Strate is committed to playing its part in ensuring and enhancing the integrity of the South African financial market through the effective operation of a world-class Central Securities Depository (CSD) that has, as one of its core objectives, the effective management of risk.
According to the Bank for International Settlements, Financial Market Infrastructures (FMIs) are generally sophisticated multilateral systems that handle significant transaction volumes and sizable monetary values. Through the centralisation of certain activities, FMIs allow participants to manage their risks more effectively and efficiently, and, in some instances, reduce or eliminate certain risks.
In order to achieve this, Strate has adopted a structured and disciplined approach to the management of risk. It promotes and maintains an enterprise-wide culture that values the importance of effective risk management, encouraging open and frank dialogue regarding the effectiveness of risk management practices and potential risk management deficiencies. There are also clearly defined responsibilities and levels of authority for risk taking across the organisation. The company employs efficient and effective tools, methods, models and technology to support its risk management endeavours.
The Strate Risk Management Policy underpins each corporate and operational activity and its objectives are embedded throughout the company. The risk management activities of the company (including the review and revision of the Risk Management Policy and Framework) are subjected to ongoing scrutiny by the Audit, Risk & Compliance Committee (ARCC) of the Board.
Adherence to internationally recognised risk management standards is an important aspect for Strate, given the role that it performs in the South African market. This is supported by active participation in reviews undertaken by the likes of Thomas Murray and the Association of Global Custodians to obtain an independent assurance thereof.