The own-risk assessment has been carried out
As required by European legislation, APF Pension Fund carried out its first own-risk assessment (ORA) in 2020. As also required by European legislation, it will now repeat this assessment once every three years.
So, what’s the ORA all about?
The object of the ORA is to gain an insight into the connection between our strategy, material risks and the possible consequences of both for the various interested parties and the pension fund itself. We also establish whether it is possible to improve the effectiveness and efficiency of risk management.
Which points for attention emerge from the assessment?
When carrying out the ORA in 2020, APF Pension Fund paid extra attention to the risks that arise in scenarios that involve the addition of a new scheme to the new pension system, combined with the (continued) affiliation of both employers. The risks possible in various economic scenarios were analysed too, including a pandemic and climate scenario.
How did we carry out the ARO?
The ARO consists of a number of parts that are geared towards identifying the material risks that could jeopardise the strategy pursued - which includes the risk attitude and strategic policy (for example, contribution policy, investment policy and sustainability). We carried out various analyses, developed stress scenarios and analysed the impact of these stress scenarios in respect of the above. The outcomes obtained have given the Board a good insight into the risks applicable and also identified several new and emerging risks. The Board believes that it is ‘in control’ and the outcomes do not give any reason to adjust the strategy and risk attitude of APF Pension Fund.
What happens now?
The extensive analyses also revealed several areas in which the approach to risk management as a whole could be improved. These improvements will be implemented in 2021, after which the Board will be in a position to focus on strategic risks even better.