The board is ultimately responsible for ensuring that the group’s system of internal control is effective to guard against any loss of the group’s assets. The risk assessment and management function therefore covers any routine transactional risks which a mining group of the size and nature of Northam is exposed to in the normal course of business.
At Northam, risk assessment is an executive management function. The process is overseen by the audit and risk committee on behalf of the board.
Northam implements annual reviews of the nature and extent of the risks facing the company. Based on its risk appetite and tolerances framework, the board is able to determine whether:
- The strategic plans of Northam demonstrate sufficient risk-taking being pursued to achieve shareholder expectations, i.e. Northam is exploiting its appetite to take risks adequately and optimally
- The total risk profile remains within the boundaries of its risk appetite, i.e. the entity is not exceeding its risk appetite
- Northam’s risk profile is managed within acceptable levels of tolerance