Integrated Report 2020

INTEGRATED REPORT 2020 CIM FINANCIAL SERVICES LTD Risk Management Report FOCUS FOR 2020 AND BEYOND The global impact of the COVID-19 outbreak continues to rapidly evolve and the full scale of the impact is not yet known. Unpredictable and uncontrollable outcomes may still have the potential to materially impact a number of our principal risks. Hence, it remains uncertain to gauge the longer-term impact of the crisis on our business. However, the magnitude of the crisis has provided valuable insights to the company’s risk management framework and our business continuity arrangements. The Group cannot fully eliminate the downside impacts of COVID-19, however the risks will continue to be closely monitored to ensure appropriate controls and mitigants are implemented to the fullest extent possible. Our focus for the year ahead will be to ensure Cim Group’s long-term sustainability as we continue to adapt to the challenges and opportunities of the pandemic environment. Furthermore, the Risk function cannot forget the different emerging and non-traditional threats that were arising on the agenda pre-COVID-19. Whether it is fraud, impact of digital technology, data protection or cybersecurity, the awareness and alertness level to a broad set of new threats shall be maintained. A few planned initiatives include: • To extend the deployment of tailored risk and control framework across specific business units and continue fraud monitoring efforts to identify early warning signals of potential fraud; • To further strengthen our cyber-resilience due to greater digital adoption and staff mobility with better preventive and detective mechanisms through reliant and trustworthy systems, as well as continuous cyber education for employees; • To strengthen our policy governance framework to ensure long-term business sustainability as well as compliance to evolving laws and regulations; • To continue the ongoing efforts to review the internal policies, prudential limits, and set new key risk indicators in line with the changing and challenging business environment; • To mature up business continuity practices in the light of existing events, ensuring contingency plans are updated and sufficiently tested; • To prepare the business for future volatility by using advanced analytical capabilities and knowledge of risk. Key Initiatives and Achievements during the last financial year (Cont’d) Enhancing our fraud monitoring mechanisms Fraud is a widespread risk amongst financial institutions, and as such, efforts to counteract it are a critical control. Cim Group has placed a lot of significance in implementing various preventive and detective fraud mechanisms across key steps throughout the client transactional journey with us. Whilst this effort is an ongoing process, fraud monitoring is a key element on Cim Group’s agenda. Improving the “soft controls” is also essential in building the right culture across the Company to detect and prevent fraud events. Management have implemented multiple initiatives focusing on soft controls to enhance the control environment within the group. During the year, the fraud management policy, whistleblowing policy and the disciplinary policy have been reviewed by the Board. Maintaining existing businesses and relationships with customers and partners via digital tools A digital payment platform was launched to provide more flexibility to clients to pay their monthly dues online without having the hassle to do so via traditional methods, thus limiting any contagion risks, as well as ensuring the continuity of our collection and recovery efforts. Cim Finance also flexed its credit approval process to online merchants without compromising existing controls. 47