Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 213

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 213
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 and Compliance function carried out a review in 2024, which led to enhancements to our Global Risk Appetite Framework to help ensure it remains aligned to industry best practices, regulatory expectations and our strategic goals. Our Global Risk Appetite Framework continues to evolve and expand its scope as part of our periodic review process. The Board reviews and approves the Group’s risk appetite regularly to make sure it remains fit for purpose. The Group’s risk appetite is considered, developed, and enhanced through the following principles: – alignment with our strategy, purpose, values, external risk environment, reputational and customer needs; – compliance with applicable laws, regulations and regulatory priorities; – forward-looking insights into future risk exposure; – sufficiency of available capital, liquidity and balance sheet leverage to absorb the risks; – capacity and capabilities of people to manage the risk landscape; – functionality, capacity and resilience of available systems to manage the risk landscape; – effectiveness of the applicable control environment to mitigate risk; and – internally and externally disclosed commitments. We formally articulate our risk appetite through our Risk Appetite Statement (‘RAS’). Setting out our risk appetite helps ensure that we agree a suitable level of risk for our strategy. In this way, risk appetite informs our financial planning process and helps senior management to allocate capital to business activities, services and products. At a Group level, performance against the RAS is reported to the Group Risk Management Meeting alongside key risk indicators to support targeted insight and discussion of breaches of risk appetite and any associated mitigating actions. This reporting allows risks to be promptly identified and mitigated, and informs risk-adjusted remuneration to drive a strong risk culture. Coverage of each principal subsidiary and material operating entity is monitored through a RAS, which helps ensure they remain aligned with the Group’s RAS. Each RAS and business activity is guided and underpinned by qualitative principles and/or quantitative metrics.

Risk management We recognise that the primary role of risk management is to help protect our customers, business, colleagues, shareholders and the communities that we serve, while ensuring we are able to support our strategy and provide sustainable growth. This is supported through our three lines of defence model described on page 145 . In addition, we recognise the importance of a strong culture, which refers to our shared attitudes, beliefs, values and standards that shape behaviours including those related to risk awareness, risk taking and risk management. All our people are responsible for the management of risk, with ultimate supervisory oversight residing with the Board. The implementation of our business strategy remains a key focus