A full description of the Risk Management Framework of the British Business Bank is included within their Annual Report. The main aspects of the framework are:
- A collection of tools, processes and methodologies to identify, assess, monitor and control risks.
- A Risk Appetite Policy which British Business Investments is subject to, however the British Business Investment’s Board approves the company’s own Risk Appetite Statement.
- Risk governance based on the ‘three lines of defence’ model.
- A wide range of policies, frameworks and procedures which take account of regulatory or legal requirement and industry best practice.
The key operational risks the company is exposed to are:
- Maintaining a suitably qualified investment team and Board to deliver the company’s investment strategy.
- Ensuring systems and processes support investment decision making, reporting and portfolio management.
- Procuring appropriate support across a range of services from the British Business Bank including: finance, legal, risk, IT and marketing.
The key financial risks the company is exposed to are detailed in note 13(iii) of the accompanying financial statements.
British Business Bank plc is the ultimate parent of British Business Investments Limited and the policies and procedures that apply to the British Business Bank also apply to British Business Investments (the trading name of British Business Bank Investments Limited).
The British Business Investment’s constitution consists of its Articles of Association and a shareholder relationship framework document between British Business Investments Limited and the British Business Bank plc (the ‘Framework Document’). It sets out, among other things, British Business Investment’s role within the group including the responsibilities of Board of Directors and the relationship between British Business Investments and the British Business Bank.
Our Shareholder Framework Document requires that no more than one-third of the Board may consist of members of the British Business Bank Board.
It also provides that the consents of both the British Business Bank and Department for Business, Energy, and Industrial Strategy (BEIS) are required prior to the appointment of any new directors to the Board where the appointee is external.
The CEO of the British Business Bank, as Accounting Officer, has direct accountability to British Business Investments ultimate shareholder, BEIS, and sits on the Board of British Business Investments Ltd. Responsibilities of an Accounting Officer include responsibility for the propriety and regularity of the public finances for which the Accounting Officer is answerable, keeping proper records and safeguarding British Business Bank Investments assets.
As a major subsidiary of British Business Bank plc, British Business Investments Ltd comes within the remit of the British Business Bank’s Audit and Risk Committees. To ensure effective governance each committee has its own terms of reference.
As a major subsidiary of British Business Bank plc, British Business Investments Ltd comes within the remit of the British Business Bank’s Governance & Nomination and People & Remuneration Committees. To ensure effective governance each committee has its own terms of reference.