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Glossary

Risk Management Function

Risk Management Function is the internal control body prescribed by FinIA that systematically identifies, assesses, and monitors the risks of a wealth manager. At small institutions it may be combined with other roles, but must be documented and effectively separated from the operational management.

At a glance

  • FinIA (Art. 9) requires appropriate internal organisation, which includes effective risk management.
  • For small wealth managers, FINMA accepts simplified arrangements, provided the independence of the function is preserved.
  • The risk management system must be documented in writing and reviewed regularly; results must be made available to the Supervisory Organisation.

Frequently asked questions

FinIA provides for proportionate requirements. As a sole practitioner, you may fulfil the Risk Management Function yourself, but must demonstrate a clearly documented system for identifying and monitoring risks. The Supervisory Organisation assesses the adequacy of the arrangement as part of the Affiliation Audit.

Sources: FINMA · Systematische Rechtssammlung (fedlex)