UNM » Topics » Risk Management

These excerpts taken from the UNM 10-K filed Feb 24, 2009.

Risk Management

We have an Enterprise Risk Management (ERM) program. Our ERM program strives to:

 

   

Identify, measure, mitigate as appropriate, and report on our risk positions and exposures, including notable risk events;

   

Provide an assessment of our material risks, including how they affect us, how individual risks interrelate, and how management addresses the risks;

   

Coordinate development of and compliance with risk appetite statements, including systematic limit monitoring;

   

Identify emerging risks and analyze how material future risks might impact us;

   

Practice strong risk management, including ensuring diversification across and within business units; and

   

Fulfill regulatory, rating agency, and governance objectives.

We employ a “pyramid” risk committee structure, beginning with Unum Group’s board of director committees and cascading down to business unit risk committees, to govern our ERM process and manage our risks in an integrated manner. Collectively, these committees are responsible for managing our strategic, market, credit, insurance, operational, capital and liquidity, and reputational risks.

Business unit risk committees for each of our three primary business units as well as our corporate function are responsible for identifying, measuring, reporting, and managing insurance and operational risks within their respective areas, consistent with established corporate risk tolerance levels. We manage insurance and operational risk at the business unit level, based on consistent principles and policies established at the corporate level. Internal quality controls are routinely monitored by the risk committees. Market and credit risk are jointly managed by our investment committee, which is also responsible for monitoring our investment risk appetite and ratifying investment transactions. Capital and liquidity risk is under the purview of the capital management committee, which is responsible for planning and monitoring capital allocation, financing, liquidity, and solvency considerations. An executive risk management committee is responsible for overseeing our enterprise-wide risk management program that is managed by our chief risk officer. The executive management team is responsible for managing our strategic risk. We provide an ERM report to the audit committee of Unum Group’s board of directors on a regular basis.

We believe that by effectively executing against these objectives we will be better positioned to fulfill our corporate mission, improve and protect shareholder value, and reduce reputational risk.

 

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Table of Contents
Index to Financial Statements

Risk Management

STYLE="margin-top:12px;margin-bottom:0px">We have an Enterprise Risk Management (ERM) program. Our ERM program strives to:

 







  

Identify, measure, mitigate as appropriate, and report on our risk positions and exposures, including notable risk events;







  

Provide an assessment of our material risks, including how they affect us, how individual risks interrelate, and how management addresses the risks;







  

Coordinate development of and compliance with risk appetite statements, including systematic limit monitoring;







  

Identify emerging risks and analyze how material future risks might impact us;







  

Practice strong risk management, including ensuring diversification across and within business units; and







  

Fulfill regulatory, rating agency, and governance objectives.

FACE="Times New Roman" SIZE="2">We employ a “pyramid” risk committee structure, beginning with Unum Group’s board of director committees and cascading down to business unit risk committees, to govern our ERM process and manage our
risks in an integrated manner. Collectively, these committees are responsible for managing our strategic, market, credit, insurance, operational, capital and liquidity, and reputational risks.

STYLE="margin-top:12px;margin-bottom:0px">Business unit risk committees for each of our three primary business units as well as our corporate function are responsible for identifying, measuring, reporting, and
managing insurance and operational risks within their respective areas, consistent with established corporate risk tolerance levels. We manage insurance and operational risk at the business unit level, based on consistent principles and policies
established at the corporate level. Internal quality controls are routinely monitored by the risk committees. Market and credit risk are jointly managed by our investment committee, which is also responsible for monitoring our investment risk
appetite and ratifying investment transactions. Capital and liquidity risk is under the purview of the capital management committee, which is responsible for planning and monitoring capital allocation, financing, liquidity, and solvency
considerations. An executive risk management committee is responsible for overseeing our enterprise-wide risk management program that is managed by our chief risk officer. The executive management team is responsible for managing our strategic risk.
We provide an ERM report to the audit committee of Unum Group’s board of directors on a regular basis.

We believe that by effectively executing
against these objectives we will be better positioned to fulfill our corporate mission, improve and protect shareholder value, and reduce reputational risk.

 


109







Table of Contents


Index to Financial Statements


These excerpts taken from the UNM 10-K filed Feb 25, 2008.

Risk Management

We have an Enterprise Risk Management (ERM) program, with primary objectives of:

 

   

Improving our Company’s risk-based decision making;

 

   

Effectively utilizing our capital to improve our Company’s risk adjusted returns;

 

   

Improving and protecting shareholder value; and

 

   

Supporting efforts to minimize our reputational risk.

Our chief risk officer manages the ERM program. We utilize a “pyramid” risk committee structure, beginning with our board of director committees and cascading down to business segment risk committees, to govern our ERM process and manage our risks in an integrated manner. Collectively, these committees are responsible for managing our strategic, market, credit, insurance, operational, capital and liquidity, and reputational risks.

An executive risk management committee is responsible for overseeing our corporate-wide risk management program. Representative activities of this committee include, but are not limited to, reviewing risk reports, establishing corporate risk tolerance levels, providing direction on emerging risk issues, and reporting on a periodic basis to our board of directors. The following executives comprise the committee: our president and chief executive officer, our chief financial officer and chief actuary, our general counsel, the presidents of our three primary business units, our chief operating officer for Unum U.S., our chief risk officer, and the senior vice president of internal audit.

Business unit risk committees for each of our three primary business units as well as our corporate function are responsible for identifying, measuring, reporting, and managing insurance and operational risks within their respective areas, consistent with corporate risk tolerance levels. Market and credit risk are jointly managed and executed by our asset/liability and investment committees.

 

95


Table of Contents

Risk Management

We
have an Enterprise Risk Management (ERM) program, with primary objectives of:

 







  

Improving our Company’s risk-based decision making;

 







  

Effectively utilizing our capital to improve our Company’s risk adjusted returns;

STYLE="font-size:6px;margin-top:0px;margin-bottom:0px"> 







  

Improving and protecting shareholder value; and

 







  

Supporting efforts to minimize our reputational risk.

SIZE="2">Our chief risk officer manages the ERM program. We utilize a “pyramid” risk committee structure, beginning with our board of director committees and cascading down to business segment risk committees, to govern our ERM process and
manage our risks in an integrated manner. Collectively, these committees are responsible for managing our strategic, market, credit, insurance, operational, capital and liquidity, and reputational risks.

STYLE="margin-top:12px;margin-bottom:0px">An executive risk management committee is responsible for overseeing our corporate-wide risk management program. Representative activities of this committee include, but
are not limited to, reviewing risk reports, establishing corporate risk tolerance levels, providing direction on emerging risk issues, and reporting on a periodic basis to our board of directors. The following executives comprise the committee: our
president and chief executive officer, our chief financial officer and chief actuary, our general counsel, the presidents of our three primary business units, our chief operating officer for Unum U.S., our chief risk officer, and the senior vice
president of internal audit.

Business unit risk committees for each of our three primary business units as well as our corporate function are responsible
for identifying, measuring, reporting, and managing insurance and operational risks within their respective areas, consistent with corporate risk tolerance levels. Market and credit risk are jointly managed and executed by our asset/liability and
investment committees.

 


95







Table of Contents


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