2022年1月6日
资讯洞见
Interestingly, one of the consequences of the Securities and Futures Commission’s (SFC’s) new Business Risk Management Questionnaire (BRMQ) is to impose specific obligations on firms even though the BRMQ is not a rule or a regulation. For example, firms are basically being required to maintain whistleblowing procedures (see #2 in the table below), even though this is not expressly required in any of the SFC’s codes or guidelines. The BRMQ also serves to remind firms of some existing regulatory requirements which are often overlooked.
Many specific obligations (including requirements to have certain policies and procedures) are embedded into the BRMQ by virtue of the fact that in the case of many of the questions, there is a clear ‘right’ answer and a clear ‘wrong’ answer, in the sense that if the wrong answer is given, the firm should expect to hear from the SFC. See for example question #2 again: “Yes” is the right answer.
We think it makes sense therefore for firms to take advantage of this COVID-19 relatively quieter time to review their compliance manuals against the policy and procedure “requirements” set out in the BRMQ and to revise if need be. To this end we have listed below the key policies and procedures which are required under the BRMQ so that firms can add these to their compliance manuals if they wish.
If any of these items are not already in the compliance manual, there may be a gap between what staff are doing operationally and what the SFC expects because staff members are not typically required to conduct themselves in accordance with the answers to the BRMQ questions.
Revising the compliance manual to include these policies and procedures will strengthen a firm’s compliance. Furthermore, if the manual can also make it clear why this new language has been added, this should help firms complete their BRMQs more easily moving forward.
We have listed below the key new policy and procedural “requirements” imposed on asset managers by the new BRMQ based on Section A (which is mandatory) and Section B (which relates to fund raising and best execution (i.e. Sections B9 and B15 respectively)).
|
√ |
# |
Requirements |
BRMQ source |
General regulatory source |
|
□ |
1. |
Escalation policies relating to breaches including risk posed to firm’s operations and financial position |
Q1(a) Section A5 |
Paragraph 2 of Part I of Management, Supervision and Internal Control Guidelines For Persons Licensed by or Registered with the SFC (ICG) |
| □ |
2. |
Whistleblowing procedures relating to reporting by staff about malpractices and unethical behaviours |
Q2 Section A5 |
General Principles 7 and 9 of the Code of Conduct for Persons Licensed by or Registered with the SFC (Code of Conduct) |
| □ |
3. |
Market risk management policies and procedures |
Q2 Part I Section A9 |
Part VIII of ICG and paragraph 30 of Part B of Appendix to ICG |
| □ |
4. |
Credit risk management policies and procedures |
Q8 Part III Section A9 |
Part VIII of ICG and paragraph 23 of Part B of Appendix to ICG |
| □ |
5. |
Liquidity risk management policies and procedures including procedures relating to adequacy of funding |
Q12 & Q15, both Part IV Section A9 |
Part VIII of ICG and paragraphs 32 to 34 of Part B of Appendix to ICG |
| □ |
6. |
Operational risk policies and procedures |
Q18 Part V Section A9 |
Part VII of ICG |
| □ |
7. |
Politically exposed persons related AML policies and procedures (also read our other article in our newsletter) |
Q1(a) Part I Section A12 |
2.1 of Guideline on Anti-Money Laundering and Counter-Financing of Terrorism (For Licensed Corporations) |
| □ |
8. |
Best execution policy |
Q1(a) Section B15 |
Paragraphs 3.2 of the Code of Conduct, 3.2 of the Fund Manager Code of Conduct and 6 of Part VII of ICG |