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OPERATIONAL RISK MANAGEMENT Proactive measures that were taken to address the reported
OREs are among others as follows:
Operational risk is the potential loss resulting from
inadequate or failed internal process, people, systems • The team facilitated discussions with other parties to
or from external events. It includes but not limited to mitigate the risk and avoid recurrence of incident;
fraud, physical damage, business disruption, transaction
failures, legal and regulatory breaches as well as • The team and the first line of defence performed root
employee health and safety hazards. It also includes cause analysis and validation on the key process on
reputational risk associated with KWAP’s business the risk events to enhance risk controls and to ensure
operations or conduct. clearly defined roles and responsibilities of parties
involved;
In order to accommodate to the complex operations in
today’s business, KWAP utilises Operational Risk Event • The team presented the OREs reported at EXCO, RCC
(ORE) reporting to effectively respond and manage and BRCC meetings to ensure all issues were properly
operational losses arising from the actual events. If addressed; and
implemented effectively, the positive outcomes of ORE will • The team tracked and monitored outstanding OREs
not only produce better responses to risk events but also with respective parties to ensure mitigation actions are
better management of risks. in place to minimise recurrence of the incident.
In 2022, there were no risk events with damaging impact FRAUD RISK MANAGEMENT PROGRAMME
on KWAP’s operation as most of OREs were successfully
rectified in a timely manner. The reported OREs were Fraud Risk Management Programme was developed to
mainly under the following categories of risk events: demonstrate the expectations of the Board and Senior
Management; and their commitment to high integrity and
ethical values regarding managing fraud and corruption
i External Fraud; risk effectively.

The Fraud Risk Management Programme for KWAP
comprises of policy and guidelines, training and
ii Business disruption and system failures; and
awareness and departmental fraud risk assessment.
Pursuant to the establishment of Integrity and Governance
Office (IGO) in 2019, Corruption Risk Management (CRM)
iii Execution, delivery and process management. is embedded into the risk management framework. As
a result, RMCD and IGO have collaboratively pursued
the thematic risk assessment for all departments and
subsidiaries in KWAP.