One of the most important tasks of the HKMA is to manage risks to the monetary and banking systems. Risk management is undertaken both at a working level in the day-to-day operations of the HKMA and at a higher level through strategic planning.

The Chief Executive chairs a high-level Risk Committee established to

• identify potential risks and threats to the organisation and the monetary and financial systems more broadly, and devise strategies to reduce the impact of these risks and threats

• review the existing systems for managing risks across different departments to identify possible gaps and significant risks, and ensure the adequacy of measures to address them

• harmonise the criteria and methods of risk measurement and prioritise the resource management of risks identified

• encourage a stronger risk management culture which promotes the proper levels of authorisation and controls.

The Committee meets regularly to review the risk assessments made by the business units and the adequacy of controls, as well as to identify potential or emerging risks and devise mitigating strategies. One of the areas on which the Committee focused in 2006 was business continuity planning for a possible outbreak of avian flu, not only for the HKMA but also the financial sectors for which it is responsible. The Committee also considered ways to strengthen the corporate business continuity plan of the HKMA and refinements to the Risk Assessment Methodology to facilitate a more efficient self-assessment of risks.