Advisory Services for Boards, Management & Investors
Risk Advisory
Providing clients with a comprehensive picture of their risks (market, credit, counterparty, liquidity, investor, black swan, etc.).
Integrated risk, performance and attribution reporting across traditional and alternative assets.
Advice on risk management organizational structure, the role of the CRO, and committee charters.
Compensation linked to risk: best practices.
Independent reviews of valuations, risk models, and strategies that use complex instruments.
Risk Appetite Statements that permit boards to communicate to management a uniform view on acceptable risk.
Risk Budgeting to create optimal returns given an overall risk appetite.
Risk Governance assessments based on extensive benchmarking and surveys as well as on our experience as Trustees and Directors.
Reviews of risk management policies and procedures relative to best practices.
Risk Benchmarking
Investment and Private Equity Due Diligence
Business plan due diligence for private equity investors in financial services.
Assessments of risks at the fund, hedge fund and operating level.
Training in Risk Due Diligence
The Role of the Board in Risk Oversight
Risk Culture
Risk Reporting
Risk Education
Risk Appetite and Risk Attitude Statements
Risk Appetite Statements help boards communicate to management a uniform view of an acceptable risk profile. CMRA is a pioneer in expanding "Risk Appetite" statements to include "Risk Attitude" and is using interactive technology to assist both the Board and management in identifying areas of agreement and disagreement and creating a Risk Appetite Statement and creating a Risk Conscious Culture.
We have assisted Institutional Investors, banks/broker dealers, insurance companies, and asset managers in the creation of Risk Appetite and Attitude Statements
Risk Budgeting
CMRA has advised Institutional Investors on all aspects of Risk Budgeting.
Leslie Rahl is the editor of Risk Budgeting, a New Approach to Investing published in 2000.
Best Practices Assessment
CMRA helped create "Risk Practices for Mutual Fund Trustees (2010)" , "Risk Principles for Asset Managers (2009)", and "Risk Standards for Institutional Investors and Investment Managers (1996)."
Benchmarking policies and procedures against best practices and providing a gap analysis.
Annual Risk Governance Survey
Risk Due Diligence
CMRA conducts risk due diligence both at the request of funds seeking to benchmark and improve their practices, as well for Institutional Investors considering investing in or already invested in a fund.
Leslie Rahl is the author of Hedge Funds: Unraveling the Complex and Controversial Debate, Risk Books, (March 2003).
Risk Governance Assessments and Advisory
CMRA is uniquely suited to assist our clients on risk governance as a result of our own experience as directors and trustees, as well as our extensive risk governance benchmarking and advisory work.
CMRA has surveyed financial institutions on risk governance practice annually since 2009.
Linking Compensation to Risk
Defining the denominator-more than just VAR
Risk Adjusted Returns
Charges for limits as well as usage
Board and Trustee Education
Our perspective as Board members, risk experts, traders/structurers and business managers uniquely positions us to advice Boards on issues from Risk Governance to Risk adjusted compensation
Providing "translations" of risk reports that make them meaningful to Boards and CEOs.
Risk Measurement and Reporting
Designing Risk Reports that have "context"
Focus on trends and exceptions
Integration of stress testing and "nightmare" scenarios
Independent Model Reviews
Emphasis on input control and assumptions not just math
Is model appropriate for task or is a square peg being forced into a round hole
What are the model's Achilles Heels? Under what extreme moves does it break down?
New Product Reviews and Policies
What constitutes a "new" product vs a variation on an old product?
Valuations of Derivatives, Structured Products, RMBS, CDOs, CLOs
Review of valuation policies
Review of Valuation Committee role and charter
Independent review of valuations
Transaction Services
Independent evaluation of OTC derivative and Structured Finance pricing, structuring and documentation, collateral valuation, comprehensive transaction risk pricing.
Assistance in effective execution.