of the Seine, fire or epidemic. The analysis of the financial and non-financial consequences and impact of the various scenarios that could poten- tially compromise the FRR s business continuity was updated in 2016. The FRR s different credit management and business continuity measures were tested during the EU Sequana exercise in 2016, and when the Seine flooded in June 2016.

The FRR s operational risk management system is also based on regular self-appraisals of risks to update risk mapping and identify residual risks. The overhaul of key processes as and when necessary (precise description of roles and responsibilities, and structuring of checks on the various lines of defence) also helps to reduce operational risks upstream.


The FRR ensures that its employees comply with a very strict ethical framework at all levels.

The ethical framework applicable to the three members of the Management Board is governed by the French Social Security Code. Moreover, all staff are bound by a code of conduct that lays down the rules for professional and personal behaviour. Ethical, money laundering and terror- ist financing risks are subject to specific due diligence checks as part of the investment man- ager selection process.

Investment and portfolio compliance

Compliance risk is the risk associated with non-compliance with legislative, regulatory or internal provisions.

Ensuring compliance is an essential part of the internal control system. As such, the FRR: monitors managers fulfilment of their con- tractual obligations each day;

checks that the investments made through UCIs and debt funds comply with internal rules;

ensures that its regulatory ratios are com- plied with (diversification between issuers, holding limit on the capital of companies in the portfolio, holding limit on UCIs, exposure to currency risk, exposure to collective funds, various commitment ratios).

An analysis of any cases of non-compliance, impact assessments, corrective measures and possible compensation claims are presented and monitored at Risk Committee meetings.