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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Risk Management

Bharat Logistics Ltd is a listed entity. Its Risk Management Committee reviews cyber security risks and sustainability risks. The CS is asked which duty the LODR specifically places on the committee in this regard. Which is correct?

The Risk Management Committee must formulate a detailed risk management policy covering financial, operational, sectoral, ESG and sustainability, information and cyber security risks, with mitigation measures and a business continuity plan, and then monitor its implementation. It does not audit accounts, declare dividends or appoint the CEO.

  1. AThe committee formulates a detailed risk management policy covering internal and external risks, including financial, operational, sectoral, sustainability (ESG), information and cyber security risks, and business continuity planCorrect
  2. BThe committee only approves the dividend policy
  3. CThe committee audits the financial statements instead of the statutory auditor
  4. DThe committee's role is limited to appointing the CEO

Explanation

LODR requires the committee to formulate a detailed risk management policy covering financial, operational, sectoral, sustainability (particularly ESG), information, cyber security and other risks, with measures for risk mitigation and a business continuity plan. It also monitors and oversees implementation. The other options describe unrelated functions.

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