Risk management framework
Risk is an integral part of any investment process, and it is represented by uncertainty, and it is measured according to its probability of occurrence and the potential effects if it occurs.
The Libyan Investment Authority is charged with protecting and developing the wealth of the Libyan people for the benefit of future generations. To achieve this, we must proactively manage risks.
We are aware of the importance of comprehensive risk management to identify and analyze all types of risks in different asset classes, as well as ensure that any potential problems are mitigated and managed efficiently.
Our Approach to Risk
We are enhancing our risk management approach through a continuous focus on risk awareness throughout our Authority.
We also focus on maximizing our ability to achieve the strategic objectives of LIA, promoting sound decision-making, and protecting LIA and its employees.
Risk measurement tools
- VAR- Value at Risk
- Concentration Risk
- Volatility & Correlation Risk
- Standard Deviation
RISK CULTURE
RISK APPETITE
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RISK GOVERNANCE
The Board of Directors has complete control and supervision over the risk framework and risk-return objectives, whereas the Authority’s Audit, Risk and Compliance Committee is responsible for monitoring and evaluating the effectiveness of the risk management framework, policies and practices. -
RISK CULTURE
All LIA employees play an important role in maintaining an appropriate risk environment. We are committed to providing training and development to our employees regarding risk management, and we expect them to embody the highest standards of ethics, integrity and professionalism. -
RISK APPETITE
Our investment decisions give priority to long-term decisions, while adhering to our established laws and adopting international best practices. The amounts and types of risks that LIA can take in order to achieve its strategic objectives are specified in the LIA’s Risk Appetite Statement.
