Risk Management

AB's organizational structure fosters risk management at all levels of the firm, embedding risk management as a core value and part of our culture, not just as an oversight function. AllianceBernstein (Singapore) Ltd, part of the AB’s group of company, leverages on the Firm's risk management framework.

Our Approach

Risk Controls

Our investment process employs a full range of risk controls, from the targeting and budgeting of total active risk to performance attribution. In implementing our process, we use proprietary risk models as well as an automated before trade and after trade compliance system. Risk management is also incorporated into our research, portfolio construction, counterparty selection and management of operational processes.

Risk Culture

The importance of risk management is given ongoing emphasis by the firm's leadership and senior management team, and each employee is encouraged to consider risk management as integral to his or her job function. This all works towards supporting a culture of risk management throughout the firm.

Risk Excellence

In June 2016, AB was recognized by Risk magazine for excellence in operational risk management, and named "2016 Asset Manager of the Year in Operational Risk." Risk magazine cited AB for our strong risk culture as well as for our risk management framework, team and operational risk environment.

Categorising Risk

We consider risk to have three components: investment risk, counterparty risk and operational risk.

Investment Risk

Primarily the responsibility of Portfolio Managers, but senior management and a separate and independent Investment Risk Management Group function provide oversight of all portfolios as a part of a broader set of checks and balances.

Risk management also provides perspective at the firm level, ensuring aggregate exposures and risks are addressed.

Counterparty Risk

Primarily the responsibility of the Global Risk Management Team, with support from multiple functional groups across the organisation. AB carefully selects and monitors all counterparties with whom we do business on behalf of client portfolios. Our Credit and Counterparty Risk Committee must review and approve all counterparties from a credit standpoint. Existing counterparty exposures are then monitored continuously by both our Investment Risk Management Group and our Credit Counterparty Risk Committee.

Operational Risk

Primarily the responsibility of line management, with supervisory responsibility residing with the head of each business unit.

The Centralised Oversight Group sets enterprise standards and ensures adherence to those standards.

Risk Committees

AB's Senior Management Risk Oversight Committee (SMROC) is responsible for creating our Risk Framework and overseeing its implementation across the firm. The SMROC creates policies and procedures and leads the governance committees overseeing risks in each business unit and each functional area. This Committee also ensures the organisation stays abreast of best practices and external developments in risk-related areas.

In addition to this independent Global Risk Management structure, we also have a series of Risk Oversight Committees comprised of senior executives from across the firm. Both within these risk governance committees and other less formal meetings, senior management from the various business units and members of the independent Risk Management Group regularly meet and interact to discuss relevant risk issues and mitigation plans.

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Past performance, historical and current analyses, and expectations do not guarantee future results.

Investment involves risk. The information contained here reflects the views of AllianceBernstein L.P. or its affiliates and sources it believes are reliable as of the date of this publication. AllianceBernstein L.P. makes no representations or warranties concerning the accuracy of any data. There is no guarantee that any projection, forecast or opinion in this material will be realized. Past performance does not guarantee future results. The views expressed here may change at any time after the date of this publication. This document is for informational purposes only and does not constitute investment advice. AllianceBernsteinL.P. does not provide tax, legal or accounting advice. It does not take an investor’s personal investment objectives or financial situation into account; investors should discuss their individual circumstances with appropriate professionals before making any decisions. This information should not be construed as sales or marketing material or an offer or solicitation for the purchase or sale of any financial instrument, product or service sponsored by AllianceBernstein or its affiliates.

The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams.