1. Introduction

The aim of the Risk Management Policy is to provide guidelines on the management of risks to enable the achievement of strategic and operational objectives of Gromio Limited.

The Policy seeks to cover all material risks that the Company

2. Definitions

Board: Means the Board of Directors of Gromio Limited.

Company: Means Gromio Limited

Directors: Means the members of the Board.

Investment Manager: Means Gromio Limited Investment Services

Risk Management Plan: Means the risk management plan approved by the Investment Manager.

3. Purpose

• The purpose of this Policy is to state the overall intentions and direction of Gromio Limited in relation to risk
• Risk management comprises a series of planned and coordinated activities to direct and control an organization with regard to
• Risk is the effect of uncertainty on

4. Policy

• All investments and businesses involve risk. Gromio Limited is subject to an ever-changing spectrum of risk which may impact its ability to achieve its financial, operational, and investment
• Risk management is an important discipline which, to be effective, must be planned, implemented and
• The purpose of risk management is to plan for risk and to put into place controls which may reduce the likelihood of risks eventuating and to develop contingency plans to minimize their consequences if they

5. Risk management process

• The purpose of the risk management process is to protect and further the interests of the Company’s
• The risk management process is the systematic application of management policies, procedures, and practices to the activities of communicating, consulting, establishing the context, and identifying, analyzing, evaluating, treating, monitoring, and reviewing
• Risk management is not about avoiding risk. Risk necessarily attaches to all business decisions and risks must be taken to further the objectives of the

6. Risk Management Plan

• Gromio Limited anticipates that the establishment of a risk management framework will assist both the Board and the Investment Manager to make informed and transparent decisions which will assist the Company to achieve its
• The risk management framework will comprise a set of components that will provide the foundations and organizational arrangements for designing, implementing, monitoring, reviewing, and continually improving risk management throughout the
• Risk appetite is the combined level of tolerance for all the risks that the Company is willing to accept in pursuing its objectives. Through its risk management plan, Gromio Limited will define its individual risk tolerances and therefore its collective risk appetite.
• To articulate its risk appetite, Gromio Limited will maintain a risk register which will record information about all identified, material, risks including their risk tolerances.

7. Standards

• The risk management plan, process, and framework have been designed to meet industry standards.
• The following standards have and will continue to be adopted by Gromio Limited in its risk management framework, plan, and process:
  • International Standards ISO 31000 Risk management – Principles and guidelines
  • Guidance issued by the Government Securities & Investments Commission
• The Board is assisted in its risk management activities by the Audit and Risk Committee. Co‐ordination of risk management activities is done by the Company Secretary, who reports to the Audit and Risk Committee on such

8. Key Risk Areas

Two key areas of risk have been identified: Investment Risk and Operational

8.2 Investment Risk

Investment risk includes:

• Market risk;
• Credit, counterparty and settlement risk;
• Liquidity risk; and
• Reputational risk (insofar as it relates to the investments that the Company enters into).

The Investment Manager is primarily responsible for dealing with issues arising from investment risk and has day‐to‐day management of the portfolios by an experienced investment team.

By its nature as a listed investment company, the Company will always carry investment risk because it must invest its capital in securities which are not risk-free. However, the Company seeks to reduce this investment risk by a policy of diversification of investments across industries and companies operating in various sectors of the market.

In addition to the investment portfolio, the Company also operates a trading portfolio for short term opportunities. From time to time the Investment Manager may seek to enhance returns by selling call and put options. The Investment Manager maintains close control of options transactions.

8.3 Operational Risk

The Investment Manager is primarily responsible for recognizing and managing operational risk issues such as legal and regulatory risk, systems and process risk, human resource risk, reputation risk (insofar as it relates to the operations of the Company), and disaster recovery risk.

• The Company receives reports from the Investment Manager outlining the control objectives for Gromio Limited and the specific policies and procedures established to meet these procedures. These policies include management oversight, segregation of duties, multiple sign‐offs, and specific authorization
• The Investment Manager reports each year that these have been in place throughout the period, and have been effective in meeting the control
• These statements and verifications are confirmed with the Company’s auditors under the requirements of Auditing Standard

9. Publication of the Policy

Key features of the policy are outlined in the annual reports to shareholders each

The policy is available at www.gromiolimitedPolicy