Stand:updated on 01.01.2016 | Topic Governance Governance - Key functions
It is mandatory for undertakings to establish four key functions (independent risk management function, compliance function, internal audit function and actuarial function). These functions are material elements of the governance system, intended to ensure adequate and independent control within an undertaking.
In principle, undertakings are free to decide how to design their key functions. However, the chosen organisational structures must be proportionate to the nature, scale and complexity of the operations of the undertaking and the risks associated with them. The undertakings must also make sure that the key functions are not subject to influences that would prevent them from fulfilling their responsibilities objectively and independently.
Other requirements and objectives are specified in the following – non-exhaustive – list of legal bases and interpretative decisions.
Legal bases
- Section 26 (independent risk management function);
- Section 29 (compliance function);
- Section 30 (internal audit function);
- Section 31 (actuarial function).
Delegated Regulation (EU) 2015/35
- Article 268 (specific provisions);
- Article 269 (risk management function);
- Article 270 (compliance function);
- Article 271 (internal audit function);
- Article 272 (actuarial function).
Guidelines on System of Governance (EIOPA-BoS-14/253 EN)
- Guidelines 17 to 26 and 67 to 70 (risk management function);
- Guidelines 38 and 39 (compliance function);
- Guidelines 40 to 45 (internal audit function);
- Guidelines 46 to 51 (actuarial function).