Mitigating key risks

Overview of key risks

In the ordinary course of business, the IDC faces a number of risks that could affect our business operations. These risks are summarised briefly in the table below with further detail provided in the Governance section of this report.

Our risk assessment process for 2013 resulted in a Risk Universe and Risk Register of material risks that the Corporation may be exposed to. These are linked to the strategic objectives and material issues of the Corporation. The table below also demonstrates how these risks are mitigated:

Key risks Alignment to strategic objectives Link to material issues Mitigating controls Further detail
The risk of investment (debt, equity or guarantee) losses/loss of income or inability to collect what is due to the IDC Sustainability: Financial Capital Continue to be a financially sustainable organisation
  • The IDC has formalised investment assessment guidelines with independent approving bodies
  • Formalised internal and external training for IDC staff and clients
  • Impairment policy is in place
See here
The risk of concentration within the IDC portfolio from a counterparty, sector, regional/country or product perspective Sustainability: Financial Capital Continue to be a financially sustainable organisation
  • Sector, regional investment, country, counterparty and transaction limits
  • IMC loans and equity analysis
  • Pipeline business management and capacity forecasting process
  • Capital allocation process
See here
The risk of the IDC failing to meet expected levels of customer satisfaction Sustainability: Human, Social, Natural and Manufactured Capital Improve customer service levels including turnaround times and ease of doing business with IDC
  • Annual customer satisfaction survey
  • Register of client complaints
  • “15-day” turnaround initiative
See here
The risk of inadequate/inappropriate legal documentation Sustainability: Human, Social, Natural and Manufactured Capital Maintain good governance, including risk assessment and fraud prevention processes
  • Legal due diligence
  • External legal advice is sought where appropriate
  • System restrictions for data capture, formatting and updates
see here
Ineffective/incomplete due diligence process Sustainability: Financial Capital Continue to be a financially sustainable organisation
  • Training programmes for staff
  • Lessons Learnt Portal
  • Peer reviews
See here
The risk of the volatility of the IDC listed share portfolio impacting the IDC Sustainability: Financial Capital Continue to be a financially sustainable organisation
  • Monitoring and reporting of listed share portfolio by the Corporate Strategy and Portfolio Management Department
  • “Stop loss” mechanisms
See here
Increased inequality and incidence of poverty may result in a greater occurrence of protests, not only by organised labour but also communities, impacting on IDC-financed enterprises and the corporate reputation (social unrest) Sustainability: Human, Social, Natural and Manufactured Capital Ensure that benefits of IDC-funded projects flow to communities
  • Management analysis of economic, industrial, legal and other economic events and reporting each potential implication to the Board and Exco
See here
All forms of internally/externally conducted theft or fraudulent activities Sustainability: Financial Capital Maintain good governance including risk assessment and fraud prevention processes
  • Fraud monitoring procedures and systems
  • Financial system controls
  • Whistle Blowing Policy “Tip-Offs Anonymous” process
See here

CASE STUDY

Platmin

This regionally optimised mega mine will lead to the creation of an operation of significant size, allowing for mining of the ore body in a continuous and sustainable manner.

Coega Dairy Holdings

The IDC has identified increased competition in the dairy value chain and import substitution in the cheese industry as key sector development goals. We also singled out the need for increased farmer (and specifically B-BBEE) participation in dairy value-adding initiatives.

Windtown Lagoon Resort 

The newly built Windtown Lagoon Resort and Spa reflects the IDC’s focus to funding community-based projects that have potential to create employment opportunities in far-flung regions.


APPROVALS
R13.1 billion
DISBURSEMENTS
R16.0 billion
JOBS FACILITATED
18 922
JOBS SAVED
3 950
© The IDC 2013. All rights not expressly allowed are reserved. P.O. Box 784055, Sandton, 2146, South Africa