(Article 16(5) of Directive 2014/65/EU)
1. Investment firms shall take the following actions relating to risk management:
(a) establish, implement and maintain adequate risk management policies and procedures which identify the risks relating to the firm’s activities, processes and systems, and, where appropriate, set the level of risk tolerated by the firm. In doing so, investment firms shall take into account sustainability risks;
(b) adopt effective arrangements, processes and mechanisms to manage the risks relating to the firm's activities, processes and systems, in light of that level of risk tolerance;
(c) monitor the following:
(i) the adequacy and effectiveness of the investment firm's risk management policies and procedures;
(ii) the level of compliance by the investment firm and its relevant persons with the arrangements, processes and mechanisms adopted in accordance with point (b);
(iii) the adequacy and effectiveness of measures taken to address any deficiencies in those
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