Annual Report 2025 99 1 2 3 Risk Governance CLAR’s risk governance is anchored in independent oversight by the Board, supported by clear accountability and transparency in risk-taking by Management. Board and Audit & Risk Committee (ARC) • Oversee risk governance and ensure Management maintains adequate and effective risk management and internal control systems to safeguard the interests of CLAR Group and its stakeholders. • Approve CLAR Group’s risk appetite (risk tolerance) which determines the nature and extent of material risks that CLAR Group is willing to take to achieve its strategic objectives. • Oversee implementation of risk frameworks and policies. • Regularly review CLAR Group’s risk profile, including financial and non-financial risks, and mitigation strategies that arise from business activities. Management • Accountable to the Board, through the ARC, on all risk-related matters. • Monitor key risk indicators and metrics and ensure timely and regular reporting to the Board. • Maintain escalation process to provide transparency and confidence that material risks are actively managed. Three Lines of Defence All employees have individual accountability and clearly defined ownership and responsibilities, with strong enterprisewide risk culture as the foundation. 1st Line – Business & Operations • Primary risk owners are accountable for effectively identifying and managing risks arising from their business activities. • Conduct forward-looking risk assessments, which cover a broad spectrum of risks, to support informed decision-making and responsible risk-taking. • Implement controls to manage the day-to-day business risks and ensure compliance with regulations, ethical expectations and Group-wide polices. 2nd Line – Risk Management & Specialist Functions • Risk management and specialist functions include Legal, Compliance, Digital & Technology and Sustainability, who are independent of the business units. • Provide risk oversight and necessary checks and balances through monitoring and reporting processes. • Foster a strong risk culture through ongoing training, guidance and communication. 3rd Line – Internal Audit & External Audit • Internal and external audit provide independent assurance on the adequacy and effectiveness of risk management and internal control systems.
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