Housing Australia maintains a robust risk management framework to support the effective delivery of the Government’s housing programs. We take a structured and disciplined approach to identifying, assessing and managing risk across all areas of our operations. This supports good decision-making and helps ensure we meet our obligations while protecting public resources.
Housing Australia’s Risk Management Governance Framework
Risk governance
The Board is responsible for defining the level of risk Housing Australia is willing to accept as part of delivering on our Australian Government mandate as part of our organisational risk appetite. They approve the Corporate Plan and establish the risk management framework. Housing Australia’s executive leadership team manage the implementation and embedding of risk appetite in Housing Australia’s activities and monitor performance and report as appropriate to the Audit and Risk Comittee and/or Board.
The Board annually engages an independent auditor to review Housing Australia’s risk management approach, including risk assessment and control effectiveness. Audit reports are submitted to the Board through the Audit and Risk Committee and the Executive Risk and Compliance Committee.
Auditors are provided with access to employee and organisational data to support their reviews.
Risk culture
Housing Australia’s risk culture and principles guide everyday behaviour in the organisation.
Housing Australia strives to:
- Maintain the highest professional and ethical standards focusing on embedding appropriate behaviours
- Align employee remuneration and other benefits to encourage behaviour consistent with good governance and Housing Australia's risk appetite
- Provide an environment where employees are empowered to the full extent of their abilities and that fosters innovation and learning within business practices
- Monitor, stress test and re-evaluate risk ensuring management information systems and risk reporting accurately reflect the underlying risk
- Maintain compliance standards reflecting zero tolerance of regulatory and compliance breaches.
Risk appetite
Risk appetite is a fundamental part of both risk and capital management.
The Board’s Risk Appetite Statement sets the boundaries for the risks that Housing Australia may accept to achieve its objectives within risk policies, risk tolerances and operational limits set by the Housing Australia Act, Investment Mandate, PGPA Act and the Board.
Housing Australia's risk appetite represents the types and degree of risk that it is willing to accept for its stakeholders in its strategic and business actions.
Housing Australia’s risk appetite is:
- Dynamic. Regular Board reviews ensure alignment with the Corporate Plan and Government policies, such as the Investment Mandate
- Defined. Clear tolerances and governance procedures guide decision-making and compliance
- Encompassing. A structured framework shapes the internal risk culture, using both quantitative and qualitative metrics to provide comprehensive oversight
- Judgement based. We carefully weigh diverse perspectives, ensuring risk decisions reflect strategic judgment.
Risk control and measurement
Housing Australia follows established risk review procedures to ensure that we have a consistent view of the risks we face. Information on significant risks, collected through this process, is reviewed by senior management prior to being reported to the Board and Audit and Risk Committee (through the regular provision of the risk dashboard and RCM).
Risks are classified depending on their nature. Housing Australia’s key risks fall into the following risk categories (as described further in the table below).
| Risk | Definition |
|---|---|
| Financial Risk | Risks such as market risk, credit risk, counterparty credit risk, liquidity risk, funding risk or other financial risks relevant to the organisation's investment activities |
| Legal and Compliance Risk | The risk of legal or regulatory sanction, financial, reputation loss arising from failure to abide by obligations required of the organisation |
| Operational Risk | The risk of loss resulting from inadequate or failed internal processes, people, and systems or from external events |
| Reputational Risk | The risk of damage to the organisation's or the Commonwealth Government's standing, trust, or credibility with stakeholders, including Parliament, ministers, the public, investors, and counterparties |
| Shared Risk | The risk that the organisation may not be able to deliver functions and services within set timeframes due to underperformance by Shared Risk providers |
| Strategic Risk | The risk of threats or uncertainty that can affect Housing Australia ability to deliver its purpose and objectives as set out in its enabling legislation, Investment Mandate and corporate plans |