Study Of Total Risk Management In ZG Financial Leasing Co. Ltd

ZG Financial Leasing Co., Ltd. (ZG Leasing Company) is a foreign-invested financial leasing companies approved by the Ministry of Commerce. Based on many years of financial services firms to explore, excellent team of financial professionals, improving the service support system and a strong financial institution partners, ZG Leasing Company now supplies more than 3,000 clients with financial leasing services, and strives to become the leading manufacturer future integrated financial services provider. Risk control is the core business of financial leasing. Due to the establishment of a short time, ZG Leasing Company risk management experience is not rich, and risk management work is at the exploratory stage. Especially in the current environment of the Downward real estate industry, building a perfect system of comprehensive risk management system is necessary and urgent.In this paper, we analyze the status of ZG Leasing Company’s risk management around the eight elements of COSO—ERM risk management framework, using a comparative analysis and interviews investigation method. Seven problems of it are pointed out as below. The first, risk management system is imperfect, and there is no set up directly under the board’s risk management organization. The second, the organization is lack of independence of the audit and departmental responsibilities are not clear. The third, the risk culture and employees risk prevention consciousness need to be strengthened. The forth, personnel training system is unreasonable, especially lack of risk management, auditing, information technology professionals. The fifth, the risk management process is imperfect, and risk identification is relatively rough. Effective risk assessment criteria and response measures are not comprehensive. The sixth, the risk management information reporting system and regular communication mechanism is not perfect. The risk information can not be fully integrated, resulting in not forming a system of risk information communication mechanism. The seventh, due to a single means of communication and supervision, the employees does not strictly enforce the standards of internal processes, resulting in control failure.In response to these problems, develop solutions to optimize risk identification and response. First, use flow analysis method to identify 12 categories risks and 55 segments risks. Then, through in-depth interviews and investigations, optimize risk assessment criteria and identify 12 key risks, including the risk of decision-makers, the risk of employees instability, the risk of lack of key personnel, the risk of non-standard audit procedures, the risk of the lessee without ability to repay, the risk of lessees disposal of rental equipments, the risk of inadequate rental equipment market, the risk of single financing, the risk of internal processes lax standards, the risk of tax policy, the risk of imperfect credit reports, the risk of information system operation. Finally, for 12 key risks, analyze the causes and put forward specific countermeasures.At last, four specific protection measures are given about the implementation of company-wide risk management as shown below. First, through setting up the Risk Management Committee, expanding the functions of the Risk Management Department, adjusting the department set and other means, establish the Risk Management Committee, Project Evaluation Committee, Risk Management Department multi-level risk management system, and maintain the independence of audit institutions. Secondly, strengthen the company’s risk culture and employees’risk prevention awareness, introduce high-level personnel, train internal staff, and establish a talent ladder system to provide back-up personnels for the risk management team. Again, enhance communication with external lessees and promote the exchange of information internal staff. Through information technology platform, promote the risk management information system to develop. Finally, further promote the standardization of the company and focus on improving the financial leasing business operation processes. Establish customer credit rating system and early warning mechanism, audit focus areas, and build monitoring mechanism, in order to ensure the normal development of the company.