2021 INTEGRATED REPORT

Thanks to its proven effective risk control in all its activities and its solid culture of compliance, the Group has been able to support its customers and finance their investments, despite uncertainties related to the persisting health crisis.

The identification and anticipation of the risks to which our Group may be exposed is central to our framework, in order to protect our activities. Particular attention is paid to major and emerging risks.

Major risks include those that are likely to arise in the short term and may have a material impact on the Group’s financial results, reputation or sustainability. They may be related to the macro‑economic environments in which we operate, such as increased debt; the regionalisation of trade, due in particular to the possible relocation of production lines to developed countries; or changes in laws and regulations applicable to financial institutions. To be added to this landscape are risks related to political instability in some countries or the increase of cyberattacks and the acceleration of technological change.

Emerging risks are new and/or evolving risks. While their impact may be significant in the future, they are currently difficult to quantify and precisely assess. Among them are technological innovations, regulatory changes, health threats, climate change as well as demographic and societal changes.

A continuously improved internal control system

To keep growing while maintaining the trust of our customers and partners, our internal control system must be effective and efficient at all times. Based on six transversal functions ‑ LEGAL, Compliance, RISK, Tax, Finance, and Inspection Générale ‑ the system leverages on rigorous policies and procedures, while also being complemented by an ever more disciplined compliance culture. Our objectives? Further improve our operational model to fight money laundering, terrorism financing and corruption; increase compliance with international financial sanctions; and bolster online training programmes for all our employees. Combined with our strategy of diversifying our loan portfolios, this risk management policy contributes directly to BNP Paribas’ solidity.

THIS IS THE COST OF RISK IN 2021,
at a low level and down by 32 points compared to 2020.