The Research Of Comprehensive Risk Management In Jining Power Supply Company

A power supply company is a public utility enterprise which bears the basic mission of supplying safe, economic, clean and sustainable power, and is related to national energy security, the lifeline of the national economy and people’s livelihood. Its security and stability is highly concerned by all aspects of society. Thus risk management has become its core competence and basic condition for survival. Jining Power Supply Company, an extra large state-owned enterprise belonging to Shandong Electric Power Corporation, has fully realized the importance of risk management. In the course of building the system of risk management and internal control, it has not only made some achievements and effectiveness but also encountered many problems.Using comparative analysis and interviews investigation, this thesis analyzes the said company’s risk management considering the eight elements in COSO-ERM risk management framework. Ten problems are pointed out as below. First, a defective organization and the lack of overall planning. Second, the absence of a global and systematic risk culture system. Third, the shortage of professional talents due to insufficient specialized training. Fourth, the lack of an effective reporting mechanism which provides accurate, reliable and systematic risk information for decision makers. Fifth, incorrect assessment due to poor risk identification and scoring standards. Sixth, speciality limitations and strong subjectivity in determining major risk factors. Seventh, inefficient risk response due to the lack of cooperation. Eighth, poorly-developed monitoring and balance mechanism. Ninth, the lack of risk management regular meeting. Tenth, the lack of risk management, monitoring and evaluation.Given the above problems, this paper proposes an optimization scheme of risk identification and risk assessment. A more comprehensive risk assessment index system is established using process analysis. A mathematical model for risk assessment is built using the analytic hierarchy process and entropy weight determination. The scoring method is optimized and the scoring criteria are elaborated. After that, risk assessment is carried out for Jining Power Supply Company by means of a survey. The score indicates the company is at a lower risk level. Based on this, seven key risks are identified by the score of indicators and the response measures are given.At last, to deepen the implementation of company-wide risk management, five specific protection measures are put forward as shown below. In the first, to determine the oversight role of an overall risk management, the risk management committee and a separate risk department need to be established. The "three lines of defense" of comprehensive risk management should be formed. The second, the construction of risk management culture should be promoted from the "point","line" and "face". The third, we should reserve human resources by introducing, training and selecting talents. The fourth, Risk Management Information Systems should be constructed so as to realize information sharing and a whole-process control. The fifth, the assessment and monitoring mechanisms should be established and improved. So, the risk management and internal control are integrated effectively.In this thesis, a comprehensive risk management system is suggested for Jining Power Supply Company. It provides a reference for other power supply companies in terms of comprehensive risk management.