Risk Management

As a global company, JLT faces a range of risks, each of which has the potential to impact on the achievement of our strategic business objectives as well as providing opportunity in the right circumstances.

JLT International Control Framework


JLT Three Lines of Defence

The Group operates a 'Three Lines of Defence' (3LOD) model as a core component of its governance arrangements, as shown above. The current 3LOD model has been in place and operating for five years across the Group, and has been subject to iterative enhancements during that time. JLT completed an internal review of its 3LOD model in the UK businesses during 2016, building upon the solid governance framework already in place. 

JLT successfully implemented the recommendations of the review during 2017, which were focused on delivering: 

  • enhanced accountability and ownership of risk within the businesses, ensuring that the right people with the right skills are available to the businesses and close to decision making processes;
  • clear, skilled roles for the control functions in the second line of defence, providing specialist advice and strong oversight to the businesses internationally; and
  • an enhanced focus on risk management disciplines across the business.

In early 2017, JLT also completed a review of its international 3LOD model, which resulted in a number of enhancements being rolled out during the year, including:

  • designating all international local risk and compliance teams as 1st Line of Defence ('1LOD'), clarifying their role and responsibilities, and ensuring a clear delineation from the 2nd Line of Defence ('2LOD'); and 
  • strengthening the 2LOD support and oversight of international operations.

The principal risks faced by the Group are summarised in the table below.

Principle Risks

Principle Risks

Principle Risks

More detail can be found in the 2016 Annual Report, in the Audit & Risk Committee Report.