» Risk Management

Furthering the protection of Libya’s assets

Our Risk Management Framework

Risk is an integral part of investment. It is characterised by uncertainty, and is measured in terms of the potential impact of an occurrence and the likelihood of the event taking place.

The Libyan Investment Authority (LIA) is entrusted to protect and grow the wealth of the Libyan people for future generations. To achieve this, we must proactively manage risks.

We understand the importance of holistic risk management, to comprehensively identify and analyse all types of risks across asset classes, as well as ensure that any potential issues are mitigated and managed efficiently.

We are committed to a strategy that supports the identification, measurement, monitoring and reporting of key risks; and uses the information gathered through this process to enhance our decision-making.

Our investment approach is underpinned by a prudent risk management framework, which is based on the ‘Three Lines of Defence’ model.

Three Lines of Defence

LIA board of directors

Responsible for approving investment policy statment & risk appetite statment

Audit, Risk & Compliance Committee (“ARCC”)

Maintain oversight and monitor effectiveness of three lines of defence model

Risk Management

  • 1ST
    LINE

    BUSINESS OPERATIONS

    Establish a departmental control framework

  • 2ND
    LINE

    CONTROL FUNCTIONS

    Strategic management, policy & procedure setting and functional oversight

    • 1ST
      LINE

      BUSINESS OPERATIONS

      Establish a departmental control framework

    • 2ND
      LINE

      CONTROL FUNCTIONS

      Strategic management, policy & procedure setting and functional oversight

    • 3RD
      LINE

      AUDIT

      Provide independent challenge and assurance

      3rd
      LINE

      AUDIT

      Provide independent challenge and assurance


      Ultimately, we strive to achieve long-term stable financial returns within this strictly defined risk framework.

      The LIA’s investment decisions are based on our economic objectives as set out in Law No. (13) and our obligations under the United Nations Security Council Resolution 1970 of 2011.

      Our Approach to Risk


      Our risk management approach is supported and reinforced by the continued emphasis on risk awareness throughout our organisation.

      We are focused on maximising our ability to deliver the LIA’s strategic objectives, promoting sound decision-making, and safeguarding the LIA and our employees.

      RISK GOVERNANCE

      Our Board of Directors maintains full control and oversight of our risk framework and risk-return objectives; while our Audit, Risk & Compliance Committee is responsible for regularly monitoring and evaluating the effectiveness of our risk management framework, policies and practices.

      RISK CULTURE

      All LIA employees have a critical role to play in maintaining an appropriate risk environment. We are committed to providing widespread training and education for our employees regarding risk management, and employees are expected to demonstrate the highest standards of ethics, integrity and professional competence.

      RISK APPETITE

      Our investment decisions must prioritise the long-term, while keeping in line with our founding laws and international best practices. The specific amount and types of risk the LIA is willing to take in order to meet its strategic objectives is defined in our Risk Appetite Statement.
      • RISK GOVERNANCE

        Our Board of Directors maintains full control and oversight of our risk framework and risk-return objectives; while our Audit, Risk & Compliance Committee is responsible for regularly monitoring and evaluating the effectiveness of our risk management framework, policies and practices.
      • RISK CULTURE

        All LIA employees have a critical role to play in maintaining an appropriate risk environment. We are committed to providing widespread training and education for our employees regarding risk management, and employees are expected to demonstrate the highest standards of ethics, integrity and professional competence.
      • RISK APPETITE

        Our investment decisions must prioritise the long-term, while keeping in line with our founding laws and international best practices. The specific amount and types of risk the LIA is willing to take in order to meet its strategic objectives is defined in our Risk Appetite Statement.

        © 2022 LIA,  ALL RIGHTS RESERVED.

        © 2022 LIA,  ALL RIGHTS RESERVED.