Measures

AEGON frequently reviews the functioning of its risk management framework, and decided recently to introduce a number of measures aimed at further strengthening the company's approach.

This approach is based on having three so-called 'lines of defense':

• Line management
• AEGON's risk function, both at Group Risk and at individual country and operating units
• Internal and external audit.

AEGON intends to further strengthen these lines of defense by:

• Clarifying the role and accountability of senior management for risk-taking (first line of defense)
• Ensuring the company's risk function provides independent oversight for relevant management decisions (second line of defense)
• Audit will continue to offer independent assurance of AEGON's risk management processes and controls (third line of defense)

As a result of these changes, AEGON's Group Risk & Capital Committee (GRCC) will focus increasingly on the overall management of the company's balance sheet, within boundaries set by AEGON's risk tolerance levels and risk policies.

AEGON's Chief Risk Officer will continue to attend all meetings of the GRCC, but will report directly to the Executive Board on matters such as compliance with existing risk policies, risk exposures and potential threats to the company's solvency or its operations.

The Executive Board will retain its overall responsibility for risk management, including AEGON's risk governance framework, its risk tolerance and policies, and the risk culture within the organization.