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Advisory Solutions

Risk Management for Competitive Advantage:
At WCI, we view risk management as a proactive, value-add activity that can be structured to improve the client's overall financial performance. To help clients achieve their objectives, our advisory role typically concentrates within the core sales and trading activities of a company.   We combine this operational focus with developing robust strategies toward price risk management incorporating the company's relevant operations. Our activity focuses on four primary areas:

  • Review the overall risk appetite and exposure; then validate an appropriate risk management strategy for execution
  • Physical contract management
  • Commodity and trade finance terms
  • Forward pricing agreements

  Engagements undertaken by our consultants can cover one or more of the following topics:

  • Assess, develop, implement and review the commodity price risk strategy. Support the company to establish an appropriate risk appetite level and identify price risk embedded within the business. Once we have quantified the exposures, we then seek to assess, control, report and manage the process.
  • Evaluate terms and conditions of physical contracts to ensure that contracts meet financial performance expectations outlined under the strategic plan.
  • Derivative contract management. Review and execute a company's fixed forward rate pricing contract strategy. Evaluate appropriateness of using specific derivative positions for hedging effectiveness. Review criteria for deals, including, if required; (i) securing future cash flows, (ii) avoiding adverse price changes or, (iii) supporting a client's customers' pricing requirements.
  • Evaluate optimal levels for commodity inventories held by client and how best to finance these materials. This covers raw material commodities and post production semi or finished products.
  • Review internal compliance on policies regarding relevant regulatory controls that govern derivative trading. Ensure that trading activity conforms to corporate governance policies and is within compliance on legal, regulatory, and accounting rules.