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Barnett Waddingham
0333 11 11 222
In line with risk reporting requirements and guidance set by the Financial Reporting Council (FRC), organisations are beginning to introduce stress testing techniques to support long term viability statements required of premium listed organisations. This gradual trend towards quantitative methods related to risk management is a welcome development for the industry but importantly, the benefits and application of such techniques go significantly above and beyond compliance. 


We combine practical risk management expertise with the analytic rigour of our actuaries, to help organisations develop, apply and interpret these methods and embed capability. We can facilitate discussions to develop scenarios and work with clients to formulate assumptions, produce bespoke mathematical models and templates for sustainable solutions, and help to embed risk and stress testing analysis as a strategic tool during decision making.

We can help:

  • Validate/develop financial model
  • Define risk tolerance using our model
  • Broaden understanding of risk appetite
  • Define/validate scenarios and assumptions
  • Explain ‘So what’ in simple language

So what?

  • Viable business?
  • Do we understand the risks we face
  • Should (can) we take more/less risk?
  • Should we strengthen balance sheet and credit facilities?
  • Should we adjust insurance limits of coverage?
  • Should this form of risk analysis be included when deciding strategic/investment options?

Case Study - Stress Testing as a Strategic Tool

We worked with a FTSE250 non-Financial Service organisation that we consider to be leading the way, in terms of stress testing.  This was used as a tool to support their long term viability statement and further gave their board the confidence to continue its growth strategy.

Providing an independent review of the stress testing exercise not only offered recommendations to continue refining its mathematical robustness, but also offered ideas on creating better engagement with the exercise. This identified the potential to evolve this into a tool to assess M&A options and other investment case opportunities thereby, putting risk analysis in the heart of strategic decision making. 

The review also identified the link to risk appetite and tolerance, which if well understood, helps them interpret the acceptability of results of their stress test.


"I have found Barnett Waddingham’s professional and friendly approach to be very engaging. They assisted us with some work regarding our Long Term Viability Statement (LTVS) and the stress testing required to support it.  Their thought leadership has been encouraging, insightful and well presented."

- Head of Risk and Insurance, FTSE250 Organisation


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