Improving Confidence in the Commodity Markets

Complexity and significant operational risks are part and parcel of trading commodities because of their labyrinthine value chains and unique physical attributes. Managing these inherently complex operational risks is essential, particularly in the light of massively increasing scrutiny from all sides of the industry, including regulators, stakeholders and financing banks. Unfortunately, the industry has a history punctuated by failures and deficiencies ranging from the fraudulent activities that resulted in the collapse of Enron to the recent Qingdao scandal, amongst others whose reverberations have yet to be fully appreciated.

This white paper examines the increasing importance and scrutiny around managing operational risks and unlocking new opportunities across the commodity value chain.