Presented by: WWW.ALEXANDERHAMILTONAWARDS.COM

Developing a Risk Intelligent Organization

Presented by:

Mission: Connect Everything. Empower Everyone

2011 Revenue: $4.5 Billion

Global Presence: Offices In 46 Countries

9400 Employees

#3 In Edge Routing, Ethernet Switching

#2 In Core Routing, SP Routing, Network Security

#1 In High-end Firewall

Doing Business With 100% Of Fortune 100

Powering 6 Of The World’s 7 Largest Stock Exchanges

Presented by:

Issue: Enhancing Oversight for Risk

Issue Objectives Key Questions

Provide greater risk oversight to protect and

enhance shareholder value while making the

right trade-offs between risk and reward

• Fulfill BOD, Legal and Regulatory

Requirements (NYSE, S&P, etc…)

• Be pragmatic • Leverage best practices

• Build a more risk intelligent culture

• Who manages risk? • How do we define risk? • What oversight for risk exists at the BOD level?

• How do we assess risk? • Is there a best practice? • What are other public

companies doing? • Can we leverage work?

Presented by:

Problem: No One Best Approach to ERM

ERM

COSO

ISO 31000

Basel II

Australian and New Zealand

Standard 4360

Consultants

… Juniper Networks evaluated common elements and adapted a model to fit our unique culture…

GRC

Presented by:

Solution: Building a Sustainable Risk Management Framework

Risk Infrastructure

Risk Ownership

Develop risk governance model

Identify Risks from defined risk register

Develop risk universe

Define risk prioritization criteria

Assess and prioritize risks

Identify risk owners

Identify drivers & mitigation

Integrate with corporate processes

Develop risk monitoring/reporting

Integrated Risk Management

Approach

Risk Governance

Source: Juniper Networks adapted a model with Deloitte Consulting which focuses on governance and enhancing risk intelligence. This model captures many of the common elements of other published ERM and governance models.

Presented by:

Solution: Develop Clear Roles & Accountability

Risk Infrastructure

Risk Ownership

Risk Governance

Risk governance includes risk oversight and strategic decision-making. It defines the parameters of acceptable risk, monitors strategic alignment, and sets overall risk management expectations. Juniper established Risk Management Committee and Working Team consisting of leadership across the company to drive the program.

Risk infrastructure includes designing, implementing, and maintaining an effective risk management program and is composed of the three “pillars of people, process and technology” and is the essential link between risk governance & risk ownership.

Risk ownership is what risk governance relies on to execute Risk Intelligence. It includes all of the functions’ and business units’ responsibilities with regard to identifying, evaluating, mitigating, and responding to risks in accordance with risk governance mandates. Risks are owned by individuals and interdependencies identified. If appropriate, risks are aligned to corporate scorecards and objectives.

Juniper’s Integrated Risk Management

Approach

Presented by:

Integrated Risk Management

STRATEGIC OPERATIONAL/

INFRASTRUCTURE FINANCIAL

• Risks arising from the Company’s inability to formulate a successful business strategy and achieve its long-term objectives.

• Risks arising from the Company’s inability to effectively manage business assets – people, processes and systems – and products and customers – to achieve successful execution of the Company’s strategies.

• Risks arising from our inability to effectively forecast, manage and report financial components – to achieve successful execution of the Company’s strategies.

COMPLIANCE

• Risks arising from our inability to comply with laws, regulations, key Company policies and contractual obligations.

Risk is the potential for loss or the sub-optimization of gain…

Risk Management Committee Compliance & SOX Committee

Governance, Risk Management & Compliance of Juniper’s Risks

Internal Audit

Presented by:

Risk assessment and prioritization…

Disclosed Risks 10K/10Q Analysis

Sector Reports

Risk Prioritization

Input from key executives

Working Team’s Knowledge of Risk

Juniper Networks Strategic & Operational Risks

Presented by:

Continuous measurement

Stak

ehol

der

valu

e Integrated

Strategic/Risk Optimization

Risk Awareness/

Specialist Silo Initial Silos Future State

… Juniper Networks evaluated our program’s maturity level using a simple 9-point diagnostic.

Presented by:

Benefits to Juniper Networks Direct

Enhanced oversight and transparency for risk at the Board and Executive Management level

Framework to discuss risk across the company Prioritized resources on top risks Aligned corporate strategy to top risks Accountability for mitigation with one risk

owner

Indirect Negotiating better risk management

programs for operational risks Focus limited resources (i.e., people

and finances) on critical priorities Promote Treasury’s role on Balance

Sheet Protection & Risk Optimization Leverage and utilize the work on ERM

to external companies including insurance companies, rating agencies, and other financial institutions

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Thank you…

Q&A