We have a robust risk management process in place to identify, monitor and mitigate risk and to identify opportunities. This means first determining risk appetite, and then identifying the key risks.
Managing business risks
Managing risks and opportunities is a key consideration in both determining and delivering the strategy. This approach to risk management is not intended to eliminate risk entirely, but provide a means to identify, prioritise and manage risks and opportunities and enable the Group to effectively deliver its strategic objectives in line with the Group’s appetite for risk.
Strategic objectives in the form of KPIs are set annually. Determining the level of risk the Group is willing to accept in the pursuit of these objectives and then identifying and managing these risks and opportunities to an acceptable level is a fundamental component of the Group’s risk management framework.
The Group’s framework for risk management promotes a bottom-up approach to risk management with top-down support and challenge. The risk register is central to the risk management process and forms the basis for capturing and discussing risk throughout the organisation. Risks and opportunities are identified, assessed and managed at an asset, project and functional level. Reporting of these risks within the organisation is structured so that risks are escalated through various internal management and Board committees and, when appropriately material, to the Board itself.
The Board has overall responsibility for ensuring the Group’s risk management and internal control frameworks are appropriate and embedded throughout the organisation. Principal risks are reviewed at each Board meeting and, at least once a year, the Board undertakes a risk workshop to complete a robust assessment of the principal risks. This includes determining and setting the Group’s risk appetite and associated tolerance levels which are considered acceptable in the pursuit of strategic objectives. This integrated approach to risk management has been and continues to be critical to the delivery of strategic objectives.