SABAF - ANNUAL REPORT 2016
CHAPTER 3 - RISK MANAGEMENT
Risk Management Framework In conducting its business, Sabaf defines strategic and operational objectives, and identifies, assesses and manages the risks that could prevent these from being met In recent years Sabaf has progressively explored the concepts of risk assessment and risk management in order to develop a structured and regular process of risk identification, assessment and management, defined and formalised in Guidelines contained in the Company’s Corporate Governance Manual.
Business Analysis Analysis of Organizational Structure Catalogue of risks
Operational Guidelines: “Process of periodically identifying and measuring Sabaf Group risks”
RISK MANAGEMENT FRAMEWORK
RISK MAP
Risk Assessment Scales
The guidelines define the roles and responsibilities for risk assessment and risk management processes, indicating the parties to be involved, process frequency and assessment scales. Each risk is subject to an assessment which breaks down into the following variables:
RATING SCALES
-- probability of occurrence over a three-year time frame; -- estimation of the greatest impacts in terms of the financial position, damage to persons and damage to image, over the time frame subject to assessment; -- level of risk management and control.
1
2
3
4
1% Ebit
1% - 2.5% Ebit
2.5% - 10% Ebit
10% Ebit
Limited health effects
Medium health consequences
Serious health risks
Non-reversable effects
Effects at the local level
Effects at the regional level
Effects at the national level
Effects at the international level
Once every 3 years or more often
Once every 2 years
Once every 1 year
Several times each year
Qualitative indications
Unlikely/Remote
Not likely
Likely
Very likely
RISK MANAGEMENT LEVEL
Unsatisfactory
Needs Improvement
Adequate (with limited room for improvement)
Optimal
IMPACT
Economic and financial losses
Bodily injury
PROBABILITY
Damage to image
Frequency of occurrence
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