Risk management

Risk management is a systematic way of protecting business assets and income against losses in order to achieve the Company's targets without unnecessary interruption. Risk management also includes risk-taking. That means utilisation of opportunities, taking into account the risk-reward ratio and expectations in each case.

The objective of risk management is to enable the Company to implement its strategy, to ensure it achieves its financial targets, and to protect it from operative incidents, which might prevent it from achieving its targets. A further objective is to ensure the continuity of the operations even in an exceptional business environment.

The main risk areas of the Company have been identified and assessed. The Company applies risk identification and assessment process covering all Business Divisions and selected functions. Risks are identified based on each divisional or functional management team's knowledge of its business and area of responsibility. The main principle is to manage risks at their source within the business unit, plant or function where risks may occur. Risk ownership, including monitoring actions for the assessed risks, are defined and carried out by the appropriate management at different levels of the Company. Vice President, Treasury is responsible for the overall process and consolidates the results at Group level.

Vice President, Treasury is responsible for providing support to the ExCom in developing risk policies and guidelines, as well as for establishing assessment, monitoring and reporting procedures. He/she provides support to the Business Divisions, units and functions by providing assistance and training. He/she is also responsible for establishing and maintaining the Company's global commercial insurance programs.

A summary of risks associated with business are described in the Annual Report in the section "Review by the Board of Directors".

Financial Risk Management related notes can be found in the Annual Report in the section "Notes to the consolidated financial statements".