Risk identification and assessment play a vital role in the success of internal control. In order to control the effectiveness and profitability of its operations, the Group must be able to manage risks. Raisio’s internal control is to provide the management with assurance that the established risk management policy is followed.
Raisio’s risk management policy defines the objectives, principles and responsibilities of risk management. Risk management is defined as an activity aimed at identifying and assessing significant external and internal uncertainties that may threaten the strategy implementation and target achievement. Identified risks are eliminated, avoided, reduced or transferred to the extent possible. Raisio’s risks fall into strategic, operational, damage and financial risks. Special emphasis is placed on preventive action and its development. Risk management is part of the Group’s day-to-day operations and decision-making. Damages caused by products with inadequate safety and related liability risks are a key issue in the risk management of the Group producing foods and feeds.
The Group’s financial administration is responsible for coordinating, developing and monitoring risk management. External advisors are also used, when necessary, to develop risk management activities. The Group’s financial administration is responsible for the Group-wide insurance schemes. Their scope is assessed, for example, in conjunction with risk surveys carried out at company sites.
Each Division conducts its practical risk management in line with the risk management policy and the guidelines established by the Group’s financial administration. Operative responsibility is held by the management of each Division and function. The Divisions survey and identify risks in connection with budgeting and financial reporting, among other things. The Group is prepared for operations in crises and for crisis communication.
Each Division and service function, including financing, reports on its main risks to the Group’s CFO, who then reports on the risks to CEO, the Group Management Team and the Board of Directors.