As a structured and systematized approach, risk management is integrated in the Company’s strategic planning and operational management procedures, and relies on the commitment of all employees to adopt risk management as an integral part of their duties, notably by identifying, reporting and implementing risk mitigation measures and behaviours.
Risk Management is sponsored by the Executive Committee in articulation with the management teams for the various businesses, at national and international level, in such a way as to identify, assess and manage uncertainties and threats that might affect the pursuance of the plan and compliance with strategic goals.
The Internal Audit and Risk Management functions, with hierarchical reporting to the CEO and CFO and functional reporting to the Audit Committee, support the Company’s Executive Committee in implementing the risk management system and permanently assessing risk management procedures in place, in order to ensure the following goals:
- Implementation a corporate risk management model in line with the PT Group’s strategic goals;
- Identification and analysing the main risks to which PT and its subsidiaries are exposed within the framework of the conduct and pursuance of their business;
- Identification and analysis of the main risk factors and events that may significantly affect operation in the normal course of PT and its subsidiaries in terms of:
- Probability of occurrence;
- Associated control level and response capacity in a crisis;
- Speed at which the risk or event may materialize;
- Identification of improvements in control and follow-up of mitigation plans associated to critical risk factors;
- Improve the quality of information supporting the decision-making procedure;
- Communication of the results of the risk management process and warnings in the event of occurrence or identification of new critical risks.
It should also be mentioned that the whole process is monitored by the Audit Committee, an independent supervisory body composed by non-executive independent board members. During the exercise and enforcement of its duties, regarding the oversight of the quality, integrity and efficacy of the Company's risk management system, the Audit Committee is responsible for the following:
- Supervise the adoption of principles and policies for identification and management of the main risks of a financial or operational nature or other relevant risks in connection with the PT Group’s business, as well as of measures intended to monitor, control and disclose such risks;
- Evaluate, each year, all internal procedures on the matters of risk detection and Company asset safeguard;
- Monitor the analysis, revision and implementation of measures and plans in order to follow up, improve and/or correct the internal control system and the measures and plans proposed within the framework of the Company’s risk management systems.