Risk management
Outokumpu operates in accordance with the risk management policy approved by its Board of Directors. The policy defines the objectives, approaches and areas of responsibility of risk management activities. As well as supporting Outokumpu strategy, risk management helps in defining a balanced risk profile from the perspective of shareholders and other stakeholders such as customers, suppliers, personnel and lenders.
Outokumpu has defined risk as anything that could have an adverse impact on activities that the company is undertaking to achieve its objectives.
Definition of risk
Outokumpu has defined risk as anything that could have an adverse impact on activities that the company is undertaking to achieve its objectives. Risks can therefore be threats, uncertainties or lost opportunities that relate to current or future Group operations.
Outokumpu's appetite for risk, and risk tolerance, are defined in relation to Group earnings, cash flows and capital structure. Risk management is part of the Group's management system and is divided into four stages: identifying risks, risk evaluation, risk control and mitigation, and risk reporting.
Risk management organisation
The Outokumpu Board of Directors is ultimately responsible for risk management within the Group. The CEO and The Group Executive Committee are responsible for defining and implementing risk management procedures, and for ensuring that risks are both properly addressed and taken into account in strategic and business planning. Business units and Group functions are responsible for managing risks connected with their own operations.
External auditors and Internal Audit monitor the risk management process, while the Group Executive Committee, the Audit Committee and the Board of Directors review key risks and actions taken to manage risk on a regular basis. The Treasury and Risk Management function supports implementation of the Group's risk management policy, facilitates and coordinates risk management, and prepares quarterly reports on risk for the company's management and auditors.