SGL Group’s risk management is essentially based on two interrelated systems:
- Risk Management System (RMS)
- Internal Corporate Auditing
Risk Management System (RMS)
Our risk management system (RMS) is comprised of a series of interlinked planning, monitoring and information systems which cover all areas of the Company, and are continuously adapted to changes in the competitive environment.
The operating units and central service functions are responsible for identifying their key risks during the planning process including financial impact and initial probability of occurrence. At the annual Objective Discussions with the Board of Management, all risks are examined, and countermeasures are agreed upon.
The risks are monitored by the operating units on a quarterly basis including identification of new risks and review of countermeasures. Group Controlling consolidates the operational risks for discussion by the Board of Management in order to focus on early recognition of material risks for the entire Company.
For its part, the Board of Management informs the Supervisory Board about risk development and risk management at regular intervals. In addition, the Internal Audit department, which is independent of these processes, examines all components of the risk management system at appropriate intervals. The areas of responsibility for risk management are set out in Group guidelines.
Internal Corporate Auditing
The Group’s Corporate Audit department reviews on behalf of the Board of Management especially the following issues throughout the Company:
- adherence to directives, guidelines, and approval limits;
- asset security;
- organization and processes with respect to efficiency, effectiveness and propriety;
- functionality and reliability of the risk management system and
- reliability of reporting.