Managing risks is a very high priority within FLSmidth
Risks are an integral part of our business with a constant evolving risk exposure. It requires a robust governance model and top management involvement to ensure that risks are minimized and mitigated while at the same time focusing on turning risks into opportunities where possible.
Risk management framework and process
Group Executive Management leads our risk management programme, with oversight from the Audit Committee and ultimately the Board of Directors having the overall responsibility for deciding the risk appetite and monitoring the risk exposure.
Through a bottom-up approach, risks are assessed by the Business Lines and Shared Functions during workshops facilitated by Group Risk Management. This enables the collection of a broad spectrum of data across the organisation and identifies the biggest risks for FLSmidth.
Based on this assessment, Executive Management identifies high-risk issues for the coming year and ensures that actionable mitigation plans are in place. In addition Executive Management reviews the mid and long term risks to ensure proper mitigation and attention.
During the year the Risk Committee meets to review the top risks and follow up on mitigation plans. This ensures that ownership for managing the risks is anchored in the business and that the focus on proactively identifying, managing and mitigating the risks continue throughout the year.
Top Group Risks for 2023
During 2023, we have seen the political environment further exacerbate risks we were already aware of both geopolitically and locally in the regions. Political friction continues as does concerns about climate change, while the green transition in both industries continues at a slow pace.
2024 will see continued focus on improving project execution with clearly defined best practices for handover throughout the entire project value chain from sales to execution to service, aligning project roles across functions with improved communication and accountability.
- Market trends
- Geopolitics (Global & Regional)
- Green transition
- Attract/retain employees
- Employee health & safety
- Cyber security