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Risk Management

Key Risk Management Principles

Luotea has a defined risk management process that includes a review of financial, strategic, operational and damage-related risks. 

Risk management at Luotea aims to identify significant risk factors, prepare for them and manage them in an optimal way so that the company’s strategic and financial objectives are achieved. Comprehensive risk management endeavors to manage the Group’s risk as a whole and not just individual risk factors.

Responsibilities

The principles of Luotea’s risk management are approved by the company’s Board of Directors. The Board monitors the implementation of risk management and assesses the efficiency of the methods employed. The President and CEO is responsible for the organization and implementation of risk management.

Risk management at Luotea Group is controlled by the risk management policy confirmed by Luotea’s Board of Directors. The policy specifies the objectives and principles, organization and responsibilities and procedures of the Group’s risk management.

The Group’s financing policy confirmed by Luotea’s Board of Directors is followed in the management of financial risks. The principles for insurance risk management are specified in the Insurance Policy.

Identification, assessment and reporting of risks

Risks are surveyed regularly and systematically at both division and company level and in central functions considered to be critical. The significance of risks is assessed by a risk matrix. Measures for managing and minimizing the identified risks are prepared and responsibility for these measures is allocated to specified individuals or units.

The most significant risks identified and the preparations for them are regularly reported to the President and CEO and the Board of Directors.