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19 June 2020

Risk Management

SCG Enterprise Risk Management Framework has implemented the Enterprise Risk Management Framework in alignment with international standards. The framework consists of 4 aspects.

  1. Strategy Establishment
    SCG has established explicit objectives and risk appetite in managing risks to ensure consistent risk management practice across the organization.
  2. SCG Risk Management Structure and Responsibilities
    The organizational structure of SCG’s risk management is illustrated below.
  3. Risk Management Process
    SCG risk management framework applies to three areas: strategic risk, investment risk, and operational risk. The risk management process comprises risks or opportunities identification, risk assessment, risk response, and risk reporting.
  4. Building a Corporate Risk Culture
    SCG recognizes that risk culture is a critical component of risk management. SCG begins from tone at the top by having executive management to be a role model for a strong risk culture and to communicate its importance. Risk management is embedded in decision-making process, and related trainings and seminars are also provided to management and employees throughout the organization.

Enterprise Risk Management Organizational Structure

Key Risks

Below are the key challenges for SCG businesses.

  • Safety and Health Risks
  • Climate Change and Environmental Risks
  • Compliance Risks from Changes in Laws & Regulations
  • Reputation Risks from Eco-consciousness Trend
  • Geopolitical Risks
  • Drought
  • Fluctuation in Energy and Major Raw Material Prices Risk
  • Human Resources Management and Capability Risks
  • Foreign Exchange Rates Fluctuation Risks
  • Risks from Global Economic Slowdown
  • Details of scenarios, risk assessment, impact, and risk mitigation strategies are disclosed on 2019 Annual Report.

Emerging Risks

  • Risks from Digital Technology Transformation
  • Risks from Consumers’ Behavior Change due to Circular Economy Trend
  • Risks from Changing Business Landscapes