Risk management

Tikkurila endeavors to identify, analyze, evaluate and treat risks systematically and proactively. Tikkurila’s objective is to reach the desired aggregate risk level and ensure the continuity of operations.

Key Risk Management Principles

Tikkurila aims at systematic and proactive identification, analysis, evaluation and treatment of various risk categories, such as strategic, operational, accident and financial risks. Tikkurila’s objective is to determine and maintain the desired aggregate risk level in relation to the Group’s risk tolerance, while ensuring business continuity.

Tikkurila’s risk management is based on the Finnish Corporate Governance Code and on Tikkurila's Code of Conduct. In addition, Tikkurila has Group guidelines and policies in place that specify management objectives, responsibilities and risk limits in greater detail.

Tikkurila’s Board of Directors defines the main principles of Tikkurila’s risk management and approves the Group’s risk management policy, and the Audit Committee assists the Board in risk management supervision. The business units and functions are responsible for the risks involved in their activities and for the related risk management.

Risk Management Implementation

In Tikkurila, each business unit and function performs its overall risk management in conformity with the jointly agreed risk self-assessment methodology. The results of the risk management process are reported regularly, both internally and as part of Tikkurila’s external reporting.

Some risk management measures are performed centrally in order to generate cost benefits and ensure a sufficient level of protection. These include insurance cover for certain risks, such as general third party and product liability, cargo, property damage and business interruption insurance for major production sites, as well as the hedging of treasury risks.

 

More information on Tikkurila's risk management and risks can be found on Tikkurila's Corporate Governance Statement for 2011.