6.4 Risk management
6.4.3 Risk factors6.4.3 Risk factors
6.4.3.1 Principal Risks and Risk Management Measures Summary of Sodexo’s Principal Risk Factors
The summary table of Sodexo’s principal risks shows a classification of the risks by reference to four categories, as well as risks from the external environment. As outlined in 6.4.2.4, each risk is assessed using impact and probability to give an evaluation of the inherent risk, and then a third criteria “level of control” is used to evaluate the overall net risk. The table below shows the net risk assessment. The most significant risks are presented at the top of each category, and the materiality of each risk shown is using a two-level rating scale, as follows:
MAIN RISKS AND RISK MANAGEMENT
CLIENTS/CONSUMERS
- Client retention: HIGH LEVEL
- Changing consumer expectations and behaviors: MEDIUM LEVEL
- Bidding risks: MEDIUM LEVEL
- Competition: MEDIUM LEVEL
OPERATIONS
- Client contract execution, including inflation management: HIGH LEVEL
- Technology and information security: MEDIUM LEVEL
PEOPLE
- Talent management and development: HIGH LEVEL
- Staff shortages and resource planning: HIGH LEVEL
CORPORATE RESPONSIBILITY
- Food, services and workplace safety: MEDIUM LEVEL
- Environmental impact: MEDIUM LEVEL
EXTERNAL ENVIRONMENT
- Compliance with laws and regulations: MEDIUM LEVEL
- Pandemic risks: MEDIUM LEVEL