Universal Registration Document - Fiscal 2023

6.3.2 Emerging Risks

6.3. Risk factors

6.3.2 Emerging Risks
Interconnectivity of Principal Risk Factors

Sodexo’s risk factors may arise individually, but they can also have an effect on each other. In order to better understand the relationship between the risk factors, and to enhance overall risk resilience, a mapping of the interconnectivity of the risk factors was carried out. This mapping is shown below.

INTERCONNECTIVITY OF RISKS

This diagram shows the interconnectivity of principal risk factors.

The compliance with laws and regulations are interconnected with:

  • Technology and information security
  • Client contract execution

The climate disruption exposure is interconnected with:

  • Client contract execution
  • Changing consumer expectations and behaviors

Client retention is interconnected with:

  • Talent management and development
  • Client contract execution 
  • Competition 
  • Changing consumer expectations and behaviors

Changing consumer expectations and behaviors are interconnected with:

  • The environmental impact of Sodexo.
  • Competition
  • Technology and Information security
  • Client retention
  • Climate disruption exposure

Bidding risks are interconnected with:

  • Competition

Competition is interconnected with:

  • Bidding risks
  • Changing consumer expectations and behaviors
  • Client retention

Client contract execution is interconnected with :

  • Client retention
  • Compliance with laws and regulations
  • Food, services safety and workplace safety
  • Staff shortages and resource planning
  • Climate disruption exposure
  • Talent management and development

Technology and Information security is interconnected with:

  • Changing consumer expectations and behaviors
  • Compliance with laws and regulation

Talent management and development is interconnected with:

  • Client retention
  • Client contract execution
  • Food, services and workplace safety

Staff shortages and resource planning is interconnected with :

  • Client contract execution

Food, services and workplace safety is interconnected with :

  • Talent management and development 
  • Client contract execution

The environmental impact of Sodexo is interconnected with:

  • Changing consumer expectations and behaviors

6.3.2 Emerging Risks

In carrying out its risk assessment, Sodexo also considers risks arising from changes in the external environment. This includes consideration of emerging risks that are new external risks or existing external risks that have evolved with time, or have been triggered by changed circumstances. They may be perceived to be potentially significant, but might not yet be fully understood, and/or the consequences may be difficult to quantify.

In Fiscal 2023, in order to identify emerging risks at the earliest opportunity, a horizon scanning exercise was carried out, collating risk themes and trends from industry and professional bodies and peer networks. These themes and trends were then discussed and explored by a mixed team of operational directors and risk specialists to consider their potential impact on Sodexo, and the time horizon of the risk (medium/long-term). A first emerging risks mapping (”emerging risks radar”) was established, which will be refined over the next fiscal year.