I i I tiï O Q, Risk Management A business integrated approach to managing our risks - HEINEKEN manages the main opportunities and risks arising from its strategy and its daily operations. Integrated approach Risk profile Risk appetite HEINEKEN business framework We are HEINEKEN Introductio^^^^^^^^^^H Report of the Executive Board^^^^^l Report of the Supervisory Board At HEINEKEN, risk management is an integral part of doing business and is supported by clear governance. Risks are an essential element when opportunities are assessed and strategies set. Management decisions are made in line with HEINEKEN's risk appetite. Risks are identified, mitigated and monitored on an ongoing basis, as part of business routines. HEINEKEN has established risk management as the system of managing the risks that the Company inevitably faces in achieving its strategy. Through managing our risks in a conscious manner, we increase the likelihood that our strategy and business objectives are achieved. Our proactive approach ensures risk management is part of our executive conversations and is embedded in our processes. It benefits our decision-making and is essential to create and preserve long-term value. HEINEKEN is predominantly a single-product business, operating throughout the world in the alcohol industry. HEINEKEN is present in more than 70 countries, with a growing share of its revenues originating from emerging markets. An increasingly negative perception in society towards alcohol could prompt legislators to implement further restrictive measures such as limitations on availability, advertising, sponsorships, distribution and points of sale, and increased tax. This may cause changes in consumption trends, which could lead to a decrease in the brand equity and sales of HEINEKEN's products. HEINEKEN has undertaken business activities with other market parties in the form of joint ventures and strategic partnerships. Where HEINEKEN does not have effective control, decisions taken by these entities may not be fully harmonised with HEINEKEN's strategic objectives. Moreover, HEINEKEN may not be able to identify and manage risks to the same extent as in the rest of the Group. HEINEKEN's risk appetite is the result of its wide geographical spread, prudent financial management and commitment to long-term value creation. Risks are taken consciously, assessing their impact on HEINEKEN's objectives. The level of risk HEINEKEN is willing to take depends on the type of objective it impacts. Reputational HEINEKEN invests in building and protecting the value of the Company. We aim to reduce the risks that could impact our reputation to the furthest extent possible, accepting that this may come at a cost. Financial HEINEKEN is keen on pursuing commercial opportunities to deliver top line growth, accepting uncertainties linked to its strategic choices and the context of the individual markets in which it operates. Business continuity HEINEKEN makes the availability of its brands a priority, accepting only minimal disruptions to its operations. In addition, HEINEKEN is continuously investing to make the organisation future-proof and ensure the sustainability of the business. Heineken N.V. Annual Report 2018 Financial Statements Sustainability Review Other Information The HEINEKEN business framework articulates the key elements that the Company relies on to operate effectively and deliver long-term value creation while protecting the Company's people, assets and reputation. HEINEKEN's vision, purpose and values, 'We are HEINEKEN', underpin the Company's strategic objectives, enabled by our organisational structure and Governance. Behaviours provide clear guidance to all employees on how to act and foster a culture of achievement, collaboration and growth, underpinned by the Behaviours framework that reflects the expected attitudes in decision making. Risk Management is an ongoing activity supporting achievement of our business objectives, based on our Risk Assessment Cycle, the HEINEKEN Code of Business Conduct and the HEINEKEN Rules. As part of the Risk Assessment Cycle, operating companies and their Management Teams review and update their risks on a continuous basis throughout the year. The HEINEKEN Rules articulate how we work and the standards to which we commit. They are a key element for managing the risks faced by our Company and translate our objectives into clear instructions on how to conduct our daily business. Our Code of Business Conduct and its underlying policies set out HEINEKEN's commitment to conducting business with fairness, integrity and respect for the law and our values. HEINEKEN's systems of risk management and internal control, which are based on the COSO Enterprise Risk Management and Internal Control Reference model, form a fundamental part of the HEINEKEN Business Framework. Behaviours Strategy Governance How we act Our global priorities How we govern internally NK NK Code of Business HEINEKEN Rules Risk Management Conduct How we work How we manage risks How we behave Laws and Regulations Monitoring and Assurance Policies Standards and Procedures Processes Systems Execution and change management

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 2018 | | pagina 27