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region, in line with the Group’s geographic expansion strategy. Further risks include
fluctuation in foreign currency, exchange rates against the Saudi riyal, or other currencies
of the countries that the Group operates in, and inflation in the economies of countries
where the Group operates; risks related to entering into new investments; and risks that
might be associated with the current economic conditions and political situation in
countries where the Group operates or exports its products.
The Group faces other risks
from its various investment shareholdings in different companies and funds, locally and
internationally
As part of the Company's policy in managing these risks, is to establish effective
mechanisms and procedures to closely monitor the risks which the Company is exposed
to through its Board, the Company Committees, the Executive Management, the relevant
team members in the subsidiaries, the Risk Management Unit (if any) and the Risk
Management Committee (if any). Also the subsidiaries have policies, plans, procedures
and measures in this regard. The company continuously develops and updates its existing
risk management systems. The Group also discloses annually the overall perception of
potential risks through the annual directors’ report.
The most important types of risk faced and managed by the Group through the
mechanisms mentioned in this policy are credit risk, currency risk and fair value cash flow
interest rate risks, Liquidity risk, and price risk as well as risks of human resources,
compliance with laws and regulations, investments and others.
Within the framework of risk management mechanisms and procedures, the company
develops an integrated (Enterprise Risk Management “ERM”) program for itself and
operating companies and it will be activated by a GRC system developed by the company
with the assistance of a specialized consultant in this field under the supervision of the
Executive Management. The objective of this system is to effectively enhance the
participation of the Board and the Executive Management Team in the risk management
process to ensure a unified vision of the risks faced by the Group.
c-2) Risk Management Department
The Risk Management Department reports to the CEO, the Managing Director (if any) or
any other executive, submit its performance reports thereto and report to the Risk
Committee (if any). It is a completely independent Function of Internal Audit Function.
The Executive Management shall provide regular report on risk management activities to
the Board in the light of their risk management competencies set out in this Manual. Also,
the Risk Management Department shall:
a.
Develop an effective strategy, plans, policies, procedures and measures for Savola
Group’s and OpCos’ risk management and systems to assess risks to identify and
address deficiencies;
b.
Implement risk management plans and strategy;
c.
Monitor the risks to which the Savola Group and its OpCos may be exposed, and the
extent to which they are exposed to such risks and conduct ongoing assessments in
this regard;
d.
Develop a plan for crises and emergencies;
