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At Implats, our approach to risk is based on contextualising,
identifying and managing risk within a broader understanding
of our objectives and by following a standard process of objective-based risk assessment to identify and evaluate
risks across the Group.
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- Establishing the context includes determining key
objectives, key stakeholders and their interests, and
considering all external and internal factors (from cultural
and perceptual to regulatory and global)
- Identifying the risk entails establishing both source and
cause, and evaluating all possible consequences
- Analysing risk – what does this mean for our objectives?
- Risk evaluation encompasses determining the risk
rating (by severity, exposure and frequency) using
standard Implats tables, identifying controls (existing or
new) and prioritising risks
- Treating risk requires considering all options to establish
the most appropriate response for every risk identified
(avoid, change probability of exposure and/or frequency,
transfer, retain)
Ongoing review ensures the risk plan remains relevant.
Factors that may affect consequences and the likelihood of
an outcome, and the factors that affect the suitability or
cost of treatment options may change. Implats therefore
repeats the risk management cycle regularly. All information
is captured into a group risk repository system, feeding
into the Group risk profile. Risk reports are presented to
the appropriate bodies and escalated as required, culminating with the Board Audit and Risk Committee and
the Board.
The Board has ultimate responsibility for establishing a
framework for internal controls, including appropriate risk
management and good corporate governance frameworks
and systems.
Implats has established key controls that focus on critical
risk areas identified by line management, facilitated by risk
management, assessed and evaluated by the internal
audit function. Every critical risk and control, as well as any
associated tasks, have a designated line management
'owner'. The controls are designed to provide a costeffective
assurance that Implats' assets are safeguarded
and that liabilities and working capital are efficiently
managed. Established organisational policies, procedures,
standards, guidelines, structures and delegation
frameworks provide appropriate levels of direction,
accountability and segregation of responsibility, which
facilitate self-checking and monitoring mechanisms.
Internal audit, in partnership with senior management,
monitors these controls and risk management processes
(page 139).
Strategic risks FY2010
The strategic risk issues currently facing the Group and which inform Implats' business planning, risk management and
resource allocation priorities are noted below:
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Objective |
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Safety, health and environment |
Continual improvement in safety, health and environmental performance |
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Production |
Maintaining reliable and effective production processes and delivering product on time and to specification |
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Project delivery |
Maintaining effective project management processes and improving skills to ensure successful project implementation and delivery |
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Minerals resource management |
Continually identify, delineate, measure and optimise our mineral resources and reserves |
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Unit costs |
Sustaining unit production costs in the lowest quartile of the industry |
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Supply and demand |
Understanding future demand for our products, and the corresponding industry supply-side profile |
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Rand/dollar exchange rate |
Closely monitoring the effect of the rand/dollar exchange rate as a source of significant volatility for our business |
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Effective people |
Attracting, developing, retaining and motivating the requisite management, operational, technical and business skills and pool of talent
Achieving organisational diversity and improved employee engagement and participation in all business activities |
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Growth |
Retaining a focused and sustainable growth portfolio of assets to ensure Implats remains in the top quartile of performers in its areas of core competence |
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Cash preservation |
Focus on cash management as a key to preserving the financial value of the business
Scanning the environment for technological advances that may affect demand for Implats’ products (substitution), and instituting appropriate responses where possible |
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Country risk |
Zimbabwe
Managing the uncertainties that affect the Zimbabwe operations
Social
Addressing relevant issues on sustainability, corporate responsibility, and being recognised as a good corporate citizen in the countries and communities where we operate; maintaining sound and mutually beneficial relationships with these and the general public
Retaining permission to operate, and full legal and regulatory compliance in a continually changing environment |
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Infrastructure |
Continually monitoring the condition and future availability of infrastructure (power, water, roads) in both South Africa and Zimbabwe |
Details of Implats-specific risk factors are available on the corporate website (www.implats.co.za). |
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