Risk management process
To prevent risks or mitigate their effects and loss, Axfood works with an established Enterprise Risk Management process, where risks are continuously identified, managed and reported within the Group. In this work, operational, strategic and financial risks are assessed from probability and consequence perspectives. Operational and strategic risks include sustainability risks.
Risk management process
Risks are assessed and documented by the respective risk owners at least twice a year as well as on a continuing basis where necessary. Assessment is made of the changed level of existing risks as well as of potential risks. Strategic risks, such as increased competition, sector convergence, changes in the assortment and other changes in the external business environment that can affect Axfood’s strategic objectives, are managed in the Board’s and management’s continuing work.
Risks are classified according to how well countermeasures are implemented, and are colour-coded into red, yellow and green categories. The risk owners are the members of the Executive Committee, who are responsible for the risk maps in their respective areas. Axfood has a risk committee, which is headed by the Group’s Risk Manager. The risk committee is tasked with, among other things, following up planned countermeasures and consolidating the risks identified by the respective risk owners. A compilation is made at the Group level, which coincides with respect to time with the Group’s business plan and thereby facilitates budgeting for decided countermeasures. For a description of the organization, governance and reporting of Axfood’s risk management, see the illustration below.
Incident reporting systems are in place in all parts of the Group. Through these a compilation is made that gives Axfood documentation for determining how operational risks are to be prioritized and managed effectively and systematically.
Axfood has Group-wide insurances that are reviewed yearly by an independent, external party. The insurances cover, among other things, property, business interruption, product liability, cyber security, transports, and directors and officers liability. Axfood renewed all of its insurances prior to 2020.
Crisis management and business continuity plans
The Axfood Group has crisis management plans in place for which drills are conducted on a regular basis by all of the companies’ crisis management teams. These plans and drills are designed to ensure preparedness for a crisis and that the right actions are taken at the right time by the designated key functions. The aim is to minimize acute loss in a situation in which normal routines are insufficient. For events in which a crisis is drawn-out, Axfood works preventively and actively with continuity plans to minimize the duration of any business interruption.