Governance &
SustainabilityRisk Management
The board accepts final responsibility for the internal control and risk management systems of the Group.
All material risks in the Group have been identified and documented in a comprehensive risk framework per division. Proper internal control systems are in place and are maintained through a divisionally controlled system. The timely execution of self-control procedures is controlled programmatically and compliance with self-control procedures is monitored internally.
Group assets are comprehensively insured by Sasguard Insurance Company Limited, a subsidiary with a limited insurance licence, approved by the Financial Services Board, and is regulated as such. It is therefore in essence a process of self-insurance, supported by external reinsurance cover for abnormal disasters and other material risks.
The daily treasury activities of the Group are limited to the raising of call and short-term loans, as well as short-term investments. Adequate borrowing facilities exist to ensure daily liquidity, while surplus funds may be invested only at institutions approved by the board. Foreign currency trading is regulated by an approved policy to ensure optimal effectiveness between the buying and selling of currency.
Foreign currency trading is regulated by an approved policy to ensure optimal effectiveness between the buying and selling of currency.
Raw material purchases and the use of derivative financial instruments for the hedging of raw material costs are regulated by a comprehensive policy document approved by the board. Speculation with any financial instrument is specifically prohibited. Application of this policy is closely monitored by an executive committee under chairmanship of the managing director. Reports on the above procedures provide the board with reasonable assurance concerning the reporting of reliable financial information, as well as securing the Group’s assets.
Internal audit
An independent internal audit function exists, with the head of internal audit reporting directly to the managing director with ready and regular access to the chairman of the audit and risk committee.
The department consists of eight people with relevant training and experience. The objectives, authority and responsibility of the independent internal audit function are fully described in an internal audit charter approved by the audit and risk committee. The internal audit department liaises closely with the external auditors to prevent duplication. Findings and recommendations of all internal audit processes are reported to management and the audit and risk committee.
The internal audit of specialised information technology and the SAP ERP system environment has been outsourced to a division of PricewaterhouseCoopers Inc. This division functions independently from the external audit function.
