CORPORATE GOVERNANCE REPORT ENTERPRISE RISK MANAGEMENT FRAMEWORK Vision and Goals Oversight Structure Roles and Responsibilities Common Language Policies and Manuals Tolerances and Limits Technology and Tools Risk and Incident Registers Risk Reports ERM INFRASTRUCTURE ERM PROCESS ERM REPORTS Risk Strategies Risk Assessment and Prioritisation Risk Reporting Business Analysis Risk Identification Business Goals, Objectives and Strategies STRENGTHENING ERM CAPABILITIES BUILDING A STRONG ERM CULTURE Change Management Continuous Improvement Communication / Information Sharing Awareness / Training Enterprise Risk Management (ERM) Framework The Group has put in place an ERM framework to identify, assess, monitor, and manage key business risks in the short, medium, and long term. The ERM framework sets out a common and consistent understanding of risks and risk tolerance limits across the Group, allowing the Board and Management to cascade down the Company’s risk management philosophy and overall risk appetite as they establish business strategies and objectives. As part of providing leadership in the implementation of the Groupwide Enterprise Risk Management (ERM) framework, Group R&A maintains an ERM Manual which provides guidelines on risk identification, assessment, and reporting procedures. To facilitate knowledge sharing across various Business Areas and continuous improvement of key ERM processes, material risk events and corresponding controls are also captured and updated in a centralised risk repository. This repository supports analysis, risk monitoring and response, and facilitates risk assessments and dashboard reporting. a) Risk Appetite Framework The Risk Appetite Framework defines the risk boundaries in line with our corporate strategy for compliance within the Group. Under this framework, the Board has approved six Group Risk Appetite Statements with respect to our key risks, and in line with the Group’s material ESG factors. They serve as a key conduit for aligning the Group’s risk profile with the Group’s corporate strategy to achieve its business objectives. Enterprise-wide risk appetite statements are approved by the Board of Directors based on 98 ST ENGINEERING ANNUAL REPORT 2022
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