ST Engineering Annual Report 2020

CORPORATE OVERVI EW PERFORMANCE REVI EW SUSTAINABI L ITY CORPORATE GOVERNANCE F INANCIAL REPORT The annual risk work plan is approved by the RSC. There is at least a member on the RSC who is also a member of the AC to facilitate communication and access of information between the two Board Committees. During the year, the Group engaged an external consultant to review its ERM Framework, and had completed enhancements to the framework accordingly. c) Risk Aware Culture and Training Embedding the right culture throughout the organisation is important for effective risk management. The RSC recognises good culture fosters openness that will enable management and staff to escalate concerns in a timely manner without fear, as well as promote better judgment, which provides greater comfort to the Board and management. As part of the risk awareness and communication programme, annual risk management training plans covering covering ST Engineering Code of Business Conduct and Ethics, and key risk topics are rolled out at the Group level. The status of training is updated to the RSC at periodic intervals. d) Risk Review Process Under the ERM framework, a risk dashboard of the top business risks to streamline is developed and maintained by each of the significant business units, rolling up into a summary dashboard for respective businesses. Once the top business risks are identified, measures will then be taken to develop and implement risk preventive and mitigation actions (collectively known as “controls”) and risk monitoring processes. The business managers are required to periodically review the effectiveness of the controls implemented, and initiate the necessary changes as the risk profile changes. ENTERPRISE RISK MANAGEMENT SYSTEM BUILDING A STRONG ERM CULTURE ERM PROCESS ERM REPORTS ERM INFRASTRUCTURE Vision and Goals Oversight Structure Roles and Responsibilities Common Language Policies and Manuals Tolerance and Limits Technology and Tools Change Management Continuous Improvement Communication Information Sharing Awareness/ Training Risk and Incident Registers Financial and Risk Reports R i s k R e p o r t i n g B u s i n e s s A n a l y s i s R i s k I d e n t i i c a t i o n R i s k S t r a t e g i e s R i s k A s s e s s m e n t a n d P r i o r i t i s a t i o n Business Goals, Objectives & Strategies Quarterly, President/Head of Aerospace, Electronics, Land Systems and Marine, as well as their respective CROs review respective dashboard of top business risks with the RSC. At the meetings, these Presidents/Heads and CROs will discuss the risk management action plans and measures to address these risks. At the same time, they will also highlight the following for discussion: • emerging trends and issues in each business sector; • new risks or changes to existing risk profile; • new risk incidents; • major risk exposures; and • risk management actions taken on previously identified risks. STRENGTHENING ERM CAPABILITIES 11 9 ANNUAL REPORT 2 02 0 /