Sustainability Report

Principal Risks and Uncertainties

Principal risks and uncertainties for Royal Selangor

Principal risks are those with the greatest potential impact on the company should they materialise. Royal Selangor has identified and listed 10 principal risks that could affect our operations, extending beyond just environmental, social, and governance issues, as detailed in the table below. These risks are evaluated and rated based on the following factors:

Principal risk

Link to strategy

Gross risk

Residual risks

Likelihood Velocity

Trend

growth execution people

very high

moderate possible >20%

years

stable

Growth Ability to achieve growth

execution

moderate

low

possible >20%

years

new

Climate change Disruption & economic loss due to climate change

Link to Strategy

Each risk is assessed against three key strategies: growth, execution, and people.

growth execution people

high

moderate

possible >20%

years

stable

Technology Disruption due to competitor

Gross Risk

People Ability to attract & retain people

people

moderate

low

possible >20%

months

stable

High-impact risks with significant impacts on the company.

Residual Risk

execution

moderate

low

possible >20%

years

stable

Business continuity Disruption due to supply chain

The risks with a lower impact on the company.

growth

moderate

low

possible >20%

years

stable

Economy & geopolitics Impact of economy

Likelihood

& geopolitical environment

The probability of the risk occurring.

growth

high

moderate

possible >20%

months

stable

Commercial Loss of focus on customers & market

Velocity

Time factor on the impact of the risk to the company.

execution people

very high

high

possible >20%

weeks

stable

Product quality Failure of product causes harm to brand

Trend

execution

high

moderate

probably >40%

days

up

Cyber security Impact on company

The prominence of each risk is evaluated.

execution

moderate

low

unlikely <20%

months

stable

Legal & compliance Ethical breach or failure to meet contractual obligations

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