RISK MANAGEMENT PHILOSOPHY
The Company believes that risk management is an integral part of its business strategy and good corporate governance.
Risk Management, therefore seeks to avoid, eliminate or reduce losses that can impair the operational capability and financial stability of the company, and transferring or financing those losses by insurance, self-insurance and other means.
| Risk Exposure | Risk Management Policy | Objective |
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Operational Supply Chain risk Risks that may occur when purchasing its raw materials as the Company’s products are dependent on the raw materials availability and prices. Major disruption of its supplies could impact on its production and its ability to supply the products to the customers. Foreign exchange fluctuations also have effect on the production cost. |
It is the policy of the company to determine the optimal minimum and maximum inventory level of law materials. Inventory levels should be reviewed and adjusted, as necessary. Alternative supplier program is also implemented.
When planning the purchase, the quantity should be that which results in the lowest total cost to the Company, including the cost of carrying the raw material in stock as well as its procurement costs. |
To ensure adequate supply of raw materials to support production requirements. To optimize operational efficiency. |
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Financial Credit risk Risk that the company will incur a loss because its customers, clients or counterparties failed to discharge their contractual obligations. Liquidity risk Risk that the company will be unable to meet its payment obligations when they fall due under normal and stress circumstances. |
It is the policy of the Company that all customers that wish to trade on credit terms are subject to credit verification procedures.
It is the policy of the Company to use diversified funding sources. |
To strengthens management of funds and assets.
To improve cash flow to generate
more investible funds.
To meet commitment to clients,
and to judiciously settle all valid
claims.
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Hazard/Compliance Properties Risk
Fire
Explosion
Machinery breakdown
Natural Events Risk
Flooding
Typhoon
Earthquake
Environmental Risk
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The Company maintains systematic and total approach to the management of these risks which include risk control or loss prevention and risk finance or risk transfer.
The Company ensures compliance with environmental laws and Regulations.
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To minimize losses or prevent
damage to finished products and
properties.
To ensure business continuity and protect company image.
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