Experian 2013 Annual Report Download - page 32
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Please find page 32 of the 2013 Experian annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.INTERRUPTIONS IN BUSINESS PROCESSES OR SYSTEMS
Performance indicator
EBIT and total revenue
growth
Strategic alignment
• Product innovation
Description of risk and potential impact
Our ability to provide reliable services largely depends on the efficient
and uninterrupted operation of our computer network systems, data and
call centres, as well as maintaining sufficient staffing levels. Our systems,
personnel and operations could be exposed to damage, interruption and
pandemic outbreaks if we do not have sufficient redundant operations to
cover a loss of personnel or failure of our systems in a timely manner. Any
significant failure or interruption could have a material adverse effect on our
business, results of operations and financial condition.
How we manage this risk
We have strict standards, procedures and training programmes for
physical security along with comprehensive business continuity plans and
incident management programmes. We maintain full duplication of all
information contained in databases and run back-up data centres. Support
arrangements, strict standards, procedures and training schemes for
business continuity have been established with third party vendors. We also
monitor potential pandemic threats and adjust action plans.
Change from 2012
Stable
2013 update
Continuity of services is a core focus
and built into the development of
new and existing products. While
we experienced limited disruptions
during the fiscal year, events such
as the London 2012 Olympics and
Hurricane Sandy along the US
eastern seaboard provided real-time
validation of established plans and
processes. We continue to execute
periodic exercises to ensure that
documented procedures are accurate
and suitable for each specific
environment.
DEPENDENCE ON RECRUITMENT AND RETENTION OF HIGHLY SKILLED PERSONNEL
Performance indicator
Employee engagement
Strategic alignment
• New customer segments
• Expanding geographically
• Product innovation
Further information
• Our people section
• Corporate responsibility
section – be a good
employer to all
Description of risk and potential impact
Our ability to meet the demands of the market and compete effectively with
other information technology suppliers is, to a large extent, dependent on
the skills, experience and performance of our personnel. Demand is high for
individuals with appropriate knowledge and experience in the information
technology and business services market. We may not be able to hire and
retain such personnel at compensation levels consistent with its compensation
structure. Some of our competitors may be able to offer more attractive terms
of employment and they may seek to hire our existing personnel. The inability
to attract, motivate or retain key talent could have a material adverse effect on
our ability to service client commitments and grow their business.
How we manage this risk
Effective recruitment programmes are on-going across all business areas, as well as
personal and career development initiatives. Talent identification and development
programmes have been implemented and are reviewed annually. Compensation
and benefits programmes are competitive and also regularly reviewed.
Change from 2012
Stable
2013 update
The results of our 2012 global pulse
survey show consistent overall
improvement in the degree of
employee engagement, as well as
general satisfaction and involvement
at work. Separately, approximately
52% of our senior leadership roles have
successors ready to cover these roles
in the short and medium-term. We
have also continued to make several
strategic senior level external hires to
strengthen our senior leader capability.
OTHER RISKS
EXPOSURE TO MATERIAL ADVERSE LITIGATION INCLUDING CLAIMS OF INTELLECTUAL PROPERTY
INFRINGEMENT OR VIOLATION OF PRIVACY LAWS
Performance indicator
EBIT and general litigation
trends
Strategic alignment
• New customer segments
• Expanding geographically
• Product innovation
Further information
• Corporate governance
section associated with
the identification and
monitoring of litigation
• Financial statements note
50 describing contingencies
for pending and threatened
litigation claims
Description of risk and potential impact
We are regularly involved in a number of pending and threatened litigation
claims in the US and Latin America, including a number of class actions in
the US. Such litigation can comprise a number of areas, including intellectual
property, privacy, antitrust, general commercial disputes and employment.
The outcome of such claims is difficult to accurately assess or quantify. An
adverse outcome in any of these claims could result in civil or criminal
penalties as well as in negative publicity.
How we manage this risk
We monitor third-party patents and patent applications that may be
relevant to our technologies and products and carry out freedom to operate
analyses where we deem appropriate. We vigorously defend all pending and
threatened litigation claims. We employ internal counsel and engage external
counsel to assist in the effective management and disposal of litigation
proceedings. Insurance coverage is maintained against litigation risks where
such coverage is feasible and appropriate.
Change from 2012
Stable
2013 update
The exposure to material adverse
litigation in the US remains generally
consistent with prior years.
EXPOSURE TO COUNTRY AND REGIONAL (POLITICAL, FINANCIAL, ECONOMIC, SOCIAL) RISKS
PARTICULARLY IN THE US, LATIN AMERICA AND THE UK
Performance indicator
EBIT and total revenue
growth
Strategic alignment
• Expanding geographically
Further information
• Corporate responsibility
section – playing an active
part in communities
• Exposure to legislation or
regulatory reforms risks
and uncertainties
Description of risk and potential impact
Our global footprint subjects our businesses to economic, political and other
risks associated with international sales and operations. A variety of factors,
including changes in a specific country’s or region’s political, economic, or
regulatory requirements, as well as the potential for social and geopolitical
turmoil, including terrorism and war, could result in loss of services, prevent
our ability to respond to agreed service levels or fulfil other obligations. These
risks are generally outside our control.
How we manage this risk
Our portfolio is diversified by geography, by product, by sector and by client
in order to protect itself against many of these fluctuations, especially those
that are restricted to individual territories and market sectors.
Change from 2012
Stable
2013 update
We have operations in 40 countries
and provide services in many
countries around the world. For
2013, businesses in North America
accounted for 48% of global revenue,
in Latin America 21% and the UK
and Ireland 19%. Only 5% of global
revenue is derived from the euro zone.
30 Experian Annual Report 2013 Business overview