Nokia 2015 Annual Report Download - page 73

71
Board review
NOKIA IN 2015
■Our business model relies on solutions for
distribution of services and software or
data storage, which entail inherent risks
relating to applicable regulatory regimes,
cybersecurity breaches and other
unauthorized access to network data
orother potential security risks that
mayadversely affect our business.
■Our Nokia Technologies business group
aims to generate net sales and profitability
through licensing of the Nokia brand, the
development and sales of products and
services in the areas of virtual reality, digital
media and digital health, as well as other
business ventures including technology
innovation and incubation, which may not
materialize as planned or at all.
■We are subject to various legislative
frameworks and jurisdictions that regulate
fraud as well as economic and trade
sanctions and policies, and as such,
theextent and outcome of possible
proceedings is difficult to estimate with any
certainty. Our subsidiary Alcatel Lucent has
been, and continues to be, involved in
investigations concerning alleged violations
of anti-corruption laws, and has been, and
could again be, subject to material fines,
penalties and other sanctions as a result
ofsuch investigations.
■We have operations in a number of
countries and, consequently, risk facing
complex tax issues and disputes and could
be obligated to pay additional taxes in
various jurisdictions.
■Our actual or anticipated performance,
among other factors, could reduce our
ability to utilize our deferred tax assets.
■We may be unable to retain, motivate,
develop and recruit appropriately
skilledemployees.
■We may face problems or disruptions
especially within our Mobile Networks
business groups’ manufacturing, service
creation, delivery, logistics or supply chain.
Additionally, adverse events may have a
profound impact on production sites or
theproduction sites of our suppliers,
whichare geographically concentrated.
■An unfavorable outcome of litigation,
arbitrations, agreement-related disputes
orproduct liability-related allegations with
our business could have a material adverse
effect on us.
■Our net sales, costs and results of
operations, as well as the US dollar value of
our dividends and market price of our ADSs,
are affected by exchange rate fluctuations.
■Inefficiencies, breaches, malfunctions
ordisruptions of information technology
systems could have a material adverse
effect on our business and results
ofoperations.
■We may not be able to optimize our capital
structure as planned and re-establish our
investment grade credit rating or otherwise
improve our credit ratings.
■The amount of dividend and equity return
distributed to shareholders for each
financial period is uncertain.
■We may be unable to achieve targeted
benefits from or successfully implement
planned transactions or transactions may
result in liabilities.
■We are involved in joint ventures and are
exposed to risks inherent to companies
under joint management.
■Performance failures of our partners,
aswell as failures to agree to partnering
arrangements with third parties could
adversely affect us.
■Our efforts aimed at managing and
improving financial or operational
performance, cost savings, competitiveness
and obtaining the targeted synergy benefits
associated with the acquisition of Alcatel
Lucent, may not lead to targeted results,
benefits or improvements.
■We may be adversely affected by
developments with respect to the customer
financing or extended payment terms that
we provide our customers.
■The carrying amount of our goodwill may
not be recoverable.
■Unexpected liabilities with respect to
pension plans, post-retirement health
plans, employee-related healthcare or
insurance matters.
■Unexpected liabilities or issues with
respectto the acquisition of Alcatel Lucent,
including pensions, employee funds,
post-retirement health plans, health and
life insurances, healthcare costs and other
employee liabilities or higher than expected
transaction costs.
■Alcatel Lucent’s business includes the
installation and maintenance of undersea
telecommunications cable networks,
andinthe course of this activity it may
cause damage to existing undersea
infrastructure, for which it may ultimately
be held responsible.
Nokia Board of Directors
April 1, 2016