Reebok 2006 Annual Report Download - page 100

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Group Management Report ›
096 ANNUAL REPORT 2006 › adidas Group ›
Risk Report
The adidas Group constantly explores and develops
opportunities to maximize earnings and to increase long-
term shareholder value. In doing so, we acknowledge that
it is necessary to take certain risks to optimally explore
business opportunities in a well-controlled and managed
risk environment. Our risk management principles provide
the framework for our Group-wide risk management.
Strategic and Operational Risk Management
Principles and Process
Within the adidas Group, centralized risk management pro-
vides relevant tools and know-how to assist line managers
in central and brand function roles with the risk manage-
ment process. Further, the central risk function aggregates
the identified risks on a Group-wide basis and monitors their
development over time. Our Management continually inte-
grates this risk information into its decision-making pro-
cesses. We are convinced that risks are best identified and
assessed where they arise, reflecting that different business
segments and regions carry heterogeneous risk profiles.
Our risk management process is composed of the following
steps:
» Risk identification: The adidas Group constantly monitors
both the macroeconomic environment and developments in
the sporting goods industry as well as internal processes to
identify risks as early as possible. As a result, we have defined
a catalog of potential risks for our Group in each of these
areas that assists management at different levels within our
organization in identifying risks.
› Risk Report
Supervisory and Executive Boards
Brand and Headquarter Functions
Central Risk Management
Risk reporting Risk treatment & controlling
Risk assessment
Risk aggregation
Risk identification
adidas Group Risk Management System