Reebok 2015 Annual Report Download - page 161

GROUP MANAGEMENT REPORT – FINANCIAL REVIEW
Risk and Opportunity Report
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Our risk and opportunity management process contains the following components:
•Risk and opportunity identification: The adidas Group continuously monitors the macroeconomic
environment and developments in the sporting goods industry, as well as internal processes, to identify
risks and opportunities as early as possible. Our Group-wide network of Risk Owners (i.e. all direct reports
to the adidas AG Executive Board, including the Managing Directors of all our markets) ensures effective
identification of risks and opportunities. The Group Risk Management department has defined a catalogue
of potential risk areas (Risk Universe) to assist Risk Owners in identifying and categorising risks and
opportunities.
The Risk Owners use various instruments in the risk and opportunity identification process, such as primary
qualitative and quantitative research including trend scouting and consumer surveys as well as feedback
from our business partners and controlled space network. These efforts are supported by global market
research and competitor analysis. Through this process, we seek to identify the markets, categories,
consumer target groups and product styles which show most potential for future growth at a local and global
level. Equally, our analysis focuses on those areas that are at risk of saturation or exposed to increased
competition or changing consumer tastes. However, our risk and opportunity identification process is not
only limited to external risk factors or opportunities; it also includes an internal perspective that considers
processes, projects, human resources and compliance aspects.
•Risk and opportunity evaluation: We evaluate identified risks and opportunities individually according
to a systematic evaluation methodology, which allows adequate prioritisation as well as allocation of
resources. Risk and opportunity evaluation is also part of the Risk Owners’ responsibility. The Group Risk
Management department supports and guides the Risk Owners in the evaluation process.
According to our methodology, risks and opportunities are evaluated by looking at two dimensions: the
potential impact and the likelihood that this impact materialises. Based on this evaluation, we classify risks
and opportunities into five categories: marginal, minor, moderate, significant and major.
01ADIDAS GROUP RISK AND OPPORTUNITY MANAGEMENTSYSTEM
Supervisory and Executive Boards
Group Risk Management
Risk Management Policy & Methodology/Support
Monitoring &
Reporting
Identification
Evaluation
Handling
Risk Owners