Unilever 2013 Annual Report Download - page 40

DESCRIPTION OF RISK WHAT WE ARE DOING TO MANAGE THE RISK
TALENT
A skilled workforce is essential for the continued success
of our business.
Our ablty to attract, develop and retan the rght number of
approprately qualfed people s crtcal f we are to compete
and grow effectvely
Ths s especally true n our key emergng markets where there can
be a hgh level of competton for a lmted talent pool The loss of
management or other key personnel or the nablty to dentfy,
attract and retan qualfed personnel could make t dffcult to
manage the busness and could adversely affect operatons and
fnancal results
Resource commttees have been establshed and mplemented
throughout our busness These commttees have responsblty for
dentfyng future sklls and capablty needs, developng career
paths and dentfyng the key talent and leaders of the future
We have an ntegrated management development process whch
ncludes regular performance revews underpnned by a common
set of leadershp behavours, sklls and competences
We have targeted programmes to attract and retan top talent
and we actvely montor our performance n retanng talent
wthn Unlever
SUPPLY CHAIN
Our business depends on purchasing materials, efficient
manufacturing and the timely distribution of products
to our customers.
Our supply chan network s exposed topotentally adverse
events such as physcal dsruptons, envronmental and ndustral
accdents or bankruptcy of a key suppler whch could mpact
our ablty to delver orders to our customers
The cost of our products can be sgnfcantly affected by the cost
of the underlyng commodtes and materals from whch they
are made Fluctuatons n these costs cannot always be passed
on to the consumer through prcng
We have contngency plans desgned to enable us to secure
alternatve key materal supples at short notce, to transfer or share
producton between manufacturng stes and to use substtute
materals n our product formulatons and recpes
These contngency plans also extend to an ablty to ntervene
drectly to support a key suppler should t for any reason fnd tself
n dffculty or be at rsk of negatvely affectng a Unlever product
We have polces and procedures desgned to ensure the health and
safety ofour employees and the products n our facltes, and to
deal wthmajor incidents or crises including business continuity
and disaster recovery.
Commodity price risk is actively managed through forward-buying
oftraded commodities and other hedging mechanisms. Trends are
monitored and modelled regularly and integrated into our
forecasting process.
SAFE AND HIGH QUALITY PRODUCTS
The quality and safety of our products are of paramount
importance for our brands and our reputation.
The risk that raw materials are accidentally or maliciously
contaminated throughout the supply chain or that other product
defects occur due to human error, equipment failure or other
factors cannot be excluded.
Our product quality processes and controls are comprehensive
from product design to customer shelf. They are verified annually,
and regularly monitored through performance indicators that drive
continuous improvement activities. Our key suppliers are externally
certified and the quality of material received is regularly monitored
to ensure that it meets the rigorous quality standards that our
products demand.
In the event of an incident relating to the safety of our consumers
or the quality of our products, incident management teams are
activated in the affected markets under the direction of our product
quality, science, and communications experts, to ensure timely and
effective market place action.
SYSTEMS AND INFORMATION
Unilever’s operations are increasingly dependent on IT systems
and the management of information.
We interact electronically with customers, suppliers and consumers
in ways which place ever greater emphasis on the need for secure
and reliable IT systems and infrastructure and careful management
of the information that is in our possession.
Disruption of our IT systems could inhibit our business operations in
a number of ways, including disruption to sales, production and
cash flows, ultimately impacting our results.
There is also a threat from unauthorised access and misuse of
sensitive information. Unilever’s information systems could be
subject to unauthorised access or the mistaken disclosure of
information which disrupts Unilever’s business and/or leads to loss
of assets.
Hardware that runs and manages core operating data is fully
backed up with separate contingency systems to provide real time
back-up operations should they ever be required.
We maintain a global system for the control and reporting of access
to our critical IT systems. This is supported by an annual
programme of testing of access controls.
We have policies covering the protection of both business
and personal information, as well as the use of IT systems and
applications by our employees. Our employees are trained to
understand these requirements.
We have standardised ways of hosting information on our public
websites and have systems in place to monitor compliance with
appropriate privacy laws and regulations, and with our own policies.
37Unlever Annual Report and Accounts 2013 Strategc report