TREASURY & FINANCIAL RISK Given the Group’s diversified global businesses, the Group is exposed to market concentration, liquidity, interest rate and foreign currency risks. We have established policies, guidelines and control procedures to manage and report exposure of such risks. Market Concentration We identify opportunities and improvements by: • Disciplined financial management to strengthen investor confidence. The risk of a significant loss due to the poor performance of a single exposure (or Group or related exposure). We manage this risk by: a) Monitoring and maintaining our geographical and asset concentration exposure in accordance with our risk appetite and tolerance. b) Active management to ensure that our portfolio of assets, investments and businesses are diversified against the systemic risks of operating in a specific geography. Liquidity The Group’s ability to meet short-term financial obligations. We manage this risk by: a) Monitoring and maintaining a healthy level of cash and cash equivalents and credit facilities. b) Having in place Medium-Term Note (MTN) programmes to provide a further avenue to support planned growth and investment opportunities. c) Maintaining a healthy gearing ratio. Interest Rate The interest rate risk carried by the Group relates primarily to interest-bearing financial assets and debt obligations. We manage this risk by: a) Maintaining a debt portfolio with both fixed and floating interest rates. b) Leveraging interest rate derivatives to hedge against interest rate exposure for specific underlying debt obligations after considering prevailing market conditions. Foreign Exchange The Group is exposed to foreign currency fluctuations arising from sales, purchases and monetary assets and liabilities that are denominated in a currency other than the respective functional currency of the Group’s entities. We manage this risk by: a) Pursuing ‘natural hedges’ by matching receipts and payments, and making asset purchases and borrowings in the respective foreign currency, where possible. b) Leveraging forward foreign exchange contracts or cross-currency swaps to manage foreign exchange exposures. c) Monitoring foreign exchange risk on a continual basis. For more information on the Group’s Financial Risk Management, please refer to the Financial Risk Management section on page 173 of this annual report. ANNUAL REPORT 2024 CORPORATE GOVERNANCE 39
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