Principal risks

The Group has a clear framework in place to continuously identify and review its principal risks.

Key risks are plotted on risk maps with descriptions, owners, and mitigating actions, reporting against a level of materiality consistent with its size. These risk maps are reviewed and challenged by the Executive Leadership Team and Audit Committee. Additional risk management support is provided by external experts in areas of technical complexity to complete our bottom-up and top-down exercises.

The table below summarises the principal business risks. Further details on these, including potential impact, mitigating actions and assurance, can be found in the Group’s 2017 Annual report and Accounts and interim results of 1 May 2018.

  • Health & Safety

    The risk of failing to provide employees with appropriate training and a safe environment results in serious injury to employees and/or the public. Combined with the risk that the Group fails to comply with relevant Health and Safety legislation.

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  • Non-Adherence to transport operator licence conditions

    The risk of failing to adhere to external laws and regulations by employees, sub-contractors and third parties resulting in a breach of our Transport Operator Licence conditions.

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  • Changing consumer behavior

    The risk of new technologies and demographics drive change in customer behaviour and/or supply chain dynamics that result in structural market changes being deeper and quicker than predicted, including migration from print to digital, reducing demand for our services.

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  • Optimising contract renewals and tendering

    The risk of failing to retain major contracts at acceptable rates and /or win new contracts in competitive markets affected by aggressive pricing strategies impacts current and projected business performance.

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  • Increased labour market constraints and costs

    The risk of legislative changes or interpretation impact the engagement of employees and delivery contractors resulting in an increase in the number of employees and/or liabilities and cost.

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  • Network and IT robustness

    The risk of Network and IT disruptions in key infrastructure facilities leads to an inability to deliver according to customer expectations and contractual obligations.

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  • Failure to execute strategy

    The risk of failing to deliver business plans and/or financial returns in line with the planned strategic evolution of the Group, impacts external confidence and shareholder perception, bringing into question the future strategic direction and confidence in its delivery.

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  • Constraints on capacity and/or failure to execute restructuring and other change management programmes

    The risk of failing to re-engineer the business to create a platform for future growth combined with excessive demands on new and existing resources and capability results in loss of customers or key people impacting both current and future business prospects.

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  • Deterioration of the macro economic environment

    The risk of volatility and/or prolonged economic downturn causes a decline in demand for our services including the uncertainty associated with Brexit, impacts current and/or projected business performance above that included in the business planning and review process.

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  • Ability to attract, engage and retain talent

    The risk that we do not attract the people and skills needed to achieve our targets and that employees are not motivated towards, or are disengaged from, the goals of the Group. The associated risk that the HR processes and systems do not support the changes in culture and expertise that is required for success.

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Investor Contact

For all enquiries concerning Investor Relations, please use the contact details below:

Phone: 01793 563638
Email: investor.relations@connectgroupplc.com

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