See the Annual Report 2020/21 for a detailed description of voestalpine’s risk management.
The following risks among others are monitored:
- Availability of raw materials and energy supplies
- Climate change risks
- Failure of production facilities
- Failure of IT systems
- Compliance risks
- Risks associated with data privacy and protection
- Risks from the financial sector
Physical Risks of Climate Change
The voestalpine Group has taken comprehensive proactive measures to deal with risks from natural disasters such as floods or low water levels, heavy snowfall, droughts as well as strong wind or fluctuations in temperatures. This includes regular run-throughs as well as inspections and risk surveys that are conducted jointly with insurance companies. At some facilities, especially those located along coasts (e.g., Texas, USA) or rivers (e.g., Linz, Austria), changing water levels also pose risks. voestalpine monitors these and other physical risks on a regular basis and verifies whether the existent emergency plans and structural measures such as fire alarms, sprinklers, and flood control measures continue to provide adequate protection.
In addition to the steps taken within the company, regular information sharing with internal and external insurance companies helps to minimize the fallout from such risks for the Group. As regards raw material supplies (e.g., deliveries by ship to the Linz plant), any climate-induced fluctuations in river water levels and any resulting difficulties in the navigability of rivers (e.g., the Donau River) are considered situationally based on the number of ships utilized and the freight volume.
Other Material Sustainability Risks
Risks from areas such as personnel issues, respect for human rights, and the fight against corruption are taken into account at all levels. For details, see the respective sections of the present CR Report.
Risks from the COVID-19 Pandemic
The COVID-19 pandemic and the resulting medical, economic, and social state of emergency defined the business year 2020/21 also. As part of its crisis management, voestalpine immediately established crisis teams on three decision-making levels (Group, division, company) at the start of the pandemic to ensure rapid and coordinated action in response to the complex challenges and risks facing all Group companies.
These crisis teams were able to quickly implement measures to protect the Group’s workforce and to maintain operations. Wherever possible, employees worked from home, and the company provided the requisite equipment and infrastructure to them on short notice. Protective personal equipment (PPE), information, and materials for required hygienic care were made available to all employees who continued to work on site. Supplementary measures aimed at overcoming the economic crisis involved securing the company’s liquidity, introducing short time work and/or reducing time credits as well as implementing early vacation closures. Production activities were adjusted to the prevailing supply chains and curtailed as necessary; in some cases, temporary production shutdowns were necessary as well. All this was accompanied by regular exchanges of information with key customers and suppliers. Emergency and crisis plans were put into action. They are still being evaluated on an ongoing basis alongside the measures taken and are adjusted or expanded as necessary in light of new requirements.
All of this enabled the Group to quickly adjust to the new situation and to protect both the operations and the stability of the organization during the difficult business year 2020/21.