Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 81
Other Risks
Production risks concern technical disruptions or human failure
in production that can be harmful to people or the
environment. Our goal is to minimize the effects of machine
failure on the value chain by operating production lines independently
from one another. It is compulsory for our staff
to receive training in the clearly defined process and quality
standards in the areas in question. In addition, we conclude
property damage as well as plant and equipment breakdown
insurances.
Information technologies form the basis of nearly all of
ALTANA’s business and communications processes. Breakdowns
or other disruptions of IT systems can lead to far-reaching
impairments in all of the Group’s value-added stages,
which can have significant effects on business performance
(IT risks). In addition, potential risks arise from data loss or
theft of business secrets. ALTANA attaches great importance
to smooth availability of IT applications and services. To
guarantee this, corresponding processes and organizational
structures have been established. Emergency plans are
in place in case of significant disruptions or losses of data.
Delivery of faulty products can cause damage to people, property,
or the environment and thus cause liability risks. This
can have significant effects on the Group’s asset situation. We
minimize this risk by standardizing production processes to
a large extent and by taking comprehensive quality-control
measures. In addition, we continually conduct analyses
to assess the hazardous potential of our input materials and
products, and we conclude insurances.
Changes in political and regulatory framework conditions
can lead to restrictions on trade or foreign-exchange transactions.
Due to political unrest, it can be more difficult or even
impossible to access the Group’s assets in the country or
countries in question. On account of regulatory adjustments,
it might no longer be possible to process or sell certain
products or ingredients, or only with strong restrictions. We
continually examine the political environment in the coun-
tries important for us and take current tendencies into account
when evaluating business relationships. We only make
direct investments in countries in which we assume the political
environment is highly stable. We actively take part in
legislative procedures and discussions important for us that
focus on changes in the regulatory environment. As a
result, we can anticipate possible new requirements early on.
In the past fiscal year, with the probability of occurrence
remaining largely unchanged overall, the damage values
increased slightly, particularly for risks due to imposed
government lockdowns and the new introduction of the
Supply Chain Act.
Due to the transnational impact of the pandemic and
any measures that may be required to contain its further
spread, production processes and / or supply chains may be
impaired or interrupted and product sales may be impeded.
As a result, there is a risk of economic damage. The further
course of the pandemic may have an impact on the economic
development of all of ALTANA’s sales markets. Both the
duration and the specific impact on the economic development
for ALTANA in 2021 depend on the effectiveness of
the vaccination programs and the further countermeasures
to contain the pandemic. The possible financial effects were
taken into account in the planning figures and scenario
analyses for 2021 based on them.
The United Kingdom left the European Union on January
31, 2020, with an exit agreement. Shortly before the
end of the transition period on December 31, 2020, an agreement
was reached between the negotiating parties on a
trade agreement on December 24, 2020. On December 31,
2020, the agreement was ratified by the British Parliament
and could thus enter into force provisionally on January 1,
2021. Ratification by the European Parliament, which is
still outstanding, is planned for the first half of 2021 following
examination of the trade agreement. The far-reaching