Annual Report 2020

RISK MANAGEMENT INITIATIVES IN 2020 During the Financial Year, the RMD focused on strengthening the structure and documentation for ERM across the Group, increasing Management participation in risk management, providing robust risk management education and awareness, and completing targeted business impact analyses and recovery plans testing. A key initiative was the formation of a Management level risk committee (“MRC”) to increase participation by Management in risk management processes. The MRC is tasked to review the key risks of the Group prior to submission to the RMC every quarter. The RMD also identified and established Crisis Management Teams across the Group to respond to business continuity events and conducted BCP exercises for key systems, functions and stations to minimise significant operational disruptions in the event of a crisis across the Group. The Group’s significant risks and mitigation actions are broadly categorised as follows: RISK MITIGATION A. STRATEGIC 1. Political and Environment Uncertainty Political instability, market downturn, natural disasters, health epidemic and any other events that are outside of the Group’s control in geographical areas where the Group operates that could affect its business operations. 2. Competition Intense competition in the market place arising from new entrances of players, expansion of competitors’ networks and fare wars. 3. Reputation and Branding Reputational damage that arises through adverse media publicity and social networks which are caused by consumer grievances or any specific campaigns that brings about any negative sentiments against the Group. The Group mitigates this risk by having constant monitoring of information relating to those areas that can impact its business operation. This pertinent information is used to reduce that impact by adjusting the asset allocations, capacity management and promotions. The Group has also established Crisis Management Teams that will respond and reduce the impact of a crisis on its business operations. The Group mitigates this risk by strengthening its route network, expanding into greenfield markets which attract “first entrant” incentives such as airport charges and by offering competitive fare adjustments. The Group mitigates this risk by having a Social Command Centre which operates on a real time basis; to monitor and respond urgently to any adverse media publicity or consumer grievances. Further to that, a media monitoring service is utilised to monitor and notify the Group of any targeted media coverage that could in the event create any reputational threats. 153 ANNUAL REPORT 2020