Bakkavör Group has a risk management framework in place which provides a structured and consistent process to identify, evaluate and manage risk in relation to the Group’s strategy and business objectives. Our risk management processes are operational at all levels of the Group. The Bakkavör Group Board has the ultimate responsibility for risk management, which includes the risk governance structure and the maintenance of an appropriate internal control framework.

Board agenda

Bakkavör Group is faced with a number of risks in its business environment and has identified five key areas of risk which must be managed in order to ensure the long-term sustainability and profitability of the Group:

• Sustainable growth
• Operational safety
• Customer relationships
• Consumer understanding
• Shareholder value
  

The Board ensures that the Group has the necessary capabilities, expertise, processes and controls in place to manage risk in each of these areas.

Sustainable growth

Bakkavör Group has been characterised by substantial growth in recent years. The Group has set itself ambitious growth targets and aims to continue to grow both organically and through strategic acquisitions. It is important to ensure that our business remains sustainable and profitable whilst it grows. Major acquisitions entail numerous risks for Bakkavör Group. These relate primarily to the Group’s ability to execute the integration and realise the benefits underlying the rationale of the acquisition. Underestimating the importance of cultural integration is also a risk in merging companies. Any factors leading to failed integration would have an adverse effect on Bakkavör Group’s operations.

Operational safety

The operational Health and Safety of our employees and the quality and safety of the products we make and sell is paramount to the continued success of our business.

Employee training is critical to the management of operational and food safety and we are committed to providing this at all levels within our operations.

All our factories operate documented quality management systems (QMS) based on Hazard Analysis Critical Control Point (HACCP) principles and customer Codes of Practice. These systems manage the risk of failed internal processes and human error and ensure that the products manufactured are safe, legal, of the quality required by the individual customer and made in a secure and safe working environment.

Traceability is a critical component in our management of food safety, allowing us to trace ingredients quickly from the source through to the finished product and vice versa. We work closely with our suppliers to source safe, legal, quality ingredients to a consistent standard. This includes regular visits to their factories to assure ourselves of the integrity of their quality systems and factory operations.

Customer relationships

As with most suppliers in the fresh prepared foods sector, our customers are few, but of critical importance to us, and it is our intention to continue to build strong relationships with them. Our products carry our customers’ brand names and we develop products in close partnership with our customers. At various levels of our organisation, our employees talk to their customer peers (often daily). At a senior level, we appoint ‘Customer Champions’ who are responsible for managing overall customer relations with their specific contacts. This communication facilitates the day-to-day business as well as longer-term strategic planning.

Consumer understanding

At the heart of our success are the people who buy and eat our finished products – our consumers. It is important for us to listen to their demands in order to provide them with innovative meal solutions which are of high quality and quick and easy to prepare. As such development and innovation skills must remain a high priority in our business.

Shareholder value

The principal goal of Bakkavör Group is to provide good, long-term returns for its shareholders and we value the trust that our shareholders place in us. The key to achieving this goal is the development and communication of a clear strategic vision and the recruitment and retention of talented management to implement it.