Rexam PLC Annual Report 2011

34 Rexam annual report 2011 directors’ reportkey risksenterprise risk managementEffective management of risk is essential tothe achievement of our business objectivesand to the protection of our people, assetsand reputation. Identifying, assessingand managing risks is integral to the waywe run our business. It is part of our focuson operational excellence and bestperformance which are key priorities forthe Group. The various risks attached to ouractivities are consistently assessed, recordedand reported in a visible, structured andcontinuous manner to ensure necessarycontrols are in place.Rexam risk management processRexam objectivesRexam risk management processThe enterprise risk management function reports directly tothe chief executive. The function serves to further improve theintegration and efficiency of our risk management framework and,in doing so, to address the increased demands and requirementsfrom external and internal stakeholders. It draws together our riskbased responsibilities and enhances the good risk managementprocess and practices already in place across the Group.This section describes our well established risk managementprocess including the enhancements made during 2011,and outlines the main factors that may affect the implementationand execution of our strategy.Rexam objectivesThe purpose of the Rexam risk management process (knowninternally as the ARC process) is to support achievement of Rexam’soverall objective to deliver shareholder value. Although risk cannever be eliminated, the process aims to identify and setappropriate mitigation responses for the key risks faced by Rexam.The approach is based around the ISO 31000 risk managementprocess and on both the bottom up and top down assessmentsof strategic, financial and operational risks.risk identificationThe first stage of our risk management process is to identify therisks faced by Rexam. This is initially a bottom up process withbusiness units and functions undertaking a biannual process ofrisk identification. Risk workshop sessions, current risk registers,intelligence on risks identified by other companies and a riskcategorisation check list are used to structure and support theprocess. The enterprise risk management function leads andsupports the process but is also there to challenge the findings.Executive directors and other senior leaders are closely involvedat critical stages in the process. They review, challenge and debatethe risks identified from a top down perspective. The resultantoutput is a list of risks faced by Rexam for each business unit andfunction – the risk register.risk identificationrisk assessmentrisk mitigationrisk reportingrisk monitoringdevelopment