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Consolidated Financial Report |
DIRECTORS’ REPORT
2014 Annual Report
Prysmian Group
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Any loss of one of these assets due to unforeseen natural
disasters (eg. earthquakes, storms, etc.) or other accidents
(eg. fire, terrorist attacks, etc.) and the consequent prolonged
business interruption could have a critical economic impact
on the Group's performance.
Prysmian addresses this risk through its systematic Loss
Prevention program, under which specific inspections of the
above assets allow it to identify the level of local risk and
define actions that could be necessary to mitigate such risk.
As at 31 December 2014, all of the plants inspected were clas-
sified as "Excellent HPR", "Good HPR" or "Good not HPR";
no plant was classified as medium or high risk. In addition,
specific disaster recovery plans have been developed that,
by predetermining loss scenarios, allow all the appropriate
countermeasures to be activated as soon as possible in order
to minimise the impact of a catastrophic event.
Lastly, specific insurance cover for damage to assets and loss
of associated contribution margin help minimise the risk's
financial impact on cash flow.
Environmental risks
The Group's production activities in Italy and abroad are
subject to specific environmental regulations, of which
particularly important are those on soil and subsoil and on
the presence/use of hazardous materials and substances,
including for human health. Such regulations are imposing
increasingly strict standards on companies, who are therefore
forced to incur significant compliance costs.
With more than 89 plants, there is a theoretically high proba-
bility of an accident with consequences for the environment,
as well as for the continuity of production. The resulting
economic and reputational impact would be critical.
The Group's policy of acquisition-led growth could augment
its exposure to environmental risks, with the addition of
manufacturing facilities that fall short of its standards.
The management of environmental issues is centralised
with the Health Safety & Environment (HSE) function that,
by coordinating the local HSE functions, is responsible for
organising specific training activities, for adopting systems
to ensure strict adherence to regulations in accordance
with best practices, as well as for monitoring risk exposures
using specific indicators and internal and external auditing
activities.
Lastly, it is reported that 93%of the Group's sites are certified
under ISO 14001 (for environmental management systems)
and 58% for OHSAS 18001 (for safety management).