The company's internal and external risks that may adversely affect the achievement of business objectives are identified and assessed on a regular basis. Risk management identifies the threats and opportunities that affect the implementation of strategy. The objective of risk management is to support the achievement of objectives set in strategy by making sure that the risks taken are proportionate to the company's risk-bearing capacity and that the continuity of operations has been adequately ensured.
Supervision and risk management
The objective of internal supervision is to ensure that the company’s key objectives are achieved. The achievement of the objectives is assessed largely on the basis of reports obtained from business operations.
Internal supervision is carried out using several different methods, such as management, organising operations and organisational culture, identifying and assessing risks, continuous supervision, reporting and communications, and follow-up and audits.
Internal supervision procedures are applied to all crucial operations and cover all crucial processes and even individual tasks. The scope and nature of the company’s operations are taken into consideration when defining the procedures.
External auditors assist the company’s Board of Directors, CEO and Management Team in ensuring that internal supervision is adequate and, in particular, that financial information is correct.
The Board of Directors of Solidium is responsible for organising adequate and well-functioning internal supervision and for monitoring supervision measures. The company’s Board of Directors monitors that internal supervision functions well and is adequate and, based on observations obtained through internal and external supervision, ensures that the principles concerning the organisation of operations are met and that control within the company is functioning well.
As part of the organisation of internal supervision and risk management, the company’s Board of Directors regularly monitors the company’s operational result, the value development of investments and risks arising from the company’s operations. It also decides on reporting, procedures and qualitative and quantitative benchmarks with which the efficiency and profitability of operations are measured. The Board of Directors is also responsible for ensuring the liquidity and funding necessary for the company’s operations.
The company has a compliance officer in charge of its compliance function. The compliance officer is responsible for the following duties:
- monitoring developments and changes in legislation and official instructions and regulations,
- informing the company’s management and other personnel of such changes,
- preparing and maintaining the company’s internal policies, guidelines and ethical and other principles concerning personnel in cooperation with the company’s management and
- monitoring compliance with these policies, guidelines and regulations.
The General Counsel is the company’s compliance officer. The General Counsel participates in the company’s business operations. Taking the scope of the company’s operations into account, compliance operations have not been separated from the company’s business operations. The compliance officer reports to the CEO.
Risk management process
Solidium’s internal and external risks that may adversely impact the achievement of business objectives are identified and assessed on a regular basis. The purpose of risk management is to identify the threats affecting the implementation of strategy and the efficiency and profitability of the company. The objective of risk management is to support the achievement of the objectives set in strategy by making sure that the risks taken are proportionate to the company’s risk-bearing capacity and that the continuity of operations has been adequately ensured.
The company does not have a separate internal supervision and risk management organisation that is independent of the business operations. In cooperation with the Chairman of the Board of Directors, the CEO and the Investment Directors, the General Counsel organises the monitoring of the company’s operational and financial objectives, makes sure that management information is correct and that external and internal reguLations are followed, and identifies and assesses key risks related to business operations.
As a result of the risk management process, Solidium prepares a risk chart and risk monitoring report which are used to determine, assess and classify Solidium’s risks and to monitor the implementation of the required risk management measures.
According to Solidium’s Articles of Association, the Annual General Meeting must elect one auditor for auditing the company’s accounting, financial statements and corporate governance, and the auditor must be a firm of authorised public accountants certified by the Finland Chamber of Commerce. The term of the auditor expires at the end of the Annual General Meeting following the election.
The auditors’ task is to inspect the company’s accounting, financial statements and corporate governance in order to ensure that the operations of the company and its administrative bodies compLy with the law. The auditors also supervise that financial statements have been prepared in accordance with valid rules and regulations and provide shareholders and other stakeholders with sufficient information on the result of the company’s operations and the company’s financial position.
The auditors annually supply the Annual General Meeting with an auditor’s report, in which they provide a statement on the content of the financial statements, the proposal for the distribution of profits, and the discharge from liability. In addition, the auditors prepare audit memos based on their observations. If necessary, the auditors may provide oral reports at meetings of the Board of Directors and General Meetings.
Taking into account the scope of the company’s business operations, the company does not have a separate internal audit function. The company’s Board of Directors regularly commissions external evaluations of the adequacy of internal supervision or carries out targeted internal audits.