Risks and uncertainty factors

Systembolaget’s vision for our risk management is an operation in which the risks to which the company is exposed are identified at an early stage. Our owner shall feel secure in the way in which Systembolaget fulfils its mandate and manages its risks.

Risk is defined in this context as “an event that prevents Systembolaget from achieving its social mandate and its goals”. The risks are managed on the basis of the degree of impact that they may have on the company and its mandate.

Company-wide risks

Systembolaget conducts an annual company-wide risk analysis that is divided into the following five process stages:

  1. Identification
  2. Evaluation
  3. Prioritisation
  4. Management
  5. Monitoring

The risks are identified and evaluated by managers, key individuals within the operations and company management.

The principle used when evaluating risks is that Systembolaget has a low level of risk appetite and tolerance, particularly with regard to danger to the lives of our employees and the public and with regard to the company’s existence, mandate or brand. Systembolaget conducts a strategic programme of sustainability work in areas such as human rights, working conditions, the environment, and anti-corruption. This means that sustainability risks are also included in the company-wide risk analysis. Read on to find out about our new audit selection model, for example, which will improve our ability to monitor working conditions in our supply chain.

Work in 2016

The risk analysis work in 2016 identified 90 risks. These were prioritised by evaluating their probability and consequence. The risks are managed and followed up as part of the process of operational monitoring. The ten highest rated risks are also monitored by the Board of Directors.

The highest rated risks relate to threats to the monopoly, namely a lack of clarity in alcohol-related legislation with reference to e-commerce, the increasing marketing of alcohol, and support for Swedish alcohol policy. Systembolaget has no control over these risks but must adapt its behaviour in line with them as well as manage them.

One of the sustainability risks relates to the ability to comply with our external Code of Conduct. The highest rated strategic risks evaluated in the 2015 risk analysis were all within the same areas, and the highest rated operating risks include threats and violence to Systembolaget’s store personnel, and increased sick leave.

Financial risks

Financial risks, such as interest rate, credit, and liquidity risks are limited at Systembolaget. See Note 13 Financial instruments, for additional information on financial risk management.

Systembolaget’s risk management

Overall responsibility for risk management in Systembolaget lies with the operational managers. A manager who is responsible for their operations within the organisation is also responsible for the operations’ risks and the way in which they are managed. This is clearly stated in the annual business plan, in which risk management activities are planned and monitored. The risk management work is monitored by the company management and, twice yearly, by the Board of Directors.

The internal audit, which is carried out by an external company, reviews and evaluates Systembolaget’s operations, including its risk management work.