SUSTAINABILITY REPORT 2018

RISK MANAGEMENT AND ETHICS

*** You can check the table by scrolling to the right

Priority Areas 2018 Goals Performance in 2018 Status 2019 Goals
Risk Management Continue to update and further develop the ERM website. ERM website has been
updated. Transfer of ERM website to new portal is ongoing.
Achieved
  • To revise and update the approach for establishing the consolidated risk dashboard at the Group Level
  • Utilizing Videoconferencing as a tool for some internal audits to save time and be more environment-friendly

Risk Management at CCI

CCI Board’s Risk Committee oversees the risk management. Enterprise Risk Management (ERM) Team, directly reporting to the CEO and the Risk Committee, acts as the facilitator and conducts risk assessments. ERM team members are the CEO, the Strategy and Business Development Director and Regional Directors.

ERM conducts risk assessment on country and group levels using the input from the World Economic Forum, global surveys and The Coca Cola System. The risks are prioritized based on their general likelihood, and the probability of occurence in the short-term and impact.

CCI Country Operation Managers are responsible for risk management and mitigation. They identify the critical threats and opportunities based on the risk assessment results, integrate them into their Strategic Business Plans and prepare the mitigation action plans. High-priority risks are reported to the Board’s Risk Committee along with mitigation action plans.

Internal Audits are performed to track the risk mitigation plans and the results are reported to the Audit Committee.

CCI country management uses the pillars in the company’s strategic business plan to evaluate
business risks. CCI’s principal risks and key mitigations are given below:

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Risk Pillar Principal Risk Key Mitigations
Environmental Community & Stakeholder Relations
  • Implement locally relevant projects with local and international project partners.
  • Drive stakeholder perception through transparency and reporting practices.
Water Scarcity
  • Water reduction activities at plants.
  • Continue local replenishment and access to water program.
  • Sustainable sourcing.
Waste Water
  • Wastewater treatment systems.
  • Periodic analysis.
  • ISO 14001 EMS and KORE Audits.
Energy
  • OE Projects, Behavioral Energy Program.
  • Improve energy efficiency (achieve energy use ratio targets)
Climate Change
  • Energy efficiency and GHG emission reduction programs at plants, logistics and cooling operations.
  • Post-consumer packaging programs to reduce packaging materials and GHG emissions.
  • Policy making and engagement with NGOs and legal authorities.
  • Investigate alternative clean energy sources.
Water
  • Conduct SVA studies.
  • Follow-up of Source Water Protection Plan.
  • Implementation of water efficiency projects.
  • Improvement of WUR (water use ratio).
Supply Chain Food Safety
  • Implementation KORE audits and International Standards.
Packaging
  • Implementation of sustainable packaging and waste solutions.
    Maintaining packaging innovation, Lightweight, PlantPet, recycling activities.
    Coordination with local authorities for waste collection and recycling.
Supplier Management
  • Follow-up of SGP audit findings.
Quality
  • KORE audits and International Standards.
Legal & Compliance Compliance Risks
  • Establish an early warning mechanism for critical draft and recent regulations.
  • Lobby as an industry against unfavorable regulatory and tax initiatives of the government.
Ethics-Bribery & Corruption
  • Train employees on the Code of Ethics.
  • Encourage effective use of Ethic Hotline.
  • Implement ethics program.
Work Life Human & Workplace Rights
  • SGP Audits.
  • Follow-up SGP audit results.
  • Ethics Hotline.
Health & Safety
  • Hand in Hand Safety Program.
  • KORE Compliance Implementations.
  • Distributor safety process implementations.
  • Contractor safety process implementations.
  • Driving Safety Program.
Sustainable Talent Capability
  • Continue with talent development forum.
  • Effective cooperation with respected universities to build employer branding.
Cybersecurity Cyber-attacks that may cause data
leakage or service interruptions
  • Security program,
  • cyber resilience,
  • cyber risk insurance.

In 2018, risk assessments were conducted three times; in January, June and in August following the devaluation of Turkish Lira. CCI’s top risks for 2018 were instability in international politics and security, economic volatility, and corporate acceptance. Followed by these were capability building, regulatory taxes and changing consumer preferences. CCI’s principal environmental risks were assessed as post-consumer packaging, water scarcity and climate change.

CCI employees are regularly trained on risk management and informed via the ERM website, that is accessible through the CCI internal Portal. The website provides an ERM tool along with guidelines, leading articles, useful links and an awareness training presentation on ERM .

Outlook for 2019:

  • Understanding technology’s impact on strategy, business models and cybersecurity
  • Anticipating and planning for geopolitical and regulatory changes
  • Overseeing the culture and talent in an era of innovation and transformation
  • Engaging with the stakeholders on long-term governance, environmental and social issues