Enterprise Risk Management

Risk Management System

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Purpose and Scope

All activities undertaken by Maynilad carry an element of risk. It is inherent to the Company’s business environment; therefore, risk management should be a central part of business’ strategic management. Embedding risk management principles into strategy development and day-to-day operational processes is critical to achieving robust and proactive business outcomes – a balance between mitigating threats and exploiting opportunities.

This policy aims to (i) express Maynilad’s commitment to a comprehensive approach to Risk Management; (ii) clarify organizational roles and responsibilities; and (iii) outline the structure, framework and guidelines in managing its vulnerabilities.

General Policy Statement

As a water utility Company serving the west concession area of Metro Manila and nearby provinces, Maynilad understands that there are inherent risks to its business environment. These risks, if not properly managed, could threaten its ability to provide quality service and meet its business objectives and obligations to its various stakeholders.

Maynilad shall identify and manage these risks at the appropriate levels. It shall address the opportunities and threats by adopting an Enterprise Risk Management System (ERMS). This ERMS includes the ERM Framework and the specific processes in the management of risks in order to help the Company achieve its objectives and desired performance results.

Distribution

This policy applies to all Business Units (“BUs”) to enable them to complyu with the risk management requirements set out in this policy.

Risk Management System

Maynilad shall adopt a Risk Management System (“RMS”) that is consistent with the ISO 31000 Risk Managment principles and guidelines as shown below.

1. Principles

Value Creation and Protection
  1. Integrated
  2. Structured and comprehensive
  3. Customized
  4. Inclusive
  5. Dynamic
  6. Best available information
  7. Human and cultural factor
  8. Continual improvement

2. Framework

3. Process

1. Principles

a. Maynilad’s Risk Management System (RMS) shall adhere to the principles of protecting and creating value for the business. It aims to:

  1. establish and sustain value;
  2. be integrated in the organizational processes and decision-making;
  3. deliberately address uncertainty;
  4. be structured, systemic, and timely;
  5. be based on best available information;
  6. take human and cultural factors into account;
  7. be transparent and inclusive;
  8. be dynamic, iterative, and responsive to change; and
  9. facilitate continual improvement of the Company.
2. Framework
  1. Maynilad shall follow a Risk Management Framework that fosters key leadership commitment from top management to integrate, design, implement, evaluate and continually improve its approach in addressing its vulnerabilities. This RMF shall be anchored on strong ownership, responsibility, authority and accountability over the risks inherent to the Business Unit operations.
  2. The Division Heads as the overall owners of the strategic and operational risks within their respective Bus shall provide the leadership and commitment in driving the appropriate risk management initiatives. These initiatives shall balance the cost of managing the risks and the anticipated benefits. These shall also include contingency plans to ensure business continuity and recovery from disaster should this occur.

ERMIA shall regularly review the implementation of this policy, and initiate its revisions/updating, as may be necessary under the circumstances.