Risk management and internal controls over sustainability reporting [GOV-5]
The most important risks evaluated concern identifying material topics, carbon accoun- ting and availability of data on health and sa- fety in line with ESRS requirements. Review and approval of the materiality assessment by the Management Board and the Super- visory Board, in particular the Audit Com- mittee, along with the associated material impacts, opportunities and risks minimises the risk of failing to cover an adequate range of material topics. With regard to environmental datapoints, spot checks on datapoints conducted on an annual basis serve as a key control mecha- nism. These checks help to ensure that input or transmission errors are prevented and minimised. In addition, emissions calculations are checked for completeness, accuracy and timeliness as part of a dual control conducted by employees from both the Lighting and the Components segments. The COO receives updates on the current status of environmental metrics at monthly review meetings. Annual process and system reviews are conducted as part of internal and external audits, in accordance with ISO 14001 and ISO 50001, for instance. With regard to the datapoints in Section E5 – Circular economy, close interdepartmental information sharing takes place, thereby ensuring second-party review throughout the entire data genera- tion and evaluation process. In particular, the ongoing standardisation of the calcula- tion methodology for the ‘Recycling Content’ datapoint helps to reduce potential sources of manual error. With regard to social aspects, metrics on employee health and safety are presented to the COO at monthly review meetings. Consistent reporting on metrics throughout the year ensures that the relevant metrics are both complete and available for analysis. Process and system reviews are conduc- ted as part of annual internal and external audits, in accordance with ISO 45001, for instance.
The Zumtobel Group’s risk management system is closely linked to the controlling processes and internal control system in place and has interfaces to many other business areas. Synergies are leveraged through the regular exchange of information. Among other things, findings from the risk assessments conducted on a biannual basis under the umbrella of the Group-wide risk management process provide a central ba- sis for the financial materiality assessments in the materiality assessment. Financial risks and opportunities are identified in coope- ration with the respective specialist depart- ments and actions are compiled in the risk management software used throughout the Group. External reports, such as the FM Global Risk Report on climate risks at the respective sites, are also used as reference. The Zumtobel Group’s risk management system and the material risks and options for action are discussed under Risk Manage- ment. Targeted internal controls have been rolled out by the Zumtobel Group as part of the internal control system to minimise the risk associated with the sustainability reporting process. These controls have been imple- mented across departments and cover, in particular, the data collection process, data processing, the calculation methodology used and verification of the reported data. Comprehensive data checks are conducted in select areas, in particular with regard to the completeness, accuracy and timeliness of the datapoints to be reported. The data is provided by the relevant departments. Qua- lity assurance and completeness checks are carried out by designated quality control offi- cers, documented accordingly and reviewed by a second party in close collaboration with Group Sustainability.
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