Page 119 - Tata_Chemicals_yearly-reports-2021-22

01 INTEGRATED 73 STATUTORY 178 FINANCIAL
STATEMENTS
REPORT
REPORTS
Management Discussion
& Analysis
a pivotal framework that allows the Company to gain The Company’s business model is subject to uncertainties
insights into its performance and establish continuous that may cause actual results to differ materially from those
improvement initiatives for attaining superior business reflected in any forward-looking statements.
results and maximising satisfaction and value to the Overview
customers. The TBEM framework comprises six core areas
of business excellence: Leadership, Strategic Planning, The Company has a well-defined ERM framework in place.
Customer Focus, Analysis and Knowledge Management, The ERM framework has matured over several years. It is
Workforce Focus and Process Management. For the founded on sound organisation design principles and is
Company, a global organisation that has its manufacturing enabled by an effective review mechanism.
operations spread across four continents, with diverse Risks are identified proactively considering a balanced
business segments and employees from different cultures, ‘bottom-up’ and ‘top-down’ approach considering inputs
TBEM serves as a platform to establish a consistent from exogenous as well as internal factors. Risk mitigation
standard of excellence. The Company participated in plans are devised to mitigate the identified risks. Mitigation
the Tata Group level TBEM assessment in 2021 and plans with identified owners are set against target dates
achieved a coveted Industry Leader status. This affirms the and the progress of mitigation actions are monitored and
Company’s commitment to strengthen the culture of reviewed.
excellence and progress towards becoming a world-class
organisation. The ERM process framework is based on international
standards including ISO 31000 and the Committee
14. Internal Controls of Sponsoring Organisations (COSO) of the Treadway
Commission with inputs drawn from the best practices of
The Company has an independent Internal Audit function leading companies across industries but tailored to suit the
with a well-established risk management framework. Company’s business needs. Risk Management and Internal
The scope and authority of the Internal Audit function are Audit functions complement each other at the Company.
derived from the Internal Audit Charter approved by the
Audit Committee. The Company has engaged a reputable Risk Management: Governance Structure
external firm to support the Internal Audit function for The Company has constituted a robust governance structure
carrying out the Internal Audit reviews.
consisting of 5 levels thereby ensuring both bottom-up and
Reviews are conducted on an ongoing basis based on a top-down approaches.
comprehensive risk-based audit plan which is approved A Risk Management Committee (‘RMC’) is constituted to
by the Audit Committee at the beginning of each year. oversee the risk efforts in the Company. The RMC meets
The Internal Audit team reviews and reports to quarterly to review key risks and assess the status of mitigation
the management and the Audit Committee about measures. The Company’s approach to risk management is
compliance with internal controls and the efficiency and designed to provide reasonable assurance that its assets are
effectiveness of operations as well as the key process risks.
safeguarded; the risks facing the business are being assessed
The Audit Committee meets every quarter to review and and mitigated.
discuss the various Internal Audit reports and follow up on The risk management framework is described below:
action plans of past significant audit issues and compliance
with the audit plan. The Chairperson of the Audit Committee
has periodic one-on-one meetings with the Chief Internal
Auditor to discuss any key concerns. The Risk
Management
15. Risk Management Framework Framework
Board of Risk
The following section discusses various dimensions of the Directors Owners
Company’s Enterprise Risk Management (‘ERM’) system.
The risk-related information outlined in this section is Risk RMG at Business
not exhaustive and is for information purposes only. Management Risk Unit Level/
Committee of
The discussion may contain statements that may be the Board Management Subsidiary
Level
forward-looking in nature. Group (RMG)
at Senior
Leadership Level

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