Risk Assessment and Management Policy
Every Company is prone to some business risks or other. “Risk” denotes happening of an event having adverse or harmful effect on the business.
It is the responsibility of every management to identify the possibilities of the risks, take necessary steps to protect against the risks, mitigate the risks, indemnify against the risks, and generally plan for safeguarding the business from the harmful effects of risks.
Section 134(3)(n) of the Companies Act 2013 provides that every company must include a statement, in the Board’s Report to the Shareholders indicating the development and implementation of a Risk Management policy, thereby making it mandatory for the companies to develop and implement such a policy.
Accordingly, the Board of Directors of Thyrocare Technologies Limited have formulated this Risk Management policy.
The Board may review and amend this policy from time to time.
“Audit Committee” means Committee of Board of Directors of the Company constituted under the provisions of the Companies Act, 2013.
“Board of Directors” or “Board” in relation to a Company, means the collective body of Directors of the Company.
“Company” or “The Company” means Thyrocare Technologies Limited.
“Risk” means happening of a negative or unfavourable occurrence or non-happening of a positive or favourable occurrence, resulting in a harmful or damaging impact on the course of the business.
“Risk Management” means coordinated precautionary actions planned or taken to prevent the occurrence of risks, control their damaging impact and minimise the losses arising out of such risks.
“Policy” means Risk Management Policy of the Company.
The main objective of the Risk Management Policy of the Company is to establish a pro-active approach in foreseeing, evaluating, controlling, mitigating and resolving all kinds of risks associated with the business, so as to ensure sustainable business growth with stability.
In order to achieve the above objective, the policy establishes a structured and disciplined approach to Risk Management to facilitate taking informed decisions on risk related issues.
In the perception of the management, there could be the following types of material risks, viz.
1. Technological Risks;
2. Operational Risks;
3. Financial Risks;
4. Human Resource Risks;
5. Legal / Regulatory Risks;
6. Environmental Risks; and
7. Force Majeure Risks.
Risk Management envisages addressing to the following tasks in dealing with the above risks:
i) Identifying potential threats and their impact on the business;
ii) Assessing the likelihood of occurrence;
iii) Taking necessary measures to eliminate or control the factors that might lead to occurrence of such risks;
iv) Planning for remedial steps in the event of occurrence of the risk;
v) Chalking out strategies to restrict the consequential damages;
vi) Taking steps for mitigating or minimizing the losses and other damages; and
vii) Preparing an action plan for restoring the business to its original position in the event of occurrence of the risk.
The following will be the approach:
1. To ensure that all the existing and future risk factors are identified, assessed, quantified and categorized into major, medium and marginal threats, and reported to the top management.
2. To put in place suitable systems that will give alarm signals to the top management in the event of any of the threat factors surfacing.
3. To comply with regulatory frame work in accordance with statutory requirements.
4. To adopt best business practices and policies.
5. To provide for adequate insurance against all kinds of insurable risks.
6. To establish a set of Do’s and Don’ts, and guidelines to be followed in the event of any risk taking place.
7. To periodically review all the risk protective measures and revise the policies, procedures and practices wherever necessary.
The Policy envisages monitoring as follows:
i) Regular checking or surveillance to prevent risks caused by human acts of commission and omission.
ii) Constant monitoring of the external environment to detect any possible risks that may be caused by economic, political, sociological or technological changes.
iii) Periodical reporting to the Audit Committee and to the Board of Directors, to facilitate broad-based discussions and conscientious decisions if needed to improve the checks and balances, and to make the Policy more effective.
iv) Implementation of decisions taken and reporting back to the Committee and to the Board.