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CORPORATE GOVERNANCE REPORT
complaints processing system; mystery shopper
programme; and programme of internal audits in
relation to food safety indicators.
– certification of the food safety management system
under ISO 22000, a demanding international food
safety standard.
Health and safety at work (HSW)
The management of this risk area is overseen by the Hu-
man Resources Unit, which coordinates training plans
and monitors the application of the rules and proce-
dures defined in Ibersol’s HSW Manual.
Financial
Risk management in the financial area is led by the Fi-
nancial Unit, which focuses on monitoring the volatility
of the financial markets, especially interest rate volatili-
ty. The current situation of the markets has led to liquid-
ity risk taking on greater importance. The main sources
of exposure to financial risk are:
A) EXCHANGE RATE RISK
Exchange rate risk is reduced, as the Group operates
mainly in the Iberian market. Bank loans are denomi-
nated mainly in euros and the volume of purchases out-
side the eurozone is small. The purchases and external
financing of the Angolan subsidiaries are also on a small
scale (given that a substantial portion of the assets are
funded with capital).
As regards future borrowings outside the eurozone, the
Group will pursue a policy of natural coverage, using fi-
nancing in local currency whenever interest rate condi-
tions make it recommendable.
The growth of the business in Angola translates into an
increase in exchange rate risk, which will affect the value
of the assets and liabilities.
B) INTEREST RATE RISK
As the Group has no interest-bearing assets with signif-
icant interest rates, the gains and cash flows of the fi-
nancing activity are substantially independent of chang-
es in market interest rates.
The interest rate risk for the Group comes from the lia-
bilities, namely long-term loans. Fixed-rate borrowings
expose the Group to fair value interest rate risk. With
the current level of interest rates, the Group’s policy in
long-term financings is to fully or partly fix the interest
rates.
Ibersol uses interest rate hedges for 30% of the loans
obtained. As a result of the liquidity policy implemented
in recent years, available funds amount to nearly 36%
of interest-bearing liabilities, so the exposure to interest
rate risk is considered to be low.
C) CREDIT RISK
The Group’s principal activity is carried out with sales
paid in cash or by debit/credit card, so that the Group
has no material credit risk concentrations. However,
with the increase in sales of the catering business, which
has a significant proportion of credit sales, the Group
has started to monitor its accounts receivable more reg-
ularly in order to:
i) limit the credit granted to customers
ii) analyze the age and recoverability of receivables
iii) analyze the risk profile of customers
