failure on the value chain by operating production lines in-
dependently from one another. It is compulsory for our staff
to receive training in the clearly defined process and quality
standards in the areas in question. In addition, we conclude
property damage as well as plant and equipment breakdown
insurances. Due to capacity utilization stretched to the
limits, both the probability of occurrence and the amount
of loss in the production risk group have increased compared
to the previous year, resulting in an upgrade from low to
medium in this risk class as well.
Information technologies form the basis of nearly all
of ALTANA’s business and communications processes. Breakdowns
or other disruptions of IT systems can lead to far-
reaching impairments in all of the Group’s value-added stages,
which can have significant effects on business perfor-
mance (IT risks). In addition, potential risks arise from data
loss or theft of business secrets. ALTANA attaches great
importance to smooth availability of IT applications and services.
To guarantee this, corresponding processes and
organizational structures have been established. Emergency
plans are in place in case of significant disruptions or losses
of data. Due to the increased risk of cyberattacks and the
resulting potential damage to internal processes and deliv-
ery capability, the group of IT risks has been rated higher in
terms of both probability of occurrence and amount of
damage, so that these are now reported as a medium risk. In
the past fiscal year, in view of the increased risk profile,
we significantly increased spending to expand security and
protective measures against cyberattacks. We will continue
this level of security and these protective measures in the coming
years and regularly adjust them to the threat profile.
Delivery of faulty products can cause damage to people,
property, or the environment and thus cause liability risks.
This can have significant effects on the Group’s asset situation.
We minimize this risk by standardizing production pro-
cesses to a large extent and by taking comprehensive quality-
control measures. In addition, we continually conduct
analyses to assess the hazardous potential of our input materials
and products, and we conclude insurances.
Changes in political and regulatory framework conditions
can lead to restrictions on trade or foreign-exchange
transactions. Due to political unrest, it can be more difficult
or even impossible to access the Group’s assets in the
country or countries in question. On account of regulatory
adjustments, it might no longer be possible to process or
sell certain products or ingredients, or only with strong restrictions.
We continually examine the political environment
in the countries important for us and take current tendencies
into account when evaluating business relationships. We
only make direct investments in countries in which we assume
the political environment is highly stable. We actively take
part in legislative procedures and discussions important for
us that focus on changes in the regulatory environment.
As a result, we can anticipate possible new requirements
In the past fiscal year, both the probability of occurrence
and the damage values in the group of political and regulatory
risks decreased slightly, so this group was reclassified
from medium to low.
Although the intensity of the pandemic varies from
region to region and at different times, it is still ongoing. As
a result, supply chains and logistics processes may be adversely
affected, making it more difficult to sell products and
having a negative influence on manufacturing costs. Thus,
there is still the risk of economic damage resulting from the
coronavirus pandemic. The further course of the pandemic
may have an impact on the economic development of all of
ALTANA’s sales markets. The possible financial effects have
been taken into account in the planning figures and scenario
analyses based on them for the year 2022.
The United Kingdom left the European Union on January
31, 2020, with an exit agreement. The necessary
82 Expected Developments