Governance-related risks

Risk level

Likelihood

Impact

Description

• Regulatory compliance in relation to relevant international and EU laws and other provisions are requisite to avoiding penalty fees and other sanctioning measures. There are several environmental laws and directives, including laws on supply chain, carbon emissions, and other aspects such as trade sanctions that can affect Thule’s financial position.

Counteracting factors and management

• Thule is stringent with observing the policy landscape, in terms of existing or emerging regulations,- compliancy requirements, as well as other relevant laws and provisions that can impact the business, or product requirements. We are equipped with the knowledge and operative skills to navigate and implement regulations and requirements.

Risk level

Likelihood

Impact

Description

• Thule Group’s guidelines on competition legislation can be contravened.
• Thule Group’s strong position in certain product categories and in some markets may entail restrictions on acquisitions and other business decisions.

Counteracting factors and management

• Thule works continuously with training employees in the relevant legislation and regulations.
• Thule conducts continuous internal audits.
• Thule engages expert legal support in cases of uncertainty.

Risk level

Likelihood

Impact

Description

• Thule Group’s business is subject to local laws and regulations in countries where the Group operations are active.
• Violation of local laws and regulations could impede the Group’s investments and result in increased costs.

Counteracting factors and management

• Thule’s Code of Conduct is comprehensive and regulates local behavior. At the same time, Thule Group also implements various preventive measures to further reduce the risk of regulatory non-compliance.

Risk level

Likelihood

Impact

Description

• Disruption or failures in critical IT systems can directly impact production, logistics and our own online sales (DTC) for example, thereafter, leading to the risk of shortcomings relating to the delivery of products or information to customers and other stakeholders Shortcomings pertaining to data protection can also lead to business-critical data becoming accessible to unauthorized parties.
• External breaches of the Group’s IT environment entail increased risk of data loss, fraud and other irregularities.

Counteracting factors and management

• The company has a structured Group-wide responsibility for IT security. The work follows a well-defined process for IT governance.
• Thule Group continuously endeavors to keep the systems well protected and also invests in recovery plans, data storage functions, IT security expertise and employee training in information security with the aim of increasing internal know-how and awareness of the risks posed by increased threats and attacks on the company’s IT infrastructure.
• Thule Group continuously strengthens its technical IT security.
• Continuous reviews and evaluations are conducted of the Group’s systems and system providers as well as of procedures for data and information security.

Risk level

Likelihood

Impact

Description

• As the Juvenile & Pet product category grows, this means increased exposure in a segment with well-established competitors as well as others that are new for Thule Group. This means increased risk of disputes over intellectual property such as patent rights.

Counteracting factors and management

• Thule Group has a department with proven expertise and experience in handling intellectual property such as brands and patents.
  • There are clearly developed routines and processes to evaluate intellectual property risks and leverage opportunities at early stages of and throughout the product development process.

Risk level

Likelihood

Impact

Description

• Operations are pursued in accordance with Thule Group’s interpretation of applicable laws and tax regulations. If these interpretations should prove to be incorrect, they could have an adverse impact Thule Group’s earnings.

Counteracting factors and management

• Thule Group has a clear tax policy that sets out the company’s fundamental approach to and management of considerations in conjunction with tax questions.
• Thule Group has resources in place to ensure continuous assessments in ample time prior to any changes. Requisite provisions to cover any disputes that may arise are made in consultation with experts.

Risk level

Likelihood

Impact

Description

• The confidence of society and the market in Thule Group’s sustainability efforts is a prerequisite for successful operations.
• Deficiencies in sustainability work can have a considerable negative impact on customer relationships in, for example, the automotive or sport and leisure industries.
• A precondition for an investor collective’s investment in a company is often that the company meets their sustainability requirements.

Counteracting factors and management

• General sustainability targets relating to the environment, quality and social responsibility are monitored on a quarterly basis.
• Thule Group pursues comprehensive quality and sustainability initiatives that impose requirements on both our own operations and those conducted by suppliers.
• Thule Group continuously trains employees and suppliers in the Group’s Code of Conduct

Risk level

Likelihood

Impact

Description

• Corruption threatens sustainable economic and social development around the world, particularly in poor regions. Corruption may exist to various extents in some countries and in different sectors of society.
• Thule sells products in 138 countries, and purchases products and components from more than 750 suppliers. This means that we, like many other companies, run a risk of becoming involved in unethical business transactions, fraud and irregularities in areas encompassing sales and procurement processes

   

Counteracting factors and management

• Thule Group applies zero tolerance to unethical business practices. The Group conducts obligatory courses on the Group’s Code of Conduct for employees, suppliers and business partners. In addition, courses are held on the regulatory framework pertaining to anticorruption and other policies. Combined with the framework of internal control and monitoring, this provides the foundation for an ethical business approach and correct financial reporting.
• Thule Group applies global and local authorization manuals in to avoid conflicts of interest.
• Thule Group applies procurement processes that ensure sound business ethics.
• Thule Group provides suppliers with training on the Group’s Code of Conduct, and conducts CSR audits, both in-house and in partnership with the company Intertek, to monitor and audit compliance with the Code of Conduct.

Risk level

Likelihood

Impact

Description

• Responsible and ethical marketing is required to avoid claims of greenwashing, and to ensure transparency and accountability for our operations, business activities, and to provide accurate information related to our products.

Counteracting factors and management

• We use a holistic approach to marketing, whereby sustainability, branding, and responsible communications are integrated to ensure maximum transparency, and provide the right information to our customers.