| Risk | Risk definition | Risk mitigating actions |
Strategic risks | | |
Change in media consumption | Industry transformation following trends in media consumption and technological development. The capacity of product and service development to assess changes in consumer behaviour or invest in the appropriate technological service solutions. | Business development driven by customer needs. Measures to promote digital business competitiveness. Ensuring that content is interesting. Developing the user interfaces of media as well as purchasing paths and payment systems, for example. Sufficient investments and resources in research and development. |
Change in the competitive landscape | Expansion of international platforms, industry convergence, reduced price competitiveness. Technological solutions and implementations by platform providers that restrict the operations of other companies. | Service business development, active development of the existing business, diversification of revenue sources, geographic diversification of business. |
Printed and digital media audiences | A significant drop in print subscribers and readers, a drop in online service subscribers and users, a permanent decline in advertising sales and a significant increase in distribution and delivery costs and pressure concerning the pricing of services. | Maintaining and developing an interactive media-reader relationship, customer satisfaction surveys, Alma Media’s internal cooperation in content production, content sales, advertising sales, support functions and product development. Distribution partnerships and cooperation with publishers. |
Customer data | The ability to utilise the growing amount of customer data in delivering better and more targeted service solutions. The capacity of product and service development to anticipate changes in customer needs. Violations of the GDPR or other regulations governing data protection. Data protection violations arising from the management of complex technological systems or inadequate employee competence. | Business development driven by customer needs. Measures to promote digital business competitiveness and data management. Sufficient investments and resources in data management and systems as well as the development of data protection procedures and employee competence. |
Fluctuating economic cycles | Advertising represents a significant share of revenue and is sensitive to general economic cycles. | Continuous analysis and monitoring of the operating environment, preparedness to implement structural changes as necessary. |
Changes in legislation | Interpretations by the authorities regarding the practical application of the GDPR, the upcoming ePrivacy Regulation and potential legislative changes concerning taxation. | Internal training, monitoring legislation and the regulatory interpretations of the authorities, building processes for legally required changes in the organisation. |
Country-specific risks | Business operations involve country-specific risks relating to market development and economic growth. Geographic diversification and internationalisation help reduce the country-specific risk of the domestic market. | Ongoing market development analysis, monitoring and analysing Group- and country-specific risks. |
Group subscriptions of magazines | Changes in the group subscriptions of the major financial and technology-related magazines. | Customer satisfaction surveys and continuous service development based on the results, in cooperation with group subscribers. |
Operational risks | | |
Disturbances of information technology and communications | Reliability of information networks. | Contingency plans, decentralised server solutions, cloud computing, ensuring sufficient competencies. |
Cyber risks | The risk of being targeted by information security attacks and data theft. | Contingency plans and risk management actions, ensuring sufficient competencies, insurance. |
Competence | Technological development and the demands of new technology increase the risk of obtaining and maintaining sufficient competencies and achieving employee commitment. | HR strategy, creating commitment in key individuals, additional resource allocation and trainee programmes, employee well-being. |
Financial risks | | |
Interest and foreign exchange risks | A change in an interest rate or currency exchange rate causes a significant impact on the company’s profit or balance sheet position. | Treasury policy and the hedging principles defined therein. |
Refinancing risk | The company is unable to renew maturing financing agreements. | Treasury policy, financing plan and agreements, sufficiently long maturity of loans, sufficient equity ratio. |
Liquidity risk | The company is unable to cover its maturing obligations in the short term. | Treasury policy, financing limit agreements of sufficient size. |
