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RISK FACTORS
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LISI 2015 FINANCIAL REPORT
2.2
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STRATEGIC RISKS
These risks are identified as major risks likely to compromise
durably the completion of the strategic plan as described
in paragraph 1.1. All identified risks which are classified in
the "HIGH RISK" category of occurrence are the subject of
insurance coverage (cf. paragraph 3) or of a corrective action
plan and are treated as a priority by the managements of the
various divisions.
2.3
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ENVIRONMENTAL RISKS
The LISI Group is committed to protecting the environment
while manufacturing its products. Any negative impact
resulting from its activities is minimal, and specific attention
is paid to water, energy and waste management.
Its industrial and environmental policy aims to manage its
major risks, which are:
■■
the risk of fire and its potential impact on affected sites or
their environment;
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the risk of soil or water table pollution.
This risk management policy involves:
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the ongoing improvement of the fire protection of the sites,
which are subject to annual monitoring and visits;
■■
investment in protection, with the installation of sprinkler
systems or upgrading of existing systems;
■■
pollution risk prevention: the Group is implementing an
appropriate prevention policy.
As part of the manufacturing sites’ compliance program, and
in the absence of any ongoing legal disputes, the Group has
made provisions for an overall sum of €12 million. To prevent
soil pollution on old sites, monitoring activities are carried
out in concert with the local authorities, on the one hand, and
implementing retrofitting work, on the other hand.
A provision of €4.6 million has been recorded for the assessed
cost of decontaminating the Torrance site (California – USA)
which suffered TCE (solvent) pollution several years ago
(before 1975). The process that is currently in progress involves
pumping and filtering underground water downstream from
the site. This treatment has been used to treat more than 40.8
tons of solvents (TCE equivalents). The estimated amount
at December 31, 2015 facilitates handling of treatment in
accordance with the techniques recommended by our advisors.
Liaison with the authorities has led to the swift closure of the
soils file and to the acceptance of measures taken with regard
to the deepest waters.
An amount of €1.2 million was recorded for the retrofitting of
industrial facilities of the Manoir Aerospace group.
Furthermore, provisions for soil and buildings remediation
were recorded on the French sites of LISI AEROSPACE
(€4.0 million) and LISI AUTOMOTIVE (€2.2 million).
As part of the Social and Environmental Responsibilities
requirements, LISI AUTOMOTIVE undertakes to reduce the
impact of its activities on the environment and to ensure
healthy, safe working conditions for all its employees and
service providers, as part of the Global Compact. Commitment
No. 7 states that "businesses are encouraged to apply
the precautionary approach to environmental challenges".
Commitment No. 8 plans to undertake "initiatives to promote
greater environmental responsibility".
Finally, Commitment No. 9 promotes "the development and
dissemination of environmentally friendly technologies". To
comply with this commitment, LISI AUTOMOTIVE has set
up three specific measures: standardization of practices and
defining of indicators, risk management organized around
the COSO benchmark and implementation of action plans for
environmental safety.
The environmental preventive measures are described in
Chapter 6, paragraphs 2 and 4.
2.4
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LEGAL RISKS
The Group is involved in a limited number of legal proceedings
with third parties (not customers). All these disputes have
been reviewed with our Auditors and the most significant were
appreciated by the Audit Committee. Generally speaking, all
legal positions are determined and reviewed by third-party and
in-house specialists.
Except for the disputes referred to above, for a period covering at
least the last 12 months, no governmental, legal, or arbitration
proceedings (including any proceedings of which the Group is
aware, which is pending or of which it is threatened) are to be
reported that may have or have recently had significant effects
on the Group's financial situation or profitability. The amount
of provisions for legal risks found at December 31, 2015 is not
material.
2.5
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IT-RELATED RISKS
For each of its divisions, the Group has identified an IT
safeguard action plan likely to be implemented in the event
of a serious failure. In addition, the Group has insured risks of
interruptions and malfunctions, or forced use, of its IT systems
with a specific policy.