Strategic Report


Corporate Governance


Financial Statements


Finsbury Food Group Annual Report and Accounts 2020


31


02 Brexit


Movement in year


Principle Risk The risk of a no-deal Brexit is financially material. WTO tariffs will adversely affect the cost of inbound raw materials. There will also be tariffs on exported finished goods, primarily to our French subsidiary, Lightbody Europe.


The impact is likely to be inflationary and will affect all customers and competitors alike. The consequential risk is to volume loss or decline.


Mitigation Since the referendum in 2016 the Company has decreased the amount of raw material imported from Europe and continues to work with suppliers in this regard.


Capital investment has been targeted at automation and operational efficiency.


Investment in new bakery in Poland to expand capacity for continental Europe.


03 Cyber Security


Movement in year


Principle Risk The exposure to random and malicious attacks from Cyber criminals always exists. Protecting key information assets is of critical importance.


Mitigation The Audit Committee has reviewed in depth the cyber risks and mitigating actions which include:


• Maintenance of protections software and real-time back-ups; • Independent penetration testing;


• A new Group-wide information system with standardised protection, operating requirements and security protection;


• In 2020 will migrate to a Cloud-based platform with enhanced protection as standard; and


• Training and regular communications, including warning of common frauds to be aware of.


Commentary Similar to last year – hard Brexit risk and continued uncertainty, but well prepared.


Commentary Increase risk offset by enhanced mitigations.


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