FD FDF W F Webi ebinar nar: : Ri Risk sk Man Manage agemen - - PowerPoint PPT Presentation
Wel elco come me, FD FDF W F Webi ebinar nar: : Ri Risk sk Man Manage agemen ment t an and C d Cov ovid-19 19 - Presented by Global Counsel Wednesday 10 June 2020, 11:00am 12:00pm Se Sessi ssion on On One - Preparing
Wednesday 10 June 2020, 11:00am – 12:00pm
Stephen Adams, Senior Director, Global Counsel
Things risk managers know
Stephen Adams and Elizabeth Beall Global Counsel
Stephen Adams Senior Director Global Counsel Elizabeth Beall Practice Lead Global Counsel
Welcome
PART 1: What covid-19 reminds us about risk PART 2: Lessons from the CO2 crisis PART 3: Anticipating regulatory change Q&A
PART 1 What covid-19 reminds us about risk
What risk managers know
variables
localised change
inventory? Maximised resilience? Efficient systems are not always robust
Covid-19 and policy risk
Policy actions cascade, compound and create the context of their own removal
Covid-19 and policy risk
to the policy ‘playbook’ and from our assumptions about what policymakers will or will not do
Covid-19 and product innovation
Re-shore Simplify/ diversify supply chain Simplify product composition NASA JPL VITAL 700 fewer components than conventional ventilator Hospital ICU ventilator 20+ core elements 100s of subcomponents 50+ countries
Se Session ion Tw Two
specific examples within food and drink supply chains and how to rethink risk in light of Covid19 Elizabeth Beall, Practice Lead, Global Counsel
PART 2 Lessons from the CO2 ‘crisis’
The CO2 problem
13
By-product No easy substitute Small number
Difficult to store Difficult to transport
Risk predictors
Weak substitutability. The product cannot be easily substituted with other substances. Supply and demand disconnect. The product is a by-product of another substance or is heavily reliant on the supply of inputs which are not stimulated by demand for the product. Supplier diversity. There are a small number of producers of the product and therefore it is difficult to find other sources.
transport which make it difficult and/or costly to transport
Storage and inventory. The product has certain characteristics that make either long-term storage or large quantity storage difficult or costly.
Applying this model
Substitute Supply/ demand Supply diversity Difficult transport Difficult storage Glycerine Phosphate Ammonia ADN
Glycerine: applying the risk model
Farmers Primary processors Food distribution system Transport / Packaging Secondary processors Retailers Condiments Dairy products Processed meat Grains
Glycerine: lessons from the model
Glycerine supply chain Supply: 66% of the world’s supply of glycerine comes from biodiesel which is decreasing due to preference for other fuels Demand: 24% is used in food products with demand increasing due to increasing living standards and demand for lower fat, lower sugar, and plant-based diets
PART 3 Anticipating regulatory change
4 3 8 4 18 1990 1995 2000 2005 2010 2015 2018 New regulation on plastic bags
Falling out of love with plastic
Consumer support for change? Broad latent or vocal consumer support for change, backed by evidence of consumer preferences. No legal barriers? No international legal restrictions or
a government is willing to breach these Imperative to act? A major political or practical change that disrupts the status quo and creates an imperative act – policy, political change, natural disaster, global pandemic.
Three key variables for regulatory risk
Applying this model
Consumer support Legal barriers Imperative to act? ‘Sin-taxing’ VAT differentiation SPS controls on EU supply chains Trade dispute escalation
VAT differentiation: applying the model
Consumer support
Open to reducing meat consumption Not
Legal barriers Imperative to act?
+ +
Read the report
https://www.fdf.org.uk/publicgeneral/risks-under-radar-april2020.pdf
Elizabeth Beall e.beall@global-counsel.co.uk Stephen Adams s.adams@global-counsel.co.uk
Contacts