▶️Risk Management
WPG Holdings promotes integrated risk management. The risk management units at each level include risk management in the operational processes through systematical risk identification, risk assessment, risk response, and monitoring considering the enterprise holistically to reach the goal of organizational integrated management. WPG Holdings aims to maximize the quality and quantity of revenue under an acceptable risk level and thus optimizes resource utilization. Internal training is also continuously conducted to ensure employee awareness and to establish a risk awareness culture within the organization.
Since the establishment of the Risk management department in 2017, WPG Holdings continued to monitor the risks identified at each level and the relevant Key Risk Indicators (KRIs), while continuously promoting and strengthening employee awareness of risk management. In addition to risk management education and training for all employees, fire prevention, emergency response, and personnel safety reporting mechanism drills are also held for major offices and logistics warehouses in various regions.
Organizational Structure of Risk Management
WPG Holdings' highest decision-making body for risk management is the Risk Management Steering Team, which is composed of the CEOs of the four major sub-groups and the CEO of WPG Holdings. Among them, the CEO of WPG Holdings is the convener of the decisionmaking team, and directly reports decisions to the Board of Directors.
The WPG Holdings Risk Management Service Unit regularly compiles the risk management results and reports them to the Audit Committee. The WPG Holdings Risk Management Service Unit compiles the annual risk management performance and reports it to the Board of Directors every year.
Risk Management Process
WPG Holdings completed the first risk identification in 2017, continues to supervise and manage existing risks annually, and reports to the CEO of the Holding Company monthly to review the risk management performance. In addition, the company identifies the emerging risks and key risks given the changes in the industrial environment and international situation. The risk management process of WPG Holdings (as shown in the figure below) includes Risk Identification, Risk Measurement, Risk Response, Monitoring and Review, as well as Report Communication and Consultation; this management structure follows the management spirit of PDCA (Plan, Do, Check, Act), and the identification of emerging risks has been integrated into the risk management.
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Risk Identication
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Risk Evaluation
The risk evaluation is executed by the functional supervisors of WPG Holdings to conduct risk identification and evaluation, sort and identify the impact and vulnerability. Finally, the key risks are identified according to the risk score. Each corresponding unit responds to, executes, and follows up with the action plans for the key risks. The Risk Management Service Department monitors, tracks, and reports monthly.
- Identification of Key Risks and Risk Control Measures in 2024
Currently, the WPG Risk Management Service Unit conducts regular management of key risk indicators including confidential data management risk and critical outsourced vendor business suspension risk (IT), In-house warehouses and outsourced warehouses BCM, office BCM, and information security risk management, and establishes a monitoring indicator mechanism and risk response tracking management reports.
Based on the results of the risk identification impact and vulnerability assessment, the key risks were identified as follows :
- Risk Monitoring
Each functional unit shall monitor related risks and formulate corresponding control measures.
- Risk Response and Tracking
WPG Holdings Risk Management Service conducts monthly followup management of key risk response strategies and reports to the convener of the Risk Management Steering Team.
Risk Management Project
In 2024, the WPG Risk Management Service Unit focused on the Group’s major development strategies and the continuous major emerging risks during business operations. The main aspects include “establishing a quantitative risk assessment mechanism,” “establishing a risk early warning and notification mechanism,” and “outsourcing smart warehousing risk management and continuous tracking.”
- Establishment of Quantitative Risk Assessment Mechanism - Management of Key Risk Indicators
WPG has set up the key risk indicator (KRI) for the corporate risk management system since 2017. Since 2018, WPG has conducted relevant operations of the KRI mechanism, set up key risk indicators, and identified responsive measures for risk thresholds. Through the establishment of a “red and yellow light” risk threshold and countermeasures management mechanism, the Risk Management Service Unit of WPG Holdings regularly tracks KRI indicators to understand whether any risk items require special attention and regularly reports to the Risk Management Steering Team of WPG Holdings, enabling corporate management to determine the focus of risk indicators within the organization, as well as to establish a risk alert system to identify the precursors and root causes of key risks within the organization.
- Establish Risk Early Warning and Notification Mechanism
In the event of an incident of the following nature, the discovering staff or the notified supervisor shall immediately notify the risk management unit regardless of office hours. In case of any questions about the incident notification process, personnel should consult with next-level supervisors as a matter of priority.
- Risk Management Continuously Tracked
In line with the PDCA (Plan, Do, Check, Act) management philosophy, we continuously optimize risk management and enhance the company's risk resilience.
- Emerging Risk Management
With the increase in the number of global emerging risk types and the probability of occurrence, WPG Holdings also includes identifying and managing emerging risks in the risk management process. WPG Holdings’ identification and assessment of emerging risks in 2024 were mainly focused on “Geopolitical Risk Management.”
- Geopolitical Risk Management
In 2024, geopolitical risk education and training will be conducted for the logistics team and subsidiary risk management teams regarding geopolitical conflicts and wars.