Managment assessment of the risk situation
The current risk situation is assessed on the basis of our RMS. The system is based on the requirements of the KonTraG and is continually evolving. During the year under review, there were no major methodological changes to that system.
As of December 31, 2019 DB Group’s main risks were in the areas of law and contracts as well as production and technology. Compared with the previous year, the overall risk position as of December 31, 2019 in relation to the EBIT forecast for the following year has increased in the year under review.
As a result of the worldwide distribution in the first quarter of 2020 there are also considerable risks from the effects
of the coronavirus, the length and intensity of which are at this time not yet foreseeable.
Opportunities beyond the EBIT forecast exist in the amount of € 0.1 billion (thereof very likely: € 0.0 billion). These opportunities exist primarily in production and technology.
Third-party evaluation is also an important indicator for overall risk assessment. In addition to internal risk assessment, DB Group’s creditworthiness and its aggregated default risk are also assessed by the credit ratings of Moody’s and S&P Their external assessments of DB Group’s overall risk position are reflected in the good ratings. In the sustainability area, potential risks posed by ESG Rating agencies such as ISS ESG and MSCI are assessed and evaluated externally.
In terms of organization, we have created all of the conditions necessary to enable the early identification of possible risks. Our continuous risk management and the active management of key risk categories contribute to limiting risks. Key strategic opportunities and risks were identified at the business unit level and recorded in the course of the Strategic Management Process (SMP) for operationalization with measures. Our analyses of opportunities and risks, countermeasures, hedging and precautionary measures, together with the opinion of the Management Board based on the current risk assessment and our mid-term planning (MTP), indicate that there are no risks that, individually or jointly, could have an impact on the net assets or the financial or profit position of DB Group and would pose a threat to the Group as a going concern.