Risk Management

Our risk management criteria:

Below is a summary table that categorizes the main risks related to Berkeley Commerce’s activities and the various factors and measures mitigating their potential negative impact through the implementation of risk mapping and a schematic representation of the identified risks, assessments and control processes. The section ends with a detailed description of the internal control and risk management system’s formalization.

Main risks	Risk Factors	Mitigants
Exogenous Risks associated with shifts in external factors such as economic, political, or legislative change	Changes in financial markets, notably with regards to the volatility of share price and interest and foreign exchange rates Changes in macroeconomic variables (growth rates, monetary policy, inflation, commodity prices, etc.) Regulatory or budgetary policy changes involving, for example, tax reform or new legal obligations Specific developments affecting certain geographic areas (US markets, emerging countries, etc.)	Geographic and sector diversification of the portfolio with differentiated cyclical exposure Ongoing legislative monitoring Systematic monitoring and analysis of the macroeconomic scenario, markets, and investment thesis
Strategy Risks resulting from the definition, implementation, and continuation of the group’s guidelines and strategic developments	Differing visions or understanding of the assessment of strategic priorities and inherent risks The validity of the parameters underlying the investment thesis Geographic or sector concentration of investments	Formal decision-making process involving all governance bodies and the management Ongoing monitoring of key performance indicators and regular updates of assumptions and forecasts Periodic portfolio review at different hierarchical levels Portfolio diversification
Cash, equivalents, financial instruments, and financing Risks associated with the management of cash and cash equivalents, financial instruments, and financing	Access to liquidity Debt leverage and maturity profile Quality of counterparties The relevance of forecasts or expectations Interest rate exposure Developments in financial markets The volatility of derivative instruments	Rigorous and systematic analysis of considered transactions Definition of trading limits Diversification of investment types and counterparties The strict counterpart selection process Monitoring of the liquidity profile and limitation of net indebtedness Formal delegations of authority with the aim to achieve appropriate segregation of duties Systematic reconciliation of cash data and the accounting
Operations Risks resulting from inadequacies or failures in internal procedures, staff management, or systems in place. Risk of non-compliance with quality standards, contractual and legal provisions, and ethical norms	The complexity of the regulatory environment Adequacy of systems and procedures Exposure to fraud and litigation Retention and development of employees’ skills	Internal procedures and control activities regularly reviewed Implementation of delegations of authority to ensure appropriate segregation of duties Maintenance of and investments in IT systems Hiring, retention, and training of qualified staff Internal Code of Conduct and Corporate Governance Charter

Identification, assessment, and control of risks at Berkeley Commerce Inc.

Identifying and validating the list of risks >>

Assessing the risks >>

Responding to risks and putting in place control procedure ˃˃

Verifying and controlling risks

Desk research

Update of the list of risks

Internal meeting

List

Validation

Workshops with Berkeley Commerce’s key people

Risk appetite

Definition of assessment scales

Assessment workshop

Risk mapping

Accepting / mitigating / rejecting / transferring risks

Implementing / adopting / testing control activities

Directors

Audit Committee

Verification of control systems

Whistleblowing procedures

Assessment of applicable risks and their level of control

Specific risks related to the participants

Berkeley Commerce indirectly faces specific risks related to the companies which are identified and addressed by the companies themselves within the framework of their own internal control. The analysis conducted by these companies in terms of risk identification and internal control is described in the reference documents available on their website.