COURSE: ENTERPRISE RISK MANAGEMENT

PROJECT: STORA ENSO

Instructions for the submission:

● Please maintain the following: Font - Times New Roman, Font Size - 12, Line Spacing
- 1.5

S.No. Assessment Submission Marks

Format

1 Understanding risk Sora Enso Text 14 marks

(Questions 1 to 4)

2 Stora Enso risk analysis Text + Excel 56 marks

(Questions 5 to 12)

Project Maximum Marks 70 marks

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Question 1. Identification of four risks faced by Sora Enso

4 risks faced by Stora Enso

1. Geopolitical and Regulatory Charges: Changes in regulations for
pulp and wood processing and excessive deforestation with
different laws in each country.
2. Pandemic and Covid-19: With the onset of covid-19 and
disruption in supply chain management, most of the businesses
were closed causing a downfall in manufacturing processes.
3. Operational and supply chain vulnerabilities: With operations in
more than 35 countries, there are risks associated with sourcing,
production and transportation issues.
4. Technological advancement and changing trends: With increase
digitization and increase in production of biodegradable plastic is
a threat to paper and paper packaging industry.

Question 2. Classification of the four risks being faced by Sora Enso

RISK IDENTIFIED DOMAIN

Geo-political and regulatory Regulatory/compliance risk

changes

Pandemic and Covid-19 External/Natural risk

Operational and supply chain Operational risk

vulnerabilities

Technological advancement and Strategic risk

changing trends

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Question 3. Identification of Stora Enso’s maturity stage and its reasoning

Risk maturity: Stage 3 Optimized ERM

1. ERM process is closely aligned with the group’s strategy to
ensure holistic systematic and proactive management of risks and
opportunities and risks, as well as well-defined mitigation
process.
2. To coordinate risk management, an enternal ERM team has been
formed. The division risk managers and Senior Vice President,
ERM are a part of the ERM group.
3. Automated assessment and risk interaction across the company
by taking steps to integrate sustainability and ERM.
4. Risk management process followed by Stora Enso are:
1. Key definitions
2. Objective setting
3. Risk modelling
4. Risk classification
5. Identification and evaluation including risk assessment
6. Calculation of residual risk
7. Report requirements and templates
8. Determination of risk appetite

Question 4. Suitable risk management framework and its justification

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Suitable risk management framework for Stora Enso ISO 31000
1. It’s a standard framework applied by different corporations
across the world, and as Stora Enso is present in 35+
countries it’s more viable to apply a common framework
2. Stora Enso’s ERM focuses on attaining group objective by
incorporating a well-defined strategy to mitigate risks.
3. The top management set the key definitions and objectives to
define risks and opportunities. Thus it follows a process that
involves and engages various stake-holders and divisions in
the organization to find, analyze, mitigate and monitor
different risks.

Question 5. Plotting of risks in the heat map (in the template excel file)

Please attach a screenshot of the "Likelihood - impact table" sheet of the

template

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Question 6. Calculation of risk scores

Please attach a screenshot of the "Risk register" sheet of the template

Question 7. Identification of the drivers for the risks

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Please attach a screenshot of the "Risk register" sheet of the template

Question 8. Identification of the risk owners

Please attach a screenshot of the "Risk register" sheet of the template

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Question 9. Prioritization of the risks and justification for the order

PRIORIT RISK JUSTIFICATION

Y LEVEL

P1 Risk 3: It has the highest impact, and the

Declining sales likelihood is high. It disrupts the
business to a large extent and affects
production thus affecting profitability.
In case of pandemic the management
has very little control over the external
factors

P2 Risk 2: Use of It has a high likelihood of occurrence, it

old technology has a high impact in terms of increased
production cost and lower output, and
high labor cost.

P3 Risk 4: New It has instant affect and compulsory,

Regulation with inability to comply can lead to
legal implications.

P4 Risk 1: Data The chances of data hacking is low and

hacking can be reduced with advance security
feathers but the impact can be high,
leading data loss and reputational
damage

P5 Risk 5: It has low velocity which gives time to

Consumers prepare for the risk, also the impact and
preferring likelihood of occurrence is low as
biodegradable compared to other risks
plastic
packaging

Question 10. Four aggravating factors for the forest produce industry creating an impact
on their revenue generation

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Please attach a screenshot of the "Risk register" sheet of the template

Question 11. Four mitigation strategies to reduce the risk posed by the aggravating
factors

Please attach a screenshot of the "Risk register" sheet of the template

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Question 12. Risks that should be accepted with their justification

Risk 3: Declining Sales

Risk 2: Use of old technology
As both the risk carries a significant impact (in terms of financial losses)
hence the benefits would be greater than the mitigation cost if the
projects are successful.

While for other risk the mitigation cost would we higher than the
monetary outcome.

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