The purpose of country and reputation risk assessments and subsequent mitigation measures is to build a robust  knowledge platform and to understand local conditions and business culture as early as possible in the business process.

This enables StatoilHydro to reduce its country and reputation risk exposure through a process of early identification, prioritisation and mitigation of significant risk elements that could have a potentially negative impact on a given business opportunity. Risk assessments are carried out and updated as part of preparing the decision basis at each decision gate and during the operating and abandonment phases of projects in medium and high-risk countries.

The evaluation of country risk is an integrated part of the decision-making process, with specific requirements and active follow-up from involved management. The risk identification process makes use of Country Risk Workshops where a multi-disciplinary group from relevant parts of the organisation can brainstorm, filter and prioritise risk elements along 18 pre-defined areas of risk and also consider the risk to the company's reputation. In 2008, we conducted 12 country risk workshops, as well as eight country forums on particular risk themes of relevance to different internal stakeholders. 

In addition to this qualitative analysis, projects larger than NOK 500 million in medium-to-high risk countries are assessed for country risk effects on the Net Present Value of the project. Through a model developed with IHS Global Insight, this seeks to estimate which risks have the potentially largest effect on the cash flow of a project and thereby enable mitigation of these risks.