Risk management
Statoil manages risk to ensure safe operations and to achieve corporate objectives in compliance with prevailing requirements. The overall risk management approach includes continuous assessment and management of risk in all activities.
The company has a separate corporate risk committee which is chaired by the chief financial officer. The committee meets eight to ten times a year to consider and adopt the company's strategies for risk management. A thorough report on the company's risk management is presented in chapter six in the annual report on Form 20-F.
In Statoil, risk management is divided into three main categories:
- Strategic risks that are long-term market risks, and which are monitored by the company's corporate risk committee. The corporate risk committee gives advice and makes recommendations to the corporate executive committee based on strategic market risk policies.
- Tactical risks, which are short-term trading risks based on underlying exposures, are managed by the principle business segment line managers.
- Operational risks, which cover all major operational goals and underlying risk drivers, are managed as an integral part of line managers' resposibilities at all levels. In addition, insurable risks are handled by the captive insurance company operating in the Norwegian and international insurance markets.
Furthermore, Statoil has started implementation of business continuity management as a new risk handling strategy.
The management's report on internal control of financial reporting
The management of Statoil ASA is responsible for establishing and maintaining adequate internal control of financial reporting. Our internal control of financial reporting is a process designed under the supervision of the chief executive officer and chief financial officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Statoil's financial statements for external reporting purposes in accordance with International Financial Reporting Standards as adopted by the European Union (EU). The accounting policies applied by the group also comply with IFRS as issued by the International Accounting Standards Board (IASB).
The management has assessed the effectiveness of internal control of financial reporting based on the Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, the management has determined that Statoil's internal control of financial reporting as of 31 December 2009 was effective.
Statoil's Ethics Code of Conduct and anti-corruption compliance programme
Our ability to create value is dependent on applying high ethical standards, and we are determined that Statoil shall be known for them. Ethics is treated as an integral part of our business activities. The group requires high ethical standards of everyone who acts on our behalf and will maintain an open dialogue on ethical issues, internally and externally.
Our Ethics Code of Conduct describes Statoil's commitment and requirements in connection with issues of an ethical nature that relate to business practice and personal conduct.
In our business activities, we will comply with applicable laws and regulations and act in an ethical, sustainable and socially responsible manner. Respect for human rights is an integral part of Statoil's values base.
The Ethics Code of Conduct is valid for everyone working for the Statoil group, including the members of the board of directors of Statoil and its subsidiaries. The Ethics Code of Conduct is available at www.statoil.com/ethics. Statoil's Anti-corruption Compliance Programme can also be found on the same webpage. In September 2009, Statoil's then Independent Compliance Consultant, retained by Statoil as part of the settlements with the US authorities in connection with the Horton matter, certified that Statoil "has implemented an anti-corruption compliance program that is appropriately designed and implemented to ensure compliance with the Foreign Corrupt Practises Act."
Business partners are also expected to have ethical standards that are consistent with Statoil's ethical requirements.
Statoil has a dedicated ethics helpline that may be used by employees who want to express concerns or seek advice regarding the legal and ethical conduct of our business.
