Analysis of critical risks. Risks and opportunities [GRI 102–15]

Inter RAO prepares a critical risk map each year. The document reflects the results of the critical risk assessment, including a graphical display, a list of critical risks, and the disclosure of information on them. Critical risks are regarded as risks that pose a threat of deviations from the Group’s goals and require priority control and management in order to maintain an acceptable level of risk.

Risks that materialized in 2019
Risk Comments
Manifestation of fraudulent and/or corruption actions Two court convictions were handed down for fraud and corruption offenses in criminal cases previously initiated by the Group’s companies against former Inter RAO employees
Risk of violation of antimonopoly laws The Inter RAO Group paid roughly RUB 15 mln in fines to the Moscow Office of the Federal Antimonopoly Service in 2019 for various violations
Changes in foreign exchange rates The risk impacts the Group’s business plan due to deviations in the actual prevailing foreign exchange rates in which the Group’s income and expenses are denominated versus the forecast rates adopted when preparing the Group’s business plan
Opportunities that materialized in 2019
Risk Comments
Change in electricity prices on the day-ahead market The increase in day-ahead market prices in 2019 had a positive impact on the Group’s business plan
Risks not included in the list of critical risks for 2019 for which opportunities led to an increase in EBITDA or operating cash flow in 2019
Price risk (foreign economic activities) The risk’s positive impact on the Group’s business plan is due to favorable pricing environment on the Nord Pool Spot exchange