Annual Report 2020

068 Corporate Governance Report Annual Report 2020 Miramar Hotel and Investment Company, Limited Risk Categories Key Risks Key Measures in Risk Mitigations Risk Level (Risk Velocity) Risk Momentum Disaster Events Major disaster events, including extreme weather events, terrorist attack and outbreak of contagious diseases such as COVID-19, Avian Flu, SARS, Ebola would impact on our business operations, inflict damage to assets and company reputation, and reduce our earnings – Emergency Procedures, Business Continuity Management and Crisis Management are in place to minimize impact on business operations during disaster events – A series of preventive measures have been adopted during the pandemic – Risk indicators on contagious diseases are closely monitored and preventive measures are carried out to minimize impact from disaster events – Drills on business continuity are conducted on an annual basis to ensure effectiveness – Comprehensive insurance coverages are in place for property assets, business interruption and third-party liabilities Medium to High (Rapid to Very Rapid)  The COVID-19 pandemic brought a devastating impact on the public health and affected the Group’s operations and business performance Tenant and Customer Loss of income due to loss of major tenants, customer dissatisfaction over our products/services, etc. Changes in customer/guest spending and dining propensity, competition from online shopping, and decline in spending on luxury goods and out-dining – Continuously monitor guest feedbacks for further improvement – Enhance marketing and promotion to attract customers – Active engagement with current tenants/guests as part of marketing strategies – Keep continuously updated on market trends and make corresponding revisions to strategy – Increase regular cleaning and disinfection frequencies in our shopping malls and office tower since the outbreak of pandemic – Deploy new disinfection facilities to provide our shoppers and tenants with a clean and safe environment Medium to High (Rapid)  Unfavorable changes in spending and dining habits of customer/guest have directly affected our retail tenants, especially during the pandemic. Also, working from home may become a new normal which may affect our rental business performance. The risk is expected to increase