Annual Report 2021

069 Corporate Governance Report Miramar Hotel and Investment Company, Limited Annual Report 2021 Risk Categories Key Risks Key Measures in Risk Mitigations Risk Level (Risk Velocity) Risk Momentum Contractor and Supplier Engagement with problematic supply chain of key products, substandard contractors/ suppliers and food hygiene incidents may cause financial and reputational loss – All vendors are required to go through the well- established pre-qualification mechanism – Closely monitoring of the performance of contractors/ suppliers – Mechanism of picking out and deregistering problematic vendors from the list is in place – Closely monitoring by internal hygiene teams for food safety Low (Rapid to Very Rapid)  Under continuous monitoring procedures supplemented with crisis management mechanism, the risk level remains unchanged Management & Operational Activities Insufficient/ineffective internal controls in daily operations leading to financial loss and reputational damage, e.g. credit risks, contractual risks, abusive use of discount, cash misappropriation, fraud committed in collaboration with external parties, loss/ degradation of physical assets, etc. – Approval authority has been set up and well communicated among all staff – Policies and procedures on key controls have been established and published on intranet – Monitoring procedures, e.g. preparation of aging report/ stocktaking/cash count by Group Finance, are in place – Regular repair and maintenance performed by internal team/contractors – Whistleblowing channel has been set up – Internal Audit conducts independent review on a regular basis Low (Slow)  Under the existing control and monitoring procedures, the risk level remains unchanged