RISK MANAGEMENT FRAMEWORK

ZEEL has a formal risk management process embedded within the business to identify and manage the risks
The industry paradigm is radically changing owing to a dynamic competitive, legislative and financial environment. We have to contend with new business challenges, uncertainties and risks. Our risk management framework provides organizational system for designing, implementing, monitoring, reviewing and improving risk management.

Risk Management Framework

An effective Risk Management process requires consistent identification, prioritization, mitigation, monitoring and communication of risk issues across the full breadth of the organization. Essential to this process is its alignment with corporate direction and objectives, specifically strategic planning and annual budgeting processes.

  • Risk Identification

    • Identify business segments to be covered
    • Establish context – internal & external factors
    • Collate and categorise risks

  • Risk Prioritization

    • Develop a risk rating scale for prioritisation based on potential impact, likelihood of occurrence and effectiveness of internal controls
    • Prioritise risks and identify Risks That Matter (RTMs)

  • Risk Reporting

    • Devise process for status update and reporting to Risk officer/team
    • Periodically update the management and Risk Management Committee

  • Risk Mitigation

    • Assign risk owners to RTMs and prioritised risks
    • Formulate and document the risk mitigation plan

Key Stakeholders for the risk management process

  • Risk Management Committee

    • Sets the tone for the Company towards risk and integrates risk management into the operations
    • Examines and determines the sufficiency of internal processes for reporting and managing risks
    • Defines the role and structure of management in governing risks
    • Ensures that the process for risk management is undertaken periodically

  • Management

    • Discusses, understands and approves risk appetite and tolerance
    • Monitors and reviews the strategy considering organisation's risk profile;
    • Reviews the risk register and agrees on risk categorisation and prioritisation
    • Allocates risk owners, approves the mitigation plan and modifies strategy as needed

  • Risk Owner

    • Implements the risk mitigation plan
    • Reports new risks or failures of existing control measures
    • Determines controls to lower the risk profile of critical processes
    • Educates employees dealing with key activities of the risk management process

ORGANIZATIONAL RISK MAP

Regulatory1 Regulatory uncertainties

Risk Statement

The M&E industry is governed by the rules and regulations framed by the authorities and regulatory bodies of the different countries we operate in. The policies and regulations issued by them have a bearing on the industry landscape as well as business of the Company

Mitigation Plan

As a responsible organization, we proactively engage with all our stakeholders, including the regulators and industry bodies. For the new regulations and any proposed policy changes, we participate in the discussion phase. Our feedback is oriented towards making high quality entertainment accessible to consumers at an affordable cost.

We also engage with the policy makers as a member of IBF(India Broadcasting Federation), which provides research - based inputs and carries out advocacy on various issues concerning the industry

Our annual business planning process incorporates likely changes in regulations and policies.

Strategic2 A faster than expected shift to digital platforms

Risk Statement

With mobile data prices coming down, digital content consumption has grown exponentially. This can lead to a slower growth of advertising revenues for the profitable television business.

Mitigation Plan

As an entertainment content company, the organization is focused on creating content which resonates with the audience irrespective of the platform on which it is watched. The company endeavors that its content is available on all platforms to maximise the audience reach.

The company is investing in digital platform, ZEE5, to make it one of the leading OTT platforms in the country. ZEE5 would allow the company to benefit from growth in digital viewership and ad spends.

Operational3 Failure of the digital platform to attract viewers and revenue

Risk Statement

There are too many digital platforms competing for a small, though growing, digital audience. Since the monetization model for digital platforms has not fully evolved, it could impact the profitability of our digital offering.

Mitigation Plan

The company believes that digital is an opportunity, both for advertising and subscription revenue. With increasing internet penetration, the digital content consumption is set to rise.

The company’s digital platform, ZEE5, was launched with an extensive content catalogue. The investments in ZEE5 will continue to make it the default digital platform for entertainment.

Operational4 Failure to keep content cost inflation under control

Risk Statement

With increasing competition, content creation and content acquisition costs could rise to a level not commensurate to monetization potential and estimated cost recovery

Mitigation Plan

The company has long-standing partnerships with all the major production houses, movie studios and other creative partners which has helped it to keep costs under control.

The company regularly works with new talent which helps control cost. It also exploits content across multiple businesses thereby enhancing revenues

The company extensively evaluates the value of third-party content to ensure that it acquires economically viable content.

Talent5 Failure to hire and retain best talent

Risk Statement

Failure to evolve organization structure and culture could lead to loss of ability to attract, develop and retain key creative, commercial and management talent

Mitigation Plan

The company believes that people are its real asset and it strives to be a great place to work by creating an encouraging working environment, providing career growth opportunities and offering avenues for learning and development.

We constantly assess the structure of the organization to align it for the best functional-fit.

Technology6 Failure to make proper use of technology

Risk Statement

Absence of processes embedded with Big Data technologies and advanced analytics which complement management decision making could restrict the ability to leverage data repositories and tools existing in ecosystem

Mitigation Plan

We continuously review the technology requirements of the organization and upgrade the systems on a regular basis. We partner with the best technology vendors for data analytics and other requirements.

For some of the key functions of our digital platform, we plan to gradually move the teams inhouse to have more control, flexibility and agility