Risk appetite
Risk appetite is the level of residual risk we deem acceptable to achieve our objectives. The risk appetite is set per main risk topic by the Board of Management in close cooperation with the Executive Committee, based on our strategic goals, our business principles, our policies and procedures, and taking into consideration the highly regulated markets we operate in.
The risk profile is compared with PostNL's established risk appetite after each risk management workshop. Where there is a difference between the actual risk level and the risk appetite bandwidth, management is required to initiate an action plan. The risk appetite is discussed with and endorsed by the Audit Committee.
In 2023, we began defining our risk appetite ‘per risk’ instead of ‘per risk type’. When determining this, we have taken into account factors such as geopolitical uncertainties, the tight labour market, and economic rationalisation.
| Risk appetite |
Behaviour towards risk High |
|---|---|
Strategic risksWe aim to deliver on our strategic ambitions and priorities and are willing to accept balanced to considerable risks to achieve this. |
Behaviour towards risk High  |
|
Behaviour towards risk High  |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
Operational risksWe face operational challenges which require an appropriate level of management attention. The overall objective is to avoid risks that could negatively impact our aim to achieve operational effectiveness and efficiencies. |
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
Compliance risksWe strive to be fully compliant with our business principles as well as national and international laws and regulations in relation to the markets in which we operate and we do not accept deviations. |
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
Financial risksOur financial strategy is focused on a solid financial position and creating long-term value for our shareholders. Our aim is to have a leverage ratio of adjusted net debt / EBITDA not exceeding 2.0 and only accept risks that do not threaten this. |
Behaviour towards risk High |
|
Behaviour towards risk High |
|
Behaviour towards risk High |
Low
Sensitivity analysis
PostNL Sensitivity analysis in € million
2022, 2023
| Driver | Change | Impact on | 2022 | 2023 |
|---|---|---|---|---|
| Revenue Parcels | +/- 1% | Revenue | 19 | 20 |
| Revenue Mail in NL | +/- 1% | Revenue | 12 | 12 |
| Total revenue PostNL | +/- 1% | Revenue | 31 | 32 |
| Cost of materials | +/- 1% | Normalised EBIT | 1 | 1 |
| Work contracted out and other external expenses | +/- 1% | Normalised EBIT | 16 | 16 |
| Salaries, pensions and social security contributions | +/- 1% | Normalised EBIT | 11 | 11 |
| Depreciation, amortisation and impairments | +/- 1% | Normalised EBIT | 2 | 2 |
Strategic, operational, compliance, financial and reporting risks could impact our revenue. Therefore, we have analysed the sensitivity of our normalised EBIT for changes in our revenue and different cost items. The table below illustrates the impact a single percentage point change would have in million euros.
The first part of the table highlights sensitivity to a change in revenue development for PostNL as a whole, comprised of the segments Parcels and Mail in the Netherlands. Revenue growth at Parcels is mainly driven by year-on-year e-commerce growth, while revenue development at Mail in the Netherlands is mainly driven by year-on-year substitution of traditional mail to digital communication, partly compensated by price increases.
Given the expected further decline of our mail business and continued growth of e-commerce , we expect that sensitivity for e-commerce revenues will gradually increase in the coming years.
The second part of the table gives the sensitivity on several cost lines. Due to the cost structure of PostNL, the sensitivity for labour costs and work contracted out is substantially higher compared to the sensitivity on depreciation and cost of materials. Given the expected revenue increase, we expect all cost sensitivities to increase in the coming years.