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Risk
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Mitigation
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Land
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The inability to source suitable land at satisfactory margins would have a detrimental effect on the Group’s land bank and consequently, its future
success
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- Endeavour to ensure that a land bank with planning permission for at least three years’ construction programme is in place on a rolling basis.
- Thorough pre-purchase due diligence and viability assessments.
- Authorisation of land purchases in line with robust Group procedures.
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Planning
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Delays and the increased complexity of the planning process hampers and slows the Group’s growth prospects.
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- Centralised and Regional Planning Directors provide advice and support to divisions to assist with progressing the planning permission process
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Sales
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Ensuring that the effects of any diminution in the size of the marketplace, the ability of prospective
customers to access credit facilities or the sales prices achieved are managed in such away as to limit any adverse financial or operational effects on the Group’s performance.
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- In consultation with Head Office, local divisional management determines product range and pricing strategy commensurate with regional market conditions.
- Use of sales incentives where appropriate to encourage the selling process, such as part-exchange and Express Mover.
- Use of government-backed schemes to encourage home ownership where appropriate.
- Ensuring that construction rates are managed to ensure stock availability matches sales rates.
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Construction
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Ensuring that appropriately skilled personnel are available and that suitable materials are also available at the right price.
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- Identifying training needs and allocating appropriate resources to training.
- Ensuring systems are in place for engaging, monitoring and controlling work carried out by sub-contractors.
- Ensuring competitive reward systems are in place.
- Ensuring Group purchasing arrangements are in place to secure materials at competitive prices.
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Environment
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Housebuilding has a significant effect on the environment. It is important that the effects of the Group’s developments are, as far as possible, positive rather than negative.
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- It is our objective to ensure that at the conclusion of a development an attractive and sustainable new environment has been created that will continue over time. See our Environmental Policy on this website or page 19 of our Annual Report.
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Health and safety
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It is important to ensure that the Group has adequate systems in place to mitigate, as far as possible, the dangers to people inherent in the construction process
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- The Board considers health and safety issues at each Board meeting.
- Regular visits to sites by senior management (independent of our divisions) and external consultants to monitor health and safety standards and performance against the Group’s health and safety policies and procedures.
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Personnel
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Attracting and retaining the correct personnel is key to the Group’s long-term success. Failure to do so will severely affect the Group’s ability to perform in a highly competitive market.
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- The Group offers competitive salary and benefits packages.
- Divisional training plans are in place.
- Succession planning for key posts.
- 98% of site workers (including sub-contractors) are fully accredited under CSCS.
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Information Technology
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It is vital that the Group has suitable systems in place to ensure that, as far as possible, a smooth flow of information is transmitted throughout the Group and that the risk of system loss is mitigated and supported by appropriate contingency plans.
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- Group-wide systems are in place which are centrally controlled with an outsourced support function in place.
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Asset Protection
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The way in which the Group carries out its operations can have a material effect on the value of its assets.
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- The Group prepares viability assessments on all of its land purchases and construction projects, and keeps these under regular review to protect, wherever possible, the value of its assets.
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Treasury Management
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Ensuring suitable financial resources, at appropriate costs, are in place to meet Group requirements.
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- Central negotiation and control of banking facilities to ensure liquidity and debt levels are appropriate.
- Facilities distributed across various sources.
- Careful management and monitoring of cash forecasts.
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Legal and Regulatory Compliance
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Disadvantageous contractual obligations, regulatory fines or adverse publicity by failing to comply with current laws and regulations or failing to have appropriately worded contracts in place.
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- Central secretariat, human resources and legal functions advise divisions on compliance and ensure policies and procedures are kept up to date to minimise risk of non-compliance. In addition, the Board ensures that adequate insurance cover is maintained to underpin and support the many areas in which the Group is exposed to risk of loss.
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