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3.4.2. RISK FACTORS

Operational risks

Accor is not subject to any specific legislation that could have a major impact on its operations. In addition, it is not technically or commercially dependent on any suppliers, subcontractors, customers or other third parties.

However, the Group’s operating presence in a large number of countries exposes it to geopolitical, terrorist, natural disaster, public health and other security risks, although the scale of any consequences arising from such risks is reduced by the fact that the Group’s business activities are by nature widely dispersed around the globe.

a risks relating to geopolitical factors, malicious damage and terrorist threats: In order to effectively safeguard against the main threats identified against Accor establishments, a dedicated organization has been set up and technical documents prepared to define and implement a security strategy that is tailored to the severity of the estimated risks;

a public health risks: Accor continuously monitors any public health risks that could adversely affect its business. In response to the risk of pandemics, annual updated business continuity plans are in place to ensure the health and safety of customers and employees and the continuity of our hotel operations;

a risks relating to business continuity: Other business continuity plans have been prepared at hotel, region, country or head office level for other types of potential risks, such as the risk of a major flood in the Paris area;

a risks of damage to our brand image: Accor could be faced with a major media event capable of damaging its brand image. For example, a health and/or safety incident, a supplier’s practices or accusations of abetting sexual tourism(1) could lead to a smear campaign against the Group. In response, tracking tools have been deployed to detect early warning signs and dedicated crisis management and communication procedures are ready to be activated should an event occur;

a risks relating to informationsystems: Group information systems may be subject to attacks, such as viruses and denialof-service attacks, as well as data theft and technical failures causing system shutdown. The Information Systems Security Department is tasked with securing all of our networks and systems and managing our business continuityapplications.

It also regularly performs intrusion tests on all of our applications assets. In addition, the Internal Audit Department has a team of auditors dedicated to information systems;

a competition risks: Accor faces competition from other hotel groups in deploying its organic and external growth strategies. In particular, information on strategic, business and competition-related issues concerning organic growth and acquisitions is considered to be highly sensitive. In response, measures are in place to raise employee awareness about confidentiality and to enhance the security and access control of our intranet sites;

a employee-related risks: Although management regularly holds constructive talks with employee representatives, both at head office and local level, certain strategies and/or financial decisions could give rise to local disputes or strikes that could adversely affect the business.

Environmental risks

Potential environmental risks in the hotels business mainly concern the storage of gas and fuel oil in or near hotels, the malfunction of transformers containing PCBs (polychlorinated biphenyls), spillage of cleaning products and contamination from cooling towers.

The majority of Accor’s hotels are located in Europe and are subject to EU directives in the following main areas:

a environmental responsibility;

a energy efficiency of buildings;

a waste management, including non-hazardous waste (particularly packaging), electrical and electronic equipment, and hazardous waste (particularly batteries and compact fluorescent light bulbs);

a management of cooling fluids;

a management of chemical substances (compliance with the REACH directive).

In France, certain installations are covered by regulations relating to facilities listed for environmental protection purposes and must therefore be registered in accordance with the relevant procedures.

(1) Employees in countries at risk are trained to detect and prevent cases of sexual tourism involving minors in hotels.