Carillion plc uses a formalised process for risk assessment on projects that are considered high risk (against defined criteria). The main high level categories used include:

• high monetary value and funding matters (thresholds vary with business group);
• high technical innovation and expertise;
• location (countries have been classified by risk on political and economic factors);
• client/other parties involved;
• environment and socio-economic factors;and
• contractual and commercial matters.

For long term projects Carillion considers the whole life cycle risk including operation and maintenance as well as construction project risks.

To operate in countries outside of our existing areas of operation, internal procedures require country clearance to be given before any project can be tendered. The country clearance process includes risk assessments of the prevailing political, social and economic conditions. The safety and security of expatriate and local staff are critical issues in such risk assessments.

Risk is also assessed corporately. The risk profile across the whole of Carillion’s business has been evaluated based on the business risk of each business group sector. One off risk assessment is also undertaken for disposals and acquisitions.