Risk Management

Navigating risks, augmenting resilience


The Enterprise Risk Management (ERM) framework is closely entrenched across all functions and business divisions of the Company and is effectively being used to make business decisions. More than 100 meetings contributing to ~8,500 man hours of intense discussions bear testimony to the intrinsic nature of ERM’s role within the organisation.

The ERM Committee oversees the Company’s risk management process, control, and their operating effectiveness. Risk response against the identified risks (including emerging risks) are presented before ERM Committee on a half-yearly basis, and guides the ERM coordinator, who works closely with business & functional team for identification, monitoring & execution of agreed risk responses. The evaluation of Risk Maturity level & identification of the emerging business challenges are performed under the guidance of the ERM Council & Leadership Council.


We have mapped our risk and responses to respective capitals. Key responses with respect to top identified risks are as under:

Key risks
Risk response

Geographical & channel concentration

Excessive dependence on a geography or channel with respect to key product categories and customers increases vulnerability to economic events and changing customer preferences.

Capitals at risk:

  • Expanding beyond urban, we now lead rural penetration through:
    • Distributor presence in 3,000 towns (10,000-50,000 population) covering 42,000+ retail points through Rural Vistaar initiative
    • Presence in towns with <10,000 population through 400+ Havells UTSAV exclusive store in FY 2022-23, which is targeted to be increased to 2,000 by FY 2023-24
  • We sell products through multiple channels like MFR/RR, CPC/CSD and e-commerce. Separate teams manage each channel with dedicated focus and follow different models to avoid conflicts.

Technological obsolescence

Inability to timely leveraging technology to meet customer expectation and technological obsolescence may render products outdated.

Capitals at risk:

  • We ensure world-class product innovations powered by leading technology, design and UX (User Experience)
  • We leverage our strategic investments to rapidly innovate consumer-centric products with potential for sizeable revenue contribution
Key product innovations and technology upgrades in FY 2022-23:
  • Havells Studio Meditate Air Purifier
  • Q-Tron MCCB Range
  • Glamtubes and Nimbus downlights
  • Premium BLDC Fans: Stealth Prime BLDC, Stealth Neo BLDC
  • Lloyd ACs with AQI Indicator and on device voice (ODV) features
  • Otto and Orizzonte storage water heater (new form factor)

Brand positioning and impact of digitalisation and social media

Possibility of negative impact on brand image and reputation by some events / social media activities.

Capitals at risk:

  • We have a Digital Command & Control Centre for engaging, addressing grievances, taking feedback and conducting sentiment analysis of customers (both online and offline)
  • Established system for online reputation management that drives positive sentiment among consumers via digital media activities
  • In FY 2022-23, we ran over 25+ digital campaigns

Compliance risk

Risk of non-compliance to laws and regulations and challenges of bad governance.

Capitals at risk:

  • We ensure ‘zero-tolerance’ approach to non-compliance. Compliance status and exceptions (if any) are reported to Senior Management, Audit Committee and Board of Directors. Further, compliance refresh is done semi-annually
  • Consequence Management Grid is prepared to gain insight on true impact of risks
  • Our Internal Audit team (in-house and outsourced) undertake periodical business process review across locations

Protection of intellectual property (IP) rights & counterfeit products

Inability to protect IPs and counterfeit products can lead to opportunity losses and even cost brand reputation.

Capitals at risk:

  • We have a defined mechanism to protect our IPs (trademarks, logos, patents, and product design) which include registering under relevant acts
  • Appropriate civil and criminal actions are taken, both domestically and internationally, for any IP infringements

Material management

Fluctuation in currency, commodity prices and import dependency can impact production and margins.

Capitals at risk:

  • We use average price modelling, linked to LME or related indexes, to purchase key commodities of copper, aluminium, steel, engineering plastics etc. These prices are further benchmarked against current domestic and international market prices
  • We have identified several alternate sources for buying critical parts and raw materials for
  • Import dependency has been reduced to less than ~20% of total sourcing

After sales service

Inability to provide appropriate after sales service can impact reputation.

Capitals at risk:

  • We have an established mechanism to address customer complaints on priority and continually monitor their loyalty-cum-satisfaction index through NPS methodology
  • We ensure superior service quality experiences through use of automation and enhanced technology and having trained service personnel with technical knowledge and soft skills
  • Our service technicians have an overall customer rating of 4.15 out of 5

Supply chain management

An inefficient supply chain management can lead to supply disruption and inventory obsolescence.

Capitals at risk:

  • We ensure efficient supply chain management through:
    • Calenderising recurring and planned events with proactive actions
    • Having integrated and flexible network to meet business requirements
    • Rationalising SKUs to optimise inventory level
    • Adopting new-age technology for sustainable systematic efficiency

Quality assurance

Poor quality and performance of products can impact brand perception.

Capitals at risk:

  • We have matured mechanism for Quality Maturity Progression through well-defined organisation, metrics and score cards
  • Use of well-documented process, system and IT integration ensure better control on production
  • We have undertaken strategic initiative to drive customer-centric quality including: trade & distribution quality, customer experience labs and built-in-quality
  • High level of people and supplier engagement through various initiatives

Information & cyber security

Risks relating to inability in protecting data, ensuring security (of endpoint, network & application, perimeter & cloud security) and having in place measures for business continuity, disaster management and GRC. This may impact ongoing operations and also lead to litigations.

Capitals at risk:

  • Our IT function is ISO 27001:2013 accredited and is enabled through welldefined Information Security Management System policies and governance structure
  • A ZERO Trust architecture has been adopted to enhance security and ensure protection from emerging threats, including through deployment of next-gen SIEM, Firewall, EDR/XDR & SASE Framework as well as DLP (end point, web & cloud applications) and advanced email threat protection
  • Unauthorised access is presented through practices like privilege identity & access management, multi-factor authentication for critical apps (Email, Teams, OneDrive) and role-based access rights
  • A robust cyber resilience is ensured through:
    • Business continuity plan and data centre/disaster recovery mechanism for business applications
    • Digital risk protection and brand reputation management
    • VAPT, cyber threat intelligence and training
    • Organisation-wide phishing mock drill

Environmental, Social & Governance (ESG)

Risk relating environment, social & governance can impact our sustainability, reputation and financial performance. Governance issues like corruptions can impact reputation and lead to regulatory sanctions.

Capitals at risk:

We are committed to reduce our absolute energy consumption, CO2 emissions, water consumption, impact on biodiversity besides adopting clean energy, recycling of water, recycling of waste, EPR implementation & working towards increasing biodiversity by trees plantation.

  • Transition from High Speed Diesel to Piped Natural Gas (PNG) in Haridwar Fan factory which will offset ~ 550 MT of CO2
  • Over 18 lakhs trees planted till date which will sequester ~ 4.3 lacs tonnes of CO2
  • 40+ Energy Saving Projects undertaken
  • 9,470 MWh Total Renewable Energy Generated
  • Our all plants are ISO 9001, ISO 14001, ISO 45001 & ISO 50001 Certified