The Shannon Airport Group Annual Report and Accounts 2024

Annual Report and Accounts | 2024

RISK AND GOVERNANCE REPORT (CONTINUED)

risk of failure to achieve business objectives and provides only reasonable assurance, but not absolute assurance, against material misstatement or loss. The Board has established an organisational structure with clear operating and reporting procedures, secured the services of appropriately qualified personnel, designed suitable lines of responsibility, put in place appropriate authorisation limits, made arrangements in respect of segregation of duties and delegated the necessary authority for decision making. The Board has put in place an ongoing process for identifying, evaluating and managing the significant risks faced by the Group. Management is responsible for the identification and evaluation of significant business risks and for the design and operation of suitable internal controls. The Board has appointed a Chief Risk Officer. The Audit and Risk Committee, the Safety, Security and Sustainability Committee and the Board receive regular reports from the Chief Risk Officer and management on key risks and how they are managed. The system of internal controls includes the following: • Clearly defined organisational structure, with defined authority limits and reporting mechanisms to higher levels of management and to the Board; • Comprehensive budgeting systems including an annual budget which is subject to approval by the Board. Re-forecasts are performed during the year to track expected results against Budget and presented to the Board; • Comprehensive system of financial reporting including the reporting of cumulative monthly actual results against budget and latest re-forecasts, if applicable. These results are presented to the Board for consideration at each Board meeting. The Board questions significant changes or adverse variances and remedial action is taken where appropriate; • Comprehensive set of policies and procedures relating to financial, operational and compliance controls, including capital expenditure; • Code of ethics that requires senior management and employees to maintain the highest ethical standards in conducting business; • Responsibility by management for internal control over their respective business functions; and • The internal audit function conducts a systematic review of internal financial and non-financial controls. A risk based internal audit programme is developed to determine reviews to be performed.

The primary responsibilities of the Remuneration Committee are to determine the remuneration of the Chief Executive Officer, the pay structures of senior management, to approve voluntary severance schemes and restructuring programmes and to review the on- going appropriateness and relevance of the Group’s remuneration policies and pension schemes and any major structural changes to such policies or schemes. Details of directors’ fees and emoluments including those of the Chief Executive Officer are set out in Note 6 to the financial statements, in accordance with the requirements of the Code. Remuneration of key management is summarised in Note 27 (b) to the financial statements. The Safety, Security and Sustainability Committee (formerly known as the Health, Safety, Security and Environment Committee) has defined terms of reference under which authority is delegated to it by the Board. Alan Donohoe was appointed to the Committee on 14th March 2024. The Committee met four times during the year and attendance at the Committee meetings is set out in the table below: SAFETY, SECURITY AND SUSTAINABILITY COMMITTEE

by the Internal Auditor of the findings of internal audit reviews. The Committee also considered management’s progress in addressing the relevant issues, including the nature, extent and speed of response. The Committee reviewed the remuneration and terms of engagement of EY, the independent statutory auditor. The Committee reviewed the external audit plan and the findings of EY from its audit of the annual financial statements. The Committee took appropriate steps to ensure that an objective and professional relationship was maintained with EY. The Committee considered EY’s independence and objectivity. This included considering a) the nature and extent of the services provided, and fees earned, for external audit and non-audit work carried out by EY and b) ensuring the provision of non-audit services to the Group does not present a conflict of interest. Fees paid to EY for audit services, audit related services and other non-audit services are set out in Note 5 of the financial statements. There were no instances where EY was engaged to provide services which were adjudged to give rise to a conflict of interest. The Committee also monitored EY’s compliance with relevant regulatory, ethical and professional guidance on the rotation of partners, as well as assessing annually its qualifications, expertise, resources and the effectiveness of the audit process. The Chairperson of the Committee reports periodically to the Board on significant issues considered by the Committee which are then considered by the Board. REMUNERATION COMMITTEE The Remuneration Committee has defined terms of reference under which authority is delegated to it by the Board. Tom Kelly serves as the Chairperson of the Remuneration Committee. The Committee met twice during the year and attendance at the Committee meetings is set out in the table below:

ͳ monitoring and reviewing the effectiveness of the Internal Audit programme, ensuring co- ordination between the internal and statutory auditors and ensuring that the Internal Audit function is adequately resourced, and that adequate attention is paid to value for money auditing; and ͳ reviewing the policy by which staff may, in confidence, raise concerns about possible business, financial or other improprieties and ensure that arrangements are in place to investigate such matters. The Committee reviewed the annual financial statements before recommending their approval to the Board. The Committee considered, and discussed with the Chief Executive Officer, the Chief Operations Officer, the Chief Financial Officer, senior management from the finance department and the independent statutory auditor, the appropriateness of the significant accounting policies, estimates and judgements applied in preparing these financial statements, together with presentational and disclosure matters. The Committee has an established risk management framework and considered the processes for identifying, reporting and managing both existing and emerging risks. The Committee received periodic management reports on the risk management framework applied, including management actions to address, mitigate and manage risks on a continuing basis. This complemented regular Board receipt of management reports on emerging risks and significant changes in the business and external environment which affect the risk registers. The Committee reviewed, on behalf of the Board, the effectiveness of the Group’s system of risk management and internal control. Monitoring covered all controls, including financial, operational and compliance controls and risk management processes. The Committee reviewed a risk-based internal audit annual plan, including the resources required, and considered the alignment of internal audit focus with the areas of greatest risk facing the Group. During the year, the Committee considered reports from the Internal Auditor summarising the work planned and undertaken, recommending improvements and describing actions taken by management. The Committee was appraised AUDIT AND RISK COMMITTEE (Continued)

Member

Committee meetings attended

Maximum number of meetings

Stephen Rae

Ambrose Loughlin

Aisling Curtis

Alan Donohoe

The primary responsibilities of the Committee during the year was the oversight of safety, security and sustainability matters for the Group and the oversight of aerodrome safety and security matters at Shannon Airport. The Committee reports to the Board on any significant compliance or other relevant issues, receives incident reports, reviews reports on airside safety, security, health, safety and sustainability issues, monitors the processes in place for training and reviews related communications with the Group. It monitors and reviews the risk registers covering its remit. INTERNAL CONTROL AND RISK MANAGEMENT The Board is responsible for the Group’s system of internal control and for monitoring its effectiveness. The system is designed to manage, rather than eliminate, the

Member

Committee meetings attended

Maximum number of meetings

Tom Kelly

Conal Henry

Stephen Rae