Burberry It Is My Opinion That Burberry Essay

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Burberry It is my opinion that Burberry does not meet the spirit of Section C. The company highlights the risks that it faces on pp.54-56 in the 2011 Annual Report. The company presents, however, only generic risks. Twelve risks are highlighted in total, including the loss of key management team members, IT issues, global catastrophes, risk associated with emerging markets, ethics, regulatory compliance, supply chain issues (twice), licensed business risk, economic downturn and unauthorized trademark use.

The problem with Burberry's discussion of these risks is that it is shallow. The company describes the impact, but in a superficial fashion. For example, economic downturn could "lead to a reduction in demand" and failure to adhere to ethical standards could result in "penalties, adverse press coverage, and reputational damage." There is basically nothing in these statements that provides any insight. The investor is already...

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should highlight risks in a clearer manner, and should highlight more risks. The investor should be aware of precisely how the risks will affect the company, and the degree to which the company is exposed to these risks. In addition, there is very little discussion of financial risks. For example, the company should outline under Section C. how it intends to ensure that accounting is done in accordance with IFRS. The company should also outline, for example, how it intends to manager its foreign exchange rate risk.
The company does outline some of the risk minimization strategies that it has. For example, Burberry conducts audits on its suppliers, including visits, to ensure that they are adhering to the company's code of conduct. However, such information is thin in this annual report, and there is no…

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References:

Burberry 2011 Annual Report. Retrieved April 4, 2012 from http://201011.annualreport.burberry.com/projet/multimedia/files/Full_annual_report.pdf


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