2022 Universal Registration Document

D. Risk factors and management procedures

This chapter details the principal risks to which the VINCI Group’s various activities are exposed as well as changes in the year under review, which are summarised in the table below.

The level of criticality of each of these risks (high, intermediate or moderate) was determined on the basis of its probability of occurrence, the anticipated extent of its adverse impact on the Group and in consideration of risk management procedures already in place so as to show the net impact.

Risks that have increased in relation to the previous year (see the table below) are specifically described in the first section of this chapter. Some macroeconomic trends having emerged in 2021 – material and labour shortages, supply chain disruption and cost inflation as a result of a strong upturn in demand as pandemic lockdown measures were eased – gathered further momentum in 2022. The conflict between Russia and Ukraine beginning in February 2022 caused shock waves in global energy markets, propelling gas and electricity prices to record levels during the year. This energy crisis stoked up inflation, leading to a more rapid tightening of monetary policy by most central banks. Due to this unprecedented wave of tighter monetary policy, interest rates rose sharply.

However, the Group’s finances were not significantly affected by the direct impacts of the Covid-19 crisis in 2022, in contrast to the two previous financial years. In particular, the Group’s airport activities, which had been hit hard by the pandemic, recovered throughout the year as travel restrictions around the world were gradually relaxed, then lifted entirely. This Universal Registration Document therefore no longer includes a specific description of the direct impacts of Covid-19.

Lastly, it should be noted that the direct financial consequences of the conflict between Russia and Ukraine are limited for the Group, since it does not have any material exposure to either country. The Group’s exposure mainly consists of stakes held by VINCI Concessions in several companies in Russia: its 50% stake in the concession company for section 0 of the Moscow–St Petersburg motorway (M11), its 40% stake in the company set up to operate sections 7 and 8 of the same motorway under a public-private partnership, and its 50% stake in a road operations company. The value of these interests was written down to zero at 31 December 2022.

Type of risk		Description	Criticality (*)	Trend
	Operational	2.1.1 Energy and Construction businesses		↗
		ˇBefore the contract is signed	High
		After the contract is signed	ˇ Intermediate
		2.1.1 Concessions business
		ˇ Design phase	Intermediate
		ˇConstruction phase	Intermediate
		ˇ Operating phase	High
		2.1.1 Property development business	Intermediate
		2.1.2 Acquisition and disposal of companies	Intermediate
	Legal	2.2.1 Contractual relationships	High	→
		2.2.2 Legal and regulatory compliance	Intermediate
	Cyber	2.3.1 Cyberattacks	High	↗
		2.3.2 Fraud	Moderate
	Workforce-related and social	2.4.1 Human rights	High	↗
		2.4.2 Health, safety and security of employees and subcontractors	High
		2.4.3 Attracting and retaining talent	Moderate
	Environmental	2.5.1 Physical risks related to climate change	High	→
		2.5.2 Increasing scarcity of resources	Intermediate
		2.5.3 Environmental quality and presence of contaminants	Intermediate
	Ethics	2.6 Business ethics risks	Moderate	→
	Financial and economic	2.7.1 Changes in the economic and tax environment	High	↗
		2.7.2 Financial risks	Intermediate

1. Higher level of criticality for certain risks

Operational risks

• In the Energy and Construction businesses

To protect itself against inflation, the Group has become more selective in terms of new contracts, thus deciding to stop entering into medium- and long-term contracts if they do not include price adjustment clauses, except where specific provisions protect it from the risk of cost inflation or in special circumstances.