2.5.1 Physical risks related to climate change
Climate change has made extreme weather events more frequent and more severe, making environmental risks more significant for the Group’s activities. They comprise the following:
- “storms”, a general term that includes weather events causing high winds and precipitation (rain, snow and hail);
- wide variations in temperature (heat or cold waves, drought);
- flooding, from rivers overflowing their banks, run-off from heavy precipitation, or rising sea levels, which can cause landslides and exacerbate erosion;
- rockslides or other ground movements, such as the expansion and contraction of clay, which can affect buildings and infrastructure.
These risks were evaluated on the basis of a RCP 4.5 scenario (a “pessimistic” scenario more likely than not to result in a global temperature rise as high as 3.3°C by the end of the century).
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Risk management procedures |
Possible consequences:
- Damage to installations and equipment
- Deterioration in health and safety conditions for employees
- Financial impact resulting from increased expenses necessary to maintain or repair damaged infrastructure and equipment, operating losses and construction delays
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
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Possible consequences:
- Damage to installations and equipment
- Deterioration in health and safety conditions for employees
- Financial impact resulting from increased expenses necessary to maintain or repair damaged infrastructure and equipment, operating losses and construction delays
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
Risk management procedures
- Prior identification of the risks affecting the specific area and implementation of technical facilities to mitigate extreme weather events (cofferdams, pumps, retention basins, cooling equipment, etc.)
- Establishing a business continuity plan (BCP) for certain concession assets (e.g. airports)
- Emergency procedures, in cooperation with local actors, to respond to extreme weather events (work stoppages for employees due to inclement weather, equipment removal, etc.) and cooperation with local officials to implement appropriate emergency and work resumption measures
- Managing unplanned events with the appropriate insurance company departments
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2.5.2 Increasing scarcity of resources
At the same time that the natural climate balance is changing, certain raw materials (minerals, rare metals, fossil fuels) are becoming more scarce, and regions subject to water stress are expanding. For Group activities that depend on the availability of these resources, the increasing scarcity of these resources has a direct impact on the Group’s ability to obtain the materials it needs for its projects and concessions.
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Risk management procedures |
- Increasing scarcity of resources
- Expansion of areas of water stress
Possible consequences:
- Financial impact resulting from possible increases in the cost of certain materials
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
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- Increasing scarcity of resources
- Expansion of areas of water stress
Possible consequences:
- Financial impact resulting from possible increases in the cost of certain materials
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
Risk management procedures
- Implementing eco-design solutions to reduce the use of certain raw materials and to reuse or recycle material from deconstruction in a circular economy approach
- Identifying project sites in areas of water stress so as to adapt construction and operation methods
- Reducing water consumption and development of solutions to reuse water at certain sites
- Adapting processes
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2.5.3 Environmental quality and presence of contaminants
The risk of working on a degraded or polluted parcel of land is substantial in the urban environment, where past industrial installations may have had a negative impact on soil quality and functions or other aspects of the natural environment. If it is impossible to determine who caused the deterioration, the developer is often responsible for site remediation so as to ensure the durability of the new buildings and infrastructure. Filling in old quarries, decontaminating soil and treating waste are activities that entail significant costs and extend the lead times of certain worksites and development projects. In addition, before recycling or treating materials, it is necessary to check that there are no contaminants, including invasive plant species.
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Risk management procedures |
- Risk of working on a degraded or polluted parcel of land
Possible consequences:
- Financial impact resulting from increased expenses necessary to remediate sites and from construction delays
- Deterioration in health and safety conditions for employees
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
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- Risk of working on a degraded or polluted parcel of land
Possible consequences:
- Financial impact resulting from increased expenses necessary to remediate sites and from construction delays
- Deterioration in health and safety conditions for employees
- Impact on the Group’s image and reputation in the event of deficient quality of service, such as substandard work or missed delivery deadlines
Risk management procedures
- Identifying polluted and degraded land and estimating treatment costs
- Managing unplanned events with the appropriate insurance company departments
- Protecting employees working on land exposed to risks
- Implementing techniques and procedures to decontaminate and reprocess polluted or degraded components
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2.6 Business ethics risks
Group companies work autonomously in an international environment with a multitude of stakeholders who participate in or are impacted by the Group’s operations: project managers and their representatives, concession-granting authorities, regulatory authorities, contractors, architects, design offices, joint contractors, subcontractors, suppliers (including local suppliers of construction materials, concrete, aggregates and water, etc.), service providers (inspectors, transporters, freight forwarders, charterers, insurers, bankers, etc.), local residents, communities, users, etc.
Moreover, the Group’s international expansion, in particular through acquisitions, accentuates the risk of exposure to internal or external fraud, to infringements of the Group’s ethical principles or of regulations, in particular with regard to corruption. If such infringements were committed, VINCI would be subject to fines, exclusion from public contracts, remedial action or contract cancellation. Such infringements could also tarnish the Group’s image or reputation, erode the trust of investors, customers and partners, and reduce its ability to respond to calls for tender.
