Compagnie des Alpes // 2020 Universal Registration Document

2 RISK FACTORS Strategic risks

This methodology, which is essentially based on interviews with the Company’s main executives, aims to analyse the situations and scenarios that may have a medium/long-term impact on the Company’s value and strategy. This dual approach (bottom-up and top-down) thus increases the efficiency of the Company’s risk management process and short/ medium/long-term visibility on its objectives. Through an analysis conducted by the Risk, Insurance and Crisis Management Department, each risk defined in the interviews is assessed in terms of financial, human and intangible impact, as well as the likelihood of its materialisation, and the potential improvement margin with respect to its management. The risks are classed into five categories: strategic, operational, human, regulatory and financial.

Through several risk-ranking workshops with the Executive Committee, a risk priority matrix has been defined, laying down a list of 12 priority risks and thus validating the new risk map (set out below), showing the probability of occurrence of the risks, their impact, and their priority level (1 or 2). The risks related to a pandemic were added in March 2020, bringing the number of priority risks monitored to 13. The Group’s key risks are classed into 4 categories: l strategic risks; l operational risks related to its activities; l human risks; l regulatory and compliance risks.

Risk category Strategic risk Strategic risk Strategic risk Strategic risk

Group risk

Probability

Impact Critical Critical Critical

Priority

Change in leisure consumption habits The current real estate market Impacts of climate change Change in the competitive environment

Possible Possible Possible Possible Possible Possible Frequent

Priority 1 Priority 1 Priority 1 Priority 1 Priority 1 Priority 1 Priority 1 Priority 2 Priority 2 Priority 2 Priority 2 Priority 2 Priority 2

Significant

Operational risks Operational risks

Cyber attack – cyber risk

Highly critical

It system failure

Significant Significant

Human risk Strategic risk

Human resource shortage Epidemic – Major pandemic Security – safety of the sites Bodily injury to customers

Rare

Critical

Operational risks Operational risks

Possible

Highly critical Highly critical Highly critical Highly critical Highly critical

Rare Rare Rare Rare

Human risk

Personnel safety

Regulatory and compliance risks Regulatory and compliance risks

Non-compliance with regulations and LC-BFT

Loss of major public service concession

l with a view to transferring the risk of financial loss to insurance companies, for insurable risks. To monitor these priority risks over several years, several indicators have been defined for each of them.

For each of these key risks, ranked in order of priority and impact, risk management measures have been defined: l with a view to prevention, to attempt to reduce the likelihood of the risk arising; l with a view to protection, to limit the impact on the Group;

2.2 Strategic risks

2.2.1 RISKS RELATED TO CHANGES IN LEISURE CONSUMPTION HABITS The development of winter sports resorts over the past 50-plus years has enabled an ever broader clientele to discover the pleasures of the mountain and skiing. The Group is engaged in promoting and distributing new offers to customers.

subsidiary Travelfactory, providing better control of distribution channels. Furthermore, Compagnie des Alpes offers a variety of non- ski activities, thus broadening the range of leisure activities offered to customers. In addition, Compagnie des Alpes is continuing to improve its ski lifts, offering greater comfort for greater customer satisfaction.

Compagnie des Alpes supports numerous initiatives to promote mountain tourism in the summer. Moreover, the Group has embarked on the digitalisation of its marketing, in particular through its

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Compagnie des Alpes I 2020 Universal registration document