Risk management

Risk management

Expected risk factors

The identified risks have a direct and indirect impact on the successful operation of the air traffic control services provider LGS through ensuring the efficient and financially stable development of the company. The occurrence of any of these risks has a direct impact on the performance of LGS and its progress towards its goals.

Financial risks

  • Availability of financial resources, including lending interest rate risks, for ensuring provision of appropriate technologies and human resources.
  • Late payments by customers.
  • Currency exchange rate risks.
  • Liquidity risks.

Operational risks

  • Delimiting part of the air space for military purposes without express consent from civil aviation thus affecting flight efficiency and air space capacity.
  • Human risks and timely process change management risks due to changes in legislation or operating conditions.
  • Unstable technologies, lack of integrity of new technologies, introduction of innovative security infrastructure and services to prevent or minimise vulnerability risks of the functional system.
  • Strikes by civil aviation employees.

Reputation risks

  • Public dissemination of false information about the operations of LGS.
  • Fraud and corruption risks where decisions can be taken in favour of the interests of the decision-taker or another person, illegal gains which are detrimental to the company and its image.

Strategic risks

  • Delayed definition of a legislative framework for LGS services creating a legislative void, which affects third party actions in the context of LGS service provision.
  • Capacity of the industry to develop new technologies for the development of the sector.
  • Unexpected increase or decrease of flight intensity going significantly beyond planned scenarios can create the risk that LGS ATCs cannot attend to all aircraft en route in the allotted time thus causing delays in flight times.
  • Availability of capacity and resources for developing of services and infrastructure.
  • Maintaining competitiveness in the context of globalisation.

The aforementioned circumstantial factors and risks are an integral part of the overall conditions to be considered within the operations of the air traffic control service provider. Management of risks within the control of the capital company by minimising the likelihood of the risk or its negative consequences is implemented through the internal management and control system, which is constantly being enhanced, and the safety management system. In order to ensure air traffic control service quality, LGS introduced a quality management system in 2000. Since 6 November 2001 the LGS quality management system is ISO 9001 certified. In order to ensure a high level of safety in air traffic control, the compliance of LGS services is assessed by the CAA within its area of competence issuing relevant certification.

LGS policy for risk management, avoidance of conflict of interest and corruption prevention

The core principal of LGS operations is air traffic control service safety. LGS is committed to developing, implementing and improving its working methods and procedures aimed at ensuring the highest possible level of safety and supporting the provision of air traffic control services through the available resources in compliance with international and national regulations and standards.

The objective of the LGS corruption and conflict of interest prevention policy is to ensure the full awareness of its employees in regard to the actions and forms that corruption and interest conflicts can take, so that employees may assess the compliance of their actions with the internal and external regulations in force and avoid violations thereof.

In 2020, the procedure was reviewed – amendments were made in accordance with the changes in the LGS structure. Additionally the risks related to the performance of work duties were reviewed.