3M is committed to identifying and preparing for material opportunities and threats impacting our ability to deliver on stakeholder expectations. The concept of risk appetite and tolerance is an essential component of our strategic planning.
The Board delegates primary responsibility for the oversight of risks facing the company to the Audit Committee of the Board of Directors. The Audit Committee has direct oversight of the work of two senior vice president positions, the general auditor and the chief ethics & compliance officer, that both report to the chair of the Audit Committee. The general auditor, Corporate Audit, is responsible for leading the formal risk assessment and management process within the company and annually reports the results to the full Board.
3M’s general auditor conducted an annual review of the major risks facing the company and worked with executives to assess those risks and develop appropriate mitigation plans. To assure business continuity through global economic and geopolitical challenges, we prioritized the well-being of our workforce, resiliency of our global supply chain, environmental stewardship, and efficiency in our operations.
The general auditor met individually with each independent 3M Board member and each member of the executive-level Corporate Operating Committee (COC) to discuss risk management in general, as well as specific risk-related topics facing the company.
Our Enterprise Risk Management (ERM) initiative helps assure adequate recognition and ownership of the most significant potential risks to the company. In 2022, we added climate change risk, which was previously integrated as part of several high-risk areas, as a discrete risk to proactively monitor, measure, and manage.