Annual Report 2020

Enterprise Risk Management

At GrandVision, we adopt a sensible risk-taking approach, which cannot be defined by one figure or formula. We set our risk boundaries to align with our strategy, values, policies and corporate directives. Our approach depends on the type of risk, as follows:

  • Strategic risk: GrandVision takes above-average, calculated and carefully-weighted risk in pursuing our growth ambitions.
  • Operational risk: GrandVision minimizes risks relating to the implementation of our strategy, but is not afraid to take decisive action in our business operations that are designed to improve customer satisfaction.
  • Financial risk: GrandVision has adopted a prudent financing strategy, aimed at maintaining sufficient financial headroom to continue to invest in the pursuit of our strategic objectives. We have also set very low tolerance levels with internal controls and financial reporting deviations.
  • Compliance risk: GrandVision strives for full compliance with all legal, regulatory and tax requirements, and does not tolerate non-adherence to our corporate governance policies.

We have implemented an annual risk management cycle, which identifies key risks and developments that we continue to address. Twice a year, all country management and central functional teams conduct risk assessments. Based on these assessments, and on an evaluation of the outcomes of risks already identified, we update the key risks.

In 2020, we identified approximately 230 risks. They were classified and consolidated using a quantification method to weigh potential impacts and likelihoods of the various risks. In addition, they were benchmarked with risks identified by other retailers to ensure that we included more general industry risks in the evaluation. The final key risk categories were reviewed and approved by management, the Audit Committee and our Supervisory Board.

During 2020, we monitored developments as an integral part of the performance management, internal controls and reporting cycles and then took the necessary actions to mitigate the identified risks.

We included climate-change related risks in the Enterprise Risk Management cycle, but they did not make it in the top 10 list that we are reporting on.

Strategic Risk

Risk area and possible impact
How GrandVision mitigates this risk

Increased focus in retail on price as the main differentiator as a result of full transparency and availability of online products. This requires GrandVision to continuously adapt our retail price policies to stay competitive.


GrandVision continuously invests in a portfolio of high-quality Exclusive Brand products that appeal to our customers. In addition, we invest in digital marketing campaigns and added-value sales promotions that enable us to remain price competitive. To support this strategy, we relentlessly pursue cost efficiencies in everything we do, from purchasing products and managing our physical and online stores to organizing back office operations. This helps keep our retail prices competitive.


Becoming less relevant to our consumers due to our products and services and how they are offered. Declining street traffic due to changing consumer habits with ongoing digitization plays an increasing role and requires new tools and skills.


The COVID-19 pandemic accelerated consumer behavior changes towards more digitally-influenced sales. To respond to this risk, we invested in our people, products and stores to remain relevant to our customers. Our investment in the digital omnichannel customer journey allows customers to decide how, when and where they want to buy our products, preserves our value proposition. It also succeeded during the COVID-19 pandemic to facilitate both offline and online shopping. In addition, we monitor eye correction alternatives that we believe will slowly take hold, as many customers prefer to wear glasses over eye surgery solutions.


Unfavorable economic or political developments, as well as natural or environmental disasters, may occur in our markets.


Our diversified portfolio in more than 40 countries is a strong mitigating factor against individual country or regional economic risks. We monitor these risks as part of our normal course of business and apply measures such as commercial promotions, financial hedging, internal reorganizations and cost savings to counter the potential impact in the short-term. Our integrated CSR focus also helps us have a broader perspective on non-financial contributors to our business and our impact on climate-related issues.

Operational Risk

Risk area and possible impact
How GrandVision mitigates this risk

Risk of sub-optimal implementation of global capabilities, including supply chain operations, will result in inefficiencies, declining product availability and loss of confidence.


The design of our Product Value Chain has matured to further support our end-to-end processes, with a focus on customer fulfilment and product categories. We have Business Continuity plans in place in case of natural disasters or other calamities, in addition to specific insurance that will help to reduce the financial impact of such events.

We will also continue to harmonize and improve the GrandVision product portfolio, resulting in further benefits to the company.


Traditionally, our focus is on our strong expansion where we are highly dependent on recruiting and educating new employees, especially opticians. In addition, we identified risks to grow digital capabilities that are a resource pool utilized by all major companies. The COVID-19 pandemic and remote work have amplified the importance of keeping an eye on cultural changes. With the control environment operating differently now, we realize the risk of stress on operations and people.


Employee health and safety is pivotal. That's why we have ensured that we comply with local regulations across all our markets, and put more emphasis on employee satisfaction. We deploy new HR initiatives to keep our people dedicated and motivated.

As a response to scarcity of optician and digital talent, we have established close connections with universities and higher education institutions. We provide strong training programs and are exploring ways to leverage transnational education.


The COVID-19 pandemic has had a significant impact on our company and presented itself in three major risks categories:

  • Supply Chain Disruption
  • Changing Customer Preferences (See Strategic Risks Section for more information)
  • Risk of a Pandemic


We have strong relationships with our suppliers and carefully manage our inventory levels in terms of ordering products to find the right balance per individual market. We implemented various internal initiatives to create less dependency on our store network and therefore mitigate COVID-19 pandemic impacts. Such initiatives comprise of, among others, acceleration of e-commerce plans, a move to customer order home delivery, and rotating shifts at support offices.


Product purchasing prices of eyeglass frames, lenses, sunglasses and contact lenses can increase, which result in margin pressure or require us to adjust our commercial policies.


GrandVision has multi-year contracts with key suppliers, thanks to holding competitive tender processes. In addition, the increasing centralization of our supply chain and the reduction of key suppliers allows us to harmonize our portfolio and achieve economies of scale.

Financial Risk

Risk area and possible impact
How GrandVision mitigates this risk

Deterioration of foreign currencies as a result of economic and political developments is reducing our profitability in certain markets.


We hold regular discussions with our main suppliers to mitigate currency impact that include sharing mechanisms, changing sourcing locations or adjusting invoicing currency prices. We further mitigate risk by regularly entering into FX contracts.


We operate stores and other activities in many countries. As tax laws and regulations differ per country and can be complex, we run an inherent risk of deviating views on the interpretation of tax legislation by local tax authorities.


The GrandVision Minimum Control Standards have a dedicated section stipulating internal controls to address tax-related risks. In addition, the Global Tax department assists local and divisional management in complying with tax requirements and monitoring the effectiveness of the internal tax-related controls as well as the tax position of the group.

Compliance Risk

Risk area and possible impact
How GrandVision mitigates this risk

Risk of impact on business performance by changing healthcare reimbursements or optical operating regulations in key markets.


Our portfolio is protected by operating in multiple markets with different regulations. Compared to independent opticians, we are better equipped to cope with these changes and capture market share in changed markets.

A quality assurance and regulatory affairs team provides assurance over existing activities and ensures compliance with, among others, Medical Device Regulation.

We successfully operate in many countries where eyecare reimbursements do not exist.

In the short-term, changing healthcare regulations can impact our results. And in the long-term, it supports our position as a high-quality, affordably-priced retailer and can help us gain market share in deregulating markets.


The efforts to further digitalize the customer journey also create increased vulnerability to cyber attacks and the necessity to secure sensitive information.


Our global policies and guidelines address information security requirements. Using these policies, we also take action to secure our networks, applications and support remote work.

We also perform internal assurance activities to ensure such activities remain compliant and to continuously improve on specific areas.