Evolving trends & risks
Effective management of financial and non-financial issues is an integral part of our business model. Various environmental, social and governance related risks are shaping our operating environment and we regularly track how these potential risks could affect our business. Taking a holistic and balanced approach to risk management enables us to further our ambition to create a more resilient business for the future.
Introducing new products or technologies requires a significant commitment to R&D investment and to maintaining highly skilled employees. Changes resulting from global trends influence customer demands in our main markets. We anticipate these changes and continuously develop and invest in new products and technologies and improve existing products and services. Having just completed a major product investment cycle puts us in a solid position to compete and win in this competitive industry.
Our business is dependent on obtaining new orders and growing our services with customers in a highly competitive environment. We are taking proactive actions to provide products and services tailored to our customers' needs, deliver on our commitments and develop closer, more long-term partnerships with them through our aftermarket services.
Our global footprint exposes us to numerous risks relating to current and future regulations. Failure to comply with laws and regulations, including antibribery and other requirements could harm our reputation and reduce revenues and profitability. In addition to clarifying our ethics and compliance expectations, we continue to strengthen our compliance management system and embed our compliance culture across our network.
Employment market competition is fierce when it comes to hiring the highly qualified employees needed to complete the work we require, particularly in certain emerging countries. Our success depends on our ability to develop skills, to retain employees and to recruit, and there is no guarantee we will be successful. We have executed on our workforce optimization actions and are now standardizing learning and development opportunities and increasing internships to ensure our success.
Our products and manufacturing service activities are subject to laws and regulations where we operate, governing, among other things, human health and safety, product performance or material content, chemical use, energy and greenhouse gas emissions, air, water, noise pollution, hazardous materials and groundwater contamination. Embedding an HSE preventive culture in everything we do is essential to managing these risks effectively.
Changing climate, including from the impacts of global warming, could result in both physical risks, such as extreme weather and long-term shifts in climate patterns, and transitional risks, such as new regulations and technology. These changes could materially affect our business, results of operations and financial conditions. We are increasingly incorporating climate-related consideration into how we manage and oversee our product design, operations and customer relations.