Board Oversight and Risk Management Organisation
The Company has a well-defined Risk Management Policy providing for a structured framework for risk identification, assessment, mitigation, and timely reporting to safeguard stakeholder interests. The Board of Directors oversees Jindal Stainless’s risk management framework through the Risk Management Committee (RMC), established in accordance with the Company’s Risk Management Policy. The RMC holds primary responsibility for overseeing the organisation’s exposure to strategic, operational, regulatory, and sustainability-related risks. It conducts periodic reviews of key risks and mitigation strategies and submits its findings and recommendations to the Board.
This structured reporting ensures that the Board maintains effective oversight and that risk considerations remain aligned with the Company’s long-term strategy and ESG objectives. JSL’s risk governance approach ensures that risk considerations are not siloed but integrated with corporate strategy, investment planning, and business transformation efforts such as the transition to low-carbon operations and green supply chain practices.
The Company has instituted a multi-tiered risk management governance framework that ensures oversight, accountability, and transparency across all levels of the organisation, from operational execution to board-level supervision. At the operational level, business unit heads play a pivotal role as ‘Risk Owners’ in managing and mitigating risks within their respective domains, responsible for identifying potential risks, implementing control measures, and ensuring compliance with internal standards and external regulations. Their proximity to day-to-day operations enables timely responses to emerging risks, particularly in areas such as environmental compliance, energy security, health and safety, people concern and raw material volatility.
Each business or functional unit is supported by a ‘Risk Champion’, who is nominated by the Risk Owners to help maintain and enhance the risk management culture. The Risk Champion is also responsible for reporting to the risk owners and the Internal Audit, Governance & Risk Management function (IAGRM) on risk trends, mitigation plans, issues, and any challenges that may arise.
Providing oversight and support to these business unit heads (operational leaders) is the Head for Internal Audit, Governance, and Risk Management. The role includes the development of risk management frameworks, monitoring adherence to policies, developing risk culture frameworks, and providing regular updates on risk management to the Risk Management Committee (RMC) and MD/CEO. They play a critical role in strengthening governance by enabling structured risk assessments and strengthening a risk-aware culture.
Furthermore, the IAGRM team is responsible for evaluating the design and operational effectiveness of internal controls and risk mitigation strategies. This team conducts periodic audits and assessments, offering objective insights into the Company’s risk posture and ensuring that governance mechanisms are functioning as intended. As a result, the Company’s deep-rooted risk identification and management culture empowers every concerned individual, from the shop floor to the Board, to identify, assess, and manage risks, along with conducting proactive awareness sessions to build risk awareness among the concerned employees.
Risk Owners IAGRM Team (Function Heads) & Champions (SPOC)
Internal Audit, Governance CXO Meeting & Risk Management, Risk Owners IAGRM Team
MD, CEO & Internal Audit, Governance CXO Meeting
Risk Management Committee (RMC), Board level
At the top of the governance structure, the RMC plays a pivotal role in overseeing the Company’s enterprise-wide risk management framework. While the RMC does not directly integrate individual risks into the framework, it provides strategic oversight by reviewing the effectiveness of risk identification, assessment, and mitigation processes across the organisation. The Committee reports periodically to Audit Committee/Board, ensuring that risk governance remains aligned with Jindal Stainless’ long-term objectives and ESG commitments. This structured oversight reinforces transparency, accountability, and informed decision-making across all levels of the Company.
Risk Management Strategy and Process
At Jindal Stainless, enterprise risk management (ERM) is an integral part of the Company’s governance and strategic planning, ensuring that operations remain resilient and future-ready. The Company’s actions and disclosures reflect a structured, organisation-wide commitment to identifying and mitigating financial, operational, sectoral, and ESG-related risks. This decentralised and proactive approach allows the Company to remain agile in the face of evolving risks while embedding sustainability and resilience into its long-term business strategy.
Risk Assessment Process
Jindal Stainless’s ERM framework is built on globally recognised best practices, particularly the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework. It has been tailored to meet the Company’s specific business needs. The COSO framework provides a structured and integrated approach to risk management, emphasising the alignment of risk with strategy, performance, and governance. It comprises five interrelated components: Governance and Culture; Strategy and Objective-Setting; Performance; Review and Revision; and Information, Communication, and Reporting, which collectively support effective risk identification, assessment, and response.
Five Components of the COSO Framework
| COMPONENT | FOCUS AREAS |
|---|---|
| Governance & Culture | Redefining control culture and risk structure using management oversight alongside industry best practices. |
|
Strategy & Objective Setting |
Analysing business context using a ‘within & outside JSL’ view, function-level analysis and objective setting; defining risk appetite. |
| Performance | Identifying risks at function level and benchmarking with industry; focusing on new and emerging risks; defining risk response; conducting risk assessment against impact and likelihood. |
| Review & Revision | Evaluating risk response for mitigating risks; updating risk registers on a periodic basis in discussion with function heads. |
| Information & Reporting | Providing structured updates to the RMC and the MD/CEO. |
Risk Appetite and Assessment Criteria
Risk Appetite and Risk Tolerance
Jindal Stainless defines its risk appetite as the level of risk it is willing to accept in pursuit of its strategic and operational objectives. This appetite is determined through a structured process involving senior leadership and Board-level oversight. The Company’s risk tolerance, the acceptable variation around its risk appetite, is established for each risk category and is reviewed periodically to reflect changes in the internal and external operating environment.
Risk Assessment Criteria
To ensure a comprehensive approach consistent with best practices, Jindal Stainless determines risk ratings by mapping the likelihood of an event against its potential impact. The Company has developed a matrix structured on a 5x5 scale, with impact levels ranging from ‘Insignificant’ to ‘Significant’ and likelihood levels from ‘Remote’ to ‘Almost Certain’. Each cell reflects a numerical risk score and is colour-coded to indicate severity, ranging from Low to Severe, thereby enabling a clear and systematic evaluation of risk exposure. Jindal Stainless reviews its risk exposure at least twice a year to ensure compliance with statutory requirements and effective management.
Risk Assessment Matrix: 5x5 Impact vs. Likelihood Matrix
| RISK IMPACT | Remote 1 | Unlikely 2 | Possible 3 | Likely 4 | Almost Certain 5 |
|---|---|---|---|---|---|
| Significant 5 | 5 Minor | 10 Moderate | 15 Major | 20 Significant | 25 Significant |
| Minor 4 | 4 Minor | 8 Moderate | 12 Major | 16 Major | 20 Significant |
| Moderate 3 | 3 Insignificant | 6 Minor | 9 Moderate | 12 Major | 15 Major |
| Major 2 | 2 Insignificant | 4 Minor | 6 Minor | 8 Moderate | 10 Moderate |
| Insignificant 1 | 1 Insignificant | 2 Insignificant | 3 Insignificant | 4 Minor | 5 Minor |
Significant, immediate escalation to the Board and Risk Management Committee.
Minor, monitoring at business unit level with periodic reporting.
Major, requires Board/RMC attention and structured mitigation plan.
Insignificant, routine oversight through standard operating procedures.
Moderate, requires management review and defined action owner.
The Head of IAGRM evaluates the effectiveness of the ERM framework annually by auditing the existing process and providing assurance that it complies with the defined ERM policy and COSO guidelines. The gaps and findings are then reported to senior management and the RMC.
The Internal Audit function also serves as the third line of defence by providing assurance on the effectiveness of JSL’s risk management, internal control, and governance processes along with the RMC.
Strengthening Risk Culture through Capability Building
Jindal Stainless firmly believes that an effective risk management framework must be underpinned by a strong risk-aware culture across all levels of the organisation. To this end, the Company is advancing dedicated initiatives to strengthen risk literacy and embed risk consciousness into everyday decision-making.
Board-Level risk education
The Company sensitises senior management and non-executive directors to risk management principles, incorporating industry trends and updates to standard frameworks such as COSO. The training programme aims to deepen directors’ understanding of contemporary risk themes, emerging exposures, and governance considerations relevant to the Board’s oversight responsibilities, thereby equipping them with the knowledge and context required to guide the organisation through an increasingly complex risk landscape.
Focused Training on Risk Management Principles, across the Organisation
In parallel, focused training on risk management concepts and principles is provided across the organisation through the Company’s internal learning platform. By promoting a common understanding of risk and individual accountability, Jindal Stainless aims to foster a risk-aware culture where employees are equipped to identify, assess, and respond to risks within their areas of responsibility, thereby enhancing the Company’s overall risk resilience.
Emerging Risks on the Horizon
Cyber Risks (Technological)
The Company’s increased reliance on digital systems has enhanced operational efficiency but has also heightened its exposure to cybersecurity threats. These threats now extend beyond traditional data breaches to include potential disruptions of physical operations through targeted attacks on industrial control systems and connected equipment. The widespread availability of AI tools further complicates the detection and prevention of cyberattacks.
Additionally, the growing adoption of cloud services introduces new security challenges related to data storage and online operations. Such attacks can result in direct financial losses through theft, ransom payments, and recovery costs, as well as indirect impacts such as production downtime, lost orders, and reputational damage. Cyberattacks may also compromise sensitive data, intellectual property, and competitive positioning, thereby hindering innovation and market standing. Operational disruptions, equipment damage, and supply chain interruptions can significantly affect output, efficiency, and delivery timelines.
To mitigate these risks, Jindal Stainless has implemented robust network security measures, conducts regular system updates, provides employee training, and maintains comprehensive incident response plans. The Company prioritises data security and safeguards its manufacturing processes to ensure uninterrupted operations and uphold the integrity of its products and services.
Low Carbon Steel Trade Mandates/ Border Adjustment Regimes Beyond EU CBAM (Geopolitical and Regulatory)
An increasing number of countries, including the United States and Canada, are considering or piloting low-carbon steel trade policies like the European Union’s Carbon Border Adjustment Mechanism (CBAM). These initiatives aim to penalise imports of carbon-intensive steel or to provide trade advantages to low-emission (green) steel. While CBAM is already in its transitional phase in the EU, other countries’ regulations remain at an early stage, with uncertain scope, enforcement timelines, and benchmarks.
These developments present several potential impacts. High carbon-intensity products may face export disruptions or become ineligible in key markets. Without recognised ‘low carbon steel’ credentials, Indian steel could be subject to carbon border tariffs, reducing price competitiveness and margins. Additionally, buyers and governments may increasingly require proof of lowcarbon content through certified Monitoring, Reporting & Verification (MRV) systems, necessitating new tracking capabilities. Strategically, these policies could influence Jindal Stainless’s product mix, energy sourcing, procurement strategies, and investment decisions
To mitigate these risks, Jindal Stainless is expanding the use of renewable, green, and low-carbon technologies in steelmaking. The Company actively participates in global forums to remain ahead of regulatory developments and to represent India’s decarbonisation efforts. Furthermore, Jindal Stainless plans to invest in green steel branding, certification, and traceability labels to differentiate its low-emission products and maintain access to premium markets.