The Group has a Chief Technical Officer and a dedicated technology team which monitors technology and business developments. Specifically, the team has developed technology roadmaps for its major technology families to ensure it is at the leading edge of technology development, but also to understand emerging and competing technologies.

The technology team proactively manages the Group's technology pipeline and R&D investment in new/improving technologies and is also focusing on productive management of the technology tail. This technology pipeline is regularly reviewed by the Group Executive and the Board.

Where Group products are designed for a specific customer, they are developed in tandem with the customer to maintain leading-edge differentiated solutions. The Group seeks to secure IP protection, where appropriate, for its existing and emerging portfolio of products; external advisers manage this protection globally.

Making Morgan a safe, fulfilling and rewarding Group to work for is the primary means of engaging the workforce and managing this risk. The Group has an HR Director and a network of HR professionals within the business who, along with policies and processes, support Morgan's managers to mitigate the risks relating to its people. The HR function covers areas including reward and recognition, health and safety, talent management, skills assessment and development, performance management and employee consultation.

A global employee survey was carried out in 2014, the results of which will inform further actions going forward.

In 2012 the Group launched a Graduate Leadership Programme which continued to run in 2014. The Group also launched in 2014 a global leadership programme in conjunction with Cranfield University to develop Morgan's high potential commercial leaders.

The Group's Treasury function, Treasury Policy and guidelines provide strict controls on the selection of banks and cash management. The Treasury team proactively manages and is ultimately responsible for all of the Group's funding, liquidity, cash management, interest rate risk, foreign exchange risk and other treasury business.

The Group has an in-house legal function supplemented by external lawyers.

The Group Legal Policy requires in-house legal review of high-value or high-risk contracts to ensure that the contracts contain the appropriate protection for the Group. CEO approval is required before any part of the business can enter into an unlimited liability contract or one where the liability cap exceeds £5 million. In 2014, the CEO approved 10 contracts or tenders with this liability profile, where the underlying risks were considered to be within the Group's risk appetite.

Contract risk management training remains part of the Responsible Business Programme (RBP) and will continue to mitigate the risk of ineffective contract management.

To the extent that risk has not been managed out of the contractual process, the Group has insurance cover approved by the Board, including product liability insurance.

The Group has an IT policy and guidelines in place as well as Group and business IT teams to manage the Group's infrastructure technology roadmap and IT risks.

During the course of 2014 there has been continued focus on testing the global infrastructure, including elements of IT auditing in the internal audit process, reviewing data management and developing the Group's business continuity plans in relation to IT risk.

A number of infrastructure improvements have been made in 2014 to mitigate the likelihood of a successful cyber-attack.

Many of the Group's products are designed to customer specifications. Over 90% of the Group's manufacturing output is accredited to ISO 9001 and the Group's quality management systems and training help ensure that Morgan's products meet or exceed customer requirements and national/international standards.

Contracts relating to products used in potential high-risk applications are subject to mandatory legal review.

While there were a number of minor product quality issues identified in 2014, these had no material impact.

The Group insurance programme includes product liability insurance; this Group-level insurance is reviewed annually by the Board.

The Group Executive is responsible for monitoring and managing these single-point exposures.

Local and Regional management of these risks involves monitoring and reviewing supply chains (internal and external), dual/multiple sourcing of materials or strategic stock, fire protection systems, creating and testing business continuity plans, and maintaining product quality and customer relationships.

The Group insurance programme includes business interruption cover; this Group-level insurance is reviewed annually by the Board.

The Composites and Defence Systems business has seen a reduction in business from the MoD during 2014; in response to this, the business has put increased emphasis on its product/customer diversification strategy.

The Group has a well-developed EHS programme managed by the EHS Director, with site-based EHS officers to implement and monitor EHS adherence at site level.

During 2014 the Group launched a global behavioural safety programme 'thinkSAFE'.

The Group is committed to the highest standards of corporate and individual behaviour and this commitment is set out in the Group's Core Values Statement and Ethics Policy.

Due to the potential magnitude of corporate fines, compliance risks are identified as some of the most significant risks for a number of reasons:

Ø Morgan's historic breach of anti-trust laws creates a greater sensitivity to anti-trust risk and means that the Group could be subject to the greater potential liabilities which attach to repeat offenders.

Ø The location of a number of Morgan businesses and customers means they are exposed to greater bribery risk.

Ø Morgan exports from the US and is therefore subject to the stringent US export laws.

The Group's Responsible Business Programme, and the US Export Director, address these areas of risk through policies, training/education and monitoring/assurance processes.

The Group's broad market/geographic spread helps to mitigate the effects of political and economic crises.

Key risks and events are regularly tracked at a business and Group level, with contingency plans in place to manage changing situations.

Financial and treasury controls limit exposure to foreign currency, interest rate, credit and liquidity risk. Also, the Group maintains a carefully managed debt facility to ensure that its debt ratio is within acceptable market tolerances.

Active management of the pension scheme assets is the primary means of mitigation. This comprises management both internally within the Group but also externally through corporate actuaries and professional advisers.