Risk Management
Systematically identifying and managing risks is central to our ability to make informed decisions and provide long-term value to our stakeholders. Through our robust enterprise risk management (ERM) program, we proactively identify, evaluate and mitigate potential risks that could impact our operations, reputation, financial health and overall business goals.
Approach
Our comprehensive approach to risk management aims to integrate risk awareness and mitigation throughout all levels of the organization. In 2022, we continued to incorporate ESG risks, including climate-related risks, into our ERM program, reflecting our awareness that sustainability, commercial, operational, financial and audit risks are all relevant and correlated.
ESG Risk Management and Strategic Transactions
As discussed in the Economic Performance and Business Strategy section of this report, Crestwood completed several strategic transactions during 2022, requiring us to identify, manage and mitigate a wide range of potential risks across all areas of the organization.
As a result, we have taken a proactive approach to integrating ESG risks into our due diligence process by creating a comprehensive ESG due diligence risk register, which is shared with members of the senior leadership team and allows us to make informed decisions about how an acquisition could affect our ESG goals and key performance indicators.
Board Oversight of Risk Management
Our Board has responsibility for overall risk management for the company. Key enterprise risks, including ESG risks, have been assigned to each Board Committee for oversight and the Committee chairs regularly report back to the full Board.
In 2022, we further enhanced our ERM program by systematically integrating ESG risks into the Board-level review process. As part of the process, the ERM team met with each Board committee chair to discuss relevant ESG risks within their area of oversight. Crestwood team members responsible for monitoring and mitigation planning for each identified risk provide a comprehensive and in-depth review to the full Board of Directors throughout the year.
Climate-Related Risks
We thoughtfully and rigorously review, evaluate, monitor and manage climate-related risks and associated opportunities, including physical and transitional risks. These risks are a standalone category in our ERM process. Our Board’s Sustainability Committee routinely reviews climate-related risks and evaluates our ability to adapt.
To learn more, please refer to our Carbon Management section.
Crestwood Voice
At Crestwood, our ERM program aligns with our overall business objectives and is integrated into all decision-making processes. A key part of our program is the integration of ESG risks that are ever evolving in nature and provide a holistic approach to our risk management process. We remain committed to continuously evaluating and enhancing our risk management approach, as we know it is essential to our ability to deliver strong results in a responsible and ethical manner.
Angela A. Minas
Chair of Audit Committee
Enterprise Risk Management Process
Our annual ERM review process, led by our senior vice president of internal audit, technology and implementation services and our senior vice president of ESG and corporate communications, is a year-round collaborative and dynamic process.
