Identifying and managing risks is an ongoing, essential process that touches every aspect of our business. We systematically manage the risks to ensure we can deliver results.
The economic crisis caused by the coronavirus pandemic revealed unprecedented business risks across every industry. While few organizations can claim to have been fully prepared for COVID-19, Devon does include “global pandemic” among the possible risks in our enterprise risk management process. Volatility in demand, supply and price for our products are always risks we consider and, as a result, we expect that our preparedness, exemplified in our financial strength, will enable us to withstand the virus-induced shock where others in our industry may not.
Our board of directors has primary responsibility for risk oversight, a role that includes ensuring the appropriate design and implementation of the company’s risk-management programs. The four standing board committees consider the risks inherent in their areas of oversight and the Devon management team, in turn, executes the board’s risk-management directives. This includes overseeing and reporting on Devon’s day-to-day efforts to manage risk. Our enterprise-risk-management process includes an annual analysis in which we ask the board, management and subject-matter experts companywide to consider the likelihood that certain risks could cause economic or reputational damage to the company. We also consider our level of preparedness for each risk. This analysis helps us determine and prioritize the material risks to our business.
We also undertake exercises and workshops with employees focused on various risk-mitigation strategies. These workshops, including leaders from multiple work disciplines, also help us to identify new and emerging risks. These forums are valuable in maintaining awareness of business risk across the organization and also have helped us manage through recent commodity price volatility and the global coronavirus pandemic.
For a more detailed discussion of Devon’s material risks, please see our Annual Report on Form 10-K for the year ended Dec. 31, 2019.