Principles of financial risk management
The operations of the Finnair Group are by nature international and require significant amounts of capital. This means exposure to risks related to exchange rates, interest rates, credit, liquidity and commodity prices. The policy of the Group is to minimize the negative effect of such risks on cash flow, financial performance and equity.
Financial risk management has been centralized in the parent company's finance department, which coordinates operations in the Group and provides various internal banking services such as group accounts and netting services. Financial risk management is based on the risk management policy approved by the Board of Directors, which enables limited exposures to foreign exchange and interest rate risks within set risk limits.
In its management of foreign exchange, interest rate and jet fuel positions the company uses a wide range of hedging instruments and methods, such as forward contracts, swaps and options. |