| Risks | Mitigation actions |
| Weakening of the global economic environment | KONE is exposed to risks that may arise from its operations or changes in the operating environment. The most significant risk factors described below can potentially have an adverse effect on KONE’s business operations and financial position and, as a result, on the value of the company. Other risks, which are currently either unknown or considered immaterial to KONE may, however, become material in the future. |
| Escalation of geopolitical conflicts and trade disruptions impacting the competitiveness of KONE’s supply chain, leading to increased costs or causing potential disruptions | KONE is continuously working on mitigating any potential delays of its products and critical components. KONE actively monitors the development of the applicable and relevant regulations, policies and trade rules, prepares for alternative scenarios and evaluates the competitiveness and viability of KONE’s supply chain and sourcing channels. KONE is taking actions to mitigate the impact of tariffs, for example by applying for tariff exemptions when applicable and reflecting tariff impacts into pricing. KONE also applies increased scrutiny over business operations that may be affected by international trade restrictions or other geopolitical actions. |
| Changes in the competitive landscape, customer requirements or competitors’ offerings impacting KONE’s competitiveness | KONE aims to be the industry leader with its competitive offering by investing in research and development and by taking an open innovation approach. KONE also closely follows emerging industry and market trends and actively monitors opportunities for industry consolidation. |
| Non-compliance concerns related to KONE´s business conduct | KONE's Code of Conduct forms an integral part of KONE’s company culture and is the foundation of its ethical business practices. Development of comprehensive anti-bribery and corruption measures, compliance risk assessments and localized programs, compliance trainings and extended compliance screening capabilities are examples of KONE´s preventative measures related to compliance risks. |
| A failure to secure and develop the needed organizational capabilities and competencies | KONE continuously evaluates the skills and competences required for the execution of the selected strategy and develops and/or acquires these from internal talent pools or externally. KONE also has extensive training programs in place to develop and retain critical talents. |
| Risks related to component and subcontracted labor availability |
KONE’s purchasing processes aim to identify critical suppliers and supply categories and implement alternative sources, long-term agreements, last-buy options and other measures to ensure availability of the supply.
Component and rare-earth element markets are closely monitored, and the situations managed with detailed planning of delivery execution and active involvement of supply chain partners, among other actions. KONE has also developed multinational subcontractor pools to ensure subcontractor capacity on a regional level. Subcontractors’ competences and capabilities are monitored and developed continuously.
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| Product integrity, safety or quality issues as well as issues with reputation | To mitigate product risks, KONE has strict quality control processes for product design, supply, manufacturing, installation and maintenance. In addition, KONE aims for transparent and reliable communication, to prevent reputational risks and to manage potential incidents. KONE also has stringent corporate governance principles in place. |
| Interruptions to KONE’s or its suppliers’ operations |
KONE actively develops business continuity management capabilities to reduce the impact and likelihood of disruptions within its supply chain. Furthermore, KONE monitors the operations, business continuity management capabilities, financial strength and cybersecurity of its key suppliers. In addition, KONE aims to secure the availability of alternative sourcing channels for critical components and services. KONE also has a global property damage and business interruption insurance program in place.
KONE’s global supply chain helps mitigate the risk of interruptions. KONE has ten manufacturing facilities in seven countries, multiple distribution centers and a large supplier network across the globe, which helps to mitigate the impacts from potential disruptions in individual locations or countries.
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| IT disruptions and cybersecurity risks | KONE’s security policies define controls to safeguard premises, information and information systems which are both in development and in operation. KONE works with third-party security service providers and trusted, well-known technology partners to manage the risks through the control framework. KONE has implemented a range of mitigation measures, such as resilient architectures, advanced security monitoring and incident response, supplier risk management and a global cybersecurity awareness program. KONE holds ISO 27001 and IEC 62443 certifications and also has a global cyber insurance program in place. |
| Financial risks | KONE applies centralized risk management in accordance with the KONE Treasury Policy. More information on financial risk management can be found in notes 2.4, 3.2 and 5.3 of KONE’s financial statements 2025. |
