The year 2025 was marked by a demanding international context, characterized by the persistence of geopolitical tensions and the uncertainty associated with electoral processes in several relevant geographies. This scenario was further compounded by the high complexity and intensity of the flow of European legislation and regulation, as well as by evolving consumption patterns and purchasing power. In addition, the impacts of climate change and the growing relevance of technology and digitalisation in business models stood out, including the adoption of solutions based on Artificial Intelligence and the challenges associated with cybersecurity.
All these factors significantly impacted the conditions in which Jerónimo Martins’ Companies operated throughout the year, were reflected in the various risks to which the Group is exposed, namely in strategic and operational terms. Therefore, various measures were implemented in order to anticipate and mitigate the most relevant impacts on the execution of the strategic objectives.
Strategic Risks
Strategic risk management involves monitoring factors such as the quality of products and raw materials, environmental sustainability, social, political and macro-economic trends, namely the evolution of demographics and the shortage of human resources with specific skills, purchasing power, market dynamics (financial, employment, natural resources and energy), the geopolitical situation, technological innovation, legal and regulatory developments and social and reputational scrutiny to which the Group’s activities are exposed.
The management team uses this information to understand the market context and thereby identify any opportunities and threats for the development of its activities, namely in terms of potential growth and profitability, but also in terms of the strategic alignment of its business model in light of current and future conditions.
Operating Risks
Arise from the execution of normal business functions, across the value chain, and focuses on risks generated among the processes through which the Group units operate.
The operational risks cover risks related to the management of operational human resources, category management and sourcing, inventory management, logistics and supply chain, and the efficiency and safety in the use of resources and assets. It also considers the risks related to the behaviour of competitors, business partners, and consumers.
Fraud, money laundering and corruption risks are also considered in the risk assessment for the most relevant operational activities. The adequacy and range of the controls and mitigation measures are also reviewed and reconsidered whenever necessary.
Food Quality and Safety1
The Group seeks to provide safe and healthy food products and solutions in its Private Label and Fresh Perishable Products, and it seeks to ensure and enforce product safety measures in strict compliance with the highest food safety standards.
The Quality and Food Safety Departments of the Group’s Companies ensure these high standards through:
conducting supplier audits to ensure good production practices in compliance with Jerónimo Martins’ Quality and Food Safety Policy;
monitoring, by following the product throughout the logistics flow to assess compliance with the requirements defined in the Specifications Model – all JM companies are certified by Quality and Food Safety under ISO standards;
performing periodic product analyses based on the annual Analytical Plan, including physical-chemical, microbiological, and DNA testing in Accredited Laboratories to ensure label accuracy and compliance;
detecting food fraud by identifying species present in products, with the Group having its own Molecular Biology laboratory for this purpose; and
ongoing training through simulations and awareness-raising activities.
The Companies are monitored by quality control technicians, who evaluate the implementation of procedures, the effectiveness of training, and the suitability of the facilities and equipment.
Environmental Risks2
Jerónimo Martins implements processes to compile and evaluate data related to environmental sustainability, ensuring that the administration body is aware of the risks that the Company may incur, being able to outline and implement action plans to mitigate them. Regular assessments of the environmental risks and opportunities that may be associated with its businesses are therefore carried out, using studies and audits to assess the main impacts and dependencies of its activities on ecosystems and the resources they provide, in the following areas:
Analysis of risks and opportunities associated with impacts arising from climate change, water use and interactions with nature, as well as the quantification and assessment of the materiality of the Group’s greenhouse gas emissions (scopes 1, 2 and 3);
Analysis of risks and opportunities associated with impacts arising from the use of packaging for Private Brand and perishable products, as well as the quantification and materiality assessment of packaging materials and food waste generated;
Mapping, within the universe of Private Label and perishable products, of commodities associated with deforestation risks, including their origins and production methods;
Assessment of the level of conservation of the fish species sold under Private Brand and also in the perishables category;
Agricultural management practices focused on reducing water and energy consumption, preserving biodiversity, ensuring proper waste management, adopting best agronomic practices and supporting the economic sustainability of fruit and vegetable suppliers;
Carrying out internal and external audits at its own facilities, on Private Brand and perishables suppliers and service providers.
Therefore, the following risk typologies were identified:
Transition, which may cause an increase in costs in order to comply with environmental legislation and originated by the transition to a low-carbon economy, the promotion of biodiversity and the sustainable use of water resources;
Physical, which may result in shortage of natural resources, such as agricultural products, or disruption of supply chain activities associated with climatic events;
Reputational, associated with expectations of the Group’s stakeholders in what regards the impact and adaptation measures adopted by the Group.
The probability of occurrence of these situations and their level of impact, including financial risks, as well as their management, is analysed by the Group as part of the short, medium and long-term risk assessment processes. Based on these assessments, adaptation and mitigation measures are defined to maximize differentiating opportunities and improve the resiliency of our Companies and their businesses. These actions promote efficient management in the use of resources in the operations, products and services of the Group Companies, mitigate the occurrence of possible natural risks such as extreme climate events, and identify opportunities to create value from a logic of promoting environmental preservation and regeneration.
Assets, People, and Property Security Risks
The Security Department is responsible for ensuring the necessary conditions to protect people (employees, customers, suppliers, and shareholders), as well as physical and intangible assets.
Assets, people and property security risk management involves: i) definition and dissemination of standards and work instructions, ii) promotion of awareness initiatives and training initiatives for employees, iii) auditing of stores, warehouses, and other sites across all Group companies iv) risk assessment (threat analysis and identification of vulnerabilities), and the proposal of mitigation and/or elimination measures across all the Group’s universe, v) collaboration in the conduction of emergency drills, and vi) development of projects and the identification of innovative technological solutions to provide appropriate and proportional responses to the risks/threats the Group faces.
Technological and Information Security Risks
The risks associated to Information Technologies are analysed considering their different components: planning and organisation, development, innovation, operations management, information security and continuity.
The risk management of Information Security in the Group is the responsibility of an exclusively dedicated Department and consists of implementing and maintaining an Information Security Management System that ensures confidentiality, integrity and availability of critical business information, performing monitoring, control and incident management and recovery activities to identify, mitigate and respond to potential vulnerabilities.
Regulation Risks
Compliance with legislation is provided by the legal departments of the Group´s Companies.
Regarding the Holding Company, the Legal Affairs & Compliance Department guarantees the co-ordination and implementation of strategies aimed at protecting the interests of Jerónimo Martins in legal disputes, and it also manages outside advisers.
Compliance in issues related, particularly, with personal data and corruption prevention is the responsibility of the Legal Affairs & Compliance Department in collaboration with the Legal Department of the Group companies, the Information Security Department, the Internal Audit Department, the Human Resources Department, among others.
The Company, and the Group’s main companies, in Portugal and in Poland, also have a Data Protection Officer, in what regards data protection compliance.
In order to ensure the fulfilment of tax obligations, the Group Fiscal Affairs Department advises the Group’s companies, as well as oversees their tax proceedings.
Financial Risks
Jerónimo Martins is exposed to several financial risks, namely: price risk; which includes interest and exchange rate risks: transactional risk, which includes credit and liquidity risk; and the risk arising from the Group’s investments portfolio, including various risks such as interest rate, credit, foreign exchange, inflation, political and fiscal.
The management of these risks is focused on the unpredictable nature of the financial markets and aims to minimize its adverse effects on the Company’s financial performance.
Certain types of exposure are managed using financial derivative instruments.
The activity in this area is carried out by the Financial Operations Department. It is responsible, in conjunction with the financial areas of the Group´s companies, for identifying and assessing risks, and for executing the hedging of financial risks, by following the guidelines set out in the Financial Risk Management Policy.
Every quarter, the report on compliance with the Financial Risk Management Policy is presented to and discussed with the Audit Committee.
The information concerning financial risks to which the Group is exposed can be found in note 28 – Financial Risks.
1 The actions carried out by the Group for Food Quality and Safety in 2025 are detailed in “Consumers and end-users”.
2 Actions carried out by the Group during 2025, on Environment Protection are detailed in “Environmental Information”.