Sasol fosters a risk-aware culture where risk management is embedded in how the organisation operates and makes decisions. This is supported through leadership accountability, communication and training, integration into core business processes, enabling technologies and the incorporation of risk management activities into day-to-day operations.

The Sasol Limited Board has the overall accountability for the oversight of risk management and is supported by the Board Committees and the Group Executive Committee in fulfilling these responsibilities.  The Group Executive Committee members are responsible for the management of risks in their areas of accountability, with delegated responsibility to and ownership of risks by their line managers. Management is responsible for implementing and monitoring key responses within the governance direction, risk appetite and tolerance parameters approved by the Board

The Sasol Group is governed through established structures that provide for appropriate delegation of authority while enabling the Board to maintain effective oversight. As a direct or indirect shareholder, Sasol Limited exercises its rights and participates in decision-making on significant matters relating to its subsidiaries. Subsidiaries adopt the Group governance framework as appropriate and align their governance arrangements with applicable Group requirements and minimum governance standards.

Responsibility for Sasol’s ERM framework and supporting processes resides with the SVP Risk and SHE who is responsible for enabling ERM and Combined Assurance across the company and ensuring that Sasol’s ERM framework is aligned to leading practice, governance and risk management frameworks and guidelines, including South Africa’s King Code for Corporate Governance, the Committee of Sponsoring Organisations’ Enterprise Risk Management Integrated Framework (2017) and the International Standards Organisation’s 31000:2018 Risk Management Guideline.

At Sasol, we apply an integrated risk governance model that embeds risk management into our strategic intent and execution. Oversight is driven by the Board of Directors, supported by Board Committees and the Group Executive Committee. 

The Board holds ultimate accountability, ensuring alignment with Sasol’s ERM Framework and Combined Assurance Model (CAM). Its responsibilities include:

• Strategic risk oversight: Setting direction through our Risk Policy and defining Group financial risk appetite and tolerance metrics to support sustainable growth.
• Risk Management Effectiveness: Evaluating the adequacy and performance of risk processes aimed at proactive management of material risks, understanding health and status of our key responses and driving continuous improvement through improved risk maturity over time.
• Board Committees’ role: Overseeing assigned Group material risks and ensuring assurance mechanisms align with the CAM.

The governance framework is supported by a clearly defined approach to risk appetite and tolerance, which guides decision-making and establishes boundaries for acceptable risk-taking across the Group.

Managing Group risk appetite and tolerance

Sasol applies a disciplined approach to managing Group risk appetite and tolerance, aligned with its strategic objectives and long-term value creation. Through the One Sasol ERM Approach, risk considerations are embedded in decision-making.

Risk appetite is the extent and type of risk Sasol is willing to take in pursuit of its strategic objectives. Risk tolerance is the level of risk Sasol is prepared to accept and establishes clear boundaries beyond which the company will not operate.

Financial risk appetite is actively managed against Board-approved metrics, including net debt, gearing and net debt to EBITDA. These metrics are regularly reviewed to reflect emerging risks and changing business conditions and to support financial resilience and strategic agility.

At Sasol, we embed risk management into our strategic framework to support resilience, disciplined execution, and sustainable value delivery.

Our Group Material Risks (GMRs) are actively managed and reviewed in alignment with:

• Our Group ambition and priorities.
• Strategic objectives and value levers.
• Key priorities and performance metrics.
• Defined risk appetite and tolerance parameters.

We conduct an annual GMR review to assess key uncertainties across our operating environment, drawing on internal insights, external developments, and industry benchmarks.

Recognising that risks and opportunities materialise over different timeframes, Sasol assesses and manages GMRs across short-, medium- and long-term horizons. This forward-looking approach supports the identification of emerging risks and opportunities, enables informed decision-making and strengthens organisational resilience over time.

• Short-term: 0-2 years 
• Medium-term: 2-5 years 
• Long-term: more than 5 years
• GMRs are linked to Sasol's strategic objectives, material matters and six capitals, providing a balanced view of dependencies, trade-offs, resilience and long-term value creation.

Across our business we apply a standardised, enterprise-wide process to identify, assess and respond to material risks, both strategic and performance-related, across short- medium- and long-term horizons. This enables risk-based decision-making in a dynamic operating context and supports Sasol’s strategy by proactively managing Group material risks that may impact current performance and future strategic ambitions. 

Sasol’s risk profile and related responses are reviewed regularly to ensure continued relevance and alignment. This positions the Group to manage uncertainty responsibly while unlocking future strategic opportunities in an evolving global energy and chemicals landscape.

Effectiveness of the Risk Management Process

The effectiveness of Sasol's risk management framework and processes is monitored through management oversight, established governance structures, the Combined Assurance Model (CAM) and independent assurance activities. Board Committees oversee assigned Group Material Risks and the assurance mechanisms supporting their key responses. Combined assurance deep-dives are also conducted to understand assurance coverage across key responses and identify areas requiring improvement.

The annual review of the risk management process by the internal audit team, Sasol Assurance Services (SAS), underscores the importance of independent assessment and oversight in ensuring the effectiveness of risk management practices within the organisation.  Such reviews are prioritised and approved by the Audit Committee.  As part of their mandate, the internal audit team, led by the Chief Assurance Officer, conducts audits to evaluate the adequacy and effectiveness of various processes and controls across the organisation. SAS includes an annual audit of the risk management function and process. The review encompasses a comprehensive evaluation of the risk management framework, methodologies, policies, and procedures in place within the organisation. This includes assessing how risks are identified, assessed, prioritised, and mitigated across different business units and functions.

SAS operates independently from the risk management function to ensure unbiased assessments. Their findings and recommendations are based on objective analysis, aiming to provide an accurate assessment of the strengths and weaknesses of the risk management process.  The insights and recommendations generated from the annual review serve as valuable input for enhancing our overall risk management capabilities. By identifying areas for improvement and implementing corrective actions, Sasol is able to strengthen its operational resilience and long-term viability

Sasol continuously monitors and assesses emerging risks and external developments that may impact the business over the short, medium and long term. Through environmental scanning, risk intelligence and ongoing engagement with internal and external stakeholders, emerging risks are evaluated for potential impacts on strategy, operations, reputation and performance. Relevant emerging risks are incorporated into risk assessment, planning and decision-making processes and may be escalated into the Group Material Risk profile where appropriate. 

For examples of emerging risks currently being monitored through Sasol's Emerging Risk Watchlist, refer to the latest Integrated Report.

Sasol's approach to enterprise risk management recognises that effective risk management not only protects value but also enables the identification and realisation of opportunities. Opportunities are considered as part of strategic planning, risk management and business performance processes and are assessed using the same materiality-driven principles applied to Group Material Risks (GMRs). 

Opportunities may arise from the successful execution of risk responses, changes in the external environment, technological advancements, evolving stakeholder expectations, regulatory developments or shifts in market dynamics. By continuously monitoring internal and external developments, Sasol seeks to identify opportunities that enhance resilience, strengthen competitiveness, improve operational performance and support long-term value creation.

Opportunities are monitored and reviewed through Sasol's governance and risk management processes to support informed decision-making and the sustainable creation of value over the short, medium and long-term. 

For examples of current opportunities identified through our ERM process, refer to the latest Integrated Report