SVKM'S

NMIMS
Deemed to be UNIVERSITY
NAVI MUMBAI

DEBT MARKETS

CRISIL ASSIGNMENT

Uday Shekhar - F021

Manavi Bhargava - F023
Anubhav Gupta - F026
Sahanya Shetty - F032
Lavanya Lakhwani - F047
Global Research
& Analytics

Case -Johnson & Johnson

Ticker: (NYSE: JNJ)

There are 2 sections in this file. Try to cover whatever is best possible in the stipulated time.

Section 1: Write a short commentary, highlighting the following:

Financial analysis covering key credit metrics -
o Analytical inputs for Y-o-Y trend of key profitability metrics
Y-o-Y analysis of cash flow statements (including free cash flow)
balance sheet analysis including leverage, and
liquidity profile of the company
Section 2: Write a brief note highlighting:
Key credit strengths and risks to the entity's credit risk profile (include mitigating factors to the risks where
possible)
Your aim should be to cover only the most relevant strengths and risks and cover them in adequate detail.
Instructions:
We have attached the relevant financial statements in this file for your reference. You can source information
from the entity's website or use Google if you wish.

AR21.pdf

However, given the time limit of the test, please use your time judiciously. Most of the material will be available
in the attached statements.

Criteria for evaluation would be the following:

Analytical arguments offered to justify the assessment
Candidate's hold on language and grammar used in the write up
Structure, flow and presentation of the content
Please note that only text is required. Any charts/tables included inthe write up will not be evaluated.
 Section 1:

" Analytical inputs for Y-o-Y trend of key profitability metrics

Operating margin/ Operating ratio
fluctuations, indicative of the dynamic
In recent years, Johnson & Johnson's operating margins have exhibited notable challenges in cost structures
business environment. The year 2022 saw a significant downturn of 5.79%, suggesting potential successful strategies
or revenue streams. Conversely, 2021 marked a remarkable upswing with a 21.599% increase, reflecting
with a 5.40% decrease, likely
in cost management or revenue generation. However, the year 2020 presented a downturn continued in 2019, with a 4.29%
influenced by the unprecedented challenges posed by the COVID-19 pandemic. This trend
& Johnson's
decrease. These fluctuations underscore the intricate interplay of internal and external factors shaping Johnson
financial performance. A nuanced analysis of the specific drivers behind each year's change is imperative for informed
decision-making.
Gross Profit Margin
Over the past five years, Johnson & Johnson's groSs profit margin has displayed a nuanced trajectory, indicative of the
company's adeptness in navigating the intricacies of its core business operations. In 2022, the margin experienced a slight
contraction to 67.26%, warranting an investigation into potential factors such as shifts in production costs, pricing dynamics,
or alterations in the product mix. The preceding year, 2021, showcased a robust gross profit margin of 68.169%, underscoring
the company's efficacy in maintaining profitability from its fundamental operations. Analyzing the year 2020 reveals a
margin of 65.58%, suggesting a potential impact from external factors, possibly related to the global health landscape. A
meticulous examination into the components influencing this margin is pivotal for strategic planning. In 2019, the margin
stood at 66.42%, reflecting stability, while 2018 displayed a solid foundation with a margin of 66.79%. Understanding the
strategies implemented during these periods that contributed to a strong margin provides a historical context for evaluating
long-term performance. OveralI, Johnson &Johnson's gross profit margin trend, marked by slight fluctuations, underscores
the companys proficiency in managing costs and deriving value from its operations.
Net Profit Margin
Over the past five years, Johnson &Johnson's net profit margin has exhibited a dynamic pattern, revealing the company's
effectiveness in converting revenue into profit after accounting for all expenses., In 2022, the net profit margin decreased to
18,90%, signifying potential challenges such as increased operating expenses or shifts in financial leverage. The preceding
year, 2021, demonstrated a robust net profit margin of 22.26%, highlighting the companys efficiency in converting a
significant portion of its revenue into profit. However, 2020 saw a decrease to 17.82%, possibly influenced by external factors
related to the global health landscape. Adetailed investigation into the components affecting the margin is crucial for strategic
planning. In 2019, the net profit margin remained relatively stable at 18.42%, showcasing the company's adeptness in
maintaining consistent financial performance. The solid foundation of 18.75% in 2018 reflects effective strategies employed
during that period. Overall, Johnson &Johnson's net profit margin trend, marked by fluctuations, underscores the company's
proficiency in managing costs and deriving profit from its operations.

Return on Equity (ROE)

Johnson & Johnson's Return on Equity (ROE) over the past five years reflects a dynamic performance, showcasing the
company's ability to leverage shareholder equity for returns. In 2022, the ROE decreased to 23.36%, signaling a potential shift
in the company's returm-generating efficiency and prompting a closer examination of influencing factors. The robust 28.20%
ROE in 2021 indicates efficient utilization of equity for returns, emphasizing successful financial strategies. However, the
slight decrease to 23.25% in 2020 prompts an exploration of internal and external factors impacting this change. The stable
ROE of 25.42% in 2019 and 25.60% in 2018 signifies consistent performance, with the latter reflectinga solid foundation.
Overall, Johnson & Jahnson's ROE trend, marked by fluctuations, underscores the company's proficiency in optimizing
shareholder equity for returns, with each year offering valuable insights into specific strategies for sustained financial success.

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Global Research
&Analytics

Return on Assets (ROA)

Johnson &Johnson's Return on Assets (ROA) over the past five years reflects a dynamic performance in leveraging its
assets for profitability. The ROA decreased to 9.57% in 2022, signaling a potential shift in the company's ability to generate
returns from its assets and prompting aloser examination of influencingfactors. The robust 11.47% ROA in 2021 indicates
effective asset utilization for profitability, underlining successful financial strategies. However, the decrease to 8.41% in
2020 prompts an exploration of internal and external factors impacting this change. The stable ROA of 9.59% in 2019 and
10.00% in 2018 signifies consistent performance, with the latter reflecting a solid foundation in asset efficiency. Overall,
Johnson & Johnson's ROA trend, marked by fluctuations, underscores the company's proficiency in optimizing asset
deployment for returms, with each year offering valuable insights into specific strategies for sustained financial success.
Y-o-Y analysis of cash flow statements (including free cash flow)
Cash flow from Operational Activities
Examining Johnson & Johnson's (J&J) operational cash flow statement provides valuable insights into the company's future
rajectory, as despite facing challenges in 2019 and 2020, the subsequent rebound in net income with a 41.89% increase in
2021 suggests J&J's capacity to adapt and recover from economic fluctuations. The consistent upward trend in Funds from
Operations (FFO), reaching S25.21 billion in 2022, indicates the company's strong ability to generate cash from its core
activities. Efficient working capital management is also showcased, particularly in navigating negative changes in 2021 (
S4.24 billion) and 2022 (-$4.01 billion), demonstrating J&J's agility in challenging economic environ ments, however the
slight decrease in net operating cash flow as a percentage of sales in 2022 (22.319%) signals a potential area for improvement
in operational eficiency. Considering J&I's pharmaceutical and healthcare nature, is resilience during the COVID-19
pandemic is notable, positioing the company well for future stability in apost-pandemic era where healthcare demands are
expected to persist. To enhance future performance, strategic focus on optimizing operational efficiency and continued
investment in R&D, alongside potential M&A, could further strengthen J&J's market position, indicating an adaptable and
resilient company well-positioned for sustained growth and leadership in the pharmaceutical and healthcare sectors through
strategic initiatives.

Cash flow from Investing Activities

Examination of Johnson & Johnson's investing strategies over recent years reveals both stability and adaptability in their
approach. Capital expenditures have remained consistent, ranging between $3.67 to $4.01 billion from 2018 through 202,
demonstrating a continued commitment to maintaining and enhancing infrastructure crucial to operational efficiency.
Significant funds have also been deliberately allocated to other assets, with negative values as high as -$17.65 billion in
2022, indicating strategic efforts to expand the business through targeted
Th vartability in sales of fixed assets and businesses
n e a l i s and enhancement of specific assets.
Ihe in 2019 before decreasing to $543 million in
2022, illustrates the company's flexibility in dynamically adjusting their asset portfolio in response to shifting market
dynamics. Substantial purchases of investments in 2019 and 2020, coupled with strategic disposals in 2021 and 2022,
resulted in a sizable net loss of -$16.93 billion - reflecting actively managed portfolio strategy aimed at optimizing
resources. Notable fluctuations in other uses and sources of cash, such as -$1.51 billion in 2020, further suggest a prudent
approach to financial management aligned with long-term strategic goals. The remarkable escalation in both purchase and
sale of investments, from $533 million in 2019 to -S8.95 billion in 2020, indicates an opportunistic response to global
economic uncertainties exacerbated by the COVID-19 pandemic. Most recently, the steep decline in net investing cash flow
to -S12.37 billion in 2022 signals a potential shift in investment priorities, while the negative trend as a percentage of sales
may prompt review of optimization opportunities. The company's investment activities showcase both stability through
consistent commitments as well as strategic agility in adjusting their portfolio to capitalize on emerging opportunities and
maintain maximum financial flexibility through changing market conditions.
 Cash flow from Financing Activities
Examination of Johnson & Johnson's financial movements in recent years provides insightful perspective into both the
company's priorities and strategic decision-making, as a progressive increase in cash dividends paid to shareholders reaching
SIl.68 billion in 2022 demonstrates aconsistent dedication to investor value, while the dynamic execution of stock
repurchase initiatives totaling S6.04 billion indicates prudent management of equity. The nuanced approach to debt levels is
also evident, with anet issuance of S7.45 billion in long-term debt reported for 2022, and fluctuations in prefered stock
dividends and the sale of common and preferred shares further highlighting the care taken to optimize the cost of capital
structure, though the varying trends warrant deeper consideration of underlying rationales. Notably, net financing cash flow
experienced fluctuations ranging from -S18.51 billion in 2018 to -$8.87 billion in the most recent year, reflecting the
substantial impact that dividend payments, buybacks, and debt activities have on overall liquidity, despite which J&J
impressively generated S17.19 billion in free cash flow for 2022, underscoring financial resilience and internal funding
capabilities. While the movements generally indicate a prudent approach, the decrease in net financing ecash flow for 2022
prompts questions and gaining clearer insight into how financial activities align with future growth ambitions and capital
allocation strategies will be important for stakeholders assessing long-term sustainability and fiscal health under this
management team.

Free Cash Flow Analysis

An in-depth analysis of Johnson & Johnson's Free Cash How (FC) over the past five years illuminates the company's
commendable financial performance. In 2022, the generation of $17.19 billion in FCF underscores the company's resilience
and adept cash-generating
fluctuation capabilities,capacity
suggests the company's despite toamarginal decrease
recalibrate fromstrategies
financial the S19.76in billion achieved
response in 2021.circumstances.
to evolving Thisnuanced
Noteworthy is the exceptional performance in 2020, amidst global pandemic challenges, where J&J maintained a robust FCF
of $20.19 billion, showcasing not only financial prowess but also adaptive financial management. The consistently positive
trend extends to prior years, with FCF figures of $19.92 billion in 2019 and $18.53 billion in 2018. These figures signify the
company's prowess in eficiently managing operational expenses and capital expenditures, resulting in a surplus conducive to
strategic investments, acquisitions, and shareholder value enhancement. The unwavering and substantial FCF position places
Johnson &Johnson in an advantageous financial posture, providing both flexibility and resources to adeptly navigate the
dynamic landscape of the healthcare industry.

" Balance sheet analysis including leverage

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources
of capital (its equity and liabilities). It normally also provides information about the future earnings
assets as well as an indication of cash flows
capacity of a company
that may come from receivables and inventories.
Assets are resources controlled by the company as a result of past events and from which future economic benefits are
to flow to the entity.
expected

Current assets are the sum of the carrying amounts as of the balance sheet date of all
assets that are expected to be realized in
cash, sold, or consumed within one year (or the normal operating cycle, if longer ). Johnson &Johnson
current assets increased
from 2020 to 2021 but then slightly decreased from 2021 to 2022 not
the amount after accumulated depreciation, depletion and
reaching 2020 level. Property. plant and equipment is
amortization of physical assets used in the nomal conduct of
business to produce goods and services and not intended for resale. Johnson &Johnson
increased from 2020 to 202l and from 2021 to 2022. Non-current assets are the sum of theproperty, plant and equipment, net
sheet date of all assets that are expected to be realized in cash, sold or carrying amounts as of the balance
consumed after one year or beyond the normal operating
cycle, if longer. Johnson & Johnson non-current assets decreased from 2020 to 2021 but
then increased from 2021 to 2022
exceeding 2020 level. Total assets are the sum of the carrying amounts as of the balance sheet
date of
recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result all assets that are
events. Johnson &Johnson total assets increased from 2020 to 2021 and from 2021 to of past transactions or
2022.

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Global Research
&Analytics
Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an
outflow of economic benefits from the entity.
or
Total obligations incurred as part of normal operations that are expected to be paid during the following twelve months
within one business cycle, if longer. Johnson & Johnson current liabilities increased from 2020 to 2021 and from 2021 to
2022. Amount of obligation due after one year or beyond the normal operating cycle, if longer. Johnson & Johnson non
current liabilities decreased from 2020 to 2021 and from 2021 to 2022. Sum of the carrying amounts as of the balance sheet
date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present
obligations of an entity to transfer assets or provide services to other entities in the future. Johnson & Johnson total liabilities
decreased from 2020 to 2021 but then increased from 2021 to 2022 not reaching 2020 level. Total of all stockholders' equity
(deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the
parent. The amount of the cconomic entity stockholders' equity attributable to the parent excludes the amount of stockholders
equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrol ling
interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Johnson &Johnson
shareholders' equity increased from 2020 to 2021 and from 2021 to 2022.

Leverage:
4 Johnson &Johnson's financial leverage last quarter was 2.3x
4 Johnson& Johnson's financial leverage for fiscal years ending December 2018 to 2023 averaged 2.6x.
Johnson &Johnson's operated at median financial leverage of 2.6x from fiscal years ending December 2018 to 2023.
Looking back at the last 5years, Johnson &Johnson's financial leverage peaked in January 2021l at 2.8x.
4 Johnson &Johnson's financial leverage hit its 5-year low in January 2023 of 2.4x.
Johnson &Johnson's financial leverage decreased in 2018 (2.6:x, -2.19%), 2022 (2.5x, -11.0%), and 2023 (2.4x, -0.81%)
and increased in 2019 (2.7x, +3.6%) and 2021 (2.8x, +4.29%).
" Liquidity profile of the company
Johnson &Johnson's current ratio for the quarter that ended in Sep. 2023 was 1.21. It generally indicates good short term
financial strength.

Liquidity Ratio Description 2020,2021,2022 2023

Current ratio Aliquidity ratio calculated asJohnson &Johnson current ratioJohnson & Johnson current ratio
curent assets divided byimproved from 2020 to 2021 butimproved from Q1 2023 to Q2 2023
current liabilities. then deteriorated ignificantlyjand from Q2 2023 to Q3 2023.
from 202l to 2022

Quick ratio Aliquidity ratio calculated asJohnson & Johnson quick ratio<Johnson & Johnson quick ratio
(cash plus short-termjimproved from 2020 to 2021 butimproved from Q1 2023 to Q2 2023
|marketable investments plusthen deteriorated significantlyland from Q2 2023 to Q3 2023.
receivables) divided byfrom 2021 to 2022.
current liabilities.

Cash ratio Aliquidity ratio calculated asJohnson & Johnson cash ratioJohnson & Johnson cash ratio
(cash plus short-termimproved from 2020 to 2021 butdeteriorated from QI 2023 to
marketable investments)(then deteriorated significantlyQ2 2023 but then slightly improved
divided by current liabilities. from 2021 to 2022. from Q2 2023 to Q03 2023.

5
Section 2:

KEY STRENGTHS

Minimal Debt and Prudent Capital Structure

The business keeps its debt-to-equity ratio low, which suggests a conservative capital structure. By doing this,
the financial risk brought on by large loan commitments and interest payments is decreased. Maintaining a
minimal debt and prudent capital structure also allows the business to have more flexibility in allocating funds
towards growth opportunities or unforeseen expenses. Additionally, a low debt to equity ratio may enhance the
company's creditworthiness and ability to secure favourable terms for future borrowing if needed.

Effective Corporate Governance and Management

Effective corporate governance procedures and a skilled and seasoned management team support Johnson &
Johnson's overall stability and dependability as a creditworthy organization. These practices ensure that the
company operates with transparency, accountability, and ethical standards. Additionally, Johnson & Johnson's
management team consistently evaluates and adapts to changes in the business environment to maintain its
competitive edge.

Regulatory Adherence and Risk Control

Johnson & Johnson has shown a commitment to compliance by adhering to strict regulatory standards in the
healthcare sector. Good techniques for managing risks include conducting thorough risk assessments,
implementing robust internal controls, and regularly monitoring and reviewing compliance measures. By
prioritizing regulatory adherence and risk control, Johnson & Johnson demonstrates its dedication to ensuring the
safety and well-being of its customers and maintaining the trust of stakeholders

Strong Liquidity
JNJ has easy access to credit markets and a substantial amount of liquidity. During the LTM period ending
March 31, 2019, the company generated $8.8 billion in free cash flow (FCF) thanks to moderate growth and
relatively constant margins. As of March 31, 2019, JNJ had about $14.7 billion in cash on hand.

Debt Structure
As of March 31, 2019, JNJ owed over $28,8 billion. Of that amount, SI.8 billion was due to mature in 2019,
$1.1 billion in 2020, and $1.8 billion in 2021. Fitch anticipates that the majority of the near-term maturities will
be paid down by the company rather than refinancing.

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&Analytics
Variety of Products

The international company Johnson &Johnson (JNJ) offers a wide range of medical items. JNJ is divided into
three primary business segments: consumer health, medical devices, and pharmaceuticals.
Within JN's consumer health division are well-known brands like Visine, Tylenol, and Band-Aid. The wide
range of products includes consumer health items, medical gadgets, and over-the-counter medications, all of
which support the company's significant market presence.
Client Allegiance
Customers of JNJ havea history of being loyal to the company, especially in the consumer health industry. Well
known brands such as Band-Aid and Tylenol are trusted by consumers due to their dependability and efficiency.
The fact that goods like Band-Aid, which have been there for decades, are still in use and have lasted shows how
well JNJ has been able to develop and retain a devoted client base.

Research and Development (R&D)

JNJ is well known for its dedication to healthcare research and development. The business makes significant
investments in R&D to innovate and launch new goods.
Significant R&D expenditures are frequently highlighted in JNJ's annual reports and financial disclosures. The
creation of novel consumer health items, medical gadgets, and pharmaceuticals is evidence of this dedication to
innovation. The organization is able to deliver innovative healthcare solutions because of its robust R&D
network and state-of-the-art technologies.

Access to credit markets and liquidity

JNJ's considerable liquidity and availability to credit markets are signs of its soundness financially and capacity
to fulfil short-term commitments.
The company's liquidity condition is shown through financial statements. JNJ has a history of upholding stable
liquidity ratios and proving its capacity to obtain loans on advantageous terms from the markets.

RISKS
The Company's businesses operate in highly competitive product markets and competitive pressures could
adversely affect the Company's earnings.

The Company faces substantial competition in all three operating segments and in all geographic markets. The
Company's businesses compete with companies of all sizes on the basis of cost-effectiveness, technological
innovations, intellectual property rights, product performance, real or perceived product advantages, pricing and
availability and rate of
reimbursement. The Company also competes with other market participants in securing rights to acquisitions,
collaborations and licensing agreements with third parties. Competition for rights to product candidates and
technologies may result in significant investment and acquisition costs and onerous agreement terms for the
Company. Competitors' development of more effective or less costly products, and/or their ability to secure
patent and other intellectual property
rights and successfully market products ahead of the Company, could negatively impact sales of the Company's
existing products as well as its ability to bring new products to market despite significant prior investment in the
related product development.

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Interruptions and delays in manufacturing operations could adversely affect the Company's business,
sales and reputation.
The Company's manufacture of products requires the timely delivery of sufficient amounts of complex, high
quality components and materials. The Company's subsidiaries operate 85 manufacturing facilities as well as
sourcing from thousands of suppliers around the world. The Company has in the past, and may in the future, face
unanticipated interruptions and delays in manufacturing through its internal or external supply chain.
Manufacturing disruptions can occur
for many reasons including regulatory action, production quality deviations or safety issues, labour disputes,
labour shortages, site-specific incidents (such as fires), natural disasters such as hurricanes and other severe
weather events, raw material shortages, political unrest, terrorist attacks and epidemics or pandemics. Such
delays and difficulties in manufacturing can
result in product shortages, declines in sales and reputational impact as wellas significant remediation and
related costs associated with addressing the shortage.

The Company relies on third parties to manufacture certain of our products. Any failure by or loss of a
third-party manufacturer could result in delays and increased costs, which may adversely affect our
business.
The Comnpany relies on third parties to manufacture certain of our products. We depend on these third-party
manufacturers to allocate to us aportion of their manufacturing capacity sufficient to meet our nceds, to produce
products of acceptable quality and at acceptable manufacturing yields and to deliver those products to us on a
timely basis and at acceptable
prices. However, we cannot guarantee that these third-party manufacturers will be able to meet our near-term or
long-term manufacturing requirements, which could result in lost sales and have an adverse effect on our
business.
Counterfeit versions of the products could harm patients and have a negative impact on revenues,
earnings, reputation and business.

The industry continues to be challenged by the vulnerability of distribution channels to illegal counterfeiting and
the presence of counterfeit products in agrowing number of markets and over the Internet. Third parties may
illegally distribute and sell counterfeit versions of our products, which do not meet our rigorous manufacturing
and testing standards. To distributors and patients, counterfeit products may be visually indistinguishable from
the authentic version. Counterfeit medicines pose arisk to patient health and safety because of the conditions
under which they are manufactured - often in unregulated, unlicensed, uninspected and unsanitary sites - as well
as the lack of regulation of their contents. The industry's failure to mitigate the threat of counterfeit medicines
could adversely impact our business and reputation by impacting patient confidence in our authentic products,
potentially resulting in lost sales, product recalls, and an increased threat of litigation. In addition, diversion of
our products from their authorized market into other channels may result in reduced revenues and negatively
affect our profitability.

The business depends on our ability to recruit and retain talented, highly skilled employees and a diverse
workforce.

The continued growth requires us to recruit and retain talented employees representing diverse backgrounds,
experiences, and skill sets. The market for highly skilled workers and leaders in our industry is extremely
competitive and our ability to compete depends on our ability to hire, develop and motivate highly skilled
personnel in all areas of our organization.
Maintaining our brand and reputation, as well asa diverse, equitable and inclusive work environment enables us
to attract top talent. If we are less successful in our recruiting efforts, or if we cannot retain highly skilled
workers and key leaders, our ability to develop and deliver successful products and services may be adversely
affected. In addition, effective Succession planning is important to our long-term success. Any unsuccessful
implementation of our succession plans or failure to ensure effective transfer of knowledge and smooth

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transitions involving key employees could adversely affect our business, financial condition, or results of
operations.

An information security incident, including a cybersecurity breach, could have a negative impact to the
Company's business or reputation.

To meet business objectives, the Company relies on both internal information technology (IT) systems and
networks, and those of third parties and their vendors, to process and store sensitive data, including confidential
research, business plans, financial information, intellectual property, and personal data that may be subject to
legal protection, and ensure the
continuity of the Company's supply chain. The extensive information security and cybersecurity threats, which
affect companies globally, pose a risk to the security and availability of these systems and networks, and the
confidentiality, integrity, and availability of the Company's sensitive data. The Company continually assesses
these threats and makes investments to increase internal protection, detection, and response capabilities, as well
as ensure the Company's third- party providers have required capabilities and controls, to address this risk. To
date, the Company has not experienced any material impact to the business or operations resulting from
information or cybersecurity attacks; however, because of the frequently changing attack techniques, along with
the increased volume and sophistication of the attacks, there is the potential for the Company to be adversely
impacted. This impact could result in reputational, competitive, operational or other business harm as well as
financial costs and regulatory action. The Company cybersecurity insurance in the event of an
information security or cyber incident; however, the coverage may not be sufficient to cover all financial, legal,
business or reputational losses.

A breach of privacy laws or unauthorized access, loss or misuse of personal data could have a negative
impact to the Company's business or reputation.
Johnson & Johnson faces significant challenges in complying with global privacy and data protection laws,
which encompass a range of obligations related to the handling of personal data. Non-compliance could lead to
severe consequenceses such as substantial fines, legal actions, and damage to the company's reputation. Despite
having established privacy compliance programs, the company acknowledges the ongoing risks associated with
the increasing complexity of data-driven initiatives, involvement of multiple vendors, and potential threats to
data security, all of which could adversely impact its business operations and research activities