25.5. Share price risk

The Group is exposed to share price risk arising from cash-settled share-based payment plan (see Note 17.2). The Group hedges its exposure entering into stock options, under which the Group has right to receive cash if OPL S.A. share price exceeds certain level. As a result, the gains/losses generated by derivative instruments compensate the losses/gains on the hedged item. As at 31 December 2020 and 2019, 100% of cash-settled share-based payment plan was hedged.

Hedge ineffectiveness may arise from a difference in the strike price of the hedged and hedging items, various types of hedged and hedging instruments and a difference between counterparty credit risk and own credit risk.

The sensitivity analysis prepared by the Group indicated that the potential gains/losses resulting from a reasonably possible change of OPL S.A. share price would have an insignificant impact on the consolidated income statement and other reserves as at 31 December 2020 and 2019.