Risk Management

To ensure business continuity and maintain a stable management base, we have positioned risk management as a management priority and are promoting relevant initiatives. The risks a company faces are becoming increasingly diverse and complex. If any of these serious risks materialize, not only could the group’s management resources be damaged, but there may be harmful consequences for business continuity. This could include damage to the relationship of trust built with customers and business partners, as well as loss of social credibility. In order to respond to these risks, we have established a system to identify the possibility and potential impact of the occurrence of such risks and to ensure the implementation of measures to prevent the manifestation of such risks. We have also put measures in place to deal with such risks in the event that they do materialize.

In order to identify various risks related to the management of the group, the Executive Sustainability Committee, with ultimate responsibility held by the president, approves annual activity plans related to risk management and confirms the progress of these plans on a quarterly basis. The Risk Management Meetings, under the auspices of the Executive Sustainability Committee, are chaired by the general manager of the Finance & Administration Division, and members identify, analyze, evaluate, and prioritize risks as well as formulate measures to address specific risks. In the event that a risk with a significant negative impact on the group’s management or business arises, a Crisis Management Committee, with ultimate responsibility held by the president and chaired by the executive officer in charge of Administration, Planning & Sustainability, will be established. The committee will be tasked with rapidly and appropriately dealing with the emergency situation, minimizing or preventing damage, restoring normalcy, and putting countermeasures in place.

The group is addressing issues such as responding to revisions of laws and regulations, transaction risks, disaster and crime prevention, IT controls, strengthening of information security, and enhancing effectiveness of compliance activities. As part of our risk management activities, we have begun conducting risk assessments of current conditions and are using experts to help identify and analyze current risks and prioritize issues. Based on the results of the assessments, we plan to strengthen the risk management system of the entire group by informing each division and group company of the measures they need to take. We will also periodically check the progress of initiatives.