Risk Management

Our group has the Risk & Compliance Committee (RC Committee) in place as the governing body for compliance with laws and regulations, our articles of incorporation, and corporate ethics, and to establish a risk management system. The committee discusses matters important in terms of risk and compliance, and then determines policies. Individual risks are controlled and addressed by responsible departments under the RC Committee's supervision.

Risk and compliance management system

The Toyo Tanso Group is furthering risk management activities by establishing the Risk & Compliance Committee as an organization that will oversee the risk management activities of the entire Group. The Committee consists of members appointed by the Representative Director from among Group directors and executive officers together with an administrative office.
Meetings of the Risk & Compliance Committee are held quarterly. The Committee conducts continuous monitoring activities that include identifying, calculating, and evaluating risks, determining which risks to prioritize in risk management and the departments responsible for handling them, and compiling reports from each responsible department and affiliated companies based on a list of risk and compliance management items. The Committee also provides reports to top management.

Risk and compliance management system

Risk and compliance management items

We conduct a survey once every three months using our list of risk and compliance management items so that we may centrally manage the Toyo Tanso Group's risk response situation. Risks consisting of 12 items at the major classification level and 49 items at the sub-classification level are selected for the list of management items.

Risk and Compliance Management Items List
Major ClassificationsSub-Classifications (Excerpt)
1Disaster and accident risksNatural disasters such as typhoons, floods, earthquakes, tsunamis, lightning strikes and volcanic eruptions, explosions, fires, lifeline supply interruptions, workplace accidents, health hazards, pandemics
2Information security risksLeakage or misuse of confidential information, equipment failure, system failure, leakage of personal data
3Damage risks caused by crimeTerrorism, bombing, arson, occupation, threats and extortion by anti-social forces, criminal offences such as theft and etc.
4Personnel and labor risksDeath or injury of officers and employees, labor dispute, human rights violations (child labour, discrimination, etc.) and harassment, exodus of talented people, personnel shortage
5Judical(Legal) risksM&A, violation of antitrust laws (cartels, bid-rigging, etc.) and subcontracting laws, import/export controls, insider trading、whistleblowing
6Intellectual property risksInfringement of intellectual property rights, technology leakage
7Product quality risksProduct accidents (product liability issues), quality defects, recalls
8Finantial risksOverstocking, Understocking, bankruptcy and insolvency of financial institutions, interest rate and currency fluctuations, window dressing
9Environmental risksEnvironmental regulations, trouble managing chemical substances contained in products, climate change (TCFD, carbon tax, significant increase in greenhouse gas emissions, etc.), hazardous material/hazardous substance leaks, water pollution, soil pollution, air pollution
10Procurement risksInappropriate raw material procurement planning, inability to procure raw fuel, parts, etc., human rights violations in the supply chain (child labour, discrimination, etc.)
11Sales risksUncollectible accounts receivable, the accrual of bad debt、 legal disputes in business transactions (customer claims, troubles, etc.)
12Other risksCountry risk, reputational damage, trouble with local residents and society

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