Risk Management

Approach to Risk Management

As we conduct a wide range of business activities throughout Japan and on a global level, we believe that a solid risk management system is essential for capturing business growth opportunities and implementing our strategies. In formulating long-term management strategies and medium-term management plans, we identify multiple opportunities and risks that we recognize in each segment and closely monitor them as we conduct our business activities. We also engages in various initiatives such as formulating measures to offset risks. In addition, the Total Risk Management Council, which is chaired by the Company president, has been established to control risk management activities. We aim to continuously improve our sustainable corporate value by appropriately managing various risks that may affect our earnings from a short-term perspective and medium- to long-term perspective.

Total Risk Management Council

In accordance with the basic policies established by the Board of Directors, the Total Risk Management Council identifies risks associated with business activities and formulates/promotes a risk management plan to prevent risk events from materializing or to minimize possible loss. Total Risk Management Council meetings are held regularly once a month to promote preventive risk management by compiling drafts of risk management plans prepared by each division for each fiscal year and then formulating the Company-wide Risk Management Plan. Total Risk Management Council members are appointed by the chairman after discussions are held by the Management Council. Executive Officers of Nippon Koei are obliged to conduct risk management related to the assigned duties each was given. Total Risk Management Council members consist of individuals who are at the Executive Officer level or above.

The Total Risk Management Council meetings implement PDCA (Plan-Do-Check-Act) cycle in the form of identifying and monitoring risk items and reviewing the progress of countermeasures. When a significant risk event becomes apparent, we conduct a self-assessment of the risk management plan, take necessary measures and improvements, and reflect them in the risk management activities of each division. The state of risk management at Group companies is also reported to the heads of each division.

Process for responding to apparent risk

Business Continuity Initiatives

If we do not have adequate countermeasures for natural disasters, including earthquakes, windstorms, floods, as well as for epidemics and outbreaks of infectious diseases, it is anticipated there is a risk that we will be forced to suspend operations for a long period of time, which could result in significant losses that would have a major impact on our stakeholders. As a company involved in the social infrastructure that supports people's daily lives, we believe that it is our social responsibility to continue to provide stable services. Therefore, we have established a business continuity plan and are working to create and periodically review rules for responding quickly and appropriately in the event of a crisis.

In accordance with those rules, the Total Risk Management Council centrally manages the collection of information on disasters, accidents, incidents, and other crises that have occurred in Japan and overseas as well as the responses to them.

Responses to Major Risks Identified