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Risk Management/Compliance

Risk Management

Risk Management in General

The Nabtesco Group has a system in place to ensure that profits and losses, capital efficiency, quality issues, extraordinary accidents and other matters concerning the execution of business operations are reported to the Board of Directors appropriately and in a timely manner, thereby detecting risks at their early stages and minimizing losses.

In FY2017, to properly implement risk and crisis management at the Nabtesco Group and to maintain and improve its corporate value, we conducted risk assessment on Nabtesco and the group companies in Japan according to the risk management rules, which were overhauled in FY2016, and the detailed rules on risk management.

Given that risks faced by corporations have been multiplying and becoming increasingly diversified, we identified serious Group-wide risks based on the results of the risk assessment and discussed the countermeasures to address them at a meeting of the Risk Management Committee, which was established in FY2016 as a forum for Group-wide risk management activities for prompt actions.

In FY2017, we managed the following types of risks and prevented losses.

  1. Risks relevant to the economy and markets
  2. Risks relevant to overseas operations
  3. Risks relevant to large-scale disasters
  4. Risks relevant to exchange rate fluctuations
  5. Risks relevant to procurement
  6. Risks relevant to product quality
  7. Risks relevant to competition
  8. Risks relevant to information security
  9. Risks relevant to intellectual property
  10. Risks relevant to laws, ordinances and regulations
  11. Risks relevant to environment
  12. Risks relevant to corporate acquisition etc.
  13. Risks relevant to impairment loss of fixed assets

We also ensure the rationality, appropriateness and legality of decision-making and manage risks through compliance with, and thoroughgoing implementation of, the Group regulations for responsibility and authority. We have also established company regulations that set forth reporting procedures in the event of accidents, disasters, critical quality problems and other incidents that may have a seriously negative impact on the Group’s business results, financial standing or credit. We thus have established a prompt and proper information communication and emergency response system in case of a contingency.

With regard to monitoring, expert members at the Headquarters, such as the Business Auditing Department, conduct cross-organizational audits of operational risk management and offer necessary and appropriate advice with regard to operational improvement.

Corporate Communications Department, Compliance Promotion Department, 1, 2

Risk Management Activities of the Group

In response to the globalization of our business operations, we are fostering activities to identify a range of risks faced by our business sites in Japan and overseas, and to prevent the materialization of serious risks.

In FY2017, based on the risk management rules and the detailed rules on risk management, we conducted a risk assessment related to 11 domestic group companies in the Nabtesco Group. Based on the results of this risk assessment, we will formulate and implement priority measures to address serious Group-wide risks identified by the risk assessment committee, based on the expertise of each department in charge of risk. We also continue efforts to raise awareness by covering risk management issues in compliance newsletters.

In addition, the risk management committee decided to conduct a yearly risk assessment on all companies of the Nabtesco Group both in and outside Japan from the following fiscal year (risks of domestic group companies and those of overseas group companies used to be assessed alternately every other year).

Corporate Communications Department, Compliance Promotion Department, 1, 2

Business Continuity Plan (BCP) Activities

To prepare for major natural disasters such as large earthquakes and other contingencies, the Nabtesco Group has been fostered activities to create BCPs since FY2010.

Risks faced by business sites were assessed in FY2015. The risk assessment on in-house companies and domestic Group companies revealed that natural disasters posed the greatest risk against the continuation of our business due to possible damage to facilities of Nabtesco and its suppliers. It therefore became imperative that BCPs be reviewed and enhanced.

In FY2016, the office responsible for promoting Group-wide BCP efforts was transferred out of the Compliance Division and put under the supervision of the Production Innovation Division. This change prompted the establishment of a business continuity system for our entire production activities, the revision of policies, and the identification of issues to increase the effectiveness of BCPs.

In FY2017, we started a review of BCP systems for major factories in Japan. Additionally, to ensure that critical materials required for production can be purchased stably, we started efforts for BCPs for procurement, with an eye to mitigate risks associated with supply chains in an emergency.

In FY2018, to stimulate the activities for BCP, which tend to stagnate, the office for BCP was set up at each business base. The move to reform BCP with an emphasis on effectiveness was launched with the cooperation of those regional offices and the Proburement Planning Department of the head office.

A certificate of an organization contributing to national resilience (Acquired 30th manufacturing industry in Japan)A certificate of an organization contributing to national resilience (Acquired 30th manufacturing industry in Japan)

In addition, a certificate of an organization contributing to national resilience (certificate of resilience) from the Cabinet Secretariat of Japan, which shows the national government's recognition of the effectiveness of a BCP, was received by the BCP of the plant in Iwakuni of TOYO JIDOKI CO., LTD. This news was publicly announced. (It is the first company in Yamaguchi Prefecture to obtain this certificate.)

Based on this achievement, we will make efforts to ensure the effectiveness of BCPs so that the said certificate will also be given to all major business bases of the Nabtesco Group.

Corporate Communications Department, Compliance Promotion Department, Procurement Planning Department, 1, 2
Risk Management/Compliance
Risk Management

Risk Management in General

The Nabtesco Group has a system in place to ensure that profits and losses,...

Risk Management/Compliance
Risk Management

Risk Management Activities of the Group

In response to the globalization of our business operations, we are fosteri...

Risk Management/Compliance
Risk Management

Business Continuity Plan (BCP) Activities

To prepare for major natural disasters such as large earthquakes and other ...

Risk Management/Compliance
Compliance

Rules Surrounding Compliance

Establishment of the Nabtesco Group Code of Ethics To strengthen the Gro...

Risk Management/Compliance
Compliance

Fostering Compliance Awareness

Compliance Training for Employees Breakdown of Position-Specific Tra...

Risk Management/Compliance
Compliance

Information Dispatch and Enlightenment Activities

Corporate Ethics Month Poster for Corporate Ethics Month in FY2017 ...

Risk Management/Compliance
Compliance

Global Expansion of Internal Reporting System (Hotline)

We have established a “hotline” system for the purpose of preventing, disco...

Risk Management/Compliance
Compliance

Anti-Corruption Measures

Initiatives on AntiCorruption Measures We have the Nabtesco Grou...

Risk Management/Compliance
Compliance

Prevention of Bid Rigging

Measures implemented to prevent bid rigging To ensure compliance...

Risk Management/Compliance
Compliance

Compliance Committee Message from Outside Corporate

Zenzo Sasaki, Outside Corporate Auditor (Attorney at Law, Harumikyow...