Enterprise Risk Management
Key Philosophy and Activities
The JVCKENWOOD Group recognizes risk management as an important management issue. We regard risks as " factors that could inhibit the achievement of business plans" and have implemented measures to clearly recognize risks at all workplaces throughout the world. The Group regularly identifies risks faced by all its business sites around the world to recognize them clearly, set issues to tackle to prevent the realization of the identified risks and minimize their impact or damage, and resolve those issues systematically.
For risks that could have a company-wide impact, we are taking a management-led approach.
We consider that the most effective corporate response to risks is to identify them correctly in the course of our day-today corporate activities, understand the problems in reducing risks, and have all our business sites around the world collaborate with management to resolve those problems. With these efforts, we will continue to contribute to promoting sustainability activities with the aim of ensuring sustainable growth and enhancing our corporate value.
Risk Management System
The risks* in the business environment surrounding the JVCKENWOOD Group are increasingly diverse and complex, and the Group has established a risk management system to formulate and implement enterprise-wide risk mitigation measures. The Chief Executive Officer is directly responsible for this system.
The Group's risks management process operates on the cycle described below (see diagram).
1. Implementation of an annual Risk Surveillance Process at business sites around the world to identify the risks confronting the workplace, quantitatively assess their importance, formulate responses, and monitor progress.
2. Regular meetings of the Enterprise Risk Management Conference under the chairmanship of the director in charge of risk management. The Conference investigates risks, management issues, and operational issues highlighted in the Risk Surveillance Process as difficult for individual units to deal with, and identifies those that require enterprise-level perspectives and solutions in light of their impact on business, urgency, and degree of incidence. It then formulates measures for their solution, assigns a responsible Officer, and monitors progress. The Conference is supervised by the Board of Directors and regularly reports to the Board on the status of significant risks, risk-related matters requiring further investigation, and other matters for deliberation.
3. Implementation of a kaizen cycle by the Officer assigned responsibility for a significant risk. This cycle is used to deploy measures to business units and regions as initiatives to be achieved during the current consolidated business year.
From FY 2021 to FY 2022, we selected supply chain management and enhancement of information security as important risks along with business and financial risks, and appointed an executive officer in charge as a responsible person. The Board of Directors also receives reports on the status of responses to the identified important risks, and these are appropriately managed and supervised.
Image of risk management structure
Business Continuity Management (BCM）
Numerous risks confront our business, the risk of earthquake and other natural disasters, the spread of infectious diseases, and global expansion of terrorisms among the most pressing. In the face of these risks, JVCKENWOOD's first priority is to preserve human life, but it also bears a responsibility to its stakeholders to have systems in place that will enable it to continue to provide products and services. The Group has articulated basic policy for business continuity in its Business Continuity Plan (BCP), which serves as the foundation for its Business Continuity Management (BCM). BCP-related units work actively to refine the plan in a PDCA cycle, conducting BCP exercises to identify issues and revising the BCP accordingly. One example is infectious diseases. As the Covid-19 pandemic continued across the globe in 2021, the Company updated its infection control manuals and other existing materials, took measures to prevent the spread of the disease, and worked to minimize its impact and ensure the continuity of business. To enhance risk management in its international activities, it worked in collaboration with local production centers and sales companies to conduct desktop exercises involving ESG incidents during emergency situations and develop manuals covering the issues identified. One result these efforts was the swift, smooth evacuation of personnel at the early stages of the Russia-Ukraine crisis.
Basic policy on Business Continuity Plan (BCP)
Contribute to the security and safety of society through sustained business operations by promptly restoring business activities after an emergency occurs.
In March 2017, JVCKENWOOD received certification from the Association for Resilience Japan based on the guideline issued by the National Resilience Promotion Office, Cabinet Secretariat, as a business operator contributing to the building of national resilience against disasters (Resilience Certification) in recognition of its endorsement of the objective of promoting the building of national resilience and active engagement in efforts related to business continuity. As a result of ongoing activities of disaster prevention and mitigation and business continuity plans (BCPs) for two years, we passed the renewal examination after the review of the documents on its improvements and interview with our executive on March 29, 2019. JVCKENWOOD will continue to work to further enhance the quality of BCM in the future.
Certification as Organization Contributing to National Resilience (Resilience Certification)
Registration Certificate (obtained on March 31, 2017, updated on March 31, 2021)
Climate Change Risk Management
The JVCKENWOOD Group recognizes climate change as a risk to its business operations and implements company-wide climate change initiatives aimed at mitigating this risk under the leadership of the Sustainability Management Office at its Head Office and general affairs departments of JVCKENWOOD and its affiliates.
See the page linked below for specific initiatives.
Addressing Climate Change
*In addition to foreign exchange fluctuations, international taxation, geopolitical risks, emerging country risks, large-scale disasters, procurement, intellectual property lawsuits, etc., a wide range of risks are also covered such as human rights issues, information security and climate change, which have been increasingly recognized as risks in recent years.