Risk Management

Risk Management

Basic ideas and policies

The Showa Denko Group upholds “Deepening of risk management on the basis of safety and compliance” as the main theme for its CSR Policy. Accordingly, we are striving to improve our risk control for both ordinary times and emergencies and to reduce the detected risks.

Promotion system

We have working groups specializing in important issues related to compliance and risk management, specifically, the working group on risk management and the working group on human rights and compliance. At the meetings of the Sustainability Promotion Council chaired by the director in charge of CSR, relevant issues are deliberated and examined, and the issues of importance in terms of business management are presented to the Management Committee and the Board of Directors as the agenda for their meetings. In ordinary times, each of the divisions, plants and subsidiaries implement their risk management systems and risk reduction measures under the leadership of their respective risk managers, thereby promoting the sectoral control of risks.
In the event that an existential risk to the company is identified or an unexpected crisis occurs, we will establish headquarters to deal with the crisis headed by the President so that we can promptly respond to it. We have also set the rules to be followed by the administrative departments of the head office regarding risks related to personnel, PR and safety. Issues regarding the risk management situation are deliberated by the Management Committee twice a year and the results are reported to the Board of Directors for continuous improvement. We thereby ensure that our risk management process functions effectively.

“Risk inventory” activity

The Showa Denko Group conducts the “risk inventory” activity as its standard risk management scheme, and all 96 of the Group’s sites, including non-consolidated subsidiaries, are targeted for the activity. In this activity, specific risks are identified at the sites by department and according to our risk classification criteria. Through the ISO 31000-compliant risk assessment, response and review process, we are executing a PDCA cycle for risk management, thereby making all employees well aware of the importance of risk management and ensuring that the management team can constantly monitor and grasp information about the risks that could have serious impacts on the Group’s management. As for serious risks for which adjustments need to be made to implement company-wide measures, such as anti-earthquake measures for equipment and information security measures, the head office’s administrative departments in charge provide needed advice. They also offer risk-related education and training, carry out on-site inspections and give instructions, as required, under the leadership of the management team.

■ Cycle of the risk inventory activity

Enhancement of business continuity plans (BCPs)

We at the Showa Denko Group are aware of the importance of fulfilling our responsibility as a supplier, recognizing the fact that the availability of our products has an impact on society at large. While expanding our business domain, we have been making BCPs based on the idea that we need to build a business system that is highly resistant to disasters and other crises both in Japan and overseas.
We make specific BCPs in consideration of the features of each of our businesses and products, implement natural disaster countermeasures for our equipment, stockpile masks and other goods in preparation against pandemics and clarify and work on problems through educational training. We are thereby managing our business in a manner that enables us to continue it while giving first priority to people’s lives. Moreover, we regularly conduct drills to foster collaboration for BCPs between the divisions, plants and affiliated companies, through which participants can share the lessons learned, problems and best practices.
As one of the initiatives implemented in 2019, we revised the BCP made for the head office’s administrative departments. In the event of an inland earthquake hitting the Tokyo metropolitan area, we might not be able to continue using the head office building in Tokyo. Based on this assumption, we revised the plan to include the relocation of the emergency response headquarters functions and the adoption of a teleworking system as the basic countermeasures.
As for the outbreak of the novel coronavirus disease (COVID-19), the secretariat of the emergency response headquarters collect related information from both within and outside Japan to provide regular cautionary advice to employees and instruct them on infection control measures. Moreover, the Group CEO shared a message promising employees that the Group will: (1) give first priority to protecting the health of all Group employees and employees of partner companies; (2) continue to supply the products that are indispensable for society and daily life as its social responsibility; and (3) make preparations to achieve further growth for the Group after the pandemic ends. We are dealing with the coronavirus crisis also in line with the BCPs.

Information security measures

The Showa Denko Group has established rules on information security and the management of personal information in order to make appropriate responses to information-related risks. The Group is continuously working to increase employees’ awareness of the rules through e-learning and training against targeted email attacks. We also make information security assessments at all our sites in Japan and abroad as part of our activity to increase our information security.
Recently, in our effort to deal with cyberattacks, we have participated in the activities conducted by the Japan Chemical Industry Association and the Japan Petrochemical Industry Association to collect the latest information. Since 2018, we have also been engaging in the Computer Security Incident Response Team (CSIRT) activity to enhance the information security systems of our sites in Japan and across the world, cooperating with external organizations specializing in information security for information collection.

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