Idemitsu Group strives to stabilize its management by proactively recognizing and evaluating various risks associated with its business activities and taking appropriate measures in accordance with those risks. At our group, we classify risks associated with our business activities into two categories: “Operational Risk” and “Business Strategy Risk” and promote countermeasures against them. “Operational Risk” is the risk of an impediment to business execution that causes losses and yields no profit. Risks under this category are typified by accidents, disasters, non-compliance, business errors, product defects, customer complaints, environmental pollution, system failures, terrorism, and labor problems. The term “Business Strategy Risk” refers to risks associated with business activities that exclude “Operational Risk” and significantly affect profit or loss. In addition to risks associated with current business strategies such as investments and finance, this category includes risks associated with the future business environment.
The Enterprise Risk Management Committee, which is supervised by the Board of Directors, handles “Business Strategy Risk” and is tasked with the determination of risk management policies associated with Group operations and monitoring the status of risk management. With the President serving as chairman, committee members mainly consist of Executive Officers and heads of relevant divisions. In principle, this committee meets once every six months and requests reports from other committees with regard to major risks categorized under “Operational Risk” or “Business Strategy Risk.” Also, the committee provides the Board of Directors with updates on the status of its activities once a year in principle.
Our group has established the “Risk Management and Compliance Committee” tasked with handling “Operational Risk” and is promoting company-wide risk management by taking necessary measures in a timely and prompt manner. The committee chairman is appointed by the Management Committee from among the Directors or Executive Officers, while committee members consist mainly of the Executive Officer in charge of general affairs as well as heads of General Affairs, Safety Environment & Quality Assurance, Finance & Accounting, Legal, Corporate Planning, Human Resources, and Public Relations departments. The committee holds periodic meetings on a quarterly basis to specify major risks for the entire Group, formulate countermeasures, and identify signs of their emergence while assessing novel types of risks. In addition to deliberating on these and other matters related to the management of Operational Risk, including measures for risk prevention and managing the progress of such measures, the committee is responsible for submitting its conclusions to the Enterprise Risk Management Committee.