The Osaki Group promotes activities aimed at preventing and mitigating risks to ensure the continuous and stable development of its business, while also working to minimize damage and enable swift recovery in the event of a crisis.

Basic policy

The basic policy shows a commitment to the continuous and stable development of the business by identifying and evaluating risks in advance and taking countermeasures.
Risk management identifies, evaluates and minimises latent risks in daily work operations, and crisis management is used to minimise the effect of disruptive and unexpected events and get back on track.

Guidelines

The following action guidelines have been established in line with the basic policy.

  1. The highest priority is on ensuring the quality and safety of products and services. To that end, we strive to eliminate and mitigate factors that adversely affect all stakeholders.
  2. We are a committed supplier of products and services that are widely used throughout society. We provide a stable supply of products and services.
  3. Officers and employees obey laws, rules and regulations in a spirit of compliance, and act ethically based on their best judgment.

Process

The OSAKI Group has established a Compliance Committee to promote risk management aimed at supporting the continuous and stable growth of the Group. The Committee identifies and evaluates risks that could impede business activities and implements appropriate countermeasures. It also works to prevent risks from occurring and to minimize their impact should they arise. 

 

Risk management is performed according to the following procedure:

 

  1. Risk identification
    i. Identify actual or potential risks that could affect business continuity across departments, factories, business sites, and OSAKI Group companies.
    ii. Compliance, quality, environment, product liability, export and control committees each identifies actual and potential risks.
  2. Risk analysis and evaluation
    i. Each department and committee evaluates the impact and possibility of occurrence of each identified risk and creates a risk map.
    ii. A company-wide risk map is created based on the risk maps submitted by each department and committee.
  3. Response to risk
    i. Take measures to avoid, reduce and control evaluated risks.
    ii. Establish an emergency response plan when risks become apparent.

 

The same process is also applied to new business initiatives to identify, assess, prevent, and mitigate business risks associated with such operations.

● Main Business Risks

1. Demand Fluctuations
  • Disruptions in regional political or economic conditions, or changes in policies
  • Declines in performance of key customers, or revisions to their strategies and capital investments

2. Price Competition
  • Significant declines in sales prices
  • Large-volume sales below anticipated pricing

3. Supply Chain

(1)  Procurement of materials

  • Impact on production activities due to difficulty in procuring materials
  • Accumulation of excess materials caused by reduced demand, etc.
  • Negative economic impact from additional U.S. tariffs

(2) Cost Increases

  • Rising material costs due to currency fluctuations, inflation, and other factors
  • Surging energy prices
  • Increased logistics costs

4. Overseas Business
  • Geopolitical risks, including economic conditions, conflicts, or terrorism
  • Rapid market changes or project delays

5. Foreign Exchange Rates
  • Fluctuations in revenue and assets of overseas subsidiaries

6. Product and Service Quality
  • Product recalls, replacements, or claims for damages

7. Research & Development Risks
  • Delays in development or shortages of engineers 
  • Infringement of intellectual property rights
  • Claims for damages or litigation arising from intellectual property infringement
● Main Management Risks

1. Compliance

(1) Compliance risks The main management risks are as follows.

  • Violations of laws and regulations
  • Deviations from social norms or corporate ethics
  • Reputational risks, etc.

2. Human resources and labor

(1) Labor management

  • Long working hours 　
  • Harassment (interpersonal) 
  • Mental health issues
  • Spread of infectious diseases, etc.

(2) Safety management

  • Occupational accidents
  • Accidents while driving company vehicles, etc.

(3) Talent-related issues

  • Recruitment challenges
  • Training gaps (age distribution imbalances, etc.)
  • Employee turnover, etc.

3. System failures and information leaks

(1) System failures

  • Hardware malfunctions
  • Data loss
  • Interruptions to business operations (e.g., financial closing), etc.

(2) Information security risks

  • Information leaks
  • Malware infections (financial damage)
  • Unauthorized access
  • Improper or negligent operations
  • Data tampering, etc.

4.  Climate change, extreme disasters, infectious diseases, etc.

(1) Climate change, extreme disasters, infectious diseases, etc.

  • Earthquakes
  • Natural disasters, abnormal weather
  • Infectious diseases, etc.

(2) Business continuity (infrastructure and production)

  • Interruptions to business operations resulting from the above, etc.

Information security management

Recognizing the importance of information assets, the OSAKI Group considers it has a social obligation to protect information.
The energy management department has an information security management system (ISMS) to protect customer and corporate information assets from tampering, leakage and loss, and to quickly provide required information. If an information security incident does occur, the damage can be contained, recovery is quick and recurrence prevented. In 2017 the ISMS received ISO/IEC 27001 certification. The system ensures the confidentiality, integrity and availability of important information assets and their continued effectiveness.