Risk Management
The Kyocera Group's business environment involves volatility, uncertainty, complexity, and ambiguity, driving the need to review our supply chain to shore up economic security amidst the decoupling of the world's economies.
The Kyocera Group will strive to reinforce our management foundation and achieve sustainable growth by pursuing risk management, compliance, and BCP activities essential for survival in these uncertain times.
Risk Management Initiatives
The Kyocera Group is making group-wide efforts to reinforce its risk management system to cope with global risks that are becoming more complex. The Kyocera Group faces various risks that may affect the credibility or business sustainability of the Kyocera Group, including changes in the market environment, the occurrence of natural disasters, incidents and accidents, the impact of climate change, information security, stoppages and deficiencies in labor conditions in the supply chain, and violations of human rights. To cope with these issues, the Kyocera Group endeavors to reduce and mitigate risks while implementing countermeasures through the Business Continuity Plan (BCP) and acting on the Basic Policy on Risk Management put in place for this purpose.
Kyocera Group Basic Policy on Risk Management
- In accordance with assurance of compliance and the spirit of the Kyocera Philosophy, the group will consider what is the right conduct as a human being and act based on the value standards.
- In accordance with the spirit of the Kyocera Philosophy, the group will accept "the highest priority is to ensure safety of bodies and lives of people," deal with crisis, and for convergence of crisis, cooperate among employees as a unit to minimize loss, recover the damage, and make efforts to prevent reoccurrences, thereby attempting to remove or mitigate impediments to the interests of each stakeholder (the interested party), including customers, business partners, shareholders/investors, and the community.
- The Kyocera Group will attempt to continuously develop its business through implementing risk management.
- The group will act with its social mission to stably supply products and services helpful to the progress and development of society.
Risk Management System
The Kyocera Group reformed its Risk Management Committee in June 2022 and holds meetings periodically to determine risk management policies, identify corporate risks, assign risk owners, and review risk-handling progress. Items discussed at the Risk Management Committee are reported to the Board of Directors, and policies are shared among departments responsible for risks, factories, branch offices, and Group companies. We also established a Risk Management Division in April 2023 to reinforce our risk management structure.
Organization Chart of Risk Management
Risk Management Process
Kyocera implements risk assessments to recognize, analyze and evaluate major risks. In addition, Kyocera also analyzes and evaluates risks that have been paid attention in reports by external experts, etc. Among the major risks within Kyocera Group and the risks that have been paid attention in the external environment, we identify corporate risks that have a particularly significant impact on management and need to be addressed and promote the following PDCA cycle by implementing risk measures, reviewing and improving risk measures.
Corporate Risk Management Process Flow
Corporate Risk
Corporate risks and countermeasures identified through the risk management process are as follows:
| Risk Classifications | Specific Risk Details | Main Countermeasures |
|---|---|---|
| Risks related to International Business Activities |
●Risk related to unexpected changes in laws and regulations regarding economic security policies, investment regulations, product import and export restrictions, and/or restrictions on repatriating profits, due to political, geopolitical, or economic factors affecting international business operations |
●Establish an economic security project to enact risk prevention measures such as the monitoring of international risks ●Collect information about changes in regulations regarding investment and profit repatriation, and take all necessary measures |
| Risks Regarding Human Rights |
●Legal and/or reputational risk related to changing laws and regulations regarding human rights both at the Group companies and in supply chains |
●Respect human rights of all stakeholders associated with the Kyocera Group, including employees, customers, shareholders, investors, and business partners, and take action to reduce or eliminate any human rights risks ●Comply with EU Conflict Minerals Regulations and other legal requirements; survey, evaluate and take corrective measures for risks related to conflict materials and human rights violations. ●Join the Responsible Business Alliance; conduct human rights due diligence on supply chain, and provide education about the prohibition of harassment and discrimination |
| Risks Regarding Information Security |
●Risk of damages from information leakage, falsification, loss, or business interruption due to hardware or software failure or cyberattack ●Risk of additional cost for information security in response to new requirements related to technical innovation and customer demands ●Reputational risk and loss of business competitiveness caused by information breach, loss or hacking |
●Improve rules regarding information security ●Provide education to employees, enhance security measures for networks and IT assets, and reinforce business continuity plans (BCP) to establish rapid recovery measures |
| Risks Regarding Barriers to the Hiring of Excellent Human Resources |
●Risk of becoming unable to fulfill human resource requirements due to fierce labor market competition and shrinking labor pool ●Risk of becoming unable to maintain current human resources by not improving work-life balance, or not promoting diversity and social inclusion |
●Secure adequate human resources with an eye on the future, including further expansion outside Japan, and salary levels adjusted to local labor markets and inflation rates ●Improve work-life balance; promote diversity and inclusion; implement flexible work systems |
| Risks Regarding Earthquakes and Other Natural Disasters |
●Risk to business from large-scale disasters caused by earthquake, typhoon, heavy rain, flooding or other inevitable natural disasters, equipment failure, and/or human error ●Risk to financial performance and business results from direct damage caused by disaster, and/or economic harm caused by impaired market conditions resulting from disaster |
●Develop BCP structures that model earthquakes and other natural disasters, as well as large-scale disasters caused by equipment failures or human error; prepare countermeasures in advance ●Create disaster-response plans to ensure early recovery and supply-chain alternatives; conduct BCP education and training |
Please see the annual report (pdf/1,814KB) for details on risks and major countermeasures.
Promotion of Risk Crisis Management
The Kyocera Group has in place the Basic Guidelines for Crisis Management to promote risk management measures. Based on these Guidelines, we formulated the Risk Management Manual that stipulates actions to take to ensure the safety of employees working at overseas sites in the event of a terrorist attack and various other emergency situations.
Cooperation Among Related Divisions when Incidents Occur
To appropriately handle risks surrounding the Kyocera Group, the company provides prompt initial responses to mitigate impact and ensure early business recovery. Each department responsible for risks develops and maintains the emergency response system and establishes emergency headquarters when necessary. For example, if a cybersecurity incident were to occur, Kyocera would initiate the emergency response system in cooperation with the relevant divisions based on the emergency response rules to coordinate announcements, report to the proper authorities, and conduct surveys depending on the specialty of individual departments.
Corporate Motto / Management Rationale
- Our Thoughts on Sustainability Activities
- Top Management Message
- Kyocera Group's Value Creation Model
- Sustainability Management
- Kyocera Group CSR Guidelines
- Stakeholder Engagement
- Environmental Safety Policy / Targets and Promotion System
- Measures to Fight Climate Change -Information Disclosure Based on TCFD Recommendations-
- Water Risk Response
- Recycling Activities
- Initiatives to Prevent Environmental Pollution
- Conservation of Biodiversity
- Environmentally Friendly Products / Green Procurement
- Environmental Communication
- A History of Our Environmental Protection Activities
Social Citizenship Initiatives
- The Kyocera Group Human Capital
- Respect for Human Rights
- DEI Promotion
- Occupational Safety
- Occupational Health, Safety, and Fitness Initiatives
- Supply Chain Management
- Approaches to Raising Quality and Customer Satisfaction Levels
- Social Contribution Activities
- Academic Advancement and Research
- Support for Culture and the Arts
- International Exchanges and Collaboration
- Environmental Protection Activities
- Local Community Activities
- Social Welfare Activities
- Contributions to Society through Business Activities
Relevant data
- ESG Data Sheets
- Third Party Assurance of Environmental and Social Data
- Promoting Digitalization
- Innovation Management
- Integrated Report
- Employees Creating the Future
- GRI Standards Comparison Table / SASB Index
- Editorial Policy
- Participation in Sustainability Related Initiatives & External Evaluation
- News & Announcements