Social Responsibility
About
Risk Management
To prepare for the various types of risks encountered in our business activities, we have implemented risk management systems, including plans to ensure continuity of business operations even in a time of disaster.
Initiatives for Managing Predictable Risks
We have reformed our risk management system as part of an innovative internal control enhancement program.
As part of our efforts to strengthen internal controls, the Konica Minolta Group established the Risk Management Committee with the aim of maximizing the group's profits while minimizing losses by ensuring rational decision-making in regard to risk management initiatives.
The Risk Management Committee is chaired by an executive officer appointed by the Board of Directors of Konica Minolta Holdings, Inc. The committee members are executive officers responsible for various functions of Konica Minolta Holdings and presidents of its business and common function companies.
To ensure effective operation of the Risk Management Committee, we have formed two subcommittees: the Business Risk and the Crisis Management subcommittees. In both subcommittees, members discuss practical measures to realize their objectives.
The Business Risk Subcommittee implements overall risk management for the business plan.
The Business Risk Subcommittee supports the efforts of establishing and fortifying systems for managing risks involved in implementing the "Forward 08" medium-term plan and annual budget. The subcommittee also supports the management of risks associated with business strategies, including growth strategies of individual business areas, M&A, and the launching of new businesses.
The Crisis Management Subcommittee keeps the company prepared for any crisis.
Inheriting the function of the former Crisis Management Committee, the Crisis Management Subcommittee works to maintain the Konica Minolta Group's corporate value, carrying out its tasks in close partnership with the crisis management committees of Group companies engaged in global businesses. Moreover, in joint efforts with various Konica Minolta Holdings' committees that govern internal control systems, subcommittee members work to build a Group-wide governance system with the aim of enhancing Konica Minolta's corporate value.
The Crisis Management Subcommittee has classified crisis risks into 13 categories. Based on thorough analyses of various factors and details of those risks, the subcommittee has decided upon the measures to be taken in the following three phases: predictive/preventive measures during non-emergency, emergency, and post-emergency. The Subcommittee maintains close communications with all Group companies. By maintaining constant attention to the emergency networks shared by Konica Minolta Holdings and respective Group companies' crisis management committees, the subcommittee can obtain real-time information from all Group companies, not only in Japan, but all around the world.
We encourage Group companies to inform us of any sign of risk. Even if there is no sign of emergency, we regularly collect reports, which are summarized in our monthly reports for submission to top management.
Factors and Examples of Crisis Risks (excerpts)
| Factors | Examples | |
|---|---|---|
| 1 | Defective products, recalls, product liability lawsuits | Design errors (faulty products, health hazards), errors in manufacturing processes (faulty products, foreign substances contained in products) etc. |
| 2 | Defective services | Inappropriate explanations, discriminatory attitudes toward customers etc. |
| 3 | Personnel-related problems | Ambiguous performance evaluation standards, unfair transfer, human rights infringement such as employment discrimination and harassment, crimes/scandals involving employees etc. |
| 4 | Labor-related problems | Labor disputes, unfair labor practice, child labor, forced labor, occupational health hazards, employee death or suicide caused by overwork etc. |
| 5 | Corporate negligence | Pollution (soil, wastewater, odor), industrial accidents (health and safety hazards, accidents) etc. |
| 6 | Company's unethical conduct | Contacts with illegal groups, scandals, internal disputes, M&A etc. |
| 7 | Inappropriate decision-making on management and marketing | Risks involved in investments, loans, bonds and transactions; excessive competition etc. |
| 8 | Corporate crimes | Illegal acts (violation of Antimonopoly Act, Premiums and Representation Act, Subcontract Act, Tax and Commercial Laws etc.) |
| 9 | Intimidation and other crimes committed against the Company | Obstruction of business (inserting foreign substances in products etc.), robbery, subversive activities etc. |
| 10 | Economic and social disturbances | Oil crises, major power failure, sharp decline in stock prices etc. |
| 11 | International/political upheavals | War, coups, trade conflicts etc. |
| 12 | Disasters and epidemics | Earthquakes, storms and floods, fires, epidemics etc. |
| 13 | Rumors concerning management instability | Incorrect information by mass media, spreading rumors through various channels, including the Internet etc. |
Konica Minolta's Initiatives for Improving Disaster Preparedness
We are working to establish business continuity plans encompassing the entire supply chain
The Konica Minolta Group believes that one of the most important missions of a global enterprise is to continue its business—even in the event of disaster. As a global enterprise, we are fully aware of this mission, and constantly strive to improve our disaster preparedness. If we do suspend operations, we should resume them as soon as possible, since suspension of our business can affect our stakeholders worldwide. To minimize any such negative effect on our customers and other stakeholders, each Group company has begun reviewing and improving its business continuity plan. First, each Group company designates essential businesses that cannot be suspended, and identifies any production and supply bottlenecks that must be eliminated in order to ensure continual operation of these businesses. Next, they consider measures for protecting such essential businesses, together with alternative means. Through these approaches, with a global perspective, each Group company is striving to improve its business continuity plan so that it encompasses the supply chain.
We are vigilant about preparing for major earthquakes.
2007 group-wide emergency drill
Earthquake hazards comprise the greatest menace for any enterprise operating in Japan. The recent series of earthquakes, especially the 2007 Chuetsu Offshore Earthquake, revealed the risk that an entire industry can be paralyzed by damage to a single company. Many of our stakeholders in and outside Japan are concerned about the Group's preparedness for such risks.
At the Konica Minolta Group, we believe that improving our preparedness for major earthquakes will ultimately lead to our building a solid structure that is effective against other disasters as well. To ensure continual operation even in emergency, we are always working to improve our disaster preparedness. In this effort, we place particular priority on improving preparedness for potential earthquakes, most notably large earthquakes in the Tokai and Tonankai regions, along with the Tokyo metropolitan area. For instance, in 2007, we carried out a group-wide emergency drill in Japan simulating a situation where metropolitan Tokyo had been hit by an earthquake, and an emergency headquarters had to be set up in the Kansai region to take over the functions of our head office in Tokyo.
After the Great Hanshin-Awaji Earthquake (1995), regrettably, it took nearly a week to confirm the safety of all our employees living in the affected area. Based on this experience, we have developed an original safety confirmation system. Under the new system, employees living or working in an area hit by a large earthquake (seismic intensity 5 or above) are prepared to provide safety information to the host system via their PCs or mobile phones. We hold periodic drills so that employees can thoroughly learn the reporting procedures.
Action Manual in the Event of an Earthquake
All employees have been given an earthquake action manual.
To ensure that employees remain calm and take appropriate action in the event of a large earthquake, we provide each employee working in our Group companies in Japan with a handbook titled "Action Manual in the Event of an Earthquake."
Priority in the Event of Disaster
- Ensure safety of employees and their families.
- Minimize aftereffects.
- Maintain business operations or resume them as quickly as possible.
- Participate in local disaster reduction activities.
Top managers are also taking the lead in establishing business continuity plans that upgrade the Group's preparedness against new types of risk such as influenza and other pandemics, in order to ensure the responsible business operations of the Group.
