In order to sustainably increase corporate value over the long term while working to realize a Kirei World in which all life lives in harmony, which is our purpose, timely and appropriate responses to increasingly diverse and complex risks are needed.
We regard potential negative impacts on the achievement of the management targets and business activities as a "risk," and the manifestation of such risk as a "crisis." We appropriately manage the various risks and crises that could occur across our business in accordance with the response priorities detailed in the Kao Risk and Crisis Management Policy (1. Protection of human lives, 2. Environmental conservation, 3. Continuation of operations, 4. Protection of assets).
The Risk and Crisis Management Committee establishes the management system and activity guideline for risk and crisis management. Divisions and affiliates conduct risk management by identifying and assessing risks and formulating and implementing appropriate countermeasures based on this activity guideline. Affiliated companies outside Japan are managed through business divisions. In addition, when a crisis arises an Emergency Response Team is launched corresponding to the severity of the emergency to promptly and appropriately address the crisis in order to minimize physical damages and financial losses. The Management Board reviews these efforts at regular intervals and other times as needed, and the Board of Directors approves them.
The Risk and Crisis Management Committee and the Management Board have defined 14 main risks of special importance as risks that could negatively impact our sustainable and profitable development, and the contributions we make to the sustainability of society through our business activities. The managing divisions have established response policies for these risks and are managing their progress. Among the main risks, we designate those that would have a particularly large impact on our management and for which we need to strengthen our responses as "corporate risks." Once a year, the Management Board selects risk themes and risk owners (Executive Officers) based on internal risk survey analysis, analysis of the external environment, and informational interviews with management. The risk owners establish response teams to continue examining the risks, and the Risk and Crisis Management Committee meets four times a year to manage their progress.
Risk including damage to employee health and temporary business suspensions occurring due to the long-term effects and infectious mutant variants of the global COVID-19 pandemic
Risks that cause value and social trust in our brand to decline due to the spread of critical reviews and misinformation about Kao on social media
Risk of leaks of personal information from intentional acts including cyberattacks or negligence
Risk of harm to employees and assets including facilities and difficulties in supplying products as a result of large-scale earthquakes and other natural disasters such as large typhoons and floods associated with climate change
Risks of serious quality issues arising that would cause the loss of social trust