- Risk Management
CSR Activity Report (CSR Guideline Activity Reports)
Under normal conditions, assess and analyze risks, and strive to mitigate and prevent them from materializing; and in the event of a crisis that could have a significant impact on management activities, strive to prevent damage from increasing, by bringing the situation quickly under control and normalizing conditions with a prompt and appropriate response
Toray Group regularly identifies potential management risks affecting the Group’s management activities in order to mitigate risks and seeks to prevent a crisis. In addition, the Group strives to prevent damage from spreading and to promptly control and normalize the situation by ensuring quick and appropriate responses using the emergency quick response system it has established.
The risks affecting Toray Group are constantly changing, and the Group recognizes the critical importance of reinforcing its system for responding to risks that materialize suddenly due to changes in the surrounding environment and for responding promptly when crises do occur. To this end, Toray Industries, Inc. established a dedicated team within the Corporate Strategic Planning Division to communicate closely with the Board of Directors and top management and to pursue risk management as an integral part of management strategy. This team manages overall risk under normal conditions and ensures a quick response when crises do occur.
The general manager of the Corporate Strategic Planning Division regularly reports on the status of risk management to the Board of Directors and makes certain to inform the Board when a critical issue or emergency arises. In April 2021, a new department to deal with economic security risks was also established within the Corporate Strategic Planning Division. It is working to gather information both in and outside the Company and mitigate risks.
Structure of the Risk Management Committee
Chaired by the general manager of the Corporate Strategic Planning Division, the Risk Management Committee is tasked with reviewing, discussing and promoting shared awareness of risk management across the entire Toray Group. This committee primarily carries out priority risk mitigation activities as part of regular risk management. In addition, the Overseas Crisis Management Committee and local crisis management committees, which manage employees’ overseas travel under normal conditions and compile information on overseas risks, have also been made subordinate to the Risk Management Committee. The committee keeps the Board of Directors regularly informed about the contents of its discussions and reporting matters.
Strengthening the Emergency Quick Response System
Toray Group has established Risk Management Regulations, a set of clear fundamental principles that form the basis of a company-wide response in the event of a major crisis. The Group works to ensure the thorough implementation of these rules when required. Moreover, the Group reviews the rules as appropriate to prepare for new risks that emerge due to changes in the social environment. In order to ensure quick management decisions especially in the event of a crisis, Toray Group has clarified the reporting channel from a department where a crisis has occurred, covering group companies in and outside of Japan. The Group recognized that the rapid spread of COVID-19, which emerged at the end of 2019, posed a serious risk to the health and safety of employees and the Group’s business continuity. In accordance with its rapid response framework, the Group established a group-wide emergency headquarters on February 7, 2020, headed at the time by an executive vice president1.
The emergency headquarters has been creating and promoting measures to ensure the safety and health of employees and continued operations. This has been done in accordance with the pandemic measures and directives issued in countries where the Group operates.
- 1 The headquarters is headed by a Senior Vice President (Member of the Board) as of July 2022.
CSR Roadmap 2022 Targets
CSR Roadmap goals
- Strengthen corporate risk management throughout the Toray Group and mitigate risks
- Instill greater risk management among employees by rolling out risk management education throughout the Toray Group
Main Initiatives and Key Performance Indicators
⑴ Follow up on Toray’s priority risks
⑵ Conduct periodic risk management (priority risk mitigation activities through a three-year cycle) and routine risk management (observing trends in and outside Japan, and establish a group-wide system to respond to risks that may have a significant impact on management, as identified through research and analysis, as “specified risks”); and in the event of a group-wide crisis, respond appropriately in accordance with the Risk Management Regulations
⑶ Regarding major earthquakes in Japan, prepare and regularly review business continuity plans for key products, and conduct regular drills to establish a group-wide emergency response headquarters
⑷ Regarding information security risks, monitor and bolster the contents of communications and enhance education and training on the risk of cyberattacks and information leakage
In addition, starting in fiscal 2021, designate information security risks as part of the fifth three-year set of priority risks for Toray Group, and accelerate more comprehensive initiatives.
⑸ Provide risk management education
|Key Performance Indicator (KPI)||Target||Fiscal 2021 Result|
|Fiscal 2020||Fiscal 2021||Fiscal 2022|
- Reporting scope : Toray Group
Looking to the Future
CSR Roadmap 2022 goals are: (1) strengthening corporate risk management throughout Toray Group and mitigating risks; and (2) instilling greater risk management awareness among employees. To achieve these goals, the Group will periodically and routinely identify latent risks in management activities, prevent and mitigate risks, and prevent crises from ever occurring.
The fifth three-year set of priority risks to be addressed over the three years from fiscal 2021 to 2023 are information security, global CSR procurement, and business continuity risks from water hazards. Initiatives to mitigate these risks are being promoted across the Group.
As part of this effort, Toray has completed confirmation of the current situation and established mitigation measures for business continuity risks from water hazards. Accordingly, these priority risk activities have been completed in fiscal 2021.
Although priority risk activities are to be conducted over a period of three years, the plan is to review these activities with the aim of engaging in risk management to achieve management goals. Specifically, in order to set priority risks for achieving the next Medium-term Management Program (fiscal 2023 to 2025), the current fifth three-year set of priority risks will be ended one year ahead of schedule, in fiscal 2022 instead of 2023. The plan is to carry out the sixth three-year set of priority risks from fiscal 2023 to 2025, to coincide with the next Medium-term Management Program period.
Fiscal 2021 CSR Activity Report
Click below on activity reports for fiscal 2021