Risk Management

Group-Wide Risk Management Efforts

At SII, the CSR Committee with the President serving as the chairman plays a central role in promoting across-the-board risk management. The committee aggregates information on various types of risks including potential ones in advance and identifies risks to be controlled every fiscal year. The identified risks are evaluated and sorted on a risk map according to qualitative and quantitative impact and frequency of occurrence, and the progress of relevant countermeasures is checked every quarter. Critical risks of the fiscal year are reported to the Board of Directors. The CSR Committee met six times in FY 2020.

Also, the status that could be business risks is managed using KPI, Key Performance Indicator, and monitored at the management meetings on a regular basis.

In preparation for large scale disasters, which represent one of the risks, we have provided each employee with a helmet. After a disaster strikes, in anticipation that it may be temporarily difficult for employees to return home due to traffic restrictions and road disruptions, etc., we have systematically prepared water, food, emergency blankets, and other emergency supplies. In addition, we have equipped the head office and each unit with emergency radios so that we can communicate with each other even in the event of a failure of the public communication network.

Risk Management in Continuing Business

SII manufacturing sites conduct risk management to prevent production interruption, aiming to continually provide products even when a risk arises.
The examples of our wide-ranging risk management are operational improvements at the local-working level and radical improvement which requires equipment investment.

10-Minute Rule and 2-Hour Rule

SII launched the reporting rule in the event of crisis called 10-Minute Rule and 2-Hour Rule in 2003, describing that the SII Group employees must inform the president promptly once they find any events that may be associated with actual potential risks.
This rule requires that any event with potential corporate risk must be informed to the President of SII within ten minutes if it occurs in Japan, or within two hours if it occurs outside Japan. Since speedy reporting is given the first priority, we welcome all reports even though the initial content is not sufficient.

Preparation of comprehensive risk management manuals for sites outside Japan

In 2016, SII sites outside Japan completed the preparation of crisis management manuals for each hazard, such as fire, typhoon, earthquake, and highly virulent infectious diseases, and from 2017, we have been working on the preparation of a comprehensive crisis management manual that incorporates multiple hazards specific to the sites. For example, at manufacturing companies, there is the risk of environmental pollution caused by chemical substances in factories, and at sales companies, there is the risk of theft or loss of life due to intrusion by suspicious persons. We aim to ensure the safety of our employees and the company’s assets by sharing with our employees preventive measures, risk minimization measures, and standards of conduct for possible hazards.

The COVID-19 pandemic has spread all over the world and shows no sign of ending yet. At our sites outside Japan we had established a crisis management system for highly virulent infectious diseases five years ago. We have prepared countermeasures such as manuals with codes of conduct for employees and stockpiles of emergency supplies, and have repeatedly conducted peer assessments and self-inspections of the crisis management system, as well as dissemination of the codes of conduct and drills. As a result, we were able to mitigate the risk to the company and employees when the COVID-19 infection spread.

Since the COVID-19 pandemic has not ended and there is a possibility of new outbreaks, in FY 2021 we plan to review the current crisis management manual through self-inspections and on-the-job training to improve it by including more practical codes of conduct. In addition, we plan to conduct an audit of the head office in or after FY 2022.