Risk Management

Basic Policy for Risk Management

  Yamaha has chosen “CREATING ‘KANDO’ TOGETHER” as its corporate objective that commands the highest position in the hierarchy of our corporate philosophy. The Yamaha Group perceives events that impede the attainment of the corporate objective as risks and implements risk management based on the following policy.

  1. We shall establish a structure and framework for risk management and work to enhance responsiveness to risk and maximize corporate value.
  2. We shall identify, evaluate and reduce risk through risk management activities during ordinary times, conduct awareness-raising activities such as education and training, and share information on risks in order to permeate risk awareness and foster risk sensitivity.
  3. We shall prioritize people's safety when risk occurs, and coordinate with the local community to ensure sincere, appropriate and speedy response as a means to minimize the impact of risk. In addition, we shall strive to ensure the stable supply of products and services, continue business to the extent possible and contribute to the sustainable development of society.
  4. We shall work to prevent reoccurrence of risk that we have resolved.

Classification of Risk and Definition of Risk Management

  The Yamaha Group classifies the various types of risks related to its business in the following manner and is working on measures to counter each type.

[External Management Environment Risk]:External risk that is difficult for a company to predict
[Business Process Risk]:Risk in which the impact can be reduced through internal control and factor analysis, etc.
[Business Strategy Risk]:Risk associated with business strategy and management judgment

  The Yamaha Group broadly defines “risk management” as general activities implemented to properly control the various types of risk that occur in conducting business. In addition, risk management is divided into measures and response at ordinary times and during an emergency in the following manner.

[At ordinary times]: Risk management (Narrow definition)
Yamaha implements measures to prevent the incidence of risk at ordinary times based on a narrow definition of risk in which risk can potentially manifest in any situation.

[During an emergency]: Crisis response
In case a crisis occurs, Yamaha will react quickly and accurately to minimize the impact and ensure immediate recovery based on a definition of crisis as an emergency situation in which risk has already manifested.

  • * Although all risk may be subject to crisis response, this type of response is reserved for the types of risk that may cause a significant impact on management.

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Risk Management Promotion System

  Yamaha Corporation has established a Risk Management Committee as an advisory body to the President pursuant to the basic policy for risk management. This Committee deliberates on matters related to risk management from a Company-wide standpoint and reports its findings to the President and Representative Director. Working groups for BCP and disaster countermeasures, internal control, compliance and export screening have been established under the Risk Management Committee to deal with important matters that are difficult for individual business divisions and administrative divisions to cover during the execution of their basic day-to-day duties, and implement risk management activities.

Introduction to Concrete Initiatives

■Business Continuity Plan (BCP)

  In fiscal 2009, Yamaha formulated the BCP Guidelines, its basic Companywide policy for its business continuity plan, which is designed to enable the immediate resumption of operations in the event of an earthquake in Japan's Tokai region where Yamaha headquarters are located or other major natural disaster that could cause damage to its buildings or facilities. In January 2012, Yamaha established various guidelines including the BCP/Disaster Basic Countermeasures, Earthquake Countermeasures, and Fire Countermeasures, which update and supersede the BCP Guidelines.

  Yamaha has been conducting BCP training assuming an emergency situation since fiscal 2010. In fiscal 2012, Yamaha conducted a 90-minute simulation whereby participants had to practice dealing with the period from 72 to 120 hours following a large earthquake based on a steps to restore business infrastructure after a disaster. The training applied a “blind scenario method” in which participants did not know beforehand which scenario they would tackle. Yamaha departments and a “dummy organization” playing the role of a partner company inquire about conditions to different specialized groups in charge of information systems, logistics and other areas, and examine countermeasures for each specialized group under fast-changing circumstances.

  In February 2013, Yamaha held a briefing on the Group-wide policy for BCP and initiatives for 74 partner companies that cooperate with manual regarding procurement of materials and components. The briefing included a basic lecture by a learned individual and a report on the results of a survey concerning BCP initiatives conducted in advance at partner companies. This served to deepen understanding of the importance of formulating a BCP as well as Yamaha's policy and initiatives.

■Safety Abroad

  Yamaha is taking steps to ensure the safety of employees that are stationed overseas and that go overseas on business trips from the perspective of prevention and response in the event of an accident. Information concerning danger in each country and region is gathered from such sources as governmental agencies, private security companies, employees stationed at overseas Group companies and those that have returned from abroad. The information is then distributed internally in the form of reminders and business trip regulations. Safety-related education is also provided to employees that have been dispatched overseas and those taking business trips. In addition, Yamaha is developing a contact system for times of emergency and an emergency response manual as countermeasures for when risk arises.

  Yamaha Corporation's health and safety managers conduct audits and provide guidance as safety measures for overseas Group companies, while facility control managers conduct audits and provide guidance on facilities such as production equipment. In fiscal 2012, health and safety audits were performed at six locations in China, Indonesia and Malaysia and facility safety audits were performed at three locations in China and Indonesia.

Health and safety audit in Indonesia (industrial doctor giving advice on protective equipment)
Health and safety audit in Indonesia (industrial doctor giving advice on protective equipment)

Auditing a facility at P.T. Yamaha Indonesia

Auditing a facility at P.T. Yamaha Indonesia

Auditing a facility at P.T. Yamaha Indonesia

Auditing a facility at P.T. Yamaha Indonesia

Auditing a facility at P.T. Yamaha Indonesia

■Export Control

  A Working Group for Export Screening has been established under the Risk Management Committee at Yamaha Corporation, formulating export control regulations and regulations for import and export procedures among others, and establishing a work process related to export control. In fiscal 2012, Masataka Morimoto, a senior staff member at the Center for Information on Security Trade Control at Keio University, was invited to conduct a seminar on the importance of export control in a company with the aim of sharing basic knowledge internally.

■Environmental Risk Management

  As a part of its CSR activities, the Yamaha Group actively works to promote the regional environment by reducing the environmental burden of its business activities, products and services, and effectively using energy and natural resources under the Yamaha Group Environmental Policy. Key initiatives for environmental risk management include regular monitoring, environmental audits and emergency response training.

→ Click here for details of environmental risk management

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