Risk Management

The Yamaha Group is engaged in efforts to develop and improve its risk management promotion structure and systems in order to boost risk response capabilities and to achieve healthy and transparent management. The Group implements risk management promotion based on the following policies.

  1. We shall establish organizations and frameworks for risk management and work to enhance responsiveness to risk in order to maximize corporate value.
  2. In risk management activities under normal circumstances, we shall identify, evaluate, and mitigate risks and conduct awareness-raising activities such as education and training to instill a greater awareness of and foster a greater sensitivity toward risks.
  3. We shall prioritize people’s safety when risks manifest themselves as crises and coordinate with local communities to ensure sincere, appropriate, and speedy responses to minimize adverse impacts. In addition, we shall strive to ensure the stable supply of products and services, continue business to the greatest extent possible, and contribute to the sustainable development of society.
  4. After addressing risks, we shall analyze the reasons they occurred and how they were addressed in order to ensure they do not occur again.

Under the supervision of the Board of Directors, Yamaha Corporation has established the Risk Management Committee as an advisory body to the president and representative executive officer. The committee discusses risk management-related matters from a Companywide perspective and reports the results of these discussions to the president and representative executive officer. In addition, the Working Group for BCP and Disaster Prevention Management, Working Group for Financial Management, Working Group for Compliance, Working Group for Export Control, and Working Group for Information Security have been established under the Risk Management Committee. These working groups set activity policies and monitor activities related to important Companywide themes. The effectiveness and promotion status of risk management frameworks are verified and monitored via reports from executive officers to the Board of Directors.

Risk Management System

[ picture ] Risk Management System
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The Risk Management Committee categorizes the various risks identified in relation to the Yamaha Group’s business into four categories: operating environment risks, business strategy risks, business activity-related process risks, and management foundation-related process risks. The materiality of risks is assessed based on the projected scale of damages and frequency of materialization. In addition, the level of control is evaluated for each risk category, material risks requiring priority response are identified, and the divisions responsible for managing these risks are designated in order to promote risk mitigation activities and thereby improve overall risk control levels. The table below provides additional information on risk categories.

[ picture ] Risk Classification (Major and middle classification)
[ picture ] (Business strategy risk) Fundamental risk, Control level as of 2020/3

Climate Change Countermeasures

In June 2019, the Yamaha Group declared its endorsement of the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and commenced initiatives for analyzing the impact of climate change on its finances and disclosing related information. For information regarding disclosure based on the recommendations of the TCFD, please refer to the following link.

Business Continuity Management

In preparation for large-scale natural disasters, fires, infectious disease pandemics, and other emergency situations, the Yamaha Group has formulated business continuity plans (BCPs) and implements other business continuity management efforts. The Working Group for BCP and Disaster Prevention Management, which is chaired by a managing executive officer and positioned under the Risk Management Committee chaired by the president and representative executive officer, has been established as an organization for formulating business continuity policies for responding to natural disasters and other emergency situations. In addition, Group policies and rules for responding to natural disasters and other emergency situations have been developed. In the event of an emergency, an emergency response headquarters will be set up to examine potential measures for ensuring Groupwide business continuity.
In addition, the Group BCP Standards establish basic policies, duties, and rules to minimize the effect on business when a risk event occurs, such as a natural disaster, through the rapid implementation of appropriate countermeasures.

Major Initiatives
  Initiatives in fiscal 2020
Basic policies and rules Reviewed and implemented partial revisions to the Group BCP Standards and Group BCP Guidelines
BCP formulation and training
  1. Implemented improvements to the procedures for enacting swift business continuity measures in times of emergency in the emergency response headquarters that are responsible for Groupwide emergency response measures
  2. Conducted Regional Disaster Management Headquarters and Earthquake Initial Response Training (“blind scenario” training), which puts participants in a situation in which operations are stopped immediately after a disaster occurs, since 2016 to improve the initial response capabilities of business sites; made improvements to the BCP initial response procedures manual based on training results
  3. Revised, evaluated, and improved the risk-specific BCPs established for all global Group companies with a focus on initial response measures
Infrastructure development
  1. Established facility-specific security standards and commenced measures for reinforcing security provisions
  2. Formulated Yamaha Equipment Earthquake Resistance Standards and applied standards to new equipment at the time of introduction
  3. Introduced an employee safety check system and performed regular drills to ensure effectiveness in times of emergency
Other concrete initiatives
  1. Set up the emergency response headquarters to address the COVID-19 pandemic, which collected information from Group companies and regions around the world to be shared within the Group
  2. Sent relief items to local Chinese subsidiaries
  3. Revised risk provisions of BCPs of Group companies, which had previously primarily focused on earthquakes, storms, floods, and other natural disasters, to account for pandemics; future revisions to be made to provisions pertaining to stockpiles and other matters
[ photo ] Emergency response headquarters BCP training
Emergency response headquarters BCP training
[ photo ] Regional Disaster Management Headquarters and Earthquake Initial Response Training
Regional Disaster Management Headquarters and Earthquake Initial Response Training

Financial Management

The Yamaha Group is globally promoting internal control activities centered around financial management, such as the Groupwide standardization of operational processes. The Working Group for Financial Management is responsible for confirming that operations across the entire Group follow the Group Management Charter and various regulations.

Compliance

The Yamaha Group established the Working Group for Compliance to play a central role in policy-making and deliberations related to compliance matters. This working group both promotes compliance in the Group and monitors the business execution of divisions and Group companies to ensure legal compliance and ethical operations. It also executes measures to maintain healthy business activities through employee education, awareness-raising, questionnaires, and the establishment of whistleblowing and consultation helplines.

Export Control

The Yamaha Group has established provisions for trade security control in its Compliance Code of Conduct as compliance measures pertaining to international trading.

The Working Group for Export Control has been established and export control regulations and import and export procedure regulations have been formulated as part of efforts to develop a process for managing exports.

Information Security

The leakage of personal information and other important information held by a company has the potential to not only damage third parties but also become a case of gross negligence that can harm the company’s reputation.
The Yamaha Group perceives information security as a critical aspect of risk management. The Information Security Working Group has put together a policy on information management and is working to enhance the quality of this management by keeping track of the current management system while identifying vulnerabilities and guiding efforts to address them. In addition to having established rules for the usage and management of information systems as part of the Compliance Code of Conduct, we are working hard to ensure employees understand the importance of preventing inadvertent data leaks while taking precautions to protect against hacking by third parties.

Occupational Health and Safety and Environmental Risk Management

In order to prevent occupational accidents and environmental pollution, the Yamaha Group performs risk assessments at factories and other business sites. In addition, regular monitoring, audits, emergency response training, and other activities are carried out under the guidance of dedicated occupational health and safety and environmental preservation staff members.