Governance
Risk Management

Basic Approach to Risk Management

The Yokowo Group is committed to fulfilling its corporate social responsibility and ensuring organizational stability by responding appropriately and promptly to risks. We ensure compliance with relevant laws and regulations and continuously improve our risk management systems and performance through proactive initiatives.

Risk Management Framework

Under the Sustainability Committee structure, the SCI Division and the Business Risk Management Committee are responsible for promoting risk management. We conduct regular risk assessments and continuously monitor risks. Progress on risk-related initiatives and KPI targets is reviewed by the Sustainability Committee and the Business Risk Management Committee and reported to the Board of Directors.

Major Initiatives

The Yokowo Group’s business environment is influenced by a range of external factors, including geopolitical risks, natural disasters, climate change, human rights issues, cyberattacks, and supply chain disruptions.

To maintain stable and sustainable business operations, the Group identifies risks with a significant potential impact, prioritizes them, and implements appropriate countermeasures. The Group has established a “Risk Management Policy” and “Risk Management Guidelines” under its Risk Management Regulations.

Risk assessments are conducted annually, and for risks identified as high priority, mitigation plans are developed and implemented to ensure effective risk control.

Risk Control

In addition to annual ISO-based internal audits, we regularly conduct risk assessments to identify potential risks. The Business Risk Management Committee focuses on risks directly related to each business unit, ensuring early detection, sharing, analysis, and the formulation and execution of countermeasures. The committee also reports to and exchanges information with independent outside directors to enhance the effectiveness of management oversight.

Performance

We conduct risk assessments annually, evaluating identified risks based on “frequency of occurrence” and “impact on management,” each on a five-point scale. For risks with high scores, we develop and implement improvement measures within annual plans to reduce risk levels compared to previous years.

For KPIs related to Risk-Management, please refer to Sustainability Management.