Risk Management

Basic Approach

The DNP Group strives to create new value that enhances the sustainability of the global environment and realizes a healthy society and economy, and comfortable and fulfilling lives for people, thereby achieving sustainable growth for DNP itself. As the factors that affect management, such as sudden changes in the social environment, become increasingly diverse and widespread, we believe that appropriately assessing and analyzing risks across the company, reflecting them in our medium- to long-term management strategies, and strengthening the process of converting them into business opportunities will help build a more sustainable society and lead to the future standards that we advocate.

Sustainability Management

Materialities

Promotion Structure

Based on our fundamental approach, the Sustainability Committee—chaired by the Representative Director and President—oversees the management of medium‑ to long‑term risks, the identification of business opportunities, and the incorporation of these insights into management strategies. In addition, the BCM Promotion Committee ensures employee safety and maintains production activities in the event of natural disasters or other emergencies, thereby supporting business continuity. The Corporate Ethics Committee works to enhance employee compliance awareness, which is essential to corporate continuity, and to reduce risks. Working in close collaboration, these three committees have established a system that comprehensively addresses company‑wide risks and promotes integrated risk management.

The Board of Directors receives reports and recommendations on matters deliberated and resolved by each committee, and deliberates on and supervises the DNP Group’s risk management policies and action plans.

Sustainability Committee

The Sustainability Committee convenes in principle four times per year, and additionally as necessary, to appropriately reflect the DNP Group’s approach to sustainability in its management strategies. The Committee deliberates on the following matters and submits reports and recommendations to the Board of Directors.

Managing medium‑ to long‑term sustainability‑related risks, identifying business opportunities, and reflecting these in management strategies
Formulating sustainability‑related policies and overseeing the execution of initiatives by each division
Identifying sustainability issues, setting goals and plans, evaluating progress and implementation status, and carrying out corrective and improvement measures

Corporate Ethics Committee

The Corporate Ethics Committee oversees internal controls as an organization responsible for enhancing employee compliance awareness—an essential foundation of business continuity—and for reducing risks. The Committee meets at least once a month to deliberate on the following matters and submits reports and recommendations to the Board of Directors.

Formulating and approving policies related to the Group-wide compliance framework, as well as implementation plans for related activities
Conducting comprehensive inspections, guidance, and reviews of the development and operation of compliance systems in accordance with implementation plans

Ensuring Thorough Compliance

BCM Promotion Committee

The BCM Promotion Committee addresses business continuity risks as an organization responsible for ensuring corporate continuity by securing employee safety and maintaining production activities even in the event of natural disasters or other emergencies. The Committee convenes in principle four times per year, and additionally as necessary, to deliberate on the following matters and to submit reports and recommendations to the Board of Directors.

Establishing and enhancing the business continuity management (BCM) framework
Promoting disaster prevention and preparedness activities

Business Continuity Planning (BCP/BCM)

Risk Management

DNP promotes integrated risk management to minimize the negative impact of management variables while expanding business opportunities. For risks deemed particularly significant or high in priority, a responsible risk management division is designated, and—following discussions by the Management Committee—these risks are reflected in business strategies and plans. With respect to opportunities, the DNP Group identifies priority business domains and advances strategic business development across the organization.

Business Risks

We work to reduce risks by properly assessing and analyzing them and reflecting the results in our medium‑ to long‑term management strategies, while also promoting initiatives to convert risks into business opportunities. Among these, we recognize “information and cybersecurity threats and tighter regulations” and “DX promotion and increasing use of AI” as emerging risks and are reinforcing our responses to them.

また、DNPが事業活動を継続していくためには、法令を遵守することはもとより、全社員が社会倫理に基づいた誠実な行動をとることが重要であると考えています。これらの社員の行動のあり方を定めた「DNPグループ行動規範」を基本とする当社の視点と、国際規範をはじめとする社会全体の視点の両面から重要性を分析し、「公正な事業慣行」「人権・労働」「環境」「責任ある調達」「製品・サービスの安全性と品質」「情報セキュリティ」「企業市民」を重点テーマとし、サプライチェーン全体を通じたリスクマネジメントの徹底を図っています。

Major Risks

Risks	Initiatives to Reduce Adverse Impact and Transform Risks into Opportunities
Human rights risks	Initiatives based on the DNP Group Human Rights Policy Implementation of human rights due diligence Strengthening the effectiveness of reporting channels accessible to all stakeholders Conducting dialogue with stakeholders, etc. 人権の取り組み
Occupational safety risks	Initiatives based on the DNP Group Health and Safety Charter and the DNP Group Declaration on Health Reviewing the basic plan every three years and strengthening specific initiatives to prevent occupational accidents Continuing the “Tsuki-ichi Kyoiku Activity” (an activity to set aside one hour each month for Taiwa and education) at all manufacturing sites Identifying and visualizing risk areas in all equipment, and implementing safety measures across all workplaces in accordance with DNP’s proprietary safety standards 労働安全の取り組み
Risks related to the safety and quality of products and services	Initiatives based on the DNP Group Quality and Product Safety Policy Identifying and evaluating risks at the design stage for all products and services, and reducing the negative impact of risks detected Conducting annual quality system inspections by the Head Office Quality Assurance Supervisory Division; reporting results to the DNP Group Quality Assurance and Product Safety Committee and the Corporate Ethics Committee, followed by improvements based on their instructions 製品・サービスの安全性と品質の取り組み
Information security risks	Initiatives based on the DNP Group Information Security Policy Establishing the Information Security Committee and the Information Security Headquarters at the Head Office as company‑wide umbrella organizations, and conducting inspections and providing guidance for business divisions and group companies Establishing the DNP CSIRT (Computer Security Incident Response Team) at the head office as an organizational function for cybersecurity incident response, to maintain and strengthen business continuity in the event of unforeseen incidents Promoting information security measures based on the pillars of “organizational measures,” “personnel measures,” and “physical and technical measures” 情報セキュリティの取り組み
Risks related to compliance with laws, regulations, and internal rules	Establishing and periodically reviewing the DNP Group Code of Conduct Providing education and awareness promotion through level-specific training and Autonomous Corporate Ethics Training for all Group employees in Japan and overseas Operating the Open Door Room and the global internal whistle-blowing channel to support consultations and reporting コンプライアンスの徹底の取り組み
Supply chain risks	Initiatives based on the DNP Group Sustainable Procurement Guidelines, etc. Concluding basic business contract with business partners that include clauses requiring adherence to DNP’s guidelines Conducting regular assessments of suppliers’ compliance with DNP guidelines, providing feedback on results, and holding explanatory briefings Conducting annual compliance and risk assessments for critical suppliers*, requesting improvement plans where risks are identified, and providing document‑based guidance and individual interviews Suppliers accounting for approximately 90% of annual purchase value and suppliers critical to business continuity. Supply Chain Management
Risks related to natural disasters, etc. (Water risks due to climate change, large-scale earthquakes, new infectious diseases, etc.)	Establishing the BCM Promotion Committee at the Head Office and Division/Group BCM Promotion Committees in each business division and Group company to advance appropriate preventive measures Formulating business continuity plans (BCP) to minimize production stoppages and disruptions in product supply, and promoting appropriate business continuity management (BCM) Implementing fire prevention, earthquake‑resistance, and flood‑prevention measures; diversifying production bases and raw material suppliers; and transferring risk through various insurance programs Establishing the Central Disaster Prevention Committee at the Head Office, Disaster Prevention Committee at each business division and Group company, and District Disaster Prevention Committee in each region Implementing thorough disaster‑prevention measures based on the DNP Group Basic Disaster Regulations, preparing for unforeseen events such as natural disasters 事業継続計画（BCP/BCM）

Risks that require particular response in the medium to long term

Variable Factors	Initiatives to Reduce Adverse Impact and Transform Risks into Opportunities
Environmental Risk and Opportunity Factors More frequent and severe natural disasters due to climate change; increasing water risks Accelerating plastic pollution and biodiversity loss Accelerating transition toward a nature‑positive, carbon‑neutral, and circular economy; strengthened regulations Expansion of environmentally positive markets and acceleration of technological innovation etc.	Advancing initiatives to achieve the DNP Group Environmental Vision 2050 Setting medium‑term targets for 2030 and reducing environmental impact Promoting initiatives to address environmental issues through both value creation and strengthening of the business foundation 環境関連の取り組み
Social Risk and Opportunity Factors Human Capital–Related Variables Expansion of global business and global population growth Declining domestic working‑age population, low birthrate and aging population, and labor shortages Changes in awareness regarding human dignity (human rights and working conditions) Increasing economic disparities Supply Chain–Related Variables Growing geopolitical and country risks Risks arising from differences in culture, systems, and rules Increasing importance of corporate social responsibility and ethical behavior etc.	Accelerating the strengthening and maximization of human capital based on the Human Capital Policy Recruitment, personnel placement, and reskilling to build a resilient business portfolio, together with diversity and inclusion initiatives that leverage diverse strengths Activities based on the DNP Group Sustainable Procurement Guidelines (compliance surveys, briefings, etc.) Employee education including support for procurement staff to obtain professional certifications 社会関連の取り組み
Economic Risk and Opportunity Factors Economic Activity–Related Variables Globalization of markets and supply chains Geopolitical disruptions and fragmentation of supply chains Sudden fluctuations in economic indicators Strengthened regulations Technological Trend–Related Variables Promotion of DX and expanded use of AI Changes in lifestyles and work styles driven by technological innovation and accelerated global connectivity Information and cybersecurity threats; stronger associated regulations Widening digital divide and increasing privacy concerns etc.	Building a strong and stable business foundation through diverse business activities with tens of thousands of companies across various industries Building a robust business portfolio resilient to changes in the business environment Promoting appropriate and effective use of AI based on the DNP Group AI Ethics Policy Strengthening information security systems, employee training, and recruitment of security personnel Ensuring appropriate protection of intellectual property and know‑how through information security initiatives Securing stable procurement volume and maintaining optimal procurement pricing through multi‑sourcing from domestic and international suppliers 情報セキュリティサプライチェーンマネジメント

Variable Factors

Initiatives to Reduce Adverse Impact and Transform Risks into Opportunities

Environmental Risk and Opportunity Factors

More frequent and severe natural disasters due to climate change; increasing water risks
Accelerating plastic pollution and biodiversity loss
Accelerating transition toward a nature‑positive, carbon‑neutral, and circular economy; strengthened regulations
Expansion of environmentally positive markets and acceleration of technological innovation

etc.

Advancing initiatives to achieve the DNP Group Environmental Vision 2050
Setting medium‑term targets for 2030 and reducing environmental impact
Promoting initiatives to address environmental issues through both value creation and strengthening of the business foundation

環境関連の取り組み

Social Risk and Opportunity Factors

Human Capital–Related Variables
- Expansion of global business and global population growth
- Declining domestic working‑age population, low birthrate and aging population, and labor shortages
- Changes in awareness regarding human dignity (human rights and working conditions)
- Increasing economic disparities
Supply Chain–Related Variables
- Growing geopolitical and country risks
- Risks arising from differences in culture, systems, and rules
- Increasing importance of corporate social responsibility and ethical behavior

etc.

Accelerating the strengthening and maximization of human capital based on the Human Capital Policy
Recruitment, personnel placement, and reskilling to build a resilient business portfolio, together with diversity and inclusion initiatives that leverage diverse strengths
Activities based on the DNP Group Sustainable Procurement Guidelines (compliance surveys, briefings, etc.)
Employee education including support for procurement staff to obtain professional certifications

社会関連の取り組み

Economic Risk and Opportunity Factors

Economic Activity–Related Variables
- Globalization of markets and supply chains
- Geopolitical disruptions and fragmentation of supply chains
- Sudden fluctuations in economic indicators
- Strengthened regulations
Technological Trend–Related Variables
- Promotion of DX and expanded use of AI
- Changes in lifestyles and work styles driven by technological innovation and accelerated global connectivity
- Information and cybersecurity threats; stronger associated regulations
- Widening digital divide and increasing privacy concerns

etc.

Building a strong and stable business foundation through diverse business activities with tens of thousands of companies across various industries
Building a robust business portfolio resilient to changes in the business environment
Promoting appropriate and effective use of AI based on the DNP Group AI Ethics Policy
Strengthening information security systems, employee training, and recruitment of security personnel
Ensuring appropriate protection of intellectual property and know‑how through information security initiatives
Securing stable procurement volume and maintaining optimal procurement pricing through multi‑sourcing from domestic and international suppliers

情報セキュリティ
 サプライチェーンマネジメント

事業等のリスク（有価証券報告書）

Business Continuity Plan (BCP/BCM)

If an emergency occurs that threatens the continuation of a business and business activities are interrupted, it will have an impact not only on the company itself, but also on various stakeholders, including customers, business partners, and the people working there. In preparation for such situations, DNP has established the BCM Promotion Committee at its headquarters to promote countermeasures, and has also established the Business Unit and Group Company BCM Promotion Committee in each business unit. Utilizing this structure, we are constantly aware of disaster risks and are promoting appropriate preventive measures, based on the principles of "giving top priority to human safety measures in the event of a disaster" and "enhancing the company's disaster response and recovery capabilities."

Specifically, we are working to build a strong corporate structure that can quickly restore business activities even in emergencies by implementing fire, earthquake, and flood prevention measures for manufacturing equipment and other major facilities, diversifying manufacturing bases and raw material suppliers, formulating a business continuity plan (BCP) to minimize production stoppages and disruptions to product supply, and promoting appropriate management of that plan (BCM).

Disaster prevention system in preparation for unforeseen circumstances

DNP has established the Central Disaster Prevention Council to develop and promote basic disaster prevention measures for the entire group, the Business Unit and Group Company Disaster Prevention Council to promote specific disaster prevention measures suited to the characteristics of each business, and the Regional Disaster Prevention Council to promote disaster prevention measures by deepening cooperation between regions and areas, and is formulating disaster prevention plans and promoting preventive measures. For unforeseen circumstances such as disasters, we have established basic policies and promotion systems as the DNP Group Basic Disaster management Regulations, and are promoting a wide range of disaster prevention measures to ensure the safety of employees, their families, and related parties, and to reassure various stakeholders.

	Head Office	Each Business Unit / Group Company
Permanent Disaster Prevention Organization	DNP Group Central Disaster Prevention Council Chairperson Deputy chairperson Secretariat Subcommittee · Human resources subcommittee · Facilities subcommittee · Asset preservation subcommittee · Business activities subcommittee · Public relations subcommittee · Community subcommittee	Business Unit and Group Company Disaster Prevention Council Chairperson Deputy chairperson Secretariat Coordinator · Human resources coordinator · Facilities coordinator · Asset preservation coordinator · Business activities coordinator · Public relations coordinator · Community coordinator Fire protection and disaster prevention manager (DNP's own firefighting organization) *Individually established for each business unit / group company In areas composed of multiple organizations, regional disaster prevention councils are also set up to promote disaster prevention measures across the organization.
Functions and roles	Development and promotion of comprehensive and systematic disaster preparedness measures throughout the DNP Group	Promotion of practical disaster preparedness measures considering business content and regional characteristics
Maintenance of regulations, plans, etc.	DNP Group basic disaster management regulations · DNP Group basic disaster prevention plan · DNP Group large-scale earthquake response guidelines DNP Group fire and disaster prevention management regulations	· Disaster response work plan · Business Continuity Plan (BCP) · Fire management plan
Countermeasures organization in times of disaster	DNP Group Central Disaster Response Headquarters *The DNP Group’s Central Disaster Prevention council will be transferred as is, to promote and otherwise take overall control of company-wide disaster emergency measures, disaster recovery / reconstruction and other necessary measures in the time of a disaster.	Business Unit and Group Company Disaster Response Headquarters *The disaster council in each business unit / group company will be transferred as is, to promote and coordinate disaster emergency measures, disaster restoration / reconstruction and other necessary measures at a specific disaster site.

Related Measures

Employee Training

DNP has established the DNP Group Code of Conduct, which defines the behavior expected of all employees in conducting corporate activities, and works to ensure its thorough understanding through hierarchical training programs and Autonomous Corporate Ethics Training provided to all Group employees in Japan and overseas. Furthermore, recognizing the importance of addressing risks across the entire supply chain, we encourage both employees and business partners to understand and support the DNP Group’s Human Rights Policy, Environmental Policy, Sustainable Procurement Guidelines, and other related policies, and to put them into practice.

The term “all employees” refers to Directors, Audit & Supervisory Board Members, Corporate Officers, and Advisers of DNP Group companies, as well as individuals employed by each company and dispatched employees engaged under labor dispatch contracts.

Ensuring Thorough Compliance

Supply Chain Management

コーポレート・ガバナンス報告書 (226 KB)