Ensuring business continuity
- Prevent and mitigate operational risks
- We anticipate, prevent, and mitigate risks, but when crises arise, we protect our people, property, and profits.
Overview of Risk Management Activities
The Bridgestone Group broadly divides risks into two categories: business strategic risks, which are related to management decision-making, and operational risks, which are related to daily operations. The former is handled through business operations, while the latter is handled by the Chief Risk Officer (CRO), who has overall responsibility for managing risks. In this way, the Bridgestone Group promotes risk management activity initiatives.
Risk management activities promote the identification, prevention, and reduction of risks under normal circumstances, as well as the continuation of business via appropriate responses and the creation of structures enabling the swift resumption of business in emergency situations.
Activities under Normal Circumstances
The Bridgestone Group promotes the appropriate management of important risks common for the Group, as well as carefully crafted activities that consider the scale and unique characteristics of each business office and subsidiary through Group Global unified activities and autonomous activities at divisions and SBUs.
In terms of unified activities, we began identifying risks at the Bridgestone Group (excluding companies in which Bridgestone has an equity stake of 50% or less) in 2009.
From then on, we select important risks common for the Group from among those identified and promotes unified Group-wide countermeasures every year. These activities will continue to be conducted in 2016.
At the same time, to promote autonomous activities at divisions and SBUs, the CRO was established in each division and SBU to promote detailed risk management activities corresponding to the scale and unique characteristics of each business office and subsidiary under each division or SBU. To guide these activities, risk management guidelines are disseminated within each department and SBU amid ongoing improvements to these activities.
In addition, the Group Global CRO Meeting, attended mainly by CROs from each SBU, has been held annually since 2013. Participants in this meeting discuss and share information with each department and SBU with the aim of improving the level of risk management throughout the entire Group.
The Bridgestone Group formulates Business Continuity Plans (BCPs) to address important risks for the countries and regions where it operates with the aim of ensuring a swift initial response to emergencies, as well as business continuity and rapid recovery in the event of disaster.
To improve BCP effectiveness, since 2013 we have been promoting the creation of a structure to more effectively structure support coordination between subsidiaries in the same region when disaster occurs. In 2016, we will expand this structure to additional regions in an attempt to improve its effectiveness.
At the same time, in the event an emergency arises at any business office, we maintain a mechanism for providing the CRO with this information in a timely manner.
We are creating a structure to quickly and systematically respond in an emergency situation, which will be rolled out to the entire Bridgestone Group.
Bridgestone and subsidiaries in Japan promote BCP development and drills to prepare for major earthquakes, which are a significant risk in Japan.
Bridgestone has also established a BCP in preparation for a major earthquake in the Tokyo metropolitan area that would affect our head office, technical centers, and many other functions. We created a three pronged office framework approach (consisting of Kyobashi, Kodaira, and Yokohama) for emergencies, ensuring backup functions throughout. Emergency countermeasure organization drills are conducted in these three districts annually.
In 2015, evacuation points placing the highest priority on the preservation of human life and evacuation procedures were put in place at domestic facilities at risk in the event of a tsunami.
Emergency affairs office drill in Yokohama
In addition, since the Great Hanshin-Awaji Earthquake in 1995, Bridgestone has systematically implemented earthquake-resistance measures in buildings. This is to protect the lives of each of our employees, but we also believe that protecting production facilities and other corporate assets from destruction is the basis of good corporate management. In the interest of business continuity, these initiatives also go toward reducing risk to meet social requirements.
Since the Great East Japan Earthquake in 2011, we have again looked carefully into the vulnerability to disaster of building components such as ceilings and pipes. We have put in place our own standards in these regards and are proceeding with earthquake-proofing in a well-planned manner. We are also formulating and proceeding with similar measures at our operations overseas.
Response to New Types of Influenza and Other Severe Infectious Diseases
The Bridgestone Group has formulated BCPs to address the spread of new types of influenza and other severe infectious diseases that are potentially pandemic in scope.
During the 2013 outbreak of type H7N9 avian influenza in China, we held weekly meetings to ensure the consistent sharing of information about conditions. We also supported the creation and maintenance of BCPs for all subsidiaries throughout China.
In 2015, we revised our response standards in light of pandemic phase changes indicated by the World Health Organization, which announces epidemic levels, and in response to the China avian influenza and Ebola hemorrhagic fever. Going forward, Bridgestone will promote these initiatives throughout the entire Group to create a structure enabling a unified response to the spread of infectious diseases in all countries.