Governance | Global Enterprise Risk Management
Business Continuity (BCP), Crisis Management

To achieve its vision of providing social and customer value, the safety and security of employees and the continuity of business operations are top priorities of Bridgestone. By sensing, assessing, prioritizing, and managing potential risks, Bridgestone works to protect its employees while also positively driving business success. To advance this knowledge organization-wide, Bridgestone conducts regular training and regularly reviews business continuity plans (BCPs) and controls.

Enhancing business continuity planning and crisis management systems is an important aspect of enterprise risk management (ERM), which is an increasing focus area as the world grapples with natural disasters, climate change, and the effects of geopolitical conflicts. Bridgestone is actively engaged in addressing these challenges.

Bridgestone is continuously working toward its goals of fulfilling its mission of Global Enterprise Risk Management and prevent and mitigate risks. The company has established measurable KPIs for each of these goals related to Business Continuity and Crisis Management, which include:

1. Continuing to develop and strengthen global and regional programs, including enhancing business continuity planning and crisis management, and putting technology in place to support these programs.
2. Lowering the recovery time objective (RTO) for the maximum acceptable downtime for business-critical functions.
3. Minimizing recovery point objectives (RPO) to limit the maximum amount of data loss.
4. Increasing the completion rate of business impact analyses (BIAs) and site response plans to ensure plans are reviewed and updated.
5. Improving response time to reduce the time taken to respond to a crisis.
6. Decreasing crisis resolution time to shorten the time from the onset of a crisis until normal operations resume.

A prompt initial response is essential for business continuity. In preparing for this response, Bridgestone gives top priority to its employees’ health, safety, and security; minimizing business losses; and anticipating business-impacting events that may occur in the supply chain. To achieve a quick recovery from crisis, Bridgestone has established a tiered response system based on the specific crisis situation and its severity. Additionally, it has established a system for identifying and implementing countermeasures and protocols. This system enables a prompt initial response to ensure business continuity/early recovery and drives initiatives for continuous improvement, making use of past experiences and lessons learned.

Bridgestone continues to improve its risk-control processes that strengthen the management team’s ability to make informed, timely, and far-reaching decisions. It is also implementing all-hazards business continuity planning in each region. All-hazards business continuity planning prepares the organization for all types of threats and vulnerabilities to prevent supply chain disruption, rather than planning for specific scenarios.

Bridgestone has developed a common, aligned framework and standards for enterprise risk management, business continuity, and crisis management. These standards address the governance and oversight of programs, the program framework, and technology, as well as Bridgestone’s ability to identify, assess, mitigate, and respond to significant enterprise-wide risks.

It also enhanced its global approach to emergencies including emergency action reports (EARs), the Group-wide internal quick-reporting system for significant incidents.

Going forward, Bridgestone will continue to improve its operational framework to strengthen business continuity and crisis management processes.

Bridgestone supports the Task Force on Climate-related Financial Disclosure (TCFD) and has been participating in the Taskforce on Nature-related Financial Disclosures (TNFD) Forum since March 2022.

As the world becomes increasingly concerned about climate change and the loss of natural capital, there is a growing movement towards a de-carbonized society, as exemplified by the Paris Agreement. Additionally, efforts to achieve a nature-positive world, as outlined in the Kunming-Montreal Global Biodiversity Framework, have gained momentum.

In this context, Bridgestone is working to comprehensively assess and manage its dependencies, impacts, risks, and opportunities related to climate and natural capital. It is incorporating these factors into its business strategies and providing more sophisticated disclosure.

Based on the recognition of these risks and opportunities, Bridgestone is working to establish a unique Sustainability Business Model that links initiatives focused on the realization of carbon neutrality to a circular economy, and promotes a nature positive world to its business across the entire value chain. Furthermore, Bridgestone aims to evolve the Sustainability Business Model, transforming it into a regenerative model to help realize a nature-positive world where the loss of natural ecosystems can be stopped and reversed.

Specifically, Bridgestone is working on mitigating transition risks by implementing measures, such as reducing greenhouse gas emissions across the entire value chain, while at the same time working to address physical risks through adaptive measures.

The table below outlines the climate change and nature-related physical and transition risks associated with Bridgestone’s business and operations.

For details of disclosure information recommended by TCFD and TNFD, see the “TCFD and TNFD Index” section.

Bridgestone believes that proactively protecting corporate assets forms the basis of good corporate management, especially in the case of a natural disaster. Initiatives in this area also contribute to mitigating risks to employees and communities, thereby fulfilling social responsibility requirements. Each region of Bridgestone formulates a BCP in case of a natural disaster or extreme weather event and regularly conducts initial response training. The following are examples of natural disasters targeted by each region, but not limited to these.

• Japan: Earthquakes (including tsunamis), floods, and typhoons
• America: Hurricanes
• Europe: Extreme heat
• Asia: Floods

Bridgestone’s globally dispersed operations expose it to a broad range of risks. One of these is the risk of pandemics ― not just COVID-19. Since 2013, Bridgestone has formulated BCPs to address the spread of all sorts of severe infectious diseases of potentially pandemic proportions.

The BCPs have effectively guided the response to the 2013 avian influenza outbreak in China and ensured the well-being of the employees and business operations there. In 2014 and 2015, Bridgestone received global recognition for its successful efforts to control the spread of Ebola hemorrhagic fever at its Liberia-based natural rubber producing operation. Firestone Liberia not only saved lives, supported education and response efforts in surrounding communities, and partnered with the Government of Liberia and NGOs to detect and fight the disease, but also managed to keep its business running at the same time. This accomplishment was documented and published in a case study by Northwestern University's Kellogg School of Management, which is now a regular part of the crisis management curriculum for MBA students.

In 2020, Bridgestone launched a crisis management committee composed of the Global CEO, Joint Global COO, and key management to review emerging information on various changes associated with the spread of COVID-19 and to make swift decisions to protect employees’ health and safety and minimize business impact. The committee continued for the required period, and shared best practices to drive consistent responses to challenges faced in locations around the world.

Furthermore, Bridgestone took advantage of its Business Continuity Risk Management Working Group (BCRM WG) to implement a unified, global crisis management and business continuity approach ensuring consistency of response, anticipating and preparing for coming risks and challenges, and sharing best practices on a global level.

Among other things, the WG drove prompt access in the different SBUs to critical personal protective equipment; implemented a common case-tracking and reporting protocol to identify trends and business impacts; established global policies on travel as well as meetings and events; monitored governmental regulations to ensure compliance; assessed the impact of compounding events such as holidays in Southeast Asia and civil unrest in the United States; and provided weekly updates to the Executive Committees of each SBU.