Risk Management

In addition to proactively minimizing the numerous management risks that surround the company, our corporate group implements comprehensive risk management to reduce damage in the case of an occurrence. In recent years, social demands for sustainability have increased, and the management risks faced by companies have further increased. Against this backdrop, our corporate group aims to achieve sustainable growth and enhance corporate value by appropriately managing these risks.
We have developed a robust risk management system to identify risks that impact our business and implement appropriate countermeasures and management.

We have established a "Sustainability Council" as part of the group's risk management structure to discuss sustainability-related risks and opportunities. Under this council, there are the Risk Management Committee, Environment Committee, Human Rights and Compliance Committee, Occupational Health and Safety Committee, Quality Assurance Committee, and Responsible Procurement Committee, each of which is responsible for specific risks.
The role of the Sustainability Council is chaired by the President and CEO, who serves as the chairman and manages all risks as the chief risk officer. Executive officers serve as members, and the executive officers in charge appropriately respond according to the characteristics of the risks.
The Corporate Planning Department is in charge of the secretariat, overseeing the committee's operations and providing support. Sustainability meetings are held on a quarterly basis, with the chairman reporting deliberated matters to the board of directors. The chairman provides the executive officer in charge with recommendations and proposals as needed. This strict system ensures early detection of risks and appropriate responses.

The Sustainability Council controls each committee and manages risks for the entire group in an integrated manner. Key risks include those related to overall corporate activities, financial activities, human rights and occupational health and safety, information storage management and information system-related activities, sales activities, the environment, purchasing activities, and the supply chain.
The Risk Management Committee conducts risk assessments and develops, implements, and continuously monitors response plans in addition to implementing ERM across the entire Furthermore, the Environmental Committee formulates prioritized targets and action plans addressing risks related to the global environment, such as climate change, and regularly reviews and improves the plans.
In 2024, third-party CSR audits based on international standards were conducted at our factories in Japan. Through these audits, we identified specific risks that must be addressed in order to fulfill our corporate social responsibility. Based on the results of these audits, we will implement corrective measures.
Based on company-wide ERM and CSR audits, we are implementing measures to (1) develop and strengthen our environmental management and (2) develop and strengthen our human resources strategies as particularly important issues in order to prevent risks and build a foundation for fulfilling our responsibilities as a company.

As part of the group's Business Continuity Plan (BCP), an action plan is being developed for use in the event of a disaster or other emergency. Risk management involves four processes: "risk identification," "analysis and assessment," "response and countermeasures," and "response monitoring and improvement." Through these processes, we strengthen our system to minimize the impact of risks and continue business activities. We consider BCP, which includes preparations for various risks such as natural disasters, social turmoil, and pandemics, to be an important element for enhancing corporate resilience.

On April 25, 2024, our company received an administrative order from the Consumer Affairs Agency pursuant to Article 7, Paragraph 1 of the Act against Unjustifiable Premiums and Misleading Representations with respect to "MoriLabo Pollen Barrier Stick," "MoriLabo Pollen Barrier Seal," "MoriLabo Pollen Barrier Spray," and "MoriLabo Night Care Pollen Barrier Pot." In response, our corporate group has completed all measures related to the order and is working on measures to prevent recurrence. Specifically, we are reviewing our internal processes and working on measures to ensure appropriate labeling and accurate information provision to customers.
Our group will continue to make efforts to flexibly respond to changes in the business environment through risk management and realize sustainable corporate activities. We will continue to raise awareness of sustainability and strengthen our risk management system in cooperation with internal and external stakeholders to appropriately manage risks, enhance corporate sustainability, and fulfill our social responsibilities.