Risk Management

Zeon positions the appropriate identification, across the organization, of the wide range of risks that may affect its business operations, as well as their prevention and mitigation, and prompt and appropriate responses when risks materialize, as a key management issue. For this purpose, we continuously develop and operate a company-wide risk management framework, and manage the entire process in an integrated manner, from identification of potential risks to prevention, response in the event of occurrence, and measures to prevent recurrence. In addition, we work to enhance our resilience and create sustainable corporate value by preparing for key risks such as compliance, information security, and business continuity, strengthening our response to emerging risk areas including climate change and human rights, and maintaining an early detection system through our internal reporting (whistleblowing) framework.

We have established the Risk Management Committee as the body responsible for building and operating a company-wide risk management framework. The Committee works to identify, assess, and prevent potential risks that could affect business activities, and promotes the development and operation of a company-wide system for responding promptly and appropriately to, and resolving, risks that have materialized.

In Group-wide risk assessments, evaluations are conducted taking into account business content and regional characteristics, and risks related to corruption in general, including bribery and fraudulent activities, are also covered. This enables a comprehensive understanding of governance-related risks inherent in business operations and supports appropriate control activities. Individual risks that have materialized are handled, on their own initiative, by the departments responsible for managing those risks, and are reported to the Risk Management Committee together with the root-cause analysis, the formulation of measures to prevent recurrence, and the status of horizontal deployment across the Group. The Risk Management Committee monitors whether risk management across the Zeon Group is being appropriately controlled and prepares a company-wide Risk List. Based on this list, the Committee regularly reports on control activities related to critical Group-wide risks to the Management Committee and the Board of Directors to confirm the effectiveness of risk management. In addition, each organization prepares its own Risk List, identifies both Group-wide risks and risks specific to that organization, and implements necessary control activities based on this identification. The Risk Management Committee compiles evaluations and control activities for these individual risks and shares them with relevant departments, thereby enhancing the effectiveness of Group-wide risk control activities.

Risk Management Structure

To minimize the impact on business continuity from disasters such as earthquakes and severe storm and flood damage, we have formulated a Business Continuity Plan (BCP) and conduct training to enhance its effectiveness. In FY2025, we conducted two company-wide emergency response headquarters drills and two company-wide emergency response headquarters secretariat drills. Through these drills and other activities, we verify the effectiveness of our BCP and work to strengthen our resilience to disasters.
In addition, each business division and plant has formulated its own BCP and established systems that enable a rapid response in the event of an emergency. Furthermore, through continuous review under our Business Continuity Management (BCM) and the implementation of our own training programs, we strive to maintain and enhance the effectiveness of our BCP.

We have put in place a confidential whistleblowing system to identify information about potential risks as early as possible so that appropriate action can be taken. Reporting channels for risk information include internal channels such as reporting through superiors and reporting directly to the Compliance Department. We have also set up the web-based Compliance Helpline, which allows anonymous reporting. In addition, we have established the Lawyer HOTLINE, with an outside attorney serving as the contact point, broadening the options available to whistleblowers (1 to 4 in the flowchart).
This whistleblowing system accepts reports related to overall compliance, including harassment, human rights violations, corruption and bribery, theft, fraud, threats, insider trading, and information security issues.
Upon receiving a report, the Compliance Department investigates the facts regarding the report, while giving the utmost consideration to the privacy of the whistleblower and maintaining confidentiality, and, based on the results, takes appropriate actions such as instructing relevant internal departments to implement countermeasures.
We also make the system known to employees, including its purpose, so that whistleblowers who report in good faith are not subjected to dismissal, reassignment, discrimination, or any other disadvantageous treatment because of their report.

Whistleblowing flowchart