Risk Management

The Mitsubishi Rayon Group is aware that in order for the Group to meet public demands and sustain its development, it is essential for it to establish a mechanism for thoroughly understanding and managing various key risks both within and outside its business, in other words a "risk management system." With this awareness, the Mitsubishi Rayon Group has undertaken the following activities for managing risks.

Risk Management System

The Mitsubishi Rayon Group’s risk management initiatives respond to both important operational risks from a companywide perspective and risks inherent in each business activity undertaken by the Group.

(1) Risks That Significantly Impact Operations

Taking into account the social environment and other factors, the Risk Management Committee sets important companywide risks yearly and appoints the competent department to implement key measures in response to each risk.

(2) Risks specific to each department

Each department, division, production center, plant, or laboratory develops its own risk measures in accordance with the company-wide risk management standards and manages risks with a bottom-up approach.
Specifically, each department, division, production center, plant, or laboratory is endeavoring to reduce risks by implementing the PDCA (plan-do-check-act) cycle consisting of (1) identifying risks, (2) developing risk measures, (3) implementing risk measures, (4) assessing the effectiveness of risk measures, and (5) carrying forward existing risk measures to the next year and creating new measures.

For each risk, the Audit Office checks the effectiveness of activities to develop and implement risk measures, aiming to improve the level of risk management activities. The progress of risk management activities is managed using a database system, with the aim of effectively and efficiently carrying out risk management operations by sharing risk information within the group, including overseas group companies. In addition, the level of risks identified is evaluated based on a matrix consisting of the degree of influence and the frequency of occurrence, and the results of this evaluation are reported to the Risk Management Committee.

Risk Management Chart

Risk management activities at overseas group companies

We are facing a need to carry out global business operations, covering global markets, by promoting cooperation among production and marketing centers in Japan, Asia, the U.S., Europe, and other countries and regions in the world. Consequently, from the perspective of securing the soundness of business management, it is becoming more and more important to develop and strengthen risk management and corporate governance functions.
The Mitsubishi Rayon Group manages risks on a unified, group-wide basis, covering both domestic and overseas group companies. For overseas areas where there are many group companies, and a high level of risk management is required, the group is carrying out risk management activities together with Mitsubishi Chemical Holdings America Inc. (in North America), Mitsubishi Chemical Holdings Europe GmbH. (in Europe), and Mitsubishi Chemical Holdings (Beijing) Co. (in China) and other regional supervisory companies of the Mitsubishi Chemical Holdings Corporation group. Furthermore, one of the most important challenges regarding the Mitsubishi Rayon Group’s business operations is to develop and strengthen risk management and corporate governance functions in China. The group is dealing with these challenges by providing Mitsubishi Rayon (Shanghai) Co. with functions to develop and promote risk management plans.

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Business Continuity Plan (BCP)

Activities relating to an initial response (crisis management) plan and a business continuity plan (BCP) to prepare for a huge earthquake directly hitting the Tokyo metropolitan area and a major Nankai Trough earthquake

In order to prepare for a situation where the functions of the Head Office are lost because a huge earthquake hits the Tokyo metropolitan area or a situation where the functions of production centers and other offices located in the part of Japan that is west of Shizuoka Prefecture are lost because a major Nankai Trough earthquake occurs, we have developed a crisis management plan to secure the safety of employees and a BCP-related basic action program covering all departments, etc., of the Mitsubishi Rayon Group.
Under the BCP-related basic action program, each department of Mitsubishi Rayon has separately assigned a supporting department that will take over its operations in case it is hit by an earthquake. After a BCP is implemented, supporting departments in each area will voluntarily launch support operations and will provide business continuity support until the earthquake-stricken departments restore their operations. Through these activities, we aim to restore the lost functions as fast as possible.

*The green line indicates the fastest possible restoration of pre-earthquake operations.

Crisis management training

We periodically provide crisis management training simulating a situation where a huge earthquake directly hits the Tokyo metropolitan area or a major Nankai Trough earthquake occurs during work hours. If challenges are discovered and clarified through training, they are incorporated in the next crisis management plan (the revised edition), aiming to improve its effectiveness.

BCP training

We periodically provide BCP training simulating a situation where a huge earthquake directly hits the Tokyo metropolitan area, based on cooperation among supporting departments for the Osaka Branch, the Toyohashi Production Center, the Toyama Production Center, the Otake Production Center, and the Sakaide Production Center, departments at the Head Office (which is assumed to be damaged by the earthquake), and the Otake Crisis Control Center.
In the training, a responsible person at a supporting department confirms failure of the functions of the Head Office in Tokyo due to an earthquake, implements a BCP, and instructs a person in charge to begin support operations. Subsequently, the person in charge at the supporting department notifies a client (in the training, a department in charge at the Head Office acts as a client) of the taking over of operations by the supporting department, carries out shipment and other operations on behalf of the Head Office, and enters the results of these operations into an in-house “database for a huge earthquake hitting the Tokyo metropolitan area.” Then, the responsible person at the supporting department reports the results of these operations, which are carried out on behalf of the Head Office under the BCP, to the Otake Crisis Control Center, and a person in charge of public relations at the Osaka Branch provides information to outside parties through the website.
Meanwhile, to prepare for a major Nankai Trough earthquake, the Otake Production Center, the Toyohashi Production Center, and the Yokohama Production Center are eagerly examining BCP-related training programs by carrying out activities such as determining the level of anticipated damage in each area and creating BCP-related manuals.

Distribution of handbooks

We have created a handbook describing basic actions to be taken if a huge earthquake occurs and distributed it to all employees of the Mitsubishi Rayon Group. (The first edition was published in October 2014.)

Challenges under review

Improvement of the effectiveness of the crisis management plan and the BCP in order to prepare for a huge earthquake directly hitting the Tokyo metropolitan area
Establishment of a crisis management plan and a BCP at each production center in order to prepare for a major Nankai Trough earthquake

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Information Security

The Mitsubishi Rayon Group established its Information Security Policy in fiscal 2004 and is undertaking activities centered on the Information Security Committee to increase information security. From the perspective of internal control (J-SOX), the Group inspected mobile devices and tightened control of information access rights in fiscal 2009. The Group has expanded the application of improved physical security measures in areas such as facilities, equipment and devices, with the use of IC cards※1 called PIAS※2. We will continue to promote PDCA cycles to reinforce information security activities.

※1  IC card: A card mounted with integrated circuits (ICs) for data storage and computation

※2  PIAS: Physical Security Integrated Admission System, the Mitsubishi Rayon Group’s unified access control system