Risk Management
Risk Management Structure
Our Risk Management Committee, chaired by the President, was established to identify, evaluate, and respond to risks facing the entire Group. Additionally, we formulated the Regulations of the Risk Management Committee to clarify the roles and responsibilities of the committee.
The Risk Management Committee prepares a risk management action plan each fiscal year and monitors its progress. Audits on the status of risk management are carried out by the Internal Audit Department, and the results are reported to the Risk Management Committee.
The Risk Management Committee takes appropriate action, when necessary, based on those results, and reports the results of the audits to the Board of Directors.
Overview of the Risk Management Committee Implementation Framework
Sumitomo Osaka Cement Group Individual departments and affiliated companies
Risk Management Officer
Chief Risk Management Officer
Risk Management Committee
Chair: President Secretariat: General Affairs Department
Business Continuity Initiatives
Natural disasters (large-scale earthquakes, etc.) Since the introduction of its risk management framework in fiscal 2006, the Sumitomo Osaka Cement Group’s business continuity planning (BCP) has been based on the assumption that a large-scale disaster, such as a major earthquake, would occur. Our BCP is formulated and implemented by our head office, the Kochi, Ako, Tochigi, and Gifu plants, Hachinohe Cement Co., Ltd., and the Advanced Materials, Optoelectronics, and Cement-Related Products divisions. In the event of a major earthquake-in addition to our initial response measures to earthquakes and tsunamis-we take steps to maintain company-wide command and control functions, as well as to back up our system data.
Furthermore, for departments where we have
adopted the BCP system, we conduct regular training at each facility every year, and make continuous improve-
protecting tangible and intangible information assets, as well as information infrastructure related to business activities, from external threats, and of promoting business activities safely and smoothly. The Group
is working on information security activities under a management system based on these rules.
Due to the need for timely response to external cyberattacks, which have become a major issue in recent years, we have been working to strengthen information security by appropriately introducing new security services and other such measures, and by establishing the infrastructure necessary to use them. Additionally, in response to cyberattacks that are becoming increasingly sophisticated and diverse, we will conduct regular status assessments, and implement improvements and supplementary measures.
We will also strengthen measures against internal information leaks caused by employees, either intentionally or due to negligence, and build a safe and secure information system environment that takes business productivity into consideration.
Moreover, in the event of an information security incident, the Company has established procedures for setting up a response team linked with the relevant departments or groups, and for taking necessary actions in order to minimize the damage.
General Affairs Department Manager
General Affairs Department Executive Officer
President
Board of Directors
Digital Advancement Department, Systems Administration Group Leader
General Affairs Department General Affairs Group
Planning Department Planning
IR Group
Department in charge of damage information
Sumitem Infrastructure Team Leader
General Manager of the Digital Advancement Department
Officer in charge of the Digital Advancement Department
General Affairs Department, General Affairs Group Leader
Computer Security Incident Response Team (CSIRT) Structure
Major Initiatives in Fiscal 2024
Review of Risk Management
The risk environment impacting the Company is changing, with natural disasters becoming both more frequent and more severe due to recent climate change, the emergence of new highly virulent infectious diseases, and the increased risk of information leaks due to rapid changes in work styles. Accordingly, in light of these circumstances, as well as to align with our “SOC Vision 2035” that we formulated in 2023, we revised our risk management framework in fiscal 2024.
To minimize the frequency of risk occurrence and, in the unlikely event that a risk does manifest, to minimize the impact of the resulting damage, the Risk Management Committee rigorously implements the PDCA cycle by monitoring from various angles whether
individual risk issues and corresponding mitigation measures are being properly applied, and will continue to manage progress using a countermeasures roadmap within the Group.
Moreover, to respond flexibly to changes in the business environment, we will continue to work toward
operty
Environmental pollution
information
Geopolitical risks
Public relations/media
Quality risks
Human resources/ labor issues
Financial risks
Social risks
Human error
infectious diseases
idents
Securing human resources Human rights/harassment DX
Compliance
Major inc
carbon neutrality
Information security
Intellectual pr Leak of technical
Safety and health/
Market risks
Global warming/
Natural disasters
Sustainability
Degree of damage/impact
Medium
High
Risk Mapping
reducing the risks surrounding the Company by regularly identifying company-wide risks and reviewing the identification of priority risks on an annual basis.
Introduction
Status of Priority Risks
In our risk mapping process, we identify the significant risks that should be addressed as a priority, and in fiscal 2024 we pinpointed “natural disasters,” “information security,” and “human rights and harassment.”
We work to mitigate risks by implementing a wide
Value Creation Story
range of measures. For example, regarding natural disasters, the Tochigi and Gifu plants completed their integration of the BCP system. For information security, we established a dedicated Digital Advancement Department, while for human rights and harassment, we adopted human rights due diligence protocols and set up a human rights hotline.
Value Creation Strategy
In terms of priority risks for fiscal 2025, we will focus on taking measures against the same three risks as highlighted in fiscal 2024, but with the addition of “major incidents.”
Governance
Low
ments such as reviewing manuals to further reduce risk.
July 2024: Risk management review
Low Medium High
Data Section
Probability of occurrence
In our head office BCP training, we conduct exercises to simulate information gathering and sharing by related divisions at the head office in the event that a Nankai Trough earthquake impacts our Kochi Plant, and confirm each division’s understanding of their roles.
Information Security Measures
Under the “Basic Rules on Information Management,” which defines the basic matters required for information management, the Group has established its “Basic Rules on Information Security” for the purposes of
September 2024: Awareness survey on potential risks November 2024: Computer security incident response
training (CSIRT training)
January 2025: BCP formulation for the Tochigi and
Gifu plants
March 2025: Head Office BCP training (simulating
a Nankai Trough earthquake: cooperation with sites on the Pacific side)
Note: In addition to the above, BCP and fire drills will continue at individual sites.
Priority risks
Important risks
Risks
Basic Policy on the Protection of Personal Information
Following the basic principles of Japan’s Act on the Protection of Personal Information, we consider the appropriate handling of personal information to be an important management task and, as such, we have established our own personal information protection policy. In accordance with this basic policy, we have
established an in-house organizational structure for the proper handling and protection of personal information, as set out in our “Regulations for the Protection of Personal Information.”
Information Disclosure
Engagement with shareholders and investors requires that they have an understanding of the Sumitomo Osaka Cement Group’s current situation and management plans through accurate and timely disclosure of information. It is also important for them to broadly understand our businesses. We carry out investor relations (IR) activities using a wide range of tools, including briefing sessions and facility tours.
Disclosure Policy
Basic Policy
Sumitomo Osaka Cement Co., Ltd. (“the Company,” “we” or “our”), conducts fair and equitable information disclosure in a timely and appropriate manner. In order to provide accurate information to stakeholders, including our shareholders, the Company ensures that information disclosed is not boilerplate or lacking in detail.
Disclosure Methods
The Company discloses information required for timely disclosure via TDnet (Timely Disclosure Network) and press releases, as well as on the Company’s website, in a timely manner, in compliance with relevant regulations such as the Financial Instruments and Exchange Act and based on the Timely Disclosure Rules as defined by the Tokyo Stock Exchange.
For information that is not covered by the Timely Disclosure Rules, the Company makes every effort to disclose information in a prompt and fair manner via their website and the media, if the Company deems that the information is useful for shareholders, investors, and other stakeholders.
Quiet Period
The Company sets a quiet period from approximately two weeks before the final settlement date for each fiscal quarter, in order to prevent the leakage of financial results information and to ensure fairness, during which period the Company refrains from commenting on or answering questions related to the financial results. Even during these quiet periods, however, the Company will disclose information on amendments to forecasts of financial results or dividends in a timely manner in accordance with the listing regulations set forth by the Tokyo Stock Exchange and other rules.
Feedback to Management
The Company actively engages in mutual communication with capital market participants such as shareholders, investors, and securities analysts. The division in
charge of IR conveys the opinions gleaned from such communication to management executives and the Board of Directors as feedback that is considered when formulating the management plans.
Status of Dialogue with Shareholders and Investors We hold financial results briefings on our annual and interim results in order to foster understanding of the Group’s management status among institutional investors and analysts. In addition, we aim to reduce information asymmetry in the market and to improve corporate value by promoting prompt and fair information dissemination and dialogue with shareholders, other investors, and securities analysts, including sitting for individual interviews with securities analysts
and institutional investors, both from Japan and overseas. The following is a summary of the Company’s dialogue with shareholders and investors in fiscal 2024.
Main correspondents
Financial results briefings: President, officers in charge of the Corporate Planning and Administration Departments, the division in charge of IR
Individual dialogue: Officers in charge of the Corporate Planning and Administration Departments, the division in charge of IR
Overview of shareholders and investors with whom we have conducted dialogue
We held 127 dialogue sessions with both domestic and foreign institutional investors, totaling approximately 87 companies.
A detailed breakdown of our disclosure policy is available at the following link:https://www.soc.co.jp/ir/disclosure/
Main themes and concerns during our dialogue sessions Status of negotiations on raising cement sales prices, trends in the price of coal used, trends in domestic cement demand, the state of the electrostatic chuck business, and our approach to shareholder returns, among others.
Status of feedback to management and the Board of Directors regarding views expressed during dialogue sessions
Opinions obtained through dialogue with shareholders and investors are reported to the Board of Directors on a quarterly basis, and are used to examine matters requiring improvement, as well as to formulate management plans and strategies.
Enhancement of financial results presentation materials
Examples of topics discussed at our financial results briefings
Cement price hikes and future outlook
Electrostatic chucks in the
Advanced Materials Business
Differences between business-specific medium-term management plan targets and the current fiscal year plans
We endeavor to provide comprehensive financial results presentation materials to help deepen understanding of our business performance and management. We are working to improve these materials by including key points about our business performance, with an emphasis on clarity. Additionally, starting from the full-year results for fiscal 2024, we will be publishing transcripts of our financial results briefings for institutional investors and securities analysts-including Q&A sessions-on our website. This initiative aims to ensure fair information disclosure and to promote understanding, making the content accessible not only to attendees but also to a broader investor audience.
Explanatory Materials for Financial Results https://www.soc.co.jp/ir/document/document03/
[Explanation and Q&A] FY2024 (Ended March 31, 2025) Financial Results Briefing (External Website) https://finance.logmi.jp/articles/381891 (in Japanese only)
AloJapan.com