The Seiko Group identifies Group Significant Risks and works to maintain and strengthen its risk management structure to quickly and appropriately address a variety of business risks in relation to the operation of its businesses.
Group Risk Management Structure
In order to perform centralized management of risks that could greatly influence the Group’s business, the Seiko Group is engaged in the development and strengthening of the risk management structure for the entire Group as well as responses to risks that must be addressed in a cross-organizational manner, led by the Risk Management Committee, with the president as chairperson. In addition, each operating company independently promotes risk management, while the Company’s Risk Management Committee supports the risk management at each company through collecting risk information and managing the status of responses to the risks.
Furthermore, for the smooth promotion of Group risk management in close cooperation and coordination among the Group, the Group Risk Management Committee, made up of the presidents of each operating company, has been established to verify and share information on the risks facing the Group.
We have also established the Crisis Management Manual in preparation for times of crisis. In normal times, we have set out a system capable of responding to crises, such as prompt collection of the necessary information for an appropriate response.
For more detailed analysis of climate-related risks, the Sustainability Committee conducts scenario analysis to identify, assess, and resolve particularly impactful climate change risks for Group companies, and is implementing measures to address these risks with each Group company.
In addition, the Corporate Ethics Committee chooses the risks to focus on addressing based on information that it collects both internally and externally regarding corporate ethics and compliance risks. The committee then promotes risk countermeasures while cooperating with Group companies.
Group Risk Management Structure
Business Risks
Risks that may seriously affect the operating results and/or financial position of the Group are outlined below. The Group considers brand-impairment risks and risks that affect the safety and health of employees and others to be critical risks. Both are mediumterm risks, apart from the risks that have a significant impact on the business results in short term.
- Risks associated with economic fluctuations and other changes
- High dependence on procurement from specific suppliers
- Market environment of the DS Business
- Country risks pertaining to manufacturing bases overseas
- Dependence on sales to major customers
- Shortages and increase in prices of resources
- Quality issues and production liability
- Intellectual property rights
- Currency exchange rate fluctuations
- Interest rate fluctuations
- Market price fluctuations
- Environmental issues
- Information security
- Natural disasters and impacts of infectious diseases
- Compliance risks
Information Security
Given the increasing threat of cyberattacks such as targeted email attacks and malware due to changes in the ICT usage environment, the Group is working on strengthening ongoing measures and improving employee awareness about information security by coordinating control across Group companies.
In addition, in the environment for utilizing information systems, we aim to provide a safe and stable environment by consolidating into data centers equipped with information security and disaster countermeasures, and also strive to improve server efficiency and redundancy through virtualization.
Initiatives to Address Significant Risks
We define risks that could cause tremendous loss in business terms to the management of each Group company as Significant Risks. The Risk Management Committee of each Group company selects the Significant Risks each fiscal year and addresses them led by the departments responsible for the risks.
The Corporate Ethics Committee and the Sustainability Committee address Significant Risks that could have a major impact on compliance and sustainability, respectively.
The SEIKO GROUP CORPORATION Risk Management Committee selects Group Significant Risks as Significant Risks to be addressed on a Group-wide basis from among these Significant Risks, establishing measures to prevent and address Group Significant Risks.
The Group Risk Management Liaison Committee, comprising risk management personnel from Group companies, supports the promotion of measures to address the Significant Risks of each Group company through collaboration and cooperation among all Group companies.
Group Critical Risks for FY2025
Details of Risks
- Operational risks due to IT problems (such as cyberattacks) and major IT infrastructure issues
- Leaks and theft of personal Information
- Natural disaster and accident risks that require business continuity plans (BCPs)
- Risks of damage to corporate value due to governance failures
- Risks of dependence on specific suppliers in the supply chain