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Material Issue 5: Corporate Ethics and Governance Structures
Basic Policy
The Sumitomo Forestry Group is reviewing its philosophy system to reflect globalization, diversification, and expansion of our business. Our sustainable management formulated based on our Corporate Philosophy, Our Values, and Code of Conduct also complies with international standards and initiatives as well as other social demands. We are also working to reinforce the mechanism for managing business risk—which also encompasses Group companies—by constantly managing prioritized risks through the Risk Management Committee while strengthening Business Continuity Management (BCM) system against disasters.
Management of Material Issue 5
Within our Mid-Term Sustainability Targets, our Material Issue 5 “Reinforcing risk crisis and compliance structures” is reflected in one broad goal, which we incorporate into our management practices through inclusion in annual activity policy and measures for each department. We also assess the impacts that the material issue has on society and the environment.
Targets of Material Issue 5
- Reinforcing risk crisis and compliance structures
Impact on Society and the Environment
| Targets of Material Issue 5 | Impact (Influence) |
|---|---|
| Reinforcing risk crisis and compliance structures |
|
Management of Each Target
Reinforcing Risk Crisis and Compliance Structures
| Specific steps based on issues and strategies |
Indicators for Evaluation | Managing department | FY2019 target |
FY2019 result |
FY2019 value |
FY2020 target |
FY2021 target |
|---|---|---|---|---|---|---|---|
| Progress check of prioritized risk items set by the Risk Management Committee and share materialized risks | Progress management for prioritized risks (conducted on a quarterly basis by the Risk Management Committee) (%) | General Administration Department | 100 | 100 | 〇 | 100 | 100 |
| Understand the extent of compliance awareness and enhance channels for reporting misconduct and compliance violations | Regular implementation and phased deployment of compliance awareness surveys | General Administration Department | Sumitomo Forestry | Sumitomo Forestry | 〇 | Major group companies in Japan | All group companies in Japan and some group companies overseas |
| Obtain external certification for Business Continuity Management (BCM) | Obtaining resilience certification |
General Administration Department | Sumitomo Forestry | Not obtained | ✕ | Sumitomo Forestry and all major domestic group companies | All major domestic group companies |
| Analyze and disclose potential financial impact from climate-related risks that could (potentially) have on the organization | Conduct scenario analysis and disclosure consistent with guidance from the Task Force on Climate-related Financial Disclosures (TCFD) | Sustainability Department | Re-examination of analysis results and expansion of scope of application for two sectors: domestic housing business and timber and building materials business | Implement for two sectors, domestic housing business and timber and building materials business | ✕ | Re-examination of analysis results and expansion of scope of application for two sectors: domestic housing business and timber and building materials business | Completion of re-examination of analysis results for all business departments, and incorporation into the subsequent mid-term plan. |
* Rating
Achieved：◯ Not achieved but improved from previous year：△ Not achieved and declined compared to previous year：✕
Toward the Future
In fiscal 2019, Sumitomo Forestry conducted a questionnaire to survey employee awareness about compliance. In fiscal 2020, we plan to analyze these results to assess the current state of understanding, better the corporate climate, and heighten awareness. To expand the scope of this assessment, we plan to conduct the same questionnaire at some of our affiliated companies. Although Sumitomo forestry did not obtain the Resilience certification in the year under review, we and our affiliated companies aim to acquire the certification in fiscal 2020.
We implemented TCFD scenario analyses in two departments: the domestic housing business as well as the timber and building materials business. In fiscal 2020, we plan to re-analyze these two departments while expanding the scope and disclosing information about these measures.
Code of Couduct Guidebook
- This is the guidebook to promote the embracement of Sumitomo Forestry Group Code of Conduct to our employee.