Mitsubishi Chemical HoldingsTHE KAITEKI COMPANY

Risk Management

While the word risk can be defined in various ways, the MCHC Group defines risks as “potential events that could, during the course of corporate activities, undermine public trust in or the corporate value of the MCHC Group”.
We recognize, analyze, and evaluate risks and prevent materialization of significant risks. We take measures to minimize the personal, economic and social damage arising in case of materialization.

Charter of Corporate Behavior

The MCHC Group Charter of Corporate Behavior, consisting of thirteen chapters, explicitly declares that we act with sound ethics and good common sense in every aspect of our corporate activities.
It also stipulates that we share the fundamental behavioral principles for sustainable development, our approach for major issues in contributing to the realization of KAITEKI, and the basic ideas and initiatives on the realization of KAITEKI, with our business partners and others.

  • ・Awareness and Responsibility
  • ・Accountability and Transparency
  • ・Legal Compliance and Fairness, Equitability, and Integrity
  • ・Valuing Stakeholders
  • ・Respecting Human Rights
  • ・Employment and Labor
  • ・Environment and Safety
  • ・Fair Business Practices
  • ・Customer Satisfaction
  • ・Information Management
  • ・Science and Technology
  • ・Community Involvement
  • ・Shared Standards

Risk Management

The MCHC Group is engaged in corporate activities with the objective of raising its corporate value. These activities are related to social situations, the global environment and other various external environments, but they involve potential risk.

Risk Management System

MCHC has in place a risk management system whereby the MCHC president is responsible for risk management across the entire Group based on the MCHC Group Risk Management Basic Rules. The status of management of significant risks and policy for risk management that affect the entire MCHC Group are reported and discussed by the Management Committee.
The contents of discussion are reported to the Board of Directors, as needed.
The presidents of operating companies are in charge of risk management at their respective Group companies, embedding the risk management systems at their Group and addressing issues through the Risk Management Committees of their respective operating companies.
Recognizing the importance of fostering risk control awareness of all officers, managers and employees, in addition to those in risk management divisions, everyone is expected to be involved in risk management from their respective standpoints.

Risk Management Process

1.Identification of risks

Identification of risks is undertaken by each department of every company in the Group based on the degree of impacts and frequency. When identifying risks, due consideration is paid to risks arising from internal conditions based on the type of business and characteristics of each company and external conditions such as the country’s political and social situations.
Furthermore, a unified system for each operating company has been established to capture the overall risks within the company and to address to them.

2.Risk assessment and measures

Each operating company prioritizes identified risks in order of importance for each company, examines countermeasures, and takes action at relevant management departments to mitigate risks. Senior managers also review the risks and undertake screening for risks (major risks) that could have a major impact on Group management via businesses and operations under their control. The relevant departments then implement appropriate risk measures as instructed.

3.Detailed examination of risk measures

Risk measures are periodically scrutinized, and measures for major risks in particular are reported to the MCHC president.


To ensure the proper administration of risk management systems, including these related processes, the Internal Audit Office at MCHC periodically audits the risk management system, and reports its findings to the MCHC president.

Measures Against Major Risks

The MCHC Group has isolated the following categories of risks as warranting priority measures. After identification of such risks, we take measures to avoid their incidence or to minimize the resulting damage if the risks materialize.


In order to entrench compliance within the Group, we have compiled rules and standards, such as the MCHC Group Charter of Corporate Behavior, published a compliance guidebook, provided education, training and seminars on compliance, performed audits, and opened a compliance hotline. At overseas Group companies as well, we endeavor to strengthen compliance by compiling rules and codes of conduct in accordance with the laws, regulations and social norms of each country.

Accidents in our facilities and injuries in workplace

Each operating site endeavors to prevent facility-related accidents by ensuring the soundness of facilities and equipment and proper operation of them through their appropriate maintenance as well as extensive education and training of operators. If an accident occurs, the Group works to avoid recurrence by analyzing the cause, taking measures, and verifying their effectiveness through inspections or maintenance patrols. Moreover, the Group works to prevent accidents by applying these measures laterally to similar facilities and equipment or operations.

Information security

MCHC has formulated an Information Security Policy in order to protect its information systems and assets from internal and external threats, with the aim of maintaining and improving corporate value. We have established the Information Security Committee according to this policy and charged it with reinforcing the management of information security at our business sites inside and outside Japan. We periodically conduct educational and training sessions for all employees including those overseas on our policy to ensure employee awareness and compliance with the Policy. For example, based on the “Cyber Security Management Guidelines” formulated by the Ministry of Economy, Trade and Industry (METI), we are striving to collect the latest information and establish an emergency response system, in cooperation with outside institutions, so as to prevent problem occurrence as much as possible and keep damage to minimum if anything should occur.

Natural disasters

Learning lessons from the Great East Japan Earthquake in 2011, which damaged a number of our business sites and facilities, MCHC has made improvements to its business continuity plan(BCP). In the event that it is impossible to continue operations at the head office of MCHC (Tokyo), we have made plans to transfer head office functions to a temporary backup site with the aim of minimizing damage and ensuring business continuity in a disaster situation. We are examining ways to maintain the procurement of raw materials and the responsibilities for supply of products by procuring from several suppliers as a part of business continuity plan.

Overseas business development risks

Becoming more active overseas business, we are taking various initiatives to reduce risks related to the particular laws, regulations and systems of the country in which we do business. For example, in the business domain of polyolefin used for food packaging materials, if the raw materials did not conform with the regulations of an export destination country, significant risks of not being able to sell or losing trust of customers could occur. In order to prevent such a case from occurring, we have adopted rules on confirmation procedures and have made them known in all companies and we thoroughly put them into practice.
In order to prevent lapses in awareness of any serious risks including such cases, we have created a Global Risk Map as a collection of publicly available case studies of significant problems and legal violations that have occurred in each country. We distribute this map to overseas Group companies overseas, and in fiscal 2016, delivered it to 22 countries, five more than the previous fiscal year. We aim to enhance these activities. In addition, we have established a communication system for local companies, the head offices of operating companies, and MCHC to use in the event of disruption in the country, such as political turmoil.

Response to emerging risks

The MCHC Group is seeking to address the risks below as well, which are expected to expand in the future, by drawing up medium- to long-term strategies.

Climate change

While the chemical industry is a sector generating a large amount of GHG emissions, it is also an industrial segment that can contribute to reducing GHG emission volume through its products. In case the industry cannot meet requests for GHG reduction from customers such as lighting equipment and automobile manufacturers giving priority to compliance with environmental standards for their products and energy-saving effects, it will run the risk of its earnings being adversely affected in the future. Therefore, the MCHC Group is pushing ahead with the development of products that will help battle climate change by setting a qunatitative target calling for “the supply of products and services contributing to reductions in GHG emissions” under its current Mid-term management plan APTSIS 20.

Digital technologies

There is a possibility of digital technologies such as AI and IoT bringing about significant changes to the chemical industry. Failure to cope with such changes in an adequate manner runs the risk of reducing the MCHC Group’s competitiveness. Consequently, the Group established the “Emerging Technology & Business Development Office” in April 2017, with a Chief Innovation Officer (CIO) appointed to serve as general manager and a Chief Digital Officer (CDO) in charge of AI and IoT projects. The Office will employ AI and IoT technologies to promote the automation of process control, product quality inspections and analyses, the development of new materials and pharmaceuticals, etc., all with the aim of attaining and maintaining competitiveness.