Enterprise Risk Management System
Tokyo Gas has set up an enterprise risk management (ERM) system and identified major risks in its Risk Management Regulations.
The Risk Management Committee, established to advance our ERM, periodically checks on progress regarding the establishment and operational status of the ERM system, reports results to the Corporate Executive Committee and obtains the necessary approvals. Under this framework, around 150 risk management promotion officers are deployed in the business departments of Tokyo Gas and its subsidiaries to promote ERM. Each year, we assess risks and the implementation and improvement status of countermeasures. This system facilitates the steady implementation of the ERM-PDCA cycle.
■Enterprise Risk Management System
(1) Gas resource procurement difficulties
(2) Natural disasters
(3) Accidents accompanying gas manufacture and supply, and supply impairments
(4) Unforeseen, large-scale power outages
(5) Problems in securing the safety of city gas and quality of gas appliances
(6) Damage due to rumors caused by city gas accidents at other firms
(1) Risk of changes in market prices and interest rates3. Risks accompanying business execution
(1) Risks related to existing businesses
① Decrease in demand due to intensified competition
② Changes in gas resource costs
③ Changes in laws, regulations, institutions, and national or local energy policies
④ Changes in gas sales due to climate change
⑤ Reduction in demand due to changes in the business environment
⑥ Interruption of telephone service at call centers
⑦ Delay in the development of new technologies
(2) Risks associated with the development of overseas businesses
(3) Delayed cultivation of new markets
(4) Inability to recover investments
(1) Leakage of personal information
(2) Shutdown or malfunction of IT systems
(1) Compliance violations
(2) Conformance with new environmental regulations etc.
(3) Insufficient CS or customer service
(4) Insufficient response to human rights issues
Crisis Management System
Since the Company provides public services that are essential lifelines, it has for many years also operated a crisis management system that serves as a response system in the event of an accident or other risk-related incidents. Specifically, we formulated the Emergency Response Regulations, with which the Emergency Response Organization will respond accordingly and immediately in the event of a crisis, including major natural disasters such as an earthquake, production or supply disruptions arising from major accidents at LNG terminals or gas pipelines, influenza outbreaks, terrorism, failures in mission-critical IT systems, and compliance problems.
The Company periodically conducts training on major risk response measures. We have also formulated a business continuity plan, which outlines how the Company will respond in the event of a major earthquake of the magnitude assumed by Japan’s Cabinet Office, major accident disrupting gas supply, widespread power blackout, influenza outbreak, or large-scale mission-critical IT system stoppage. This plan is in place to reinforce our risk management system.
■Emergency Response Organization
Provision of Risk Management TrainingThe Tokyo Gas Group provides training programs to promote risk management.
Escalation RulesTo further enhance a corporate and organizational culture that encourages appropriate responses to managing risks, we established our clearly defined Escalation Rules, which require that information on any apparent major risk, such as accidents and disasters, be reported to the appropriate supervisory staff in a timely and appropriate manner.