The Daiichi Sankyo Group identifies risks as those factors that may prevent the Group from attaining its organizational goals and targets and that can be predicted in advance. The Group is promoting risk management through such means as taking steps to address risks inherent in corporate activities through retaining, reducing, avoiding, or transferring these risks. In addition, we seek to minimize the adverse impacts of risks on people, society and the Group should risks actualize.
Risk Management System
The chief financial officer (CFO) oversees Groupwide risk management as the risk management officer (RMO) and operates the risk management system in conjunction with an annual cycle for formulating and implementing business plans. In addition, the heads of each division autonomously manage risks to aid in the accomplishment of their divisions’ goals and targets. To this end, they analyze and evaluate individual risks, formulate and implement yearly risk management plans, and provide employees with information on underlying risks in the organization, education and insight concerning risk management.
Annual Cycle for Management of Material Risks
Based on assessment of impact and the likelihood of occurrence, risks with the potential to significantly impact the management of the Company are identified by the Management Executive Meeting and the Board of Directors Meeting (see the conceptual diagram below on the Group’s risk level classification). Individuals who have been assigned responsibility for each risk formulate risk response measures (Plan), which are then enacted through coordination with relevant organizations (Do). The progress of risk response measures is monitored twice a year (Check). The risk response measures are corrected or improved upon as necessary (Action). Should precursors of the potential appearance of a material risk be detected, related information will quickly be assembled for provision to the RMO, and appropriate measures will be taken.
As part of the risk management scheme, the Group has a business continuity plan (BCP) that stipulates preparations for and measures to be instituted in the event of a disaster as well as for provisions for crisis management.
The DAIICHI SANKYO Group defines "Crisis" as a collective term for events among the potential risks in our corporate activities that have arisen and that require urgent action and also events with a high likelihood of occurring. The Group has formulated a Global Crisis Management Policy that defines basic matters related to Crisis Management with the aim of minimizing losses caused by such events.
As stated in our basic policy, we are committed to "Upon the occurrence of a crisis, the Daiichi Sankyo Group shall respond immediately and precisely based on the following principles: ensuring the safety of the lives and communities of Daiichi Sankyo Group employees and related personnel; and fulfilling the responsibilities as members of a life science company. The Group shall endeavor to minimize human, social, or corporate losses and strive for business continuity and quick recovery."
In addition to promoting autonomous Crisis Management in each region and function as well as at group companies, we have established a system that enables us to respond flexibly and globally according to the type of Crisis (Disasters, Accidents, Incidents ＜including Terrorism＞, Scandals, Violations of laws, Information management issues, Product issues) and the degree of impact of the Crisis.
Reporting criteria and reporting routes shall be specified, a Crisis Management Officer shall be established (who is designated by the CEO or CEO), as shall an Initial Crisis Management Officer (the VP of General Affairs and Procurement). In the case of a Crisis with a major global impact and the need for company-wide responses, the Group will share such information with the Risk Management Officer (CFO) and endeavor to prevent the escalation of the situation and quickly resolve it through immediately and appropriate initial responses.
After a Crisis convergence, we will analyze the situation ex post facto to prevent recurrences and improve our response.
Business Continuity Plan (BCP)
The Group has a BCP to prepare for four major threats to business continuity: natural disasters, facility accidents, H5N1 influenza and other infectious diseases, and system failures. Based on this plan, systems are in place to quickly restore operations in the event of an emergency and to ensure a steady supply of pharmaceutical products with assured quality to help support the continued provision of medical services.
Based on its experiences following the Great East Japan Earthquake, the Group revised its BCP in 2012. Since then, we have continued to improve upon the BCP through such means as incorporating revisions to national disaster response plans and adjusting for changes in workflow procedures and organizations related to drugs for which supply should be prioritized based on social needs. In this manner, we strive to ensure effective response measures are taken in the event that a risk appears. In addition, we regularly revise the list of priority supply drugs to guarantee we can quickly supply drugs used by a large number of patients, drugs needed in emergencies, and drugs with no substitutes.
To ensure the steady supply of its pharmaceutical products, the Company is taking steps to create backup supply systems by dispersing manufacturing and distribution sites and maintaining relationships with multiple suppliers for important raw materials. In addition, we have introduced private electricity generators to help minimize the impact of any interruption in the supply of electricity. Furthermore, we are strengthening IT infrastructure including the redundancy of key systems.