Risk Management
Policy and Concept
In order to sustain our business activities in the face of significant changes in the external environment, including a decline in the total domestic population and working-age population, and an increase in geopolitical and natural disaster risks, the Tokyo Tatemono Group has identified strengthening our risk management framework as one of our material issues. The Tokyo Tatemono Group seeks to appropriately manage risks that could affect the Group's business to achieve stable improvement in corporate value. With this in mind, we have established related regulations, created a risk management framework, and are carrying out ongoing risk monitoring and control.
Structure
To centrally manage risk throughout the Group, Tokyo Tatemono established its Risk Management Committee chaired by the President. The Risk Management Committee formulates annual plans for the risk management of the Tokyo Tatemono Group, evaluates and analyzes risks that are important to management (priority risks), formulates preventive measures and countermeasures, and periodically monitors the status of countermeasures, among other activities. In addition, we have established a unified risk management structure in which risks other than priority risks (department-managed risks) are managed by the general managers of each department as Risk Management Officers, while the President, as Chief Risk Management Officer, centrally oversees company-wide risk.
Furthermore, by adopting the principles of the Three Lines Model*, we aim to maintain and enhance the effectiveness of our risk management efforts.
For department-managed risks, in addition to the general managers of each department who are risk management officers, various committees and Group companies act as risk response organizations (risk owners) (the First Line) to appropriately prevent and manage the risks, reporting to the Risk Management Committee. The corporate departments and the planning departments of each business division (the Second Line) conduct monitoring, guidance, and support regarding risk management at each department, among other activities. The Internal Audit Department (the Third Line) conducts audits, verifications, and provides advice, from an independent standpoint, regarding risk management by each department and Group company, as well as regarding the monitoring, guidance, and support provided by the corporate and planning departments of each business division regarding risk management at each department and Group company. Also, the Risk Management Committee operates independently of the Audit and Supervisory Board and the Chief Risk Management Officer (Tokyo Tatemono's President) is not a member of the Audit and Supervisory Board.
The Sustainability Committee acts as the risk response organization (risk owner) to manage sustainability risks in cooperation with relevant departments, and reports key matters in its activities to the Risk Management Committee.
Important matters deliberated by the Risk Management Committee, such as the risk management structure, policies, and annual plans, are submitted to or reported to the Board of Directors. The Board supervises the effectiveness of the Group's overall risk management, including sustainability-related risks.
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*The Group's risk management structure was developed with reference to the following external standards and frameworks.
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・ISO 31000: An international standard for risk management
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・Enterprise Risk Management (ERM): An enterprise-wide risk management framework released by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
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・Three Lines Model: Released by the Institute of Internal Auditors (IIA)
Risk Management Structure
