Risk Management / Risk Management System
The risk management system of Pigeon is headed by the Global Head Office (GHO) Risk Management Committee. Governed by the Rules for Risk Management, which systematically stipulate the Group’s risk-management responses, the GHO Risk Management Committee is chaired by the director for GHO, under the supervision of the president and CEO. Directly below the GHO Risk Management Committee are the Risk Management Committees of each business segment, which are chaired by the head of operations in each segment. This framework enables information about risk to be collected across our entiregroup, provides necessary controls and empowers each segment to respond rapidly to risk issues.
At least once a year, the GHO Risk Management Committee reports to the Board of Directors regarding the Group’s risk-management activities during normal times and when incidents occur, as described below.
[At Normal Times]
The GHO Risk Management Committee systematically collects, analyzes and evaluates the risk information it gathers from throughout the group, centered on the risk information it collects from each business segment (Japan Business, China Business, Singapore Business and Lansinoh Business). On its own or through the respective business segments, the GHO Risk Management Committee then examines and implements response measures.
The Risk Management Committees of each business segment collect, analyze and evaluate risk information from their respective business segments and the Group companies under them. These Committees then examine and implement response measures.
We classify risk into four categories: Business risk, financial risk, hazard risk and compliance risk. The Group collects, analyzes and evaluates this risk information and examines and implements response measures.
[When Incidents Occur]
In the event that the Group is confronted with a crisis, such as a disaster or other major incident, the Risk Management Committee (here and hereinafter, “Risk Management Committee” refers to either the GHO Risk Management Committee or the Risk Management Committee of the appropriate segment) convenes and takes steps to minimize damage and effect recovery, based on the Rules for Risk Management and the Business Continuity Plan (BCP).
Information on consultations and reporting through the internal whistle-blowing system are also collected and sent to the GHO Risk Management Committee. The Risk Management Committee or a department nominated by the Risk Management Committee responds as necessary based on the details of the consultations and reporting.
Risk Management Organization Chart
Corporate Ethics Guidelines
The “Pigeon Way” is the cornerstone of all activities. It embodies our “heart and soul” and sets the grounds for our actions to stream from this core. On this basis, we have established a basic policy on compliance called the “Corporate Ethics Guidelines.” The corporate ethics guidelines have two components: corporate ethics policies, which comprise the ethical sensibility we must hold to continue to earn the trust and support of society, and a code of conduct, which comprises guidelines that spell out how each employee embodies the corporate ethics policies in business activities. The corporate ethics policies declare that every Pigeon Group employee must comply strictly with laws, regulations and social norms, in both letter and spirit, acting in good faith and with a high sense of ethics. The corporate ethics guidelines enable us to earn the trust and support of stakeholders. As the corporate ethics guidelines indicate, we believe it is vital to convey to all Group employees Pigeon’s business philosophy and the sense of values of its management. Our representative directors president and all other executives lead by example in rigorously promoting our spirit of ethics and compliance.
The Pigeon Group's compliance policy is based on the Pigeon Way, our corporate ethics guidelines (corporate ethics policies and code of conduct), and we have established compliance policies in three areas where considered particularly high-risk: “Anti-bribery and Corruption”, “Antitrust Compliance” and “Information Management”.
These policies are designed to promote understanding and action by Pigeon Group employees and to promote compliance by outlining specific actions to be taken and the necessary systems and frameworks in those areas.
- The anti-bribery and corruption policy includes detailed rules for “Gifts and Hospitality”, “Charitable and Political Donations” and “Agents and Intermediaries”, to ensure through prevention of bribery and corruption.
- The antitrust compliance policy includes detailed rules and guidelines including “Checklist for Assessing Antitrust Violation Risk” and “Trade Association Activity and Meeting Attendance – Antitrust Rules” to ensure compliance with competition laws.
- The information management guidelines include detailed rules for “Management of Personal Information” and “Management of Confidential Information” to ensure all of the defined information is managed and protected.
Compliance Education and Monitoring
With the Legal Department playing a pivotal role, we ensure that all Group employees are knowledgeable about compliance. We carry out e-learning on the topic and provide corporate-ethics training sessions to thoroughly inform Group companies both in Japan and overseas about the corporate ethics guidelines. To ensure understanding of compliance issues that can arise in the course of everyday business, as well as approaches to compliance and methods of responding, the Group circulates a “Pigeon Compliance Communication” newsletter to all employees once a month. Topics covered in the newsletter include laws related to Pigeon’s operations, such as the Antitrust Act and the Act against Unjustifiable Premiums and Misleading Representations and an overview of harassment and other compliance issues.
In the 2021 compliance training, all Group employees were informed of the importance of compliance through a video message from the president and CEO. Furthermore, the Pigeon Way, the Corporate Ethics Guidelines (including anti-corruption and compliance with antitrust laws), and the Speak-Up Desk (in-house whistle-blowing system) were explained based on our own materials, in order to instill the compliance that employees should have in their daily work. After the training, a questionnaire was given to the participants, which is utilized to improve the contents.
In addition, approximately once every three years, we conduct "Compliance Monitoring," in which employees of the Group answer questionnaires in order to evaluate and improve their awareness of and understanding of compliance. In the Compliance Monitoring, we check the level of understanding and penetration of compliance (e.g., understanding and sympathy with the Pigeon Way and the Corporate Ethics Guidelines, understanding of the internal whistle-blowing system, etc.), risks (e.g., information management, fraud, harassment, working environment, quality control, intellectual property infringement, etc.), and organizational climate for each company or organization. If any issues are identified, we consider and implement compliance measures to deal with the issues. The contents and results of compliance training and compliance monitoring are reported to the GHO Risk Management Committee, which reports them to the Board of Directors every year. Moreover, when internal audits are conducted, the Audit Office confirms the penetration and implementation of the Pigeon Way in order to understand the status of the organization.
Responses When Compliance Violations are Detected or Perceived
When a real or suspected compliance violation is detected or perceived, the Risk Management Committee gathers information and examines the facts about the matter. The GHO Risk Management Committee then makes arrangements to enable the response necessary to resolve the problem in a timely manner.
Internal Whistle-blowing System
The internal whistle-blowing system consists of two channels for reporting compliance violations. Speak-Up Desks are provided for use within the Pigeon Group. The Pigeon Partners Line is for the use of persons outside of the Group, including business partners.
When problems are discovered within the Group or outside it, the GHO Risk Management Committee considers appropriate responses as necessary and examines the facts, taking every precaution to protect whistleblowers and consultants. In this way the GHO Risk Management Committee makes arrangements to enable the response necessary to resolve the problem in a timely manner. If necessary, the advice of a legal adviser may be sought, to weigh the legal propriety of responses.
Each year, the GHO Risk Management Committee reports to the Board of Directors regarding the matters reported through the in-house whistle-blowing system, the results of the Committee’s responses and related information.
Speak-Up Desk (In-house Whistle-blowing System)
We have established Speak-Up Desk so that any Pigeon Group employee who suspects that a violation of corporate ethics, etc. (compliance violation) may occur or is occurring in the course of business activities can report the issue to a Speak-Up Desk or seek consultation about the issue there. Pigeon personnel are advised about Speak-Up Desk and how to use it through compliance education.
In FY2020 the Speak-Up Desk received 3 reports of compliance violations.
The following three lines are available as contact points.
1) In-house contact point (to the Legal Department)
2) In-house contact point (to the Audit & Supervisory Board members)
3) Outside contact point (to a legal adviser)
[What to Report / Seek Consultation About]
Appropriate subjects to report or seek consultation about include bribery/corruption, fraudulent accounting, payoffs, embezzlement, information leaks and other serious violations of the law, as well as violations of corporate ethics, actions likely to damage the good name of the Pigeon Group, or other actions commensurate with the above.
[Protection of Whistleblowers]
Whistleblowing is handled based on the Pigeon Group in-house regulations, which protect whistleblower confidentiality and prohibit the handling of reporting and consultation in ways disadvantageous to whistleblowers.
Operational Flow of Speak-Up Desk (In-house Whistle-blowing System) after Reporting
The Pigeon Partners Line (Contact point for the use of business partners to report or seek consultation on compliance)
We have established the Pigeon Partners Line so that any business partner or other person who suspects that a Pigeon Group employee, in the course of business activities with the Pigeon Group, may commit or is committing a violation of corporate ethics, etc. (compliance violation), or has caused suspicion even if the act was not a violation, can use it to report or seek consultation about the issue.
Two contact points are available: An in-house contact point (to the Legal Department) and an outside contact point (to a legal adviser). Our in-house regulations protect whistleblower confidentiality and prohibit the handling of reporting and consultation in ways disadvantageous to whistleblowers or their companies (our business partners).
In FY2020 the Pigeon Partners Line received zero reports of compliance violations.
Information Security Measures
In delivering products, services and information to customers, we position information security and protection of personal information as issues of vital importance. The Group has established a framework by which the Risk Management Committee deliberates to consider attendant risks and devise countermeasures for each such issue and implement them through the information security sector, legal sector or other sectors with jurisdiction. In this way we are working to strengthen its management of information security and personal information. In July 2005, Pigeon Corporation's framework for protection of personal information was certified with the Privacy Mark. The Privacy Mark system is operated by the Japan Information Processing Development Corporation (now the Japan Institute for Promotion of Digital Economy and Community (JIPDEC)). The Privacy Mark accorded Pigeon certifies that Pigeon is an operator that handles personal information appropriately in accordance with JIS Q 15001:1999, “Requirements for compliance programs for personal information protection,” now JIS Q 15001: 2017, “Personal information protection management systems.” JIPDEC renewed Pigeon’s certification in 2007, 2009, 2011, 2013, 2015, 2017, 2019 and 2021.
The Privacy Mark