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Risk Management

The NTT Group faces a rapidly changing business environment, including intensified competition in the information and telecommunications sector. In this context, NTT Group companies are exposed to an increasing amount of business risk.

The NTT Group strives to minimize the impact of losses that could result from the materialization of risk by anticipating and preventing the occurrence of potential risks.

As part of these efforts, NTT has formulated the NTT Group Business Risk Management Manual and has distributed it to all Group companies so that the entire Group can work together to conduct risk management.

In addition, each Group company has formulated its own manuals and other guidelines, which reflect its specific business operations, business environment, and other factors, and is using these materials to control business risks.

Risk Management System

At NTT, Risk Management Regulations are in place, which define fundamental policies concerning risk management for effective and efficient business operations, and a PDCA cycle has been conducted on a continuous basis under the leadership of the Business Risk Management Committee, chaired by the representative director and senior executive vice president.

Risk Management System

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Identifying Material Risks

From time to time, NTT reviews assumed risks and management policies based on changes in the social environment. The Business Risk Management Committee leads implementation of periodic risk analysis processes for each organization.

A report is submitted to the Board of Directors, which reviews the results as well as the overall risk factors of each organization, prioritizes the material risks, and decides on responses.

Identifying Material Risks

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Response to Individual Risks

Information Security Risk

If there is a leak or other misuse of confidential information such as personal information, the action may affect the NTT Group’s business, including its credibility and reputation, and its ability to obtain new subscribers or secure governmental contracts may be adversely impacted.

To prevent such a situation, the NTT Group is making efforts to protect confidential information obtained in the course of its business, including the personal information of customers. In addition, the NTT Group has formulated the NTT Group Information Security Policy, which outlines our stance on ensuring information security, and is taking rigorous steps on a Group-wide basis, including enhanced internal information management, training and awareness-raising for officers and employees, and publication of manuals, to protect the personal information of our customers and prevent any leakage.

Risks Related to Disasters

Five Group companies—NTT, NTT East, NTT West, NTT Communications, and NTT DOCOMO—have been designated public institutions under the Basic Act on Disaster Control Measures.

Accordingly, in preparation for a disaster, the NTT Group has formulated the Disaster Management Operation Plan for the purpose of smooth, appropriate implementation of measures to prevent damage. Damage prevention measures require an ongoing process of periodic review to reflect the latest knowledge and legal revisions.

In June 2014, the Japanese government revised the Nankai Trough Earthquake Countermeasures Basic Plan. In response, the NTT Group has revised the Disaster Management Operation Plan and is strengthening damage prevention measures.

Pandemic Risk

The global spread of novel influenza and other diseases has had a major influence on economies and lifestyles. In this setting, countermeasures have become a social issue.

In accordance with the Act on Special Measures for Countermeasures against Novel Influenza that was promulgated in 2012, five companies in the NTT Group (same as above) are designated public institutions.

In response, in March 2014 the NTT Group formulated the Novel Influenza Countermeasures Plan. In accordance with the stages of an outbreak of novel influenza or other diseases, we have created a specific plan for the fulfillment of our responsibilities as designated public institutions and for the prevention of infection from the viewpoint of respect for human life.

We also take action to prepare against novel influenza and other diseases by conducting response training in correlation with national training organized by the government.

Risks Arising from Climate Change

Responsible for environmental enhancement activities across the whole Group, the Environmental Protection Office is assigned to identify environmental risks that could affect our businesses not only environmentally but also financially.

As for the risks and opportunities with respect to facilities and equipment, monitoring and assessment are conducted through a collaborative effort between staff in charge of environmental issues and those responsible for facilities, and these individuals are appointed for every Group company. We consider future climate change a particularly imperative issue and are therefore working toward the environmental targets that have been set for the years leading up to 2030.

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