Governance
Global Enterprise Risk Management

The world has seen, and will continue to see, volatility relating to disruptive innovations in technology, cyber-attacks, geopolitical disputes and macroeconomic risks, sustainability and ESG, and catastrophic events (such as resource scarcity, natural disasters, humanitarian crises, as well as outbreaks, epidemics, and pandemics). While change is constant, the challenges of recent and future years require global companies, such as the Bridgestone Group, to build and sustain resilience of its operations. The Bridgestone Group’s 2030 Long Term Strategic Aspiration recognizes these challenges and focuses our efforts on becoming a resilient ”excellent” Bridgestone.

To that end, the Bridgestone Group is committed to enhancing its global and regional programs to manage risks, including the Bridgestone Group’s ability to identify, assess, mitigate, and respond to significant enterprise-wide risks. As part of our ongoing efforts to manage global risks and ensure we deliver on the Bridgestone’s Mission of “Serving Society with Superior Quality,” the Bridgestone Group continues to strengthen the global enterprise risk management program through advanced enterprise-wide technology, ongoing risk assessments, proactive sensing, and scenario planning with mitigation strategies that will enable us to remain resilient and, on some occasions, transform volatility into opportunity.

Our enterprise risk management program is built on a framework that strives for alignment between our global and regional risk management programs and the different risks faced by the organization around the world.

In early 2022, the Bridgestone Group established the Global Management Risk Committee (the “GMRC”). The GMRC, chaired by the Group Global General Counsel and Global ERM Leader, is a chartered committee consisting of the CEOs, global executives, and risk leaders of each region, as well as others with relevant expertise within the organization. The GMRC meets several times a year (including through a regular cadence of meetings and on an ad hoc basis as needed) and has direct oversight of the most significant enterprise-wide global risks and the overall global ERM program. The GMRC evaluates various global risks from short-, medium-, and long-term perspectives, and provides oversight and guidance for the relevant leaders and cross-functional groups within the organization who are charged with leading the risk management efforts. The GMRC additionally reviews relevant industry best practices and provides guidance and support for the Global ERM Department to facilitate and integrate risk management training across the organization. Members of the GMRC also periodically provide updates and reports to the Global CEO and board members. These periodic updates provide regular opportunities for senior leadership to engage with the global program, provide direction and to help ensure risk management is part of the Bridgestone Group’s strategic planning and decision making.

In addition to the GMRC, the Bridgestone Group also maintains a Global ERM Department. The Global ERM Department consists of risk leaders and dedicated enterprise risk management professionals globally and from each region. The Global ERM Department meets frequently and has direct responsibility for the design and implementation of enterprise risk management at the global and regional levels, including investment in and use of leading risk management technology and systems, and continuously enhancing our business continuity and crisis management activities. The Global ERM Department helps ensure alignment on global risk-related activities together with risk-related activities for each strategic business unit and region. The efforts of the Global ERM Department will help build and sustain a culture of resilience (including, for example, by periodically conducting risk identification exercises and reporting on risk management activities), proactively conducting risk sensing and scenario planning, and embedding enterprise risk management in strategic planning and decision making throughout the organization. The Global ERM Department, under the direction of the Global ERM Leader, reports to the GMRC and closely collaborates with a number of the Bridgestone Group’s global committees, including the Global Sustainability Committee, to ensure that areas such as sustainability is integrated into ERM processes (including, for example, that materiality assessments relating to our sustainability program are helping inform our global and regional risk management programs). Each of the regional risk leaders are also responsible for driving and coordinating operational risk mitigation and management activities at the department and SBU levels in their respective regions. Finally, each of our SBU board of directors has relevant committees which provide additional oversight over Bridgestone’s risk management efforts.

In addition to the internal resources who are focused on global risk management, the Bridgestone Group also periodically engages different external experts and other third parties to help support the global and regional risk management programs. These third parties periodically provide support for risk-related activities (such as risk identification and validation exercises), advising on particular risk topics (such as geopolitical disputes) and other program enhancements.

The Global Enterprise Risk Management program seeks to evaluate and capitalize on the best industry-leading frameworks, including the framework provided by the Committee of Sponsoring Organizations & Treadway Commission (COSO), the International Organization for Standardization (ISO 31000), the Risk Management Society (RIMS) and other industry-leading thought leaders. The Group’s Global Enterprise Risk Management program is developed based on elements of these industry-leading frameworks and thought leadership. The framework of the organization is reviewed and updated as needed to respond to the changing business landscape.

The Bridgestone Group conducts regular risk assessments to identify, assess, validate, and develop appropriate response strategies for our most significant risks and to ensure that our strategic planning is aligned with addressing these risks. Some of the mitigation and management approaches to some of our global risks are reflected in the Bridgestone 3.0 Journey 2024 Integrated Report as part of strategic, operational, and financial planning.
For risk management, particularly focused on the Regional Enterprise Risk Management programs, please refer to the Business Continuity (BCP), Risk Management.

The assessment process includes identifying a theme and category for each identified risk and evaluates the risk based on likelihood and impact scales. This assessment takes into consideration quantitative (e.g., financial, operational, strategic) as well as qualitative (e.g., reputational) analysis. Additionally, management preparedness and existing controls in place to manage the identified risk are reviewed. Some of our global risks include the following.