FUJI OIL CO., LTD.

Key raw materials such as cacao beans, soybeans, and palm oil are subject to international market conditions, and price fluctuations directly affect procurement costs. Rising raw material costs may put pressure on profitability. The Group seeks to mitigate this risk through diversification of procurement sources and efforts to pass on costs through pricing.

As the Company operates businesses in Japan, Europe, the Americas, and Asia, it is exposed to the effects of exchange rate fluctuations in foreign currency-denominated transactions and in the translation of overseas subsidiaries' financial statements. Both yen depreciation and appreciation may affect earnings and asset values, and the Company implements measures such as foreign exchange hedging to address this risk.

There is a risk that tightening regulations related to climate change, as well as natural disasters and harvest volume fluctuations in raw material producing regions, could affect procurement stability and costs. The Company conducts risk management based on ESG materiality, addressing this through the promotion of sustainable procurement and the establishment of greenhouse gas reduction targets.

As a food manufacturer, if issues related to product safety or quality arise, this could result in significant impacts such as loss of trust from consumers and business partners, product recall costs, and legal liability. The Group has established a quality control system across the organization and implements preventive measures through risk assessments.

Cyberattacks or information leaks could disrupt business continuity, result in the leakage of confidential information, and damage the Company's social credibility. The Group identifies risks through the creation of risk maps at each group company and continues to strengthen information security measures.

Changes in food regulations, environmental regulations, labor regulations, and other laws in Japan, Europe, the Americas, and Asian countries may affect business operating costs and market entry conditions. The head office monitors regulatory trends in each region and works to establish a compliance system.

In global operations spanning Europe, the Americas, and Asia, changes in political and economic conditions, local laws and regulations, and cultural differences may affect business operations. The head office conducts risk assessments for group companies in each region and takes the lead in identifying risks and formulating countermeasures.

As the Company expands its business globally, difficulty in recruiting, retaining, and developing talented personnel could hinder business competitiveness and the execution of growth strategies. This is recognized as one of the Company's key company-wide risks, and efforts are underway to strengthen human resource strategy and improve the working environment.

In M&A transactions and capital investments aimed at business expansion, there is a risk that expected synergies may not be realized, or that post-acquisition integration may not proceed as planned, leading to goodwill impairment or increased financial burden. Investment projects are evaluated and monitored through deliberation by the Risk Management Committee.

Natural disasters such as earthquakes and floods, or the spread of infectious diseases, could cause production facility shutdowns or supply chain disruptions, significantly affecting business continuity. The Company is advancing the development of its BCP (Business Continuity Plan) and comprehensively identifies and manages disaster and accident risks as a key company-wide risk.