Compliance and Ongoing Strengthening of the Internal Control Framework

「Regarding the strengthening of internal control systems, in addition to strengthening cybersecurity and measures to prevent money laundering, the Bank strengthened the management and oversight framework for 日本郵便株式会社, which is entrusted with the Bank's banking operations, as a measure to prevent recurrence of cross-selling incidents.」

「The Bank further reorganised the Service Improvement Committee, chaired by the Representative Executive Officer, President, and renamed it the “Everyone's Voice Committee -ECHO-.” All officers and employees worked to propose and improve products and services based on customer feedback and improve the workplace based on employee feedback, thereby advancing customer-oriented business conduct and organisational culture reform.」

「To prevent recurrence of internal crimes at directly operated branches and post offices, the Bank further strengthened its compliance framework by promoting initiatives across the 日本郵政 Group, including reviewing crime-prevention rules and monitoring KRIs (Note 3) at post offices. It will also promote customer-oriented business conduct through a framework for using customer and employee feedback to improve services and operations.」

「In preparation for the system renewal scheduled for May 2023, the Bank established a company-wide implementation committee reporting directly to the Representative Executive Officer, President, and built a company-wide framework with advice from a third-party organisation, achieving a smooth system renewal.」

「In addition, the Bank strengthened its risk management framework by establishing and operating, as subordinate bodies of the Risk Management Committee, a New Products and Services Review Subcommittee to strengthen review systems when new products and services are introduced and thereafter, and a System Risk Subcommittee to discuss and share information on system security and system risks among the relevant divisions.」

「For the auxiliary ledgers for financial instrument intermediary services relating to investment trust and Japanese government bond transactions, the Bank implemented electronic recordkeeping as a measure to prevent recurrence. It will also progressively reduce the volume of retained documents and digitise them (move to paperless processes) to prevent the loss of documents other than these auxiliary ledgers.」

「Specifically, the Bank will work to strengthen the autonomous management of the first line (sales and administrative divisions) and reinforce the company-wide checks and balances applied by the second line (control divisions) and third line (audit division) to the first line, thereby strengthening its risk management framework.」

「The Bank established the Customer Service Coordination Department in January 2021 and the Cashless Fraud Consultation Desk in March 2021, among other measures, thereby establishing a system for centrally managing customer complaints and consultations from intake through resolution.」

「〇 We comply with laws and regulations and provide high-quality services that customers can use with confidence.」

「As measures to prevent recurrence, the Bank worked to further embed the intent of its internal rules through training and other measures, improve and enhance sales tools for customers, strengthen its compliance and audit systems, and review sales targets.」

「The Bank has positioned the prevention of money laundering and terrorist financing as an important management priority and is working to establish and strengthen its control systems.」

「The Bank further strengthened its internal control systems through measures including compliance training and the proper sale of asset management products. In addition, it established key performance indicators (KPIs) to regularly review the status of initiatives based on the “Basic Policy on Customer-Oriented Business Conduct” and disclosed the results, among other measures, to provide “high-quality financial services centered on customers.”」

「In June 2017, the Bank published its “Basic Policy on Customer-Oriented Business Conduct” and worked to embed and promote it. In March 2018, it updated and republished the policy to promote its further adoption.」

「Based on the strong conviction that “a company cannot survive without compliance,” the Bank treated enhancement of its internal control systems as an important management priority, including further embedding compliance awareness through various training programmes and strengthening systems for managing customer protection and other matters in the sale of asset management products.」

「The business improvement order was lifted in December 2015 as a result of the measures taken to date. The Bank nevertheless continued to address the further penetration of compliance awareness and enhancement of its internal control systems as important management priorities.」