Risk Management

At SBG, the Risk Management Office spearheads Group-wide risk management activities cooperating with Group companies and departments. The office is supervised by the Chief Risk Officer (CRO), who is appointed by the Board of Directors with responsibility for Group-wide risk management.

SBG established the Risk Management Policy to ensure a Group-wide understanding of the purpose of risk management and to clarify the basic roles of officers, employees, and risk managers. This policy applies to all officers and employees and the Group companies to encourage their active involvement in risk management activities. Under this policy, and in accordance with SBG’s Risk Management Regulations and the Group Company Management Regulations, we appoint risk managers at SBG and its Group companies, comprehensively identify financial and non-financial risks that might arise during business activities, and monitor the countermeasures and their implementation status on at least a quarterly basis.

The Risk Management Office ensures the effectiveness of Group-wide risk management by receiving reports on material matters from risk managers and confirming compliance with the regulations. These policies and regulations are periodically reviewed and approved by the Board of Directors of SBG and other bodies. The Risk Management Office quarterly reports identified risks that are material to the Group and their countermeasures to the Board of Directors and the Group Risk and Compliance Committee (GRCC). Accordingly, both governance bodies oversee the Risk Management Office. The GRCC consists of SBG's Board Directors and Corporate Officers and other members and provides oversight of the risk management and ethics and compliance programs of the Company.

The Risk Management Office works to strengthen risk management activities by comprehensively gathering information and identifying and addressing risks, with the aim of eliminating and reducing impediments that could adversely affect the sustainable growth of the Group as a whole.

To identify risks that require priority attention across the Group, the Risk Management Office comprehensively gathers a wide range of information related to financial and non-financial risks. To this end, it mainly undertakes the following initiatives.

At SBG, when important decisions, including new investments, are made by the Board of Directors, the Investment Committee, or other relevant bodies, the Risk Management Office reviews the proposals in advance, consults with relevant departments as necessary, and confirms that the proposals appropriately reflect risk information relevant to the decision-making process.

The Risk Management Office visualizes the overall picture of the Group’s investment portfolio and conducts both quantitative and qualitative risk analyses from various perspectives. For example, it monitors the impact of changes in the external environment, including economic and monetary policies and political developments, on SBG’s financial indicators, as well as the degree of investment concentration in specific countries, regions, industries, and other areas.

The Risk Management Office comprehensively gathers various types of risk-related information identified by major Group companies and departments across SBG, and promptly receives reports when risks materialize.

Based on the insights gained through these initiatives, the Risk Management Office analyzes and assesses risks and corresponding countermeasures, taking into consideration factors such as the likelihood of occurrence and the magnitude of the potential impact of each risk. Through this process, it identifies material risks that could significantly affect the Group’s sustainable growth. For the material risks identified, the Risk Management Office collaborates with relevant departments and Group companies to track the status of countermeasures and monitor their effectiveness.

Through these initiatives, material risks and the status of countermeasures are reported to the Board of Directors and the GRCC on a quarterly basis. Based on the outcomes of discussions at these meetings, the Risk Management Office works to strengthen risk management. In addition, as part of its educational efforts, it provides individual briefings and opportunities for dialogue on the latest risk trends and related information to help external directors and others make decisions based on an appropriate understanding of risks across the Group. The Risk Management Office also seeks to further enhance risk management by reflecting insights gained through these discussions in future initiatives.

In fiscal 2025, SBG made numerous investments in AI-related businesses, most notably a follow-on investment of $30 billion in OpenAI. In fiscal 2026, SBG plans to continue making AI-related investments, with another $30 billion follow-on investment in OpenAI among its planned investments. We view AI as an investment area with a high degree of uncertainty, given the rapid pace of technological innovation and significant changes in the competitive landscape and regulations. In light of these characteristics, we analyze and monitor risks, with a particular focus on SBG’s financing risks and risks arising from changes in the market environment. We also conduct stress tests in collaboration with the Finance Unit and continuously confirm the levels of LTV and the cash position.

With respect to financing, we consider multiple scenarios and examine the potential impact if financing does not proceed as planned, as well as alternative financing measures. We then report to the Board of Directors the risks that should be considered. In addition, we continuously monitor trends in the AI market and developments among major companies in collaboration with relevant teams in Japan and overseas.

Furthermore, with respect to SoftBank Vision Funds, we work closely with the relevant teams and receive updates on the latest business conditions and operational progress of major portfolio companies, including OpenAI. We conduct regular monitoring not only before investments are made but also after execution, and strive to maintain a timely understanding of developments even in a rapidly and significantly changing environment.

As SBG advanced multiple large-scale investments, we have emphasized risk management from the perspective of the overall balance of the portfolio, rather than focusing solely on the risks of individual investments. Given the rapid pace of change and high level of uncertainty in the AI sector, we believe it is important to consider not only the impact of each individual investment, but also how these investments may affect SBG as a whole.

To reflect this perspective, we review proposals related to important decisions, including not only new investments but also financing, before they are submitted to the Board of Directors or the Investment Committee. In this process, we consult with relevant departments as necessary and carefully examine whether the proposals appropriately reflect the risks relevant to the decision-making process. Even after proposals are approved, we continue to monitor developments in collaboration with relevant departments, while reviewing, as appropriate, the progress of individual investments and the developments in the overall portfolio, as well as the status of related financing.

Through these initiatives, we aim to further strengthen collaboration within SBG and across the Group, and build a risk management framework that can adapt to changes in the business environment.