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Management Message

Aiming for seamlessreliability andsteadfast service

Haruhiko Kato
President & CEO

Annual Report 201511

Management Message

As a Central Securities Depository (CSD), JASDEC provides vital
infrastructure for financial and capital markets. We have earned theconfidence of users by administering and providing reliable systems andservices, and by working to improve our business processes and capabilities
with the aim of providing world-class functions based on international bestpractice for securities settlement systems.

Recent Initiatives

will continue to improve management transparency andachieve further improvement in our operating efficiency.

In April 2012, the BIS Committee on Payment andImproving Risk Management Structures

Settlement Systems (CPSS)1 and the International
Organization of Securities Commissions (IOSCO)
announced the Principles for financial market

A review of our administrative organization in June

infrastructures (PFMI). In December 2013, Japan’s

2014 resulted in the integration of risk management

Financial Services Agency published Comprehensive

activities within the JASDEC Group. We took steps toGuidelines for Supervision of Financial Market

strengthen our risk management organization, includingInfrastructures. We have responded to these and otherthe appointment of a Chief Risk Officer (CRO) to provide

developments by further strengthening our businessthe necessary guidance and supervision, and theinfrastructure, including our organizational structures,

establishment of the Integrated Risk Management Council,

financial management, and human resources. We have

which is responsible for deliberations and decision-making

also taken steps to ensure the consistent application of ouron key aspects of risk management within the JASDEC

operational risk and system risk management structures,Group. The Integrated Risk Management Council also

and to reinforce our business continuity plan.

regularly monitors the risk management situation within
the JASDEC Group and reports to the Board of Directors.

Strengthening Corporate GovernanceWe also established the Risk Management Department topromote and coordinate risk management activities within

We are determined to maintain a corporate governancethe JASDEC Group.

structure that measures up to Japanese and international
standards of excellence. In July 2015, we therefore shiftedto the corporate structure of a company with a nominating

Strengthening IT System Infrastructure andBusiness Continuity Structurecommittee, etc., which provides a clear demarcation
between management supervision functions and executive

We have formulated a medium-term IT plan thatfunctions as required under the Companies Act. We

encompasses our basic policy on IT. One of our action1

 he Committee on Payment and Settlement Systems (CPSS) wasT
renamed as the Committee on Payment and Market Infrastructures (CPMI)
on 1 September, 2014.

Annual Report 2015

12Management Message

plans for priority goals identified in the medium-termplay a vital role in our efforts to deal with a wide range

plan calls for a review of selection criteria for outsideof challenges resulting from the globalization of financial

service providers and the reinforcement of systemand capital markets and a global trend toward regulation.

development processes. We took steps to strengthen ourJASDEC is involved in planning and administration activities

system infrastructure, by conducting a study concerning

for the Asia-Pacific Central Securities Depository Groupscheduling of these plans.

(ACG) as an Executive Committee member and convener

We also reviewed our guidelines and proceduresof the Exchange of Information task force. We alsofor resuming business operations after a system

participated in discussions at the World Forum of CSDs

breakdown. Based on the results of this review, we further(WFC) concerning issues affecting CSDs, including thestrengthened our business continuity structures throughglobal trend toward tighter regulation of financial markets

measures that include the publication of contingency plans.

and adaptation to the PFMI. In addition, JASDEC served
as a co-chair of Sub-Forum 2 of the ASEAN+3 Bond

International Activities

Market Forum (ABMF) which have been established underthe Asian Bond Markets Initiative (ABMI), which looked

We continued to work proactively in the current fiscal year

at the harmonization and standardization of transaction

to share information and strengthen relationships withprocedures in different countries. Our contributions to thisoverseas CSDs and other organizations. These activities

work included the compilation of a report.

Future Priorities
Under our Basic Management Policy and Medium-Term Business Plan (FY2015–2017), we have identified thefollowing priorities for FY2015.

Ensuring Reliable and Efficient Operations
and Improving Safety and Efficiency AcrossAll Systems

Security and Tax Number (“My Number”) system, theintroduction of integrated taxation on financial incomeand gains, as well as amendments to the Companies
Act and the Act on Book-Entry of Corporate Bonds,

While ensuring the reliable operation of our existing

Shares, etc., in preparation for the smooth implementation

systems and services, we will undertake improvements,of the necessary changes. We will also undertake

reviews and other actions as required to keep paceappropriate studies and efficiently implement anywith recent trends and developments. We will alsomeasures necessitated by system changes affecting

carry out studies as required concerning regulatory andrelated infrastructure, such as the Bank of Japan, financial

tax system changes, such as the launch of the Social

instruments exchanges and CCPs.

Annual Report 2015

13Management Message

Further Reinforcement of
Business Infrastructure

Contributing to the Development ofFinancial and Capital Markets in Japan andInternational Activities

We will continue to strengthen our organizational
structures and financial management in response to new

We will support the development and vitalization of financial

requirements, such as supplemental guidance and reports

and capital markets by working in collaboration with otherof PFMI on specific matters. We will also give priority to theinstitutions and supervisory agencies to contribute totraining of our personnel.

initiatives, such as the reduction of the securities settlement

Our efforts to strengthen our system infrastructure will

cycle, based on the government’s growth strategy

focus both on the improvement of our capacity to maintainas contained in the June 2014 revision of the “Japan

reliable operations and management structures based

Revitalization Strategy,” and on initiatives formulated in Julyon our existing system, and also on studies relating to2012 by a study group established to examine approaches

efficiency improvements and other enhancements to be

to bond market revitalization.
We will also continue to work proactively at theimplemented in our next system.

international level, including research on overseas

We recognize the high public importance of thesecurities settlement infrastructure provided by JASDEC,

settlement schemes, information sharing with overseas

and we will further strengthen our business continuity plan

CSDs, and participation in the ABMI.

(BCP) to ensure that our services can be maintained, if

JASDEC is determined to administer its various

possible, or restored as quickly as possible, in the event ofservices reliably, while responding to environmental anda disaster, system breakdown or other contingency.

structural change and user needs. We are also committed
to the continual review and improvement of our businesspractices, with the aim of maintaining operations andproviding services at the lowest possible cost. We lookforward to the continuing support and cooperation of ourstakeholders.

Haruhiko Kato, President & CEO

Annual Report 2015