• Risk Factors

Risk Factors Risk Factors

JDI has established the necessary rules and systems, including the "Risk Management Rules," based on the "Crisis Management of Loss" outlined in the "Basic Policy on the Internal Control System." These measures are designed to prevent risks from occurring and to minimize their impact should they do arise. The Risk Management Rules define operational procedures for risk management, including an annual process to identify and analyze risks and implement appropriate countermeasures, with the goal of ensuring sustainable and stable business operations. The Sustainability Department serves as the principal department overseeing these activities.

In line with the risk management framework, each responsible department evaluates the likelihood (frequency) and potential impact (e.g., on sales and profits) of anticipated risks. For risks deemed highly significant, departments prioritize their assessment and formulate and implement measures to avoid, mitigate, or transfer them. The Sustainability Department conducts hearings and other assessments to confirm the implementation status and evaluate the effectiveness of these measures across departments. The results of the annual risk assessment are reported to the Board of Directors following a management review and are communicated to all employees. In addition, risk analysis and countermeasures are incorporated into the formulation of business plans and medium-term strategies.

The following outlines the major risks that may materially affect JDI’s financial position, operating results, and cash flows. Please note that this list does not cover all potential risks. JDI may also be affected in the future by risks that are currently unforeseen or considered to be of lower significance. Any forward-looking statements contained herein reflect the judgment of JDI as of June 20, 2025.

(1) Strategic Risks

① Market Trends and Competitive Environment

Likelihood of Occurrence: High        Impact Level: Significant

Risk

The display products manufactured and sold by JDI are affected by fluctuations in the markets of the end products in which they are incorporated, as well as by changes in the competitive environment. In particular, significant market volatility caused by factors such as economic trends, shifts in consumer preferences, or seasonality may result in decreased sales revenue, increased costs, inventory write-downs due to excess inventory, and opportunity losses stemming from reduced factory utilization rates. In addition, intensified competition with peer companies could lead to a declining sales and downward pressure on selling prices.

Countermeasures

JDI closely monitors customer demand trends and strives to manage inventory and production appropriately. Under the BEYOND DISPLAY growth strategy, JDI aims to sustain and expand sales, and stabilize or optimize selling prices by transforming its product portfolio.
In the display business, JDI seeks to minimize costs through asset-light initiatives and improve production efficiency, while strengthening operations by outsourcing production to foundry partners.
In the sensor and advanced semiconductor packaging businesses, JDI leverages proprietary technologies developed in the display business and differentiates itself from competitors through collaborations with external companies, thereby securing a competitive advantage.
JDI continues to analyze competitor and assess the external environment to gain a more accurate understanding of its competitive landscape.
 

② Technology and R&D

Likelihood of Occurrence: Low         Impact Level: Significant

Risk

JDI is engaged in the manufacturing and sales of displays that require advanced technologies, and securing technological superiority is critically important for its competitiveness. To maintain and enhance its high level of technological advantage, JDI continuously promotes R&D activities, including the development of new Global No.1 proprietary technologies such as the next-generation OLED "eLEAP." However, if JDI's technologies are not adopted by customers, or if competitors’ technological advancements lead to a relative decline in JDI's superiority, it could result in decreased sales, thereby impacting its business, performance, and financial condition.

Countermeasures

As a technology-driven company built on proprietary technologies, JDI is committed to addressing societal and human challenges. In its R&D efforts, JDI carefully selects research targets, conducts progress reviews during development, and decides whether to continue or discontinue projects based on its technology strategy, which considers competitor developments, product commercialization trends, and customer needs.
To continuously secure technological advantages, JDI has implemented reskilling programs since 2021, focusing on "advanced specialized education" and "digital/AI education" to acquire new technological knowledge and shorten lead times for development and manufacturing. As a result of these initiatives, JDI has already begun efficient development and manufacturing using digital technologies, with plans to further expand their application.
 

③ Collaboration and Partnerships with Other Companies

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

JDI collaborates with external companies, including material suppliers, equipment manufacturers, and customers. These collaborations aim to strengthen competitiveness, improve profitability, maintain a long-term supply system, and develop new technologies and products.
To further enhance competitiveness, JDI may pursue new collaborations, strategic partnerships, investments, or acquisitions in the future.
However, these corporate strategies may not be maintained or implemented due to various factors such as financial constraints, changes in strategic goals, issues in technology management or product development, regulatory approvals, and market fluctuations. In addition, if these initiatives fail to deliver sufficient results after implementation, JDI's performance and financial condition could be adversely affected.

Countermeasures

When engaging in corporate collaborations, investments, or other partnerships, JDI conducts risk analyses of target markets, businesses, and the financial conditions of partner companies before making decisions. During implementation, JDI monitors the progress of collaborations and partnerships and makes strategic adjustments or organizational changes as necessary to execute effective business portfolio management. Recently, JDI signed a capital and business alliance agreement with a U.S. company and has begun collaborating to establish a display fab in the United States.

(2) Financial Risks

① Fundraising

Likelihood of Occurrence: High         Impact Level: Significant

Risk

JDI secures operating funds through borrowings from Ichigo Trust. For future funding needs, JDI plans to implement appropriate fundraising measures, including additional borrowings, the sale of low-efficiency assets, and the liquidation of trade receivables. JDI is also considering requesting the exercise of stock acquisition rights granted to Ichigo Trust as part of its funding strategy.
However, if JDI encounters difficulties in borrowing from Ichigo Trust or financial institutions, or if other fundraising methods do not function effectively, or if asset sales do not proceed as planned, JDI may be unable to secure necessary funds. This could hinder its business operations.
In addition, increased interest payments associated with borrowings could negatively impact JDI's financial condition. If the stock acquisition rights are not exercised or only partially exercised, there is a risk of insufficient funding. Conversely, if the rights are exercised, the resulting dilution of shares could reduce the ownership ratio of existing shareholders and potentially affect shareholder value.

Countermeasures

JDI is working to build an organizational and staffing structure that aligns with its business scale. Measures include the cessation of production at the Mobara Fab, announced in February 2025, and workforce reductions announced in May 2025. In addition, JDI aims to diversify and expand its fundraising options by improving business performance through the promotion of the BEYOND DISPLAY growth strategy. Through these initiatives, JDI seeks to improve cash flow, strengthen cash management, gradually reduce its dependence on external funding, and enhance financial stability.
 

② Foreign Exchange Fluctuations

Likelihood of Occurrence: High    Impact Level: Medium

Risk

JDI's customers and business partners include many overseas companies, such as those in Europe, the United States, and China. Fluctuations in foreign exchange rates can affect the pricing and costs of products and services traded in foreign currencies, potentially impacting JDI's business, performance and financial condition. In addition, the assets and liabilities of overseas subsidiaries, which are denominated in local currencies, are converted into Japanese yen when preparing consolidated financial statements. As a result, JDI's financial position is also subject to the effects of foreign exchange fluctuations.

Countermeasures

To minimize the short-term impact of major currency fluctuations, JDI employs operational hedging measures such as foreign exchange matching (offsetting dollar-denominated payments with dollar-denominated collections) and netting (shortening settlement periods for foreign currency receivables and payables). These measures help reduce foreign exchange risk. Although JDI currently faces constraints in establishing long-term hedging transactions, the company plans to reconsider optimal hedging strategies once its credit standing improves.
 

③ Relationship with the Controlling Shareholder

Likelihood of Occurrence: High          Impact Level: Significant

Risk

As of March 31, 2025, Ichigo Trust is JDI's controlling shareholder, holding 78.2% of JDI's voting rights and exerting significant influence over resolutions at the General Meeting of Shareholders.
In addition, Scott Callon, a director of JDI, serves as the representative director and CEO of Ichigo Asset Management, Ltd., the investment advisor to Ichigo Asset Management International, Pte. Ltd., which is the investment manager of Ichigo Trust. If Ichigo Trust decides to sell its shares in JDI, the method and scale of such a sale could affect the supply-demand balance and market price of JDI's shares.

Countermeasures

In FY2020, JDI transitioned to a Company with Three Committees. These include the Audit Committee, Nominating Committee, and Compensation Committee, each composed of a majority of external directors. This structure is designed to ensure the independence and transparency of JDI’s management.
In addition, independent directors make up the majority of JDI's Board of Directors, establishing a system to appropriately monitor and mitigate the influence of the controlling shareholder.
Regarding transactions with Ichigo Trust and its related companies, Scott Callon does not participate in the Board of Directors’ deliberations or resolutions concerning such transactions, in order to avoid conflicts of interest.
Furthermore, to comply with the listing standards of the Tokyo Stock Exchange Prime Market, JDI is working to improve the soundness of its shareholder composition by reducing Ichigo Trust’s ownership ratio.
 

④ Non-Compliance with Listing Maintenance Standards

Likelihood of Occurrence: High          Impact Level: Significant

Risk

As of March 31, 2025, JDI’s free-float ratio stands at 20.1%, which does not meet the Tokyo Stock Exchange Prime Market’s listing requirement of 35% or higher. Through its capital alliance with Ichigo Trust, JDI has been granted a special exemption, allowing a compliance plan period until the end of March 2028. If JDI fails to meet the standard within this period, it will be subject to delisting. In addition, Ichigo Trust holds 79.2% of JDI’s common shares, and the conversion of preferred shares or the exercise of stock acquisition rights could further reduce the free float ratio.
JDI may also fall into a state of negative equity by the end of FY2025, which would result in non-compliance with another listing requirement. In such a case, JDI must resolve the negative equity issue by the end of FY2026 to maintain its listing. Although JDI is working to avoid and promptly resolve negative equity through asset sales and other financial measures, failure to implement these measures as planned could lead to delisting.

Countermeasures

To comply with the listing requirement for the free-float ratio, it is essential to reduce Ichigo Trust’s ownership percentage. JDI is therefore continuing to engage in discussions and negotiations with potential investors who may become new holders of JDI shares. JDI also recognizes the importance of improving investor and market stakeholder understanding. To this end, JDI is committed to proactive information disclosure and enhance communication, including briefings for both domestic and international audiences.
To address the negative equity issue, JDI is focusing on recording gains from asset sales as its primary countermeasure. Concurrently, JDI is implementing significant fixed cost reductions, including the cessation of production at the Mobara Fab, workforce reductions, and cuts to executive compensation, bonuses, and employee bonuses. Under the BEYOND DISPLAY growth strategy, JDI is working to strengthen profitability and improve its financial structure. As part of its capital policy to maintain its listing, JDI may request Ichigo Trust to exercise the stock acquisition rights it holds.
By comprehensively implementing these measures, JDI aims to avoid negative equity, improve the free-float ratio, and maintain its listing status.
 

⑤ Significant Events or Conditions Related to the Going Concern Assumption

Likelihood of Occurrence: High          Impact Level: Significant

Risk

JDI is facing conditions that raise substantial doubt about its ability to continue as a going concern. In FY2024, JDI recorded operating losses for the eighth consecutive year, significant impairment losses, and net losses attributable to JDI shareholders for the eleventh consecutive year. As a result, net assets declined, and total shareholders’ equity turned negative.
JDI also continues to face a challenging competitive environment, compounded by factors such as the impact of U.S. tariff policies, persistently high costs for raw materials, energy, and transportation due to global inflation, and declining customer demand leading to reduced sales. These challenges raise concerns about delays in achieving profitability and a return to positive earnings. In addition, depending on the outcomes of future fundraising efforts, there is a risk of significant impacts on JDI's cash flow, creating material uncertainty regarding the going concern assumption.

Countermeasures

JDI is actively promoting its BEYOND DISPLAY growth strategy, which aims to shift away from being a display-focused manufacturer by adding sensors and advanced semiconductor packaging as new pillars of its business. Through the restructuring of its product and business portfolio, JDI seeks to achieve early profitability and drive business growth. In the display business, JDI plans to end production at its Mobara Fab by March 2026 and consolidate production at its Ishikawa Fab to reduce costs. To further advance the BEYOND DISPLAY growth strategy and enhance competitiveness, JDI also plans to transfer its automotive display-related business to a newly established company, AutoTech Inc., through a company split effective October 1, 2025*.
On the financial front, JDI is working to stabilize its financial foundation by implementing timely and appropriate fundraising measures. These include flexible borrowing in response to funding needs, selling assets that are not aligned with JDI’s business scale, liquidating trade receivables, and requesting the exercise of stock acquisition rights granted to Ichigo Trust. By executing these measures, JDI aims to resolve its going concern issues, achieve financial stability, and lay the foundation for sustainable business growth.
Note: As of September 11, 2025, the effective date for the establishment of the new AutoTech subsidiary has been postponed from October 1, 2025 to April 1, 2026.

(3) Hazard Risks

① Major Earthquakes, Natural Disasters, and Infectious Diseases

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

JDI’s business performance could be significantly affected if a major earthquake, large-scale typhoon, flood, or other natural disaster caused by climate change were to damage employees, facilities, or the supply chain, resulting in substantial disruptions to product supply. Similarly, incidents such as fires or explosions that cause serious harm to employees or surrounding areas could not only severely impact JDI’s business performance but also lead to a loss of societal trust.
In the event of a pandemic, lockdowns or outbreaks of infections at JDI's sites or within its supply chain could disrupt the delivery of products and services.
To mitigate the impact of such disasters, JDI has subscribed to various insurance policies that it considers appropriate for the level of risk. However, these policies may not fully cover all potential damages.

Countermeasures

JDI has established Business Continuity Plan (BCP) regulations and a Crisis Management Committee to minimize the impact of unforeseen events on production activities and ensure rapid recovery. In emergencies, JDI activates disaster escalation protocols to share updates, sets up a response headquarters, and works with relevant departments to enable accurate and swift action. JDI has also developed basic safety and health policies and related regulations, establishing a safety and health management system to prevent fires, explosions, and chemical leaks, thereby maintaining safe and stable operations.
As part of its disaster preparedness, JDI conducts regular drills for all employees and provides training on the use of safety confirmation systems. At manufacturing sites, JDI regularly conducts emergency response drills for various risks, including fires and chemical or gas leaks.
In response to pandemics, JDI has implemented guidelines and action plans. These include restrictions on commuting, business trips, and in-person meetings depending on the situation, to reduce infection risks. JDI has also established internal procedures and attendance rules for cases where employees or their cohabiting family members test positive, aiming to prevent the spread of infection and minimize operational disruption.
 

② Information Security

Likelihood of Occurrence: Medium Impact Level: Medium       

Risk

JDI holds confidential information in various forms related to its own technologies, as well as those of customers and suppliers. This includes research and development, manufacturing, sales, business activities, and personal information of stakeholders.
Although JDI implements appropriate management measures to protect this information, there is no guarantee that these measures will remain effective in the future.
If a cyberattack or other incident leads to the leakage of information managed by JDI, and if such information is improperly obtained or used by third parties, it could result in lawsuits for damages and adversely affect JDI’s business performance, financial condition, and social reputation.

Countermeasures

To prevent the loss or leakage of confidential information due to misconduct or other factors, JDI has established an Information Security Policy and related regulations. JDI has also set up an Information Security Committee and manages security in compliance with international standards (ISO 27001).
To mitigate security risks, JDI implements measures such as network monitoring, regular penetration testing to identify potential vulnerabilities, strengthening security protocols to accommodate changes in work styles, and providing regular security education and cybersecurity training for all employees.
In the event of an information security incident, JDI follows an escalation protocol to share updates and works closely with relevant departments to ensure accurate and timely responses.
 

③ Geopolitical Risks

Likelihood of Occurrence: Low        Impact Level: Significant

Risk

JDI operates manufacturing facilities in Japan and the Philippines and outsources assembly processes to EMS (Electronics Manufacturing Services) providers in China and Taiwan. JDI also has global sales offices, with a significant portion of its total sales coming from overseas customers.
In conducting international business operations, JDI is exposed to various geopolitical risks, including economic and political instability in foreign countries, deteriorating relationships with local employees, stricter foreign exchange controls, unexpected new or amended regulations, unfavorable changes in tax systems, legal frameworks, and business environments, administrative measures such as taxation, military impacts from wars or terrorism, and anti-Japanese sentiment that may lead to boycotts. These factors could adversely affect JDI’s business, performance and financial condition.

Countermeasures

In countries and regions where geopolitical risks are increasing, JDI collects information from multiple sources and establishes systems that enable rapid responses. JDI is also considering and implementing supply chain diversification. From a BCP perspective, JDI promotes the decentralization of its production systems, including the establishment of alternative production capabilities in Japan and other locations. In addition, JDI strives to minimize the impact of supply chain disruptions, customer production adjustments due to semiconductor shortages, and rising costs for materials, energy, and transportation on its business operations.

(4) Operational Risks

① Quality

Likelihood of Occurrence: Low        Impact Level: Significant

Risk

JDI has established a rigorous quality assurance system at its domestic and overseas manufacturing facilities, as well as at its production contractors, to deliver high-performance and highly reliable products and services to customers.
However, if defects occur in JDI’s products or services, the company may be held liable under product liability laws or other legal frameworks. In addition, large-scale litigation or product recalls could undermine customer trust, damage JDI’s social reputation, and negatively affect its corporate brand value, business performance, and financial condition.

Countermeasures

Based on its Quality Policy, JDI has developed a quality management system in which all departments involved in planning, design, manufacturing, sales, and services follow the PDCA (Plan-Do-Check-Act) cycle to continuously improving processes in collaboration with suppliers.
For display products, JDI has obtained ISO 9001:2015 certification for its group-wide quality management system. Manufacturing sites for automotive displays have also acquired IATF 16949:2016 certification, an automotive-specific quality management system.
To prevent and address product quality and liability issues, JDI has established and operates preventive and response processes, including FMEA (Failure Mode and Effects Analysis) Management Rule and Product Safety Rule.
To prepare for potential quality issues, JDI has established systems to ensure prompt and reliable corrective actions and customer support.
 

② Procurement of Raw Materials and Components

Likelihood of Occurrence: High       Impact Level: Significant

Risk

JDI procures raw materials, components, and other supplies from multiple suppliers. If supply delays, shortages, or price increases occur, JDI may face production delays, increased costs from alternative procurement, or higher overall procurement expenses. Additionally, if the procured raw materials or components contain defects, flaws, or specification issues, this could result in delays in product delivery to customers, product returns, valuation losses, complaints, or even lawsuits.
Although JDI works to mitigate these risks by managing the quality of procured items and diversifying its supplier base, some raw materials and components are highly specialized, limiting the number of available suppliers or making it difficult to switch. If such procurement risks materialize, JDI’s financial condition and business performance could be adversely affected.

Countermeasures

To address rising raw material prices, JDI seeks to mitigate the impacts by requesting price adjustments for its products and implementing cost reduction measures. For stable procurement, JDI works to maintain appropriate inventory levels, diversify its supply chain, and verify suppliers’ BCP systems in advance to reduce risks. JDI also maintains a database of supplier production regions to enable swift coordination with suppliers in the event of a disaster.
To promote sustainable and responsible procurement, JDI distributes the "JDI Supply Chain Sustainability Guidebook" to all Tier 1 suppliers and Tier 2 suppliers via trading companies, requiring compliance. JDI requires its suppliers to conduct regular self-audits using the "Voluntary JDI Supplier Sustainability Survey" to confirm adherence to these standards.
 

③ Climate Change and Environmental Regulations

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

Frequent and severe natural disasters caused by chronic temperature increases could disrupt JDI's supply chain, reduce productivity, and increase BCP response costs. In addition, intensified efforts toward decarbonization (carbon neutrality) may result in increased financial burdens. Failure to meet customer expectations for environmental initiatives could result in reduced business opportunities, while the potential introduction of carbon pricing may adversely affect JDI’s business performance and financial condition. Moreover, stricter environmental laws and regulations, both domestic and international, could raise compliance costs. In cases of non-compliance, JDI may face adverse impacts on its business performance and social reputation.

Countermeasures

JDI recognizes climate change as one of its key management priorities and promotes environmental initiatives under the leadership of its CEO, who holds the highest level of responsibility for environmental matters. JDI conducts scenario analysis based on the TCFD (Task Force on Climate-related Financial Disclosures) framework to identify risks and opportunities related to climate change.
As an adaptation measure to the physical impacts of climate change, JDI is diversifying its supplier base and maintaining appropriate levels of product inventory. It also evaluates optimal inventory levels for raw materials and components based on BCP assessments and is strategically planning to expand external manufacturing outsourcing.
To comply with environmental regulations, JDI has established an environmental management system to ensure strict adherence to laws and timely responses to regulatory changes. JDI also discloses environmental performance data, including greenhouse gas emissions, and obtains third-party assurance to enhance transparency and reliability. In addition, JDI actively promotes energy-saving and renewable energy initiatives to prepare for the potential introduction of carbon pricing.
 

④ Internal Controls and Compliance

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

In FY2019, JDI identified inappropriate accounting practices in past financial statements, revealing a material weakness in its internal controls related to financial reporting. As a result, in July 2020, shareholders filed a lawsuit against JDI and 10 former directors, seeking JPY 3,858 million in damages. To address this issue, JDI established a Governance Improvement Committee and implemented company-wide measures to prevent recurrence. The material weakness was resolved by the end of FY2020, and effective internal control reporting has been maintained since then.
However, if these preventive measures fail to function effectively or new internal control deficiencies arise, the reliability of JDI’s financial reporting could be adversely affected.
JDI is also subject to various domestic and international regulations, including those related to commercial transactions, antitrust laws, intellectual property rights, product liability, environmental protection, human rights, labor safety, and import/export controls. Violations of these regulations could result in penalties, criminal sanctions, suspension of business transactions, or significant damage to JDI’s social reputation, potentially causing substantial harm to the company.

Countermeasures

To prevent the recurrence of inappropriate accounting practices, JDI continues to implement measures such as systematizing its accounting operations. Regarding the ongoing lawsuit, JDI is responding appropriately based on the plaintiffs' claims.
Under its Fundamental Policy for Compliance, JDI has established a Compliance Committee that serves as a platform for relevant departments to deliberate and promote measures aimed at establishing, disseminating, and embedding compliance systems and practices. JDI has also introduced a Whistleblowing System to address compliance violations and maintain social trust. To monitor compliance and encourage whistleblowing, JDI conducts periodic compliance surveys among employees.
To ensure strict adherence to antitrust laws and competition laws in various countries, JDI continues to strengthen education and training programs, as well as its response measures when incidents occur.
 

⑤ Securing Human Resources

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

JDI recognizes the recruitment and development of talented personnel as a critical issue. However, intensified competition for talent, delays in training programs, or the loss of highly skilled personnel to competitors could adversely affect JDI’s business operations, performance, and financial condition.

Countermeasures

JDI conducts systematic recruitment of both new graduates and mid-career professionals while fostering a work environment that enables diverse talent to thrive. This includes promoting flexible work styles and utilizing an internal job posting system. To enhance employee motivation, JDI is expanding its educational programs to support skill development, ensuring placements that reflect individual aptitudes, and establishing systems to promote work-life balance.
 

⑥ Intellectual Property Rights

Likelihood of Occurrence: Medium Impact Level: Medium     

Risk

JDI strives to secure intellectual property rights in appropriate countries and regions to protect its proprietary technologies. However, in some jurisdictions, sufficient protection may not be attainable.
JDI also obtains licenses to use intellectual property rights from third parties. In the future, there is a risk that JDI may be unable to obtain necessary licenses, may only be able to obtain them under unfavorable conditions, or may face reduced competitiveness if competitors secure more advantageous licensing terms.

Countermeasures

During the development and design of new technologies, JDI conducts thorough prior art searches and ensures a clear understanding of the intellectual property laws, examination standards, and procedures in each country to improve the accuracy of intellectual property acquisition. Before launching products, JDI also conducts detailed investigations into third-party intellectual property rights. In addition, JDI integrates intellectual property rights into its business strategies and R&D efforts to maximize their value, building a robust portfolio of high-value intellectual property.
To prepare for potential claims of infringement or renegotiation of licensing terms, JDI has assigned specialized personnel and established a system to respond appropriately in collaboration with external legal counsel.
Under an MOU dated May 15, 2025, JDI agreed to transfer certain intellectual property rights, including patents, to Ichigo Trust. However, JDI will retain rights aligned with its business scale and has secured usage rights for the transferred intellectual property. JDI believes this transfer will not hinder its future business operations.
 

⑦ Human Rights

Likelihood of Occurrence: Medium Impact Level: Significant

Risk

If human rights violations such as forced labor or child labor occur within JDI’s supply chain, it could lead to difficulties in procuring raw materials and components, as well as the suspension of transactions with customers or other suppliers. Such situations could negatively impact JDI’s business performance, financial condition, and social reputation.
In addition, under the U.S. Uyghur Forced Labor Prevention Act (UFLPA), products involving China's Xinjiang Uyghur Autonomous Region are presumed to have been produced using forced labor and are generally prohibited from importation. If this leads to deteriorated relationships with suppliers or trade restrictions at the national level, JDI’s business performance and financial condition could be adversely affected.

Countermeasures

JDI promotes measures aligned with the United Nations Guiding Principles on Business and Human Rights (UNGP). To address human rights issues within its supply chain, JDI distributes the "JDI Supply Chain Sustainability Guidebook" to suppliers and requires their compliance. JDI also requests suppliers to conduct regular self-audits to verify adherence to these standards. regular self-audits using its “Voluntary JDI Supplier Sustainability Survey” to verify adherence to these standards.
For responsible mineral sourcing, JDI conducts conflict minerals investigations to ensure that no funds are provided to armed groups.
In addition, JDI provides regular employee training to raise awareness of human rights and harassment issues.