Sustainability Report

2019Your Partner in

ircular Economy

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Contents

Fundamental support
for the social system ofresource circulation

Domestic sites
Head office＝★

Chitose City, Hokkaido

Matsumoto City, Nagano

ENVIPRO HOLDINGS Inc., a leading resource
recycling company listed on the First section of theTokyo Stock Exchange, is engaged in a Resource
Circulation Business (reuse, recycling, andremanufacturing segments) across supply chains in thevenous industry (recycling industry), involved in theprocessing and distribution of ferrous and nonferrous
metals, and plastic resources as well as waste
management. Having successfully developed thetechnology to accurately sort and concentrate materials
during the crushing and sorting process, we are engaged
in resource circulation globally by recycling andmanufacturing recycled raw materials.
We promote global resource circulation, focusing on
ferrous and nonferrous metal scrap and used cars,
through our business sites in Asia, Europe, the Middle
East, Africa and Latin America in addition to ourmultiple domestic sites.

ARBIZ Corporation★SYN ECO Inc.
★ASTOCO Inc.

Azumino City, Nagano
SYN ECO Inc.

ASTOCO Inc.

Saitama City, Saitama
ASTOCO Inc.

Ichinomiya City, Aichi
ECONECOL Inc.

Hakodate City, Hokkaido
Maebashi City, Gunma
Tokyo

ENVIPRO HOLDINGS Inc.
★Bright Innovation Co., Ltd.
ECONECOL Inc.
TOYO RUBBER CHIP Co., Ltd.

★3WM Co., Ltd.
★PLA 2 PLA Inc.

★ARBIZ Corporation

Kawasaki City, Kanagawa
ASTOCO Inc.

Yokohama City, Kanagawa
3WM Co., Ltd.

Fujinomiya City, Shizuoka★ENVIPRO HOLDINGS Inc.
★ECONECOL Inc.
★VOLTA Inc.
ASTOCO Inc.

Osaka City, Osaka
3WM Co., Ltd.

■ Consolidated subsidiaries

Onojo City, Fukuoka(including overseas companies)

Hamamatsu City, Shizuoka

TOYO RUBBER CHIP Co., Ltd.

12 companies★Fuji Eco Cycle Co., Ltd.
ECONECOL Inc.

Kumamoto City, Kumamoto
TOYO RUBBER CHIP Co., Ltd.

Shipping ports■ Domestic yards

12 yards■ Domestic processing sites

10 sites

Locations

Yards

02

Company profile03

Top message

07

Sustainability Strategy

08

Resource Circulation Business

14

Used-cars-related Business

23

Global Resource Circulation Business24

Society

27

Business foundation / Growth foundation

31

References

35★KURODA RECYCLE Co., Ltd.

★TOYO RUBBER CHIP Co., Ltd.

Nagoya City, Aichi

Contents / Editorial policy

LocationsYards

Hakodate Port, Hokkaido

Ferrous sscrapyard

Tagonoura Port, Shizuoka

Ferrous scrapyard

Naoetsu Port, Niigata

Ferrou s scrapyard

Shimizu Port, Shizuoka

Ferrous scrapyard, Nonferrous scrapyard

Funabashi Port, Chiba

Ferrous scrapyard, Nonferrous scrapyard

Tobishima New Port, Aichi Used car yard

Sakura City, Chiba

Used car yard

Nagoya Port, Aichi

Ferrous scrapyard

Kawasaki Port, Kanagawa Ferrous scrapyard, Nonferrous scrapyard

Minami Port, Osaka

Nonferrous scrapyard

Yokohama Port, Kanagawa Used car yard

Amagasaki Port, Hyogo

Ferrous scrapyard

Editorial Policy
This sustainability report is issued by
ENVIPRO HOLDINGS Inc. The report
describes the corporate philosophy of ourgroup and our overall activities in nonfinancial areas including businessstrategies, environmental performance,and corporate governance. Some businessprospects including our future plan are
also presented here.
Scope of report
The report presents the activities of
ENVIPRO HOLDINGS Inc. and thefollowing nine subsidiary companies:
ECONECOL Inc., 3WM Co., Ltd.,KURODA RECYCLE Co., Ltd., SYNECO Inc., ASTOCO Inc., TOYORUBBER CHIP Co., Ltd., VOLTA Inc.,
Bright Innovation Co., Ltd., and PLA 2
PLA Inc.
Reporting period
July 2018 - June 2019
(The report includes some activities andplans beyond the period specified above)

Sustainability Report 20192

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Overseas sites● Sales sites for recycled resources
Business sites for used cars
● Business sites for biomass fuel
ECONECOL Europe Representative Office (UK)
*Established on October 1, 2019Japan Coast Used Cars and Spare Parts
Trading (United Arab Emirates)

3WM Uganda Limited(Uganda)

ECONECOL Ho Chi Minh
Representative Office (Vietnam)

Mine Biomass Synergies PKS■ Sales by region

57%

stockyard (Indonesia)

Asia*57% of recycled resources are sold in the
Asia region.

35%

Japan

Mine Biomass Synergies

Mine Biomass Synergies

PKS stockyard (Malaysia)

Office (Singapore)

3WM Chile Import Export
Limitada (Chile)

Latin
4% America
North

3% America
1%

Africa
ECONECOL Europe Representative Office

ECONECOL Ho Chi Minh Representative Office

Mine Biomass Synergies PKS stockyard (Malaysia)

3WM Chile Import Export Limitada

Sustainability Report 20193

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Company profile

株式会社
東洋ゴムチッ

Subsidiary Companies

株式会社
東洋ゴムチップ

ECONECOL Inc.

3WM Co., Ltd.

KURODA RECYCLE Co., Ltd.

VOLTA Inc.

Bright Innovation Co., Ltd.

PLA 2 PLA Inc.

The company is engaged in thecollection and recycling of minor
metals, such as nickel and cobalt,
from lithium-ion rechargeable
batteries, nickel hydrogen
rechargeable batteries, and otherbatteries, the demand for which is
expected to further increase. It also
undertakes the recycling of casingsother than batteries.

The company offers consulting services
to help companies formulate their own
environmental strategies, CO2 emission
reduction strategies and others, which
are becoming increasingly important totheir operation and management. It also
proposes solutions such as theimplementation of renewable energy.

The company is a recycled raw
material manufacturer that wasestablished through cooperation
between a recycling company and acompounding company. Collecting
disposable plastics, it producespellets (recycled raw materials) thatare used for making new plastic
products.

Since being established in Fujinomiya
City, Shizuoka in 1950, the company
has been globally engaged in a
recycling business that primarily deals
with metal scrap, a processing andsales business that deals with recycledmaterials including minor metals,
plastics and biomass, and a tradingbusiness that contributes to the global
circulation of recycled resources.

The company globally supplies highquality Japanese used cars andmaintenance parts through its overseas
sites in UAE, Chile and others. It also
globally promotes the reuse of usedcars/maintenance parts through its
international transactions of usedmaintenance parts.

Since being established in 1922, thecompany has been engaged in acommunity-based recycling businessin Southern Hokkaido, centering on
Hakodate City. It pursues the policyof the founder which is to “value
anything at hand,” for instance, bycollecting ultrafine precious metals
left in the dust.

3507-19 Yamamiya, Fujinomiya-shi,
Shizuoka, 418-0111
TEL: +81-544-58-5800
FAX: +81-544-58-5807

Chikko bldg. 2F, 2-3-5 Hama, Minato-ku,
Nagoya-shi, Aichi, 455-0036
TEL: +81-52-659-5200
FAX: +81-52-659-5208

246-27 Nishikikyo-cho, Hakodate City,
Hokkaido, 041-0824
TEL: +81-138-49-8880
FAX: +81-138-49-8960

3507-19 Yamamiya, Fujinomiya-shi,
Shizuoka, 418-0111 (c/o ECONECOL
Inc.) TEL: +81-544-66-3132
FAX: +81-544-66-3133

株式会社株式会社

SHINKAWA EAST 2F, 1-23-5 Shinkawa,
東洋ゴムチップ
Chuo-ku,
Tokyo,
104-0033
東洋ゴムチップ
TEL: +81-3-6280-3936
FAX: +81-3-6280-3937

14-24 Showa-cho, Minato-ku, Nagoya-shi,
Aichi, 455-0026
TEL: +81-52-626-5100
FAX: +81-52-626-5103

Consolidated subsidiaries

株式会社
株式会社 東洋ゴムチップ

SYN ECO Inc.

ASTOCO Inc.

東洋ゴムチップ
TOYO RUBBER CHIP Co., Ltd.

The company is engaged in acommunity-based recycling businesssuch as “Mottainai BOX” and“Comfortable Life Support” inMatsumoto City, Azumino City, andtheir environs in Nagano. In 2018 it
was awarded a commendation by thegovernor of Nagano as a
distinguished company in theemployment of persons withdisabilities.

The company helps persons withdisabilities find a suitable job andbecome a self-supporting member ofthe public, by training them on how
to sustain their livelihood andintegrate themselves into society, in
addition to the job training on
relevant knowledge and skills.

The company is a pioneer in rubberrecycling, making effective use ofindustrial rubber scrap over half acentury, mainly operating in
Maebashi City, Gunma. It
manufactures a wide range of
products from the flooring for playequipment in parks and schools, andthe flooring for gymnasiums, torailroad crossing panels, which allcontribute to enhancing the safety ofvarious facilities.

2346 Shimadachi, Matsumoto-shi, Nagano,
390-0852
TEL: +81-263-47-3211
FAX: +81-263-47-3213

2346 Shimadachi, Matsumoto-shi,
Nagano, 390-0852
TEL: +81-263-31-3440
FAX: +81-263-48-3067

1573 Fukazu, Kasukawa-machi, Maebashishi, Gunma, 371-0215
TEL: +81-27-285-3131
FAX: +81-27-230-6008

Equity method affiliates
ARBIZ Corporation

Fuji Eco Cycle Co., Ltd.

A joint venture with USS Co., Ltd.,
operating in and around the Chukyo
region. It is engaged in a recycling
business that crushes and sorts
various types of waste including
scrap cars, adopting a unique system
for turning waste into resources.

A joint venture with five household
appliance companies including
FUJITSU GENERAL LIMITED.
Pursuant to the “Home Appliance
Recycling Law,” it is engaged in a
“Home Appliance Recycling
Business” that aims to reduce waste
and the disposal of environmentallyhazardous materials, and to create acircular society where economic
growth and environmental protection
are mutually compatible.

14-24 Showa-cho, Minato-ku, Nagoya-shi,
Aichi, 455-0026
TEL: +81-52-619-6600
FAX: +81-52-619-6601

1930-4 Nakagawa, Hosoe-cho, Kita-ku,
Hamamatsu-shi, Shizuoka, 431-1304
TEL: +81-53-523-1152
FAX: +81-53-523-1153

Sustainability Report 20194

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Company profile

Group History
History after the establishment of the company

History before the establishment of the company

1950
1978

Mar.
Jul.

Katsuyoshi Sano (father of Tomikazu Sano,
President/CEO of ENVIPRO HOLDINGS
Inc.) established SANO MARUKA SHOTEN.
Reorganized into SANO MARUKA SHOTEN
Co., Ltd. with capital of 20 million yen.

Aug. Launched a trading business.

1992

2000

2001

Oct.

Installed a large shredding machine in thefactory at head office.

Apr.

Established Fuji Eco Cycle Co., Ltd. as a
joint venture with FUJITSU GENERAL
LIMITED.

Jul.

Renamed the company from SANO MARUKA SHOTEN Co., Ltd.
to SANO MARUKA Co., Ltd.

Jul.

Launched a plastic recycling business.

Aug.

Established an RPF factory (Refuse Paper and Plastic Fuelproduction factory).

To transition into a pure holding company, establishedCompany Name ENVIPRO HOLDINGS Inc.

Inc.) in Fujinomiya City, Shizuoka.

Address

May. ECONECOL HOLDINGS Inc. (Present ENVIPRO HOLDINGS

2010

Jul.

Renamed the company from ECONECOL HOLDINGS Inc. to

Acquired a 100% stake in Recycle Support Service LLC. (Present

2011

Apr.

2012

May. 3WM Co., Ltd. established 3WM UGANDA LIMITED (Uganda).

SYN ECO Inc.), making it a subsidiary.

● Tokyo Office

SHINKAWA EAST 2F, 1-23-5 Shinkawa, Chuo-ku,
Tokyo, 104-0033, JAPANTEL: +81-3-6280-3938
FAX: +81-3-6280-3937

Sep. Listed on the Second Section of the Tokyo Stock Exchange.

2013

Dec. Established ECOMMIT Inc.(present ASTOCO Inc.).

● Head Office87-1 Tanaka-cho, Fujinomiya-shi, Shizuoka,
418-0075, JAPANTEL: +81-544-21-3160
FAX: +81-544-21-3163

ENVIPRO HOLDINGS Inc.

Representative
Director

Tomikazu Sano

EstablishedMay 21, 2010

Capital1,524,830,656 yen

Business

Management and operation of affiliated subsidiarycompanies and associated works

Group
Companies

Twelve consolidated subsidiaries (including secondgeneration subsidiaries), two equity method affiliates

ECONECOL Inc. established a Ho Chi Minh Representative Office2015Feb. (Vietnam).
Dec.

Acquired a 100% stake in TOYO RUBBER CHIP Co., Ltd.,making it a subsidiary.

2003

Dec. Established ARBIZ Corporation as a joint venture.

2004

Nov. automobile shredder residue pursuant to the Act on Recycling, etc.

2006

Jul.

Established 3WM Co., Ltd.

2007

Jul.

Renamed the company from SANO MARUKA Co., Ltd. to
ECONECOL Inc.

Sep. Transitioned to a company with an audit and supervisory committee.

Feb.

3WM Co., Ltd. established JAPAN COAST USED CARSAND SPARE PARTS TRADING (UAE).

Jan.

Jun.

Acquired a 100% stake in KURODA RECYCLE Co., Ltd., making
it a subsidiary.

Jun.

3WM Co., Ltd. established 3WM CHILE IMPORTEXPORT LIMITADA (Chile).

2008

Company Profile

2016

Apr. Established Bright Innovation Co., Ltd.

Authorized by the Minister as a resource recovery plant for

Invested in MINE BIOMASS SYNERGIES PRIVATED

Apr. LIMITED (Singapore) for the stable procurement of wood biomassof End-of-Life Vehicles.

fuel.

2017

2018

Jul.

Established PLA 2 PLA Inc. as a joint venture.

Established VOLTA Inc.
Listed on the First Section of theTokyo Stock Exchange.

Jun.

The first company listed on the Tokyo
Stock Exchange in the industry* The Second Section of the TSE in 2013 andthe First Section of TSE in 2018

Sustainability Report 20195

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Company profile

Outlook (actual performance in the period that ended June 2019)

Sales

Ordinary profit/ratio(Units: 100 million yen)

(Units: 100 million yen)

374

400

291

300

ROE

14

363

12

291

10
8

200

2.9％
8.5

3.4％

3.5％

10.0

13.1

4.0％

3.1％
11.4

2.0％

6
4

100

3.0％

1.0％

2
0

2016/62017/62018/6

2019/60
2016/62017/6(year/month)

2018/6

2019/661kg

Silver: approx. 845kg

0.0％(year/month)

Resource recovery rate

Precious metals collected

Gold: approx.

7.1%

Resources
processed

258ktons

Resources
circulated

405ktons

97.6%
Sustainability Report 20196

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Top Message : Corporate Philosophy

We will exert group-wide
efforts to “contribute tocreate a sustainable
society.”
Corporate Philosophy
Creative Company

Engage in the ongoing creation of businesses that society needs-Engage in everyday work in the spirit with which the company wasestablished-Create new businesses in the spirit of the founder for generations to come-Every employee to exert efforts to become the leading player of a businessthat suits them

Circular Company

Help others, get the best out of others, and share with others to make aconstant loop of joy-Help each other and lend a hand to others to make your work more pleasant-Use every material repeatedly, preserving their value for as long as possible-Share the profit and joy with the people you live with

Company pursuing virtue

Pursue the virtue of companies and people, in perpetuity-Don’t choose the easy path but choose the path which serves others-Do what others don’t do by taking advantage of your distinctive qualities-Be grateful for your life and don’t be arrogant

Destructive innovation requires every industry to redefine itself, and our company is no exception. To properly respond to this development,
we are required not only to have broader views but also to take focused action. Effectively taking advantage of this ambivalence, we arecommitted to creating a unique business field of our own that cannot be categorized into any existing industry.
As a guiding principle of this commitment, we developed the “Sustainability Strategy” last year. We will support the foundation of social
infrastructure by developing technologies which utilize/circulate resources and energy in a sustainable manner, and building a circularsystem, thereby enhancing the sustainability of society. By espousing our mission, which is to “contribute to create a sustainable society,”
we are fully committed to synchronize our growth with the progress made toward a sustainable society, thereby justifying our reason toexist in society. In other words, we will be recognized in society as an “essential company” and create a positive loop whereby our
economic value increases as our value in society increases. This is our basic principle set out in the sustainability strategy.
On the other hand, to prepare for unforeseeable changes, we must train our employees and also recruit new employees, as well as having asolid business foundation substantiated by appropriate governance. In addition, our growth foundation must be further strengthened by
improving productivity and developing new technologies, new markets, etc. On top of this, we will nurture a corporate culture in which all
employees take actions that are consistent with the corporate philosophy, the mission, strategies, key policies, and implementation plans ona daily basis, with both individuals and the organization growing together through our daily activities. The benefits created through thisprocess will help build more alliances and more partnerships. By bringing these together, we will grow into a stronger organization that isfull of positive energy.

Supervised by Mr. Yoshiharu Shimizu, Mirai Design Research Institute Enishiya
Effective March 20, 2004

Go forward with a unified team.

Tomikazu Sano
President, Representative Director
ENVIPRO HOLDINGS Inc.

Sustainability Report 20197

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Sustainability Strategy to overcome non-continuous changes and to sustain business growth
Mission Statement

Mission Statement

Contribute to createa sustainable society

Sustainability Strategy(Five-year strategy for the period from FY2018 to FY2022)

Resource Circulation Business

Goal

Recycling

Remanufacturing

Reuse

Global Resource
Circulation Business

Sustainability
Strategy

Environment Management
Consulting Business

Used-cars-related
Business

Welfare Service
Business for Persons
with Disabilities

To achieve concurrent
sustainability ofsociety and our company
Key policies

Greatly enhance the company’s credibility
in society

Effectively demonstrate the HOLDINGS’ leadershipwithin the group to improve corporate governanceand promote the brandGreatly enhance efficiency in the use ofoperational resources
Consolidate businesses in line with the Sustainability
Strategy for the efficient use of operational resources

Greatly enhance productivity
Greatly enhance productivity by making use of newtechnologies and experience

Growth Foundation

The ENVIPRO Group espouses the mission statement, which is to“contribute to create a sustainable society.” The mission statement
demonstrates how our group will contribute to society through ourbusinesses, which is our purpose for existing. It indicates thegeneral, unchanging direction for our group to follow, no matter
how the times and social environment change. This is also a
message to those people who feel empathy with this statement to“work together to this end.”

Sustainability Strategy
To ensure the achievement of the mission above, our group has
developed the Five-year Sustainability Strategy (FY2018 FY2022). By focusing on businesses that address unsustainableconditions in society, we will promote the sustainability of bothsociety and our company.
Based on the corporate philosophy, we will restructure and establish
a set of systematized mechanisms, ranging from the mission and thestrategies to the implementation plans over years. Linking the
Sustainability Strategy with the implementation plans developed byour group companies through the steady operation of the newmechanisms, we will enhance the implementation levels, thereby
achieving our mission.

Business Foundation

Corporate Philosophy

Sustainability Report 20198

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Verification of business segments to facilitate prompt management decision-making

In the past, our business reports described all activities under the single segmentthat was the “Resource Recycling Business.” However, in order to develop
implementation strategies by segment and facilitate prompt management decisionmaking in response to the drastically changing economic environment, we havedeveloped multiple segments since June 2019: “Resource Circulation Business,”“Global Resource Circulation Business,” “Used-cars-related Business,” and“Others” that includes “Environment Management Consulting Business” and“Welfare Service Business for Persons with Disabilities”.

Business segment

Reuse

Promoting the distribution of used products andmaintenance parts without modifying their functionality
or value.

Resource Recycling
Circulation (Resource recovery)

Promoting recycling by developing highly advanced
technologies that can shred metal scrap and waste, andphysically sort them by material type based on theirdifferent properties.

Resource Circulation Business

Remanufacturing

Recycling

Reuse

Global Resource
Circulation Business

Description

Manufacturing recycled raw materials and articles outof waste and scrap by taking the advancement ofrecycling technologies to the next level.

Company

Processing department,
ECONECOL Inc.
KURODA RECYCLE Co., Ltd.
SYN ECO Inc.
TOYO RUBBER CHIP Co., Ltd.
PLA 2 PLA Inc.
VOLTA Inc.

Equity method affiliates
ARBIZ Corporation
Fuji Eco Cycle Co., Ltd.

Remanufacturing

Used-cars-related
Business

Welfare Service
Environment Management
Business for Persons
Consulting Businesswith Disabilities

Global Resource Circulation

Promoting optimal global resource circulation throughthe import/export and trilateral trading of a wide rangeof resources including metals, plastic scrap, and biomass
fuel.

Used-cars-related

Stocking high-quality Japanese used cars/heavymachinery and used car maintenance parts such asengines, and exporting them overseas as well as
trilateral trading.

3WM Co., Ltd.
(Including the three overseas
subsidiaries)

OthersOffering consulting services specialized in environmental
management, including the provision of support forcompanies to develop their own environmental strategy
and CO2 emission reduction plan.
Further, undertaking the business to help persons withdisabilities secure employment by offering on-the-job
training to enhance their skills.

Bright Innovation Co., Ltd.
ASTOCO Inc.

Foreign trade department,
ECONECOL Inc.

Sustainability Report 20199

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Identifying material issues for the realization of sustainable development
In view of our mission statement, which is to “contribute to create asustainable society,” we examined the strengths of our group and theimpact of these issues on business, in addition to requests fromsociety to address such issues and our purpose for existing. We
subsequently identified “material resources” and“energy resources” as two material issues to the company.

By explicitly designating the business strategy concerning thesematerial issues as the Sustainability Strategy, we will firmly promote
the implementation of any relevant activities.

Step 1

Step 2

Step 3

Identifying business risks/opportunities in society

Examining issues from the three points of view

Identifying material issues

We verified the business and social environments of the company byidentifying the issues and risks both inside and outside of Japan thatcreate unsustainable conditions, the directions that society should
follow to realize a sustainable society, and any associated business
opportunities.

To identify material issues to our company, we examined theidentified business risks and opportunities against the three elementsthat specify material issues: “impact on business,” “strength of ourgroup,” and “effects on society.”

After identifying “material resources” and “energy resources” as our
two material issues, we used them to verify the direction of ourcompany and developed the Sustainability Strategy by applying a
backcasting approach.

In modern times, a wide variety of issues have surfaced which put
the sustainability of society at risk, such as the impacts of climatechange, anticipated shortages of material resources, the declining
birthrate and the aging population. We believe that businesses canplay a crucial role in addressing these issues, which will in turnprovide them with larger markets and more business opportunities.

Process to identify material issues

Unsustainable conditions
・Increasing impacts of climatechange・Material resource limitations
・Limitations of fossil fuelconsumption
・Losing the spirit of generosity
・Increasing adverse effects of shortterm investment
・Development of Asian countries
and their limitations
・Decline of developed countries
・Difficulties in sustaining social
infrastructure
・Increasing number of countries
with an aging population

Exploring sustainability
・Expansion of resource circulation
・Expansion of clean energy

・Development of a service
industry that pursues people’s
happiness・Development of an economy that
promotes local consumption of
locally produced products
・Privatization of public
infrastructure

Elements to identify
material issues
1.Impact on business
2.Strength of our group
3.Effects on society

Material Resources
・Depletion of minor metals/
Shortage of mineral resources
・Reduction of waste/scrap(increasing in Japan and thewhole of Asia)

Energy Resources
・Climate change/
Decarbonized society
・Increasing demand forrenewable energy
・Energy demand (Asia)

・Development of an economy
that promotes local
consumption of locally
produced products (Energy,
resources)

・Accelerating electrification,
automation, and networking
・Expansion of ESG investment
・Growth in China/Asia

Sustainability Report 201910

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Various activities for the achievement of Sustainable Development Goals (SDGs)

The ENVIPRO Group has specified some SDGs that are particularly
relevant to the business and our mission statement, which is to“contribute to create a sustainable society,” and has been
implementing various activities which contribute to the achievementof SDGs, particularly focusing on those specified above.
What are the Sustainable Development Goals (SDGs)?
The Sustainable Development Goals are a collection of international
development goals to be achieved between 2016 and 2030, which
was adopted by the UN Summit held in September 2015. They
consist of 17 goals and 169 targets to realize a sustainable world andpledge to leave no one behind.

Goal 1: Poverty
・With the improvement of the efficiency and the profitability ofour business, including those of the Resource Circulation
Business, we will increase the income of the employees andimprove their quality of life.

Goal 3: Health・ We prevent water and soil pollution and contamination byproperly managing scrap materials at our plants which comply
with safety and environmental standards.

Goals 4 and 10: Education/Equality
・ Under government sponsored programs such as the preemployment transition support program and the type B continuous
employment support program, we provide an environment where
persons with disabilities are able to acquire knowledge and skills,
and support them to be continuously engaged in rewarding work.

Goals 5 and 8: Gender/Working Environment
・ We have created an environment where employees can choose
a working style that fits them best, by introducing various systems
including those for permanent employees with shorter working
hours and telecommuters in order to meet the different needs of
employees including female employees with small children.
・ We thoroughly implement measures to prevent work accidents
in order to ensure the safety of employees.

Goal 7: Energy
・ We joined “RE100*1” in July 2018, setting a goal to match
100% of the electricity consumed in our business activities withelectricity generated from renewable sources by 2050. We haveadopted renewable energy to power our factories, and promote
the introduction of renewable-energy power systems such as theinstallation of solar panels on factory roofs.
・ We promote international transactions of PKS (Palm Kernel
Shell) by establishing container yards in South East Asia. We
will contribute to increasing the supply of sustainable biomass
fuel by expanding our involvement in the supply of wood pellets
in the future.
*1: RE100: a global initiative which brings together companies committed to using
100% renewable energy for the electricity consumed in their businesses.

Goals 9 and 12: Technology Innovation/Consumption and Production
・ We contribute to the circulation of limited resources and reducing
waste by engaging in the recycling business to collect precious metals
from metal scrap and waste, and the remanufacturing business to
produce recycled raw materials. Moreover, we aim to establish asustainable consumption and production mechanism by further
developing the technologies and experience that we have nurtured
over the years. To this end, in 2018 we established a new laboratory
in ENVIPRO HOLDINGS Inc.

Goal 11: Community Development
・“Syn Eco Plaza Azumino” contributes to revitalizing the local
community and the development of a sustainable community
through recycling and creating employment: the collection andrecycling of waste and items disposed by households, and the hiringof persons with disabilities at the factory.

Goal 13: Climate Change
・We contribute to the reduction of CO2 emissions across supply chainsthrough our engagement in the recycling and remanufacturingbusinesses, the mainstay of our company. Furthermore, we promote CO2
emission reductions in the recycling and manufacturing processes bypromoting the purchase of electricity generated from renewable sources
and adopting a renewable-energy power system.
・We help companies reduce CO2 emissions by providing consulting
services for them to formulate their decarbonization strategies as well as
solution services such as the adoption of renewable energy.
・We endorsed the “TCDF (Task Force on Climate-related Financial
Disclosures) recommendations” in May 2019. We will analyze the risks
and opportunities of climate change on our businesses and integrate theminto our business strategies.

Goal 14: Marine Resources
・ We contribute to preventing marine pollution caused by plastics bydeveloping technologies which sort waste plastics and recycle theminto pellets, and expanding the range of recycled raw material use.

Goal 17: Partnerships
・ We contribute to promoting global resource circulation and thecontrol of environmental pollution through the export of reusable
products, including used cars from Japan and internationaltransactions of resources.
・ By joining the following initiatives, we acknowledge ourengagement in environmental businesses and promote activities
which will lead to the realization of a sustainable society.
・Japan Climate Leaders’ Partnership (JCLP)・RE100・CDP*2 Scoring partner*2 CDP: Global initiative concerning the disclosure of climate change-related information.
Sustainability Report 201911

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Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Sustainability Strategy Highlights

Lithium-ion Battery Recycling Plant operations

Launching of High-Filling High-Speed Melting Business

Operations at a recycling plant forlithium-ion batteries started in
September 2018. It promotes thecollection of minor metals (cobalt,
nickel, etc.) from batteries. →P.17

In June 2019, we introduced a newtechnology to mix and fusematerials together that an ordinary
kneader finds difficult to mix. In
collaboration with the
manufacturers of basic materials
and others, we are engaged indeveloping various uses forrecycled materials. →P.21■ Obtained a patent for a technology related to the■ Opening of Syn Eco Plaza Azumino■ Mottainai BOX

In May 2019, we obtained a

Approved by theof silver were collected from waste incineration ash. →P.16

Syn Eco Plaza Azumino, a
recycling center for regional
circular and ecological economy
through recycling, was opened
in April 2019 with the aim ofhelping to address social issues
in the community throughrecycling and employment
creation. →P.19■ TOYO RUBBER CHIP Co., Ltd. has become an■ New laboratory established under ENVIPRO■ Procurement of the retired dedicated aircrafts of

In May 2019, TOYO RUBBER CHIP
Co., Ltd. successfully achieved 100%of the electricity consumed by thefactory with renewable energy,
becoming an “RE100 factory.” Priority
will be given in receiving electricity
from the Komiya Solar Power Plant
owned by a group company. →P.22

The laboratory was established inorder to develop core technologies
through the assessment ofrecycling technologies, analysis ofrecycled raw materials,
accumulation of data, andacquisition of technical know-how. →P.33

In May 2019, we concluded thepurchase and sale agreement for
two retired dedicated aircrafts ofJapanese government (B747-400),
after winning a tender invited by
the Air Self-Defense Force. Theycollection of precious metals from waste
incineration ash

patent for a technology tocollect precious metals fromwaste incineration ash
discharged by general waste
disposal facilities. As of June
2019, we concluded agreements with three municipalities for thepurchase of riddling ash. In FY2018, 22.7 kg of gold and 162.5 kg“RE100 Factory”

HOLDINGS, Inc.

Approved by the “Regulatory Sandbox Framework”

Regulatory Sandbox Framework,
we installed the “Mottainai
BOX” in 13 municipalities
across the northern part of Nagano
in April 2019. Using IoT to manage
the collection boxes installed across a wide area, we promote theefficient collection of material resources and the improvement ofrecycling rates. →P.20

Japanese government

were handed over at the end of June in the same year. We sold usedparts to buyers as resources to be recycled. →P.25
Sustainability Report 201912

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Sustainability Strategy

Circular Economy and Our Group Businesses

What is the Circular Economy?

● Circular Engine of the Circular Economy

In recent years, the circular economy concept has been gaining
considerable attention. This is an alternative economic system to thelinear economy which is characterized by mass-production, massconsumption, and mass-disposal, and the one-way flow of materials.
The circular economy is aimed to reduce wastes and instead use
them circularly as resources.
It is intended to address environmental issues while achieving
economic growth by creating the maximum added value with theminimum investment. This concept is totally consistent with thegoal of our Sustainability Strategy, “to achieve concurrent
sustainability of society and our company.”

The circular economy aims to provide another value for materials
that were once discarded. Our group’s Resource Circulation
Business offers social value to consumers by giving them theopportunity to choose eco-friendly products. It creates new resource
value for disused primary materials. Therefore, our group believes
that we can play a crucial role in the circular economy, performing
the function of an engine for resource circulation.

●Risks and Opportunities
The circular economy is expected to change economic models fromthe simple selling of products to the sharing of products, and theselling of experiences and functions. Furthermore, the flow ofwastes and resources will be potentially adjusted in accordance with
whoever owns the products.
Moreover, if manufacturers start getting involved in the
procurement of necessary resources or recycled raw materials, theboundary between arterial (product supplying) and venous(recycling) industries may disappear, potentially leading to newcompetition among industries. This could pose business risks forour group.
On the other hand, there are also various potential business
opportunities such as the expansion of recycled raw material use
and markets, and the emergence of new business models throughthe development of IoT in the venous industry. Our group needs todecide on our positions where we can take the maximum advantage
of our strengths.

Focusing on the reuse, recycling and remanufacturing of materials,
we will promote the finest technologies for resource circulation
across supply chains, and the development of arterial-venous
collaboration systems through partnerships with manufacturers.
Through these engagements, we will grow into a company that istruly appreciated in a society which is experiencing a transition to
the circular economy.

Roles of Our Businesses in the Circular Economy
Resource Circulation BusinessInformation concerning supply
chains in the venous industry(Functions as an engine for resource circulation)

Remanufacturing

Recycling

Reuse

Recreating resource value

Offering New Resource Value/Social ValuePrimary materials
discarded

Designing

Procuring

Manufacturing

Arterial
industry

Distributing

Using

Linear economy

Disposal

Sustainability Report 201913

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Resource Circulation BusinessResource Circulation Business that enhances the sustainability of a society

Population explosions and the development of developing countries have increased resource consumption
across the world. Continuous resource consumption will cause depletion and generate enormous levels ofwaste, creating environmental problems such as waste plastics flowing into the sea, which is becoming
increasingly serious. It has been arousing concerns about the sustainability of a society.
The ENVIPRO Group promotes the resource circulation business as our key business to achieve our
mission statement that is to “contribute to create a sustainable society.” We offer new value to society,engaging in the effective utilization of limited resources, waste reduction, and the production of recycled
raw materials from waste, by promoting the reuse, recycling, and remanufacturing of materials that were
disposed of as waste.

12.0

300

128

127

9.9

10.0

120

99

100

2.0
2016/62017/62018/60.0

2019/6262

262

2018/6

2019/6

227

200

4.0

80
0

5.5

6.0

86

249

250

8.3

8.0

150

0.3
2016/62017/62018/60

2019/6

2016/62017/6

Recycling
Composite materials of metals, plastics, and glass are shredded, and separated by magnetic/air
separators before undergoing the next separating stage.
Magnetic separation
Removing ferrous scrap from theshredded mixture, using separatorswith a powerful magnetic force.
Powerful magnetic force

Reuse

Air

Nonferrous metals

Removing refuse
paper, sponges, andlight dust from theshredded mixture,using air separators.

Dry gravity separation

RPF(Refuse Paper and Plastic Fuel) plant

Separating, using vibrations andupward-moving air currents withthe application of frictional forces.

Producing solid fuels including RPF(refuse paper and plastic fuel) from waste.

Light particles
LiquidRPF

Heavy particles

Wet gravity separation

Eddy current separation
Separating non-magnetic metals that are falling due to gravity, using magnetic repulsion.

Remanufacturing
Plastics(heavyweight)

ExtruderS N S

Used-cars-related
Business

S N S

Depending on the objects to be removed
from the mixture, adjusting the specificgravity of a liquid that is mixed with waterand a specific metal powder, in order toseparate combinations of items that float
and those that settle.

Incineration

Plastics (lightweight)

Air

N

Global Resource
Circulation Business

Agitation propellers

Air separation
FerrousmetalsMaterials for
cement production

Refuse paper, sponges, and light dust

N SN

Shredding
Shredding materials into small
pieces with a shredder forrecycling.

・ Automobiles ・ Microwave oven
・ Photocopiers ・ Vacuum cleaners
・ Smartphones, etc.
・ Monitors

Aircraft

Handling volume (Units: 1,000 tons)

140

S

Sorting

Ordinary profit (Units: 100 million yen)

NS N

Reuse, recycling, andremanufacturing process

Sales (Units: 100 million yen)

Plastic pellets
Gold and Silver Copper
Sediment Sludge

Used car

Aluminum

Plastics for fuelExtruded materials

Manufacturers of raw/basic materials

Sustainability Report 201914

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TopicsThree key businesses
The ENVIPRO Group operates the resource circulation business,
focusing on the following three businesses as its key components.

1. Recycling Business (resource recovery)
Our group has been engaged for more than half a century in a
recycling business in which metal scrap, waste and others arecrushed, and physically sorted into ferrous and nonferrous metals,
gold, silver, and copper sediment sludge(mixed metals), plastics, etc.
based on differences in their properties. With the use of advanced
sorting technologies based on the above-mentioned technologies aswell as our accumulated know-how, it is possible to condense andcollect ultrafine precious metal particles from both waste incineration
ash and ASR* that seemingly contain no precious metals.
Furthermore, with regard to waste plastics, we have achieved arecycling rate of approximately 97.6%, minimizing simple
incineration and landfilling by producing RPF for thermal recycling.

To become a manufacturer of recycled raw materials for products, wemust maintain product quality, fabricate prototypes, ensure a stableproduct supply, guarantee delivery schedules, and others. We need tohave totally different viewpoints in order to develop technologies andbusiness know-how from the recycling businesses. We are now taking
up these new challenges.

3. Reuse Business (reuse)
We are engaged in a reuse business that distributes used products andmaintenance parts without modifying their functionality or value. The
volume of metal scrap and waste will inevitably decrease in Japan
where more people share goods and products, and where thepopulation is declining. Therefore, for our group which is engaged in
the resource circulation business based on these materials, ourinvolvement in the reuse business is important from the viewpoint of
securing materials for our key businesses.

CO2 reduction throughout the product lifecycle
To realize a sustainable society requires the efficient utilizationof not only material resources, such as mineral resources, butalso energy. Most materials, including steel and plastic
products, which are currently distributed throughout society, aremade from natural resources such as iron ore, petroleum, etc.
The manufacturing processes for these materials consume vast
amounts of energy.
Our group promotes the dissemination of materials produced
from waste through the resource circulation business which isengaged in the sorting/collection of iron from metal scrap andthe development/manufacturing of recycled pellets from waste
plastics. In turn, we contribute to reducing the amount of energy
use and CO2 emissions throughout the product lifecycle
including the procurement of raw materials.
Resource circulation of product materials contributes to the
reduction of CO2 emissions throughout the product lifecycle*ASR: Abbreviation of Automobile Shredder Residue. The residue which remains after end-of-use
vehicles are dismantled and shredded to remove chlorofluorocarbons and their parts, such as air bags,

Reduction of CO2 emissions by resource circulation

doors, and engines, and to collect useful metals.

2. Remanufacturing Business (re-production)
Our group promotes and actively invests in the “Remanufacturing
Business” which aims to manufacture recycled raw materials out of
waste and scrap by taking recycling technologies to the next level.
We are engaged in manufacturing recycled resin pellets from waste
plastics, rubber chips from waste tire rubber, and recycled cobalt andnickel materials from lithium-ion batteries.

Aluminum

StainlessMaterial extraction
production, andTransportation

RPF

Reuse of products
Resource recovery

Procurement

Production

Transportation

Product
Provision of services

Disposal
Recycling

Gold and Silver Sediment Sludge

Sustainability Report 201915

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

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References

Resource Circulation BusinessCollection of precious metals from waste incineration ash (riddling ash)

Undertakings to collect metals from so-called “urban mines,” suchas scrap cars and disposed home appliances, have been gradually
recognized in society since the Act on Promotion of Recycling of
Small Waste Electrical and Electronic Equipment was put into
effect. Nevertheless, a significant proportion of waste incineration
ash that contains a large quantity of metals is still landfilled without
being recycled, although some is recycled as materials for cement
production. Based on our research and accomplishments over theyears, we have successfully developed the technology to collectprecious metals from waste incineration ash discharged by generalwaste disposal facilities, for which we obtained a patent in May
2019. Through the application of this technology, we have not only
improved the recycling rate of waste/precious metals but also
contributed to reducing the landfilling of waste incineration ash.

Volume of waste incineration ash collected

Approx.

2,008 tons

Metal collection process from waste incineration ash (riddling ash)
General Waste Disposal Facility(FY2018)

Volume of precious metals collected from waste incineration ash

Au (gold)
Approx.

Input hopper

Ag (silver)

22.7kg Approx. 162.5kg● Purchase history from municipalities: collection of

precious metals from riddling ash

Riddling ash generated during waste incineration generally has a highmetal content, which can be collected as valuables without modifying
their properties. ECONECOL Inc. concluded agreements with threemunicipalities* for the purchase of riddling ash as of June 2019. By
expanding this undertaking to other municipalities across the country, we
will contribute to the effective use of resources and the reduction oflandfilling.
* Three municipalities: Inzai District Environmental Service Association (Chiba), Tottori Chubu Furusato

Riddling ash*Incinerator bottom ash*Riddling ash: waste and theash that have fallen through thegrate vents in a stoker-type
waste incinerator.

Wide-area Federation (Tottori), and Tama Newtown Environment Association (Tokyo)● Joint venture with Taiheiyo Cement Corporation:

recycling of incinerator bottom ash

Compared with riddling ash, the ash collected from the bottoms ofincinerators has a low metal content and is considered difficult torecycle. ECONECOL Inc. has engaged in a joint venture with Taiheiyo
Cement Corporation, aiming to collect precious metals from incinerator
bottom ash and to recycle the ash after the precious metals are removed
in order to produce materials for cement production. We have installed
equipment for verification tests in the Ofunato Plant of Taiheiyo
Cement and are currently undertaking the tests in collaboration with
REVER HOLDINGS CORPORATION, in preparation forcommercializing this technology.

Plant for the separation of metals
from waste incineration ash

Cement company

Metals collected
Gold, Silver, and Copper
Sediment Sludge (Mix metals)

Nonferrous smelting company

Sustainability Report 201916

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Resource Circulation Business

Recycling of lithium-ion batteries

Minor metals such as nickel and cobalt are known as the “vitamins
of industry” because these metal materials are indispensable to thehigh-tech and electronic industries. However, the depletion ofmaterials is now causing great concern because the expansion of
relevant industries has been increasing the demand for minor metals.
VOLTA Inc. focused its attention on particularly the inputs oflithium-ion batteries, and is currently engaged in the recycling ofminor metals (cobalt, nickel, and lithium) that are used in lithium-ion
batteries. Lithium-ion batteries are widely used in home appliances,such as smartphones and electric cars, and the demand is expected tofurther grow in the future. The company contributes to therealization of a sustainable society, promoting resource circulation
by supplying the collected minor metals back to battery
manufacturers.
In FY2018, the company made a large investment to ensure the safe
discharge of electricity and to create a system for prompt recycling.
Furthermore, it constructed a factory equipped with a unique exhaust
treatment system in order to enhance the safety of residents and theneighborhood environment. We will strive to promote lithium-ion
battery recycling and to improve the recovery rates by further
promoting technological innovation in the future.
* Black sand: a mixture of cobalt, nickel, and others
that is produced by the calcination of lithium-ion
batteries. By smelting Black sand, recycled cobalt andnickel are produced.

Black sandSustainability Report 201917

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Recycling of ASR

Resource Circulation Business

TopicsASR Recycling Business

Dealing with wood waste/materials that are difficult to dispose

KURODA RECYCLE Co., Ltd. is engaged in the recycling
business of Automobile Shredder Residue (ASR), which remains
after end-of-use vehicles are dismantled to remove
chlorofluorocarbons and their parts, such as air bags, doors andengines, and shredded to collect useful metals.
ASR contains metal particles that were not collected during theshredding process. By further separating/pulverizing and kneading
ASR, the company successfully collects the metal particles andrecycles them as materials for cement production, thereby
contributing to improving therecycling rates of scrap cars.
There are only a small number of
ASR recycling facilities nationwide.
Hence, the company’s facility in
Hakodate City, Hokkaido, accepts
ASR Recycling Facility
ASR from outside of Hokkaido.

Demand is expected to increase for disposal of wood waste
generated through demolition of buildings. In light of this, thecompany constructed an additional pulverizing plant to increase thevolume of wood waste to be recycled as fuel chips, etc.
Furthermore, this plant accepts materials that can be neither
shredded nor crushed, such as fishing equipment, which causes
disposal problems for people in the fishing industry. The company
will proactively increase the number of accepted products,
including materials that are difficult to dispose, thereby expanding
the range of products which they can recycle.

Resolution of waste management problems inherent in each
community
The company is located in the seaport town, Hakodate City. It works
on resolving waste management problems inherent in Southern
Hokkaido through the “Comfortable Life Support*” business. In
recent years, it has focused on the management of scrapped vessels,
ranging from small fishing boats that can be transported by truck asthey are, to large-scale fishing vessels that need to be dismantled onsite. In this business, it adopts a bracket contract. Hakodate is also asnowfall area. The company undertakes the preemptive demolition
and removal of houses, backyard sheds, containers, etc. that are
anticipated to collapse due to snowfall.
As described above, the company offers various services in responseto the different needs of customers in local communities, making useof its extensive knowledge and experience related to recycling.
*Comfortable Life Support: a business that addresses a wide range of issues faced by local residents
through, for instance, the disposal of disused articles, the removal and disposal of articles including
large-sized home appliances, and the demolition of vacant houses.

ASR Recycling Facility: Flowchart
Raw materials for fuel production

Metals separated
Light dust
Particle separation

Primary shredding

Air separation

Heavy dust

ASR resource
recovery rate

100%
(FY2018)

Alternative fuel(Materials and fuels for cement production/made from heavy dust)

Eddy current
separation(Waste plastics/wood waste/tatami mats)

Secondary shredding

Shredding
pretreatment

Magnetic separation

Kneading

Ferrous metals

Dismantling of vessels

Alternative fuel(Materials and fuels for cement production/made from light dust)

Fluff fuels
Unsolidified fuels madefrom shredded materials
Before garage removal

After garage removal

Sustainability Report 201918

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Resource Circulation Business

Regional circular and ecological economy through recycling“Syn Eco Plaza Azumino,” a recycling facility for regional circular and ecological economy through recycling“Syn Eco Plaza Azumino,”a recycling facility for regional circular and ecologicaleconomy through recycling
In April 2019, SYN ECO Inc. opened “Syn Eco Plaza Azumino,” arecycling facility for regional circular and ecological economy
through recycling. Under the theme of “solving social issues in thecommunity,” it offers a wide range of services to address the
problems facing local residents using recycling as an entry point.
Recycling of disposed home appliances
Syn Eco Plaza Azumino collects and recycles home appliances (TVs,
air-conditioners, washing machines and refrigerators) disposed in
Azumino City.
Opening of “Comfortable Life Support” help desk
Syn Eco Plaza Azumino operates the “Comfortable Life Support”
help desk for Azumino citizens, responding to the problems they arefacing, including disposal of disused articles.

Permanent installation of collection boxes of reusable materials
Syn Eco Plaza Azumino is engaged in the recycling of materials brought
in by local residents through the “Mottainai BOX” installed in thecompound where they can deposit reusable materials 24 hours a day.

● RE100 Recycling Facility
In July 2019, Syn Eco Plaza Azumino installed a power generating
facility with reused solar panels placed on the roof. Syn Eco Plaza
Azumino obtains 100% of the electricity that it consumes in thefacility from renewable sources, by combining its self-generated“Comfortable Life Support”
to support the comfortable life of local residents
The company undertakes the “Comfortable Life Support” business inthe areas around its offices. It offers a variety of services such as movingof furniture and home appliances, disposal of disused articles, removal/
disposal of large-sized home appliances, arrangement of the belongingsof the deceased by concerned specialists, demolition of vacant houses,
and cleaning of houses, thereby contributing to solving social issues in
the community such as assisting the elderly with waste disposal/housecleanup and addressing vacant house problems. The total number ofcases attended by our Comfortable Life Support teams reached 844 in
FY2018.

solar power with the electricity purchased from an electricity
retailer under the “RE100 Menu.”

Solar panels

Aerial view of “Syn Eco Plaza Azumino”

Sustainability Report 201919

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Resource Circulation Business

Regulatory Sandbox Framework

Collecting resources through “Mottainai BOX”
SYN ECO Inc. has permanently installed a “Mottainai BOX” in the
Chushin region of Nagano where people can leave reusable materials
24 hours a day. It recycles cardboard boxes, newspapers, wastepaper,
used clothes, metals etc. It has collected a total of 5,214 tons ofmaterials since its start.

Aiming to solve such problems, the company obtained approval
from the Ministry of the Environment, the first of this kind underthe “Regulatory Sandbox Framework*,” to install the “Mottainai
BOX” in 13 municipalities across the Chushin region, Nagano. This
is in addition to those that have already been installed in Matsumoto
City and Azumino City. By using IoT to manage the boxes that are
installed across a wide area, the company has efficiently collectedmaterials and improved recycling rates.

*Regulatory Sandbox Framework: This system is aimed at reviewing regulations that potentiallypose difficulties for the commercialization of new technologies, such as IoT, blockchain, or robots,or the realization of new business models such as platform businesses or the sharing economy.
Under the system, business operators who wish to promote new technologies or business models insociety will submit an application and obtain approval from the competent Minister in charge before
conducting a demonstration test. Then, the information and data collected through the demonstration
test will be utilized to review the regulations. (Source: Prime Minister’s Office: Growth Strategy
Portal Site)

33％

Collection BOX management system using IoT

84％
87％

40％

32％
16％

25％

Mottainai BOX

First project approved by the Ministry of the Environment
under the “Regulatory Sandbox Framework”-Demonstrating a next-generation wide-area recycling
system which uses IoTThe company has been undertaking a demonstration project for anext-generation wide-area recycling system which uses IoT, aiming toenhance the utilization of “Mottainai BOX.” The project is approvedby the Minister of the Environment.
While society demands the reduction of CO2 emissions during waste
incineration, a significant proportion of materials disposed byhouseholds, such as wastepaper, used clothes and metals have been
landfilled or incinerated as waste while they could have been
recycled. In addition, although municipalities should reduce theirexpenditure for waste management as the population decreases, theyfind it difficult to reduce related operation costs, labor costs, etc. Thisis because, in principle, each municipality is made responsible for thecollection of household waste in its own jurisdiction, making it
impossible for multiple municipalities to work together in order tobenefit from economies of scale.

25％
100％

93％

8％

Managing collection boxes installed across a wide area with IoT

Identifying the optimal collection route
Resource collection system
Mottainai BOX

Households

Optimalcollection routeacross a wide area Recycling facility

Metalsfor regional circular and ecologicaleconomy through recycling

Ferrous metals
Resource
recoveryNonferrous metals

Used clothes
Paper
Wastepaper
Used clothes

Sustainability Report 201920

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Resource Circulation Business

Remanufacturing (re-production) Business

Material recycling from ASR to plastics
Automobile shredder residue (ASR), which remains at the end of therecycling process, is recycled as solid fuels and materials for cement
production. However, a significant proportion of residue is incinerated
and landfilled due to various problems including the treatment
capacity of recipient companies. ASR contains a large volume ofplastics. Recycling such plastics will have great social significancefrom the viewpoints of promoting ASR recycling as well as thematerial recycling of plastics.
PLA 2 PLA Inc. manufactures plastic granular pellets with a diameterof 5 mm by separating and processing recycled plastics from ASR.
Recycled plastic pellets are currently used as recycled raw materials
for new plastic products such as pallets, which are utilized in the
distribution industry. The company has been engaged in research toexpand the use of recycled plastics in cooperation with an automobile
company, aiming to construct a resource circular model for vehicles(from one car to another car) in the future.
Furthermore, it is working on the development of “bioplastics” bymixing recycled plastic pellets with biomass such as wood powder.
This work is jointly undertaken with ECONECOL Inc. which isengaged in the business to mix plastics using a high-filling high-speed
melting machine, demonstrating the synergy that exists among groupcompanies.

Development of new recycled materials by melting andfusing different materials together
It is still difficult to recycle plastics and carbon fibers, which are
manufactured and disposed in massive quantities. Relevant
recycling technologies have not been well developed and, even if
they are recycled, their use has still been limited. ECONECOL Inc.
has introduced a new technology to mix two different materials
that an ordinary kneader finds difficult to mix such as recycledplastics and Japanese cedar, recycled plastics and carbon fibers,
and recycled plastics and gypsum. It has launched the manufactureof mixtures with the properties of few thermal hysteresis whichcause little damage, and has been collaborating with the
manufacturers of basic materials and molding equipment to expand
the use of recycled raw materials.

● Taking on challenges to manufacture biomass plastics
The high-filling high-speed melting machine that ECONECOL Inc.
has introduced is capable of mixing plastics, etc. with biomass, suchas wood chips, with a biomass content of 50% or more. It has beenverified to have the technical characteristics suitable for the
manufacturing of biomass plastics. The company is currently
engaged in the development of recycled plastics by melting andfusing plastics with various materials. There is enormous potential
for the production of composite recycled plastics.

Gypsum

CFRP*

Biomass

Manufacturing process of composite recycled plastics
ASR Recycled Pellet
Manufacturing Business

ASR(Automobile
shredder residue)

Recycledpellets

PLA 2 PLA Inc.

High-Filling High-Speed
Melting Business
ECONECOL Inc.

Scrap carsComposite recycled plastic
Manufacturing of recycledplastic pellets* CFRP: Carbon fiber reinforced plastic

GypsumCarbon fibers

CoffeeJapanese cedar
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Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Resource Circulation Business

Manufacturing recycled materials from waste rubber

Taking over and advancing technologies

Enhancing safety in the community and ensuring a“joyful” environment for children

TOYO RUBBER CHIP Co., Ltd. founded in the Meiji era, has been
involved in the rubber recycling business since 1942. It makes fulluse of the skills and knowledge it has gained over 80 years to
manufacture products.
Regarding waste tires and offcuts of industrial rubber products asprecious resources, it manufactures rubber powder from thesematerials. This recycled powder is widely used for elastic paving
materials and artificial turf infills, as well as industrial products suchas tires and brake linings. The company is determined to develop
new materials by making use of the technologies that it has
cultivated.

Black rubber mulch, one of the recycled materials, is used for thecushioning of artificial turf for football fields, etc., ensuring the safetyof people who enjoy sports. Furthermore, “Omni rubber RailGuard
panels,” railroad crossing rubber panels, have great elasticity/durability
along with corrosion resistance and a nonskid-surface, thereby helping
to reduce the number of railroad crossing accidents.
Color rubber chips made from synthetic rubber are used for parks,
pavements and the flooring of play equipment as high-quality
cushioning with great elasticity. It is possible to create an original
design, by combining the various colors. Furthermore, they help reduce
the risks that involve fatal injuries caused by stumbling or falling.

Topics“RE100” Rubber Chip Factory
On May 1, 2019, the factory of TOYO RUBBER CHIP Co.,
Ltd. became an “RE100 Factory” where 100% of theelectricity consumed is generated from renewable sources.
The electricity consumed by the factory is purchased fromelectricity retailers under the “RE100 Menu.” Moreover, withthe use of the non-fossil fuel energy certificate with tracking
information, the factory will get prioritized to receive
electricity from the Komiya Solar Power Plant owned by SYNECO Inc., one of our group companies.
As a result, the company has achieved CO2 emission
reductions in the manufacturing process, making it possible toproduce zero emission products.

Rubber recycling process

Remanufacturing

Scrap tires(Offcuts of rubber products
from factories, etc.)

Black rubber mulch

Football field

Railroad crossing rubber panel

Shunsuke Park

Rubber panels for pedestrians

Maebashi Children Park

Kids Pia Ashikaga

Day care center

Kids Park

Synthetic rubber（EPDM）* EPDM: Ethylene
Propylene Diene Rubber

Color rubber chips

Sustainability Report 201922

Contents / Editorial policy

Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Used-cars-related Business

Crossing borders to places where we are needed

3WM Co., Ltd. exports used cars, trucks, heavy machinery and reusable
parts, such as engines, that have been removed from scrap cars fromJapan.

Sales (Units: 100 million yen)
80

2.0

67

Japanese cars are very popular overseas because of their durability.

Ordinary profit (Units: 100 million yen)

60

63

65

61

1.7
1.5

However, in recent years, hybrid cars have been increasing their share in

40

1.0

Japan. As a result, it has become difficult to cope with demand from the

20

0.5

Middle East, Latin America and Africa where gasoline-fueled and diesel-0

fueled cars are in high demand.
Cognizant of this, the company is currently engaged in not only
exporting the products from Japan but also re-exporting to third countries
the reusable parts, such as engines, of cars that were originally exported

2016/6

2019/6

400

5,232

5,000

endeavor, it started the transactions of maintenance parts from used cars

3,000

originating from New Zealand in FY2019, in addition to the UAE. The

0company has also been expanding the number of countries where it

0.0

4,773

4,622

1.2

0.1
2016/62017/62018/6

2019/6

Number of containers holding shipmentsof used car maintenance parts

6,000

4,000

It promotes reuse by circulating resources and delivering reusable

2018/6

Number of used cars shippedfrom Japan as used cars and later scrapped overseas. As part of thisstocks used cars in addition to Japan.

2017/6

1.7

4,093

395
348

350

330

324

2018/6

2019/6300
250

2016/62017/62018/6

2019/60

2016/62017/6

International transactions of used cars and maintenance parts

materials to the people who need them.

(Luxury cars)

Volume of exports in 2018
● Used car maintenance parts

Number of containers● Used cars

Number of cars shipped

Japan

324

Middle East (UAE)

Bangladesh
Thailand Vietnam
Cambodia The Philippines

UgandaKenya(40 feet long)

4,773* Total number of cars, trucks, and heavy machinery shipped from Japan

Trinidad and Tobago

Malaysia
Singapore Indonesia

Exporting to the neighboring countries of Chile
Singapore - Chile

Southeast Asia

LegendUAE - Chile
Japan - Chile

New Zealand
Used cars

Used car maintenance parts

TrucksHeavy machinery

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Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Involvement in the construction of a global recycling system

Global Resource Circulation Business

Amid mounting concerns about the depletion of mineral resources
resulting from rapid global economic growth, the global utilizationand circulation of various resources has become a critical issue in the
global economy. Another key issue is the change in material flow ina global recycling system as a result of the revision to environmental
regulations in China.
Foreign trade department of ECONECOL Inc. is globally engaged in
the transactions of recycled raw materials and resources produced by
the company’s different business segments within the framework of
the Global Resource Circulation Business, contributing toestablishing a recycling system across the world. It is involved in theinternational transactions of palm kernel shells (PKS) and woodpellets, which are renewable energy sources, and a variety of otherresources along with transactions of metal scrap both inside andoutside of Japan, thereby creating the optimal level of resource
circulation across the world.
Ordinary profit (Units: 100 million yen)

Sales (Units: 100 million yen)
250

Loading ferrous scrap in a container

228

218

5.0

4.4

4.3
4.0

200

150

150

158

3.0

100

2.0

50

1.0

0

2016/62017/62018/6

2019/60.0

2.1

2016/62017/6

2.4

2018/6

2019/6

Inside a freighter

Handling volume (Units: 1,000 tons)
600

565

500

585
514

513

400
300
200
100
0

2016/62017/62018/6

2019/6

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Contents / Editorial policy

Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Three Business Components under Global Resource
Circulation Business

Biomass BusinessFerrous Scrap BusinessWe sell ferrous scrap that is collected at ports across Japan to steel
manufacturers (blast/electric furnaces) in Japan and abroad after
ensuring its quality based on the needs of customers. We transportmaterials not only using bulk carriers but also using containers,
focusing on sales targeting small-scale customers and customers inremote areas.

export to Japan as well.

Nonferrous Metal Scrap BusinessAt our resource recovery plant, after shredding and screening
nonferrous metals contained in the various scrap, we separate
nonferrous scrap that is of a quality that meets the needs of major
nonferrous metal smelters and secondary alloy manufacturers, both
inside and outside of Japan. While we primarily supply companies inSouth Korea, China, and Southeast Asia, we are currently pursuingthe development of new markets in Southwest Asia (India, Pakistan,etc.)

TopicsWe have been engaged in the trading of palm kernel shells (PKS),
centering on Southeast Asia since 2017. In July 2019, we started their
PKS has been receiving attention as a renewable energy source anddemand is expected to increase in Japan and beyond. In light of this,we established a stockyard in Indonesia in August 2019, following
the yard in Malaysia. We plan to increase the number of items that
we trade, not only PKS but also wood pellets, new fuels, and others,
as well as expand the area of container yards.

PKS

Wood pellets

Recycling of the retired dedicated aircrafts ofJapanese government
ECONECOL Inc. concluded the purchase and sale agreementof two retired dedicated aircrafts of Japanese government(B747-400) after winning a tender invited by the Air SelfDefense Force in May 2019. They were handed over at
Anchorage Airport in Alaska, USA, at the end of June in thesame year.
The concerned aircraft did not have an airworthiness certificate(equivalent to an inspection certificate for vehicles). Hence,
they were procured from the Air Self-Defense Force as junk
aircraft, not used aircraft, in order to obtain maintenance parts.
They were subsequently sold to a buyer in the U.S.
They were the first dedicated Japanese government aircraft,
beloved by the people as the flagship of Japan over the years.
Cognizant of this, the company has examined the “best way tosell” the aircraft and, subsequently, reused them by giving thema new “life” instead of merely selling them as they were.
Even in the West, there are two different types of companies
involved in recycling of aircrafts: one that trades used aircraft
and another that recycles parts such as disused frames. Thus, weare convinced that ECONECOL Inc. will be one of the very
few companies that can undertake the comprehensive
assessment and purchase of used aircraft without the
involvement of any other companies. Taking advantage of thisenvironment as thefoundation fordeveloping our services,
Econecol Inc. will be
proactively engaged in
the reuse business.

Sustainability Report 201925

Contents / Editorial policy

Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

International transactions of resources
Foreign trade department of ECONECOL Inc. has established trading bases worldwide, centering on Asia, with the aim of promoting the international transactions of resources.

UK➋

Netherlands

Topics

TopicsImporting from Europe, targeting smelters(Netherlands)
Since the Chinese government tightened regulations concerning
waste imports, scrap that contains precious metals, such as
electronic substrates, have become oversupplied across theworld including Europe. Foreign trade department of
ECONECOL Inc. imports this scrap. After accurately
separating and condensing any precious metals such as gold,
silver, and platinum, it sells them to major smelters in Japan.
The company takes the initiative to procure scrap that contains
precious metals from resource recycling companies worldwide,and supports smelting companies in Japan to secure precious
resources. It contributes to promoting global resource
circulation and reducing environmental load. In addition, it isexpected that the company will play a role in controlling theenvironmental pollution caused by wastes that are exported todeveloping countries and inappropriately treated.

Establishment of the PKS Indonesia Stockyard (Indonesia)

South
Korea

Japan

China

PKS can have different properties, depending on the region where it窶冱 produced. It has become possible to meet the demands for PSK
produced in both Malaysia and Indonesia after the yard was established.
Furthermore, the increase in the number of bases has led to an increasein collection volume, contributing to a more stable supply of fuels.
Without delegating responsibility to the local subsidiaries, the company
has undertaken thorough quality control by directly managing the yard.
Making use of the material transportation know-how that the company
has cultivated, it can thoroughly respond tovarious and detailed requests.

TaiwanIndia
Thailand
Vietnam➊➌

Malaysia➎
Singapore➍

Indonesia

Legend* Established in August 2019

Sites
Ferrous metals

Nonferrous metals

Indonesia stockyard➊ Econecol Ho Chi Minh Representative Office➋ Econecol Europe Representative Office (UK) (Established on October 1, 2019)
Plastics

Wastepaper

Biomass fuels➌ Mine Biomass Synergies MALAYSIA (Malaysia)➍ Mine Biomass Synergies INDONESIA (Indonesia)➎ Mine Biomass Synergies SINGAPORE (Singapore)

Sustainability Report 201926

Society

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Resource Circulation Business

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References

Diversity

Welfare Service Business for Persons with
Disabilities
The ENVIPRO Group support persons with disabilities to enhancetheir ability/knowledge/skills so that they will become selfsupporting in society and be able to find a job in which they canfully demonstrate their ability and knowledge.
ASTOCO Inc. conducts training in the recycling factories of agroup company which is situated in the same compounds as its
offices in Matsumoto City and Azumino City. Training offers anenvironment similar to the actual workplace so that persons withdisabilities can easily envision what their future workplace will be
like, and concentrate on the training and tasks without any sense ofanxiety.
ASTOCO also assists those companies that have recruited persons
with disabilities in creating a conducive work environment where
they can continue working. Furthermore, in cooperation withspecialists in related fields, it supports persons who have lostinterest in work despite their employability or who are reclusive.
This endeavor is aimed at encouraging these people to integratethemselves into society as well as to motivate them to work.
Activities to support persons with disabilities to become selfreliant in the local community• Consultations
about persons
who arereclusive/
persons with
pervasive
development
disorder• Consultations
about the use of
welfare services

FamilyPersons withdisabilities• Practical training /Getting a job in thelocal community• Support persons withdisabilities to receive
education/training●Pre-employment Transition Support Business (Bright)
This business offers a day care service program forpersons with disabilities who are looking for a job.
The program provides them with vocational training
and also assists them in finding a job. It targets
people who have the desire to find a job and are aged
between 18 and 64 years old.

C : 50
M: 0
Y : 100
K:0

Work-style
Reform
Support Business(Telecommuting)R : 159
G : 194
B : 56

R : 228
G : 177
B : 59●TelecommutingThis business aims to solve the problems that companies face, suchas how to properly respond to the needs of employees withdisabilities. It supports the creation of awork environment as well as
tasks that are suitable for person with disabilities.

Attending a lecture

ASTOCO Inc. offices ■Bright■Ecommit

Number of people registered (as of the end of June 2019)
Pre-employment transition

57

Type B Business

31

Bright Matsumoto

People who found employment (total)

Telecommuting(July 2018 – end of June 2019)

Company

C:2
M : 37
Y : 86
K:0

This business runs a welfare service program for persons withdisabilities or intractable diseases who have difficulties working under anormal employment contract. The program trains them on knowledge/
skills, and also offers light work as practical training.
It pays wages. One feature of the program is to provide an opportunity
to work according to their abilities or physical conditions regardless of
their age.

Businesses (Pre-employmenttransition, Type B)

ASTOCO● Type B Continuous Employment Support Business(Ecommit)

17

14

Ecommit Azumino
Bright Matsumoto Ekimae Center
Bright Saitama

Bright Musashikosugi
Ecommit Fujinomiya

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Contents / Editorial policy

Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Creation of programs and a work environment that help
employees to continue working
In conjunction with the declining birthrate and aging population, labor
shortages have become an emerging issue in Japan. To sustain ourbusinesses, we must create a work environment where all employees canfully demonstrate their abilities and where their different needs areaccommodated to allow them to continue working. Using this principle,
we have been promoting programs and mechanisms to create a conducive
work environment.

Proportion of employees
who returned to the work
after parental leave100%(FY2018)

Interview Hiroko Tateno, in charge of administration, Bright Innovation Co., Ltd.

Supporting persons with disabilities to find a job and continue
working
Concerning the employment of persons with disabilities, employees, who have Number of employeeswith disabilities acrossdisabilities, and their employers tend to have different perceptions concerning
the grouplabor conditions, work contents, etc., which often results in their resignation. If
employees resign, it is also a loss to the company. Therefore, this is an issue forboth persons with disabilities and their employers.
Our group companies collaborate with each other to create mechanisms and an(as of June 1, 2019)environment where persons with disabilities can continue working.

18

Interview Takashi Ota, SYN ECO Inc. (left) Miho Yoshinami, ASTOCO Inc. (right)

Q1. What did you do before you started working with us?

Q1. What support do you provide on a daily basis?

I was taking care of my children and working as a volunteer. At the same time, I
was looking for a job using the keywords “resolution of social issues” and“conducive work environment.” Then, I came across Bright Innovation.

(SYN ECO) The staff in charge of recruiting persons with disabilities make therounds of the sites where they are working on a daily basis and have regular
discussions with them. By physically meeting with them every day, staff canrecognize any changes in their physical or psychological conditions immediately.
Their working hours and days are decided, taking their physical conditions andpersonal reasons, such as visit to hospital, into consideration.
(ASTOCO) We have regular discussions with persons with disabilities and theirsections. In addition, if we observe any change in the way they greet us when theycome to or leave the office, we talk to them, or sometimes discuss with the SYNECO staff in charge.

Q2. What is your job now?
I am in charge of the overall administration of the company. The company entrusts ENVIPRO withaccounting and personnel management. I am in charge of other day-to-day administration. I am
occasionally involved in tasks related to commissioned projects along with general administration.
Q3. On what occasions do you feel that your office has a conducive work environment?

Q2. Could you elaborate on how the two companies are working together?

My child was once hospitalized for 10 days. During this period, I was allowed to leave the office early
every day not to miss patient visiting hours. Because it is not completely curable, I was wondering “ifI should resign.” However, the company allows me to adjust my working hours or to work at homewhenever the need arises.
There are also some employees who work at home when their children are sick and unable to go toschool/day care center, and some permanent employees have been working shorter working hours
since they were recruited. I think the company has a very conducive work environment. The company
has not only instituted programs but also successfully created an environment in which employees cantake advantage without any hesitation.

(ASTOCO) We share information with SYN ECO at the job interview or practical training about
what they are good at and not good at, and also what considerations are required to work with them.
Especially, we inform them about any issues that they cannot express well verbally, and the gesturesor signals they use to communicate these issues.
(SYN ECO) We always communicate with them based on information we have received from
ASTOCO. Furthermore, when we encounter any problems, working with them, we discuss with
ASTOCO to address such problems together. I feel convinced that a good working environment willbe created if companies and the people supporting persons with disabilities closely align their
viewpoints.

Sustainability Report 201928

Society

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Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Commitment of our staff

Activities to enhance safety in the workplace
Serious accidents at production sites could be fatal and should be prevented at any cost.
Our group has multiple production sites. Each subsidiary company and site implement their own
awareness-raising and labor safety activities reflecting their own conditions and environment.

Q3. By continuously doing this exercise, what do you want the workplace to be like in the future?

The current KYT is focusing on KY in relation to the key operations
out of a series of operations. The degree or significance of the risks
that are predicted in everyday KY varies. We will promote activities
that enhance workers’ sensitivity to risks, leading them to conduct KY
voluntarily.

Interview

Shinya Kobayashi, Nonferrous Metal Section Head, Production Department, ECONECOL Inc.

Q1. What KYT*1 does the Nonferrous Metal Section implement?

We organize a meeting every morning. Prior to the meeting, either that morning or
the previous day before going home, every worker lists five risks on a KY*2 sheet
about the work which they plan to do that day: what are the potential risks and what
are the measures to take. In the meeting, one of the team members presents what
they listed on the sheet to the other members, taking turns each day. After that, thesheets of all the team members are collected and submitted to the team leader or thesection head for confirmation and feedback. If it’s deemed necessary, we hold adiscussion.
If there is any incident we wish to inform the whole company about, we will
announce it at the safety committee which is held every month.
*1. KYT: Risk Prediction Training

Implementation of employee attitude survey
Our group implements an annual employee attitude survey across group companies simultaneously. The
objective of the survey is to create a safe and comfortable office environment where employees can be
actively engaged in their work with a sense of fulfillment under the corporate philosophy of “share theprofit and joy with the people you live with.”
The survey results are compiled by department: Production, Sales, and Administration. Then, they areshared with the management including the presidents of the companies. We strive to enhance thecommitment of employees by developing and implementing improvement plans, and continuously
examining and addressing issues.

Degree ofhappiness*2. KY: Risk Prediction

StressWorkplacesafetyCommunicationin the workplace

PhysicalhealthWorkload

Q2. Have you observed any changes since you started KYT every day?

We paid close attention to industrial safety and instructed our workers to do the same. Nevertheless,there were accidents. By holding KYT every day, we successfully enhance workers’ awareness that“safety comes first.”
In the past, we also analyzed the causes of accidents whenever they occurred using the Why-Why
Analysis method. Analyses revealed that workers had different sensitivities to and perceptions aboutrisks and, accordingly, what they considered to be risks or their measures against risks varied from one
worker to another. Now each worker first assesses the risks individually and then shares them with theother members of their team or the whole section. By listening to them, the other members becomeaware of the risks that they may have overlooked.

Empathy forcorporate culture
and philosophy

Relationshipwith superiors/
subordinates

Improvement

Enhancement of employees’ commitment

Sustainability Report 201929

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Company profile

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Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Renewable energy and CO2 emissions reduction

Society

Promotion of renewable energy towards “RE100”
We, the ENVIPRO Group, have set a goal to source 100%
renewable electricity for all its operations by 2050 and joined“RE100*” in July 2018. We are the first recycling company to join
this initiative in the World.
Our group facility and factory, “Syn Eco Plaza Azumino” and the“factory of TOYO RUBBER CHIP Co., Ltd.,” have become an“RE100 Factory” where 100% of the electricity consumed isgenerated from renewable energy sources. Furthermore, renewableenergy represents 17% of the electricity consumed across the group(as of June 2019). We are steadily implementing projects to increase
the share of renewable energy in order to achieve the 2050 goal.

Promotion of decarbonization through consulting
services
Bright Innovation Co., Ltd., one of our group companies, offers
consulting services to companies on their environmental
management/decaronization strategies. It provides services tosatisfy the needs of customers, starting from an upstream process,such as the formulation/review of an environmental management
plan, to a downstream process, such as the establishment of anenvironmental management system, the development of agreenhouse gas emissions reduction plan and the introduction ofrenewable energy as a solution.

* RE100: a global initiative bringing together companies committed to 100% renewable energy forthe electricity consumed in their businesses.

For example, a Carbon Disclosure Project (CDP) questionnairerequests companies to disclose climate change-related
information: identification and assessment of risks andopportunities in relation to climate change, the management
system, medium-to-long term targets for CO2 emissions
reductions, etc. Bright Innovation Co., Ltd. is engaged in theperformance evaluation of companies as the scoring partner of
CDP. Based on its vast experience in consulting services, it
supports companies with their information disclosure anddecarbonization, including how to fill out survey questionnaires toimprove their rating.

Topics“Syn Eco Plaza Azumino,”a recycling facility for regional circular and ecologicaleconomy through recycling

Proportion of the electricity
generated from renewableenergy sources across the group

Approx. 17％(as of June 2019)

Proportion of renewable energy (%)

Electricity consumption (GWh)

20

19.2

100

18.3
100

10

0

50

0.0

2.9

2017

2018

19.7

2019
(Projection)

2050

(FY)

“Syn Eco Plaza Azumino” (Azumino City, Nagano), a
recycling facility for regional circular and ecological economy
through recycling, is operated by SYN ECO Inc., our groupcompany. It has installed a power generating facility withreused solar panels placed on the roof.
The facility purchases electricity from electricity retailers
under the RE100 menu, and has successfully become an“RE100 Factory.” In the future, in addition to the electricity
purchased, it can use self-generated solar photovoltaic power(PV).
As the secretariat of our group for RE100 promotion, BrightInnovation Co., Ltd. has comprehensively undertaken multiple
tasks, ranging from the development of roadmaps to theintroduction. Applying the know-how that it gained throughthis process, it will offer services to companies that areplanning to reduce CO2 emissions, or to adopt renewableenergy.

Achieved RE100 by combining self-generated PV renewable electricity
with purchased renewable electricity
Facility owner(Capital investment by BrightInnovation Co., Ltd.)

ReusedpanelsSelling excess electricity toan electric company (Feedin Tariff (FIT) scheme)

Self-consumption
Purchase ofelectricity at night /when electricity is
not generated

Purchase ofelectricity for
selfconsumption

Renewable electricity purchase

Power generation business
operator(Bright Innovation Co., Ltd.)Syn Eco Plaza Azumino(RE100 Recycling Facility)

Copyright 2019 Bright Innovation Co., Ltd

Electricity withenvironmental
value (renewable
attribute)

Electricity
retailer

All Rights Reserved

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Resource Circulation Business

Used-cars-related Business

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References

Business foundation / Growth foundation

Corporate governanceWe believe that corporate governance is an important businessfoundation as well as a precondition to strongly promoting goal
achievements. To promptly respond to changes in the economic
environment, we strive to implement both prompt decision-making
along with efficient and transparent management, and tocontinuously improve our corporate value. To this end, we will keep
evolving to verify and operate the management and internal control
systems, and enhance their effectiveness.

Sustainability Committee
In FY2018, we re-verified relations between our business activities
and social issues, and, subsequently, developed a “Sustainability
Strategy” as a strategy to realize the sustainable development ofsociety and our group concurrently. At the same time, we started theoperation of a sustainability committee on an exploratory basis inorder to flexibly and actively discuss and examine the progress andfuture direction of the strategy from a long-term point of view.
The sustainability committee is composed of the full-time directors
and some executive officers of ENVIPRO HOLDINGS Inc. and isconvened once a month. Based on the strategy, the committee
discusses and examines the potential of new businesses, theestablishment of business/growth foundation and synergies across thegroup. Once opinions about the direction and specific plans areconsolidated, they are deliberated at the meeting of the Board of
Directors, etc.

Corporate governance system
General Meeting of Shareholders
Appointment andRemuneration
Committee

Board of Directors

Audit etc. Committee

Internal Control
Committee

Representative Director

Internal Audit
Department

Compliance
Committee
Environmental Safety
Committee
Information Security
Committee

Risk Management Committee

Management Committee

Departments/
Group Companies● Internal Control Committee
The Committee is composed of four subcommittees (Compliance,
Environmental Safety, Information Security, and Risk Management).
It identifies risks, develops measures, and establishes and operates aninternal control system across the group including the organization ofawareness-raising activities.

● Management Committee
The Committee makes decisions on important matters in relation
to the execution of our businesses and the timely disclosure of
information.

● Appointment and Remuneration Committee
The Committee is composed of a total of five members: one
representative director, three outside board members who are
independent officers, and one advisor. It holds preliminary
deliberations on any nomination of candidacy for director (except formembers of the Audit etc. Committee), remunerations, etc. as anadvisory body to the Board of Directors.

Introduction of segments and a scheme to makeofficers responsible for respective group companies
In the past, our business report described all activities under the
singular segment of the “Resource Recycling Business.” However, inorder to develop our implementation strategies by segment and to
facilitate prompt management decision-making in response to
drastically changing economic environment, we have introduced
multiple segments since June 2019: “Resource Circulation Business,”“Global Resource Circulation Business,” and “Used-cars-related
Business”; and “Environmental Management Consulting Business”
and “Welfare Service Business for Persons with Disabilities” underother businesses (refer to page 9). Simultaneously, we introduced a
new scheme whereby the officers of ENVIPRO HOLDINGS Inc. aremade responsible for their respective consolidated subsidiaries inorder to enhance the collaboration between ENVIPRO andsubsidiaries, thereby strengthening the system to promote ourbusinesses. In the future, we will strive to establish the foundations
that allow us to grow continuously. To this end, we will promote thedevolution of power, prompt decision-making, and transparent
management with good governance.

Nurturing corporate culture
We believe that firmly establishing business objectives and values ascorporate culture, and making everyday business activities consistent
with these objectives and values creates the most effective form ofgovernance. They are also essential activities for sustainableenhancement of corporate value. We distribute a management plan to
our employees that clearly describes the corporate philosophy, values,and code of conduct, aiming at nurturing corporate culture. Adopting
the management plan in business activities, we will spread thecorporate philosophy across our organizations and nurture a corporate
culture, thereby establishing the foundations that enable long-termsustainable growth.
Sustainability Report 201931

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Business foundation / Growth foundation

Human resource development

Self-reliant and well-disciplined organization, thetype of person we want to be

Recruitment of the first batch of new graduates(Scheduled to join in April 2021)

Interview

Based on our corporate philosophy, we aim to create a self-reliant
organization that allows every employee to be the manager of theirown work. Although seemingly contradictory, the organization
should also be well-disciplined. To this end, we have defined the“type of person we want to be” as one of the basic concepts thatshould be applied to human resource development. With our aim todevelop human resources based on this concept, we have beenworking to reflect the concept during the recruitment process,internal training, employee evaluations, employee positioning, etc.

We have been primarily undertaking mid-career employment.
However, we have decided to recruit not only career people but also
new graduates because we consider it important to recruit a diverse
range of people to enhance corporate value in the medium- andlong-term. By recruiting new graduates, we will be able to pass on
the corporate culture and invigorate the organization in addition to
optimizing the age composition of our group. We believe that totrain new employees to become leaders or key personnel in the
future will contribute the most to creating the business foundations
that enable us to grow in the medium- and long-term.

Attending the business school

Type of person
we want to be
1. Value
Person who feels empathy for the corporate philosophy (values),
and is sincere and not arrogant
2. Proactive
Person who can think independently, judge on their own
volition, and take action responsibly
Person who can be proactively engaged in enhancing theexpertise in their work
3. Change
Person who can willingly put aside their past experiences andvalues with the attitude of positively embracing change
4. Speed
Person who can promptly decide and act
5. Challenge
Person who can take up challenges, confronting difficult
situations and new things.
6. Teamwork
Person who can produce a greater output by helping others,
getting the best out of others, and lending a hand to others
7. Diversity
Person who can fully demonstrate their own uniqueness, while
accepting the characters and ideas of different people

ENVIPRO business school
We operate the “ENVIPRO Business School” as a business schoolof the group. It’s aimed at improving the skills and expertise that
employees need to carry out their work.
The school offers original training programs every year, targeting
various personnel in senior management positions and job
categories. In FY2018, it ran three courses, namely “NextGeneration Entrepreneurs,” “Managers,” and “Sales
Representatives.” The “Next-Generation Entrepreneurs” and“Managers” courses offered a total of 9 classes and the “Sales
Representatives” course a total of 4 classes. In total, 30 employees
attended.
Training topics included the ability to persuade/express, marketing
philosophy, finance/management accounting, and human resource
development which corresponded to the requirements of respective
job categories. Especially, in the “Next-Generation Entrepreneurs”
course, lecturers who were specialized in their respective fields
conducted training which reflected actual work, such as thedevelopment of next year’s business plan based on financial
statements and the management policy of the company.
The training was attended by employees from different companies
across our group, which helps to nurture a sense of togetherness andto promote collaboration throughout the group.

Shigeto Komatsu, Representative Director/President, SYN ECO Inc.

I attended the “Managers” course in FY2016
and the “Next-Generation Entrepreneurs”
course in FY2018.
I remember I felt a great sense ofcommitment and at the same time felt
extremely tense because I was taking part in the training as therepresentative of my company with many other employees fromdifferent companies, even though we all belonged to the samegroup. I have developed good relationships with the trainees I met
on the training, which has helped me a lot in my work.
During the training I gained knowledge and a way of thinking thatcannot be acquired in day-to-day work. It gave me an opportunity torevisit my attitude to work and to life.

Attending a lecture

Sustainability Report 201932

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Business foundation / Growth foundation

Growth / Development strategy

Endorsement of the TCFD recommendations
Our group announced its support for the
Task Force on Climate-related Financial
Disclosures (TCFD) recommendations in
May 2019.
The TCFD is a task force established under the Financial Stability
Board (FSB) based on a request from the Ministers of Finance and theEnhancement of work efficiency by introducing
RPA*
In recent years, work-style reform programs have been promoted
and the enhancement of work efficiency has been given a highpriority. If simple tasks are automated, it will become possible forworkers to be engaged in tasks that can be only done by humans,
using the time saved.

Our group has launched the operation of RPA in a survey of new
business partners. RPA is used to collect information needed todecide if a trade connection should be established with a concerned
company. As a result, the workload involved in collecting
information for a company survey has been reduced.
* RPA: Robotic Process Automation
A technology to automate simple tasks and routine tasks.

Governors of Central Banks of the G20. It is a private sector-led
initiative, associated with the disclosure of climate-related financial
information. It has announced recommendations (the TCFD

Interview Toshihiro Koyama, Director, Laboratory, ENVIPRO HOLDINGS Inc.

recommendations) that are aimed at companies to understand anddisclose their financial impacts of climate-related risks andQ2. What are the challenges and prospects
for the laboratory in the future?

opportunities.
According to the TCFD recommendations, we will analyze the risks
and opportunities of climate change on our businesses to integratethem into our business strategies and promote information disclosure
on governance, strategy, risk management, and metrics and targets.

Establishment of a laboratory
To promote resource circulation under the circular economy, we needto have advanced technologies to recycle waste and materials. The
development of core technologies through the assessment of recycling
technologies, analysis of recycled raw materials, accumulation ofdata, and acquisition of technical know-how is essential for thesustainable growth of our group in the future. Cognizant of this, theresearch department of ECONECOL Inc. was reorganized as anorganization directly under ENVIPRO HOLDINGS last year. It now
leads research and development as a laboratory.

Q1. Are there any research themes that are typical for ENVIPRO?
We are currently focusing on launching a business under VOLTA
Inc. which will recover valuable metals, such as cobalt and nickel,
from lithium-ion rechargeable batteries collected from mobile
phones and automobiles. We are jointly engaged with VOLTA Inc.
the establishment of efficient plant operating conditions toconcentrate cobalt, through the introduction of facilities in a metal
recovery plant, planning trial runs and assessments of prototypes. In
addition, we have been continuously engaged in the analysis ofmaterials such as gold and silver sediment sludge assisting
ECONECOL Inc.

We have seconded our researcher to the National Institute forEnvironmental Studies for joint research to develop methods to melt
the metals contained in riddling ash, aiming to grow this field as a
new core business of our group. It is becoming clear that the metalelements themselves determine the types of acid suitable to melt
them and the treatment required after melting. After the secondment
period is completed, we will further work on the commercializationof the research outcome in order to develop this into the next key
business of our company.

Sustainability Report 201933

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

Business foundation / Growth foundation

Challenge to contribute to create a sustainable society

In FY2018, we, the ENVIPRO Group, re-verified relations between ourbusiness activities and social issues, and, subsequently, developed a“Sustainability Strategy” as a growth strategy to realize the sustainable
development of society and our group concurrently.
Until we were listed on the Second Section of the Tokyo Stock
Exchange in September 2013, we prioritized the establishment of ourbusiness foundations. After being listed, we planted a variety of seeds
for future growth with the objective of promoting the diversification of
our businesses. Later, we reviewed the business areas we had
expanded, and decided which businesses to primarily apply our
resources.
Based on this decision, we will further promote the new businesses that
we have already launched and accelerate investments in new growthfields. We will engage ourselves in the development of a sustainable
society as a company which is relied upon by our stakeholders.

Business strategy (expansion of existing businesses,
strengthening of foundations, erecting new pillars)

Synergy between group companies

To realize the above-mentioned policies, we will principally
distribute profits according to the following proportions: 30% forinvestment in growth fields, 10% for research and development,
20-30% for dividends to return to shareholders, 30-40% for internal
reserves.

Making the best use of the human resources, assets, funds,
technologies, and information that the group owns, we will support
the development of the whole group, thereby maximizing the synergy
between our group companies, and expanding and strengthening new
growth foundations across the group.

Profit distribution
Investment in growth fields

30％

Research and development

10％

Return to shareholders

20～30％

Internal reserves

30～40％

Stakeholders
We will strive to win the trust of our stakeholders through ourbusiness activities as well as our communication with them. To thisend, we will regard any concerns expressed by the various
stakeholders (customers, shareholders, business partners, employees,
local communities, administrative offices/industry associations) as
challenges that will lead us to strengthen the business foundation of
our group necessary to promote business activities and sustainablegrowth.

Enhancing corporate value by expanding businesses■ Investment in growth fields■ Actual corporate value

New businesses

Corporate philosophy
Creative Company
Circular Company
Company pursuing virtue

Waste plastics

Waste incineration ash

Corporate value

Lithium-ion batteries

Existing businesses

2020

Resource Circulation, Global Resource Circulation,
Used-cars-related, Environment Management Consulting,Welfare Service for Persons with Disabilities

Synergy between group companies

We will strengthen our growth foundation through developing humanresources, improving corporate governance, brand development andothers, while enhancing our financial stability by continuously
generating profits through expanding existing businesses, technologicalinnovation, improving productivity, etc. Simultaneously, we will erect
new pillars of growth by investing in growth fields and collaboratingwith other companies, thereby enhancing our corporate value.

Profit distribution

Until a business is stabilized, theincrease in corporate value will slow
down because it cannot match theinitial investment. Green areas indicate
a negative balance caused by thiscondition.

2030
Sustainability Report 201934

Contents / Editorial policy

Company profile

Top Message

Sustainability Strategy

Resource Circulation Business

Used-cars-related Business

Global Resource Circulation BusinessSocietyBusiness foundation / Growth foundation

References

References

Materials balance

INPUT

OUTPUT

Raw materials

Products

Resources processed 258,400 tons

Resource recovery rate

Metal scrap

170,200 tons

Wood scrap

3,500 tons

Mixed waste

45,300 tons

Wastepaper

8,600 tons

97.6 ％

Waste plastics

2,300 tons

Used clothes

1,400 tons

CO2 emissions

Scrap cars

9,200 tons

Waste batteries

100 tons

13,000 tons

Electronic waste

5,900 tons

Waste rubber chips

11,900 tons

Ferrous metals

39,600 tons

Wood chips

800 tons

Nonferrous metals

9,900 tons

Raw materials for paper

8,400 tons

Raw materials for plastics

1,200 tons Raw materials from used clothes 900 tons

Raw materials for fuels

29,900 tons Others

Recycled raw materials and used products
for international trading

Resources circulated 404,900 tons
Metal scrap

Recycled raw materials 94,400 tons

350,200 tons

Wastepaper

9,400 tons

Waste plastics

300 tons

Used clothes

400 tons

Scrap cars

5,200 tons

Wood pellets/PKS

39,300 tons

3,700 tons

504,300 tons

Ferrous metals

437,700 tons

Raw materials for fuel39,300 tons

Nonferrous metals

10,900 tons

Raw materials for paper

9,600 tons

Raw materials for plastics

1,500 tons

Used cars/maintenance parts 5,200 tons

Final products 12,300 tons
Rubber chip-based products

EnergyPetroleum-based fuels 58.9TJ

Electricity 18.3GWh

12,300 tons

Water 30,800 m3* Resource recovery rate = Products used for raw materials / (products used for raw
materials + simple incineration + landfilling) x 100

Sustainability Report 201935

Contact for inquiries

ENVIPRO Holdings Inc.
Corporate Plannning Department87-1 Tanaka-cho, Fujinomiya-shi, Shizuoka,
418 - 0075, JAPANTEL: +81-544 -21-3161
URL: https://www.envipro.jp/en/