Hitachi Sustainability Report 2023
Fiscal 2022 Results

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Assurance001

Hitachi Sustainability Report 2023

Contents
Introduction

002

Environmental

025

002 Report Editorial Policy

026 Environmental

003 Hitachi Group Profile

027 Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

004

005 CEO’s Message

027 “Environmental Vision” and“Hitachi Environmental Innovation 2050”
030 Environmental Action Plan
031 Environmental Governance

008 Chief Sustainability Officer’s Message

Back to the contents page
Take you tocorresponding website

XXXXXXXXXXPrevious page
Take you tocorresponding pageP.000 XXXXXXXX

094 Diversity, Equity and Inclusion

150 Addressing Risks and Opportunities
153 Business Continuity Initiatives
155 Information Security
160 Governance Data

011 Sustainability Management032 Environmental Management System161 Business Ethics and Compliance

114 Quality and Customer Satisfaction

035 Achieving a Decarbonized Society013 Materiality035 Efforts to Achieve a DecarbonizedSociety015 Framework for Promoting Sustainability
Strategy036 Contributing to a Decarbonized Society
Through the Decarbonization Business039 Contributing to a Decarbonized Society
at Business Sites (Factories and Offices)021043 Climate-related Financial Information
Disclosure (Based on TCFD
Recommendations)
050 Achieving a Resource-Efficient Society050 Efforts to Achieve a Resource-Efficient
Society051 Building a Society That Uses Resources
Efficiently

000093 Freedom of Association andCollective Bargaining160 Corporate Governance022 Social Innovation Business

Next page

149 Risk Management

108 Responsible Procurement

Social Innovation

Back to the previously viewed page142 Business Ethics and Compliance082 Work-Life Management086 Occupational Health and Safety054 Building a Water-Efficient Society
055 Achieving a Harmonized Society with Nature055 Efforts to Achieve a Harmonized Society
with Nature058 Managing and Reducing Chemical
Substances060 Preserving Ecosystems
061 Environmental Data061 GHG Emissions Throughout the
Value Chain063 Environmental Load from Operations
068 Environmental Management Data069 Environmental Accounting

115 Quality and Product Safety Management
118 Customer Satisfaction
120 Social Contribution Activities
124 Social Data
124 Human Capital132 Responsible Procurement
133 Social Contribution Activities

134

135 Corporate Governance072 Global Human Capital Management

010 Hitachi Group Identity

019 External Assessments and Awards

movement between pages.

071 Human Capital

Governance

102 Human Rights

017 Engagement and Initiatives

Navigation buttons on each page facilitate070

031 Framework for Promoting Environmental
Governance011 Mid-term Management Plan 2024 andSustainability

How to Navigate this ReportSocial

Assurance
162 Assurance

162

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Assurance002

Hitachi Sustainability Report 2023

Introduction

Report Editorial Policy

Report Editorial Policy

Basic Concept

Hitachi Group Profile

The Hitachi Sustainability Report 2023 presents our stance oninternational guidelines, including the disclosure requirements

Hitachi publishes three corporate reports: the Integrated Report,sustainability management, social innovation business, andof the GRI Standards and the industry disclosure standards

the Sustainability Report, and the Annual Securities Report. We

ESG (environment, society, and governance), as well as initia-

relevant to Hitachi as defined by the Sustainable Industry

define each report’s roles by content (from quantitative informa-tives conducted in fiscal 2022 (including initiatives addressing

Classification System (SICS) of the Sustainability Accounting

tion to Value Creation Strategy) and time horizon (from results tomaterialities).

Standards Board (SASB). Our information disclosures related

the mid- to long-term perspective).

GRI 2-2/2-3/2-5

Our Reporting Universe

This report is intended as an engagement tool for all

to climate change are based on the recommendations of the

stakeholders to disclose information in accordance with

Task Force on Climate-related Financial Disclosures (TCFD).

In particular, the Integrated Report and the Sustainability
Report, which are released on the same day, can be read
together to confirm ESG initiative progress and data in addition to management strategies. We also invite you to visit our

What This Report Covers

Companies:

Hitachi, Ltd. and its consolidated subsidiaries

Reportingboundary:

websites for additional information.
Value Creation Strategy

Financial data

964 companies, namely Hitachi, Ltd. and 963 consolidated subsidiaries and equity-method associates and joint
ventures

Environmental
data

697 companies, namely Hitachi, Ltd. and 696 consolidated subsidiaries.
Data on the environmental impact of business activities are for Category A business sites*1 having large environmental loads. Data related information is provided in the notes to each section.

Social and­governance data

Boundary of individual data indicated

Reporting cycle:

Published every year as an annual report

Date published:

September 2023 (Previous report: September 2022)

Integrated ReportMid- to long-term perspective

This report mainly covers fiscal 2022 (April 1, 2022, to March 31, 2023)
Note: Some information on activities in April 2023 and after is also included.

• Corporate Strategy
Briefing Materials

Results

Period:Sustainability Report• Corporate Governance Report• Business Report

Annual Securities Report*1 All Group business sites are classified as A, B, or C (P.032) based on the Criteria for Classification of Environmental Management established by Hitachi. We engage in themost suitable management for each location in accordance with the respective level of environmental risk.

• Financial Results

Quantitative Information

P.032 Environmental Management System

Hitachi References in This Report
Hitachi, Ltd.: Information on or initiatives of Hitachi, Ltd.
Hitachi, Hitachi Group Global: The Hitachi Group including
Hitachi, Ltd.

Key Guidelines• GRI Standards, Global Reporting Initiative
Each section is labeled with GRI topic numbers indicating the corresponding disclosure requirement.
https://www.hitachi.com/sustainability/gri/index.html• Sustainability Accounting Standards, IFRS Foundation
https://www.hitachi.com/sustainability/sasb/index.html• Environmental Reporting Guidelines (2012/2018 version), Ministry of theEnvironment, Japan• Task Force on Climate-related Financial Disclosures

Hitachi Group Profile
https://www.hitachi.com/

Sustainability

Investor Relations
Social Innovation
https://social-innovation.hitachi/en/

Independent Assurance
GRI 2-5

To enhance the credibility of this report, we engaged KPMG
AZSA Sustainability Co., Ltd. to perform a third-party review.
Themark indicates disclosed information assured in­accordance with the International Standard on Assurance
Engagements (ISAE) 3000 and 3410.

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Assurance003

Hitachi Sustainability Report 2023

Introduction

Hitachi Group Profile

Report Editorial Policy

Company Profile (as of March 31, 2023)

Business of the Hitachi Group

Hitachi Group Profile

Corporate name

Hitachi, Ltd.

To become a global leader in the Social Innovation Business, Hitachi has strengthened its

Incorporated

February 1, 1920 (founded in 1910)

business portfolio. The three global trends of Digital, Green, and Connective present remarkable

Head office

1-6-6 Marunouchi, Chiyoda-ku, Tokyo, Japan

Representative

Representative Executive Officer, President & CEO Keiji Kojima

high affinity. The three business sectors work as One Hitachi to solve social issues and achieve

Capital462,817 million yen

sustainable growth with Lumada’s Customer Co-creation Framework.

Number of employees(consolidated)322,525 (Japan: 133,762, outside Japan: 188,763)

Number of consolidated
subsidiaries

696 (Japan: 119, outside Japan: 577)

Number of equity-method
associates and joint ventures

267

GRI 2-1/2-6/2-7/201-1

opportunities for expansion. The core concept of Hitachi’s business sectors—Digital Systems &Services, Green Energy & Mobility and Connective Industries is to align assets with each trend’s

Business Composition*1

5%36%(billion yen)
12,0008,000(billion yen)
1,200

9,480.6
8.0

10,264.6
8,767.2

8,729.1

7.5

6,000

5.7
501.6

10,881.1
1,000

8.3

8.1

7.2

6.9
649.1

583.4

4,000
2,000

7,638.2

2020

2021

■ Revenue (left scale) ■ Net income attributable to Hitachi, Ltd. stockholders (right scale)● Adjusted operating income ratio (%) ● Adjusted EBITA ratio (%)

2022 (FY)

Adj. EBITA

724.8

billion yen

billion yen(FY2022)(FY2022)

600

0

2019

39%

800

87.5
2018

2%
41%

Revenues

200

0Digital Systems &Services

Connective
Industries

400

222.5

Others29%

Connective
Industries

Financial Highlights

10,000Digital Systems &Services

OthersDigital Systems &Services (DSS)Green Energy &Mobility

Green Energy &Mobility

30%

18%Green Energy &Mobility (GEM)

Connective
Industries (CI)

*1 Figures are for the continuing consolidated business (three sectors), excluding Hitachi Metals and Hitachi Construction
Machinery, which were deconsolidated in FY2022, and Hitachi Astemo, which is scheduled to be deconsolidated in FY2023.
The figures on this page are FY2022 results.

Introduction

Management

Social Innovation

Environmental

Management
Report Editorial Policy

Contents
005

CEO’s Message008

Chief Sustainability Officer’s Message010

Hitachi Group Identity

011

Sustainability Management

017

Engagement and Initiatives

019

External Assessments and Awards

Management

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

004

Introduction

Management

Social Innovation

Environmental

SocialGovernanceManagement
CEO’s Message
Chief Sustainability Officer’s Message

CEO’s Message

GRI 2-22

Hitachi’s Social Innovation

Hitachi Group Identity

At Hitachi, we work with our customers towards creating a

Sustainability Management

sustainable society by utilizing data and technology, andEngagement and Initiatives

focus on Social Innovation Business that supports people’squality of life. After experiencing the management crisis inExternal Assessments and Awards

the wake of the Lehman Shock, Hitachi focused on Social
Innovation Business as our single purpose, to solve social
issues together with our customers through unique technologies that combine our strengths in IT, OT, and Products;
and we have since continued to reform our business

Creating a sustainable
society through social
innovation together withstakeholders­portfolio to become a global leader in bringing transformation to society.
Under our Mid-term Management Plan 2024, whichstarted in 2022, we are committed to ensuring sustainablegrowth. To realize a sustainable society, we must expand ourSocial Innovation Business in various fields and create economic, environmental, and social value through three transformation drivers – Digital, Green, and Connective – thathave significant impact on society and industry. For economic value, we aim to achieve growth in Earnings Per Shareand Cash Flow Per Share by increasing the ratio of theLumada*1 business globally, which is a customer co-­creation
framework of a Social Innovation Business that leverages
digital technologies. For environmental value, we aim to contribute to an annual reduction of 100 million metric tons of
CO2 emissions as a Group, through cross-­sector collaboration. As for social value, we will respect the planetary bound-

President & CEO
Hitachi, Ltd.

Keiji Kojima

aries and aim to improve people’s well-being, with Powering
Good as a guiding principle to our activities.

*1 Lumada: Solutions, services, and technologies that leverage Hitachi’s digitaltechnology and are offered to customers to accelerate the digitization ofcustomers’ businesses.

Assurance

Hitachi Sustainability Report 2023

005

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

006

Management
CEO’s Message
Chief Sustainability Officer’s Message
Hitachi Group Identity

Good is like a guiding principle for Hitachi, that I hold dear,

Initiatives for Human Capital Vital toSocial Innovation

Sustainability Management

and which goes hand in hand with the slogan, Inspire the

Securing global human capital is a critical topic for us as we

Engagement and Initiatives

Next. For example, I believe that the rapid evolution of gener-

strive to realize social innovation on a global scale.

External Assessments and Awards

As we shift into a sustainable growth mode, Powering

ative AI will require us humans to improve our ability to dis-

Hitachi has a global network and a strong foundation forcern what is good. As we constantly take actions and takeproviding solutions and products to customers around theon new challenges, and inspire the world through our Socialworld. In recent years, we’ve had the pleasure to welcome

Innovation Business (Inspire the Next) to make progress, wemany new talented people from ABB’s power grids businessmust never forget the ability to tell what is good, or in otherand GlobalLogic through Mergers & Acquisitions (M&A).

words, the guiding principle of Powering Good.

Bringing together the capabilities of this diverse group ofRegarding our approach on “good,” to respect planetary

people with different backgrounds and expertise, and work-boundaries, we have set ourselves a goal to achieve carbon

ing together as One Hitachi, enables us to understand theneutrality across our value chain by fiscal year 2050, underneeds and issues of our customers around the world, and to

the Hitachi Environmental Innovation 2050, a set of long-term

innovate to realize a sustainable society.

environmental targets. We would like to bring value to ourI believe that human capital is the source of Hitachi’s

customers and society through implementing initiatives at ourstrength. In order to provide new value to customers andown business sites (factories and offices) and by significantly

society as One Hitachi and to pursue transformation andgrowing our decarbonization business that contributes to thegrowth, we have set three important goals under the Mid-

reduction of CO2 emissions through collaborative creation

term Management Plan 2024: (1) Acquisition and develop-with our customers and partners.

ment of digital talent; (2) Promotion of Diversity, Equity andAs for well-being, we are committed to influencing andInclusion (DEI); and (3) Increase employee engagement.

contributing towards creating a sustainable society, to ensure

Through our M&A, we have strengthened our digital capabil-

health and wellbeing for all and to sustain a thriving world fority by leveraging on GlobalLogic’s recruitment and develop-

everyone. By making further progress in our internal andment methods, while also broadening our DEI and harnessing

external efforts, it is our vision to support a 100 year lifespan

the diverse talents. In addition, our employee engagement

through innovation.

score has also improved. We aim to achieve even greater
heights, so that our employees will have a growth mindset as
One Hitachi.

Introduction

Management

Social Innovation

Environmental

SocialGovernanceManagement
CEO’s Message
Chief Sustainability Officer’s Message

Evolving Sustainable Management andGovernance that Support Growth

A Message to Stakeholders

Hitachi Group Identity
Sustainability Management

In developing our Mid-term Management Plan 2024, wesocial issues, built together with customers and stakeholders.

Engagement and Initiatives

envisioned how the earth, society, and people living in the

As a company that promotes Social Innovation Business,year 2050 would look like and our aspirations on how we

Hitachi values dialogue and collaboration with a diverse range

want it to look like; taking a back casting approach, weof stakeholders, including customers, shareholders/investors,

identified what we need to do today, as well as what wegovernments, municipalities, academia, and research institu-

need to address in the medium to long term. To promotetions. We receive a great deal of input from young people

sustainable management, we identified six materiality topics

who will lead the next generation in particular, as they are

and set relevant targets against each. Progress against

highly environmentally and health-conscious.

External Assessments and Awards

Hitachi’s more than 110-year history is a series of solving

these targets and new initiatives are discussed in the Senior

These stakeholders are also innovation partners for

Executive Committee and the Board of Directors meetings.

Hitachi with whom we work together to solve social issues.

Evolution of governance is essential to sustainable

Nowadays, many of our customers are taking on the chal-­management. The members of our Board of Directors arelenge of solving social issues. Therefore, I feel like we are inindispensable in bringing important issues to light and wean environment where we can truly engage in Social

had countless discussions in formulating the Mid-term

Innovation Business, and it is very encouraging to see theManagement Plan 2024. We will develop our sustainablebirth of new Social Innovation Businesses as we work dili-management further, through continuous discussions withgently together with our customers to solve social issues.

our Board members under the sustainable growth mode.

To meet our stakeholders’ expectations, Hitachi will con-Also, in order to improve corporate value through moretinue to grow and deliver innovation to our customers aroundrobust sustainability management, we amended the execu-

the world and society, with our diverse team full of talent

tive compensation system in April 2023, and introduced newworking together across business domains and areas ofevaluation criteria on sustainability based on our materiality.

responsibility, with a One Hitachi mindset.

To grow sustainably as a company, we must be recognized
as a sustainable company. It is important that we keep oureyes on the future and contribute to society over the medium
to long term and give back to our stakeholders. The amendment reflects our strong desire to share this intention at the
management level. By implementing such mechanism, we
aim to further advance our sustainable management.

Assurance

Hitachi Sustainability Report 2023

007

Introduction

Management

Social Innovation

Environmental

SocialGovernanceManagement
CEO’s Message

Chief Sustainability Officer’s Message
Hitachi Group Identity
Sustainability Management
Engagement and Initiatives
External Assessments and Awards

Chief Sustainability Officer’s Message

GRI 2-22

Making solid progress toward
our fiscal 2024 sustainability targets
My Mission

Sustainability is Opportunity for Hitachi

The Hitachi Group is a multinational enterprise with a global

Sustainability is not a new concept for Hitachi—it is rooted in

network of operations, an extraordinarily wide range of prod-

the Company’s corporate philosophy and identity. Sustainability

ucts, and a century of know-how and capabilities spanningis also a central element of our Mid-term Management Plan

many different industries. As Chief Sustainability Officer, my2024, which focuses on sustainable growth while respecting

overarching mission is to leverage and align these strengths inplanetary boundaries and enhancing people’s wellbeing. The

ways that enable the Group to effectively tackle the big issues

key to the realization of the plan is our Social Innovation

confronting the world today.

Business and to offer practical solutions for environmental and

I am responsible for assessing the Group’s impact on theenvironment and society and making decisions on appropriate

societal issues that impact the sustainability of our planet.
Today, customers increasingly want to work with compa-

actions to take, to make sure to meet the needs of the present

nies that are committed to sustainability rather than purely

without compromising the ability of future generations to meetfinancial performance. Investors, too, are using environmental,

their own needs. However, to successfully implement thesesocial and corporate governance (ESG) criteria when choosing

actions, the Group will need to transform on a deep, structural

where to put their money. Young people especially, prefer tolevel. Therefore, part of my job is to firmly integrate sustainabil-work for companies that have a broader purpose. We see

ity into our business models, operations, and decision-making.

these trends as opportunities for Hitachi to attract customers,

People are the critical element of this transformation, ofinvestors and talent, and to contribute to sustainable economic

course, so leadership and engagement are vital to encourage

growth in every country where we operate.

all members of the Group to be part of this journey.

Lorena Dellagiovanna
Senior Vice President and Executive Officer,
Chief Sustainability Officer,
General Manager of Sustainability Group, and CDEIO
Hitachi, Ltd.

Assurance

Hitachi Sustainability Report 2023

008

Introduction

Management
CEO’s Message

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

009

Progress of Materiality and Sustainability

we have been able to grow and will continue to strengthen

Hitachi has been selected for various ESG indices and was

To demonstrate Hitachi’s strong commitment to sustainability

our digital capabilities.

ranked as a “leader” (AA) in the MSCI ESG Ratings in 2023.

with transparency, we worked closely with various stake­

DEI is also at the core of our sustainability strategy, and we

MSCI gave Hitachi high marks for its sustainability initiatives,
such as compliance training and disclosure of R&D invest-

holders, NGOs, and other external organizations and identified

will drive our efforts to strengthen sustainability management

Chief Sustainability Officer’s Message

six issues that are critical for the Group’s future—namely: thegoing forward. For example, we have been strengthening

ments to create green value. In addition, in 2022, Hitachi was

Hitachi Group Identity

environment; resilience; safety and security; quality of life;

diversity in our senior management layer and this is indicatedselected as a CDP A list company (the highest rating) in the

Sustainability Management­business with integrity; and diversity, equity and inclusion (DEI).

by the percentages of female and non-Japanese executive

areas of Climate Change and Water Security. Moreover,In this process, we examined current and prospective businessand corporate officers. In fiscal 2022, women and non-­

Hitachi also received CDP’s Supplier Engagement Leader

opportunities and assessed impacts for stakeholders.

Japanese nationals appointed to these positions reached(the highest rating for supplier engagement) for its efforts toEngagement and Initiatives
External Assessments and Awards

Thanks to the dedicated efforts of the Group’s employees
around the world, we have been making steady progress
toward achieving the targets. On our decarbonization efforts,

11% and 20% respectively, making headway toward ourachieve a net-zero society, including reductions in CO2 emis-­targets of 30% by fiscal 2030.

sions throughout its value chain, and we are very proud ofMore importantly, however, we have been making diversity

these achievements.

for example, we are aiming to achieve carbon neutrality within

an integral part of our workplace by giving every member an

our business sites by fiscal 2030. Our target for the current

active role to play. Reflecting this approach, our employee

Message to Stakeholders

Mid-term Management Plan is to reduce this by 50% against

engagement score in fiscal 2022 surpassed the target we set

While the Hitachi Group is a vast global enterprise with leading-­

the base year of 2010 by fiscal 2024, and our current projection

for fiscal 2024. Diversity can generate new ideas, but foredge technologies and expertise, given the scale of the prob-

shows that we are expecting to reach 64% of CO2 ­emission

people to have a platform for voicing those ideas and creatinglems facing the world today, we understand the necessity for

reductions. On the other hand, we are also working with oursolutions, measures must also be in place to ensure equity

external collaboration. Therefore, we are actively seeking out

customers to reduce the society’s CO2 emissions throughand inclusion. In other words, the interplay between all threeopportunities to work with governments, academia, organiza-

Social Innovation Business. In fiscal 2022, we were able tocomponents of DEI is the key to unlocking innovation and thetions, and companies, including customers, suppliers, and evencontribute to approximately 126 million metric tons of avoided

potential of human capital.

our competitors. Our sustainability initiatives are directly related

As a group-wide voluntary initiative, our Hitachi Voice ofto 13 of the UN Sustainable Development Goals, but we intend

Youth Programme provides opportunities for young employees

to contribute to the achievement of all 17 goals by expanding

target of reduction rate in water use per unit by 24%, by fiscal

to talk about sustainability with peers across different busi-

our activities through these partnerships.

2024 compared with the base year 2010. As part of ournesses, regions, and with our leadership team. I have had

efforts to promote a circular economy, we’re also aiming tonumerous conversations with the participants, and I am very

virtually eliminate waste sent to landfill by fiscal 2030 and

excited about how these young people are bringing new

apply eco-design to all newly developed products by fiscalenergy and passion to the Group from the bottom up.

emissions against our target of 100 million metric tons.
On circular economy, we are on track to achieve our2024. Hitachi registered 357 new products using thisI believe that Hitachi will have a greater opportunity toapproach in fiscal 2022, which will significantly reduce therapidly evolve by leveraging its collective capabilities, know-

environmental impact throughout the product life cycle.

how, technologies, and diversity in ways that provide valuable

Turning to human capital, we set ourselves the target ofsolutions for people throughout society. By having all ourincreasing our digital talent to 97,000 people group-wide bybusinesses around the world join forces as One Hitachi, every

fiscal 2024 (excluding Hitachi Astemo), recognizing that digital

member of the Group can play an active and a vital role andcapabilities are not only important to the Hitachi Group but

make a difference.

for society in general. Thanks to Hitachi’s acquisition of
GlobalLogic, a leading digital engineering services company,

Lastly, we regard external evaluations as important­feedback for strengthening sustainability management.

I look forward to working alongside our stakeholders as
we pursue this ambitious endeavor in the years ahead.

Introduction

Management
CEO’s Message
Chief Sustainability Officer’s Message

Hitachi Group Identity
Sustainability Management
Engagement and Initiatives
External Assessments and Awards

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

010

Hitachi Group Identity
Carrying out Corporate Activities Based on the Hitachi Group Identity

Solidifying the Hitachi Group Identity
GRI 2-23

Approach

Training

Since our founding, Hitachi has been working to solve thedifferent cultures, we must cherish Harmony, Sincerity and

Hitachi offers awareness activities through training tools andchallenges facing society by following our MISSION:

Pioneering Spirit.

courses, assuming that social issues can be solved if eachContribute to society through the development of superior,

Hitachi businesses solve social challenges and supports

original technology and products. Our VALUES, present insustainability. Moving forward, it is essential that all employees

the Hitachi Founding Spirit and reflecting Harmony, Sincerity,

around the world, despite their different language and think-

ity with the Hitachi Group Identity and the Hitachi Brand is

and Pioneering Spirit, guide our mission and inspire ouring, continue to engage in constructive discussion. As wewith the annual Inspiration of the Year Global Awards. These

actions. The MISSION and VALUES are our foundation, andpursue our goal of contributing to society, we must maintainawards recognize remarkable activities that contribute to

together with the addition of the Hitachi Group Vision of thecommon Hitachi VALUES across the Group.

enhancing the value of the Hitachi Brand by building on theemployee understands and practices the Hitachi Group Identity.
One way we encourage an understanding of and familiar-

company’s future, we define the Hitachi Group Identity.

With the Hitachi Group Identity as our foundation, we willAs the Group continues to grow globally, Hitachi had

grow as individuals and as an organization. Together with our

cations from Hitachi Group employees around the world.

reached approximately 320,000 employees on a consolidated

colleagues worldwide, we will contribute to society throughThese submissions included a project to interconnect renew-

basis in fiscal 2022, about 60% of whom working outside

our Social Innovation Business.

able energy across regions and another for environmentally

Japan. Similarly, sales revenue generated in non-­Japanesemarkets account for about 60% of total revenue. In this age ofworking together with employees from different countries with

Hitachi Group Identity. In fiscal 2022, we received 298 appli-friendly railway vehicles that reduce local traffic congestion
Hitachi Group Identity
https://www.hitachi.com/corporate/about/identity/index.html

and air pollution. We selected projects that use technology toachieve sustainability and improve well-being in each region
to compete for the Grand Prix. The Grand Prix-winning projects were recognized at the Global Awards Ceremony and

Hitachi Group Identity

shared with all employees through our intranet.
We published the Hitachi Group Identity Movie - I am
Hitachi, a movie featuring the award winners, on our website, allowing a wide range of people inside and outside the
The mission that Hitachi
aspires to fulfill in society

The values crucial to
the Hitachi Group inaccomplishing its mission

What the Hitachi Groupaims to becomein the future

MISSION

VALUESVISION

Contribute to society through the development ofsuperior, original technology and products.

Hitachi Founding Spirit:
Harmony, Sincerity, Pioneering Spirit

Hitachi delivers innovations that answer
society’s challenges. With our talented
team and proven experience in global
markets, we can inspire the world.

Group to see how Hitachi Group employees around theworld endeavor to create better societies.
Hitachi Group Identity Movie - I am Hitachi https://www.hitachi.com/corporate/about/identity/i_am_hitachi/index.html

Management

Introduction

Social Innovation

Environmental

SocialManagement

Sustainability Management

CEO’s Message

Mid-term Management Plan 2024 and Sustainability

Governance

Assurance

Hitachi Sustainability Report 2023

011

Chief Sustainability Officer’s Message
Hitachi Group Identity

Sustainability Management
	Mid-term Management Plan 2024 andSustainability
Materiality
Framework for Promoting Sustainability Strategy

Towards Sustainable Societies—Mid-term Management Plan 2024
Approach

Strategy

Targets

In accordance with Hitachi’s Mission to “contribute to society

Vision Targets of Mid-term Management Plan 2024

through the development of superior, original technology and

Hitachi continues to grow across diverse industries and solve

issues through its business, while respecting planetaryproducts,” we pursue our Social Innovation Business leverag-social issues through the three global trends of Digital, Green,boundaries and realizing wellbeing for all individuals. We willing core strengths in IT (Information Technology) × OT

and Connective as change drivers.

further evolve our Social Innovation Business driven by three

Engagement and Initiatives(Operational Technology) × Products, and Lumada* to help

External Assessments and Awards

build sustainable societies.

Hitachi aims to resolve the increasingly complex social

The environment is reaching limits on a global scale as

growth drivers: Digital, Green, and Innovation, and contributethe thresholds of several of the nine planetary boundaries

to solve social issues. We will also grow Lumada globally as

have already been crossed. Also, wellbeing (physical, mental,

a customer co-creation framework, accelerating expansion

recent years, it is essential that we conduct management

and social) is a growing global issue, therefore it is significant

through four cross-organizational functions: Green, Digital,from a long-term perspective and maximize Hitachi’s diversethat we focus both on planetary boundaries and wellbeing.

Innovation, and Global M&S.

1

To respond to the increasingly complex global issues ofmanagement resources to achieve further evolution in ourSocial Innovation Business.
Hitachi has responded by imagining the future—what theSupporting quality of life with data and technology that foster a sustainable society

earth, society, and people will look like and what Hitachi will

Growthact like in 2050. Based on the future, in April 2022, we backcasted to formulate the Mid-term Management Plan 2024

ion for So
reat
cie
-C
ty
o
C

which clarified what Hitachi should do now and what Hitachi
should achieve over the medium- to long term.
*1 Lumada: Solutions, services, and technologies that leverage Hitachi’s digitaltechnology and are offered to customers to accelerate the digitization ofcustomers’ businesses.

Mid-term Management Plan 2024

Planetary
Boundaries
Protect the earth while
maintaining social
infrastructure

Society
Progress of the Mid-term Management Plan 2024

Green

Wellbeing

DigitalA society where every
individual is comfortable
and active

Innovation

PeopleIntroduction

Management

Management

Social Innovation

Environmental

SocialGovernanceContributing to the SDGs
ApproachCEO’s Message

Hitachi’s Social Innovation Business aims to create sustainable

examined the relationship between the opportunities and risks

Chief Sustainability Officer’s Message

societies by solving global social and environmental issues asassociated with the SDGs and our businesses to identify 13

Hitachi Group Identity

defined by the SDGs, and we consider the business to be agoals as Hitachi priority SDGs issues: five goals through which

Sustainability Management

source of sustainable growth for us. We strive to create social,

we make particularly significant impacts through our key busi-

environmental, and economic value through our Social

nesses and six goals through which we particularly contribute

Innovation Business, reduce negative social and environmental

in the course of our corporate activities.

	Mid-term Management Plan 2024 andSustainability
Materiality
Framework for Promoting Sustainability Strategy
Engagement and Initiatives

impacts and seek a deeper understanding of business risks

Through our active involvement across a broad range ofarising from social and environmental changes to ensure busi-

business fields, we believe we can contribute extensively toness continuity and greater resilience.

the achievement of SDGs beyond the 13 goals identified, andBased on our Mid-term Management Plan 2024, we

we will strive to contribute to the achievement of all 17 SDGs.

External Assessments and Awards

Business Strategy

Corporate Commitment

Assurance

Hitachi Sustainability Report 2023

012

Management
CEO’s Message
Chief Sustainability Officer’s Message
Hitachi Group Identity

Sustainability Management
Mid-term Management Plan 2024 andSustainability	Materiality
Framework for Promoting Sustainability Strategy
Engagement and Initiatives
External Assessments and Awards

Introduction

Management

Materiality

GRI 2-4/2-14/2-16

Social Innovation

Environmental

SocialGovernance

Assurance

Toward a Sustainable Society: Hitachi’s Materiality
Approach

Strategysustainability as the core of its business strategy, and is working toward realizing a sustainable society through the Social
Innovation Business.
In the Mid-term Management Plan 2024, we declared ouraspiration of “supporting people’s quality of life with data andtechnology that fosters a sustainable society.” While some of
the nine planetary boundaries have already been exceeded,
Hitachi is aware of each one and works to protect the planet
and maintain society. Hitachi aims to solve social challenges
to realize a future that balances protection of the planet and

STI

GRI 3-1
Company-wide
performance

Materiality analysis process
STEP1

Comprehensive understanding ofsocial issues

STEP2

Ranking issues by priority from
Hitachi’s point of view

STEP3

Ranking issues by priority from astakeholders’ point of view

STEP4

Identifying Materiality

Planetary boundaries

The materiality analysis process

Individual
evaluation
Sustainability targets included
in individual targets

After amendment
STI
Company-wide
performance

Divisional
performance<Performance indexes>
E.g., revenues, Lumada business revenues,
Adj. EBITA Margin, EPS, core FCF

Materiality analysis process
https://www.hitachi.com/sustainability/materiality/

Reflecting Sustainability Targets in Executive
Compensation Evaluation
SystemDivisional
performance<Performance indexes>
E.g., revenues, adjusted operating income,
EBIT, income before taxes, net income,
operating income ratio

people’s individual wellbeing.
https://social-innovation.hitachi/en/article/planetary-boundaries/

GRI 2-19

Individual
evaluation

Sustainability

New evaluations based on
our Materiality “Environment”“Business with Integrity” and “Quality of Life”
based on the sustainability strategy

Quality of Life, each linked to sub-materiality topics targets
listed below.
Going forward, Hitachi will enhance link of compensationand the growth of the company, cultivating a growth mindset
and strive to achieve global growth as One Hitachi.

With a comprehensive understanding of social issues, Hitachi

In fiscal 2023, Hitachi amended the executive compensation

has identified six material topics and 15 sub-material topics

system to further accelerate growth as a global company, andbased on an analysis of risks and opportunities from a sus-

to further strengthen links between increases in corporate

Materiality targets linked to executive compensation

tainability perspectives as well as feedback from stakeholders.

value and compensation. The revised executive compensation

Materiality

Based on these material topics, Hitachi is monitoring

system is more closely linked to the Mid-term Management

measures as well as discussing the progress, and new initiatives for each materiality at the Senior Executive Committee
and the Board of Directors.

013

Before amendment

Targets

Hitachi practices sustainable management, which positions

Hitachi Sustainability Report 2023

Environment[Decarbonization]• Carbon neutrality through the value chain• Contributing to CO2 reduction through business[Resource circulation]• Effective use of water

Business with
Integrity[Occupational safety]• Creating a safe working environment without accidents

Quality of Life

[Employee happiness]• More flexible working styles to increase engagement

Plan 2024 and incorporates sustainability targets.
Specifically, sustainability evaluations that had been used as
an index for individual short-term incentive compensation (STI)
are now treated separately and account for a ratio of 20%.
In addition, an additional grant of shares equivalent to
10% of the standard amount of medium- to long-term incentive compensation (LTI) will be granted if the sustainability
targets are achieved.
Sustainability evaluation in STI will be aligned to materiality
topics including Environment, Business with Integrity andSub-material topics target

P.141 Compensation to Executive Officers

Introduction

Management
CEO’s Message
Chief Sustainability Officer’s Message
Hitachi Group Identity

Management

Social Innovation

15 Sub-Material Topics and Targets
Materiality

	Materiality
Framework for Promoting Sustainability Strategy

External Assessments and Awards

Resilience
Contributing to the maintenance and rapid
recovery of social infrastructure

Safety & Security
Contributing to safe and securesociety-building

Quality of Life
Contributing to physical and mental wellness
and a prosperous life

Business with Integrity
Adhering to ethical standards as well as
respect human rights

Diversity, Equity and Inclusion (DEI)
Contributing to a society where everyone canshine

Hitachi helps people live safely by contributing
to the rapid recovery of supply chains and themaintenance of social infrastructure by providing system solutions that can respond immediately to risks, such as natural disasters,
pandemics, and cyberattacks.
Hitachi contributes to the realization of comfortable and active lifestyles for people by providing
solutions in the building, mobility, and security
fields that support urban development for safe
and secure living.
Hitachi is harnessing our healthcare and digitaltechnologies to help more people develop
bonds and enjoy healthier, more prosperous
lives. We will also continue to pursue thehappiness and wellbeing of our employees, as
we believe that their happiness and wellbeingis the ground on which Hitachi’s future will
flourish even more fully.
As a Group responsible for social infrastructurearound the world, Hitachi will manage its
business with honesty and integrity, trusted bysociety, respect human rights and provide asafe workplace. We will reflect a system of
ethical and responsible business conduct,
including respect for human rights, in ourbusiness activities and decision-making
standards, working together with our employees, collaborative partners and communities
throughout the supply chain.
Hitachi has a place for everyone, welcoming
differences in colleagues’ background, age,gender, sexuality, family status, disability, race,
nationality, ethnicity, and religion. At Hitachi, we
treat everyone fairly, recognizing differences toallow everyone to perform at their full potential.
We respect and value these and other differences because only through them we canunderstand our markets, create better ideas
and drive innovation.

Governance

Assurance

Hitachi Sustainability Report 2023

014

GRI 3-2/3-3

Sub-material topics Targets/KPIs

Decarbonization
As a climate change innovator, Hitachi willcontribute to the realization of a carbon neutral
society with Hitachi's superior green technologies, by providing value to customers in all
business segments. We will also promoteresource efficiency toward the transition to acircular economy.

Mid-term Management Plan 2024 andSustainability

Social

Our aspirations

Environment
Contributing to decarbonization and resource
circulation

Sustainability Management

Engagement and Initiatives

Environmental

Resource circulation

Carbon neutrality through the value chain
Targets/KPIs • FY2030: Achieve carbon neutrality in business sites (factories and offices)• FY2050: Achieve carbon neutrality through the value chain
Contributing to CO2 reduction through business
Target/KPI • FY2024: 100 million metric tons of CO2 avoided emissions per year
Transition to a circular economy
Targets/KPIs • FY2024: Full application Eco-Design for all newly developed products• FY2030: Zero*2 waste to landfill*3 from manufacturing sites
Effective use of water
Target/KPI • Reduction rate in water use per unit (compared to FY2010)
FY2024: 24%, FY2050: 50%

Harmonize with nature

Minimize impact on natural capitalStrengthening supply
chainsBuild flexible supply chains capable of responding to disasters and risks

Maintaining social
infrastructure

Resilience and sophistication of maintenance through DX of social infrastructure
Business Case Contribute to stable energy supply through substation management to approx.
1.9 billion people*4

Safe and secure urban
environments

Safe and comfortable transportation
Business Case Contributed to a total of 15 billion people annually through railway services*4

Ensuring cyber security

Secure cybersecurity for social infrastructure and business systems

Connected andprosperous society

Employee happinessBusiness ethics andcompliance

Respect for humanrightsOccupational safety
Safe and secure
products and services
Diverse organizationthat fosters innovation

Contribution to adiverse and equitablesociety

FY2022 Progress
40% of total CO2 reduction rate at factories andoffices (compared to FY2010)
126.1 million metric tons per year*1 of CO2 avoided
emissions357 products identified as subject of Eco-Design
199 sites (58%) achieved zero waste to landfill
27% reduction in water use per unit
Sustainability Report 2023
P.55–57

Sustainability Report 2023
P.22–24

Increase healthy life expectancy and wellbeing
Business Case Blood tests and other physical exams: 20 billion tests/year*4
Build a trustful relationship with others
Target/KPI • Users of happiness service: 90 thousand in FY2024

10.0 thousand users of happiness service

More flexible working styles to increase engagement
Target/KPI • Employee engagement (positive response rate): FY2024 71.0%*5

69.5% employee engagement (positive response rate)

Encourage employees to apply ethical standards in day-to-day work.
Target/KPI • Achieve a score of at least 60 (out of 100) in FY2023*6, the first year of resultsfrom Ethical Culture & Perceptions Assessment, improving it every year
Promote human rights due diligence and strengthen monitoring of procurement partners forresponsible procurement, including human rights
Targets/KPIs	• FY2023: Conduct human rights risk assessments for all BUs (10 BUs) and majorGroup companies• FY2024: Respond to human rights risks
Creating a safe working environment without accidents
Target/KPI • Zero fatal accidents

Achieved a score of 76.5 (Conducted assessment inJune 2023)

Conducted human rights risk assessments forcertain Group companies

5 fatal accidents

Ensure products and services safety while putting customers first

Sustainability Report 2023
P.115–117

Strengthen diversity in management
Target/KPI • Ratio of female and non-Japanese executive and corporate officers: FY2030 30%
respectively

11% of female and 20% of non-Japanese executive
and corporate officers*7

Acquiring and developing digital talent
Target/KPI • FY2024: 97,000 persons*8

83,000 persons

Empower DEI of society through community relationship programs
Target/KPI• Nurture and empower next-generation talentParticipants in Hitachi Young Leaders Initiative
30 people 405 people cumulative*9Participants in Hitachi High-Tech science education
support activities
62,487 people 367,362 people cumulative*10*1: Mid-term Management Plan 2024 three-year average *2: Less than 0.5% *3: Wherever this is compatible with local conditions and regulations *4: FY2022 results *5: Target has been raised since we achieved the initial target/KPI*6: Base year has been changed from FY2022 to FY2023 *7: Included assignment as of April 1, 2023 *8: Hitachi Astemo is excluded *9: Cumulative total since 1996 *10: Cumulative total since 1990

Introduction

Management
CEO’s Message
Chief Sustainability Officer’s Message
Hitachi Group Identity

Sustainability Management
Mid-term Management Plan 2024 andSustainability
Materiality	Framework for Promoting Sustainability
Strategy
Engagement and Initiatives
External Assessments and Awards

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

015

Framework for Promoting Sustainability Strategy
Establish a System to Promote Sustainability
GRI 2-12/2-13/2-14/2-16/2-24

Structure

Hitachi pursues sustainability initiatives across the group under

Individual sustainability themes such as carbon neutrality, circular economy, human rights due diligence (HRDD), diversity, equity,

the leadership of Chief Sustainability Officer, Lorena Dellagiovanna.

and inclusion (DEI), occupational safety and health, supply chains, quality assurance, etc. are promoted by meeting bodies consist-

In April 2022, Hitachi established the Growth Strategy

ing of responsible staff at BUs and principal Group companies as part of cross-organizational activities in the Hitachi Group, who

Meeting, Risk Management Meeting, and Human Resource
Strategy Meeting to deliberate on the following important
issues within the Senior Executive Committee that discusses

discuss measures and share information across the entire Group.
Since fiscal 2022, we hold the Sustainability Promotion Meetings chaired by the Chief Sustainability Officer to discuss and share
information on important measures related to sustainability across the group, aiming to deepen sustainable management further.

important topics in Hitachi’s corporate management.
Growth Strategy Meeting: Matters related to management strategies
for the growth of the Hitachi Group
Risk Management Meeting: Matters necessary for the proper
management of risk in the Hitachi Group
Human Capital Strategy Meeting: Matters necessary for establishing organization and culture, and securing and developing humancapital for the growth of the Hitachi Group

Framework for promoting sustainability strategy
Board of Directors
Senior Executive Committee
Growth Strategy Meeting

Human Resource
Strategy Meeting

The Growth Strategy Meeting discusses and decides on matters

Risk Management Meeting

Sustainability
Promotion Meeting

related to the Hitachi Group’s management strategy and accelerates the formulation of strategies necessary for its growth.
The Risk Management Meeting discusses and decides onimportant matters related to group-wide risks, and aims torealize a solid management foundation in coordination withEnvironmental

Social

Eco-Management Meeting

growth strategies through a centralized and cross-sectional
understanding of risks.
The Human Resource Strategy Meeting discusses anddecides on matters necessary to foster the Hitachi Group’s
organization and culture as well as to secure and develop
human resources, thereby supporting its further growth throughCircular Economy (CE)

Carbon Neutrality (CN)Eco-Management
3R Promotion
Project Meeting

Eco-Management
CN2030 Promotion
Project Meetingthe enhancement of human capital.
After discussions at these meeting bodies, important sustainability issues are deliberated on by the Senior Executive
Committee to make decisions, and are submitted to the Boardof Directors for further discussions as necessary.

Human Rights

DEI

HRDD Execution
Managers Meeting

Global DEI Council

Occupational Healthand Safety

Quality Assurance

Health and Safety
Leaders Meeting

QA Division-Manager
Liaison Meeting

Sustainable Procurement
Sustainable Procurement ConferenceIntroduction

Management
CEO’s Message

Management

Social Innovation

Framework for Implementing the
Hitachi GX Strategy
Aiming to be a global leader in green transformation (GX),
Hitachi formulated a Green Strategy consisting of GX for
CORE and GX for GROWTH, striving to put into place a

Hitachi Group Identity

framework to execute our strategy.

Mid-term Management Plan 2024 andSustainability
Materiality	Framework for Promoting Sustainability
Strategy
Engagement and Initiatives

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

016

Framework for implementing GX strategy

Chief Sustainability Officer’s Message

Sustainability Management

Environmental

Board of Directors

Senior Executive Committee

The Internal Environment Initiatives Division leads environ-

Digital Strategy

mental activities within the Hitachi Group. At the same time,

Green Strategy
Chief Sustainability Officer

Innovation Strategy

the Global Environment Business Group drives growthInternal Environment
Initiatives Division

through green businesses. And the business sectors foster
environmental contributions through their respective business

Global Environment
Business Division

fields by working together to lead green strategies throughout
the group.
Digital Systems & Services

Green Energy & Mobility

Connective Industries

External Assessments and Awards
Overview of Sustainability Related Conference Bodies
Meeting

Attendees

PurposeFrequency

Sustainability Promotion Meeting

Chief Sustainability Officer, Business promotion division heads at BUs & key
Group companies and RHQ Sustainability Officers

Deliberation, information sharing related to material sustainability initiatives

Once or twice
per year

Eco-Management Meeting

Heads of Business promotion/Environment-related/MONOZUKURI (production)/
Procurement divisions from BUs and key Group companies

Deliberation, planning, and implementation of action plans (environmental
action plans) to achieve the Hitachi environmental long-term goals

Twice per year

Eco-Management CN2030 Promotion
Project Meeting

Heads and members of Environment-related/MONOZUKURI (production)
divisions from BUs and key Group companies

Monitoring and implementation of CN action plan and discussion ofacceleration

Twice per year

Eco-Management 3R Promotion
Project Meeting

Heads and members of Environment-related/MONOZUKURI (production)
divisions from BUs and key Group companies

Promotion of actions for 3R activities toward realizing CE

Sustainable Procurement Conference

Chief Procurement Officer, heads of the procurement divisions at BUs and key
Group companies, and individuals responsible for and engaged in sustainableprocurement

Communicate the Hitachi Group sustainable procurement policies and strategies to all procurement divisions, improve knowledge and share best practices

Twice per year

HRDD Execution Managers Meeting

HRDD execution managers from BUs and key Group companies

Provide information and knowledge necessary for HRDD implementation, andshare status of implementation in BUs and key Group companies

Once or twice
per year

Global DEI Council

DEI leaders from BUs and key Group companies

Implement DEI policies, initiatives and share best practices

Once or twice
per year

Health and Safety Leaders Meeting

Individuals responsible for health and safety at BUs, key Group companies(CHRO, officer in charge of health and safety)

QA Division-Manager Liaison Meeting

Heads of the quality assurance divisions at BUs and key Group companies

Instruct and communicate occupational health and safety activity policies andmeasures, confirm progress
Share the details of important incidents related to occupational health andsafety, discuss measures to ensure the prevention of recurrence
Discuss and develop shared Hitachi Group quality improvement activity
policies and measures for products and services

Four times
per yearOnce pertwo months

Every quarter

Management

Introduction

Management
CEO’s Message
Chief Sustainability Officer’s Message
Hitachi Group Identity
Sustainability Management

Engagement and Initiatives
External Assessments and Awards

Social Innovation

Engagement and Initiatives

Activities

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

017

GRI 2-28

Stakeholder Engagement
Approach

Environmental

Industry Leadership and Policy Recommendations
GRI 2-29

As part of developing Hitachi’s Social Innovation Business on a global scale, Hitachi views government institutions and privatebodies in each country and region of the world as important partners. Our Government & External Relations Group leads our efforts

In its commitment to promoting the Social Innovation

to strengthen ties with these bodies. We collaborate with business locations worldwide to develop mutual relationships with local

Business, Hitachi endeavors to accurately identify the various

communities, working with governments and international organizations in each country. At the same time, the Group seeks newsocial issues facing each country and region, and to workbusiness opportunities for Hitachi, creating value based on the various regional social issues and policies.

toward resolution of these issues through engagement incollaborative creation with a wide range of stakeholders,
including customers, governments and municipalities, as wellas academic and research institutions. In addition, with theMore frequently, governments are asking for our opinions. We also contribute to building better societies by making requests
directly and proposing solutions through discussions in economic organizations and industrial bodies.
Industry Leadership and Policy Recommendations
http://www.hitachi.com/sustainability/leadership/index.html#anc02

goal of enhancing the value of our human capital, we work topromote for direct dialogues between the management andEfforts in International Standardization Activities

employees, who are an essential management resource.

Hitachi considers international standardization as an activity to define the international rules necessary for achieving sustainable

Furthermore, with the recent rise in ESG investment, we

societies. Hitachi recognizes that international standards are standards or criteria endorsed through fair discussion and international

actively engage in dialogues with shareholders and investors

agreement by members representing specialized fields and diverse stakeholders.

as well.

To this end, Hitachi strives to solve social issues from a global perspective. Hitachi also engages in collaborative creation with a

Dialogues with Stakeholders
https://www.hitachi.com/IR-e/corporate/governance/dialogue/index.html
Disclosure Policy
https://www.hitachi.com/IR-e/corporate/disclosure/index.html

diverse range of stakeholders, including national and regional governments, academic and research institutions, corporations,
NGOs and NPOs, and users around the world to create new social norms (rules) and contribute to sustainable societies throughour Social Innovation Business.
Hitachi believes international standardization is as important as R&D and intellectual property. Hitachi participates actively instandardization activities at international standardization organizations that include IEC*1, ISO*2, and ITU-T*3. Hitachi also participates in consortia established in various regions and industrial fields around the world.

Sustainability Leadership
Approach

Activities

Hitachi is engaged in international standardization activities in various fields including efforts concerning the circular economy(ISO/TC*4 323), the environmental standardization for electrical and electronic products and systems (IEC/TC 111, smart community infrastructures (ISO/TC 268/SC*5 1), and unmanned aircraft systems (ISO/TC 20/SC 16). Providing solutions consistent with

Hitachi work with diverse global initiatives and organizations

international standards through these international standardization activities, Hitachi supports the development of sound global

to make rules that contribute to the creation of a sustainable

markets and facilitate innovation to resolve social issues.

society and to solve social issues.

*1 IEC: International Electrotechnical Commission. An international organization composed of member countries and regions.
*2 ISO: International Organization for Standardization. An international organization composed of member countries and regions.
*3 ITU-T: International Telecommunication Union Telecommunication Standardization Sector. A specialized agency of the United Nations.
*4 TC: Technical Committee*5 SC: Subcommittee

Efforts in International Standardization Activities
http://www.hitachi.com/sustainability/leadership/index.html#anc03

Introduction

Management
CEO’s Message

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Based on its corporate mission of “contribute to society through the development of superior, original technology and products,” Hitachi promotes its Social Innovation Business with the aim of­contributing to the realization of a sustainable society. As part of this, to play its proper role as a global corporation, Hitachi actively participates in international initiatives and groups addressing social
issues on a global scale.

Initiative or Group

Activities

United Nations Global
Compact (UNGC)

Became a participant in 2009.
Joined workshops organized by the
Global Compact Network Japan(GCNJ) on ten different topics infiscal 2022, including ESG, SDGs,
and WEPs (the Women’s
Empowerment Principles)

Sustainability Management

Engagement and Initiatives
External Assessments and Awards

018

Main Initiatives and Groups Hitachi Is Involved withChief Sustainability Officer’s Message
Hitachi Group Identity

Hitachi Sustainability Report 2023

World BusinessCouncil for Sustainable
Development (WBCSD)

Business for Social
Responsibility (BSR)

World Economic ForumTask Force on Climaterelated Financial
Disclosures (TCFD)

Became a member in 1995
Adopted SOS 1.5 project in 2020

Became a member in 2007 andhas participated in the Human
Rights Working Group (HRWG)
since 2016

Participated in Davos Forum since2014

Announced support for TCFD in2018 and disclosed climate-­related
information based on the TCFD
recommendations

Main Initiatives and Groups Hitachi Is Involved with
http://www.hitachi.com/sustainability/leadership/index.html#anc01

Initiative or Group

Activities

Japan Climate Initiative(JCI)

Became a member in 2018
Joined the JCI Race to Zero Circle
established in 2021

The Science Based
Targets initiative (SBTi)

Obtained accreditation of “Targets
for 1.5℃” in 2020

Business Ambition for
1.5°C

Became a member in 2020, alongwith SBT1.5°C certification

Race To Zerocampaign

Joined in 2020, along with
Business Ambition for 1.5°C
commitment

The Valuable 500

Became a member in 2021

ESG Disclosure Study
Group (EDSG)

Participated as a founder andstart-up member since 2020—

Introduction

Management
CEO’s Message

Management

Social Innovation

Environmental

External Assessments and Awards

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

019

Activities

As a corporate group that promotes sustainable management, the Hitachi Group has earned high marks from numbers of external assessment organizations.

Chief Sustainability Officer’s Message
Hitachi Group Identity

Inclusion in ESG Indices (Hitachi, Ltd.)

Sustainability Management
Engagement and Initiatives

External Assessments and Awards(Continued inclusion in 2023)

MSCI Japan ESG Select Leaders Index(Continued inclusion in 2023)

FTSE4Good(Continued inclusion in 2023)

FTSE Blossom Japan Index

https://www.msci.com/our-solutions/indexes

https://www.ftserussell.com/products/indices/ftse4good

https://www.ftserussell.com/products/indices/blossom-japan

THE USE BY HITACHI, LTD. OF ANY MSCI ESG RESEARCH LLC OR ITS AFFILIATES’ (“MSCI”) DATA,AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO
NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT, RECOMMENDATION, OR PROMOTION OF
HITACHI, LTD. BY MSCI. MSCI SERVICES AND DATA ARE THE PROPERTY OF MSCI OR ITSINFORMATION PROVIDERS, AND ARE PROVIDED ‘AS-IS’ AND WITHOUT WARRANTY. MSCI NAMESAND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI.

FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that
Hitachi, Ltd. has been independently assessed according to the FTSE4Good criteria, and has satisfied therequirements to become a constituent of the FTSE4Good Index Series. Created by the global index
provider FTSE Russell, the FTSE4Good Index Series is designed to measure the performance of companies demonstrating strong Environmental, Social and Governance (ESG) practices. The FTSE4Good
indices are used by a wide variety of market participants to create and assess responsible investment
funds and other products

FTSE Russell confirms that Hitachi, Ltd. has been independently assessed according to the index criteria,
and has satisfied the requirements to become a constituent of the FTSE Blossom Japan Index. Created by
the global index and data provider FTSE Russell, the FTSE Blossom Japan Index is designed to measure
the performance of companies demonstrating strong Environmental, Social and Governance (ESG)
practices. The FTSE Blossom Japan Index is used by a wide variety of market participants to create andassess responsible investment funds and other products(Continued in 2023)

FTSE Blossom Japan Sector Relative Index
https://www.ftserussell.com/products/indices/blossom-japan
FTSE Russell confirms that Hitachi, Ltd. has been independently assessed according to the index criteria,
and has satisfied the requirements to become a constituent of the FTSE Blossom Japan Sector RelativeIndex. The FTSE Blossom Japan Sector Relative Index is used by a wide variety of market participants tocreate and assess responsible investment funds and other products(Continued inclusion in 2023)

S&P/JPX Carbon Efficient Index
https://www.jpx.co.jp/english/markets/indices/carbon-efficient/index.html

Introduction

Management
CEO’s Message

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

020

External Assessments Related to ESG
Hitachi, Ltd. earned an AA rating under the MSCI ESG Rating.

Hitachi, Ltd. was selected for the A List, the highest rating

Hitachi, Ltd. has also been certified as Prime in the ESG

given by the CDP for companies, in the two areas of climate

Corporate Rating by ISS ESG.

Chief Sustainability Officer’s Message

change and water security. The company is also selected as a

Hitachi Group Identity

Supplier Engagement Leader, the highest rating for supplier

Sustainability Management

engagement.

Engagement and Initiatives(Rated in 2023)

External Assessments and Awards(Continued inclusion in 2022)

MSCI

ISS ESGhttps://www.issgovernance.com/esg/(Rated in 2022)

CDP
https://www.cdp.net/en

Human Resources Awards and Recognition
Kurumin Certification

Eruboshi Certification

Hitachi, Ltd. received Kurumin certification from the Ministry of Health, Labour and Welfare in

Hitachi, Ltd. pursue diversity as an important component of management strategy and strives to

2011. This certification was granted under Japan’s Act on Advancement of Measures to Support

create work environments that enable diverse talent to play active roles. In recognition of these

Raising Next-Generation-Children, in recognition of Hitachi’s achievement in developing andinitiatives, we received Eruboshi certification, which is conferred to companies that implement

implementing action plans supporting child care, helping employees work with the peace of

exceptional measures under Japan’s Act on Promotion of Women’s Participation andmind that comes from a good work-life balance. In addition to Hitachi, Ltd., several other Group

Advancement in the Workplace. In addition to Hitachi, Ltd., several other Group companies incompanies in Japan received Kurumin certification including Hitachi High-Tech, Hitachi Systems,

Japan have received Eruboshi certification, including Hitachi High-Tech, Hitachi Systems, andand Hitachi Solutions.

Hitachi Solutions.

Introduction

Management

Social Innovation

Environmental

SocialContents
022

Social Innovation BusinessSocial Innovation

Governance

Assurance

Hitachi Sustainability Report 2023

021

Introduction

Social Innovation
Social Innovation Business

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

022

Social Innovation Business
Aiming for a Sustainable Society
Approach

Hitachi’s Social Innovation Business Cases
Activities

Materiality

Hitachi has identified six material topics and 15 sub-material

Advancing a Sustainable Energy Future for All

SF6-free portfolio across the entire high-voltage switchgear

topics as important management issues and pursues sustain-

Hitachi Energy is a global technology leader that is advancing

range, demonstrating the scalability of the portfolio andable management as the core of business strategy.

a sustainable energy future for all and supporting the world-

strengthening the company’s position as a sustainable tech-wide efforts in reducing the impact of greenhouse gases.

nology leader within the industry.

The Mid-term Management Plan 2024 focuses on business that emphasizes both environmental challenges and the

The elimination of SF6 from high-voltage electrical substation

wellbeing of each and every person. Based on this strategy,

equipment is widely accepted as being an important step

we strive to grow and expand our Social Innovation Business.

toward reaching carbon neutrality and enabling more sustainable grid operations. EconiQ, Hitachi Energy’s eco-efficient
portfolio for s­ ustainability, accelerates the industry’s transition

Hitachi’s Social Innovation Businessaway from SF6 with products, services, and solutions, that are
proven to deliver exceptional environmental performance.

Approach

Hitachi aims to support people’s quality of life with data andOver the last two years, Hitachi Energy has made substantial progress in commercializing high-voltage EconiQ

technology that fosters a sustainable society, while respecting

products that eliminate SF6 with scalable solutions for theplanetary boundaries and realizing wellbeing for all individuals.

lowest carbon footprint. Various high-voltage SF6-free EconiQ

The key to achieving this goal is the growth of our Social

products have been installed across the globe, including 72.5

Innovation Business, which is business that provides solutions

and 145-kilovolt (kV) Live Tank Breakers, 145 kV gas-insulated

for social and customer challenges through co-creation withswitchgear, and 420 kV gas-insulated lines.

various partners by leveraging IT x OT x Products and Lumada.
In this section, we discuss examples of our Social
Innovation Business at Hitachi.

An important milestone was the launch of the 420 kV

EconiQ of Hitachi Energy

SF6- free circuit breaker in 2022, a breakthrough technologythat unlocks the widest range of eco-efficient switchgear­applications and accelerates the energy transition. Another

Providing Safe, Convenient and Enjoyable Mobility

innovation, EconiQ retrofill, replaces SF6 in installed high-­

For Hitachi Rail, Social Innovation is simply using innovation

voltage gas-insulated lines with an eco-efficient gas mixtureand digital technology to solve society’s major problems. In

to improve the environmental and life cycle performance of

this framework, the MaaS (Mobility-as-a-Service) project has

the equipment. The commercialization of SF6-free alternatives

been developed and launched in Genova, Italy. MaaS is an

is important as it unlocks new decarbonization pathways for

integrated system of transport aimed at optimizing urban

transmission system operators. Hitachi Energy is reinforcing

mobility through modular solutions, which are more coordi-

its commitment toward a carbon-neutral energy futurenated and efficient. The goal is to answer in a flexible way tothrough EconiQ. Addressing the growing demand for eco-­the increasingly emerging necessity for mass transport in aefficient solutions, Hitachi Energy will continue to expand thesustainable mobility ecosystem.

Introduction

Social Innovation
Social Innovation Business

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

023

Genova is the first city to exploit its potential on a large
scale. In detail, Hitachi Rail—in partnership with the municipal
administration and AMT (the local Mobility and TransportCompany)—has connected 663 buses, 2500 bus stops, thesubway line, two funiculars, one rack railway, ten public elevators and two suburban routes of about 50 km of buses to theplatform. An ambitious initiative that will allow the municipality,
the company and its inhabitants to enjoy a series of technological innovations for the benefit of the quality of life and theenvironment, whilst accelerating the transition to a more susHealthcare Innovation Center Tokyotainable and connected mobility.
As part of this project, Hitachi Rail developed a smart-

Transport Using the Smartphone App GoGoGephone application called “GoGoGe.” It allows users to plan
Hitachi High-Tech opened the Healthcare Innovation

multimodal journeys on all public transport in the city which

Center Tokyo in the Tenkubashi Station/Haneda area. Thissharing services with just a single app. The most distinctive

Hitachi Improves Healthy Life Expectancy
and Wellbeing

feature of the application is that it uses Bluetooth sensors

Healthy life expectancy, the number of years a person cancustomer co-creation and knowledge sharing. We will use theand can be used “handsfree.” Users simply have to turn onlead a normal life without being limited by health problems, isinnovations created at the center to improve the quality of life

the Bluetooth on their smartphones, start the app, and tap

now regarded as one of the most important metrics of thefor people all over the world.

the “Activate Ticket” button. There is no need to operate thehealth of a society. In collaboration with medical and pharma-

app as long as they keep the phone in their pocket or bag.

ceutical professionals, Hitachi improves healthy life expec-

cancer therapy and regenerative medicine in therapeutics. In

Users will be able to check crowding on the buses andtancy and well-being by developing advanced diagnostics andfiscal 2022, Hitachi received a new order for a proton therapy­optimize their movements. But above all else, users

therapy, as well as by supporting digital drug discovery.

system from the University of Wisconsin Health in the United

also includes access to parking lots, e-scooters and car-­can count on an intelligent payment system that will be

Through our work on measurement and analysis systems

charged at the end of the day by applying the best daily ratein the biomedical and life sciences, we contribute to accurate

for the customer.

and reliable in-vitro diagnostics. In the field of clinical chemistry

Through its Social Innovation principle, Hitachi Rail tries daily
to deliver value to all the communities we are proudly part of.

facility is an integrated laboratory, where we will engage in

Hitachi has been actively engaged in advancing radiation

States. While particle therapy with proton beams or carbon-­ion

and immunological blood testing, in particular, Hitachi High-Techanalytical systems are used to conduct approximately 20 billion
tests per year, supporting the advancement of diagnosis andtherapy planning around the world. With regard to new in-vitro
diagnostics, we have invested in U.S. company Invivoscribe,Inc., a global provider of testing services mainly for blood­cancers, and have begun collaborating to advance moleculardiagnostics. This collaboration will enable us to contribute to
the early detection of cancer, therapy planning, and drug
­development by pharmaceutical companies, leading to­healthier and safer societies.

Proton Therapy Equipment Combined with the Hitachi 360° Rotating Gantry
and the Leo Cancer Care Upright System (Artist Impression)

Introduction

Social Innovation
Social Innovation Business

Management

Social Innovation

Environmental

SocialGovernancebeams improves the quality of life for cancer patients since

Creating a Happy Workplace

the patient experiences no pain during treatment, the system

The change from the mass production and consumption

to be installed at the hospital will reduce patient burden further

society of the 20th century to a 21st century society that values

by treating the patient in an upright position. This system will

the environment and diversity is rapidly occurring. So there is

be provided by Leo Cancer Care as an additional option toa growing movement to review companies, work styles, andconventional treatment in the supine position.

communities from the perspective of happiness or, in otherTo improve the efficacy and sophistication of radiotherapy

Assurance

Hitachi Sustainability Report 2023

024

words, wellbeing.

further, Hitachi and Gunma University, a leading Japanese

Hitachi established Happiness Planet, Ltd. in 2020 toinstitution in the field of radiation oncology, jointly establisheddevelop software applications and services that use data to

Advanced Particle Beam Medical Science Joint Researchenable people and groups to be happy and productive. By

Course (Hitachi, Ltd.) in fiscal year 2022.

analyzing large amounts of data, we discovered that people

In regenerative medicine and cell therapy, we initiatedin happy and productive groups are more likely to havejoint research with Kyoto University and Rebirthel Co., Ltd.

triangular-­shaped connections, whereas those in unhappy

to promote the use of allogeneic T-cell therapy, an effective

groups have V-shaped ones. The Happiness Planet applica-

treatment for cancer. The widespread use of allogeneic

tion helps to create such triangular connections, i.e. Factor X

T-cell therapy, which is more versatile and allows for thefor happy and productive people.

treatment of larger numbers of patients, will require theSmartphone App Screenshot

development of automated cell culture technology that
supplies large quantities of cells with consistent quality.
Hitachi will contribute to the practical application of thisorder to create triangular connections and interactions thattechnology through this joint research.

lead to mutual understanding.

In addition, we built—and are now providing—a platform

In fiscal 2022, Happiness Planet provided services to 140

for the management of both cell and traceability informationcompanies and over 10,000 users. This creation of triangularacross the entire value chain of cell and gene therapy prod-

relationships was facilitated in a wide range of organizations in

ucts. We will also support operational transformation in supply

various sectors, from large corporations to small- andchain management, help shorten lead times, and contribute tomedium-­sized enterprises, in areas ranging from IT, manufac-

the supply of high-quality cell and gene therapy products.

turing, finance, healthcare, and nursing. The Hitachi GroupWe actively support digital drug discovery by pursuing theused this app to create triangular relationships between newprovision and development of digital solutions. For example,
we provide AI analytics services to help in the search for

employees in fiscal 2022. Use of the app strengthened peer
Triangular Relationships Essential for Wellbeing in an Organization

relationships, increased employee motivation, and improved

biomarkers that indicate the efficacy and adverse effects ofperformance in examinations for IT certifications. We havedrugs. We are also conducting research and development

also seen a significant reduction in employee turnover, whichwith Axcelead Inc. in drug discovery solutions that utilize

Since organizations tend to have V-shaped or verticalhas been a problem for many companies recently.

digital technology. Our subsidiary, Hitachi High-Techrelationships with people, we use digital technology to help

Solutions, and Keio University in Japan apply materials

establish the triangular relationships that lead to the creationin IT, OT, and products, Hitachi will continue to pursue­informatics in joint research to improve the developmentalof happy and productive groups. Facilitated by smartphone or­initiatives to create happy workplaces, happy lives, andefficiency of small molecule drugs.

PC apps, people are put into groups of three each week inwellbeing in society.

Working with various partners to leverage our strengths

Introduction

Management

Social Innovation

Environmental

Contents
026

Environmental

027

Advancing Our Environmental Visionand Long-Term Environmental Targets

031

Environmental Governance035

Achieving a Decarbonized Society

050

Achieving a Resource-Efficient
Society

055

Achieving a Harmonized Society
with Nature

061

Environmental Data

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

025

Introduction

Environmental

Management

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

026

Environmental

Environmental
Executive Summary
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceAchieving a Decarbonized Society
Achieving a Resource-Efficient Society

Basic Concept
Hitachi’s Mission is to “contribute to society through the development of superior, original technology and products.” We seek solutions to environmental issues, which are of serious concern
to society, through our business operations and promote environmental management from a long-term perspective. Meeting society’s expectations with innovations that mitigate environmental
issues also presents major business opportunities. Hitachi’s Environmental Vision states that “Hitachi will resolve environmental issues and achieve both a higher quality of life and a sustainable
society through its Social Innovation Business in collaborative creation with its stakeholders.” To uphold this vision and work toward achieving a decarbonized society, a resource-efficient society, and a harmonized society with nature, we have established a set of long-term environmental targets looking toward 2050 and 2030 called Hitachi Environmental Innovation 2050 and havebeen promoting Group-wide environmental activities in line with our Environmental Action Plan, which is updated every three years.

Achieving a Harmonized Society with Nature
Environmental Data
Topic

Overview

Targets, KPIs, and Results

CO2 avoided emissions through products andservices
Achieving a
DecarbonizedSociety

We engage in decarbonization businesses through co-creation with customers to contribute torealize a decarbonized society. We also pursue initiatives to reduce CO2 emissions from the use of
our products and services. In addition, we strive to achieve carbon neutrality by fiscal 2030 in ourfactories and offices, and by fiscal 2050 throughout our value chain.

FY2024 Target: 100 million metric tons/year
Forecast: 126.1 million metric tons/year*1

Reduction rate of total CO2 at business sites(­factories and offices) (compared to FY2010)
FY2022 Target: 32%
FY2022 Result: 40%

Number of sites achieving zero landfill waste*2
Achieving a
ResourceEfficient
Society

To build a society that uses resources and water efficiently with customers and society, we set
a target to improve the efficiency of resources and water use within the Hitachi Group by 50%­(compared with FY2010) by fiscal 2050. We will create higher economic value using fewer resources
while pursuing production activities with a lower environmental burden.

FY2022 Target: 90 sites

FY2022 Results: 199 sites ( 58% achievement)

Reduction rate in water use per unit
(compared to FY2010)
FY2022 Target: 22%
FY2022 Results: 27%

Achieving a
HarmonizedSociety with
NatureWe classify the emission of greenhouse gases and chemical substances into the atmosphere andthe generation of waste materials in the course of our business activities as negative impact activities. Providing products and services that contribute to ecosystem preservation and undertaking
activities to preserve biodiversity and ecosystems are categorized as positive impact activities.
We are working to quantify and minimize the gap between positive and negative impacts by 2050.

*1 Three-year average during the Mid-term Management Plan 2024

*2 Pursued in assumed conformance with regulations, conditions, etc. Less than 0.5%

Reduction rate in chemical atmospheric emissions
per unit (compared to FY2010)
FY2022 targets: 5%
FY2022 results: 21%

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Environmental

Advancing Our Environmental Vision and Long-Term Environmental Targets

Environmental“Environmental Vision” and “Hitachi Environmental Innovation 2050”

Advancing Our Environmental Vision andLong-Term Environmental Targets
	“Environmental Vision” and“Hitachi Environmental Innovation 2050”
Environmental Action Plan
Environmental GovernanceAchieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

Taking into account the growing urgency of environmental

vision for society from a long-term perspective. In working
toward achieving this vision, we have established a set ofsociety with nature under the banner of Hitachi Environmental

TargetGRI 2-23

Environmental Vision
Hitachi will resolve environmental issues and achieve both a higher quality of life and a sustainable society
through its Social Innovation Business in collaborative creation with its stakeholders.
The aim of Hitachi’s environmental management

long-term environmental targets aimed at building a decarbonized society, a resource-efficient society, and a harmonized

Policy027

Environmental Vision and Long-term Environmental Targets: Hitachi Environmental Innovation 2050

issues in the world and the management policies, Hitachi
formulated an Environmental Vision that clearly outlines our

Hitachi Sustainability Report 2023

Assurance

Decarbonized society

Resource Efficient Society

Harmonized Society with Nature

Climate Change Mitigation/Adaptation

Saving and Recycling Resources

Preservation of Ecosystems

Innovation 2050 and are working to advance them.
The movement toward a decarbonized society is acceler-

Long-term Environmental Targets

ating both in Japan and internationally. We are seeing thedecarbonization of entire value chains and an accompanying
green transformation (GX). Hitachi set a goal to achievecarbon neutrality by fiscal 2030 in our factories and offices,and by fiscal 2050 throughout our value chain. We are currently engaged in measures to achieve these goals.
To meet our goal of Achieving a Resource-Efficient
Society, we aim to create a sustainable society, while keeping
the transition to a circular economy in mind, by improving theefficiency of water and resources use at Hitachi by 50% by
fiscal 2050 (compared to fiscal 2010 levels).
To meet our goal of Achieving a Harmonized Society with

Hitachi’s resolution looking toward 2050 and 2030

Hitachi Environmental Innovation 2050
For a decarbonized society

For a resource efficient society

For a harmonized society with nature

Achieve carbon neutrality by
FY2050 through the value chain
Reduce CO2 emissions 50%
by FY2030 (compared to FY2010)

Build a society that uses water andother resources efficiently
with customers and society

Impact on
natural capital

Efficiency in use of water/resources

Minimized

Achieve carbon neutrality
by FY2030 at business sites(factories and offices)50%
FY2050
improvement(compared to FY2010 in Hitachi Group)

Nature, we strive to minimize our impact on natural capital bykeeping a close eye on international initiatives such as theEnvironmental Action Plan

15th Conference of the Parties (COP15) to the Convention on
Biological Diversity, held in December 2022, and the Task
Force on Nature-Related Financial Disclosure (TNFD).
Hitachi’s environmental initiatives, including the achievement of these long-term environmental targets, are mandated
by the short-term Environmental Action Plan which is updated
every three years and pursued Group-wide.

Set environmental action items and targets every three years in order to achieve the long-term targets
P.035 Achieving a Decarbonized Society

P.050 Achieving a Resource-Efficient Society

P.055 Achieving a Harmonized Society with Nature

Introduction

Environmental

Social Innovation

Environmental

SocialGovernance

Progress in Reaching Hitachi Environmental Innovation 2050 Targets
TargetEnvironmental

Management

Activities

We are making progress with major Hitachi Environmental Innovation 2050 targets, as shown below. We are generally on track, andAdvancing Our Environmental Vision andLong-Term Environmental Targets

we will continue strengthening our environmental activities to achieve these targets. Regarding our long-term value chain target to	“Environmental Vision” and“Hitachi Environmental Innovation 2050”

top-tier environmental performance.

Environmental Action Plan
Environmental Governancehelp build a decarbonized society, we are developing activities which help to reduce CO2 emissions by providing products with

For a decarbonized society
Reduced CO2 Emissions at Business Sites ( Factories and offices)Achieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Reduction rate of total CO2(compared to FY2010)

FY2022 target

FY2022 result

FY2030 target

FY2050 target

32%

40%

100% (carbon neutrality)(Maintain 100%)

Environmental Data
For a resource efficient society
Enhanced Efficiency in the Use of Waste and Valuable Generation at Business Sites (Factories and Offices)

Reduction rate in waste andvaluables generation perunit (compared to FY2010
Hitachi Group)

FY2022 target

FY2022 result

FY2030 target

FY2050 target

14%

16%

―

50% reduction

Enhanced Efficiency in the Use of Water at Business Sites (Factories and Offices)

Reduction rate in water use
per unit (compared to
FY2010 Hitachi Group)

FY2022 target

FY2022 result

FY2030 target

FY2050 target

22%

27%

―

50% reduction

Note: See the referenced pages for details on the figures cited.

Assurance

Hitachi Sustainability Report 2023

028

Introduction

Environmental

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

029

Green Strategy
Approach

Environmental

Green Strategies for Sustainable Growth

Advancing Our Environmental Vision andLong-Term Environmental Targets

Hitachi contributes solutions to environmental issues through our Social Innovation Business. Aiming to be a Climate Change Innovator that leads the way in contributing to the decarbonization of	“Environmental Vision” and“Hitachi Environmental Innovation 2050”

the green transformation of our customers and society. By moving forward in both GX for CORE and GX for GROWTH, we will accelerate the deeper development of technology and expertise, improv-

Environmental Action Plan­society, we formulated a Green Strategy consisting of two pillars: GX for CORE, through which we accelerate Hitachi Group green transformation, and GX for GROWTH, through which we contribute to
ing the environmental value Hitachi provides on a continued basis.
The Hitachi Green Strategy contributes to the creation of decarbonized and resource-efficient societies that are harmonized with nature.

Environmental GovernanceAchieving a Decarbonized Society

The Hitachi Green Strategy

Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

GX

for CORE

Combine the Two GX Strategies toCreate and Enhance Solutions• Achieve carbon neutrality of in-house production

GX

for GROWTH• Provide products and services with low

activities➞ Achieve carbon neutrality for Scope 1 and 2
by FY2030 and throughout the entire value
chain by FY2050­environmental impact➞ 100 million metric tons of CO2 avoided
emissions per year (As of FY2024)• Promote the transition to a circular economy• Use resources effectively

and contribute to ecosystem conservation
through waste reduction associated with thetransition to a circular economy➞ Improve efficiency in use of water/resources,
and promote eco-designs• Preserve ecosystems

Example: Initiatives to eliminate the useof all fossil fuels at businesssites (Italy)

Example: D evelopment of ESG
solutions for sustainability
management

Example: H
 VDC conversion plant
for the mass adoption ofrenewable energy

Introduction

Environmental
Environmental

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental Vision” and“Hitachi Environmental Innovation 2050”

Management

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

030

Environmental Action Plan
To achieve its Environmental Vision and the Hitachi Environmental Innovation 2050 long-term environmental targets, Hitachi draws up an Environmental Action Plan containing indicators and targets
for the three-year period covered by the Mid-term Management Plan and steadily promotes its implementation.

Environmental Action Plan for 2024 (Fiscal 2022–2024)
TargetActivities

	Environmental Action Plan

Hitachi pursues environmental activities under the Environmental Action Plan for 2024 (Fiscal 2022–2024) that were based on the 2024 Mid-term Management Plan. The targets set for fiscal 2022 andEnvironmental Governanceour results are as follows.

Achieving a Decarbonized Society
Achieving a Resource-Efficient Society

Environmental Action Plan for 2024
Our environmental activities and targets are updated every three years with a view to achieving our long-term environmental targets.

Achieving a Harmonized Society with Nature

Items

Environmental Data
Environmental Management

Indicators
Promote environmental human capital development

Reduce total CO2

Reduction rate of total CO2*1 (compared to FY2010)

Improve transportation energy consumption per unit (Japan)

Improvement rate of transportation energy consumption per unit
(Japan)*2 (compared to FY2020)

2%

Reduction rate of CO2 emissions per unit (compared to FY2010)

12%

A DecarbonizedSociety
Products andservices

Reduce CO2 emissions of products
and services

Promote eco-design

Factories and offices

Enhance efficiency in the use ofresources◆◆: Partially achieved

FY2023 targets

Final FY (2024)
targets

Environmental human capital development mindful of changes in personnel
composition, including generational shifts
40%
32%
35%
50%

◆◆◆
14%

◆◆◆
15%

◆◆◆

3%

4%

13%

14%

CO2 avoided emissions

Target: CO2 avoided emissions of 100 million metric tons per year (FY2024)
Forecast: CO2 avoided emissions of 126.1 million metric tons per year*4

Environmentally conscious design assessments and LCA application rates for newly developed and designed products

Target: Full application Eco-Design for all newly developed products
FY2022 Results: 357 products identified as subject of Eco-Design

Number of sites achieving zero landfill waste*3

A HarmonizedSociety with
NatureFY2022 targets

Environmental human Promote environmental human capital
capital development development
Factories and offices

A Resource
Efficient Society◆◆◆: Achieved
FY2022 results(achievementlevel)

Reduction rate in waste and valuables generation per unit
(compared to FY2010)

90
14%

Reduction rate in water use per unit (compared to FY2010)22%

Effective utilization rate of plastic waste

77%

199

◆◆◆
16%

◆◆◆
27%

◆◆◆
88%

◆◆◆

124

158

17%

20%

23%

24%

81%

85%

Water risks

Respond to water risks

Responding to water risks

Chemical substance

Reduce chemical emissions

Reduction rate in chemical atmospheric emissions per unit
(compared to FY2010)

Ecosystem
preservation

Impact on natural capital

Calculation of negative impacts (business unit/Group company-level LCA implementation) / Calculation of positive impacts (forest conservation activities)*1 Reduction rate of total CO2: Indicator representing CO2 emissions from Hitachi’s consumption of energy alone*2 This is a target for Japan only. Targets in other countries are set on a voluntary basis.
*3 Pursued in assumed conformance with regulations, conditions, etc. Less than 0.5%
*4 Three-year average

Minimization of business impacts regarding water risks
5%

21%

◆◆◆

6%

8%

Introduction

Management

Social Innovation

Environmental

Environmental

Environmental Governance

Environmental

Framework for Promoting Environmental Governance

Advancing Our Environmental Vision andLong-Term Environmental Targets

SocialGovernance

Structure

Assurance

Hitachi Sustainability Report 2023

031

GRI 2-12/2-13/2-24

To achieve our Environmental Vision and Hitachi Environmental Innovation 2050 long-term tar-

Hitachi, Ltd., a company with Nominating Committee, etc. under the Companies Act, has

Environmental Governancegets, Hitachi is building a global system to support decision-making and environmental manage-

adopted a committee system to separate the responsibilities for management oversight from the	Framework for Promoting Environmental
Governancement for Hitachi, Ltd. and 697 consolidated subsidiaries (as of March 31, 2023).

execution of business operations. Under this system, the Audit Committee of independent direc-

Environmental Management System
Achieving a Decarbonized Society
Achieving a Resource-Efficient Society

In fiscal 2022, we established the Sustainability Promotion Meeting, chaired by the chief

tors conducts an audit of sustainability-related operations once a year. Reports on climate

sustainability officer and consisting mostly of managers from each business unit (BU) and majorchange and other environment-related material issues are made to the committee by executive

Group company. The purpose of these meetings is to discuss and share information related to

officers of Hitachi, Ltd.

environmental issues and other important matters related to sustainability. The Senior Executive

P.015 Framework for Promoting Sustainability Strategy

Committee discusses and makes decisions related to important environmental matters forP.029 Green Strategy

Achieving a Harmonized Society with Natureachieving our long-term environmental targets, including decarbonization, water use, andEnvironmental Data

resource circulation. Matters are referred to the Board of Directors when necessary.
Hitachi established separate meetings to address important topics such as carbon neutrality
and the circular economy. The main members attending these meetings are individuals responsible
for environmental activities at each BU and key Group companies. Through these meetings, wepursue environmental activities across Hitachi Group, examining measures and sharing information.
Aiming to be a global leader in green transformation (GX), Hitachi formulated a Green
Strategy consisting of GX for CORE and GX for GROWTH, striving to put into place a frame-

P.035 Achieving a Decarbonized Society

Environmental Value Promotion Meetings
Meeting

Attendees

PurposeFrequency

Sustainability
Promotion Meeting

Chief Sustainability Officer, Business promotion heads at BUs and key Group companies,
and RHQ Sustainability Officers
Heads of Business promotion/Environmentrelated/ MONOZUKURI (production)/
Procurement divisions from BUs and key
Group companies

Deliberation, information sharing related
to material sustainability initiatives

Once ortwice peryear

Deliberation, planning, and implementation of action plans (environmental actionplans) to achieve the Hitachi environmental long-term goals

Twice peryear

Eco-Management
CN2030 Promotion
Project Meeting

Heads and members of Environment-related/
MONOZUKURI (production) divisions fromBUs and key Group companies

Monitoring and implementation of CN
action plan and discussion ofacceleration

Twice peryear

Eco-Management
3R Promotion
Project Meeting

Heads and members of Environment-related/
MONOZUKURI (production) divisions fromBUs and key Group companies

Promotion of actions for 3R activities
toward realizing CE

Four times
per year

Sustainable
Procurement
Conference

Chief Procurement Officer, heads of the
procurement divisions at BUs and key Group
companies, and individuals responsible forand engaged in sustainable procurement

Communicate the Hitachi Group sustainable procurement policies and strategies
to all procurement divisions, improveknowledge and share best practices

Twice peryear

Eco-Management
Meeting

work to execute our strategy.
Framework for Promoting Environmental Governance
Board of Directors
Senior Executive Committee
Sustainability Promotion Meeting
Eco-Management Meeting
Carbon Neutrality (CN)Circular Economy (CE)Eco-Management
CN2030 Promotion
Project Meeting

Eco-Management
3R Promotion
Project Meeting

Executive Compensation System Linked Environmental Value
SystemIn fiscal 2023, we revised our executive compensation system, linking the system more closely
to corporate value to accelerate our growth as a global company further. Refer to the following

Sustainable Procurement Conference

link for more details.
P.013 Reflecting Sustainability Targets in Executive Compensation Evaluation

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Environmental Governance
Framework for Promoting Environmental
Governance	Environmental Management System
Achieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental DataManagement

Environmental

Social Innovation

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

032

Environmental Management System
Enhancing Our Environmental Management System
SystemEnvironmental Data Collection System
GRI 2-25/3-3

Activities

Activities

Hitachi has approximately 1,300 business sites of different

adhering to our in-house environmental management system,

As part of our environmental management, Hitachi uses thesizes engaging in a wide variety of activities. We classify these

our main global category A manufacturing sites have acquired

Environmental Data Collection System (Eco-DS) to collectsites into one of three environmental-risk categories: A

third-party certifications, such as ISO 14001.

about 20 categories of environmental load-related data rang-(major), B (medium), and C (minor). This categorization is

We also established a system to encourage procurementing from energy use, water use, and waste generation, tobased on globally accepted criteria for environmental man-partners to reduce their environmental impact, including

whether an item falls under relevant environmental laws andagement classification* , and we implement our environmental

carbon neutrality upstream in the value chain. We summarize

regulations, and environmental accounting. In fiscal 2022,

management according to the environmental risk at eachand publicize various guidelines describing the Hitachi

data collection covered about 1,300 business sites in 67

given site. In fiscal 2022, approximately 150 major sites wereapproach to sustainable and green procurement and othercountries. We are working to progressively expand the scopeclassified as Category A. Sites of companies acquired bymatters with which we expect procurement partners toof data collection in order to estimate the environmental load

Hitachi that have a large environmental impact (equivalent tocomply. At the same time, we continue to improve supplierof the entire Hitachi Group.

Category A) will eventually be classified as Category A. We will

engagement by holding briefings on procurement and con-make this classification after an alignment period of a few

ducting sustainability audits.

1

years, during which we will adapt the sites to our environmental management system.
The business units and Group companies that manage A
sites participate in drafting the Eco-Management Meeting’s
Environmental Action Plan, setting and striving to achieve*1 We score each site based on criteria for environmental management classification, such as electricity consumption, waste generation, water use andlegal compliance. Based on this score, we categorize the site into one of thethree categories.

P.068 Number of ISO 14001 Certified Companies
P.108 Responsible Procurement

The aggregated data is used to provide feedback to
improve environmental measures, such as in determining
business site environmental management classifications,
identifying environmental management issues, and sharing
instructive examples within the Group. In addition, we compile data on key metrics twice a year for the approximately
150 major sites identified as Category A.

targets based on this plan. We publicize the Environmental

We established an international help desk to support

Action Plan throughout the Hitachi Group through environ-the system and encourage an understanding of environ-mental strategy officers, chosen from among the heads ofmental management, offering support in Japanese, English,

environment divisions of those organizations. In addition to

and Chinese.

Note: Hitachi normally refers to suppliers (including vendors and providers) as procurement partners, with whom we build business together on an equal footing.

Introduction

Environmental
Environmental

Management

Social Innovation

Chemical Substance Management System
Hitachi manages data on chemical substances in procured
materials, parts, and products using A Gree’Net, a green

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

033

Environmental Education for Employees
Activities

Training

procurement system compatible with the chemSHERPA*1

Hitachi offers e-learning based environmental education to all

management and internal environmental audits. Particularly in

Advancing Our Environmental Vision andLong-Term Environmental Targets

format. This framework allows us to identify the chemicalGroup employees, from new hires to senior management. We

China, where we have more than 20 Category A sites, we

substances are used in our products—from design and devel-also provide annual specialized training on environmental risks

provide training focused on compliance with the country’s

Environmental Governanceopment, procurement, and production to quality assurance

and compliance with environment-related laws and regula-increasingly strict environmental laws and regulations.

and shipping—and to respond to the legal and regulatory

tions for working-level employees in charge of environmental

Framework for Promoting Environmental
Governance	Environmental Management System
Achieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Dataframeworks of our export partners.
To ensure proper use of chemical substances in our business operations, we operate a database for chemical sub-Environmental Education in Fiscal 2022
Contents of training

Targetstance management called CEGNET, which keeps track of thelatest laws and regulations and our own voluntary regulations
and supports searches for new substance risks. The system
also registers chemical substances used and aggregates data

Hitachi Group training on recent amendments tolaws and operational procedures as well as basic
environmental management

Employees working in air
quality, water quality, andwaste management

Japan:	1637 people from 71 companies(921 people in waste management,
plus 716 people in legal compliance)
China: 139 people from 52 companies

Environmental management training program to
reduce environmental risks in China and raise theknowledge of working-level employees

Working-level employees

153 people from 48 companies

Training for new employees

New employees in the China
Hitachi Group17 people from 8 companies

on amounts handled, emitted, and transferred in our operations, helping to reduce volume.
*1 chemSHERPA: A shared transmission scheme throughout the supply chain toensure proper management of chemical substances in products and continuing
compliance with the ever-growing requirements of major global laws and regulations like the REACH regulation (EU regulation of Registration, Evaluation,
Authorisation and Restriction of Chemicals) and RoHS directive (EU rules restricting the use of hazardous substances in electrical and electronic equipment).

Number of participants

Achievements in FY2022:
Briefings for Procurement Partners
We registered data regarding chemical substances contained in approximately 1.25 million materials, parts, andproducts in A Gree’Net as of the end of fiscal 2022. Each
year, we hold briefings for procurement partners using
A Gree’Net, chemSHERPA, and on regulatory revision
trends. In fiscal 2022, we held eight online briefings
attended by a cumulative 1,920 people.

Note: Hitachi normally refers to suppliers (including vendors and providers) as procurement partners, with whom we build business together on an equal footing

Introduction

Environmental

Management

Social Innovation

Environmental

SocialGovernance

Environmental Compliance
Activities

Environmental

In addition to ensuring compliance with the laws and regula-

If we discover a violation or receive a complaint, we take

Advancing Our Environmental Vision andLong-Term Environmental Targets

tions of each country and region, Hitachi strives to minimize

steps to share information about the causes and countermea-

environmental risks by setting compliance with voluntarysures throughout the Group, tying these efforts to the preven-

Environmental Governancemanagement criteria that are more stringent than regulatorytion of similar incidents. We designate business sites where

Framework for Promoting Environmental
Governancerequirements and by conducting internal audits. We makelegal or regulatory violations have occurred as high-risk busi-

periodic examinations of soil and groundwater to detect

ness sites for a three-year period as a corrective measure.

	Environmental Management System­contamination at business sites where hazardous chemical

Appropriate guidance provided to such sites by business units

substances are, or once were, used. If contamination is

and Group companies in charge of their management serves

found, we conduct cleaning and monitoring activities until

to strengthen their compliance activities on an ongoing basis

decontamination is complete.

and prevent recurrences.

Achieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

Implementation Status of Internal Environmental Audits
Implementing divisionCorporate division of Hitachi, Ltd.
(Sustainability Promotion Division)

TargetBusiness units, headquarters of Group companies, andbusiness sites classified as Category A in our environmental management classification
Major business sites and subsidiaries of business units andGroup companies*1

Corporate divisions of business units andGroup companies (environment divisions)

ISO 14001-certified sites (audit teams)

Frequency

Usually every threeyears

Sites of business units and Group companies outside
Japan that are classified as Category A in our environmental management classification*2
Divisions within business sites*1 According to the Hitachi Group Global Audit Standards, which specify matters concerning internal audits conducted by business units and Group companies.
*2 According to the Environmental Action Plan.

P.068 Number of Regulatory Violations and Complaints

Assurance

Hitachi Sustainability Report 2023

034

Introduction

Management

Environmental

Social Innovation

Environmental

Achieving a Decarbonized Society

Environmental

Efforts to Achieve a Decarbonized Society

Advancing Our Environmental Vision andLong-Term Environmental Targets

As the response to climate change becomes more of a global

Environmental Governancetinues to change in dramatic ways. At the 27th Conference of

Achieving a Decarbonized Society

the Parties (COP27) to the United Nations Framework	Efforts to Achieve a DecarbonizedSociety

Convention on Climate Change in Sharm el-Sheikh, Egypt, in

Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

trend, the roles required of governments and companies con-November 2022, participants called for effective and equitableclimate change action, along with further increases in greenhouse gas reduction targets by nation.
To help build a decarbonized society, Hitachi has set thetarget and strive to achieve carbon neutrality throughout thevalue chain by fiscal 2050 as part of the long-term environmental targets we call Hitachi Environmental Innovation 2050.
Under GX for CORE, one of the two pillars of our green strategy, we accelerate measures to reduce our own CO2 emissions to achieve carbon neutrality by fiscal 2030 at ourbusiness sites (factories and offices). Under GX for GROWTH,
we reduce emissions related to the use of products and services sold, which account for a large portion of CO2 emissions
in Hitachi’s value chain. Since improvement in this area is the
key to reducing CO2 emissions in the value chain, we contrib-

ApproachSocialMateriality

Governance

Assurance

Hitachi Sustainability Report 2023

035

GRI 2-13/2-24/3-3

Environmental Strategy for Achieving a Decarbonized Society
Targets

Activities

Initiatives for Achieving a Decarbonized Society(1) Achieve carbon neutrality at our own business sites and production activities (by fiscal 2030)• Introduce energy-saving and renewable energy equipment.
• Procure 100% non-fossil electricity across all business sites.
(2) Achieve the world’s highest level of energy conservation in products• Achieve energy conservation by developing products that take the environment into consideration from the design stage.
(3) Work with procurement partners toward a decarbonized society• Distributed Sustainable Procurement Guidelines and Green Procurement Guidelines, requesting all procurement partners to set
greenhouse gas reduction targets• Based on the results of a questionnaire survey on climate change-related initiatives among environmental focus partners in
FY2021, we selected 21 new environmental advanced partners with whom to hold discussions in FY2022.
(4) Support businesses that contribute to the carbon neutrality of society as a whole• Power grids business to support the expansion of renewable energy.
• Provision of energy-efficient high-speed trains and storage battery hybrid trains for the spread of carbon-free mobility.
• Provide Lumada solutions that support the realization of a decarbonized society through digitalization.
(5) Develop technologies to realize the transition to a decarbonized society• Development of high-efficiency products, energy management systems and hydrogen-related technologies.

ute to customer decarbonization and that of society throughproducts and services having with low environmental impact.
Hitachi will continue to grow businesses that contribute togreen policies and to the decarbonization of society as a wholethrough collaborative creation with stakeholders.
Ratio of CO2 Emissions at Each Stage of Hitachi Value Chain
in Fiscal 2022
Procurement of
Raw Materials
and Parts

Production

Transport

Use of Products
and Services

9.6%

0.6%

0.1%

89.1%

Waste Disposal/
Recycling

Others (Capital
goods, etc.)

0.1%

0.5%

Green Strategy• GX for CORE: Achieve carbon neutrality at business sites (factories and offices) by FY2030. Reduce CO2 emissions by 50% compared with fiscal 2010 levels by fiscal 2030 and achieve carbon neutrality across the entire value chain by fiscal 2050
• GX for GROWTH: Contribute to the decarbonization of customers and society through products and services having with low environmental impact (CO2 avoided emissions: 100 million metric tons in fiscal 2024)

P.029 Green Strategy
P.036 Expanding the Decarbonization BusinessP.039 CO2 Emission Reduction at Business Sites (Factories and Offices) and Hitachi Carbon Neutrality 2030
P.108 Responsible Procurement
Hitachi Integrated report 2023 / Green Strategy (P.024)* Percentages may fluctuate due to changes in our business portfolios

https://www.hitachi.com/IR-e/library/integrated/

Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

Social Innovation

Approachto a decarbonized society through businesses that reduce

Achieving a Decarbonized Society

CO2 emissions and collaborative creation with customers.

Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

Assurance

Hitachi Sustainability Report 2023

Approach036

GRI 305-4/305-5

Activities

Achieving a Decarbonized Society

Contributing to a Decarbonized Society at
Business Sites (Factories and Offices)

Governance

Expanding the Decarbonization Business

Hitachi provides value to customers and society, contributing

Society Through the Decarbonization
Business

SocialContributing to a Decarbonized Society Through the Decarbonization Business

Environmental Governance	Contributing to a Decarbonized

Environmental

Examples of Decarbonization Business: A Hitachi Focus

Power grid solutions· Contribution to the mass adoption of renewable energy through HVDC*1· Enhancing efficiency of transformers, high voltage products, and power transmission/distribution

Grid automation· Advancing smart grid control, etc.

Power generation· Widespread use of power generation systems that utilize non-fossil energy
sources such as wind and nuclear power

Railway business· Enhancing energy-saving features of rolling stock· Developing smart operating systems· Enhancing maintenance service efficiency through rolling stock monitoring

Finance and public oriented
solutions· Promoting digital solutions

Data centers· Developing smart data centers

Servers/storage· Enhancing energy-saving features of servers and storage

Smart logistics· Improving energy-saving features through fully IT-enhanced logistics

Factory automation· Enhancing energy efficiency through shorter lead times

Water business· Enhancing efficiency of water and sewage systems

Industrial products· Enhancing efficiency of industrial products· Electrification of fossil-fuel equipment

Smart cities· Reducing CO2 through comprehensive urban energy management solutions

Home appliances· Enhancing energy efficiency of home appliances· Promoting connected home appliances

Smart therapies· Enhancing energy-saving features of medical devices

Elevators· Enhancing energy-saving features of elevators and escalators throughreplacement· Enhancing energy efficiency through total building solutions

Hitachi operates under three business domains: Green Energy
and Mobility, Digital Systems and Services, and Connective
Industries. Among these domains, we are growing the follow-

Green Energy & Mobility

ing businesses, which contribute to decarbonization.
• Businesses that help to accelerate the energy shift aimed atrealizing decarbonization, and that provide safe, comfortable, and clean mobility (Green Energy and Mobility)• Businesses that help to reduce CO2 emissions by using
cutting-edge digital technologies to improve the efficiency ofsystems that underpin society (Digital Systems and Services)• Businesses that help to decarbonize industries and cities by

Digital Systems &Services

creating a resilient supply chain (Connective Industries)

Connective Industries*1 HVDC: High Voltage Direct Current

Introduction

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

037

CO2 Emissions Reduction as Avoided Emissions
Approach

Environmental

Management

Materiality

Hitachi calculates the contribution to decarbonization throughHitachi contributes to the reduction of customer CO2

The World Business Council for Sustainable Development

collaborative creation with customers as CO2 avoided emis-

emissions mainly in the following three areas:

issued guidance in March 2023 on avoided emissions. In

sions. We convert the amount of the contribution to customer(1) Contribution via conversion to non-fossil energy

Japan, the GX League*2 is considering the use of avoided

Environmental Governancedecarbonization via Hitachi products and services into CO2Contribution by providing key components for the introduction

emissions in relation to disclosures and the assessment of

Achieving a Decarbonized Society

emissions. We expect an average 126.1 million metric tons ofof non-fossil energy including renewable energy, such as HVDC

climate-related opportunities. A unified guide on specificCO2 avoided emissions per year during the Mid-term(2) Contribution via energy conservation­calculation methods for products and services is under dis-Management Plan 2024, compared to our original target ofContribution by providing energy-saving features through thecussion, and Hitachi is participating in these discussions.

approximately 100 million metric tons per year in fiscal 2024.

optimization of highly efficient products and controls, such as

Achieving a Decarbonized Society	Contributing to a DecarbonizedSociety Through the Decarbonization
Business

Hitachi calculates CO2 avoided emissions based on ahigh-efficiency industrial equipment

Contributing to a Decarbonized Society at
Business Sites (Factories and Offices)comparison of customer CO2 emissions from the use of(3) Contribution via electrification

Hitachi products and services during the fiscal year in ques-Contribution through the electrification of products currently

Climate-related Financial Information Disclosure(Based on TCFD Recommendations)tion with emissions from Hitachi products and services

using fossil energy, including the electrification of industrial

during the base year. In principle, the base year for this cal-equipment

Calculating CO2 Emissions Reduction as Avoided Emissions① Conversion to Non-Fossil Energy② Energy savings③ Electrification• We calculate the amount of CO2 emissions reduced by using
non-fossil energy sources compared to electricity supplied fromthe grid• We calculate the amount of CO2 emissions reduced by improving
energy efficiency compared to products and services with equivalent functions• We calculate the amount of CO2 emission reductions compared
to products and services before electrification

Examples: HVDC, wind turbines, etc.

Examples: Compressors, elevators, etc.

Example: Electrification of industrial equipment

CO2 Avoided
Emissions

Grid power fromthermal power
generation, etc.

Non-fossil-derived
electricity from wind
power generation, etc.

CO2 Avoided Emissions

CO2 Avoided Emissions
CO2 Emissions

Environmental Data

*1 In accordance with the base year of Japan’s national CO2 reduction target. For
the consolidated energy-related company, we set fiscal 2020 as the base year
based on the year the company joined the Hitachi Group.

CO2 Emissions

Achieving a Harmonized Society with Nature

culation is fiscal 2013* .
1

CO2 Emissions

Achieving a Resource-Efficient Society*2 A place where companies aiming to achieve sustainable growth with a view to
becoming carbon neutral by 2050 and coming social changes collaborate withcompanies engaged in similar initiatives, as well as entities from across industry,
government, and academia.

Old Products

New Products

Transportation/­
industrial engines(fossil fuels)

Transportation/
Industrial Motors

Introduction

Environmental
Environmental

Management

Social Innovation

Improving the Environmental Performance ofProducts and Services Through Eco-Design
SystemActivities

Materiality

Environmental

SocialGovernanceApproach

CO2 emissions related to the use of products and services
account for the largest proportion of emissions in our value

Hitachi promotes eco-designs by applying our Environmentally

chain. To reduce these emissions, Hitachi sets reduction rate

Environmental GovernanceConscious Design Assessments to steadily improve environ-targets per unit based on fiscal 2010 levels for each product or

Achieving a Decarbonized Society

mental performance throughout the Group. This assessment

service targeted. We use functional size*1 as the denominator

Achieving a Decarbonized Society

identifies a total of 30 environmental impact categories thatand CO2 emissions as the numerator in our target equation.

Contributing to a Decarbonized Society at
Business Sites (Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

affect climate change, resource depletion, and ecosystem

In fiscal 2022, we achieved our target with a reduction

degradation at each stage of the life cycle of products andrate of 15% against a target of 12%. The achievement of thisservices. In this way, we assess the reduction of environmental

target was driven by the introduction of new models of highimpact from business activities across multiple perspectives.

energy-saving equipment used in industrial equipment andsocial infrastructure.

Initiatives for Improving Environmental Performanceof Products and Services

company to the calculation of Hitachi Group emissions,• Promoting environmentally conscious processes: In accor-

resulting in a significant increase in emissions throughout thedance with the IEC 62430*1 criteria, promote environmentally conscious processes in designing and developing
products and services, including by meeting environmental

company that are used widely in the global power infrastruc-regulatory requirements and ascertaining the environment-­

ture. Hitachi will continue to bring energy-efficient products torelated needs of our stakeholders within our existing

the market.

­management system.
• Implementing Life Cycle Assessments (LCAs): For ourmain, priority products, quantitatively evaluate their global
environmental burden in such areas as the consumption ofmineral resources, fossil fuels, and water resources, as wellas their impact on climate change and air pollution, disclose the results to our stakeholders, and utilize them in
improving the design of next-generation products.
*1 IEC62430: The standard developed by the International ElectrotechnicalCommission (IEC) concerning environmentally conscious design for electricaland electronic products.

P.051 Approach to Transitioning to a Circular Economy/
Innovation in Product Design

038

Activities

For all products and services involving a design process,Society Through the Decarbonization
Business

Hitachi Sustainability Report 2023

Reduction of Product and Service CO2 Emissions During Use

Advancing Our Environmental Vision andLong-Term Environmental Targets	
Contributing to a Decarbonized

Assurance

We added the emissions of a consolidated energy-related

Environmental Action Plan for 2024 Management Values
Reduction in CO2 Emissions per Unit (Hitachi Group)

From base year

15
reduction%

CO2 emissions
from use of products

100%

Target: 12%

CO2 emissions
from use of products

85%

Function size

Function sizevalue chain. This increase is due to higher emissions from the

FY2010

FY2022use of transformers and other key products provided by the(base year)*1 Function size: Major functions of products correlated with CO2 emissions, suchas their output and volume

Introduction

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Social Innovation

Environmental

PolicyActivities

neutrality by fiscal 2030 at all business sites (factories and offices) as part of its long-termSociety at Business Sites(Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

039

GRI 302-1/305-4/305-5

Materiality

Achieving a Decarbonized Society	Contributing to a Decarbonized

Hitachi Sustainability Report 2023

Assurance

CO2 Emission Reductions at Business Sites (Factories and Offices) and Hitachi Carbon Neutrality 2030

In working toward realizing a decarbonized society, Hitachi has set the goal of realizing carbon

Contributing to a Decarbonized Society
Through the Decarbonization BusinessGovernanceContributing to a Decarbonized Society at Business Sites (Factories and Offices)

Environmental GovernanceAchieving a Decarbonized Society

Socialenvironmental targets called Hitachi Environmental Innovation 2050.
Our roadmap to achieving this goal sets targets of reducing CO2 emissions by 50%, compared to the base year, by fiscal 2024 and 80% by fiscal 2027 toward realizing carbon neutrality
by fiscal 2030.
CO2 emissions reduction measures at Hitachi include installing energy-saving and renewable energy equipment, engaging in corporate PPA*1 to procure renewable energy with­additionality* , and procuring renewable energy and renewable energy certificates* . Among2

3these, installing energy-saving and renewable energy equipment is expected to incur highcosts relative to the amounts of reduction. However, it will also lead to reduced risks associ-CO2 reduction roadmap (as of Mar. 2023)
Reduction rate in CO2 emissions (%)

Environmental

Management

0

Target50%+

FY2024 Target

50%
50

FY2027 Target

Renewable energy
procurement(purchases +certificates)
36%
Neutralization 10%

Residual emissions
100
2010

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

33%
Corporate PPA
21%

80%

ated with factors including anticipated sharp rises in energy pricing and increased costs fromEnergy saving +RE generation

2030 (year)

carbon taxes and the expansion of carbon tax transactions. It also aligns with our Corporate
Mission—“To contribute to s­ ociety through the development of superior, original technology
and products”—and for this reason as well, we are placing a priority focus on this approach.

Concrete efforts to achieve carbon neutrality at business sites, categorized by location
type (factories, offices), can be outlined as shown below.

Currently, we have set the target at a 33% reduction to be made by fiscal 2030, however weare working to increase that level to 50%.
*1 Corporate PPA: A contract whereby a corporation, municipality, or other legal entity purchases electricity generated by renewable energy from a power producer on a long-term basis (usually 10 to 25 years). PPA stands for power purchase agreement.
*2 Additionality: An increase in effect of installing new renewable energy equipment.
*3 Renewable energy certificate: Accredits the environmental value associated with electricity generation from renewable energy
sources. Unlike the purchase of renewable electricity, acquisition of this environmental value, which is separate from theelectricity itself, is regarded as equivalent to using energy sources that do not emit CO2.

Major Initiatives for Reducing CO2 Emissions at Business Sites (Factories and Offices)• Improve equipment efficiency by introducing and upgrading to high-efficiency equipment(Determine priority measures and manage introduction and upgrade rates)

Factories

Offices• Improve production efficiency and energy use efficiency during production through use of theLumada platform and production technologies cultivated from our long years of experience• Optimize equipment operations and reduce wasted energy by installing smart meters• Review product designs and processes• Optimize control of equipment operations in response to production conditions• Build/move to new facilities with high energy efficiency• Combine and integrate existing facilities• Install energy-saving equipment and optimize equipment operations in collaboration withbuilding owners

Factories
and offices• Install renewable energy systems• Procure electricity from renewable sources• Utilize renewable energy certificates• Utilize renewable energy through corporate PPA• Engage in capital investment to reduce CO through the use of Hitachi Internal Carbon Pricing (HICP)
2

Introduction

Environmental
Environmental

Management

Social Innovation

The Hitachi Internal Carbon Pricing
Framework
SystemEnvironmental

SocialGovernance040

Hitachi Sustainability Report 2023

Assurance

Achievements in Fiscal 2022
Hitachi uses the HICP system to reduce CO2 emissions by converting CO2 reduction benefits of projects to a monetary
values to encourage additional investment, where such projects may not have received investment under the previous mea-

Advancing Our Environmental Vision andLong-Term Environmental Targets

To promote CO2 reduction at its business sites (factories andoffices), in fiscal 2019 Hitachi introduced the Hitachi Internal

In fiscal 2022, monetary investments decreased due to the deconsolidation of materials and construction machinery

Environmental Governance

Carbon Pricing*1 (HICP) framework. Referencing emissions

companies. However, we raised the carbon price from 5,000 yen/t-CO2 to 14,000 yen/t-CO2, resulting in 94 adopted projects

Achieving a Decarbonized Society

trading and carbon taxes globally, we establish internal carbon

and 2,519 t-CO2 in CO2 reductions, nearly twice as much as in fiscal 2021.

Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization Business	Contributing to a DecarbonizedSociety at Business Sites(Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

prices, convert into monetary value as the effect of CO2

surement standard.

We will continue to use HICP, raising the carbon price as necessary to reduce CO2 emissions.

reductions due to investment in equipment that contributes todecarbonization. We add this price to the value of energy
reduction effects, and use the result to evaluate the impact of
our investment. By applying incentives like these, we aim tofurther expand our investment in equipment that contributes
to decarbonization.
Increased burdens from carbon taxes and new emission
regulations can be anticipated in the future. Taking such risk

Hitachi Internal Carbon Pricing (HICP) Framework
Approach to Assessing Investment Effectiveness with HICP
CO2 reduction effects areconverted into monetary value
and added virtually

Investment effect inmonetary terms

factors into account from the stage of equipment investment

Asset values
increaseconsiderations and making investments that contribute todecarbonization a higher priority will help minimize the impactsof future climate change risks and make our company more

CO2
reductioneffects

resilient. The introduction of the HICP framework is instrumental in this process.

Virtual effects are
realized when
Investments areassessedsideration of 2025 carbon taxes and carbon trading prices
the rate to 14,000 yen/t-CO2 in August 2021 in considerationof anticipated carbon taxes and carbon trading prices. We

EnergyreductioneffectEnergyreductioneffectwill leverage this framework to provide early responses to

BeforeAfter

future risks such as carbon taxes as well as to actively pro-

Beforeintroducing HICP

After
introducing HICP

mote the installation of energy-saving and renewable energy
equipment, our highest priority initiative aimed at achievingcarbon neutrality.
*1 Internal carbon pricing: An in-house tool for assessing in monetary terms theamount of carbon generated or reduced in order to voluntarily make investment
decisions and conduct risk management.
*2 ETS: Emission Trading Scheme

Category

FY2019FY2020*1

FY2021*1

FY2022*1

Number of HICP
Projects

35

22

59

94

Investment(Million (JPY))

260

250

1,464

1,185

1,356

447

1,230

2,519

CO2 Emissions
Reduction (t-CO2)

The HICP rate: ¥5,000/t-CO2 ¥14,000/t-CO2
August 2021
*1 Excluding an energy-related company which became a consolidated subsidiaryin fiscal 2020

Initially, we set the HICP rate at 5,000 yen/t-CO2 in con(ETS*2). Subsequently, looking ahead to 2030, we increased

HICP Implementation Results

CO2 reduction = cost reduction
Facilities that generate less CO2 have higher asset values

Introduction

Environmental

Management

Activities and Achievements

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental Governance

The Hitachi Environmental Action Plan for 2024 describes atarget of the total CO2 reduction rate at business sites (factoIn fiscal 2022, which was the first year of the Environmental
Action Plan for 2024 (fiscal 2022–2024), we achieved a 40%

Achieving a Decarbonized Society

reduction in total CO2 emissions compared to a target of 32%	Contributing to a DecarbonizedSociety at Business Sites(Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society

Power plants
North America

reduction (compared to a base year of fiscal 2010). To reduce
emissions, we improved facility efficiency through new andupgraded high-efficiency equipment, installed renewable energy

5,000

4,973

4,000
3,000

40
reduction

Environmental Data%

CO2 Emissions*1

Target rate: 32%

100%

57
15

Governance236

To reduce CO2 emissions, Hitachi installs renewable energy

572

cure electricity produced through new renewable energy

8330

equipment located off-premises. We are expanding the use of
3,296

56
18

3,384

1,003

1,039

360

364
185

1,448

derived electricity with electricity derived from renewableenergy sources.

178

1,563

1,538
385

73
43

set by the GHG Protocol.

197

226

2020

180

2021

174

2022*1*2 (FY)

*1 Energy-derived CO2 emissions in fiscal 2022 amounted 459 kt-CO2 (Scope 1)
and 1,079 kt-CO2 (Scope 2, market basis)*2 Fiscal 2022 CO2 emissions of an energy-related company and auto parts-­
related companies, which became consolidated subsidiaries in fiscal 2020, areincluded in the figures above. The materials and construction machinerycompanies were deconsolidated, and the amount of CO2 emitted by thosecompanies in fiscal 2022 was not included. This resulted in a significant
decrease in the total CO2 emissions.

P.063 Environmental Load from Operations

60%

Renewable electricity used will be based on the standards

533
228

2019

P.061 GHG Emissions Throughout the Value Chain
CO2 Emissions

corporate PPA to accelerate the replacement of fossil fuel-­

44
16

133
2,030

554

Achievements in Fiscal 2022
Renewable electricity generation across the HitachiGroup in fiscal 2022 amounted to 706 GWh, anincrease of 3.7 times compared to fiscal 2021. The
amount of renewable electricity used by the HitachiGroup in fiscal 2022 increased significantly from 4% in
the previous fiscal year to 24%.
At 57 sites the United States, Europe, China, Japanand some other countries in Asia, all electricity usedcame from renewable sources. Eleven of these sites
achieved carbon neutrality through enhanced energy-­savings and purchases of credits for neutralization.
In addition, Hitachi Energy is working actively to

FY2010

FY2022(Base year)
Note: Regarding CO2 electrical power conversion factors: We used adjusted conversion factors forindividual power businesses based on the Act on Promotion of Global Warming Countermeasures
in Japan. In China, we used the average emissions factor published by the government for thenational power grid. For other countries, we used the latest values for each fiscal year supplied by
the International Energy Agency (IEA) for individual countries and by power supply companies.
Note: The Environmental Action Plan’s management values do not include amounts for our power plants
in fiscal 2010 (base year) or fiscal 2022
Note: Only for Environmental Action Plan for 2024 management values, emissions of 11.6 kt-CO2 fromthe cancellation of credits for neutralization were deducted from Scope 1. For the figures that
underwent independent assurance, emissions from the cancellation of credits for neutralization
were not deducted.
*1 CO2 emitted from the organization (Scope 1 and 2).

041

Activities

ASEAN, India, Other Asia

2,285

2018

Hitachi Sustainability Report 2023

Introduce Renewable Energy

264

1,000

Assurance

power generation equipment on our property. We also pro4,374

540

2,000

Environmental Action Plan for 2024 Management Values

Compared With Base Year

China
Other

1,167

0

Reduction Rate of Total CO2 (Hitachi Group)

Japan
Europe1,286

equipment, and procured electricity from renewable sources.

Achieving a Harmonized Society with Nature

Social(kt-CO2)

ries and offices).

Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization Business

Environmental

CO2 Emissions (Hitachi Group’s factories, offices,and power plants)
GRI 302-1/305-4/305-5

Activities

Environmental

Social Innovation

decarbonize operations through the use of non-fossil
fuel electricity for all of its in-house electricity usage.

Introduction

Environmental

Management

Carbon Neutrality

Contributing to a Decarbonized Society
Through the Decarbonization Business	Contributing to a DecarbonizedSociety at Business Sites(Factories and Offices)
Climate-related Financial Information Disclosure(Based on TCFD Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

GovernanceFiscal 2022 reduction measures focused on improving
loading efficiency for product transportation, utilizing joint

3 sites (Hitachi Energy Group)
1 site (Hitachi Astemo Group)

9 sites

1 site (Hitachi Industrial Equipment
Systems Group)

China

6 sites

1 site (Hitachi Industrial Equipment
Systems Group)

tion in Japan totaled 26.9 kt-CO2Japan

3 sites

3 sites (Hitachi High-Tech Group)

Asia (Excluding
China and Japan)

kt-CO2, or 64%, compared with fiscal 2021.

7 sites

2 sites (Hitachi Energy Group)

Other

8 sites

North America

Assurance

Achievements in Fiscal 2022

24 sites

EuropeEnvironmental GovernanceAchieving a Decarbonized Society

Social

Hitachi Sustainability Report 2023

042

Hitachi Fleet Management

Sites Using 100% Renewable-Derived Electricity

Environmental

Achieving a Decarbonized Society

Environmental

Locations operating on non-fossil energyCountry/Region

Advancing Our Environmental Vision andLong-Term Environmental Targets

Social Innovation

VehicleVisualization

Centralized fleet management via BPO
AI drive recorders to monitor vehicle operation statustransportation, and optimizing transportation vehicles.
With the deconsolidation of the materials and construction machinery divisions, CO2 emissions from transporta, a decrease of 47.4

Analysis of vehicle operation status and travel routes
Vehicle Data
AnalysisAnalysis of driver tendencies
Continuous monitoring of electrification rates andCO2 emissions—

Case studies of Energy Savings in Eco-Factories & Offices
https://www.hitachi.com/environment/casestudy/index.html#case02

Hitachi Fleet Management Reduces
CO2 Emissions From Business Vehicles
Approach

Reducing Transportation Energy
Consumption
Activities

Hitachi is preparing to electrify our fleet of commercial­vehicles as part of efforts to achieve carbon neutrality byfiscal 2050. However, we must address a variety of issues
that companies face when introducing electric vehicles,

In addition to reducing energy used at our business sites

including the limited choice of electric vehicles and the lack(factories and offices), Hitachi strives to reduce energy usageof charging infrastructure.

during transportation. Each business unit (BU) and GroupTo this end, we created our own fleet management plan tocompany incorporates the rate of reduction in transportation

prepare for fleet electrification at each BU and Group company.

energy use per unit in Japan, with voluntary targets estab-Specifically, we intend to use BPO*1 and AI drive recorders*2 tolished in other countries.

visualize vehicle operating conditions, followed by an analysis of

Our business sites pursue modal shifts to highly efficientcollected driving data and CO2 emissions monitoring. We willtransportation methods by improving truck loading ratios,

use the results of this analysis and monitoring to act to reducetaking other measures to reduce transportation energy

CO2 emissions from existing vehicles and advance the gradual­consumption and switching to the use of eco-cars for

replacement of existing vehicles with electric vehicles to reduce

in-house operations.

CO2 emissions from business-use vehicles.
*1 BPO: Abbreviation of business process outsourcing. BPO outsources theentirety of a business process to a contractor specializing in said activity.
*2 AI drive recorder: A service that uses AI to analyze recorded driving video andvisualize signs of dangerous driving and driver tendencies.

Optimize the number of vehicles in the fleet basedon vehicle utilization status
Actions to
Reduce CO2Emissions

Encourage eco-driving by controlling sudden
acceleration and braking
Fostering awareness of CO2 reductions via
visualizations of emissions
Phased-in vehicle electrification in consideration of
impact on operations

Introduction

Environmental
Environmental

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

043

Climate-related Financial Information Disclosure (Based on TCFD Recommendations) GRI 3-3
In June 2018, Hitachi announced its endorsement of theinformation disclosure and disclosed information with appro-

Advancing Our Environmental Vision andLong-Term Environmental Targets

recommendations by the Financial Stability Board’s (FSB) Task

priate investment decisions by financial institutions andForce on Climate-related Financial Disclosures (TCFD). The

others. We participated in the consortium as a Steering

P.035 Environmental Strategy for Achieving a Decarbonized Society

Environmental Governancefollowing contains key climate-related financial information in

Committee member and contributed to the formulation ofline with the TCFD’s recommendations.

TCFD Guidance 3.0, published in October 2022.

P.039 Contributing to a Decarbonized Society at Business Sites(Factories and Offices)Achieving a Decarbonized Society
Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

Seven institutions rated the Hitachi TCFD disclosures
highly in the Excellent TCFD Disclosure, announced in
March 2023, as selected by the Government Pension

Identification and Assessment of Climate-related
Risks and Opportunities

P.015 Framework for Promoting Sustainability Strategy
P.031 Framework for Promoting Environmental Governance

The Hitachi Group operates a broad array of businesses

Investment Fund of Japan (GPIF) domestic equity investment
management institutions.

GovernanceP.027 “Environmental Vision” and “Hitachi Environmental Innovation
2050”

around the world with each business having its own set ofStrategy
Approachrisks and opportunities. We are responding to the impact of
GRI 201-2

climate change by assessing climate-related risks and opportunities in accordance with TCFD classifications. We makeIn fiscal 2016, under our Environmental Vision and considering

sector-specific assessments of risks and opportunities for

the Paris Agreement, the RCP2.6 Scenario*1, and RCP8.5

important business sectors that have a relatively high likeli-

Hitachi sees climate change and other environmental issues

Scenario*2 of the Fifth Assessment Report of the IPCC,

hood of being affected by climate change. Our assessments

as important management issues.

Hitachi created Hitachi Environmental Innovation 2050, long-

are also categorized according to time span, namely shortterm environmental targets and a transition plan toward aterm, medium term, and long-term as defined below.

Structure

Important matters concerning the Group’s sustainability
strategy, including climate change measures, are discussed,

decarbonized society. In this way, we intend to meet the con-and decided on by the Senior Executive Committee and are

tributions required of a global company toward the creation ofpresented to the Board of Directors according to necessity.

a decarbonized society. Moreover, to help limit the global

Hitachi reviewed long-term environmental targets, termed

temperature rise to 1.5°C as recommended in the IPCC 1.5°C

Hitachi Environmental Innovation 2050, which include reduc-special report, in fiscal 2020, we revised our target to achieve

ing CO2 emissions. Our Board of Directors receives a reportcarbon neutrality at Hitachi factories and offices by fiscal

regarding these targets when formulated or revised. In addi-

2030. In fiscal 2021, we revised our target once more totion, the Audit Committee of independent directors conducts

achieve carbon neutrality in our value chain by fiscal 2050.

an audit of sustainability-related operations once a year, andThis goal is in line with the SSP1-1.9 scenario*3 of the Sixth

Hitachi executive officers report on climate-related issues toAssessment Report of the IPCC. Hitachi is committed tothe committee during the audit.

contributing to the creation of a decarbonized society on a

As for TCFD initiatives we conduct outside the company,
Hitachi has participated in the TCFD Study Group on Green
Finance and Corporate Disclosures arranged by Japan’s
Ministry of Economy, Trade and Industry (METI) since 2019.
In addition, we have participated in the TCFD Consortium,
which holds discussions on efforts to link effective corporate

Time Spans for Assessing Climate-related Risks andOpportunities
Time span

Reason for adoption

Short
term

Over the next
three years,
from fiscal
2022 to 2024

Corresponds to the three-year management period covered by the Environmental
Action Plan for 2024 established in linewith the 2024 Mid-term Management Plan

Mediumterm

Through fiscal
2030

Time span of our fiscal 2030 long-term
environmental targets

Long
term

Up to fiscal
2050

Time span of our fiscal 2050 long-term
environmental targets

global scale by declaring and pursuing higher goals.

Degrees of Impact*1 A Representative Concentration Pathway (RCP) scenario under which, at the endof the 21st century, the increase in global temperatures from preindustrial levels is
kept below 2°C.
*2 An RCP scenario that assumes that emissions will continue to rise resulting in an
approximately 4°C rise in global temperatures compared to preindustrial levels.
*3 SSP1-1.9 scenario: Presented in the Sixth Assessment Report of the IPCC. A
scenario that limits temperature increase to less than 1.5°C under sustainable
development.

ImpactDefinition

Major

Has an impact sufficient to disrupt business or cause it
to substantially decrease or increase

MediumPart of the business is impacted

Minor

There is little impact

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceContributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)
Achieving a Resource-Efficient Society

Environmental

Social Innovation

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

044

Responding to Climate Scenario Risks and Opportunities for Each Business
Hitachi operates a broad array of businesses with each business having its own set of risks and opportunities. We therefore selected businesses that have a relatively high likelihood of being affected byclimate change and conducted scenario analyses. In selecting businesses, we considered the factors of, high sales volume within the Group, and relatively high need for fossil fuels when products andservices are used, as well as high CO2 emissions.
The businesses we selected using these criteria were railway systems, power generation and power grids, IT systems, and industrial equipment. For each of these businesses, we considered thebusiness environment under the 1.5°C and 4°C scenarios and how we would respond.
● 1.5°C scenario As projected by the IPCC’s RCP 2.6 climate model, the IEA 450 Scenario, and other scenarios, we are anticipating a world where stringent measures and regulations will be implemented to help realize a decarbonized society. Therefore, we investigated risks and opportunities on the premise of carbon neutrality by fiscal 2050.

Achieving a Decarbonized Society
Achieving a Decarbonized SocietyManagement● 4°C scenario

We focused on there being increased climate-induced natural disasters as a result of lax regulations as projected by the IPCC’s RCP8.5 scenario and other scenarios.

Our assessment of the major risks and opportunities for the selected businesses are outlined in the following table.
The Business Environment, Major Risks and Opportunities, and Strategies under the 1.5°C and 4°C Scenarios
Target businesses

Railway systems

The businessenvironment andmajor risks andopportunities
under the 1.5°C
scenarioBusiness environment

Business environment

Business environment

Business environment

Global demand will continue to grow for railway
transport systems that emit relatively less CO2 per
distance covered will grow with tighter CO2 emission regulations in each country and region.

Global demand will continue to grow for electricity
from non-fossil sources, such as renewable energy
and nuclear power, with tighter CO2 emission
regulations in each country and region. Power
networks will increasingly accommodate renewableenergy produced through distributed power
generation.

Demand for energy-saving, high-efficiency IT
solutions will grow with tighter CO2 emission regulations in each country and region. There will also be
increased demand for data centers and data
analysis systems to accommodate the expansion offinancial services such as investments and loans for
decarbonization businesses, green bond issues,and data utilization businesses.

Global demand for energy-saving industrial equipment will grow with tighter CO2 emission regulations
in each country and region.

Achieving a Harmonized Society with Nature
Environmental Data

Power generation and power grids

IT systems

Industrial equipment

Risks

Risks

Risks

Risks

A decline in competitiveness in the railroad sector if
there are delays in the development of innovativetechnologies of the type expected to contribute to the
reduction of CO2 emissions. Specifically, delays in thedevelopment of new technologies such as dynamic
headways (flexible operations based on passenger
demand) and support for new mobility services (e.g.,
MaaS). Also, a decline in competitiveness due todelays in the timely marketing of effective and sustainable products that comply with increasingly
stringent laws and regulations for decarbonization.

A decline in competitiveness due to delays in thedevelopment of technologies for the transmission of
more renewable energy without compromising thestability of the transmission grid or the quality ofelectricity. A lack of international and regional
cooperation to maintain a balance between supply
and demand in the power grid for renewable energy
generation having large output fluctuations, resulting delays in renewable energy utilization.

Competitiveness will decline if there is a lack oftechnological and human resource development toprovide energy-saving and highly efficient IT solutions and if decarbonized measures for energy-­
intensive data centers are delayed.

Competitiveness will decline if there are delays inthe development of high-efficiency, low-loss
products.

Opportunities

Opportunities

Opportunities

Opportunities

A transition of most long-distance public transportation to the railway sector under the 1.5°C scenario,
since rail is a mode of transportation that contributes
to decarbonization with low CO2 emissions per unit oftransportation. Expanded business opportunities bydeveloping and delivering railroad cars that are moreenergy efficient than existing models, by converting tobi-mode railroad cars, and by increasing the efficiencyof rail services with digital technology.

Expanded business opportunities in conjunction
with rising demand for renewable energy—the key
to a decarbonized future—and with the development of grid solutions, digital service solutions, andenergy platforms that can accommodate thediversification of energy suppliers.

Demand will grow for energy saving and high-­
efficiency information systems that contribute tozero-emissions. There will also be increased
demand for environment-related financial services
as investments and loans for decarbonization
businesses and green bond issues.

Utilization of IoT, digitalization, and connected
systems to develop innovative products and solutions that contribute to CO2 emission reductions
without relying on the energy-saving features ofindividual products.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

Environmental

Social Innovation

SocialGovernanceTarget businesses

Railway systems

The businessenvironment andmajor risks andOpportunities
under the 4°C
scenarioBusiness environment

Business environment

Business environment

Business environment

Demand for electric-powered transport will gradually increase even without tighter energy regulations. Damage from typhoons, floods, and othernatural disasters caused by climate change will rise
sharply.

The cost competitiveness of non-fossil energy will
increase as fuel prices gradually increase due toincreased fossil energy consumption, and demand
for renewable energy and nuclear power will
increase moderately. Natural disasters caused byclimate change will rise sharply. Needs will increase
for climate adaptation to protect electric energy
systems from extreme weather events.

Demand for new, high-efficiency technology will
expand as multiplex IT systems in response tonatural disaster BCPs will result in increased energy
consumption. Demand will also grow for social andpublic systems to reduce damage from natural
disasters.

Typhoons, floods, and other natural disasters
caused by climate change will rise sharply.

Environmental GovernanceAchieving a Decarbonized Society
Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)

Environmental Data

Non-environmental
market factors(neither the 1.5°C
nor 4°C scenario)

Industrial equipment

Risks

Risks

Risks

Risks

The high frequency of natural disasters will increase
damage to power generation and transmission/
distribution facilities, hamper efforts to restore powertransmission/distribution, and disrupt supply chainsleading to delays in deliveries and the procurementof parts. Increased delays in the development andprovision of power generation, transmission, anddistribution equipment, facilities, and services
capable of withstanding frequent natural disasters.

Natural disasters will exacerbate damage to production facilities, worsen working environments,
and disrupt supply chains leading to delays indeliveries and the procurement of parts.

Natural disasters will exacerbate damage to production facilities, worsen working environments,
and disrupt supply chains leading to delays indeliveries and the procurement of parts.

Disclosure (Based on TCFD
Recommendations)
Achieving a Harmonized Society with Nature

IT systems

045

The high frequency of natural disasters will exacerbate damage to production facilities, worsen
working environments, and disrupt supply chainsleading to delays in deliveries and the procurementof parts.

	
Climate-related Financial Information

Achieving a Resource-Efficient Society

Power generation and power grids

Hitachi Sustainability Report 2023

Assurance

Opportunities

Opportunities

Opportunities

Opportunities

Transport systems more resilient to natural disasters
can be developed. Competitiveness can beenhanced by providing added value in such forms
as energy-saving railcars and adaptability to newtechnologies.

Energy demand will grow as warmer weather leads
to increased use of air conditioning. Demand will
increase for disaster-resilient power generation andtransmission/distribution technologies. Increase thecompetitiveness of existing power transmission anddistribution systems by making these systems more
resilient to extreme weather conditions.

Demand will increase for social and public systems
that help reduce damage from natural disasters andfor IT systems required as part of BCP.

Efforts to accommodate IoT products will lead tohigher demand for remote control and remote
maintenance during natural disasters.

● Economic growth will lead to urbanization andpopulation growth around the world which will
drive the railway business globally as an efficient
form of public transport for large numbers ofpassengers regardless of climate conditions.
Market size in Japan and Europe will remain flat,but the Asian market overall will see substantial
growth.
● Long-distance transport will decline going forward as the global pandemic restricts travel andencourages remote work. Although the decline indemand will not be as severe as that for airtransport.
● Competition will grow as major railway manufacturers in various countries will expand theirbusinesses to meet global demand.

● Economic growth, urbanization, and population
growth will push up demand for energy, especially electricity, mainly in developing countries.
● Political trends in each country and region related
to climate change and energy issues, andchanges in public awareness.
● Energy supply and demand will diversify due tovarious factors, such as CO2 emissions, theenvironmental burden, economic performance,
safety, and supply stability.
● Digital technology will develop further to enhance
the stability and efficiency of the power supply.

● Further digitization globally will exponentially
increase the volume of data circulated, accumulated, and analyzed. Experience with the global
pandemic will prompt a shift to remote, noncontact, and online formats, both in our life and work
and will boost demand for digital solutions thatfacilitate such a shift.
● New services and businesses utilizing big data,
IoT, AI, and other digital technology will expand.

● Digitalization, infrastructure renewal, population
decline, and worker shortages will expand theautomation market in industrial countries.
● As the global pandemic forces people to stay ator work from home, demand will grow for factory
automation enabling a handful of workers tooperate a factory.
● The industrial market in emerging economies willgrow due to a rise in production plants.

Introduction

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

046

Environmental

Target businesses

Railway systems

Power generation and power grids

IT systems

Industrial equipment

Environmental

Response to futurebusiness risks(business
opportunities)

Response to business risks under 1.5°C or 4°C
scenarios

Response to business risks under 1.5°C or 4°C
scenarios

Response to business risks under 1.5°C or 4°C
scenarios

Response to business risks under 1.5°C or 4°C
scenarios● Continue to strengthen the railway business as
global demand for railways will increase undereither scenario.
● Specifically, develop and market more energy-­saving railcars and battery powered railcars for
non-electrified sections. Strengthen railway
services through digital utilization such as
dynamic headway (flexible operations in
response to passenger demand) and new mobility services like MaaS.
● Increase competitiveness by strengthening
sustainable activities while adhering to international standards, etc.
● Given the increasing frequency of natural disasters, take risk aversion into account when deciding the location and equipment layout of a newplant. Keep an eye on the supply chain instrengthening our ability to respond to businessdisruption risks in accordance with our BCPs.
Evaluate and analyze organizational structuresand physical locations and reflect the results ofthis work in response measures.

● Continue to enhance the response to relevantmarkets in view of expected higher demand fornon-fossil energy under either scenario.
● Strengthen the provision of grid solutions, digital
service solutions, and energy platforms that canaccommodate the increased use of renewableenergy and diversification of energy supply anddemand management.
● Given the increasing frequency of natural disasters, develop technologies for disaster-resilient
renewable energy systems and disruption-­
resistant power transmission/distribution systems. Take risk aversion into account when
deciding the location and equipment layout of anew production plant. Keep an eye on the supply
chain in strengthening our ability to respond tobusiness disruption risks in accordance with our
BCPs.

● Continue to develop innovative digital technologies, nurture necessary human capital, andenhance digital service solutions that generate
new value in view of the expected growth indemand for digital services and the subsequent
market expansion under either scenario.
● Specifically, enhance competitiveness by providing energy-saving and high efficiency IT solutions
that contribute to the following: zero-emissions;environment-related financial services for decarbonization businesses; social and public systems
to prevent natural disasters, reduce damage, andenhance resilience; and IT systems for BCPs.
● Given the increasing frequency of natural disasters, strengthen our ability to respond to business disruption risks in accordance with our
BCPs.
● Ensure competitiveness by decarbonizing data
centers actively.

● Under either scenario, continue developing
energy-saving, high efficiency products that use
IoT technology. Focus particularly on connected
products with communication features.
Miniaturized, high-efficiency, low-loss products
can also help reduce CO2 emissions.
● Given the increasing frequency of natural disasters, take risk aversion into account when deciding the location and equipment layout of a newplant. Keep an eye on the supply chain instrengthening our ability to respond to businessdisruption risks in accordance with our BCPs.

Partial impact on the revenue of the Railway
Systems Business, which accounted for approximately 6.8% of Hitachi’s revenue at 736.0 billion
yen in fiscal 2022

Partial impact on the revenue of the Energy Sector,
which accounted for approximately 16.4% of
Hitachi’s revenue at 1,787.6 billion yen in fiscal
2022

Partial impact on the revenue of the Digital Systems& Services Segment, which accounted for approximately 22.0% of Hitachi’s revenue at 2,389.0 billion
yen in fiscal 2022

Partial impact on the revenue of the Industrial
Products Business , which accounted for approximately 4.1% of Hitachi’s revenue at 451.1 billion
yen in fiscal 2022

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceAchieving a Decarbonized Society
Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

Financial information (sales volumeof each target
sector)Note: The above scenario analyses are not future projections but attempts to examine our resilience to climate change. How the future unfolds may be quite different from any of these scenarios.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

Environmental

Social Innovation

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

047

Climate-related Risks (Hitachi Group)
Based on a business-by-business review, Hitachi did not find any significant climate change-related risks that were difficult to respond to risks that present difficulties in response.
When considering whether existing businesses will be viable when a decarbonized society is realized, many businesses that use electricity as their energy must be able to adapt to a decarbonizedsociety by replacing the electricity they use with electricity derived from non-fossil energy sources. On the other hand, businesses that currently use fossil fuels will need to adapt to a decarbonizedsociety by adopting new technologies such as hydrogen and biomass, as well as various measures to offset CO2 emissions. Since many of Hitachi’s businesses use electricity, it is clear that there is little
significant risk arising from the unavailability of fossil fuels.

Environmental GovernanceAchieving a Decarbonized Society
Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)

The following is a summary of Hitachi’s overall risks under the 1.5°C scenario and the 4°C scenario. Given Hitachi’s business format, we have determined that these risks related to climate change canbe addressed.
① Risks related to the transition to a decarbonized economy (applying mostly to the 1.5°C scenario)
Category

Time span

ImpactMain initiatives

Policy and legal

Increased business costs from the introduction ofcarbon taxes, fuel/energy consumption taxes,
emissions trading systems, and other measures

Short to long term

Medium● Shift from fossil fuel-using to non-fossil fuel-using businesses. Promote activities aimed at achieving carbon
neutrality.
● Avoid increases in business costs by further enhancing production and transport efficiency and promoting theuse of non-fossil fuel-based energy. Promote energy-saving equipment by introducing Hitachi Internal Carbon
Pricing (HICP)

Technology

Loss of sales opportunities due to delays intechnology development for products and services for a decarbonized society

Short to long term

Medium● Contribute to reducing CO2 emissions by developing and marketing innovative products and services that lead tothe achievement of long-term environmental targets and expanding the decarbonization business● Promote the development of energy-saving and low-carbon products by implementing Environmentally
Conscious Design Assessments when designing products and services

Market and reputation

Impact on sales due to changes in market values
or assessment of our approach to climate issues

Medium to long term

Minor

● Established goals of carbon neutrality in the Hitachi Environmental Innovation 2050 long-term environmental
targets; participated in COP26 and communicated to the world advanced technologies and initiatives that support the realization of a decarbonized societyTime span

ImpactMain initiatives

Short to long term

MediumAchieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Major risks

Environmental Data

② Risks related to the physical impacts of climate change (4°C scenario)
Category

Acute and chronic
physical risks

Major risks
Climate-related risks to business continuity
including increased severity of typhoons, floods,
and droughts (acute risks), as well as rising sea
levels and chronic heat waves (chronic risks)● Considering the possibility of flood damage when deciding on the location or equipment layout of a new plant;measures tailored to the water risks of each manufacturing site will be strengthened in the future based on the
results of a water risk assessment now being conductedIntroduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceAchieving a Decarbonized Society
Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

Climate-related Opportunities (Hitachi Group)
To achieve the CO2 reduction targets set forth in our long-term environmental targets and 2024 Mid-term Management Plan, it is important not only to decarbonize our business sites (factories andoffices), but also to reduce CO2 emissions from the use of products and services sold, which account for a large portion of emissions in our value chain. Developing and providing products and services
that emit zero or very little CO2 during their use will not only satisfy customer needs, but also help meet society’s demands for reduced emissions. This represents a business opportunity for us in the
short, medium, and long terms, and constitutes a major pillar of the Social Innovation Business that we are promoting as a management strategy.
Category

Major Opportunities

ImpactMain initiatives

Services and Markets
for Products

Increased corporate value and revenue fromexpanded sales of products and services with
innovative technology that can contribute to themitigation and adaptation of climate change

Major● Expand business areas that contribute to decarbonization.
● Promote decarbonized solutions and services through collaborative initiatives with customers.
● Focusing on the fields of energy, mobility, and connective industries we pursue the greater utilization of digital technology (Green by Digital)and develop products that offer world-class efficiency.

Resilience

Provision of solutions to address climate-related
natural disasters

Medium● Providing flood simulators and evacuation/emergency operation support systems● Providing disaster prevention solutions such as high-performance firefighting command systems

P.036 Expanding the Decarbonization BusinessP.054 Products and Services that Contribute to Resolving Water Issues

P.056 Addressing Risks Related to Water and Biodiversity

Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data048

The results of these studies indicate that Hitachi has not uncovered any significant or difficult-­toaddress climate change-related risks at this stage. We believe we can view our contributions toclimate change action as opportunities. Hitachi believes that we have high resilience in the transition to a decarbonized society in the medium to long term, as we closely monitor market trends
and develop business flexibly and strategically under both the 1.5°C and 4°C scenarios.

Introduction

Environmental

Management

Social Innovation

Risk Management
Structure

Environmental

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

049

Metrics and Target
Targets

P.013 Reflecting Sustainability Targets in Executive Compensation
Evaluation

Hitachi identifies, evaluates, and manages climate change-­

Hitachi defines medium- to long-term metrics and targets in

Advancing Our Environmental Vision andLong-Term Environmental Targets

related risks by business unit and Group company to deter-

the Hitachi Environmental Innovation 2050 long-term environ-mine environmental impacts and other factors. The results aremental targets. We also establish and manage short-term

Environmental GovernanceP.027 “Environmental Vision” and “Hitachi Environmental Innovation
2050”

tabulated by the Sustainability Promotion Division of Hitachi,

metrics and targets in detail every three years through theP.030 Environmental Action Plan

Achieving a Decarbonized SocietyLtd., and those risks and opportunities perceived as being

Environmental Action Plan.

Achieving a Decarbonized Society
Contributing to a Decarbonized Society
Through the Decarbonization BusinessContributing to a Decarbonized Society at
Business Sites (Factories and Offices)	
Climate-related Financial Information

Disclosure (Based on TCFD
Recommendations)
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data

particularly important for the Group as a whole are deliberated

Metrics for climate change mitigation and adaptation use

and decided by the Senior Executive Committee and, if neces-

total CO2 emissions and the reduction rate in CO2 emissions

sary, by the Board of Directors as well.

per unit. Total CO2 emissions from the use of sold products in
Scope 3, which account for most of our emissions given thenature of Hitachi’s business, fluctuate greatly due to changes
in sales volumes and our business portfolio. This has the
disadvantage of making it difficult to see the results of energy
saving and efficiency improvements. Therefore, we haveestablished CO2 emissions per unit as a metric for providing
customers and society with products and services that offer
equivalent value while emitting less CO2. We also set andmanage a metric for avoided emissions that contribute to therealization of a decarbonized society as a whole.
We continue to reduce CO2 emissions generated at ourown business sites (factories and offices) by utilizing the
Hitachi Internal Carbon Pricing (HICP) system, which provides
incentives for capital investments that contribute to CO2
reductions. The carbon price for HICP is set at 14,000 yen
per ton-CO2.
In addition, in April 2021, Hitachi, Ltd. introduced evaluations that take environmental value into account in the executive compensation system with a view to accelerating thecreation of environmental value toward achievement of longterm environmental targets.

P.035 Achieving a Decarbonized Society
P.036 Expanding the Decarbonization BusinessP.039 Contributing to a Decarbonized Society at Business Sites(Factories and Offices)
P.061 Calculating GHG Emissions Throughout the Value Chain(Fiscal 2022)

Introduction

Management

Social Innovation

Environmental

Environmental

Achieving a Resource-Efficient Society

Environmental

Efforts to Achieve a Resource-Efficient Society

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental Governance

Environmental issues continue to intensify associated with

Achieving a Decarbonized Society

increased economic and social activities within the conven-

Achieving a Resource-Efficient Society

tional linear economy of mass production, mass consump-	Efforts to Achieve a Resource-Efficient
Society
Building a Society That Uses Resources
Efficiently
Building a Water-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Datation, and mass disposal. These problems involve resource
shortages, water scarcity, tight supply and demand forenergy, environmental pollution caused by increasing waste,
global warming, and the loss of biodiversity. To solve these
problems and create sustainable societies, we must shift
away from linear economies to circular economies. Hitachi
works together with customers and society to help build asociety that uses water and other resources efficiently.

SocialApproach

Governance

Hitachi considers the circularity of resources across the value
chain to be of key importance. We also believe in the importance of water usage reduction that takes into consideration

Hitachi Sustainability Report 2023

GRI 2-13/2-24/3-3 Initiatives to Achieve a Resource-Efficient Society

Building a society that uses
resources efficiently

Building a
Water-Efficient SocietyLong-term target

Long-term target

Improve resource use efficiency
by 50% in FY2050(compared to FY2010 level)
Main initiatives at business sites

Initiatives in the Value Chain

Assurance

Enhance
Shift to a circular­ fficiency in theeeconomyuse of resources

Achievinga ResourceEfficient
Society

Improve water use efficiency
by 50% in FY2050(compared to FY2010 level)
Main initiatives at business sites

Respond towater risks

Enhance­efficiency in theuse of water

water risks on a region-by-region basis at each stage of the
supply chain. Accordingly, we drive circular-design initiatives
and development tools, applications, and services that help
facilitate circular economies, and optimize water usage andwastewater treatment in the supply chain, provide water-­efficient products and services.

Initiatives at Business Sites
We established a long-term environmental target to improvethe efficiency with which water and other resources are usedby fiscal 2050. The actual goal is to improve efficiency by
50% compared to fiscal 2010. In addition, we will create
higher economic value using fewer resources while pursuing
production activities with a lower environmental burden.

Note: Our response to water risks that take biodiversity into consideration are detailed in Efforts to Achieve a Society Harmonized With Nature (P.055).

050

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

Social Innovation

Environmental

SocialBuilding a Society That Uses Resources Efficiently

Governance

Hitachi Sustainability Report 2023

Assurance

051

GRI 301-1/301-2/301-3

Approach to Transitioning to a Circular Economy
Approach

Environmental Governance

To help build a society that uses resources efficiently, Hitachi

effective utilization rates related to plastic waste. In particular,

recycling, making continuous efforts to devise strategies forAchieving a Decarbonized Society

will advance a shift from the conventional linear economy to a

we initiated activities targeting all manufacturing sites thisthe most efficient utilization of resources and assets. To thisAchieving a Resource-Efficient Society

circular economy. Therefore, we will focus on how we canfiscal year with the aim of achieving Zero Waste to Landfill*1.

end, we share our goals with various stakeholders in the

products, tools, applications, and services necessary for ourusing three approaches: innovation in upstream productdesign, innovation in the product manufacturing process, and3 Innovation of Business Modelgoals, leveraging the advantages of Hitachi’s IT × Operationalinnovation of our business model.

To adapt to a society that is transitioning from goods toTechnology (OT) × Products to support create circularexperiences, or in other words, from ownership to leasing,­economies not only in our value chain, but in customer

1 Innovation in Product Design

we pursue the effective use of resources and assets through­activities as well.

Through Environmentally Conscious Design Assessments andleasing, pay-per-use systems, subscriptions, products as aLife Cycle Assessments for new products that involve design

service, reuse, and sharing-based models. At the same time,

activities, we will reduce waste by standardizing parts,

we collect used products and consider their sale, repair, orAchieving a Harmonized Society with Nature
Environmental Data

we pursue research and development involving raw materials,

P.038 Improving the Environmental Performance of Products andServices Through Eco-Design

extending service life, utilizing recycled materials, and designing for easy recyclability. To this end, we revised the Hitachi
Eco Design Management Guidelines and Hitachi Eco Design
Activity Guidelines to reflect the latest international trends. At

Approach to Transitioning to a Circular Economy
Heat recovery

Heat recovery

the same time, we set a clear goal to apply the relevant
assessments to all new products involving design activities
and to achieve this goal by fiscal 2024.
2 Innovation in the Manufacturing Process

We share case studies among divisions to highlight initiatives
in this area. Case studies include product and parts manufac-

Procurement
Partners

In-house
Manufacturing
sites

turing volume optimization based on an understanding ofProcessing/
Assembly

established specific targets for the number of sites achieving

Shifting to a circular
economyRecycling

In-house
Manufacturing
sites

Processing/
Assembly
Refurbishment
Reuse

designCustomers

Use

2 Innovation in the

Waste­manufacturing process
3 Innovation of businessmodel

the reduction of defective products through quality improvement, and the reduction of chemical substances. Further, we

Waste
Waste plastic
Toxic
substancesRawmaterials

1 Innovation in productsupply and demand, digitization of design processes forpaperless work, the reduction of packaging material usage,

Procurement
PartnersRawmaterials

Customers

Use
Recycling
Sharing and resale

the goal of the Zero Waste to Landfill initiative, as well as for
Note: Hitachi normally refers to suppliers (including vendors and providers) as procurement partners, with whom we build business together on an equal footing.

In-house collection

Building a Water-Efficient Society

value chain and pursue collaborative creation. Additionally,

Third-party
collection	Building a Society That Uses Resources
Efficiently

ties and reduce waste, or even eliminate waste altogether,*1 Pursued in careful compliance with regulations, conditions, etc., in eachcountry or region

Third-party
collection

Efforts to Achieve a Resource-Efficient Society

continue to use resources and assets in our business activi-

Introduction

Environmental

Management

Social Innovation

Environmental

SocialGovernanceManagement of Waste and Valuables Generated at Business Sites
GRI 306-1/306-2/306-3

Activities

Environmental

We collect environmental load data for waste and valuables*1

Advancing Our Environmental Vision andLong-Term Environmental Targets

generated at the business sites using the Environmental Data

Environmental Governanceof waste and valuables generated and exported by type. For

Achieving a Decarbonized Society

hazardous waste, in particular, we ensure thorough compli-

Achieving a Resource-Efficient Society

ance with laws and regulations, and engage in proper dis-Efforts to Achieve a Resource-Efficient Society	Building a Society That Uses Resources
Efficiently
Building a Water-Efficient Society
Achieving a Harmonized Society with Nature
Environmental Data052

Hitachi Sustainability Report 2023

Assurance

Collection System (Eco-DS) to manage centrally the volumes

Reduction Rate in Waste and Valuables Generation*1 per Unit
(Hitachi Group)16
reduction

Environmental Action Plan for 2024 (fiscal 2022–2024), wea base year of fiscal 2010) for waste and valuables generated. We outperformed this target by achieving a reductionof 16%.

Target: 14%

100%
Amount generated= Activity amount*

2

1,384

1,000

84%

Amount generated= Activity amountWe reduced the amount of waste and valuables gener-

within our business sites, as well as through closed-loop

FY2010

FY2022(base year)

recycling, whereby byproducts and scrap from the production process are reused as resources by other businesssites, while packing and cushioning materials for transportation are used repeatedly.
*1 Waste and valuables: Materials generated through business activities. Eachcountry has a legal definition of waste, and in Japan, the term refers to refuse,bulky refuse, ashes, sludge, excreta, waste oil, waste acid and alkali, carcasses, and other filthy and unnecessary matter, which are in a solid or liquidstate according to the Waste Management and Public Cleansing Law.
Valuables, meanwhile, are those materials left over after business activities
other than waste, and can be sold or transferred free of charge to other parties
as items of value.

12
4

1,302

14
10

1,061
722

656

1,111
9
9

500

130
55

*1 Amount of waste and valuables generated from the production process.
*2 Activity amount is a value closely related to waste and valuables generation ateach business site (for example, output, sales, and production weight).

21
10

613

582
148
56

461

418

2018

2019

100

87
50

49

356
62

38
43
34

311

331

69

2020

2021

2022*20ated by 70 kt, or 23%, compared to the base year. We
accomplished this result by installing recycling facilities

ASEAN, India, and other Asian regions
EuropeOther regions

1,500

%

For fiscal 2022, which was the first year of the

Japan
China
North America(kt)

From base year

posal within the Group.

established a 14% per-unit reduction target (compared with

Waste and Valuables Generation*1 (Hitachi Group)

Environmental Action Plan for 2024 Management Values

109

(FY)

*1 Waste and valuables: Through fiscal 2021, this volume was the amount ofwaste and valuables generated by major business sites. Beginning in fiscal
2022, this volume is the total amount of waste and valuables generated in the
manufacturing processes of all business sites and the amount generated at
offices other than manufacturing processes.
*2 Beginning in fiscal 2022, the report above includes waste and valuables
generated by an energy-related company and auto parts companies in fiscal
2022. Significant decrease due to deconsolidation of materials-related andconstruction machinery-related companies.

P.063 Environmental Load from Operations
Case Studies of Efficient Use of Resources
https://www.hitachi.com/environment/casestudy/index.html#case04

Introduction

Environmental
Environmental

Management

Social Innovation

Number of Sites Achieving the Goal of the Zero
Waste to Landfill Initiative
Activities

Environmental

SocialGovernance

Effective Utilization Rate of Plastic Waste

Assurance

Hitachi Sustainability Report 2023

053

Hitachi Global Life Solutions, whose plastic consumption
accounts for around 70% of the Hitachi Group’s total, uses

Activities

recycled plastic in parts for washing machines and refrigera-

Materiality

We began strengthening our activities in fiscal 2022 toward

tors and packing materials for ceiling lights. The company

Advancing Our Environmental Vision andLong-Term Environmental Targets

We pursue activities to achieve the goals of the Zero Waste toachieving a 100% effective utilization*1 rate of waste plastics

procures recycled plastic materials produced within the

Landfill*1 initiative, which seeks to minimize landfill disposal forthroughout the entire Hitachi Group by fiscal 2030. In fiscal

Hitachi Group, such as plastic parts recovered from end-of-life

Environmental Governancethe ongoing, sustainable utilization of resources. This fiscal

2022, we set an effective utilization rate target of 77% andhome appliances and plastic containers, and also uses recy-

Achieving a Decarbonized Society

year, we set specific targets for the number of manufacturing

achieved 88%. To improve the effective utilization rate, we arecled plastics sourced from other materials manufacturers.

Achieving a Resource-Efficient Societysites to achieve zero landfill waste, and we are stepping up

implementing measures that include design changes for

efforts to accelerate this initiative. In fiscal 2022, 199 of theequipment and products that do not generate waste, digitiza-bases in the lower parts of units, etc.) were previously madesites covered by our activities achieved zero landfill waste.

tion of operations for paperless work, reduction of waste

using a mixture of new and recycled materials, the company

through yield improvements, in-house reuse, sorting andshifted to almost 100% recycled plastics, achieved by solving

accumulation waste to enhance value, and recycling mea-

technical problems and procurement issues.

Efforts to Achieve a Resource-Efficient Society	Building a Society That Uses Resources
Efficiently
Building a Water-Efficient Society

While large components in washing machines (enclosure

Hitachi Global Life Solutions works to recycle four catego-sures through detailed sorting.

Achieving a Harmonized Society with Natureries of end-of-life home appliances (air conditioners, TVs,
refrigerators/freezers, and washing machines/dryers) at 19

Environmental Data
Environmental Action Plan for 2024 Management Values

Number of sites
achieving zero landfill
waste

199


business sites(58% achievement)
FY2022 target:
90 business sites (approx. 25%)

Environmental Action Plan for 2024 Management Values

Effective utilization
rate of plastic waste

88

recycling plants as part of cooperative efforts among fivecompanies*2 in response to the 2001 Act on Recycling of% achievement

Specified Home Appliances. A total of 91.3 kt of recyclable
materials*3 were recovered in fiscal 2022, of which approximately 81.9 kt were recycled. By product type, the recycling

FY2022 target: 77%

rate for refrigerators and freezers was 80% exceeding thelegal requirement of 70% by 10 percentage points, and forwashing machines and dryers it was 94% exceeding the legal

Note: All manufacturing sites are covered*1 Zero Waste to Landfill goal: Defined as a final disposal rate (landfill disposal/
waste and valuables) of less than 0.5% in any given fiscal year in the HitachiGroup. Pursued in assumed conformance with regulations, conditions, etc.

requirement of 82% by 12 percentage points.
*1 Effective utilization encompasses material recycling, chemical recycling, andthermal recovery. Pursued in assumed conformance with regulations, conditions, etc.
*2 Hitachi Global Life Solutions, Sharp Corporation, Sony Corporation, Fujitsu
General Limited, and Mitsubishi Electric Corporation.
*3 Parts and materials recovered from four categories of end-of-life home appliances (air conditioners, TVs, refrigerators/freezers, and washing machines/
dryers) and recycled through in-house use, sale, or transfer free of charge toother entities for use. Data values are aggregated from Hitachi Global Life
Solutions and Johnson Controls-Hitachi Air Conditioning.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceAchieving a Decarbonized Society

Achieving a Resource-Efficient Society
Efforts to Achieve a Resource-Efficient Society
Building a Society That Uses Resources
Efficiently	Building a Water-Efficient Society
Achieving a Harmonized Society with Nature
Environmental DataManagement

Environmental

Social Innovation

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

054

Building a Water-Efficient SocietyManagement of Water Use at Business Sites
Activities

GRI 303-1/303-2/303-5

Materiality

For fiscal 2022, the first year of the Environmental Action Plan
for 2024 (fiscal 2022–2024), we set a target reduction of 22%(compared with a base year of fiscal 2010) in water use perunit for manufacturing process and general daily usage inmanufacturing sites. We improved on this target with a reduction of 27%. We reduced the volume of water used by 11
million m3, equivalent to a reduction of 45% compared withthe base year. Our measures to reduce water usage included
more stringent management of water intake using flowmeters,
installing water pipes above ground for better leakage control,
recirculating cooling water, and reusing purified waste water.

Environmental Action Plan for 2024 Management Values
Reduction in Water Usage*1 per unit (Hitachi Group)

From base year

27
reduction

100%= Activity amount*

FY2010

50
40

37.02

30
20
10

0.26
0.04

36.41

2.45
3.93
1.34

0.35
0.28
2.36
4.09
1.32

29.00

28.01

26.35

0.33
0.36
3.30
1.92
0.95

26.03

0.32
0.21
3.68
1.88
0.87

19.50

14.56

19.08

0

2018

2019

2020

2021

2022*2

0.42
3.57
0.57
0.92
0.90
8.19

*1 Total volume of water used in manufacturing processes and general daily usageat manufacturing sites and in general daily usage at locations other thanmanufacturing sites.
*2 The water usage of an energy-related company included in the scope of consolidation since fiscal 2020 is included in the figures above beginning fiscal 2022.
The water usage for fiscal 2022 by auto parts companies included in the scope of
consolidation since fiscal 2020 is not included in the figures above, but amounted
to 412 million m3. The total water usage was decreased significantly due to thedeconsolidation of the materials- and construction machinery companies.

Case Studies of Improving Water Use Efficiency

73%=

Water usage
Activity
amountFY2022(base year)*1 Total amount of water used in manufacturing process and general daily usageat manufacturing sites.
*2 Activity amount is a value closely related to water use at each business site (forexample, output, sales, and production weight).

Hitachi’s Water-related Products and Services
Activity field
Creating water
resources(FY)

https://www.hitachi.com/environment/casestudy/index.html#case03

Target: 22%2■ Japan ■ China ■ ASEAN, India, and other Asian regions■ North America ■ Europe ■ Other regions(million m3)

P.063 Environmental Load from Operations%

Water usage

Water Usage* (Hitachi Group)1

wide-area monitoring and control system for nine prefectural
water treatment plants. This project involves designing and building a system that monitors and operates facilities centrally via acommon cloud-based platform. The system handles data fromdifferent systems with different specifications supplied by various
vendors, as well as data from software that utilizes Hitachi’s
digital technology. This project will contribute to wide-area control
and management and as digitization (DX) in the water industry.

Products and Services That Contribute to
Resolving Water Issues
Activities

Hitachi is a comprehensive water services provider that has built
a solid track record of experience and expertise in operational
technology (OT), products, and services in the sector. We contribute to the effective use of limited water resources by addressing the many issues facing our customers in the water andsewage treatment business. We achieve these results by leveraging a combination of our IT, extensive experience, and considerable expertise in a variety of fields. A recent example includes
our joint venture with Mizu Mirai Hiroshima Corporation, which
was awarded a contract by Hiroshima Prefecture to build a

Products or services (implementation to date)
Wastewater recycling systems
Seawater desalination systems
Water and sewage treatment, etc.
(over 200 sites in about 40 countries and regions)

Developing water
infrastructure

Water purification plants(approximately 700 plants in Japan)
Sewage treatment plants(approximately 900 plants in Japan)
Comprehensive digital solutions for water andsewage treatment operators

Integrated flood
control measures

Flood forecasting and simulation technology related
to evacuations and emergencies

We are also engaged in verification tests and joint research withnational and local governments, companies, and other organizations in various countries to establish new technologies andsystems for the water business. These joint activities include
recent work with Higashine City, Yamagata Prefecture, on integrated flood control measures. The actual research involved
technologies for real-time flood forecasting and for simulating
evacuations and emergencies. We also demonstrated theeffectiveness of the technologies that were part of this research.
In addition, we began joint research with Water Agency Inc.,
whose business includes water and sewage treatment operations, to develop a practical AI/IoT-based sludge-reduction
service for sewage treatment plants.
Water Environment Solutions

Introduction

Management

Social Innovation

Environmental

Environmental

Achieving a Harmonized Society with Nature

Environmental

Efforts to Achieve a Harmonized Society with Nature

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceSocialApproach

Governance

Assurance

Hitachi Sustainability Report 2023

055

GRI 2-13/2-24/3-3/303-1/303-2/303-5

Our social lives and economic activities depend on numerous

opportunities related to natural capital and biodiversity in an

to climate change, we pursue initiatives aimed at to create abenefits (ecosystem services) bestowed by nature, and the loss

appropriate manner.

decarbonized society. Regarding urban air pollution, andAchieving a Decarbonized Societyof biodiversity is becoming recognized as a major economic

Achieving a Resource-Efficient Society

risk. Nature Risk Rising, published by the World Economic

reflect related global trends, Hitachi assesses and discloses

impact assessments concerning raw materials procurement.

Forum in 2020, notes that the creation of approximately $44

biodiversity-related risks, the dependence, and the impact of

To this end, we plan to accelerate the pace of efforts intended

trillion of economic value generation in economic value, or morebusiness activities overall on biodiversity.

to achieve a resource-efficient society. To reduce our environ-	Efforts to Achieve a Harmonized Society
with Naturethan half of global GDP, depends on natural capital and ecosystem services at risk due to biodiversity destruction.
Biodiversity Framework, adopted at the 15th Conference ofPreserving Ecosystems

the Parties to the United Nations Convention on Biological
Diversity (CBD-COP15) held in Montreal, Canada, in
December 2022, established 23 global targets with the aim

mental load further and minimize our impact on natural capital, we will step up a wide range of activities that include
increasing the energy efficiency of our products and services,

Against this backdrop, the Kunming-Montreal Global

Managing and Reducing Chemical Substances

Environmental Data

*1 OECM: Areas other than protected areas that contribute to biodiversity conservation. Acronym for Other Effective area-based Conservation Measuresresource consumption, certain findings have come to light inInitiatives to Minimize Impacts on
Natural Capital
Activities

Materiality

improving factory efficiency, using resources more effectively,
and managing chemical substances properly.
To expand positive impact, we engage in social contribution activities, such as forest conservation, and business activi-of implementing urgent measures to halt and reverse biodi-

To preserve the ecosystem and achieve a society harmonizedties that contribute directly to ecosystem preservation, such asversity loss in order to put nature on the path to recovery bywith nature to continue to enjoy nature’s benefits, we estab-building water treatment plants. We are also studying how to2030. Of particular important to business enterprises arelished targets to minimize our impact on natural capital as partTarget 3, which is to conserve at least 30% of terrestrial andof our long-term environmental targets. We classify the emis-

water areas through protected areas and OECM*1 (30 by 30

sion of greenhouse gases and chemical substances into thetarget), and Target 15, which is to ensure that businesses,

atmosphere and the generation of waste materials in theespecially large corporations and financial institutions,course of our business activities as negative impact activities.

assess and disclose risks related to biodiversity, dependen-

Providing products and services that contribute to ecosystemcies and impacts on biodiversity, and measures to provide

preservation and undertaking activities to preserve biodiversity

quantify the impact of these activities on the environment.
*1 IDEA v2: One of Japan’s leading inventory databases required to implement
LCAs for calculating negative impacts.

Timetable for Minimizing Impacts
100

information required to consumers to promote sustainable

and ecosystems are categorized as positive impact activities.

Reduce negative
impacts

consumption patterns.

We are working to quantify and minimize the difference

Activities to achieve
long-term targets

In addition, with heightened interest in ESG investment

between positive and negative impacts by 2050.

and financing, a private-sector initiative is growing to require

Hitachi identified the negative impacts that our businessdisclosure of biodiversity-related information. The Task Force

activities had on natural capital and evaluated these activities

on Nature-related Financial Disclosures (TNFD) established ausing version 2 of the Life-cycle Impact Assessment Method

disclosure framework for organizations to report and act on

based on Endpoint Modeling (LIME2) and an inventory data-

nature-related risks with a view to shifting the flow of funds tobase (IDEA v2*1), aiming to reduce such impacts. According

nature-positive activities. This framework requires companies

to our estimates, approximately half of our negative impacts inand financial institutions to assess and disclose risks andfiscal year 2022 were related to climate change. With regard

Impact (%)

Achieving a Harmonized Society
with Nature

To achieve a harmonized society with nature, as well as to

Ecosystem
preservation activities
Contributions throughproducts and services

Decarbonized society
Resource-efficient society
Harmonized society with nature

Minimize impacts
on natural capital

Increase positive
impacts
0
2010

2020

2030

2040

2050 (year)

Negative impacts
Positive impacts (ecosystem preservation activities)
Positive impacts (contributions through products and services)Introduction

Environmental

Management

Negative Impacts on Natural Capital (FY2022)

1%
Land use 16 %Other

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceSocial Innovation

Resource
consumption

46%

Climate change	Efforts to Achieve a Harmonized Society
with Nature

14%

Environmental Data

Assurance

Hitachi Sustainability Report 2023

056

Environmental Data Collection System (Eco-DS). this type ofnature-­positive goals of curbing biodiversity loss and encour-data is required to evaluate forest conservation efforts, and inaging restoration by the same year.
The 30 by 30 Alliance for Biodiversity was established topromote achievement of the 30 by 30 target agreed to at the

Scope of Negative Impact Calculations

G7 Summit 2021 and consists of governments, companies,
and NPOs. The goals of the alliance are to expand nationalparks, register satochi-satoyama landscapes and commer-

5%

18%

Ecotoxicity (air)Signing the Call to Action Statement, Initiated byBusiness for Nature

cial forests (areas of biodiversity preservation planned by

In 2020, the global Business for Nature coalition issued a Callconservation in such areas, and share information concern-to Action*2 statement. The aim was to encourage policy

ing these activities.

various organizations) in international databases, pursue

Hitachi, Ltd. supports this mission and will work tomakers around the world to adopt policies to “to reverse
nature loss in this decade.” Hitachi Ltd. agrees with this goal

Note: Calculated from LIME2 by using IDEAv2

advance related efforts.

and has signed the statement.

Managing and Reducing Chemical Substances
Preserving Ecosystems

Governancehttps://www.hitachi.com/environment/data/method.html

Achieving a Resource-Efficient Society

Achieving a Harmonized Society
with Nature

Socialfiscal 2022, we surveyed 0.31 km² of such forested areas.

Achieving a Decarbonized Society
Urban airpollution

Environmental*2 The Call to Action states that healthy societies, resilient economies, and thriving
businesses rely on nature. The statement urges governments to adopt policies
to reverse the loss of nature, and calls for the protection, restoration, andsustainable use of natural resources.

Negative Impacts on Natural Capital
(%)

100

100

92

85

Business for Nature’s Call to Action

80

https://www.businessfornature.org/call-to-action
60
40

21

20
0

30 by 30 Alliance (Japanese only)
https://policies.env.go.jp/nature/biodiversity/30by30alliance/

30 by 30 Alliance for Biodiversity Approved by
Ministry of the Environment (MOE), JapanThe 30 by 30 target aims to conserve or protect at least 30%of the land and sea areas in Japan by 2030 to achieve

2019

2020

2021

2022*1 (FY)

*1 The Deconsolidation of materials- and construction-related companies resulted
in a significant decrease.

Addressing Risks Related to Water and Biodiversity
Approach

GRI 303-1/303-2/303-5

Activities

Since Hitachi’s exposures to water risks in businesses vary by

the world that we classify as Category A in our environmental

servation activities (flood prevention, water impoundment,

region and the type of business, it is important to identify

management classification.

water purification, soil loss prevention, and carbon fixation) on

respective risks and implement countermeasures. To facilitate

an ongoing basis using evaluation methods commonly usedrisk response, we compiled the procedures for water risk identi-

in forestry-related public works projects. We also collect data

fication and countermeasures under Water Risk Guidelines*1,

on forested areas targeted for conservation using thewhich are followed by some 150 manufacturing sites around*1 Prepared with reference to Setting Site Water Targets Informed By Catchment
Context created by members of the UN Global Compact, the CEO Water
Mandate, the Pacific Institute, WRI, WWF, and other global institutions with theaim of helping companies set effective site water targets. In fiscal 2021, weissued a revised version of Water Risk Guidelines reflecting the revised content
of Water Risk Filter 6.0 and additional examples of measures.

We estimate the benefits gained through our forest con-

Introduction

Environmental
Environmental

Management

Environmental

Social Innovation

SocialGovernancerisks. Therefore, we conduct risk assessments specific to

Achievements in Fiscal 2022

assessment, in addition to region- and operation-specificbiodiversity by identifying and analyzing specific biodiversity-­

In fiscal 2022, we assessed the water and biodiversity
risks in each region and identified water risk as high at
a total of 20 business sites operating in China, India,

water risk identification checklists. We use these data andchecklists to identify and evaluate the water risks for eachwater risk identification checklist.

Environmental Governancefor the entire Group once a year.

Achieving a Harmonized Society
with Nature

Preserving Ecosystems
Environmental Data

Based on the results of these assessments, we pursue

Mexico, Vietnam, and Egypt from among manufactur-

more effective risk reduction activities related to water risk

ing sites classified as Category A in our environmental

and biodiversity.

management classification. Additionally, one businessbusiness unit and Group company by country and region, andIn recent years, the TNFD, an international informationsite operating in Czech was identified as having highdisclosure framework, has indicated that the perspective ofrisk related to biodiversity.
As a result of evaluating the operational water and

Identification of Water Risks Using the Environmental Data Collection System (Eco-DS)	Efforts to Achieve a Harmonized Society
with NatureManaging and Reducing Chemical Substances057

biodiversity is also important in identifying and assessing water

We use our Environmental Data Collection System

Advancing Our Environmental Vision andLong-Term Environmental Targets

Achieving a Resource-Efficient Society

Hitachi Sustainability Report 2023­(Eco-DS) and various globally recognized tools for water risk

related data using tools such as the Water Risk Filter*2 and theAchieving a Decarbonized Society

Assurance

Regional water risks

Operational water risks
Risks related to biodiversity

Number of evaluation
items related to water
resources, water quality,
water damage, regulations, reputational risk, etc.

business sites identified earlier, were found to have low
Risks related to biodiversity

to medium-high operational risks related to water andbiodiversity risks.

Approximately 50

5 (included in the left
column)Approximately 70

13 (included in the left
column)For this reason, Hitachi believes that none of ourbusiness sites face overall high water or biodiversity risks.
Water usage at the 20 business sites with highRisk identification method

Various water risk assessment
tools, including Aqueduct*3,
Water Risk Filter, Flood Hazard
Map of the World*4, are combined to identify risks basedon address information

Risk assessment

Assessed using a five-level
scale*5 from low to
extremely-highRisk results

biodiversity risks, all business sites, including the 21

High at 20 sites

regional water risks was 1.1 million m3, accounting for

Water Risk Filter

Risks identified using
information such as abusiness site’s volume ofwater intake and effluentsdischarged, and water-­related initiatives

Identifying risks related tobiodiversity based on
information on water
intake and wastewater
discharge at business
sites

Assessed using a five-level
scale*5 from low to
extremely-highAssessed using a fivelevel scale from low to
extremely-highAssessed using a fivelevel scale*5 from low to
extremely-highUnderstanding Water Risks in the Supply Chain

High at 1 site

Low to medium-high at allsites, including the 20 tothe left

Low to medium-high at allsites, including the 1 tothe leftof parts and products.

No business sites face an overall high water risk.
*2 A water risk assessment tool developed by the World Wide Fund for Nature (WWF) and the German Development Finance Institution (DEG)*3 A water risk assessment tool developed by the World Resources Institute (WRI).
*4 Flood risk maps published by the European Union.
*5 Five-level scale: low, low-medium, medium-high, high, extremely-highabout 8% of the14.1 million m3 of water used in Hitachi’s
main manufacturing processes.

Hitachi believes it is important to understand the water risks
faced by procurement partners to ensure stable procurement
In fiscal 2022, we used the Aqueduct and the Water Risk
Filter to identify regional water risks for about 600 of our environmental focus partners of fiscal 2021 (about 1,000 companies selected, accounting for 70% of transaction value). These
partners responded to our survey regarding environmental
initiatives, and we shared the results with relevant internal
departments. Moving forward, we will strive to understand thewater risks of our procurement partners further by expanding
the scope of the survey.
P.108 Responsible Procurement

Note: Hitachi normally refers to suppliers (including vendors and providers) as procurement partners, with whom we build business together on an equal footing.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

058

Managing and Reducing Chemical Substances
Managing Chemical Substances
ApproachManaging Chemical Substances in Our Products
SystemActivities

Environmental Governance

Hitachi believes that the control and reduction of chemical

Hitachi designates the chemical substances in our products

Achieving a Decarbonized Society

substances such as volatile organic compounds (VOCs), one

requiring management as Voluntarily Controlled Chemical

Classification Examples

Achieving a Resource-Efficient Societyof the causes of urban air pollution, are important not only for

Substances. We model the standards of the EU, where regu-

Prohibited Substances (Level 1)

reducing discharge of pollutants into the air and water, butlations are stringent, to identify and manage controlled chemi-

Substances for which use in products (including pack-also for managing chemical substance usage properly to

cal substances regardless of export destination, type of

aging) is generally prohibited inside and outside Japan,

minimize our impact on natural capital.

industry, or purpose of use.

but which might be found in products from suppliers.

Achieving a Harmonized Society
with Nature
Efforts to Achieve a Harmonized Society
with Nature	Managing and Reducing Chemical
Substances
Preserving Ecosystems
Environmental Data

Based on this belief, Hitachi formulated the Environment

We revise the list of managed substances and manage-and CSR-Based MONOZUKURI Standards to manage chemi-

ment levels when necessary, based on updates to the EU’s

cal substances at all stages of its operations—from design

REACH*1 and other regulations. Our aim is to add substancesand development, procurement, and from production to qual-

to our list of Voluntarily Controlled Chemical Substances six

ity assurance and shipping. We divide chemical substances inmonths before such substances are regulated officially. For

our products into two categories: prohibited substances andexample, we revised the list in accordance with the new regu-

controlled substances. These categories facilitate separate

lation of perfluorohexanesulfonic acid (PFHxS), their salts, andmanagement to respond to legal and regulatory frameworks

PFHxS-related substances as part of the POPs Convention*2,

at shipping destinations. With regard to chemical substances

which will be effective from November 2023.

used in our business operations, we reduce risk by assigning
three ranks to the use of such substances: prohibited,
reduced, and controlled. We also educate chemical substance handlers and managers on laws, regulations, andproper risk assessment.

*1 REACH: The European Union regulation of Registration, Evaluation,
Authorisation, and Restriction of Chemicals.
*2 POPs Convention: Stockholm Convention on Persistent Organic Pollutants.

Voluntarily controlled chemical substances in Hitachi Group products
https://www.hitachi.com/environment/data/chemical.html

Controlled Substances (Level 2)
Substances we are required to track and manage andsubstances requiring attention for recycling or appropriate disposal methods.

Introduction

Environmental

Social Innovation

Environmental

SocialGovernance

Hitachi cuts emissions of chemical substances from factories

In fiscal 2022, which was the first year of the Environmental

and other sites through stricter levels of management, includ-

Action Plan for 2024 (fiscal 2022–fiscal 2024), we achieved a

ing expanding the number and scope of chemical substances

reduction rate of 21% toward the target of reducing atmo-

Environmental Governancesubject to reduction*1.

spheric emissions of chemical substances per unit by 5%

Achieving a Resource-Efficient Society

Achieving a Harmonized Society
with Nature
Efforts to Achieve a Harmonized Society
with Nature	Managing and Reducing Chemical
Substances
Preserving Ecosystems
Environmental Data

059

GRI 305-7

Activities

Advancing Our Environmental Vision andLong-Term Environmental Targets

Achieving a Decarbonized Society

Hitachi Sustainability Report 2023

Assurance

Managing Chemical Substances in Our Business Operations
SystemEnvironmental

Management

We translate case studies for reduction into English andcompared with a base year of fiscal 2010. To reduce the emis-

Chinese, sharing these cases globally among Hitachi Groupsions, we are switching from paints containing VOCs tocompanies. We also follow legally prescribed procedures inwater-soluble and powder paints, expanding the use of saidmeasuring and managing emissions*2 of sulfur oxides (SOx)paints, while altering the painting and washing processes.

and nitrogen oxides (NOx), measurements for which are

Reducing Atmospheric Emissions of Chemical Substances(Hitachi Group)
China
Japan
North America

ASEAN, India, and other Asian regions
EuropeOther regions

(kt)

5.0

4.35

4.0

0.07
0.11

3.88

0.18

0.75

0.96

3.0

0.13

required under the laws and regulations of our business site
locations. At the same time, we continue efforts to restrict
emissions further.
We reference Japan’s Pollutant Release and Transfer
Register (PRTR) Law*3 in Group-wide monitoring in Japan ofEnvironmental Action Plan for 2024 Management Values

2.0

Reduction Rate in Atmospheric Emissions of Chemical
Substances per Unit (Hitachi Group)

1.0

From base year

21
reduction

public waters, removed outside our plants as waste, or discharged into sewage systems. We report the results to local
stances are exempt from reporting due to small quantities, ourkilograms or more per year.
*1 Chemical substances subject to reduction: A total of 50 substances selected interms of hazard and atmospheric emissions. Approximately 100% of substances in fiscal 2022 results were classified as VOCs.
*2 Emissions of SOx and NOx: Calculated using data by business site (measured
values, exhaust volume, content rate, etc.).
*3 PRTR Law: Act on the Assessment of Releases of Specified Chemical
Substances in the Environment and the Promotion of Management Improvement

0.09
0.04
0.44 0.16
0.08

2.50
0.07
0.03
0.15
0.34
0.06

2.70
1.56

2018

1.85

Target: 5%

100%
Emissions= Activity amount*

FY201079%
Emissions

1

2019

2020

2021

1.09

0.06
0.05
0.23 0.01
0.02
0.72

2022*1

Note: A tmospheric emissions of VOCs and other chemical substances arecalculated from the content rate included in the materials, etc.
*1 Decreased significantly due to the deconsolidation of the materials and construction machinery companies.

%

governments for each office or plant. Although certain sub-emission, and transfer of all PRTR substances totaling 10

3.03

2.37

0

chemical substances released into the atmosphere or into

policy is to aggregate and manage data on the handling,

0.05
0.06
0.19

= Activity amountFY2022(base year)*1 Activity amount is a value closely related to atmospheric emissions of chemical
substances at each business site (for example, substances handled, sales,
and output)

P.063 Environmental Load from Operations
Case Studies of Reducing Chemical Substances in Our
Business Activities
https://www.hitachi.com/environment/casestudy/index.html#case05(FY)

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceManagement

Social Innovation

Efforts to Conserve Ecosystems
Approach

Activities

At Hitachi, we seek to reduce negative impacts on natural
impacts, including social contribution activities to protect

	Preserving Ecosystems
Environmental Data

Category

GRI 304-3

Achieving a Resource-Efficient SocietyManaging and Reducing Chemical Substances

Governance

Assurance

Hitachi Sustainability Report 2023

060

Ecosystem Preservation Activities Menu

capital caused by business activities and to promote positive

Efforts to Achieve a Harmonized Society
with Nature

SocialPreserving Ecosystems

Achieving a Decarbonized Society

Achieving a Harmonized Society
with Nature

Environmental

nature and products and services that help preserve the eco-Business sites

system. In this way, we intend to minimize our impact onnatural capital by fiscal 2050.
Hitachi created an Ecosystem Preservation Activities
Menu citing specific activities preserve the ecosystem. This
chart including activities that are difficult to quantify but arenonetheless important, such as the protection of rare species
and efforts to make biodiversity a benchmark when making
investment decisions. Each business site sets goals andpursues initiatives based on the Ecosystem Preservation
Activities Menu to create a harmonized society with nature.

Value chain

Community

Water use that takes
watershed ecosystems
into consideration

Activities

No. of menu items

Production

Reduce the use of resources that cannot be reused

4

Transportation

Use packaging that takes ecosystem into consideration

7

Collection, disposal, andrecycling

Reduce hazardous materials in products

2

Product planning,­development, and design

Estimate the impact of R&D on biodiversity during the product life cycle andimplement mitigation measures, if needed

3Site management

Use native species and establish biotopes

17

Water use

Use rain water1

Investment andacquisition

Confirm the impact on biodiversity when investing in or acquiring a business,and implement measures to minimize such impacts

1Market entry andexpansion

Include biodiversity as an investment benchmark

1Business development

Develop products and services to purify water, air, and soil and expand suchbusinesses

1

Procurement

Procure paper and other office supplies with a bias for products that takebiodiversity into consideration

17

Transportation

Implement ballast water measures during marine transportation

2

Sales

Expand the sales of products that take biodiversity into consideration

9

Collection, disposal, andrecycling

Reuse and recycle components

7

Entire value chain

Pursue the use of renewable energy

1

Engagement

Promote employee activities outside the company

3

Social contribution

Conduct desert greening and afforestation activities

12

IntakeObserve and collect biota information (impact on ecosystem depending on
intake volume)

14

Discharge

Establish biota management indicators and make observations (species andnumbers of inhabiting organisms)

14

Case Studies of Promoting Ecosystem Preservation
https://www.hitachi.com/environment/casestudy/index.html#case06

Introduction

Management

Social Innovation

Environmental

Environmental

Environmental Data

Environmental

GHG Emissions Throughout the Value Chain

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceCalculating GHG Emissions Throughout the Value Chain (Fiscal 2022)
Hitachi calculates greenhouse gas (GHG) emissions throughout the value chain in conformance

Achieving a Resource-Efficient Society

with GHG Protocol standards. This gives us a good grasp of emission hotspots in our value

Environmental Data

chain with which we can establish effective targets and reduction measures. Energy-related CO2

Procurement of
Raw Materials and Parts

and services we sell. We thus believe that we can make a major contribution to decarbonization

Environmental Load from Operations

through our businesses by giving priority to enhancing the efficiency and energy-saving features

An extremely high share of our value chain emissions comes from the use of the productsof our products and services.

Scope 3
Downstream

services

2 Capital goods
Construction companies, etc.

0.2

and distribution

Shipping companies

Scope 2

Direct emissions from in-house fuel use
and industrial processes

Indirect emissions from production ofelectricity and heat purchased by thecompany240.22Mt-CO e [89.2%]
2

Mt-CO2e

%

0.0%

0.0%

10 Processing of sold products

Scope 211 Use of sold products

Energy-related
indirect emissions
Indirect emissions fromproduction of electricity andheat purchased by thecompany

0.4

0.0%

%

Product end users

89.1%

12 End-of-life treatment of soldproducts

Waste treatment companies

0.1%

13 Downstream leased assets
Users of leased assets

0.0%

14 Franchises

Scope 1Other indirect emissions not covered by
Scope 1 and 2 (Emissions by other entities
related to the company’s activities)

and distribution

Shipping companies

Processors of intermediate products

4 Upstream transportation

269.24061

9 Downstream transportation

0.5%

3 Fuel- and energy-­related

Extraction companies, etc.

Direct emissions fromin-house fuel use andindustrial processes

9.6%

activities not included in
Scope 1 and 2

Environmental Accounting

Scope 3: Downstream

Transport, Use,
Waste Disposal/Recycling

Scope 1

Suppliers, etc.

Total greenhousegas emissions

Production

Direct emissions

gases, making it all the more important to focus on CO2 reduction efforts.

2

Hitachi Sustainability Report 2023

Upstream
1 Purchased goods and

0.49Mt-CO e [0.2%]

Assurance

Scope 3

accounts for almost all of Hitachi’s GHG emissions, with there being negligible releases of other	GHG Emissions Throughout the
Value Chain
Environmental Management Data

Governance

GRI 302-2/305-1/305-2/305-3/305-4/305-5

Achieving a Decarbonized Society

Achieving a Harmonized Society with Nature

Social

1.08Mt-CO e [0.4%]
2

5 Waste generated inoperations

0.0
 0.0

Waste treatment companies
6 Business travel

Transportation companies, etc.
7 Employee

Scope 3: Upstream
Other indirect emissions not covered by
Scope 1 and 2 (Emissions by other entities
related to the company’s activities)

27.45Mt-CO e [10.2%]

commutingTransportation operations, etc.

0.1

Franchise members%

15 Investments
Investment destinations

0.0%

%

%

8 Upstream leased assets
Leasing companies
Included in Scope 1 and 22In-house: Within the scope of the company’s organizational boundaries. In principle, all business activities of the company itself
and activities within or controlled by its consolidated subsidiaries.
Upstream: In principle, activities related to products and services that are purchased.
Downstream: In principle, activities related to products and services that are sold.

Introduction

Environmental

Management

Social Innovation

Environmental

Advancing Our Environmental Vision andLong-Term Environmental Targets

Environmental Load from Operations
Environmental Management Data
Environmental Accounting

Description

ReportingBoundary

Percentage(%)

Emissions (Mt-CO2e)

100.0

Total Scope 1 and 2

Hitachi Group

1.56*

1

0.6

Direct emissions from in-house fuel use and industrial processes

Hitachi Group

0.49

0.2

Indirect emissions from production of electricity and heat purchased by the company

Hitachi Group

1.08

0.4

Hitachi Group

267.67

99.4

Scope 1*2

Achieving a Decarbonized Society	GHG Emissions Throughout the
Value Chain

062

269.24

Scope 2*3

Environmental Data

Hitachi Sustainability Report 2023

Hitachi Group

Direct emissions

Achieving a Harmonized Society with Nature

Assurance

Total Scope 1, 2, and 3

Environmental GovernanceAchieving a Resource-Efficient Society

Governance

Detailed Data on GHG Emissions Throughout the Hitachi Value Chain (Hitachi Group, Fiscal 2022)
Category

Environmental

SocialEnergy-related indirect emissions
Scope 3 Total*4

Scope 3 Upstream (other indirect emissions) upstream
1 Purchased goods and services

Emissions from the resource extraction stage to the manufacturing stage, including raw materials, parts, supplied products,
and sales

25.86

9.6

2 Capital goods

Emissions generated in the construction, manufacture, and shipping of the company’s own capital goods, such as equipment,
devices, buildings, facilities, and vehicles

1.22

0.5

 uel- and energy-related activities
3 F
not included in Scope 1 or Scope 2

Emissions from procuring the fuel necessary for electricity and other energy production, including resource extraction, production, and shipping

0.10

0.0

 pstream transportation and
4 U
distribution

Emissions from the distribution of raw materials, parts, products supplied, and sales prior to the delivery of materials to thecompany, as well as other distribution activities of products for which the company bears the expense

0.03

0.0

5 W
 aste generated in operations

Emissions from the transportation, disposal, and treatment of waste generated from the company’s operations

0.06

0.0

6 Business travel

Emissions generated from the fuel and electricity used by employees for business travel

0.05

0.0

7 Employee commuting

Emissions generated from the fuel and electricity used by employees commuting

0.13

0.0

8 Upstream leased assets

Emissions from the operation of assets leased by the company, excluding those counted in Scope 1 and 2

Included in Scope 1 and 2—

0.0

Hitachi Group

Scope 3: Downstream (other indirect emissions) ownstream transportation and
9 D
distribution

Emissions from the transportation, storage, loading and unloading, and retail sales of products

0.12

10 Processing of sold products
11 Use of sold products*6
12 End-of-life treatment of soldproducts sold*6

Emissions from the transportation, waste disposal, and treatment of products by end users, such as consumers and businesses

13 Downstream leased assets
14 Franchises
15 Investments

Emissions by downstream companies during the processing of intermediate products

5

N/A*

—

Emissions from the use of products by end users, such as consumers and businesses

239.85

89.1

0.18

0.1

Emissions from the operating of assets owned by the reporting company as the lessor, which are leased to other entities

0.02

0.0

Emissions by franchises under Scope 1 and 2

N/A—

Emissions related to the management of investments

0.05

0.0

Hitachi Group*1 FY2022 CO2 emissions of energy-related companies and automotive business companies included in the scope of consolidation since FY2020 are included in the figures above. Significant decrease due to deconsolidation of materials-related and construction
machinery-related companies.
*2 Including SF6, PFC, HFC, N2O, NF3, and CH4. The gas and fuel oil conversion factors are based on the List of calculation methods and emission factors used in the Greenhouse Gas Emissions Calculation, Reporting and Publication System.
*3 CO2 emissions from electricity consumption is calculated using a market-based calculation method. CO2 electrical power conversion factors: We used adjusted conversion factors for individual power businesses based on the Act on Promotion of Global WarmingCountermeasures in Japan. In China, we used the average emissions factor published by the government for the national power grid. For other countries, we used the latest values for each fiscal year supplied by the International Energy Agency (IEA) for individual
countries and by power supply companies.
*4 FY2022 CO2 emissions of energy-related companies included in the scope of consolidation since FY2020 are included in the figures above. The FY2022 volume for automotive business companies are not included in the figures above, as these are intermediate products.
*5 Cannot be determined due to insufficient information about the processing.
*6 CO2 emissions per unit is based on the Inventory Database for Environmental Analysis (IDEA), developed by the National Institute of Advanced Industrial Science and Technology (AIST) and the Japan Environmental Management Association for Industry (JEMAI).

Introduction

Management

Social Innovation

Environmental

Environmental

Environmental Load from Operations

Environmental

Detailed Data on Resource Input and Environmental Load Output

Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceSocialGovernance063

Hitachi Sustainability Report 2023

Assurance

GRI 301-1/301-2/302-1/302-4/303-1/303-2/303-3/303-4/303-5/305-4/305-5/305-7/306-1/306-2/306-3/306-4/306-5

Energy Inputs and GHG Emissions During Business Operations
The following is an outline of the energy consumed during Hitachi’s business operations and the part of our environmental load consisting of greenhouse gas (GHG) emissions.

Achieving a Decarbonized Society
Achieving a Resource-Efficient Society

Energy Inputs

Achieving a Harmonized Society with Nature

Environmental Data
GHG Emissions Throughout the Value Chain

	Environmental Load from Operations

Energy Inputs
RenewableenergyElectricity

Environmental Management Data
Environmental Accounting

Non-renewableenergyReportingBoundary

Unit

Hitachi GroupGWh

FY2018FY201914,605

FY2020

FY2021

FY2022*1

12,427

9,674

9,957

5,387
706

Hitachi Group

GWh

7

18

138

193

(Self-generated amount)Hitachi Group

GWh

7

18

22

34

25

(Purchases: Includes non-fossil certificates)

Hitachi Group

GWh

—

—

116

159

681

Total

Electricity

Electricity

Hitachi Group

GWh

6,020

5,992

4,498

4,584

2,218

Fuel and heat*2

City gas

Hitachi GroupGWh (billion m3)

2,236 (0.18)

1,933 (0.15)

1,339 (0.11)

1,373 (0.11)

767 (0.06)

LPG, LNG

Hitachi GroupGWh (kt)

3,741 (251)2,015 (150)

1,646 (111)

1,705 (118)

1,217 (82)

Other natural gas

Hitachi GroupGWh (billion m3)

58 (0.005)

258 (0.02)

276 (0.02)

319 (0.03)

261 (0.02)

Fuel oil (heavy oil, kerosene, etc.)

Hitachi GroupGWh (ML)930 (87)792 (75)653 (61)495 (47)

197 (19

Solid fuel (coke)

Hitachi GroupGWh (kt)

1,528 (188)1,333 (162)

1,111 (137)

1,278 (156)

Steam, hot water and cold water

Hitachi GroupGWh (PJ)

85 (0.31)

86 (0.31)

13 (0.05)

10 (0.04)*1 Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.
*2 Used 3.6MJ/kWh in the conversion from calorific value.

)—

21 (0.08)

Introduction

Environmental

Total greenhouse gases*2

Advancing Our Environmental Vision andLong-Term Environmental Targets

Energy-related CO2 emissions

Environmental GovernanceAchieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Environmental Data
GHG Emissions Throughout the Value Chain

	Environmental Load from Operations
Environmental Management Data
Environmental Accounting

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

064

Greenhouse Gases Emitted

Environmental

Achieving a Decarbonized SocietyManagement

GHG emissions other thanenergy-related CO2

Reporting BoundaryUnit

FY2018FY2019FY2020

FY2021

FY2022*1*3

Hitachi Group

kt-CO2e

5,026

4,415

3,313

3,412

1,565

Total

Hitachi Group

kt-CO2

4,973

4,374

3,296

3,384

1,538

(Direct emissions)

Hitachi Group

kt-CO2

1,869

1,489

1,202

1,245

459

(Indirect emissions)

Hitachi Group

kt-CO2

3,104

2,885

2,094

2,139

1,079

Total

Hitachi Group

kt-CO2e

53

41

17

28

26.7

Sulfur hexafluoride (SF6)

Hitachi Group

kt-CO2e

35

24

11

20

22.0

Perfluorocarbons (PFC)

Hitachi Group

kt-CO2e

5

4

0

2

1.3

Hydrofluorocarbons (HFC)

Hitachi Group

kt-CO2e

3

3

1

3

2.4

Dinitrogen monoxide, nitrogen trifluoride,methane (N2O, NF3, CH4)

Hitachi Group

kt-CO2e

3

2

2

3

0.9

CO2 from non-energy sources

Hitachi Group

kt-CO2e

7

8

3

0

0.2

Note: CO2 emissions from electricity consumption is calculated using a market-based calculation method. CO2 emission coefficients for Japan (including power plants) are the latest adjusted emission coefficients for each electric utility based on the Act on Promotionof Global Warming Countermeasures. For China, we use the average emissions factor for the national power grid published by the government. For countries other than Japan and China, we use the latest IEA emission factors by country for each fiscal year
and the latest factors provided by power supply companies.
Note: The gas and fuel oil conversion factors are based on the List of calculation methods and emission factors used in the Greenhouse Gas Emissions Calculation, Reporting and Publication System.
*1 Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.
*2 Total GHGs: Scope 1 and 2 total*3 FY2022 CO2 emissions of an energy-related company and auto parts-related companies included in the scope of consolidation since FY2020 are included in the figures.

Introduction

Environmental

Management

Social Innovation

Environmental

SocialGovernance065

Hitachi Sustainability Report 2023

Assurance

Raw Material Inputs and Waste and Valuables Generation During Business Operations
The following is an outline of the raw materials used during Hitachi’s business operations and the part of our environmental load consisting of the generation of waste and valuables.

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceAchieving a Decarbonized Society

Raw Material Inputs
Reporting Boundary

Unit

Hitachi Group

kt

4,403

3,776

3,066

3,235

788

Total metals

Hitachi Group

kt

4,031

3,454

2,861

3,083

685

New materials

Hitachi Group

kt

1,624

1,372

1,075

909

614

Recycled materials, etc.

Hitachi Group

kt

2,407

2,082

1,786

2,175

71

Total plastics

Hitachi Group

kt

165

147

115

74

43

New materials

Hitachi Group

kt

163

143

113

72

40

Recycled materials, etc.

Hitachi Group

kt

2

4

2

2

3

Total other materials

Hitachi Group

kt

207

175

90

77

61

New materials

Hitachi Group

kt

201

173

89

76

54

Recycled materials, etc.

Hitachi Group

kt

6

2

1

1

7

Reporting Boundary

Unit

Total waste and valuables generated

Hitachi Group

kt

1,384

1,302

1,061

1,111

356

Waste reduction

Hitachi Groupkt

94 (5.6)

101 (17.5)

75 (9.8)

74 (10.5)47 (23.1)

Reuse

Hitachi Groupkt

1 (0.0)5 (2.2)35 (11.4)

36 (18.7)

18 (6.2)

Materials recycled

Hitachi Groupkt

1,044 (25.6)

919 (25.3)

740 (17.6)

784 (19.3)

256 (16.7)

Thermal recovery

Hitachi Groupkt

13 (1.4)

21 (4.9)

11 (5.4)

13 (6.5)

16 (4.6)

Landfill

Hitachi Groupkt

232 (3.7)

256 (6.1)

200 (4.9)

204 (5.7)

20 (6.5)

Nonhazardous (hazardous)

Hitachi Groupkt

1,348 (36)1,246 (56)1,012 (49)1,050 (61)299 (57)

Total amount of raw materials
Raw materials

MetalsAchieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Environmental Data

Plastics

GHG Emissions Throughout the Value Chain

	Environmental Load from Operations
Environmental Management Data

Other materials

Environmental Accounting

FY2018FY2019FY2020

FY2021

FY2022*1

Waste and Valuables Generated

RecycleFY2018FY2019Note: Figures in parentheses are the generation of waste defined as hazardous under the Basel Convention.
*1 Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.
*2 Fiscal 2022 generation of waste and valuables of an energy-related company and auto parts-related companies that became consolidated subsidiaries in fiscal 2020 are included in the figures above.

FY2020

FY2021

FY2022*1*2

Introduction

Environmental

Management

Social Innovation

Environmental

Water Inputs and Effluent Discharges During Business Operations

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

066

GRI 2-27

The following is an outline of the total amount of water resources used during Hitachi’s business operations and the part of our environmental load consisting of effluent discharges.

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Water Input

Environmental GovernanceTotal water usage*1

Achieving a Decarbonized Society

Surface water

Achieving a Resource-Efficient Society

Reporting BoundaryUnit

FY2018FY2019FY2020

FY2021

FY2022*2*3

Hitachi Group

Million m3

37.02

36.41

26.35

26.03

14.23

Tap water (water for drinking and other household uses)

Hitachi Group

3

Million m

7.61

7.95

5.10

5.23

5.53

Industrial water, river water

Hitachi Group

3

Million m

16.63

15.58

12.62

12.47

5.17

3

Achieving a Harmonized Society with Nature

Groundwater

Hitachi Group

Million m

12.74

12.84

8.60

8.32

3.52

Environmental Data

Rain water

Hitachi Group

3

Million m

0.01

0.02

0.01

0.01

0.01

Recycled water (recycled from the wastewater of other organizations)

Hitachi Group

Million m

0.03

0.02

0.01

0.01

0.00

Reporting Boundary

Unit

Total water effluents discharged

Hitachi Group

Million m3

34.10

33.41

23.25

26.03

14.23

3

GHG Emissions Throughout the Value Chain

3	Environmental Load from Operations
Environmental Management Data
Environmental Accounting

Water Effluents Discharged
FY2018FY2019FY2020

FY2021

FY2022*2*3

Public water

Hitachi Group

Million m

22.44

22.46

15.29

15.40

8.26

Sewerage

Hitachi Group

Million m3

8.18

7.74

5.44

5.31

3.76

Underground infiltration, evaporation, etc.

Hitachi Group

Million m3

3.48

3.21

2.52

5.32

2.21

Water quality

BOD (biochemical oxygen demand)

Hitachi Group

t

392

232

204

156

77

COD (chemical oxygen demand)

Hitachi Group

t

1,657

400

406

301

137

*1 Figures through FY2021 represent water usage in manufacturing processes and general daily usage at manufacturing sites, as well as general daily usage in locations other than manufacturing sites. Figures for FY2022 represent water usage in manufacturing
processes and daily general usage at manufacturing sites.
*2 FY2022 water usage of an energy-related company included in the scope of consolidation since FY2020 is included in the reported figures above. FY2022 water usage of auto parts companies included in the scope of consolidation since FY2020 is not includedin the reported figures above, but amounted to 412 million m3.
*3 Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.

Introduction

Environmental

Management

Social Innovation

Environmental

Inputs and Discharges of Chemical Substances During Business Operations

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

067

GRI 2-27

The following is an outline of the chemical substances handled during Hitachi’s business operations and the part of our environmental load consisting of chemical substance discharges.

Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceChemical Substances Handled

Total chemical substances handled*1

Chemical substances handled

Reporting Boundary

Unit

Hitachi Groupkt

Reporting BoundaryUnit

FY2018FY201988.29

FY202083.68

FY202147.49*2

FY2022*3

26.20

1.70

Achieving a Decarbonized Society
Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Environmental Data
GHG Emissions Throughout the Value Chain

	Environmental Load from Operations
Environmental Management Data
Environmental Accounting

Chemical Substances Discharged
FY2019FY2020

FY2021

FY2022*3

Hitachi Group

kt

5.55

4.98

3.27

3.50

1.39

Chemical substances discharged

Hitachi Group

kt

4.35

3.88

2.37

2.50

1.09*4SOx (sulfur oxides)

Hitachi Group

kt

0.3

0.3

0.2

0.2

0.01

NOx (nitrogen oxides)

Hitachi Group

kt

0.9

0.8

0.7

0.8

0.29

Total chemical substances discharged
Chemical substances discharged

FY2018*1 We selected 50 substances from the perspective of hazards and atmospheric emissions.
*2 Significant decrease due to deconsolidation of a materials-related company.
*3 Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.
*4 Approximately 100% of emissions classified as VOCs in FY2022.

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets

Total

Achieving a Resource-Efficient Society

GHG Emissions Throughout the Value Chain
Environmental Load from Operations

	Environmental Management Data
Environmental Accounting

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

068

Number of ISO 14001 Certified Companies (Hitachi Group, as of March 2023)

Achieving a Decarbonized Society

Environmental Data

Social Innovation

Environmental Management Data

Environmental GovernanceAchieving a Harmonized Society with NatureManagement

Reporting Boundary

Unit

Hitachi Group

Companies

FY2020

FY2021

FY2022*1

202

185

281

Japan

85

66

66

China

43

43

61

42

43

50

North America

10

9

13

Europe17

15

52

Other regions

5

9

39

ASEAN, India, and other Asian regions

Hitachi Group

Companies

Note: Companies with at least one certified business site.
*1 Significant changes in the figure, resulting from both the increase caused by the consolidation of an energy-related company and the decrease caused by the deconsolidation of materials-related and construction machinery-related companies.

Number of Regulatory Violations and Complaints
Reporting Boundary
Regulatory violations

Unit

Water quality
Air quality
Waste materials

Hitachi Group

Cases

Other (equipment registration, etc.)
Complaints

Hitachi Group

Cases

FY2018FY2019FY2020

FY2021

FY2022

4

4

5

2

0

2

0

0

0

2

3

0

4

3

0

4

1

1

3

0

3

5

3

3

0

Introduction

Environmental
Environmental
Advancing Our Environmental Vision andLong-Term Environmental Targets
Environmental GovernanceManagement

Environmental Accounting

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

069

GRI 201-1

Environmental Protection Costs

Total
Expenses

Achieving a Resource-Efficient Society
Achieving a Harmonized Society with Nature

Environmental Load from Operations
Environmental Management Data

Unit

Hitachi Group

Billions of yen

FY2018FY2019FY2020

FY2021

FY2022*2

94.16

105.71

86.62

79.97

57.21

Business area

23.57

22.62

19.14

19.56

6.30

Upstream/Downstream

Green procurement expenses, recovery and recycling of products andpackaging, recycling expenses

0.68

0.68

0.62

0.64

0.08

Administration

Labor costs for environmental management and the implementation andmaintenance of environmental management systems

6.72

4.98

5.88

5.40

3.06

Research and development

Costs of research and development and product designs to reduce theenvironmental burden caused by products and production processes

61.86

77.01

60.64

53.79

47.55

Social activities

Planting, beautification, and other environmental improvement costs

0.93

0.25

0.22

0.26

0.11

Environmental remediation

Environmental mitigation costs, contributions, and charges

0.40

0.17

0.12

0.32

0.11

Environmental Data
GHG Emissions Throughout the Value Chain

Reporting Boundary

Maintenance costs for equipment with low environmental loads,
depreciation, etc.*1

Achieving a Decarbonized Society	Environmental Accounting

Social Innovation

Hitachi Group

Billions of yen*1 Equipment depreciation costs are calculated using the straight-line method over five years.
*2 An energy-related company included in the scope of consolidation since FY2020 is not included in the reported cost figures for FY2022. Significant decrease due to deconsolidation of materials-related and construction machinery-­related companies.

Environmental Protection Effects
Economic Effects*3
Major FY2021 Activities
Total
Net income effects

Recovering value from waste by sorting and recycling

Cost reduction effects

Installing high-efficiency equipment (lighting, power supply, etc.)

Reporting Boundary

Unit

Hitachi Group

Billions of yen

Hitachi Group

Billions of yen

FY2018FY2019FY2020

FY2021

FY2022*4

16.05

18.62

14.28

19.20

11.95

8.35

12.42

9.66

15.15

7.89

7.70

6.20

4.62

4.05

4.06

*3 Economic effects include the following:
Net income effects: Real income from the sale of valuable materials and environmental technology patents.
Cost reduction effects: Reductions in electricity, waste treatment, and other expenses through activities that reduce environmental loads.
*4 An energy-related company included in the scope of consolidation since FY2020 is not included in the reported cost figures for FY2022. Significant decrease due to deconsolidation of materials-related and construction machinery-related companies.

Environmental Liability
As the amounts that we can reasonably project as future environmental liabilities as of end of March 2023, we recorded 4.2 billion yen in costs for the disposal of waste containing PCBs and 1.1 billion
yen to clean up contaminated soil.

Introduction

Management

Contents
071

Human Capital

094

Diversity, Equity and Inclusion

102

Human Rights

108

Responsible Procurement

114

Quality and Customer Satisfaction

120

Social Contribution Activities

124

Social Data

SocialSocial Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

070

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

071

Human Capital

Human Capital	Executive Summary
Global Human Capital Management
Work-Life Management
Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion

Basic Concept
Hitachi believes that employees are the source of value and we aim to leverage the combined power of our global network of employees to provide value to our customers and society andcontribute to achieving a sustainable society. In working toward these goals, we are committed to respecting the fundamental rights of employees, providing equal opportunities, and ensuring
occupational safety and health. We will strive to build favorable relationships between employees and the company, including creating work environments conducive to feelings of pride andhappiness concerning working at Hitachi, and actively engaging in dialogue regarding the treatment of employees and career advancement opportunities.

Topic

Overview

Human Rights
Responsible Procurement

We believe in the need for a diverse talent and an organization that adapts quickly to a world of

Quality and Customer Satisfaction

constant change, working as one team in which people from different countries, regions, and busi-

Social Contribution Activities
Social Data

Global Human
CapitalManagement

Acquiring and Developing Digital Talent
FY2024 Target: 97,000 persons*1

ness units work in a proactive manner. To realize this goal, we strive to develop human capital and

FY2022 Results: 83,000 persons

improve our internal environments. Specifically, we formulated the 2024 Human Resources Strategy,

Employee Engagement (positive response rate)

implementing measures group-wide and globally based on the three key pillars of People, Mindset,
and Organization, along with the underlying Foundation of the HR strategy.

Work-LifeManagement

Targets, KPIs, and Results

FY2024 Target: 71.0%*2
FY2022 Results: 69.5%

We go beyond “work-life balance,” in which employees are simply balancing work and private life, to promote “work-life management” which encourages employees
to proactively take charge of improving the quality of both their work and private lives. We are implementing work-style reforms and systems facilitating balance
between work life and private life.
Guided by a basic philosophy that safety and health take precedence overall we coordinate withrelated entities, including contractors and procurement partners, to ensure the Group works

Occupational
Health and
Safetytogether to create safe, secure, comfortable, and healthy workplaces for all. Specifically, based on

Zero Fatal Accidents

the Hitachi Group Health and Safety Policy, Hitachi has developed and introduced occupational

Annual Target: 0

health and safety management systems best suited to its business, and conducts regular risk

FY2022 Results: 5

assessments and audits, while also working to roll out occupational health and safety training programs and other initiatives worldwide.
Freedom of
Association
and Collective
Bargaining

Based on the Hitachi Group Code of Ethics and Business Conduct, common throughout the Group, Hitachi respects freedom of association, the right to organize,
and the right to collective bargaining as human rights that are particularly relevant to the workplace. Onboarding training and the Hitachi Group Corporate Ethics
Month (annual) represent some of the ways we strive to help employees understand these rights.

*1 Hitachi Astemo is excluded*2 Target has been raised since we achieved the initial target/KPI
Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Introduction

SocialHuman Capital
Executive Summary	Global Human Capital Management
Work-Life Management
Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities

Management

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

072

Global Human Capital Management
Approach to Human Capital

Global Human Capital Strategy
GRI 2-23

Approach

Hitachi believes that human capital, in other words, people are
the source of our value. Therefore, we leverage the combined
power of our global network of employees to provide value toour customers and society, contributing to the creation ofsustainable societies.
We believe in the need for a diverse talent and an organization that adapts quickly to a world of constant change,
working as one team in which people from different countries,
regions, and business units work in a proactive manner. To
realize this, we strive to promote talent development andimprove our internal environments.

Social Data

strategy, Hitachi aims to promote talent development that

Strategy

contributes solutions to social issues. In addition to on-site

Hitachi conducts a human capital strategy linked to our management strategy. We formulated our 2024 HR Strategy
based on the Hitachi Mid-term Management Plan 2024,
which defines our vision of becoming an employer of choice inthe global marketplace, and a vibrant organization whereindividuals aspiring to make social contributions gather andparticipate enthusiastically. To this end, we pursue a variety ofmeasures around the three key pillars of People, Mindset, andHitachi established the Growth Strategy Meeting, Risk
Management Meeting, and Human Capital Strategy Meeting
under the Senior Executive Committee. These meetings deliberate important management matters. The Human Capital
Strategy Meeting convenes at least twice a year to discuss anddecide Hitachi Group human capital strategies, policies, andsubmit proposals to the board of directors when necessary.
These discussions include measures to foster an organizationand culture for growth, and to secure and develop talents.

diverse employees respect each other’s differences and areable to innovate.
P.094 Diversity, Equity and Inclusion–MMP2021

Toward Global Leader in SIB

Moving Toward New Growth—Sustainable Growth with assets by acquisition—· Implement Global HR Platform
Human Capital Database, GLD (Leadership Program), HGG (Grading), GPM(Performance Review), Workday (HR integrated platform), Employee Survey etc.

Beyond· Execute HR measures (D&I, Talents)
Female and Non-Japanese executive and corporate officers Female Managers,
acquisition of leaders/digital Talents etc.

2024

· Mindset, Corporate culture approach(Fostering Culture, support to PMI, Promoting Job-based HR Management etc.)

Global HR
management 3.0

Global HR
management 2.0

Contribute to Business through Diverse Talents,
Equitable Opportunity and Inclusive Organization

Mindset,Corporate culture approach

Execute HR measures(D&I, Talents)

Senior Executive Committee
Human Capital
Strategy Meeting

Diversity, equity and inclusion is an important factor in executing HR Strategy. We aim to build an organization in which<Major Achievements/Actions>Board of Directors

Growth Strategy
Meetinggroup to improve individual capabilities, skills, and specialties.

MMP2024–

Transform to SIB
Building a foundation for growth
GRI 2-13/2-24

Structure

work instruction, we conduct programs globally across the

Global HR Initiatives–MMP2015

Global Human Capital Management

Organization, built on an underlying Foundation. Based on thisRisk Management
Meeting

Establish organization and culture for growth, discuss anddecide human capital strategies and policies

Global HR
management 1.0 Implement Global HR Platform

2011

Start of Global HR Initiatives*1 GLD: Global Leadership Development program*2 HGG: Hitachi Global Grade*3 GPM: Global Performance Management

Introduction

SocialManagement· We lead transformation into “Employer of choice” in global market - Become a vibrant “Talent Destination” that contributes to society· Become “The World’s #1 HR pioneers” who cope with changes and contribute to business
Pillars

Optimize talent (workforce and capability)and engagement for growthSocial Data

HR Strategy

People (Talent)

Social Contribution Activities

073

Key Initiatives

Occupational Health and Safety

Quality and Customer Satisfaction

Hitachi Sustainability Report 2023

Assurance

VisionWork-Life Management

Responsible Procurement

GovernanceContribute to Business through Diverse Talents, Equitable Opportunity and Inclusive Organization	Global Human Capital Management

Human Rights

SocialMissionExecutive Summary

Diversity, Equity and Inclusion

Environmental

Overall Human Resources Strategy Linked to Management Strategy

Human Capital

Freedom of Association andCollective Bargaining

Social Innovation

Mindset (Culture)
Foster a mindset and culture for growth

Organization
Promote collaboration between divisions
and improve productivity and efficiency
on a global basis for growth

1. Attract, retain, develop and match talents, especially Global Leaders and Digital Talents and maximize their potential
2. Mobilize (Match) right talent for right roles at right time across Hitachi group
3. Focus on employee wellbeing, engagement & experience
4. Live Hitachi’s Values and evolve Hitachi’s culture for sustainable growth
5. Promote growth mindset with ownership of continuous self development including reskilling & upskilling
6. Promote and reward innovations & change : encourage innovation without fear of failure
7. Collaborate to overcome organizational silos to unlock the value of our customers
8. Establish “New Ways of Working”
9. Transform HR to provide more high-quality people services & solutions leveraging digital technology
Ensure mental and physical Health & Safety
Strengthen Risk Management (compliance, accidents/incidents, disasters, etc.)

Foundation

Qualitative and Quantitative Measures and KPIs Linked to Management Strategies
Management strategy(Business strategy)
MMP 2024 Goals

Management Target & KPI

Expand Social Innovation
Business globally to contribute to
the society
Global Growth by Digital, Greenand Innovation

1) Digital business growth by Lumada

Major Management Strategy

Boost business by Lumada· Revenue CAGR
5–7%· Adj. EBITA margin
12%· ROIC
10%· EPS CAGR
10–14%· Core FCF
1.2 trillion
Japanese Yen

Create destructive innovation by backcasting2) Improve margin of core business andreinforce portfolio management3) Increase sales by client- and market-­oriented business (Global expansion)

Achieve 10% Adj. EBITA margin and
10% ROIC in all businesses
Shift management resources to (=Focus on)
growth business
Boost business in regional markets(Reinforce regional strategy)(Group Health and Safety Policy)
Health and safety always
comes first.
*1 MaD!: Make a Difference! (employee idea contest)*2 JD: Job description

HC KPIs (examples)
Status of DEI promotion

Secure and develop digital talent required for business growth

Number of digital talents

Leverage digital talent and contribute to Lumada business

Lumada revenue and operating income

Promote innovations (Support the spirit of challenge)

Status of application to MaD!*1

Select and develop management leaders globally

Diversification of candidates for the leadership

Talent allocation based on “Right People in the Right Place”

Survey score (Right people in the right place)

Shift to job-based HR management in Japan

Status of Impl. JD* Survey Score (Career)

Improve employee engagement

Survey score (Engagement)

Foster global Hitachi culture
Cultivate growth mindset including reskilling and upskilling2

OutcomeMaximize added
value(B/S perspective)

Survey score (Growth and agility)

Establish “New work style”

Survey score (Way of working)Promote collaboration across divisions to achieve “growth”

Number of transfers and talent shifts between divisions

Optimize management foundation cost (Reduce SG&A)

Workforce Management

KPI defined in each BU/Gr. Company

Improve efficiency of balance sheet

Improve productivity of indirect divisions(Reform roles and streamline operation in HR division)

Indirect division KPISecure physical and mental health and safety

Health and safety KPI

Acquire clients in growth sectors and domains

4) Cash-oriented management

HR strategy to execute the left one
Promote diversity, equity, and inclusion

Optimize
invested capital(P/L perspective)

Introduction

SocialHuman Capital
Executive Summary	Global Human Capital Management

Management

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

074

People (Talent) —Optimize talent (workforce and capability) and engagement for growth—
Developing Global Leaders and Digital Talent
Approach

SystemActivities

GRI 404-2

Training

Work-Life Management

Management Leader Selection and Development

Occupational Health and Safety

Hitachi develops global management leaders, operating the Global Leadership Development Program (GLD), which is led by top

Strengthening Recruitment andDevelopment of Digital Talent Materiality

Freedom of Association andCollective Bargaining

management and the Nominating committee for the medium- to long-term development of management leaders who will drive

To accelerate our Social Innovation Business using digitalchange and innovation. To develop candidates for future positions as CEO, heads of business units, and other management

technologies and expand Lumada business (Revenue:­leaders, we select several hundred candidates from around the world to join GT+ talent pool. We provide these individuals withFY2021 1.4 trillion yen ➞ FY2024 2.7 trillion yen), a Hitachichallenging assignments* involving on-the-job and off-the-job training and coaching. We are happy to say that the percentage of

growth driver, we secure and develop digital talent who will

non-Japanese nationals and women among the selected applicants has been increasing year by year.

lead digital transformation (DX). In addition to acquiring talent

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

1

In addition, the GT+ group includes young and talented employees selected through the Future 50 program. The candidates

globally through GlobalLogic, a leading digital engineering

Quality and Customer Satisfactionin this program receive intensive training through work assignments, including management positions, and opportunities for direct

services company, we will accelerate our efforts to bolster

Social Contribution Activities

discussions with outside directors.

digital talent needed for business growth by engaging in

Social Data

*1 Assigning highly demanding tasks.

internal talent development through expanded programs
unique to Hitachi DX training.

Selection of Diverse Human Resources as Management Leadership Candidates
GT+
FY2016FY2022Future50 (Alumni,
current members)

521

541

140

Non-Japanese

25 (4.8%)

174 (32.2%)

42 (30.0%)

Female25 (4.8%)

122 (22.6%)

31 (22.1%)

Selected

Note: As of March 2023

CEO

Digital Talent: Progress and Targets
Japan

Candidates for leaders
such as Future CEOs

100,000

Talent Pool for
Leader Candidates:
“GT+”
541
Emerging Talents“Future50”140

FY2022 Results

Global Leadership Acceleration
Program for Key Positions (GAP-K)

Selective training held for five months to accelerate the development of
future management-level leaders

30 participants from 8 countries

Global Advanced Program for
Leadership Development (GAP-L)

Training held twice a year for local leaders whom we expect will perform
well in subsidiaries outside Japan, aiming to develop superior leadership,mindset, and skills necessary to drive Hitachi’s global growth businesses

57 participants from 18 countries

83,00067,00060,00041,00030,000059,00038,00040,000Management Leadership Candidate Training (Internal)
Overview

97,000*1

80,00020,000Training

Overseas(People)11,00035,00012,00019,00023,0002019

2020

29,0002021

42,0002022

38,0002024(FY)(Target)Note: We define digital talent as someone having capabilities in one of 12 areas(design thinking, data science, security, etc.) necessary for digital business.
Digital talent represents the total number of individuals under each capability(cumulative).
*1 Excluding Hitachi Astemo

Introduction

SocialManagement

Skill Level

Professional

Development Initiatives
Transfer and experience practical
digital businesses inside/outside of Hitachi [OJT]Advanced

Hands-onExperience

Work-Life Management

Direction

Advanced
Basic

Occupational Health and Safety
Freedom of Association andCollective Bargaining

Literacy

Diversity, Equity and Inclusion

Assurance

Hitachi Sustainability Report 2023

075

Hitachi Academy, a corporate university of the

Hitachi Group, plays a central role in developing digitaltalent. The academy established a DX training structurethat organizes, categorizes, and systematizes the processes and tasks needed for digital transformation.

Trainings (lectures) and exercises
at Hitachi Academy

MemberBasic

Digital Talent Development

e-learning in Hitachi Academy(For all employees of Japan group companies)

The DX training structure, which consists of morethan 100 courses. In fiscal 2022, a cumulative total of
29,500 employees took DX training across 130 courses,
is updated annually. In addition to an e-learning packagethat outlines the DX literacy minimums for all employees

No

TargetDescription①

Professional

Have knowledge in the specific area and can play an organizing/leading role on the area
in PJs②

Advanced and Basic

Have a practical experience in the specific area and can play an implementing role
under professionals’ guidance (Data scientist, security specialist, design thinker, etc.)③

Literacy(All Hitachi Gr. Employees inJapan)Have a basic digital knowledge, understand the fundamental content of Hitachi’s digitalbusiness.

Quality and Customer Satisfaction

Social Data

Role in Front BU

Leader	Global Human Capital Management

Social Contribution Activities

GovernanceDigital Task Team (Inside/Outside of Hitachi)

Executive Summary

Responsible Procurement

SocialEnvironmental

Digital Talent Development Methods

Human Capital

Human Rights

Social Innovationof Group companies in Japan the academy offers basic
and advanced training programs for each of the skills
required of digital talent. In this way, we strengthen thedevelopment of individuals who can apply DX to theirown work.
At the same time, we train leaders and other­professional-level digital talents in charge of DX projects
by providing them with on-the-job training in actual
projects and other practical work experience. We con-Initiatives to Put the Right Person in the Right Placetinue to strengthen digital talent through both basic andadvanced knowledge and skills training and develop-

Activities

The Hitachi Group created the Organizational Structure and Human Resources Allocation Policy, which stipulates the process ofconsidering the optimal organizational structure for achieving organizational goals, maximizing the performance of the entire organization, and securing and allocating human resources to optimize configurations. In this way, we ensure organizational and positional management placing the right people in the right positions. Our basic policy is to assign personnel that meet the competency
requirements of the position in question, utilizing human resources from a group-wide and global perspective, rather than using
age, gender, nationality, or other attributes of human resources as factors in making placement decisions. In addition to utilizing
external human resources, we conduct talent reviews to achieve a more optimal match between the job and the human resources
as part of the promotion of job-based human resources management. In conjunction with global performance management (GPM),
succession planning, and succession candidate development, we seek to achieve further growth for the entire Hitachi Groupthrough global talent management measures conducted in common at all Hitachi Group companies.

ment for professionals.

Introduction

SocialHuman Capital
Executive Summary	Global Human Capital Management

Management

Social Innovation

Environmental

SocialGovernance076

Hitachi Sustainability Report 2023

Assurance

Mindset (Culture)—Foster a mindset and culture for growth—
Fostering the Hitachi Culture and Improving Employee Engagement*1 Globally
Targets

GRI 404-2

Activities

Work-Life Management

Hitachi has welcomed approximately 100,000 new employees through several large-scale M&A transactions in recent years. We

Improving Employee Engagement

Occupational Health and Safety

will work with these new colleagues to share the universal Hitachi mission and values (founding spirit) and foster a culture as One

As part of human capital management, Hitachi established an

Hitachi, improving employee engagement and achieving further innovation and growth.

employee engagement score*3 as a KPI and is working to set

Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Materiality

As part of human capital management, Hitachi monitors employee engagement every year through Hitachi Insights, a global

and achieve targets. In fiscal 2022, we achieved our fiscal

employee survey. We plan and implement actions to improve employee engagement. Specifically, management and local supervi-

2024 target “employee engagement (percentage of positivesors share the survey results of their own organizations with their members to identify organizational issues, and continue theresponse rate) 68%” ahead of schedule, and now, we are

PDCA cycle through the planning and implementation of actions that serve as response measures, leading to improvement.

looking to achieve an even higher target.

In the fiscal 2022 survey, we expanded questions related to the environment and well-being, which require an accurate under-

Quality and Customer Satisfaction

standing globally. We increased the number of languages in which the survey is offered to 20 to meet the needs of diverse humanSocial Contribution Activities

resources and improve usability.

Social Data

*1 Employee engagement: The willingness of employees to work autonomously to understand a company’s strategies and policies, to take on challenges in their work, and toachieve results*3 Employee engagement score: Employee engagement is measured in terms offour factors (pride in working for Hitachi; Hitachi as a fulfilling workplace; feelingof personal accomplishment in work; and intention to continue to stay at
Hitachi for the foreseeable future)

Creating a Shared Culture During PMI*2

Results and Targets of Employee Engagement Score­(percentage of positive response rate)

Post-merger integration with GlobalLogic, Hitachi Energy, and other companies acquired via M&A is essential for creating growthJapansynergies. After conducting a survey to visualize the strengths and differences of each company, we hold town-hall-style meetings
at the leadership level and culture discussions at the employee level to foster unity under One Hitachi.

Overseas

Total

(%)
100

*2 PMI: Post-merger integration; refers to the integration process after M&A.

Communication to Integrate Corporate Cultures with New Colleagues

60

July 2022 was the first anniversary of the integration of Hitachi and GlobalLogic. Hitachi released a video message of congratulations and thanks globally, sharing the results of collaborative creation to date, as well as hopes and anticipation of

82.3

80.0

80

65.0
56.2

61.2

83.3

69.5

71.0
62.7

40

future growth. In October, GlobalLogic and Hitachi Digital held the Hitachi Digital Summit 2022 in the United States. At thissummit, executives exchanged ideas, while 11 customers and business partners, as well as 127 Hitachi executives andleaders, participated to solidify a foundation for collaboration.

20
0

2021

Mindset Reform: Make a Difference! (MaD!)
Since fiscal 2015, we have held an employee idea contest to strengthen the sense of ownership among employees. The number ofapplicants has expanded globally throughout the group, and our new colleagues from Hitachi Energy and GlobalLogic are participating actively, helping to spread the Hitachi culture. In fiscal 2022, a member of Hitachi Energy received the Gold Ticket, the highest award, for a new business proposal related to green business.

2022

2024 (Targets*4) (FY)

*4 We raised our fiscal 2024 target as we achieved the previous target ahead ofschedule in fiscal 2022.

Introduction

SocialExecutive Summary	Global Human Capital Management

Social Innovation

Environmental

SocialGovernanceInitiatives to Develop Talents as a Hitachi Culture
Activities

Human CapitalManagement

Training

Hitachi has traditionally placed great emphasis on developing human resources, including the establishment of the ApprenticeshipTraining School, a predecessor of today’s Hitachi Industrial Skills Academy, in 1910, the year of Hitachi’s own founding. The pedagogical principles established in 1959 as our Educational Guidelines emphasized the spirit of yueki (guidance through assistance)

Work-Life Management

and jikyo (endeavor through one’s own efforts). That spirit has been maintained to the present day. In addition to on-site training

Occupational Health and Safety

through work tasks, we are also expanding training programs globally across the Group to improve individual capabilities, skills, andFreedom of Association andCollective Bargaining

support the growth of each and every individual employee with the goal of developing employees who can contribute to resolving

Diversity, Equity and Inclusion
Human Rights

specialties. For managers, we provide global standard training by level for the growth of the Hitachi Group. We will continue tosocial issues.
Title-Specific Management Training

Responsible Procurement

Training

Overview

Global Leadership Acceleration Program forManagers (GAP-M, Ready to Lead)

Leadership training with common global content for managers and new managers

Quality and Customer Satisfaction
Social Contribution Activities
Social Data

FY2022 results
Held in eight regions (Japan, the UnitedStates, Singapore, Australia, the United
Kingdom, India, China, Korea) with 3,207
participants

Career Development Support
Hitachi, Ltd. has developed a broad range of career development support that focuses on internal careers, namely, an employee’s individual values, job satisfaction, and their personal meaning of work. The Hitachi Career Development Workshop (H-CDW)
is a career development program to provide direct support for individual career development. Through self-analysis, participantsconsider their future direction, their career goals, and their career path. After this self-analysis, participants engage in self-­
directed efforts to develop their career and abilities. Around 16,000 people have participated in the program so far (as of March
31, 2023) with a focus on employees in their thirties at assistant manager rank working as technicians, researchers, and administrative office positions.
In addition to those programs, we also offer programs targeting specific age groups such as career education for young groups
and training for middle-aged or older groups to help older employees prepare for the changes ahead in their careers.
We also operate a Career Consultation Room for employees to speak with professional counselors about challenges regarding
work, career, or interpersonal relationships.
We will continue to encourage self-understanding while respecting each employee’s individuality and personal aspirations. By
doing so, we will develop individuals with autonomy to think and act for themselves, supporting mutual understanding as a way offostering a sense of unity and teamwork, while capitalizing on individual engagement and motivation within the organization. We
provide support and create mechanisms to link individual abilities and creativity to the enhancement of organizational strength andperformance.

Assurance

Hitachi Sustainability Report 2023

077

Introduction

SocialHuman CapitalManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

078

Initiatives at Regional Headquarters to Develop Employee Skills
Hitachi is an organization with global operations, so our skills development programs are implemented primarily by regional headquarters in keeping with the focus of each region’s business operations and cultural environment. Through these efforts, we seek to identify and nurture our global leaders across the Group.

Executive Summary

Hitachi America, Ltd.

Hitachi Europe Ltd.

Work-Life Management

For employees in the Americas aspiring to become global leaders, in addition to a global

The company supports employees in Europe to develop skills to acquire professional certifica-

Occupational Health and Safety

management training program, the company provides a variety of learning and individual

tions in cultural awareness, presentation skills, and IT skills. Global management training andtraining options utilizing the Hitachi University. Specifically, the company encourages

other programs bring together Hitachi leaders in Europe which helps to build an important­employees to take e-learning courses on topics such as DX and AI/data science. To develop

network in support of One Hitachi. In addition, we are conducting education and training toleadership, it also actively encourages employees to participate in training programs forsupport hybrid work and improve employee engagement.

	Global Human Capital Management

Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement­management-level leaders. In addition, we place great emphasis on improving understandingof DEI and have developed and provided virtual training on DEI for all employees.

Hitachi India Pvt. Ltd.
The company’s Learning and Development Committee consists of senior executives andQuality and Customer Satisfaction

Hitachi Asia Ltd.

meets twice a year to discuss training programs. Another mission of the committee is toSocial Contribution Activities

Twice a year, business leaders gather to provide and share business insights and successencourage skill sets by making full use of global management training courses and theSocial Data

stories that develop human resources in line with Mission, Values, and Vision. In addition toe-learning platform for employees. In addition, to enable an effective learning and develop-

global leadership programs, talent management measures, coaching sessions by senior lead-ment, the company provides annual development roadmap and educational programs toers, e-learning platforms that can be learned online, we are developing measures to support

Group companies located in India.

the development and growth of human resources through on-site training and virtual skill
training. Employees communicate regularly with their superiors, and superiors support theirteams through resource support, coaching, and mentoring to build a system that takes initiative in their own careers.
Hitachi (China) Ltd.
The company promotes the growth of all employees through a training system catering todifferent levels of development which enables workers to develop the specialized and comprehensive skills they need to perform their jobs. In addition to common global training throughHitachi University and an e-learning platform for employees, we provide specific content for
employees to acquire the skills and knowledge required for business activities in China. It also
supports the development of Hitachi’s Social Innovation Business by strengthening training fortalent development related to digital business.

Introduction

SocialExecutive Summary	Global Human Capital Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

079

Transformation to Job-Based HR Management
Approach

Human CapitalManagement

Activities

Hitachi is accelerating the shift to job-based HR management. This shift involves clarifying the duties and necessary skills as well as experience and assigning human resources based on their desires andabilities to perform the required duties. Through job-based human capital management at Hitachi, assign the right people to the right jobs according to their personal abilities and motivations, regardlessof their attributes such as nationality, gender, or age. The aim here is to produce organizations and individuals that generate innovation by maximizing performance and by improving engagement.

Work-Life Management
Occupational Health and Safety

Specific Initiatives to Transition to Job-Based HR Management

Freedom of Association andCollective Bargaining

and human resources, and we conducted talent reviews to consider placement and training based on each the aptitude and career orientation of each employee. In October 2022, we introduced the Learning

Diversity, Equity and Inclusion
Human Rights

Engaging in job-based human resources management in Japan, we adopted job descriptions (for approximately 60,000 positions including Group companies as of the end of FY2022) to visualize job duties
Experience Platform (LXP), a system that supports autonomous upskilling and reskilling. On this platform, an AI interface recommends internal and external learning content according to the career aspirations,etc., of the employee in question. We are also promoting support for employees’ autonomous career development. We are offering LXP within Hitachi, Ltd. and to Group companies in Japan in stages.
In addition, we are reviewing the entire human resource management system and framework, aiming for completion between 2023 and 2024. As an example, in April 2023, we redesigned the

Responsible Procurement

Group Recruitment System to expand opportunities for voluntary transfers. In the future, we plan to introduce a system of internal and external side jobs, and revise the compensation system for

Quality and Customer Satisfaction

non-managerial personnel.

Social Contribution Activities
Social Data

This shift to job-based human resources management allows Hitachi to improve the job satisfaction of each individual, heighten the sense of unity between the company and the individual, andachieve growth for both parties.
Hitachi’s Job-Based HR Management“Growth” of organization and individuals, nurturing of “mindset and culture for growth”
Provision of value through the globally deployed Social Innovation Business andself realization of employees through work

Objectives· Maximization of performance of organizations and individuals· Improvement of engagement

Improvement of labor productivity

Realization of the right person in the right place: The company clarifies required job duties and skills and provides opportunities for developing skills
and utilizing the full potentials of employees while the employees demonstrate their own values necessary for job duties and builds their own careers.

Company

Visualization of job duties◆ Attractive job duties and opportunities for growth◆ Compensation according to job duties andachievement◆ Support for career development and autonomous
learning◆ Environment where diverse individuals can makefull use of their talent

Individuals
Provision of opportunities
and compensation
Partners on equal footing
under the keyword of work
Mutual communication
Achievements and contribution(Demonstration of values)

Visualization of human resources◆ Self-realization through work
◆ Achievements and contribution according to job
duties (Demonstration of value)◆ Continuous upskilling and reskilling◆ Mutual understanding in diverse groups anddemonstration of teamwork

Nurturing of mindset and culture for growth:Take the initiative in one’s future career and raise one’s hands, Learn on one’s own, Take on challenges , Learn from failure

Introduction

SocialHuman Capital
Executive Summary	Global Human Capital Management

Management

Social Innovation

SocialEnvironmental

Governance

Assurance

Hitachi Sustainability Report 2023

080

Organization —Promote collaboration between divisions and improve productivity and efficiency on a global basis for growth—
Adopt a Platform for Global Human Capital Management
Approach

SystemActivities

Work-Life Management

In the past, each Hitachi Group company conducted its own

Integrated Platform for Human Capital Management

Implementing People Analytics

Occupational Health and Safety

human resources measures and systems optimized for over-Through this platform, we share up-to-date and specific tal-

Hitachi’s People Analytics initiative involves gathering andFreedom of Association andCollective Bargaining

seas operations. However, we reorganized these measuresents information (professional skills, career preferences, etc.)

analyzing data about regular employee awareness and behav-

and systems into common global measures, common regional

via a cloud system. The platform enables centralized manage-

ior and putting the data to use in personnel allocation andmeasures, and individual company-specific measures. In par-ment of various processes, including search for talents acrossmanagement policy.

ticular, we are developing a global common human resources

the Group. We utilize this information for team management,

Rather than relying on the experience and intuition ofmanagement infrastructure to integrate with global sharedperformance management, development planning, and career

person in charge we visualize data to conduct talent manage-

Responsible Procurement

measures. In 2012, we began operating a database, conduct-development. The platform is gradually being expanded

ment based on improved decision-making accuracy, the char-

Quality and Customer Satisfaction

ing data management, and implementing global leadership

throughout the Group globally.

acteristics of the individual employee, and the aptitudes of theSocial Contribution Activities

development initiatives targeting certain top talent. We con-individual employee. In this way, we engage in effective andSocial Datatinue to expand our efforts through common job grading andprompt measures regarding our talent, organization, andDiversity, Equity and Inclusion
Human Rights

performance management, a global education platform, and a
global human resources management integration platform
infrastructure. Newly added companies become part of thesecommon platforms over time.

culture.

Introduction of the Human Capital Management
Integration Platform(10 thousand people)
30

Utilizing Survey Analysis Results for Human
Capital Management

28.9

We conducted a survey based on a unique psychological analysis developed under the academic guidance of

20

18.1
14.5

the University of Tsukuba. The results are analyzed

15.4

using IT, including AI and data analysis. We used indicators of individual awareness, as well as data on job

10

assignments and behavior arising from the survey

7.3

results to assign and develop employees. We also use
the survey results to maintain and improve organiza-

0

2018

2019

2020

2021

2022

(FY)

tional health and productivity. This practice strengthens
our human capital by energizing talent andorganizations.

Introduction

SocialHuman CapitalManagement

Social Innovation

Environmental

SocialGovernance

Hitachi Global Grade (HGG)
We engage in role- and job-based talent management through the Hitachi Global Grade and other systems to ensure that a diversebase of talent is engaged in pursuing the Hitachi business. The HGG consists of 11 grades, and each position is evaluated based

Hitachi Sustainability Report 2023

Assurance

081

Ensuring Fair Evaluation and Compensation
Approach

Systemon the global common standards of the entire Hitachi Group.

Executive Summary

Hitachi believes that a fair global system of employee evalua-Talent Review

tion and compensation is essential for attracting diverse

Work-Life Management

Hitachi uses the Talent Review as an initiative to strengthen and develop the match between duties and talent. Managers in each­talents, regardless of nationality. Accordingly, we established a

Occupational Health and Safety

workplace meet individually with subordinates to review performance and career plans, after which multiple managers have the

Global Compensation Philosophy: A management framework

Freedom of Association andCollective Bargaining

opportunity to review each employee. Managers then discuss individual development and job assignments based on the employee’s

shared by all Group companies based on the principles ofstrengths, weaknesses, and career aspirations. Through these efforts, we encourage the matching of duties and human resources,

ensuring market competitiveness, pay for performance, andleading to employee career development and stronger organizational capabilities.

transparency.

Global Performance Management (GPM)

each country and region in which we operate when determin-	Global Human Capital Management

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

We ensure compliance with the laws and regulations of
Global Performance Management (GPM) forms the foundation for business management and performance enhancement with theing compensation. For instance, to ensure compliance with

Quality and Customer Satisfaction

aim of promoting the sustainable growth of organizations and individuals. Five items, including the perspective of corporate ethics

minimum wages, etc., in Japan, we conduct comprehensive

Social Contribution Activities

and compliance, are particularly important for Hitachi to become a global leader in the Social Innovation Business. We define theseand periodic checks through our system to confirm no viola-

Social Data

items as common competencies (behaviors) for the Hitachi Group, and these items apply to all employees. Supervisors provide

tions have occurred.

coaching and feedback to their staff to help them achieve their targets. They encourage continuous performance improvements

We developed a performance-based compensation system

which lead to the medium- and long-term development of employees. By clarifying the skills and behaviors that individuals need tothat is fair and competitive in the context of the labor market for

demonstrate, while explaining how their actions contribute to the success of the business, we cultivate employee fulfillment at work

the industry in each country or region. Individual employee

while encourage employees to take ownership over their work and self-development.

compensation is based on an annual performance review.
Hitachi, Ltd. introduced a system of flexible compensa-

Hitachi Group Common Competencies
Competencies

tion according to individual employee performance andCommon Definition­company performance. In addition to evaluation results,
employees receive feedback on strengths and areas for

Safety and Integrity

Be bold to do the right thing for yourself and others.

Challenge (Pioneering spirit)

Be agile, and learn from failures to succeed.

goals for future work. This feedback is designed to encour-

Customer Focus (Sincerity)

Empathize with customers, and collaborate to create innovation.

age personal growth.

Collaboration (Harmony)

Speak up and listen respectfully to others.

GrowthBe hungry to grow yourself, other, and the organization.

improvement identified via evaluation and challenges andIntroduction

SocialHuman Capital
Executive Summary
Global Human Capital Management

Management

Social Innovation

Environmental

SocialGovernanceApproach to Work-Life Management
GRI 3-3

Approach

hours for flex-time work and discretionary work, allowing forplace, including a 41-hour year-on-year decrease in total

regular work days to become “non-work days.” In addition,

annual work hours per person in fiscal 2022.

Occupational Health and Safety

are simply balancing work and private life, to promote “work-

program) in April 2023, responding to diversifying needs for

Freedom of Association andCollective Bargaining

life management” which encourages employees to proac-time off. The expansion and use of these various programs

tively take charge of improving the quality of both their work

are part of our implementation of autonomous and flexible

and private lives. We embrace work-style reforms and sys-

work styles. And we are seeing changes in work styles taking

Human Rights

Hitachi, Ltd. Employees Eligible for
Remote Work and Satellite Office Programs

Approx.

95%

tems facilitating balance between work life and private life.
In this way, we support each individual in their path as a

Responsible Procurement

professional and as a growing human being, leading to sus-

Quality and Customer Satisfaction

tainable growth for the individual and for our organization.

Social Contribution Activities
Social Data082

we began expanding rest and vacation options through a Life
Support Leave program (multi-purpose, 100% paid leave

Diversity, Equity and Inclusion

Hitachi Sustainability Report 2023

Work-Life Management

Hitachi goes beyond “work-life balance,” in which employees	Work-Life Management

Assurance

Implementing Work-Style Reform
Approach

SystemActivities

Work-Style Reform Initiatives at Hitachi, Ltd.
Activity
Top commitment• Send message within company

Review operations andprocesses• Reform administrative operations at headquarters• Clarify rules for sending e-mails, prohibiting late-night and week-end e-mails in principle• Use support tool designed to optimize meeting durations and participant numbers and improve meeting efficiency

Strengthen workplace
management• Increase operational transparency using in-house consultants• Improve attendance management system for firm compliance• Offer training to learn effective remote workplace organizational management (Target: 16,000 Hitachi Group managers)

Promote time- and location-­
independent work practices• Expand working from home program• Create environments where internal networks can be accessed safely from off-site locations• Hold meetings online• Offer spot remote work for managers and employees eligible for discretionary work hours• Eliminate minimum daily work hours for flextime work and discretionary work
• Expand satellite office network (351 sites as of March 2023)• Reform administration by promoting electronic signatures and paperless systems

Companywide promotional
tactics• Share on Hitachi’s intranet site
• Raise employee ideas about work-style reforms and share them
• Conduct awareness surveys, etc., and publicize results

GRI 3-3

Hitachi pursues group wide work-style reforms to allow
diverse employees to work with enthusiasm and demonstrate
their talents. Today, approximately 95% of all Hitachi, Ltd.
employees are eligible to take advantage of our programs towork from home or satellite offices, enjoying work styles thatoffer ­flexible, time- and location-independence. Under these
programs, employees do not need to come into the office fora certain amount of time, and they may work outside theoffice without any limitations. Employees may also work at
locations where child care, nursing care, etc., are provided orwhere relatives reside. We also introduced location-free work
for managerial-level employees and employees eligible fordiscretionary work, which allow these individuals to work on a
spot remote basis. We have eliminated minimum daily work

Key Components

Introduction

SocialManagement

Social Innovation

SocialEnvironmental

Governance

Hitachi Sustainability Report 2023

083

Introducing and Expanding Support Systems for Balancing Work and Child Care/Nursing Care
GRI 401-2/401-3

SystemHuman Capital

Assurance

Hitachi strives to create even more supportive workplaces to

As Japan’s population ages, the number of employees

responsibilities. Specifically, we pursue efforts to offer a total

Executive Summary

help employees balance work and child care. For example,

facing the challenge of providing nursing care for elderly

integrated package (information, financial support, work style

Global Human Capital Management

Hitachi, Ltd. offers an allowance for balancing childcare andfamily members continues to grow. In response, we are pro-reform, and management reform) that allows employees towork, services to help enroll children in daycare centers, andviding more support programs to help employees balance

provide nursing care without having to quit their jobs, educa-

Occupational Health and Safety

other programs. The company also provides e-learning courses

work and nursing care. Hitachi, Ltd. and Group companies intion for managers and employees over the age of 40, andFreedom of Association andCollective Bargaining

to encourage a better understanding among managers. To help

Japan regularly conduct employee awareness and internal

free consultation services with experts in the field.

employees balance work and child care, we established anfact-finding surveys concerning nursing care. Based on thein-house child-care facility in one of our offices in cooperation

results of these surveys, the companies enhance measures

Hitachi Group companies in Japan to formulate a plan forwith the labor union and group companies.

to help employees balance their work and home nursing caremeasures to support balance between nursing care and work.

	Work-Life Management

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction

Work-Life Management Support System at Hitachi, Ltd.

Social Contribution Activities

Child-Care Support System

Social Data

For women

Pregnancy

For menFertility treatment leave (1 year total),
Expectant Parent seminars,
Pre-maternity leave and return to work support seminars
Leave for prenatal medical appointments, pregnancy problem leave, etc.

ChildbirthChild-careleave
Return to
work

Other
Programs

Maternity leave (8 weeks before
and 8 weeks after childbirth)

Nursing-Care Support System

Paternity leave (5 days total)

Child-care leave (up to 3 years, until the child completes
the first grade of elementary school; can be taken nonsequentially)
Child care and work support
allowance (up to 100,000 yen peryear per child through the third
grade of elementary school)
Hokatsu Concierge

Child-care matching service incollaboration with company-led
nurseries
Child-nursing leave (5 Days/Yr)

Flexible working hours
Shorter working hours (generally 6,
6.5, or 7 hours)
Annual paid leave (in hours)
Half-day leave
Family-nursing leave (5 Days/Yr)
Leave for overseas spousetransfers (3 years or less)Life Support Leave (5 Days/Yr)
Working from satellite offices
Working from home
Spot Remote Work
Elimination of posting of
employees away from family

Work/leave system enabling flexible work styles
Flexible working hours
Shorter working hours(generally 6, 6.5, or 7 hours)
Annual paid leave (in hours)
Half-day leave
Family-nursing leave (5 Days/Yr)
Child-nursing leave (5 Days/Yr)
Annual nursing-care leave(5 days per person receiving
care per year)

Nursing-care leave(1 year in total, can be taken
nonsequentially)
Life Support Leave (5 Days/Yr)
Working from satellite offices
Working from home
Spot Remote Work
Elimination of posting of
employees away from family

Financial support
Work-caregiving balance support points (1,000 points [100,000 yen]
per person receiving care per year)
Work-caregiving balance support points (3,000 points [300,000 yen]
per person receiving care)
Consultation services and information provision
Nursing Care Concierge (consultation service)
Distribution of Handbook on Balancing Work and Caregiving
Holding seminars on how to balance work and nursing care
responsibilities

Cafeteria Plan (child-care and nursing-care options)

By the year 2025, we intend to establish a system for allIntroduction

SocialManagement

Social Innovation

Human Capital
Global Human Capital Management

	Work-Life Management
Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion

SocialGovernance

Main Details and Purpose

ApproachSocial Data

Activities

Expectant Parent Seminars

E-learning for managers on balancing work and child care

Conducted to help managers understand basic knowledge for management and promotion of male employees to takechild-care leave in accordance with the revised Child Care and Family Care Leave Act

through balanced work schedules, Hitachi, Ltd. sets company-­

Tool to simulate salary andbenefits during child-care leave

Provides a visualization of salary and child-care leave benefits to support specific plans for the duration of child-careleave, etc., as well as to encourage the use of child-care leave

way, the company strengthens workplace management and

Employee Attitude Survey on
Balancing Nursing Care and Work

Conducted attitude and fact-finding surveys across all Group companies in Japan to understand current issues

Hitachi complies with the laws and regulations of each country and region concerning long working hours and overwork.
To maintain employee health and improve productivity
wide KPIs for work-style reform in Japan each fiscal year. In thisreviews business processes. We also offer e-learning programs
to ensure compliance with laws and regulations related toworking hours and annual paid leave. Projects that may involve
long working hours are managed on an individual basis. We

Responsible Procurement

Social Contribution Activities

084

Conducted for regular employees who are expecting a baby or whose spouse or partner is expecting a baby, topromote understanding of child care and child-care leave systems and to encourage regular employees to use thenecessary leave and work systems (seven seminars attended by 300 people in total)

Human Rights

Quality and Customer Satisfaction

Hitachi Sustainability Report 2023

Assurance

Preventing Long Working Hours and Overwork

Measures in Fiscal 2022
Measures

Executive Summary

Environmental

installed a system that links PC use to an attendance manage-

Support Systems and Measures that Meet Diverse Employee Needs

ment system as one way to manage long working hours and
GRI 401-2/404-2

Systemprevent overwork. We also provide a labor management dashboard*1 and send out alerts to help supervisors monitor the

Hitachi, Ltd. and the Hitachi Group companies in Japan

allowance plans. These plans respond to the diverse needs ofworking conditions of their subordinates in a timely manner,­promote to implement systems that provide the necessary

employees as they age by providing supplementary benefits

thereby supporting appropriate management in the workplace.

level of support based on the business environment of eachand the plans play an important role in allowing retired people

We are extending similar efforts to prevent long working hours

company and the needs of employees through domestic

to live more affluently.

and overwork using IT tools to Group companies in Japan.

programs and measures include the following: a Cafeteria

Employee Stock Ownership Plan

actual monthly working hours, accompanied with messages

Plan program; housing support such as dormitories,

Hitachi, Ltd. and certain Group companies in Japan havethat encourage behavioral changes. In this way, we help

­corporate-owned housing and a housing allowance system;

adopted an employee stock ownership plan to support asset

employees reflect on work styles and increase productivity on

systems for balancing work with child and nursing care; retire-

accumulation among employees and enhance their sense of

their own. Further, we provide monthly targets and specificment and pension plans; a consolation payment system; anparticipation in management. Under the employee stock

actions for eligible employees who worked 2,000 or more

employee stock ownership program; Hitachi Group insurance;

ownership plan, employees may receive incentive payments

total hours in the previous fiscal year, creating a culture

a property accumulation promotion system; internal sales;

based on Hitachi, Ltd. performance when acquiring Hitachi,change emphasizing work efficiency (achieving results inand a Health Insurance Society. In principle, these systems

Ltd. shares. This system links the growth of the company toshorter time) and resting once work is finished (recharging andand measures cover all employees except for certain systems

employee asset accumulation.

preparing for the next workday to maintain high performance).

The company provides all employees with a report ofGroup-wide lifestyle support programs and measures. Thesenot suitable for fixed-term contract employees due to the
purpose and/or nature of the system in question.

The shares held by the Hitachi’s Employee Stock
Ownership Plan ranks sixth in terms of major company shareholders (shareholding ratio: 2.10% as of March 31, 2023).

Retirement Benefit Plans
Hitachi offers partial or full defined benefit pension plans,
defined contribution pension plans, and lump-sum retirement*1 Labor management dashboard: A business tool that integrates and visualizes
information and data related to labor management

Introduction

SocialHuman CapitalManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

085

Initiatives at Regional Headquarters to Create Positive Work Environments
Hitachi supports workstyles that are conducive to each employee achieving their full potential. Regional headquarters also implement policies specific to their regions.

Executive Summary

Hitachi America, Ltd.

Hitachi (China) Ltd.

Hitachi India Pvt. Ltd.

Global Human Capital Management

Hitachi America, Ltd. offers a variety of programs and mea-

Hitachi (China) Ltd. pursues work-style reform to improve

Hitachi India Pvt. Ltd. offers programs and measures tosures to improve employee well-being. The company pro-productivity and support diverse work styles. The company

foster work environments where employees cooperate andvides a hybrid work system that allows employees to choose

offers remote work options and flexible work hours.

grow with each other. Specifically, the company provides awhether to come to work or work remotely, encouraging

Emphasizing work-life balance, average overtime hours are

remote work program for flexible work styles, support before

flexible work styles. In addition, a monthly No Meeting Day

well below the legally mandated maximum, and employees

and after childbirth, including day-care center allowance,

allows employees to focus on their individual work. Hitachi

are encouraged to take annual leave. Town hall meetings are

and group medical insurance. Hitachi India supports

America also sponsors monthly webinars to support theheld with ­executives, and interdepartmental businessemployee well-being through monthly health camps formental, physical, and financial well-being of employees,

exchange meetings are held to continuously enhance verti-

physical exercise and exercise programs in the workplace.

Responsible Procurement

while providing more opportunities for employees to interact

cal and horizontal communication within the workplace. The

Employees have access to webinars produced in collabora-

Quality and Customer Satisfaction

with each other.

network built through these meetings contributes to a sensetion with medical institutions that offer content on physical,of unity in the company, comfortable work environments,

mental, financial, and psychological well-being. Other pro-and smoother business operations.

grams include cultural events and family days to strengthen	Work-Life Management
Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights

Social Contribution Activities
Social Data

Hitachi Asia Ltd.

interaction among employees.

Aiming to make Hitachi Asia Ltd. the best workplace in Asia,
the company provides fair opportunities for all employees

Hitachi Europe Ltd.

and adopted a competency-based evaluation and compen-

Hitachi Europe Ltd. offers hybrid working arrangements tosation system. Hitachi Asia strives to treat and respect all

protect the health and safety of employees, as well as toemployees equally, bringing out the best in each. The com-

support diverse workstyles. In addition, staggered workpany also conducts activities to encourage communication

hours and other systems are used to encourage a better

among employees, engagement, health and safety aware-

work-life balance and help employees balance their work

ness, and mental well-being. Other programs allow for flexi-

and private lives.

ble work styles that take into account work-life balance.

Introduction

SocialHuman Capital
Executive Summary
Global Human Capital Management
Work-Life Management	Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights

Management

Social Innovation

SocialEnvironmental

GovernanceSocial Contribution Activities
Social Data086

Occupational Health and Safety
The Basic Principle for Occupational Health and Safety
Approach

GRI 3-3/403-1

PolicyHitachi communicates the Hitachi Group Health and Safety
Policy to all Hitachi Group companies worldwide in Japanese,
English, and Chinese. This policy is based on our philosophy
that Health and Safety Always Comes First. We coordinate
with all related companies, including contractors and procurement partners, to ensure the Group works together to create
safe, secure, comfortable, and healthy workplaces for all.

We instill our belief in everyone who works at the HitachiGroup that occupational injuries and illnesses can be prevented and that each of us is responsible for our own safety
and health. We also strive to actively adopt practices to protect our own health and safety and foster a culture of raisingmutual awareness.

Responsible Procurement
Quality and Customer Satisfaction

Hitachi Sustainability Report 2023

Assurance

Hitachi Group Health and Safety Policy
Health and Safety Always Comes First
Policies
In accordance with our mission, “Contribute to society through thedevelopment of superior original technology and products,” theHitachi Group will endeavor to ensure safe and healthy workplaces
under the principle of “Health and Safety Always Comes First.”
1. Continuously be involved in taking health and safety activities inorder to prevent occupational injuries and illnesses throughdesignating the health and safety of employees as management’s top priority
2. Comply with local laws and regulations regarding health and safety
3. Develop safe and comfortable work environments by encouraging employees to maintain their own health and by taking aproactive stance on health and safety activities in the workplace
4. Require an understanding of Hitachi’s principles and promotehealth and safety awareness for all business partners of the
Hitachi Group (contractors, cooperating companies, procurement partners, etc., involved in Hitachi Group business activities)
5. Contribute to safe and pleasant societies by emphasizing activities that make health and safety a top priority in all Hitachi
business activities

Establishing Occupational Health and Safety
Management System
GRI 3-3/403-1/403-2/403-3/403-4/
403-7/403-8/403-9/403-10

Structure

Our Safety and Health Management Division oversees­occupational health and safety on a global basis, holding the
Health and Safety Leaders Meeting every other month. Officers
in charge of health and safety at each Group company and thehealth and safety manager of each division attend the meeting
to develop strategies for companywide occupational healthand safety activities, to set targets and groupwide KPIs, and to
Occupational Health and Safety Management Structure
Hitachi, Ltd. headquarters
Audit Committee

Senior Executive
Committee

Report/deliberate Hitachi Group activities
policies/strategies/initiatives/results

confirm the progress of division initiatives. Participants also
work to improve occupational health and safety management
systems by analyzing the factors behind accidents and implementing detailed measures to prevent recurrence, sharing bestpractices, and implementing training.
The Senior Executive Committee receives reports anddiscusses the number of accidents and responses to occupational health and safety risks, the results of which are reported
to the Board of Directors.
In Japan, each business site or other location convenes amonthly health and safety committee, which is attended by thebusiness operators, labor union, and employees. Participants
analyze the factors leading to accidents and develop countermeasures, share information, and discuss health and safety
activities considering the situation regarding employees who
have taken sick leave. If serious injuries or fatal accidents
occur at work sites outside Japan, the Safety and HealthManagement Division may take direct action to support
improvement activities, depending on the circumstances.
The Hitachi Group has also obtained international certifications such as ISO45001 at multiple sites.
P.093 Labor-Management Cooperation Toward Improving Occupational
Health and Safety Levels

BUs/Group companies

Share activities policies/strategies/initiatives
in each Business Unit (BU)/Group company

Monitor KPIs, risk
assessment, andmeasures/activities for
major incidents

Safety and Health Management Division
Health and Safety Leaders Meeting
Attended by health and safety managers
and executive officers (CHRO, etc.)from each BU/Group company

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Group-wide business sites/
Factories

Instructions/communication of
Hitachi Group
activities policies/
strategies/
initiatives

Report KPIs, risk assessment, major
incidents, and results of activities

Introduction

SocialHuman CapitalManagement

Social Innovation

Global Occupational Health and
Safety Targets
TargetActivities

Materiality

Global Human Capital Management

global target of zero fatalities for workers, including contrac-

Work-Life Management

tors. In the previous Mid-term Management Plan 2021, inDiversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social Data

addition to a KPI related to fatalities, we included a KPI forlost-time injuries. The Mid-term Management Plan 2024
includes total recordable Injury frequency rate (TRIFR* ) as KPI,

087

Fatal Accidents and Total Recordable Injury Frequency Rate
(TRIFR)*4

to achieve our fiscal 2024 targets.

12*2 High-risk activities: (1) electric shock (high voltage), (2) work at high (3) industrial
vehicles (4) heavy lifting (5) machinery and equipment (6) confined space(7) toxic gases (8) fires and explosions

9

KPI

FY2024 Targets

FY2022 Results

3

Fatal accidents(Including contractors)

0 case per year

5 cases (Including 2cases at contractors)

0

Total recordable injury
frequency rate (TRIFR)

Half rate of fiscal
2021*3 by fiscal 2024

0.4

0.37
0.29

6

Safety Targets and Results (Hitachi Group)

Hitachi Sustainability Report 2023

Assurance

we continue to formulate action plans and strengthen efforts

To build a safe, accident-free workplace, Hitachi established a

Freedom of Association andCollective Bargaining

Governancefrequency rate in fiscal 2022 decreased from the previous year,

Executive Summary	Occupational Health and Safety

SocialEnvironmental

0.28

0.27

5

0.26
5

3
2

2

CY2021

FY2021

0.3

0.2

0.1

1

which is more comprehensive compared with lost-time injuries.
TRIFR is an indicator that encompasses not only fatalities andlost-time injuries, but also non-lost-time injuries. We established a global target to halve TRIFR by fiscal 2024 comparedto fiscal 2021.

0.0

CY2019CY2020

Number of fatal accidents

FY2022

Total Recordable Injury
Frequency Rate (TRIFR)

Note: W e used the statistical period between January and December of each year
in the past. However, in accordance with the safety targets set under our
Mid-term Management Plan 2024, we changed the statistical period for
total recordable injury frequency rate and fatal accidents to April throughMarch beginning in fiscal 2021.
*4 Discloses of TRIFR began in 2019.

*3 TRIFR in fiscal 2021: 0.27

To achieve these targets, we will foster group-wide efforts
in line with the following three strategic in the Mid-termManagement Plan 2024.
*1 TRIFR: Total Recordable Injury Frequency Rate (casualties per 200,000 work
hours)

0.26

0CY2018

Action Plan for Fiscal 2023
To achieve the Mid-term Management Plan 2024, we are conducting efforts on a global group-wide basis in fiscal 2023 pursuing

Three Strategic Pillars for Safety
Establish a Global Occupational Health and Safety
Management System
Strategic
Pillars

Utilize IT and Digital Technologies

the following action plan.
Action Plan for Fiscal 2023
Establish a Global
Occupational Health and
Safety Management System• Establish management systems at BUs and group companies, provide operations support and follow-up, establish aninternal audit system• Strengthen construction safety management involving front-line employees and contractors• Improve the quality of risk assessment and hazard prediction

Strengthen Human Capital

We regret to report five fatal accidents across the Hitachi Group

Utilize IT and Digital
Technologies• Establish global KPI management (accident rates, near misses, risk assessment information, etc.)• Centralize information management and visualization using ESG-MSS*• Conduct correlation analysis and predictive diagnosis of various AI-based disaster data, Hitachi Insights data, etc.

Strengthen Human Capital• Develop the Hitachi Group education and training system• Expand the global development of specialized safety training, create and introduce content for group-wide education, etc.
• Implement health and safety awareness measuresin fiscal 2022, including accidents of contractors. We will
strengthen our integrated safety management system, including
systems for contractors, by identifying risks and implementing
response measures related to high-risk activities*2 and equipment (electric shock, work at heights, heavy objects, etc.).
Although the Hitachi Group’s total recordable injury

5*5 ESG-MSS (ESG Management Support Service): A cloud service developed by Hitachi to conduct sustainable management by streamlining the collection, visualization, andanalysis of ESG data within a company

Introduction

SocialHuman CapitalManagement

Social Innovation

Occupational Health and Safety Risk
Assessment
Activities

SocialEnvironmental

Governancecompany presidents, and other bodies, about important

Assurance

Hitachi Sustainability Report 2023

088

of the issues identified.

issues such as fatal accidents and potentially serious events.

During fiscal 2019 and 2020, we focused on activities that

The results of monitoring incidents requiring improvement inbuilt a foundation for understanding the current situation andparticular are reported to the Senior Executive Committee

solving problems. In fiscal 2021, we performed independentand at meetings of Group company presidents.

outside safety analyses for a fatal accident at a Group company

Executive Summary

Hitachi establishes and manages its own standards for high-Global Human Capital Management

risk activities and equipment as a common global measure andWork-Life Management

pursues occupational health and safety activities that match theExternal Audits

in the relevant region, reconsider our action plans, andcharacteristics of each company’s business. We are working to

In fiscal 2018, Hitachi commissioned independent external

improved safety awareness.

adjust high-risk activities and equipment in all BUs, implement-

audits on safety diagnostics at four sites in Japan. The audi-

In fiscal 2022, we implemented the initiatives listed in theing measures and making investments to reduce risk in addition

tors identified issues (see the table below) requiring attention

table below. In fiscal 2023, we plan to conduct a safety aware-to measures to prevent occupational accidents under clearly

to comply with Hitachi Group Health and Safety Policy, andness survey through an external entity.

defined safety managers at the business site level.

we are making continuous improvements in response to each	Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights

We have a global monitoring system in place to identify,

Responsible Procurement

evaluate, and introduce countermeasures related to risks, andQuality and Customer Satisfaction

conduct internal audits into the status of risk assessment forSocial Contribution Activities

locations that are determined to have significant risks. We lever-Social Dataage IT and digital technologies for accident prevention. Further,
the Safety and Health Management Division reports global
accident statistics monthly at Senior Executive Committee
meetings to understand facts related to injury statistics.

Hitachi Group Risk Assessment Guidelines
Hitachi established the Hitachi Group Health and Safety
Management System Standards, which meet the requirements of ISO45001. We pursue risk mitigation activities
based on the Hitachi Group Risk Assessment Guidelines
in line with the standards.
New and existing businesses at Group companies

outside of Japan. We strengthened health and safety systems

Issues Identified
Establishment ofGroup-wide safety
management
systems
Raising safety
awareness among
employees bystrengthening
leadership at theorganization’s top
management
Clarify accountability for implementing
safety activities andexpand basic
countermeasures inthe event of an
accident

also follow the guidelines in conducting risk mitigation
activities.

Items requiring response• Build and operate an

occupational global healthand safety management
systemClarify rules and processes

Actions taken in FY2022• Established and rolled out company and group regulations for Hitachi Group Health and Safety
Management Rules and Hitachi Group Health and Safety Management System Standards• Established and rolled out guidelines in line with Hitachi Group Health and Safety Management
System Standards, including Risk Assessment Guidelines, On-Site Construction Safety

Management Guidelines, and Internal Audit Guidelines•• Transform ways of thinking • Conducted specialized safety training by grade (management executives, line managers, personnel
to encourage voluntary
health and safety behaviors
through training

in charge of safety)• Launched commendation program (Health and Safety Awards)• Held top management discussions between the general manager and deputy general manager of

the Safety and Health Management Division together with BU heads (18 BUs and Group companies)• Conducted visits to domestic and overseas business sites: 61 business sites (including 12 overseas
business sites)• Utilize risk assessment• Reported on risk assessments related to high-risk activities and shared progress at various meet-• Build a framework for• Established a system for conducting management system audits by Group corporate• Checked measures meant to reduce the risks of important work
• Began monthly reports of global accident statistics• Set global KPIs for accident occurrence rates, near-misses• Considered the use of security camera systems (system to confirm the use of fall arrest devices),

effectively•

identifying and mitigating
risks
Digitize and improve datareports using IT/digitaltechnology

ings (Senior Executive Committee meetings, Health and Safety Leaders Meeting, etc.)

and expanded use of vehicle dash cams to prevent accidents• Promoted proper use of accident investigation system/accident investigation database

Implementation of Health and Safety Training
Internal Audits
Policies, plans, and performance of occupational health andTraining

GRI 403-5

safety activities are reported to the Audit Committee on an

To prevent occupational accidents, Hitachi aims to rebuild aemployees. Each Hitachi Group company distributes work

annual basis for discussion. Reports are made at least once

culture of safety by implementing appropriate occupationalguidelines and procedures relating to their own business anda year to the Senior Executive Committee, meetings of Group

health and safety training for all executive officers andindustry. We also conduct safety-focused training at eachIntroduction

SocialHuman Capital
Executive Summary

Management

Social Innovation

Construction Safety Management Guidelines, a set of guide-

each organization and business type, for line managers andlines for standard Hitachi Group safety management systems

safety staff and for workers engaged in specific hazardous

common to off-plant sites, and are working to improve inte-

activities in the field. We provide individual guidance to new

grated safety management, including contractor safety.

higher risk of injury. We perform this training through on-thejob training to increase awareness and understanding of work

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Assurance

089

Hitachi Sustainability Report 2023

The Hitachi Group Sustainable Procurement Guidelines
also stipulate matters related to health and safety.
Hitachi Group Sustainable Procurement Guidelines
https://www.hitachi.com/procurement/csr/EN_HG_SPG.pdf

hires and temporary workers in particular, as they are at aWork-Life Management

Freedom of Association andCollective Bargaining

Governanceorganizational level, as well as education and drills tailored to

Global Human Capital Management	Occupational Health and Safety

SocialEnvironmental

procedures and dangers before engaging in work.

Initiatives to Improve Employee Health
Targets

GRI 403-6/403-10

Activities

Hitachi believes that improving employees’ wellbeing is essential

Health Support Initiatives in Japanagement executives to strengthen awareness of and build

for sustainable growth, so we endeavor to create workplaces in• Provide occupational health services at health management centerscommitment to roles and responsibilities concerning safety.

which all Group employees work in safety and health, both

Following training, we also evaluate changes in awarenessmental and physical. In fiscal 2020, we added questions relat-• Health maintenance measures provided based on periodic medical

and behavior through one-on-one interviews with external

ing to wellbeing to our annual Global Employee Survey, and• Medical interviews and advice to prevent mental and physical disor-

We conduct safety-focused leadership training for man-consultants. As of fiscal 2022, we held 30 training sessions

we expanded these questions in fiscal 2021. In the future, we

Quality and Customer Satisfaction

attended by 415 participants (including 11 sessions in English

will consider appropriate measures based on responses

Social Contribution Activities

and Chinese for 101 participants from outside Japan).

related to employee wellbeing.

Number of Participants in Training

Targets for Health in Japan

Number of Participants

Training

FY2020

FY2021

FY2022

Management executives
training (BU CEOs, Group
company presidents, etc.)

104

138

173

Line manager training

86

228

37

Safety personnel, line
manager safety instructor
development training

57

—

146

In Japan, we implement health management measures on asteady basis, strengthen mental health support in accordancewith new work styles, and strive to eradicate employee lifestyle-related diseases. Over the medium and long term, we
will implement measures based on Group-wide policies after
ascertaining the actual conditions and identifying issues
related to occupational health measures globally.

Ensuring the Occupational Health and Safetyof Contractors
Approach

Activities

Hitachi strengthened safety management systems, includinglaws and regulations, rules, and operations, at sites outsideplants based on accidents involving contractors during construction, installation, service and maintenance work at sites
outside plants. We also established and deployed On-Siteders among employees working long hours• Consultations and guidance by occupational healthcare workers toaddress employee health concerns and encourage regular exercise

FY2022
Results

human capital development of occupational healthcare workers
through regular meetings, study groups, and training sessions attended
by both occupational healthcare workers and human resources staff• Implement approaches to encourage highly stressed persons identified
under the stress check program to receive guidance from a physician,as well as meet with internal and external consultation offices, etc.
• Establish environments in which employees are comfortable approaching EAP*3 consultation desks, both internally and externally, to access
opportunities to resolve a wide range of concerns as early as possible.
• Have counselors approach employees based on daily mood changes(smartphone app)
*3 EAP: Employee Assistance Program

Targets and Results for Health Management(Hitachi Group companies in Japan)
FY2022
Targets

exams and other examinations to prevent serious disease• Qualitative improvement of occupational healthcare activities and theP.076 Improving Employee Engagement

Social Data

that support communities and businesses

FY2023
Targets

Rate of mental illness

Less than
0.7%

0.74%

Less than
0.7%

Implementation rate for
specific health guidance*1

50% or moreof employees

21.1%*2

More than55%*1 Specific health guidance: Support by professional staff (public health nurses,
dietitians, etc.) to review lifestyle habits for persons at high risk of developing
lifestyle-related diseases and for whom lifestyle-related diseases can be prevented to a large extent through lifestyle improvements.
*2 As of the end of June 2023

Employees on Leave Due to Mental or Physical Reasons(Hitachi Group companies in Japan)
CY2018CY2019CY2020CY2021

CY2022

Mental

0.64

0.65

0.62

0.66

0.74

Physical

0.24

0.25

0.22

0.21

0.24

Note: P
 ercentage of employees taking sick leave for seven or more consecutive
days and taking formal leave (number of employees taking sick leave permonth/number of employees per month × 100)

Introduction

SocialManagement

Social Innovation

Addressing Mental Health
Activities

Human Capital
Executive Summary

Hitachi established measures addressing mental health for
employees, workplace managers, occupational healthcare

Work-Life Management

divisions. We communicate basic mental health knowledge

Human Rights
Responsible Procurement

Hitachi Sustainability Report 2023

Assurance

Self-care (individual)

Mental health education

ability of those in positions of authority to respond to theseissues. The mental illness incidence rate among employees infiscal 2022 was 0.74%, therefore we continue to take a proactive approach to increases in mental strain caused workstyle changes, diversity, etc.
(1) Regular one-on-one interviews

Social Contribution Activities(2) Expand system for remote consultations with occupational

Preventive
management(while healthy)

Health improvement
activities (Seminars
and health guidancefrom occupational
physicians)

Human resources
divisionLine Care (superior)Working environment improvement
workshops, etc.

• Stress coping seminars• External and internal EAP
consultations and otherconsulting services• Stress-check approach forhighly stressed employees• E-learning for all employees(self-care)• EAP corporate
diagnosis• Line care training• 360FBP*1

Workplace management(3) Offer EAP consultation desks

Training andeducation
Workplacemanagement
guidance
Reduction oflong working
hours(4) Individual interviews with employees who are stationed atcustomer company(5) Tips for working from home posted on the intranet
working from home(7) Implement approaches to encourage consultations andinterviews with internal/external consultations offices forhigh-stress individuals identified by stress checks(8) Provide a handbook for care by line managers when working from home
(9) Provide e-learning contents related to self-care and careby line managers in light of changes in work styles
We will also clarify which target levels require special attention
based on our global employee survey and the opinions ofoccupational physicians, taking an effective and active

Condition
management(at beginning of andduring absences
and leave)
Management toprevent recurrence(from decision
to return to after
returning to work)

Repetition
management(during repetition
after return to work)

Mental health consultations during medical
exams
Health consultations

Health consultations

Workplace management

Health exams ofvarious types

Various types of healthexams

Regular consultations
Support for returning towork

Programs supporting
return to work

Leave system

Handbooks for
employees taking leave(6) Identification of health issues using a survey of employees

Indicator
management(while mentally
unhealthy)

Trial return system

Regular consultations

Regular consultations

Consideration of tasks upon return
Regular consultations
Follow-up status checks after
return to work

Collaboration to support return to work
Regular consultations*1 360FBP: 360-Degree Feedback Program.

Guidance to external ­facilities
supporting return to work

Management of
those working
extensive
overtime
Management of
employees on
leave
Programs
supporting
return to work
Regularconsultations

Training for human resources staff

E-learning; “Thinking about
mental and physical health”
versions 1–3

physicians

approach to self-care and line care.

090

Stress-check system specified in law

and understanding of ways to deal with stress and raise theQuality and Customer Satisfaction

Social Data

GovernanceHandbooks for managers
E-learning for managers (Line Care)

Diversity, Equity and Inclusion

Occupational physiciansand occupational­healthcare workers

GRI 403-6

workers, health and safety division, and human resources

Freedom of Association andCollective Bargaining

SocialInitiatives Addressing Mental Health at Hitachi

Global Human Capital Management	Occupational Health and Safety

Environmental

Introduction

SocialManagement

Social Innovation

Promoting Collabo-Health*1

Executive Summary

Governance091

Hitachi Sustainability Report 2023

Assurance

Encouraging Employees to Receive Medical Exams and Quit Smoking
GRI 403-6

Activities

Human CapitalSocialEnvironmental

GRI 403-6

Activities

Group companies in Japan carry out individual health

In Japan, Hitachi established a system offering financial sup-cerebral strokes, and myocardial infarctions. In fiscal 2022,

improvement initiatives according to their own unique charac-

port for medical exams by the Health Insurance Society. We

we offered a new team-based smoking cessation program

Global Human Capital Management

teristics. Further, Group companies in Japan strive to maintainencourage employees aged 35 and over to receive generalcalled Minchare to mitigate the reluctance to visit smoking

Work-Life Management

and improve the health of employees by taking full advantage

physical and other exams specified under law, as well as

cessation outpatient clinics due to COVID-19 and promoteof the services offered by the Hitachi Health Insurance

targeted screening based on age, for the early diagnosis andsmoking cessation for employees working at home. A total ofSociety*². Hitachi also ensures that all Group companies

treatment of lifestyle-related diseases, cancer, etc.

515 individuals participated in the program, the largest	Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Furthermore, as a response to the rise in metabolic

number to date, and a significant 49%, or 248 people, quit

Management Organization Recognition Program by Ministry of­syndrome, and in addition to special health guidance madesmoking—far more than results from outpatient smoking

Economy, Trade and Industry. We evaluate health promotion

compulsory for the Health Insurance Society, we pursue

cessation clinics.

initiatives on an annual basis, giving recognition to the mostpolicies to prevent and control conditions such as diabetes,

become certified under the Health and Productivity

accomplished companies and BUs within the Group to

Quality and Customer Satisfaction

heighten motivation among business owners and employees

Social Contribution Activities

to pursue such activities.

Social Data

*1 Collabo-Health: A concept involving insurers, such as the Health InsuranceSociety, who work proactively with business owners to establish a clear divisionof labor and form positive working environments that prevent illness improve thehealth of insured persons (employees and their families) effectively and efficiently.
*2 Hitachi Health Insurance Society: Hitachi Group employees and their families
are members of this organization which is one of Japan’s largest health insurance associations. As of the end of March 2023, there were 172 participating
corporations and 388,575 insured persons (199,458 members and 189,117
dependents).

Medical Exam and Screening Attendance Rates(Hitachi Group companies in Japan)
(%)

100.0
93.2

▼

81.3 80.6
80.0
●
●
◆
79.3

Category

FY2020

FY2021

FY2022Large
companies

58/95 companies(Including sevenwith “White 500”
status)75/87 companies(Including fourwith “White 500”
status)78/80 companies(Including fourwith “White 500”
status)Small-andmedium-sizedcompanies

41/75 companies(Including threewith “Bright 500”
status)66/70 companies(None with
“Bright 500”
status)65/66 companies(including two
with “Bright 500”
status)

96.8

95.8

▼

▼

83.0 82.2●●◆

83.5 82.7
●
●
◆
81.2

81.1

98.0

▼

85.5 84.7
●
●
◆

80.6

(%)

98.7

40.0

87.3
●
●
86.5
◆
82.4

30.0

▼

30.9

29.8

28.4

27.6

27.0

2020

2021

2022 (FY)

20.0
60.0

Number of Hitachi Health Insurance Society Member
Corporations Certified Under the Health and Productivity
Management Organization Recognition Program(Hitachi Group companies in Japan)

Smoking Rate Trend(Hitachi Group companies in Japan)

53.2
■
40.0

37.1

56.3
■

56.6
■

57.1
■

38.7

39.1

39.3

▲

▲

2018

2019

▲

▲

58.4
■

40.9

▲

0

2018

0

General physical exam*1
Uterine cancer screening*3
Intestinal cancer screening*4

10.0

2020

2021

Breast cancer screening*2
Stomach cancer screening*4
Lung cancer screening*5*1 Men and women aged 35 and over
*2 Women aged 30 and over
*3 Women aged 25 and over
*4 Men and women aged 30 and over
*5 Men and women aged 35 and over2022 (FY)2019

Note: Employees aged 35 and over (results of specific medical examinations)Introduction

SocialHuman CapitalManagement

Social Innovation

Health Promotion Initiatives for
Employees and Their Families
Activities

Environmental

SocialGovernance

Addressing Infection Prevention andOther Global Health Issues
GRI 403-6

Activities

Hitachi Sustainability Report 2023

Assurance

092

Health and Safety Considerations for
Nuclear Businesses
GRI 403-6

Approach

Activities

GRI 403-7

Executive Summary

To encourage healthy lifestyles among employees and their

We endeavor to prevent the spread of infectious disease

Since 2008, Hitachi has worked with the world’s leading

Global Human Capital Management

families, the Hitachi Health Insurance Society established aoverseas, including COVID-19. To this end, we provide infor-

nuclear power plant operators to develop voluntary, private

Work-Life Management

portal site for individuals called MY HEALTH WEB. By provid-

mation for employees posted overseas and business travelers

principles of conduct covering the export of nuclear power

ing information on health exam results and a system of incen-

regarding vaccinations for hepatitis A, tetanus, cholera, etc.,

plants and reactors. The Nuclear Power Plant and Reactor

tive points allowing employees to receive rewards for entering

according to the health conditions in the destination country.

Exporters’ Principles of Conduct were formally announced onhealth-related activities, the site raises health awareness,

We also offer vaccinations at in-house health management

September 15, 2011.

helps employees understand the state of their own health,centers or outside medical institutions. We also post informa-and offers a range of support for adopting healthier lifestyles.

tion on the Hitachi Group intranet to help travelers and theirinternal management systems and perform evaluation of

Responsible Procurement

In fiscal 2022, we introduced the Risk Simulator, a service

families to live safely, providing warnings for personnel living

radiation damage (dose management) for employees andthat predicts the risk of hospitalization for eight major diseases

overseas about infectious diseases including malaria, one ofother persons employed at nuclear sites under the Hitachi

Quality and Customer Satisfaction

based on the results of a medical checkup. Nearly 60,000

the three major infectious diseases in the world. Information

Group umbrella. For health management in particular, ourSocial Contribution Activities

people took advantage of the service.

includes descriptions of symptoms, prevention, and what tomanagement indicators for radiation exposure are stricter than

do if one contracts a disease.

those set by Japan’s Ministry of Health, Labour and Welfare.

	Occupational Health and Safety
Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights

Social Data

We provide a variety of health services aimed at improving
health literacy, and the employee registration rate for MY
HEALTH WEB surpassed 80%.

Achievements in Fiscal 2022
To encourage regular checkups, Hitachi added offers an
online service that allows for employees and their families to make appointments for medical examinations
using MY HEALTH WEB. And to encourage spouses
and other dependents to receive health checkups, webegan providing health information and health checkup
reservation services via LINE in fiscal 2022.
In addition, we launched the Autumn Healthy
Learning Walk campaign in October to support exercise
habits during COVID-19. The campaign lasted threemonths and inspired participants to learn about healthwhile walking an online course, with about 40,000
people participating.

We perform thorough exposure management based on

In Japan, the Health Insurance Society offers an incentive

We monitor physical and mental health along with exposure

point system to reward influenza vaccine recipients, including

doses for employees and employees of partner companies.

employee family members, with the aim of preventing influ-

An occupational physician from Hitachi visits sites to perform

enza outbreaks in the workplace. As an initiative to prevent

examinations and offer health advice.

contracting influenza, we recommend employees get vaccinated prior to the flu season. Nearly 80,000 employees andtheir families take advantage of the program every year.

Nuclear Power Plant and Reactor Exporters’ Principles of Conduct
https://www.hitachi-hgne.co.jp/en/principle/index.html

Introduction

Management

Social Innovation

Environmental

SocialSocialFreedom of Association and Collective Bargaining

Human Capital

Respecting the Rights of Employees

Executive Summary
Global Human Capital Management
Work-Life Management
Occupational Health and Safety	Freedom of Association andCollective Bargaining
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social Data

Approach

GRI 2-25/2-30

Hitachi respects and supports human rights as recorded in the
ILO Declaration on Fundamental Principles and Rights at Work.
The Hitachi Group Code of Ethics and Business Conduct,common throughout the Group, provide for compliance with thelaws of each country and region, as well as for the upholding of
the fundamental rights of employees in line with international
standards. We respect freedom of association, the right to organize, and the right to collective bargaining as human rights thatare particularly relevant to the workplace. Onboarding training
and the Hitachi Group Corporate Ethics Month (annual) represent
some of the ways we strive to help employees understand theserights. In addition, we have signed the United Nations Global
Compact, which states, “businesses should uphold the freedomof association and the effective recognition of the right to collective bargaining” of employees.
Hitachi Group Code of Ethics and Business Conduct
https://www.hitachi.com/corporate/about/conduct/pdf/conduct_e.pdf

Mutual Communication Between Employees
and Management
SystemGRI 403-4/407-1

The relationship between employees and management at Hitachi,Ltd. and Group companies in Japan is stable with healthy ongoing dialogue.
In Japan, Group companies ensure the three fundamental
rights of labor unions (the right to organize, the right to collective
bargaining, and the right to collective action). We strive to promote mutual understanding through dialogue between employees and management throughout the entire Group. In addition,
the Central Management Council, the Business UnitsManagement Council, and the Business Sites Management
Council work to enhance mutual communication between
employees and management. These efforts contribute to smoothmanagement and business development, improving working

Governanceconditions for union members. We traditionally negotiate with the
Hitachi Workers Union between February and March each year
to determine wages, bonuses, and collective agreements for the
next fiscal year. We have also established 14 committees, advisory panels, and roundtable conferences, including the Next 100
Labor and Management Committee, the Central Wages
Committee, and the Employment and Work Style Advisory
Panel, to meet one to four times a year to share information,exchange opinions, and hold discussions.
All Hitachi, Ltd. employees, with the exception of management, can join the Workers Union, and the membership rate isapproximately 96% as of March 31, 2023. The ratio of employees
belonging to labor unions, etc., in major Group companies inJapan (70 companies) is roughly 99%.
At Hitachi, Ltd., we also hold quarterly Hitachi Group management meetings with the labor unions of group companies inJapan that belong to the Federation of Hitachi Group Workers
Unions (FHGWU) to share information and exchange views andopinions on Group business conditions. In addition, we haveestablished five round-table conferences and committees, suchas the Hitachi Group Health and Safety Roundtable Conference,
which each meet once or twice a year to share information andexchange opinions.
Group companies outside Japan also pursue dialogues withindividual labor unions and their representatives in accordancewith the laws and regulations in each country and region. These
dialogues deepen mutual understanding of employee working
conditions and treatment, as well as business conditions. For
example, Hitachi Europe holds an annual European LaborManagement Council meeting to provide a forum for management and employees to exchange views on the Group’s businessenvironment and strategies. Hitachi China holds an annual management information meeting with the industrial association (labor
union) to facilitate smooth communications with employees andshare information on business conditions and issues. In addition,
the company and the industrial association concluded collective
agreements on working conditions, wage revisions, the protectionof female employees, and other matters to protect the rights andAssurance

Hitachi Sustainability Report 2023

093

interests of employees.
In fiscal 2022, no Hitachi Group operating sites reported
violations of freedom of association and the right to collective
bargaining.

Notification of Work-Related Transfers andReassignments
SystemGRI 402-1

The collective agreement between Hitachi, Ltd. and the Hitachi
Workers Union states that any transfer or reassignment of an
employee for work-related reasons should adequately take into
consideration the situation of the employee as well as requiring
the company to promptly inform the Hitachi Workers Union of
the decision. More specifically, the company consults with theunion regarding basic matters related to large-scale transfers,
reassignments, or moving the company.

Labor-Management Cooperation toward
Improving Occupational Health and Safety
Levels
Structure

Hitachi, Ltd. and the Hitachi Workers Union are dedicated to
improving occupational health and safety levels throughemployee management cooperation. This includes signing acollective agreement on the promotion of, among other things,
occupational health and safety measures, a health and safetycommittee, education and training programs, and health checks
for employees.
The Health and Safety Committee works with Group companies in Japan to ensure a healthy and safe work environment
through initiatives that include formulating and tracking an annual
occupational health and safety plan. The committee also reviews
measures to prevent occupational accidents and shares information on the health checkup status.
P.086 Occupational Health and SafetyIntroduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

094

Diversity, Equity and Inclusion

Human Capital

Diversity, Equity and Inclusion	Executive Summary
Diversity, Equity and Inclusion
Human Rights

Basic Concept
Hitachi believes that diversity, equity, and inclusion are sources of innovation and growth. We have a place for everyone, welcoming differences in background, age, gender, sexuality, family
status, disability, race, nationality, ethnicity, and religion. We believe DEI is essential to understanding the marketplace, generating great ideas, and driving innovation that contributes to theadvancement of society. We aim to be a company in which every person makes a positive contribution, treating everyone fairly and giving full consideration to individual differences. With adiverse workforce, broad experience, and an inclusive culture, we will meet our customers’ needs and drive our company’s sustainable growth.

Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities

Topic

Social Data

Overview

Targets, KPIs, and Results

We pursue DEI with global and regional perspectives under the leadership of the Chief Sustainability
Officer based on our DEI policy and strategy. Specifically, we focus on and develop programs
Diversity,
Equity andInclusionaccording to three common global DEI topics: 1. Gender 2. Culture 3. Generation. Additionally, withthe aim to become a diverse and inclusive company, we established the Hitachi Global DEI Council
to discuss specific activities concerning DEI strategy pursued by Group companies around theworld and throughout our global operations. We have also established Regional DEI leaders in eachregion to promote DEI in ways that take into account individual regional characteristics and business strategies.

*1: Included assignment as of April 1, 2023

Ratio of Female and Non-Japanese Executive andCorporate Officers
FY2030 Target: 30% (each)
FY2022 Results: Female 11%

Non-Japanese 20%*1

Introduction

SocialHuman Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

095

Diversity, Equity and Inclusion
Approach to Diversity, Equity and Inclusion(DEI)
Approach

PolicyGRI 3-3

Diversity:

Inclusion:

Diversity refers to the various differences that exist within

Inclusion is a state in which the uniqueness of each person is

individuals and groups.

recognized and each person contributes their best to the

In Hitachi, Diversity means that there is a place for every-

organization.

Hitachi aims to be a diverse and inclusive company in which every

one, regardless of background, age, gender, sexuality, family

employee is welcome, treated equitably, and feels included.

status, disability, race, nationality, ethnicity, religion and many

heard, and involved. For colleagues to feel included means

In Hitachi, Inclusion means that everyone feels respected,

Hitachi is committed to implementing DEI is a crucial

other characteristics. We embrace and value all differences.

being accepted, valued, comfortable to speak up, andQuality and Customer Satisfaction

driver to achieve sustainable business growth and create

Social Contribution Activities

value for society by preserving planetary boundaries andEquity:thetic culture and attitude. Including the different voices andSocial Data

improving people’s wellbeing. Diversity is critical to unlock

Equity means fairness of treatment, making adjustments tovaried perspectives that diversity brings enables us to reachinnovation, but diversity per se is not enough. To leverage

account for imbalances.

better decisions and unlock innovative ideas.

encouraged to contribute. Inclusion implies an open, empa-

diversity, we need to provide everyone access to the same

In Hitachi, Equity means we treat everyone fairly.

opportunities through structural changes (Equity) and ensure

Treating people fairly is not the same as treating them the

In September 2022, Hitachi established the Hitachi Global

an inclusive and safe environment where everyone feels

same. We recognize that each of us is different, and each ofDiversity, Equity and Inclusion (DEI) Policy. In line with thisaccepted and valued, free to express their thoughts and to

us needs different conditions to thrive. We put in placepolicy, our initiatives to enhance Diversity, Equity and Inclusion

contribute (Inclusion). For this reason, Hitachi is committed topolicies, tools and adaptations to allow everyone to access(DEI) share these basic goals:

implementing a group strategy to drive actions across these

the same opportunities.

• Make Hitachi a truly global company, with talents from all

three main focuses on both global and local levels.

over the world• Enable Hitachi to better serve global customers, improve
our footprint, and open new markets

Hitachi DEI Statement
Diversity, Equity and Inclusion is the Source of Innovation and Growth.
Hitachi has a place for everyone, welcoming differences in colleague backgrounds, age, gender, sexuality, family status,
disability, race, nationality, ethnicity, and religion. We respect and value these and other differences because only throughdifferences can we understand our markets, create better ideas and drive innovation which contributes to society.
At Hitachi we treat everyone fairly, recognizing differences to allow everyone to contribute.
With a diverse workforce, broad experience, and an inclusive culture we will meet customer needs and drive sustainable growth.

• Drive innovation and creativity• Support attraction and retention of talents• Allow employees to feel more engaged and connected, tobe a part of Group strategy, and to actively contributeHitachi Global Diversity, Equity and Inclusion (DEI) Policy

Introduction

SocialManagement

Social Innovation

Global DEI Strategy
Strategy

Human Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social Data

Environmental

SocialGovernance

3. Generation: Colleagues are recognized based on competence, not age

Assurance

Hitachi Sustainability Report 2023

096

Global DEI Management Structure
Structure

In fiscal 2020, we conducted a gap data analysis. In connec-

In line with the above global DEI topics, we set targets for

To achieve our goals, Hitachi created a global and regionaltion with this analysis, we looked at external assessments

BUs, corporate functions, and group companies. The proce-structure to lead DEI initiatives.

and worked with business units (BUs), corporate functions,dure to define the targets included individual meeting where

From a global perspective, we discuss DEI topics both at theand group companies to review status and business strate-

discussions focused on how DEI efforts can help to address

executive level and the implementation level to ensure a common

gies. Based on this analysis, we formulated our global DEI

issues and priorities in each business and regions, sinceand shared understanding and direction in terms of policies andstrategy for the medium to long-term, including:

Hitachi operates in a variety of industries and markets.

initiatives. The mission of the Global DEI Council, including repre-• Moving from standalone initiatives focused mainly on

In addition, based on emerging business and regional

sentatives from each business and region, is to align with thegender equality to a holistic strategy embracing different

priorities, the strategy embedded LGBTQIA+ and Disability

global DEI strategy and discuss implementation in partnership

dimensions of diversity

serve as a core focus of our global activities.

with the HR departments around the world. Material matters are• Integrating DEI into the business strategy as driver for business growth with clear targets• Creating a new global structure to coordinate and guide alldifferent group entities on a clear direction, defining actions

We set actions in place not only to increase minority
representation, but also to implement inclusive behavior andensure equity across the group through the five pillars of
implementation:
Five pillars of implementation

In fiscal 2022, to develop a robust approach to DEI and an

Five Pillars

inclusive culture as core driver for a sustainable business
Leadership
Commitment

leading and championing DEI as part of her sustainability work.
Diversity refers to all the different characteristics that distinguish people one from another. Some of these differences are

Cultureimmediately visible, but many more are intrapersonal—for
instance thinking styles, personality type, and backgroundexperiences. Hitachi commits to tackle all dimensions of diver-

Recruitmentsity; however, we identified topics that are common in every
region and business.

Our Global DEI Topics

Retention

1. Gender: More women across the business, especiallywithin leadership roles
2. Culture: A team which reflects the global nature of our

Regional DEI leaders and teams based in six regions
initiatives aligned to local needs and business strategies.

plans to support DEI development based on specific priorities

Sustainability Officer to address the wider sustainability agenda,

and are reported to the Board of Directors when necessary.
(America, EMEA, India, China, Southeast Asia, Japan) drive• Introducing initiatives to foster an inclusive culture
growth, Lorena Dellagiovanna was appointed Hitachi’s Chiefreported to and deliberated in the Senior Executive Committee,

Advancement

The global DEI division supports the implementation of the
Detailsgroup initiatives, implementing the DEI strategy to foster an• Show President & CEO and other senior leaderships’

inclusive culture and ensure equitable procedures and poli-clear commitment to the DEI vision as driver for business growth• Set leaders as accountable for DEI progress, embracing and promoting inclusive leadership style• Build an inclusive mindset and work environment to allow

cies. The division implements a thorough set of DEI performance indicators.
To foster communication among all functions, BUs andgroup companies, the global DEI division facilitates working

everyone to be/feel safe to be themselves, to contributeand enable innovationgroup sessions. These sessions involve all key internal stake-• Attract and hire diverse people, scouting from different
markets and sectors• Conduct diagnostic analysis and review recruiting
channels and practice, monitoring the recruiting funnel

practices, identify common issues, and find practical solutions.

• Provide different benefits and support robust Employee
Resource Groups (ERGs), driving culturally relevant
programming• Identify diverse talents based on competency• Support diverse leaders and build a solid pool ofdiverse talents

holders, and participants discuss specific DEI topics, share best

Global DEI Management Structure
Board of Directors

Senior Executive Committee

Sustainability Promotion Meetingcompany
Global DEI Council

Introduction

SocialDiversity, Equity and Inclusion
Executive Summary

Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social Data

Environmental

SocialGovernanceFostering Inclusive Leadership
GRI 405-1

Materiality

Activities

Training

Assurance

Hitachi Sustainability Report 2023

097

Initiatives to Support Our Global DEI Topics
Activities

GRI 405-1/405-2

We set greater management diversity as a global DEI target.

To foster inclusive leadership, in fiscal 2023, 84 Hitachi top

The Hitachi businesses pursue a range of ongoing initiatives

Our KPI is the ratio of executive and corporate positions held

executives on a global level have been invited to take part in anfrom the perspective of diversity, equity and inclusion. Theseby women and non-Japanese persons.

inclusive leadership program. Through an assessment, a feed-

initiatives champion the global topics and enable Hitachi toback session, and interactive workshop, Hitachi leaders hadmeet our global DEI Policy.

As of June 2023, 11.4% of executive and corporate offi-	Diversity, Equity and Inclusion
Human Rights

Social Innovation

Global DEI Targets
Targets

Human CapitalManagementcers were women and 20.3% of executive and corporate

the chance to reflect on their behavior, thinking process andofficers were non-Japanese persons. By fiscal 2030, ouraligning to inclusive leadership style that will support to drive

target is for 30% of our executive and corporate officers to bebusiness with diverse employees in complex business

Improving gender equity and inclusion means empowering

women and 30% to be non-Japanese persons.

environment.

women across our organization to access opportunities to

Ratio of Female and Non-Japanese Executive and Corporate
Officers (Hitachi, Ltd.)(Persons)(%)
20

40.0

16

15

13
10
5
0

5
7.1

6
8.6

June 2020

7

8
11.6

10.1

9

17.6

20.3

30.0 30.0
30.0
20.0

9

10.0

12.2

11.4

June 2022

June 2023

0

June 2021

End of FY
2030 (Target)

Number of female executive and corporate officers (left scale)
Number of non-Japanese executive and corporate officers (left scale)
Ratio of female executive and corporate officers (right scale)
Ratio of non-Japanese executive and corporate officers (right scale)In addition, since fiscal 2021, DEI has been also included

Global DEI Topic 1: Genderfulfil their potential based on their will and competences,in training sessions targeting mid-management and future

ensuring an inclusive environment and equitable processes.

leaders such as GAP-L, GAP-K, Hitachi Group Executive

Starting with giving broader access to all roles throughDevelopment Course and Hitachi Discovery Program.

recruitment, we offer women opportunities to progress into

P.072 Global Human Capital Management

leadership positions, providing them support to ensure a
workplace where women can thrive. Our goal is that all

We also created toolkits (among them, Inclusive Language

women at Hitachi feel that they have a place, have a clear

and Inclusive Meeting Guidelines) to identify concrete actions

and distinctive voice, and enjoy the freedom to contribute tothat everyone can take to create and inclusive environment

our innovation.

where everyone feels safe, welcomed and able to contribute.

To encourage all employees to play an active role in thisTo measure progress in inclusion, we included DEI in theprocess, and recognizing that men are the majority group,

Global Performance Management (GPM) to define compe-

we set specific activities to engage men in the conversation,tency as well as in Hitachi Insights, an annual survey to track

explaining why support of gender inclusion is important,

DEI index scores.

what men gain from gender inclusion, and how everyone can

P.076 Improving Employee Engagement

contribute to ensure an inclusive environment.

Introduction

SocialHuman Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social DataManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

098

Initiative on a Group Level

Initiatives of Hitachi Energy(Persons)(%)

To foster an understanding of gender inclusion, why it is import-

In Hitachi Energy, we identify accelerating the advancement of

10,00015.0

ant for everyone and how everyone can contribute, Hitachi inwomen as one of the pillars of Diversity 360, our diversity vision.

12.0

partnership with Catalyst MARC (Men Advocating for a RealWe commit to increase the ratio of women in our global work-

9.0

Change), a global NPO, has set a series of activities in 2023.

force from 19% to 25% and aim at 25% women in management

6.0• Held a webinar open to all employees on a global leveland 40% women in early career hires by 2025, an increase

where we invited a speaker to explain why men should

supported by Female Acceleration efforts across tiers. Since

support gender inclusion and how they can be part of it.

2022, the Diversity 360 Council has been chaired by the CEO• Held a workshop for managers, aiming for them to gain

and his direct leadership team (Executive Team) who takes a

Ratio and Number of Female Managers (Hitachi Group)

8,000
6,000
4,000

8.3
3,975

8.9
4,302

9.5

9.8

4,641

4,762

13.0
8,461

2,000

3.0

0

0

2018

2019

2020

2021

2022 (FY)

Number of Female Managers (left scale)
Ratio (right scale)Note: Based the number of employees as of the end of March (includes employees
seconded from Hitachi to other companies and employees on leave; excludes
employees seconded to Hitachi from other companies). Approximately
20,000 manufacturing workers not registered in the employee database andapproximately 8,000 employees of some newly consolidated companies are
not included. Also, does not include subsidiaries with unregistered employees
at certain grades (positions). The increase in the number and percentage offemale managers over time reflects improved coverage of our human capital
databases and changes in the number of consolidated companies.

increased awareness of men’s role as advocates of inclu-

keen interest in the governance of well-defined KPIs and prog-

sion and gender equity, explore what actions individuals

ress. A significant milestone in this respect is mapping Diversity

across genders can take to foster effective gender inclusion

360 KPIs to the Annual Incentive Plan, positioned alongside ourand build skills to communicate more courageously andLicense to Operate and the section has 15% weightage.

inclusively across gender and other forms of difference.

The company also implements a Talent Development• Launched an e-learning course accessible to all Hitachi

Program which includes mentoring for middle managers. To

employees, setting the basis for unpacking root causes anddate, 59 women leaders have graduated this program. Hitachi

addressing systemic barriers to inclusion and equity by andEnergy incorporates DEI into all policies related to thefor people of all genders—helping them to create personal

employee life cycle, such as equal pay, flexible working, andconnections to the work and its outcomes.

ERGs globally and locally. Among several structural changes
implemented to build an equitable and inclusive environment:• HEERA Gender Equity Council (a strategic council set up by

Gender Pay Gap

Initiatives of Hitachi, Ltd.

We determine employee compensation based on each

In Hitachi, Ltd., we support women in thinking about their own

the company with cross BU-function representation fromindividual’s role and achievements, with no divisions or

career paths. A series of seminars is aimed at women with threeacross geographies who are senior leaders): 11 nationalities

differences based on gender or age.

to four years of experience at Hitachi, Ltd. and Group companies

from 10 countries with a gender split of 11 women and 4 men• Female Talent Development Plan (a holistic framework

At Hitachi, Ltd., the gender pay gap (pay per

in Japan and gives them the opportunity to better understandwomen as a percentage of pay per men) in fiscal 2022

their career and consider their future. The seminars includes

curated to strengthen pipeline of women in leadership): A

was 66.4%. There is no gender-based differences in thelectures on the environment surrounding working women, panel

total of 59 graduates from 4 cohorts with 51% of the grad-

employee compensation system. The difference in per

discussions by women in senior roles, and discussions amonguates been promoted (37%) or has had a lateral career

capita wages for men and women is mainly due toparticipants. The seminars were held twice in fiscal 2022. In addi-

move (14 %) in comparison with the time of appointment

higher proportion of male at higher employee grades,

tion, Hitachi, Ltd. and several group companies in Japan offerto this program.

including management positions, and higher proportion

opportunities for women employees to find role models throughof female who work shorter hours. We will analyze notmentoring programs across businesses and the companies.

only the categories based on the Act on the Promotionof Women’s Active Engagement in Professional Life, butalso more detailed categories.

• More than 10 ERGs focused on Gender Inclusion acrossgeographies at local and region levels.

• Policies & Benefits are gender neutral, with periodic reviewsfor existing support (childcare support, elder care options,employee assistance centers, extended parental leave),equal pay analysis in the planning phase.

Introduction

SocialHuman Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social DataManagement

Social Innovation

Initiatives of Hitachi Vantara

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

099

compliance training, launched a reverse mentorship program,

In Hitachi Vantara, we are committed to providing opportuni-

Initiatives for LGBTQIA+

delivered a transition handbook and updated our HR systems toties for the advancement of women in the technology sector

Since April 2020, many Hitachi Group companies inallow optional reporting of pronouns and gender identity.

and providing career development opportunities for existing

Japan have treated an employee’s same-sex partner as

employees and future candidates.

a family member. As a result, employees with same-sex

Initiatives of Hitachi Solutions

As part of our ongoing commitment to gender diversity andpartners are eligible for the same benefits as those withFor four consecutive years, Hitachi Solutions in Japan

increasing our representation to 30% female by 2025, we are:opposite-­sex partners, such as family nursing leave andreceived the PRIDE Index Gold recognition, the first Japanese• Launching a pilot leadership program to raise the voices ofchildcare and work-life balance support.

evaluation index for workplace initiatives related to LGBTQ+

high-potential women through a transformational TED

In June 2023, Hitachi set a worldwide campaign toestablished in 2016. Hitachi Solutions initiatives include form-

increase awareness on LGBTQIA+ topics, share practicaling a community of allies to participate in workshops andexamples of inclusion and foster allyship. For the firstevents and establishing a same-sex partner policy, whichto leverage their unique opportunity to be advocates fortime, the Hitachi logo reflected the colors of the progress

allows an employee’s same-sex partner to be treated thechange and raise awareness of bias and how to tackle it.

flag to express our support for the LGBTQIA+ commu-

same way as a spouse and receive the same benefits.

• Co-creating an allyship program with external experts led

nity. Among the activities, we organized in-­person and(Technology Entertainment Design)-style speaking course.

• Running workshops and e-learning to inspire and equip men

by our Women of Hitachi ERG, with input from our Rainbow

online events, inviting external speakers, ERGs members

Initiatives of GlobalLogic

Connection (LGBTQIA+) ERG to include an intersectionaland executives to share their experiences and engage-

In 2022, GlobalLogic expanded the Women Influencers

lens on gender.

ment with the topics. We created a LGBTQIA+ guide-

Program, an exclusive women’s development program nurturing

book to increase awareness about the community,

our next senior leaders. The Women Influencers Program pre-leaders/members through a mix of internal discussion andpromote inclusive behavior, and share with managers

pares high-performing women in senior management for more

externally facilitated training.

and HR colleagues best practices to ensure structural

strategic roles and responsibilities within the organization. Thisequity and inclusion.

program equips women leaders with the relevant learning tools,• Providing career development opportunities to our ERG• Investing in programming for girls studying STEAM partner-

mentoring, and coaching to fast-track their career development.

ing with an external company.

The first cohort produced 60% role elevations and more
In 2022, Hitachi Vantara scored a 100 on the Human Rights

than 40% role enhancements and increased the participation ofCampaign’s Corporate Equality Index, a national benchmark-women in the decision-making layers. Two additional cohorts

ing tool on corporate policies, practices, and benefits for thegraduated in 2022, and there are plans to establish the Women

LGBTQ+ community. This score was a result of the change to

Influencers as a permanent leadership development program,supplier selection, where Hitachi Vantara partners with diverse

producing our next generations of women leaders.

suppliers with minority, women, LGBTQ+ or person-with-­disability owners. In April 2023 the company signed the

Global DEI Topic 2: Culture

Human Rights Campaign Business Statement to show weBeing culturally diverse is about creating a team which reflects

stand against anti-LGBTQ+ legislation.

the global nature of our company. Hitachi has grown into a

Established in 2021, the Rainbow Connection ERG contin-

global innovation business from Japanese roots, and ourues working to create a safe environment for LGBTQIA+ employ-

aspiration is to see the global and diverse nature of our busi-

ees and support the engagement and actions on a global andness portfolio reflected in our people—particularly at theregional level identifying regional leaders and allies. We also havedecision-­making levels—supported by an inclusive culture.

LGBTQIA+ healthcare concierge services and DEI global
Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

By providing the opportunity for more individuals from

Introduction

SocialHuman Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social DataManagement

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

100

different nationalities to progress into leadership, we create

Initiatives of Hitachi Energy

Initiatives of Hitachi, Ltd.

opportunities for Hitachi to access new markets and sustain

Hitachi Energy leverages the Collaborative Learning Framework

Hitachi, Ltd. and Hitachi Group companies in Japan recruit

our global growth.

(Mentoring + Coaching + Collaborative Learning Circle) topeople with disabilities via online recruiting fairs and by part-For example, we are involved in group-wide initiatives thatbridge the generational gap. Two specific tools under thenering with special subsidiaries. As of June 2023, the employ-include Global talent management and Future Leaders devel-

Global Mentoring Framework are Reverse Mentoring andment ratio of people with disabilities was 2.48% at Hitachi,

opment to improve diversity and equal opportunity among

Leadership Mentoring.

Ltd. and 2.55% for the entire Group in Japan. These figures

employees from various cultural backgrounds, as well as
eliminate discrimination.
On a leadership level, Hitachi started a Global Leadershipexceed Japan’s legally required employment ratio of 2.3 %.

Initiatives of Hitachi High-Tech
To support our talents, in Hitachi High-Tech America we set an

Development program in 2012 to identify global talents andEmployee Mentorship Program (EMPower). This program aligns

future leaders from an inclusive perspective.

with the company’s goal to develop individuals within the organi-

From a structural perspective, in 2022 we launched a pilot
project of Global mobility cross business in Europe.

zation with the skills and knowledge to achieve personal andprofessional growth. The diverse professional mentor-mentee
relationships ensure a closer collaboration and engagement, andInitiatives of Hitachi Vantara

allow the company to provide a better service to the customers,

To celebrate diversity in the workplace, in Hitachi Vantara we

ensure client satisfaction, and strengthen long-term relationships.

leverage spotlight months, such as Black History and Hispanic

BERG, our black and African American ERG. The company

Approach

Activities

GRI 405-1

training courses to strengthen an understanding of culturesnity launched at the World Economic Forum to implement thearound the world.

inclusion of people with disabilities by providing businessleadership and other opportunities. By joining this worldwide

colleagues is essential in Hitachi’s approach to innovation. We
seek to attract young people to our workplaces and ensure they
contribute to our thinking, while also being sure to foster positive
collaboration and dialogue among different generations. We
recognize the value that all individuals can bring, and so we strive
to recognize colleagues based on competence, rather than age.

3,500

movement, Hitachi seeks to accelerate the inclusion of people
with disabilities internally and externally.

2.37

2.33

3,000

2.43

2.48

2,575

2,767

2,650

2,403

2,000

2.4
2.3

2.26

2,500

2.2
2.1

1,899

2.0

1,500

1.9

981
1.85

1.8
0

2000

Hitachi Group joined The Valuable 500, a global CEO commu-

Technology and society change quickly, and the voice of younger

2.5

Legally required employment ratio*20

Vantara leadership teams continue to participate in intercultural

Global DEI Topic 3: Generation

4,000

500

Expanding Employment of People
with Disabilities

also shares religious and holiday observance messages globally to show respect for cultural diversity. In addition, Hitachi(Persons)(%)

1,000

Heritage month, to invite employees to share stories of theirheritage and culture. We have also recently launched The

Employment of People with Disabilities and Employment
Ratio (Hitachi, Ltd.)*1

2019

2020

2021

2022

2023 (FY)

Employment of people with disabilities (left scale)
Employment ratio (right scale)Note: D ata compiled on June 1 of each fiscal year. The employment ratio is
calculated according to methods prescribed in the relevant laws.
*1 Includes special subsidiaries and related Group companies. (One special
subsidiary and 21 related Group companies in June 2023. Figures include
Hitachi, Ltd.)*2 The legally required employment rate was 1.8% through fiscal 2012, increased
to 2.0% between fiscal 2013 and fiscal 2017, rose to 2.2% in fiscal 2018, androse again to 2.3% in fiscal 2021.

Introduction

SocialHuman Capital

Diversity, Equity and Inclusion
Executive Summary	Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social DataManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

101

To increase the understanding of the gap to be filled in toInitiatives of GlobalLogic

Initiatives of GlobalLogic

ensure equal opportunity for employees with disabilities in

Since 2016, GlobalLogic has significantly invested in creating

GlobalLogic initiated the Regional Accelerator Network to

the company, Hitachi took part in the Generation Valuable

as diverse a workforce as possible. In India, where more thanscale its DEI ambitions. Each of the four regions createdprogram launched in December 2023 by The Valuable 500,

50 percent of its employees are, the company has imple-

on-the-ground teams to operationalize the company’s DEI

which involve an employee with disability and executives in a

mented structural changes in outreach, recruitment, training,goals of Elevate Diversity, Embrace Equity, and Enrichdirect dialogue.

and workplace accommodations to augment its non-tradi-

Inclusion. Under the guidance of the DEI Executive Council,

tional workforce. Their workforce of people with disabilities

these cross-functional teams facilitate local activities tailored

People with Disabilities, an e-learning course introducing

has grown fivefold over the last seven years. It has earned theto each region’s unique needs. One of the key priorities fornon-discriminative policies and accommodations designed

recognition of Emerging Employer by ASSOCHAM andthis fiscal year is fostering the creation of GlobalLogic’s firstfor people with disabilities. Approximately 168,000 employ-

Sarthak NAAI (National Abilympic Association of India) for

official Employee Resource Groups.

ees have attended the course across Group companies in

empowering the lives of persons with disabilities.

Hitachi, Ltd. also implemented Working Together with

Initiatives of Hitachi High-Tech

Japan (Approximately 95% attendance rate).
In addition, Hitachi You and I, a special subsidiary,­created the Recruitment Retention Support Division. The
division supports the long term employment of people withdisabilities and seeks to create a work environment where
employees enjoy high job satisfaction.

Hitachi High-Tech hosts the Hitachi High-Tech WAY, a series

Efforts to implement an understanding of DEI
Trainingof inclusive gatherings consisting of 25 town hall meetings per
year involving a total of 4,000 people. These meetings provide
an opportunity for all employees to speak up about any work

Hitachi Group is working on initiatives to enhance employee

or nonwork matters in an environment with guaranteed psy-

understanding of DEI.

chological safety.

Initiatives of Hitachi Energy

The business recognizes the links between DEI and innova-

Hitachi Energy ensures disability inclusion in the HR pro-

Initiatives of Hitachi Railtion and works to address Workstyle Improvement, Diversity &cesses and policies within the Group. This approach includes

In 2022, Hitachi Rail launched “building an inclusive culture”

Inclusion Acceleration, People Development, Women at Hitachi,

equal employment opportunity policies, induction programs

digital journey open to all employees offering e-learning andand Employee Mentorship at a global level.

for onboarding, and buddy programs as part of retention andwebinars on unconscious bias, cultural awareness, inclusive

support. The business is also making its website more acces-

behaviour, psychological safety and disability inclusion. Digital

sible, and will continue to improve the application process forcontent continues to be added, to support employees in theirpeople with disabilities.

learning. While workshops have also been piloted to deepen
understanding further.

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

102

Human Rights

Human Capital
Diversity, Equity and Inclusion

Human Rights
	Executive Summary

Basic Concept
Hitachi believes that respect for human rights is our responsibility as a global company and essential to our business activities. We emphasize engagement with stakeholders to understandand respond to human rights impacts effectively. We are making continuous efforts not to engage in any acts that may impair individual dignity or discriminate on the basis of sex, sexual orientation, age, nationality, race, ethnicity, ideology, belief, religion, social status, family origin, disease, or disability.

Respect for Human Rights Throughout the
Value Chain
Responsible Procurement

Topic

Overview

Quality and Customer Satisfaction
Social Contribution Activities
Social Data

The Hitachi Group Human Rights Policy is one of our highest internal standards. We conduct
Respect for
Human Rights
Throughout the
Value Chainhuman rights due diligence (HRDD) throughout the value chain based on the Human Rights Risk
Management Implementation Manual, which we produced in accordance with the UN Guiding
Principles on Business and Human Rights. We hold HRDD Execution Managers Meetings once or
twice a year as occasions for group-wide information sharing and deliberation, addressing humanrights risk management as an entire Hitachi Group effort.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Targets, KPIs, and Results

Conduct human rights due diligence andstrengthen monitoring of procurement partners forresponsible procurement, including human rights
FY2023 Target: Conduct human rights risk assessments at all
Bus (10 Bus) and major Hitachi Group companies
FY2022 Results: Conducted human rights risk assessments for certain Group companies

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion

Human Rights
Executive Summary

	Respect for Human Rights Throughout
the Value Chain
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities
Social DataManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

103

Respect for Human Rights Throughout the Value Chain
Respecting the Human Rights of All People

To formulate this policy, we invited representatives of theEuropean Commission, ILO, NGOs, corporations, and lawyers

Approach

specialized in human rights issues to take part in stakeholder

Hitachi believes that respecting human rights is our duty as a

dialogues. We then incorporated opinions and suggestions

global company and essential to conducting business.

offered during the dialogues and formulated the policy following

We refuse to engage in any acts that may impair individual
dignity or discriminate on bases such as gender, sexual orienta-

deliberation and approval by the Senior Executive Committee.
Hitachi has been a member of the United Nations Globaltion, age, nationality, race, ethnicity, ideology, belief, religion,

Compact since 2009. We declared our support for the UN

social status, family origin, disease, or disability.

Global Compact, which outlines a set of universal principles

We place great importance on engagement with stake­that companies should adhere to in the four areas of human

holders in order to understand and manage our impact onrights, labor, the environment, and anti-corruption.

human rights. Stakeholders whose human rights are affected

Accordingly, we continue to pursue efforts in each area.

or may be affected by Hitachi’s operations include employees*3 Guiding Principles on Business and Human Rights; John Ruggie, Special
Representative of the Secretary-General on the issue of human rights andtransnational corporations and other business enterprises; March 2011.

Hitachi Group Human Rights Policy

Hitachi Group Code of Ethics and Business Conduct
https://www.hitachi.com/corporate/about/conduct/pdf/conduct_e.pdf
Hitachi Group Sustainable Procurement Guidelines
https://www.hitachi.com/procurement/csr/EN_HG_SPG.pdf
P.106 Encouraging Procurement Partners to Conduct Activities

Hitachi Global Compliance Hotline

Hitachi also protects freedom of expression and the rightGRI 2-26/406-1

Systemat Hitachi and its procurement partners, local communities,

to privacy, as recognized by international norms, such as theconsumers, other individuals or groups whose livelihoods orInternational Covenants on Human Rights, to ensure no viola-

Hitachi established a Group-wide internal reporting system

working environments may be affected, industry associations,tions of human rights. Hitachi conducts human rights due

called the Hitachi Global Compliance Hotline.

government entities, investors, NGOs/NPOs, and human rights

diligence (HRDD)*2 in line with the UN Guiding Principles on

We investigate all reports, including those concerningorganizations, etc.

Business and Human Rights,*3 and provides appropriate

human rights and harassment, and following verification of theeducation to employees. Furthermore, we comply with therelevant facts, we inform those who submitted reports of thelaws and regulations in the regions and countries where we

investigation results. We make every effort to deal with situa-

operate. Where there is a conflict between internationallytions as appropriate, including taking remedial action whenrecognized human rights and the laws and regulations of anecessary. (Over 20 languages supported)

Hitachi Group Human Rights Policy
PolicyGRI 2-23

Hitachi formulated the Hitachi Group Human Rights Policy inspecific country or region, Hitachi will follow processes thatMay 2013, and we view this policy as one of our highest

seek ways to honor international human rights principles.

internal standards. This policy declares our respect for humanWith respect to the human rights of children, we are striv-

rights as recorded in the International Bill of Human Rights*1

ing to ensure there is no child labor nor forced labor in ourand the International Labour Organization (ILO) Declaration oncompany or supply chain. The Hitachi Group Code of Ethics

Fundamental Principles and Rights at Work. The policy stipu-

and Business Conduct stipulates that consideration be given

lates basic rights at work, including freedom of association

to human rights, including those of children.

and the effective recognition of the right to collective bargaining, the elimination of all forms of forced or compulsory labor,
the effective abolition of child labor, the elimination of discrimination in respect of employment and occupation, and safeand healthy environment.

*1 International Bill of Human Rights: Collective name for the Universal Declarationof Human Rights and International Covenants on Human Rights adopted by theUnited Nations.
*2 Human rights due diligence (HRDD): An ongoing process to identify and assess
potential and actual human rights negative impacts, take appropriate action toprevent or mitigate potential impacts, track the effectiveness of actions toaddress impacts, and communicate externally.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Hitachi Global Compliance Hotline
https://secure.ethicspoint.eu/domain/media/en/gui/109107/index.html
P.145 Hitachi Global Compliance Hotline (Whistleblower System)

Structure for Promoting Respect for
Human Rights
Structure

GRI 2-13/2-24/2-25/3-3

Hitachi continues to strengthen human rights risk management
worldwide through efforts that include tasking the Chief
Sustainability Officer with Group-wide human rights promotion
and the formulation of policies based on the status of HRDD

Introduction

SocialHuman CapitalManagement

Social Innovation

SocialEnvironmental

Governanceexecution managers are then appointed to take charge ofBoard of Directors as necessary. The Audit Committee, com-Secretariat, established within the headquarters of Hitachi, Ltd.,HRDD execution in the respective BUs and Group companies,

posed of independent directors, conducts operational audits(consisting of the human capital division, procurement division

convening HRDD Promotion Meetings. We take measures toon sustainability-related operations, while the responsible
executive officer reports on important human rights issues.

and sustainability division) takes charge of core promotion

Diversity, Equity and Inclusion

activities based on inter-divisional cooperation that include

tion framework, aiming to address global human rights risks.

Human Rights

investigating HRDD promotion measures for the Hitachi Group

Subsidiaries of BUs and key Group companies outside Japanand its procurement partners, preparing implementation-­work closely with regional headquarters to share region-­oriented manuals and guidelines, and responding to inquiries

specific issues (cultural and religious backgrounds, legislativefrom Business Units (BUs) and Group companies.

trends, etc.) and discuss how to respond.

	Respect for Human Rights Throughout
the Value Chain104

progress throughout the Hitachi Group. Our HRDD Promotion

advance the formulation and maintenance of an implementa-

Executive Summary

Hitachi Sustainability Report 2023

Assurance

HRDD Initiatives
Activities

Materiality

Hitachi manages human rights risks according to the follow-

Hitachi comprises diverse business entities and must

In addition, we hold the HRDD Execution Managers

manage human rights risks by taking into consideration the

Meeting once or twice a year as an occasion for Group-wide

Management Implementation Manual prepared for practical

Quality and Customer Satisfaction

characteristics of each business and its value chain. To

information sharing and deliberation. Important matters dis-

use for each BU and Group company, and in line with the UN

Social Contribution Activities

achieve this, Hitachi appoints the heads of BUs and presidents

cussed by the meeting may also be deliberated and decided

Guiding Principles on Business and Human Rights.

Social Dataof key Group companies as HRDD promotion officers. HRDD

on by the Senior Executive Committee and reported to theing HRDD process, based on the Human Rights Risk

HRDD Process

Framework for Promoting Respect for Human Rights
Board of Directors

Senior Executive Committee❹ Communicate

Sustainability Promotion Meeting
HRDD Execution
Managers Meeting

iness ProcessBuswith Stakeho
ge
lde
a
ng

rs

E

Responsible Procurement

Hitachi Group Human
Rights Due Diligence
Process

Information sharing/opinion gathering

Human rights promotion meetings andorganizations at BUs/major Group companies(HRDD Promotion Meeting, etc.)➊ Assess Risks❸ Track➋ Integrate and Act

Human rights promotion meetings andorganizations in each region

Roles of Human Rights-Related Meeting Body and Organization
Meeting body/Organization

Members

Purpose/Role❶ Assess Risks

HRDD Execution Managers Meeting

HRDD execution managers at BUs and key
Group companies• Providing information from experts• Sharing of the status of each company’s initiatives• Requests for surveys/status checks

Human rights meetings andorganizations at BUs/major groupcompanies

Persons responsible for HRDD promotion,
persons responsible for HRDD implementation,and persons in relevant divisions• Pursue human rights activities tailored to the businesscharacteristics of each BU/key Group company

HRDD in fiscal 2022 for each BU and major Group company,

Persons in charge of HRDD promotion atregional headquarters, regional/local representatives selected from BUs/major Group
companies• Conduct and support understanding of HRDD based on the
UN Guiding Principles on Business and Human Rights• Share regional regulatory trends and risk information• Consider measures to address human rights issues in major
projects based on regional characteristics

businesses, value chains, and operating regions.

Human rights meetings andorganizations in each region

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Based on the experience of addressing salient risks (forcedlabor, potential violations of migrant workers’ rights) acrossthe Group in fiscal 2021, Hitachi began business-­specifictaking into consideration the characteristics of respective
Based on the results of the risk assessments conductedat each BU and major Group company for fiscal 2022, we
identified salient human rights risks such as those included in
the following table.

Introduction

SocialManagement

Social Innovation

SocialEnvironmental

Governance105

We plan to implement specific measures in fiscal 2023 andStakeholders Potentially Affected
Procurement partners

Diversity, Equity and Inclusion

Forced labor●

Human Rights

Long working hours●

Executive Summary

Hitachi Sustainability Report 2023

❷ Integrate and Act and ❸ Track

Salient Human Rights Risks

Human Capital

Assurance

Own employees

Customers/end-users

Local communities

beyond for the salient human rights risks identified throughthe risk assessments conducted in fiscal 2022. We will continue to seek guidance from experts and evaluate the effectiveness of measures implemented.

Low wages●

	Respect for Human Rights Throughout
the Value Chain

Child labor●

Responsible Procurement

Harassment●●

Quality and Customer Satisfaction

Occupational health and safety●●

Social Contribution Activities

Violation of migrant worker rights●●

Social Data

Human rights issues in high-riskareas (conflict areas)●●

Activities in 2022
Based on the results of the Survey of forced labor andviolations of the rights of migrant workers that wereidentified as priority risks in fiscal 2021, Hitachi implemented measures during fiscal 2021 at most opera●●

tional sites. We also conducted additional surveys infiscal 2022, confirming that measures at certain sites
had not yet been addressed. We will utilize our Groupwide experience in addressing forced labor and migrant
worker rights violations as priority issues to update

Activities in 2022

Guidance Sessions

In fiscal 2022, Hitachi focused on human

No. ofsessionsrights risk assessment in the HRDD process.
With guidance from external experts at Shift, asessions for BUs and major Group compa-

Identify targets for detailed risk
assessment

2

Identify and prioritize potential
risks in identified areas

Prioritize based on risk identification, severity, and likelihood of
occurrence3

Consider countermeasures forhigh priority, salient risks

Formulate action plan proposals

4

Reflect on the risk assessment
process

Learn and share insights andissuesattended these guidance sessions to deepen
understanding of the human rights risk

Agenda at Each BU and
Major Group Company

Identify areas where humanrights risks are likely to exist

nies. A total of 163 participants from 5 BUs,
11 Group companies, and R&D divisions

Agenda1human rights NPO based in the United States,
we conducted a total of four HRDD guidance

guidelines, which includes examples of problems we

assessment process.

identified and effective measures. We will continue to
use the guidelines to assess the actual situation andformulate measures at each BU and Group company.

❹ Communicate
We disclose information on initiatives concerning respect forhuman rights, including HRDD, through our Sustainability
Report, websites, and other means. We also strive to deepen
an understanding of Hitachi initiatives through appropriate
communication in response to questions, observations, andthe like from investors, ESG evaluation organizations, NGOs,
and media outlets. In addition, we incorporate opinions fromboth inside and outside our organization when considering
future measures.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Introduction

SocialHuman CapitalManagement

Social Innovation

Environmental

SocialGovernanceEngage Stakeholders

secondary and other procurement partners, and how to

Hitachi participated in the Business and Human Rights

respond to human rights-related laws and regulations. We will

Academy: Human Rights Due Diligence Training for Japaneseconsider improving our human rights efforts based on the

Companies organized by the United Nations Development

feedback we received.

Assurance

Hitachi Sustainability Report 2023

106

Encouraging Procurement Partners to
Conduct Activities
Activities

GRI 408-1/409-1

Diversity, Equity and Inclusion

Programme (UNDP) in fiscal 2022. We gained a better under-

Human Rights

standing of this issue through presentations by experts from

Roadmap for the Future

supply chain, Hitachi includes the Hitachi Group Human

Japan and outside Japan regarding how Japanese compa-

By the end of fiscal 2023, Hitachi plans to complete human

Rights Policy in the Hitachi Group Sustainable Procurementnies and business partners should respond to human rights

rights risk assessments across all BUs (10 BUs) and major

Guidelines for our procurement partners. We encourage anrisks. During individual guidance sessions, the UNDP, over-Group companies in areas identified as high-risk. At the sameunderstanding of the Hitachi policy to strengthen respect forseas business and human rights advisory firms, and lawyers

time, we will implement HRDD processes at all BUs and major

human rights and strive to ensure that our approach is put

provided suggestions on improving our human rights policy,

Group companies by the end of fiscal 2024 that include inte-

into practice. Moreover, the guidelines make it clear that childQuality and Customer Satisfaction

how to implement HRDD for companies working across a

grating and acting on countermeasures, tracking the effective-

labor and forced labor must be eliminated. We ensure toSocial Contribution Activities

wide range of business areas, developing HRDD forness of countermeasures, and communicating outcomes.

raise awareness for human rights and engagement with pro-

Executive Summary

	Respect for Human Rights Throughout
the Value Chain
Responsible Procurement

To deepen respect for human rights throughout our entire

curement partners in our supply chain by efforts including

Social Data

Sustainability Procurement Seminars in various regions.

Implementation Status of Recent Major HRDD

In fiscal 2022, we utilized EcoVadis*1, a third-party evaluInitiatives

FY2020Established the HRDD Promotion Secretariat. Prepared and deployed a survey concerning priority risks common to the Hitachi Group(forced labor and violations of the rights of migrant workers) within the Group with the support of the NGO The Global Alliance for
Sustainable Supply Chain (ASSC). Created our Human Rights Risk Management Implementation Manual. This manual incorporated Shift’s
advice on consistency with the UN Guiding Principles on Business and Human Rights and explanations of each step in HRDD.
Implemented improvement measures for grievance mechanisms, including the integration with the Hitachi Global Compliance Hotline.

FY2021

Implemented countermeasures (provided corrective guidance, held workshops, published countermeasure consideration guide, etc.) at each
BU and Group company based on the fiscal 2020 survey to address Group common priority risks.

FY2022BUs and major Group companies conducted HRDD, and we held a total of four guidance sessions with Shift to assess human rights risks.

Initiatives to Prevent Child Labor and Forced Labor
Activities

To prevent child labor, Hitachi reviews official documents tomethods to inform employees that, in accordance with the UN

confirm that the age of an employee does not constitute child

Guiding Principles on Business and Human Rights, compa-

labor when he or she is hired.

nies have a responsibility to respect the rights of their workers

Our Business and Human Rights e-learning course andother awareness-raising materials offer case studies and otheras well as those of their procurement partners with respect tochild labor and forced labor.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

ation platform, to assess and monitor our sustainability performance relating to human rights, including efforts toaddress forced labor and child labor. This assessment
involved gathering written survey to understand the actual
situation on the ground. We also conducted sustainability
audits, including labor and human rights, in reference toresponses to our written survey. We explained to our procurement partners the issues identified during the audits andrequested that they make improvements.
*1 EcoVadis: A sustainability assessment service platform that evaluates companies in the four areas of the environment, labor and human rights, ethics, andsustainable procurement.

P.110 Sustainable Procurement

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Human Rights Education and Raising Awareness Among Employees and Executive Officers
Training

Human Capital

Assurance

Hitachi Sustainability Report 2023

107

Initiatives to Promote Broad-Based Black
Economic Empowerment (B-BBEE) in
South Africa

In accordance with the Hitachi Group Human Rights Policy,of April 2023. In addition, we conduct various awareness

Diversity, Equity and Inclusion

Hitachi familiarizes Hitachi Group executives and all employ-

initiatives that include onboarding training directed at new

Human Rights

ees with human rights through a human rights message on

hires, training by job positions, and training for employees

As Hitachi conducts business in South Africa, we pursue

the importance of respect for human rights from the President

transferred abroad. In this way and others, we strive to convey

activities aligned with the country’s Broad-Based Black& CEO on Human Rights Day, human rights e-learning, andto each employee the significance of respecting human rights

Economic Empowerment (B-BBEE)*1 policy to create employ-other efforts.

in their own work.

ment and economic development. As of November 2022,

Executive Summary

	Respect for Human Rights Throughout
the Value Chain

Activities

In Japan, we aim for every employee to attend annual

Regional headquarters for Group companies outsidegroup training, lectures, or video-based educational activities

Japan engage in various HRDD awareness initiatives tailored

Quality and Customer Satisfaction

held at each business site or Group company. We began

to local conditions to facilitate regional coordination and sup-Hitachi Energy South Africa is obliged to meet theSocial Contribution Activities

introducing video-based education for managers and others in

port. Examples include HRDD seminars for HRDD personnel

Employment Equity Act (EEA)*2 targets and plans, which are

Social Data

October 2022, designed to encourage correct understanding

in the region, HRDD awareness surveys for regional head-reviewed every three to five years and which require annualof LGBTQIA+ issues and prevent harassment. Approximately

quarters executives, and dialogues between outside experts

progress reporting. The ultimate aim is to ensure that diver-

9,000 employees having taken the video-based education as

and regional headquarters executives.

sity in the workforce, including gender diversity.

Responsible Procurement

Hitachi Energy in Southern Africa achieved level 1 under
B-BBEE.

The company’s training strategy is aligned with the skills
development targets linked to B-BBEE. The company also
Implementation Status of Activities to Raise Awareness of
Human Rights
TargetHitachi Group
executives andall employees

Executive
officers ofHitachi, Ltd.

Details

Number ofparticipants in FY2022

Distributed a human rights
message by President &CEO on Human Rights
Day (every year)

Approximately 238,000
emails sent to executives and employees

Achievements in Fiscal 2022
Every year, Hitachi, Ltd. provides human rights training
to executive officers. During fiscal 2022 and the first halfof fiscal 2023, approximately 90 participants attended
workshops for executive-level officers (executives andcorporate officers) on the topic of creating inclusive
organizations in which employees from diverse back-E-learning course on
business and humanrights (provided in 15
languages, taken about
once every three years)

Approximately 169,000
people completed thecourseLecture on human rights
by an outside expert(held annually)

Attended by approximately 90 executive
officers and Board
members

grounds have equal opportunities to flourish.

invests in its current employees in line with diversity and equity
to enhance performance and promotability of internal talent.
Every year, Hitachi Energy South Africa hires graduates andtrainees with Historically Disadvantaged South Africans(HDSA) backgrounds. Currently, employees with HDSA backgrounds comprise 34% of management/supervisory positions
at Hitachi Energy South Africa.
*1 B-BBEE: Companies and organizations in South Africa are scored on B-BBEE
approaches and contributions, rated on a scale from level 1 (highest) to level 8(lowest), or as non-compliant.
*2 Employment Equity Act (EEA): A South African law that promotes fairness andequal opportunities in the workplace for all employees.

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

108

Responsible Procurement

Human Capital
Diversity, Equity and Inclusion

Basic Concept

Human Rights

We believe that placing sustainability at the core of our business throughout our value chain will lead to mutual prosperity for procurement partners and the Hitachi Group. To this end, we

Responsible Procurement

pursue sustainable procurement by identifying and mitigating procurement risks associated with the globalization of our business as far in advance as possible. These risks include humanrights violations and greenhouse gas emissions by procurement partners in the supply chain.

	Executive Summary
Responsible Procurement
Quality and Customer Satisfaction

Topic

Social Contribution Activities

Overview

To ensure sustainable procurement, Hitachi engages in procurement activities in accordance with the Hitachi Group Global Procurement Code, which represents

Social Datathe highest level of business standards in our procurement activities and the Hitachi Group Sustainable Procurement Guideline, which is a code of conduct
Responsible
Procurement

toward procurement partners. We pursue the adoption of Hitachi Group sustainable procurement policies among procurement partners by communicating the
Sustainable Procurement Guideline and holding sustainability procurement seminars in each region, conveying our aim for mutual prosperity.
Additionally, to strengthen risk management and engagement with procurement partners, the Hitachi Group evaluates and analyzes the state of sustainability
initiatives by procurement partners, conducting audits as necessary.
We also work with procurement partners to achieve carbon neutrality throughout the value chain.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion
Human Rights

Responsible Procurement
Executive Summary

Responsible Procurement
Quality and Customer Satisfaction

Management

Social Innovation

SocialEnvironmental

Governance

Assurance

Hitachi Sustainability Report 2023

109

Responsible Procurement
Basic Procurement Policy
Approach

PolicyHitachi Group Sustainable Procurement Guidelines

Sustainable Procurement Conference. This conference,https://www.hitachi.com/procurement/csr/EN_HG_SPG.pdf

attended by the heads of the procurement divisions at

GRI 2-6/2-23

Business Units (BUs) and major Group companies addresses
companywide procurement initiatives related to overall sus-

We believe that putting sustainability at the core of our business throughout our value chain will lead to mutual prosperity
for procurement partners and the Hitachi Group. To achieve
this goal, we pursue sustainable procurement, identifying andmitigating procurement risks associated with the globalization

Sustainable Procurement Management
Framework
Structure

GRI 2-13/2-24/3-3

Policytainability, including environment and human rights by developing strategies for sustainable procurement activities and by
sharing best practices across our organization.
In addition, the Value Integration Division reports regularly

Social Contribution Activitiesof business as far ahead as possible. These risks include

Hitachi established the Sustainable Procurement Office withinto the Senior Executive Committee on key procurement strat-

Social Data

human rights violations and greenhouse gas emissions in thethe Value Integration Division (an organization reporting directly

egies and on sustainable procurement activities. Each year,

supply chain.

to the President & CEO). The Sustainable Procurement Office

the division reports on priority procurement measures to theWe established the Hitachi Group Global Procurement

is responsible for procurement activities at our head office, andAudit Committee, which consists of members of the Board of

Code to guide our procurement activities. These standards

it plays a central role in deliberating and deciding various poli-

Directors. These reports include matters identified andrepresent the highest level of business standards with which wecies related to sustainable procurement.

addressed in the previous year, and feedback from the Audit

comply. This code calls on the Hitachi Group and procurement

Policies and initiatives adopted are communicated in detailpartners to give due consideration to human rights, labor prac-throughout the Hitachi Group by means of meetings including

tices, safety, ethics, quality, and security in the supply chain.
We also established the Hitachi Group Sustainable
Procurement Guidelines, which are a code of conduct for

Procurement Management Organizational Structure
Hitachi, Ltd. Headquarters

procurement partners.
The Hitachi Group Sustainable Procurement Guidelines,

Audit Committee

Report/deliberate Hitachi Group
activities policies/strategies/
initiatives/results

BUs/Group Companies

Senior Executive Committee

labor, health and safety, environment, business ethics, management system, product quality and safety, and preventionof personal and confidential information leakage. We also use

Value Integration Division
Sustainable Procurement Officethese guidelines as a communication tool to inform procurement partners about Hitachi Group initiatives and share ourSustainable Procurement Conference

policies and initiatives related to sustainability. We aim to

BU Procurement
Meetings

Regional
Procurement

Category Strategic
ConferenceGroup Procurement
Strategy Meetingdevelop sustainable business and society together with procurement partners by promoting procurement activities thatadhere to this code.
Sustainable Procurement
https://www.hitachi.com/procurement/csr/index.html

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Business Locations andFactories in Japan,
Overseas

Share activities policies/strategies/initiatives ineach BU/Group company

Activity outcome
monitoring

informs procurement partners of our requirements for compliance. Guideline content falls into seven major categories:

Committee is reflected in activities in the following year.

Instruct/communicate
Hitachi Group activities
policies/strategies/
initiatives

Report on activities

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion
Human Rights

Responsible Procurement
Executive Summary

Responsible Procurement
Quality and Customer Satisfaction

Management

Social Innovation

Sustainable Procurement Conference

Environmental

Details

Southeast Asia

In Southeast Asia, we presented an overview of the
Hitachi Group Sustainable Procurement Policy andstrategy, our status regarding EcoVadis*1 adoption,
sustainability audits and energy management to approximately 200 procurement partners.

as to provide practical support. This conference is open
to all procurement division members, including theApproximately 500 people participated in fiscal 2022.

China

In China, we discussed Hitachi Group Sustainable
Procurement Policy and strategy, providing examples ofsustainable activities to approximately 230 procurement
partners.

India

We covered Hitachi Group Sustainable Procurement
Policy and strategy, and results of sustainability audits in
India to approximately 90 procurement partners.

The conference provides an opportunity to develop ahuman rights due diligence process, gain a better

Social Contribution Activities

understanding of the status of Scope 1, 2, andSocial Data

upstream Scope 3 efforts toward carbon neutrality, andActivities

GRI 2-25/308-2/414-2

Working to Strengthen Engagement With
Procurement Partners• Raising Awareness of the Hitachi Group Sustainable
Procurement Guidelines
Hitachi provides sustainable procurement guidelines in four
languages (Japanese, English, Chinese, and Thai) and distrib-

In fiscal 2022, we conducted sustainability assessments of
1,374 procurement partners (in 48 countries) across the
Hitachi Group.
We use the information obtained from these evaluations
to identify companies requiring corrective action, to discussand monitor improvement methods, and to select and conduct sustainability audits.
We will continue to work with more procurement partners
and expand the number of our partners evaluated by
EcoVadis assessment.

• Procurement Website Content Expansion

Hitachi conducts sustainability audits of the manufacturing

Hitachi upgraded its procurement website for external use in fiscal

bases of our global procurement partners on a regular basis.

2022, adding more contents related to sustainable procurement.

We use external evaluation organizations to conduct the

The website provides to external stakeholders including procure-audits. Sustainability audits consist of document reviews,

ment partners, information on sustainable procurement in aemployee interviews, and facility inspections to monitor sus-

detailed, systematic, and straight-forward manner.

tainability initiatives at procurement partners from the per-*1 EcoVadis: A sustainability assessment service platform to evaluate companies
comprehensively across four areas: environment, labor and human rights,
ethics, and sustainable procurement

Procurement Website

spectives of labor and human rights, health and safety, theenvironment, and ethics.
In fiscal 2022, we conducted sustainability audits on
128*2 procurement partners, which we selected based on

https://www.hitachi.com/procurement/index.html

Regional Distribution of Audits in FY2022

utes these guidelines to approximately 30,000 procurement(15 countries, 128 companies in total)

partners. We conduct sustainable procurement information

Procurement Partner Sustainability Assessments

sessions and other means to communicate matters with

With the purpose of strengthening risk management andwhich we expect procurement partners to comply.

engagement with procurement partners, Hitachi evaluates
and analyzes the state of sustainability initiatives among pro-• Regional Sustainability Procurement Seminars

efforts based on a checklist covering four areas: environment,

Sustainability Audits and Monitoring

share the latest internal efforts toward carbon neutrality.

Sustainable Procurement

110

Hitachi Sustainability Report 2023

Assurancelabor and human rights, ethics, and sustainable procurement.

nies’ understanding of sustainable procurement, as wellheads of procurement divisions at all global locations.

GovernanceRegionSince fiscal 2022, the Sustainable Procurement
Conference is held to improve BU and Group compa-

Socialcurement partners through surveys.

Mexico,Thailand,4

Poland,We invite our procurement partners in Southeast Asia, China,

Starting in fiscal 2022, we adopted the EcoVadis third-

and India to the Regional Sustainability Procurement Seminar

party evaluation platform for monitoring and evaluating theUS,to address social issues proactively together with our procure-sustainability performance of our procurement partners. We

Turkey,ment partners. Approximately 520 procurement partners partic-

perform assessments regarding procurement partners who

ipated in the fiscal 2022 seminar. We strive to communicate therepresent a large portion of our procurement and who are

Hitachi Group Sustainable Procurement Policy to each region.

important to our business strategy. We confirm sustainability

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

4

Vietnam,4

Others,13

China,

6

8
8
India,

Brazil,16

Others: Egypt, Columbia, Saudi Arabia, Bulgaria, Indonesia, Korea

1747

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion
Human Rights

Responsible Procurement
Executive Summary

Management

Social Innovation

Environmental

procurement volume and responses to written surveys. For
any matters identified during the audit, we explain the details

Governance

Hitachi Global Compliance Hotline
https://secure.ethicspoint.eu/domain/media/en/gui/109107/index.html
P.145 Hitachi Global Compliance Hotline

to our procurement partners and request improvements.
*1 Internal auditors conduct audits at certain Group companies*2 Including the number of companies audited by Hitachi Energy beginning fiscal
2022

Hitachi Sustainability Report 2023

111

Internal Education and Training for Procurement
Divisions
Hitachi provides training by position to procurement personnel
responsible for sustainable procurement practices.

Internal Training

Specifically, we offer e-learning on sustainable procurement
to encourage a complete understanding of various policies

Training

Examples of Matters Identified

Assurance

in Japan and overseas, raising awareness across divisions

Examples of Matters Identified for Improvement
Category

Socialthat include Sustainable Procurement Guidelines, Green

Hitachi conducts a variety of training and education programs

Procurement Guidelines, and Responsible Mineral Procurementon sustainable procurement globally to further its internal

Policy. Content also covers important sustainability initiatives

understanding of sustainable procurement.

such as carbon neutrality and human rights due diligence.

Responsible Procurement

Labor and humanrightsEmployee overtime hours not properly managed

Quality and Customer Satisfaction

Occupational
health and safety

Emergency exits and emergency lights are notadequately maintained

Environment

Environmental impact assessments not properly
conducted.

Internal Training through Conferences in FY2022

to newly appointed managers. In fiscal 2022, approximately

EthicsEmployees not trained on fair trade

Region2,800 employees completed this course.

Social Contribution Activities
Social Data

We provide the same training on sustainable procurement

For procurement partners whose audit results indicate a highrisk, we consider training to support improvement, online

GlobalAll Locations

Highlighted our efforts to establish a human rights due
diligence process and to become carbon neutral. We
also cover internal initiatives on advanced sustainableprocurement.

ThailandCommunicated best practices on the Hitachi Group’s
long-term environmental goals, solutions for decarbonization, optimal energy procurement in Thailand, etc.

The UnitedStatesExplanation of the Hitachi Group Sustainable
Procurement Policy; sharing and discussions of bestpractices among Hitachi Group companies.

EuropeExchanged information on sustainable procurement
policies and strategies, our efforts toward carbon neutrality, environmentally friendly raw materials, etc.

monitoring of improvements, and in-person follow-up audits.

Procurement Partner Hotline
In order to promote honest and fair dealings with procurement
partners, Hitachi accepts consultations and reports from all
stakeholders, including procurement partners, on all matters
involving potential misconduct, such as violations of laws andregulations and the Hitachi Group Business Ethics and Codesof Conduct. We established the Hitachi Global Compliance

Details

Encouraging Procurement Partners to
Reduce Their Environmental Footprint
Activities

GRI 308-2

To create sustainable societies, Hitachi pursues its own environmental initiatives under the long-term environmental target,
Hitachi Environmental Innovation 2050. This target calls forthe creation of decarbonized societies, resource-efficientsocieties, and societies harmonized with nature.
At the same time, Hitachi businesses cover a broad

Hotline as a help desk, and we publicize the help desk andrange of business domains. Our procurement is supported byprocedures on our website. The hotline is accessible 24/7

many procurement partners from whom we source various

online or via telephone.

products and parts. We maintain our initiatives to reduce
environmental impact through consistent requests to comply

Implementation Status of Sustainability Procurement Activities (FY2022)

Sustainability
Procurement Seminars

Approx.

520

unit: companies

with relevant guidelines.
In particular, we set a target to achieve carbon neutrality

Sustainability Assessments

Sustainability Audits

by fiscal 2050 through our value chain as we pursue our goal

1,374

128

of creating decarbonized societies. To this end, we encourage*1*1 Includes the number of companies audited by Hitachi Energy beginning FY2022
Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

collaboration and cooperation with procurement partners on
initiatives upstream in the value chain.

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion

Management

Social Innovation

Environmental

SocialGovernance

Sharing Our Green Procurement Guidelines andRelated Initiative

we recommend using chemSHERPA*1 CI/AI, a standardized

We distribute the Green Procurement Guidelines that define ourformat for communicating information on chemical sub-basic position on procuring environmentally friendly parts andstances in products throughout the supply chain.

In order to calculate CO2 emission of Scope 3 Category 1,

products as well as our requirements of procurement partners.

Purchased Goods and Services, in the value chain upstream,

Responsible Procurement

we use the spend basis method to cover entire group pro-environmental management and recommend obtaining envi-

curement activities and also reflect the primary data obtainedronmental certificates. They also address environmental con-from procurement partners into the calculation in part. We

servation reducing the impact of products supplied to Hitachi,

ensure that the primary data collection from procurement

such as conserving resources and energy, recycling, manag-

Quality and Customer Satisfaction

partners are through our engagement and utilize a third-party

ing chemical substances in products, and appropriate disclo-

Social Contribution Activities

sustainability evaluation platform, EcoVadis.

sures of related information.

Responsible Procurement

Social Data

112

Efforts Toward Carbon Neutrality in the
Value Chain Upstream• CO2 Emissions Measurement in the Value Chain
Upstream

Human Rights

Executive Summary

Hitachi Sustainability Report 2023

Assurance

The guidelines set out requirements, such as establishing

To address the issue of chemical substances in products,*1 chemSHERPA: Developed by the Japanese Ministry of Economy, Trade andIndustry to facilitate the management of chemical substances in products bycreating a standardized format throughout the supply chain. The c­ hemSHERPA-­CI
standard is applicable to chemical substances contained in chemical products
and chemSHERPA-AI to those contained in molded products.

Green Procurement Guidelines
https://www.hitachi.com/environment/library/pdf/green_en.pdf
Green Procurement Guidelines Annex
https://www.hitachi.com/environment/library/pdf/green_annex_en.pdf

P.027 Environmental Vision
P.027 Hitachi Environmental Innovation 2050

• CO2 Emissions Reduction Efforts Upstream in the
Value Chain
In fiscal 2022, we selected 21 companies as environmental
advanced partners in the context of Scope 3 Category 1,­explained above, in order to promote the CO2 reduction activitiesof our procurement partners. These 21 partners represent com-

Received the Highest Rating for CDP Supplier Engagement
Hitachi, Ltd. was recognized for its efforts to create net-zero societies, including the reduction of CO2 emissions
throughout its supply chain. In March 2023, the CDP, an international NGO working in the environmental sector,
selected the company as a Supplier Engagement Leader, which is their highest rating for supplier engagement.
P.020 External Assessments Related to ESG

panies most proactive in addressing climate change and are also
important to Hitachi’s business activities. These companies represent a cross-section of sizes and are located in multiple countries and regions, covering a wide range of industries, including
raw materials, components, and equipment. We held discussions

Strengthening Global Partnerships
GRI 204-1

Activities

with these environmental advanced partners regarding CO2

With the worldwide expansion of Hitachi’s business, our pro-emissions reductions over a period of several months to establish

curement partners have become increasingly globalized as

an understanding of CO2 reduction measures and calculation

well. We now deal with some 30,000 procurement partners inmethods. Information obtained through these dialogues will beover 60 countries. Accordingly, we appoint procurement offi-

analyzed and used for future CO2 reduction activities.

cers to oversee procurement activities locally in main regions

In addition, all new aluminum ingots (AL≥99.7%, standard(China, other Asian countries, Europe, and the Americas) inblock) procured for domestic use beginning in fiscal 2023 willorder to encourage procurement from locally based partners

be, in principle, manufactured using hydroelectric power gen-in line with the principle of promoting local production for local

eration to contribute to reduced CO2 emissions. In this way,consumption. These officers carry out activities including

we incorporate and give consideration to environmentally

sustainability monitoring, sustainability audits, and sustainable

friendly procurement, including product materials that utilize

procurement seminars for procurement partners in theirrenewable energy, new technologies, and recycled materials.

respective regions to strengthen sustainable procurement.

Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

Ratio of Local Procurement of Materials for
Main Regions (FY2022)

Asia

China

(excluding
China and Japan)

93

85

%

Europe

83

%

%

The
Americas74%Introduction

SocialSocial Innovation

Environmental

SocialGovernance

Response to the Conflict Mineral Issue
PolicyHuman CapitalManagement

Structure

Hitachi Sustainability Report 2023

Assurance

113

requested. We carry out supply chain investigations with the
GRI 2-27

Activities

In fiscal 2013, Hitachi formulated a Conflict Minerals

Hitachi Group’s Policy for Responsible Supply Chain of Minerals

cooperation of the relevant BUs’ and Group companies’
sales, procurement, and Sustainability divisions. In addition,
Hitachi, Ltd. is a member of the Japan Electronics andDiversity, Equity and Inclusion

Procurement Policy, declaring our stance and commitments

Human Rights

regarding conflict minerals. The policy was revised in fiscal

Responsible Procurement

2016 to lay out explicit measures to be implemented to

System and Initiatives

group addresses the issues of conflict minerals with otherensure responsible procurement. Expanding the scope ofSales divisions, business groups, manufacturing sites, pro-members of the association. In June 2022, the working

corporate responsibilities for the procurement of minerals is acurement divisions, and other divisions within individual BUsgroup held an online information session targeted at person-

global trend, Companies are increasingly expected to address

and Group companies work together to respond to investiga-

nel in charge of investigating conflict minerals at companies

Quality and Customer Satisfaction

broader overall risks to human rights beyond the risk of beingtion requests and inquiries relating to conflict minerals. We

and organizations that face common issues related toSocial Contribution Activities

complicit in conflicts, and recognize responsibilities that

also strive to grasp developments in conflict mineral-related

responsible minerals. The working group explained the back-Social Dataextend beyond the countries adjoining the Democraticlaws and regulations in each country and region and what

ground behind responsible minerals to 2,500 people from

Republic of the Congo to a wider area where the risks areglobal society demands of enterprises, and work to share

1,500 companies.

high. In consideration of these developments, we revised thisinformation within the Group.

Information Technology Industries Association (JEITA)’s
Responsible Minerals Trade Working Group. This working

policy to formulate the Hitachi Group’s policy for Responsible

P.017 Industry Leadership and Policy Recommendations

Each BU and Group company investigates its use of

Supply Chain of Minerals in fiscal 2021.

conflict minerals and reports the results to customers when

Implementing Procurement BCP Initiatives
Hitachi’s Conflict Minerals Response Framework

Sustainability
division

Sustainability
relateddivisions

Coordination
Procurement
divisions

Approach

Individual BUs/
Group companies

Headquarters

SupportResponsible Procurement

Headquarters
Individual BUs/
Group companies

Activities

We work to enhance procurement-related business continuity
plans (BCPs) across Group companies worldwide to ensure

Customers

Raising awareness/
information provision• Understand customer
needs

Sales divisions• Grasp national
regulatory trends• Grasp global trends
Information
sharing

SupportExecutive Summary

https://www.hitachi.com/procurement/csr/EN_HG_RSCM.pdf

Information
sharing

Contacts in business groups/manufacturing andsales sites (technical divisions, etc.)
Quality Assurance divisions/Design and R&D divisions*2

Coordination

Raising awareness/
information provision

Sustainable
Procurement
Council• Grasp national
regulatory trends• Grasp global trends• Check specifications• Check for presence of
3TG*1

Procurement divisions
Consultation

Procurement
partners A

Procurement
partners B• Procurement partner
investigation• Raising awareness amongprocurement partners

Procurement
partners C

Supply chain due diligence by individual BUs/Group companies*1 3TG: Collective term for four commonly used conflict minerals: tin, tantalum, tungsten, and gold.
*2 May differ depending on BU or Group company
Note: Hitachi normally refers to suppliers (including vendors or providers) as procurement partners who build business together on an equal footing.

that significant incidents*1 do not disrupt our business orseriously impact the society.
*1 Events such as natural disasters (including major earthquakes) serious enoughto disrupt businessP.153 Procurement BCPs Initiatives

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

114

Quality and Customer Satisfaction

Human Capital
Diversity, Equity and Inclusion

Basic Concept

Human Rights

Hitachi was founded on the founding spirits of Harmony, Sincerity, and Pioneering Spirit. We ensure product quality and safety by adhering to these principles, along with the basics and ethics,

Responsible Procurement

Quality and Customer Satisfaction

and by putting right and wrong before profit and loss. We engage in quality assurance activities through our unique practice of OCHIBO-HIROI, which means “gleaning” in English and involves
analyzing and learning from failure to further develop our technologies.
We also place great importance on communication with customers and strive to reflect their opinions in our management, products, and solutions.

	Executive Summary
Quality and Product Safety Management
Customer Satisfaction

Topic

Overview

Social Contribution Activities

The Hitachi Group Codes of Ethics and Business Conduct states our commitment to quality and safety. We define our basic principles for quality assurance in Quality

Social Data

Assurance Standards, and we communicate these principles to ensure employee awareness.
Quality andProduct Safety
Management

As well as establishing a framework for quality assurance, we are engaging in incident prevention activities that go beyond incident recurrence prevention.
Specifically, we confirm safety across all product development processes and conduct risk assessments from a wide perspective in collaboration with related BUs
and research laboratories.
We also conduct regular external audits of product safety for certified products and other products. In addition, We acquire certification from external certifying organizations and we are committed to effectively apply the findings of third-party evaluations to our improvement activities.
To improve communication with customers, we are strengthening our global account management and foster digital management to manage and monitor marketing

Customer
Satisfaction

information centrally for the entire Hitachi Group. We have established and operate under various guidelines in our advertising activities to comply with laws andregulations, in addition to showing deference to society as a whole. In addition, we established a global support portal on our website to respond to various types of
information received.

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Quality and Customer Satisfaction
Executive Summary

Quality and Product Safety Management

Management

Social Innovation

Quality and Product Safety Management
Approach to Quality Assurance Activities
Approach

Hitachi was founded on the founding spirits of Harmony,
Sincerity, and Pioneering Spirit. We ensure product quality andSocialEnvironmental

Governance

Hitachi Sustainability Report 2023

Assurance

GRI 3-3/417-1

Assurance Group at the headquarters, creating a system forclose information sharing. Furthermore, by giving greater

Global Quality Assurance Framework

authority to the Corporate Quality Assurance Group we

Hitachi strengthens our global quality assurance frame-

strengthened our quality governance.

work as a high-priority initiative. Specifically, we encour-

When a product incident occurs in the Hitachi Group, theage awareness of Hitachi’s basic principles of quality

safety by adhering to these principles, along with Basics andquality assurance division in the Business Unit (BU) or Groupassurance globally, receiving incident reports from

Ethics, and the principle that “right and wrong” is more import-

company with relevant oversight reports the incident to theGroup companies outside Japan. As in Japan, we areant than “profits and losses.” We engage in quality assurance

Corporate Quality Assurance Group. Weekly reports are

establishing international quality assurance reporting

Customer Satisfaction

activities through our unique practice of OCHIBO-HIROI, which

provided to management executives, including the Executive

lines that are independent of the business divisions, asSocial Contribution Activities

means gleaning in English and involves analyzing and learning

Chairman, and the President & CEO at Hitachi, Ltd. In thewell as practicing OCHIBO-HIROI.

Social Data

from failure to develop our technologies further.

event of a serious incident, the quality assurance division in

As stipulated in the Hitachi Group Code of Ethics andthe BU or Group company reports the incident to manage-

Business Conduct, we aim to provide products and services

ment executives, including the Executive Chairman, and thethat meet the needs and requirements of our customers,

President & CEO at Hitachi, Ltd., as promptly as possible.

complying with relevant laws and standards and ensuring

We review these response procedures every six months andquality and safety by setting additional standards of our own

make improvements as necessary.

cate these principles to ensure employee awareness.
The Hitachi Group Code of Ethics and Business Conduct
https://www.hitachi.com/corporate/about/conduct/pdf/conduct_e.pdf

Framework for Quality Assurance
Structure

GRI 2-25

the safety and trust of customers are the top priorities. To
strengthen this structure further, we made quality assurance

Materiality

activities in every process—from planning and development

Board ofDirectors
Audit
Committee

Internal
Auditing Office

to design, manufacturing, testing, delivery, and maintenance.

Executive Chairman,
President & CEO
Vice Presidents

Executive officers(BU heads)/Group
company presidents

lishes quality assurance divisions within business divisions tofacturing divisions, creating a framework for activity in which

Activities

ogy, and human capital aspects of our quality assurance
Quality Assurance Structure

To ensure full control over quality governance, Hitachi estabact independently from product design divisions and manu-

Quality Assurance Activities

Hitachi strengthens organization and management, technol-

where necessary. We define our basic principles for quality
assurance in Quality Assurance Standards, and we communi-

115

Business
divisions

Qualityassurance
divisions in
BUs/Groupcompanies

We engage in incident prevention activities that go beyond
incident recurrence prevention, based on our approach that
Executive
Officer incharge of
Quality
Assurance

prevention is the essence of quality assurance.

Corporate
Quality
AssuranceGroup

To strengthen quality in software and services, areas that

Quality Enhancement Activities Related to Service,
Software, and Security
continue to grow in scale, we have established a Service andSoftware Quality Enhancement Division and share quality
improvement activities and current challenges. At the same

Close
information
sharingtime, we ensure the software development capabilities andexpertise in improving reliability owned in solutions divisions
are incorporated in product divisions, ensuring higher levels

divisions independent from business divisions. We alsoof reliability in increasingly sophisticated and complex soft-strengthened the reporting line to the Corporate Quality

ware. Furthermore, we are improving and incorporating

Introduction

SocialHuman CapitalManagement

Social Innovation

secure development and maintenance processes for our
products and services to respond to the increasing security
risks arising from network connectivity and openness.

SocialEnvironmental

GovernanceInternational Standards Certification for
Our Quality Management System

Technical Law Compliance Activities

Hitachi’s quality management system has acquired certifica-

Hitachi promotes internal awareness of product regulations,tion from external certifying organizations. We are committed

Responsible Procurement

revised statutes, and enforcement dates in each country andto effectively applying the findings of third-party evaluations toregion. We also work to clarify product-specific laws (with

our improvement activities as well.

Quality and Product Safety Management

our product-specific laws map), pursue regulatory compli-Social Datalished by UL Solutions, a safety certification com-

We have also obtained quality management system certifi-

Quality and Reliability Education
Training

Hitachi regularly provides various forms of education andcation for each of our product categories worldwide.

training related to quality and reliability, including the safety ofunder our product compliance management system.

The chart below shows a representative sample.

products and services, depending on the target employees.

Pursued thorough Safety Design and Safety
Monitoring for Products and Services

Management System Certification

ance, and implement continuous process improvements

Customer Satisfaction
Social Contribution Activities

116

pany. (Frequency of external audits: 4 times/year)

Human Rights

Executive Summary

Hitachi Sustainability Report 2023

UL Mark: Indicates compliance with safety standards estab-

Activities

Diversity, Equity and Inclusion

Quality and Customer Satisfaction

Assurance

In addition to implementing e-learning courses on Hitachi’s
Area

Name of standard

When developing products and services, Hitachi makes the­philosophy regarding quality, available at any time for all
Number ofcertified sites

position specific and executive-­oriented training, as well as

safety of customer lives, health, and property the top priority

Overall quality

ISO 9001

in product design. We strive to ensure safety at every step,

Railway business

ISO/TS 22163

13 sites

technical reliability-­related for specialists every year. Each BU

from development and production to sales and maintenance.

Medical devices

ISO 13485

22 sitesalso conducts specialized technical courses regarding manu-

We strive to ensure safety through risk reduction according
to the following order of priority: design (fundamental safety

1,046 sites

employees, we also ­feature quality assurance as a topic for

Note: Survey results as of the end of June 2023

design), protective measures (safeguards), and usage information such as user instruction manuals. Also, we conduct
risk assessments from a wide perspective in collaboration
with related BUs and research laboratories.

External Audits Concerning ProductQuality Assurance
Activities

Hitachi commissions regular external audits of product safety
for certified products and other products.
Relevant logos indicate products that have received certification. We also commission regular external audits following
certification to confirm ongoing quality standards.
S-Mark: Indicates third-party certification for electronics
based on a certification system administered by theSteering Council of Safety Certification for Electricaland Electronic Appliances and Parts of Japan(SCEA). (Frequency of external audits: 1 time/year)

new employee ­education. We also hold various basic andfacturing, quality assurance, and maintenance.

Introduction

SocialManagement

Social Innovation

Response to Product Safety Incidents
Structure

Human CapitalIn the event of an incident, the division responsible acts swiftly

Diversity, Equity and Inclusion

to resolve the problem. We not only investigate the technical

Human Rights

causes, but also thoroughly discuss the process, framework,

Responsible Procurement

and motivating factors leading up to the occurrence, along

Quality and Customer Satisfaction
Executive Summary

Quality and Product Safety Management
Customer Satisfaction

Environmental

In the case of a severe incident, we provide prompt status
agencies in line with legal requirements, and provide relevant

Incident
occurrence

through other communication channels. At the same time, weSocial Data

have a framework in place to ensure that fast and appropriate
action is implemented at all companies across the Group.
If we determine that retroactive action is necessary, we
notify customers via newspaper advertising and websites tocarry out the necessary repair or replacement program.

Assurance

Hitachi Sustainability Report 2023

117

Hitachi Group
Information gathering

ReportTop management

CustomerliaisonCustomers,
Retailers

Emergency
response
authorities

Decision on
seriousness

Investigation of cause

Response
andreporting

ReportQuality
Assurance
Division
Confirmationof status

information disclosure to customers on our website andSocial Contribution Activities

Governance

Response Procedure for Product Incidents

with ways to prevent recurrence, to ensure product safety.
reports to top management, issue reports to government

SocialOn-siteProduct
investigation investigation

Investigationof theextent ofdamageInvestigative
committee on
serious productincidents

Seriousproduct
incident

Consumer
Affairs
Agency, etc.

Product
recallNotification
via web,
media

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion

Management

Customer Satisfaction

Social Innovation

Quality and Customer Satisfaction
Executive Summary
Quality and Product Safety Management

Customer Satisfaction

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

118

GRI 2-25

Initiatives to Improve Communication
With Customers

Human Rights
Responsible Procurement

Environmental

Activities

We leverage this information in digital marketing to planbusiness strategy for growth, conduct customer targeting,raise the sophistication of proposals, and monitor progress inthe sales process.

website to respond to customer inquiries, opinions, requests,
and complaints. We take corrective actions and measures toand marketing divisions at Hitachi, Ltd. listen to customer
solution strategies. These divisions assign an account manager to each customer to help grow the business of the

Activities

Hitachi offers comprehensive global customer support on its

Hitachi values communications with customers. The sales
feedback when developing management, product, andComprehensive Customer Support Online

Advertising Activities
Activities

prevent recurrence in the event of matters that we must
GRI 417-3

address or resolve in connection with information received.
We incorporate customer feedback when forming corrective

Social Contribution Activities

Hitachi Group. These account managers serve as points ofBecause Hitachi believes that advertising activities must show

actions or measures to prevent recurrence. We also conduct

Social Data

customer contact with Group companies, leading initiatives

proper consideration for society as a whole, as well as comply

training courses, including a Web Inquiry Responsivenessfor improving communication with customers while working

with laws and regulations, we established the Advertisement

Improvement Course, to improve our handling of these inqui-

to build closer relationships between customers andGuidelines. To ensure these guidelines are followed strictly atries. Going forward, the Hitachi Group will continue toaccount managers.

all business locations globally, even where languages andstrengthen and improve consultation desks/response mecha-

customs may vary, the guidelines include an Advertisingnisms among Group companies to respond more quickly andStrengthening Global Account Management

Material Checklist. All items on the checklist are confirmed inaccurately to customer feedback.

Hitachi established the Global Marketing & Sales Transforma-

multiple languages when creating advertisements.

tion Division within the Corporate Sales & Marketing Group to

When conducting communications and promotional

Activities to Improve the Satisfaction ofHome Appliance Customer

achieve sustainable global business growth, driven by theactivities on social media channels, we abide by the Hitachiconcepts of Green, Digital, and Innovation. This headquarters

Social Media Policy, which consists of the Communication

works closely with business units (BUs), Group companies,

Guidelines and the Guidelines for Employees, to not only

and regional headquarters as One Hitachi to support theprotect our brand, but also to avoid violating the rights ofdelivery of solutions to key customers and partners.

others. The policy stipulates our rules for social media use

The Customer Satisfaction Division of Home Appliances busi-

and specific promotional methods. To raise awareness of thisness provides services and solutions to improve the quality ofcutes sales strategies to develop new global businesses inpolicy among members of the company, we carry out

life for people of all ages and regions. In Japan, these initiatives

the Green and Digital sectors. The division also assigns

e-learning activities in Japanese, English, and Chinese about

are carried out under the slogan, 360° Happiness: More smiles

global account managers to key customers to enhance

the use of social media and associated risks.

to life for one and all.

As a priority initiative, the division develops and exe-

global sales activities.

Digital Marketing
Hitachi created the One Hitachi CRM to manage HitachiGroup marketing information centrally. We are also consoli-

Activities

We noted no instances of violations of regulations or

The call centers and websites of the Customer Support

voluntary standards related to corporate advertising activities

Center and Repair Contact Center handle about 2.04 million

in fiscal 2022.

customer inquiries, repair requests, and complaints about

About Hitachi’s Social Media Activities
https://www.hitachi.com/utility/socialmedia/index.html

washing machines, refrigerators, and other appliances every
year. We have undertaken a number of initiatives to responddating the role of market analysis for the Hitachi Group on abetter to inquiries and to reflect customer feedback in our

global level.

MONOZUKURI (Manufacturing). These initiatives include

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion

Management

Social Innovation

database about voice of the customers, including consultations, inquiries, and complaints; and enhancing our website’s FAQ section.
We also conduct customer service evaluation surveys at
Based on the answers, we are improving after-sales services
through CS training courses and other programs.

Social Data

97.3

96.5

to the questionnaire, and 92.6% of respondents expressed

92.6

85

75

satisfaction with our customer service.

0

2018

Customer Contact Cases, Call Completion Rate*1
at Customer Support Center (12-Month Average)(%)

100,000

100
82.3

82.0

78.9

62.3

60,00040,00077.1

36,40732,26436,28080

38,47439,0232022(FY)

Customers for whom repair services are provided(approx. 1.0 million cases a year)
Question:
How satisfied were you with the service from the repair
request to completion?
Responses:
Satisfied/Somewhat satisfied/Somewhat dissatisfied/
Dissatisfied (4 levels)
Satisfaction level: Percentage of respondents who answered Satisfied orSomewhat Satisfied

Flow of Customer Service
Customers

0

2020

2021

40

20

2019

2020

60

20,00020182019

Note: Target scope:(Cases per month)

80,000

95.4

94.6

80

In fiscal 2022, more than 27,000 customers responded

Customer Satisfaction
Social Contribution Activities

100

90

Responsible Procurement

Quality and Product Safety Management

(%)

95

approximately 90 service centers in Japan every month.

Executive Summary

Governance

Results of Evaluation Survey for Customer Repair Services (CS)

improving the connection rate of call center; creating a

Human Rights

Quality and Customer Satisfaction

SocialEnvironmental

2021

Electrical Home Appliances, Audio-Visual Products (Left Axis)

2022

0
(FY)

Response

Inquiry

RepairCustomer Support Center

Repair request

Repair Contact Center

Input indatabase

Connection Rate (Right Axis)*1 Call center call completion rate

Feedback on
improvements

Information
on repairservice

Feedback

Individual business division
Qualityassurance
division
Response activity

Designdivision
Flow of information

Manufacturing
division
Information sharing

Assurance

Hitachi Sustainability Report 2023

119

Introduction

SocialManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

Social Contribution Activities

Human Capital
Diversity, Equity and Inclusion

Basic Concept

Human Rights

Under the Hitachi Group Identity, we treat social contribution activities as an important matter that contributes co-creation of social value and environmental value, as well as to the sustainable

Responsible Procurement
Quality and Customer Satisfaction

development of society and business. We believe that it is people themselves who create innovations to solve social issues and bring about social impact and social good. Based on this belief,
we adopted the social contribution statement, Nurturing People, Connecting to the Future.

Social Contribution Activities
Executive Summary

Topic

Overview

Social Contribution Activities

Under our social contribution activities policy, we conduct various activities globally in the threeSocial Data

SocialContribution
Activities

Targets, KPIs, and Results

Participants in Hitachi Young Leaders Initiative

areas of STEAM (science, technology, engineering, arts and mathematics), the environment, andFY2022 Results: 30 people

community contribution.

(Cumulative Total Since 1996: 405 people)

We also introduced a social contribution program (matching funds) in which employees and thesocial contribution activities.

Participants in Hitachi High-Tech Science
Education Support Activities

The Hitachi Global Foundation pursues social contribution activities in three core areas: the promo-

FY2022 Results: 62,487 people

company work together to make donations, with the aim of increasing employee engagement intion of academic research, human development, and the realization of an inclusive society.

(Cumulative Total Since 1990: 367,362 people)

120

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion
Human Rights

Management

Social Innovation

Social Contribution Activities
Approach to Social Contribution Activities
Approach

Responsible Procurement

Hitachi regards social contribution as an important activity

Quality and Customer Satisfactionthat contributes to the sustainable development of both soci-Social Contribution Activities
Executive Summary

Social Contribution Activities
Social Data

ety and business, and actively promotes social contribution

SocialEnvironmental

Governance

Assurance

Hitachi Sustainability Report 2023

121

GRI 2-24/201-1/203-1/413-1

Breakdown of Funding for Social Contribution Activities in
Fiscal 2022

12.9%

52.9%

Other
(including 11.0% fordisaster relief andhumanitarian aid)

STEAM

Total contributions
1,490 million yen*1

4.3%

Environment

matched by the Group in full. This program serves toincrease employee engagement in social contribution activities and embody the Hitachi Group corporate mission, solidifying the Hitachi Group identity further. In fiscal 2022, Hitachi
donated a total of approximately 13 million yen through thematching funds.

activities in regions where it operates. It is people themselves
who creates innovation to solve social issues, bringing about

29.8%

social impact and social good. Based on this belief, we
adopted the social contribution statement, “Nurturing People,
Connecting to the Future,” and we are engaged in various
activities in three areas: STEAM (Science, Technology,
Engineering, Arts, and Mathematics), the environment, andcommunity support. Our activities in these areas also contribute to the Green, Digital, and Innovation growth drivers

Community support*1 Japan: Hitachi, Ltd., 86 Group companies (87 companies total), and the Hitachi
Global Foundation.
Outside Japan: 183 companies.
Funding includes monetary and in-kind donations, independently organizedprograms, participation or dispatch of employees, community use of facilities,
and employee donations. Funding excludes personnel costs incurred from theparticipation or dispatch of employees.

described in our Mid-term Management Plan 2024. In addition, in the materiality topic identified in fiscal 2022, we set a
KPI related to next-generation talent development and arepromoting activities.
Policy on Social Contribution Activities
https://www.hitachi.com/sustainability/sc/vision/index.html

Funding for Social Contribution Activities
and Number of Participating Employees
Activities

Life Support Leave System
In April 2023, Hitachi, Ltd. introduced Life Support Leave, amulti-purpose paid leave system designed to balance workand family, career development, and social contribution­(volunteer activities outside of work, participation as a donor
for bone marrow or organ donations, etc.) based on different
needs at each life stage. The leave program also encourages
autonomous work styles. Employees can take up to five days
leave per year by using this system.

Support for Employee Social Contribution
Activities
SystemHitachi believes that if each employee views social issues as

Social Contribution Activities
Activities

their own and engages actively in social contribution activities

Hitachi pursues activities centered on the development of

it will lead to the growth of our entire organization. To thishuman capital for the next generation. We work actively toend, we create systems that facilitate employee participation

solve a wide range of issues affecting global and local

in social contribution activities.

­communities. More specifically, we conduct programs that
support the development of next-generation leaders andscience and engineering talents who will be agents ofvided 1,490 million yen in fiscal 2022 toward social contribu-

Social Contribution Scheme Enabling Hitachi and
Employees to Make Donations Together(Matching Funds)

tion activities worldwide, including initiatives to cultivate a

Hitachi offers matching funds as a tool to encourage employ-ment of IT talents is a global challenge, so we focus on

talented younger generation and financial donations andees to participate actively in social contribution activities.

educational activities related to STEAM, which has gained

other support for disaster-struck areas. A total of 23,576

These matching funds are social contribution schemes

attention as a tool for fostering talent development capable

Hitachi Group employees (roughly 7.3% of total employees)

through which donations made by employees in response toof utilizing cutting-edge technologies to enhance creativity,

participated in social contribution activities in fiscal 2022.

disasters, accidents, disease outbreaks, and so on are

expressivity, and problem-solving skills.

The Hitachi Group and the Hitachi Global Foundation pro-change in society. In particular, with the rapid developmentof information technology such as AI and big data, develop-

Introduction

SocialHuman Capital
Diversity, Equity and Inclusion

Area

Environmental

SocialGovernanceSocial Data

Hitachi Sustainability Report 2023

122

date, the organization has offered outreach classes andActivity

BU/Group company

loaned tabletop electron microscopes in 31 countries andregions, pursuing a goal of providing learning opportunities to

STEAM

Hitachi High-TechEnvironment

One Hitachi Earth Month (Encouraging Environmental Volunteer Activities by Employees)
https://www.hitachi.us/about/hitachi/sustainability/turning-ambition-into-action

Hitachi America, Ltd.

Hitachi Young Leaders Initiative (Next-generation leader development program for university andgraduate students in seven Southeast Asian countries and Japan)
http://www.hitachi.com.sg/about/hitachi/activities/hyli/index.html

Hitachi, Ltd.,
Hitachi Asia

porting research activities in more countries and regions.

Contributing to the Development and Tradition of Nebuta Floats While Considering the Environment
https://social-innovation.hitachi/en/article/nebuta/

Hitachi, Ltd.

GlobalLogic Social Contribution Activities in India

Community support

Support for Earthquake Relief Efforts in
Türkiye and Syria
Hitachi donated 20 million yen each to the Japanese Red
Cross Society and the Japan Committee for UNICEF, fora total of 40 million yen. These contributions provide relief
to victims of the earthquake that struck the southeasternpart of the Republic of Türkiye near the border with the
Syrian Arab Republic in February 2023. These are also
used to support reconstruction in the affected areas.
In addition, Hitachi makes donations through the Red
Cross via matching funds (Fiscal 2022 Results: approx. 7
million yen.) Hitachi Energy and Hitachi Vantara also sponsored their own individual donation programs.
Hitachi to Donate to Support Earthquake Relief Efforts in
Türkiye and Syria
https://www.hitachi.com/New/cnews/month/2023/02/230215a.html

50,000 people every year. We seek to cultivate talent who willlead the development of science and medical technology bystimulating interest in science and technology and by sup-Executive Summary

Social Contribution Activities

Assurance

Activities to support online science education with electron microscopes
https://www.hitachi-hightech.com/global/science-edu/

Responsible Procurement

Social Contribution Activities

Social Innovation

Examples of Social Contributions

Human Rights

Quality and Customer Satisfaction

Management

Developing and Empowering
Next-Generation Human Capital
Materiality

Fostering next-generation leaders in Asia throughthe Hitachi Young Leaders Initiative
Hitachi Ltd. and Hitachi Asia have been supporting the
Hitachi Young Leaders Initiative since 1996 with the aim ofdeveloping young leaders who will lead the next generation in
Asia. The four-day program consisting of forums, workshops,
and fieldwork prepared for university and graduate students
from seven ASEAN countries and Japan. Participants discussand exchange opinions on social issues facing ASEAN, andon the final day of the program, they make specific proposals
for solving these social issues. As of the end of July 2022, a
total of 405 program participants are each playing an active
part in various fields such as international organizations,

Providing Donations for Humanitarian Aid to
Ukrainegovernment, companies, and NPOs.

In fiscal 2022, Hitachi, Ltd. donated the equivalent of 8.8
million yen in in-kind goods to Médecins Sans Frontières
Japon to aid people affected by the situation in Ukraine
and those who have fled to neighboring areas.
In addition, Hitachi makes donations to the Red
Cross, UNICEF, and World Central Kitchen via matchingfunds. (Fiscal 2022 Results: approx. 5.4 million yen)Support for Talent Development in Science andEngineering
Aiming to develop the next generation of science and engineering talent, Hitachi provides opportunities for the younger
generation to experience science and technology.
Hitachi High-Tech has supported science education sincethe 1990s, using its own tabletop electron microscopes. To

GlobalLogic believes in being socially responsible, and thecompany’s Grow to Give motto embodies this belief. As
the company succeeds and progress, employees makesure to give back to and support their communities.
One of the key programs under this approach is
Educate to Empower through which the company supports quality education for around 6,000 children acrossIndia. This initiative empowers underprivileged children by
giving them access to quality education, with a special
focus on girls. In fact, the program ensures that at least
50% of participants are girls, creating equal opportunities
for all. STEM Innovation Lab is another GlobalLogicsupported program towards creating an ecosystem that
supports student learning in science by setting up STEM
and robotics lab in government schools. These STEM
labs give girls a chance to discover 21st century skills
and spark their interest in STEM and modern technologies such as Robotics—all while having fun and learning.
Through these initiatives, GlobalLogic ensures everyone gets a fair shot at learning, paving the way for them tobecome the brilliant innovators that will shape the future.

Introduction

SocialHuman CapitalManagement

Social Innovation

Contributing to Society Through the Hitachi
Global Foundation

tribute to the public good centered on three areas: promotion

Human Rightsof academic research, science and technology, human devel-

Responsible Procurement

opment, and realization of an inclusive society. These contri-

Quality and Customer Satisfaction

butions are in line with the intention of Namihei Odaira, theSocial Contribution Activities
Executive Summary

founder of Hitachi, to contribute to society through businessactivities.

Social Contribution Activities
Social Data

Area

The Kurata Grants

Promotion of
AcademicResearch,
Science andTechnology

To promote academic research, science and technology,

The Hitachi Global Foundation
Science and Technology Seminars

Hitachi Sustainability Report 2023

123

The Hitachi Global Foundation Asia
Innovation Award

Related to Infectious Diseases. Third Hitachi Global
Hitachi Future Innovator Program

2022, and the research findings of the award winners
have been shared publicly. In the area of human development, we have continued to conduct the Hitachi Future
Human
Development

Girls in Science Support Project

inclusive society and formed a working group for an

An awareness-raising initiative providing opportunities for the public to learn more about
cutting-edge science technology topics, with the aim of supporting people in discovering
the fascinating fields of science.
[Brain Decoding - Decoding Brain Images with AI Event in Fiscal 2022]
18th The Hitachi Global Foundation Science and Technology Seminarects funded by the Hitachi Fund Support for Research
Foundation Asia Innovation Award was also held in fiscal

Details
A grant program supporting researchers who engage in the pursuit of solutions to social
challenges in the natural sciences and engineering or in philosophical, historical, and etc.
fields through research in the humanities and social sciences.
[Cumulative grants awarded by the end of fiscal 2022: 1,570]

https://www.hitachi-zaidan.org/global/newsletter/data/nl_vol_44.pdf

Hitachi Fund Support for Research
Related to Infectious Diseases

we held an interim report meeting for five research proj-cific activities, we held a forum related to realization of an

Assurance

Activity

Achievements in Fiscal 2022

Innovator Program at elementary schools. In other spe-

Governance

Examples of the Hitachi Global Foundation Activities

The Hitachi Global Foundation conducts activities that con-Diversity, Equity and Inclusion

SocialEnvironmental

electronic journal to be published in fiscal 2023.

An initiative providing awards for achievements in research and development in scienceand technology innovation that help to solve social challenges in the ASEAN region.
[Cumulative awards given as of the end of fiscal 2022: 40]
A research grant initiative aimed at promoting academic investigations, analysis, andconsiderations based on data and evidence for issues that became apparent under
COVID-19. The aim of the grant is to share findings and research results internationally.
[Projects adopted in fiscal 2021: 5]
A program promoting the development of science and engineering human capital targeting Japanese schoolchildren in the upper grades of elementary school. The programaims to cultivate personality traits and abilities required for future human resources inscience and technology.
[Cumulative schools and students participating by the end of fiscal 2022: 18 schools
and 1,410 students]
A program aiming to support science and engineering education for women by showing
the rewards of science and engineering careers to female junior and senior high school
students in Japan.
[Dialogue and Workshops With Female Role Models in Science and Technology Held in
Fiscal 2022]
PIONEER TALK (Japanese only)
https://www.hitachi-zaidan.org/my-tomorrow/dialog/vol8/01.html

Realization of an
Inclusive Society

Realization of an Inclusive Society

A program urging a new understanding among citizens for the purpose of creating
inclusive societies in which people accept various viewpoints and values.
[Online forum, Developing the Power to Thrive for High School Students with
International Backgrounds - The Reality of Education and Questioning the Nature ofSupport - Held in Fiscal 2022] We formed a working group for an electronic journal to be
published in fiscal 2023. This working group studied specifics regarding the academic
fields to be addressed, expected readers, editorial structure, etc.
Developing the Power to Thrive in High School Students From Various International
Backgrounds (Japanese only)
https://www.hitachi-zaidan.org/topics/topics089.html

The Hitachi Global Foundation
https://www.hitachi-zaidan.org/global/index.html

Introduction

Management

SocialSocial Data

Human Capital

Human Capital

Diversity, Equity and Inclusion
Human Rights

Social Innovation

Social Contribution Activities

SocialGovernance124

Hitachi Sustainability Report 2023

Assurance

GRI 2-4/2-7/201-1/401-1/401-3/403-9/403-10/404-1/405-1/405-2/413-1

Employee Data

Responsible Procurement
Quality and Customer Satisfaction

Environmental

Reporting Boundary
Number of employees

Hitachi Group

Total

Unit
People(By region)*

1

Social Data
Human Capital

322,525

Japan

162,083

162,100

158,194

156,768

133,762

China

40,784

41,67351,90350,70743,410ASEAN, India, and the rest of Asia

44,22945,114

61,411

69,876

62,614

20,98522,034

27,122

27,914

22,863

17,074

17,85032,44942,51943,155PeoplePeopleMale
Female(By age)* *15–19 years old
Japan
Outside Japan
20–29 years old
Japan
Outside Japan
30–39 years old
Japan
Outside Japan
40–49 years old
Japan
Outside Japan
50–59 years old
Japan
Outside Japan*1 Regional classifications were changed from fiscal 2020.
*3 Hitachi does not employ 0-14 years old children.

FY2022368,247

Other areas

2 3

FY2021

350,864

Total(By gender)*2

FY2020301,056

EuropeSocial Contribution Activities

FY2019295,941

North America

Responsible Procurement

FY2018People
%
%
%
%
%
%
%
%
%
%

10,786

12,285

19,785

20,463

16,721

239,802244,962

279,659

283,020294,746

196,221

199,603228,278

227,652

230,947

43,58145,35951,381

55,36863,799

0.5

0.5

0.5

0.4

0.5

0.4

0.4

0.4

0.3

0.2

0.1

0.1

0.1

0.1

0.2

15.4

15.7

14.9

15.2

19.0

10.0

9.8

8.6

8.2

6.6

5.4

5.9

6.3

7.0

12.4

27.5

26.8

27.5

27.8

29.5

17.8

16.5

13.9

12.7

9.8

9.7

10.1

13.6

15.1

19.6

30.8

30.4

29.1

28.5

26.2

25.1

23.8

19.4

17.5

13.0

5.7

6.6

9.7

11.0

13.1

24.3

25.1

25.6

25.6

22.6

21.3

21.5

19.6

19.1

15.9

3.0

3.6

6.0

6.5

6.7

*2 Approximately 20,000 manufacturing workers not registered in the employee database and approximately 8,000 employees of some newly consolidated companies are not included.

Introduction

Management

Social Innovation

SocialReporting Boundary
Number of employees(By age)* *Hitachi Group

2 3

60-69 years oldJapan

Human Capital

Outside Japan

Diversity, Equity and Inclusion

Over 70 years old

Human Rights

Japan

Responsible Procurement

Outside Japan

Quality and Customer Satisfaction

Hitachi, Ltd.

Total

Social Contribution Activities(By gender)

Social Data
Human Capital

Environmental

Total(By gender)

Responsible Procurement
Hitachi, Ltd.

Male

Total
(By gender)

Hitachi Group*2

Turnover rate* *Hitachi Group*

FY2022

1.5

1.6

2.4

2.4

2.2

0.6

0.6

0.6

0.6

0.4

0.9

0.9

1.8

1.8

1.8

0.0

0.0

0.1

0.1

0.1

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.1

0.1

0.1

33,49031,442

29,85029,48528,672

27,82825,628

24,10023,74922,939

5,662

5,814

5,750

5,736

5,733

41.3

41.5

41.8

41.7

41.2

41.9

41.9

42.2

42.1

41.7

39.0

39.4

40.1

40.2

39.6

42.1

42.4

43.0

43.3

43.4

42.6

43.0

43.5

43.8

43.9

40.8

41.1

41.2

13.5

12.6

Japan

18.8

18.8

18.9

18.1

18.3

China

8.8

8.4

8.4

9.2

10.2

7.4

7.4

7.2

8.2

7.1

7.1

7.2

6.4

7.5

8.3

Europe

7.6

8.3

6.0

5.7

9.1

Other areas

6.4

7.6

7.5

5.7

6.7

15.8

15.7

14.2

13.8

13.4

11.8

11.8

11.0

10.9

10.1

18.0

17.9

18.3

18.5

18.6

18.5

18.5

18.8

19.0

19.2

15.6

15.6

16.0

16.2

16.3

Male

Years

Years
Years

Male

Total
(By region)*1

FY2021

13.6

Total

2

Age

FY202040.1

Female
4 5Age

FY201915.0

Female(By gender)

PeopleFY2018125

Hitachi Sustainability Report 2023

Assurance

39.5

North America

Hitachi, Ltd.

％

Years

ASEAN, India, and the rest of Asia

(By gender)％

Governance

15.1

Total
(By region)*1

％

Age
Male
FemaleAverage service(years)％Age

FemaleSocial Contribution Activities

Unit

PeopleMale
FemaleHitachi Group*2

Average age

Social

Years
%

Japan
Outside Japan

%

6.3

5.2

4.3

7.5

8.5

2.2

2.5

2.0

3.3

2.6

15.4

10.9

7.4

13.1

13.5

*1 Regional classifications were changed from fiscal 2020. *2 Approximately 20,000 manufacturing workers not registered in the employee database and approximately 8,000 employees of some newly consolidated companies are not included.
*3 Hitachi does not employ 0–14 years old children. *4 The figures are based on enrolled employees with employment contract including those seconded from Hitachi Group to other companies and those taking leave, and excluding those seconded from othercompanies to Hitachi Group (as of March 31). *5 Figures include only voluntary resignations.

Introduction

Management

Social Innovation

SocialReporting Boundary
Turnover rate* *4 5

Hitachi Group*2(By gender)

Hitachi, Ltd.

Diversity, Equity and Inclusion

Total

Social Contribution Activities

Unit

Governance

FY2018%%FY2019126

Hitachi Sustainability Report 2023

Assurance

FY2020

FY2021

FY2022

5.8

4.8

4.1

7.1

7.8

8.4

7.2

5.2

8.9

10.8

1.6

1.7

1.4

1.8

2.0

1.4

1.5

1.3

1.7

1.8

3.0

2.8

2.1

2.3

2.8

*2 Approximately 20,000 manufacturing workers not registered in the employee database and approximately 8,000 employees of some newly consolidated companies are not included.
*4 The figures are based on enrolled employees with employment contract including those seconded from Hitachi Group to other companies and those taking leave, and excluding those seconded from other companies to Hitachi Group (as of March 31).
*5 Figures include only voluntary resignations.

Diversity, Equity and Inclusion

Human Capital
Responsible Procurement

Male
FemaleResponsible Procurement

Social Data

Social

%(By gender)

Human Rights

Social Contribution Activities

Male
FemaleHuman Capital

Quality and Customer Satisfaction

Environmental

Reporting Boundary
Number and ratio of
Hitachi Group*
registered employees*1

2

Total number of registered employees

Hitachi Group*1*2

285,857

291,028

301,320

58,830 (20.2)

67,224 (22.3)

Japan

25,076 (14.9)

26,203 (15.6)

26,106 (16.0)

26,773 (16.5)

24,832 (17.9)

China

6,733 (39.5)

6,856 (37.5)

7,232 (34.1)

7,594 (35.7)

7,869 (35.1)

6,231 (24.6)

6,828 (25.3)

6,990 (20.7)

9,120 (20.6)

15,851 (25.2)

3,176 (26,2)

3,955 (24.9)

4,298 (22.7)

4,954 (25.7)

5,076 (25.1)

Europe2,348 (21.5)

2,361 (21.3)

6,903 (22.0)

6,761 (23.8)

9,705 (23.6)

Other areas

2,016 (22.1)

2,462 (23.4)

3,190 (18.2)

3,628 (23.4)

3,891 (24.6)

Total number of registered employees

Total number of managers

Total number of managers
Number and Ratio of female managers(By rank)

General manager or above
Section manager

Wage Ratio of
Women to Men*1*5

Hitachi, Ltd.

FY202254,719 (19.1)

Number and Ratio of female managers
Hitachi, Ltd.*4

FY2021251,016

Number and Ratio of female employees
Number and Ratio ofmanagers*3

FY202048,665 (19.4)

North America

Hitachi, Ltd.

FY2019242,994

ASEAN, India, and the rest of Asia%

FY201845,580 (18.8)

Number and Ratio of female employees(By region)

Unit

People (%)

People (%)

PeoplePeople (%)
PeoplePeople (%)

Part-time and fixed-term employees

34,99733,19832,71332,086

6,649 (19.0)

6,537 (19.7)

6,595 (20.2)

6,584 (20.5)

47,831

48,336

48,712

48,6903,975 (8.3)

4,302 (8.9)

4,641 (9.5)

4,762 (9.8)

65,171
8,461 (13.0)

People13,332

12,694

11,881

11,584People (%)

635 (4.8)700 (5.5)

768 (6.5)

785 (6.8)

135 (3.4)

147 (3.9)

156 (4.5)

146 (4.3)

160 (5.0)500 (5.3)

553 (6.2)

612 (7.3)

639 (7.8)

666 (8.4)

―

―

―

―

66.4

―

―

―

―

66.7

―

―

―

―

55.3

People (%)

All employees
Permanent and full-time employees

37,4896,678 (17.8)

Female/Male(%)

11,188826 (7.4)*1 The figures are based on enrolled employees with employment contract including those seconded from Hitachi Group to other companies and those taking leave, and excluding those seconded from other companies to Hitachi Group (as of March 31). *2 Approximately
20,000 manufacturing workers not registered in the employee database and approximately 8,000 employees of some newly consolidated companies are not included. *3 The increase in the number and percentage of female managers over time reflects improved
coverage of our human capital databases and changes in the number of consolidated companies. And, does not include subsidiaries with unregistered employees at certain grades (positions). *4 The figures are based on the number of employees including those seconded from Hitachi Group to other companies, those taking leave, and those seconded from other companies to Hitachi Group (as of March 31). Figures for fiscal 2021 exclude those seconded from other companies to Hitachi Group. *5 “All employees” is the sum of“Permanent and full-time employees” and “Part-time or fixed-term employees.” The “Permanent and full-time employees” are permanent employees in full-time positions, while the “Part-time or fixed-term employees” are employees who are either part-time or fixed-term
employees. There are no gender-based differences in the employee compensation system. The difference in per capita wages for men and women is mainly due to higher proportion of men at higher employee grades, including management positions, and higher proportion of women who work shorter hours.

Introduction

Management

Social Innovation

SocialHuman Capital

Reporting Boundary
Number and Ratio of
new employees
hired

Hitachi Group*

2

Social

Unit

Total

People(By region)

Human Rights

Social Contribution Activities

FY2019FY2020

FY2021

FY2022

14,997

17,96329,53932,733

3,943 (26.3)

4,269 (23.8)

6,489 (22.0)

9,593 (29.3)

Japan

1,438 (23.1)

1,372 (23.0)

1,329 (23.9)

2,051 (15.7)

1,275 (25.8)

China

432 (35.6)

400 (30.9)

371 (31.9)

449 (38.3)

377 (29.0)

People (%)

793 (25.3)

1,002 (27.7)

595 (22.2)

1,402 (22.0)

4,314 (30.4)

1,002 (32.8)

635 (29.7)

574 (23.2)

927 (27.9)

1,212 (28.3)

Europe313 (23.8)

147 (22.9)

970 (26.5)

971 (27.9)

1,482 (28.8)

Other areas

596 (27.3)

387 (28.9)

430 (17.8)

689 (27.4)

933 (32.7)

North America

Quality and Customer Satisfaction

FY2018127

Hitachi Sustainability Report 2023

Assurance

17,120ASEAN, India, and the rest of Asia

Responsible Procurement

Governance

4,574 (26.7)

Number and Ratio of new female employees hired

Diversity, Equity and Inclusion

Social Data

Environmental

People (%)*2 Approximately 20,000 manufacturing workers not registered in the employee database and approximately 8,000 employees of some newly consolidated companies are not included.

Human Capital
Responsible Procurement
Reporting Boundary

Social Contribution Activities
Number and Ratio of
female andnon-Japanese
executive andcorporate officers

Unit

Number of female executive andcorporate officers
Ratio of female executive andcorporate officers
Number of non-Japanese executive andcorporate officers

July 2020

June 2021

June 2022

June 2023

People

4

5

7

9

%

5.0

7.1

10.1

12.2

People

7

6

8

13

%

8.8

8.6

11.6

17.6

9
11.4

Hitachi, Ltd.

Ratio of non-Japanese executive andcorporate officers

Reporting Boundary
Number and Ratio of
female andnon-Japanese
Directors

June 2019

Unit

June 2019

July 2020

June 2021

June 2022

16
20.3

June 2023

Total

People

11

13

13

12

12

Male

People

9

11

11

10

10

FemaleHitachi, Ltd.

Japan

Outside Japan

Hitachi, Ltd.

%

81.8

84.6

84.6

83.3

83.3

People

2

2

2

2

2

％

18.2

15.4

15.4

16.7

16.7

People

7

7

7

7

7

％

63.6

53.8

53.8

58.3

58.3

People

4

6

6

5

5

％

36.4

46.2

46.2

41.7

41.7

Introduction

SocialManagement

Social Innovation

Reporting Boundary
Maternity/partner’s leave

Hitachi, Ltd.

Utilization rate*6

Human Capital
Return rate forrecipients*7

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction

Environmental

Childcare leave

Hitachi, Ltd.

Responsible Procurement
Social Contribution Activities
Childcare or partner maternity leave

Hitachi, Ltd.

FY2018FY2019128

Hitachi Sustainability Report 2023

Assurance

FY2020

FY2021

FY2022
43.9

Male

37.8

38.1

33.8

32.9

Female

100.0

100.0

100.0

100.0

100.0
100.0

Male
Female

%

100.0

100.0

100.0

100.0

100.0

100.0

99.7

100.0

98.3

Male

99.7

96.9

97.7

97.5

99.4

Female

100.0

100.0

99.7

98.5

100.0

Utilization rate*9

Male

2.7

4.0

7.3

9.9

18.4

Female

100.0

99.6

99.6

100.0

100.0
100.0

Return rate forrecipients*10

Human Capital

Unit

Governance

Retention rate forrecipients*8

Social Contribution Activities

Social Data

SocialMale
Female

％

94.3

100.0

100.0

100.0

97.4

97.4

98.9

100.0

99.3

94.4

100.0

Retention rate forrecipients*11

Male

90.9

84.8

71.4

Female

99.4

95.5

98.0

96.6

95.9

Utilization rate*12

Male

34.5

37.2

35.4

40.6

56.8

%

*6 Total number of employees who took maternity leave or partner’s maternity leaves/Total number of employees with newborn children*7 Total number of employees not resigning on the day after completing maternity leave or partner’s maternity leaves/Total number of employees who took maternity leave or partner’s maternity leave*8 Total number of employees who did not resign within one year after maternity leave or partner’s maternity leave/Total number of employees who took maternity leave or partner’s maternity leave*9 Total number of employees who took child-care leave/Total number of employees with newborn children*10 Total number of employees returning from child-care leave/Total number of employees who planned to return from child-care leave. Number of employees returning excludes those who planned to return and resigned voluntary without retuning*11 Total number of employees continuously working one year after returning from child-care leave/Total number of employees returning from child-care leave*12 Total number of employees who took childcare leave or partner maternity leave, or the number of employees taking both/Total number of employees with newborn children

Reporting Boundary
Employment of people with disabilities
Employment rate of people with disabilities

Hitachi Group companies in Japan*13

Unit

June 2019

June 2020

June 2021

June 2022

June 2023

People

1,899

2,403

2,575

2,767

2,650

%

2.26

2.33

2.37

2.43

2.48

*13 It includes special subsidiaries and related Group companies. (There were one special subsidiary and 21 related Group companies in June 2023.)

Introduction

SocialHuman CapitalManagement

Social Innovation

Responsible Procurement
Quality and Customer Satisfaction

SocialGovernance129

Hitachi Sustainability Report 2023

Assurance

Employee Engagement
Percentage of positive responses to
employee engagement questions

Hitachi Group

Reporting Boundary

Unit

Global average%(By region)

Diversity, Equity and Inclusion
Human Rights

Environmental

Japan
Outside Japan

FY2018%FY2019FY2020

FY2021

FY2022

60

60

62

65

69.5

ー

ー

ー

56

61.2

ー

ー

ー

80

82.3

Note: Questions change slightly each year. Above figures are not adjusted for changes in questions. In fiscal 2022, the composition of questions measuring employee engagement was revised. The percentage was calculated from the average of thepercentage of positive responses to the following four questions: pride in working for Hitachi; whether it is a great place to work that one would recommend to others; job satisfaction and sense of accomplishment; and desire to continue working for
Hitachi for the foreseeable future.

Social Contribution Activities

Social Data
Human Capital
Responsible Procurement
Social Contribution Activities

Talent Development
Reporting Boundary
Number of participants of management
training programs

Hitachi Group

Training hours per employee

Hitachi Group

Average amount invested in training per
employee*1

Unit

FY2018FY2019FY2020

FY2021

FY2022For management leaders

People

83

90

78

76

87

For managers

People

3,761

3,973

3,481

3,900

4,191

Hours

—

—

—

25.9

29.0

Hitachi Group

Yen

—

—

2

61,700*358,300*62,700*4

Hitachi Group companies in Japan

Yen

127,800*

128,000*

—

—

—

5

6

*1 The scope of data was changed from the Hitachi Group in Japan to the Hitachi Group from fiscal 2020.
*2 Hitachi, Ltd., 44 Group companies in Japan, and 54 Group companies outside Japan, total 99.
*3 Hitachi, Ltd., 44 Group companies in Japan, and 63 Group companies outside Japan, total 108.
*4 Hitachi, Ltd., 37 Group companies in Japan, and 66 Group companies outside Japan, total 104.
*5 Hitachi, Ltd. and 13 major Group companies in Japan*6 Hitachi, Ltd. and 12 major Group companies in Japan

Reporting Boundary
Digital talent headcount*7

Hitachi GroupTotal(By region)

Unit
PeopleJapan
Outside Japan

PeopleFY2018FY2019FY2020

FY2021

FY2022—30,00035,00067,00083,000—19,00023,00029,00042,000—11,00012,00038,00041,000*7 Disclosure initiated in fiscal 2019. We define digital talent as those who possess any of the 12 capabilities required for digital business, including design thinking, data science, and security. The number of digital talents is the total number of persons under eachcapability (total number of people, in thousands).

Introduction

Management

SocialOccupational Health and Safety

Human Capital

Total Recordable Injury
Frequency Rate (TRIFR*1)

Social Innovation

Reporting Boundary
Hitachi Group

Unit

Total
(By region)

Diversity, Equity and Inclusion
Human Rights

Social Data

Hitachi Group

Employees

Hitachi, Ltd.

Employees

Contractors

Contractors

Human Capital

FY2021

FY2022

0.28

0.27

0.26

Japan

—

0.17

0.14

0.12

0.12

0.14

Asia (excluding Japan)

—

0.30

0.17

0.12

0.11

0.09

—

1.66

1.54

1.36

1.20

1.10

—

0.53

0.45

0.38

0.45

0.39

0

5

3

2

2

5

0

4

1

1

1

3

0

0

0

0

0

0

0

1

2

1

1

2

—

Cases

PeopleResponsible Procurement
Social Contribution Activities

CY20210.29

EuropeHitachi Group (including contractors)

CY20200.37

Quality and Customer Satisfaction
Number of deaths

CY2019130

Hitachi Sustainability Report 2023

Assurance—

Responsible Procurement
Number of fatal accidents

Governance

CY2018—

North America, Central
and South America

Social Contribution Activities

SocialEnvironmental

Note: We used the statistical period between January and December of each year in the past. However, in accordance with the safety targets set under our Mid-term Management Plan 2024, we changed the statistical period for total recordable injury frequency rateand injuries/fatal injuries to April through March beginning in fiscal 2021.
*1 TRIFR: Total Recordable Injury Frequency Rate (injuries per 200,000 work hours)

Reporting Boundary
Lost-time accidents

Unit

Hitachi Group
Hitachi Group companies in Japan*2

Cases

Hitachi, Ltd.

CY2018CY2019CY2020CY2021

CY2022

506

396

314

434

419

64

57

52

54

51

6

6

4

3

2
0.02

Occupational accident
severity rate*3

Hitachi Group companies in Japan*2

—

0.11

0.03

0.00

0.00

Occupational accident
frequency rate*3

Hitachi Group companies in Japan*2

—

0.20

0.17

0.17

0.17

Notes: The period for each year is from January to December.
*2 Hitachi Group figures for Japan, including Hitachi, Ltd., are for 188 Group companies in 2018; 169 companies in 2019; 136 companies in 2020; 131 companies in 2021; and 142 companies in 2022.
*3 Occupational accidents are defined as those involving a fatality or work-time loss of one day or more.
*4 For management purposes, the figures for companies that became affiliated companies during 2022 are aggregated for the year from January to December.

0.16*4

Introduction

SocialManagement

Social Innovation

Reporting Boundary
Hitachi Group companies in Japan

Absence rate*5(By health type)

Unit
MentalGovernance

CY2018%

Physical

Human Capital
Diversity, Equity and Inclusion

SocialEnvironmental

Hitachi Sustainability Report 2023

Assurance

CY2019CY2020CY2021131

CY2022

0.64

0.65

0.62

0.66

0.74

0.24

0.25

0.22

0.21

0.24

*5 The percentage of employees taking sick leave for seven or more consecutive days or formally taking leave (number of employees taking sick leave per month/number of employees per month × 100)

Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities

Reporting Boundary
Medical Exam andScreening Attendance
Rates

Hitachi Group companies in Japan(By exam type)

Unit

FY2019FY2020

FY2021

FY2022

General physical exam*

79.3

81.2

81.1

80.6

82.4

53.2

56.3

56.6

57.1

58.4

37.1

38.7

39.1

39.3

40.9

80.6

82.7

82.2

84.7

86.5

Uterine cancer screening*8

Social Data

FY2018

Breast cancer screening*7

6

Stomach cancer screening*9%

Human Capital

Intestinal cancer screening*

81.3

83.5

83.0

85.5

87.3

Responsible Procurement

Lung cancer screening*10

93.2

95.8

96.8

98.0

98.7

30.9

29.8

28.4

27.6

27.0

Social Contribution Activities

9

Smoking Rate*

11

Hitachi Group companies in Japan*6 Men and women aged 35 and over
*7 Women aged 30 and over
*8 Women aged 25 and over
*9 Men and women aged 30 and over
*10 Men and women aged 35 and over
*11 Employees aged 35 and over (results of specific medical examinations)%Introduction

Management

Social Innovation

SocialResponsible Procurement

Human Capital

Sustainable Procurement Activities

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement
Quality and Customer Satisfaction
Social Contribution Activities

Social Data
Human Capital

Responsible Procurement

SocialEnvironmental

Assurance

132

Hitachi Sustainability Report 2023

GRI 2-6/204-1

Reporting BoundaryUnit

FY2018Sustainability monitoring
Sustainability audits

Governance

Hitachi Group

Companies

Sustainability Procurement Seminars

FY2019FY2020

FY2021

FY2022

345

291

271

(Human rights) 2,524*1(Environment) 708*1

24

19

27

25

128*3

126

59

450

359

520

1,374*2*1 Sustainability monitoring in fiscal 2021 was focused on human rights and environmental risk assessment*2 Sustainability monitoring in fiscal 2022 was focused on environment, labor and human rights, sustainable procurement, and ethics.
*3 Including the number of companies audited by Hitachi Energy beginning fiscal 2022

Rate of Local Procurement of Materials for Main Regions

Social Contribution Activities

Reporting BoundaryUnit

FY2018China
Asia (excluding China and Japan)
EuropeHitachi Group%

Americas

FY2019FY2020

FY2021

FY2022*4

88

90

98

95

93

71

71

80

87

85

81

78

77

83

83

66

69

70

83

74

*4 Hitachi Metals and Hitachi Construction Machinery were excluded in FY2022, and Hitachi Energy was included in FY2022.

Green Purchasing
Green purchasing rate*5

Reporting Boundary

Unit

Hitachi Group%FY2018FY201986

FY202084

FY202183

FY202283

81*5 Green purchasing rate: The percentage, by monetary value, of products with the Eco Mark among all products purchased subject to the Act on Promoting Green Procurement.

Conflict Mineral Issue
Number of surveys on conflict minerals
conducted from customer requests

Reporting Boundary

Unit

Hitachi Group*6

Cases

CY2018CY20191,874

CY20201,645

CY2021
1,836

CY2022
2,002—*7

Note: Reported statistics is from January to December every year
*6 Among all Business Units (BUs) and Group companies, there are a total of 20 BUs and Group companies that have a registered CSR manager. Among these 20, the boundary covered some BUs and Group companies that conducted the survey from customer requests.
*7 The data for 2021 are the most recent available, due to the timing of data compilation.

Introduction

Management

Social Innovation

Environmental

SocialSocialSocial Contribution Activities

Human Capital

Funding for Social Contribution Activities and Total Employees Participating

Diversity, Equity and Inclusion
Human Rights
Responsible Procurement

Reporting Boundary
Funding for social
contribution activities

Hitachi Group and
The Hitachi Global Foundation*1

Quality and Customer Satisfaction

Total
By area*2

Million Yen
STEAM
Environment

Social Contribution Activities

Community support

Social Data

Other

Human CapitalMillion Yen(%) Of which, disaster relief
and humanitarian aid

Responsible Procurement

Social Contribution Activities

Unit

Total employees
participating

Hitachi Group and
The Hitachi Global Foundation*1*1 FY2018 Japan: Hitachi, Ltd., 141 Group companies, and The Hitachi Global Foundation. Outside Japan: 152 companies
FY2019 Japan: Hitachi, Ltd., 153 Group companies, and The Hitachi Global Foundation. Outside Japan: 234 companies
FY2020 Japan: Hitachi, Ltd., 119 Group companies, and The Hitachi Global Foundation. Outside Japan: 209 companies
FY2021 Japan: Hitachi, Ltd., 103 Group companies, and The Hitachi Global Foundation. Outside Japan: 252 companies
FY2022 Japan: Hitachi, Ltd., 86 Group companies, and The Hitachi Global Foundation. Outside Japan: 183 companies*2 Area classifications were changed from fiscal 2022.

Participants

Governance

FY2018FY2019133

Hitachi Sustainability Report 2023

Assurance

FY2020

FY2021

FY2022

1,888

1,833

1,910

1,869

1,490

383 (20.3)

278 (15.2)

325 (17.1)

201 (10.8)

193 (12.9)

38 (2.0)51 (2.8)

23 (1.2)

36 (1.9)65 (4.3)

387 (20.5)477 (26.0)

206 (10.8)295 (15.8)

444 (29.8)

1,080 (57.2)

1,027 (56.0)

1,356 (71.0)

1,337 (71.5)

789 (52.9)

130 (6.9)

86 (4.7)

220 (11.5)

143 (7.7)

163 (11.0)

54,62988,13439,98233,58523,576

Introduction

Management

Social Innovation

Environmental

Contents
135

Corporate Governance

142

Business Ethics and Compliance

149

Risk Management

155

Information Security

160

Governance Data

GovernanceSocialGovernance

Assurance

Hitachi Sustainability Report 2023

134

Introduction

GovernanceManagement

Social Innovation

Environmental

GovernanceSocialAssurance

Hitachi Sustainability Report 2023

135

Corporate GovernanceCorporate Governance
Executive Summary
Corporate GovernanceBusiness Ethics and Compliance

Basic Concept
Hitachi views the expansion of long-term and comprehensive benefits for shareholders and investors as an important management goal. We also recognize that positive relationships with thediverse stakeholders of Hitachi and the Hitachi Group form an important part of our corporate value. In this context, we strive to develop systems to maintain good relationships with stakeholders and enhance our corporate value, including measures to encourage constructive dialogue.

Risk Management
Information Security
Governance Data

Topic

Overview

We endeavor to ensure the distinct separation of management oversight and business execution, to establish a system for the agile execution of business, to deterCorporate
Governancemine appropriate compensation and to achieve highly transparent management.
Specifically, we select directors who possess the qualities that make them suitable to lead Hitachi management, including global experience and knowledge across avariety of fields, excellent character, and broad experience and knowledge of business management. We strive to establish a highly transparent and independent
corporate governance structure and to introduce an executive compensation system that is linked to the enhancement of corporate value.

Introduction

GovernanceCorporate GovernanceManagement

Social Innovation

Environmental

GovernanceSocialAssurance

Hitachi Sustainability Report 2023

136

Corporate Governance
Hitachi views the expansion of long-term and overall returns to shareholders and investors as an important management objective. Hitachi, Ltd. and Hitachi Group companies maintain good
relationships with a wide range of stakeholders, and we recognize that these relationships make up an important portion of our overall corporate value. Accordingly, we are striving to establish a

Executive Summary

system that will improve our corporate value primarily through the implementation of measures focused on promoting constructive dialogue. To advance these efforts effectively, we are working toCorporate Governanceimprove our corporate governance by ensuring thorough separation between the oversight and execution of management, establishing a swift business execution system, and striving to achieve

Business Ethics and Compliancehighly transparent management.

Risk Management
Information Security
Governance Data

Hitachi’s Corporate Governance Framework and Features (as of June 2023)
GRI 2-9/2-11/2-12/2-13/2-18/2-19/2-20/2-24

Structure

POINT 1

General meeting of shareholders
Senior Executive Committee
Appointment

ReportAppointment/
oversight

2

President & CEO

Hitachi established the Nominating Committee, the Compensation
Committee and the Audit Committee, with independent directors
comprising the majority of members and serving as chairpersons.
This system ensures transparency in management, separates theoversight and execution of management, facilitates the full exercise of oversight functions, and enables discussions and reports
to be conducted appropriately within these three committees.

Executive Vice Presidents
and Executive Officers/
Senior Vice Presidents andExecutive Officers/
Vice Presidents andExecutive Officers

members
10 non-executive(including two women)

1

1

1

Nominating
Committee

Compensation
Committee

Audit
Committee

4 directors

4 directors

5 directors*

3 AuditInternal
Auditing
Office3 Audit

Executive
Officer
Department
in charge

Executive
Officer
Department
in charge

Department
in charge

3 Audit
3 Audit
3 Report

Independent* One standing Audit Committee member

POINT 2

Independence of the Board of Directors

Increased the number of independent directors, including
non-Japanese directors, in 2012.

3 Report

Non-independent

Transitioned to a company with committees (currently acompany with a nominating committee, etc.) in 2003.

Board of Directors

2 executive members

Transparency in Management

Accounting Auditors

Department
in charge

The Board of Directors, which is chaired by an independent director, has 12 members, including nine independent directors, two
directors who are also serving as executive officers, and one
director who is not serving as an executive officer. The chairmanof the Board is an independent director. In addition, we haveestablished a system that facilitates the full exercise of oversightfunctions by maintaining a separation between management
oversight and execution.

POINT 3

Enhanced Collaboration throughTripartite Auditing

Hitachi’s Audit Committee and internal audit sections collaborate
with third-party accounting auditors to strengthen Tripartite
Auditing aimed at increasing the effectiveness of internal controls.

Introduction

GovernanceManagement

Social Innovation

Environmental

GovernanceSocialAssurance

Hitachi Sustainability Report 2023

Experience, Knowledge and Capabilities Required for Directors
GRI 2-10

ApproachCorporate Governance
Executive Summary

Corporate Governance137

Hitachi Directors need to have a wide range of experience and knowledge in global and diverse fields to be worthy of leading Hitachi’s management to expand the Social Innovation Business globally,and have the qualities of broad experience and expertise in management.
The experience, knowledge, capabilities and other qualities required for Hitachi directors are as follows.

Business Ethics and Compliance
Risk Management
Information Security

Core Skills
Core qualities that ensure management oversight efficiency and decision-making functions

Number ofapplicabledirectors

Professional Skills

Number ofapplicabledirectors

Expertise and experience that enhance discussions pertaining to the promotion of the Social
Innovation BusinessGovernance Data
Corporate
management

Corporate management experience and knowledge

12peopleGovernment andinternationalorganizations

Leadership experience in government, governmental agencies,
international organizations or economic associations that facilitates anunderstanding of and response to regulations and social issues, aswell as practical experience at educational institutions

4
peopleGlobal businessBusiness experience outside Japan or management experience at acompany that develops business globally

12peopleLegal affairs

Expertise and practical experience in legal affairs indispensable for
global business and the development of new business1
personRisk management

Knowledge of risk assessment and management necessary tomaintain operations

12
peopleR&D andintellectual property

Expertise and practical experience in R&D or intellectual property
facilitating the utilization of technology and the incorporation of newtechnologies

2
peopleFinance andaccounting

Knowledge and management experience pertaining to financial
accounting necessary for medium- to long-term corporate value
creation from a financial perspective

12
peopleDigitalPractical experience in industrial fields vital for promoting digitaltransformation (DX) in the Social Innovation Business4
peopleBoard of Directors Composition (as of June 2023)
Structure

GRI 405-1

Activities

Independence(ratio of independent directors)

Diversity(ratio of non-Japanese and female directors)

Diversity(by country of origin)
Germany 1 person
United Kingdom

Independent
directors
Nine people

75%

Non-Japanese
Directors
Five people

1 person

41.7%

2 people

United States

2 female directors(16.7% of overall director total)India

1 personIndustrial fieldJapan

7 people

Finance

RetailEnergy and resources

Materials andchemicals

Transportationand logistics
Machinery
Electricity and gas
IT and services

Electric andprecision instruments

Introduction

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Social Innovation

Environmental

SocialGovernance

Assurance

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138

Highly Experienced Directors
Structure

Activities

Corporate Governance
Executive Summary

Name

Notes

Main industrial fields

Corporate GovernanceBusiness Ethics and Compliance

Katsumi Ihara

Engaged in Sony Group management, possessing a wealth of experience and insight in the field of international corporate
management.

Electric and precision
instruments, financeIndependent director
Nominating Committee chairman
Audit Committee member
Compensation Committee member

Ravi Venkatesan

Possesses a wealth of experience and insight in international corporate management at Microsoft India and other companies,
and in particular, the digital field and business in emerging markets.

IT and services

Independent director

Cynthia Carroll

Possesses a wealth of experience and insight as a manager of large international corporations including Anglo American.

Materials and chemicals,
energy and resources

Independent director
Nominating Committee member

Ikuro Sugawara

Held a leading position in the Ministry of Economy, Trade and Industry, and possesses a wealth of experience and insight in
the administrative field.

General industry

Independent director
Audit Committee member

Joe Harlan

Possesses a wealth of experience and insight in international corporate management, including at the Dow Chemical
Company.

Electricity and gas, energy
and resources, materials
and chemicals

Independent director
Compensation Committee member

Louise Pentland

Attorney licensed in New York and the UK possessing a wealth of insight into corporate legal affairs and corporate governance cultivated through experience as a Legal Officer at PayPal Holdings and other large global corporations.

IT and services, financeand retailIndependent director

Takatoshi Yamamoto

Possesses extensive insight into business and management in the fields of corporate analysis and international corporate
management.

Finance

Independent director
Compensation Committee chairman

Hiroaki Yoshihara

Possesses a high degree of professional knowledge and a wealth of experience in the fields of international corporate management, finance and accounting.

Finance, general industry

Independent director
Nominating Committee member
Audit Committee chairman

Helmuth Ludwig

Mainly engaged in Siemens Group management, possessing a wealth of experience and insight in international corporate
management and the digital field in particular.

Machinery, manufacturing

Independent director
Audit Committee member

Keiji Kojima

Engaged in R&D at Hitachi and its group companies, most recently in the Smart Life sector, possessing a wealth of experience and achievements, particularly in digital businesses related to Lumada global deployment.

IT and services

Director, Representative Executive Officer,
President & CEO
Compensation Committee member

Mitsuaki Nishiyama

Engaged in operations in accounting and financial affairs and management at Hitachi and Group company etc., possessing a
wealth of experience and achievements.

Materials and chemicals

Director
Audit Committee member

Toshiaki Higashihara

Engaged in managing a wide range of fields at Hitachi and its group companies, including the social infrastructure and electric
power system businesses, possessing a wealth of experience and achievements that include promoting the global expansionof Hitachi Group business.

Transportation andlogistics, IT and services,energy and resources

Director, Executive Chairman, Representative
Executive Officer
Nominating Committee member

Risk Management
Information Security

Positions at Hitachi and responsibilities

Governance DataIntroduction

GovernanceCorporate Governance
Executive Summary

Corporate GovernanceBusiness Ethics and Compliance
Risk Management
Information Security
Governance DataManagement

Social Innovation

Administrative Performance of theBoard of Directors
Structure

SocialGovernance

Board of Directors Meetings in FY2022

The Nominating Committee has the authority to determine
proposals submitted to the general meeting of shareholders
for the election and dismissal of directors. The Nominating
Committee consists of four directors, three of whom are independent directors.
This committee determines director candidates, holds
preliminary discussions concerning the appointment anddismissal of the CEO and receives advance reports on theselection and dismissal of executive officers.
In fiscal 2022, the Nominating Committee held meetingson 10 days.

■ Primary Activities
In addition to deciding upon the contents of proposals madeconcerning director appointments at the Annual General
Meeting of Shareholders, the Nominating Committee confirmed receipt of a preliminary report on the executive officer
system implemented in fiscal 2023. In addition, it promoted
committee-related activities, including discussions and individual interviews aimed at developing candidates for future management and leadership positions.

Audit Committee

FY2022 Board of Directors Meeting Results
Meetings held
Nine days
Average number of agenda items
7.6 per meeting
3.1 hours
Average meeting length(longest meeting 5.3 hours)

The Audit Committee has the authority to audit the executionof duties of directors and executive officers and to decide on
proposals submitted to the general meeting of shareholders
for the election and dismissal of accounting auditors. The
Audit Committee currently consists of five directors, including four independent directors and one standing Audit
Committee member.
Hiroaki Yoshihara, the chairman of the Audit Committee,
has been involved in accounting and other business practices
at the KPMG Group for many years and possesses a considerable wealth of knowledge concerning finance and accounting.
In fiscal 2022, the Audit Committee held meetings on
15 days.

Discussion of Major Themes
Discussions/Deliberations

CEO REPORT
Mid-term
Management Plan
Settlementof accounts
Risk management■ Primary Activities

Business strategy

100

200

Hitachi Sustainability Report 2023

139

Activities

Nominating Committee

The Board of Directors approves the basic management policy
for the Hitachi Group and oversees the execution of the duties
of executive officers and directors in order to sustainably
enhance corporate value and shareholders’ common interests.
The basic management policy includes the Mid-term Management Plan and annual budget compilation. The Board of­Directors focuses on strategic issues related to the basic management policy, as well as other items to be resolved that areprovided in laws, regulations, the Articles of Incorporation, andthe Board of Directors Regulations.
In fiscal 2022, CEO Keiji Kojima reported on the progress of
the Mid-term Management Plan 2024, including overall priority
items and progress in each sector, and confirmed consistency
with the plan. In promoting the execution of management strategies, more time is spent discussing and deliberating than isused to explain quarterly financial reports and business strategies. In addition, at the Board meeting, CEO Kojima reports anddiscusses important topics for the executive side that were discussed at the Senior Executive Committee, facilitating a sharedunderstanding with the executive side.

0

Assurance

Activities of the Three Committees

Activities

Explanations

Environmental

300

400

Total annual time (minutes)

The Audit Committee conducted activities that were focusedon its priority matters for consideration, which included thestrengthening of collaboration and the facilitation of information

sharing under a “Tripartite Audit” (audit by the Audit
Committee, internal audit and audit by accounting auditors),
and auditing of the establishment and operation of internal
control systems from the perspective of risk management andvalidity of execution of duties. In addition, a standing committee member worked to obtain information as needed in atimely and accurate manner, mainly by collaborating with theInternal Auditing Office, among other departments, andattending important internal meetings such as the Senior
Executive Committee, and facilitated information sharing withother committee members.

Compensation Committee
The Compensation Committee has the authority to determine
remuneration policies for directors and executive officers andremuneration for individuals (including amounts of remuneration) based on them. Currently composed of four directors,
including three independent directors, the committee strives
to ensure objectivity, transparency, and fairness in the remuneration determination process.
In addition, the Compensation Committee verifies andreviews details of the process used for determining remuneration for individuals, including assessments concerning basic
remuneration amounts, evaluations of progress made toward
individual targets, and performance appraisals that are tied toshort-term incentive compensation.
In fiscal 2022, the Compensation Committee held meetingson 8 days.

■ Primary Activities
The Compensation Committee determined remuneration
amounts for individual directors and executive officers inaccordance with established policies while verifying andreviewing the processes and results of appraisals for performance and individual targets tied to short-term incentive
compensation for executive officers. In addition, the committee reviewed the executive compensation system while giving
due consideration to compensation granted to managers at
global companies and the goal of sharing value with shareholders, and decided upon policies covering remuneration for
directors and executive officers in fiscal 2023.

Introduction

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Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

140

Director and Executive Officer Compensation
SystemCorporate Governance
Executive Summary

Fiscal 2023 Revision of Executive Compensation System

Compensation structure(1) Directors

Corporate Governance

At a meeting of the Compensation Committee, Hitachi discussed the executive compensa-

Compensation for Directors is basic remuneration as fixed pay. The amount of basic remuneration is decided by adjusting ation system to enable continued growth over the next ten years, through a modal change

basic amount to reflect full-time or part-time status, committee membership and position, and travel from place of residence,

toward growth in MMP 2024. A decision was made to amend the executive compensation

etc. A Director concurrently serving as an Executive Officer is not paid compensation as a Director.

system to establish a system that can secure competitive superiority over global companies,(2) Executive Officers

Business Ethics and Compliance
Risk Management
Information Security

ensure effective Pay-for-Performance that rewards contributions to growth and innovation,

Governance Dataand increase corporate value by strengthening sustainable management. For specific details,

medium- and long-term incentive compensation as variable pay. The basic amount of Basic compensation, short-term incen-

please see the following page.

tive compensation and medium- and long-term incentive compensation is set based on the ratio of compensation for theCompensation for Executive Officers consists of Basic compensation as fixed pay and short-term incentive compensation andWith regard to employee compensation as well, Hitachi has introduced a framework in

President & CEO, which in the past was 1:1:1, but has been changed to 1:1.2:2, increasing the ratio of variable pay with awhich individual targets are linked to the company’s targets, and compensation is determinedfocus on LTI, which takes the form of stock compensation, and the compensation ratios for other executives have also been

according to the achievement of those targets. The management targets put forward in MMP

set based on this ratio. This takes into account the composition of executive compensation for major global companies includ-2024 are applied as evaluation indexes when deciding compensation for individual employ-ing European and the United States companies, in order to increase corporate value through the growth of global businesses.

ees. Hitachi will cultivate a growth mindset among both executives and employees and strive

If it is found that an executive officer has engaged in misconduct during their term of office, any compensation alreadypaid shall be returned to the company (clawback provision).

to achieve global growth as One Hitachi.

Please refer to Compensation to Directors and Executive Officers in the Annual Securities Report (The 154th Business Term)
Annual Securities Report (The 154th Business Term) P108 Compensation to Directors and Executive Officers
https://www.hitachi.com/IR-e/library/stock/hit_sr_fy2022_4_en.pdf

Basic Policy of the New Executive Compensation System
Key Principles: New Incentive Plan

Aiming for growth, profitability,
and cash generation

Accelerate sustainable
management

Emphasize alignment
with shareholder value

Ensure global competitivenessin business and compensation

1 Alignment with the Mid-term Management Plan 2024●

Aligned with mid or long-term growth ofcorporate value and business performance●

Corp. value growth throughPay-for-Performance

Linkage with the+
Mid-term
Management Plan 2024

Mid- or long-term
growth beyond
the mid-term plan

Attract and retain key talentTransparency, objectivity and fairness• In the Short-term incentive compensation and Medium- and long-term incentive compensation, set performance metrics toward the Mid-term Management Plan as Key
Performance Indicator (“KPI”) to encourage executives to achieve them.
2 Establishment of compensation program and corporate performance program that foster a growth mindset• Pursue an optimal balance between short and medium- to long-term performance about “growth,” “improving profitability” and “cash generation,” aiming for improvement ofshort-term performance and medium- to long-term growth in corporate value.
• Establish a compensation program that significantly rewards performance by setting stretched goals and commensurate compensation levels.
3 Setting indicators to promote sustainable management• Develop specific indicators and goals related to “Environments,” “Business with Integrity” and “Quality of life” under its sustainability strategy, and encourage their implementation.
4 Expansion of stock compensation that rewards growth in corporate value over the medium to long term
• Expand stock compensation to better align with medium- to long-term corporate value.
5 Competitive compensation levels with a global perspective• Ensure competitive compensation levels to attract and retain key executives in the global market, regardless of their residence or origin, who lead global management of a
global organization.
6 Compensation benchmarking with objectivity and transparency• Reference the benchmarks in the US and European markets in addition to the benchmarks in the Japanese market for analysis and level-setting from multiple perspectives.
7 Transparency and objectivity through enhanced compensation disclosure and shareholder engagement• Endeavor to gain investors’ understanding and support through sufficient disclosure of the compensation program with a global perspective and ongoing shareholder
engagement, and continuously improve the program based on the insights gained through the engagement.

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Social Innovation

Environmental

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Hitachi Sustainability Report 2023

Assurance

Compensation to Executive Officers (Fiscal 2023)
SystemActivities

Corporate Governance

Before amendment

After amendment

Base compensation: short-term incentive:
medium- and long-term incentive = 1:1:1 ratio

Base compensation: short-term incentive:
medium- and long-term incentive = 1:1.2:2 * ratio

Executive Summary

Corporate GovernanceBusiness Ethics and Compliance
Risk Management

Fixed pay

Variable pay

Fixed pay

Information Security
Basic compensation

Governance Data

Short-term incentive
compensation

Medium- and long-term
incentive compensation

Variable pay

1

2

3

Basic compensation

Short-term incentive
compensation

Medium- andlong-term incentive compensation* For President & CEO

Basic compensation

1

Set according to the relevant position by adjusting that amount to reflect financial results and individual performance.

Short-term incentive compensation

2

3

Medium- and long-term incentive compensation

Short-term incentives (STI)

Medium- and long-term incentives (LTI)
Individual
evaluation:
10%

Company-wide performance:
70%

President
Executive officers
in charge ofcorporate affairs

Company-wide performance:
40%

Executive officers
in charge ofbusiness

Company-wide
performance: 30%

1• Revenues• Lumada business• Adj. EBITA Margin revenues• EPS• Core FCF

Individual evaluation:
40%

Divisional performance:
30%

Individual
evaluation: 20%

Sustainability:
20%

3

Sustainability:
20%

3

Sustainability:
20%

3

1

3

• Revenues•L umada business• Adj. EBITA Margin revenues• Core FCF• Materiality—“Environment,”“Business with Integrity” and“Quality of Life” —based on thesustainability strategy

Compensation withincumbency condition:
30%

Compensation with stock price condition:
70%

When the Midterm Management
Plan targets areachieved
Max. +20%

2

1

TSR growth rate
TOPIX comparison

Global competitive
comparison

2

ROIC
+10%

Sustainability:+10%

Points of amendment
1 Strengthening the link with the Mid-term Management
Plan 2024• Adopt the key indicators set forth in the Mid-term­Management Plan 2024 adopted as KPIs (STI)• Introduce incentives for achieving the Mid-term Management
Plan (LTI)

2 Strengthening the link with Corporate Value
Enhancement• Increase the stock price condition compensation ratio (LTI)• Establish a global competitive comparison (LTI)

3 Further evolving of Sustainable Management• Separate sustainability evaluations and set at 20% (STI)• Create new evaluations regarding our Materiality—­“Environment,” “Business with Integrity” and “Quality ofLife”—based on the sustainability strategy (STI)Introduction

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Social Innovation

Environmental

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142

Business Ethics and ComplianceCorporate GovernanceBusiness Ethics and Compliance
Executive Summary
Business Ethics and Compliance
Risk Management

Basic Concept
With the globalization of the economy, overarching regulations and differences in governmental and economic frameworks, the importance of building a culture based on ethics, honesty andintegrity are key. Hitachi believes that business ethics and compliance are the foundation of our Company, and we engage in fair, transparent, and honest management. We are committed tocreating an open environment in which employees perform at their best and in which every employee feels safe in acting ethically. In this way, we work together to create environments where
everyone is empowered to speak up and to perform at the highest standards.

Information Security
Governance Data
Topic

Overview

Targets, KPIs, and Results

The Hitachi Group Code of Ethics and Business Conduct spell out decision-making procedures andBusiness
Ethics andComplianceactions for all Hitachi Group executives and employees. To promote compliance, the Hitachi Group
Chief Compliance Officer (CCO) leads the One Hitachi Compliance Program, a program for global

Assessment Score on Ethical Culture and Ethics
FY2023 Target: Standard score of 60 points or higher

compliance initiatives. Specifically, we conduct training to foster a culture of corporate ethics and(out of 100)

compliance, pursuing risk assessment within the company and among business partners. We are

Achieved a score of 76.5

also expanding the Hitachi Global Compliance Hotline (grievance mechanism) globally.
Anti-Bribery
andAnti-Corruption

Hitachi has made it clear that we will not tolerate any bribery, kickbacks, or other corrupt behavior by employees or business partners, or any conduct that violates

Tax
Compliance

To respond to tax risks associated with the globalization of our business, Hitachi conducts appropriate tax governance throughout the Group by identifying tax risks

the anti-bribery laws and regulations of countries and regions that have become increasingly strict in recent years, including the U.S. Foreign Corrupt Practices Act(FCPA). We conduct various anti-bribery and anti-corruption initiatives, including internal education for our employees.

on a quarterly basis under the management of the CFO.

Introduction

GovernanceCorporate GovernanceBusiness Ethics and Compliance
Executive Summary

Business Ethics and Compliance
Risk Management
Information Security
Governance DataManagement

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

143

Business Ethics and Compliance
Doing Business Ethically, Honestly andTransparently
Approach

GRI 2-26/3-3

The Hitachi Group Code of Ethics and Business Conduct
https://www.hitachi.com/corporate/about/conduct/pdf/conduct_e.pdf

Under the leadership of the Chief Compliance Officer (CCO),

https://www.hitachi.com/procurement/csr/EN_HG_SPG.pdf

who oversees overall business ethics and compliance, Hitachi
conducts the One Hitachi Compliance Program to strengthen

ance are the foundation of the company, and we promote fair,
open environments in which every employee acts ethically andmaximizes performance. In addition to ensuring compliancewith laws and regulations, we encourage an understanding of

GRI 2-13/2-24/3-3

Structure

Hitachi Group Sustainable Procurement Guidelines

The Hitachi Group believes that business ethics and complitransparent, and honest management. We strive to create

Ethics and Compliance Structure

Compliance With the Hitachi Group Code of
Ethics and Business Conduct
PolicyGRI 2-23/3-3

business ethics and compliance throughout the Group. In
addition, the CCO reports important compliance mattersregularly to the members of the Audit Committee, which consists solely of non-executive directors of the Board. In addi-

the Hitachi Group Code of Ethics and Business Conduct,

All employees who complete the annual business ethics andtion, we established Regional Compliance Managers in Japan,

various rules, and other regulations, not only among employ-compliance training via e-learning pledge to comply with theAsia-Pacific (APAC), Europe, the Middle East and Africa

ees, but also among business partners. We promote a culturegroup-wide Hitachi Group Code of Ethics and Business(EMEA), North America, India, and South America to supportof speaking up to ensure appropriate reporting and action in

Conduct (the “Code”).

regional business units (BUs), Group companies, and other

The Code defines the basis for decisions and actions

entities to meet global and local compliance and regulatory

and regulations or the Hitachi Group Code of Ethics andacross a range of matters, including business ethics, conflicts

requirements. Regional Compliance Managers also play a role

Business Conduct.

of interest, fair and free competition, sustainability, humanin facilitating collaboration across the Group.

the unlikely event of a violation or suspected violation of laws

The Hitachi Group Identity embodies our mission, therights, respect for diversity and individuality, and community

Hitachi Founding Spirit, and the Hitachi Group Vision. We

involvement. In March 2023, we performed a complete revi-

believe this Identity is an important part of the Hitachi Groupsion of the content to be more broadly responsive to theBoard of Directors

commitment to business ethics and compliance. Through the

expectations of a changing global social environment. The

Audit Committee Members

One Hitachi Compliance Program, which aims to strengthen

Audit Committee members received a report regarding thecompliance throughout the Group and organization globally,

revisions of the Code.

Hitachi fosters a corporate culture in which every employee

The Code has been prepared in more than 20 languages.

understands what is expected of them and acts with integrity

The Japanese and English versions are published on theand fairness.

Hitachi, Ltd. website, and other languages are available on the

Further, we ensure business ethics and complianceintranet servers of Hitachi, Ltd. and other Group companies tothroughout the value chain through the Hitachi Group

ensure familiarity and practice by all executive officers,

Sustainable Procurement Guidelines, which serves as a code

employees, and relevant stakeholders. The Complianceof conduct for procurement partners to follow in understanding

Division leads an annual review of the Code to ensure effec-

Hitachi’s commitment to compliance with laws, regulations,tiveness and to reflect legislative and regulatory updates, as

and ethical standards, as well as our commitment to respect

well as changes in social conditions.

for human rights.

Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

Regular Reports to the
Audit Committee Members

Chief Compliance Officer (CCO)
BUs, Group Companies
Heads of Ethics andCompliance

Support by
RegionRegional ComplianceManagers
Japan
APAC

Compliance Managers

EMEA andNorth America
India

Persons in Charge ofComplianceSouth America

Introduction

GovernanceCorporate GovernanceBusiness Ethics and Compliance
Executive Summary

Business Ethics and Compliance
Risk Management
Information Security
Governance DataManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

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Ethics and Compliance Risk Assessments

More than 1,200 selected Heads of Ethics and Compliance,

culture. We established a KPI based on the results of anCompliance Managers, and Persons in Charge of Compli-

awareness survey on corporate ethics and compliance com-ance and others from Hitachi Group BUs and Group compa-

missioned to Ethisphere, a U.S. research institute specializing

nies around the globe work to streamline business ethics

in global corporate ethics. Our target is to achieve a standard

To date, Hitachi conducts a comprehensive business ethics

standards to drive the efficiency and effectiveness of the One

score of 60 points or higher (100-point scale) in the first year,

and compliance risk assessment, including anti-bribery,

Hitachi Compliance Program.

improving each year thereafter. We achieved a score of 76.5 inanti-corruption, and competition law compliance, for all

The Heads of Ethics and Compliance, Compliancethe first survey, conducted in June 2023, and we intend toGroup companies every three years. This assessment verifies

Managers, and Persons in Charge of Compliance and others

continue to make improvements under the One Hitachi Com-the effectiveness of measures taken to manage and correctat each BU and Group company are key stakeholders inpliance Program.

significant risks, and we take appropriate corrective actions

promoting ethics awareness among management andActivities

GRI 205-1/205-2

when matters requiring improvement are identified. As of theemployees. They coach colleagues through ethical dilemmas,

Business Ethics and Compliance Training

beginning of fiscal 2023, each of the Regional Compliance

raise concerns and potential risks to their Legal Division or

Hitachi conducts annual business ethics and complianceManagers are responsible to strengthen cooperation with

Hitachi, Ltd. global compliance office and conduct investiga-

training for all employees (including temporary and part-timeGroup companies in their countries and regions of responsi-

tions when appropriate.

workers) based on the Hitachi Group Code of Ethics and Busi-bility. Each Regional Compliance Manager also provides

ness Conduct and internal rules. Participants in the e-learning

support to enhance risk identification and mitigation at each

Compliance Managers, and Persons in Charge of Complianceprogram pledge to comply with the Hitachi Group Code ofGroup company.

and others, the Compliance Division provides updates on

Ethics and Business Conduct and other relevant standards

ethics and compliance initiatives, trends, and additional

during the training.

In regular meetings with Heads of Ethics and Compliance,

resources to support them as they fulfill the responsibilities of
their role.

TargetActivities

Hitachi develops and implements strategy and initiatives todrive an ethical culture throughout Hitachi’s 800-plus Group
companies. This approach is part of Hitachi’s effort to provide
all employees with guidelines and resources that ensure they
understand and do what is right, make ethical decisions, andsupport compliance with company policies, procedures, andlegal requirements.

TargetHitachi maintains a reputational due diligence program includ-

Achievements in Fiscal 2022

Cultivating a Culture of Ethics andCompliance

Materiality

At Hitachi, we encourage employees to apply high ethicalstandards in their day-to-day work as we improve our ethicalDue Diligence on Third Parties

Our fiscal 2022 training course covered business ethics,
bribery and corruption, gifts, travel and entertainment,anti-money laundering laws, fraud, fair competition,
information owned by others, data protection, conflictsof interest, reporting and non-retaliation, and the Hitachi
Global Compliance Hotline. This training encouraged
higher levels of compliance awareness in the Group.
The participation rate was 95.1% globally. In addition,
we conduct data analysis on the level of understanding
among training participants by region and job category,as well as the time required for training via e-learning,for use in identifying areas of risk or need for additional
training. Hitachi, Ltd. also conducted live training for
new employees, and additional compliance training for
mid-career hires and newly-­appointed managers toensure a complete understanding of the Hitachi Group
Code of Ethics and Business Conduct.

ing the introduction of a third-party management system toidentify reputational risks associated with bribery, corruption
and other factors related to potential business partners withwhom Hitachi plans to begin business. This program assists
in preventing Hitachi from engaging with parties that haveacted or are likely to act in a manner inconsistent with
Hitachi’s ethical culture.
We also conduct an annual screening of business partners with whom we have already conducted transactions tocheck for any concerns that may have arisen in the interim.

Introduction

GovernanceManagement

Social Innovation

Strengthening our Speak-up Culture

Business Ethics and Compliance

GovernanceSocialPhone numbers for the Hitachi Global Compliance Hotline

Assurance

Hitachi Sustainability Report 2023

145

investigation is needed, appropriate investigative personnel

are available for all employees and other stakeholders toare assigned. For concerns that are substantiated, disciplinary

speak to a representative in their native language. The phoneactions may be taken. Discipline comes in many forms from

Hitachi believes that a speak-up/listen-up culture—wherelines are staffed by specially trained third-party representa-

warnings to suspensions to termination.

GRI 2-25/2-26

ApproachCorporate Governance

Environmental

employees are encouraged to raise concerns and feeltives, with translators in more than 50 languages. Web-based

The Chief Compliance Officer reports to, and receives

Executive Summary­confident that they can do so without fear of retaliation—isreporting is also available. We store data supplied in a reportnecessary instructions from, members of the Audit Committee

Business Ethics and Complianceessential to the early detection and prevention of breaches ofon secure servers maintained by the third party who adminis-

on a quarterly basis regarding the number of cases reported,

ethical and regulatory expectations. We are committed toters the hotline.

trends, etc. Serious incidents of noncompliance are immedi-

Risk Management
Information Security
Governance Data

ensuring our employees feel safe to speak up, to share alle-

To address and resolve contacts to the Hitachi Global

gations and to challenge how business is conducted without

Compliance Hotline efficiently, we assign inquiries to an inves-

fear of retaliation.

tigator who is a subject matter expert.

When an employee discovers a violation or suspectedviolation of laws, regulations, or the Code, or when employees

the relevant department (Human Resources, Compliance andIn fiscal 2022, we received 1,276 reports from all Group
companies worldwide.

After a confidential review of the concern, the investigator
determines which reports require an investigation. If an

have questions about business activities in general, we encourage employees to consult or report the matter to their leaders,

ately reported to the Chief Compliance Officer.

Hitachi Global Compliance Hotline
https://secure.ethicspoint.eu/domain/media/en/gui/109107/index.html
P.103 Hitachi Global Compliance Hotline

Reporting and Monitoring Structure

Legal), or to the Hitachi Global Compliance Hotline.
Audit Committee Members
Hitachi Global
Compliance
HotlineHitachi Global Compliance Hotline(Whistleblower System)
SystemActivities

ReportGRI 2-25/2-26/2-27

Supervise

Chief Compliance Officer (CCO)The Hitachi Global Compliance Hotline is a reporting system
operated by a third-party organization and is available

Report24/7/365 to Hitachi Group employees, business partners

Supervise

Report(including procurement partners and contractors), and allother stakeholders. To ensure that no one is treated unfairly,

AnswerCompliance Divisions

anonymous reporting is permitted when legal, and all information received is kept strictly confidential except as neces-

Whistleblowerssary to conduct an investigation.
Consultation and reporting are available by phone oronline for all matters involving possible misconduct, including
violations of laws and regulations, violations of the HitachiGroup Code of Ethics and Business Conduct, and humanrights violations, including harassment.

Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

Investigations
Responses
Statistics Analysis

Introduction

GovernanceManagement

Social Innovation

Environmental

SocialGovernance146

Hitachi Sustainability Report 2023

Assurance

Details of Fiscal 2022 Consultations and Reports

Categories

Corporate GovernanceBusiness Ethics and Compliance1
HR issues (labor management,
travel expenses,
commuting costs, etc.)2Harassment

3
Financial

4
Procurement

5
Competition law

6
Bribery

7
Other

Total

Executive Summary

Americas

87

125

4

6

1

5

115

343

Business Ethics and Compliance

Europe(including CIS)

63

52

4

4

0

3

76

202

Middle East andNorth Africa

13

15

1

0

0

2

28

59

Sub-Sahara

1

1

0

2

0

0

0

4

APAC
(excluding Japan)

47

55

9

13

1

19

96

240

Japan

83

209

16

4

0

2

114

428

Total

294

457

34

29

2

31

429

1,276

Risk Management
Information Security
Governance Data

Areas where
whistleblowing
cases occurred

Anti-Bribery and Anti-Corruption
PolicyActivities

number of times that entertainment, gifts, and other arrangeGRI 205-2

Hitachi has made it clear that we will not tolerate any bribery,
kickbacks, or other corrupt behavior by employees or busi-

ments may be provided to public officials. We also have poli-

Fiscal 2022 Initiatives

cies banning facilitation payments and requiring due diligenceIn fiscal 2022, Hitachi began building a system forprocedures for business partners.

­conducting Due Diligence and creating Due Diligence

In addition, as an effort to manage the risk of corrupt prac-

reports using a new platform from an external service

ness partners, or any conduct that violates the anti-bribery

tices, we established and implemented procedures forprovider and assigning several Due Diligence analysts

laws and regulations of countries and regions, including the

pre-screening of (1) the provision and acceptance of gifts,

from inside the company to an internal global compli-

U.S. Foreign Corrupt Practices Act (FCPA).

entertainment, and travel expenses; (2) the selection of busi-

ance team. The goal of this system is to improve andWe established the Hitachi Group Code of Ethics andness partners; (3) donations and political contributions; and (4)standardize business partner screening, as well as toBusiness Conduct, the Hitachi Group Anti-Bribery and Anti-business acquisitions, joint ventures, and other forms of invest-

create and maintain records, when initiating or renewing

Corruption Policy, and rules and guidelines related to thement and financing for each transaction type. In doing so, wetransactions with business partners globally.

provision and acceptance of gifts, entertainment, and travel

take into account the risk of corrupt practices by country/

expenses; donations and political contributions; conflicts ofregion in the screening procedures according to the score ofinterest; and business partner screening procedures. Under

the Corruption Perceptions Index (CPI) published annually bythese policies, when providing or accepting entertainment orTransparency International and other relevant factors.

gifts, or making donations or political contributions, executive
officers and employees must not exceed the scope of actions
permitted by anti-bribery laws and regulations and mustcomply with Hitachi’s internal rules. These policies indicate
specific spending limits in terms of monetary value and theIntroduction

GovernanceManagement

Social Innovation

Environmental

SocialGovernance

Hitachi Sustainability Report 2023

Assurance

147

Educational Activities for Preventing Bribery andCorrupt Practices

Educational Activities for Preventing Violations ofCompetition Law

inspecting payment details for red flags. Additionally, we

One of the major topics in the Hitachi annual business ethics

As with our anti-bribery and anti-corruption initiatives, Hitachi

and terrorist financing.

and compliance training is the prevention of bribery and corrup-

addresses compliance with competition laws as one of thetion. This training includes more specifics on gifts, travel, andmain topics in our annual business ethics and compliance

Executive Summary

entertainment from the perspective of preventing bribery andtraining. In this way, we strive to ensure that all relevant rules

Business Ethics and Compliancecorruption. In fiscal 2022, 331,525 employees received training

and operational standards are fully understood. In addition,

on anti-bribery and anti-corruption. In addition, we post Group-

we prepare standards related to global contact with competi-

wide educational materials on anti-bribery and anti-corruption

tors for overseas employees to inform them of the practicali-

The basic Hitachi export control policy is to comply withon the intranet for use by all Group companies.

ties involved.

export and import laws and regulations on a global basis to

Corporate GovernanceBusiness Ethics and Compliance

Risk Management
Information Security
Governance Data

In conjunction with the United Nations’ International Anti-

refamiliarize themselves with the Hitachi Group Code of Ethics
and Business Conduct and Hitachi Group Anti-Bribery andAnti-Corruption Policy to ensure consistent anti-corruption.
In addition, we share the latest enforcement policies of theExport Controls
Approach

Activities

maintain international peace and security, and to manage

Corruption Day on December 9, we posted an article on the
Hitachi Group employee news website, calling on employees toinclude clauses in contracts which prohibit money launderingexports appropriately in accordance with internal regulations.

Prevention of Antisocial Transactions andMoney Laundering
Approach

Activities

Hitachi, Ltd. established Corporate Regulations concerning
Security Export Control based on this policy to ensure implementation of strict export control practices in line with relevantlaws and regulations. We screen all goods and technologies

To cut off all relationships with antisocial forces, the Hitachiintended for export against such factors as destination coun-

U.S. Department of Justice on bribery, corruption, and otherGroup Policy Against Money Laundering and Antisocial

tries and regions, as well as intended end use and end users.

corporate crimes at regular meetings for Heads of Ethics andTransactions includes provisions stating that we will neverWe provide guidance and educational support for the formula-Compliance, Compliance Managers, and Persons in Charge ofengage in antisocial transactions under any circumstances,tion of regulations and the establishment of frameworks toCompliance and others at Group companies. The meetings

and will refuse any improper demands and unfair deals.

Hitachi Group companies to ensure that Group companies

are designed to expand the knowledge of Heads of Ethics andIn Japan, we insert antisocial-force rejection clauses inCompliance, Compliance Managers, and Persons in Charge ofcontracts. If we determine that a business partner belongs toCompliance and others, as well as to confirm the rationale andan antisocial force, we can promptly void the contract andAs part of our training program for all Group companies,

direction of the Hitachi Group compliance program.

end the relationship. The Hitachi Group acts decisively to

we offer courses and e-learning programs on export controls,

eliminate approaches from antisocial forces in partnershipconsisting of a basic e-learning program in 14 languages andwith external specialist institutions (the National Center foran e-learning program for practitioners in Japanese andRemoval of Criminal Organizations or the police).

English. Hitachi strives to ensure that export controls are

Fair Competition
PolicyActivities

In fiscal 2020, we revised our rules by adding provisions
for the prevention of money laundering in addition to the

Hitachi engages in business in accordance with the law andprevention of antisocial transactions. These provisions rein-with business ethics, and we practice fair and open competi-

force Hitachi’s stance and clearly establish that we will nottion. We have also established operational standards in addition

tolerate involvement with persons or organizations engaged

to the Hitachi Group Code of Ethics and Business Conductin money laundering or other illegal activities within or outside

and the Hitachi Group Fair Competition Policy. In fiscal 2021,

of Japan. Using a risk-based approach, we conduct due

we revised the guidelines for preventing cartel activity anddiligence on prospective customers and business partners,

improved the relevant forms based on the revised guidelines.

including checking against country sanctions lists andfollow the same export control policies in accordance with
relevant laws and regulations.

thoroughly enforced throughout the Group.

Introduction

GovernanceManagement

Tax ComplianceApproachCorporate GovernanceBusiness Ethics and Compliance

Social Innovation

GRI 207-1/207-2/207-3/207-4

To respond to tax risks associated with the globalization ofSocialGovernanceties in various countries, Hitachi conducts appropriate tax

Business Ethics and Compliancegovernance throughout the Group by identifying tax risks on aquarterly basis under the management of the CFO.
To ensure thorough compliance with these rules, we

Hitachi Sustainability Report 2023

148

Stakeholder Collaboration and Engagementawareness of these rules and ensure that they are followed.

Hitachi continues efforts to build relationships of trust through*1 OECD (Organisation for Economic Co-operation and Development)*2 BEPS (Base Erosion and Profit Shifting)sincere responses to tax authorities and to reduce tax risks
through researching appropriate tax treatment in consultation
with external tax advisors. We also collaborate with the business community through industry associations to lobby for

Tax Compliance Initiatives
Activities

Information Security

strive to raise awareness among all employees involved in

By following the relevant tax-related rules applicable to theGovernance Data

tax management (filing and paying taxes, handling tax

Group as a whole, Hitachi manages tax risks associated withaudits, and managing tax risk) and in the handling of otherglobalization. For example, we strengthen risk management

tax-related matters.

and compliance with laws and regulations by identifying and

1. Group companies strictly comply with all relevant laws

Assurance

to ensure compliance. As stated above, we strive to raise

our business, including tax audit and litigation by tax authori-

Executive Summary

Risk Management

Environmental

viable tax reform that contributes to stronger international
competitiveness on the part of Japanese companies.

Violation of Laws and Regulations
Activities

GRI 205-3/206-1

sharing matters indicated by the tax authorities and tax-­

In fiscal 2022, we recorded no incidents in which Hitachi wasrelated legal proceedings in each country.

prosecuted or penalized by authorities for bribery, corrupt

and implement tax management when pursuing their

The results of our tax filings and tax audits in Japan arepractices, competition law or export control. Regarding tax

business activities, bearing in mind such international

reported to the CFO, and we work continuously to ensurecompliance, Hitachi acts in accordance with all applicabletax compliance standards as the Transfer Pricing

appropriate tax reporting and prevent fraud. In preparing tax

laws and regulations, and we did not record any significant

Guidelines for Multinational Enterprises and Tax

filings, we determine whether anti-tax haven legislationfines or nonmonetary sanctions for noncompliance with tax

Administrations of the Organisation for Economic

applies. When legislation applies, we reflect said rules properly

laws and regulations.

Co-operation and Development (OECD)*1, as well as

in the tax filing to ensure appropriate tax payments.

that body’s Action Plan on Base Erosion and Profit
Shifting (BEPS)*2.

Hitachi follows rules for transfer pricing management andmanages transfer pricing in accordance with the OECD

2. Group companies effectively, continually, and proac-

Transfer Pricing Guidelines and the laws and regulations on

tively manage tax-related issues in a manner befitting

transfer pricing in each country or region where Group com-their status as socially responsible organizations, main-

panies are located.

taining Hitachi brand value and seeking to maximize
shareholder value.
3. Group companies build sincere and positive relations oftrust with the tax authorities in the regions where thesecompanies do business, striving to maintain anddevelop those relations.
In accordance with these policies, we established rules ontransfer pricing management for Group companies, seeking to
identify and mitigate potential taxation risks related to transfer
pricing in transactions with foreign-affiliated parties, as well as

We paid 170.8 billion yen*1 in income taxes for the fiscal
year ended March 31, 2023 (Japan: 64%, Overseas: 36%*2 ).
*1 Refer to income taxes paid in the consolidated statements of cash flows*2 Based on the percentage in the country-by-country report submitted to tax
authorities

Introduction

GovernanceManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

149

Risk Management

Corporate GovernanceBusiness Ethics and Compliance

Risk Management
Executive Summary

Basic Concept
We have seen the emergence of social issues such as rapid digitalization and complex global political and economic change, as well as environmental issues such as climate change, resource
depletion, and large-scale disasters. In response, the business environment has become so volatile that it is difficult to predict the future, and the response to these changes has become amajor factor in maintaining business models. Hitachi strives to comprehend and analyzes this business environment quantitatively and qualitatively. Based on social issues, our competitive

Addressing Risks and Opportunities

environment, and management resources, we engage in risk management from the perspective of responding to risks and opportunities for further growth, creating profit-earning opportunities

Business Continuity Initiatives

while controlling risks.

Information Security
Governance Data

Topic

Addressing
Risks and
Opportunities
Business
Continuity
Initiatives

Overview

In April 2022, Hitachi established a new Risk Management Meeting within the Senior Executive Committee to deliberate and determine materialities related to companywide risks. The President serves as chair of the Risk Management Meeting and the chief risk management officer (CRMO) serves as vice-chair. By managing thediverse risks of Hitachi’s global operations centrally, we are building a solid management foundation that is aligned with growth strategies.
We provide the Hitachi Group Guidelines for Developing Business Continuity Plans to Group companies to enhance our preparation for major disasters and otherrisks. In addition to strengthening safety and business continuity measures in the event of natural disasters such as large-scale earthquakes in Japan as Natural
Disaster BCPs, the procurement departments of business units (BUs) and major Group companies in Japan strive to enhance procurement BCPs to minimize theimpact of future incidents.

Introduction

GovernanceCorporate GovernanceManagement

Social Innovation

Environmental

With the rapid advance of digitalization and complex developments in the political and­economic landscape globally, the business environment is changing with each day. In the Risk

Risk Management

Management Meeting, which is chaired by the President with the Chief Risk Management

Addressing Risks and Opportunities
Business Continuity Initiatives

Assurance

Hitachi Sustainability Report 2023

150

Addressing Risks and Opportunities

Business Ethics and Compliance

Executive Summary

GovernanceSocialGroup Governance Efforts
PolicyActivities

Officer (CRMO) acting as vice-chairperson, Hitachi monitors and analyzes this business environ-

We amended our Group Governance Policy in April 2023. The policy aims to clarify how thement quantitatively and qualitatively and manages risks in terms of the response to risks that

Hitachi Group’s governance should function and to explicitly state responsibilities and roles ofHitachi should prepare as well as opportunities for further growth in light of, for example, social

different organizations given Hitachi’s presence as a global enterprise.

issues, competitive advantages and management resources. We will create revenue opportuni-

Achieving sustainable growth through the global expansion of the Social Innovation BusinessInformation Security

ties while controlling risks. We will identify severe risks that could potentially have a significant

requires group-wide optimal management, based on the Group’s common aim, to reflect global

Governance Data

impact on Hitachi’s operations in terms of the nature of risk events, the expected time period,

perspectives and diverse values in our business management and efficiently allocate manage-

the likelihood of their occurrence and their seriousness when they do occur, and we discuss

ment resources. Based on this policy, the Hitachi Group integrates its management to formulate

and implement measures against the risks. By identifying the various risks Hitachi faces whileand execute the Group’s strategies in pursuit of synergies within the Group, strengthen its man-operating around the world, we are working to achieve a solid management foundation that isagement foundation through common discipline and rules, and streamline business manage-

linked to our growth strategy.

ment through the standardization of our global operations. In this way, we will accelerate our
global growth by ensuring the transparency and fairness of our business management, protecting the Hitachi brand’s value and promoting our Social Innovation Business.

Hitachi’s Risk Management Structure
GRI 2-12/2-13/2-24/3-3/403-2

Structure

We established five working groups (WGs) according to types of risk under the Risk
Management Meeting. The WGs utilize related group corporate functions and manage respective risks appropriately.
Risk Management Structure

Board of Directors
Senior Executive Committee
Risk Management Meeting
CRMO
Risk categories / Working Groups
Investment risks

Business risks

Crisismanagement

ComplianceGroupgovernanceコンプライアンス
本部

安全衛生マネジメント
推進本部

営業統括本部

投融資審査統括本部

推進組織
投融資戦略委員会室Introduction

GovernanceManagement

Social Innovation

Environmental

Crisis Management Initiatives

Risk Management

example is quick action taken in the event

Executive Summary

Addressing Risks and Opportunities
Business Continuity Initiatives

that a crisis occurs. Even in ordinary
times, we are ready to take action against

sale of assets, orders for projects) to facilitate our response to risks and secure growth opportuni-

Occurrenceof crisisties. Hitachi has a framework for delegation of authority within a three-layer deliberation structure—the Board of Directors, the Senior Executive Committee and the business units—in
accordance with the size and details of the project to ensure appropriate and flexible decision

Potential risks

each of the serious risk categories toenhance our preparedness for contingen-

Information Security

cies and ensure appropriate action. In

Governance Data

fiscal 2022, our corporate measures in theareas of large-scale natural disasters inJapan, as well as cybersecurity and otherrelated issues, were strengthened andreviewed. Our aim was, for example, tomaking when carrying out an investment or other activity. For important projects, the Investment

infrastructure. In fiscal 2023, the expansion of our measures for business units

Various risks

Management of serious risks

Response whena crisis occurs• Establishment of a task force• Consolidation and centralization of
information• Initial response, implementation ofabatement measures

Strategy Committee, an advisory body consisting of members of our corporate divisions, examines risks in a multifaceted manner to submit a report (including recommendations of approval or

Crisis Management WG
Responding to
non-serious risks• Ongoing monitoring• Consideration of categorizing a
non-serious risk into serious risks

disapproval) to the Senior Executive Committee whose members include the President. After aninvestment is executed, we periodically monitor the status of the project. If the project fails toproceed as planned, we have a framework in place to decide whether to continue with the investment, which might lead to a decision to withdraw. The aim is to enhance our capital efficiency.
In response to changes in the economy finance, geopolitics, customers and other compo-

Preparations under normal conditions

nents of the management environment (risks and opportunities), the criteria for providing invest-• Preparation of response and operational steps based oncrisis scenarios• Conducting drills, revising procedures, responding to issues• Reconfirming business continuity plans

ment and post-implementation monitoring (including PMI) are continuously strengthened in an

facilitate the migration of major systems to
the cloud and duplicate our information151

Hitachi has a proper framework of decision making in different phases of investment (e.g., M&A,
Severity

achieve more sophisticated resilience. An

Hitachi Sustainability Report 2023

Structure

For crisis management, Hitachi strives toBusiness Ethics and Compliance

Assurance

Efforts Against Investment Risks

Activities

Corporate Governance

GovernanceSocialand the Hitachi Group companies as well as Diagrammatic drill, among other initiatives, will bestrengthened to enhance the Group’s resilience globally.

Framework of Decision Making
After an investment
is executed

When an investment
is executedCompliance Initiatives
Activities

effort to achieve the Mid-term Management Plan and capital allocation plans.

GRI 201-2

Resolution by the
Board of Directors(particularly importantmatters)

Board ofDirectors

As a cross-sectoral compliance initiative, four related departments worked together and shared

Chairperson: CRMO

information with one another in fiscal 2022 regarding the measures implemented by each department under regular conditions (e.g., development of regulations, training, monitoring, audits) andhow to handle contingencies in the event that they arise (e.g., communication with internal andexternal stakeholders including senior management when a major risk manifests) to handle major

Approval by the
President(important matters)

compliance-related risks that concern corporate ethics and laws, the environment, quality, andSenior Executive
Committee
Risk Management
Meeting

health and safety. These departments work to strengthen their cooperation in terms of management
methods in different categories of risks. In this way, we have sought to raise the level of our risk
management in the different categories and reduce risks. In fiscal 2023, we will seek to establish anorganizational climate for encouraging employees to speak up and preventing violation of laws andinternal rules with the aim to reduce the Hitachi Group’s compliance-related risks.

Approval by the BU
CEO or executive
officer in charge ofthe sector

Business Unit
(BU)

Business withdrawal,
sale or continuation

Investment Strategy
Committee

ReportA committee whose
members are from related
corporate divisions such as
the Finance Group

Clarifies the risk factors fora proposed matter,
identifies important
discussion points, andissues a report (including
recommendations ofapproval or disapproval)

ReportSenior Executive
Committee
Decision by the BU to withdraw
from, divestiture or continue
with the business

Conflicts withspecified conditions

Monitoring byhead office

Monitoring by the BUIntroduction

GovernanceManagement

Social Innovation

Environmental

SocialQuantitative Understanding of Risks
Activities

Corporate Governance

Hitachi calculates expected maximum risks (Value at Risk) by statistical methods according toBusiness Ethics and Compliancethe type of assets held on the group’s consolidated balance sheet. Similarly, the risks of increas-

Risk Management

ing the backlog of long-lead projects have been quantified since fiscal 2022.

Executive Summary

Addressing Risks and Opportunities
Business Continuity Initiatives
Information Security
Governance Data

We avoid missing out on growth opportunities by visualizing the capacity for growth investment, etc., considering consolidated net assets and other factors. We also engage in monitoringand hold discussions through the Risk Management Meeting to ensure that risks are not excessively unbalanced compared to Hitachi’s consolidated financial strength.
We also quantitatively analyze and understand the state of risks and profitability on a regional
and per-sector basis.

Responding to Climate Change Risks and Opportunities
Activities

GRI 201-2

In June 2018, Hitachi announced its endorsement of the recommendations by the Financial
Stability Board’s (FSB) Task Force on Climate-related Financial Disclosures (TCFD).
P.043 Climate-related Financial Information Disclosure (Based on TCFD Recommendations)

For details of the risk factors, please refer to page 34 of the Annual Securities Report (the154th business term).
Annual Securities Report (the 154th business term) P.34
https://www.hitachi.com/IR-e/library/stock/hit_sr_fy2022_4_en.pdf

Governance

Assurance

Hitachi Sustainability Report 2023

152

Introduction

GovernanceCorporate GovernanceBusiness Ethics and Compliance

Risk Management
Executive Summary
Addressing Risks and Opportunities

Business Continuity Initiatives

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

153

Business Continuity Initiatives
Approach to Business Continuity Plans (BCPs)
Approach

Activities

BCPs Initiatives

ucts. Based on our experience with the various impacts e.g.

Activities

lockdowns caused by COVID-19 and wars, we will accelerate

Given the close relationship of our business to social infra-

Hitachi, Ltd. continues to strengthen measures against natural

structure, we continue to strengthen BCPs to ensure that thedisasters by conducting annual earthquake drills, which simu-

impact of risks do not disrupt our business and thereby

late a major seismic event.

Guidelines for Developing Business Continuity Plans (Overview)

Governance Dataand the Hitachi Group Guidelines for Developing BusinessContinuity Plans (By Department) in Japanese, English, andDrill Simulating Earthquake Measures

FY2020• Drills to set up an earthquake task force on aremote-work basis on the assumption that all
work must be conducted remotely

Chinese for distribution to all Hitachi Group companies toGroup Guidelines for Pandemic Influenza Preparedness foron the assumption that not everyone can assemble at the office on weekdays and that there is a
mix of those who come to the office and those
who work from home

FY2021

Group companies. These guidelines served as a useful tool in
dealing with the COVID-19.
We also appointed personnel with responsibility for risk-­
response policies at our main overseas bases. Major Group
companies outside Japan prepared BCPs to strengthen

FY2022

response to business risks including major disasters, infec-• Conducted training for remote workers, assumingthat headquarters disaster-response staff living inareas subject to JMA Seismic intensity 7 are notable to participate in drills in person; simulated anearthquake occurring directly under the Tokyo
metropolitan area during daylight on a weekday

tious diseases, political instability, social disruption, and acts

Procurement BCPs Initiatives
Hitachi, Ltd. and its Group companies in Japan have formulated

Approach

Activities

BCPs for each business in preparation for major earthquakes,

Hitachi enhances procurement-related business continuity

wind and flood damage, and novel strains of influenza. Eachplans (BCPs) across Group companies worldwide to ensurebusiness division reviews its BCP regularly and makes revisions

significant incidents*1 do not disrupt our business or seriously

as necessary to reflect the latest risk assessment results. In fiscal

impact the society.

2022, Hitachi, Ltd. and its Group companies in Japan strength-

BUs and key Group companies outside Japan as approprian effort to enhance procurement BCPs throughout theGroup worldwide.
*1 Events such as natural disasters (including major earthquakes) serious enoughto disrupt business

Achievements in Fiscal 2022
We have introduced the Procurement BCPs
Management System for our procurement partners inJapan to share information (on contingency impact
surveys) efficiently among Hitachi Group companies
during disasters.
In fiscal 2022, we added a new function to identify
the locations damaged by typhoons and other windstorms in a timely manner, which have been increasingof terrorism.

Formulation of BCPs

We share these activities with procurement divisions in• Remote drills using a Web conferencing systemenhance preparedness for major disasters and other risks.
Regarding infectious diseases, we released the Hitachi

the above measures.

ate, making use of this information in reviewing strategies in­significantly affect society. We published the Hitachi Group

Information Security

strategically; and (5) consider and promote substitute prod-

To minimize the impact of disasters that may occur, theened BCPs related to infectious diseases such as COVID-19 inprocurement divisions in BUs and key Group companies:

particular, as well as continuity plans in the event of mega-­(1) standardize and use generic parts to make procurement asearthquakes. Group companies outside Japan have formulated

flexible as possible; (2) cultivate multiple suppliers; (3) distribute

BCPs in light of risks of concern in their respective locations.

production across several locations; (4) budget inventory

Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

in recent years.
In the future, we promote systematization of incident identification and survey for overseas procurement
partners in China and other countries.
P.108 Responsible Procurement

Introduction

GovernanceCorporate GovernanceManagement

Social Innovation

Improving Safety for Employees Sent toDangerous Regions

Environmental

SocialGovernance

GlobalLogic Business Continuity Plans
GlobalLogic continues to execute Business Continuity

Activities

Plans (BCPs) in all business locations. Maintaining theBusiness Ethics and Compliance

Hitachi takes all possible measures to ensure safety whensafety of employees as the highest priority, the com-

Risk Management

sending employees to countries and areas at high risk of con-pany continues to operate in Ukraine through BCPs.

Executive Summary
Addressing Risks and Opportunities

Business Continuity Initiatives

flicts, terrorism, and other threats. On-site surveys are also

A diverse distribution of the workforce is a key

conducted by in-house and outside experts beforehand.

factor in the ability of GlobalLogic to operate safely and

In addition, Hitachi, Ltd. participates in the Council for

maintain productivity. A total of 15% of Ukraine team-

Public-Private Cooperation for Overseas Safety organized bymates live and work outside Ukraine, with another one-

Information Security

Japan’s Ministry of Foreign Affairs to enhance collaboration

third located in the relative safety of western Ukraine. In

Governance Databetween the private and public sectors in this area, by which

addition, the company conducts a program to incentiv-

contributes to safety measures at other Japanese corpora-ize temporary or permanent employee relocation totions operating outside Japan.

safer locations inside and outside of Ukraine.
In fiscal 2022, the company improved safety mea-

Achievements in Fiscal 2022

sures and business continuity to prepare for the future,including the opening of 11 satellite offices acrossIn fiscal 2022, Hitachi, Ltd. undertook measures for the

Ukraine. All offices have been equipped with redundanttimely provision of information to ensure the safety of

power and communications infrastructure, including

our employees around the globe. These measuresmultiple satellite internet connections and mobile powerincluded posting information from contracted consul-

banks. The company also maintains a sufficient inven-tants and news agencies on the company’s intranet. In

tory of emergency provisions in its offices.

addition, the company employs an outside specialist to

In addition to the preceding, GlobalLogic imple-

provide medical assistance to Hitachi Group employees

mented a long-range Ukraine de-risk plan beginning in

outside Japan.

fiscal 2023.

Assurance

Hitachi Sustainability Report 2023

154

Introduction

GovernanceManagement

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

155

Information Security

Corporate GovernanceBusiness Ethics and Compliance

Basic Concept

Risk Management

While advancements in digital technologies create new value, there is a growing risk of information leaks and shutdowns due to cyberattacks. These attacks become more sophisticated every

Information Security
Executive Summary

day and could interfere with business continuity. Risk management related to information security has become one of the most important issues for corporate entities. In response, Hitachi,
which aims to be a global leader through our Social Innovation Business, emphasizes cyber security measures from the perspectives of value creation and risk management.

Information Security
Governance Data

Topic

Information
Security

Overview

Based on our information security policy, Hitachi pursues an optimal security structure under the supervision of our chief information security officer (CISO), confirming our sense of unity and agility as One Hitachi. Specifically, we work to prevent information leaks, conduct in-house information security education, and perform
internal audits related to information security.
To address risks associated with the diversification of cyberattack methods, we expanded the scope of security risk management and strive to reduce business risks

Cybersecurity

in the development and verification environment for creating products and services, production and manufacturing environments, supply chains, and product andservice development processes.

Data Protection

As a member of the global community, Hitachi commits to protecting personal information in accordance with a vision for personal information protection summarized as providing safety and trustworthiness, and recognizing the importance of individuals’ rights.

Introduction

Management

Governance

Information Security

Corporate GovernanceApproach to Information Security

Social Innovation

Information Security
Executive Summary

Information Security
Governance Data

GovernanceSocialbased on this policy, and we address the challenges of infor-

Business Ethics and Compliance
Risk Management

Environmental

mation security management on an active basis.

Approach

The progress of digitization has brought new opportunities forcreating value, but this progress also amplifies the risks thatbusinesses face, including information leaks and operational
disruptions caused by increasingly sophisticated cyberattacks
that impede business continuity. To minimize these risks, risk
management related to information security has become oneof the most crucial challenges for companies. Against thisbackdrop, Hitachi, aiming to be a global leader in the Social
Innovation Business, is engaged actively in information security initiatives. We recognize cybersecurity measures as a
crucial management challenge that addresses both value

Assurance

Hitachi Sustainability Report 2023

Framework for Promoting Information
Security
GRI 2-13/2-24/3-3

Structure

Information Security Policy
1. Formulating administrative rules for information security and ensuring their continual improvement
2. Protection and ongoing management of information
assets156

The Chief Information Security Officer (CISO) has overall
responsibility and authority for implementing and operating
information security and personal information protection, andoversees information security for all Hitachi products, services,
and internal facilities.

3. Legal and regulatory compliance

Chaired by the CISO, the Information Security Committee

4. Education and training
5. Preventing incidents and taking action when they occur
6. Ensuring business processes are optimized within
the corporate group

determines all policies and measures for information security
and personal information protection. These policies and measures are announced to all Business Units (BUs) and Group
companies through channels such as the Information Security

creation and risk management. Since Hitachi consists ofnumerous companies, we are pursuing our businesses as a
unified group, One Hitachi. In line with this business policy, we

Framework for Promoting
Information Security
BU

address information security as One Hitachi, as well, striving
to establish optimal security measures and ensure a sense ofunity and agility. To this end, we accelerate the security measures based on common initiatives in accordance with theoverall Hitachi policy.

Hitachi, Ltd. HQ (Corporate)
BU

Group company
Hitachi, Ltd.

Group company

Group company

Group company

Group company
Group company

President & CEO

Chief Information Security Officer (CISO)

Information Security Audit Manager

Information Security Committee
Chairperson (and CISO)
Information Security Training Manager
Committee members: representatives of business sites andheads of HQ management divisions

Information Security Report

Information Security Officer
Audit Officer

Information Security Promotion Council

Information Security Policy
PolicyGRI 2-23

BUs/
Businesssites

Information Security Officer
Information Security Manager
Data Protection Manager

Hitachi created an information security policy to protect infor-

Information Security Promotion Department

mation assets, including information entrusted to us by our

Department for the External Contact

customers, the systems that store that information, and theinformation systems that provide social infrastructure services.
We established various rules and implementation systems

Cybersecurity Manager
Information Systems Administrator
Information Asset Manager

Company president

Information Security Audit Manager

Introduction

GovernanceCorporate GovernanceManagement

Social Innovation

Promotion Council. BU and Business sites operate their own

Environmental

SocialGovernance

To prevent leaks from procurement partners, we review their

Assurance

Hitachi Sustainability Report 2023

157

protection and information security. Internal audits at Hitachi,

information security divisions, with the head of the BU or busi-

information security measures based on Hitachi’s own stan-Ltd. are conducted independently by audit managers

ness site serving as information security officers. These divi-dards before allowing them to access to confidential informa-appointed by the President and CEO. They are not allowed toaudit their own units, which underlines our commitment tosions implement information security management in eachtion. We also provide tools to procurement partners for security

Business Ethics and Complianceworkplace and provide relevant education to employees. This

education and for checking business information on computers.

fairness and objectivity in auditing. The Group companies in

Risk Management

framework is also implemented at Group companies to pro-In addition, we require procurement partners to check andJapan conduct internal audits equivalent to Hitachi, Ltd., andInformation Security

mote information security across the group through mutual

remove business information from personal computers.

all audit results are confirmed by Hitachi, Ltd.

Executive Summary

Information Security
Governance Data

Hitachi requires Group companies outside Japan to use acooperation.

Information Security Management
Activities

Education on Information Security

common global self-check approach to ensure groupwide

Hitachi holds annual e-learning programs on information

inspections. All departments in Hitachi, Ltd. perform self-­

security and personal information protection for all executive

directed personal information protection and information

officers and employees. The participation rate in Hitachi, Ltd.

­security operation checks annually. In addition, departments

in fiscal 2022 was 100% (excluding those who could not

involved in operations that handle important personal informa-

Hitachi established a framework for information security

attend due to personal leave, etc.). Besides, Hitachi offers ation (739*1 related operations identified as of March 2023)

management based on the ISO/IEC 27001 internationalvariety of programs depending on the target and aims, such

perform personal information protection operation checks

standard. We enhance information security by ensuring

as those for new employees, new managers, and lectures forevery month. Through these measures, we check operational

information security response measures comply with theinformation system administrators. Hitachi also implements

status regarding personal information regularly.

United States government standard SP800-171. The

simulation training to educate employees about phishing

Information Security Rules and the Personal Information

attacks and other cyberattacks. Employees receive deceptivetion activities through regular on-site assessments of theProtection Rules including Information Security Standards

e-mails as phishing simulations to heighten their awareness ofstatus of information security measures. A team of in-houseare communicated globally by Hitachi, Ltd. and Group com-security through direct experience.

security specialists is responsible for identifying any deviations

Hitachi is also engaged in groupwide security risk reduc-panies headquarters. Hitachi also makes use of shared

Training programs in Hitachi, Ltd. are shared with thesecurity services and related information security support

Group companies in order to actively implement training on

companies in Japan contract with an external organization toprovided by regional headquarters in the Americas, Europe,

information security and personal information protection in the

conduct quarterly external vulnerability assessments of serv-

Southeast Asia, China, and India.

entire group.

ers open to the public and other external vulnerabilities.

Preventing Information Leaks
Hitachi engages in a number of IT-related measures such as

Information Security Management Evaluation andMonitoring

device encryption, secure PC use, electronic document

Hitachi implements information security and privacy protectionaccess control and expiration processing software, ID man-initiatives based on the PDCA cycle of the information security

agement and access control via authentication infrastructure,

management systems stipulated by Hitachi, Ltd. We conduct

e-mail and website filtering, etc. to prevent information leaks.

regular audits and inspections to monitor and evaluate whether

In response to the recent proliferation of targeted e-mailmanagement and measures for information security and dataattacks and other cyberattacks, we not only participate in anprotection are implemented properly in each department.

initiative to share information between the private sector and

All divisions of Hitachi, Ltd. and Group companies in

the government, but also strengthen various IT measures thatJapan conduct annual internal audits of personal information

include defense-in-depth strategy.
Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

arising from self-checks. Further, Hitachi, Ltd. and GroupIntroduction

GovernanceManagement

Social Innovation

Environmental

SocialGovernance

Cyber-Security Initiatives

Hitachi Sustainability Report 2023

158

Data Protection Initiatives

Activities

Corporate Governance

Assurance

Activities

GRI 418-1

To address the risks posed by the increasing diversification ofCyber-Security Monitoring

As digital technology continues to advance, the global trend

Business Ethics and Compliancecyber-attack methods, origins, and impacts, Hitachi is expand-

The Hitachi Security Operation Center (SOC) monitors security

toward leveraging data only accelerates. This situation has led

Risk Management

ing the scope of our security risk management. Traditionally,on an around-the-clock basis to ensure global-scale cyberat-

to heightened interest in the protection of personal information

Information Security

we focused risk management on response measures for inter-tacks are detected and response measures initiated immedi-

and cross-border data exchange. In such an environment,

nal IT environments. To reduce business risks going forward,

ately. The Incident Response Team (IRT) collects and develops

Hitachi places significant importance on personal information

we will include the development and verification environments

threat information and manages our response to any security

protection initiatives to ensure the secure management ofused to create products and services, production and manu-

incidents.

personal information received from customers and personal

Executive Summary

Information Security
Governance Datafacturing environments, and the supply chain and product/
service development process.

Cyber-attack methods are becoming more sophisticatedinformation involved in business operations. As a member ofevery year, with an increasing number slipping past detection

the global community, Hitachi is committed to protecting

systems. More often, these attacks tend to go undetected for

personal information in accordance with our vision for per-Cyber-Security Management

long periods, resulting in increased damage. In this context,

sonal information protection, which is to provide safety and

Hitachi established standards for internal IT environment-­

Hitachi strengthens cyber surveillance through Endpoint

trustworthiness, and to value individual rights.

related vulnerability response measures and network security.

Detection and Response (EDR)*1 to monitor device behavior

We also require BUs/Group companies to conduct regularand perform authentication protection. We continue to

Personal Information Protection

status assessments of these measures and perform corrective

improve and strengthen our cyber monitoring environment

Hitachi, Ltd. established the Personal Information Protection

actions. As a companywide measure, we launched an initia-

using the latest technology.

Policy which is announced to all executive officers andtive to monitor vulnerability mitigation for each device andfollow up with users/administrators to expand the application*1 Systems to monitor suspicious behavior and respond quickly to attacks on
endpoint devices such as computers.

of such measures.
In the development/test and production/manufacturing

employees, and is also publicly available. Hitachi created apersonal information protection management system basedon this policy. This system ensures the protection of personal
information by such means as appropriate management ofenvironments, we established standards and guidelines for

personal information, educational programs for all employees,

infrastructure construction and operations to ensure security

and periodic audits. We do not share personal information

compliance in each environment, and we pursue measureswith third parties without data subject’s prior consent. Even in

based on these guidelines within the Hitachi Group. We also

cases where prior consent is obtained, Hitachi requires theshare information security requirement standards establishedthird party to whom the data is provided to comply with

by Hitachi with our procurement partners, working coopera-

Hitachi’s Personal Information Protection Policy.

tively to enhance security.

Hitachi also strives to safeguard personal information

We established management guidelines to address andglobally based on each company’s personal information pro-

maintain the security of products and services, and we follow

tection policy, and we ensure that these companies comply

measures based on these guidelines within the Hitachi Group.

with all applicable laws and regulations in each country andregion, as well as to the expectations of society at large.
Personal Information Protection Policy of Hitachi, Ltd.
https://www.hitachi.com/privacy-e/Note: Hitachi normally refers to suppliers (including suppliers, vendors or providers) as procurement partners who build business together on an equal footing.

Introduction

GovernanceCorporate GovernanceManagement

Social Innovation

PrivacyMark Certification

Environmental

SocialGovernance

Hitachi, Ltd. obtained PrivacyMark*1 certification, which is a

Responding to Personal Data Protection Laws
Around the World

third-party certification of personal information protection.

With the increasing risk of privacy violations, lawmakers are

Assurance

Hitachi Sustainability Report 2023

159

Third-Party Evaluations and Certifications
Activities

The entire Hitachi Group is committed to personal information

actively seeking to create and modify relevant laws and legis-

Hitachi encourages the acquisition of third-party evaluations

Business Ethics and Compliance

protection, and 37 Hitachi Group companies in Japan havelation in countries and regions around the world. Hitachi

and certifications for information security management. Our

Risk Management

been granted the PrivacyMark as of the end of July 2023.

ensures thorough global compliance with legal frameworks,

data centers and other divisions obtain certification from thecontinues to monitor related legal frameworks and social

ISMS Accreditation Center (ISMS-AC) in accordance with thetrends, and implements appropriate measures.

ISO/IEC 27001 Information Security Management System

Information Security
Executive Summary

Information Security*1 PrivacyMark: A third-party certification that is granted by the assessment bodythe Japan Information Processing Development Corporation to businesses thathave taken appropriate security management and protection measures related
to personal information (invested by Japan Information Processing
Development Corporation).

In Japan, Hitachi complies with the Amended Act on theinternational standard. Eight divisions have received thisProtection of Personal Information, and in the event that a­certification at Hitachi, Ltd., and 28 divisions representing 23

leak may result in a situation that would harm the rights andGroup companies*1 have also received this certification.

Privacy Protection Initiatives

interests of individuals, Hitachi promptly report said leak to the*1 As of the end of June 2023

In response to social demands for privacy protection mea-

Personal Information Protection Commission and notify thesures, Hitachi, Ltd. aims to provide more appropriate andaffected individuals. We recorded one case of personal infor-

high-quality services and products, and foster trust with con-mation leakage at Hitachi, Ltd. during fiscal 2022. We identi-

sumers and other stakeholders, by balancing privacy protec-

fied the scope of the impact related to this incident and tooktion and the use of personal data.

appropriate action.

Governance Data

In 2014, we established the position of personal data

Hitachi also formulated a groupwide internal code of con-officer to oversee personal data handling in Digital Systems &duct concerning the protection of privacy, which takes into

Services, which drives our digital business. We also estab-consideration international legal frameworks such as thelished the Privacy Protection Advisory Committee to consoli-

European General Data Protection Regulation (GDPR). Thisdate our knowledge on privacy protection, support risk

code of conduct became effective as of April 2022. Moreover,assessments, and consider response measures.

individuals responsible for personal data protection are

Further, we began companywide effort by adopting the
Hitachi Privacy Impact Assessment (PIA) in 2023.
Through these initiatives, we structure measures to prevent issues related to privacy, implementing privacy impact
assessments for operations that involve personal data handled by employees.

appointed in each Group company, and s­ upport functions forregional group companies have been established within eachregional headquarters. In this way, we ensure consistent personal information protection on a global scale.

Introduction

Management

Governance

Governance Data

Corporate GovernanceCorporate GovernanceBusiness Ethics and Compliance
Risk Management
Information Security

Social Innovation

Business Ethics and Compliance

SocialGovernance

Assurance

160

Hitachi Sustainability Report 2023

GRI 405-1/406-1

Leadership Demographics
Unit

Governance Data
Corporate Governance

Environmental

Gender
Total

Directors
Executive officers

PeopleExecutive officers and corporate officers
Ratios of female and non-Japanese executive officers andcorporate officers
Note: As of June 2023
*1 Including 9 independent directors (seven from Japan and two from outside Japan)

%

Male

Nationality
FemaleJapanese

Non-Japanese

1

12*

10

2

7

5

38

36

2

33

5

79

70

9

63

16

11.4

20.3

Introduction

Management

Social Innovation

GovernanceBusiness Ethics and ComplianceCorporate GovernanceBusiness Ethics and Compliance Training

Environmental

Information Security

Governance Data

Governance161

Hitachi Sustainability Report 2023

Assurance

GRI 205-2

Business Ethics and Compliance
Risk Management

SocialReporting BoundaryUnit

FY2018FY2019FY2020

FY2021

FY2022

Number of participants of business ethics and compliance training

Hitachi Group

People———341,888

331,525

Participation rate of business ethics and compliance training

Hitachi Group

%

—

—

—

99.1

95.1

Note: Disclosures began in fiscal 2021.

Corporate GovernanceBusiness Ethics and Compliance

Hitachi Global Compliance Hotline (Whistleblower System)
Reporting Boundary
Number ofcompliance reports

Hitachi GroupFY2019FY2020

FY2021

FY2022

459

639

1,023

1,276

HR issues (Labor management, travel
expenses, commuting costs, etc.)

—

—

—

226

294

Harassment

—

—

—

341

457

Financial

—

—

—

27

34

—

—

—

26

29

Competition law

—

—

—

3

2

Bribery

—

—

—

30

31

Others

—

—

—

370

429

Americas

—

—

—

238

343

Europe (including CIS)

—

—

—

98

202

—

—

—

54

59

Sub-Sahara

—

—

—

13

4

APAC (excluding Japan)

—

—

—

234

240

Japan

—

—

—

386

428

Cases

Procurement(By area)

FY2018—Total(By category)

Unit

Cases

Middle East/North Africa
Cases

Note: Discloses of the total number of cases began in fiscal 2019 and the breakdown in fiscal 2021.

Introduction

Assurance
Assurance

Management

Assurance

Social Innovation

Environmental

Governance

Assurance

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GRI 2-5

To enhance the reliability of the data disclosed in the Hitachi Sustainability Report 2023, wehave received independent assurance of key environmental, social and governance performance indicators by KPMG AZSA Sustainability Co., Ltd. The indicators that were assured aremarked with aSocial.

The standards, guidelines, and calculation methods used in collecting environmental data
are posted on our website.

Calculation Methods for Environmental Load Data
https://www.hitachi.com/environment/data/method.html

Independent Assurance Report
To the Representative Executive Officer, President & CEO of Hitachi, Ltd.
We were engaged by Hitachi, Ltd. (the “Company”) to undertake a limited assurance engagement of the environmental,social and governance performance indicators marked with(the “Indicators”) for the period from April 1, 2022 to March
31, 2023 (or as of June 30, 2023 for the Ratio of Female and Non-Japanese Executive and Corporate Officers) included
in its Hitachi Sustainability Report 2023 (the “Report”) for the fiscal year ended March 31, 2023.
The Company’s Responsibility
The Company is responsible for the preparation of the Indicators in accordance with its own reporting criteria (the“Company’s reporting criteria”), as described in the Report.
Our Responsibility
Our responsibility is to express a limited assurance conclusion on the Indicators based on the procedures we have
performed. We conducted our engagement in accordance with the ‘International Standard on Assurance Engagements(ISAE) 3000, Assurance Engagements other than Audits or Reviews of Historical Financial Information’ and the ‘ISAE 3410,
Assurance Engagements on Greenhouse Gas Statements’ issued by the International Auditing and Assurance Standards
Board. The limited assurance engagement consisted of making inquiries, primarily of persons responsible for the preparationof information presented in the Report, and applying analytical and other procedures, and the procedures performed varyin nature from, and are less in extent than for, a reasonable assurance engagement. The level of assurance provided is thus
not as high as that provided by a reasonable assurance engagement. Our assurance procedures included:• Interviewing the Company’s responsible personnel to obtain an understanding of its policy for preparing the Report andreviewing the Company’s reporting criteria.
• Inquiring about the design of the systems and methods used to collect and process the Indicators.
• Performing analytical procedures on the Indicators.
• Examining, on a test basis, evidence supporting the generation, aggregation and reporting of the Indicators in conformity
with the Company’s reporting criteria, and recalculating the Indicators.
• Visiting the Sawa Plant of Hitachi Astemo, Ltd. selected on the basis of a risk analysis.
• Evaluating the overall presentation of the Indicators.
Conclusion
Based on the procedures performed, as described above, nothing has come to our attention that causes us to believethat the Indicators in the Report are not prepared, in all material respects, in accordance with the Company’s reporting
criteria as described in the Report.
Our Independence and Quality Management
We have complied with the Code of Ethics for Professional Accountants issued by the International Ethics Standards
Board for Accountants, which includes independence and other requirements founded on fundamental principles ofintegrity, objectivity, professional competence and due care, confidentiality and professional behavior. In accordance with
International Standard on Quality Management 1, we design, implement and operate a system of quality management
including policies or procedures regarding compliance with ethical requirements, professional standards and applicablelegal and regulatory requirements.

/s/ Kazuhiko Saito
Kazuhiko Saito, Partner, Representative Director
KPMG AZSA Sustainability Co., Ltd.
Tokyo, Japan
September 1, 2023

Notes to the Reader of Independent Assurance Report:
This is a copy of the Independent Assurance Report and the original copies are kept separately by the Company and KPMG AZSA
Sustainability Co., Ltd.

Introduction

Group Companies

Management

Social Innovation

Environmental

SocialGovernance

Assurance

Hitachi Sustainability Report 2023

163

Hitachi Group Companies’ Sustainability Disclosures

Our Group companies are also actively implementing sustainability initiatives. For the information on the major Group companies that issue sustainability reports, please referto the following website (including Group Companies plan to publish them in fiscal 2023):

GlobalLogic

https://www.globallogic.com/about/esg/

Hitachi Vantara

https://www.hitachivantara.com/en-us/solutions/sustainability.html

Hitachi Energy

https://www.hitachienergy.com/sustainability/sustainability-overview

Hitachi Railhttps://www.hitachirail.com/csr-and-sustainability/sustainability-report-2022/

Hitachi High-Techhttps://www.hitachi-hightech.com/global/en/company/sustainability/Inquiries

Sustainability Promotion Division
6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo,
100-8280, Japan
Tel: +81-3-3258-1111
www.hitachi.com/sustainability/