CSR REPORTTo Build a Trusted Identity as aContributing Member of
the Global Community

CSR REPORTContents

01 Contents / Editorial Policy
02 Message from the Chairman
03 Yokohama Rubber Group at a Glance / Corporate Philosophy
05 Message from the President

Reflecting on Yokohama Rubber’s History and CSR
07 Yokohama Rubber’s 100 Year History of Staying Ahead of Society
Development of Products and Services that Contribute to
11 the Environment and Society

15 YOKOHAMA Forever Forest Project

The Future of Yokohama Rubber and CSR
CSR and Important Issues (Materiality) / Participation in initiatives in Japan and overseas /17 CSR and Environmental Management Promotion System

19 Creating Value through Our Businesses
20 Yokohama Rubber’s Important Issues
21

For the Global Environment

23

Together with Local Communities

25

Together with Our Customers

27

To Our Stakeholders and Investors

29

Together with Our Business Partners

31

Together with Our Employees

33 Our Commitment to Social Challenges over the Next 100 Years
35 ISO 26000 Compliance Activity Report
37 Information Map
38 Third-Party Opinion

Editorial Policy
This report was created to share Yokohama Rubber Group’s policies, approach to CSR, orientation and performance with each of its stakeholders in a concise and clear manner.
On October 13, 2017, Yokohama Rubber celebrated the 100th anniversary of the company ’s founding. Looking ahead to the future, this report introduces our company’s
approach to helping to solve social problems, in line with our goal of building a trusted identity as a contributing member of the global community.
Additional details of our activities can be found on our CSR website, which contains a host of information compliant with GRI Guidelines Ver. 4 about the progress of Yokohama
Rubber Group’s CSR activities. We invite you to review this website together with the print version.
Period covered by the Report: January 1, 2016 to December 31, 2016 (Information includes some activities which were conducted in and after January 2017)
Date of publication: December 2017 (the Report is issued annually)01

Message from the Chairman
Since we began implementation of our GD100 medium-term business plan in fiscal 2006, we have beenworking towards the achievement of clear, specific goals in the run-up to the 100th anniversary of thefounding of Yokohama Rubber in 2017. I feel that we have been successful at coming up with ideas tofurther the realization of our objectives, and then getting everyone at Yokohama Rubber working
together as one to put these ideas into practice. Both in our company and in society as a whole, it isimportant to “pass on the baton” to the next generation; over the past 12 years, we have been constantly
thinking about how we can pass on the baton in the best possible way.
In our CSR activities, rather than merely seeking to fulfil our corporate responsibilities to society, we
have adopted an approach that emphasizes building ourselves into a company that is trusted by society.
Instead of focusing only on short-term profitability, we have concentrated on earning the trust of a wide
range of different stakeholders. At the same time, I believe that maintaining a constant awareness of theimportance of Environmental, Social and corporate Governance (ESG), which has become a major
focus of attention in recent years, will help us to stay on the right path.
Today, as we look ahead to our company’s 100th anniversary, we need to start thinking in terms of whatsociety will look like in 2050, or 100 years from now. Regardless of how society changes, I firmly believe
that, if we continue to strive for steady, healthy growth, then we can be sure of keeping society’s trust.
As I see it, Yokohama Rubber’s biggest strength lies in our corporate culture, with its emphasis on
freedom. By making maximum use of our corporate culture, which encourages employees to think freely
for themselves and to make their views known, we can continue to respond effectively to the rapid paceof change in technology, and the rapidly changing social environment, which Industry 4.0 embodies. I
believe that, as we continue to respond to change, we need to aim at becoming a truly “global enterprise”
that is able to successfully develop localized business operations throughout the world.
To realize this vision, it is vitally important for all employees to demonstrate“thoughtfulness,” in terms of thinking not just about themselves, but about
how they can be of use to, and make a positive contribution towards, otherpeople and society as a whole. I sincerely hope that the new generation thatwill be carrying Yokohama Rubber into the future will approach their workwith this kind of “thoughtfulness.”

Tadanobu Nagumo
Chairman and Representative Member of the Board

02

Yokohama Rubber Group at a Glance (as of December 31, 2016)
Company NameThe Yokohama Rubber Co., Ltd.

Number of Employees

24,610 (consolidated)

Establishment

October 13,1917

Number of Shareholders

10,663Paid-in Capital

JPY 38,909 million

Net Sales

JPY 596,193 million (FY2016)

Number of Shares
Issued and Outstanding
Number of Consolidated
Subsidiaries

Fiscal Year End

December 31

Stock Exchange Listings

Tadanobu Nagumo

Our Worldwide Locations Japan, the USA, Canada, Australia, Germany,
the Philippines, Vietnam, China, Thailand,
Russia, etc.

Chairman and Representative
Member of the Board
President andRepresentative Director

Masataka Yamaishi (appointed in March 2017)36-11 Shimbashi 5-chome, Minato-ku, Tokyo
105-8685, Japan

Head Office

169,549,081
135
Tokyo and Nagoya

http://www.y-yokohama.com/global/

Website● Main Products

Yokohama Rubber Group at a Glance

Tires
Yokohama Rubber manufacturers a wide range of tires,tubes, aluminum foil andautomotive components forpassenger vehicles, trucks andbuses, light-duty trucks,
construction vehicles, andindustrial vehicles

MB*
Yokohama Rubber supplies conveyor belts, rubber
plates, various hoses, fenders, oil-spill containment
booms, marine hoses, rubber molded products, airsprings, highway joints, rubber support, waterproof
materials, water stopping materials, sound- andvibration-proof materials, adhesives, sealants, coatings,
encapsulants, and aerospace products.

O the rSporting goods,
information processing
services, real estateleasing, and others* The Alliance Tire Group product family* MB stands for Multiple Business. This term is collectively used by
Yokohama Rubber to refer to a diversified and growing business portfolio.

● The Main Regions Where Yokohama Rubber Is Developing Its International Operations (as of March 2017)

Tire production sites

Tire sales sites

MB production sites

MB sales sites● Net Sales (consolidated) andProfit Attributable to Owners of Parent

Net Sales

Profit Attributable to Owners of Parent

700
600
500

559.7
32.6

625.2
601.6
35.0

40.5

629.9
36.3

596.2

18.8

900

35

800

2013

2014

2015

2016

(FY)

37.5

44.1

47.7

903.0
38.6

734.5
653.6

710.7

50
40
30
25

400

20

300

15

10

200

10

5

100

5

0

0

2013

2014

2015

24,61025,00020,00019,412

19,7702012

2013

21,441 22,187

35

543.8

2012

(Persons)

45

500

15

2012

600

Equity Ratio
(%)

41.4

700

(consolidated)

Equity Ratio

Total Assets(JPY billion)

40

20

100

● Number of Employees(consolidated)

1,000

25

200

0

● Total Assets and Equity Ratio

45

30

400
300

Other

Total Assets

Profit Attributable to Owners of Parent(JPY billion)

Net sales(JPY billion)

03

ATG*
Production of a wide range ofdifferent types of tire for use
on agricultural machinery,industrial vehicles,
construction vehicles,
forestry machinery, etc.

2016 (FY)015,00010,000
5,000
0

2014

2015

2016 (FY)Corporate Philosophy (CSR Management Vision and Action Guidelines)

Corporate Philosophy (Launched in 1992)
Basic Philosophy
To enrich peopleʼs
lives and contribute to theirgreater happiness and well-being
by devoting our wholehearted
energies and advanced technology to thecreation of beneficial products.

Management Policies● Take on the challenge of new technologies to produce new value.
● Develop proprietary business fields to expand the scope of business.
● Create a workplace that values, improves and energizes people.
● Deal fairly with society and value harmony with the environment.

Action Guidelines

Corporate Slogan● Develop ourselves so that we may give our personal best.
● Trust, challenge and improve one another.

Excellence by nature● Nurture a welcoming, open spirit.

CSR Management Vision (Launched in 2008)
To build a trusted identity as a contributing member of the global community.
CSR Action Guidelines● Identify continually changing social trends.

● Act swiftly to earn affirm trust.

● Ascertain the items that can contribute.

● Practice CSR in one’s own work.

1. We shall respect human rights inside and outside the company
2. We shall create workplaces that are safe and healthy
3. We shall harmonize our activities with the global environment
4. We shall provide safe and high-quality products and services

5. We shall conduct corporate activities with a high transparency andpractice proper disclosure of information
6. We shall observe not only laws and regulations but also social norms
7. We shall aspire to harmony and prosperity with local communities

Grand Design 100 (GD100)
Medium-range Management Plan

Environmental GD100

GD100 Vision and Basic Policy

To mark the Yokohama Centennial in fiscal 2017,
we will evoke a distinctive global identity in building
corporate value and in building a strong market presence.

Long-Term Financial Targets (FY2017)

Net sales: ¥770 billion, operating income: ¥80 billion,
operating margin: 10.4%

Basic Policy

Deliver the best products at competitive prices and on time.
Assert world-class strengths in technologies for protecting the environment.
Foster a customer-oriented corporate culture that honors rigorous
standards of corporate ethics.

Corporate Philosophy

Yokohama Rubber Group Action Guidelines (Updated in 2014)

Basic Policy

Following the principle of dealing fairly with society andvaluing harmony with the environment,
we shall assert our world-class strengths in technologies forprotecting the environment.
● Continued improvement of environmental management.
● Action to combat global warming.
● Contributing to the creation of a sustainable recycling

society.

Updated in 2015

Established in 2006

The Founding Spirit
1. Production business is a social service. Its purpose is to make people’s lives more convenient and enjoyable. Its aim should
be to offer good, useful products at moderate prices.
2. There must be a basic commitment to delivering quality products unrivaled by those of competitors.
3. Management should adhere to the principles of fairness and consideration. The mission of a fair, honest management is toensure capital, share the fruits of endeavor with its workers, and fulfill its responsibilities to consumers to act, in otherwords, rationally.
4. A company should have as few employees as possible and make the best use of the productivity of machines. This is thegreat secret for improving efficiency.
5. The success or failure of a business depends on how much one is willing to study, and with how much determination, tomutually improve and grow. Accordingly, one must make a great effort.

04

Message from the President

Building on the foundation
was founded
Aiming to continue to be a

Message from the President

Reaching the milestone ofour 100th anniversary while facing a rapidlychanging business environment
Recently, the business environment in which Yokohama Rubber
operates has been undergoing dramatic changes. Besides theincreased uncertainty in the economic and political spheres, andin international relations, the rapid development of autonomous
driving technology and of the Internet of Things (IoT), as well as
the increasingly widespread adoption of electric vehicles, hascreated a situation where the automotive industry is undergoinga transformation of the kind that normally only occurs once
every few decades. Having been appointed President of
Yokohama Rubber in March 2017, I am deeply aware of theheavy responsibility that I now bear to steer the Yokohama
Rubber Group, an organization that comprises around 25,000
people, through these challenging times.
Yokohama Rubber’s GD100 medium-range management plan,
which takes as its final year of implementation the year 2017 (theyear that marks the 100th anniversary of the founding of
Yokohama Rubber), was launched in fiscal 2006. At that time,
demand for our company’s tires and other products was
growing steadily throughout the world; anticipating that wewould be able to ride this wave of growth, we set ourselves thehigh targets of achieving annual sales of 1 trillion yen and annual
operating income of 100 billion yen. Afterwards, however, theworld has experienced a series of events that could not havebeen foreseen, including the Lehman collapse of 2008, the Great
East Japan Earthquake of 2011, the European Debt Crisis, etc. In
addition, the emergence of major new tire manufacturers inSouth Korea and China has led to the global market becoming
flooded with cheap tires, disrupting the supply-demandequilibrium. As a consequence, the company has been
operating within a very challenging business environment overthe past few years.
Despite the unexpectedly dramatic changes in the businessenvironment, because all of the companies in the Yokohama
Rubber Group have been moving in the same strategic direction
in a coordinated manner, I feel that the setting of high targets
over the medium-term timeframe still had a very positive
impact. Over the past few years, we have achieved steady
growth in the global OE (Original Equipment) segment, and oursponsorship agreement with Chelsea Football Club has helped
us to boost Yokohama Rubber’s global brand recognition. We
have also succeeded in expanding our industrial tires business,with the acquisition of Alliance Tire Group B.V. (ATG) in fiscal
2016 and of Aichi Tire Industry Co., Ltd. in fiscal 2017. As a result,despite the uncertain times in which we have found ourselves,
we have succeeded in maintaining steady growth in the global
market as a whole, and have made significant forward progress.

Remaining true to Yokohama Rubber’s corevalues, and realizing corporate social
responsibility from a broad perspective
In order to maintain our status as a business enterprise that is felt05

of trust over the first 100 years since our company
company indispensable to society over the next 100 years
Striving for continued growth,and focusing on the development of diverse
human talent around the world
To remain competitive in an era of revolutionary changes, bothbusiness innovation and technology innovation are vitally
important. Without question, the single most important driver ofinnovation is the diverse human resources that underpin ourGroup’s operations. At our Japan-based facilities, we are working
actively to promote women’s advancement and participation.
Nearly 40% of the new employees that have joined the company
in fiscal 2017 are women, and we view the creation of aworkplace environment in which outstanding female employees
can maximize their potential as a top priority.
In addition, as part of our efforts to take the global expansionof our business operations at step further, we are proactively
recruiting local talent, and cultivating the local managers towhom we can entrust the running of our business sites incountries throughout the world. Japanese-style business
management cannot be applied in a "one size fits all" waythroughout the world; while ensuring that the human talent thatplays such a key role in our overseas operations has an in-depth
understanding of the Yokohama Rubber corporate philosophy
and of the policies that we seek to adhere to, we also need togive them the latitude to develop business operations in waysthat reflect local culture and the unique features of local society.
In the future, I hope that we will see some of these
locally-recruited managers making an important contribution on
the board of directors of our company.
When undertaking human talent cultivation, I believe that aneffective approach is to set targets that are slightly higher thanwhat each individual might currently think they are capable ofachieving, and to gradually entrust them with more and more
responsibility. The individual employee learns to make decisions
for himself or herself, determine what steps need to be taken,
take responsibility for the outcome, and accept assessment of
his or her performance. This can be very challenging, but
younger employees really do need to build up experience in thisway.
We need to treasure the "Yokohama Rubber core values" thathave been built up by so many employees over the 100 years of
our company’s history, and work to enhance them still further.
By working together as one, we can take on the challenge of
dealing with the changes that the next 100 years will bring.

Message from the President

to be irreplaceable, both by our customers and by society as awhole, as we approach our 100th anniversary, we need to think
seriously about the next 100 years. We are currently formulating
our next medium-term strategy, focused on what we want toachieve by fiscal 2020.
To ensure the continued growth of Yokohama Rubber intoday’s constantly changing automotive sector, it is vitally
important to spread awareness of our company’s tires among
the customers of leading global automotive manufacturers inJapan, Europe, North America and China, etc., ensuring that the
Yokohama Rubber brand becomes more widely known. One
area where our company is particularly strong is in relation to
the superior environmental performance of our tires. Making
effective use of our unique technology that combines low rolling
resistance with improved wet-weather performance (twoattributes that in the past have usually been mutually exclusive),
we are expanding our presence in the premium car market,
where the emphasis is on speed and comfort.
CSR, which includes not only measures to addressenvironmental problems but also compliance and quality
enhancement initiatives, is an area that needs to be an integral
part of our day-to-day operations in order to realize continued
growth for our company. Companies that are weak in CSR
cannot win the trust of society; a single mistake in CSR can befatal, even for a firm with a history going back 100 years.
The impact of our corporate activities is felt far and wide, andwe need to take account of the impact on the regions in which
we operate, and on our suppliers. It is not enough just to look at
how things are now; we need to build solid foundations thatlook ahead to the situation several decades from now, when thepeople currently joining our company as new employees will beapproaching retirement.
We attach great importance to initiatives aimed at tackling
major international challenges, such as the Sustainable
Development Goals (SDGs) adopted by the United Nations in2015. The 17 objectives enunciated by the SDGs each represent
new business opportunities for our company. Yokohama
Rubber’s manages have an important role to play in formulating
strategies that recognize this importance and that reflect theconnections between the SDGs and our company’s business
operations, and in encouraging every individual employee toparticipate fully in implementing these strategies.
Yokohama Rubber has been described as "a serious-minded
company run by good people." Environmental activities such as
the Yokohama Forever Forest initiative, launched in fiscal 2007
with the goal of planting 500,000 trees, are a reflection of thekind of company we are. Every individual tree is being carefully
cultivated by us from a seedling until it is fully grown. A
company that is willing to continue making this type of effort,
working away steadily year after year, is a company with acorporate culture that it can be proud of, and which can be
maintained over the next 100 years.

Masataka Yamaishi
President and Representative Member of the Board

06

Yokohama Rubber’s
100 Year History of Staying
Ahead of Society
1917 to 1999

1917 to 1937

Foundation to prewar growth period
Established with aspirations of producing some of the finest
products in the world

100 Year History of Staying Ahead of Society

Operating based on afounding spirit that values
economic efficiency andsocial qualities.

Hiranuma Plant

1938 to 1950s

From military demand, expansion,and defeat to reconstruction
Business driven by military demand/overseas production andreconstruction from postwar

Promptly developed
environmentally friendly
products while resuming
business following
hardships.

Head Office and Tokyo Branch Office

Developments at Yokohama Rubber
1917

Yokohama Rubber Co., Ltd. was established on October 13 as a
joint venture between the BF Goodrich Company and Yokohama
Electric Cable Manufacturing Company.
Has the ambition to produce the best rubber products in the world using theadvanced technology of the US.

1920
1923

Started tire production
Hiranuma Plant was completely destroyed by the Great Kanto
Earthquake
Worked to rebuild the plant while importing and selling tires from the BF
Goodrich Company.

1929

Started operations of the Yokohama Plant completed in
Tsurumi-ku, Yokohama
The speech at that time by President Suekichi Nakagawa adopted as thefounding spirit.
1. Production business is a social service.
2. Commit to delivering quality products unrivaled by thoseof competitors.
Founding spirit 3. Management should adhere to the principles of fairness(summary)and consideration.
4. Making the best use of the productivity of machines is thegreat secret for improving efficiency.
5. Make a great effort to succeed in business.

1938
to
1944

Established production sites in Asian countries

1944

Opening of Mie Plant

1945

Yokohama Plant rendered inoperative by Allied air raids

1946

Got a fresh start based on a dauntless spirit
Started operations at Mishima Plant

1951

Started operations at Hiratsuka Plant

1940

Started sales of recycled rubber

1952

Launched Japan’s first cord conveyor belts

1954

Launched the "Y-29", Japan’s first snow tire

1958

Launched HAMATITE® sealant made from a rubber and resin
compoundof( endwar ) Lost all the business sites in Japan and overseas

Representative products
1921

Independent development and utility model registration of acut-edge flat belt
Developed Japan’s first corded tire, the "Hama Town Cord"
Extended the life of tires by three times

1929

Started domestic production of V-belt
Revolutionized the V-belt industry with high-speed operation, long life, andexcellent acoustics

1937

Launched a Y-shaped tire that adopts a new tire cord
Improved durability, etc.

Aimed for the domestic production of construction sealant, which passed
stringent durability testing and has been used in many high-rise buildings.

Developed a pneumatic fender as the Company’s first environmental contribution productPreviously, whales had been used as cushioning material for whaling ships
coming alongside the pier, which were substituted by this fender.

07

Reflecting on Yokohama Rubber’s History and CSR

Yokohama Rubber will celebrate its 100th anniversary since foundation in 2017. Over this period of
100 years, we have overcome various difficulties and worked as a company to develop productsahead of the world.
We will introduce the values Yokohama Rubber has continued to provide to society along with ourenvironmental and CSR activities.

1960s to 1970s

1980s to 1990s

High growth period
Taking on our social responsibility as quickly as possible

From the bubble economy to a periodof low economic growth
Pioneering environmental support

As pollution had become asocial issue and in anticipation of the times, we indicated a stance of consideration
for not only our own company, but also the supply chain
and the local community.

1970

Renamed to The Yokohama Rubber Co., Ltd.
Pollution Prevention Committee establishedBecame the Environmental Improvement Department the following year.

1972
1973

Established Tokyo Retread Co., Ltd. and started a retreadingbusiness
Formulated a new management philosophy
Aim to put an emphasis on corporate social responsibility. Around this time, we
indicated that we would not generate pollution even at the stages of subcontractors, raw materials suppliers, and customers.

1974

Started operations at Onomichi Plant
Equipped with a full factory wastewater closed system.

1977

Occurrence of some defects in car steel radial tires and subsequentannouncement

1983

Entered the PRGR (ProGear) golf business

1992

Formulated the corporate philosophy

1992

Mie Plant completes a tire incineration boiler using waste heat inconsideration of the environment

1993

Formulated environmental protection action plan

1996
to
1997

Established production andsales subsidiaries in thePhilippines, Thailand,
and Vietnam

1999

Acquired ISO 14001 for all
plants in Japan1980

Launched sales of "ASPEC AX-323", a Kevlar radial tire forpassenger cars

Started withdrawal and replacement measures. Made prompt response efforts
including inspections.
Planned and executed recurrence prevention measures.

1964

Japan’s first spiral high pressure hose released"DNA", the first eco-tires in Japan

Supports the adoption of hydraulics for industry machinery.

1965

Manufacturing and sales of the first jet aircraft tires in Japan1983

Launched sales of golf balls

1967

Launched sales of "G.T. Special" and "G.T. Special XX", radial tires
for passenger cars

1988

Launched sales of low-permeability air hose with one-tenth thealternative freon R134a permeability of traditional products

1990

Launched sales of "SY101", a studless tire for trucks and buses

Radial tires with doubled durability of bias tires up until now became
mainstream.

1971

Launched sales of "G.T. Special Steel",
Japan’s first steel radial tubeless tire for passenger cars

1991

Launched sales of "Flex Line", a cylindrical conveyor belt thatprevent scattering of the transported object

1976

Started development of fuel-efficient tires for North America

1998

Launched sales of "ES-01" and "ES-02" as first offerings of new
fuel-efficient "DNA" series of passenger car tires in Japan1978

Launched sales of "ADVAN HF" for passenger cars

100 Year History of Staying Ahead of Society

1963

Onomichi Plant

Launched sales of the"DNA" series as the firsteco-tires in Japan, staying
ahead of the global low
fuel consumption trend.

The rolling resistance used for indicating fuel economy at this time is regarded asa benchmark for tire fuel economy now.

08

Yokohama Rubber’s
100 Year History of Staying
Ahead of Society
2000 to 20172000s

Evolution of
CSR management
Becoming a company having world-classstrengths in technologies for protecting theenvironment.

100 Year History of Staying Ahead of Society

We have implemented various initiatives as a company having world-classstrengths in technologies for protecting
the environment based on GD100 and
the Environmental GD100.

Logo for GD100

Developments at Yokohama Rubber
2001

Started a zero emissions campaign

2006

Aim to stop producing industrial wastes for landfills by end of fiscal 2005

Announced new medium-range management plan, Grand Design
100 (GD 100)At the same time, set out on a policy of being a company having world-classstrengths in technologies for protecting the environment

2001
to
2004

2003

Established production and sales
subsidiaries in China (Shandong,Suzhou)Established production and sales
subsidiaries in China and Thailand
2007

Started the YOKOHAMA ForeverForest tree-planting project
We create forests in consideration of
biodiversity at offices in various locations.

Completed construction of
Shinshiro-Minami Plant in Aichi
Prefecture

Established a local subsidiary in India, Yokohama India Pvt. Ltd.
2008

Established a Corporate Social Responsibility Division
Released the CSR Management Vision of "To build a trusted identity as acontributing member of the global community."

2005

Established a tire sales company in Russia, Yokohama Russia L.L.C

2010

Formulated Guidelines on Biodiversity

2007

Launched sales of "ZEN 102ZE", a fuel-efficient, low maintenancetire for trucks and buses

Representative products
2000

Began sales of prepreg for aircraft structures
Achieved a significant reduction in weight compared to conventional metal
structure materials and contributed to improved fuel economy.

2001

09

Launched sales of "ECU-193" wood-based flooring material elastic
adhesive as a sick house countermeasure

2002

Launched sales of "iceGUARD iG10" studless tires for passenger
vehicles2003

ISO certification acquired for Yokohama Rubber’s pneumatic
fenders
Launched sales of "Ecotex", an energy efficient conveyor belt

2005

ADVAN become a global flagship brandLaunched worldwide sales of "ADVAN Sport V103"
Launched sales of the "AIR Watch" tire pressure monitoring systemfor passenger cars

2009

Launched sales of "Y-coat", a coating material used in household
appliances and electronic devices

Contributed to improved durability for information home electronic products
such as mobile phones.

2010

Launched sales of "BluEarth AE-01", afuel-efficient tire for passenger cars, as thefirst offering in the "BluEarth" series

Reflecting on Yokohama Rubber’s History and CSR

We would like to introduce our efforts to expand CSR management and environmentally friendly
products that we have particularly focused on since 2001.
We will implement world-pioneering business and social initiatives in preparation for the next 100
years for Yokohama Rubber.

2010s

Further progress ofglobalization and expansion ofsocial activities
In preparation for the next generation of society

Evolution of social activities aimed at thenext 100 years
Acquired Alliance Tire Group
into a subsidiary

Established Yokohama Peer Support Co., Ltd., as a company
promoting employment of disabled individuals

2016

Certified for top-ranking A List in the
CDP Climate Change Report 2016

Started environmental protection
project in the Laojunshan
Preservation Area in China
2012

Received integrated ISO 14001
certification (China)

2017

2015

Acquired Aichi Tire Industry Co., Ltd.
Achieved the goal of planting 500,000
trees in the YOKOHAMA ForeverForest Project

Signed the United Nations Global
Compact
2014

Acquired Alliance Tire Group B.V.

100 Year History of Staying Ahead of Society

2011

Indonesia Plant (marine products manufacturing)

Introduced a regional comprehensive work position system, andabolished general position system
Held social contribution activities awards for business partners
Awards were based on the result of self-diagnosis and questionnaires previously
conducted with business partners

2012

Launched sales of "Duotex", along-life conveyor belt composedof recycled materials

2016

Launched sales of the "ibar
HG82" hose for high-pressurehydrogen gas
Contributed to the spread of fuel cellvehicles and hydrogen stations.

2017
2015

Launched sales of the "AC6B 11"
air conditioning hose, the first in
the world to support next-generation refrigerant

Expected to achieve goal of
100% environmentally-friendly
products

10

Development of Products andServices that Contribute to theEnvironment and Society
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Development of Products and Services thatContribute to the Environment and Societylopursue techno
We continue tofety and peace of mind.
and lead to sa

Product 01

ADVAN Series"ADVAN Sport V105""ADVAN FLEVA V701"
High-performance sporty tires
We offer enjoyable handling and high driving
performance on wet surfaces so that many people
can enjoy comfort even at high speeds.

Tire products
We offer products that enrich
the lives of customers
while responding to thesocial needs.

BluEarth Series"BluEarth RV-02"

Product 03

Product 02

Acquired the highest gradeof "a" for wet grip
performanceThis tire for minivans andcrossover SUVs you use todrive around your precious
family members and cargoachieves both fuel efficiency
and safe driving during rainy
weather.

iceGUARD Series"iceGUARD 6"
The masterpiece of Yokohama’s studless tires"iceGUARD 6" added good performance in wet conditions
and superior noise reduction to the existing key strengths of
the iceGUARD brand (first-class performance on icy roads,
long-lasting high performance, and improved fuel economy)
to achieve even further safety on winter roads.
To P. 25

Product 05
Product 04

Retread tires

Up until now:

New
tires

Use

Disposal

From now on:
New
tires

Retread
tires

Use

Use

Disposal

Retread tires are tires thathave been reused throughre-adherence of tread rubberthat has worn off to restore
function as a tire. By reusing
resources we contribute to
the reduction of CO2
emissions in tire production
as well as a reduction in
waste tires.

Internet release of "Rainy Day Hill"
We have made an appeal for the excellent wet
performance of Yokohama’s tires through this original
short movie in an effort to improve recognition.

11

Reflecting on Yokohama Rubber’s History and CSR

Technology 01
Biomass materials

Development of and cooperation
between technical bases
We have developed regional development bases
near markets including Japan, North America,
Thailand, and Europe as a structure capable ofsupporting the requirements of each region.
To P. 28

"AIRTEX" low air permeability material
This low air permeability liner that is applied
inside tires significantly reduces tire air leaks andcontributes to improved fuel efficiency for tires
and resource conservation.

Technology
development

We are developing technologies forthe generation of raw materials forsynthetic rubber including
butadiene and isoprene frombiomass. We can reduce CO2
emissions to one-fourth of previous
levels through the development ofthese technologies.

We utilize advanced technologies
and materials technologies in
response to the requirements ofcustomers and society todevelop a global R&D
structure covering various
use conditions.

Technology 02
Image of synthesis of synthetic rubber (butadiene rubber) with biomass as a raw material
Synthesis of butadiene in ahighly efficient manner
through individual catalysts
from cellulose that is biomass

Individual
catalysts

Butadiene

Currently: Produced
industrially as a byproduct ofoil refining

Butadiene
rubberSynthetic
rubberTechnology 04

Tire simulation technologies

Technology 03

To P. 34

Technology 05

World’s first 3D analysis technologies(Adhesion deterioration assessment)
In partnership with Tohoku University and Hitachi
High-Technologies Corporation, we have developed
technologies for the three-dimensional analysis ofrubber and steel cord adhesion deterioration. These
technologies are expected to be applied to thedevelopment of tires with high durability.
To P. 34

Promoting motor sports activities
We promote and support various motor
sports as opportunities to experience thejoy of driving.
We will leverage the design, manufacturing, and assessment technology andknow-how developed in these activities inthe development of future projects.

Service & Business 02

To P. 25

Service & Business 01
Expansion of production goods
tire businessWe have expanded our business of tires for
agricultural, forestry, and industrial
applications through the acquisition of the
Alliance Tire Group (ATG) and Aichi Tire
Industry Co., Ltd. and partnerships.

Development of Products and Services thatContribute to the Environment and Society

Super computers, numericalsimulations, and data science are used
to clarify the impact that the variety ofdesign factors of tires and rubber canhave on various characteristics tofacilitate the development of
next-generation tires.

Serviceandbusiness development
We have a technology, service, andsales structure in place that allows us
to quickly respond to various needs.
Recently, we have also focused on
the expansion of industrial
application products andsales channels throughM&As.

Service & Business 03

To P. 27

Sponsorship agreement with Chelsea FC and social contribution activities
We have entered a sponsorship agreement with a Premier League football club to help
improve recognition of our company and our brand image. We also conduct social contribution activities, including a football school and tire safety awareness activities.
To P. 2412

Development of Products andServices that Contribute to theEnvironment and Society
MB businessves of
i
l
e
h
t
r
o
f
t
r
o
supp
g
n
i
k
c
a
b
e
d
i
v
cts
u
d
o
r
p
We pro
s
s
e
n
i
s
B bu
M
h
g
u
o
r
h
t
e
l
peop
"Versatran" high pressure hose

Development of Products and Services thatContribute to the Environment and Society

Product 01

High pressure hoses are essential for a wide
variety of industrial equipment such as
construction machinery and machine tools.
The hoses have the characteristic of improving
flexibility through the optimization ofmaterials and keeping the bending radius to aminimum.
We plan to develop a lineup of spiral hose
products that prioritize high pressure, highdurability, quality, and performance, and tostrengthen the overseas sales of high pressure
hoses with a focus on the mid-range andabove market overseas.

MB products
We offer a variety of productsthat support social
infrastructure.

Product 03
Product 02"AC6B 11" next-generation refrigerant hoseThis is an air conditioning refrigerant hose that
supports HFO-1234yf that has a low global warming
coefficient. We succeeded in improving coolant
resistance through patented plastic materials.
To P. 22

Resin tailgate adhesives
Resin tailgate adhesives were developed throughrevolutionary primer-less technologies, and havecontributed to a reduction in car body weight. As
fuel efficiency is improved, they contribute to both
the global environment and fuel cost reductions.

Product 04
Marine hose and pneumatic fender
Yokohama Rubber has a global top class market
share for pneumatic fenders and marine hoses,
widely used in marine transport operations for
crude oil, etc.
Since oil leaks can lead to major marine pollution,high reliability and durability have been essential forthese products. In recent years, we have further
improved the safety by introducing to the market
our double carcass hoses with an oil leak detection
feature.
To P. 26

13

Reflecting on Yokohama Rubber’s History and CSR

Silicon encapsulating materials for LED
Technology 01

We have developed highly durable silicon encapsulating materials for high-brightness LED lighting,which have been applied in many areas close to daily
life including offices and shopping malls.
In addition, UV-resistance silicon encapsulating
materials, developed through proprietary technologies for UV-LED that demand has grown for recently,
have been adopted and applied in various fields,
including sensors and cosmetics.

Technology 02

Technology
development
We conduct various forms of
R&D in pioneering technologies
and materials development to
respond to the needs ofcustomers, and technology
development to support
next-generation social
infrastructure.

High-pressure hydrogen gas hoses"ibar HG82"
We have achieved lightness, flexibility, andalso durability through a hybrid structure ofpatented fiber and steel wire. We are also
actively engaged in the development of
hoses to support the 87.5 MPa international
standards.

Development of Products and Services thatContribute to the Environment and Society

Technology 03"Tuftex α" conveyor belt
By carrying out a number of field trials, using aproprietary evaluation criteria, and making
fine adjustments at the compound level, wewere able to develop "Tuftex α" with anabrasion resistance of 64% better than our
existing Ultra Wear Resistant (UWR) covercompound.

Service & Business 01

Business Partners
Liaison Council
We endeavor to stably
provide high-quality products
by creating strong trust
relationships with business
partners.
To P. 29

Serviceandbusiness development
We have put in place global
production, supply, and sales
structure, and we also conduct
activities aimed at improvements in terms of quality,
technologies, andservices.

Service & Business 02

Expansion of global production andsales structure
During the GD100 period, we have establishedsales and production bases in China(Shandong/Hangzhou), Italy, and Indonesia; sales
bases in China (Shanghai), Singapore, and Europe(Dusseldorf); and a production base in Mexico inorder to strengthen our global production andsales structure.

14

YOKOHAMA
Forever Forest Project—Spreading greenery for smiling faces —Activities have spread over a period of eleven years since the start of the Project
YOKOHAMA Forever Forest Project that started from fiscal 2007 is a
project for planting 500,000 seedlings at business locations in Japanand overseas by fiscal 2017 that mark Yokohama Rubber’s 100th
anniversary, based on our Environmental GD100 slogan of "we will
become a company having world-class strengths in technologies forprotecting the environment". Based on stance of potential naturalvegetation, we plant the species native to that region. In addition,
through tree planting we conduct green environmental regenera-tion activities that protect life in the regional environment and local
communities through means such as raising the environmental
awareness of participants, creating fire prevention programs andforests to preserve the environment, contributing to global warming
prevention, maintaining biodiversity, and improving communication
with the local community. The activities of this period of elevenyears have spread significantly in aspects including ties between
various people and contributions to the environment.

History of 500,000 trees and the fixed quantity of CO2 absorption

500,000
trees achieved!

(Estimated based on measurements at the Hiratsuka Factory)(No. of trees)

500,000

YOKOHAMA Forever Forest Project

400,000
285,413300,000
200,000
100,000
0

134,558
27,000
2007

4.6

19.1

52.5

2008

2009

2010

2011

452,591

799.3

659.7
525.7

232,090109.7

414,697

2012

800
600

399.6
189.5

(Tons)
1,000

400

287.6

200
2013

2014

2015

2016

2017

0
(FY)

China

We have conducted tree planting activities
every year since 2014. We also participate inregional tree planting activities when we havethe opportunity and value our relationshipwith the local community. In March 2016, we
also participated in tree planting activities
held near the Qiantang River that flows
through the city of Hangzhou, and donatedseedlings that we had nurtured in our plantpremises. These types of YOKOHAMA ForeverZhangyon Huan
Forest Project activities have been noticed by
Safety andthe local community and were introduced in
Environmental Section Manager
an event as public welfare activities in
Yokohama Industrial
Products – Hangzhou Co., Ltd.
November 2016. In March 2017, employees(YIPHZ )provided guidance on tree planting at a tree
planting event held at an elementary school in
the Xiasha District of the city of Hangzhou.

India

Pradeep Baswana
Joint Manager , EHS
Yokohama India Pvt. Ltd. (YIN)

15

79,381

183,060

325,706

369,150

500,000

At the first tree planting event conducted in
February 2016, 24 species of 2,159 tree
seedlings were planted in the plant premises,with the participation of personnel from
Embassy of Japan, state government,
representatives from other related companies
and school children. The trees grew about 3 mtall after one year, as the tree planted areagrew into green area many birds and insects
started to come. In February 2017, 24 speciesof 1,740 tree seedlings were planted at thesecond tree planting event. Our employees
take pride in their contributions as part of CSR
activities and biodiversity conservation
activities. We are planning tree planting in
Kasar Village as our next CSR activity including
village personnel.

Shinshiro

Masaru Naito
Meister, Shinshiro Plant

Currently, approximately 70,000 seedlings are
growing at the Shinshiro Plant. Seedlings arecontributed to nursery schools, kindergartens,
elementary schools, social welfare
corporations, and other organizations to assist
with local reforestation. At the Shinshiro City
Johoku Nursery School, as activities to protect
the lives of trees when trees were felled at the
local Tominaga Shrine accompanying therelocation of the school building, we
supported the raising and planting of
seedlings from acorns from the trees thatwere felled. In addition, we conducted tree
planting activities together with the NPO
Donguri Mongori, Parks and Green Spaces
Division and Natural Environment Division in
Aichi Prefecture, and local children.

Reflecting on Yokohama Rubber’s History and CSR

Ongoing support for disaster areas leveraging the know-how of the
YOKOHAMA Forever Forest Project"Green Tide Embankment" in Otsuchi-cho, Iwate Prefecture
We support the "Green Tide Embankment" Project that is part of thereconstruction plan concept set forth by Otsuchi-cho that focuses on
creating a beautiful town with unique paths with a view of the sea
that make you want to walk, and as part of these efforts we
supported the creation of a forest that will serve as a model case.
The "Green Tide Embankment" is an idea conceived by the plant
ecologist Dr. Akira Miyawaki, who has provided guidance for the
YOKOHAMA Forever Forest Project.
The Miyawaki method is a unique method for growing trees closely
together in a state near to a natural forest by planting native species
and raising many types of seedlings. On April 30, 2012, a mound(embankment) utilizing earthquake rubble was formed for a lengthof 50 m along the Kozuchi River that flows through Otsuchi-cho.
Starting with the first tree planting event, a mound of approximately
250 meters long was forested by 2015. These activities have been

Hiratsuka

carried on in a tree planting course in the "Furusato (Hometown)
Course" of Otsuchi Gakuen that is operated by the town of Otsuchi.
Debris from the Great East Japan Earthquake are buried inside of themounds where these trees are planted. We believe these activities
not only constitute theeffective utilization of debris
that are full of the memories
of people who underwent adisaster, but that they will
also help prevent disasters in
the future.

Fumina Suzuki
We started bird watching from September 2008 in order to understand the effects of the YOKOHAMA Forever Forest Project on theecosystem. We have held monthly bird watching events 106 times as of June 2017 while receiving guidance from the Komatan bird
watching group, and we have observed 55 species of birds in the process. We have felt the connection between birds and the
YOKOHAMA Forever Forest while keeping records that include the forest being used by migrating birds including the eastern crowned
warbler and nests built of trees that were planted by birds such as the white-eye. We will continue bird watching in the future as well.

North
America

We planted 2,300 seedlings during the first tree
planting event in 2009. We have plans tocomplete the planting of a total of 13,000 trees
in 2017. A YOKOHAMA Forever Forest that
contributes to the habitat of living creatures
has been formed at the plant, and the breedingof mammals such as deer and red fox and theeastern bluebird that is an endangered species
has been observed at this forest. In addition,
we are confident that the positive effects of thisChristian Yates
YOKOHAMA Forever Forest that include
Senior Environmental Specialist, contributions to biodiversity, the absorption of
Yokohama Tire Manufacturing
CO2, and controlling surface water and soil
Virginia, LLC (YTMV)
erosion to assist penetration to groundwater
will lead to trust from the community
surrounding the plant.

Vietnam

We have also planted a total of 2,235 trees
in tree planting activities at eightelementary schools in the neighborhood
outside of the plant. According to Principle
Nguyen Anh Hong, "As the students areproud of the trees they have planted, andthey bring along their friends and family totell them which tree they planted, I thinkthese activities are also good for raising
Nguyen Thanh Duy Sinh (left) their awareness of environmental
protection." It also makes us happy to see
General Affairs Section Manager
children play under the shadows of trees
Huynh Thi Thu Ai (right) they have grown, and we take pride in thefact that we have also contributed to an
Environment Section Manager,
Yokohama Tyre Vietnam Inc. (YTVI) improvement in the awareness of people in
the local community towards climatechange and the environment.

ThailandNittaya Suna
Environment Supervisor,
Safety and Environment Section,
Yokohama Tire Manufacturing(Thailand) Co., Ltd. (YTMT)YOKOHAMA Forever Forest Project

Environmental Protection Promotion Department,
Hiratsuka Factory

We started tree planting activities in 2008
under the guidance of Dr. Shirin of the Thai
Royal Household Bureau. We expect toachieve the planting of approximately 81,000
trees in 2017, which is 161% of the tree
planting target of 50,000 trees. We have also
conducted bird and insect monitoring
surveys within the plant premises since 2013.
Furthermore, from 2015 we started creating abiotope, and held information sharing events
for stakeholders including local residents,
local municipalities, and elementary schools.

16

The Future of
Yokohama Rubber and CSR
CSR and Important Issues (Materiality)
Yokohama Rubber Group is committed to the ten principles of the UN Global Compact*1 and carries out the Plan-Do-Check-Act (PDCA) cycle
following the framework of ISO 26000*2.
*1: A voluntary initiative in which companies participate in a worldwide framework for realizing a sustainable society by taking action as a good corporate citizen through creative and responsible
leadership.
*2: A set of guidelines created by the International Standards Organization (ISO) on the social responsibilities of companies and other organizations.

The Ten Principles of the UN Global Compact

ISO 26000 Seven Core Subjects• Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights; and• Principle 2: make sure that they are not complicit in human rights abuses.

1 Organizational governanceLabour2 Human rights

Human Rights• Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right tocollective bargaining;• Principle 4: the elimination of all forms of forced and compulsory labour;• Principle 5: the effective abolition of child labour; and• Principle 6: the elimination of discrimination in respect of employment
and occupation.

CSR and Important Issues (Materiality)

Environment• Principle 7: Businesses should support a precautionary approach toenvironmental challenges;• Principle 8: undertake initiatives to promote greater environmental
responsibility; and• Principle 9: encourage the development and diffusion ofenvironmentally friendly technologies.

4 The environment
5 Fair operating practices
6 Consumer issues
7 Community involvementand development

Anti-Corruption• Principle 10: Businesses should work against corruption in all its
forms, including extortion and bribery.

Determining Important Issues (Materiality)
In 2014 we determined important issues (materiality) with regards to themes of great interest to and impacts on both the company andstakeholders, from among the many CSR issues that exist.
We focus on specific items among these and establish KPI as we work towards ongoing improvements by implementing the PDCA cycle toachieve these items.

The global
environment

We challenge to build a sustainable society in harmony
with the environment, to protect our blue planet andhuman beings.

Materials
EnergyWater
Biodiversity
Emissions
Products and services
Environmental grievance mechanisms

Local communities

We build a trusted identity as a contributing member ofthe global community by making contributions to thedevelopment and prosperity of local communities.

Market presence
Local communities
Grievance mechanisms for impacts on society

Customers

We supply safe and secure products throughmanufacturing focused on our passion and technology.

Customer health and safety
Product and service labelingMarketing communications
Compliance (Product liability)

Shareholders/investors

We improve our company value by growing business
opportunities.

Economic performance

We promote CSR activities throughout the value chain.

Supplier human rights assessment
Supplier assessment for impacts on society
Supplier environmental assessment
Supplier assessment for labor practices
Child labor
Forced or compulsory labor

We value and develop our people, and create
opportunities for people.

Occupational health and safety
Training and education
Diversity and equal opportunities
Human rights grievance mechanisms

Business partners

Employees*Please see page 21 for specific initiatives for stakeholders in terms of value creation through our businesses.

17

3 Labor practices

Participation in initiatives in Japan and overseas
Japan Association for the World Food Programme
We endorse the World Food Programme (WFP) in undertaking toeradicate hunger and poverty and support the activities of the WFP
as a trustee.

WBCSD (World Business Council for Sustainable
Development)
WBCSD refers to the united association consists of top executives
from global corporations in order to perform their leadership in theirindustry, have lively discussion, and propose policies with regards tothe environment and sustainable development. We are participatingin the Tire Industry Project which is to conduct surveys pertaining topossible impact on the environment and health to be made by tires,and to promote various activities to save energies in the buildings
and offices.

Biodiversity."
In addition, we participate in various activities for Keidanren’s
Commitment to a Low Carbon Society under the vision of "Japanesebusiness community to harness our technological prowess andassume an instrumental role in the drive to halve global GHG
emissions by the year 2050".

Sustainable development goals (SDGs) adopted by
the United Nations
We work to resolve important issues (materiality) as we conductbusiness activities that contribute to SDGs in order to achieve asustainable society.

Charter of Corporate Behavior of Keidanren

CSR and Environmental Management Promotion System
Twice a year, we hold a CSR Council chaired by the President and an Environmental Council chaired by the Head of Corporate Social
Responsibility Division, in order to plan and review CSR issues that Yokohama Rubber Group should be addressing. Matters that affectmanagement are reported to the Executive Committee for approval.

Representative Director

Tire Production Environmental Task Force
Head: Head of Tire Production Division

Initiatives/
CSR and Environmental Management Promotion System

We conduct business activities in accordance with the Charter ofCorporate Behavior in order to gain trust and empathy from society.
Furthermore, we have been in accordance with the idea of"Declaration of Biodiversity by Keidanren" and their promotion
partners since 2009 to develop various approaches for thepreservation of biodiversity. Basic policies and action guidelines
have been set forth as "Guidelines for the Preservation of

MB Production Environmental Task ForceManagement Meeting

Head: Officer , MB Production and Engineering

Head Office and Sales Subsidiary CSR &Environmental Task ForceCSR Council
Chairperson: President

Head: Head of Corporate Social Responsibility Division

Subsidiary Production Environmental Task Force

Corporate Compliance Committee

Chairperson: General Manager,
Head of Environmental Protection Promotion Department

Global Environmental Council

Environment Council
Central Labor Committee
Central Safety
and Health Committee
Central Disaster Prevention Council

Chairperson: Head of Corporate
Social Responsibility Division

Chairperson: Head of Corporate Social Responsibility Division

Chemical Substance Management Committee
Chair: Officer , MB Production and Engineering

3Rs Committee
Chair: Head of R&D Center

Global Warming Countermeasures Committee

Risk Management Committee
Personal Information Protection
Management Committee
Export Control Committee, etc.
Corporate Officer /Operating Departments

Chair: Head of Tire Production Division

Environmentally Friendly Product Committee
Chair: Head of Commercial Tire Division

Yokohama Forever Forest Committee
Chair: Head of Corporate Social Responsibility Division■ CSR and environmental management promotion framework (as of September 22, 2016)18

Creating Value through Our Businesses
GD100 Phase IV: All for growth

Creating Value through Our Businesses

Phase IV (2015 to 2017) is the culmination of
GD100 and is positioned as the phase for setting
the stage for progress in our company’s second
century and resolving issues that have arisen up
until now based on the theme of "All for
Growth—Open the way for the next 100 years bybringing together the potential of Yokohama
Rubber". We hope to bring together all forms ofgrowth in our business activities, including the
growth achieved in each phase, the growth of theGroup overall, and individual growth. Net sales of770 billion yen, operating income of 80 billion
yen, and an operating margin of 10.4% have been
set as the quantitative targets for 2017. Note that
due to subsequent changes in the environment,these figures were net sales of 660 billion yen,operating income of 50 billion yen, and an
operating margin of 7.6% in the report for thesecond quarter of fiscal 2017 (as of August 2017).

We will improve customer value and expand on a global scale in order to continue to be amanufacturer of tire and rubber products needed by customers for the next 100 years
Work together as an entire
company so that all behaviors
lead to an improvement incustomer satisfaction

Products that have apresence that feels like
Yokohama Rubber

Tire business strategy

Aggressive investments
utilizing a sound financial
position

MB business strategy
Company-wide strategy

Technology strategy

CSR initiatives

Yokohama Rubber’s stakeholders
The global environment

Local communities

Customers

Shareholders and investors

Business partners andsuppliers

Employees

Process used for identifying important issues
We identify important issues in relation to Yokohama Rubber’s stakeholders and determine which issues should be prioritized.

STEP 1

G4 gap analysis

STEP 2

Issues assigning
G4 gap analysis
priority

STEP 3

Assigning an external
perspective G4 gap
analysis priority

STEP 4

Deciding onimportant issues

Focus was placed upon the requirements of the fourth-generation GRI Sustainability Reporting
Guidelines (G4) with respect to information disclosure levels (CSR Report 2013). The current
situation was grasped vis-à-vis the content and processes of both responsive and unresponsive
items (conducted January 2014).
Analysis was conducted in accordance with Yokohama Rubber’s industries, business sectors andbusiness regions. After completion of this analysis, the G4 gap analysis priority was assigned
vis-à-vis those issues affecting Yokohama Rubber that were identified through discussions withrelated business units (conducted January–February, 2014).
Sample Evaluation
The "Supplier Environmental Assessment" Aspect: For Yokohama Rubber, a company thatprocures natural rubber as a raw material, there is the necessity to consider that hidden humanrights risks might exist within the upper reaches of supplier chains extending beyond its scope.
Moreover, if wide-ranging business activities conducted in numerous regions encompassing bothdeveloped and developing nations are considered, such risks might be easily exposed. Throughcoordination in-house with the parties responsible for such matters, "human rights risk" wasevaluated as being "a very important aspect" for Yokohama Rubber.
Interview research was conducted among five stakeholders. From the perspective of what each ofthese individuals considered to be important issues (material aspects), a gap analysis priority was
assigned based upon the research results (conducted February–March, 2014).
The views expressed by the stakeholders can be found on our website.
(http://www.y-yokohama.com/global/csr/outline/g4.html)

On the basis of the analysis of the degree of importance (internal and external), research, anddiscussions conducted in Steps 2 and 3, the selected important issues were decided on throughstage-by-stage discussions at CSR Council and Board of Directors meetings (This process was
implemented in October 2014).

We will strive for ongoing improvement by setting KPIs and implementing the PDCA cycle in relation to the selected important issues.

19

Yokohama Rubber’s

Important Issues
For the Global
Environment
We challenge to build a sustainable
society in harmony with the environment,
to protect our blue planet and humanbeings.
Organizational governance
The environment

Together with
Local Communities
We build a trusted identity as acontributing member of the global
community by making contributions to
the development and prosperity of local
communities.
Organizational governanceCommunity involvementand development

Together with
Our Customers
We supply safe and secure products
through manufacturing focused on our
passion and technology.
Organizational governanceConsumer issues

To Our Stakeholders
and Investors
We improve our company value by
growing business opportunities.
Organizational governance

Together with
Our Business Partners

We promote CSR activities throughout
the value chain.**The overall series of activities or stakeholders
providing or receiving products or services.

Organizational governance
Human rights

Labour practices

Fair operating practices

Together with
Our Employees
We value and develop our people, andcreate opportunities for people.
Organizational governance
Human rights
Labour practices*

These symbols correspond to the ISO 26000 framework outlined on pages 35 and 36.

20

For the Global
Environment

The tractor unit of an 18-wheeler tractor-trailer in the U.S
The rear axles are fitted with ultra-wide base (UWB) single tires

Yokohama Rubber’s Important Issues

Development of ultra-wide base (UWB) single tires that help alleviating
the environmental impact by large commercial vehicles

21

Since 2011, Yokohama Rubber has been rolling out ultra-wide base
(UWB) single tire products in the North American market that make apositive contribution towards improving the transport efficiency andfuel economy of large commercial vehicles such as buses, trucks andtanker trucks.
Conventionally, these types of large vehicles have been fitted withsets of dual tires (two tires positioned adjacent to each other) inorder to fully support the weight of the vehicle and its cargo or
passengers. Yokohama Rubber’s UWB single tires are nearly as wide
as two conventional tires, so just one of these tires can support theload of a large commercial vehicle that used to require two tires.
UWB tires have a very low aspect ratio.
Switching over to UWB single tires offers many benefits. For one
thing, the overall weight of the vehicle itself is reduced. In the case of
the eighteen-wheeler tractor-trailers that are the most common typeof long-distance truck in the U.S., using UWB single tires instead ofdual tires can reduce overall vehicle weight by around 200
kilograms.
A vehicle’s maximum load capacity is determined by the vehicle’s
shape and size; it cannot carry more than this maximum capacity. Bymaking the vehicle itself lighter, you can increase the size of the loadthat it can carry. A UWB single tire requires less space to install than aset of dual tires; this means that a vehicle equipped with UWB single
tires can not only carry heavier cargo, it can also carry cargo thatoccupies a larger volume of space.
Being able to carry more cargo at one time makes for improved
transport efficiency, which reduces transport costs and also
minimizes the impact on the environment. The use of UWB single
tires also reduces rolling resistance by around 10–12%, making it
possible to achieve significant improvements in fuel economy. All of
Yokohama Rubber’s UWB single tire products have received
SmartWay® certification, which is awarded under the U.S.
Environmental Protection Agency (EPA) SmartWay® program forevaluating products that make a contribution towards reducing theenvironmental burden of commercial transportation.
In addition, the amount of materials needed to manufacture one
UWB single tire is much smaller than the corresponding amount fora set of dual tires, so the adoption of UWB tires also helps to saveresources.
While UWB single tires do offer all of the benefits outlined above,
because the tire’s section width is greater in relation to its section
height, a very heavy load is placed on the tire belt, and conventionaltire construction methods cannot provide adequate performance. To
overcome this problem, Yokohama Rubber developed SPIRALOOP
tire belt structure technology, which optimizes materials, sizing,alignment and manufacturing processes. This patented technology
has made it possible for Yokohama Rubber to undertake mass
production of UWB single tires.
In the North American market, where long-distance roadtransportation is highly developed, UWB tires accounted for 3.9% of
the total demand for large commercial vehicle tires in 2016, and thisfigure is forecast to grow in the future. Currently, UWB single tires
account for just under 10% of Yokohama Rubber’s total tire
production; given that demand for this type of tire is expected toincrease in Japan as well in the future, Yokohama Rubber’s UWB tires
can be expected to start making inroads into the Japanese market
too.

The benefits of UWB single tires
Improved fuel economy

Light-weighting

Increased load-carrying spaceWe challenge to build a sustainable society in harmony
with the environment, to protect our blue planet
and human beings.
< Our Goals >To make all of our products environmentally friendly
To reduce the total amount of greenhouse gas (GHG) emissions (to 50% less than 2005 levels
across the value chain)
To promote the efficient use of water resources according to the characteristics of water risks
To develop biodiversity conservation activities at production sites

Ongoing improvement of air-conditioning hoses that support next-generation
air-conditioning refrigerant

VOICE

Yokohama Rubber has also developed an improved version of the newhose that enhances the durability of the hose two-fold. Additional
improvements include the adoption of softer resin to prevent vibrationfrom the compressor from being transmitted to the passenger
compartment, improvement of the high gas-permeability resistancelayer that prevents gasified refrigerant from escaping from the hose, etc.
By improving all three layers of the hose—the rubber layer, resin layer
and reinforcing layer—Yokohama Rubber has succeeded in enhancing
overall hose functionality across the board in line with users’
requirements. In the future, we will continue to undertake further R&D inthis area with the aim of meeting the differing needs of individualautomotive manufacturers and individual models with greater precision.

Main components of a car air-conditioning system

Yokohama Rubber’s Important Issues

A car’s air-conditioning system, which is an indispensable part of thevehicle, creates cold air using vaporization heat generated by acontinual cycle of alternating liquefaction and gasification (throughthe application of pressure) of refrigerant inside hoses located within
the air-conditioning system in the engine compartment.
In recent years, there has been a worldwide movement towards
tighter regulation of the types of refrigerant used in air-conditioning
systems, with the aim of helping to prevent global warming. Startingfrom 2017, it will be obligatory for all new cars sold within theEuropean Union to use air-conditioning refrigerant that has a Global
Warming Potential (GWP) of no more than 150. Similar regulations are
expected to be introduced in North America and Japan in the future.
Responding to this trend, Yokohama Rubber has launched the "AC6B
11" high-pressure hose, which is designed to support the
new-generation HFO-1234yf air-conditioning refrigerant to which car
manufacturers are starting to switch over. HFO-1234yf has a very low
GWP of just 4, compared to a GWP of 1,300 for traditional
air-conditioning refrigerants. However, when HFO-1234yf is used inconventional air-conditioning hoses under pressure, it can be
dangerous because it may lead to the release of acid that can cause
cracks to develop in the inner resin of the hose. The new "AC6B 11" hoseuses a new type of resin that has been specially developed by
Yokohama Rubber, and features improvements to the outer rubber layer
and to the fibers of the reinforcement layer, which successfully prevents
the problem with acid.

Compressor

Receiver-drier

Condenser

Cooling unit
Expansion valve
Evaporator

The manager who heads Yokohama Rubber’s UWB single tire
sales division

Yokohama Rubber’s ultra-wide base (UWB) single tires offer many benefits. Firstly, they reduce the overall
weight of the vehicle. This means that one UWB single tire can carry more load than a set of two standard
dual tires, which also makes for improved fuel economy.
In addition, because UWB single tires have a larger contact patch than conventional dual tires, they
provide the vehicle with enhanced running stability. Another major benefit of UWB single tires relates tomaintenance and pre-trip inspections. Because none of the tires are located behind other tires, checking
the air pressure and performing other inspections on UWB single tires is easier than it is with dual tires. The
biggest issue with UWB single tires is retreading; in regard to this issue, Yokohama Rubber leads the way inthe industry by producing UWB tires that are easier to retread than those of any other manufacturer.
Reflecting the confidence we have in our products, in the North American market we offer a six-year
unlimited retread guarantee.

Dan Funkhouser, Sr. Director of Commercial Sales, Yokohama Tire Corporation (North America)
22

Together with
Local Communities

Scholarship presentation ceremony

Yokohama Rubber’s Important Issues

Yokohama Rubber (China) Co., Ltd. awards scholarships to local students
Every year since fiscal 2009, Yokohama Rubber (China) Co., Ltd.
(which oversees all of Yokohama Rubber’s operations in China)presents "Yokohama Scholarships" to academically outstanding
students at Qingdao University of Science and Technology in
Qingdao City, Shandong Province. In fiscal 2016, nine students
received these scholarships.
Qingdao University of Science and Technology is a Key University*that is administered directly by Shandong Provincial Government,
and has a highly-regarded polymeric materials program.
The Yokohama Scholarships are awarded to students in their second,
third or fourth years at Qingdao University of Science andTechnology. There are three classes of scholarship: second-year
students receive between 1,500 and 6,000 Yuan, third-year students
receive between 2,000 and 8,000 Yuan, and fourth-year students
receive between 5,000 and 10,000 Yuan. Every year, scholarships
totaling at least 50,000 Yuan are awarded.
Yokohama Rubber (China) Co., Ltd. has implemented measures toensure that the company is run in harmony with the local community,
for example by proactively recruiting local talent, and by providing
sponsorship for a conservation project in the Laojunshan district of
Yunnan Province. The Yokohama Scholarships program forms a part of

VOICE

these activities. By providing financial support for outstanding local
students, this program helps to raise awareness of Yokohama Rubber
among people in the area, and the program is also expected to help
Yokohama Rubber (China) Co., Ltd. recruit talented graduates. Whilethe number of people recruited varies from year to year, in fiscal 2016
Yokohama Rubber (China) Co., Ltd. recruited a total of 37 local
inhabitants, including graduates of Qingdao University of Science andTechnology. While the number of scholarship recipients who
subsequently go on to join the company has so far been limited,
Yokohama Rubber is still proud to be able to make a contribution
towards the cultivation of human talent in the region.
By providing support for young people through community
contribution activities of this kind, Yokohama Rubber (China) Co.,
Ltd. is aiming to strengthen awareness of Yokohama Rubber within
the local community. In the future, we will continue to proactively
undertake community contribution activities, including theprovision of support for educational institutions.
* Key University: In China, universities that are outstanding in a particular field(s) aredesignated as Key Universities by the government, and receive priority in the provision of
government funding support. Both public and private universities are eligible fordesignation as Key Universities.

A student who has received a Yokohama Scholarship

I would like to express my sincere appreciation for the support that Yokohama Rubber has given to ouruniversity and to its students.
I was born in a small village in Shanxi Province. My parents were not wealthy, but they brought me up withlove and care.
I firmly believe that studying hard is the only route to success.
Receiving this scholarship is a great honor for me. I am determined to acquire as much specialist
knowledge as I can during my time in university, and then go on to accumulate practical experience insociety, so that I can build solid foundations for my future career and live up to the expectations of myparents, my teachers, and everyone else that cares about me.
I hope that all of the students who have benefited from the support provided by Yokohama Rubber will beable to enjoy healthy, successful lives in which they can fulfil their dreams, and that in doing so they will
also be making a contribution to the continued development of Yokohama Rubber. Thank you!

Liu Xiliang, Class 134, Rubber Science Division, Qingdao University of Science and Technology

23

We build a trusted identity as a contributing member ofthe global community by making contributions to thedevelopment and prosperity of local communities.
< Our Goals >Making contributions to local community development by engaging with the community, with afocus on the Forever Forest Project (a 500,000 tree-planting project)

Making a positive contribution to society through collaboration with Chelsea FC

Meeting with children from all over the world who have participatedin Chelsea Foundation soccer schools

with the Chelsea Foundation has also helped to raise Yokohama
Rubber’s international profile.
Yokohama Rubber is also providing support for New York footballclub FC Harlem through our collaboration with Chelsea FC. FC
Harlem uses a range of football-based activities to keep children
from low-income households from getting involved in drugs andcrime.
In the U.K., Yokohama H.P.T. Ltd. (YHPT) has also collaborated withChelsea FC on an awareness-raising initiative that makes use of shortfilms reminding people of the importance of vehicle safety
inspections (featuring players from the Chelsea Ladies team) which
are shown on the main display screen after matches at the Chelsea
FC Stamford Bridge ground, as well as tire safety information printed
on the back of football match programmes. This initiative has beenvery well-received, and has been awarded the Tire Safety Association
Award from TyreSafe, a British NPO. Yokohama Rubber will continue
to collaborate with Chelsea FC in the future, endeavoring to make apositive contribution to both tire safety and local communities.

Yokohama Rubber’s Important Issues

Following the signing of an Official Partner agreement between
Yokohama Rubber and English Premier League football club Chelsea
FC, Yokohama Rubber has been providing support for the Chelsea
Foundation. The Chelsea Foundation is actively involved in using
sport as a way to undertake socially-beneficial activities at thecommunity level.
The Chelsea Foundation’s core activity is the holding of soccer
schools for young people. These soccer schools are held in a wide
range of different locations: at the invitation of Yokohama Rubber,
for the 2016–2017 season the Chelsea Foundation arranged for its
coaches to provide soccer schools for local children in locations near
Yokohama Rubber facilities in various parts of the world, including
Qatar, several locations in Russia (including Moscow), and several
locations in the U.S.A. Around 50 children are able to participate ineach soccer school. Besides providing the opportunity to learn someof Chelsea’s first-class soccer skills, the schools also help children todevelop a positive outlook on life. Chelsea FC soccer schools areoften the subject of reports in local media, and so this collaboration

Soccer school at FC Harlem in the U.S.A.

24

Together with
Our Customers

Yokohama Rubber’s Important Issues

Bringing together a broad spectrum of new technologies to develop the"tires of the future"25

In September 2017, Yokohama Rubber launched the "iceGUARD
iG60", a new product under our iceGUARD brand of studless tires
designed to provide enhanced safety when driving on winter roads.
As befits a product introduced in 2017, the final year of
implementation of Yokohama Rubber’s GD100 medium-range
management plan, the "iceGUARD iG60" is a truly superb studlesstire that incorporates all of our company’s latest technologies. The
last few years have seen significant changes in road conditions dueto the increasingly widespread adoption of snow-clearing
technology and the impact of rising temperatures; there has been
growing awareness of the need for studless tires to provide
outstanding performance not only on ice but also on wet roads.
"iceGUARD iG60" added good performance in wet conditions andsuperior noise reduction to the existing key strengths of the
iceGUARD brand: first-class performance on icy roads, long-lastinghigh performance, and improved fuel economy. "iceGUARD iG60"
achieves this through the adoption of a unique asymmetric tread
pattern and the use of a newly-developed "Premium Absorptive
Compound".
The new tire tread pattern improves grip on ice through effective
use of the edge effect on the inner side of the tire and throughenhanced traction, while greater stiffness makes for smootherhandling.
The new "Premium Absorptive Compound" enhances the ability toabsorb the film of water on the surface of the ice that is a major
cause of cars skidding on ice, through uniform distribution of the
new "Absorptive Micro Balloons". "iceGUARD iG60" also incorporates
a new "Silica High Reactive White Polymer" that increases the
proportion of silica in the mix and provides more uniform
distribution; by strengthening adhesion to the road surface, thisimproves performance on both icy and wet roads.
In addition, the "Orange Oil S" that Yokohama Rubber has developedfor use with studless tires helps "iceGUARD iG60" tires to maintaintheir flexibility and their performance on ice for a longer time.
Thanks to the adoption of these new technologies, "iceGUARD iG60"
provides an improvement in braking performance on ice of 15%,
and an improvement in performance on wet roads of 5%, comparedto our iceGUARD iG50 PLUS . It also provides a level of performancesustainability and fuel economy comparable to iceGUARD iG50
PLUS.
In the future, Yokohama Rubber and "iceGUARD iG60" will continue
striving to make driving on winter roads safer throughout the world.

Yokohama Rubber’s involvement in motor sports has helped toenhance our global brand visibility while also driving thedevelopment of new technologies for Yokohama Rubber tires. In the
60-year history of our participation in motor sports, we havesupplied a wide range of tires for motor sport competitions, mainly
under our flagship ADVAN brand.
Recently, there have been major changes in the wider social
environment that have affected cars. The scope of what is expectedfrom tire performance has expanded to include
economy—particularly in terms of fuel economy—and also how
environmentally-friendly the tires are, and countries throughout theworld have been formulating new regulations that tires are expected
to comply with. At the same time, there is still room for improvementin other aspects of tire performance (including durability, wear
resistance, light-weighting, steering control, etc.).
In the future, as the regulatory constraints on tires become evermore restrictive, Yokohama Rubber will continue to make effective
use of the full gamut of our technologies to further enhance all of
the functions that tires are expected to provide.

We supply safe and secure products through manufacturing
focused on our passion and technology.
< Our Goals >Achievement and maintenance of zero violations of regulations and voluntary codes concerning
usage of our products and services

Providing highly reliable hoses that support offshore oil transportation throughout
the world

VOICE

Italian factory (through acquisition in 2014), and at its factory on
Batam Island, Indonesia. Having three production facilities indifferent parts of the world provides Yokohama Rubber with asignificant competitive advantage: we are able to supply customers
from the plant that is most convenient for them in terms of logistics
and delivery schedules, and we are also able to provide prompt
after-sales service.
In the past few years, we haveestablished new sales offices in
Singapore, Germany and the U.S.
that are functioning as hubs forthe continued expansion of ourmarine hose business. By
providing high-quality products
and making effective use of thereputation of the Yokohama
Rubber brand, we aredemonstrating ourdetermination to become aneven bigger presence in the
global market.

Yokohama Rubber’s Important Issues

Marine hose is one of the key products at Yokohama Rubber’s
Industrial Products Division, and which we hold a very high global
market share. Our marine hoses play a vital role in the safe offshoretransportation of petroleum. The Yokohama marine hose products
are custom-made to the needs of the individual customers, carefully
designed to suit the hydrographic conditions in the areas where
they are used, as well as the shape of related systems, andanticipating the frequency of use.
Marine hoses are a product where reliability is vitally important, as
damage can result in leakage of crude oil, and pollution of theocean. Yokohama Rubber understands this matter and offers
products with high reliability, including the industry-leading
double-carcass hose, with enhanced leak detection capability.
To ensure that customers can enjoy even greater peace of mind whenusing our marine hose products, Yokohama Rubber has obtained
certification for its Seaflex marine hose products under the GMPHOM
2009 international certification framework, as formulated by the Oil
Companies International Marine Forum (OCIMF). This certification
requires the completion of a rigorous evaluation program, including
the implementation of dynamic fatigue testing up to 25,000 times.
In addition to our existing Hiratsuka Factory, Yokohama Rubber has
also begun commercial production of Seaflex marine hose at its

Dynamic fatigue testing in progress

A marine hose customer

Due to the exposed locations of the offshore oil and gas production facilities, the transfer operations areoften carried out under severer weather conditions than normally encountered at near shore applications.
There is an overall requirement for extreme reliability, considering numerous factors including the cyclicloading on the hose against the constant wave action, the increased connection loads between hosesections and terminations, and additional crushing loads and bending forces being applied when the hosestring is stored on a hose reel.
Having been involved in numerous projects where Yokohama hoses are used for the offloading systems of
FPSO’s and FSO’s, I found the hoses to be of high quality and give exceptionally good performance. The
construction of the hoses is robust and able to withstand the rigorous requirements imposed on the hoses.
Furthermore, the Yokohama factory provides sound engineering support their products and this is helpful inthe development of new concepts and systems for transferring fluid between vessels.
With the industry moving towards more developments of offshore gas fields, and in particular the
production of liquid natural gas, it is hoped that Yokohama can expand its hose technology to include hoses
suitable for the offshore transfer of cryogenic fluids.

Alan Hooper, President, Promor Pte. Ltd. (an offshore oilfield engineering firm)26

To Our Stakeholders
and Investors

Aerial view of the Yokohama Test Center of Sweden

Yokohama Rubber’s Important Issues

Expanding our commercial tire business through the acquisition ofAlliance Tire Group and of Aichi Tire Industry
One of the tire business development strategies included in Phase IV(2015–2017) of the Yokohama Rubber Group’s GD100 medium-term
management plan is to grow the commercial tire business. With theaim of helping to realize this goal, Yokohama Rubber acquired
Alliance Tire Group B.V. (ATG) in July 2016, and Aichi Tire Industry Co.,
Ltd. in March 2017. Demand for commercial tires is reckoned toaccount for approximately 45% of total global tire demand,compared to around 55% for consumer tires; through theseacquisitions, Yokohama Rubber succeeded in raising commercial
tires’ share of our total tire sales substantially, from 20% to 32%.
Through the addition of ATG, a specialist manufacturer ofoff-highway tires, and Aichi Tire Industry, a specialist manufacturer ofindustrial tires, we are aiming to strengthen our commercial tirebusiness by adding tires for agricultural machinery and forestry
machinery and industrial tires to our product line-up. We are also
making effective use of the brands owned by ATG; in May 2017, webegan sales of Alliance brand tires, giving us a second passenger car
tire brand which is focused on the European market.
In the future, by making effective use of the respective strengths of
ATG and Aichi Tire Industry, we expect to be able to realize a highlevel of synergy. Initially, we will be using collaboration on design
and production technology to make product development andproduction more efficient, and then go on to reduce procurement
costs and logistics costs. We will be also utilizing the respective
management resources of Yokohama Rubber, ATG and Aichi Tire
Industry to achieve stronger growth and enhanced earnings
performance in the tire business as a whole.
ATG is a multinational corporation with production locations in India
and Israel and with strong brands and extensive sales networks inthe European and North American markets. Rapid decision-making
and brisk organizational management are key characteristics of
those firms that succeed in achieving high growth and superior
earnings performance in global markets. Particularly with respect tomanagement, these firms tend to have a corporate culture thatencourages all managers to keep costs and financial performance inmind all the time when performing their duties.
In the future, the Yokohama Rubber Group will be striving to take fulladvantage of the marvelous opportunity presented by theacquisition of ATG, working proactively to incorporate amultinational-style organizational structure and organizational
management methods oriented towards achieving rapid growth inglobal markets into the operations of the Group as a whole.

Technology exchange in progress

Four strong brands

・A long-established agricultural
machinery tire brand, originating witha company founded in Israel in 1950
・Has a product line-up with more than
1,000 different products and sizes
・Has a strong presence in the European
market27

・Has been heavily focused on tires forconstruction vehicles since the 1970s
・Has a strong presence in the North
American market

・Mainly produces tires for use onforestry and mining equipment
・Has a strong presence in the North
American market

・Japan’s leading industrial tire brandWe improve our company value by growing business
opportunities.
< Our Goals >Continuous improvement of corporate value and an identity that is trusted by all stakeholders.

A global network of R&D facilities
can use human evaluation as a basis for continuing to create thekind of tires our customers want.
Yokohama Rubber’s Important Issues

By focusing on creative effort, practical application, and composite
technologies, Yokohama Rubber has taken up the challenge of
exploring the potential of rubber polymer technology and various
other technologies.
Our materials research includes not only research on rubbercompound tire materials, but also the creation of a wide range of
new materials, including metals, aramid fiber, carbon fiber andplastic materials. These materials are utilized in the development of
products that make effective use of their material properties across awide range of industry sectors, including tires, industrial products,
aerospace products and sporting goods.
In our tire business, to ensure that R&D activity is carried out close to
our major markets, we have established tire R&D centers in North
Carolina in the U.S. and in Thailand, and the Yokohama China
Technical Center in Zhejiang Province, China. These facilities conduct
a wide range of activities, from raw materials testing and evaluation
through to quality assurance. At these R&D centers, products areassessed from multiple perspectives, contributing to thedevelopment of next-generation technologies.
Given that tires play a vital role in safeguarding people’s lives, it isvitally important that we carry out practical evaluation from asafety-oriented, human-centric perspective. Yokohama Rubber has
established the Tire Test Center of Asia in Thailand, which functions
as the Group’s main tire testing track, and also the Yokohama Test
Center of Sweden, a dedicated winter tire testing track. At these test
tracks, testing is carried out repeatedly using real vehicles, so that we

The Tire R&D Center in North Carolina, U.S.
(located on the Charlotte campus of the University of North Carolina)

Tire Test Center of Asia

Corporate GovernanceIn fiscal 2016, Yokohama Rubber worked to achieve a further
strengthening of corporate governance. One important measurethat was implemented was the inclusion of external directors as
members of the Personnel/Remuneration Committee for Corporate
Officers and Directors, with the aim of helping to ensuretransparency and fairness in regard to personnel and compensation
issues relating to directors and corporate officers. An Outside
Directors Committee was also established, with a membershipconsisting solely of outside directors (Outside Directors and Outside
Audit & Supervisory Board Members), with the aim of fostering theexchange of ideas and building of consensus among external

directors; it is intended that the Outside Directors Committee willcontinue to meet twice a year.
With regard to the effectiveness of the Board of Directors, in 2017 an
evaluation survey was implemented, targeting all directors (with the
exception of the Chairman of the Board), including external
directors. The results obtained in this survey were presented at a
Board meeting, so that the issues identified could be shared will all
Board members. On the basis of the views and opinions expressed inthis survey, we will be working to further improve the functioning of
the Board of Directors in the future.

28

Together with
Our Business Partners

Presentation of awards at a Supplier Quality Coordination Meeting

Yokohama Rubber’s Important Issues

Holds MB Business Supplier Quality Coordination Meeting to enhance product quality
Yokohama Rubber’s MB Group currently purchases component parts
from approximately 200 suppliers, as well as engaging in transactions
with a large number of processing service providers and otheroutsourcing partners.
We are committed to ensuring that our customers can continue toenjoy a stable supply of high-quality MB products, and we arecollaborating with our suppliers to strengthen our ability to respondeffectively to quality issues.
As part of these efforts, since fiscal 2015 we have been holding annual
Supplier Quality Coordination Meetings, at which the suppliers of all
four of the MB Group’s divisions are invited to meet together withother manufacturing industry professionals to share ideas for raising
the overall level of quality awareness. The scale of the Supplier Quality
Coordination Meetings has expanded over the years; the third
Supplier Quality Coordination Meeting held in April 2017 wasattended not only by Yokohama Rubber managers working in quality
assurance and procurement related areas, but also by key corporate
officers and all four division heads from the MB Group, as well as by
the heads of technology and production related divisions, for a total ofaround 50 Yokohama Rubber managers attending. At the Meeting,Yokohama Rubber managers gave presentations on the company’sbusiness strategy, quality, and CSR, and representative of two
suppliers gave presentations on case studies of improvements thatthey have made. In addition, awards were presented to outstanding
suppliers, and there was a party for participating suppliers, which
helped to strengthen ties between those attending the Meeting.
Besides the holding of the Supplier Quality Coordination Meeting, wehave also been asking suppliers to submit quality-related self-inspection

VOICE

result reports, and have been strengthening the conducting of on-site
auditing operations on suppliers’ premises. These quality audits arepreventive activities that make use of a checklist formulated byanalyzing the causes of past quality issues; Yokohama Rubber is
continuing to visit the production sites of all suppliers on an ongoingbasis. By deepening the level of direct communication between
suppliers and Yokohama Rubber quality personnel, we are able to foster
mutual understanding with regard to the issues affecting our respective
companies and appropriate strategies for resolving these issues.
By comparison with the situation in fiscal 2014 (prior to theintroduction of these measures), we have achieved a substantial
reduction in the number of defective products attributable tofailings by suppliers. In the future, we will continue working closelywith our suppliers to enhance quality standards still further.

Suppliers’ comments (Extracts)● I have attended all of the Supplier Quality Coordination Meetings so far, and they get better every time. At the most recent Meeting, we were able todevelop a good understanding of Yokohama Rubber’s overall strategy for quality management, and build consensus. I hope that in the future theMeetings will also include an explanation of Yokohama Rubber’s procurement strategy.
● We were able to develop a thorough understanding of what kind of safety, quality and environmental measures Yokohama Rubber is implementing inline with the major trends affecting the automotive manufacturers, etc., and an understanding of the importance of ISO and other management
activities. It would be very helpful if Yokohama Rubber could provide suppliers with support for securing quality-related certification.
● Listening to the case studies of improvement efforts brought home to us just how much hard work has gone into these initiatives at the production
facilities, and these case studies provide a useful reference for us to develop similar measures in our own facilities. I hope that Yokohama Rubber willcontinue to include these case study presentations at the next Meeting.
● It would be good if we had more opportunities to develop closer communication with divisional managers, so as to help us improve the quality of the
products that we deliver. I hope that Yokohama Rubber will try to put the necessary contact windows and measures in place in the future.

29

We promote CSR activities throughout the value chain.

< Our Goals >CSR activities in collaboration with our partners

Natural rubber supplier survey and support for sustainable production of natural rubber
the non-rubber trees as sources of fertilizer, and obtainsupplementary income from the fruit trees. Their attitudes arechanging, raising hopes that rubber farms can be made moresustainable than they have been in the past.
Yokohama Rubber supports the goals of the Sustainable Natural
Rubber Initiative (SNR-i) launched by the International Rubber Study
Group (IRSG), and is participating in SNR-i activities. To help realize asustainable natural rubber economy, we attend SNR-i meetings,
share information with other participants, and endeavor to
implement related measures within our own company.

Yokohama Rubber’s Important Issues

Natural rubber accounts for around one-quarter of all raw materials
used by the Yokohama Rubber Group; natural rubber is a vitalmaterial for the production of our company’s tires and otherproducts. For us to be able to continue to supply customers with ourcompany’s products without interruption, it is extremely importantthat we are able to obtain a steady supply of natural rubber. To
research the current situation, in fiscal 2016 we implemented a
CSR-related questionnaire survey, which was administered to natural
rubber suppliers; all suppliers completed and returned thequestionnaires. From the questionnaire survey results, we were able
to confirm that there had been no human rights issues relating to
the use of child labor or forced labor, etc. On the basis of the survey
results, we are developing a roadmap for CSR-based procurement in
the future, by identifying the areas where our Group’s existing
suppliers may be creating an environmental impact.
As part of our efforts to ensure a stable supply of raw materials andfoster environmentally-friendly behavior by our suppliers, ournatural rubber processing subsidiary Y.T. Rubber Co., Ltd. (YTRC) has
been providing support for the adoption of agro-forestry—which
involves the interspersed cultivation of ten different plant species,
including natural rubber trees, bamboo, fruit trees, etc.—by farmers.
YTRC employees hold seminars at which farmers can learnagro-forestry techniques, starting with the farms of employees’ ownfamily members, with the aim of gradually expanding the scope ofagro-forestry implementation to include neighboring villages andYokohama Rubber’s own raw materials suppliers. YTRC donates
seedlings to neighboring farmers; the farmers are then able to use

Adoption of a Business Continuity Plan (BCP) system linked with our suppliers
The last few years have seen a heightening of society’s expectations
with regard to companies’ response to earthquakes and othernatural disasters, and plant accidents; firms need to be able to access
supplier data rapidly in the event of an incident or inquiry. To be able
to respond effectively in this type of situation, in 2016 the Yokohama
Rubber Group adopted a new cloud-based emergency contact
system in collaboration with our suppliers, and supplier details arebeing updated on an ongoing basis.
The information recorded by the system includes basic company

details and contact details for key managers; the system also ensuresthat the chronological order of responses that have been given toinquiries can be checked. In this way, it is anticipated that if a
disaster occurs or if there is an inquiry regarding CSR procurement,
the most up-to-date information can be accessed on screen and thissystem will make it possible to respond more promptly and more
appropriately.

30

Together with
Our Employees

Members of the Women’s Participation and Advancement Taskforce

Yokohama Rubber’s Important Issues

Working towards the creation of a more employee-friendly working environment—Establishment of the "Women’s Participation and Advancement Taskforce"With the aim of building a more employee-friendly working
environment, Yokohama Rubber is implementing a comprehensive
overhaul of working practices, with the introduction of new systems
reflecting a variety of different perspectives.
As part of these efforts, in line with the Japanese government’s
implementation of the "Act on Promotion of Women’s Participation
and Advancement in the Workplace," in October 2016 seven-member"Women’s Participation and Advancement Taskforces" were establishedin our head office and at each individual production site. In addition totheir regular duties in the department that they are assigned to, eachmember of the Taskforce participates in regular discussion sessions,with full-scale activities commencing in January 2017.
Following the implementation of a questionnaire survey that wasadministered to all employees, individual interviews were held withevery female employee, providing a direct opportunity to hear female
employees’ frank views and suggestions regarding the working
environment. The results obtained from the survey and interviews
helped to clarify how female employees approach their work, andwhat their hopes are regarding the creation of a more
employee-friendly working environment and related systems; we wereable to identify the key issues that we will need to address in order tomake Yokohama Rubber a company that provides meaningful support

for diverse workstyles, including support for employees who need tobalance their work with childcare or other care responsibilities.
By ensuring that the Women’s Participation and Advancement
Taskforces’ analysis of the current situation and key issues (based on
examination of the questionnaire survey and interview results) is
promptly shared with senior management, we are able to rapidly
formulate the basic strategies needed for the creation of a workplaceenvironment in which all employees can maximize their potential.
Taking as our core strategy the goal of "Aiming to be a company thatwelcomes diverse workstyles, with an employee-friendly working
environment that will encourage employees to stay with thecompany over the long term," we will be undertaking internal
reforms aimed at building a workplace environment in which
employees support one another, and in which every employee canfully develop their capabilities and talents, without feeling that theyneed to give up their career. The Women’s Participation andAdvancement Taskforces are currently working to strengthen
coordination with Yokohama Rubber’s Global Human Resources
Department and IT & Management Planning Department, etc., andare implementing activities aimed at fostering an attitude to workthat is free from gender bias among all employees, as well as therevision and implementation of relevant systems.

Employment of people with disabilities that meets their real needs
In order to provide people with disabilities with a workplaceenvironment in which they can work with maximum peace of mind,
Yokohama Tire Japan Co., Ltd. (YTJ) has forged a partnership with
Startline Co., Ltd., a company which helps develop satellite offices
with the aim of providing employment support for disabled people.
A new Yokohama Office, a satellite office providing employment forpeople with disabilities, was established in April 2017; four disabled
persons, employed as contract employees, perform work involving
HR-related data collation and inputting, etc.
YTJ has employed disabled people in the past, but they often foundthat even just coming into the workplace was a challenging
experience; in many cases, they left the company after a short period
because of difficulty in adjusting to the frenetic pace and thecomplex interpersonal relationships. This experience brought home
to us that creating an environment in which people with disabilities
can work with peace of mind is no easy task.

31

The Yokohama Office has staff from Startline (who possess specialist
expertise in providing support for the disabled) permanently
stationed there, who hold periodic one-to-one meetings with thedisabled people working at the Office; the responsible Human
Resources department manager is provided with feedback on aregular basis. This arrangement makes it possible to adjust thedisabled employees’ workload or the type of work they perform byadding a third-party opinion on the individual employee’s current
state of health to the discussion between the disabled employee
and the Human Resources manager. It is important that disabled
employees take frequent breaks so that they do not exhaustthemselves by working continuously for too long; the Yokohama
Office provides an environment in which it is easier (both physicallyand mentally) for employees with disabilities to continue to work,and enabling them to enjoy peace of mind while playing an active role.
When the Yokohama Office was first established, there wereWe value and develop our people, and create opportunities
for people.

< Our Goals >To be an organization that allows people of diverse ages, genders, and nationalities todemonstrate their maximum capabilities
Establishing a zero-hazard culture of safety by promoting physical and mental healthRespecting human rights both internally and externally; no child labour or forced labour in ourgroup or by our partners; sincerely responding to and improving complaints on human rights

VOICE

Comments by people working
at the Yokohama Office● "Having regular visits from managers at YTJ’shead office, who are always very friendly andpolite, is very encouraging, and helps us to carryout our work with real peace of mind."● "I very much appreciate having the Startline staff
here to provide back-up for our work and healthconditions."● "I feel that, right from when I first joined thecompany, YTJ has made a real effort to create adisability-friendly environment, for example interms of flexibility in working hours and being
willing to accommodate time off for hospitaltreatment, etc."● "This was the first time that I had taken up
employment as a disabled employee, so initially I
was quite nervous, but thanks to the considerate,
helpful training and the weekly meetings with
the Startline and YTJ staff, I have been able towork with genuine peace of mind."

VOICE

opportunities for communication between the Yokohama Office andemployees at YTJ’s head office, and to spread awareness throughout
the company of the work results achieved by the Yokohama Office.
By expanding these efforts throughout the company, we can getpeople to recognize the important source of human talent that
disabled people represent, with the aim of expanding the scope ofwork entrusted to them.

Yokohama Rubber’s Important Issues

concerns that having the new Office physically separate from the YTJ
head office might make work-related communication difficult, andthere were some teething troubles in terms of what type of work to
assign to the new Office. Now, however, by holding meetings with
relevant managers to decide on the appropriate workflow inadvance, it has become possible for work to proceed smoothly
based on procedures that are not a burden for either the disabled
employees at the Yokohama Office or YTJ’s head office. Throughregular visits to the Yokohama Office by managers from YTJ’s head
office, and through information-sharing with Startline, we are able to
make precise adjustments to reflect individual employees’ current
state of health and other circumstances, as needed.
By making effective use of the skills possessed by the employees at
the Yokohama Office, we have been able to undertake data collation
work that we had previously not had time to get started on at thehead office. Also, getting employees to check each other’s work has
led to a substantial improvement in the overall quality of the work
performed. We have had some very positive comments from theemployees working at the Yokohama Office, such as "I had been outof the workforce for so long, and it is great to be able to work again,"and "I appreciate the fact that people interact with us in a
non-discriminatory way."
In the future, we will be working to further increase the

The Yokohama OfficeComments from a Startline manager

Startline Co., Ltd. provides consulting services regarding workplace development
and recruitment, as well as services relating to the establishment and running ofsatellite offices for people with disabilities.
YTJ established its satellite office in April 2017, and there are now four disabled
people working there. I have been very pleased to see that, although only a shorttime has elapsed since then, we have already started to see progress in terms ofpeople being able to work longer than when
they first joined the company, and people
collaborating in ways that take account of thespecial aspects of their individual disabilities.
In the future, we will continue to provide
support aimed at helping the satellite office torun itself autonomously and at realizing
stable, long-term employment for the people
working there.

Yasuda Satsuki,
Yokohama Center Support Staffer,
Satellite Office Division,
Startline Co., Ltd.

32

Our Commitment toSocial Challenges
over the Next 100 Years
Relationship between our business and SDGs
going forward.
An assessment will be conducted on the efforts in response to social
challenges by all Group companies based on documents andinterviews from the four perspectives of planning, implementation
status, monitoring, and communication of results.

Yokohama Rubber has confirmed the current state of initiatives
through its business in consideration of the objectives of sustainable
development goals (SDGs), and analyzed which target areas
initiatives should be strengthened in going forward. Based on thisanalysis, Yokohama Rubber will endeavor to review its priority issues

Our Commitment to Social Challenges
over the Next 100 Years

Relationship between efforts through the value chain and SDGs
Strengthening
positive effects❶❷

Raw materials

Minimizing
negative effects

❽

❸

❹

Raw materials
subcontractor❺❻

Product
manufacturing

Sales

❾

⓫

Use ofproducts⓬

Disposal of
products⓭❶Systematic monitoring and protection of rubber trees, plantations, and theecological system at the stage of raw materials use❼Project for considering infrastructure for a hydrogen-based society that has adopted
highly durable conveyor belt for a reconstruction project in Rikuzentakata City

❷Education on agroforestry farming, etc. for rubber farmers at the procurement stage❽Preservation of forests and protection of the ecological system by supportingplanned agricultural management❸Income support through employment for processors and local companies indeveloping countries❾Recycling of water during production, effective use of groundwater, etc.

❹Resource conservation and the development of new materials through LCA analysis
on natural resources❿Introduction of cogeneration systems and renewable energy, spread ofenvironmentally friendly products❺Indirect contributions to agriculture through the sale of tires in the field ofagriculture and forestry through ATG⓫Reduction of greenhouse gases through❿above❻Improvements in CSR procurement and the environmental technologies of suppliersin the MB business

VOICE⓬Use of heat from waste tires, achieving zero emissions at plants, promotion of retread
tires, development of more highly durable products⓭Prevention of marine pollution through marine hose development and improvements

Comment from an analysis and assessment organization

Mizuki Kurauchi
Environmental Assessment
Section Manager,
Global Environmental
Project Department,
Japan Quality Assurance
Organization

33

❿

❼

We recently confirmed the business performance of the Yokohama Rubber Group and its business processes
through the filter of SDGs. As a result of this assessment, we found that nearly all of the activities conducted inaccordance with the vectors indicated in the CSR Management Vision, Yokohama Group Action Guidelines, and
GD100 and Environmental GD100 mapped with the SDGs, and that actual management of the organization wasclosely linked with the resolution of social issues for sustainable development.
Looking at the results of mapping in the value chain, there were many extremely positive areas including multiple
efforts in upstream processes that assist in achieving SDGs, and multiple efforts that strengthen positive effects
and minimize negative effects that have been conducted since in the past with clear objectives related tosustainability. Going forward it would be preferable to review what challenges should be tackled as priorities insustainable development goals through materiality analysis and dialogue with stakeholders.
We hope that Yokohama Rubber remains to be a global company for the next 100 years and continues tocontribute to happiness and prosperity based on sustainable development.
* The CSR Report 2017 that contains this comment has been prepared based on materials including sustainability reports deemed to begenerally acceptable, and this comment does not represent the conclusion that information contained within the CSR Report 2017 has been
accurately measured and calculated and disclosed without omission.

Yokohama Rubber celebrated its centennial on October 13, 2017.
We would like to introduce how we will be involved in the
resolution of social challenges and our efforts from theperspective of technology development for the provision of new
products and services over the next 100 years.

Basic technologies to support the future development of products and services
at Yokohama Rubber
Computational Science Aeroacoustic simulation
The reduction of tire noise is an important environmental issue. As
the disruption of the flow of air around tires and the road surface is
one of the main causes of tire noise, we are engaged in research(i) No groove(ii) Groove shape A

related to direct simulations of air vortex flow structure around tires
and the resulting acoustic waves.

(iii) Groove shape B

Turbulent kinetic energy in front of tire

In 2014, Yokohama Rubber succeeded in
becoming the first in the world to have aprecise simulation of the vortex structure
and acoustic waves around tires whenrunning.
In 2015, the theme was selected as an HPCI(High Performance Computing
Infrastructure) research topic, and theimpact of the differences in the depth,
width, etc. of grooves on the tire surface on
acoustic waves (noise) was clarified.
This has been helpful in the design of tread
patterns and facilitated the development of
low noise tires.

Our Commitment to Social Challenges
over the Next 100 Years

Instantaneous pressure fluctuations and vortex structure

Analysis 3D structural analysis of tire steel cord / rubber adhesion surfaces
Steel cords are embedded in tires to improve durability.
The adhesion between these steel cords and the rubber that covers
them is important for safety.
We have utilized electron microscope technology to become the firstin the world to visualize the adhesion layer between steel cord andrubber surfaces in 3D (see diagram).
Some separated areas and/or spaces were discovered in the

Rubberadhesion layer in the rubber and metal adhesive interface for thewire sample after humidity aging.
The adhesive force between steel cord and rubber is weak in theseareas, and can be inferred that this is a source of declines inadhesiveness. Going forward we will further clarify the adhesion
mechanism and apply this knowledge to the development of more
durable tires.

Result of 3D observationof the adhesion layer
between steel cord andrubber (the circle
indicates an area withadhesion defects)

Steel cord

34

Yokohama Rubber

ISO 26000

Compliance Activity Report[Self-evaluation code] 〇：Achieved or improved △：Unachieved or unchanged ×：Deteriorated
Our Goals

Continuous improvement of corporate value and an identity that is trusted by all stakeholders.
Economic performance

Compliance

Allocation of economic value(non-consolidated)

Organizational
Governance Accomplishments

million yen

400,000

200,000

Local community

100,000

Customers

336,645

(

)

82%

988
(participants
)

2015

2016

FY

(

30

40

20

20

10
2014

2015

2016

least 90% of employees○ toAthaveundergone training* No. of complaints received through official channels

Cases

Cases

4

4

3

3

2

2

5

1
0
2014

0
2015

0
2016

○

Occupational safety and healthTraining and education programs

Lost worktime rate(consolidated)

Time for education and training(non-consolidated)
Hours

0.60

10

0.47

0.5

Comprehensive
workers

8.9

8.3

Engineers

FY

Target for FY2017

0casesDiversity and equal opportunity
Female employment rate for main
career track (non-consolidated)* Cf. rate of female employees (consolidated): 12.8%%
40Comprehensive
workers Engineers

8.9

9.0

6.0

10

2
2015

2016

△

0

FY

34
25

20

4

2014

38

30

Engineers

6.0

6

2014

2015

2016

0

FY

2014

○

*Internal target
not reached

2015

2016

FY

○

To make all of our products environmentally-friendly
To reduce the total amount of GHG emissions (to 50% lessthan 2005 levels across the value chain)
To promote the efficient use of water resources according to thecharacteristics of water risks
To develop biodiversity conservation activities at production sites
Materials

Water

Total amount ofmaterials used(consolidated)

Water intake(consolidated)

800

791

789

10,000

600
400

0

2014

2015

○

2016

Products and services
Biodiversity conservation
Implementation rate ofEnvironmentally-friendly
conservation activities at
product rate among all of
production
sites (consolidated)
our products (consolidated)

thousand
m3

757

200

The global environment

Comprehensive
workers

8

0.40

0.4

Selfassessment

Selfassessment

0
2016

○

0cases0.2

Accomplishments02015

To be an organization that allows people of diverse ages, genders, and nationalities to demonstrate their maximum capabilities
Establishing a zero-hazard culture of safety by promoting physical and mental healththousandtons

The
Environment

0
2014

0

FY

Target for FY2017

0.3

Our Goals

FY○

Human rights grievance mechanisms

0

Employees

2016

Official number of complaints to the Grievance
Mechanisms (consolidated)

0.1

Partners

2015Child labour / forced or compulsory labour%
0.6

LabourPractices

2014

Target for FY2017

Selfassessment

Accomplishments

0

FY

47

31

Number of jobs identified as suspected child labouror forced labour (consolidated)Accomplishments

Our Goals

50

50

Respecting human rights both internally and externally; no child labour or forced labour in our group or by ourpartners; sincerely responding to and improving complaints on human rights

0

Employees

60

)

40

1

Partners

Cases

531
participants

5

Human Rights* Does not include non-anonymous consultations

100%

60

0

* per 1 million hours

35

99%

5,788
participants○

Selfassessment

Our Goals

ISO 26000 Compliance Activity Report

2014

Whistle-blowers(consolidated)* among eligible employees

%
100
80

0

Stockholders and investors
Employees

379,842300,000

The global environment

Partners

397,087

Training participants rate(non-consolidated)

FY

8,660

8,682

%
100

9,044

8,000

80

6,000

60

4,000

40

2,000

20

0

2014

2015

○

2016

FY

* Due to the
expansion of thescope of calculation

095* Scope of estimation has been adjusted
%
50
39
38
40
32*
30

99

98

20
10
2014

2015

○

2016

FY

Target for FY2017

100%

0

2014

2015

○

2016

FY

The Yokohama Rubber Group selected priority issues for each group of stakeholders.
In this section, we report on the priority items identified according to ISO 26000 and our progress toward achieving
them, as well as the data requested for disclosure.
On our CSR Website, we describe backgrounds regarding the importance of each priority, our goals, our aspirations, theFY 2016 activity report, the challenges we faced, and future measures.

Please refer to our CSR Website for detailed reports ofeach achievement.
EnergyAir emissions

Total consumption(consolidated)

Greenhouse gas emissions(consolidated)

MWh

Accomplishments

1,500,000
1,250,000

1,231,611

1,313,532

1,000,000

The
Environment

750,000

311,668

332,453

1,341,111

250,000

The global environment

2014

thousand
tons

500,000

30,000400,000

20,000200,000

500

100,000

250

0
FY

2016

○

Selfassessment
Our Goals

2015

KL

300,000

339,375

500,000
0

Scope
(3)
23,920

Cases

10
8

Scope Scope(2)(1)
334 351

Scope Scope(2)(1)
326 358

6

Scope Scope(2)(1)
342 357

4
2

2014

2015

2016

0
2014

0

FY

0
2015

0
2016

FY

○

○

Partners’ compliance complaint(Grievance mechanisms for
impacts on society)

Participating companies in
our CSR workshops for partners

Target for FY2017

0cases

Official numbers of complaints to the Number of participating companies/
grievance mechanisms (consolidated) participation rate (non-consolidated)

5* Small and medium size companies withwhich we have a stable amount of business
%
90.3
90.3
90.2
500
100

80

4

400

60

3

300

40

2

200

40

20

1

100

20

0

0

%
100

100

2014

2015

○

2016

* No. of complaints received through official channels
Cases

100

100

Selfassessment
Our Goals

Scope
(3)
23,831

Official number of complaints to the
Grievance Mechanisms (consolidated)* No. of complaints received through official channels

FY

Companies

0
2014

0
2015

○

Target for FY2017

100%

0
2016

0

FY

299

2014

Target for FY2017

0cases

317

80

312

60

0

2015

2016

○

90% or higher

FY

Target for FY2017

Achievement and maintenance of zero violations of regulations and voluntary codes concerning usage of our
products and services

ISO 26000 Compliance Activity Report

Partners

Environmental grievance mechanisms

CSR activities in collaboration with our partners

Percentage of partners that
we started working with after
impact assessments (consolidated)Accomplishments

Scope
(3)
30,8440Partner assessment for environment,
human rights, labour practices
and social impacts

Fair Operating
Practices

http://www.y-yokohama.com/global/csr/

Safety and health for our customers, labeling compliance of our products and services

ConsumerIssuesAccomplishments

Number of violations of regulations or
voluntary codes concerning product safety,
labeling, and provision of product usage
information (consolidated)

Cases

5
4
3
2
1
0

Customers

1

1

2014

2015

2016

FY

* There was an incident of non-compliancewith golf club rules, which was attributable
to Yokohama Rubber.

Selfassessment△

Our Goals

Making contributions to local community development by engaging with the community, with a focus on the
Forever Forest Project (a 500,000 tree-planting project)

Community
Involvement
Accomplishments
andDevelopment

Selfassessment

Target for FY2017

0casesLocal communities

Promotion of the Forever Forest ProjectMarket presence

Implementation rates of community
activities and dialogues at
production sites (consolidated)

Number of trees planted in a year
(cumulative) /Target achievement rate

Percentages of sites which pay
salaries higher than minimum wage
(consolidated)

%
100

100

100

No. of trees

100

500,000

83

91

100

%
100

80

80

60

60

%

80

400,000

74

60

300,000

369,15040

200,000

40

40

20

100,000

20

20

0

0

0

Local society

1

2014

2015

○

2016

FY

Target for FY2017

100%

0

2014

414,6972015○

452,5912016

FY

Target for FY2017

500,000 trees

100

100

100

2014

2015

2016

○

FY

Target for FY2017

100%

36

Information Map
We would like to introduce the information disclosed on our website.

Website of Yokohama Rubber
http://www.y-yokohama.com/global/
❶

❷

❸

❹

❺

http://www.y-yokohama.com/global/csr/

Our CSR website❶ Centennial website❹ CSR❷ Products Information❺ Corporate Information

Introduces a chronology of our 100 years of history through a video
Delivers information about product features and specifications, including
tires, industrial products, and sporting goods

Provides information about ESG policies, activities and progress
Highlights the corporate philosophy, company profile and governancestructure❸ Investor Relations

Information Map

Presents investor relations information about management plans, growthstrategy and earnings

CSR (Environmental/Social) Activity pages
How to view the Fiscal Year 2016 Activity Report
These web pages introduce the details on matters we prioritize as a company inaccordance with the framework of ISO 26000. This describes the page layout using
the human rights page as an example.
Indicates our stance and policies towards the respective CSR activities.

A responsible personnel describes their stance towards CSR activities and the status of efforts.

Indicates our vision toward activities.
Shows our priority issues. Click here to see the progress status and KPIs.
You can view the progress status of general CSR activities we are involved with.

Other information
Annual Report
The Annual Report that contains our financial statements, etc. is issued at the end of May
every year.

http://www.yrc.co.jp/cp/global/ir/library/areport/
Securities Report
The Securities Report that contains an overview of Yokohama Rubber, a description ofbusiness activities, etc. based on the Securities and Exchange Act is issued every year.

http://www.yrc.co.jp/cp/ir/library/securities/

37

Third-Party Opinion
The description herein refers to the opinions based on this report and a related website(http://www.y-yokohama.com/global/csr); interviews held with persons in charge from the planning, quality assurance, andraw/indirect materials procurement departments of Yokohama Rubber’s Tire and MB divisions, as well as from the corporate
planning, quality audit, human resources and safety and health, general affairs, compliance, and CSR departments; and alongwith on-site observation of the various bases for tire production and testing, MB business production, rubber processing bases(YTMT, TTCA, YRTC, and YTRC) in Thailand, and rubber plantations that provide natural rubber raw materials to YTRC.
While Yokohama Rubber’s various approaches to CSR are continuing to advance on the field level, it can be said a further clear
and concrete commitment from management could be called for.

Hideto Kawakita

CEO and Editor/Publisher of Socio Management
International Institution for Human,
Organization and the Earth (IIHOE)IIHOE: The International Institute for Human, Organization and the Earth is a
non-profit organization established in 1994 for the democratic and balanced
development of all the lives on the earth. Although it mainly provides
management support for citizens’ groups and welfare workers, the group is alsoheavily involved in providing CSR support to large corporations.
http://blog.canpan.info/iihoe/ (available only in Japanese)

Truly Commendable Areas
Regarding conservation of biological diversity: (http://www.y-yokohama.com/
global/csr/report/environment/environment03/), over the period of ten years since
the start of the YOKOHAMA Forever Forest Project (http://www. y-yokohama.com/
global/csr/mori/), the Company has planted over 450,000 trees overseas and in Japanin consideration of maintaining and improving biodiversity. These seedlings havebeen cultivated in-house, as 24,000 seedlings (62%) were provided in-houses in fiscal
2016 and a cumulated total of 300,000 seedlings (http://www.y-yokohama.com/
global/csr/mori/widening/) were also provided to municipalities and othercompanies. Systematic activities ranging from seedling cultivation to planting havealso been conducted at business locations overseas, including Thailand and China. I
highly commend the high global standards that have been achieved by the
YOKOHAMA Forever Forest Project as a social contribution program for the
maintenance and improvement of forest ecosystems and greenery, and I also
continue to have high hopes for the project site’s evolution into a comprehensive
portal site that also introduces similar efforts by other companies in multiple
languages.

While Approving of Progress, Areas that May Require Further
Improvement

Areas that May Require Further Improvement
Regarding corporate governance and CSR promotion system(http://www.y-yokohama.com/global/csr/report/governance/governance/),while I commend the promotion of initiatives using key performance indicators (KPI)
based on the core issues addressed by ISO 26000, it concerns me that the effects on
the sustainability of the society and the Company through efforts to achieve these KPI
are unclear, and that there are some departments that view CSR efforts as something
separate from their core operations. Going forward, I sincerely hope the top
management will communicate in their own words in a clear and concrete manner
why and in what manner employees should approach CSR and call for progress
management in day-to-day management. Also, I strongly expect that the Company
will develop a strategy and a system that, led by the managers responsible forplanning in each division, focus on the Company’s position in world markets and theevolution of its business model in the 2020s. In terms of its reporting andcommunication, I would like to commend the Company for providing more detailed
introductions of the initiatives (http://www.y-yokohama.com/global/csr/data/) being
carried out by major Yokohama Group business sites in Japan and abroad; I hope that
the Company will continue to l promote stakeholder engagement further as requiredby ISO 26000, setting up opportunities for continuous dialogue with NPOs in
important operating regions.
As regards employee safety (http://www.y-yokohama.com/global/csr/report/
employee/employee01/), I have concerns that major accidents at business sites
overseas have continued since fiscal 2017. Moving forward, I continue to urge theCompany to make efforts on the field level in addition in improvements to facilities
and structural systems to ensure the greater effectiveness of safety measures and toissue a detailed report about the progress of improvements

Third-Party Opinion

Regarding its quality assurance promotion system(http://www.y-yokohama.com/global/csr/report/consumer/consumer_01/), while I
commend the active implementation of market measures, I continue to look forward
to seeing the Company further advance quantitative and effective measures in
response to quality issues that affect customers, such as assessments of thelikelihood, scale, and severity of issues and the incorporation of the minimization of
impacts on customers as part of its management indicators.
Regarding the reduction of environmental impacts(http://www.y-yokohama.com/global/csr/report/environment/environment08/),
I would like to commend the Company for its achievement of interim targets inregard to total waste generated (on a per unit of production output basis) andgreenhouse gas emissions (total emissions) and the undergoing development oftargets for 2030. Going forward, I strongly encourage the Company to try to meet
the target that the Japanese government has recently set of reducing greenhousegas emissions by 26% by 2030 (compared to 2013) as soon as possible, and tothoroughly shed light on its challenges and methods, such as transitioning to thenon-fixation of energy usage adjustable to the fluctuation of production volume(Just-In-Time for Energy), as well as to expand energy saving effects at the stage ofcustomer use.
As for CSR at suppliers (http://www.y-yokohama.com/global/csr/report/partner/),
I commend the Company for revising the CSR Procurement Guidelines andchecklist, for continuing to hold CSR workshops for suppliers in key countries, forestablishing a commendation system based on feedback from suppliers in regard
to the results of supplier self-checks and field surveys, for conducting surveys on
natural rubber plantations, and for supporting the adoption and implementationof agro-forestry techniques by natural rubber suppliers in Thailand(http://www.y-yokohama.com/ global/csr/report/partner/partner01/). In order tomore effectively improve initiatives being undertaken by suppliers, I strongly
encourage the Company to implement more detailed evaluation of individual
items in guidelines and checklists and measures taken, and to establish a support
system with suppliers for sharing actual cases and further understanding
initiatives in greater detail.

Regarding improvement of workplaces’ ability to retain employees(http://www.y-yokohama.com/global/csr/report/employee/employee03/),
I commend the establishment of the Women’s Participation and Advancement
Taskforce, which aims to be a company that welcomes diverse workstyles, with an
employee-friendly working environment that will encourage employees to stay withthe company over the long term, the fact that 4.16% of Yokohama Rubber
employees took advantage of the systems for paid vacation, leave of absence, or
shorter work hours in order to care for a child or family member in need, and thatYokohama Rubber has started holding of nursing care leave seminars incollaboration with the labor union. I continue to strongly urge the Company toestablish an environment where employees can continue to work, while also taking
leave. In terms of mental health care, I hope that the Company will promote more
effective measures of this kind in the future.
As regards the enhancement of the human resource portfolio required as a
global corporation, I commend the fact that managerial level employees havebeen registered in the global human resources database. Meanwhile, going
forward, I strongly encourage the Company to accelerate its development of thenext generation of executives at both its head office and overseas sites based on along-term goal and strategy that reflects how the Company sees itself being
positioned in global markets in the 2020s, and the business models that it expects
to have adopted.
As regards employment of persons with disabilities, I commend that an
employment rate of 2.15% has been achieved for the Group in Japan and that
opportunities have been expanded in terms of employment conditions andavailable positions. I ask that the Company continues to work proactively toward
implementing measures to ensure that employees with disabilities are retained overthe long term.

Response to Third-Party Opinion
We have received positive feedback as well as suggestions andrecommendations regarding our CSR initiatives. We will makeeven further efforts in areas where we have received positive
feedback, and we will make sincere improvements in response
to suggestions and recommendations.
In response to serious accidents that occurred during fiscal
2017 that improvements are underway for, we will renew ourefforts to rebuild safety equipment and a safety culture. On theother hands, in terms of human resources, we will make
improvements to the workplace environment to all diverse
employees to achieve their full potential and work with theCompany over the long term, and we will also work together
with human resources utilization taskforces both inside andoutside of the Company. In terms of environmental
contributions we will launch the Post-Forever Forest Project,and continue ongoing activities.
As we celebrate our centennial, we will redefine CSR priority
issues and implement resolution measures that will lead us
from the present into the future as we aim for sustainablegrowth for the next 100 years, and we will further expand
contributions to society through the provision of products andservices sought by customers and regional activities atbusiness sites around the world.
Shuichi Tsukada

Officer
Head of Corporate Social Responsibility Division

38

The Yokohama Rubber Co., Ltd.
36-11, Shimbashi 5-chome, Minato-ku, Tokyo
105-8685, Japan

Corporate Communications Department
Tel. +81-3-5400-4531

Corporate Social Responsibility Planning Department

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Yokohama Rubber is a signatory to the United Nations Global Compact.
Yokohama Rubber is an advocate of Fun to Share, a climate change program working to realize a low-carbon society.
Yokohama Rubber Group is an official partner of Chelsea F.C.
This publication was printed on FSC®-certified paper, which includes materials from timber manufactured in properly managed forests.
This publication was printed with a waterless printing method that does not emit hazardous waste fluids.
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