Integrated Report2023

We lead the world with specialty acrylates

Osaka Organic Chemical Industry Ltd.

We lead the world with specialty acrylates

Osaka Organic Chemical Industry Ltd.

Inquiries:
Management Strategy Department, Corporate Planning Division
11F Nomura Real Estate Osaka Building, 1-8-15 Azuchi-machi,
Chuo-ku, Osaka 541-0052
Tel: +81-6-6264-5071
https://www.ooc.co.jp/en/

OOC

OOC

OOC

OOC
OOC

OOC
OOC
OOC

OOC

OOC

Integrated Report 2023

OOC’s Value Creation

OOC Group’s Management
Philosophy System andFounder’s Vision［Corporate Philosophy］[Corporate Philosophy]［Management Philosophy］

Management
Philosophy

We will place the highest value on each person’s individuality and willcontribute to the development of society together with our customers byproviding materials with unique functions.

［Management Vision］

Management Vision

Providing value to the global market as a corporate leader in specialty
acrylates

Medium- andLong-term Plans［Guidelines for Conduct］（excerpt）
Together with all stakeholders
・We will always keep our promises to stakeholders, and will face them witha stance of sincerity and humility.

Guidelines
for Conduct

Together with employees and their families
・We will make the most of each other’s strengths, complement each other,and work as teams to demonstrate our abilities to their fullest.

Local
Communities

Employees

Together with customers and business partners
・We will continue to provide materials with unique functions that can bringabout innovation for our customers.
Clients

G Governance

E Environment

S Society

Data

Contents

The Company and its employees form a single entity that works together
and shares a single destiny. The Company’s prosperity rests on the effortsof the employees; the happiness of the employees flows from the prosperityof the Company.
The Company’s basic policies will always reject the errors of bias andself-righteousness. They will improve individual character through the
integrity and unflagging efforts of each individual along with their mutual
trust, assistance and devotion. They will serve and benefit the community
through superior production activities.

Founder’s
Principles

Promoting
Sustainable Management

OOC’s Value Creation

E Environment

03
05
07
09
11
15
17

41 Environmental Initiatives
42 Climate Change Initiatives (TCFD)
45 Initiatives to Achieve Carbon Neutrality
46 Initiatives to Reduce Environmental Impact

History and Strengths of Value Creation
OOC’s Value Creation Process
Financial / Non-Financial Highlights
OOC Products Used in Everyday Life
Top Message
Medium- to Long-term Business Plan
Business Domains of the Osaka Organic
Chemical Industry Group
22 OOC’s Value Creation(Corporate Officer Responsible for R&D)
23 Message from Corporate Officer
Responsible for Finance

S Society47 Occupational Health and Safety
49 Interactions with Local Communities
51 Workforce Recruiting and Training
52 Respecting Human Rights
52 Creating a Diverse Workforce /Promoting Sustainable Management

Creating Safe and Pleasant Workplaces
53 Promoting Health Management
54 Procurement Activities and Management

25 ESG Management
27 Initiatives for Materialityof Raw Materials
55 Stakeholder Engagement

G Governance

Data

31
32
36
39

56 Financial Statements
61 Ten-Year Summary
63 Company and Shareholder Information

Corporate Governance
Executive Profiles
Risk Management
Dialogue between Outside Directors

Together with local communities
・We will place the highest priority on safety and will aim for zero accidents
and zero disasters.

Sustainability Policy

Shareholders
Investors

Children of
the future

Suppliers［Founder’s Vision］
OOC has always been an R&D-focused organization. The
evolution into our present form began in 1941, when founder
Tatsuo Shizume succeeded in the domestic production of
Canada balsam adhesive used for optical lenses. His aim
was to create a company that would be admired worldwide.
It was an aim he pursued through a lifelong dedication tocreating outstanding chemicals of benefit to consumers andthe world at large. Passion was everything to him. He feltthat outstanding results could arise from the pure applicationof effort. It was this conviction that drove him to work on
bringing value to the world, as he pursued his vision and loveof organic chemistry. We will continue to pursue thefounder’s vision while striving to create new value by looking
ahead to the future.

01

・We value the individuality of our employees and encourage employee
engagement, while aiming for an environment where they can continue tomaintain their physical and mental health.
・We continue to provide materials with unique functions that lead toinnovation and contribute to solving social issues, and strive
to improve our corporate value.
・We place top priority on safety and aim for thesustainable development of society together
with our customers.

Editorial policy
The OOC Group has published a CSR
Report since 2020. From this fiscal year,
however, we are publishing an Integrated
Report that includes financial andnon-financial information, including businessresults and strategies.
It is created with the intention ofcommunicating our value creation in aneasy-to-understand manner to all
stakeholders, including customers,
employees, shareholders, and investors.

Organizations covered
This report covers initiatives carried out by
Osaka Organic Chemical Industry Ltd. andShinko Organic Chemical Industry Ltd. (adomestic consolidated OOC subsidiary).
Some non-consolidated information of Osaka
Organic Chemical Industry Ltd. is also
included.
Time of publication
July 2023

Period covered by this report
The report covers the fiscal year from
December 1, 2021 to November 31, 2022.
Some environmental data includes data forthe administrative reporting period from
April 1, 2022 to March 31, 2023.

Separate Roles for Website and Booklet
Business and Financial Information

Sustainability Information

Integrated Report 2023

Sustainability
WebsiteShareholder andInvestor Information

Financial Results
Annual Securities
ReportThis section introduces our sustainability
activities from environmental, social, andgovernance perspectives. More detailed
and comprehensive information is available.

02

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

E Environment

G Governance

S Society

Data

OOC’s Value Creation

Net sales in fiscal 2022: 32.2 billion yen (new Accounting Standard for Revenue Recognition)

History and Strengths of Value Creation

37.4 billion yen (previous Accounting Standard for Revenue Recognition)

Osaka Organic Chemical Industry (OOC) was founded on a vision of using organic chemistry tobenefit consumers and the world at large.
Today, we continue to honor our founder’s vision as we work to create new value.

Establishment

Acetic esters ⇒Esterification technology

1946

1950

Osaka Organic Chemical Industry Ltd.

Canada balsam
and cedar oil ⇒Distillation/refining
technology

Ability to respond
Automotive paints / Adhesives /Raw materials for UV inkjet inks

1

1970

1980

Raw materials for products suchas photo-curable paints andinks: Viscoat Series

Wide variety / Small quantities

LCD resist products

Strength

In order to respond to each and every detailed
request from our customers, we have aflexible production system that can handle
small amounts of a wide variety of products,
and we have a large number of productgroups that have the top global market sharein niche business areas.

2“IBXA”

Industrialization
using atransesterification
method (such as
THFA; a world-first)
Photo-curable
acrylic acid esters

2010

Strength3

Rapid increase in demand for semiconductor business
Acquisition of cosmetic acrylic resin business
Increase in demand for specialty solvents for electronics materials■ Consolidated net sales■ Specialty chemicals

Technology withunique competitive
advantage

Unique strengths of the
OOC Group that no othercompany can imitate

1

1

No.

No.

share
in Japan

globalmarketshare

Human resource development
through OYPM initiatives(Improving problem-solving skills)
Continuity is power, andthe OYPM initiatives
that have continued
steadily for over 25
years are still evolving.

■ Chemical products■ Electronics materials
Operating profit marginTop-level production technology inthe industry

Supporting
infrastructure
ArF resist monomer, a raw material foradvanced semiconductors

2020

Acquisition of ADAMANTATE businessTechnological strength

Materials for highly functionalized displays

globalmarket
share

03

2000

LSI resist products
Application to the LSI
manufacturing sector

No.

Acrylic resin forcosmetics

1990

Acrylic acids ⇒Polymerization
prevention
technology

We possess a large
number of productswith high global market
shares“4-HBA”

1960
Specialtymethacrylic esters⇒ Application toesterified products

Establishment

1

LCD photospacers

Commercializing
specialty acrylic acid
estersOsaka Yuki Kagaku Kogyosho

Strength

Division intobusiness segments

Raw materials forpharmaceuticalintermediates

1941

Commercialization through mass
polymerization technology(Functional acrylic elastomers)

Full-scale release in
the LCD
manufacturing sector

High quality control technology
We respond with sincerity to
the need for continuation ofbusiness as usual and theincreasing individualization,
sophistication, andcomplexity of customer
requirements.

OOC is the industry leader in acrylic acid ester
production technology (polymerization
prevention and control technology). With boldideas and a passion for manufacturing, weare constantly improving our technology anddeveloping new technologies and products.

The cleanest plant in JapanAll employees participate in 5S initiatives insmall groups, and these initiatives have been
established as business improvement
initiatives. We aim to make our plant thecleanest in Japan, and we are working on
safety, quality improvement, andenvironmental conservation as our priority
issues every single day.

Integrated support capability from
R&D to industrialization
Outstanding ability to make proposals
and solve customer issues
Provision of service solutions basedon research and manufacturing
technologies
Functional representation ofcustomer/client operations

04

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

OOC’s Value Creation Process
Social Environment

Input
As of November 30, 2022

Social issues
envisioned by OOC

Population
declinein Japan● Total assets:

52.8 billion yen● Shareholders’ equity:
40.8 billion yen● Technological capabilities

cultivated through the
manufacture of specialty
acrylic acid esters● R&D expenses:
1.2 billion yen● Number of patents held:
256

Business Model

Strengths(P. 3–4)

Business
Operations

Ability to respond
Wide variety / Smallquantities
From lab to pilot andactual machine
production

Technological strength
Production technology
for acrylic acid esters

Supporting infrastructure
The cleanest plant in
Japan
5S initiatives andbusiness improvement
activities through
OYPM initiatives

Manufacturing
capital
1.1 billion yen

Chemical products
business● Raw materials for paints● Raw materials foradhesives

Electronics
materials business● Display materials● Semiconductor materials

friendly acrylates

Specialty chemicals Development of new
businessbusinesses● Cosmetics materials

where products are
sold: 19

Efficient useof resources

Natural capital● Use of plant-derived

raw materials● Energy consumption:
15,900 KL** Data from April 2022 to March 2023

● Specialty solvents forelastomers

electronics materials● Organicpiezoelectricmaterials

Strategy● New products

Number of launches:
46
Sales ratio (cumulativefor four years): 12.1%

Human capital● Gross profit per

employee comparedto FY2019: +27%

Manufacturing
capital● Effects of PM

Social capital● Refer to “Outcome"Next Stage 10 (NS10)"(from the fiscal year ended November 30,
2015 to the fiscal year ending November 30, 2024)

Medium-term Policy

NS10 Second Five-year
Medium-term Business Plan

● Productivity-oriented resource deployment(from the fiscal year ended November 30,
2020 to the fiscal year ending November 30, 2024)

Society (S)(Social Value).”● Creating a corporate culture that promotes

integrity, passion, and creativity
and solid growth● Company initiatives designed forcoexistence with the planet and the publicSustainableManagement
Environment (E)05Intellectual capital

Profit attributable toowners of parent:
4.7 billion yen

initiatives (individual
improvement /self-maintenance)

Long-term Business Plan

Value creation(Contribution toshareholders)Operating profit:
5.9 billion yen● Functional acrylic● Functional materials

The cleanest plantin Japan● Number of countries

As of November 30, 2022

Dividend per share:
54 yenPayout ratio: 24.9%● Environmentally● PM initiatives:

Social capital

Outcome(Social Value)

Return on equity(ROE): 11.9%● Financial foundation
Equity ratio: 77.3%(P. 17–21)● Capital investment:

Technologicalinnovation

As of November 30, 2022

● Capital efficiency

Human capital
employees: 454

Providing value to the global market as acorporate leader in specialty acrylates

OutputFinancial capitalIntellectual capital● Number of consolidated

Stable supplyof energy

We will place the highest value on each person’s
individuality and will contribute to the developmentof society together with our clients by providing
materials with unique functions.

Management Vision

Natural capital● CO2 emissions

CO2 emission intensity
index of gross profit
compared to FY2013:
39 (a reduction of 61%)

Value creation(Contribution tocustomers and society)
Production ratio of
eco-friendly products(relative to total
production volume): 9%
CSR procurement
Approval rate for our
CSR Procurement
Guidelines (purchaseamount basis): 84%

Value creation(Contribution toemployees)

We lead the world with specialty acrylates

ClimatechangeFinancial capitalManagement Philosophy of OOC

Rewarding workplace
Employee engagement
survey: Rank C(top 30–45%)
Introduction rate of aflextime system: 59%* Excluding shift workers

Governance (G)06Integrated Report 2023

OOC’s Value Creation

Financial Highlights
Operating profit / Operating profit to net sales■ Chemical products business ■ Electronics materials business■ Specialty chemicals business■ Operating profit ● Operating profit to net sales

¥32.2

¥5.9

Operating profit:

billion(billion yen)(billion yen)

40
30
20

6.8

6.3

6.2

10.3

10.6

12.5

12.0

10

11.6

（％）

22.0

18.4

5

4.4

4

12.0

9.8

18.0

16.7
15.5

3.6

3.6

11.0

14.0

12.8

12.5

0
2019

2020

2021

(persons)

454

454

460
447

10.0

2022 (FY)

2018

2019

2020

2021

10

%

1.10
1.01

1.00

0.97
0.94

0.99

0.97

0.91

0.95

0.98
0.90

0.84

0.80

412

410

0.74

0.70

0.68

0.60

390

2022 (FY)(compared to FY2018)

0.90

425

430

CO2 emissions (compared to FY2018):
Reduction of

1.00

435

440
420

persons

2018

2019

2020

2021

2022 (FY)

2018

2019

2020

2021

2022 (FY)Net sales of each segment were strong. Semiconductor materials inparticular continued to drive sales. Due to the application of the
Accounting Standard for Revenue Recognition from this fiscal year, net
sales for the current fiscal year were 32.2 billion yen. (An increase of
7.0% YOY under the previous accounting standards)

While raw material costs and fuel and electricity costs rose, operating
profit was 5.9 billion yen, driven by the strong performance ofsemiconductor materials. (An increase of 1.4% YOY under theprevious accounting standards)

As the business expands, so does the number of employees.

The shift to high-value-added products has led to a reduction in theemission intensity of sales profit.

Profit attributable to owners of parent / ROE

R&D expenses

R&D efficiency

Paid leave acquisition rate

■ Profit attributable to owners of parent ● Return on equity (ROE)■ Osaka Organic Chemical Industry ● Nationwide (Ministry of Health, Labour and Welfare)¥4.72

Profit attributable toowners of parent:(billion yen)

5.0

（％）

(billion yen)

14.0

1.4

4.72

4.99

4.5

12.0

3.5
3.0
2.5

9.7

8.9

10.0

9.9

8.0
2019

2020

2021

4.68

4.68

59.3
57.3

59.1
58.3

58.3
56.3

55

55.6

52.4

2.76

3.00

%

56.6

3.37

1.06

1.0

1.0

60

4.17
4.00

59.1

Paid leave acquisition rate:

times
（％）

1.23

1.21
1.2

51.1

50

2.38

9.0

2.0
2018

R&D efficiency:

billion
5.00

1.28

11.0

3.31

3.03

2.67

¥1.23

(times)

13.0

11.9

4.0

R&D expenses:

billion

13.6

5.5

0.8

2.00

2022 (FY)

2018

2019

2020

2021

2022 (FY)

45
2018

2019

2020

2021

2022 (FY)

2018

2019

2020

2021

2022 (FY)

We strive to increase the paid leave acquisition rate by promoting useof the hourly paid program and other programs.
National average
From the General Survey on Working Conditions [Ministry of Health,Labour and Welfare]In the Medium-term Business Plan, we set a target of “ROE of over
10%” in November 2019. Although the Accounting Standard for
Revenue Recognition is applied from this fiscal year, ROE has
maintained the achievement of its target since the fiscal year ended
November 2021.

R&D expenses have been increasing at an average rate of about 6%
per year.

R&D efficiency shows an upward trend as we have focused our
product development activities on developing high-value-added
products for electronics material applications.
R&D efficiency (times) = Five-year average operating profit / Five-year
average R&D expenses starting from five
years before the relevant five-year period

Trends in shareholder return

Earnings per share (EPS)

Capital expenditures / Depreciation

Rate of taking childcare leave and leave forchildcare purposes■ Capital expenditures (cumulative) ● Capital expenditures (single year)■ Acquisition rate (male)■ Annual dividend ● Total shareholder return ratio ● Payout ratio

Dividend amount:
Approx.
(yen)

5.4

Earnings per share:times (compared to FY2013)

60
50

46.5

40
30
20
10

24.2

10

25.7
10

37.9

36.4

26.4

25

15

27.5

29
30.0

40

36
29.8

46

50

54

（％）

(yen)

70

250

60.7 60
50
40

30.8

24.9

29.2
22.2

30
20
10

0

0
2013

2014

2015

2016

2017

2018

2019

2020

2021

2022 (FY)The annual dividend has continued to increase over the past eight
years, and the dividend amount has increased approximately fivetimes. (compared to FY2013)

07

Data

■ CO2 emissions ● CO2 emission intensity of gross profit compared to FY2018● CO2 emission intensity of production compared to FY2018

400

3
2018

S SocietyCO2 emissions

450

5.9
15.2

14.5

Number of employees

Total number of employees:

billion

5.9

5.8

6
8.4

E Environment

G GovernanceNon-Financial Highlights

Net sales

Net sales:

Promoting
Sustainable Management¥217

Capital expenditures:(billion yen)

226

217

200
150
91

100
50

● Depreciation

41

39

97

121

137

57

2015

5

2016

2017

2018

17.4

2019

2020

2021 2022 (FY)

Earnings per share have trended upward over the past decade.

（％）

100

100

100

100

100

100

％

100 100

80

10

0
2014

19.9

20

Acquisition rate:billion

15

150

0
2013

¥7.5

■ Acquisition rate (female)

4.7

6.4
4.7
2.0

2020

2.4
1.6
2021

60

9.8

7.5

44

40
2.3
1.1

2022

2.5
2023
Forecast

3.2
2.5
2024 (FY)Plan

The Medium-term Business Plan envisions a total capital expenditureof about 20 billion yen from FY2020 to FY2024.
A total of over 10 billion yen is planned to be invested for the remaining
two years from FY2023 to FY2024.

18

20
0

0
2018

4
2019

2020

2021

2022 (FY)

When a child is born or when an application for childcare leave ismade, we provide guidance on how to take childcare leave throughinterviews.
With the revision of the Child Care and Family Care Leave Act in
October 2022, a new program, “Postpartum Father’s Childcare Leave(Childcare Leave at Birth),” was established. In response to this, wehave also revised our regulations to create an environment that makes
it easy for employees to take childcare leave.

08

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

OOC Products Used in Everyday Life

Our Products Are Invisible, but Used around You

11:42 AMNO SIM

August, 31

100%

Los Angeles, CA

Mobile terminals (displays)

TVs and PCs (displays)

Raw materials for color filters,
adhesives, coatings, and othermaterials essential for productmanufacturing

Raw materials for color filters,
adhesives, coatings, and othermaterials essential for productmanufacturing

CLOUDY
MAX

29

MIN

REAL FEEL

31

17%

7 m/s

September, 130

18September, 225

19

September, 3

22

15

VR goggles
Raw materials for the display
components of VR goggles,
such as light control films andholographic optical elements

19

Onboard vehicle
monitors

Monitoring cameras(rear-view monitors)

Raw materials for onboard
electronic device displays andintegrated circuits

Raw materials for soil-resistant andanti-fogging processing for lenses, etc.

Vehicle top coats
Environmentally friendly andsoil-resistant raw materials thatprovide the ability toautomatically repair small
scratches

Wraps

Commercial
refrigerator
showcases
Raw materials thatprevent fogging of
showcase doors

Raw materials for UV
inkjet printer ink for
printing on 3D objects
and curved surfaces,such as trains and
buses

.

IC

AK

OS

AN
RG

L
ICA

TD
YL
TR

US

IND

EM

CH

AO

Raw materials for nailproducts that harden
quickly by being exposed
to light for energy-saving
purposes

Raw materials thatprovide contact lenses
with oxygen
permeability andwettability

RNBO

Gel nails

Contact lenses

Household printers
Solvents that adjust the surface
tension of water-soluble inkjet
printer ink

RE

Surveillance cameras

IUM

AR

U
AQ

Providing soil-resistantand anti-fogging
materials

Paints for the bottoms of ships
Providing materials for paints used to prevent theadhesion of barnacles

Cosmetics
Hair care products
Raw materials thatprovide products withthe ability to stiffen hairand add volume

Raw materials that help
suppress odors, provide
moisturizing and antibacterial
effects, and do not require
the use of paraben

Medical andsurgical tapes

Masks andprotective wear

Protective
eyewearRaw materials forprocessing the surface ofmasks for repelling waterand oilRaw materials forsoil-resistant andanti-fogging processing

Raw materials used foradhesives for fixing
bandages, gauze, andother dressings to affected
areas

on

chemizCardboard
Raw materials forplastic sheets thatenable printing on
uneven surfaces

Bathroom mirror films
Raw materials for anti-fogging
and soil-resistant processing

09

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Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Top Message

We will realize sustainable growth for the long term
as a company that contributes to solving social
issues by demonstrating the power of chemistry
unique to our company.
So far, we have communicated our business activities
and have demonstrated our role as a company that
contributes to society to our stakeholders through the
publication of CSR Reports. From this fiscal year, we will
publish an Integrated Report to provide information on
our initiatives for value creation and medium- tolong-term sustainable growth by reporting on our current
financial and non-financial status. Since this is the firstyear of publication, I would like to inform you about ourcurrent management status and issues, including mythoughts, as a member of the top management, on
Osaka Organic Chemical Industry Ltd. as a company

A year of further focusing on
customer-oriented sales and development
amid market turmoil
First of all, looking back at 2022, I found that it was a year in which thedistinction between business fields became clear. In the past few
years, raw material and fuel costs have soared against the backdrop of
the COVID-19 pandemic and geopolitical risks. Consequently, the raw
material field for automobile-related paints and the flat display field
were directly affected by this. Meanwhile, demand expanded insemiconductors, especially in the cutting-edge fields, due to progress
in ICT, although the market was said to be in an adjustment phase.
In addition, the year 2022 was characterized by extremely uncertain
trends in overseas markets. We had thus far successfully exported our
products to the European and U.S. markets. In 2022, however, due tosupply chain turmoil, it continued to be difficult for us to know where
and how much inventory was available for our customers’ products,
which interfered with the shipment of our products.
Under these difficult circumstances, we have strived to expand
demand with one-on-one business development, or customer-oriented
sales and development, as our strength. As part of our efforts, we havecooperated with our customers in various fields, especially in areas
where they are more advanced. This has resulted in opportunities for
us to create cutting-edge materials. Although demand forgeneral-purpose chemicals fluctuated wildly due to turbulence in themarket, we were able to do business largely unaffected by thisturbulence by providing value in our products that only we could
create.
Moreover, in addition to electronics materials, which have been making
up an increasing proportion of our products in recent years, we provide
materials that can be used as raw materials for various resins that
support our lives in the fields of hair care products and housing
construction materials. Accordingly, even if one business struggles, we
can supplement our earnings with products in other fields. I believethat this is one of the factors that enabled us to overcome this difficult
year.

Record-high profits achieved while
maintaining a double-digit ROE

Masayuki Ando
Representative Director and CEO

11

Although fiscal 2022 was a tough year, we were able to achieve a newrecord high for operating profit, while increasing the dividend for the
ninth consecutive year. In addition, through continued efforts toimprove ROE (return on equity attributable to owners of parent), which
is one of our key management indicators, we achieved an ROE of
11.9% in the fiscal year ended November 30, 2022, reaching the
double-digit level, which has been set as our target in the Second
Medium-term Business Plan.
For the most recent results by segment, we have achieved goodresults in the chemical products business by concentrating
investments on carefully selected categories to renew the productlineup. While discontinuing the handling of products with low
profitability or insufficient competitiveness, we have expanded thefields in which we excel. Meanwhile, in the electronics materials
business, we have strived to strengthen the development of
next-generation semiconductor materials and expand sales of new
display materials while being supported by the development of thedigital industry. The market for these businesses has grownsignificantly over the past few years. In the specialty chemicals

business, we have worked to promote the development of functional
polymers and expand sales of cosmetics materials and high-purity
specialty solvents. One of the most significant achievements in thisbusiness was the acquisition of the acrylic resin business for cosmetics
from Mitsubishi Chemical Corporation in 2020, which enabled us todevelop a route for selling products to the global market. Although oursales were limited to the domestic market in the past, I expect that wewill be able to develop our business with an eye on the global market
in the future.

A corporate culture that honestly
responds to customer issues as the
backdrop to the development of highly
profitable products
One of the factors that has enabled us to do business unaffected byturbulence in the market, which I mentioned at the beginning, is ourhistory of taking on the challenge of developing products in line withgrowth fields in each era since our founding. When established
immediately after World War II, our company was a manufacturer thatmainly produced acetic esters used in paint solvents. Since then, we
have refined our organic synthesis technology for making
polymerization inhibitors through challenges such as becoming Japan’s
first domestic production of acrylic acid. Later, we started
manufacturing pharmaceutical intermediate materials, and thetechnology cultivated through this business has led to the developmentof our current unique technology in the semiconductor field.
In my opinion, our strength in research and development is that wehave valued opportunities in each era, rather than aiming at
development in just one particular field. As I mentioned earlier, ourcompany is characterized by customer-oriented sales anddevelopment. We have placed importance on honestly responding tocustomer issues and requests through close relationships with them.
Before we knew it, we were often involved in development in the
cutting-edge areas pursued by our customers. It can be said that ourserious response to such development has led to our businessdevelopment up to the present. Although considering profitability andgrowth potential as corporate managers, we have basically shared thedesires of our customers, with the thinking that although theconsequences are unknown, this is a development in an interesting
field, so we will work on it to meet their expectations.
Among the roughly 500 different types of products that we have today,
some products are manufactured in extremely small quantities with alot size of only a few kilograms despite the fact that it takes a lot oftime and effort to manufacture them. Although it may be pointed outthat we are running an inefficient business as a chemical manufacturer,
the spirit of craftsmanship is rooted in our company, where evensmall-lot products should be carefully manufactured to meet customer
expectations. This is the foundation of our position as a corporate
leader in specialty acrylates. In our company, we call the manufactureof small-lot products “takumi” (craftsmanship). While we naturally
promote the automation of processes at manufacturing departments,
for small-lot products, skilled operators carefully finish each item. Suchhigh manufacturing capability at manufacturing sites is also one of ourstrengths. In addition to customer-oriented research and development,
we have been steadily pursuing our unique production maintenanceactivities, the OYPM (Osaka Yuki Productive Maintenance) initiatives,
for a quarter of a century. We have continued to work on these
initiatives throughout the company under the slogan of “the cleanest

12Integrated Report 2023

plant in Japan” based on the 5S principles (Sort, Set in order, Shine,Standardize, and Sustain). This has improved the ability and quality
awareness of each employee, which in turn has led to thedevelopment and stable supply of products that meet customer
expectations.

A new plan being formulated as a resultof achieving the Long-term Business
Plan targets ahead of schedule
Our current business performance is trending favorably, and at thesame time, our Long-term Business Plan is progressing at a paceexceeding the initial estimate. Since we launched “Next Stage 10,” along-term business plan covering the 10-year period that began withthe fiscal year ended November 2015, we have implemented various
measures to accomplish the targets of this plan. As a result, it was
expected that the targets would be achieved at an early stage, and werevised our targets in fiscal 2018. In addition, for the NS10 Second
Five-year Medium-term Business Plan covering the period from thefiscal year ended November 2020 to the fiscal year ending November
2024 as well, which we are currently implementing, we have achieved
all key management indicators two years ahead of schedule.
Accordingly, we are now formulating a new long-term business plan.
In this new business plan, we will set targets at least for 2030, andpossibly for 2050, aiming for sustainable growth over the medium tolong term, thereby hoping to meet the expectations of our investors. It
is said that an invisible wall stands in the way of a company’s growthwhen it comes to the scale of sales. One of our goals will be to breakthrough the sales barrier of 50 billion yen through business expansion
while maintaining our current high profitability.
Going forward, we will continue to focus on our stakeholders, and at
the same time, seek to retain earnings for investments for future
growth and improve the treatment of employees, who are working
hard to enhance our business performance. Through suchwell-balanced capital allocation, we aim to achieve sustainable growth.

Pioneering difficult fields that othercompanies cannot handle, without
flinching from failure
In order to achieve sustainable growth in the future, it is important tofurther develop the creativity that we have cultivated since ourfounding. One of the organizational strengths of our company is that
we have an environment where we can take on new challenges under

13

OOC’s Value Creationa free atmosphere with no barriers between employees. We are also
good at perceiving the trends of the times and moving agilely. Looking
back on our history, we have seized opportunities in growth fields ineach era, such as industrial products, pharmaceuticals, andelectronics materials. During that time, we have experienced many
failures. However, the fact that we have continued to take onchallenges without flinching from failure has resulted in the trust that
our customers place in us today.
Although we have found our way in various fields, we have not goneblindly. Our founder, Tatsuo Shizume, taught us to “pursue
high-value-added products through the development of beneficialorganic chemical products.” Based on this teaching, we havedeveloped highly profitable businesses through the development of
products that other companies do not handle in any field.
Our acrylic acid ester for photoresists used in a lithographic exposure
process for semiconductors, which is one of our main sources of
earnings, has a market share of approximately 60%. The
manufacturing process is extremely complicated, and it is not easy tostably supply high-quality products. The manufacture of this productcan only be achieved through customer-oriented sales, research anddevelopment, and the relentless pursuit of manufacturing on the shop
floor. Furthermore, quick decision making in management, such as on
the restructuring of organizations and the propriety of certain
investments, is also a strength in building a competitive advantage inthe market.
The high degree of openness within the company, theinter-departmental collaboration born from this, good footwork, andquick decision making are the foundations of value creation at Osaka
Organic Chemical Industry. This corporate culture should be adhered
to even as we expand our business in the future.

Aiming to create a fourth portfolio by
taking on social issues
Looking at existing businesses, we expect growth in monomers for
EUV (extreme ultraviolet), which are suitable for writing finer circuits on
substrates in the field of semiconductors. In the chemical products
business, since we receive many requests for monomers in the
non-petrochemical area, we will refine our technology so that we cancreate many products in the future.
Although we have had limited opportunities to talk directly with ourcustomers due to the COVID-19 pandemic over the past few years,
we have actively worked on the development of new products. We
have launched non-petrochemical products on the market in thechemical products business and have developed several materials for
non-liquid crystal applications in the electronics materials business.
Moreover, in the specialty chemicals business, there are products
other than hair care products for which we could develop a market.
This situation is very favorable to management.
Meanwhile, as a challenge for further business expansion, we need tofocus more on creating new businesses and improving technology.
The business environment has changed significantly since weformulated “Next Stage 10” approximately 10 years ago. In terms ofmarket changes, it has become essential to take on the challenge ofaddressing social issues, such as decarbonization and energy saving.
Our products related to these issues include sensor-related products
and energy conversion materials. As the demand for these products is
growing rapidly, it is becoming more and more important for us to takeadvantage of our good footwork to respond agilely. In this context, I
am fully aware that the major mission of management is to create afourth portfolio following the chemical products business, theelectronics materials business, and the specialty chemicals business.
Furthermore, although we currently claim to be a corporate leader in
specialty acrylates, I believe that creating opportunities in fields otherthan acrylic acid is also important in terms of business expansion.
In order to sustainably expand our business in the future, it isnecessary to create product groups that can be used not only in

Promoting
Sustainable Management

Japan but also around the world and to build overwhelming
production technology that can be used in the global market.
Differentiation in R&D and production technology is a big challenge inthe medium to long term. In fiscal 2022, we established a liaison officein South Korea, thereby taking a new step forward in overseas
expansion following that in China. In the future, we will consider
expanding into the U.S. and other countries.

Making fiscal 2023 a year to review ouroperations for new growth
While we believe that we have cleared the way for sustainable growthover the medium to long term, we are determined to persevere in fiscal
2023. The semiconductor market is expected to cool down in reaction
to the special demand caused by the COVID-19 pandemic, and there
are concerns that rising raw material and fuel costs will put pressure
on profits. Consequently, there is a possibility that the steady increasein sales and profits that has continued for the past few years will cometo an end. Nonetheless, rather than simply hunkering down and simply
persevering, we would like to view the lull in performance as anopportunity to review the way in-house operations are conducted,
thereby further eliminating operational waste and improving efficiency.
As a chemical manufacturer, safety is our top priority. Accordingly, themaintenance of production equipment that has been in operation for along time is also an important action that we should take.
In addition, while aiming for new growth on this occasion, we will also
focus on issues related to sustainability, such as employee education,
improvement of the working environment, and responding to diversity.
By accumulating organizational strength through these initiatives, wewill move forward toward new growth.
In this harsh market environment, I would like to talk about one
positive topic. During the two years of the COVID-19 pandemic, we
formulated a recycling plan for our production plants to cut costs,
reduce energy consumption, and curb greenhouse gas emissions. As
part of these activities, we have invested in initiatives such as theinstallation of boilers that use used solvents and reusing used solvents,
which are already in progress. We expect that these initiatives will
provide an opportunity to respond to social issues in the energy field in
the future and contribute to our future growth.

Further promoting human capitalmanagement while leveraging theculture we have cultivatedUp until now, as stated in our Guidelines for Conduct, we have placed
importance on dealing with all stakeholders with sincerity and humility.
This is a set of values to which we should continue to adhere in the
future. We always respond honestly to customer requests. We
naturally meet the expectations of our investors and shareholders. We

G Governance

E Environment

S SocietyData

are sincere in our dealings with local residents. We disclose necessary
information as appropriate. Each of us, including all employees andmanagement, will fulfill our mission with the awareness that society isalways watching us. In the first year of issuing the Integrated Report, I
would like all of us to reaffirm that fulfilling our responsibilities as acompany in this way serves as the foundation for achieving sustainablegrowth.
Further fostering a sincere and humble corporate culture is essential
for strengthening human capital management. Recruiting, educating,and promoting human resources is one of our most important issues.
It is my belief that creating a work environment where each and every
employee can work comfortably, both physically and mentally, over thelong term is essential for creating products with unique value.
In particular, people working at production sites are more likely to be
employed from communities near plants, and so they are both
employees and members of the local community. It is precisely
because these human resources are engaged in production activities
with a high awareness of manufacturing that we are able to stably
produce high-quality products with complex production processes.
One of the things that I am proud of as a manager is that our company
has a low employee turnover rate. This trend is not limited to businesssites in Japan, but is also seen at overseas bases, such as a sales
company in China that has long-term employees.

Chemistry is a “science of change” fullof business potential
As I mentioned in last year’s CSR Report, when we pursue growth asa corporate entity, it all boils down to how we improve each individual’sesthetics. To this end, it is essential to maintain and improve a clean
production site through 5S initiatives. As personal esthetics areenhanced through work, this naturally improves one’s sense of ethics
as a person. This eventually serves as a deterrent to misconduct in theorganization.
We aim to create an organization rich in psychological safety by
improving personal ethics through work, thereby encouraging
employees to respond sincerely to others. I believe that it is the duty ofmanagement to pursue a company where each and every employee
can feel that it is fun to work at the company and that they can growthrough their work, while trying to improve the treatment of employees.
As someone who was originally a researcher, chemistry is a very
interesting field for me, as it is said to be a “science of change,” and isfull of business potential. I would like all employees, including new
employees, to feel this first hand.
When I imagine the future of Osaka Organic Chemical Industry, I thinkthat it is a really exciting company. Looking at the market environment,in the field of mobile communication, mobile communication standards
are evolving to 5G and 6G. In the field of automobiles, electric vehicles
and self-driving technology have made dramatic progress, and evenflying cars have appeared. Meanwhile, there is an urgent need toaddress global warming, including environmental and energy issues.
With all things considered, it is the power of chemistry that greatly
contributes to the advancement of technology and the resolution ofsocial issues. If our company can play a part in that, we can only lookforward to it. Of course, we are fully aware that it is not easy to turnbusiness opportunities into business realities to pursue profitability.
However, I am confident that we will be able to open up a bright futurefor our company if each and every employee, led by management,honestly responds to customer requests while enjoying their work.
Going forward, we intend to make even more proactive efforts todisclose information to investors and other stakeholders through the
publication of Integrated Reports and other means. Meanwhile, thevalue and attractiveness of Osaka Organic Chemical Industry cannot
be expressed in numbers alone. Now that the COVID-19 pandemic is
winding down, we hope you will deepen your understanding of ourbusiness by experiencing it on-site through plant tours and otheropportunities. We look forward to your continued support in the future.

14

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Medium- to Long-term Business Plan
Next Medium-term Business Plan

We started formulating a new Medium-term
Business Plan, aiming to realize asustainable society andfurther develop our group.
Tetsuya Watanabe

In light of the fact that we achieved the numerical targets
announced in the current Medium- to Long-term Business Plan
(NS10) ahead of schedule as well as a change in accounting
standards to conform to the Accounting Standard for Revenue
Recognition, we had repeated discussions to revise the numericaltargets. As a result, instead of revising the figures, we decided toterminate the current Medium-term Business Plan without waiting
for the final fiscal year (FY2024) and to start the new
Medium-term Business Plan one year ahead of schedule. We
launched a project consisting mainly of young members who willlead the next generation and are currently formulating a new
Medium-term Business Plan. With this plan, we intend todemonstrate our strong will not only to further expand ourbusiness performance but also to proactively address social
issues, such as the declining birthrate, the aging population, anddiversity and inclusion, in addition to the aforementioned carbon
neutrality, in order to realize a sustainable society. The results ofand experience with NS10, which led to great achievements,
gave the company and me tremendous confidence. I was
involved in the plan from its formulation process. We will achieve
the plan that we created ourselves, and then we will create aneven better plan and pass it on to the next generation. I definitely
want as many of our employees as possible to have this kind ofexperience in this project.

Director, Corporate Officer,
General Manager of Corporate Planning Division
NS10

Current long term

NS10 First MTBP

Current medium term

NS10 Second MTBP
Next
□□
plan
△△
formulation△△ First MTBP△△ Second MTBP
PJ

Next super-long term
Next long term

Medium- to Long-term Business Plan Next Stage 10
We formulated a 10-year Medium- to Long-term Business Plan
(NS10) starting from the fiscal year ended November 30, 2015,and have been working on R&D, market cultivation, production
system reinforcement and management foundation reinforcement.
As a result, since we expected to achieve our originally set sales
and operating profit targets ahead of schedule, we revised ournumerical targets upward twice, in January 2018 and November
2019. Then, we formulated the NS10 Second Five-year
Medium-term Business Plan (MTBP) starting from the fiscal year
ended November 30, 2020 (from the fiscal year ended November
30, 2020 to the fiscal year ending November 30, 2024), aiming for
further business expansion and higher profitability. In this Second
MTBP, in addition to consolidated net sales and consolidated
operating profit to net sales ratio, our group positioned ROE (returnon equity attributable to owners of parent) as a key businessindicator and set the following targets for the key indicators.

In recent years, there have been major changes in the businessenvironment, including the COVID-19 pandemic, strained
relationships between the U.S. and China, and the worsening
situation in Ukraine. Even in this situation, we implemented
various measures based on our Medium-term Business Plan,
including acquisition of a hair cosmetics materials business,aggressive capital investment in the semiconductor-related
business and establishment of a Korea Office.
As a result, we steadily expanded our business performance andachieved our targets for FY2024 two years ahead of schedule.
(The sales were calculated based on the previous accounting
standards.) With NS10, we are now more prepared than everbefore to tackle various issues from a medium- to long-term
perspective.
We have made dramatic progress in product consolidation,
flexible production system establishment and cost reduction,
which would have been difficult to achieve by short-term
activities, leading to the realization of high profitability.
Furthermore, we have been vigorously promoting initiatives onenvironmental issues, including the realization of carbon neutrality,
which is an urgent and critical social issue. For example, we
believe that we have been taking prompt measures to makevarious facilities more energy efficient and use renewable energy
at plants, add biomass acrylates to the lineup in the sales field
and begin acquiring new technologies that will significantly reducecarbon dioxide emissions in the research field.

Changes in Medium- and Long-term Targets
Initial target

Revised target

Second MTBP target(Announced January 2015) (Announced January 2018) (Announced November 2019)(New accounting

ーーー
standards)
Net
sales (Previous accounting ¥30.0 billion or more ¥35.0 billion or more ¥37.0 billion or more
standards)
Operating profit
Operating profit to
net sales ratio¥3.0 billion or more ¥3.5 billion or more

¥5.0 billion or more

10% or above

10% or above

13.5% or aboveーー

10% or above

ROE

NS10 (from FY11/15 to FY11/24)

Next medium term

SDGs

Event
2015

2019

2020

2023

2024

2026

2027

2030

100th anniversary
since foundation

2041

100th anniversary
since establishment

Carbon neutrality

2046

2050 (FY)

Digital Transformation (DX) Initiatives
We have been actively introducing and utilizing IT. As a result, wewere able to go beyond mere operational improvements, such asincreased work efficiency and accuracy through the use of digital
data, and quickly expand into the analysis of quality andproduction data. We believe that this has contributed greatly tothe huge strides of our semiconductor-related business, which
requires strict production control.
Furthermore, since we introduced TV and web conferencing
systems and a remote work system significantly early on, we wereable to respond quickly to emergencies during the COVID-19
pandemic, such as employees being forced to telecommute or
unable to go on business trips. These systems not only helped tocontrol the spread of infection but also contributed greatly to thecontinuation of order receipt, production and other operations
without delay as well as a stable supply. They are also linked tothe promotion of work style reforms for employees.
In the meantime, to maintain global competitiveness and create
further value for differentiation, we must go beyond this mere useof IT to promote DX. Therefore, in December 2021, we moved ourIT department to the Corporate Planning Division in order toestablish our DX promotion system. At the same time, we also
appointed a Manager in charge of DX. We have set up a system
to consolidate company-wide information on digitization and IT
with the Manager in charge of DX, who will take the lead incarrying out various projects.
In August 2022, we formulated our “DX Policy” to show internallywhat DX is and what our priorities are within the company. At thispoint, we are still in the trial-and-error stage; however, bypromoting digitization for overall optimization and effectively
utilizing resulting data, we hope to create value for differentiationthat is unique to our company by developing new materials andproviding ultra-high-quality products. In particular, in order tomaintain our competitiveness in the electronics materials
business, where technological innovations are remarkable, we are
eager to do whatever we can do, from the review of our coresystems to accumulation and analysis of quality andmanufacturing data and practical use of Materials Informatics.

- DX Policy - (excerpt)
To enhance resilience and attain sustainable development, our group will achieve the following items through the use of digital technology.

Changes in Long-term Performance
Medium-term Business Plan target: 10.0% achieved■ Net sales ■ Operating profit ● Operating profit to net sales ratio ● ROE(billion yen)

Ito Review target: 8.0% achieved

35
30
25

22.5

23.7

23.7

20

10.4

15
5.3

5.7

1.1

3.8 1.3

2013

2014

10
5
0

23.5

4.2

6.7

26.5
12.1

1.5

2.4

2015

2016

2017

5.3

28.6

12.5

16.7

18.4

13.6

11.9

5.8

5.9

9.9

8.9

9.7

3.6

3.6

4.4

2018

2019

2020

25
20
15

12.8

10
5
0

* The “Accounting Standard for Revenue Recognition,” etc. has been applied since the beginning of the fiscal year ended
November 30, 2022.

15

（％）

32.2

28.6
15.5

7.7
3.2

7.8

29.2

35.0

2021

2022 (FY)
Accounting Standard for Revenue Recognition applied

1. Safe operations
Eliminate problems and errors to achieve safe operations.
2. Promotion of new product development
Promote the development of new products through theintroduction of Materials Informatics (MI) and other advanced
technologies.
3. Increase in productivity
Increase productivity and improve the company’scompetitiveness. Furthermore, achieve a work-life balance byimproving work efficiency to reduce workload.
4. Improvement of quality
Improve the accuracy and quality of deliverables through theuse of digital data.

5. Reduction of environmental burden
Obtain data affecting the environment in real time to strive to
reduce environmental burden by GHG emissions control andother means.
6. Promotion of diversity
Create a comfortable work environment for everyone byintroducing AI, robots, etc.
7. Reinforcement of supply chain management (SCM)
Promote IT across the entire supply chain to reinforce SCM.
8. Streamlining of sales activities and reinforcement ofmarketing
Strive to improve and optimize the efficiency of sales
operations. Furthermore, quickly grasp changes in customer
needs and provide new value to customers.

16Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Business Domains of the Osaka Organic
Chemical Industry Group
Chemical Products
Business

Message from Corporate Officer Responsible for Business Operation

Based on acrylic acid esters, we provide materials
that serve as raw materials for a variety of resinsthat support our daily lives.

[Products]
Raw materials
for paint

They are used in automotive, smartphone and other applications and can
impart high reactivity, high adhesion and other functions that cannot be
achieved with general-purpose products. Due to their high purity, they
have low coloration, low viscosity and other advantages.

Raw materials
for adhesives

They can be used for regular solvents as well as UV-curable andanaerobic adhesives. Other advantages include low coloration, lowviscosity and low odor, similar to those for paint.

Environmentally As part of our initiatives to help achieve the Sustainable Development
friendly acrylates Goals (SDGs), we are developing acrylates made from biomass-derived(plant-derived) or recycled raw materials.

Motomi Ogasahara
Director, Corporate Officer, General Manager of Business Operation Division andManager of International Business Department[External environment and company status]

Raw materials for paint

OOC’s status
Opportunity

R
Biomass acrylates

Business domains

Development materials● 1950Chemical productmarketPhoto-curable
coatings, rawmaterials for inks
and the like, adhesives

Distillation technology, polymerization
prevention technology
High purification technology

Polymers for electronics
materials
Photoresists● 1990● 1980

Healthcare market
Polymers for hair care products
Raw materials for pharmaceuticalintermediates

Polymers for LCD
Resists for PS

Application of technologies to products

Ultra-pure monomers
Functional acrylic
elastomers● 2010Organic piezoelectricmaterials● 2020Chemical products

Shape control
technology
Physical property
control technology
Assessment
technology●● 2023–●

UV inkjet materials
Biomass acrylates (target ratio: 100%)17

Semiconductor and sensor market

We are implementing product consolidation as a measure to improve the profitability of
unprofitable items.
To make inroads into new markets and create environmentally friendly products, we havelaunched biomass acrylates (Viscoat #E series), low CO2 emissions products.

Net sales

Operating profit / Operating profit to net sales ratio(billion yen)

Operating profit (billion yen)

16
12.0

12.0

11.6
9.8

20.0

3

15.0

11.0
2
1

4
0

2019

2020

2021

0

2022 (FY)

Accounting Standard for
Revenue Recognition applied■ Net sales

Assets / ROA

Market launch

5.2
0.63
2018

6.8

6.6

0.79

0.64

2019

2020

7.8

7.4

10.0

0.93

0.81

5.0

2021

2022 (FY)0■ Profit ● Profit to net sales ratio

Capital expenditures / Depreciation
ROA（％）

Assets (billion yen)

40.0

Cosmetics materials● Application development for hydrophilic polymers

15

30.0

10

20.0

Capital expenditures (billion yen)

Depreciation (billion yen)

3

1.5

●

Monomers for EUV● CMP slurry additives● Materials for optical waveguideLife science market

2018

Operating profit to net sales ratio (%)

4
12.1

20

Resists for μLED
● Materials for phase difference● Polymers for sensors●

Biomimetic acrylates● Functional acrylic elastomers● Organic piezoelectric materials●●●[Medium-term plan]5

New businesses●●

We will build an absolute position in the global market for specialty acrylic acid esters byconcentrating our resources on high-purity products that stand out due to our outstanding
distillation and purification technology and by continuously launching new products utilizing
our organic synthesis technology.

Specialty chemicals●

Future promising markets

Many new applications originating overseas
Vulnerable to exchange rate fluctuations
Response to foreign-currency advancepayment transactions● Compliance with local laws and regulations
in overseas countries●[Strategy]

Please refer to the website for details of the products.
https://www.ooc.co.jp/products/chemical/

Electronics materials

Monomers for ArF and EUV

Decarbonization market

Strengthening of overseas sites
Import of biomass materials and bionaphtha● Unclear concept that “CO2 emissions
reduction leads to increased customer value”●

OOC’s core products

Resists

Semiconductor market●●

Reference values calculated based on the previous accounting standards

Polymer reaction technology
Polymer design● 2000

LCD market

Creation of biomass-based products● Delving into existing technologies deeper● Adaptation to decarbonization process● Rollout of technologies to other fields

Polymers

Hydrophilic polymers●●

Monomers

Photo-curable
monomers● 1970Intended future technological development

Price offensive by China and Korea
Technology leakage● Compliance with CO2 emissions regulations●●

8

Fundamental technologies

Acrylic acid esters● 1960Market launch of new biomass acrylates
Downstreaming of applications● Low CO2 emissions monomers●

WeaknessO

12

Development of In-house Technologies

External environment

Osaka Organic Chemical Industry has three business segments:
chemical products, electronics materials and specialty chemicals.
In the chemical products business, we offer acrylic acid esters
that add functionality to automotive and architectural paint,
photo-curable printing inks and coatings, and specialty adhesives
for displays.
Products that we offer in the electronics materials businessinclude resists used in the manufacture of liquid crystal displays(LCDs) for televisions, PCs, smartphones and other IT devices,and monomers for semiconductor resists, which are essential forthe manufacture of advanced semiconductors, the brains andmemory devices needed to run electronic devices.
Products that we offer in the specialty chemicals business include
resins used in hair gel, hair wax, shampoo and other cosmetics,
moisturizing ingredients for skin care cosmetics, special solvents
for water-based inkjet inks, and hydrophilic coating materials toprevent lens fogging and fouling.
Our business areas are significantly broad and diverse, and all ofour products are indispensable to our daily lives even thoughpeople rarely see them directly. While digitization and IoT areaccelerating around the world, efforts are also needed to address
climate change, reduce energy consumption and solve othersocial issues.
In this context, in the field of electronics materials, advancedO

Strengthsemiconductors that achieve high-speed processing of hugeamounts of data with low power consumption are necessary forthe further evolution of AI and digital control technologies andtheir widespread implementation in society. As advanced
semiconductors are becoming increasingly finer patterned andpackaged in high densities, manufacturing them requires a stablesupply of high-performance, high-quality materials. We arecommitted to meeting our customers’ expectations through thedevelopment and stable supply of a variety of materials.
Furthermore, the use of petrochemical feedstocks, which are
fossil resources, produces carbon dioxide gas, which contributes
to climate change. In the chemical products business, we provide
specialty acrylic monomers to ink, paint, adhesive and various
other fields. While shifting raw materials for these products fromconventional petrochemical-based to biomass-based, we willcontinue to strive to realize a sustainable society by taking on thechallenge of achieving carbon negativity through process andother technological innovations in the future.
In the cosmetics field of the specialty chemicals business, weplace the highest priority on providing high-quality, safe andreliable cosmetics materials. We will continue to create productsthat make people happy, rich and impressed and deliver themfrom Japan to the world.
Osaka Organic Chemical Industry will continue to develop
products that are never seen but meet our customers’
expectations and contribute to a sustainable society.

Business domains

Threat

0

7.6

7.4
8.5
2018

7.0

6.7
10.4

2019

■ Assets ● ROA (Return on Assets)

9.6
2020

13.3

6.9
11.7

10.0

2

1.0
0.74
0.55

1

0.6

1.09

2021

2022 (FY)

0

0.61
0.5

0.77
0.15

0

0.7

2018

2019

2020

0.04

0.08

2021

2022 (FY)0■ Capital expenditures ● Depreciation

18

Integrated Report 2023

OOC’s Value Creation

Electronics
Materials BusinessWe develop photo-curable resists, such as patternable materials and opticalmaterials for displays and sensors with advanced functionality, as well as
polymers for these resists.

Semiconductor We are developing new, high-quality acrylic monomers, including adamantyl
materials
monomers and lactone monomers, which are raw materials for resists used for

Functional
materials

manufacturing semiconductor materials.

[External environment and company status]
OOC’s status
Opportunity●●

Reinforcement of development of next-generation
display and sensor materials
Rapid development of innovative new products in linewith customer demand

Proposal and development of environmentally friendly
resists and other materials
Flexible material proposals and development of new
applications by leveraging our ability to handle
integrated production from raw materials

Semiconductor materials●

Display materials●

Cosmetics materials

Semiconductor materials
Display materials

Development of raw material suppliers that are notdependent on specific countries
Promotion of consolidation of general-purpose
LCD-related materials
Establishment of global alliances
Niche strategy for gaining benefits as remaining players

Semiconductor materials●

Tools for gathering information overseas
Rise of alternative technologies

Semiconductor materials

BCP (production, raw materials and products on consignment)
Raw materials dependent on specific countries

Displaymaterials

By utilizing our high quality control capabilities and core technologies developed in
the existing business, we will further increase the ratio of high-value-added
products in the existing business, expand new applications, develop
next-generation materials and roll them out to peripheral materials.

Semiconductor We will promote the development of new products and the enhancement of thecompetitiveness of existing products by leveraging our synthesis, production and quality
materials

Please refer to the website for details of the products.
https://www.ooc.co.jp/products/electronic/

control capabilities and our production flexibility, ranging from small-lot to mass production.
Furthermore, we will promote the capturing of new needs arising from generationaltransitions and application developments, as well as the rollout to peripheral materials.

Please refer to the website for details of the products.
https://www.ooc.co.jp/products/function/

Numerous competitors
Change in market trends● Environmental issues
●

●

●
●

●

Overseas network
Assessment technology for end-use
applications

Stricter management ofchemical substances● Environmental issues●[Medium-term plan]
In the area of cosmetics materials, we will offer products that are in accordance with the trend
to use paraben-free and sulfur-free products. We will also strengthen our sales network in
ASEAN and other Asian nations that have high market growth rates to develop products
tailored to the needs of each region.
In the area of functional materials, using specialty acrylic acid esters, we will promote thedevelopment of super-hydrophilic coating materials, biocompatible materials and otherfunctional materials. Furthermore, we will leverage our strength in high purification technology
to develop high-purity solvents for electronics materials and functional additives used in thesemiconductor field.

We aim to create new businesses by utilizing the technological capabilities cultivated in our
existing businesses to promote the development of materials not only for next-generation
displays but also for sensors and communications.
We will promote the establishment of a supply chain and alliances with a medium- tolong-term perspective to enhance competitiveness.

Semiconductor We will secure production capacity for the medium to long term through upfront capital
investment. We will build a strong supply chain from a medium- to long-term perspective. We
materials
will actively develop new products to improve our technology and management capabilities.
We will pay close attention to market trends and respond flexibly to market transitions.

Net sales

Operating profit / Operating profit to net sales ratio

Net sales

Operating profit / Operating profit to net sales ratio(billion yen)

Operating profit (billion yen)(billion yen)

Operating profit (billion yen)

16

14.5
12.5

12

10.3

15.5

4

15.2

21.2

Operating profit to net sales ratio (%)

22.3

25.0
3.80

23.6

19.7

3.43

2.80

3

10.6

2.19

25.0
20.0

10.0
1

4
0

2018

2019

2020

2021

0

2022 (FY)

Accounting Standard for
Revenue Recognition applied■ Net sales

2018

2019

2020

2021

2022 (FY)

5.0

4

0

0

ROA（％）

18.2

15
22.1
10

9.9

12.2

17.1

13.5
20.7

14.9

23.0

40.0
30.0

20.8

10.0

0

0

■ Assets ● ROA (Return on Assets)

2020

2021

2022 (FY)

2018

2019

12.2

2021

1
0

2022 (FY)

Accounting Standard for
Revenue Recognition applied

24.0
18.0

12.4

2

6.2

2020

17.6

16.3

3

9.7

5.9

Capital expenditures / Depreciation

Assets / ROA

Capital expenditures (billion yen)

Assets (billion yen)

3

1.44

2.52

Depreciation (billion yen)

1.33

1.08

2
0.63

0.88

1.49
0.83

0.78

2018

2019

1.29

1.02

12.0
6.0

2020

2021

2022 (FY)0■ Profit (billion yen) ● Profit to net sales ratio (%)

2019

2020

■ Capital expenditures ● Depreciation

40.0

20
15

25.2

26.6

26.3

2021

0.5

0.26
2022 (FY)

5

30.0

21.5

Capital expenditures (billion yen)

1.5

2

1.0

3.3

3.6

3.8

4.8

4.9

10.0

1

0.26

0.28

0.13
0

0

Depreciation (billion yen)

3

20.0

10
0.56

2018

Capital expenditures / Depreciation
ROA（％）

31.0

1.39

1

0

1.5

1.0

0.21
2019

6.3

■ Net sales

20.0

5

2018

21.7

Reference values calculated based on the previous accounting standards

Assets / ROA
20

6.8

8.4

■ Profit (billion yen) ● Profit to net sales ratio (%)

Reference values calculated based on the previous accounting standards

Assets (billion yen)

128Operating profit to net sales ratio (%)

4

16

15.0

2.09

2

8

19

Increase in non-petroleum-derived products
Increase in need for special functionality inthe high-tech field● High-purity products for electronics materials●

We will provide materials with special functionality to the global market by utilizing our
specialty acrylic acid ester polymerization technology and high purification technology. We will
work to develop non-petrochemical materials, carbon-recycling materials and biodegradable
materials that are in accordance with the market trends changing with the growing interest in
the SDGs.

Functional materials[Medium-term plan]
Displaymaterials

Threat[Strategy][Strategy]

Semiconductor materials

Weakness●

OOC’s status

Too high market share

Capturing demand as customers shift production tohigh-value-added small- and medium-sized displays
Sales and market share expansion in existinghigh-value-added fields
Development of new customers and new applications
by taking advantage of overseas sites, etc.

Data

Using specialty acrylic acid esters, we provide super-hydrophilic coating
materials, biocompatible materials and other materials.
We also provide high-purity solvents for electronics materials by utilizing our highpurification technology.

Opportunity
Strength

Supply chain including specialty raw materials
Unparalleled performance in the market

S Society[External environment and company status]

Display materials

External environment●●

Weakness

External environment

Strength

Display materials

ThreatDisplay materials

E Environment

G Governance[Products]
Specialty
Cosmetics We provide, domestically and internationally, acrylic resins for cosmetics used instyling, hair care, and hair coloring products as well as alkanediols for
Chemicals Business materials haircosmetics used as a moisturizing ingredient in lotions and face masks.

[Products]
Displaymaterials

Promoting
Sustainable Management

2018

2019

■ Assets ● ROA (Return on Assets)

2020

2021

2022 (FY)

0

0

2018

0.39
2019

0.28

0.25

0.53

0.32
2020

2021

0.33
0.59
2022 (FY)0.5

0■ Capital expenditures ● Depreciation

20

Integrated Report 2023

OOC’s Value Creation[Products]
Research & Business Newly
Using our proprietary acrylic acid esterification, specialty polymerization andcompounding technologies, we developed stretchable acrylic elastomer
Development Office developed
products
materials with high stretchability and flexibility; stretchable conductive materials
that are acrylic elastomers with conductivity; and organic piezoelectric materials
with flexibility. We intend to roll them out as materials for the wearables, sensors,
actuators and robotics fields.
In addition to the above, we are also developing environmentally friendly
functional materials made of biomass.

Promoting
Sustainable Management

Opportunity

Weakness

External environment

Please refer to the website for details of the products.
https://www.ooc.co.jp/research/project/

Strength

Organic piezoelectric materials

OOC’s Value Creation

Threat●Insufficient knowledge of services(applications, software, etc.) in the target
areas● Insufficient knowledge of processing
technologies, such as film and device
fabrication●

Emergence of inexpensive competingproducts with similar characteristics● Delayed launch in the wearables androbotics markets● Rising prices of raw materials andinfrastructure[Strategy]
Through clarification of target markets and deep pursuit of joint development, we will create
new value based on specialty acrylics and biomass to establish next-generation businesspillars.

[Medium-term plan]
We are working to launch new products in new business areas, including elastomer-relatedmaterials and organic piezoelectric materials, and to establish new business areas with theseproduct groups as pillars. We are also accelerating the development of new environmentallyfriendly products, including biomass-derived materials.

The 72nd “Industrial Technology Award” Received from the Osaka Industrial Research Association
Award theme: “Development of Highly Stretchable Acrylic Elastomers and Stretchable Conductive Materials”<Background of the development>
We are promoting efforts to achieve the SDGs. UV-curable
acrylic monomers are environmentally friendly materials thatcan reduce the environmental impact of volatile organic
compounds (VOCs) because they do not require solvents
during curing.
We were one of the first to recognize these monomers andhave been developing them since the late 1970s.

Based on core technology, the Advanced Technology
Research Institute designed and developed the “Suave”
series of highly flexible, stretchable elastomers that fully utilize
the characteristics of acrylic materials, with the aim ofentering the wearables and robotics fields. We are also
developing the “Suave-EL” series of stretchable conductive
materials.

Stretchable conductive material “Suave-EL” seriesAward ceremony: May 20, 2022

21

Data

Corporate Officer, General Manager of R&D Division

Promotion of development of various
sensors and other devices for a smart
society due to advancements in IoT and AI● Acceleration of initiatives to achieve theSDGs and a decarbonized society

Development of highly stretchable acrylic
elastomers and organic piezoelectric materials
with both flexibility and piezoelectricity● Owning acrylic monomers derived frombiomass●

S Society

Yusuke Tokuda

OOC’s status●

E Environment

Message from Corporate Officer Responsible for R&D[External environment and company status]

Functional acrylic elastomer materials

G Governance

We have major three business segments: chemical products,
specialty chemicals and electronics materials (display materials
and semiconductor materials). The products in these fields canbe technically classified as monomers, water-soluble polymers,
resist materials and specialty monomers for semiconductors,
and in all of these fields, our core technologies of organic
synthesis, monomer synthesis and polymer synthesis play acentral role.
One of our key features is that our researchers interact directlywith our customers to gain a firm grasp of their requirements
and can propose solutions that meet their latent needs.
Although the COVID-19 pandemic drastically reduced
opportunities for face-to-face dialog, I feel that, on the contrary,
the spread of web conferencing increased the frequency of
meetings, which has speeded up the development process insome aspects.
Regarding specialty acrylic acid esters, we are actively
developing biomass acrylates produced with less use of raw
materials derived from petrochemical resources, and we arepromoting proposals to the market. To achieve a BRC ratio of
100%, it is necessary to manufacture acrylic acid itself frombiomass resources or to monomerize bio-based substances,and we are conducting research through these approaches.
Although acrylic acid esters are difficult monomers to produce
since they are extremely easy to polymerize, we can stably
produce them thanks to our technology and know-how
accumulated over more than 50 years. Furthermore, theproduction of high-quality acrylic acid esters requires a highlevel of purification technology, including the use of appropriate
polymerization inhibitors, crystallization and distillation. In thedevelopment of new monomers with new functionality, there
are many cases in which conventional know-how cannot beapplied, and for this reason, we are continuously developing
new polymerization prevention technologies and new
purification methods. Furthermore, we are also examining thepossibility of applying our expertise in water-soluble polymers
as base materials for cosmetics to other fields by taking
advantage of the characteristics of our proprietarycarboxybetaine monomers. Specifically, they have good
properties in terms of biocompatibility and pigment dispersion,
and we are developing applications in each of these fields.
In the display business field, we are developing microlens,barrier rib material and other products using the shape control
technology for negative resists that we have cultivated. To
expand the application to flexible substrates and components
used for OLEDs, materials that cure at lower temperatures are
required. Since this is an issue that cannot be broken throughby the application of conventional technologies, we would liketo achieve this goal with the help of external research
institutions.

In the field of cutting-edge semiconductor materials,
significantly high-purity products are required, and with finer
patterned semiconductors due to the transition from ArF to
EUV lithography, the market demands are stricter every year.
To prevent the contamination of sub ppb-order metals andunknown impurities, it is necessary not only to control raw
materials but also to properly select pipes, filters and otherwetted parts. We are also working to identify substances that
may be mixed in from parts and conducting research on
equipment cleaning methods, thereby accumulating in-houseknow-how as manufacturing technologies. However, we havedifficulty in making our own proposals for monomers for EUV
resists and the pattern forming materials required beyond, andwe would like to make proposals to our customers while
incorporating external knowledge.
Since the Kanazawa Laboratory is located within the
Kanazawa Plant site, where the bench plant and the
production plant are located, we have a structure to quickly
expand the scale from the laboratory to kilos and then to tons.
Since know-how has accumulated within each segment andbecome more unique, it has become difficult to shareknow-how among segments, so we share our know-how
through monthly meetings of research leaders, etc.
At the Osaka Laboratory (CREO Research Center), completed
in 2020, research and development of resist materials andproducts in new fields are conducted. In the development of
new fields that are slightly different from the traditional businessfields, our knowledge base tends to be smaller. Therefore, we
conduct research and development activities from a mediumto long-term perspective, incorporating external knowledge, forexample, through joint research with external research
institutions, taking advantage of being located in Osaka.
As an important KPI in R&D, we monitor the 4-year New
Product Vitality Index (NPVI). This KPI is the ratio of the total
sales of new products launched in the last four years to thetotal sales of all products. The NPVI in FY2022 was 12.1%.
This is a significant increase over the past four years, when therate was about 7%. In the semiconductor field, due in part to
the rapid pace from development to mass production, the
NPVI far exceeded the target of 10% in FY2022, largely owing
to the impact of the adoption of materials for next-generation
semiconductors. In the monomer and life science fields,
however, the assessment period leading up to adoption of a
product is long, and thus it takes approximately 10 years
before it can contribute to sales. In this aspect, we believe that
it is important to continuously propose new products to themarket every year in the field of chemical products andspecialty chemicals, and we review customer needs from theBusiness Operation Division and seeds proposals from the
R&D Division once a quarter in order to formulate new themes.

22Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Message from Corporate Officer
Responsible for FinanceWith regard to dividends, we strive to pay stable andcontinuous dividends with a 30% payout ratio as a guideline
while maintaining a sound financial position. We havecontinued to increase dividends for eight consecutive years
since 2015. Furthermore, we repurchased approximately 1.7
billion yen of our own shares in 2022, bringing the total return
ratio to approximately 60%.
With regard to the current equity ratio of nearly 80%, we areaware that some have pointed out that the ratio may be toohigh. However, as a corporate leader in specialty acrylates,
since we often supply products that only we can manufactureor have a high market share in a one-to-one relationship witheach customer, it is important to earn the trust of ourcustomers, which also requires a sound financial situation.
Furthermore, the semiconductor materials, which are today’s
top earners, have been commercialized after approximately aquarter of a century of research and development. A certain
amount of equity capital is essential to enable continuous
research and development over the long term. We maintained
a double-digit return on equity (ROE) of 11.9% for the fiscal
year ended November 30, 2022, as a result of our continued
efforts to cultivate highly profitable fields, including
semiconductor materials. We will continue to place emphasis
on improving capital efficiency without settling for the statusquo.

Through more effective use of
equity capital, we aim to become
a company that contributes tothe development of society
together with our customers.
Soichi Honda
Director, Corporate Officer,
General Manager of Administration Division

We will strive to further strengthen ourinvestor relations activities, including
the publication of integrated reports.
My name is Soichi Honda, the General Manager of the
Administration Division at Osaka Organic Chemical Industry
Ltd. (“OOC”). In addition to accounting, finance and investor
relations areas, I am currently in charge of areas related to
ESG management at OOC. In this section, I explain thefinancial situation at OOC as the corporate officer responsible
for finance.
After joining OOC, I was engaged in research before moving
to sales. In 2015, I became the General Manager of the
Administration Division, and my scope of work has expanded
along with the expansion of the business, including personnel
system reforms, corporate governance and investor relations.
Now, I am responsible for administrative operations, including
accounting and finance.
With the publication of our first integrated report, we intend tofurther focus on investor relations for institutional investors
and other stakeholders. In this role, as the General Managerof the Administration Division, I intend to focus on
engagement with all of our stakeholders, leveraging thestrengths of my comprehensive knowledge of personnel,
products and money at OOC, from R&D to manufacturing
and sales.
At the company information sessions for individual investors
held in Tokyo and Osaka in January 2023, we received
encouraging comments, such as “I would like you to talkmore about dreams for the future of Osaka Organic Chemical
Industry.” We will strengthen our efforts to provide information
to meet stakeholder expectations. We also intend to once
again hold plant tours and other events that have been

23

suspended due to the COVID-19 pandemic, in an effort tohelp participants understand the appeal and future potentialof OOC.

We have continued to increase dividends
for eight consecutive years since 2015,
and our total return ratio in 2022, including
share buybacks, was approximately 60%.
During the COVID-19 pandemic, which lasted approximately
three years, we almost doubled our cash and deposits to beprepared for unforeseeable circumstances, since the start ofthe spread of infection coincided with the time when we put
new equipment into operation. Furthermore, we consideredentering into a commitment line agreement; however, we did
not do so as a result. Thanks to the strong performance of
our electronics materials business, especially semiconductormaterials, we were able to weather the COVID-19 pandemic
without any financial difficulties.
Due to the application of the “Accounting Standard for
Revenue Recognition,” for the fiscal year ended November
30, 2022, figures were calculated using a different methodfrom the previous one. Due to strong performance in theelectronics materials business and the specialty chemicals
business as well as price pass-through for raw materials in
the chemical products business, overall revenues increased
7% over the previous year based on the previous standard.
Operating profit and ordinary profit also increased 1.4% and1.8%, respectively, while profit attributable to owners ofparent decreased 5.5%. The reason for the decrease in profit
from the previous fiscal year is that we had a gain on the saleof policy shareholdings in the previous fiscal year and we did
not in FY2022.

We are steadily making investments for
medium- to long-term growth even in anenvironment where the market outlook
is difficult to predict.
For FY2023, we believe that rising interest rates, exchange
rate fluctuations and market turmoil caused by geopoliticalrisks could be negative factors for our performance. In the
consolidated forecast announced on January 12, 2023, we
had assumed that the chemical products business andelectronics materials business would struggle in the first half
and recover in the second half and that depreciation andamortization expenses would increase due to higher capital
investment, resulting in an expected increase in revenue but adecrease in profit. However, due to the significant impact ofsluggish demand, especially for electronics material
applications, such as displays and semiconductors, werevised our consolidated forecast on April 7, 2023 to adecrease both in revenue and profit compared to the previous
year.
Regarding capital investment, we are currently investing 7.5
billion yen to raise the production capacity of the Kanazawa
Plant by 60% for semiconductor materials, for which demandis strong in FY2023. This is based on our plan from FY2020
and is intended to increase the production of monomers usedin resists for semiconductors, which are one of our main
products and indispensable for the manufacture of electronic
devices around the world. Construction is generally
proceeding according to schedule. With market conditions
temporarily uncertain in FY2023, we will closely monitor salesconditions and steadily make investments for medium- andlong-term growth while considering the optimal balance
between cash on hand and debt financing.
Regarding the long-term business plan, we were able toachieve most of the key financial indicators, such as net

sales, profit to net sales ratio and ROE, as of last fiscal year,
due in part to favorable market conditions. We are currently
working on a new long-term business plan ahead ofschedule.

We will focus on developing financial
strategies and investor relations that meetthe expectations of our stakeholders.
As for the future, firstly, we will strive to further improve ourrecent performance, but also to expand our business while
maintaining a high level of profitability. In our company, thefield of materials for semiconductors is growing and promisingmaterials are appearing one after another in new areas. Froma financial perspective, this means that we need to strengthen
our financial position to enable us to invest in research anddevelopment to open up new areas of business. In the past,when the core of our business was contract manufacturing,the cost to sales ratio was about 80%, the SG&A to sales
ratio was 12 to 13% and the operating margin was only theremaining few percent. In contrast, the cost to sales ratio has
dropped to 70% over the past few years, resulting in an
operating margin of around 15%. This allows us to continue
to generate funds for future-oriented R&D and capital
investment.
Going forward, we will firmly meet the expectations ofinstitutional investors and other stakeholders by steadily
promoting sustainable growth over the medium to long term
through investments aimed at creating new value. Our
management philosophy is “We will place the highest value
on each person’s individuality and will contribute to thedevelopment of society together with our customers byproviding materials with unique functions.” As the corporate
officer responsible for finance, I would like to contribute to thedevelopment of products that are useful to society whilefurther improving capital efficiency.
I was taught from time to time by my superiors who knew thefounder that the most important mission of Osaka Organic
Chemical Industry is to solve our customers’ problems bycreating new products and to make them happy. Inheriting
this founding spirit, we will contribute to the development of
the business of OOC. In this context, we intend to focus on
investor relations so that we can answer the question “Howwill Osaka Organic Chemical Industry transform itself for the
future?” We would like to ask for your continued support.

24

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Promoting Sustainable Management
Ｅ Dealing with climate change through decarbonization
Ｅ Ensuring environmental compliance
Materiality from the perspectivesof stakeholders

The OOC Group has set key performance indicator (KPI) targets in the five fields of the environment (E),society (S), governance (G), productivity, and safety as its long-term business targets. The Group will
steadily execute its long-term business plan and thus contribute to the achievement of the SDGs byimplementing its medium-term policies, Guidelines for Conduct, and major initiatives based on its
materiality, or material CSR issues.

S Creating safe and pleasant workplaces
S Giving back to the local area around each office
G Improving corporate governance

E: Environment
S: Society
G: Governance25

Medium-term Policy

G Pursuing corporate ethics and integrity

S Respecting human rights

Ｅ Increasing sales of eco-friendly products

S Creating a diverse workforce
S Managing raw materials

Major Initiatives■ Studying how to reduce CO2 emissions■ Use of renewable energy■ Making the climate crisis personal■ Managing and reducing■ Reducing environmental impact

chemicals and waste
throughout product lifecycles■ Proactive use of resource
recycling■ Product development that considers

the balance between nature andsociety

Materiality from the Company’s perspective■ Reducing water consumption■ Complying with environment laws and regulationsof countries and regions around the world■ Environmental compliance■ Switching to more environmentally friendly modes■ Workforce recruiting and training■ Improving client satisfaction■ Ensuring product safety and quality■ Promoting health and productivity management■ Respecting human rights■ Improving employee■ Providing unique functional materials■ Promoting sound work-life balance■ Creating safe and pleasantsatisfaction (Creating
engaging workplaces)■ Proactive approach todiversity (values and variety)■ Coexistence with the planet
and the public■ Respecting dignity and rights■ Initiatives for diversity■ Creating a safe and healthy■ Dealing with diversifying information and values

environment■ Maintaining fair and impartial
business relationships that make themost of and complement eachother’s strengths■ Proactively participating in society■ Constructive dialogue for a win-win
relationship■ Creating a CSR-oriented procurement system■ Contributing to the creation of a

■ Solving issues of public concern by creating■ Business risk management■ Pursuing corporate ethics andintegrity■ Building a global partnershipfor sustainable development■ Optimizing safe operations

and management efficiency

sustainable future■ Ensuring transparency■ Proactive, effective and fair disclosure■ Keeping our promises with sincerity

and humility■ Ensuring systematic crisis

Long-term Business
Targets 2024

throughout entire value chain■ Looking into the use of renewable energyof business■ Proactive use of resource recycling■ Disclosures compliant with the Task Force on
Climate-Related Financial Disclosures (TCFD)
recommendations■ Improving corporate governance

S Improving consumer security and comfort
G Business risk management

Ｅ Allocating water resources

Guidelines for Conduct

decarbonization■ Managing waste and wastewater■ Allocating water resources■ Increasing sales of eco-friendly
products■ Ensuring environmental compliance■ Sustainability management

S Stakeholder engagement

G Sustainability management■ Dealing with climate change throughworkplaces■ Creating a diverse workforce■ CSR-oriented procurement■ Managing raw materials■ Giving back to the local areaaround each office■ Stakeholder engagement■ Improving consumer security andcomfortS CSR-oriented procurement

Ｅ Managing waste and wastewater

High

Materiality

S Workforce recruiting and training

Contributing to the creation ofa sustainable future

ESG Management

Very high■ Ensuring stable procurement of raw materials for■ CO2 emissions(compared to FY2013)

Very highContributing
to theachievement of
the Sustainable
Development
Goals (SDGs)

15％ or greater
reduction

Fiscal 2030

30％ or greater
reduction

Fiscal 2050

Achieve carbon neutrality■ Job satisfaction index

Vibrant organization
grade B (top 10% to 30%)

key products■ Ongoing interactions with local areas■ Promoting dialogue around sustainability■ Tokyo Stock Exchange

Corporate Governance
Code (CGC) compliance
rate

100%
value

(keeping a “higher
quality of corporate
governance”)■ Improving management transparency andmaking management systems more efficient■ Spread of our Management Philosophy■ Creating a risk management system■ Lost-time injuries

0 cases/year

management■ Placing safety as our top priority

26

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Initiatives for Materiality
Material Issue (materiality)

ESG
area

Dealing with climatechange throughdecarbonization

Stakeholders
Employees

Clients &suppliers

Investors &shareholders

SocietyChildren of
the futureMainstakeholders

Fiscal 2022
Major initiatives

Relevant SDGs

Fiscal 2024 KPI target
Actual results

Main activities

Studying how to reduce CO2
emissions throughout entire value chain
Looking into the use of renewable energy

CO2 emissions reduction: 15% or larger(compared to fiscal 2013)12%

Installed equipment that meets the top-runnerstandards in a newly constructed facility
Replaced all air conditioning equipment at the
Kanazawa Laboratory
Relocated the Head Office

Proactive use of resource recycling

Recycling rate: 25% or higher

20%

Reviewed the methods for solvent recovery andreuse and equipment cleaning
Currently designing a waste oil boiler to be installed

〇

〇

〇

◎

Children of
the futureManaging waste andwastewater

〇

〇

◎

〇

Society

Allocating water
resources

〇

〇

〇

◎

Children of
the future

Reducing water consumption

Water consumption: Maintain the current
level (limit the increase to 5% or smaller
compared to fiscal 2019)-1.6%

Monitored and maintained the amount ofgroundwater drawn

〇

〇

〇

◎

Children of
the future

Switching to more environmentallyfriendly modes of business

Production volume of environmentallyfriendly products: 15% or more of total
production volume

8.9%

Expanded sales of acrylates made of
biomass-derived or recycled raw materials

Increasing sales of
eco-friendly products

〇

E

〇

Clients &suppliers〇◎

Society◎〇

Employees◎

Ensuring environmental
compliance〇

Complying with environment laws
and regulations ofcountries and regions aroundthe world

Reduction in the amount of released
substances included in the pollutant
release and transfer register (PRTR): 60%
or larger (compared to fiscal 2019)19%

Measured and monitored losses due to the materialbalance
Currently planning to install a volatile organic
compounds (VOC) combustor

Increase in the number of job applicantsfrom among prospective new graduates:
10% (compared to fiscal 2018)

97.0%

Actively participated in joint job fairs organizedby the Society of Polymer Science, Japan, anduniversities

Employees

Three-year retention rate: 100%

89%

Continued to interview new employees in somedepartments in their first, third, and sixth monthsof employment

Employees

Improving workforce training[Engagement] Training satisfaction score:
3.5 or higher out of 5

2.99

Divided courses in the stratified training program
into compulsory ones and electives and launcheda system that allows program applicants to attend
the courses they like, resulting in a total of 239
employees attending electives

Employees

Combating harassment
Dealing with diversifying
information and values

Attendance at annual complianceeducation: 100%

100%

Invited lawyers as lecturers and held a total of eighttraining sessions, which comprised ones only for
managers and the others only for general employees;
Had all trainees submit training reports

Increasing the level of namerecognition of OOC

Workforce recruiting
and training◎〇◎
Respecting humanrights

◎

〇

〇

〇

◎

Employees

Engagement survey results:
Vibrant organization grade B (top 10% to30%)Grade C
(top 30%
to 45%)

Conducted an engagement survey◎

Employees

Increase in gross profit per employee:
50% (compared to fiscal 2019)

27.1%

Improved the profitability of unprofitableproducts (by consolidating products and othermeans)◎

Employees[Favorable working environment]
Percentage of paid leave taken: 70% or
higher

59.1%

Conducted a pilot operation of a new shift work
system that enables even shift workers to takepaid leave more easily◎

Employees[Favorable working environment]
Flexible work hours adoption rate
(excluding shift workers)

59.2%

Ensured more widespread use of the systemthrough awareness-raising efforts[Health] Obtain certification as an
outstanding organization in health andproductivity management

Obtained

Participated in a walk rally[Safety] Lost-time injuries: 0 cases/year

2 casesS

Creating safe andpleasant workplaces

Revised Safety Data Sheets (SDSs) in line with therevised Japanese Industrial Standards (JIS)(completed); Surveyed chemical substances
contained in products in line with the revised
Industrial Safety and Health Act

Comply with laws and regulations related
to chemical substances◎〇

Employees◎〇

Employees

Promoting health and productivity
management
Promoting sound work-life balance◎: Key stakeholders〇: Stakeholders involved

27

28

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Initiatives for Materiality
Material Issue (materiality)

ESG
area

Creating a diverse
workforce

Stakeholders
Society◎〇〇

Employees◎〇〇

Employees◎〇〇

Employees〇

Clients &suppliers

CSR-oriented
procurement
Managing raw
materials

Children of
the future

Investors &shareholders

Employees

Clients &suppliers

Mainstakeholders◎

Percentage of mid-career hires: 20% or
higher

29.4%

Increased the frequency of mid-career recruitment
advertisements
Appointed temporary staff to be regular employees

Percentage of female managers: 10% or
higher (target for fiscal 2026)

2.4%

Invited female employees to luncheons with thepresident in order to have them exchange opinions
on their workplace concerns

Percentage of eligible male employees
taking childcare leave or leave forchildcare purposes: 20% or higher

100%

Number of male employees with newborn babies: 8• Number of male employees who took childcare
leave: 1• Number of male employees who took special paid
leave for childcare purposes: 7

Creating a CSR-oriented
procurement system

Percentage of suppliers endorsing our CSR
Procurement Guidelines: 80% or higher (ona purchase amount basis)

84%

Requested the largest suppliers (contract
manufacturers) on a purchase amount basis to signconsent forms and collected those forms from them〇

Clients &suppliers

Ensuring stable procurement of
raw materials for key products

Identify supply risks (by mapping relevant
manufacturing locations and suppliers)

Ongoing interactions with local
areas

Number of initiatives with local
communities to solve social issues: 3 ormore per month

Promoting dialogue aroundsustainability

Demonstrate the value of our existenceby addressing sustainability in society(qualitative target)

〇

〇

◎

Society

Stakeholder
engagement

〇

〇

◎

〇

〇

Investors &shareholders

Improving consumer
security and comfort

〇

〇

〇

◎

〇

Society

〇

〇

〇

〇

〇

〇

◎

〇

◎

Children of
the future

Investors &shareholders

Improving corporate
governanceG

Pursuing corporate
ethics and integrity

Investors &shareholders◎

Business risk
management◎

Relevant SDGs
Main activities

Giving back to the local
area around each officeSustainability
management

Fiscal 2024 KPI target
Actual results

S◎

Fiscal 2022
Major initiatives

Initiatives for diversity

Raising awareness of how tobenefit the community throughbusiness activities
Solving issues of publicconcern by creating value

Improving managementtransparency and making
management systems more
efficient

4 per month

Promoted sustainability-focused dialogue with eachstakeholder
Met increased demand for semiconductor anddisplay materials

Percentage of sales from new products:
10% (four-year cumulant)

12.1%

Number of serious violations of laws andregulations: 0 cases/year

0 cases

Built thorough employee awareness of legal
complianceTokyo Stock Exchange Corporate
Governance Code (CGC) compliance
rate: 100% (keeping a “higher quality ofcorporate governance”)

97.6%

Held ESG meetings with institutional investors
Reduced cross-shareholdings

Defined priority risks and disclosed proposed
countermeasures (in the Annual Securities Report)

Developed new kinds of biomass acrylates using
non-petrochemical raw materials

◎

〇

〇

Clients &suppliers

Creating a risk management
systemNumber of financial forecast revisions
due to the realization of perceived risks:
0 cases/year

0 cases〇〇〇

Employees

Spread of our Management
Philosophy

Score in the penetration of ourManagement Philosophy: 4.0 or higher

3.4◎: Key stakeholders〇: Stakeholders involved• Selected key raw materials and tested samples
with a view to diversifying raw-material suppliers• Listed key raw materials in preparation formapping manufacturers and suppliers
Proactively promoted interactions with the local
communities while paying full attention to
COVID-19 infection control, against a backdrop of
our heightened communication with them

Linked engagement survey questions to ourManagement Philosophy and quantified them

Other detailed ESG data are available on our website.
OOC Viewed in Data
https://www.ooc.co.jp/csr/data/

ESG Datasheet
Governance (G) Data
https://www.ooc.co.jp/csr/data/pdf/esg_governance.pdf?ver=1
Environment (E) Data
https://www.ooc.co.jp/csr/data/pdf/esg_environment.pdf?ver=2
Society (S) Data
https://www.ooc.co.jp/csr/data/pdf/esg_society.pdf?ver=22930

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

E Environment

G Governance

S SocietyData

G GovernanceCorporate GovernanceCorporate governance is an area that the OOC Group works actively to improve and enhance. In this area, wedevote efforts to ensuring the integrity of our business activities and increasing management transparency and theefficiency and speed of management systems. We view these efforts as a way to achieve both sustainablecorporate growth and a medium- to long-term increase in our corporate value. Improving corporate governance isa material management issue for us to tackle based on the going-concern assumption (an assumption about theGroup’s business continuity) fully shared with stakeholders both inside and outside the Group.

Executive Profiles (as of February 24, 2023)
Directors

Auditors

Governance Highlights (as of November 30, 2022)
Number of meetings ofthe Board of Directors

16

Number of meetings ofthe Board of Auditors

Number of meetings of
the Advisory Committees

15

Nominations:

4

Remuneration:

Number of CSR/
ESG-related interviews

3

5

Material Issue: Improving Corporate GovernanceImproving management transparency andmaking management systems more efficient

Fiscal 2023
[Targets andissues]For more details, refer to our website.
https://www.ooc.co.jp/ir/material/governance_doc/
Corporate Governance Report

Addressing each issue to improve the effectiveness of the Boardof Directors
Responding to revised TSE Corporate Governance Code (CGC)
Enhancing ESG disclosures and having proactive dialogues

Corporate GovernanceImprovement Milestones

2
1
1

9

■ Director (Internal)■ Director (Outside)■ Auditor (Internal)■ Auditor (Outside)

2

2

1
2

1
2

7

2014

2

7

2015

2

1
2

6

2016

2017

1
2

2
1
2

2

2

1
2

1
2

2
1
2

5

4

4

4

4

2019

2020

2021

2018

Feb. 2016

Optimization of Board-of-Director composition

2022 (Fiscal year)

One outside director added to the Board

Establishment of a Remuneration Advisory Committee

Dec.
2018

July 2019Feb. 2022

Board of Directors

An outside director appointed as chairperson
July
2022

Establishment of a Sustainability Committee

OOC Group’s Corporate Governance Organization
General meeting of shareholders

Nominations Advisory Committee

Board of Directors
I

I

I

O

O

I

O

I

O

O

O

Remuneration Advisory Committee
I

Internal Control Committee

O

O

CEO

Risk/Compliance Committee

31

IInternal
directorO

Outsidedirector

I

Internal
auditorO

Outsideauditor

Shigeji Eimura

Soichi Honda

Managing Corporate
Officer
General Manager of the
Production Division and
Kanazawa Plant
Director

Corporate Officer
General Manager of the
Administration Division

Outside Director

Dec.
2019

Board of Auditors

Sustainability Committee

Motomi Ogasahara Takayuki Hamanaka
Director

Outside Director

Yasuko Yoshida

Sobi Nagayanagi

Tomoko Takase

Outside Auditor

Managing Auditor

Outside Auditor

Corporate Officers

Takayuki
Hamanaka

An outside director
replacing the CEO tochair the committees

Establishment of a Risk/Compliance Committee

Accounting auditors

Representative
Director and CEO

Feb.
2018

Abolition of the retirement benefit program

I

Masayuki Ando

Director

MotomiOgasahara
Corporate Officer
General Manager of theBusiness Operation
Division and Managerof the International
Business Department

Tetsuya Watanabe

Yusuke Tokuda

Kiyoaki Shizume

Shuichi Akita

Corporate Officer
General Manager of the
Corporate Planning
Division

Corporate Officer
General Manager of the
R&D DivisionCorporate Officer
Manager of the
Research & Business
Development Office

Corporate Officer
Sakata Plant Director andManager of the
Production Department,
Production Division

Professional Backgrounds of Outside Directors

Feb.
2018
Dec.
2018

O

Soichi Honda

Director

Ratio of outside directors raised to 1/3

Establishment of a Nominations Advisory CommitteeO

Tetsuya Watanabe

July 2019

Adoption of a corporate officer system

I

Naoki Enomoto
Outside Director

Management Council
Corporate officers, departments, and affiliates

Internal Audit Office

Naoki
EnomotoOutside Director

Professional Backgrounds of Outside Auditors

Apr. 1998: Registered as an attorney-at-law (Osaka Bar Association)
Apr. 1998: Admitted to Showa Law Office (currently Habataki Law Office)
July 2005: Earned EU Law LL.M. (Master of Laws) at the Faculty of Law,
Katholieke Universiteit Leuven, Belgium
July 2005: Joined the Brussels Office of Linklaters and assigned to the EU
Competition Law Department
Dec. 2007: Partner of Habataki Law Office (to date)Feb. 2016: Director of OOC (to date)
Apr. 1985: Joined the Ministry of FinanceJuly 1991: Director of the Seki District Tax Office
May 1999: Counselor, Japanese Embassy in Malaysia
July 2002: Director, Accounts Division, Minister's Secretariat, Ministry of FinanceJuly 2003: Director of the Collection Department, Tokyo Regional Taxation Bureau
July 2004: Director for the Defense Industry in the Aerospace and Defense
Industry Division, Manufacturing Industries Bureau, Ministry of
Economy, Trade and Industry
July 2006: Director of the Office of Balance of Payments & International CapitalMarkets, Foreign Exchange Markets Division, International Bureau,
Ministry of FinanceJuly 2008: Director for Fiscal Investment and Loan Appropriation (in charge of the
Cabinet; Finance; Agriculture, Forestry and Fisheries; the Environment;
Economy, Trade and Industry; and Land, Infrastructure, Transport andTourism), Financial Bureau, Ministry of FinanceJuly 2009: Director of the Finance Division, Bureau of Finance and Equipment,
Ministry of Defense
July 2011: Director of the Government Financial Institutions Division, Minister's
Secretariat, Ministry of FinanceSep. 2012: Counselor, Office in Charge of the Nuclear Damage Compensation
Facilitation Corporation, Cabinet Office
July 2014: Director-General of the Tohoku Local Finance Bureau
June 2015: Member of the Board of Directors and Managing Executive Officer,
Development Bank of Japan Inc.
July 2017: Director-General, Fukuoka Regional Taxation Bureau
July 2018: Director-General, Osaka Regional Taxation Bureau
Aug. 2020: Director-General, Tokyo Custom-House
Nov. 2021: Adviser, Sompo Japan Insurance Inc. (to date)Feb. 2022: Director of OOC (to date)Aug. 2022: Adviser, The Nanto Bank, Ltd. (to date)

YasukoYoshidaOutside Auditor

TomokoTakaseOutside Auditor

Oct. 2000: Admitted to Asahi & Co. (currently KPMG
AZSA LLC)
May 2004: Registered as a certified public accountant
July 2005: Registered as a certified tax accountant
July 2005: Director of Yoshida Certified Public
Accountant Office (to date)Feb. 2019: Auditor of OOC (to date)
May 2021: Registered as a U.S. Certified Public
Accountant (State of Washington)
June 2021: Outside Member of the Audit & Supervisory
Committee, Espec Corp.
June 2022: Outside Director (Audit & Supervisory
Committee member), Espec Corp. (to date)
April 2000: Registered as an attorney-at-law
April 2000: Joined Matsui Takao Law Office
June 2002: Joined Taiheiyo Law Offices
Oct. 2009: Joined Murata & Futaba Law Office(currently Arcus Partners) as a partner (todate)
Feb. 2022: Auditor of OOC (to date)32

Integrated Report 2023

OOC’s Value Creation

Director and Auditor Skills Matrix● Chairperson or committee chairperson ● Member ● Jury ● Expertise and experience

Collegiate body
Job title

Name

Representative
Masayuki
Director and CEO Ando

Board ofDirectors

Board ofAuditors

Manage- Internal
mentControl
Council Committee

Knowledge, experience, and expertise

Nominations Remuneration
Risk/
ManageSustainability
Advisory Advisory
Compliancement
Committee
Committee Committee
Committee

●

●

●

●

●

●

●

●

●

Legal,

ESG

Soichi Honda

●

●

●

Director

MotomiOgasahara●●●

Director

TetsuyaWatanabe●●●Outside Director Takayuki
Hamanaka

●

●

●

●

●

●

●

Outside Director Naoki
Enomoto

●

●

●

●

●

●

●

Managing Auditor Sobi
Nagayanagi

●

●

●

●

Outside Auditor Yasuko
Yoshida

●

●

●

●

●

●

Outside Auditor Tomoko
Takase

●

●

●

●

●

●

●

●

●

●

●

R&D

●

●

regulatory,
Finance
International and Risk and administraexperience accounting internal tive, and Careers, qualifications, etc.
controls
other affairs●

Director●

Sales

R&D, overseas business,and corporate planning

●

●

●

●

●

●

●

Sales, overseas business,
and administration●●

Sales and overseas business
R&D, sales, and corporate
planning

●
●
●

●

●

Attorney license; overseas
business●●

Ministry of Finance, Ministry of
Economy, Trade and Industry,and Regional Taxation Bureaus●

R&D, management systems,
and internal auditing●

Certified tax and public
accountant license

G Governance

E Environment

S Society

Data■ Executive Compensation System
OOC has established a remuneration system and remuneration levels
for directors and auditors with a view to improving its businessperformance over the medium to long term and enhancing its corporate
value in accordance with its Management Philosophy.
The following resolutions have been adopted on remuneration for
executives at past General Meetings of Shareholders.
The 60th Ordinary General Meeting of Shareholders, held on February
23, 2007, resolved that the annual amount of remuneration for directors
be up to 360 million yen (excluding portions paid as employee salaries).
(As of the conclusion of that meeting, the number of directors wasseven.) The 71st Ordinary General Meeting of Shareholders, held on
February 27, 2018, resolved that the annual amount of restricted stockcompensation additionally paid to internal directors be up to 10 million
yen (excluding portions paid as employee salaries). (As of the conclusionof that meeting, the number of directors was six.) Moreover, the 75th
Ordinary General Meeting of Shareholders, held on February 25, 2022,

resolved that the annual amount of performance-linked stockcompensation additionally paid to internal directors be worth up to
40,000 shares. (As of the conclusion of that meeting, the number of
directors was six.)
Meanwhile, the 59th Ordinary General Meeting of Shareholders, held on
February 24, 2006, resolved that the annual amount of remuneration forauditors be up to 40 million yen. (As of the conclusion of that meeting,the number of auditors was three.) The retirement benefit program fordirectors was abolished at the conclusion of the 71st Ordinary General
Meeting of Shareholders held on February 27, 2018.
Remuneration for directors consists of monthly remuneration as basic
remuneration and three types of performance-linked remuneration: anannual bonus, performance-linked stock compensation, and restricted
stock compensation. On the other hand, we only pay basic monthly
remuneration to outside directors and auditors from the perspectives of
their roles and independence.

Remuneration typeObjective and outline

Monthly remuneration

Monthly fixed cash remuneration whose amount is determined according to the position

Annual bonus

Role and Authority of Independent Outside Directors and Advisory Committees

This is performance-linked cash remuneration paid to reward each director’s contribution to steady achievement of targets eachfiscal year.
The amount of this type of remuneration is calculated based on year-on-year changes in consolidated results in key management
indicators (net sales, operating profit, and EBITDA) to clarify each director’s responsibility for the annual results.
For fiscal 2022, we set a target of consolidated financial results being 103% of the fiscal 2021 levels and achieved the exact target.
The payment rate was determined within the range from 0 to 200% of the base amount according to the level of target achievement.
This type of remuneration is provided in a lump sum after the end of the relevant fiscal year.

OOC has continued to strengthen its corporate governance system inaccordance with the provisions about “Use of Optional Approach”(Supplementary Principle 4.10.1) in the TSE Corporate GovernanceCode. The specific measures we have adopted for that purpose include
appointing independent outside directors and establishing Advisory
Committees.
OOC currently has two independent outside directors, one of whom
serves as chairperson of the Board of Directors. Both of them offer theiropinions at meetings of the Board of Directors and provide advice toeach of the other directors as necessary, leveraging their highly
specialized knowledge and abundant experience. We will continue toThis is grant-type performance-linked stock compensation paid to directors other than outside directors (hereinafter, “eligible
directors”). The objectives of this type of remuneration are to offer eligible directors the incentive to work to constantly increase
OOC’s corporate value and to more clearly show linkage between remuneration for eligible directors on one hand and OOC’s
financial results and stock value on the other hand, thereby promoting further sharing of value with shareholders.
The number of shares to be provided is determined within the range of 0% to 200% of the base amount according to the level ofachievement of targets, including financial results during the three-year evaluation period. This type of remuneration is provided ina lump sum after the end of the relevant fiscal year.
To link the performance targets used as standards for the determination of the remuneration amount to the targets set in theSecond Five-Year Medium-term Business Plan, we set targets of a three-year average consolidated ROE of 10.0% or higher anda three-year average consolidated operating margin of 13.5% or higher (before the application of revenue recognition standards).
The results for fiscal 2022 were consolidated ROE of 11.9% and consolidated operating margin of 15.8% (before the applicationof revenue recognition standards).

●
●

●

●

Attorney license

examine the possibility of having independent outside directors as amajority of the Board of Directors.
We also have two Advisory Committees—the Nominations Advisory
Committee and the Remuneration Advisory Committee—under the
Board of Directors. These committees are responsible for deliberatingon important matters, such as the nomination of OOC’s directors andremuneration therefor. Each of these committees comprises two
independent outside directors, one of whom chairs it, and the CEO. In
these committees too, independent outside directors are involved
appropriately and provide helpful advice.

Formulation and Implementation of a Succession Plan
From the perspective of sustainable growth of our business over the
medium to long term, we recognize that the development ofmanagement personnel is one of the most important issues to beaddressed. Therefore, the Board of Directors has taken the initiative informulating and implementing a succession plan in accordance with theprovisions about “Roles and Responsibilities of the Board”(Supplementary Principle 4.1.3) in the TSE Corporate Governance Code.
Specifically, we recognize that the incumbent CEO himself/herself shouldbe actively involved in the selection of a candidate for the successor andbe responsible for planning the development of the prospective
successor. If it is difficult for the incumbent to select a successor
candidate, the Nominations Advisory Committee may play a leading rolein his/her place.
On the other hand, if there is an option of reappointing the incumbent
CEO, only the chairperson of the Nominations Advisory Committee andoutside directors who are members of the committee will engage indeliberations on whether or not to reappoint the incumbent so that thefairness of the deliberations will be ensured. The Nominations Advisory
Committee is also responsible for receiving sufficient reports from theCEO on the successor development plan and the nomination of a
specific successor candidate, exchanging opinions, examining thosereports based on its evaluation of the CEO and OOC’s management
issues from an independent standpoint, and providing feedback.
When the incumbent CEO selects and nominates a specific successor
candidate, that candidate’s aptitude for the post of CEO will be
evaluated by the Nominations Advisory Committee from an independentand objective standpoint.
The following are the Succession Planning Policy and Development Plan
Policy formulated on January 22, 2021.
(1) Succession Planning Policy
The formulation and implementation of a CEO succession plan shallbe the CEO’s duty to be performed under his/her authority.
The Nominations Advisory Committee shall define criteria for selecting
candidates for the CEO, formulate a selection process anddevelopment plans, and confirm the overall process before
monitoring the succession plan and reporting to the Board of
Directors on the candidates or other matters.
(2) Development Plan Policy
To develop the next generation of management executives who will
support OOC’s continuous growth, the CEO shall always consider
who can be promising successor candidates, mainly from among
directors and corporate officers, and strives to develop them.

Efforts to Improve Management Transparency■ Enhancement of Disclosures to Overseas Investors
We have made efforts to provide overseas investors with corporate
information in English. Our website currently offers the following
documents in English: the Notice of Convocation of the General Meetingof Shareholders, Financial Results, Financial Results Briefing Materials,
and the CSR Report. Our financial disclosures in English (Summary of33

Promoting
Sustainable Management

Financial Results) are also available on the “Listed company details(basic information)” page in the “Listed Company Search” section of thewebsite of Japan Exchange Group, Inc. We are thus striving to enhance
our financial disclosures in English for overseas investors.

Performance-linked stockcompensation

This is stock compensation paid to directors other than outside directors (hereinafter, “eligible directors”). (The period of restriction
on transfer is three years.) The objective of this type of remuneration is to offer eligible directors the incentive to work to constantly
increase OOC’s corporate value, thereby promoting further sharing of value with shareholders.

Restricted stockcompensation

Composition of basic remuneration and performance-linked remuneration

Monthly
remuneration

Annual bonus

Performance-linked
stock compensation

Restricted stockcompensation

Ratio of basic
remuneration to
performance-linked
remuneration

100

36

24

17

100/77

100

72

48

33

100/153

100

36

24

17

100/77

Basic remuneration
Director category

Chairperson
Directors (excludingCEO
outside directors)
Corporate officer

Performance-linked remuneration (base amount)■ Reduction of Cross-shareholdings(1) Policy for Reducing Cross-shareholdings
According to criteria defined for OOC’s stock ownership, the Board of
Directors annually reviews each company in which the Company has
shares and makes decisions to reduce the number of its
cross-shareholdings.
(2) Criteria for Stock Ownership
We hold shares only when we believe that it is reasonable to do so
because, for example, it will help maintain and strengthen stable andlong-term business relationships with clients and suppliers or help
enhance our corporate value over the medium to long term. We
periodically report on our holdings to the Board of Directors and assess
the appropriateness of holding each stock by comprehensively
considering its contribution to maintaining and strengthening a particularbusiness relationship, the medium- to long-term benefits of our holdingof it, and whether benefits and risks entailed by our holding of it deserve

the capital costs.
(3) Exercise of Voting Rights Entailed by Cross-shareholdings
To appropriately handle voting rights entailed by ourcross-shareholdings, we have established specific criteria for the
exercise of such rights so that we can comprehensively judge whether
our exercise of voting rights will enhance the medium- to long-term
corporate value of the client company or supplier and contribute to oursustainable growth and benefits. We exercise voting rights according tothese criteria.

Fiscal 2022 results
Number of
Number of
Acquisition
0.298 billion yen
stocks acquired 1 shares acquired 17,300
cost
Number of
Number of2
shares sold 56,400 Selling price 0.061 billion yen
stocks soldWe will continue our efforts to reduce our cross-shareholdings.

34

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

E Environment

G Governance

S Society

Data

Risk Management［Basic Risk Management Policy］

Efforts to Improve Management Efficiency■ Improving the Effectiveness of the Board of Directors
To assess the overall effectiveness of our Board of Directors, we
conducted a questionnaire survey of directors and auditors on theoperation, deliberation, and composition of the Board, the status ofefforts to solve issues it faces, the support system for it, and its overallrating. The survey results compiled were analyzed and evaluated by the
Board of Directors itself, resulting in a “generally good” rating of its
effectiveness.
The effectiveness of the Board has thus been confirmed.

■ Reasons for Confirming That the Effectiveness of the Board of Directors Is Generally Good● While the composition of a Board of Directors should underpin its

working to ensure that our philosophy will permeate the OOC Groupand to strengthen ESG disclosures to our stakeholders by publishingan annual CSR Report. In addition, we disclose our financial results,financial presentation materials, convocation notices, and CSR
Reports in not only Japanese but also English.
● We hold semi-annual company briefings and quarterly individual
meetings with institutional investors to strengthen communication withinvestors. We ensure that our deliberations are highly conscious of all
stakeholders by making quarterly reports to the Board of Directors
and discussing and implementing improvements to employee working
environments and the enhancement of our community and social
contributions.
● The governance issues of succession planning and the adoption of
performance-linked remuneration are currently in the phase of systemestablishment and operation after being discussed by the
Nominations Advisory Committee and the Remuneration Advisory
Committee.
● We strive to improve our way of information sharing with members of
the Board of Directors in preparation for and during Board meetings
so that the Board can have full discussions and deliberations.
● In addition to individual training for directors and auditors, we haveprovided quarterly group training on themes common to them tofurther strengthen our support system.

■ Deeper Involvement of Outside Directors in the Formulation of Medium- to Long-term Business Plans
In the process of formulating the past medium- to long-term businessplans, we have sufficiently explained about those plans to outside

directors. We will also involve outside directors in in-depth discussions
on the formulation of our next medium-term business plan.

■ Risk Management Measures
The Risk/Compliance Committee, a sub-organization of the Internal
Control Committee, has been established to operate our risk
management system. The Board of Directors has been monitoring thestatus of our risk management based on reports from the Internal

Control Committee. We will continue to enhance the Internal Control
Committee and the Risk/Compliance Committee and to have the Boardof Directors deeply discuss risks to our business based on themonitoring results.

1. The OOC Group’s top priority is to ensure the safety ofhuman life.
2. We position risk management as an important management
issue and work on activities from a company-wide
perspective to prevent the occurrence of risks.
3. We promptly report risk-related information and share it
throughout the company.
4. All officers and employees of the OOC Group shall improvetheir risk sensitivity and promote risk management with theparticipation of all employees.
5. We will respond quickly and appropriately when risks ariseand strive to minimize losses.

■ Discussions about Governance Measures (Related to the Succession Plan,
the Gender Composition of the Board of Directors, and the Introduction of Medium-term
Performance-Linked Remuneration)
We have introduced a successor development plan and medium-term
performance-linked stock compensation and have been monitoring theirimplementation.
The gender composition of the Board of Directors still requires further
discussions.

We recognize that the key to solutions to the aforementioned issues willremain communication among executives (directors and auditors). We
will continue to improve and strengthen the effectiveness of the Board of
Directors.

Likelihood of Realization × Impact Level
High

Accidents;
disasters;
pandemics

Priority risk
External environment

Dependence on
specific fields

Objectives

Acquisitions;capitaltie-ups

1. Ensuring the safety of human life
2. Business continuity
3. Loss avoidance through risk reduction
4. Securing the trust of stakeholders
5. Enhancing corporate value

Risk Management Process

R&D
investments

Overseasbusiness
activities

Internal environment

Procurement of
raw materials;
fluctuations in
oil and raw
material prices

Operational process

Environmental andLegalclimateregulation
changeEconomic
trends; product Information
markets
securityIntellectual
property
Product
quality

1. Identify and assess risks
Identify the risks that affect the business plan for each fiscal
year and evaluate them in terms of their impact onmanagement, frequency of occurrence, and vulnerability.
2. Determine critical risks
Based on the results of the evaluation, select the OOC
Group’s priority risks, and consider and select the necessary
countermeasures.
3. Monitor the implementation status of risk measures, etc.
Monitor the key risks, including the implementation status ofplanned risk measures.

Workforce
recruiting

Low

Likelihood of realization

High

Risk/Compliance (R/C) Committee
Risk identification and classification
Risk occurrence frequency
Risk impact size
Risk vulnerability

Risk analysis and assessment
Internal Control
Committee
Risk response and handling
Affecteddepartments

Risk monitoring and review

those handouts to help outside directors and auditors better understandagenda items and deepen their discussions.

Risk Map

Litigation■ Further Improvements to Agenda Handouts and Their Contents
We have improved handouts on the agenda and their contents. In the
future, we will continue our efforts to improve the design and contents of

We identified risks in consideration of the characteristics ofeach division and our business environment, including political,
economic, and social conditions.
We then assessed those identified risks from the perspectivesof the likelihood of their realization and the levels of theirimpacts. Based on the assessment results, we created a risk
map and designated business risks and priority risks.

Impact level

independence and objectiveness, OOC’s Board of Directors had two
independent outside directors out of its six members, with the ratio ofoutside directors being 1/3. In addition, an independent outside
director has chaired the Board of Directors since February 2022. The
Nominations Advisory Committee and the Remuneration Advisory
Committee, which are advisory bodies to the Board of Directors, havebeen established, and an independent outside director has been
appointed as the chairperson of each to ensure the supervisory
function of the Board of Directors by providing appropriate reports.
● We have established the Risk Management and Compliance
Committee under the Internal Control Committee, which is asubordinate organization of the Board of Directors, to strengthen therisk management system and establish a system whereby the Boardof Directors monitors management risks. In 2022, we established theSustainability Committee to ensure governance and risk management
related to climate change. We have also launched the Carbon
Neutralization Study Committee to promote our initiatives to realize adecarbonized society.
● At the end of February 2020, the Board of Directors resolved toabolish the anti-takeover measures after thorough discussions. The
Board is currently striving to further enhance corporate value by taking
measures to achieve the medium- to long-term business plan.
● In August 2020, we developed our philosophy system. We are

The OOC Group will promote risk management to prevent theoccurrence of risks and to protect the safety of officers,
employees, and local residents in the event of an emergency,
and to ensure the continuation of business operations.

Designation of Business Risks andPriority Risks

Carrying out risk management
Risk management process

3536Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Business Risks and Priority Risks
Risk factor

Description

Risk mitigation measures

Risk factor

Description

Risk mitigation measures

Priority risk

Delayed or disrupted supply due to accidents, quality
defects, bankruptcies, etc. at raw-material or contract
manufacturers or due to U.S.-China trade friction, the war
in Ukraine, or other geopolitical factors may hinder the
production activities of OOC and its subsidiaries. In
addition, significant fluctuations in crude oil and naphtha
prices and consequently in raw material prices may affectthe business performance of OOC and its subsidiaries.

OOC strives to ensure stable procurement of raw materials
by securing multiple suppliers of raw materials. We arealso working to reduce the impact through such measures
as linking the status of raw-material supply to productprices and reducing costs.

(12) Product quality

The occurrence of an unpredicted serious quality problem
in a product manufactured by OOC or its subsidiaries may
affect their business performance.

Based on our quality management system, we are striving
to enhance our quality assurance system. OOC also
carries product liability insurance to cover risks.

(13) Intellectual property

Large-scale natural disasters, fires, accidental dischargesof chemical substances, pandemics, or other events may
cause the suspension of the production activities of OOC
and its subsidiaries and consequently affect their businessperformance.

In addition to conducting regular inspections of
manufacturing facilities and employee education and training,
we have formulated a business continuity plan (BCP) andconduct periodic exercises to reduce risk in the event thatthe BCP should be put in motion. Since the COVID-19
pandemic broke out, we have been operating while
implementing comprehensive infection prevention measures.

The occurrence of a problem related to intellectual
property rights, such as leakage of proprietary technology
or know-how or likely infringement of the intellectual
property rights of other companies, may affect thebusiness performance of OOC and its subsidiaries.

In addition to strictly managing our technology andexpertise, we conduct thorough investigations to ensurethat we and our subsidiaries do not infringe on theintellectual property rights of other companies, and wedevelop our business in such a way that we do not infringeon the rights of other companies.

Priority risk

The radical revision or enhancement of laws and regulations
related to chemical substances in Japan and overseas may
impose restrictions on the business activities, including
production activities, of OOC and its subsidiaries andconsequently affect their business performance.

We collect information on trends in the operation andrevision of domestic and foreign laws and regulations, andwe conduct our business operations in compliance withlaws and regulations pertaining to chemical substances.

Damage from self-caused environmental pollution andfrom the consequent decline in social trust or an increasein the cost of processing increased waste may affect thebusiness performance of OOC and its subsidiaries. The
emergence of new legal and social responsibilities due toclimate change or the transition to a decarbonized society
may cause an increase in the cost of measures for legal
compliance and consequently affect the businessperformance of OOC and its subsidiaries.

Overseas business activities entail the potential risk ofbeing affected by deterioration of political, economic, or
security conditions, unexpected revisions to laws or otherrules, war, terrorism, etc. Such events may hinder thebusiness activities of OOC and its subsidiaries andconsequently affect their business performance.

We will acquire and train excellent local human resources,
minimize risk by quickly obtaining accurate information
and responding appropriately, and promote thedevelopment of internal controls at our overseas bases.

We not only comply with applicable laws and rules but
also manage environmental pollutants and hazardous
substances according to management standards we havedefined, as well as working on waste reduction.
In June 2022, we announced our adoption of the Task
Force on Climate-Related Financial Disclosures (TCFD)
recommendations. Aiming for a target of achieving zero
greenhouse gas (GHG) emissions by fiscal 2050, we are
implementing measures to address such issues as climatechange and the decarbonization of society (including
conducting energy conservation activities and utilizing
renewable energy) to promote sustainable corporate
management.

(5) Dependence on
specific fields

In the electronics materials business, which accounts for amajor part of the OOC Group’s business portfolio, the speedof technological innovation is fast, and customer needs arecomplex and diverse. Therefore, delayed responses totechnological changes or demand fluctuations may affect thebusiness performance of OOC and its subsidiaries.

We are developing new products and market-oriented
products while working to optimize equipment and staff
allocation. We are also striving to create highly functional
materials needed in a decarbonized society.

(6) Trends in productmarkets due toeconomic fluctuations

The products of OOC and its subsidiaries are used in awide range of fields and may be severely affected bydemand fluctuations in each industry. A drop in productprices due to market fluctuations, the influx of low-priced
products, the emergence of alternative products, etc. may
cause a decrease in profitability and the resulting
write-down of inventories and consequently affect thebusiness performance of OOC and its subsidiaries.

Aiming for a profit structure that is less susceptible todemand trends and other factors, we are implementing
product renewal and increasing the number of our highly
functional, high-value-added product lines.

(7) Acquisitions; capitaltie-ups

Failure to obtain initially expected synergy or other benefits
from corporate or business acquisitions, capital tie-ups,
etc. or the occurrence or discovery of new unexpected
problems due to such events may affect the businessperformance of OOC and its subsidiaries.

When making corporate acquisitions, businessacquisitions, capital tie-ups, and other arrangements, we
conduct detailed research on the target company orbusiness or other investment targets and carefully
consider the risks involved. For investment projects, wecheck the deviation between actual business performanceand initial plans and take countermeasures as necessary.

The suspension of business systems, information leaks,
information system failures, etc. at OOC or its subsidiaries
due to unauthorized access, infection with computerviruses, etc. may cause the suspension of their businessactivities or loss of their social trust and consequently affectthe business performance of OOC and its subsidiaries.

In addition to establishing an information security policy,building an appropriate system management system, andimplementing security measures, OOC strives to ensure
thorough information management through ongoing
employee education as needed.

(9) Litigation

Business operations entail the risk of being involved inconflict with a supplier or third party and consequently in a
lawsuit or other legal proceedings. A major lawsuit filed
against OOC or its subsidiaries may affect their businessperformance.

In addition to complying with laws and regulations, OOC
strives to prevent disputes, litigation, and the realization ofother risks. Moreover, we have a system in place torespond to lawsuits and other legal matters in cooperation
with law firms and other parties.

(10) R&D investments

We continue to make a certain amount of R&D investment
to maintain our technological advantage. However, failure
to achieve expected outcomes may affect the businessperformance of OOC and its subsidiaries.

We have a system in place to respond quickly to market
demands in order to provide products that take advantage
of our advanced and proprietary technologies for specialty
acrylic acid esters in a timely manner.

(11) Workforce recruiting

Failure to recruit a necessary workforce due to a decrease in
the working population caused by the declining birthrate or
failure to obtain and maintain competent human resources
as planned, resulting in a labor shortage, may affect thebusiness performance of OOC and its subsidiaries.

We review our recruitment methods at appropriate times
to ensure that we have the necessary human resources. In
addition to skill development through employee educationand training, we are working to improve employees’
work-life balance and health awareness to create acomfortable workplace.

(1) Procurement of raw
materials; fluctuationsin oil and raw material
prices(2) Impact on production
due to accidents,
disasters, andpandemics

Priority risk
(3) Legal regulation(4) Overseas businessactivities

Priority risk
(8) Information security

37(14) Environmental andclimate change

Basic Business Continuity Planning (BCP) Policy
In the event of a natural disaster, such as a major earthquakeor storm or flood damage, or a serious crisis, such as the
spread of a new strain of influenza, our management andemployees will work together to ensure our business continuity
in line with this Basic BCP Policy with the aim of fulfilling our
responsibilities as a chemical company that supports thefoundation for socioeconomic activities.
We position the following as important duties to be performed
to ensure our business continuity.

Initial responses
Initial responses to a disaster include adopting measures toevacuate employees and prevent secondary disasters.
Therefore, each of our manufacturing facilities conducts
evacuation and other drills, whereby employees confirm thelocation of fire extinguishing equipment and how to use it.

1. Put human life first
Our top priority is to confirm the safety of our employees
and their families and ensure their security.
2. Ensure business continuity through early recovery
We will work to ensure a stable supply through earlyrecovery so that the operations of our clients will not besuspended, in hope of being a company trusted by them.
3. Support the local community
As a member of the local community, we will make every
possible effort to cooperate in evacuating and rescuing local
residents.

Inter-site communication drill
In the event of a large-scale disaster, the use of landline and mobile
phone calls will be restricted due to distribution control. Therefore,
if a large-scale power outage occurs at our business locations, wewill have no means of communication between them.
Therefore, in preparation for large-scale disasters, we haveinstalled IP communication equipment that enables inter-sitecommunication at the OOC Group’s six business locations inJapan (Head Office, Tokyo Office, Kanazawa Plant, Sakata Plant,
Osaka Office, and Shinko Organic Chemical Industry Ltd.).
We conduct periodical drills whereby employees confirm how to
use IP communication equipment and multiple business locations
are actually connected to each other so that inter-sitecommunication will be ensured quickly in the event of a disaster.

38

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

Dialogue between
Outside Directors
We are committed to activities
that help increase OOC’s
corporate value in view of its
sustainable growth over the
medium to long term.

Naoki Enomoto

Takayuki Hamanaka

Outside Director

Outside Director

Now that a governance system has been
established, efforts are being made to
improve its effectiveness.

established corporate governance system. Starting this year, Mr.
Hamanaka will serve as the chairperson of the Board of
Directors, which I believe will help further increase managementtransparency. I believe that, from now on, one of our missions as
outside directors is to further improve the effectiveness ofcorporate governance in the process of system establishment.
Hamanaka: If I have to refer to any corporate governancechallenge OOC has tackled, I would mention that the Company
has worked to meet requirements of the Corporate
Governance Code by having the Nominations Advisory
Committee formulate and implement a succession plan andhaving the Remuneration Advisory Committee devise
remuneration measures. After making significant progress inthese terms, the Company is now in the phase of considering
how to make the PDCA cycle function well in the future. Now
that we have greater opportunities to receive advice frominvestors on the nomination of management personnel andremuneration therefor, I have taken to heart that I mustcompletely fulfill my accountability as a committee chairperson.

Making the Board of Directors a forum
for discussions on improving corporate
value
Enomoto: I believe that the key to improving the effectivenessof corporate governance is to make discussions of the Boardof Directors more productive and, as a prerequisite for that, toimprove discussions of the Management Council and meetingsprior to it. I believe that, for that purpose, outside directors
should check whether discussions within the organization are
deepened effectively. In particular, I hope to make the Board of
Directors a forum for in-depth discussions on essential
questions in management: how to develop technologies as achemical manufacturer and how to promote commercialization

39

E Environment

S Society

Data

Hoping to be an outside director who“proactively speaks out” in light ofvarious management issues

Here is a dialogue between our two outside directors. They
speak on the history of OOC’s corporate governance systemand share their honest views on its current effectiveness. They
also offer their opinions from the perspectives of their
specialties on challenges OOC should tackle to achievesustainable growth in the future.

Enomoto: Mr. Hamanaka, you have served as an outside
director for about eight years. What is your view on the historyof OOC’s corporate governance?
Hamanaka: When I was appointed as an outside director in
2016, it was the era of CEO Shizume, the second CEO fromthe family of the Company’s founder. Unlike today, theCompany did not have a Nominations Advisory Committee,
and its management system looked like that of a kind of family
enterprise. In such a situation, my appointment increased thenumber of outside directors to two. After that, the Nominations
Advisory Committee and the Remuneration Advisory
Committee were established in 2018. Moreover, in 2019, it was
decided that an outside director would serve as chairperson ofeach of these committees in place of the CEO. In 2020, theprescribed number of directors was reviewed to increase theratio of outside directors to 1/3. I have the impression that
rapid progress has been made in the enhancement ofcorporate governance for these several years. This progresshas also made discussions by the Board of Directors and theManagement Council more open.
Enomoto: It has been about a year since I was appointed as an
outside director, and I recognize that OOC has in place a firmly

G Governanceand sales.
Hamanaka: Investors both inside and outside Japan often
ask me, “Why are stock prices of Japanese companies solow?” I also sometimes hear complaints about the fact thatmany listed companies in Japan have a price-to-book ratio(P/B ratio) of 1 or lower. There may be various reasons, but
we should not overlook corporate governance challenges left
unsolved as one of those reasons. In that regard, I believethat an important role of outside directors is to increase
OOC’s corporate value by further enhancing corporate
governance. However, as far as I know about the frontline ofbusiness execution, the Company is actively committed tocomplying with the Corporate Governance Code anddisclosing of non-financial information. So, we as outside
directors have never made any complaints. If anything, I
believe that some measures should be adopted to ensurethat the Board of Directors can function as a supervisory body
focusing on corporate governance. One possible measure isto have the Management Council or other subordinate bodies
discuss some of the resolutions that are now being discussed
by the Board of Directors. I think this may be a challenge tobe solved from now on. Moreover, OOC is currently acompany with auditors, but accelerating global expansion in
the future requires the Company to solve the challenge of
becoming a company with an audit and supervisorycommittee. Discussions on how to solve it have already been
initiated.
Enomoto: Without a doubt, all directors, whether internal oroutside, share awareness of the challenges that stakeholders
currently want the Company to solve or that will arise in the
future, including the ones Mr. Hamanaka just mentioned. I
believe that, from now on, we as directors should deepen our
discussions on each of the challenges and accelerate initiatives
to solve them.

Hamanaka: With regard to further deepening discussions of
the Board of Directors, I would mention that OOC’s outside
directors attend not only each Board of Directors meeting but
also the Management Council meeting held prior to the former
to participate in discussions. Many other companies only giveoutside directors a briefing on the conclusions of aManagement Council meeting before they attend the following
Board of Directors meeting. Therefore, outside directors’
participation in both kinds of meetings is one of the uniquefeatures of OOC. There would be a huge gap in the density of
discussions of the Board of Directors between a company
where outside directors attend a Board of Directors meeting
after merely listening to a lecture on the conclusions of theManagement Council meeting prior to it and a company whereoutside directors not only witness but also take part in spirited
discussions of the Management Council.
I believe that, in this favorable environment, we as outside
directors should be responsible for pointing out fundamental
management issues from our perspective as a representativeof shareholders and investors. One of the missions of outside
directors in particular is to raise issues that people inside theCompany are hesitant to talk about. Furthermore, although
OOC’s return on equity (ROE) is currently high, I believe we as
outside directors should remain keenly aware of the need to
improve capital efficiency. I myself hope to be an outside
director who “proactively speaks out” about management
issues in view of the Company’s sustainable growth in the
future.
Enomoto: As Mr. Hamanaka stated, it is important for outside
directors to take the perspective of stakeholders, of course. As
is often pointed out, outside directors have a mission ofchecking against management’s reckless behavior, but I do notbelieve we have to fulfill that mission at OOC. Rather than that,
it is crucial for us to accurately assess potential future risks to
the Company from an external standpoint and discusscountermeasures with other members of the Board of
Directors and the Management Council.
In addition, as symbolized by the Osaka Yuki Productive
Maintenance (OYPM) activities, which I witnessed on a plant
tour I made soon after I assumed the position of outside
director, OOC is continuing high-quality production activities
through the PDCA cycle. I believe that another mission ofoutside directors is to leverage such various underlying
strengths of the Company to improve its corporate value.
Going forward, I will fulfill my missions as an outside director,
including enhancing the company’s non-financial value by
strengthening its workforce.

40

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

E Environment

G Governance

S Society

Data

E Environment

Environmental Initiatives

Climate Change Initiatives

Amid rising awareness of natural environment preservation and increasing activities for environmental protection,
the OOC Group is working hard to contribute to the formation of a sustainable recycling-oriented society throughinitiatives designed to promote harmonious coexistence with the Earth and society. In view of the international trend
in the management of chemicals, the Group’s activities are designed not only to prevent environmental pollution incompliance with laws and regulations, but also to reduce environmental impact while promoting and improving thevoluntary management of chemicals.

Responses to the TCFD Recommendations

The Sustainability Committee was established as anorganization to carry out initiatives for building OOC resilience.
This organization is composed of cross-organizational
members led by the CEO.
Important matters, such as basic policies, are deliberated andresolved by the Board of Directors while other matters aredeliberated by the Sustainability Committee (twice a year), anddeliberation results are reported to the Board of Directors

Company activities designed for coexistence with the Earth and society
Building global partnerships to enable sustainable development
Managing chemicals and reducing waste throughout product lifecycles● Proactive use of resource recycling and use of renewable energy●●

State of Environmental Impact
identifying how much we reduce or reuse the resources we
consume and discharge.
Various ESG data is available on our website.

■ Governance System Diagram

Raw materials

Water

47,100 metric tons

5.80 million metric tons
Breakdown

Outside company
Re-refining Collection Reuse

Total energy

15,993 KL

Electricity

7,290 KL

Heavy oil

4,418 KLNatural gas

4,275 KL

Other

10 KL

CO2 circulation

OOC Group

Forests

Shipping

Plastic container/
drum collection

Clients

Production quantity:
40,300 metric tons

Absorption

OUTPUT

Reuse of waste
oil and waste
solvents: 2,200
metric tons

The OOC Group performed scenario analysis on opportunities
and risks created by climate change for its business inaccordance with the TCFD framework based on the conditions
summarized below.
For the analysis conditions, we developed two scenarios:
1.5ºC scenario and 4.0ºC scenario. The former represents the

Atmospheric emissions

Emissions to bodies of waterCO242,300 metric tons

COD load

17.7 metric tons

SOX

6.2 metric tons

SS load13.3 metric tons

NOX

15.6 metric tons

PRTR substances

17.9 metric tons

Waste oil, plastic,other waste
Waste discharge
Amount of industrial 20,400 metric tons
(20% recycling rate)
waste generated
Amount treatedin-house
Amount discharged
externally

13,200 metric tons
(65% in-house
treatment rate)

7,200 metric tons

Final landfill disposal 132.2 metric tons
(0.6% final disposal rate)
amount41

situation where various measures are taken to curb climatechange, and the latter represents the situation where no suchmeasures are taken.
We also identified opportunities and risks for the businesssegments of OOC under the same conditions.

■ Analysis Conditions
Ref
Reference conditions

Plastic container/
drum collection

The OOC Group works to reduce the amount of waste
and emissions generated by its business activities.

Corporate officers, departments, and affiliates

Sustainability Committee

Scenario Analysis

Year
OOC
FutureForestprogram(tree
planting
initiative)

Management Council

Report(Note: Energy consumption quantities are given as crude oil equivalent.)

R&D/production activities

CEO

Risk/Compliance Committee
EnergyUse of natural
materials suchas pine andcorn

Suppliers

Board of Directors

AgendaThe OOC Group works to reduce energy and resource consumption.

Business activities(twice a year) for its deliberation and approval as necessary.
Any new risks identified are discussed by the Risk/Compliance
Committee first, and if deemed relevant to the TCFD, theSustainability Committee conducts a scenario analysis andidentifies key risks.
The analysis results are reported to the Risk/Compliance
Committee and the Board of Directors.

ReportInternal Control Committee

INPUT

The OOC Group will strive to win the trust of society andstakeholders by incorporating the climate change-related
initiatives it has conducted to date into a framework based on
the TCFD recommendations and by disclosing information on
the risks and opportunities it has analyzed.

GovernanceMedium-term Policy (2020–2024) Issues

The OOC Group works to accurately identify how we affect theenvironment through our business activities, from raw material
procurement to production, disposal, and recycling. We work to
reduce environmental impact by qualitatively and quantitatively

In response to risks and opportunities related to climatechange, the TCFD recommendations are recommendations fordisclosure of information on the following four areas:
Governance, Strategy, Risk Management, and Metrics andTargets.

2020

1.5°C scenario

4.0°C scenario

IPCC：SSP1-1.9
IEA-WEO：NZE

IPCC：SSP5-8.5
IEA-WEO：STEPS

2030

2050

2030

2050

Global CO2 emissions(Gt-CO2)

26

0

37

34

Carbon taxes (USD/t-CO2)

15 to 90

55 to 200

0

0

23%

25%

Ratio of electrical energy in totalenergy consumption (industry)

22%

28%

46%

Mix of power sources
Coal and petroleum
Natural gas
Nuclear energy
Renewable energy

Coal and petroleum: 38%
Natural gas: 23%
Nuclear energy: 10%
Renewable energy: 28%
Other: 1%

Coal and petroleum: 9%
Natural gas: 17%
Nuclear energy: 10%
Renewable energy: 61%
Other: 3%

Coal and petroleum: 0%
Natural gas: 0%
Nuclear energy: 8%
Renewable energy: 88%
Other: 4%

Sea level rise (through 2100)

0

Average annual precipitation(through 2100)

Coal and petroleum: 27% Coal and petroleum: 14%
Natural gas: 21%
Natural gas: 18%
Nuclear energy: 9%
Nuclear energy: 8%
Renewable energy: 42% Renewable energy: 60%
Other: 1%
Other: 0%0.28 to 0.55 ｍ

0.63 to 1.01 ｍ

Increase by 0 to 5%

Increase by 1 to 13%42Integrated Report 2023

■ 1.5°C Scenario
Transition/
physical

Item

Description
To reduce energy costs by increasing efficiency of
production and transportation● Lower prices of solar panels, wind power generation, andpower storage equipment

Term

Mediumterm

ImpactSmall

Opportunities●

Diversify the sources of raw materials andtransportation methods

Curb electricity costs by introducing off-grid
power generation equipment, such as solar
power, wind power, etc.
● Purchase green electric power or electric power
generated from renewable energy sources● Develop products suitable for resource saving

Increase in costs to meet tighter GHG regulations
Increase in manufacturing and shipping costs due to soaring
crude oil and electricity prices● Increase in operating costs due to carbon pricing
Estimated cost increases if GHG emissions are not reduced
In 2030: 80 to 490 million yen
In 2050: 300 to 1,080 million yen

Short
term

Small

Short
term

Medium●Curb total GHG emissions by streamlining
manufacturing processes

Consider switching raw materials● Curb heavy oil consumption and reduce
disposal cost by using heat from waste oilboilers and other sources

Short
term

MediumIncrease in business opportunities due to increase indemand for environmentally friendly technology

Risks

Increase in investment and R&D costs for environmentallyfriendly technology

Short
term

Small

Opportunities

Improvement of corporate image through enhanced
disclosure of climate-related information

Short
term

Small

Decline in the value of corporate brand due to delay inresponses

Short
term

Medium●Provide timely information disclosure

Downgrades of external assessment due to a lack of
information disclosure

Short
term

Medium●Enhance information disclosure

Description

Term

ImpactDecline in capacity utilization at business sites due to asudden disaster● Shutdown, fire, or leakage caused by a typhoon, tsunami, etc.
● Logistics disruption caused by heavy snowfall

Long
term

Interruption of operations due to disaster damage tosupply chain● Shutdown of suppliers and manufacturers due to disaster damage

Long
term

Medium●Spread of an epidemic
Decline in production and shipping efficiency due to epidemic
infection of employees

Long
term

Small

Chronic climate change (sea level rise, temperature rise,
etc.)

Long
term

Small

Risks

●

Develop decarbonized energy technology andprovide a wide range of energy technologies■ 4.0°C Scenario

Acute

Risks /
Opportunities

Risks

Physical

Chronic Risks

43

Term

ImpactOpportunities

Increase development projects or obtain new themes byadding new functions, such as energy saving andefficiency improvement

Short term

Small

Risks

Decline in product competitiveness due to soaring heavy
oil prices, increase in raw material, process, andtransportation costs, and soaring product prices causedby GHG emission regulations

Short term Medium

Replace raw materials for existing products with
bio-derived raw materials

Mediumterm

MediumExpand OOC’s share of materials for UV curing by capitalizing
on increase in demand for energy saving processes

Short term

Small

Decline in product competitiveness due to increase in thecost of distillation processes

Short term Medium

Supply shortage of biomass raw materials due toincrease in demand for themMediumterm

Small

Increase own product sales by capitalizing on increase indemand for cosmetics with reduced environmental impact

Short term

Small

Increase own product sales by capitalizing on increase indemand for cosmetics for heat care, such as cooling cosmetics

Short term

Small

Increase in demand for semiconductor products resulting
from the shift to high-speed communications, larger data
volume, and faster processing, which is caused byincrease in demand for power saving

Short term

Large

Increase in demand for semiconductors due to the advancementof indoor IoT as a result of increase in indoor activities

Short term Medium

Risks

Major changes in manufacturing methods due to increasein energy costs and associated significant decrease indemand for materials

Opportunities
Risks

CommonOpportunities
Chemicalproducts

Specialty
Opportunities
chemicals

Opportunities●

Opportunities
Technology

Item

Description

Risks

Estimated cost increases if GHG emissions are reduced inaccordance with the reduction targets of OOC
In 2030: 60 to 360 million yen
In 2050: 0 yen
Higher prices and/or procurement difficulty of certain
materials to meet tighter GHG regulations● Increase in costs of raw materials, such as naphtha● Increase in disposal costs, such as cost of disposing of waste oil

Transition/
physicalBusiness
Risks /
domains Opportunities●

Transition

Reputation

Responses●

To reduce procurement costs as a result of the general
acceptance of renewable energy● Development of products suitable for resource saving

Risks

E Environment

G Governance

S Society

Data■ Opportunities and Risks Related to Business

Risks /
Opportunities

Policiesandregulations

Promoting
Sustainable Management

OOC’s Value Creation

Decrease in the precision of manufacturing processes andincrease in management costs due to temperature rise
● Decline in production efficiency due to the deterioration of working
environment or work-related injuries at manufacturing sites● Increase in electricity costs due to need for stronger air conditioning● Decline in preservation stability in non-refrigerated warehouses
due to storage temperature rise
● Decline in product stability during transportation

Long
term

Destabilization of supply of natural resources, water,electric power, raw materials, etc.

Long
term

Large

ShinkoOrganic●●●

Obtain market information on an ongoing basis
and strengthen development on new themes●

Reduce the man-hours in heavy oil processesor replace them with electric processes●

Expand the line-up of products that use bio-derived
raw materials, such as biomass acrylate●

Promote the sales of materials for UV curing●

Reduce the man-hours in heavy oil processesor replace them with electric processes●

Secure and diversify the supply sources ofbiomass raw materials●

Develop materials for cosmetics with reduced
environmental impact●

Promote the sales of cosmetics for heat care●

Enhance manufacturing facilities for materials
for semiconductors

Long term Medium●

Obtain industry information from customers on
an ongoing basis

Increase in demand for solvents for semiconductors due toincrease in demand for semiconductors

Short term Medium●

Consider enhancing manufacturing facilities

Decrease in demand for solvents for paints due to increasein demand for energy saving processes

Short term Medium●

Obtain market information on an ongoingbasis and develop new themes

CO2 Emission Reduction Targets and Measures
The OOC Group has recognized the importance of addressing
climate change through a transition to a decarbonized society,and medium- to long-term targets have been set by OOC’s
Carbon Neutralization Study Committee established in 2021.
For the business segments of the Company, we have also

Responses

Implement supply chain management toachieve sustainable procurement●

Educate employees on symptoms, control
measures, etc. of infectious diseases andprepare response flows●

Enhance resource-saving features of products

Enhance break rooms and install local coolingfans● Establish management standards that takeaccount of climate change and consider theuse of 25ºC temperature warehouses● Evaluate the necessity for temperature
management during transportation

identified specific measures to achieve the targets as shownin the table below, in addition to those rationalization andenergy saving measures that we have been implementing. We
will strive to achieve carbon neutrality by meeting thesetargets.

Reduction targets(as compared with fiscal 2013)

Specific measures

Short term

15% or more by fiscal 2024

Reduce environmental impact and Scope 1 CO2 emissions through the reuse of waste solvents
Develop biomass products● Reduce Scope 2 CO2 emissions by introducing renewable energy sources (such as solar panels)● Reduce Scope 2 CO2 emissions through the purchase of green electricity

Medium term

30% or more by fiscal 2030●

Long term

100% or more by fiscal 2050

Reduce Scope 1 CO2 emissions by considering the introduction of energy sources that use carbon-free fuels(such as H2 and NH3)
● Reduce Scope 1 CO2 emissions by reusing CO2 by way of fixation and conversion of CO2 into valuables●

Develop BCP measures at each site

●

Small

Electronics
materials

Responses●

Reduce Scope 1 CO2 emissions by promoting the shift of energy sources from heavy oil to electricity●

Metrics and Targets
Toward a decarbonized society, we have set the following measurement and reduction targets for CO2 emissions from the Company’s own
activities (Scopes 1 and 2) and indirect CO2 emissions (Scope 3):
Scope 1 + 2●●

Reduce CO2 emissions by 30% by 2030 (as compared with fiscal 2013)
Reduce CO2 emissions by 100% by 2050 (as compared with fiscal 2013)

Measure Scope 3 CO2 emissions by 2023
Announce a reduction roadmap by 2025
● Reduce CO 2 emissions by 100% by 2050 (as compared with fiscal 2023)●

Medium●Monitor and address water risk and diversify
the sources of raw materials

Scope 3●44

Integrated Report 2023

OOC’s Value Creation

Initiatives to Achieve Carbon Neutrality

Under the Long-term Business Plan that started in fiscal 2015
(Next Stage10), the OOC Group has focused on electronics
materials while promoting business reforms by reviewing
unprofitable businesses. As the Group continues to achievesales and profit growth, heavy oil usage has decreased whileelectricity usage has increased. As a result, CO2 emissions
have been consistently declining.

Changes in CO2 emissions and CO2 reduction rate(based on fiscal 2013)
Effects of Plan 14

Unit: Thousandsof metric tons

50.0

Effects of Next Stage 10 business reforms

46.1

47.3
45.0

10.9

44.3

6.3

40.0

45.7

42.8

0.0
2013

2014

2015

12.0

12.0

42.3

4.2
35.0

9.0

2016

1.7

2.2

2017

2018

6.0

5.0

3.0
2019

2020

2021

0.0
2022 (Fiscal year)

CO² reduction rate (based on fiscal 2013)

Changes in CO2 emissions and gross profit margin intensity index(based on fiscal 2013)
Unit: Thousandsof metric tons

50.0
45.0

Effects of Plan 14

Effects of Next Stage 10 business reforms
Unit: %

48.1
100

47.3

46.1
87

42.8
75

40.0

67

120

47.0

45.0

44.3

30.0

2013

2014

2015

2016

45.7
42.6

42.3

90
60

62

57

55

35.0

■CO² emissions

Kanazawa Plant,
Sakata Plant

11.3

42.6

■CO² emissions

The Group will work to use energy more efficiently by
pursuing the goal of improving the energy consumption
efficiency rate by 1% or more every year (by 8% over five
years as a medium-term plan target for plants) in accordancewith the guidelines provided for by the Act on the Rational
Use of Energy. As energy consumption continues to rise
every year, the Group also plans to install solar power
generation equipment (Sakata Plant) and a combustion boiler
for waste solvents (Kanazawa Plant).

14.0

47.0
8.0

OOC Group’s CO2 Reduction Measures

2017

2018

2019

48

2020

42

39

2021

0
2022 (Fiscal year)

30

Gross profit margin intensity index (based on fiscal 2013)● Use of exhaust heat from drains
Recycled use of solvents● Use of waste solvents as boiler fuel● Regular inspections and maintenance of steam traps● Solar power generation facility installation plan (Sakata Plant) ● Construction of new facilities (introduction of equipment satisfying the Top Runner Standard)●

Development of manufacturing technologies and products that contribute to resource/energy saving
Replacement of air conditioners (Kanazawa Laboratory)

Osaka Office,Kanazawa Laboratory●

Head Office Plant of Shinko
Organic Chemical Industry●

Head Office●

Reduction of electricity usage by 50% through head office relocation (including the effect of increased working from home)

All offices●

Energy saving measures implemented through temperature management of air conditioning and rationalization of indoor/outdoor lighting●

Curbing the Discharge of Industrial Waste
The Group works to further reduce environmental impact
through activities that put the three Rs (reduce, reuse,recycle) into practice. These activities are designed toreduce the amount of industrial waste generated while
making effective use of limited resources by consistently
sorting generated waste and recycling more of it. We havealways promoted in-house recycling by using byproduct oil
treatment systems to turn waste oil into fuel and waste
solvents into boiler fuel. The recycling rate for fiscal 2022
was nearly the same as in the previous year at 19.7%(down 0.2 percentage points).
As part of activities to promote resource recycling, we plan
to install a boiler that uses waste solvents as fuel after
evaluating various waste oil disposal methods. Having
completed environmental assessment this fiscal year, we
aim to start actual operation next fiscal year.

Fiscal 2022 result: 19.7% Fiscal 2024 target: 25% or more

Recycling rate

Changes in waste data
Unit: Metric tons

Unit: %

25,00020,00015,00017.5

18,09917,304

15,662

0

5,959

6,498

129

177

133

20.0

20,469
15.0

7,926

7,452

6,741

19.7

20,987

19,053

17,835

5,629

2016

19.9

19.3

18.9

10,000
5,000

25.0

21.5
18.8

7,219

10.0
5.0

2017

2018

■Amount of industrial waste generated■Landfill disposal

143
2019

170

137
2020

2021

132

0
2022 (Fiscal year)■Waste discharged externally

Recycling rate(based on fiscal 2015)

OOC Future Forest Program
Ishikawa Prefecture is undertaking the “Corporate Forest
Support Promotion Project” in order to support forest
conservation activities by businesses. OOC’s Kanazawa Plant
has participated in these activities every year since 2010.

In 2022, 20 people (14 employees and six family members)
participated in forest conservation activities, including
supplementary planting of 30 trees and additional fertilization,
after implementing measures to prevent coronavirus infection.
CO2 absorption

Introduction of energy saving equipment (such as inverter-controlled high-efficiency heaters) as part of equipment renewal● Reduction of energy consumption rate through manufacturing process improvements

Unit: t-CO2

2

1

0

0.9

2015

1.4

1.5

2018

2019

1.7

1.8

1.8

2020

2021

2022

1.1

2016

(Fiscal year)

A Sustainability Committee has been established to deal with issues
related to sustainability in general following the establishment of the
Carbon Neutralization Study Committee in 2022. The Sustainability
Committee will also discuss any measures toward carbon neutrality.

Fiscal 2022
result12%

Fiscal 2024 Fiscal 2030 Fiscal 2050
Fiscal 2023
(medium-term (medium-term (long-termtargettarget)target)target)14％

15% or more 30% or more

Net zero

CO2 emissions
Unit: Metric tons

Preventing Air Pollution
Preventing air pollution through measures such as rationalizing
the operation of boilers and incinerators has always been an
area of focus for the Group. We are also working on further

reducing atmospheric emissions of hazardous substances. In
the future, we will continue to monitor emission equipment on
an ongoing basis and make efforts to reduce our emissions.

Energy saving, process improvements, the use of waste oil, etc.

50,00040,000Purchase of green electricity

30,000Purchase of green LNG

20,000Introduction of heavy fuel oil substitutes

10,000CO2 emission reduction by new decarbonization technologies

0
2020

2030

2040

2050
(Fiscal year)

45

Data

Products we see and use every day use many materials made from chemicals. Chemicals are indispensable for us tolead an affluent life and maintain convenient and comfortable living conditions. On the other hand, we consume raw
materials derived from oil as well as a large amount of energy in the course of producing such materials. The produced
materials are discharged into the environment, such as the air, rivers, seas and other waters, and soil, after they are usedin our daily lives and business activities. While environmental issues have changed rapidly in recent years, the OOC Group
as a material manufacturer continues to conduct its activities aiming to ensure product safety and reduce environmental
impact, as well as to prevent environmental pollution in production processes in compliance with laws and regulations.
As in previous years, there was no serious environmental compliance violation, such as a disaster, in fiscal 2022. In orderto ensure business continuity, the Group will continue to conduct its activities in a manner friendly to the global
environment by ensuring that each employee understands the importance of legal compliance and disposing of any
waste by appropriate methods as it arises.

Sustainability Committee

2010

S Society

Unit: %

48.1

45.0

30.0

E Environment

G GovernanceInitiatives to Reduce Environmental Impact

Climate change caused by global warming and the sustainability of modern society have emerged as international
concerns. As part of measures to address this urgent issue, the Paris Agreement and related decisions obligated all
countries to make efforts to formulate and submit a long-term strategy for achievement of lower GHG emissions. In
response to this, the Japanese government declared in October 2020 that it would aim to achieve carbon neutrality by
2050. The chemical industry is the industrial sector with the second highest CO2 emissions, behind only the steel
industry. The OOC Group also consumes a large amount of energy in conducting its business. The Group is working
toward a carbon-neutral, decarbonized society with a long-term goal of resolving significant decarbonization issues whileconsidering the effective use of waste as energy sources in the medium term and implementing the introduction of solar
power generation equipment and the purchase of green electricity in the short term.

Past Steps toward a DecarbonizedSociety

Promoting
Sustainable Management● Electrification of heavy oil processes● Development of carbon negative materials

Preventing Water Pollution
The Group’s wastewater treatment processes are continuallymonitored as we work to prevent water pollution by meeting
regulatory values. As part of this work, we make ongoing efforts
to reduce environmental impact on bodies of water by

rationalizing the operation of activated sludge treatment facilities
and wastewater incinerators.
Although the level is well below the regulatory value, we willcontinue to work on reducing it further through steady monitoring.

46

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S SocietyData

S SocietyOccupational Health and Safety
The main objectives of occupational safety and health are to maintain the safety andhealth of employees and to prevent disasters and accidents.
In addition to complying with the Industrial Safety and Health Act and related laws
and regulations, the OOC Group is committed to promoting the health of its
employees. As a result, we are working to improve the health of our employees andour organizational culture because healthy employees and a healthy organization
lead to higher labor productivity.

Organizational Structure for Occupational Safety and Health(Osaka Organic)
CEO

Tokyo Office2(Dec. 2021 to Nov. 2022)

Osaka Office

Kanazawa Sakata
Plant
Plant

Sakata Plant

Occupational Health and Safety Organizations
Subordinate organizations and their main roles
Fire Fighting ....................... Fire and disaster prevention planning and promotion for plants andmaintenance and management of fire extinguishing systems, fire extinguishers,
Subcommittee
hazardous materials facilities, etc.
Environmental Sanitation ....... Planning and advice on maintaining the workplace environment, inspection andinvestigation of safety and health and protective equipment, guidance on
Subcommittee
first-aid equipment inspection, etc.
Health Promotion................... Planning and promotion of sports events for all employees to participate in for
Subcommittee
the purpose of promoting healthInspection Subcommittee ...... Premises inspection planning, implementation, and follow-up
Zero Accident Education ....... Assessing and summarizing the status of Zero Accident Team initiatives,
planning participation in external training sessions, etc.
Subcommittee

All Business Sites

Installation of an AED

Installation of IP communication devices

We installed an AED inside the head office.

In order to secure means of communication in
emergency situations, we installed small IP
communication devices at each business site.

Osaka Shinko
Office Organic

Poisonous Materials Handling
Education & Training●

Carrier Service Staff Education& Training

●

●

●

Static Electricity Education &Training●●●

Evacuation Drills●

Firefighting Drills

●

●

●

Emergency Response Test
(Odors, leakage, fires,
polymerization hazard, etc.)

●

●

●

Fire Fighting Equipment Education& Training (Fire hydrants,
automatic fire alarms, etc.)●

High-Pressure Gas Education& Training●

Health & Hygiene Education& Training

●

●

●

●

●

In this fiscal year, everybody at the Osaka Officeparticipated in firefighting drills using fire
extinguishers and indoor fire hydrants,
evacuation drills using emergency ladders, andreporting drills based on a mock fire in the
research building.

47

Sakata Plant●

The Sakata Plant prepares an annual security management plan at the beginning of each year and conducts various education and training sessions suchas firefighting drills, leakage control drills, and 4RKYT (four-round hazard prediction training). Also, through monthly health and safety meetings, we uncovernear-misses and share information on new raw materials and equipment, and through risk assessments, we reduce sources of danger to create a safe andsecure environment.
Leakage control drills

Firefighting drills

COVID-19 prevention measures

Leakage control drills are conducted each shift, including
regular work, to prepare for any leakage of chemicalsolutions.

Firefighting drills are conducted each shift, including
regular work, by assigning specific roles to individuals
and assuming the occurrence of an earthquake and fire.

In the third year of the pandemic, the Plant’s COVID-19
prevention measures included regular temperaturecheck, hand disinfection, and the use of acrylic platepartitions and air purifiers with an HEPA filter, as well as
ventilation and disinfection in site offices at the time ofshift handover and in the cafeteria and changing roomsin the morning and at lunch time.
In addition, group influenza vaccination in the plant isavailable for those who wish to receive it.

●

●

●

●

Welding Fumes Education &Training●

Training in Handling Fire
Extinguishing Equipment●

Fire Fighting Equipment
Education & Training(Chemical firefighting truck)●

General Disaster Preparedness
Drills●Safety Control Techniques●

Waterways flowing
through the premises of
the Osaka Office werecleaned. As weed andsand were removed, it
became easier to monitor
the waterways. As aresult, infestation of flylarvae was prevented andthe work environment
improved.

●●

Prevention Regulations

Waterway cleaning in the premises

After improvement●

Terminal Recovery Training

General disaster preparedness drills

Before improvement●●

Health Risks from Chemical
Substances

Aiming to create a safe and comfortable work environment, the Osaka Office isconducting improvement activities based on discussions at the monthly meetingsof the Safety and Health Committee. In addition, it holds various education andtraining sessions, such as emergency drills and education on fire prevention andfirefighting equipment, in accordance with the annual safety and security
management plan.

COVID-19 prevention measures
Rice scoops, which had
been shared among
employees to scoop
rice, were replaced with
automatic rice scooping
machines in theemployee cafeteria toeliminate any risk ofinfection arising from thesharing of rice scoops.

●

Education on Carcinogenicity
Guidelines

Osaka Office

Disaster prevention drills
The Kanazawa Plant
has established an
in-house fire brigade
consisting of
headquarters units anddivisional units assigned
to each workplace.
Leaders of
headquarters units are
required to complete a
firefighting training
program, and leaders ofdivisional units are also
encouraged tocomplete the program.

●

Risk Assessment Education& Training
Emergency/First Aid/Protective
Gear Education & Training

Kanazawa Plant
The Kanazawa Plant holds education and training sessions on such topics as safety and health and disaster prevention in accordance with the annual
safety and security plan. The Plant also established a Disaster Prevention and Safety Division in December 2021 to start initiatives on its specific business
continuity and disaster prevention responses to any unprecedented disasters.

Period covered: December 2021 to November 2022

Kanazawa Plant

Head Officein the OOC Group

Fiscal 2022 Safety, Security, and Disaster
Preparedness Training Results (OOC Group)

Administration Division

Head Office

Number of lost time injuries

Chokai One-day March●●“Two-day march” is an excursion event that is held
nationwide in Japan. However, as part of efforts tocontrol COVID-19, the town of Yuza held a similar eventin the form of a one-day walk this year. The Plant
participated in this event to encourage exercise for healthpromotion.

●

Shinko Organic
As a company that handles chemicals, Shinko
Organic strives to ensure safe plant operations,with its first priority on the prevention of fire, butalso without failing to prepare for natural disasters,such as earthquake, high tide, and storm.
Joint comprehensive disaster prevention drills
A comprehensive disaster prevention drill (“Kobe Area
Petrochemical Complex Special Disaster Prevention Council
East Area Comprehensive Disaster Prevention Drill in 2022”)
was conducted jointly by the local fire station (Higashinada-ku,
Kobe), Shinko Organic’s in-house fire brigade, and nearby
OOC business sites for rehearsing responses at petrochemical
facilities during a Tonankai Trough earthquake.

48

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Interactions with Local Communities(Contribution to Regions in Which OOC Business Sites Are Located)

Kanazawa Plant Reducing environmental impact and improving the safety of our operations at this main plant
The Kanazawa Plant began operating in 1981 as the OOC Group’s second factory, and sincethen it has developed to become our main plant. The Kanazawa Plant faces the holy mountain
Mount Haku and effectively uses the precious resource of underground water from there in its
production activities. We use the plant’s state-of-the-art technology to carry out manufacturing
activities that contribute to society. We are also actively moving forward with a range of initiatives
for achieving sustainable manufacturing that is energy efficient and eco-friendly. These include
improving production processes, installing energy-saving equipment, and using renewableenergy sources. Additionally, through organizing and taking part in various community social
action programs, Kanazawa Plant employees are establishing closer ties with local residents.

Sakata Plant

Production that also values precious natural capital

The OOC Group started operations at the Sakata Plant in July 2000 as its then-third plant witha floor area of 114,000 m2. Overlooking Mount Chokai, which is also called the Dewa Fuji, andlocated on the Shonai Plain fed by the Mogami River, the industrial park is situated on stableground with little risk of natural disasters, and aims to be a forest plant that coexists with thelocal community. As a chemical manufacturer, we implement safety-first production initiatives
while being conscious of the need to reduce our environmental impact and save energy.
Furthermore, we are committed to living in harmony with the local community and participate invarious social contribution initiatives to deepen our interaction with the community.

Kanazawa Plant(including the Kanazawa Laboratory)

Blood donation drives

Clean Beach Ishikawa in Hakusan

As a member of the Matsumoto Industrial Park
Council, the Kanazawa Plant has been cooperatingwith the Ishikawa Prefecture Red Cross Blood Centerin blood donation activities since 2010 by offering avenue inside the Plant. Although it has been difficult
to secure sufficient blood in recent years due to the
COVID-19 pandemic, we will continue to conduct
blood donation activities going forward in order tosave the lives of as many people as possible.

Clean Beach Ishikawa is a movement to protect thecoastline of Ishikawa Prefecture, which extends 583
km. Each municipality along the coastline conducts
cleaning activities on their respective cleaning days.
The Kanazawa Plant participated in cleaning
activities conducted along Tokumitsu Beach in
Hakusan City in May.

Location: 1600-1 Matsumoto-machi,
Hakusan-shi, Ishikawa
Established: June 1981
Employees: 241 (as of November 30, 2022)
Main products: Semiconductor materials,
coating and adhesive materials,
resin raw materials, etc.

Sakata Plant

Blood donation drives

Shonai My Road Support project

The Sakata Plant conducted blood donation activities
inside the plant in cooperation with the Yamagata
Prefecture Red Cross Blood Center. Plant employees
and employees of companies in the neighborhood
participated in blood donation.

The Plant participated in the project again this year,
and beautiful daffodils bloomed along the roadadjacent to the Plant as a result of planting.

Location: 157-23 Shigerimatsu, Fujisaki,
Yuza-machi, Akumi-gun, Yamagata
Established: July 2000
Employees: 41 (as of November 30, 2022)
Main products: Patterning materials for liquid
crystal displays, cosmetics
materials, coating resin raw
materials, etc.

Yuza
Commerce andIndustry Fair

Donation of emergency rations<Food drive>
In June, the Company donatedpreserved food (250 servings ofshrimp pilaf) whose best-before
date is August 2022 as part ofcooperation with the local fooddrive organized by the Hakusan
Chamber of Commerce under
the campaign to collect surplus
food from households and othersources and donate it to the
local social welfare council as
relief supplies to needy people.

<Childcare Section andWelfare Overall
Coordination Office,Health and Welfare
Division, Hakusan City>
In August, the Plant donated 10boxes of cookies to the Childcare
Section, Health and Welfare
Division, Hakusan City.
The cookies were donated in turnby the Childcare Section to thechildren’s cafeteria in the city.

Shonai Beach clean-up
activities<Received an appreciation
letter from Hakusan City>
The Plant received a letter ofappreciation from Hakusan City in
October in appreciation of these
activities.

Osaka Office A hybrid office functioning as a West Japan distribution center and information-intensive laboratory

Under a blue sky, 10 employees of the
Osaka Office participated in a softball
tournament organized by the Kashiwara
City Crime Prevention Association.

49

The Osaka Officeconducts cleaning andweeding activities aroundthe office on a monthly
basis as part of its safety
and health activities.

In January 2023, a new year’s
parade of firefighters was held
jointly by the Kashiwara Habikino
Fujiidera Firefighting Associationand local constituents for the firsttime in the last three years. OOC
participated in the parade as acorporate constituent.

Yuza Whole Town
Beautification movement(Sea cleaning movement)

The Plant conducted forest
maintenance volunteer activities as
its annual event. The plant
employees worked with many local
residents and children to maintainthe pine forest, which serves as awindbreak, by pruning the lower
branches of the pine trees. As thework was completed, the pine forest
became neat with a clear view.

The town of Yuza organizedcleaning activities also this year,
and the Plant participated in thecleaning of beaches in the Hattori
Koya area. Plant employees
collected a truckload of garbage
as a result of activities thatstarted in the early morning.

The Plant participated in Shonai
Beach clean-up activities
organized by the Yamagata
Prefecture Environmental
Conservation Association andcleaned up Ohama Beach in
Sakata City. A workshop washeld after the clean-up activities,
and the Plant participated in a
lecture titled “Marine Plastic
Waste Problem – Thinking
about the Future from the
Perspective of the Connection
between Town, River, and Sea.”

Steps toward becoming a small, but safe and state-of-the-art chemicals manufacturing plant

Osaka Office (including Osaka
Laboratory/Advanced Technology
Research Institute)
Cleaning around theofficeForest maintenancevolunteer activities(Nishiyama Venue)

Head Office Plant of Shinko Organic Chemical Industry

The Osaka Office currently operates mainly as a laboratory and a distribution center.
Employees working there are mostly R&D personnel and pursue sustainable manufacturing inorder to reduce environmental impact. The Osaka Office started operation in 1961 andbecame a foundation for the subsequent growth of the Company. Although its handlingvolume of hazardous materials has decreased following the reorganization of production
bases, the Osaka Office continues to conduct safety and health activities to protect the safetyof the local community, including regular firefighting drills.

Softball tournament organizedby the Kashiwara City Crime
Prevention Association

The Plant
participated in the
Fair and held an
exhibition booth forcompany
introduction.

Location: 18-8 Katayama-cho, Kashiwara-shi,
Osaka
Established: July 1961
Employees: 47 (as of November 30, 2022)

Shinko Organic Chemical Industry is a chemicals manufacturing plant that has been operating for
52 years in the coastal area of Higashinada-ku, Kobe City, Hyogo Prefecture located at the footof the Rokko Mountain Range. The company supplies various materials, such as acetic esters,organic solvents, and high-purity solvents, to a wide range of fields, such as paints/printing, LCD
panel materials, and semiconductors, by utilizing distillation technology that it has developedsince its foundation. The company also plays a part in the supply chain for certain key supplies
manufactured in Japan. It also works to reduce energy consumption on an ongoing basis
through Kaizen (improvement) activities for a better future for the global environment.
Regional council
cleaning activities
The company
participated in thecleaning activities
organized by theregional council
operated jointly bybusiness sites in theneighborhood andcleaned up the areaaround the plant.

Corporate training for high school students
The company accepted nine sophomores majoring in industrial
chemistry from Yame Technical High School in its corporate training
program during their school trip to the Kansai area. After a tour ofthe chemicals
manufacturing plant, abriefing on shiftwork,etc., they commented
that the training
program was very
useful in considering
their post-graduation
employment.

Shinko Organic Chemical Industry Ltd.
Location: 18-26 Sumiyoshihama-machi,
Higashinada-ku, Kobe-shi, Hyogo
Established: April 1969
Employees: 49 (as of November 30, 2022)
Main products: Solvents for electronics
materials, cosmetics materials,
solvents for coatings/adhesives,
etc.

50

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

Workforce Recruiting and Training

Respecting Human Rights

Recruitment Activities■ Opened More Hotline Reporting Channels■ Laboratory Tour for the Chemical Society of Japan■ Empowering Women in the Workplace
In order to achieve the target of raising the percentage offemale managers (and equivalent) to at least 10% by the endof March 2026, the Company supports the empowerment offemale employees in various ways for the purpose of helping
them play active roles and improve their skills.
In fiscal 2022, we promoted certain contract employees topermanent employees. We also conduct career interviews
with all employees twice a year to review the careerdevelopment of individual employees and provide advice andsupport from their supervisors.

Background of employment
I worked for OOC as a temporary employee for four
years. After two years had passed, I felt that I would liketo work for the Company for many years and strived to
become a permanent employee.
Impression of OOC
On my first day at OOC as a temporary employee, I saw
that top management outreach was conducted. I wasvery impressed by the friendly and warm atmosphere. It
appeared that there was no gap between the Company
and its employees.

JAICO (Japan
Industrial Counselors
Organization)

Future aspiration
As the scope of my work was expanded after becominga permanent employee, I would like to target new goals
with enthusiasm and achieve results.

Changes in the Work Environment
The Group abolished uniforms for female employees working in offices
to change the work environment. In a society oriented toward genderequality, the Company will enhance programs to help employees work
actively regardless of their gender and age.

Initiatives for Diversity■ Childcare Leave for Male Employees

Kanazawa Laboratory

The Company, based on the general action plan under the Act toAdvance Measures to Support Next-Generation Child-Rearing, isworking to raise the percentage of employees who take childcare
leave or leave for childcare purposes. While the percentage of female
employees taking childcare leave remains at 100%, the low
percentage of male employees taking childcare leave has been aproblem. We have been actively promoting awareness of the program
since 2019 and informing employees of childcare leave or leave forchildcare purposes available at the time of birth of each child.

■ Male Employees Taking Childcare Leave■ Lunch Meeting with the CEO
speak to the CEO in their daily work and derived from them
many ideas to improve the Company going forward, such as
their problems at work and programs that they would like theCompany to start.

2

Japan Institute for
Women’s
Empowerment andDiversity Management
Improving the employment
environment and conditions
Promoting diversity
Empowering women in theworkplaceCounseling for harassment
issuesInternal
consultation
service3

General Affairs
Department
Counseling for harassment
issuesCounseling for mental healthissuesCreating a Diverse Workforce /Creating Safe and Pleasant Workplaces

General Affairs Department (Head Office)Ms. MaedaCounseling

Measures for mental health
Career development
Improving the workplaceenvironment

Ms. Higashida

Listening to the Opinions of Employees Directly

Lunch meetings with the CEO have started in this fiscal year
for the CEO to directly listen to the opinions of young
employees of each business site. The CEO had frank talks
with those employees who do not have many opportunities to

4

A uniform (vest, skirt, cardigan, shoes, etc.) had been supplied tofemale office workers since I joined the Company. In recent years,
even banks and department stores are abolishing uniforms. The
Company has also allowed business casual attire at the office inorder to embrace diversity and realize an environment in which all
employees can work actively regardlessof their gender. We realized a smoothtransition through a transition period inwhich either a uniform or businesscasual attire could be worn. Businesscasual clothes are usual in the office
now, with uniforms a thing of the past.

Atmosphere
I think that the Company provides an environment inwhich employees can consult with their seniors
regardless of their age, and employees with little
experience, like me, are supported firmly by theirseniors so that they can solve problems by themselves.

Office forexternal
whistleblowing Employees

Independent legal officewith no vested interest in
OOC Group management■ Abolishment of Office Workers’ Uniform

Promotion of Temporary Employees to Permanent Employees

External
consultation
services

Nakajima Hideji
Legal Office▲

In 2022, we exhibited at 11 schools and were visited by many
students.

1▲■ Participation in On-campus Information Sessions

We held a laboratory tour on the theme of “informing the work of
a company without a household name that is unseen, but isclose to you,” and 10 students majoring in chemistry who belong
to the Society participated in the tour. After a general introductionof the Company and its products, the participants were informed
specifically of the job duties and the atmosphere of the laboratory
in the round-table talk with young researchers. After that, theparticipants took a tour of the CREO Research Center, which
was newly established in 2020, and visited its state-of-the-art
manufacturing site to deepen their understanding of chemicals
manufacturing. We received from the participating students suchcomments as “I learned in detail about the research and physicalproperties evaluation conducted at the Company. In particular, I
was overwhelmed by the laboratory that was so clean” and “I
want to work for such a clean company.”

Support system for creating a pleasant working environment▲ ▲ ▲The OOC Group regularly offers internships to applicants who
are keen to know more about working at a chemical plant. In
fiscal 2022, we continued to conduct online and onsite toursof plants and laboratories while implementing strict
countermeasures against COVID-19 infection. Despite theshort time frame, many students participated.

Data

▲

■ Internships

The OOC Group’s policy on human rights is never tocondone any human rights violation. Under this policy,
the Group operates its business in a manner to respecthuman rights. In order to eradicate various forms ofharassment, the Group had opened three reporting
channels outside the Company and two reporting
channels in the Company. In this fiscal year, the Group
opened another internal reporting channel to encourage
employees to feel free to report any concerns.

S Society▲ ▲In our recruitment activities for fiscal 2022 (March 2023 graduates), we continued to hold company information sessions and screenings
online, considering the health and prevention of infection of students as our top priority due to the COVID-19 pandemic that began in
2020. In addition, plant and laboratory tours were conducted at the Kanazawa Plant and Osaka Office in and after summer 2022. We
plan to continue this program in the next fiscal year as well, while confirming the status of the pandemic.

Percentage of male employees taking childcare leave
Unit: %

100

100
50

18

44

A Male Employee Who Took Childcare Leave
What made you take childcare leave?
I took childcare leave when my third child was born. Based on theprevious experience with the first two children, I knew that if anotherchild were to be born, it would be difficult for me and my wife alone
to take good care of the child. Therefore, I had already made up mymind to take childcare leave in order to support my family as muchas possible.
What did you think during the leave?
Both I and my wife looked after the child, but I did not feel that thechild was perfectly taken care of. I keenly felt that childcare is truly
hard work. It was hard for me to be deprived of sleep, and I was
sometime depressed as I had to stay at home all the time. (To avoid
that situation, I frequently asked the children to come with me to go
for a walk, ha ha.) I also thought that couples should agree on thedivision of roles between husband and wife in advance, because I
quarreled with my wife about that.
I was surprised at the amount of childcare leave benefits that I
received, which was more generous than I expected. (Company
newsletter said that social insurance premiums are exempted, andperhaps for that reason, I felt that the take-home amount was morethan expected.) The child was born before the expected date ofbirth. I had taken leave since a few days before that date. I was very
impressed by the help of the staff at the General Affairs Section. Theyprioritize the needs of employees and helped me to decide whether
to take that leave as special leave or paid leave. When I planned toreturn to work, they also advised me on the date of return by taking
account of the salary implications. As I am not familiar with suchmatters, they were very reassuring and helpful.
Future challenges and other thoughts
More and more male employees are taking childcare leave than
before.
However, I hope that they take childcare leave for a longer period as
it can be taken only by the week, such as one week or two weeks. (Itis, of course, difficult for some people to take a long leave after
adjusting their work responsibilities, but it is a waste not to take leave
for a period of one month, two months, etc., as you can receive
leave benefits in full only if you take leave for such a monthly period.)
It is also difficult to know who is taking leave. As a result, there may
be some people who do not knowwhether they are permitted to takeleave. In fact, when I returned to work,
there were many people who did notknow that I had been on childcare leave.
That said, whether employees feel free
to take leave depends on theirsupervisors. I intended to take leave nomatter what although I felt easy to do so
because my supervisor was supportive.

Mr. Ikeda

Kanazawa Laboratory

0
2020

51

E Environment

G Governance2021

2022 (Fiscal year)

52

Integrated Report 2023

OOC’s Value Creation■ Revision of Paternity Leave Regulations■ Enlightenment Activities (Enlightenment Brochure)

The Child Care and Family Care Leave Act was amended in
October 2022 to introduce paternity leave (parental leave)*. In
response to this development, the Company has revised theapplicable regulations to create an environment in which
employees feel free to take leave.

Promoting
Sustainable Management

The OOC Group, in order to realize its Management Philosophy
and Vision, has established a Purchasing Policy on the
procurement of raw materials in accordance with its Guidelines for
Conduct, promotes raw material procurement activities, andstrives to build and maintain a sound and mutually prosperous
relationship with suppliers.

At the time of childbirth and when an application for childcare
leave is submitted, the Company holds an interview with theemployee to inform the employee how to take leave.

[Purchasing Policy]
In accordance with its Guidelines for Conduct, the OOC Groupputs the following Purchasing Policy into practice in order torealize its Management Philosophy and Vision:

Promoting Health Management

1. Fair and equitable transactions
We provide suppliers with fair and equitable entry opportunities
without being constrained by conventional business practices
and conduct purchasing activities that are open to both
domestic and international suppliers.
We comprehensively evaluate the quality, price, stable supply
capability, technology development capability, management
reliability, etc. of each supplier, and execute best and optimumpurchases.

■ Fiscal 2023 Health Management Survey
This year, we were recognized as one of the “2023 Health & Productivity Management Outstanding Organizations (Large
Enterprise Category)” under the Certified Health & Productivity Management Outstanding Organizations Recognition Program
designed by the Ministry of Economy, Trade and Industry and administered by the Nippon Kenko Kaigi (Japan Health Council).
Health management initiatives contribute to the reform of work styles and the building of an environment to enhance
productivity, which is necessary to create an organization that supports growth, such as improving employee healthliteracy and revitalizing communication.

2. Compliance with laws and regulations
We comply with applicable domestic and overseas laws andregulations, social norms, corporate ethics, and their spirit.

Changes in assessment results
2020

2021

2022

Overall assessment

40.3

50.3（↑10.0）

53.5（↑3.2）

Certification as an excellent health management corporation―

CertifiedCertifiedFiscal year

Focus of activities in this fiscal year
1. Reducing the number of employees with and at riskof metabolic syndrome
Issue: The number of employees with and at risk ofmetabolic syndrome is markedly increasing.
Employees with metabolic syndrome: 16.3% on averageover the last four years
Employees at risk of metabolic syndrome: 17.1% on
average over the last four years
Countermeasures: Encourage applicable employees totake a follow-up examination.
If necessary, internal regulations will be established torequire supervisors to encourage them to take a follow-up
examination.

53

Require or encourage applicable employees to participate
in specific health guidance.
2. Enhancing infection prevention measures
Issue: Prevention of infectious diseases is necessary to
reduce the risk of concurrent epidemic of COVID-19,
seasonal flu, etc.
Countermeasures: Provide financial assistance to cover
the cost of flu vaccination in full.
Eligible persons: Employees and their family dependents
and family members living together, temporary
employees, and prospective employees
Eligible persons are also permitted to receive thevaccination at their workplace.

■ Introduction of Suntory Vending Machines■ Walking Events

As part of health management, the Company has introduced
Suntory Plus vending machines at all business sites(excluding the Tokyo Office). We support health promotionthat is fun and easy to continue by combining a dedicatedapplication, vending
machines, and healthdrinks.
By performing easy healthpromotion tasks every day,employees can control theirbody fat, blood pressure,cholesterol, and blood
sugar.

The Company held monthly walking events for healthmaintenance. In total, 48 employees from all business sites
participated in this event. On average, participants walked
about 6,000 steps per day. We have received from theparticipants such comments as “I have had few occasions towalk lately and have not exercised enough, but walking has
become a habit through the walking event. I would like tocontinue walking going forward.”

E Environment

S SocietyData

Procurement Activities and Managementof Raw Materials
Procurement Activities* The leave can be taken for a period of up to four weeks within eight weeks fromthe childbirth.

G Governancepreservation of assets, and promote sound and transparent
corporate management.
Eliminate any relationship with antisocial forces and do notprovide any benefit to such parties.
2. Compliance with laws and regulations
Comply with domestic and international laws and regulations,social norms, and corporate ethics, in both letter and spirit, in
relation to business activities.
3. Respect for human rights and building a good working
environment
Support the protection of internationally proclaimed humanrights and respect such rights.
Do not engage in inhumane labor practices, such as forcedlabor, child labor, and low-wage labor.
Eliminate discrimination and strive to achieve equal opportunityand fairness in treatment among employees.
Prevent harassment and acts of violence in the workplace.
4. Ensuring safety and healthPrevent occupational accidents and occupational diseases bymaintaining a safe and clean working environment and paying
attention to employees’ health management.
Prepare for possible disasters and accidents and formulate
emergency response measures for the protection of both
employees and the local community.

3. Building partnerships
We strive to build and improve a firm relationship of mutual
trust with suppliers based on the fundamental understandingthat all suppliers are our partners in business execution.
We do not divulge any information obtained in the course ofbusiness unless it is in the public domain.

5. Environmental conservation
Appropriately manage chemical substances as required bylaws and regulations.
Work to reduce environmental impact by conserving resourcesand energy, reducing CO₂ emissions, and reducing waste.
Conduct business activities in consideration of the protectionof the global environment and the preservation of biodiversity.

4. CSR initiatives
We aim for sustainable development together with our
suppliers in order to fulfill our corporate social responsibility andanswer to the social demand for value creation.

6. Improvement of quality and safety
Strive to provide safe products that meet the required quality
standards and provide accurate information about products
and services.

Management
Any delay or disruption in supplies due to an accident or any
other emergency situation at our suppliers (manufacturers of raw
materials and contract manufacturers) may cause disruption in
our own manufacturing activities. For this reason, we strive toensure stable procurement by monitoring the supply risk (such as
production bases of suppliers) of the main raw materials for our
products.

CSR Procurement
Toward the realization of a sustainable society, the OOC Group, inorder to continue to fulfill its social responsibility throughout the
supply chain, has established CSR-Oriented Procurement
Guidelines based on its Purchasing Policy, which is the basic
policy on procurement activities for raw materials. The Guidelines
specifically list matters on which we would like our suppliers towork with us. We will ensure that suppliers understand them andwork with them to promote CSR-oriented procurement
throughout the supply chain.

[CSR Procurement Guidelines]
1. Sound corporate management
Establish a management system to ensure effectiveness andefficiency in operations, reliability of financial reporting,compliance with corporate ethics in both letter and spirit, and

7. Stable supply and flexible response to changes
Strive to meet agreed-upon deadlines and ensure stablesupply.
Establish a business continuity plan (BCP) system to respondto unforeseen circumstances such as natural disasters andaccidents.
8. Information security management
Appropriately manage the confidential information ofcustomers, suppliers, our company, and others, and strive toprevent leaks.
Take defensive measures against threats on computer
networks and manage them so as not to cause damage tobusiness partners.
Appropriately manage and protect the personal information ofcustomers, suppliers, employees, etc.
9. Contribution to local communities
Strive to cooperate with local communities and to contribute to
the development of said communities.
10. Promotion of CSR and its application to the supply chain
Promote CSR activities that contribute to the development oflocal communities and the international community.
Promote the application of these CSR activities to the supply
chain.
Ensure responsible procurement when it comes to social
issues that require compliance with laws and regulations (suchas regulations regarding conflict minerals).

54Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

E Environment

G Governance

S Society

Data

Data

Stakeholder Engagement

Consolidated Balance Sheet[Basic Approach]

AssetsThrough constructive dialogue with our stakeholders, the OOC Group will work together with them to create a sustainable

FY11/21(As of Nov. 30, 2021)

society where the children of the future can live happy lives.

Main methods and opportunities for dialogue

Main dialogue contact

Clients

Daily sales initiatives
R&D/quality meetings: 4 to 5/month
Quality audit: About 1/monthBusiness Operation Division
Quality Assurance Office

Trading partners

Daily procurement initiatives
Supplier audit: About 1/monthTechnical and quality meetings: 1 to 2/month
Safety seminar (for logistics companies)
Kanazawa Plant, Sakata Plant, Osaka Office: 1/year each

Purchasing Department
Engineering Department
Quality Assurance Office
Logistics Department (Transportation)

Shareholders andinvestors

General meeting of shareholders
Briefings for individual investors in Osaka: 1/year
Briefings for institutional investors in Tokyo: 1/year
ONE-on-ONE meetings: 30 to 50/quarter
Business Report/Annual Securities Report

IR & PR Group
Corporate Planning Division

Employees

Employee engagement surveys: 1/year
Interviews with supervisors: 6/year
Interviews with employees who have been with the company
for three years or less: 1/year
Internal newsletter: 2/year (2022)

General Affairs Department
Corporate Planning Division

Participation in community groups and events: 3 to 4/month
Joint research with universities: 3 topics
Dialogue with students: 2/year

Production plants & offices
R&D Division
Business Operation Division andCorporate Planning Division

Local communities

Cash and deposits

9,923,730

8,094,541

Notes and accounts receivable-trade

9,054,341

ー

ー

7,311

419,513357,804

Accounts receivable-tradeー

8,838,444

Contract assets

ー

978,344

Finished goods

4,886,661

4,625,496

Work in process

2,038,298

1,985,897

Raw materials and supplies

1,706,178

2,437,106

Other

74,077

772,651

Allowance for doubtful accounts(14,101)(15,329)

28,088,700

28,082,267

17,568,717

17,378,700

Accumulated depreciation(9,877,562)(10,209,064)

Buildings and structures, net

7,691,154

7,169,635

Machinery, equipment and vehicles

27,921,299

28,621,245(23,570,739)(24,747,678)

4,350,559

3,873,567

2,179,304

2,173,661

807,185

4,785,912

3,161,370

3,290,266(2,579,886)(2,822,212)

581,484

468,053

15,609,688

18,470,830

Goodwill

83,333

63,333

Other

58,26353,358

Total intangible assets

141,596

116,692

5,642,873

5,619,707

Retirement benefit asset

146,509353,157

Deferred tax assets

36,052420

Other202,932

193,660

6,028,369

6,166,945

21,779,654

24,754,468

49,868,355

52,836,735

Notes receivable-trade
Electronically recorded monetary claims-operating

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures

Accumulated depreciation
Machinery, equipment and vehicles, net

Lectures at a University (Hokkaido University)

Land

I have been offering lectures as a visiting associate professor at the Faculty of Advanced Life Science, Hokkaido University since 2018. In
these lectures, I teach the basics of polymer chemistry using the electron theory and prerequisites for innovation. As there are many
students majoring in biology, the former topic is designed to help those students develop an ability to study polymer chemistry from theperspective of organic chemistry. The latter topic is based on my wish that students become bold researchers and is designed to teachthe preciousness of challenges by introducing products and technologies that were born out of failures. At Hokkaido University, lecture
videos are created by lecturers and are made available on a server as online classes to make sure that students can attend the classeven if their network environment is poor. For a lecturer, this method is a little boring. However, at an academic conference held in fall, I
bumped into a student who took my class and I received feedback on the class. (The student said that my lectures were interestingalthough it is possible that the student was just being polite.) I would like to continue to contribute to higher education going forwardfrom the standpoint of a business person.

Construction in progress

Lectures at a University: Trends in Non-financial Information Disclosure by Businesses(Doshisha University)
Lectures were given on the theme of trends in non-financial information
disclosure by businesses. The students were given an introduction to theinformation posted on the website of the Company, as well as to recent
domestic and global developments in the disclosure of non-financial information.
The students were then asked to discuss, in a group discussion format,
non-financial information items that are expected to become important going
forward, and each group made a presentation at the end of the discussion. In
addition, each student is asked to prepare a report on the same theme and to
submit it at a later date.
The reports submitted by the participating students discussed such disclosure
from the perspectives of recruitment, climate change, human capital, etc.,
providing opportunities for students to think about the social value of businesses.

55

FY11/22(As of Nov. 30, 2022)

Current assets

Stakeholder Engagement Initiatives
Stakeholders(Thousands of yen)

Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets

Investments and other assets
Investment securities

Total investments and other assets
Total non-current assets
Total assets

56Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Consolidated Statement of Income(Thousands of yen)

Liabilities(Thousands of yen)

FY11/21(As of Nov. 30, 2021)

FY11/22(As of Nov. 30, 2022)

Current liabilities
Notes and accounts payable-trade

4,192,756

4,522,059

Current portion of bonds payableー

25,000759,920

1,795,832

Accounts payable-other

1,399,135

1,066,907

Income taxes payable

1,615,908

1,036,437

ー

3,225

Provision for bonuses for directors (and other officers)

73,20034,715

Other646,916

685,491

8,687,838

9,169,669

ー

25,000Long-term borrowings

1,494,463

1,736,327

Deferred tax liabilities

458,403410,366ー

10,591

102,591

90,4052,055,458

2,272,690

10,743,296

11,442,359

Current portion of long-term borrowings

Contract liabilities

Total current liabilities
Non-current liabilities
Bonds payable

Provision for share awards for directors (and other officers)
Other
Total non-current liabilities
Total liabilities

Net assets(Thousands of yen)

FY11/21(As of Nov. 30, 2021)

FY11/22(As of Nov. 30, 2022)

Shareholders’ equity

FY11/21(Dec. 1, 2020 – Nov. 30, 2021)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Subsidy income
Surrender value of insurance policies
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission for purchase of treasury shares
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Total extraordinary losses
Profit before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

35,027,956
24,778,402
10,249,553
4,396,575
5,852,97832,236,826
21,947,772
10,289,053
4,354,525
5,934,528

1,663
134,987
70,850115,300ー
85,232
408,033

1,263
198,199
110,759
ー
34,383
107,895
452,500

6,944
ー
492
7,437
6,253,574

5,915
13,9482,017
21,8816,365,146

118,796814,657
933,453

426,995
35,769462,764

ー
9,990
9,990
7,177,037
2,151,359(89,473)
2,061,885
5,115,151
116,261
4,998,890

207
18,49318,701
6,809,209
2,087,265(103,190)
1,984,075
4,825,134
99,232
4,725,901

Share capital

3,600,295

3,600,295

Capital surplus

3,512,539

3,513,544

Retained earnings

30,004,244

33,861,607

Consolidated Statement of Comprehensive Income

Treasury shares(433,016)(2,123,303)(Thousands of yen)

36,684,063

38,852,143

2,101,591

1,913,210

Foreign currency translation adjustment

33,23678,564Remeasurements of defined benefit plans(173,194)(17,619)

Total accumulated other comprehensive income

1,961,634

1,974,155

479,361

568,076

39,125,059

41,394,375

49,868,355

52,836,735

Total shareholders’ equity

FY11/21(Dec. 1, 2020 – Nov. 30, 2021)

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Non-controlling interests
Total net assets
Total liabilities and net assets

57

FY11/22(Dec. 1, 2021 – Nov. 30, 2022)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

FY11/22(Dec. 1, 2021 – Nov. 30, 2022)

5,115,151

4,825,134(63,765)
48,47865,85250,565
5,165,717(184,721)
45,327
158,917
19,523
4,844,658

5,045,191
120,526

4,738,422
106,23558

Integrated Report 2023

OOC’s Value Creation

Consolidated Statement of Changes in Equity

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Consolidated Statement of Cash Flows(Thousands of yen)

FY11/21 (Dec. 1, 2020 – Nov. 30, 2021)(Thousands of yen)

Shareholders’ equity

Balance at beginning of period

Capital surplus

Retained earnings

Treasury shares

3,600,295

3,508,891

26,068,688(435,195)

3,600,295

3,508,891

26,068,688(435,195)

32,742,680
ー
32,742,680(1,193)
3,372(1,063,334)
4,998,890(1,193)
7,020

2,178
(433,016)

3,941,382
36,684,063

Cumulative effect of changes in accounting policies
Restated balance

Total shareholders’equityShare capital

Changes during period(1,063,334)
4,998,890

Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares

3,647

Disposal of treasury shares
Net changes in items other than shareholders’ equity
Total changes during period
Balance at end of periodー3,600,295

3,647
3,512,539

3,935,555
30,004,244

Accumulated other comprehensive income
Valuation difference
on available-for-salesecurities
Balance at beginning of period

Foreign currencytranslation
adjustment

Remeasurementsof defined benefit
plans

Total accumulated
other comprehensive
incomeNon-controllinginterests

Total net assets

2,168,185(15,242)(237,610)

1,915,333

367,259

35,025,273

2,168,185(15,242)(237,610)

1,915,333

367,259

35,025,273

112,102112,102479,361(1,063,334)
4,998,890(1,193)
7,020
158,4034,099,785
39,125,059

Cumulative effect of changes in accounting policies
Restated balance
Changes during period
Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares
Disposal of treasury shares
Net changes in items other than shareholders’ equity
Total changes during period
Balance at end of period(66,594)(66,594)
2,101,591

46,30046,3001,961,634

64,41564,415(173,194)

48,47848,47833,236

FY11/22 (Dec. 1, 2021 – Nov. 30, 2022)(Thousands of yen)

Shareholders’ equity

Balance at beginning of period

Share capital

Capital surplus

Retained earnings

Treasury shares

3,600,295

3,512,539(433,016)

3,600,295

3,512,539

30,004,244
274,088
30,278,333

Cumulative effect of changes in accounting policies
Restated balance

Total shareholders’equity(433,016)

36,684,063
274,088
36,958,151(1,699,127)
8,840(1,142,627)
4,725,901(1,699,127)
9,845(1,690,287)(2,123,303)

1,893,991
38,852,143

Changes during period(1,142,627)
4,725,901

Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares

1,004

Disposal of treasury shares
Net changes in items other than shareholders’ equity
Total changes during period
Balance at end of periodー3,600,295

1,004
3,513,544

3,583,274
33,861,607

Accumulated other comprehensive income

Balance at beginning of period

Valuation difference
on available-for-salesecurities

Foreign currencytranslation
adjustment

Remeasurementsof defined benefit
plans

Total accumulated
other comprehensive
incomeNon-controllinginterests

2,101,591

33,236(173,194)

1,961,634

479,361

2,101,591

33,236(173,194)

1,961,634

479,361

39,125,059
274,088
39,399,147

88,71588,715568,076(1,142,627)
4,725,901(1,699,127)
9,845
101,236
1,995,228
41,394,375

Cumulative effect of changes in accounting policies
Restated balance

Total net assets

Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for directors (and other officers)
Increase (decrease) in provision for share awards for directors (and other officers)
Decrease (increase) in retirement benefit asset
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)
Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets
Loss (gain) on sales of investment securities
Subsidy income
Decrease (increase) in trade receivables
Decrease (increase) in trade receivables and contract assets
Decrease (increase) in inventories
Increase (decrease) in trade payables
Other
SubtotalInterest and dividends received
Interest paid
Subsidies received
Income taxes (paid) refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Proceeds from liquidation of subsidiaries and associates
Purchase of insurance funds
Proceeds from maturity of insurance funds
Payments for acquisition of businesses
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from long-term borrowings
Repayment of long-term borrowings
Proceeds from issuance of bonds
Repayments of lease obligations
Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

FY11/21(Dec. 1, 2020 – Nov. 30, 2021)

FY11/22(Dec. 1, 2021 – Nov. 30, 2022)

7,177,037
2,435,011
16,6661,714(43,000)
9,120
ー
32,214(136,650)
6,944(63,772)(118,796)
9,990(814,657)(115,300)(1,294,947)
ー(1,293,716)
953,270
117,530
6,878,660
136,775(6,707)
115,300(1,286,320)
5,837,707

6,809,209
2,284,165
19,9991,228
ー(38,485)
10,59122,010(199,462)
5,915(109,566)(426,787)
18,493(35,769)ーー
402,169(1,507,738)
293,262(325,831)
7,223,406
156,878(5,401)ー(2,647,736)
4,727,146(630,000)
1,310,000(2,313,825)
164,886(17,037)(708,453)
1,236,027
200,000ー(3,521)
ー(245,520)(35,863)(1,043,306)(330,000)
630,000(5,500,648)
434,250(15,975)(298,709)
61,971
ー
54,116(1,192)
118,208ー(4,538)(4,852,517)

250,000(993,660)ー(14,049)(1,193)(1,063,334)(8,424)(1,830,661)
118,2313,081,969
6,511,760
9,593,730

2,300,000(1,022,224)
50,000(18,904)(1,713,076)(1,142,627)(17,520)(1,564,352)
160,534(1,529,189)
9,593,730
8,064,541

Changes during period
Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares
Disposal of treasury shares
Net changes in items other than shareholders’ equity
Total changes during period
Balance at end of period

59(188,381)(188,381)
1,913,210

45,32745,32778,564

155,574
155,574(17,619)

12,52012,5201,974,15560

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Ten-Year Summary
FY11/13

FY11/14

FY11/15

FY11/16

FY11/17

FY11/18

FY11/19

FY11/20

FY11/21

FY11/22Net sales (millions of yen)

22,55923,79023,707

23,586

26,562

29,25728,63828,68135,02732,236

Operating profit (millions of yen)

1,185

1,358

1,578

2,441

3,208

3,660

3,663

4,442

5,852

5,934

Ordinary profit (millions of yen)

1,366

1,468

1,751

2,596

3,364

3,935

3,833

4,612

6,253

6,365

946

891

1,300

2,044

2,161

2,677

3,035

3,313

4,998

4,725

Total assets (millions of yen)

31,31534,43533,42735,84039,47940,476

43,84845,32449,86852,836

Net assets (millions of yen)

23,24824,14125,851

26,972

29,69830,66232,54635,025

39,12541,394

73.6

69.5

76.7

74.6

74.7

75.1

73.5

76.5

77.5

77.3

Cash flows from operating activities (millions of yen)

2,596

1,038

2,898

3,322

3,537

3,479

3,506

4,799

5,837

4,727

Cash flows from investing activities (millions of yen)(774)

(2,459)(2,430)(2,903)(597)(1,737)(2,739)(4,434)(1,043)(4,852)

Cash flows from financing activities (millions of yen)

(1,154)

140

(738)

642

(987)

(1,738)

432

(648)

(1,830)(1,564)

Cash and cash equivalents at end of period (millions of yen)

3,747

2,450

2,173

3,225

5,180

5,177

6,342

6,511

9,593

8,064

Net income per share (yen)

41.3

38.9

56.81

91.07

96.51

120.67137.05149.59225.65216.87

Net assets per share (yen)1,004.68

1,043.33

1,129.35

1,193.90

1,315.71

1,372.88

1,455.38

1,564.57

1,744.45

1,893.39

Dividend (yen)

10

10

15

25

29

36

40

46

50

54

Payout ratio (%)

24.2

25.7

26.4

27.5

30.0

29.8

29.2

30.8

22.2

24.9

Return on equity (ROE) (%)

4.2

3.8

5.3

7.8

7.7

8.9

9.7

9.9

13.6

11.9

Return on assets (ROA) (%)

4.5

4.5

5.2

7.5

8.9

9.8

9.1

10.3

13.1

12.3

Operating profit to net sales (%)

5.3

5.7

6.7

10.4

12.1

12.5

12.8

15.5

16.7

18.4

Price earnings ratio (PER) (times)

10.7

12.5

11.0

8.8

13.6

11.5

10.2

19.3

16.1

9.7

Debt equity ratio (%)

2.8

4.8

3.7

9.0

7.1

4.8

8.6

9.2

6.1

9.2

Capital investment (millions of yen)

920

2,472

1,130

2,667

1,291

1,741

3,570

4,776

1,646

1,169

1,515

1,409

1,530

1,538

1,495

1,458

1,771

2,085

2,435

2,284

Research and development expenses (millions of yen)

992

982

974

950

943

1,003

1,064

1,210

1,289

1,233

Number of employees at end of period (persons)

410

414

403

395

401

412

425

435

447

454

Fiscal year

Operating results

Profit attributable to owners of parent (millions of yen)

Financial condition

Equity ratio (%)

Cash flow

Per-share information

Other indicators

Depreciation (millions of yen)61

62

Integrated Report 2023

OOC’s Value Creation

Promoting
Sustainable Management

G Governance

E Environment

S Society

Data

Company and Shareholder Information
Company Profile
Company name (trade name)
Osaka Organic Chemical Industry Ltd.
Foundation
December 8, 1941
Incorporated
December 21, 1946
Representative Masayuki Ando, Representative Director and CEO
Share capital
3,600,295 thousand yen
Number of employees
454 (consolidated, as of November 30, 2022)
Listings
Prime Market, Tokyo Stock Exchange(Securities code: 4187)

Status of Shares As of November 30, 2022
Total number of issued shares

22,410,038

Total number of voting rights

215,485

Number of shareholders

8,163

Major Shareholders (10 largest shareholders excluding treasury shares)
Head Office

Tokyo Office

Investment in OOC
Name

Locations
Head Office 1-8-15 Azuchi-machi, Chuo-ku, Osaka
TEL +81-6-6264-5071
Tokyo Office 1-7-2 Nihonbashi Honcho, Chuo-ku, Tokyo
TEL +81-3-6202-7051
Kanazawa Plant 1600-1 Matsumoto-machi, Hakusan-shi, Ishikawa
TEL +81-76-276-6261
Sakata Plant 157-23 Shigerimatsu, Fujisaki, Yuza-machi,
Akumi-gun, Yamagata
TEL +81-234-71-5721
Osaka Office 18-8 Katayama-cho, Kashiwara-shi, Osaka
TEL +81-72-978-6261
Korea Office 99, Digital-ro 9-gil, Geumcheon-gu, Seoul, Korea
TEL +82-10-5081-1757
In order to expand and strengthen its business, OOC opened the Korea Office in
October 2022 as a base for market research and information gathering in the
Republic of Korea.

Group Companies
Shinko Organic Chemical Industry Ltd.
Head Office 18-26 Sumiyoshihama-machi, Higashinada-ku,
Kobe-shi, Hyogo 658-0042
TEL +81-78-811-1931 FAX +81-78-811-7006
Osaka Sales 11F Nomura Real Estate Osaka Building,
Office1-8-15 Azuchi-machi, Chuo-ku, Osaka 541-0052
TEL +81-6-6264-0491 FAX +81-6-6264-8229
Share capital 55 million yen
Number of employees 49
Business description
Manufacture and sales of acetic esters,
among other things[China]Korea OfficeOsaka Organic Chemical(Shanghai) Trading Ltd.

Sakata Plant

Kanazawa Plant
Head OfficeOsaka Office

Tokyo Office

Number of shares held
(in thousands of shares)

Shareholding ratio

The Master Trust Bank of Japan, Ltd. (Trust Account)

2,006

9.31％

Western Red Cedar K.K.

1,110

5.15％

Custody Bank of Japan, Ltd. (Trust Account)

721

3.34％

JSR Corporation

700

3.25％

Yoshitaka Yasukawa

671

3.11％

Osaka Organic Chemical Employees’ Stock Ownership Association

625

2.90％

Mitsubishi Chemical Corporation

587

2.73％

Toagosei Co., Ltd.

521

2.42％

Yuko Tanikawa

427

1.98％

Tokyo Ohka Kogyo Co., Ltd.

426

1.98％

(Note) Shareholding ratio is calculated after deducting 847 thousand treasury shares.
Production plants & offices
Plants

Shinko Organic Chemical Industry Ltd.

Group companies

Shareholder Composition■Financial instruments business operators
36 shareholders
657,635 shares■Individuals
7,843 shareholders
9,486,068 shares

3.0%

42.3%

■Foreign companies
157 shareholders
1,679,392 shares

7.5%

Total
■Financial institutions
17 shareholders
3,792,500 shares

16.9%

8,163 shareholders
22,410,038 shares■General corporations
110 shareholders
6,794,443 shares

30.3%

Osaka Organic Chemical (Shanghai) Trading Ltd.
Office 2801, 2299 Yan An Xi Road, Chang Ning District, Shanghai
TEL +86-21-5212-7410 FAX +86-21-5212-7413
Share capital 210 million yen
Number of employees 6
Business description
International trade and sales of products related toorganic chemicals

6364