4 Symbiosis with the Global Environment

Dialogue with an Expert

Third-Party Opinion

Toward Compilation of theNext Environmental Vision
TDK Environmental Action 2020 set fiscal 2020 as the target year
for achieving carbon neutrality, but the goal was reached aheadof schedule in fiscal 2014. So we have reached the stage where
we should stipulate the next target of our activities. TDK invited
Mr. Keisuke Takegahara, director of the Environmental Initiative& Corporate Social Responsibility Support Department at theDevelopment Bank of Japan, Inc. and a leading figure in the fieldof environmental finance in Japan, for a talk with Mr. Tetsuya Kuwashima and Mr. Ryo Yokoyama of the Safety and Environment
Group of Manufacturing HQ.

Date of implementation: May 8, 2015

Industry-Wide Efforts to Establish International Standards
The first point to be confirmed in the discussion was that in-house
understanding and cooperation are essential to promote the two
objectives of reducing CO 2 emissions and increasing TDK’s environmental contribution. Mr. Kuwashima explained confidently that“our activities are steadily spreading, and we are shifting fromthe stage of calculating reductions and contributions in eachbusiness division to positively calling on sites to put them intopractice.” In order to make employees understand the value ofthese environmental contributions and to feel the significance of
their own efforts, he said, it is important to have an external assessment of TDK’s contributions and to feed that back to sites.
In addition, the participants agreed that in order for TDK toreceive an appropriate assessment, it is essential for the industry to have rational standards that can serve as a foundation.

Mr. Yokoyama resolutely remarked, “If companies in the industry
all have their own standards, even if we shout about consideration
for the environment, there will just be confusion. Standardization
is essential. International standards formulated under the leadership of the Japanese electric and electronic industries have been
issued, and guidance for electronic component manufacturers
compiled on the basis of these standards in collaboration withJEITA [Japan Electronics and Information Technology Industries
Association] has taken shape at last. Now we must publicize thisguidance globally.” Mr. Takegahara highly praised the fact that
TDK is calculating and disclosing its environmental load andenvironmental contribution according to globally acceptable
criteria.

Going beyond Carbon Neutrality to Create Even Higher Value
Mr. Takegahara commented, “TDK’s environmental activities areextremely advanced and unparalleled by other companies. Now
that you have realized carbon neutrality, the next point is how tocreate value not only environmentally but socially as well.” Citing
the example of wearable devices, Mr. Kuwashima spoke of thepotential, saying, “Electronic components account for most of thetotal weight, so if they can be made lighter and smaller, that partcan be allotted to other useful functions, which will increase theKeisuke Takegahara
General Manager,
Environmental Initiative &Corporate Social Responsibility Support Department,
Development Bank of Japan,Inc.

Mr. Takegahara joined the Japan Development Bank (now the Development Bank ofJapan, Inc.) in 1989. He was stationed for a
total of six years in Frankfurt, Germany anddeveloped the DBJ’s environmental rating
loan scheme and is a leading figure in thefield of environmental finance in Japan.

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TDK CSR REPORT 2015

convenience of the final product. In that sense, I think there isroom for quantification of our social contribution.”
As for the future, Mr. Kuwashima said enthusiastically, “Thetarget set in TDK Environmental Action 2020 was so ambitiousthat people in the company asked whether it could really beachieved at first. The next environmental vision must set targets
with the same impact, and we must display the hallmark of TDK
in executing it.”n Mr. Takegahara’s Main Opinions and Proposals
Carbon neutrality is generally discussed
in terms of individual products and individual efforts, but TDK has achieved realcarbon neutrality after building an internationally acceptable framework. This istruly outstanding. To put it another way,
TDK’s positive impact on society in environmental terms grows in proportion tothe spread of its products in society andthe increase in its sales. This is a powerful

message to both investors and society.
In addition, TDK is conducting
M&As. If a company comes under theTDK Group umbrella, that company also
adopts TDK’s standard environmental
countermeasures, which in turn leads toa curbing of the environmental load in theworld. I think TDK should be more awareof this form of contribution and broadcast
it to society.

This year’s TDK CSR Report clearly reflects the efforts by
TDK to evolve its CSR initiatives from a medium- to longterm perspective to the next stage in the process.
As a case in point, take diversity. It can naturally besaid that TDK has stressed the importance of diversity
over the years. With the fact that further clarification ofthis stance is underscored in the company’s newly formulated TDK Value. Also contributing on that front, thisyear’s report is truly outstanding in content. I particularly
encourage readers to closely examine the section entitled“Thinking about Diversity as a Growth Strategy.” It is pointed out that simply bringing together people of all different
genders, nationalities, and other external traits does notamount to real diversity. Since people are all unique, “Ifyou have two or more people, you have diversity.”
An absolute precedent for diversity to contribute togrowth is said to be “a corporate culture in which all employees think and act with a respect for diversity.” Global
HR Department General Manager Andreas Keller correctly states “consolidating and sharing the ‘One TDK’ spirit.”
Proceeding in that context, I also encourage reading of
the “TDK Progress on the Threshold of Its 80th Anniversary” and the statement of the company’s vision in Vision
2035. That information definitely provides a more accurate grasp of the significance in this vein. The effective
sharing of vision is the underlying premise for diversity tofunction correctly. It is likewise imperative that such vision
be coordinated to stay in close step with the changes of
the company. Such initiatives are precisely what TDK has
implemented this year.
Yet another commendable point of this year’s reportare the efforts to incorporate outside opinions from a wide
range of perspectives, effectively addressing diversity,
nonfinancial information disclosure, the supply chain, andother important topics. With regard to the supply chain,progress can be seen in the issuance of improvement
guidance to 13 suppliers and in other forms. With oneof the next steps in the process consisting of capacity

building, as Mr. Masaki Wada points out, I look forward to
the inclusion of such efforts in upcoming reports.
For the environment, I first want to give high marks tothe achievement of carbon neutrality. The report touches
upon the endeavors undertaken at the Kofu Plant (whichhave proven to be extremely important in supporting
the push to arrive at such neutrality) in its introductionof that unit’s activities: “The Kofu Plant consists of many
divisions, so cross-sectional communication among themwas essential.” The essence of this suggestion is not
limited to the environment, but can definitely be applied
to the full scope of CSR. Such cross-sectional dialogue,
which by its very nature expands beyond divisional lines,
is certainly one of the most vital keys in carrying CSR at
TDK to the next stage in its development.
Next, regarding contributions to the world by technology, it was with great interest that I read the article“TDK’s Vision for Future Society”—and especially thecommentary on technology being applied in the medical and healthcare fields. It is described how sensing
technology can support the mobility of people with disabilities, thereby helping to ease the weight of burdens
involved in nursing care. I was pleasantly surprised by thegreat potential impact of such technology on society. In
that regard, it is obvious that demands will continue to beleveled for unrelenting technical development. Looking
ahead, in the event of the need for institutional improvements when such technology is actually deployed in ourdaily lives, I certainly hope that TDK will play an active rolein the ensuing rule-making process. I say that because
the creation of rules are necessary for linking social technical innovation to the social demands for such advances.
To TDK, I look forward to clear recognition of where
the inadequacies in the company’s in-house CSR initiatives lie. That awareness should then be strategicallychanneled into the mission of fulfilling the social responsibilities consigned to TDK on the road to making Vision2035 a working reality.

Toshihiko Fujii
Consulting Fellow,
Research Institute of Economy, Trade and Industry

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