Kaneka Integrated Report 2020

Kaneka Integrated Report 2022

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Tel: +81-6-6226-5050 Fax: +81-6-6226-5037

Sustainable Solutions

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for an Evolving World.

K ane2022
ka I n t
Kaneka Integrated Report

The Dreamology Company—Make your dreams come true—
Trial & Error experiment driven company
KANEKA thinks “Wellness First”.
Kaneka contributes to the sustainability of the earth,develops its business in a “wellness-first” direction,energizes people, adds vibrancy to business, and helps build a happier society.
To make the world more wellness-first.
Kaneka takes an innovative approach to science,and seeks to fulfill people’s dreams by offering a wide variety of solutions.

Top Message
Before We Are No Longer Able to Live on the EarthManagement Philosophy
Management Philosophy Structure “Declaration of Kaneka United”
Management System

Purpose Management and 3 Value Drivers

Value Creation Process

Advancement of Kaneka’s Value Creation Process(Based on Creative Fusion of People and Technology)

Management Strategies
The Path of Hybrid Management - Promoting Portfolio Transformation -A Limitless Adventure

Human Resource Strategies Trust & Respect
R&B Strategies
Manufacturing Strategies
Interview with an External Director

Business Foundation〇L ist of Directors〇 Corporate Governance〇 ESG Promotion〇 Business Risks and Uncertainties〇 Compliance〇 Sustainability - Environment 〇 Safety / Quality〇 Supply Chain Management〇 Communication with Stakeholders

Appendices〇 Consolidated Financial Statements 〇 Financial and Nonfinancial Highlights〇 Corporate Profile 〇 Investor Information 〇 Editorial Policy

Before We Are No Longer
Able to Live on the Earth

Perspectives From Kaneka’s Purpose Management
The caption at the beginning was borrowed from the book,
On The Future: Prospects for Humanity,
by astrophysicist Martin Rees.
This book is about the future.
This book begins here.
It offers some hopes, fears, and speculations about “what lies ahead.”
It states that our ability to sustain a world that is more vulnerable
than ever for much longer depends on our ability to accelerate
one kind of technology while suppressing another.
There are now so many of us and our collective“footsteps” have not only transformed
but have also devastated the entire biosphere in some cases.
The natural environment is being increasingly stressed.
If a critical threshold is crossed,
our activities may cause dangerous climate change and mass extinction.
A dried-up, emaciated world will be passed on to future generations as a result.
Yet, there is no need to put the brakes on technology to reduce this risk.
On the contrary—we must deepen our understanding of natureand deploy the right technologies more quickly.
We have been entrusted as Earth’s stewards in a particularly critical time.
That is the theme of this book.
So it concludes.

Kimikazu Sugawara
Chairman and Representative Director

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Before We Are No Longer Able to Live on the EarthYes.

Kaneka’s policy is to research the “mysteries of life” and to support a society that fosters life.

Martin Rees’ perspectives discussed here are exactly the Purpose Management aims at

This is because the universal understanding in chemistry,“KANEKA The Dreamology Company—Make your dreams come true.”that “life is a chemical reaction,” is the starting point for our activities (such as research).

I have decided on this caption to express my agreement.
The human genome was decoded in 2003.
Kaneka is refining its technology in three domains: the environmental and energy crisis;

What we have found is that, in terms of DNA,

the food crisis, and the wellness (better living) crisis; and we aspire to provide optimal

humans are hardly different from other organisms.

solutions through their social implementation.

While we may look different, in terms of DNA, life is all the same.

We share Martin Rees’ sense of urgency.

The Miracle of the Earth and the Birth of Life
Life Is a Chemical Reaction.

When it was created 4.6 billion years ago, the Earth was a ball of fire.

For several years, I have cast animals, plants,

Over the next 500 million years or so,and other life forms that spring forth vigorously in nature,

this fireball transformed into a planet covered by an ocean,the “joy of life,” as the main characters on the front cover of ourand according to research, minerals dissolved into

integrated reports.

the ocean to give rise to a wide variety of organic matter.
Life was born.

Why?
The reason is clear.

Ultimately, the Earth and all of its life forms,
when the footsteps of their origins are tracked,

At the cellular level, the life force of all life forms,

lead to a single source.

including humans, plants, and animals, can mostly be explainedby a common language called “chemical reactions.”

By the way, humans are said to have undoubtedly sown

This is where Kaneka comes in as a chemical company.

the seeds of most of the problems currently facing theplanet and its human inhabitants.

Let’s open your elementary school science textbooks.
It explains that life consists of sustenance

Therefore, I believe that for humans to survive as a species,—through taking nutrients into the body by eating,

we must change our thought patterns, zoom out,

as well as digestion, absorption, metabolism, assimilation,and reconsider problems from the perspective of “life on Earth,”and catabolism through chemical reactions involving enzymes— and trying to reproduce.

which includes the planet and all of its life forms.

Life, to live, is a chemical reaction.
To live is also to eat.

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Before We Are No Longer Able to Live on the Earth

The New Frontier of Biomanufacturing and Chemistry

Serendipity is being born inside the toy box.

I repeat.

I am proud of our dedicated researchers.

Life and Earth are one, and chemical reactions are its common substance.
Each domain is a new frontier that Kaneka is striving in.

I hope you can see why the integrated reports featured plants
and animals as the main characters.

For example, the KANEKA Biodegradable Polymer Green Planet™,
which will be discussed later in this report,
as well as genome editing technologies, biopharmaceuticals,

The Post-Pandemic Futureregenerative and cellular medicine, organic dairy businesses,

It is said that the global population will reach 9.7 billion by 2050.

supplements, biomanufacturing including fermentation and culture

What can humanity do in the face of global crises such as the environment and energy,

process technologies, PV Technology, E&I,

food, climate change, and world wars?

and medical devices, among others.

This worry is worsening.
Furthermore, dramatic advances have been made in fields such as biotechnology, cyber,

Each research may appear different, but they are all

and AI, and even the possibility of humanity’s exodus from the planet has been discussed.

connected to the big “life,” that is, life on Earth.
As the pandemic comes to an end, the post-COVID
This is the new frontier created by chemistry.

world is at a historical crossroads. In other words,
the period before and after the pandemic is set to decisively alter the course of history.

Hybrid Management of the Toy Box

History never returns to where it was before.

Innovation is a new combination that moves things differently.

The thriving and revival of humanity depend on

To create new combinations between different things in different business fields.

how science and technology can help us resolve

This is what Kaneka calls “Hybrid Management.”social problems.
Saving the planet with chemistry.

The stunning combination of technologies.

Kaneka, as a resident of Earth, will work swiftly to

Our researchers are transcending fields and endeavoring to create

make science and technology dreams a reality andnew combinations never seen before.

to apply them to solve social problems.

This challenge may be a result of Kaneka being like a toy box.
A toy box filled with varied and different things.

Kaneka is a Dreamology Company.

We are enjoying the blessings of diversity.
While we’re on the topic of integrated reports,
I’d like to add a word on why animals breaking eggshells were included.
“You can’t make an omelette without breaking eggs”

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Before We Are No Longer Able to Live on the Earth

That is, it takes a bit of courage to do something new.
If you’re too scared to break an egg, you can’t enjoy a delicious omelette.

■ Kaneka Is a Human Driven Company —The Evolution of “1-on-1”—

The saying shows France’s national character.

People are everything.

Additionally, “Kites rise highest against the wind, not with it.”

The pandemic reminded us how unnatural it is that people cannot talk face to face.

(Winston Churchill)

Our communication has become impaired

We are betting on creative innovation with this feeling.

under the threat of something unidentifiable.
We have become unable to speak up.

■ Restoring Bonds —Trust & Respect—

We have been forced into silence.
While this is improving with the cure of time,
restoring considerate and humane communication

Following the easing of COVID-19 border restrictions in many countries,

remains a large issue in management.

I immediately went to the U.S. and Europe (for the first time in three years).
I was making do with online meetings and messages until then,We have restarted activities to rebuild connections,but once I got in touch with the realities of our customers and colleagues on-site,

such as the first Run, Run, Run. Kaneka (group ekiden competition) in three years.

I discovered that my perceptions were vastly different.
Without realizing it,

By the way, it has been five years since the “Kaneka 1-on-1” system began.

our communication had become fragmented.

Kaneka was the pioneer of the “1-on-1” system in Japan.

The end of the pandemic is the beginning of a

The framework of this system consists of:“new Trust & Respect.”・Increasing corporate value and driving growth through the growth of our people.

Customers and colleagues restoring a true

・To accomplish this, supervisors and subordinates meet ona regular (at least biweekly) basis to review“One Team” by bringing back trust and respect.

the progress of plans and the development of

Mending the divisions.

the subordinate’s career and skills.

My mind is set.
The system is evolving.
Trust People & Mutual Respect is a tradition that

Leadership and followership.

has continued since Kaneka’s founding over 70 years ago.

We will strengthen the mechanism that allows the captain to unite

It is embedded within our company song,

the crew’s feelings to create winning momentum.

“Eichi Aratani (Anew Wisdom)”.

We will reset the soul of the system.

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Before We Are No Longer Able to Live on the Earth■ Diversity: Creating New Value and Women’s Participation■ Positive Thinking: Let’s Remove Limits!

“Wow, I never thought of it that way!”

The other day, I received a courtesy visit“Your perspectives are unique and always moving.”from the players of the Kashima Antlers (we are their official partner).

Diversity of ideas!

The soccer club striving as one team to be the best in Japan andI want to fill Kaneka with such “idea craftsmen.”

the world parallels the way we work as a passionate

I want to amaze the world with their creativity and human magic.

group to achieve a sustainable future.

I work with this in mind.
Our new themes are deepening Trust & Respect between colleagues
Unbound by gender, age, nationality, and other circumstances.

and pushing past limits (Limitless Adventure).

I want you to leap out of the box.

Let’s remove the limits.

I want the hands of different and diverse employees to create new value.
This is what Kaneka considers diversity.

“Innovation is the market introduction of a technical or organizational novelty,
not just its invention.” (Schumpeter)

My job is to bring out their unhindered performance asa stage director.

“The human mind, if left alone, will lean 90% negative.
So put it into words, be aware of it,“It is not the strongest of the species that survives,and act with positive thinking.” (Joseph Murphy)

nor the most intelligent that survives. It is the one thatis most adaptable to change.” (Darwin)“Based on my experiences, I can’t do it, it’s impossible.”
Wave goodbye to these negativity bugs.

I understood him as saying that only companies that

As our experiences have taught us our limits,

can attract a diversity of DNA—a diversity of human

we should also be able to learn to let them go.

resources that cause change—can survive.
“Be different!” is probably the keyword for diversity.
We are actively hiring and promoting women.
We are expanding women’s opportunities because
we want to amaze the world with a diversity of ideas.

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Before We Are No Longer Able to Live on the Earth■ Serendipity: The Ability to Connect the Dots

■ Don’t Forecast the Future, Plan It

While trying many things out of curiosity, something unexpected happens through chanceIt’s not about “how the future will be,” but “what to do with the future.”encounters and seemingly unrelated events.
Discovering new wonders and seizing lucky combinations.

The unknown arouses anxiety and makes you want to know what lies just ahead.

This must be the best part about research.

It’s tempting to try and forecast the future.
But what is more important than forecasting the future, is to plan the future.

The goddess of serendipity arrives in an everyday, ordinary appearance.
This is how I feel after having spent many years on research sites.

That is, to demonstrate adaptability.

The trigger that gives birth to serendipity is the everyday research

Responding quickly and appropriately to changethat connects the dots.

—being reactive; staying ahead of change

Like deer running through the woods,—being proactive; and the best is

research sites are thriving with serendipity.

creating the future with your own hands—being creative.

When Edison said, “I have not failed.
I have successfully found 10,000 ways that will not work,”

Kaneka will act with a clear purpose andhe gave us the trick to encountering serendipity.

principles to plan a future and then realizethat future.

The age of discontinuity.
Without an antenna for things other than what is of
immediate interest, the way we view things becomes
extremely narrow.
If you come across something out of the ordinary,
don’t miss that opportunity; take a detour.
According to research, around 30 to 50% of importantscientific discoveries are said to be a result of unintentional
coincidences.
Like this, the value realized by chance wasn’t somethingthat was initially expected or sought after.
They were completely unexpected.
Let’s keep in mind that research is planning for coincidences.

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Before We Are No Longer Able to Live on the Earth■ Gratitude and Prayers■ What We Considered in Our Mid-Term Plan

I believe management is about responding to change while moving back andI am sometimes moved by nursery rhymes and fairy tales.

forth between the whole and its parts.

The Mother Goose Nursery Rhymes are full of lessons that touch me deeply to this day.

The whole is a part, and a part is the whole.

For want of a nail, the shoe was lost.
Although the brain has long been thought to be the only command center

For want of a shoe, the horse was lost.

for organisms, recent research has led us to believe, for example,

For want of a horse, the rider was lost.

that the brain and gut operate independently, led by gut bacteria.

For want of a rider, the battle was lost.
For want of a battle, the kingdom was lost.

The same is true with management.

And all for the want of a horseshoe nail.

God is in the details.
Each and everything that happens on-site,

A small gap in the mind can lead to a big failure.

and change in each and every employee,

I think it’s a great lesson.

are the factors that harmonize the whole operation.

It also expresses very well, “The whole is a part, and a part is the whole.”
Those who have played with jigsaw puzzles may already know this,Management is truly about the whole picture

but I believe using the parts to paint the whole picture is essential.

—shine a light on the details.
There would be a no greater joy for me than if, while reading this report,(1) Progress Management

you could understand the relationship between

The mid-term plan is an inspection

the whole and its parts in management.

(monitoring) of the runway leading towards

Each and every narrative I present here are Kaneka’s most importanta tremendous leap.

principles and major policies themselves.

Reconfirm the future (aspiration = romance)

Progress Management
Strengthen

intuition andsensibility

See throughStart with an issue「SMART」」

that each business aims for, structure it as a
We have continued to focus on human-driven management this past year.

vision, and specify the dates and scale.

I report this with gratitude and prayers for all of you.

I propose a vision to achieve speed andCreating
the Aspiration
futureCommanddynamism by structuring critical issues,

Managing
Direction

which are choke points (Issue Management),

Where is thedestinationof the shipand by assigning priorities to issues (Direction
Management). The mid-term plan will

Managing
ISSUES

Become acircleManaging
People≠Tool

It’s the people whomove things

Inspire People

meticulously visualize progress management,

Judgment: Good or bad, good or bad?
Decision: Judgment + Jump

which is comprised of these three(Determine/select) ➡ Jump to the other side

managements.

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Before We Are No Longer Able to Live on the Earth(2) From Hope to Plan with SMART(4) Management Is Investment

Identify what should be done now by backcasting from how the future should look.

Beginnings are a revival of mindfulness.

Visualize from the SMART (Specific, Measurable, Actionable, Realistic, Time-Limited)

Review past efforts without preconceptions and deep-clean the mental litter.

perspective and bring the whole picture to the forefront.

Become humbly aware of yourself on the edge of a cliff,

Through this, hope becomes plan.

and don’t repeat the laziness of not having started.
Don’t fall into the pattern of making the wrong decisions.
Focus on the future that has already begun in front of

Scale

you and see into its essence with discernment.

Goal

HOPE

B

PLAN

c

EnvisionFill
the GAPcbb

Project aourhone y skillsginnoquestin yoursharpe n
intuitioSMARTaManagement is investment

3 traits that lead to wrong decisions

Existingbase cargo

A

Now

Small Data (fragments)① Does not face reality① Refine your sensitivity to make correct judgments with small data
⇒Grasp the essence with the right brain② Information is biased

Time

Attitudes that managers value② A Corporation is a Going Concern⇒Corporations cannot stand still because of anticipations.

③ Preconceptions basedon assumptions andprejudices③ Process1. Priority
2. Dynamism→like a tornado
3. Speed(3) 3R+S
Every leader in an organization has the power to decide, together with the responsibility
that goes with it.

(5) Serendipity Is Intuition

Every leader must exercise leadership with determination, using their power correctly

Luck comes to those who are ready.

to lead the organization toward its goals.

Cherish your burning curiosity and inspired heart.

Become aware of this mission, think for yourselves, and ignite people’s hearts

Have the mindset of stepping out of existing boxes and observing from above; and hone yourwith positive action.

ability to notice the sprouts of growth, discover, and imagine.

Passion is born from action, and it spreads.
① Right PracticeState what you want to do specifically

MomentRight brain

Sensitivity

From whole
to partEssence② Right Posture, Standing tallA

Inspiration

Straighten your back, correct your posture
Serendipity③ Right Effort
Give it your all④ Single Minded Way

B

Left brain

Work earnestly
Too Strong

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ReasonLong Time

From partto whole

ity

Curiosuth run

The yotssildernethe w
hroughKaneka Integrated Report 202217

Before We Are No Longer Able to Live on the Earth■ Accelerate the “3+5” Strategic Platform

4. Alliances and M&As

I would like to reiterate the “3 Focal Points and 5 Initiatives” that form the foundation of our strategy.

internal resources, based on the high level of expertise of the Investment PlanningFirst, the three focal points (focuses) are ① Restoring life-nurturing humanity “SX” (sustainability

Committee and the Global Open Innovation Planning Department.

We will strengthen our open innovation and alliance activities that link our external and+ DX); ② Promoting structural reform through M&A; and ③ Promoting diversity throughdiverse people, business areas, regions, and technologies. We will accelerate transformation

5. Diversity Committee

and growth by prioritizing these three points.

We have created opportunities to raise the stage for women’s advancement, such as throughroundtable discussions with female executives.

Three Focal Points
SX

Recovering
our humanity that
nurtures life

We will promote human resource-oriented policies by enhancing the activities of specialized
Five Initiatives

teams that promote the further advancement of women.

1) Strengthening the Asian Strategy

We will also facilitate human capital diversification through initiatives such as career2) Advancing Digital Transformation (DX)recruitment and expanding the appointment of female executives.

3) Advancing Carbon Neutrality

Acceleratetransformationand growth4) Alliances and M&As
5) Diversity Committee

M&A

Diversity

Evolve“manufacturing”

Diverse personnel, Business areas,
Global and local, Technology■ Purpose of the Management Policies“Wellness First” Health Management to Achieve Sustainability (ESG Management)

1. Strengthening the Asian Strategy

1. KANEKA The Dreamology Company – Make your dreams come true –We will accelerate the development of the Chinese market in particular, through local

We will be a company that serves people’s lives through our adventures in the “sea of

business planning and dispatch capabilities, making full use of the Asian regional headquarters

wonders” that is chemistry.

structure. We will incorporate Asian dynamism.
2. Solution Provider
2. Advancing Digital Transformation (DX)We will contribute to building a sustainable society based on the Triple Package ofUnder the DX & Carbon Neutral Committee, we will accelerate efforts that integrate DX andManagement System Transformation.

CN (carbon neutrality) in the manufacturing sector.
We will concretize production technology strategies and production innovation concepts to

3. Hybrid Management

realize CN by upgrading our digital platform, which includes manufacturing innovations that

We will accelerate transformation and growth by combining diverse technologies andapply digital technologies as well as R&B.

promoting hybrid management, which creates valuable solutions.

3. Advancing Carbon Neutrality

4. Trial & Error Experiment Driven Company

The DX & Carbon Neutral Committee will lead our efforts to accelerate the realization of CN

We will strive to be a Value Creating Company, transforming into a new portfolio, by operating

throughout the company with the integration of DX. To achieve a 30% GHG reduction in FY2030

under the guideline of being a passionate experiment company (keeping only what is worth

compared to FY2013, we will strive to both reduce our environmental impact and increase

testing extensively), and through repeated renewals.

business efficiency. We will accomplish this through energy conservation, manufacturing
innovations, alternative fuels, and the introduction of low-CO2 electricity, as well as through theintroduction of our own Internal Carbon Pricing (ICP) system and LCA evaluation mechanism.
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Before We Are No Longer Able to Live on the Earth

Selection and Concentration
1. Domain
We will accelerate portfolio transformation with the three crises (Environment and Energy,
Food, and Wellness) as our business domains.
2. R&B (Research & Business)
We will push ahead with the development of innovative materials (breakthrough technology)
and proactively invest management resources in research and development activities, which
is an investment in the future.
3. The Strategic Investment of Resources
We will make timely investments that contribute to the growth strategy with speed and scale.
We will also make proactive investments that will lead to business expansion, such as instrengthening our capabilities and in facilities to manufacture new products. Furthermore, wewill reinforce our core business groups while accelerating portfolio transformation through therapid growth of leading + large new businesses.

■ Strengthening the Management Platform
1. Speed Up the Implementation of New Businesses Into Society
We will apply a “selection and concentration” approach to themes with scale and improve theproductivity of R&B.
2. Innovate and Upgrade Operations Through Digital Transformation
We will implement business transformation by introducing a new personnel system that will
increase the motivation and productivity of employees, as well as become an organization andpeople that continue to create high value.
3. Evolve “Kaneka 1-on-1”
We will enhance our ability to solve problems on-site by creating a physically strong“One Team” with a strategy (game plan) to win.
4. Open Innovation
We will proactively carry out alliances and M&As, thereby accelerating the transformation of
our business portfolio and accelerating discontinuous growth.

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Management Philosophy
Management Philosophy Structure

Sustainable, Human
Driven Management“Declaration of Kaneka United”

1

Corporate
Philosophy

As good citizens, we look towards the same future
as all stakeholders from the same viewpoint.
Based on the “Declaration of Kaneka United”,
we provide valuable solutions through our mission ofWith people and technology growing together into creative fusion, we will
break fresh ground for the future and tie in to explore New Values. We are also
committed to challenge the environmental issues of our planet and contributeto upgrading the quality of life.

Kaneka thinks “Wellness First”.

Customers

2

Corporate
IdealsToward an Even More Impressive and Productive Future
Hold in your hands the future you have always dreamed of.
We are a highly perceptive and collaborative value-creating group or, as we like to say, a “Dreamology Company.*”
We want to look at the future from the same perspective as our customers. The future that Kaneka visualizes is
one that connects us with our customers.
* “Dreamology” is an expression coined from ‘dream’ and ‘ology’ (science). Our “Dreamology Company” is a “highly perceptive andcollaborative value-creating group.”Five“ties”

1. Tie to the
futureAs a research and development company brimming with creative energy and passion, we will
create future-oriented businesses that leap beyond current market needs and back them up withnew product development, thus protecting the global environment and contributing to the qualityof life.

2. Tie to theworld

We are determined to become a truly global enterprise with diverse human resources working
together on a global scale. Our presence will be felt in markets around the world, including
newly emerging ones.

3. Tie with value

We are proud of our unity and identity as the Kaneka Group and will take on the challenges ofvalue creation and business innovation through close collaboration.

4. Tie forinnovation

We will never cease to pursue innovation, fusing wisdom from both internal and externalsources without getting caught up in organizational compartmentalization and conventional waysof doing things.

5. Tie withpeopleWe in the Kaneka Group believe that the wellspring of corporate growth resides in humanresources and will continue to seek innovation as we cultivate and nurture our valued
employees.

In 2018, Kaneka Group established the ESG Charter, aiming to evolve its ESG management.

3

ESG Charter

Putting the Corporate Philosophy Into Practice
1. We offer solutions characterizedby value to global markets andcontribute to the evolution oflifestyles and the environment
through innovative chemistry.
① We bring innovation to lifestyles and theenvironment by harnessing the unlimited
potential of chemical materials to help
communities achieve sustainability.
(Earthology Chemical Solution)② By adopting a unified approach to food andmedicine that is defined by a focus on
chemistry, we provide innovative solutions
that empower people to live healthier lives.
(Active Human Life Solution)

2. We fulfill our social responsibility by empowering individual
employees to put our corporate philosophy into practicethrough serious, forward-looking effort.

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Our business is rooted in local
communities, promotingsocial contributions andcommunity engagement. We
also contribute to creating awell (sound) community andsociety, ensuring safe operation of plants and disclosureof information.

Shareholders andInvestors

We offer appropriate returns
and disclose timely information
to those who recognize ourcorporate stance and brand value
and who own our shares, so that
we can increase overall trust in
the Group seeking to ensure a
company culture and a society
characterized by wellness.

KanekaGroup

Employees

The Environment

We make efforts to reduce
environmental burden in raw
material procurement, manufacturing and transportation
processes. We also fulfill
social responsibilities bydeveloping cutting-edge
materials and unique technologies to enhance the wellnessof the global environment.

Vendors

We conduct fair transactions
with suppliers and contractors
focusing on compliance andbuild mutually beneficial andwell (sound) relationships oftrust with them, offering equal
opportunities to do business.

Bearing in mind Kaneka Group
employees and their family
members, we offer a workplace environment of wellness — job satisfaction,
appropriate treatment andremuneration, and safe
working environments — andrespect their diversity.

① We actively contribute to our communities by cultivating understanding of
the cultures and customs of the countries and regions where we dobusiness and by pursuing corporate activities that are deeply rooted inthose communities.
② We operate our businesses in a fair and impartial manner based on theprinciples of free competition and legal compliance.
③ We’re committed to communicating with shareholders and other stakeholders and to making information about our operations available in atimely and appropriate manner.
④ We strive to foster an organizational culture that respects the personalities
and uniqueness of all employees so that they can enjoy good health, feel
motivated, and make the most of their abilities.
⑤ Reflecting a commitment to make safety the top priority in our operations,
we work to create safe and healthy workplaces, ensure product safety, andprotect and preserve the environment.

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Society

We provide quality products,
services and value aimed atcreating a sound society,ensure product safety, anddisclose information to those
who purchase our products aswell as potential customers.

Support for the United Nations Global Compact
In March 2015, Kaneka Group became a signatory to the United Nations Global Compact.
The UN Global Compact is a voluntary code of conduct through which the top management of signatorycompanies commit themselves to take action aimed at achieving ten principles in the four areas of
Human Rights, Labour, Environment, and Anti-Corruption. As Kaneka Group with a global network, we
actively share information about our commitment to global sustainable growth as a responsible corporate citizen with our stakeholders and the international community.

Kaneka Integrated Report 2022

23

Management Philosophy

Management System
Trial & Error experiment driven company
We try new things without fear of failure.
We enjoy answers produced from accumulated
experiments.
We continue to be a “Trial & Error experiment
driven company,” creating unique solutions.

Purpose Management and 3 Value Drivers
The backbone of our innovation consists of
two management systems: “Kaneka Tower” and“Triple package as management system transformation”.

Management System

Kaneka Tower

Triple package as management system transformation

Key basic structure of our management model– Its viewpoint and perspective (what is valued) –【Purpose】
Ability to grow tall

[Value②]
Outward strengths

Kaneka as a “Trial & Error experiment
driven company”
ESG management“Wellness First” health management

Further accelerate transformation to a solution provider
based on a new management system

Our
Ambition

3. Ask “Are we playing a useful role?”
Solution provider that provides solutions by structuring customers needs[Value①]
Inner strengths
Management
Innovation

2. Shift from materials to solutions

4. A leader who will face challenges(a person with an edge)
A leader who will influence people
A team that will unite to tackle issues

4. From small to big

5. “Kaneka 1-on-1”
Facilitate personal growth throughemployees’ job performance

Where we are

Large Action

cope

S

The 4 SUs
The 10 SVs

Ambition
Strategy

ActionTechnologicalInnovation &Driving Force

Large Goal
SU Vision

Business
Creation

MarketDevelopment[Value③]
Frontline execution
1. Every value is created on
the frontline
Think by seeing, hearing, andtouching on the frontline to
make decisions
2. Emphasize Value Communication to link the frontlines
togetherer
Driv

Kaneka1-on-1

Goal

Speed &
Scale

What, When, How
to complete

What to do

Management System
Transformation

Mid-Term
Management Plan

5. Open innovation

3. Serve as an interface between
markets and technology

Start small and grow big
Cell division through clustering
Born small, Grow Big!!

Management Hardware

1. Advance transculturation froma global perspective
2. Bring out uniqueness1. Diversity
Broad business domains / Diverse
range of technologies / Global corporate activities / Diverse workforce

FuturePerspective

Design of the Housing

Large Domain[Problem]

Change and
Growth Triangle

ce

man

r
Perfo

s）
p（3S

ar
・Sh
Scale
・
d
e
pe

S

Leadership that lights a fire in people’s hearts

Mid-Term Management Plan

《 Management Software》

Growth strategy fromthe viewpoint of the Change
and Growth Triangle

Implementation of the new
personnel system (Kaneka 1-on-1)
Growth of people and work

Work Culture Innovation
Operational Excellence

Effective use of time, information, and people
Maximization of organizational productivity- Renaissance (Recovering Our Humanity) -Don't Forecast the Future, Plan It
Demonstrate Adaptability
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Management Philosophy

Value Creation Process

Value Creation Process
Advancement of Kaneka’s value creation process (based on creative fusion of people and technology)
Kaneka’s Meaning of Existence
Purpose

Providing solutions through innovative material development across our global network
through the repeated creative fusion of people and our breakthrough technology

Consider with the
B to C & S concept

Globalsystem

M&A

Source-in/
Source-out

Creative fusion of people andtechnology

Combine technologies fromdifferent industries

Environment / Energy

Trial & Error experiment
driven company

Value DriverOpen
innovation

Challenge on
a global scale

Resolution of Social Issues
KANEKA thinks “Wellness First”.

– Active learning to promotedissimilar connection –Brainstorm
various ideas

Feel, perceive,and find
We realize a society where everyone can enjoy nature’s bounty, using
clean and sustainable resources and energy.

Food
Strength of our people
and organization2 1 sites across the worldA pproximately 11,000
employees

Strength in connectingwith nature
Using resources efficiently

Strength in production

Source of CompetitivenessV alue Communication2 1 sites across the world

Solid foundation of people and technology

Strength of collecting,storing, and usingS hareholders’ equity ratioC ash creation capability

Strength of
our technology

Strength in connectingwith societyO nly One and Global No.1
diverse technology baseP
 artnerships for a healthyworldA pproximately 800
research techniciansT rust from customers andcommunities

We realize a society where safe, secure and highly nutritious food isavailable to everyone and where food producers are also satisfied.

Wellness

Human Driven Company
Declaration of Kaneka United
26

Kaneka Integrated Report 2022

We realize a society where everyone has access to leading-edge
medical services and can continue to live a healthy and vibrant life.

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27

Management Strategies

The Path ofHybrid Management

The Path of Hybrid Management- Promoting Portfolio Transformation Our hybrid management approach aims to create unique and valuable new solutions by

32%

14%

Material

Nutrition

2025 + X years

40%
Foundation
Businesses

combining a wide variety of different technologies and solutions, thereby helping to solve
social problems. We will accelerate our selection and concentration of investments and hasten
the transformation of our business portfolio.
We will strategically invest resources (people, goods, and money) to develop unique anddifferentiated technologies that cannot be copied. We will expand the business of our23%
Health Care

Operating income

advanced business groups to achieve significant earnings growth.

100 billion yen

Our foundation businesses will also work to bolster their business foundations by thoroughly
strengthening differentiation capabilities and making capital investments to enhance supply
capabilities, continuously ramping up earnings.

Operating Income Ratio by Solutions Unit (SU)60%
Leading-edge Businesses

30%
Quality of Life

Fiscal 2021

7%
Nutrition

Investing in Leading-edge Businesses

46%
Leading-edge Businesses
54%

Nutrition SU

Material SU● Construct new dairy product plant● Increase biodegradable polymer capacity● Construct new probiotics product plant● Increase MS capacity● Increase PVC capacity

Foundation Businesses

18%
Health Care

● Increase MOD capacity

Operating income

43.6 billion yen

Leading-edge Businesses

60%

Quality of Life
28

Kaneka Integrated Report 2022

51%

Foundation Businesses +Infrastructure

40%

300 billion yen

Health Care SU

Quality of Life SU● Increase biopharmaceutical capacity at● C onstruct additional high-performance

Kaneka Eurogentec S.A.

24%

Fiscal 2022-2024
Investment planpolyimide film and optical film facilities● Increase API capacity● Increase PV heterojunction cell capacity● Construct blood purification system plant● C onstruct additional modacrylic fiber● Construct new catheter plantfacilities

Material

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29

The Path ofHybrid Management

Management Strategies

We bring innovation to lifestyles and the environment by harnessing the unlimited
potential of chemical materials to help communities achieve sustainability.

Earthology Chemical Solution
Material Solutions Unit

Quality of Life Solutions Unit

To support the advancement of life and the environment by drawing out the richness of materials

To produce the leading edge of the enhancement of the quality of life through the power of materials

Material Value Creator

Quality of Life PathfinderSocial issues to be solved

AchievingsustainablemobilitySocial issues to be solved

Improving
convenienceand comfort

Protecting
the Earth’s
Environment

Solutions provided by the Material Solutions Unit[Social infrastructure]
Infrastructure development in response to global
population growth and urbanization[Automotive] Lightweighting and increased fuel efficiency[Aerospace] Lightweighting and increased functionality

Major productlines by
Solutions
Vehicle (SV)

KanevinylTM(Billions of Yen)

Kanevinyl™

(Billions of Yen)
54.0

600
36.4
299.9

413.0

0

45
30
15

2020

■ Segment net sales

30

2021
Operating income (right scale)

Kaneka Integrated Report 2022

Major productlines by
Solutions
Vehicle (SV)Foam & Residential Techs SV

PV & Energy management SV

Processing aids/Specialty
additives

Polypropylene foam made withthe bead method

Roof-integrated photovoltaics

TM

TM

●

2025＋X (Fiscal year) 0

Kane Ace PA

Eperan-PP[Transportation solutions]
Products requiring temperature control,
such as pharmaceuticals

Polystyrene foam made with thebead method

KanepearlTM

VISOLATM, others[New functional textiles]
Textiles that make living spaces
more vivid

Photovoltaic power generation systems
for public and industrial installations

GRANSOLATM

Performance Polymers (MS) SV

E & I Technology SV

Performance Fibers SV

Silyl-terminated polyether

Super heat-resistantpolyimide film

Materials for hair accessory
products

KANEKA MS POLYMERTM,
KANEKA SILYLTM

60

230.5
150

Kane AceTMB,
Kane AceTMM

PVC-PVAc polymers

Segment Net Sales/Operating Income

23.3[Digital devices]Lightweight, compact, wearable,high performance

Impact modifiers

Kaneka XELTM,
KanevinylTM

300[Energy saving]ZEH/ZEB design and construction

Chemicals

Cross-linked PVC

450[Environmental issues]
Solving the marine microplastics
pollution problem

Performance Polymers (MOD) SV

Polyvinyl chloride

Contributing to arich life

Solutions provided by the Quality of Life Solutions Unit

Vinyls and Chlor-Alkali SV

Caustic soda,
sodium hypochlorite,hydrochloric acidContributing to
the development ofsociety throughtemperature control
technology

Contributing
to a smarter
society andsmarter lifestyles

Contributing to
comfortablelivingAcrylic silicon polymer

KANEKA GEMLACTM

Strengthening the glocal supply
system of local production for local
consumption

Developing new products andproviding solutions that meet the needsof each market.
● Shifting to high-value-added areas

Optical acrylic resin

PixeoTM, ApicalTM

KANEKALONTM

Performance fibers eco fur

KANECARONTM

Segment Net Sales/Operating Income(Billions of Yen)

(Billions of Yen)

400

50.5
326.5

300

●

200
100
0

141.0

10.7
2020

■ Segment net sales

60●

Providing a wide range of solutions
using the power of superior materials
and unique services●

Business expansion leveraging
breakthrough technologies

45

169.1

30

16.9

15

2021

2025＋X (Fiscal year) 0

Operating income (right scale)

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The Path ofHybrid Management

Management Strategies

By adopting a unified approach to food and medicine that is defined by a focus on chemistry,
we provide innovative solutions that empower people to live healthier lives.

Active Human Life Solution
Health Care Solutions Unit

Nutrition Solutions Unit

To create a world where advanced medical means are available to as many people as possible

To re-innovate food and health

Medical Edge Explorer

Nutrition Value Chain Innovator
Social issues to be solved

Early applicationand promotionof regenerative
medicine andcell therapy

Contributing to
the fields of
drug discovery
and pharmaceuticals

Social issues to be solved

Advancing
medical care

Contributing to
the reduction ofhealthcare
costs

Solutions provided by the Health Care Solutions Unit
[Regenerative medicine and cell therapy]
Early application and promotion of regenerative medicine and cell therapy
Automated cell culture system, drug discovery support

Major productlines by

[Leading-edge pharmaceuticals]Protein A carriers, biopharmaceuticals,
nucleic acid pharmaceuticals

Medical SV[Leading-edge medical devices]Drug-coated balloon

Solutions provided by the Nutrition Solutions Unit
[Small molecule pharmaceuticals]
Active pharmaceuticalingredients, generics[Dietary supplements and health foods business]
Dietary supplements that help maintain andimprove health

Major productlines by
Solutions
Vehicle (SV)

Pharma & Supplemental Nutrition
SV（(Pharma)）

Solutions
Vehicle (SV)
Medical device

Balloon catheter for
vessel stenosis dilatation

Adsorption Type Blood
Purification Device

Rheocarna

TM

Regenerative medicine and cell therapy Genetic diagnostic

Cell washing concentration products
system(Billions of Yen)
40

●

155.5
150

30

100

11.4

12.7

20

50

52.4

58.9

10

0

2020

2021

2025＋X (Fiscal year) 0

32

Operating income (right scale)

Kaneka Integrated Report 2022●

[Food production support]
New high-performance fertilizer, fish meal
substitute feed

Pharma & Supplemental Nutrition
SV（(Supplemental Nutrition)

Foods & Agris SV

Affinity chromatography resin for
purification of monoclonal antibody
KANEKA KanCapTM series

Dietary ingredients

Dietary supplements

Milk/Milk beverages

YogurtProducts and services
for biopharmaceuticals

Transdermal medicine

AB-Biotics probiotics

Licorice glabra polyphenol

Margarine/Shortening

Whipping cream/Cream forkneading and other uses

Kaneka UbiquinolTM

FloradaptTM series

Watashi no ChikaraTM
Supplement series

Kaneka GlavonoidTM

Segment Net Sales/Operating Income
38.5

200

Segment net sales[High-value-added foods]
Functional oils and fats, antifreeze materials

APIs and intermediates
for small molecule
pharmaceuticals

Segment Net Sales/Operating Income(Billions of Yen)

Solving the
problem of foodshortages

Aiming for
better food

Improving QoL

Accelerating R&B and promoting the useof external resources through activities
such as M&A and open innovation
Delivering unique, cutting-edge medical
solutions to global markets(Billions of Yen)

(Billions of Yen)

300

100

0

152.4

4.9

5.1

2020

Segment net sales

2021

23.5

●

Using digital technology to strengthen
customer contact points and brands

30

15

2025＋X (Fiscal year) 0

LACHENTETM/FRANJETM

Delivering solutions that contributeto production in the fields of fooddiversification, food enrichment, disease
prevention, wellness, agriculture,
livestock, and fishery

45

162.6

NOVATM/EMPERORTM

Watashi no ChikaraTM
Q10 yogurt

●

202.0
200

“Milk for Bread” series

Operating income (right scale)

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33

Management Strategies

The Path ofHybrid Management

Global Strategies - Think Global, Act Local -■ Net Sales Share by Region

Our global network enabling business development
deeply rooted in local communities

In fiscal 2021, we significantly increased sales both domestically and internationally (+16.0% over fiscal 2017).
In particular, overseas sales expanded, and the proportion of overseas sales reached 45%, the highest ever.

We aim to become a company that delivers unique technologies and products all over theworld, in order to save human lives and resolve social issues. To do so, we promote activities
deeply rooted in local communities worldwide. We advance transculturation from a global
perspective. There is no border in chemistry, and when we do business in foreign land, we
focus on conducting local-based business (glocal business) by overcoming cultural differences.
Our goal is to become a company with a global presence by offering valuable solutions to theworld market in a timely manner. Think Global, Act Local.

Net Sales by Region (Consolidated)
0(Billions of yen)

250

750

500

2017

359.7

2018

371.3

115.7

2019

365.0

109.3

110.0

44.7

81.7

48.8

47.3

596.1 billion yen

85.2

79.9

621.0 billion yen

601.5 billion yen

Reinforcement of
production / sales systems
with deep local roots2020

 cceleration of business development
A
based on local perspectives
Market expansion in
emerging countries
Production systems
based on local
characteristics

Research &Business,
open innovationE stablishment of R&B bases
focused on local needs
Creation of new globally competitive businesses
Use of outside technology in addition to Kaneka
technology

 iscontinuous growth driven byD
the fusion of new technologies
Realization of technology and value chain synergies
Collaboration with partners capable of sharing
value on a global scale

Kaneka’s
GlobalStrategies

M&A,
reinforcementof alliancesTraining of personnel
with global skills

2021

346.3

113.1

379.3

42.4

142.0

75.7

577.4 billion yen

62.7

107.6

691.5 billion yen(Fiscal year)■ Japan ■ Asia ■ North America ■ Europe/Other■ Number of Employees by Region
In fiscal 2021, the number of employees
globally increased by 10.8% over 2017.
The numbers of overseas employees in Asia,
in North America, and in Europe all exceeded
the rate of increase in Japan, a figure that is inline with business expansion overseas.

Number of Employees by Region (Consolidated)
Asia
1,657
(+39.7%)T raining of people with enhanced
international skills
Evolution as a multinational company

Fiscal 2021
Total:
11,335(+10.8%)North
America492(+7.4%)
Europe/Other
947(+26.9%)

Japan
8,239
(+5.0%)

We establish a headquarter in each region in order to make speedy business development that makes much closer
connection with the local community.
Each of 4 “Solutions Units” draws up a global strategy for products and services it handles that incorporates both
domestic and overseas subsidiaries, and develop business activities based on such strategy.

*( ) is compared to fiscal 2017

We have approximately 50 overseas subsidiaries, as well as 2 research institutes in 20 countries of overseas. The
consolidated number of employees is approximately 11,000, and among them, 3,000 are working in overseas sites.
34

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Management Strategies

A Limitless Adventure

A Limitless Adventure

Kaneka delivers valuable solutions
for the “Wellness” of the world

To be limitless is to remove the rigid mind of self-restraint that says “I can’t do it.
It’s impossible.”
We are embarking on a limitless adventure.

Human Resource Strategies Trust & Respect
Kaneka is a Human Driven Company

P. 38

Development of Human Resources and Leaders Centered on Kaneka 1-on-1/
Promotion of Diversity - Beyond Attributes - /Promotion of Wellness

R&B Strategies
P. 46

Bringing people and technology together to venture into uncharted domains
R&B at Kaneka, the Dreamology Company
Biomanufacturing/R&B IP Strategy

Manufacturing Strategies
Achieving a sustainable plant that combines digital transformation withP. 54

carbon neutrality
Carbon Neutrality/Digital Transformation (DX)P. 60
[Interview with an External Director]

Kaneka’s Diversity Brings Broader Possibilities
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Management Strategies

Human Resource Strategies
Trust & Respect

Human Resource Strategies
Trust & Respect
Kaneka is a Human Driven Company
Our growth is driven by the willingness of each employee to take on challenges.
We create an environment of openness to challenges—one that provides opportunities,
fosters growth, and enables change.
That guides Kaneka’s human resource strategies as a Human Driven Company.

Development of Human Resources and Leaders Centered on Kaneka 1-on-1
We use Kaneka 1-on-1 to provide high-quality on-the-job training.
Through Hitotsubu-no-Tane Momi Juku, top management is working to develop our
next-generation leaders.

Human Resource Strategy
the Three Pillars

Development of
Human Resourcesand Leaders
Centered on
Kaneka 1-on-1

Promotion of Diversity - Beyond Attributes New ideas emerge from the diverse viewpoints of diverse personalities.
That is the kind of diversity we aim for.

Trust & Respect

Promotion ofDiversity

Promotion of
Wellness

Promotion of Wellness
The physical and mental health of each employee is an indispensable foundation foreach individual to boldly take on challenges.
We are also working to nurture ties between coworkers so that they can cooperate witheach other.

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Management Strategies

Human Resource Strategies
Trust & Respect

Development of Human Resources andLeaders Centered on Kaneka 1-on-1
Kanaka 1-on-1: lighting a fire in people’s hearts
People are everything. A major challenge for management is to improve communication skills
to think of people and be close to them.
We want to light a fire in people’s hearts. With this in mind, we created Kaneka 1-on-1.

The aim of Kaneka 1-on-1■ Development of Leaders Hitotsubu-no-Tane Momi Juku
Hitotsubu-no-Tane Momi Juku, our training program
led by top management, entered its eighth year in
2022.
This program provides job rotations and challenging
assignments, offering participants a chance to gain
new experience and strengthen their leadership andmanagement skills in different environments.
The graduates in this program have been positioned
to management-level executives, such as directors
and department heads.
We are increasing the participation of female executives and promoting the development of female
leaders.
Completion ceremony at the final presentation session

Increase corporate value through the growth of people and drive the growth of the Company.
Team supervisors and subordinates frequently conduct one-to-one dialogues that focus on reviewing
progress against plans and on building skills that will help subordinates develop their careers.
Empowering people and organizations (lighting a fire in their hearts) by building relationships through dialogue.

Expansion of Kaneka 1-on-1(to Kaneka 1-on-1 for all employees)
2021 —
Increased frequency of dialogues
among assistant management
2020 —

Kaneka 1-on-1 for all employees
Regular employees 3,050
Kanaka 1-on-1 team meeting

Number of Participants in Hitotsubu-no-Tane Momi Juku
Fiscal year

2018

2019

2020

2021

2022 (currently
enrolled)

Cumulative
total since startof course

Number of participants

12

12

12

12

12

97

Of which, female

1

0

0

3

3

7

■ Developmental Training
We focus on three areas in ourdevelopmental training:- Leadership development- Kaneka 1-on-1 training- Language training (English andChinese)Results of Company-wide Training in Fiscal 2021
Other
3%

Leadership development
23%

e-learning
16%

2018 —
Executives 850

We are also using e-learning to
expand our training menu toinclude information security,
compliance, harassment, andlabor management.

Total amount:
200 million yen

Kaneka 1-on-1
and career design
training
7%

Cumulative number of dialogues: approximately 50,000/year

Kaneka 1-on-1 is our original system for year-end personnel evaluation. Through it, supervisors and subordinates
engage in frequent dialogue and review organizational goals and personal growth.

Level- andfunction-specific training
34%

Language training(English and Chinese)17%

We will evolve Kaneka 1-on-1 with the aim of enhancing leadership andfollowership.
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Human Resource Strategies
Trust & Respect

Management Strategies

Promotion of Diversity - Beyond Attributes We want to attract a wide variety of human resources DNA, andthrough diversity in ideas create new value to inspire the world.

■ Active Participation of Female Employees
Action Plans for Promotion of Active Participation of Female
Employees (Plan period: April 2021 to March 31, 2026)

We promote the active participationof women, with the aim of increasing
the number of female employees
involved in decision-making.

■ Composition of Executive TeamWe place human development at the core of both our management philosophy and our labor agreement philosophy.
We promote executives on the basis of merit, regardless of academic background or length of service.

Composition of Executive Team (as of April 1 each year)

Target 1

Increase the number of female executives threefold or more.

Target 2

Increase the rate of male employees who take childcare leave for 2
consecutive weeks or longer within a year after their child is born to
30% or more.

Target 3

Work on preparing workplace environment for female employees.

Executive Level
We are accelerating the development and promotion of female executives so that we can achieve our action plans.
The number of female candidates for executive positions, as the first level of assistant managers, is increasing each
year.

(%)

Female Executives and Candidates

100(Persons)■ PhD■ Master’s degree■ University/Four-year college■ Technical college/Junior college■ High school

50

15.9

16.4

17.1

18.1

18.8

150

84
100

2017

2018

2019

2020

2021 (Fiscal year)■ Supporting Senior Employees
We offer career design training for each age group, creating opportunities for employees to think about their careerdevelopment and about their financial plans for post-retirement.
As part of a reemployment system, we have introduced a job matching system that aligns the needs of the individual employee and the Company in five different courses classified by job category. It allows employees to work
vigorously even after retirement.

■ Employing People with Disabilities

0

20

41

29

Our fiscal 2021 employment rate for people with disabilities is 2.53%, up from last year.
We will continue to improve this employment rate by creating a comfortable working environment and expanding
job opportunities.

■ Supporting Employees of Foreign Nationalities
We are also resuming our development of leadership human resources at overseas group companies, having
paused these activities due to the COVID-19 pandemic.
In 2022, we hosted an executive from Kaneka (Malaysia) Sdn. Bhd. in Japan, increasing their experience as
management executives.
Kaneka Integrated Report 2022

60

45

28

33

36

2020
(Result)

2021(Result)

2022(Forecast)

2023(Plan)

2024(Plan)

75

2025 (Fiscal year)(Plan)

Recruitment
In our recruitment in fiscal 2021, women accounted for 30.2% of the technical college and university graduate hires
and 29.4% of mid-career hires.
We will continue to increase our recruitment of women and work to provide an environment where women can play
an active role.

Percentage of Female Among New Recruits(%)

42■ Female the first level of assistant managers■ Female executives

47
50

0

64

● Mid-career hire

38.8

40
32.6

31.9

33.3
31.0

30.4
24.5

29.4
23.5

20

0

2017

2018

2019
(Result)

Recruitment of
new graduates
30.2%(13/43)30.2

2020● Recruitment of new graduates● Mid-career hire

Mid-career hire
29.4%
(15/51)

2021

2022(Forecast)* For fiscal 2022, prospective candidates andmid-career hires are as of December 2022

2023 (Fiscal year)(Plan)

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43

Management Strategies

Human Resource Strategies
Trust & Respect

Promotion of Wellness
To be able to boldly take on challenges, each employee must be healthy in body and mind.
We have defined Vision for Health based on which we are working to improve the wellness of
our employees and our organization.
The Engine of Sustainability Management will lead a company-wide task force to promotewellness and create a healthy organization. This initiative focuses on three perspectives:
prevention of lifestyle-related and other diseases, mental health, and ties between people.
Goals of Our Vision for Health● Organization: A workplace where everyone can work healthy and freely as one team, and each person

can develop and show the full potential of one’s unique character and ability

Wellness centers around the ties between people,
organizations and the Group.
We are working to break down the physical and psychological barriers created by the COVID-19
pandemic and to restore the ties between our employees and the Group.

Participation of Group Employee Runners inthe Hokkaido Marathon
The Hokkaido Marathon, of which Kaneka is a sponsor, was held for the first time in three years.
Approximately 100 runners from the Kaneka Groupran the Sapporo course.

● Coworkers: Employees who spend their healthy and vibrant lives, and work on their jobs

Run, Run, Run. Kaneka 2022
The group ekiden was held for the first time in three
years. Around 2,400 employees and family membersof the Group attended the event.
In keeping with the theme of the event, to breathe
the same air, laugh, cheer, and celebrate, there weresmiles all around and ties between people wereformed.

Measures for Maintaining and Promoting HealthThose in good
healthMental health

Ties

Environmental improvement

Collaboration of personal health activities and those on an organization basis
Rules of Employment

Various health promotion seminars

Welfare measures
Stress care
Consultation service

Those with someabnormality

Human Resources Dept.
/ Personnel at each site / LC

Measures for Maintaining and Promoting HealthPrevention of lifestyle-related
and other diseases

Thorough examination

Labor management support

Specific health guidance

Follow-up by nursing staff

Programs that help
employees improvetheir health while
enjoying being together
Programs that help
employees feel
connected to each other

Working hours
Smart work
Workplace environment
Encouragementof certification

KANEKA Wellness Center Kaze no MoriCreating a New Culture - Bringing Takasago Manufacturing Site Together In July 2022, Kaze no Mori was completed at Takasago Manufacturing Site. It will serve as a base for promoting
the wellness of our employees and the local community.
We have begun an initiative to create a new Takasago Manufacturing Site culture centered on Kaze no Mori.
The main gate has also been updated so that employees leaving Kaze no Mori can feel nature and come to work
feeling refreshed.

Wellness Promotion System
The Engine of Sustainability
Management
Discussion and determinationof Company-wide policies
General Manager: Executive
Vice President

Reporting/Consultation

Global Safety Integrity Center
Global CSV (Quality Environment) Center

Consultation

Improving occupational safety and healthAll organizations
In charge of managing health
Leader of each organization

Approval/
Instructions

Human Resources Department/Work Departments
Occupational health staff
Managing health of people and organization

Monitoring/
Improvement
guidance andsupportEach employee

Photo by Norihito Yamauchi

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Management Strategies

R&B Strategies
Three Crises

Resolution of Social Issues

R&B Strategies

Social Implementation of
New Materials and Systems

Bringing people and technology together to venture into uncharted fields
R&B at Kaneka, the Dreamology Company
To help build sustainability in society, we have defined our business domains in terms of
three crises: “Environment and Energy,” “Food,” and “Wellness.” Our Research & Business isguided by the belief that it is only when research extends to social implementation (business)that it becomes true research.
We have the courage to go outside the box (our own fields), to take in cutting-edge technologies, and to combine these with our own proprietary technologies. That is how we drive Creative Innovation.

Actions to embody the concept of Kaneka as“Trial & Error experiment driven company”
Open Innovation
Self-developed
Technologies with
Introduced Technologies

Promoting innovation
through three “I”s
Identifying promisingtechnologies through three “I”s
● Impactful ● Innovative● Implementable

Drug-coated balloon
technology

A group of individuals who believe in serendipity andset the stage for happenstance with “Scientific Mindset”

From R&D to R&B

Clustering domains

Microbial biopharmaceuticalproduction technology

Born small and grow big

Precision polymerization technology

Bioorganic synthesis technology● Social implementation

Food

Polyimide resin

Heat-resistantcomposite materials

Biodegradable
polymerSuper heat-resistantpolyimide film

Aerospace andaircraft materials

Biodegradable polymer

Energymanagement

OLED Lighting
devices

Next-generation
breeding technology

WellnessResin foaming technology

Roof-integrated
photovoltaics

Organic LED lighting

Genome edited crop

Food production
supportCatheters

Regenerative medicine
and cell therapy

New high-performance
fertilizer

Drug-coated balloon
catheter

iPS cells / Stem cells

Biotechnology

Adsorption separation technology

Macromolecular technology

Key Technologies and
Key Drivers for the Future

Cell separation and culturing technology● Global research network● Solution Provider

Environment /EnergyFunctional film processing technology
OLED device designingtechnology

Powder granulation technology
Resin modification / blending technology

Self-developed
Technologies
Fermentation technology

46

Kaneka Integrated Report 2022

Spinning technology

Metal microfabrication technology

Thermosetting resin
compounding / processing technology

Thin-film formation technology

Kaneka Integrated Report 2022

47

R&B Strategies
Biomanufacturing

Management Strategies■ The Miraculous Polymer Green PlanetTM: A Creative Fusion of People and Technology

Biomanufacturing
Accelerated technological advances in recent years have greatly expanded the potential of
biomanufacturing. This has made it possible to harness the power of living organisms to
produce complex substances that cannot be produced by chemical processes. It has alsoenabled eco-friendly production technologies that use fermentation and culture processes
without the need for high temperatures and pressures.
Kaneka is an advanced biomanufacturing company that started out with technologies foryeast and other fermentation. We have accumulated technologies in various fields such as
pharmaceuticals, agriculture, and environmental fields.
Harnessing the power of livingorganisms(Ancient wisdom)

Evolving into the era of smart
cells technology that designs thefunctions of living organisms

Food: Fermentation (miso, sake, cheese)(Forming new business domains inbiotechnology)

Treatment: Medicinal herbs (Chinese medicine)Agriculture: Hybridization & cuttings

creative fusion of various people and technologies at
Kaneka and of many years of accumulated breeding
and culture technology and process development
technology in the field of polymer materials.

Green PlanetTM is derived from 100% biomass and ishighly biodegradable even in the ocean. We are implementing this miraculous polymer in response to thegrowing needs of society. It is the outcome of a

Progress in Social Implementation
In 2022, with new national laws
and regulations being enforced,
the public awareness of the issueof plastics further grew.
Inquiries have surged from brandholders needing to reduce theiruse of disposable plastics. We areadvancing our development ofprocessing technology to meet thisneed and expanding applications.

Plastic film
(conventional composition)

Biopharmaceutical
Gene therapy
Regenerative medicine
and cell therapy

Water-based ink

Plastic
Ink

Paper

Adhesive

Paper made by Nippon
Paper Industries Co., Ltd.

Plastic
Heat sealing material(Kaneka biodegradable polymer)(First use at a hotel chain) hotel amenity(Tokyu Hotels Co., Ltd.)

Medical &PharmaceuticalPaper(new composition)

Food & Agriculture

Environment

Production process igh performance crops
H(recombinant, genome edited)

Biodegradable polymer

Chemical reaction (hightemperature, high pressure)Plant proteinWastewater treatment

Biofuels↓

Fermentation/culture (normal
temperature, normal pressure)Dietary supplements

Kaneka’s Biomanufacturing Contributes to Three Strategic Areas
Medical & Pharmaceutical

Further Evolution of Green PlanetTM Toward a Decarbonized Society

Food production support
Lactic acid bacteria andorganic dairy products
Dietary supplements

Kaneka’s Biomanufacturing
Fermentation and Culture
Sources of Life
Smart Cells
Green PlanetTM
Biodegradable polymer

develop technologies for breeding high-productivity
microorganisms and for building the world’s first gas
culture demonstration plant for practical use. We will
also continue researching applications for producing awide variety of polymers.

To help tackle the growing social issue of reducing
GHG emissions, we are working to develop technologies that use carbon dioxide as a direct resource.
Research into producing Green Planet™ from carbon
dioxide and hydrogen has already been successful at
the laboratory level. Going forward, we will continue toFood & Agriculture

Biopharmaceuticals
Regenerative medicine
and cell therapy

Heat seal paper for confectionery (Bourbon Corporation)

Photosynthesis
Current

Plant oil
CO2

FutureNew challenges for CO2
utilization
Breeding microorganismsthat efficiently produce
Green PlanetTM from CO2

A culture system thatcirculates while controlling
gas composition

Environment

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R&B Strategies
Biomanufacturing

Management Strategies■ Biomanufacturing to Break Through the Food Crisis

Kaneka Is a Leader in Biomanufacturing
Discovery of biodegradable
polymer (PHBH)

Environment

Decided on large-scale capacity
expansion of Green PlanetTM

Polymer processing
technology

1991

2011

2022

PHBH’s production demonstration
facility begins operations
Developed Glutathione, pharmaceuticalintermediate for hepatic medicines,
using fermentation

Medical &Pharmaceutical

Launched biopharmaceuticals
CDMO business

1974

Started breast reconstruction
treatment using cultured CAL method

2010

2015

Succeeded in mass culture of stem
cells by suspension culture method

Advances are being made in genome-editing technology for improving crops. We aremoving ahead with deploying technologythat will lead to the creation of new business models, focusing on combining two
unique breeding technologies, the iPB
method and the JT method.
In addition, we will combine our proprietary
food production support technologies, suchas anti-stress fertilizers and bio-pesticides,
to expand into large-scale seed-related
businesses.

JT method
High-efficiency genetransfer technology

1946

1977

Started productionof yeast

Started productionof oxidized CoQ10

Kaneka QHTM (ubiquinol)
Watashi no ChikaraTM ENERGY

KANEKA FERTILIZERTM
KANEKA PEPTIDETM

2006

2012

Began sales of Kaneka
QHTM (ubiquinol) in the U.S.

KanekaImmunochromatography
SARS-CoV-2Ag

Genome edited crop

Anti-stressfertilizers

Biofarming

2020

Food production solutions to
help solve the food crisis

Started supplying
COVID-19 test reagents

Soybeans with improved beany smell,disease-resistant wheat, etc.

Started production of oxidized
glutathione GSSG fertilizer

Food & Agriculture

iPB method
Rapid plant breeding
technology■ Biomanufacturing to Diversify Pharmaceutical Modalities

2018

At Kaneka Eurogentec S.A., we have decided toincrease our GMP* manufacturing capacity for mRNA.
Production capacity will be about five times thecurrent level.
Kaneka Eurogentec provides drug discovery companies with plasmid DNA, proteins, and oligonucleic
acids as active pharmaceutical ingredients for biopharmaceuticals.
We have also started manufacturing services formRNA since 2020, and we will continue to expand
our business by enhancing our capabilities.

Developed in planta
genome editing technology* GMP (Good Manufacturing Practice): A system for ensuring that
products are consistently produced and controlled according toquality standards.

PurNaturTM
Organic Yogurt Plain■ The Challenge of Bringing Regenerative Medicine and Cell Therapy to Society

KANEKA YEAST PF

Biopharmaceuticals/
Diagnostics

Affinity chromatography resin for
purification of monoclonal antibody
Kaneka KanCapTM series

Watashi no ChikaraTM
Q10 Yogurt

Product lines (partially) based on biomanufacturing in key strategic areas(environment, medical & pharmaceutical, food & agriculture)50

Kaneka Integrated Report 2022

Cellport Clinic YOKOHAMA, which is operated byGroup company Biomaster, Inc., has established autologous cell therapy technology and accumulated aworld-leading clinical record of more than 1,300 cases.
In addition to the field of plastic surgery focusing on
breast reconstruction, we will expand into the field of
orthopedic surgery for conditions such as knee osteoarthritis.

Kaneka Integrated Report 2022

51

Management Strategies

R&B Strategies

R&B Intellectual Property Strategy■ Actively Using Data

We aim to secure rights to the results of our research and development and to provide solutions at an early stage. We consider intellectual property to be one of the outputs of R&B’s
activities and strive to acquire intellectual property such as results and know-how.
In addition, non-research employees also understand the importance of intellectual property
and use it in their work.

To check for relevant prior art, we have embarked on
an attempt to use AI search tools to optimize our
pre-patent application prior art search while shortening

Number of Domestic
Patents Held

Number of Foreign
Patents Held(No. of patents)(No. of patents)

4,000

3,000

2,000

1,000

0

3,724

4,000

3,515

3,319

3,285

888

867

1,743

1,608

1,582

535

539

558

947

282 8

274 10

2019

2020

3,467

3,473

956

923

1,463

1,520

1,112
3,000

267 11
2021

2,000

1,473

1,000

683

580

587

455 1

467 1

441 2

2019

2020

0

(Fiscal year)
Material SU

Quality of Life SU

In fiscal 2021, we newly registered 258
domestic patents and 280 foreign patents.
At the same time, we strive to manage ourintellectual property expenses efficiently, andactively abandon unused patents.
At the end of fiscal 2021, the number of patents
held was 3,285 domestic patents and 3,473
foreign patents, roughly level with the previous
fiscal year.

2021(Fiscal year)

Health Care SU

Nutrition SU

Other

We evaluate patents in terms of qualitative as well as quantitative aspects. We have introduced LexisNexis’
PatentSightTM, and continue to monitor the Patent Asset IndexTM, a patent value index based on the technical value
and market value of patent families, as one of our indicators. We are forming a network of rights strategically, bothin terms of quality and quantity.
PatentSightTM and Patient Asset IndexTM are registered trademarks of PatentSight GmbH.

Number of Green Planet™ Patent Applications and Value of Patents(No. of patents)
233

80

175
60

155
115

128

137

6
4

40
4
9
20

0

3

3

1
8

2
8
1
2017

2
2016

7
2
10
1
2018

4
10

38

240

180

120

■ Development of applications■ Molding process■ Polymer refining■ Breeding/culture● Patent Asset IndexTM (right scale)45
60

the time frame required for reporting. In addition, weare carrying out trials of AI tools for searches of othercompanies’ patents done by researchers.

IP LandscapeTM Initiatives
We are also making use of IP landscapeTM that combine intellectual property and non-intellectual property
information for analysis. In fiscal 2021, we assigned afull-time staff member in the Intellectual Property
Department to identify the needs of the R&B departments and explore our own IP landscapeTM throughtrial and error.

For example, in searching for applications for newly
developed resins, we structure the results of analyses
so as to combine information such as patent trends
and press releases of other companies in similarmaterials. This provides information to aid decisions
on business strategy.
IP landscapeTM is a registered trademark of Shobayashi
International Patent & Trademark Office.

Accumulating Intellectual Property for Kaneka’s Technological Challenges
We have created a landscape map for a full overview of our accumulation of technology. From the map, we
can see that we have expanded our technology mainly to core polymer technology and biotechnology. At thesame time, we have also ventured into uncharted domains that appear to be technological enclaves, such as
medical instruments and solar cells.
In recent years, we have accumulated
experience in developing technologies thatuse information processing technology
and also in tackling new fields such as
dairy products in the food field.
Going forward, we will continue to take on
the challenge of creating value in new
areas. We will also work on new challenges
by combining existing technologies andexternal technologies.
Landscape map of Kaneka’s proprietary technologies
Overview of our published patents (applications filed from 2002 to2021) by VALUENEX Radar (VALUENEX Japan Inc.)

16
2
2019

Strong Promotion of Intellectual Property and Digital Transformation

1
2020

3
2021 (Fiscal year) 0(The plotline (in red) indicates 2017-2021 applications)

Patent Asset IndexTM: The sum of patent values based on the technical value and market value of patent families

As a fusion of our unique technologies, Green PlanetTM is a key theme that we focus on from the perspective ofintellectual property, and we are actively applying for patents.
A wide variety of applications have been developed from the breeding and culture of bacterial strains andpolymer refining to molding processing technology. This has led to an increase in the number of applications. The
Patent Asset IndexTM has been steadily increasing, showing that the value of patents is improving. Going forward,
we will continue to accelerate our acquisition of rights with a view to delivering results in social implementation.
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Management Strategies

Manufacturing Strategies

Manufacturing Strategies
Achieving a sustainable plant that combines digitaltransformation with carbon neutrality

Manufacturing Means Applying R&B+P
Enhancement of four planning functions and capabilities
P stands for Productions.

The Future of Kaneka Will Be Created from the Practice of Manufacturing in the Field.
Based on a safe and reliable plant that puts safety first, we are realizing production technology and process technology that enable new product production, cost reduction, workload reduction, and high efficiency, and thoroughly
strengthening the global competitiveness of our manufacturing.

Reviving Manufacturing at Kaneka
We will strengthen our R&B+P initiative, which strongly integrates R&B and manufacturing, and we will quickly
implement new technologies in a competitive manner. We have launched the “Manufacturing R&B” & Production
Technology Collaboration Council to accelerate our efforts. To realize the strong manufacturing of an R&D-driven
company, we are enhancing our network planning functions and capabilities to connect our organizations for
manufacturing, sales, and customers and markets. We are also improving the planning function that oversees thesefunctions and manages overall design.

Customers
Marketing ＆Planning(Planning Ⓐ)– Sales and profit
expansion

Digital and Environmental Initiatives
As a reactive company that responds properly to the changing times, we are promoting the use of digital technology
to quickly realize innovations manufacturing and operations. We believe that proactively staying ahead of society’s
rapid shift toward carbon neutrality is vital for businesses to survive. In addition to our own decarbonization, we areworking to realize carbon neutrality for society as a whole.

Business Growth
Plans(Planning Ⓓ)

Marketing ＆Technology(Planning Ⓒ)

Productions

Sales

tion
roduc lity
P
f
o
g
iona
gnin
・Desi ing of Functng・Desi ing of Costs
gn
・Desi

Marketing＆Technical Service(Planning Ⓑ)

Planning Ⓓ (Center) ≧ Ⓐ＋Ⓑ＋Ⓒ
Dynamism in Manufacturing Management(Dynamic Network Organization)

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Management Strategies

Manufacturing Strategies■ Achieving 2030 Targets Toward Carbon Neutrality

Carbon Neutrality

In 2030, we will achieve our goal by lowering energy
consumption through fuel conversion of private power
generator facilities and process innovation, reducing
mainly Scope 1 GHG emissions.

The Kaneka Group aims to reduce Scope 1 and 2 GHG emissions, which include domestic andoverseas Group companies, by 30% by 2030 (compared to fiscal 2013) and to achieve carbon
neutrality by 2050.
We are currently working to identify and implement themes for reducing GHG emissions.
To further accelerate capital investment, we have designed an internal carbon pricing system,
which will be operational from fiscal 2023.
s due tod emission

Increase

Fiscal 2013 GHG emissions* (actual)

Scope 2 will change with the spread of renewableenergy and other factors, but at this stage we are
estimating limited GHG emissions reduction. We willcontinue to monitor changes in the external environment and act accordingly.

rowthbusiness g

Scope 12030 GHG
emissions (target)

950,000 tons

Of which reduction themes identified to date

Scope 1

480,000 tons
Scope 2

Scope 2600,000 tons

600,000 tons

30% reduction 470,000+αtons

Fuel conversion of private power
generator facilities: 310,000 tons
Energy saving: 90,000 tons
Process innovation: 100,000 tons
Use of renewable energy and low CO2
emission coefficient electricity: 40,000 tons
： 540,000 tons

Total

Total 1.55 million tons

2013

2030

2050

Total 1.08 million tons
30% reduction compared to fiscal 2013

* GHG emissions: a value indicating the sum total of energy-origin CO2 emissions, non-energy-origin CO2 emissions,and the CO2 equivalents of methane and N2O emissions, calculated in accordance with the GHG protocol.

Progress to Date - Identifying GHG Emissions Reduction Themes In fiscal 2022, for the GHG emissions reduction of
30% (470,000+αtons) set out in our 2030 target,
we have identified themes for 540,000 tons. We willproceed with technical verification for each theme.
Going forward, we will expand our GHG emissions
reduction themes to domestic and overseas Group
companies.
We will actively incorporate Scope 2 reduction
measures, including at our overseas sites.

1) Fuel Conversion

2) Energy Saving

3) Process Innovation

The fuel for private power generators at Takasago
Manufacturing Site will be converted from coal tonatural gas (LNG) in stages, and the use of coal will be
discontinued by 2030.

As a new energy saving technology, we have started to
examine exhaust heat recovery by heat pumps, which
has a wide range of application for each of our plants.

We are acquiring pilot demonstration facilities to establish innovative technologies at our manufacturing
plants, including vinyl chloride monomers.

4) Use of Renewable Energy and Low CO2 Emission Factor for Electricity

GHG emissions

310,000 tons
Coal-derived

LNG-derived
2013

56

Kaneka Integrated Report 2022

2030

Kaneka (Malaysia) Sdn. Bhd. has started to purchase
low CO2 emission factor for electricity as a way of
reducing Scope 2 emissions.
In addition, we are promoting the use of renewableenergy, through measures such as installing in-house
photovoltaic modules and self-transporting the powerthat we generate.

Photovoltaic power generation equipment installedat the Kaneka Takasago Distribution Center

Kaneka Integrated Report 2022

57

Management Strategies

Manufacturing Strategies

Digital Transformation (DX)

Progress on DX Roadmap

We are accelerating our efforts to integrate DX and carbon neutrality (CN) in the area of
manufacturing as we work to create new value.
We will transform our work culture by promoting production innovation using digitaltechnology and by upgrading our Company-wide digital platform, including R&B.

(1) Data storage infrastructure(3) Use of AI

Deploying a common infrastructure to integrate
production data globally

Operational data
Image data
Textual data

Use of data for optimal
operation of each plant andreduction of production costs

Built an AI infrastructure (Example 1) that all
employees can use; each manufacturing site is
now promoting themes for automation that makes
human judgment unnecessary

Manufacturingwith AI(Examples)
Automation of operations
Automatic detection of productanomalies and defects
Optimization of production
planning, etc.

Smart Work and New Value Creation

Business Portfolio Transformation(2) Developing digital talent

SX = Sustainable + DX

・Since 2018, we have been developing engineers who can use AI (a total of 90 people) and promoting AI themes at eachmanufacturing site
・Providing digital transformation literacy education to all employees

Field Operation Zero

Accelerating DX to Maximize Social and Economic Value
Specific Examples

DX roadmap
2020

Society
Customers

Creating new value
Technology establishment and mass
production through R&B+P
Reform of contacts with markets andcustomers

Field Operation Zero

Digital marketing

Metrics

Net sales of
new products
Portfolio“Manufacturing R&B” & Production
Technology Collaboration Council

GHG emissions
reduction

Using AI to check
operational safety

In-house

Strengthening digitalplatform
Strengthening infrastructure
Developing digital talent

Stabilizing production
process
Data storage
infrastructure, use of AI
Developing digital talent

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Kaneka Integrated Report 2022

Example 2: Automation of transport work

We have introduced a Company-wide AI
infrastructure to reduce development costs andshorten timeframes. We are working on a total ofmore than 100 AI utilization themes at each site.

Automated the transfer of molded products inthe factory, reducing the number of workers to
zero. (Kaneka Hokkaido Styrol Co., Ltd.: Field
Operation Zero initiative at Shibetsu Plant)

Conventional individual
development

Optimizing costs throughproduction and logistics

Shift to monitoring-driven operations

Example 1: Effects of using AI infrastructure

Workload rate
Labor productivity
Cost
Quality, safety,
environment

Initial cost and development period

Zero on-site work in the plant

2030

Linking control
systems
Developing operation
screens

Using in-house AI
infrastructure
Reducing
development
costs bymore thanhalf

Developing work
screens

Developing AI models
Extracting andprocessing data

1-2 yearcommitment period

Linking control
systems

Outsourcing
expenses

Configuration onlywith standard
package features

In-house
manufacturing
costs

6 months - 1 year
commitment period

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59

Management Strategies

Interview withan External Director

Kaneka’s Diversity Brings
Broader Possibilities
Because I see Kaneka as a company that takes on challenges in a range of areas rather thansimply trying to grow a single business as large as possible, I think having more diverse talent totake the lead in various fields will be increasingly important.

New External Director

Yuko Sasakawa
Representative Director and President of
IMAGINENEXT INC.
Outside Director of Gakujo Co., Ltd.

It occurred to me that Green PlanetTM, launched more than 30 years ago, has also come as far as it has
because biotechnology researchers, macromolecular researchers, and people from various other areas ofexpertise came together as a team. That’s amazing, and I look forward to the wealth of innovation we can
expect down the road.

Half a year has passed since you became an external director of Kaneka.
How do you see the Company now?

The Company is also investing in the future, such as deciding to build a new factory for medical devices in
Hokkaido. Every time I see the Board of Directors give approval for different large-scale projects it makes me
excited to anticipate how they will bear fruit in the future.

The first thing that struck me about the Company was that the Corporate Philosophy and Management Philosophy have taken deep root throughout the organization, and are guiding Kaneka to become a company thatworks steadfastly toward resolving social issues. The more I find out about efforts the Company is taking to
make this happen, the more wonderful I think it is.

As a Trial & Error experiment driven company, Kaneka faces a wide range of challenges.
Of course, not only in research, but also in manufacturing, sales, and other roles,
Kaneka employees all share an attitude of taking on challenges.

To initiate a direct dialogue with employees, you also set up a round-table discussion with female
executives.
I was struck by how diverse the participants were. They came from a range of age brackets, and I was surprised to hear that some had joined the Company through mid-career hiring or switched from being contract
employees to their current positions. I’ve worked in the HR industry for a long time, and have heard about theefforts various client companies are making, but I think that such an approach to hiring is still uncommon
among large Japanese companies, especially long-standing companies in the manufacturing sector.

In a broad sense, I think diversity, more than being just about women’s empowerment, involves
the coming together and expansion of various businesses, technologies, and people.
I believe diversity will be the most crucial aspect of corporate management going forward. Management will
be called on more and more to consider how many standpoints and perspectives they take into account andthe height and breadth of these perspectives.
Kaneka is poised to make great strides forward, having positioned becoming embedded in and part of theculture of local communities as the route to becoming a global company. In Japan as well, the Company ispursuing activities that are grounded in Hokkaido and other regional communities. I think this is another facetof diversity that I want to affirm.

60

I attended an internal research conference the other day. It was thrilling to hear from researchers who are
pursuing challenges in a number of directions. I gathered that venues like that are where cross-fertilization
between researchers takes place. It was an opportunity to get a feel for the culture of a Trial & Error experiment driven company that creates innovation through unexpected combinations.

Kaneka Integrated Report 2022

I think the Company has a climate that encourages employees to take on challenges and a robust frameworkfor supporting them in doing that. I would like to see all employees move forward with confidence. Eachupward step opens out onto a different vista. I feel most people waver between the fear of taking a step
forward and the courage to take a leap. But since Kaneka is a Trial & Error experiment driven company, I
encourage employees to view opportunities as another kind of experiment and seize upon them. I think it’sfine to go on trying and sometimes failing. That’s the kind of company Kaneka is.

Interviewers(back left) Shinichiro Kametaka

Executive Vice President, In charge of Human
Resources,
General Manager of The Engine of Sustainability
Management(front left) Sahori Tanaka

Member of Diversity Committee
Head of Public Relations Group
Investor & Public Relations Department(right) Mami Yuki

Secretariat of Diversity Committee
Head of Recruiting Team, Recruiting andPeople Development Group
Human Resources Department

Kaneka Integrated Report 2022

61

Business Foundation
List of Directors

Corporate Governance(June 29, 2022)

For details, see our website.
https://www.kaneka.co.jp/en/esg/governance/corporate/■ Basic Policy
Guided by our Corporate Philosophy, Kaneka aims toachieve sustainable growth, improve medium- tolong-term corporate value, and build trust among all
stakeholders, including shareholders, investors,

customers, local communities, vendors, and employees, realizing optimum corporate governance to fulfill
our social responsibility.

Diagram of Corporate Governance System (June 29, 2022)

Kimikazu Sugawara

Minoru Tanaka

Kazuhiko Fujii

Shinichiro Kametaka

Chairman of the Board

President

Executive Vice President

Executive Vice President(Representative Director)(Representative Director)

Chair of Board of Directors

Mamoru Kadokura

Member of the Board,
Senior Managing
Executive Officer

Member of the Board,
Managing Executive
OfficerMember of the Board,
Managing Executive
OfficerMember of the Board,
Senior Managing Corporate
Executive Officer

ReportIndependent External
Directors’ Meeting
Appointment andRemuneration Advisory
Committee

Appointment

Jun Enoki

ReportAppointment

Appointment

Katsunobu DoroInternal Directors

General Meeting of Shareholders

Board of Directors

Shinobu Ishihara

External Directors

President
Audit

Management
Committee

Board ofAuditors

Cooperation

Cooperation

The Engine of
Sustainability
Management

Internal Audit,

Takeo Inokuchi

Mamoru Mohri

Jun Yokota

Yuko Sasakawa

Independent Member ofthe Board

Independent Member ofthe Board

Independent Member ofthe Board

Independent Member ofthe Board

Audit & Supervisory
Board Member

Senior Managing
Corporate
Executive Officer

Managing
Executive Officer

Executive Officer

Hideyuki Matsui

Akira Iwazawa

Atsushi Kawakatsu

Riichi Nishimura

Etsuo Yoshiike

Isao Otsu

Masami Kishine

Yasuaki Nuri

Yoshiki Takeoka

Masahiro Ueda

Naoki Furukawa

Masanobu Yamada

Hiroshi Fujiwara

Ikuo Aoi

Yasuhiro Sumi

Takuo Ishibashi

Hiroyuki Deguchi

Satoru Katayama

Yasuhiro Uozumi

Masaaki Kimura

Shinji Mizusawa

Yasuyoshi Ueda

Masashi Nishikawa

Katsutoshi Shichijo

Toshio Komori

Kazuo Ochiai

Osamu Ishida

Satoshi Suzuki

Ryuichi Maruyama

Internal Control
Divisions including
Operation Production, R&D, Evaluation
General Administration; andGroup Company

Internal Control
Department

Accounting Audit

Accounting
AuditorHitoshi Yahara
Kan Okabe

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63

Business Foundation
Corporate Governance■ Corporate Governance Structure
Organizational Design
We currently have four independent external directors
and two independent external auditors. Since both theoverseeing of business operations by the Board of
Directors and auditing by the Board of Auditors arefunctioning well, Kaneka has chosen to be a Company
with Board of Auditors under the Companies Act.

Directors and the Board of Directors
The Board of Directors seeks to ensure efficient andeffective corporate governance in order to realize thecompany’s sustainable growth and increase corporate
value in the medium to long term.
The Board of Directors exercises its oversight functions on overall management to ensure fairness andtransparency, as well as to appoint management
positions, evaluate and determine remuneration,
evaluate serious risks and determine strategies tocounter them, and make the best decisions on important business operations. The Board of Directors
makes resolutions on important matters related to the
management of the Kaneka Group after deliberationby the Management Committee, which includes thepresident. There are at most 13 members on the
Board of Directors. Of these, four are independent
external directors, in principle, to strengthen theoversight function. Directors serve for a period of one
year to clearly define management responsibilities.

Auditors and the Board of Auditors
Auditors and the Board of Auditors seek to ensure
healthy and sustainable corporate growth and toestablish a structure with good corporate governancethat can gain social trust by checking on the performance of directors in regard to their duties.
The Board of Auditors comprises four members, twoof whom are independent external auditors in principle, and performs audits in coordination with the
Accounting Auditor and the Internal Control Department. Auditors are given space to periodically exchange views with the president, and monitor thestate of business operations when necessary, byattending key meetings of the Board of Directors andthose of the Management Committee, which decides
on the implementation of important matters, as well
as division head meetings.

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Kaneka Integrated Report 2022

■ Selection Criteria for Directors
Appointment and Remuneration Advisory
Committee / Independent External Directors’Meeting
We have established the Appointment and Remuneration Advisory Committee and Independent External
Directors’ Meeting. The Appointment and Remuneration Advisory Committee discusses remuneration of
Directors, and candidates for Directors and Audit &Supervisory Board Members, and reports them to theBoard of Directors. The Independent External Directors’ Meeting discusses the effectiveness of theBoard of Directors to report to the Chair of the Boardof Directors. In order to increase neutrality, the majority of the Appointment and Remuneration Advisory
Committee are the independent external directors.

Implementation of Business Operations
Kaneka has adopted the executive officer system toharmonize the oversight function of directors with theimplementation function of business operations,which also facilitates decision-making and clearly
defines roles. The Board of Directors decides on key
management strategies and business operations of
the entire Kaneka Group, while executive officers
handle business operations in their respective areasof responsibility. The Executive Officers’ Meeting isheld monthly to share management policies andissues with the aim of achieving management goals
speedily. Division heads, including executive officers
appointed by the Board of Directors, are given extensive authority over daily business execution. Monthly
division head meetings are held to enable the directors and auditors to directly hear progress reports
from each division head. The Internal Control Department evaluates the effectiveness of internal control
and conducts an internal audit.

At Kaneka, directors are selected by the Board of
Directors, on the basis of character, judgment, expertise and experience as well as ethics, after deliberation by the Appointment and Remuneration Advisory
Committee, which is comprised of directors andindependent external directors.
We are expanding diverse businesses globally. In
order for the Board of Directors to make accurate andprompt decisions and supervise these corporate
activities, we place great importance on appointing
directors with different backgrounds such as diverse

knowledge, experience, and expertise. Specifically,
we expect knowledge, experience, and abilities related to business, global, technology, and corporate andgovernance. We also believe that the Board of Directors as a whole has a well-balanced knowledge,
experience, and abilities, and is composed of an
appropriate number of people.
In selecting directors, no restrictions are made interms of gender, age or nationality.
A skill matrix covering each director is disclosed in the
Notice of the Annual General Meeting of Shareholders.

■ Analysis and Evaluation of Effectiveness of the Board of Directors
Kaneka regularly implements an analysis and evaluation of the effectiveness of the Board of Directors,
and discloses a summary of the evaluation results.
Specifically, the Chair of Board of Directors periodically receives reports from the Independent External
Directors’ Meeting and opinions from the internal
directors.
Based on these reports, the current status of operations of the Board is evaluated. In the evaluation
process in fiscal 2021, the Independent External
Directors’ Meeting held discussions focusing on theoperation of the Board of Directors (number of meetings held, frequency, length, contents of information
provided beforehand, contents of agendas, deliberations, etc.), role of external directors, information
provision to external directors, and risk management.
Based on the discussion results, the Board of Directors conducted a self-evaluation. As a result, it has
been confirmed that the Board of Directors functions
effectively in making decisions on important mattersfor the Group such as risk management and supervising business execution. We will continue to enhancethe effectiveness of our Board of Directors througheffectiveness evaluations.

Our Efforts to Strengthen the Governance Capacity
Introduced the executive officer system
2006

Changed the number of directors from 21 to 13
Formulated the Basic Policy on Internal Control
System2011

Appointed an external director

2013F ormulated the Criteria for Independence ofExternal Directors

Increased the number of external directors

2015from 1 to 2
Formulated the Basic Policy on Corporate
GovernanceEstablished the Appointment and Remuneration
Advisory Committee
Established the Independent External Directors’Meeting2016

Commenced the effectiveness evaluation on

2019

Revised part of the Basic Policy on Corporate

the Board of Directors
GovernanceIncreased the number of external directors
2020

from 2 to 4
Revised part of the Basic Policy on Corporate
GovernanceRevised part of the Basic Policy on Corporate
2021

Governance (the Majority of the Appointment
and Remuneration Advisory Committee are theindependent external directors, etc.)2022

Appointment of one female director■ Standards for Independence of External Directors/Audit & Supervisory Board Members
We have defined the Standards for Independence ofExternal Directors/Audit & Supervisory Board Members to guarantee the independence of independent
external directors and auditors in practice.

The standards are disclosed in our notice of convocation of general meeting of shareholders, corporate
governance report, etc.

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65

Business Foundation
ESG Promotion

Business Risks and Uncertainties

For details, see our website.
https://www.kaneka.co.jp/en/esg/promotion/prm/■ Basic Policy■ Basic Policy

In 2018, Kaneka Group established the ESG Charter to
evolve its ESG management. Aiming to provide valuable solutions globally with a focus on chemistry, the

ESG Charter serves as an action agenda for each
employee to materialize our Corporate Philosophy.

■ Promotion System
We reorganized our ESG-related organization with theestablishment of the Engine of Sustainability Management on April 1, 2022. It is tasked with overseeing
and enhancing ESG management. The Engine of
Sustainability Management consists of eight implementation organizational entities. These work topromote ESG and the SDGs overseeing the activitiesof all related departments across the organization. We
will work to protect the environment, to contribute to
the restoration of humanity, and to strengthen“Wellness First” health management to support asociety that nurtures life.

President (Representative Director)
Management Committee

The Engine of Sustainability Management(General Manager: Executive Vice President)
General Affairs (Stakeholders Relations) Department

Secretariat Division

Investor & Public Relations Department
ESG Integrated Report Bureau
Compliance Committee (Secretariat: Legal Department)
Raises awareness of corporate ethics and legal compliance (compliance) and ensures that the entire
Group understands and respects these.
Safety Committee (Secretariat: Global Safety Integrity Center)Chaired by the director in charge of safety and security, this committee sets policies and goals foroccupational safety and security disaster prevention, and checks progress.
DX & Carbon Neutral Committee (Secretariat: Global Production & Engineering Integrity Center)
Accelerates initiatives for digital transformation and carbon neutrality.
Work Culture Committee (Secretariat: General Affairs (Stakeholders Relations) Department)
Promotes reform of work styles to meet the needs of the new era.
Diversity Committee (Secretariat: Human Resources Department)
Promotes company-wide policies from recruitment to training, rotation, promotion, etc., including
promotion of diversity and women’s activities.

Business divisions, staff departments, manufacturing sites, research institutes, Group companies

Kaneka Integrated Report 2022

Kaneka Group has formulated a basic risk management policy to respond to potential risks in business
operations, aiming for the goal of “Wellness First” tomake the world healthy.
Our basic risk management policy is that each division
identifies operational risks and other types of risks
that it may face, takes appropriate preventive measures, and responds appropriately in cooperation withother relevant divisions if a risk manifests itself.
For preventive measures against potential risks includ-ing those related to ethics and legal compliance, theCompliance Committee oversees the development
and implementation of the company-wide plans.
When a risk occurs or is likely to occur, the Compliance Committee handles the risk in cooperation withthe relevant divisions. We regularly check whether theabove-mentioned activities are implemented properly
to prevent our risk management system from falling
into mere formality, and strive to maintain and improve its effectiveness.

■ Business-Related Risks
Factors that may significantly affect the financial
status, performance results, and cash flow status of
the Kaneka Group include those described below.

Diagram of ESG Promotion System (April 1, 2022)

66

For details, see our website.
https://www.kaneka.co.jp/en/esg/governance/risk/

1. Risks related to the novel coronavirus (COVID-19)
pandemic
2. Risks related to the Group’s ability to maintain
operational advantages and trends in the Japaneseand overseas economic environment
3. Risks associated with the globalization of our business
4. Risks of price fluctuations of raw materials andfuel

5. Risks associated with product liability, industrial
accidents and large scale disasters
6. Risks associated with the protection of intellectual
property rights
7. Impact of environment related regulations
8. Risks associated with legal action
9. Risks associated with information security
10. Other risks
Please note that the matters described are only thosethat we considered risks, but that this is not an
exhaustive list of risks borne by the Group. See the
Financial Section for more details.

■ Enhancing Crisis Management Systems
Based on our basic risk management policy, we haveset forth Crisis Management Regulations that define
our basic system and roles for emergency response,
providing emergency examples and clarifying ranks,etc. We will continue to fulfill our social responsibility
by maintaining corporate activities while avoiding andreducing adverse effects on the Kaneka Group as
much as possible. In preparation for an emergency,

we regularly conduct a disaster drill and a safety
confirmation system drill. We also provide employeeswith the Crisis Management Handbook about theinitial response. This handbook explains emergency
procedures: proper incident notification, instructions,consultation, and response, as well as the smooth
flow of information.

■ Strengthening of Information Security
Information systems play a key role in all aspects ofbusiness activities.
Based on our Basic Information Management Policy,
we have put in place a risk management system at
the Kaneka Group that is led by management. We
appropriately manage information to avoid information
leakage and other risks, and we promote effective
use of information and efficiency in operations.
To protect our information assets from risks, we

review existing facilities and deploy new security
systems and tools, and strive to enhance security
levels by using the knowledge of external experts. In
addition, we disseminate our Basic Information Management Policy to employees. We use the Information Security Guidebook along with hold training
programs, audits, drills, and online courses to promotecorrect information management.

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Business Foundation
Compliance

For details, see our website.
https://www.kaneka.co.jp/en/esg/governance/compliance/■ Basic Policy
Viewing compliance as an important management
issue, we implement various initiatives to ensurecompliance among all directors and employees not
only with all applicable laws and regulations, but alsowith business and social ethics. We aim to improve

our compliance activities by thoroughly implementing
the ESG Charter and the Code of Ethical Conduct,
which serve as the guidelines for each individual’s
behavior, enabling us to build relationships of trustwith our stakeholders.

standing and observance throughout the Kaneka
Group.

■ Reinforcing Legal Compliance and In-house Training

In keeping with our corporate philosophy, we at the
Kaneka Group will contribute to realizing sustainable
development and the enrichment of society byconduct various training programs to strengthen legal
compliance and raise awareness.

Diagram of Promotion System (April 1, 2022)
President (Representative Director)
Organs responsible for deciding policy and measuresand for auditing activities

To prevent compliance violations and ensure early
detection and prevention, we have established internal reporting and consultation services within the
Company and at outside law firms.
In fiscal 2021, there were five cases of reporting andconsultation concerning violation of internal rules,
harassment, work content and work environment.
Fact-finding investigations and hearings were con-Management Committee, Plant Management
Committee

Carbon Neutral Policy Formulation
The Engine of Sustainability Management
DX & Carbon Neutral Committee(Secretariat: Global Production &Engineering Integrity Center)

ducted, and the cases were handled in accordancewith internal rules. The details of the cases are reported regularly to the Compliance Committee. In addition, we have established rules on whistleblowing andemployee employment regulations to ensure thatwhistleblowers and consultants are not subject to any
discrimination.

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Kaneka Integrated Report 2022

Production DX & Carbon Neutral
Project Conference

1. Protect the natural ecosystem and reduce
environmental impact

Throughout our business activities, we strive to raiseawareness of respect for individuality and humanrights.
To maintain a workplace environment where all employees feel healthy and fulfilled in their work andwhere there is no harassment, we will deepen awareness and understanding among employees and makethe workplace environment a more comfortable place
for them to work.

When dealing with important matters relating to
global environment protection, the Corporate Manufacturing Integrity Center, which is under direct presidential control, and the Global CSV (Quality Environment) Center take the lead role in sharing the issues
with the Management Committee, the Plant Management Committee, and other relevant bodies and thenformulating policies and measures.
With specific focus on carbon neutrality, we haveestablished a DX & Carbon Neutral Committee under
the control of the Engine of Sustainability Management to accelerate initiatives.
To also promote further enhanced ESG management
as part of the Mid-Term Management Plan, we arestrengthening initiatives on important matters.
In our business activities, we are taking steps toreduce environmental impact and ensure appropriate
chemical substance management and information
disclosure, with the Global CSV (Quality Environment)
Center playing the central role in environment conservation activities.

Business divisions, staff departments, manufacturing sites, research
institutes, Group companies

Basic Policies for Responsible Care

■ Respect for Human Rights
Human rights are the rights that anyone can feel, theright to live like a human being, which each and every
one of us is born with. Since its foundation, Kaneka
has practiced respect for humanity in its management. We have a fine tradition of maintaining a culture
and climate that tries to make the most of the goodqualities of each individual. We see respect for humanrights as a fundamental principle that should be upheld by the Company and each of its employees.

Global Production & Engineering Integrity Center
Global CSV (Quality Environment) Center■ Internal Reporting and Establishment of Consultation Hotlines

conserving resources and reducing environmental
impacts at each stage of the entire product lifecycle.

■ Promotion System and Policy

Corporate Manufacturing Integrity Center

The Kaneka Group carries out business activities
globally and as various rules are strengthened aroundthe world, it faces a need for even greater legal compliance.
The “Ethical Code of Conduct” and “Compliance
Guidebook” that all of our directors and employees
should follow are posted on the company’s intranet.
We strive to conduct our business activities in a fair,appropriate, and transparent manner.
In fiscal 2021, there were no serious violations oflaws, regulations, or rules. Improving compliance isessential for our business activities since earning thetrust of our stakeholders is vital. We will continue to

For details, see our website.
https://www.kaneka.co.jp/en/esg/environment/env/■ Basic Policy■ Promotion System
Established under the Engine of Sustainability Management, the Compliance Committee disseminatescorporate ethics and compliance to ensure under-

Sustainability — Environment —2. Offer safe products and information
3. Develop products and technologies in considerationof the environment and safety
4. Reduce waste and promote the recycling of plastics
5. Enhance process safety, disaster-prevention, andoccupational safety and health

Meanwhile, toward realizing a sustainable society, we
have set out the Basic Policies for Responsible Careunder which we ensure strict observance of laws
protecting human health and safety and rigorouscompliance with environmental legislation such as the
Air Pollution Control Act and the Water Pollution
Control Act and the criteria set out in related agreements. Internal auditing, ESG safety and quality inspections, and other tools are used to confirm compliance and to manage environmental impact and risk
reduction.

6. Win public confidence

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69

Business Foundation
Sustainability — Environment —■ Environmental Performance■ Climate Change Initiatives

Kaneka Group is working to reduce environmental
impacts by aggregating the status of energy andresource inputs and material outputs through emis-

sions and products to grasp production activity volume, targeting Kaneka and Group companies within
and outside Japan.

Material Balance in Production Activities (Fiscal 2021)

Kaneka and Group companies in Japan 47 Group companies outside Japan 16

INPUTS (Energy and resource inputs)

1,474 thousand
279 tons

Main rawmaterials

Energy(Crude oil equivalents)

558 thousand
162 kiloliters

Target27.6
million m3
10.1

Water

Manufacturing sites
Research institutes
Facilities

Major OUTPUTS (Material outputs by product and waste category)
Product output
Products

Atmospheric emissions

1,821.0 thousand
351.0 tons

Waste
Final landfill

350.2
tons
5,109.7

Emissions into water systems

GHG

1,220.0 thousand
328.0 tons-CO2e

Chemical oxygen
demand

236.2
tons
107.7

SOx

85.5
tons
0.8

Suspended
solids

207.9
tons
26.0

NOx

876.3
tons
62.1

Energy intensity index*1

Average annual reduction of 1% or more

90.4 (all parent manufacturing sites)
2.1% year-on-year reduction

CO2 emission intensity index*2

Average annual reduction of 1% or more
(fixed emissions factor)
Estimated fiscal 2021 performance 92.3
(fiscal 2030 target 84.3)

85.8 (all parent manufacturing sites)(10 thousand tons-CO2e)
250

100.0

91.5

91.4

154.5
23.1
15.5

161.1

161.4

32.0

34.2

16.9

16.8

200

■ Eco-Friendly Products

85.8* Products that can contribute to reducing global environmental impact at thestages of customer use, disposal and recycling, compared to conventional
products.

Energy Creation

80
148.4
29.4

145.5
28.4

15.8

14.9

154.8
32.8

Intended use

Intended use

Reason for environmental contribution
Creating energy with houses equipped with this productReason for environmental contribution
Storing energy by houses equipped with this productPhotovoltaic power generation systems

Residential electricity storage systems
Residential stationary batteries

Energy Saving

Energy Saving

Product nameProduct name

Intended use

Intended use

KanepearlTM

EperanTM

Residential/automotive foams
Reason for environmental contribution
Saving energy as insulation and lightweight residential/
automotive materials

Waste Reduction

Automotive parts, Package cushioning materials
Reason for environmental contribution
Saving energy as lightweight automotive parts

Chemical Pollution Prevention

Product nameProduct name

Intended use

Intended use

Reason for environmental contribution
A naturally derived and biodegradable resin that has little
environmental impact when discarded

Reason for environmental contribution
A naturally derived and biodegradable material friendly tothe environment

Green PlanetTM
Biodegradable Biopolymer (straws, cutlery)

60

14.8

2013
(Base year)

112.2

110.5

103.2

102.2

107.2

2017

2018

2019

2020

2021 (Fiscal year)20*1 Energy intensity index: a value for energy intensity indexed against a valueof 100 for fiscal 2013. The value is calculated by dividing manufacturing
energy consumption by activity volume (all parent manufacturing site
production volume).
*2 CO2 emission intensity index: a value for energy-origin CO2 emission
intensity indexed against a value of 100 for fiscal 2013. The value iscalculated by dividing energy-origin CO2 emissions by activity volume.
*3 GHG emissions volume: a value indicating the sum total of energy-origin
CO2 emissions, non-energy-origin CO2 emissions, and the CO2 equivalentsof methane and N2O emissions, calculated in accordance with the GHG
protocol.
*4 Non-energy CO2 emissions and CO2-equivalent of methane and N2Oemissions are included.

GHG emissions: Kaneka
Group companies in Japan
Group companies outside Japan
CO2 emission intensity index for all parent manufacturing sites (right scale)*5 Calculated based on market standards. Scope 2 emissions calculated using
the location-based method amounted to 407.2 thousand tons CO2e.

Scope 1 and 2 Emissions (Kaneka)

Scope 3 Emissions (Kaneka)(Thousand tons-CO2e)(Thousand tons-CO2e)

Energy Storage
Product name

VISOLATM ／SoltileXTM ／GRANSOLATM

0

100

40
115.9

Product name

Kaneka Integrated Report 2022

91.6

95.7

100
50

70

Fiscal 2021 performance

GHG Emissions*3 and Energy Origin CO2Emission Intensity Index

150

Focusing on eco-friendly management, Kaneka Grouphas defined, enhanced, and expanded its eco-friendly
products* since fiscal 2017.

including our own environmental capital investment
program. In fiscal 2021, we met our index targets forboth energy intensity and CO2 emissions intensity.

To address global warming, we at the Kaneka Groupare working to promote energy conservation andreduce CO2 emissions through a range of measures,

KANEKA SurfactinTM
Biosurfactant, Cosmetic, Cleaning agents

1,600
1,200

4,000
1,121.8

1,104.7

293.5

317.7

828.2

787.0

2017

2018

1,032.1

1,022.4

1,071.8

246.4

262.5

335.6

785.7

759.9

736.1

2019

2020

2021 (Fiscal year)

800
400
0

3,000
2,000

Scope 1 direct emissions*4

Scope 2 indirect emissions from energy consumption*5

1,000
0

2,131.7

2,085.6

2017

2018

3,142.9

2,905.0

2019

2020

3,344.62021 (Fiscal year)

Scope 3 other indirect emissions (upstream/downstream)*4

Note: The reason for the large increase in Scope 3 emissions from fiscal 2018 to
fiscal 2019 was the addition of a category to the scope of calculation.

We are implementing life cycle assessment (LCA) for
our main products and intend to successively expand
the range of products covered going forward. We arealso working to introduce carbon-life cycle analysis(cLCA), which calculates the contribution to GHG

emissions reduction relative to comparable products,
and indirect GHG emissions calculation, which covers
business activities throughout the supply chain (Scope
3 emissions).

Kaneka Integrated Report 2022

71

Business Foundation
Sustainability — Environment —■ Information Disclosure in Line with TCFD
With people and technology growing together intocreative fusion, we will break fresh ground for the
future and tie in to explore New Values. We are also
committed to challenge the environmental issues ofour planet and contribute to upgrading the quality oflife. Guided by this corporate philosophy, the Kaneka
Group will leverage its products and services to■ Metrics and Targets
globally offer useful solutions to the issue of climatechange, and will fulfill its social responsibilities regarding the various climate change-related impacts associated with the production and distribution processes.
As part of this, we expressed our support for therecommendations of the Task Force on Climate-related Financial Disclosures (TCFD) in March 2021.

Reducing GHG Emissions

Reducing Waste

The Kaneka Group will realize carbon neutral
operations by 2050. As an interim milestone, we haveset a target of reducing GHG emissions by 30 in 2030
compared to fiscal 2013.
In fiscal 2021, the sum total of the Kaneka Group’s
Scope 1 and Scope 2 GHG emissions was 1,547.9
thousand tons CO2e (0.2% increase from fiscal 2013).

The Kaneka Group is taking steps to reduce thegeneration of industrial waste and to promote its
recycling. Kaneka and its Group companies in Japan
have been working for zero emissions*1, which they
achieved in fiscal 2021.
Meanwhile, the Kaneka Group set the target of a 57%
recycling rate*2 for fiscal 2021 and has been moving
forward with related initiatives. The actual recycling
rate for fiscal 2021 was 56.3%.

GovernanceTo integrate and strengthen ESG management, we
reorganized our ESG-related operations with effect from
April 1, 2022, to establish a new organization known as
the Engine of Sustainability Management with an executive vice president as its general manager. Under its
supervision, the DX & Carbon Neutral Committee istasked with driving our carbon neutral production strategy.

The committee will promote carbon neutrality byaccelerating initiatives that integrate DX with carbon
neutral activities in the manufacturing field. Every
three months, the committee will report on its activities to management, who will discuss and decide thedirection of its activities going forward.

*1 Final landfill disposal less than 0.5% of total generated waste.
*2 Percentage of generated industrial waste that is externally recycled (i.e.,
outsourced industrial waste recycled through reuse or heat recovery).

Results of Assessment of Climate Change Risks and Opportunities (1.5 Scenario)● Climate change risk

Strategy
In fiscal 2020, to identify climate change-related
business risks and opportunities and to set out relevant strategies, metrics, and targets, we formulated
business impact scenarios in line with the 2 and 4
scenarios, as recommended by the TCFD, and analyzed the extent of the impacts.
In fiscal 2021, we conducted a review based on the
1.5 scenario in response to the Japanese government’s declaration in October 2020 that it aims toreach carbon neutrality by 2050.
To reflect the impact of the wider social environmenton the Kaneka Group’s businesses, we assessed the

Climate change risks and opportunities

impact of climate change on our four business domains (Solutions Units) in the short term (5 years),
medium term (10 years), and long term (30 years). We
will continue to move forward with quantitative analysis based on climate change scenarios to identify thefinancial impact of climate change-related risks andopportunities.
By taking initiatives to balance risk, we aim to boost
the competitiveness of each of our businesses andthereby deliver new value. In this way, we will turnrisk to our advantage.

Risk Management
We are formulating a production strategy for decarbonization, with measures ranging from energy saving andprocess innovation to fuel conversion, that takes
account of the Japanese government’s energy policy

and other factors in the business environment. We will
additionally use an internal carbon pricing system toensure that investment projects deliver both environmental value and economic benefit.

Kaneka Integrated Report 2022

Small ●●

Large

Material SU

Quality of Life
SU

Health Care
SU

Nutrition SU

Timing ofimpactRegulatory/legal

Strengthening of GHG emissions regulation

●

●

●

●

Long term

Regulatory/legal

Increased operational costs due to introduction ofcarbon tax (incl. supply chain)

●

●

●

●

Long term

Regulatory/legal

Regulation of GHG emissions in agricultural andlivestock sector●

Medium tolong term

TechnologicalAcceleration of the circular economy●●

TechnologicalLow-carbon trends affecting raw material and energy
sources●●Long term●●Long termMarketStructural change in automotive industry●

Medium tolong termMarketIncreased demand for biomass-based resins anddecreased demand for fossil-based plastics●

Long termMarketLand competition between agriculture, forestry, andbiomass production

MarketIntensified competition in sustainable agricultural
products

MarketImpact on price of metals (lithium, nickel, platinum) fromexpansion of new technologies●●

MarketDamage to stakeholder trust and weakening of branddue to delay in climate change response

●

●

●

●

Medium tolong term

Difficulty in securing human resources

●

●

●

●

Long termMarketIncreased demand for renewable energy, energy
networks, and energy-saving-related products●●

Chronic

Increased demand for reagents and therapeutics for
infectious diseases

Reputational72● Climate change opportunity●●

Medium tolong term●Long termLong term

Medium tolong term●Long term

Kaneka Integrated Report 2022

73

Business Foundation
For details, see our website.
https://www.kaneka.co.jp/en/esg/social/safety-quality/

Sustainability — Environment —Safety / Quality (Process Safety and Disaster Prevention, Occupational Safety)■ Preventing Pollution and Managing Chemical Substances■ Basic Policy

We are working for the prevention of air and waterpollution, the appropriate management of toxic chemical substances, and the reduction of related emissions.
Our production activities comply with the standards
specified in the Air Pollution Control Act and theWater Pollution Control Act as well as the criteria inagreements with local governments.
To promote water conservation, we monitor our
intake of water and take care to use it efficiently. In
fiscal 2021, we assessed water risk and identified

regions of high water stress. By calculating water
intake from high water stress areas as a proportion of
total water intake, we confirmed that the Kaneka
Group as a whole is not exposed to a high level ofwater risk.
In the area of chemical substance management, we
also reduce and control the emissions of volatileorganic compounds (VOCs) and chemical substances
subject to the Pollutant Release and Transfer Register(PRTR) Act, including six toxic air pollutants set independently.

TargetFiscal 2021 performance

Air and water pollution prevention

Chemical substanceemissions reduction

VOC emissions
1,800 tons or below

Strict compliance with standards set by Air Pollution Control
Act/Water Pollution Control Act and with criteria agreed
with local governments

Due to increased production volume and changes in

product mix, VOC emissions, at 1,905 tons, were not on
target■ Reducing Waste and Recycling Resources
Since waste reduction leads to maintaining and improving the global environment through resourcesavings, cost cutting, CO2 emission reduction and soon, we promote the 3Rs (Reduce, Reuse, and Recycle) company-wide. Through this effort, we promote

reduction and recycling of industrial waste. We willcontinue promoting the 3Rs as well as the improvement activities through process analysis using Material Flow Cost Accounting (MFCA).

Japan

Check legal compliance of waste disposal subcontractors

Diagram of Promotion System (April 1, 2022)
President (Representative Director)
Organs responsible for deciding policy and measuresand for auditing activities
The Engine of Sustainability Management
Safety Committee
Committee chair: director in charge of process
safety(Secretariat: Global Safety Integrity Center)

Corporate Manufacturing Integrity Center
Global Safety Integrity Center
Business divisions, staff departments,
manufacturing sites, research institutes,
Group companies

Fiscal 2021 performance aneka final landfill disposal rate: 0.2% or belowK ero emissions at Kaneka and Group companies inZcreate safe and healthy workplaces and share theimportance of safety with the goal of no accidents
and no disasters.

■ Promotion System and Policy

Organs responsible for implementing measures andactivities

TargetWaste reduction

Placing the top priority for management on safety, we
have established the Basic Policy on Safety, underwhich all employees as well as all persons working at
the Kaneka Group and our partner companies work to aneka final landfill disposal rate 0.053%
K ero emissions achieved by Kaneka and GroupZ

Established under the Engine of Sustainability Management, the Safety Committee sets policies andgoals related to occupational safety, process safety,
and disaster prevention and to check their implementation and progress. In his greetings at New Year andon the yearly anniversary of our foundation, the president delivers a related message directly to employees.

Message from the President
On my frequent visits to our plants, I sense a
growing safety awareness at each site and feelkeenly that this commitment to safety has beentaken fully on board by frontline staff.
However, we must never imagine that we haveperfected our safety system. Instead of relying on
the fact that safety measures have been put inplace, we must all take individual responsibility forensuring the safety of our team.
We in management will continue to work tirelessly to protect the lives of our employees and toensure their safety and peace of mind.

companies in Japan based on final landfill disposal
rate of 0.43%*

Visited disposal subcontractors where on-site

survey was possible and carried out checklistbased inspection* Zero emissions (Kaneka definition): final landfill disposal volume less than 0.5% of total generated waste.

As set out in our Basic Safety Policies, our Zero
Accident Principles, and the Kaneka Group Code of
Conduct, we prioritize safety above all else, observe
the principles of safety, and work to ensure thatsafe practice is taken on board and strictly adhered
to. In this way we seek to guarantee safety andpeace of mind through stable day-to-day manufacturing operations.

■ Biodiversity
Considering the impacts of our businesses on ecosystems, we at Kaneka strive to develop technologies,
materials and products that have less environmental
impact, as well as to mitigate the environmental
impact of our production. As part of our social contribution activity, we also support, participate in, andcooperate with the biodiversity activities of outside
bodies.
74

Kaneka Integrated Report 2022

・ Takasago Manufacturing Site: Kaneka Forestry for
the Future
・ Osaka Manufacturing Site: Settsu-no-mori Kaneka
Biotope・ Shiga Manufacturing Site: Walnut School

Kaneka Integrated Report 2022

75

Business Foundation
Safety / Quality (Process Safety and Disaster Prevention, Occupational Safety)■ Efforts to Ensure Zero Accidents

Basic Safety Policies

Zero Accident Principles● Safety forms our management foundation,● All people, you and me, are indispensable

and is the basis of all corporate activities.
We take action with priority given to ensuring safety inall activities in the company.

● Safety is everyone’s responsibility● Safety is the foundation of local and worldwide

We do not miss sparing the time to seek safety.
[Participation in safety]

communities’ confidence in Kaneka.
We do our best to develop their trust.

Based on a shared commitment to safety first, management andfrontline staff are advancing toward our goal of zero process accidents by working to foster a safe culture and ensure the intrinsic
safety of equipment, thus inspiring public trust in the safety of ourmanufacturing sites.

We ensure everyone is working safely.
[Pledge of zero accidents]● There is no trick to safety● Safety is based on our belief that

Safe CultureP romotion of safety awareness: Safety management training for

We always value a fundamental approach to it.
[Adherence to safety basics]“All accidents can be prevented.”
We always move forward without being satisfied withlukewarm results.

We endeavor to eliminate safety risks.
[Safety in advance]● Safety is the responsibility of every employeein accordance with his/her duties.
We fulfill our responsibilities by mutually clarifying theduties we have assumed.

plant general managers and production supervisorsE nsuring adherence to basic safety practice (the 3S’s, greetings,
handrail holding)D evelopment of physical awareness of danger: Hands-on training
to heighten sensitivity to danger based on learning through physical experience with virtual reality equipment● Be aware of potential danger● Where there is carelessness, there is thepossibility of an accident
We do not allow even a small chance of negligence.
[99%, yet 0%]● Safety must be maintained continuously.

Equipment SafetyE quipment safety assessment: Evaluation using HAZOP (Hazard

We ensure safety through steady efforts on a daily basis.

and Operability)
TargetFiscal 2021 performanceStrengthen process safety and disasterprevention
Ensure occupational health and safety
Process accidents
Occupational accidents

Zero accidents

ESG safety and quality inspections carried out at all parent manufacturing sites and8 sites of 6 Group companies in Japan
Emergency response and evacuation drills and comprehensive disaster prevention
drills carried out in readiness for emergency

 rocess accidents: 8
P ccupational accidents: Accidents resulting in lost time: 8; accidents not resulting inOlost time: 9.

Accident Frequency Rate

1.66

1.83

1.95

1.80

0.81
0.47

0.5
0

0.31
0.00

2017

0.10

2.09

0.09

0.09

0.09

0.09

0.09

0.08

Manufacturing Site

0.08
0.06

1.5
1.0

0.90

0.94

0.93

0.78
0.36
0.00

0.23

2018

0.52
0.00

2019

● All Kaneka Group ● All parent manufacturing sites● All Japanese industry ● Chemical industry

0.06

1.07

0.26
0.18
0.00
2020

0.02

0.21
0.19
2021

0.03

0.04

0.60

(Year)All Group companies in Japan and overseas

Accident Frequency Rate: An indicator that shows the frequency of occupational
accidents that caused death and/or injury by indicating the number of casualties
per total 1 million actual working hours.

0

0.01
0.01
0.00

2017

0.02
0.00

2018

0.03
0.02
0.02
0.01
0.00

2019

● All Kaneka Group ● All parent manufacturing sites● All Japanese industry ● Chemical industry

0.02
0.00
0.00
0.00

2020

0.00
0.00 0.00
2021(Year)All Group companies in Japan and overseas(Number)
20

10

2

5

5

0

2
2017

76

5
6
1
2018

5
5

9
2
1
2019

Kaneka Integrated Report 2022

1

4

4

3

2020

2021 (Year)

Participants

Details

December 13, 2021

2,078

An earthquake resulting in a hazardous material
leakage

Osaka
Manufacturing Site

November 10, 2021

1,024

An earthquake resulting in a fire

Shiga
Manufacturing Site

December 20, 2021

446

An earthquake resulting in a fire

KashimaManufacturing Site

March 7 and 14, 2022

120

A fire caused by flammable gas leakage

Safety Awards

Accidents Resulting/Not Resulting in Lost Time

7

Date

Takasago
Manufacturing Site

Accident Severity Rate: An indicator that shows the level of severity of occupational
accidents by indicating the number of lost work days per total 1,000 working hours.

* Both rates are calculated targeting employees at Kaneka and Group companies.

15

We annually conduct comprehensive disaster drills, based on
scenarios such as a large-scale earthquake or a fire caused byhazardous material leakage, jointly with local governments andlocal industrial facilities so that we can promptly and effectively
respond to emergency situations.

Accident Severity Rate

2.5
2.0

Comprehensive Disaster Drills

Lost time at Kaneka
No lost time at Kaneka
Lost time at Group companies
No lost time at Group companies

In May 2021, our Shiga Manufacturing Site received the Safety
Excellence Award in an award scheme operated by the Japan
Chemical Industry Association to recognize business sites that
conduct exemplary safety activities. Across the Kaneka Group as awhole, four companies received designation as a ’certified safe
business site.’
Going forward, we will continue raising safety awareness toward
our goal of zero accidents.

* The number of occupational accidents includes those among employees at Kaneka
and partner companies working in the Kaneka Group.

Kaneka Integrated Report 2022

77

Business Foundation
Safety / Quality (Product Responsibility)

For details, see our website.
https://www.kaneka.co.jp/en/esg/social/safety-quality/■ Basic Policy■ Chemical Substance Management

Aiming to benefit society and satisfy customers
through a stable supply of safe and reliable products,
the Kaneka Group has set Quality Management

Regulations to ensure thorough day-to-day quality
control and product safety at all stages, from productdesign and development to delivery to customers.

■ Promotion System and Policy
Diagram of Promotion System (April 1, 2022)
President (Representative Director)
Organs responsible for deciding policy and measuresand for auditing activities, conferences
Corporate Manufacturing Integrity Center
Global CSV (Quality Environment) Center
Quality Management Conference
Product Safety Review Conference

Organs responsible for implementing measuresand activities

The Global CSV (Quality Environment) Center operates
the Quality Management Conference and the Product
Safety Review Conference. Through these bodies, we
coordinate quality assurance activities throughout the
Kaneka Group and drive quality management, including product safety assurance, at all stages from product design and development to raw material procurement, manufacturing, storage, and transportation.
Each of our businesses undergoes regular third-party
auditing and inspection based on ISO 9001 and otherestablished standards and regulations. We also takesteps in-house to enhance our quality management
system and thereby raise product quality standards
through ESG safety and quality inspections and internal audits.

Business divisions, staff departments, manufacturing
sites, research institutes, Group companies■ Quality Assurance InitiativesW e reviewed our systems to ensure strict legal
compliance following the revision of the Pharmaceutical Affairs Law and confirmed the introduction of
HACCP (hazard analysis and critical control point) in
response to the revision of the Food Sanitation Act.

External experts were deployed by food-relatedW e held quality management conferences on fouroccasions, inviting personnel in charge of quality
management in each business division, to instill
the Company-wide policy and instructions and to
exchange views on product quality assurance andshare quality information.

An internal audit checklist was sent to the produc-T o facilitate timely and speedy response to thedemand for PCR test diagnostics during the continuing COVID-19 pandemic and to the market demand
for sustainability-friendly solar roof systems, theadministrative office of the Product Safety Review
Conference conducted active pre-consultations tocover safety issues and put in place a service delivery system.

78

Kaneka Integrated Report 2022

Group companies to conduct ongoing checks on theoperation status of quality management systems
and hygiene management, including in the supply
chain, as a way to further improve quality.
tion, sales, and administration divisions of Group
companies for self-check to enhance the quality
system while quantitative evaluation was carried out
to identify its strengths and weaknesses. Where
weaknesses were found, efforts were made in cooperation with the supervising business department
to plan for the next fiscal year’s checking operations
as a way to target improvement.
Going forward, we will continue working to enhance
the quality management system, including in the
supply chain, through audits, inspections, and otherchecks and human resource training. In this way, we
aim to ensure full compliance and product safety.

We take appropriate action at all stages of productdevelopment, manufacturing, transportation,
sales, and disposal based on a clear grasp of therequirements of Japanese and international laws
and regulations on the management of chemical
substances, with each division adapting its
response to its particular circumstances. For raw
material procurement, we have established theGreen Procurement Standards to prevent mixing ofchemicals prohibited under the Control Act.*1 Whensupplying products, we take active measures toconvey information on the hazard level of the chemical
substances, including displaying a GHS*2 label andproviding a product safety data sheet.
We also take careful note of legislative trends. Amongthe changes in recent years have been revisions
to Chinese law requiring advance registration of
new chemical substances and revisions to South
Korean occupational safety law and UK law on theregistration, evaluation, authorization and restriction ofchemical substances (REACH). Our response to thesechanges includes the use of external consultants.
*1 Chemical Substances Control Act: Act on the Evaluation of Chemical
Substances and Regulation of Their Manufacture, etc.
*2 GHS: A worldwide system for classifying and labelling chemicals according
to their hazardous properties.

Supply Chain Management■ Basic Policy
The Kaneka Group works to build relationships of trustwith its business partners (suppliers) with the aim ofmutual increase in corporate value. Under our Basic
Procurement Policy, we pursue efficient procurement
activities that also take account of fairness and equity
in terms of ensuring safety and quality, protecting the
global environment in areas such as climate change
and biodiversity, showing respect for human rights,
and ensuring legal compliance.

In 2015, we signed the United Nations Global
Compact to show our agreement with its principles
for voluntary action in the four areas of Human Rights,
Labour, Environment, and Anti-Corruption. In 2018,with the aim of further evolving our ESG management,
we additionally set out an ESG Charter as an action
agenda for each individual employee to help realize
our corporate philosophy. On this basis, we pursue
procurement activities for a sustainable society.

■ Responsible Procurement Initiatives
In all procurement activities within the framework ofour business operations, we undertake responsible
procurement and management of raw materials
and other resources. Our Basic Procurement Policy
requires the general manager of each businessdivision to put in place and take charge of an
appropriate system to manage procurement, includingthat of mineral raw materials, with the cooperation ofbusiness partners.
Additionally, as part of sustainable raw material
procurement that takes due account of theenvironment and human rights, we have acquired
RSPO supply chain certification.

■ Declaration of Partnership Building
Based on the belief that it is important to actively workon strengthening the supply chain, Kaneka endorses
the aims of the Council on Promoting Partnership
Building for Cultivating the Future advanced by
the Cabinet Office and other related ministries
and agencies. We announced our Declaration ofPartnership Building in October 2022.
The aim is to build new partnerships by promoting
cooperation, coexistence, and coprosperity withbusiness partners in the supply chain and otherbusiness operators seeking to create value.

Kaneka Integrated Report 2022

79Business Foundation
Communication with Stakeholders

For details, see our website.
https://www.kaneka.co.jp/en/esg/social/stakeholder/■ Basic Policy
Under its ESG Charter, which declares that ‘we fulfill
our corporate responsibility by empowering individual
employees to put our corporate philosophy into practice through serious, forward-looking effort,’ theKaneka Group, aspires as a good corporate citizen to asustainable future in partnership with all its stakeholders.
We will work to build relationships of trust with stakeholders through active information disclosure andcommunication with the aim of realizing this sustainable society.

Providing technology and product information and online
store on our official website

Holding exhibitions

Communication

Customers© WFP/Michael Duff
Sponsoring the UN World Food Programme (WFP) School
Lunch Support Program as a Partner Company

Communication with customers through sales and marketing●

Information posting on websites and social media●

Exhibitions●

Quality assurance/customer support

The
Environment

Society

Holding the Kaneka Manufacturing Class●

Communication●

Interaction with local residents/participation in local events/dialogue●

Fostering youth development/hosting plant visits●

Supporting disaster reconstruction●

Participation in initiatives

KanekaGroup
Carrying out local clean-up activities

Communication●●●

Communication

Shareholders
andInvestors

Opinion exchange with investors/analysts, holding ofbusiness and results briefings

Vendors

Timely and appropriate information disclosure on thecorporate website●

Initiatives on global environment protection/resource
conservation/environmental impact reduction●

Promotion of environmental impact reduction in raw
material procurement●

Cleaning activities/local forest conservation/environmental
conservation activities●

Appropriate information disclosure

General Meeting of Shareholders
010_0127801142206.indd

22022/05/27

15:53:00

Issuing reports (To Our Shareholders)
twice a year

Employees

Communication●

Regular questionnaire surveys and dialogue
with vendors

Communication●

Empowering of diverse humanresources●

Cooperation, coprosperity and coexistence withvendors●

Employee health●

Quality improvement in logistics operations●

Labor-management links●

Appropriate information disclosure●

Internal whistleblowing system●

Internal whistleblowing system

Publishing four issues a year of “Kaneka News,” Offering “Healthy Eating and Eating Environment”
an in-house newsletter that strengthens ties
certified smart meals at plant canteens
and relationships within the Company

80

Kaneka Integrated Report 2022

Providing an online store that connects with bakeries nationwide
by supporting the purchase and development of ingredients

Kaneka Integrated Report 2022

81

Appendices
Consolidated Financial Statements
CONSOLIDATED BALANCE SHEETSKANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIESMarch 31, 2022 and 2021

AssetsMillions of yen

Thousands of
U.S. dollars*

2021

2022

2022

Current assets:
Cash and cash equivalents

Thousands of
U.S. dollars*

2021

2022

2022

Current liabilities:¥

40,712¥

46,360$332,646—

135,618—

Notes and accounts receivable—trade, and contract assets

164,128—

1,341,028

Inventories

Notes and accounts receivable—trade

Liabilities and Net assets

Millions of yen¥

Short-term loans payable
Current portion of long-term loans payable

84,014¥74,832$

686,446

5,978

9,349

48,847752,257

Notes and accounts payable:

140,483

109,685

1,147,833

Trade92,06875,757

Short-term loans receivable from unconsolidated subsidiaries and affiliates

1,481

1,667

12,103

Construction

6,353

8,706

51,914

Other current assets

17,656

17,114

144,261

Other

20,77018,801

169,710

Allowance for doubtful accounts(1,552)(1,423)(12,680)

Income taxes payable

3,466

4,376

28,325362,910309,024

2,965,193

126,375

Total current assets

Accrued expenses

15,467

14,410

Other current liabilities

6,382

6,068

52,146

Total current liabilities

234,502212,303

1,916,024

Non-current liabilities:

Property, plant and equipment:
Land

32,85531,744

268,452

Buildings and structures

228,539

219,730

1,867,301

Machinery, equipment and vehicles

640,545614,774

5,233,645

Construction in progress

24,10521,808

196,958

Other

6,549

6,186

53,516

932,596894,2457,619,874

Less accumulated depreciation(661,321)(625,081)(5,403,390)

Property, plant and equipment, net

271,275

269,164

2,216,483

Bonds payable

10,00010,00081,706Long-term loans payable

28,62725,161

233,905

Net defined benefit liability

31,55932,073257,864

295

314

2,415

Deferred tax liabilities

2,018

1,647

16,495

Provision for product warranties

2,331

—

19,045

Other non-current liabilities

5,420

4,889

44,286

Total non-current liabilities

80,25374,085655,719

Provision for directors’ retirement benefits

Contingent liabilities
Net assets:
Shareholders’ equity:
Capital stock
Authorized — 150,000,000 shares
33,04633,046

270,012

Capital surplus

31,392

31,103

256,494

Retained earnings

309,507289,5442,528,859(11,528)(11,535)(94,198)

362,417342,159

2,961,167

21,331

20,863

174,290

(4)

(9)

(38)
35,798IssuedIntangible assets:

14,977

122,375

13,829—	  68,000,000 shares

Less treasury stock, at cost — 2,761,323 shares in 2022
		

2,762,766 shares in 2021

Total shareholders’ equity
Accumulated other comprehensive income:Investments and other assets:

Valuation difference on available-for-sale securities

Investment securities

Deferred gains or losses on hedges

Unconsolidated subsidiaries and affiliates

3,635

3,523

29,700Foreign currency translation adjustments

4,381(3,753)

Other55,10754,526450,257

Remeasurements of defined benefit plans(975)(2,160)(7,969)

660

761

5,399

24,732

14,939202,080

619

516

5,057

Long-term loans receivable
Deferred tax assets

7,504

6,206

61,312Other

11,19010,62391,434

(300)

(229)

(2,458)77,79675,411

635,647

Allowance for doubtful accounts
Total investments and other assets¥ 726,959¥

667,429$

5,939,699

Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
Total net assets

24,43523,424

199,649

412,204

381,040

3,367,956¥ 726,959¥

667,429$

5,939,699* The translation of the Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan, using theprevailing exchange rate on March 31, 2022, which was ¥122.39 to U.S. $1.00.

82

Kaneka Integrated Report 2022

Kaneka Integrated Report 2022

83

Appendices
CONSOLIDATED STATEMENTS OF INCOMECONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETSKANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIES
Years ended March 31, 2022, 2021 and 2020

KANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIES
Years ended March 31, 2022, 2021 and 2020
Thousands of
U.S. dollars*Millions of yen

Net sales¥

2022
691,530¥2021
577,426¥2020
601,514$2022
5,650,216

Shareholders’ equity

2022

Cost of sales

494,880

410,486

432,374

4,043,474

Capital stock

Gross profit

196,649

166,940

169,139

1,606,742

Selling, general and administrative expenses

153,086

139,395

143,124

1,250,811

Balance at beginning of year

Operating income

43,562

27,54426,014355,930

Total changes of items during the period

Interest and dividend income

1,648

1,445

1,684

13,469

Capital surplus

Interest expenses(1,064)(1,259)(1,714)(8,694)

Balance at beginning of year

Gain on sales of investment securities

19

796

627

158

Changes of items during the period

Gain on sales of property, plant and equipment

—

—

315

—

Income from compensation for damage

—

1,624

—

—

Change in treasury shares of parent arising from transactions
with non-controlling interests

Loss on disposal of property, plant and equipment(1,638)(2,402)(1,916)(13,389)

Foreign exchange gains (losses), net

1,159

250

(968)

9,475

Balance at the end of current period

Equity in earnings of affiliates, net

132

109

150

1,084

Retained earnings

Litigation expenses

—－

(289)

(996)

—

Restructuring charges(2,692)——(22,000)

Impairment losses(1,059)(897)—(8,654)

Product warranty expenses(2,331)——(19,045)

Loss on disaster—(1,099)——Gain on contribution of securities to retirement benefit trust

—

—

378

—

(1,331)Other, net
Income before income taxes and non-controlling interests(3,621)(3,777)

Total changes of items during the period

Balance at beginning of year
Dividends from surplus—¥100.00 per share
Change of scope of consolidation
Net income attributable to owners of parent

1,240

1,353

1,475

10,136
216,418(1,821)

2,361

289

141

(1,821)

2,361

31,392

31,10330,962

256,494

289,544

280,265

272,9442,365,749(6,523)(6,523)(6,848)(53,300)

—

(21)

167

—

26,487

15,831

14,003

216,418

(1)

(7)

(1)

(8)

(3)

(4)

(35)

52

23

85

Valuation difference on available-for-sale securities
Thousands of
U.S. dollars*

2022
226,555

Other comprehensive income:
455

6,746

(5,437)

3,723

5

93

7

41

Foreign currency translation adjustments

8,495

3,924

(3,668)69,410Remeasurements of defined benefit plans

1,179

5,825

(2,280)9,638

Comprehensive income

141

(4)

Accumulated other comprehensive income

Total other comprehensive income

289

10

KANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIES
Years ended March 31, 2022, 2021 and 2020

Share of other comprehensive income of associates accounted forusing equity method

254,133

Disposal of treasury stock

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Deferred gains or losses on hedges

32,784Purchase of treasury stock
Total changes of items during the period

Valuation difference on available-for-sale securities

30,962

Changes of items during the period

Balance at the end of current period$

31,103(94,248)

Net income attributable to non-controlling interests

2020
15,479270,012(11,601)(11,424)
226,555¥

33,046(11,583)(490)
15,4792021
17,18433,046(11,535)

Balance at beginning of year

(1,354)¥33,0462,528,859

17,1842022
27,728—280,265

Treasury stock(1,398)¥—289,544

82,32027,728Net income—

309,507

4,809

Millions of yen—

Balance at the end of current period
6,372

$

270,012163,109

10,07514,003$

7,321

297,451¥

33,046

9,278

19,797

15,831¥

19,963

22,201¥

33,046

Changes of items during the period

36,40526,487¥

Total changes of items during the period

Deferred¥2022(10,881)Net income
Net income attributable to owners of parent

2020

2021

Disposal of treasury stock

Income taxes
Current

33,046

Thousands of
U.S. dollars*

Changes of items during the period
Balance at the end of current period

Other income (expenses):¥Millions of yen

(7)

10

(0)

(61)

10,12816,600(11,379)

82,752¥37,856¥33,784

¥

4,099

$

309,307¥36,280¥31,978

¥

2,976

$

296,434

Balance at beginning of year

6

48

18

49

(11,528)(11,535)(11,583)(94,198)

20,863

14,246

19,642

170,464

468

6,616

(5,395)

3,825

Changes of items during the period
Net changes of items other than shareholders’ equity

468

6,616

(5,395)

3,825

21,331

20,863

14,246174,290

(9)

(103)

(110)

(79)

5

93

7

41

Total changes of items during the period

5

93

7

41

Balance at the end of current period

(4)

(9)

(103)

(38)

Total changes of items during the period
Balance at the end of current period
Deferred gains or losses on hedges
Balance at beginning of year
Changes of items during the period
Net changes of items other than shareholders’ equity

Comprehensive income attributable to:Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

1,575

1,806

1,123

12,872* The translation of the Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan, using theprevailing exchange rate on March 31, 2022, which was ¥122.39 to U.S. $1.00.

84

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Kaneka Integrated Report 2022

85

Appendices
CONSOLIDATED STATEMENTS OF CASH FLOWSKANEKA CORPORATION AND CONSOLIDATED SUBSIDIARIES
Years ended March 31, 2022, 2021 and 2020

2022

Millions of yen

Thousands of
U.S. dollars*

2020

2022

2021

Foreign currency translation adjustments
Balance at beginning of year¥(3,753)¥

(7,395)¥(4,008)$

(30,671)

Changes of items during the period
Net changes of items other than shareholders’ equity

8,135

3,641

(3,387)

66,470Total changes of items during the period

8,135

3,641

(3,387)

66,470

Balance at the end of current period

4,381(3,753)(7,395)35,798(2,160)(7,956)(5,705)(17,649)

Net changes of items other than shareholders’ equity

1,184

5,796

(2,250)9,679

Total changes of items during the period

1,184

5,796

(2,250)9,679

Balance at the end of current period(975)(2,160)(7,956)(7,969)

516

482

431

4,221

Net changes of items other than shareholders’ equity

102

34

50

836

Total changes of items during the period

102

34

50

836

Balance at the end of current period

619

516

482

5,057

23,424

22,12823,302

191,395

Remeasurements of defined benefit plans
Balance at beginning of year
Changes of items during the period

Subscription rights to shares
Balance at beginning of year
Changes of items during the period

Non-controlling interests
Balance at beginning of year
Changes of items during the period
Net changes of items other than shareholders’ equity

1,010

1,295

(1,173)

Total changes of items during the period

1,010

1,295

(1,173)

8,254
8,254

Balance at the end of current period

24,43523,424

22,128

199,649

381,040

354,094

360,726

3,113,328(6,523)(6,523)(6,848)(53,300)

Total net assets
Balance at beginning of year
Changes of items during the period
Dividends from surplus—¥100.00 per share

—

(21)

167

—

26,487

15,831

14,003

216,418

Purchase of treasury stock

(4)

(3)

(4)

(35)

Disposal of treasury stock

9

44

21

76

289

141

(1,821)

2,361

Net changes of items other than shareholders’ equity

10,905

17,477(12,149)

89,106

Total changes of items during the period

31,163

26,945(6,631)

254,627

Change of scope of consolidation
Net income attributable to owners of parent

Change in treasury shares of parent arising from transactions
with non-controlling interests

Balance at the end of current period¥

412,204¥

381,040¥

354,094$

3,367,956* The translation of the Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan, using theprevailing exchange rate on March 31, 2022, which was ¥122.39 to U.S. $1.00.

86

Kaneka Integrated Report 2022

2022

Cash Flows from Operating Activities
Income before income taxes and non-controlling interests
Depreciation and amortization
Restructuring charges
Impairment losses
Product warranty expense
Insurance claim income
Gain on contribution of securities to retirement benefit trust
Income from compensation for damage
Increase (decrease) in net defined benefit liability
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expenses
Equity in earnings of affiliates, net
Loss (gain) on disposal of property, plant and equipment
Gain on sales of investment securities
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
OthersSubtotalInterest and dividend income received
Interest expenses paid
Proceeds from insurance income
Proceeds from compensation for damage
Income taxes paid
Net cash provided by operating activities
Cash Flows from Investing Activities
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 and distributions of investment securities
Proceeds from redemption of investment securities
Purchase of shares of subsidiaries resulting in change in scope of consolidation
Proceeds from purchase of shares of subsidiaries resulting in change
in scope of consolidation
Payments of loans receivableCollection of loans receivable
OthersNet cash used in investing activities
Cash Flows from Financing Activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Repayments of lease obligations
Purchase of treasury stock
Proceeds from sales of treasury stock
Cash dividends paid
Proceeds from share issuance to non-controlling shareholders
Cash dividends paid to non-controlling interests
Payments from changes in ownership interests in subsidiaries
that do not result in change in scope of consolidation
Net cash 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
Increase in cash and cash equivalents resulting from change ofscope of consolidation
Cash and cash equivalents at end of period¥¥

36,40537,953
2,692
1,059
2,331
(1,671)——879
162(1,648)
1,064
(132)
498
(19)
(25,608)(27,541)
14,6283,328
44,381
1,717(1,085)
512—(11,419)
34,106

Millions of yen

Thousands of
U.S. dollars*

2020

2022

2021

¥

22,201
36,262—897———(1,624)2,034
59(1,445)
1,259
(109)
765
(796)
(246)
8,838
1,392
6,221
75,7101,533(1,325)—
1,624(3,502)
74,040¥19,79734,340
—
—
—
—
(378)
—
896
67
(1,684)
1,714
(150)
53
(627)
13,197(5,572)(11,120)(4,083)46,4501,787(1,721)——(6,531)
39,983$

297,451
310,104
22,0008,654
19,045(13,656)
—
—
7,187
1,330
(13,469)8,694(1,084)4,075(158)(209,237)(225,034)
119,525
27,194
362,622
14,036(8,873)
4,185—(93,301)
278,670(37,329)—(2,601)
(77)
877
—
(336)

(39,431)—(2,965)
(74)
57
104
—

(42,977)725(3,297)
(175)
867
4,000
—

(305,006)—(21,252)
(633)
7,167
—
(2,746)

—
(398)
632
(362)
(39,595)

—
(874)
1,145
(1,191)(43,229)37(1,238)872(620)(41,807)—(3,256)
5,170(2,961)(323,519)

6,606
9,119
(9,390)
—
—
(618)
(4)
0
(6,523)0(231)(3,515)776(11,712)
—
—
(501)
(3)
0
(6,523)—(260)

14,121
1,362(4,366)
10,000(10,000)
(244)
(4)
0
(6,848)390(314)

53,98274,513(76,726)——(5,052)(35)
3(53,303)0(1,893)(63)(1,105)946(5,647)46,360(162)(21,903)
(198)
8,708
37,606(4,574)(479)(201)(2,505)39,970(521)(9,033)
7,734(46,146)
378,793—
40,712¥45
46,360¥141
37,606$—332,646

Kaneka Integrated Report 2022

87

AppendicesFinancial Highlights

Nonfinancial Highlights

Net Sales / Operating Income

Net Income Attributable to Owners of Parent / ROE(Billions of Yen)

(Billions of Yen)

1,000
800

36.9

36.0

596.1

621.0

601.5

600

43.6

50

691.5

40

577.4

40

(%)

6.8

6.7

30
21.6

30

27.5

26.0

(Billions of Yen)

22.2

20

400

14.0

20

200

10
2017

0

2018

2019

2020

2021 (Fiscal year) 0

Net sales
Operating income (right scale)

45.1

500
40.2

312.2

58.8

200

44.7
100
0

249.7
22.9

6.0

0

2018

2019

59.3

26.0

48.8

236.6
53.4

26.5

47.3

231.2
52.9
42.4

22.8

73.6

34.0

(10 thousand kL)100.0

15.8

2020

2021 (Fiscal year) 0

0

2018

2013
(Base year)

30

300

51.0

360.7

354.1

51.1

50.7

381.0
53.5

412.2
80
53.3

200

40

10

100

20

0

Other

2019

2020

2021 (Fiscal year) 0

New Product Sales / New Product Sales Ratio

0(%)(Million m3)

40

8.0

300

30

40

24

24

24
30

6.0
200
138.6

4.0

155.0

60

60

14.9

103.2

102.2

107.2

20

20

2019

2020

2021 (Fiscal year)

0

15.8

146.2

165.7

20

137.5

100

2018

2019

R&D expenses
R&D expenses ratio (right scale)88

Kaneka Integrated Report 2022

2020

2021 (Fiscal year) 0

1996

10

2017

2018

New product sales
New product sales ratio (right scale)

14.6

7.6

7.3

44.7

43.2

44.6

48.4

2018

2019

2020

2021 (Fiscal year)

11.7

15.4

17.0

7.6

7.9

7.9

45.6

44.0

2013
(Base year)

2017

68

80
60

7.4

40

2,000

72

66

65

20

1,758
1,579

1,905

1,743

1,587

1,500

47

43

37

71.9
16.2

40

40

40

1,000

1515

1618

7 5

8 6

2017

2018

19
14

1716

1617

7 7

8

5

9 7

2019

2020

2021 (Fiscal year)

500

0

2017

2018

2019

2020

2021

(Fiscal year)

Volume and Rate of Waste Sent to Final Landfill(Tons)

33.4
7.7
3.8

10

0

14.9

69.7

100

Volatile Organic Compounds Emissions

33.9
9.0
3.3

36.9
11.7
3.5

35.5
10.7
3.3

37.7

12,000

10.1

21.6

21.8

21.5

2019

2020

2021 (Fiscal year) 00

Kaneka20172018Group companies in Japan

2019

2020

3.3

15

8,000

24.3

2021

Group companies outside Japan

18

16.3

12
5,231

6,000
22.0

(%)

11,54910,000

20

2.0

2017

66.5

67.3

5.4

4,000

(Fiscal year)

0

4,684
5.5

5,294

6,301
5,110

5.1
2.7

2,000
0

65.7

65.0

90.4

KanekaGroup companies in Japan
Group companies outside Japan
Energy intensity index for all parent manufacturing sites (right scale)

Water Consumption(Billions of Yen)

25

35

20

(%)

23

32.8

28.4

92.4

91.6

■ Amount of waste generated by Kaneka ■ Amount recycled by Kaneka■ Amount of waste generated by Group companies in Japan■ Amount recycled by Group companies in Japan■ Amount of waste generated by Group companies outside Japan■ Amount recycled by Group companies outside JapanNet assets
Shareholders’ equity ratio (right scale)

30.9

80

14.8

60

60

20

2018

80
154.8

(%)

94.9

91.9

(Tons)

71
63

40

2017

145.5

100

Waste Generated and Recycled

346.6

2021 (Fiscal year) 0

10

2017

29.4

85.8

100

40

50

(Billions of Yen)

20

110.5

148.4

91.6

KanekaGroup companies in Japan
Group companies outside Japan
CO2 emission intensity index for all parent manufacturing sites (right scale)

62.7

4.5

112.2

400

2020

4.8

115.9

95.7

100

40

2019

4.9

16.8

80

2018

4.7

34.2

16.9

(Thousand tons)

2017

4.7

32.0

(%)

113.1

27.8

161.4

100

109.3

28.0

161.1

500

R&D Expenses / R&D Expenses Ratio

30

154.5
23.1
15.5

200

(Billions of Yen)

115.7

29.4

91.4

(%)

110.0

29.0

91.5

250

50

142.0

Asia
North America
EuropeOverseas sales ratio (right scale)

GHG Emissions(10 thousand
tons-CO2e) 100.0

150

2.0

2017

Energy Consumption and Energy Intensity Index

4.0

10

40.0

39.3

400

236.4

26.5

Net Assets / Shareholders’ Equity Ratio(Billions of Yen)

300

8.0

Net income attributable to owners of parent
ROE (Return on equity) (right scale)

Overseas Sales / Overseas Sales Ratio

39.7

4.2

4.6

7.1

GHG Emissions and Energy Origin CO2 Emission Intensity Index

0.9
1996

9
6

1.9

3
806 2.2 875 23.1 738 29.4 450 34.5 316
0.035
0.041
0.053
0.001
0.003
2017
2018
2019
2020
2021 (Fiscal year)

KanekaGroup companies in Japan
Group companies outside Japan
Final landfill disposal rate for Kaneka (right scale)● Final landfill disposal rate for Group companies in Jpan (right scale)

Kaneka Integrated Report 2022

89

AppendicesNonfinancial Highlights

Corporate Profile
Corporate Profile (March 31, 2022)

Number of Female Executives and Level 1 Assistant Managers

Number and Rate of Employees Taking Childcare Leave(Persons)(Persons)

(%)

80

60

120

100

100

100

100

100

Name

KANEKA CORPORATION

OfficesTokyo Head Office

40

29
40
10
20

0

17

18

20

22

26

2017

2018

2019

80

20
28

20

33

2 2
2020

2021

18

(Fiscal year)

0

2017

5

14

9

4

2018

19

2019

17

19

22

Osaka (Osaka Prefecture)
Kashima (Ibaraki Prefecture)40

Osaka Head Office

14
2020

Shiga (Shiga Prefecture)

Fax: +81-3-5574-8121

31

2-3-18, Nakanoshima, Kita-ku, Osaka
530-8288, Japan

2021 (Fiscal year) 0

Research
Institutes

Number of employees: Men
Women
Rate: ● Men (right scale) ● Women (right scale)

Number of Level 1 Assistant Managers

Employment Rate of Persons with Disabilities

Return Rate of Employees Taking Childcare Leave
100

(%)

100

100

100

100

3.0

95

94

98

95

2.5
2.0

93

Paid-in Capital

33,046 million yen

Number of
Employees

11,335 (Including consolidated subsidiaries)
3,472 (Non-consolidated)

2.19
2.0

2.17

2.21

2.2

2.2

2.38
2.2

Photovoltaic & Thin Film Device ResearchLaboratories
Engineering Research Laboratories
Process Development Research Laboratories
Green Planet Technology Laboratories
AffiliatedCompanies

112 Subsidiaries

URL

https://www.kaneka.co.jp/en/esg/

2.53
2.3

Electronics Research Laboratories(Including 43 (in Japan) and 47 (outside Japan)
consolidated subsidiaries)

1.5

90

Global Network (March 31, 2022)

1.0
85
0.5
2017

80
● Men

September 1, 1949

(%)

100
95

Fax: +81-6-6226-5037
Date of
Establishment

Material Solutions New Research Engine
Regenerative Medicine and Cell Therapy
Laboratories

Tel: +81-6-6226-5050
Number of Executives

Nagoya (Aichi Prefecture)
Takasago (Hyogo Prefecture)

Tel: +81-3-5574-8000

20

Sales Office
Manufacturing Site

1-12-32, Akasaka, Minato-ku, Tokyo
107-6028, Japan

47

60

Facilities in
Japan

2018

2019

2020

2021

0

(Fiscal year)● Women

2017

2018

2019

Employment rate of persons with disabilities

2020

2021

(Fiscal year)

We will establish a head office in each region so that we can run our business in a way that is rooted in the region.
The Kaneka Group operates in 21 countries around the world, including Japan.

Legally mandated employment rate

Europe12
companies
Training Costs (per Person)

Number of Days and Rate of Paid Leave Taken(Thousands of yen)(Days)

100
80

Kaneka Europe Holding N.V.
(%)

20
73.0

100

76.7
64.5

60

58.4

59.7

15

65.0
12.4

66.3
12.8

70.3
13.6

66.6

68.0

13.0

13.2

75

10

50

5

25

40
20
0

2017

2018

2019

2020

2021 (Fiscal year)

0

2017

2018

Number of days of paid leave taken
Rate (right scale)90

Kaneka Integrated Report 2022

2019

2020

Japan
43
companies

Asia
27
companies

2021 (Fiscal year) 0

North
America
8
companies
Kaneka Americas Holding, Inc.

Kaneka Asia Co., Ltd.

Kaneka Integrated Report 2022

91

Appendices
Investor Information

Editorial Policy

Stock Basic Information (March 31, 2022)
Shareholder Composition

CommonStock Traded

Tokyo, Nagoya*Transfer
Agent

Mitsubishi UFJ Trust and Banking
Corporation

Accounting
Auditor

KPMG AZSA LLC

1.6%

150,000,000 shares

Issued Shares

68,000,000 shares

Number of
Shareholders

21,191

Financial institutions
34,702,000 shares(62 shareholders)

7.3%

Foreign companies
15,551,000 shares(352 shareholders)

17.2%
Number of
Shareholders

Authorized Capital

The Kaneka Integrated Report 2022 was prepared as a booklet reporting
financial and non-financial information. We hope that it will help stakeholders understand the Kaneka Group's medium- to long-term value creation.
The Kaneka Group is strengthening its efforts in ESG management with theaim of caring for the life of the earth and helping to build a sustainable
society.
In this report, we convey our strong determination toward our mission,‘KANEKA thinks “Wellness First.”’ We outline how we find a healthy balance between social value and economic value creation through our business so that we can help solve social issues.
We hope that this will help our shareholders, investors, and other stakeholders deepen their understanding of our company.

21,191

Individuals and others
51.0%

11,682,000 shares(20,456 shareholders)Other companies
4,990,000 shares(267 shareholders)

22.9%

Financial instruments firms
1,073,000 shares(45 shareholders)Notes: Share numbers are rounded down to the nearest thousand.
Percentages are rounded to the nearest decimal point.

* We applied for delisting from the Nagoya Stock Exchange (Prime Market) on
April 25, 2022 and Kaneka’s stocks were delisted on June 11, 2022.

Cautionary Statement Regarding Forward-looking Statements
Major Shareholders

The forward-looking statements in this report are based on information currently available to the Company andcertain assumptions that the Company deems to be reasonable. Such statements do not constitute a commitmentby the Company that they will be achieved. Actual results may differ significantly due to various factors.

Share Units Owned(thousand shares)

Percentage of Total
Shares Issued (%)

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

8,801

13.49

Reporting Organizations

Custody Bank of Japan, Ltd. (Trust Account)

3,363

5.15

Nippon Life Insurance Company

3,114

4.77

Sumitomo Mitsui Banking Corporation

3,091

4.74

Meiji Yasuda Life Insurance Company

2,825

4.33

Custody Bank of Japan, Ltd. (Trust Account No. 4)

2,689

4.12

MUFG Bank, Ltd.

2,308

3.54

Mitsui Sumitomo Insurance Company, Limited

2,104

3.23

The scope of reporting includes Kaneka and its consolidated group companies in Japan and overseas. However, thescope of data concerning Responsible Care activities covers Kaneka and 63 Group companies (47 in Japan and 16
overseas).
In this document, Kaneka Corporation is referred to as “the Company” or “Kaneka” and Kaneka Corporation and its
group companies are referred to as “the Group” or “Kaneka Group.” Where the text refers only to “Group companies,” this does not include Kaneka Corporation.
The totals of figures presented in tables and graphs may differ due to rounding. Some items contain revisions todata from previous years.

BNYMSANV AS AGENT/CLIENTS LUX UCITS NON TREATY 1

1,475

2.26

Kaneka Business Partner Shareholding Association

1,220

1.87

Name of Shareholders

Notes: The numbers of Share Units Owned are rounded down to thousands of shares.
The Percentage of Total Shares Issued is calculated by using deducting number of treasury shares from Number of Shares Issued and Outstanding and rounded
to two decimal places.
In addition to the above list, the Company maintains 2,761 thousand shares of treasury stock.

Referenced Guidelines
GRI Standards; Environmental Reporting Guidelines 2012 of the Ministry of the Environment; Environmental Accounting Guidelines 2005 of the Ministry of the Environment

Information Tools
Common Stock Price Range (Tokyo Stock Exchange; Yen)
Years ended
March 31

2018

2019

2020

2021

2022

High

1,114

5,620

4,535

5,000

4,990

Low

815

3,640

2,112

2,406

3,165

Notes: The above figures are stock prices quoted at the Tokyo Stock Exchange (First Section).
Our shares were consolidated on the basis of one new common share for five existing
common shares as of October 1, 2018.

92

Kaneka Integrated Report 2022

The Kaneka Group posts a variety of information
on its official website as a tool for communicatingwith stakeholders.

Financialinformation

	Financial Results and Presentations
	Reports (To Our Shareholders)	Integrated Reporthttps://www.kaneka.co.jp/en/ir/

Non-financial
information

Further details about the Kaneka
Group’s ongoing ESG activities are available
on our website.
ESG activities
https://www.kaneka.co.jp/en/esg/

Kaneka Integrated Report 2022

93