C S R RE PORT 2 021

Revision History
Dec. 23 2021

First Edition

June 01 2022

Revised Second Edition
P.55 The target of reducing CO₂ emissions in FY2030 is updated.
P.56 The target of reducing CO₂ emissions in FY2030 (JFE Steel) is updated.
P.57 CO₂ emission reductions in the steel business in FY 2030 in "JFE Group's Activities for
Carbon Neutrality" are updated.
P.65 The target of reducing CO₂ emissions in FY2030 (steel business) in " Roadmap to Carbon
Neutrality in 2050" is updated.
P.71 The target of reducing CO₂ emissions in FY2030 is updated.

1

Message from the CEO

JFE Group Vision
4
6
12
16

Corporate Vision/Business Conduct
Value of SteelSeventh Medium-term Business Plan
Material Issues of Corporate Management

CSR Management
26
32
46

CSR Structure
JFE Group Value Chain
Supply Chain Management

Environment
49
55
77
90
94
113
117
120
125
129

Environmental Management
Climate Change
Scenario Analysis in Line with the TCFD Recommendations
Steel Industry Initiatives
Development and Provision of Eco-friendly Processes and Products
Efficient Use of Resources
Water Security
Prevention of Pollution
Biodiversity
Environmental Communication

Social
131
138
148
160
166
176

Responsibility to Customers (Provide Quality Products and Enhance
Customer Satisfaction)
Occupational Health and Safety
Labor Standards (Recruit and Nurture Diverse Human Resources)
Human Rights
Community
Shareholders and Investors

Governance
178
189
193
197

Corporate GovernanceCompliance
Risk Management
Tax Transparency

ESG Data
198
220
226
231

Environmental Data
Social Data
Governance Data
Independent Assurance Statement

External Evaluations and Awards
232
236
240

External ESG Evaluations
External Awards
Third-party Comments

243
247

Editorial Policy
Guideline Content IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Message from the CEO

October 2021

Koji Kakigi
Representative Director, President and CEO of JFE Holdings, Inc.

Contributing to the Sustainable Development of Society for a Prosperous
Global Future by Making Maximium Use of Group Resources

Where We Stand and What We Intend to Do
The social and economic environment surrounding the JFE Group is changing at an unprecedented pace in the faceof challenges that include intensifying global competition amid the ascendency of China, an increasingly uncertain
outlook for the global economy caused by the U.S.-China rivalry, the need to address climate change, and the spread of
COVID-19. We must flexibly and effectively adapt to these changes by following our corporate vision of “Contributing
to society with the world’s most innovative technology.” By doing so, we will fulfill our mission of being essential tosociety’s sustainable development and create safe, comfortable lives for people everywhere. We will also be ensuring
environmental and social sustainability (helping to solve critical issues) and establishing economic sustainability (stableearnings power) toward ultimately realizing sustainable growth for the Group over the medium to long term andincreasing corporate value. Meanwhile, every employee will be motivated to do their jobs with a greater sense of
purpose and satisfaction by engaging in the Company’s contributions to sustainable development. The JFE Group will
pursue medium- to long-term management to attain these goals.
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The Seventh Medium-term Business Plan and Material Issues of Corporate Management
JFE formulated the Seventh Medium-term Business Plan, which covers the period from FY2021 to FY2024, to steadilyenhance corporate value over the medium to long term. We consider this target period as the most transformative
period in the Company’s history. We will establish a robust management foundation that can deliver stable profit throughmeasures including the structural reform of the steel business, which we announced last year, and we will proactively
address climate change and other ESG issues.
To date, the JFE Group has identified material CSR issues in its business activities from the perspective of its
diverse stakeholders and has designated key performance indicators (KPIs) to evaluate its initiatives for these issues.
In FY2021, under the policies of the medium-term plan, we have decided to identify and combine our economic issues
with our material CSR issues to formulate and disclose our material issues of corporate management. By appropriately
evaluating and revising these issues and KPIs to pursue activities for achieving our goals, we will build a solid foundation
for sustainable growth for the Company while steadily advancing our initiatives for medium- to long-term environmental
and social issues such as climate change.

Initiatives on Climate Change, and the JFE Group Environmental Vision for 2050
While the use of a blast furnace is the optimal manufacturing process for mass-producing high-quality, high-performancesteel, it is not yet possible to avoid emitting CO2 with this method. Since the steel business constitutes the core of the
JFE Group’s operations, climate change is an extremely important management issue from the perspective of business
continuation. JFE declared its support for the TCFD recommendations in May 2019 and has identified climate changerelated issues based on the scenario analysis advocated in the TCFD to formulate strategies for sustainable growth. In
September 2020, JFE disclosed its target of reducing CO2 emissions in FY2030 by 20% or more compared to FY2013
in the steel business, which accounts for most of the Group’s CO2 emissions. We also declared its intention to achievecarbon neutrality by 2050, ahead of the Japanese government’s announcement of the same goal. In our latest mediumterm plan, we formulated the JFE Group Environmental Vision for 2050, laying out our concrete initiatives for reducing
CO2 emissions. By reflecting the TCFD’s philosophy in our management strategies, we will systematically address
climate change. In the steel business, we will reduce CO2 emissions by 18% from FY2013 levels by the end of FY2024.
By doing so, we will not only achieve our FY2030 target announced in FY2020 but also further promote technologicaldevelopment and disclose a more ambitious action plan in the form of a target for FY2030 during the period covered by
the medium-term business plan. Moreover, we will take on the challenge of developing super-innovative technologies,
such as carbon-recycling blast furnaces developed with our unique techonology, while also adopting a multitrack
approach for pursuing other technologies to explore all possibilities for realizing carbon neutrality in 2050.
Efforts to realize carbon neutrality are gaining momentum around the world. JFE recognizes this trend as a business
opportunity and is seeking to expand its contribution to reducing CO2 emissions across society by leveraging the Group’s
strengths as they are deployed in diverse businesses. We intend to contribute with a reduction of 12 million tons of CO2
in 2024 and 25 million tons in 2030, by expanding renewable power generation under development in the engineeringbusiness. We especially intend to unite our efforts behind the offshore wind-power business by making maximium useof Group resources.

Initiatives for Solving Social Issues and Enhancing Corporate GovernanceI take seriously the fact that we have not been able to achieve our goal of zero major accidents, which is for managing
the safety and health of our employees. We will promote efforts to ensure absolute safety by remodeling our facilities toeliminate accidents through measures such as installing sensors to reduce potential hazards as well as bolstering safety
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Indices

education and stringently complying with prevailing regulations. Also, we will proactively introduce tools for supporting
safety based on advanced IT for monitoring and detection. Under the medium-term plan, we intend to invest around ten
billion yen in safety each year for the entire Group.
To facilitate employee participation, we will actively hire women and mid-career staff to maximize the capabilities
of employees with diverse backgrounds. We will also create safe and rewarding workplace environments and in-housesystem. In particular, we will strive to establish workplaces that enable female employees to pursue their careers
following life events and demonstrate their abilities in mangerial positions, as we accelerate our Group-wide initiatives
to realize a shared vision of our future. We will conduct human rights due diligence across the global supply chain to
steadfastly expand our support in this area. Also, we will advance our initiatives by setting performance targets for non- financial metrics related to environmental and social issues, with a focus on climate change, to enhance our corporate
governance.

Leveraging Group Synergies to Contribute to the Sustainable Growth of Society
JFE will squarely address the rapidly evolving business environment through bold reforms and taking on challenges
by applying the Group’s strengths and synergies to maximum effect. I am confident that this will not only result in oursustainable growth and enhanced corporate value but also contribute to the sustainable development of society as awhole based on our corporate vision of “Contributing to society with the world’s most innovative technology.” To handdown a prosperous global future to the next generation, the entire Group will play its part in realizing the sustainablegrowth of society by making maximum use of group’s resources gained over years to consistently generate values andby delivering products and services that leverage its strengths.

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VisionCSRManagement

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Corporate Vision/Business Conduct
The JFE Group’s corporate values and standards of business conduct
are manifested in the company’s vision of contributing to society withthe world’s most innovative technology. We proactively address criticalissues regarding safety, disaster prevention, product quality, humanrights, compliance, environmental protection and climate change.
The JFE Group considers the perspectives of all stakeholders,
including customers, clients, shareholders, investors, community
residents and employees, guided by a fair, objective and transparent
system of corporate governance. In the spirit of its corporate values of
Challenging Spirit, Flexibility and Sincerity, the JFE Group strives to earnsociety’s trust by undertaking CSR with integrity.

JFE Group Standards of Business Conduct
All JFE Group personnel are required to faithfully adhere to the following Standards of Conduct in all corporate activities.
These standards embody the JFE Group’s Corporate Vision and go hand in hand with its Corporate Values.
Senior managers are responsible for communicating these standards to employees of Group companies and their
supply chain partners, and in creating effective systems and mechanisms to ensure adherence to ethical standards.
Senior managers are also responsible for measures to prevent the recurrence of any violation of these standards.
Additionally, they must report violations promptly and accurately to internal and external stakeholders, determine thepersons of relevant authority and accountability, and resolve matters rigorously.

1 Provide quality products and services
Earn the trust and acclaim of customers by endeavoring to provide safe, high-quality products and services basedon superior technologies, and by fully respecting and protecting the privacy of personal and customer information.
Also, leverage our superior technologies for the sustainable growth of our Group and society.
2 Be open to society
Disclose corporate information actively and engage in constructive dialogues with diverse stakeholders to enhance
our corporate value.
3 Work with communities
Actively contribute to host communities as a good corporate citizen by emphasizing harmony and cooperation.

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JFE Group
VisionCSRManagement

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Evaluations
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Editorial
Policy4 Globalize
Endeavor to achieve understanding with people around the world, working from a global perspective and withrespect to international norms, and also local cultures and customs.
5 Exist harmoniously with the global environment
Actively work to exist harmoniously with the global environment, as well as to raise living standards and advancesocieties.
6 Maintain proper relations with governments and political authorities
Endeavor to build and maintain sound and proper relationships with governments and political authorities.
7 Maintain crisis readiness
Firmly resist all elements and organizations that threaten social order and stability, and refuse all illegal or improper
demands. Also, contribute to order and safety in society by thoroughly and methodically preparing for crises suchas terrorism, cyberattacks, natural disasters and others, including by ensuring the stable availability of products andservices.
8 Respect human rights
Respect all employees and members of the general public as individuals and refrain from any discrimination incorporate activities.
9 Provide challenging work environments
Provide employees with attractive, safe, healthy and challenging work environments.
10 Comply with laws and ordinances
Comply with all applicable laws and ordinances, endeavor to compete fairly and freely, refrain from illegal businessactivities, promote sound business practices, and be faithful and sincere in all activities and dealings.

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IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

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ESG Data

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PolicyGuideline
IndicesValue of SteelAppealing Qualities of Steel that Create Safe, Comfortable Lives for a Prosperous Global Future
Iron makes up approximately 30% of the Earth’s mass. Because of its rich reserves, steel can be mass produced at very
low cost. Compared to other materials, the environmental impact of its production is extremely low and it has excellent
recyclability. Steel can be recycled repeatedly and reborn as various products (closed-loop recycling) with little or noenvironmental impact, contributing to the sustainable growth of our society.

Life Cycle Assessment of Steel
Steel’s excellent recyclability contributes to the creation of a sophisticated value chain encompassing three components:
Produce, Use, and Recycle. Steel products can be repeatedly reborn as various products. It is therefore importantthat the environmental impact of steel be assessed across its entire life cycle, including at the recycling stage. JFE
Steel participates as a key member in an initiative led by the Japan Iron and Steel Federation (JISF) to quantify theenvironmental impact of the entire life cycle of steel products and developed the ISO/JIS standard* calculation
methodology. Corresponding to this standard, materials with higher recyclability are found to have lower environmental
impact such as on global warming.
Fifteen blast furnace and electric furnace steel manufacturers operating in Japan, including JFE Steel, have compiled
and published the national average value for life cycle inventory (LCI) data for different types of steel products for
FY2018.
*ISO 20915: Life cycle inventory calculation methodology for steel products (2018.11)
JIS Q 20915: Life cycle inventory calculation methodology for steel products (2019.6)
Contribution to the Development of Calculation in LCA (P.93)

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SocialGovernance

1.40
1.22 billion
tonnesbillion tonnes
/year

/year

2015

2050

The long-term vision for climate change
mitigation by JISF

Steelworks

Blast
furnace1.62

0.56 1.55
2015

2050

2015

Pig iron production(blast furnace)billion tonnes/year

Editorial
PolicyWorld Steel Use

Rich Reserves of SteelSupport the Developmentof Society
Naturalresources

External
Evaluations
and Awards

ESG Data

Electric
furnacebillion tonnes
/year

2.68

billion tonnes/yearbillion tonnes
/year

2015

2050

2050

Crude steel production

Scrap consumption
Steel Is Repeatedly
Recycled

Converter

Produce
RecycleDisassemble
and collect

Steel Is Repeatedly
Reborn as Various
Products

Processing
and producing
different products
Automobiles andconstruction materials

Use

Steel Is Efficiently Recovered
and Separated Using Magnets

Contributing to the
Sustainable Developmentof Daily Life and theEconomy with the World’s
Top Energy-saving,
Environmental
Technologies

Steel Is Reborn as
Various Products
Cans

Automobiles
Buildings

tonnes29.4 billion
tonnes/＝ 4.0 person

2015

68.2
＝ 7.0

billiontonnestonnes/person2050

Society
Final product/use

1.29

billion tonnes
/year
2015

2.13

billion tonnes
/year
2050

Steel demand

Steel stock volume

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Guideline
IndicesMessage fromthe CEO

JFE Group
VisionProduce

CSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
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Editorial
PolicyHigh Economic Efficiency and Low Environmental Impact

The stable mass production of steel serves as the foundation for daily life and society. CO2 generated by the
manufacturing process of steel is extremely low compared to other materials, making it an environmentallysound material. Steel is an essential for society’s sustainable development and to create safe, comfortable lives
for people everywhere.
Earth, a Planet of Iron (Abundant Resources)
As much as 85% of the Earth’s metal resources are iron ore (180 billion tonnes).
Source: Mineral Commodity Summaries (2021)
Recoverable Reserves of Iron Ore on the Earth

180

about

billiontonnes85%
Mass Production at Low Cost

With rich reserves and a long history of technological development, iron is mass produced at reasonable prices
and supplied stably, thereby contributing to the sustainable growth of society.
Global Demand (2020)

Price*

approx.
billiontonnes30–1001.9

approx.
milliontonnes65

Reasonably
priced!

approx.

tonnes
130 thousand

Steel

Carbon fiber

5–8

1
Aluminum

Steel

Research: JFE Holdings

Carbon fiber

Aluminum

Research: JFE Holdings*Cost of producing one unit weight of ironis indexed at 1 for comparison with othermaterials.

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External
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Editorial
PolicyExtremely Low Environmental Impact at the Manufacturing Stage when Compared to Other Materials
Greenhouse gas (GHG) emissions of steel at the manufacturing stage is approximately one-fourth to one-fifth ofthat of aluminum and carbon fiber with equivalent functionality.
GHG Emissions at the Manufacturing Stage of Materials (CO2 equivalent)

1,106 kg-CO

2990kg-CO2

Low environmental
impact!

230kg-CO

2

CFRP

Steel
(mild steel)

Aluminum

Carbon Fiber
Reinforced Plastic

GHG emissions per unit weight(CO₂ equivalent) (kg-CO₂/kg)

2.3

16.5

22.0

Functional equivalent weight (kg)

100

67

45

Source: Compiled from data disclosed by WorldAutoSteelJapan’s Steel Industry Boasts the Highest Energy Efficiency in the World
Japan’s steel industry (converter steel) produces steel with the lowest environmental impact compared toother major countries. This is a result of its longstanding efforts toward environmental conservation, including
developing and spreading the use of energy-saving technologies.
World’s Quotient, with Japan as 100 (2015)

116 117119 122 123

128 130

140
120

U.S.A.

RussiaIndia

BrazilFrance

U.K.

100

China

South Korea

100 103

109

Germany

No.1 !

Japan

Message fromthe CEO

80

Source: Research Institute of Innovative Technology for the Earth (RITE)JFE GROUP CSR REPORT 2021

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VisionUse

CSRManagement

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External
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Editorial
PolicyFoundation of Daily Life and Society

The use of steel impacts the environment less than other materials. For example, making automobile frameswith high tensile strength steel sheets, which have a reduced thickness but retain their strength, considerably
decreases the weight while maintaining crash performance, thereby helping to reduce CO2 emissions forsociety as a whole.
The Potential to Grow on a Global Scale
Global average of annual consumption of steel is approximately 230 kg per capita. The long-term global demand
for steel is expected to keep growing alongside the economic development of emerging countries.
Trends in Annual Steel Consumption per Capita by Country (kg/person/year)
（kg）

800
600
500
400

China

ThailandIndia

400−500 kg
Worldaverage

1950

1960

Vietnam633
498

approximately

200
0

Japan

Standard in developed
countries

1970

230kg

1980

1990

265
252
75
2000

2010

2019 (Year)

Source: World Steel Association

Potential for Evolution
Steel can be elongated two to three times more than aluminum at the same rigidity and is three to five times
stronger at the same extended rate, making it the optimal material for new world-class structures such as
TOKYO SKYTREE. And yet there is still potential for further evolution. The emerging needs of society will
advance the development of steel and contribute to a productive future.
Comparison of Strength and Elongation between Steel, Aluminum, and Carbon Fiber

Elongation (%)

Message fromthe CEO

60
Elongates

40
20

Steel

2 to 3 times3
to 5 times
stronger

Carbonfibers

Aluminum alloy

0

400

800

1,200

1,600

Tensile strength (MPa)

Research: JFE Holdings

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JFE Group
VisionRecycleCSRManagement

Environment

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ESG Data

External
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Editorial
PolicyExcellent Recyclability

Steel is a highly recyclable material that can be easily recovered and separated using magnets. It can be
efficiently recovered, separated, and recycled into high-quality, high-functioning products over and over again
through closed-loop recycling.

Closed-loop Recycling of Steel
Steel can be recycled a number of times as a raw material for steel products while retaining its original
properties. Closed-loop recycling is superior to open-loop recycling in terms of sustainability, because closedloop recycling reduces the consumption of natural resources, as well as the amount of environmentallyhazardous substances and wastes.
*In open-loop recycling, the material recycling process involves two types of finite recycling which are thermal
recycling and cascade recycling. Thermal recycling means that heat generated by incineration is recovered
while cascade recycling indicates recycling the material accompanied by the degradation or alteration of thematerial’s properties.
Closed-loop Recycling

Magnetic separation
New Products

Recycling rate
for steel products*

93.1%

ScrapsNew SteelSource: The Japan Iron and Steel Federation

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PolicyGuideline
IndicesSeventh Medium-term Business Plan
The JFE Group is in the midst of an unprecedented business environment characterized by rapid and extensive change.
To adapt to these changes and steadily increase corporate value over the medium to long term, JFE formulated its
seventh medium-term business plan running from FY2021 through FY2024. The four years covered by the plan will be
the most transformative period in the Company’s history. Through the plan, we aim to rise to a new level by taking boldsteps to establish a foundation for sustained, long-term growth.

Goals to Achieve for the Seventh Medium-term Business Plan
The long-term goal of JFE is to provide products and services that support the development of a prosperous global future,
which reflects JFE’s corporate vision of contributing to society with the world’s most innovative technology .
JFE’s mission is to establish its position as a company essential to society’s sustainable development and to create
safe, comfortable lives for people everywhere. Ensuring environmental and social sustainability (helping to solve criticalissues) and establishing economic sustainability (stable earnings power) will be crucial to making this happen. Achieving
sustainable growth and increased value for the Group over the medium to long term will in turn enable us to further
contribute to the sustainable development of our society for a prosperous global future.

JFE’s corporate vision:
Contributing to society with the world’s most innovative technology

JFE’s mission

To be essential to society’s sustainable development andto create safe, comfortable lives for people everywhere

Environmental andsocial sustainability

Economic sustainabiity(helping to solve critical issues)(stable earnings power)

Ensuring environmental and social sustainability and establishing economic
sustainability will enable to ensure the resiliency of JFE’s operationalfoundations and allow the company to achieve sustainable growth andincreased valueover the mid/long-term.

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Major Strategies of the Seventh Medium-term Business Plan
Achieve Environmental and Social Sustainability
Formulation and Promotion of the JFE Group Environmental Vision for 2050
Climate change has spawned a sense of crisis that has rapidly spread across the the world, increasing the urgency offinding a solution. The JFE Group has positioned its initiatives on climate change as a top-priority business issue from theperspective of business continuity and formuated the JFE Group Environmental Vision for 2050. We will seek to reduce
CO2 emissions from the steel business by 18% from FY2013 levels by the end of FY2024 and achieve carbon neutrality
by 2050. To meet these goals, JFE will work to combat climate change by developing super-innovative technology forcarbon-recycling blast furnaces*1 and CCU*2, accelerating the commercialization of its offshore wind-power business byapplying the strengths of the Group while further reducing CO2 emissions, with a focus on its engineering business, forall of society.
*1 Carbon-recycling Blast Furnace : A blast furnace operated by applying hydrogen to convert the CO2 generated insteelworks into a carbon-neutral reduction agent (methane) and replacing it with conventional coal-derived reduction
agents.
*2 CCU: Carbon dioxide Capture and Utilization
Seventh Medium-term Business Plan (https://www.jfe-holdings.co.jp/en/investor/management/plan/index.html)
JFE Group Environmental Vision for 2050 (P.56)

Solve Issues Impacting Society
The JFE Group adheres to the philosophy of safety first, and it promotes the development of a safe working environment.
To achieve our top-priority goal of zero accidents, we will bolster safety education and require stringent compliance withrelated rules while also focusing our efforts on eliminating accidents at our facilities. Furthermore, we will secure diverse
human resources required for raising competitiveness and achieving our growth strategies, nurture employees who
serve as the foundation of our business activities, and create workplace environments and internal systems to maximize
the capabilities of our employees.
We will also expand bases for local production and consumption focused on the food-recycling business to contributeto communities through our engineering business. We will seek to realize a circular economy by broadly expanding thesebusinesses.
We will conduct human rights due diligence from FY2021 to strengthen our human rights management across theglobal supply chain.
Seventh Medium-term Business Plan (https://www.jfe-holdings.co.jp/en/investor/management/plan/index.html)
Occupational Health and Safety (P.138)
Labor Standards (Recruit and Nurture Diverse Human Resources) (P.148)
JFE Engineering's Website: 360°JFE Engineering (https://www.jfe-eng.co.jp/en/360_jfe_engineering/)
Human Rights (P.160)

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PolicyGuideline
IndicesEnhancing Corporate Governance
JFE has implemented initiatives such as formulating its Basic Policy on Corporate Governance, establishing theNomination Committee and the Remuneration Committee, introducing a performance-linked remuneration system fordirectors as well as conducting the analysis and evaluation of directors’ effectiveness to enhance corporate governance.
In order to further strenghen the Group’s governance, we will set performance targets for non-financial metrics related
to environmental and social issues and reinforce our Group-wide cross-sectional risk-management system.
Corporate Governance (P.178)

Establish Economic Sustainability (Stable Earnings Power)
The domestic steel market is expected to shrink as Japan’s population declines, while intensifying price competition forcommodity products and the increasing trend of local production of steel for local use suggest that efforts to grow export
volumes are not likely to be profitable. Therefore, we will shift production in Japan toward profitability based on quality
rather than quantity and pursue targets per-ton profit of steel materials as our target. To that end, we will establish a profit
base that is resilient to changes in economic conditions by successfully completing structural reforms. We will introduce
new technologies through digital transformation (DX) to significantly reduce costs, and we will ensure competitivenessby improving quality and delivery, ultimately to achieve world-class cost and quality competitiveness. We will also expand
margins and achieve stable profit by increasing our mix of highly value-added products and fully overhauling our sales
pricing.
In addition, we will steadily promote the growth strategies of each operating company through initiatives
such as considering the establishment of a production and sales joint venture with India’s JSW for (grain-oriented)
electromagnetic steel sheets and expanding the engineering business in the environmental, recycling and renewableenergy fields. To boost competitiveness in these businesses, we will promote DX across all our business domains
focused on the three areas of advancing productivity through innovation, transforming existing businesses, and creating
new businesses.
We will also balance financial soundness with effective investment based on a “select and concentrate” approach.
We selectively extend investments to maintain functions by prioritizing those for raising competitiveness andestablishing a stable foundation for profit and to secure funding by reducing assets and businesses that contribute little toearnings or are tied to unprofitable businesses to reduce our assets. By doing so, we will steadily implement strategies
for achieving our performance and profitability targets, which are: ROE of 10%; 320 billion yen in consolidated businessprofit; and 220 billion yen in profit attributable to owners of parent, by the plan’s final year (FY2024).

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Policy■ Investment and Asset-Downsizing Plans
Seventh medium-term business plan(four-year total)

Content

Consolidated Investment

Equipment Investment

About 1,200 billion yen

Business Investment

About 250 billion yen

Total

About 1,450 billion yen

GX Investment*

About 340 billion yen

DX Investment

About 120 billion yen(Of above)

Asset Downsizing

About 200 billion yen*Investment in green transformation (carbon neutrality)■ Performance and Profitability Targets and Dividend Policy
Seventh medium-term business plan(final year: FY2024)

Performance and profitability targets

Consolidated business profit

320 billion yen/year

Profit attributable to owners of parent

220 billion/year

ROE

10%

Debt/EBITDA

About 3 times

D/E ratio

About 70%

Dividend policy

Seventh medium-term business plan

Payout ratio

About 30%

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PolicyGuideline
IndicesMaterial Issues of Corporate Management
Action on Material Issues
The JFE Group’s actions related to management issues are based on identifying materiality and setting KPIs to minimize
negative societal impact and maximize societal value by investing JFE Group’s resources from the standpoint of meetingstakeholder needs. In 2016, we determined our material CSR issues (13 issues in 5 focus areas)by comprehensively
identifying 35 issues that reflect society’s expectations in the context of JFE’s business and then by prioritizing the issues
through the two criteria of stakeholder expectations and relevance to business (societal impact).
In FY2021, we formulated the Seventh Medium-Term Business Plan, recognizing that ensuring environmental andsocial sustainability (helping to solve critical issues) and establishing economic sustainability (stable earnings power) are
key to the JFE Group’s sustainable development. Accordingly, we reorganized our materiality by adding economic issues
to our existing CSR issues to identify all our material issues of corporate management. We will demonstrate the Group’s
vision of “contributing to society with the world’s most innovative technology” by working in concert to address theseissues.

Process for Identifying Material Issues of Corporate Management
The JFE Group has been promoting actions that address the material CSR issues identified in 2016 (13 issues in 5 focus
areas).
Refer to the following on how we identified material CSR issues up to FY2020.
Material CSR Issues (CSR REPORT 2020) (https://www.jfe-holdings.co.jp/en/csr/pdf/csr_2020e.pdf)
In FY2021, JFE identified its material issues of corporate management through the following process.

STEP 1.

Reassessment of Existing Material CSR Issues

The material CSR issues identified in 2016 were reassessed for their importance in terms of relating to current
operations, stakeholder expectations and achievement of KPIs.

STEP 2.

Setting of Material Economic Issues

Based on discussions at each operating company, major strategies in the Seventh Medium-Term Business Plan weregrouped together with the sources of competitive advantages in the JFE Group’s business model, and economic-related
issues were clarified for the economic sustainability of the Group.
•Source of Competitive Advantage
Steel and Trading Businesses: Production; Sales; and Technological Development
Engineering Business: Engineering, Procurement, and Construction; Sales; and Technological Development
JFE GROUP CSR REPORT 2021

16

Message fromthe CEO

JFE Group
VisionSTEP 3.

CSR
Management

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Selection of 20 Material Issue Candidates

Economic-related issues were added to the list of reassessed CSR issues, and their appropriateness as issues for the
JFE Group was deliberated by the Group Management Strategy Committee, screening out 20 material issue candidates.

20 Candidates for Material Issues• Achieve carbon neutrality by 2050

• Stable supply of products and services• Provide eco-friendly businesses and products• Ensure quality• Protect the global atmosphere• Increase the added value of products and technologies• Pursue resource recycling• Bolster sales capabilities• Prevent workplace accidents• Meet customer needs• Ensure the health of employees and their families• Develop and expand the base of our growth businesses• Pursue diversity and inclusion• Develop cutting-edge technology• Strengthen human resources development• Ensure financial soundness• Implement workstyle reform• Ensure adherence to corporate ethics and compliance• Increase efficiency and enhance cost•R espect the human rights of each person involved incompetitiveness in production and EPC

STEP 4.

our business

Identification of the of the most important 13 Material Issues

The Group Management Strategy Committee and Board of Directors deliberated on the 20 candidate issues, and narrow
them down by identifying the most important 13 material issues for the current JFE Group.

• Reduce the JFE Group’s CO2 emissions• Increase efficiency and enhance cost competitiveness in• Contribute to reduction of CO2 emissions across thesocietyproduction and engineering• R aise quality of products and services and ensure reliable• Prevent workplace accidents

supply• Ensure the health of employees and their families• Pursue diversity and inclusion• E
 xpand business by increasing value added in products
and services with advanced technologies• Strengthen human resources development• Sales strategies for realizing sustainable growth• Create workplaces that motivate employees• Ensure adherence to corporate ethics and compliance• Respect human rights throughout the supply chain

JFE GROUP CSR REPORT 2021

17

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Contribution to the Sustainable Development Goals (SDGs)
In September 2015, a UN Summit adopted 17 SDGs to be addressed through worldwide efforts to achieve sustainable
development. The JFE Group will respond to global community needs and try to contribute to SDGs by our businessactivities and actions for material issues.

Corporate Vision: Contributing to Society with the World’s Most Innovative Technology

Areas of Focus

Scope of
Influence

Details

Contribute to resolving
climate change issues(initiatives for achievingcarbon neutrality by 2050)•Initiatives for achieving carbon neutrality by 2050
・Reduce the JFE Group’s CO2 emissions
・Contribute to reduction of CO2 emissions in society

JFE Group
Local communities
near manufacturing sites
Customers
Society

Ensure occupationalsafety and health•Prioritize safety first•Maintain the physical and mental health of employees andtheir families

JFE Group
Suppliers
Business partners

Recruit and nurture
diverse human resources•Maintain work environments where all personnel can
maximize their abilities•Accumulate and hand down technologies and skills

JFE Group
Business partners

Reinforce resilience of
production andengineering capabilities(realize world-classearnings power throughDX and other measures)•Pursue world-class earnings power•Promote DX and other measures to improve production
efficiency, yields, and labor productivity
・Shift focus of steel business from quantity to quality(structural reform)・Reduce costs to strengthen cost competitiveness andensure quality competitivenessStrengthen
competitiveness of
products and services(promote the growthstrategy by providing highvalue-added solutions)•Improve margins and ensure stable earnings power
・Increase ratio of high value-added products and services
・Ensure stable earnings power based on the sales strategy,
including technological solutions and expansion of
growth businesses

Material Issues

Contribute to reduction of CO2 emissions
across the society
Prevent workplace accidents
Ensure the health of employees andtheir families
Pursue diversity and inclusion

Activity
Basis of activity

Thoroughly enforce compliance
Respect human rights

Strengthen human resources
development
Create workplaces that motivate
employees

JFE Group
Customers
Society

JFE Group
Customers
Society

JFE Group
Suppliers
Political authorities
Society

Increase efficiency and enhance costcompetitiveness in production andengineering
Raise quality of products and services
and ensure reliable supply
Expand business by increasing value
added in products and services withadvanced technologies
Sales strategies for realizing sustainablegrowthEnsure adherence to corporate ethicalstandards and compliance
Respect human rights across the supply
chain

Corporate Governance (Ensure Fairness, Objectivity and Transparency)
Respect and Maintain Awareness of Human Rights

JFE GROUP CSR REPORT 2021

18

Relevant SDGs

Reduce the JFE Group’s CO2 emissions

Increased
corporate value
and sustainablegrowthGoals

Contribute torealizingsustainable
societies

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

KPIs for Material Issues
FY2020 KPI Results and Evaluation
The JFE Group established KPIs to address the CSR issues identified in FY2016. It tackles these KPIs by focusing thepower of the entire Group. In FY2020, the Group assessed the previous year’s KPI results. Assessment results, together
with opinions exchanged with stakeholders, were used to further review the KPIs and address each issue.

FY2020 KPI Results (P.20)

FY2021 KPIs for Material Issues of Corporate Management
KPIs for material issues of corporate management identified in FY2021 were determined following consideration by each
operating company, discussions by the Management Committee, and deliberation by the Group Management Strategy
Committee and Board of Directors.
FY2021 KPIs for Material Issues of Corporate Management (P.23)

Enhancing ROE by Achieving the KPIs
The KPIs for each material issue are closely tied to the financial targets. Achieving the KPIs for each issue affects various
drivers of improvement, leading to the achievement of the financial target (10% or higher ROE) and results in increasing
corporate value over the medium to long term. The connection between these initiatives for material issues and financial
targets is deeply shared at operating companies and on the front lines, increasing the effectiveness of these initiatives.

■ Connection between KPI-related Elements and Financial Targets
KPI-related elements• Expansion of growth business• Expansion of solutions business• Increase in ratio of high value-added
products and profitability• Research and development in new
products and technologies• Improvement of production efficiency and yields• Improvement of labor productivity• Advances in technological development with DX

Improvement drivers
Sales revenue growth rate

Manufacturing cost rate

ROIC

• Improvement of labor productivity• Increase in production andengineering efficiency, improvement ofcost competitiveness

SGA rate• Reduction of inventory based on higher
production efficiency and yields

Working capital turnover rate

• Reduction of fixed costs based on
structural reform• Improvement of production efficiency

Operating profit margin

ROE

10% or higher

Invested capital turnover rate
Fixed asset turnover rate
Optimal capital structure

JFE GROUP CSR REPORT 2021

19

Activity

Provide quality products(customer satisfaction)

Working toward the target but
short of successWorking toward the target;
partial success achieved

JFE GROUP CSR REPORT 2021

20
N

• Ratio of R&D expenses for the three priority fields: 36%
Total costs in FY2020 R&D: 4.07 billion yen, including 1.48 billion yen for three priority fields

Note: Missed numerical target in FY2020 due to slowdown in economic activity associated with COVID-19
Achieved the target for cumulative total cases encompassing the Fifth and Sixth Medium-TermBusiness Plans(2) Developed new products and technologies
FY2020: 13 cases (3 new products, 10 new technologies) (total from FY2015 to FY2020: 152cases)(1) Pursued strategic research and development
JDXC opened in July 2020, applied AI to blast furnaces, applied DS to three sintering plants inFukuyama, and finished application of J-dscom to all hot strip lines• Began considering quality audits by remote due to the difficulty of conducting on-site audits under
COVID-19; determined procedures and methods based on preliminary check sheets and remote
conferences in January 2021
• Completed quality audits for all 17 domestic Group companies (including remote audits for six
companies)

○

△

〇

○

External
Evaluations
and Awards• Pursue technological development in three critical areas: leveraging ICT, climate change, andrecycling plastics
Numerical target:
Ratio of R&D expenses for the three critical areas: 30% or more

(2) Develop new products and technologies
FY2020: 20 cases or more (achieve the cumulative total of 135 cases from FY2015 to FY2020)*1: Data Science*2: JFE Digital Transformation Center*3: JFE Detecting-anomaly-Signs & Color-Mapping system(1) Pursue strategic research and development▶By developing DS*1 application technology, in FY2020 aim to inaugurate the JFE Digital
Transformation Center (JDXC*2), promote an AI application at blast furnaces, promote a DS
application at three sintering plants in Fukuyama, and apply J-dscom*3 to all hot strip lines• Conduct quality audits at Group companies and continue conducting quality audits at 32 Group
companies in Japan and overseas (expanded target companies from 30 to 32)○• Make steady progress on capital investments to improve the level of quality assurance and producttesting, and achieve full automation of the four critical items: tensile test, molten steel analysis,
steel sheet thickness measurement, and coating weight measurement• Major quality problems: None (examples: legal violations, failure to fulfill customer requirements)○• Steadily invest in automation to finish all approved investments during FY2020 for reaching 100%
automation of four priority areas from test measurements to mill sheet description (Automationachievement rate tensile test: 93.9%, molten steel analysis: 99.9%, automobile steel sheet
thickness measurement: 98.7%, and coating weight measurement: 99.9%)• Make consistent investment in processing and distribution operations• No major quality problems○• Carried out selective investments necessary for this fiscal year to ensure stable product supply
under COVID-19
Amount of investment (approved amount):▶Reinforcement: 7.3 billion yen▶Renewal and safety: 2.7 billion yen▶System: 0.6 billion yen

ESG Data

E

T

N

E

S

T

S

H

H

S

○

• Stable number of managing engineers was secured while achieving high sales revenue

Governance

S

N

E• Secure a stable number of certificated managing engineers○(1) Flexibly respond to changes in demand arising from environmental changes and maintain stable
operations to ensure stable product supply(2) Make steady progress on strengthening the manufacturing base, including measures to stabilize
blast furnace operation

S
T

Assessment

Initiatives and Results for FY2020• Improved facility operations at each steelwork and district by steady progress in strengthening the
manufacturing infrastructures• Flexible operation of blast furnaces to match changes in demand during COVID-19 (introduction of
CPS to blast furnace operations)• Maintained previous fiscal year’s delivery achievement rate in FY2020, despite sharp swings indemandTargets/KPIs

OperatingCompany

SocialPursueresearch anddevelopment

Working toward the target, but
short of success (less than 80%
after linear interpolation)

Working toward achieving thefinal target; partial successachieved (80% or more after linear
interpolation)

Environment

Ensure quality

Less than 80%

At least 80%

CSR
Management

Stable supply of
products

Material CSR
IssuesTarget is achieved

Final target of 100% is achieved

Medium- to long-termtarget (when target is to beachieved in the next several
years)
Qualitative

100% achievement

Single-year target

Note: For targets or KPIs set to assess the Group as a whole, the overall will be that of the operating company that showed the lowest performance.

Quantitative

Target Attribute

Assessment Standards

JFE Group
VisionAreas of Focus

FY2020 KPI Results

Message fromthe CEO
Editorial
PolicyGuideline
IndicesProtect the global environment21

JFE GROUP CSR REPORT 2021
T

N

H

S

E

S

〇

×

(2) 99.1%• Contributed to the expansion of a recycling-oriented society by steadily increasing scrap
transactions since FY2017• Domestic transactions volume decreased in FY2020 to levels lower than in FY2017 due to
COVID-19, failing to meet the target (−1.7% from FY2017)(2) Recycle at least 98.0% of recyclable wastes generated at the Yokohama head office• Global recycling of steel scrap: Increase scrap transactions to exceed the volume for FY2017(FY2020 target: +3% from FY2017)△(1) Recycling rates▶Rubble: 99.4%▶Sludge: 98.9%▶Industrial waste: 85.4%(1) Recycling rate at construction sites▶Recycle at least 99.5% of rubble▶Recycle at least 95.0% of sludge▶Recycle at least 85.0% of industrial waste〇〇(1) Recirculated water usage rate: 93.0%(2) Recycling rate of co-products: 99.7%

Note: The amount in parenthesis represents the value equivalent to the total volume restriction• Successfully maintained low emissions as it was significantly less than the value equivalent to thetotal annual volume restriction:
NOx: 124 Nm³ (18,000 Nm³)
SOx: 42 Nm³ (100 Nm³)〇〇

(1) Maintain the efficient use of water Recirculated water usage rate: 90% or more
(2) Recycling rate of co-products: 99% or more

• Continue work on keeping NOx and SOx emissions at low levels(1) Continued work on keeping NOx and SOx emissions at low levels(2) VOC emissions: 66% decrease(3) Benzene emissions: 94% decrease(4) Dichloromethane emissions: 71% decrease(1) Delivered two biomass power generation plants and two large-scale solar power generation
plants(2) Achieved 16% reduction (FY2019: 16,800 t/year, FY2020: 14,100 t/year)〇

ESG Data

Pursue resource
recyclingN(1) Continue work on keeping NOx and SOx emissions at low levels(2) VOC emissions: maintain a low level (30% decrease compared to FY2000)(3) Benzene emissions: maintain a low level (80% decrease compared to FY1999)(4) Dichloromethane emissions: maintain a low level (40% decrease compared to FY1999)(1) Two or more offerings per year of products/services that contribute to climate change mitigation▶Promote waste-fueled power generation▶Promote biomass power generation▶Promote a digestion gas power generation plant▶Promote geothermal, solar photovoltaic, and wind power generation(2) At least 1% y-o-y reduction of carbon footprint of factories and offices• Disclosed the FY2030 target for reducing CO2 emissions by at least 20% from FY2013 level• Project team launched for CO2 reduction and formulated a scenario for achieving carbon neutrality• Participated in the NEDO technological development project for making zero-carbon steel a reality• Began verification tests at the ferro-coke production pilot plant (NEDO project)• Aim to reduce our CO2 emissions by at least 20% in FY2030 from FY2013 level• Establish project team and formulate and implement a scenario by the end of FY2020 to realize theabove• Participate in technological development led by the New Energy and Industrial Technology
Development Organization (NEDO) to realize zero-carbon steel; develop a long-term road map in2020 to 2021 for technological development• Begin actual operation testing with a ferro-coke pilot plant〇△

Governance

E

T

N

T

• Implemented 3 cases of new business and business expansion▶Established a Bottle-to-Bottle joint venture (Kyoei J&T Recycling)▶Launched a joint venture with three companies for biogas power generation from food waste(Tohoku Biofood Recycling)▶Inherited the refuse-derived fuel (RDF) gasifying power generation business (Omuta Recycle
Electric Generation)• Create new business or products that contribute to environmental protection or expand business:at least one applicable case per year
▶Promote plastic recycling business▶Promote food waste recycling business▶Promote home electronic appliance and fluorescent light recycling business▶Promote renewable energy-generated power supply business▶Develop and offer eco-friendly products

Note: Missed numerical target in FY2020 due to slowdown in economic activity associated with COVID-19
Achieved the target for cumulative total cases encompassing the Fifth and Sixth Medium-TermBusiness Plans• FY2020: 10 cases (2 new products, 8 new technologies) (total from FY2015 to FY2018: 107 cases)• Fully achieved the target of human resource development through skill training; skill training: 4
courses, 125 participants• Invest in the development of strong sales personnel
All target employees are required to meet the goal of human resource development through skill
training and participation of overseas employees in joint training held in Japan• Expand eco-friendly products and technological offerings: 15 or more in FY2020 (target
accumulated total of 105 for the period from FY2015 to FY2020)○• Collected construction completion evaluation forms for public-sector projects and customer
surveys about quality management system (QMS) for private-sector projects (total: 322 projects)• Conveyed customer feedback to sector heads, divisions managers, and others• Use data collected from customer surveys to enhance customer satisfaction○○

Assessment(1) All office heads, managers, and newly appointed employees took the course within two years(2) Implemented feedback on CS survey results

Initiatives and Results for FY2020

SocialS

E

S

Targets/KPIs(1) All sales personnel are to take rank-based training for the sales department within two years of
being posted to the department(2) Conduct CS survey and ensure feedback of results

Environment

Protect
the global
atmosphere

Mitigate climatechange

T

S

N

H

S

E

N

T

E

S

OperatingCompany

CSR
Management

Developand provide
ecofriendly
products

Respond to
customer needs

Material CSR
IssuesJFE Group
VisionActivity

Provide quality products(customer satisfaction)

Areas of Focus

Message fromthe CEO
External
Evaluations
and Awards
Editorial
PolicyGuideline
IndicesBasis ofactivity22

JFE GROUP CSR REPORT 2021
GroupwideGroupwide

Ensureadherence
to corporate
ethicalstandards andcompliance△• Females in managerial positions: 3.6 times the 2014 August figure• Training hours per person
ST 38.5 hours per year
EN 19.0 hours per year
SH 17.5 hours per year
• Rate of attendance for human rights awareness training: 100%

• Steadily executed training to foster and maintain a sense of compliance (100% achievement)• Females in managerial positions: five times the 2014 August figure by 2025
• Training hours per person
ST Over 40 each year
EN Over 20 each year
SH Over 20 each year
• 100% attendance from the target audience for human rights awareness training• Steady execution of training to foster and maintain a sense of compliance (100% achievement)

—

〇

〇

External
Evaluations
and Awards• Improved employee awareness of ethics reflected in the Corporate Ethics Awareness Survey (nextsurvey is scheduled in FY2022)△• Ratios for female recruits
ST Career-track (white-collar position): 28%
Career-track (technical position): 7%
On-site position: 7%
EN Career-track (white-collar position): 18%
Production/construction position (technical): 0%
SH Career-track (white-collar position): 26.7%• Ratios for female recruits
ST Career-track (white-collar position): 35% or more
Career-track (technical position): 10% or more
On-site position: 10% or more
EN Career-track (white-collar position): 20% or more
Production/construction position (technical): 5% or more
SH Career-track (white-collar position): 25% or more

ESG Data• Improve employee awareness of ethics reflected in the Corporate Ethics Awareness Survey△• Rate of health examination for spouses:
ST 48.0%
EN 47.2%
SH 53.2%• Rate of health examination for spouses: 60% (by FY2020)

×△Governance

Strengthen
human
resourcesdevelopment

Groupwide

Pursue diversity
and inclusion

Continued “100% adherence activities”
Promoted fixed-point patrols (patrols for closely observing and understanding tasks) andeliminated tasks unknown to managers and supervisors

Note: Installations to be completed by end of November 2021
▶

▶

×

Assessment

SocialThoroughly enforce
compliance

Recruit and nurture diverse
human resourcesGroupwide

Ensure thehealth ofemployees andtheir families

Groupwide• Provision rates of health guidance:
ST 53.0%
EN 39.1%
SH 41.6%(1) Workplace fatalities: zero occurrences(2) ST Lost-work injuries rate for ST: up to 0.10
Key measures:(1) Strengthen safety activities at each business unit to cover weak areas(2) Restructure the safety and health management system (introduce ISO)(3) Implement safety activities that utilize ICT (specific initiatives: introduce safety monitoring
system, support for safe work using AI image analysis, etc.)
EN Lost-work injuries rate for EN: up to 0.25
Key measures:(1) Build a floor or hand rail for work in high places and wear safety belt
(2) Restrict people from areas near hoisted objects or heavy machinery in operation(3) Turn off equipment, machines, and tools when not in use(4) Verbal communication on safety awareness during site patrol and implementing corrective
measures
Example of advanced initiative:▶Safety training by experiencing dangerous situations using VR and special vehicles designed to
instill an understanding of the sense of safety
SH
Key measures:▶Improve equipment (promoting installation of safety sensors, etc.) to prevent contact between
people and objects in motion

Initiatives and Results for FY2020(1) Workplace fatalities: 1 occurrence(2) ST Lost-work injuries rate: 0.23
Key measures:(1) Lost work injuries rate: Improved from 0.28 in the first half to 0.18 in the latter half(2) Restructure the safety and health management system: started implementing the system inall districts(3) Safety monitoring system: Completed companywide deployment (users: about 2,400)
EN Lost-work injury rate: 0.35
Key measures:(1) Prioritized the following actions to prevent workplace fatalities▶Installed working platforms / handrails and ensured wearing safety belts for work in highplaces▶Ensured people remained at a safe distance from hoisted objects and heavy machinery inoperation▶Turn off equipment, machines, and tools while non-standard operations(2) Made a focused effort on verbal communication during site patrols and implemented
corrective measures to prevent unsafe behavior by relevant employees(3) Promoted safety training based on a simulated experience of accidents using special vehicles
and VR to increase the sensitivity for safety
SH
Key measures:▶Installation of safety sensors
81% of the installations by the end of FY2020

Environment• Provision rates of health guidance:
ST 60% (by FY2023)
EN 35% (by FY2020)
SH 40% (by FY2020)

Targets/KPIs

OperatingCompany

CSR
Management

Activity

Prevent
workplace
accidents

Material CSR
IssuesJFE Group
VisionEnsure occupational safety
and health

Areas of Focus

Message fromthe CEO
Editorial
PolicyGuideline
Indices• Reduce CO2 emissions through the procurement of electricity derived from renewable energy (reduce domestic CO2 emissions by at least 20% from FY2019 levels by the end of
FY2024)HS(1) Global resource recycling of steel scrap• Promote steel scrap transactions to exceed the volume for FY2020 (FY2024 target: +5% from FY2020)(2) Increase transaction quantity of fuel for biomass power generation plants and create framework for reliable supply of fuel• Expand transactions of biomass fuel (palm kernel shells and wood pellets) above FY2020 levels (FY2024 target: +100% increase from FY2020)• Diversify supply sources to ensure stable supply

H

23

JFE GROUP CSR REPORT 2021
N

HS

ESG Data

Key measures:(1) Install safety sensors (100% of plan)(2) 100% implementation of crane operation drills (at least once a year at each company)

GovernanceE

Key measures:(1) Eliminate falling accidents (100% implementation of following measures)▶Pre-operation checks (curing openings in high locations and edges of work floors)▶Strict adherence during operations (use of safety belts)(2) Eliminate accidents involving being caught in heavy machinery or struck by flying/falling objects (100% implementation of following measures)▶Pre-operation checks (ensure on-site understanding of work plans)▶Strict adherence during operations (no entry measures, allocation of worksite guides)(3) Turn off equipment, machines, and tools while non-standard operations(4) Multifaceted management of occupational safety and health▶Conduct remote safety patrols on premises by integrating multiple video images▶Introduce an AI-based system for detecting intruders

Key measures:(1) Enhance safety
Install electromagnetic locks at the secondary mill entrances: 100% by FY2024(2) Restructure the safety and health management system
ISO 45001 certification in all districts: 100% by FY2022

Groupwide

S

SocialT

Workplace fatalities: Zero occurrences• Lost-work injuries rate
ST below 0.10
EN below 0.25
SH below 0.45

S

• Provide renewable energy power generation facilities• Help reduce CO2 emissions in society by expanding the bases of the recycling business (for plastic, food, etc.)
Contribute to reduction in CO2 emissions (FY2021): 10 million tonnes per year

N

E

*Products and technologies that contribute to saving energy and resources, reduce waste and environmentally hazardous substances, and do not require hazardous substances for manufacturing
or useTS• Launch sales and implement eco-friendly products and technologies*: at least 15 cases in FY2021 (the cumulative total of at least 60 cases for the period from FY2021 to FY2024)• Reduce CO2 emissions in its own plants and offices
FY2024: 40% reduction from FY2013 levels

N

E

S

• Formulate an investment plan for CO2 reduction using new benchmarks for steadily achieving the target of reducing CO2 emissions by 18% from FY2013 levels by the end of
FY2024• Achieve 35% of its CO2 reduction target by energy conservation and technological development in FY2021• Create a structure for promoting technological development with a focus on carbon recycling blast furnaces toward achieving carbon neutrality by 2050

KPIs

T

OperatingCompany

Environment

Prevent workplace
accidents

Contribute to reduction of CO2
emissions across the society

Reduce the JFE Group’s CO2
emissions

Material Issues

CSR
Management

Ensure occupational safety andhealthContribute to resolving climatechange issues (initiatives forachieving carbon neutrality by 2050)

Areas of Focus

JFE Group
VisionActivity

KPIs for FY2021

Message fromthe CEO
External
Evaluations
and Awards
Editorial
PolicyGuideline
Indices

Activity

Reinforce resilience of productionand engineering capabilities (realize
world-class earnings power throughDX and other measures)

24

JFE GROUP CSR REPORT 2021
N

H

S

*Proprietary data analysis platform using AI(1) Make consistent investment in processing and distribution operations(2) Conduct quality audits at Group companies• Continue conducting quality audits at 32 Group manufacturing affiliate companies in Japan and overseas (audit completed: 100%)(1) Secure a stable number of certificated managing engineers(2) No major quality problems*Cyber-Physical System(1) Make steady progress on capital investments to improve the level of quality assurance and product testing, and achieve 100% automation from test measurement
to mill sheet data entry for the four priority items: tensile test, molten steel analysis, thickness measurement for hot and cold rolled steel sheets, and coating weightmeasurement
In addition, achieve 100% automation from test instructions, sample collation to test measurement and mill sheet data entry(2) Strengthen the manufacturing infrastructures using DX
Aim to apply to equipment listed below in FY2021 to implement CPS* in all production processes by the end of FY2024
Kurashiki’s new continuous casting DS operations, hot rolling CPS (temperature model/Kurashiki), cold rolling CPS (automatic operation/Kurashiki) and integrated quality
CPS (galvanizing/Fukuyama)

ESG Data

E

T

N

E

*Data Science• Increase the efficiency of engineering operations by introducing DX technologies
1,200 engineers for big data analysis utilizing Pla'cello*

Governance

S

T

S

SocialRaise quality of products andservices and ensure reliablesupplyIncrease efficiency and enhancecost competitiveness in
production and engineering(1) Improve labor productivity by 20% by the end of FY2024
FY2021 KPI:
• Establish investment plans for automation, remote operation and robotics with a focus on DX• Set milestones for investment and number of personnel for each fiscal year
• Plan and systemize concrete labor policies to smoothly facilitate structural reform of the Keihin district(2) Achieve stable quality and enhance yields through measures including introduction of quality prediction technology based on integrated data encompassing the entire
process from steelmaking to final processing using DS*
Improve yields by 0.5% in FY2021 to achieve 2% by FY2024• Engagement survey
Affirmative response to questions about motivation: 75%

Groupwide

T

Groupwide: Annual leave acquisition rate of at least 75% (total for operating companies)

Groupwide

Create workplaces that motivate
employees

EnvironmentS• Training hours per person
ST 40 hours or more per year
EN 20 hours or more per year
SH 20 hours or more per year

Groupwide

Pursue diversity and inclusion

CSR
Management

Strengthen
human resources development(1) Rates for female recruits
ST Career-track (white-collar position): 35% or more
Career-track (technical position): 10% or more
On-site position: 10% or more
EN Career-track (white-collar position): 35% or more
Career-track (technical position): 10% or more
Production/construction position: 10% or more (four-year average)
SH Career-track position: 30% or more
(2) Females in managerial positions: 5 times the 2014 August figure (FY2025 target)(3) Rate of male employees taking childcare leave or time off related to child rearing: at least 90%

KPIs(1) Provision rates of healthcare guidanceGroupwide: 60% (FY2023 target)(2) Reduce rates of smokers (ensure employee health and prevent exposure to passive smoke)Groupwide: 1.5% reduction per year (total for operating companies)

OperatingCompany
Groupwide

Ensure the health of employees
and their families

Material Issues

JFE Group
VisionRecruit and nurture diverse humanresources

Ensure occupational safety andhealthAreas of Focus

Message fromthe CEO
External
Evaluations
and Awards
Editorial
PolicyGuideline
IndicesHS25(1) 100% attendance from the target audience for human rights awareness training(2) Implement human rights due diligence(1) Steady execution of training to foster and maintain a sense of compliance (100% attendance from the target audience)(2) Improve employee awareness of ethics reflected in the Corporate Ethics Awareness Survey (next survey is scheduled for FY2022)

Increase competitiveness of products and services by improving value added in supply chain management through business expansion• Make investments to improve value added in supply chain: at least 5 per year

N

E

SocialRespect human rights across the
supply chain

Ensure adherence to corporate
ethical standards and compliance

Expand the stable earnings base
Expand the operating businesses(1) Sales: 250 billion yen(2) Expand bases: at least 3 bases• Recycling business (food, plastics, electronic appliances, etc.)• Regional electricity retail new power business• Waste processing business• Water and sewage operations business

T

Environment

Respect human rights

Thoroughly enforce compliance

Sales strategies for realizing
sustainable growth• Expand the earnings difference between high value-added products (A-rank products) and commodity products to 5,000 yen per tonnes by FY2024
FY2021 KPI:
Aim for 25% of target

N

E

S

(1) Develop technologies in four priority fields of waste to resources, carbon-neutrality, combined utility service and DX, and at least 60% of R&D expenses on these four fields(2) Number of patent applications: at least 80 per year

T

S

KPIs
(1) Pursue strategic research and development focusing on priority development fields*
Develop new products and technologies
FY2021: at least 20 cases (at least 80 cases in total from FY2021 to FY2024)*Automobiles, energy, infrastructure construction materials, DX technology, and green transformation (GX) technology(2) Increase the mix of high value-added products* to 50% in FY2024 (sell 10.9 million tonnes, 50% of sales excluding half-finished products, by FY2024)
FY2021 KPI:
9.3 million tonnes in sales of high value-added products (up 1.5 million tonnes from FY2020)*Products that offer technological advantages and are recognized by customers for their added value while having greater earnings power than commodity products(3) As a step toward triple earnings in the solution business by FY2024 from the FY2020 level, focus efforts on receiving orders for the new solutions business model (utilization ofDS, provision of maintenance technologies, etc.) and secure first order. With an eye on receiving continuous orders thereafter, update external sales platform and maintenanceknow-howOperatingCompany

CSR
Management

Basis of activity

Activity

Expand business by increasing
value added in products
and services with advanced
technologies

Material Issues

JFE Group
VisionStrengthen competitiveness of
products and services (promote thegrowth strategy by providing highvalue-added solutions)

Areas of Focus

Message fromthe CEO
GovernanceGroupwide

JFE GROUP CSR REPORT 2021

ESG Data
External
Evaluations
and Awards
Editorial
PolicyGuideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCSR Structure
JFR Group CSR System
The JFE Group realizes corporate responsibility by understanding itself as part of the society and considers corporatesocial responsibility (CSR) to be the foundation of its business as it contributes to the realization of a better society.

Supervision over CSR Initiatives
The Group established the JFE Group CSR Council, chaired by the president of JFE Holdings and comprised of theexecutive vice president (director), corporate officers, full-time Audit & Supervisory Board members, the presidents ofoperating companies, and other members to oversee and direct the CSR initiatives of the entire organization, including
risk management, from the perspective of preventing damage to the JFE Group’s corporate value and enhancing it.
Independent, cross-Group committees have been established under the council, including the JFE Group Compliance
Committee, JFE Group Environmental Committee, JFE Group Internal Control Committee, JFE Group Information
Security Committee, Public Disclosure Committee, and Corporate Value Enhancement Committee. Overseeing anddirecting the Group’s CSR initiatives, these committees deliberate on Group policies, monitor how they are being instilled
across the Group, and share information on the tasks at hand as well as on issues that have materialized and relevant
responses. Included in the agenda discussed by the JFE Group CSR Council, the Group’s basic policies, action plans,content of key initiatives and response to critical circumstances are reported regularly to the Board of Directors, which
deliberates on the issues and provides the council with direction and supervision.

JFE Group CSR Council Activities
The Group CSR Council meets approximately once every three months to discuss wide-ranging issues such as theantimonopoly act, compliance with laws and regulations to prevent corruption such as bribery involving public servantsand other officials, human resources, labor issues, safety, disaster prevention, the environment, climate change, quality,
financial reports, addressing antisocial forces, risk management including information security and other ESG-relatedrisks, and social contribution. The council deliberates on policies related to Group initiatives, which also include providing
instruction and guidance on material issues, monitors the penetration of the policies, and shares information on andcarries out horizontal communication regarding our responses to issues and problems.

Cooperation with Operating Companies
The operating companies have also set up respective entities, which operate in collaboration with the JFE GroupCSR Council to promote Group-wide CSR initiatives from the perspective of preventing damage to the JFE Group’s
corporate value and enhancing that value. JFE Steel established the CSR Council chaired by the president in July 2005,
following the establishment of the CSR Section in April 2005. Specific committees and sub-committees in areas suchas compliance, global environment, risk management, safety and disaster prevention, customer satisfaction, social
contributions, etc., established under the CSR Council have been actively conducting the activities in each area, while
promoting CSR awareness together with the Group companies. JFE Engineering and JFE Shoji also lead in the promotionof CSR through the establishment of committees in areas such as compliance and the environment.

JFE GROUP CSR REPORT 2021

26

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ CSR Structure

Board of Directors

Topics Addressed at the Board Meeting
Direction andsupervision

The Groups’s management principles,risk management, responsibility to
stakeholders and society, and otherinitiatives related to the Company’s
basic approach

Report

JFE Group CSR Council—Status of Initiatives and Action Policies Discussed• Initiatives addressing CSR and ESG issues• Setting KPIs for material CSR issues; status of initiatives addressing
the KPIs• Initiatives for climate change• Results of employee awareness survey and future initiatives• Safety activities at each operating company• Operational status of the whistleblowing system• Publishing CSR and integrated reports

Chairperson: President of JFE Holdings
Members:

Executive vice presidents,
corporate officers, full-time Audit& Supervisory Board members,
respective presidents ofoperating companies, etc.

JFE Group Compliance Committee

JFE Group Internal Control Committee
JFE Group Information Security Committee

CSR Promotiong Conference (Chaired by the President)
Environmental Committee

Internal Audits Committee

CSR Awareness Committee

Personnel/Labor Affairs
Committee

Social Contributions Committee

Compliance Committee

Safety & Disaster Prevention
Committee

CS (customer satisfaction)
Committee

Risk Management Committee

Establishing and Circulating
Rules Committee

Public Disclosure Committee

JFE Engineering CSR System

Corporate Value Enhancement Committee
Compliance Committee

Occupational Safety andHeath Committee

Environmental Committee

Disaster Prevention Committee

IssuesCompliance, the environment, climatechange, internal controls, human resources,
labor issues, safety and disaster prevention,social contribution, information security,
ESG-related risk, damage prevention andenhancement of corporate value, etc.

JFE Shoji CSR Council
CSR Promotiong Conference (Chaired by the President)
Environmental Management
Committee

Compliance Committee

Internal Controls Committee

Information Management
Committee

Quality Assurance Committee❷ Monitoring penetration of policies within
the Group

Safety and Industrial Safety
Committee
Disaster Prevention Committee

Social Contribution Committee❸ Information sharing and horizontal
communication regarding responses toissues and problems

Labor-related Legal andEnvironmental Committee

Social Awareness Survey
Committee❶ Group-wide deliberation of policies and actionplans concerning CSR (including instructions
and guidance on important issues)

Affiliates under operating companies or other Group companies

JFE Group Environmental Committee

JFE Steel CSR Council

Confirmation and Improvement through the Employee Awareness Survey
The JFE Group conducts a Corporate Ethics Awareness Survey on a regular basis(once every three years) for directors
and employees of the Company as well as the operating companies to confirm the penetration and thorough complianceof the Group’s Corporate Vision, Corporate Values, and Standards of Business Conduct, along with the identification ofpotential risks. The survey conducted in FY2019 confirmed that many employees acknowledged the vision and corporate
policy and are aware of compliance matters when carrying out their work. On the other hand, the survey also brought toour attention issues to address going forward. These are reflected in the specific initiatives of each Group company under
the supervision of the JFE Group CSR Council and Board of Directors.

JFE GROUP CSR REPORT 2021

27

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCSR Audit
To ensure that CSR activities are conducted properly, the JFE Group systematically audits environmental management,
Antimonopoly Law compliance, expense management, overseas office management, tax law compliance, safety
management, and disaster prevention. If an audit reveals a problem, the internal audit departments of JFE Holdings
and relevant operating companies share information to support the implementation of corrective measures in their CSR
activity.

Initiatives and Relevant SDGs
The JFE Group is taking action to address CSR issues, even in non-material areas.
The following chart summarizes all activities introduced in this report. Through these activities, the JFE Group intends
to contribute to the achievement of the SDGs.
Activities

Related SDGs

CSR Management
Supply Chain
Management(P.46)• romoting Green Procurement• Procurement Policy and Initiatives for
Each Business

Addressing ESG Issues
Environmental
Management(P.49)

Climate Change(P.55)

Development
and Provisionof Eco-friendly
Processes andProducts (P.94)
Efficient Use of
Resources(P.113)

Water Security(P.117)

Prevention of
Pollution(P.120)• Promotion of Environmental
Management System• Environmental Education• Reduction of CO2 in the Steel Business• Greater Contribution to Reducing CO2
in Society as a Whole• Scenario Analysis Based on TCFD
Recommendations• Major Eco-friendly Products andTechnologies in Each Business• Reducing Generation and Emission of
Co-products and Re-using Co-products• Promoting Recycling• Resource Recycling Solution• Addressing Water-related Risks• Efficient Use of Water• Controlling Air Emissions• Preventing Water Pollution• Management of Chemical Substances
and Reduction of Emissions
JFE GROUP CSR REPORT 2021

28

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Activities

Biodiversity(P.125)

Environmental
Communication• Biodiversity Initiatives• Commitments to External Initiatives• Products and Technologies to Preserve
Biodiversity(P.129)R
 esponsibility
to Customers(Provide Quality
Products andEnhance Customer
Satisfaction)• Quality Initiatives• Quality Improvement and Enforcementof Quality Assurance Systems• Improving Customer Satisfaction• Responsible Export Practices(P.131)(P.138)L abor Standards(Recruit andNurture Diverse
Human Resources)(P.148)

Human Rights(P.160)Community(P.166)

Shareholders andInvestors• Occupational Health and Safety• Employee Health• Workstyle Reform• Operational Reform• Workforce Diversity Promotion• Developing Dynamic Work
Environments• Respecting Human Rights Initiatives• Human Rights Due Diligence• Local activities• Support for External Organizations• Support for Youth Development• JFE 21st Century Foundation• Proactive Information Disclosure(P.176)

Compliance(P.189)Tax Transparency(P.197)External
Evaluations
and Awards

Related SDGs

• Disclosing Environmental Data for
Business Sites• Disclosure and Exchange of Information

Occupational
Health and Safety

ESG Data• Adherence to Ethical Standard; Legal
Compliance• Tax Transparency

JFE GROUP CSR REPORT 2021

29

Editorial
PolicyGuideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyStakeholder Engagement
The JFE Group strives to maintain agreeable and favorable relationships with all stakeholders, including Stakeholder
Engagement shareholders, customers, clients, employees, and local communities, for the sustainable growth andmedium- to long-term increase of corporate value.
■ Engagement with JFE’s Major Stakeholders
OthersStakeholder

Major Communication Methods, etc.

Frequency (peryear)

Scale, etc.

Shareholders and Investors

We work to disclose
information accurately,
fairly and in a timely andappropriate manner aswell as strive for active
communication. We
established the Investor
Relations and Corporate
Communications
Department as anorganization responsible
for communication
with domestic andinternational shareholders
and investors, and topromote constructive
dialogue as well as provide
management with theinformation acquired, withthe aim of maintaining andimproving the relationshipof trust.

Ordinary general meeting of shareholders(convocation notices, notices of resolution, etc.)1

Approx. 150,000
shareholders

Investors meeting (financial results, medium-termbusinessplan, etc.), ESG briefings

5

Approx. 600
persons in total

Individual meeting (financial results, medium-termbusinessplan, etc.)

As needed

Approx. 300
persons in total

Briefings

4

Approx. 1,500
persons

Plant tours for shareholders (steel, engineering,shipbuilding bases)(Note: FY2019 results; plant tours were canceled in
FY2020 due to the COVID-19 pandemic)

23

Approx. 1,800
persons

2 (mid-year
and annual)

Approx. 220,000
copies/issues

1

Approx. 25,000
copiesInformation via websites (for shareholders andinvestors), etc.

As needed

Conducted ateach operatingcompany

Communication through sales activities and sales
support for quality assurance

As needed

Conducted ateach operatingcompany

Interviews and questionnaires, such as thoserelated to customer satisfaction

As needed

Conducted ateach operatingcompany

Information via websites (product information), etc.

As needed

Publishing shareholder newsletters (JFE Dayori)
Various reports, including integrated reports andCSR reports (Note: Number of issues published isfor the integrated report; CSR report is only posted
online)Customers
The Group believes thatthe stable supply of
products and services andreliable quality assurance,along with advancing
research and development,
are necessary to meetcustomer needs. We
will work to establish
win-win relationships bycontinuously meetingcustomer needs and thetrust they place in us.

JFE GROUP CSR REPORT 2021

30

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyOthersStakeholder

Major Communication Methods, etc.

Frequency (peryear)

Scale, etc.

Employees
Communications through daily operations and in
the workplace

As needed

Internal newsletters and intranet

As needed
2 to 4

Management
and labor unions
at each operatingcompany

As needed

87 consultations
in FY2020

Various training sessions

As needed

Position-specific,
compliance,
human rights,
etc.

Family days (visits by employee families, lunch at
employees’cafeteria), etc.

As needed

Conducted ateach operatingcompany

Corporate Ethics Awareness Survey

1 (every 3
years)At the Company
and operatingcompanies

Engagement Survey (employee satisfaction survey)
Note: Questionnaire targeting all employees forsurveying the level of satisfaction and applying
results to initiatives and operations.

1 (per year)

At the Company
and JFE SteelManagement feedback (360 degree analysis)
Note: Corporate officers and managers areevaluated by co-workers and subordinates, andreceive feedback.

1 (per year)

At the Company
and JFE Steel

Communication through local residents’association, events,etc.

As needed

Events at manufacturing bases (festivals, etc.)

1 (per year,
per region)

Approx. 270,000
persons per year

Plant tours

As needed

More than
100,000 persons
per year

Cleanup activities (vicinity of manufacturing bases,
regional cleaning, etc.)

As needed

Sports promotion (baseball or jogging workshops,
various sports competitions, etc.)

As needed

Others (dispatch of lecturers to elementary
schools, craft workshops, workplace experience
events, etc.)

As needed

Information via websites (environmental info, etc.)

As needed

Social contribution through JFE 21st Century
Foundation (various research support, regional
activity support, etc.)

As needed

Various labor-management commitees

Corporate Ethics Hotline
CSR initiatives are being
actively pursued together
with our clients, who
are important business
partners. We haveestablished Purchasing andProcurement Policies topromote fair and sincere
procurement activities
and to construct healthy
relationships with clients.

Local communities

To ensure business
continuity at manufacturingbases where steelworks
are located and elsewhere,
constructing a relationshipof trust with citizens in local
communities and realizing
coexistence and prosperity
are crucial. We will pursue
various activities with theaim of realizing sustainablegrowth and regional
development, including
continued initiatives
toward ensuring safety andreducing our environmental
impact.

JFE GROUP CSR REPORT 2021

31

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Group Value Chain
The JFE Group’s value chain encompasses upstream and downstream activities across the globe. We seek to addresssocial challenges by identifying the risks and opportunities that the Group must resolve through its business operations
and pursue initiatives that tackle those challenges. We will also continue to strengthen the sustainability of the entire
Group and implement countermeasures throughout our value chain.

Steel Business and Trading Business

Overview of the Value Chain

Manufacturing, Production,and Shipping

Procurement
Raw Material
Iron Ore

Machinery

Coal

Sales and Usage

Collecting Steel Scrap

Recycling
and Reuse of Resources

RecycleProcurement
To ensure stable supply of iron ore and coal used as raw materials in the production of steel products, we purchase fromvarious sources around the world such as Australia, North and South America, Russia, and Africa and transport materials
to the steelworks on a special vessel. Equipment and materials used at steelworks plants are also purchased globally.

Manufacturing, Production, and Shipping
The JFE Group is one of the world’s largest steelmakers and has cutting-edge technologies for the efficient production
and stable supply of high-quality steel products, used in products indispensable to daily life such as automobiles,
infrastructure, and home appliances. We also promote resource recycling by recycling steel scrap generated in theprocess of producing steel products while also repurposing iron and steel slag in cement and other construction materials.

Sales and Usage
The JFE Group is committed to developing eco-friendly products such as high tensile strength steel sheets that help
reduce the weight of automobiles as well as electrical steel sheets used in electric vehicles. We support the frontierof production by responding to the diverse needs of different industries through research and development and byimproving production technologies.
JFE GROUP CSR REPORT 2021

32

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyCollecting Steel Scrap
Steel products at the end of their product life cycle are collected as steel scrap and recycled as materials for the steel
production cycle.

Environment

Procurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

Manufacturing,
Production, andShipping

Sales andUsage

Collecting
Steel Scrap

Climate Change
JFE Group views the issue of climate change as a critical managerial concern from the perspective of business
continuity, and it considers achieving carbon neutrality by 2050 a top priority. By designating climate change issue asa material issue of corporate management, we are actively tackling the challenge to solve this issue.
Opportunities- Increased need for renewable energy
solutions- Expand electric furnace steelmaking
and electric furnace engineeringbusinesses- Contribute to reduced CO2 emissions
by providing high-performance steel
such as high tensile strength steel
sheets and electrical steel sheets
Risks- Physical and transitional impact ofclimate change (CO2 emissions, water
risk, etc.)- Introduction of a carbon tax- Disruptions to the supply chaincaused by climate change-related
disasters, natural disasters such as
earthquakes- Risk of floods associated with rising
sea levels

●

●

●

●

●

●

●

●

Key Initiatives
Climate Change (P.55)
Related Pages
S upply Chain Management (P.46)

Development and Provision of Eco-friendly Processes and Products (P.94)

Scenario Analysis in Line with the TCFD Recommendations (P.77)
Steel Industry Initiatives (P.90)

Environmental Data (P.198)

JFE GROUP CSR REPORT 2021

33

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Procurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

ESG Data

Manufacturing,
Production, andShipping

External
Evaluations
and Awards

Sales and
Usage

Editorial
PolicyCollecting
Steel Scrap

Development and Provision of Eco-friendly Processes and Products
Under our corporate philosophy of contributing to society with the world's most innovative technology, the JFE Group
strives to reduce its environmental impact by developing steel manufacturing processes and providing technologies
and products with due consideration for the environment.
Opportunities- Develop eco-friendly innovativetechnologies and ensurecompetitiveness

●

●

Risks
- Heightened decarbonization needs iniron and steelmaking process- Tighter environmental regulations- Increased environmental impact
during product use

●

●

●

Key Initiatives
Development and Provision of Eco-friendly Processes and Products (P.94)
Efficient Use of Resources
Given that such issues as resource depletion and environmental pollution are expected to intensify on a global scale,the JFE Group is enhancing resource recycling through recycling co-products generated in the iron and steelmaking
process and promoting the international recycling of steel scrap.
Opportunities- Renewed interest in recyclability ofsteel- Increased use of scrap- Expand the scrap distribution
business
Risks- Shortage of disposal sites for waste
generated- Resource depletion- Declining in the grade, rising price anddifficulty of obtaining obsolete scrap

●

●

●

●

●

●

●

Key Initiatives
Efficient Use of Resources (P.113)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE GROUP CSR REPORT 2021

34

Environmental Data (P.198)

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Procurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

ESG Data

Manufacturing,
Production, andShipping

External
Evaluations
and Awards

Sales and
Usage

Editorial
PolicyCollecting
Steel Scrap

Water Security
Steel manufacturing requires large quantities of fresh water for cooling and cleansing products and facilities. For thisreason, the efficient use of water resources with due consideration to the source of the water and stakeholders in thearea is a key challenge.
Risks- Increased environmental impact- Tighter environmental regulations- Risk of drought in the water intake
area, risk of pollution in the discharge
area

●

●

●

Key Initiatives
Water Security (P.117)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

Environmental Data (P.198)

Prevention of Pollution
Controlling air pollutant emissions and aggressively investing in environmental preservation are key for achieving
co-existence and mutual prosperity with local communities, the global environment, and society at large as well as
ensuring business continuity.
Risks- Increased environmental impact- Tighter environmental regulations

●

●

●

●

Key Initiatives
Prevention of Pollution (P.120)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE GROUP CSR REPORT 2021

35

Environmental Data (P.198)

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicySocialProcurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

Manufacturing,
Production, andShipping

Sales andUsage

Collecting
Steel Scrap

Responsibility to Customers
The JFE Group provides steel products used in diverse areas that are indispensable to daily life, such as automobiles,
infrastructure, and home appliances. One of our key responsibilities is to serve customers by meeting their quality
requirements and providing a stable supply of products.
Opportunities-E xpansion of CSR procurement anddevelopment of structure for stableprocurement- Ensure competitiveness throughstable production and stable quality

●

●

●

●

●

Risks
- Disruptions to the supply chaincaused by climate change-related
disasters, natural disasters such as
earthquakes, and COVID-19- Lose credibility with customers due
to issues related to production andquality- Declining in the grade, rising price anddifficulty of obtaining obsolete scrap

●

●

●

●

●

Key Initiatives
Responsibility to Customers (Provide Quality Products and Enhance Customer Satisfaction) (P.131)
Related Pages
Supply Chain Management (P.46)

Social Data (P.220)

Occupational Health and Safety
Providing for the health and safety of employees is a basic requirement of companies, particularly manufacturers,
and is fundamental to the continued existence of any company. The JFE Group adheres to the philosophy of safety
first, and, together with its Group companies and business associates, works to consistently maintain safe working
environments and secure workplaces for all employees.
Risks- Occurrence of accidents, including
occupational injuries●●

Key Initiatives
Occupational Health and Safety (P.138)
Related Pages
Supply Chain Management (P.46)

Social Data (P.220)

JFE GROUP CSR REPORT 2021

36

●

●

●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Procurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

ESG Data

Manufacturing,
Production, andShipping

External
Evaluations
and Awards

Sales and
Usage

Editorial
PolicyCollecting
Steel Scrap

Labor Standards
The JFE Group creates satisfying workplace environments and systems that incorporate diverse workstyles andenable employees with different backgrounds to fully demonstrate their abilities. We do this not only to comply withlaws and regulations but also to achieve sustainable corporate growth.
Opportunities- Secure excellent human resources
through workstyle reform
Risks- Labor shortage- Labor risks- Culture of passing down technicalskills is dying out

●

●

●

●

●

●

Key Initiatives
Labor Standards (Recruit and Nurture Diverse Human Resources) (P.148)
Related Pages
Social Data (P.220)
Human Rights
The JFE Group views respect for human rights as both a corporate social responsibility and a foundation of its
business. Our determination to not engage in discrimination in our business activities is clearly expressed in ourStandards of Business Conduct, which we have upheld throughout our actions. And we pursue Group-wide initiatives
based on the United Nations Guiding Principles on Business and Human Rights.
Risks- Potential human rights risks●●

Key Initiatives
Human Rights (P.160)
Related Pages
Supply Chain Management (P.46)

Social Data (P.220)

JFE GROUP CSR REPORT 2021

37

●

●

●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGovernance

Procurement
Challenges in the Value Chain

Raw Material
Iron Ore/Coal

Machinery

Manufacturing,
Production, andShipping

Sales andUsage

Collecting
Steel Scrap

Compliance
In expanding our businesses in and outside of Japan, it is important that JFE maintains relationships of trust withall stakeholders, including its customers, shareholders, and local communities. Trust can only be built upon a strong
foundation of ensuring thorough compliance. It is therefore extremely important to conduct training on corruption
prevention and other compliance training, so that all members of the organization can deepen their knowledge andawareness of compliance and perform their jobs accordingly.
Risks- Legal risks such as violations ofantitrust law or competition law

●

●

●

Key Initiatives
Compliance (P.189)
Related Pages
Supply Chain Management (P.46)

Governance Data (P.226)

Information Security
The JFE Group formulates various rules on information security management to prevent information leakage andsystem failure due to cyber-attack or improper system use and continually raise the level of its information security
management.
Risks- Cyber security risks

●

●

●

●

Key Initiatives
Risk Management (P.193)
Related Pages
Governance Data (P.226)

DX REPORT (https://www.jfe-holdings.co.jp/en/investor/library/dxreport/index.html)

JFE GROUP CSR REPORT 2021

38●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesEngineering Business

Overview of the Value Chain

Engineering (Creating the Foundations for Daily Life) — Business Operation/Operation Support (Bearing the Responsibility of Supporting Daily Life)
Planning, Development,
and Design

Production
and Construction

Procurement

Maintenanceand Operation

Engineering (Creating the Foundations for Daily Life)
The JFE Group has built many high-functioning, high-quality facilities in fields such as energy, the environment, andbridges while satisfying the needs of our customers every step of the way, from design to delivery. We have combinedand evolved the technologies for processing and assembling in shipbuilding business and technologies relating tomaterials and combustion in the steel business to create next-generation energy and to address environmental issues.
Many of our technologies support society. In addition, we are assembling our resources to develop new business models
and new technologies based on existing technologies. We produce high-quality products at low cost by establishingproduction sites, including one of the largest steel structure production factories in Japan, overseas bases centered on
Asian countries, and global engineering structures.

Business Operation/Operation Support (Bearing the Responsibility of Supporting Daily Life)
The JFE Group engages in many private-public initiatives in the field of public services by applying the operational andmaintenance know-how acquired over many years, primarily with regard to the environment and water and sewage
plants. Furthermore, we build plants, engage in the recycling business and renewable energy business, and take theinitiative to realize a recycling-oriented sustainable society. Going forward, we intend to expand our initiatives evenfurther.

JFE GROUP CSR REPORT 2021

39

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyEnvironment

Planning,
Development,
and Design

Challenges in the Value Chain

Procurement

Production andConstruction

Maintenanceand Operations

Climate Change
The JFE Group strives to reduce CO2 emissions in society through its eco-friendly products and technologies, including
renewable energy technologies and energy-saving products in its engineering business. The Group designates climatechange issue as a material issue of corporate management and is tackling the challenge to solve this issue.
Opportunities- Increased need for renewable energy
solutions- Increased demand for CCU/CCS facilities- More sophisticated needs in the energyenvironment area
- Increased response to climate change related
disasters (disaster prevention and mitigation,
disaster waste processing)- Increased demand for food waste power
generation

●

●

●

●

Risks
- Disruptions to the supply chain caused byclimate change-related disasters, natural
disasters such as earthquakes- Effects of meteorological disasters- Risk of floods associated with rising sea levels- Tighter environmental regulations

●

●

●

●

Key Initiatives
Climate Change (P.55)
Related Pages
Supply Chain Management (P.46)
Development and Provision of Eco-friendly Processes and Products (P.94)
Scenario Analysis in Line with the TCFD Recommendations (P.77)

Environmental Data (P.198)

Development and Provision of Eco-friendly Processes and Products
Under its corporate philosophy of contributing to society with the world’s most innovative technology, the JFE Groupwill contribute to meeting social challenges related to reducing environmental impact through business operations that
focus on the environment and recycling fields as growth sectors.
Opportunities- Need for improving operational efficiency andreducing environmental impact- Need for cost reduction and energy saving●

Key Initiatives
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE GROUP CSR REPORT 2021

40

●

●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Planning,
Development,
and Design

Challenges in the Value Chain

ESG Data

Procurement

External
Evaluations
and Awards

Production andConstruction

Editorial
PolicyMaintenanceand Operations

Efficient Use of Resources
Given that issues such as resource depletion and environmental pollution are expected to intensify on a global scale,our resource recycling solutions include operating our own waste recycling and energy supply businesses, in addition
to constructing and providing plants for waste incineration and sludge digestion to customers.
Opportunities- Increased demand for plastic recycling- Increased demand for food waste power
generation

●

Risks
- Shortage of disposal sites for waste generated- Prevention of resource depletion

●

●

●

●

●

●

Key Initiatives
Efficient Use of Resources (P.113)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

Environmental Data (P.198)

Water Security
We provide total management of water and sewage systems, including maintenance and operations, to secure vital
lifelines and are thereby contributing to reducing the negative impact on the water environment.
Opportunities- Need for improving operational efficiency andreducing environmental impact

●

Risks
- Risk of drought in the water intake area, riskof pollution in the discharge area
- Violation of environmental regulations and
laws

●

●

●

Key Initiatives
Water Security (P.117)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE GROUP CSR REPORT 2021

41

Environmental Data (P.198)

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Planning,
Development,
and Design

Challenges in the Value Chain

ESG Data

Procurement

External
Evaluations
and Awards

Production andConstruction

Editorial
PolicyMaintenanceand Operations

Prevention of Pollution
Controlling air pollutant emissions and aggressively investing in environmental preservation are key for achieving coexistence and mutual prosperity with local communities, the global environment, and society at large, as well as for
ensuring business continuity.
Opportunities- Need for improving operational efficiency andreducing environmental impact
Risks- Increased environmental impact- Violation of environmental regulations andlaws- Environmental accidents- Pollution of the environment

●

●

●

●

●

Key Initiatives
Prevention of Pollution (P.120)
Related Pages
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE GROUP CSR REPORT 2021

42

Environmental Data (P.198)

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicySocialPlanning,
Development,
and Design

Challenges in the Value Chain

Procurement

Production andConstruction

Maintenanceand Operations

Responsibility to Customers
The JFE Group has developed a global engineering system encompassing one of the largest steel structure production
factories in Japan, overseas bases centered on Asian countries, and global engineering structures. We intend to
maximize customer satisfaction by complying with the Group-wide quality policy, providing high-quality products andservices, and reinforcing our after-sales service system.
Opportunities- Expansion of CSR procurement anddevelopment of structure for stableprocurement- Implement requested functions- Need for cost reduction and energy saving- Expand the business scale throughprivatization of public services

●

Risks
- Lose credibility with customers due to issues
related to production and quality

●

●

●

●

●

Key Initiatives
Responsibility to Customers (Provide Quality Products and Enhance Customer Satisfaction) (P.131)
Related Pages
Social Data (P.220)
Occupational Health and Safety
Providing for the health and safety of employees is a basic requirement of companies, particularly manufacturers,
and is fundamental to the continued existence of any company. The JFE Group adheres to the philosophy of safety
first, and, together with its Group companies and business associates, works to consistently maintain safe working
environments and secure workplaces for all employees.
Opportunities- Maximize human capital through physical andmental health

●

●

●

●

Risks
- Occurrence of accidents, including
occupational injuries- Disruptions to the supply chain caused by
COVID-19

●

●

●

●

Key Initiatives
Occupational Health and Safety (P.138)
Related Pages
Supply Chain Management (P.46)

Social Data (P.220)

JFE GROUP CSR REPORT 2021

43

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

Planning,
Development,
and Design

Challenges in the Value Chain

ESG Data

Procurement

External
Evaluations
and Awards

Production andConstruction

Editorial
PolicyMaintenanceand Operations

Labor Standards
Providing for the health and safety of employees is a basic requirement of companies, particularly manufacturers,
and is fundamental to the continued existence of any company. The JFE Group adheres to the philosophy of safety
first, and, together with its Group companies and business associates, works to consistently maintain safe working
environments and secure workplaces for all employees.
Opportunities- Saving labor through new technology- Need for remote monitoring and automation
due to a lack of human resources
Risks- Labor shortage- Labor risks- Culture of passing down technical skills isdying out

●

●

●

●

●

●

Key Initiatives
Labor Standards (Recruit and Nurture Diverse Human Resources) (P.148)
Related Pages
Social Data (P.220)
Human Rights
The JFE Group views respect for human rights as both a corporate social responsibility and a foundation of its
business. Our determination to not engage in discrimination in our business activities is clearly expressed in ourStandards of Business Conduct, which we have upheld throughout our actions. And we pursue Group-wide initiatives
based on the United Nations Guiding Principles on Business and Human Rights.
Risks- Potential human rights risks●

Key Initiatives
Human Rights (P.160)
Related Pages
Supply Chain Management (P.46)

Social Data (P.220)

JFE GROUP CSR REPORT 2021

44

●

●

●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGovernance

Planning,
Development,
and Design

Challenges in the Value Chain

Procurement

Production andConstruction

Maintenanceand Operations

Compliance
In expanding our businesses in and outside of Japan, it is important that JFE maintains relationships of trust withall stakeholders, including its customers, shareholders, and local communities. Trust can only be built upon a strong
foundation of ensuring thorough compliance. It is therefore extremely important to conduct training on corruption
prevention and other compliance training, so that all members of the organization can deepen their knowledge andawareness of compliance and perform their jobs accordingly.
Risks- Legal risks such as violations of antitrust law
or competition law●●

Key Initiatives
Compliance (P.189)
Related Pages
Supply Chain Management (P.46)

Governance Data (P.226)

Information Security
The JFE Group formulates various rules on information security management to prevent information leakage andsystem failure due to cyber-attack or improper system use and continually raise the level of its information security
management.
Risks- Cyber security risks

●

●

●

Key Initiatives
Risk Management (P.193)
Related Pages
Governance Data (P.226)

DX REPORT (https://www.jfe-holdings.co.jp/en/investor/library/dxreport/index.html)

JFE GROUP CSR REPORT 2021

45●

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Supply Chain Management
Basic Policy
Through the adoption of the Sustainable Development Goals (SDGs) and the Paris Agreement, the international
community has called on companies to actively engage in actions to resolve global issues toward realizing a sustainable
society. Existing harmoniously with the global environment, respecting human rights, and providing challenging work
environments are some of the JFE Group’s commitments in the JFE Standards of Business Conduct and the Group
promotes initiatives under these standards. In order to realize a sustainable society, we believe it is important to addressthese challenges within the Group itself as well as across the entire supply chain. We will continue to push forward with
our initiatives supported by the understanding of our suppliers and other business partners.

Promoting Green Procurement
The JFE Group’s procurement policies help to conserve resources and protect the environment by ensuring adherence
not only to all laws and regulations but also to procurement principles stated in the Charter of Corporate Behavior
developed by the Japan Business Federation. Going forward, the JFE Group expects to accelerate such efforts in its
supply chains.

Procurement Policy and Initiatives by Each BusinessS

T JFE SteelBasic Procurement Policy
JFE Steel upholds its Basic Policy on Procurement to conduct purchasing activities with fairness and sincerity andthereby continue earning supplier trust as a good business partner.
JFE Steel’s basic purchasing and procurement policies are summarized below.
Materials & Machinery Purchasing Policy (https://www.jfe-steel.co.jp/en/company/purchase_policy.html)
As for material procurement, the company has established the Raw Material Purchasing Policy to develop and operatea sustainable procurement system for sourcing raw materials. Through the system, JFE Steel pays due consideration
to human rights, including the prohibition of child labor and forced labor, as well as legal compliance and environmental
protection. In addition, the company purchases raw materials after confirming that suppliers are not using conflictminerals.
JFE Steel’s Raw Material Purchasing Policy is summarized below.
Raw Material Purchasing Policy (https://www.jfe-steel.co.jp/en/company/purchase_policy.html#purchase_policy)

JFE GROUP CSR REPORT 2021

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesRequesting Suppliers to Promote CSR
JFE Steel believes that its social responsibility is to raise stakeholder satisfaction and enhance its corporate value. To
that end, the company prioritizes efforts in areas such as environmental protection, safety, disaster prevention, andcompliance, which are fundamental to its survival, and requests its suppliers to pursue their own CSR initiatives.

JFE Steel’s CSR Procurement Guidelines are summarized below.
CSR Procurement Guidelines (https://www.jfe-steel.co.jp/en/company/purchase_policy.html#to-our-business-partners)

Win-Win Relationships with Suppliers
JFE Steel establishes win-win relationships with our suppliers by leveraging their ideas for improving materials, designs,
shapes, specifications and production methods. The company’s value-analysis activities allow them to propose how to
reduce costs, improve materials functions, and upgrade quality, safety and work efficiency. The company then strives toimplement the ideas wherever possible.

E

N JFE Engineering

Fair and Sincere Procurement
JFE Engineering, viewing its suppliers as key partners in achieving mutual growth, strives to nurture mutual trust andreinforce partnership relationships. The company seeks to engage in procurement activities with integrity by complying
with guidelines on fair procurement and codes of conduct for building sound and equitable relationships with suppliers
and providing training for staff who are responsible for contracts.
The company collaborates with suppliers on CSR initiatives and upholds its Purchasing and Procurement Policies asa standard for fair and transparent procurement activities.

JFE Engineering’s Purchasing and Procurement Policies are summarized below.
JFE Engineering Group Procurement Policy (https://www.jfe-eng.co.jp/en/information/procurement_policy.html)
JFE Engineering requests that suppliers implement the following measures.
Requests to Suppliers Regarding CSR Initiatives(1)Comply with laws, regulations and social norms(2)Implement thorough information management(3)Provide safe and competitive products and services(4)Observe human rights, work environments and occupational health and safety(5)Respect the global environment(6)Develop an organization for promoting CSR

JFE GROUP CSR REPORT 2021

47

Message fromthe CEOS

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyH JFE Shoji

Ensuring a Safe, Fair Supply Chain
Corporate social responsibility (CSR) is a pivotal element in JFE Shoji’s supply chain for the provision of products,
functions, and services through its global business. Customer demand for CSR-based procurement is increasing every
year. In addition to its initiatives for quality, stable supply, safety, and reasonable prices, the company will also further
consider the global environment, human rights, and occupational safety and health in terms of its procurement.

JFE GROUP CSR REPORT 2021

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Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Management
Environmental Philosophy and Strategies
The JFE Group’s environmental philosophy and strategies target the development of innovative technologies andinternational cooperation aimed at protecting the global environment by having the intention to achieve “Accordance with
Global Environment” and “Improvement of Global Environment” within the corporate activity.

Environmental Philosophy

The JFE Group puts top priority on protecting and enhancing the global environment to maintain its business inharmony with the environment, ultimately for the prosperity of society as a whole.

Environmental Strategies

1. Reduce the environmental impact of all businesses
2. Contribute through technologies and products
3. Conserve resources and energy
4. Communicate with society
5. Facilitate international cooperation

Framework for Environmental Management
The JFE Group Environmental Committee, chaired by the president of JFE Holdings and operating under the JFE GroupCSR Council, sets goals for environmental protection, monitors the progress of such initiatives and works to improve theGroup’s overall environmental performance.
Key issues for corporate management such as climate change are deliberated at the Group Management Strategy
Committee as well and reported to the Board of Directors. The board oversees environmental challenges by discussing
the reported material. Additionally, specialized committees set up by JFE Group operating companies and affiliates
implement specific activities.
In our Seventh Medium-term Business Plan, which has positioned climate change as a top-priority business issue, we
formulated the JFE Group Environmental Vision for 2050 and are vigorously pursuing efforts to achieve carbon neutrality
by 2050.

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

For further details, refer to:
JFE Group CSR System (P.26)
Seventh Medium‐term Business Plan (P.12)
JFE Group Environmental Vision for 2050 (P.56)■ Environmental Management System

JFE Group Environmental Committee

JFE Steel Environmental Committee

Environmental Committee of Affiliate

JFE Engineering Environmental Committee

Environmental Committee of Affiliate

JFE Shoji CSR Promotion Council(Environmental Management Meeting)Group Company Environmental
Management MeetingGroup Environmental Liaison Committee

Group Company Environmental
Liaison Committee

Members
Environmental managers at JFE Holdings and each
operating company

Members
Environmental managers
at each operating company and Group company

Environmental Management System
Acquisition of ISO 14001 certification is an important part of every JFE Group company’s environmental program. All
global production sites of JFE Steel and JFE Engineering and major offices of JFE Shoji have received the certification,encompassing 70% of 42,091 employees at 81 companies covered in this report and 58% covered for total sites. In
FY2020, the number of major violations of environmental law or regulation by Group companies that resulted in a fine
was 0, and the total amount of fines and penalties was 0 yen.

S

T JFE SteelJFE Steel has an Environment Management Department at its head office and in each business office, and theEnvironmental Committee chaired by its president and the Environment Management Committee in each local office.

E

N JFE Engineering

JFE Engineering maintains an Environment Management Department at each of its major locations, including production
sites and branch offices as well as at each of the divisions in charge of products. The Environmental Committee, chairedby the president, oversees environmental management for the entire company. Under its Environmental Management
System, JFE Engineering works to minimize environmental impact at production sites, branch offices and construction
sites and contribute to environmental protection through all products and services. The major strategies for FY2021 are(1) promote environmental contribution through products for mitigating global warming and climate change, (2) promote
effective energy conservation and resource recycling, and (3) prevent violations of the Waste Management and Public
Cleansing Law.
JFE GROUP CSR REPORT 2021

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Message fromthe CEOS

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

H JFE Shoji

JFE Shoji obtained ISO 14001 certification for its head office, Osaka branch, and Nagoya branch in 2000 and later
expanded the scope of certification to all domestic offices. JFE Shoji also applies the same environmental management
system to domestic Group companies, promoting the same environment management activities and striving for thesame certification. Overseas coil centers are also planning to acquire ISO 14001 certification.
For quantitative data related to ISO 14001 for each business, please refer to the following information.
Environmental Data (P.198)

Environmental Audit
In addition to the regular internal and external audits at ISO 14001-certified sites, the audit and environment departments
at each operating company’s head office conduct independent environmental audits at their production sites.

S

T JFE SteelOnce a year, JFE Steel’s Audit Department and the Environment, Disaster Prevention and Recycling Department conduct
an environmental audit at each operational site. JFE Steel categorizes Group companies based on the result of risk
assessment considering owned equipment and conducts detailed audits every one to five years using checklists.

Environmental audit at a domestic Group company

E

N JFE Engineering

JFE Engineering places a top priority on complying with environmental laws and regulations.
To verify compliance with these regulations, environmental inspections are conducted at all construction sites by
the department responsible for construction, and the Tsurumi and Tsu manufacturing sites conduct self-checks on anannual basis to confirm legal compliance. In addition, about 50 locations, selected from among the manufacturing sites,
construction sites in Japan, and group company sites, are audited each year by the Safety and Environment Department
to confirm compliance with environmental laws and regulations. JFE Engineering also conducts internal audits on its own
environment management system to evaluate and enhance the effectiveness of various environment-related initiatives.

JFE GROUP CSR REPORT 2021

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Message fromthe CEOS

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

H JFE Shoji

At JFE Shoji, the ISO Environmental Audit Department annually confirms that processing centers and warehouses of
ISO 14001-certified Group companies comply with relevant environmental laws and regulations. For non-certified Group
companies, the department conducts an environmental audit every three years.

For quantitative data related to environmental audits, please refer to the following information.
Environmental Data (P.198)

Environmental Education
The JFE Group actively provides education to foster a corporate culture of environmental protection. Education
at operating companies includes training for new recruits and newly promoted employees as well as specificenvironmental-protection training organized by position and job.

S

T JFE SteelJFE Steel encourages employees to obtain qualifications as pollution-control managers. A training program forenvironmental managers at group companies was launched in FY2011. In addition, JFE Steel provides employeeswith training to ensure compliance with environmental laws, disseminates information about regulatory revisions at its
Environmental Liaison Committee meetings for Group companies, and organizes brush-up training in waste management
skills for onsite personnel.

E

N JFE Engineering

JFE Engineering educates all employees about environmental issues to increase their understanding of the company’s
related policies and initiatives. To ensure proper environmental management at its production sites and construction
sites, training is often tailored to the specific operations of employees, helping them to enhance their capabilities. In
FY2020, JFE Engineering worked on expanding its remote training opportunities.

S

H JFE Shoji

JFE Shoji provides all employees with general environmental training in compliance with ISO 14001 and specialized
training for internal audit staff on an annual basis. All employees within the scope of certification receive a pocket-size
ISO Employee Card to carry with them so they can check the details of ISO 14001 activities at any time. In addition, eachcompany performs a self-check using its own extensive checklist to ensure understanding and rigorous compliance withenvironmental laws. Also, JFE Shoji provides environmental training to new executives and information about revised
laws and regulations to environmental management personnel.
For quantitative data related to environmental education, please refer to the following information.
Environmental Data (P.198)

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Accounting
Basic Policy
The JFE Group is saving energy and reducing its environmental impacts by making its production facilities increasingly
efficient and introducing more environmentally friendly equipment. Any equipment or facilities related to energy
conservation and environmental protection are categorized as environmental investment, while all activities related toenvironmental protection and impact reduction are categorized as environmental expenses.

Environmental Investment and Expenses
Environmental capital investment totaled 29.7 billion yen and expenses amounted to 104 billion yen in FY2020. Capital
investment included 14.4 billion yen for measures to prevent global warming (measures to address climate change),
5.3 billion yen for air pollution countermeasures, and 4.7 billion yen for water pollution prevention. Environmental capital
investment as a percentage of overall capital investment was roughly 25%.
Environmental expenses for environmental activities included 32.9 billion yen for air pollution countermeasures, 25.2
billion yen for global warming countermeasures (measures to address climate change) and 16.9 billion yen for industrial
water recycling. Environmental R&D expenses came to 8.3 billion yen.

Capital Investment
To save energy and reduce environmental impacts stemming from production, the JFE Group invests in environmental
technologies for plants and equipment. Cumulative investment in energy savings, totaling 546.5 billion yen since 1990,
has enabled the company to achieve energy efficiencies that are among the highest in the world. In total, the Group has
invested 742.1 billion yen in environmental protection since 1973.

Results of Environmental Activities
Through these environmental investments and expenses, we are working to lower unit-based CO2 emission toprevent global warming and to reduce final-disposal waste by maintaining a high recycling rate to effectively use
natural resources. We are also striving to reduce emissions of pollutants into the water and air, which contributes toenvironmental protection and ensures thorough compliance with statutory regulations concerning exhaust gas emissions
and discharged water.
The monetary value of energy savings realized through environmental capital investments and expenses in FY2021
is about 0.9 billion yen.

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Breakdown of Environmental Costs
FY2020Main Items

Investment(billion yen)

Cost(billion yen)Management

Impact monitoring and measurement, and EMS expenses
and education

1.4

2.6

Global warming
countermeasures

Saving and efficiently using energy

14.4

25.2

Recycling industrial water

2.4

16.9

Recycling and waste management of internally generated
materials, etc.

0.6

4.8

Air pollution countermeasures

5.3

32.9

Water pollution countermeasures

4.7

10.6

Prevention of soil contamination, noise, vibration, andsubsidence

0

0.6

Other

Charges, etc.

—

1.6

R&D

Technologies for protecting the environment, saving energy,
and preventing global warming

0.8

8.3

Societal activities

Support for nature preservation and forestation, information
disclosure, exhibitions, and public relations

—

0.6

29.7

104.0

Conservation ofnatural resources

Environmental
protection

Total

Note: Data cover all investment activities of JFE Steel Corporation and R&D activities of JFE Engineering Corporation.
For quantitative data related to environmental accounting, please refer to the following information.
Environmental Data (P.198)

Related Links
Material Flow (P.198)
JFE Steel: Environmental Initiatives (Japanese only) (https://www.jfe-steel.co.jp/research/environment.html)
JFE Engineering: 360° JFE Engineering “Protecting Natural Environments” (https://www.jfe-eng.co.jp/en/360_jfe_engineering/#env)
JFE Shoji: Environment Management (https://www.jfe-shoji.co.jp/en/csr/environment/)

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Climate Change
Basic Policy
Climate change is an extremely important business concern for the JFE Group from the perspective of business
continuity. Our steel business, which emits 99.9% of the Group’s total CO2 emissions, has been developing various
technologies for saving energy and reducing these emissions. Applying these technologies to steel manufacturing has
successfully reduced CO2 emission intensity to the lowest level worldwide.
Furthermore, we have developed and maintained a variety of eco-friendly products and technologies, including highperformance steel materials that help save energy when customers use them, as well as renewable energy power
generation.
We will continue to develop and promote the widespread use of these processes and products while at the sametime seeking to turn this challenge into an opportunity to tackle climate change by deploying the technologies we havefostered across the globe.
JFE announced its endorsement for the TCFD recommendations in May 2019 and has identified climate changerelated issues based on the scenario analysis advocated in the TCFD to formulate strategies for sustainable growth. In
September 2020, JFE disclosed its target of reducing CO2 emissions in FY2030 in the steel business, which accounts
for most of the Group’s CO2 emissions. It also announced its intention to achieve carbon neutrality by 2050, ahead of theJapanese government’s announcement of the same goal.
In February 2022, the target of reducing CO2 emissions in FY2030 was revised upward to 30% or more compared to
FY2013 considering advances in measures for carbon neutrality and improvement of external surroundings in the steel
sector.

JFE Group Environmental Vision for 2050
The JFE Group intends to increase sustainability through solutions that address global climate change issues while
restructuring its business to respond to the changes in the environment surrounding the steel business. We regard 2020
to be the landmark year to further reinforce our efforts to tackle climate change, and we are actively promoting initiatives
for reducing CO2 emissions.
In 2021, having positioned climate change as a top-priority issue in the Seventh Medium-term Business Plan, we
formulated the JFE Group Environmental Vision for 2050 toward achieving carbon neutrality by that year.
We will systematically address climate change by reflecting the TCFD’s principles in our business strategies in the
JFE Group Environmental Vision for 2050. In the steel business, we will reduce CO2 emissions by 18% from FY2013
levels by the end of FY2024. In addition, we announced that the target of reducing CO2 emissions in FY2030 is 30% ormore compared to FY2013 in steel business. To explore all possibilities for realizing carbon neutrality in 2050, we will takeon the challenge of developing super-innovative technologies such as carbon-recycling blast furnaces developed with
our unique techonology while also adopting a multitrack approach for pursuing other technologies. In our engineeringbusiness, we will widen our contribution to the reduction of CO2 in society as a whole by expanding and advancing
renewable power generation and carbon recycling technologies, by supplying high-performance steel products, andthrough other initiatives. Furthermore, we will accelerate commercialization of our offshore wind-power business byapplying the strengths of the Group.

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VisionCSRManagement

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Editorial
PolicyJFE Group Environmental Vision for 2050
• Climate change is an extremely important business concern for JFE, and we are aiming to achieve carbon
neutral by 2050.
• We will accelerate our research and development of new technologies and pursue super-innovativetechnologies.
• We will seek business opportunities that allow us to enhance our corporate value by contributing to CO2emissions reduction across society.
• The principles of TCFD will be reflected in our business strategies and deployed in a systematic manner.
Seventh Medium-term Business Plan Initiatives▶ Reduce steel-business CO2 emissions in FY2024 by 18% compared to FY2013 (JFE Steel).
The target of reducing CO2 emissions in FY2030▶ Reduce steel-business CO2 emissions in FY 2030 by 30% or more compared to FY 2013 (JFE Steel).
Initiatives for Carbon Neutrality by 2050
(1) Reduce CO2 emissions at JFE Steel▶ Pursue super-innovative technology for carbon-recycling blast furnaces and CCU.
▶ Develop hydrogen-based ironmaking (direct reduction) technology.
▶ Leverage top-in-class electric arc furnace technology for high-grade steel manufacturing, high efficiency, etc.
▶ Develop transitional technologies for carbon neutrality, including ferro coke, increased use of steel scrap inconverters, energy savings, and low-carbon energy transformations.
(2) Expand contributions to CO2 emissions reduction in society▶ JFE Engineering: Expand and develop renewable-energy power generation and carbon-recycling technologies.
Reduce CO2 emissions by 12 million tonnes in FY2024 and 25 million tonnes in FY2030.
▶ JFE Steel: Develop and market eco-products and eco-solutions.
▶ JFE Shoji: Increase trading in biomass fuels, steel scrap, etc., and strengthen business in supply chain management(SCM) for eco products.
(3) Offshore wind-power generation business▶ Accelerate commercialization of the offshore wind-power business by applying the strengths of the Group.
JFE Engineering: Manufacture and market monopiles and other seabed-fixed structures for offshore wind-power
generation.
JFE Steel: Use the new continuous casting machine in Kurashiki to produce large heavy plates.
JFE Shoji: Carry out SCM for steel materials and processed products.
Japan Marine United Corporation: Manufacture offshore wind power-generation floating structures and construct
work vessels.
Group-wide: Operation and maintenance (O&M) making maximum use of Group resources.

Notes.
1. Carbon-recycling blast furnace: A technology that converts CO2 from the blast furnace into methane and repeatedly
uses it as reducing material in the blast furnace
2. CCU: Carbon dioxide capture and utilization
3. Transitional technologies: Technologies that advance the transition to low carbon and decarbonization
4. Ferro coke: Innovative blast furnace raw material that improves the reduction efficiency of iron ore and reduces CO2
generation
Seventh Medium-term Business Plan (P.12)
JFE Group Environmental Vision for 2050, Presentation Material(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021-210525-release01.pdf)

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PolicyGuideline
IndicesDeveloping processes to mass produce high-performance steel with zero CO2 emissions is essential for a sustainable
world. Huge R&D and equipment replacement costs will be inevitable as JFE executes strategies targeting carbon
neutrality. Society must decide how these costs should be shouldered, including government support.
Working toward the lofty goal of carbon neutrality by 2050,
JFE aims to establish the necessary decarbonization technologies as soon as possible, ahead of global competitors,
assuming that we have the decarbonization infrastructure in place and ability to compete on an equal footing globally.
■ JFE Group's Activities for Carbon Neutrality

JFE Steel’s Management Structure to Promote Carbon Neutrality
In October 2020, JFE Steel established a company-wide project team that directly reports to the president to promote
the development and commercialization of ultra-innovative technologies for achieving carbon neutrality by 2050. In
July and October of 2021, the company further enhanced its management structure for promoting carbon neutrality byintroducing new specialized departments. This management structure will help the company accelerate its efforts toachieve carbon neutrality.
■ JFE Steel’s Management Structure to Promote Carbon Neutrality
Board of Directors

Management Committee

Carbon Neutral Advancement Committee: Members of the management committee and project teamCarbon neutral advancement project teamProject Leader: Executive Vice President Responsible for the Corporate Planning Department(Head office)Carbon Recycling Development Department
Advanced Melting Process Development
Department
Raw Materials Department: Green Raw
Materials Section

Corporate Planning
Department

Facilities Planning
Department

Each Technology Department
Technology Planning
Department

Sales Coordination &Operation Planning Department

Each Sector(Steel Production Sites, Steelworks) Planning, Manufacturing departments

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(Steel ResearchLaboratory) Specialized
teams fromeach department

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Information Disclosure Based on TCFD Recommendations

On May 27, 2019, JFE Holdings announced its endorsement for
the final report of the Task Force on Climate-related Financial
Disclosures (TCFD)*.
*The TCFD was established by the Financial Stability Board (FSB) at the request of G20 finance ministers andcentral bank governors.

Climate-related risks and opportunities will significantly impact medium- to long-term corporate finance. To reduce therisk of instability in the financial market, the G20 called on the FSB to establish the TCFD. The TCFD considers disclosure
methodologies that can be used to appropriately assess climate-related risks and opportunities and releases its findings
as a final recommendations report.
It is important for investors to accurately understand the financial impact of climate-related risks and the opportunities
of investee companies when they make financial decisions. In this context, the task force recommends disclosures tobe made in four core elements of organizational management: governance, strategy, risk management, and metrics andtargets.
For the TCFD content index, click on the following link.
Guideline Content Indices (P.247)

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Governance
Under the JFE Group Standards of Business Conduct, the JFE Group actively strives to exist in harmony with the global
environment and create a society that is comfortable and convenient. We are aware that efforts to protect the global
environment, such as reinforcing our environmental protection activities and addressing climate change issues, areextremely important for creating a sustainable society.
In FY2016, we identified the mitigation of global warming as a material CSR issue to facilitate the PDCA cycle andpromote appropriate management of ongoing initiatives, such as reducing CO2 in the iron and steelmaking processes anddeveloping and providing eco-friendly products. In 2021, we relaunched the initiative as a top priority by adding economic
perspectives to the material issues and by selecting other vital matters of importance. As part of this effort, we set
our goal for helping to address climate change (initiatives to achieve carbon neutrality by 2050) as an area of focus andidentified reducing the JFE Group’s CO2 emissions and contribution to CO2 emissions reduction in society as two material
issues.
The JFE Group Environmental Committee, chaired by the president of JFE Holdings and operating under the JFEGroup CSR Council, supervises and guides these initiatives by deliberating goals, monitoring progress, and improving theGroup’s overall environmental performance.
Key managerial issues such as climate change and other environmental challenges are deliberated at the GroupManagement Strategy Committee as well and reported to the Board of Directors. The board discusses and makes
decisions on the matters reported.
■ Examples of Climate Change-Related Agenda Items Involving Board of Directors Discussions, Decisions, and Reports- Declaration of endorsement for the final TCFD recommendation report- Information disclosure consistent with TCFD recommendations (scenario analysis and other information)- Formulation of the Seventh Medium-term Business Plan, JFE Group Environmental Vision for 2050

Corporate Governance System (P.179)
Framework for Environmental Management (P.49)

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PolicyAddressing Climate Change Issues
The JFE Group considers climate change as a top-priority business concern andwill vigorously pursue the goal of achieving carbon neutrality by 2050.
The JFE Group recognizes climate change as a vital management issue to overcome in order to achievesustainable growth and enhance corporate value over the medium to long term. We believe that climate change
and its global impact merit urgent consideration, and we have been taking action to reduce our CO2 footprint.
In the Seventh Medium-term Business Plan (FY2021−FY2024) issued in May 2021, the JFE Group
reconfirmed that climate change is a top priority and developed specific measures to address it. In order toachieving carbon neutrality by 2050, we formulated the JFE Group Environmental Vision for 2050, which
includes the following three major policies, and entered a new stage of tackling the change.
In accordance with our corporate vision of contributing to society with the world’s most innovativetechnology, we will take on the challenge of developing ultra-innovative technologies to tackle climate change.
At present, there is no guaranteed solution for achieving carbon neutrality by 2050, which will require us todevelop new ultra-innovative technologies in the steel business. We have presented a roadmap that includes
specific measures for achieving carbon neutrality. This roadmap is based on pursuing our unique superinnovative technology, carbon recycling blast furnace with CCU, and also includes the development of othertechnologies such as hydrogen-based ironmaking and electric arc furnace technology. We will realize these
innovative technologies through multiple strategies to ultimately achieve the goal of carbon neutrality.
Next, we will view CO2 reduction initiatives as both a response to business risks and a new business
opportunity for helping to realize a sustainable society. We will also enhance our corporate value by contributing
to CO2 emissions reduction throughout society. By reducing overall CO2 emissions, we will contribute to therealization of carbon neutrality for society as a whole. In our engineering business, we will expand and develop
technologies for renewable energy power generation and carbon recycling. In our steel business, we will workon electrical steel sheets and ultra-high-tensile strength steels to promote the shifts to EVs and lighter weightautomobiles. In particular, our offshore wind-power generation businesscan take full advantage of the capabilities of all our operating companies.
We will make a Group-wide effort to accelerate this business.
Lastly, the Group will reflect the principles of the TCFD in its businessstrategies and systematically address climate change. In May 2019, theGroup announced its endorsement for the TCFD recommendations. For the
first time, we disclosed information based on the TCFD recommendationin our CSR REPORT 2019 and clarified business risks and opportunities
through scenario analysis. This year, we deepened these efforts andformulated the JFE Group Environmental Vision for 2050 as a key strategy
in our Seventh Medium-term Business Plan.
A process capable of producing large quantities of high-performancesteel without emitting CO2 is essential for society’s sustainable
development. We recognize that we must address this issue in order for
the JFE Group to survive amid global competition. To achieve the lofty
Seiya Kitajima
goal of becoming carbon neutral in 2050, we will strive to establish the
Senior Executive Officer,
necessary decarbonization technologies as early as possible, ahead of our
JFE Holdings, Inc.
global competitors.

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JFE Group’s Climate Change Strategy
Various risks and opportunities related to climate change are integrated into the JFE Group’s business strategy. The
Group formulated the its Seventh Medium-Term Business Plan as the main guide for business operations from fiscal
2021 to fiscal 2024, and we positioned efforts to address climate change as the key to achieving sustainable growthand increased value over the medium to long term. Under the plan, the Group defined ensuring environmental andsocial stability as a core strategy and formulated the JFE Group Environmental Vision for 2050 for achieving carbon
neutrality by 2050. Then we concentrated our efforts on our business strategy and reflected the principles of the TCFD
recommendations in our management strategy, enabling us to systematically address climate change. Furthermore, weare disclosing information based on the TCFD recommendations, including the scenario analysis, leveraging them toidentify and evaluate risks and opportunities, and reflecting them in our management strategy.
For further details on the Results of Scenario Analysis and the JFE Group Environmental Vision for 2050, refer to thefollowing source material.
Scenario Analysis recommended by TCFD (P.77)
JFE Group Environmental Vision for 2050, Presentation Material(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021-210525-release01.pdf)

In the JFE Group Environmental Vision for 2050, our efforts to achieve carbon neutrality are based on the following three
key strategies: reduce CO2 emissions at JFE Steel, expand contributions to the reduction for society as a whole, andaccelerate Group-wide commercialization of the offshore wind-power business. In the steelmaking process, which has
a particularly significant environmental impact, we will focus on reducing CO2 emissions. In addition, we will emphasize
the reuse of water resources and energy as well as the development and provision of environmentally sound products,
process technologies, and resource recycling solutions.

Reduce CO2 Emissions at JFE SteelCarbon Recycling Blast Furnaces (CR Blast Furnace)
We will work on developing carbon-recycling blast furnaces (CR blast furnaces), hydrogen steelmaking, and electric
furnaces, and we will also strive to achieve carbon neutrality by 2050, as announced in the JFE Group Environmental
Vision for 2050. We are particularly focused on a technology that combines a CR blast furnace and CCU*, which allows us
to efficiently mass produce high-grade steel and reuse the CO2 in the blast furnace. This technology aims for virtually zero
emissions by using the remaining CO2, which cannot be fully reused to manufacture basic chemicals such as methanol.
*Carbon dioxide capture and utilization

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Technical Features of a CR Blast Furnace
The CR blast furnace is ultra-innovative in terms of its technology that converts CO2 in the furnace exhaust gas intomethane (through methanation), which is then used repeatedly as reducing material in the furnace. The technology is
expected to reduce CO2 by 30% in the blast furnace alone and to ultimately help achieve carbon neutrality by leveraging
CCU/CCUS*. The thermal efficiency of the process can be further increased by replacing the air blown into the blast
furnace with pure oxygen, as the energy used to heat the nitrogen in the air can instead be used to heat methane.
In addition, the lack of nitrogen facilitates the separation of CO2, so the equipment necessary to separate CO2 formethanation can be smaller and more efficient while facilitating more effective gas utilization at CCUS.
*CCUS: CO2 capture, utilization, and storage■ Conceptual Diagram of a Carbon Recycling Blast Furnace

Opening the Way to Innovation
Commercializing CR blast furnaces requires the following technological innovations. The JFE Group will take on thechallenge of achieving these and also strive to reach carbon neutrality by 2050.
①Technology to reduce CO2 by blowing a large volume of carbon-neutral methane along with oxygen into the blast
furnace (world first)②Linking the operations of a large-scale methanation facility and a CR blast furnace (world first)

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New Technology to Process Raw Materials for Hydrogen Reduction Ironmaking
Hydrogen reduction ironmaking technology is another steelmaking process that the JFE Group is working on to achievecarbon neutrality. With this technology, the natural gas currently used in direct reduction ironmaking is replaced by 100%hydrogen to eliminate CO2 emissions when iron ore is reduced.

Technology for Processing Raw Materials
Currently, the only raw material that can be used for direct reduction ironmaking is high-grade iron ore. Its production
volume, however, is limited, and we expect it will become even more difficult to obtain in the future if direct reduction
ironmaking were to expand worldwide.
To address this, JFE and one of its iron ore suppliers, BHP, are collaborating in the development of a new raw material
processing technology for low- and medium-grade ores, which are currently used as raw materials for blast furnaces
due to their large production volume. We are hoping that this new technology will allow us to use low- and mediumgrade ores as raw materials for direct reduction ironmaking, thus expanding the raw material sourcing for direct reduction
ironmaking.
Technology for Pre-Heating Raw Materials, Technology for Heating Hydrogen Gas
One challenge of hydrogen reduction is that the reduction of iron ore by hydrogen is an endothermic reaction, whichmeans that heat must be applied externally for the reaction to proceed. A sufficient reduction reaction may not take place
if there is not enough heat. Thus, technologies for heating raw materials and hydrogen gas must be developed.
Development of Electric Arc Furnace Process Technology
One of the JFE Group’s development efforts in steelmaking technologies for carbon neutrality is electric arc furnace
process technology. With the technology, steel products are manufactured by melting steel scrap and direct-reducediron in an electric furnace. So far, we have managed to reduce CO2 emissions from this steelmaking process down to
one-quarter of that of the blast furnace-converter method. We are working to eliminate CO2 emissions generated by theelectric furnace process in the future by using the aforementioned hydrogen-reduced iron as the raw material and green
electricity.
Although the electric furnace process has this advantage of reducing CO2 emissions, there are two major problems
with it compared to the blast furnace-converter method: the productivity of the electric furnace process in general isabout 30% lower than that of the blast furnace-converter method, and the use of scrap as the raw material inevitably
increases the concentration of impurities, which limits the production of high-grade steel. We are working to addressthese issues and striving to establish technologies that will enable the production of high-quality, high-grade steel withhigh productivity in the electric furnace process.
Improve productivity of the electric arc furnace process
To improve productivity of the electric arc furnace process, the JFE Group have developed ECOARC™, our proprietary,
eco-friendly, high-efficiency electric arc furnace, and installed it at our operating companies. With this technology, a shaft
is attached to the upper part of the electric furnace and is used to continuously feed scrap materials into the furnace. It
uses the high-temperature exhaust gas from the furnace to preheat the scrap material, allowing for subsequent highefficiency and high-speed melting. As well as improving the productivity of the electric arc furnaces, the technology also
reduces the energy (electricity) required for the melting process.
The Group already has achieved industry-leading productivity and energy (electricity) efficiency with thesetechnologies, but we are working to raise productivity even further.

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Indices■ Eco-friendly, high-efficiency electric arc furnace ECOARC™

Manufacturing Higher-Grade Steels Using the Electric Arc Furnace Process
The electric arc furnace process uses scrap and reduced iron as raw materials. The higher concentration of impurities inthese materials, such as copper, causes material degradation, including surface defects and reduced workability in steel
sheets and deterioration of properties in electrical steel sheets. We are working on two technologies to address theissue, one to remove impurities and another to detoxify impurities, so that we can use the electric arc furnace process
to produce high-grade steel products such as steel sheets for automobiles and electrical steel sheets.
■ Related Products and Technologies
Reduce CO2 emissions at JFE SteelCarbon Neutral

Management Structure to Promote Carbon
Neutrality (Japanese only)

Management
Structure(https://www.jfe-steel.co.jp/release/2021/09/210922.html)

JFE Group Environmental Vision for 2050
“Carbon-recycling Blast Furnace Technology
Development”

Carbon-recycling blast
furnace(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021210525-release01.pdf)

Carbon-recycling blast
furnace technology

Challenge Zero (Challenge for developmentof super-innovative technologies focusing on“Carbon-recycling Blast Furnace + CCU)
(https://www.challenge-zero.jp/en/member/34)

Challenge Zero (Technology of CO2 utilization)

CCU/CCUS

New technology to process
raw materials for hydrogen
reduction ironmaking(https://www.challenge-zero.jp/en/casestudy/391)

JFE Group Environmental Vision for 2050
(Development of Technology for 100% Direct
Hydrogen Reduction)

Development oftechnology for directhydrogen reduction(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021210525-release01.pdf)

JFE Steels and BHP to Address Decarbonizationin Steelmaking Process

Collaboration with amaterial supplier(https://www.jfe-steel.co.jp/en/release/2021/210210.html)

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Indices■ Roadmap to Carbon Neutrality in 2050
• Accelerate research and development for the early establishment of new technologies• Adopt a multitrack approach to develop super‐innovative technologies, focusing on carbon recycling blast
furnace + CCU and hydrogen ironmaking (direct reduction)• Maximize the use of industry‐leading electric arc furnace technology

CO₂ reduction
targets

18% reduction comparedto FY2013 (steel business)
2020

2024

30% or more reduction comparedto FY2013 (steel business)
2030

Carbon neutrality
by 20502040

Develop a carbon-recycling
blast furnace with CCU

2050

Implementation*(device processes and large-scale production in stages)

Transformation of
the steelmaking
processes

Utilize transition technologies for existing processes:• Ferro-coke, COURSE50, CCU, etc.
• Maximize the use of industry-leading electric arc technology
Advance technologies for manufacturing high-grade steel,introduce eco-friendly electric arc furnaces, etc.

Develop hydrogen-based
ironmaking (direct reduction)

Process
Integration
Iron source
diversification
Implementation**As prerequisites for implementation, the necessary social infrastructure is in place, including the supply of hydrogen at low cost and in large quantities,
the mechanism for cost sharing across society, etc.

Seventh Medium-term Business Plan (P.12)
JFE Group Environmental Vision for 2050, Presentation Material(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021-210525-release01.pdf)

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Expand Contributions to CO2 Emissions Reduction in Society
Contribution to CO2 Reduction through our Engineering Business
Demand for power generation plants using renewable energy sources that do not emit carbon is expected to increase.
Through JFE Engineering, the JFE Group is handling the design, procurement, construction, and operation of various
renewable energy generation plants including biomass, geothermal, solar, and onshore wind power. We are also working
to increase the amount of power generated at waste treatment facilities in order to promote recycling and the effective
use of resources.
Furthermore, we are actively engaged in the retailing of electricity, which uses these renewable energies as the main
power source, as well as in supporting the establishment and operation of new regional electricity companies that focus
on local production and local consumption of energy using renewable energies.
As a new initiative toward carbon neutrality, we are developing CCU technology that uses exhaust gas and waste
plastic, for which we have already established the necessary technologies to collect, separate, and produce synthesisgas (CO + H2) and use it as a raw material for manufacturing chemicals.
Through these efforts, we will contribute to reducing CO2 emissions in society by 12 million tonnes by FY2024 and25 million tonnes by FY2030.
Electrical Steel Sheets
Electrical steel sheets are widely used as core materials for electrical equipment such as motors and transformers andtherefore play an important role in determining the performance of such electrical equipment. JFE Steel is contributing
to reducing CO2 emissions on a global scale by supplying high-performance electrical steel sheets.
Non-Oriented Electrical Steel Sheets
Demand for high-grade non-oriented electrical steel sheets, indispensable for electric automobiles, is expected to rapidly
increase as global environmental regulations are accelerated/strengthened. In response to this demand, we have decided
to invest approximately 49 billion yen to double the production capacity of high-grade non-oriented electrical steel sheetsat the West Japan Works (Kurashiki district) in the first half of FY2024.

■ Demand for Non-Oriented Electrical Steel Sheets(Calculated by JFE; 2019 results = 1.0)
6.0
5.0
4.0
3.0
2.0
1.0
0

2020

2021

2022

2023

2024

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(FY)

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IndicesGrain-Oriented Electrical Steel Sheets
The global demand for grain-oriented electrical steel sheets in transformers is expected to increase due to continuous
growing demand for electric power and the expanding adoption of renewable energy. Demand in India for grain-oriented
electrical steel sheets is expected to increase by 1.7 times in 2030 compared to 2019. Moreover, we have agreed with
our strategic-alliance-partner JSW to study the feasibility of establishing a joint, grain-oriented steel (G/O) manufacturing
and sales company in India.
 emand for Grain-Oriented Electrical Steel Sheets in India■D(Calculated by JFE; 2019 results = 1.0)
2.0

1.5

1.0

0.5

0

2019

2025

2030

(FY)

Super Core
In recent years, motors are becoming increasingly smaller and faster (for driving electric vehicles, home appliances,
drones, etc.), and they are requiring higher output and efficiency. For electrical steel sheets, used as iron core materials
for these products, there is growing demand to reduce high-frequency iron loss*1 and increase magnetic flux density*2.
Silicon boosts the electrical resistance of steel, so increasing the amount silicon helps to achieve this is necessary. Using
the proprietary technology for CVD continuous siliconizing*3, we worked to control silicon concentration distribution
by optimizing the siliconizing amount and diffusion conditions and to control crystal orientation. These efforts haveresulted in the development of a JNRF™ silicon-gradient steel sheet for high-speed motors. JNRF™ helps to significantly
increase motor efficiency for energy conservation while maintaining magnetic flux density (torque) equivalent to that ofconventional non-oriented electrical steel sheets (3% silicon steel sheets).
*1 Iron loss refers to energy, mainly heat, lost when an iron core is excited by an alternating current. The energy loss
that occurs when the iron core is excited at high frequency is called a high-frequency iron loss. The efficiency of highspeed motors increases as high-frequency iron loss is reduced.
*2 Magnetic flux density, which indicates a material’s ease of magnetization, raises electromagnetic strength as density
increases. In motors, larger torque (power) can be achieved with materials that offer high magnetic flux density.
*3 The chemical vapor deposition (CVD) process technology increases silicon concentration in steel. CVD, performed in asteel strip annealing line, causes a reaction between steel strips and silicon tetrachloride (SiCl4) gas in a furnace while
continuously passing the steel strips through the furnace.

■ Super Core Manufacturing Process

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Policy■ Related Products and Technologies
Expand contributions to CO2 emissions reduction in society

New regional electricity

Regional Electricity Retail Businesses
in Partnership with the Local Municipal
Governments Establishing New Regional
Electricity Businesses(P.107)

Contribution to CO2 Reduction
through the Engineering
Business

Food waste recycling

Food Waste Recycling Business(P.106)

Carbon recycling initiatives (CO2 separationand collection, waste to chemical)

Carbon recycling(P.108)JFE Steel develops JNRF™ silicon-gradientsteel sheet for high-speed motors—
minimizes high-frequency iron loss andimproves high magnetic flux density

JNRF™

(https://www.jfe-steel.co.jp/en/release/2020/201203.html)

JFE Steel to expand electrical steel sheet
production capacity at Kurashiki facility

Facility expansion
Electrical Steel Sheets(https://www.jfe-steel.co.jp/en/release/2021/210401.html)

JFE Steel & JSW Steel proposes Grain Oriented
Steel Sheet Manufacturing JV in India
Supply chain for electricalsteel sheets(https://www.jfe-steel.co.jp/en/release/2021/210507.html)

Establish a global supply chain in electricalsteel sheets business(P.111)

Accelerate Group-wide Commercialization of the Offshore Wind-Power Business
Offshore wind power generation is a key initiative of the Japanese government’s Green Growth Strategy to achievecarbon neutrality by 2050. We will work in this area by leveraging the Group’s collective strength and our engineeringbusiness acting as the main driver. Specifically, we will become the forerunner in the business of offshore wind-power
generation by manufacturing and commercializing the foundation structures (monopiles) and establish a supply chain
across the Group, including manufacturing foundations and O&M.**Operation and maintenance

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Policy■ Commercialization of Offshore Wind-Power Business• By commercializing our manufacturing of foundation structures (monopiles), we will become the forerunner inthe business of offshore wind-power generation and establish a supply chain across the entire Group,
including foundation manufacturing and O&M.*1• We will aim to expand business in the field of renewable energy by leveraging the JFE Group’s collective
strengths (synergies), with JFE Engineering as the main player.

JFE Steel

JFE Engineering

Increased production capacity and stablemass production of large and heavy plates
for offshore wind power generation

Manufacture seabed-fixed foundation
structures*2 for offshore wind power
generation
Steel supply

Utilization of Kurashiki No. 7 Continuous Casting Machinein Kurashiki district (started operation in June 2021)

Steel supply

SCM support
Steel supply

SCM support

JFE Shoji

Each company under the GroupSCM construction for steel products andprocessed products for offshore wind
power generation contributes toGroup collaboration

JMU*3: fabrication of offshore wind turbine
floats and construction of work vessels
Group-wide: O&M with maximum use ofresource*1 Operation and maintenance. Apply expertise of maintenance and analysis technologies.
*2 Seabed-fixed foundation structures: monopiles, jackets, etc.
*3 Japan Marin United Corporation (equity method affiliate)■ Related Products and Technologies
Accelerate commercialization of our offshore wind-power business by applying the strengths of the Group.

Establishment of new organization for offshore wind

New offshore windpower PJ teambusiness (Japanese only)(JFE Engineering)(https://www.jfe-eng.co.jp/news/2021/20210831.html)

Capital investment for the construction of the newfactory for monopile foundations decided - Japan's
first manufacturing base for the bottom—mounted
foundations of offshore wind turbines(JFE Engineering)

Offshore wind-power
generation business(https://www.jfe-eng.co.jp/en/news/2021/20210720.html)

Equipment foroffshore wind power
generation

No. 7 continuous casting machine at JFE Steel WestJapan Works (Kurashiki district) began its operation(Japanese only)(JFE Steel)(https://www.jfe-steel.co.jp/release/2021/06/210616.html)

SCM for Steel Materials and Processed Products for
Offshore Wind Power Generation(JFE Shoji)(P.111)JFE GROUP CSR REPORT 2021

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Indices

Risk Management (Climate Change)
JFE Holdings is responsible for comprehensive risk management in accordance with its Basic Policy for Building Internal
Control Systems. The JFE Group CSR Council chaired by the president of JFE Holdings, consolidates information andstrengthen management across the Group to reduce the frequency and impact of risks.
The executive officer responsible for risk works to identify potential ESG risks such as those associated with climatechange. As necessary, the JFE Group CSR Council confirms and evaluates risks and discusses and makes decisions on
countermeasures. Key managerial issue are deliberated by the Group Management Strategy Committee.
The Board of Directors supervises initiatives on ESG risks such as those related to climate change and CSR by
discussing and making decisions on, and by receiving reports on, these matters.
Climate-related risks are identified and evaluated based on a scenario analysis conducted under the framework
recommended by the TCFD in 2017. Important factors that may affect management are selected for further analysis andused in formulating business strategies, such as the Seventh Medium-term Business Plan.

Monitoring Method for Core Issues Related to Climate Change
Issues that may affect management are being monitored by the JFE Group CSR Council, Group Management Strategy
Committee and the Management Committee. As for the method, measures are implemented based on a quarterly
report on climate change-related issues deliberated by the specialized committees of each Group company (e.g.,
the Environmental Committee). The JFE Group Environmental Committee consolidates information and strengthens
management to reduce the frequency and impact of risks and to maximize opportunities.
Countermeasures Based on Monitoring
1. Group-wide deliberations
2. Monitoring penetration of policies within the Group
3. Monitoring deployment of policies throughout the GroupFor further details, refer to the following links.
CSR Structure (P.26)
Risk Management (P.193)
Environmental Management (P.49)

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Metrics and Targets (Medium- and Long-term Targets and Results in FY2020)
The JFE Group’s steel business is led by its operating company, JFE Steel, which is a member of the Japan Iron and SteelFederation (JISF). The JFE Group is promoting the JISF’s Commitment to a Low Carbon Society, which focuses on theThree Ecos initiatives and the development of innovative new iron and steelmaking processes. Under the initiative, theJISF plans to reduce emissions by 3 million t-CO2 compared to the BAU (Business As Usual emissions: Estimated level ofemissions in the absence of any special measure) by FY2020 and by 9 million t-CO2 by FY2030. JFE Steel is aggressively
pursuing activities toward these goals.
In addition, JISF has formulated and announced its long-term vision for climate change mitigation in 2030 andbeyond, which is intended to realize zero-carbon steel. JFE Steel played an important role in formulating this vision.
Furthermore, in 2021, the JISF announced the “Basic Policy of the Japan steel industry on 2050 Carbon Neutrality aimedby the Japanese government,” declaring that the Japanese iron and steel industry will boldly take on the challenge ofrealizing zero-carbon steel.
The JFE Group intends to increase sustainability through solutions that address global climate change issues while
restructuring its business to respond to developments in the environment facing the steel business. We regard the 2020
to be the landmark year to further reinforce our efforts to tackle the climate change issues, and we declared our target
to reduce the CO2 emissions in FY2030 by 20% or more compared to FY2013 and to achieve carbon neutrality by 2050.
In 2021, the JFE Group has positioned its initiatives on climate change as a top priority issue and, as part of its
Seventh Medium-Term Business Plan, has formulated the JFE Group Environmental Vision for 2050, under which we will
aim to achieve carbon neutrality by 2050. The Group also disclosed a new CO2 reduction target. Major Group companiesof JFE Steel have formulated CO2 reduction targets on the same level as JFE Steel’s. The Group companies in Japan andoverseas work together to incorporate efforts to address climate change issues into the business strategy. By reflecting
the TCFD’s principles in their management strategies, the Group will systematically promote to reduce CO2 emissions.

JFE Group’s Initiatives to Reduce CO2 (the JFE Group Environmental Vision for 2050)
Seventh Medium-term Business Plan Initiatives■ Reduce steel-business CO2 emissions in FY2024 by 18% compared to FY2013 (JFE Steel).
Furthermore, JFE Steel’s major group companies have also set their own CO2 reduction targets for FY2024 toensure that these targets are achieved. With this, more than 99% of the total CO2 emissions of the entire JFE
Steel Group is accounted for.
■ The target of reducing CO2 in FY 2030 : 30% or more compared to FY2013 (JFE Steel)Initiatives for Carbon Neutrality by 2050
■ Reduce CO2 emissions at JFE Steel-Pursue super-innovative technologies mainly for carbon-recycling blast furnaces and CCU-Develop hydrogen-based ironmaking (direct-reduction) technology■ Expand engineering business contributions to CO2 emissions reduction in society-Reduce CO2 emissions by 12 million tonnes in FY2024 and 25 million tonnes in FY2030.
■ Offshore wind-power generation business-Accelerate commercialization of our offshore wind-power business by applying the strengths of the Group.
JFE Group Environmental Vision for 2050, Presentation Material(https://www.jfe-holdings.co.jp/en/investor/zaimu/g-data/2020/May2021-210525-release01.pdf)

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Editorial
PolicyCO2 Emissions of the JFE Group■ CO2 Emissions of the JFE Group■ Scope1 ■ Scope2(Million t-CO2)
80

64.3
60

40

62.2
61.8
60.4
59.9
7.4
6.7
7.6 53.2
7.6

55.0

54.9

52.3

52.9

6.5
46.6

20

0

2013

2016

2017

2018

2019

2020

(FY)

Data cover 76 companies
JFE Steel and 30 major domestic and overseas subsidiaries
JFE Engineering and 10 major domestic subsidiaries
JFE Shoji and 33 major domestic and overseas subsidiaries
Notes:-Data for JFE Steel include CO2 emissions from non-energy sources.
-Starting with FY2018, data for JFE Steel’s subsidiaries and JFE Engineering’s subsidiary include CO2 emissions from
non-energy sources.
-Data from FY2013 to FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
■ Scope 3 Emissions of the JFE Group (FY2020)
Categories 3, 4, 5, 6, 7:
Other 1,190

Category 1:
Purchased goods and services
11,026

Category 15:
Investments 927
Category 2:
Capital goods
1,226

Total

14,369thousand t-CO2

Coverage:(Categories 1, 2, 3, 4, 5) JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, and JFE Shoji(Category 6, 7) JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, 10 JFE Engineering domestic
subsidiaries, and JFE Shoji(Category 15) Japan Marine United, and 9 JFE Steel equity-method affiliates (7 domestic and 2 overseas)
Sources: Green Value Chain Platform (Ministry of the Environment) and others

For more on quantitative data related to CO2 emissions, refer to the following information.
Environmental Data (P.198)
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IndicesT JFE Steel

Initiatives to Save Energy and Reduce CO2
JFE Steel has always aggressively pursued CO2 reduction and energy savings, including the introduction of energy-saving
equipment.

Energy Consumption and CO2 Emissions in FY2020■ Production of Crude Steel of JFE Steel
29.39(MT/year)
30

28.76

28.46
26.31

25

26.73

23.55

22.76

-3%

20

0

1990

2013

2016

2017

2018

2019

2020

(FY)

Note: F igures for FY2013 to FY2016 included data for JFE Bars
& Shapes Corporation’s Sendai Works.
■ Energy Consumption and Unit Energy Consumption of
JFE Steel■ Energy consumption ● Unit energy consumption(GJ/t-s)

(PJ)
800

600

670

32

662

644

641

620

613

545

28.5

29

-16%

400

26

200

0

22.5
1990

2013

22.6

22.3
2016

2017

23.3

2018

23.2
2019

24.0

2020 (FY)230

Note: F igures for FY2013 to FY2016 included data for JFE Bars
& Shapes Corporation’s Sendai Works.

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ESG Data■ CO2 Emissions from Energy Sources and Unit CO2
Emissions of JFE Steel■ Scope1(Million t-CO₂)
100

2.48

■ Scope2 ● Unit CO₂ emissions from energy sources (t-CO₂/t-s)

1.98

-16%

2.03

2.03

1.99

1.94

2.08

80

58.3

58.1
56.6
55.7
54.2
53.5
5.6
6.1
4.9
6.3 47.3
6.2

60
40

52.5

50.8

50.5

47.3

47.9

2.5
2.0
1.5

5.4
41.9

20

1.0
0.5

0

1990

2013

2016

2017

2018

2019

2020 (FY)0

Notes:-The CO2 emissions and emission intensity in FY2020 are
calculated using the CO2 emission factor for electricity
purchased in FY2019, adopted by the Japan Iron and SteelFederation’s Commitment to a Low Carbon Society.
-FY2019 data was revised by applying the CO2 emission factor
for electricity purchased in FY2019, adopted by the Japan Iron
and Steel Federation’s Commitment to a Low Carbon Society.
-Figures for FY2013 to FY2016 included data for JFE Bars &Shapes Corporation’s Sendai Works.

E

N JFE Engineering■ JFE Engineering Group’s CO2 Emissions from Energy Sources(Thousand t-CO2)
100

72.3
62.9

75

66.7

67.5

62.5

56.5

Other

8.8

J&T
Recycling

39.7

JFE
Engineering

14.1

50

25

0

2013

2016

2017

2018

2019

2020

Note: Data cover JFE Engineering and 10 consolidated
subsidiaries in Japan.

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Indices■ JFE Engineering’s Contribution to CO2 Emission Reductions (FY2020)
Overseas*2: 5.24

Japan*1: 4.40

Waste (overseas): 2.24

Biomass (Japan): 1.87

Total:
9.65 million
t-CO2

Fuel conversion:
1.08

Waste (Japan):
1.13
Geothermal: 1.10

Waste heat recovery:
1.06
Other (solar, wind,digestion gas, waste heat): 0.29

Biomass (overseas): 0.86

*1 Data covers JFE Engineering*2 Data covers Standardkessel Baumgarte GmbH (SBG), a
German subsidiary of JFE Engineering CorporationS

H JFE Shoji

Under the environmental strategies formulated in 2001, JFE Shoji offices in Japan have consistently worked to reduce
its use of energy and paper as well as strictly manage waste separation.
Efforts to cut energy consumption such as leave-on-time days, prohibition of night work, and pinpoint lighting havebecome firmly rooted. Continuous efforts are also made to improve the working environment through 5S activities andto raise operational efficiencies through robotic process automation (RPA). These efforts are contributing to reducing
JFE Shoji’s environmental impact. In FY2020, because employees worked from home due to the coronavirus pandemic(COVID-19), the electricity consumption at its offices decreased.
For some time now, the company has also been distributing pocket-sized cards to all employees, which describe its
environmental policy, fiscal year targets, and environmental initiatives related to office and trading activities, in order toraise employee awareness of environmental activities.

■ Electric Power Consumption by JFE Shoji(Thousand kWh)
2,500

2,031
2,000

-58％

1,500

1,060

1,000

915

899

918

919

843
Branch offices
Nagoya office5000Osaka office
Head office(Tokyo)

2001

2013

2016

2017

2018

2019

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35
224

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Indices■ CO2 Emissions of the JFE Shoji Group (FY2020)
China: 11.1 thousand

North and Central
America:
4.4 thousand
Asia:
4.5 thousand

Total:
29.6 thousand
t-CO2

The graph shows CO2 emissions from electric
power consumption by JFE Shoji and 33
consolidated subsidiaries (steel-processing
companies) in Japan and overseas.

Japan:
9.6 thousand

Endorsing and Participating in External Initiatives
The JFE Group expresses its views and opinions on various public policies and external initiatives related to climatechange and environmental conservation through Keidanren (Japan Business Federation) and the Japan Iron andSteel Federation (JISF), and it proactively participates in these activities. The Group also endorses the Challenge Zerodeclaration and will rise to the challenge in pursuit of innovation. Challenge Zero (Innovation Challenges Towards a Net
Zero Carbon Society) is a new joint initiative by Keidanren and the Japanese government for proactively publicizing andsupporting companies and organizations that pursue innovative actions toward realizing a decarbonized society, which is
the long-term goal of the Paris Agreement.
The Japan Iron and Steel Federation (JISF) is committed to the achievement of a low carbon society with thetarget year of FY2030. In November 2018, the JISF also formulated and published the Long-term Vision for Climate
Change Mitigation for 2030 and beyond, which represents the industry’s challenge toward realizing zero-carbon steel.
Furthermore, in February 2021, the JISF announced the “Basic Policy of the Japan steel industry on 2050 Carbon
Neutrality aimed by the Japanese government,” declaring that the Japanese iron and steel industry will boldly take on thechallenge of realizing zero-carbon steel. As a member of the JISF, JFE Steel will be actively involved in these mediumand long-term climate change initiatives. JFE Steel is also participating in international activities, such as the Japan India
Public and Private Collaborative Meeting, Japan-ASEAN Steel Initiative, and Japan-China Steel Industries Exchange.
Furthermore, it is a member of the World Steel Association (WSA)’s Climate Action Program, which uses ISO 14404 as
the standard for measurement and calculation.
JFE Engineering is a member of the Japan Climate Leaders’ Partnership (JCLP). The JCLP, established in 2009, is acoalition of Japanese corporations that urge the industrial community to develop a sound sense of urgency on the issueof climate change and to initiate more proactive actions toward the goal of creating a sustainable, decarbonized society.
By leading the transition to a decarbonized society, companies aim to fulfill their social responsibilities. JFE Engineering,
together with the JCLP, will actively engage in a variety of activities that go beyond the boundaries of the company, torealize a sustainable, decarbonized society.
For more details, refer to the following.
Steel Industry Initiatives (P.90)
Initiatives by industry groups
The Japan Iron and Steel Federation: Climate Change Policy (https://www.jisf.or.jp/en/activity/climate/index.html)
The Japan Iron and Steel Federation: Challenge Toward Zero-Carbon Steel (Japanese only)(https://www.jisf.or.jp/business/ondanka/zerocarbonsteel/index.html)

Keidanren (Japan Business Federation): Challenge Zero (https://www.challenge-zero.jp/en/)Japan Climate Leaders’ Partnership (JCLP) (https://japan-clp.jp/en)
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Scenario Analysis in Line with the TCFD Recommendations
The JFE Group intends to achieve carbon neutrality by 2050. The Group leverages the scenario analysis in line with
the TCFD recommendations to identify and assess climate change-related risks and opportunities and to strengthen
the resilience of its organizational strategy. Please refer to the “Climate Change” page for governance, strategy, risk
management, metrics and targets for climate change-related issues in line with the TCFD recommendations.
Climate Change (P.55)

Milestones Related to Climate Change around JFE’s Business and JFE’s Initiatives
1997
2008
2013
2015
2017
2018
2019

Kyoto Protocol adopted at COP3 in Kyoto
JISF’s Voluntary Action Plan launched
JISF’s Commitment to a Low Carbon Society launched
Paris Agreement adopted at COP21
TCFD published the final report of its recommendations
JISF announced the Long-term Vision for Climate Change Mitigation, Zero Carbon SteelJFE Group announced its endorsement for the final report of the TCFD recommendations
JFE Group published a scenario analysis in line with the TCFD recommendations
2020
Keidanren launched the Challenge Zero initiative	Ministry of Economy, Trade and Industry published a list entitled Companies Taking on the Zero-Emission
Challenge
JFE Group published its targets in its medium- to long-term vision (target for 2030 and achieving carbon
neutrality by 2050)
Prime Minister Suga declared Japan will achieve carbon neutrality by 2050
2021	JISF announced the Basic Policy of the Japan steel industry on 2050 Carbon Neutrality aimed by the Japanese
government
JFE Group published its roadmap for achieving carbon neutrality in 2050 in the JFE Group
Environmental Vision for 2050
Japanese government formulated the Green Growth Strategy Through Achieving Carbon Neutrality in 2050
The Challenge Zero (Innovation Challenges Toward a Net Zero Carbon Society) is a new joint initiative by Keidanren(Japan Business Federation) and the Japanese government for proactively publicizing and supporting companies andorganizations that pursue innovative actions toward realizing a decarbonized society, which is the long-term goal of theParis Agreement.
The JFE Group endorses the Challenge Zero declaration and will rise to the challenge in pursuit of innovation.
The Ministry of Economy, Trade and Industry (METI), in collaboration with Keidanren and the New Energy and Industrial
Technology Development Organization (NEDO), has been tackling a project called the Zero-Emission Challenge. This is
to prepare a list of companies generating innovation toward realizing a decarbonized society and to provide investors andother stakeholders with useful information on these companies. On October 9, 2020, on the occasion of TCFD Summit
2020, Mr. Kajiyama Hiroshi, Minister of Economy, Trade and Industry, published a list entitled Companies Taking on the
Zero-Emission Challenge, which includes a total of about 300 named and unnamed companies. The JFE Group wasselected for the category “Companies Taking on the Zero-Emission Challenge.” These are organization who are boldly
accepting the challenge of innovation to realize a decarbonized society.
The JFE Group publishes information on specific initiatives through the following website.
Challenge Zero (https://www.challenge-zero.jp/en/member/34)
Zero-Emission Challenge (https://www.meti.go.jp/english/press/2021/1005_002.html)
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Scenario Analysis
Tools and Methods
Scenario analysis is performed to provide an accurate understanding of climate-related risks and opportunities andassess implications to the current business strategy, thereby enabling the organization to establish business strategies
that reflect this assessment. We selected the following two scenarios by considering the fact that our business has
potentially high exposure to the impacts of climate change.
Both scenarios are based on those developed by the International Energy Agency (IEA). Analysis is conducted under theassumption that a uniform carbon price is implemented in major emitting countries toward the realization of the 2°C target.
For the long-term scenario analysis, we set our goal as achieving carbon neutrality by 2050. We conducted risk
assessments that take into account the prospect of achieving the 2°C scenario and the necessity of super-innovativetechnology for the 1.5°C scenario (IPCC 1.5°C Special Report) in steelmaking for carbon neutrality by 2050.

Selected Scenario

2°C Scenario

4°C Scenario

Transition
Risks

Transition scenarios developed by the
IEA·S ustainable Development Scenario(SDS)*1·2
 °C Scenario (2DS)*2

Transition scenarios developed by the
IEA· New Policies Scenario (NPS)*1· Reference Technology Scenario(RTS)*2

Physical
Risk

Climate change projection scenario developed by the Intergovernmental Panelon Climate Change (IPCC)·R epresentative Concentration Pathways (RCP) Scenario*3

Reference
Scenario

How Society will Look

Dynamic policies will be adopted andtechnical innovations will progress
to limit the average temperature riseby the end of this century to 2°C andrealize sustainable development.
Assume a society in which ourbusiness is affected by socialchanges accompanying transition to a
decarbonized society.
·W orld-wide/industry-wide uniform
carbon pricing*4· Increase in the ratio of sales ofelectric vehicles to overall vehicle
sales

Despite new policies implemented ineach country based on approaches
under the Paris Agreement, averagetemperature rises about 4°C by theend of this century.
Assume a society in which ourbusiness is affected by temperaturerise and other climate change.
· Increase in the occurrence offlooding· Sea level rise

*1 S
 ource: IEA “World Energy Outlook 2018”*2 S
 ource: IEA “Energy Technology Perspectives 2017”*3 S
 ource: IPCC Fifth Assessment Report*4 If prices of carbon differ from country to country, there will be a gap in international competitiveness between
countries that impose strict CO2 emissions regulations and less strict regulations. This will result in carbon leakage
where CO2 emissions of a strict climate policy country are reduced due to decreased production and investment,
while production at and investment to other countries with laxer emission constraints increase, in turn increasing
the CO2 emissions in those countries. One reference scenario, SDS, assumes that carbon pricing is implemented
in developed countries and some developing countries. By taking this into account, we formulated the 2°C scenario
based on the assumption that a uniform carbon pricing is introduced to major emitting countries to push towardachieving the target of two degrees.
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Scope of Business and Period for Analysis
This analysis covers the following businesses: the steel business by JFE Steel, the engineering business by JFE
Engineering, the trading business by JFE Shoji, and businesses carried out by some of the other Group companies. The
period covered is up to 2050.

Relevance with JISF’s Long-term Vision for Climate Change Mitigation
The JFE Group’s steel business is led by its operating company, JFE Steel. JFE Steel is a member of the Japan Iron andSteel Federation (JISF), which has committed to the achievement of a low carbon society with the target year of 2030.
In November 2018, the JISF also formulated and published the Long-term Vision for Climate Change Mitigation for 2030
and beyond. JFE Steel played a central role in the formulation of this long-term vision. The vision represents the industry’s
challenge toward realizing zero-carbon steel and lays out the prospect of achieving the 2°C scenario for steelmaking andnecessity of super-innovative technologies to achieve the 1.5°C scenario. Furthermore, on February 15, 2021, the JISF
announced the “Basic Policy of the Japan steel industry on 2050 Carbon Neutrality aimed by the Japanese government,”
which declares that the Japanese iron and steel industry will boldly accept the challenge of realizing zero-carbon steel.
The JFE Group’s scenario analysis is intended to ensure resiliency in our Group’s business strategy during theintermediate stages of these long-term challenges.
■ Efforts to Achieve Zero Carbon Steel
2020
Development of Technologies Specific to
the Iron and Steel Sector

COURSE50

Raising ratio of H2 reduction in blast furnace
using internal H2 (COG). Capturing CO₂ from blast
furnace gas for storage.

Super COURSE50

Further H2 reduction in blast furnaces by adding H2from outside (assuming massive carbon-free H2 supply
becomes available)

H2 reduction
ironmaking

H2 reduction in iron making, which does not use coal

CCU

Carbon recycling from byproduct gases

CCS

Recovery of CO₂ from byproduct gases

2030

R&D

2040

2050

2100

Implementation

Implementation

R&D

R&D

R&D

R&D

Implementation

Implementation

Implementation

Development of Common
Fundamental Technologies
for Society

Carbon-free Power

Carbon-free power sources (nuclear, renewables,
fossil + CCS) Advanced transmission, power
storage, etc.

Carbon-free H2Technical development of low-cost, high-volume
hydrogen production, transportation, andstorage

R&D

Implementation

Technical development of CO₂ Capture,
Utilization and Storage

R&D

Implementation

CCS／CCU

R&D

JISF’s Zero-Carbon Steel (https://www.zero-carbon-steel.com/en/)

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Process to Identify Key Factors that Impact the Business
STEP 1: Examine the entire value chain from a holistic perspective and sort out factors that impact the businesses underanalysis (for more information on risks and opportunities in the value chain, refer to:
JFE Group Value Chain (P.32))
STEP 2: Examine all factors at an overview level and identify key factors by taking into account the level of impact andstakeholder expectations and concerns
2°C Scenario

4°C Scenario

5. Unstable raw materials
procurement due to increased
occurrence of climatic hazards

Impact on Procurement

Impact on Direct Operation

1. D ecarbonization of iron andsteelmaking process
2. Increased needs for effective
utilization of steel scrap

6. Damage to production bases andoffices caused by climatic hazards

Impact on Product andService Demand

3. C hange in demand for automotive
steel, etc.
4. Increase in demand for solutions toenhance decarbonization

7. National resilience

Level of Impact

Expectations and concerns of stakeholders

Axis for identifying key factors

Axis for identifying key factors: • Level of impact (possibility of risks and opportunities arising × Level of impact if it
manifests)• Expectations and concerns of stakeholders

Results of Scenario Analysis
For the JFE Group, the issue of climate change is a critical managerial concern from the perspective of business
continuity. Our steel business, which emits 99.9% of the Group’s total CO2 emissions, has been developing various
technologies for saving energy and reducing CO2 emissions. We have actively addressed the risks by applying thesetechnologies to steel manufacturing and have also successfully reduced CO2 emission intensity to the lowest level
worldwide. We will continue to develop processes to reduce environmental impact further while at the same timeseeking to turn this challenge into an opportunity for addressing climate change issues by deploying the technologies wehave fostered across the globe.
The JFE Group has developed and maintained a variety of eco-friendly products and technologies, including highperformance steel materials that help save energy when customers use them, as well as renewable energy power
generation. We view the current challenges as an opportunity and are contributing to solving the climate change problem.
Automobiles are expected to become lighter in weight while the number of electric cars increases. We will support thisby improving the functions of the JFE Group’s high tensile strength steel sheets and electrical steel sheets. In addition,
we will help reduce our carbon footprint by further disseminating renewable energies and implementing recycling
initiatives as well as energy conservation.
To achieve the long-term goal of the Paris Agreement, to keep the global average temperature increase well below
2°C compared to pre-industrial levels and to strive to limit it to 1.5°C, the Group will continue to develop and disseminate
new technologies and contribute to the prevention of global warming. We will also support national resilience by
providing steel for social infrastructure and construction to address the emerging risks associated with the growing
severity of meteorological disasters.
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PolicyAnalysis Results
Stakeholder Expectations
and Concerns for
the JFE Group

Changes in Society and Response➡

Opportunity

2°C Scenario

Key Factor 1
Increasing social
demand for
decarbonized iron andsteelmaking process

Implement innovativetechnology to realize
decarbonation at alarge scale➡

Increasing volumeof scraps generated

Opportunity

Shift in demand forautomobiles

Key Factor 3

Cars are lighter inweight and use multimaterials

Change in Demandfor Automotive Steel

Demand for
decarbonization and highrecyclability

Risk

Increase in Demandfor Solutions
to Enhance
Decarbonization

Transition to
decarbonized society
Overseas expansionof energy-saving
technologies

Expansion in scrap
logistics business
Increase in demand forelectrical steel sheets due toincrease in electric vehicles
Increase in demand
for special steel due toincreased car sales
Increase in demand for hightensile strength automotive
steel sheets
Recyclability of steel isgaining attention againmaterials is limited

Opportunity➡

Key Factor 4

Expansion in electric
furnace steelmaking andelectric furnace engineering

Entire construction andoperation of renewableenergy plants (biomass,
geothermal, and solar
power generation)
Entire construction andoperation of incineratorsand plastic recycling plants➡

2°C Scenario• Renewable energy power
generation plant• Promote low-carbon
business, or eco
solutions, in developing
countries using best
available technologies(BAT) developed and put
into practical use in Japan

Converter furnace steelmaking
is increasing due to constraint
on the supply of scrap

Entire construction of
CCU/CCS facilities➡

Increasing demand
for solutions topromote thetransition

Operating cost increases(if carbon pricing is notproperly introduced)➡ Effect of trend to use multi-➡

Increasing demand for
eco-friendly materials

Opportunity➡

2°C Scenario

Decreasing demandfor internal-combustion
engines• Increase in demand forelectrical steel sheets for
EV motors• Decrease in demand
for special steel due
to decreased demandfor internal-combustion
engines• Alternative steel material
for automobiles to meet
the trend of using multimaterials• Demand to improve
decarbonization andrecyclability of steel➡

Increasing demandfor EV motors➡

➡

Increased Needs for
Effective Utilizationof Steel Scrap

Increasing interestfor electric furnace
method for its lower
CO2 emissions• Electric furnace as analternative to converter
furnace• Expanding electric furnacesteelmaking within the
JFE Group➡

Key Factor 2

Increasing
expectations forelectric furnace steel

Investment on implementing
innovative technologies is feasible
will be maintained throughimplementation of a uniform
carbon price across all countries➡

2°C Scenario

Develop and put into
practical use innovativetechnologies in addition
to existing ones

➡ The Group’s cost competitiveness

Risk

➡

Introduce carbon price• Significantly contribute
through innovativetechnologies• Increase in investment
to implement innovativetechnologies• Increase in operating
costs due to introductionof carbon pricing➡

Decarbonizationof Iron andSteelmaking Process

Results of Assessment

Overseas expansion of
low-carbon business

4°C Scenario
Unstable Raw
Materials
Procurement due toIncreased Occurrenceof Climatic Hazards

Increasingly
devastating climate
hazards caused bytemperature rise

Risk

Raw materials
procurement
becomes unstable

4°C Scenario

Key Factor 6
Damage to
Production Bases andOffices Caused by
Climatic Hazards
4°C Scenario

Key Factor 7
National Resilience• Increase in damage
caused by typhoons andheavy rain
• Increase in damage
caused by drought• Flooding caused by sea
level rise

Increasingly devastating climate hazards causedby temperature rise

Increasingly
devastating climate
hazards caused bytemperature rise

➡ Ongoing specific measures:
Diversify supply sources,
strengthen capabilities offacilities• Raw material procurement
becomes unstable

Increasing theimportance of enhancing
infrastructure
Increasing demandfor disastermitigation products• Contribute to reinforcing
infrastructure withsteel and other relevant
products

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➡ Measures against floodand drought are already inprogress

Risk➡ Impact of flooding causedby sea level rise can beaddressed with current
countermeasures

Opportunity➡

Key Factor 5

Reinforce infrastructurewith steel and otherrelevant products

Guideline
IndicesMessage fromthe CEO

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ESG Data

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PolicyGuideline
Indices

Overview of a Scenario Analysis Assessment
Timeframe:

Mid-term⇒until 2024,

2030⇒until 2030,

2050⇒until 2050 (final)

FOCUS Key Factor (1) Decarbonization of Iron and Steelmaking Process
We are developing innovative technologies to emerge as the pioneer in realizing a decarbonized society.
With a strong financial base to meet investments for implementing innovative technologies, we are
significantly contributing to the transition to a decarbonized society.
Mid-term, 2030
JFE Steel has been committed to developing energy-saving technologies toward increasing the efficiency of the ironand steelmaking process and decarbonization. These initiatives have helped JFE Steel acquire technologies that realize
the world’s top energy efficiency in iron and steelmaking. To further push ahead with decarbonization, the Company will
enhance the development of innovative ironmaking processes such as COURSE50 and ferro coke, which are expected
to reduce the carbon footprint through hydrogen reduction and CCS.
Mid-term, 2030, 2050
COURSE50 applies hydrogen reduction technology and CCS to reduce CO2 emissions by about 10% and 20%,
respectively, through each technology, for a total reduction of about 30%. The first facility is expected to come online
by 2030, followed by the implementation of other plants by 2050, corresponding with the timing for upgrading blast
furnace facilities. Ferro coke is a technology for significantly reducing CO2 emissions by improving the reduction rate ofiron ore put into blast furnaces. In addition to these technologies, we will push forward to establish a hydrogen reduction
ironmaking technology which we will aim to put it into practice after 2030 in order to realize the ultimate goal of creating
zero-carbon steel.
We consider implementing innovative technologies as critical and will advance with this strategy together with thegovernment. Furthermore, we have a sufficient financial base to meet necessary investments.
A medium-scale pilot plant with the capacity to produce 300 tonnes of ferro coke per day was constructed in the
Fukuyama district of the JFE Steel West Japan Works, and experimental runs began in October 2020.
■ Example of Developing an Innovative Technology:
Ferro Coke Production Process
Low-gradeiron ore

Low-gradecoal

Expandingthe use of
low-gradematerials

Dry distillation
furnace
Crusher

Mixer

Up to 10%energy savings

Reduction ofcarbon materials
Conventional
furnace coke

Briquetting
Dryer

Briquette

Ferro-cokeproduction 300
tons daily

2050
In the long term, we will develop carbon recycling blast furnaces (CR blast furnaces), hydrogen steelmaking, and electric
furnaces while striving to achieve carbon neutrality by 2050, as stated in the JFE Group Environmental Vision for 2050. In
particular, we have been focusing on a technology that combines a CR blast furnace with CCU. This is a super-innovativetechnology that targets net zero CO2 emissions by drastically reducing CO2 emissions from the blast furnace process,maximizing its ability to efficiently produce high-grade steel in mass volume, and enabling CO2 reuse in the blast furnace.
The remaining CO2 that cannot be fully reused in the furnace will be further reduced by manufacturing basic chemicals
such as methanol.
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Cost competitiveness will be maintained in case uniform carbon pricing is introduced across all countries.
Mid-term, 2030
Various approaches to carbon pricing have been introduced around the world, and in Japan as well the analysis for carbon
pricing such as carbon taxes and emissions trading has started toward achieving carbon neutrality by 2050. In Europe, aborder adjustment tax is also being discussed.
If uniform carbon pricing is introduced to major emitting countries, the increase in operating cost will bereflected reasonably on the price of steel products both in Japan and overseas, thus maintaining the Company’s costcompetitiveness. In addition, since CO2 emissions per unit of steel production is the lowest of all competing materials,
steel retains its superior position in cost competitiveness.
On the other hand, the introduction of carbon pricing in a manner that is biased toward certain regions, industries,
or countries such as Japan would have a major impact on the JFE Group and particularly on its steel business as thiswould further increase the current price of electricity, which is already high in Japan compared to other countries. It may
cause the Company to lose its cost competitiveness and may even inhibit innovation and hinder the realization of carbon
neutrality. As carbon pricing is introduced, we will need to monitor emerging trends closely in order to see whether it will
truly contribute to growth.

FOCUS Key Factor (2) Increased Need for Effective Utilization of Steel Scrap
To achieve carbon neutrality, we are focusing on high-grade steel manufacturing and raising efficiency
by applying our industry-leading electric furnace technology. Furthermore, we will open up opportunities
for the entire JFE Group by expanding the use of our electric furnaces, increasing the use of our electric
furnace construction technology, and expanding scrap logistics.
Mid-term, 2030, 2050
The JISF predicts that the demand for crude steel will continue to grow as the world’s population increases andthe economy develops and that both the blast furnace and electric furnace methods will be indispensable as major
steelmaking processes (JISF's Long-term Vision for Climate Change Mitigation). To achieve carbon neutrality, we need to
expand the production of steel products using the electric furnace method, which emits less CO2. For this to happen, we
need to work on technologies that improve the productivity of electric furnaces and address the constraints in producing
high-grade steel products. We must also work on technologies that increase the amount of scraps used in converter
furnaces.
The JFE Group is viewing the increase in demand for electric furnace steel as well as the world-wide increase in theamount of scrap generated as an opportunity, and it will enhance its electric furnace steel production while applying its
engineering technology for constructing an entirely cutting-edge, energy-saving electric furnace facility with the ultimate
goal of opening up other business opportunities. Moreover, the■ Estimated Supply and Demand for SteelGroup will advance the development of technologies to utilize
Production and Scrap Use
scrap and increase the industry-wide use of this material.
Crude steel production
Meanwhile, expanding the use of scrap will bring about an
Pig iron production
Scrap consumption
increase in logistics for distributing it, and this will provide an(Billion tonnes)
2.68
3.0
opportunity for JFE Shoji to expand its logistics business.

2.0

1.62

1.0

1.22

1.55
1.40

0.56
0

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2015

2050

(Year)

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FOCUS Key Factor (3) Change in Demand for Automotive SteelThe shift to EVs is accelerating as new and stricter environmental regulations are being introduced
globally at a faster pace. Demand for electrical steel sheets for EV motors as well as special steel isincreasing as global car sales rise. The increase in the intensity of high tensile strength automotive steel
sheets contributes to further weight reductions.
Mid-term, 2030, 2050
The trend of increasing electric vehicles has given rise to rapidly expanding demand for electrical steel sheets used in EV
motors. JFE Steel has already marketed the JNE series of non-oriented electrical steel sheets, used in building motors,
as part of its eco-product lineup. It also commands a strong share of the market.
On the other hand, it has been pointed out that an increase in EVs may lead to a decline in the amount of special
steel used in engine components. The amount of this type of steel, used in hybrid vehicles and electric vehicles, is 80%
and 60% of gasoline cars, respectively. We believe that the risk level for this matter, however, is low since car sales are
expected to increase even under the 2°C scenario and total demand for special steel for cars is increasing.
Nonetheless, the situation for EV remains the same in terms of strong demand for weight reduction of bodystructure. JFE Steel has developed a cold-rolled steel sheet boasting 1.5 GPa-grade tensile strength as an eco-productand has put it into practical use as an automotive steel sheet. With its high strength, the product can significantly reduce
the weight of a car frame. In response to customer needs for more environmentally sound options, we intend to expand
its application and further increase its strength, thus dramatically reducing CO2 emissions from cars in motion.

■ Estimated World Demand for Automotive
Special Steel■ Estimated World Demand for Automotive
Electrical Steel Sheets

1.5

10

1.17
1.00

1.11

1.13

7.38

1.0

4.44

5

2.67

0.5

1.00
0

2020

2030

2040

2050

(Year)

0

2020

2030

2040

2050

(Year)

Vertical axis: Steel demand (comparison by year with the year 2020 as 1.00)
Source: Estimated by JFE Holdings based on reports by Strategic Commission for the New Era of Automobiles (METI)

Steel demand will increase due to renewed interest in its highly recyclable quality, essential for
decarbonization.
Mid-term, 2030, 2050
Steel is a highly recyclable material that can be reborn as many different products over and over again with no loss in
its intrinsic quality. In the future, public resource recycling is expected to increase toward establishing a decarbonizedsociety. We believe that the high recyclability of steel will gain attention once again in light of this transition.

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Effect of trend to use multi-materials is limited.
Mid-term, 2030, 2050
Aluminum and carbon fiber reinforced plastic are potential alternative materials for reducing the weight of cars. It has
been pointed out, however, that the production cost of these materials and the amount of CO2 emitted throughout theirlife cycles is higher than those of steel. Therefore, under the 2°C scenario, which assumes the introduction of a carbon
price, the price differential between steel and alternative materials will be larger. Under this scenario, while the trend ofusing multi-materials may show some progress for luxury cars, their use would be limited for economy cars. Moreover,considering a situation in which all panels used for doors and other parts of a luxury car were changed to aluminum,
the effect on weight reduction could be expected to be 5% of all materials used in luxury and economy cars together.
Multiplied by the number of cars produced, the impact over the total demand for automotive steel can be assumed to belimited.
In the meantime, JFE Steel has developed a multi-material structure that uses a small amount of fiber resin to
maximize steel quality. In this new structure, a highly ductile, strong adhesive resin is sandwiched between a bodypart made of an ultra-high strength steel plate and a part made of a thin steel plate. This structure is capable of further
reducing the weight of automobile frame parts and also improving collision safety performance.
We will continue developing and proposing various products and technologies that meet customer needs.
An energy-absorbing structure made of ultra-high strength steel and a small amount of resin (P.99)

FOCUS Key Factor (4) Increase in Demand for Solutions to Enhance Decarbonization
Contribution through the provision of solutions (renewable energy power generation, Multisite Energy Total
Service, recycling business, carbon-recycling technologies and energy-saving steel technologies)
Renewable Energy Power Generation

Mid-term, 2030, 2050

Demand for power generation plants using non-carbon emitting renewable energies is expected to increase. The JFEGroup engages in designing, procuring, constructing, and operating biomass*1, geothermal*2, solar*3, 4, and onshore
wind power generation plants in its engineering domain.
We will also work on offshore wind power generation, which the Japanese government has positioned as one ofthe pillars of its Green Growth Strategy to achieve carbon neutrality by 2050. JFE Engineering will drive this by entering
into the business of manufacturing seabed-fixed structures (monopiles, etc.). JFE Steel will contribute by increasing the
supply of large and heavy steel plates, and JFE Shoji will assist by establishing SCM, which includes information sharing
between Taiwan, who is leading the offshore wind power generation market, and East and Southeast Asian countries,
which are future regions of demand. We will also work on the O&M*5 that makes maximum use of Group resources.
Furthermore, from the perspectives of resource recycling and effective use of resources, we are making efforts toincrease power output at waste processing facilities. JFE Engineering is striving to develop a fully automated operation*6
to facilitate higher power output at incinerators.
(2020: six facilities → 2021: additional four facilities are scheduled. More to follow.)
Moreover, we are utilizing renewable energy as the main power source for our retail electricity business*7 and in
helping to establish and operate regional electricity retail companies*8, 9 focused on local production and consumption ofelectricity based on renewable energy.
(2020: 8 locations → FY2024: targeting around 10 locations → 2030: targeting around 20 locations)(Amount of contribution to CO2 reduction resulting from renewable energy power generation: FY2020: 9.65 million
tonnes per year → FY2024: 12 million tonnes per year → FY2030: 20 million tonnes per year)

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Biomass power generation plant

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesWaste-to-energy power generation plant*1 The JFE Engineering Corporation’s Biomass (https://www.jfe-eng.co.jp/en/products/power/s02.html)*2 The JFE Engineering Corporation’s Power generation plant (https://www.jfe-eng.co.jp/en/products/power/gene01.html)*3 The JFE Engineering’s Solar power generation (Japanese only) (https://www.jfe-eng.co.jp/products/power/ele05.html)*4 The JFE Technos Corporation’s Solar power generation (Japanese only) (https://www.jfe-technos.co.jp/products/solar/)*5 Operation and maintenance*6 The JFE Engineering’s BRA-ING Pre-release (Japanese only) (https://www.jfe-eng.co.jp/news/2020/20200727.html)*7 Urban Energy Corporation’s Electricity retail business (Japanese only) (https://u-energy.jp/service/retail.html)*8 U rban Energy Corporation’s Regional electric power support business (targeting local governments)(Japanese only)(https://u-energy.jp/service/municipality.html)*9 Establishing regional electricity retail companies in partnership with local municipal governments (P.107)
Multisite Energy Total Service

Mid-term, 2030, 2050

In addition to the conventional service of optimizing energy use for single sites, JFE Engineering offers the Multisite
Energy Total Service (JFE-METS)*1, which optimizes energy use for multiple sites through centralized management.
We realize overall energy savings and CO2 reduction by analyzing energy consumption at multiple sites and achieving
total optimization by installing and operating energy-related equipment at each site to circulate energy throughout the
network, including remote locations.
*1 The JFE Engineering Corporation’s JFE-METS (Japanese only) (https://www.jfe-eng.co.jp/news/2019/PDF/20200130.pdf)

Recycling Business

Mid-term, 2030, 2050

We are working to reduce the use of new fossil fuel-derived materials by recycling waste plastics and food wastes. In
waste plastic recycling, in addition to the conventional recycling of plastic containers and packaging, we are actively
engaged in the so-called bottle-to-bottle business, in which we recycle finished PET bottles into new PET bottles,
demonstrating a complete resource recycling model for reducing CO2 emissions. In food recycling, we generate methanegas from disposed food wastes to create renewable energy (fuel gas and electricity). JFE Engineering undertakes theconstruction of recycling plants*1 from design to procurement and construction as well as operation, and J&T Recycling
Corporation operates a plastic recycling business*2.
Industry-wide decarbonization cannot be achieved only through technical developments in the manufacturing
process alone. Therefore, we believe that demand for CCU and CCS facilities will increase as they facilitate the efficient
use and storage of CO2. JFE Engineering is able to undertake the entire process of building CCU and CCS facilities fromdesign and procurement to construction.

*1 The JFE Engineering Corporation’s Recycling (https://www.jfe-eng.co.jp/en/products/recycle/rec01.html)*2 The J&T Recycling Corporation’s Recycling (https://www.jt-kankyo.co.jp/en/business/products/)
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Carbon-recycling Technologies

Environment

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Mid-term, 2030, 2050

JFE Engineering is working on a technology that uses CO2 from exhaust gas and waste plastics, collected and separatedusing its own technology, to produce synthesis gas (CO + H2) that can be used as raw materials for chemical products.
Since waste plastic is used as a source of hydrogen and energy, the company is able to achieve the carbon recycling of
CO2 and chemical recycling of waste plastic at the same time. We intend to commercialize this technology in 2024 as an
EPC (Engineering, Procurement, Construction) product, and we also anticipate using it in our own businesses.
(Amount of contribution to CO2 reduction made by the carbon recycling technologies: FY2024: 0 million tonnes per
year → FY2030: 1 million tonnes per year)

Energy-saving Steel Technologies

Mid-term, 2030

From the perspective of the steel industry, there is space for disseminating eco solutions (energy-saving steel
technologies) in nations such as China, where close to 50% of the world’s crude steel is produced, and India and ASEAN
countries, where further growth in production is expected. The potential CO2 reduction achieved by internationallytransferring and disseminating advanced energy-saving technologies widely used in Japan will exceed 400 million t-CO2
world-wide. Japan is estimated to contribute to the reduction of approximately 80 million t-CO2 in FY2030 through thesetechnologies.

FOCUS Key Factor (5) Unstable Raw Material Procurement due to Increased Occurrence of Climatic Hazards
Ongoing initiatives to address the issue, such as alternative procurement and dispersed supplier bases,
and increasing plant capacity.
Mid-term, 2030
In Australia, our major source country for raw materials, the occurrence of typhoons is predicted to double. We may bevulnerable in terms of continuous production and suffer a loss if production and shipping are interrupted for too long.
To address this issue, we are promoting alternative procurement and dispersed supplier bases.
Alternative procurement and dispersed supplier bases:
Respond to disaster by carrying out spot procurement from China’s port stocks, increasing procurement from closer
source countries such as Russia and Indonesia and front-loading the purchase and/or increasing the purchase contract
of different brands from outposts in unaffected regions of Australia. Also, use the stock and external yard of the Group
company Philippine Sinter Corporation.
The decarbonization in the steelmaking process is expected to lead to a diversification of the required raw
materials. We will take into account the risk of climate change for these materials also and work to establish diversified
procurement sources.

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FOCUS Key Factor (6) Damage to Production Bases and Offices Caused by Climatic Hazards
Measures against flood and drought in progress; impact of flooding caused by rising sea levels can beaddressed with current countermeasures.
Mid-term, 2030
We are taking action to minimize damage under the assumption that typhoons and heavy rains will become stronger andthat the occurrence of disasters comparable to the torrential rain in western Japan in 2018 will rise. We have currently
invested approximately 6.5 billion yen for disaster prevention at steelworks and strengthened drainage facilities and otherassets. About 3.5 billion yen of separate investment has already been made to prepare for water shortages at steelworks
by installing desalination facilities at some of the steelworks. Although no severe drought disaster has struck since the1994 disaster, we are preparing to minimize any damage even if the frequency of occurrence should increase.
All steelworks are exposed to the risk of floods associated with rising sea levels because of their location in coastal
areas. The estimated sea level rise by 2050 is 20 to 30 cm (70 cm by 2100 if the impact of climate change manifests
itself at the highest level.) We believe that current measures against storm surge, which generates more sea level rise,are sufficient to address the risk. However, we will continue analyzing climatic hazards going forward so as to prepare forthe changing circumstances.

FOCUS Key Factor (7) National Resilience
Contribute to infrastructure enhancement with products such as high-strength H-shaped steel and steel
pipe piles, hybrid tide embankments, and permeable steel slit dams.
Mid-term, 2030
The JFE Group takes seriously the increased frequency and severity of recent climatic hazards in Japan. Also, thedaily life of the Japanese citizenry is being exposed to a heightened risk of danger. The JFE Group defines its mission
as promoting disaster prevention and mitigation as well as national resilience to maintain vital infrastructure that are
essential to daily life and economic activities.
The JFE Group will gather its collective energy to protect key structures from earthquakes using structural steel
such as high-strength H-shaped steel and steel pipe piles as well as steel sheet piles. It will also help to reinforce
embankments that are prone to bursting and provide disaster prevention products such as hybrid tide embankments*1
and permeable steel slit dams, in addition to reconstructing infrastructure.
Hybrid Tide Embankments
Hybrid tide embankments are made of steel and concrete. Because of their hybrid structure, they require shorter
construction time and less space.
Concrete blocks for hybrid tide embankments are precast at a JFE Group factory, while steel pipe piles forfoundations are installed at the construction site, thereby reducing the time required for on-site construction by about
60%. This arrangement does not require large amounts of materials, equipment, or workers on site, so it does notinterfere with other construction work. Furthermore, compared to a conventional embankment structure, the land area
occupied by the embankment can be reduced by about 80%, saving considerable space. We will continue to apply andadvance our technology to further contribute to disaster prevention in the region.

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Concrete block
Break-water
platesDeck

Steel pipe
pile

Hybrid tide embankments*1 The JFE Engineering Corporation’s Steel infrastructure (Japanese only)(https://www.jfe-eng.co.jp/products/bridge/co01.html)

Permeable Steel Slit Dams
A permeable steel slit dam is a steel pipe structure installed in a river to trap debris flows.
Made of strong steel pipes to withstand the impact of driftwood and huge debris, it has large openings to let waterand sediment to pass through, which prevents the water level from rising upstream during floods and also ensuring thatdebris does not flow downstream. Since it does not block the flow of water, unlike a dam, it can be shaped to the slopeof a riverbed to protect the ecosystem. The JFE Group is working to expand the use of permeable steel slit dams by
reducing installation costs and shortening the construction period through structural innovations.

Permeable steel slit dam
Links to information about the JFE Group Environmental Vision for 2050 and Climate Change Scenario Analysis
Commitment to a Low Carbon Society:
Steel Industry Initiatives (P.90)
Targets and Results Related to Climate Change:
KPIs for material issues (P.19)
Initiatives on Climate Change:
Climate Change (P.55)
Technologies and Products Related to CO2 Emissions:
Development and Provision of Eco-friendly Processes and Products (P.94)

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Steel Industry Initiatives
The Japan Iron and Steel Federation (JISF) Initiatives
Long-term Vision for Climate Change Mitigation
In addition to JISF’s commitment to a low carbon society with the target year of 2030, JISF formulated and published in
November 2018 its Long-term Vision for Climate Change Mitigation for 2030 and beyond. JFE Steel played a central rolein formulating the vision. It represents the industry’s challenge for realizing zero-carbon steel and shows the prospectof achieving the 2°C scenario for steelmaking and the necessity of super-innovative technologies to achieve the 1.5°C
scenario. Furthermore, on February 15, 2021, the JISF announced the Basic Policy of the Japan steel industry on 2050
Carbon Neutrality aimed by the Japanese government, declaring that the Japanese iron and steel industry will boldly
accept the challenge of realizing zero-carbon steel.
Relevance with JISF's Long-term Vision for Climate Change Mitigation (P.79)

The Commitment to a Low Carbon Society
JISF is promoting its Commitment to a Low Carbon Society, which focuses on the Three Ecos initiatives and thedevelopment of innovative new iron and steelmaking processes. JFE Steel is actively implementing initiatives to help
achieve the plan’s targets.
■ CO2 Reduction Medium- to Long-term Targets (The Japan Iron and Steel Federation’s “Commitment to a Low Carbon Society”)
Eco Processes

Eco Products

Eco Solutions

Goal

Further improve energy
efficiency by taking fulladvantage of cutting-edge
technologies

Provide high-performancesteel materials that resultin high performing endproducts and thus reducing
CO2 emissions

Reduce CO2 in developing
countries
through the transfer andapplication of worldleading, energy-saving Eco
Process technologies

FY2020(phase-I)

Reduce CO2 emissions by
5 million t-CO2 comparedto the BAU benchmark• Energy-saving: 3 million
t-CO2• Efficient use of waste
plastics, etc.: 2 million
t-CO2

The use of major highperformance steel
materials to contributeto a CO2 reduction of
approximately 34.0 million
t-CO2

Estimated CO2 reduction
impact of 70 million t-CO2

Reduce CO2 emissions by
9 million t-CO2 comparedto the BAU benchmark

The use of major highperformance steel
materials to contributeto a CO2 reduction of
approximately 42.0 million
t-CO2

Estimated CO2 reduction
impact of 80 million t-CO2

Reduced 3.3 million
t-CO2 emissions (energy
conservation etc.),
compared to the BAU
benchmarkDomestic and internationaluse contributed to a CO2
reduction of 31.94 million
t-CO2

CO2 reduction impact of
68.57 million t-CO2

Targets

Three Ecos

FY2030(phase-II)

Status as of
FY2019 year-end

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Indices

Assessment of Commitment to a Low Carbon Society Results (JISF)
In FY2019, emissions by the Japanese steel industry decreased by 3.3 million t-CO2 compared to the BAU emissions*benchmark. Various self-improvement efforts, such as raising the efficiency of coke ovens and generation facilities,
are steadily contributing to this reduction. JFE Steel is actively working on these self-improvement efforts as well as
investing in research and development for new energy-saving technologies.
*Business As Usual emissions: Estimated level of emissions in the absence of any special measure

Revolutionary Iron and Steelmaking Process Development
COURSE50
About 30% of CO2 emissions can be reduced through hydrogen reduction along with separation and capture of CO2 fromblast furnace gases. The first facility is expected to come online by 2030, followed by other plants by 2050.

Ferro Coke
The Japanese steel industry intends to develop ferro coke that accelerates and lowers the temperatures of the reduction
reaction in a blast furnace as well as its operational processes to conserve energy further and expand the use of lowrank materials. A medium-scale plant capable of producing 300 tonnes of ferro coke per day has been constructed in JFE
Steel’s West Japan Works (Fukuyama district) and experimental testing for practice use started in FY2020.

Reduced CO2 Emissions through High-performance Steel Materials (Effects of Eco Products)
The Japan Iron and Steel Federation (JISF) expects the use of high-performance steel materials to reduce CO2 emissions.
It is estimated that the use of 5 major high-performance steel materials for cars, transformers, ships, power generator
boilers, and trains in Japan and overseas (FY2019 production: 7.06 million tonnes, 7.2% of crude steel production)
helped to reduce CO2 emissions by 31.94 million tonnes (10.13 million tonnes in Japan, 21.81 million tonnes overseas)
in FY2019.
*Estimates created by the Institute of Energy Economics, Japan*Materials included are steel sheets for automobiles, directional electrical steel sheets, thick steel sheets forshipbuilding, steel tubes for boilers, stainless steel sheets.
*For the domestic figures, the calculation includes data from FY1990 onward. For the export figures, the calculation
includes data from FY2003 onward for automobile and shipbuilding, from FY1998 onward for steel pipes for boilers andfrom FY1996 onward for electrical steel sheets.

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Indices■ CO2 Reduction Resulting from the Use of Five High-performance Steel Materials in Japan and
Abroad (FY2019)■ Ships■ Power-generator boilers■ Cars■ Trains ■ Transformers

0.7
1.99

2.27

0.28

Domestic
reduction of
10.13 million
t-CO2

6.81

Exportreduction of
21.81 million
t-CO2

0.96

4.66

9.64
4.62

Global Scale Initiatives
Addressing Global Warming
ISO 14404 is an international standard proposed by the Japan Iron and Steel Federation (JISF) to the International
Organization for Standardization (ISO) as a methodology for the globally unified calculation of CO2 intensity from iron andsteel production, ultimately to assess the energy efficiency of steelworks. The Japanese steel industry is addressing
global warming through international public-private collaborations, including ISO 14404-based assessment of steelworks
in developing countries and recommending specific technologies best suited to India and ASEAN countries. It is
continuing this effort together with the Ministry of Economy, Trade and Industry (METI) in order to enhance ISO 14404
so it can be applied to steel manufacturing facilities with more complex structures.
JFE Steel is also addressing global warming by participating in international activities, such as the Japan India Publicand Private Collaborative Meeting, the Japan-ASEAN Steel Initiative and the Japan-China Steel Industries Exchange. In
addition, JFE Steel is involved as a member of World Steel Association (WSA)’s Climate Action Program, which uses ISO
14404 as the standard for measurement and calculation.
■ Climate Action Member Certification

JFE Steel Corporation

10-yearmemberrecognition

In recognition of yourparticipation in theworldsteel CO2 datacollection programme
2020-2021.
Edwin BASSON
Director General

YU Yong
worldsteel Chairman

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IndicesT JFE SteelContribution to the Development of Calculation in LCA
In order to accurately evaluate the environmental impact of products, assessment and quantification is required overtheir entire life cycles, from raw resource mining to material production, product manufacture, use and final disposal. Life
Cycle Assessment (LCA) is one method for conducting this evaluation.
After final products such as automobiles and buildings finish their mission in society, all of their steel components
can be recycled and reused. This closed loop recycling ability is an excellent characteristic of steel materials. If LCA isconducted and this characteristic is taken into account, steel can be viewed as having extremely low environmental
impact compared to other materials.
JFE Steel played a major role in the development of ISO 20915 (Life Cycle Inventory Calculation Methodology for
Steel Products) and JIS Q 20915 (Life Cycle Inventory Calculation Methodology for Steel Products), initiatives led by theJapan Iron and Steel Federation (JISF), which takes into account the impact of recycling and provides life cycle inventory(LCI) calculation methods specific to steel products.
In addition, 15 Japanese manufactures of blast furnace and electric furnace joined forces to calculate the Japanese
average for LCI of different steel products. The calculation result based on their FY2018 operational data was also
published.

Value of Steel (P.6)■ Life Cycle of Steel Materials

Iron ore
Coal

Scrap
Scrap

Industrial
goods

Iron
products
Steelworks

Daily use

Mine

Disposal
End ofproduct
lifetime

Industrial goods
process

Substitution
for othermaterial(s)Heatconversion

Closed-loop recycling
Scope of the international standard under development

Related Links
The Japan Iron and Steel Federation (JISF): Climate Change Policy page (https://www.jisf.or.jp/en/activity/climate/index.html)
The Japan Iron and Steel Federation (JISF): LCA of Steel Products page (https://www.jisf.or.jp/en/activity/lca/index.html)
The Japan Iron and Steel Federation (JISF): Publication of ISO 20915 (https://www.jisf.or.jp/en/activity/lca/iso/index.html)
The Japan Iron and Steel Federation (JISF): Publication of JIS Q 20915 (https://www.jisf.or.jp/en/activity/lca/iso/index.html)

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PolicyDevelopment and Provision of Eco-friendly Processes and Products
Basic Policy
Based on its corporate philosophy of “contributing to society with the world’s most innovative technology,” the JFEGroup develops and provides processes and products for contributing to climate change solutions and reducing its
environmental impact. Through the initiatives described in the JFE Group Environmental Vision for 2050, intended to
expand our contributions to reducing CO2 emissions generated by the JFE Group and society as well as other efforts
to develop and provide processes and products related to preserving the global environment, the Group is striving toenhance its corporate value and play its part in realizing a sustainable society.

Primary Eco-friendly Products and Technologies by Business Segments
Each operating company of the JFE Group leverages its respective strengths to develop and provide a variety of ecofriendly products and technologies.
■ Primary Eco-friendly Products and Technologies
Product/Technology

Environmental Benefit

OperatingCompany

StatusFerro-coke (P.96)

Save energy and reduce CO2
emissions

Experimental
operation

Burner lance (P.97)

Save energy and reduce CO2
emissions

In operation

Guidance system for fuels/steam/power management (P.98)

Save energy

Partially inoperation

Zero-emission ship fuels through
CCU/CCS (P.98)

Reduce CO2 emissions

Underdevelopment

Multi-material structure of Ultrahigh strength steel with resin (P.99)

Improve fuel efficiency and reduce
CO2 emissions

1.5 GPa-grade high-tensile strength
cold-rolled steel sheets (P.101)

Improve fuel efficiency and reduce
CO2 emissions

CommercializedType 1 and Type 2 accumulatorsfor hydrogen stations (P.101)

Supply hydrogen

Commercialized

Calcia improvement material

Recycle resources and preserve
biodiversity

Commercialized

Steel slag hydrated matrix (P.103)

Recycle resources and reduce CO2
emissions

Commercialized(P.103)

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JFE SteelUnderdevelopment

Guideline
IndicesMessage fromthe CEO

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Product/Technology

Precast concrete products mixed
with finely ground blast furnace
slag (P.104)

SocialGovernance

ESG Data

Environmental Benefit

External
Evaluations
and Awards

OperatingCompany

Editorial
PolicyStatusRecycle resources and reduce CO2
emissions

Commercialized

Granulated blast furnace slag

Recycle resources and preserve
biodiversity and reduce CO2 emissions

Commercialized

Marine Stone® (P.105)

Recycle resources and preserve
biodiversity

Frontier Rock® (P.105)

Recycle resources and preserve
biodiversity and reduce CO2 emissions

Commercialized

Marine Block® (P.105)

Recycle resources and preserve
biodiversity and reduce CO2 emissions

Commercialized

Food waste recycling business

Recycle resources and expand
renewable energy(P.104)(P.106)

Establishing new regional
electricity businesses (P.107)

Expand renewable energy

Integrated plant management
system J-Answer (P.108)

Save energy and gain efficiency

Carbon recycling initiatives (CO2
separation and capture, waste tochemical) (P.108)

Reduce CO2 emissions

JFE Steel

J&T Kankyo

Commercialized

Business
expansion
Business
expansion
Started operation

JFE
Engineering

Underdevelopment,
experimental
operation

Improve water quality

Underdevelopment

Contribution to the realization of acircular economy (P.110)

Recycle resources and save energy

Business
expansion

Further expansion of global
supply chain for the Steel Sheets
Business (P.111)

Save energy and reduce CO2
emissions

Sales expansion

Building a supply chain forsteel materials and processed
products for offshore wind power
generation (P.111)

Expand renewable energy

Business
expansion

Aerobic granular sledge technology(P.109)

Expansion of biomass fuel trading(P.112)

Expansion of scrap trading helps
in the development of a recyclingoriented society (P.112)

JFE Shoji
Expand renewable energy and reduce
CO2 emissions

Sales expansion

Recycle resources and reduce CO2
emissions

Sales expansion

For further details on the JFE Group Environmental Vision for 2050, refer to the following resources.
The JFE Group Environmental Vision for 2050 (P.56)
The JFE Group Environmental Vision for 2050, presentation material on May 25, 2021
(https://www.jfe-holdings.co.jp/en/investor/management/plan/index.html)

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IndicesT JFE Steel

Ferro-CokeFerro-coke, an innovative raw material for blast furnaces, is made by mixing low-grade coke and iron ore. The ultra-fine
metallic iron inside acts as a catalyst and accelerates the reduction reaction rate in the blast furnace, reducing the amountof coke required and thus significantly reducing the amount of CO2 generated.
Since FY2017, JFE Steel has been promoting the New Energy and Industrial Technology Development Organization(NEDO) project, the development of environmental technology for the steelmaking process, and technologicaldevelopment of the iron making process using Ferro-coke. As part of the project, a medium-scale facility with the capacity
to produce 300 tonnes of Ferro-coke per day was constructed in the Fukuyama district of the JFE Steel West Japan Works,
covering 12,600 square meters of ground. Its experimental operation started in October 2020. This facility is designed tohandle all steps involved in the production of Ferro-coke, from crushing and drying to molding and dry distillation and iscapable of producing one-fifth of the production capacity expected for full commercialization (1,500 tonnes per day). It isalso capable of recycling Ferro-tar, a byproduct of Ferro-coke production, as a binding agent for briquetting.
In FY2021, the company is preparing for a demonstration study on the effect of using Ferro-coke in blast furnaces
over a long period of time. It will subsequently establish a technology that reduces CO2 emissions and energy
consumption in the iron making process by about 10% by around 2023.
■ Process Flow of the Medium-scale Ferro-Coke Production Facility
Mixing andBriquetting

Crashing and Drying

Dry
Distillation

Blast Furnace

Up to 10%energy savings
Low-gradeiron ore

Mixer

Dry distillation
furnace

Crusher

Reduction ofcarbon materials
Conventional
furnace coke

Low-grade
coal
Dryer

Briquetting

Expandingthe use of
low-gradematerials

Briquette

Briquette

10mm

Ferro-cokeproduction 300
tons daily

Ferro-coke

10mm

Cross section of Ferro-coke

0.2mm
Coke Metallic iron

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Medium-scale Ferro-Coke Production Facility

Burner Lance
JFE Steel’s smelting reduction furnaces are equipped with an exclusive, unique technology that melts chromium ore(Cr2O3) in the slag and reduces it with carbonaceous material (coke, coal) to recover metallic chrome (Cr), the raw material
for stainless steel. Unlike conventional stainless steel refining processes, this approach significantly reduces the amountof ferrochromium (FeCr) alloys used, which consume a large amount of energy during production, and so it achieves
extremely high energy efficiency.
The new technology adds a pure oxygen burner function, one of the world’s largest burners using hydrocarbon gas
as fuel, to the conventional chromium ore feeder lance. Chromium ore is heated via a high-temperature flame and fed
to the furnace, which results in providing the furnace with the necessary heat more efficiently than the conventional
method. Other applications for these burner lances are also under consideration, such as incorporating it into normal steel
converters to transfer heat for accelerating the rate of scrap melting.
The technology has improved energy efficiency by about 20% and reduced CO2 emissions by about 10% comparedto the conventional method. Also, it received the 53rd (FY2020) Ichimura Prize in Industry for Outstanding Achievement.
Looking ahead, we will apply the technology to the scrap melting process in converters. By helping to increase theamount of scrap used and thus reducing CO2 emissions, the company will contribute to the realization of a sustainable
society.
JFE Steel’s Chromium Stainless Steel (https://www.jfe-steel.co.jp/en/products/stainless/index.php)■ Process of Smelting and Reducing Chromium Ore Using a Hydrocarbon Fuel Burner
Top blown
oxygenmaterial

By heating chromium ore particles at a high speed inhigh-temperature flames before feeding them to the furnace,
the energy efficiency improved by 20%↓

Less carbonaceous materials needed, thus less CO2 emissions

Energy efficiency
improved by 20%

Amount of energy
supplied per unit ofchromium ore (index)

Carbonaceous
material

Burner lance for heating and feeding chromium ore
Top blown
oxygenHydrogen-based fuelChromium ore
feeding lance
Carbonaceous
OxygenConventional
methodConventional method
Heat source:carbonaceous material

Newly developed method

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New method
Hear source: carbonaceous
material + hydrogen-based fuel

Message fromthe CEO

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PolicyGuideline
IndicesA Guidance System for Fuels, Steam and Power management in Steelworks—Optimization of Energy Consumption Based on Cyber-physical Systems
JFE Steel developed what it calls the Guidance System for operators to efficiently utilize fuels and electricity in domestic
steelworks to reduce energy consumption and CO2 emissions. So far, the system has been introduced in the Kurashiki
and Fukuyama districts in the JFE Steel West Japan Works and will be rolled out in other sites to increase the overall
benefits in reduced energy consumption and CO2 emissions.
In steelworks, gases, electricity and steam that are generated as by-products by upstream processes are consumed
within the same premises. We also purchase fuel and electricity from external sources to meet actual demands. To
efficiently utilize fuel and electricity, many different factors need to be managed to minimize cost and energy losses,
including the ratio of by-product gases to be distributed to each process, the storage volume of by-product gases, andthe amount of electricity and fuel to be purchased.
The Guidance System (1) uses the vast amount of real-time data obtained based on CPS and each factory’s detailmanufacturing plan, (2) calculates precise future demands, (3) takes into account operational constraints and contract
information, (4) runs simulations to determine the optimal operational plan for minimizing external purchases, and (5)guides operators toward this optimal plan.
■ Steelwork’s Energy Flow

■ Guidance System Overview

Guidance System to Manage Fuels and Electricity
Consumptions at Steelworks (Japanese only)(https://www.jfe-steel.co.jp/release/2020/01/200130.html)

CCS/CCU—Cross-Industry Initiatives for Zero-Emission Ship Fuels through Methanation Technology
The steel industry relies on ships to transport most of its raw materials and products. Therefore, it is important for
the industry to consider how to reduce CO2 emissions throughout its supply chain. As a member of the Ship Carbon
Recycling Working Group (WG) of Japan’s Carbon Capture & Reuse Study Group, which was formed in August 2019,
JFE Steel participates in exploring the feasibility of utilizing methanation technology for zero-emission ship fuels. ThisWG has nine participating members, EX Research Institute Ltd., JFE Steel Corporation, Mitsui O.S.K. Lines, Ltd.,Sanoyas Shipbuilding Corporation, JGC Corporation, Nippon Kaiji Kyokai (Class NK), Nihon Shipyard Co. Ltd., Nippon SteelCorporation and Hitachi Zosen Corporation, and is exploring a value chain that does the following: (1) Separation, capture
and liquefaction of CO2 emitted from steelworks, (2) Transportation of liquefied CO2 by ship to a hydrogen supply site, (3)Generation of synthetic methane from CO2 and hydrogen by methanation reaction, and (4) Liquefaction of the synthetic
methane assuming that it will be used as marine fuel. In addition to obtaining an approximate value of CO2 emission, theWG also identifies technical challenges.
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Reduce CO2 Emissions at JFE Steel (P.61)■ Initiatives of Japan’s CCR Study Group “Ship Carbon Recycling WG”
Assumed Supply Chain

Roles at Ship Carbon Recycling WG(1) CO2 separation and capture(2) CO2 transportation(3) Methanation fuel synthesis(4) Methanation fuel liquefaction

Calculation and coordination

Ultra-high Strength Steel Structure Using Resin for Energy Absorption—Multi-material Technology that Further Reduces Weight of Automobile Structural Parts
and Improves Collision Safety Performance
JFE Steel and Iida Industry Co. Ltd. have jointly developed a multi-material structure that uses resin in structural partsfor automobiles. The new structure facilitates the use of ultra-high tensile strength steel sheets for the energy-absorbing
parts of automobiles.
In recent years, the use of ultra-high-strength steel sheets (tensile strength of 980 MPa or higher) in structural frameparts has significantly increased to meet expectations for both high collision safety performance and automobile weight
reduction. These applications, however, have been limited to parts that constitute the cabin, such as the center pillar,
where deformation should be limited in a collision. The application of ultra-high strength steel sheets to front and rearside members where collision energy needs to be absorbed by the deformation of the parts, has been difficult because
fracture occurs in the steel parts by buckling and severe bending.
To make ultra-high strength steel sheets applicable to energy-absorbing parts, JFE Steel developed a structure inwhich a highly ductile and adhesive resin, developed by Iida Industry Co. Ltd., is sandwiched between a structural partmade of ultra-high strength steel sheet and a part made of thin steel sheet. The ultra-high strength steel sheet in the
structure has a greater bending radius and does not break, even when used in energy-absorbing parts and buckled or
bent in a collision. As a result, the structure is capable of improving energy-absorbing performance by 53% comparedto materials of the same weight and reduces weight by 25% compared to materials with the same energy-absorbing
performance.

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and Awards■ Newly Developed Multi-material Structure■ Energy-Absorbing Performance Improvement and Weight Reduction
Using Multi-Material Technology
Body weight: 1.24kg

Energy absorption: 14.4kJ

200

150

Weight comparison (conventional structure = 100)

Energy absorption comparison (conventional structure = 100)

Message fromthe CEO

Energy absorption
improved

by

53％

100

50

0

590MPa-2.0t

of1470MPa-1.4t

25％

50

0

Conventional structure Newly developed
structure (multi-material)

Weightreduction

100

Conventional structure Newly developed
structure (multi-material)

590MPa-2.0t

1470MPa-1.4t

Energy-absorbing, Ultra-high Strength Steel Structure Using Resin (Japanese only)(https://www.jfe-steel.co.jp/release/2021/03/210302_2.html)

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Indices

1.5 GPa-Grade High-Tensile Strength Cold-Rolled Steel Sheets
In 2020, JFE Steel Corporation announced that its 1.5 GPa-grade (1470 MPa) high-tensile strength cold-rolled steel
sheets are now being utilized in vehicle body structural parts, the world’s first such adoption in a cold press forming
application*1. This constitutes the highest strength of vehicle body structural parts obtained through cold press forming.
In order to protect vehicle occupants in the event of a collision and improve fuel economy through weight reductions,
efforts are ongoing to increase the strength of vehicle body structural parts. JFE Steel’s 1.5 GPa-grade high-tensile
strength cold-rolled steel sheets are already being utilized in parts with simple shapes, such as bumpers and door impact
beams. However, the adoption for vehicle body structural parts with complex shapes has been limited to the 1.3 GPa(1,310 MPa) grade until now because increasing the strength of sheets can result in decreased cold press formability anddelayed fracture resistance*2, and the adoption of 1.5 GPa-grade high-tensile strength steel sheets through a hot press
forming process*3 was more widespread.
JFE Steel used the high cooling capacity of the proprietary WQ method-based*4 continuous annealing process line
located at JFE’s West Japan Works (Fukuyama District) to reduce the addition of alloy elements and minimize nonuniformity of the steel microstructure. As a result, particularly high yield strength*5 and delayed fracture resistance were
simultaneously realized even with the 1.5 GPa-grade high-tensile strength steel sheets while maintaining cold press
formability equivalent to that of 1.3 GPa-grade sheets. This enabled the utilization of the 1.5 GPa-grade high-tensile strength
steel sheets in vehicle body structural parts through a low-cost and environmentally sound cold press forming process. JFE
Steel is contributing to the reduction of CO2 emissions through this product and its use in automobile components.
*1 Based on JFE Steel research*2 Delayed fracture resistance: A property that inhibits the occurrence of static brittle cracking attributed to hydrogen
after press molding*3 Hot press forming process: A process in which a material is heated to a high temperature and softened and is thensimultaneously molded with a press die and quenched to obtain a high-strength part.
*4 WQ method: Water quenching method*5 High yield strength: Strength at which a steel sheet begins to deform. The yield strength directly impacts the strength of a part.
■ Schematic Diagram of the WQ Method-Based Continuous-Annealing Equipment

1.5 GPa-Grade High-Tensile Strength Cold-Rolled Steel Sheets (https://www.jfe-steel.co.jp/en/release/2020/201223.html)

Commercialization of Type 1 and Type 2 Accumulators for Hydrogen Stations
In FY2018, JFE Steel and JFE Container have commercialized Japan’s first Type 2 accumulator*1 for hydrogen stations
and it has been installed at the Toyota Toyoe Hydrogen Station in Aichi Prefecture. In FY2020, they also commercialized acost-effective, large capacity Type 1 accumulator*2. The straight shape of the container creates microstructures with highresistance to hydrogen embrittlement*3, enabling the accumulator to offer industry-leading pressure range and longevity.
Type 1 accumulator can be manufactured in capacities ranging from 100 to 400 liters, while the industry standard forType 1 accumulator capacity is 300 liters. The flexibility in accumulator sizes makes it possible to build hydrogen stations
more closely tailored to customer needs and reduces construction cost. The Type 2 accumulator, on the other hand,
has a wide pressure range and can supply large volumes of hydrogen all at once. Consequently, the accumulators are
anticipated to have a role in fuel cell buses and hydrogen stations that require a large volume of hydrogen and therefore
demand is expected to rise.
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Indices*1 Type 2 accumulator: A composite vessel accumulator with carbon fiber reinforced plastics (CFRP) wrapped aroundthe body of a steel liner to achieve excellent properties. Part of the research and development undertaken by the JFEGroup for the Type 2 accumulator was carried out under the NEDO’s hydrogen technology research and development
project (FY2013 to FY2017).
*2 Type 1 accumulator: A vessel produced using an extra-thick seamless steel pipe. Although Type 1 has a narrowerpressure range than Type 2, it boasts a larger capacity and lower cost.
*3 hydrogen embrittlement: Deterioration of material’s properties by hydrogen.

■ Large-capacity, Cost-effective Type 1 Accumulator
for Hydrogen Stations
Straight cylinder
Optimized
screw structure
Design pressure 95MPa
Ultra-high pressure container

Passed the preliminary assessment
by KHK (High Pressure Gas Safety
Institute of Japan) in February 2020
Main features:

1. By optimizing the screw structure, achieves a longer service life.
2. By using mass-produced seamless steel pipes for the body, achieves low cost
3. Option available to adopt non-destructive inspection to simplify safety inspections
and thus lower the cost of running hydrogen stations■ High Pressure Range Type 2 Accumulator for
Hydrogen Stations
Straight liners

Seamless steel
pipes and CFRP

Certified by the Ministerof Economy, Trade andIndustry in November 2018

Optimized
screw structure
Main features:

1. Optimizing the screw structure for longer service life through the shared pressure
resistance between steel and CFRP
2. Using mass-produced seamless steel pipes for the body for a lower cost
3. Maximizing the pressure sharing of the liner so that a smaller amount of CFRP is
required, thus reducing the cost
4. Simplifying the liner manufacturing process and CFRP wrapping process by using
straight liners, thus reducing the cost
5. Option available to adopt a non-destructive inspection to simplify safety
inspections and thus lower the cost of running hydrogen stations

Toyoe Hydrogen Station
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Indices

Calcia Improvement Material
Calcia improvement material is a slag product, which uses converter type steelmaking slag as raw material and is
manufactured by controlling composition and adjusting particle size. Dredged soil mixed with calcia improvement
material is called calcia improvment soil, which is stronger than the original weak dredged soil, and therefore is able toprevent dredged soil from dissipating into the surrounding area and having a negative impact on the environment when
put water.
This enables the use of weak dredged soil in land reclamation, shoal and tideland construction and refilling former
dredging sites. In the construction of Shin-Honmoku Wharf in Yokohama Port, it was used as a material for the partition wall*.
*An embankment built under the water surface on the inside of a perimeter wall to divide the land into sections forreclamation.
■ Calcia Improvment Material and Calcia Improvement Soil

Dredged soil

Calcia improvement material

Calcia Improvement soil

Example of calcia improvement soil application (shoal and tidelandconstruction material)

Steel Slag Hydrated Matrix
Steel slag hydrated matrix is a steel slag product that can be used as a substitute for concrete but uses ground granulated
blast furnace slag instead of cement and steel slag instead of natural gravel and sand aggregate as its ingredients. It
effectively uses steel slag and does not rely on natural aggregate, thereby reducing environmental impact, uses lesscement and in turn reduces CO2 emissions.
There are many examples of blocks and artificial stones made from steel slag hydrated matrix being used as a
substitute for concrete blocks and natural stones in harbor works, including the runway D construction project at Haneda
Airport by the Ministry of Land, Infrastructure, Transport and the coastal reconstruction project after the Great East Japan
Earthquake. In addition, we are conducting onsite monitoring in the Katsunan Central Zone in Chiba port with the help ofa local fishing association to assess the impact of these blocks on marine biodiversity.
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SocialGovernanceWave-dissipating and foot protection block

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Indices

Artificial stones made from steel slag hydrated matrix

Precast Concrete Products Mixed with Finely Ground Blast Furnace Slag
Finely ground blast furnace slag can be used as a cementing material in concrete. This type of concrete exhibits
significantly higher durability under harsh conditions such as applications in sewers and exposure to anti-freeze agents.
Its effectiveness in reducing environmental impact has been widely understood, although there has recently been
growing interest in its practical applications for concrete constructions that require higher durability.
As one of the deliverables for the Japanese government’s Strategic Innovation Promotion Program (SIP), the Japan
Society of Civil Engineers published a (draft) guideline in March 2019 on the application of finely ground blast furnace slag
to precast concrete product and its application now includes precast concrete slabs installed in highways and piers. With
the application of finely ground blast furnace slag in concrete, the durability of precast products is expected to be greaterand more consistent, allowing them to contribute to building national resilience.
Precastconcrete slabs

Precast concrete slabs mixed with finely ground blast
furnace slag installed in piers

Use of Granulated Blast Furnace Slag to Reduce CO2 Emission
Granulated blast furnace slag in crushed and powdered form can be mixed with cement and used as a substitute forcement for making concrete. This leads to reducing the production of cement hence lower CO2 emissions. For example,
producing one tonne of blast furnace slag cement with 45% of its content substituted with granulated blast furnace
slag emits 41% less CO2 than conventional cement. In FY2020, JFE Steel supplied approximately 6.4 million tonnes of
granulated blast furnace slag to cement production, equivalent to a reduction of approximately 4.55 million tonnes of CO 2
emissions.

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Indices■ CO2 Emission for Producing 1 Tonne of Cement (Unit: kg-CO2 / ton)
Regular Cement

Blast Furnace Slag
CementLimestone

473

272

Electricity/energy

311

190

Total

784

463

CO2 Emissions Source

Restoring Marine Ecosystems Using Steel Slag Products and Tackling Blue Carbon
Marine Stone®, a steel slag with adjusted particle size, has the function of controlling the generation of hydrogensulfide from the silty sediment in enclosed coastal seas and improving the environment where organisms can live its
effectiveness in improving marine environments has been widely recognized, and the joint project with Hiroshima
University received the Minister’s Prize (Ministry of Agriculture, Forestry and Fisheries) in the 12th Eco Products Awards
and the Grand Prize in the 26th Nikkei Global Environmental Technology Award.
Another steel slag product, Frontier Rock®, consists of artificial stones made from steel slag hydrated matrix andprovides an excellent base for seaweed bed and fishing reef. A submerged bank built on the seabed off the coastof Minami-Izu Town, Shizuoka Prefecture, has successfully recovered fishery resources, attracting large perennial
seaweeds and sawfish, as well as lobsters, turban shells, and a variety of fish.
In addition, we are focusing on blue carbon (carbon absorbed and fixed by marine organisms), which has been a fieldof active research in recent years. We are involved in creating seaweed beds using steel slag products, measuring theamount of carbon absorbed by the seaweed beds and testing Marine Block® as beds for corals.
Marine Block®

Frontier Rock®

Coral growing on Marine Block®

School of fish attracted to the submerged bank made of
Frontier Rock®

Contributing to the Creation of an Attractive Seaside Town by Utilizing Steel Slag Products(Partnership Agreement with Yokohama City)
In a joint research project with Yokohama City, JFE Steel has confirmed that steel slag products, including Marine Block®,which is steel slag absorbing CO2 gas, provide a highly effective base for nurturing and growing marine organisms while
also facilitating the natural purification of seawater. To continue improving the marine environment in Yokohama Bay anddeveloping an attractive seaside town, we signed a new partnership agreement* with Yokohama City in March 2020.
Under this agreement, we have continued to work toward improving the marine environment.
*Partnership agreement to improve the marine environment in Yokohama Bay and develop an attractive seaside town
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IndicesMarine Block® covered by marine bivalves (Yokohama Bay area)E

N JFE Engineering

Food Waste Recycling Business
J&T Recycling Co., a subsidiary of JFE Engineering, is engaged in the food waste recycling business, in which food waste
is collected and fermented to produce methane gas which is then used as fuel to generate power.
The company will promote its food waste recycling business and contribute to the expansion of renewable energy
supply through J Bio Food Recycle Co., Ltd., which was established in 2018, Sapporo Bio Food Recycle Corporation(located in Sapporo-city, Hokkaido, acquired in 2019), Tohoku Bio Food Recycle Corporation (located in Sendai-city,
Miyagi, established in 2019 jointly with East Japan Railway Company, Tokyo Gas Co. Ltd., Tohoku Railway Transportation
Co. Ltd., scheduled to start operation in 2022), and Bios Komaki Co. Ltd. (located in Komaki-city, Aichi, acquired in 2020).

Company NameJ Bio Food Recycle Co., Ltd.

Volume of Food Waste
Processed

Estimated Amount ofElectricity Generated(Annual)Notes

80 tonnes per day

11,000 MWh

Sapporo Bio Food Recycle
Corporation

68 tonnes per day

1,470 MWh(2020 actual data)

Tohoku Bio Food Recycle
Corporation

40 tonnes per day

6,500 MWh

Scheduled to start
operation in FY2022

Bios Komaki Co. Ltd.

120 tonnes per day

9,200 MWh

Scheduled to start
operation in FY2022

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In operation
In operation, also
engaged in feed andfertilizer production fromfood waste

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Pre-treatment plant

Gas engine

Methane fermentation tankGas holder

Biogas (methane gas) power
generation facility

Regional Electricity Retail Businesses in Partnership with the Local Municipal Governments
through Developing New Regional Electricity Businesses
JFE Engineering has established several regional electricity retail companies in partnership with local municipal
governments. It is actively involved in the regional electricity business, with a particular focus on the distribution ofrenewable energy.
JFE Engineering is establishing frameworks for effectively using renewable energies such as hydropowerand geothermal energy in regions and for supplying electricity from renewable energy plants constructed by JFE
Engineering, such as waste-fueled, to regional public facilities. Through these efforts, JFE Engineering is supporting
local production and consumption of electricity. These regional electricity businesses promote the use of renewableenergy and decarbonization of the region while also reducing administrative costs and enhancing the region’s industrial
infrastructure.
■ JFE Engineering’s Support of Local
Production for Local Consumption

Niigata City
Niigata Swan Energy:
Sales of locally produced electricity
from waste power generation

Hachimantai City
Fukuyama City

Sales of local electricity from
Matsuo-Hachimantai Geothermal
Power Plant

Fukuyama Mirai Energy:
Sales of locally produced electricity
from waste power generation

Kumamoto City

Tokorozawa City

Smart Energy Kumamoto:Sales of locally produced electricity
from waste power generation

Tokorozawa Mirai Denryoku:
Sales of locally produced electricity
from waste power generation

Iwata City
Izumo City
Minamata City

Izumo Enmusubi Denryoku:
Sales of locally produced
duced electricity
from waste power generation

Smart Energy Iwata:
Sales of electricity from local
wind power generation plant, etc.

Toyohashi City
Honokuni Toyohashi Electric Power
Sales of locally produced electricity
from biogas power generation

Sales of electricity fromlocal hydroelectric power generation plant

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Integrated Plant Management System, J-Answer
JFE Engineering has developed the following systems for more advanced plant operations, and is actively deploying
them to ensure stable plant operation.
• Pla’cello: Data analysis platform which allows users with no specialized IT knowledge to leverage AI and big data
• PAZ: Plant operation management system that consolidates and utilizes operational data from environmental plants andis equipped with various functions including automatic report creation• BRA-ING: Automated incinerator operation system that uses AI image analysis and other techniques to systemize
incinerator plant operations that were formerly performed manually• Global Remote Center (GRC): Remote center that consolidates data from operating plants nationwide, and monitorsand operates them remotely
The company employs these systems for the operation of its own plants, and in 2019, became the first in Japan tooperate a fully unmanned waste treatment facility.
J-Answer is a platform system that provides the ideal solution for full plant operation by linking systems that had
been separately developed, sharing data between these systems, analyzing linked data, and so on. Using the vast
knowledge acquired in construction and from operating a wide range of environmental plants, the company optimallycombined operational elements that are common between these plants and those that are unique, to develop “J-Answer
for waste” for waste treatment plants and “J-Answer for aqua” for water treatment plants. JFE Engineering will apply
these systems to its plant operations and contribute to the realization of a recycling-oriented society. This will also help
to reduce the impact of plant operations on the environment, thus contributing to environment preservation.
■ J-Answer System Components

Integrated Plant Management System J-Answer (Japanese only)(https://www.jfe-eng.co.jp/news/2020/20201116.html)

Carbon Recycling Initiatives (CO2 Separation and Collection, Waste to Chemical)
The JFE Engineering Group is already engaged in recycling plastic wastes, including bottle-to-bottle recycling for PET
bottles. In addition, the Group is also developing a new technology that simultaneously achieves carbon recycling of
CO2 and chemical recycling of waste plastics. By developing technologies for separating and capturing CO2 generated
from incinerators and power generation facilities, as well as technologies for manufacturing chemical products using thecaptured CO2, the Group will contribute to the realization of a low-carbon, recycling-oriented society.

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Indices■ JFE Engineering’s Carbon Recycling Initiatives•CO2 separation and capture•Converting CO2 into synthesis gas and chemical products

Areas in which
JFE Engineering
is engaged:

Waste plastic(source of H2 and energy)
H2

CO

CO2

CO2 separationand capture

Exhaustgas(Technology to
manufacturechemicalproducts using
CO2)

Syngas production furnace■ Carbon recycling of CO2■ Chemical recycling ofwaste plastic

Chemical plant

Achieved at
the same time

Facilities
generating CO2-Incinerators-Steelworks-Chemical plants

Chemical products
Consumed

Expanding Sewage Treatment Using Aerobic Granular Sledge Technology to Southeast Asia
To meet the growing need for sewage treatment in Southeast Asia arising from rapid centralization of the population,
JFE Engineering is expanding the application of Aerobic Granules method*, a compact, energy efficient wastewater
treatment technology.
Traditional wastewater treatment uses activated sludge, composed of groups of microorganisms. Since it takes
Activated sludge a long time until sedimentation and purified water separation, the final sedimentation basins of sewage
treatment plants require a large area of land. Our technology, on the other hand, uses aerobic granules instead of muddy
activated sludge. Their granular property enables them to settle much faster. Therefore, the process of decomposing
pollutants in sewage and separating from the purified water is more efficient, and the treatment facility requires lessspace and energy. Typically, wastewater treatment using this method requires 50–75% less space and 40–60% lessenergy than conventional methods.
JFE Engineering has verified the effectiveness of this technology in the Philippines and now intends to introduce it to
its sewage market and other Southeast Asian countries.
*Nereda® technology, owned by Royal Haskoning DHV (Netherlands). In 2020, it was recognized as the breakthroughtechnology of the decade in water treatment from a global perspective, and JFE Engineering signed an exclusive
contract for the Philippines wastewater treatment market.

Sedimentation separation status after one minute(left: aerobic granular sludge, right: activated sludge).
Microorganism-containing sludge at the bottom, purified
water at the top.

Garmerwolde wastewater treatment facility in the Netherlands
While the two facilities have the same processing capacity(70,000 m3 per day), the one employing the new technology
takes 60% less space than the conventional facility.

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Contribution to the Circular Economy through JFE Engineering’s Businesses
JFE Engineering offers a wide range of products and services to support infrastructure, including waste and renewableenergy power generation plants, environmental plants that recycle food and plastics, water supply and sewage systems,
and bridges. It is engaged in all parts of their lifecycles, from design and construction to operation, maintenance, andreconstruction.
In the business of constructing and operating waste-fueled power generation and various recycling plants, JFE
Engineering seeks to thoroughly use waste as it implements various initiatives. Furthermore, in social infrastructure
facilities, including these plants, the company focuses on maximizing their use through the integrated implementationof resource saving, long-life design, energy and labor-saving construction, efficient facility operations, effective
maintenance, and renovation.
JFE Engineering engages in a circular economy and contributes to the realization of a sustainable society throughefforts that leverage JFE Engineering’s multidisciplinary businesses.

as

te

ze

Resource
recycling
Energy- andlabor-saving
construction

tu

re

use

Maintenanceand renovation

Efficient operation

Maxi

mi

uc

Thoroug

hly

ut

ili

Resource-saving
and long-life designtrw■ JFE Engineering’s Approach to a Circular Economyze

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in

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H JFE Shoji

Further Expansion of the Global Supply Chain for the Steel Sheets Business
The key factor in initiatives for countering climate change, including those aimed at reducing CO2 emissions, is minimizing
electricity loss and using generated electricity without loss. Motors found in places such as power plants, factories
and homes are responsible for 40–50% of all electricity consumed globally. In Japan, the ratio is approximately 60%.
Improving the efficiency of motors by 1% in Japan that would contribute to the equivalent of a 500,000 kW-class power
generation plant in energy savings.
Technological advances are expected in electrical vehicle’s engine motors, for which demand is expected to rise as
we transition to a decarbonized society, and in various types of motors for cars, which could be as many as 50 to 100
motors per vehicle. We also expect improvements in efficiency and further reductions in size and weight.
In addition, in order to minimize energy loss while distributing electricity from source to factories and homes,
continuous improvement is required in transformers, where the most loss of electricity occurs, to make them more
efficient.
JFE Shoji has established a stable global supply chain that sources high-quality electrical steel sheets which areessential for improving the efficiency of motors and transformers from JFE Steel and other manufacturers and processes
the products for meeting customer needs. Customers who require high-quality electrical steel sheets, such as motor
manufacturers and transformer manufacturers, typically operate manufacturing facilities across the globe. To align itself
to this trend, the company has been expanding its electrical steel sheets supply chain based in a global quad-polarorganization that includes Japan, America, China, and ASEAN. By further expanding its supply chain and processing
capabilities and collaborations with alliance companies, the company is striving for significant improvements in the
distribution and processing of electrical steel sheets, as described in the Seventh Medium-term Business Plan, and morethoroughly responding to customer needs.

Building a Supply Chain for Steel Materials and Processed Products for Offshore Wind
Power Generation
Many countries are expanding their efforts to achieve carbon neutrality, and the use of renewable energy including wind
power is seen as a key factor.
In Japan, Act on Promoting the Utilization of Sea Areas for the Development of Marine Renewable Energy Power
Generation Facilities was enacted in 2019, and an environment for commercializing offshore wind power generation
is being established. The Japanese government has announced plans to increase the share of offshore wind power in
its power supply mix from 0.7% in FY2019 to 1.7% in FY2030, and the number of offshore wind power construction
projects is expected to increase. Other Asian countries are also announcing offshore wind power projects. The JFEGroup intends to pioneer in the field of offshore wind power generation, in the business of constructing foundation
structures for wind towers and in their O&M, by building a supply chain that takes full advantage of all its operatingcompanies.
JFE Shoji focuses on building a supply chain for the foundation structures for wind power generation towers. In
Taiwan, which is leading in the offshore wind power generation market, the company is collaborating with a local
enterprise that manufactures the necessary equipment, and accumulating experience in the supply chain of steel
materials for offshore wind power. Looking ahead, it will further expand its supply chain and respond to the demandfor offshore wind power generation in the ocean settings surrounding Japan, and thus contribute to the expansion ofrenewable energy.

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Expansion of Biomass Fuel Trading
In response to growing demand for biomass fuels by biomass power generation companies, JFE Shoji imports palm
kernel shells to Japan from Malaysia and Indonesia. In addition, as the trend toward reducing CO2 emissions accelerates,
demand for renewable energy is rising, especially for biomass power generation which is not affected by weather
conditions. We will respond to this demand by exploring other types of biomass fuels, such as wood pellets, to ensurea stable supply of biomass fuels. Wood pellets are a biomass fuel that allows for the effective reuse of wood materials
from thinning and pruning forests or waste materials from woodworking operations.
We will continue to supply fuel to biomass power generation companies, including JFE Engineering, and do our partin the JFE Group’s overall contribution toward realizing an eco-friendly society.

PKS

Wood pellets

Expansion of Scrap Trading Helps in the Development of a Recycling-oriented Society
JFE Shoji’s recycling business for steel and aluminum scrap includes the export of steel scrap to Asian countries, where
it is sold for both offshore and domestic trading. Although steel scrap exported from Japan is mainly transported by bulk
carriers in general, timely shipments of small lots is now also possible due to the container loading system introduced by
JFE Shoji, contributing to the development of recycling-oriented societies in Asia.

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Efficient Use of Resources
Basic Policy
Economic growth in emerging countries is intensifying the need to conserve non renewable resources and prevent
pollution. Iron can easily be separated and is thus highly recyclable. It can be recycled and reused to make other steel
products infinite times (closed-loop recycling). The JFE Group is leveraging each Group company’s strengths to enhanceresource recycling through recycling co-products from iron and steelmaking, reducing waste at construction sites, andpromoting the global recycling of steel scrap.

Promoting Resource Recycling
Each operating company of the JFE Group carries out resource recycling suited to its particular business. We continue
to pursue increasingly efficient uses of resources in both the production and product/service phases of its businesses,
including steel scrap recycling, biomass fuel production and waste-to-energy power generation.

Reducing Generation and Emission of Co-products and Reusing Co-products
S

T JFE SteelJFE Steel carefully controls the generation and emission of iron and steelmaking slag (co-product), iron dust from blast
furnaces and converters, sludge from water treatment facilities, and other coproducts. The target rate for recycling is
99% or more. Dust and sludge with high iron content are recycled as raw materials for steelmaking. Iron and steelmaking
slag is effectively recycled for reuse in cement and other construction materials. We are also promoting their use asenvironment recovery material such as Marine Stone™, which works effectively as a base for the adhesion of organisms
and for improving the marine environment. As a result of such efforts, the company achieved a 99.7% recycling rate forslag, dust, and sludge in FY2020, consistently maintaining the target of 99% or higher.

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Indices■ Landfill of Co-products and Recycling Rates■ Landfill amount (non-consolidated)(Million tonnes)

0.48

0.5

99.7

● Recycling rate (non-consolidated)

99.7

99.7

99.7

99.7

0.4
0.3

（％）

100
Target:99% orhigher 98
96

95.6

0.2

94

0.045

0.047

0.052

0.043

0.037

1990

2016

2017

2018

2019

2020 (FY)

Amountreleased

—

0.776

0.539

0.792

0.546

0.513

Amounttransferred

—

0.042

0.034

0.029

0.031

0.023

0.1
0

92
0

Group
companies*(Million
tonnes)(Million
tonnes)*25 JFE Steel consolidated subsidiaries in Japan.
For more on quantitative data related to co-products, please refer to the following information.
Environmental Data (P.198)

Promoting RecyclingE

N JFE Engineering

Most of JFE Engineering’s waste is either rubble and sludge discharged from construction sites or industrial waste
discharged by the Tsurumi and Tsu works. We strive to reduce industrial waste and promote resource recycling throughvarious measures, which include setting environmental goals for recycling rates and properly separating the waste onsite before sending it to disposal companies known for achieving high recycling rates.
The Yokohama head office has been certified as a “Workplace with Excellent 3R Activities” by the City of Yokohama
every year since FY2012. Its efforts are waste reduction (encouraging double-sided copying), reuse (setting up collection
boxes for plastic folders and plastic business card cases and recovering label printer cartridges), and recycling (thoroughly
separating waste). The JFE Engineering Group is also working to realize a recycling-oriented society through its PET
bottle and food waste recycling initiatives.

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ESG Data■ JFE Engineering Group Waste Disposal for FY2020
Other: 1.1
JFE Engineering:
98.8

Asuka Soken:
48.7

Total:
159 thousand
tonnes

JFE Pipeline
Engineering:
9.0
JFE Environmental
Service: 1.5

Data cover JFE Engineering and 10 consolidated subsidiareisin
Japan.
■ Waste Generated at Construction Sites■ Total ■ Final disposal(Thousand tonnes)
200

98.4

98.4

98.4

150

101.8
100

97.1
145.4

109.0

● Recycling rate (%)

98.3

90

97.4

88.1

80

50

0

100

70

1.6

1.4

1.8

4.2

2016

2017

2018

2019

1.7
2020 (FY)For more on waste generated at the steelworks, please refer to the following information.
Environmental Data (P.198)

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IndicesResource Recycling Solutions
The JFE Group is involved in establishing a recyclingoriented society through a variety of initiatives. Steelworks promotes
the efficient use of raw materials, water, and other resources in the process of iron and steelmaking in addition to
encouraging the application of recycled resources such as used plastics for blast furnaces. Moreover, we are striving
to more efficiently use co-products generated in the iron and steelmaking process through initiatives such as theinternational recycling of steel scrap.
In the engineering field, in addition to constructing and providing customers with waste incineration plants and plants
for treating sludge, we are developing a waste recycling business and an energy supply business to offer resource
recycling solutions.

For more on this, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P. 94)

Social challenges for resource recycling• Exhaustion of resources• Shortage of waste treatment facilities
and disposal sites• Labor shortage• Using renewable energy

Society
Customer/User(Product→Use→Dispose)

Solution 6

Waste
Scrap

Initiative 2
Initiative 4

Solution 4
Initiative 1

Steelworks

Recycling BusinessInitiative 3

Steelproducts

Efficient use ofco-products

ByproductenergyRecycledresources

Recycled
products

Renewableenergies

Solution 3

Solution 5

Solution 1

Solution 2

Initiatives for Resource Recycling Solutions
Accumulated
amount recovered at
JFE Bars & Shapes:
86 thousand tonnes!

Plastic used in ironResource Recycling Solutions andsteelmaking: 50
thousand tonnes!

Solution 1

Promoting the use of recycled resources

Solution 2• Technology to inject plastic in blast
furnaces

Blast furnace gas(fuel gas) used as
in-house energy

Solution 3

Offering recycled products

Recycling resources• Recycling used batteries through an electric furnace toseparate metals such as iron, manganese, and zinc

• Recycled plastic products such as palettes and NF boards

Solution 4

Used plastic

Iron ore
Fe+O

Pig ironFe

Plastic
C+H

Reduction
gas
CO+H2

Recycling

Electrode

Recoveringzinc• Recycling fluorescent lights, batteries, home electronic appliances, etc.
(treating hazardous materials for recycling)• Recycling PET bottles to produce resins
Waste
batteries

Scrap

Arc
Pig iron
Pulverized plastic

Blast furnace facility

Molten steel
Recovering iron and manganese

Water
recycling rate:
93.0%!
Rate ofefficient use ofco-products:
Initiative 3
99.7%!

Solution 5

Solution 6

Using renewable energy sources

Efficient use of co-products• Waste power generation, biomass
power generation• Recycling food waste, biogas
generation from sludge• For cement material, etc.

Initiatives for Realizing a Recycling-oriented Society
Initiative 1

Initiative 2

Improving the iron andsteelmaking process

Recycling/power
generation business

Improving the iron andsteelmaking process

In the iron and steelmaking process,promote the efficient use of raw materials
and water resources, reduced generationand emission of co-products and reuse ofco-products, and use of recycledresources and recycling of resources.

Engaging in a power
generation businessusing heat and gas
produced whentreating wastes.

In the iron and steelmaking process,promote the efficient use of raw materials
and water resources, reduced generationand emission of co-products and reuse ofco-products, and use of recycledresources and recycling of resources.

Initiative 4

Global circulation of scrap
Contributing to the expansion of arecycling-oriented society at a
global scale by efficiently
recovering and transporting ironscrap.

On-site recycling
rate of industrial
waste: 98.3%!

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Shared Initiatives

Develop resource recycling
technologies and products

Collaboration withadministrative entities

Develop technologies andproducts that efficiently use
co-products generated in theGroup’s production process aswell as wastes generated duringsocial activities.

Established a new local-based
power company in collaboration
with an administration to promotelocal generation and local
consumption of electricity throughwaste power generation, etc.

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Water Security
Basic Policy
The JFE Group uses large quantities of fresh water for cooling and cleansing products and facilities in its core businessof steel manufacturing. For this reason, the efficient use of water resources with due consideration to the source of thewater and stakeholders in the area is a key challenge. In response, we have established a system for reducing water
intake by maximizing the use of recycled water at our steelworks, and we manage the system by setting high goals forwater recycling rates.
And while we have always taken measures against meteorological disasters such as droughts and floods at our
manufacturing sites in Japan, we are further reinforcing them in anticipation of the increased frequency and severity of
weather events associated with climate change by securing alternative means and raising the height of embankments.
We also seek to identify water-related risks throughout our business sites and supply chain in Japan and overseas, suchas the risk of drought at the source of water intake and pollution at the point of discharge. In areas under water stress,
we will respond appropriately through dialogue with stakeholders.

Response to Water Risks
The JFE Group recognizes the issue of water resources as a risk that may significantly impact operations, and we havetaken action against meteorological disasters such as droughts and floods. In recent years, we have been seeking toadequately identify and manage water risks based on the assumption that disasters due to climate change will increasein frequency and severity.
With regard to Group risk management, the JFE Group Environmental Committee, under the leadership of theCEO, who heads the JFE Group CSR Council, discusses, supervises, and guides Group-wide environmental initiatives,
including the proper use of water resources.
As part of overall risk management, we identify, analyze and evaluate water risks based on past incidents of droughts
and floods in the JFE Group’s businesses, forecast data from the Meteorological Agency and results of our scenario
analysis. In particular, we consider damage to business sites and disruption of the supply chain caused by restrictions onwater intake due to droughts or increasing severity of meteorological disasters as key risks. In response, we are further
reinforcing measures such as using recycled water, securing alternative means, and strengthening drainage facilities.
Furthermore, to ensure the stability of our steel business’s procurement throughout its supply chain, we are striving
to reduce risks by evaluating them based on past data concerning water-related disasters and results of scenario analysis
for materials such as coal and iron ore, securing alternative routes of procurement and diversifying suppliers.

S

T JFE Steel

Water Risks and Mitigation
JFE Steel identifies and evaluates water-related risks based on past incidents of damage caused by droughts and floods,
forecast data from the Meteorological Agency and results of scenario analysis. We conduct a further evaluation of water
risks around each manufacturing site from different perspectives by also using the World Resource Institute (WRI)’s
Aqueduct, a mapping tool for evaluating overall water risks from droughts and floods in each region around the world.
According to the WRI’s assessment in June 2021, water risks for all of Japan are not designated at a high level or above,
but there will be risks of water shortages and flooding due to weather conditions in the future (2030s and 2040s). JFE
Steel identifies steelworks under such weather risks and takes measures such as business continuity planning.
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Efficient Use of Water Resources
The JFE Group has established a system at each manufacturing site, including steelworks, for reducing water intake tomaximize the use of recycled water, and each steelworks manages the system by setting goals for water recycling rates.

S

T JFE Steel

Cyclic Use of Water
A large amount of water is used in the iron and steelmaking process to cool facilities and process products. The target
water recycling rate at JFE Steel is 90% or more, which is extremely high considering the amount evaporated whenwater is used. We are striving to improve the recycling rate by adopting purification processes such as biological andchemical wastewater treatments, and we have been successfully achieving the target. Our recycling rate of industrial
water in FY2020 maintained a high level of 93.0%.

■ Industrial Water Accepted/Circulated(Million tonnes)
400■ Industrial water accepted by JFE Steel (non-consolidated)● Industrial water circulated*¹ by JFE Steel (non-consolidated)

93.5

93.8

93.5

93.4

93.0

(%)

100
Target:90% orhigher 75

300

220

213

218

221

215

200

50

100

25

0

2016

2017

2018

2019

2020 (FY)

Total amount

3,414

3,410

3,376

3,323

3,066

Industrial water
accepted

213

220

218

221

215

0

JFE Steel(Million
tonnes)(Million
tonnes)Group companies*2
Total amount

339

280

289

293

265

Industrial water
accepted

25

21

20

20

21

*1 Industrial water circulated (%) = (Total amount used −industrial water accepted)/total amount used ×100
*2 25 JFE Steel consolidated subsidiaries in Japan.

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PolicyN JFE Engineering

Water Consumption
JFE Engineering and its subsidiaries strive to efficiently use water in their business operations at each site.
■ JFE Engineering Group’s Water Consumption for FY2020
Other: 0.1

J Farm:31

J&T Recycling: 1,164

JFE Engineering:72

Tohoku Dock
Ironworks:
33

Total:
1,300 thousand
tonnesData cover JFE Engineering and 7 consolidated subsidiaries inJapan.
For more on quantitative data related to water, please refer to the following information.
Environmental Data (P.198)

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IndicesPrevention of Pollution
Basic Policy
The JFE Group regards co-existence and mutual prosperity with local communities, the global environment, andsociety at large as a critical managerial challenge in terms of business continuity. It strives to control air and waterpollutant emissions and aggressively invests in environmental protection. Related internal controls and education are
steadily being strengthened as well. Also, the transfer and widespread application of proprietary technologies, mainly indeveloping countries, contribute to pollution prevention on a global scale.

Controlling Air Emissions
S

T JFE SteelJFE Steel is controlling emissions by installing low-nitrogen oxides (NOx) burners in reheat furnaces, switching to lowsulfur fuels and deploying desulfurization and denitrationdevices in sintering plants, all major sources of sulfur oxides(SOx) and NOx emissions.
In addition, the company suppresses dust dispersion through measures that include enhancing on-site cleaning,
installing sprinklers and windbreak fences in raw material yards, and improving the performance of dust collectors.

■ SOx Emissions(Million Nm3)
40

■ Emissions by JFE Steel (non-consolidated)

36.8

30

20

6.0

4.5

4.6

4.1

4.3

3.3

1973

1990

2016

2017

2018

2019

2020

(FY)

—

—

0.03

0.05

0.04

0.04

0.03

(Million
Nm3)

10

0
Group
companies**13 JFE Steel consolidated subsidiaries in Japan.

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Indices■ NOx Emissions■ Emissions by JFE Steel (non-consolidated)(Million Nm3)
40

34.6

30

20

13.7

10.9

11.5

10.5

11.1

10.3

10

0
Group
companies*

1973

1990

2016

2017

2018

2019

2020

(FY)

—

—

0.22

0.20

0.19

0.17

0.14

(Million
Nm3)* 13 JFE Steel consolidated subsidiaries in Japan.

E

N JFE Engineering

To ensure compliance with the Air Pollution Control Law and relevant local regulations, JFE Engineering properly
manages facilities that emit soot and smoke, by regularly measuring NOx emissions, etc., at its Yokohama head office,Turumi works, and Tsu works. In addition, efforts are being made at construction sites to protect the environment throughthe use of construction machinery and on-site vehicles in compliance with the Automotive NOx and PM Law and Act on
Regulation, Etc. of Emissions From Non-road Special Motor Vehicles (Off-Road Vehicle Law).

Preventing Water PollutionS

T JFE SteelJFE Steel strives to reduce its environmental impact on waterways by thoroughly purifying water used in iron andsteelmaking processes before releasing it into public waterways or sewers. The company has concluded agreementswith the administrative entity in each area that set out more rigorous effluent standards, compared to those stipulated
under the Water Pollution Prevention Act. It also established a strict voluntary control standard to improve water quality.
For FY2020, chemical oxygen demand (COD), the water-quality index for wastewater, was 2.9 tonnes per day.

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Indices■ Chemical Oxygen Demand (COD)■ Emissions by JFE Steel (non-consolidated)(Tonnes/day)
4.0

3.3

3.2

3.1

3.0

0

2016

2017

2018

2019

2020

Group
companies*

0.13

0.14

0.17

0.15

0.17 (Tonnes/day)

2.9

3.0

2.0

1.0

(FY)

* 15 JFE Steel consolidated subsidiaries in Japan.

E

N JFE Engineering

Wastewater from the JFE Engineering Yokohama head office, Tsurumi works, and Tsu works, is released into public
waterways or sewer systems. Nitric oxide, phosphorus, and COD in the wastewater are measured on a regular basis andeffectively managed in accordance with the Water Pollution Prevention Act and Sewerage Act.
■ Chemical Oxygen Demand (COD) in Wastewater Released
Publicly■ Tsu Works(kg/day)30

23.1
Regulation (Tsu)
20

10

6.1

5.6

0

2016

2017

6.8

2018

8.4

8.7

2019

2020

This report uses the maximum value of each year.

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IndicesManagement of Chemical Substances and Emission Control
S

T JFE SteelJFE Steel lowers its environmental impact by voluntarily reducing the chemical substances it releases. Release andtransfer amounts of substances subject to Japan’s Law concerning Pollutant Release and Transfer Register (PRTR Law)
are reported in accordance with the law. In FY2020, chemical substances released into the atmosphere and public
waterways totaled 341 tonnes.
■ Release and Transfer Amounts of PRTR-registered
Substances at JFE Steel■ Amount released into atmosphere and public waterways by JFE Steel (non-consolidated)■ Amount transferred by JFE Steel (non-consolidated)(Tonnes)

4,000

2,726

3,000

2,533

2,212

1,865

2,000

1,000

0

429

516

545

481

1,694

341

Group
companies*

2016

2017

2018

2019

2020

(FY)

413

381

269

285

255

(tonnes)Amounttransferred 4,835

6,208

6,643

5,967

4,216

(tonnes)Amountreleased*18 JFE Steel consolidated subsidiaries in Japan.

The Japan Iron and Steel Federation formulated a voluntary action plan to reduce VOC emissions by 30% from FY2000
levels by FY2010. As part of this action plan, JFE Steel set a target for reducing emissions to 1,078 tonnes or less. As aresult of our initiatives, we achieved a significant reduction that exceeded the 30% reduction target in FY2010 and havebeen consistently cutting VOC emissions, by more than 50%. We will continue with follow-up efforts to prevent any
increase in emissions.
■ VOC Emissions(Tonnes)
2,000

1,541
1,500

-66%

Target: 1,078 tonnes or less
1,000

693

718

2016

2017

761

751
529

500

0

2000

2018

2019

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Major chemical substances subject to the PRTR Law for the JFE Engineering works in Tsurumi and Tsu include organic
solvents such as xylene used for painting products, manganese and its compounds generated during welding. We report
the release and transfer amounts of these substances in accordance with the law.
■ Release and Transfer Amounts of PRTR-registered
Substances at JFE Engineering(Tonnes)■ Amount released into atmosphere and public waterways (non-consolidated)■ Amount transferred (non-consolidated)

147

150

121
107
87

100

50

85

28

28

28

29

26

2016

2017

2018

2019

2020

(FY)

Amountreleased

—

—

58.4

45.4

36.7

(tonnes)Amounttransferred

—

—

5.7

5.4

12.5

(tonnes)0Groupcompanies**4 JFE Engineering consolidated subsidiaries in Japan.
For more on quantitative data related to PRTR, please refer to the following information.
Environmental Data (P.198)

PCB Waste Management at JFE
Polychlorinated biphenyl (PCB) waste is properly stored and managed at the JFE Group’s facilities. High concentration
PCB waste is treated in accordance with guidelines set by the Japan Environmental Storage & Safety Corporation(JESCO). The Yokohama Eco Clean Plant and Mizushima Eco-Works of J&T Recycling Corporation treat insulating oil
contaminated with slight amounts of PCB, helping to reduce pollutants both in and outside the JFE Group.

Products and Technologies (Protecting the Environment)
For more on products and technologies related to environmental protection, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P.94)

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Biodiversity
Basic Policy
The JFE Group recognizes biodiversity preservation as a key challenge and conducts assessments to minimize theecological impact from business activities. Our initiatives include cooperating with the community to monitor biodiversity
and carry out preservation activities around the steelworks, the key facilities for our business, and in surrounding
areas. The Group is also involved in developing iron and steelmaking slag products that can help restore the marine
environment. Furthermore, outside of our business operations, we launched a joint research program with the local
government and are conducting environment-related training for local communities.

Initiatives to Preserve Biodiversity
The JFE Group engages with members of the community in activities to preserve biodiversity.

S

T JFE Steel

Environmental Impact Assessment
To minimize the ecological impact of our business activities on surrounding areas, we are monitoring biodiversity around
all of our business sites and planting trees while also preserving rare species in the compound. An environmental impact
assessment is conducted in accordance with laws and regulations before launching construction of a new manufacturingsite or business. We assess the biodiversity of the surrounding areas as well as our premises to fully understand thesituation and to implement the necessary measures for preserving the ecosystem.

Replanted a Rare Species of Orchid Found at a Planned Construction Site
Plant No. 1 in the JFE Ohgishima Thermal Power Plant, an aging facility, was renovated and resumed operations in 2019.
Before this construction, we conducted an environmental prediction and evaluation for the renovation, in accordancewith the Environmental Impact Assessment Act and Electricity Business Act. As a result, the Kugenuma orchid, a plantlisted in Japan’s Ministry of Environment’s fourth version of the Red List as an endangered species (Threatened IIVulnerable, VU), was discovered at the planned construction site for power generation facilities. To preserve the orchids,
we replanted them in a different location of the site that had a similar environment.

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IndicesA Kugenuma orchid discovered at the planned construction
site for the JFE Ohgishima Thermal Power Plant

Firefly Festival
JFE Steel has opened its Environment Pond at the Chita Works to the community for a firefly viewing festival every year
since 2014. Children at the event have the opportunity to release fireflies. The Company is nurturing an environment that
preserves the ecosystem together with the local community, through maintaining the watering holes and its surrounding
environment within the steelworks site and these firefly viewing events.

Participants observing fireflies

Stream within the Chita Works site where fireflies are released

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Initiatives in Relation to Construction Works
For large-scale construction or construction work carried out near watersheds or mountainsides, customers and/or the
relevant authorities may conduct preliminary investigations depending on the importance of preserving the surrounding
environment. Various preservation conditions may then be required, including the protection of living creatures.
JFE Engineering respect the proposed conditions and thoughtfully consider biodiversity preservation by keeping
the impact of construction works at a minimum. For example, the company may propose a construction method thatminimizes the impact of noise or drainage pollution. For its steelworks, the status of biodiversity on its premises and insurrounding areas are checked, and necessary measures are taken to ensure preservation.

Biotope for the Children’s Learning Experience
JFE Engineering has conducted some renovation work at the JFE Dragonfly Path in the Tsurumi Works, and since 2009it has been inviting children in the community to learn about the ecosystem at a biotope, Dragonfly Pond, located along
this path.
In 2020, the JFE Dragonfly Path Fan Club, a group mainly composed of neighborhood residents, organized a research
event that involved capturing dragonflies in order to learn about their ecology and the local environment.
Furthermore, in FY2020, JFE Engineering became a co-sponsor of the “How Far Do Dragonflies Fly” forum, with theaim of improving the quality of green spaces in the Keihin coastal areas and contributing to biodiversity. The forum brings
together companies, residents, governments, and experts and conducts research activities such as capturing dragonflies
that fly in 15 green spaces and biotopes scattered throughout the Keihin Coastal Area and inland areas, tagging them,releasing them, and tracking their movements. The JFE Dragonfly Path also serves as one of the research sites.

Endorsing and Participating in External Initiatives
As a member of the Keidanren Committee on Nature Conservation, the JFE Group endorses the Declaration of
Biodiversity by Keidanren and Action Policy, and actively engages in the conservation of nature and biodiversity. It also
participates in the Japan Business and Biodiversity Partnership and exchanges information with various parties, including
NGOs, researchers, and public agencies.

For further details on external initiatives, please refer to:
The Keidanren Biodiversity Conservation Initiative (http://www.keidanren-biodiversity.jp/logo_en.php)
The Japan Business and Biodiversity Partnership (http://www.bd-partner.org/english/)

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Products and Technologies (Preserving Biodiversity)
The JFE Group endorses and participates in the Challenge Zero initiative that is being jointly sponsored by Keidanren and
the Japanese government. And we are collaborating with Yokohama City on a project that uses steel slag to improve themarine environment while also developing various products aimed at conserving biodiversity.

For more on products and technologies related to environmental protection, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P.94)
Challenge Zero (https://www.challenge-zero.jp/en/member/34)

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Environmental Communication
The JFE Group gives utmost priority to communicating with all stakeholders, including in matters relating to theenvironment.

Disclosing Environmental Data
The East Japan Works of JFE Steel discloses real time environmental data on local air and water quality. Visitors canreview this information in the first-floor lobby of the Visitor Center in the Chiba District and in the Amenity Hall and thefirst-floor lobby of the Keihin Building in the Keihin District.

Environmental data display in the Keihin District

Disclosure and Exchange of Information“ecobeing” Environmental Website
The JFE Group provides support to “ecobeing,” a web magazine operated by KLEE INC., which disseminates informationon the environment under the slogan “Let’s talk more with the Earth!” The website series “ecopeople” has featured
people from a variety of fields and also introduced JFE Group employees and initiatives. The summer 2021 issue featured“Firefly Festival” about the event organized by JFE Steel Chita Works and TABLE FOR TWO initiative in which JFE Shojiis participating as examples of the JFE Group’s environmental and social contributions. The site introduces a variety ofother initiatives focused on environmental themes as well. Please take a look at it to find out more.

Please see the following for further details.
“ecobeing” (Japanese only) (https://www.ecobeing.net/)“Firefly Festival”(Japanese only) (https://www.ecobeing.net/ecopeople/2021_summer/04.html)
Join TABLE FOR TWO (Japanese only) (https://www.ecobeing.net/ecotopics/#ecotopicsBl_3)
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IndicesSponsoring “Midori no Komichi” Environmental Diary
The JFE Group sponsors the “Midori no Komichi (Green Trail)” environmental diary project hosted by Green Cross Japan
with the hope that children will become more aware of environmental issues by keeping diaries of their activities andthoughts about ecology.

Please see the following for further details.
“Midori no Komichi” Environmental Diary (Japanese only) (https://www.midorinokomichi.net/)

Participating in the Environmental Exhibition EcoPro 2020 and the Tokyo Bay Thanks Giving Day 2020
The JFE Group exhibited its environmentally friendly products and technologies at EcoPro Online 2020, Japan’s largest
environmental exhibition, in November 2020. The theme of our exhibits was “JFE Technologies for a Sustainable Society– Produce → Use → Recycle.” The event was held online in 2020 due to COVID-19. We also exhibited at the Eco Study
Room Online, an environmental learning pavilion for parents and children, and elementary and junior high school students
to introduce the JFE Group’s environmental initiatives in an easy-to-understand manner. For the event, we also supported
Green Cross Japan by running the EcoPro EcoKids Tour for children.
In addition, we showcased our efforts to revive marine environments using steel slags and our contribution topreserving biodiversity during Tokyo Bay Thanks Giving Day 2020, an event aimed at reviving the marine flora and faunaaround Tokyo Bay and held in October.

Homepage of Eco Study Room Online

Introduction of JFE Group activities via Eco Study Room Online
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Responsibility to Customers (Provide Quality Products and Enhance
Customer Satisfaction)
JFE Group Standards of Business Conduct

1 Provide quality products and services
Earn the trust and regard of customers by endeavoring to provide safe, high-quality products and services based onsuperior technology, and by fully respecting and protecting the privacy of personal and customer information. Also,
leverage our superior technologies for the sustainable growth of the Group and society.

Quality Initiatives
The JFE Group manages quality by ensuring compliance with quality standards set by each operating company. All
manufacturing sites that require ISO 9001 certification for their quality management have been duly certified.

Strengthening Quality Assurance System

S

T JFE SteelTo serve customers by meeting their quality requirements and delivering products that boast the world’s highest quality,
JFE Steel has established a quality assurance system with advanced sensors for process monitoring, in addition to its
ongoing efforts to develop new products and advanced manufacturing technologies.
The company’s quality assurance system is being continually improved based on the Guidelines for Enhancing Quality
Assurance Systems, issued by the Japan Iron and Steel Foundation (JISF). Moreover, in an effort to enhance reliability
in its product testing, the company has introduced high-precision equipment and is working to thoroughly eliminate
human error and data tampering by automating each process, from conducting tests that include providing instructions
on testing and collating specimens to the delivery of test results.
JFE Steel has received all quality assurance certifications required for steel products, including the JIS mark andapprovals from ship classification bodies, regarding its quality management system based on ISO 9001. In response tocustomer demand, the company has also received certification under the national standards of relevant foreign countries.

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Products and services that JFE Engineering designs, procures, manufactures or constructs must comply with all required
rules and regulations, and quality must satisfy the needs of our customers. Under this corporate policy, the company
continually strives to improve the quality of its products and services.
For example, certified inspectors conduct inspections at each phase of a plant construction project, including thedesign, construction, and test-run phases. Immediately prior to final delivery to the customer, a witness inspection isconducted either in person or remotely so that the customer can be directly assured of its quality with their own eyes.
In addition, JFE Engineering has published quality-management manuals based on the specific characteristics of eachproduct and obtained ISO 9001 certification for each product category.
To further strengthen its quality assurance system, JFE Engineering uses an electronic document processing system
in its quality inspections to prevent omissions in inspection data and data tampering, and it electronically stores all
inspection data to reinforce traceability.

S

H JFE Shoji

Guided by its quality philosophy of maintaining customer trust by consistently delivering products that satisfy quality
requirements, JFE Shoji is constantly striving to enhance the level of its quality assurance for customer confidence
and satisfaction. Its processing centers in Japan and abroad are systematizing and automating operations to eliminate
human errors. Raising employee awareness is essential for preventing human error at every stage, from receiving
orders to processing, inspecting and shipping. The company continues to strengthen quality education for employees byintroducing case studies of non-conformance at other companies as well as at Group companies in Japan and abroad.
JFE Shoji also conducts a quality audit at all relevant Group companies in and outside of Japan to confirm the qualityof each processing center and to provide advice. Moreover, it follows up as necessary by continuously monitoring the
progress of improvements to maintain and enhance the level of quality assurance.

Ensuring Stable Supply
S

T JFE SteelRight up to the present day, JFE Steel has been strengthening its manufacturing base while bolstering the capabilities ofthe West Japan Works by maximizing its performance.
Under the Seventh Medium-term Business Plan, JFE Steel will pursue digital solutions to strengthen its
manufacturing base. It will also boost yield by stabilizing quality such as through the full-scale introduction of quality
prediction technology that utilizes data science based on integrated data, across the entire manufacturing process, fromsteelmaking to final processing.
Through these activities JFE Steel will stabilize facility operations as well as production and quality to continue
providing high-quality products to customers.

E

N JFE Engineering

As a licensed contractor undertaking mechanical, civil engineering, and construction work, JFE Engineering is requiredby the Construction Business Act to assign dedicated managing engineers at construction sites to oversee thetechnical aspects of construction work. The smooth implementation of plant construction projects depends on licensed
specialists. The company is always striving to secure the necessary human resources by encouraging employees toacquire qualifications by granting expenses and through mid-career hiring of licensed personnel.
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H JFE Shoji

JFE Shoji will ensure stable supply by strengthening regional marketing channels, making capital investments for theGroup and raising efficiency to realize an optimal system for sales and processing, and by conducting quality audits at
Group companies to bolster its quality assurance system.

Improving Customer SatisfactionS

T JFE Steel

Aggressive Advancement of DX
JFE Steel’s Digital Transformation (DX) strategy revolves around technological innovation based on the active introductionof IoT, AI and data science (DS) and the application of data assets. Compared to mills in other countries, we possess anenormous amount of know-how and data accumulated through many years of production operations. Our abundant data
assets are the source of our value creation.
We will harness the latest DS and AI technologies to make versatile use of such data in achieving innovative
improvements in productivity, enhancing quality and ensuring stable operations to raise our competitiveness.

■ Advancement of Digital Transformation (DX)JFE Steel’s
VisionBe a global steel supplier that always creates new value
and grows with customers

The 3 Pillars for Advancing DX

Achieve a competitive advantage through data-driven operations
Group-wide
PolicyJFE has a long history of production activity that has generated a treasure trove of data.
Our accumulated expertise in manufacturing high-grade steel, measures for aging
facilities and data on predictive management are sources of our competitive strength.
Advanced use of data is a strategic focus for JFE.

Maximize Value

1

Execute IT structural reforms
Upgrade systems at steelworks
Realize a flexible,change-tolerant IT structure

3

Synergistic
effects2

Promote business reforms andthe latest advancements in IT

Proactive use of data science and AI

Reinforce our IT risk management
Enhance security and standardized controls
Enhance the security environment for IT

Please see the DX REPORT.
DX REPORT (https://www.jfe-holdings.co.jp/en/investor/library/dxreport/index.html)

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Testing and Research Centers for Collaboration with Customers on Product Development
JFE Steel collaborates with customers in research and development. The Customers’ Solutions Lab (CSL) for auto
industry customers, the Steel Structural Materials Solutions Center (THiNK SMART) for infrastructure-related customers
and the JFE Welding Institute -Center for Integrity against Fatigue and Fracture (JWI-CIF2) are located in eastern Japan,
while the Customer Center Fukuyama (CCF), which develops materials and conducts applied technology research, isin western Japan. Using these facilities to strengthen early vendor involvement (EVI)*enables the company to quickly
identify customer needs and develop products based on cutting-edge evaluation techniques and innovative production
processes.
*Customer participation in product development is from an early stage to facilitate innovative new methods, functions,processes and evaluations for new steel materials.

Customers’ Solutions Lab (CSL)

Enhancing Our Response to Customer Needs
In an effort to strengthen the company’s total capabilities for better responding to customer needs, its sales departmentemphasizes sales education for sales personnel, from the headquarters and branch offices according to position, andfor regional employees of overseas offices. Specifically, it develops abilities in areas such as engaging in technicalconversations, picking up clues from customer relations and using them in product development, offering suggestions toimprove logistics and distribution, and analyzing financial indicators and costs. We also constantly strive to improve ourordering system to ensure that customer product specifications are accurately reflected in manufacturing.

Unified Customer Care
JFE Steel regularly conducts customer questionnaires and interviews to draft strategies for greater customer
satisfaction. Business strategies are shared among the sales divisions, the business planning functions and steelworks
to facilitate unified customer care and proposals that leverage the collective strengths of the JFE Group.

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Create and Continue to care for the Foundation of Life by Maximizing DX
JFE Engineering plans, designs, builds and operates the infrastructure that supports people’s lives and industry. Digitaltransformation (DX) is crucial for accelerating the pace of its work and for maintaining its position at the forefront of theengineering industry.
JFE Engineering will aggressively pursue DX beyond simply raising operational efficiency to fundamentally reform
its operational processes, add new functions to its products and services, and take on the challenge of developing new
businesses that utilize data, to address ESG issues and enhance corporate value.

Please see the DX REPORT.
DX REPORT (https://www.jfe-holdings.co.jp/en/investor/library/dxreport/index.html)

Engineering Company Assessments Based on Customer Evaluations
JFE Engineering uses customer surveys, interviews, and contractor performance evaluation forms to collect and assess
data on the company’s construction management, quality, advanced technologies and innovation. Each division analyzes
and applies the data for quality improvement, new product development and the overall strengthening of aftersales
service, to ultimately enhance customer satisfaction.

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H JFE Shoji

Meeting Customer Needs
To respond quickly to diversifying markets and increasingly sophisticated requests from customers, JFE Shoji isstrengthening its entire supply chain from materials procurement to processing and distribution.
Recognizing that meeting customer needs requires proposals of a higher level than what they expect, the company
also focuses on educating employees through training, in addition to actual practice and on-site experience for gaining
knowledge and expertise.
Furthermore , it will take into consideration the implementation of DX into the steel supply chain as a means ofproviding a higher degree of innovative value to its customers.
For more details related to customers, please refer to the following information.
Data on Training Related to Customer Care (P.220)

Responsible Export Practices
Each JFE operating company promotes international peace and security by working against the spread of weaponsof mass destruction and excess accumulation of conventional weapons. Specifically, the company carries out internal
inspections to confirm the final destinations, customers and applications of its exported products, and then ensuresthat export procedures are carried out properly. In addition, the Legal Affairs Department conducts internal briefings todisseminate knowledge of export-related laws and regulations, such as the Foreign Exchange and Foreign Trade Act.
Also, JFE provides education on export security controls and related measures for the employees of Group companies
involved in trading.a

Promotion of Research and Development
S

T JFE Steel

Under the Seventh Medium-term Business Plan, JFE Steel is promoting research and development of innovativetechnologies for the steel manufacturing process, such as CO2 reduction technology, carbon-recycling blast furnaces and
CCU, and hydrogen-based ironmaking (direct reduction) . These technological developments leverage data science androbotics to closely align with the needs of customers and society at large.
In addition, JFE Steel is accelerating the introduction of new products and solutions for each field, with automobiles
including EVs and new energy as key areas of R&D.

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JFE Engineering develops technology as a company that creates and continues the foundation of life . In the area ofcreating infrastructure, the company has developed proprietary high-efficiency boilers for waste-treatment and powergeneration facilities that realize stable, clean incineration treatment and generate power at the highest level of efficiency
in Japan. In the area of supporting infrastructure, JFE Engineering continues to develop technologies that collect andanalyze a range of data from the plants it operates in Japan as well as technologies that utilize AI to achieve optimalplant operation and automation. As for maintaining infrastructure, the company develops technology for upgrading andextending the operating life of facilities so that they are safe and secure for society into the next generation.
JFE Engineering plans to spend 21 billion yen in research and development over the four-year-period of the Seventh
Medium-term Business Plan.

Internal Awards
The following technical and product developments were awarded in FY2020.
■ Internal Awards (FY2020)
Prize/Award

JFE Steel

JFE Engineering

ExcellenceAward, JFE
Steel President’sAwardsGrand Prize,
JFE Engineering
President’sAwards

Project

RecipientCreation of a new overseas business
scheme through business collaboration
with JSW SteelGlobal Business
Development
Division,Business
Planning Dept.,
etc.

Shift in the product mix through thedevelopment of manufacturing and sales
system for roadbed material

Slag Business
Planning Division,
Planning &Marketing Dept.,
etc.

Initiatives for maintaining and raising
efficiency for land-based transport
functions—Leading the industry (Japan
Iron and Steel Foundation , trading
companies and other companies) to
break with longstanding businesscustoms

Logistics Division,etc.

Development of an integrated
manufacturing system for the reliablesupply and sales expansion of oil wellpipes made of high-grade chromium
steel

Products Service& Development
Dept., Chita
Works, etc.

Zero-coke operations for waste gasifying
and melting furnaces —Major step
toward commercialization of green
technology

Environmental
Solutions Sector

For more on external awards, please refer to the following information.
External Awards (P.236)
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IndicesOccupational Health and Safety
Initiatives on Employee Health and Safety
Providing for the health and safety of employees is a basic requirement of companies, particularly manufacturers, and isfundamental to the continued existence of any company. The JFE Group adheres to the philosophy of safety first, and,
together with its group companies and suppliers, works to consistently maintain safe working environments and secure
workplaces for all employees.
Under the Seventh Medium-term Business Plan, we will strive to achieve our goal of zero Workplace fatalities . In
particular, we will prioritize safety investments (around 10 billion yen per year Group-wide) to reduce risks by making
workplaces inherently safe. We will also promote multifaceted occupational employee health and safety, including
monitoring and detection, by harnessing advanced IT solutions.
Efforts to ensure safety at the operating companies are regularly reported to the Board of Directors, which provides
direction and supervision.
Data related to Lost-Work Injuries, see:
Data related to Lost-Work Injuries and Accidents (P.220)

Training Programs for Health and Safety
The JFE Group organizes seminars for newly appointed managers and supervisors to provide information on the
Industrial Safety and Health Act and risk assessment regulations and on formulating work plans and policies for healthand safety management. In the construction operations department, we offer programs for local superintendents incharge of construction work (Overall Safety and Health Controller ) centered on the Industrial Safety and Health Act aswell as related regulations for subcontractors and the Construction Business Act (331 participants in 2020). We also
conduct new employee training and position-specific training on mental health (749 participants in 2020).

Initiatives for Health and Safety by Business Segment

S

T JFE SteelIn 2021, we are following two basic strategies: practicing autonomous safety activities while developing communication
between employees and business associates and taking action based on the Group’s Health Declaration. In accordancewith our goal of attaining the highest level of competence in the industry, management supervisors make a point to visit
work sites every day, while workers are striving to handle their tasks with discipline. We are also proactively applying IT,
such as by introducing safety monitoring systems* for safety management.
To date, we have implemented safety activities based on the advice from Du Pont. We are going to develop these
activities into an occupational health and safety management system in accordance with the ISO 45001 international
standard as we seek to establish a corporate culture of safety that is voluntary and independent. We are working toward
our goal of obtaining certification for all our construction and operating sites during FY2022.
To mitigate or prevent disaster risks, JFE Steel conducts risk assessments at the planning stage for new facilities aswell as prior to their regular and non-regular repairs. We also constantly strive to make each facility safer so as to lower
the risk level for our workers.
We respond to industrial accidents by setting up a disaster investigation committee to determine the cause and offer
recommendations for improvement to the department in charge of implementing countermeasures. At the same time,
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we inform the relevant departments and labor union through the Occupational Safety and Health Committee, while thedepartment in charge implements and reports on countermeasures, which is a mechanism designated by companywide rules. In the event of severe accidents, a response is deployed across the company, and a standard progress report
is submitted to Corporate Officer Council until countermeasures have been completed. This practice has also beenstandardized across the entire company.
In addition, we immediately report accidents to the Japan Iron and Steel Federation (JISF) under the guidelines forreporting industrial accidents. We file an update once we have determined the cause and decide on countermeasures.
We also promptly submit a report on safety, disaster prevention and environmental issues to the Ministry of Economy,
Trade and Industry, the Ministry of Health, Labor and Welfare, and the JISF.
*A system that provides managers with information about, for example, carbon monoxideconcentration and oxygen
concentration in real time along with the location information of workers.
■ Governance Structure for Health and Safety
Corporate Officer Council(report and deliberation)
Executive Vice President in charge of Company-wide
Safety Council
Chiefs and Deputy Chiefs
Information sharing and support

Office of Safety and Health Manager(activities and information sharing)(Consideration of horizontal
communication measures)

Site management
Chiefs and Deputy Chiefs
Safety and Health Division
Manufacturing Division
Suppliers

Health Department(head office)Internal audit

Collaboration

ISO45001

E

Group companies

Japan Iron and Steel Federation
External Evaluation Institutions

N JFE Engineering

In addition to setting up governance organizations for health and safety at each operating site to comply with theIndustrial Safety and Health Act and in line with the type of work and number of employees, JFE Engineering has
established a governance structure for health and safety at each operational headquarters to facilitate and effectively
implement company-wide management at its construction and operating sites and manufacturing plants. JFE
Engineering strives to eliminate disasters at all suppliers and Group companies by establishing priority items to be sharedacross the company and to which all employees and all staff at suppliers adhere. It also endeavors to identify sources ofdanger as well as safety measures through risk assessments aligned with the particular characteristics of each individual
operational headquarters. Meanwhile, it promotes physical and mental health and the creation of comfortable working
environments as a means of ensuring the health of employees and bringing occupational health to an overall higher level.
In the event that an industrial accident occurs, occupational health and safety managers will meet to determine thecause and consider countermeasures that will be deployed across the company. Since 2016, the company has been
operating an occupational health and safety management system (ISO 45001 certified) for its construction activities
in Japan and overseas as well as its manufacturing operations at the Tsurumi and Tsu Works. As a new initiative, JFE
Engineering applies IT solutions promoting occupational health and safety, including monitoring and detection by multiple
approaches.

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H JFE Shoji

JFE Shoji is actively working on eliminating unsafe operations that could lead to severe accidents and targeting zero
severe accidents at its processing sites such as coil centers.
The company encourages compliance with rules among employees by implementing measures such as (1) risk
assessment involving on-site patrols by management supervisors for identifying unsafe operations or hazard prediction
by staff responsible for each operation, (2) comparative study of similar disaster cases and hazard experience training
for improving the ability to recognize and avoid unsafe operations, (3) facility improvement for reducing risks, including
installation of safety sensors, and (4) operation training (slinging for cranes and other skills) and review of operational
standards.
Furthermore, for each of its Group companies, JFE Shoji assigns a safety manager to spearhead these efforts to raise
the level of health and safety activities. To ensure that all JFE Shoji Group companies operate under the same values,
safety managers meet every other month to share knowledge and information on occupational health and safety.
All lost-work injuries must be reported to the top management from the president of each Group company as part of
the JFE Shoji Group-wide effort to address safety management. Annual safety awards are also presented to encourage
employees to actively engage in health and safety activities. Through these initiatives, the company will raise the level ofsafety management within the JFE Shoji Group and continue to maintain safe working environments.

Employee Health
The JFE Group seeks to create safe, attractive environments where everyone can enjoy working and aggressively
promotes the establishment of environments in which personnel with diverse backgrounds can demonstrate their fullpotential. To that end, it has developed the JFE Group Health Declaration and collaborates with its health insurance union
and industrial health staff to strengthen employee health so that everyone can work with vigor.

JFE Group Health Declaration

1 J FE, recognizing that safety and health are fundamental for fulfilling its mission, creates workplaces in which
every employee can work with vigor.
2 J FE and its health insurance union work together to advance initiatives for maintaining and upgrading thephysical and mental health of employees and their families.
3 J FE gives top priority to safety and health and to creating a health culture in which each employee takes personal
responsibility

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Physical Health Initiatives• Ensure the implementation of regular physical examinations and strengthen cancer screenings.
• Prevent aggravation of lifestyle diseases by conducting metabolic syndrome checkups and offering healthguidance.
• Utilize the health insurance union’s health promotion app, PepUp, to educate employees on physical exercise andother healthy habits.
• Promote non-smoking areas and maintain separate areas for smokers and non-smokers in buildings. Provide
guidance to help employees quit smoking through industrial physicians and public health nurses.

■ Metabolic Syndrome and Smoking Rates（％）● Metabolic Syndrome Rates

38
36
34

35.4
33.2

35.9

32.6

36.0

31.7

32

● Smoking Rates

36.5
35.6

31.1
30.0

30
0

2016

2017

2018

2019

2020

(FY)

Maintaining and Promoting the Health of Employees’ Families
The JFE Group works with the health insurance union to maintain and improve the health of employees and their families
by, for example, encouraging spouses to undergo health examinations. The rate of health examinations for dependents(age 40 or older) has been steadily increasing to 46.3% in FY2020, up 8.7 points from 37.6% in FY2014.

For employee health data, please refer to the following information.
Employee Health Data (P.222)

Mental Healthcare
The JFE Group conducts four basic initiatives to maintain the mental health of employees: “self-care” for workers who
strive to remain aware of stress and take preventive measures; “care by management supervisors” who provide advice
to subordinates; “care by industrial health staff” who support employees, managers and supervisors; and “care byhuman resources outside workplaces,” including specialist clinics and individuals.
JFE’s health insurance union also provides mental health counseling, including a 24-hour hotline for employees andtheir families (spouse and dependents).

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Initiatives on Health Issues
We operate a health management system for effectively managing the health of all employees, including those on
overseas assignments and business trips and those studying abroad.
We particularly seek to ensure that employees working abroad can maintain a healthy lifestyle, along with theiraccompanying family members, by conducting health checkups and vaccinations before they move overseas. In aproactive effort to prevent infections, we also provide information on global health issues such as COVID-19, HIV,tuberculosis and malaria during assignment briefings. We will continue to monitor and appropriately respond to global
health issues.

S

T JFE SteelDevelopment of the Health and Productivity Planning Management Promotion System,
Company-wide Goals and Follow-ups
To drive initiatives regarding maintaining and improving the health of employees and their families, JFE Steel launchedthe Health and Productivity Management Promotion WG upon the establishment of its Group Health Declaration in 2016,
and it is monitoring the achievement of medium-to long-term goals.
■ JFE Steel’s Company-wide Targets (2021)
Targets

Thorough implementationof physical examinations

2020 Results

Rate of complete exams: 100%

63.7%

Rate of complete exams for dependents: 60%

48.0%

Rate of providing specific health guidance: at least 70%

53.0%

Rate of obesity (BMI: 25% or higher): 25% or less

30.2%

Smoking rate: 27% (2% annual reduction)

29.0%

Preventive health Measures

Promotion of non-smoking

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Policy■ Health and Productivity Planning Management Promotion System
JFE Holdings

JFE Steel

Health and Productivity PlanningManagement Promotion Committee(Chaired by an Executive Officer)

Health and Productivity Management
Promotion Subcommittee

Company-wide Industrial
Physicians Subcommittee•Health and Productivity
Management Promotion WG•Company-wide Industrial
Physicians Meeting

Industrial Health Staff
Subcommittee

Health Insurance Union

Health Staff
Subcommittee•Industrial Health Staff Meeting •Health Managers Meeting•Health Audit■ Health and Productivity Management Promotion WG

Members• Industrial physicians and public health nurses• Manager of Labor Management Office, Labor Management
HR Department, Organizational HR Department• Office of Safety and Health (health staff), Safety and Health
Department• Each region, works,
main office• Health Insurance Union• Directing Manager, Manager of Health Development Office• Evaluation of Health and Productivity Management (physical, mental and work environment)
Discussion
topics

Evaluation of indices and activities:• Company-wide activities• Reporting to the management teamFrequency

February, May, August, November (once a quarter)

Active Exercise
JFE Steel business sites offer the Active Exercise program, which the West Japan Works designed to help people
increase their physical strength and prevent injuries due to falling. The program’s effectiveness in preventing
occupational accidents and improving health has even attracted attention outside the company, so it is being actively
shared not only among Group companies but also with on-site suppliers and companies in a broad range of industries.

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Engineering Activities for Boosting Health Based on Health Checkup Data
JFE Engineering is pursuing initiatives for improving health focused on five domains, including sleep, smoking andobesity issues extracted from past health checkup data, along with cancer and mental health.
■ Health and Productivity Management Promotion System
President
Management Strategy Committee
Management Committee

JFE Holdings
Health and Productivity Promotion Leader(director in charge of human resources)

JFE Health Insurance Union
Collaboration
Labor union

Human Resources Department
Health Management Center

Group companies
Supervising industrial physician
Industrial physicians

Public health nurses

Company-wide Industrial
Health Staff Meeting
Central Occupational Health and Safety Committee
Offices and branch offices Occupational Health Committee■ Initiatives Based on Past Health Checkup Data
Year
Launched

2018

Purpose

Initiatives

Strengthen cancer checkups

Stomach endoscopy during regular health checkups

Encourage a better
understanding of healthconditions to nurture awarenessand promote behavioral changes

Interviews with public health nurses for all new employees

Measures for preventing passive
smoking

Designate the 22nd of each month as a day for making an effort
to stop smoking

Promote self-care among all
employees

Self-care seminars to practice methods for raising concentration
through short naps and breathing techniques

Address obesity

Recommend increased physical exercise by displaying thecalories consumed by climbing stairs and healthy strides

2020

Address obesity

RIZAP seminar co-sponsored by labor and management anddoing workplace exercises for the home to address remote work
conditions

2021

Measures for preventing passive
smoking

Smoking prohibited in all indoor spaces

2019

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Indices■ JFE Engineering’s Company-wide Targets
Key Domains

FY2021 Company-wide Targets

FY2020 Results

Measures related to sleep

Sleep-related risk: 35% or lower

37.2%

Measures related to passive
smokeCompany-wide smoking rate: 22.3% or lower

23.3%

Measures related to obesity(preventing severe cases)

Obesity rate: 38.3% or lower
Provision of health guidance: at least 40.0%

40.7%
39.1%

S

H JFE Shoji

Detecting Illnesses at an Early Stage, Maintaining and Promoting Health for Employees and their Families
Based on the belief that the health of employees and their families holds the key to the further development for thecompany, JFE Shoji is working to create workplace environments in which employees can work with vigor.

■ Health and Productivity Management Promotion System
President
Management Committee
CSR Promoting Conference
Health and Productivity Leader(director in charge of the Human Resource Department)

JFE Holdings
Branch Health Committees

Industrial physician
Labor union
representatives
Staff in charge ofhealth management(human resources,
general administration)

Collaboration

Exchangemeeting ofindustrial
physiciansCompany-wide Occupational
Health Committee

Supervising Industrial Physician
NursesLabor union representatives
Staff in charge of health management(human resources, general administration)

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Collaboration

JFE Health Insurance Union
Group companies

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Policy■ Past Initiatives
Year Launched

Purpose

Initiatives

Helicobacter pylori tests conducted during regular
health checkups
Prevent cancer
New program for subsidizing examination fees forbreast cancer and uterine cancer

2018

Raise employee health awarenesse-learning program conducted on the importance ofregular health check-ups and heart and brain disease

2019

Prevent lung cancer and stroke
Measures related to passive
smoke (reduction in smoking rate)

New program for subsidizing smoking cessation clinic
fees

2020

Encouraging employees toexercise as a habit

Encouragement for participation in the Powering Up
Health Care program■ JFE Steel’s Company-wide Targets
Category

FY2021 Goal

FY2020 Result

Rate of providing specific healthguidance

50% (FY2023 goal: 60%)

41.6%

Rate of complete healthexamination for spouses

60%

53.2%

Smoking rate

23.9% (1% annual reduction)

24.9%

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Response to the COVID-19 Pandemic
The JFE Group is addressing the COVID-19 pandemic through a variety of measures against infections from theperspectives of securing the health and safety of employees as well as avoiding business continuity risks. Each company
practices thorough health management, including the wearing of masks, washing and disinfecting hands and monitoring
body temperature. We also encourage teleworking as much as possible and promote off-peak commuting based on
flexible workstyles without setting core work hours. We have installed partitions in offices and conference rooms, havebeen limiting the number of persons entering each room, and are also promoting online meetings in addition to othermeasures for avoiding crowded conditions.
Nonetheless, the steelworks and waste incineration facilities of JFE Steel and JFE Engineering must continue theiroperations even under a state of emergency, and the following measures are taken to prevent infection.
We minimize the number of participants attending meetings required for safety and operational management bydividing them into groups while also taking care to avoid gaps in communication with regard to necessary information.
During these meetings, we seek to avoid crowding while providing adequate ventilation, limiting attendance to theabsolutely necessary number of personnel and maintaining distance between participants. We also adhere to industry
guidelines and conduct thorough daily checks of employees’ physical conditions.
In the lounge areas, we place vinyl sheet partitions at the center of the table to avoid that people do face each otherwhile sitting. Each work site is striving to avoid physical contact by adopting measures such as creating push-rods bearing
employees’ names for pressing the buttons of drink servers.
Other measures include limiting the number of employees coming to work by dividing them into three groups tostagger commuting.
In addition, to prevent infections from spreading and contribute to reducing the local government’s burden of
conducting vaccinations, we have been actively cooperating with the workplace vaccination program. We have applied tohave about 23,000 people affiliated with JFE Holdings inoculated and are proceeding with vaccinations at each operatingcompany.

On-site meetingGroup meeting

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PolicyLabor Standards (Recruit and Nurture Diverse Human Resources)
JFE Group’s Basic Policy on Human Resource Management

1 Respect Human Rights and Facilitate Fair Management of Human Resources
The Group manages human resources fairly by respecting the human rights of all employees and nurturing
employees who embrace the Group’s corporate values and standards of business conduct.
2 Foster a Corporate Culture that Nurtures People and Promotes Satisfying Workplaces
The Group facilitates interactive communication among employees to cultivate a corporate culture that nurtures
human resources and creates safe, attractive environments where everyone can enjoy working.
3 Diversify Human Resources
The Group ensures that diverse all people, including women, non-Japanese, the elderly and the disabled, candemonstrate their full potential.
4 Recruit and Steadily Nurture Excellent Human Resources
To survive in an increasingly complicated and diversified business environment, the Group steadily recruits diverse,
high-quality skilled human resources, ensures that they receive the skills and knowledge necessary to continue
strengthening the Group’s technological capabilities, and nurtures their global capabilities.

Posters displayed at each workplace

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Workstyle Reform
To ensure the sustainable development of the JFE Group, it is essential to fundamentally review past customs anddevelop workstyles that enable each employee to be highly productive in creating new value with pride and satisfactionin their work. Under the Seventh Medium-term Business Plan, we intend to continue building workplace environments
and internal systems that enable employees to fully demonstrate their abilities with a sense of security and safety.

S

T JFE Steel

Promoting a New Workstyle (Smart Work JFE)
To address its varied management issues, JFE Steel is accelerating its efforts to enhance productivity and will meet thediversifying workstyle needs of employees.
As society responded to the state of emergency declared under the COVID-19 pandemic, new lifestyles andworkstyles became widespread. This was also true at JFE Steel, where employment styles that combine working at
the office and at home have become applied, mainly at the head office and branches. Employee values on workstyles
have also significantly changed. Seizing this as an opportunity to move beyond its response to COVID-19, JFE Steelis promoting its new workstyle (Smart Work JFE) to maximize employee productivity and output and to enhance
engagement. In concrete terms, we will promote teleworking by expanding our work-at-home systems; introduce chatand web conferencing tools and robotic process automation (RPA), a software program that facilitates the automation ofwork done on terminal devices; promote paperless offices; eliminate the use of seals by applying workflow automation
software; introduce a coreless flexible working hour program to shift to a workstyle with higher added value; andtransform our corporate culture.
In addition, JFE Steel seeks to enhance the work-life balance by encouraging employees to take paid leave by
designating annual planned leave days and offering a work-life-balance vacation program to support employees in taking
vacations for personal life events, self-enlightenment, or participation in volunteer activities.

E

N JFE Engineering

Enhancing Productivity with New Workstyles
JFE Engineering is promoting “vacation-style reform” across the company. Employees are encouraged to take Fridays
off during the summer and consecutive days of paid leave following the completion of construction work. Out of 22 paid
leaves granted, 17 paid leave days on average were taken by employees in FY2020. The company intends to raise thisnumber to 20 in FY2021.
As part of its workstyle reform, JFE Engineering has introduced a flexible working hour program for offices, inwhich employees determine their own core work hours. Under this program, the company designates days on which
employees must leave the office on time and in principle prohibits overtime work after 8 p.m. to encourage employees tomore efficiently use time. Teleworking, which was introduced as a preventive measure against COVID-19 infections, wasadopted as a permanent system from FY2021. Employees can work at home or at any of the roughly 400 shared offices
nationwide, thereby supporting flexible workstyles.
In the area of construction, JFE Engineering is making greater use of IT at construction sites and expanding
operational support provided by the back office to fully adopt a five-day workweek.

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Initiatives to Support Various Workstyles to Realize a Work-life-balance
As a measure to realize a work-life-balance, initiatives have been implemented to reduce work hours, such as designating
Wednesdays as the day to encourage everyone to leave on time, prohibit all work after 10 pm, and also designating days
when employees are encouraged to take paid leave.
To support more diverse workstyles, JFE Shoji changed its flexible working hour program in April 2016 by setting thecore worktime between 11 am to 2 pm, and by introducing work-at-home systems for employees pressed for time due
to childrearing or nursing duties. The company also implemented a program called Challenge Days as a trial, in which
employees can experience teleworking and shared offices, regardless of their time constraints.
During the COVID-19 pandemic, JFE Shoji has been flexibly applying its system, which includes expanding eligibility
for working at home to all employees and temporarily adopting a flexible working hour program without core hours.
Looking beyond COVID-19, the company set up a project team to explore new workstyles that are even more efficientand flexible, and it will consider promoting paperless offices based on digitization and developing offices that meet theneeds of the new normal.

Operational Reforms
S

T JFE Steel

Promoting Operational Reforms that Leverage the Newest ICT
To reduce employee time spent on simple for repetitive tasks and free up more time for creative work, JFE Steel
implemented RPA, a software to facilitate the automation of human work done on terminal devices.
As of FY2020, RPA was deployed in over 300 types of operation, releasing over 49 thousand hours to be spent onother productive work.
In FY2021, JFE Steel will expand the scope of in-house development it began in the latter half of FY2020 to speed up
its response to further labor savings and changes in operations to boost competitiveness.
JFE Steel is pushing ahead with a companywide project launched in FY2016 to upgrade mission-critical systems ateach steelwork toward promoting operational reform as well.
The company will actively engage in operational reform by leveraging the newest ICT and use the time generated by
the operational reform to improve customer service.

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Smart-Work Project
JFE Engineering has been steadfastly developing workstyle reform, spearheaded by the Office of Smart-Work Promotion
set up in FY2018.
Prior to turning remote work into a permanent system starting in FY2021, the company introduced an electronic seal
system for all employees to eliminate the need to come into the office to apply the seal. As a result, more than 10,000
documents were digitized each month, reducing paper use by 40%. In addition, RPA, used to automate 211 tasks as of
FY2020, and automatic translation tools increasingly being used by overseas divisions, have also contributed to raising
operational efficiency.
By introducing various systems, measures and tools to boost efficiency, JFE Engineering aims to achieve both worklife-balance and improved productivity while maximizing overall output.

S

H JFE Shoji

J-SLIM Activities
JFE Shoji will continue to drive its J-SLIM activities, which is an operational reform aimed at increasing work efficiency
and performance. Introduced in 2018, RPA is now being applied across the company to effectively improve productivity,
demonstrating results such as reducing the time taken for operations by 46,000 hours per year, or 3,800 hours permonth, through automation, and expediting the provision of services. The company is also focusing on developing newwork environments using the latest IT tools to digitize internal processes. Spurred by dramatic changes in the businessenvironment that began in 2020, it will further accelerate the pace of its operational reforms toward developing newworkstyles in line with the changing times to create a corporate culture that encourages continuous innovation.

Invigorating Workplaces through Small Group ActivitiesS

T JFE SteelJFE Steel has approximately 1,500 small groups that carry out J1 Activities* that have yielded various results in the
key areas of quality and work improvement. In addition, the JFE Family Result Reporting Conference, which includes
participation from Group companies, is held twice a year, and groups that excelled in the competition are dispatched to
QC Conventions and affiliated companies in Japan and overseas to strengthen the J1 Activities.
*Designed to turn JFE into an excellent company and propel it to the number one position in its industry (called JE1
Activities at JFE Engineering and J1 Activities at JFE Steel and JFE Shoji).

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JFE Engineering has about 160 teams and 1,400 employees, including those of group companies worldwide, involved in
JE1 Activities. The results of these activities are showcased at a company-wide competition held at the end of the fiscal
year. Activities focused on topics such as quality, efficiency, safety or costs contribute significantly to workplace vitality
and corporate performance.

S

H JFE Shoji

JFE Shoji has been conducting J1 Activities in production divisions of its group companies in Japan as a means ofimproving their problem-solving skills in areas such as safety, quality, cost, operations and delivery target. The company
holds annual competitions in which about 20 teams report their activity results and awards are given to the highest
achieving teams. The company will continue to promote J1 Activities to improve workplace vitality and improve problemsolving skills. The result of these activities are shared among Group companies.

Workforce Diversity
By designating workforce diversity as a key business objective and to address the ever-evolving business environment,
the JFE Group is promoting efforts under the Seventh Medium-term Business Plan to maximize the potential of
employees regardless of gender, nationality, creed or lifestyle.
Given the growing need in recent years to ensure diversity among managerial personnel, it is becoming increasingly
important to secure diverse and excellent human resources, including women, foreign nationals, and mid-career recruits.

Structure for Promoting Diversity
To ensure the consistent promotion of diversity, each operating company has a Diversity Promotion Section to organize
educational activities, such as rank-based training and women’s exchange meetings, and to share and implement bestpractices across the Group.

Key Diversity Initiatives at Each Operating Company

S

T JFE SteelJFE Steel provides career support and management training for managers and other employees to cultivate a culture
in which diverse human resources can demonstrate their full potential. About 400 women currently work on-site at
the steelworks, mainly in workplaces that operate in shifts. To meet needs associated with childbirth and childcare,
workplace nurseries have been set up in four areas in Eastern and Western Japan by 2019. In FY2020, the company
established a program for helping employees maintain their work-life balance by discussing their career development
through interviews with their supervisor and the personnel division. In this way, JFE Steel is creating a workplaceenvironment in which women can continue working after childbirth or periods of childcare or nursing care.
The company intends to further expand areas in which women can advance their careers by organizing training for
employees about to take on managerial positions to strengthen the required skills and by formulating individualized
career assignments and development plans to respond more closely to their needs.

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JFE Engineering engages in activities for reforming its corporate mindset, including diversity seminars for managers,
e-learning programs for all employees and the annual Diversity Month. In FY2021, a Diversity Committee comprising themanagement team was established to deploy company-wide policies and set targets for each organization. For female
employees, the company organizes leadership seminars and opportunities for exchange. It also accepts around 80
locally-hired employees of overseas Group companies at any given time to provide on-the-job training. The company also
strives to create an environment in which workers can spend their time in Japan with a sense of security, by launching a
helpdesk on daily matters for non-Japanese nationals, offering information through a portal site and providing Japanese
language classes. Every year in Japan, JFE Engineering actively hires around 70 mid-career recruits possessing diverse
characteristics and values, such as those with experience in other industries.

S

H JFE Shoji

JFE Shoji intends to foster a corporate culture that embraces and utilizes diverse human resources and workstyles byimplementing diversity seminars for top management and diversity management seminars targeting managers, including
managers at Group companies.
JFE Shoji also strives to support women’s career development, which includes providing a mentor program for new
female employees in career-track positions and seminars for next-generation female leaders. In June 2021, it received
the three-star Eruboshi certification from the Ministry of Health, Labor and Welfare in recognition of its excellent
initiatives for promoting women’s career development.
To ensure that women can continue working after childbirth or periods of childcare or nursing care, the company organizes
information exchange meetings for employees on maternity leave and follow-up seminars after they return to work.
It also fosters global human resources and promotes exchange through measures such as management seminars inJapan for national staff at overseas bases for promoting them to leadership posts, creating an environment in which
diverse human resources can pursue their careers with vigor.

Supporting Women in Professional Development
Formulation of an Action plan for Promoting Women’s Professional Development
The Act on Promotion of Women’s Participation and Advancement in the Workplace went into effect on April 1, 2016.
The JFE Group has designated the promotion of workforce diversity as a key management strategy for maximizing
the potential of every employee and has been actively hiring and supporting the advancement of female employees.
In our latest move, we formulated the following action plan in accordance with the Act to establish a work environmentthat encourages female employees to demonstrate their abilities and create satisfying workplaces for all employees.

Action Plan Period
Period of five years starting on April 1, 2021 and ending on March 31, 2026
Target of the Action Plan
JFE had set a common Group goal of tripling the number of female officers and managers from levels in August 2014 by
2020. However, we were able to attain this goal in advance by April 2019.
We have already set a new goal of increasing the number of female officers and managers five-fold from levels in
August 2014 by 2025, and we will continue to promote women to managerial positions.
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Action Plan for Each Operation Company
JFE Steel (Japanese Only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_st.pdf)
JFE Engineering (Japanese Only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_eng.pdf)
JFE Shoji (Japanese Only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_shoji.pdf)
Initiatives for Supporting Women in Professional Development
The JFE Group is implementing a broad range of initiatives to support female employees, such as increased hiring,enhanced childcare-support programs that significantly exceed statutory requirements, and training and education.
Furthermore, the initiatives and issues faced by each company are shared among operating companies. They are also
discussed at such meetings as the Board of Directors in an ongoing effort to promote the initiatives.
In recognition of its efforts to encourage the empowerment of women, JFE Holdings was selected three times as aNadeshiko Brand* since FY2013.
*The Nadeshiko Brand represents a joint initiative by the Ministry of Economy, Trade and Industry and the Tokyo Stock
Exchange. It recognizes exemplary efforts by companies to encourage women to play active roles and continue working
long-term. A single company is selected for each business sector represented in the TSE first section.

Company Policy Explained by the President
The president of JFE Holdings has endorsed the Declaration on Action that was introduced by a group of male leaders inJapan who intend to create “A Society in which Women Shine” with the support of the government’s Gender Equality
Bureau Cabinet Office. He also announced additional measures to support the professional development of female
personnel, thereby communicating both inside and outside the company that women can play active roles at JFE.
For more information, see:
Declaration on Action by a Group of Male Leaders Who Will Create a Society in Which Women Shine(https://www.gender.go.jp/policy/sokushin/male_leaders/pdf/declaration_body_en.pdf)

Employment of People with Disabilities
The JFE Group has three special subsidiaries, JFE Apple East Corporation, JFE Apple West Corporation and Mie Data
Craft Co., Ltd., to employ people with disabilities and create enjoyable workplace environments for them.
For more on the employment of people with disabilities, see:
Data on Employment of People with Disabilities (P.224)

Programs for Employees Over 60 Years Old
To ensure that the skills and experience of veteran employees are handed down, JFE Group companies have either raised
the mandatory retirement age to 65 or introduced a system that enables all employees to work until the age of 65.
As of April 2021, 701 elderly employees, about 3.5% of the total, are working at JFE Steel, JFE Engineering, andJFE Shoji.

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IndicesT JFE SteelJFE Steel raised its mandatory retirement age to 65 in April 2021 to ensure that veteran employees can remain highly
motivated in their work and pass on their techniques and skills. While we used to rehire anyone who wished to continue
working after reaching the age of 60, we recently established a personnel and wage system to cover all employees up
to the age of 65.

E

N JFE Engineering

JFE Engineering created the Skilled Partner Program to rehire employees who want to continue working after mandatory
retirement at age 60. The company is preparing to extend its mandatory retirement age to 65 by FY2023 to encourage
veteran employees to make an even greater contribution.

S

H JFE Shoji

JFE Shoji is mindful of creating an environment that allows veteran employees over 60 to continue working with highmotivation, while also seeking to realize flexible workstyles and develop a healthy working environment. Employees may
choose from a variety of working arrangements, including full-time employment, shortened workweeks, and shortened
daily work hours in accordance with their lifestyles.

Respect for Sexual Minorities (LGBTQ)The JFE Group is creating a workplace that does not discriminate on the basis of gender, sexual orientation or gender
identity by conducting internal human rights seminars and position-specific curriculums. LGBTQ concerns have also
been incorporated into the Group’s compliance guidebook, which is distributed to all employees and used as a common
textbook during the annual Compliance Month of October toward nurturing greater understanding. At JFE Engineering,e-learning programs are offered to all employees, and seminars are held mainly for personnel in human resources.

Securing Diverse Human Resources

Recruitment Results for University Graduates (FY2021) and Mid-career Recruits (FY2020)

670 people (three operating companies, excluding their subsidiaries)
Women in positions with prospects for promotion: 13% (40 out of 306)
Of the above, those in white-collar positions: 23% (20 out of 86)
Mid-career and year-round recruits: 16% (105 out of 670)
Of the above, recruits in positions with prospects for promotion: 23% (71 out of 306)
Of the above, recruits in on-site positions at steelworks: 9% (34 out of 364)

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To ensure sustainable growth, the JFE Group steadfastly recruits from a diverse pool of applicants and actively hires
women, foreign nationals and mid-career personnel, and recruits year-round.
The Group also operates overseas businesses across a broad range, and its overseas sites hire employees locally,
thereby contributing to communities with employment opportunities.

■ Recruitment Results (Three Operating Companies, Excluding their Subsidiaries) for University Graduates(FY2021) and Mid-career Recruits (FY2020)
Career-track Positions

On-site andClerical Positions

Category
White-collar

Technical

Total

Total

Male

66

200

266

332

598

Female

20

20

40

32

72

Total

86

220

306

364

670

23.3

9.1

13.1

8.8

10.7

Ratio of women (%)■ Target Ratios for Female Recruits
Position

JFE Steel

JFE Engineering

JFE Shoji

TargetCareer-track white-collar positions

At least 35%

Career-track technical positions

At least 10 %On-site positions for regular recruitment

At least 10%

Career-track white-collar positions

At least 35%

Career-track technical positions

At least 10%

Production/construction positions (technical)

At least 10% (4-year average)

Career-track positions for regular recruitment

At least 30%

For more on employees, refer to the following data.
Social Data (P.223)

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Human Resource Development
The JFE Group collectively carries out human resource development with an emphasis on nurturing the capacities ofeach employee and cultivating global human resources to support the expansion of our overseas business. We intend tocontinue making a Group-wide effort under the Seventh Medium-term Business Plan.

S

T JFE Steel

Utilizing Skill Data for Training Programs
The generational replacement of employees has peaked, raising the importance of boosting the skills of younger
employees. Accordingly, the company applies an evaluation system at manufacturing sites to quantitatively analyze theskill level of each employee and then uses the results in its training system. It also promotes the use of IT such as amixed reality technology-based training simulator for enhancing the quality of training.

E

N JFE Engineering

Engineering Training Programs to Support Independent Learning
To enhance the knowledge of underlying technologies that represent a technological foundation for an engineering
enterprise, the company’s leading expert lectures over 30 different courses on basic technology for younger employees
and mid-career hires.
A web-based learning curriculum launched in FY2018 offers employees opportunities to acquire business skills thatcater to each job responsibility, including accounting and marketing.
Through these training programs, JFE Engineering provides younger employees with opportunities to grow throughindependent and continuous learning and strengthens the leadership capabilities of managers to transform corporate
management.

S

H JFE Shoji

Training and Measures to Maximize Employee Potential
To expand the trading business in Japan and overseas, JFE Shoji organizes a training program that enables personnel withdiverse backgrounds to achieve growth in their respective work sites and business situations. The program includes acourse aimed at developing the basic skills required of trading company personnel, such as those for negotiation, financeand strategic thinking, and another course for newly hired mid-career employees. In addition, it also provides an overseas
trainee program that enables employees to experience business operations at overseas Group companies and invites
regional employees hired at overseas offices that require a high level of competency to Japan for training in order toincrease their skills and motivation. JFE Shoji intends to raise the level of competence across the entire Group throughthese programs targeting a broad range of employees.

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IndicesDeveloping Global Personnel
In addition to hiring and developing non-Japanese for career-track positions in Japan and local personnel overseas, theJFE Group is enhancing programs for Japanese employees to gain overseas study and training. The Company is also
developing younger employees through practical experience by dispatching them on overseas assignments.
■ Global Personnel Development Programs
JFE Steel

JFE Engineering

JFE Shoji

Study abroad

〇

〇

〇

Short-term overseas language training

〇

—

〇

Overseas assignments for younger employees

〇

〇

〇

Dispatching engineers to international conferences

〇

—

—

Training for local personnel at overseas sites

〇

〇

〇

Practical training in Japan for non-Japanese personnel
at overseas sites

—

〇

〇

Internship for international students

〇

〇

—

Developing Dynamic Working Environments
The JFE Group is developing dynamic working environments through sincere discussions with labor unions andconducting employee satisfaction surveys.
We also seek to reflect the results of the corporate ethics survey, conducted every three years, to create employeefriendly working environments.

S

T JFE Steel

Recognizing that labor-management cooperation is essential for the company to fully tackle its business challenges, JFE
Steel has established a strong relationship with its labor union based on understanding and trust. The company convenes
its Labor-Management Business Discussion Committee four times a year to bring the president and other executives
together with labor representatives for the purpose of exchanging ideas on business challenges. The two sides also
share views on working conditions and workplaces and hold joint consultations whenever the labor system is revised.

E

N JFE Engineering

JFE Engineering strives to ensure sound labor-management relations. In addition to Central Labor-management Committees,
which are regularly convened for the company’s president and other executives to share views with representatives of its
labor union, a labor-management committee on work-life-balance helps to maintain friendly working environments.
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H JFE Shoji

JFE Shoji management and labor have jointly declared they will achieve continuous growth for the company, enhancing
the lives of employees and realizing an affluent society based on mutual trust and understanding. The company maintains
a sound relationship between management and labor. Semiannual Management Committee meetings are held asopportunities for the company president and other executives to regularly exchange opinions and share management
information with representatives of the labor union.

Promoting Satisfying Work Environments
The JFE Group complies with laws and regulations related to salary payments and sets salaries above the minimum
wage designated by country, region and industry sector. In addition to meeting legal requirements on the upper limits
for overtime and other mandates, the Group establishes challenging and satisfying work environments by providing
employees with one of the top levels of employment conditions in the industry as well as performance-based bonuses
linked to company profits.
Furthermore, the Group offers generous welfare benefits, including dormitories and company housing in order toprovide a stable environment for our employees and encourage them to remain with the company for many years.

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Human Rights
The JFE Group endorses and abides by the Universal Declaration of Human Rights, the International Covenant on Human
Rights and other international conventions as well as the International Labour Organization’s Declaration on Fundamental
Principles and Rights at Work.
The JFE Group views respect for human rights as both a corporate social responsibility and a foundation of its
business. Our determination to not engage in discrimination in our business activities is clearly expressed in ourStandards of Business Conduct, which we have upheld throughout our actions. In FY2018, the JFE Group Human Rights
Basic Policy was established to further clarify the approach to our initiatives. While we require Group companies and theirofficers and employees to adhere to the policy, we also seek cooperation from all stakeholders including our supply chain
to respect and protect human rights.
In addition to organizing seminars by external experts on business and human rights, starting in FY2021 we havebeen conducting human rights due diligence in accordance with the United Nations Guiding Principles on Businessand Human Rights . We will continue to promote initiatives Group-wide for realizing a society in which human rights arerespected and protected.

Human Rights Basic Policy

1 Respect for basic human rights
We recognize the diverse values of individuals in all aspects of corporate activities and respect and defend all humanrights in accordance with international norms.
2 Abolition of discrimination
We respect each person as an individual in corporate activities and shall not discriminate in any way with regard torace, nationality, ethnicity, creed, religion, social status, family origin, age, gender, sexual orientation, gender identity,or presence or absence of any disability.
3 Prohibition of harassment
We shall not engage in harassment with respect to gender, position or in any other way, or by any behavior thatdemeans degrades the dignity of others or causes mental discomfort.
4 Respect for fundamental labor rights
We value healthy labor-management relations and work to solve problems through constant dialogue between
management and employees in good faith and in accordance with international norms, taking into account the laws
and labor practices of each country. In addition, we always strive to upgrade worker safety and work environmentsthat are rewarding for all employees.
5 Prohibition of child labor and forced labor
We shall not engage in any way in child labor or forced labor in any country or region.
6 Seek the cooperation to all stakeholders
Respecting and defending human rights is not only mandatory of all officers and employees of the JFE Group, we
also seek the cooperation of our supply chain members and all other stakeholders to observe these principles andpractices.

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Promoting Human Rights
In order to steadily work on human rights initiatives, we established the JFE Group Human Rights Promotion Council,
chaired by the corporate officer of JFE Holdings under the JFE Group Compliance Committee, chaired by the presidentof JFE Holdings. This framework allows us to define Group-wide policies and share information with departments
responsible for human rights issues that have been set up at each operating company.
In addressing all human rights risks, we emphasize communicating with stakeholders through such initiatives assetting up a Corporate Ethics Hotline at each operating company and dedicated consultation desks on harassment issues
at major offices, all of which accept anonymous reporting and consultation. Furthermore, we receive inquiries, including
anonymous requests, concerning compliance from external stakeholders via the contact form on our corporate website.
The operational status of these help desks and cases of harassment as well as other human rights violations are regularly
reported to the JFE Group CSR Council and Board of Directors, which provide direction and supervision.

■ Governance Structure for Human Rights Awareness Promotion
Board of Directors
Direction and supervision
Report regularly

JFE Group CSR Council Chairperson: president of JFE Holdings
Report on cases of harassment as well as other human rights violations
JFE Group Compliance Committee(chairperson: president of JFE Holdings)

JFE Group Human Rights Promotion Committee(chairperson: executive officer in charge ofGeneral Administration, JFE Holdings)

JFE Holdings
JFE Steel
JFE Engineering
JFE Shoji(departments responsible for human rights
management at each operating company)

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Human Rights Promoting Activities
We conduct human rights training courses, offer guaranteed employment opportunities, promote fair human-resource
management, and work to prevent workplace harassment. Our training courses encourage employees to develop athorough understanding of the JFE Group’s Human Rights Basic Policy and the respect for human rights expectedof a company in the international community. To this end, we continuously monitor and following up on seminars bydesignating 100% attendance as a KPI.
We seek to prevent sexual harassment, the abuse of power and other forms of harassment by addressing theseissues in company regulations, displaying posters in workplaces and organizing training for each position, individual
offices and executives. In FY2020, we invited an outside attorney to hold a seminar for about 200 hotline staff within the
JFE Group. We regularly organize such training sessions for hotline and consultation desk personnel.
Furthermore, we actively support and take part in initiatives undertaken by public organizations and groups promoting
human rights as well as groups in which private enterprises participate, such as the Industrial Federation for Human
Rights, Tokyo and the Corporate Federation for Dowa and Human Rights Issue, Osaka. By attending seminars andworkshops of such organizations and groups, we have become increasingly aware of human rights trends and challenges
as well as issues specific to Japanese business. In turn we apply this knowledge in JFE human-rights awareness training
programs and related initiatives.

Respecting the Rights of Workers
The JFE Group adheres to the laws and regulations of various countries as well as collective agreements. It also respects
the rights to freedom of association as well as their right to collective bargaining.
Upper management, including the president and the representative of the union, meets regularly to discuss matterssuch as management issues, work life-balance, working environments, and working conditions. By conducting earnest
labor-management consultations, we strive to create a vigorous workplace while working to maintain healthy and soundlabor-management relations.
The JFE Group complies with laws and regulations related to salary payments and sets salaries above the minimum
wage designated by country, region and industry sector. In addition to meeting legal requirements concerning the upper
limits for overtime and other mandates, the JFE Group establishes challenging and satisfying work environments byproviding our employees with one of the top levels of employment conditions in the industry as well as performancebased bonuses linked to company profits.
We regularly review the wage situation in each region and business sector and engage in honest discussions with thelabor union to ensure a fair return to our employees while also paying due consideration to management and businessperformance.

Respect for Freedom of Expression
The JFE Group upholds basic human rights in its Human Rights Basic Policy and is committed to respecting andprotecting the human rights of each individual throughout its corporate activities. We pay due care to prevent violationsof the freedom of expression, as recognized by the International Covenant on Human Rights and other international
conventions, and to fully protect the right to privacy.

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Respect for Children’s Rights
The JFE Group supports the Convention on the Rights of the Child and Children’s Rights and Business Principles and willseek to eliminate child labor and respect every child’s right to survival, right to development, right to protection and theright to participation, the four pillars of the Convention on the Rights of the Child.
The JFE Group Human Rights Basic Policy upholds recognizing the diverse values held by each individual in all
aspects of corporate activity as well as respecting and protecting the human rights of each person in compliance withinternational conventions. It also explicitly prohibits child labor and forced labor. To promote concrete initiatives, the JFEGroup has focused on nurturing the next generation as a key area of its public service and is engaged in activities that
support the sound development of younger generations.

S

T JFE SteelRespecting Human Rights across the Supply Chain
JFE Steel recognizes that human rights violations and environmental issues pose actual business risks in procuring raw
materials. It therefore established the Raw Material Purchasing Policy to develop and operate a sustainable procurement
system for sourcing raw materials and practice purchasing with due respect for human rights, regulatory compliance andenvironmental protection. JFE Steel also established Business Conduct Guidelines, asking suppliers to comply with thisinitiative, and seek to publicize the guidelines across the supply chain via its website.
Tantalum, tin, tungsten and gold produced in certain regions, such as the Democratic Republic of the Congo, aredefined as conflict minerals under the U.S. Wall Street Reform and Consumer Protection Act. There is concern thatsuch minerals provide a funding source for militias causing human rights violations and environmental destruction. In
our Business Conduct Guidelines, it is clearly stated that the company’s policy is to avoid purchasing conflict minerals.
Furthermore, JFE Steel complies with Japanese and overseas regulations governing the responsible procurement ofminerals as well as international rules and investigates and confirms with suppliers that they are not selling conflictminerals.
For more on the procurement of raw materials, refer to the following information.
Business Conduct Guidelines of the Raw Materials Purchasing Policy(https://www.jfe-steel.co.jp/en/company/purchase_policy.html)

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Human Rights Due Diligence
The JFE Group has adopted human rights due diligence based on the United Nations Guiding Principles on Businessand Human Rights. In FY2021, we conducted human rights due diligence centered on the Company and major Group
companies such as JFE Steel. We will continue to identify the JFE Group’s human rights risks, consider and implement
corrective measures, and consistently facilitate information disclosure and other relevant processes to ensure respect forhuman rights across the supply chain.

Human Rights Due Diligence Process
Starting in FY2021, the JFE Group has been implementing a human rights due diligence process to identify, assess, andmitigate any potential adverse human rights risks in the supply chain and disclose the information.

Board of Directors
Report on the status ofinitiatives on human rights risk

Direction and supervision

JFE Group CSR Council
Implement human rights due diligence①Identify target of management②Identify risks and determine
the current status of the system⑤Disclose to stakeholders
Disclosure

Evaluate risks
Human
RightsMitigation
measures

Identify
impacts④Formulate and implement
countermeasures and plans③Identify and determine impacts

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FY2021 Initiatives
Completed

Identify humanrights risks

Investigate
current status

Assess risks
and determine
impacts

Considermitigation
measuresTo be implemented

We examined various human rights risks related to the JFE Group’s supply chain byreferencing international rules and guidelines including the International Bill of Human
Rights and International Labour Organization (ILO)’s Declaration on Fundamental
Principles and Rights at Work and by confirming human rights risks associated with
the industry. As a result, we identified occupational health and safety, prohibition of
discrimination and human rights violations by suppliers as the JFE Group’s human rights
risks, among others.
We ascertained the current status of the risk management system and activities by
examining our disclosure of policies on child labor, forced labor and various other humanrights risks, such as the Raw Material Purchasing Policy, our whistleblowing system forensuring access to remedial action, our initiatives on compliance including preventionof corruption, and other initiatives, systems and rules concerning internal and external
human rights issues.
Having identified our human rights risks, we will assess these in relation to the degree ofseverity and probability of occurrence. We will also determine the status of our initiatives
on respecting human rights through written surveys and interviews in order to betterreflect that status in our future endeavors. During the risk assessment, we will determine
the adverse impacts of human rights risks on the JFE Group and its stakeholders.
We will consider measures and systems to mitigate, address, prevent and remedy key
risks with particularly significant adverse impacts.

Future Initiatives
We will establish a system for reducing human rights risks by continuously implementing measures for mitigating humanrights risks identified in FY2021 and disclosing information concerning our responses. We will also assess and improve
our initiatives to raise effectiveness under the supervision of the JFE Group CSR Council and Board of Directors.

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Community
JFE Standards of Business Conduct

3 Work with communities
Actively contribute to host communities as a good corporate citizen by emphasizing harmony and cooperation.

Local Activities
We are engaged in corporate activities across the globe. Continuing to do business requires that we forge relationshipsof trust with local communities and realize sustainable growth together by contributing to the development of eachregion in which we operate as well as by pursuing development at manufacturing sites where our steelworks arelocated. In addition to consistently taking action to ensure safety and reduce the environmental impact of our corporate
operations, we also conduct initiatives that serve the public with a focus on protecting the environment, nurturing thenext generation, promoting sports and culture, and revitalizing regional communities.
The operation of our steelworks involves massive production facilities and significantly impact the region’s
employment and economy as well as environmental air and water quality. Our steel business seeks to revitalize local
communities as an important means for deepening understanding of the JFE Group among local residents and mutuallypromoting regional development.
In addition, we provide paid leave programs that can be used to promote volunteer work to encourage the active
participation of employees.

Opening Manufacturing Sites to the Public
Every year, the JFE Group opens its manufacturing facilities to residents in local host communities for demonstrations,tours and other events.

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Indices■ On-site Events in FY2019**The list below shows results for FY2019 as the events in FY2020 were canceled to prevent the spread of COVID-19.
Location

JFE Steel

JFE Engineering

Event

East Japan Works,
KeihinKeihin Community Festival

East Japan Works,
Chiba

JFE Chiba Festival

West Japan Works,
Fukuyama

Date

Attendance

May 2646,000

October 27

30,000JFE West Japan Festival in
Fukuyama

May 1285,000West Japan Works,
Kurashiki

JFE West Japan Festival in
Kurashiki

November 3

80,000Chita Works

Handa Community Industrial
Festival

November 9

20,000Tsu Works

Autumn Festival 2019

October 19

4,000

JFE West Japan Festival in Fukuyama
In addition, on-site recreational facilities are made available for community sports such as soccer, baseball, volleyball andbasketball as well as other events sponsored by Group companies. Coaching sessions are offered by company baseballand track teams, which compete in Japan’s top-level corporate leagues. Such activities promote sports and health as well
as stronger relationships with host communities.

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IndicesT JFE SteelTour of Steelworks
Every year, JFE Steel invites over 100,000 guests*, mostly elementary and junior high school students from hostcommunities, to tour steel production sites at each steelwork, in conjunction with festivals and other events.
*In FY2020, we received visitors (about 30,000) after reducing the size of the tours and implementing adequate
measures for preventing the spread of COVID-19.

Education at Elementary Schools
JFE Steel conducts plant tours for students at nearby elementary schools. In addition, company employees visit schools
to give lectures on iron and steelmaking processes, the features of steelworks, environmental initiatives and other topics
to deepen understanding of the steel industry. These lectures have been given to over 233 classes since its start in
FY2012. In FY2017, the company conducted the first class at a school for hearing impaired children.

Visiting lecturer at Samugawa Elementary School in Chiba City

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Support for External Organizations
Contributing to the realization of a sustainable society is a key management concern for the JFE Group, which actively
seeks to address issues in collaboration with external groups and NGOs in pursuing solutions for the 17 SDGs.

UN World Food Programme
The JFE Group seeks to resolve the global hunger issue by supporting the cause and activities of the Japan Association
for the World Food Programme*.
*An NPO-accredited supporter of the UN World Food Programme (WFP), which works to eliminate hunger and poverty.

Supporting Training for Foreign Medical Professionals
The JFE Group supports the Japanese Council for Medical Training, spearheaded by the Toranomon Hospital in Tokyo.
The council offers a training program in which doctors from developing countries, primarily in Southeast Asia, are invited
to study in Japan. The program aims to make an international contribution by training participants in Japan’s advanced
medical practices so trainees can apply their results to raise the medical standards of their home countries and to foster
stronger relationships between those nations and Japan. The program also contributes to resolving health issues in local
communities by enhancing the medical standards of those countries.
Refer to the following for more information.
JCMT (http://www.jcmt.jp/english/)Japanese Foundation for Cancer Research
Since its establishment in 1908, the Japanese Foundation for Cancer Research has upheld its basic philosophy ofaiming to improve the well-being of people everywhere by achieving better cancer control. The JFE Group supports thisfoundation, which has played a leading role in research and treatment as well as human resource development in Japan.

Fund to Support Children’s Future
The JFE Group endorses the Japanese government’s national campaign for creating a society in which every child cangrow with dreams and hopes. The Group supports the Fund to Support Children’s Future, which provides assistance toNPOs and other groups engaged in activities to eliminate poverty throughout Japan.

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Support for Youth Development
Japanese Language Speech Contest
The JFE Group supports the All-China Japanese Speech Contest for university students in China as a way to promotestronger international exchange. The contest has been held since 2006 to further Japan-China relations through language
and communication, and JFE has provided support from its launch. Through this activity, the JFE Group contributes to thedevelopment of Japanese language education in China and the promotion of friendly exchanges between the two countries.

Contest to help build the friendship between Japan and
China (awards ceremony in FY2020)

Career Education for Students
JFE Steel and JFE Engineering provide plant tours for female junior high school, high school and university students toencourage them to pursue careers in science and technology.
Since 2006, JFE Steel has participated in the Keizai Koho Center’s “Business Training for Japanese School Teachers.”
Teachers from primary, junior high and high schools learn about business operations, human resource development,
safety and environment-protection-related initiatives, among other topics, with the intention of sharing that knowledge
with their students and leveraging it for better school management. In addition, some facilities invite local junior highstudents and host work-experience sessions.
As part of career education for high school and junior high school students, Kawasho Foods Corporation, a memberof the JFE Shoji group, cooperates with the School Support Center, a specified Nonprofit Corporation, to invite students
for training. The participants learn how society is supported by specific kinds of work as well as the products and services
related to such work.

Business training for schoolteachers
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FY2020 Internships
The JFE Group annually hosts many trainees and interns from overseas to help them gain practical experience at plants
as well as design and construction sites. They also participate in group work.
■ Number of Interns Accepted by Each Operating Company (FY2020)

S

JFE Steel

JFE Engineering

JFE Shoji

400(desk work: 262, technical: 138)586
(desk work: 96, technical: 490)

Approx. 585

T JFE SteelHigh School Science and Engineering Contest
The Japan Science & Engineering Challenge is a national science-paper contest for high school and technical college
students. Under the sponsorship of the Asahi Shimbun Company and TV Asahi Corporation, the contest has been
supported by JFE Steel since 2006 to nurture future scientists and engineers.

In FY2020, the contest was held online so as not to spread
COVID-19.

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H JFE Shoji

Supporting Elementary Schools in Ghana and Nigeria
Since 2011, the JFE Shoji Group has continuously supported elementary schools in the West African countries of Ghana
and Nigeria as part of its CSR activities. To address deficiencies in the local educational environment, it has also focusedon donating goods related to education and food, which are essential for the sound development of children and greatly
appreciated by the schools and governments in the countries. While the donation ceremony was canceled in FY2020 due
to the COVID-19 pandemic, the Group donated 17,000 notebooks, 12,500 cans of food, and 12,500 masks for children inan effort to prevent infection.
The JFE Shoji Group is committed to continuing this project into the future that symbolizes the Group’s commitment.

Students at an elementary school in Ghana

Supporting School Meals in Developing Countries
JFE Shoji participates in an activity led by TABLE FOR TWO International, a specified Nonprofit Organization, in which a
donation equivalent to one school meal for children in developing countries is made for every designated meal purchasedby employees in the company’s cafeteria.

Supporting Off-Campus Training by Special-Needs Schools
The JFE Shoji Group has been providing off-campus training opportunities for students at schools for special needs
since FY2017. Training mainly consists of gaining work experience by serving coffee and cleaning and learning about
distribution by introducing and selling sweets and coffee shop goods produced at their schools.

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JFE 21st Century Foundation
The JFE 21st Century Foundation was founded in 1990 through a donation from the JFE Group (the former Kawasaki
Steel) to operate as a public-service corporation that contributes to society. It engages in various public services, such assupporting research at universities and cultural development.
For more on the JFE 21st Century Foundation, refer to the following information.
JFE 21st Century Foundation (http://www.jfe-21st-cf.or.jp/eng/)
Data related to the JFE 21st Century Foundation (P.225)

Support for Technology Research
The foundation has been highly acclaimed by many universities for its support of technology research since FY1991.
In FY2020, it fielded 147 grant requests and provided a total of 44 million yen in the form of grants valued at 2 million
yen each for 9 projects involving iron and steel technologies and 13 projects related to environmental technologies,
including those designed to prevent global warming.

Support for Asian History Studies
The foundation began awarding grants in support of Asian history studies at Japanese universities in FY2005. In FY2020,59 applications were received and 8 grants worth 1.5 million yen each were awarded, bringing the total to 12 million yen.

Support Activities in Communities Hosting Steel Facilities
The foundation financially sponsors community cultural activities including music, art, traditional events, community
revitalization, community activities and the conservation of cultural property.
In FY2020, it sponsored seven events in regions across Japan where the Group operates its steel business, including
Chiba, Kawasaki and Fukuyama cities.

Supporting the Japan Overseas Educational Services Writing Contest and Anthology Donation
The Japan Overseas Educational Services organizes contests in the areas of essays, poems, tanka and haiku forJapanese students attending elementary and middle schools overseas. The JFE Group has been cosponsoring thecontest by offering JFE 21st Century Foundation prizes since FY1991. The foundation also donated 2,400 copies of“Chikyu ni Manabu” (Learn from the Earth), a collection of the winning entries again in FY2020, to 663 elementary andmiddle schools and 73 public libraries in the regions where the Group operates its steel business.

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List of Social-contribution Activities
Local Communities and Society

Nurturing the Next Generation

Supported World Food Programme
Supported Japanese Foundation for Cancer Research

Supported Chinese students’ Japanese speech
contestGave plant tours*

Supported Japanese Council for Medical Training
Supported Welfare and Medical Service Agency’sChildren’s Future Support Fund

(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-01)

Held festivals and events*

Supported technician education in Southeast Asia

(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-02)(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-01)

Donated to Japan National Council of Social Welfare

Organized internships(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-03)(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-02)

Lectured at elementary schools

Supported Japan Science & Engineering Challenge(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-04)(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-03)

Joined local cleanup activities*

Provided work experience(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-05)(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-04)

Conducted disaster response and prevention
activities with local governments

Supported career education(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-05)(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-06)

Accepted teachers for private-sector training

Implemented and promoted Active Exercise®

(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-06)(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-07)

Cooperated with School Support Center

Launched on-site daycare centers for local residents(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-08)(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-08)

Supported Females in choosing Science orEngineering careers

Cooperated with traditional events(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-09)(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-07)

Joined Nishinomiya tourism event

Certified as company supporting child rearing(Kanagawa Prefecture and Nagoya City)(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-10)

Held Manufacturing Class for children(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-11)

Certified as Work-Life Balance Business(Kanagawa Prefecture)

Sponsored children’s eco activities under World
Food Programme

Accepted foreign technical interns (welding
training)

Supported local festivals

Supported elementary schools in Ghana andNigeria

Organized public viewing of “Dragonfly Street”
and Station Square

Supported off-campus training by special-needs
schools

Joined Where Do Dragonflies Fly Forum
Supported Tsurumi Line stamp rally
Volunteered for Kasumigaura Marathon
Volunteered for disaster reconstruction
Organized in-house fairs for supporting postdisaster reconstruction (providing meals at acafeteria using ingredients from the disaster area)
Donated emergency food supplies to Food Bank Chiba
Participated in tree planting to invigorate a
rainforest in the Philippines**Postponed or canceled in FY2020 in response to the COVID-19 pandemic.
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Sports and Cultural Promotion

Organized firefly larvae release and viewing party

Held local sporting events(https://www.jfe-steel.co.jp/en/company/csr.html#anc04-01)(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-01)

Held environmental exhibitions

Baseball and racing clubs held instructional classes(https://www.jfe-steel.co.jp/en/company/csr.html#anc04-02)(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-02)

Volunteered to fertilized cherry trees

Sponsored Cho Chikun Go Cup(https://www.jfe-steel.co.jp/en/company/csr.html#anc04-03)(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-03)

Eco-purposed steel slag

Promoted parasports(https://www.jfe-steel.co.jp/en/company/csr.html#anc04-04)(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-04)

Obtained outstanding 3R-activities certificationfrom Yokohama City (9th straight year)

Keihin Symphonic Band gave performances(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-05)

Donated PET bottle caps
Cooperated with nonprofit Green Bird involunteer garbage collection

Contribution to Local Communities through the Engineering BusinessWe contribute to realizing a circular economy in local communities by combining businesses such as renewable energy
power generation, utility services, food recycling, and waste-to-energy power generation.
Development and Provision of Eco-friendly Processes and Products (P.94)

JFE 21st Century Foundation
The JFE 21st Century Foundation was established in 1990 with the support of JFE, including the former Kawasaki Steel.
As a public-interest foundation it undertakes various civic-minded services, including providing financial aid for university
research and promoting local culture.
JFE 21st Century Foundation (http://www.jfe-21st-cf.or.jp/eng/)
Issued technical research grants (steel-related technology, global environment, technology for preventing global warming)
Issued grants for Asian historical research
Created and donated textbooks for universities and publications related to steel
Sponsored cultural activities in communities hosting steel facilities
Held Overseas Literary Contest and donated literary works

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Shareholders and Investors
JFE Standards of Business Conduct (Excerpt)

2 Be open to society
Disclose corporate information actively and engage in constructive dialogues with diverse stakeholders to enhance
our corporate value.

Returns to Shareholders
The JFE Group positions returns on shareholder investment as one of its top priorities. Profits are basically returned in theform of dividends. The Group’s basic policy under its Seventh Medium-term Business Plan is to achieve a payout ratio of
about 30%.

Proactive Information Disclosure
The JFE Group strives for fair disclosure based on established internal policy. The Group actively communicates withinvestors by holding meetings when announcing financial results, medium-term business plans or other important
information. The executive directors explain the announced results and answers questions at investor meetings, andthey also hold small-group briefing sessions and conducts individual interviews with institutional investors and securities
analysts. In addition, they regularly visit investors in Japan and overseas, including institutional investors in North America
and Europe.
For individual investors, briefings are held at the branch offices of securities firms around Japan.
The Group also distributes e-mails regarding IR information. Important press releases and Notices of the Ordinary
General Meeting of Shareholders are provided in English for overseas investors.
In addition, JFE Holdings is committed to fair disclosure of information under its disclosure policy.
■ Major IR Activities (FY2020)
Activity

Participants

Investor meetings, ESG briefings

Approx. 600

Individual interviews with institutional investors and securities analysts

Approx. 300

Briefings for private investors

Approx. 1,500 in 4 briefings

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For more on this, please refer to the following information.
Disclosure policy (https://www.jfe-holdings.co.jp/en/investor/management/disclosure-policy/index.html)
Investor information: Japanese version (https://www.jfe-holdings.co.jp/investor)
Investor information: English version (https://www.jfe-holdings.co.jp/en/investor)

Enhancing Communication with Shareholders
JFE Holdings created its Investor Relations and Corporate Communications Department in April 2015 to facilitate moreinteractive communication with diverse stakeholders. The collection and dissemination of integrated information is beingenhanced to provide management with more useful information for constructive dialogues with shareholders, including
individual investors as well as domestic and foreign institutional investors.
General meetings of shareholders are opportunities for dialogue with shareholders, so JFE sends invitations at theearliest possible date to maximize attendance and avoid overlapping with the shareholder meetings of other companies.
The company has been posting an invitation on its website at the earliest possible date while allowing online voting forshareholders who are unable to attend.
For data related to plant tours and company briefing sessions for shareholders, please refer to the following information.
Major IR Activities (P.225)

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Corporate Governance
Basic Policy
With the steel business, engineering business and trading business at its core, the JFE Group develops a broad range ofbusinesses in a wide range of areas together with many group companies and partners. Establishing a proper governancesystem is essential toward improving independence and raising efficiency in each operating company, along with the
optimal management of risks, which include those related to the environment, safety, and disaster prevention in theGroup. It is also necessary for the sustainable growth of the Group and the medium-to long-term improvement of its
corporate value.
We have also established the JFE Holdings, Inc. Basic Policy on Corporate Governance to express concretely the JFEGroup’s Corporate Vision of pursuing best practices in corporate governance and achieving further development in thisarea.
JFE Holdings, Inc. Basic Policy on Corporate Governance (https://www.jfe-holdings.co.jp/en/company/info/pdf/basic-policy.pdf)
Corporate Governance Report (https://www.jfe-holdings.co.jp/en/company/info/pdf/corporate-governance.pdf)
Arrows indicate lines of authority and reporting
Shaded areas indicate executive organizations

General Meeting of Shareholders

JFE Holdings, Inc.
Nomination Committee

Board of Directors

Remuneration Committee(8 Directors, including 3 from outside)Group Management Strategy Committee
Management Committee

Internal Auditing

JFE Group CSR Council

CEO (President)

Corporate Officers

Accounting Auditor

Audit & Supervisory Board(5 Audit & Supervisory Board
Members, including 3 from outside)

Chair: CEO (President)

JFE Group Compliance
Committee

JFE Group Environmental
Committee

JFE Group Internal Control
Committee

JFE Group Information
Security Committee

Public Disclosure
Committee

Corporate Value
Enhancement Committee

Operating Companies
Board of Directors

Audit & Supervisory Board Members

Accounting Auditor

Management Committee

CEO (President)

CSR and Compliance System

Audit Department

Corporate Officers

Headed by the PresidentGroup Companies

Part of the governance data can be accessed from the following link.
Governance Data (P.226)

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Corporate Governance System
Group Governance System
The JFE Group comprises a holding company and three operating companies, JFE Steel, JFE Engineering, and JFE Shoji.
JFE Holdings, a pure holding company at the core of the Group’s integrated governance system, guides Group-wide
strategy, risk management, and public accountability.
Each operating company has developed its own system suited to its respective industry, ensuring the best course ofaction for competitiveness and profitability.
Corporate Governance System (P.226)
Major Topics Discussed at the FY2020 Board of Directors Meeting• Seventh Medium-Term Business Plan
• Large-scale capital expenditures (e.g., revamping of the No. 6 blast furnace at the East Japan Works (Chiba), expanding
electrical steel sheets production capacity of its West Japan Works (Kurashiki)• M&A projects (e.g., acquisition of Mitsui E&S Environment Engineering Corporation)• ESG initiatives (e.g., efforts to achieve carbon neutrality, assessment and review of KPIs for material CSR issues)

Governance System
JFE Holdings and each operating company have their respective Audit & Supervisory Board Members. The companies
are crosschecked by the Directors, who supervise operational execution, and the Audit & Supervisory Board members,
who conduct audits. Also, a Corporate Officer system separates decision-making and execution to clarify authority andresponsibility as well as to accelerate execution. JFE Holdings’ Board of Directors is responsible for maintaining andenhancing management efficiency and passing resolutions as legally required, laying down key management policies andstrategies and supervising operational execution. The Audit & Supervisory Board oversees management for the purposeof strengthening its soundness.

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Indices■ Major Initiatives to Strengthen the Governance
SystemSeptember
2002

June
2007

Established JFE Holdings

Added two Outside Directors and shortened the term of
Directors from two years to one year

October
2015

Established JFE Holdings, Inc. Basic Stance on
Corporate Governance, Nomination Committee, andRemuneration Committee

FY2015Initiated analysis and evaluation of board of directors’
effectiveness

June
2017

Reorganized the Board of Directors and the Audit &Supervisory Board based on results of theireffectiveness analysis and evaluation• Added the presidents of JFE Engineering and JFE Shoji tothe Board of Directors, along with an increase of two outside
members (Director and Audit & Supervisory Board Member)

Independent Outside Directors
Independent Outside Directors comprise one-third or more of the total number of Directors. Independent Outside
Directors will be elected from persons who are appropriate to bear the responsibility of strengthening governance suchas those who possess abundant experience as management in global enterprises or experts who possess profoundknowledge and satisfy our independence standards. Currently, of the eight Directors, three are Independent Outside
Directors.

Independent Outside Audit & Supervisory Board Members
More than half of the Audit & Supervisory Board Members are from outside. Independent Outside Audit & Supervisory
Board Members will be elected from persons who are appropriate to bear the role of enhancing the auditing function
such as those who possess abundant experience as management in global enterprises or experts who possess profoundknowledge and satisfy our independence standards. Currently, of the five Audit & Supervisory Board members, three are
Independent Outside Audit & Supervisory Board Members.
Standards for Independence of Outside Directors/Audit & Supervisory Board Members of JFE Holdings, Inc.
(https://www.jfe-holdings.co.jp/en/company/info/pdf/independence.pdf)

Directors and Audit & Supervisory Board Members (P.227)

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Approach to Diversity in the Board of Directors
With regard to the composition of the Board of Directors, the Company elects officers following deliberations by the
Nomination Committee by focusing on the enhancement of diversity of the Board members, such as their expertise,knowledge and experience in various fields, while balancing with the appropriate size of the Board. One female Audit& Supervisory Board Member was appointed in June 2019, and one female Director was appointed in June 2020. The
company is also working to enhance gender and global diversity mainly by electing Directors and Audit & Supervisory
Board Members who possess a wealth of knowledge and experience as management in global enterprises. The
company will continue to systematically engage in initiatives to foster such human resources suitable for candidates for
Directors and Audit & Supervisory Board Members by setting specific targets.

Nomination Committee and Remuneration Committee
In October 2015, JFE Holdings set up the Nomination Committee and the Remuneration Committee as advisory bodies
to the Board of Directors to secure fairness, objectivity, and transparency in the appointment of and remuneration for
Directors and Audit & Supervisory Board Members. For both committees, the majority of committee members are
Outside Directors/Audit & Supervisory Board Members and the chairs are chosen from among these people.
The Nomination Committee deliberates and reports to the Board of Directors on matters pertaining to the basic policyon the election and dismissal of the President of the Company, proposals for the election of candidates for the Presidentof the company, succession plans of the President of the Company, and the nomination of candidates for Outside
Directors and Outside Audit & Supervisory Board Members. Four meetings were held in FY2020, with 100% attendance
rates for all of them. The Remuneration Committee deliberates matters pertaining to the basic policy on the remunerationof directors, etc., of the Company and each operating company and reports to the Board of Directors. Five meetings were
held in FY2020, with 100% attendance rates for all of them.
Nomination Committee and Remuneration Committee (P.228)

Support for Directors and Audit & Supervisory Board Members
Directors and Audit & Supervisory Board Members are provided with opportunities and funding to receive training in legal
matters, corporate governance, risk management, and other subjects that help them fulfill their roles and duties.
In addition, a briefing is held for Outside Directors and Outside Audit & Supervisory Board Members prior to Board of
Directors meetings.
Furthermore, Outside Directors and Outside Audit & Supervisory Board Members are provided with relevant
information and opportunities to exchange opinions with the president and other top managers, attend key hearings on theoperational status of individual departments, and inspect business sites and Group companies inside and outside Japan.

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Analysis and Evaluation of the Board’s EffectivenessSince FY2015, JFE Holdings has been evaluating the overall effectiveness of its Board of Directors based on its Basic
Policy on Corporate Governance. Since FY2018, a third party has been conducting the analysis and evaluation to ensure
an objective viewpoint. In FY2020, questionnaires were sent to all Directors and Audit & Supervisory Board Members
after adding and revising their content based on the Practical Guidelines for Independent Directors.
Furthermore, we examined the results of our efforts in FY2020 to reflect the opinions and recommendations of the
FY2019 evaluation.
Based on the discussions by the Board of Directors in light of the survey results and evaluation by the thirdparty organization, it was determined that the overall effectiveness of the Board has been ensured through vigorous
discussions among members supported by sufficient preliminary briefings at the meeting for Outside Directors/Audit &Supervisory Board Members as well as by appropriate management and leadership by the chairperson.
FY2020 initiatives reflecting the results of the effectiveness evaluations up to the previous year include the following.
• Vigorous discussions regarding responses to the drastic changes in the business environment, including spread of
the COVID-19 pandemic and increased public expectation for companies to address climate change by implementing
emergency measures against the expansion of infection as well as formulating the Medium-Term Business Plan.
• Appointment of a female director who specializes in labor administration: her appointment further increased thediversity of Outside Officers in addition to those with management experience or with legal or business administration
expertise, thereby enhancing the richness of discussions at Board of Directors meetings.
• Enriched discussions on specific initiatives regarding sustainability issues, including reports on topics such as theresults of safety activities and employee awareness survey, status of the Corporate Ethics Hotline, and Group-wide
initiatives for achieving carbon neutral.
• Establishment of a Group governance system in April 2021, in which the JFE Group CSR Council chaired by the
President centrally carries out Group-wide risk management and reports critical matters to the Board of Directors for
direction and supervision. Going forward, we will continue to improve Group-wide risk management in accordance withdiscussions at Board of Directors meetings.
Furthermore, in addition to accurate and fair audits performed by the Audit & Supervisory Board Members, the members
also express opinions and actively ask questions at Board of Directors meetings on management decisions and reports
to further invigorate deliberations. Such outcomes supported the conclusion that JFE functions efficiently as a company
with an Audit & Supervisory Board.
Survey results identified issues relating to improving the effeciveness of the Board, such as strengthening thesupervising function of the Board of Directors in regard to responses to group risk management and sustainability issues
and providing more opportunities for Outside Officers to meet to exchange opinions with each other.
Following up on these points, we will continue to proactively implement initiatives to increase the effectiveness of theBoard of Directors and enhance the Group’s corporate value.

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Operating System
Key Decision-Making
JFE companies are responsible for business decisions in accordance with their respective rules and procedures, whereas
JFE Holdings makes decisions about Group-wide matters. Each operating company determines key matters through adeliberative process by its own Management Committee and Board of Directors. In April 2017, JFE Holdings changed
the operating structure of key committees. Management strategies involving the entire group are now deliberated by theGroup Management Strategy Committee and core issues of JFE holdings, the operating companies and the Group aredeliberated by the Management Committee before they are submitted to the Board of Directors for resolution.
Operating System (P.228)

Executive Remuneration
Executive remuneration is based on the Basic Policy on Remuneration for Directors and Corporate Officers and the
Policy for Deciding the Individual Remuneration for Directors and Corporate Officers founded on discussions and reportsby the Remuneration Committee, and it is decided through either a resolution of the Board of Directors or deliberations
by the Audit & Supervisory Board Members, for an amount within the total limit approved at the General Meeting of
Shareholders.

Basic Policy on Remuneration for Directors and Corporate Officers• The Board of Directors shall determine remuneration system for Directors and Corporate Officers based on
deliberations regarding its appropriateness by the Remuneration Committee to ensure fairness, objectiveness,and transparency.
• The remuneration level for Directors and Corporate Officers shall be determined to secure excellent humanresources who are able to put the Group’s corporate vision into practice, taking into consideration the businessenvironment of the Group and remuneration levels at other companies in the same industry or of the same scale.
• The ratio between basic remuneration and performance-linked remuneration (annual bonus and stock
remuneration) shall be properly established according to the roles and responsibilities, etc., of each Director andCorporate Officer so as to function as sound incentives toward the sustainable growth of the Group.

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Outline of Policy for Deciding the Individual Remuneration for Directors and Corporate Officers• Remuneration for Directors and Corporate Officers shall be determined by a resolution of the Board of Directors
in accordance with the Basic Policy and the Decision Policy, based on reports from the Remuneration Committee.
• Remuneration for the company’s Directors and Corporate Officers is comprised of basic remuneration andperformance-linked remuneration (annual bonus and stock remuneration).
• Basic remuneration is paid as a fixed amount, in cash, each month according to position.
• An annual bonus is linked to the company’s single-year performance and is paid in cash once a year.
• Stock remuneration is granted as the Company’s shares and cash equivalent to the amount of the Company’s
shares converted to market value through the trust upon retirement.
• The ratios of remuneration by type are structured so that the higher the position, the greater the weight ofperformance-linked remuneration, and the ratio for the company’s President when performance target goals havebeen attained is set so that the ratio of basic remuneration, annual bonus and stock remuneration stands at 6:2:2.

The company pays only basic remuneration to Outside Directors and Audit & Supervisory Board Members, given theirroles of supervising and auditing management from an independent and objective standpoint. Directors who concurrently
serve as Executive Directors of operating companies shall not be paid the Stock Remuneration from the company.
Performance-linked remuneration is calculated as follows.
• Annual bonus
Annual bonuses are calculated by taking the total segment profit for a single fiscal year as the performance-linked
indicator and multiplying the level of achievement of such indicator by a certain coefficient for each position.
• Stock remuneration
Under the stock remuneration plan, a payment level is determined based on performance targets set in the MediumTerm Business Plan of the Group. From FY2021 to FY2024, the payment level is determined according to the level ofachievement of the target profit attributable to owners of the parent company of 220 billion yen per year, set under theSeventh Medium-Term Business Plan. Furthermore, 5% or more return on equity attributable to owners of parent (ROE)
is the minimal requirement for the payment.
The Seventh Medium-Term Business Plan includes a provision for applying non-financial metrics in management targets.
In this regard, we will consider an optimal remuneration system that will further enhance corporate value.
■ Composition of Remuneration for the Company’s Directors andPart-time Audit & Supervisory Board Members

Stock remuneration
Basic remuneration

Annual bonus
Service Performance-length-linkedShort-term
performance-linked
Remuneration limit for the company’s Directors (all Directors):
within 700 million yen per year

Executive Remuneration (P.229)
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Medium- to long-term
performance-linked
Remuneration limit
for the company’s
Directors (excluding
Outside Directors):
within 800 million yen
over 4 years

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PolicyGuideline
IndicesInternal Control
The JFE Group’s internal control system, in accordance with the Basic Policy for Building an Internal Control System,
is maintained through various committee regulations including the Rules of the Board of Directors, Regulations forGroup Management Strategy Committee, Regulations for Management Committee, Regulations for the JFE GroupCSR Council, Regulations for Organization and Operations, Regulations for Document Management, Regulations for
Addressing Violence Directed at Companies, and the installation of Corporate Ethics Hotline. In April 2021, we revised
the Basic Policy and established the group governance system, in which the JEF Group Council chaired by the JFE
Holdings’ CEO (President), centrally carries out Group-wide risk management and reports critical matters to the Boardof Directors for direction and supervision to increase effectiveness of the Board of Directors and strengthen its auditing
function over risk management. The Basic Policy will be revised and improved from time to time to boost sustainablecorporate value.
Basic Policy for Building an Internal Control System (Japanese only)(https://www.jfe-holdings.co.jp/company/info/pdf/naibutousei.pdf)

Strengthening Internal Control
Internal Audits
JFE Holdings, its operating companies and key Group companies has internal audit organizations comprising 174 people
as of April 1, 2021. These organizations share information to enhance overall auditing within the Group.
Audits by Audit & Supervisory Board Members
Audit & Supervisory Board Members attend meetings of the Board of Directors, Group Management Strategy
Committee, and Management Committee as well as the Group CSR Council and other important meetings. To audit how
Directors execute their responsibilities, they conduct hearings with Directors and corporate officers regarding operational
status and receive operational reports from subsidiaries. In addition to undergoing statutory audits, JFE companies takethe following initiatives to strengthen coordination among the Members through information sharing and ensure theeffectiveness of internal auditing by the Audit & Supervisory Board Members.
A total of 34 full-time Audit & Supervisory Board Members have been appointed to 29 companies, including JFE
Holdings. Operating company personnel are dispatched to Group companies as part-time Outside Audit & Supervisory
Board Members. Each dispatched Audit & Supervisory Board Member serves one to five subsidiaries to perform audit
and enhance Group governance. Nine Audit & Supervisory Board Members served 28 companies in total.
The JFE Group Board of Auditors includes both full-time Audit & Supervisory Board Members of each Group company
and part-time Audit & Supervisory Board Members. Subcommittees and working groups created to address specificissues meet autonomously to share information, investigate issues and enhance understanding. The findings of theyear’s activities are presented at the general meeting of JFE Group Auditors and used for audits.
Operating System (P.228)

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Indices■ Structure of JFE Group Board of Auditors

General Meeting of
JFE Group Auditors(hosted by JFE Holdings and attended
by 43 auditors from 55 companies)

New Audit &Supervisory Board Member
training courses andother seminars

Subcommittees andworking groups(by topic)

JFE Steel andits group companies

JFE Engineering andits group companies

Part-time Audit &Supervisory Board Members

Part-time Audit &Supervisory Board Members(5 auditors overseeing
20 group companies)(4 auditors overseeing
8 group companies)

JFE Shoji andits group companies

Cooperation between Audit & Supervisory Board Members and Accounting Auditor
In FY2020, the Audit & Supervisory Board Members held seven scheduled or unscheduled meetings with Ernst & Young
ShinNihon, JFE’s outside accounting auditor, in which the latter presented its audit plan, completed work and detailed
results. The firm also presented a detailed explanation of its quality management system to confirm its validity. In turn,
the Audit & Supervisory Board Members explained their own audit plans and other matters to the firm. The two sides
also shared opinions on related matters.
Cooperation between Audit & Supervisory Board Members and Internal Auditing Department
In FY2020, the Audit & Supervisory Board Members held six scheduled or unscheduled meetings with the internal
auditing department, in which the latter presented its internal audit plan, work status and detailed results. During themeetings, the Audit & Supervisory Board Members also shared opinions with the department.

Operating Company GovernanceSome Directors, Corporate Officers and Audit & Supervisory Board Members of JFE Holdings serve concurrently as the
Directors or Audit & Supervisory Board Members of operating companies to strengthen governance and information
sharing across the Group. To strengthen governance, JFE Holdings’ managers attend each operating company’s
General Meeting of Shareholders and Management Planning Briefing, receive reports on their activities, and discuss the
managerial policies of subsidiaries.

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Policy on Listed Subsidiaries
To put into practice the Group’s corporate vision of contributing to society with the world’s most innovative technology,
and also to realize sustainable growth and enhancement of medium to long-term corporate value, the JFE Group forms
a corporate group comprising companies with high expertise, divides business functions within the Group and conducts
businesses development outside of the Group. Of these subsidiaries, the following three are the listed companies that
we hold.
GECOSS CORPORATION
The main business of GECOSS includes leasing and sales of temporary construction materials and designing andconstruction of temporary works. Its products and services are mainly provided to civil engineering and construction
businesses. GECOSS offers products and services that match the needs of its customers in cooperation with JFE Steeland the Group companies. We believe that carrying out business with GECOSS as our subsidiary will lead to maximizing
the value of the company and of the Group through personnel exchanges, R&D, and other collaborative initiatives
with JFE Steel. Furthermore, GECOSS maintains its listed status as a means to enhance its competitiveness from theperspective to secure market recognition and credibility in funding, sales and marketing, and hiring.
JFE Container Co., Ltd.
The main business of JFE Container includes manufacturing and sales of drum cans and high pressure gas containers. Its
products are mainly sold to chemical, oil, automobile, and gas businesses. JFE Container offers products that match theneeds of its customers in cooperation with JFE Steel and the Group companies. We believe that carrying out businesswith JFE Container as our subsidiary will contribute to maximizing the value of the company and of the Group throughpersonnel exchanges, R&D, and other collaborative initiatives with JFE Steel. Furthermore, JFE Container maintains its
listed status as a means to enhance its competitiveness from the perspective to secure market recognition and credibility
in funding, sales and marketing, and hiring.
JFE Systems, Inc.
The main business of JFE Sytems includes system integration consisting of planning, designing, development,
operation, and maintenance of information system, system construction utilizing solutions and the company’s own
products, and IT infrastructure solutions that support the business system. Computer systems are an important
foundation in the steel business that support overall business activities, including order acceptance, production,
shipment, and quality management, and in using a variety of data. Guaranteeing the accumulation of know-how and thecontinuation of personnel exchanges by holding JFE Systems as a subsidiary will also be indispensable for maintaing
the competitiveness of JFE Steel in pressing ahead with digital transformation. Furthermore, JFE Systems maintains its
listed status as a means to enhance its competitiveness from the perspective to secure market recognition and credibility
in funding, sales and marketing, and hiring.
The aforementioned three companies are subject to rules different from those applicable to other consolidated
subsidiaries, and other measures are also taken so as to ensure that each of the companies conducts autonomous
corporate activities exercising autonomy and flexibility, secure management independence as listed companies, andmake sure that the interest of the said subsidiaries’ shareholders other than the said subsidiaries and the Company
will not be unfairly impaired. In addition, with respect to matters necessary for the Group’s risk management, priorconsultation and reporting are required from the three companies while securing their independent decision-making, so
as to implement risk management as a member of the Group companies.
Furthermore, the Company shall regularly verify the significance of maintaining the listing of the listed subsidiaries
and take necessary measures upon confirmation at its Board of Directors. The above details were examined anddiscussed by the Board of Directors in May 2021.

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Basic Policies for Strategic Shareholdings and Exercise of Related Voting Rights
All shares held by the Company are the shares of subsidiaries or affiliates. In principle, the Company’s wholly owned
subsidiaries and operating companies, JFE Steel Corporation, JFE Engineering Corporation and JFE Shoji Corporation(hereinafter “Operating Companies”), do not hold domestic listed stocks as strategic shareholdings. Strategic
shareholdings, however, are allowed as an exception when holding the stocks of the Company is determined to benecessary for maintaining and achieving growth for the Group.
The Board of Directors meetings regularly confirm the significance of the strategic shareholdings and whether the
benefits and risks of such holdings are commensurate with their capital cost, and sell strategic shareholdings if there isno significance of such shareholdings or there is a risk of damage to shareholders’ interest. In April 2016, the Company
decided to reduce its strategic shareholdings by approximately 100 billion yen and sold its strategic shareholdings in theamount of approximately 140 billion yen (on a market value basis) by FY2018. In November 2019, the Company decided
on a policy to further sell its strategic shareholdings in the amount of 100 billion yen and sold all or part of 143 stocks
between FY2019 to FY 2020. (Total sales amount: approximately 145.9 billion yen (on a market value basis)).
Furthermore, the Board of Directors, at a meeting held in December 2020, examined the significance of its strategic
holdings and the return on investment. The exercise of voting rights of strategic shareholdings is decided upon reviewsby operating companies on the content of the proposal and is appropriately implemented in a way that will maximize
shareholder interest. To be specific, the content of the proposal is to be checked by the investment application
department and the investment control department, and approval will be given to proposals which are considered not
to pose any threat to the maximization of interest of these Operating Companies as shareholders. Of the shares forinvestment purposes held by JFE Steel, which has the largest balance sheet amount and account for the majority of theshares for investment purposes posted in the consolidated financial statements of the company, those shares of JFE
Steel that are held for purposes other than pure investments are shown below.
■ Number of Issues and Amount Reported in the Balance SheetFY2018 year-end

FY2019 year-end

FY2020 year-end

238

219

171

241.0

166.1

96.0

Number of issues
Total balance sheet amount (billion yen)

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IndicesCompliance
Basic Policy
In expanding our businesses in Japan and abroad, it is important that JFE maintains relationships of trust with all
stakeholders, including its customers, shareholders and local communities. Trust can only be built upon a strong
foundation of ensuring thorough compliance. Misconduct and scandals resulting from compliance violations can instantly
shatter the trust that has taken many years to establish. Therefore, JFE believes it is extremely important that all
members of the organization deepen their knowledge and awareness of compliance and perform their jobs accordingly.
It conducts training on various topics such as the Antimonopoly Act, the Subcontract Act and anti-corruption, including
prevention of bribery of public officials, using e-learning and compliance guidebooks and through guidebook reading
sessions as well as by other means.

Compliance System
The JFE Group Standards of Business Conduct guide employees to conduct their business activities based on the
Corporate Vision and Corporate Values. They also help to strengthen awareness among all JFE Group executives andemployees and ensure adherence to corporate ethics.
The Compliance Committee chaired by the President of JFE Holdings generally convenes every quarter to deliberatebasic policies and issues and then supervise their implementation. Each operating company has a similar in-housesystem for promoting and supervising compliance. In addition, operating companies have introduced a Corporate Ethics
Hotline to ensure that crucial information regarding compliance can be communicated directly from the front lines to top
management.
For more on the JFE Group Standards of Business Conduct, please refer to the following information.
JFE Group Standards of Business Conduct (https://www.jfe-holdings.co.jp/en/company/philosophy/guideline.html)

Ensure Adherence to Corporate Ethical Standards and Compliance
Thorough ComplianceAs part of its initiative to raise awareness of compliance, the JFE Group compiled a Compliance Guidebook that was
distributed to employees and executives (domestic and overseas) to be used in activities such as collation and to ensurethat the rules are fully communicated and informed. The guidebook provides a simple explanation of concrete standards
for complying with laws and internal rules and for acting in line with social mores with over a hundred case studies.
Questions that come up in the course of daily operations as well as situations and cases that test our judgment havebeen compiled in the guidebook with explanations by the relevant department. The content has been reviewed by legal
counsel.
The JFE Group also conducts training on compliance with the Antimonopoly Act, insider trading restrictions, security
export controls, the Construction Business Act, anticorruption laws including laws against bribery of public officials,
and more.

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Whistleblowing System
The JFE Group has established a Corporate Ethics Hotline, a contact point accessible to all officers and employees(including contract workers, part-time workers, and temporary staff, either active or retired) of the JFE Group as well as
those of suppliers and other business partners. The purpose of the hotline is to ensure adherence to corporate ethics
and compliance and to prevent corruption. Reports and consultations are accepted via e-mail, a dedicated phone line andpostal mail, anonymously if preferred, and an external hotline to an independent law firm is also provided.
To encourage the active sharing of information, the Corporate Ethics Hotline is operated under rules and regulations
that ensure strict confidentiality and protect people who report information or seek advice against acts of retaliation. We
investigate the facts of any reported incident only after consulting with the whistleblower to protect their privacy, andfeedback the investigation results to the whistleblower if requested.
We strive to prevent incidents of misconduct and ensure the early detection and correction of wrongdoing by
accepting consultations and reports, ranging from compliance issues such as violation of the Antimonopoly Act,
corruption, and bribery, to human rights abuses including misconduct and harassment in the workplace. In the eventthat violations of laws are confirmed, corrective and remedial measures are taken in the organization involved. Detailsof the reports and consultation received at the Corporate Ethics Hotline are regularly communicated to full-time Audit& Supervisory Board Members while the operational status of the system is reported to the Board of Directors for theirreview.
We also accept inquiries, anonymously if preferred, on compliance and other issues from outside stakeholders via aform on the corporate website. The content is handled as confidential and appropriately addressed.
Procedures for handling illegal acts or other violations:• Departments responsible for compliance at JFE Holdings and each operating company carry out necessary responses,
such as implementing the initial response, confirming facts, investigating the cause, and developing measures toprevent recurrence.
• Departments responsible for compliance at each company report on the facts, cause, and recurrence prevention
measures to the Compliance Committee at each company to confirm the cause and assess the effectiveness ofrecurrence prevention measures and the responsibility of related parties.
• Matters such as major violations are reported to the Compliance Committee to be shared across the entire Group andto facilitate horizontal implementation of recurrence prevention measures to make sure that no similar violations occur
anywhere in the Group.
■ Whistleblowing System
Those who raise or report concerns
Officers and employees of the JFE Group Officers and employeesof customers, suppliers, and other business partners* Including former officers and employees

Email / Telephone / Personally
written letter sent by ordinary mail

Reports

Requests aninvestigation

Board of Directors

Compliance Committee

Internal hotline

Reports aninvestigation

Reports aninvestigation
Requests aninvestigation

External hotline(at a law firm)* On a non-retainer basis

Responsible department /Relevant department(s)Reports the operational status of the system

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Feedback

Feedback

Concerns raised or reported(The nature of the concern and personal
information are kept strictly confidential.)

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IndicesPreventing Corruption and Bribery
Under its Standards of Business Conduct, the JFE Group endeavors to comply with laws and ordinances, compete
fairly and freely, refrain from illegal business activities, and build and maintain sound and proper relationships withgovernments and political authorities.
We explicitly prohibit bribery, such as the offering and receiving of illegal payoffs, excessive entertaining or favors, aswell as corruption such as embezzlement from a position of advantage and promotion of conflicting interests. The Group
strives to thoroughly prevent corruption by stating in its company rules that these offenses will be penalized.
In addition, under its Standards of Business Conduct, the JFE Group endeavors to build and maintain sound andproper relationships with governments and political authorities. The bribing of public officials has become a major
business risk in recent years due to growing global awareness of corruption and a stronger drive by authorities toexpose such wrongdoing. The JFE Group does not tolerate any kind of illegal activity in Japan or any other country,
including bribery, such as offering money or other benefits to public officials, and never resorts to these illegal activities
to gain profit or resolve problems. Considering this, the Group issued JFE Group’s Basic Policy on Preventing Bribery of
Public Officials and disseminate it throughout the Group including operating companies. The JFE Group also maintains
various systems to prevent the bribery of public officials, such as by stipulating that efforts be made to use third-party
appointment checklists or have an anti-bribery confirmation letter signed when using external parties including agents or
consultants who may have connections with overseas public officials.
For our stance on preventing bribery, refer to the following information.
JFE Group’s Basic Policy on Preventing Bribery of Public Officials(https://www.jfe-holdings.co.jp/en/company/philosophy/anti-bribery.html)

Resisting Organized Crime
The JFE Group declares in its standards of business conduct that it will firmly resist all antisocial forces and has
established the JFE Group Policies for Addressing Antisocial Forces and Regulations for Addressing Violence Directed at
Companies to clarify the measures to be taken against antisocial forces, including an initial response manual.
The JFE Group Policies for Addressing Antisocial Forces has been approved by the Board of Directors, and we willseek to establish sound corporate management based on an organized and unified response to the issue within theframework of our system of compliance. We have specifically set up a section responsible for handling antisocial forcesin the General Administration and Legal Affairs departments of each Group company to completely discontinue any
dealings with antisocial forces. We will also set up rules for reporting and responding to any related incidents and will
resolutely stand against antisocial forces by cooperating with law enforcement.
In addition, we will seek to establish thorough awareness of the JFE Group Policies for Addressing Antisocial Forces
and specific rules governing our response among all executives and employees by providing e-learning and distributing
the Compliance Guide Book.

Compliance with the Antimonopoly Act
The JFE Group views past violations of the Antimonopoly Act seriously and continues to implement thoroughmeasures to eliminate the possibility of future infringements. The internal audit departments of JFE Steel and JFE
Engineering are auditing transactions with other companies to ensure compliance with the Antimonopoly Act byconfirming that no activities are suspected of violating the law. The audits are being conducted regularly at each office,including branches and branch offices. Each Group company is implementing similar measures to prevent violations of
the Antimonopoly Act.
We are increasing the effectiveness of these recurrence prevention measures by regularly reporting relevant
activities to the Compliance Committee.
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Confirmation and Improvement through the Employee Awareness Survey
The JFE Group regularly conducts a Corporate Ethics Awareness Survey once every three years for directors andemployees of the Company as well as the operating companies to confirm the penetration and thorough complianceof the Group’s Corporate Vision, Corporate Values, and Standards of Business Conduct, along with the identification ofpotential risks. The survey conducted in FY2019 confirmed that many employees acknowledged the vision and corporate
policy and are aware of compliance matters when carrying out their work. On the other hand, the survey also brought toour attention issues to address going forward. Issues identified are reflected in the specific initiatives of each company
for improvement under the supervision of the JFE Group CSR Council and the Board of Directors.

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Risk Management
Risk Management System
JFE Holdings is responsible for comprehensive risk management of the Group in accordance with its Basic Stance for
Building an Internal Control System by establishing a system whereby the Board of Directors oversees risk management
and confirms its effectiveness.
In April 2021, we established a system whereby all risks in the Group are centrally managed by the Council and all
critical matters are reported to the Board of Directors for direction and supervision.
Specifically, corporate oficers are responsible for recognizing risks, and those deemed material are then confirmed
and assessed by the JFE Group CSR Council, chaired by the CEO (president) of JFE Holdings. Next, the CSR Council
deliberates and decides on countermeasure policy and action plans for risk management. Such risks include businessactivities; compliance-related matters such as compliance with the Antimonopoly Act and laws related to anti-corruption
including bribery of public officials, observance of company policy and regulations such as the Corporate Vision and JFEGroup Standards of Business Conduct; and ESG risks such as those related to the environment, climate change, humanaffairs, labor, safety and disaster prevention; human rights abuses such as sexual harassment and power harassment,
quality management, financial reporting, and information security. The Board of Directors oversees risk management
and confirms its effectiveness by regularly receiving reports on Group policy and action plans on risk management, andthrough deliberation and decision-making on important matters regarding risk mangement.
We will continue improving Group-wide risk management in accordance with the discussion by the Board of
Directors.
For our risk management policies and systems, refer to the following information.
Basic Policy for Building Internal Control Systems (Japanese only)(https://www.jfe-holdings.co.jp/company/info/pdf/naibutousei.pdf)

JFE Group CSR System (P.26)
Development of the Whistleblowing System (P.190)

Response to Specific Risks
Response to Climate Change Risks
The JFE Group places initiatives on climate change as top-priority business concerns, and it formulated the JFE Group
Environmental Vision for 2050 to achieve carbon neutrality by 2050. In the Seventh Medium-Term Business Plan, theGroup established managerial targets to reduce CO2 emissions from the steel business by 18% from FY2013 levels by
the end of FY2024 and achieve carbon neutrality by 2050.
Risks are identified and evaluated based on a scenario analysis conducted under the framework recommended by
the TCFD, and important factors that may affect management are selected for further analysis and used in formulating
business strategies, including the Seventh Medium-Term Business Plan.
For climate change risks and opportunities, refer to the following information.
TCFD Recommended Scenario Analysis (P.77)

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IndicesIntellectual Property Management
The JFE Group meticulously manages intellectual property across its diverse business activities. To prevent infringementon third-party intellectual property, it constantly monitors the latest information on intellectual property and implements
all necessary measures.

Privacy Protection
JFE has established the JFE Group Privacy Statement for managing information including “My Numbers,” which arepersonally identifiable numbers under Japan’s social security and tax number systems.
To maintain the appropriate protection of personal information, employee trainings on the rules, which have been set
in place in accordance with the privacy statement, have been conducted as stipulated in applicable laws of each country
related to businesses and guidelines.
To reduce information security risks, including cyber-attacks and improper system use such as leaks of personal
information, and to promote safe business activities, the JFE-Security Integration and Response Team (JFE-SIRT),
comprising the IT division managers of each operating company, participates in the Nippon CSIRT Association,
established by private sector volunteers and corporate Computer Security Incident Response Teams (CSIRTs) active inJapan. We seek to enhance the level of our initiatives by exchanging information and coordinating on security incidents.
For privacy protection policies, please refer to the following information.
JFE Group Privacy Statement (https://www.jfe-holdings.co.jp/en/privacy.html)

Information Security
The JFE Group formulates various rules on information security management to prevent information leakage and system
failures due to cyber-attacks and improper system use. Efforts are made to enhance information-security knowledge andawareness of rules among employees through training and education. Additionally, shared IT measures are applied ineach Group company and regular information security audits are conducted to reinforce the overall information security
management level in the Group.
Key issues related to IT, particularly information security, are deliberated by the JFE Group Information Security
Committee to determine Group policy.
Applying the policies set by the committee, the JFE-SIRT formulates and implements information-security measures,
performs information security audits, offers guidance on responding to incidents and generally enhances the levelof Group-wide information security management. JFE-SIRT reports on its activities to the Group CSR Council asappropriate.
For more details on JFE’s information security, refer to the information in the management section of the DX REPORT.
DX REPORT (https://www.jfe-holdings.co.jp/en/investor/library/dxreport/index.html)

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Indices■ Conceptual Diagram of Information Security

Board of Directors
Direction and supervision
Report on policy, activity plan, etc.
Group CSR Council

Chairperson: CEO (President)

Report and deliberate regularly (share risk information)
JFE Group Information Security Committee
Chairperson: General Manager of JFE Group
Information Security (Corporate Officer)
Decision

Planning and proposals
JFE-SIRT
Supervising and monitoring
ReportingExecution

Group companies

Responding to Human Rights Risks within the Supply Chain
The JFE Group procures raw materials, constuction materials, and machinery from all over the world. In reponse tohuman rights risks associated with the supply chain, the Group established the JFE Group Human Rights Basic Policy
in 2018 to take action in accordance with the United Nations Guiding Principles on Business and Human Rights. Each
operating company has established raw material purchasing policies, purchasing and procurement policies, and a basic
policy on sustainability in the supply chain, and they carry out purchasing in a way that respects human rights, legal
compliance, and environmental preservation.
In addition, starting in FY2021, the Group has been conducting human rights due diligence to support the creation ofsustainable supply chains.
For more details on our human rights due diligence initiatives, refer to Human Rights.
Human Rights (P.160)

JFE Group’s Business Continuity Plan
Anticipating the possibility of natural disasters caused by typhoons and major earthquakes as well as a rapid expansionof infectious diseases such as a new strain of influenza, the JFE Group has formulated a business continuity plan (BCP)
to address contingencies. We conduct regular training based on the BCP while also pursuing other countermeasures.
In the event of a major earthquake, the Group CSR Council will promptly discuss and determine the policy on how todeal with the matter, based on predetermined response processes to minimize loss and other damages.

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Response to Major Natural Disasters
We are preparing to respond in the event of a major earthquake through measures such as establishing tsunami shelters,
maintaining a Company-wide line of command under restricted communications and power outages, and securing data
backup. We have also strengthened drainage at our steelworks to address the impact of typhoons and torrential rains thatare occurring in Japan with increasing severity.

Response to the COVID-19 Pandemic
We have addressed the COVID-19 pandemic by quickly setting up a response team and implementing measures basedon the policies for an assumed outbreak of a new strain of influenza. We have sought to reduce commuting by relaxing
internal requirements to recommend various styles of working at home. For employees who must work at the office,we have adopted staggered commuting, installed office partitions and are using teleconferencing and other means to
reduce the risk of infection insofar as possible. Through these initiatives, we seek to explore more flexible workstyles andimprove the productivity of our workforce.
In particular, JFE Steel has reviewed its BCP for the novel influenza epidemic and conducted a simulation to gauge
the effects on operations in case an increase in the number of infections leads to a rise in the absence rate. The company
is preparing responses to diverse situations to maintain key businesses including operations at our steelworks while
improving its workplace environment by practicing thorough hygiene management and implementing a remote working
infrastructure. We are also actively promoting workplace COVID-19 vaccinations. We will continue to place top priority on
the safety and wellness of employees and others involved in the company.

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IndicesTax Transparency
Basic Policy
The JFE Group upholds the JFE Standards of Business Conduct and complies with both the letter and spirit of the
tax laws of each country as well as international rules, including the taxation guidelines issued by the Organization for
Economic Co-operation and Development and other international institutions. We will pay taxes in every country where
we do business in a timely, appropriate, and fair manner.
Moreover, we seek to forge relationships of trust with the tax authorities in each country by raising transparency andwithout resorting to tax planning or the use of tax havens to evade taxation.

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Environmental Data
Material Flow
JFE Steel works to reduce the environmental impact of its iron and steelmaking processes, including through theeffective use of resources. The company recycles 93.0% of the water it uses for production and uses 99.7% of its coproducts, such as iron and steelmaking slag. In addition, 100% of co-product gas generated during production is reused
as fuel for reheating slabs, generating power for internal use and supplying power to the public.

S

T JFE Steel (Non-consolidated)
SupplyEmissions

Input
Raw materials for steel
production

Industrial water

Purchased energy

215

110.1PJ

58.7 million tonnes•Petroleum-based fuels: 21.3 PJ•Electric power:
88.8 PJ•Iron ore: 35.4 million tonnes•Coal: 18.1 million tonnes•Lime:
5.2 million tonnes

milliontonnesRecycled materials•Steel scrap•Steel scrap (basic oxygen
milliontonnesfurnace, or BOF)

0.8

• Waste plastics• Waste PET bottles• Used consumer appliances• Food waste• Used batteries• Dust, sludge, etc.

JFE Group
Recycling Processes

CO2•Scope 1

tonnes CO
43.8 million

2

Total CO2 emissions fromenergy and non-energy sources•Scope 2
milliontonnes CO2

Coke oven and sintering plant

5.4

Coke oven gas

Flue gas•SOx

3.3 million Nm

3

Blast furnace•NOx

10.3 million Nm

3

BF gasWater recycled•Soot and dust
Greenhouse gases emitted
during transportation

93.0(domestic distribution)%

BOF and CC

2,851 million tonnes•CO2

0.34 million
tonnes CO

BOF gas2

Chemical substances (PRTR)•Released

1,694 tonnes

123
4.0 %

Evaporation loss

61.8

Recycled

Landfill%

Output7.0

Supplied tosociety38.2• Byproduct gas• Waste heat recovery
steam• Power generation byblast furnace (BF) top
gas-pressure recovery
turbine (TRT)

3.3 million tonnes

Rolling%%

Recovered energy
for recycling%

24.9 0.3

million tonnes

tonnes
92million
3.0 %Consumedby JFE Steel

0.037 million
tonnesReheat furnace

3,066•Transferred

Wastewater
milliontonnesLandfill

Total water
consumption

341 tonnes

Co-products

Shipments

tonnes
13.4 million•Slag: 10.8 million tonnes•Dust: 1.8 million tonnes•Sludge: 0.6 million tonnes•Other: 0.2 million tonnes

Effective use ofrecovered energy

100%

Effective use of
Co-products

99.7%

%

Supplied to Society

74.8

%

OutputEnergy supply

38.2%• Power• Fuel gas• Steam

Other products• Chemicals• Oxygen• Nitrogen• Hydrogen• ArgonSteel products
milliontonnes22.8(crude steel base)Community, Environment and Society

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Marine and land civilengineering materials

tonnes
10.0 million• Materials for cement• Roadbed materials• Port and harbor
construction materials• Fertilizer

Recycled products• NF Board®
• PET flakes• Palettes• Recycled resin

Message fromthe CEOE

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PolicyN JFE Engineering (Head Office and Works)

Input
Steel

JFE Engineering
36,900 tonnes

Energy• Tsurumi Works• Tsu Works•Electric power purchased 26.0 GWh•Class A heavy oil•Kerosene•Light oil•Gasoline•City gas
•LPG
Water

Output and Emissions
Products

34,700 tonnes

9,000 tonnes CO2
1,800 tonnes CO2•Scope 27,200 tonnes CO2
1,400 tonnes
Waste generated
1,100 tonnes•Industrial wastes
277 tonnes•General wastes
Wastewater (ocean only) 157,000 tonnes
CO2•Scope 1

84.4 kl
6.6 kl214 kl12.4 kl
330,000 tonnes
83.1 tonnes
72,400 tonnes

Others (PRTR)

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IndicesAbbreviations indicated under "scope" represent the following group or company:
JFE Group [All]; JFE Steel Group [ST Gr]; JFE Steel [ST]; JFE Engineering Group [EN Gr];JFE Engineering [EN]; JFE Shoji Group [SH Gr]; JFE Shoji [SH]

Environmental Management■ Data Regarding Environmental Management

Items

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

%

50

54

54

58

58

ST Gr

%

19

20

20

21

21

EN Gr

%

5

5

5

9

9

SH Gr

%

26

29

29

28

28

%

76

70

72

74

70

ST Gr

%

—

—

72

75

74

EN Gr

%

—

—

60

60

51

SH Gr

%

—

—

88

92

89

ST Gr

sites

34

31

31

32

24

EN Gr

sites

46

48

50

48

28

EN Gr

people

1,426

996

1,059

1,063

731

All
Base*1% covered by ISO
14001 certification

All
Employee*1

Environmental audit(number of sites)
Environmental education
conducted (total participants)*1 Data for past fiscal years were retroactively revised for increased accuracy.

■ Environmental Accounting Data (1)FY2019
Breakdown of environmental protection cost

Management
Global warming
countermeasures
Conservationof natural
resources

Environmental
protection

FY2020Investment(billion yen)

Cost(billion yen)

Investment(billion yen)

Cost(billion yen)

Impact monitoring and measurement,
and EMS expenses and education

0.1

2.6

1.4

2.6

Saving and efficiently using energy

26.7

27.6

14.4

25.2

Recycling industrial water

3.9

18.3

2.4

16.9

Recycling and waste management ofinternally generated materials, etc.

0.06

5.1

0.6

4.8

Air pollution countermeasures

11  

34.1

5.3

32.9

Water pollution countermeasures

4.1

11.3

4.7

10.6

Prevention of soil contamination, noise,
vibration, and subsidence

0.04

0.6

0

0.6

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Breakdown of environmental protection cost

Guideline
Indices

FY2020Investment(billion yen)

Cost(billion yen)

Investment(billion yen)

Cost(billion yen)

Other

Charges, etc.

—

1.5

—

1.6

R&D

Technologies for protecting theenvironment, saving energy, andpreventing global warming

1

11.3

0.8

8.3

Societal
activities

Support for nature preservation andforestation, information disclosure,exhibitions, and public relations

—

0.7

—

0.6

46.8

113.1

29.7

104.0

Total

Note: Data cover all investment activities of JFE Steel Corporation and R&D activities of JFE Engineering Corporation.

■ Environmental Accounting Data (2)
Items

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

Energy-saving investment(accumulated)Allbillion
yen

474.9

492.9

505.4

532.1

546.5

Environmental protection
investment (accumulated)Allbillion
yen

668.5

692.4

708.5

727.6

742.1

Environmental Management (Supplementary Data)■ List of ISO 14001 Certified Companies (includes certification limited to certain sites of a company)(As of July, 2021)
Operating company*1

JFE Steel Corporation

Group company
JFE MINERAL COMPANY, LTD.

JFE Plant Engineering Co., Ltd.*2

Mizushima Ferroalloy Co., Ltd.

JFE Techno-Research Corporation*2

JFE Material Co., Ltd.

JFE Metal Construction Inc.*2

JFE Plastic Resource Corporation

JFE KYOWA YOKI CO. LTD*2

JFE Bars & Shapes Corporation

Japan Pail Corporation*2

JFE Galvanizing & Coating Co., Ltd.

JFE SETOUCHI LOGISTICS CORPORATION*2

JFE Container Co., Ltd.

Guangzhou JFE Steel Sheet Co., Ltd.*3

JFE Welded Pipe Manufacturing Co., Ltd.

Thai Coated Steel Sheet Co., Ltd.

JFE Pipe Fitting Mfg. Co., Ltd.

Philippine Sinter Corporation

JFE LOGISTICS CORPORATIONJFE Steel Galvanizing（Thailand）

JFE Chemical Corp.

PT. JFE Steel Galvanizing Indonesia

DAIWA KOHTAI CO. LTD*2
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JFE Engineering
Corporation

JFE Shoji Corporation

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Group company
J&T Recycling Corporation

Fujikako, Inc.

JFE Aqua Machine and Service Corporation

Asuka Soken Co,. Ltd.

JFE Environmental Service Corporation

JFE Urban Recycle Corporation

JFE Shoji Coil Center Corporation

JFE Shoji MatechInc.*2

JFE Shoji Kohnan Steel Center Co., Ltd.

Kawasho Foods Corporation*2

Taisei Kogyo Corporation

K&I Tabular Corporation*2

Toyo Kinzoku Corporation

TohsenCorporation*2

Naigai Steel Corporation

Hoshi Kinzoku Corporation*2

NIHON JISEIZAI KOGYO CO., LTD.

Dongguan JFE Shoji Steel Products Co., Ltd.

Hokuriku Steel Co., Ltd.

Guangzhou JFE Shoji Steel Products Co., Ltd.

Mizushima Steel Corporation

Zhejiang JFE Shoji Steel Products Co., Ltd.

Mizushima Metal Products
Corporation

Jiangsu JFE Shoji Steel Products Co., Ltd.

JFE Shoji Electrical Steel Co., LTD.

JFE Shoji Steel Philippines, Inc.

JFE Shoji Usuitakenzai Corporation*2

Central Metals (Thailand) Ltd.

JFE Shoji Electronics Corporation*2

JFE Shoji Steel Vietnam Co., Ltd.

JFE Shoji Pipe & Fitting
Corporation*2

JFE Shoji Steel Hai Phong Co., Ltd.

JFE Shoji Service Corporation*2

JFE Shoji Steel Malaysia Sdn. Bhd.

JFE Shoji Machinery & Materials
Corporation*2

PT. JFE Shoji Steel Indonesia

JFE Shoji Steel Construction
Materials Corporation*2

JFE Shoji Steel de Mexico, S.A. de C.V.

JFE Shoji Terre One Corporation*2

JFE Shoji Steel India Private Limited

JFE Shoji Business Support, Inc.*2

Kawarin Enterprise Pte. Ltd.*2 *3*1 ISO 14001 certification is acquired at all manufacturing bases of JFE Steel and JFE Engineering and at all JFE Shoji's
business establishments in Japan.
*2 Excluded from the scope of ESG data collection.
*3 Equity-method affiliates.

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Climate Change■ CO2 Emissions by Scope

Items

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

million
t-CO2

61.8

62.2

59.9

60.4

53.2

ST Gr

million
t-CO2

61.7

62.1

59.7

60.0

52.6

ST*3

million
t-CO2

57.5

58.5

55.4

56.0

49.1

ST
subsidiaries

million
t-CO2

4.2

3.6

4.3

3.9

3.5

EN Gr

thousand
t-CO2

62.9

56.5

212

403

484

EN

thousand
t-CO2

16.6

17.3

17.5

16.8

14.1

EN
subsidiaries

thousand
t-CO2

46.3

39.3

195

386

470

SH Gr*4

thousand
t-CO2

31.7

35.7

36.2

35.3

29.6

SH

thousand
t-CO2

0.5

0.5

0.5

0.5

0.4

SH
thousandsubsidiaries*4
t-CO2

31.2

35.2

35.8

34.8

29.2

million
t-CO2

55.0

54.9

52.3

52.9

46.6

ST Gr

million
t-CO2

—

—

52.1

52.5

46.2

ST*3

million
t-CO2

52.6

52.5

49.2

49.8

43.8

ST
subsidiaries

million
t-CO2

—

—

3.0

2.7

2.4

EN Gr

thousand
t-CO2

—

—

171

361

442

EN

thousand
t-CO2

—

—

7.8

3.8

2.4

EN
subsidiaries

thousand
t-CO2

—

—

163

357

439

All

Scopes 1 and 2
total*1All

Scope1*5*6

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Scope

SocialGovernance

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Evaluations
and Awards

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PolicyGuideline
Indices

Unit

FY2016FY2017FY2018FY2019FY2020

million
t-CO2

6.7

7.4

7.6

7.6

6.5

ST Gr

million
t-CO2

—

—

7.5

7.5

6.4

ST*3

million
t-CO2

4.9

6.0

6.2

6.3

5.4

ST
subsidiaries

million
t-CO2

—

—

1.3

1.2

1.1

EN Gr

thousand
t-CO2

—

—

41.6

42.2

42.4

EN

thousand
t-CO2

—

—

9.7

12.9

11.6

EN
subsidiaries

thousand
t-CO2

—

—

31.9

29.3

30.8

SH Gr*4

thousand
t-CO2

31.7

35.7

36.2

35.3

29.6

SH

thousand
t-CO2

0.5

0.5

0.5

0.5

0.4

SH
thousandsubsidiaries*4
t-CO2

31.2

35.2

35.8

34.8

29.2

All

Scope2*

2

Unit CO2 emissions(numerator:
Scopes 1 and 2
total; denominator:
sales)*7

All

t-CO2/
billion yen

18,684

16,89815,463

16,193

16,470

Scope3*8*9All

thousandt-CO2e13,907

16,272

16,751

16,382

14,369Category 1
Purchased goods
and services

All

thousandt-CO2e11,01913,04813,371

12,557

11,026

Category 2
Capital goods

Allthousandt-CO2e

840

921

1,180

1,401

1,226

Category 3
Fuel and energy
related activities
not included in
Scopes 1 or 2

All

thousandt-CO2e

348

386

370

728

671

Category 4
Upstreamtransportationand deliveryAllthousandt-CO2e

647

650

491

489

419

Category 5
Waste generated
in operations

All

thousandt-CO2e

155

87

100

57

45

Category 6
Business travelAll

thousandt-CO2e

4

4

4

4

4

Category 7
EmployeecommutingAll

thousandt-CO2e

46

54

49

49

51

Category 15
InvestmentsAllthousandt-CO2e

848

1,122

1,186

1,097

927

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Indices*1 Data cover 76 companies- JFE Steel and 30 major domestic and overseas subsidiaries- JFE Engineering and 10 major domestic subsidiaries- JFE Shoji and 33 major domestic and overseas subsidiaries.
*2 CO2 Emission Factor for Purchased Electricity in FY2020:- JFE Steel uses the emission factor of the Commitment to a Low Carbon Society of the Japan Iron and SteelFederation for energy purchased in FY2019.
- JFE Steel’s domestic consolidated subsidiaries, the JFE Engineering Group, and the JFE Shoji Group apply the
adjusted emission factors of each electric power company for each fiscal year.
- Overseas: based on each country’s GHG protocol*3 Data in FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
*4 Data for past fiscal years were retroactively revised for increased accuracy.
*5 Data for JFE Steel include CO2 emissions from non-energy sources.
*6 S
 tarting with FY2018, data for JFE Steel’s subsidiaries and JFE Engineering’s subsidiary include CO2 emissions from
non-energy sources.
*7 The JFE Group changed its accounting standards from JGAAP to IFRS in FY2018.
*8 Coverage:(Categories 1, 2, 3, 4, 5)JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, and JFE Shoji	(Category 6, 7)JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, 10 JFE Engineering domestic
subsidiaries, and JFE Shoji(Category 15)Japan Marine United, and 9 JFE Steel equity-method affiliates (7 domestic and 2 overseas)*9 Sources: Green Value Chain Platform (Ministry of the Environment) and others■ Other Greenhouse Gas

Unit

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

ST*1

million
t-CO2

55.7

56.6

53.5

54.2

47.3

EN Gr*2

thousand
t-CO2

62.9

56.5

66.7

67.5

62.5

Scope1

ST*1

million
t-CO2

50.8

50.5

47.3

47.9

41.9

Unit: CO2 emissions(denominator:
crude steel
production)

ST*1

t-CO₂/
t-steel

1.94

1.99

2.03

2.03

2.08

ST Gr*3

million
t-CO2

—

—

2.61

2.65

2.40

ST

million
t-CO2

1.85

1.91

1.87

1.89

1.82

ST
subsidiaries

million
t-CO2

—

—

0.74

0.76

0.58

million
t-CO2

—

—

0.15

0.34

0.42

Items

CO2 emissions(Scopes 1 and 2 total)
CO2emissionsfromenergysources

CO2 emissions from non-energy
sources

Scope

J&T
Recycling
Co.*4

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Unit

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

All

thousandt-CO2e

93.7

94.8

88.7

103.3

96.1

All
(ST only)

thousandt-CO2e

73.4

76.2

72.2

72.9

68.3

All

thousandt-CO2e

20.3

18.6

16.5

30.4

27.9

ST

thousandt-CO2e

20.3

18.6

16.5

20.0

15.5

J&T
Recycling
Co.*4

thousandt-CO2e

—

—

—

10.4

12.4

ST Gr

million
t-CO2

0.65

0.65

0.66

0.65

0.57

ST

million
t-CO2

0.33

0.37

0.40

0.40

0.34

ST
subsidiaries

million
t-CO2

0.32

0.28

0.26

0.25

0.23

EN Gr

milliont-CO2/year

3.17

4.06

4.12

4.13

9.65

Biomass power
generation

EN Gr

milliont-CO2/year

1.30

1.97

2.12

2.12

2.74

Waste power
generation

EN Gr

milliont-CO2/year

1.61

1.64

1.53

1.53

3.37

Others (digestion gas,
geothermal, solar
power, wind, waste
heat recovery, fuelconversion, etc.)

EN Gr

milliont-CO2/year

0.26

0.46

0.47

0.48

3.54

Items

Methane (CH4)
GHG
emissionsother thanCO2
N2O

GHG emitted duringtransportation*5

Contribution to CO2 emission
reductions*⁶

Scope*1 Data in FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
*2 Data cover JFE Engineering and 10 consolidated subsidiaries in Japan.
*3 Data cover JFE Steel and 2 consolidated subsidiaries in Japan.
*4 J&T Recycling Co. is a domestic subsidiary of JFE Engneering.
*5 Data cover JFE Steel and 11 domestic and overseas subsidiaries, which are specified consigners designated under
the Japanese Energy Saving Act.
*6 Data cover only JFE Engineering’s domestic businesses up to FY2019, and from FY2020 the data cover JFE
Engineering’s domestic and overseas businesses and its German subsidiary Standardkessel Baumgarte GmbH (SBG).

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Indices■ Energy

Items

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

All

PJ

—

—

—

670

592

ST Gr

PJ

—

—

—

668.6

590.6

ST*1

PJ

640.9

644.0

613.3

619.8

545.3

ST
subsidiaries

PJ

—

ー

—

48.8

45.2

EN Gr

PJ

—

—

—

1.3

1.2

SH Gr

PJ

—

—

—

0.6

0.6

Energyconsumption

Energyconsumption
and unit
energyconsumption

Recoveredenergy forrecycling

Unit energy
consumption(crude steel
production)

ST*1

GJ/
t-steel

22.3

22.6

23.3

23.2

24.0

Energyconsumption(Crude petroleum
equivalent)ENkl

10,665

10,96010,886

8,788

8,000

YOY ratio of unit
energyconsumption

EN

%

92.9

97.4

95.4

80.7

91.0

Supplied tosociety

ST

%

35

37

39

39

38

Consumedinternally

ST

%

65

63

61

61

62

*1 Data from in FY2016 includes Sendai Works of JFE Bars & Shapes Corporation.

■ Modal Shift Rate

Items
All transportation
Transportation of a
distance of 500 km or
more

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

Ship and rail

ST

%

66.1

66.1

60.2

59.6

58.4

Truck

ST

%

33.9

33.9

39.8

40.4

41.6

Ship and rail

ST

%

94.7

92.7

91.6

90.9

91.6

Truck

ST

%

5.3

7.3

8.4

9.1

8.4

Scope of calculation: All products and half-finished products transported in JapanJFE GROUP CSR REPORT 2021

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Indices

Climate Change (Supplementary Data)■ CO2 Emissions and Energy Consumption of JFE Steel Group Subsidiaries (FY2020)

Company name

CO2 emissions (unit: t-CO2)

Energy consumption (unit: GJ)

JFE MINERAL COMPANY, LTD.

284,369

5,102,698

JFE Bars & Shapes Corporation

463,6138,855,335

Mizushima Ferroalloy Co., Ltd.

296,644

3,012,398

JFE Chemical Corp.

231,782

4,706,668

JFE LOGISTICS CORPORATION

156,6132,249,469

JFE Material Co., Ltd.

60,496

1,107,822

JFE Galvanizing & Coating Co., Ltd.

59,593

1,252,613

JFE ROCKFIBER CORPORATION

34,483

557,574

JFE Pipe Fitting Mfg. Co., Ltd.

15,246356,383

JFE Plastic Resource Corporation

20,853377,933

MIZUSHIMA RIVERMENT CORP.

11,464

161,650

JFE Container Co., Ltd.

10,206208,281

J-Logitec Co., Ltd.

8,240

120,150

Galvatex Corporation

4,504

88,212

JFE Metal Products & Engineering
Inc.

8,161

198,578

JFE Welded Pipe ManufacturingCo., Ltd.

7,870

156,619

JFE Techno-wire Corporation

4,992

110,067

JFE PRECISION CORPORATION

4,783

88,015K-PLASHEET CORPORATION

4,847

83,826

JFE LIFE CORPORATION

6,750

125,560

CHIBA RIVERMENT AND CEMENT
CORP.

6,779

132,610JFE KENZAI FENCE CO., LTD.

3,484

63,264

JFE Steel Pipe Co., Ltd.

3,043

64,927

GECOSS CORPORATION

2,985

61,455

JFE Kozai Corporation

2,855

62,5505 overseas companies

1,207,692

15,925,097

Total

2,918,390

45,229,754

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Indices■ CO2 Emissions from Energy Sources and Energy Consumption of JFE Engineering Group Subsidiaries (FY2020)

Company name

CO2 emissions (unit: t-CO2)

Energy consumption (unit: GJ)

J&T Recycling Corporation

39,686770,206

J Farm Corporation

3,023

56,707

Fujikako, Inc.

1,606

36,102NORTHERN JAPAN MACHINERY Corporation

1,012

16,860

Tohoku Dock Ironworks Corporation

940

17,246

JFE Environmental Service Corporation730

12,197

Asuka Soken Co,. Ltd.

891

15,362

JFE Pipeline Engineering Corporation

362

5,939

JFE Technos Corporation

183

3,075

JFE Aqua Machine and Service Corporation

21

656

48,454

934,349

Total

Prevention of Pollution■ Air Emissions

Items

SOx emissions*1

NOx
emissions*1

Scope

Unit

FY2016FY2017FY2018FY2019FY2020ST Gr

million Nm3

4.5

4.7

4.1

4.3

3.3

ST

million Nm3

4.5

4.6

4.1

4.3

3.3

ST
subsidiaries

million Nm3

0.03

0.05

0.04

0.04

0.03

ST Gr

million Nm3

11.1

11.7

10.7

11.3

10.4

ST

million Nm3

10.9

11.5

10.5

11.1

10.3

ST
subsidiaries

million Nm3

0.22

0.20

0.19

0.17

0.14

*1 13 JFE Steel consolidated subsidiaries in Japan.

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SocialGovernanceUnit

FY2016FY2017FY2018FY2019FY2020

ST

t/day

3.1

3.0

3.3

3.2

2.9

ST
subsidiaries*1

t/day

0.13

0.14

0.17

0.15

0.17

EN*2

kg/day

6.1

5.6

6.8

8.4

8.7

FY2016FY2017FY2018FY2019FY2020■ Release to Waterways

Items

Scope

COD (chemical
oxygen demand)*1 15 JFE Steel consolidated subsidiaries in Japan.
*2 This report uses the maximum value of each year.

■ Chemical Substances Management

Items

Scope

Amountreleased

PRTR-registeredsubstances*1*2

Amounttransferred

Unit

All*3

t

—

—

1,019

918

754

ST Gr

t

842

897

814

766

596

ST

t

429

516

545

481

341

ST
subsidiaries

t

413

381

269

285

255

EN Gr

t

—

—

205

152

158

EN

t

87

85

147

107

121

EN
subsidiaries

t

—

—

58.4

45.4

36.7

All*3

t

—

—

9,210

7,866

5,949

ST Gr

t

7,047

8,934

9,176

7,832

5,910

ST

t

2,212

2,726

2,533

1,865

1,694

ST
subsidiaries

t

4,835

6,208

6,643

5,967

4,216

EN Gr

t

—

—

34

34

39

EN

t

28

28

28

29

26

EN
subsidiaries

t

—

—

5.7

5.4

12.5

*1 Coverage:- JFE Steel and 18 consolidated subsidiaries in Japan.
- JFE Engneeringand 4 consolidated subsidiaries in Japan.
*2 Excluding dioxins*3 JFE Shoji is not included in the scope of the report as the company is not subject to PRTR registration.

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IndicesPrevention of Pollution (Supplementary Data)■ SOx and NOx Emissions of JFE Steel Group Subsidiaries (FY2020)

Company name

SOx emissions(unit: Nm3)

JFE MINERAL COMPANY, LTD.

NOx emissions(unit: Nm3)

4,258

35,642

JFE ROCKFIBER CORPORATION

00

Mizushima Ferroalloy Co., Ltd.

221

21,523

4,964

24,242

113

953

MIZUSHIMA RIVERMENT CORP.

0625

JFE PRECISION CORPORATION

2,197

126

JFE Plastic Resource Corporation

144

284

JFE Bars & Shapes Corporation

3,397

8,985

JFE Metal Products & Engineering Inc.

53

1,364

JFE KENZAI FENCE CO., LTD.

0

0

1,756

11,186108

0

JFE Welded Pipe Manufacturing Co., Ltd.

00

JFE Steel Pipe Co., Ltd.

00

Galvatex Corporation

0449

JFE Pipe Fitting Mfg. Co., Ltd.

22

759

JFE Techno-wire Corporation

00

JFE Kozai Corporation

0

0

GECOSS CORPORATION

00JFE LOGISTICS CORPORATION

00

J-Logitec Co., Ltd.

00

JFE Chemical Corp.

8,811

35,949

163

0

0

0

26,207142,087

JFE Material Co., Ltd.
CHIBA RIVERMENT AND CEMENT CORP.

JFE Galvanizing & Coating Co., Ltd.
JFE Container Co., Ltd.

K-PLASHEET CORPORATIONJFE LIFE CORPORATION
Total

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Efficient Use of Natural Resources■ Natural Resources

Items

Scope

Raw materials forsteel production

ST

Iron ore

FY2016FY2017FY2018FY2019FY2020

million tonnes

70.1

71.3

66.0

67.0

58.7

ST

million tonnes

43.5

43.5

40.1

41.4

35.4

Coal

ST

million tonnes

21.0

22.0

20.6

20.3

18.1

Lime

ST

million tonnes

5.6

5.8

5.3

5.3

5.2

Recycled materials(steel scrap)STmillion tonnes

0.7

1.2

1.3

1.1

0.8

Raw materials

EN

thousand tonnes

39.1

41.8

47.3

39.4

36.9

Steel products

ST*1

million tonnes

28.8

28.5

26.3

26.7

22.8

Engineering
products

EN

thousand tonnes

36.1

39.7

44.5

36.6

34.7

Input

Products
suppliedUnit*1 Data in FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.

■ Co-products and Wastes

Items

Unit

FY2016FY2017FY2018FY2019FY2020ST Gr

milliontonnes

15.3

16.2

16.1

15.6

13.9

ST

milliontonnes

14.5

15.7

15.3

15.1

13.4

ST
subsidiaries

milliontonnes

0.8

0.5

0.8

0.5

0.5

Amountrecycled
internallySTmilliontonnes

3.7

4.2

6.0

5.0

3.3

Internal
recycle rate

ST

%

25.4

27.5

39.3

32.9

24.9

ST Gr

milliontonnes

0.087

0.081

0.081

0.074

0.060

ST

milliontonnes

0.045

0.047

0.052

0.043

0.037

ST
subsidiaries

milliontonnes

0.042

0.034

0.029

0.031

0.023

%

99.7

99.7

99.7

99.7

99.7

Amountgenerated*1

Co-products

Landfillamount*1

Recycling rate

Scope

ST

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Items

Marine, land,and civil
engineering
material (using
co-products)

SocialScope

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Governance

ESG Data

Unit

FY2016FY2017FY2018FY2019FY2020Co-products
generatedST

milliontonnes

14.5

15.4

15.3

15.1

13.4

Used by local
communities

ST

milliontonnes

10.8

11.2

9.2

10.1

10.0

Rate of local
communities
use

ST

%

74.3

72.2

60.4

66.8

74.8

Amountgenerated*2*3

EN Gr

thousandtonnes

—

158.0

131.7

211.0

159.1

EN

t

320.8

429.8

386.4

367.1

329.2

Yokohama
HO

t

241.7

357.1

299.9

299.0

256.9

Tsu works

t

79.1

72.7

86.5

68.2

72.3

EN

t

973.2

773.0

1,039.3

1,340.5

1,072.3

Tsurumi
works

t

443.4

302.3

506.6

653.8

519.8

Tsu works

t

529.8

470.7

532.7

686.7

552.5

ConstructionsENt

101,812.2

88,140.4

109,045.2

145,397.7

97,387.9

Subsidiaries

EN
subsidiariest—

69,835.7

22,634.4

63,876.7

60,296.7

LandfillENt

1,954.4

1,666.5

2,125.1

4,489.3

2,011.6

EN

t

8.4

9.0

10.7

8.5

9.1

Yokohama
HO

t

3.3

4.3

4.1

3.3

2.1

Tsuworks

t

5.1

4.7

6.6

5.2

7.0

EN

t

329.8

289.0

353.3

312.6

351.2

Tsurumi
works

t

67.0

70.6

83.2

77.3

75.2

Tsuworks

t

262.8

218.4

270.1

235.3

276.0

ConstructionsENt

1,616.2

1,368.5

1,761.1

4,168.2

1,651.3

Recycling rate

EN

%

96.3

96.7

97.0

95.8

95.9

EN

%

96.9

97.6

96.7

97.3

96.8

Yokohama
HO

%

98.5

98.7

98.5

98.8

99.1

Tsuworks

%

88.9

89.0

85.2

85.2

87.2

%

53.4

45.3

46.8

68.0

48.8

Tsurumi
works

%

78.9

61.0

68.7

79.4

72.0

Tsuworks

%

32.5

37.0

32.1

60.9

33.8

%

98.4

98.4

98.4

97.1

98.3

Offices

Productions

OfficesWastes

Productions

Recycling rate
(offices)

EN
Recycling rate
(production)

Recycling rate(construction)EN*1 Data cover JFE Steel and 25 consolidated subsidiaries in Japan.
*2 Data cover JFE Engineering and 10 consolidated subsidiaries in Japan.
*3 Data from FY2019 includes wastes generated at offices and productions of JFE Engneering.
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Indices■ Wastes at JFE Engineering Construction Sites

Items

RubbleSludgeIndustrial waste
excluding rubble
and sludge

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

Amount generated

ENt56,767

58,82478,410113,637

78,100Landfill amount

EN

t

414

94

297

1,533

484

Recycle rate

EN

%

99.3

99.8

99.6

98.6

99.4

Amount generated

ENt

21,814

23,463

16,142

17,225

12,399Landfill amount

EN

t

98

849

199

205

135

Recycle rate

EN

%

99.5

96.3

98.8

98.8

98.9

Amount generated

ENt23,231

5,853

14,494

14,535

6,888

Landfill amount

EN

t

1,103

425

1,265

2,430

1,032

Recycle rate

EN

%

95.0

92.2

91.0

82.1

83.4

Scope

Unit

FY2016FY2017FY2018FY2019FY2020

SH

boxes

4,904

5,100

4,832

4,675

3,116

Tokyo

boxes

2,614

2,674

2,661

2,516

1,333

Osaka

boxes

545

527

372

399

405

Nagoya

boxes

305

308

217

293

157

Branch

boxes

1,440

1,591

1,582

1,467

1,221

■ Paper Consumption at JFE Shoji
Items

Consumption of copier papers

Efficient Use of Natural Resources (Supplementary Data)■ Examples of Recycling and Processing at JFE Group (FY2020)
Content

Unit

Volumemilliontonnes

0.09

Used directly in the iron and steelmaking process

milliontonnes0.05

Collected as gas and used as fuelmilliontonnes0.05

Treating fluorescent tubes

milliontubes

20

Waste home appliances

million
units

0.50

Plastic containers and packaging bidding

Using waste plastics in the iron andsteelmaking process

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Editorial
Policy■ List of JFE Group's Recycling Businesses

Area

Name of company, plant,
business establishment, etc.

SapporoSapporo Bio Food Recycle
Corporation

SendaiJ&T Recycling Corporation
Sendai Plant

Rifu Plant

Plant

Addresses

Food waste recycling plant45-53 Nakanuma-cho, Higashi-ku
Sapporo-shi, Hokkaido

Sendai plastic packaging-wastesorting and baling plant
Plastic material recycling plant
Fluorescent tube recycling plant
Recycled pallet manufacturing plant
Confidential documents disposal plant
Refuse paper and plastic (RPF)
manufacturing plant

1-6-1 Minato, Miyagino-ku Sendaishi,
Miyagisame as above
same as above
same as above
same as above
6-5-14 Shirakashidai, Rifu-cho Miyagigun, Miyagi

Electric furnace recycle plant
Direct current arc furnace

7 Minamihama, Kamisu-shi, Ibaraki

Kashima

JFE Bars & Shapes Corporation

Chiba

J&T Recycling Corporation
Chiba Recycle Center

Waste gasifying and melting furnace

Chiba Biogas Center

Food waste recycling plant

1 Kawasaki-cho, Chuo-ku Chibashi,
Chibasame as above

Fluidized bed gasification and melting
furnace (industrial)
Vertical furnace (medical)

Oumi 3-chome chisaki, Koto-ku,
Tokyosame as above

Waste plastic recycling plant

10 Ohgishima, Kawasaki-ku
Kawasaki-shi, Kanagawa
5-1 Mizue-cho, Kawasaki-shi
Kawasaki-ku, Kanagawa
5-73 Ohgimachi, Kawasaki-ku
Kawasaki-shi, Kanagawa (and otherlocations)same as above

Tokyo

J&T Recycling Corporation
Tokyo Waterfront Eco Clean

Kawasaki

J&T Recycling Corporation
Ohgishima Plant
Kawasaki PET Bottle Recycling
Plant
Kawasaki Eco Clean

Waste PET bottle recycling plant
Kiln-stoker incinerator
Solid waste recycling plant

Yokohama

JFE Plastic Resource Corporation
Mizue Recycling Plant

Waste plastic recycling plant

NF Board® manufacturing plant

NF Board® manufacturing plant

JFE Urban Recycle Corporation
Home Appliance Recycling
plant

Consumer/office appliance recyclingplant

6-1 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa

J&T Recycling Corporation
Yokohama Eco Clean

Kiln-stoker incinerator

2-1-5 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa (and otherlocations)same as above
3-1 Benten-cho,Tsurumi-ku
Yokohama-shi, Kanagawa
2-1-8 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa
same as above

Recycling Plant

Kiln-ash melting furnace
Liquid/sludge waste intermediatetreatment plant
Dry cell battery and battery recycling
plant
Fluorescent tube recycling plant

Yokohama Plastics Recycling
Plant
Kanazawa Recycling Plant

Yokohama City plastic packagingwaste sorting and baling plant
Solid waste recycling plant

Chemical Works
Tsurumi Fluorescent Tube

JFE GROUP CSR REPORT 2021

215

699-23 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa (and otherlocations)
5-1 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa

same as above
1-14-5 Fukuura, Kanazawa-ku
Yokohama-shi, Kanagawa

Guideline
IndicesMessage fromthe CEO

JFE Group
VisionArea

CSRManagement

Environment

SocialGovernanceName of company, plant,
business establishment, etc.

ESG Data

Plant

External
Evaluations
and Awards

Editorial
PolicyAddresses

Yokohama

J Bio Food Recycle Co., Ltd.
Yokohama Plant

Food waste recycling plant

2-1-5 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa

Kurashiki(Mizushima)

Mizushima Eco-works Co., Ltd.

Waste gasifying and melting furnace

1-14-5 Kawasaki-dori, Mizushima,
Kurashiki-shi, Okayama

JFE Environmental Service
Corporation
Kurashiki Works

Waste wood carbonizing facility

1-14-1 Kawasaki-dori, Mizushima,
Kurashiki-shi, Okayama

JFE Bars & Shapes Corporation

Fukuyama

ToyamaElectric furnace recycling plant
Direct current arc furnace

1-5-2 Kawasaki-dori, Mizushima,
Kurashiki-shi, Okayama (and otherlocations)

JFE Plastic Resource Corporation
Fukuyama Recycling Plant

Waste plastic recycling plant

113 Minoki-cho, Fukuyamashi,
Hiroshima

J&T Recycling Corporation
Fukuyama RPF Plant

RPF manufacturing plant

Fukuyama PM Recycling Plant
Fukuyama Palette Plant
Steel Works

Plastic material recycling plant
Recycled pallet manufacturing plant
Kiln incinerator
Controlled landfill
Liquid waste neutralization plant

115-1 Minoki-cho, Fukuyamashi,
Hiroshima
same as above
same as above
1 Kokan-cho, Fukuyama-shi,
Hiroshima
same as above
same as above

Fukuyama Recycle Electric
Generation Co., Ltd.

Refuse-derived fuel (RDF)
gasifying power generation plant(commissioned operation)

107-8 Minoki-cho, Fukuyamashi,
Hiroshima

JFE Material Co., Ltd.

Rare metal recovery plant for spent
catalysts

2-9-38 Shosei-machi, Imizushi,
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Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Water Security■ Water

Items

Scope

FY2016FY2017FY2018FY2019FY2020

million tonnes

—

241

240

242

237

ST Gr

million tonnes

238

241

238

241

236

ST

million tonnes

213

220

218

221

215

ST subsidiaries

million tonnes

24.9

20.6

20.5

19.8

20.9

EN Gr

thousand tonnes

—

832

918

1,410

1,300

EN

thousand tonnes

94

97

102

106

72

EN subsidiaries

thousand tonnes

—

735

816

1,304

1,228

SH Gr

thousand tonnes

140

166

165

149

160

SH

thousand tonnes

—

—

—

—

—

SH subsidiaries

thousand tonnes

140

166

165

149

160

ST Gr

million tonnes

—

146

144

143

141

ST

million tonnes

127

128

126

126

123

ST subsidiaries

million tonnes

—

17.8

18.0

17.0

18.3

EN

thousand tonnes

148

140

146

126

157

ST Gr

million tonnes

3,753

3,690

3,665

3,616

3,331

ST

million tonnes

3,414

3,410

3,376

3,323

3,066

ST subsidiaries

million tonnes

339

280

289

293

265

All

Amount of water
accepted*1

Amount of water
released*2

Amount of water
consumption*2

Unit

Amount evaporated

ST

million tonnes

86

92

92

95

92

Ratio of amountreleased andevaporated

ST

%

6.3

6.5

6.5

6.6

7.0

ST Gr

million tonnes

3,515

3,449

3,427

3,375

3,096

ST

million tonnes

3,201

3,190

3,158

3,102

2,851

ST subsidiaries

million tonnes

314

259

269

273

245

ST

%

93.8

93.5

93.5

93.4

93.0

ST subsidiaries

%

91

93

93

93

92

Amount recycled*2

Recycling rate*2*3*1 Coverage:- JFE Steel and 25 consolidated subsidiaries in Japan.
- JFE Engineering and 7 consolidated subsidiaries in Japan.
- 31 JFE Shoji domestic and overseas consolidated subsidiaries.
*2 25 JFE Steel consolidated subsidiaries in Japan.
*3 Industrial water circulated (%) = (Total amount − industrial water accepted)/total amount used × 100

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Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Water Related Data by Water Intake Source and Discharge Source

Items

Scope

FY2017*1

FY2018*1

FY2019*1

FY2020

million tonnes

220.6

219.3

222.0

215.5

River/lake

million tonnes

0

0

0

0

Groundwater

million tonnes

0

0

0

0

million tonnes

220.6

219.3

222.0

215.5

Ocean

million tonnes

0

0

0

0

Rainwater

million tonnes

0

0

0

0

Other intake source

million tonnes

0

0

0

0

Total amount released

million tonnes

130.2

127.5

127.9

125.0

million tonnes

129.7

127.0

127.5

124.5

million tonnes

0

0

0

0

million tonnes

0

0

0

0

Off-site water processing

million tonnes

0.43550.44310.45020.4796

Beneficial use/other use

million tonnes

0

0

0

0

Other discharge source

million tonnes

0

0

0

0

Total amount acceptedIndustrial water/waterworks

All*2

Ocean
Surface water
Underground/well

All*

2

Unit

*1 Data for past fiscal years were retroactively revised for increased accuracy.
*2 Data cover JFE Steel and JFE Engineering.

Water Security (Supplementary Data)■ Amount of Water Accepted and Released at JFE Steel Group Subsidiaries (FY2020)

Amount accepted(unit:tonnes)

Company nameAmount released(unit:tonnes)

JFE MINERAL COMPANY, LTD.

2,439,154

2,440,952

JFE ROCKFIBER CORPORATION

62,01062,010Mizushima Ferroalloy Co., Ltd.

419,063

24,7094,049,364

4,049,364

CHIBA RIVERMENT AND CEMENT CORP.

17,435

17,435

MIZUSHIMA RIVERMENT CORP.

16,594

16,594

JFE PRECISION CORPORATION

437,485

437,485

JFE Plastic Resource Corporation

15,871

12,817

JFE Bars & Shapes Corporation

4,767,501

3,046,728

JFE Material Co., Ltd.

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ESG Data

Amount accepted(unit:tonnes)

Company name

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesAmount released(unit:tonnes)

JFE Metal Products & Engineering Inc.

94,652

124,699

JFE KENZAI FENCE CO., LTD.

68,39068,390JFE Galvanizing & Coating Co., Ltd.

822,695

637,519

JFE Container Co., Ltd.

250,560

250,560

JFE Welded Pipe Manufacturing Co., Ltd.

43,85343,853

JFE Steel Pipe Co., Ltd.

1,554

1,554

Galvatex Corporation

700,980

700,980

JFE Pipe Fitting Mfg. Co., Ltd.

3,742

33,672

JFE Techno-wire Corporation

80,76380,763

JFE Kozai Corporation

13,673

13,673

GECOSS CORPORATION

68,00462,350

JFE LOGISTICS CORPORATION

103,048

103,048

J-Logitec Co., Ltd.

3,233

3,233

JFE Chemical Corp.

5,936,163

5,616,840

K-PLASHEET CORPORATION

31,123

17,307

JFE LIFE CORPORATION

494,266

481,084

20,941,176

18,347,619

Total■ Amount of Water Accepted at JFE Engineering Group Subsidiaries (FY2020)

Company nameAmount accepted (unit: thousand tonnes)

J&T Recycling Corporation

1,164

JFE Environmental Service Corporation

0.03

NORTHERN JAPAN MACHINERY Corporation

0.003

Tohoku Dock Ironworks Corporation

33.2

JFE Aqua Machine and Service Corporation

0.002

Fujikako, Inc.

0.02

J Farm Corporation

31.0

Total

1,228

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External
Evaluations
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ESG Data

Editorial
PolicyGuideline
Indices

Social Data
Responsibility to Customers■ Customer Training (FY2019*1)

Name of training

Scope

Unit

Technical presentation by overseas Group
companies(number of participating companies*2)

JFE Shoji

People(companies)

Training for overseas employees

JFE Shoji

PeopleParticipants
33 (15)24*1 The table shows FY2019 results since customer training sessions were canceled in FY2020 due to the COVID-19
pandemic.
*2 Data covers 9 countries for the number of participating companies.

Occupational Health and Safety■ Lost-work Injuries and Accidents

Items
Lost-work injuries*2
Severity*3
Lost-work injuries*2
Lost-work
Injuries andSeverity(Rates)Severity*3
Lost-work injuries*2
Severity*3
Lost-work injuries*2
Severity*3

Scope*1
JFE SteelJFE
Engineering
JFE ShojiGroup
Manufacturingindustry
average

Unit

2016

2017

2018

2019

2020

—

0.21

0.17

0.17

0.28

0.23

—

0.15

0.15

0.15

0.30

0.08

—

0.19

0.71

0.82

0.45

0.35

—

0.30

0.02

0.02

0.62

0.01

—

1.16

1.22

0.60

1.00

0.76

—

0.41

0.97

0.04

0.02

0.04

—

1.15

1.02

1.20

1.20

1.21

—

0.07

0.08

0.10

0.10

0.07

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Environment

Items
Lost-work injuries
Fatal injuries
Lost-work injuries
Number of
lost-work
injuries

Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries

Lost-work
Injuries Involving
Employees

Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries

Lost-work
injuries involving
employees ofcontractors

Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries

SocialGovernance

Scope*1
JFE Group

JFE SteelJFE
Engineering
JFE ShojiGroup
JFE Group

JFE SteelJFE
Engineering
JFE ShojiGroup
JFE Group

JFE SteelJFE
Engineering
JFE ShojiGroup

Editorial
PolicyGuideline
Indices

Unit

2016

2017

2018

2019

2020

Cases

35

42

41

49

36

Cases

3

3

2

6

1

Cases

22

18

18

30

23

Cases

2

2

2

4

1

Cases

4

14

18

11

7

Cases

1

0

0

2

0

Cases

9

10

5

8

6

Cases

0

1

0

0

0

Cases

14

13

13

18

15

Cases

1

2

1

1

0

Cases

6

4

7

10

9

Cases

1

1

1

1

0

Cases

0

0

1

2

2

Cases

0

0

0

0

0

Cases

8

9

5

6

4

Cases

0

1

0

0

0

Cases

21

29

28

31

21

Cases

2

1

1

5

1

Cases

16

14

11

20

14

Cases

1

1

1

3

1

Cases

4

14

17

9

5

Cases

1

0

0

2

0

Cases

1

1

0

2

2

Cases

0

0

0

0

0

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External
Evaluations
and Awards

ESG Data

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices*1 Scope of data:• JFE Steel and JFE Engineering: parent company, business associates and contractors in Japan• JFE Shoji : parent and consolidated subsidiaries, business associates and contractors in Japan*2 Lost-work injuries (rate) = number of employees with lost-work injuries/total working hours × 1,000,000*3 Severity = number of lost working days/total working hours × 1,000■ Health and Safety Training (2020)

Items

Unit

Participants*

Training for managers and supervisors

People331

Mental healthcare education for new hires and at rank-based training

People749* Total of 3 operating companies.

■ Employee Health Data

Items
Metabolic syndrome rates
Smoking rates
Rate of health examination for
dependents

Scope

Unit

2016

2017

2018

2019

2020

Insured by the JFEGroup’s health insurance
union (age 40 and above)

%

35.4

35.9

36.0

35.6

36.5

%

33.2

32.6

31.7

31.1

30.0

Age 40 and above

%

42.1

43.7

48.2

51.5*

46.3

Unit

2016

2017

2018

2019*22020

JFE Steel

%

17.8

36.8

56.9

64.2

53.0

JFE Engineering

%

12.9

22.7

22.1

39.6

39.1

JFE Shoji

%

21.9

25.0

45.2

36.0

41.6

JFE Steel

%

45.7

46.0

52.3

49.4

48.0

JFE Engineering

%

46.4

47.3

54.2

52.4

47.2

JFE Shoji

%

53.5

55.1

52.4

61.7

53.2

*Data in 2019 have been revised from preliminary to final data.

■ Health Data for Employees and Their Family

Items

Provision rate of health guidanceRate of health examination for
dependents*1

Scope*1 Scope: dependents (including spouses and others) age 40 and above*2 Data in 2019 have been revised from preliminary to final data.

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External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesLabor Practice■ Employee Data (2020)

Unit

JFE SteelJFE
Engineering

JFE Shoji

Employees

people45,797

10,612

7,910

Male

people40,054

9,141

5,757

people

5,743

1,471

2,153

people11,717

3,508

1,625

Male

people11,022

3,311

1,418

Femalepeople

695

197

207

%

5.9

5.6

12.7

Category

Consolitaded/
non-consolitaded

FemaleManagement positions*3

Conslidated*1

Ratio of women in management
positions
Employees

people16,089

3,866

1,003

Male

people14,7183,324

598

Femalepeople

1,371

542

405

people

2,781

2,401

629

Male

people

2,616

2,257

592

Femalepeople

165

144

37

%

5.9

6.0

5.9

people

489

138

43

Male

people

452

122

24

Femalepeople37

16

19people

448

77

40

people

41

61

3

year

15.8

14.4

14.0

Male

year

15.4

14.4

14.7

Female

year

18.2

14.5

12.8

%

3.1

1.5

3.7

people

626

44

31

Ratio of rehired employees

%

3.9

1.1

3.1

Average annual leave taken

day/year

13.2

17.2

10.4

Average overtime

hours/
month

15.0

24.3

29.8

Employees working shorter hours forchildcare (aggregated)people81

70

62

Temporary staffs

people

169

652

16

Management positions*3

Ratio of women in management
positions
Recruits

New graduates
Mid-career

Non-consloitaded*2

Years of continuous employment (average)

Job turnover rate*4 (Total 2.9%)
Rehired employees

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Evaluations
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ESG Data

Editorial
PolicyGuideline
Indices*1 Scope of data: Consolidated subsidiaries (JFE Steel: 149, JFE Engineering: 72, JFE Shoji: 88)*2 As of April 1, 2021. Other figures are as of FY2020.
*3 Management positions at JFE Shoji include employees on loan.
*4 Percentage of employees who voluntarily choose to resign from the organization.

■ Recruiting (Three Operating Companies, Excluding their Subsidiaries) for New Graduates (FY2021) andMid-career Recruits (FY2020)
Career-track Positions
Items

Unit

Whitecollar

Technical

On-siteand Clerical
Positions

Total

Total

Male

people

66

200

266

332

598

Femalepeople

20

20

40

32

72

Total

people

86

220

306

364

670

%

23.3

9.1

13.1

8.8

10.7

Ratio of women■ Employment of People with Disabilities (as of June 1 of each year)
Items

Scope

Employment of People with Disabilities

Unit

2016

2017

2018

2019

2020

JFE Steel

%

2.34

2.33

2.41

2.48

2.51

JFE Engineering

%

2.01

2.14

2.39

2.23

2.37

JFE Shoji

%

1.86

2.20

2.62

2.50

2.39

Community■ Social Contributions (FY2020)
Activities

Scope

Unit

Achievements

People

1,571

JFE SteelPeople400

JFE Engineering

People586

JFE Shoji

People585

Masks

12,500Books

17,000Cans

12,500JFE Group
Internships

Masks for children
Supporting elementary schools
in Ghana and Nigeria

Notebooks

JFE Shoji

Canned foods

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Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices■ JFE 21st Century Foundation (FY2020)
Grants

Projects

Technology research (accumulated)
Technology research
for FY2020

Value (million yen)654

1,315.8

Iron and steel technology research

918

Global environment and global warming
prevention technology research

13

26

138

207

8

12

technology research 13 26
Asian history studies for FY2020
Activities

Sets donatedSupporting the Japan Overseas Educational Services Writing Contest andanthology donation (to elementary and middle schools and also public libraries
in the regions related to steel*)

2,400* Donated to 663 elementary and middle schools and 73 public libraries.

Shareholders and Investors■ Major IR Activities (FY2020)

Major communication methods, etc.

Number of sessions

Investors meeting, ESG briefings
Individual interviews with institutional investors and securities
analysts
Briefings for Individual investor (at the branch offices of
securities firms, etc.)

participation (people)
5

Approx.600

As needed

Approx.300

4

Approx.1,500

Number ofsessions

Participants■ Plant Tours and Company Briefing Sessions (FY2019*)

Activities
Plant tours and company briefing
sessions

Scope
JFE Steel
JFE Engineering
Japan Marine United

23

1,800

*This table shows FY2019 results since plant tours and company briefing sessions were canceled in FY2020 due to the
COVID-19 pandemic.

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Evaluations
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ESG Data

Editorial
PolicyGuideline
Indices

Governance Data
Corporate Governance■ Corporate Governance System

As of July 1, 2021

Items

Overview of the system

Organizational design typeCompany with an Audit & Supervisory Board

Number of Directors (members)

8

The number of Independent Outside Directors (members)

3

The number of female Directors (member)

1

Number of Audit & Supervisory Board Members (members)

5

The number of Independent Outside Audit & Supervisory
Board Members (members)

3

The number of femal Audit & Supervisory Board Members(members)

1

Term for Directors (years)

1

Term for Outside Directors (years)

1

Corporate Officer System

AdoptedNomination Committee and Remuneration
Committee

Voluntary advisory committees of the Board of Directors■ Directors and Audit & Supervisory Board members

Position

Director

Name

InsideAs of July 1, 2021

Significant
concurrent post

Number of
Number of meetings ofmeetings of the Audit&
Independent the Board of
executive
Directors Supervisory
Board
attendedattendedin FY2020
in FY2020

Koji Kakigi

Chairman of the Board of
Directors of JFE 21st Century
Foundation (Public Interest
Incorporated Foundation)

ー

15/15
(100%)

ー

Yoshihisa Kitano

Representative Director,
President and CEO of JFE
Steel Corporation

ー

15/15
(100%)ー

Masashi Terahata

Director of JFE SteelCorporation,
Representative Director of JFE
21st Century Foundation(Public Interest Incorporated
Foundation)

ー

15/15
(100%)ーJFE GROUP CSR REPORT 2021

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Position

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SocialEditorial
PolicyGuideline
IndicesNumber of
Number of meetings ofmeetings of the Audit&
Independent the Board of
executive
Directors Supervisory
Board
attendedattendedin FY2020
in FY2020

Hajime Oshita

Representative Director,
President and CEO of JFE
Engineering Corporation

ー

15/15
(100%)

ーToshinori Kobayashi

Representative Director,
President and CEO of JFE
Shoji Corporation

ー

ー

ー

Masami Yamamoto

Director and Senior Advisor of
Fujitsu Limited,
Outside Director of Mizuho
Financial Group, Inc.

〇

15/15
(100%)

ー

Nobumasa Kemori

Honorary Advisor of umitomo
Metal Mining Co., Ltd.,
Outside Director of NAGASE &CO., LTD.,
Outside Director of Sumitomo
Realty & Development Co.,
Ltd.

〇

15/15
(100%)

ー

Yoshiko Ando

Audit & Supervisory Board
Member of Kirin Holding
Company,
Limited, Outside Director of
Sansei Technologies, Inc.

〇

12/12
(100%)

ー

Nobuya Hara

Audit & Supervisory Board
Member of JFE SteelCorporation

ー

15/15
(100%)

18/18(100%)

Kumiko Baba

Audit & Supervisory Board
Member of JFE Engineering
Corporation,
Audit & Supervisory Board
Member of JFE Shoji
Corporation

ー

15/15
(100%)

18/18(100%)

Shigeo Oyhagi

Advisor of Teijin Limited,
Outside Director of KDDI
CORPORATION,
Outside Director of MUFG
Bank, Ltd,
Outside Director of Tokyo
Electric Power Company
Holdings, Inc.

〇

15/15
(100%)

18/18(100%)

Isao Saiki

Partner Lawyer of Abe, Ikubo& Katayama Law Firm

〇

15/15
(100%)

18/18(100%)

Tsuyoshi Numagami

Professor, Graduate
xchool of Business
Administration, Department
of Business Administration of
HITOTSUBASHI UNIVERSITY

〇

15/15
(100%)

18/18(100%)

InsideDirector

InsideAudit &
Supervisory
Board
MemberExternal
Evaluations
and Awards

ESG Data

Significant
concurrent post

Name

OutsideGovernanceOutsideNote: The number of meetings of the Board of Directors held during FY2020 differs for Ms. Yoshiko Ando, as she was newly
elected as a director at the previous year's Ordinary General Meeting of Shareholders (held on June 19, 2020).

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External
Evaluations
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ESG Data

Editorial
PolicyGuideline
Indices■ Nomination Committee and Remuneration Committee
As of July 1, 2021
Items

Members

Nomination Committee

Chairperson

Number of meetings
held during FY2020

6

Inside Director

2

Outside Director

2

Outside Audit & Supervisory Board Member

2

Remuneration Committee

6

Inside Director

2

Outside Director

2

Outside Audit & Supervisory Board Member

2

Masami Yamamoto(Outside Director)

4

Nobumasa Kemori(Outside Director)

5■ Operating System

Committee
Group Management
Strategy Committee

Company

Chairperson

JFE Holdings

President

Inside Directors (including 3 operating company
Presidents), Corporate Officers and full-time
Audit & Supervisory Board Members

JFE Holdings

President

Inside Directors (excluding 3 operating company
Presidents), Corporate Officers and full-time
Audit & Supervisory Board Members

Each operatingcompany

President

Directors, major Corporate Officers and Audit &Supervisory Board Members

Management Committee

Attendees

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External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices■ Executive Remuneration
FY2020Executive remuneration
Total amount by remuneration type (thousand yen)
Total
Number of
remuneration,
Stock remuneration
Executives
Basicetc. (thousandBonus(members)
Linked to
Linked to
remuneration
yen)
performance service length

Position Type

Directors (excluding Outside
Directors)

199,166

185,5020

0

13,664

5

Audit & Supervisory Board
Members (excluding Outside
Audit & Supervisory Board
Members)

78,33578,335ーーー

2Outside Directors/ Audit &Supervisory Board Members

91,847

91,847ーーー

7Officers whose consolidated remuneration exceeded 100 million yen
Name

Position

Per company(thousand yen)Company

Total(thousand yen)

Koji Kakigi

Director

JFE Holdings

106,847

Yoshihisa
KitanoDirector

JFE Holdings

12,000

Director

JFE Steel

94,847

106,847
106,847

Ratio of remuneration for each
Basic remuneration:
fixed (%)

Annual bonus:
linked to short-term erformance(%)

Stock remuneration:linked to medium- tolong-term performance (%)

60

20

20

Note: The ratios above are applicable only when the company’s president has attained the performance target goals.

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Indices■ Internal Control System
As of April 1, 2021
Internal control system
Number ofcompanies(companies)

Items
Internal audit

Audit & Supervisory
Board

Number of people
assigned(members)

Internal audit organizationー

174

Full-time Audit &Supervisory Board Members

29

34

Dispatched Audit & Supervisory Board Members(part-time Audit & Supervisory Board member)29

11

Cooperation of Audit & Supervisory Board members
Items

Number of meeting held during FY2020

Accounting auditor

7

Internal Audit Department

6Compliance (including Anti-corruption)■ Whistleblowing

Items
Cases handled by the
Corporate Ethics Hotline

Scope

Unit

FY2018FY2019FY2020

JFE Holdings and operatingcompanies

Cases

80

101

87

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External ESG Evaluations
FTSE4Good Index Series and FTSE Blossom Japan Index
JFE Holdings has been chosen for two consecutive years as a constituentof the FTSE4Good Index Series and FTSE Blossom Japan Index, investment
indexes provided by FTSE Russell, a subsidiary of the London Stock
Exchange Group. Both indexes select companies that demonstrate strong
environmental, social, and governance (ESG) practices and are widely used in
the creation or assessment of sustainable investment funds or other financial
products. The FTSE Blossom Japan Index is an ESG investment index
adopted by the GPIF, one of the world’s largest pension fund managers.

MSCI Japan Empowering Women (WIN) Select Index
JFE Holdings has been selected to the MSCI Japan Empowering Women(WIN) Select Index provided by U.S.-based MSCI Inc. The index is composedof companies that excel in their ESG evaluation. Top 700 constituents of
the MSCI Japan Investable Market Index (IMI) are rated in a multifaceted
evaluation of their initiatives on gender diversity, and the top half of highscoring companies from each industry are selected to the index. The WIN is
an ESG investment index adopted by the GPIF.

S&P/JPX Carbon Efficient Index
JFE Holdings is a constituent of the S&P/JPX Carbon Efficient Index, which
is jointly developed, calculated and published by U.S.-based S&P Dow Jones
Indices and the Japan Exchange Group. The weighting of constituents in theindex is determined by the status of corporate disclosure for environmental
information and the level of carbon efficiency, or carbon emissions per unit ofrevenue. The index is an ESG investment index adopted by the GPIF.

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and Awards

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Indices

Evaluation Based on CDP 2020
Established in Britain in 2000, the Carbon Disclosure Project (CDP) is a nongovernmental organization that conducts
ESG evaluations. It calls on companies to disclose ESG-related information by responding to CDP questionnaires tofacilitate the ESG investment decisions of institutional investors. Currently, the CDP covers three environmental areas:climate change, water security, and forests, and companies are rated on an eight-point scale (from A to D-) for each area.
The volume of information collected by the CDP has become one of the largest in the world, with currently over 300
companies responding to the questionnaires, which are widely used in various indexes by institutional investors and forsocially responsible investment.
The JFE Group actively participates in CDP initiatives as a member of the CDP Reporter Service and responds toclimate change and water security questionnaires every year. We made sure to disclose appropriate information for the
CDP 2020 questionnaire, and as a result we received a high rating.
CDP 2020 score: climate change: B, water security: A-, supplier engagement: A-

DBJ Environmentally Rated Loan Program
The Development Bank of Japan (DBJ) Environmentally Rated Loan Program
uses a screening (rating) system developed by DBJ to evaluate environmental
management and then assign a corresponding interest rate from three levels.
This was the world’s first loan program to incorporate environmental ratings in
its financing menus. In March 2016, JFE Holdings was rated as a top-ranking
company that pursues excellent and advanced environmental initiatives
resulting in outstanding environmental-management performance, based on
which the company secured a loan under the program.

SOMPO Sustainability Index
JFE Holdings has been chosen for ten consecutive years as a constituent of
the SOMPO Sustainability Index (former: SNAM Sustainability Index), which
was launched by Sompo Asset Management Co., Ltd. The index, which
encompasses companies with highly evaluated ESG ratings, contributes
to investor asset formation by evaluating corporate value from a long-term
perspective.

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DBJ Employees’ Health Management Rated Loan Program
The DBJ Employees’ Health Management Rated Loan Program is the world’s
first financing menu that bases loan conditions on DBJ’s proprietary system
for rating health management for the purpose of selecting and evaluatingcompanies based on their performance in this area.
JFE Holdings’ efforts in pursuing employee health management has beenhighly regarded, and it is rated as a top-ranking company under the program.

Certified as a “White 500” Organization under the 2021 Certified Health andProductivity Management Outstanding Organizations Recognition Program
JFE Engineering was selected to the White 500 list of top 500 outstandingorganizations in health and productivity management in 2021. This program
is jointly sponsored by Japan’s Ministry of Economy, Trade and Industry(METI) and the Nippon Kenko Kaigi to recognize organizations under the large
enterprise and small and medium enterprise categories that are practicing
particularly excellent health and productivity management.
JFE Engineering implements continuous and effective PDCA activities byadopting a health management system and conducting company-wide healthsurveys to gain a chronological understanding of employee awareness of
wellbeing, lifestyles and health risks. Furthermore, the Company establishedthe JFE Engineering Health Declaration in March 2018 to internally andexternally communicate its initiatives on health management. Recognition ofthese initiatives led to the latest certification.
This is the third time JFE Engineering has been certified as a White 500
Organization and it has been selected as an Outstanding Organization in
Health and Productivity Management for four consecutive years.

Caterpillar Quality Assurance Certification
In FY2021, JFE Steel West Japan Work (Kurashiki District) and JFE Shojicompleted an online audit under COVID-19, successfully upgrading its
certification for the fifth consecutive year as Gold Level SQEP suppliers in
the Supplier Quality Excellence Process, a quality certification of the U.S.based construction equipment manufacturer Caterpillar Inc. The program
ranks suppliers for compliance with ISO 9001 standards and Caterpillar’s own
specifications and certifies the top firms as Platinum, Gold, Silver, or Bronze.
Only a few companies in Japan have received Gold Level certification, andJFE Steel is the world’s first blast furnace company to be certified.
Receiving the Gold certification plaque(2020)JFE GROUP CSR REPORT 2021

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Non-ESG External Evaluation
Digital Transformation Stocks 2021
JFE Holdings was selected as one of the Digital Transformation Stocks (DXStocks) 2021 by the Ministry of Economy, Trade and Industry (METI) and theTokyo Stock Exchange (TSE) in recognition of its active promotion of digitaltransformation.
For five years until 2019, METI and TSE had selected the company
as a Competitive IT Strategy Company Stock because of its strategic IT
investments to increase medium-to long-term corporate value and bolster
competitiveness. In 2020, this stock selection was renamed to DX Stocks toreflect its current focus on digital transformation for new corporate growth.
Including its selection as a Competitive IT Strategy Company Stock, thecompany has essentially been recognized for its efforts in this area for sevenconsecutive years.

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ESG Data

External
Evaluations
and Awards

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Evaluations
and Awards

Editorial
PolicyExternal Awards
Judging Committee Special Excellence Award of the 24th Environmental
Communication Awards
JFE Group CSR REPORT 2020, issued in September 2020, won the Judging Committee
Special Excellence Award of the 24th Environmental Communication Awards, hosted jointly
by the Ministry of the Environment and Global Environmental Forum. This is the second
consecutive year that the JFE Group has been recognized by these Awards.
Environmental Communication Awards recognize outstanding environmental reports
targeting multi-stakeholders with the goal of promoting environmental communication
between parties involved in the business and to further invigorate environmental initiatives
among various media, such as CSR reports, integrated reports, and environmental
management reports. For the 24th awards, 147 reports were submitted for judgement underthe environmental report category and 114 reports under the environmental management
report category. The JFE Group was recognized as one of four recipients of the Judging
Committee Special Excellence Award under the environmental reporting category. The award
ceremony was held online on February 17, 2021.
Please see the following for further details.
JFE Group CSR REPORT 2020 receives Judging Committee Special Excellence Award of the 24th
Environmental Communication Awards (Japanese only) (https://www.jfe-holdings.co.jp/release/2021/02/210218.html)

2nd ESG Finance Awards Japan, Special Award in the Environmentally
Sustainable Company Category
JFE Group CSR REPORT 2020, issued in September 2020, received the Special Award in
the Environmentally Sustainable Companies category of the 2nd ESG Finance Awards Japan
sponsored by the Ministry of the Environment . This is the first time the JFE Group hasreceived this award.
ESG Finance Awards Japan was founded for the purpose of commending institutional
investors, financial institutions, intermediaries and companies that have made an outstanding
impact on the environment and society by proactively engaging in ESG finance as well as
environmental and social projects, and to share their advanced initiatives with the generalpublic. The Environmentally Sustainable Companies category was established to recognize
investment decisions based on an understanding of the impact of environmental elementson corporate value and to promote corporate management that incorporates environmental
elements and disclosure of the status of related initiatives. The Special Award was recently
created to recognize companies for outstanding initiatives particularly with respect to their size
and industry characteristics. The awarding ceremony was held online on February 24, 2021.
Please see the following for further details.
JFE Group Received the Special Award in the Environmentally Sustainable Companies category of the 2nd
ESG Finance Awards Japan (Japanese only) (https://www.jfe-holdings.co.jp/release/2021/02/210225.html)

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Editorial
PolicyWorld Steel Association 2020 Steel Sustainability Champions
JFE Steel was recognized by the World Steel Association as a 2020 Steel Sustainability
Champions.
Once a year, the World Steel Association commends member companies fordemonstrating leadership in developing a sustainable steel industry and society and showing
outstanding results in enhancing sustainability. JFE Steel, which became the first in theJapanese steel industry to receive the World Steel Association’s Steelie Award (Innovationof the year) *, has been developing innovative technology for reducing environmental
impact. In addition, JFE Steel actively discloses its basic policies and measurement data on
sustainability in areas such as the environment and occupational health and safety throughpublications including the JFE Group CSR REPORT 2020 to its stakeholders. Recognition ofthese efforts led to the the Award.
*

JFE Steel won the Steelie Award 2020 from the World Steel Association for developing a resource-saving,silicon-gradient material for high-speed motors (https://www.jfe-steel.co.jp/en/release/2020/201029.html)

Please see the following for further details.
JFE Steel Recognized as 2020 Steel Sustainability Champion(https://www.jfe-steel.co.jp/en/release/2021/210414.html)

Second Prize, IT Japan Award 2021
JFE Steel won second prize in the IT Japan Award 2021 organized by the Nikkei Computer
magazine in recognition of its efforts on the blast furnace CPS*1 and “J-mAIsterTM*2 “ .
The IT Japan Award was introduced in 2007 as a means of recognizing companies thatshow outstanding results based on the construction and effective use of information systems
and to widely share the learnings from their success. Selected from articles published in the
Nikkei Computer magazine over the past year (from May 2020 to April 2021), the award ispresented for excellent cases of IT use from the perspectives of contribution to management
innovation and business process reengineering, originality of system construction and use,
and level of innovative technology and methodology.
*1

JFE Steel Introducing Data Science Technology at All Steelworks Blast
Furnaces— Conversion to cyber-physical systems expected to enhance
productivity — (https://www.jfe-steel.co.jp/en/release/2019/191105.html)*2

JFE Steel adopts IBM Watson to significantly to shorten the failure recovery
time—Making safe and flexible use of cutting-edge technology in a hybrid
cloud environment (Japanese only)(https://www.jfe-steel.co.jp/release/2019/03/190307.html)

Please see the following for further details.
JFE receives second prize in the IT Japan Award 2021 (Japanese only)(https://www.jfe-steel.co.jp/release/2021/06/210608.html)

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External
Evaluations
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Editorial
PolicyExternal Awards for Research and Development■ Awards for Technologies and Product Developments (FY2020)

Prize/Award

JFE SteelJFE
Engineering

Project

Sponsor

Steelie Awards 2020

Development of resource saving
type Si gradient steel sheet for
high-speed motors

World Steel Association

FY2021 Commendation for
Science and Technology by
the Minister of Education,
Culture, Sports, Scienceand Technology (Prizes for
Science and Technology,
Development Category)

Development of production
technology for hot-dip galvanizedsteel sheets by control of
atmospheric conditions

Ministry of Education,
Culture, Sports, Scienceand Technology

53rd (FY2020) The Ichimura
Prize in Industry for
Outstanding Achievement

Chromium Ore Smelting
Reduction Process Using
Hydrocarbon Fuel Burner

Ichimura Foundation for
New Technology

FY2020 Prize of the
Chairman of ECCJ for
Energy Conservation Best
Practices at Workplaces,
Energy Conservation Grand
Prize Award

Development of energy supply
and demand guidance utilizing
data science

The Energy Conservation
Center, Japan

KEIDANREN
Recommended Company
Newsletter Review 2020,
Overall Prize

JFE Steel Magazine

Company Newsletter
Center, KEIDANREN
Business Services

55th Japan Society for
the Promotion of Machine
Industry President's Award(Machine Promotion
Award)

Surface inspection equipment
based on twin-illumination andsubtraction technique

Japan Society for the
Promotion of Machine
Industry

FY2020 Japan Institute ofInvention and Innovation
Chairperson’s Award(National Commendation
for Invention)

Invention of concave and convex
defect inspection equipment bymagnetic flux leakage testing
methodJapan Institute ofInvention and Innovation

New Global Niche Top 100
Companies

High brittle crack arrest steel
plate for super-large container
ships

Ministry of Economy,
Trade and Industry

46th Prize of DirectorGeneral, Industrial Scienceand Technology Policy andEnvironment Bureau, METI,
for Excellent Environmental
Equipment Award

Automated incinerator for
general waste incorporating AI
and data analysis technology

The Japan Society ofIndustrial Machinery
Manufacturers

IT Excellence Award 2020

JFE Engineering’s initiatives
for promoting DX –Striving
to normalize change throughdigitization

Japan Institute ofInformation Technology

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Indices

Steelie Awards 2020

FY2020 Japan Institute of Invention and Innovation
Chairperson's Award

53rd (FY2020) Ichimura Prize in Industry for
Distinguished Achievement

FY2020 ECCJ for Energy Conservation Best Practices
at Workplaces, Energy Conservation Grand Prize Award

FY2021 Commendation for Science and Technology by the Minister of
Education, Culture, Sports, Science and Technology (Prizes for Science andTechnology, Development Category)

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PolicyGuideline
IndicesThird-party Comments

Yoshinao Kozuma
Emeritus Professor
Sophia University

1. Seventh Medium-term Business Plan
In the Seventh Medium-term Business Plan , which began in FY2021, the JFEGroup clearly stated its strategic policy of pursuing sustainable growth overthe medium- to long-term by establishing economic sustainability groundedin environmental and social sustainability. It also aims to achieve its missionof playing an essential role in ensuring society’s sustainable development andcreating safe and comfortable lives for people everywhere . This indicates that
the Group has established a management structure that regards sustainability
as the foundation for its business strategies and represents a powerfulcommitment to its vision of pursuing further growth in a sustainable society. While the JFE Group has already been
making steady progress in its CSR management, I feel this major advance from its Sixth Medium-term Business Plan topursue compatibility with a sustainable society ushers in a new phase of sustainable management for the Group.

2. JFE Group Environmental Vision for 2050
The JFE Group Environmental Vision for 2050 is clearly the pillar of the Group’s environmental sustainability efforts. Justin the previous fiscal year, the JFE Group announced its target of reducing CO2 emissions from the steel business by atleast 20% from FY2013 levels. It has already progressed further this fiscal year by declaring its Environmental Vision for2050, under which it intends to reduce CO2 emissions by 18% from FY2013 levels by the end of FY2024 and achievecarbon neutrality by 2050. Publicly moving up the target reduction volume and period within such a short time span has
created a sense of urgency to achieve the goals of the Group’s climate policy. In addition, the Group is demonstrating
leadership in resolving climate change issues by means of carbon-recycling blast furnaces and CCU that require its highly
original technological expertise, indicating it is doing much more than simply collaborating with the industry to achieve
the goals of the climate policy.

3. Human Rights Due Diligence
In terms of social sustainability, key points are eliminating accidents at workplace by facilities themselves as well as
safety educations and rule compliance for achieving zero severe accidents and initiatives on human rights due diligence.
The global community has come to expect businesses to pursue both of these efforts to demonstrate respect for humanrights, and in particular, a movement is rapidly developing in Europe to create a regulatory framework for human rights
due diligence. The JFE Group’s fast development of an internal system for due diligence is a significant accomplishment
in terms of risk management.

4. Future Challenges
Compared to the environmental data, which is increasingly being disclosed on a consolidated basis, social dataremains mainly non-consolidated, and this is a point for improvement. In particular, lost-work injury and accidents data,
employment ratios for people with disabilities, and job turnover rates are often used as key indicators for labor initiatives
and are also necessary for evaluating the effectiveness of human rights due diligence. In regard to the corporate website,while it is periodically upgraded, the volume of information has grown to massive proportions over the years, and further
consideration is needed to facilitate its use.
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IndicesMariko Kawaguchi
Specially appointed professor of Graduate School of Social Design Studies,
Rikkyo University
This is my fifth year of offering third-party comments. These five years would
be viewed as a turbulent period for capitalism when we look back from sometime in the future. During this period, the SDG concept gained broad public
acceptance, the decarbonization of society became a common global goal,
and many environmental issues moved from the peripheries of business into
mainstream issues of the highest priority. In particular, addressing climatechange has emerged as a prerequisite for economic activity. The preservationof biodiversity also gained recognition as a vital issue this year. Meanwhile, the
COVID-19 pandemic has directed a spotlight on social concerns such as thehuman rights of workers and disparities in wealth.
Under these circumstances, the JFE Group deserves to be highly commended for actively pursuing a decarbonization
strategy by turning the demerits of its carbon-intensive steelmaking business to its advantage. Two years ago, the Group
became a pioneer among Japanese companies to formulate a scenario in accordance with TCFD recommendations,
thereby providing a model for the decarbonization strategies of numerous Japanese companies. Moreover, the JFEGroup created a CO2 reduction road map last year for realizing carbon neutrality. This year, it presented a super-longterm vision for 2050 and declared its intention to achieve carbon neutrality by 2050. Concurrently, it announced a new
medium-term business plan that upholds the ambitious target of reducing CO2 emissions by 18% from its steel businessby FY2024, the final year of the plan.
Generally speaking, the emphasis on a super-long-term vision is embodied in the declaration of the Group’scommitment to that vision. On the other hand, the medium-term plan presents feasible targets. The steelmaking industry
uses fossil fuel as a raw material, and it was thought that the decarbonization of this industry would be even more difficult
to achieve than for the energy sector. The reduction plan expressed in the JFE Group’s medium-term business plansignifies the powerful message that the path to the decarbonization of steelmaking has now become clear.
Along with pursuing new technologies such as the carbon-recycling blast furnaces, hydrogen-based direct reduction
ironmaking , and low carbon technology mentioned in the message from the CEO, I expect the Group to further
accelerate the promotion of energy conservation, where it has been making steady progress, as well as its low-carbon
strategy for its business portfolio, including its electric arc furnace and renewable energy businesses, at the same time.
Declaring your pursuit of decarbonization within the steelmaking industry, which had been seen as a carbon-intensive
business, will stimulate other industries and society as a whole toward reducing carbon emissions. I have high hopes that
the JFE Group will exercise even stronger leadership.
Based on these observations, I’d like to point out a few areas where I hope to see the JFE Group demonstrate its
leadership. The first area is adaptation which is another aspect of climate change. Intensified natural disasters suchas flooding and storm surges due to super-sized hurricanes and typhoons, as well as large-scale wildfires, are causing
severe damage to urban living, distribution, energy infrastructure, farmland, and forests around the world. We are at apoint where society as a whole must adapt to the intensifying natural disasters associated with climate change. The
construction of resilient systems that can withstand such disasters is a matter of utmost urgency. The development ofresilient buildings and other urban infrastructure is a pressing social issue that also offers a solid business opportunity. I
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Indiceswould like to see the JFE Group strengthen its effort to promote its climate change initiatives based on the dual pillars ofdecarbonization and resilience.
My next concern is resolving social issues in the supply chain. In general, mining sites for rare metals and nonferrous metals are known to damage ecosystems and water systems by considerably changing the landscape. They
also cause significant impact on the communities and human rights of local residents, making it a highly material social
issue. Regarding the supply chain, this current report only focuses on the Group’s procurement policy. I believe it isessential for a leading environmental company to formulate and disclose concrete policies and targets for the social andenvironmental risks inherent in its supply chain with regard to major raw materials such as iron ore and coal.
In this report, steel is described as recyclable and the most sustainable material that exists around the world.
The report also includes the Group’s initiatives for establishing a circular economy through its engineering business.
I interpreted this to mean that it is possible to develop a win-win business model addressing both recycling anddecarbonization by combining steel and engineering.
I expect the JFE Group to demonstrate its leadership by more clearly presenting a business strategy that incorporates
decarbonization and recycling as a higher level concept of individual technological strategies while paying due
consideration for diversity such as gender and race so as to steadily raise the effectiveness of the Group’s vision for2050.

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Editorial Policy
Basic ApproachThis report provides stakeholders with a comprehensive account of the JFE Group’s CSR-related initiatives and data andelicits feedback toward enhancing the Company’s activities and information disclosure. The 2021 report was compiled byadding the following content.
• Formulation of the Seventh Medium-term Business Plan and the JFE Group Environmental Vision for 2050,
determination of material issues of corporate management and designation of KPIs
• Setting of medium- to long-term CO2 reduction targets for the steel business toward achieving carbon neutrality by
2050•E nhancement of the information on climate change risks and opportunities by reviewing the structure of the contents
in line with TCFD recommendations, including scenario analysis•U pdates to provide the latest information on the development and provision of JFE Group eco-friendly processes andproducts• Designation of policies and processes for initiatives on human rights due diligence that were introduced in FY2021• Provide more information on the establishment of the risk management system

CSR Report Composition and Format
A comprehensive report on the JFE Group’s CSR activities and quantitative ESG data

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Scope of Report
Reporting Period
FY2020 (April 1, 2020 to March 31, 2021)
Reports on some activities undertaken before or after this period are included.

Organization Covered
The report mainly covers the activities of JFE Holdings, Inc. and its three operating companies: JFE Steel Corporation,
JFE Engineering Corporation, and JFE Shoji Corporation, but also includes reports on activities of other companies in the
JFE Group (406 companies, of which 327 are consolidated subsidiaries and 79 are equity-method affiliates). Quantitative
information on the environment includes data from the following JFE Group operating companies.

S

JFE Steel Group: JFE Steel Corporation and 30 consolidated subsidiaries (total: 31

T companies)

25 domestic companies:
JFE MINERAL COMPANY, LTD., Mizushima Ferroalloy Co., Ltd., JFE Material Co., Ltd., CHIBA RIVERMENT AND
CEMENT CORP., MIZUSHIMA RIVERMENT CORP., JFE PRECISION CORPORATION, JFE Plastic Resource Corporation,
JFE Bars & Shapes Corporation, JFE Metal Products & Engineering Inc., JFE Galvanizing & Coating Co., Ltd., JFE
Container Co., Ltd., JFE Welded Pipe Manufacturing Co., Ltd., JFE Steel Pipe Co., Ltd., Galvatex Corporation, JFE
Pipe Fitting Mfg. Co., Ltd., JFE Techno-wire Corporation, JFE Kozai Corporation, JFE LOGISTICS CORPORATION, JFE
Chemical Corporation, JFE LIFE CORPORATION, GECOSS CORPORATION, JFE ROCKFIBER CORPORATION, JFE
KENZAI FENCE CO., LTD., J-Logitec Co., Ltd., K-PLASHEET CORPORATION
5 overseas companies:
Nova Era Silicon, JFE Steel Galvanizing (Thailand) Ltd., Thai Coated Steel Sheet Co., Ltd., Philippine Sinter Corporation,
PT. JFE STEEL GALVANIZING INDONESIAE

JFE Engineering Group: JFE Engineering Corporation and the following 11 consolidated

N domestic subsidiaries (12 companies in total)

11 domestic companies:
J&T Recycling Corporation, JFE Environmental Service Corporation, NORTHERN JAPAN MACHINERY Corporation,
Tohoku Dock Ironworks Corporation, JFE Aqua Machine and Service Corporation, Fujikako, Inc., Asuka Soken Co., Ltd.,JFE Pipeline Engineering Corporation, JFE Technos Corporation, J Farm Corporation, JFE Business Support
YOKOHAMA Corporation

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JFE Shoji Corporation Group: JFE Shoji Corporation and the following 33 domestic andH overseas consolidated subsidiaries (steel-processing companies) (total: 34 companies)

19 domestic subsidiaries:
JFE Shoji Electrical Steel Co., Ltd. JFE Shoji Coil Center Corporation, JFE Shoji Kohnan Steel Center Co., Ltd., Shoji
Tinplate Center Corporation, Aichi Kanzai Kogyo Corporation, Kyusyu-Tech Corporation, JFE Shoji Kohnan SteelCenter Co., Ltd. Shin Nihon Kogyo Corporation, Taisei Kogyo Corporation, Toyo Kinzoku Corporation, Tochigi Shearing
Corporation, Naigai Steel Corporation, Nagano Can Corporation, Niigata Steel Corporation, Nihon Jiseizai Kogyo Co.,
Ltd., Hokuriku Kogyo Corporation, Hokuriku Steel Co., Ltd., Mizushima Steel Corporation, Mizushima Metal Products
Corporation
14 overseas subsidiaries:
Dongguan JFE Shoji Steel Products Co., Ltd., Guangzhou JFE Shoji Steel Products Co., Ltd., Zhejiang JFE Shoji Steel
Products Co., Ltd., Jiangsu JFE Shoji Steel Products Co., Ltd., JFE Shoji Steel Philippines, Inc., Central Metals (Thailand)Ltd., Steel Alliance Service Center Co., Ltd., JFE Shoji Steel Vietnam Co., Ltd., JFE Shoji Steel Hai Phong Co., Ltd., JFE
Shoji Steel Malaysia Sdn. Bhd., PT. JFE Shoji Steel Indonesia, JFE Shoji Steel India Private Limited, Vest Inc., JFE Shoji
Steel de Mexico, S.A. de C.V.

Reference Guidelines
GRI Sustainability Reporting Standards 2016, 2018, 2019, and 2020
Ministry of the Environment (Japan): Environmental Reporting Guidelines 2018
Ministry of the Environment (Japan): Environmental Accounting Guidelines 2005
Final Report: Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)

Publication Date
Website: October 2021, PDF file: October 2021
(previous report: September 2020, next report: scheduled for September 2022)

JFE GROUP CSR REPORT 2021

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Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyRelated Reports
The following information is available at:https://www.jfe-holdings.co.jp/en/

Company Profile
Outline of the JFE Group, corporate governance, etc.

Investor Information
JFE Group business information, financial data, stock and rating information, etc.

JFE Group Report (Integrated Report)
Financial information including the JFE Group’s mid- to long-term business strategies, business performance,
management strategies and non-financial information, including CSR activities, corporate governance, etc.

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IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline Content Indices
GRI Standard Content Index
This report is prepared with reference to the GRI Sustainability Reporting Standards 2016/2018/2019/2020
Note: We refer to JFE GROUP REPORT 2021 (Integrated Report), Securities Report from April 1, 2020 to March 31,2021) and Corporate Governance Report as of June 25, 2021.

■ GRI 102: General Disclosures 2016
Pages

Disclosure

ReportOther

1. Organizational profile
102-1

Name of the organization

—

102-2

Activities, brands, products, andservices—

102-3

Location of headquarters

—

102-4

Location of operations

—

102-5

Ownership and legal form—

Overview of JFE Holdings(https://www.jfe-holdings.co.jp/en/company/info/index.html)

JFE GROUP REPORT(Integrated Report): pp.35-38
Overview of JFE Holdings(https://www.jfe-holdings.co.jp/en/company/info/index.html)

A bout JFE Group(https://www.jfe-holdings.co.jp/en/company/g-about/index.html)

Overview of JFE Holdings(https://www.jfe-holdings.co.jp/en/company/info/index.html)

Overview of JFE Holdings
102-6Markets served—(https://www.jfe-holdings.co.jp/en/company/info/index.html)

About JFE Group(https://www.jfe-holdings.co.jp/en/company/g-about/index.html)

102-7

Scale of the organization

Social Data (P.220)

JFE GROUP REPORT(Integrated Report): pp.13-14,
pp.27-28, pp.39-49, pp.91-92,
pp.98

102-8

Information on employees andother workers

Social Data (P.220)

JFE GROUP REPORT(Integrated Report): pp.98

102-9

Supply chain

JFE Group Value Chain (P.32)

102-10Significant changes to theorganization and its supply chain

Not applicable——Environmental Management(P.49)

102-11

Precautionary Principle or approach

Scenario Analysis in Line with
the TCFD Recommendations(P.77)

Risk Management (P.193)

JFE GROUP CSR REPORT 2021

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IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyPages

Disclosure

ReportOther—

102-12External initiatives

Steel Industry Initiatives (P.90)
Biodiversity (P.125)
Human Rights (P.160)
Community (P.166)

102-13

Membership of associations

Steel Industry Initiatives (P.90)—

Message from the CEO (P.1)—

2. Strategy
102-14102-15

Statement from senior decisionmakerMessage from the CEO (P.1)
JFE Group Value Chain (P.32)
M aterial Issues of Corporate
Management(Materiality)

Key impacts, risks, andopportunities(P.16)—

S cenario Analysis in Line with
the TCFD Recommendations(P.77)

3. Ethics and integrity
102-16

Values, principles, standards, andnorms of behavior

Corporate Vision/BusinessConduct (P.4)

102-17

Mechanisms for advice andconcerns about ethics

Compliance (P.189)—
JFE GROUP REPORT(Integrated Report): pp.83

4. Governance102-18Governance structureCorporate Governance (P.178)—

102-19Delegating authority

CSR Structure (P.26)—

102-20Executive-level responsibility foreconomic, environmental, andsocial topics

CSR Structure (P.26)—

102-21

Consulting stakeholders on
economic, environmental, andsocial topics

CSR Structure (P.26)
Compliance (P.189)—

102-22Composition of the highest
governance body and its
committeesC orporate Governance (P.178)

JFE GROUP REPORT(Integrated Report): pp.87-88,
pp.78-80, pp.89-90

102-23Chair of the highest governancebody—

Corporate Governance Report:
pp.8

102-24

Nominating and selecting thehighest governance bodyCorporate Governance (P.178)

JFE GROUP REPORT(Integrated Report): pp.78-80

102-25

Conflicts of interest

Corporate Governance (P.178)

Corporate Governance Report:
pp.2

102-26

Role of highest governance bodyin setting purpose, values, andstrategy——102-27

Collective knowledge of highest
governance body——102-28

Evaluating the highest governancebody’s performanceCorporate Governance (P.178)—

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SocialGovernance

External
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ESG Data

Editorial
PolicyPages

Disclosure

ReportOther

Identifying and managing
economic, environmental, andsocial impacts

CSR Structure (P.26)
Environmental Management—102-30Effectiveness of risk management
processes

Risk Management (P.193)—

102-31

Review of economic,
environmental, and social topics

CSR Structure (P.26)—

102-32Highest governance body’s role insustainability reportingCSR Structure (P.26)—

102-33

Communicating critical concerns

Compliance (P.189)—

102-34Nature and total number of criticalconcerns

Compliance (P.189)—

102-35

Remuneration policiesC orporate Governance (P.178)

JFE GROUP REPORT(Integrated Report): pp.82

102-36

Process for determining
remuneration

Corporate Governance (P.178)

JFE GROUP REPORT(Integrated Report): pp.82

102-37

Stakeholders’ involvement inremuneration——

102-38Annual total compensation ratio——

102-39Percentage increase in annual totalcompensation ratio——

102-29

(P.49)

5. Stakeholder engagement
CSR Structure (P.26)

102-40

List of stakeholder groups

102-41

Collective bargaining agreements——

102-42

Identifying and selecting
stakeholders——

102-43

Approach to stakeholder
engagement

CSR Structure (P.26)—

102-44

Key topics and concerns raised

Third-part Comments (P.240)——

6.Reporting practice102-45

Entities included in the
consolidated financial statements

E ditorial Policy (P.243)—

102-46

Defining report content and topic
Boundaries

Editorial Policy (P.243)—

102-47

List of material topics

Material Issues of Corporate
Management(Materiality)—(P.16)

102-48

Restatements of information

Climate Change (P.55)
Environmental Data (P.198)—

102-49Changes in reportingEditorial Policy (P.243)—

102-50

Reporting period

Editorial Policy (P.243)—

102-51

Date of most recent reportE ditorial Policy (P.243)—

102-52

Reporting cycle

Editorial Policy (P.243)—

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VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

Editorial
PolicyPages

Disclosure102-53

ESG Data

ReportOtherSubmit Comments on the JFEGroup CSR Report (Japanese
Only)

Contact point for questions
regarding the reportContact Us(https://www.jfe-holdings.co.jp/en/
contact.html)(https://www.jfe-holdings.co.jp/csr/pdf/
form_er2021j.html)

102-54Claims of reporting in accordancewith the GRI Standards

Reference—

102-55

GRI content index

This table—

102-56External assuranceIndependent AssuranceStatement (P.231)—■ GRI103：Management Approach 2016
Pages

Disclosure

ReportOther

Material Issues of Corporate
Management(Materiality)—

GRI- 103: Management Approach
103-1

103-2

Explanation of the material topic
and its Boundary
The management approach and its
components(P.16)

Material Issues of Corporate
Management(Materiality)(P.16)

CSR Structure (P.26)
Supply Chain Management(P.46)

Environmental Management(P.49)

Climate Change (P.55)
Scenario Analysis in Line with
the TCFD Recommendations(P.77)

103-3

Evaluation of the management
approachPrevention of Pollution (P.120)
Efficient Use of Resources(P.113)

Water Security (P.117)
Biodiversity (P.125)
Responsibility to Customers(Provide Quality Products andEnhance Customer Satisfaction)(P.131)

Occupational Health and Safety(P.138)

Labor Standards (Recruitand Nurture Diverse Human
Resources) (P.148)

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JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
Policy■ GRI200: Economic topics
Pages

Disclosure

ReportOther

GRI- 201: Economic Performance 2016
Environmental Management

Securities Report: pp.2-3 (Transitionof Key Management Indicators,etc.), pp.14 (Status of Employees),
pp.51 (Dividend Policy), pp.85(Consolidated Income Statement)

201-1

Direct economic value generated
and distributed

201-2

Financial implications and otherrisks and opportunities due toclimate change

201-3

Defined benefit plan obligations
and other retirement plans

—

201-4

Financial assistance received fromgovernment——(P.49)

Community (P.166)
Scenario Analysis inLine with the TCFD
Recommendations(P.77)
Environmental Management (P.49)—
Securities Report:
pp.126 (Postemployment
benefits)

GRI- 202: Market Presence 2016
202-1

Ratios of standard entry level wage by
gender compared to local minimum wage

—

—

202-2

Proportion of senior management
hired from the local community——

GRI- 203: Indirect Economic Impacts 2016
203-1

Infrastructure investments andservices supported

203-2

Significant indirect economic
impacts

Environmental Management(P.49)—

Message from the CEO (P.1)
JFE Group Value Chain (P.32)
Material Issues of Corporate
Management(Materiality) (P.16)—

Community (P.166)

GRI- 204: Procurement Practices 2016
204-1

Proportion of spending on local
suppliers

—

—

—

—

GRI- 205: Anti-corruption 2016
205-1

Operations assessed for risks
related to corruption

205-2

Communication and training aboutanti-corruption policies and procedures

205-3

Confirmed incidents of corruption
and actions taken

Compliance (P.189)

—

—

—

—

—

GRI-206： Anti-competitive Behavior 2016
206-1

Legal actions for anti-competitive behavior,anti-trust, and monopoly practices

GRI-207： Tax 2019
207-1

Approach to tax

Tax Trancparency (P.197)

—

207-2

Tax governance, control, and risk
management

—

—

207-3

Stakeholder engagement andmanagement of concerns related to tax

—

—

207-4

Country-by-country reporting——

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SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
Policy■ GRI300: Environmental topics
Pages

Disclosure

ReportOther

Environmental Data (P.198)—

GRI-301:Materials 2016
301-1

Materials used by weight orvolume301-2

Recycled input materials

301-3

Reclaimed products and theirpackagingEfficient Use of Resources(P.113)

Environmental Data (P.198)
Efficient Use of Resources—(P.113)—

Climate Change (P.55)
Environmental Data (P.198)

—

—

—

Environmental Data (P.198)

GRI-302:Energy 2016
302-1

Energy consumption within

302-2

Energy consumption outside of theorganization

302-3

Energy intensity

Climate Change (P.55)
Environmental Data (P.198)

—

302-4

Reduction of energy consumption

Climate Change (P.55)
Environmental Data (P.198)

—

302-5

Reductions in energy requirements
of products and services

Steel Industry Initiatives (P.90)—

GRI-303: Water and Effluents 2018
303-1

Interactions with water as a sharedresources

Water Security (P.117)

—

303-2

Management of water dischargerelated impacts

Prevention of Pollution (P.120)
Environmental Data (P.198)

—

303-3

Water withdrawal

Water Security (P.117)
Environmental Data (P.198)

—

303-4

Water discharge

Environmental Data (P.198)

—

303-5

Water consumptionWater Security (P.117)
Environmental Data (P.198)

—

—

—

GRI- 304: Biodiversity 2016

304-1

Operational sites owned, leased,managed in, or adjacent to,protected areas and areas of highbiodiversity value outside
protected areas

304-2

Significant impacts ofactivities, products, andservices on biodiversity

304-3

Habitats protected or restored

—

—

304-4

IUCN Red List species andnational conservation list species
with habitats in areas affected byoperations——

Biodiversity (P.125)

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Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyPages

Disclosure

ReportOther

GRI-305: Emissions 2016
305-1

Direct (Scope 1) GHG emissions

Climate Change (P.55)
Environmental Data (P.198)

—

305-2

Energy indirect (Scope 2) GHG
emissionsC limate Change (P.55)
E nvironmental Data (P.198)

—

305-3

Other indirect (Scope 3) GHG
emissionsClimate Change (P.55)
Environmental Data (P.198)

—

305-4

GHG emissions intensity

Climate Change (P.55)
Environmental Data (P.198)

—

305-5

Reduction of GHG emissions

Climate Change (P.55)
Environmental Data (P.198)

—

305-6

Emissions of ozone-depleting
substances (ODS)

—

—

305-7

Nitrogen oxides (NOx), sulfur
oxides (SOx), and other significant
air emissions

Prevention of Pollution (P.120)
Environmental Data (P.198)—

Environmental Data (P.198)—

GRI 306: Waste 2020
306-1

Waste generation and significant
waste-related impacts

306-2Management of significant wasterelated impacts

306-3

Waste generated

306-4

Waste diverted from disposal

306-5

Waste directed to disposalE fficient Use of Resources(P.113)E nvironmental Data (P.198)
Efficient Use of Resources(P.113)

Environmental Data (P.198)
Efficient Use of Resources(P.113)

Environmental Data (P.198)
Efficient Use of Resources(P.113)

Environmental Data (P.198)

—

—

—

—

GRI-307: Environmental Compliance 2016
307-1

Non-compliance withenvironmental laws and regulations

Environmental Management(P.49)—

GRI- 308: : Supplier Environmental Assessment 2016308-1

New suppliers that were screenedusing environmental criteria

—

—

308-2

Negative environmental impacts inthe supply chain and actions taken——

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Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
Policy■ GRI400: Social topics
Pages

Disclosure

ReportOther

Labor Standards (Recruitand Nurture Diverse Human
Resources) (P.148)
Social Data (P.220)

—

—

—

GRI- 401: Employment 2016

401-1

New employee hires andemployee turnover

401-2

Benefits provided to full-time
employees that are not provided totemporary or part-time employees

401-3

Parental leaveS ocial Data (P.220)—

GRI- 402: Labor/Management Relations 2016
402-1

Minimum notice periods regarding
operational changes

—

—

—

GRI- 403: Occupational Health and Safety 2018403-1

Occupational health and safety
management system

Occupational Health and Safety

403-2

Hazard identification, risk assessment,
and incident investigation

Occupational Health and Safety403-3

Occupational health services

403-4

Worker participation, consultation,and communication on occupational
health and safetyOccupational Health and Safety

403-5

Worker training on occupational
health and safetyOccupational Health and Safety

403-6

Promotion of worker health403-7

Prevention and mitigation ofoccupational health and safety
impacts directly linked by business
relationships

403-8

Workers covered by an
occupational health and safety
management system

403-9Work-related injuries

Social Data (P.220)—

403-10Work-related ill healthO ccupational Health and Safety—(P.138)(P.138)

Occupational Health and Safety(P.138)(P.138)(P.138)

Occupational Health and Safety(P.138)

Occupational Health and Safety(P.138)—(P.138)

—
—
—
—
—

—

—

GRI-404: Training and Education 2016
404-1

Average hours of training per year
per employee

—

—

404-2

Programs for upgrading employee
skills and transition assistanceprograms

L abor Standards (Recruitand Nurture Diverse Human
Resources) (P.148)

—

404-3

Percentage of employees receiving
regular performance and careerdevelopment reviews——

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and Awards

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PolicyPages

Disclosure

Report

Other

405-1

Diversity of governance bodies andemployees

Labor Standards (Recruitand Nurture Diverse Human
Resources) (P.148)
Social Data (P.220)

—

405-2

Ratio of basic salary andremuneration of women to men

—

—

—

—

GRI-405: Diversity and Equal Opportunity 2016

GRI- 406: Non-discrimination 2016406-1

Incidents of discrimination andcorrective actions taken

GRI- 407: Freedom of Association and Collective Bargaining 2016
407-1

Operations and suppliers in which
the right to freedom of associationand collective bargaining may be at
risk

—

—

—

—

—

—

—

—

—

—

—

—

GRI- 408: Child Labor 2016
408-1

Operations and suppliers at significant
risk for incidents of child labor

GRI- 409: : Forced or Compulsory Labor 2016409-1

Operations and suppliers at
significant risk for incidents offorced or compulsory labor

GRI- 410: : Security Practices 2016
410-1

Security personnel trainedin human rights policies orprocedures

GRI- 411: Rights of Indigenous Peoples 2016
411-1

Incidents of violations involving
rights of indigenous peoples

GRI-412: Human Rights Assessment 2016
412-1

Operations that have been subject
to human rights reviews or impact
assessments

412-2

Employee training on human rights
policies or procedures

412-3

Significant investment agreements
and contracts that include humanrights clauses or that underwent
human rights screening

Human Rights (P.160)

—

—

—

GRI- 413: Local Communities 2016413-1

Operations with local community
engagement, impact assessments,
and development programs

413-2

Operations with significant actualand potential negative impacts on
local communities

Community (P.166)

Not applicable

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ESG Data

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and Awards

Editorial
PolicyPages

Disclosure

Report

Other

—

—

JFE Group Value Chain (P.32)

—

—

—

GRI- 414: : Supplier Social Assessment 2016414-1

New suppliers that were screenedusing social criteria

414-2

Negative social impacts in the
supply chain and actions taken

GRI- 415: Public Policy 2016
415-1

Political contributions

GRI- 416: Customer Health and Safety 2016

416-1

416-2

R
 esponsibility to Customers(Provide Quality Products andEnhance Customer Satisfaction)

Assessment of the health andsafety impacts of product andservice categories—(P.148)

Incidents of non-complianceconcerning the health and safety
impacts of products and services

—

—

—

—

GRI- 417: Marketing and Labeling 2016
417-1

Requirements for product andservice information and labeling

417-2

Incidents of non-complianceconcerning product and service
information and labeling

417-3

Incidents of non-complianceconcerning marketing
communications

Not applicable

—

—

—

—

—

—

—

GRI-418: Customer Privacy 2016
418-1

Substantiated complaints
concerning breaches of customer
privacy and losses of customer
data

GRI-419: Socioeconomic Compliance 2016
419-1

Non-compliance with laws andregulations in the social andeconomic area

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VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyComparison with Environmental Reporting Guidelines 2018 (Ministry of the Environment, Japan)
Chapter 1: Basic Information of Environmental Reporting
Items

Contents

1. Basic requirements for environmental reporting(1) BoundaryEditorial Policy (P.243)(2) Reporting period

Editorial Policy (P.243)(3) Reporting standards and guidelinesEditorial Policy (P.243)
Guideline Content Indices (P.247)(4) Overview of the environmental reportE ditorial Policy (P.243)

2. Trends in key performance indicators
Material Issues of Corporate
Management(Materiality) (P.16)(1) Trends in major performance indicators

Chapter 2: Items to Be Included in Environmental Reporting
Items

Contents

1. Top Management Commitments(1) Top management commitments to
the JFE Group’s response to material environmental issues

Message from the CEO (P.1)

2. Governance(1) JFE Group governance structure

CSR Structure (P.26)(2) Manager responsible for material environmental issues

Environmental Management (P.49)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(3) Roles of the board of directors and board of executive officers
in the management of material environmental issues

Environmental Management (P.49)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)

3. Stakeholder Engagement(1) Corporate policies to stakeholders

Environmental Management (P.49)(2) Overview of stakeholder engagement activities conducted in
the reporting period

JFE Group Value Chain (P.32)
Environmental Communication (P.129)
CSR Structure (P.26)

4. Risk Management(1) Environment-related risk identification, assessment, andmanagement processes

CSR Structure (P.26)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)
Risk Management (P.193)(2) Positioning of the above processes in the JFE Group’s overallrisk management

CSR Structure (P.26)
Risk Management (P.193)

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VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyChapter 2: Items to Be Included in Environmental Reporting
Items

Contents

5. Business ModelJFE Group Value Chain (P.32)
JFE GROUP REPORT(Integrated Report): pp.35-38(1) JFE Group business model
6. Value Chain Management(1) Value chain overview

JFE Group Value Chain (P.32)(2) Green procurement policy, objectives, and resultsS upply Chain Management (P.46)(3) Status of eco-friendly products and services

Development and Provision of Eco-friendly
Processes and Products (P.94)

7. Long-term Vision(1) Long-term visionMessage from the CEO (P.1)
Climate Change (P.55)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(2) Time period covered by the long-term visionM essage from the CEO (P.1)
C limate Change (P.55)
S cenario Analysis in Line with the TCFD
Recommendations (P.77)(3) Reasons why that time period was selectedClimate Change (P.55)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)

8. Strategy
Message from the CEO (P.1)
Material Issues of Corporate
Management(Materiality) (P.16)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)
Steel Industry Initiatives (P.90)(1) JFE Group business strategy for contributing to theachievement of a sustainable society

9. Methodology for Identifying Material Environmental Issues(1) Procedure by which the JFE Group identified its material
environmental issues

Material Issues of Corporate
Management(Materiality) (P.16)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(2) List of identified material environmental issues

Material Issues of Corporate
Management(Materiality) (P.16)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(3) Reasons that the identified environmental issues were judged
material

Material Issues of Corporate
Management(Materiality) (P.16)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(4) Boundaries of the material environmental issues

J FE Group Value Chain (P.32)
M aterial Issues of Corporate
Management(Materiality) (P.16)
S cenario Analysis in Line with the TCFD
Recommendations (P.77)

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VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyChapter 2: Items to Be Included in Environmental Reporting
Items

Contents

10. JFE Group Material Environmental Issues(1) Policies and/or action plansCorporate Vision/Business Conduct (P.4)
JFE Group Value Chain (P.32)
Material Issues of Corporate
Management(Materiality) (P.16)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)(2) Targets and results of policies/action plans based on
performance indicators

Material Issues of Corporate
Management(Materiality) (P.16)
CSR Structure (P.26)(3) Methodologies used for calculating each performance indicatorM aterial Issues of Corporate
Management(Materiality) (P.16)(4) Aggregation scope of data for each performance indicator

Material Issues of Corporate
Management(Materiality) (P.16)
Editorial Policy (P.243)(5) Financial impact of risks and opportunities, and calculation
methodologies if the financial impact is significant

Environmental Management (P.49)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)
Environmental Data (P.198)

6) Assurance report by an independent third partyIndependent Assurance Statement (P.231)

Reference: Major Environmental Issues and Their Performance Indicators
Items

Contents

1. Climate Change
Greenhouse Gas Emissions(1) Scope 1 emissions

Climate Change (P.55)
Environmental Data (P.198)(2) Scope 2 emissionsC limate Change (P.55)
E nvironmental Data (P.198)(3) Scope 3 emissions

Climate Change (P.55)
Environmental Data (P.198)

Emission Intensity
Climate Change (P.55)
Environmental Data (P.198)(1) Greenhouse gas emission intensity
Energy Usage(1) Breakdown of energy usage and overall energy usage

Climate Change (P.55)
Environmental Data (P.198)(2) Renewable energy usage as a percentage of overall energy
usage

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Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyReference: Major Environmental Issues and Their Performance Indicators
Items

Contents

2. Water ResourcesW ater Security (P.117)
E nvironmental Data (P.198)(1) Water resource inputs(2) Water intensity—(3) Water discharge

Environmental Data (P.198)(4) Status of water stress, if the entity has sites or supply chainslocated in areas with water stressWater Security (P.117)

3. Biodiversity(1) Impact of business activities on biodiversity

Biodiversity (P.125)(2) Status and extent of the dependency of the JFE Group’sbusiness activities on biodiversity

Biodiversity (P.125)(3) Business activities that contribute to biodiversity conservation

Biodiversity (P.125)(4) Status of cooperation with external stakeholdersB iodiversity (P.125)

4. Resource Circulation
Resource Inputs(1) Volume of nonrenewable resource inputs

Environmental Data (P.198)(2) Volume of renewable resource inputs

E nvironmental Data (P.198)(3) Volume of recycled materials used

Environmental Data (P.198)(4) Rate of recycled and reused resources (= volume of recycledmaterials used/volume of resource inputs)

Efficient Use of Resources (P.113)
Environmental Data (P.198)

Resource Waste(1) Total production of wasteE fficient Use of Resources (P.113)
E nvironmental Data (P.198)(2) Total final disposal volume of waste

Efficient Use of Resources (P.113)
Environmental Data (P.198)

5. Chemical Substances(1) Volume of chemical substances in storage—(2) Volume of chemical substance emissionsP revention of Pollution (P.120)
E nvironmental Data (P.198)(3) Volume of chemical substances transferredPrevention of Pollution (P.120)
Environmental Data (P.198)(4) Volume of chemical substances handled (volume used)—

6. Pollution prevention
GeneralEnvironmental Management (P.49)(1) Status of legal complianceAir quality conservation(1) Air-pollutant emissions volume, emission concentration in air
pollution regulations

 revention of Pollution (P.120)
PEnvironmental Data (P.198)

Water pollution(1) Water pollution load, emission concentration in emissions
regulations

 revention of Pollution (P.120)
PEnvironmental Data (P.198)

Soil pollution
Environmental Management (P.49)(1) Status of soil pollution

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Guideline
IndicesMessage fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyTCFD Content Index
Recommended
Disclosures【Governance】
Disclose theorganization’s
governance aroundclimaterelated risks andopportunities.

【Strategy】
Disclose the actual andpotential impacts ofclimate-related risks
and opportunities on
the organization’s
businesses, strategy andfinancial planning wheresuch information ismaterial.

【Risk Management】
Disclose how theorganization identifies,
assesses, and manages
climate-related risks.

【Metrics and Targets】
Disclose the metrics andtargets used to assess
and manage relevant
climate-related risks andopportunities.

Overview of TCFD Recommendationsa. D
 escribe the board’s oversight ofclimate-related risks and opportunitiesb. Describe management’s role inassessing and managing climate-relatedrisks and opportunities
a. D
 escribe the climate-related risks andopportunities the organization has
identified over the short, medium, andlong termb. Describe the impact of climaterelated risks and opportunities on theorganization’s businesses, strategy, andfinancial planningc. D
 escribe the resilience of theorganization’s strategy, taking into
consideration different climate-related
scenarios, including a 2°C or lower
scenarioContentsC orporate Governance (P.178)
R isk Management (P.193)
C limate Change (Governance) (P.59)

Seventh Medium-term Business Plan
(Major Strategies of the Seventh Mediumterm Business Plan) (P.13)
JFE Group Value Chain (P.32)
Climate Change (JFE Group Environmental
Vision for 2050) (P.56)
Climate Change (JFE Group’s Climate
Change Strategy) (P.61)
Scenario Analysis in Line with the TCFD
Recommendations (P.77)

a. D
 escribe the organization’s processes
for identifying and assessing climaterelated risksb. Describe the organization’s processes
for managing climate-related risksc. D
 escribe how processes for identifying,assessing and managing climaterelated risks are integrated into theorganization’s overall risk management

Risk Management (P.193)
Environmental Management (P.49)
Climate Change (Risk Management) (P.70)

a. D
 isclose the metrics used by theorganization to assess climate-relatedrisks and opportunities in line with its
strategy and risk management process

Seventh Medium-term Business Plan
(Major Strategies of the Seventh Mediumterm Business Plan) (P.13)
Material Issues of Corporate
Management(Materiality) (P.16)
Climate Change (Metrics and Targets) (P.71)

b. Disclose Scopes 1 and 2 and, if
appropriate, Scope 3 greenhouse gas(GHG) emissions and related risks

Climate Change (Metrics and Targets) (P.71)
Environmental Data (P.198)

c. D
 escribe the targets used by theorganization to manage climate-relatedrisks and opportunities and performanceagainst targets

M aterial Issues of Corporate
Management(Materiality) (P.16)
C limate Change (JFE Group Environmental
Vision for 2050) (P.56)
C limate Change (Metrics and Targets) (P.71)

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Guideline
Indices