Integrated
ReportA Hundred Years of History
Passed down for more than a century,
the DNA of innovation

Nippon Fine Chemical offers raw materials for pharmaceuticals,
functional materials used in electronic materials
and performance resins, and hygiene management materials,
as well as raw materials for cosmetics used in products ranging
from skin care to makeup and hair care.
We shall continue to hold contributing to a prosperous
and ﬂourishing society and to happy lives through chemistry
as our Management Philosophy.

CONTENTS
Top Message
Top Message

03

Management Storategy
Value Creation Story

07

Medium-term Management Plan09

Our Oﬃcers

11

Corporate Governance

12

Business Content
History of Nippon Fine Chemical

13

Nippon Fine Chemical Group Businesses

15

Functional Products: Beauty Care Field

17

Functional Products: Health Care Field

19

Functional Products: Fine Chemicals Field

21

Focus Material: Phospholipids

23

Focus Material: Lanolin and Cholesterol

24

Sustainability
Sustainability Philosophies and Framework

25

Materialities

27

Respect for Human Rights

29

Environmental Preservation

31

Environmentally-Friendly Product Development 35
Compliance and Labor Environment

37

Financial Data
Outline of Consolidated Financials Over the Last Decade 39

Company Name
EstablishedURL

NIPPON FINE CHEMICAL CO., LTD.

Financial Statements

41

February 1918
https://www.nipponseika.co.jp/en/

Non-ﬁnancial Data

5,933.22 million yen

Human Resources Information

45

Number of Employees

398 (as of June 23, 2023)

Safety and Environment Information

47

Listed stock exchange

Prime Market of the TSE (as of April 4, 2022)

Paid in Capital

Representative Director, President

Hiroshi Yano

*Please see our website for the latest information.

■ Top Message
Reaching our centennial,
strengthening governancewith a view to future dramatic growth

Top Message

Towards ESG Management by Putting
Our Management Philosophy into PracticeThis is a general overview of our medium-term management
plan for the ﬁve years from April 2018 to March 2023.

We were founded in 1918 as Nippon Camphor Co., Ltd. in order
to integrate the camphor businesses in Japan.

We celebrate the centennial of our founding on February 12,
2018. The medium-term management plan which started in April
that year (the ﬁve years from FY2018 to FY2022) positioned，

fat-related products, and expanded our business lines by forging“Strengthening governance stage” under the slogan “To be aour own unique ﬁelds within chemistry. In 1971, we changed our

corporate group growing sustainably for the next hundred years,”

named to Nippon Fine Chemical Co., Ltd., and have been working

and we carried out a range of measures for this. We achieved

to develop products and businesses that stay ahead of peopleʼslisting on the TSE Prime Market in April 2022, and in tandem withneeds as a ﬁne chemicals manufacturer.

this, we are working towards thorough responses to our Corporate

Today, we offer products in a wide range of ﬁelds. We makecosmetic ingredients that are kind to both people and theManagement Storategy

Later, we started manufacturing fatty acids and other oil andGovernance Code.
In these ﬁve years, we have pursued the following threemeasures.

improving everyoneʼs QOL (Quality of Life), hygiene management- Formulating NFC VISION 2030

products that make everyoneʼs environments clean, safe, and- Dealing with sustainability

comfortable, and functional products used not just in day-to-day- Revising our business portfolio

goods but in electronics and different types of resins.
We hold the following three points as our Management Philosophy.
- Nippon Fine Chemical shall contribute to society through chemistry- Nippon Fine Chemical shall contribute to all people connected- Nippon Fine Chemical shall contribute to the self-realization of
our employees

making our customers happy. I want to bring more smiles to the

When I was appointed President in June 2020, I offered thematerials suppliers. That is the hope contained within “Smiles

following ﬁve key items as necessary to achieve sustainable

employees of our Group, their families, our clients, and raw
on Faces: The Power of KIREI.”

growth for our new hundred years.
(1) Compliance and safety

Based on this Management Philosophy, we shall aim to become

people of the world with the power of KIREI, starting with the(2) Human resources training and working style reforms

a corporation that continues to deliver value to society through(3) Formulating a long-term visionunceasing innovation, actively responding to the changing times.

(4) Multiplying our core businesses(5) Promoting digitalization
believe there needs to be a common theme running through eachbusiness. Also, the environment for our businesses is changing
ever faster, becoming more difﬁcult. I believe it is important for
all employees to share the issues of “What do we want to be in
the future? What do we need to do to get there?” in order to see

To support sustainability, we added three sub-concepts to
NFC VISION 2030:(1) Sustaining the KIREI of the Earth through sustainable
manufacturing,(2) Susutaining the KIREI of commuities through compliance,
safty, and actions that ensure peace of mind, and(3) Sustaining the KIREI of the future through diversity -deriven
innovation.

changes in the environment, survive and thrive in a world which

This shows our strong desire to contribute to ESG management

remains unpredictable. This is why we have worked on preparing

and achieving the SDGs.

H i r oshi Yano

03

Faces: The Power of KIREI.”

Our Management Philosophy of "Contributing to Society

In our businesses, we provide raw materials for cosmetics toThrough Chemistry" as well as the "Smiles on Faces: The Powerhelp you keep your skin and hair beautiful (KIREI), raw materials

of KIREI" in NFC VISION 2030, and our sub-concept of helping

for pharmaceuticals to keep you healthy (KIREI), and functional

to sustain the three "KIREIs" of the Earth, society, and thematerials to make the future global environment clean (KIREI).

future, form the basis of our Basic Sustainability Policy, which

We experience the feeling of KIREI in many different ways,

aims for both a sustainable society and sustained growth for us.

Non-financial Dataa long-term vision, formulating the NFC VISION 2030 “Smiles on

Representative Director, President

Financial Data

Our businesses vary by ﬁeld, but to ensure further growth, I

ESG management andSDGs contributions

Sustainability

with our company

Depicting our future image,what we need to do now:
formulating NFC VISION 2030

Business Content

environment, pharmaceutical ingredients that contribute to04

At the same time, we have been revising our business portfolio

terms of capital investment, there was a slight lag due to issues
such as the fact that some facilities did not start operating until
April 2023, but it went largely as planned.
In addition, if we turn our eyes to capitalization strategy, we
have worked to improve and stabilize dividend levels while

We have set phospholipids as a strategy product, as we can

For our Lipid Division (phospholipids for pharmaceutical products)

working out a balance between capital efﬁciency and ﬁnancial

look forward to enjoying market competitiveness thanks to our

within our Fine Chemicals ﬁeld, in the Industrial Products Businesssolvency. We have been using DOE (the consolidated dividend

proprietary technology. We are working on expanding sales withover the last ﬁve years with an eye to sustainable growth.

on equity ratio) as our dividends policy since FY2021, which has

the goal being to have people say “when it comes to phospholipids,

meant a large increase in dividend levels, and increases for six

look no further than Nippon Fine Chemical.” We are working to help

the business ﬁeld, and made the Lipid Division independent of theﬁscal years running in tandem with the previous medium-term

the general public get a better understanding, with a special

Fine Chemicals Business Division through organizational reform,

management plan. In addition, we have also been working tosection on our website that opened in January 2023.

establishing a system for strengthening our business activities.

curtail our cross-shareholdings and reduce our equity, as welldecision to withdraw from the leather oils business, with its highas buying back our own shares, which, along with improved
performance, have increased our share price.

environmental impact and difﬁcult business environment, and so
we sold off our Chinese subsidiary, Taicang Nikka Fine ChemicalCo., Ltd.
our strengths, and the elimination of businesses which do notmesh with the perspectives of ESG management, have boosted
the strength of our business foundation as we head to the future.

As quantitative targets, we set sales of 39 billion yen andIn the ﬁeld of beauty care, in addition to the Chinese market,
which we have focused our efforts on since the previous

Our new medium-term management
plan is the “Attack stage”

medium-term management plan, we are also focusing on

As of April 2023, we have started a new Medium-term management

phospholipids for cosmetics, as we expect there will be evenplan, which will run for four years from FY2023 to FY2026).

expanding sales in the North American and European markets,
our main markets. We are planning to construct a new plant for
further growth in demand.

At the same time, we shall focus on key development themesthat contribute to a sustainable society from the perspective ofAs we head towards the realization of NFC VISION 2030, we

In the health care ﬁeld, we are strengthening our phospholipids

are positioning these four years as the stage for actively investingfor nucleic acid medicines, where growth is particularly expected,

Speciﬁcally, we shall move ahead with making our production

to strength our growth foundation, altering our course from thewithin the drug delivery systems ﬁeld. As we can respond to theprocesses sustainable in the phospholipids materials I discussed“Defense stage,” where we worked to strengthen corporate

trend towards horizontal segmentation that is happening in theearlier, and work to further differentiate ourselves from our rivals.

governance, to the “Attack stage.”pharmaceuticals industry, we will also focus on being a CDMO forSpeciﬁcally, we will work on the following, and further accelerate

sustainable growth for our company.

the development of pharmaceuticals. To that end, April 2023 we

In addition, we have set the development of materials for

set up a the new Shonan Laboratory at Shonan iPark in Fujisawa,

perovskite solar cells as a large-scale development theme.

operating proﬁt of 3.9 billion yen, along with a total capitalour growth strategy.

Kanagawa Prefecture.

Perovskite solar cells are a technology from Japan, and theirinvestment of 10 billion yen over ﬁve years, by the end of the- Strengthen our business portfolio through rebuilding ourIn this way, we are pursuing liaisons outside the company

primary feature is that they are lighter and more ﬂexible

through open innovation.

compared to conventional solar cells. Being thinner and easily

medium-term management plan in the ﬁscal year ended March
2023. Of these, we failed to reach our sales objective as a resultof sluggish sales for the Domestic Sales Department due to thebusiness segments- Strengthen R&D and sales so that people say “when it comesto phospholipids, look no further than Nippon Fine Chemical”- Strengthen our capital investment and R&D investment

proﬁt was considerably above our target, at 5.1 billion yen. In- Strengthen our responses to sustainability
Our Group changed our business segments as of FY2023.
Segments that were all previously collected under “industrial
products” have been reorganized as beauty care, health care, ﬁne

bendable, they should be able to be installed on walls or car

Aiming for our sustainable growth
and to bring about a sustainable
societyroofs or other places where normal solar cells would be hard to

We are focusing our efforts for our Basic Sustainability Policy

hope to contribute to a sustainable society by providing

on the following points.
First, we will actively work on the following for achieving achemicals, and trading as organized under the domestic sales

sustainable society.

department, and we are strengthening disclosure. In addition, we- For production processes, we will work on saving energy,

also changed our segment name from Industrial Products to
At the same time, we changed the Household Products name towould aim for early deployment within society to serve as a
trump card for achieving a carbon-neutral society by 2050. We
materials indispensable for perovskite solar cells to battery
manufacturers.
The chemicals industry is increasingly required to respond tosustainability for the future and co-existence with local- In developing new technologies, we shall study enzyme synthesis

communities. We shall put into practice our desire to aim for bothtechnology and ﬂow reactors which are continuous synthesis

a sustainable society and sustainable growth for us. This is not justEnvironmental Hygiene Products (hygiene ﬁeld) and made it- In raw materials procurement, we shall support various

revenue-based growth: we shall continue to tackle the challenge

Arbos-only. In addition to these, we hope to strengthen strategies

certiﬁcation systems such as RSPO and non-GMO

of aiming ever higher through repeated innovations into thesuited to each business ﬁeld by reorganizing the organizations ofThrough initiatives such as these, we aim to become a chemical

future, based on our Management Philosophy of “Contributing to

Nippon Fine Chemical on a functional department system basis,

manufacturer that is selected by people around the world as we

Society Through Chemistry,” while also fulﬁlling our responsibilities

moving ahead with business portfolio management.

move towards achieving a sustainable society.

as a member of society.

Non-financial Data

Functional Products.

reusing resources, and reducing waste

install. The Kishida administration just announced in April that it

Financial Data

impact of the novel coronavirus infections, but our operating

Sustainability

Revenue base strengthened,with dividend increases
for six ﬁscal years running

Phospholipids are products related mainly to the ﬁelds ofbeauty care and health care.

Business Content

In this way, active investment in businesses where we can use

Management Storategy

segment, we both made a large-scale investment totaling some 5.3
billion yen towards strengthening competitiveness and expanding

In the same way, for Fine Chemicals ﬁeld, we made the05

Smile on Faces;
The KIREI Power of the Phospholipids,
by Nippon Fine Chemical.

Top Message

Revising our business portfolio withan eye to sustainable growth06

■ Value Creation Story
Management Philosophy: Contributing to Society Through Chemistry
Basic Sustainability Policy: Aiming for our sustainable growth
and to bring about a sustainable society

day-to-day products but also in electronics and different types of resins.
We shall continue to be a corporation that contributes to creating a society that offers beautiful, healthy, and prosperous
lives, full of smiles, by providing functional, high added-value raw materials for cosmetics and pharmaceuticals, andfunctional raw materials.

KIREI for the Earth

Technology ﬁelds
NFC has strengths inSynthetic organic
chemistryBusiness ﬁelds

Beauty care

Sustain your skinand hair KIREI (Beauty)

Pharmaceuticals

Supporting your body
KIREI (Health)Electronics

Supporting cutting-edge
equipment KIREI(Performance)

Resources energy

Keeping resources
KIREI (Sustainable)

Environmental
hygieneKeeping the environment
KIREI (Clean)- Bioactive ingredients- Wool grease derivatives
for cosmetics

Polymer chemistry- DDS materials/development
and manufacturing support

Oleochemistry- Pharmaceutical intermediates- Pharmacology/safety testing- Prevention of workplace
accidents- Organic acid chlorides

Surface science
Fine chemicals- Materials for perovskite
solar cells- Functional Coatings- Additives for resins- Promotion of diversity

Dermatology- Handsoaps- Achieving a work-lifebalance- Development of productsthat co-exist with theenvironment- Hand sanitizers

HygieneNanotechnology

07- Products for public health- Products for food hygine- Products for medical
hygineKIREI“Kirei ” is a Japanese word expressing
the concept of “beautiful,” “ﬁne,”“clear,” or “clean,” and can be used
as an adjective, noun or verb.

Non-financial Data

Increasing the purity of our KIREI

Financial Data

- Wool grease derivatives

KIREI for the future

Sustainability- Wool grease derivatives
for pharmaceuticals- Strengthening compliance- Providing products that aresafe and reliable

Cosmetics- Natural polysaccharides

Health care
KIREI for society- Functional esters forcosmetics

Business Content- Prevention of global
warming

Provided values- Phospholipids for cosmetics- Measures to combat
climate change- Reduction of environmental
impactOutputs

Management Storategy

Social issues

Top Message

Nippon Fine Chemical offers raw materials in a variety of ﬁelds: for cosmetics that are kind to both people and theenvironment, for pharmaceuticals that help improve health and convenience, and for functional materials used not just in08

■ Medium-term Management Plan
Initiatives

We shall strengthen our growth base by active investment as we aim to reach where we want the company to be by 2030 aslaid out in our long-term vision, NFC VISION 2030.

- Strengthen our business portfolio through restructuring our business segments‐ Strengthen R&D and sales so that people say “when it comes to phospholipids, look no further than Nippon
Fine Chemical”- Strengthen our capital investment and R&D investment- Strengthen investment in technology development

We shall promote activities towards achieving oursuch as the creation of future core technologies

materialities and TCFD targets as we aim to realize

and making manufacturing activities sustainable

the ideals of “Aiming for our sustainable growth and‐ Development of an environment where employees

to bring about a sustainable society” in our BasicManagement Storategy- Strengthen our responses to sustainability

Strengthen responses to sustainability

Strengthen capital investment and R&D investment

Sustainability Policy.

can work easily (capital investment)- Promotion of digitalization (such as updating coresystems)

NFC VISION 2030 Long-term vision

Management targets and capital policies (consolidated)“Smiles on Faces: The Power of KIREI.” And, as
subconcepts, we acclaim the power of KIREI toDiversity&Inclusion

sustain the Earth, society, and the future, andEmployee
Engagement
Fearless
Organization

course of Environmental, Social, and Corporate
Governance (ESG) and, to ensure a sustainable
society, contribute to the attainment of sustainable

Marketing&Innovation

development goals (SDGs). Announced in OctoberSocialResponsibility

DigitalTransfor-mation

Smiles on Faces:
The Power of KIREI

2021.

■Revising our business portfolio (revising segmentation)
We have reorganized our segments based on business ﬁelds to strengthen our business strategy. The mainchanges are the change of name from the old Industrial Products segment to the new Functional Products
segment, and its subsequent ﬁner division into beauty care, health care, ﬁne chemicals, and trading.
■Setting strategic items (“Smile on Faces; The KIREI power of the Phospholipids, by Nippon Fine Chemical.”)
We have set phospholipids, a product made through our proprietary technology, as a strategic item (growth

We are continuing active investment to strengthen our growth base and also established indices that are awareof capital efficiency.
Actual figures for FY2022

Plan for FY2023

Goals for FY2026

Goals for FY2030

Net sales（billion yen）

36.8

38.0

41.0

50.0

Operating profit（billion yen）

5.0

4.8

5.7

7.7

EBITDA*1（billion yen）

6.0

6.1

7.7

11.1

ROIC*2

7.9％

‑

8.0％

9.0％

Capital investment‑

Sales-to-R&D ratio

2.4％

Total of 12 billion yen over four years
‑

2.7％

‑
‑

*1. EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization (Operating profit + Depreciation)*2. ROIC: Return On Invested Capital (After-tax operating profit ÷ (interest-bearing debt + equity))of our key segments.

Capital policies
We aim to enhance our returns to shareholders, including stable dividends and buying back our own shares.

Health care ﬁeld

- Expansion of sales of phospholipid materials for cosmetics
and development of a system to increase production(boosting capital investment)- Expansion of sales to overseas markets, especially the West
and China, where high growth is expected- Expanding sustainable products such as RSPO andnon-GMO*p17- Solid startup of production based on large-scale investment inphospholipids for pharmaceuticals‐ Expansion of business from being focused on small molecule
pharmaceuticals to areas such as nucleic acid pharmaceuticals
where high growth is expected- Focus on being a CDMO for the development of pharmaceuticals

Fine chemicals ﬁeld

Hygiene ﬁeld

- Reorganization of low-proﬁt products- Establishment of next-generation technologies(such as perovskite solar cell materials)- Listing of sustainable products on the market- Promotion of differentiation through development of highvalue-added products

Actual figures for FY2022

Plan for FY2023

Goals for FY2026

Goals for FY2030

DOE*3

3.0％

3.5％

3.5％

‑

Dividend per share

57 yen70 yen80 yen

100 yenTotal return ratio*4

79％

Average of at least 50%

Cross-shareholding ratio*5

25％‑

17% or less‑
10% or less

*3. DOE: consolidated Dividend On Equity ratio (Total annual dividends ÷ Consolidated net assets or Dividend payout ratio x ROE)
*4. Total return ratio: (Total amount of dividends + Amount of treasury stock acquisition) ÷ Net income attributable to parent company
shareholders*5. Cross-shareholding ratio: Ratio of total amount recorded on the balance sheet for investment stocks held for purposes other thanpure investment to consolidated net assets

Non-financial Data

09

Beauty care ﬁeld

Financial Data

driver), and aim to strengthen the growth bases both for phospholipids for pharmaceuticals (health care) andphospholipids for cosmetics (beauty care). On top of that, we are working on the following strategies in each

Sustainability

Revising our business portfolio and setting strategic items

Management target ﬁgures

Business Content

express our unshakeable intent to pursue theCommunity
Benefit

Top Message

Basic policy

10■ Our Oﬃcers■ Corporate GovernanceDirectors and Auditors (as of June 23, 2023)

value over the mid to long term, and for sustainable growth. We are working to construct a corporate governance systemand establish a sound, transparent, and highly effective management system, including meeting our management andexplanatory responsibilities towards our shareholders and other stakeholders.

Directors
April
1989 : Joined NFC
September 2006: General Manager of Planning Ofﬁce
June
2010 : Corporate Ofﬁcer
April
2011 : General Manager of Corporate Planning Ofﬁce
June2015 : Director
Senior General Manager of Fine Chemicals Department
April
2017 : General Manager of Lipid DivisionJune
2020 : Representative Director, President (to present)

Director, Chairman

Susumu Yano

Hiroshi Yano

1978 : Joined NFC
2000 : General Manager of Pharmaceutical Manufacturing
Department
November 2002 : General Manager of Pharmaceutical Plant
June
2003 : Corporate Ofﬁcer
Deputy Senior General Manager of Manufacturing &Technology Division and General Manager, Takasago Plant
June
2004 : Director, Senior General Manager of Manufacturing &Technology Division
June
2006 : Representative Director, President
March 2016 : Outside Director of Nichirin Co., Ltd. (to present)June2020 : Representative Director, Chairman
June2022 : Director, Chairman (to present)(Born April 19, 1955)(Born June 29, 1964)

Outline of the corporate governance system
Nippon Fine Chemical established an effective business execution
system. The introduced corporate ofﬁcer system separates theJune: 2003function. The decision-making process of the matters for which business

June: 2008execution decisions are delegated to representative directors and/or

June: 2010decision-making/supervisory function and the business executive

other directors/corporate ofﬁcers, is clariﬁed based on the regulations.
April
March
June
October

Director, Executive Corporate Ofﬁcer
Excutive Supervisor for Group Company
Production Management

Masanobu Kawabayashi(Born September 5, 1955)

March
June
June
April
June

Yukihiro Ohashi

Directors (Outside)

April
June

1975 : Joined Toray Industries, Inc.
2006 : Director at Toray Industries (Malaysia) Sdn. Bhd.
and President of Penﬁbre Sdn. Bhd.
June2013 : CEO & COO of Kansai TEK Co., Ltd.
(now Toray Engineering West Co.,Ltd.)
January 2015 : CEO & COO at Toray Engineering Co., Ltd.
June
2019 : Advisor at Toray EngineeringJune
2021 : Director at NFC (to present)June
2021 : Outside Audit & Supervisory Board Member,
YMC Co., Ltd. (to present)

Directors (Outside)

Chihiro Murase

As the highest decision-making organization for management, it determines matters related to laws and regulations andofﬁcers. In addition, the Management Meeting, made up of the Representative Director and other full-time directors andcorporate ofﬁcers, deliberates referrals to the Board of Directors of key matters relating to management planning andmanagement policy from multiple perspectives to ensure accurate decision-making.
the directors through investigations into the ﬁnancial status, work, and attendance at important meetings such as the Boardof Directors meetings based on the audit policies and audit plans determined by the Audit & Supervisory Board.
General Meeting of Shareholders
Appointment/Dismissal

Appointment/Dismissal
Nomination and Remuneration Committee
Audit

Board of Directors(Born October 29, 1945)

1982 : Joined NFC
2007 : General Manager of Environmental Safety &Quality Assurance Department
2017 : Standing Audit & Supervisory Board Member (to present)

Audit

Ethics Committee
Internal Control Committee
Company-wide Risk Management System Committee
Reporting

Sustainability CommitteeIntellectual Property Oversight Committee

Internal Audit Oﬃce
Audit

Standing Audit &Supervisory Board Member

Departments and Group companies

Masanori Mitsuki(Born January 20, 1958)

Audit & Supervisory Board
Member (Outside)

Kazufumi Suzuki(Born February 11, 1976)

April
1998 : Joined Nissho Iwai Corporation (now Sojitz Corporation)
October 2013 : Joined Taiyo Koko Co., Ltd. as General Manager of Research& Development Department
June2014 : Director of Taiyo Koko, and General Manager ofResearch & DevelopmentJune2015 : Executive Corporate Ofﬁcer of Taiyo Koko, andBranch Manager of Tokyo Ofﬁce and General Manager ofResearch & DevelopmentJune2015 : Outside Director of Toho Kinzoku Co., Ltd. (to present)June2017 : Vice-President and Director of Taiyo Koko
June
2018 : Representative Director and President of Taiyo Koko
(to present)
March 2019 : Outside Director of Nichirin Co., Ltd. (to present)June
2021 : Audit & Supervisory Board Member at NFC (to present)

Content done in FY2022
Highlights of governance from FY2022- Number of Board of Directors meetings: 12- Number of Audit & Supervisory Board meetings : 13
- Number of Nomination and Remuneration
Committee meetings

Issues from FY2022- Deepening discussions on sustainability, including
TCFD responses and investment in human capital- Further strengthening of risk management: 5- Increased efficiency of Board of Directors meetings by

Non-financial Data

Tetsuo Masuda

1970 : Registered with the Osaka Bar Association
1992 : Deputy Chairman of Osaka Bar Association
2004: Standing Director of Japan Federation of Bar Associations
2005: Chairman of Osaka Bar Association
Deputy Chairman of Japan Federation of Bar Associations
January 2007: Representative Partner of Nakanoshima Chuo Law Ofﬁce(to present)
April
2007: Chairman of Kinki Federation of Bar Associations
Governor of Kinki Federation of Bar Associations
June
2017 : Audit & Supervisory Board Member at NFC (to present)June2019 : Outside Auditor at Yanmar Holdings Co., Ltd.
March2020 : Outside Director of Ezaki Glico Co., Ltd. (to present)

June

April
April
April
April

Audit & Supervisory Board
Member (Outside)

Management Meeting
Disclosure Committee

Financial Data

(Born August 7, 1952)

LiaiseAppointment/Dismissal

Internal Committee
April
June

Audit &
Supervisory Board

Appointment/
Dismissal

Accounting Auditors

Appointment/Dismissal

Auditors

Kiyoshi Horie

Increase of outside director ratio to 1/3: 2021the Articles of Association as well as other key matters, and supervises the business execution of directors and corporate

Representative Director, President

Standing Audit &Supervisory Board Member

June

Audit

(Born October 13, 1952)

April
1979 : Joined NFC
January 2000: General Manager of Household Products Research Laboratory
March
2000: General Manager of Kobe Plant
September 2001 : General Manager of Industrial Chemicals Laboratory
April
2004: General Manager of Industrial Chemicals DivisionJune
2004: Corporate Ofﬁcer
September 2005: General Manager of Development Laboratory
June
2006: Deputy Senior General Manager of Manufacturing &Technology Division and General Manager of Material
Technology Department
June
2008: Senior General Manager of Manufacturing &Technology Division and General Manager of
Kakogawa-higashi Plant
April
2009: Deputy General Manager of Manufacturing & Technology
Division and General Manager of Kakogawa-higashi Plant
June
2011 : Standing Audit & Supervisory Board Member (to present)

Establishment of Nomination andRemuneration Committee

enhance the supervisory function.

Susumu Ota(Born June 17, 1945)

December: 2019

The Audit & Supervisory Board is made up of four auditors, including two outside auditors. The auditors audit the work of(Born July 26, 1960)

1968 : Joined Daito Chemix Corporation
1992 : Director at Daito Chemix
2000: Managing Director at Daito Chemix
2002: Representative Director and President at Daito Chemix
2002: Representative Director and President,
and Chief Executive Ofﬁcer at Daito Chemix
2008: Director at NFC (to present)

independent outside directors who are selected in order to further

Abolition of the retirement beneﬁt systemfor directors
Appointment of one independent outside
director

Sustainability

June

Director, Senior Corporate Ofﬁcer
Senior General Manager of Research& Development Division and Director,
Research Laboratory

September 2000 : Joined NFC
September 2005 : General Manager of Manufacturing Ingredients ResearchLaboratory Ofﬁce
June
2006 : General Manager of Manufacturing Ingredients ResearchLaboratory Department
June2008 : Corporate Ofﬁcer
April
2009 : Deputy Senior General Manager of Research Laboratory Division
April
2011 : Senior General Manager of Cosmetic Ingredients DivisionJune
2011 : Director (to present)May
2013 : General Manager of Research Laboratory (to present)June
2021 : Senior Corporate Ofﬁcer (to present)
April
2023 : Senior General Manager of Research & Development
Division (to present)

The Board of Directors is made up of six members, including two

Introduction of corporate ofﬁcer system

Business Content

June
June
June

1974 : Joined NFC
2005: General Manager of Takasago Plant
2008: Corporate Ofﬁcer
2008: Senior General Manager of Manufacturing &Technology Division2010 : Director (to present)2015 : Executive Corporate Ofﬁcer (to present)2017 : Excutive Supervisor for Group Company Production
Management (to present)■ Initiatives to strengthen corporate governanceManagement Storategy

Representative Director,
President

April
April

Top Message

Nippon Fine Chemical is aware that enhancing corporate governance is a key issue required for improving corporate

improving materials for these meetings
1112

History of Nippon Fine Chemical

1939:
World War Two starts

1950:
Korean War starts

1962:
Prohibition of camphor
monopoly

A subsidiary was established with the purpose of manufacturing synthetic
camphor (1941). In our business transformation period (1954), Nippon Fine
Chemical continued working at the Kobe Plant and expanded into the fatty
acid and other oil-related products business.
In the early 1960s, we added more production facilities to our Kobe Plant,
and then built the new Kakogawa Plant (1969, now the Kakogawa-nishi
Plant) and the Takasago Plant (1970), further developing our production
facilities.

Research on manufacturing
synthetic camphor

Workers in the plant

1960s

In 1966, we moved ahead with R&D andcommercialization of cosmetics base materials as a
new ﬁeld, and started production of the Eselan
series of special high-grade cosmetics bases.
Following that, we have produced Arbutin, a raw
material for high added-value whitening cosmetics(1990), the Presome C series of phospholipids forcosmetics that add new functions to protect theskin and encourage its revitalization (1990), the
LUSPLAN series of high-gloss, high-adhesion liquid
functional esters (2001), the Plandool series ofhigh-foaming paste functional esters (2002), andthe Neosolue series of cosmetics esters that
dissolve in both water and oil (2007).
Today, we are still developing a variety of products,
including those with hair damage repair functions andthose with physiological functions derived fromrenewable natural raw materials.
(See pp. 17-18)

1980s

1973:
First Oil Crisis

1986:
Equal Employment
Opportunity Law enacted

In 1971, we changed our company name to
Nippon Fine Chemical Co., Ltd., signifying a
new start with further aspirations for the
future as a ﬁne chemicals manufacturer.
In 1976, we relocated the Head Ofﬁce from
Kobe to Osaka, and in 1981, we set up a newlaboratory in the Takasago Plant.

Former Head Oﬃce building

1990s

Takasago Laboratory

Developing the technologies we fostered in
the fatty acid and oil-related products business,
we started the production of a number of ﬁne
chemicals, including PNC-390, a monomer raw
material for inﬂammable elastomers (1978);
Solanesol, a raw material for the Q10 coenzyme(1979); DEET, a mosquito repellent (1981); NSC,
a plastic surface hardener (1982); Albath, atablet-type bath salt (1985); and Squalane, an
LD oil reﬁned from shark oils (1986). These
products supported the company during the
1980s.
Based on the synthesizing and evaluation
technologies we have built up this way over many
years, we continue to supply raw materials andintermediates for pharmaceuticals, functional
resins, electronic materials, and a variety ofother industrial ﬁelds.
Today, our Spiro-MeOTAD, a material usedin perovskite solar cells, is attracting a lot of
attention.
(See pp. 21-22)

1995:
Great Hanshin-Awaji
Earthquake

In 1986, we established a pilot plant suitable
for the manufacture of investigational drugintermediates for pharmaceuticals at the Takasago
Plant, and then expanded our production
facilities at the Takasago Plant, the Kakogawa
Plant (now the Kakogawa-nishi Plant), and the
Kakogawa-higashi Plant.
Along with these investments in facilities, we
also accumulated more advanced technologies.

FPC Plant

Facility for producing
phospholipids for pharmaceuticals

We started researching lipids for pharmaceuticals
to increase the added value of our fatty acidand oil-related products business, and in 1986
we started providing the market with our ﬁrst
phospholipid product, dipalmitoylphosphatidylcholine(DPPC). Since then, we have not stopped withhigh-purity lipids or cholesterol lipid products,
but have continued to manufacture and sell
Presome, our unique lipid admixture, and ourcore product groups meet the GMP international
standard for the manufacture and quality
control of pharmaceuticals.
In recent years, to handle the changing medical
industry, which is seeing things like thedevelopment of nucleic acid medicine/lipid
nanoparticle formulation as shown in the COVID-19
vaccine, in 2022 we completed construction of aplant to handle the increasing demand forphospholipids for pharmaceuticals and a dedicatedplant based on an alliance with Gilead Sciences,along with a special ofﬁce building where we willbring together various functions so that we cansmoothly handle responses. Moreover, in April
2023, we opened the Shonan Laboratory, which
is aimed at promoting open innovation, within
the Shonan Health Innovation Park. We arealways evolving.
(See pp.19-20, p.23)

Camphor, etc.
NSC coatings

Plandool

Spiro-MeOTAD structure

NeutronPicolet series products

13

Liposome skin lotion(skin lotion containing Presome)(L) Overall view of the plant and oﬃce building
completed in FY2022(R) Shonan Health Innovation Park, in which
Nippon Fine Chemical has facilities

2008:
Lehman Brothers
bankruptcy
2011:
Great East Japan
Earthquake2010 on2018:
Nippon Fine Chemicalcelebrates its centennial
2020:
COVID-19 coronavirus
pandemic

We added a plant (NLP) that can handle the increased
demand for phospholipids for pharmaceuticals and a
dedicated plant (LP3) based on an alliance with Gilead
Sciences, Inc. in 2022.

NLP

LP3

In 1990, we acquired shares in a company which
manufactured and sold medical soap liquids, and thefollowing year we changed its name to Arbos Co., Ltd.
Arbos manufactures and sells a range of commercial
cleansers, pharmaceuticals, non-pharmacy products,
cosmetics and more. In the recent COVID-19 pandemic,
it contributed greatly by delivering hygiene products tohomes, companies, facilities, and other areas where
they were needed.

Arbos products

In 1995, we merged with Yoshikawa Oil and Fat Co.,
Ltd., manufacturers of lanolin for raw materials used incosmetics and pharmaceuticals.
Along with inheriting their expertise in the lanolin, cholesterol,and other derivatives businesses,
the business has evolved to form
one of the core businessesof Nippon Fine Chemical.
(see p.24)

Non-financial Data

LUSPLAN

2000s

Financial Data

In 1954, the rapid advancement of
petroleum-based plastics and overseas
synthetic camphor meant that we had todevelop new businesses, and so we started
our fatty acid and oil-related products
business.
Since then, we have started the productionof fatty acid chlorides (1956), butyl stearate,
IPM (isopropyl myristate), IPP (isopropyl
palmitate) and other fatty acid esters (1957),
and the production of Neutron, a fatty acidamide used for polyoleﬁn ﬁlm lubricants(1958). These products are almost monopolies
within domestic demand, and have formed
the driving force of our fatty acid andoil-related products business.
(See pp. 21-22)

Motoyama Plant(Kobe Plant, former Oils Plant)

1970s

Sustainability

Since our founding, our business has focusedon camphor, which is used as a raw material for
pharmaceuticals, insect repellents, and celluloid.
We maintained our international competitivenessby afforestation projects using camphor trees,
which are where camphor comes from, andcarrying out research and manufacturing ofsynthetic camphor, in addition to selling reﬁned
camphor.
Products that use camphor as their raw
material include insect repellants such as
Fujisawa Camphor, Camphor (1933) and so on
for pharmaceutical use, and the Picolet seriesof air fresheners for toilets (1977).
The Picolet series was one of the main
drivers of our household products business,along with camphor for insect repellent, rightup to the 1990s, creating an era.

1950s

1945:
World War Two ends

On February 12, 1918, we were established as Nippon Camphor Co., Ltd.
in Kobe, and expanded our business in a form that corresponded to thegovernment policy to unify the camphor business.
As our domestic business developed and expanded, we moved into China
and Taiwan, but by the close of WW2, the bulk of our domestic facilities had
been destroyed, and our overseas facilities were requisitioned following thewar.
We rebuilt part of our camphor plant the year after the war ended andrestarted production, recovering along with the nation.

Nippon Camphor Co., Ltd.

Products/Technologies

1940s

Business Content

Establishments/Facilities

1918:
World War One ends

1930s

Management Storategy

World/
Society

1918-1929

History of Nippon Fine Chemical

Top Message

For a hundred years since our founding, we have contributed to the beauty and health, and prosperous livesof people.
We shall actively respond to upcoming changes in eras, always innovating, as we aim to become a corporationthat grow sustainably for the next hundred years, a corporation that can continue to oﬀer value to society.

14

Nippon Fine Chemical Group Businesses

Business segments

Four key business ﬁelds
Group companies

Business fields
Beauty care field

NIPPON FINE CHEMICAL CO., LTD.

●

Nissei Bilis Co., Ltd.

●

Oleotrade International Co., Ltd.

●NISSEI PLAS-TECH CORPORATION●

Sichuan Nipo Fine Chemical Co., Ltd.

●

Zillion Fine Chemicals International Co., Ltd.

Environmental Hygiene Products●

Arbos Co., Ltd.

Hygiene ﬁeld

Other

●

Nissei Bilis Co., Ltd.

Real estate

Health care field
Fine chemicals field
Trading● Phospholipids for cosmetics● DDS materials/development● Active ingredients● Pharmaceutical Intermediates● Pharmacology/safety testing● Wool grease derivatives forand manufacturing support● Functional esters for cosmetics● Natural polysaccharides● Wool grease derivatives
for cosmetics

Fine chemicals
ﬁled

Core technologies that support our businesses

Health care ﬁeld

Synthetic organic
chemistry
Polymer chemistry
OleochemistrySurface science
Dermatology
Nanotechnology

pharmaceuticals

DDS: Drug Delivery System

Hygiene ﬁeld

● Assorted acid chlorides● Materials for perovskite
solar cells● Functional coatings (NSC)● Resin additives● Lubricants for powder metallurgy● Assorted wool grease derivatives

Sustainability● Hand soap liquids● Hand sanitizers● Public health products● Food sanitation products● Medical hygiene products

Business Content●

Beauty care ﬁeld

Management Storategy

Business segments

Functional Products

Top Message

Our businesses cover the two segments of Functional Products and Environmental Hygiene Products,
and four key ﬁelds.

Comparison of key business ﬁelds

8.0 billion yen
29%

Operating proﬁt composition ratio

7.6 billion yen
27%

FY2022

0.9 billion yen
20 %billion yen
6.4 billion yen
23%

5.7 billion yen
21%● Beauty care15

● Health care

FY2022

4.5

billion yen

0.9 billion yen
20 %● Fine chemicals

2.0 billion yen
44%

Non-financial Data

27.7

0.7 billion yen
16%

Financial Data

Sales composition ratio● Hygiene

16

Functional Products: Beauty Care Field

Functional products segment
Sales composition ratio

Functional products segment
Operating proﬁt composition ratio

Top Message

Sustaining KIREI, creating a society full of smiles.

Functional esters for cosmetics
Main products

7.6●Highly soluble esters●Products for haircare- Plandool™ series- LUSPLAN™ series- FineNeo™ series- NanoRepair™ series- Erucalactone series

FY202239%

2.0billion yen

billion yen

52%

Business Content

Medium-term management plan

●Plant derived esters- Neosolue™ series

Basic policy

For the beauty care ﬁeld, we have positioned “Phospholipids for cosmetics,” “Functional esters for cosmetics,”
and “Active ingredients” as the three ﬁelds to focus on, which we do so based on the following basic policy.
(boosting capital investment)- Expansion of sales to overseas markets, especially the West and China, where high growth is expected- Expanding sustainable products such as RSPO and non-GMO*

At Nippon Fine Chemical, we offer a range of sustainable materials made from carefully selected plant oils, which
are highly regarded by customers not just in Japan, but around the world. We shall continue aiming to increase theshare of overseas sales.
In addition, we offer a diverse lineup that covers skin care, hair care, make-up, and sunscreens, accurately
identifying customer issues in these areas, and offering a full support system right from prescription development.

*RSPO: Roundtable on Sustainable Palm Oil (certification system)
Non-GMO: Not genetically-modified organisms

Active ingredients
Main products●Skin brightening agent

Main products- Phytopresome™ series- Presome™ series●Natural origin emulsiﬁers- Phytocompo™ series- Composite series●Bioactive lipids- PrimeLipid™ series- Arbutin- Ethyl ascorbic acid
- Tranexamic acid

●Polysaccharides- Tremella fuciformis polysaccharide Tremoist™ series- Inulin-SC

Financial Data

Phospholipids for cosmetics●Liposome precursors

Sustainability- Expansion of sales of phospholipid materials for cosmetics and development of a system to increase production

Management Storategy

FY2022●Functional esters

At Nippon Fine Chemical, we also offer unique bioactive
In our Liposome precursors, we offer the Phytopresome™ and Presome™
and serums containing active ingredients such as ceramides and astaxanthin.
In our Natural origin emulsiﬁers, we offer the Phytocompo™ and Composite
series.
These ﬁnd use in emulsions, creams, sunscreens, and in hypoallergenic
cosmetics that can be used even by people with sensitive skin.
Our PrimeLipid™ series offers new value for phospholipid materials basedon solid evidence.

17

In skin brightening agents, our lineup covers the three typesof Arbutin, Ethyl ascorbic acid which is a Vitamin C derivative,
and Tranexamic acid. We offer support from prescription
development to pharmaceutical applications to suit ourcustomersʼ development concepts.
In addition to the Tremella fuciformis polysaccharide
Tremoist™ series, a fungus which the famed beauty Yang
Guifei is said to have favored, we also provide Inulin, which

Non-financial Data

series. We have received high praise from customers who have used lotions

substances.

ﬁxes the microbiome, as a raw material for cosmetics.

18

Functional Products: Health Care Field

Functional products segment
Sales composition ratio

Functional products segment
Operating proﬁt composition ratio

Support for the development and manufacture of pharmaceuticals

Top Message

Contributing to “Health: KIREI” and to a society full of smiles through chemistry.

Main products and services- Presome™

FY2022- Liposome preparation studies- LNP preparation studies

FY2022

5.7

0.9

billion yen

There is increasing segmentation of ﬁelds within the
medical industry in recent years.

billion yen

At Nippon Fine Chemical, we actively engage in CDMO
services to support drug development using our lipid

24%

nanoparticle production technology as our base technology.
In addition to the liposome technology independently
developed by Nippon Fine Chemical, we carry a wide rangeof phospholipids essential for LNP formulations, such as
the COVID-19 vaccine, from general-purpose materials to

Medium-term management plan

proprietary materials, allowing us to assist in the development

Basic policyof the ﬁeld of nucleic acid pharmaceuticales.
We can respond to customer requests quickly.

In the health care ﬁeld, our focus areas are pharmaceutical lipids such as phospholipid materials and cholesterol,- Solid startup of production based on large-scale investment in phospholipids for Pharmaceuticals

LNP schematic diagram
This is a formulation in which particles containing a nucleic acidas a drug substance enveloped in cationic lipids are containedin a capsule made of phospholipids and cholesterol

Sustainability

which we carry out based on the following basic policy.
- Expansion of business from being focused on small molecular pharmaceuticals to areas such as nucleic acid
pharmaceuticals where high growth is expected

Pharmacology/safety testing- Focus on being a CDMO for the development of pharmaceuticals

Main services

Lipids and cholesterol for pharmaceuticals- Safety testing/safety pharmacology testing- Mock usage testing of medical devices●A range of lipids for pharmaceuticals- High purity cholesterol- Cationic lipids for nucleic acid medicines
Note: Supports GMP

At Nippon Fine Chemical, we manufacture a range of phospholipids forpharmaceuticals using our proprietary production process. One of ourstrengths is being able to manufacture high purity cholesterols in-house.
of trust among customers both in Japan and overseas. Our lipids havebeen used in a large number of pharmaceuticals.
In addition to our core products, we offer liposome materials that caneasily carry out cationic lipid and drug repositioning, which are essential
for the LNP formulations that gained note in the COVID-19 vaccine.
【Abbreviations】 LNP : Lipid Nano Particle
CDMO : Contract Development Manufacturing Organization
GMP : Good Manufacturing Practice19

testing within the pharmaceuticals ﬁeld.
We contribute to maintaining people's health andthe social environment by evaluating the safety andeffectiveness of pharmaceuticals, medical devices,
regenerative medicine products, and more.
In addition, we will also have an animal-friendly
laboratory that meets international standards andadheres strictly to the 3Rs principle.
*3Rs:- Refinement : reducing the suffering of animals- Reduction: reducing the number used
- Replacement : finding replacements

Non-financial Data

Our lipids are manufactured according to GMP, and enjoy high levels

In the contract business department of Nissei
Bilis Co., Ltd., we work on pharmacology/safety

Financial Data

- Drug efﬁcacy pharmacology testing for pharmaceuticals- Non-clinical testing of regenerative medicine products

Main products- Phospholipids for pharmaceuticals

Business Content

29%Management Storategy●DDS materials/CDMO services

20

Functional Products: Fine Chemicals Field

Functional products segment
Sales composition ratio

Functional products segment
Operating proﬁt composition ratio

Top Message

Our high purity, high quality new materials help make the future KIREI.

Fatty acid amides
Main products

32%

FY2022

FY2022billion yen

billion yen

6.4- Neutron™ series

One of Nippon Fine Chemicalʼs top products is our fatty

0.9acid amides.
These are produced by Sichuan Nipo Fine Chemical, an
afﬁliate located in Sichuan Province, China.
By adding these to the surfaces of shopping bags, it iseasier to separate the two surfaces when they are stuck
as plastic additives.
There has been a large increase in environmentally-friendly
plastics recently.

Medium-term management plan

We are focusing on expanding sales to target markets like this.

Basic policy

In the ﬁne chemicals ﬁeld, we utilize our organic synthesis technologies in the two ﬁelds of electronics andFunctional coatings (NSC)
Sustainability

resources/energy to offer a range of materials. The medium-term management plan is run in accordance with thefollowing basic policy.
- Contributing to the commercialization of perovskite solar cells (Resources & Energy)- Expansion of sales of materials for high dielectric constant resins used in next-generation communication
technologies (Electronics)- Reorganization of low-proﬁt products

Materials related to electronics and resource energy

Main products- Hard coatings for helmet visors- Anti-fogging coatings- Hard coatings for medical goggles- Hydrophilic coatings

Coatings to prevent scratches
or fogging for medical goggles or
Chemical products, helping people●Materials for perovskite
solar cells●A range of materials for engineering plastic- High-purity organic acid chloride●Resin additives- Release agents, lubricantssee more KIREI.
We will focus on this segment,
where we expect more and moredemand in future for products likeAt Nippon Fine Chemical, we can offer a range of acid

Financial Data

helmet visors also use Nippon Fine
Main products

Business Content

together. This is just one of the ways these amides are used

Management Storategy●Fatty acid amides

24%

anti-fogging or hydrophilic coatings.

chlorides by utilizing our specialty halogenation technology.
These acid chlorides are essential materials for engineering
We will focus on the electronics market, where
demand for products such as substrates for high-speed
communication is expected to increase even further.
In addition, the ﬁelds where Nippon Fine Chemical
Substrates for high-speed communication

21

Perovskite solar cells(Photo credit:Toin University of Yokohama)materials are used are expanding more and more even in
the resources and energy ﬁelds, such as for perovskite

Non-financial Data

plastics such as polyimide and polyamideimide.

solar cells.

22

FocusMaterial

Phospholipids

Smile on Faces; The KIREI power of the Phospholipids,
by Nippon Fine Chemical.
We shall boost our R&D and sales for phospholipids in the ﬁelds of beauty care and health care, where we expect toNippon Fine Chemical.”Sustainable materials from wool

Lanolin is a natural oil obtained by purifying wool grease, the lipid components adhering to wool. Lanolin contains
many components similar to human epidermal lipids such as cholesterol and branched fatty acids.
Lanolin is not an internal fat (subcutaneous fat) like lard or tallow. Rather, it is obtained from wool sheared every year
and does not harm animals in any way. It is a recyclable, sustainable material that is safe and people-friendly,
sheep-friendly, and environment-friendly.
These characteristics are leveraged to use it in a wide variety of applications in the functional products segments ofbeauty care, health care, and ﬁne chemicals.

Beauty care ﬁeld

Beauty care ﬁeld

Health care ﬁeld

Health care ﬁeld

Markets

Main products

Main products- Skin care forecast to grow 7.5% CAGR
in the global market (2020-2030)- Nucleic acid medicine forecast to grow
16.6% CAGR (2020-2026)

Ecolano™ series- Lanolin for pharmaceuticals- The market drivers will be the United States,
China, and Europe- Segmentation of pharmaceuticals development- Lanolin for cosmetics- High-purity cholesterol

Initiatives

Initiatives- Differentiation through LNP/liposome technology- Strengthening sales overseas- Solid maintenance and expansion of existing
businesses- Expand production capacity to expand sales- Utilize up-cycled raw materials and expand uses

- Maintain GMP-compliant production andassurance system- Cholesterol for cosmetics- Cholesterol derivatives for cosmetics

Main uses- Ointments for pharmaceuticals

Main uses- Liposome/LNP* formulations- Skin care: barrier functions*LNP: Lipid Nano Particle

Business Content

Markets

Management Storategy

see further market growth in the future, aiming have people say “when it comes to phospholipids, look no further than

Lanolin and Cholesterol
Top Message

The power inherent in our phospholipids helps makes things KIREI.

Focus
Material- Hair care: hair surface modiﬁcation oils
- Make-up: pigment dispersion/gloss
Sustainability

We have published a special site for phospholipids.
With plenty of illustrations, it is a fun way to easily learn about phospholipids.

Fine chemicals ﬁled

See: https://www.nipponseika.co.jp/en/phospholipid/

Main products- Rust prevention/lubricants (LanoAce™ series)- Cholesterol for LCDs
- Cholesterol for animal feed

Financial Data

Main uses- Rust inhibitors for car bodies and lubricants
for metals‐ LC displays- For shrimp feed
Our lanolin/cholesterol mascots:
Ecola (L) and Lano (R)Non-financial Data

23

24

■ Sustainability Philosophies and Framework
Participation in initiatives and information disclosure

Our Management Philosophy of "Contributing to Society ThroughInitiatives in line with TCFD recommendations

Chemistry" as well as the "Smiles on Faces: The Power of KIREI" in our
long-term vision, the NFC VISION 2030, and our sub-concept of helping

Nippon Fine Chemical uses raw materials derived fromto sustain the three "KIREIs" of the Earth, society, and the future, form

fossils and fossil fuel as energy sources in thethe basis of our basic sustainability policy, "Aiming for our sustainable

manufacture of many of our products. Based on our

growth and to bring about a sustainable society".

recognition that risks and opportunities due to climatechange are key management issues, in December 2021,

Ofﬁce and Sustainability Committee, set KPIs (key performance indicators),

we declared our support for the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).

and are working on special related initiatives.

We are using scenario analysis to assess the risks and opportunities of the impact of climate change on our

We shall continue to ensure sustainability awareness reaches each andevery employee, and, through each of our initiatives, brings about the three "KIREIs" of the Earth, society, and the future,contributing to the smiles of everyone who is part of our company.

business. Going forward, we will recognize its signiﬁcance, strengthen the resilience of our strategies by reﬂecting
such impact in our management measures and strengthen relationships of trust with our stakeholders. In addition,
we have joined the TCFD Consortium, and are working to collect and share information related to TCFD.

See: https://www.nipponseika.co.jp/en/sustainability/pdf/tcfdreport̲2023.pdf

Participation in the United Nations Global Compact
We have established a Sustainability
Committee, chaired by our Representative
Director, President and composed ofRepresentative Director, President

members selected from each division andGroup company.
The Committee identiﬁes materialities(key issues), plans out promotion activities,
and manages progress. The progress results

Sustainability Committee

are reported to the Management Meeting（Membership: Sales, Purchasing, Production, Research,
Administration Divisions and Committees of Group companies）

Nippon Fine Chemical supports

In April 2022, Nippon Fine

the Ten Principles related to theChemical moved from the First

four ﬁelds of Human Rights,

Section to the Prime Market ofLabour, the Environment, andthe Tokyo Stock Exchange.

Anti-Corruption as stated by theWith this, we actively began

United Nations Global Compact

working on further strengthening(UNGC), and continues striving

our corporate governance andto achieve them. (see p.29)

internal management system.

and the Board of Directors, and the Board of
Directors supervises the progress of

Sustainability Committee Secretariat
Sustainability Oﬃce

Administration Divisions

activities. Operations are handled by thesecretariat, which is Administration Divisions,and the Sustainability Ofﬁce.

Information disclosure on platforms

Basic management policy on environment, safety, and quality
have set basic policies for theenvironment, safety, and quality

SafetyNippon Fine Chemical will continue to run operations without accidents and disasters
to ensure the safety of employees and local communities. Nippon Fine Chemical
speciﬁes the properties of products and how to handle them to protect the safety andhealth of all users including customers.

Quality

Nippon Fine Chemical will continue to provide quality products and services thatsatisfy customers and are reliable.

as follows, and all employees
independently and continuously
make improvements based onthese basic policies, fulﬁlling
our social responsibility.

25

stakeholders.

CDP

EcoVadis

Sedex

This is an NGO run by a British
charity organization for managing
environmental impacts. Nippon
Fine Chemical responded to theirclimate change questionnaire andtheir water security questionnaire in
FY2022.

This is a provider of rankings
founded in France, and Nippon
Fine Chemical obtained a Silver
Medal in FY2022.

A UK-based NPO, it enables thesharing of CSR self-assessment
questionnaire results and audit
results on an electronic platform.
Nippon Fine Chemical is one ofits users.

Non-financial Data

Environment

Nippon Fine Chemical is independently and continuously developing environmental
impact assessment and reduction activities in all processes, from product development
to manufacturing, use, and disposal, as well as complying with laws and regulations
related to business activities, in its effort to protect the global environment.

EcoVadis, and Sedex, striving to increase our management transparency and build trusting relationships with ourFinancial Data

Nippon Fine Chemical discloses and shares ﬁnancial and non-ﬁnancial information on platforms such as CDP,

At Nippon Fine Chemical, we

Sustainability

Management Meeting

Transition to the TSE Prime Market

Business Content

Sustainability organizations

Management Storategy

To carry out this basic policy properly, we have established a Sustainability

Board of Directors

Top Message

Basic sustainability policy

26

■ Materialities
Status of materiality initiatives for FY2022

At Nippon Fine Chemical, we identify materialities related to sustainability using the following steps.
1. Set the 34 GRI Standard items the basic materialities.
2. Create a matrix based on the two axes of “Importance to Stakeholders” and “Importance to Our Group.”

Theme

3. Following discussions at the Sustainability Committee, the materialities are ﬁnally categorized into ﬁve elements(22 items), the "Materialities to be Addressed."

Human
RightsHuman Rights

Environment

405:Diversity and Equal Opportunity

301:Materials

408:Child Labor

302:Energy

409:Forced or Compulsory Labor

303:Water and Effluents

412:Human Rights Assessment

305:Emissions
306:Waste

202:Market Presence
207:Tax
304:Biodiversity
406:Non-discrimination

308:Supplier Environmental Assessment

205:Anti-corruption

413:Local Communities

206:Anti-competitive Behavior
418:Customer Privacy

Achieve work-life balance by
supporting child-rearing andlong-term care
(KIREI of the future)- Ratio of child-careleave taken- Speciﬁc measures forlong-term care

- The goal is to take 70% or more ratio ofchild-care leave by the end of FY 2025.
- The speciﬁc measures for long-term care areconsidered.

- Ratio of child-care leave
taken: 38%

Develop products that can
co-exist with the environment(KIREI of the future and Earth)- Amount of R&D
investment- Number of patents- The goal is to have 750 million yen of
research and development investment in FY
2022.
- The goal is to apply 75 patents over the ﬁve
years between FY 2022 and 2026.

- Amount of R&D investment:
780 million yen- Number of patents: 16

Reduce emissions of substancestargeted by the PRTR System(KIREI of the Earth)- Amount of emissions of
substance stargeted by
the PRTR System- With the aim to reduce the amount of
movement by 50% or more compared to FY
2020 by the end of FY 2030, the speciﬁcstudies are carried out.

- Amount of emissions of
substance stargeted by the
PRTR System: 33%increase- Amount of greenhousegas emissions- Amount of renewableenergy used

- The speciﬁc studies are carried out to meetthe government target of reducing CO2
emissions in the industrial sector by 38% of
FY 2013 levels by 2030, based on the goal ofachieving carbon neutrality by 2050.
- The goal is to achieve 100% renewable energy
for purchased electricity by the end of FY
2023.

- Amount of greenhouse gas
emissions: 33% reduction- Amount of renewableenergy used:100%- Amount of industrial
waste generated- Recycling rate

- The speciﬁc studies are carried out to reduce
the generated amount of industrial waste by
20% or more compared to FY 2019 by the endof FY 2030.
- The speciﬁc studies are carried out to achieve
90% or more recycling rate by the end of FY
2030.

- Amount of industrial waste
generated: 30% increase- Recycling rate: 69%

Strengthen the effective use ofwater resources(KIREI of the Earth)- Amount of water used
- Amount of efﬂuent- The speciﬁc studies are carried out to reduce
the used amount of water by 10% or morecompared to FY 2019 by the end of FY 2030.
- The speciﬁc studies are carried out to reduce
the amount of efﬂuent by 10% or morecompared to FY 2019 by the end of FY 2030.

- Amount of water used: 15%
reduction- Amount of efﬂuent: 18%
reduction

Strengthen compliance(KIREI of society)- Rate of compliancetraining session
attendance- The goal is to achieve 100% attendance rateof compliance training session.

- Rate of compliance training
session attendance: 100%

- Number of workplace
accidents- Rate of training session
attendance (chemical
substance, safety
training)- Rate of stress check
implementation- The goal is to achieve zero occurrence ofworkplace accidents every ﬁscal year.
- The goals is to achieve 100% attendance rate oftrainee session for chemical substances/safety
training, etc. every ﬁscal year.
- The goal is to achieve 85% or more
implementation rate of stress check every ﬁscal
year.

- Number of workplace
accidents: 6- Rate of training session
attendance (chemical
substance, safety
training):100%- Rate of stress check
implementation:93%- Number of quality
claims- The goal is to reduce the number of quality
claims by 50% from that of previous ﬁscal year
in each ﬁscal year.

- Number of quality claims:
45% reduction

403:Occupational Health and Safety

Product Safety,Quality
414:Supplier Social Assessment

404:Training and Education involves
all five factors above

416:Customer Health Safety
417:Marketing and Labeling203:Indirect Economic Impacts

201:Economic Performance

204:Procurement Practices

402:Labor/Management Relations

410:Security Practices

407:Freedom of Association and Collective Bargaining

Contribute to achieving acarbon-neutral society(KIREI of the Earth)Environment

Reduce industrial wasteandpromote resource recycling(KIREI of the Earth)

411:Rights of Indigenous Peoples
415:Public Policy

Importance to Our Group

Initiatives and KPIs
Compliance

The identiﬁed 22 materialities to be addressed(key performance indicators), and numerical goals
have been set as shown in the table.

NFC VISION 2030
KIREI of the future
Sustaining the KIREI of the future through diversity-driven innovation

KIREI of the Earth
Sustaining the KIREI of the Earth through sustainable manufacturing

KIREI of society
Sustaining the KIREI of communities through compliance,safety,and actions
that ensure peace of mind

27

Occupational Prevent workplace accidents andensure health and safety for
Healthworkers
and Safety(KIREI of society)

Product
Safety &Quality

Contribute to society throughsafe and reliable products(KIREI of society)Non-financial Data

- Ratio of disabled people
hired:2.67%

Financial Data

- Ratio of disabled people - The goal is to have 2.3% or more ratio of
disabled people hired by the end of FY 2023.
hired

Sustainability

Be a workplace wherepeople canwork equally regardless of
disability(KIREI of the future)

401:Employment

VISION 2030", and then speciﬁc actions, KPIs

- Ratio of females inmanagement: 0%- Ratio of female employees: 15%- Ratio of females inmanagement andmanagement
candidate: 7%-Ratio of female
employees-Ratio of females
in management

Occupational Health and Safety

419:Socioeconomic Compliance

Nippon Fine Chemicalʼs long-term vision, "NFC

- With the aim of having 30% or more ratio of
females in management by the 2030s, thegoals are to have 20% or more ratio of female
employees, as well as 15% or more ratio of
females in management and management
candidate by FY 2027.

Be a company where women canplay an active role
(KIREI of the future)

SDGs

307:Environmental Compliance

Complianceare categorized into the three sub-concepts in

Performance*

Business Content

Importance to Stakeholders

Materialities to be Addressed

Numerical Goals*

Management Storategy

Materialities matrix

KPIs
Initiatives（NFC VISION 2030） (Key Performance
Indicators)

Top Message

Identifying materialities*The goals and the performances are of Nippon Fine Chemical alone.

28

■ Respect for Human Rights

The Nippon Fine Chemical Group set the Nippon Fine ChemicalGroup Human Rights Policy in March 2023. This is in accordancewith our principle of respecting the rights of all persons involved
with our business activities and avoiding any and all discriminatory
treatment, and based on the International Bill of Human Rights,
the ILO Declaration on Fundamental Principles and Rights at Work,

Depict a human resources portfolio that can

We shall contribute improving both the work andcontribute to achieving business strategies andlife of each and every employee, working closely withcreating innovation, and work on the diversity ofthe diverse values of workplace members, with theknowledge and experience within an organization

aim of creating a company of smiles through work,

towards this. In addition, we will contribute to thewhere people can take pride in being a Nippon Fine

realization of a culture in which each and every

Chemical employee.

employee can sense their growth and continues to■A workplace environment that is easy to work inwork towards self-actualization.

Principles on Business and Human Rights.
Our Human Rights Policy lays out the Groupʼs policies vis-a-vis all our ofﬁcers and employees, as well as our business
partners and suppliers with the expectation that they will participate in similar initiatives. We shall continue to encourageand collaborate with them in order to promote initiatives that respect human rights.

Initiatives■Diversity
The NFC VISION 2030 includes “Sustaining the KIREI

we are developing systems that make it easier toof the future through diversity-driven innovation.” We

work, such as bringing in a teleworking system orare implementing a range of different initiatives toworking interval system. In addition, we are working toachieve the targets we have set for promoting thedevelop a safe, secure, and comfortable workplaceempowerment of women.

environment to allow our employees to make full use■Developing human resourcesof their abilities.

■Support for balance

employee is connected to the sustained development

By improving the quality of employeesʼ work-lifeof our company, we shall contribute to the proactivebalance, we can increase engagement with work, which

In March 2023, Nippon Fine Chemical announced

The Nippon Fine Chemical Group is working on

career development of individual employees, starting

leads to company expansion. To that end, we are

we would become a signatory to the United Nations

Human Rights Due Diligence in order to identify

with support for rank-speciﬁc group training andpromoting initiatives towards supporting employees who

Global Compact (UNGC) and support the UNGC as

negative effects on human rights, and prevent or

independent learning for employees' own growth.

work while balancing child-raising, caregiving, and so on.

a participating company.

mitigate them.

Freedom of association and the right to collective bargaining

Enacting harassment prevention measures

At Nippon Fine Chemical, the Nippon Fine Chemical
Workersʼ Union was formed in 1971 as an employeesʼ

The Nippon Fine Chemical Group is working toensure sound workplace environments without

union, and remains active today. About 76% of all

discrimination or harassment from a stance of “Do

employees are organized.

not do, do not cause, do not allow” harassment such

Designed to create a sound global society, theUsing a risk assessment method that references

UNGC is the worldʼs biggest sustainability initiative.

various guidelines on human rights, we have identiﬁed

The signatory companies and groups agree to upholdand evaluated risks that could create negative effects

its ten principles related to the four areas of humanon human rights (human rights risks), and which could

Rights, labor, the environment, and preventing

come about through our Groupʼs business activities.

corruption, and are required to continually work
towards achieving these.

In addition, based on this we have speciﬁed priority
risks our Group will deal with.

We promote ESG management in line with theTen Principles of the UNGC as a way to achieve theSDGs that aim to create a sustainable society,to achieve both sustainable corporate growth andto bring about a sustainable society.

The Nippon Fine Chemical Group has speciﬁed
the following eight priority risks. We shall work to
be aware of the current situation and take suchharassment and so on.

frequent dialogues and respecting each otherʼsposition.

measures as many be needed. These priority risks
will be continually revisited.

■Priority risks
Priority Risks

sound, smooth labor-management relations throughas power harassment, sexual harassment, maternity

Smile Farm (hiring the disabled)
Nippon Fine Chemical identiﬁes hiring the disabled as one of the points inGroups affected

Main risks

Diversity & Inclusion one of the goals of NFC VISION 2030, and is promoting

Access to relief offices

All stakeholders

Inappropriate responses when infringements of human rights
are noticed

their employment.

Employee privacy

Nippon Fine Chemical employees

Leaking of employeesʼ personal information

HR and labor for employees

Nippon Fine Chemical employees

Unpaid wages, interference with freedom of association andcollective bargaining, and undeveloped disciplinary systems

situations where it is hard to provide employment to the disabled. So in June

Health and safety of employees

Nippon Fine Chemical employees

Dangers, harsh working environments, fires/explosions

Health and safety of local communities

Local communities

Damage to local communities and health impacts from fires,
explosions, or chemical leaks

Health and safety of clients and consumers

Clients, Consumers

Obstruction of client/consumer choice due to lack of appropriate
product information

Health and safety in the supply chain

Suppliers

Dangers, harsh working environments, fires/explosions

Child labor in the supply chain

Suppliers

Child labor, dangerous work assignments, harsh working conditions

Financial Data

based on our basic sustainability policy which aims

■Priority risks

We are working to maintain and further strengthen

Sustainability

Initiatives for Human Rights Due Diligence

Participation in the United Nations Global Compact

Business Content

Based on the idea that the growth of each and every

At the same time, we are a chemicals products plant, and there are many
2022, we participated in the social farm of S-Pool Plus, Inc. and opened
Nippon Fine Chemical Co., Ltd. Smile Farm in Yodogawa Ward, Osaka.
At Smile Farm, which has the watchword, “Smiles for everyone through thepower of vegetables,” two NFC employees serve as farm managers, working
alongside six disabled NFC employees to hydroponically grow vegetables.
The harvested vegetables are provided to childrenʼs cafeterias in Osaka andHyogo prefectures, helping us ensure ESG management.

Non-financial Data29

To work towards improving the work-life balance ina way that our employeesʼ diverse values into account,

Management Storategy

the Ten Principles of the UN Global Compact, and the UN Guiding

Policy for developing the internal environment

Top Message

Human resources development policy

Basic ideas

30

■ Environmental Preservation
Initiatives for the appropriate management of chemical substances
The manufacture and sale of chemical substances

activities in all processes, from product development to manufacturing, use, and disposal, as well as complying with laws

is governed by an extremely large set of laws andand regulations related to business activities, in its effort to protect the globe.

regulations, including the Chemical Substances
Control Law, the Industrial Safety and Health

Environmental management system

Act, Poisonous and Deleterious Substances Control

14001 Environmental Management System (ISO14001:2015) certiﬁcation, and are promoting environmental
preservation through our business activities in accordance with speciﬁc environmental policies.
In addition, since obtaining certiﬁcation, we have been inspected annually by the certiﬁcation organization to
conﬁrm our compliance with standards, and we are working on ongoing improvements and effective activities.

Act, and the Water Pollution Prevention Act.
Nippon Fine Chemical complies with thesevarious environmental laws and regulations, aswell as the bylaws and agreements of various
local authorities. In addition, to minimize theenvironmental burden, the harm to humans, andthe danger of our production processes, we carry

Health and safety/
occupational healthmanagement
Management of
the Chemical Substances
Control Law, Industrial
Safety and Health Act,
Poisonous and Deleterious
Substances Control Law,
Fire Service Act, overseas
legal regulations, etc.

WorkerChemical substances
Resources
Products

Atmospheric,water quality,
soil, waste
management

SDS/
Yellow Card
management

Clients

Energy managementout comprehensive management of environmentally

Environmental policy

SDS

Raw materials

Waste

hazardous chemical substances.

environment have been established as follows, and we are working towards continuous improvement.
1. Our production is designed to understand and comply with environmentally-related laws and regulations, andensure there are no serious effects on the environment in or outside our company.
2. We are reducing the usage of chemical substances that impact the environment and using raw materials that
3. Speciﬁc targets, goals, and periods are set, energy-saving activities are done in a planned fashion, and we saveresources and reduce the amount of waste generated.
4. We work to suppress or mitigate the dispersion of bad smells (waste water, raw materials, or other bad smells
arising from production) to co-exist with the community.

For PCBs (polychlorinated biphenyls), which are hazardous substances, low-concentration PCBs are subject to
the Act on Special Measures Concerning Promotion of Proper Treatment of PCB Wastes (PCB Special Measures
Act), which requires that they be treated by March 31, 2027.
The waste contained PCBs held by Nippon Fine Chemical is stored and managed properly in accordance with thisact, and we have been treating it appropriately.
Starting in September 2022, we began to remove low-concentration PCB waste remaining at our Takasago Plant.
The ﬁnal treatment was completed in February 2023. This work means that all PCB waste held by NFC has beentreated.

Financial Data

Material ﬂow
The material ﬂow of our production
INPUT

OUTPUTthe diagram to the right.

Carbon dioxide
12,429 t

We are always striving to produce
more products efﬁciently using lessraw material, energy and water, while
producing less waste.

31

Water
410,129 t

FY2022
production
activities

Materials covered by
the Law concerning Pollutant
Release and Transfer Register

29 t

Waste
2,806 tWaste water
187,137 t

Takasago Plant low-concentration PCB
waste treatment work under way

Takasago Plant low-concentration PCB
waste treatment work completed

Non-financial Data

Note: For “Energy” here, city gas, electricity
and other energy sources are used, so
the energy conversion coefficient as per
the Act on the Rational Use of Energy isused and the unit standardized as KL.

Energy9,136KL

Sustainability

consider sustainability to provide environmentally-friendly products.

Low concentration PCB waste treatment

Business Content

Nippon Fine Chemical's Kakogawa-Higashi Plant and Takasago Plant produce raw materials for cosmetics, forpharmaceuticals, and functional ingredients, etc. To continue pursuing production operations, policies concerning theactivities for FY2022 is as shown inManagement Storategy

At the Kakogawa-higashi Plant and Takasago Plant, Nippon Fine Chemicalʼs main sites, we have obtained ISO

Law, the Fire Services Act, the Air Pollution Control

Supplier

Manufacturing process

Nippon Fine Chemical is independently and continuously developing environmental impact assessment and reduction

Top Message

Basic ideas

32

Amount of water used

For boiler emissions, we measure the amounts of

GHG emissions
The greenhouse gases (GHG) emitted by Nippon（%）(Unit: tons)
30,000Fine Chemical are largely carbon dioxide from our

120

100

energy usage. Regarding Scope 1 and Scope 2, within
the overall target of a 46% reduction from FY2013 of100

SOx have been dropping since our switch fromour low emission levels of NOx.

5,402

15,000processes and bringing in boiler wastewater
neutralization equipment, we have been able to use

7.9

58

54

60

(Unit: tons)
7.5

7.1

water more efﬁciently, reducing our water intake in

7.1

431

carbon dioxide emissions.

FY2022 by 21,000 tonnes year-on-year.
38

40(1,000 t)
600

5.0

7,500

We have brought in recover and reuse systems forsteam drain water and cooling water in plants, and

80
67

56

discharged into public water bodies and sewers.

by skipping the washing step in our manufacturing

5,866

a 38% reduction by FY2030 over FY2013 in our own

well as the emissions ratios based on FY1995, theis treated at waste water treatment facilities and then

13,514

12,505

13,351

11,998

2013

2020

2021

2022

20

year of the merger with Yoshikawa Oil and Fat Co.,
00

In FY2022, we switched to 100% renewable energy

2.5

400

(FY)

266

for our purchased energy, reducing Scope 2 emissions

Scope 2

Scope 1by around 5,400 tonnes year-on-year.

Compared to FY1995

Compared to FY2013

0.4

0.3
0.0

2020

We achieved a 33% reduction compared to FY2013

emissions, including Scope 3, and work to reducing
GHG emissions throughout the entire supply chain sothat we can achieve carbon neutrality.

Note: Until FY2020, carbon dioxide emissions were calculated
based on the Act on the Rational Use of Energy and the
Act on Promotion of Global Warming Countermeasures.
From FY2021, they are based on the GHG Protocol
Standard.

Reducing waste, recycling(Unit: tons)
3,000

（%）
100

1,054

2,000

Normally, the ratio of generated industrial waste

49
1,500

690

767
50

1,000

recycling, and work to reduce emissions and improve
our recycling rate.

33

0

36

30

33

34

2019

2020

2021

2022

Tap water

Nippon Fine Chemical submits notices of theWell water(FY)

Industrial-use waterand manages the chemical substances in question. We
have promoted the effective use of idle equipment,machinery maintenance, and the conversion of waste
into valuable resources, as well as worked to reduce ourin FY2022 our emissions were 1.5 tonnes higher, andtransfer amount 3.6 tonnes higher, due to the increase

further, working to reduce our emissions and transfer

Amount of energy used
Nippon Fine Chemical is working on reducing energy
usage through environmental management programs.
We have updated our high-eﬃciency steam boilers,
strengthened management of steam traps, and worked
to reinforce maintenance of steam piping and so on,achieving results in reducing energy consumption. Moreover,
we are actively using low-power, high-efﬁciency motors
and inverters, updating to high-efﬁciency freezers, andreplacing bulbs with LEDs as ways to reduce the(Unit: tons)
200.0

199.9

196.3

amount of electricity we use.
(10,000 GJ)
40.0

149.9

Non-financial Dataoutsource processing that allows thermal and material

165

25
500

1,464

1,128

1,272

30.0

1,752

100.0

We shall continue to promote the reuse and conversionof waste solvents into valuable resources, strive to155emissions and transfer amounts for PRTR substances*

150.0

working to achieve at least a 90% recycling rate by theend of FY2030.

178

535

Rate.” However, we have deﬁned a new “Recycling
Rate” that includes valuable resources, and so we are

Emissions of substances coveredby the PRTR systemamounts.

60

158

200

We shall continue to strengthen management still
75

69

210

(FY)

in production of speciﬁc products.

69

243

Financial Data

2,500

tonnes due to the increased production of speciﬁc

used for recycling has been shown as “Recirculation

2022

NOx

atmospheric emissions and transfer amount. However,to promote the 3Rs (Reduce, Reuse, Recycle). The

products.

2021

254

Sustainability

Scope 1: Direct GHG emissions from an operatorʼs own
fuel combustion
Scope 2: Indirect GHG emissions from the use ofelectricity and heat supplied by othercompanies
Scope 3: Indirect emissions other than Scope 1 or 2
(emissions from other companies related tothe business entityʼs activities)

We now intend to calculate the supply chain

amount of waste we generated in FY2022 grew by 766

0.3

SOx

in both Scope 1 and Scope 2 total emissions.

At Nippon Fine Chemical, we are working company-wide

Business Content

Ltd., and FY2013.

Management Storategy

5,071

required to reduce its energy-based carbon dioxide

The graph shows Scope 1 and Scope 2 emissions as

and industrial-use water. Waste water from our plants

operate them to comply with the regulation values.

22,500greenhouse gases in Japan by FY2030, industry isemissions by 38%. Therefore, NFC has set a target of

sulfur oxides (SOx) and nitrogen oxides (NOx), andheavy oil to city gas started in 2016. We are maintaining

103

96

Our water sources include tap water, well water,

Top Message

SOx and NOx emissions

Initiatives to reduce environmental impacts

2019

2020

Industrial waste
Specially-controlled industrial waste

2021

2022

(FY)

50.0

Recirculation rate
Recycling rate

Recirculation rate: (Amount of recycled materials) / (Total amount ofindustrial waste generated)
Recycling rate:(Amount of recycled materials + Amount of valuable
resources) / (Total amount of industrial waste +Amount of valuable resources)

16.2

20.0

0

0

15.5
14.2

0.0

29.3

27.8

24.1

2020

2021

PRTR atmospheric emissions

10.0

2022

(FY)

PRTR transfer amount*Substances covered by the PRTR system: Chemical substances as
defined by law that may be harmful to human health or the ecosystem.

0.0

22.3

20.0

2020

20.8

2021

Fuels

2022

(FY)

Electricity

34

■ Environmentally-Friendly Product Development
Product development

At Nippon Fine Chemical, we have speciﬁed our basic policy regarding qualityp25, and all employees will carry out

Nippon Fine Chemical is working on the development of a range of environmentally-friendly products, as shown here.

constant, autonomous, sustained improvements based on this policy, fulﬁlling our social responsibility.

Research and development using renewable raw materials with low environmental impact

Initiatives for quality assurance

We obtained ISO 9002 in 1996, and, following the later move to ISO 9001, have extended the number of covered
products. In March 2023, we completed extending application at the Kakogawa-higashi Plant and the Takasago Plant,
which means all Nippon Fine Chemical products are now managed in accordance with ISO 9001 requirements.
Along with implementing planned employee training, we use both internal audits and examinations by external audit
organizations to help us continually improve and increase our level.

■Lanolin and cholesterol

Nippon Fine Chemical has a strong focus
on research and development of raw materials
for cosmetics that use plant-derived raw
materials, and already provides a large
number of such products.
In particular, our products made using
palm oil obtained RSPO certiﬁcation in June
2020, certifying their sustainable production
and use, and we are working on increasing
the number of compliant products.

Lanolin is a natural oil obtained by purifying
wool grease, the lipid components adhering
to wool. It is made from the wool shornfrom sheep each year, and does not harm
animals. Nippon Fine Chemical provides
lanolin products, which are renewable andsustainable, to a range of customers.
Nippon Fine Chemical s
lanolin mascots

Management Storategy

Nippon Fine Chemical works unceasingly to prepare and strengthen our company-wide quality assurance system sothat we can provide top-quality products that will satisfy our customers.

■RSPO certiﬁcation

Top Message

Basic Ideas

In the ﬁelds of pharmaceuticals and pharmaceutical intermediates, we assure quality by complying with GMP (Goodhigh quality assurance systems, providing high-quality products into the future.

Development of non-GMO products

Activities for product safety
Nippon Fine Chemical prepares product safety data sheets (SDSs) in accordance with the Japanese Industrial
Standards (JIS). In addition, for products that include substances covered by the labeling requirements of theIndustrial Safety and Health Act, we use the Globally Harmonized System of Classiﬁcation and Labelling of
information.
To enhance the contents of these SDSs, in April 2021 we started operating our new chemical substancesmanagement system and are expanding it to all our products.

We are focusing on the development ofenvironmentally-friendly products such as
those that do not remain in the environment
even when discarded. People are paying
close attention to the environmental impactof plastic waste. Scrubbing agents that areused as skin cleansers to remove dirt andexcess sebum from the skin are made withamides rather than plastics. We also develop
highly biodegradable products made using
phospholipids from natural sources.

As progress is being made on developing
products that use plant-derived raw materials
as a way to bring about a sustainable society,
we are actively working on the developmentof non-GMO products from a desire to ensure
environmental and biological safety. We areswitching existing products to non-GMO
equivalents, and promoting the developmentof new products that take non-GMO into
account.

We strive to ensure our management of chemical substances is done safely: we actively work to comply with the

Sustainability

Chemicals (GHS), and show the GHS picture on labels as needed, providing our customers with safety and hazard

Development of readily biodegradable products

Business Content

Manufacturing Practice, a quality assurance system for pharmaceuticals) standards. We shall continue to maintain thesevarious laws and regulations on chemical products in countries around the world, Japan included, and to ensure

Development of materials for use in perovskite solar cells (next-generation solar cells)

management of chemical products throughout our supply chain.

an Intellectual Property Oversight Committee,
which works with the various R&D departments

Ration of held patents by ﬁeld
(FY2022)

Patent application/patents held numbers

At Nippon Fine Chemical, we have established
Applications
40

Held
80

60

20

40

10

20

total of 75 patent applications over the ﬁve years
between FY2022 and the end of FY2026. Our
patent applications for FY2022 can be seen in
the ﬁgure to the right. In the ﬁelds of beauty care,health care, and ﬁne chemicals, we apply for thepatents, trademarks, and so on needed to expand
those businesses in a timely manner, expanding

N

N

OMe

MeO

N

N

OMe

OMe

OMe

The MATSURI environmentally-sustainable industrial creation projectmateriality (key issues) KPIs (Key Performance
Indicators), we have announced a target of a

MeO

0

0
FY2021

FY2022

Overseas (PCT) applications● Beauty care

Domestic applications● Health careNo. held● Fine chemicals

We are an industry-structuring partner with MATSURI, which is a project to create
environmentally-sustainable industries based on algae, run by Chitose Laboratory
Corp. MATSURI is a project that brings together companies to create new industries
that utilize algae in order to bring about a carbon-neutral society. In promoting thesearch and evaluation of algae-based materials and the development and sale ofalgae-based materials and products such as sustainable raw materials for cosmetics
or distinctive chemical products, we will provide values that support the health and beautyof people, and prosperous lifestyles, with the goal of being a vital part of society.

Non-financial Data

30

OMe

Spiro-MeOTAD

to propose and execute strategies related tointellectual property. In addition, as one of our

OMe

Financial Data

Initiatives for intellectual property

The worldʼs attention has recently turned to perovskite solar cells, seeing them asnext-generation solar cells that could provide both high energy generation efﬁciency
and low manufacturing costs. They are expected to be used for multiple applications
due to being thin, light, and very ﬂexible, nor requiring as much installation space asolder types.
Nippon Fine Chemical is working on initiatives for the development andcommercialization of Spiro-MeOTAD, which is used in perovskite solar cells.

our rights.
35

36

■ Compliance and Labor Environment
Labor environment

The Nippon Fine Chemical Group positions compliance as one of our most
crucial issues. To ensure compliance, we have established our Code of Ethics,
which is made up of our Corporate Code of Conduct, laying out the universal
ideas and is the code of conduct to ensure all ofﬁcers and employees working
at NFC put into practice our Management Philosophy, and our Corporate
Standards of Conduct, which presents how we should act in order to practice
In addition, we distribute a handbook on Code of Ethics to all ofﬁcers andemployees, and get them to read this when they join the company and annually thereafter. This is one of the ways in which

Basic ideas
Nippon Fine Chemical considers our basic safety policy to be continuing to operate free of accidents or disasters,
ensuring the safety of our employees and the local communities, clarifying product properties and handling
methods, and protecting the health and safety of all people using our products, including our customers, and tothat end, we are engaged in the following activities.

Initiatives for safety and peace of mind

we carry out continual education to ensure that what the Nippon Fine Chemical Group thinks is normal does not stray from

Initiatives for security and accident prevention

what society thinks is normal.

Fostering an awareness of compliance

Whistle-blower system
The Nippon Fine Chemical Group has an internal

compliance and ethics to fostering an awareness ofwhistle-blower system in the event anyone discovers

compliance among ofﬁcers and employees.

compliance violations or suspicious actions. In order- Ethics education during on-boarding training

to maintain and operate a sound whistle-blowing- Listing cases of compliance violations on thesystem, the Ethics Committee, Internal Audit Ofﬁce

internal intranet (quarterly)- Workplace discussions on cases of
non-compliance (biannually)

We hold evacuation drills and ﬁre prevention drills

Nippon Fine Chemical is formulating and developing

every year to ensure quick and smooth initial responsesa system for operating a business continuity plan (BCP),

to emergencies such as major earthquakes or ﬁres. In

one that prioritizes the safety of our employees andaddition, we also hold planned drills that assume atheir families, in order to minimize the effects on ourleak of combustible raw material or solvent, etc. on

stakeholders and reduce the long-term impact of athe premises to ensure its impact can be kept to abusiness stoppage even when business continuance isminimum.

difﬁcult due to large-scale disasters such as major
earthquakes or epidemics.

and auditors work together to protect whistle-blowers
and those who talk with us, investigate the facts ofLost-time accidents

their reports, and take corrective measures.

Relations with suppliers
Nippon Fine Chemical has established the basicpurchasing policy shown to the right, and the Flow up

accidents requiring at least one day of leave that happened■Basic purchasing policy
We welcome domestic and international businesswebsite.

partners in pursuit of equal opportunity, and deal

complying with the relevant laws and regulations, we

fairly and justly with all customers.
(2)Economic rationality
When selecting and evaluating business partners,

around the world, in the name of equal opportunities. In

we assess quality, delivery time, price, service,addition, our purchasing activities are done with anreliability, safety, etc. in a comprehensive manner.

awareness not just of economic rationality in theselection of items, but green procurement as well.

(3)Legal compliance and rejection of antisocialorganizations
We comply with relevant laws and their spirit in thecourse of purchase transactions.

(4)Green procurement
protection and environmental protection in the selectionof purchases.

(5)Promotion of CSR procurement37

on health and safety, and we are working to strengthen
the safety management system for plants.

RECPY activities
At our plants, Nippon Fine Chemical carries out
environmental beautiﬁcation (safety) and productivity
improvement through RECPY activities. Improvements
are done using small-group activities, and each group

In parallel with investigating the causes of workplace
accidents and studying countermeasures, we will carryout safety education that goes back to the basics,
working to eradicate workplace accidents.
These efforts have helped ensure that, as of the endof September 2023, there have been no accidents

reports on what it has done. We are working tocausing lost time.

continuously improve the work environment by■Lost-time accident rate

recognizing outstanding activities.
*This stands for “REformation of Clean and ProductivitY” and refers
to activities carried out by the company with the aim of improving
company beautification and productivity.

Internal proposals
Nippon Fine Chemical makes improvements by

We strive to fulﬁll our social responsibilities by working

having employees offer proposals for methods toon CSR throughout the supply chain, including business

improve daily task efﬁciency or improve hidden risks

partners involved in our business activities, promoting

through their ideas and creativity as they carry out

CSR procurement.

their work.

January - September

CY2020CY2021

CY2022NIPPON FINE
CHEMICAL

0.00

8.35

6.36

0.00

All
industries

1.95

2.09

2.06

−

Chemicals
industry

0.93

1.07

1.16

−

2023

Lost-time accident rate = 1,000,000 x (number of lost-time accident
victims) / (total hours worked)
Nippon Fine Chemical: aggregate of lost-time accidents
requiring at least one day off
Statistics from: January to December
All industries/Chemicals industry: Taken from the occupational accident
statistics on the Workplace Safety Website.

Non-financial Data

We conduct purchasing operations based on resource

BCP evacuation drill (held at Takasago Plant, Jan 11, 2023)

Financial Data

open our gates widely to all suppliers, both in Japan and

Plant and the Kakogawa-higashi Plant to work full-time(1)Equal opportunities / fairness / justiceto the Transaction Start and published them on our
In line with our basic policy for purchasing, whilein 2021, safety supervisors were stationed at the Takasago

Sustainability

Three workplace accidents requiring at least one dayof leave happened in 2022. Following the ﬁve workplace

Business Content

Nippon Fine Chemical carries out training on

Business Continuity Plan (BCP)

Management Storategy

the Corporate Code of Conduct in the workplace.

Top Message

Compliance38

FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021Top Message■ Outline of Consolidated Financials Over the Last Decade
FY2022

Profit and Loss (MY)25,86525,86725,153

27,598​28,084​29,047​30,50933,44836,838​Operating profit

1,584

2,094​

2,383

2,369

2,749

3,199

3,641

3,939

4,881

5,057

Ordinary profit

1,907

2,307

2,611​

2,560

2,902

3,503

3,920

4,154

5,127

5,389

Profit attributable to owners of parent

1,129

1,422

1,799

1,815

2,014

2,303

2,621

2,758

3,472​

4,079

Total assets

33,86036,841​37,924​40,066

46,11848,21447,56153,26554,80756,672Equity26,674​29,74830,73332,84636,44937,09337,74942,11643,73245,266​

1,943

3,038​

2,070

2,851

3,626

3,434

3,061

4,698

2,285

1,439

Cash flows from investing activities557​△ 348​△ 1,081△ 1,135

△ 541

△ 598

△ 1,817​△ 2,418△ 2,741​△ 1,779​

Cash flows from financing activities△ 512​

△ 561

△ 593

△ 621

△ 609

△ 741

△ 894

△ 874

△ 1,399△ 3,320​

Cash and cash equivalents at end of period

3,208

5,417

5,766

6,837

9,329

11,411​

11,72013,187

11,4107,766​

487

348​

1,552​

991

699

1,379

1,676

2,228

2,716

2,575

Depreciation

1,122

1,017

1,003​

1,028

976

1,107

1,205

1,064

1,070

950​

R&D expenses

466

467​

535

555

609

675

717

712

824

893

Financial status (financial year-end data, MY)

Cash flow (MY)Cash flows from operating activities

Other (MY)Capital investment amount (tangible)

Business Content

24,528

Management Storategy

Net sales

Indices
6.5​

8.1

9.2

9.4

10.0​

11.4

12.5

12.9

14.6

13.7

4.4

5.1

6.1

5.8

5.9

6.3

7.0​

6.9

8.1​

9.2​

Equity-to-asset ratio (%)

78.8​

78.6​

79.2​

80.3

77.5

76.9

79.4

79.1

79.8

79.9

Net income per share (JPY)47.57​

59.88

75.76

76.45

84.83

96.98

110.37116.17146.32174.42

Net assets per share (JPY)

1,123.17

1,219.50

1,263.99

1,354.12

1,504.66​

1,562.03

1,589.64

1,773.54

1,851.84

1,984.58​

Dividends per share (JPY/year)

21

23

23

28

30​

33

35​

54

57​

42.0

35.1

30.4

30.1

33.0

30.9

29.9

30.1

36.9​

32.7

Overseas sales ratio (%)

22.3​

24.6

22.3​

20.1​

21.8

20.2​

21.9​

21.4

24.8

25.2

Number of employees (persons)

581​

583

585

594

606

631

665

671

684

717

17,869​19,07918,551

17,772​

19,931

20,323

20,573

19,306

23,601

27,184

971​

1,472

1,708

1,659​

1,956

2,401

2,748

2,293

3,622

3,959

Performance by business segment (MY)Industrial
products businessNet sales
Operating profit
Operating profit ratio (％)

Householdproducts business

Real estate

7.7

9.2

9.3

9.8

11.8

13.4

11.9

15.3

14.6

5,737​

6,246

6,438​

6,606

6,686

7,337

10,070

8,646

8,272

Operating profit

492

446

494

519

522

540

620​

1,423

928

675

Operating profit ratio (％)

8.7

7.8

7.9

8.1​

7.9

8.1

8.4

14.1

10.7

8.2

Net sales

362

396​

389

Operating profit

111

113

142

Operating profit ratio (％)

30.8

28.6​

36.6

Net sales

620

654​

682​

944

1,062

1,075

1,137

1,134

1,201

1,382

Operating profit

10

64​

39

192​

271

259

274

223

333

424

Operating profit ratio (％)
Totalbusiness segment has been incorporated under Other as of FY2016

1.7​

9.8

5.7​

20.3

25.5

24.0

24.1

19.7​

27.7

30.6

Net sales

24,52825,86525,86725,153

27,59828,08429,04730,50933,448​36,838Operating profit

1,584​

2,094​

2,383

2,369​

2,749

3,199

3,641

3,939

4,881

5,057

6.5

8.1

9.2

9.4

10.0

11.4

12.5

12.9

14.6​

13.7

Operating profit ratio (％)

39*The real estateNon-financial Data

Other

5.4
5,679​Net sales

Financial Data

20

Dividend payout ratio (consolidated) (%)

Sustainability

Operating profit ratio (％)
Return on equity (ROE) (%)

40

Consolidated balance sheet

Consolidated statement of income and comprehensive income(Unit: Millions of JPY)

(Unit: Millions of JPY)

Previous consolidated Current consolidated
fiscal year
fiscal year

Previous consolidated Current consolidated
fiscal year
fiscal year

(March 31, 2022)(March 31, 2023)​(March 31, 2022)

Current liabilities

Cash and deposits

12,862​

8,937​

Notes and accounts receivable- trade

Notes and accounts receivable- trade

8,703

8,855

Accounts payable - other

3,928

4,256​

757

839

Merchandise and finished goods

3,087​

4,001

Income taxes payable

985

607

Work in process

2,116

2,290​

Provision for bonuses

778

717

Other

Total current assets

3,216

4,718​

Provision for bonuses for directors (and other officers)

92

79

239

788

Provision for environmental measures

61

－

△2​

△0

30,22429,590​

459

Other

646

655

7,611​

7,615

Non-current liabilities

Property, plant and equipment

Accumulated depreciation

362

Total current liabilities

Non-current assets

Buildings and structures

Accounts payable - facilities

11,548

14,960

Deferred tax liabilities

2,267

2,655

△8,043△8,223​

Provision for environmental measures

117

－​

Previous consolidated fiscal year

Current consolidated fiscal year

(from April 1, 2021 to March 31, 2022)(from April 1, 2022 to March 31, 2023)

Net sales

33,448​36,838​

Cost of sales

23,17025,882Gross profit

10,278

10,956​

Selling, general and administrative expenses

5,396

5,899​

Operating profit

4,881

5,057

Non-operating income
Interest income

29

34

Dividend income

235​

297​

Miscellaneous income

38

41​

Total non-operating income

303

373

Interest expenses

11Foreign exchange losses

56

22

Miscellaneous losses

0​17

Non-operating expenses

Total non-operating expenses

Ordinary profit

58​

40

5,127

5,389

37

81

Buildings and structures, net

3,505

6,737​

Retirement benefit liability

111

144​

Machinery, equipment and vehicles

14,35914,401​Long-term accounts payable - other

15​

15​

Gain on sale of non-current assets

Accumulated depreciation△13,043△13,115​

Long-term guarantee deposits

103

102​

Gain on sale of investment securities

0212

Machinery, equipment and vehicles, net

1,315

1,285

Asset retirement obligations

9

9

Total extraordinary income

37​

294​

Land

3,644​

3,719

Other

11​

27​

Construction in progress

3,775

1,794

Total non-current liabilities

2,635​

2,955

Loss on retirement of non-current assets

54

24​

Other

3,312

3,535

10,247

10,571

Impairment losses

89－△2,780△2,845​

Loss on sale of investment securities

2

16

532

690​

12,772

14,227307​

521

Other, net
Total property, plant and equipment

Investments and other assets
Investment securities

Net assets

Total extraordinary losses

Shareholders’equity
Share capital

5,933​

5,933

Capital surplus

6,803​

6,821

11,20512,017​Retirement benefit assets

26

67

Retained earnings

25,79028,513

Other

271

247​

Treasury shares△1,296△3,171

11,503

12,332​

Total shareholders’equity

37,23038,097​

24,58327,081

Accumulated other comprehensive income

Total investments and other assets
Total non-current assets

Total assets

54,80756,672Extraordinary losses

147

40

Profit before income taxes

5,017

5,643

Income taxes - current

1,444

1,383

9

94

Total income taxes

1,454

1,477​

Profit3,562

4,165​

3,472

4,079​

90​

85

Income taxes - deferred

Profit attributable toProfit attributable to owners of parent
Profit attributable to non-controlling interests

Valuation difference on available-for-sale securities

5,784

6,469

Deferred gains or losses on hedges

34​

3

Other comprehensive income
Valuation difference on available-for-sale securities

684

29

△34​

Foreign currency translation adjustment

675​

697

Remeasurements of defined benefit plans

6△1

Foreign currency translation adjustment

406​

29

Remeasurements of defined benefit plans

9​

△7​

6,501​

7,169

Non-controlling interests

828

834

44,560​46,10154,80756,672

Total net assets

Total liabilities andnet assets

Total other comprehensive income

△444

671

3,118

4,836

Comprehensive income attributable to owners of parent

2,927

4,747​

Comprehensive income attributable to non-controlling interests

190​

89

Comprehensive income
Comprehensive income attributable toNon-financial Data

△890

Deferred gains or losses on hedges

Total accumulated other comprehensive income

Financial Data

Intangible assets

Total liabilities

Extraordinary income

Sustainability

Accumulated depreciation

Business Content

Allowance for doubtful accounts

41(March 31, 2023)​

Liabilities

Current assets(Unit: Millions of JPY)Management Storategy

AssetsRaw materials and supplies

Top Message■ Financial Statements

42

Top Message

Consolidated statement of changes in shareholders' equity

Consolidated statement of cash flows■Previous consolidated fiscal year (from April 1, 2021 to March 31, 2022) (Unit: Millions of JPY)

(Unit: Millions of JPY)

Shareholders’equity
Share capital

5,933

Retained earnings

6,803​

Treasury shares

23,358​

Total shareholders’equity△1,025​35,069​Changes during period
Dividends of surplus△1,032

Profit attributable to owners of parent
Purchase of treasury shares△271​

Employee welfare benefit fund△7

Balance at end of period

5,643

3,472​

1,070​

950​

△271​

Impairment losses

89－

Increase (decrease) in allowance for doubtful accounts

1​

△1

－​

－​

2,432​△271​

2,160​

5,933​

6,803

25,790​△1,296​37,230​

Valuation difference on
available-for-sale securities

Deferred gains orlosses on hedges

Foreign currencytranslation adjustment

Remeasurements ofdefined benefit plans

Total accumulated othercomprehensive income

Noncontrollinginterests

Total net
assets6,675​

7​

365​

△3

7,046​

730​

42,846​

Changes during period
Dividends of surplus△1,032​

Profit attributable to owners of parent

3,472​

Purchase of treasury shares△271​

Employee welfare benefit fund△7​

Net changes in items other than shareholders' equity

26​

310

9

△544

97

△447

△890​

26​

310​

9​

△544​

97​

1,713​

Balance at end of period

5,784​

34​

675​

6​

6,501​

828​

44,560​■Current consolidated fiscal year (from April 1, 2022 to March 31, 2023)

(Unit: Millions of JPY)​

Balance at beginning of period

Capital surplus

5,933

Retained earnings

6,803​

Treasury shares

25,790​Total shareholders’equity△1,296​37,230​Changes during period
Dividends of surplus
Profit attributable to owners of parent△1,346​△1,346​

4,079​

4,079​

Purchase of treasury shares△1,88518​△1,885

11​

Employee welfare benefit fund

Balance at end of period

Balance at beginning of period

6,501

Noncontrollinginterests
828

43

4​

△0​

△62​

361​

Other

△38

△757​

Subtotal

3,207​

2,864​

Interest and dividends received

265​

331​

Interest paid

△1​

△1

△1,185​△1,756​2,285

1,439​△96－​

Net cash provided by (used in) operating activities

Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits

－​

290

Purchase of property, plant and equipment△2,813​△2,606​△2,741△1,779Total net
assetsNet cash provided by (used in) investing activities

Cash flows from financing activities△1,032​△1,346

Dividends paid to non-controlling interests

△90​

△79​

Purchase of treasury shares△271​△1,885​△4△8​△1,399△3,320​Effect of exchange rate change on cash and cash equivalents

78​

16​

△10

Net increase (decrease) in cash and cash equivalents△1,776​△3,644

Cash and cash equivalents at beginning of period

13,187

11,410Cash and cash equivalents at end of period

11,410​7,766​

44,5604,079​

Purchase of treasury shares△1,885

Disposal of treasury shares

29

Employee welfare benefit fund△147
△2,586​△1△1,346

Profit attributable to owners of parent

Balance at end of period

Increase (decrease) in guarantee deposits received
Increase (decrease) in trade payables△757​△1,816​

684

△31

22

△7

667

6​

674

684​

△31

22

△7​

667​

6​

1,540

6,469

3​

697​

△1

7,169​

834

46,101​Dividends paid

Other
Net cash provided by (used in) investing activities

Non-financial Data

Dividends of surplus

Net changes in items other than shareholders' equity

Decrease (increase) in inventories

401​

Changes during period

Total changes during period

Decrease (increase) in trade receivables

40​

38,097​

6​

△57​

△1

△3,171​

675

△195​

Purchase of investment securities
28,51334​

2
17

Proceeds from sale of investment securities

6,821

5,784​

Loss (gain) on sales of investment securities
Loss (gain) on sale and retirement of property, plant and equipment

286

5,933

Total accumulated othercomprehensive income

△6​

△150

866

Remeasurements ofdefined benefit plans△8

Foreign exchange losses (gains)143△1,874​Foreign currencytranslation adjustment

1​

△14​

2,722​

Deferred gains orlosses on hedges

△331

1

Proceeds from sale of property, plant and equipment

18​

Valuation difference on
available-for-sale securities△265

Purchase of intangible assets－​

Accumulated other comprehensive income

Interest and dividend income
Interest expenses

△10​

29​

△10​

Net changes in items other than shareholders' equity

Total changes during period△40​

Financial Data

Disposal of treasury shares

33

△26​

Income taxes paid

Shareholders’equity
Share capital△20​

Decrease (increase) in retirement benefit assets

Sustainability△890​

Total changes during period

Increase (decrease) in retirement benefit liability

Business Content

Balance at beginning of period

Cash flows from operating activities
5,017

△7

Accumulated other comprehensive income(from April 1, 2022 to March 31, 2023)

Depreciation

Net changes in items other than shareholders' equity

Total changes during period

Current consolidated fiscal year

(from April 1, 2021 to March 31, 2022)

Profit before income taxes△1,032

3,472

Previous consolidated fiscal year

Management Storategy

Balance at beginning of period

Capital surplus

44

Top Message■ Human Resources Information■Employees■Lost-time accident rate
Indices

FY2020

FY2021

FY2022

CY2014

CY2015

CY2016

CY2017

CY2018CY2019CY2020CY2021

CY2022

CY2023January-September

416 persons

NipponFine
Chemical

4.55

0.00​

2.31

2.15​

2.08

0.00

1.87

0.00​

8.35

6.36

0.00

１５．
６%

１５．
８%​

１６．
６%​

All
industries

1.58​

1.66​

1.61

1.63​

1.66​

1.83​

1.80

1.95

2.09​

2.06

−

40.1 years old/
13.8 years

40.0 years old/
13.5 years

39.6 years old/
12.7 years

Chemicals
industry

0.82​

0.76​

0.81

0.88

0.81

0.90​

0.94​

0.93

1.07

1.16​

−

Percentage of females in management positions

０．
０%

０．
０%

０．
０%

Percentage of females in management positions and candidates
for management positions among full-time employees

４．
４%

６．
０%

７．
０%

Percentage of female employees
Average age/average years of service of full-time
employees■Recruitment/Promotion to full-time employee
Indices

FY2020

FY2021

FY2022

１９．
４%

２３．
５%

２６．
８%

Percentage of female employed as full-time employees

１４．
７%​

１６．
１%​

１８．
６%​

Ratio of mid-career employees among full-time employees

７３．
５%​

７７．
４%​

８１．
４%​

Number of people promoted from contract employees tofull-time employees

1 person1 person

2 persons

Number of dispatch employees promoted to full-time
employees

2 persons

0 person1 personIndices

FY2021

FY2022

1,969.15 hours

1,991.02 hours

1,979.38 hours

15.34 hours

18.70 hours

18.96 hours

Number of paid leave days taken per person per year
Annual paid leave take-up rate per person

１１．
５ days​
６７．
６%​

１２．
１ days​
７３．
０%​

１３．
６ days​８２．
４%Number of people taking childcare leave (male/female)0 person/2 persons

0 person/1 person

4 persons/2 persons

Number of people taking nursing care leave (male/female)0 person/0 person

0 person/0 person

1 person/0 person

Total actual working hours per person per year

Average overtime hours per monthNon-financial Data

FY2020Financial Data

■Work-life balance

Sustainability

Percentage of female employees

Lost-time accident rate = 1,000,000 x (number of lost-time accident victims) / (total hours worked)
Nippon Fine Chemical: aggregate of lost-time accidents requiring at least one day off
Statistics from: January to December
All industries/Chemicals industry: Taken from the occupational accident statistics on the Workplace Safety Website.

Business Content

386 persons

Management Storategy

372 persons

Number of employees

45

CY201346

Top Message■ Safety and Environment Information■Amountof waterused■Amountof waterused■Amountof waste■Amountof wastewater water■Amountof energy
used■Amountof energy
used■Wasteamounts
and recirculation
rate■Wasteamounts
and recirculation
rate(1,000 t)
1,000(1,000 t)
1,000(10,000 GJ)
60.0(Unit: tons)
4,000

800

800

3,500
3,000
2,500

600

2,000

30.0
400

400

1,000

200

10.0

0

0
2013

2014

2015

Tap water

2016

2017

2018

Well water

2019

2020

2021

2022
(FY)

500

0.0
1995

2013

2014

2015

2016

2017

Release into public rivers

Industrial-use water

2018

2019

2020

2021

25

0

2022
(FY)

1995

Release into sewerage system

2013

2014

2015

2016

Fuels

2017

2018

2019

2020

2021

2022
(FY)

Electricity

1995

2013

2014

2015

Industrial waste

2016

2017

2018

2019

2020

2021

0
2022
(FY)

Specially-controlled industrial waste

Recirculation rate

Recycling rate

Recirculation rate: (Amount of recycled materials) / (Totalamount of industrial waste generated)■SOxemissions■SOxandandNOx NOx
emissions(Unit: tons)
20.0

■PRTR
transfer■PRTR
transferamount,amount,emissions emissions■GHG
emissionsGHG
emissions(Unit: tons)
250.0(Unit: tons)
30,000Recycling rate: (Amount of recycled materials + Amount ofvaluable resources) / (Total amount of industrial waste +(%)
140

22,500

100

150.0
80

10.0

15,000
100.0

5.0

60

50.0

Amount of valuable resources)

Sustainability

120

200.0
15.0

Business Content

1995

50

1,500

20.0
200

75

Management Storategy

50.0

40.0
600

(%)
100

40

7,500

20
0.0
1995

2013

2014

2015

2016

2017

SOx

2018

2019

2020

2021

2022
(FY)

2013

2014

2015

2016

2017

2018

PRTR atmospheric emissions

NOx

2019

2020

2021

2022
(FY)

PRTR transfer amount001995 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
(FY)

Scope 1Compared to FY1995

Scope 2Compared to FY2013

Financial Data

0.0

■Changes in chemical substances with large amounts of atmospheric emissions​ (Unit: tons)​
FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Toluene

16.2

14.6​

8.2

13.4​

17.4​

22.7

31.5

18.1

23.2

26.1​

Chloroform

1.5​

3.7​

1.4

0.4

0.5

0.3​

2.6

5.2

4.0

2.5​

Chlorodifluoromethane

0.0

3.3​

0.0

4.2​

0.0​

8.4

1.7​

0.0

0.0​

0.0​

Dichloromethane

0.7​

2.7​

0.1​

4.2

0.5​

6.9

2.2​

0.4​

0.0​

0.3​

Non-financial Data

47

FY201348

Smiles on Faces:
The Power of KIREI

変換アダプタEditorial Policy
Previously, Nippon Fine Chemical has issued separate RC Reports, CSR Reports, andSustainability Reports, but from this business year, we are merging these all into one
integrated report. This report includes management strategies, a business overview,ﬁnancial information, environmental, social, and governance information, and so on.
We hope to take this opportunity to pass on to as many stakeholders as possible
our efforts to improve our corporate value as well as give an overall picture, sothat they will take an interest in our company.
Period Covered
FY2022 (April 2022 to March 2023)
Some data from FY2023 has also been included.

USBケーブル

Scope
The primary information is regarding Nippon Fine Chemical alone. Within the fourmain business segments, the hygiene ﬁeld is handled by Arbos Co., Ltd., a Group
company, so this ﬁeld has been omitted from the introduction to the individual ﬁelds
in this report. In addition, it contains some information from Group companies
covered by consolidation (Value Creation Stories, medium-term management planbusinesses [Portfolio, Management Targets and Capital Policies], Nippon Fine ChemicalGroup businesses, and ﬁnancial information). (as of March 31, 2023)

Date of Issue
March 2024
Guidelines Used for Reference“International Integrated Reporting Framework,” International Integrated Reporting
Council (IIRC)“Environmental Reporting Guidelines,” Ministry of the Environment
Published Information about Nippon Fine Chemical
Basic information about Nippon Fine Chemical is published on our website.
■Nippon Fine Chemical website
https://www.nipponseika.co.jp/en/■TCFD Reporthttps://www.nipponseika.co.jp/en/sustainability/report/■Securities Reporthttps://www.nipponseika.co.jp/investors/securities/
Note regarding forecasts
This report not only describes the past and current status of the Company,
including certain Group companies, but also includes future projections and plans
based on currently available information. These results may differ or change due
to various factors such as changes to the business environment.

Phytopresome, Presome, Phytocompo, PrimeLipid, Neosolue, Plandool, LUSPLAN, FineNeo, NanoRepair, Tremoist, Neutron, Ecolano, LanoAce,and "Smile on Faces; The KIREI power of the Phospholipids, by Nippon Fine Chemical." are registered trademarks of Nippon Fine Chemical Co., Ltd. in Japan.