TDK CSR REPORT 2014
English version

TDK Corporation
Shibaura Renasite Tower,
3-9-1 Shibaura, Minato-ku, Tokyo 108-0023
CSR Promotion Office
TEL : +81-3-6852-7115
http://www.global.tdk.com/

TDK CSR REPORT 2014
English version

Top Commitment
Building on TDK’s Roots in Magnetic Technology
to Contribute Towards Solutions for Challenges
Facing Modern Society

Helping to find future-oriented solutions tosocial issues

information that they need.

Next year, TDK will celebrate the 80th anniversary of thematerials and parts for our own products, which in turn arecompany’s founding. At this important milestone, we will be

supplied to manufacturers of end products, we place great

renewing our firm commitment to positively engage with animportance on implementing a firm CSR stance over the en-

ever changing world and to do our best in contributing to findtire supply chain. We are therefore actively engaged in ef-

solutions to pressing issues in various fields of life.

forts to help solve the problem of conflict minerals. Not only

Furthermore, as a “mid-stream” enterprise that sources

Looking at the environment for example, we aim to create

through activities of our own group but also through indus-

highly energy-efficient products that will help society at large

try channels such as the Japan Electronics and Information

to save energy. We also believe that we have an important

Technology Industries Association (JEITA), we do our utmost

mission in providing electronic components that play a cru-

to eliminate minerals from the supply chain that are linked tocial role in storage batteries, thereby contributing to a moreviolations of human rights and are being used to fund groups

widespread utilization of renewable energy sources such asthat commit inhumane acts.

wind power and geothermal power.

commonplace in the near future. This also means a move

In order to accelerate such efforts at contributing to solveaway from the combustion engine to higher reliance on elec-social issues, it is increasingly important to take advantage

tric motors, so that we are seeing a progressive “electroni-of a variety of human resources by actively promoting diver-fication” of the automobile. In view of the aging of society,sity. As both overseas production and overseas marketing

it is also certain that the use of sensor-based functions forbecome more and more substantial, we must reach beyond

preventing accidents will become more prevalent and willborders and pursue overseas recruitment with renewed zeal.

create new market needs. As a manufacturer of electronic

Nationality, race, and gender are no longer a factor, as wecomponents, we have an important role to play in supporting

intend to swiftly establish a framework and hiring policies

and enabling such changes.

that are geared towards discovering and fostering human

Another field where dramatic technological innovation

Top Commitment

Top Commitment

hybrids and electric vehicles are expected to become more

Becoming an organization drawing on the
power of human resources

In the field of automobiles, eco-friendly cars including

resources based on performance and abilities.

will take place against the background of the aging society ishealth care and nursing. This may even extend to the use ofContinuing to meet challenges

robots to help in performing nursing tasks and the develop-

At the beginning of our company’s history almost 80 years

ment of wearable devices designed to compensate for bodily

ago stood the commercialization of the magnetic material fer-functions that deteriorate with advancing age. By developing

rite. Coming from these roots and building on our strengths,

products and components in this sector, TDK wishes to help

in particular with magnetic technology, we have branchedraise the quality of life, both for aged or disabled persons

into various fields, offering products in a timely manner andthemselves as well as for their carers and society in general.

aiming to be of use to society. This spirit which can be seen
as our company’s DNA is still going strong and will guide us

Towards a fully connected world

also in the future.

The possible widening of the so-called “digital divide” is a

The move from electronics to spintronics that will expand

problem of serious concern, and the TDK Group has identi-

the possibilities of magnetics is bound to further boost thefied it as another area where we hope to make a positive

potential of the TDK Group as well. Striving to become “thecontribution. The spread of the Internet and a networked in-world’s most powerful technology development group,” wefrastructure are creating a world where it is possible to obtainwill continue to meet the challenges that we encounter along

the same information instantly, regardless of one’s geograph-

the way.

ical location. In this kind of connected society, we must be
careful not to create a gulf between those who have easy access and those who do not, be it due to factors such as age,nationality, place of residence, or economic circumstances.
To this end, we want to develop and supply products that01

TDK CSR REPORT 2014provide high functionality while being practical and afford-

Takehiro Kamigama

able, helping to ensure that everybody can freely access the

President & CEO, TDK Corporation

TDK CSR REPORT 201402

The TDK Group in the World

Name: TDK Corporation

Since the company’s founding in 1935, TDK’s business has expanded into various countries and regions around the world. The TDK

Capital: 32,641,976,312 yen

product lineup has also greatly diversified.

(As of March 31, 2014)

Company Profile
Headquarters: 3-9-1 Shibaura,
Minato-ku, Tokyo, Japan

FY2014 Net Sales by Product Segment (by composition)
Other

Film Application Products

19,257 million yen

129,304 million yen(13.1%)(2.0%)

Consolidated
net sales

Established: December 7, 1935

984,525

Magnetic Application
Products

million yen

364,291 million yen

Passive Components

471,673 million yen(47.9%)(37.0%)

Remaining an important player on the world stage, TDK aims to keep delivering services and products that fulfill the needs of society.

EuropeNumber of TDK Group
employees

Japan

83,581

Consolidated subsidiaries

116

Number of employees

Net sales

Number of employees
Consolidated subsidiaries

139,716 million yen (14.2%)

Net sales

Americas

Number of employees
Consolidated subsidiaries
Net sales

9,149
13

94,005 million yen (9.5%)

Introduction

The TDK Group in the World

Consolidated subsidiaries

6,658
31

Asia

3,167
17

Number of employees
Consolidated subsidiaries

82,966 million yen (8.4%)

Net sales

64,60755

667,838 million yen (67.9%)

As of March 31, 2014

Topics / Hungary

Topics / U.S.A.
Versatile Functionalities andEnvironmental Friendliness that
TDK Supports in the Evolving U.S.
Automotive Market

03

TDK CSR REPORT 2014

P14

Tech Power of ONE TDK
Sustains Growth of Renewable
EnergyP14

Topics / China
Responses to the
Expectations of Society
Lead to Improved
Corporate Value

Topics / Japan

P17

P19

Identification of Human
Rights Issues throughDialogue with Stakeholders

TDK CSR REPORT 201404

Corporate Philosophy

Corporate
Motto

Corporate
Principles

Editorial Policy

Contribute to culture and industry
through creativity

VisionCourage

Trust

Always take a new step
forward with a visionin mind. Creation andconstruction are not born
without vision.

Always perform withcourage. Performing poweris born by confronting
contradiction andovercoming it.

Always try to build trust.
Trust is born from a spirit ofhonesty and service.

Report Format
The report is available as a booklet and a collection of web site
pages, in slightly different format to match the requirements of
the respective media.
Booklet: A summary version focusing on key CSR action items.
Web site: Compiled with reference to the Global Reporting
Initiative (GRI) guidelines including comprehensive information
centered on fiscal 2014 activity reports as well as detailed data.
(Scheduled to be available in August 2014)

August 29, 2014
(Previous issue: August 2013; next issue: August 2015
[scheduled])

Contact

Period Covered

CSR Promotion Office: +81-3-6852-7115

FY 2014 (April 1, 2013 to March 31, 2014)

Cover Page Design

Web Based CSR Activity Information

TDK Products

Corporate Philosophy

TDK Code of Conduct

Editorial Policy

Representing the lively dynamic and clear-cut sense of
speed of a global business. The motif also hints at thecross-relationship between customers and society, andexpresses the creation of new values.

* TDK Group: TDK Corporation and 116 consolidated subsidiaries in Japan and overseas

2. TDK members shall always be aware of wider issues and pursue the true facts of any
situation.

In an increasingly networked world, the power of craftsmanship, which is a core strength of TDK, provides advantages
when it comes to realizing the goals, such as making mobile devices more compact and versatile, or enabling data
centers to store more data while consuming less energy.

Date of the Report’s Issue

TDK Group*

1. TDK members shall respect the character and individuality of each employee and pay
heed to values and opinions that differ from those of the TDK Group.

ICT (Information and Communication Technology)

None

Organizations Covered

TDK Code of Conduct
Handbook

Information about fiscal 2014 is provided in a comprehensive format centered on
various activity reports.
We hope that you will find it interesting reading, and we heartily welcome your frankcomments and suggestions via the accompanying questionnaire.

3. TDK members shall be active, courageous, and tenacious in efforts to resolve social
issues.
4. TDK members shall pursue work creatively as members of a manufacturing company.

CSR Web Site

http://www.global.tdk.com/csr/* Web site with CSR activity information (illustration uses previous year's page)

Highlight 2

Top Commitment.................................................................................................................................01
The TDK Group in the World...............................................................................................................03

Contents

Corporate Philosophy / Editorial Policy / Contents...............................................................................05

How the TDK Group Makes Value Creation Happen
TDK Products.. ................................................................................................................ 07
How the Value Chain Works —Creation process of a SESUB module— ...........................................09
Realizing the Spirit of Monozukuri Around the World......................................................................... 1305

CSR Activities Supporting Value Creation
Social Trends and TDK’s Response.............................................................................................................15
Responses to the Expectations of Society Lead to Improved Corporate Value—Internal CSR Auditor Training—................................................................................................................17
Identification of Human Rights Issues through Dialogue with Stakeholders................................................19

Highlight 1

TDK CSR REPORT 2014

Activity Report

How the TDK GroupTDK products play a vital role in many useful items of daily life.

Major Organizational Changes During
the Covered Period* Some information covers activities outside this period.

The members of the TDK Group will autonomously practice the following action guidelines in
the course of their daily work:

Highlight 1

Each year, TDK’s CSR Report is published in two media formats, as a booklet and on the web site, with the purpose of giving
stakeholders an understanding of the TDK Group’s CSR (Corporate Social Responsibility) activities. The 2014 edition was created to provide answers to questions such as “What kind of values does the TDK Group create for society?” and “How does
the company meet its responsibilities and support value creation by identifying problems in the supply chain?”
The report also provides information about the progress made during fiscal 2014 with regard to important activity areasfrom a CSR perspective, and activities for different stakeholders are introduced in the online version of the report.

n Lithium ion batteriesn Neodymium magnets for VCMs

These rechargeable batteries with high energy density are extensively used in various kinds of mobile devices. Advanced TDK
technology for key components such as electrode materials andseparator materials provides a decisive advantage.
[Main applications]
Smartphones, tablets and other mobile devices

Voice coil motors (VCMs) that drive magnetic heads in harddisk drives use neodymium magnets from TDK. A new material that does not require dysprosium, an extremely scarce rareearth material, has also been developed.
[Main applications]
VCMs in hard disk drives for notebooks, desktop computers, etc.

n Thin film common mode filters

n SESUB

These products combine a common mode filter (highly effective
in suppressing noise without affecting the signal) with a low-capacitance ESD suppressor that protects the circuitry from electrostatic discharge.
[Main applications]
High-speed differential signal interfaces in smartphones, tablets, notebooks, hard disk drives, solid state drives, etc.

This proprietary substrate technology from TDK involves embedding lowered-profile IC chips directly in a multilayer substrate
which allows highly reliable connections between chip terminals
and board wiring. It is implemented in various types of modules
that help to make mobile devices smaller and thinner.
[Main applications]Power supply modules and wireless communication modules, etc. for smartphones, tablets, wearable devices and similar

Cloud Computing

n HDD Headsn Solid State Drives (SSD)(Data Centers)

Hard disk drive (HDD) heads from TDK contribute to the realization of extremely high storage
capacities required by data centers. TDK also
has developed magnetic heads for thermal assisted recording to achieve super high recording
density in the next generation of HDDs.
[Main applications]Servers and storage solutions fordata centers

Data centers are implementing multi-tier storage
systems where frequently accessed data are processed by means of SSDs which feature higher access speeds. SSD products from TDK designed forindustrial use are playing a vital role here as well.
[Main applications]Servers and storage solutions
for data centers

TDK Group’s CSR...........................................................................21

1. Contribution to the World by Technology.............23
2. Development of Human Resources.....................25

3. Society and Environmental Considerations in the
Supply Chain.......................................................28
4. Symbiosis with the Global Environment...............29

Third-Party Opinion......................................................................................................................................30
TDK CSR REPORT 2014

06

07

TDK CSR REPORT 2014

TDK’s SESUB technology makes ultra-compact power management units (PMUs)
and Bluetooth® modules a reality!
By embedding lowered-profile IC chips into the substrate, the SESUB(Semiconductor Embedded in SUBstrate) technique allows the realizationof smaller, high-performance PMUs for smartphones, as well as Bluetooth®
modules with world-leading compact dimensions.

SESUB cross-section view

Features
Smaller parts and lower profile enable
smaller dimensions of the end productwhile contributing to longer battery
life and providing a higher degree of
freedom for design. Further advantages
are improved thermal dissipation andlower noise emission levels.

Always thinking about how to contribute to society
the big picture in mind, from the manufacturing process to the final usage pattern by the customer.
Even when there is a difficult demand
from a customer, I aim to explore various possibilities and try to think of ways
for meeting the requirement that we canpropose to the customer. Unless we takethis approach, we cannot create something that did not exist before. Throughthe use of SESUB technology, we not
only offer products that are convenient

for the customer, but also contribute to
the conservation of resources and reduction of environmental impact. For the future, integration with other technologies
should enable solutions that can further
enhance the benefits to society.
In one’s everyday work, it is easy to getcaught up in the immediate task at hand,
but I believe that it is equally important toalways evaluate whether what we do also
contributes to society at large.

The “Improve quality” approach is a core strength of TDK
How can we package integrated circuits(ICs) in thinner and smaller form factors? How can we machine them without impairing yield? These are some ofthe questions that we ponder when trying to come up with structural solutions
and methods that realize the concepts
worked out by our design and development people in response to customer
requests.
TDK employees share an awarenessof the importance of raising quality. They

know that this must start from the design
stage and be implemented at every stepin the process, rather than only throughfinal inspection. I believe that this is astrong point of TDK. I am keenly awarethat we must prevent problems fromoccurring after the product has left ourfactory and has become part of the customer’s end product. This is even moretrue for SESUB modules which are often
key components for the performanceand characteristics of the end product.

In the past, the development of electric appliances for use in the home freed
humans from various chores, and later
the advent of mobile phones changed
the way people communicate with eachother. In this way, an invention may end
up causing a change in lifestyles orsense of values. I believe that we should
continue to aim for the development of innovative electronic components that help
to bring people closer together.

Reducing waste and helping to conserve resources
Within the SESUB manufacturing process, my work involves embedding IC
chips in the substrate. Because there
are several hundred to several thousandchips embedded on a single panel, thestatus of each chip has to be monitored
in order to precisely position it at the designated location. I operate the IC bonderthat bonds the chips to the substrate.
I always strive to avoid operator errors

09

TDK CSR REPORT 2014

and increase yield in the IC chip embedding process. Increasing yield alsomeans that there is less wasted material, which helps to conserve resources.
Incidentally, the machinery equipmentused in the IC bonding process is proprietary to TDK.
I joined TDK less than a year ago, andam still relying on the kind assistance ofpeople around me who teach and guideme every day. My goal is to quickly become as proficient as they are. I want to
do my best, because I strongly feel thatthe products we make are innovative andare the focus of high expectations bycustomers.

Bluetooth® module—Bluetooth Low Energy—[Main applications]• Smartphones, mobile phones, tablet devices• Digital still cameras, mobile devices

1• Health care products, wearable devices, etc.

Design andDevelopment
Sayuri Terazaki

How the Value Chain
Wo rksSupervisor,
Design Section,
SESUB Business Unit,
Manufacturing Strategy Division,
Thin Film Device Center

Klaus Ruffing
Executive Vice President,
IT/PMU, Embedded Solutions
Systems, Acoustics, Waves
Business Group

6

MarketingIchiro Yaginuma
Supervisor,Marketing Section,
SESUB Business Unit,
Manufacturing Strategy Division,
Thin Film Device Center—Creation process of a SESUB module—
Creating products that match the needs of customers and offer new value to the world-TDK’s
Monozukuri (manufacturing) consists of a numberof and a variety of processes.
How do people working in the lab, on the shop
floor, or in the field see their mission? By way of an
example to illustrate this topic, we introduce theDevelopment

Monozukuri stance of personnel working in various areas of the new Semiconductor Embedded
SUBstrate (SESUB) technology. SESUB is a solution that meets the market’s demands for smaller
dimensions, lower profile, and higher frequency
operation in sectors such as ICT and health care.

Quality
Assurance

Reo Hanada

Kenichi Iwanami

2

Supervisor,
SESUB Development Section,
SESUB Business Unit,
Manufacturing Strategy Division,
Thin Film Device Center

5

Manufacturing
Daiki Takaishi
Manufacturing Section,
SESUB Business Unit,
Manufacturing Strategy Division,
Thin Film Device Center

3

4

A SESUB module features lowered-profile chips embedded in the substrate.
The appeal of such a product is not onlythat it realizes the smallest dimensions
and lowest profile ever, it also offers excellent thermal dissipation and extremely
low power consumption. Furthermore,thanks to their excellent shielding,
SESUB modules emit very low levels ofelectromagnetic interference.

The successful technological development is a result of cooperation between the Japanese SESUB team andour Embedded Solutions team in Munich.
The former’s wide-ranging technology expertise and production know-how,paired with our extensive experience
with high-frequency applications in thearea of smartphones and other mobile
devices, produced a synergy that bestleverages the strengths of both sides.

This product will prove indispensablefor the design of smartphones with further
enhanced capabilities. It is our mission
to bring SESUB products to worldwide
markets, establish the technology as themarket-leading standard for embedding,and thereby realize a major business opportunity. In close collaboration with the
R&D department, we aim to create products with an even stronger competitiveedge.

Serving as a bridge between the development team and customer
Rather than simply trying to expand
sales, I feel that my mission is to act asa kind of antenna, taking both TDK’s
course and the customer’s requirements
into consideration and facilitating the development of actual products.
Since SESUB is still a new technology, customers sometimes come up
with unexpected ideas for applications.
Because we are the point of contact
for the customers of TDK, we continue
to communicate with them also after

product development has begun, and weconvey their opinions to the development
team.
What’s important here are responsiveness, speed, and the readiness to tackle
tasks that others would rather avoid.
Many employees working in marketingat TDK have technical job experience.
Having the skills needed to actuallydesign products is bound to enhancetheir trustworthiness in the eyes of thecustomer.

My aim is to be involved in creating asystem which produces the sense of security that comes from connectedness.
In our current age of longer life expectancy and falling birth rates, the numberof people living alone is on the rise. The
power of electronic devices can create aframework that provides support without
being intrusive, and I would be happy if I
can help in creating such a framework.

Highlight 1

Creation process of a SESUB
moduleMy work involves the realization of characteristics and specifications as envisioned by the customer together withus. I am involved in the process ranging
from deciding on product specifications,through basic design and prototype
manufacture, to finalizing product characteristics and ensuring quality. With
mass production in mind, creating a
product that is easy to manufacture has
an important influence on product quality. Product design always needs to keep

7

SESUB

Sales

Bringing competitive products to the world

Supervisor,
Quality Assurance Section 3,
Quality Assurance Department,
Systems, Acoustics, Waves
Business Group

Production
Technology
Tomohide
Yokozawa
Chief Inspector,
SESUB Process Development
Team,
SESUB Business Unit,
Manufacturing Strategy Division,
Thin Film Device Center

Improving quality management through all stages from design to manufacture
The most important aspect of ensuring
product quality is proper managementof an approach that always asks how
we can prevent the emergence of defective products. Various types of data
are constantly being monitored to verify
that there are no problems in the respective production processes. If a problem
is detected, we provide guidance for
identifying the cause and implementing
suitable countermeasures. In the caseof SESUB, if a chip does not function

properly, the entire product will be useless. Chip damage and connectivity
therefore are two of the aspects that wepay special attention to. Customers increasingly demand a thinner substrateprofile, but we have to evaluate how thismay affect quality. We analyze possible
risks and make sure that the results arereflected in the development process.
Many aspects of the quality of a product are already determined at the design
stage. When TDK designs new products

and manufacturing processes, data areshared extensively among many departments including the design, development, technology, and quality assurance
sections. The design review stage provides a forum for deliberation about how
to create a system that results in stable
quality. In my opinion, this system plays
an important role in maintaining our highquality standards.

Thorough stabilization of quality
Working in production technology means
being involved in the task of designing
production lines. For me, the most satisfying aspect of this work is being able toproduce results such as increasing yieldby coming up with new ideas related,for example, to the development of new
manufacturing methods or selection ofmaterials, and having the customer appreciate the results.
Because SESUB is still a new productcategory, quality stabilization is the foremost goal. When a problem occurs in
a production line, we of course have tolook for the cause and eliminate it, but wealso need to take measures to prevent a
recurrence, and we must constantly verify whether such measures are working
effectively.
The fact that the entire SESUB production line from design to final shipping iscontained within a single factory site is agreat advantage in this respect. It makes
it easy to ensure good communication
between processes and establish a
speedy manufacturing setup. My area of
responsibility is the substrate wiring formation stage. Trying to realize finer wiring
patterns with a view towards cost reduction is the guiding concept of my work.

TDK CSR REPORT 201412

How the TDK Group Creates Value
Hungary

Makes Value Creation Happen

Realizing the Spirit ofMonozukuri Around the World

By pursuing a path of innovation for technologies and products geared to the needs of society, we consistently
create new values.

Automobiles
TDK is making significant contributions to improved performanceand better fuel efficiency in environment-friendly cars such as hybrid electric vehicles (HEV) and electric vehicles (EV), as well as
for self-driving vehicles currently under development.

Craftsmanship in the Monozukuri tradition of TDK is
spreading on a global scale. Harnessing a wealthof proprietary technologies, TDK continues to offer
products that fit the diverse needs of regions aroundthe world.

n Film capacitors
A type of capacitor that uses plastic film as a dielectric. Characterized by high energy density, extended temperature range, high reliability and long
life, they are therefore suitable especially for use inautomotive electronics.
[Main applications]
Inverters for EV/HEV, etc.

U.S.A.

The TDK capacitor lineup for automotive applications comprises hightemperature types that can withstand extreme temperatures up to 150ºC
such as exist in the engine room of a car, metal fitting type terminal (Mega
Cap) and soft electrode types that are resistant to solder cracks causedby thermal shocks as well as mechanical stresses caused byboard flexing, and mid level voltage types for hybrid
and electric vehicles.
[Main applications]
HEV/PHEV/EVs (DC-DC converters, inverters, BMS),
drive train ECUs (engine ECU, ABS, EPS, TCM), safety related ECUs (radar, camera), etc.

TaiwanProducts Developed in Taiwan Tailor-madefor the Increasingly Sophisticated ICT Market
Realizing the dream of having an
independent development base in
Taiwann Current sensors

TDK Taiwan has successfully developed
actuators for camera modules, designed
for realizing autofocus and optical image
stabilizer functions in smartphone cameras. The development and design processof any new product usually has its problems and setbacks, and this project in afield where we initially had no experience
was no exception. At the outset, our levelof knowledge and our technical expertise
were still inadequate, and we sometimes
found ourselves unable to answer specificquestions from customers. But in consultation with customers and aiming for a
product with features not available fromthe competition, we were able to overcome the initial difficulties, and our persistent marketing efforts resulted in a gradualrise in orders. Our products now enjoy alarge share of the Taiwanese and Chinese
markets. More recently, new products developed by us have been selected also
by customers in Europe and the U.S., andwe are happy that technology from TDK
Taiwan has been recognized by the world.

n Neodymium magnets
Large, high-performance neodymium magnets from TDK are used
for example in gearless type wind power generators (multi-pole, permanent magnet synchronous generators) and in the rotor structure ofindustrial motors.
[Main applications]
Rotors of multi-pole, permanent magnet synchronous generators, etc.

n Bidirectional DC-DC converters
These power conversion devices can turn the DC current of the source
into a suitable voltage, and also perform conversion in the opposite
direction, sending current to the source. They also enable energy regeneration in industrial equipment powered by electric motors.
[Main applications]
Smart grid, DC power supply systems,
and energy regeneration in industrial
equipment

Actuators for camera modules

n Aluminum electrolytic capacitors
A type of capacitor using oxide coated aluminum
foils as a dielectric, enabling high capacitance
ratings. They are used in various kinds of power
supplies for industrial applications, as well as ininverters and converters for solar and wind power
installations.
[Main applications]
Various types of power supplies, solar and wind
power generation systems, etc.

TDK CSR REPORT 2014

TaiwanSupport autofocus and optical image stabilization functions on smartphone cameras

08

13

TDK CSR REPORT 2014

Monozukuri craftsmanship with a
TDK Taiwan advantage
Creating products in the spirit ofMonozukuri for us involves two fundamental aspects. One is communication
with the customer. To avoid embarking
on vanity projects, one must build a close
relationship with the customer and communicate effectively, to verify that theirneeds are really being met. Furthermore,
the concept of “Time to Market” plays animportant role in the business world of
Taiwan, meaning that products must be
made available at suitable speed. In orderto achieve this, we have consultations withthe customer before the product specifications are put together, and we makesuggestions towards their content. This is
the secret weapon that allows us deliver
the required product within a short timeframe. TDK Taiwan is able to build upon
the high-quality Monozukuri culture fostered in Japan, adding to it design speed
as a particular strength.
The other major aspect is checking
the manufacturing processes with one’s
own eyes. To design a top-notch product, engineers must get out from behind
their desks and spend time on the production floor. With overall optimization inmind, they should inspect every production step from design to the end products
themselves, and always look for possible
improvements.

Social issues such as global warming anddepletion of resources cannot be pushedaside as “someone else’s problem.” We
believe that we must utilize our technological expertise and look for ways in which we
can do our part in solving them, throughour day-to-day development efforts. For
example, by reducing unnecessary current consumption through higher efficiencyof electromagnetic processes, or by increasing the recycling ratio of parts usedin our products, we are trying to reduce
dependency on petroleum products. We
will continue our efforts at improving theenvironment and fulfilling our obligation
to society, in order to be recognized by
the public as a company that combines
value creation with social contributions.
All members of our staff share the group’s
policy, and we endeavor to implement anenvironment-friendly, sustainable management style.
As the actuators mentioned previously
have shown, the Taiwan base is able totake the initiative in creating new products
and successfully supplying them to customers. We hope that this example may inspire other bases of the TDK Group in theirown efforts to pursue similar goals.

Versatile Functionalities
and Environmental
Friendliness that TDK
Supports in the Evolving
U.S. Automotive Market
Ever growing U.S. automotive
marketThe U.S. light-vehicle sales have now advanced for the fourth straight year, and all
major automobile makers are launching
electric vehicles one after the other. In addition, wireless power transfer, Wi-Fi andother consumer product applications are
now being integrated into vehicles, allowing
consumers to quickly charge their phones
as they move in and out of their vehicles,
bringing even further mobility and connectivity to them.

Manager,
Product Development Department,
TDK Taiwan Corporation

Multilayer ceramic chip capacitors
for automotives
Compact high-capacity
capacitors for storing
electric charge

The U.S. automotive market will continue
to require new technologies to meet theneeds driven by consumer demand andgovernment regulations in the time ahead.
In order to realize ever evolving functionalities such as Self Driving Cars and Vehicle
to Vehicle Communication and achieve increased fuel efficiency in vehicles throughthe use of smaller devices, TDK, as a leaderof the electronic components manufacturer,
will be at the forefront of developing products for these applications to respond tochanging market needs.

Manufacturing that responds tosocial changes
As a mother of two young kids, I am always
concerned about the importance of leaving
a beautiful environment to them. In that respect, I am proud to work for a company
that takes so much care to develop business processes and products that are environmentally friendly.

Advantages of EPCOS aluminumelectrolytic capacitors

Hungary

Tech Power of
ONE TDK Sustains
Growth of Renewable
EnergyRise of the renewable energy market

Yi-Liang Chan

TDK is providing electronic componentsthat are indispensable for wireless powertransfer and Wi-Fi devices. TDK’s innovative design and fully automated production
processes are helping to manufacture parts
with both superb performance and smaller
size cost effectively, and thereby supporting the comfortable lives of consumers.
We consider maximizing the “One TDK”
product portfolio and establishing excellent
communication with customers extremely
important in order to provide optimum solutions. We communicate with everyonein the customer’s organization; i.e., engineering, purchasing and production. Eacharea provides valuable information on whatis needed by the customer. We also work
closely and repeatedly with our internal divisions to provide the best solution as quickly
as possible.

Lori Sieczkowski
Global Account Manager,
TDK Corporation of America
Highlight 1

Realizing the Spirit ofMonozukuri Around the World

Highlight 1

These sensors allow contact-free detection of battery charge and discharge currents in HEVs and EVs, inverter drive currents, etc. They areavailable in various product configurations such as Hall element types
and GMR element types.
[Main applications]
Battery charge/discharge current managementfor HEV/EVs, inverter drive current management, etc.

The use of renewable energy sources is expanding worldwide.
The lineup of innovative TDK products in this area is instrumental
in efforts at resolving serious issues such as global warming andthe depletion of resources.

U.S.A.

Sharing Monozukuri power acrossthe entire TDK Groupn Automotive-grade multilayer ceramic chip capacitors

Industrial Equipment & Energy

Value that TDK provides

In the industrial equipment sector in Europe,
the market of products for wind power systems and other renewable energy sources
is growing, propelled by developments
such as rising energy costs and the enactment of laws prescribing the conservation of energy. In particular, offshore windfarm installations are advancing rapidly, in
Europe as well as globally. Compared toland-based installations, facility maintenance for offshore sites is more difficult andcostly, making not only efficiency, but also
rugged construction and reliability important requirements.

EPCOS aluminum electrolytic capacitors
for use in wind power equipment offer anumber of advantages, such as high capacitance, high reliability, and robust construction. They are optimized to deliver highenergy density, making it possible to obtainstable DC voltage with power losses low
while keeping heat generation.
A wide range of products are used insystems for the generation, conversion, andtransmission of electric power, and stringent quality requirements have to be met.
Product lineups in this area therefore must
be constantly improved and augmented.
Our design team consists of professionals who have extensive knowledge in thephysics and electrical engineering aspectsof power electronics as well as advanced
practical experience. We are therefore in
an ideal position to meet the diversified demands of customers in this field.

Aluminum electrolytic
capacitors
Suitable for high power applications
thanks to high capacity ratings andstable quality

rigorous specifications of power grids. We
are therefore engaged in ongoing development efforts aimed at new capacitors witheven higher power handling capability andenhanced thermal dissipation efficiency.
As an organization that combines a wide
range of product portfolios under a single
umbrella, ONE TDK can bring a uniquesynergy into play, offering optimal solution packages that exactly meet customer
requirements, while also creating added
value for society at large.

Synergy of ONE TDK creates truevalue
In the future, the demand for power generation equipment incorporating leadingedge technology for use in offshore windfarms is bound to keep rising. Power converters for such equipment must provide
even higher performance to clear the more

Gábor Székely
Product Development Engineer,
Aluminum and Film Capacitors B.Grp,
EPCOS Elektronikai Alkatrész Kft.

TDK CSR REPORT 201414

CSR Activities Supporting Value Creation

Highlight 2

Responsibility in the Supply Chain
2004

Social Trends and TDK’s Response
Here we introduce TDK’s activities and response so far to fulfill social responsibility in the supply chain, implemented
in accordance with changes in social trends, as well as TDK’s thoughts about what should be done from now on in the
supply chain as a whole to achieve the original aims of these activities.

Establishment of the Electric Industry
Code of Conduct (EICC)
ISO resolution on the standardizationof social responsibility

Establishment of the Responsible Minerals
Trade Working Group by JEITA

2010

2013

2006

minerals through the enactment of the U.S.

substances by enforcement of the Restriction

Social trends

Child labor in the apparel industry, etc.,

spotlight human rights problems
at contract manufacturers

1996

2000

Issue of ISO 14001

Launch of the United
Nations Global Compact

1999

Issue of the Global
Reporting Initiative (GRI)
Sustainability Reporting
Guidelines

Issue of OHSAS 18001

TDK’s
response andachievementsof Hazardous Substances (RoHS) directive
Compilation of the Supply Chain CSR
Promotion Guidebook by the Japan

Electronics and Information Technology
Industries Association (JEITA)

2007
Obligation to register chemical substancesin the European Union (EU) by issue of theInternational standards for the social responsibility

2011

Global Compact

Adoption by the United Nations of the
Guiding Principles on Business and Human
RightsInterest in supply chain management gains
momentum; sharp increase in CSR audits
by customers

20 00

Announcement of International Integrated
Reporting Framework by the International
Integrated Reporting Council (IIRC)
Announcement of Building the Post-2015
Business Engagement Architecture by the UNof organizations by the issue of ISO 26000

Registration, Evaluation, Authorization
and Restriction of Chemicals (REACH)
regulation

As an aspect of supply chain management(SCM), interest grows in human rights
problems in global corporations

2010

1997

2000

2004

2009

Starts consolidated control ofchemical substances

Implementation of productassessment

Decides implementationof OHSMS

for all general-purpose electronic components

based on the EICC and JEITA

Participates in JEITA’s Responsible
Minerals Trade Working Group

1995

Obtains ISO 14001 certification
by Mikumagawa Plant, first in
TDK Group

2002

Acquires OHSAS 18001 certification

Establishes the CSR Promotion Office

Revises the TDK Code of Conduct

2010

Improves CSR level by several measures

1999
The Mikumagawa Plant acquires
occupational health and safety
management system (OHSMS)
certification based on BS8800
Starts green procurement

Inaugurates the ProductEnvironment Committee
Establishes the Business
Ethics Committee (now theBusiness Ethics & CSR Committee)

Issues the TDK Code of
Conduct

Completes response to RoHS directive
for the companywide system

2005

Establishes the CSR Task Force

2007
Participates in Japan Article
Management Promotion (JAMP)
consortium as a promoter(Japanese sites)

History of TDK’s Supply Chain Response
Since the spotlight fell on the problem of human rights in contract manufacturers in the
1990s, a consensus was formed that CSR
cannot be accomplished by the singlehanded efforts of companies but must be
promoted throughout the supply chain as awhole. The TDK Group conducts businesssupported by relations with many customers
and business partners, so it exists in a business environment that is heavily influenced
by legislative systems, international industrial standards, and other factors involving the

TDK CSR REPORT 2014

Financial Regulatory Reform Act (DoddFrank Act)

Issue of version 4 of the GRI guidelines

1993

Starts implementation of ISO 14001

15

Obligation to disclose information on use of conflict

Highlight 2

Social Trends and TDK’s
Response

1990

2012

Issue of the Guidelines for Life Cycle
Assessment: Electronic Components by JEITARegulation on the use of designated hazardous

1990 –

2008

entire supply chain.
After the turn of the century, there was a
sharp increase in the number of legislationbased demands from customers, including
requests for the disclosure of information
relating to chemical substances containedin products. Despite the fact that survey
content was the same, the variety of survey
formats in companies became a cause of inconsistent understanding, as well as requiring excessive labor power and a heavy costburden in responding.

Starts CSR self check

Discloses chemical substance informationon the “JAMP-GP chemical substances in
products information system”
Starts response to conflict minerals

2011
Formulates fundamental environmental
plan, TDK Environmental Action 20202012

(Internal CSR auditor training, etc.)

à See feature on pages 17–18

2013
Compiles policy on conflict minerals; starts
full-fledged response
Starts efforts for human rights due diligenceà See feature on pages 17–18

TDK’s Problem Awareness and Proposal of Solutions
In order to implement CSR in the supply
chain both rationally and effectively, it isessential to have a common awareness ofsocial issues and common survey formats.
So as to contribute to the improvement of efficiency in the supply chain as a whole, TDK
participates in the activities of various organizations from the rule-making stage, cooperates with the entire industry, and makes
proposals for the standardization of survey
formats.

Society requires companies to upgrade theiractivities through the formation of problemsolving platforms, so moves to strengthen
CSR activities in the supply chain as a whole
are going to become even livelier in the future. At present, however, since companies
are implementing self-diagnosis and audits
with limited resources, there is a limit to bothbuyer and supplier response, and it is fearedthat in the future management costs will escalate and response fatigue will set in. In order to mitigate these factors, TDK believes

that the following measures are necessary:• The cross-industrial standardizationof self-diagnosis relating to commonsocial issues and the formulation of audit
standards• The building of a mechanism to shareself-diagnosis and audit information
across industries and the summarizingof this information to share regional risk
information• Response to the solution of human rights
problems, such as working hours

None of these measures can be implemented by individual companies alone. Throughdialogue and cooperation with various sectors, TDK will promote efforts toward thesolution of labor problems and other issues
closely linked to the community and contribute to the building of sustainable societies.

TDK CSR REPORT 201416

CSR Activities Supporting
Value Creation

Responses to the Expectations of Society
Lead to Improved Corporate Value—CSR Internal Auditor Training—
TDK strives to enhance employee understanding in order to fulfill its social responsibility in the supply chain.

participants about the background to the EICC code and its
requirements.
Furthermore, the program includes responses to casestudies and other activities implemented so that eventually
the participants themselves will be able to conduct audits
at other sites and suppliers. In addition, at high-risk manufacturing sites, if they do not have an opportunity to receive
CSR audits from customers, internal auditing by a third-party organization is required once every two years in an effort
to raise the level of CSR activities.

Comment by a Training Participant
Through my participation in this training, I realizedthat the promotion of CSR leads to the provision ofpleasant and safe workplaces for employees. Thisis then directly reflected in low employee turnoverrates and higher motivation among employees,
which ultimately I think enhances the value andcompetitiveness of the company as a whole.
As a result of the entrenchment and development of CSR management, while still being based

EICC Code of Conduct• Freely chosen employment• Child labor avoidance• Working hours• Wages and benefits• Humane treatment• Non-discrimination• Freedom of association• Environmental permits and reporting• Pollution prevention and resource
reduction• Hazardous substances• Wastewater and solid waste• Air emissions• Product content restrictions

on the EICC Code of Conduct, the standards demanded by customers can be expected to become even stricter in the future. Also, as was thecase with the environmental management system,
rather than management for the sake of audits, itwill be necessary for companies themselves tocontinuously improve management levels.

Labor

Environmental

Taking advantage of this training experience,at TDK Dalian Corporation, where I work, we areManagement
systemHealthand safety

CSR internal audit

Enhancing every employee’s sensitivity
toward social requirements
In recognition of the need to respond to requests for CSR
audits from electronic equipment makers, who are our customers, and to the social trends which are part of the background of these requests, such as the increasing awarenessof consumers and the enactment of legislation, TDK is taking the initiative in promoting activities. Specifically, as well
as strictly observing laws and requirements in the countries
in which we operate, while understanding the different requirements and levels of customers, TDK responds to awide range of CSR-related efforts in such fields as labor,
ethics, health and safety, environmental, and management
system.
In order to respond smoothly to the diverse requests ofcustomers relating to CSR audits, first of all it is necessary
to further deepen our own knowledge and understanding of
CSR audits. Accordingly, in 2013 TDK began CSR internal
auditor training for employees engaged in work relating to
CSR. The objectives of this training are to enable employees to systematically understand customer demands andmaster the basics for evaluating the CSR activities of theirown company, thereby also upgrading the level of these activities. In the first fiscal year, the training was held in Tokyoin 2013, and once each in Tsuruoka (Yamagata Prefecture,
Japan) and Shanghai (China) in 2014.

17

TDK CSR REPORT 2014

Understanding the code of conduct
required of an electronic components
manufacturer
This CSR internal auditor training is mainly for general managers, plant managers, and managers engaged in CSRrelated work at the manufacturing sites. In fiscal 2014, 21
plant managers and other employees from the Tsuruoka,
Sakata, and Iida plants took part in the training in Tsuruoka,
and 30 people from the Xiamen, Qingdao, Dalian, Suzhou,
Wuxi, Hong Kong, and other sites in China attended thetraining in Shanghai.
After covering basic thinking on CSR, such as ISO
26000, the training program seeks to deepen participants’ understanding of the Electronic Industry Citizenship
Coalition (EICC) Code of Conduct, which is the basic codeof conduct for electronic components makers like TDK. In
the electronic equipment industry’s supply chain, it is essential to ensure a safe working environment, to respect thehuman rights and dignity of workers and maintain friendly
working environments, and to accept responsibility for theenvironmental load in the manufacturing process. The standards that should be kept in order to realize these threepoints are divided into five sections in the EICC Code of
Conduct: labor, health and safety, environmental, ethics,
and management system. While also referring to legislation in the country concerned, the training program teaches

tems, for example relating to welfare, set fiscal year
objectives for CSR, and conduct internal auditing
and reviews. Through these efforts, we hope to re-

Ethicsalize an even more vibrant working environment for
employees.

• Business integrity• No improper advantage• Disclosure of information• Intellectual property• Fair business, advertising and competition• Protection of identity• Responsible sourcing of minerals• Privacy• Non-retaliation

Highlight 2

Responses to the Expectationsof Society Lead to Improved
Corporate Value• Occupational safety• Emergency preparedness• Occupational injury and illness• Industrial hygiene• Physically demanding work
• Machine safeguarding• Sanitation, food, and housing

planning to improve internal regulations and sys-

Renliang
GuoManager,
Personnel andGeneral Affairs
Department,
TDK DalianCorporation

Raising the CSR awareness of employees
Employees who have participated in the training havemade such comments as, “I was able to understand thatthe observance of laws and regulations is no more than aprecondition for CSR and that, on top of the observance oflegislation, it is necessary to address environmental andother problems;” and, “I realized that CSR leads to improvement of the company’s brand image and in turn its competitiveness as well.”
The training does not simply enable participants to master internal audit skills. By deepening understanding of thebasic notion of CSR, it also raises employee awareness of
the importance of CSR.
In recent years social interest in environmental, labor,
and human rights problems has been increasing, and companies are being called on more and more to actively address these issues. It is the natural duty of a responsible
company to make efforts to identify and reduce risks bythoroughly enforcing an internal audit system and to respond smoothly to audit requests from customers.
Through the training of internal auditors and various
other activities, TDK will continue to fulfill this obligation andmake further efforts to raise the awareness of employees.
Internal CSR auditor training

TDK CSR REPORT 201418

CSR Activities Supporting
Value Creation

Identification of Human Rights Issues
through Dialogue with Stakeholders
At TDK, we have repeatedly held discussions with various stakeholders in order to understand and identify human rights
issues in our business activities and relations. The following is the overview of a project in which we have been engaging
since FY 2014 and the process by which we identify human rights issues in the Group.

Participation in the Nippon CSR

In order to further deepen our understandings of humanrights issues relevant to TDK, since FY 2014, we have been
participating in the Nippon CSR Consortium’s Stakeholder
Engagement Program*, organized by the Caux Round Table
Japan, and holding repeated discussions with other companies, NGOs and NPOs, academics, and experts.
Furthermore, we have also been working on prioritizationof human rights issues to be addressed in our value chain,by mapping existing initiatives based on “human rights issues considered important in the manufacturing sector” inthe “Human rights Issues by Sector” drawn up through theprocess shown as diagram below.

Consortium’s Stakeholder Engagement
Program* For details about the Stakeholder Engagement Program and sustainable navigation
steps, please see the Caux Round Table Japan website:
http://www.crt-japan.jp/EN/files/Holistic_Approach/framework.html

Full Process (Sustainable Navigation) toward
the Identification of Human Rights Issues,Countermeasures and the State of TDK’s Activities
Nippon CSR Consortium (HRDDWS)

A

STEP

B

Dialogue between Identification ofcompanies andhuman rights
stakeholders
issues by sector
STEP

STEP

Mappig relevant
sustainability
issues andbusiness strategy

Inherent risk
assessment

Risk management
in major supplier

STEP

STEP

STEP

G

Dialogue withstakeholders,
NGOs & experts

STEP

H

Developing policy
and action plan

STEP

I

Activities,
training,
audit

Do

Mapping ofexisting activities

E

Review

Action

F

D

Step

A

• NGO/NPOs pointed out potential
and actual human rights impacts ofbusiness activities.

B• Identified value chain and associated region for specific products
and services.
• Mapped actual and potential humanrights issues in the value chain bysector.

Prioritize

Materiality

STEP

C

Steps Taken by TDK in FY 2014

Identify

HRDDWSSTEP

HRDDWS: Human Rights Due
Diligence Workshop

L

Step

Reviewing
the report

STEP
Check

Review

J

Review activities
by the Executive
Committee• Mapped existing
activities at theindividual company
level based on human rights issues
identified throughthe Step A and B.

Step

F

Step

G • Dialogue with Experts

STEP
ReportReportK

Endorsement©2014 Caux Round Table Japan19

TDK CSR REPORT 2014

On March 4, 2014, TDK held a dialogue with Mr. Makoto
Teranaka and Mr. Hiroshi Ishida, who are members of the
Nippon CSR Consortium, to identify human rights issues relevant to TDK.
In the dialogue, Mr. Teranaka and Mr. Ishida gave highlysuggestive talks, the former about the importance of addressing human rights issues and the latter about global
CSR trend and human rights due diligence. Following thepresentation on the TDK’s current efforts in these areas, alively discussion was held to identify relevant issues to TDK,
noting the importance of gaining trust and participation in
rule-making.
The importance of management’s involvement was alsoemphasized in the discussion. Participants commented thatmanagement can clarify the company’s policy and standpoint, explain the reasons why the specific issues werechosen, and, by prioritizing issues, make it easier to channel resources. On the other hand, a challenge in balancing

Dialogue participants: Junji Yoneyama (Director, Senior Vice President, General Manager,
Administration HQ), Masato Ishikawa (General Manager, Corporate Planning Group),
Akihiko Ayabe (Senior Manager, Personnel and Labor Administration Department, Human
Resources Group, Administration HQ), Ikuo Fukuchi (Senior Manager, Legal Department,
Legal Group, Administration HQ), Sachiko Nagahara (General Manager, CSR Promotion
Office, Administration HQ), Hiroshi Kobayashi (Assistant Manager, CSR Promotion Office,Administration HQ) (titles and positions at time of dialogue).

between TDK’s priorities and customers’ requirements was
also pointed out.

Main Opinions and Proposals from Experts
Makoto Teranaka
Visiting lecturer, Faculty of Contemporary Law,
Tokyo Keizai University

The Global Society is now paying large attention
to corporates for their responsibilities on businesses including efforts combating against white-collar crimes and corruption. This inevitably requires to strengthen governance within
Japanese companies. The CSR nowadays is not only the matter to be carried out by individual units within a company, but
a comprehensive strategy to be dealt by the top management.
Human rights issues are expected to be assessed by eachcompany according to a checklist which items are based upon
the UN Guiding Principles. The most important aspect of thisprocedure is, however, not to get the full score, but to ensurethat you have a firm and capable governance structure with afull ability for such assessment. It is essential to share the same
purpose, that is to protect human rights, and make sure thatyour company is on the way to make it real with a vision of clear
direction yourself. Creating checklists should be regarded as
an useful method, but to be sure, it is not the objectives itself.

After Dialogue
Junji Yoneyama
Director, Senior Vice President, General Manager, Administration HQEver since its founding, TDK has supplied value to society by putting its corporate motto into practice. Business and human rights areclosely related, and we are proud to have firmly addressed this issue.
As a result of the rapid globalization of business, though, it has become apparent that Japanese values sometimes no longer hold water.
In today’s dialogue, we heard some valuable opinions, such as theimportance of understanding, prioritizing, and tackling CSR in accordance with business strategy, the importance of understanding
goals in tackling human rights issues and selecting the right means
to achieve those goals, and the importance of management’s awareness. TDK sincerely accepts these opinions and will closely examine
them in order to continue its mission of contributing to culture andindustry through creativity.

Hiroshi Ishida
Executive Director, Caux Round Table Japan

The impact that companies exert on society, both
positive and negative, is immeasurable. For this very reason,
corporate commitment is essential to create a better-society.
In this sense, corporate active participation in rule-making process, while jointly working with other companies, is crucial bothfor society and for companies themselves.
A company could possibly be associated with a number ofhuman rights issues. What is needed is to prioritize the issues
and to allocate limited resources effectively. As addressing
human rights issues will be an integral part of corporate management, it will be increasingly important for managements toindicate the direction and their decision regarding which issues
to be dealt with, to what extent, and in what way.

Highlight 2

Identification of Human Rights
Issues through Dialogue with
Stakeholders

Since the UN Human Rights Council adopted “protect,respect, and remedy” framework, known as the Ruggie
Framework, with regards to business and human rights in
2008, a series of international CSR guidelines and UN and
EU policies have been introduced in accordance with theframework. This trend represents a strong appeal to companies to specifically identify human rights issues in their business activities and take appropriate actions.
We have been working on addressing the issues of conflict minerals, working environment at sites, and other humanrights issues within the company and our supply chain, realizing their increasing importance to corporate management.

Dialogue with Experts

Endorsement
Statement of Human Rights Due Diligence Status Check
Caux Round Table Japan herewith confirms that TDK Corporation
has understood a holistic approach shown as the framework of
Sustainable Navigation, and undertook the following activities.
TDK Corporation participated in a series of Human Rights Due
Diligence Workshops at the Nippon CSR Consortium. During theworkshops, TDK Corporation contributed to identifying humanrights issues related to the value chain of the manufacturingsector, while sharing expertise with other members from different
companies, NGOs and experts (Steps A and B). In addition, at theindividual company level, TDK Corporation has mapped existing
CSR activities, and had a dialogue with experts (Steps F and G).
I look forward to seeing how TDK Corporation will determine
policy and put this into concrete actions (Steps H and I).

Hiroshi Ishida
Executive Director, Caux Round Table JapanTDK CSR REPORT 201420

Activity Report

TDK Group’s CSR

Through practice of the corporate motto of “Contibute to culture and industry through creativity,” the TDK Group aims to realize asustainable society and company. Furthermore, in consideration of the degree of impact on and importance to society and TDK,
we have selected four material activity areas from the perspective of CSR in which we are implementing the plan-do-check-act(PDCA) cycle. The following is a report of fiscal 2014 achievements and fiscal 2015 plans in these four areas.

TDK Group’s CSR

State of Progress in Important Activity Areas from a CSR Perspective
Item
Creation of asustainable society

Continued evolvementof business

Implement Corporate Motto
Contribute to culture and industry throughcreativity

Enhance
corporate
value

Social aspect

Customers

Economic
aspectEnvironmental
aspectThe TDK Group’s approach to CSR is based on the practice of the
TDK corporate motto and the thorough implementation of corporate
ethics. Recognizing that TDK is a social entity supported by stakeholders, such as customers, suppliers, employees, shareholders,investors, and local communities, while maintaining communication
with these stakeholders, we are promoting CSR activities throughour business activities on the basis of the TDK Code of Conduct*.
In response to the revision and issue of version 4 of the Global
Reporting Initiative’s Sustainability Reporting Guidelines, we madethe following responses in fiscal 2014:• Analysis of the present level of information disclosure• Participation in the GRI G4 Certified Training Course• Arrangement of information sources by stakeholder toward identification of material aspects
From now on also, TDK will pursue the forms of CSR and information
disclosure demanded by society

Organization

President & CEO

2

Innovative
craftsmanshiptraining• Continue the TDK Monozukuri Tradition
Seminars• Implemented TDK Monozukuri Tradition Seminar(9 participants)• Continue to implement TDK Monozukuri Tradition Seminars

Development of
global humanresources• Continue cross-cultural communication training
and IMD seminars• Launched the Global HR Department in
September 2013

• Continue to bolster the overseas trainee
program• Continued to implement cross-cultural communication training (59 participants) and IMD
seminars (19 participants)

Contribution to theworld by technology

HQ
Functions
CSR Promotion
OfficeManufacturing
HQ

CSR awarenesswithin the company

Shareholders/
Investors• Continue to conduct the seminars at overseas
sites according to team composition• Improve global human resource function• Continue to implement cross-cultural communication training and IMD seminars• Continue to bolster the overseas trainee
program• Continue to implement e-learning (Japan, China), and expand the overseas implementation
areas (increased the number of sites in China,
and extended to Europe and the Americas.)• Continued to implement e-learning and expanded overseas implementation areas (increased
number of sites in China and newly extended to
ASEAN region, Europe, and the Americas)• Continue to implement e-learning and expand
coverage (continue to implement once a year atsites where already implemented and approach
new group companies)• Continue to broaden coverage of the stratified
group training• Implemented corporate ethics and CSR education in new graduates and assistant manager’s
training• Continue to implement corporate ethics andCSR education in new graduates and assistantmanager’s training• Implemented CSR awareness raising in IMD
seminars• Continue to implement CSR awareness raisingin IMD seminars• Continued to strengthen items in CSR checksheets for suppliers and guidance (93%
retrieval rate)• Continue to regularly revise CSR check sheets
for suppliers, provide education and guidance• Promote CSR awareness during IMD training

issues related to the TDK Code of Conduct involving employees of
TDK Group companies around the world.

CSR Promotion Office3

Promote CSR
procurement• Periodically revise CSR check sheets for suppliers and continue to provide guidance• Expand supplier CSR audits

Society andenvironmental
considerations in the
supply chain
Handle conflictminerals regulations

The CSR Promotion Office has in-depth knowledge of social issues
and requirements and promotes CSR activities in a professional manner. The office strategically examines the various demands received
from customers and society from such perspectives as their urgency
and importance, their impact on TDK, the capabilities of TDK, anddegree of contribution to society. Working closely with other departments in the company, it formulates policies and implements responsive actions. The CSR Promotion Office also promotes the spread of
CSR awareness in TDK and organizes training programs.

• Implement CSR training at employment agencies focusing on labor and human rights• Implemented supplier CSR audits (27 suppliers)• Implement supplier CSR audits and improve
quality• Implemented CSR surveys at employment agencies focusing on labor and human rights• Implement CSR training at employment agencies focusing on labor and human rights• Continue gathering information and assessing
trends regarding interpretation of SEC’s final
conflict mineral rules• Gathered information and assessed trends
through participation in Responsible Minerals
Trade Working Group• Gather information and assess trends regarding
interpretation of the SEC’s final conflict mineralrules• Continue to provide a proper response forcustomers and suppliers• In anticipation of an increase in survey requests
from customers, began operation in July 2013 ofa new organization (2,158 replies)• Continue to respond to customers• Continue to improve the internal company
framework• Implemented explanations of conflict mineralsurvey to suppliers (implemented in May 2013
and June – July 2013 through sponsorshipof JEITA/JAPIA (Japan Auto Parts Industries
Association)• Implement regular surveys for newly purchased
products and improve identification of refineries
for existing purchased products• Establish in-house arrangements in response
to interpretation of the SEC’s final conflictmineral rules• Began implementation from June 2013 of surveys using the EICC/GeSI (Global e-Sustainability Initiative) conflict minerals reporting template(100% retrieval rate)• In April 2013 held a briefing session internally

CSR basedcustomer relations• Implement regular TDK CSR “Self Checks” atmanufacturing sites and promote managementlevel improvement• Implement self-imposed audits by third party
organizations (8 sites in China and other Asian
locations)• Respond to CSR survey and auditing requests
from customers in a timely manner

Board of Directors

Europe4

Asia
Help Line• Implemented regular TDK CSR self-checks atmanufacturing sites and promoted management-level improvements centering on labor andhuman rights• Implement regular TDK CSR self-checks atmanufacturing sites and promote risk-management-level improvements relating to labor andcorporate ethics• Implemented audits by third-party organizations(of the eight sites, five sites underwent customer
audits and the other three sites conductedvoluntarily)• Continue to implement third-party audits once
every two years (including requests from
customers)• Responded to CSR survey and auditing requests from customers in a timely mannerBusiness Ethics & CSR Committee
AmericasTechnology
HQ• Conduct the seminars at overseas sites according to team composition• Bolstered overseas trainee program(4 participants)

Local communities

Suppliers

Help LineTDK CSR REPORT 2014

• Continue to promote the development of
products that contribute to the solution of social
issues in the priority strategic fields of ICT, automobiles, and industrial equipment and energy

TDK’s Code of Conduct

Business
Ethics& CSR
Committee

Executive Committee

21• Continued development of rare-earth-freemagnets; developed lead-free piezoelectricmaterial; continued development of wirelesspower transfer; etc.

CSR Promotion Structure
Board of Director

Business
Groups• Continue to promote the development of products which contribute toward solving problems
in the Mid Term Plan, with special-emphasis on“Next-generation Information and Communications” and “Energy-related”

Activity Report

TDK Group’s CSR

The Business Ethics & CSR Committee reports directly to theBoard of Directors and comprises the general manager of the
Administration HQ, function managers from the Corporate PlanningGroup, Corporate Communications Group, Human ResourcesGroup, General Affairs Group, Legal Group, CSR Promotion Office,Finance and Accounting Department, and Management Review
and Support Department, and the chief compliance officer (CCO) of
TDK-EPC. The mission of the committee is to identify and solve any

Contribute toresolving social
problems throughbusiness activities

Employees

CSR Promotion Structure

Business Ethics & CSR Committee

FY 2015 Action Plan

TDK’s Business Activities* For the complete text of the TDK Code of Conduct, please refer to the following URL:
http://www.global.tdk.com/about_tdk/code_of_conduct/

Based on the activities of the Business Ethics & CSR Committee,
which reports directly to the Board of Directors, the entire TDK Group
engages in unison in a wide range of CSR themes through coordination among the CSR Promotion Office and other departments in theheadquarters, business groups, and TDK sites around the world.

FY 2014 Results

1

Development of
human resources

CSR Activities

FY 2014 Action Plan

Help Line

Subsidiary

Subsidiary

Subsidiary

Ethics Council

Ethics Council

Ethics Council

Consultation

Consultation

Consultation

Symbiosis with theglobal environment

Promoteenvironmental
activities• Respond to CSR survey and auditing requests
from customers in a timely manner• Promote environment-oriented activities basedon the TDK Environmental Action 2020

• Promoted environment-oriented activities basedon the TDK Environmental Action 2020

• Promote environment-oriented activities basedon the TDK Environmental Action 2020

• Continue to work towards achieving carbon
neutrality:• Toward achievement of carbon neutrality:• Toward achievement of carbon neutrality:• Reduce CO2 emissions (environmental load)from manufacturing operations to no morethan 1,090,000 t- CO2• Increase the reduction of CO2 emissions
through products (environmental contributions): implement TDK calculation standards
for environmental contributions, and obtain
contribution allocation• CO2 emissions in manufacturing operations(environmental load): 1.063 million tons
• Offset CO2 reductions in products (environmental contribution): 886,000 tons; expanded
range of products for which environmental
contributions can be determined• Reduce CO2 emissions in manufacturing
operations (environmental load): 1.07 million
tons or less
• Increase offset CO2 reductions in products(environmental contribution): 700,000 tons
or moreTDK CSR REPORT 2014

22

CASE

1

Contribution to the Worldby Technology
In what ways and means can TDK create value for society? We feel that the answer to this question lies
most precisely in the motto of “Contribution to the world by technology” In this feature, we introduce
the zeal of the top manager of our Technology HQ, along with the determination of engineers working
on the frontlines of that division, as they mobilize the spirit of craftsmanship and the unique technological prowess of TDK since the company’s inception in the quest to emerge as the “World’s Most
Powerful Technology Development Group.”

Striving to Become a Company that Works
through “Challenge” and “Revolution” inTechnological Development, Constantly
Supporting the Social Infrastructure
Kaoru Matsuoka
Senior Vice President,
General Manager, Technology HQGeneral Manager,
Advanced Technology Development Center

Contributing to Society with
Materials Technology — Looking
Back on FY 2014
TDK is a company that has achieved steady
growth over the years on the strength of ferrite, the material that provided the impetus
for the company’s foundation, and other materials technology. This was motivated by thedesire to contribute to society through thedevelopment of materials that had yet to exist in the world. There has been no change
in that passion over the years since, right up
to the present day. In that sense, 2013 wasa year of major progress for the TDK family.
First, in magnetic materials, we are mobilizing the development of new materials
and process technologies to carry on thedevelopment of magnets that do not use rareearth metals, and remain determined to realize the stable supply and low pricing of suchproducts.
In the piezoelectric field as well, we succeeded in the development of piezoelectric materials that do not contain lead — ametal exerting adverse impact on the humanbody and the environment. Looking ahead,
we are determined to excel as the leader inthe move to expand this lead-free movement
throughout the industry as a whole.
In “wireless power transfer,” an area currently in the spotlight as a new technology,
we are pushing on with R&D aimed at making key contributions through the development and manufacture of ferrite, coils andother products. We fully recognize such

23

TDK CSR REPORT 2014

wireless power transfer, which also inspires
high expectations for application in electric vehicles, power supplies to railways
and other areas, as an important technology for supporting the ever-evolving social
infrastructure.
In this way, it is our mission to create fromscratch breakthroughs that are viewed asnecessary by the world in which we live. To
put that conviction into action, we will continue to rise to each “challenge” and bringabout “revolution” in the arena of technological development from here on as well.

Applying the Corporate Motto to
All Benchmarks
Human resource development is the core of
the company. In our view, however, it is notjust high technological skills that are vital,
with the goal being to cultivate personnel
capable of profoundly grasping and implementing the TDK mindset.
It is difficult to specifically train employees
to be contributing human resources, withcapable personnel prone to naturally matureand blossom on the job. For companies, itis critical to “create environments in whichpeople can develop.” During fiscal 2014,
we prepared a human resource databasethat renders it possible to grasp our technical employees’ careers at a glance, while
we also bolstered our job rotation scheme
to empower employees to vigorously experience other fields from early on in theircareers. It is our firm conviction that rotating
our personnel around and adopting a thorough approach to putting the right people in
the right posts will support the realization ofdiversity in the true sense of the word.
Last year, we announced the goal of
making TDK the “World’s Most Powerful
Technology Development Group.” To realize that aim, we believe that the most important requirements are for each and every
employee to clearly envision the presenceof our customers as the “end recipients” oftheir own work; together with progress in further expanding the ranks of so-called “selfdirected personnel” capable of uncovering
themes on their own and taking action withfull independence. Regarding engineers, forwhom the greatest joy lies in creating breakthroughs that have not existed in the world
before, I am confident that this is truly theright and proper stance.
I want our employees to muster the courage never to give up, even if they encounter
failures along the way, and rise to the challenges of reaching their own special aspirations. At such times, the benchmarks forall of our judgments should be the TDK corporate motto of “Contribute to Culture andIndustry through Creativity,” in tandem withour corporate principles of “Vision, Courage
and Trust.” As a member of the TDK management team, I am determined to do everything in my power to achieve wider anddeeper acceptance of and compliance withthis stance.

Steadily Rising to Meet
the Challenges of Highly
Specialized Themes

The Challenge ofDeveloping Materials
that the World has
Never Seen Before

I am engaged in both coordinating andpromoting the development themes fornext-generation battery materials being advanced at TDK business bases in Japan andoverseas. The main thrust of this work consists of confirming the state of progress being made on each separate theme, moving
to engineer collaboration between different
themes, getting new themes off the ground,setting goals compatible with businessneeds and taking other steps. What I strive
to achieve as a leader is to convey clear
indications of each project’s aims and theindividual targets along the way. My efforts
are channeled into advancing close communications and raising the motivation of eachand every member of the team.
Among the materials that we work with,there are various different structural components. When we realized the high goals set
for each of those components, with products
completed by pooling those components
together to reach the final target values, allmembers of the project team shared in a tremendous sense of accomplishment.
At TDK, we have built up the technology,
which could be very well be equated to ourown “corporate DNA,” of handling ferrite andother types of fine powders. Batteries, which
harness the properties of such powders,
comprise a field that takes maximum advantage of the in-house technology at TDK.
Going forward, my goal is to remain
firmly grounded in the essentials of thetechnologies developed to date, while devising means of utilizing such know-how inother fields. More specifically, in energy,
health care and other sectors, for example.
Batteries are also an indispensable elementin the technology for smart grids and otherdomains, and I will be moving to make extensive contributions to the world through thedevelopment of highly efficient, low-cost battery materials.

I am assigned to development of “angle sensors” — devices used to detect the current
position of rotating motors. In automobiles,
for example, they are applied in controlling
everything from wheels to windshield wipers, to improve driving performance, prevent malfunctions and for other purposes.
To cope with the growing enhancement ofsafety in recent years, meanwhile, there issoaring demand for products built with unprecedented high precision and robustness(the capacity to prevent changes in certain
characteristics due to the impact of shifts inthe environment or other external factors).
My team is in charge of IC development
aimed at heightening sensor precision andenriching function. One area that proveschallenging in this development work relates to the demands for robustness capableof ensuring accuracy on various different
fronts, even under fierce environments oftemperature and electromagnetic waves, all
the way through to breakdowns. With TDK
able to address these areas on a fully integrated basis, from the sensor design throughthe IC design, we have high hopes that earlyproblem-solving abilities will provide a keyedge.
I was previously stationed in Germany for
two years through a technology exchange
program. The high level of specialization
among the young technicians I met during that time was quite inspiring, while atthe same time making me keenly aware of
my own weaknesses. While still far short on
the experience needed to contribute to the
TDK goal of becoming the “World’s Most
Powerful Technology Development Group,”
I am determined to rise to the challenge ofaddressing more highly specialized themes.
My aim is to reach beyond myself and bringthose around me onboard this push, working
together to further hone our skill levels as atightly knit team.

I am involved in the work of developing
materials for magnets that reduce theamounts of rare earth metals — a resource for which supplying nations arelimited and fluctuations in price are fierce.
I feel a great sense of challenge and reward in this work, because succeeding
will make it possible to supply magnets
at stable prices, helping to win trust in theeyes of our customers and realizing combinations of materials that no one has everundertaken before. If we can also define
applications on other fronts for the compositional development that we are currently
advancing, I believe it will also be possible
to contribute to raising the efficiency ofoverall TDK materials development.
Nearly six years have passed since I
joined TDK. It is my sense that all of myexperiences to date, including both thesuccesses and the failures, have combined to help create who I am today. It is
my conviction that remaining diligent ineverything you do will provide benefits inthe end, encouraging me never to cut corners in any work and do every task to thevery best of my ability.
Working for a manufacturer also generates the motivation of contributing to therelease on the marketplace of productsthat I have personally helped to develop.
With the job rotation system, there are also
opportunities to experience working not
only in the development field but manufacturing as well, which is certainly a welcome touch. In addition to that, in orderto manifest our strengths as the “World’s
Most Powerful Technology Development
Group,” it would also be wonderful to havetraining opportunities to cultivate “humanties” through interaction with other employees that I do not normally come into
contact with.

Atsushi Sano

Keita Miyachi

Tomoko Kitamura

Leader,Battery Materials Development Team,
Advanced Technology Development Center,
Technology HQEngineer,
Mechanism Development Team,
Advanced Technology Development Center,
Technology HQResearcher,
Magnetic Materials Development Team,
Advanced Technology Development Center,
Technology HQ

TDK CSR REPORT 2014

Contribution to the World byTechnology

Contribution to the World byTechnology

Kaoru Matsuoka, head of the TDK Technology HQ, reflects backon fiscal 2014 with regard to “Contributing to the World throughTechnology” — a theme that can be said to be tantamount to thecore business of TDK as a corporate entity — while also sharing
his passionate view of what lies ahead.

The Desire to Contributein Numerous Fields,
while Remaining Closely
Grounded in the Essentials
of Technology

24

CASE

2

Development of Human Resources

TDK Monozukuri Tradition Seminars

In order to realize TDK’s corporate motto of “Contribute to culture and industry through creativity,” ideally every individual member of the organization should engage in work autonomously. The following is
an introduction to the human resource development conducted by the TDK Group as a whole.

TDK has been holding TDK Monozukuri Tradition Seminars, a training program for nextgeneration management personnel and plant managers, since 2010. This training cultivates
manufacturing leaders capable of seeing the whole monozukuri (manufacturing craftsmanship) process and thinking in terms of total optimization. The aim of the program is to pass
TDK’s spirit of monozukuri on to the next generation, and the basic principle is the spirit of“self-training and self-development,” which encourages participants to think, practice, andstudy by themselves.
The centerpiece of the seminars consists of monozukuri lectures by veteran employees,
who convey the spirit and origins of monozukuri through their own abundant experiences. In
addition, participants visit plants for training, take part in small group discussions, engage inZen meditation to deepen their thinking, and also have opportunities for direct talks with top
management.
Another characteristic of the seminars is that leaders in various fields broadly related tomonozukuri, such as development, design, sales, quality assurance, and production technology, participate as team units. The aim here is that after the training has finished, all sectors
will cooperate to improve the monozukuri process as a whole.
So far an aggregate total of 90 employees have participated in the seminars, including a
lot of employees from overseas sites in China and the ASEAN region. Amid the expansion ofbusiness globally, TDK will inherit and evolve the spirit of monozukuri, which is our starting
point. TDK Monozukuri Tradition Seminars are a manifestation of this profound wish.

Summary of Efforts in FY 2014
In fiscal 2014, TDK promoted human resource development,
which is an important activity from the CSR perspective, in accordance with the priority themes of “Develop human resources
to promote manufacturing reform,” “Develop global human resources,” and “Promote in-house awareness of CSR.” Regarding“promotion of diversity,” which has been advocated as a theme
so far, TDK first of all has been giving priority to the urgent issueof “cultivating global human resources.” TDK has been promoting the three above-mentioned themes with the aim of cultivating
autonomous employees who are capable of thinking things out
for themselves, courageously facing challenges, tenaciously responding to changes in an optimum manner, and seeing things
through to the finish.

Topic

Launch of the Global HR Department

1

Organization of the Global HR Department
General Manager, Human Resources Group

General Manager,
Global HR
Department

GeneralManager,Labor
Administration
Department

GeneralManager,
Personnel
Affairs
Department

Planning
South
Japan Europe China ASEAN
office
Korea

Voice

GeneralManager,
Human
Resource
Development
Department

U.S.

Role of the Global HR Department

Over the years our customers have expanded across the globe, requiring us to serve
them better from a global point of view. The
Global HR Department will be active in promoting personnel exchange across national
borders as we aim to establish a unified
global human resource development andtraining policy. We plan to provide trainingthat comprises not only language skills andfunctional knowledge but also managerial
skills for laying the foundation for strong future leaders.

25

TDK CSR REPORT 2014

Our primary goal is to create an environment that brings out the strengths of every
employee and provides training to take theirskills to a higher level. Recognizing thathuman resources are a company’s mostvaluable asset, I believe that making outstanding products and technologies will depend heavily on this environment building.
Our department can further magnetize the“One TDK” spirit and help to make TDK atruly attractive global enterprise that will allow us to cultivate and draw upon a wealth oftalent.

Andreas Keller
General Manager,
Global HR Department,
Human Resources Group,
TDK Corporation

Development of Human Resources

Development of Human Resources

Topic

TDK launched the Global HR Department in September 2013 to span Japan,
Europe, China, the ASEAN countries, South Korea, and the United States. The
department’s aim is to optimize the synergy effect in the TDK Group by strengthening global networking in human resource functions and expanding personnel
exchange among sites.
At present, specific measures include expansion of the Overseas Trainee
Program, which is a program for personnel dispatching and training among sites;
the establishment of an infrastructure of common and global educational tools
and programs; the improvement of transparency in personnel deployment; andthe introduction of a management system that helps to place “the right people in
the right positions.”
In the future, the establishment of an environment at the global as well as thedomestic level that fully brings out the potential of every employee will be important in order to achieve the sustainable growth of TDK and realize our ranking
as the world’s number one electronics components company. The launch of the
Global HR Department is a major first step in this direction.

2

Shop-floor practice

Voice

The final seminar class, attended by the president, features
reports.

Participation in TDK Monozukuri Tradition Seminar

I think the foundation of the spirit of monozukuri, which is what the TDK corporatemotto is all about, is to foresee market needs
based on material technology and develop
and supply the best products for customers.
Moreover, TDK’s starting point is the “shopfloor approach,” which means that not only
manufacturing but also not directly involved
divisions, engineering, development, andsales, are always cooperating with one
another.
In the TDK Monozukuri Tradition Seminarprogram, I visited four domestic sites andone overseas site together with the othertrainees to inspect the production process
and plant management there. I had visited
some of the sites before, but still, through thediscussions among trainees and other activities, things that I had not noticed before now
became apparent. If we can share knowhow in common areas, such as production

methods and element technology, we can
expect great improvements in the TDKGroup as a whole. I realized how important
it is to enforce thorough manualization andbuild a system so that workers can explain
goals, procedures, and workmanship.
Making use of my experience in the seminar, at TDK Xiamen, where I am now working, I am planning to launch a kind of Xiamen
version of the TDK Monozukuri Tradition
Seminar, in which selected persons fromseven manufacturing sections and indirect
sections in four business groups will gather,go round all the processes together, andformulate reform proposals. Amid the current globalization of business, I think it isextremely important to convey TDK’s spiritof monozukuri to local managerial-level staff
through such efforts. I believe that this willlead to the solution of customers’ problems
and in turn society’s problems as well.

Tamotsu Aiba
Chairman,
TDK Xiamen Co., Ltd.

TDK CSR REPORT 2014

26

CASE

IMD Seminars Aimed at Fostering Leaders from Around the World
The series of IMD Seminars was inaugurated in 1997. It is aimed at managerial candidates
at overseas affiliates of the TDK Group, with the intention of putting human resources ona truly global footing and strengthening solidarity in the Group across national borders.
Each seminar lasts for about a week, with all participants lodging together at the venue.
The seminar program comprises lectures and workshops to foster a deeper understanding of corporate ethics, widen the horizons of participants, and enhance their awarenessof management viewpoints. The creation of a global human network is another objective.
Former participants of the program have gone on to become presidents of overseas affiliates, demonstrating its importance for human resources development in the TDK Group.

Topic

3

IMD Seminar: International Management Development Seminar

Voice

Somruedee
Promtep

From an IMD Seminar Participant

Development of Human Resources

the same DNA also to our group.
The fact that I was able to meet TDK members from various countries around the worldand exchange opinions with them also was agreat benefit, as was the opportunity to learn
in depth about topics such as how to become a good leader and how to effectively
communicate with the people around you. I
realized that I still have a long way to go, but
I want to apply what I learned to my future
work as well as my daily life.

Topic

Voice

4

From June to July 2013 face-to-face talks between President Takehiro Kamigama andyoung employees took place at six sites in Japan. The discussions were planned withthe aim of actively incorporating the frank opinions and suggestions of young employees
in management. First of all group discussions were held at sites in Japan, and on thebasis of the contents of these discussions, six sites were chosen as venues for face-toface talks. President Kamigama visited these sites and engaged in talks for more than
two hours each with both group and individual participants. The discussions covered a
range of topics, including the present state of TDK, the problems it faces, and its future
image.

Participation in Face-to-Face Talks

Through the discussions with President
Kamigama, I realized that my own work horizons are very narrow. Rather than just adhering to a certain theme, I strongly felt theneed to look at products as a whole and themarket as a whole in development.
Another thing I learned was that the president has the same feelings as us concerning various issues and future goals. When an
organization gets bigger, it tends to become
more difficult for the opinions of ordinary

27

TDK CSR REPORT 2014

employees to reach the top, so such opportunities are very valuable. I think that deepening communication like this in the divisionand between divisions will lead to the creation of greater value.
Personally, I was very impressed by thepresident’s encouragement for us to makemistakes while we are still young. As an engineer, I want to challenge many things andlearn from mistakes rather than being afraidof making them.

Summary of Efforts in FY 2014
Regarding CSR response to customers, TDK has been implementing CSR self-checks at the main production sites of the TDKGroup every year since 2009. In addition, TDK responds to CSR
audit requests from customers, which have been increasing inrecent years, and conducts voluntary internal CSR audits. In response to any issues detected, TDK develops risk assessment
tools and takes other measures as necessary.
In the promotion of CSR procurement, TDK uses the existing
Supplier Partnership System and requests business partners toanswer CSR check sheets in order to understand the situation. To

Topic

Face-to-Face Talks between the President and Young
Employees

Yuya Ishima
Assistant Manager,
Multilayer Components
Business Unit,
Magnetics BusinessGroup,TDK-EPC
Corporation

As a midstream company, TDK promotes social and environmental considerations in both the upstream
and downstream supply chain. Activities were steadily developed in fiscal 2014 as well.

1

Implementation of
Supplier CSR Audits

further improve activities, TDK has revised the CSR check sheets
and conducted CSR audits at main suppliers.
Regarding its response to conflict minerals, TDK has formulated a conflict mineral policy, publicized it both inside andoutside the company, and reviewed its survey and reply setup.
Recognizing that the cooperation of industrial circles is essential to solve this problem, TDK also participates in Responsible
Minerals Trade Working Group as a managing company.

Topic

2

Implementation ofConflict Minerals
Supplier Surveys

At TDK Xiamen we implement CSR audits at supplier compa-

In order to conduct procurement in line with TDK’s policy onnies in response to requests from customers. First of all, we se-conflict minerals, we select the purchased products to be sur-lect the suppliers to be audited in consideration of such factors

veyed, request suppliers to cooperate in the implementation

as their importance and our degree of dependence on them inof surveys and replies so as to identify refineries handling the

product delivery to customers. After receiving guidance fromminerals concerned, and register the results in TDK’s own da-

the TDK head office on such things as audit procedures, wetabase. Since many suppliers have almost no understanding ofstarted audits in July 2013. By March 2014, we had conducted

the problem of conflict minerals, the first challenge is to makeaudits at 16 companies.

them aware of the issue and understand the importance of the

As a result of the audits, I feel that awareness of the mean-

survey. Sometimes we make specific suggestions regarding

ing and necessity of CSR has deepened at suppliers. At thesurvey methods and the like, thereby endeavoring to enhancesame time, though, regarding several of the problems pointed

the survey recovery ratio.

out in the audits, it is difficult for suppliers themselves to makeThe reality, however, is that even if a purchased productimprovements. For example, they have commented that, “If we

contains materials that might be a source of funding for armed

improve the working environment for employees, it will be dif-

forces, we have not reached the stage of being able to give

ficult for us to meet delivery dates,” and, “If costs increased, weclear instructions regarding specific action. Eventually, I thinkwould have to reflect them in prices.” The clarification of TDK’s

a clause stipulating that “No materials funding armed forces

response to these conditions will be an issue from now on.

are used” should be included as a condition for selection when

Making use of this experience and the knowledge I have

Society and Environmental
Considerations in the Supply
Chain

I am in my 17th year with the company, andam working as the manager of the quality assurance team in the manufacturing division.
Hearing the background story related
to the founding of TDK is one of the things
that impressed me most at the IMD Seminar.
The realization that contributing to society
through one’s work has been the defining
philosophy of the company since its very
beginning made me feel inspired and motivated. After my return, I immediately told myteam members about it, wishing to convey

Department Manager,
Quality Assurance Dept.,
TDK (Thailand) Co., Ltd.

3Society and Environmental
Considerations in the Supply Chain

concluding a new purchase agreement.

gained in the CSR internal auditor training, I want to improve the

My involvement in these surveys has been a good opportu-

quality of auditing in the future and contribute toward raisingnity for me to think deeply about what kind of people my work

the CSR level in suppliers, including entrenchment of the PDCA

impacts and in what ways. In the future, I want not only to aim

cycle.

to achieve goals but also to be constantly aware of the people
who exist beyond them.

Meijuan Li
Section Manager,
Procurement Department,
Corporate Planning HQ,
TDK Xiamen Co., Ltd.

Chikako Abe
Environment & Quality Section,
Procurement Management
Department,
Procurement & Logistics Group,
Manufacturing HQ,
TDK Corporation

TDK CSR REPORT 2014

28

CASE

4

Symbiosis with the Global Environment
In order to promote environmental activities, TDK has formulated the TDK Environmental Charter as theenvironmental policy of the TDK Group as a whole and aims to contribute to sustainable development.
In accordance with the TDK Environmental Action 2020 initiative, announced in fiscal 2012, TDK
is conducting activities toward the goal of becoming the first company in the electronic components
industry to achieve carbon neutrality.

Summary of Efforts in FY 2014

TDK’s Goal of Achieving Carbon Neutrality

Regarding the reduction of CO2 emissions in production activities(environmental load), TDK placed priority on strengthening energysaving measures in China, which accounts for about 50% of TDK’s
CO2 emissions, as well as establishing a setup to promote independent activities and coordinating energy-saving activities with thecost-reduction efforts of business sites in China. As a result, the TDKGroup’s emissions in fiscal 2014 amounted to 1.063 million tons,
which was greater than the target of 1.09 million tons.
Regarding the expansion of CO2 emission reductions by products(environmental contribution), as a result of expanding the calculable
scope of offset environmental contributions by product group andfield, emissions in fiscal 2014 amounted to 886,000 tons.

CO2 emissions in production activities (environmental load)- CO2 emission reductions by products (environmental contribution) ≤ zero

1

Energy-Saving Activities
Achieve Substantial
Reduction of CO2
Emissions at TDK Xiamen

In China the 12th Five-Year Plan, which started in 2011, sets
specific energy-saving goals for local governments and companies. TDK Xiamen has been conducting various energy-saving
activities in response to its assigned target of reducing energy
consumption by 1,750 tons a year (standard coal equivalent).
Specifically, TDK Xiamen has taken such measures as thereplacement of superannuated incidental equipment, the installation of motor inverters, and the use of residual heat retrieved from compressors. As a result, we realized a reduction
in energy consumption of 2,000 tons a year (standard coalequivalent) in 2013, which was far higher than both the target
set by the Chinese government and the goal for CO2 reductions requested of manufacturing sites by the TDK Group. We
have also received subsidies from the Chinese government for
the replacement of fuel boilers and a project to improve turbo
refrigerators.
We aim to achieve even more results from now on by sharing and utilizing best practices at other sites and make efforts to publicize them so as to further raise the motivation of
employees.

Linhai Shen (left)
Assistant Manager,
Engineering Department

Yingzhong Zhao
(right)Senior Engineer,
Engineering Department,
TDK Xiamen Co., Ltd.

29TDK CSR REPORT 2014

1.063 million tons

Topic

2

CO2 emission
reductions by products(environmental
contribution)

886,000 tons

Visualization ofEnvironmental
Contributions Boosts
CompetitivenessWe have calculated the offset environmental contribution oftransformers, which are one of the products handled by ourcompany. In the past also, we received high marks from customers from the perspective of consideration for the environment by utilizing TDK’s strength in the development of magnetic
materials to supply unique products not available from othercompanies. But now, thanks to the visualization of offset environmental contributions, we believe it will be possible for us topropose even more competitive products.
Transformers are used in a variety of ways and are essential
for daily living. As well as large household appliances like air
conditioners, refrigerators, and washing machines, they can befound in audiovisual equipment like televisions and recorders.
Precisely for this reason, although the contribution of individual
products might be tiny, together they have an enormous impact on the environment. It is extremely important, therefore, tobe aware of their contribution to the environment at the design
stage.
As well as the innate characteristics of TDK’s transformers interms of materials, manufacturing, and design, from now on, in
addition to waste-free design and easy-to-make design, we willseek to realize environment-considerate design.

All around us today, human rights and environmental issues relevant to the supply chain have emerged as astrong area of interest not only for NGOs, but for regulatory authorities as well. For companies, meanwhile,these challenges represent the most difficult area to address among the many CSR themes demanding our attention. This year’s TDK CSR Report tackles the subjectof supply chain CSR head on, providing a special feature of truly thoughtful content. I give the highest marks
to the article’s attempt to shed light on the efforts being
mounted behind the scenes to effectively cope with thistough demand. The message that multifaceted endeavors are critical for contemporary corporate managementin the relations with society was conveyed to readers ineasily graspable terms. I found particularly stimulating
the details of the internal CSR auditor training, as wellas initiatives aimed at maintaining and strengthening
response capacity by autonomously seeking out internal audits by third-party organizations when CSR audits are not conducted by customers. In my view, boththese areas closely reflect the commitment pledged by
TDK President Takehiro Kamigama: “Strive to incorporate CSR thinking throughout the entire supply chain.” I
also find highly constructive the clear mention of specificproposals, rooted in the experience of dealing with such
issues at TDK itself, for deploying a system in support ofindustry-wide sharing of audits and other key information. I very much look forward to continued strong leadership by TDK in spearheading the formulation of thistype of new rule system.
Next, I wish to touch upon the launch of the Global
HR Department. For companies, and especially those
actively engaged in global business development, furnishing both fair evaluations and equal opportunities for
growth, regardless of nationality, employment systems orother parameters is one key pillar of social responsibility.
The start of the Global HR Department is a vital first stepin that direction.

Another area deserving mention concerns generating social value through TDK technology. For TDK, oneof its key strengths lies in the capacity to “Create whatsociety demands from scratch,” and, “Supply uniqueproducts available at no other company.” Stated within
the TDK Code of Conduct is the goal: “Resolution of social issues.” President Kamigama also goes on record
with his resolve to contribute to working out solutions tofuture-oriented social issues. The act of supplying theworld with totally new technology and products will pave
the way to lasting solutions for social challenges. Thisis because social issues act as beacons of the emerging direction for development of new technologies andproducts. The key for TDK in generating value over thelong term is the ability to strike a working balance between the resolution of social issues and earning stellar
evaluations on the marketplace. From that perspective, the successful visualization of the environmental
contributions made by transformers is an achievementthat should never be underrated. In my view, efforts toresolve social issues must always be accompanied byequal attempts to translate those solutions into concrete
market value.

Third-Party Opinion

Symbiosis with the Global
Environment

Topic

CO2 emissions in
production activities(environmental load)

Third-Party Opinion

Finally, I want to briefly state my expectations for the
future. Regarding initiatives focused on the social responsibilities of the supply chain, I support disclosureof objective data, pertaining to audit results and otherareas, to the greatest extent possible. For the global human resources system, I heartily encourage the issuingof regular reports on the progress made in promoting operation in that format from here on. Finally, I believe that
global business management is defined by the enduring
mission of grasping and absorbing the values of different peoples and societies, in a perpetual push to create
commensurate global values for companies themselves.
Taking this to heart, I am confident that TDK’s CSR is set
to emerge as the cornerstone of this precious challenge.

Tomohiro Furuichi(left)

Katsuhiro Ishigaki(center)

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

Masaki Matsushita(right)Coil Products Department,
Transformer & Ferrite BU,
Magnetics Business Group,
TDK-EPC Corporation

TDK CSR REPORT 201430

TDK CSR REPORT 2014
English version

TDK Corporation
Shibaura Renasite Tower,
3-9-1 Shibaura, Minato-ku, Tokyo 108-0023
CSR Promotion Office
TEL : +81-3-6852-7115
http://www.global.tdk.com/

TDK CSR REPORT 2014
English version