CHIYODA GROUP

Sustainability Report 2017

Corporate Proﬁle (as of March 31, 2017)

Overseas Subsidiaries and Oﬃces & Major Domestic Group Companies(as of April 1, 2017)

Company Name Chiyoda Corporation

Established

January 20, 1948

Paid-in Capital

43,396 million yen

Number of Employees

5,367 people (Consolidated)

Main Business Fields

Engineering and Construction

Main Oﬃces

Chiyoda Global Headquarters(CGH)

Project Experience■Xodus Group (Holdings) Ltd.

The Netherlands■Korea Representative Oﬃce

Saudi Arabia
Qatar

7,468

5,899

4,029

4,461

4,036

UAE

17%

134

83%

3,989

Revenues by Industry (FY2016)
34

17%
-411
2012 2013 2014 20152016 (FY)2012 2013 2014 2015 2016 (FY)■ Gas Development/Processing/Receiving■ Refinery/Petrochemical/Metals■ Pharmaceuticals/Biochemistry/Chemicals■ Environment/New Energy/Infrastructure2%■ Others

Editorial Policy■ CSR Activity Report Policy
The Chiyoda Group provides comprehensive reporting on its CSR activities, including detailed information presented on the Chiyoda Corporation
website.
In addition, the Group has published this digest version of the Group's FY2016 report, highlighting the latest activities.
The contents of these reports are elaborated and compiled based on the Group Corporate Philosophy and CSR Vision incollaboration with the members of the Group Liaison Meeting on CSR and those responsible for CSR in Group companies in Japanand overseas. For further details, including particulars on governance, please refer to the websites and other sources below.
■ Applicable Period: FY2016(April 1, 2016 to March 31, 2017, unless otherwise speciﬁed)■Middle East Headquarters Doha Oﬃce
■Chiyoda Almana Engineering LLC■Chiyoda Petrostar Ltd.

Engineering■ Website
Corporate Governance Policy
https://www.chiyoda-corp.com/
company/files/160623_CGPr.pdf

Comprehensive reportingon the website

Sustainability
Report
FY2016
activity highlights

Annual reports are published in
English particularly for shareholders and investors overseas.
Major topics relating to CSR
activities are also introduced.

The Chiyoda Corporation
is a signatory of the United
Nations Global Compact.

1

CHIYODA GROUP Sustainability Report 2017

The Chiyoda Corporation
has been included in the
FTSE4Good Index Series,
designed by FTSE Russell(United Kingdom), index ofsocially responsible investment.

■Chiyoda Oceania Pty Limited■Chiyoda Human Resources International (Pte.)Limited■Chiyoda Singapore (Pte.) Limited■Chiyoda do Brasil
Representações Ltda.

■Chiyoda Malaysia Sdn. Bhd.
■Chiyoda Sarawak Sdn. Bhd.

■ Chiyoda Kosho Co., Ltd.

Engineering, construction, and maintenance of industrial■ Chiyoda TechnoAce Co., Ltd.

Consulting, planning, design, execution, test operation, and otherequipment and facilities of every type; insurance business,

services for civil engineering and construction work on pharmaceuticaletc.

and petroleum facilities

http://www.cks-ykh.co.jp/

http://www.cta.chiyoda.co.jp/■ Chiyoda System Technologies Corporation■ Chiyoda U-Tech Co., Ltd.

Feasibility studies and consulting for energy, oil, chemical, andof electrical, instrumentation, and control systems;

environment-related plants as well as other various types of industrial

consulting, development, and operation of integrated IT

facilities

systems; business relating to social infrastructures

http://www.utc-yokohama.com/

http://www.cst.chiyoda.co.jp/

The scope of this report extends to all Chiyoda Group companies. The names ofBusiness Support

Chiyoda Kosho Co., Ltd.
（CKS）
Chiyoda System Technologies Corporation（CST）
Chiyoda TechnoAce Co., Ltd.
（CTA）
Arrowhead International Corporation（AIC）■ Arrow Business Consulting Corporation
Consulting and business outsourcing for ﬁnance,

Chiyoda Almana Engineering LLC（Chiyoda-Almana）

Travel agent, air cargo, materials export, and other related services
http://www.arrowhead.co.jp/■ Arrow Human Resources Co., Ltd.

■ Chiyoda Business Solutions Co., Ltd.

and education and training

Chiyoda Philippines Corporation（CPh）■ Arrowhead International Corporationaccounting, and tax services

Temporary staﬃng, placement consulting, outsourcing,Outsourcing services and consulting for HR and facility
management

http://www.ahr.co.jp/

Chiyoda & Public Works Co., Ltd.
（CPW）
Chiyoda Singapore (Pte.) Limited（CSL）
L&T-Chiyoda Limited（L&TC）INDEX

Major Domestic Group Companies

This Handbook has been edited to include the“Corporate Philosophy,”the“CSR Vision,”the“Code of
Conduct,” the “Compliance Manual (Employee's
Practical Guide),” and other basic policies of the
Chiyoda Group. It is made public on the Group website
and also made known to employees.

The Chiyoda Corporation has
been included as one of theconstituent companies in the
FTSE Blossom Japan Index
designed by FTSE Russell(United Kingdom).

Corporate Proﬁle and Editorial Policy

1

Overseas Subsidiaries and Oﬃces &Reference
Chiyoda Group CSR Handbook

Reference
Annual Report■PT. Chiyoda International Indonesia

Engineering, procurement, construction, and maintenance■ Group Companies Covered by the Reportabbreviations, please refer to the details below.

Chiyoda Group Sustainability

Corporation■Chiyoda Philippines Corporation

Australia■Abu Dhabi Oﬃce
■Chiyoda-CCC Engineering(Pte.) Limited

Group companies are given in an abbreviated form in the report. Regarding those■ Website
Sustainability」
https://www.chiyoda-corp.com/csr/■■Chiyoda International■Beijing Oﬃce
■Chiyoda Corporation(Shanghai)

Brazil■Chiyoda Mozambique
Limitada■ LNG Plants

69%

Indonesia

USA

Mozambique

1%

5%
6%

2016 (FY)

Philippines
Thailand
Malaysia
Singapore■L&T-Chiyoda Limited

4,810

3,518

2012 2013 2014 2015

Myanmar■ Domestic●Chiyoda Global Headquarters

China

India

■ Overseas

110

Japan

Korea

Revenues by Region (FY2016)

161

6,115 6,037■ Operation Support Base■Chiyoda (Thailand) Limited

Italy

Net Income (Losses)■ Project Execution Base■Chiyoda Corporation Netherlands B.V.

UK

Revenues■ Engineering Center■Chiyoda & Public Works Co., Ltd.

■Milan Representative Oﬃce

Over 60 countries worldwide(One Hundred Million Yen)

■ Sales Base
■ Procurement Center

Koyasu Oﬃce & Research Park

Consolidated Financial Highlights

New Orders

Chiyoda's Global Network (Major Overseas Subsidiaries and Oﬃces)

The Chiyoda Corporation isthe constituent company of
SNAM Sustainability Index.

INDEX

Feature 1

Vision 1

Stakeholder Dialogues

A Reliable Company

15

Vision 2
Environmental Initiatives

2

Top Message

3

History and Future of the Chiyoda Group

5

The Story of Value Creationby the Chiyoda Group7

CSR Vision

9

11
Feature 2

17

Vision 3
Social Contributions
through Business Activities

19

Vision 4
Respect for Human Rights

Development Project Initiatives
on the Far Northern Energy Frontier

21

Vision 5

13

Commitment to Fairness

24

The Chiyoda Group's Social Contribution
Activities

25

CHIYODA GROUP Sustainability Report 20172

Top Message
The Chiyoda Group’s Backgrounds as a Social Entity
Chiyoda Corporation was founded in 1948 for the purpose of contributing to society throughengineering, making excellent use of its sophisticated technologies. It has since been engaged in theengineering and construction of plants and facilities such as in petroleum reﬁning, gas processing andpetrochemicals, contributing to the development of industry in Japan. We have also made forays into
countries in the Middle East and Asia, where we have also been striving to contribute to the developmentof society with our reﬁned technical capabilities by providing each region with infrastructure tailored to theneeds of the times and the regions. In those backgrounds, we have consistently continued engineering
operation based on the core of our corporate philosophy of “harmony between energy and theenvironment.”

The Chiyoda Group’s Corporate Social Responsibility (CSR)
Recently, the global requirements for corporate social responsibility (CSR) have changed signiﬁcantly.
As corporate activities become increasingly globalized, new demands are emerging for the resolution ofsocial issues such as respect for human rights, the correction of inequality, environmental preservation andcompliance such as anti-corruption. To address these issues, expectations are growing for the businesssector and its resources. The goals and directions to be followed by companies are shown through the
Sustainable Development Goals (SDGs)*₁, adopted by the United Nations in the year 2015, and the Paris
Climate Agreement, in which the international community agreed to aim for a carbon-free world as ameasure to combat climate change. As shown in our corporate philosophy and CSR visions, commitment
to UN Global Compact*₂ joined in 2012, there are many areas in which our technologies and humanresources could resolve these issues.
We believe that we can satisfy these requirements through the Chiyoda Group’s CSR activities tocontribute to the creation of a better society by having a correct understanding of the requirements of thetimes and our stakeholders and making eﬀorts to solve social issues through engineering.

To Achieve Our Ultimate Goal of Becoming a Reliable Company
As our corporate activities have been increasingly global in scope, we are dedicated to developing thecircumstance in which employees as well as other stakeholders such as customers, business partner andlocal communities can participate and play an active role, regardless of their gender, nationality, age orreligion in a spirit of respecting human rights, above all.
In addition, Chiyoda Corporation made the transition to a“company with the audit and supervisorycommittee”in June 2016 based on the Corporate Governance Policy, seeking to increase the fairness andtransparency of business management and make decisions more promptly. Through this action, we havefurther enhanced our corporate governance system by appointing three independent outside directors. Asa group, we will solidify the foundations for our operations and work on the medium-tern management plan
starting on the ﬁscal year 2017 to contribute to a sustainable society.
August 2017
＊1: SDGs are a set of global goals to be achieved by 2030,
adopted at the UN Sustainable Development Summit
in September 2015. They are common goals for theinternational community, consisting of 17 goals and
169 targets, for both developed and developing
countries to tackle to eradicate poverty and realize asustainable world.

Chairman of the Board

3

CHIYODA GROUP Sustainability Report 2017

＊2：UN Global Compact was announced by then UN
Secretary-General Koﬁ Annan in an address to the World
Economic Forum held in 1999. It is a principle-based
framework for businesses, stating ten principles in theareas of human rights, labor, the environment andanti-corruption. Chiyoda has signed up in UN Global
Compact in 2012.

President & CEO

CHIYODA GROUP Sustainability Report 20174

History and Future of the Chiyoda GroupWe were founded in 1948, during the period when Japan was starting to make powerful moves toward its postwar recovery. With "serving society through technology" as its founding motto, the company has kept moving forward in accordancewith the Corporate Philosophy of "harmony between energy and the environment" and in unswerving awareness of therequirements of the international community. As we address the issues of society with our technological capabilities, we
continue aiming to make even greater advances.

1960s
SocialContext

・1945 Mitsubishi Oil Co. reﬁnery in Kawasaki
is heavily damaged
The Second World War ends
・1950 Domestic reﬁneries reenter operation,
starting the“Age of Oil”

・ Market changes due to two times of oil crisis

Dawning

GrowthProject Execution and Technology Development founded on
Chiyoda Group
History

Major Projects
Awardedand Technology
Development
Achievements

・ 1948 Founding of Chiyoda Corporation
・ Contributions to the postwar reconstruction of Japan's
domestic industry
・ Participation by means of engineering in oil andpetrochemical industries
・ Start establishing footholds for overseas expansion

・ Start environmental initiatives in conjunction with domestic economic growth・ Respond to the diversiﬁcation of plant demands led by oil producing countries
・ Overseas expansion shifts into high gear in line with promotion of Group-wide
internationalization
・ Start initiatives for laboratory facilities projects

・ Construction to rebuild the
Kawasaki reﬁnery of Mitsubishi
Oil Co., Ltd. (present JXTG Energy)
・ New reﬁnery for Mitsubishi Oil
Co., Ltd.
・ Fertilizer(Ammonia/Urea) plantfor India

・ Construction of desulfurization
units for the petroleum reﬁnery
・ Consecutive domestic orders forﬂue gas desulfurization units
・ Jeddah and Riyadh reﬁneries,
Saudi Arabia
・ Reﬁneries for Nigeria

Reconstruction of
the Kawasaki reﬁnery

2000s

1980s
・ Overseas production by Japanese manufacturers
accelerates due to the Plaza Accord (high yen era)

Resurgence & Transition

・ oil prices soar and global LNG demand increases
・ A carbon-free society and environmental conservation
one globally demanded・ More stringent environmental controls by the United Statesleads to the consective orders to license CT-121 technology

Contributions

Further Development

to thesustainable“Energy and Environment in Harmony”
・ Accelerate overseas expansion and move to global
operations
・ Expand into ﬁelds of general industrial facilities andnon-ferrous metals
・ Initiatives for LNG projects shift into high gear・ Participation in national oil stockpiling projects

Copper smelter for
P.T. Smelting Co.

developmentof society

・ Execution of LNG mega projects
・ Execution of projects in gas value chain
・ Development and demonstration operation of environmental
conservation technology
・ Development of renewable energy-related business・ Participation in photovoltaic and solar thermal
power generation projects
・ Development of SPERA Hydrogen®System technology
for large-scale transportation of hydrogen・ Expansion of overseas licensing of ﬂue gas
desulfurization technology

CT-121 Bowen 3 SGR JBRRiyadh reﬁnery for Petromin (Saudi Arabia)

Photovoltaic power generation facility for Mitsui & Co., Ltd.
Kaduna reﬁnery for NNPC (Nigeria)
Arun natural gas liquefaction
plant for Pertamina (Indonesia)

Mizushima grass-roots reﬁnery for Mitsubishi Oil Co., Ltd.

Tsukuba Research Laboratories, Upjohn Pharmaceuticals Limited

Complete construction of Fukui national
petroleum stockpile baseQatar Gas Operating Co., Ltd.

Mizushima LNG receiving terminalfor Mizushima LNG Co., Ltd.

Sakhalin Energy Investment Co., Ltd.

Courtesy of Sakhalin Energy Investment Company

5

CHIYODA GROUP Sustainability Report 2017

CHIYODA GROUP Sustainability Report 2017

6

The Value Creation Story by the
Chiyoda Group

Realization of the Corporate Philosophy

The Chiyoda Group pledges to continue as an enterprise that oplimizes the use of
the cutting-edge technology and human resources to create value for society. We
have been pursuing business according to our declared Corporate Philosophy of"harmony between energy and the environment" and with our CSR Visions as ourcore value. In order to respond to the requirements of global markets and communities, we aim to be a global top-tier provider of comprehensive engineering services
in both energy and environmental ﬁelds by implementing our Medium-term management plan "Mirai Engineering - A Grand Opportunity for the Future".

- The Mission for us to Accomplish -Enhance our business in aiming for harmony between energy andthe environment and contribute to the sustainable development ofa society as an integrated engineering company through the use of
our collective wisdom and painstakingly developed technology.

Medium-term management plan

“Mirai Engineering”derived from integration of three growth

No Poverty

Zero Hunger

Aﬀordable andClean Energy

Decent Workand Economic
GrowthClimateActionLife Below
Water

Good Healthand Well-Being

Quality
Education

Gender Equality

Clean Waterand Sanitation

Industry,
Innovation,and Infrastructure

ReducedInequalities

Sustainable
Cities andCommunities

Responsible
Consumption
and Production

Peace, Justice,and Strong
Institutions

Partnerships
for the Goals

strategies
Life on Land

Goals for Sustainable
Development by 2030
That the World has
Agreed to Pursue

Energy Solutions- Build energy value chain business -Environmental- Expand global
engineering

Solutionsenvironmental
business -・ Achievement of SDGs

・ Enhancement of Corporate Value"Mirai Engineering"

AntiCorruption

GlobalWarming

ClimateChangeHumanRightsEconomic
Disparity

Integrated Engineering & Service to contribute to asustainable society creating harmony between Energy
and Environment through combination of CHIYODA’scomprehensive strengths and innovative digitaltechnologies

Social Issues

Appropriate
Employment

Chiyoda Group
Businesses
Corporate Philosophy

CSR Vision

Technology andbusiness model innovation- Develop new business model for a digital society -What are the SDGs (Sustainable Development
Goals)?
These are goals that need to be realized by the year 2030 in order toachieve a sustainable development of society. They consist of 17 major
goals and 169 targets that were adopted by the United Nations General
Assembly in September 2015 to provide a basic framework for action in theinternational community of both developing and developed countries.
As a member of the community, the Chiyoda Group is responding to thismovement by engaging in actions intended to contribute to the achievementof the goals.

Individual Issues in
Local Communities

Securing Energy
Resources

In this report, we are reconﬁrming our own corporate activities anddisplaying icons for the relevant goals side by side with such activities.

Global Standards
ISO26000
United Nations Global Compact● SDGs● Paris Climate Agreement● United Nations Convention
on Biological Diversity●●

7

CHIYODA GROUP Sustainability Report 2017

The Chiyoda Group Supports the SDGs .

CHIYODA GROUP Sustainability Report 20178

CSR Management

Our Shared Values

CSR Vision

The Chiyoda Group's CSR Vision1

engineering company, is to contribute to the sustainable developmentof society through our business activities. By furthering the below
activities in a sustained manner, we strive constantly to enhance ourcorporate value and to be a corporation that earns the trust andaﬃnity of all our stakeholders.

ISO26000
Core Subjects

UN Global Compact

Consumer━(customer)●

issuesPrinciple 7: Businesses should support a

Environmental Initiatives
We will work to remain an invaluable company
to society by utilizing reﬁned technologies topromote harmony between the global environment and economic and social activities.

Action Policies●

A Reliable Company
We strive to be a reliable company to our customers and other business partners by providing
world-class technologies and knowledge.

2

One of our primary aims in the Chiyoda Group, as an integrated●

precautionary approach to environmental
challenges;
Principle 8: undertake initiatives to promote

The environment

greater environmental responsibility; and●Provide industrial plants that earncustomer trust through engineering ofoutstanding quality
Share our CSR principles with suppliers and other business partners

Develop and provide environmentally friendly energy and conservation
technologies
Conduct business activities that contribute to environmental conservation

Principle 9: encourage the development anddiﬀusion of environmentally friendly technol-

●

●

●

3

Through our engineering business in Japan andoverseas, we contribute to local communities inways including human resources development,
technology transfer and environmental protection.

●

involvement and━development

Technology development of hydrogen energy

●

●

●

4

Principle 1: Businesses should support and respect
the protection of internationally proclaimed
human rights; andRespect for Human Rights
We are dedicated to respecting the human rights
of all people. We will create a corporate culture
where the diversity, individuality and character of
employees are respected, where people are
motivated to do their best, and of which employees and their families are proud.

Principle 2: make sure that they are not complicit
in human rights abuses.

Human rights

Labor practices

Principle 3: Businesses should uphold the freedomof association and the eﬀective recognition of theright to collective bargaining;

Good Healthand Well-Being●

Contribute to society through integrated engineering business activities
Enhance social contribution activities
by providing knowledge and labor

Added value enhanced by proposals using
integrated 3D design technology

Eﬀective utilization of oil ﬁelds●

Community

Industry,
Innovation,and Infrastructure●●

Social Contributions throughBusiness Activities

Build relationships of trust with our cutting-edge
FA control technology

Next-generation clean energy

ogies.

Sustainable
Cities andCommunities

The engineering company's mission in society

●

●

●

Related SDGs

FY2016 Activities

The dissemination of technology toprevent air pollution

Environment-conscious activities in project execution●

Create a lively and energetic working environment and help employees develop their talents
Instill in everyone involved that safety
is a core value

●

●

●

Principle 4: the elimination of all forms of forced
and compulsory labour;

Industry,
Innovation,and Infrastructure

Aﬀordable andClean Energy

ClimateActionResponsible
Consumption
and Production

ClimateActionAﬀordable andClean Energy

Sustainable
Cities andCommunities

ClimateActionAﬀordable andClean Energy

Sustainable
Cities andCommunities

ClimateActionSustainable
Cities andCommunities

ClimateActionIndustry,
Innovation,and Infrastructure

Providing optimized operation through cutting-edge
technology

Sustainable
Cities andCommunities

Responsible
Consumption
and Production

Developing excellent human resources throughtechnology transfer

Decent Workand Economic
GrowthReducedInequalities

Developing human resources with the goal of establishingindustrial infrastructure

Quality
Education

Safety ﬁrst

Gender Equality●

Responsible
Consumption
and Production

Initiatives for changes in work style in FY2016
Safety ﬁrst crisis management support to prepare forall emergencies
Reinforcement of corporate strengths by development of
global human resources

Partnerships
for the Goals

Decent Workand Economic
GrowthSustainable
Cities andCommunities

Quality
Education

Decent Workand Economic
GrowthReducedInequalities

Peace, Justice,and Strong
Institutions

Principle 5: the eﬀective abolition of child labour;andPrinciple 6: the elimination of discrimination in
respect of employment and occupation.

59Commitment to Fairness
We are dedicated to achieving even greatertransparency and stability by conducting ouroperations fairly in accordance with the highest
ethical standards.

CHIYODA GROUP Sustainability Report 2017

Principle 10: Businesses should work against

Organizational
governanceFair operating
practices●

corruption in all its forms, including extortionand bribery.
●

Conduct business activities based onstrict compliance and a high degreeof transparency●

Initiatives to prevent misconduct

Conduct a thorough risk management
programCHIYODA GROUP Sustainability Report 2017 10

Feature

1

Stakeholder Dialogues

Global Trend of CSR and Expections to
the Chiyoda Group from Stakeholders
Looking at the world, we see that the circumstances of CSR are constantly undergoing change. We invited outside experts for the
dialogues about relevant movements in Japan and overseas, about what is important to keep in mind about corporate activities,

Formulating Value Creating Story in CSR Message on
the Basis of Corporate Philosophy

Cleating Value from Solutions to Societal Issues
in View of SDGs

and about what stakeholders expect of the Chiyoda Group.

The business category called comprehensive engineering in Japanese is easierAn engineering company deals with more than just technology. Its businessto understand in its English term, which is integrated engineering. There are very

also covers a wide range, and putting this the other way around, we could say thathigh expectations of Chiyoda with respect to CSR because the company has ait seems a kind of enterprise that has great possibilities. Think of CSR not as thediversity of technologies and human resources to implement the Corporate

corporation's responsibility, but as the expectations placed on the corporation.

Philosophy of“harmony between energy and the environment”that forms the

Since the late 20th century, a consensus has formed that resolving social andcore of the SDGs. At the same time, therefore, the company bears a great

economic problems will require more than just a United Nations framework. It will

responsibility. As a speciﬁc example, its CSR Report says that a project in Papua

depend on the cooperation of the business sector with its abundance of

New Guinea hired 2,500 local people and gave them training. According toresources. The Global Compact came into being as a result. In 2015, the voices ofdevelopment economics, it is a tremendous feat to accomplish this without ODA

stakeholders from around the world formed at the United Nations in the SDGs,

or other cooperation, and I think this is a story that Chiyoda could disseminate

which form a common language. It appears to me that corporate social responsi-

more actively. The mindset of the individuals involved is very important in CSR

bility (CSR) and creating shared value (CSV), which originated in social contribution

implementation, so I think that if Chiyoda created an arrangement for collecting

activities, have gone back to their original place as a vision of what can be

the things local people on the ground are saying, and if the company focused theaccomplished by a company's core business. For the Chiyoda Corporation, thespotlight more on its employees when disclosing information, this would heighten

core business covers a broad range, so all seventeen goals of the SDGs are

the degree of penetration and the ability to communicate Chiyoda's CSR message.

relevant, but your technology cannot be put to good use or purpose unless you

Envision the kind of change your company's initiative

analyze societal issues and apply your own technolo-

could bring about a decade from now, formulate thegy and know-how in an outside-in manner (or fromstory accordingly, and throw yourself wholehearted-

an external viewpoint) to generate innovation. Since

ly into it so that what will emerge as the result of thatpeople have expectations of your company, I hope

eﬀort is your CSR. Create a means for arranging this,you will set concrete targets for renewable energy,

train the young people in it, and the company willhydrogen-related programs, and other environmen-

undergo change. If you set up the long-term objective

tal areas, and feature them prominently. In dealing

to match the same target year of 2030 as the SDGs,
and disseminate the story that way, then I think that a

Session Summary

Outside Participants

Chiyoda Group Participants■ DateMs. Mariko Kawaguchi
Chief Researcher, Research Division,
Daiwa Institute of Research Ltd.

［Moderator］
Ms. Kaoru Nakamura
GM, PLC Planning & Administration Unit Mr. Makoto Watanabe
Corporate Planning Unit
Mr. Yasuyuki Maeda

March 13, 2017

■ Location Chiyoda Global
Headquarters,
Chiyoda Corporation

Mr. Masao Seki
Senior Advisor on CSR, Sompo Japan Nipponkoa Insurance, Inc.
Mr. Kenichi Takayasu
Professor
Department of Economics, Dokkyo University
Mr. Katsuhiro Harada
Professor
Meiji Gakuin University

Taking a Global View of Added Value from a CSR
Perspective

more concrete corporate value will be conveyed to

Mr. Shuichi Wada
Senior Vice President & Division Director,
Corporate Planning & Management Division
GM, Corporate Planning Unit

Perusing Business Trends with Sincerity to Achieve
Aggressive CSR
My ﬁrst impression of the Chiyoda Corporation was of its extremely

open and diverse. Frankly, I was amazed at how ﬂat the organizational structure insophisticated technological capabilities, as an enormously powerful global

the industry is, and how free of oﬃcial, organizational constraints. It just seems acorporation that would rather transform society than contribute to society.

pity that the industry is so little known inside Japan because of a lack of domestic

In the area of CSR activities, the corporation is sincerely grappling with the

PR. An approach from the standpoint of Daiwa Securities considers that in the

demands of society, but my impression is that it tilts somewhat toward ainvestment world, conventional environmental and societal problems are

defensive stance. I wonder if it might not be worth appealing to stakehold-addressed by SRI, or Socially Responsible Investment, for which the motivation

ers with more aggressive CSR activity that tells the Chiyoda story. The SDGs

comes from the corporate social responsibility perspectives of ethics and ﬁnance.

were adopted in 2015, and then the Paris climate Agreement was signed

At present, however, we see rapid expansion of ESG investment, which places

toward the end of that same year, so that was a major turning-point. Withvalue on environmental and societal issues, as a measure for raising investment

the world now starting to steer toward the zero-carbon goal, this transition

performance. The world's major corporations are responding to the climate

risk represents a new business opportunity for Chiyoda. The mostchange issue by changing course toward 100% renewable energy sources andimportant thing is for top management to make a commitment. Statistics

carbon-free goals. In Japan, however, we are ﬁxated on low-carbon approaches

tell us that management in Europe has about 65% understanding of SDGs,

centered on energy conservation, and there is concern that we are falling behind.

while management in Japanese corporations is still at 25%. It will also be

As to SDGs, they should be positioned as long-term management strategies thatimportant to work on middle management, which is most directly

are promoted top-down as company-wide activities.

inﬂuenced by top management.

In doing so, the attention should always be directed

A baseline of business today is the respect forto the global, and it is important to take hidden

human rights, which also underpins the foundation

negative factors into consideration, so that you canof the SDGs. It is necessary for the corporation tofollow the impact on local operations as well as

establish policy regarding human rights anddetermine the contributions achieved. This is certain

disclose it. It must also identify the risks of human

to contribute to heightened employee motivation.

rights infringement in value chains, and activate

proposals for added value in your core business, theresult can have a powerful appeal that may also leadto solutions for customers.

11 CHIYODA GROUP Sustainability Report 2017

Mariko Kawaguchi
Chief Researcher,
Research Division
Daiwa Institute of Research Ltd.

Professor
Department of Economics
Dokkyo University

with the value chain, you should also cover humanrights and other related matters. It is important tobe aware that in resolving societal issues can yield

Katsuhiro Harada
Professor
Meiji Gakuin University

proﬁt, and to share that awareness.

Associate Director,
Corporate Risk Management Division
GM, Compliance Unit

The image of the Chiyoda Corporation and of this industry is that it is extremely

When CSR serves as an opening to come back withyour stakeholders.

Kenichi Takayasu

the PDCA cycle to implement preventive measures.

Making CSR Consciousness in Employees anda Driving Force for Moving Forward

Transforming Risks to Opportunities for Enhancing
Corporate Value

The idea here is that furthering CSR activities will generate a driving force

CSR is not a duty but an expectation, so where you have an ability orin the form of corporate value. In order to reach out to employees and give

response, you have a broad possibility for responding to stakeholder

them a solid sense for the relationship between

expectations. It is the same with risk manage-

the Chiyoda Group's core business and theirment. As I understand it, managing risk means

own individual work on the one hand, and thethe same thing as determining how to take

SDGs on the other hand, it will be essential notadvantage of an opportunity. I would like toonly to have members of top management

see us bring the corporate value of the Chiyoda

emphasize the point, but also to incorporate

Group into even clearer deﬁnition, have every

that understanding in company policy. It isindividual actively think about transformationand discovery, and then go on to develop the

possible, however, that this kind of approach
may make some employees feel they are being
forced. I think it would be good to get awayfrom the notion that there are some particular
individuals who are interested in CSR, andKaoru Nakamura

combination of these.

GM,
PLC Planning &Administration Unit

Yasuyuki Maeda
Associate Director,
Corporate Risk
Management Division
GM, Compliance Unit

instead spread that CSR consciousness widely
among your employees.

Thoughts on Hearing the Views of Experts
I want to say thank you for sharing your valuable views with us today. What I heard has allowed me to conﬁrm
not only the basics of CSR, but also the trends in society that form the context for CSR. Having received a variety ofdiﬀerent suggestions, what we will do is analyze and study them thoroughly as the Chiyoda Group. Then, we will
review our CSR vision, which has stood now for ten years since it was formulated, disseminate the understanding andfurther promote activities among all our employees. In order to press forward with activities and business that aresuited to the Chiyoda Group, in light of the spirit of the SDGs, I would like to actively create occasions of this kind.

Masao Seki

Shuichi Wada
Senior Vice President &Division Director,
Corporate Planning &Management Division
GM, Corporate Planning Unit

Senior Advisor on CSR
Sompo Japan Nipponkoa Insurance, Inc.

CHIYODA GROUP Sustainability Report 2017 12

Feature2

Development Project Initiatives on the Northernmost Energy Frontier

Yamal LNG Project

Initiatives for Safety

success. On April 28, The World Day for Safety and Health at Work,At present, approximately one thousand three hundred (1,300) JV

three (3) members were awarded for their active safety improvement

ronment,”and“contributing to the sustainable development of society as an integrated engineering company throughstaﬀ members and twelve thousand (12,000) workers under the joint

initiatives. Safety Day events are held every three months, and all theventure supervision are working on the construction site of Sabetta. In

members of the project teamdevelopment of society by transcending the frameworks of regions and corporations to provide high-quality plants for astable supply of energy. This feature article introduces the Yamal LNG Project as one such example of this approach.

addition, there are ten module yards set up in Asia under manage-

are engaged together in thement by the Paris oﬃce of the joint venture, which serves as a central

Safety First approach.

The philosophy of the Chiyoda Group is to“Enhance our business in aiming for 'harmony between energy and the envithe use of our collective wisdom and painstakingly developed technology.”In that spirit, we are contributing to thebase for execution of this internationally networked project.
Safety measures are being thoroughly implemented at all projectsites and oﬃces. These began with a workshop for manager level staﬀ
held in 2015, followed by seminars held at every operation center andProject Overview

We are engaged in the construction of Yamal LNG Plant project located in Yamalo-nenets Autonomous

every module yard, and extending even to subcontractors at theSabetta site oﬃce. Particularly, ten (10) Asian yards attained a great

Safety commendation

Region, Russia, as a member of the joint venture (JV) composed of TechnipFMC, JGC and Chiyoda. Chiyoda’s involvement in this project is based on the recognition for its achievement of the successful project
execution in Russia; Sakhalin 2 LNG Project.

The contract for this project was signed in 2014. This project is such a huge scale undertaking that theconstruction of a LNG plant with three lines producing 5.5 million tons annually is to be completed in ﬁve
years. The LNG it produces will be exported to China, Spain, France, and other countries.

The construction site is located at the severest natural environment in Russia at a latitude of 71 degrees

north. The winter season occupies eight months of the year. In the winter the sun never rises, and in thesummer, it never sets. Since operations are carried out in a harsh environment where the winter tempera-ture drops as far as -50°
C, a modular construction method is adopted. Construction modules, some ofwhich are tall as a 10-story building, were fabricated at various locations in the South East Asia andshipped on large ships to be completed on-site, thereby making this project tackle various challenges.

Further, this region serves as an energy frontier where 22% of reserves of the world natural gas areconcentrated, and this project will be the Russia's ﬁrst large-scale energy development project undertaken
in an untapped land under such harsh environment as located on the permanently frozen ground in the

Safety seminar participants

set up throughout China, Indonesia, and so on. At its peak, there are ﬁfteen thousand people working

Initiatives for Environmental Preservation

Arctic. The JV is based in Paris, from where it manages seven engineering centers and ten module yards
on-site to carry out the project.

Participation in Charitable Activities

A beach cleaning campaign

Eleven (11) female members of the Yamal LNG Paris team participat-

was held in areas around theed in the most famous women's marathon in Paris, La Parisienne, onplant construction site on

September 11, 2016. There were thirty-seven thousand (37,000)

September 24, 2016. A large

runners and the course was 6.7 km long. The entry fees were used tonumber of employees participat-

support medical research on breast cancer.

ed.

Scenes of beach cleaning

Initiatives for Human Resource Development
Fifteen (15) students from the Moscow State University of Civil
Engineering took the opportunity to come and work at Sabetta site
oﬃce from June 29 to August 19 of 2016. The students had ﬁrsthandMembers of the Yamal LNG Paris teamexperience of operations in a number of ﬁelds, including construction,
quality, HSE, transportation, pre-commissioning, and so on. This gavethe students a good opportunity to learn a great deal from the highly
experienced members of the joint venture team, as well as to getpractical approaches for their own future work, and they were verysatisﬁed. We intend to continue contributing to the development of theengineers of the future.

Voice of Employees
In this project, we are taking the challenge of LNG plant

construction in the Arctic, a harsher environment than everbefore. Overcoming this challenge enables us to promote
development of a gas ﬁeld with reserves in a territory too

cold to be considered readily accessible, and we think thiswill support the sustained, stable supply of LNG, which is anenvironmentally friendly energy

source. We are making the most of

the expertise and technology developed in our past project experiences, and all our employees are

joining together as one team in our

day-to-day eﬀort to bring this plant
to the successful completion.

Nobuhiko Koizumi
Project Manager
YL2 Team

Moscow State University students

13 CHIYODA GROUP Sustainability Report 2017

CHIYODA GROUP Sustainability Report 2017 14

Vision 1

Industry,
Innovation,and Infrastructure

A Reliable Company

BUILD RELATIONSHIPS OF TRUST WITH OUR CUTTING-EDGE FA CONTROL TECHNOLOGY

Equipment at Fujinomiya Plant
Chiyoda System Technologies Corporation (CST) won the order forconstruction of control systems at Fujinomiya Plant of Nippi Collagen

How

Why
provides the foundation for management. Throughour business, the Chiyoda Group will contribute to
the resolution of global issues and the sustainable
development of society so as to continue earning
the trust of our stakeholders.

・ Provide safe, reliable plants
・ Execute high quality engineering
・ Provide full support for plants during emergencies

Industries, Ltd.
In May 2016, the construction of new casing manufacturing plant
was successfully completed.
In addition to build the relationships of trust between the client, all
the members were united to accomplish the project. As a result, weachieved an accident-free, disaster-free completion. Furthermore, in
response to the client’s request of making it possible to operate and・ Provide solutions to global issues through businessmonitor the adjustment process in the No.2 Plant, newly constructed at

・ Provide engineering solutions for the sustainable

this time, to the existing No.1 Plant, we built an FA network andsuggested installing programmable logic controllers (PLCs)*₁ and touchdevelopment of society

panels. We also made a number of suggestions, such as an integrationof control panels, the adoption of a network with reduced wiring
requirements at lower costs, and a calibration eﬃciency improvementof the load cells*₂ on the tanks, as a result of which we built a relationship of unshakeable trust with the customer.

Plant of the Nippon Synthetic Chemical Industry Co., Ltd

items), testing air tightness and making repairs of piping (one hundred
twenty packs), and so on. A consistent end-to-end project system wasused from surveying and inspection to analysis, planning, and construc-intensity of 7 was observed. In the city of Uto, where the Kumamototion. A response team consisting of the members both from a customer

Plant of The Nippon Synthetic Chemical Industry Co., Ltd., is located, theand from the Chiyoda Group was formed. Further, thanks to the coopera-

tremors reached a peak intensity of upper six on the Japanese scale.

tion of on-site suppliers the restoration of the main lines was completed

Damage to tanks, buildings, production equipment, piping facilities, andover a brief period of approximately two and a half months. Thus,

so on caused manufacturing facilities to stop operating. The Chiyoda

responding to the requirements of the customer suﬀering from theGroup was asked to quickly restore operation of three lines thatearthquake, we fulﬁlled our responsibility as an engineering company.

ADDED VALUE ENHANCED BY PROPOSALS USINGINTEGRATED 3D DESIGN TECHNOLOGY

tion in March 2016.

overall capabilities, including the ChAS & Life Science Project Operations

We implemented this project by applying our integrated 3D design(facility diagnostics), CKS (construction management), and CST (electrical

technology to construction drawings created by a subcontractor during
the construction stage. The manufacturing areas in a pharmaceuticalplant are clean rooms. Since these involve air conditioning equipment

aftershocks were still continuing.

for managing room pressure, temperature, and humidity, as well as a

The work started with emergency

great deal of piping for manufacturing water as well as ducts and piping

safety checks and risk determination

involved in production, there have commonly been issues in coordinat-of structure collapse using 3D laser

ing the use of ceiling space. What we did, therefore, was to integrate

instruments, after which we implement-

the 2D drawings with 3D drawings created before starting construction.

ed repairs on building columns, walls,

This allowed us to visualize the ﬁt of the various equipment andand framework (ﬁfty locations), inspection

facilities. Then we held coordination meetings where the customer,

and repair of rotating equipment, towers,

CTA, and cooperating contractors could conﬁrm issues and makeand vessels (one hundred sixty items),

corrections to the design.

Scene of reconstruction work

In this way we were able to closely approach an optimal facility
building plan from construction to operation. The 3D drawings that had

Voice of Employees

viewable and shareable in real time by workers and so on. This also

Real Feeling of Single team Project Execution with the Customer

facilities and equipment in visual form. Furthermore, since work on

made it much easier to represent the operability and maintainability of
construction was begun after issues had been resolved, redundant

The situation had been unexpected on the customer side, as well, so when the disaster ﬁrst hap-work by cooperating contractors was eliminated, and not only was

pened, they did not even have together all of the drawings necessary for us to take measures. We were

better communication achieved with the customer and cooperating

being pressed to take measures in a situation that did not even give a clear picture of how work should

contractors than before, but the amount of work needing to be redone

proceed. The Chiyoda Group and the customer formed a single team combining maintenance and opera-

was reduced, construction time was shortened, and so on. These

tions personnel. In the course of going forward with day-to-day on-site work and formulating restoration
proposals, a sense of unity gradually formed with the aim of rapid restoration of operations, and we built

results made it possible to increase the added value to a greater extent

strong relationships of trust with customer.

than previous construction methods.

15 CHIYODA GROUP Sustainability Report 2017

date. The Chiyoda Group members, however, think as our company’spoint of view, and were courteous and ﬂexible in their responses. We arealso grateful for the sincerity they showed us in their follow-up.
Mr. Yoshihito Okubo

Deputy Manager, Fujinomiya Plant
Nippi Collagen Industries, Ltd.

*1: Control devices developed as an alternative torelay circuits*2: Load transducers that convert load (force) into
electric signal
Good Healthand Well-Being

Industry,
Innovation,and Infrastructure

Nippi Collagen Industries, Ltd.
Fujinomiya Plant

Actual image

Combined 3D drawing

Comments from the Client
We are Grateful for CTA's Outstanding Project Execution andTechnology

The use of integrated 3D drawings struck us as an excellent techniquefor formulating plans that provide an image of the completed work evenduring construction of a plant, in the same way as the technique generally
employed in the pharmaceuticals manufacturing sector, of drafting amaster plan in advance and then executing design qualiﬁcation (DQ). The
design created in advance can be conﬁrmed in 3D so that adjustments
can be made for problems prior to construction, and as a result, costs canbe reduced. Chiyoda TechnoAce's idea for this approach was excellent,and it solidly addressed the need not only for quality control and safety
management by each cooperating contractor, but also for progress
management. This approach also realized in thoroughgoing managementof each separate element of construction, such as building construction,equipment installation work, and so on.
This project allowed us glimpses of
Chiyoda TechnoAce's superb technology, and we are extremely satisﬁed withwhat we have seen.

Yuji Saito
Downstream &Chemical Project Control Section

Mr. Takahiro Yamaguchi
Director & General Manager, Production Headquarters
Seiko Eiyo Yakuhin Co., Ltd.

CHIYODA GROUP Sustainability Report 2017 16

Commitment to Fairness

been examined were used as a construction standard by making themcustomer side. I think that this contributed to their decision making and the prompt resolution of problems.

This project was no exception. They faced severe conditions, including
updating speciﬁcations due to changes in the plans and tight delivery

Respect for Human Rights

and instrumentation), and we began
restoration work in early May whilelems presented by experts from the Chiyoda Group to be communicated directly to management on thethem into practice.

Chiyoda TechnoAce Co., Ltd. (CTA) won the order to build a newcontract manufacturing organization (CMO). We completed construc-we had already built relationships of trust that made it possible for the many proposals to resolve prob-

What impresses us each time is the high qualities of their technicalsupport and ideas, and the abundance of human resources who put

plant for Seiko Eiyo Yakuhin Co., Ltd., which is a pharmaceuticalmain products, Teams were formed to mobilize the Chiyoda GroupI think that this relationships contributed to the smooth progress of our following project work. Since

centered mainly on new plant constructions.

New Plant Construction Project for the Seiko Eiyo Yakuhin Co., Ltd.

manufacture polyvinyl alcohol and optical ﬁlm, which are the company's

inspection of instrumentation (a thousanda variety of developmental projects. The projects have beenindustrial plants so that they can produce the best products.

When the Kumamoto earthquake struck in April 2016, a peak seismic

Measuring inclination using
3D laser

Our company's relationship with the Chiyoda Group goes back to
20 years or more. During that time, we have successfully carried out

We will continue providing our customers with safe, high-quality

Responsible
Consumption
and Production

THE ENGINEERING COMPANY'S MISSION IN SOCIETY
Construction for Early Restoration of Operations at the Kumamoto

We use collagen extracted from cowskin as the main ingredientto manufacture edible sausage casings.

Social Contributions through Business Activities

Sustainable
Cities andCommunities

We Give CST High Marks for Quality of Engineering and
Implementation Capabilities

Environmental Initiatives

For a corporation, the trust of its stakeholders

Comments from the Client

A Reliable Company

Nippi Collagen Industries, Ltd.
Completion of Construction on Control Systems for Casing ManufacturingVision 2

How

Ever since it was founded, the Chiyoda Group has been

・ Development and demonstration of clean energy

addressing the conﬂicting topics of energy and the environ-・ Engineering contributions leading to a carbon-free

ment. The Paris Climate Agreement and the SDGs adopted

societyby the United Nations in 2015 communicated a common
message to the world regarding initiatives for environmen-

・ Dissemination of environmental technology

tal conservation and clean energy, and concern with the・ Environmental initiatives implemented throughenvironment among stakeholders has been growing

project execution

greater.

Because the ceramic membrane ﬁlter requires no pretreatment such

improve the produced-water ﬁltering technology that supplies oil moreas that for coagulation, the use of chemicals can be greatly reduced.

economically, increases oil ﬁeld longevity and decreases the environ-Further, as the membrane can be washed and used repeatedly, no

mental burden.

disposable waste will be generated, reducing the environmental*Produced-water: Formation water produced alongside crude oil and natural gas

TECHNOLOGYDEVELOPMENT OF
HYDROGEN ENERGY

THE DISSEMINATION OFTECHNOLOGY TO
PREVENT AIR POLLUTION

Aﬀordable andClean Energy

Sustainable
Cities andCommunities

ClimateActionSustainable
Cities andCommunities

ClimateActionSPERA Hydrogen® system receives the top prize of the Nikkei Global

CT-121 licensing of technology to one of India’s major heavy industry
manufacturers

Hydrogen is considered a clean next-generation energy, and the

In November 2016, Chiyoda concluded a technology license

dissemination of hydrogen fuel cell vehicles and ENE-FARM (home-use

agreement with India’s major heavy industry manufacturer Larsen &fuel cells) as well as practical realization of hydrogen electricity genera-

Toubro (L&T) to provide its proprietary“Chiyoda Thoroughbred 121

tion are being promoted by the government. In this respect, it is(the CT-121)”ﬂue gas desulfurization process (FGD) technology for

essential to develop a technology for hydrogen to be“stored”andpromotion in the Indian market.

and oil. Such technology has never been available until now.

Coal accounts for 75% of the power supply in India, which, with its
robust and rapid economic growth, is in need of power plants to sustain

In 2014, we became the ﬁrst in the world to complete technologicaldevelopment. The demand for FGD plants is increasing signiﬁcantly, as

development to resolve this issue. This system has been named

the demand for coal is ﬁrmly rooted in its cheap and stable price. While“SPERA,”meaning“hope”in Latin. There are high expectations for thiscoal-ﬁ red thermal power provides 42% of the world’s energy, thattechnology, which has been

ﬁgure is expected to reach 44.5% by 2030.

highly evaluated both domesti-

Under these conditions, CT-121, the environmental technology

cally and internationally, and has

highly evaluated by L&T, will continue to meet the demands of India’sreceived numerous technology

economic growth while helping to resolve its environmental issues.

awards such as the top prize inAﬀordable andClean Energy

the Nikkei Global Environmental

ClimateActionNEXT-GENERATION CLEAN ENERGY
A demonstration plant for renewable jet and diesel fuels
As a business partner in the“Domestic Biofuel Project,”led byeuglena Co. Ltd. (Euglena), we are currently participating in theTechnology Awards. We willcontinue to meet these highconstruction of oil reﬁ neries, we continue to collaborate in the commercialization of this technology and further contribute to reducing
CO2 emissions.

construction of Japan’s ﬁrst renewable jet and diesel fuel demonstra-

expectations and to contributeto the global environment.
Grand Prize plaque for
Nikkei Global Environmental Technology Awards

tion plant (to be completed in October 2018).

ClimateActionChiyoda approaches the design, procurement and construction

the United States, Chevron Lummus Global, Euglena is executing theing on the plans provided by our clients and proactively engaging in

dards.

environmental proposals, we aim to construct plants with a lower

Led by METI (the Ministry of Economy, Trade and Industry) andenvironmental impact.

MLIT (the Ministry of Land, Infrastructure, Transport and Tourism), theOver the past ﬁve years we have submitted an average of 319

project aims to switch to biofuel by 2020 to reduce the extent of CO2

proposals annually. In 2016, 221 proposals were accepted by ouremissions. The international framework of the ICAO (International Civil

clients. Our project procurement operations are implemented on our

Aviation Organization) to prevent CO2 emissions from exceeding thegreen procurement guidelines based on the Ministry of the Environ-2020 standard means that the need for jet biofuel is becoming great-ment’s Green Purchasing Law so that we utilize construction materials

er than ever.

and construction methods with less of an environmental impact.

Respect for Human Rights

stages of every project with consideration for the environment. Improv-

design, procurement and construction according to Japanese stan-

Latest appearance image of the pilot plant
ClimateAction

EFFECTIVE UTILIZATION OF OIL FIELDS

Pilot plant demonstrates SPERA hydrogen system

Major Examples of Technology Demonstration Operation❶ Synthesis gas generation process: CO2/steam reforming process❷ Catalyst for Hydrodesulfurization: Hybrid titania catalyst❸ A high-severity ﬂuid catalytic cracking (HS-FCC) process❹ Various types of waste water treatment technology❺ Acetic acid production process: CT-ACETICATM❻ Concentrated solar power generation

Yabase oil ﬁeld produced-water treatment demonstration plant
Global energy needs are growing, for one reason, because waterproduction from oil ﬁelds increases as oil ﬁelds age. To maintain highlevels of productivity in oil and gas production while concurrently
abiding by environmental regulations, more advanced produced-water*
treatment technology is needed.
To resolve the problem of produced-water treatment, the Japan Oil,

ENVIRONMENT-ORIENTEDPROPOSALS IN 2016
SPERA水素デモプラント❶ Site preparation plans that minimize surplus soil generated
after construction❷ Adoption of energy-conserving, low-noise equipment❸ Pier design optimization plans to reduce jungle deforestation
GREEN PROCUREMENT

Gas and Metals National Corporation’s project known as“Small-Scale
Demonstration of Produced-Water Treatment Technology” is being
jointly conducted by four companies: the Japan Oil, Gas and Metals
National Corporation, INPEX, METAWATER and Chiyoda.
Yabase oil ﬁeld produced-water treatment demonstration plant❶ Use of portland blast furnace cement (material designated under
the Green Purchasing Law)
❷ Use of base coat paint (anticorrosive) (material designated under
the Green Purchasing Law)
❸ Use of EM electric wires and cables (eco-friendly material)

CHIYODA GROUP Sustainability Report 2017 18

Commitment to Fairness

Responsible
Consumption
and Production

17 CHIYODA GROUP Sustainability Report 2017

Sustainable
Cities andCommunities

Environmental Proposals/Green Procurement

Using technology that was introduced by our technology owner inWith know-how accumulated through engineering and the

ENVIRONMENT-CONSCIOUS
ACTIVITIES IN PROJECTEXECUTION

Social Contributions through Business Activities“Serving Society with Technology”is the philosophy of Chiyoda’s foundation. Bearing this in mind, we have undertaken research anddevelopment, demonstration projects and commercialization of energy and advanced environment-related technologies.
Making the most of our strengths as an engineering ﬁrm, we are able to take such a comprehensive approach to research and development
as it is integrated with process development, design and system analysis. With this approach, we have carried out technology development
both on our own and in cooperation with our clients and technology owners, aiming for commercialization and problem-solving based onsociety’s ever-changing demands. We will continue our eﬀorts to contribute to solving new issues including materializing a low-carbon andcarbon-free society.

Aﬀordable andClean Energy

Environmental Technology Awards“transported”in a stable state and in large quantities like natural gas

TECHNOLOGY

water for reservoir pressure maintenance in oil ﬁelds.
We will continue this domestic demonstration project, aiming to2017 and planned for seven months.

Environmental Initiatives

Whyburden. It is expected that the ﬁltered water will be reused as injection

A Reliable Company

Environmental Initiatives

For the project, a demonstration plant was constructed at the
Yabase oil ﬁeld in Akita Prefecture, with operations begun in MarchVision 3

The social responsibility of engineering ﬁ rms is to address

・ Adding value by integrating cutting-edge technologies

providing superlative services and products in partnershipwith our clients, using skills and expertise accumulated

achieve safe plant design. The participants review relevant case studies,safety practices domestically. By promoting such a culture of safety

study the work ﬂow and relationships between the various required

awareness, Chiyoda will continue to provide safe and highly reliablesafety studies, look at how interdisciplinary safety matters areplants to our clients. This will enable all our employees to be proud of

addressed and learn the eﬀects on costs and schedules when safety

the achievements we deliver.

• Forming and promoting a culture of safety• Human resource development and technology
transfer in countries where we have projects

from experience in engineering and constructing plants

DEVELOPING EXCELLENT HUMAN RESOURCES THROUGHTECHNOLOGY TRANSFER
Deployment of international client training
In addition to carrying out many international projects, theChiyoda Group also concentrates on developing human resources inthose countries.

and consistently oﬀering services with the full use of
cutting-edge technologies.

ReducedInequalities

Partnerships
for the Goals

The number of participants in these programs last year was 73. The
training

provided

in

Japan

also

includestheopportunity

toexperience Japanese culture.
Thus, through engineering training and cultural exchange, we collabo-

Starting with the acceptance of trainees from the Kingdom of Saudi

rate with countries where

Arabia in 1976, followed by training including on-site technicalplants are constructed toeducation in the Federal Republic of Nigeria in 1978, collaborative

help create a basis fortraining with external organizations has been in practice since 1982.

the innovation of their

The training oﬀered to foreign clients is highly esteemed both domes-

industries and technolo-

tically and overseas. The United Arab Emirates joined in 2010, andgies as well as develop

the State of Qatar joined in 2012, while the number of countries

their human resources.

participating in training continues to grow, including the Kingdom of
Saudi Arabia, the Republic of Korea, the Republic of Mozambique andInitiatives in the AI Solutions Field

neural network* development. In the course of such activities, we have

The Chiyoda Group estab-engaged continuously in measures to apply the most up-to-date tech-

October 2016 with the aim ofMore recently we have worked on demonstrating the validity of big

maximizing the value of custom-

data analytics by conducting correlation analyses of operating data on

er plant assets by using big

the deterioration of equipment due to aging in ﬂue gas desulfurization

data analytics technology andunits in power plants. This is conﬁrming the possibility of causal analy-

artiﬁcial intelligence (AI) to

sis and a formulation of eﬀective measures.

provide support for the opera-

The Chiyoda Group has responded to troubles and resolved oper-

tion and maintenance of all

ating issues through the eﬀective use of cutting-edge analytics, diag-types of industrial plant. Thisnostics, simulation, and other such technologies. By utilizing the AI

unit concluded a businesstechnology, we will develop these activities into a new businessalliance agreement with GRID

providing operational support services, and will contribute to theInc. in December of that year, making it possible to fuse advanced

sustainable development of society.

plant engineering with GRID’s state-of-the-art AI technology. An opera-

A Scene of Trainingof reliability through the use of AI systems has already begun, andfull-scale business expansion will be pursued in the time ahead.
The Chiyoda Group has a long history of initiatives in AI systems.
We started with expert systems in the 1980s and engaged in in-house* Information systems that are modeled after the arrangement of neuralcircuits in the human brain

Responsible
Consumption
and Production

DEVELOPING HUMAN RESOURCES WITH THE GOAL OF ESTABLISHING
INDUSTRIAL INFRASTRUCTURE

Quality
Education

Opening up internships for the Masdar Institute of Science andDiverse human resource development at Chiyoda Almana inTechnology (MIST)

accordance with the Qatar National Vision 2030

Through subsidiary aid granted by the Agency for Natural Resources

Our overseas Group companies contribute to developing various

and Energy in the Ministry of Economy, Trade and Industry, internships

human resources. Chiyoda Almana Engineering LLC supports thehave been provided to the United Arab Emirates’Masdar Institute ofdevelopment of human resources, an important aspect of the Qatar

Science and Technology (MIST), with the Japan International Coopera-

National Vision 2030. Chiyoda Almana supports Qatar by nurturing

tion Center (JICE) as the point of contact. The project was founded

diverse human resources and career development.

with the goal of promoting fellowship and strengthening cooperation

In 2016, the company sponsored many educational opportunities in

between Japan and the United Arab Emirates. Within the ﬁelds ofthe ﬁeld of hydrocarbon processing technology. With the goal ofrenewable energy, smart communities and green technology, Japaneseenriching the technical experience of those in the ﬁeld, Chiyoda Almana

companies annually accept MIST students of UAE nationality, withand Chiyoda Global Headquarters facilitated training programs geared

2016 marking the ﬁ fth year so far. After arriving in Japan, MIST interns

toward RasGas and Qatargas engineers.

receive a basic introduction to life in Japan. Training is provided for

On November 2 and 3, 2016, we presented an important overview

each enterprise. Over ﬁve consecutive years, the Chiyoda Group hasof the basic operation of LNG plants to young engineers of Qatargas.

hosted a total of eight graduate students in internships involving

We are also proactively involved with developing human resources inclassroom lectures and on-site inspections for a month and a half. The

regional communities.

Respect for Human Rights

tion to conﬁrm the optimization of plant operations and enhancement

SAFETY FIRST

can be conducted both in Japan and by dispatching lecturers abroad.

nology to industrial plant operation.

lished the AI Solution Unit in

Sustainable
Cities andCommunities

the Islamic Republic of Iran. The training provided to foreign clients

Social Contributions through Business Activities

PROVIDING OPTIMIZED OPERATION THROUGH CUTTING-EDGE TECHNOLOGY

Industry,
Innovation,and Infrastructure

Decent Workand Economic
GrowthEnvironmental Initiatives

How

issues. In this respect, we are assigned the mission ofthe“Design Safety”course, we plan to apply the best international

studies/activities aﬀect the design of a plant.

Whyissues surrounding society and provide solutions for those

Chiyoda applies the“Safety First”concept to all our clients. ThroughBy the end of the course, we plan to have taught participants how to

A Reliable Company

Social Contributions
through Business Activities

course, which begins with consideration of the concept of plant safety.

Japanese government also works in close cooperation, fosteringengineering skills and human resource development.

Best international safety practices to beneﬁt project execution

Commitment to Fairness

The Chiyoda Group conducts all activities with“Safety First”as acore value. Furthermore, for our clients, a safe plant is usually theirhighest priority. While some industries apply“destructive testing”of
their products (think of crash tests for cars), this approach would be
obviously unacceptable in the design of hydrocarbon plants. We verify
the safety of our plant design by incorporating international, industry
and client-based safety standards. However, safety standards vary foreach country and are continually being updated. In addition, eachplant’s conﬁ guration and speciﬁ cations are unique. Therefore, aQatargas professionals at Chiyoda Almana Brownﬁeld Management
Masterclass 2016

complete understanding of the relevant codes and standards and theskills to undertake thorough safety studies are required when we
design a plant.
To deal with the various safety requirements, our company oﬀers a“Design Safety Induction Course”that targets all engineers involved inproject execution. To date, over 400 engineers have participated in the

19 CHIYODA GROUP Sustainability Report 2017

Scene of course instruction taking place

University students of United Arab Emirates' Masdar Institute of Science andTechnology (MIST)CHIYODA GROUP Sustainability Report 2017 20

Vision 4
SAFETY FIRST CRISIS MANAGEMENT SUPPORT TO PREPARE FOR ALL EMERGENCIES
A Reliable Company

Respect for Human Rights

Sustainable
Cities andCommunities

Business Continuity Plan/Disaster prevention
In 2015, the Chiyoda Group formulated a Business Continuity Plan
(BCP). Covering all kinds of disasters, including ﬁ res and large

How

Why
Human resources are valuable assets for an engineering

・ Initiatives to work style reformcompany. We will continue to create a corporate climate

・ Reinforcement of emergency management systems

that not only all of our employees, of course, but also theirof global human resources

developing operations on a global scale, we are facedwith a growing necessity to observe work style reforms

ed with the basic principle of“life comes ﬁrst.”
In 2016, we practiced ﬁ re drills from buildings and dealing with
disrupted transportation networks to help people return home safely inthe event of a large earthquake. While Chiyoda Global Headquarters
continued its BCP training from last year, training has expanded on a

Environmental Initiatives

・ Reinforcement of corporate strengths by development

families can take pride in. At the Chiyoda Group, which isearthquakes, disaster prevention practice and BCP training are conduct-

larger scale to the Koyasu Oﬃce & Research Park and the corporate
Group this year. In addition, the“Nighttime/Holiday Initial Response
Training”outlines the procedures necessary for the smooth resumption

promoted by the national government, develop global

and execution of business after a major crisis. In addition to verifying

human resource development and respect diversity.

the safety of employees, we also strive to ensure the safety of theirfamilies. In the event of a disaster, employees’family members will
receive e-mails to conﬁrm their safety if they are registered on the
Gender Equality

INITIATIVES FOR CHANGES IN WORK STYLE IN FY2016

Decent Workand Economic
GrowthFurther, our Group company Arrowhead International makes all thearrangements for our employees’business trips. Providing adequate

In FY2016, Chiyoda Corporation received“Kurumin,”a certiﬁcation

ees’mindsets and organizational operations as well as improvements infor companies recognized for their enthusiastic eﬀorts to cultivate thethe operating bases where Chiyoda is 1) a company whose employees

next generation, granted by the Kanagawa Labor Bureau of the Ministry

are motivated to continue working on a long-term basis and 2) aof Health, Labour and Welfare. Companies can gain this certiﬁcation bycompany that is continually able to develop its competitiveness andachieving the goals speciﬁed in their action plans and by satisfying thestrength.

criteria set by the bureau.

We have developed systems for reduced working hours and for

Chiyoda Corporation obtained the certiﬁcation after achieving theleaves of absence for employees constrained by child care or nursing

targets set for the period from April 1, 2010 to March 31, 2015 and forcare. Among our achievements in FY2016, we embraced diversity,

being highly appreciated for the following new initiatives to take frommade the child care and nursing care systems more ﬂexible andnow:❶ Leaves of absence for employees working in Japan or overseas
to be oﬀ with their spouses

between departure and return, the Arrowhead Travel Risk Management
System (A-TRIMS) provides safer and more reliable crisis management.
This system veriﬁes the itineraries of those traveling overseas andensures their safety by thoroughly checking through e-mail and mobile
phone. The Group as a whole supports stronger crisis management andputs the safety of employees ﬁrst.

❶ Extending application of a program of shorter working hours
to employees with elementary school children up throughthe sixth academic year, fostering a better balance between
work and child care
❷ Consideration of ﬂexible work styles❸ Reduction of total working hours by enforcing stoppage ofwork after 20:00 and on holidays

Saudi Arabia
At the construction site of a sponge titanium plant that was

As part of this activity, we conducted evacuation drills several times
to ensure prompt evacuation and conﬁrm the eﬀectiveness of theEmergency Plan and Emergency Response System.

mechanically completed in May 2017 with Non LTI for Advanced

Practical training was carried out while the diﬃculty level was

Metal Industries Cluster and Toho Titanium Metal Company Limited,

continuously raised according to the progress of construction and thewe worked with the client to implement various crisis management

number of ﬁeld oﬃce staﬀ.

measures in terms of both hardware and software to ensure the safetyof the client and ﬁeld oﬃce staﬀ from around the world.

Respect for Human Rights❷ Re-employment opportunities for people who have left thecompany for child care, nursing care or to accompany
spouses who have been transferred❸Work-at-home (teleworking) opportunities on a trial basis(Note: Full-scale introduction was launched in May 2017.)

support that puts safety ﬁrst for the various risks that may occur

Crisis management activity at the ﬁeld oﬃce in Yanbu, Kingdom of

introduced a system to aﬀord retired employees new re-employment

BCP Training

We will continue our eﬀorts to create an environment where
employees can perform to the best of their potential.

These steps were taken to secure human resources willing and able
to work and to help retired employees be re-employed when theircircumstances change, all enabling us to increase our workforce in aneﬀective manner. We will continue to take steps to increase our
productivity and competitiveness by promoting such changes in work
style.

Commitment to Fairnessof Employees
Voice 声Thanks to the Eﬀorts of Many People, We Can Now Make Use of
absence program for taking along spouse
I was working as an engineer in the Gas & LNG Process Engineering Unit when my spouse was assigned
to Australia. Starting in October 2016, I used the system for leave to accompany my spouse and am now

The completed sponge titanium manufacturing plant

An evacuation drill in progress

living in Darwin, Australia. Under the corporate eﬀorts to promote work style reform, I felt somehesitation to choose this program, and I think that people who make use of this program will be a verysmall part of the total number of employees. However, now I am appreciating the company listening to
the minority voices of their employees, and gave me the choice of an alternative to continue working
from the long term viewpoint.
Chie Tanaka

21 CHIYODA GROUP Sustainability Report 2017

Social Contributions through Business Activities

We have been encouraging reform through changes in our employ-

opportunities. Additional steps include:

relevant system.

Human Relations Unit

CHIYODA GROUP Sustainability Report 2017 22

Vision 5
REINFORCEMENT OF CORPORATE STRENGTHS BY DEVELOPMENT OF
GLOBAL HUMAN RESOURCES

Quality
Education

Global Engineer System

A Reliable Company

Commitment to Fairness

Decent Workand Economic
GrowthWe instituted the Global Engineer system in April 2016 as ameasure to develop engineers who are able to perform globally at

How

Why

a higher level at the Chiyoda Philippines Corporation (CPh) andother Group companies. We aim to use this system to raise thelevel of the Group as a whole as well as to realize true globalization

Commitment to fairness is the foundation for the corpora-by assigning these engineers ﬂexibly to CGH (Chiyoda Global

・ Corporate operations with transparency

tion's continuing existence. The Chiyoda Group has

Headquarters) and Group company jobs.

and soundness in line with Corporate Governance Policy

pursued stronger governance and a more thoroughgoing

fairness from the Financial Services Agency, the United

・ Implementation of thoroughgoing compliance education

and Reporting System

demands for greater management transparency andNations Global Compact, and other such internal andand export control education

external demands.

Developing Staﬀ for Commissioning Operations

Developing Staﬀ for Risk Management
Corporate Risk Management Division has begun deploying safety,

India, Europe, America, and other places outside Japan. They

quality, environment, information security, compliance, and crisis

receive technical training at CGH in matters ranging frommanagement measures globally, providing its services to the entire

safety, the environment, security, and planning of plant test

Chiyoda Group. The First Summit of the Risk Management Division

operations, to implementation of said test operations. Then

(RMD), held in July 2016, also marked the start of an RMD program

they are dispatched to construction projects as on-site staﬀ

to share its personnel concerned with the risk management within

specialized in preparation for test operation. These engineers

the Group. As an initial part of this eﬀort, a global operation platform

contribute to project execution as well as to business and(GOP) task was started up at

growth in other countries.

the Group headquarters.

The Chiyoda Group has adopted a Compliance Consultation andbe used not only by Group employees but also by their families,
retirees, and employees of our business partners. An outside contact

CPh were dispatched to CGH for

point has also been set up. Reported matters are treated appropriately

a period of four months each.

according to the provisions of relevant legal statutes and regulations.

After that, information security

The Whistleblowing System is arranged so that people seeking

dispatched

LLC.

Reporting System

unethical behavior within the Group. The Whistleblowing System cantion security coordinators fromfrom Chiyoda Almana Engineering

Measures to make the active use of the Compliance Consultation andprevention, early detection, and correction of misconduct andDuring FY2016, quality manage-

were

INITIATIVES TO PREVENT MISCONDUCTReporting System (Whistleblowing System) for the purpose ofment coordinators and informa-

coordinators

Peace, Justice,and Strong
Institutions

ReducedInequalities

Chiyoda-Almana
Mochamad Riza Achrullar

consultation or making reports can have a sense of security.

Overseas Group company members who attended the discussions

To promote use of the Whistleblowing System in the Group
companies inside and outside Japan, in FY2016. Thoroughgoing steps
were taken to reconﬁrm the importance and necessity of the

FY2016 Whistleblowing Record(CGH and Group Companies in Japan)

Whistleblowing System for Group companies. Examples of measurestaken to activate the Whistleblowing System were also compiled andChiyoda & Public Works Co., Ltd. (CPW) is preparing for acquiring

Back in CPW, she will be a staﬀ member with a key responsibility

ISO 9001 (QMS) certiﬁcation, and CGH is providing full backup forfor tasks relating to QMS certiﬁcation acquisition. CPW aims is tothis eﬀort. We therefore hosted a representative from CPW for two

eventually obtain management systems certiﬁcation in safety,

months of training not only to support CPW in acquiring QMS

environment, and information security as well.

certiﬁcation but also to develop human resources for QMS mainte-shared within the Group to foster better understanding. Group
companies overseas sent their members to gather at CGH in July fordiscussion of the Whistleblowing System and compliance education.
From now on as well, the Chiyoda Group as a whole will make theactive use of the Whistleblowing System in order to enhance thecontrol on misconduct, enable the earlier discovery when it occurs,nance and management after receiving the certiﬁcation.

and make the correction promptly by responding to it.

Voice of Employees

cation process for CPW.

1

Sexualharassment

Total

24

cases

cases

cases

6

Labor,
work rules,
morals

cases

13
0

Af ter this training, I will be fully responsible for※

HQSE activities in CPW and expect these all things
learnt are reflected to work process in CPW definitely.

OHSMS, EMS and ISMS in CGH. Although the organi-to visit CGH for training.

zation size is big deference between CGH and CPW, I

Thank you so much for all

believe I will be able to apply my new knowledge &supports to CPW and me

experiences acquired here.

during my stay in Japan.

Category

Hierarchical training

Compliance

Even though my training is two months on-desk

Functional training
Seminars

Chiyoda & Public Works Co., Ltd.

In Export Control

Training for new hires
Training for mid-career hires

6

9

12

15

Content (Numbers of Times, People, Etc.)
Held 1 time

Seminar with outside instructor (Harassment: for general employees)
e-Learning

Issuance of briefs

Compliance briefs
Training for new hires

Functional training

Item

Training for new managerial personnel
Training prior to overseas assignment (for all assignees)
Training prior to on-site supervisory assignment (for all assignees)
Seminar with outside instructor (Harassment: for managerial staff)

e-Learning

Hierarchical training
Theint, Thiri Hlaing

3

cases

Compliance Education and Export Control Education PerformanceSo, please let me express my sincerest gratitude forgiving me the opportunity

to work actual activities without this training.

4

Power
harassment

Other
consultation

I have learnt a lot about not only QMS but also

training, not on-job training, it is sure I will not be able

cases

Training for mid-career hires
Export control: General training

108

Held 2 times

5

Held 2 times

53

Held as needed

250

Held as needed

37

Held 1 time

288

Held 1 time429

Japanese language

2,724

English language

117

Issued 2 times
Held 1 time

Special Training Course: Determination of the classification forgoods & technologies

108

Held 2 times

5

Held 5 times

128

Held 4 times

108※ Health,Quality,Safety,Environment

23 CHIYODA GROUP Sustainability Report 2017

CHIYODA GROUP Sustainability Report 2017 24

Commitment to Fairness

is great assistance to conduct ISO 9001:2015 Certifi-0

Legal violations& corruption

Respect for Human Rights

Developing Staﬀ for Quality Management

tice & study in SQEI Management Unit of CGH, whichSocial Contributions through Business Activities

The Commissioning Unit employs staﬀ from the Philippines,

My assignment is to acquire necessary work prac-

Environmental Initiatives

compliance. Beyond that, there have been growing

・ Global development of Compliance Consultation

The Chiyoda Group's Social
Contribution Activities

Assistance to areas hit by disasters■ Remittance of donations for earthquakes in Italy,
Ecuador, and Kumamoto(Implemented at Chiyoda Group in
Japan and at CPh)

Why

How

The Chiyoda Group is actively seeking solutions to

Taking“CSR promotion by all members together”asglobal issues in order to help create a better■ Providing food to the victims of large-scaledisasters (implemented at CPh)a motto, we are engaging continuously in social

society. This is not just a matter of Social

contribution activities of all types, both inside andContributions. We will also continue working

outside Japan, with the aim of collaboration andclosely with local communities to contribute to the■ Employee volunteer dispatching
to areas hit by disasters(Implemented at Chiyoda Group in Japan)

harmonious coexistence with local communities.

sustainable development of society.

500■ Sale of products from areas hit by disasters(Held at CGH and Koyasu Oﬃce)

10peoplegatherings

Educational Support & Human Resource Development■ Internships

7

2

Operating in

Held atcompanies

38

Environmental Conservation■ University lecturers■ Student visits to the Company■ Tree planting (implemented at CPW)

universities

7 70
visitsPurchase of CO2 sequestration credit(19.00t-CO2)
Registration for Green Wave program*2

students■ Grade school campaign drive(Donation of books, satchels, uniforms, etc.,
by CPh and L&TC)

270

Donations for

Widen the Circle of Exchange
Communities and Aim to
Development

students

Contributions to Health & Welfare■ Table For Two*1(Facilitated domestically by the Chiyoda Group)

15

gatherings■ Japan Philharmonic performance of Beethoven’s"9th Symphony" concert invitations provided tothose with visual impairments(letter of appreciation recipients)

2550

25 CHIYODA GROUP Sustainability Report 2017sets

people invited43

and Collaboration with Local
Further Realize the Sustainableof Society

Collaboration with Yokohama City Council of Social Welfare■ In-house sale of products madeby people with special needs( CGH and Koyasu Oﬃce)

people participated

196,166

participants

37,200trees planted■ Cleaning operations(Implemented at Chiyoda Group in Japan, Chiyoda-Almana, and CSL)

350
Over

caps
recycled(Vaccine doses for 228 people)■ ECOCAP*3 collection(Implemented at Chiyoda Groupin Japan)200■ Blood donation(Implemented at CPh and L&TC)

participants

C TABLE FOR TWO

503

yen

(1,860 meals provided)*1: The TFT menu provided at employee dining halls includes a
20-yen donation, and each 20 yen can provide one school meal in adeveloping country.

donors*2: An initiative to spread the“Green Wave”across the Earth by tree planting and so on carried out on the International Day for
Biological Diversity established by the United Nations. (http://greenwave.undb.jp/index.html/)*3: Caps for PET bottles are collected at the oﬃce and the proceeds (approximately 860 caps provides a polio vaccine for one
person) are sent to developing countries.

CHIYODA GROUP Sustainability Report 2017 26

Chiyoda Corporation

Chiyoda Global Headquarters
Minato Mirai Grand Central Tower
4-6-2, Minatomirai, Nishi-ku, Yokohama 220-8765, Japan
Please direct inquiries
about this Sustainability Report to:
IR, PR & CSR Section

TEL : (81) 045-225-7741
FAX : (81) 045-225-4962
E-mail : Chiyoda_CSR@chiyodacorp.com