Makita Report2023
Ye a r End e d M a rc h 3 1 , 2 0 2 3

Long-term Target

Strong Company
Makita has set itself the goal of contributing to the creation of sustainable society and consolidating a strong
position in the industry worldwide as a global supplier of a comprehensive range of tools for creating comfortable homes and living environments, including cordless power tools, battery-operated outdoor power
equipment and pneumatic tools.

Management Policy/Quality Policy

1

2

3

4

Makita strives toexist in harmony
with society

Makita values
its customers

Makita is managed
in a consistent andproactive manner

Valuing a stalwart
corporate culture,
Makita encourages eachindividual to perform to
his or her highest level(a market-driven company).

(a company that observes
laws and regulations, acts
ethically and never allows
intervention of theanti-social organizations).

(a company that strives toexist in perpetuity byadhering to a soundprofit structure).

(a happy company).

Table of Contents
Management for Sustainable Growth

Makita’s Sustainability Management

3 Makita’s Value Creation History
5 Makita Today

29 	Progress of Makita’s Sustainability Management andMaterial Issues

7 Chairman’s Message

31 Society (Disclosure of Human Capital, etc.)

9 President’s Message

35 Environment

Makita’s Value Creation
13	Makita’s Vision and the Strengths That Support
its Realization
15 Makita’s Value Creation Process		39 Initiatives in Line with the TCFD Recommendations
45 Corporate Governance		49 List of Directors
		51 Messages from Outside Directors

17 Contributions to Solving Social Challenges

Corporate Data

21 Business Overview

55 11-Year Summary

23 Financial & Non-financial Highlights

57 Stock Information

25 	Message from the Director of
the Administration Department

58 Corporate Data

1

Makita Report 2023

About This Report
Editorial Policy

This report covers 54 companies, including Makita Corporation and its 53

The Makita Report is published with the objective of presenting the Company’s

consolidated subsidiaries (as of March 31, 2023), but some of the information

initiatives for creating value over the medium- to long-term in a way that inte-

reported only covers Makita Corporation.

grates both financial and non-financial information. In preparing the report,
information that is particularly important for the Company’s value creation was

Reporting Period FYE 2023 (April 1, 2022 to March 31, 2023)

compiled concisely, referencing international frameworks such as those of the

However, information from outside of this period is reported when it isInternational Financial Reporting Standards Foundation (IFRS). Please see the­appropriate to the presentation of past circumstances and data as well as

Company website (https://www.makita.biz/) for more information. In addition,

recent examples.

financial information, environmental information, and governance information
is presented in detail in the Additional Information, Earnings Release andIssued: July 2023

Fact Sheet in the Investor Relations section of the Company’s website,
Environmental Report, and the Corporate Governance Report, respectively.

Disclosure System Diagram

Main Content

Financial
Information

Non-financial
Information

Periodic Report

Latest Information• Annual Securities Report• Financial Results• Fact Sheet• Environmental Report•C orporate Governance
ReportMakita Report

Makita’s website

Caution Regarding Forward-looking Statements
In this report, forward-looking statements are about future performance and are based on the Company’s judgment derived from the information available atthe time of its preparation. Please understand that a number of important factors could cause actual results to differ materially from those presented in the­forward-looking statements.

Makita Report 2023

2

Management for Sustainable Growth

Makita’s Value Creation History

Continuously Evolving to Meet the Needs of theTimes and Our Customers
Makita began in 1915 as a repair and sales company handling such items as lighting equipment, electricmotors, and transformers. Since then, we have pursued expansion on a global scale, evolving to overcome
challenges while meeting the needs of our customers and the times. By leveraging our strengths, including
a worldwide network of sales and service bases, we will continue to evolve, becoming “a Supplier of aComprehensive Range of Cordless Products” and achieving further growth. Moving forward, Makita will
ensure the provision of products and services that accurately meet the needs of our customers and thetimes and thereby achieve sustainable growth.

Highlights of Makita’s Evolution

1958-59

Overcoming Adversity, Becominga Power Tool Manufacturer

1970

Taking the First Step toward Overseas Expansion

The recession following the Korean War caused a slump insales, and developing original products became an important management issue. After much trial and error, in 1958,
the first Japanese-made portable electric planers werelaunched with the catchphrase “20 times more efficient thana human.” The electrification of this product was wellreceived, and perfectly met the needs of carpenters nationwide amid a boom in construction demand. On the tailwindof the planers’ popularity, in 1959, the Company decided towithdraw from the electric motor business and becomea power tool manufacturer.

As Japan began to see a slowing of the rapid pace of postwar
economic growth, Makita established its first overseas­subsidiary, Makita U.S.A. Inc. in the U.S., with the goal of
expanding exports. In a fierce market crowded with competitors, including major power tool manufacturers, we hadsome difficulties at first. However, we developed a finely
tuned sales strategy that reflected the value we place on
being close to customers, and our products’ excellent cost
performance along with our high quality after-sales service
earned high evaluations. As a result, we were able to­successfully penetrate the North American market.

1915 Mosaburo Makita founded Makita Electric1958 Released the 1000 portable electric planer, Japan’s first such

Works (proprietorship) in Nagoya, Japandomestically produced tool1938 Incorporated the proprietorship and1959 • Decided to convert to a power tool manufacturer

established Makita Electric Works, Inc.

1945 Moved to the present location in
Sumiyoshi-cho, Anjo City, toaccommodate World War II­related evacuations• Shipped the 1300 hand-held electric planer toAustralia, our first export of power tools

1962 Changed company name to Makita Electric Works, Ltd.
1970 Established Makita U.S.A. Inc.,
our first overseas subsidiarySocial Changes and the Value Makita Offers

SocialChanges

1910-

1950-

1970-

Japan’s modernization

Japan’s rapid postwar
economic growth

Globalization of the economy
triggered by two oil shocks• Arrival of the construction
boom• Companies expanded overseas

Released Japan’s first­portable electric planer

Began building afinely-tuned sales and­service network thatspans the globe• Increased demand forelectric power

Began repairing and­selling lighting equipment,
electric motors, transformers, and other products

The Value
Makita Offers

3

Makita Report 2023

Revenue(Consolidated)¥764.7billion(FYE 2023)

2005-

Moving toward Becoming “a Supplier ofa Comprehensive Range of Cordless Products”
for Sustainable Growth with Society
In recent years, the world has seen a rise in the severity ofsuch social issues as labor shortages and environmental
problems. Looking to provide solutions, Makita has focusedon lithium-ion batteries and, in 2005, was the first in theindustry to launch professional-use cordless power tools withlithium-ion batteries. We are now taking steps to evolve into“a Supplier of a Comprehensive Range of Cordless Products,”
aiming to achieve our long-term goal of being a “Strong
Company” and to resolve a wide range of social issues whilebalancing the sustainable growth of the Company.
1991 Changed company name to Makita Corporation

2015 100th anniversary of Makita’s founding
2019 Launched the Li-ion 40Vmax series
2005 Launched the TD130D cordless impact driver, our firstlithium-ion battery tool

2022 • Discontinued engine-powered products• Established the Electronic Control
Development Center (Tokyo Office)1980 Started production of power tools in Canada,* our first overseas
production site
* Production terminated in January 2009

2000-

2010-

2020-

Discovering the sustainable
society concept

Toward a diverse,­inclusive society

Realizing a sustainable
society• Heightened interest in ­environmental
issues and strengthening measures
to prevent global warming• Growing demand for energy
conservation and efficiency• Adoption of SDGs leads toglobal efforts toward a sustainable society• Acceleration of initiatives torealize decarbonization

Began selling professional
cordless tools with­lithium-ion batteries

Launched a varied lineup of cordless products that contributeto the resolution of social issues

Makita Report 2023

4

Management for Sustainable Growth

Makita Today

Supporting the Creation of an Affluent Society on
a Global Scale
As a global supplier of a comprehensive range of tools for creating comfortable homes and living
environments, Makita supports the creation of an affluent society on a global scale. To this end,
we are striving to solve social issues and contribute to the realization of a sustainable society bymaking a wide variety of products cordless and expanding our finely-tuned sales and service­network, utilizing diverse human resources, and developing our business close to our customers.

Business Description
Power Tools
Makita power tools are used in many settings, such as
residential and large-building construction sites andfactories. Since becoming the first company in Japan to
manufacture and sell portable electric planers in 1958, we
have dedicated ourselves to daily technological development
to enable better approaches to work that includes drilling,clamping, cutting, grinding, and more. We are responding to
the diverse needs of customers with a robust lineup of products
embodying our advanced technological expertise.

Outdoor Power Equipment, Household, and Other Products
In the outdoor power equipment category, which
includes lawn mowers, grass trimmers, chainsaws, andblowers, we are focusing on developing cordless productsthat are lightweight, low noise, and easy-to-handle for­people from all walks of life as well as emitting zero exhaust,
thereby also contributing to the realization of decarbonization.
Makita’s household product line includes the cooler & warmer
box, microwaves, and other items that fulfill key roles during­outdoor activities or even at times of disaster.

Parts, Repairs, and Accessories
Accessories (including consumable parts such as saw
blades and whetstones) have a significant impact onwork quality and efficiency. Makita provides a lineup of
long-life accessories optimized for work tasks. Additionally,
we have a network of businesses in each part of the world
to allow for rapid and stable repairs and parts supply, whichenables Makita to contribute to improving its ­customers’­production and work efficiency.

5

Makita Report 2023

Global Network and Diverse Human Resources
Makita operates 129 sales offices in Japan (as of April 2023), and directly manages sales bases in some 50
countries overseas, allowing us to sell our products in approximately 180 countries. Through the localizationof management, we are able to provide fine-tuned sales and services in line with the needs of the customers
in each country, and diverse human resources play an active role in business operation in the Company, withthe ratio of overseas employees exceeding 80%. We have plants in eight countries, including Japan, and produce about 90% of our products overseas. By maintaining production sites and sales offices with inventories
at locations around the world, we are able to ensure the swift and stable supply of our products.

Makita Corporation Head Office
Sales Subsidiaries

Sales and Production Subsidiaries

Sales Subsidiary BranchesService Centers

Production Subsidiaries
Technology Development SubsidiaryJapan
EuropeShare of
Revenueby Region(FYE 2023)

Share of
Revenue by
Product Category(FYE 2023)

North America

16.1%
45.6%
15.6%

Asia
(excluding Japan) 7.0%
Central andSouth America
Oceania

6.2%
7.6%

 he Middle East
T
and Africa

1.9%Power Tools 

54.8%

Outdoor Power
Equipment,
Household andOther Products 25.6%

 arts, RepairsPand Accessories  19.6%

Overseas

Overseas andDomestic
Production(Product Unit Basis)(FYE 2023)

92.1%

Domestic

7.9%

Non-Japanese

Breakdown of
Employees by
Nationality(FYE 2023)

81.9%

15,405 people

Japanese

18.1%
3,399 people

Makita Report 2023

6

Management for Sustainable Growth

Chairman’s Message

Utilizing Our Unparalleled Strengths
in Production Resources to Further
Makita’s Distinct Business Model
Chairman,
Representative Director

Masahiko Goto

7

Makita Report 2023

Focusing on the Market Shift to Cordless Products and Stepping up
the Pace of Investment
Makita believes that the global shift toward decarbon-

to this issue, unlike other companies which tend toization is what is driving the rapid increase in the transi-

embrace 10-year investment timetables.

tion from engine-powered to cordless products aroundThe benefit of moving quickly is that it has enabled us

the world. This is, in turn, triggering heightened demand

to already acquire a large share of the market for cordlessfor Makita’s cordless outdoor power equipment (OPE),

OPE, especially in Japan, where we are recognized as thean area in which we were already making major invest-

leader in the field. This shift in our image is having a sig-

ments in over the past few years. Looking to expand

nificant impact on how we do business. At a typical­cordless OPE sales, we have been investing in the­cruising speed, capital expenditures would be ¥15 to ¥20­construction and expansion of new distribution facilities

billion per year, but we have invested ¥40 to ¥60 billion

and the establishment of sales offices in regions withevery year for the past three years. Right now, lawnstrong potential markets for cordless OPE.

mowers are our best-selling OPE, and are physically larger

The speed of the shift towards cordless products

than other cordless power tools by 10 times, underscor-­varies by region. In Europe and Oceania, the situation is

ing our need to establish a large distribution center. The

expected to continue advancing rapidly while, in devel-

global shift towards decarbonization will continue tooping countries, the pace remains slower. Nevertheless,accelerate, and we have already completed the neces-around the world the march toward cordless productssary investments to keep up with it. With the market

seems unstoppable. To ensure that we will not miss out

steadily shifting to cordless products, we expect to see

on future demand, we are taking a five-year approachthese investments yield solid results moving forward.

Getting Close to Customers:
Leveraging Makita’s Unique Business Model
Makita has a distinctive business model in which wethe most valuable way to make the most of the salesdeliver products from bases located near our customers,

network it has built up over the years, and this is what

which enables us to pick up products if they needmakes Makita stand out from its competitors.

repairs and deliver them back to the customers when

I believe that the recent upfront investments haverepairs are complete. Makita’s unique approach ofallowed us to establish a system for providing services

establishing sales offices across the world in order toclose to our customers. We will continue refining ourbetter reach customers has been a constant since thestrong after-sales services to differentiate ourselves fromdays of Jujiro Goto.

our competitors. At the same time, we will continue

A common characteristic of cordless power tools andstriving to become a “Strong Company” by properly

OPE is that after-sales services like repairs are always

responding to changes in the business environment

essential. Our overseas competitors are overly focused

while continuing to leverage our strengths as

on efficiency. The choice is simple: to be close toa global company.

­customers and thus enhance their convenience or to
pursue efficiency. Makita believes that creating relationships with each and every one of its many ­customers is

Makita Report 2023

8

Management for Sustainable GrowthPresident’s Message

We Never Stop
Working towards
Long-term Growth
Rapid Environmental Change Led to a Decline after
Two Consecutive Fiscal Years of Record-high Profits
2022 was a year of massive change. The ongoinggrowth, and I believe they will prove beneficial

Russian invasion of Ukraine led to increased energy

regardless of fluctuations in ­market conditions.

costs and inflation, and demand declined rapidly

Our inventories must be appropriate for theafter a state of shortages. These fluctuations in the­current market. The stay-at-home demand seen

business environment significantly impacted

during the pandemic has declined, and we will

Makita’s performance, which had registered record

work to optimize inventories at levels appropriate

profits for two consecutive years through FYE 2022,

to our business. Logistics costs are still higher thancausing a sudden decline.

pre-pandemic levels but are starting to stabilize as

Despite the severe financial results, Makita’s
efforts to provide its full services in the face of9

air transport for deliveries from factories to our­various markets is no longer required.

shortages have been well received, and we wereAs logistics costs skyrocketed, we revised ourable to significantly raise sales compared to pre-shipping methods, including package sizes, to reduce

COVID-19 pandemic levels, especially in the field ofcosts. We have been making efforts to ­simplify

cordless outdoor power equipment (OPE), an area

­packaging and reduce single-use plastics in a switchof recent focus. Although creating larger inventories

to an environmentally friendly approach. I expect

in response to shortages was a short-term solution,

to see even more positive results as shipping

Makita’s investments are aimed at long-term­volumes recover.

Makita Report 2023

President,
Representative Director

Munetoshi Goto

Makita Report 2023

10

Management for Sustainable GrowthPresident’s Message

As the Environment Becomes
Even More Diverse and Complex,
Makita Can Demonstrate
Even More Aspects of Its Strengths
Strong Impression of Cordless OPE Sales in Focus Areas
In cordless OPE, which is an area of new growth, I amawareness of our lineup of products for professional

getting a very strong impression that the growing

use is expanding even further.

awareness of the shift to cordless products has paralleled

Some of our hit products include hedge trimmers andthe expansion of stay-at-home demand. The number ofsmall chainsaws. We have launched new lawn mower

cordless products that can adequately replace engine

products, which command a large market, for professional

products in terms of capacity suitable for professionaluse and are increasing sales. We will continue to accelerate

use has recently increased, while there are still many

the development of high-quality, high-­performance

products available for the general public. Professionals

products made for professionals. I also believe that ourcan now enjoy the benefits of Makita’s cordless prod-

after-sales service is a principal ­deciding factor for profes-

ucts, and further decarbonize their ­operations without

sionals when they choose Makita. We will continue tosacrificing work efficiency.

make full use of our sales and service network, which we

Customer feedback cites significant improvements,
including in management costs, which shows thathave further enhanced through investment, and work toprovide high quality after-sales service in every region.

Promote Sustainability Management with the Aim of Contributing
to the Environment and Society
In 2021, we established the Sustainability Committee,

To utilize Makita’s human capital, Makita has estab-on which I serve as chair, to ensure we understand current

lished a system that recognizes employees for their abil-trends toward decarbonization, accelerate our efforts

ities and performance regardless of gender, race, or

toward carbon neutrality, and thoroughly implement

other attribute. In addition to this structure, we aresustainability management throughout Makita. As partworking to build an environment in which diverseof our environmental efforts, we will continue tohuman resources can play active roles globally through­contribute to decarbonization by providing cordlesspolicies to quickly train new human resources to be

products with zero emissions during use.

competitive, promote women’s advancement, and11

Makita Report 2023

encourage employees to take childcare leave. While­comprising a majority of Outside Directors, to facilitate

simultaneously updating past initiatives in line witheffective discussion and enhance the effectiveness ofrecent social changes, we are working to create

the Board of Directors.

a ­comfortable working environment for employees that

In addition, Makita’s first female director (an Audit &allows them to demonstrate their abilities and leads toSupervisory Committee Member) was appointed at thegood performance.

June 2023 Ordinary General Meeting of Shareholders,Turning to governance, Makita became a Company

improving the Board’s diversity. I am looking forward towith an Audit & Supervisory Committee in 2021 andher supervision and advice as a certified public accountant,increased the ratio of Outside Directors on the Board ofas well as her unique perspective as a woman.

Directors to one-third. In addition to the Audit &Going forward, we will continue striving to enhanceSupervisory Committee, we also established theour governance based on dialogue with stakeholders.

Nomination and Compensation Committee, also

Aiming to Be a “Strong Company” to Build the Next Hundred Years
I believe that contributing to the environment andbusiness environment becoming ever more diverse and­society will be a source of future sustainable growthcomplex, I feel that our strengths will be tested inthat will enable us to become a “Strong Company.” We

an increasingly large number of situations.

recognize that it is increasingly important to contribute

After our recent period of rapid growth, you could

to social and environmental issues through our production

say there was a sudden halt, and we apologize to ouractivities and services.

stakeholders for any concerns this may have aroused.

Makita has always been committed to ensuring thateach of its customer-facing business bases around theworld has carefully considered and defined the work to

Even under these circumstances, Makita will continuously
implement measures for long-term growth.
We will continue striving to contribute through ourbe accomplished, and taken responsibility for its

business to society and the environment, and we ask foractions. This is the character that has made it possible

your continued support and confidence in Makita’sfor Makita to respond flexibly at every business base to

growth over the long term.

actual local conditions in every region. With the

Makita Report 2023

12

Makita’s Value Creation

Makita’s Vision and the Strengths That Support
its Realization

Makita’s Vision
Makita has set itself the long-term target of becoming
a “Strong Company” and is striving to contribute to the creation of a sustainable society and consolidate a strong
position in the industry worldwide as a global supplier of
a comprehensive range of tools for creating comfortable homes and living environments, including
cordless power tools, battery-operated outdoor
power equipment, and pneumatic tools.
On the financial side, it is Makita’s basic
policy to maintain a business structure thatis resilient in the face of unforeseenchanges in the business environment
while working to both sustainably
enhance corporate value andsecure stable dividends for ourshareholders and investors.

13

Makita Report 2023

The Strengths That Support the Realization of
Makita’s Vision
Development
In 2005, Makita was a pioneer in selling professional-grade

available in several voltages for various applications andelectric power tools utilizing lithium-ion batteries, and thiseach battery can be used with a range of our products, mak-provided the catalyst for our launch of a number of new

ing high compatibility and a rich product lineup one of ourcordless products that utilize our industry-leading battery

major product strengths.

charging/discharging technologies and motor technologies.

In recent years, we have been expanding and enhancing

Makita’s provision of the industry’s preeminent lineup of

our cordless products beyond power tools to include outdoor

products is the direct result of proactive development over a

power equipment (OPE); cleaning equipment such as clean-broad range of product categories, including cordless prod-ers; and products with utility for outdoor activities and times

ucts that provide alternatives to AC products with powerof disaster when power sources are difficult to come by suchcords and engine-powered products. Moreover, b­ atteries areas cooler & warmer boxes and microwaves.

Production
With production bases in eight countries (Japan,

In addition to taking advantage of the persistent ingenuity

China, Romania, Thailand, the U.K., Brazil, the U.S., andof employees in our factories, we are adopting and utilizing

Germany), approximately 90% of Makita products on

cutting-edge technology, such as IoT and robotics, to build

a product unit basis are manufactured overseas. By main-a framework that can efficiently manufacture consistently

taining production bases in major regions around the world,high-quality products anywhere in the world, regardless of

we are positioned to not only promptly address currency,

the experience or intuitive understanding of individual workers.

disaster, geopolitical, and other risks but to quickly meet

By deploying and sharing our ingenuity and know-how relatedchanges in demand in each region. In recent years, we haveto thorough waste elimination at every factory, we are con-been working to increase production capacity in anticipation

tinuing our efforts to pursue an even more advanced level ofof sales expansion and the further multipolarization ofcraftsmanship to ensure stable and profitable manufacturing­global production.

even in a changing cost and demand environment.

Sales and Services
Makita operates 129 sales and service bases in Japan (as ofusing this network to gather feedback on our products andApril 2023) in addition to directly managed sales bases inservices from customers throughout the world, we cansome 50 countries overseas, allowing the execution of fine-understand their needs and incorporate them into plans fortuned sales and services. One of our strengths lies in our

new products and services.

industry-leading sales and service network around the

In recent years, sake of cordless OPE, which are physicallyworld, where we provide customer- and community- basedlarger than power tools, have been growing worldwide, andservices. Moreover, Makita’s policy is to maintain inventories

we have proceeded by establishing new and expanded dis-of products and repair parts at each location to ensure thetribution bases, and establishing bases close to the cordlessprompt and stable provision of products and services, and to

OPE market. With the foundation for customer service com-be ready to respond to supply chain disruptions. We are able

pleted, going forward we will continue to fully utilize ourto contribute to efficiency and productivity gains for customers,

existing locations to enhance our services.

which helps us build trusting relationships. In addition, by

Makita Report 2023

14

Makita’s Value Creation

Makita’s Value Creation Process

Leading the
Way with
Cordless

Comprehensive
LineupMakita’sStrengths
p. 14
Sales andServices
NetworkGlobalExpansion

Input

As a global supplier of a comprehensive range of tools for creating
comfortable homes and living environments, Makita provides
power tools, outdoor power equipment, outdoor products helpful
in times of disaster, and a wide range of cordless products to­contribute to affluent communities and daily lives on a global
scale. In addition, Makita is helping realize a sustainable society
through its business, including by developing cordless productsthat contribute to solving social issues.

Material Issues pp. 29-30

Business Model p. 14

Financial capital• Equity attributable to ownersof the parent

¥769.2 billion• Cash and cash equivalents¥162.7 billion

Reducing
environmental
impactHuman capital• Number of employees Number ofoverseas employees 
Number of
female employees 

Development

18,804
15,405
6,173

Social capital

Contribution
to affluent
communities
and daily lives•Number of sales and service bases  Japan 129 (as of April 2023)   Overseas Approx. 50 countries• Number of countries where Makita
sells products Approx. 180

Manufacturing capital

Makita’svalue chain

Sales
and
services

Production

Strengthening
the management base• Plants 8 countries(including those in Japan)• Capital expenditures ¥39.1 billion

Intellectual capital• R&D costs ¥14.9 billion

Natural capital• Energy usage 204,556 MWh• Water usage 112,095 m3

Platform Supporting
Sustainability
Management Policy/(non-consolidated)(Fiscal year ended March 31, 2023)

15

Makita Report 2023

Sustainable GrowthLong-term Target

Strong Company
p. 13

Makita has set itself the goal of contributing to the creation of sustainable­society and consolidating a strong position in the industry worldwide as a global
supplier of a comprehensive range of tools for creating comfortable homes andliving environments, including cordless power tools, battery-operated outdoor
power equipment and pneumatic tools.

OutputSocial Challenges pp. 17-20

Value for Stakeholders
Society, including Customers• Reducing environmental impacts

Decarbonization• Boosting work efficiency andproductivity

Plastic waste
Promoting the elimination of plastic

Air pollution

Cordless
products

Network offinely tuned
bases/Promptand stablerepairs anddistribution

Noise
Contribution tocommunities
and daily lives
Labor shortages
Frequent natural
disasters/disasterreconstruction

Comfortable outdoor work

Management

pp. 28-54

Quality Policyp. 1• Early recovery from disasters• Peace of mind during times of disasterp. 20

OccupationalsafetyMakitap. 38

Shareholders and Investors• Medium- to long-term enhancementof corporate value• Returns to shareholders
Dividend payout ratio 
Operating profit ratio 
EPS 

48.7%
3.7%
¥43.11• Enhancement of information disclosure
Meetings with shareholders
and investors 
237(Fiscal year ended March 31, 2023)
pp. 25-27

Employees• Workplaces where diverse humanresources can work with passion
and enthusiasm• Systems that create an environment
supportive of employees’
self-driven growth
Average length of service offemale employees 
16.8 years(non-consolidated)
Percentage of female managers

17.4%(Makita Group, consolidated)
pp. 31-34

for Makita

Business Partners• Realization of fair, equitable,transparent, and honest transactions• Sustainable supply chain throughCSR procurement
p. 34
Makita Report 2023

16

Makita’s Value Creation

Contributions to Solving Social Challenges

We will continue contributing to the realization of a sustainable society by solving social challenges suchas environmental issues through our products and services. We will work to evolve into “a Supplier ofa Comprehensive Range of Cordless Products,” extending beyond cordless power tools to include cordlessoutdoor power equipment (OPE) as well as cordless cleaning and outdoor products, by continuing to
expand our range of convenient, environmentally friendly cordless products. At the same time, we will
strengthen systems for promptly and stably providing services such as repair and distribution by building
a network of sales and service bases that is finely tuned to each location around the world and will also
strive to ­realize decarbonization and reduce workloads in worksites worldwide.

Environment
Decarbonization
Plastic waste
Promoting the elimination of plastic
Details on p. 38

Air pollution

Cordless Products
Noise
Contribution tocommunities anddaily lives

Network of Finely
Tuned Bases/
Prompt and Stable
Repairs and Distribution

Labor shortages
Frequent natural
disasters/disasterreconstruction
Occupational safety
Comfortable outdoor
work

17

Makita Report 2023

Society

Cordless
Products

Merits of Cordless Products• Improve work efficiency and ease of use•H elp prevent onsite accidents, for example, by eliminating thetripping hazard of power cords• I ncrease work efficiency in locations where it is difficult to secure
a power source•P roduce zero emissions, low noise, and low vibrations duringuse, unlike engine-powered equipment

Makita, which has grown as a manufacturer of power tools, is now working to evolve into “a Supplier ofa Comprehensive Range of Cordless Products.” This evolution entails leveraging the battery charging/­
discharging as well as motor technologies we have amassed through our power tool development to­expand our lineup of cordless products. Cordless products feature improved safety, convenience, andcomfort for customers as well as zero emissions during use, low noise, and low vibrations. They also help
to resolve social issues, such as labor shortages in the workplace. Among these products, cordless OPE,
which we are promoting as a replacement for engine-powered equipment, helps realize decarbonization
amid mounting awareness of climate change. The use of OPE also contributes to “Climate Action,” one of
the goals set by the SDGs. Going f­ orward, we will continue contributing to the elimination of engine-­
powered equipment and shift to cordless products by expanding our range of cordless products, thereby
contributing to solving social issues.

Network of Finely Tuned Bases/
Prompt and Stable Repairs
and Distribution
Makita continues to expand its network of sales and service bases in locations around the world and is
working to reinforce the sales and service system. With bases in each country and region, our inventories
of products and parts for repairs facilitate the provision of services, including prompt and stable repairs,
and distribution in addition to sales. By developing a service system that offers prompt and stable repairs
and distribution, we play an essential role in improving our customers’ workplace efficiency and productivity
as the inability to use tools due to malfunction and the inability to acquire needed products promptly
leads to work delays and reductions in efficiency. In particular, despite restrictions on cross-border­movement during the COVID-19 pandemic, Makita was able to help local communities by delivering products and services promptly and reliably thanks to its bases in various countries and regions worldwide. Asan essential business, we were permitted to continue our business activities in many regions even under
lockdown. Moreover, our products and services, which are essential for affluent urban development andlifestyle development are also contributing to “sustainable cities and communities,” one of the goals of
the SDGs. The expansion of our network of bases that support activities embedded in local communities
will lead to the realization of a sustainable society right around the world. Going forward, we will strive tofurther strengthen our service system by efficiently utilizing the distribution functions that we have invested
in over the past several years.

Makita Report 2023

18

Makita’s Value Creation

Contributions to Solving Social Challenges

Environment

Environmental Contributions
We are contributing to the realization of decarbonization by replacing conventional engine-powered OPEwith cordless products that emit zero emissions during use. As awareness of environmental issues grows,
demand for cordless OPE is expected to increase. We are strengthening cordless OPE as the next pillar of our
future business in addition to power tools. Making products cordless ensures no exhaust gas emission­containing air pollutants, and the low noise level of such equipment compared to the engine-powered­equipment also contributes to a lower environmental impact. Please see pages 35–44 for details.

SocietySocial Contributions
Through its robust network of bases, Makita contributes to communities anddaily lives around the world by selling and servicing power tools and OPE
used at construction sites in approximately 180 countries. Makita offers many
products that are indispensable for building infrastructure and are an essential
part of our contribution to affluent communities and daily lives.
Labor shortages present challenges for construction sites worldwide.
Makita’s cordless power tools are helping address labor shortages by actively
replacing the AC products with power cords that were the previous norm
with more efficient cordless versions. In addition to the cord-free advantagesof efficiency and ease-of-use, cordless products help prevent accidents in the field, such as tripping overpower cords. Along with being able to be used in situations where securing a power source is difficult, cordless power tools offer a number of advantages over engine-powered products, including ease of starting andmaintenance, and in many instances Makita’s cordless power tools like chainsaws, power cutters, and otherequipment have replaced their engine-powered counterparts at disaster sites. In addition to these advantages,
we offer prompt and stable repair and logistics services that take advantage of our network of finely tuned
sales and service bases, thereby contributing to improved efficiency and productivity at worksites, which, inturn, supports comfortable urban development and encourages early recovery from disasters, a more frequent
occurrence due to climate change. Moreover, our cordless products include radios, lights, and other productsthat are useful in times of disaster as well as fan jackets and other products that help protect against the heat,providing peace of mind and improving the comfort of outdoor work.

19

Makita Report 2023

Value Offered to Society, Including Customers

1. Reducing Environmental Impacts
Cordless OPE emits zero exhaust during use and contributes to decarbonization. Furthermore, in addition
to not emitting exhaust gas or other atmospheric pollutants, OPE is quieter than engine-powered­equipment and has a significantly lower environmental impact.

2. Boosting Work Efficiency and Productivity
In addition to the unique merits of cordless products—including improving safety, convenience, and­comfort for customers—Makita contributes to efficiency and productivity gains for customers by providing
prompt and stable repairs and logistics services leveraging our robust network of bases.

3. Early Recovery from Disasters
Makita products are indispensable for building infrastructure and play a vital role in disaster recovery.
Utilizing our robust network of bases to promptly and stably deliver cordless products and services that
contribute to efficiency and productivity gains, we support early recovery from disasters.

4. Peace of Mind During Times of Disaster
During times of emergency, batteries for cordless products can function as backup power sources. For
example, batteries used in cordless cleaners and the like can also be used to power radios and lighting
equipment. Also, with a USB adapter, these batteries can charge smartphones and add an extra degree ofpeace of mind if a disaster occurs.

Aiming for Coexistence and Mutual Prosperity with Stakeholders
A Worldwide Network of Bases Supporting the Makita Brand
Reconstruction demand from the Ise Bay typhoon in 1959

­partners through difficult times. This source is supported

was a major catalyst for Makita’s development as a powerby our network of finely tuned offices around the world.

tool manufacturer, and this instilled in us the awarenessIn recent years, climate change has resulted in frequent

that we must always stand in support in times of disaster.

typhoons, torrential rains, and other natural disasters that

When a disaster occurs somewhere in the world, we

have caused extensive damage in many parts of the world.

actively support our customers, and when the office in

We will always stand in support in times of disaster, and we

charge of the disaster-stricken area reports the situation

aim to grow together with society by staying close to ourto the Head Office, the status of support activities for our

stakeholders, including our customers, and working together

customers is included in the report. This attitude permeatesto overcome difficult times, as well as by utilizing our finely

every corner of the Company. The source of the Makita

tuned network of offices to quickly and stably provide

brand is the trust we have built by standing with our­products and services useful in disaster reconstruction.
Makita Report 2023

20

Makita’s Value Creation

Business Overview

Market Environment
Despite earlier uncertainty in the economic climate
caused by the spread of COVID-19, demand for tools foruse on construction sites has remained strong as economic
and social activities normalize. Moreover, trends toward
energy-saving and energy-generating buildings and the
spread of EV recharging facilities have been picking up
against a backdrop of rising environmental awareness,
providing favorable conditions for environmentallyfriendly products and driving demand for cordless­systems to replace engine-powered systems. However,

the outlook remains somewhat clouded due to highinflation, monetary tightening in various countries, andthe sharp rise in energy prices triggered by the Ukraine
conflict, which has caused a decline in business­confidence. Amid this environment, we aim to achieve­sustainable growth by evolving into “a Supplier ofa Comprehensive Range of Cordless Products” by leveraging and further refining our strengths, including our
extensive cordless product lineup and finely tuned sales
and service network.

Fiscal Year in Review
In FYE 2023, the outlook was uncertain due to highinflation, monetary tightening in various countries, andthe sharp rise in energy prices triggered by the Ukraine
conflict, which caused a decline in business confidence.
Despite lagging demand due to declining business­confidence and weak returns in local-currency terms invarious regions, the depreciation of the yen lead toa 3.4% increase in revenue during FYE 2023, whichreached a record high. Operating profit decreased
69.2% from FYE 2022, due to the impacts of foreignexchange rates, higher raw material prices, and higher
selling, general and administrative expenses.

Future Strategies
Expanding Our Cordless Lineup
Makita is further expanding its lineup in accordancewith its goal to be “a Supplier of a Comprehensive
Range of Cordless Products.” In power tools and cordlessoutdoor power equipment (OPE), we are actively replacing
AC products that have power cords and engine-powered
products with cordless products. In addition, we are
expanding the range and applications for cordless­products that use our batteries, introducing models withapplications not only for worksites but also for outdoor

21

Makita Report 2023

work and in times of disaster when it is difficult tosecure power sources. Such products include cooler &warmer boxes and microwaves as well as cleaning
equipment for such uses as building maintenance.
In particular, demand for cordless OPE is expected to
grow as the trend toward decarbonization intensifies,
and we will further augment our lineup with productsthat provide the same level of usability as engine-­
powered products.

Utilizing Human Capital
As Makita continues to expand its business globally, we
believe it is important to have a global, diverse workforce capable of carrying on this growth into the future.
To ensure optimal human capital utilization, we have set
indicators for the following: the swift training of new
human resources to be competitive, the promotion of
women’s advancement, and the encouragement of
employees to use childcare leave. Through our efforts toachieve these goals, we will create an environment inwhich diverse human resources can play an active role
globally, regardless of gender, leading to Makita’s­sustainable growth. For details, please see pages 31–33.

Strengthening Services through Digitalization
With the construction of new sites and the expansion offactories, labor shortages will be an ever-present challenge.
In addition to focusing on the recruitment and trainingof human resources, we are advancing digitalization to
improve productivity. For example, sales offices in Japanare computerizing clerical work, including the use ofelectronic voucher storage and paperless correspondence, to improve operational efficiency and customer
response time. Also, to improve IT services for overseas
customers, we are enhancing the functions of our­specialized website for distributors with an eye toimproving convenience and the operational efficiency of
our sales subsidiaries. Furthermore, by implementing
a Content Management System (CMS) to centrally­manage the product specification and technical­information required for the provision of after-sales­services, the details of which differ by country, we areestablishing the necessary infrastructure to improve IT
services for customers and expanding the capacity of
our internal operations.

Improving Operational Efficiency through the Use of
Digital Technology
Despite the challenging business environment, we areutilizing digitalization and working to improve operations to ensure a strong management foundation. For
example, digitalization at our subsidiary in Brazil beganwith the identification of tasks requiring improvement
at the IT department of the Japan Head Office,International Sales Headquarters, and the Brazilian­subsidiary, with the goal of reducing operational waste
and creating a system that allows the subsidiary to focus
on high value-added tasks and thereby strengthen its
management foundation.

1. Inventory Ordering
Previously, our inventory ordering process wasa time-consuming and burdensome task involving
determining the volume of orders to be sent tofactories based on net decreases and increases ininventory due to fluctuations in the number ofunits sold. Furthermore, there was the challenge of
insufficient order number analysis. We are currently
developing a program to reduce the time required
to calculate relevant data and to improve inventoryorder count analysis accuracy in order to optimizeorder quantity and stabilize asset management.
2. Import/Export Management Tasks
In import/export management, we have faced thechallenge that many tasks have historically relied
on individual experience, which has meant that
operations have been overly dependent on a single
person, making it time-consuming to reply to shipment status confirmations from sales destinations.
To address the issues, we are revising and standardizing our business processes to eliminate theneed for reliance on individuals, and are creatinga portal site that allows us to share shipment status
directly with customers, reducing the number ofinquiries and thereby reducing labor costs.

Through digitalization, we will work to improvec­ ustomer convenience and eliminate waste throughout
all internal operations to overcome the recent severebusiness environment.

Makita Report 2023

22

Makita’s Value Creation

Financial & Non-financial Highlights

Financial
Revenue

Operating Profit & Operating Profit Ratio(Million yen)

(Million yen)(%)

100,000

25.0

700,000

80,00020.0

600,000

60,00015.0

500,000

40,000400,000

20,000800,000

0764,702

2019

2020

2021

2022

2023

0
(FYE)

28,246

10.0
5.0

3.7
2019

Operating profit

2020

2021

2022

2023

0
(FYE)

Operating profit ratio

Against the backdrop of robust sales in Japan and Oceania and thedepreciation of the yen against local currencies, revenue increased by
3.4% year-on-year to ¥764,702 million, a record high for the sixth­consecutive year.

Due to skyrocketing material and labor costs, operating profit declined
69.2% year-on-year to ¥28,246 million. The operating profit ratio was
3.7%, down 8.7 percentage points from the previous year.

Profit Attributable to Owners of the Parent

ROE(Million yen)(%)

80,00012.0
10.0

60,0008.0

40,000

6.0
4.0

20,000011,705
2019

2020

2021

2022

2023

1.5

2.0
0
(FYE)

Profit attributable to owners of the parent declined 81.9% year-on-yearto ¥11,705 million.

2019

2020

R&D Costs

Capital Expenditures(Million yen)

14,903

2022

2023

(FYE)

Due to the decrease in profit attributable to owners of the parent, ROE
declined 7.7 percentage points from the previous year to 1.5%.

(Million yen)

15,0002021

60,00050,00010,00039,08840,00030,0005,000

20,00010,000

0

2019

2020

2021

2022

2023

0
(FYE)

To promote the use of rechargeable lithium-ion batteries, we focused on
expanding our lineup of cordless products, including the 40Vmax series,
and R&D costs increased 5.4% year on year to ¥14,903 million.

23

Makita Report 2023

2019

2020

2021

2022

2023

(FYE)

Capital expenditures totaled ¥39,088 million, down 34.8% from the previous fiscal year. The main factor impacting this figure was construction
costs associated with a new distribution center in Okayama Prefecture
and an additional factory building in Thailand.

Non-financial
Production Output

Number of Employees(Million units)

60.00

22,00050.00

20,00040.00

18,00030.00

16,00026.35

14,00020.00
018,804

2019

2020

2021

2022

0

2023

2019

(FYE)

2020

2021

2022

2023

(FYE)

Production output declined 47.3% to 26.35 million units year on year asa result of a cooling demand environment and inventory reductions.

The number of employees decreased by 1,429 from the end of the­previous fiscal year to 18,804.

Increasing Presence of Female Employees

Greenhouse Gas Emissions (Scope 1, 2)

Femaleemployees

100,000

6,173

Percentage offemale employees

32.8%

Femalemanagers

Percentage offemale managers

228

17.4%

(t-CO2)(t-CO2/100 mil. yen)

25.0

Fiscal 2030 targets

80,00020.0

44,83665,53360,00015.0

40,000

10.0

8.6

20,0000

5.0
2022

Emissions

2023

0
(FYE)

t-CO2

Fiscal 2040 targets

Virtually
zero

Intensity per unit of revenue

Domestically, female employees have an average of approximately 16.8
years of service and have been active in a variety of departments overlong periods of time. Overseas, Makita has numerous female employees
in management positions who are demonstrating a wide range of­abilities in their respective fields.

With the goal of achieving virtually zero greenhouse gas emissions (Scope 1,

Water Usage

Waste Emissions(m3)(m3/100 mil. yen)

300,000

251,728 75.0
56.1

200,000

50.0

400,000

100.0

112,095

100,000
0

27.0
2019

2020

2021

2022

2023

25.0
0
(FYE)

2) by fiscal 2040 (FYE 2041), we are actively utilizing renewable energy andengaging in thorough energy-saving activities. Greenhouse gas emissions(Scope 1, 2) decreased by 16.9% from the previous fiscal year to 65,533 t-CO2.

(t)(t/100 mil. yen)

30,00010.0

25,0008.0

20,00017,96415,000

4.0

10,000
5,000
0

2019

2020

2021

2022

6.0
4.0

3,864
0.9

2.0

2023

(FYE)

0

Water usage (Left axis)

Intensity per unit of revenue (Makita Corporation)

Waste emissions (Left axis)

Intensity per unit of revenue (Makita Corporation*)

Water usage (Left axis)

Intensity per unit of revenue (Overseas production subsidiaries)

Waste emissions (Left axis)

Intensity per unit of revenue (Overseas production subsidiaries)

We carry out monthly monitoring of water usage at business bases andCorporation rose 23.9% year on year to 27.0 m3/100 million yen and for

We are striving to reduce our final disposal volume of waste by thoroughly sorting
waste in order to promote recycling. Final disposal volume of waste generation
decreased due to reduced production output, with intensity per unit of revenue for
Makita Corporation* falling 15.4% year on year to 0.9 tons/100 million yen and foroverseas production subsidiaries falling 20.0% to 4.0 tons/100 million yen.

overseas production subsidiaries rose 6.3% to 56.1 m3/100 million yen.

* Applicable only to the Head Office, Okazaki Plant, and Nisshin Office.

strive to reduce water usage. Although water usage decreased due toreduced production output, intensity per unit of revenue for Makita

Makita Report 2023

24

Makita’s Value Creation

Message from the Director of the Administration Department

Makita Will Quickly Return toa Sound Financial Structureand Strive to Becomea “Strong Company”
Director, Corporate Officer,
General Manager of Administration Headquarters

Yukihiro Otsu

FYE 2023 in Review
In FYE 2023, despite sluggish sales in Europe and North

increase compared to the previous year. On the other

America, strong sales in Japan and Oceania in addition tohand, operating profit decreased by 69.2% to ¥28,246

the yen’s depreciation against other currencies led tomillion, and the operating profit ratio decreased to 3.7%

a new record high ¥764,702 million in revenue, a 3.4%

from 12.4%, reflecting to the deterioration of the

Revenue Trends

Production Output by Region(Million yen)

(Million units)764,702800,000

60.00

50.05
600,000
40.00
400,000

200,000

0

2019

2020

2021

2022

2023

0
(FYE)

Japan

25

30.58
1.09

20.00

Makita Report 2023

1.87

39.59
1.42

28.72
1.07

31.48

20.13

17.78

1.34
5.12
2.90
2019

1.02
5.77
3.08
2020

EuropeNorth America

26.35
1.01

24.88
1.19
9.06

1.43

17.43

11.76

0.75
5.09
2.07
2023

3.51
2022

3.04
2021
Asia

(FYE)

Central and South America

cost-of-sales ratio due to foreign exchange rates and rising

Makita’s business model is to maintain stable invento-

raw material costs, as well higher sales, general, andries capable of providing an interruption-free productadministrative expenses. Profit attributable to owners of

supply to customers, but the sudden decline in demand

the parent was ¥11,705 million, down 81.9% comparedin FYE 2023 resulted in excess inventories. We expect

to the previous year. ROE declined to 1.5% compared todemand to remain weak for some time and, although it

9.2% in the ­previous year.

will take time to see significant reductions, Makita’s

Despite beginning with a continuation of the severe
shortages caused by the COVID-19 pandemic, FYE 2023
saw Makita starting to fulfill its mission of providing

inventories will return to an appropriate levels by the endof March 2024.
As raw material and other costs are unlikely to suddenly

a stable supply of products and services to its customers

start declining, we are striving to eliminate even the

but as inflation worsened as the situation in Ukraine

smallest amounts of waste Company-wide. Furthermore,

became more severe, demand weakened due to uncer-

we will increase business process efficiency and thereby

tainty about the future, and stagnation in customer

reduce costs by implementing digital transformation

inventories. It was thus a challenging year for profits with­initiatives focused on automating and digitizing

the need to balance price increases due to inflationinternal procedures.

against inventory reductions.

Our Fundamental Approach to Financial Management
Fundamental to Makita’s financial policy is the creation

customers while monitoring the market to improve theof a sound financial structure that ensures a solid

operating profit ratio, which should lead to ROE improve-­operating profit ratio that stays in the double digits (10%ment. We also consider maintaining regional market

or higher) and the maintenance of a business foundation

shares to be very important and will strive to nurturethat facilitates rational and flexible management

a solid understanding of every region’s situation to­decision making to improve customer convenience.

ensure that we do not lose sales.

Although profits declined significantly in FYE 2023, we
will continue to reduce inventories and pass costs on to

Human Capital Investment
Conscious of the need to build an environment in which

managers are female; and encouraging 90% or more ofdiverse human resources can play an active role regard-

eligible male employees to take ­childcare leave.

less of race or gender, Makita has established a system

I believe that it is crucial for Makita to firmly support

that allows each employee to maximize their strengths.

every employee to grow and evolve to fulfill their poten-

We will continue to implement further initiatives totial. For example, because Makita’s sales ratio favors

strengthen human capital. To measure our progress, weoverseas sales, we send young employees overseas forare working toward the following goals for Makita

training. I feel that nurturing young employees in this(non-consolidated) with the target date set at FYE 2030:

way and letting them grow through their experiences is

20% of employees sent for overseas training or temporary

characteristic of Makita. Through various initiatives, wetransfer will have worked at Makita for five years or less;are strengthening our human resource capabilities andensuring that at least 3% (at least 10 people) of

thus supporting our growth globally.

Makita Report 2023

26

Makita’s Value Creation

Message from the Director of the Administration Department

Promoting Shareholder Returns
Makita maintains a basic policy of distributing profits inglobal business development while we work to maintainline with business performance while balancing invest-

a financial structure that is resilient to changes in thement to secure sustainable growth and enhance corpo-

business environment.

rate value and ensuring financial resilience in the face ofrisk. Our conventional distribution policy has been to pay
a minimum annual dividend of ¥10 per share augmented
by an amount determined with an eye to maintaining
a consolidated dividend payout ratio of 30% or more.
However, to strengthen shareholder returns, we have

Cash Dividends Applicable to the Year per Share/
Dividend Payout Ratio(Yen)2023, we would set the minimum annual dividend at¥20 per share and the total payout ratio to 35% or more.

72
69(30.2%)(30.2%)

80

revised this policy and decided that, beginning in FYE
60

62(30.2%)

53(30.1%)

Based on this policy, the annual dividend for FYE 2023
is ¥21.

40

In addition, at the Board of Directors meeting held on
April 27, 2023, it was resolved to repurchase a maximumof 3.1 million shares at a total acquisition value of up to

21(48.7%)

20¥10 billion, ­representing 1.14% of the total number ofissued and outstanding shares.
Retained earnings will be invested in environmental

0

2019

2020

2021

2022

Note: Parentheses indicate dividend payout ratio

measures—an increasingly important area—as well as in

Focusing on Strengthening Engagement with Shareholders and Investors
Through active dialogue, we strive to deepen shareholders’and investors’ understanding of Makita’s long-term
vision and growth strategies. We work to maximize­corporate value by reflecting the feedback and requests
garnered from IR activities back to management andspreading awareness of issues our stakeholders face.
We believe that the understanding of our shareholders
and investors is crucial for us to be able to steadily work
towards Makita’s long-term development. We will continue
to work to become a “Strong Company” while earnestly
listening to our shareholders’ and investors’ feedback,and we would like to ask for your continued support.

For detailed financial information, please see Makita’s website(https://www.makita.biz/ir/finance/index.html).

27

Makita Report 2023

2023

(FYE)

Makita’s Sustainability Management

Makita Report 2023

28

Makita’s Sustainability Management

Progress of Makita’s Sustainability Management and Material Issues

Makita has been implementing sustainability initiatives in order to grow sustainably together with­society. The Sustainability Committee was established in 2021 to support these efforts, and in 2022 wewere able to newly identify important material issues requiring special priority. We will contribute to therealization of a sustainable society, including decarbonization, by further strengthening our efforts inthis area.

Basic Policy on Sustainability

1

2

3

As a global supplier of a comprehensive range of tools for creating
comfortable homes and living
environments, Makita will focus
on solving environmental problems
and other social issues throughour main business, and work toachieve a sustainable society.

Makita aims to develop in harmony
with society, by promoting corporate
ethics and compliance, respect forhuman rights, protection of the environment, quality assurance, responsible
procurement activities, etc. In particular,
we consider carbon neutrality andother environmental problems to beissues of the highest importance.

Makita will engage in highly fair
and transparent corporate­management, thereby building
strong relationships of trust withall our stakeholders.

Sustainability Promotion
Our long-term target as a “Strong Company” is to­contribute to the creation of a sustainable society andconsolidate a strong position in the industry worldwide
as a global supplier of a comprehensive range of tools
for creating comfortable homes and living environments,
including cordless power tools, battery-operated­outdoor power equipment and pneumatic tools.
The most significant initiative we have undertaken toachieve a sustainable society is the evolution to“a Supplier of a Comprehensive Range of Cordless
Products” and the promotion of rechargeable lithium-ion
batteries. By utilizing the battery charging/discharging
and motor technologies cultivated through the development of power tools, we are promoting the use ofrechargeable batteries starting with cordless outdoor
power equipment (OPE) and a wide variety of otherproducts. Moreover, through our international networkof sales and service bases, we hope to contribute to
reducing the burden on the global environment andimproving work efficiency and productivity at worksitesaround the world.
Among the social issues that we have been focusing
on for many years are those pertaining to the environment. In recent years, typhoons and other wind andflood disasters have become more frequent, and theimpact of climate change on society is growing.
Decarbonization is becoming even more critical for­companies, so in 2021 we established the Sustainability
Committee, chaired by the President, as a structure to29

Makita Report 2023

promote initiatives at Makita for carbon neutrality andother sustainability issues. The Sustainability Committee
deliberates on sustainability-related policies, targets,measures, and other matters.
In FYE 2023, the Sustainability Committee deliberated
and reported on the progress of carbon neutrality initiatives, including on GHG emission reductions, and thecommittee also leads the promotion of such initiatives
across the Company as a whole.

Sustainability Committee

Board of Directors
Submission of proposals
ReportMonitoring
Supervision

Sustainability Committee
Committee Chair: President
Vice Chairs:
General Manager of Quality Headquarters,
General Manager of Administration Headquarters
Committee members:
Department heads of major divisions

Material Issues and SDG Initiatives
Makita has identified material issues that should be prioritized from among the various social issues. Throughour business, we will contribute to the achievement of
the Sustainable Development Goals (SDGs) by working
to resolve challenges related to these issues.

Material Issue Identification Process
Priority material issues were identified in the following process.

1

2

3

Identification of Issues

Drafting

Material Issue Identification

Based on the evaluation itemsof ESG evaluation organizations, the SDGs, and dialogue
with shareholders and investors,
we identified material issues aswell as stakeholder expectations
and social trends.

Based on the identified issues,
current management concerns,
and the business environment,
the Sustainability Committee
Secretariat prepared a draft
outlining the Company’s­material issues.

Based on the draft prepared by
the secretariat, the Sustainability
Committee discussed anddecided on the final draft, which
was subsequently approved by
the Board of Directors.

Material Issues
Materiality

E

S

G

Specific Key Initiatives

Reducing
environmental
impact• Contribute to­decarbonization• Contribute to a resource-­
circulating society•Active development of cordless OPE to
replace engine-powered products•Utilization of renewable energy and energy
conservation•Promotion of the elimination of plastic•Battery recycling

Contribution
to affluent
communities
and daily lives• Improve work efficiency andthe productivity of field
operations• Support early recovery fromdisasters• Offer peace of mind during
times of disaster•A ctive development of cordless products•E xpansion of sales and service base­network with close ties to customers
and communities•E xpansion of logistics functions and­production capacity•M aintenance of a stable inventory that will
not run out in times of emergency

Strengthening
the managementbase• Exercise respect for humanrights• Provide for employee­training, safety, and health• Ensure compliance• Strengthen corporate­governance•E nsure thorough consideration of humanrights throughout the supply chain•D evelopment of human resources and­promotion of diversity and inclusion•E nsure employee safety and health•E nsure awareness of and ensure­compliance with laws and regulations• F urther improvement of the effectivenessof the Board of Directors

SDGs Contributions

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Makita’s Sustainability Management

Society (Disclosure of Human Capital, etc.)

Makita is expanding its global business and has created an environment in which diverse humanresources can play active roles regardless of race or gender. Going forward, Makita will continue toactively promote initiatives and working environments that enable diverse human resources to makethe most of their abilities while fulfilling its responsibilities as a global company by ensuring respectfor human rights and implementing CSR procurement in order to grow together with society.
Please see the Makita website (https://www.makita.biz/sustainability/social.html) for more information about our social initiatives.

Basic Approach to Human Resources
Since Makita’s expansion into the U.S. in the 1970s,
the Company has pressed forward and proactively
grown internationally. In 2005, we launched our­lithium-ion battery-powered professional-use cordlesstools ahead of the competition and, more recently, withenvironmental issues globally growing into an important
theme, we have been working towards evolving intoa supplier of a comprehensive range of cordless productsby shifting from engine-powered to battery-powered
products. This ability to flexibly respond to global­market environment changes is the source of Makita’s
growth. What supports our growth is nothing otherthan the talents of the people working at Makita.
“Don’t be angry, arrogant, panic, mope, or give up.”
These are the words of Jujiro Goto, who along withfounder Mosaburo Makita built this ­company andtransformed it into “a power tools ­corporation.”
Grounded in this personal philosophy of Mr. Goto, we
strive to provide each and every Makita employeewith the opportunity to exercise his or her talents.
Moving forward, Makita will comprehend changes
in the global market environment and strive to growwith demand. To this end, we will advance the activities of diverse human resources and globalize Makita.

Human Resource Strategies
Indicators for Human Capital• Efficiently training new human resources to becompetitive as quickly as possible• Promoting women’s advancement• Encouraging employees to take childcare leave

Efficiently Training New Human Resources to
be Competitive as Quickly as Possible
Makita is expanding its business on a global scale, andmany of its employees have experience temporarily
working or training abroad. As of March 31, 2023,
approximately 23% of employees , excluding thoseworking at the Research and Development Headquarters
or Domestic Sales Headquarters, have worked overseas
on temporary transfers. For Makita to continue to growsustainably, it is essential that newly hired humanresources (both new graduates and mid-career employees) with diverse values gain international experience
early on and receive ­training to be globally active. We
are working to achieve the target we have set of 20%
of employees sent for overseas training or temporarytransfer having worked at Makita (non-consolidated)
for five years or less by March 31, 2030.

Indicators

Percentage of employees sent
for overseas training or temporary transfer that have worked
at Makita for five years or less

FYE
2021

FYE
2022

FYE
2023

FYE
2030

17%

17%

14%

20%

Initiatives for Achievement

Mr. Jujiro Goto’s personal philosophy

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Makita Report 2023

• Proactively accepting internships and building
relationships with university laboratories to lay
the groundwork for attracting excellent humanresources• Launching short-term overseas training programs
to enable more young employees to gain
­overseas experience

Encouraging Employees to Take Childcare Leave

Reference
FYE
2021

FYE
2022

FYE
2023

Newly hired employees

267

263

289

Percentage of new hires

9.0%

8.5%

8.9%

Percentage of employees that have worked
at Makita for five years or less

26%

28%

31%

Promoting Women’s Advancement
Makita is working to create an environment that is
comfortable for women to work in and allows humanresources with diverse values to demonstrate theirabilities to the fullest. As a result, the average lengthof female employees working at Makita in Japan is
actually slightly higher than that of their male­counterparts. We have set a target for the future toincrease the ­percentage of female managers at
Makita (non-­consolidated) to at least 3% (10 or more
people) by FYE 2030, so that every female employee
can further play an active role, and we are advancing
our efforts to achieve this target.

Indicators
Percentage
of femalemanagers

FYE 2021

FYE 2022

FYE 2023

FYE 2030

0.7%(2 people)

0.7%(2 people)

1.0%(3 people)

3.0% ormore(10 or more
people)Creating a rewarding environment that allows humanresources with diverse values to balance work andfamily is vital to Makita’s continuing growth. We have
put in place a childcare leave system and a childcare
reduced-working-hours system. In recent years, thepercentage of women who use these systems hasremained high, but the percentage of men using themhas room to improve. Therefore, we have set a targetof having at least 90% of eligible male employees at
Makita (non-consolidated) use the c­ hildcare leave­system by FYE 2030 and are working towards achieving
this goal.

Indicators

Percentage of male employees
using childcare leave system

FYE
2021

FYE
2022

FYE
2023

FYE
2030

4%

8%

25%

90% ormore

Initiatives for Achievement• Making information on childcare leave available
to workplace managers to promote the creationof an environment that encourages employees touse childcare leave

ReferenceFYE 2021 FYE 2022 FYE 2023

Initiatives for Achievement• Creating systems that allow flexible work styles,
such as through the expansion of the childcare
reduced working-hours system• Actively recruiting female new graduates andmid-career hires• Encouraging women to take the exams for promotions to leadership and management positions

Percentage of female employees
using childcare leave system

94%

92%

100%

ReferenceFYE 2021

FYE 2022

FYE 2023

Average number of years
working at Makita
for women

16.8 years

17.0 years

16.8 years

Average number of years
working at Makita for men

17.2 years

16.8 years

16.3 years

Percentage of women in
leadership positions

2.1%
2.3%
2.2%
(17 people) (20 people) (19 people)

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Makita’s Sustainability Management

Society (Disclosure of Human Capital, etc.)

Human Resource Training Systems
Supporting Growth through Training and­Interviews with Supervisors
In Japan, we carry out stratified training (tailored tomatch each employee’s career stage) for new employees
all the way through mid-career management candidates.
Similarly, we maintain programs encompassing otherforms of training, including on-site factory training, as
well as correspondence training, part of which is paid
for by the Company. Some promotion and advancement evaluations entail management-related training,such as interview exercises with subordinates, to­measure and provide feedback on the individual’s
management skills, thereby helping to improve­management and leadership skills. In addition,
employees regularly set targets at the beginning ofeach fiscal year and meet with their supervisors to­discuss these results. We are committed to supporting
individual development, and supervisors provide feedback to employees as appropriate during interviews
and give them opportunities to discuss the future.
Base salaries are determined by the previous year’s
evaluations and bonuses (twice yearly) fluctuate
according to semiannual evaluations and Company
performance in order to motivate employees.

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Makita Report 2023

Environmental and safety & health education

Education concerning the Code of Ethics and compliance

Communication education (self-development courses related to languages, business skills, specialized fields, etc.)

Factory training

Overseas operation training

Training for new
employees

Rated training

2nd year of
employment
1st year of
employment

Sales training/repairs training

SupportAll

CommonEducation for trainers/
promotion exam evaluators

Training for newly appointed supervisors

Coaching training

Education by
Job Category

Career plan training

Basic

Exam for promotion

GeneralTraining for management leaders

Management

Cross-industrial
exchange training

Job Type

Human Resource Education System at the China Plant
Training for each level

GeneralemployeesNew
employeesNew
employeetrainingTeam
leader,Assistantteam
leaderAssistantmanager

Sectionmanager

SeniormanagerTraining for each roleOn-the-job
training

Legal and regulatory training
Safety training
Japanese language study sessions

Diversity & Inclusion Promotion

Education System Diagram
Exam for
Grading/ Education by Level
Promotion

Human Resource Development at the China Plant
Makita is actively engaged in human resource development at our China plant, the core of our production
base. We encourage continuous growth through proactive training at all levels, including leadership development and problem-solving training for managers. In
addition, safety training and legal and regulatory
training are provided to those above a certain rank,
and Japanese language study sessions are held for
those who plan to go to Japan for training or those
who wish to receive Japanese language training.

Makita believes the value of a company lies in beinga place where all employees, regardless of age, gender,
nationality, or disability, hold each other in mutual
respect, and are able to maximize their individual­abilities in order to fully and actively contribute.
Therefore, we strive for fairness in hiring, assignments,
promotions, and other aspects of human resource
management, eliminating distinctions based on genderor other attributes. In the Guideline to the Code of
Ethics for Makita, which serves as a code of conduct
for all Officers and employees of the Makita Group,
we are working to ensure that diverse human resources
are able to actively contribute. Our statement declaring respect for individual diversity is but one exampleof this commitment.

Securing the Safety and Healthof Employees
Ensuring the safety and health of employees is also
key to sustainable growth of a corporation. We are
implementing a variety of initiatives to ensure bothsustainable growth and the safety and health of
our employees.
Safety and Health Activities
Safety and Health Committee activities are conductedat each business site in Japan and are based on a safety plan that is developed annually. Safety patrols of
the working environment as well as hazard prediction
activities* and “Hiyari-Hatto” (near-miss) activities are
conducted at each workplace and reported to thecommittee with recommendations for improvement,
thereby creating a safer and more secure workplace.
There were 22 occupational accidents in Japan in FYE
2023, of which 3 required 4 or more days of absencefrom work. Going forward, we will continue to strive
to prevent occupational accidents by providing thorough health and safety training and taking measures
to reduce hazards in the workplace.
* Activities aimed at preventing occupational accidents by identifying
potential hazards in specific workplace tasks and identifying thetypes of hazards that could cause workplace accidents, and theneliminating unsafe employee behavior and unsafe work
environments.

Mental and Physical Health Support
In Japan, we are making Company-wide efforts toensure the mental and physical health of our employees
by conducting stress checks, interviewing employees
who work long hours, and providing in-house influenza
vaccinations. In addition, we distribute fan jackets andhave installed water dispensers at the Okazaki Plant asa measure against overheating. As for stress checks,
results are analyzed by workplace, and industrial physicians provide feedback to the person in charge ofeach department to encourage workplace improvements. We are striving to improve employee mental
health through a series of workplace improvements.

Respect for Human Rights
The Guideline to the Code of Ethics for Makita, which
outlines the conduct expected of all Group Directors
and employees, clearly recognizes “respect for humanrights” and stipulates the importance of respecting all
fundamental human rights and prohibiting discrimination and conduct that harms individual dignity. All
employees, including part-time employees, areprovided with information and training about the
Guideline to the Code of Ethics for Makita once a year
without fail. This also covers overseas subsidiaries andwe thoroughly emphasize respect for human rights
across the entire Group. Furthermore, since we believethat it is important to fulfill our social responsibility forrecognizing human rights not just ourselves but
alongside all of the businesses in our supply chain, theGuideline to the Code of Ethics for Makita also stipulates that fulfillment of social responsibility andrespect for human rights (including working to­eliminate child labor and forced labor) are selection
criteria for business partners.

CSR Procurement
Makita is striving Company-wide to deliver safe,
high-quality products to our customers to ensure thatthey can enjoy peace of mind when using our tools. In
working to achieve this objective, we consider it
important not just to comply with relevant laws andregulations but to conduct transactions with business
partners fairly, equitably, transparently, and honestly
and to strive to build relationships with them as­partners as well as to promote procurement activities
focusing on social concerns, including the environment, human rights, corruption prevention, and­proper hiring practices. We stipulate this in our MasterTransaction Agreement and Basic Policy on Procurement.
One pillar of this effort is our pursuit of responsible
procurement activities, including conducting annual
surveys of the environmental protection activities ofour business partners to, for example, monitor­environmental systems acquisition.

Basic Policy on Procurement
1. Compliance with laws and regulations andsocial codes
2. Consideration given to reducing environmental impacts
3. Provision of fair and equitable transaction
opportunities
4. Coexistence and co-prosperity based on mutual trust

Please see the Company website (https://www.makita.biz/sustainability/documents/procurementpolicy.pdf) for details.

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Makita’s Sustainability Management

Environment

We promote environmental management with the aim of achieving both environmental protection
and sustainable business growth. We have been actively engaged in environmental protection activities based on the principles and aims set forth in our Environmental Policy, established in 1998. Since
2022, we have been further strengthening our efforts by positioning contributing to decarbonization and a resource-circulating society as our material issues.
For more information on our environmental initiatives, please visit the Makita website and read the Environmental Report(https://www.makita.biz/sustainability/environment.html).

Environmental Vision
The “Go Green” slogan symbolizes Makita’s commitment to continually providing new value
as a comprehensive international supplier of tools. We hope to always remain as a company
that maintains a steady eye on society, challenging ourselves to create a “sustainable­recycling-oriented society” that harmonizes the environment with the economy.

Environmental Policy
Basic Principles
As a global supplier of a comprehensive
range of tools for creating comfortable
homes and living environments, Makita isaiming to conduct a wide range of environmental protection activities, in order tocontribute to having sustainable society
and conservation of biodiversity.

Policies
1. Enforcement of environmental administrative
structure
2. Continuous improvement
and pollution prevention
3. Compliance with applicablelaws and regulations

4. Establishment and review
of objectives and aims
5. Reduction of environmental
burden6. Disclosure

Please see the Makita website for the full text of our policies (https://www.makita.biz/sustainability/policy.html).

Environmental Management
Makita has established and run its own environmental
management system since 1998. For the purpose ofleveraging that system as a tool for mitigating environmental burdens, our Head Office and Okazaki
Plant first received ISO 14001 certification in 2007.
Since then, our Nisshin Office and all of our overseas
production bases have received the certification andare now operating environmental management systems.
We promote the protection of the environment at
all of the business bases listed here and carry out
activities, such as Internal Environmental Audits andenvironmental education, based on the requirementsof the certification.

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Makita Report 2023

ISO 14001 Certifications (As of April 2023)
Japan

Aichi
Prefecture
China

Overseas
production
bases

Head Office, Okazaki Plant, Nisshin Office
Makita (China) Co., Ltd.
Makita (Kunshan) Co., Ltd.

Thailand

Makita Manufacturing (Thailand) Co., Ltd.

U.S.

Makita Corporation of America

Brazil

Makita do Brasil Ferramentas
Elétricas Ltda.

U.K.

Makita Manufacturing Europe Ltd.

Germany

Makita Engineering Germany GmbH

Romania

SC Makita EU SRLContributions to Decarbonization
Toward the realization of decarbonization, we aredeveloping products that contribute to solving­environmental problems and promoting environmentally friendly business activities. In addition, we have
set reduction targets for greenhouse gas (GHG)­emissions reduction. Please see page 44 for details.

GHG Emissions (Scope 1, 2, 3) (FYE 2023)
Scope 1 

5.62
million t-CO₂(0.4%)

Scope 2 

(0.8%)

Scope 3 

(98.8%)

Category 1 (42.1%)

Category 4 (15.1%)

Category 11  (38.6%)C ategories 2, 3, 5,
6, 7, 12

(3.0%)

Notes: 1. Of the 15 categories in Scope 3, categories 8, 9, 10, 13, 14, and 15 havebeen excluded from calculation.
2. The figures in parentheses above are percentages of the total of Scope 1
through 3, with 5.62 million t-CO2 as the denominator.

Initiatives in Our Business Activities

Energy Conservation

To reduce GHG emissions in our business activities, weare actively utilizing renewable energy and conserving
energy where possible. In addition, to raise environmental awareness among employees, we conduct
educational activities, including distributing energy-­saving promotional materials to employees and making
regular inspections to check energy-saving responses
undertaken at offices and plants.

Our efforts toward reducing GHG emissions include
pursuing efficiency gains for energy-consuming
equipment in our offices by, for example, installing
LED lighting and high-efficiency equipment (AC units,compressors, manufacturing machinery, etc.). In FYE
2023, the total annual power consumption of our
Head Office, Okazaki Plant, and Nisshin Officedecreased by 209,252 kWh compared to the previous
year due to our switching to LED tubes, and improving
AC units and compressor efficiency.

Utilization of Renewable Energy
We are working to reduce GHG emissions throughsuch measures as installing photovoltaic panels.
Overseas, photovoltaic panels have been installed atseveral locations. In FYE 2023, photovoltaic panels
were installed at production sites in Thailand and sales
sites in Austria and Taiwan. Photovoltaic panels werealso installed at a newly established sales office inJapan during FYE 2023. We plan to continue installingphotovoltaic panels at our facilities in Japan and overseas
and to switch to renewable energy sources for electricity used at our offices and other facilities. In addition to photovoltaic panels, some sites in Germany
and other countries have installed geothermal heating and cooling systems and are working to reduce
GHG emissions through the use of renewable energy.

Using Environmentally Friendly Materials for
Products and Packaging
To contribute to carbon neutrality, Makita is promoting
initiatives to use biomass materials in the manufactureof a portion of its products. Furthermore, in FYE 2022
we began switching from conventional to biomass
plastic bags in our product packaging.
To help reduce waste plastic across society, in addition
to biomass materials, we are considering introducing
recycled resin materials and plan to start using bags
and cases made from these materials in FYE 2024.

Motor housing cover

ThailandAustria

TaiwanGA9060 series
Biomass materials are used in the motor
housing cover

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Makita’s Sustainability Management

Environment

Contributions through Our Products
Since Makita brought to market the world’s first­professional-use power tools employing lithium-ion
batteries in 2005, we have been expanding our lineupof cordless products and, in recent years, actively
replacing engine-powered products with cordlessmodels, especially in the area of cordless outdoor
power equipment (OPE), where engine-poweris mainstream.
Reflecting increased awareness of such environmental issues as climate change, the impact of
exhaust from engine-powered products has become

CE001G cordless power cutter
Cutting speed faster than a 75.6 mL engine and equipped withlow-vibration springs to reduce oscillationa major issue. Because Makita’s cordless OPE, whichemits no exhaust gas during use, contributes significantly to the realization of decarbonization, we arefocusing on this as our next pillar of business in addition
to power tools. To further this goal, we terminated the
production of engine-powered products.
We will continue to focus our management resourceson the development, production, sale, and service ofcordless products and accelerate the transition fromengine-powered to cordless products with equivalent
performance, thereby contributing to the realizationof decarbonization.

UB002C battery-powered backpack blower
Longer usage time and stronger blowing power thana 50 mL engine

Contributions to a Resource-Circulating Society
Makita is committed to using limited resources effectively and contributing to the realization ofa resource-circulating society.

Battery Recycling
As “a Supplier of a Comprehensive Range of Cordless
Products” and as a company that supplies a large­volume of batteries, we believe that, for the sake ofenvironmental protection and the effective utilizationof resources, collecting used batteries is a crucial task.
By building and implementing collection systems ina host of countries and regions in accordance withlocal laws and regulations, we are working to promoteresource recycling.

Battery Collection in Japan

Users

Depositused batteries

Makitacollection
point

Recycler
JBRC
collects
batteries

Retailers

Initiatives in Japan

Initiatives in Germany

We are a member of the Japan Portable Rechargeable
Battery Recycling Center (JBRC) and, based on the Act
on the Promotion of Effective Utilization of Resources,
have registered our Head Office and domestic sales
offices as collection points.

In Germany, battery manufacturers and the German
Electro and Digital Industry Association (ZVEI) established the non-profit Stiftung GRS Batterien in 1998,
which operates the joint battery collection systemused by Makita.

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Makita Report 2023

In December 2021, Stiftung GRS Batterien and
Makita Werkzeug GmbH (Germany) signed an industry
agreement in the power tools sector. The two are
working to increase the collection rate of used­lithium-ion batteries and promote recycling by installing collection boxes exclusively for lithium-ion batteries
at home centers and other power tools retailers.

Switch from plastic to paper bags

Hook and bit sets

Promoting the Elimination of Plastic
Due to concern about global environmental pollution
in the form of plastic waste in the oceans and amidsocial efforts to reduce the consumption of single-use
plastics, we are working to cut back on the volume ofsingle-use plastics in our product packaging andthereby contribute to the realization of a sustainable
society and the preservation of biodiversity. In addition to simplifying packaging, from FYE 2021, we havebeen reducing the use of plastic bags by devising­better packaging materials. We plan to further­promote the elimination of plastic in the future.

Environmentally Friendly Design
Our approach to environmentally friendly products
began with an assessment of our products in 1992. In
1993, we created Makita’s Global Environment Charter,and the active development of environmentallyfriendly products began.
When designing new products, we focus on improving
energy efficiency, reducing weight, and extending­service life. We also check to see if the materials­utilized in each part of our products are recyclable
and, more often than required by the specifications of
our internal regulations, opt for materials that areenvironmentally friendly. In this way, we are continuously
developing tools that can be recycled.

Suspension of plastic bags (devising internal materials)

Grip with plastic bag

Elimination of plastic bags bydevising better internal
packing materials

TopicsWe are actively involved in reducing our environmental impact and arealso working with local authorities. We plan to reform and improve thework style of the forestry industry through collaboration between local
authorities, which aim for forestry that does not bring excess CO2 and isfriendly to the forest environment, and Makita, which aims to replaceengine-powered units with cordless products. By working together withthe public and private sectors to solve social issues, we will steadily
advance our efforts to realize a sustainable society.

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Makita’s Sustainability Management

Environment

Initiatives in Line with the
TCFD Recommendations

As the effects of climate change on society, such as
high winds and flooding, increase in frequency andseverity, the role of companies in achieving­decarbonization is becoming more important.
Accordingly, we view climate change issues asa high-priority management challenge.
To this end, we are focusing on OPE that does notemit exhaust gas during use and are actively working
to reduce GHG emissions by striving to reach thegoal of virtually eliminating GHG emissions from ouroperations by fiscal 2040 (FYE 2041).
Recognizing the importance of these efforts aswell as engaging in dialogue with our stakeholders
regarding the impact of climate-related risks andopportunities on our business and other activities,
we endorsed the ­recommendations of the Task Forceon Climate-Related Financial Disclosures (TCFD)
in 2021.

Governance
Chaired by the President, the Sustainability Committee,
which promotes Company-wide efforts to address­sustainability issues through business activities, wasestablished in 2021.
The committee considers climate change to be one of
the most important sustainability issues, and deliberates
on policies, measures, and plans to reduce GHG emissions.
The Sustainability Committee reports and submits
proposals on important matters to the Board of
Directors, which deliberates on these matters and makes
decisions in the course of monitoring and overseeing
the Company’s climate-related risks and opportunities.

Board of Directors
Monitoring and supervision of climate-related risks
and opportunities

Submission of proposals
ReportMonitoring
Supervision

Sustainability Committee
Committee Chair: President
Vice Chairs: General Manager of Quality Headquarters,
General Manager of Administration Headquarters
Committee members: Department heads of major divisions

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Makita Report 2023

Strategy
1. Determining Risks and Opportunities
In identifying climate-related risks and opportunities that could affect our business, we have used climate change­scenarios from the International Energy Agency (IEA), the Intergovernmental Panel on Climate Change (IPCC), andother organizations to organize our views into (1) a 1.5°C to 2°C worldview in which decarbonization progresses and(2) a 3°C to 4°C worldview in which warming proceeds as it is now. The following is a summary of the results.

Global decarbonization• Tighter GHG emissions regulations, higher carbon prices

1.5–2°C• Energy conservation and energy generation in buildings, expansion ofsolar panels, and widespread use of EV charging facilities• Shift from fossil fuel to electric engines

Major drivers
affecting Makita’sbusiness

Both scenarios• Expansion of building and construction market

World continues on current path
• Increasing frequency and severity of wind and flood disasters

3–4°C• Increased preparedness and disaster awareness for wind and flood disasters• Decreased productivity of outdoor labor due to increased heat stress

Based on these worldviews, we have identified our climate-related risks and opportunities and qualitatively assessed them.
Risks
Type

Category
Large

Small

Risk
Increased operating costs based on own GHG emissions

Rising carbon price/energy conservation and
Policies and low-carbon regulations
regulations

Increased procurement costs of raw materials, energy, etc.
Increased capital expenditures to enhance energy efficiency
Increased renewable energy procurement costs

Transition

Technology

Battery regulations

Increased battery procurement costs

Product technology
developmentcompetition

Increased development costs for technologies and products with­superior environmental performance (including portability and­operational efficiency)

Competition to develop
next-generation battery
technology

Increased development costs for next-generation batteries with­superior capacity, voltage, life, safety, etc.

Relevant
PeriodPossibility

Short tomediumterm
Short term

Large

Medium tolong term

Short tomediumterm

Large

Increased procurement costs due to increased battery demandMarketReputation

Physical

AcuteIncreased procurement costs due to increased demand for
Changes in market prices ­semiconductors

Increased disclosure
requests
Increased frequency andseverity of wind andflood disasters

Short term
Large

Increased transportation costs due to decarbonizationof transportation

Short tomediumterm

Reputational damage due to inferiority of information disclosure­compared to other companies

Short term

MediumShort term

MediumPhysical damage to our offices and facilities
Losses due to business interruption
Losses due to supply chain disruptions

Note: Risk onset timing: Short-term: up to 3 years; Medium-term: over 3 years to 10 years; Long-term: over 10 years

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Makita’s Sustainability Management

Environment

Opportunities
Category

Type

Large
Energysources

Products
and services
Transition

MarketPhysicalResilience

Small

Opportunity

Relevant Period Possibility

Increased carbon prices

Decrease operating costs by reducing GHG emissions tobecome carbon neutral

Short tomedium term

Product technology­development competition

Differentiation from competitors’ products through the­development of products with superior environmental­performance (including portability and work efficiency)

Short term

Competition to develop
next-generation battery
technology

Differentiation from competitors’ products through the­development of next-generation batteries with superior­performance

Medium tolong term

Energy conservation andlow-carbon regulations

Market expansion and product demand increase due to a shift
from engine-powered to cordless products

Changes in the building
and construction market

Increase in demand for products associated with ZEB*1/ZEH*2­conversion of buildings, installation of solar power generationequipment, and EV charging facilities, etc.

Increased disclosure
requests

Improve reputation through enhanced disclosure information

Rising temperatures,climate change, andextreme weather

Increase in demand for products in line with increase in DIY
demand due to longer time spent at home

Short tomedium term

Increased frequency andseverity of wind and flood
disasters

Expansion of the disaster readiness market, increase in productdemand, and contribution to recovery and reconstruction in
the affected areas

Short term

Rising temperatures

Increase in demand for products to improve working­conditions in hot environments

Short tomedium term

Large

Large

Large
Short term
Medium
Large

Large

Note: Opportunity onset timing: Short-term: up to 3 years; Medium-term: over 3 years to 10 years; Long-term: over 10 years*1 Net Zero Energy Building   *2 Net Zero Energy House

2. Scenario Analysis and Setting Themes
We conducted scenario analyses on the following four themes that we rated as “highly important” and evaluatedtheir probable impact on our business, strategy, and finances through 2050, taking into account the effect on ourbusiness operations, relevance to our business strategy, and the level of interest of our stakeholders.
3. Results of Scenario Analyses
Theme 1 (Opportunities): Change in demand for cordless OPE due to decarbonization of OPE
Opportunities
under theTheme

• In the OPE sector, emission regulations are being introduced and strengthened.
• Demand for cordless OPE is expected to grow as the shift from engine-powered to cordless OPE progresses against a backdropof further tightening regulations and changing consumer preferences towards decarbonization.

AnalysisAssumptions• Baseline (as-is scenario) for market expansion calculated based on market forecast information for the OPE sector• For the OPE sector, data for the below 2°C scenario is based on IEA scenario data* assuming a shift to EVs in the automobile sector

Analysis Results• The market for cordless OPE is expected to expand under the as-is scenario due to the expansion of the OPE market, but underthe below 2°C scenario, we expect the market to expand significantly due to the shift from engine-powered to cordless systems.
• We expect sales to grow at the same rate as the market growth, and, if our market share can be increased, we can expect further
sales growth.

FutureOpportunity
Acquisition
Measures• Actively develop cordless OPE that can replace engine-powered OPE• Strengthen sales and service capabilities by expanding the sales and service network• Expand logistics and production capacity in anticipation of increased OPE sales and products handled* Reference: IEA’s “Global EV Outlook 2021.” It is assumed that the shift from engine-powered to rechargeable systems in the OPE sector will progress at a slower rate than theshift to EVs in the automobile sector.

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Makita Report 2023

Theme 2 (Opportunities): Change in demand for power tools as the building and construction market expands
Opportunities
under theTheme

• Expansion in the global building and construction market is expected to increase demand for power tools.
• The demand for power tools is expected to increase as more energy-saving (i.e., renovation of existing buildings) and energy-­
creating (i.e., installation of photovoltaic panels) construction approaches are taken to further decarbonization, and as the­number of EV recharging facilities increases.

AnalysisAssumptions• Increased demand for power tools is anticipated due to a growing volume of building and construction work globally• Baseline (as-is scenario) for power tools sales calculated based on statistics on the size of the building and construction market• The amount of energy-saving and energy-creating construction work in buildings and the installation of EV charging facilities topromote decarbonization is based on data from the building and construction industry and IEA scenario data (below 2°C scenario)

Analysis Results• Sales of power tools are expected to grow under the as-is scenario, but are expected to expand significantly under the below
2°C scenario due to an increase in the amount of energy-saving and energy-creating construction work and installation of EV
charging facilities.
• Among them, cordless power tools with excellent work efficiency are expected to see increased use in the building and­construction market.

FutureOpportunity
Acquisition
Measures• Develop power tools based on market trends, in particular, proactively develop cordless power tools that contribute to reducing
environmental impact by improving work efficiency• Strengthen sales and service capabilities by expanding the sales and service network• Expand logistics functions and production capacity in anticipation of sales growth

Theme 3 (Risks): R isks associated with lithium-ion batteries (procurement costs, rise of next-generation batteries withhigher performance)
Risks under
the Theme• The growing demand for lithium-ion batteries (LiB) in the automotive and energy industries is expected to lead to fluctuations in
LiB procurement costs.
• The competitive environment is expected to change with the emergence of high-performance next-generation batteries.

AnalysisAssumptions• Baseline (as-is scenario) LiB unit price calculated with reference to the market forecast information on LiB unit prices• Based on historical data on LiB raw material costs (lithium, nickel, and cobalt), set raw material costs that will soar if demand for
LiB increases (below 2°C scenario)

Analysis Results• Under both the as-is scenario and the below 2°C scenario, LiB unit prices are expected to decline over the medium to long termagainst a backdrop of planned production increases by battery and materials manufacturers. If the supply-demand balance of
LiB raw materials is disrupted by greater than expected demand for EVs and storage batteries, etc., LiB unit prices may soar, but
the long-term impact is expected to be negligible.
• Although it is difficult to predict the market for next-generation batteries, we expect the competitive environment to changeover the medium to long term as next-generation batteries become more widespread and emerge in our product areas as aresult of the traction of the EV market.

• Build long-term relationships with battery suppliers
Future Risk
Countermeasures • Pursue research and development for the launch of products using next-generation batteries

Theme 4 (Risks): Risk of increased operating costs due to higher carbon prices
Risks under
the Theme• Operating costs are expected to increase due to the introduction of carbon pricing such as carbon taxes and emissions trading
schemes as well as increases in carbon prices.

AnalysisAssumptions• Establish long-term GHG emission reduction pathways based on GHG emission reduction plans toward carbon neutrality and
IEA scenario data, etc.
• Establish costs for GHG emission reduction measures, etc.
• Estimate future carbon prices based on IEA scenario data and compare to the above measure costs

Analysis Results• The cost of actively reducing GHG emissions, including the use of renewable energy, will be less expensive than the carbon pricebased on GHG emissions if GHG emission reduction measures are not actively pursued.

• Procure renewable energy electricity, and introduce and expand solar power generation for own consumption
Future Risk
• Further improve energy efficiency of business activities
Countermeasures• Promote commercial-use EVs

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Makita’s Sustainability Management

Environment

4. Future Policies and Initiatives
We have qualitatively and quantitatively assessed and understood the impact of climate change on our business
operations, strategy, and finances and have confirmed not only that our products are financially resilient to climatechange as they contribute to climate change mitigation and adaptation but that our business strategy is feasible
and sustainable.
Among our products, we believe that our cordless products, which feature safety, convenience, improved comfort,and zero emissions during use, will play a particularly important role in contributing to climate change mitigation andadaptation. In addition, although not included in the previous section (3. Results of scenario analyses), under the as-is
scenario, in which wind and flood disasters are expected to become more frequent and severe, it is important toensure a prompt and stable supply of cordless products so that recovery and reconstruction efforts in the affectedareas are supported, and we will continue to build a system to achieve this. We will continue to contribute to society
and work to achieve sustainable growth by promoting initiatives to become “a Supplier of a Comprehensive Range of
Cordless Products.”
5. Plans for the Transition to Decarbonization
In 2005, we were the first in the industry to market professional cordless power tools that use lithium-ion batteries,
and we have since been strategically transitioning from traditional products to cordless products. In addition, theCompany has set a goal of reducing GHG emissions from its operations to virtually zero by fiscal 2040 (FYE 2041), andis actively working toward this end.
We are aiming to ensure and improve the effectiveness of these mitigation measures. We will set relevant indicators and targets, and we will supervise our performance, progress and achievement under them in line with climatechange governance. In addition, the transition plan will be regularly reviewed and updated. We will also strategicallywork to capture and maximize opportunities for decarbonization in our transition plan.

Overview of the Transition Plan to Achieve the 1.5°C Target

Climate Change
Mitigation

Reducing GHG
Emissions• Achieve virtually zero GHG emissions (Scope 1 and 2) by fiscal 2040 (FYE 2041)• Medium-term target: 50% reduction from fiscal 2020 (FYE 2021) levels by fiscal 2030 (FYE 2031)

Elimination of EnginePowered Equipment• Increase the OPE electrification ratio (fiscal 2022 (FYE 2023) result: 91.9%)

Capture and Maximize Opportunities

Strategic implementation of the following measures based on the results of scenario analyses• Active development of cordless products (including cordless power tools and OPE)
• Expansion of sales and service network• Expansion of logistics functions and production capacity in anticipation of sales growth

Risk Management
We hold annual Disclosure Committee meetings to identify and scrutinize risks in our business activities as well as toevaluate and manage risks related to climate change. The details of climate change risks and opportunities areassessed and managed under the Sustainability Committee.
Recognizing that climate change is one of the most important external environmental risks we face, the Board of
Directors discusses the impact of climate change on management and determines management strategies and­measures that will contribute to decarbonization.
We will further strengthen our climate change response by solidifying our systems and operations for managing
these climate-related risks.

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Makita Report 2023

Indicators and Targets
Targets related to GHG emissions
The Makita Group has set goals to reduce GHG emissions from its own business activities (Scope 1 and 2) to virtuallyzero by fiscal 2040 (FYE 2041) and from its entire supply chain (Scope 3) to virtually zero by fiscal 2050 (FYE 2051).
The ­mid-term target for Scope 1 and 2 is to halve the fiscal 2020 (FYE 2021) level by fiscal 2030 (FYE 2031).
Targets and results related to GHG emissions (t-CO₂)
Fiscal 2020
(FYE 2021) Results

Fiscal 2030
(FYE 2031) Targets

Fiscal 2040
(FYE 2041) Targets

Scope 1, 2

89,673

44,836

Virtually zero

Scope 3

6,006,569——

Fiscal 2050
(FYE 2051) Targets

Virtually zeroNote: Please see page 36 for GHG emissions in fiscal 2022 (FYE 2023).

To achieve the above goals, we will steadily implement initiatives to reduce GHG emissions through the use of­renewable energy and other means.
Indicators for the electrification of OPE
As described in the scenario analysis for “Theme 1 (Opportunities): Change in demand for cordless OPE due to­decarbonization of OPE,” the transition from engine-powered to cordless OPE is progressing in line with progress
toward a decarbonized society. We have set the electrification (elimination of engine-powered equipment) ratio as
an indicator and are striving to increase this ratio. In addition, Makita has discontinued production of all
engine-powered products, ­including OPE.
Indicators and results related to the electrification ratio* of OPE
Fiscal 2019
(FYE 2020) Results
86.1%

Fiscal 2020
(FYE 2021) Results
88.5%

Fiscal 2021
(FYE 2022) Results
90.9%

Fiscal 2022
(FYE 2023) Results
91.9%* Based on sales volume, including both AC products with power cords and cordless products

We will continue to promote the proactive development of cordless OPE that can replace engine-powered OPE inorder to contribute to solving environmental problems, particularly climate change issues.

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Makita’s Sustainability Management

Corporate Governance

Makita strives to strengthen and enhance corporate governance in order to increase corporate value
and earn the trust of shareholders and other stakeholders.
For more detailed information on corporate governance, please see the relevant section and the Corporate Governance Report on
Makita’s website (https://www.makita.biz/sustainability/governance.html).

Basic Philosophy on Corporate Governance
Makita believes that the most important issue is to achieve unending development together with its various stakeholders. In order to achieve this, we have established a Management Policy/Quality Policy and are working to strengthen
and enhance our corporate governance. From this perspective, we will work to maintain and improve the fairness andtransparency of our management by striving to enhance management transparency and management checking functions as well as to proactively and promptly disclose information.

Steps Taken to Strengthen Corporate Governance2005 June2019 June
Appointed Outside Directors

2006

June
Discontinued retirement allowance plan for
Directors and Audit & Supervisory
Board Members

2009

June
Introduced the Corporate Officer system

2011

June
Appointed two non-Japanese Corporate Officers

2015

June
• Increased the number of Outside Directors• Introduced stock-compensation-type stock option

Introduced a restricted share compensation
system2020

DecemberEstablished the Nomination and Compensation
Committee

2021

June
• Transitioned to a Company with an Audit &Supervisory Committee• Increased the number and ratio of Outside
Directors( One third of Directors are Outside Directors)

2023

June
Appointed a female Outside Director

(Discontinued upon the introduction of a restricted sharecompensation system in June 2019)

Schematic Diagram of Makita’s Corporate Governance Structure (as of June 28, 2023)
General Meeting of Shareholders
Appointment/Dismissal

Nomination
andCompensation
Committee

Consultation/
Delegation
AdviceMonitoring/
Supervision

Appointment/Dismissal

Board ofDirectors
Directors(Excluding Directors who are Audit &Supervisory Committee Members)

Submissionof Proposals/
ReportAudit/
Supervision

Appointment/Dismissal/
Supervision

President(Promoting Carbon Neutrality, etc.)

Corporate
Officers

Corporate
Officer, General
Manager of
Administration
Headquarters

Audit & Supervisory
Committee

Collaboration

Directors who are Audit &Supervisory Committee Members
Support

Audit

Audit & Supervisory Committee
Staff Office

ChairmanSustainability Committee

Appointment/
Dismissal

ReportDisclosure Committee

ReportInternal Audit Division

Audit
Accounting Audit

Corporate Divisions
Group Companies

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Makita Report 2023

Internal Control Audit

Accounting
AuditorPrincipal Organizational Structures
Chairman/Committee Chairs

Internal
Directors

Members

OutsideDirectors

Meetings Heldin FYE 2023

Board of Directors

Masahiko Goto (Chairman, Representative
Director)

15

10

5

12

Nomination andCompensation Committee

Masahiro Sugino (Outside Director)

5

2

3

4

Audit & Supervisory
Committee

Mitsuhiko Wakayama (Director, Standing Audit &Supervisory Committee Member)

4

1

3

13

Proportion of Outside Directors in Each Organization
Internal

Outside

Men

Women

Board of Directors

33% (7%)

Nomination andCompensation
Committee

Audit & Supervisory
Committee

60%

75% (25%)

Note: The numbers in parentheses above show the proportion of women.

Skills Matrix
Name

Nomination
andIndependent
Corporate
Compensation
management
Committee

Expertise
Overseas
experience

Sales/
marketing

Production/IT/
Development procurement/ Sustainability
digitalization
quality

Finance &accounting

Legalaffairs

Masahiko
Goto
Munetoshi
Goto
Shinichiro
TomitaTetsuhisa
KanekoTomoyuki
Ota
TakashiTsuchiya
Masaki
YoshidaTakashi
Omote
Yukihiro
Otsu
Masahiro
SuginoCommittee
Chair

Takahiro
Iwase
Mitsuhiko
Wakayama
Shoji
Inoue
Koji
Nishikawa
Ayumi
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Makita’s Sustainability Management

Corporate Governance

Overview of the
Corporate Governance Structure
Board of Directors
A regular meeting of the Board of Directors shall be held
once a month and extraordinary meetings shall be held
whenever necessary. The Board of Directors, as the­decision-making body for management, decides onimportant management matters, including decisions on
management policies and business plans, the conclusionof important agreements, and the establishment of­subsidiaries in accordance with the Regulations of theBoard of Directors, in addition to matters stipulated bylaws and regulations and the Articles of Incorporation,and supervises the execution of operations. Outside
Directors are appointed from among those who havea wealth of experience and broad insight in corporate
management and those who have a wealth of experience and insight in various fields, including finance,accounting and legal affairs, and are responsible forstrengthening corporate governance by providing­opinions as appropriate from an independent perspective with no risk of conflict of interest with generalshareholders. Additionally, Makita has hired several
Directors with abundant business experience at overseas
bases, which adds diversity to the Company.
Nomination and Compensation Committee
In consultation with the Board of Directors, theNomination and Compensation Committee carries out
tasks such as deliberating and advising on policies­concerning the nomination of Representative Directors
and Directors,* matters concerning the appointment ofRepresentative Directors and Directors,* matters­concerning the succession plan for the President,­policies concerning decisions on the details of individualcompensation for the Directors,* and, as delegated by
the Board of Directors, makes decisions on the details of
individual compensation for the Directors.** And etc., excluding Directors who are Audit & Supervisory Committee Members

Main Deliberations in FYE 2023

Nomination and compensation policies for Officers
Determination of individual compensation
Officer appointments
Succession planning for the President

Audit & Supervisory Committee
The Audit & Supervisory Committee meets oncea month and also holds extraordinary meetings as

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Makita Report 2023

­ ecessary. The Audit & Supervisory Committee auditsnand supervises the execution of duties by the Directors,
and investigates the status of business and assets byattending important meetings and hearing reports inaccordance with its stipulated audit policies and divisionof duties. The Audit & Supervisory Committee also
appropriately exercises its right to express opinions on
the nomination and compensation of Directors­(excluding Directors who are Audit & Supervisory
Committee Members). With the objective of ensuring
the smooth execution of audits by the Audit &Supervisory Committee, Makita established the Audit &Supervisory Committee Staff Office, comprising dedicatedsupport personnel.
In order to strengthen the effectiveness of audit andsupervisory functions, one standing Audit & Supervisory
Committee Member has been appointed. Three Outside
Directors who are members of the Audit & Supervisory
Committee have been appointed, one of whom is anattorney-at-law and the other two are certified public
accountants who have many years of experience and­expertise in their respective fields. Makita considers
these individuals capable of performing highly­specialized audits from an independent perspective.
Corporate Officers
We have introduced a Corporate Officer system to facilitate the proper implementation of the Group’s strategy
and strengthen our business execution structure, andwe are striving to engage in flexible and efficient­business operations. As of July 2023, Makita has 17
Corporate Officers, and three of these Corporate
Officers are non-Japanese.
Three-Way Auditing System
The Audit & Supervisory Committee, the Internal Audit
Division, and the Accounting Auditor collaborate,exchanging information and opinions as necessary. The
Audit & Supervisory Committee meets regularly with the
Accounting Auditor to receive reports and explanationsof audits and review results, as well as to exchange information and opinions. In addition, the Audit & Supervisory
Committee itself conducts audits of the Group, including
its subsidiaries, cooperating with their internal audit
divisions. Along with auditing results, the Audit &Supervisory Committee receives reports from the internal
audit divisions on the status of the establishment ofinternal control systems throughout the Company andexchanges information and opinions with said divisions.

Director Selection Policy andDecision-Making Processes
PolicyThe Board of Directors as a whole possesses a good balance of knowledge, experience, and ability, and strives
to maintain both diversity and an appropriate size aswell as to keep the ratio of Outside Directors at morethan one-third.

Internal Directors*

Appoint persons with the ability to formulate
and execute management strategies based on
their own experience and insight, including a
wealth of experience in the Company’s operations

Outside Directors*

Appoint persons with extensive experience andbroad insight in corporate management

Directors who
are Audit &Supervisory
Committee
Members

Appoint persons with internal and external work
experience and a wealth of experience andinsight in various fields, including finance,accounting and legal affairs, ensuring that atleast one of them possesses the required wealthof experience and insight in each field, i.e.,
finance, accounting and other fields* Excluding Directors who are Audit & Supervisory Committee Members

Director Compensation
Compensation for Directors(Excluding Directors who are Audit & Supervisory
Committee Members)
The Board of Directors, after consultation with andreceiving advice from the Nomination and Compensation
Committee, determines the decision-making policy on
the details of individual compensation for Directors(excluding Directors who are Audit & Supervisory
Committee Members). Compensation for Directors(excluding Directors who are Audit & Supervisory
Committee Members) consists of monthly compensation,bonuses, and restricted share compensation. Intended
to incentivize Directors, the latter two forms of compensation comprise a consolidated performance-linked
bonus aimed at motivating efforts to improve businessperformance and a restricted share compensation­system aimed at motivating efforts to increase sharevalue and enhance corporate value.
Monthly
compensation

Bonuses*

Restricted sharecompensation** Not applicable to Outside Directors

Process
Directors(excluding Directors who
are Audit & Supervisory
Committee Members)

Candidates are determined by the Boardof Directors, reflecting advice on candidates compiled by the Nomination andCompensation Committee, and appointed
at the General Meeting of Shareholders

Directors who are
Audit & Supervisory
Committee Members

Candidates are determined by the Boardof Directors with the consent of the Audit& Supervisory Committee and appointed
at the General Meeting of Shareholders

Determination

Monthly
compensation

Evaluation of Effectiveness of
the Board of Directors
Makita conducts an annual self-evaluation questionnaire
for each Director on the effectiveness of the Board of
Directors. The results of analyzing the FYE 2023 effectiveness evaluation indicated that the Board of Directors
generally functions appropriately from the perspectiveof its composition, operation, supervisory function, andresponse to shareholders and stakeholders, and that theeffectiveness of Makita’s Board of Directors is ensured.
On the other hand, it was thought that there is roomfor further improvement with regard to the advance­distribution (delivery) of deliberation materials and advance
explanations for meetings of the Board of Directors, so
we worked on the further improvement of effectivenessby bringing forward the distribution of deliberationmaterials and expanding advance explanations by thesecretariat of the Board of Directors to Outside Directors.

The Nomination and Compensation
Committee is delegated through a resolutionof the Board of Directors to determine theamount of monthly compensation for each
Director within the limit on compensation
resolved by the General Meeting of
Shareholders based on business results, position,
employee salary increases, and other factors.

TotalamountAs is the case for dividends from surplus, bonuses
are based on profit attributable to owners of
the parent per share (basic) after adjusting forspecial factors, and the Board of Directors
determines the total amount of bonuses basedon a certain formula following consultations
and advice from the Nomination andCompensation Committee, submitting theamount for resolution at the General Meetingof Shareholders.

Individual

The Nomination and Compensation
Committee is delegated through a resolutionof the Board of Directors to determine the­allocation of bonuses to Directors based on
performance, position, and other factors.

Bonuses

Restricted sharecompensation

After consulting and receiving advice from theNomination and Compensation Committee,
the Board of Directors determines the­allocation of restricted share compensation to
Directors based on position and other factors.

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Makita’s Sustainability Management

Corporate GovernanceCompensation for Directors who are Audit &Supervisory Committee Members
The full amount of compensation for Directors who are
Audit & Supervisory Committee Members is fixed­compensation so that their independence from­management can be ensured; the specific amount isdecided through discussion among the Directors who
are Audit & Supervisory Committee Members.

Total Amount of Compensation (FYE 2023)

Category of Officer

Total AmountsofCompensation(Million yen)

Total Amounts of Each Type ofCompensation (Million yen)Basecompensation

Bonuses

Restricted
share compensation

Numberof
Eligible
Directors

Directors (Excluding
Audit & Supervisory
Committee
Members)(Excluding Outside
Directors)

189

95

60

34

9

Directors (Audit &Supervisory
Committee
Members)

15

15

—

—

1

Outside Officers

36

36

—

—

5

List of Directors
Position

49

Name

Attendance at Board of Directors’Meetings (Audit & Supervisory
Committee meetings)

Number ofCompany shares Held(as of March 31, 2023)

Chairman, Director*

Masahiko Goto

100% (12 of 12 meetings)

2,566,552

President, Director*

Munetoshi Goto

100% (12 of 12 meetings)

472,818

Director, Corporate Officer, General
Manager of Purchasing Headquarters

Shinichiro Tomita

100% (12 of 12 meetings)

19,595

Director, Corporate Officer, General
Manager of Research and Development
Headquarters

Tetsuhisa Kaneko

100% (12 of 12 meetings)

25,195

Director, Corporate Officer, General
Manager of Quality Headquarters

Tomoyuki Ota

100% (12 of 12 meetings)

20,095

Director, Corporate Officer, General
Manager of Domestic Sales Headquarters

Takashi Tsuchiya

100% (12 of 12 meetings)

20,795

Director, Corporate Officer, General
Manager of Production Headquarters

Masaki Yoshida

100% (12 of 12 meetings)

12,915

Director, Corporate Officer, General
Manager of International Sales
Headquarters

Takashi Omote

100% (12 of 12 meetings)

10,835

Director, Corporate Officer, General
Manager of Administration Headquarters

Yukihiro Otsu

100% (12 of 12 meetings)

10,435

Outside Director

Masahiro Sugino

100% (12 of 12 meetings)—

Outside Director

Takahiro Iwase

100% (12 of 12 meetings)

500

Director (Standing Audit & Supervisory
Committee Member)

Mitsuhiko Wakayama

Outside Director (Audit & Supervisory
Committee Member)

Shoji Inoue

Makita Report 2023

100% (12 of 12 meetings)(100%, 14 of 14 meetings)
100% (12 of 12 meetings)(100%, 14 of 14 meetings)

10,200500

Position

Name

Outside Director (Audit & Supervisory
Committee Member)

Koji Nishikawa

Outside Director (Audit & Supervisory
Committee Member)

Ayumi Ujihara

Number ofCompany shares Held(as of March 31, 2023)

Attendance at Board of Directors’Meetings (Audit & Supervisory
Committee meetings)
100% (12 of 12 meetings)

200(100%, 14 of 14 meetings)——* Representative Directors
Notes: 1. The Company provided notification on Mr. Masahiro Sugino, Mr. Takahiro Iwase, Mr. Shoji Inoue, Mr. Koji Nishikawa, and Ms. Ayumi Ujihara to the Tokyo Stock Exchange
and Nagoya Stock Exchange as being Independent Directors appointed by the Company, in accordance with the rules and regulations of each exchange.
2. Ms. Ayumi Ujihara was newly appointed at the 111th Ordinary General Meeting of Shareholders held on June 28, 2023.
3. Holdings of less than 100 shares through Makita’s stock ownership plan are not included in the number of Company shares held.

Reasons for Appointing Outside Directors
NameAppointment reason

Masahiro Sugino

He has participated in the management of LIXIL Group, including INAX, for many years and has a thorough knowledge of­corporate management, based on which he currently provides useful opinions on the management of the Corporation froma broad perspective. We expect him to utilize his wealth of experience and broad insight for the management of the Company
from an independent perspective.

Takahiro Iwase

He has participated in the management of core companies of the Toyota Group, including TOYOTA MOTOR CORPORATION, formany years and has a thorough knowledge of corporate management, based on which he currently provides useful opinions on
the management of the Corporation from a broad perspective. We expect him to utilize his wealth of experience and broad
insight for the management of the Company from an independent perspective.

Shoji Inoue

He has extensive knowledge and expertise gained through his practice as attorney at law, and expresses his opinions from thatperspective. We expect that he will reflect his wealth of experience and expertise in auditing and supervising the Company’s­management from an independent perspective.

Koji Nishikawa

He has extensive knowledge and expertise in corporate accounting audits as a certified public accountant, and expressed his­opinions from that perspective. We expect that he will reflect his wealth of experience and expertise in auditing and supervising
the Company’s management from an independent perspective.

Ayumi Ujihara

She has knowledge and expertise in extensive financial and accounting as a certified public accountant, and has abundant experience in audit work at global corporations. We expect that she will reflect her wealth of experience and expertise in auditing andsupervising the Company’s management from an independent perspective.

Strategic shareholdings
The Company holds shares of various companies, including
clients and associates in business relationships, for strategic purposes from a medium- to long-term perspective,
based on the criteria of whether or not the shares are
beneficial for business execution, such as strengthening
relationships with clients and business partners. In­addition, the Board of Directors regularly examines the
economic rationality and other factors of each individual
stock based on the significance of holding the stock andthe capital cost and verifies the appropriateness of suchholding from a medium- to long-term perspective. As
a result of the verification, we will consider selling stocks
for which the appropriateness of holding is notrecognized, and work to reduce the amount. Most
recently, at its meeting on June 28, 2023, the Board of
Directors completed its review of the situation as ofMarch 31, 2023.
Strategic Shareholdings at the End of the Fiscal Year

Number of issues
Balance sheet
amounts(Million yen)

FYE 2019

FYE 2020

FYE 2021

FYE 2022

FYE 2023

51

49

49

45

45

24,566

20,21330,693

20,942

21,170Note: The increase in the amount recorded on the balance sheet from FYE 2020 toFYE 2021 was due to an increase in the market value of strategic shareholdings
as a result of a rise in stock prices.

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Makita’s Sustainability Management

Corporate Governance
Messages from Outside Directors
Viewing Challenges as Opportunities tothoroughly Strengthen Makita’s Structure
Outside Director
Brief profile

Role in the Board of Directors Based on
My Own Knowledge

Although aggressive measures to expand production
have led to sales growth and a larger market share,
we are facing a significant performance decline dueto the rapid change in demand since the previous year.
I have management experience, and from that­perspective, the more profit declines due to weaksales, production cuts, or cost increases, the more­visible hidden issues in the cost structure become.
The collective efforts of every employee will be crucial
to the implementation of positive reforms. I actually
see this as an opportunity to thoroughly strengthen
Makita’s structure. Against this background, this is
why the Company-wide keywords for FYE 2024
have been set as “Eliminating Waste and Inventory
Optimization.”
The top priority when looking to significantly
expand production in response to sales growth is to
reduce anxiety from stock running out and shortages
among both sales staff and customers. These concerns
may make it hard to discern what constitutes appropriately optimized inventory levels, excesses, or­imbalances. Having a system in place to control­production fluctuations is crucial so that suddenchanges in demand do not force significant adjustments or decreases in production, thus ensuring thatinventory levels are always appropriate. For example,
conducting inventory inspections by product model isnecessary to ensure the functionality of the system.
The excess volume of total items is often overlooked as a factor leading to excessive total inventories. From the sales and production efficiency andmanagement perspectives, right now is the perfectopportunity to reduce the number of items on offerand consolidate them. In addition, it will be necessary
to establish rules covering the discontinuation of old
product lines when new products are introduced or
improved products are launched and when old productlines are sold out.
From the manufacturing technology perspective,
we will need to inspect production systems as well as
small-scale production lines that handle a wide variety
of products. As an Outside Director, I will be monitoring
the progress of efforts to strengthen Makita’s structure under the Company-wide keywords, “Eliminating
Waste and Inventory Optimization.”

Makita’s Strengths in Challenging Times

I feel that one of the strengths of Makita’s top management is how closely it monitors global politicaland economic trends and said management’s ability

51

Makita Report 2023

Masahiro Sugino

Appointed to the position of Makita Outside Director in June 2015.
Outside Director Sugino has an intimate knowledge of corporate
management gained through many years of involvement running
the LIXIL Group, including INAX Corporation. He currently serves as
Chair of the Nomination and Compensation Committee.

to steer the Company accordingly over the medium
and long term.
Makita is making proactive investments in electrification and cordless products, and it has the ability togather information regarding market demand for
product improvement using the strong connection
between technology, production, and sales. This is
the origin of Makita’s swift management. We also
have a robust service system that handles requests for
product repairs, which has led to a high level of trust
worldwide in our products and brand. All of thesefactors have contributed to increased sales and larger
market shares. I hope that these strengths will be­further enhanced to establish Makita’s position as top
in customer satisfaction.
The Company has established a global sales network
that, by spreading across multiple regions, decreases
risks from sales fluctuations, and I hope that we will
significantly leverage this strength to further develop
markets globally going forward.

Recognizing Our Challenges for Further Growth

To achieve sustainable growth, it is important to maintain a management structure that continuously nurtures
people and create an environment for this purpose, andto utilize this philosophy in human resource and organizational development. Next, even amid economic­fluctuations, we should strengthen our development,
and sales capabilities, and proactively invest in generating demand. Above all, we must maintain our brandstrength and image of reliability as a top manufacturer.
Also, Makita does have global strengths, but it must
always be prepared for sudden threats to performancesuch as geopolitical or cyberattack risks.

Initiatives for Sustainability and ESG

It is important to secure stable profits and return
those profits to society, but it is even more important
to engage in corporate management that is recognized for its fairness, integrity, and trustworthinessand to contribute to and continuously take the global
environment into consideration.
As an Outside Director, I recognize how important
it is to evaluate and be involved in these efforts.
Human rights issues and diversity management are
crucial issues for a global corporate citizen, and it is
becoming increasingly important for the entire
Company to possess a common understanding thatevery employee must act fairly and demonstratesocial awareness in their speech and actions and that
the Company must maintain a management structure
capable of responding flexibly to social changes.

Applying the “Sampo-yoshi”*
Approach to ESG
Outside Director
Brief profile

At Board of the Directors meetings, I draw on myextensive years of management experience in the
manufacturing, production engineering, and­production management departments to provide
advice based on actual on-site experience and to help
my fellow members gain insight into waste in­manufacturing, building a strong workplace, anddeveloping human resources. Through these discussions, I hope to contribute to Company-wide annual
policies that utilize Makita’s strong team power aswell as to strengthening revenue power by making
the most of our global development capabilities. In
particular, I believe that it is crucial to secure and­nurture the human resources who support corporate
activities from the ground up. I believe that focusing
on improving engagement from this perspective

Takahiro Iwase

Appointed to the position of Makita Outside Director in June 2021.
Outside Director Iwase has an intimate knowledge of corporate
management gained through many years of involvement in the
Toyota Group, including TOYOTA MOTOR CORPORATION.

will help us create a happy company and, in turn,a “Strong Company” enjoying sustainable growth.
At the same time, securing business sustainability
requires us to identify risk factors and implementa risk management PDCA cycle to manage said risk.
Given the ever-increasing speed and severity ofchange in the business environment, being able toquickly handle management issues will be crucial.
ESG issues are attracting particular attention, andI believe that by taking the “sampo-yoshi,” or the“good for three parties” (the Earth, shareholders, andemployees) approach to addressing them will help
differentiate Makita.
*A traditional Japanese principle which means “good for three parties,” referring to the seller, the buyer, and society.

Utilizing My Career Experience as
an Expert Accountant and as a Woman
Outside Director
Brief profile

In June 2023, I was newly appointed as an Outside
Director (Audit & Supervisory Committee Member) at
Makita. As a certified public accountant, I have­experience conducting audits on multiple companies
in a variety of industries. As corporate governancebecomes even more important, I would like to­contribute to the enhancement of Makita’s corporate
value through proactive supervision and the provisionof advice based on my accounting expertise.
Makita is promoting the advancement of women
and, based on my own career experience as a woman,

Ayumi Ujihara

Appointed to the position of Makita Outside Director (Audit &Supervisory Committee Member) in June 2023. Outside Director
Ujihara has an intimate knowledge of finance and accounting
gained through many years of involvement in audits of global
companies as a certified public accountant.

I would like to offer helpful advice to further­accelerate these efforts.
Makita’s strength lies in its abundant lineup ofenvironmentally friendly, convenient cordless­products and its brand strength, which has been built
up through its global sales and service network. To
ensure that the brand strength is maintained andenhanced even further, I will strive to maintain andstrengthen the governance system from my position
as an Outside Director (Audit & Supervisory
Committee Member).

Makita Report 2023

52

Makita’s Sustainability Management

Corporate GovernanceDialogue with Shareholders and Investors
The Director, Corporate Officer, and General Manager
of Administration Headquarters has general oversightover dialogue with shareholders and investors. The IR
department and the finance, legal, and internal audit
departments collaborate with each other, reviewing
and sharing disclosure information and preparing­disclosure materials, to facilitate constructive dialogue
with shareholders.
In addition to individual dialogue with shareholders
and investors, we hold a briefing session for each­quarter’s financial results. Twice a year (at the end of
the interim period and at the end of the fiscal year),the president gives a presentation, with presentation­materials published on our website. The ratio of shares
held by foreign institutions and individuals is over 30%,
so the Company actively discloses information in English,
including its financial statements, timely disclosure­documents, notices of convocation of the general
meeting of shareholders, materials for financial results
briefings, Corporate Governance Reports, and Company
publications (corporate profile, integrated reports suchas this report, and environmental reports). The
Company also translates major items (consolidated
financial statements and notes, business risks, etc.) fromits annual securities report.
In FYE 2023, in addition to quarterly financial results
briefings, management held 34 meetings with shareholders and investors. In addition to this, we actively
engaged in dialogue with shareholders and investors
through individual meetings with IR staff and participatedin conferences sponsored by securities firms. Also, we
analyzed the exercise of voting rights at shareholders’meetings and provided necessary feedback to management on the opinions of shareholders and investors
obtained through dialogue to ensure sustainablegrowth and enhance corporate value over the medium
to long term.

53interest, complying with relevant laws and social standards, properly disclosing information, respecting
human rights, restricting gifts and incentives, prohibiting bribes, and prohibiting unfair business transactions.
Employees are provided with regular information andongoing training about Makita’s Code of Ethics andGuideline to the Code of Ethics for Makita. In order toinstill an awareness of the importance of compliance,
employees are given an Ethical Compliance Survey,
while new hires and newly appointed managers areprovided with compliance training.
In order to minimize, pre-empt, quickly discover, andresolve conduct in violation of the Code of Ethics,
Makita has established regulations regarding
a Corporate Ethics Helpline (Internal Reporting) in­addition to an internal hotline as well as an external
contact for employees making reports. We have alsoestablished a point of contact on the Company website
for receiving external feedback and suggestions related
to accounting, internal control, and audits. Thoroughmeasures are taken in accordance with the regulations
to protect whistleblowers so that they do not incur any
disadvantage for reporting to the Corporate Ethics
Helpline. If necessary, the content of the reports is also
shared within the Company, and steps are taken to
remedy and prevent recurrence of the matter in question.

Status of Internal Audits
As an independent organization in charge of theGroup’s internal audits, the Internal Audit Division isstaffed by more than 10 personnel and conducts theinternal audits necessary to maintain managementsoundness. Results of audits are reported to the Audit &Supervisory Committee and to management personnel.
Furthermore, we have built a framework for making
timely and appropriate revisions when inadequacies in
the internal control system are discovered throughinternal audits.

Compliance

Risk Management

Makita upholds a philosophy of “striving to exist in­harmony with society,” an approach it applies uniformly
and that is reflected in our Management Policy/Quality
Policy. As such, we thoroughly ensure that officers andemployees comply with legal, regulatory, and ethicalprinciples. Makita’s Code of Ethics and Guideline to theCode of Ethics for Makita, which outline the conduct
expected of Group officers and employees, stipulate
the importance of ethical conduct, avoiding conflicts ofMakita strives to identify and manage risks witham
­ aterial impact on business activities, while also
­pursuing a commitment to being a company that isresilient to crises.
Makita’s Disclosure Committee, which identifies andinvestigates risks in the Group’s business activities,
holds annual meetings. These meetings are attended
by representative Directors, the Director in charge,
Standing Audit & Supervisory Committee Members,

Makita Report 2023

and General Managers of the Internal Audit Divisionand respective departments of the Company.
Each Director exercises authority and takes responsibility for implementing the Group-wide risk management
framework in their own division, and also reports to theBoard of Directors when a situation occurs that is­material to business management. In each division,­regulations and guidelines are stipulated and followed
in order to carry out risk management necessary for
quality control, disaster prevention, capital utilization,and the like.
Amidst concern in recent years over the occurrence ofmajor earthquakes and other natural disasters, Makita

recognizes that being able to respond to disasters isa critical issue. Makita has formed a Fire & Disaster
Management Committee comprising Directors and theheads of relevant divisions and has formulated disasterprevention regulations with this committee at the center. These disaster prevention regulations and othermeasures, which are reviewed regularly, define steps
for disaster prevention, emergency response ­measures,and disaster recovery efforts. Similarly, these regulations and measures outline a business ­continuity plan
(BCP) for times of disaster. The target organizations andscope of this plan are also reviewed as necessary.

Risks & Opportunities Relevant to Makita
Relevant Risks &Opportunities
Changes tothe social climate/market environment

Details
Risk

Opportunity• Deterioration of the market environment due to worsening economic conditions, social disorder,
enactment or changes to laws and regulations, and the like• New demand accompanying environmental changes such as labor shortages andthe post-COVID-19 “new normal”

Risk• Performance deterioration due to large-scale natural disasters, such as earthquakes, floods, fires,and so on• Drastic performance deterioration due to natural disasters in Japan and/or China, where our corebusiness operations are concentrated

Opportunity• Increased demand for products and services that contribute to early recovery from natural disasters
and peace of mind in times of disasterNatural disasters

Risk• Loss of competitive strength

Global competition
Opportunity

Risk

Technology & products
Opportunity

Risk

Procurement• Decline in new product development able to meet changing market needs• Delays in product development attuned to market prices• Large-scale recall(s) due to unforeseen product defects; damage liability lawsuit(s); major decline inbrand trustworthiness• Improved brand strength due to delivering customer satisfaction• Demand creation and acquisition of growth opportunities through new products• Production shortages and rises in production material costs• Delayed launch of new product sales due to component suppliers not meeting Makita’s
requirements, or due to taking too long to meet those requirements

Opportunity• Improved competitive strength and profits due to stronger relationships with suppliers and/or
discovering new suppliers

Risk• Loss of major customer(s) and a corresponding loss of opportunities to unlock sales channels• Deterioration of the financial position of customer(s)Relationships withmajor customers
Opportunity

Environment(incl. climate change)• Improved profitability from consolidating competitive superiority• Increased sales due to stronger relationships with major customer(s)Risk• Strengthening/adoption of regulations related to global warming, climate change, and so on

Opportunity• Increased demand for environmentally friendly products that contribute to decarbonization

Makita Report 2023

54

Corporate Data

11-Year Summary(For the years ended March 31)(Million yen)

U.S. GAAP

2013

2014

2015

2016

2017

2018

¥ 309,630¥ 383,207¥ 414,718¥ 423,623¥ 414,999¥ 477,298

Domestic

56,55566,01967,74068,44574,381

82,575

Overseas

Net sales

253,075

317,188346,978

355,178

340,618

394,723

Operating income

45,36654,914

71,90564,67662,564

79,762

Income before income taxes

45,691

56,974

68,394

61,49264,73879,678Net income attributable to Makita Corporation

31,07638,45345,307

41,61544,78254,755

Net cash provided by (used in)operating activities¥  38,364¥  41,686¥  35,894¥  34,188¥   63,351¥  33,294

Net cash provided by (used in)investing activities(15,414)(20,084)(20,096)(6,573)(5,015)(14,811)

Free cash flows

22,95021,602

15,79827,61558,33618,483

Net cash provided by (used in)financing activities(10,650)(7,365)(12,017)(18,719)(9,495)(17,743)¥  11,481¥  11,417¥  12,124¥  11,769¥  13,222¥  14,149

Depreciation and amortization

7,542

8,622

8,619

9,284

8,943

9,917

R&D costs

8,396

8,720

9,117

9,593

10,13910,894

Capital expenditures¥ 440,974¥ 519,121¥ 575,328¥ 558,024¥ 597,249¥651,031

Net working capital

266,950

310,750

358,245362,675

374,297

415,979

Total Makita Corporation shareholders’ equity

373,543435,934

486,021479,752

502,170

551,939

1,703

4,163

5,030

2,225

6,597

3,544

Total assets

Interest-bearing debt

Per share amounts(Yen)

Earnings per share (basic) net income attributable to Makita
Corporation common shareholders¥  114.46¥  141.65¥  166.89¥  153.30¥  164.96¥  201.70

Total Makita Corporation shareholders’equity per share

1,375.89

1,605.80

1,790.33

1,767.26

1,849.88

2,033.16

69.00

91.00

118.00101.00100.0061.00

Ratio of operating income to net sales

14.7%

14.3%

17.3%

15.3%

15.1%

16.7%

ROE

8.9%

9.5%

9.8%

8.6%

9.1%

10.4%

ROA

7.5%

8.0%

8.3%

7.3%

7.8%

8.8%

Total Makita Corporation shareholders’ equity
ratio to total assets

84.7%

84.0%

84.5%

86.0%

84.1%

84.8%

Cash dividends applicable to the year per share

Other data

Average number of shares outstanding
during the term

271,496,178 271,481,657 271,472,428 271,468,232 271,463,676 271,465,951

Number of shares issued excluding
treasury shares

271,491,854 271,475,252 271,469,736 271,466,522 271,460,572 271,467,928

Employees

12,68012,804

13,835

14,784

15,344

16,137

Notes: 1. Earnings per share (basic) net income attributable to Makita Corporation common shareholders and profit attributable to owners of the parent per share(basic) are computed based on the average number of shares outstanding during the term.
2. Figures are rounded up/down to the nearest million yen.
3. On April 1, 2017, Makita conducted a 2 for 1 stock split of its common shares. Earnings per share (basic) net income attributable to Makita Corporation common shareholders, total Makita Corporation shareholders’ equity per share, average number of shares outstanding during the term, and number of sharesissued excluding treasury shares were calculated assuming that the stock split was also conducted in prior years. Cash dividends applicable to the year per
share show the actual amount of the dividend before the stock split.
4. ROE is calculated based on the following:
U.S. GAAP: Net income attributable to Makita Corporation ÷ ((Total Makita Corporation shareholders’ equity at the beginning of period + Total Makita
Corporation shareholders’ equity at the end of period) ÷ 2) × 100
IFRS: Profit attributable to owners of the parent ÷ ((Equity attributable to owners of the parent at the beginning of period + Equity attributable to owners of
the parent at the end of period) ÷ 2) × 100
5. ROA is calculated based on the following:
U.S. GAAP: Net income attributable to Makita Corporation ÷ ((Total assets at the beginning of period + Total assets at the end of period) ÷ 2) × 100
IFRS: Profit attributable to owners of the parent ÷ ((Total assets at the beginning of period + Total assets at the end of period) ÷ 2) × 100

55

Makita Report 2023

(Million yen)

IFRS

2018

2019

2020

2021

2022

2023

¥ 477,298¥ 490,578¥ 492,617¥ 608,331¥   739,260¥  764,702

Domestic

82,575

92,129100,697

113,048

118,050

122,978

Overseas

Revenue

394,723

398,449

391,920495,283

621,210

641,724

Operating profit

80,23178,30564,046

88,46491,72828,246

Profit before income taxes

79,86579,91966,00887,19992,48323,887

Profit attributable to owners of the parent

54,94355,75047,73162,01864,77011,705

Net cash provided by (used in)operating activities¥   34,191¥   23,155¥   57,310¥   64,537¥ (103,660)¥   44,430

Net cash provided by (used in)investing activities(15,708)(15,329)(30,506)(42,913)(27,891)(37,680)

Free cash flows

18,483

7,826

26,804

21,624(131,551)

6,750

Net cash provided by (used in)financing activities(17,743)(8,231)(22,931)(23,036)

52,62680,970¥   15,045¥   23,867¥   44,409¥   49,855¥   59,937¥39,088

Depreciation and amortization

10,783

11,271

12,05813,881

17,63921,725

R&D costs

10,924

11,258

11,601

12,78314,145

14,903

Total assets

Capital expenditures¥ 654,841¥ 680,250¥ 674,564¥ 812,878¥1,007,497¥1,099,351

Net working capital

398,355

402,335

381,090

418,530

460,794

461,846

Equity attributable to owners of the parent

554,046

572,748571,275

657,855

746,344769,247

3,544

11,96019,737

16,45596,462

203,615Interest-bearing debt

Per share amounts(Yen)

Profit attributable to owners of
the parent per share (basic)¥   202.39¥   205.37¥   175.80¥   228.41¥   238.54¥    43.11

Equity attributable to owners of
the parent per share

2,040.93

2,109.83

2,104.01

2,422.80

2,748.64

2,832.89

61.00

62.00

53.00

69.00

72.00

21.00

Ratio of operating profit to revenue

16.8%

16.0%

13.0%

14.5%

12.4%

3.7%

ROE

10.4%

9.9%

8.3%

10.1%

9.2%

1.5%

ROA

8.8%

8.4%

7.0%

8.3%

7.1%

1.1%

Ratio of equity attributable to ownersof the parent to total assets

84.6%

84.2%

84.7%

80.9%

74.1%

70.0%

Average number of shares outstanding
during the term

271,465,951 271,467,574 271,502,528 271,524,393 271,530,966

271,539,104

Number of shares issued excluding
treasury shares

271,467,928 271,467,057 271,516,990 271,527,124 271,532,459

271,541,846

Cash dividends applicable to the year
per share

Other data

Employees

16,137

16,42417,09018,624

20,23318,804Makita Report 2023

56

Corporate Data

Stock Information(As of March 31, 2023)

Breakdown of Shareholders

Securities Code

6586

Stock Market
Listings

Tokyo Stock Exchange(Prime Market)

Financial institutions
and securities firms
109,388 (39.1%)

Nagoya Stock Exchange(Premier Market)

Individuals and others
32,475 (11.6%)

Number of shares(1,000 shares)

Total Number of
Shares Outstanding

The Number ofShareholders

Common shares 280,017,520(including treasury shares of
8,475,674 shares)

Foreign institutions
and individuals
100,540 (35.9%)

280,018

Other domestic
companies
29,139 (10.4%)

21,924

Treasury shares
8,476 (3.0%)

Major Shareholders (Top Ten)
Number of Shares Held Ratio of Shareholding(1,000 shares)
(%)

Name
The Master Trust Bank of Japan, Ltd. (Trust account)

45,605

16.79

Custody Bank of Japan, Ltd. (Trust Account)

15,058

5.54

Maruwa, Ltd.

8,638

3.18

MUFG Bank, Ltd.

8,426

3.10

BNYM AS AGT/CLTS NON TREATY JASDEC

6,817

2.51

Makita Cooperation Companies’ Investment Association

6,319

2.32

Sumitomo Mitsui Banking Corporation

5,800

2.13

Nippon Life Insurance Company

5,353

1.97

National Mutual Insurance Federation of Agricultural Cooperatives

5,102

1.87

The Bank of New York Mellon as Depositary Bank for DR Holders

4,643

1.70

Note: The ratio of shareholding is calculated based on the total number of outstanding shares (excluding treasury shares) as of the end of the fiscal period.

Share Price Trend(Yen)(Million shares)

6,000

30

5,000

25

4,000

20

3,000

15

2,000

10

1,000

5

35

7,000

0

2013/4

2014/4

Share price (left axis)

2015/4

2016/42017/42018/4

2019/42020/42021/42022/42023/30

Trading volume (right axis)

Notes: 1. On April 1, 2017, Makita conducted a 2 for 1 stock split of its common shares. For ease of comparison, the share price is the value after taking thestock split into account.
2. The share price is the closing price at the end of each month.

57

Makita Report 2023

Corporate Data

Corporate Data
(As of March 31, 2023)

Corporate Name

Makita Corporation

Head Office

3-11-8, Sumiyoshi-cho, Anjo, Aichi 446-8502, Japan
Telephone: +81 566 98 1711

URL

https://www.makita.biz/

Date of Founding

March 21, 1915

Date of
Incorporation

December 10, 1938

Paid-in Capital

24,205,610 thousand yen

Description ofBusiness

Production and sales of electric power tools, outdoor power equipment, pneumatic tools andhousehold equipment

Financial Year-end

March 31

Representative
Directors

Chairman Masahiko Goto
President Munetoshi Goto

Accounting Auditor

KPMG AZSA LLC

Consolidated
Revenue

764,702 million yen (fiscal year ended March 31, 2023)

Number of
Employees(consolidated basis)

18,804

Consolidated
Subsidiaries

53

Principal
Consolidated
Subsidiaries

Sales subsidiaries

Sales and production subsidiary

Makita U.S.A. Inc.

Makita (China) Co., Ltd.

Makita (U.K.) Ltd.

Production subsidiaries

Makita Werkzeug GmbH (Germany)

Makita (Kunshan) Co., Ltd.

Makita France SAS

SC Makita EU SRL (Romania)

Makita Oy (Finland)Technology development subsidiary
Makita Engineering Korea Co., Ltd.

Makita Report 2023

58

www.makita.biz