Nikko Chemicals Co., Ltd.
Providing information and raw materials in the fields of personalcare, pharmaceuticals and chemicals. Customized customer
support through our Open Laboratory.

Nippon Surfactant Industries Co., Ltd.
Manufacture of raw materials for cosmetics,
pharmaceuticals, food and other industries

Bergerac Japon Co., Ltd.
Contract and manufacturing nail enamel andnail care products

Nikoderm Research Inc.
Safety/efficacy evaluation of
cosmetics/pharmaceutical raw materials andpreparations. Proposal of appropriate
evaluation methods

Nikko Chemicals Shanghai Corporation
Import and sales of raw materials to the Chinese personalcare market (surfactants, oil based Ingredients, active
ingredients, vegetable oils, plant extracts, surface
treatment powders, etc.)

Nikko Chemicals (Singapore) Pte. Ltd.
Production and sale of surfactants/ester oil

CSR REPORTNIKKO CHEMICALS (INDIA) PRIVATE LIMITED
Research, procurement, manufacturing, evaluation, consulting
and marketing services, as well as the buying and selling ofchemical raw materials mainly for cosmetics, foods andpharmaceuticals, etc.

2024.04 Ver.02

CSR REPORTThe NIKKOL GROUP’s CSR
Message from the CEO

The origin of the products and services offered by the NIKKOL GROUP

Our environment is at a major turning point.
Consumer needs are diversifying with thedevelopment of technology and changing
lifestyles. It is precisely because we live in an
era in which there are no “right answers,”
that the social responsibilities of suppliers who
support our daily lives are so important.

can be traced back to the “real responsibility” that our founder,
Masami Sekine, set out to achieve.
The ideas that have been passed down over the past 70
years have been strengthened by the merger in 2022.
Under the slogan “NIKKOL 25 for 2030,” we willcontinue to strive for the realization of a

The NIKKOL GROUP is no exception. We havebeen involved in our own “CSR” and“sustainability” efforts even before the terms
became as relevant as they are today.

sustainable society while considering theinterests of our stakeholders.

Our activities cover a wide range of areas, but
their ultimate goal is “the people’s joy andhappiness.” Our more than 4,000 products are
proof of our sincere commitment to society.
The NIKKOL GROUP will continue to provide
new value based on our company policy,“Fostering of Creativity.”“Be aware of your true responsibilities
in all aspects of your social life and havethe courage to carry them out.”

Hideyuki Nakahara
CEO
Nikko Chemicals Co., Ltd.

Masami Sekine, Founder, “joint” November 9,1970

Giving back to the worldfrom the chemistry of beauty.

NIKKOL 25 for 2030
The 25 dreams that the NIKKOL GROUP
wants to realize by 2030
“Colloid chemistry and skin science are
creating a new future for the world.”
In order to become a company that cancontribute more deeply to society,
we have formulated 25 dreams and are
striving to realize them.

1

NIKKOL GROUP CSR REPORTEARTHTECHNOLOGY

BUSINESSTEAM

SOCIETY

Thinking of the Earthas we look to the future

Being a technology
leader in society

Forging a new way
forward in business

Building a better futurefor our employees

Establishing the
NIKKOL GROUP globally• Deliver to the world materials that use
only renewable resources.

• Change the world through surfactants
that only the NIKKOL GROUP can create.

• Continue to act as a human-centric company at
all times, even as our technology advances.

• Build a network capable of delivering
products to every corner of the world.

• Develop new recycling technologies
for energy and resources.

• Apply next-generation manufacturing
technologies, such as smart cell andsynthetic biology technologies.

• Offer greater support for the value ofincreasingly diverse definitions of what itmeans to be beautiful.

• Build a future that combines both thecompany’s vision and our employee’s dreams.

• Become known as the leader in dermatology
and colloid chemistry in Asia.

• Act as a company that is receptive to the trueneeds of our employees.

• Achieve a business approach that accounts
for the di erent needs, business practices,and social diversification of other countries.

• Become a company that people trust
by engaging in activities consistent
with a recycling-oriented society.

• Build the NIKKOL GROUP brandwith
elements from Japan.

• Engage in fair transactions to ensure
the sustainable development ofregional industries.

• Become a desirable company worldwide
by applying our strengths in thedevelopment of innovative new products.

• Contribute to regional societies not
only through the delivery of materials,
but also through education and otherservices.

• Use our knowledge in the area of colloid
research to contribute to theadvancement of society.

• Go beyond personal care to create new value
in the area of healthcare.
• Make advances not only in the sale ofmaterials, but also in the areas of solutions
and trading.
• Contribute to society in unfamiliar areas,such as in the preservation of cultural
heritage and in space development.
• Create new fans of the NIKKOL GROUP
through business expansions andcommunications.

• Go beyond the boundaries of what it means to
be a company, to become a place whereindividuals with shared values can congregate
and emerge.
• Leave behind categorizations by gender andnationality, to build an environment where each
person is allowed to freely choose how theywant to work.

• Become a reliable, trusted partner to othercompanies around the world.
• Share growth between the NIKKOL GROUP
and all people of the world.

NIKKOL GROUP CSR REPORT

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The NIKKOL GROUP’s CSR
The NIKKOL GROUP companies have implemented more than 150 CSR activities, both large andsmall. Underlying all of these activities is a commitment to fulfill our responsibilities as a member ofsociety. The 25 Dreams set forth in NIKKOL 25 for 2030 are the driving force behind these activities,
which culminate in our company policy, “Fostering of Creativity.”

BCP (Business Continuity Plan)
Company Policy

VisionFostering of Creativity

NIKKOL 25 for 2030

Nurtured since our founding
Contributing to society,
the NIKKOL GROUP’s DNA

25 dreams formulated by
all employees to realize
the “Fostering of Creativity”
in today’s society

The NIKKOL GROUP continuously examines its BCP countermeasures for further improvement,
and the Group's manufacturing and sales companies cooperate with each other in this regard.

Nikko Chemicals
Nikko Chemicals is responsible for the BCP of manufacturing,sales, and information security for the entire Group.
For example, the Global Purchasing Division searches for andevaluates raw materials to ensure the stability of productprocurement.
The SCM Division supports stable supply in terms of logistics.
The IT Planning and Promotion Division manages information
security measures in preparation for crises.

Commitment
Corporate GovernanceInternal Auditing

Information Disclosure

Accountability

Risk Management

Distribution of Corporate Value

The NIKKOL GROUP’s commitment to contribute to people around the world as a socially responsible entity

In January 2022, the NIKKOL GROUP establishedthe Sustainability Committee, which consists ofrepresentatives from each Group company.
By creating an environment in which information andactivities are brought back to the Group companies
for horizontal development or disseminated outside
the company, we are building a foundation for new
CSR activities to emerge.

NIKKOL GROUP CSR REPORTAs a supply base for businesses operating cosmetics businesses
in the Chinese market, Nikko Chemicals Shanghai maintains astable inventory of products procured from Nikko Chemicals andvarious raw material manufacturers.

Nikoderm Research
In cooperation with Nikko Chemicals, we collaborate withresearch institutes in Japan and overseas so that cosmetics,
pharmaceuticals, quasi-drugs, and food products can beevaluated and studied even in emergency situations.

Nikko Chemicals (Singapore)
The company has secured multiple contract manufacturing
partners and established an emergency manufacturing system.
In addition, the company has established a system for some
important products that allows it to mutually complement
Nippon Surfactant Industries.

NIKKOL GROUP
6 companies

150

SDGs

CSR initiatives*FY2022 results

Benchmarks
in each company
and department

3

Nikko Chemicals ShanghaiNew
CSR activities

CSR Promotion Structure

Bergerac Japon
In addition to decentralizing its manufacturing processes for nailenamel and nail care products, which are the company’s corebusiness, backup manufacturing locations have been established
to minimize the impact on supply in case of an emergency.

Nippon Surfactant Industries
In addition to the continuation of strengthening safetymeasures (such as earthquake-reinforcement of
manufacturing facilities), the company is working to ensure
the stable manufacture and sale of products by collaboratingwith external manufacturing contractors.
In addition, the company has a multiple number of
warehouses to ensure a stable inventory.
Furthermore, the company is strengthening relationships withpartners to enable mutual supply in case of disaster and otheremergency situations.

Organize& visualize
Disseminate
information“Sustainability
Letter”

Contribution to the realization ofa sustainable society

The NIKKOL GROUP will promote efforts to addressnine key issues through its business activities in order
to contribute to the achievement of the Sustainable
Development Goals (SDGs).

NIKKOL GROUP CSR REPORT

4

Environmental Management
The NIKKOL GROUP recognizes that protecting the global environment is a challenge common to all
humankind, and we strive to manufacture products with minimal environmental impact.
We also proactively implement improvements to manufacturing facilities and evaluations by
third-party organizations. As a specialty company, we are promoting the establishment ofenvironmental management throughout the Group.

CO2 Reduction Activities
Nippon Surfactant Industries’ Utsunomiya Factory is
promoting efforts to reduce its environmental impact.
We have installed solar power generation systems andDO meters (dissolved oxygen meters) to promote energy
conservation.
In addition, we have begun to switch from heavy oil toliquefied natural gas by installing boilers that use liquefied
natural gas, and have reduced greenhouse gas emissions
by approximately 25% (comparing the average annual CO2
emissions between 2006-2008, when heavy oil was used,and 2015-2017, when liquefied natural gas was used).

ASD (Action for Sustainable Derivatives) is a business-to-business organization that promotes change
throughout the supply chain of palm oil derivatives, primarily in the international personal care industry.
It aims to support the production areas, and is based on the NDPE Principles, which are international
standards for palm oil procurement, prohibiting deforestation and respecting human rights.
Nikko Chemicals is the first ASD member company in Japan to participate from the perspective ofpromoting the SDGs.
We will pursue transparency in the supply chain of palm oil derivatives and palm oil-derived products
in which the NIKKOL GROUP is involved.

Supportinglivelihoods
in production areas

Prohibit
deforestation

Respect
for human rights

ISO 14001(Environmental Management System)
Greenhouse gases

Approx.
Heavy oil

ASD Certification

City gas25%

reduction

Bergerac Japon is ISO 14001 certified, which is aninternational management system standard that aims to
reduce environmental risks and contribute to theenvironment based on the concept of sustainability.
The goal is to continuously improve the level ofenvironmental management based on the PDCA
(Plan-Do-Check-Act) cycle, while being aware ofsocio-economic needs.

Wastewater Treatment
Nippon Surfactant Industries’ Utsunomiya Factory has
installed reused water equipment in some of the processes
conducted at the facility.
We strive to protect the environment by reducing theamount of wastewater leaving the facility.

R&D Center’s
ZEB ReadyZEB (Net Zero Energy Building) is acertification system for buildings that aim toachieve both a comfortable indoor
environment and energy savings.
The buildings are classified into four ranks
such as ZEB, Nearly ZEB, and ZEB Readyaccording to their energy reduction rate.
The Nikko Chemicals R&D Center has
installed energy-saving equipment andreduced its energy consumption to less than
50% of the conventional energy requirements.
Consequently, the center has been certified as
ZEB Ready.

Eco-Action 21

EcoVadis

Eco-Action 21 is a unique Japanese environmental
management system established by Japan’s Ministry of theEnvironment. Companies that adopt the system are required to
improve the environmental performance of the products they
produce, sell, and provide, and to improve their services.
The results of these efforts are annually published in anenvironmental management report.
Nippon Surfactant Industries has acquired this certification
every year since 2012, and in August 2021, the company wasrecognized by the Eco-Action 21 Central Secretariat as a“certified permanent business.”

EcoVadis is a corporate sustainability evaluation
system provided by EcoVadis, an independent
evaluation organization.
It is based on ISO 26000 and other major standards,
and evaluates a company’s CSR activities in termsof the environment, labor and human rights, ethics,
and sustainable procurement.
There are four certification levels consisting of
Platinum, Gold, Silver, and Bronze, and Nippon
Surfactant Industries received Bronze certification inJune 2023.

認証番号0008695

5

NIKKOL GROUP CSR REPORTNIKKOL GROUP CSR REPORT

6

Quality Management
Quality management is a responsibility that a company must fulfill in order to expand its businessboth domestically and internationally. The NIKKOL GROUP has achieved a high-precision quality
management system based on technology and know-how cultivated over our long history.
We supply safe and reliable products and services to our stakeholders.

RSPO Certification
The RSPO is an international non-profit organization
founded by seven organizations to promote the sustainableindustrialization of palm oil.
The NIKKOL GROUP aims to maintain a sustainable supply
system and conserve biodiversity. As part of this approach,
Nippon Surfactant Industries and Nikko Chemicals(Singapore) have acquired RSPO Supply Chain Certification
to manufacture RSPO Mass Balance (MB) products.
Furthermore, in June 2022, our RSPO members collectively
achieved 97.76% of MB certified palm derivatives in theirpurchased raw materials and products.

2017–
Joined as a full member of RSPO
• Nikko Chemicals• Nippon Surfactant Industries• Nikko Chemicals Shanghai• Nikko Chemicals (Singapore)2018
Acquired certification as a certified
factory for manufacturing RSPO
(MB) products

Pharmaceutical
Manufacturing License

2022
RSPO Mass Balance (MB)97.76% of products certified• Nippon Surfactant Industries• Nikko Chemicals (Singapore)(Quality Management System)
ISO 9001 is the international standard for a quality
management system.
It is the most widespread management system standard,with more than 1 million organizations in more than 170
countries worldwide having obtained certification.
Nippon Surfactant Industries and Bergerac Japon, bothcertified companies, are promoting continuous
improvement of their products and services based on thequality policy defined in ISO 9001.

NIKKOL GROUP CSR REPORT

Tochigi HACCP (the Tochigi Prefecture foodhygiene management certification system) is asystem that certifies facilities that have adopted
HACCP, an international standard for hygiene
management, and can continuously performbasic hygiene management.
In August 2020, Nippon Surfactant Industries’
Utsunomiya Factory acquired Tochigi HACCP
certification, and this enables us to takeappropriate management and countermeasuresin all processes from receiving raw materials to
final products.

A pharmaceutical manufacturing license is required to
manufacture pharmaceutical products.
Nippon Surfactant Industries’ Utsunomiya Factory has obtained
this license in accordance with administrative procedures inorder to manufacture high-quality, safe, and reliable
pharmaceutical products.

ISO 9001

7

Tochigi HACCP

Food Additive
Manufacturing License

EFfCI GMP
Certification

A food additive manufacturing license is a permit required to
manufacture food additives.
Nippon Surfactant Industries’ Utsunomiya Factory has obtained
this license in accordance with administrative procedures.

In February 2013, Nippon Surfactant Industries’
Utsunomiya Factory became the first in Japanto receive EFfCI GMP certification, theEuropean standard for cosmetic ingredients.
This certification reinforces hygiene control
items not covered by ISO 9001 and enables
quality control specifically for the production of
cosmetic ingredients.
In December of the same year, the company
passed the maintenance audits for EFfCI GMP
and ISO 9001: 2008.

NIKKOL GROUP CSR REPORT

8

Human Resources & Labor Management
The NIKKOL GROUP is working to foster both an organizational climate and corporate culture
suitable for the next generation and to realize new ways of working. We are striving to establish not
only the enhancement of work-life balance, a remote work environment, promotion of childcare leave
for male employees, and diversification of human resources (multinational human resources), but also
initiatives to support the true needs of our employees as advocated in NIKKOL 25 for 2030, and thestrengthening of compliance.

Engagement
The NIKKOL GROUP has been working on activities to improveengagement since 2020. In the first year, we introduced a system of
1-on-1 interviews between supervisors and subordinates and “Wevox,”
a tool for measuring and analyzing engagement. From the third year
onward, we aim to foster a proactive corporate culture in which eachdepartment each division actively contributes to the creation of a betterorganization based on the know-how and mindset we have cultivated.

Engagement scores / distribution & graphs by “Wevox”

Response

A contact point for reporting and consulting on internal
compliance violations or suspected violations is essential to thehealthy growth of a company.
The NIKKOL GROUP has established an internal reporting
system known as NICALL 119 to provide a solid foundation for
this. The system covers all personnel engaged in Group
operations, including directors, regular employees, contract
employees, and part-time workers. If a report is found to be true,
the violator is subject to strict disciplinary action in accordancewith company rules, and the informant is notified of the results.

9ReportingandConsultation

At Nikko Chemicals, female managers account for about
22% of the total workforce.
Nikoderm Research and Nikko Chemicals (Singapore)
have reached approximately 33% and 40%, respectively.
In addition, Nippon Surfactant Industries has formulated ageneral business owner action plan based on the Act on
Advancement of Measures to Support Raising
Next-Generation Children and the Act on the Promotionof Women’s Active Engagement in Professional Life.
The entire Group will continue to aim for an environment
in which female employees can exercise their abilities andwork comfortably.

How NICALL 119 Works

Contact

Investigation

NIKKOL GROUP
Internal consultation

Third-party
organizations

LawyerContact for Reporting& Consultation

Contact withinvestigation
results

High rate of remote work

30%
Under Normal
circumstances

Over

70%

under declared stateof emergency

Promotion of MaleChildcare Leave

The NIKKOL GROUP has been promoting for male
employees to actively take childcare leave from 2021.
Through educational activities, pamphlets, and actively
communication, we are creating an environment thatmakes it easier for employees to take childcare leave.
At Nikko Chemicals, four employees took childcare leavein fiscal 2022 (an increase of three from the previous year).
In the same year, Nippon Surfactant Industries also saw
its first employees take childcare leave, with three
employees taking advantage of the system.

All people
working for the
NIKKOL GROUP

Compliance Officer

NIKKOL GROUP

Wide Range of Reporting& Consultation

Three Reporting& Consultation Counters

Four Ways to Report& Consult

We accept reports and consultations
based on our philosophy of “Keep the door
wide open, being accessible and reliable.”
In addition to a hotline for legal orcompany rule violations, we also place
importance on a helpline for consultation
on problems.

In addition to our in-house team of experts,
lawyers and third-party organizations thatare available for consultation, consultations
are possible in Japanese, English andChinese, and multilingual staff members
can be called in for interpretation andthree-way calls.

There are four ways to report or consult witha third-party organizations: online,
telephone, e-mail, and by post. The nameand affiliation of the person reporting or
consulting will not be reported within thecompany without their consent.

NIKKOL GROUP CSR REPORTThe NIKKOL GROUP is promoting work styles that encourages employee
independence and autonomy, allowing them to exercise their creativity.
As part of this effort, Nikko Chemicals is encouraging employees to workfrom home to improve productivity.
Even during normal times, the remote work rate is maintained at 30%.
During the spread of COVID-19 (under a declared state of emergency),
the remote work rate exceeded 70%.

Women in the Workforce“Wevox,” an engagement measurement and analysis toolInternal Reporting System
NICALL 119

Work Style Development

Multinational Workforce

Turnover Rate

The NIKKOL GROUP is currently
developing a project to improvethe environment for hiring andaccepting foreign employees.
As of January 2023, we have
employees of 11 different
nationalities, including Japanese,
Brazilian, Chinese, American, andMyanmarese.

The 1-on-1 interview system is highly
rated by our employees, withapproximately 60% of users responding“good” or “very good.”
It is also effective in preventing turnover,with the turnover rate at the four
domestic group companies remaining
around 5% from 2019 to 2021.

Nationalities of
employees

11nationalities

Turnover
rate

5.1%

NIKKOL GROUP CSR REPORT

10