Yokohama Rubber

C a r i n g f o r t h e Fu t u r e

CSR Report 2019

Yokohama Rubber

CSR Report 2019

CONTENTS

Editorial Policy

Contents / Editorial Policy

01

Management Policies / CSR Slogan

02

Message from the President

03

CSR Management Aimed
at Realizing a Sustainable Society

05

Corporate Governance07

Products

09

The Earth11

People13With the aim of realizing our corporate vision – “to build a trusted
identity as a contributing member of the global community” –the Yokohama Rubber Group has been rolling out a series ofcorporate activities that are deeply rooted in the individual
regions where we operate throughout the world, under ourGrand Design 2020 (GD2020) medium-term management plan.
To this end, we are working to address social issues on the basisof our CSR slogan – “Caring for the Future” – and in line with thefive key aspects of Corporate Governance, Products, the Earth,
People and Community.
This Report was created to share the Yokohama RubberGroup’s policies, approach to CSR, orientation, specific measures,
performance, and how they relate to the U.N. Sustainable
Development Goals (SDGs), with each of the Group’s
stakeholders in a concise and clear manner.
To help ensure the peace of mind of all of our stakeholders –including customers, suppliers, local communities, and the global
environment as a whole – we provide more details about ourenvironmental, social and corporate governance (ESG) initiatives,in which, in our business management, we strive to ensure
fairness and harmony between our high-quality monozukuri
manufacturing operations and the needs of the environment andsociety on our CSR website (which follows the GRI standards) andin our Securities Report and Annual Report; we suggest that you
read these other materials in combination with this Report.

The Yokohama Rubber Co., Ltd.
36-11, Shimbashi 5-chome, Minato-ku, Tokyo
105-8685, Japan

Yokohama Rubber

Corporate Social Responsibility Planning Department
Tel. +81-3-5400-4705

CSR Report 2019

Corporate Communications Department
Tel. +81-3-5400-4531

Community

15

Support for local communities in collaboration with Chelsea F.C.
Yokohama Rubber is an official club partner for English Premier League football club Chelsea F.C. The Chelsea Foundation wasestablished by Chelsea F.C. to contribute to the cultivation of young people through football (soccer); the Chelsea Foundation carries
out social contribution activities involving sport in countries all over the world, and Yokohama Rubber provides sponsorship forthese activities. When Yokohama Rubber organizes soccer schools for local children in countries where we operate – including Qatar,
Italy, Russia, the U.S.A., Vietnam, Japan, etc. – the Chelsea Foundation provides support by dispatching coaches, etc. to assist withthese programs. To date, several hundred children have learnt positive life lessons through soccer by participating in these activities.
Projects of this kind on which Yokohama Rubber and the Chelsea Foundation collaborate together also help to strengthen the
Yokohama Rubber brand.
In the U.K., we have been involved in activities that help to spread awareness of the importance of vehicle safety inspections
among Chelsea F.C. fans. In the future, we will continue to collaborate with Chelsea F.C. to make a proactive contribution towards
both tire safety and local communities.

C a r i n g f o r t h e Fu t u r e

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All o fCommunication with Experts

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Soccer schools(Left) Ho Chi Minh City, Vietnam(Right) Harlem, New York, U.S.A.

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Yokohama Rubber is a signatory to the United Nations Global Compact.
Yokohama Rubber is an advocate of Fun to Share, a climate change program working to realize a low-carbon society.
Yokohama Rubber Group is an official partner of Chelsea F.C.
This publication was printed on FSC®-certified paper, which includes materials from timber manufactured in properly managed forests.
This publication was printed using a waterless printing method that does not emit hazardous waste fluids.
This publication was printed with vegetable oil ink which has zero emissions of VOCs (volatile organic compounds) that cause atmospheric pollution.

Third-party Opinion /Response to Third-party Opinion

01

18

Business and Main Productsof Yokohama Rubber

19

Yokohama Rubber Groupat a Glance

21

CSR Report
Provides a concise,clear introduction
to our company’s CSR.

CSR Website
Provides more detailed information
about our CSR initiatives(https://www.y-yokohama.com/global/csr/)

Period covered by the Report: January 1, 2018 to December 31, 2018
(Information includes some activities whichwere conducted in and after January 2019)

Date of publication: October 2019 (the Report is issued annually)

－ Basic Philosophy －To enrich people’s lives and contribute to their greater happiness
and well-being by devoting our wholehearted energies
and advanced technology to the creation of beneficial products.
－ Management Policies －
●

●

●

●

－ Action Guidelines －Take on the challenge of new technologies
to produce new value.

●

Develop proprietary business fields
to expand the scope of business.
Create a workplace that values,
improves and energizes people.

Develop ourselves so that
we may give our personal best.

●

Trust, challenge and improve one another.

●

Nurture a welcoming, open spirit.

－ Corporate Slogan －Deal fairly with society and value harmony
with the environment.

Excellence by nature－ CSR Slogan －Caring for the Future

Caringfor the Future
Make life more fulfillingfor people everywhere.

Products

The Earth

PeopleCommunity

Deliver fun andpeace of mind.

Leave a soundenvironment tofuture generations.

Build on eachother’s strengths.

Earn theconfidence of
our neighbors.

Corporate GovernanceLay a solid foundation for
fulfilling social expectations.

02Message from the President

Realizing “Business Creation”
and “Business Maintenance”
simultaneously, andcontributing to the creationof a new-generation society
Masataka Yamaishi
President and Representative
Member of the Board

Implementing our Grand Design 2020 (GD2020)
medium-term management planIn fiscal 2018, the Yokohama Rubber Group launched our Grand
Design 2020 (GD2020) three-year medium-term management plan.
GD2020 is intended to strengthen our managerial foundations
through appropriate growth strategies for each individual
business, in preparation for achieving even faster growth during
the rapidly approaching 2020s.
When thinking about management strategy, one cannot ignore
CSR. We will be working proactively to implement CSR initiatives
based around our CSR slogan: “Caring for the Future.”
At Yokohama Rubber, we aim to contribute to the enrichment ofsociety and of the planet as a whole through the Yokohama RubberGroup’s business activities by working closely together with all of
our stakeholders, including our business partners and local
communities. To this end, we are working to win stakeholders’unwavering trust by implementing measures in relation to social
justice, new value creation and business expansion, ensuring that
our operations are in harmony with the global environment,
building a corporate environment in which employees encourage
each other to grow and develop, and in which individuals arevalued, and the further strengthening of our already close ties withlocal communities.

The changing social environment
and the steps we need to takeIn recent years, the social environment has been changing
throughout the world, and there has been a dramatictransformation of the environment in which our company
operates. Today, more than ever, there is a need for action directed
at the realization of a sustainable society.
The international community has adopted the Sustainable
Development Goals (SDGs), a set of 17 Goals and 169 Targets thatthe world as a whole will be working together to achieve by 2030,
as an initiative for realizing a sustainable world. Yokohama Rubber
is also participating in the United Nations Global Compact (GC),and we are implementing various measures in relation to the GC
through our business activities together with different

03

stakeholders. As an example of one of these activities, in 2018
Yokohama Rubber formulated a Procurement Policy for the
Sustainable Natural Rubber in collaboration with the World
Business Council for Sustainable Development (WBCSD). By sharing
this policy with the entire supply chain, including natural rubber
plantations and suppliers, we are working towards the realizationof a society with sustainable natural rubber.
In addition, besides our continued provision ofenvironmentally-friendly products to support the next-generation
mobility society and its infrastructure, we are also continuing toprovide support for NPOs and for areas that have been affected bynatural disasters through the volunteering activities of ouremployees and through the YOKOHAMA Magokoro Fund, social
contribution fund. Through the links that we have built with somany different people, and through the various measures that weare implementing, we aim to ensure that the individual companies
and factories of the Yokohama Rubber Group come to be viewed as
indispensable by their local communities.

Working together with Yokohama Rubber Group employees
Safety, Compliance and Quality are the key management
fundamentals that underpin our business activities. In fiscal 2018,
Yokohama Rubber once again experienced a number ofoccupational accidents and small-scale fires. Although the numberof such accidents has been reduced over the past three years, wehave not yet succeeded in reducing the incidence to zero. I haveissued a number of messages to employees on this subject, andhave engaged in dialog with the managers of individual units
regarding safety issues on numerous occasions. I hope that, by
getting every individual employee to take safety seriously as
something that affects them personally, we can work together torealize the goal of completely eliminating occupational accidents.
On taking up the position of President, I gave an address on thesubject of “Business Creation and Business Maintenance.” “Business
Creation” and “Business Maintenance” are both equally important,and unless we promote both of them simultaneously we cannot

The 14 th company-wide safety and disaster prevention meeting (December 2018)

expect our company to survive in the marketplace. Internal
improvements (Business Maintenance) and growth strategies(Business Creation) are linked to the addressing of problems relating
to the sustainability of society, the environment, and the businessenterprise itself. In order to continue to implement measures aimed
at the realization of the post-carbon society and the achievement of
the SDGs, it is vitally important that we continue to challenge
ourselves on an ongoing basis by identifying areas for improvementin our work and in our daily lives, recognizing that we need to treat
these issues as matters of personal concern, and working together
with those around us to address them. As a company, we can takethis to an even higher level by effectively utilizing the know-how that
we have accumulated over the years to build workplaces
characterized by enhanced mutual respect and by diversified humantalent helping one another to maximize their potential. We can thengo on to build new business models that contribute towards
improving next-generation lifestyles, business, and the social
environment as a whole.

Relationship between SDGs and Caring for the Future

Caring for the Future
Make life more fulfilling for people everywhere.
Corporate GovernanceLay a solid foundation for supporting sustainable businessactivity in accordance with international norms.
Conduct activities that contribute to governance,compliance, and business continuity.

The Earth
Address environmental
concerns through ouroperations and help leave asound natural environment
to future generations.
PeopleNurture values accommodating
diversity in the workplace and in
the community at large.
Community

Products
Deliver products and services that help
people enjoy fulfilling lives with peaceof mind.

Earn the confidence of neighbors
through robust community
engagement.

04

CSR Management Aimed at Realizing a Sustainable Society
The Company is engaged in CSR management that promotes business expansion and CSR in an integrated mannerin addition to a medium to long-term perspective for achieving a sustainable society. In addition, by linking the CSR
Slogan “Caring for the Future” and the SDGs, we will clarify the purpose and significance of contributing to society
through our business and work to increase social value and corporate value.
Pillars of the GD2020
medium-term management plan

Caring for the future and the SDGs

Consumer tires

Products

Expand our presence in thepremium tire market

Deliver products and services that help people enjoy
fulfilling lives with peace of mind.

Growth strategy

Commercial tires
Make commercial tires a pillar ofrevenue driven by OHT*
* OHT: Off-highway tires (tires for agriculturaland forestry machinery, industrial andconstruction vehicles)

The Earth
Address environmental concerns through our operations
and help leave a sound natural environment to future
generations.

MB* operations
Allocate resources on a priority
basis to business fields ofstrength (automotive parts,
offshore business, etc.)* MB: Multiple Business

PeopleNurture values accommodating diversity in theworkplace and in the community at large.

Revitalize our corporate
cultureFortify our business foundation

Revitalization of organization
through human resources
measures

Earn the confidence of neighbors through robust
community engagement.
Corporate governanceRisk management

Corporate Governance
Financial strategy
Cash flow creation
Effective use of group funds

05

Community

Lay a solid foundation for supporting sustainablebusiness activity in accordance with international norms.
Conduct activities that contribute to governance,compliance, and business continuity.

Initiatives through related businesses

Economic value

FY2020 target●Tires with high safety, quality, and environmental

performance●Tires for agriculture and forestry machinery that

contributes to sustainable production in the agriculture
and forestry industry

Sales target●Tires for industrial and construction vehicles that supportsocial infrastructure●MB products that contribute to greenhouse gas reductions

Consumer tires
Commercial tires
MB operations and other●Business activities that reduce our environmental

impact and conserve biodiversity

We set targets for each
operating division and aim
to achieve sales targets.

●Sustainable natural rubber procurement●Yokohama Forever Forest activities

Sales revenue:
700 billion yen
Operating income:70 billion yen
Operating margin: 10%
D/E ratio: 0.6 times●Occupational health and safety and disasterprevention activities●Improvements in human resources development andproductivity●Respect for diversity, promotion of active participation

Conserving resources andimproving high-efficiency
productivityof women●Respect for human rights at suppliers●Support for healthcare, education, etc.

Employing, securing, andusing outstanding humanresources for the provisionof reassuring andcomfortable products andservices

ROE: 10%
Operating cash flow:
200 billion yen*3-year cumulativein local communities●Support during disasters●Creation of employment in regions where our business

Improvement in reputationin Japan and overseas

is developed●Strengthening corporate governance●Organizational management and minimization of risks●Compliance

Improvement in the appeal of investment(Dividends, stock price, ESG investment)

06

Corporate Governance

Creating the foundations for
global management

Strengthening the corporate governance structure
Achievement of an optimal corporate governancestructure
To fortify our business foundation, we are implementing various
measures for strengthening of our financial position including
reduction of interest-bearing debt and asset reduction,
revitalization of corporate culture, risk management, etc.

mutually independent activities and Company Auditors acquire
information from Financial Auditor and audit departments asappropriate in an effort to strengthen the audit function.

Strengthen global governancePositioning our regional management companies as holding companies(strengthening governance at our overseas subsidiaries)● Appointing internal auditors at the regional management companies(strengthening audit structure on subsidiaries)● Setting up whistleblower hotlines worldwide to help detect problems early
and to prevent small problems from escalating●

Yasushi Kikuchi

Hisao Uchida

Atsushi Kamei

Megumi Shimizu

Hiroki Kimura

All Company Auditors

Board of Directors system reforms●●

Introduction of a compensation plan with restricted stock
Increase in number of Outside Directors and decrease in number of Internal
Directors

In an aim for the efficient operation of the Board of Directors andin an effort to ensure transparency of management and further
strengthen corporate governance, we have assigned four Outside
Directors and reduced the total number of Members of the Board
from ten to nine members. In addition, nomination andremuneration matters related to officers are discussed by the
Officer Nomination and Remuneration Committee and thendecided on by the Board of Directors to ensure transparency andfairness. There have been three committee members (of which, two
are Outside Directors) since April 2019.
Company Auditors attend important meetings and committees
including the Executive Committee in order to gain anunderstanding on the status of operational execution. In addition,
the Audit Office serves as an independent organization that
conducts internal audits on each business and checks that
operations are being conducted appropriately.
The audit structure consists of audits by Company Auditors who
audit the performance of duties by Members of the Board of
Directors, accounting audits by the Financial Auditor, andoperational audits and accounting audits on executive departments
and Group companies by audit departments. These bodies conduct

07

A Risk Management Committee chaired by the Head of Corporate
Administration Division has been established to strengthen the
defense system in response to the various risks facing the company,
and risks that can have a significant impact on management aremanaged throughout the organization, and appropriately evaluatedand responded to. In addition, the status of activities of eachmeeting body is reported to the Executive Committee as appropriate
and reported to the Board of Directors if deemed necessary.
Number of times held in fiscal 2018
Corporate Compliance Committee

4 times

Risk Management Committee

4 times

Personal Information Protection Management Committee

6 times

Export Control Committee

2 times

Information Security Committee

2 timesTOPIC

Implementation of compliance education aimed
at the introduction of whistleblower hotlines
Compliance education was held at Yokohama Tire Philippines three times from October
25 to 26, 2018. It was participated in by a total of 334 people including 40 management
executives and employees from all departments. Training materials were prepared in
English and Tagalog (local language) in an effort to spread awareness on matters
including the importance of compliance, compliance with competition law, and thewhistleblower framework so that acts such as bribery do not occur.
Reports are made every month to the Corporate Compliance Department on thestatus of survey and response if there were internal notifications or reports. In fiscal
2019, we will endeavor to establish the structure to introduce whistleblower hotlines.

Number of compliance reports

112 reports (fiscal 2018, consolidated)

Strengthening the compliance structure
The Corporate Compliance Hotline is a system that also supports
anonymous reports in accordance with the Whistleblower
Protection Act. The telephone number and email address forcontact points are stated on the compliance card that is distributed
to all members (officers, employees, part-time employees,
non-regular employees, dispatch employees, and employees ofcontractors) working at the Group’s business locations. There are
two types of contact points (internal and external) for hotlines, andexternal law firms have been assigned to external contact points toensure independence. The General Counseling Room is a systemthat members can consult with about anything when there are
doubts concerning compliance.

Whistleblower hotline and monthly report system

Domestic whistleblower
Whistleblowing
Report

FY2018FY2017

Corporate Compliance Hotline

47

56

58

General Counseling Room

40

61

54

Total

87

117

112

174 compliance officers have been assigned to Group companies
in Japan and overseas. At overseas subsidiaries, the Global
whistleblower hotlines have been established to enable thecompany’s Corporate Compliance Department to gain a direct
understanding of competition law violations and acts of bribery
through an external contact point. In February 2018, the hotlines
were first introduced at regional management companies and tire
sales companies in China. Since then, we have made preparations
for introduction of the hotlines in the Philippines and Thailand. In
2020, we will expand the hotlines to other regions in an aim tostrengthen the governance structure on a global level.

SurveyResponse

Compliance card
To internal or external
contact point(Compliance with anti-bribery
and competition laws)

Overseas
whistleblower
Whistleblowing
ReportLaw firms
in Japan

SurveyResponse

Overseas whistleblower
Whistleblowing/
survey/response

Contract local law firms

Monthly report officers(174 people)
87
departments

Number of whistleblowing reports and consultations (consolidated)
FY2016

Global whistleblower hotlines

Whistleblower hotlines

38
companies
in Japan46
companies
overseas

ReportSurveyResponse

Corporate Compliance Department
ReportCompliance Committee

Feedback from a monthly report officer
I am responsible for nine companies in Europe. Although, aPermanent Compliance Committee has not been
established, we set up a temporary one if necessary andrespond to each reported matter
individually.
YEU is planning to introduce theWhistle Blower system including
tutorial section to its European
subsidiaries within 2020.

Annette Mayer(Yokohama Europe GmbH; YEU)

08

Products

Special tires for agriculturaland forestry machinery that
contribute towards realizing
sustainable production in the
agriculture and forestry sector

Contributing to the sustainable use of forest resources through tires
that do not hinder trees from regenerating
Alliance ELIT tires – Committed to supporting
sustainable forestry
As a result of the intensive utilization of global forest resources,
over the period 1990 – 2015 the world lost an area of forest
equivalent to 129 million hectares. In selling our products tocustomers in the forestry sector, we hope that logging activity will
be balanced by the planting of new trees, so as to help bring about
growth in overall forest resources.
However, when forestry machinery is driven into the forest, theweight of the machinery compresses the soil, eliminating the gaps
between the particles of soil. When new tree seedlings are plantedin this compacted soil, their root systems cannot spread out, whichmakes it difficult for the trees to grow properly. With the number of
new trees growing failing to balance out the number of trees
harvested, the forest may gradually disappear. Responding to thisproblem, since 2012 the Alliance Group has been working on thedevelopment of a new type of tire that enables forestry vehicles tokeep moving even when the tire is at low pressure, thereby
preventing the soil from becoming compacted. Alliance’s new
product – the Alliance 344 Forestar ELIT – was launched in the
Scandinavian market in September 2018. We call the technology
used in this tire ELIT (Engineered Low Inflation Tire) technology.

Over the period 1990 – 2015,
the world lost an area of forest
equivalent to 129 million hectares

Conventional forestry machinery tires

The newly-developed
Alliance 344 Forestar ELIT tire

Highly-compacted soil

Lightly-compacted soilWith no gaps between the particles of soil, the roots cannot
spread out, and the trees and other plants cannot grow09

In forestry work-sites, the trees tend to be scattered around on
land that often has an uneven gradient and may be boggy and wet.
This makes it very important that forestry machinery can be
operated safely. At the same time, if the downward pressure fromthe tires on the ground is reduced, this can have a negative impact
on driving stability and on fuel economy.

The roots can spread out, so trees and other plants can grow well

TOPICIHX (Internal Heat Exchanger) development

Cool
air

IHX heat exchange
High-temperaturerefrigerant
Low-temperaturerefrigerant
Heat
exchange

Fins

Automotive air conditioner
efficiency enhanced

The IHX forms part of the tubing that delivers refrigerant within a car air conditioning system.
By using coaxial tubing, the IHX is able to utilize the temperature difference between
high-temperature refrigerant in one tube and low-temperature refrigerant in the othertube to perform heat exchange, thereby improving the cooling performance of the air
conditioning system as a whole. Conventional car air conditioning refrigerants are being
replaced by new types of refrigerant to help combat global warming, but the cooling
performance of the new refrigerants is disappointing; IHX technology can help tomitigate this problem. The coaxial IHX developed by Yokohama Industries Americas, Inc.
is designed so that the refrigerant can flow unobstructed even when the tubing is bent,
providing maximum flexibility for tubing layout in confined engine compartments. ThisIHX system has already been adopted for commercial use in North America, andYokohama Industries Americas is working on the development of a new version with aneven more advanced specification.

IHX adoption improves cooling performance by

Four engineers were selected from each of the Alliance Group’s
production facilities and entrusted with the task of strengthening
the tires’ internal steel belts and adjusting the tires’ structuraldesign and tread to reduce the risk of tire slippage. After repeatedexperimentation, the team succeeded in expanding the treadcontact area by 26%, thereby ensuring stable running performancethrough enhanced grip and traction able to cope with high vehicle
weight, and also improving fuel economy by 7%. The self-cleaning
design for keeping dirt off the tire also attracted positive comment;
many forestry industry professionals commented that this new tire
constituted a real “premium tire.”

Tread design

10 – 15%

Tire structure

Optimal lug
angle
Steel cord reinforcement

Optimalrubber compound

Twin beadreinforcement
Increased by 26%
Tread contact area

Comments from the ELIT Project product development teamThe background to this project was the need to reduce soil compaction in forested areas. There
had always been concern that timber procurement was leading to reduction in forest size.
At the same time, it was important that any changes should not have a negative impact
on machinery operators’ comfort or ease of operation. The biggest problem was thus tomeet the various requirements to maintain traction, operator safety, etc. while reducing thedownward pressure exerted by the tires on the ground. We succeeded in developing
technology that allowed the tires to work at an air pressure of 2.5 bar instead of 4.5 bar(representing a roughly 40% decrease in pressure) without negatively impacting the tire’s
load-bearing ability.
We introduced various new design features; in particular, we made substantial changes tobead shape, so as to reduce the stress on the sidewall and prevent slippage. After more than
five years of tread contact area and compressive force evaluation using vigorous dynamic
bending, we were able to develop tires with optimal structure.
Our aim is for these new tires to be used by as many forestry industry professionals as
possible, so that the tires can contribute towards the future growth of the forestry sector by
preventing soil compaction and maintaining the fertility of the soil.

Vered Bluvshtein
Design Development Manager

Lior Vilkomirsky
Technology Manager

Jojan V. Louis
Product Manager

10The Earth

Formulation of Yokohama
Rubber’s Procurement Policy
for the Sustainable Natural
RubberMeasures aimed at realizing stable, sustainable procurement of natural rubber
Working to make natural rubber a sustainable resource
Being able to procure natural rubber in a stable, sustainable manner
is vitally important in order for Yokohama Rubber to be able tocontinue supplying our tires and other products to customers overthe long term. In recent years, there has been a steady rise indemand for natural rubber – which is the main raw material used intire manufacturing – because of the increasing global populationand developments in the mobility sector. At the same time, there are
growing concerns about illegal logging, land grabbing and humanrights abuse, as well as about the negative impact that forest
destruction and illegal logging have on biodiversity.
Recognizing our corporate social responsibility as a tire andrubber manufacturer, in 2017 Yokohama Rubber announced its
support for the goals of the Sustainable Natural Rubber Initiative(SNR-i) advocated by the International Rubber Study Group (IRSG),
and began participating in SNR-i activities. Yokohama Rubber isalso a founding member of the Global Platform for Sustainable
Natural Rubber (GPSNR), initiated by the Tire Industry Project (TIP)of the World Business Council for Sustainable Development(WBCSD), and in October 2018 Yokohama Rubber formulated its
own Procurement Policy for the Sustainable Natural Rubber.
Yokohama Rubber will share this policy across the entire supply
chain with the aim of achieving sustainable natural rubber.

Formulation of Yokohama Rubber’s Procurement
Policy for the Sustainable Natural Rubber
The Procurement Policy for the Sustainable Natural Rubber
specifies matters relating to the establishment of traceability andmatters relating to human rights, labor, environmental protection
etc., including both items to be undertaken by the Yokohama
Rubber Group and items that suppliers will be requested toperform. The Yokohama Rubber Group is also undertaking a
number of independent initiatives in this area, including anagro-forestry initiative by Yokohama Rubber subsidiary Y. T. RubberCo., Ltd. (YTRC) to foster the adoption of sustainable agro-forestry
techniques by farmers living in the vicinity of YTRC facilities, andprojects utilizing the knowhow that Yokohama Rubber has
accumulated through the implementation of the Yokohama
Forever Forest initiative.
(https://www.y-yokohama.com/global/csr/report/partner/)

Overview of the Procurement Policy for
Sustainable Natural Rubber
Enhancing traceability● Prohibition of child labor and forced labor● Protection of high carbon stock (HCS) areas(eliminating forest destruction)● No development of peatlands● Consideration for biodiversity● Abiding by the principle of free, prior and informed
consent (FPIC) in regard to land rights

The natural rubber supply chain

11

TOPIC

Adoption of solar power generation (Yokohama Tire Philippines, Inc.)
The adoption of low-carbon energy sources is vitally important as a response to
climate change. In the first half of fiscal 2019, Yokohama Tire Philippines, Inc.
began adoption of a photovoltaic (PV) solar power generation system, utilizing the
Joint Crediting Mechanism (JCM).
4,000kW (4MW) class solar panels have been installed on the roofs of Yokohama
Tire Philippines’ facility, in the locations that receive the most hours of sunshine,
covering a total area of around 40,000m2. It is anticipated that, once the solar
panels are fully operational, they will provide energy savings equivalent to a
reduction in CO2 emissions of around 2.8kt per year, reducing the Philippines
factory’s annual CO2 emissions by approximately 3.5%.

Realizing a reduction in CO2 emissions of aroundonce the solar panels are fully operational

3.5%

Yokohama Rubber’s future initiatives
The Yokohama Rubber Group has launched a number of innovative
activities aimed at realizing the sustainability of natural rubber. In
Thailand, which is a major producing country of natural rubber, wehave been undertaking joint research on natural rubber withseveral local universities since 2013, and we have also held
Suppliers’ Day meetings with natural rubber suppliers.
Y. T. Rubber Co., Ltd. (YTRC), a natural rubber processing plant
operator which is a member of the Yokohama Rubber Group, has

adopted a cyclic water purification system that recycles the waterused in the plant, and is making a concerted effort to safeguard thenatural environment and maintain the trust of local residents.
In the future, we will be implementing activities based on the
Procurement Policy for the Sustainable Natural Rubber together
with all of our partners in the supply chain, aiming to take
“Promoting CSR activities throughout the supply chain,” which wehave positioned as a key CSR issue, up to an even higher level.

Expectations from an international environmental NGO
The world is still losing natural forests at a rate of 7.6
million hectares per year. One of the reasons for thissituation is the expansion of agricultural and forestry
production; the unsustainable use of forest resources
results in damage to ecosystems and social conflict, andexacerbates the problem of climate change.
Increasingly, companies involved in the procurement of
raw materials that derive from natural resources are©WWF Myanmar
expected to verify the impact on the environment and on
society, and to aim for more sustainable production andutilization. Natural rubber is no exception; there is a movement towards improving traceability of
raw materials, and to minimize, as far as possible, the negative impact of plantation development
and management. Particularly important developments in this regard include the establishment of
the Global Platform for Sustainable Natural Rubber (GPSNR) in October 2018, and the formulation by
many companies – including Yokohama Rubber – of their own procurement policies.
WWF believes that the first step towards implementing sustainable procurement is theformulation of a clear procurement policy, and that this has an important role to play not only inprocurement-related decision-making, but also in regard to engagement with suppliers, investors,
NGOs and other stakeholders. However, the pursuit of sustainable procurement is no easy task, andtakes time to achieve. Having formulated its own procurement policy, Yokohama Rubber could besaid to be on the start-line; in the future, WWF hope that Yokohama Rubber will continue to makesteady progress in implementing this policy through collaboration with its own supply chain andwith the GPSNR, etc.

Ms. Chiaki Furusawa,
Forests Programme,
WWF Japan

12PeopleCreating workplaces where
employees can work with safety
and peace of mind, withthorough disaster-preparedness
measures

Aiming to build workplaces that prioritize employee safety and peace of mind
Creating workplaces where smiles spread
The facilities of the companies that make up the Yokohama RubberGroup have employees of many different nationalities working
there. Our goal is to provide workplaces in which employees with awide range of family structures and home environments can workwith safety and peace of mind, while respecting one another’s
diversity and maintaining harmony with the local community.

Working to strengthen disaster-preparedness measures
Following the fire that occurred at our Philippines plant in 2017, theYokohama Rubber Group immediately launched a general fire risk
inspection of all our production facilities. The inspection results
showed that potential ignition sources, which could lead to fires,
included overheating or short-circuiting of electrical wiring, as well as
sparks created during welding or other work that involves the use offlame; flammable substances were found to include organic solvents,
rubber waste, dust and debris, etc. The inspection results also
provided a reminder of the importance of inspection and cleaning ofareas that may appear clean on the outside, such as the inside of
distribution boards and the inside of dust collector ducts, etc.

Details of the heat sources involved
in incipient fires and fires at
Yokohama Rubber Group facilities(2014 – 2018)

Details of the flammable materials
involved in incipient fires and fires at
Yokohama Rubber Group facilities(2014 – 2018)
Auxiliarymaterials

Other
Electronic heating
and oven equipment
overheating

Coal
Electricalequipment
overheating or
short-circuiting

Static electricity
Frictional Workprocesses
heat(weldingand sanding)

13

When a fire occurs, besides threatening the safety of company
employees, it can also cause worry and inconvenience toemployees’ family members, suppliers and customers. Besides
focusing on safety, every individual employee also needs to pay
more attention to the “3Ss” – “Sorting, Straightening, andSystematic cleaning” (seiri, seiton, seiso) – in order to eliminate small
fire risk. Yokohama Rubber’s corporate headquarters has
formulated global fire prevention guidelines which are applicable
to all Group companies, and fire prevention auditing is being
performed at all production facilities based on these guidelines. In
fiscal 2018, large-scale natural disasters occurred in countries
throughout the world, partly as a result of climate change, andseveral Yokohama Rubber facilities were affected. With the aim oftransforming our facilities into “fire prevention bases” where
protecting the lives of every employee is the key priority, we areworking to strengthen our disaster preparedness by working
actively to identify latent risks and making necessary
improvements in response.

Other

Oil
Grass andwood
Construction
materials
Friction smoke

WiringMaterials
Solvents

Dust anddebrisFire-extinguishing training

TOPIC

Aiming to make Yokohama Rubber a company
where people can continue to work over the long term

Women’s health seminar for female employees

So as to provide support to help employees achieve the right balance between work and theirpersonal lives, Yokohama Rubber is building a working environment that will give employees
greater peace of mind and encourage them to stay with the company over the long term. In 2016,
we established the Women’s Participation and Advancement Taskforce. Besides promoting
women’s participation in the workplace, we are also implementing various measures aimed atproviding the support needed for employees to balance work with childcare or senior care
responsibilities, providing support for female employees’ career development, and strengthening
management of diversified human talent. In fiscal 2018, we held various seminars on balancing
work responsibilities with childcare or senior care responsibilities. We are also implementing
system reforms aimed at making Yokohama Rubber a company that respects different working
styles, and which encourages employees to want to stay over the long term. We have introduced aWorking from Home System, and also a system whereby employees can take annual leave inhourly units; in addition, our Career Return System has been expanded to cover former employees
who left the company because of childcare or nursing care responsibilities and now wish to return.

9 seminars held (with a total of 295 participants)

Working to strengthen safety measures
an unsafe way because of carelessness, or acting unsafely becauseof overconfidence, we are undertaking analysis and implementing
counter-measures with an emphasis on human behavior.
Change in the frequency rate of accidents involving lost work days

Frequency rate of accidents involving lost work days

The Yokohama Rubber Group now has more production locatedoutside Japan than within Japan, and the share of total sales
accounted for by overseas sales is increasing (in fiscal 2018,
overseas sales accounted for 58% of the Group’s total sales).
Implementing the “3Ss” – “Sorting, Straightening, andSystematic cleaning” (seiri, seiton, seiso) – measures and executing
improvement strategies can reduce the incidence of occupational
accidents. At our overseas facilities, focusing on equipment safety
has led to a decrease in the number of serious accidents relating to
production equipment. In fiscal 2018, there was a significant
improvement in the frequency rate of accidents involving lost workdays; the figures for overseas facilities represented a particularlymarked improvement compared to the previous year. With regard
to departments not directly involved in production operations,anticipating the types of risk that employees are exposed to whencommuting or at work, we are working to enhance safety
awareness by means such as having employees recite thecompany’s Safety Chant every day. At the same time, although we
endeavor to ensure that, when problems do occur, employees
follow the “Stop – Notify – Wait” protocol properly, nevertheless,unsafe behavior by employees has become more noticeable
recently. In response to cases of employees handling equipment inBusiness locations within Japan ■Business locations outside Japan ■Rubber manufacturing business (within Japan) ■
0.81

0.8
0.7

0.64

0.65

0.6
0.5
0.39

0.4
0.3

0.30
0.23

0.2
0.1
0

2017

2018

Holding of the 1st Global Safety Managers Meeting
Yokohama Rubber’s first Global Safety Managers Meeting was held in November 2018,bringing together 16 safety managers from 9 different countries. The managers gave
presentations on the safety activities being implemented in Yokohama Rubber Groupfacilities in their respective countries, and each presentation was followed by a lively
question-and-answer session. Following the meeting, the participants were divided
into groups and taken to visit Yokohama Rubber factories in Japan. Even for facilities
using basically the same equipment, there are some facilities that experienced
accidents and others that did not. To find and eliminate the causes of this disparity, we
will make use of these meetings for productive mutual discussion on the measuresthat can be taken in response in relation to equipment and safety training, and we will
disseminate the information obtained in this way as widely as possible.

Participants in the Global Safety Managers Meeting

14

Community

Striving to achieve
harmonious coexistence andshared prosperity with thelocal community

Helping to address social problems in India
Working to ensure the maintenanceof sustainable water resources
The Yokohama Rubber Group has several production and sales
facilities in India. Within India, the maintenance of adequate water
resources to meet both daily living needs and production
requirements is currently a major problem, and will continue to be a
problem in the future. As the population has increased, water
shortages have become an increasingly serious issue, and inability toensure access to safe, clean drinking water has led to many deaths. At
the same time, climate change has resulted in more frequent
droughts, and underground water sources are being depleted.

According to data published by the World Resources Institute(WRI) (Fig. 1), the areas where Yokohama Rubber facilities in India
are located – including Mumbai, Delhi, Dahej and Tirunelveli – areall areas that have a worsening problem with water resources. Our
factory operations in India have adopted water recycling systems
that enable the same water to be used repeatedly, reducing waste
water discharge to zero. To make it possible for local communities
to have access to good-quality water, the Alliance Tire Group
collects rainwater and manages its water quality, before making it
available for use by nearby villages. This measure is expected toprovide the following benefits: (1) The moisture content of the soil
will be increased, which helps to safeguard underground water
resources. (2) Farmers will be able to implement appropriate crop
planting and crop management, leading to increased crop yields.
(3) It will be possible to keep the local ecosystem in balance.

Delhi

Dahej
Mumbai

Tirunelveli

Overall water risk
■ Low risk
■ Low – medium risk
■ Medium – high risk
■ High risk
■ Very high risk
Source: World Resources Institute website(Fig. 1) Level of water risk severity, based on World Resources Institute (WRI) data

15

The launch of the rainwater utilization project

The Yokohama Rubber Group has been participating in theMission Mangroves program launched by NPO United Way of
Mumbai. In the past, there were extensive mangrove forests
growing along Mumbai’s coastline. However, as a result oftree-felling relating to urban development, these mangrove forests
are now on the verge of disappearing. In order to restore themangrove forests to their former condition, various organizations
have been collaborating with 3,700 farms located near the coast,

TOPIC

Mutual support activities involving close inter-factory collaboration,
in response to torrential rains and flooding in Western Japan
In late June and early July 2018, Western Japan was affected by unprecedentedly
heavy torrential rains, which had a severe impact on business activities.
The Onomichi Plant was forced to temporarily suspend operations due toflooding. However, thanks to rapid delivery of emergency materials from thestockpiles of other Yokohama Rubber facilities, we were able to distribute
emergency supplies not only to our employees but also to people in the local
community and to our suppliers located in the area.

Utilization of the volunteer support system

30 projects, with 101 employees participating (Yokohama Rubber Co., Ltd.)
Volunteering activity

400 projects, with 11,304 employees participating (Yokohama Rubber Group)

Providing support for the education of children
in the local community
dividing this area up into management zones and implementing
mangrove tree-planting activities four times a year, with 14
volunteers from the Yokohama Rubber Group taking part eachtime. They also attend mangrove awareness seminars held at local
universities, combining learning with practical activities.

Alliance Tire Group K.K. has positioned environmental protectionand education as the core aspects of its social contribution
activities. The Group’s Dahej Plant in Gujarat State has been
providing educational support for five primary schools in villages
located near the Plant over a period of three years. The Plant has
provided school supplies and uniforms, and has helped the schools
to secure teaching staff and to establish a digital learning
environment. To improve the teaching skills of the schools’
teaching staff, workshops on teaching methods are held. So far,this program has contributed towards providing learning
opportunities for 130 children.

Employees taking part in the Mission Mangroves program

Educational support project for primary schools

Comments from employees affected by the heavy torrential rains that Western Japan experienced in 2018
The Onomichi Plant,
which was flooded
The flooding that resulted from therecent torrential rains caused damage
to the homes and cars of Plant
employees.
We experienced just how destructive
nature can be, but at the same time wealso benefited from the kind-hearted
support provided by other YokohamaGroup employees, for which we are
Masahiro Iidavery grateful. I would like to take thisPlant Manager, Onomichi Plant
opportunity to express my sincere
thanks for their assistance.

The Mie Plant,
which provided support
As soon as we learnt, throughinter-plant communication, that theOnomichi Plant had been forced tosuspend operations because offlooding, I discussed the situation with
our plant’s safety managers and others,
and decided to provide support for theOnomichi Plant immediately. This
prompt action is attributable to theawareness that is fully shared among
our own employees of the need to help
others when they are in difficulty.

Takehisa Morimoto
Plant Manager, Mie Plant

16

Communication with Experts
Initiatives to foster diversified work styles
Interviews were held with all female employees and managers who
supervise female employees at Yokohama Rubber. As a result, weunderstood that there are needs to support different ways ofapproaching work and workstyles, and accordingly we set the basic
policy of “Aiming to be a company that welcomes diverse
workstyles, with an employee-friendly working environment thatwill encourage employees to serve long term” and developed
measures to implement this policy. Going forward, we aim to createa more employee-friendly working environment by strengthening
management capabilities and creating a culture that supports theactive participation of not only women, but each and every
employee with a diverse set of values so that they can perform to
the best of their ability. During fiscal 2018, we invited experts to
conduct 9 seminars for female employees and management on thepriority areas of childcare, nursing care, and women’s career
continuity that were participated in by 295 people.
In addition, a questionnaire aimed at gaining an understanding of thecurrent status of nursing care was conducted with all of ourapproximately 5,500 employees, and a response was received from 91%.

We understood that there were various needs including
responding to concerns toward nursing care and providing an
understanding of institutions. We also directly asked about actual
experiences and request for nursing care from willing participants,
and summarized the issues related to nursing care.
A nursing care seminar for managers was held for the purpose ofproviding suggestions for consultations from subordinates who are
faced with nursing care and preventing resignations due to nursing
care. A contact point on childcare and nursing care was set up in 2019.
Nursing care questionnaire
There is a possibility of nursing care in the next 5 years (60%)
I feel uncertain toward nursing care (90%)● I’m not sure whether I can continue working during nursing care(80%)
● The thing employees felt most uncertain about was “Don’t know
about public institutions”● The most desired work style was “Balance between work andnursing care”●●

Holding Seminars with External Experts
Ms. Sook Ja Park who is engaged in employee awareness reform
and work style reform for employees was invited to hold an
unconscious bias seminar for managers. Participants learned about
the unconscious biases everyone has and strengthened their
management and risk management skills. In addition, the original
supportive boss lecturer Mr. Takayuki Kawashima was invited tohold a seminar on improving development capabilities for diverse
subordinates, and participants learned about the importance ofeffective communication with subordinates and building strongorganizations to improve the results achieved by organizations. For
female employees, in addition to seminars for learning about acareer balance from a long-term perspective, a seminar for
employees returning from maternity and childcare leave, an
encourage for women seminar on finding a happy career and role
while understanding the changes in the times, and a women’s
health seminars aimed at having a long and healthy career were
held to improve motivation.
Seminars on diverse working style (times held)
102017 ■ 2018 ■ 2019 (scheduled) ■
8
6
4
2
0
Childcare
Nursing care

CareerSeminars held, applicable employees are in the parentheses
Childcare●

Working mother information exchange meeting (women)
Seminar for employees returning from childcare leaveseminar (balance with childcare)

Nursing care●

Nursing care seminar for managers (2 times) (managers)

Career●●Unconscious bias seminar (managers)
Seminar on improving development capabilities for diverse
subordinates (managers)● Encourage seminar for women (women)● Women’s health seminar (women)●

Seminar on improving development capabilities for diverse subordinates

Overseas office observation by Ms. Joanna Sook Ja Park
This year marks the 13th year since the establishment of Yokohama
Tyre Vietnam Inc., and it has 6 Japanese employees including thepresident among a total of 612 employees. Many of its executives are
local staff members. Although the majority of production site staff
are men and the percentage of women in production site jobs is13%, women account for 22% of management positions. Womenaccount for 40% of division manager positions, and women are
remarkably active in leadership positions. A meeting participated inby management and all union members is held once per month to17

hear opinions, requests, andcomplaints on work safety and thework environment, and a healthy
relationship has been maintained
as a result. Ms. Park expressed thehope that these initiatives are
conducted in an ongoing manner
for improvements of theworkplace.

Plant observation

Third-party Opinion
This opinion has been written based on the contents of this report, interviews held with people at Yokohama Rubber, and field observation.

Ms. Joanna Sook Ja Park
Appassionata, Inc. President and Consultant
Appassionata was established in 2000 to promotea work-Life balance and diversity. Appassionata
has supported many companies with humanresources development and awareness reform inareas such as unconscious prejudice, diversity,and telework (working from home).

Corporate governance: I commend the increase in the number ofnonexecutive officers as a part of officer structure reform year by
year. On the other hand, I look forward to communication on the
check function including evaluations of the effectiveness of theBoard of Directors.
Compliance: I commend efforts to strengthen global governanceincluding the start of the introduction of whistleblowing systems atoverseas business locations. In addition, I look forward to the further
implementation of education for compliance officers and risk
assessment in order to build a solid compliance structure.
Contribution to resolution of social issues through SDGs:
I commend initiatives in response to social issues including thedevelopment of agricultural and forestry tires, the pursuit of safety indriving during rainy weather, and the sustainable procurement of
natural rubber. In addition, in response to investment in thesustainability of companies (ESG investments), I hope that Yokohama
Rubber presents its long-term vision, for example, the vision aimed
for in fiscal 2030, and reports the progress as financial andnon-financial information through a variety of forms of media.
Work style initiatives: An employee awareness survey andinterviews with all female employees were conducted in Japan, andvarious measures were adopted in fiscal 2018 at a fast pace in
response to childcare, nursing care, and careers for which there werestrong needs based on the results of the survey and interviews. The
satisfaction of participants in the education and training that washeld was at least 90%, and I commend the quality that has been
secured. What should be focused on in particular is the field survey
and interviews with all employees. The careful analysis, careful
identification of current challenges, and holding of seminars led toan improved awareness of nursing care.
Participation of diverse human resources: Yokohama Peer
Support Co., Ltd. that promotes the employment of people withdisabilities has fulfilled the social responsibility of the Yokohama
Rubber Group as a specified subsidiary while providing work
according to the characteristics of individuals and improved theworking environment through regular individual interviews. I hopethat a safe and cheerful working environment is maintained going
forward, including response to the aging of the population.
At the Nagano Plant where hydraulic hoses are assembled, there isa variety of people working including re-employed people, contract
employees, people with disabilities, and foreigners, and because theproduct handled are relatively light, the plant has the highest
percentage of female workers. As there are some processes that are
conducted only by part-time employees, I commend the progressthat has been made with improvements in operational efficiency. On
the other hand, I hope that diverse employees including women andforeigners are assigned work that comes with responsibilities.
Activities for employees: In addition to events to deepen
communication and friendships among employees including dinnerparties and commemorative gift ceremonies that are held at all
offices, events such as family day and children's day that value
families and children as well as employee trips are held on a regularbasis, and I commend how this contributes to improvements in
employee satisfaction and retention rates.
In addition, emergency response drills in the light of the fire at theplant in the Philippines and study meetings on compliance, theenvironment, safety, and quality are regularly held, and I commend
these efforts to raise awareness and train employees on theenvironment, safety, and compliance. I hope that efforts to promotedisaster prevention systems, workplace safety and health, andhealthy lifestyles will continue to go forward.
Coexistence with local communities: The Nagano Plant is engaged
in river cleaning and forest conservation activities as part of its CSR
activities, and is also active in the fire brigade. Production bases also
contribute to environmental preservation and raising an awarenessof the environment among children through regional tree planting
activities, as well as various traffic safety awareness PR activities.
Other efforts include campaigns for distributing safety stickers todrivers, lessons and games that teach traffic rules to children, and theprovision of opportunities for guardians to learn about the necessityof tire replacement and how to conduct periodic inspections.
I hope that Yokohama continues to create workplaces where all
employees can work safely and with a peace of mind while
contributing to the local community.

Response to Third-Party Opinion
Thank you for taking a careful look at our working sites anddepartments. We will carefully consider your feedback and use it formaking improvements.
The most important thing for us to do to ensure that we canimplement business activities without delay in accordance with the
GD2020 medium-term management plan is to create workplaces
that enable the diverse human resources of the Group to feel secure
and perform to the best of their abilities. Therefore, we will further
promote the creation of workplace environments that allow
employees to work in a safe and healthy manner, including safetyand disaster prevention. Meanwhile, we will listen to the opinions of
employees and family members as well as experts and provide
information frequently as we create systems that allow employees tocontinue working over the long term without resigning due to family
circumstances. Understanding the relationship between the SDGs
and our business is essential for achieving the CSR slogan of “Caring

for the Future”. The SDGs aim for an era that is good not only for thethree parties of sellers, buyers, and society, but also good for the
future and for the Earth. We will ensure that each and every
employee understands this, and strengthen efforts that include theprovision of environmentally friendly products and coexistence withlocal communities. Moreover, we will disclose information on thevision we aim for in the future and theprogress being made on that path in orderto gain the trust of shareholders. Further,
we will contribute to the resolution of social
issues by carrying out business operations
hand-in-hand with business partners andstakeholders from the local community.

Shigetoshi Kondo
Officer, Head of Corporate Social Responsibility Division18

Business and Main Products of Yokohama Rubber
The Yokohama Rubber Group aims to achieve its basic philosophy “to enrich people’s lives andcontribute to their greater happiness and well-being by devoting our wholehearted energies
and advanced technology to the creation of beneficial products.” We will communicate joy to
our stakeholders and gain their trust through business growth strategies that evoke a
distinctive identity unique to Yokohama Rubber.
The strategies and initiatives in each field are as follows
Through quality and performance to “Help consumers get more out ofConsumer
motoring lifestyles” with a focus on premium car tires, winter tires, and hobby
Tires
tires, we deliver safer and more enjoyable driving.
Commercial
Tires
MB
Operations

Others 9 billion yen (1.4%)

ATG

68.7 billion yen(10.6%)

MB

117.8 billion yen(18.1%)

Sales revenue
by business(FY2018)

We have expanded off-highway tires and truck and bus tires to contribute to
the sustainability of industries and improvements in mass transport efficiency.
We aim to establish a firm position in the automotive components business andmarine products business that will lead to the next generation by exploiting
compounding and compositing technologies that we are strong in.

Tires

454.8 billion yen(69.9%)

Tires[Principal products] Production and sales of tires for passenger cars and light trucks; for trucks and buses; for construction and mining
equipment; and for motor sports and tire tubes, aluminum alloy wheels, and other peripheral products▶ BluEarth– GT AE51 tire for passenger cars

▶ 710R all-season tires for trucks and buses

We have integrated high handling stability and fuel efficiency using thefoundation design for the global tire brand BluEarth that is based on
the theme of “tires that are friendly to the environment, people, andsociety” through further improvements in environmental performance.
Something we have focused on in particular is safe driving during rainy
weather. The amount of rainfall in Japan is approximately 2 times theglobal average. It has been said that there are approximately 4 times the
traffic accidents on rainy days compared to sunny days. We became thefirst in the industry to get the highest grade of “a” in wet grip performancefor sizes over 300 in Japan in the tire labeling system. Yokohama Rubber
offers safer driving through tires that won’t slip even on wet road surfaces.

Abrasion resistance and wear resistance havebeen significantly improved compared to before,
the tires excel in rain and snow performance, andtransport economics have been enhanced. In
addition, grip strength when empty and drainage
performance have been improved to eliminate
the anxiety of drivers toward slips when starting
during wet conditions.

Comparison of number of accidents in sunny and rainy weather▶ iceGUARD studless iG60 Z・P・S runflat tires(FY2017)

Approximately

4 timesthe number of traffic
accidents per hour
during rainy weather
compared tosunny weather

1.06 cases/hour
Sunny weather

Number of traffic accidents per hour(cases/hour)

Number of accidents

4.0 cases/hour

We launched an additional runflat model ofstudless tire (with Z.P.S. mark).
These tires have achieved a lighter weight whilestrengthening the side wall of the tire so that thevehicle can be supported even when there is no air.
The tires offer safer driving during high speed
driving and on snowy roads.

Rainy weather* From the website of Metropolitan Expressway Company Limited

There is so much of a difference
between “a” and “c” wet performance

Difference in braking distance depending on the grade*Speed is 100 km/h

This gap isreassuring

19▶ AICHI E-Cushion tires for industrial vehicles

Aichi Tire Industry Co., Ltd. manufactures and sells
tires for industrial vehicles.
These tires achieve both abrasion resistanceand comfortable ride, contributing to economy
and the reduction of operator’s fatigue.

MB (Multiple Business)[Principal products] Production and sales of hoses, couplings, conveyor belts, fenders, adhesives, sealants, and other products for industrial,
maritime and aerospace fields.

▶ Car air conditioner hoses that support next-generation coolant▶ ECOTEX energy-saving conveyor belt

Although HFC-134a coolant that is currently the mainstream for car air
conditioning has a high global warming potential (GWP) of 1,430, the
new HFO-1234yf coolant has an extremely low GWP of 4, so
replacement can be expected. However, because this new coolant iscorrosive, we have improved our hoses in response. Rubber on the
inner surface prevents corrosion of the resin layer and coolant leakage.

ECOTEX was used in the longest conveyor line in Japan in recognitionof its energy savings and high durability. The viscoelasticity of thebottom facing cover rubber that comes into contact with the roller has
been optimized to reduce the resistance when going over the roller
and contribute to a reduction in conveyor power consumption. A
significant reduction in power consumption of at least 50% compared
to before has been achieved.
General cover rubber

Belt advancing direction

ECOTEX cover rubber

High resistanceResin

Reinforcing
layer
Rubber onouter surface

Rubber on
inner surface
Rubber in
the middle

Belt advancing direction

Belt▶
Roller▶

Low resistanceBelt▶
Roller▶

ATG (Alliance Tire Group K.K.)[Principal products] Production and sales of tires for agricultural, industrial, construction, and forestry machinery▶ FarmPRO Radial 80 tires for agricultural and forestry machinery▶ 317 MPT tire for construction and industrial vehicles

Alliance Tire Group K.K. has provided tires for agricultural machinery
such as tractors and forestry machinery under brands including theAlliance brand for over 60 years.
FarmPRO Radial 80 is engineered with a multi angle lug design withsteep angles at the center that enables a smooth ride along with
self-cleaning characteristics. The shallow angle at shoulder provides
superior traction.

This new product has been introduced and well received after being
designed and developed in response to feedback from customers.
The 317 MPT tire has been designed for construction and industrial
vehicle application that require high traction, and excels in high-speed
driving and driving force. The tire has a strong nylon carcass
construction to achieve the best performance during bad weather nomatter what road conditions are like.

20

Yokohama Rubber Group at a Glance (Consolidated as of December 31, 2018)
Number of employees

Number of applicable subsidiaries

26,274

123

Sales revenue (JPY million)

Profit before tax (JPY million)

650,239 million yen

49,941 million yen

Non-financial indicators
The Earth
CO2 emissions and year-to-year comparison*

371 thousand tons (2% up)
Scope 2 349 thousand tons (1% down)
Scope 3 22,055 thousand tons (5% down)
Scope 1

Number of trees and seedlings planted(aggregate)

943 thousand(Trees: 564 thousand,seedlings provided: 379 thousand)

Percentage of environmentally friendly products(Ratio of sales of fuel-efficient tirefor passenger vehicles)

Agroforestry efforts

89.9

farms
(approximately 104 hectares)

Percentage of womenon the management career path

Employment of people with disabilities

23 % (non-consolidated)

2.18 % (28) (non-consolidated)

Disabling injury frequency rate

Ratio of surveys on child labor andforced labor on new business partners

0.36 (domestic 0.30, overseas 0.39)

100 %% (3% up)
(Summer replacement tires/non-consolidated)

40

Society*1: Scope 1 is CO2 emissions from the use of fuel, Scope 2 is CO2 emissions from the use of electricity. Scope 3 is CO2 emissions throughout the value chain from procurement to product use and disposal.

21

Main Regions Where Yokohama Rubber Is Developing Its International Operations
Business is conducted in

29 countries

Europe14
Number of people: 1,123

North America

11
Number of people: 2,805

Major business sites:

Major business sites:

Japan

35
Number of people: 10,188
Major business sites:

Asia

29
Number of people: 11,895
Major business sites:

Latin America

3
Number of people: 263
Major business sites:

Sales by Region

Change in sales ratio
Japan

Others110.1 billion yen(16.9%)

Japan

273.0 billion yen(42.0%)

Asia
93.2 billion yen(14.3%)

Overseas
(%)
100
90
80
70
60
50
40
30
20
10

Sales byCustomer Location(FY2018)

North America
174.0 billion yen(26.8%)

0

49.8

52.8

52.1

58.6

58.0

50.2

47.2

47.9

41.4

42.0

2014

2015

2016

2017

2018 (FY)Net Sales (consolidated) and Profit
Attributable to Owners of Parent

Total Assets and Equity Ratio (consolidated)

Net Sales (Japanese Standards)
Sales Revenue (IFRS)Profit Attributable to Owners of Parent (Japanese Standards)
Profit Attributable to Owners of Parent (IFRS)

Total Assets (Japanese Standards)
Total Assets (IFRS)
Equity Ratio (Japanese Standards)
Ratio of Equity Attributable to Owners of Parent (IFRS)Sales Revenue

Profit Attributable to Owners of Parent*1

Total Assets(JPY billion)(JPY billion)(JPY billion)

700
600

40.5
629.9
625.2
596.2
574.0
36.3

668.1

650.2
646.3
40.0

35.2

35.6

500
400

45

1,000

40

900

35

800

30

700

25
18.8

300

20
15

200

9.4

10

100

5

0

0

2014 2015

2016

2017

2018 (FY)*1: Profit Attributable to Owners of Parent under IFRS

Equity Ratio*2
(%)
44.1

47.7

734.5 710.7

903.0 888.9

38.6 38.1

929.0 920.8
41.3
41.3

50
855.8

45

43.7

40
35

600

30

500

25

400

20

300

15

200

10

100

5

0

2014 2015

2016

2017

0
2018 (FY)*2: Ratio of Equity Attributable to Owners of Parent under IFRS

22The Yokohama Rubber Co., Ltd.
36-11, Shimbashi 5-chome, Minato-ku, Tokyo
105-8685, Japan
Corporate Social Responsibility Planning Department
Tel. +81-3-5400-4705
Corporate Communications Department
Tel. +81-3-5400-4531

Keeping a positive contribution to both tire safety and local communities
Since 2015, when the partnership with Chelsea Football Club began, the clubs social responsibility programme, the Chelsea
Foundation, has been supporting Yokohama and their CSR initiatives across the globe. The Chelsea Foundation uses the power offootball and sport to motivate, educate and inspire. One of the Foundation’s core activities is hosting football-coaching events foryoung people in their communities.
During the 2017 -2018 season, the Chelsea Foundation continued to support Yokohama’s community activities using its
International Development coaches to provide soccer schools for local children in locations near the tyre company’s facilities aroundthe world, including Qatar, Italy, Russia, U.S.A., Vietnam and Japan. Hundreds of children have participated in activities, such assoccer schools and classroom workshops, and all have benefitted from the opportunity to learn both footballing skills as well asother important positive life lessons. The Yokohama x Chelsea Foundation activities also provide significant local media exposure,helping to raise YOKOHAMA’s brand awareness in key markets.
YOKOHAMA together with the Chelsea Foundation continues to support the clubs first community development project in the
US, New York’s FC Harlem. The initiative is offering opportunities for young people with low economic means to access soccer in asafe environment.
In the U.K., YOKOHAMA has also continued to collaborate with Chelsea to remind fans of the importance of vehicle safety
inspections. In partnership with the UK road safety charity `Tyre Safe´, advertising on match days at Stamford Bridge highlights to the
public the need for regular tyre safety checks. YOKOHAMA will continue to collaborate with Chelsea FC in the future, endeavoring to
make a positive contribution to both tire safety and local communities.

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Soccer schools(Left) Ho Chi Minh City, Vietnam(Right) Harlem, New York, U.S.A.

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Yokohama Rubber is a signatory to the United Nations Global Compact.
Yokohama Rubber is an advocate of Fun to Share, a climate change program working to realize a low-carbon society.
Yokohama Rubber Group is an official partner of Chelsea F.C.