Integrated Report 2024
A Review of the 2023 Fiscal Year2

THK Integrated Report 202 4

Basic Sustainability Policy
The THK Group aims to both enhance corporate value through its core business and contribute to the creation of asustainable and affluent society by carrying on its founding spirit, the Corporate Philosophy, from generation to generation, developing business activities that embody the Corporate Basic Policies in good faith and practicing voluntaryactions based on the Action Charter.

Corporate
Philosophy

Providing innovative products to the world and generating
new trends to contribute to the creation of an affluent society.

Corporate
Basic Policies

1. Creating value and contributing to society
2. Being customer-oriented
3. Compliance with laws and regulations

Action Charter

Ten principles of behavior set forth for the THK Group to promote social and economic development as it becomes invaluable to society and shoulders social responsibility basedon high ethical standards to create a sustainable society.
These principles cover subjects that form the standard of how
we execute our daily work, such as compliance, environmentalism, and respect for human rights.

Company Overview
Trade name:

THK CO., LTD.

Established:

April 10, 1971

Headquarters:

2-12-10 Shibaura, Minato-ku, Tokyo 108-8506

Report Overview
Reporting period: January 1, 2023, to December 31, 2023 (including activities before and after this period)
Published:	Annually in Q3
Scope:	THK CO., LTD. and its consolidated and unconsolidated subsidiaries
(Individual data scopes are given in the report)
References:	This Integrated Report was compiled in accordance with the International Integrated Reporting Framework
developed by the Value Reporting Foundation (VRF); the Guidance for Integrated Corporate Disclosure andCompany-Investor Dialogue for Collaborative Value Creation formulated by the Japanese Ministry of Economy,
Trade and Industry; and the GRI Standards. A detailed table cross-referencing our reports against the GRI
Standards is available on the THK website.

3

Contents
Basic Sustainability Policy

2

Contents

3

About THK
THK’s History
At a Glance

4
6

Messages from Executive Management
Message from the Chairman and CEO
Greetings and Goals from the President and COO

14
16
18
20

Procurement
CSR Procurement Guidelines
Quality Assurance: Trust, Reliability, and Safety
Shareholders and Investors
Health and Safety
Human Rights
Human Capital

50
51
52
53
54
56
58

Harmony with the Environment

Growth Strategies
Growth Strategies to Expand Business Domains
Increasing Corporate ValueBusiness Strategy: Industrial Machinery BusinessBusiness Strategy: Automotive and Transportation
Business
DX Promotion and Planning

22
24
26

Outside Director Interview

32

28
30

GovernancePrincipal Risks and THK’s Response
GovernanceInternal Audit and Internal Controls

42
44
45
46
47
48

Involvement in Society
8
12

Value Creation
Value Creation
Management Capital
Relationship with Stakeholders
Material Issues and KPIs

Compliance
Anti-Bribery
Information Security
Risk Management Structure
BCP
Directors and Executive Officers

36
38
41

Environmental Management
TCFDWorking toward Carbon Neutrality
Environmental Impact Overview
Zero Emissions and Hazardous Material Management
Activities
External Certifications

60
61
62
63
64
65

Data Section
Financial and Non-Financial Highlights
Consolidated Financial Statements
Subsidiaries & Affiliate
Corporate Data

66
68
79

Preface
On January 1, 2024, as Akihiro Teramachi (former President) assumed the position of Chairman and CEO, Takashi
Teramachi (former Director and Senior Managing Executive Officer) assumed the position of President and COO,
thereby inaugurating our new management structure for the next generation.
Within the THK Integrated Report 2024, Chairman Teramachi speaks about the results of the second year moving
toward our 2026 management targets, and President Teramachi discusses our goals and future initiatives in the Messages from Executive Management section. Then, in the Governance, Involvement in Society, and Harmony with theEnvironment sections, we summarize the details of our current ESG initiatives while highlighting activities conducted
in 2023.
In order to maintain the trust and fulfill the expectations of each of our stakeholders, we will continue to pursue
various initiatives and proactively disclose information. Furthermore, details of ESG activities being carried out at eachlocation are posted on our website, so please take a look.

4

THK Integrated Report 202 4

THK’s History
Since its founding in 1971, THK has introduced numerous innovations to the world as a company focused on creation and development guided by
the corporate philosophy of providing innovative products to the world and generating new trends to contribute to the creation of an affluent society.
As we enter into a time when the business environment changes rapidly, we will move forward with various initiatives to achieve long-term growth,
increase our corporate value, and promote the creation of a sustainable society, and in doing so, satisfy the expectations and trust of our stakeholders.

1971 THK established	Began sales of Link Ball Model
RBL	Began sales of Ball Spline
Model LBS
1972	Began sales of first LM Guide,
the Model LSR
1977 Established Kofu plant1979	Began sales of Ball Screw
Model BN1981 Established THK America, Inc. (USA)1982	Began sales of Global Standard Size
LM Guide Model HSR	Began sales of Cross-Roller Ring
Model RB	Established THK Europe GmbH
(Germany)
1989	Established THK TAIWAN CO., LTD.
(Taiwan)	Debuted on the over-the-counter
stock market

1990	Began sales of LM Guide Actuator
Model KR
1996	
Established DALIAN THK CO., LTD.
(China)	Began sales of Caged Ball LM
Guide Model SSR
1997	Established THK Manufacturing ofAmerica, Inc. (USA)1998	Began sales of Linear Motor Actuator Model GLM

3/1972–3/1990: Non-consolidated net sales
3/1991–12/2023: Consolidated revenue
3/1972

3/1980The Early Years

Headquarters at THK’s founding (Meguro ward, Tokyo)

3/1990

Advancing into Global Markets

Model LSR, the first LM Guide

THK America, Inc., the first sales office outside of Japan

1971 onward

1972 onward

1981 onward

Foundation

The Birth of the LM
Guide

Establishment of Locations Outside of Japan

THK was established in Tokyo’s Meguro
ward under the name Toho Seiko Co.,
Ltd. by founder Hiroshi Teramachi just as
Japan’s economy was at a major turning point with the waning of the Izanagi
boom and the transition to a floatingexchange rate. The three-letter brand,which would later become the company’s name, was made to represent threeessential philosophies for manufacturing:
T for Toughness, H for High Quality, andK for Know-how. It was imbued with theidea that THK products would be toughand long-lasting, of the highest quality inthe world, and beneficial for the generation of new know-how.

The LM Guide Model LSR debuted in1972 as the world’s first rolling component for linear motion in machines. It
was later adopted by a U.S.-based pioneer of the machining center and worldclass machine tool manufacturer of itsday, which served as the catalyst for its
increased use in machine tools. Further
evolution and expansion were achieved
through the development of the Global Standard Size LM Guide Model HSR
in 1982 and the Caged Ball LM Guide
SSR in 1996.

As global manufacturing developed andworldwide demand for THK products
grew, the Company sought to transition
to an integrated sales and production
structure to localize both sales and production of its products based on the basic
concept in global manufacturing that thelocation of demand is the best location
for production. Starting with the establishment of a sales office in the United Statesin 1981 and a production facility in China
in 1996, THK quickly made inroads into
the Americas, Europe, China, and the restof Asia, predicting that a vast potential
market lay waiting outside of Japan.

Messages from
Executive Management

About THK

Value Creation

2000	Established THK Manufacturing of Europe
S.A.S. (France)
2001	THK listed on the first section of the Tokyo Stock
Exchange (TSE)	
Began sales of Caged Roller LM Guide Model SRG
2003 Established THK (SHANGHAI) CO., LTD. (China)
2004	Established THK MANUFACTURING OF CHINA(WUXI) CO., LTD. (China)
	DAITO SEIKI CO., LTD. (now THK INTECHSCO., LTD.) became subsidiary company
2005	Established THK MANUFACTURING OF CHINA(LIAONING) CO., LTD. (China)
Established THK (CHINA) CO., LTD. (China)
2006	
Established THK LM SYSTEM Pte. Ltd. (Singapore)2007	Began sales of Seismic Isolation Table Model TSD	Acquired all shares of RHYTHM CORPORATION(now THK RHYTHM CO., LTD.)	Established THK RHYTHM (THAILAND) CO.,LTD. (Thailand)2008	Established THK MANUFACTURING OF VIETNAM CO., LTD. (Vietnam)

Growth Strategies

Outside Director Interview

5

Revenue2011	Began sales of Super-Low Waving LM Guide Models SPR(¥1 million)
and SPS
Established THK RHYTHM CHANGZHOU CO., LTD. (China)
400,000	THK RHYTHM MALAYSIA Sdn. Bhd. (Malaysia) became
consolidated subsidiary company
2012 Established THK RHYTHM MEXICANA, S.A. DE C.V. (Mexico)
350,000	Established THK MANUFACTURING OF CHINA (CHANGZHOU) CO., LTD. (China)
Established THK India Pvt. Ltd. (India)
300,0002015	Acquired the European and North American L&S businessfrom TRW Automotive Inc. and established THK RHYTHM
AUTOMOTIVE (TRA)
250,0002017	Began sales of Low-Torque Shaft Unit for Vertical-Axis Wind
Turbines Model WLS
Launched Omni THK
200,000
Established TRA Holdings CO., LTD. (Japan)
2018 Began sales of Ball Screw for Electric Integrated Brake Control
2020	Began accepting official orders for OEE Optimization System
150,000

2021

Began sales of autonomous transfer robot SIGNAS
Began sales of the SEED-R7 series of SEED Platform Robots
100,000

Due to the change in the fiscal year period, the 2017 fiscal year data reflects a modified reporting period that includes 9 months from consolidated companies whose fiscal years ended

50,000in March and 12 months from consolidated companies whose fiscal years ended in December.
The THK Group decided to adopt IFRS beginning with the 2019 fiscal year. For the purposes of comparison, the results for the 2018 fiscal year are also noted in accordance with IFRS.
0
3/20003/20103/2017
Fiscal years ended March 31

Development of New Business Areas

Diversification

12/2023

Fiscal years ended December 31

Toward a New Era

Change in Business Style

Corporate Philosophy
Vision:Transform into a manufacturing andinnovative services company

tionbalizall-Scale Glo

Fu

Deve
New lopmenBusitnessofAreasExpansion of Business Areas

Sustainability and ESG

Seismic Isolation System Linear Re-circulating
Guide Model CLBOEE Optimization System

THKʼs business1999 onward2017 onward

2022 onward

Expansion of BusinessDomains

Service Launch of Omni
THK andTransforming into a Manufacturing
and Innovative Services Company

Reasoning that combining existing technologies to broaden the range of applications for its products would enable the expansion of demand in various fields, THK,
which had to this point been honing its
production technology and product performance by competing primarily in the arenaof machine tools with their strict operating
conditions, began to develop into new
business areas. Starting in 1999, THK set
up specialized business divisions for automotive components, seismic isolation/
damping systems, electric actuators, andunit products as the Company worked to
expand from capital goods into consumer(household) goods by promoting the development and supply of new products.

Omni THK, a platform for communicating with customers that launchedin 2017, is a service that makes a wide
range of information that customers
need for selecting and purchasing products available online and generates newvalue for the customer experience. TheOEE Optimization System,
which began service in 2020, visualizes
product status and provides solutions
for reducing various types of loss that
customers experience on the production floor.

As the business environment around uschanges dramatically, we are transforming ourselves into a manufacturing andinnovative services company. Instead ofsimply creating things, we will expand
our business to include everything frombefore to after the sale. THK will continue to provide products and services
with high added value for customers
as a services company that makes andprovides products, but is not limited to
manufacturing alone.

6

THK Integrated Report 202 4

At a Glance
Business Overview
2023 Consolidated Revenue:¥351.9billionYear on Year:■ Industrial machinery■ Japan■ Automotive andtransportation■ The
Americas■ Europe

Automotiveandtransportation

38

Revenuebreakdown
by businesssegment(%)■ China

Asia
and
other

62

7

China

17

■ Asia andotherIndustrial
machinery-10.6%

Japan

31

Revenuebreakdown
by region(%)

Europe

20

The
Americas25

Industrial Machinery Business

Revenue:¥217.5billion Year on Year:

Automotive and Transportation Business¥134.4-22.9%

Revenue:

The industrial machinery business supplies the LM Guide andother products that are essential components of industrial machinery such as machine tools and semiconductor manufacturing
equipment. With a focus on product development, this segment
contributes to increasing the precision, rigidity, and high-speed
performance of industrial machinery, while also addressing theautomation needs of production lines.

billion Year on Year:+20.4%

The automotive and transportation business segment proposes andadds new products in line with CASE and MaaS in addition to its traditional linkage and suspension business. It develops next-generation products and provides solutions that fully capitalize on the technology and know-how that THK has cultivated since its founding.
* The numbers for the automotive and transportation business are the combined
values from THK RHYTHM and THK RHYTHM AUTOMOTIVE.

Revenue and Number of Employees per Region

EuropeChina

Asia and otherJapan

The Americas¥69.8 billion¥59.9 billion¥25.0 billion¥108.7 billion¥88.3 billion

1,798

3,091

888

5,652

1,931

About THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

THK by the Numbers (2023)

Ratio of revenue fromoutside of Japan

69.1

%

64.2

%

Consolidated employees

13,360Intellectual property holdings(Holdings outside of Japan)

PublishedbillionRatio of equity attributableto owners of the parent

30.7

2,487
403

¥28.7

* Property, plant, and equipment investments only

Payout ratio

Registered

Capital investments(1,673)(315)%

Ratio of employees
outside of Japan

57.7

%

R&D expenses¥5.6

billionTotal assets¥556.3billionGlobal presence

25

countries

Sales facilities: 22
Production facilities: 14
Development facilities: 3

Employees certified with National
Trade Skill Test & Certification

Solar power generated(Production departments at THK and Group locations in Japan)

10,87564peopleMale: 51
Female: 13

p. 62-63

MWh

Locations with newly installed solar panels: 4
Total facilities with panels: 107

8

THK Integrated Report 202 4

Messages from Executive Management

Increasing Corporate Value over the Medium
to Long Term

Akihiro Teramachi

Takashi Teramachi

Chairman and CEO

President and COO

About THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

9

Akihiro Teramachi
Chairman and CEO

Message from the Chairman and CEO

Rapidly Creating Value as a Manufacturing and Innovative
Services Company on a Global Scale under a New Structure
Introduction
I would like to express my sincere condolences for the lives
that were tragically lost and to everyone in the region affectedby the Noto earthquake that struck at the start of 2024.
We provided a donation to the Japanese Red Cross at the
beginning of January, and we sincerely hope that it will aid
the speedy recovery of the affected areas in some small way.

Selecting Our New President
At the November 2023 Board of Directors Meeting, we
made the decision to have then-Director and Senior Managing Executive Officer Takashi Teramachi assume the roleof Representative Director, President, and COO, while I assumed the role of Representative Director, Chairman, andCEO. This new structure took effect on January 1, 2024.
Our new President Teramachi has been promoted to thisposition at the age of 45. Reflecting on my own experience, I
was also 45 when I became the president, but I felt that I had
been prepared for management through the previous work
innovations that I had spearheaded. In addition to leading
our organization while serving as the president of a subsidiary and heading the industrial machinery business, our new
President Teramachi has been responsible for promoting DX(digital transformation) and GX (green transformation), andthis work has prepared him for his role in steering us into a
new era. In fact, as I would discuss the future of our operations with him, it became clear what our key strategies mustbe, and he demonstrated a desire to drive innovation andadapt to our changing environment. That was why I decided

this was the time to pass the torch to the next generation,
and after I investigated the matter and held deliberations with
the Nomination Advisory Committee, our new President Teramachi was selected for this position at the Board of Directors
Meeting. I will continue to support our new structure in mycapacity as CEO.
My hope for this new structure is that we will continue topreserve the good things we have adopted over the years
while also boldly revolutionizing to adapt to the changing
times. It is especially imperative that we further our globalization efforts. I personally spend about 130 days each year
abroad, and I want our young Japanese employees to turntheir gaze outside of Japan to a much greater degree as well.
To this point, our new President Teramachi truly feels theimportance of having a global mindset from his experience
traveling around to different parts of the world during his timeworking at a large trading firm. I hope that he will take the leadin combining the strengths of our next-generation employees
to turn THK into a more global organization.

Reflecting on the 2023 Fiscal Year Results
2023 was the second year we spent in pursuit of our 2026
management targets. As a result of a business environmentthat included global turmoil, demand recovered at a rate that
lagged behind our expectations. It appears that demand
struggled to expand as capital investment that was expected
to kick off in the automotive industry was delayed, and investment in ICT (information and communication technology)
arising from stay-at-home demand during the coronavirus

10

THK Integrated Report 202 4

pandemic had already progressed.
As this environment led to shrinking demand in our industrial
machinery business, which constitutes approximately 60% of
our revenue, we were able to secure revenue during the firsthalf of the year due to our backlog of orders, but our demand
failed to recover in the second half. As for our automotive andtransportation business, which represents the remaining 40%
of our revenue, we saw recovery in demand as the pandemic
ended and component shortages were mitigated.
In terms of profit, although we continue to work on various improvements to increase productivity, decreased revenue primarily in our industrial machinery business resulted
in a higher cost-to-sales ratio. Furthermore, as we emerged
from the pandemic and implemented growth measures at fullforce, our SG&A ratio also increased.
As a result, our consolidated revenue in 2023 decreased
10.6% year on year to ¥351.9 billion, and our operating
income decreased 31.2% year on year to ¥23.7 billion. Although the aforementioned delay in demand recovery forced
us to make a downward adjustment to our earnings forecast
in August, we were able to achieve those adjusted targets.
In terms of the outlook for 2024, if the level of geopoliticalrisk settles down, we expect to see the recovery in demandthat we had anticipated. The main theme will be shifting from“global” to “glocal.” As the supply chain in the semiconductor
and other industries becomes more fragmented, there is an
emerging need to make capital investments within each economic bloc. While investment was focused on the construction of buildings in 2023, investment in the equipment that
goes inside those buildings will ramp up in 2024 and beyond,becoming a driver of growth in our earnings.

Growth Strategies
The pillars of our growth strategy are full-scale globalization, the development of new business areas, and a change

THK’s BusinessCorporate Philosophy

Change in Business Style

Providing innovative products to the world and generating
new trends to contribute to the creation of an affluent society
Vision:Transform into a manufacturing andinnovative services company

Full-Scale

ion

Globalizat

Expansion of Business Areas

Dev
Newelopme
Bus nt of
ines
sA

reas

Sustainability and ESG

in business style. In accordance with these themes, we pursue our vision of a revolutionary transformation into a manufacturing and innovative services company. We have always
provided customers with the means to manufacture goods
through our linear motion and other products, but we arenow expanding our service offerings to include everythingfrom before to after the sale. In this way, we are developing
an all-inclusive business package that fuses hardware andsoftware. This will allow us to expand our points of contact
with customers to include both machine builders and actualmachine users so that we can bolster our ability to contributeto their businesses.
In 2024 and beyond, we will focus on accelerating our efforts related to our growth strategies more than ever before.
By taking the initiative in responding to and proposing solutions for our customers’ needs, we hope to deepen their trustin us and form closer partnerships with them based on higher
levels of expectation.
The key focus of our industrial machinery business isachieving true automation and building systems that allow
production equipment to operate independently. True automation means there won’t be any people around to makeminor adjustments, so it carries the risk of sudden machinestops causing significant losses. That is why we will propose
solutions that can detect malfunctions before they happen
throughsensors installed inside equipment. In
addition to enabling predictive maintenance, such IoT services help customers reduce loss that occurs on the production floor, curb energy consumption, and decrease CO2
emissions. The combination of these services with an expansion of our linear motion products, which reduce the use ofelectricity and lubricant, will heighten our ability to contributeto sustainability. At the same time, we are pouring effort intodeveloping products that meet the cutting-edge needs ofvarious industries, such as providing nanometer-level precision for semiconductors and compact, highly rigid offerings
for machine tools.
Propelled by CASE in our automotive and transportation
business, we will accelerate the development of linear motion
products for automobiles and strengthen our efforts related
to electric vehicles, which are a major trend around the world.
Having experienced the comfort and joy of electric vehicles
myself, I don’t think I’ll ever go back to a gasoline-powered
vehicle. As we demonstrated with the unveiling of our original EV prototype, the LSR-05, at Japan Mobility Show 2023,
we hope to support the efforts of automotive manufacturers
around the world to transition to electric vehicles by proposing technology and products that will increase their value.
This includes providing lightweight, compact components
to make car interiors more comfortable and revolutionizing
charging systems to shorten charging times and increase
driving distances.
Furthermore, we will strengthen the synergy of our industrial machinery and automotive and transportation businesses
through increased collaboration. Even in 2023, we increasedAbout THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

11

our profits via structural collaboration by redistributing industrial machinery-related work to some of our automotive-related production lines. In addition to further expanding such
efforts, we will also strengthen collaboration among our engineering and development groups.

Talent Development
Digital talent will be the key to our transformation into a
manufacturing and services company. In this era where digitaltechnology is permeating every aspect of society, even as wework to provide products and services that support the DX
activities of our customers, we are also promoting DX within
our business practices and putting effort into developing digital talent that will drive such initiatives.
For our corporate and other support departments in particular, we need to develop the knowledge and capability touse data at a more advanced level, which includes identifying
how to use what kinds of data and distinguishing tasks thathumans should do from tasks that can be left to AI and otherdigital tools.
At the same time, we can’t say that digital talent is neededin every position. For instance, when it comes to our employees involved in production at our factories, I believe there
are three paths forward. The first is to hone their skills andexpertise, to thoroughly pursue artisan-level technique regardless of cost. The second is the path of looking into how
we manufacture things, of taking the skills honed by people
in that first category and incorporating them into the recipe
that will deliver products at a market-friendly price to customers around the world. Finally, the third path involves achieving
production lines that can flexibly mass-produce that recipe
within a limited timeframe. People who choose this path will
require knowledge similar to that of data scientists in orderto achieve fully automated production lines that can operate
steadily even with low staffing levels.
Similarly, even as we work to make our sales operations
more effective by utilizing virtual meetings and digital tools
such as chatbots, there are occasions where we must value
face-to-face communication, such as when generating ideas
for new business. It will be critical to determine the needsof the other party and combine both digital and in-person
methods.
In this way, even as we recognize the importance of digital
tools, we intend to develop a workforce of diverse individuals
who have a flexible perspective and won’t rely too heavily on
digital tools. By promoting the utilization of the right people
in the right positions, we aim to heighten the entire organization’s ability to generate value.

A Message to Our Stakeholders
We deeply appreciate the daily support and guidance we
receive from our shareholders, investors, and other stakeholders, and we always consider how to maximize everyone’s
returns from the success of our business.

As part of our efforts, we have emphasized PBR in recent
years as a metric that the public is concerned with. Out of ourbelief that increasing ROE is an effective way to improve ourcorporate value, we have set one of our 2026 managementtargets as an ROE of 17%. To achieve this milestone, it is critical for each of our business segments to increase their ROIC,
particularly by bolstering their returns (profit levels), which
form the numerator of that equation. Therefore, to accelerate
the efforts of each division, we must invest in future growth
by applying funds to capital investments, research and development, and human investments. Taking this capital demand
into consideration, we consider it appropriate to maintain apayout ratio of 30% for the present time. In the event that wehave surplus capital as we move forward in this direction, we
will strive to give more back to our stakeholders by actively
considering stock buybacks.
Many prototypes are developed in the process of making
our products ready for mass production and adoption, andit inevitably takes time before our labor comes to fruition in
the form of profit. However, the product that we deliver tothe customer will continue to work and generate value for along time. Due to the nature of our business, we have naturally developed a long-term perspective that looks 10 to 20
years in the future rather than chasing after short-term profit.
I am confident that this strength will also carry us through thisuncertain and unpredictable time. In anticipation of the futurestate of society, we have been transforming into a manufacturing and innovative services company and working on otherinitiatives to lay a groundwork that is showing sound indications of future growth. I hope that all of our stakeholders willcontinue to support us with a long-term perspective in mind.

12

THK Integrated Report 202 4

Greetings and Goals from the President and COO

Takashi Teramachi
President and COO

About THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

13

Partnering with Stakeholders to Contributeto an Affluent Society
It is a great honor to become the president of a com-

provide value to the world. The second principle is topany that was founded in 1971 and now has approxi-

value our customers and business partners. THK is themately 13,000 employees worldwide. I am humbled bycompany that it is today because of the trust that wethe heavy responsibility.

have earned from our customers and business partners

In recent years, we have experienced several social

in the course of offering value to society. I will strive tochanges such as a persistent threat of infectious dis-deepen this trust for the sake of co-creation with theseeases like COVID-19, increasing geopolitical risks inpartners. The third thing is to value innovation. THK’sa G-Zero world (where there is an absence of nations

history is a story of creating things that do not yet exist

providing global leadership), worsening global warming,in the world, of realizing greater potential, and of repeat-

and the spread of technologies such as robots and AI

ed trial and error. We have not simply made what ourthat replace human labor. The challenges are intricately

customers asked for or used what someone else told

intertwined and are causing large waves of change in

us to. Our work doesn’t end once we’ve created some-daily life and business. In the midst of all this, I believe

thing new. Innovation means seeing that new thing ad-that my role is to maintain a medium- to long-term per-opted by society, and that is what we will make sure tospective and work rapidly to create an executive foun-achieve. Fourth, we value society and our shareholders.

dation that allows the THK Group to grow sustainably.

THK’s business objective is to contribute to the creation

The name THK is an acronym of the things we prom-of an affluent society, and aiding in the achievement of

ise to our customers: Toughness (the delivery of toughthe SDGs is one part of this. To do so, it is necessary forand durable products), High Quality (the delivery ofeach and every employee to bring their individual talents

products of the best quality in the world), and Know-

to the table and to combine their strengths with others’.

how (contributions to the development of new exper-

At the same time, the understanding and support of ourtise). These core values are our brand, and every single

shareholders, who are also our partners, is extremely

employee holds them dearly. THK has made continual

important as well. I will pay close attention to the words

progress to this point as a unified company guided byof our shareholders, including their exhortations and en-

the corporate philosophy of providing innovative prod-couragement, in promoting our business activities.

ucts to the world and generating new trends to con-

I am aware that a major challenge for us is determin-

tribute to the creation of an affluent society. I would likeing how to make use of THK’s values according to how

to cherish and maintain the lessons learned and values

the times and our environment change. Even as our en-

instilled in THK over the past 50 years of operation. The

vironment changes drastically, I will make sure that wefirst of these is to value our employees. THK’s most im-see corporate value increase as a result of our trans-

portant assets are its employees, a fact reflected in ourformation into a manufacturing and innovative services

long-established custom of referring to them as “hu-company, and that we sustainably provide returns to ourman assets.” In addition to maintaining an environment

stakeholders. It is my mission to thoroughly strengthen

where people can work with enthusiasm, we will also

the parts of our business foundation that require it andstay focused on providing educational opportunities

to bravely change things that need to be changed.

and new experiences to our employees so that they can

Thank you all for your continued support.

14

THK Integrated Report 202 4

Value Creation
THK aspires to create a sustainable and affluent future by striving to develop products that meet society’s needs andworking to solve society’s problems.

Material Issues
p. 20-21
Creating an affluent
society and solving social
issues through innovation

Growth Strategies
p. 22-23
Full-scale
globalization

The Value Chain

Development of new
business areas

Development/Design

THK’s Strengths• Products with high quality, long service
life, high rigidity, and high accuracy

Decarbonization andrealization of a recyclingoriented society
Realization of a diverseand meaningful work
environment

Change inbusiness style

Procurement/
Purchasing

Strengthening of asustainable value
creation platform

Production• Core linear motion technology and its
adaptation for new product development

Distribution• Global integrated sales and production structure

Sales• Sales expertise in making proposals
that meet market needs

Corporate
Philosophy
Providing innovative products
to the world and generating
new trends to contribute to
the creation of an affluent
society.

Business foundation(Governance, local communities, environment, etc.)

p. 36-65

About THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

Outputs

Outcomes

Industrial Machinery Businessp. 26-27Addressing Labor Shortages

• Linear and rotary components• Seismic isolation and damping systems• Service robots• FA solution services

Automotive and Transportation
p. 28-29
Business• Next-generation auto parts• Linkage and suspension parts

Promotion of DX

p. 30-31• Development of new applications• Installation and promotion of RPA robots• Development of digital talent• Smart Factory Project

Talent Development

p. 58-59• Supporting the development of the next
generation• Promoting diversity• Training programs• Automation and robotization bolstered by linear
and rotary components• Energy savings supported by service robots• Customers’ overall equipment effectiveness (OEE)
boosted by

Preventing Global Warming

¥357.2 billion• Ratio of equity attributable to owners of the parent:

64.2%• Employees: 13,360• Ratio of employees outside of Japan: 57.7%
Employees certified with National Trade Skill Test &Certification (Production departments at THK andGroup locations in Japan)• Male: 1,516 • Female: 59

p. 62-63• Energy savings bolstered by linear and rotary components• Automobiles made lighter during the shift to electricvehicles thanks to aluminum products• Acceleration of solar panel
installations and other efforts
at THK facilities

Mitigation of Natural Disasters• Mitigation of earthquake damage with linear
motion technology adapted to seismic
isolation/damping systems

Advancement of Digital Technology
• Increased productivity and improved customer satisfaction from the promotion of DX• Participation in NEDO research and development
projects for widespread utilization of AI technology• Exhibition at the governmentsponsored Digital Technology Expo

THK’s Capital (2023 Fiscal Year)• Equity attributable to owners of the parent15

p. 16-17

Locations in Japan• Sales: 47• Production: 12
Locations outside of Japan• Sales: 74• Production: 25• R&D facilities: 3• R&D expenses: ¥5.6 billion

Intellectual property holdings• Registered: 2,487 • Published: 403

16

THK Integrated Report 202 4

Management Capital
Financial capital

Manufacturing capital

Relatedmaterial
issuesStrengthening of asustainable value
creation platform

Decarbonization andrealization of a recycling-oriented society

Creating an affluent society
and solving social issues
through innovation• Continuing to increase productivity• Strengthening individual skills• Increasing machine utilization:
upgrading equipment and promoting automation (trailblazing)• Seeking out precise materials
that are easy to process• Effective use of systems• Guided by the corporate philosophy of providing innovative products

Ourphilosophy• In recognition of the impact thatchanges in our external environment
have on our business, we consider
it integral to the continuation of ourbusiness to secure the necessary
capital for a sound financial base andinvestments in future growth. Internal
reserves are determined based on abalance between shareholder returns,
investments in growing fields, andmaintaining a sound financial basis.

• Strong cash flow generation• Establishing a net cash position
and maintaining a sound financial
basis• Ability to adapt to changing
customer requirements and user
trends with a flexible, global
production structure• Manufacturing made-to-orderproducts to meet customer
requirements• Producing products with a low
friction coefficient to reduceenergy consumption• Ability to provide individually
optimized products based on
our expertise and experience inachieving smooth, high-precisionlinear motion in the rolling guidecomponents of machines and an
extensive foundational platform• Equity attributable to owners of theparentTotal: ¥357.2 billion• Ratio of equity attributable to owners of the parent: 64.2%• Credit rating• Japan Credit Rating Agency (JCR)
A+ (issued Dec. 1, 2023)• Rating and Investment Information(R&I)
A+ (issued Dec. 1, 2023)• Capital investments: ¥28.7 billion• Capital investments: ¥28.7 billion• Production facilities: 12 in Japan,
6 in the Americas, 4 in Europe,
6 in China, 9 in Asia and otherregions• R&D expenses: ¥5.6 billion• Intellectual property holdings• Registered: 2,487(Entire THK Group)• Published: 403(Entire THK Group)• R&D facilities: 3(Japan: 1, Europe: 1, China: 1)• Reducing CO2 emissions andeffectively utilizing renewableenergy• Energy-saving activities• Promoting DX activities• Further cultivating our coretechnology of rolling machinecomponents and developing new
products• Developing (IoT) service to visualize component status based on
extensive performance data
• Turning pioneering products in
new fields into lines of business

Strengths2023 data

Intellectual capitalto the world and generating new
trends to contribute to the creationof an affluent society, we contin-ually create original products as
a company focused on creationand development.

* Investments in future growth: Approx. ¥170
billion (property, plant, and equipment investments made during the five-year period
from 2022 to 2026 only)

Futurechallenges
to address• Active and appropriate allocation of funds into investments
to increase returns (profit levels)
as part of our ROIC in both theindustrial machinery and automotive and transportation businesses as we engage with diverse
areas of medium- to long-term
growthAbout THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

17

THK generates new value and solves social challenges by effectively making use of the various types ofcapital it has established since its founding. We will continue to strengthen each type of capital in order tofurther bolster the foundation of our business.

Human capitalSocial capital

Natural capital

Decarbonization andrealization of a recyclingoriented society

Realization of a diverse andmeaningful work environment

Strengthening of a sustainable value creation platform• The contributions of each employee
are what enable us to continuously
grow and generate value as a company
focused on creation and development.

• We establish relationships of mutual
trust and strengthen the foundation of
our business operations by maintaining
a dialogue with our stakeholders andconducting related activities.

• To minimize the negative impacts of ourcorporate activities and strengthen thepositive, we work to generate sharedvalue in terms of sustainability throughefforts that are optimized for everyoneʼs
benefit, not just one set of interests.

• Training and support aimed at developing internal talent (data utilization training
and international trainee system)• Actively supporting the development of
external talent (THK Education Outreach
Program, internship program for international engineers, and cooperating withgovernment projects)• Continuing activities aimed at sustained
future advancement of Japanese industry, such as our EntSherpa technicalsupport service for start-up companies• Using our proprietary rolling technology
in linear motion components to reduce
consumption of electricity and lubricant
compared to conventional sliding motion• Training time: 30.75 hours/person• Training costs: ¥21,949/person• Employees certified with National Trade
Skill Test & Certification (Production departments at THK and Group locationsin Japan)• Male: 51• Female: 13• Interactions with shareholders andinvestors• Financial results briefings: 2• Interviews with institutional investors:
Approx. 270• SR meetings with major shareholders:
As appropriate• Supplier visits• Sustainability-related: 2• Materials-related: 7• Industry-academia-government collaborations• Solar power generated: 10,875 MWh• Recycled volume: 18,888 tons
• Zero emissions result: 0.12%• Ratio of women in management: 3.0%
(end of March 2025)• Initiatives to achieve severity rate of 0.01
or less (2026)• Incident rate of 0.50 or less (2026)• Strengthening Group governancestructure• Initiatives to increase complianceawareness• Strengthening risk management (BCP
and information security) structures• Initiatives to achieve medium- and longterm targets for carbon neutrality• 2030 CO2 emissions: 50% of 2018
levels (Scope: THK Japan and Group
companies in Japan)• 2050 CO2 emissions: Net-zero (Scope:
Entire THK Group)

18

THK Integrated Report 202 4

Relationship with Stakeholders

Stakeholders

Customers• Supply stability• Product development responsive to market demands

Major efforts• Providing high quality products• Technology seminars• Exhibitions in and outside ofJapan• Omni THKSharing information• Trade shows in Japan: 18• Trade shows outside ofJapan: 24• Private shows: 57

2023 results

Shareholders andinvestors

Business partners• Disclosure of financial andnon-financial information• Explanations of progress
toward and plans for accomplishing management targets• Building durable partnerships• The Integrated Report• Investor Relations section of
the website• General Meeting of Shareholders• Financial results briefings• Meetings to exchange opinions with institutional investors• IR information e-mail delivery
service “RIMSNET”• General Meeting of the THK
Association• General Meeting of Shareholders held in March• Financial results briefings: 2• Meetings to exchange opinions with institutional investors: Approx. 270• Confirmation of suppliersustainability efforts (2 companies visited)• Establishing relationshipsof trust• Local THK Association
branch meetings• Confirmation of supplier die
status (7 companies visited)• General Meetings of the
THK Association: 1• Local THK Association
branch meetings: 13• Losing orders to competitors

Risks• Development of new products unique to THKOpportunities• Reduced corporate value
due to insufficient communication with the stock market• Misconduct such as compliance violations• Increasing corporate value
by promoting THKʼs medium- to long-term growthpotential• Supplier diversification inclusive of companies outside ofJapan• Disruption of supply due tonatural disastersAbout THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

19

Our business is made possible through collaborative partnerships with all of our stakeholders, and we
aim to solve challenges through active and continuous communication with all parties. We will continue toreflect the feedback of our stakeholders while pursuing prompt information sharing, and we will strive forheightened corporate value and sustained growth.

Employees

Local communities

Government• Employee representative system• Involvement with local communities• Maintenance of an environment thatis easy to work in• Support for recovery efforts after adisaster• Payment of taxes on land occupied byeach location• Support for employee development• Proactive participation in industry-academia-government collaborations• Workplace patrols to check on healthand safety and maintain comfortableoffice environments• Acting in accordance with the laws
and regulations of Japan and othercountries• THK GROUP NEWS• Notice boards and announcements• Meetings and morning assemblies,etc.
• Employee parties and company
retreats (not held since 2020 due tothe coronavirus)• THK website• New manager training: 13 generalmanagers, 46 managers• Sponsorship of the Minato City Half
Marathon 2023

• Exhibition for Childrenʼs Tour of Kasumigaseki event• Data utilization training: 280 people
in the beginner course, 257 in theintermediate course• Exhibition at the Manufacturing Experience Stadium event• Participation in NEDO research anddevelopment projects• THK website• Participation in industrial organization
seminars• Collaborative research• THK Education Outreach Program• International trainees: 4 (2 in Germany, 1 in India, 1 in China)• Workplace accidents• Resignation of young talent• Infrastructure damage caused bynatural disasters• Legal violations• Strengthening THKʼs BCP• Strengthening of internal audits andinternal controls• Aging society• Creation of an appealing personnel system and employee benefits
unique to THK• Initiatives to eliminate workplace
accidents

20

THK Integrated Report 202 4

Material Issues and KPIs
Material Issues (Metrics and Targets)
As part of strengthening the sustainability management of the THK Group, an interdepartmental project to review
material issues in light of the most recent state of society and changes to THKʼs internal environment was launchedin 2021. Specifically, project members deliberated together about the social issues that surround the THK Group,
evaluating and examining these issues based on two axes: impact on business (horizontal axis) and societal demands
and expectations (vertical axis). The result was graphed into a matrix, and 13 topics under four themes received final
approval by the Board of Directors.

Defining Material Issues
Phase 4
Receive approval by the
Board of Directors▲

Phase 3Create a proposal for thedefined material issues▲

Phase 2
Evaluate against societal
and business axes▲

Phase 1Create a material issue
candidate list

Extremely
highMatrix● Solving social issues

through innovation

Societal demands
and expectations● Water resources● Being customer-oriented● Anti-corruption● Contributing to local communities

High● Biodiversity

High● Recycling and conserving
resources● Managing harmful substances● Occupational healthand safety● Compliance● Risk management● Climate change● Corporate governance● Appropriate labor● Quality and safety of● Information security/● Talent development

management
Data privacy● Sustainable procurement● Respecting and considering

human rights● Promoting diversity

products● Transparency of taxes

Extremely
highImpact on business

Themes and Topics Related to Material Issues
Topic● Creating an affluent society and solving social issues throughinnovation● Decarbonization and realization of a recycling-oriented society● Realization of a diverse and meaningful work environment● Strengthening of a sustainable value creation platform

Item
Solving social issues through innovation
Quality and safety of products
Climate change
Sustainable procurement
Recycling and conserving resources
Managing harmful substances
Respecting and considering human rights
Promoting diversity
Occupational health and safety
Talent development
Corporate governanceCompliance
Risk management

Messages from
Executive Management

About THK

Value Creation

Growth Strategies

21

Outside Director Interview

Metrics and Targets
Five working groups were established for the defined themes to pursue concrete initiatives for the material issues. Afterseveral rounds of deliberation among these working groups, the official metrics and targets were decided at a Sustainability Committee meeting held in October 2023. The entire THK Group will pursue activities aimed at the achievementof these metrics and targets.
Organization Structure

Sustainability
Committee
Chair: President

Sustainability
Promotion
Subcommittee
Chair: Vice President
Teramachi

Secretariat
Risk Management Department

Working Group 1: Solving social issues through innovation
Headed by Engineering Division
Working Group 2: Quality and safety of products
Headed by Quality Assurance Department
Working Group 3: Decarbonization and realizationof a recycling-oriented society
Headed by Environmental Management Section under
the Risk Management Department
Working Group 4: Realization of a diverse andmeaningful work environment
Headed by Human Resources & General Affairs Department
Working Group 5: Strengthening of a sustainablevalue creation platform
Headed by Risk Management Department

Metrics and Targets Related to Material Issues
Item

Metric and target

Scope

Target year

Creating an affluent society and solving social issues through innovation
Solving social issues
through innovation

Develop and provide new products and services (including DX and other solutions) for aerospace, automotive, logistics, medical, and other consumer fields

THK Japan, Group companies in Japan,
Group companies outside of Japan

2026

Quality and safety of
products

Promote the appropriate operation of quality management systems, including ISO
9001 and IATF 16949, and the maintenance of certifications at relevant locations

THK Japan

2026

THK Japan, Group companies in
Japan

2030

THK Japan

2026

Decarbonization and realization of a recycling-oriented society
Climate change

Reduce Scope 1 and 2 CO2 emissions to 50% of 2018 levels(2018 emissions: 106,514 tons, 2030 target: 53,257 tons)

Sustainable procurement

Distribute sustainable procurement guidelines to suppliers and conduct
interviews and surveys through questionnaires

Recycling andconserving resources

Maintain zero emissions rate1

THK Japan, Group companies inJapan (Production Division)

2026

Managing harmful
substances

Distribute green procurement guidelines and obtain proof of receipt andcertificates of non-use

THK Japan, Group companies in Japan,
Group companies outside of Japan

2026

Realization of a diverse and meaningful work environment
Respecting and considering human rights

Achieve a 100% completion rate for online human rights training

THK Japan

2026

Promoting diversity

Achieve a ratio where women constitute 20% or more of new hires in thesales, administrative, and engineering divisions

THK Japan

2026

Occupational health and safety

Achieve and maintain a severity rate of 0.01 or less and an incident rate of 0.50 or less2

THK Japan (Production Division)

2026

Talent development

Maintain a 95% completion rate for basic data utilization training

THK Japan

2026

Strengthening of a sustainable value creation platform

1
2

Corporate governanceContinue conducting annual evaluations of the effectiveness of the Board of Directors

THK Japan

2026

Compliance

Strengthen the diversity of internal reporting contacts and investigators

THK Japan

2026

Risk management

Continue conducting annual risk assessments

THK Japan, Group companies in Japan,
Group companies outside of Japan

2026

Zero emissions: An emissions rate (volume of waste disposed/total discharged)
Severity rate: The severity of accidents (number of lost workdays multiplied by 1,000 and divided by the total number of hours worked). Incident rate: The frequencyof accidents (number of deaths or injuries multiplied by 1,000,000 and divided by the total number of hours worked).

22

THK Integrated Report 202 4

Growth Strategies to Expand Business Domains

Change in Business Style

THK is committed to developing its business through three growth strategies: expanding its geographical range
through full-scale globalization; broadening the range of its product applications through the development of new
business areas; and fully utilizing AI, the IoT, robots, and other technologies through a change in business style.

alization

Glob
Full-Scale

Expansion of Business Areas

Dev
Newelopme
Bus nt of
ines
sA

reas

Full-Scale Globalization
THK has established an integrated sales and production structure with facilities and operations close to centers ofdemand in order to produce and sell locally: Japan, the Americas, Europe, China, and Asia. We are working to expand
our sales network and production structure in light of the medium- to long-term demand increases that have been
forecast for China and other emerging markets in recent years. In developed countries, we are also enhancing oursales network in a bid to steadily capture demand amid expansion in our user base. Through these means, we are
diligently promoting additional growth.

Facilities and Their Capital Investments

EuropeChina

Asia and OtherJapan

The Americas

Sales: 12

Sales: 30

Sales: 22

Sales: 47

Sales: 10

Production: 9

Production: 12

Production: 6

Production: 4

Production: 6

Development: 1

Development: 1¥1.8 billion¥7 billion

Development: 1¥3.5 billion¥13.4 billion¥2.8 billion

About THK

Messages from
Executive Management

Growth Strategies

Value Creation

Outside Director Interview

23

Development of New Business Areas
THK is actively working to develop new business areas in fields related to consumer goods, such as automobiles,
medical equipment, aircraft, and robots, as well as fields related to the mitigation of risks from natural disasters andclimate change, such as seismic isolation and damping systems and renewable energy. In order to capitalize on thevast potential in these industries, we are honing our abundant expertise and the core linear motion system technology
we have cultivated over time to accelerate the pace at which we develop new business areas.

Automotive
components

Seismic isolation anddamping systems

AircraftRobots©2018 Intuitive Surgical, Inc.

Medical equipment
Renewable energy

Change in Business Style
As digital technology rapidly develops, THK is also making efforts to further expand its business domains by ensuring
the thorough use of new technologies such as AI, the IoT, and robotics in sales, production, and development. In thisway, we are working to transform the frameworks and methods by which we do business.
OEE Optimization System

Platform for Communicating with Customers

24

THK Integrated Report 202 4

Increasing Corporate Value
2026 Management Targets and Our Approach for Increasing Corporate ValuePBR (price book-value ratio)＝

ROE (return on equity)

PER (price-earnings ratio)

Further improvement by promoting management that is conscious of capital cost
Management targets (2026)
Consolidated revenue: ¥500 billion Operating income: ¥100 billion EPS: ¥590 ROE: 17%
ROIC improvement in each business division
Industrial machinery business (top-line growth)

Automotive and transportation business (profitability improvement)

Revenue: ¥365 billion / Operating income: ¥92 billion
Assuming an average market growth rate of approx. 7%

Revenue: ¥135 billion / Operating income: ¥8 billion
Assuming an average market growth rate of approx. 5%• Expanding market share and strengthening global production capabilities)• Promotion of DX (Omni THK and• Continuation and strengthening of recovery plan
• Profit-focused management• Expansion of products for next-generation vehicles• Strengthening of aluminum products• Accelerating new product development

Acceleration of initiatives in each business division
Active and appropriate allocation of funds into investments to increase returns (the numerator of ROIC)
Capital investment: Approx. ¥150 billion in the industrial machinery business and approx. ¥20 billion in the automotive and transportation business over a five-year period (2022 to 2026)
Research and development: Develop and expand applications for new products and services
Human investment: Consider raising salaries and expanding the stock compensation system to boost motivation
Payout ratio: Maintain at 30% for the time being

Stock buybacks will be considered in the event of surplus funds if these conditions are met.

In order to increase our corporate value, we believe that it is essential

rate. For the automotive and transportation business, in addition toto improve our ROE. Therefore, as part of our 2026 management

continuing our previous efforts to improve profitability, a major focus

targets that serve as a milestone toward our ultimate goal, we havewill be to increase profits through the introduction of new products.

set our ROE target at 17% to go along with a consolidated revenue

As a means to accelerate these efforts, we will allocate funds to in-of ¥500 billion and an operating income of ¥100 billion. To achieve

vestments in future growth, including capital investments, researchthese results, it is critical for both our industrial machinery businessand development, and human investments, for which we are consid-

and automotive and transportation business to increase their ROIC,

ering raising salaries and expanding our stock compensation system

particularly by bolstering their returns (profit levels), which form theto boost motivation. Taking this capital demand into consideration,

numerator of that equation. For the industrial machinery business, we

we consider it appropriate to maintain a payout ratio of 30% forbelieve top-line growth will be the greatest driver of increased returns.

the present time. However, in the event that we experience surplus

This will involve continued efforts to steadily capture the enormous

capital as we proceed with this plan, we will actively consider stock

growth in demand as we internally corroborate a high market growthbuybacks.

Messages from
Executive Management

About THK

Value Creation

Growth Strategies

Outside Director Interview

25

Efforts by Each Business Segment to Achieve Targets
Industrial Machinery BusinessIn the industrial machinery business, our targets are a revenue ofand robotization, and expansion of environmental investments such¥365 billion and an operating income of ¥92 billion. Based on past

as electric vehicles, and investment in each of these areas is expect-

performance, we estimate that the average annual market growth

ed to continue and grow in the medium to long term. Furthermore,

rate will be about 7%, and we predict the same growth rate throughwe will achieve growth that exceeds this projected growth rate by

the 2026 fiscal year. The main driving forces for this growth are theexpanding our market share, promoting DX, and developing andincreased demand for semiconductors, advancement of automation

launching new products in new fields.

Automotive and Transportation BusinessIn the automotive and transportation business, our targets are a rev-

addition to increasing the supply of existing products that contributeenue of ¥135 billion and an operating income of ¥8 billion, assuming

to smaller and lighter components as the shift toward electric ve-

an average annual growth rate of about 5% in global automobile pro-hicles accelerates. Furthermore, with regard to the urgent issue ofduction. We have set a growth target that exceeds that of automotive

improving the profitability of the automotive and transportation busi-

manufacturing,
will develop and launchnew, next-generation■ Industrial
machinery
Top: Revenueas(¥1webillion)ness, we will expedite efforts centeredManagement
on reorganization
with the aim
Targets■ Automotive
andBottom: products
Operating income(¥1 billion)
automotivethat address
the progressof CASE
in transportation
the auto-of achieving our operating income target. Revenue: ¥500 billion

Operating income: ¥100 billion
EPS: ¥590 ROE: 17%

motive industry and expand the supply of these products globally in

Results by Business Segment

393.6

IFRS

34.4
353.4
49.8
318.1
318.8
■ Industrial machinery
Top: Revenue
30.2
36.4(¥1 billion)
274.5
Bottom: Operating income (¥1 billion) 18.2 ■ Automotive and transportation
218.9
282.1
-8.4
202.2
238.6
51.1
231.9
33.2
50.6
177.8
35.1
22.7
144.2
393.6
7.7
IFRS
34.4
Consolidated
353.4
116.6
114.8
111.6
96.8
49.8
318.1
318.8
74.7
86.3
3.2
-0.8
-16.6
-4.5
30.2
36.4
-16.1
-4.8
274.5

Consolidated

351.9
23.7

217.5
22.2

Management Targets
365.0
Medium- to Long-Term Revenue:¥500 billion
92.0
Market Expansion Operating income:¥100 billion
EPS: ¥590 ROE: 17%

351.9
134.4
23.7
1.6

135.0
8.0

365.0
Medium- to Long-Term
2020
2021
2022
2023
2026
(E)
92.0
218.9
Market Expansion
282.1
217.5
-8.4
* The numbers
and transportation
business are the combined values from THK RHYTHM and THK RHYTHM AUTOMOTIVE.
202.2 for the automotive
238.6
51.1
22.2
231.9
33.2
50.6
177.8
35.1
22.7
144.2
7.7

(Fiscal year) 2017

2018

18.2
2019

116.6
3.2

114.8
-0.8

96.8
-4.5

74.7
-16.1

86.3
-4.8

(Fiscal year) 2017

2018

2019

2020

2021

111.6
-16.6

2022

134.4
1.6

135.0
8.0

2023

2026 (E)* The numbers for the automotive and transportation business are the combined values from THK RHYTHM and THK RHYTHM AUTOMOTIVE.

Capital Investment by Business Segment(¥1 billion)
40.0
31.6

20.0

16.1

23.9

31.6

■ Industrial machinery■ Automotive andtransportation

7.6
31.6

16.1

23.9

26.7

15.9
9.8

6.1
0
(Fiscal year) 2017

12.5
31.6

28.7

21.4

19.1

(¥1 billion)
10.0
40.0

31.4

16.5

■ Industrial machinery
6.1■ Automotive
and4.8transportation
2020
2021

25.8

Management target (Consolidated revenue:¥500 billion)
Five-year capital investment1 estimatebased on this target Consolidated total

Industrial: Approx. ¥150 billion
Automotive 2: Approx. ¥20 billion

31.4
4.7

Consolidated total: Approx. ¥170 billion

Management target (Consolidated revenue:¥500 billion)
2018
2019
2022
2026
Five-year capital investment1 estimate
21.4
based on this target Consolidated total
1
Property, plant, and equipment only 2 The19.1
numbers for the automotive and transportation business are the combined values from THK RHYTHM and THK RHYTHM AUTOMOTIVE.
20.0

10.0

0

6.1

9.8
7.6

26.7

15.9

12.5

6.1

16.5

4.8

2.9
28.7
2023

25.8

Industrial: Approx. ¥150 billion
Automotive 2: Approx. ¥20 billion
Consolidated total: Approx. ¥170 billion

4.7

2.9

26

THK Integrated Report 202 4

Business Strategy
Industrial Machinery BusinessTransforming into a Manufacturing andInnovative Services Company Trusted
by Customers
Takashi Teramachi, Senior General Manager of Industrial Machinery Headquarters
Our Business
The main products of our industrial machinery business are

and India to provide a sales support framework that spans thehigh-precision positioning linear motion products such as theglobe. As AI, robotics, and other digital technologies progress

LM Guide, ball screws, and ball splines in addition to cross-roller

and major countries face labor shortages, we anticipate a needrings, which are a rotary component. We also deal in actuators

for automation and labor savings in many fields that will driveand modular products that combine machine components. These

expanded demand for our main products. Furthermore, we haveproducts have been adopted for use in a wide variety of mechan-also expanded our OEE (overall equipment effectiveness) optimi-

ical devices, including semiconductor manufacturing equipment,zation system

machine tools, industrial robots, 3D printers, automated ware-such as our tape-free AGV, SIGNAS. By adding an FA solution

houses, robotic surgical systems, high-speed railways, aircraft,business to our existing machine component business, we aim

and both solar and wind power generation equipment. As forto establish a structure that allows us to support the manufactur-

our organizational structure, we possess manufacturing facilities

ing operations of a variety of customers, from machine makers

in Japan, Europe, the Americas, South Korea, China, Vietnam,

to machine users.

and begun selling service robots

Reflecting on the 2023 Fiscal Year
With regard to our 2026 management targets, bolstered by thenificant decrease in profit. In addition to the continued short-term

increase in semiconductor-related demand, the advancement of

ebb and flow of capital equipment demand, we anticipate that

automation and robotization, and the expansion of electric vehi-

the economic environment will grow increasingly uncertain due

cles and other environmental investments, we aim to utilize AI,

to the rise of economic blocs and labor shortages. In response,the IoT, and robot technology alongside the machine component

our industrial machinery business will work toward strengthening

technology we have honed since our founding in order to fortify

QCDS under the slogan of glocalization (combining global andour position as a company that supports growing fields and to

local elements).

achieve a revenue of ¥365 billion and an operating income of¥92 billion.

First, in terms of R&D, we have released an LM Guide witheight raceways that comes in sizes that conform to global stan-

Facing low general demand related to semiconductors and ro-dard dimensions and can accommodate nanometer-level move-bots in 2023, we were able to achieve revenue in the first half ofment accuracy in order to provide the high precision, high rigidity,

the year thanks to a high volume of previously received orders.

and compact dimensions required for semiconductors and oth-

However, as demand failed to recover in the second half of theer fields. Additionally, we offer a miniature LM Guide that helps

year, we ended up with a decrease in both revenue and profit,

boost production capacity for semiconductor chips. For the au-with consolidated revenue standing at ¥217.5 billion (a 22.9%

tomation of transfer and logistics-related processes, we havedecrease year on year) and operating income at ¥22.2 billion (aalso introduced wheel guides and utility slides to the market.

56.6% decrease year on year). In terms of profitability, we were

In terms of production, we have steadily expanded our ability

aided by continued improvements in variable and fixed costs into provide products and strengthened our cost competitivenessaddition to a favorable exchange rate, but the volume effect ofat all of our factories through automation and in-house sourcing.

our reduced revenue had a negative impact that resulted in a sig-

As for sales, we have opened our third ASEAN-region sales

Messages from
Executive Management

About THK

Growth Strategies

Value Creation

Outside Director Interview

27

office in Vietnam to bolster our ability to take care of customers

Solution, which centralizes the management of production em-

in this region where demand is expected to rise in the future. We

ployee skill data and dramatically boosts the efficiency of skill

also revised our internal structure to be able to take even moremanagement. In addition, we have expanded our lineup with ameticulous care of customers who are expanding their design

new SIGNAS product that has a one-ton towing capacity andand manufacturing operations worldwide. In this way, we havereleased a next-generation linear transfer system for material

strengthened the ability of our machine component businesshandling automation. For these products, we have placed em-

to introduce new offerings to growing markets and to tailor ourphasis on selling to machine users. Increasing the diversity ofprovision of products to demand fluctuations, and we have bol-

our customer base and selling to both users and manufacturers

stered our structure to be able to increase our share in overseas

allows us to understand market trends better than with our tra-markets as well as the Japanese market. Furthermore, we haveditional machine component business, and we expect that it will

put effort into developing our IoT services and service robots tomitigate profit impact caused by economic fluctuations, which

expand contact with a diverse range of customers. We released

will strengthen our business foundation over the long term.

our fourth iteration of, the Skill Management AI

Future Business Developments
Since our founding, we have polished our LM Guide technol-

time, for our FA solution division, we will focus on expanding ourogy, which was a development that significantly reduced friction

business while contributing to the DX (digital transformation) andresistance by replacing traditional sliding motion with rolling mo-

GX (green transformation) efforts of our customers. Furthermore,

tion. We will continue to conduct R&D and improve our productthrough the synergy of our machine component and FA solu-

performance as a means to help reduce the energy consumption

tion businesses, we will establish an ecosystem that is uniqueof customer equipment. In addition to reducing the energy used

to THK.

by production processes at our factories, we aim to reduce CO2

Within the industrial machinery business, all of our staff willby utilizing renewable energy. In 2023, we installed solar panels

work with vigor as we delve deeper into full-scale globalization,

at four production facilities: the Yamagata plant, THK NIIGATA,

the development of new business areas, and a change in busi-

THK Liaoning, and THK RHYTHM Thailand.

ness style. We will construct a framework to continuously provide

Even as we seek to introduce products in demand by growing

reliable products and services to both machine makers and us-

markets, improve our ability to supply such products, strengthen

ers around the world, and in doing so, we will transform into a

our cost competitiveness, and expand profitability within our ma-

manufacturing and innovative services company. In addition, we

chine component business, we will also focus on developing ap-

will contribute to the creation of an affluent society while valuing

plications in new fields such as the space industry. At the same

people and the global environment.

Evolution of the Industrial Machinery Business

Ecosystem (Future)

Supply Chain (Past)
Machine user

Machine maker

Machine user

Cooperation

Supplyproducts

Machine makerServicerobots

Evolution
Cooperation

Next-generation
linear transfer
systems
IoT services(OMNI edge)

Supplyproducts

Machine component business

Cooperation

Machine component businessFA solution business

28

THK Integrated Report 202 4

Business Strategy
Automotive and Transportation Business

Strengthening Development of New Products
That Meet Social Needs
Nobuyuki Maki, Senior General Manager of Automotive & Transportation Headquarters
Our Business and Strategy
The Automotive & Transportation Headquarters is largely split

parts are used in.
2. AMC (Automotive Mechanical Components)

into the following three business areas.
1. Development, Manufacture, and Sale of L&S (Linkage

This business segment develops, manufactures, and sells balland Suspension) Parts

screws for automatic brakes and electric parking brakes, active

We create original designs for suspension links, ball joints,

suspension units, and other parts that are essential to self-driving

tie rod ends, and stabilizer links, which are important compo-

technology.

nents that support the basic car functions of driving, turning,

3. Electric Actuator Development

and stopping. The Group companies THK RHYTHM and TRA

We develop modules that are incorporated directly into auto-(THK RHYTHM AUTOMOTIVE) propose, manufacture, and sellmobiles to improve the riding experience and safety performancethese products to component manufacturers and our primaryas self-driving cars become more prevalent.

customers: automotive and truck manufacturers in Japan, North

One thing that all our divisions share is our intent to provide a

America, Europe, China, and other parts of Asia. In addition, ourvariety of products and refine our technology to meet the require-suspension links, ball joints, and tie rod ends are classified as

ments demanded by the market.

critical safety parts. See the figure below for the mechanisms our

Next-Generation Components
Electric Service Brake ESB™

MR Fluid Active Damper
Tube MRDT™

Stealth Seat-Slide

Ball Screw for Electric Integrated

System SLES™

Brake Control

Variable Magnetic Flux InWheel Motor enemo™

Active Level Control

Suspension ALCS™

Ball Screw for

Active Suspension Units

Height sensor joints

Linkage and Suspension
Contactless Power

Supply System CLPS™

Suspension arms

Suspension ball joints

Steering linkages

Stabilizer connecting rods

Steering tie rods (rack and pinion type)

About THK

Messages from
Executive Management

Growth Strategies

Value Creation

Outside Director Interview

29

Accomplishing Our 2026 Fiscal Year Management Targets (Reflection on 2023 and Initiatives for 2024)
In order for the automotive and transportation business toactivities to pass on price increases, production restructuring,achieve our 2026 management targets, we will take measuresand staffing reductions, as well as the weakness of the Japanesesuch as strengthening our existing products and expanding new,yen, enabled the automotive and transportation business to turnnext-generation products to achieve a higher growth rate thana profit for the fiscal year, with a revenue of ¥134.4 billion andthat of the automotive market, aiming for a revenue of ¥135 bil-an operating income of ¥1.6 billion overall. With sales projectedlion and an operating income of ¥8 billion.

to increase as a result of our main customers’ plans to increase

Automotive production and sales rebounded in 2023 with the

production in 2024, we are promoting production restructuring

end of the coronavirus pandemic and the easing of component

and cost reduction initiatives to improve our profitability and spur

shortages. At the same time, our cost reduction efforts such as

profit growth.

Future Initiatives: Working to Achieve a Sustainable Society
Cars are currently required to be safe and environmentallyfriendly modes of transport, and I believe it is our role to propose
and provide a stable supply of products that will achieve that
aim. With respect to being environmentally friendly, we continue
to comply with environmental and fuel efficiency regulations and,as the EV transition continues and lightweight aluminum parts
are increasingly utilized in North America by both regional manufacturers and Japanese ones transitioning to local procurement,
LSR-05

we are promoting the development of linkage and suspension
parts tailored for use in electric vehicles. As for safety, we believethat greater safety can be ensured by providing electric actuators

adaptations of THK’s linear motion technology, it embodies what

and other products with high added value that adopt THK’s core

we envision automotive technology to be in the future as CASE

technology. The new ball screws that we began developing, man-continues to progress in the automotive industry.

ufacturing, and selling for automotive applications have become

We will look ahead five to ten years in the future and anticipate

essential products for CASE*-related self-driving technology,

needs customers might not be aware of yet, utilize the expertise

where they have been adopted for use in automatic and integrat-

and technology THK has accumulated since its founding as aed brakes. We have also now begun shipping these products forcompany focused on creation and development, and develop

use in next-generation suspension mechanisms. Going forward,

new products that meet future societal needs for self-driving

we intend to expand sales in new sectors with ball screws andtechnology and reducing automobile accidents involving aging

other products for eAxles and new braking systems.

drivers. In doing so, we aim to achieve the creation of a sustain-

Our working EV prototype, the LSR-05, made its world debut

able society.

at the 2023 Japan Mobility Show. Equipped with cutting-edge* CASE stands for Connected, Autonomous, Shared & Services, and Electric.

Progress of Automotive and Transportation Business Restructuring2023: Business restructuring and achieving profitability

Existing
products

Maintaining/strengthening therecovery plan
Restructuring production and theorganization
Profit-focused management(not fearing cutbacks)
Consideration of eliminating
unprofitable products and downsizing/closing factories
Manufacturing industrial
machinery products
Production at THK RHYTHM

Existing products:
Approx. ¥2 billion cost reduction･ ¥60 million saved by eliminating un-

profitable products･ Continuing to negotiate passing on
additional price increases

Improving profitability
Strengthening aluminum products
Industrial machinery products:

2024: Produce approx. ¥3.3 billion
Consider expansion to other factories
New, next-generation products

Approx. ¥2.1 billion produced* Included in automotive and transportation
business results and plans

Expand to next-generation products
New, next-generation products2024 onward: Expanding profits

Accelerate development and expand new orders

Accelerate development and expand
new orders
New products

New technology (announced in 2023)

30

THK Integrated Report 202 4

DX Promotion and PlanningOmni THKWe are continuously developing and promoting Omni THK as a

We are merging member profiles previously spread acrosscore tool that enables employees to devote more time to work

multiple services, developing applications that improve customer

with high added value by deepening our relationships with cus-convenience and help digitalize customer movement, and pro-tomers (restructuring the user experience) and utilizing automa-

moting the fusion of in-person and digital methods.

tion to reduce the amount of time spent on routine tasks.

Fusion with Omni THK (digital tool) to boost customer satisfaction and productivity
Online Services
My Page

Tools

Streamlines service
provision

Omni THK

Product Information

SupportProduct
Information

SDS (MSDS)End UserDesigner

Linkingwith EDI(ODO*)

Shipping date/history information

Past Order Search
Catalog productselection

Requesting/obtaining quotes
Connecting to other systems

Core system

Orders

THK salesperson, etc.

Fast Delivery

Linkingwith EDI(ODO*)

Drawing management/ requests

Your Catalog

Purchaser

Distributor
Salesperson,
etc

Streamlines service
provision* ODO: Omni THK Direct Order System

OMNI edge

Developments in OMNI edge

Realizing early on that the IoT was an effective technology for solving social challenges such as labor shortages and the need toboost productivity in the manufacturing industry, THK has beendeveloping solutions to advance the adoption of the IoT worldwide.

can be retrofit onto equipment in use forquick IoT integration. Since its launch in 2020, we have developed

Phase 1
Phase 2Phase 3Phase 4Service name
Predictive failure detection AI solution for linear
motion components
Predictive failure detection AI solution for rotarycomponents
Tool Monitoring AI Solution
Skill Management AI Solution
Centralized Maintenance Management Tool

Launch date
January 2020
February 2022
November 2022
December 2023
December 2023

four versions of this service and a connected tool. In order to ac-

We will continue to introduce solutions—not only for our own pe-tively promote new business in concurrence with the first releaseripheral equipment, but for the greater market as well—that willphase, we established our new IOT Innovation Division to replace

minimize and reduce various types of efficiency loss on the pro-our previous framework of conducting interdepartmental projects.

duction floor and improve overall equipment effectiveness (OEE).

Equipment
Efficiency Factors

Five Major Typesof Loss Hindering
Human Efficiency

Changeovers/adjustments

Management loss

Tool changes

Motion loss
Organization loss

Breakdowns

Skill Management AI Solution

Predictive failure detection AI solution(Linear motion and rotary components)

Setup
Momentary stops/idlingDistribution loss

Slowdowns

Adjustment loss

Defects/rework
Shutdowns
Tool Monitoring AI Solution

Messages from
Executive Management

About THK

Growth Strategies

Value Creation

Outside Director Interview

31

Developing Digital Talent and DX Tools
THK is also putting effort into the development of the “DX talent”

maintenance so that the production floor can utilize that datathat constitutes the driving force behind our DX activities. At themore independently. Our robotic process automation (RPA) has

same time, we are promoting digital tools and performing data

even won awards from outside competitions.

Developing Digital Talent
Further expediting DX activities with company-wide skill improvement
Expanding the scope throughtalent development
Data utilization training（2019 onward）
901 participants (333 from management,
568 at the beginner level)
E-learning courses for all
employees（2021 onward）
3,728 participants
From statistics to programming（2020 onward) 221 participants

Advanced

Training for datautilization specialists

Intermediate
Management
BeginnerBasic
New employee

Image analysis, timeseries analysis,
project management

Forecasting models via
machine learning, introductory Python（2021 onward）
289 participants

Production Division
The Production Division embarked on its Smart Factory projectto the 5M production process and ongoing quality and produc-in 2023, and it has developed a variety of digital solutions since

tivity improvements.

then. Through this initiative, they continue to promote innovations

Current Solution Structure to Achieve a Smart Factory
Contact angle
analysis software(Contact angle 3D
analysis System)

Operator support
systemMan

Cloudmeasurement
solution

Sensing
Utilization

Virtual production
line simulator

Operation analytics
improvement software

Collection
MachineMeasureData analysis platform(BI tool)Analysis

MethodVisualization

Material

Equipment
maintenancemonitoring
systemEquipment operation
status monitoring system(E-Grouping SYSTEM)
System that uses RFID tags
(Hunter SYSTEM)

Main Digital Solutions
Man

Machine

MethodEmployee support system (Smart Follow)･ Connects equipment operating status to a wearable device. Immediately notifies administrators and operators of incidents.
･ Achieves 24-hour normal equipment status and stable operation 365 days a year through analysis of short andextended stops and countermeasure improvement.

Production equipment operation status moni- ･ Monitors real time operation data for production equipment and robots. Features dashboards and performs KPI
analysis.
toring system (E-Grouping SYSTEM)
Equipment and device maintenance manage- ･ Register and store equipment and device inspection and maintenance requests using a smartphone. Sends fault
warning notifications.
ment systems (Tenken System and Help Link)
Development of operation analytics and work ･ Uses video to enable analysis, improvement, and digital standardization of operations. Handles transmission of expertise and succession problems.
optimization software
Utilization of a 3D digital production line simulation ･ Semi-automatically generates factory layouts and the flow of products and materials. Enables advanced forecasting for process line planning.
Strengthening of THKʼs core system and prod- ･ Transition from a paper system of product information management to traceability management using THKʼs core

Material uct lot allocation management

RFID solution (Hunter SYSTEM)

system.

･ Connects RFID tags and product information and visualizes them within the system. Improves operations and reviews the flow of material.

Cloud IOT measurement solution (Smart Mea- ･ Collects and stores digital inspection data from manual and automatic measurements taken on the production floor.

Measure sure system)･ Strengthens real time data monitoring, fault monitoring, analysis, and utilization and traceability management.

32

THK Integrated Report 202 4

Outside Director Interview

Evolving Governance and Increasing
THK’s Global Presence throughDialogue and Swift Action

Yoshiki Ueda,
Outside Director

Tomitoshi Omura,Outside Director

As part of our five-year plan that ends in 2026, THK is aiming to achieve growth that exceeds the average market
growth rate. Even as we strengthen our corporate governance code to establish a firm base for bolstering corporate
value, our team of internal and external directors and audit and supervisory committee members is collaborating to
improve the effectiveness of our Board of Directors for the sake of responding soundly to the various demands of ourexternal stakeholders.
In this interview, two of our outside directors, Tomitoshi Omura and Yoshiki Ueda, discuss the highlights of our efforts to strengthen governance and our future challenges.

Ever since you were appointed as outside directors, what has been your impression of theeffectiveness of the Board of Directors?

Ueda:

Since I was appointed in 2016, the Board of
Directors has steadily become more effective. Thisis because THK has a firmly established corporate
culture of open communication, where even the
Board of Directors constructively deliberates on thevarious proposals we present them with, and theyhandle affairs with earnestness. As a small sample of the proposals we’ve brought up, we havetold them that we want them to start holding theBoard of Executive Officers and Board of Directors

About THK

Messages from
Executive Management

Value Creation

meetings on separate days to allow for more relaxed deliberation, and that they should have deeper conversations with a focus on the medium tolong term by holding quarterly reporting sessions
for both the industrial machinery and automotive
and transportation divisions. When it came tothese proposals, then-President (now Chairman)
Teramachi and the entire Board of Directors immediately implemented them. Furthermore, they put
consideration into making sure members understand the current situation, including sending out
materials prior to Board of Directors meetings soeveryone has sufficient time to read through them.
As an outside director, it’s also very reassuring thatthe executives are strongly aware of the corporate
governance code.

Growth Strategies

Outside Director Interview

33

the discussion rather than just having the directors
analyze and evaluate themselves, and that suggestion was implemented starting from the next year’s
Board of Directors meeting. I feel that this demonstrates how the Board of Directors executes a highly effective PDCA cycle. The acuity of deliberation
has also increased as both divisions report on the
progress and future course of their medium-term
management plan. Additionally, I feel it is crucial tobe familiar with the atmosphere in the workplace,so along with other outside directors, I visited several locations in 2023, including the Yamagata,
Yamaguchi, Gifu, and THK RHYTHM Hamamatsu
plants. In the end, I spoke with 31 branch heads
and managers, observing the changes that haveoccurred over time while exchanging information
with management, which brought a number of
useful things to my attention. I also work closelywith departments that perform critical corporate
functions such as the finance, accounting, and internal audit teams, and we occasionally have very
in-depth conversations about corporate accounting. I think that this kind of dialogue involving theentire company lays the groundwork for the Boardof Directors to evolve.

Omura: I agree. Similar to Mr. Ueda, I was appointed in2016, and the Board of Directors at that time wasstill just an extension of a decision model mindset.
However, in accordance with the establishment of
the Audit and Supervisory Committee that year,
they took positive steps toward strengthening
oversight. As one example specifically regarding
the evaluation of effectiveness, we proposed that it
would be better to have outside experts involved in

What is necessary to make the Board of Directors even more effective?

Ueda:

The challenge moving forward will be revising thecriteria for discussing matters in Board of Directors
meetings. The current criteria were established before the 2015 corporate governance code cameinto place, so I can’t deny there are aspects that
don’t align with a monitoring model. I think the discussion criteria need to be updated to consider therequirements of the corporate governance code,and there needs to be more in-depth deliberation
regarding the medium- to long-term management
strategy and policy.

Omura: Precisely. In preparation for 2026, the final year of
the medium-term management plan, THK requires
the alignment of not only the perspectives of its
executives, but those of a variety of stakeholders,
including external ones. Fortunately, as outside directors, we are also given frequent opportunities
to offer input from numerous stakeholders, so wedefinitely want to revise our discussions about
where our focus should realistically be placed according to that input.
Ueda:

Our new President Teramachi, who assumed his
new position in January 2024, also pays close attention to the matters we bring up for consideration. The fact that THK possessed the necessary
climate and framework to quickly transition its operations and Board of Directors meetings to a virtual format for the coronavirus pandemic startingin 2020 is due to the new President (then-Director)
Teramachi having always spearheaded and pushedforward with DX. I think that the agility with which
the top executives respond to societal trends hascaused the effectiveness of THK’s governance tosteadily increase. We want to do our part in helping
THK become an even more robust company.

34

THK Integrated Report 202 4

From your perspective as outside directors, how do you view THK’s risks and opportunities as well as the current initiatives and challenges in relation to both?

Ueda:

The Risk Management Committee deliberates
regularly based on highly accurate risk maps, andthe contents are reviewed annually by the Boardof Directors. One of our current challenges is the
profitability of our automotive and transportation
business, but we have already taken a number ofcountermeasures, and the groundwork is beinglaid to turn risk into opportunity.

Omura: Our risks and opportunities have been publishedand detailed extensively by theme in our Annual
Securities Report and Integrated Report. However,another method we could use would be to examine risks and opportunities at each stage of thevalue chain: development, design, procurement,purchasing, production, distribution, and sales.
I think THK’s greatest strengths are its customer focus and innovation, but what risks and challenges
would arise if those were put into practice at eachstage of the value chain? In particular, THK values
its integrated sales and production structure, but
it has both pros and cons in terms of geopoliticalrisks. I think that reexamining the external environment from that kind of perspective will make newchallenges more evident.

Ueda:

Improving the accuracy of our risk analysis is certainly an area of future growth. Even as our business shifts from “global” to “glocal,” many of the
top people in each region are Japanese. We needto shift into a higher gear and create a framework to maximize our utilization of local networks.
Companies with locations around the world willoften see discrepancies in the earning capacity andtalent performance of each region, but that can be
an impediment to rapid business development.
Fortunately, THK is a company with high levels of
loyalty on a global scale, so I believe that once a
policy is announced, change will happen. I’d liketo capitalize on my past experience at a general
trading company to assist with creating a structure
to maximize our global management resources.

Omura: I agree with Mr. Ueda’s suggestion of picking up
the pace. To increase corporate value, it’s crucial tohave a precise and agile response to risks in timesof high uncertainty. It’s become more of an established practice recently for THK to analyze risk andopportunity from an ESG perspective, and suchdeliberations frequently take place even during
Board of Directors meetings.
Ueda:

Management considers environmental risk to bea priority, and they’re focusing on the opportunities presented by lines of business that meet theneeds for motorization and decarbonization. As
one example, THK displayed its original electricvehicle prototype, the LSR-05, at the 2023 Japan
Mobility Show. I was deeply impressed by THK’s
good sense to get ahead of the curve and presenta real-life prototype filled with top-class innovation
to Japanese and overseas automotive manufacturers.

Omura: I was also surprised by the display of the LSR-05.
In witnessing our non-automobile company createa working car and seeing the powerful PR that emphasized the superiority of the automotive components, I was moved by THK’s extraordinary desire
for innovation.

About THK

Messages from
Executive Management

Value Creation

Growth Strategies

Outside Director Interview

35

What challenges need to be overcome to achieve the management targets and improve
corporate value? Additionally, what expectations do you have of employees in relation tothese goals?

Ueda:

Right now, messages and policies from the executives are broken down and conveyed to employees
in the workplace, so a positive top-down flow of
information is in place. However, looking ahead toward future growth, THK needs a system that willdevelop the next generation of management froman early stage. If there were a system to increase
opportunities for young employees to see an overhead view of the business and bring the people
who are second in command into the forefront, I
think the upward pressure on management frombelow would also be a reinvigorating force. In thisday and age, we are able to make data-driven decisions that aren’t necessarily based on any ruleof thumb. With that being the case, I hope to see
people valuing critical thinking, keeping their ears
to the ground, and maintaining a vigorous dialogue
in which they can share their opinions with thosehigher up.

Omura: The ¥500 billion revenue target is achievable if theexternal environment improves, but I think it won’t
be an easy matter to increase the operating income or operating income margin. To make those
improvements, you have to either increase yoursales prices or reduce your costs. The first option
is difficult to carry out in the manufacturing industry, and it comes down to how much you’re able
to utilize revolutions in technology like generative
AI. However, the second option of reducing costs
is something you can see in the numbers if you
implement automation and labor savings, and you
can also count on innovation in the realm of materials. I would like for THK to have a bold vision whenmoving forward rather than aiming for a reductionof a few percentage points. When I was taking another glance through THK’s 50th anniversary bookthe other day, my eye caught on the mention of apast instance when costs were reduced by 50%.
THK has generated new trends ever since its
founding, and I hope that every single employee

who has inherited that legacy will demonstrate aninnovative spirit as they work to achieve their targets.
Ueda:

The two strengths that Mr. Omura mentioned earlier, customer focus and innovation, are leading
to what THK has striven for: the construction of
ecosystems for the betterment of manufacturing.
In order to further capitalize on one of those eco, and other such businesssystems,
platforms in the future, it will be critical to increase
their global recognition. To borrow the CEO’s
words, our immediate challenge is to work “at the
speed of light” to make these platforms the defacto standard. I continue to value close communication and hope to be involved in deliberations
from the conceptual stage to help THK seize opportunities while keeping an eye on their timing and
M&A for the sake of acquiring market share andto make use of the expertise of outside directors,
even when making such decisions quickly.

36

THK Integrated Report 202 4

Principal Risks and THK’s Response
Risk Management
Based on our customer-focused approach where we think, act,

Defining and Responding to Risks

and verify results from the customer’s perspective, THK has es-

1. Each Group company and department in and outside oftablished an integrated sales and production structure with facili-

Japan identifies the risks they are aware of.

ties and operations close to centers of demand. As of December

2. Each company and department ranks the identified risks

31, 2023, our business has expanded to include 121 sales offic-

into five levels along the two axes of likelihood and impact.

es (47 in Japan, 74 outside of Japan) and 37 production facilities

3. The results of these assessments are reported to the Risk

(12 in Japan, 25 outside of Japan).

Management Committee Secretariat.

In order to fulfill our mission and responsibility to supply prod-

4. Based on the results from each company and department's

ucts as an essential business no matter the situation, we haveevaluation, the averages of the likelihood and impact are

established a risk management structure that controls all kinds ofcalculated and plotted on a risk map.

business risks, from natural disasters to terrorism, for each entity

5. Based on the results from each company and department’s

within the Group, whether in or outside of Japan, in accordance

evaluation, the risk score is calculated and represented

with our risk management regulations.

through the size of the circle on the map.
6. In consultation with the Risk Management Committee, we

Risk Management Systemdevelop countermeasures and verify the effectiveness of ourmanagement structure.

In order to gain an accurate understanding of every kind of risk
related to the business activities of the THK Group and to facili-

By taking the steps outlined above, we work to prevent risks

tate more appropriate risk-taking by executive staff, THK estab-

before they occur. Furthermore, in the event that a risk becomes

lished a Risk Management Committee headed by the President

a reality, we are strengthening our framework that enables us toand created a Group-wide risk management structure based

quickly launch a task force in response and promptly determine

on rules related to risk management. The committee establish-

countermeasures in order to minimize the impact to our busi-

es and formulates countermeasures to selected risks related

ness.

to the THK Group’s business activities and verifies whether theThrough the above process, we evaluated numerous possible

risk management structure is functioning in an effective manner.

risks to our business continuity and identified 11 items with highFurthermore, we consider risk to be an uncertainty that affects

severity. For these potential risks, we are constructing internal

the revenue of the organization, which may be negative or pos-frameworks to strengthen the positive impact and expand ouritive in nature. We believe that hedging risks as appropriate tobusiness (opportunities) in addition to minimizing the negative im-deal with the negative while actively taking positive risks will leadpact and taking mitigating measures (countermeasures).

to sustained future growth.

Risk Assessment Process

Risk Map
Main Risk Map Items
5.0

Evaluation

Identify risks

Creating arisk map
Risk
Management
Committee
Secretariat

Reportingand verifying
countermeasures
Risk
Management
Committee

Natural disasters/Large-scale incidents

Politics/Government/International relations

Countermeasure▲

Each location▲▲
Each location

Five ranks
along twoaxes

Analysis

4.0

ImpactReporting

Strategy/Marketing

Development/
Quality

Economy

3.0

Business partners

Legal/
Compliance2.0MarketTransport/Logistics

Finance/
Accounting
1.0

0.0

Customers
Competition

Crime/
Accidents

Structure/Corporate culture

Procurement

Information systems

Human resources/Labor/Health and safety
0.0

1.0

2.0

3.0
Likelihood

4.0

5.0

Governance

Involvement in Society

Harmony with
the Environment

Data Section

37

Risk Factors
Item

Compliance

Governance Information
security

Environment• Application of laws and regulations ineach country where THK is active• Loss of trust in THK due to a legal
violation

THK’s Response• Established the Compliance Committee• Prepared the THK Group Action Charter in 12 languages and distributed
it to all employees• Established the THK Group Helpline with three internal and externalreporting lines (Risk Management Department, Audit and Supervisory
Committee, and legal counsel)• Established system for locations in each region to share information about
legal and regulatory trends• Skilled, sophisticated cyberattack• Established Information Security Committee• Destruction or modification of data due to• Responded to Japanese and international regulations regarding theillegal accessprotection of personal information• Information leak due to system malfunc• Performed targeted e-mail attack drillstion• Negative impact on sales due to production stoppages• Disruption in component provision due tosuppliers or distribution networks suffering from a disaster• Implemented a crisis management service to understand the scope of the
impact from a disaster• Established an alternate production structure that includes global production facilities• Transferred headquarters functions when affected by a disaster• Developed robots that can enter collapsed buildings and those thatprovide contactless service to prevent the spread of disease

Competitors• Price competition with similar products• Recruitment of THK employees by othercompanies• Proposing electric and labor-saving products• Using Omni THK to understand market needs
that meet market• Developing products and services such as
requirements• Developing new products and cultivating new markets• Strengthening global collaboration

Global businessdevelopment• Current events in locations where THKor its suppliers do business, including
political and economic trends, terrorism,
and international conflicts• Established BCP measures to minimize harm
• Using a risk management service to quickly obtain local information

Raw materialand component
procurement• Insufficient production capabilities, quality
defects, or compliance violations on thepart of suppliers• Lockdowns in the countries where THK
does business• Supply chain disruptions due to a majordisaster• Sharp hikes in the prices of raw materials• Distributed the THK Green Procurement Guidelines• Supplier audits• Developing new technology through quarterly THK Association idea
exchanges and VA proposals• Expanding our global procurement network• Promoting recycling and reusing

Currency
exchanges• Drastic fluctuations in exchange rates• Estimated value of financial statementsfrom subsidiaries outside of Japan• Foreign exchange contracts• Expanding local procurement

Interest rates• Increased interest rates• Estimated value of assets• Derivative transactions such as interest rate swaps

Talent• Intense competition to secure excellent
talent• Worsened labor/management relations• Creating a work environment that welcomes diverse talent• Training program that utilizes e-learning• Creating an environment where women can thrive• Talent development program• Various benefit programs

Quality• Major quality incidents• Worsened supplier quality• Conducting supplier quality audits• Obtained ISO 9001, JIS Q 9100, and IATF 16949 certification

Environment• Stricter environmental regulations• Major environmental incidents• Distributed the THK Green Procurement Guidelines• Obtained ISO 14001 certification• Complying with RoHS Directive, REACH Regulation, and PRTR Law• Developing products related to renewable energy• Developing products to achieve carbon neutrality

Major disasters(including infectious diseases)

SocietyRisk

38

THK Integrated Report 202 4

Governance
Basic Policy
Intending to maximize our corporate value, we strive to maintain sol-provements to our corporate value by sustaining growth through ap-

id corporate governance in order to make medium- to long-term im-

propriate cooperation with all our shareholders and other stakeholders.

Structure
For our institutional design, in conjunction with our establishment of an

remuneration. We have also introduced an executive officer system.

Audit and Supervisory Committee, we also instituted a non-mandatory

In doing so, we have strengthened the auditing functions of theNominee Advisory Committee and a Remuneration Advisory Committee,

Board of Directors in addition to bringing greater speed and efficien-with half of the members of both committees being outside directors to

cy to management-related decision-making and the management of

ensure further transparency and fairness in management personnel andcorporate affairs.

Governance Structure
Election, dismissal
Cooperation,
reportGeneral Meeting of Shareholders
Election, dismissal
Auditing,supervision
Audit and Supervisory Committee

Independent Auditors

ReportReportSelection,
dismissal,
supervision

ReportReportCooperation
Risk Management
Department

Consultation

Board of Directors

Instruction

Audit and Supervisory
Committee Secretariat

ReportElection, dismissal

PresidentInternal Audit
Department

Auditing

ReportReportNomination Advisory Committee

Recommendation Remuneration Advisory Committee
Consultation
Recommendation
Consultation
Recommendation
Consultation
Recommendation

Risk Management Committee
Sustainability Committee

Compliance Committee

Instruction, supervision

Global Management Strategy Meeting

Auditing

Board of Executive Officers

Other Divisions, Departments, andAffiliated Companies

Divisions and Departments (Executive Officers)
Affiliated Companies (Executive Officers)

Auditing
Group Audit & Supervisory Board

Board of Directors

Audit and Supervisory Committee

THK’s Board of Directors comprises a total of nine directors—including two out-

Comprising three outside directors who are Audit and Supervisoryside directors—who are not members of the Audit and Supervisory Committee,

Committee members, the Audit and Supervisory Committee utilizes thein addition to three outside directors who are Audit and Supervisory Committee

internal control system to audit and supervise directors and executive

members. The Board of Directors makes decisions on important matters of general

officers with regard to the current status of the execution of their duties.

management and carries out the oversight of directors and executive officers in the

The committee enhances the effectiveness of audits throughexecution of their duties. There are also five outside directors whose independence

its partnerships with an accounting auditor, the Internal Audit

meets the evaluation criteria stipulated by the Tokyo Stock Exchange and THK.

Department, and the Risk Management Department, which main-

With over a third of the directors being outside directors who possess special-

tains and implements internal controls. Additionally, an Audit andized professional knowledge and qualifications related to corporate accounting or

Supervisory Committee Secretariat has been established to assist in

general management, this structure has further enhanced management neutrality,

the smooth functioning of the committee by supporting its members

legality, and validity while improving the board’s management oversight function.

and their work.

Governance

Involvement in Society

The Audit and Supervisory Committee Secretariat follows the instructions of the Audit and Supervisory Committee, coordinates witheach department, and conveys instructions to the Internal Audit
Department and the Risk Management Department.

Harmony with
the Environment

Data Section

39

The 2023 survey concluded that the Board of Directors demonstrates overall effectiveness.
In an effort to enhance this effectiveness and secure more time
for discussion, it was decided in 2023 that the Board of Directors
would no longer hold its meetings on the same day as the Board ofNomination Advisory Committee andRemuneration Advisory CommitteeThe

non-mandatory

Nomination

Advisory

Committee

Executive Officers. In principle, the Board of Directors now meetson days when other meetings are not being held. Furthermore, theandBoard of Directors has attained a deeper level of discussion around

Remuneration Advisory Committee are each composed of four di-measures for achieving THK’s 2026 management targets by conven-rectors, two of which are outside directors. This composition is ining four times a year for focused deliberation.

accordance with the rules for both committees, which stipulate that

To promote even livelier discussion among its members, the Board

outside directors must make up half or more of the members. As

of Directors has been challenged to reevaluate the items it deliber-advisory bodies to the Board of Directors, both committees review

ates upon.

and deliberate on director candidates and remuneration proposals,
and they propose the content and outcomes of those deliberations

We will continue to pursue further improvements to secure the effectiveness and bolster the performance of the Board of Directors.

to the Board of Directors. The Board of Directors conducts its own
deliberations on the subject matter before deciding on a resolution.

Executive Compensation
Basic Policy

Executive Officer System

It is our basic policy that the remuneration structure for directors (ex-By introducing the executive officer system, we have endeavoredcluding directors who are Audit and Supervisory Committee mem-to accelerate decision-making and operational execution, in addi-

bers and outside directors) will be tied to shareholder interests intion to improving the management oversight function of the Board

order to ensure that such compensation functions effectively as aof Directors and clarifying roles and responsibilities relating to thecontinued incentive to improve corporate value, and decisions on

management of corporate affairs. As a means to share information

remuneration for individual directors are based on an appropriate

throughout the Group and improve corporate governance throughstandard in consideration of their duties.

collaboration among the directors, executive officers, and othermembers of the management team, we have implemented our Board

Base Salaries

of Executive Officers, which is attended by directors and executive

Base salaries are determined based on the results of the previous

officers, and established the Global Management Strategy Meeting,fiscal year, with the combined sum of director salaries not to exceed

which is attended by members of the Board of Executive Officers in¥1.2 billion. Directors are evaluated based on their individual duties

addition to those in charge of each division, department, and affiliate

and both their current and expected contributions, and their basecompany. To clarify the roles and responsibilities of executive officers

salaries are accordingly determined and allotted from the aforemen-

relating to the management of corporate affairs, an executive officer’s

tioned collective sum. The annual base salaries of outside directors

term in office is deemed to be one year.

must remain under ¥120 million, and the amount is determinedbased on compensation standards for companies of a similar size,

Evaluating the Effectiveness of the Boardof Directors

industry, and type of business.

We conduct an annual survey on the capabilities of the Board of

Performance-Based Incentives

Directors in order to ensure its effectiveness and improve its per-The upper limit for performance-based incentives is the sum of 3%

formance. An external lawyer and the Secretariat of the Board ofof the profit for the year attributable to owners of the parent for that

Directors collect and analyze the results of the survey, and the five

period plus 3% of the average value of the profit for the year attrib-

outside directors discuss the analysis from an objective perspective

utable to owners of the parent for the past four years, including theand clarify the main points. After further deliberations on these results

current fiscal year, which is factored in to level out the variances in theby the Board of Directors, the effectiveness of the Board of Directors

demand trends for our business when determining the total amountis then evaluated.

of compensation for each fiscal year. Each director is evaluated, and40

THK Integrated Report 202 4

their compensation is determined within that limit in consideration ofCompensation Structure Policy

their duties and degree of contribution. Performance-based incen-

Based on a clear outline of business results and role-specific perfor-

tives are not provided to outside directors.

mance and responsibilities, base salaries are reevaluated on an annual basis and factor in company performance. Taking this amount into

Restricted Stocks

consideration, the ratio between base salary and performance-based

As an incentive to continuously improve THK’s corporate value, re-incentives is then determined based on the performance during thestricted stocks are provided to directors (excluding directors who are

current fiscal year, performance during the past four years, andAudit and Supervisory Committee members and outside directors).

contributions to overall management. This compensation structure

In order to align the interests of directors with those of shareholders,is decided by discussing the draft proposal with the Remunerationthese stocks may not be transferred except under specific circum-

Advisory Committee and considering their recommendations.

stances, and when such conditions are met, they will be allocated as

The number of restricted stocks is calculated at around 5% of thecommon stocks, which are subject to restrictions such as being allot-

sum of the applicable directors’ base salaries at the beginning. As

ted without contribution. Furthermore, based on a resolution by THK’stime goes on, this ratio is adjusted from the initial level to an appro-

Board of Directors, the annual sum when combined with the base sal-

priate amount based on changes in the management environment as

ary shall not exceed ¥1.2 billion (no more than ¥120 million of which

an incentive for directors to contribute to the continued improvement

may go to outside directors), and no more than 270,000 commonof THK’s corporate value, share the risks and rewards of stock priceshares may be allocated to directors (excluding directors who are Audit

fluctuations with shareholders, and possess a greater desire to help

and Supervisory Committee members and outside directors).

raise the stock price and improve corporate value.

Participation in Board of Director and Committee Meetings
Board ofDirectors(16/year)

Audit andSupervisory
Committee(13/year)Nomination Remuneration
Risk Management Sustainability Compliance
Advisory
Advisory
Committee
Committee
Committee
Committee
Committee(1/year)(4/year)(4/year)(3/year)(2/year)Akihiro Teramachi

100%

-

100%

100%

100%

100%

100%

Takashi Teramachi

100%

-

-

-

100%

100%

-

Hiroshi Imano

100%

-

-

100%

-

100%

100%

Toshihiro Teramachi

100%

-

100%

-

-

100%

100%

Nobuyuki Maki

100%

-

-

-

100%

100%

-

Junji Shimomaki

100%

-

-

-

-

100%

-

Kenji Nakane

100%*

-

-

-

100%

100%

-

Masaaki Kainosho

100%

-

100%

100%

-

100%

-

Junko Kai

100%

-

-

-

-

100%

100%

Masakatsu Hioki

100%

100%

100%

-

100%

100%

100%

Tomitoshi Omura

100%

100%

-

-

-

100%

-

Yoshiki Ueda

100%

100%

-

100%

100%

100%

100%

* Attended 13 of 13 meetings held after joining the Board of Directors

Governance

Involvement in Society

Harmony with
the Environment

Data Section

41

Internal Audits and Internal Controls
Internal Audits
As a matter of basic policy, the Internal Audit Department con-and the departments under audit. In 2023, these audits were in-ducts internal audits that contribute to management and the de-stead conducted through a combination of virtual and in-person

partments being audited. Internal auditors monitor the businessvisits at 74 offices and departments.

activities of each department as a group directly reporting to the
President that is independent from any other department.
The Internal Audit Department carries the dual responsibilities
of conducting internal audits and evaluating internal controls.

During evaluations of internal controls, internal controls related to financial reporting are evaluated based on the Financial
Instruments and Exchange Act. With the release of internal control reports, management evaluates the effectiveness of internal

During internal audits, the business activities of each depart-

controls and undergoes an audit by accounting auditors on an

ment and Group company are audited. These audits are gener-

annual basis. In 2023, the overall internal controls were evaluat-

ally performed on-site every year, and the results are summarized

ed at 22 locations, and the internal controls related to businessin an internal audit report and distributed to both management

processes were evaluated at 12 locations.

Internal Controls
In accordance with the Companies Act and the Ordinance for7. Structure for directors, employees, or individuals receiving

Enforcement of the Companies Act, we stipulate the following ina notification from such persons to report to the Audit andour Basic Policy for Internal Controls and maintain and operate
an internal control system.

Supervisory Committee
8. Controls for ensuring that no one receives unfavorable treatment on the basis of their having made a report to the Audit

1. Controls to ensure that the execution of duties among THKGroup directors and employees conform to laws and thearticles of incorporation
2. Matters concerning the storage and management of information related to the execution of director duties
3. Regulations and other controls concerning the risk of loss
for the THK Group
4. Controls to ensure the efficient execution of duties among

and Supervisory Committee
9. Matters relating to the policy for advance payment or reimbursement of expenses arising from the execution of duties
among directors who are Audit and Supervisory Committee
members and the processing of expenses or debts arisingfrom the execution of other such duties
10. Other controls for ensuring effective auditing by the Audit
and Supervisory Committee

THK Group directors
5. Controls to ensure the appropriateness of THK Group operations

Furthermore, the operational status of the internal control system is reported to the Board of Directors annually, and that infor-

6. Matters related to ensuring the effectiveness of structuresmation is included in business reports and the Annual Securities

relating to employees whose appointment was requested toReport. The current version of the Basic Policy for Internal

assist the Audit and Supervisory Committee, the indepen-Controls can be viewed on the THK website.

dence of those individuals from directors (excluding directors who are Audit and Supervisory Committee members),
and directions issued to those individuals

42

THK Integrated Report 202 4

Compliance
PolicyThoroughly instill compliance awareness and create a work environment that does notallow wrongful acts.

tures and conduct various programs with the aim of complying

Distribution of the “Fundamentals for the
THK Group Employees” Booklet

with laws, internal standards, and ethical norms.

“Fundamentals for the THK GroupTo thoroughly instill compliance awareness, we maintain struc-

Employees” contains our Corporate

Compliance Structure

Philosophy, Corporate Basic Policies

The Compliance Committee is headed by the President and con-(creating value and contributing tovenes four times a year. This committee, which is composed ofsociety,outside directors and a legal advisor, approves the annual activity

and compliance with laws and regu-

plan and reports on the execution of those activities, as well as

lations), and The THK Group Action

on the handling of compliance violations by employees and otherCharter. This booklet is distributed tomatters reported internally.

all employees in an effort to ensure

being

customer-oriented,

they always perform their work ap-

Compliance Structure

propriately without losing sight of theirCompliance Committee
Chair: President
Observers

Committee Secretariat

Outside directors
and legal advisor

Risk Management
Department

mission, and it is available in a total of 12 languages (Japanese,
English, Traditional and Simplified Chinese, German, French,
Czech, Portuguese, Spanish, Thai, Malay, and Vietnamese).

Compliance Subcommittees
Members selected from each office

THK Group Helpline (Internal Reporting System)
The THK Group Helpline was established to prevent complianceviolations and to enable quick and appropriate action in the eventof an employee committing a violation. There are two internal
contacts (the Risk Management Department and the Audit andSupervisory Committee) and one external contact (our legal advisor) for reporting, and reports can be made anonymously. We
faithfully enforce our rules ensuring confidentiality regarding thecontents of reports and prohibiting unfavorable treatment on thebasis of having made a report. There were 21 cases reported
in 2023, and we worked with the necessary divisions to handle
each case appropriately. The THK Group Helpline is advertised in
the four issues of the THK GROUP NEWS published each year,
as well as through posters in company cafeterias.
5 Tips for Good Communication:
1: Give others a bright and cheerful greeting!
2: Get to know others through casual conversation!
3: It takes a team to get work done. Share ideas as a group!
4: Communicate problems quickly and accurately!
5: Don’t struggle alone. Ask for help!

Governance

Involvement in Society

Harmony with
the Environment

Data Section

43

THK Group Helpline Flowchart
THK Employee
Contact andconsult witha superior
DiscoverreportableactNo
improvement or
unresolved
Reportaccepted

Difficult or
impossible tocontact andconsult witha superior

THK
Group

Subsidiary Company Employee
Contact andconsult witha superior
DiscoverreportableactNo
improvement
or unresolved

Helpline
Helpline ofsubsidiarycompany

Helpline

Receipt
andconsideration

Additional
confirmation withoriginal
party

No
improvement
or unresolved
Not
accepted

Difficult or
impossible tocontact andconsult witha superior

Difficult or
impossible touse subsidiarycompany
helpline

Notifyoriginal
party

Direct investigating
department
to investigate

Report toCompliance
Committee

Receive
writtenreport ofinvestigation results

Extraordinary
measuresReport action
results tooriginal party

Create aninvestigation
and action
team within the
Compliance
Committee

Notifyoriginal
party alongwith reason

2023 Activities Report
Annual plan

Preventing illegal and wrongfulacts that would significantly
impact operations

Improving knowledge andawareness of compliance

Compliance readinessself-audit

Details

ResultNew-hire training

Basic compliance training was conducted as appropriate for newhires at the majority of THK Group facilities, including THK Japan,
Group companies in Japan, and Group companies outside of Japan.

Harassment training seminars

Training seminars on workplace harassment and appropriate formsof communication were conducted throughout the year at THK
Japan and Group companies both in and outside of Japan

Seminars on compliance andharassment

Seminars on the basics of compliance, workplace harassment, andappropriate forms of communication were held from September toDecember for a total of 571 employees across THK Japan production facilities and Group companies in Japan.

Harassment seminar for
directors and executive officers

A harassment seminar conducted by an outside director and a report on THK’s harassment prevention initiatives were conducted for
26 directors and executive officers in September.

Seminar on the Act Against
Delay in Payment of
Subcontract Proceeds

A seminar giving an overview of the Act Against Delay in Payment of
Subcontract Proceeds and key points for compliance was conducted for 11 employees at the Atsugi branch in October.

Compliance Subcommittee
Member Seminar

A seminar on communication methods for preventing harassment was conducted by an outside lecturer for 46 Compliance
Subcommittee members in October.

Provision of e-learningmaterials

Content covering countermeasures for targeted e-mail attacks wasadded in August.

Published quarterly“Compliance Tips”

Relevant examples of legal violations were published quarterly tofoster greater compliance awareness among employees (four publications).

A compliance survey was
conducted

In order to identify and improve compliance readiness issues, a compliance survey was conducted among employees in October.

44

THK Integrated Report 202 4

Anti-Bribery
Previously, the THK Group had worked to prevent bribery inutives, employees, and suppliers, the THK Group requests that

accordance with the THK Group Action Charter. However, as

they do not engage in any acts that are or may be in violation oflaws surrounding bribery and disclosures are becoming stricter

anti-bribery laws or this policy in the course of conducting busi-

around the world, we have deemed it necessary to further clarify

ness and transactions with the THK Group. If anyone becomes

the THK Group’s stance on bribery prevention as we promoteaware of an act that occurred during a business dealing or trans-various activities, and have therefore established the THK Groupaction with the THK Group that either is or may be in violation of

Anti-Bribery Policy, which forms the base of our good-faith busi-

such regulations, we ask that they promptly notify the relevant

ness practices.

THK Group company and provide their full cooperation with any

In addition to asking our business partners to disseminate thecontents of anti-bribery laws and this policy among their exec-

investigation performed by the THK Group company or the relevant legal authorities of each country.

THK Group Anti-Bribery Policy
Established December 2021

Based on the fundamental principle of prioritizing legal compliance over short-term gains, the THK Group adheres to the following provisions as it promotes efforts to prevent bribery.
1 Prohibition of Bribery(1) The THK Group does not directly or indirectly commit bribery, nor make offers or promises thereof to anyone.
(2) The THK Group does not make facilitation payments (small bribes for the purpose of expediting administrative procedures) to public
officials or those in equivalent positions (hereinafter referred to as “Public Officials”).
(3) The THK Group pays heed to the particular laws of each country and region, including those that forbid bribery toward private
enterprises in addition to Public Officials, and adheres to applicable anti-bribery laws in the execution of its business.
(4) In recognition that any bribery committed by a representative or business partner (hereinafter referred to as “Business Partners”)
may be considered bribery on the part of the THK Group, the THK Group does not instruct its Business Partners to commit bribery.
Furthermore, the THK Group does not tolerate any actual bribery on the part of any Business Partners, or indications thereof, of
which the THK Group is aware.
2 Establishment, Operation, and Internal Auditing of an Anti-Bribery Management Structure
In order to promote the anti-bribery efforts established in this Policy, the THK Group evaluates the risk of bribery within the Group andestablishes rules related to the prevention of bribery at each Group company in accordance with the characteristics and risks present
in each country and region, and the THK Group regularly monitors, inspects, and evaluates whether those rules are being correctly applied. Furthermore, the THK Group reevaluates the anti-bribery management structure in accordance with the results of the evaluation.
3 Thorough Execution of Bribery Prevention and Dissemination of Information
The THK Group conducts training for executives and employees as well as utilizing other means to disseminate information and deepen understanding of bribery prevention.
4 Exercise of Due Diligence and Introduction of Anti-Bribery Provisions
The THK Group exercises due diligence before engaging in business with the Business Partners of each Group company and strives
to introduce anti-bribery provisions into agreements with such Business Partners.
5 Thorough Management of Records
The THK Group accurately records all transactions in its accounting books and appropriately stores all related materials.
6 Maintenance of a Helpline and the Obligation to Report
The THK Group maintains a helpline and reporting line in order to detect bribery and other such acts at an early stage. Furthermore, all
THK Group executives and employees are required to quickly file a report if they have discovered bribery or another such act.
7 Emergency Response
In the event that a major compliance violation related to bribery is made known, the THK Group promptly and appropriately conducts
an investigation and takes other necessary actions. Furthermore, the THK Group earnestly handles any requests to cooperate withinvestigations conducted by law enforcement in each country.
8 Penalties
The THK Group deals severely with any executive or employee that has violated anti-bribery laws or this Policy in accordance with theinternal regulations of each Group company.

Governance

Involvement in Society

Harmony with
the Environment

Data Section

45

Information Security
Establish, instill, and maintain the THK Group information security structure.

PolicyWhile information utilization is indispensable for corporate growth
in modern society, security risks associated with that same information are also growing. Companies can lose trust and experience extensive losses from a single information leak. As
THK strives to strengthen its company-wide information security

Information Security Structure
Information Security Committee
Chair: President
Observers

Committee Secretariat

ness.

Outside directors andlegal advisor

Risk Management
Department

Information Security Structure

Information administrators
Managers of each department/officestructure, it also works to increase the level of employee aware-

The Information Security Committee, chaired by the President,
convened four times this year. This committee, which is attended

Designate

Information
managers

Each department/officeby outside directors and legal counsel, made decisions concerning policies related to the establishment of an information security structure and discussed responses to information security
concerns.

2023 Activities Report
Annual plan

Increasing information security
awareness

Continual improvement of theinformation security structure

Details

ResultPerformed targeted e-mailattack drills

A total of 362 employees from select departments were part of targeted e-mail attack
drills conducted in August that replicated an attack on the company.

Conducted training

Throughout the year, courses on basic information security knowledge were held forapproximately 160 people, including new hires and other employees from various
departments, at THK INTECHS Sendai.
In August, a lawyer was invited to hold a training session on regulations concerning
information leaks for 40 related members at THK Wuxi.

Performed information security
auditsInformation security audits were performed in May and December for the sake ofverifying adherence to rules related to information security and supporting improvements at each facility and in each department, and no issues were observed withregard to operations.

Performed information security
self-assessment

In October, employees were given an information security self-assessment meant tohelp identify and improve on problems with the information security structure.

Identified specific weaknesses

In December, TME (France) worked with consultants to identify specific weaknesses
in its systems and infrastructure, which included:• Physical infiltration• System infiltration from within the company• System infiltration from outside of the company• Analysis of systems and processes related to security

Strengthened backup structures

TME installed two new data servers and one new backup server. Using real-time
server replication, they constructed a backup impervious to infiltration to curtail therisk of ransomware and data loss.

Strengthening infrastructure
equipment

46

THK Integrated Report 202 4

Risk Management Structure
PolicyWe facilitate assertive governance with elements of bold risk-taking.

We maintain a forward-looking risk management structure thatand created a Group-wide risk management structure. The Risk

actively involves management in order to support risk-taking by

Management Committee convenes annually. They approve theexecutive staff.

annual activity plan and work to establish, promote, and maintainthe risk management structure by controlling risks in all of the

Risk Management StructureGroup’s business activities.

The Risk Management Department was established directly
beneath the President as a means to control and respond torisk throughout the company. This department is split into legal,internal control, security export control, compliance, and environmental management sections, which develop measures for

Risk Management Structure
Risk Management Committee
Chair: President

avoidance, mitigation, and transfer of every foreseeable risk intheir respective areas.
In order to gain an accurate understanding of every kind of risk
related to the business activities of the THK Group and to facili-

Observers

Committee Secretariat

Outside directors
and legal advisor

Risk Management
Department

tate more appropriate risk-taking by executive staff, THK estab-

BCP Promotion Council
Chair: Production General Manager

lished a Risk Management Committee, which is headed by theMembers selected from each office

President and composed of outside directors and legal counsel,

2023 Activities Report
Annual plan

Review of everyday
prevention activities

Verification ofcross-held stocks

Details

ResultRisk assessment of THK businessactivities

The known risks of 30 departments across THK were ascertained, identified, categorized, and evaluated.

Risk assessment of THK Group
company business activities

The known risks of 29 Group companies in and outside of Japan were ascertained,
identified, categorized, and evaluated.

Analysis of risk assessment results

Risks were mapped according to their probability and impact based on the aggregated results of the risk assessments of each company and department. The severityof each risk to the THK Group was thus evaluated, and the priority for implementing
countermeasures was determined.

Report to management

The results of the risk assessments were reported to the Board of Directors.

Verification of primary cross-heldstocksThe medium- to long-term financial sense and future outlook of primary cross-heldstocks were verified.

Governance

Involvement in Society

Harmony with
the Environment

47

Data Section

BCP
As a company that supports industry around the world, it is our essential social responsibility
to minimize any negative impact on society by fulfilling our responsibility to supply parts evenin the event of unforeseen disasters.

PolicyTHK is aware that more natural disasters that have a large impact

cy. At present, in accordance with this policy, we are focusing

on business continuity occur every year, and our existing BCP

on crucial preventive measures for mitigating the largest risks

must evolve in response.

imaginable in a scenario where we continue to produce during
a disaster. Considering the largest risks that can be anticipatedEarthquake Protection

from a predicted future Nankai Trough earthquake, however, risk

The earthquake that struck the Noto Peninsula at the very be-finance has been deemed a necessity. This has led us to con-ginning of 2024 and its ensuing aftershocks, as well as earth-sider risk transfer in the form of earthquake insurance centeredquakes in other regions, escalate the necessity of earthquakeon production facilities in regions we anticipate will be affected.

safeguards and drills going forward. Because tectonic uplift and

THK is currently seeking out an optimal solution for itself and its

subsidence are daily occurrences, we have looked into creat-

stakeholders based on a relative evaluation of the cost of risk anding and rehearsing hourly action plans to use in the event of an

the impact that enrolling in this insurance will have on corporate

earthquake warning issued by the government or a public agen-value.

Appoints
Instructs/
Reports to

Appoints
Appoint Response
Division Deputy
General Manager

Establish
Response Division

Appoint Response
Division General Manager

Executive Officers︵ in the Presidentʼs absence︶

President

Headquarters (Risk Management Department, Human Resources & General Affairs Department, President's Office, etc.)

Instructs/Notifies

Notifies

Instructs/
Reports toEstablish Local
Secretariat

Supervisor

Witness

Initial report

Head of The
Presidentʼs Office

Emergency Situation

Per regulations

Local Response Group
Response Division

Instructs/
Reports to

Secretariat

Local Response Group
General Manager

Report to authorities

Establish Local
Response Group

Emergency Response Process* When the President is unavailable, the Deputy General Manager will be determined by the executive officers.

2023 Activities Report
Annual plan
Active shooter training(THK America)

Details

ResultPresentation on the best ways tosurvive an incident where a firearmis used to commit untargeted acts ofmurder in the workplace

The course was taught by local law enforcement. THK America headquarters
invited police to teach the course for 120 in-person attendees and 10 individuals from other sales offices who joined online.

48

THK Integrated Report 202 4

Directors and Executive Officers
Board of Directors and Executive Officers (As of March 16, 2024)
Directors

Executive Officers
Managing Executive Officers

Naoki Kinoshita

Executive Vice Chairman of THK (CHINA) CO., LTD.
President of THK (CHINA) CO., LTD.

Nobufumi Sato

President of THK America, Inc.

Kaoru Hoshide

Senior General Manager of Engineering Division,
Industrial Machinery Headquarters

Masaki Sugita
Akihiro Teramachi
Chairman and CEO

Takashi Teramachi
President and COO

Hiroshi Imano

Executive Vice PresidentGeneral Manager of Service Robot Division,
Industrial Machinery Headquarters

Tetsuya Hayashida

Special Appointive Officer to President

Takanobu HoshinoGeneral Manager of IMT Division,
Industrial Machinery HeadquartersDirector and Executive Vice Chairman of THK INTECHSCO., LTD.

Toshiki Matsuda

Representative Director and President of THK Europe B.V.
Representative Director and President of THK GmbH
Representative Director and President of THK France S.A.S.
Representative Director and President of THK Manufacturingof Europe S.A.S.

Masato Sawada

General Manager of Automotive & Transportation HeadquartersDirector and Executive Vice Chairman of THK RHYTHM
CO., LTD.

Toshihiro Takahashi

Senior General Manager of Production Division,
Industrial Machinery Headquarters

Toshihiro Teramachi
Executive Vice President and CIO

Nobuyuki MakiDirector and Senior Managing
Executive Officer
Senior General Manager ofAutomotive & Transportation
Headquarters

Junji ShimomakiDirector and Senior Managing Executive
OfficerGeneral Manager of Industrial Machinery
Headquarters Responsible for Sales

Yutaka Nakano

Senior General Manager of LM System Sales Division,
Industrial Machinery Headquarters

Takuya Sakamoto

Senior General Manager of FA Solution Sales Division,
Industrial Machinery Headquarters
Head of IOT Innovation Division

Yukio YamadaGeneral Manager of LM System Sales Division,
Industrial Machinery Headquarters
General Manager of International Sales Department,
LM System Sales Division, Industrial Machinery Headquarters

Takehiro NakanishiGeneral Manager of Production Division,
Industrial Machinery Headquarters
General Manager of Global Procurement Department,
Production Division, Industrial Machinery Headquarters

Executive Officers

Masaki Kimura
Kenji Nakane

Director, CFO, and Executive OfficerGeneral Manager of Finance &Accounting Department, Corporate
Strategy Headquarters
General Manager of Indirect Material
Procurement Department, Corporate
Strategy Headquarters

Masaaki Kainosho
Outside Director (Independent)

Junko Kai

Outside Director (Independent)

Head of The President’s OfficeHead of Corporate Planning Department,
Corporate Strategy Headquarters

Katsuya Iida

Head of Product Planning Department,
Industrial Machinery HeadquartersHead of Engineering and Development Department,
Engineering Division, Industrial Machinery Headquarters
Head of Engineering Division, THK (CHINA) CO., LTD.

Katsumi FujitaGeneral Manager of Human Resources & General Affairs
Department, Corporate Strategy Headquarters

Akihiko Kambe

President of THK NIIGATA CO., LTD.

Akira FurihataRepresentative Director and President of THK RHYTHM
CO., LTD.
President of TRA Holdings CO., LTD.

Toshihiko Enomoto
Masakatsu Hioki

Outside Director (Independent)(Audit and Supervisory
Committee Member)

Tomitoshi Omura

Outside Director (Independent)(Audit and Supervisory
Committee Member)

Yoshiki Ueda

Outside Director (Independent)(Audit and Supervisory
Committee Member)General Manager of Production Division,
Industrial Machinery Headquarters
General Manager of Production Engineering Department,
Production Division, Industrial Machinery Headquarters
Director of THK INTECHS CO., LTD.
Director of THK MANUFACTURING OF CHINA(CHANGZHOU) CO., LTD.

Governance

Involvement in Society

Harmony with
the Environment

49

Data Section

The Selection of Outside Directors
Masaaki Kainosho

Reason for selection

Masaaki Kainosho has a wealth of experience, a history of success, and soundjudgment as a manager of an executive consulting company and a university professor deeply versed in business administration.

Significant concurrent positions:Representative Director of KAINOSHO CO., LTD.

Independent status
and additional comments

Masaaki Kainosho was employed at THK’s current lender, Sumitomo Mitsui
Banking Corporation (previously Mitsui Bank), from April 1976 to April 1996.
However, he was consistently working in a systems-related division, and the THKGroup did not do business with Mitsui Bank at the time. Therefore, he is considered to be independent.

Junko Kai

Reason for selection

In addition to the legal knowledge that she has cultivated over her many years
as a lawyer, Junko Kai is a legal expert who possesses a wealth of experience,a history of success, and sound judgment.

Independent status
and additional comments

Although she does not have direct experience in corporate management, theCompany has determined that she appropriately executes her duties as an
outside director because of the aforementioned reasons.

Reason for selection

In addition to possessing sound judgment, Masakatsu Hioki has extensive
experience and a proven history of success as an executive responsible
primarily for human resources and general affairs at a global manufacturing
company.

June 2012
Became Outside Director of THKMarch 2022
Became Outside Director of THK
Significant concurrent positions:
Partner at Hamani, Takahashi & Kai Law Firm
Outside Director of Narita International Airport
Corporation
Outside Audit & Supervisory Board Member at
JSR Corporation

Masakatsu Hioki

June 2014
Became Outside Director of THK
June 2016
Became Outside Director of THK and Audit andSupervisory Committee Member

Independent status
and additional comments

Significant concurrent positions:
Outside Director of SUKIYA Co., Ltd.
Outside Director and Audit and Supervisory
Committee Member of ZUIKO CO., LTD.

Tomitoshi Omura

June 2016
Became Outside Director of THK and Audit andSupervisory Committee Member
Significant concurrent positions:Certified Public Accountant
Managing Director of Omura Accounting Office

Yoshiki Ueda
June 2016
Became Outside Director of THK and Audit andSupervisory Committee Member
Significant concurrent positions:
External Director and Chairman of SINTOKOGIO,LTD.

Masakatsu Hioki began his career with Komatsu Ltd. Although THK and
Komatsu do have a business relationship that includes the sale of THK
products, the sum value of those transactions equals less than 1% of THK’s andKomatsu’s consolidated net sales for the corresponding fiscal year. Therefore,
he is considered to be independent.

Reason for selection

In addition to the knowledge of corporate accounting he has gained over many
years as a certified public accountant, Tomitoshi Omura is an accounting expert who
possesses a wealth of experience, a history of success, and sound judgment.

Independent status
and additional comments

Although he does not have direct experience in corporate management, theCompany has determined that he appropriately executes his duties as an
outside director because of the aforementioned reasons.

Reason for selection

In addition to possessing sound judgment, Yoshiki Ueda has extensive
experience and a proven history of success as an executive deeply versed incorporate management, having spent many years at a global company active inmachinery-related fields.

Independent status
and additional comments

Yoshiki Ueda is an External Director of SINTOKOGIO, LTD. Although THK and
SINTOKOGIO do have a business relationship that includes the purchase of
SINTOKOGIO products, the sum value of those transactions equals less than
1% of THK’s and SINTOKOGIO’s consolidated net sales for the corresponding
fiscal year.

Skill Matrix
Corporate
management
Akihiro Teramachi●

Takashi Teramachi●

Hiroshi Imano●

Toshihiro Teramachi●

Nobuyuki Maki●

Finance andaccounting

Governance and risk
Global business
management●●●

Junji Shimomaki
●

●

●

●

●

●

●

●

●

●

●

●

●

●

●
●

Masakatsu Hioki●●

Tomitoshi Omura●

Development,
engineering, andmanufacturing●●●

Junko Kai

Yoshiki Ueda

DX and IT●●

Kenji Nakane
Masaaki Kainosho●

Sales andmarketing

●
●

●
●

●

●

●

50

THK Integrated Report 202 4

Procurement
Policy for 2023
1. Global procurement and optimizing procurement locations
Policy2. Accelerating work speed and boosting work efficiency with DX
3. Establishing a structure with suppliers to increase production and promoting improvement
activities

At the same time as THK promotes material procurement that

activities to increase productivity and create competitively priced

matches demand for the sake of optimizing production locations,products.

we also communicate with suppliers and pursue improvement

Procurement Structure
As THK endeavors to strengthen its BCP by making its value

Subcontract Proceeds, Etc. to Subcontractors, to promote fairchain more resilient through purchasing from multiple suppliers,

and impartial business dealings. Through the THK Association,

and as the development of global procurement and produc-

we also work to maintain an exchange of information among ourtion location optimization accelerates, we continue to work tobusiness partners.

comply with laws, such as the Act against Delay in Payment ofPartnership Building Declaration
Having declared in August 2022 our intent to strengthen ourand engage in product improvement toward the shared goal of

business partnerships by building new mutually beneficial re-continuing to supply custom-

lationships, we aim to create positive growth and distribution

ers with satisfying products.

cycles. Positioning suppliers as key partners for accomplishingmutual growth, THK continues to build cooperative structures
Partnership Building Declaration

2023 Activities Report
Annual plan

Details

ResultConvening THK Association meetings

Cooperative association meetings for exchanging
information

14 sessions held

VA proposal submissions (Goal: 1,100)

Promotion of proposals and improvement activities

1,533 proposals

Die status confirmations

Confirming the status of die inventory and exchanging
information

7 companies visitedGovernance

Involvement in Society

Harmony with
the Environment

Data Section

51

CSR Procurement Guidelines
Dealing with the supply chain as a whole is crucial for our Basic

Items along the entire supply chain that need to be addressed

Sustainability Policy of enhancing corporate value through ourare summarized in THK’s CSR Procurement Guidelines, which arecore business and building a sustainable and affluent society.

distributed to and acknowledged by all partnering companies.

THK Group Supplier CSR Procurement Guidelines
1. Compliance
Comply with all laws and engage in fair trade and business activities with ahigh sense of ethics.
• 1-1 Early Detection and Handling of Wrongful Acts
Maintain internal reporting and other systems in order to promptly detect andhandle wrongful acts.
• 1-2 Protection of and Respect for Intellectual Property Rights
Take sufficient care to ensure that your company’s intellectual property rights
are not infringed and that you do not infringe the intellectual property rights
of others.
• 1-3 Security Export Controls
Maintain the systems necessary to comply with security export control regulations.
• 1-4 P rohibition of Anti-Competitive Behavior and Abuseof a Dominant Bargaining Position
Do not engage in behaviors that impede fair, transparent, and free competition or those that cause any detriment by abusing a dominant bargaining
position.
• 1-5 Prohibition of Corruption and Bribery
Establish highly transparent relationships with political and administrative
organizations and avoid providing gifts or entertainment to public figures forthe purpose of obtaining an unfair advantage.
• 1-6 Prohibition of Giving or Receiving Inappropriate Advantages
Do not conduct insider trading, and do not provide or receive gifts of moneyor entertainment far exceeding the realm of social etiquette.
• 1-7 Refusal of Ties with Criminal Organizations
Resolutely reject and refuse ties with criminal organizations.

2. Human Rights
Conduct business in a manner that respects the rights that allow people tolive happily.
• 2-1 Prohibition of Inhumane Treatment
Prohibit cruelty, corporal punishment, sexual harassment, power harassment, and all other forms of inhumane treatment.
• 2-2 Prohibition of Forced Labor
Prohibit bonded labor, slave labor, and all other forms of forced labor, andrecognize the right of employees to freely terminate their employment.
• 2-3 Prohibition of Child Labor, Etc.
Do not employ children under the age of 15, and do not assign duties to
employees under the age of 18 that may harm their health or safety.
• 2-4 Prohibition of Discrimination
Provide equal opportunities and do not discriminate in terms of employment
or treatment without reasonable cause.
• 2-5 Responsible Mineral Procurement
Carry out investigations and make efforts to promote the non-use of any
conflict minerals (tantalum, tin, tungsten, and gold) that act as a sourceof funds for armed insurgents carrying out human rights violations in the
Democratic Republic of the Congo and surrounding countries.

3. Occupational Health and Safety
Maintain a workplace environment that is comfortable and safe for employees
to work in.
• 3-1 Dialogue with Employees
Have dialogues with employees or their representatives directly and in goodfaith.

• 3-2 Management of Work Hours
Manage employee work hours to ensure they do not exceed legal limits, andpromote employee work-life balance.
• 3-3 Appropriate Wages
Comply with wage regulations.
• 3-4 Creation of a Safe and Healthy Workplace
Promote health and safety activities in the workplace and be considerate of
employee health.

4. Safety and Quality of Products and Services
Develop, manufacture, and deliver products and services that are safe andreliable.
• 4-1 Safety and Quality of Products and Services
Provide products and services that satisfy THK Group safety and quality
standards.
• 4-2 Quality Management
Maintain the necessary systems to promote product and service quality
management.

5. Information
Thoroughly protect and manage various kinds of information and actively disclose information as required.
• 5-1 Information Disclosure
Appropriately disclose information in a timely manner in the event of the
discovery of a legal violation that may significantly impact management andfinancial information or transactions.
• 5-2 Information Security
Maintain information security systems to appropriately protect and manage
confidential, personal, and other information related to your company andother parties.

6. Environment
Maintain systems to promote environmental conservation, establish internalgoals, and conduct activities to achieve those goals.
• 6-1 Promotion of Global Warming Countermeasures
Strive to reduce greenhouse gases and use energy in an efficient manner.
• 6-2 Minimizing Environmental Impact
Manage the discharge of waste water, sludge, exhaust, and waste produced
from your business activities as necessary.
• 6-3 Promotion of Resource and Energy Conservation
Promote reducing, reusing, and recycling the resources and energy used inyour business activities.
• 6-4 C ompliance with Environmental Laws and Administrative
Procedures
Understand the environmental laws related to your business activities, follow
the necessary procedures, and seek to obtain the latest information.
• 6-5 Manage Chemicals Contained in Products
Comply with THK Group and other standards related to chemicals containedin products.

7. Business Continuity Plan
Strive to establish a business continuity plan to quickly resume operations in
the event of an emergency situation such as an earthquake or another natural
disaster.

8. Contributing to Local Areas and Society
Strive to actively implement initiatives that will improve relations with the local
area and society.

52

THK Integrated Report 202 4

Quality Assurance: Trust, Reliability, and Safety
PolicyWe supply reliable and safe products of superior quality to all customers and provide a complete quality assurance system with global considerations in mind.

Quality Assurance Structure
THK has established a quality assurance system in which eachproduction facility both in and outside of Japan is certified with
the ISO 9001 Quality Management System. We provide a quality
assurance system for the industrial machinery business that produces components used in machine tools, semiconductor manufacturing equipment, medical devices, robots, logistics equipment, and seismic isolation and damping systems. With this as
our base, we obtain certifications in quality standards adapted
for new fields such as the automotive and transportation business and the aerospace industry.
We also work with each of our suppliers to accomplish environmentally conscious manufacturing that takes ESG and the

Quality
System Overview
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SDGs into consideration.
The following initiatives are being undertaken to strengthen
quality at THK.
1. Strengthening design quality
As part of managing our product development process, we
review the solutions implemented for any issues during the planning, design, prototype, trial, and mass-production stages, andwe work to manage the stability and maintenance of quality levels after mass production.
2. Strengthening product quality
We have established a system that allows quality data to beshared globally. In addition to gathering feedback from customers in each region, analyzing it, and providing rapid and appropriate service as a manufacturing and innovative services company,
we endeavor to develop products that meet market needs andimprove quality.
3. Strengthening production quality
We endeavor to enhance the quality of the measurements wetake, keeping error to a minimum, by implementing optimal measuring equipment necessary for maintaining product quality.
4. Strengthening talent development
In order to make products that are reliable and safe, we strive
to develop talent in the areas of product knowledge (technology),equipment handling (technique), and optimal production (quality).

Quality Management Process

1. Development and
Design ursue function, performance,Pand solutions● Tribology● Material technology● Environmental contributions●

3. Purchasing,
Production, andInspection

2. Testing andInvestigation
 esign review
DMass production approval● 
Analysis and analytical ability●● ursue uniform quality all overP
the world● 
Establish process capability● 
Production engineering ability●

4. P roviding Service
and Gathering
Quality DataImprove customer
satisfaction● Utilize IoT service●

Quality Structure Improvement Timeline

ISO 9001 quality
management system
certification

Up to 2000
1994: Yamagata and Kofu
1995: Yamaguchi
1996: Mie1997: Gifu and THK RHYTHM Hamamatsu
and Kyushu
1999: THK INTECHS Mishima and Sendai

5. A
 nalysis of Quality
Data and Feedback●

1

2001 to 2010
2001: THK America1
2003: THK NIIGATA and THK RHYTHM Inasa
2004: TME (France) and DALIAN THK (China)
2006: TMA (USA), THK WUXI (China), and TMI (Ireland)
2007: THK LIAONING (China)
2009: THK RHYTHM Thailand

JIS Q 9100
aerospace industry
certification

2004: THK NIIGATA

IATF 16949
automotive industry
certification

2004: THK RHYTHM North America
2005: THK RHYTHM Hamamatsu, Inasa, and Kyushu
2006: TMA (USA)2009: THK RHYTHM Thailand and Guangzhou (China)

 valuate qualityE
improvements andmarket needs

Sales office (all others are production facilities)
2011 onward
2016: TMV (Vietnam)
2018: THK CHANGZHOU (China)

2011: THK RHYTHM Malaysia
2014: THK RHYTHM Changzhou (China)
2016: THK RHYTHM Mexico
2019: Yamagata

GovernanceHarmony with
the Environment

Involvement in Society

Data Section

53

Shareholders and Investors
Mindset
THK engages in IR activities in an effort to disclose information

information through events such as financial results briefings andin a manner that is fair, impartial, expedient, accurate, and easy

IR meetings, the investor relations section of our website, and theto understand. We strive to provide more thorough and valuable

Integrated Report.

IR Activities
While many Japanese companies have normalized holding theirkets. As a specific example of their efforts, in addition to having

shareholder meetings on the same day, in an aim to have open

the top executives present the company’s results and strategy atmeetings where more shareholders can participate, THK has

a semiannual financial results briefing, those executives’ visits toconvened its General Meeting of Shareholders on a Saturday

institutional investors overseas that began in 2000 were turnedin mid-March (mid-June prior to 2017) every year since 1998.

into a routine* practice. This has resulted in the percentage of

Furthermore, an exhibition is held after the General Meeting of

foreign-owned shares increasing from 23.2% in the 1999 fiscal

Shareholders in order to deepen shareholders’ understanding ofyear to 39.8% in the 2023 fiscal year. THK will continue striving to

THK’s business.

be a company that is evaluated highly on a global stage throughIn addition, an IR Department was established directly beneaththe President’s Office in 2002 as a means to reduce management

its various IR activities.
* This practice was discontinued after 2020 due to the coronavirus pandemic.

risks and strengthen the dialogue between THK and capital mar-

The IR Website
IR Library
In addition to documents related to financial statements, including “Investor Information” compiled from summaries of financial
results and detailed financial data, the library also includes theIntegrated Report. Presentation materials and videos are available here following the financial results briefings held every year
in February and August.

IR Information E-mail Delivery Service(RIMSNET)
This service sends an electronic newsletter announcing financial
results to registrants, who are primarily individual investors.

Register at:
https://rims.tr.mufg.jp/?sn=6481* The IR Information E-mail Delivery Service is managed by Mitsubishi UFJ
Trust and Banking Corporation.

2023 Activity Report
Annual plan

Details

ResultConvincing institutional investors of growthpotential in discussions focused on themedium to long term

Held IR and SR* consultations

Approximately 270 consultations held

Convincing stakeholders of medium- to longterm growth potential

Held General Meeting of Shareholders and financial results briefings

Resumed the product exhibition that accompanies the General
Meeting of Shareholders
Held two financial results briefings
Made videos available on the THK website

Completely renovated the THK website

Launched the Japanese website in March
Launched the Global English website in November

Published the Annual Securities
Report in English

Published in June

Published the Integrated Report

The Annual Report and Sustainability Report were combined, and Japanese and English editions were published in May and August, respectively.

Expanding information disclosures* SR: Short for “shareholder relations.” Activities aimed at establishing good relations with shareholders.

54

THK Integrated Report 202 4

Health and Safety
Policy• Prevent health hazards andpromote healthy practices

Goals• Create a safe and comfortableworking environment• Perform 100% of legally mandated health checks• Prevent new cases of extended leave caused byinjury and illness• Reduce rate of health findings• Zero workplace accidents

2023 Activities Report (Headquarters)
Annual plan
Convening the Health Committee
Workplace patrols (once a week by healthsupervisor and on even-numbered months
by industrial physician)
Performing work environment
measurements
Performing stress checks and responding
with countermeasures
Performing health checks and responding
with countermeasures
Administering influenza vaccines
Health education
Holding health promotion events
Preparing traffic safety measuresand holding a traffic safety event

Details

ResultCommittee members selected from each department perform audits,
give reports, and deliberate on health-related issues.

Meetings were held each month, a total of 12 times.

Performed in each workplace at the headquarters to check for healthand safety issues.

45 health supervisor patrols
6 industrial physician patrols (on even-numbered months)

Measured air quality in each workplace.

Performed during even-numbered months, a total of 6 times.

Conducted a simple new online survey of work-related stress.

The survey was conducted in August and had a 99.9% participation
rate.

Physician visited to perform internal health checks. Consulted with theindustrial physician and insurance staff about high-risk individuals andimplemented work restrictions for these individuals.
Offered an opportunity internally for employees to be vaccinated.
Posted advice from the industrial physician and a health office newsletteron bulletin boards.
Planned around a theme selected from the results of the health checks(including questionnaires).
Held a training conference for safe driving supervisors at THK Japan
and Group companies in Japan.

100% of employees received health checks.
Over three days in October, 61% of employees received vaccinations.
Posted each month company-wide, a total of 12 times.
A walking event was held using an app in December, in which 174
people participated.
The conference was held online in February for 46 participants.

Five THK Production Facilities (Yamagata, Kofu, Gifu, Mie, and Yamaguchi)
Policy1. We consider the improvement of occupational health and safety to be one of the most important issues for the Production
Division, and as we conduct our business activities at each factory, we promote the creation of a safe, healthy, and comfortable workplace by eliminating harmful work environments that may lead to injury or illness.
2. We continuously improve our health and safety management system by setting appropriate occupational health and safety
goals at each factory and reviewing them annually.
3. We strive to improve occupational health and safety by complying with laws such as the Industrial Safety and Health Act andrules relating to occupational health and safety established by the company and workplace.
4. Each facility eliminates hazards and causes of harm in the workplace through risk assessments and promotes activities withthe goal of completely eliminating all potential hazards.
5. Each facility promotes the occupational health and safety management system with the active participation and consultation of all employees.
6. We acknowledge that the occurrence of accidents and injuries is a direct reflection of the nature and culture of the workplace, and we promote activities to develop correct habits through the use of the occupational health and safety management system.
7. This occupational health and safety policy is disseminated to all employees at each plant through education, training, andawareness campaigns, and we facilitate the timely release of information relating to occupational health and safety within
and outside the Production Division.

2023 Activities Report
Annual plan

Details

1. Performing risk assessments
Prevent work-related injuries and illnesses• Zero labor accidents
2. Conducting workplace health and safety training• Achieve 3.1 million hours without
3. Implementing hazard prediction training and solicitany accidents (class 1 accident-free record)ing proposals to prevent near-miss events

Continuously improve occupational
health and safety performance

Provide a safe and healthy workplace

ResultConducted for each department at each production facility.
Conducted training at each production facility based on training rules.
Implementation rate: 87.5% for hazard prediction trainings and 97.7% for near-missevent prevention proposals
An outside specialist was invited every month to hold a special meeting to go over
4. C ommunicating and managing up-to-datechanges to laws and regulations. This information was then distributed to each proregulations (Performing chemical substance risk
duction facility. Chemical substance risk assessments are being performed according
assessments)
to the rules of each plant.
Committees convened monthly at each production facility, in accordance with Health
5. Promoting Health and Safety Committee activities
and Safety Committee rules.
6. Performing internal audits and management reviews Performed in accordance with relevant regulations.
7. Implementing traffic safety activities
Each production facility implemented activities on a voluntary basis.
Patrols were conducted according to each production facility’s implementation
8. Conducting workplace safety patrols
schedule.
9. Addressing mental health
Mental health was addressed following a directive from the headquarters.
10. R
 eceiving guidance from industrial physicians andPerformed at each production facility.
implementing disease prevention activities
11. Performing regular and special health checks
Performed at each production facility.
12. Managing long work hours (excessive overtime)
Performed at each production facility.

GovernanceHarmony with
the Environment

Involvement in Society

55

Data Section

ISO 45001 Initiatives
Having obtained ISO 45001 occupational safety and health man-plan. Our 2023 results included 12 labor accidents (4 that wereagement system certification, THK pursues the activities listed inlost-time accidents and 8 that were not), meaning that we could

the preceding table while following the PDCA cycle for the annual

not reach a new accident-free record.

Chemical and Hazardous Material HandlingIn the interest of strengthening our chemical handling structure inchemical risk assessment rules in accordance with the amended

keeping with partial amendments to the Ordinance on Industrial

laws and regulations. This has resulted in even stronger chemi-

Safety and Health and other regulations, THK conducted a re-cal handling management at each production facility than existed

view of its chemical handling rules and an overall review of its

previously.

Responding to Community Complaints (Noise, Etc.)
Mie Plant• In early November, we received complaints from members of• Heat Treating Factory 3 received a community complaint about

the surrounding community that lights were shining into their

the noise generated by running its equipment. The plant isentryways, living rooms, and other areas of their homes atmoving forward with installing soundproof walls.

night. In response, the plant switched 70% of its lights to energy-saving mode and set them to shut off at 8:00 p.m.

Responding to Employee Needs (Providing Protective Equipment and Ensuring Safety of Machines and Equipment)
We provide all protective equipment required for production

cut-resistant gloves). Furthermore, safety fences are put in place

operations (such as safety glasses, ear plugs, dust masks, andto ensure safety where automated equipment has been installed.

Other Initiatives
Gifu Plant

2022 Workplace Excellence Encouragement Award from the Ya-

The plant participated in the 2023

manashi Labor Bureau and gave a presentation on risk-aware

Seino STOP! Falling Accidents Project

occupational health and safety initiatives to share examples ofand received an award from the Ogaki

that workplace excellence.

Labor Standards Inspection Office inDecember for being a company thattook proactive measures to prevent

Data
Incident and Severity Rates

falling accidents and avoided labor ac-

2021

2022

2023

cidents that would have resulted in four

Incident rate

1.43

0.88

1.49

or more days of lost time.

Severity rate

0.02

0.02

0.00

Kofu Plant
The 2023 Yamanashi Pre-

Applicable Locations:fecture Industrial Safety and• Five THK production facilities (Yamagata, Kofu, Gifu, Mie, andHealth Conference was held

Yamaguchi)in October at the Yamanashi• Group company production facilities (THK NIIGATA; THKPrefectural Museum of Lit-

INTECHS Sendai and Mishima; THK RHYTHM Hamamatsu,

erature. During the event,Inasa, and Kyushu; and NIPPON SLIDE)

the Kofu plant received the56

THK Integrated Report 202 4

Human Rights
The THK Group conducts activities to promote respect for human rights company-wide in accordance with the THK Group Human Rights
Policy. Through these activities, we will continue to carry out our responsibility to uphold human rights as one of the areas of the UN Global
Compact, to which THK became a signatory in 2020.

THK Group Human Rights Policy
The THK Group respects the human rights of all people associated with the THK Group based on its corporate philosophy of “Providing
innovative products to the world and generating new trends to contribute to the creation of an affluent society,” which represents the pioneering spirit of the THK Group.

Basic Concept
The THK Group supports and respects the United Nations Guiding Principles on Business and Human Rights and other international standards regarding human rights. In addition, as a signatory company to the United Nations Global Compact, the THK Group acts in accordance with the Ten Principles of the United Nations Global Compact concerning human rights, labor, the environment, and anti-corruption.
This Policy functions as the dominant policy for the “THK Group Action Charter” and all other standards that relate to initiatives encouraging respect for human rights within the THK Group. Furthermore, this Policy is an indication of the THK Group’s commitment to respect for human rights.

Scope of Application
This Policy applies to all officers and employees of the THK Group. In addition to this Policy, all officers and employees of the THK Group
comply with the standards encouraging respect for human rights in their respective companies.
The THK Group also expects all business partners associated with the THK Group’s business activities to support and comply with this Policy.

Conduct Guidelines
1. The THK Group complies with all laws and regulations, and engages in fair trade and business activities with a high sense of ethics.
2. The THK Group respects the basic human rights, individuality, and diversity of individuals, and does not discriminate, harass, orotherwise treat individuals inhumanely based on race, gender, language, religion, nationality, sexual orientation, gender identity, or
disability.
3. The THK Group does not engage in any forced or child labor.
4. The THK Group will comply with labor agreements and respect freedom of association and the right to collective bargaining.
5. The THK Group will create a working environment where employees can work safely and with peace of mind, in a manner that is
healthy both mentally and physically.
6. The THK Group will provide appropriate education to all officers and employees, and strive to create a vibrant corporate culture inwhich all people respect each other for their diverse individual characteristics.
7. The THK Group makes efforts to build a system that allows officers and employees to raise concerns about human rights violations ingood faith at any time, and to recognize any negative impacts on human rights by performing due diligence.
8. In the event that a violation of human rights becomes evident, the THK Group will immediately take appropriate action, including steps
to prevent a recurrence, and adopt effective remedial measures.
9. The THK Group will make this Policy known to all officers and employees and disclose this Policy to the public in an appropriatemanner.

Structure
Committees
THK has established a Compliance Committee that is chaired by
the president, and this group works together with its subordinate

Organization Structure
Compliance Committee
Chair: President

compliance subcommittees as well as human rights personnel
that have been selected at each Group company worldwide inorder to foster smooth communication.

THK Group Helpline
The THK Group provides a helpline for employees to consult
about or report matters concerning wrongful acts, legal violations, and unethical behavior, especially issues related to humanrights. A separate, dedicated point of contact is also available forincidents of harassment.

Observers

Committee Secretariat

Outside directors and legal
advisorRisk Management
Department

Human Rights Personnel

Compliance Subcommittees

Members selected from eachGroup company (worldwide)

Members selected from each office,department, and Group company inJapanGovernanceHarmony with
the Environment

Involvement in Society

Data Section

57

2023 Activities Report
Annual plan

Details

ResultHarassment prevention training

An overview of workplace harassment
and countermeasures

Training was gradually implemented for a total of 292 employees at the headquarters and the Technology Centerstarting in February.

Released 2022 Statement on the UK
Modern Slavery Act

Response to the UK Modern SlaveryAct

The 2022 human rights activities report was released in
the form of a statement based on the UK Modern Slavery
Act.

Seminars on compliance andharassment

Covered topics such as compliance,
sexual harassment, and power harassment

Starting in September, seminars on compliance andharassment were held for a total of 1,022 employees at
production facilities (including some Group company employees).

Harassment seminar for directors andexecutive officers

1. Harassment prevention initiatives
2. Harassment training

Director Junko Kai taught the seminar for a total of 26 directors and executive officers in September.

Compliance Subcommittee seminarCommunication methods for preventing harassment

An outside lecturer was invited to hold a seminar for 46
Compliance Subcommittee members in October.

Performing due diligence concerning
human rights within the THK Group

Confirmed the status of activities
related to respecting human rights ateach THK Group company

Responses were received from 23 THK Group companies
between the months of November and December. The results are included in the 2023 Statement on the UK Modern Slavery Act.

Human Rights Efforts
Training

Raising Awareness

Using a variety of methods, including a web conference system,

By distributing the THK Group Supplier CSR Procurement

in-person training conducted by internal or external instructors,

Guidelines, the THK Group has requested cooperation from eache-learning materials, the company intranet, and internal informa-

supplier with regard to our human rights efforts.

tion boards, the THK Group regularly disseminates valuable infor-

However, the survey results from 2023 revealed that there aremation and conducts training about human rights topics.

some gaps in awareness.

Anti-corruption

increase knowledge of our guidelines among our critical suppli-

The THK Group works to prevent bribery as one part of our an-ers.

ti-corruption efforts.

In cooperation with each Group company, we will thoroughly

Furthermore, for primary suppliers of THK Japan, we will

Each Group company handles such matters in accordancecontinue to investigate matters related to the Xinjiang Uyghurwith the THK Group Anti-bribery Policy. In addition to sharing in-Autonomous Region in addition to requiring cooperation with ourformation with human rights personnel, we will endeavor to pro-human rights efforts.

mote greater awareness and understanding of our basic policy
among all THK Group employees in 2024.
We will engage in coordinated efforts to prevent corruption
throughout the entire THK Group.

A summary of the above activities is available in the form of the2023 Statement on the UK Modern Slavery Act, which is postedon the THK website.

58

THK Integrated Report 202 4

Human Capital
Strategy
THK has grown as a company focused on creation and develop-

set “Realization of a diverse and meaningful work environment”

ment that develops original products using our unique technol-

as one of our material themes as we have carried out initiatives

ogies. We believe this growth is attributable to each and every

for talent development, promoting diversity, occupational healthemployee that strives to embody our management philosophy.

and safety, and respecting human rights.

As indicated by how we refer to our human resources as “hu-We will continue our efforts to achieve our growth strategies of

man assets,” we consider our employees invaluable assets thatfull-scale globalization, the development of new business areas,

enable the Company to achieve sustainable growth and create

and a change in business style and to realize our management

value.

philosophy beyond that. As we engage with material issues, we

Based on the view above, we aim to create an environment inwill also promote human capital management initiatives from thewhich our employees respect each other’s strengths and individ-

perspectives of succession planning, recruitment, mental health,uality and can work safely and with enthusiasm. To this end, we

physical health, and childcare leave.** Selected from the 19 recommended disclosure items listed in the Cabinet Secretariat’s
Guidelines for Human Capital Visualization based on importance.

Development Policy
1. Developing Global TalentWith the aim of improving the language skills of our in-house talent in Japan, we provide support for learning English through conversation, including the introduction of speaking tests and e-learning courses. In addition, in order to quickly develop global talent, we haveintroduced an international trainee system in which young employees mainly in their late twenties are dispatched to Group companies
outside of Japan for about one year.

2. Developing Digital Talent
By utilizing the latest technologies, we aim to transform business processes and systems, thereby increasing customer satisfaction,
improving the efficiency of internal operations, and ultimately realizing a recycling-oriented society and solving future social issues suchas labor shortages. To achieve this, we are focusing on DX activities so that we can provide value through innovation.
As part of the above efforts, we conduct data utilization training for all employees with the goal of having each location be able to utilize
data in a unique and autonomous way. We are working toward having every employee take the basic and beginner courses, and this goalis over 90% complete. Going forward, we will expand the intermediate and advanced courses throughout more of the company in orderto achieve more advanced data utilization (by using tools such as image recognition and demand forecasts based on machine learning).
We also hold internal competitions to encourage employees to make voluntary efforts related to data science by presenting theirresearch results and engaging in friendly competition.

3. Expansion of Training Initiatives for all Employees
We also plan to enhance training initiatives for all employees. Specifically, in addition to enhancing technical training and e-learning content, we are working to improve the skills of all employees, such as by holding forums aimed at improving skills and sharing knowledge.
Furthermore, in order to promote the growth and career development of our employees, who are the source of our strengths as acompany focused on creation and development, we have introduced a system in which we compensate employees based on the expertise they possess. Going forward, we plan to consider further expansion of the expertise employees can receive compensation for.

4. Development of Successors and Next-Generation TalentWith a view to the medium- to long-term development of the company, we select key positions that require planned succession, holdreview meetings to discuss the development status of candidates, and conduct management training and aptitude assessments toensure the smooth succession of management talent. In addition, with the aim of developing candidates over the medium to long term,
we will consider expanding the program to include younger talent.

Governance

Involvement in Society

Harmony with
the Environment

Data Section

59

5. Promoting Diversity
In order to create corporate value over the medium to long term, we believe an environment in which diverse values can be accepted
and utilized is key, as is the promotion of diversity. As the first step toward this, we aim to promote the advancement of women.
As specific initiatives, we are considering implementing career training for women, roundtable discussions involving employees
raising children, and unconscious bias training for managers.

6. Strengthening the Hiring of International Talent
We are carrying out a project in which we accept international talent with backgrounds in science as interns and have them present
solutions that utilize our technology. We also actively participate in job fairs at universities outside of Japan.
Through the above initiatives, we have already accepted students from several Asian countries, with some joining the Company as
employees.

Internal Environment Development Policy
1. Improving Occupational Health and Safety
We believe that occupational health and safety is the foundation of corporate management, and as such, consider the creation of asafe, healthy, and comfortable workplace to be one of the most important issues for the Production Division. Accordingly, we work toeliminate harmful work environments that may lead to injury or illness.
* See Health and Safety on p. 54 and 55 for details.

2. Promoting Health and Productivity Management
We pursue physical and mental health initiatives with the goal of creating a foundation for talent development in the form of a workplacethat promotes employee health and enthusiasm. Moreover, as part of our efforts to improve work-life balance, we are carrying out measures to support employees balancing work with childcare or nursing care.

Main Activities
Activity

Description

Mental health measures· Conducted stress checks of all employees

Receiving guidance from industrial physicians andimplementing disease prevention activities· Had an industrial physician inspect the workplace and provide guidance at the health andsafety committee meeting

Performing regular and special health checks· Conducted regular health checks in addition to special health checks for specific individuals at each production facility

Managing long work hours (excessive overtime)· Managed overtime at each production facility and monitored it at the headquarters

Providing support for balancing work with childcare or nursing care

· Formulated a handbook on support for balancing work with childcare or nursing care

Metrics and Targets
We have established the following metrics and targets for our talent development and workplace development policies.
MetricResult (2023)

Target (2026)

Percentage of women hired among new graduatesin sales, administration, and engineering divisions

23.2%

20.0% or more (as of March 31, 2025)

Rate of male employees taking childcare leave

66%

50% or more

Rate of employees returning to work after taking
childcare leave

100%

100%

Severity rate

0.00

0.01 or lower

Incident rate

1.22

0.50 or lower* Scope covers THK Japan.

60

THK Integrated Report 202 4

Environmental Management
Environmental Policy
The THK Group contributes to both society and the economy

state for the next generation, which is why we are promoting thethrough our pioneering role as manufacturers of the Linear Motion

following initiatives to continually decrease our environmental im-

Guide and other products. We also believe that it is a company’s

pact and to sustain and improve the natural environment.

social responsibility to leave the global environment in a healthy

THK Group’s Basic Environmental Policy
1. We consider conservation of the environment to be a major

5. With a particular focus on the reduction and recycling of waste,management challenge, and we are striving to accurately un-

we will not only continue to promote the saving and recycling

derstand how our business activities, products, and services
impact the environment. All divisions set appropriate environmental goals to address this challenge.
2. In addition to complying with environmental laws, we have setof resources, but also strive to prevent pollution.
6. We recognize the impact our business activities have on biodiversity, and we will actively work toward the conservation of
all life on Earth.

self-imposed standards that are reviewed regularly to improve

7. To achieve greater collaboration with regard to our environ-the efficiency and effectiveness of our environmental manage-

mental activities, we provide guidance and support to our affil-

ment.

iate companies and business partners, and also strive to work

3. We will continually promote the development of products that
help reduce environmental impact.

in cooperation and harmony with the community.
8. This basic environmental policy is disseminated to all divisions

4. We will cut down energy use in our business activities andin the group through education, training, and awareness cam-continually promote the reduction of energy consumption andpaigns, and we facilitate the timely release of information on

greenhouse gas emissions.

the environment both within and outside the Group.
Revised on August 21, 2019

Structure for the Promotion of Environmental Activities
For THK Japan and Group companies in Japan, we have devel-

Structure for the Promotion of Environmental Activities

oped a structure that promotes various initiatives aimed at reducing the environmental impact of our business activities.
The Environmental Committee, chaired by the President, con-Environmental Committee
Meeting: 4 times/year
Chair: President

venes quarterly and approves each year’s environmental targets

Secretariat

and environmental promotion schedule. In addition to reporting

Environmental Management
Section, Environmental
Management Promotion Unit,
Risk Management Department

on the state of energy conservation activities, the managementof hazardous materials, and the status of compliance with various other environmental laws and regulations, it also considers
necessary improvements as appropriate.
The General Meeting for Environmental Measures convenes
twice a year, headed by the Vice President. Representatives fromeach production facility and office department gather to recognize
the necessity of proactive efforts toward reducing environmental
impact. They share useful data, such as the status of energy use atGeneral Meeting forEnvironmental Measures(Japan only): 2 times/year
Chair: Vice President

Sales Division
Production Divisioneach facility and examples of the results of energy-saving projects,
and connect this information to improvement initiatives.

Support Division

Specifically, they report on activities to reduce environmental
impact that are suitable to each business location, such as thediscovery and elimination of wasteful uses of energy, the transition to energy-efficient production equipment and HVAC systems, the installation of solar panels in open spaces, the conversion of lighting to LED bulbs, and so on.

Group Companies’
Production Divisions

Governance

Involvement in Society

Harmony with
the Environment

Data Section

61

TCFD
TCFD Strategy
In an effort to combat climate change as a material issue con-2050 based on the 1.5°C and 4°C climate change scenarios

nected to decarbonization and the realization of a recycling-ori-

proposed by the IEA (International Energy Agency) and IPCC

ented society, the THK Group performs an impact analysis in(International Panel on Climate Change). Details about the oth-accordance with TCFD recommendations. As part of our strat-

er three core elements of the TCFD recommendations—gov-

egy, one of the four core elements of these recommendations,

ernance, risk management, and metrics and targets—can be

we have been analyzing scenarios primarily with regard to our

found under “Material Issues and KPIs” (p. 20), “Principal Risks

Japanese industrial machinery and automotive and transporta-

and THK’S Response” (p. 36), and “Working toward Carbon

tion businesses in consideration of our long-term impact up to

Neutrality” (p. 62), respectively.

Primary Climate Change Risks/Opportunities and Responses
Scenario

Cause

ChangeIncreased procurement
costs

Risk/
Opportunity

Risk

Level

Impact on THK

Major

The introduction of carbon taxes
will cause raw material priceincreases to be passed on to
THK, and procurement costs
will rise.

Introduction of carbon taxes

Change to renewable energy

Increased need for energy
savings

Expansion of environmental
business

Risk

Major

Increased energy procurement costs

Risk

Minor

The change to renewable energy
will increase energy procurement
costs.

• Procure renewable energy
internally by installing solar power
generation systems

Major

There will be more equipment
designs, fabrications, modifications, and product demand
for automation and efficiency
improvements for the purpose ofboosting energy efficiency.

• Strengthen provision of THK
products that contribute to energy savings (LM Guide, electric
actuators, unit products, etc.)

Major

Business opportunities will
increase for the manufacture ofsemiconductor manufacturing
equipment components, particularly involving power semiconductors, which form the core ofenergy savings.

• Establish a development,
production, and sales structurethat can respond promptly andflexibly

Minor

Demand will increase for a failure
diagnosis/predictive failure
detection service that utilizes the
IoT and helps boost productivity
and reduces energy loss.

• Expand IoT services that boost
productivity and strengthen sales
activities and solutions that utilize
such services

Major

As more vehicles become
electric, new types of products
become required, and demand
for THK products will increase.

Increased business opportunities in semiconductors

Increased demand for electric vehicle components

Increased ESG investment

Supply chain interruptions

4°C• Switch to raw materials with low
carbon taxes

Increased operating costs

Increased demand for failure
diagnosis/predictive failure
detection service

Advancement of electricvehicles• Reduce raw material input

The introduction of carbon
taxes will cause carbon tax
payments to increase based onJapanese Scope 1 and Scope 2
emissions.

Increased demand forenvironmentally friendly
technology solutions

1.5°C

THK’s Response

Opportunity

Opportunity

Opportunity

Opportunity

Opportunity

Risk

Minor

Minor

Supply of raw materials will beinterrupted if the supplier suffers
a disaster.

Minor

Rising temperatures will cause
air conditioning costs to increase
for factories, distribution centers,
and offices.

Serious damage from weather-related disasters
Increased costs from global
warming

Risk

Expanding THK’s business inenvironmental fields will capture
the attention of investors andmake them evaluate THK morefavorably, and ESG investment
will increase.

• Develop energy-saving production technology• Transition to low-carbon,
non-fossil fuel energy• Establish a development,
production, and sales structurethat can respond promptly andflexibly• Plan new business• Establish a development,
production, and sales structurethat can respond promptly andflexibly• Actively disclose information andstrengthen communication withstakeholders• Decentralize raw material
suppliers• Secure alternative suppliers• Improve heat insulation performance of buildings

62

THK Integrated Report 202 4

Working toward Carbon Neutrality
As exemplified by sustainability, society and corporations gener-

Meanwhile, to strengthen our positive impact, we are expanding

ate common value through corporate activities that minimize theour offerings of linear motion and other products and services

negative impacts and strengthen the positive. With this mindset

that contribute to energy conservation. We will accelerate ourof working for the benefit of all in addition to our individual inter-various initiatives in order to achieve these goals.

ests, THK is promoting various initiatives to achieve the creationof a sustainable society. In response to risks posed to the world

Medium-Term Target

by climate change from global warming in particular, we estab-• By 2030, reduce CO2 emissions to 50% of 2018 levels.

lished medium- and long-term targets for lowering our emissions• Scope: THK Japan and Group companies in Japanof greenhouse gases in August 2021.
First, to minimize our negative impact, we have establishedLong-Term Target

the Carbon Neutrality Promotion Project, which is working to• By 2050, achieve net-zero CO2 emissions.

further reduce the CO2 emitted through our business activities.

• Scope: Entire THK Group

Reflecting on the 2023 Fiscal Year
In 2023, we promoted activities to achieve carbon neutrality

a total of 10 facilities making use of renewable energy. These fa-

centered on the production facilities of THK Japan and Groupcilities generate a total of 10,875 MWh, an increase of 159% overcompanies in and outside of Japan. As a result, THK Japan and2022 (see the renewable energy section of the environmental im-

Group companies in Japan saw CO2 emissions drop to 85,103

pact overview on the next page). In addition, THK actively pursued

tons, which was a 20% reduction from the baseline year of 2018

the installation of new high-efficiency production machines andand a 17% reduction compared to 2022.

other equipment as well as the transition to LED lighting. Please

One example of the activities that yielded this result is the instal-see our homepage for details about our activities at each facility.

lation of new solar power generation equipment at four production

The results of each facility’s environmental activities are sharedfacilities (the Yamagata plant, THK NIIGATA, THK Liaoning, andthrough various committees, and THK is building a structure for ex-

THK RHYTHM Thailand). As of the end of December, there were

panding the implementation of effective methods to other locations.

CO2 Emissions

Solar Power Generated（t-CO2）120,000

106,514100,000（MWh）
12,000102,558

80,0008,000

85,10360,0006,000

40,0004,000

20,000

2,000

0

2018

2022

10,875

10,000

2023

Year

0

2,826

2021

4,206

2023

2022

Year

Main Environmental Committees
Annual plan

Details

ResultEnvironmental Committee

Decides on the THK Group’s environmental goals, policies, and promotion plans and reports on the implementation status of said plans.

Convened four times during the year (inFebruary, May, August, and November)

General Meeting for Environmental Measures

Reports on the environmental initiatives of THK Japan (administrative departments and production facilities) and related Group production facilities.

Convened twice during the year (in February and September)

Carbon Neutrality Promotion Project Meeting

Reports on the carbon neutrality initiatives of THK Japan’s production facilities and THK NIIGATA.

Convened four times during the year (inJanuary, May, July, and November)

Governance

Involvement in Society

Harmony with
the Environment

Data Section

63

Environmental Impact Overview
THK Group Business Activity Environmental Impact Overview1
INPUT(Data collection period: January to December 2023)

OUTPUT

Material Procurement
Production Materials Used
Main raw materials (t)Main indirect materials (t)Packaging materials (t)2022
123,335
1,869
8,542

2023
78,5901,597
6,163

Change
-36%
-15%
-28%

2022
2,662
226
1,752
14
327,631
626
58
—
—

2023
2,427
220
1,501
12
275,105
630
55——

Change
-9%
-3%
-14%
-13%
-16%
+1%
-5%
—
—

Production
Energy Consumption
Bunker A fuel oil (kL)
Liquefied natural gas (t)Propane (t)Kerosene (kL)Electricity (MWh)Surface water
Water
Groundwater
intakeSea water(1,000 m3)
Industrial water

Production Volume

Renewable Energy

2

Solar power generated (MWh)

2022
4,206

2023
10,875

Change+159%

Production volume (t)2022
91,1742023
70,050Change-23%

2022
24,281
20,946
2,675

2023
21,862
18,8882,210

Change
-10%
-10%
-17%

2022

2023

ChangeWaste
Total waste (t)Recycled (t)Disposed (t)Air Emissions
PRTR substances3 (kg)CO2 emissions (t-CO2)

971

980

+1%

195,299

172,013

-12%

2022
329
—
—

2023
325
—
—

Change
-1%
—
—

2022
4,395

2023
3,363

Change-23%

Water Discharge
Surface water
Water
discharge Groundwater(1,000 m3) Sea water

Logistics4
Fuel for Vehicles
Gasoline (kL)
Diesel (kL)

Air Emissions
2022
125
1,586

2023
84
1,225

Change-33%-23%

Main Management Items3
2022
TargetResult0.532
0.559
Energy intensity5
Less thanZero emissions
0.14
0.50
PRTR substances (kg) 49,268
35,4722023
TargetResult0.705
0.690
Less than
0.12
0.50
—
38,816CO2 emissions (t-CO2)

This data was taken from the following facilities:
1
Environmental Impact Overview:
Twelve THK Japan production facilities: Yamagata, Kofu, Gifu, Mie, Yamaguchi,
THK NIIGATA, THK INTECHS (Sendai and Mishima), NIPPON SLIDE, and THK
RHYTHM (Hamamatsu, Inasa, and Kyushu)
Eight production facilities outside of Japan: TMA (USA), TME (France), TMI(Ireland), DALIAN THK (China), THK Wuxi (China), THK Liaoning (China), THK
Changzhou (China), and TMV (Vietnam)
2
Ten facilities: Toyota branch, Yamaguchi plant, Yamagata plant, THK INTECHS
Mishima plant, THK RHYTHM Hamamatsu plant, THK RHYTHM Kyushu plant,
THK NIIGATA plant, THK Liaoning, THK Changzhou, and THK RHYTHM Thailandplant
3
Twelve THK Japan production facilities
4
Five THK Japan production facilities (Yamagata, Kofu, Gifu, Mie, and Yamaguchi);two distribution centers (Chubu and Yamaguchi); and three factory centers (Yamagata, Kofu, and Mie)
5
Energy intensity: Energy consumption/Value added

64

THK Integrated Report 202 4

Zero Emissions and Hazardous Material Management Activities
Achieving and Maintaining Zero Emissions
With our zero emissions activities, we aim to reduce all forms of

THK Japan aims for an annual emissions rate (volume of waste

waste we generate to zero by doing things like reusing it wherev-

disposed/total discharged) of less than 0.50%. Continuing fromer possible. We promote zero emissions activities through con-the successful achievement of this goal in 2022, we met this goal

trolling the use of direct and indirect materials, emissions andagain in 2023 with a rate of 0.12%.

final waste, and reusing and recycling.
The waste produced by our business activities includes met-

Waste Recycling Methods

al scrap, oil and liquid waste, grinding sludge, packaging, andWaste
Grinding sludge
Metal scrap
Grinding wheels
Cardboardplastic waste. By thoroughly separating our waste, we reuse ortransform waste into usable materials, such as by turning steel
scrap into steel-making material, sludge with grinding wheel dust
into cement material, and oil and plastic waste into fuel.

Material recycling1
Metal, subbase, cement
Subbase, grinding wheels
Paper, cardboard, fiberboard
Glass
Plastic
Water resources

Reducing plastic waste has garnered particular attention in reWaste
Plastic
Waste oil
Used paper,
cloth, wood chips

cent years. THK is making steady strides in reducing the amountof plastic waste we generate by reusing and recycling plastics
used in our production process as well as reducing plastics
used by employees in our cafeterias (by transitioning to wooden
spoons, for example).

1
2

Thermal recycling2

Combustion aid,
regenerated fuelMaterial recycling: Reusing waste as raw material for another product
Thermal recycling: Using waste as combustion material

Hazardous Material Management Activities
Environmentally hazardous materials are defined as materials

Green Procurement Guidelines at our production facilities in andthat may be harmful to the human body or ecosystems whenoutside of Japan and provide information necessary to meeting

contained in a product. In principle, we prohibit the use of suchour customers’ requirements. In addition, we submit reports tomaterials in our components and raw materials. For hazardous

the relevant authorities as required by the REACH Regulation.

substances that may be present as impurities, we have established tolerances and handle such materials accordingly.

We stringently manage chemicals specified in the PRTR Law4
and are working to switch to products that do not contain such

With regard to the Restriction of Hazardous Substances

substances. As a result of the law’s amendment, which greatly

Directive (RoHS),1 the REACH Regulation2 in the EU, and thechanged the range of specified substances, the amount we used

Administrative Measure on the Control of Pollution Caused byin 2023 came to 38,816 kg.

Electronic Information Products in China, we have adopted our
31

RoHS Directive: Directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment

2

3

REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals) Reg-

Substance

Amount (kg)

Air Emissions (kg)ulation: A regulation that requires almost all chemicals sold in the EU to be evaluat-

Xylene929

208

ed for safety and to be registered

Toluene

1,869

493

Administrative Measure on the Control of Pollution Caused by Electronic Infor-

Ethylbenzene

158

56

mation Products: A law, also called “China RoHS,” that requires disclosure when

4

PRTR Substance Amount and Air Emissions

95

31

25,99044

certain hazardous substances are present in electronic information products andBenzenecomponents

Methylnapthalene

PRTR Law: The Act on Confirmation, etc. of Release Amounts of Specific Chemical

Other

9,774

149

Total

38,816980

Substances in the Environment and Promotion of Improvements to the Management Thereof

Data includes 12 production facilities in Japan: Yamagata, Kofu, Gifu, Mie, Yamaguchi, THK NIIGATA, THK INTECHS (Sendai and Mishima), NIPPON SLIDE, and THK
RHYTHM (Hamamatsu, Inasa, and Kyushu).

Governance

Involvement in Society

Harmony with
the Environment

65

Data Section

External Certifications
Third-Party Certification (ISO 14064)
We have received third-party verification that our Scope 11 andNo. 1811004729

Scope 22 GHG emissions calculations during the 2023 fiscal year

Greenhouse Gas Emissions
Verification Report(January 1 to December 31, 2023) are in accordance with the
ISO 14064-3 calculation rules stipulated by the Japan Quality
Assurance Organization (at a limited level of assurance for the

1. Objective and Scope
Japan Quality Assurance Organization (hereafter “JQA”) was engaged by THK CO., LTD. (hereafter “the Company”) to provide
an independent verification on “FY2023* GHG Emissions Calculation Report” (hereafter “the Report”). The content of ourverification was to express our conclusion, based on our verification procedures, on whether the statement of information regarding
the FY2023 GHG emissions in the Report was correctly measured and calculated, in accordance with the “TSS-G00-00001: GHG
Emissions Calculation Rules (Scope 1, 2) ver.4” established by the Company, and the “TS-GHG-00001：GHG Emissions
Calculation Rules (Scope 1, 2) ver.1” established by THK NIIGATA CO., LTD. (hereafter “the Rules”). The purpose of theverification is to evaluate the Report objectively and to enhance the credibility of the Report.
*The fiscal year 2023 of the Company ended on December 31, 2023.

ISO 14064-3 verification standard).

2023 THK CO., LTD. GHG Emissions
Calculation Report
Scope: Six factories (Yamaguchi, Yamagata, Kofu,
Mie, Gifu, and THK NIIGATA)
Target items: CO2 created by Scope 1 and 2 energy consumption
Scope 1

7,816 t-CO2

Scope 260,423 t-CO2

Total

68,239 t-CO2

To: THK CO., LTD.

2. Procedures Performed
JQA conducted verification in accordance with “ISO 14064-3”. The scope of this verification assignment covers energy-derived
CO2 emissions from Scope 1 and 2. The verification was conducted to a limited level of assurance, and quantitative materiality
was set at 5 percent of the total emissions in the Report. The organizational boundaries of this verification are THK Group’s 6
domestic production sites in Japan.
Our verification procedures included:•
Performing validation of integrated functions to check the Rules prior to the Site Visit.
•
Holding on-site verification at the Company's two sites: Kofu Plant and Mie Plant.
The sampling sites for on-site assessment were selected by the Company.
•
On-site assessment to check the Report boundaries, GHG sources, monitoring points, monitoring and calculation
system and its controls.
•
Vouching: Cross-checking the GHG emissions data against evidence.
3. Conclusion
Based on the procedures described above, nothing has come to attention that caused us to believe that the information regarding
the Company’s FY2023 GHG emissions in the Report is not materially correct, or has not been prepared in accordance with theRules.
4. Consideration
The Company was responsible for preparing the Report, and JQA’s responsibility was to conduct verification of GHG emissions
in the Report only. There is no conflict of interest between the Company and JQA.

Scope 1: Direct greenhouse gas emissions that a businessgenerates itself
2
Scope 2: Indirect emissions that accompany the use of electricity, heat, or steam supplied by other companies
1

Sumio Asada, Board Director
For and on behalf of Japan Quality Assurance Organization
1-25, Kandasudacho, Chiyoda-ku, Tokyo, Japan
March 25, 2024
*Please refer to the annex in the next page.

1 / 2Greenhouse Gas Emissions Verification Report

ISO 14001 Certified Facilities
Japan

EuropeProduction Facility

Country

Yamagata Plant, Kofu Plant, Gifu Plant, Mie Plant,
Yamaguchi Plant, THK NIIGATA
THK RHYTHM Headquarters, Hamamatsu Plant, Inasa
Plant, Kyushu Plant

Certifying
Body
JQA

Japan

THK INTECHS Headquarters, Mishima Plant, Sendai
Plant

THK RHYTHM AUTOMOTIVE CANADA(St. Catharines)

FranceAFAQ

THK RHYTHM AUTOMOTIVE GmbHGermany

DQS

THK RHYTHM AUTOMOTIVE CZECH

Czech
Republic

DQS

Country

Certifying
Body

Asia
CountryUSA

THK RHYTHM AUTOMOTIVE MICHIGANTHK RHYTHM AUTOMOTIVE CANADA(Tillsonburg)

THK Manufacturing of Europe

ClassNK

THK Manufacturing of America
THK RHYTHM NORTH AMERICA

Certifying
Body

JIA

The Americas
Production Facility

Country

Production Facility

Certifying
Body
SAI
GLOBAL
SQA

Production Facility
THK MANUFACTURING OF CHINA (WUXI)DALIAN THK, THK MANUFACTURING OF CHINA(LIAONING)DQS

THK RHYTHM CHANGZHOUDQSTHK RHYTHM GUANGZHOUCanada
DQS

TÜV
TÜV
China

BUREAU
VERITASSGSTHK RHYTHM MALAYSIA

Malaysia

DQS

THK RHYTHM (THAILAND)

ThailandURS66

THK Integrated Report 202 4

Financial and Non-Financial Highlights(Millions of yen)

3/20133/20143/20153/20163/2017

Revenue1

168,366

185,466

217,678

240,478

273,577Japan

101,443

101,052

113,361

110,498

112,061

The Americas

22,52728,90034,85650,34363,025

Europe15,194

18,427

20,45630,42446,004

China

13,203

19,351

28,302

27,96729,513

Asia and Other

15,996

17,73420,70021,243

22,971Gross Profit

44,29852,90367,02467,76670,464

Operating Profit (Loss)

11,692

17,37028,38823,16924,653

Profit (Loss) before Income Taxes

14,73724,00433,501

19,612

23,057

Profit (Loss) Attributable to Owners of the Parent

9,808

15,59022,705

13,575

16,731

Total Assets

293,145

336,416

373,610

407,808

414,931

Total Equity

189,058

222,148

250,498

250,540

251,540

Profit (Loss) —Basic

76.96

123.16179.36107.24132.18

Profit (Loss) —Diluted

—

—

—

—

—

1,479.41

1,736.51

1,957.48

1,953.97

1,966.80

18

26

50

50

41

Ratio of Revenue from Outside of Japan (%)

39.7

45.5

47.9

54.1

59.0

Operating Margin (%)

6.9

9.4

13.0

9.6

9.0

Per Share (yen)Equity Attributable to Owners of the Parent
Cash Dividend

Ratio of Profit to Equity Attributable to Owners of the
Parent (ROE) (%)

5.4

7.7

9.7

5.5

6.7

Return on Assets (ROA) (%)2

4.2

5.7

8.2

6.1

6.1

Equity Ratio Attributable to Owners of the Parent (%)

63.9

65.3

66.3

60.7

60.0

Asset Turnover Ratio (Times)

0.58

0.59

0.61

0.62

0.67

Revenue

Profit (Loss) Attributable to Owners of
the Parent/Return on Revenue(¥1 million)
400,000
300,000
200,000(¥1 million)
40,000

(%)
20.0

(¥)
100

(%)
50.0

30,000

15.0

80

40.0

20,000

10.0

60

30.0

10,000

5.0

40

20.0

0

0

20

10.0

(5.0)

0

100,000

0

12/19

12/20

12/21

12/22

(10,000)

12/23■ Japan ■ The Americas ■ Europe ■ China ■ Asia and Other

Operating Profit (Loss)/
Operating Margin(¥1 million)

60,000(%)
18.0

40,000

12.0

Cash Dividends per Share/
Payout Ratio

12/19

12/20

12/21

12/22

12/23

12/19

12/20

12/21

12/22

0

12/23

■ Profit (Loss) Attributable to Owners of the Parent (Left Scale)● Return on Revenue (Right Scale)■ Cash Dividends per Share (Left Scale)● Payout Ratio (Right Scale)

Return on Assets (ROA)/
Ratio of Profit to Equity Attributable to Ownersof the Parent (ROE)

Equity Attributable to Owners of the Parent/
Ratio of Equity Attributable to Owners of the
Parent(%)
16.0(¥1 million)

400,000(%)
80.0

300,000

60.0

200,000

40.0

100,000

20.0

12.0
8.0

20,0006.0

00(20,000)

12/19

12/20

12/21

■ Operating Profit (Loss) (Left Scale)● Operating Margin (Right Scale)

12/22

12/23

(6.0)

4.0
0
(4.0)

12/19

12/20

12/21

12/22

12/23

● Return on Assets (ROA)● Ratio of Profit to Equity Attributable to Owners of the Parent (ROE)

0

12/19

12/20

12/21

12/22

12/23

0

■ Equity Attributable to Owners of the Parent (Left Scale)● Ratio of Equity Attributable to Owners of the Parent (Right Scale)GovernanceHarmony with
the Environment

Involvement in Society

67

Data Section

In an effort to better facilitate the global comparison of financial information in the capital market and to strengthen its global financial management bystandardizing accounting processes, the THK Group decided to adopt the International Financial Reporting Standards (IFRS) beginning with the 2019fiscal year. To facilitate comparison with the 2019 fiscal year, the results from the 2018 fiscal year are also noted in accordance with IFRS.

12/20173

12/2018

12/2019

12/2020

12/2021

12/2022

12/2023

286,603344,718

274,599

218,998

318,188393,687

351,939

99,099145,238

84,675

115,517

134,660

108,740

67,194

59,79254,00157,54041,41048,55424,89633,592

72,112

101,985

29,27952,84831,03452,262(¥1 million)
400,000
300,000
200,000
100,000(¥1 million)
109,424
40,000289,278203.28285.23——2,140.71

2,198.17

62

85

65.4

57.9

20,000

10.2

15.3

6.0

0

9.9

13.3

0

7.0

11.2

(20,000)

12/1962.0
12/20

12/21

(%)
18.0
12.0

12/2259.012/23■ Operating Profit
0.67(Loss) (Left Scale)● Operating Margin (Right Scale)

30,99634,00622,021

16,594

67,46946,43018,2770(8,499)18,168281,754

40,00037,625

10,00025,729
12/19
12/20
12/21 36,100
12/22
12/23
436,664
471,369■ Japan ■ The
Americas ■ Europe ■ China■ Asia and Other

60,00046,09720,0000(¥1 million)

58,39030,00053,766

(6.0)

(%)
20.0

56,369

11,69012/19

78,68488,38462,507

69,839 40.0

68,662 60
28,624

84,04659,919 30.0
25,05633,7895.0
40
79,753

105,288

81,630 20.0

34,46023,707 10.0
25,28930,2680
20
29,984(9,992)12/22
12/21

12/20

12/23

(%)
50.0

15.0
49,014 80
10.0(9,725)(10,000)

(¥)
100

(5.0)

23,00735,596021,198 12/21
12/20

12/19

468,945
516,086 ■ Cash Dividends
560,304■
Profit (Loss) Attributable to460,173
Owners of the Parent (Left Scale)per Share (Left Scale)● Return on Revenue (Right Scale)● Payout Ratio (Right Scale)556,351

291,132

275,148314,289

337,281362,898

92.37(78.95)181.97172.67150.08———(¥1 million)

(%)
16.0
2,214.98

2,105.54

32

15

60

8.060.2

61.3

6.7

2,442.90 400,000

018,398
12/23

12/22

—

— (%)
2,914.23 80.0

2,707.51
87

46

63.7

65.8

69.1

(3.9)

9.5 200,000

8.8

6.7 40.0

0 4.2

(3.7)

8.1 100,000

6.7

5.3 20.0

4.1

(1.7)

6.3

6.6

12.0

4.0

(4.0)

59.812/19

57.9 12/22
12/21

12/20

12/23

300,000

0

59.0

12/19

59.2
12/20

60.0

4.7
12/21

12/22

64.2
12/23

● Return
Owners of the Parent (Left Scale)
0.58 on Assets (ROA)
0.47
0.65 ■ Equity Attributable to0.73
0.63● Ratio of Profit to Equity Attributable to Owners of the Parent (ROE)● Ratio of Equity Attributable to Owners of the Parent (Right Scale)

0.75

CO2 Emissions

Zero Emissions Rate

PRTR-Designated Substances(t-CO2)

(％)
0.50

(kg)
80,000120,000

0.40

90,00060,0000.30
60,00040,0000.20

30,0000

20,000

0.10

12/19

12/20

12/21

12/22

12/23

0

12/19

12/20

12/21

12/22

12/23

0

12/19

12/20

12/21

12/22

12/23

This data was taken from the following facilities:
CO2 Emissions: THK and Group companies in Japan
Zero Emissions Rate and PRTR-Designated Substances: Twelve production facilities in Japan (Yamagata, Kofu, Gifu, Mie, Yamaguchi, THK NIIGATA,THK INTECHS (Sendai and Mishima), NIPPON SLIDE, and THK RHYTHM (Hamamatsu, Inasa, and Kyushu))

HR Data0

12/2019

12/2020

12/2021

12/2022

12/2023

Number of Employees (Consolidated)

13,26012,914

13,073

13,502

13,360

Number of Employees(Non-consolidated)

3,891

3,957

3,968

4,058

4,068

Average Years of Service

17.3

17.6

18.1

18.2

18.4

Individuals on Childcare Leave

52

56

65

54

73

Turnover Ratio (%)

1.5

1.2

1.7

2.4

2.3

Percentage of Employees with
Disabilities (%)

2.30

2.32

2.23

2.19

2.25

1

Segments are based on the countryor region where THK’s customers arelocated.

2

Return on assets (ROA) represents
operating profit (loss) plus interest anddividend income as a percentage of average total assets.

3

This data reflects a modified reporting
period that includes 9 months from consolidated companies whose fiscal years

Apart from Number of Employees (Consolidated), all numbers reflect THK Japan only.

ended in March and 12 months fromconsolidated companies whose fiscal
years ended in December.

68

THK Integrated Report 202 4

Consolidated financial statements
1. [Consolidated Financial Statements](1) [Consolidated financial statements]

Consolidated
statements of financial position(i) [Consolidated statements of financial position](Millions of Yen)
Previous Fiscal Year
(December 31, 2022)
AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Goodwill and intangible assets
Investments accounted for using the equity
methodOther financial assets
Deferred tax assets
Retirement benefit asset
Other non-current assets
Total non-current assets
Total assets

Current Fiscal Year
(December 31, 2023)

163,835
96,665
77,6301,500
13,309352,942

156,486
78,621
82,460504
15,388333,462

172,342
9,321

186,556
9,492

6,814

6,960

10,571
5,305
2,926
80
207,361
560,304

10,724
5,891
3,182
80
222,889
556,351

Governance

Involvement in Society

Harmony with
the Environment

Data Section(Millions of Yen)
Previous Fiscal Year
(December 31, 2022)
Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Other financial liabilities
Provisions
Income taxes payable
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds and borrowings
Other financial liabilities
Retirement benefit liabilities
Provisions
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities
EquityCommon stock
Capital surplus
Retained earnings
Treasury stock
Other components of equity
Total equity attributable to owners of theparentNon-controlling interests
Total equity
Total liabilities and equity

Current Fiscal Year
(December 31, 2023)

51,631
22,961
3,732
129
7,169
17,538103,162

40,881
13,123
4,352
114
849
14,32073,643

97,917
9,130
4,256
179
5,939
2,437
119,860
223,023

95,639
8,491
6,278
171
6,488
2,740
119,810
193,453

34,60640,094245,941(17,160)
28,406

34,606
40,102
253,440(17,130)
46,245331,887357,264

5,393
337,281560,304

5,633
362,898
556,351

69

70

THK Integrated Report 202 4(ii) [Consolidated statements of profit or loss and consolidated statements of comprehensive income]Consolidated
statements
of profit[Consolidated
statements of profit
or loss] or loss

Previous Fiscal Year
(From January 1, 2022
to December 31, 2022)
393,687
288,398
105,288
58,991
2,015
14,421(Millions of Yen)
Current Fiscal Year
(From January 1, 2023
to December 31, 2023)
351,939
270,308
81,63058,958
2,318
1,322

569

40

34,4603,335
2,199
35,596
14,785
20,811

23,7072,446
864
25,2896,550
18,738

Profit attributable to:
Owners of the parent
Non-controlling interests
Profit21,198(386)
20,811

18,398339
18,738

Earnings per share
Basic earnings per share (yen)Diluted earnings per share (yen)172.67–150.08–

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other income
Other expenses
Share of profit of investments accounted forusing the equity method
Operating income
Financial income
Financial costs
Profit before tax
Income tax expense
ProfitGovernance

Involvement in Society

Harmony with
the Environment

Consolidated
statements of comprehensive income[Consolidated statements of comprehensive income]

ProfitOther comprehensive income
Items that will not be reclassified to profit or
loss
Financial assets measured at fair value
through other comprehensive income
Remeasurements of defined benefit plans
Share of other comprehensive income ofinvestments accounted for using the equity
methodTotal of items that will not be reclassified to
profit or loss
Items that may be reclassified to profit or loss
Exchange differences on translation offoreign operations
Share of other comprehensive income ofinvestments accounted for using the equity
methodTotal of items that may be reclassified to
profit or loss
Other comprehensive income, net of tax
Comprehensive income
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests
Comprehensive income

Data Section

Previous Fiscal Year
(From January 1, 2022
to December 31, 2022)
20,811(Millions of Yen)
Current Fiscal Year
(From January 1, 2023
to December 31, 2023)
18,738

(482)

532

649

(1,430)

(59)

54

108

(843)

20,937

17,442511

360

21,44917,802

21,55742,36916,95935,69742,086282
42,36935,145551
35,69771

72

THK Integrated Report 202 4

Consolidated statements of changes in equity(iii) [Consolidated statements of changes in equity]
Previous fiscal year (from January 1, 2022 to December 31, 2022)

Commonstock(Millions of Yen)
Equity attributable to owners of the parent
Other
components ofequityCapitalRetained
Treasury
Exchange
surplusearnings
stock
differences ontranslation offoreign
operations

34,606

40,413

233,607(11,237)

5,506

Profit––21,198––Other comprehensive
income––––20,779Total comprehensive
income––21,198–

20,779Purchase of treasury
stock

–

–

–

(5,958)–

Disposition of treasury
stock

–

3

–

36

–

Dividends––(9,460)––Changes in ownershipinterest in subsidiaries

–

(323)

–

–

948

Transfer from othercomponents of equity toretained earnings

–

–

595

–

–

Other

–

–

–

–

–

–

(319)

(8,864)(5,922)

948

34,60640,094245,941(17,160)

27,234

Beginning balance

Total transactions withownersEnding balance

Equity attributable to owners of the parent
Other components of equity
FinancialassetsmeasuredRemeasureat fairments of
Total
value
definedSubtotalthrough
benefitotherplanscomprehensive
incomeNoncontrollinginterests

Total
equity

1,658

–

7,165

304,555

9,733

314,289–––

21,198(386)

20,811(487)

595

20,88820,888669

21,557

Total comprehensive
income(487)

595

20,88842,086282

42,369Purchase of treasury
stock

–

–

–

(5,958)–(5,958)

Disposition of treasury
stock

–

–

–

39

–

39

Beginning balance
ProfitOther comprehensive
income5

Dividends–––(9,460)–(9,460)Changes in ownershipinterest in subsidiaries

–

–

948

624

(3,865)(3,240)Transfer from othercomponents of equity toretained earnings

–

(595)

(595)

–

–

–

Other

–

–

–

–

(758)

(758)

–

(595)

352

(14,754)(4,623)(19,377)

1,171–

28,406331,887

5,393

337,281

Total transactions withownersEnding balanceGovernanceHarmony with
the Environment

Involvement in Society

Current fiscal year (from January 1, 2023 to December 31, 2023)

Commonstock(Millions of Yen)
Equity attributable to owners of the parent
Other
components ofequityCapitalRetained
Treasury
Exchange
surplusearnings
stock
differences ontranslation offoreign
operations

34,60640,094245,941(17,160)

27,234

Profit––18,398––Other comprehensive
income––––17,590Total comprehensive
income––18,398–17,590Purchase of treasury
stock

–

–

–

(2)

–

Disposition of treasury
stock

–

8

–

31

–

Dividends––(9,807)––

Transfer from othercomponents of equity toretained earnings––(1,091)

–

–

Other

–

–

–

–

–

–

8

(10,898)29–

34,606

40,102

253,440(17,130)

44,825

Beginning balance

Total transactions withownersEnding balance

Equity attributable to owners of the parent
Other components of equity
FinancialassetsmeasuredRemeasureat fairments of
Total
value
definedSubtotalthrough
benefitotherplanscomprehensive
incomeNoncontrollinginterests

Total
equity1,171–

28,406331,887

5,393

337,281–––

18,398339

18,738535(1,379)16,747

16,747

211

16,959Total comprehensive
income535(1,379)16,74735,145551

35,697Purchase of treasury
stock

–

–

–

(2)

–

(2)

Disposition of treasury
stock

–

–

–

40

–

40

Dividends–––(9,807)–(9,807)

Beginning balance
ProfitOther comprehensive
incomeTransfer from othercomponents of equity toretained earnings

7
(287)

1,379

1,091

–

–

–

–

–

–

–

(311)

(311)

Total transactions withowners

(287)

1,379

1,091

(9,769)(311)(10,080)

Ending balance

1,419

–

46,245357,264

5,633

362,898

Other

Data Section

73

74

THK Integrated Report 202 4

Consolidated
statements of cash flows(iv) [Consolidated statements of cash flows]

Cash flows from operating activities
Profit before tax
Depreciation and amortization
Impairment losses
Increase or decrease in retirement benefit
assets or liabilities
Financial income
Financial costs
Share of profit of investments accounted forusing the equity method(Increase) decrease in trade and otherreceivables(Increase) decrease in inventories
Increase (decrease) in trade and otherpayablesOther
SubtotalInterests and dividends received
Interests paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment
Purchase of other financial assets
Proceeds from sales of other financial assets
Other
Net cash used in investing activities
Cash flows from financing activities
Repayments of long-term borrowings
Proceeds from issuance of bonds
Payments for redemption of bonds
Purchase of treasury stock
Dividends paid
Dividends paid to non-controlling interests
Repayments of lease liabilities
Payments for acquisition of interests in
subsidiaries from non-controlling interests
Net cash used in financing activities
Effect of exchange rate changes on cash andcash equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at the beginning of
the year
Cash and cash equivalents at the end of the year

Previous Fiscal Year
(From January 1, 2022
to December 31, 2022)(Millions of Yen)
Current Fiscal Year
(From January 1, 2023
to December 31, 2023)

35,596
20,834
13,641

25,28921,803
–

(413)

(409)

(3,335)
1,086(2,446)
1,589

(569)

(40)

(9,481)

22,035(9,714)(1,049)2,477(13,808)491
50,613
1,109(331)(13,830)
37,561(1,036)51,926
2,424(419)(14,599)
39,332(29,407)(27,045)

435

125

(551)
10
(568)
(30,081)

(366)
624
(433)
(27,094)(2,185)20,000–(5,958)(9,582)(766)(1,916)(2,185)
10,000(20,000)(2)(9,795)(349)(1,934)(3,240)–(3,649)(24,266)

8,573

4,680

12,404(7,348)151,430

163,835

163,835

156,486Governance

Involvement in Society

Harmony with
the Environment

Data Section

Segment information

1.

Segment information(1) Overview of reportable segments
The reportable segments of the Group are those for which separate financial information is available among
the Company’s constituent units, and are subject to regular review by the Board of Directors in order todetermine the allocation of management resources and evaluate performance.
The Group manufactures and sells machine element components such as LM (linear motion) guides and ballscrews, and transportation equipment element parts such as link balls and suspension ball joints. In Japan, theCompany and domestic subsidiaries are in charge, and overseas, independent local subsidiaries are in chargeof each region, and we are developing comprehensive strategies and developing business activities in eachregion.
Therefore, the Group’s compositional units are based on the manufacturing and sales system, and reportablesegments consist of five regional segments: Japan, The Americas, Europe, China, and Others.

75

76

THK Integrated Report 202 4(2) Information on reportable segments
Accounting policies for reportable segments are the same as the Group’s accounting policies.
Intersegment sales is based on prevailing market prices.
Previous fiscal year (from January 1, 2022 to December 31, 2022)(Millions of Yen)

Reportable Segments
Total

Adjustment Consoli(Note 3)
dated

22,614

393,687–

393,687

5,443

4,265

89,687(89,687)–

63,16988,75526,880483,374(89,687)

393,687(2,351)(9,684)

13,773

2,861

21,613

12,847

34,460

7,654

546

732

700

53

9,688

(6,352)

3,335

941

264

1,644

25

173

3,048

(849)

2,199

Japan

The
Americas

EuropeChina

Others144,189

80,85562,71583,312

79,270

253

453

Total

223,459

81,109Segment income (loss)(Note 4)17,014

Financial income
Financial costs

Revenue
Revenue to externalcustomers
Intersegment
revenue

Profit (loss) before tax

23,727(2,069) (10,595)

14,4492,741

28,252

7,344

35,596

Segment assets

451,156

91,454

107,745

100,490

38,251

789,098 (228,794)

560,304

Depreciation andamortization

8,111

3,738

3,072

4,644

1,093

20,660(286)

20,374

Impairment losses

1,286

2,094

9,620

1,009

12

14,024(382)

13,641

6,814

–

–

–

–

6,814

–

6,814

569

–

–

–

–

569

–

569

15,106

3,500

2,083

9,075

2,329

32,095–32,095

Other items

Investments
accounted for using
the equity method
Share of profit ofinvestments
accounted for using
the equity method
Capital investments(Notes)1. Country or region classification is based on geographical proximity.
2. Main countries or regions belonging to each category other than Japan and China(1) The Americas ······· the U.S.A., etc.
(2) Europe ··············· Germany, France, etc.
(3) Others ················ Taiwan, Singapore, etc.
3. Adjustments are as follows.
(1) Segment income (loss) adjustment of ¥12,847 million is the eliminations of intersegment
transactions.
(2) Segment assets adjustment of ¥(228,794) million is the eliminations of intersegment
transactions.
(3) Depreciation and amortization adjustment of ¥(286) million is the intersegment adjustments.
(4) Impairment loss adjustments of ¥(382) million is the intersegment adjustments.
4. Segment income (loss) is adjusted with operating profit (loss) in the consolidated statements ofprofit or loss.

GovernanceHarmony with
the Environment

Involvement in Society

77

Data Section

Current fiscal year (from January 1, 2023 to December 31, 2023)(Millions of Yen)

Reportable Segments
Total

Adjustment Consoli(Note 3)
dated

17,397

351,939–

351,939

4,544

3,749

66,785(66,785)–

70,95863,954

21,147418,724(66,785)

351,939

2,219

1,680

7,486

981

22,989718

23,707

6,058

1,367

2,034

483

158

10,102(7,656)

2,446

Financial costs

899

372

1,794

29

61

3,157

(2,292)

864

Profit before tax

15,778

3,215

1,921

7,940

1,078

29,934(4,644)25,289Segment assets

437,859

85,250118,445

102,325

43,514

787,393 (231,042)

556,351

8,792

3,862

2,813

4,645

1,369

21,484(202)

21,281

6,960

–

–

–

–

6,960

–

6,960

40

–

–

–

–

40

–

40

14,759

2,860

1,872

7,086

3,574

30,153–30,153Japan

The
Americas

EuropeChina

Others

115,357

89,22570,54859,41057,812

268

410

173,170

89,494

Segment income(Note 4)

10,619Financial income

Revenue
Revenue to externalcustomers
Intersegment
revenue
Total

Other items
Depreciation andamortization
Investments
accounted for using
the equity method
Share of profit ofinvestments
accounted for using
the equity method
Capital investments(Notes)1. Country or region classification is based on geographical proximity.
2. Main countries or regions belonging to each category other than Japan and China(1) The Americas ······· the U.S.A., etc.
(2) Europe ··············· Germany, France, etc.
(3) Others ················ Taiwan, Singapore, etc.
3. Adjustments are as follows.
(1) Segment income adjustment of ¥718 million is the eliminations of intersegment transactions.
(2) Segment assets adjustment of ¥(231,042) million is the eliminations of intersegment
transactions.
(3) Depreciation and amortization adjustment of ¥(202) million is the intersegment adjustments.
4. Segment income is adjusted with operating profit in the consolidated statements of profit or loss.
5. Effective the current fiscal year, capital investments of each reportable segment are disclosed
instead of capital expenditures. The reportable segment information for the previous fiscal year
presented in the previous page has been adjusted in accordance with this change.

78

THK Integrated Report 202 4(3) Information on products and services
Revenue to external customers for each product and service is as follows.
(Millions of Yen)
Previous Fiscal Year
(From January 1, 2022
to December 31, 2022)

Current Fiscal Year
(From January 1, 2023
to December 31, 2023)

Industrial machinery business

285,001

221,184

Automotive & transportation business

108,685

130,755

Total

393,687

351,939(4) Information by region
The regional breakdown of revenue and non-current assets is as follows.
Revenue to external customers(Millions of Yen)
Previous Fiscal Year
(From January 1, 2022
to December 31, 2022)

Current Fiscal Year
(From January 1, 2023
to December 31, 2023)

Japan

134,660

108,740

The Americas

78,68488,384

Europe62,507

69,839China

84,04659,919Other

33,78925,056

Total(Note) Revenue is based on the location of the sales destination.

393,687

351,939

Non-current assets(Millions of Yen)
Previous Fiscal Year
(December 31, 2022)

Current Fiscal Year
(December 31, 2023)

Japan

83,31688,415The Americas

24,98026,053

Europe21,59822,588

China

38,01942,178

Other

13,74916,813

181,663
196,049
Total(Note) Non-current assets are based on the location of the assets and do not include financial instruments,
deferred tax assets, and retirement benefit assets.
(5) Information on major customers
Not applicable as there is no single external customer whose revenue is 10% or more of consolidated revenue.
Pages 68 through 78 are a partial excerpt from the Annual Securities Report.
Please see the THK website (https://www.thk.com/) for the full text of the Annual Securities Reportand all included notes.

Governance

Involvement in Society

Harmony with
the Environment

Subsidiaries & Affiliate
Subsidiary79

Data Section

As of December 31, 2023

Main Operations

Location

Percentage Owned by
the Company, Directlyor Indirectly (%)

THK INTECHS CO., LTD.

Manufacture and sale of vital machinerycomponents and machineryTokyo, JapanTALK SYSTEM CO., LTD.

Sale of machinery parts and various types ofequipment

Tokyo, Japan

99.00

THK NIIGATA CO., LTD.

Manufacture of ball splines

Niigata, Japan

100.00

THK RHYTHM CO., LTD.

Transportation equipment-related businessShizuoka, Japan

100.00NIPPON SLIDE CO., LTD.

Manufacture and sale of slide rails

Tokyo, Japan

100.00TRA Holdings CO., LTD.

Holding and management company

Tokyo, Japan

100.00THK America, Inc.

Sale of LM Guide, ball screws

Illinois, U.S.A.

100.00

THK Manufacturing of America, Inc.

Manufacture of LM Guide, special bearings

Ohio, U.S.A.

100.00

THK RHYTHM NORTH AMERICA CO., LTD.

Transportation equipment-related business

Tennessee, U.S.A.

100.00

THK RHYTHM MEXICANA, S.A. DE C.V.

Transportation equipment-related businessGuanajuato, Mexico

100.00

THK RHYTHM AUTOMOTIVE MICHIGAN CORPORATION

Transportation equipment-related businessMichigan, U.S.A.

100.00

THK RHYTHM AUTOMOTIVE CANADA LIMITEDTransportation equipment-related business

Ontario, Canada

100.00THK Europe B.V.

Holding and management company

Amsterdam, Netherlands

100.00THK GmbH

Sale of LM Guide, ball screws

Ratingen, Germany

100.00THK France S.A.S.

Sale of LM Guide, ball screws

Tremblay-en-France, France

100.00

THK Manufacturing of Europe S.A.S.

Manufacture of LM Guide, ball screws

Ensisheim, France

100.00

THK Manufacturing of Ireland Ltd.

Manufacture of ball screws

Dublin, Ireland

100.00

THK RHYTHM AUTOMOTIVE GmbH

Transportation equipment-related business

Düsseldorf, Germany

100.00

THK RHYTHM AUTOMOTIVE CZECH a.s.

Transportation equipment-related business

Dacice, Czech Republic

100.00THK CAPITAL UNLIMITED COMPANY

Financing and capital management for affiliatedcompanies in the Americas

Dublin, Ireland

100.00THK FINANCE UNLIMITED COMPANY

Financing and capital management for affiliatedcompanies in Europe

Dublin, Ireland

100.00

THK (CHINA) CO., LTD.

Holding and management company, sale of
LM Guide

Dalian, China

100.00

THK (SHANGHAI) CO., LTD.

Sale of LM Guide, ball screws

Shanghai, China

100.00DALIAN THK CO., LTD.

Manufacture and sale of ball screws, actuators

Dalian, China

70.00

THK MANUFACTURING OF CHINA (WUXI) CO., LTD.

Manufacture of LM Guide

Wuxi, China

100.00

THK MANUFACTURING OF CHINA (LIAONING) CO., LTD.

Manufacture of LM Guide

Dalian, China

100.00

THK RHYTHM GUANGZHOU CO., LTD.

Transportation equipment-related business

Guangzhou, China

100.00

THK RHYTHM CHANGZHOU CO., LTD.

Transportation equipment-related businessChangzhou, China

100.00

THK MANUFACTURING OF CHINA (CHANGZHOU) CO., LTD.

Manufacture of LM-related parts, unit products

Changzhou, China

100.00

THK TAIWAN CO., LTD.

Sale of LM Guide, ball screws

Taipei, Taiwan

100.00

THK LM SYSTEM Pte. Ltd.

Sale of LM Guide, ball screws

Kaki Bukit, Singapore

100.00

THK RHYTHM (THAILAND) CO., LTD.

Transportation equipment-related business,
industrial machinery business

Rayong, Thailand

100.00

THK MANUFACTURING OF VIETNAM CO., LTD.

Manufacture and sale of LM Guide, slide rails

Bac Ninh, Vietnam

100.00

THK RHYTHM MALAYSIA Sdn. Bhd.

Transportation equipment-related business

Penang, Malaysia

80.00

THK India Pvt. Ltd.

Manufacture and sale of LM Guide

Karnataka, India

100.00Affiliate
SAMICK THK CO., LTD.

Main Operations
Manufacture and sale of LM Guide

100.00Location
Daegu, South Korea

Corporate Data
2-12-10 Shibaura, Minato-ku, Tokyo 108-8506
Phone: +81-3-5730-3911

Established

April 1971

Number of Employees

13,360 (consolidated); 4,068 (parent company)

Month of Ordinary General
Meeting of Shareholders

March

URL

www.thk.com

Independent Auditors

Grant Thornton Taiyo LLC

33.82

As of December 31, 2023

Company Profile
Headquarters

Percentage Owned by
the Company, Directlyor Indirectly (%)

Stock Information
Common Stock: A uthorized
Issued465,877,700 shares
129,856,903 shares

Stock Exchange Listing

Tokyo Stock Exchange (Prime Market)

Stock Transfer Agent

Mitsubishi UFJ Trust and Banking
Corporation

Number of Shareholders

18,170CATALOG NO.42-17E
20240716