Furukawa Electric Group
Sustainability Report2014

Web version（full report）
Update September 30, 2014

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric Group
Sustainability Report 2014

Contents
Top Message .................................................... 3

Material Flow...........................................................53
Targets and Performance of Environmental

Group Overview and Business Report .......... 5Conservation Activities..........................................54

Company Profile ....................................................... 5

Environmentally Friendly Products ......................56

Global Network ......................................................... 6

Preventing Global Warming ..................................60

R&D Laboratories, developer and producer .......... 7

Reducing Waste .....................................................62

Business Field .......................................................... 8

Water Resources ....................................................63

Key Indicators ........................................................ 11

Chemical Substance Management .......................64

AT A GLANCE ......................................................... 12

Environmental Risk Management .........................68

Non-financial Key Indicators................................. 16

Biodiversity Conservation .....................................70

Special Feature:
Across the Centuries ..................................... 19

Initiatives for Society ......................................71
Relations with Customers .....................................71
Relations with Business Partners ........................76

Management .................................................. 26

Relations with Shareholders .................................79

CSR Management................................................... 26

Relations with Employees .....................................81

Corporate Governance .......................................... 30

Relations with Communities ...............................101

Risk Management................................................... 32

Relations with Public Policy ................................107

Compliance ............................................................. 36
Targets and Results ............................................... 40
Editorial Policy .....................................................108

Initiatives for the Environment .................... 44

Third-Party Opinion .............................................. 110

Environmental Management ................................. 44

History of Furukawa Electric's CSR Activities ... 113
GRI Guideline Table of Contents ......................... 114

2

Furukawa Electric Group Sustainability Report 2014: Web version- In 2014, Furukawa Electric is celebrating the 130th anniversary of its establishment. What are the reasons
behind its long success as one of Japan's top companies?
Since our establishment in 1884, the main focus of our business has been on building infrastructure (which
provides the foundations for both society and industry) as a cable and non-ferrous metals manufacturer usingmaterials technologies in a wide range of fields, including copper, aluminum and resin. Our products andservices have been recognized by society and gained an excellent reputation because all of our employees have
kept their eyes focused firmly on the future no matter what business environment they have faced. We have also
continued to listen to the expectations and demands of society, which change on a daily basis, and maintained
an approach of continuously trying to create new business through technological innovation. The fact that wehave continued to receive the support of our stakeholders is another reason for our success.
- So it's extremely important to maintain an attitude of wanting to contribute to society and to continue taking on
the challenges of technological innovation. In addition to making a social contribution by providing services, doyou think there have been any environmental reasons why the company has continued to flourish?
The fact that Furukawa Electric has been able to secure a continuous supply of the mineral resources used inmany of our products, including raw materials such as copper, is a major reason why our company has been able
to continue in business for such a long time. In other words, we have continued to enjoy the benefits of ourecosystem for the past 130 years. For this reason we have carried out the recovery and recycling of resourcesfrom an early stage. For example, we have recovered the copper wires used in scrapped electric cables andused them in manufacturing; we have recovered and reused offcuts arising in the manufacturing of processed
copper products; and we have carried out recycling as a matter of course since long before the word “recycling”
came to be widely used. We have also recycled waste plastic and used it in cable pipe products.
- Could you tell us about the important challenges faced by Furukawa Electric in ensuring that the business
continues to flourish in the future and the measures you are planning in order to achieve this?

3

Furukawa Electric Group Sustainability Report 2014: Web version

As set out in the medium-term management plan concept, we will focus on the infrastructure and automotive
markets, which are expected to see significant growth in global terms and for which there is a strong need fortechnological innovation. We believe it is important to develop new next-generation business. These initiatives
are founded in an approach of “wanting to use Furukawa Electric business to help solve society's problems
around the world”.
In the infrastructure market, our challenges lie in how to use energy as efficiently as possible given the global
energy problems, and in doing so how to produce smart infrastructure that can be controlled as intelligently as
possible. Major challenges include using optical telecommunications (a field in which Furukawa Electric excels)
to create systems that use electric power efficiently. We also need to unite as a group in order to take on thechallenge of creating the new technologies that will allow us to achieve this.
In the automotive field, improving the efficiency of fossil fuels and electric power (energy) and achieving energy
savings are global challenges. An important challenge for Furukawa Electric Group is to integrate opticaltelecommunications and electric power technologies into the automotive parts-related technologies that we havebuilt up over many years, and to incorporate this as new technology.
- Lastly, above all else what do you think will provide the foundations for the company to continue succeeding inbusiness?
The foundations for the company's business activities can be found in the attitude of each and every employee,
and the basic premise of safety, quality and compliance. Furukawa Electric Group has set down the behavior it
expects from its officers and employees regarding corporate social responsibility in our “Furukawa Electric GroupCSR Code of Conduct”. In addition to legal compliance, this requires that officers and employees act inaccordance with social norms and corporate ethics, and improve their awareness and practice of safety andquality.
Over the past few years, our whole group has worked together to prevent any recurrences of competition law
violations, and we have developed a system to handle international regulations governing bribery. Moreover, ourefforts to recover from the snow damage that occurred at Nikko Works in February this year (2014) gave us
practical experience of BCM (business continuity management), and we have launched initiatives to make use ofthis experience as a way of strengthening BCM across the group. Moving forward, we intend to monitor the
status of our organizational platform from a global perspective and to help solve global problems through ourbusiness activities as we focus our efforts on creating more value for society.
Lastly, please allow me to express my hope that as many people as possible read this report so that Furukawa
Electric becomes even more widely known.
- Thank you for your answers.

4

Furukawa Electric Group Sustainability Report 2014: Web version

Group Overview and Business ReportCompany Profile
Company Name

Furukawa Electric Co., Ltd.

President

Mitsuyoshi Shibata

Founded1884

Established

1896

Paid-in Capital(As of March 31, 2014)¥69,395 million

Net sales(Years ended March 31, 2014)¥931,781 million (Consolidated)¥428,301 million (Non-Consolidated)

Number of Employees(As of March 31, 2014)

47,045 (Consolidated)
3,590 (Non-Consolidated)

Head Office

Marunouchi Nakadori Bldg., 2-3, Marunouchi 2-chome, Chiyodaku, Tokyo
100-8322, JapanTEL+81-3-3286-3001

Major Products and Services
Telecommunications
Optical fiber cables / Metal communication cables / Semiconductor optical devices / Electronic appliance wires /Optical components / Network equipment / Optical fiber cable accessories and installations / CATV system /Radio products, etc.

Energy and Industrial Products
Copper wires and Aluminum wires / Power transmission cable / Insulated wires / Power transmission cable
accessories and installations / Cable conduits / Water-feeding pipe materials / Foam products / UV tapes forsemiconductor manufacturing / Electrical Insulation Tape / Electric material products, etc.

Electronics and Automotive Systems
Automotive components and wiring harness / Magnet wires / Electronic component materials / Heatsinks / Hard
disc drive (HDD) aluminum substrates / Battery products, etc.

Metals
Copper and copper alloy products (plates, strips, pipes, rods, foils, and wires) / Functional surface products(plating)/ Electrodeposited copper foil / Pocessed products for electronic parts / Superconducting products /Special metal materials (Shape-memory and super-elastic alloys), etc.

Light Metals
Aluminum plates / Extruded aluminum products / Casting products / Forged products / Processed light metal
products, etc.

5

Furukawa Electric Group Sustainability Report 2014: Web version

Services and Others
Logistics / Information processing service / Software development / Service business (real-estate leasing,hydraulic power generation and so on), etc.

Global Network

6

Furukawa Electric Group Sustainability Report 2014: Web version

R&D Laboratories, developer and producer

FETI: Furukawa Electric Instituteof Technology (Hungary)
http://www.furukawa.co.jp/kenkai/en
g/profile/feti.htm- Simulation development- Algorithm development- Process optimization

Metal ResearchLaboratories (Nikko)

OFS Labs. (USA)SuperPower (USA)

http://www.furukawa.co.jp/kenkai/eng/profile/ofs.htm

http://www.furukawa.co.jp/ken
kai/eng/profile/superpower.htm- Fibers- Components- 2G HTS wir

Power & System
Laboratories (Chiba)

Polymer Materials R&D
Laboratories (Hiratsuka)

FITEL Photonics
Laboratories (Chiba)

Power & System
Laboratories (Hiratsuka)
Automotive System & Device
Laboratories(Hiratsuka)

7

Yokohama R&D
Laboratories (Yokohama)Furukawa Electric Group Sustainability Report 2014: Web version

Business Field

Telecommunication
Optical communication is an advanced technology that meets the needs of thecommunication age, Furukawa Electric provides diversified support for
information-oriented society.
We are living in an age of global communication. Currently, the Internet Links the entire world, allowing
information from overseas to be obtained in real time, not only in offices but also at home. In this advanced
information-oriented society, optical communication systems are a key technology for enabling people to access
important information easily. Furukawa Electric is firmly supporting an ideal base for communication by providing
various technologies and products that realize the "FTTH" project, in which optical fiber networks are provided tohomes.
Telecommunication Products
http://www.furukawa.co.jp/english/seihin/it.htm

Electronics
Ever-evolving Semiconductors and their Peripheral Technologies Amplify
New Possibilities for the Electronics Industry.
Semiconductors are the basis on which electronic products are continually decreasing in size, and increasing infunctional capability at a rapid pace. In LSIs, several hundred thousand to tens of millions of electronic
components are incorporated on a chip in an area of several square mm, to process large amounts of information.
In the field of semiconductors, Furukawa Electric has developed many products ranging from compound
semiconductors to complete devices. It has also provided various other products that are densely mounted in the
periphery of semiconductors; reflow ovens for mounting these products; and heat pipes essential for coolingmicroprocessors. Each of these products is backed by reliable, established technologies.

8

Furukawa Electric Group Sustainability Report 2014: Web version

Electronics Products
http://www.furukawa.co.jp/english/seihin/electronics.htm

Automobile
Themes Are Safety, Comfort, and Harmony with Environments. Furukawa Is Challenging
Transportation Possibilities Using Total Technologies.
In the field of transportation including automobiles, trains, ships, airplanes, and H II rockets, Furukawa Electric
combines its proprietary material, electronics, and mechatronics technologies to develop various products
forming comfortable transportation environments. In particular, in the field of automobiles, we offer various
electronic components and aluminum body materials including wire harnesses. Furthermore, we are challenging
advanced technologies such as ITS systems and has established a firm status as an indispensable supplier forthe automobile industry.
Automobile Products
http://www.furukawa.co.jp/english/seihin/car.htm

EnergyUsing Total Technologies to Construct Advanced Power Networks While Meeting the
Needs for Energy Saving and Environmental Preservation
Few things are as essential for our daily lives and industries as electric power. Furukawa Electric has been
meeting the increasing electric power demand through "power transmission systems" and "power distribution
cables". We are also actively responding to the demands of the times for resource saving and environmental
preservation. Furukawa is contributing to society by providing various leading-edge technologies such as
superconductors and solar generation systems, which are the focus of wide spread attention as energy sources
for the next generation.
Energy Products
http://www.furukawa.co.jp/english/seihin/energy.htm

Construction
Unifying Advanced Material and Processing Technologies Together While Creating
Amenity Environments for Cities, Buildings, and Housings
What is a comfortable space? Whether it is required in a city or a building, constructing such a space requires
correct perspective and advanced technologies for achieving ideals. While applying the accumulated
technologies, Furukawa Electric has been developing various products supporting comfortable lives. Our
objective for pursuing harmony between the functions of peoples' lives and environments is found in each of our
products ranging from construction materials through wire materials and fire prevention products to housing
facilities.
Construction Products
http://www.furukawa.co.jp/english/seihin/construction.htm

9Furukawa Electric Group Sustainability Report 2014: Web version

Material
Constant Challenges to Material Renovation and Development of New Materials Are
Facilitating Unlimited Extension of Applications in Every Industry.
Over 120 years since its establishment, Furukawa Electric has been constantly offering advanced materials
ranging from copper and aluminum materials to wires and cables, as well as various related materials. Constantchallenges to material innovation are facilitating creation of materials with new potentiality and unlimited
extension of applications from familiar products to the high technology field. These materials dramatically change
our lives and the foundation of the industries.
Material Products
http://www.furukawa.co.jp/english/seihin/material.htm

10Furukawa Electric Group Sustainability Report 2014: Web version

Key Indicators(Years ended March 31)

Net Sales

Operating income (loss)

Operating income (loss)(Ratio to net sales)

Net income (loss)

Net income per common share

Return on equity

Cash flows(note) Shareholders' equity excludes minority

interest and gain and loss on deferred hedge.

11

Furukawa Electric Group Sustainability Report 2014: Web version

AT A GLANCE
Net sales by Main Business Segment (Consolidated, fiscal year 2014)

Conventionally sized ITLA (top)and micro ITLA (bottom)(note) Figures excludes intersegment transactions

Telecommunications
Optical Fiber and Cable
Japan: We have achieved effects from structural reforms by merging production bases.
Europe and United States: Cuts to fixed costs during the second half of FY2014 made a full contribution andthe market is continues to move towards recovery.

Brazil: LAN solutions and fiber optic business expanded.

Optical Parts and Networking Equipment
Japan, China and United States: Demand for new products (ITLA/ integrated signal light sources) to
supply next-generation high-speed telecommunications (digital coherent telecommunications) expanded.

Factory of FISA (Brazil)

Conventionally sized ITLA (top)and micro ITLA (bottom)

12Furukawa Electric Group Sustainability Report 2014: Web version

Net Sales

Operating Income

Energy and Industrial Products
Ultrahigh-Voltage Transmission Cables
Japan: Submarine power cables for offshore wind power generation were developed.
China: A Chinese subsidiary improved its cost structure and promoted sales expansion in overseas markets.

Industrial Products
Europe: Improvements were achieved through the sale of unprofitable Russian bases, etc.
Japan: Strong demand is expected to continue for cableprotecting conduit line materials in mega-solar
applications.

Shenyang Furukawa Cable Co., Ltd.
(China)Net Sales

Laying a submarine transmission cable

Operating Income

13Furukawa Electric Group Sustainability Report 2014: Web version

Electronics and Automotive Systems
Automotive Parts
Japan: Despite an expected fall in demand caused by the increase in consumption tax and other factors, strong
sales of wire harness for new models are expected to cover the impact of reduced production in Japan.
Overseas: We have begun to achieve the potential of new wire harness bases in Asia and Mexico and promoted
an expansion in SRC sales in South America.

Wire Harness factory (China)

SRC (Steering Roll Connector)

Net Sales

Operating Income

Metals
Copper foil
Japan: Conditions are expected to improve after realizing the effects of production base centralization andcompleting the transfer of manufacturing to Taiwan.
Taiwan: Battery foil business is expected to grow, particularly in automotive applications, and circuit foil volumes
are expected to recover.

Copper strips
Japan: A fall in operating income of 3.6 billion yen is forecast as a result of the impact of snow damage inFebruary at Nikko Works. We plan to achieve complete restoration by the end of the year.

14

Furukawa Electric Group Sustainability Report 2014: Web version

Electrodeposited copper foil

Net Sales

Furukawa Electric Copper Foil
Taiwan Co., Ltd.

Operating Income

Light Metals
Rolled Aluminum Products
Only the first-half operating income was recorded in FY2014 because of the inauguration of UACJ in October
2013. In the second half of FY2014, operating income was recorded as “equity in net income of affiliates” under
non-operating income.

Net Sales

Operating Income(note) Since the second half of fiscal 2014 and fiscal 2015 it has been recorded in equity in net incom of affiliates

15Furukawa Electric Group Sustainability Report 2014: Web version

Non-financial Key Indicators

Number of Group Employees by Region (Consolidated)

Gender ratio of Employees (Furukawa Electric)

16

Furukawa Electric Group Sustainability Report 2014: Web version

Gender ratio of Managers (Furukawa Electric)

Employee turnover rate by gender (Furukawa Electric)

Environmentally friendly products as a percentage of sales

17Furukawa Electric Group Sustainability Report 2014: Web version

CO2 emissions(note 1) The amount of power consumed is calculated using the emission factor of each power company.
(note 2) Assuming that hydroelectric power produces zero CO2 emissions.
(note 3) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.

Energy consumption(note) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.

Processing volume of non-recyclable waste(note) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.

18

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric celebrates its 130th Anniversary. Our success is thanks to the ongoing patronage and supportof our customers and shareholders, and we would like to take this opportunity to express our heartfelt
appreciation to them.
Our corporate philosophy is to contribute to the realization of a sustainable society based on expertise in thedevelopment and fabrication of advanced materials, through continuous technological innovation. Furukawa
Group's founder, Ichibei Furukawa, worked to build Japan with an aim of “making Japan brighter.” He made theutmost effort to introduce technology as quickly as possible from Europe and the U.S. that were way ahead ofJapan at that time and create world-class products.
We have inherited this mission from him and have a big sense of responsibility to make the world brighter.
Looking back on what we have done for 130 years, we would like to keep trying as a company making social
contributions.

The Founder’s Philosophy
The Path of Our Founder
In 1884, 130 years ago, our company began smelting copper in Honjo, Tokyoand manufacturing electric wires in Takashimacho, Yokohama. This isregarded as the foundation of our company.
Ichibei Furukawa, the founder of Furukawa Group, was born in Kyoto in 1832.

Company logo/Yamaichi markHis natural ability in business helped him rise to a senior position at Ono Group, awealthy merchant group at that time. When Ono Group became bankrupt hebecame penniless. However, he received encouragement from acquaintancesuch as Eiichi Shibusawa and Munemitsu Mutsu, and in 1877 he began operating
the Ashio Copper Mine. He overcame several crises to help the mine become thelargest copper mine in Japan.
The Yamaichi logo, which is the Furukawa Electric company logo, was firstregistered in 1877 under the slogan Kogyo Sen-itsu (“Mining Above All”).
He introduced state-of-the-art Western technology to expand the company's

19

Ichibei Furukawa

Furukawa Electric Group Sustainability Report 2014: Web version

industrial capacity, including the construction of Japan's first full-scale hydroelectric power plant in 1890, and built
the foundations for Furukawa Group.

The Founder's Philosophy
Ichibei set down a management philosophy - “Value people,” “Value customers and society” and “Incorporate thelatest technology” - and used his enthusiasm and his ability to get things done to open the way to a new era. In
today’s terms, his philosophy equates to fostering human resources who value health, safety and complianceand contributing to customers and society through the main business. This means we need to take on every
challenge we are faced with in order to achieve our goals. This approach has been handed down through thelong history of companies that have made up Furukawa Group, and our repeated efforts to value all people,
including customers and employees, at the same time as taking on new challenges without fear of failure, havecreated the companies we have today. This is also reflected in Furukawa Electric Group’s corporate philosophy:“Drawing on more than a century of expertise in the development and fabrication of advanced materials, we willcontribute to the realization of a sustainable society through continuous technological innovation.”
Ichibei left us with the memorable phrase Un-Don-Kon. He said that in order to achieve big things people need“Un” (good luck), “Don” (stubbornness), and “Kon” (perseverance). “Don” in particular refers to being stubbornly
honest in your work. In other words, this means refusing to accept other people’s opinions too easily; the more
people think you are wrong, the more you need to carry out what you are doing with strong belief. Thisphilosophy can be clearly seen in Ichibei’s approach to his own life.

20

Furukawa Electric Group Sustainability Report 2014: Web version

COLUMNSocial Contributions in Addition to Our Main Business
Since our foundation, Furukawa Electric has sought to contribute tosociety in ways other than just through our main business. For example,
to commemorate the visit of Emperor Taisho, and Empress Teimei tothe Nikko Works in September 1913, the Nikko Waraku-odori festival
has been held ever since 1914. The festival started out as a way ofrecognizing the hard work of the employees. However, it has continued
for over 100 years and has now become an established feature of thelively summer festival season in Nikko and numerous local people takeNikko Waraku-odori in 1961

part.
Furukawa Electric is also active in sports, and in 1955 it named soccer, ice hockey, volleyball and rowing as theofficial company sports with the aim of improving employee morale and contributing to local society. Furukawa
Electric Soccer Club continues to this day as J-League team JEF Chiba.

Contributing to broadcasting infrastructure by installing the antenna on Tokyo Tower
Furukawa Electric installed the antenna on Tokyo Tower during its construction in
1958. This led to the start of a fully-fledged age of television broadcasting. The
decade after 1955 was a time when Japan achieved rapid development throughstrong economic growth and recovery from World War II.
In 1964, the Tokyo Olympics were held. People were in exuberant spirits thanks
to the information they received via television. Living standards improved andJapan accelerated towards modernization. The Tokyo Tower antenna continues
to tower majestically over its surroundings and has made a significant mark on
Furukawa Electric’s broadcasting business.
Furukawa Electric's technology has continued to be used in later years, including
during installation of the antenna on the Tokyo Skytree.

21

Tokyo Tower

Furukawa Electric Group Sustainability Report 2014: Web version

Developing and Expanding the Telecommunications Network in Bangkok
In 1968, a plan was set out by Telephone Organization of Thailand operator to
upgrade the telephone network in the metropolitan region of Bangkok.
Furukawa Electric succeeded in receiving the order for the project despite
competition from leading companies around the world. The project involved
installing 21 telephone exchanges and 122,500 terminals throughout the cityof Bangkok and was the largest project in the history of telecommunications
cable exports. What’s more, we accumulated know-how in relation to overseas Telecommunications Network inprojects and accelerated our business in developing countries.

BangkokPower Transmission Line Installation in IranThe biggest overseas projects Furukawa Electric has taken on was a large
order we received from the Iran organization for electric power affairs for the
installation of power transmission lines. This was a huge project. During thefour years between signing the contract in 1978 and completion of the work in
1982 we overcame numerous difficulties and trials, including a revolution in
the Iranian political system and the chaos brought about by the Iran-Iraq War.
Moreover, the route for installation traversed paddy field zones, forest zones
and desert zones, and we had to cross the Alborz Mountains to the north ofPower Transmission Line
Installation in Iran

Tehran, which contains a series of mountains above 4,000 m.
The companies that were working together on the project finally managed to complete the installation of powertransmission lines with a total length of 449 km despite the harsh environmental conditions. The technologicalprowess of Furukawa Electric was highly regarded by the Iran organization for electric power affairs and the
project made a major contribution to our future overseas power transmission line installation projects.

22Furukawa Electric Group Sustainability Report 2014: Web version

Contributing to the Construction and Development of Telecommunications
Infrastructure
Improvements in internet technology have made a large contribution to theglobalization of corporate activities and the safety of society, including crisis
management in times of disaster, as well as the collection of big data that
contributes to marketing, and improvements in convenience brought about by
smartphones.
Optical amplifiers

In the pioneering days of optical fibers, Furukawa Electric was the first company
in the world to produce long-distance optical fiber cables, opening the way to the realization of opticaltelecommunications infrastructure. In addition to optical fiber cables, Furukawa Electric has developed asuccession of peripheral technologies that are required to build infrastructure, including the optical amplifier
pumping lasers that are essential to longdistance telecommunications, frequency-division multiplexing that isnecessary to expand telecommunications capacity, improvements in installation efficiency and innovations inconnections technology. In this way, Furukawa Electric has supported to develop telecommunications
infrastructure with advanced technologies.

Contributing to the Safety and Ecology in Cars
SRC (Steering roll connectors) are a core component of airbag systems,
which protect passengers from impact during accidents. Furukawa Electric's
SRCs maintain reliable operational performance in vehicle conditions ranging
from below freezing in cold regions to above 50°C at the height of summer.

SRC (Steering roll connectors)

This reliability has been recognized in our top share of the global market.
There is a constant demand to make cars lighter. Furukawa Electric supports improvements in fuel efficiency andcomfortable driving by maintaining the reliability of wire harnesses, which have increasingly complicated signal
paths for vehicle computers, while achieving the required weight specifications by reducing every gram wherever
possible.

23

Furukawa Electric Group Sustainability Report 2014: Web version

Contributing to the Discovery of the Higgs Boson through Superconductivity
Technology
In the 1960s Furukawa Electric worked on developing superconducting wires,and in the 1980s we became one of the world's few manufacturers of
low-temperature superconducting wires. Experiments to confirm the existenceof the Higgs boson at CERN in Europe (which has been referred to as the“discovery of the century”) required a huge superconducting magnet.
Furukawa Electric was presented with the Golden Hadron Award inrecognition of its efforts in supplying the huge volume of superconducting wires

Inside the Large Hadron Collider(LHC)

needed for this magnet.
Furukawa Electric is currently working on the development of thirdgeneration yttrium high-temperature
superconducting wires and cables, and in Shenyang, China in 2013 we succeeded in carrying out the equivalentof 30 years of current testing on superconducting cables capable of transmitting 275kV for 1,500,000 kVA, which
was the highest standard ever achieved in the world at the time.

Growth Strategies in the Telecommunications Infrastructure Market
Global telecommunications traffic is expected to continue increasing
dramatically, particularly in newly-emerging economies. Furukawa ElectricGroup is making full use of the optical fiber photonics technologies it has
accumulated in order to develop products capable of contributing to an increasein capacity.
Overseas, we are using single management at our global bases in order tocapture demand in growth markets efficiently. In Japan, we have reorganized
our production bases, established a supply system to match demand and promoted cost reductions.

24

Furukawa Electric Group Sustainability Report 2014: Web version

Growth Strategies in the Energy Infrastructure Market
Over many years, Furukawa Electric Group has contributed to the construction of
the energy network. We intend to make full use of the know-how accumulated
during this time to handle burgeoning infrastructure demand, particularly in Asia,
while also contributing to the realization of a smart-grid society that uses energy
efficiently.
For example, we are promoting the development of high temperature
superconducting power cables, which make major reductions in transmission losses,
as well as products for use in various superconducting applications, such as coils.
High-temperature
super-conducting power
cablesGrowth Strategies in the Automotive Market
Furukawa Electric Group will utilize its unique materials technologies tocontribute to more environmentally-friendly cars, including through thedevelopment of lighter car parts and improvements in energy efficient, in orderto help realize a low-carbon society.
We will strengthen our sales and design capabilities at overseas bases,
expand our production bases, particularly in Southeast Asia and Central andSouth America, and expand the size of our trading area in overseas markets. Furthermore, we will strengthen our
procurement function, and work to make thorough reductions in cost prices, including the cost of materials,
processing costs and fixed costs.

25

Furukawa Electric Group Sustainability Report 2014: Web version

Management
CSR Management
Group Philosophy
Since our founding in 1884, we have been working to create the technologies and products that society requires
over the past 130 years. We consider it our mission to contribute to the realization of a sustainable society. We
will continue to keep our eyes on the future as we work to live up to the expectations and trust invested in us bysociety.

Furukawa Electric Group Philosophy (Revised August, 2007)
http://www.furukawa.co.jp/english/kaisya/philosophy.htm

Basic Policy and CSR Code of Conduct
Each of the companies in Furukawa Electric Group develops CSR activities in line with the following Group basic
policy.

Furukawa Electric Group Basic Policy on CSR (Revised March, 2011)
Based on the Furukawa Electric Group Corporate Philosophy,
We will operate our businesses in harmony with society and the environment and endeavor to create social
value through technological innovation, complying with laws, social norms, and ethics as a member of theinternational community.
We will strive to maintain and build sound and friendly relationships with all of our stakeholders and contributeto the sustainable development of society.
The CSR Code of Conduct defines fundamental rules of behavior for Furukawa Electric executives andemployees to follow in conducting corporate activities based on the Group philosophy and from the perspectiveof corporate social responsibility.

26

Furukawa Electric Group Sustainability Report 2014: Web version

The Furukawa Electric Group CSR Code of Conduct (Revised March, 2011)
1. Human rights
2. Working conditions and environment
3. Environment
4. Products and services
5. International businesses and transactions
6. Fair competition
7. Relations with customers, partners, and society
8. Management and preservation of Company assets
9. Disclosure of information
10. Duties and obligations of senior management and employees

Basic Approach
In order to contribute to the realization of a truly rich and sustainable society, we need to understand the social
responsibilities of Furukawa Electric Group and implement policies in line with the Basic CSR Policy. We will
promote CSR initiatives alongside our business activities so that each and every Group employee is able to takethe lead in putting CSR initiatives into practice.

CSR Promotion Framework
Furukawa Electric Group has established the CSR and Risk Management Committee, which comprises
members of management, as the structure for supervising and promoting CSR activities throughout the Group,
including risk management, internal control, compliance and social contribution. We have set up the CSR
Department within our Administration & CSR Division. This department promotes CSR by facilitating
communication among various committees and corporate departments.

27

Furukawa Electric Group Sustainability Report 2014: Web version

CSR Promotion Framework

Stakeholder Relations
Furukawa Electric Group properly monitors our business practices and endeavors to establish structures for
improving them even more, so as to steadily meet our responsibilities to our various stakeholders, who view us
from differing perspectives.

Main Stakeholders and Main Responsibilities

28

Furukawa Electric Group Sustainability Report 2014: Web version

Main
Stakeholders

Main Responsibilities

Means of Communication

Reduce emission of gases that contributeto global warming
Promote energy conservation andrecycling
Protect biodiversity
Curtail industrial waste
Manage and reduce harmful chemical
substances

Compliance with laws and regulations
Compliance with the Kyoto Protocol and the Nagoya Protocol
on biodiversity
Response to environmental activities of the Ministry of theEnvironment and other government organs
Research and information exchange on biodiversity
preservation through JBIB(note 1)

Customers

Maintain and improve the quality of
products, operations and services
Offer products and services that are
useful to society
Provide solutions to issues confronting
customers through a broad array oftechnologies and know-how

Dialogue through regular business
Website, Sustainability Reports
Dialogue at technology exhibitions, trade shows

Suppliers

Establish a sound relationship founded onfair trading in compliance with laws andregulations
Realize CSR throughout the supply chain
by implementing CSR Deployment
Guideline for Business Partners

Partner Meetings
Dialogue through regular business
CSR surveys
Feedback interviews on results of partner evaluations

Provide appropriate returns
Ensure timely and appropriate disclosure
Enhance corporate value

Sustainability Reports
General meetings of shareholders, shareholder reports
Management briefings and results presentations
Investor visits
Shareholder plant tours

Respect human rights
Cultivate and appropriately value andreward human resources
Promote health, including occupational
health and safety, as well as mental
healthSupport diverse workstyles and work/lifebalance

Internal newsletter, intranet
Management briefings

Nurture future generation
Promote sporting and cultural activities
Live in harmony with the naturalenvironment and local
communities

Factory tours
Cooperate with and sponsor sports and traditional events
Support the activities of and collaborate with local NPOs
Preserve the Satoyama Environment

Environment

Shareholders

Employees

Local
communities(note 1) JBIB : Japan Business Initiative for Biodiversity. Founded in 2008, the JBIB is a joint effort by Japanese companies toact on behalf of biodiversity preservation.

29

Furukawa Electric Group Sustainability Report 2014: Web version

Message from the General Managers

Nowadays, companies are required to respond to a rapidly changing world
with a variety of stakeholders in mind. As Furukawa Electric Group sets
about this task, CSR activities are an essential part of our survival as abusiness. Furukawa Electric Group has set out a basic policy and code of
conduct for CSR in accordance with a group philosophy that seeks to meetthe expectations of our founder, in addition to developing a variety of related
systems and mechanisms. The management report contains information ona variety of initiatives, with a focus on the platform of CSR activities,
including corporate governance, risk management and compliance.
In the medium-term, we aim to examine ways of narrowing down priority fields in CSR for Furukawa ElectricGroup and promoting policies that strengthen communication with our stakeholders.

Takashi Fukuda
General Manager, CSR Department, Administration & CSR DivisionCorporate Governance
Basic Philosophy
Based on the Furukawa Electric Group Corporate Philosophy, the Furukawa Electric Group strives to enhance its
performance by promptly responding to changes in the business environment and the market through efficientmanagement based on prompt decision making. At the same time, we ensure sound management by developing
and establishing an internal control system and applying it effectively. We uphold the basic policy of seeking to
expand and develop our operations on a sustainable basis and to raise corporate value through these efforts.
We operate our businesses in harmony with society and the environment in accordance with appropriate
corporate information disclosure, compliance, and risk management, so we strive to maintain and build soundand friendly relationships with all of our stakeholders, including shareholders, business partners, local
communities and employees, and contribute to the sustainable development of society.

30

Furukawa Electric Group Sustainability Report 2014: Web version

Corporate governance organization chart

31

Furukawa Electric Group Sustainability Report 2014: Web version

Risk Management
Overview of the Risk Management Structure
Our CSR and Risk Management Committee conducts regular risk assessments to determine what risks exist,
define important risks that require a companywide response and prioritize measures to counter these risks.
Through specialized committee activities in segment-specific areas—environment, quality, safety, disasterprevention—we are working to manage the risks that relate to our business activities.
Important Companywide Risks
 Compliance Quality control
 Large-scale disasters, such as earthquakes
 Information security
 Affiliated company controls
In the event a large-scale disaster occurs or other such risk materializes, the Group will establish Emergency
Response Headquarters, headed by the president, and Site Response Headquarters that defines eachdepartment's roles and clarifies them ahead of time. We also conduct regular exercises on preparating initialaction manuals, stockpiling necessary supplies, and setting up communication structures and systems to confirm
people's safety.

Business Continuity Management (BCM)
Execution of BCM exercise and its results
In fiscal 2014, we conducted a BCM exercise at our headquarters and business units in Chiba and Hiratsuka
Works. At the headquarters, we extended the scope of the exercise participants, offered a tour that includes aconfirmation of stockpile places and an explanation on various tools in addition to the regular exercise menu, andhad a discussion on the exercise topics prepared by the administrative office. After the exercise, we revised
various manuals based on the exercise results and posted “general instructions for foreign visitors at the time oflarge-scale earthquake” in various different languages at the reception and meeting rooms of the headquarters.

32

Furukawa Electric Group Sustainability Report 2014: Web version

Stockpile confirmation tour

Exercise at the Disaster Countermeasure Office

Poster on general instructions at the timeof large-scale earthquake (in Japanese,
English and Chinese)

TopicsRecovery and Lessons Learned from the Nikko Snow Damage
Nikko Works suffered serious damage as a result of record snowfall in the Kanto Region in February this year
(2014), including the collapse of roofing on some factory buildings such as wrought copper products buildings,
and we were forced to suspend operations. We have since made good progress with restoration work and are
gradually recovering normal operations. However, major works are scheduled to continue until the end of theyear, including the reconstruction of buildings, as we work towards a full recovery. (note 1)
Our conventional BCP (business continuity plan) was drafted on the assumption of a major earthquake or similardisaster, and it was not sufficient for handling the recent snow damage. We are extremely regretful about thedisruption we have caused in the supply chain, both to our direct customers and to the customers of ourcustomers. In future, we will improve our awareness of the supply chain and make full use of our recent
experiences in order to promote activities that allow us to minimize any impact on our customers. This
experience has reconfirmed for us the importance of Furukawa Electric products for our customers. We will takethe positives from our experiences by gaining an understanding of specific areas where we can improve andusing this as an opportunity to build an enhanced business continuity management. Moreover, we plan to
combine this new knowledge with the knowledge we have accumulated in our optical semiconductor devices
business, for which we gained ISO22301 certification in February last year, and to promote business continuity
management in other business fields.

33

Furukawa Electric Group Sustainability Report 2014: Web version

Collapsed roofing immediately after thesnow damage

Work continues at the factory with the aim ofachieving a full recovery(note 1) The description of recovery status is based on information as of the end of July 2014.

Information Security
Information security is considered one of the highest-priority risks the Group has to handle. Therefore we
promote various countermeasures through intergroup collaboration by exchanging information among the related
divisions, from the perspectives of protecting information systems and intellectual property as well as information
management. We continue our efforts to prevent information leaks by focusing on the management of hardware(mainly mobile devices) taken outside the office and to manage IT assets through such measures as software
license management. We provide Furukawa Electric Group with educational materials and information on therevisions of information security-related laws such as the Act on the Prohibition of Unauthorized Computer
Access, the Unfair Competition Prevention Act (namely trade secrets) and the Act on the Protection of Personal
Information. In our aim for ongoing improvement, we solicit feedback from divisions promoting these activities.

Protection of Intellectual Property
Furukawa Electric Company undertakes strategic and efficient intellectual property activities by connecting its
business and development strategy.
1.

We generate intellectual property rights strategically based on a patent portfolio management that takes
into account other companies' moves.

2.

We promote risk hedging initiatives by such means as preventing the leakage of technology andsecuring prior use rights.

3.

We promote the diffusion of knowledge on intellectual property and develop group-wide intellectual
property initiatives on a global scale. For example, we offer education related to the creation of intellectual
property and information related to the risks of intellectual property at overseas.

34

Furukawa Electric Group Sustainability Report 2014: Web version

Challenges and Future Policy
Following our international business development, risks that Furukawa Electric Group faces are becoming morediversified and complicated each year. We particularly recognize that risks inherent in overseas operations
mainly in emerging countries and risks from the supply chain standpoint are our top priority issues, and we will bestrengthening our countermeasures against them. As a part of the said efforts, the “Group Global Management
Division” established in October 2013 will be assisting group companies and offering information to contribute to
the improvement of the Group’s global risk management.

35

Furukawa Electric Group Sustainability Report 2014: Web version

Compliance
Basic Approach
Furukawa Electric Group regards compliance as “not only observing laws and regulations, but also as acting inaccordance with the values and ethics required of the company and its employees as responsible members ofsociety”. Accordingly, we promote compliance activities such as internal training based on the Group's CSR
Code of Conduct and monitoring of legal violations. Moreover, each and every employee is encouraged toperform day-to-day compliance activities in line with our three musts for compliance activities: to “be aware”,“speak” and “rectify”.

Three Musts for Compliance Activities

1) Be awareIs this in line with the philosophy and CSR Code of Conduct?
Is this an improper practice?
Does this run counter to society's requirements and expectations?

2) Speak

Do not neglect it.
Talk about it openly.
If still not sure, take it to your boss.

3) Rectify

As soon as you become aware of it, fix it.
Always improve.

Thorough Implementation of ComplianceIn December 2013 and January 2014, the Company received a cease and desist order and a surcharge payment
order from the Japan Fair Trade Commission in connection with cartel behavior on overhead power transmission
line construction. Accordingly, in April and May 2014 the Company was subject to dispositions under theConstruction Business Act by the Ministry of Land, Infrastructure, Transport and Tourism with respect to certain
electric business operations. Furthermore, as a result of an investigation into power cable producers in Japan36

Furukawa Electric Group Sustainability Report 2014: Web version

and other countries launched by the European Commission in January 2009, the European Commission decided
to impose fines on the Company and its equity method affiliated VISCAS Corporation in April 2014. Additionally,
after undergoing an investigation by overseas authorities into its previous involvement in an auto parts cartel, inAugust 2014 the Company was fined by the Chinese authorities for violating China's Anti-Monopoly Law.
The Company would like to express its sincere apologies for the huge concern and inconvenience caused to allaffected parties over several years as a result of its past involvement in cartels.
In the wake of events such as the onsite inspections by the Japan Fair Trade Commission in 2008, Furukawa
Electric Group has sought to eradicate violations of antitrust laws and competition laws, with input from outside
experts. In the future, we will continue to pursue activities to prevent any recurrence, including the enforcementof internal rules on contact with other companies in the same industry and pricing. We will also continue
conducting group-wide activities to improve training for officers and employees at Group companies in Japan andoverseas and to strengthen monitoring by the Internal Auditing Division in response to the recent tightening oflaws and regulations worldwide, not only in respect to compliance with antitrust and competition law but also inother areas of law. Through such initiatives, we will work to foster and maintain compliance and restore trust.

Training and Raising Awareness among Employees
We conduct a host of training and awareness activities in the aim of instilling compliance awareness among all
employees.

Compliance Education
Our primary shared educational materials are the Furukawa Electric Group CSR Code of Conduct and its
corresponding Furukawa Electric Group CSR Compliance Handbook. We distribute this handbook to Furukawa
Electric Group employees and take many opportunities to make use of it. We conduct compliance education for
employees at every level of the Company, from new recruits to directors. At the same time, we hold theme-based
group training and e-learning courses, and conduct groupwide compliance education.

Education Results (fiscal 2014)

Hierarchy-based
education(note 1)

Theme-specificeducation

Course Name

TargetParticipants

Training for executives

Newly apointed executives

32

Training for managers

Newly apointed managers

75

Training for managers andassistant managers

Newly apointed managers
and assistant managers

62

Training for new
employees

New employees

32(note 2)Competition laws and anti-bribery regulations

About 440

Subcontractor Law

About 510

Security trade control

About 1000

(note 1) In hierarchy-based education, manager training and new employee training includes education
on human rights.

(note 2) Figures apply to Furukawa Electric only.

37

Furukawa Electric Group Sustainability Report 2014: Web version

Initiatives in Compliance Months
Furukawa Electric Group has designated October and November as Compliance Months, during which we
implement measures aimed at tackling the variety of compliance issues faced by companies across our Group.
Principal Initiatives during Fiscal 2014 Compliance Months
Main Initiatives at Furukawa Electric
1. Conduct workplace self-checks according to section-specific checklist<Section-Specific Checklist>
1) Anti- Monopoly Act
2) Worker Dispatching Act
3) Subcontracting transactions4) Occupational safety
5) Asset protection6) Information security
2. Conduct workplace meetings
3. Courses on competition laws and anti-bribery regulations
4. Submission of Compliance Pledge (for assistant managers, managers and above)

Employee Compliance Awareness Surveys
We have continued to implement compliance awareness surveys at Furukawa Electric and affiliates in Japan.
Designed to gauge employee awareness and understanding of compliance, these surveys aim to encourage
recognition of compliance. Feedback is given on the results of the survey to our Group companies and Furukawa
Electric divisions, and the results are used to make proposals for compliance measures at each organization.

Internal Reporting System
Furukawa Electric Group has introduced an internal reporting system and works toward the early detection andcorrection of incidents of corruption. The Company has in place an internal reporting desk as well as an externalreporting desk that makes use of outside third-party institutions (the Furukawa Electric Group Hotline), both ofwhich allow employees to make reports anonymously. An internal reporting secretariat manages the content ofsuch reports stringently, taking ample care to prevent people making such reports from suffering any negative
impacts, looking into issues swiftly and taking appropriate action.

Security Trade Control
Furukawa Electric Group considers security trade control to be one of its most important responsibilities as acompany with global business operations. In accordance with the laws and regulations that make up theinternational framework on security trade control (the export control regime), we have improved andstrengthened our management systems for cargoes and technologies that can be converted to weapons or
military uses.
In exporting products and providing technology, we conduct transaction screenings based on our Security Trade
Control Regulations to ensure compliance with relevant legislation and are careful to prevent circumvent tocountries of concern.

38

Furukawa Electric Group Sustainability Report 2014: Web version

In fiscal 2014, we held joint training sessions for priority groups with the aim of increasing understanding of therelevant laws. Approximately 1,000 employees from across the Group took part.

Anti-Bribery
Furukawa Electric Group formulated the Furukawa Electric Group Anti-Bribery Statement in April 2012. In
December, we published the Furukawa Electric Group Anti-Bribery Guide, and we are promoting activities
toward creating a groupwide bribery risk management system. In addition to anti-bribery training carried out at
each company, we have made it possible for all companies to utilize e-learning video and texts for employees as
a Group-wide training tool. What's more, in fiscal 2014 we carried out monitoring in partnership with the Auditing
Department. We will continue to promote anti-bribery measures at Furukawa Electric Group in partnership withthe relevant divisions.

Challenges and Future Policy
We believe there is a need for Furukawa Electric Group to expand the level of participation at Group companies
in the many initiatives the Company has implemented in relation to legal compliance. What's more, we believe it
is necessary for us to put into practice the “three musts” - “be aware”, “speak” and “rectify” - and increase thesensitivity of each and every employee in respect to compliance so that we can flexibly meet the changing
expectations and demands of society and law.
In terms of future activities, we plan to focus on developing effective training content with the entire Group in
mind, and strengthening the global system for promoting compliance. Furthermore, we intend to raise theawareness of compliance even more by encouraging the autonomous behavior of each and every individual
based on the slogan “Thinking about and practicing compliance together”.

39Furukawa Electric Group Sustainability Report 2014: Web version

Targets and Results
Risk Management / Internal Controls / Compliance[Achievement]

Achieved

FY2014
Targets

Continue complianceeducation

Continue hierarchy-based andtheme-specific group training

Results / Achievement
We held theme-based joint training
sessions at five bases in Japan,
covering competition laws andanti-bribery regulations.
We held compliance training by job
grade, including training for
newly-appointed management
candidates and manager training.

We held risk management seminars inStrengthen emerging market
the Southeast Asia Region and China
risk checks and support for
Region.
overseas subsidiaries

We established the Group Global
Management Division andstrengthened support for subsidiaries.
We continued training related toEnhance global compliance competition law, and anti-bribery
foundations
compliance through e-learning.
Ensure thorough compliance withcompetition laws and createanti-bribery systems

Not achieved

FY2015

We carried out a reappraisal ofStrengthen business
important business after switching tocontinuity management
the business division system, and(BCM)
strengthened BCM activities with anStrengthen relations with businessawareness of the supply chain.
partners in regard to BCM activities
We formulated business continuity
Continue BCM drills, andplans (BCPs) for all business divisions
strengthen review activities
and moved on to BCM activities.

Hold risk management seminars inSoutheast Asia and China

Partially achieved

In partnership with the Auditing
Department, we carried out monitoringof efforts to build systems to prevent
bribery.

40

Targets

Promotion of global compliance
Develop training content targeting thewhole group, etc.
Strengthen business continuity
management (BCM)
Based on the lessons learned from the
Nikko snow damage, switch from existing
BCM activities, which focus on our own
company, to activities that focus on thecustomer's perspective.
Respond to risks in newly-emerging
economies and strengthen support foroverseas subsidiaries
Strengthen training in countries with
newly-emerging economies and provide
management support tools to affiliatedcompanies.
Give direction to priority fields in CSR
activities
Hold stakeholder communication

Furukawa Electric Group Sustainability Report 2014: Web version

Environment[Achievement]

Achieved

FY2014
Targets

Partially achieved

Not achieved

FY2015Results / Achievement

Implement initiatives aimed atpromoting effective utilization ofwater (new)

We identified the volume of water
usage for each water source and have
set reduction targets with the aim ofusing water effectively.

Take part in activities conservationof biodiversity (new)We took part in local activities in areas
around our sites and domestic groupcompanies (river basin cleaning
activities, etc.).

Promote development at groupcompanies in Japan (priority) →Expand to domestic groupcompanies, and activate green
activities

At domestic group companies, we
expanded green procurement activities
for general-purpose products andcarried out LCA for our main products.

Targets
Take initiatives aimed at reducing theoverall volume of waste (new)Expand to overseas group companies,
and promote environmental activities(new)
Strengthen activities aimed at promoting
environmental management (priority)
Establish targets under the basic policyon environmental activities and carry out
environmental activities continuously: I.
Social contributions; II. Pollution
prevention; III. Saving energy andresources

Quality[Achievement]

Achieved

FY2014
Targets

Strengthening fundamental“quality power”
Zero complaint from customers of
3H products(note) 3H products:
Hajimete (first manufactured
products)
Henkou (modification of producing
method, process or design, etc.)
Hisashiburi (products not
manufactured for an extended periodof time)Partially achieved

Not achieved

FY2015Results / Achievement

We carried out audit of Strategic
Business Units and promoted thehorizontal penetration of good
examples as part of our activities in our
first year of aiming to achieve zerocomplaints from customers of 3H
products.
Based on the above results, wereleased guidelines for the
management of 3H products.

41

Targets

Strengthening fundamental“quality power”

Decreasing 10% “Failure cost” comparewith FY2014

Furukawa Electric Group Sustainability Report 2014: Web version

Procurement

Targets[Achievement]
Achieved
FY2014
Results / Achievement

Strengthen strategic
relationships with business
We carried out partner
partners
assessments and gave feedback
Continue to conduct
meetings to approximately 300 ofpartner assessments andour suppliers.
feedback consultations

We carried out
Notify businessquestionnaire surveys ofpartners of CSR Deployment approximately 300 of our largest
Guidelines for Businesssuppliers in relation to CSR
Partners with updated version Deployment Guidelines and BCP
describing response to conflict status.
mineralsPartially achieved
Not achieved
FY2015
Targets
Strengthen strategic
relationships with partners(suppliers)
Continue to conduct
partner assessments
Promote awareness of
CSR Deployment Guidelines
among suppliers
Examine specific measures
aimed at strengthening the supply
chain based on the results of BCP
surveys carried out at suppliers
Carry out conflict minerals
survey (survey for the purposes of
updating data)

Personnel Development and Working Environment[Achievement]

Achieved

FY2014
Targets

Results / Achievement

designed training programs inaccordance with the plan.

CWe completed formulation of a plan tostrengthen Genba-ryoku capabilities forStrengthening Monozukuri
all business divisions.
capabilities
The attendance rate for Genbaryoku
Visualization of plans to strengthen
training at Furukawa Electric Co., Ltd.
Genba-ryoku capabilities
was 56.5%, which met our target.
Roll out genba-ryoku reinforcement
Staff training was completed astraining to manufacturing staff
planned for junior and middle-ranking
Increase training participation rate
staff.
at Group companies
Genba-ryoku training for affiliatedcompanies started at FEIC Kyushu(note 2)

Supporting diverse ways ofworking and work-lifebalance
Formally introduce system offlextime without core hours

Not achieved

FY2015

Fostering and strengthening
global human resources
We carried out GDP training and newly
Implementation of Global
Development Program (GDP)
Conduct newly designed training

Partially achieved

We completed introduction of thecoreless flextime system.

(note 2) FEIC: Furukawa Electric Industrial Cable Co., Ltd.

42

Targets
Fostering and strengthening global
human resources
Implementation of GDP
Execution of Global Challenge Program(GCP) for dispatching junior employees
overseas
Strengthening Monozukuri capabilities
Visualization of plans to strengthen
Genba-ryoku capabilities
Development of training for Monozukuri
staff
Development of Genba-ryoku training ataffiliated companies
Supporting diverse ways of working andwork-life balance
Introduction of system to allow nursing
leave to be taken in half-day units.
Introduction of system to allow
accumulated leave to be taken in
half-day units for the purposes of nursing
childrenFurukawa Electric Group Sustainability Report 2014: Web version

Occupational Health and Safety[Achievement]

Achieved

FY2014
Targets
Reduce number of accidents
requiring leave to one or fewer

Partially achieved

Not achieved

FY2015Results / Achievement

Three accidents requiring leave

Targets
Reduce accidents requiring leave to one
or fewer

Social Contribution[Achievement]

Achieved

FY2014
Targets

Invigorate social
contribution activities

Introduce activity case studies andcontinue to provide information

Partially achieved

Not achieved

FY2015Results / Achievement

We introduced case studies andprovided information via the intranet
and website.
We recognized Furukawa Electricgroup companies' social contribution
activities by presenting the CSRAwards.

43

Targets

Implement new programs that can beutilized on a continuous basis.

Furukawa Electric Group Sustainability Report 2014: Web version

Initiatives for the Environment
Environmental Management
Furukawa Electric Group Basic Environmental Policy
Basic Philosophy
We, the employees of the Furukawa Electric Group, recognize that conservation of the global
environment is a serious issue confronting the international community, and we pledge tocontribute to a sustainable future for the world through technological innovation that utilizes
our strength in advanced materials.

Action Guidelines
1.

We shall comply with environmental laws and regulations as well as the demands of our customers andothers, setting ever higher environmental targets as we continuously improve our global environmental
conservation efforts.

2.

We shall strive to develop products that are friendly to the Earth, and create new environmental
businesses.

3.

We shall strive to reduce environmental risk by incorporating anti-climate change and resource
conservation/recycling considerations, as well as a reduction in the use of environmental impact-causing
substances, across the entire product lifecycle.

4.

We shall evaluate the ecological impact of all of our businesses, and strive for the conservation of
biodiversity and sustainable use of resources.

5.

We will seek harmony with the natural environment and local communities through dialogue with our
stakeholders.

Environmental Management
Environmental Management Organization
In April 2013, we underwent organizational restructuring, transitioning to a strategic business unit system. We
also renamed our highest-level advisory body related to environmental management the Furukawa ElectricGroup Environment Committee and promoted environmental management under a new structure. We
established the new Council of Environmental Managers to facilitate smooth decision making on environmental
management and consolidated the special committees that have performed these functions in past.

44

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental management promotion organization

Message from the General Managers
Since FY2014, we have carried out a reconstruction of our management systemwith a view to environmental conservation activities on a global scale, in
response to our Group Management Policy. The basic policy for environmental
activities has been set out in a clear order as follows: I. Social contributions; II.
Pollution prevention; III. Saving energy and resources. Firstly, as amanufacturer it is our social responsibility to make sure that our customers canuse our products and services with safety and peace of mind. We also need tocarry out business activities that allow society to use our products and services
in way that contributes to the conservation of the global environment (designand development → procurement and production → supply and recovery). Secondly, as we develop products
and carry out production activities, we need to manage chemical and other substances in an appropriate way,
and work hard to prevent pollution. Thirdly, by manufacturing in a way that makes efficient use of limited
resources and energy, we need to leave a beautiful natural environment to future generations and carry out
environmental management activities that allow us to contribute to the realization of a rich society.

Hisashi Iwama
General Manager, Safety & Environment Promotion Department, Production Technology Division

Scope of the environmental management
The Group companies' scope of the environmental management includes 33 domestic affiliated companies and61 overseas affiliated companies. Since the environmental impact of the former Furukawa-Sky Aluminum Corp.
used to account for about half of that of the domestic affiliates, and it was excluded from the scope of theenvironmental management in fiscal 2014, we amended the past figures retroactively.

45

Furukawa Electric Group Sustainability Report 2014: Web version

33 affiliated companies in Japan
1.

Access Cable Company

18.

Furukawa Electric Ecotec Co., Ltd.

2.

NTEC Ltd.

19.

Furukawa Electric Industrial Cable Co., Ltd.

3.

FCM Co., Ltd.

20.

Furukawa Electric Power Systems Co., Ltd.

4.

Okano Electric Wire Co., Ltd.

21.

The Furukawa Battery Co., Ltd.

5.

Okumura Metals Co., Ltd.

22.

Furukawa Logistics Corp.

6.

KANZACC Corp.

23.

Furukawa Magnet Wire Co., Ltd.

7.

Shodensha Co., Ltd.

24.

Furukawa Life Service Inc.

8.

Seiwa Giken Inc.

25.

Miharu Communications Inc.

9.

TOTOKU Electric Co, Ltd.

26.

Riken Electric Wire Co., Ltd.

10.

FITEC Corporation

27.

Furukawa Network Solution Corp.

11.

Furukawa Automotive Systems Inc.

28.

12.

Furukawa Sangyo Kaisha, Ltd.

13.

Furukawa C&B Co., Ltd.

29.

Furukawa New Leaf Co., Ltd.

14.

Furukawa Industrial Plastics Co., Ltd.

30.

The Foam Kasei Co., Ltd.

15.

Furukawa Precision Engineering Co., Ltd.

31.

Furukawa Nikko Power Generation Inc.

16.

Furukawa Techno Material Co., Ltd.

32.

Furukawa Elecom Co., Ltd.

17.

Furukawa Electric Advanced Engineering Co.,

33.

Myojodenki Co., Ltd.

The Furukawa Finance and BusinessSupport Co., Ltd.

Ltd.

46

Furukawa Electric Group Sustainability Report 2014: Web version

61 Overseas affiliated companies
1.

SHENYANG FURUKAWA CABLE CO., LTD

2.

Suzhou Furukawa Power Optic Cable Co.,32.

FURUKAWA AUTOMOTIVE SYSTEMSVIETNAM INC.

Ltd.

33.

Furukawa Electric Autoparts (Philippines) Inc.

34.

Permintex Furukawa Autoparts Malaysia Sdn.

3.

P.T.Tembaga Mulia Semanan

4.

Trocellen GmbH

5.

POLIFOAM MUANYAGFELDOLGOZO KFT

6.

Trocellen Italia Holding S.r.l.

7.

Trocellen Italy S.p.A.

36.

Furukawa Automotive Parts (Vietnam) Inc.

8.

Trocellen S.E.A. Sdn Bhd

37.

FURUKAWA AUTOMOTIVE PARTS (DONG

9.

Furukawa Industrial S.A. Produtos Eletricos

10.

Furukawa Industrial S.A. Sucursal Argentina

38.

Furukawa Auto Parts (Huizhou) Ltd.

11.

Furukawa Cabos e Acessorios Ltda.

39.

Furukawa Mexico S.A. De C.V.

12.

OFS FITEL, LLC

40.

TIANJIN JIN HE ELECTRIC ENGINEERING13.

OFS Fitel Denmark Aps

14.

OFS Fitel Deutschland GmbH

15.

Thai Fiber Optics Co., Ltd.

16.

Bangkok Telecom Co., Ltd.

17.

P.T. Furukawa Optical Solutions Indonesia

18.

Furukawa FITEL (Thailand) Co., Ltd.

43.

Furukawa Precision (Thailand) Co., Ltd.

19.

Furukawa Fitel Optical Products (Shanghai)

44.

Xin Furukawa Metal (Wuxi) Co., Ltd.

45.

Furukawa Metal (Thailand) Public Co., Ltd.

46.

Shanghai Sunshine Copper Products Co.,

Bhd.
35.
s.r.o

GUAN) LTD.

CO., LTD
41.
42.

Furukawa Automotive Systems Lima
Philippines, Inc.

DONGGUAN FURUKAWA TOTOKU OPT
ELECTRONICS CO., LTD.

21.

Furukawa Automotive Systems Kabinburi(Thailand) Co., Ltd.

Co., LTD.
20.

Furukawa Electric Autoparts Central Europe,Ltd.

FURUKAWA TOTOKU (HONG KONG)

47.

SHANGHAI KORYU METALS CO., LTD.

48.

Okumura Metals Malaysia Sdn. Bhd.

Thai Furukawa Unicomm Engineering Co.,

49.

GUANGZHOU AUTOM AIRCONDITIONER

23.

FE Magnet Wire (Malaysia) Sdn. Bhd.

50.

OKUMURA METALS THAILAND CO., LTD.

24.

Taiwan Furukawa Electric Co., Ltd.

51.

Furukawa Electric Copper Foil Taiwan Co.,

25.

FURUKAWA AVC ELECTRONICS

LIMITED
22.
Ltd.

PARTS CO., LTD.

Ltd.

(SUZHOU) CO., LTD.
26.

Furukawa Automotive Systems (Thailand)Co., Ltd

27.

Furukawa Wiring Systems Mexico S.A. De
C.V.

52.

Furukawa Circuit Foil Taiwan Corporation

53.

Furukawa Management Shanghai, Ltd.

54.

Furukawa Thai Holdings Co., Ltd.

55.

Furukawa Electric Institute of Technology Ltd.

56.

SuperPower Inc.

28.

Minda Furukawa Electric Private Ltd.

57.

Furukawa Electric Europe Limited

29.

P.T. Furukawa Permintex Autoparts Indonesia

58.

Furukawa Electric Singapore Pte. Ltd.

30.

Furukawa Electric (Shenzhen) Co., Ltd.

59.

FURUKAWA SHIANHAI, LTD.

Changchun Furukawa Automobil Harness

60.

Furukawa (Thailand) Co., Ltd.

61.

Furukawa Electric Hong Kong Limited

31.

Co., Ltd.

47

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric and the Group's domestic affiliated companies engaged in the production activities acquired
ISO14001 certification pertaining to environmental management. We are also working to establish anenvironmental management structure that meets the requirement of ISO 14001, etc., at overseas, and about
70% of overseas affiliated companies acquired the said certification.

TopicsAcquired the highest rating “A” in the Environmental Responsibility Rating of the Development
Bank of Japan.
Furukawa Electric acquired the highest rating of “A” in the Environmental
Responsibility Rating operated by the Development Bank of Japan. The Company was
highly evaluated particularly for its establishment of a global system and developmentof environmentally friendly products. The Company had also acquired the same ratingin 2006, and it was the first company in the electric wire and cable industry to be
assigned the highest rating.

Environmental Education
Environmental Education System and Environmental Education Programs
Furukawa Electric Group conducts various types of environmental education to cultivate among employees
the understanding that is necessary to conduct environmental activities and raise their environmental
consciousness. In fiscal 2014, 52 employees attended our ISO 14001 Internal Environmental Auditor
Course, 12 attended our FGMS(note 1) Auditor Course.
(note 1) Furukawa branding Green products Management System

48

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental education programs

Environmental Awards System
To ramp up our awareness of environmental issues and our environmental activities, in fiscal 2011 we introduced
an environmental awards system. We established three award categories for Furukawa Electric (parent
company), which are namely, “Expanding Sales of Environmentally Friendly Products,” “Global Warming
Prevention Activities,” and “Group Activities.” Concerning the Group's affiliated companies, we grant an award to
those which demonstrated an excellent performance based on a comprehensive evaluation of theirenvironmental activities.

Environmental Accounting
Furukawa Electric Group has introduced environmental accounting to gain a quantitative understanding of costs
and conduct its environmental activities efficiently and effectively.
All data is compiled in accordance with the Environmental Accounting Guidelines (2005 edition) published by the
Ministry of the Environment.
Data on affiliated companies is compiled for 18 companies in Japan.

49

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental conservation costs for the Group during fiscal 2014 came to ¥3.7 billion in expenses, andinvestment amounted to ¥0.6 billion. Compared with the preceding fiscal year, Furukawa Electric reduced its
expenses ¥2.8 billion and reduced investment by ¥0.3 billion.
Owing in part to an increase in electricity rates, energy expenses for the entire Group increased approximately¥1.0 billion.

The Group companies' scope of the environmental accounting
1.

Furukawa Electric Co., Ltd.

11.

Furukawa Industrial Plastics Co., Ltd.

2.

Access Cable Company

12.

Furukawa Techno Material Co., Ltd.

3.

NTEC Ltd.

13.

Furukawa Electric Ecotec Co., Ltd.

4.

Okano Electric Wire Co., Ltd.

14.

Furukawa Electric Industrial Cable Co., Ltd.

5.

Okumura Metals Co., Ltd.

15.

Furukawa Electric Power Systems Co., Ltd.

6.

Shodensha Co., Ltd.

16.

The Furukawa Battery Co., Ltd.

7.

TOTOKU Electric Co, Ltd.

17.

Furukawa Magnet Wire Co., Ltd.

8.

Furukawa Automotive Systems Inc.

18.

Miharu Communications Inc.

9.

Furukawa Sangyo Kaisha, Ltd.

19.

Riken Electric Wire Co., Ltd.

10.

Furukawa C&B Co., Ltd.

Environmental conservation costs (Unit: million yen)
Category

Key activity and the outcome

Furukawa
Electric

Affiliatedcompanies

Total costs

Year on year

Total costs

1,180

-83

404

(1)Business area costs

Pollution prevention (air pollution, etc.),
energy conservation, waste disposal, etc.

(2)Upstream/downstream
costs

Recovery of packaging, drums, etc.

346

-107

234

(3)Administration costs

Environmental management system
auditing, environmental impact monitoring,
etc.

359

15

86

(4)Research anddevelopment costs

Development of environmentally friendly
products, research into alternatives forharmful substances

1,027

55

60

(5)Social activity cost

Tree planting, local community cleaning
activities, donations, etc.

2

-0

5

(6)Environmental remediation
costs

Environmental impact assessments,
cleanup of polluted soil, etc.

1

0

0

2,916

-120

789

Total

50

Furukawa Electric Group Sustainability Report 2014: Web version

Economic benefits associated withenvironmental conservation activities (Unit: million yen)
Total benefit

Details of benefits

Furukawa Electric

Revenue from recycling

303

356

5

-8

-345

-648

-5

-1

-41

-301

Reduction in waste disposal costs
Reduction in energy costs
Reduction in water purchase costs
Total

Affiliated companies(note) Minus figures indicate an increase.
Environmental conservation benefits
Emissions causing environmental impact

Unit

Volume of industrial waste disposal processed(note 2)

Reduction
Furukawa Electric

Affiliated companies

tons

102

-5

Energy consumption (crude oil equivalent)

1,000 kl

12

1

Water consumption

1,000 tons

-1,260

-345

tons

4

-2

CO2 emissions

1,000 tons-CO2

1-10

SOx emissions

tons

15

-0

NOx emissions

tons

-24

117

Soot emissions

tons

-1

24

Emissions of volatile organic chemical compounds(note 2) Excluding recycled wastet(note) Minus figures indicate an increase.
Investment and research costs (Unit: million yen)
Investment and research costs

Total costs
Furukawa Electric

Affiliated companies

259

327

Total investment

4,977

7,250

Total research costs

7,747

2,188

Environment-related investment

51

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental conservation costs (Furukawa Electric)

Economic benefits (Furukawa Electric)

Environment-Related Investment and Expenditures (Furukawa Electric and Affiliated Companies)

52

Furukawa Electric Group Sustainability Report 2014: Web version

Material Flow
Environmental Impact of the Furukawa Electric Group in Fiscal 2014

(note 1) PRTR-listed substances(note 2) Cardboard, wood, plastic, and paper used in product shipping(note 3) OA paper, copy paper, etc. used at plants and offices

53

Furukawa Electric Group Sustainability Report 2014: Web version

Targets and Performance of Environmental Conservation
Activities[Achievement]

Achieved

Partially achieved

Not achieved

Furukawa Electric Group (Japan)
Activities

Activities toprevent global
warmingWaste
reduction
activities

Performance infiscal 2014

Targets for fiscal 2014

Achieve-mentTargets for fiscal 2015

Greenhouse gas
emissions

Reduce by 1% comparedto the previous fiscal year

2.1% increase

Reduce by 2% compared tofiscal 2013

Energyconsumption

Reduce by 6% comparedto fiscal 2008

23.4% reduction

Reduce by 2% compared tofiscal 2013

Specific energy
consumption for
production

Reduce by 1% comparedto the previous fiscal year

Achieved at 12/18
Divisions(Furukawa Electric
only)Reduce by 4% compared tofiscal 2013

Specific energy
consumption fortransportation

Reduce by 7% comparedto fiscal 2007

13.6% reduction(Furukawa Electric
only)Reduce by 2% compared tofiscal 2013

Recycling rate

94% or more

95.0%

-

Ratio of achieving
zero emissions

Ratio of sites achieving
zero emissions: 90% or
more

88.5

Absolute volume of waste
disposal reduced by 2%
from fiscal 2013

Effective use of water

Consider reducing
volume of water
withdrawn

Chemical
substance
management
activities

Reduce by 1% comparedto the previous fiscal year

0.4% reduction

Reduce by 2% compared tofiscal 2013

Expand to Group
companies

18 companies-

Sales ratio forenvironmentally friendly
products: 30% or greater

24.3%

Roll out to Group
companies (conduct of
LCA)

12 companies-

Formulation of
biodiversity guidelines
and creation of structures

Concrete guideline
under deliberation-

VOC emissions
volumeGreen activities

Eco-design activities

Biodiversity conservation-

Participation in regional
biodiversity conservation
activities-

Consumption rate reduced
by 1% from the previous
fiscal year

35% or more-

Participation in regional
biodiversity conservation
activities

We have established common goals of the environmental conservation activities for our overseas affiliates infiscal 2015. They comprise the five items of waste reduction, lower water consumption, abatement ofgreenhouse gas emissions, reduction of energy consumption rate and management of harmful substances.

54

Furukawa Electric Group Sustainability Report 2014: Web version

Activities Targets and Performance in Fiscal 2014
Furukawa Electric Group defines medium-term environmental targets every three years. Each year, we establish
targets for environmental conservation activities based on these plans. We reflect these targets at affiliatedcompanies in Japan and overseas, ensure that targets are consistent throughout the global Group and work
together to achieve them.
With regards to the greenhouse gas emissions in activities to prevent global warming, the Group could notachieve the goal as a whole due to a worsened emission factor caused by the accident at the nuclear power
generation plant after the Great East Japan Earthquake. However, Furukawa Electric on a non-consolidated
basis met its energy consumption targets, as did affiliated companies.

Activity Targets in Fiscal 2015
For fiscal 2015, we added two new goals of absolute waste volume reduction and lowering water consumption
unit. In addition, we reset the standard year to fiscal 2013 which is closer to the present, and the entire Group will
strive to carry out the action plans thoroughly to achieve the goals.

55

Furukawa Electric Group Sustainability Report 2014: Web version

Environmentally Friendly Products
Environmentally Friendly Products and the e-Friendly Accreditation System
Furukawa Electric Group certifies and registers as environmentally friendly
products those products with improved performance compared to existingproducts in the categories of materials and parts purchasing and manufacture,use, distribution and disposal.
We have created the “e-Friendly” environmental mark to identify such environmentally friendly products. This
mark is placed on those products,

Application and Registration of Environmentally Friendly Products
The criteria for an environmentally friendly product are met
when it offers an overall improvement from an environmental
standpoint when compared with existing products and basedon predetermined standards at each stage, from thepurchasing of raw materials and components, manufacturing
and use to distribution and disposal.
Following application and screening by the business division,
products that pass the screening conducted by the Committee
for Development of Environmentally Friendly Products, across-functional organization of the Group, are registered asenvironmentally friendly products.

56

Furukawa Electric Group Sustainability Report 2014: Web version

Categories of Environmentally Friendly Products
The Group's environmentally friendly products belong to one of four categories described below.

Environmentally friendly product categories
Category

Content

Prevention of global
warming

Products with functions that help in the reduction of emissions as well as the absorption andstabilizing of greenhouse gases

Zero emission

Products made from recycled materials, products designed with easyto-recycle components,
products made from materials or with design facilitating volume reduction for lowering waste volume,
products designed to share common components with other products or products designed ascommon components.

Elimination ofmaterials that havean impact on theenvironment

Products that do not lead to an increase in the use of ozone-depletive substances during the
manufacturing process, do not contain harmful substances above regulatory limits and do not
generate harmful substances above these limits during use or disposal.

Resource savings

Products that result in overall energy savings by such means as reducing the use of raw materials
and components as well as scarce resources, featuring enhanced longevity, allowing easier productand component maintenance, and reducing the use for resources in packaging.

Expanding Environmentally Friendly Products
We are working to increase our overall percentage of environmentally friendly products. We set targets based on
percentage of sales, and confirm our progress and success on this basis.

Environmentally friendly products as a percentage of sales

57

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental Performance Indicator “Visualization”
As a part of initiatives to visualize environmental performance indices, the Group promotes the visualization of
CO2 emissions using life cycle assessment (LCA).
Based on the consumption unit of CO2 emissions established for each product by fiscal 2013, we have set atarget to spread the initiative to the affiliated companies in fiscal 2014 and conducted an LCA calculation of major
products at 12 of the 21 subject companies. We also deploy the results of these calculations toward thedevelopment of the Greenhouse Gas (GHG) Protocol (note 1), as well as technical materials and sales promotion
pamphlets, aiming to make use of this information for R&D on future environmentally friendly products.
(note 1) GHG Protocol: An international guidelines for the method of calculating corporate greenhouse gas emissions

Initiatives to Reduce CO2 Emissions from Products during Use
Based on its track record in environmental performance indexing, we are working to visualize the reduction of
CO2 which is emitted when our products are at the stage of being used. According to the estimate for fiscal 2014,
total emission volume in the domestic market of our mainstay products, copper foil, rectangular magnet wire andsemiconductor laser, amounted to 40,000 tons - CO2/year. Going forward, we will try to expand sales of eachproduct category and increase the number of contributing products, so that we can develop our activities totackle environmental issues through our products.

Reduction of CO2 emissions through copper foil for electric car batteries
Copper foil for electrode material of lithium-ion batteries

58

Furukawa Electric Group Sustainability Report 2014: Web version

CO2 reduction of semiconductor lasers
Narrow-bandwidth-FBT (tunable wavelength laser)

CO2 reduction of enameled extruded rectangular wire
Rectangular wire for HV motors

59Furukawa Electric Group Sustainability Report 2014: Web version

Preventing Global Warming
Reducing CO2 Emissions
Initiatives at Works
The majority of the Group's greenhouse gas emissions consist of CO2 generated from electricity, fuel and otherenergy sources. As emissions from manufacturing processes account for a large proportion, we work on
reducing emissions by increasing the efficiency of production processes, switching fuels, replacing equipmentwith more efficient alternatives, insulating hot areas and other measures.
Total CO2 emissions of the Group companies in Japan for fiscal 2014 came to 413,000 tons - CO2/year, down
only by 6% compared to fiscal 2001. We will continue with our efforts to reduce CO2 emissions in the future.

CO2 emissions

CO2 emissions (fuel/electricity)(note) The amount of power consumed is calculated using the emission factor of each power company.
(note) Assuming that hydroelectric power produces zero CO2 emissions.
(note) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.

Energy consumption(note) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.

60

Furukawa Electric Group Sustainability Report 2014: Web version

Initiatives in Logistics
In fiscal 2014, total transportation volume for Furukawa Electric Group amounted to 237 million ton-kilometers,
up 5.6% from the figure in fiscal 2013. Of this total, Furukawa Electric alone accounted for 137 million
ton-kilometers, up 1.9% from fiscal 2013. As a result, CO2emissions increased 5.5% to 15,300 tons CO2 compared to fiscal 2013. The consumption unit was reduced by 13.6% from fiscal 2007, but it grew 3.7%
compared to the most recent fiscal year, fiscal 2013. We will continue with initiatives to promote modal shift,increase loading rates and encourage joint shipping.

Modal shift(note 1) and specificconsumption (Furukawa Electric)

CO2 emissions related to transportation(Furukawa Electric)(note 1) Modal shift rate: Percentage of total transportation that uses rail- or ship-based transportation.

61

Furukawa Electric Group Sustainability Report 2014: Web version

Reducing Waste
Waste Reduction Initiatives
Furukawa Electric Group began taking action to reduce non-recyclable waste in 1993. Since fiscal 2002, we haveconducted zero-emissions activities, defined as reducing the volume of direct landfill disposal to less than 1% of
the total volume of industrial waste emitted.
As a result of our efforts to meticulously sort and recycle waste into useful resources, the total amount of
non-recyclable waste for the Group in Japan amounted to 2,186 tons in fiscal 2014, down 77% compared withfiscal 2005. In addition, the volume of direct landfill disposal of the Group companies in Japan amounted to 442
tons, down 82% from fiscal 2005.
Also, the recycling ratio (ratio of recycled volume to total waste volume) reached 95% (98.5% at affiliatedcompanies and 98.4% at parent company) and exceeded the target of 94% in fiscal 2014.
Processing volume of non-recyclable
waste

Direct landfill disposal(note) UACJ Corporation was transferred to other related companies in fiscal 2014 and so the figures for past fiscal years
have been retroactively adjusted.
(note) Beginning from fiscal 2014, Foam Kasei Co., Ltd., Furukawa Nikko Power Generation Inc. and Furukawa Life Service
Inc. have been added.

Waste disposal costs (Furukawa Electric)

62

Furukawa Electric Group Sustainability Report 2014: Web version

Water Resources
Effective utilization of water
Furukawa Electric Group has been making efforts to utilize water effectively since fiscal 2014 by grasping theamount of water intake and wastewater and setting a consumption unit reduction target for fiscal 2015.
Furthermore, we endeavor to save and recycle water while managing the water quality and volume ofwastewater.
Toward the goal of effective use of water, we will be considering initiatives to slash the water consumption in
every manufacturing process.

In fiscal 2014, we grasped the consumption unit of water intake and wastewater at each operating unit over the
past three years.
Consumption unit of water intake and wastewater

63

Furukawa Electric Group Sustainability Report 2014: Web version

Chemical Substance Management
Green Activities
Response to Customer Requests
When Furukawa Electric Group receives a request from a customer for information concerning chemical
substances in our products, it conducts a thorough environmental examination. We also monitor trends in laws
and regulations covering the chemical substances contained in products and compile and update data as it
becomes available, allowing us to respond promptly to customer requests. Furthermore, by collecting informationfrom industrial organizations and conducting seminars, as well as participating in research groups, we canmonitor environmental regulations and standards and social issues/items of concern. This enables us toincorporate customer needs in our environmental conservation targets.

Response to overseas regulations and management of chemical substances contained in
products
Furukawa Electric Group establishes a management system for chemical substances contained in products for
major operational bases and affiliated companies, strengthens the environmental product regulations and grasps
the environmental risk that should be lowered, and implements measures depending on their importance. Eachtime a new SVHC (Substance of Very High Concern)(note 1) is added to the candidate list of an environmental
product regulation named the EU REACH regulation, we investigate the status of its usage. In fiscal 2014, we
conducted an investigation covering up to 144 substances included in the 10th SVHC in the REACH regulation.
(note 1) Substance of Very High Concern :Use or marketing of SVHCs requires approval, and manufacturers are liable to submit notification if an SVHC exceeds 0.1%
weight content.

Expansion of Green Procurement (General-Purpose Products) to Group Companies
Furukawa Electric encourage the purchasing of OA equipment, office supplies and other items that conform to
the Green Purchasing Law. In an effort to spread these activities within the Group, 18 affiliated companies
designated conforming items in fiscal 2014 and purchased them. Also, items that will be used in our products arepurchased adequately based on the Green Procurement Guidelines of our operational division, by evaluating the
suppliers' system on the management of chemical substances contained in products and its management status
as well as by confirming the data of chemical substances contained in products.

64Furukawa Electric Group Sustainability Report 2014: Web version

Chemical Substance Management Activities
Furukawa Electric Group undertakes voluntary initiatives to reduce emissions of harmful chemical substances. In
particular, we make every effort to actively reduce emissions of volatile organic compounds (VOC), one cause ofphotochemical smog. In fiscal 2014, we managed to reduce emissions of VOC compared to the previous fiscal
year, although the reduction rate of 0.4% came below our year-on-year reduction target of 1%.
Emissions of volatile organic compounds (Furukawa Electric)(note) Volatile organic compounds are the 118 substances specified by The Japanese Electric Wire & Cable Makers'
Association (January 2012 edition).

Appropriate Management of Chemical Substances
At Furukawa Electric Group, we confirm the properties and applicable laws and regulations regarding all
chemical substances we use during the manufacturing process on their Safety Data Sheets (SDSs) andadministrate them. We also monitor the usage volume of chemical substances listed in the PRTR Law(note 2).
(note 2) Law Concerning Reporting, Etc. of Releases to the Environment of Specific Chemical Substances and Promoting
Improvements in Their Management

65

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric Group (Japan)(Unit: Tons)

Substance
No.

Substance

VolumehandledVolumereleased

Volumetransferred

Volumecontained in
products/
disappeared by
combustion

6.6

0.1

0.7

5.8

381.0

0.0

7.9

373.1

1

Zinc and its compounds

31

Antimony and its compounds

53

Ethylbenzene

6.9

0.3

0.3

6.3

71

Ferric chlorides

42.5

3.7

17.7

21.1

75

Cadmium and its compounds

91.5

0.0

0.0

91.5

80

Xylene

23.9

3.4

3.7

16.8

82

Silver and its water-soluble compounds

21.4

0.0

0.0

21.4

86

Cresol

173.4

0.2

8.4

164.8

87

Chromium and trivalent chromium compounds

12.1

0.0

0.1

12.0

88

Hexavalent chromium compounds

5.1

0.0

4.0

1.1

132

Cobalt and its compounds

3.3

0.0

0.1

3.2

144

Inorganic cyanide compounds (Excluding complex
salt and cyanate)

14.9

0.0

1.8

13.1

213

N,N-dimethylacetamide

231.8

0.1

11.6

220.0

232

N,N-dimethylformamide

25.2

0.1

1.3

23.8

239

Organotin compound

1.0

0.0

0.0

1.0

255

Decabromodiphenyl ether

272

Copper salts (water-soluble)

296

333.2

0.0

15.4

317.7

14,304.20

0.3

46.4

14,257.50

1,2,4-trimethylbenzene

24.0

0.1

0.5

23.4

297

1,3,5-trimethylbenzene

1.6

0.2

0.1

1.3

300

Toluene

303.9

190.4

44.3

69.3

304

Lead

8,617.4

0.1

0.3

8,617.0305

Lead compounds

26,564.20.1

2.0

26,562.2

308

Nickel

571.0

0.0

0.5

570.5

309

Nickel compounds

81.7

0.0

11.0

70.6

332

Arsenic and its inorganic compounds

14.0

0.0

0.0

13.9

333

Hydrazine

8.1

0.0

0.0

8.1

349

Phenol

127.6

0.1

6.2

121.3

355

Bis (2-ethylhexyl) phthalate

343.6

0.0

0.2

343.5

374

Hydrogen fluoride and its water-soluble compounds

5.1

0.0

3.2

1.8

384

N-propyl bromide

2.6

2.6

0.0

0.0

392

N-hexane

1.4

0.4

0.4

0.6

405

Boron and its compounds

4.2

1.3

0.7

2.2

412

Manganese and its compounds

7.5

0.0

0.0

7.5

413

Phthalic anhydride

2.0

0.0

0.1

1.9

438

Methylnaphthalene

69.2

0.4

0.0

68.9

453

Molybdenum and its compounds

2.8

0.0

0.4

2.4

52,429.8

204.0

189.2

52,036.7

Total(note) This list is target for substances with a transaction volume of 1 tons or more (0.5 tons or more for Class 1 DesignatedChemical Substances) for the entire Group.

66

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric(Unit: Tons)
Substance
No.

Substance

VolumehandledVolumereleased

Volumetransferred

Volumecontained in
products/
disappeared by
combustion

6.6

0.1

0.7

5.8

1

Zinc and its compounds

31

Antimony and its compounds

127.0

0.0

7.8

119.3

71

Ferric chlorides

13.1

3.7

0.3

9.1

80

Xylene

9.9

2.4

3.2

4.3

82

Silver and its water-soluble compounds

18.5

0.0

0.0

18.5

88

Hexavalent chromium compounds

5.1

0.0

4.0

1.1

144

Inorganic cyanide compounds(Excluding complex salt and cyanate)

9.4

0.0

0.0

9.4

239

Organotin compound

1.0

0.0

0.0

1.0

255

Decabromodiphenyl ether

236.6

0.0

15.2

221.4

272

Copper salts(water-soluble)(Excluding complex salt)

14,296.1

0.3

42.3

14,253.4

296

1,2,4-trimethylbenzene

24.0

0.1

0.5

23.4

300

Toluene

196.8

84.1

44.2

68.6

305

Lead compounds

1.4

0.0

0.0

1.4

308

Nickel

1.8

0.0

0.0

1.8

309

Nickel compounds

21.6

0.0

1.5

20.1

332

Arsenic and its inorganic compounds

0.5

0.0

0.0

0.5

374

Hydrogen fluoride and its water-soluble compounds

3.2

0.0

3.1

0.0

405

Boron and its compounds

3.0

1.3

0.1

1.7

413

Phthalic anhydride

2.0

0.0

0.1

1.9

438

Methylnaphthalene

63.9

0.3

0.0

63.5

453

Molybdenum and its compounds

2.8

0.0

0.4

2.4

15,044.3

92.3

123.5

14,828.4

Total(note) This list is target for substances with a transaction volume of 1 tons or more (0.5 tons or more for Class 1 DesignatedChemical Substances) by the Company's works.

67

Furukawa Electric Group Sustainability Report 2014: Web version

Environmental Risk Management
Preventing Soil and Groundwater Pollution
Furukawa Electric Group conducts regular inspections of facilities and equipment that handle specific toxic
substances to prevent the pollution of soil and groundwater. We reduce the risk of pollution through measures toprevent leaks of specific toxic substances and underground seepage, as well as through ongoing efforts to switch
to substitute substances.
We began proper disposal of the slag stored in the Oyama area (a plant site of the former Furukawa MagnesiumCo., Ltd.) and conducted soil remediation where underground soil was contaminated. Work on part of thepremises is now complete.

PCB Management
Furukawa Electric Group monitors the amount of high-concentration PCB-containing equipment at each of ourWorks and affiliate company sites, and conducts proper storage and management. Based on the said
information, we have been registered with the Japan Environmental Safety Corporation and started disposing ofthem step by step in accordance with the plan. In addition, the Company conducts analysis on equipment that
may contain a small quantity of PCB substances in order to dispose of them systematically in the future.

PCB amounts contained in equipment As of March 31, 2014
Works

In storage In use

Total

Chiba Works

110

0

110

Nikko Works

286

60

346

Hiratsuka Works

219

8

227

Mie Works

83

10

93

Yokohama Works

19

1

20

Copper Tube Division

34

12

46

Copper Foil Division

16

48

64

Total

767

139

906

Response to Asbestos Concerns
Although Furukawa Electric Group does not currently produce or import any products containing asbestos, someof the industrial-use products we made and sold in the past contained asbestos. These include electrical wiring
for ships, and fire-resistant products for constructing telecommunications and electrical power facilities, etc.
In addition, we are currently examining the buildings and plants of Furukawa Electric and our affiliates todetermine if asbestos-containing building materials have been used. Inspections for asbestos dispersal inbuildings in which spray-on materials had been used have confirmed the presence of asbestos, and removal
work or containment measures have been taken to prevent future dispersal. We have also proceeded to replace
68Furukawa Electric Group Sustainability Report 2014: Web version

equipment and fixtures in which asbestos insulation has been used so as to prevent dispersal, with planned
replacements of all items which are currently not dispersing asbestos with items not containing it. For other items,
we conduct regular inspections and introduce alternates during facility renewals.

Compliance with Environmental Laws and Other Regulations
Furukawa Electric Group regularly confirms environmental laws and other regulations to determine items
requiring compliance. We ensure compliance in a number of ways, such as by conducting on-site patrols tocheck the state of compliance. We follow official journals and other sources of information to stay updated onrevisions to environmental legislation and ensure that our response is thorough.
We maintain voluntary control limits and manage operations appropriately to ensure compliance with the Air
Pollution Control Law and the Water Pollution Control Law.
In fiscal 2014, we continued to conduct an environmental check-up in our domestic affiliated companies byperforming the said check-up at seven operational units of the Company while responding to the revised cleanwater act.
We also conduct annual checks for conceivable, clear environmental impact to prevent environmental accidents
or prevent widespread impact in the event of an accident.
According to our survey on the status of our regulatory compliance, we were not in material violation of any
regulations.

69

Furukawa Electric Group Sustainability Report 2014: Web version

Biodiversity Conservation
Biodiversity Conservation Initiatives
In April 2011, we began providing information on our website about the biodiversity efforts we are conducting aspart of our Basic Environmental Policy. With a view to specifying the Group's biodiversity efforts, we compiled
significant targets in fisical 2014 into the comprehensive guideline of the Furukawa Electric Group concerning
biodiversity. We did this in recognition of the fact that our business, products and services are the result of
biodiversity, and that our operation has an impact, whether positive or negative, on eco-systems.
Also, following a major organizational reform in fiscal 2014, we integrated our biodiversity conservation system
into the Environmental Committee. Going forward, we will be modeling our regional activities centering on land
utilization and procurement under the new structure at each operational unit, in order to spread the activities
horizontally within our Group. We will also be using the “Symbiosis business unit promotion guideline” compiled
by JBIB (note 1), an initiative in which we participate.
(note 1) JBIB : Japan Business Initiative for Biodiversity. Founded in 2008, the JBIB is a joint effort by Japanese companies toact on behalf of biodiversity preservation.

Furukawa Electric Group Biodiversity Conservation Guidelines
1.

Evaluate the effects that our business activities have on the ecosystem, and minimize the harmful effects
while maximizing the beneficial ones

2.

To sustainably use resources and conserve biodiversity, consider more than ever the need to carry out
measures against climate change, conserve resources, recycle and reduce environmentally hazardous
substances

3.

Carry out activities in collaboration with local communities to conserve biodiversity

70

Furukawa Electric Group Sustainability Report 2014: Web version

Initiatives for Society
Relations with Customers
Basic Approach
Each of the Company's divisions has acquired ISO 9001 certification. Through initiatives such as these to
standardize our operations and work consistently to improve quality, we are striving to contribute to society byproviding excellent-quality products and services from a customer perspective.
Going forward, we will continue endeavoring to further enhance “quality power” throughout Furukawa ElectricGroup by developing products that are attractive to our customers, based on a policy of Group-focusedmanagement.

Quality Management Policy
At every stage of our operations, from research and development to manufacturing, sales, customer
service and management, in all sections and all hierarchies, we always strive to adhere to a PDCA
management cycle based on actual facts, maintain and improve our products, customer services and thequality of our operations and put our management policies into practice.

Organizations for Improving Quality
Furukawa Electric has established Furukawa Electric Group Quality Management Committee, which is chairedby the president, as the topmost body for promoting quality management at the Group level. Directed by thiscommittee, Divisional Quality Management Committees led by divisional heads promote ongoing efforts tomaintain or improve the quality of our products, customer services and operations.
Promotion Framework

71Furukawa Electric Group Sustainability Report 2014: Web version

Message from the General Managers
As set out in the basic policy on quality management, we promote amanagement cycle that is always based on facts and seek to maintain andimprove quality at all stages of our work (including research, development,
manufacturing, sales, services and management), at all divisions and across all
job grades.
As we seek to produce products that are attractive to our customers, we carryout thorough checks of all processes prior to delivery to the customer, fromproduct planning through to completion of the final product. Moreover, in orderto improve our ability to complete manufacturing products with meticulous
assurance of quality from the start, we will continue to make improvements to the production process itself,
including attempts to create intrinsic technologies.
Furthermore, we have already started to carry out customer satisfaction surveys at some Strategic Business Unit
and we will examine ways of using customers’ opinions to achieve further improvements.

Kazuhisa Kashihara
General Manager, Quality Promotion Department, Production Technology Division

Activities in Fiscal 2014: Improving Customer Satisfaction
In fiscal 2014 we implemented activities under a policy of strengthening fundamental “Quality Power” to enable
the “materialization of attractive products for customers”. We established the priority target of “zero complaint in
3H products”, but failed to achieve this target.
Complaints were particularly prominent as a result of insufficient risk assessment in the process of switching tomass production in products that were being “manufactured for the first time” or “being changed”. We promoted
corrections by conducting audits through the course of the year, but this was not enough to eliminate theproblems completely.
Overall complaints have fallen and so far we have succeeded in eliminating 94% of complaints compared to 12
years ago.
We have also sought to identify and increase customer satisfaction through daily communication with customers
and by holding customer satisfaction surveys into things such as quality, deadlines and after-service.

72

Furukawa Electric Group Sustainability Report 2014: Web version

Customer complaint ratio (Furukawa Electric)(note) The figures show the percentage of customer complaints, taking fiscal 2002 levels as 100%.

Fiscal 2015 Initiative: Strengthen Fundamental “Quality Power”
In fiscal 2015 we will continue to pursue Furukawa Electric Group Quality
Policy, which calls for the strengthening of fundamental “Quality Power” toenable the “materialization of attractive products for customers”, andimplement the following three measures with the aim of achieving the policy.
Examining ways of strengthening“Quality Power”

Three Measures
Strive to “put quality into our products during the designing process” and “thoroughly complete ourproducts' quality activities during the manufacturing process”
Distribution of various quality information such as customer information, corrective action andimplementation of solutions equally among Furukawa Electric Group

Promote the “visualization of quality within processes” and reduce the failure cost

What's more, in order to continue reducing complaints we have utilized the management guidelines for 3H
products set out based on the results of audits carried out during activities last year.

Ongoing Improvement Activities at Individual Worksites
Furukawa Electric Group conducts bottom-up quality improvement activities, forming its worksite employees intocircles and promoting “QC Circle Activities” that seek to resolve a variety of problems. The results of these
activities are shared at Groupwide competitions held once per year.
In fiscal 2014, Furukawa Electric's Copper Tube Division hosted a QC circle conference and presentations were
given on the activities carried out at 14 circles in Japan and 4 circles overseas. The Gold Award was given to a
Japan-based circle, but three of the top seven places were awarded to overseas circles, showing just how far QC
circle activities have permeated overseas and contributed to improving the quality standards of the Group as awhole.

73

Furukawa Electric Group Sustainability Report 2014: Web version

Presentation by the Gold Award-winning circle

Commemorative photograph taken with all of theparticipants after the QC circle conference

Activities Proposing Solutions to Customers
Furukawa Electric Group is working to strengthen its Group-wide
overseas marketing functions based on a policy of “strengthening
Group Global management”. At the same time, we aim to provide
customers with solutions based on our collective strength as a Group,
and aim to increase levels of customer satisfaction through healthy
communication with our customers.
One example of these measures is the overseas expo we hold every

At the Expo (Sao Paolo, Brazil)

year. Since 2009, the expo has been held in Bangkok, Thailand;
Shenzhen and Shanghai in China; and Jakarta, Indonesia. We have held technology
exhibitions showing the solutions that can be achieved through the combined strengthsof Furukawa Electric Group, and we have continued to carry out proposals in line with
the needs of local customers.
In November 2013, we held the FURUKAWA Innovation Expo 2013 in Sao Paulo,
Brazil. There was huge interest in the Company's varied lineup of telecommunications
products and auto parts that combine the technological strengths of Furukawa ElectricGroup, and we received numerous inquiries about next-generation energy
technologies, such as super-conducting cables.

Keynote speech given by
Chairman Yoshida

We will continue to prioritize communication with our customers and utilize customers' opinions as we go about
improving the quality of our products and services.

74

Furukawa Electric Group Sustainability Report 2014: Web version

Challenges and Future Policy
We failed to achieve “zero complaints in 3H products”, which is one of the priority targets of Furukawa ElectricGroup Quality Policy. We have drafted 3H product management guidelines based on the results of audits carriedout during activities. We plan to utilize these guidelines as we continue promoting efforts to reduce the number ofcomplaints.
At the same time, as we seek to increase the Company's monozukuri capabilities we will continue to pursue
complaint reduction activities during fiscal 2015 and seek to achieve improvements in the manufacturing processitself in ways that incorporate unique technologies so that we can achieve the “meticulous assurance of quality
from the start” and the “ability to complete manufacturing”.

75

Furukawa Electric Group Sustainability Report 2014: Web version

Relations with Business Partners
Optimum Purchasing on a Steady, Ongoing Basis
Furukawa Electric Group procurement policy is to establish strategic relationships with business partners toensure optimum purchasing on a steady, ongoing basis.

Furukawa Electric Group Procurement Policy
We will realize the optimal procurement for Furukawa Electric Group through global partnerships by:
1. establishing strategic trading relationship with suppliers to create stable and sustainable procurement
function.
2. stabilizing procurement of raw materials and parts for our key products.
3. implementing procurement algorithm and procedure according to the NF production system.
4. achieving mid term goals through continuous cost reduction programs and activities.
5. capitalizing on economies of scale for centralized negotiation and on practicality for decentralized
procurement activities.
6. globalizing procurement.
7. engaging in green procurement and enforcing compliance.
Message from the General Managers
Ever since its foundation, Furukawa Electric has stayed in business by
supplying people with social infrastructure and contributing to society as asupplier of products. However, our success is not just the result of hard works at
our company. It is also thanks to the steady delivery by our suppliers of the raw
materials we use to create products.
In the future, our business environment is likely to change even more rapidly.
Under these circumstances, we will need to strengthen our supply chains further
in order to continue contributing to society. We intend to use partners' meetingsand partners’ assessments to improve the mutual understanding we have with our suppliers, and to continue
contributing to society through measures such as the promotion of CSR activities and strengthening of BCP.

Satoshi Tosaka
General Manager, Procurement Department, Finance & Procurement Division76

Furukawa Electric Group Sustainability Report 2014: Web version

Conducting Training on Subcontracting Transactions
In order to forge sound relationships with business partners through fair transactions that comply with rules andregulations, Furukawa Electric Group provides training for employees on subcontracting transactions. In fiscal
2014, in addition to continuing with the courses we have conducted to date, we sought to ensure thoroughawareness of the content of the Act against Delay in Payment of Subcontract Proceeds, Etc., to Subcontractors(Subcontract Law).

Partner Meetings and Partner Evaluation Scheme
Furukawa Electric seeks to deepen awareness among our business
partners through regularly held Partner Meetings, where we explain
the state of the Company, our procurement policy and individualcompany management strategies. For fiscal 2014, this meeting washeld in June and was attended by 85 main business partners.
We also evaluate main business partners on the basis of quality,
technology, price, delivery system, degree of social contribution andfinancial condition, and then hold meetings to provide feedback on

Partner Meeting

our findings. In addition, we discuss the results of our evaluations
with them to more closely align our awareness of procurement activities.
Furthermore, based on the results of these evaluations and lessons learned through our experience of the Great
East Japan Earthquake, we requested ongoing cooperation from certain business partners on business
continuity and stable supply initiatives.
In fiscal 2014, we evaluated some 300 business partners and provided feedback to them.

Promoting CSR through Procurement Activities
Based on our CSR Deployment Guidelines for Business Partners, we work with our business partners on an
ongoing basis on initiatives to ensure that our procurement activities involve thoroughly compliant and fairtransactions and take into account human rights and safety, and consideration for the environment.

Conflict Minerals(note 1)
We have addressed the issue of conflict minerals by formulating a Group policy entitled “The Responsible
Sourcing of Minerals”, which we have distributed to Group companies and business partners to ensure theirawareness.
In fiscal 2014, we carried out an independent survey into the main products of Furukawa Electric Co., Ltd. and its
group companies. Going forward, in addition to requesting the cooperation of Group companies and our77Furukawa Electric Group Sustainability Report 2014: Web version

business partners in the responsible sourcing of minerals, we will work with the Japan Electronics andInformation Industries Association (JEITA), an industry organization, on initiatives targeting the responsible
sourcing of minerals.
(note 1) Defined as minerals (tantalum, tin, gold, tungsten or their derivatives) that originate in or near the Democratic
Republic of the Congo that may help to finance armed conflict.

Challenges and Future Policy
As part of our partner evaluation scheme, we carry out surveys into their level of understanding of our guidelines.
We intend to continue these activities with the aim of identifying and promoting CSR activities. At the same time,
we also carry out surveys into BCP initiatives. We aim to use the results of these surveys to encourage ourbusiness partners’ cooperation in specific activities so that together we can strengthen the BCP system throughthe supply chain as a whole.

78

Furukawa Electric Group Sustainability Report 2014: Web version

Relations with Shareholders
Information Disclosure Policy and IR Framework
Furukawa Electric Group Basic Policy on CSR requires that the Group seeks to improve upon the sound, friendly
relationships we maintain with all of our stakeholders. Our Own Regulations on the Timely Disclosure of
Corporate Information meanwhile set out a framework for the disclosure of appropriate information at theappropriate time.
Based on this policy, all IR activities are conducted by the Investor & Public Relations Department and overseenby the director in charge of IR, who is General Manager of the Finance & Procurement Division.
Message from the General Managers
Furukawa Electric’s business began with copper smelting and the manufactureof electric wires. One hundred and thirty years later, the numerous products that
we manufacture based on our materials technology support the lives of people
around the world in a wide variety of fields, including telecommunications,electric power infrastructure and automobile.
However, because we often work behind the scenes, shareholders andinvestors often tell us that they feel unfamiliar with the content of our business.
We will continue to work hard to host events such as factory tours, in addition to
making regular news releases and developing the website, so that people can clearly understand and feel morefamiliar with our business. Your continued support is greatly appreciated.

Osamu Suzuki
General Manager, Investor & Public Relations Department, Finance & Procurement Division

Relations with Institutional Investors and Securities Analysts
In addition to holding management briefings (covering interim andyear-end results and mid-term plans when announced) for institutional
investors and securities analysts, we actively encourage communication
all year round.

Briefing for institutional investors

79

Furukawa Electric Group Sustainability Report 2014: Web version

Relations with Individual Investors
In October 2013, we held our 6th plant tour for individual investors. Visitors were selected by lottery from among
those who responded to an open invitation, with 88 people invited to attend out of the 853 who responded.
During the tour, we offered participants a number of opportunities to get a feel for Furukawa Electric. We
introduced our production processes for copper products and visited a hydroelectric power station. The tour also
featured a simple explanation on the phenomenon of superconductivity.

Copper rolling plant (A close-up look at the
hot-rolling process)Superconductivity experiment (Explanation including
experience of the phenomenon of superconductivity)

Returning Profits to Shareholders
Furukawa Electric considers the appropriate return of profits to our shareholders to be one of our most important
policies. Our basic policy is to continue making steady dividend payments in consideration of future businessdevelopments and in anticipation of the Company’s future profitability trends and financial status from along-term perspective.
Regarding dividend payments in the fiscal year ended March 31, 2014, in consideration of the need to improve
the financial structure, make growth strategy investments with a focus on the infrastructure and automotive
markets and make investments aimed at developing the next generation of business to build a platform forsustainable growth, the Company decided to award a year-end dividend of ¥3.0 per share. Regarding dividend
payments in the fiscal year ended March 31, 2015, in consideration of the fact that the Company is still in theprocess of recovering its operational performance and improving its financial structure the Company expects toforgo the interim dividend and award a year-end dividend of ¥3.0 per share.

80Furukawa Electric Group Sustainability Report 2014: Web version

Relations with Employees
Personnel Management
Personnel Management Policy
Our basic personnel management policy focuses on continuously creating human resources who are capable ofputting the Five Principles of the Furukawa Electric Group Credo into practice on their own initiative.

THE FURUKAWA ELECTRIC GROUP CREDO
1.

Maintain high ethical standards, and value honesty and integrity above all.

2.

Continually improve, innovate, and lead, in every area of endeavor.

3.

Take a hands-on approach that addresses the reality of every situation - in the office, at the factory, and on
site.

4.

Be proactive - take the initiative and work with others, persevering until a solution is found.

5.

Maintain open channels of communication between departments and divisions, so that we can shareideals and help each other grow.

Basic approach
We believe that a workplace environment that encourages among all employees compliance and consideration
for human rights serves as the foundation upon which employees can maximize their capabilities. On this basis,
we are devising and introducing a personnel system that will harness employees' diverse abilities andpersonalities. This should encourage employee creativity, setting the cornerstone for “continuous technologicalinnovation.”

Challenges and Future Policy
Under the Fiscal 2015 Medium-term Management Plan, we are focusing on fostering “resilient human resources”
capable of succeeding in stiff global competition with the aim of providing strong foundations for the wholegroup's growth in response to major changes in our business environment; at the same time we have set
ourselves the mission of constructing a collaborative environment to allow us to involve our affiliated companies
both in Japan and overseas and to focus on “policies that strengthen top management” and “reforms to ourorganizational culture/ policies to improve human resources policies” as policies that can contribute to theGroup's Global management. Specifically, we will set out a direction for employees to develop their abilities whileat the same time implementing individual policies from the perspectives of “recruitment and allocation”,“assessment”, “remuneration” and “personnel systems”, as well as “skills development” with a focus on
strengthening the cultivation of global human resources.

81

Furukawa Electric Group Sustainability Report 2014: Web version

Principal Measures Pertaining to the Group's Global Management
Measures to Strengthen Top
Management

Measures to Improve the Corporate
Culture and Policies to Improve
Human Resource Measures

1.
2.
1.
2.

Review performance evaluation structures and compensation systems(directors and managers)
Introduce succession plans to create a human resources database andassign personnel strategically,etc.
Formulate and execute a basic policy on skills development and
FM-Career Design (new standards for allocation of human resources)
Develop candidates for overseas postings through measures such as
reviewing training curricula and dispatching junior employees overseas

Message from the General Managers
In order for Furukawa Electric Group to succeed and achieve sustainablegrowth in a rapidly-changing and globally-competitive landscape, it is importantthat we “foster tough human resources” capable of overcoming numerous
challenges and “build a collaborative environment” with a view to enhancing ourcross-organizational strength.
For this reason, we have implemented new initiatives, including FM-Career
Design (a personnel system that encourage individuals with the skills and desire
to take on new challenge by using career-building through systematic
placements and fluidity in human resources in order to promote the revitalization of organizations which canenhance the creation of innovation ideas) and the Global Challenge Program (GCP; a program that aims topromote overseas experience among junior employees).
As we seek to strengthen Group Global management, it is essential that individual employees with diverse waysof thinking, skills and backgrounds exchange honest opinions in a free and open manner, irrespective of traits
such as age, gender or nationality, and that they act with true motivation. Moving forward, by actively promoting
diversity management we intend to accelerate efforts to build an atmosphere and culture that allow diverse
human resources to display their true strengths.

Taizo Matsumura
General Manager, HR & Administration Department, Administration & CSR Division82

Furukawa Electric Group Sustainability Report 2014: Web version

Human Resources Development
Enhancing Educational Programs
We are undertaking initiatives that further management's aim of training human resources suited to steadily
execute Furukawa Electric Group reforms. We have prepared a number of learning opportunities, including
conducting training courses and e-learning and supporting efforts to earn qualifications, in our bid tocultivate sensitive human resources who can think and act for themselves. In this manner, we are working toencourage personal growth and maximize our organizational capabilities, while at the same time promoting amindset that emphasizes Group management.
Educational System Tree (PDF1,064KB)
http://www.furukawa.co.jp/english/csr/social/training.pdf

In rank-based training, we hold workplace discussions and strive to link observations to actions, rather thanconducting one-off training. Our OJT Leader System seeks to go beyond differences in age and rank inpromoting a shared awareness of issues, targeting organizational reform through the practice of operating anorganization and cultivating a sense of cooperation. For middle-ranking leaders, we conduct training designed tohelp them analyze situations logically, identify issues and plan measures to resolve them, as well as honing thesensitivity that leadership requires. By holding joint training camps with the employees of affiliated companies,
we are aiming at Group-wide human resource development.

Training Leaders Suited for the Global Environment
We launched the Global Business Leader Training Program in fiscal 2007 for the training of future management
personnel. More than 100 graduates of this program are currently at important posts in Furukawa Electric and at
our affiliates in Japan and overseas.
In fiscal 2014, we have launched the Global Mindset Program (GMP) to cultivate human resources capable ofoperating on a global stage. This program hones global awareness and an understanding of diversity, as well as
training participants in identifying and resolving issues on their own. We are expanding the program, focusing inparticular on global training for people assigned to overseas positions and in roles that support overseas
operations.
What's more, starting in fiscal 2015 we began operating the Global Challenge Program (GCP), which is a training
program that dispatches junior employees overseas.

83

Furukawa Electric Group Sustainability Report 2014: Web version

Global Human Resources Training System

Moreover, among our training programs for local employees of overseas affiliated companies, in fiscal 2011 webegan conducting the Global Development Program (GDP) in Japan for leaders at overseas companies. The
program aims to deepen their understanding of the Furukawa Electric Group and encourage their interaction withJapanese employees, energizing both groups and cultivating an international sense.

Presentation

Group photo

Strengthening the Genba-Ryoku Project
Since fiscal 2009, Furukawa Electric has been pursuing initiatives to bolster the manufacturing capabilities of its
production sites. These activities focus on cultivating genba-ryoku (worksite capabilities) by encouraging people
at its production sites to think for themselves and act on their own initiative for the good of the customer.
Since fiscal 2010, our works have implemented Chief Operator Training and Mid-level Operator Training in order
to transmit the required knowledge to mid-level staff in the manufacturing workplaces. In fiscal 2011, we
84

Furukawa Electric Group Sustainability Report 2014: Web version

launched the Basic Program, which seeks to promote an improvement in the overall skills and knowledge of ourworkers. Through these training programs, we have sought to increase the motivation towards work of
employees in the manufacturing workplaces under the Genba-Ryoku Enhancement Project, promoted thetransmission of techniques and skills, and sought to revitalize monozukuri capabilities in the workplaces.
What's more, since fiscal 2014 we have held Junior Monozukuri Staff Training for junior technical staff andsought to promote a workplace culture in which the manufacturing workplace and technical staff share thecommon language of seeking to strengthen “genba-ryoku”.

Lecture scene of Mid-level Operator Training

Completion ceremony for Junior Monozukuri
Staff Training

In September 2010, we established the Genba-Ryoku Enhancement Training Center at the Yokohama Works
and we have used the Center for a variety of joint training programs across the Group. Specifically for new
employees (and as part of our training programs for both technical and business employees), we offer
Monozukuri Training, through which trainees work in teams to find solutions to customers' demands. We also
provide Processing Experience, which gives trainees experience of the difficultly of manufacturing, and Risk
Awareness training, which increases recognition of the dangers of the manufacturing workplace.

Monozukuri Training for new employees(Risk Awareness)
Monozukuri Training for new employees(Processing Experience)85

Furukawa Electric Group Sustainability Report 2014: Web version

Furukawa Electric also includes Japan-based affiliated companies in its Genba-Ryoku Training Program. We
have also started to include some overseas affiliated companies in the training. Our group companies areworking together to strengthen monozukuri capabilities in both Japan and overseas.

2S drills at China FAS

Anzen Dojo (safety education) training for employees
at FISA in Brazil

People Undergoing Genba-Ryoku Reinforcement Training

86

Furukawa Electric Group Sustainability Report 2014: Web version

Diversity
Diversity in Hiring
Furukawa Electric is actively recruiting international personnel and international students to support the
globalization of our business.
Furukawa Electric Group has a number of initiatives underway to recruit talented personnel. In addition to
information exchanges to share know-how on hiring within the Group, we hold Furukawa Electric Group Forum
held in Tokyo and Osaka, at which we conduct briefings in conjunction with Group affiliates, and work proactively
demonstrate the appeal of Furukawa Electric Group to students.

Hiring the Disabled
Furukawa Electric established Furukawa Newleaf Co., Ltd. as a special subsidiaryin 2004 to actively employ people with intellectuall disabilities. This is one of ourefforts to increase the percentage of people with disabilities that we employ.
The company handles cleaning operations at the compounds of our works andcurrently employs a total of 37 people with disabilities, 14 at the Hiratsuka Works,
21 at the Chiba Works and 2 at the Mie Works. The company also provides
individualized guidance on everything from matters of daily conduct in thecompany through the building of good human relationships to assist employeeswith intellectuall disabilities in becoming independent members of society.
We also invite parents and guardians of children with no work experience to tour
our work and guidance sites, so as to better understand our efforts involving theemployment of people with disabilities.

Furukawa Newleaf Co., Ltd.,
employees in action

Our employment ratio of people with disabilities was 1.94% in fiscal 2014, which unfortunately failed to meet thestatutory target. However, we are working to increase this employment ratio further by expanding the operationsof our special subsidiary.

87

Furukawa Electric Group Sustainability Report 2014: Web version

Ratio of employees with disabilities (Furukawa Electric)

Internships
Ever since the Japanese government introduced a system of internships in 1997 as part of anindustry-academia-government collaboration, in our role as a manufacturer Furukawa Electric has taken on
numerous science and engineering interns with the aim of contributing to the fostering of Japanesetechnicians of the future. We have already taken on more than 200 students across our various workplaces.
In recent years, we have also actively sought to accept students from overseas universities in addition to
Japanese universities.

Internship training at Nikko Works

Upgrading and Enhancing Workplace Environments
Volunteer Leave System, Refresh Leave System
To support individual employees' efforts to participate in social contribution activities, we have in place a
Volunteer Leave system for people who have been employed for one year or more. When we introduced thissystem in 2011, it was limited to volunteers in support of restoration and reconstruction activities following theGreat East Japan Earthquake. We lifted this restriction in May 2012, expanding its use to uncompensated social
contribution activities. Going forward, we plan to continue supporting employee participation in social contribution
activities.

88Furukawa Electric Group Sustainability Report 2014: Web version

Also, in 2011 we inaugurated a Refresh Leave System whereby employees in their 25th year of employment cantake from 14 through 31 consecutive leave days per year. Taking this sort of leave is designed to help workers
enliven their performance, give them an opportunity to review work we handle as an organization and enhancetheir work-life balance (the balance between work and home life). We also provide a scholarship fund of 300,000
yen, which is limited to employees who have acquired leave, in order to provide financial support to the variety ofactivities they are involved in during their periods of leave.
My Volunteer Activity Report

I volunteered as a race official at the National Sports Festival of Japan at Nikko 2014
Kazuhiro Takashiba
Research & Development Division Metal Research Laboratories

I used Volunteer Leave for five days from January 28, 2014 to act as a speed
skating official at the 69th Winter National Sports Festival Skating Tournament(held in Nikko City, Ibaraki Prefecture).
I was a photo finish judge. For one year before the tournament I attended numerous
tournaments and received instructions from judges across Japan. A race contains amaximum of 12 skaters and the finishing line can be chaotic. It can be very difficult
to make a decision with the naked eye. For this reason, we photograph the moment
the skaters cross the line and record their finishing order and times.
The job doesn’t allow you to relax for a moment, but the more you do it the more
the photographs teach you just how hard the skaters are striving, and I got a true
sense of how exciting the role of an official can be and how wonderful it is whenpeople give their all to what they do.

At a competition

I want to make the most of these experiences to continue playing my own smallrole and volunteering whenever possible.

89

Furukawa Electric Group Sustainability Report 2014: Web version

My Refresh Leave

Refresh Leave at Izumo Shrine, where the kami come to meet!
Tsutomu Saito
Copper Foil Division Technical Support Department

I took Refresh Leave from October 15 to November 15, 2013.
2013 marked a significant year of “Sengu” (shrine renewal) because the “Sengu” of Ise Grand Shrine and Izumo
Grand Shrine coincided, which is something that happens only once every 60 years. I made the most of thisopportunity to visit Izumo Grand Shrine in Shimane Prefecture. October is the month that countless kami are said
to come together and meet in Izumo. Outside Izumo, October is referred to as Kannazuki (the month when thekami have gone away) but in Izumo it is called Kamiarizuki (the month when the kami are present).
I was blessed with clear skies during my trip and I enjoyed visiting historical buildings, listening to the myths from
Izumo, and eating famous local produce.
I also spent time helping my parents visit hospital and watching the films I had wanting to see, and it was a very
useful period of leave for me.

View of the main shrine at Izumo Shrine

Coreless Flextime System
Furukawa Electric operates two types of core-time (during which employees must be in attendance at work) withthe aim of achieving flexible and efficient working practices in accordance with the needs of the workplaceenvironment - standard core-time (10:00 to 15:00) and short core-time (13:00 to 14:00).
In June 2013, “coreless flextime” (in which no core-time is set) was officially added to the existing two types ofcore-time. As a result, more efficient work became possible by allowing employees to avoid work duringcore-time for the purposes of starting up or maintaining equipment during night shifts, carrying out testing that
requires attendance throughout the day and night, and dealing with overseas bases with time differences.
In the future, we intend to continue facilitating diverse working practices and making efforts to build anenvironment that supports a work-life balance.

90

Furukawa Electric Group Sustainability Report 2014: Web version

Human Rights Awareness
The Furukawa Electric Group CSR Code of Conduct stipulates that we work to respect human rights, prohibiting
discriminatory treatment and human rights infringement as well as prohibiting harassment. We have alsoestablished a consultation desk concerning human rights concerns that can be accessed from within or outside
the company, and consultations by employees are promptly responded to jointly by the HR & Administration
Department and the CSR Department in the event that issues are reported. As of the end of fiscal 2014 there had
been no cases of involving human rights concerns within Furukawa Electric.
Furthermore, from the perspective of prevention, we have in place a rank-based training curriculum, including
executives and managers at affiliated companies. The curriculum centers on raising awareness, covering suchmatters as prohibition of discrimination against female employees, promoting employment of seniors and people
with disabilities, and improved understanding of Japanese social integration issues.

Improving the Working Environment through Labor-Management Opinion Exchanges
Furukawa Electric maintains a basic position that both labor and management should endeavor to engage insincere discussions, and therefore we focus on issue resolution and deepening mutual understanding.
We hold our Central Management Briefings twice annually for public exchanges of opinion between labor andmanagement. We have conducted such meetings for 62 years, since 1952. As of May 2014 we had held thesebriefings 123 times. Representatives from labor and management exchange frank opinions and share
information about a broad spectrum of items at these briefings, such as the business environment, management,
and topical matters.
We also have in place various committees such as the Personnel System Exploratory Committee and theCommittee for Studying Shorter Hours that are designed to improve the working environment, which
management and labor discuss on a daily basis. These discussions lead to improvements in various systems
and strengthen monitoring functions, such as compliance response and the implementation status of other CSR
activities.

91

Furukawa Electric Group Sustainability Report 2014: Web version

Occupational Health and Safety
Occupational Health and Safety Management Promotion System
In line with the new medium-term plan's policy of strengthening Group management, we have revised our activity
promotion structure. To this end, in fiscal 2014 we have established Furukawa Electric Group Occupational
Health and Safety Committee, chaired by the president. This committee, comprising members of management,deliberates, determines and follows up on policies and measures related to occupational health and safety
activities throughout the Group.

Promotion Framework

Status of Activities and Future Initiatives
Looking at our safety record during fiscal 2014, we failed to reach our target of one or fewer accidents requiring
leave, as three occurred. As a result, we have set about reforming our corporate culture to keep from taking a
backward step on our safety record and strengthening initiatives toward our goal of zero accidents and zero
hospitalizations.
In fiscal 2015, we established a basic policy for the Group. The core tenets of our basic policy for fiscal 2015
naturally include legal compliance, as well as content linked to reforming the corporate culture, such as"Becoming a Safety Conscious Person" and "Realizing Fundamental Safety".
Specifically, we have set forth the following five items.
1.

Endeavor to eradicate accidents in accordance with the objectives of the Industrial Safety and Health Act.

2.

Reduce accident risks by realizing "fundamental safety".

3.

Develop "safety conscious person" through communications and using the 5S.

4.

Aim at self-management through self-checks, maintenance and improvement.

5.

Practice Group health management activities through mental and physical health improvement.

92

Furukawa Electric Group Sustainability Report 2014: Web version

Message from the General Managers
Every single employee who works for Furukawa Electric Group should be able
to work in a safe and healthy way.
“Safety”, including hygiene, takes priority above everything else. We believe that
“ Safety” as a foundation for monozukuri protects people's lives, the“Environment” protects life on earth, “Quality” protects the life of a product, and“Efficiency” protects the life of our business; consequently, we prioritize thesegoals in this order.
From fiscal 2014, we have established the following two key pillars to our policy:“Becoming a Safety Conscious Person” and “Realizing Fundamental Safety”.
We have used a five-scale health and safety management assessment system to evaluate “Becoming a Safety
Conscious Person” from the perspective of “increasing knowledge and changing attitudes”; and to evaluate“Realizing Fundamental Safety” from the perspective of “fundamental reviews of facilities and processes”. At thesame time, we aim to use workplace activities to build a company that allows all of its employees to work withpeace of mind.

Hisashi Iwama
General Manager, Safety & Environment Promotion Department, Production Technology Division

Acquisition of Occupational Safety and Health Management System (OSHMS)
Accreditation
The system that Furukawa Electric Group has constructed has demonstrated its effectiveness in preventing labor
accidents. We are promoting the creation of this system and its third-party accreditation.
As of March 31, 2014, we had acquired management system accreditation (note 1) at the following sites.
Company

Site

Date acquired

Furukawa Electric Co., Ltd.

Chiba Works

January 13, 2009

Furukawa Electric Co., Ltd.

Hiratsuka Works

November 15, 2010

Furukawa Electric Co., Ltd.

Mie Works

November 15, 2010

Furukawa Electric Co., Ltd.

Nikko WorksMarch 23, 2012

Furukawa Electric Co., Ltd.

Copper Tube DivisionDecember 20, 2012

Furukawa Magnet Wire Co., Ltd.

Mie Plants

November 15, 2010

(note 1) Organizations covered by the Occupational Safety and Health Management System are certified as meeting JISHA
standards.

93

Furukawa Electric Group Sustainability Report 2014: Web version

Presentation on Health and Safety Activities
Furukawa Electric holds presentations to showcase its health and safety activities,
honoring those of particular merit. Each works conducts its own presentations,with selected groups announcing their activities at the companywide presentation.

Educating Employees at “Anzen Dojos”
Furukawa Electric has placed “Anzen Dojos” (safety education centers) at
manufacturing sites to enable employees to get a sense of the dangers. These
centers are designed as educational facilities where employees can experiencevarious dangers, such as heavy items, edged tools, work in high places, revolving
equipment and electricity, to raise their sensitivity to danger.

Executive Follow-up on Accidents
Furukawa Electric's officers with responsibility for safety carry out accident
follow-up activities, including follow-up on the accidents that occurred in theprevious fiscal year. They check up on the appropriateness and effectiveness ofmeasures, exchange opinions in the pursuit of “Realizing Fundamental Safety”,
and work hard to prevent recurrences.

Manufacturing Works Patrols/Factory Checks
Each month, patrols are conducted at our manufacturing works to identify sourcesof danger and make improvements. In addition, once each year a person in chargeof health and safety at another manufacturing works performs a factory check,conducting inspections from a different point of view to confirm that no dangers
have been overlooked.
We also conduct factory safety checks at Group companies, thereby extending theeffectiveness of these activities throughout the Group.

94

Furukawa Electric Group Sustainability Report 2014: Web version

Labor Accidents
In fiscal 2014 (April 2013 to March 2014), the frequency rate of accidents requiring leave (note 2) increased both for
Furukawa Electric on a standalone basis and for the domestic Group as a whole (note 3) and there was a slightdeterioration from the previous fiscal year.

(note 2) Frequency = (Accidents resulting in injury or death / total working hours) x 1 million(note 3) The scope of data collection for fiscal 2014 encompassed employees and temporary workers at Furukawa Electricand 38 affiliated companies in Japan.
(note 4) Data for “All sectors” and “Manufacturing” are based on the results of surveys carried out by the Ministry of Health,Labour and Welfare.

The frequency rate of accidents (38 affiliated companies in Japan)
1 Access Cable Company
2 FCM Co., Ltd.
3 Okano Electric Wire Co., Ltd.
4 Okumura Metals Co., Ltd.
5 NTEC Ltd.
6 KANZACC Co., Ltd.,
7 Shodensha Co., Ltd.
8 Seiwa Giken Inc.
9 VISCAS Corporation
10 The Foam Kasei Co., Ltd.
11 Furukawa S&D Co., Ltd.
12 Furukawa Techno Material Co., Ltd.
13 Furukawa Electric Advanced Engineering Co., Ltd.
14 MYOJYODENKI．Co.Ltd.
15 UACJ Corporation
16 Next Generation Power Device Technology
Research Association
17 TOTOKU Electric Co, Ltd.
18 FITEC Corp.
19 Furukawa Automotive Systems Inc.
20 Furukawa Elecom Co., Ltd.

21 Furukawa Sangyo Kaisha, Ltd.
22 FURUKAWA C&B CO., LTD.
23 FURUKAWA INDUSTRIAL PLASTICS CO., LTD.
24 Furukawa Precision Engineering Co., Ltd.
25 Furukawa Research Inc.
26 Furukawa Electric Ecotec Co., Ltd.
27 Furukawa Electric Industrial Cable Co., Ltd.
28 Furukawa Electric Power Systems Co., Ltd.
29 The Furukawa Battery Co., Ltd.
30 Furukawa Nikko Power Generation Inc.
31 FURUKAWA NEWLEAF CO.,LTD.
32 FURUKAWA NETWORK SOLUTIONCORPORATION
33 FURUKAWA FINANCE AND BUSINESSSUPPORT CO., LTD.
34 Furukawa Logistics Corp.
35 Furukawa Magnet Wire Co., Ltd.
36 FURUKAWA LIFE SERVICE Inc.
37 Miharu Communications Inc.
38 Riken Electric Wire Co., Ltd.

95

Furukawa Electric Group Sustainability Report 2014: Web version

From fiscal 2014, we have included data from overseas Group companies in the accident statistics data. The
data includes both accidents requiring leave and accidents not requiring leave. The frequency rate of accidents
for the Group as a whole in fiscal 2014 was 1.78.

Healthcare for Employees Working Long Hours
In accordance with the Guidelines issued by the Labor Standards Bureau entitled “Measures to be Taken by
Employers to Prevent Health Impairment Due to Overwork”, we strive to manage the health of employees who
work long hours by implementing strict limitations on working hours based on the results of health checkups andby arranging consultations for such workers with industrial physicians.

Mental Health Education
We began conducting mental health measures in fiscal 2003, and we have provided both managerial andgeneral employees with education and training programs to which industrial physicians and industrial nurses areinvited as lecturers. In the past, stress control training for employees aged 30-35, workplace mental healthtraining with a focus on Work Engagement(note 5), and Pleasant Workplace Discussion Sessions aimed at
improving the workplace environment have been implemented across the company. We have sought to revitalizeboth individuals and workplaces.
In fiscal 2015 and fiscal 2016, Self-care Training and Line Care Training programs will be implemented with theaim of helping all employees in their early forties and middle-ranking managers to respond to all types of change.
(note 5) A mental health concept pertaining to motivation, devotion, and energy regarding work

Strengthening Smoking Measures
In fiscal 2004, we commenced measures to counter smoking in earnest, introducing programs to prevent
exposure to passive smoke and encourage quitting smoking. As a result of such activities, the percentage ofsmokers among male employees has fallen by approximately 20 percentage points over 10 years. We aim toswitch to a smoking ban during working hours in fiscal 2018 and to an entirely smoke-free workplace by fiscal
2021 at the latest, and have continued to adopt a multifaceted approach with the following three main
approaches: sharing information, supporting efforts to quit smoking and creating a smoke-free environment.

96

Furukawa Electric Group Sustainability Report 2014: Web version

Smoking rates among Furukawa Electric employees (male)

Responding to Asbestos-Related Health Issues
During the period from fiscal 2006 to 2007, we once again investigated workplaces that previously handledasbestos products and we organized medical examinations focused on asbestos for all relevant employees. We
also sent out notices urging retired employees who worked at the relevant sites to undergo medical
examinations.
As of March 31, 2014, three people have been confirmed as being involved in industrial accidents, andsymptoms have been detected in nine.
Results of Medical Examinations
 People confirmed as having been in industrial accidents: Three (of whom one died of mesothelioma and one
died of lung cancer)People in whom symptoms detected: Nine (of whom one currently in employment and eight retired)97

Furukawa Electric Group Sustainability Report 2014: Web version

Employee Data Book
Group Data (Consolidated)
Number of Group Employees by Region

Furukawa Electric Data
Gender ratio of Employees

Gender ratio of Managers

Employee turnover rate by gender98Furukawa Electric Group Sustainability Report 2014: Web version

Recruitment figures by genderSpecialized staff

Professional staff

Fiscal
2009

Fiscal
2010

Fiscal
2011

Fiscal
2012

Fiscal
2013

Fiscal
2014

Fiscal
2015

Male

84

79

73

66

49

26

21

Female

17

13

9

12

10

6

5

Total

101

92

82

78

59

32

26

Foreign nationals

1

4

4

2

3

0

1

Male

86

44

15

21

2

0

0

Female

1

0

0

1

0

0

0

Total

87

44

15

22

2

0

0

Average pay by gender (Unit: Yen)
Fiscal 2010

Fiscal 2011

Fiscal 2012

Fiscal 2013 Fiscal 2014

Male

6,730,669

7,130,016

7,148,857

6,922,703

7,164,395

Female4,478,994

4,708,913

4,591,206

4,554,577

4,802,456

Average

6,551,629

6,929,268

6,747,553

6,570,185

6,851,869

Ratio of labor union membership (Unit: %)Fiscal 2010 Fiscal 2011 Fiscal 2012

Fiscal 2013 Fiscal 2014

Male

99.64

99.68

99.75

99.67

99.72

Female

97.56

97.11

98.23

98.62

98.07

Total

99.46

99.45

99.61

99.57

99.57

Overtime (Unit: Average hours per month)Fiscal 2009 Fiscal 2010

Fiscal 2011 Fiscal 2012 Fiscal 2013

Fiscal 2014

Direct work

21.62

23.36

24.15

23.84

24.33

26.17

Indirect work

18.44

14.06

17.03

17.45

18.14

19.27

Average

20.1

17.75

19.72

19.85

20.46

21.83

Regular annual leave
Fiscal
2009

Fiscal
2010

Fiscal
2011

Fiscal2012

Days carried over per person (A)

22.5

22.0

22.6

21.8

22.1 Days

Days granted per person (B)

24.0

23.9

23.9

23.6

23.7 Days

Days acquired per person (C)

13.6

13.3

13.1

13.0

14.1 Days

Acquisition rate (C÷B)

56.7

55.6

54.8

55.1

59.5 %

Item

Fiscal2013

Unit(note) Regular annual leave is calculated as leave taken between September 16 and September 15 of the following year.
Figures for fiscal 2014 are calculated for the annual leave year that has not yet concluded.

99

Furukawa Electric Group Sustainability Report 2014: Web version

People taking volunteer leave
Fiscal 2012 Fiscal 2013

Fiscal 2014

Female

0

0

0

Male

1

5

5

Total

1

5

5

(note) Fiscal 2014, five people took advantage of this leave, bringing the total number to date to eight.
People taking refresh leave
2011

2012

2013

Female

1

4

2

Male

63

77

74

Total

64

81

76

(note) 1 Refresh leave is calculated on a calendar basis (January 1 to December 31)
2 Refresh leave is a system that accords employees who have worked for 25 years continuous leave of between 14 and 31
days.
People taking maternity/paternity leave
Fiscal2010
FemaleRatio of employees returning to work (%)
Male
Ratio of employees returning to work (%)
Total
Ratio of employees returning to work (%)

Fiscal Fiscal
2011
2012

Fiscal
2013

Fiscal
2014

39

35

35

33

22

100.0

97.1

97.1

97.0

95.5

4

4

10

7

5

100.0

100.0

100.0

100.0

100.0

43

39

45

40

27

100.0

97.4

97.8

97.5

96.3

Fiscal
2010

Fiscal
2011

Fiscal
2012

Fiscal Fiscal
2013
2014

People taking nursing care leave

Female

0

0

0

0

0

Ratio of employees returning to work (%)

-

-

-

-

-

Male

0

1

2

2

0

Ratio of employees returning to work (%)

-

100.0

100.0

100.0

-

Total

0

1

2

2

0

Ratio of employees returning to work (%)

-

100.0

100.0

100.0

-

100

Furukawa Electric Group Sustainability Report 2014: Web version

Relations with Communities

Furukawa Electric Group Basic Policy on Social Contribution Activities(Revised March, 2011)
Furukawa Electric Group will continuously undertake social contribution activities focusing on nurturing future
generations, promoting sport and culture, and living in harmony with the natural environment and local
communities, in addition to its business-related activities, in order to maintain and strengthen community ties built
over centuries and create a better tomorrow for future generations.

Basic Policy
Furukawa Electric Group have continued to conduct social contribution activities that are rooted in the local
community. Going forward, we will strengthen these actions further along the three dimensions of nurturing future
generations, promoting sport and culture, and living in harmony with the natural environment and local
communities.

Challenges and Future Policy
In the charity event held to support Reconstruction from the Great East Japan Earthquake, we conducted aquestionnaire survey on “social problem-solving and contribution”, “activities unique to our company”, and otherthemes. The results have shown that people are highly interested in “promotion of sports”, “use of naturalenergy”, and “technology and Monozukuri (manufacturing) education”. We will implement programs utilizing ouruniqueness in line with Furukawa Electric Group Basic Policy on Social Contribution Activities.

CSR Awards
Fifth CSR Awards
Furukawa Electric established the CSR Awards to recognize the social contribution or environmental
preservation efforts of our subsidiaries that notably exceed their regular business. CSR Award-winningcompanies work on a daily basis to continue contributing to society through these activities.

Social Contribution Award
Furukawa Sangyo Kaisha, Ltd.
As for assistance to the areas affected by the Great East Japan Earthquake, Furukawa Sangyo has participatedin reconstruction there through its core business. In 2013, we carried out a new activity, “Affected Area Tour
Training” in cooperation with a local NPO. A total of 26 of our employees, mainly young workers, made a
two-day-visit to the quake-hit areas in Miyagi Prefecture where they interacted with disaster victims and helped
101

Furukawa Electric Group Sustainability Report 2014: Web version

improve a seawall as volunteers. We received messages from the victims who said things like “It was very nicetalk to them”, and “They took our sorrow seriously”. We even more keenly realized how important it is to express
gratitude. At the briefing session in the company held after the training, we shared the participants’ valuable
experiences. In order to contribute to reconstruction in the region, we will develop emotional connections throughnot just our products but also through “sympathy” by continuously conducting such training.

Social gathering with the local NPO staff and thequake-victims

Volunteer activity in “Millennium Hope Hills” in
Iwanuma City

Environmental Preservation Award
Furukawa Industrial S.A. Produtos Eletricos 〔FISA〕(Brazil)
FISA has worked ahead of the industry to prevent environmental pollution andreduce CO2. One such effort is the collection and recycling of LAN cables(Green IT Program) that started in 2008. FISA further developed this initiativeand its LSZH (Low Smoke Zero Halogen) LAN cable was eventually certified by
Associação Brasileira de Normas Técnicas (ABNT) as an eco-friendly productand given an eco-label. It had to ask not only its own employees but also its
suppliers, customers, and logistics companies for cooperation since obtaining
the label requires a product to be eco-friendly throughout its life cycle. The
Curitiba Factory mainly made efforts, and as a result, FISA was certified inAugust 2011; it is a certification that has been maintained. As of June 2014, no
LAN cables of other companies have obtained the eco-label certification, andthis certification has led to not only the conservation of the global environment
but also increased Furukawa’s strong brand.

102

Eco-label certification

Furukawa Electric Group Sustainability Report 2014: Web version

Activities to obtain and maintain eco-labels

Development: All raw materials complying to RoHS Directive

Manufacturing: Reducing energy consumption, water consumption and industrial waste

Sales & Logistics: Efficiency improvement of accommodation of products into truckDisposal & Collection: Constructing a recycling system of products

Environmental Preservation Award
Furukawa Electric Autoparts Philippines Inc. 〔FEAP〕(Philippines)
FEAP, mainly CSR team members continuously work on volunteer activities such as cleanup and repair ofschool facilities and assistance in nursing homes. Of the volunteer projects, we participate in ones in Mt. Makilingand around Lake Caliraya every year with the aim of nurturing future generations, living in harmony with local
communities, and preserving the environment. FEAP is involved in efforts to preserve natural, precious andvanishing environments and ecology by restoring pavement (eco-trail) in Mt. Makiling and Planting around Lake
Caliraya.

Restoring pavement in Mt. Makiling

Planting trees around Lake Caliraya

Activities in Each Region
Activity Topics
Hiratsuka City <Citizen's Academy> Field Trip for Adults (Furukawa Electric, Hiratsuka)
The Hiratsuka Works accepted “Field Trip for Adults,” one of the
Citizen's Academy courses hosted by the central community
center. The first-ever course in Hiratsuka City allowed Hiratsuka
citizens to visit three manufacturers including our company in thecity. We explained the philosophy, history, businesses, andoverview of our company and the Hiratsuka Works, and then,showed the participants the actual Monozukuri (manufacturing) in
our factory. During the tour and the Q&A session, we received agreat many questions, which made us aware that people are very103

Furukawa Electric Group Sustainability Report 2014: Web version

interested in Monozukuri. It was also a good chance for us to have neighborhood residents deepen their interestand understanding of what our works is doing. We will continue to actively interact with them.

Town Autumn Concert (Furukawa Automotive Systems Inc.)
Furukawa AS accepts trainees from Vietnam. Their dormitory is in
the region of Kawasebaba Station, Hikone City, Shiga Prefecture
where the residents' association holds an annual event, the“Autumn Concert.”
In 2013, our (Furukawa AS's) trainees were invited to the concert.
The trainees introduced Vietnam to local people, showing themslides, and sang and danced dressed in their ethnic costume,
which promoted friendship and had the locals more deeply
understand Vietnam.
The event gave the trainees and the local residents an opportunity to become familiar with each other. We willfurther deepen our relationship in ways like greeting each other every morning and evening.

VOICE
I completely felt comfortable with people in the town in just a day. I hopeto have more opportunities like this to interact with people there.
This event deepened our relationship with the local residents. I madefriends in just a day.

NGUYEN THI KIM DUYEN, VO THI VAN
Production Section,
Furukawa Automotive Systems Inc.

104

Furukawa Electric Group Sustainability Report 2014: Web version

Activities in Each Region
Our group implements different regional activities.

Nurturing Future Generations
Example: Supporting and cooperating to offer work experience
to elementary, junior and senior high school students


Furukawa Electric Co., Ltd.
(Chiba Works, Hiratsuka Works, Nikko Works, Copper Foil
Division)

Access Cable Company



Furukawa Electric Power Systems Co., Ltd.



Okano Electric Wire Co., Ltd.

The Furukawa Battery Co., Ltd.

Furukawa Logistics Corp.

Showing a 40tons forklift during the plant
tour by the local elementary school
Furukawa Electric and Furukawa
Logistics, Chiba

Promoting Sports and Culture
Example: Participating in and supporting sports events, Holding,participating in, and supporting (donations included) festivals


Furukawa Electric Co., Ltd.
(Chiba Works, Mie Works, Nikko Works, Copper Foil Division)

Access Cable Company



Furukawa Electric Power Systems Co., Ltd.

KANZACC Corp.



Furukawa Automotive Systems Inc.

Local residents holding a trout-fishingfestival in the company’s regulating
reservoir



Furukawa Precision Engineering Co., Ltd.

Furukawa Nikko Power Generation



The Furukawa Battery Co., Ltd.



Miharu Communications Inc.



Furukawa Magnet Wire Co., Ltd.

Furukawa Nikko Power Generation Inc.

105

Furukawa Electric Group Sustainability Report 2014: Web version

Living in Harmony with the Natural Environment
Example: Participating in the environment beautification
campaign


Furukawa Electric Co., Ltd.
(Chiba Works, Hiratsuka Works, Mie Works, Nikko Works,
Copper Foil Division, Copper Tube Division, Yokohama Works)

Access Cable Company



NTEC Ltd.



Okumura Metals Co., Ltd.

TOTOKU Electric Co, Ltd.

Furukawa Automotive Systems Inc.



Furukawa Sangyo Kaisha,Ltd.



Furukawa C&B Co., Ltd.

Furukawa Precision Engineering Co., Ltd.

Furukawa Logistics Corp.



Furukawa Techno Material Co., Ltd.



Riken Electric Wire Co., Ltd.

Furukawa Electric Ecotec Co., Ltd.

Furukawa Magnet Wire Co., Ltd.

Furukawa Nikko Power Generation Inc.

Cutting grass near a children’s
playground jointly with Hosoo Residents’
Association
Furukawa Precision Engineering
Logistics, Chiba

Shonan shoreline cleanup campaign,sponsored by the Young Women's
Division of the Labor Union
Furukawa Electric, Hiratsuka
Logistics, Chiba

Campaign against illegal dumping
Furukawa Electric, Mie Furukawa
Electric, Hiratsuka Logistics, Chiba

106

Furukawa Electric Group Sustainability Report 2014: Web version

Awards from Outside Sources
2014
PeriodSubject / Implementing organization
Maejima Hisoka Award

Mar.

Implement organization: The Tsushin Bunka Association

Winning organization
Hiroshi Ishihara
Adviser,
Furukawa Electric

2013
PeriodNov.

Subject / Implementing organization
Won the Industrial Science and Technology
Policy and Environment Director Award of Ministry of Economy,
Trade and Industry: “Management Contributor of a Proper
Measurement Control Business Place”

Winning organization

Yukio Matsui,
Furukawa Electric Advanced Engineering

Implement organization: Ministry of Economy, Trade andIndustry

Sep.

Was awarded the title of Fellow of the Institute ofElectronics, Information and Communication Engineers (IEICE):
The technology development of the high-power and broadband
erbium doped optical fiber amplifier
Implement organization: Institute of Electronics, Information andCommunication Engineers
Best Paper Awards of OECC/PS

Jul.

Implement organization: Conference on Lasers andElectro-Optics Pacific Rim and OptoElectronics andCommunications Conference

Haruki Ogoshi
Director of FITEL Photonics Laboratories,
Furukawa Electric

Masanori Takahashi and three others
FITEL Photonics Laboratories,
Furukawa Electric
Hiroshi Kawashima
FITEL Products Div.,
Furukawa Electric

Relations with Public Policy
As a company that supports infrastructure environments such as telecommunications and energy, we
will play our role in policy formation and carry out problem-solving measures while maintaining atransparent and fair relationship with government.

107

Furukawa Electric Group Sustainability Report 2014: Web version

Editorial Policy
Editorial Policy
This report aims to inform all stakeholders about the philosophy and measures of Furukawa Electric Group in
relation to its business activities, management, the environment and its relationship with society. What's more,this year we have compiled a digest version containing a collection of articles with strong and importantmessages. When editing the digest version, we have tried to provide information in a concise and clear manner,in a way that targets as broad a readership as possible.
We have been disclosing the report under the CSR section of the Furukawa Electric website instead of
publishing a booklet for it. We also provide the digest version (PDF file) on the website so that you can download
it.

Scope of This Report
Period Covered

Fiscal 2014, from April 1, 2013 to March 31, 2014
(note) Includes selected information on past initiatives and activities during fiscal 2015.

Publication Timeframe

Publication date: September, 2014
Planned publication of next edition: September, 2015

Organizations Covered

This report covers Furukawa Electric Co., Ltd. and affiliated companies in Japan and overseas.
Where activities are limited to specific regions or companies, this fact has been clearly indicatedin the reporting.

Source Guideline
We referred to the GRI “Sustainability Reporting Guidelines 2006 (3rd Edition)” in composing this report.

108

Furukawa Electric Group Sustainability Report 2014: Web version

Accuracy of the Data Disclosed in This Report
In order to maintain accuracy in data disclosure, the information provided in this report has been vetted by thedivisions in charge of the relevant information, the Investor & Public Relations Department and the CSR
Department, which is in charge of editing this report. We have also provided a third-party opinion so as to offer
the point of view of an outside expert.

Information Disclosure System
Furukawa Electric is fully aware that the timely and appropriate disclosure of corporate information to investors isessential to a healthy stock market. We take a serious approach to providing timely and appropriate corporate
information to investors, including through the development of internal systems that allow us to disclose rapid,
accurate and fair corporate information in a way that always keeps investors’ perspective in mind.
Moreover, in order to increase the understanding of all stakeholders in respect to our company, we try to provide
information through a variety of media, including non-financial information (see diagram on right).

Editing and Publication
CSR Department, Administration & CSR Division, Furukawa Electric Co., Ltd.
Marunouchi Nakadori Bldg., 2-3, Marunouchi 2-chome, Chiyoda-ku, Tokyo 100-8322, Japan109

Furukawa Electric Group Sustainability Report 2014: Web version

Third-Party Opinion
Mr. Toshihiko Goto
Chief Executive Officer, Sustainability Forum Japan

Career Summary
Board Member, Global Compact Network Japan, Founder, Japan Sustainable
Investment Forum.
Also, Chairman, Sustainable Management Forum of Japan, Senior executive
director, The Japan Society for Global System and Ethics, and a member ofsome other academic societies.
National committee member for ISO/TC207, SCI, SC4, A judge for theEnvironmental Communication Award by the Ministry of the Environment, Japan Government (MoE) and amember or the convener of some other committees of MoE. He wrote many books and articles.
He had graduated from the Tokyo University, Faculty of Law.

Over almost a decade Furukawa Electric has been beset by a number of problems that might have damaged its
reputation in society or caused its employees to lose heart. However, the company has succeeded in businessfor 130 years because the hard work of its managers and employees has allowed it to continue providing added
value to society in some shape or form, supported by some good luck along the way, such as a steady supply of
raw materials.
The 21st century has been referred to as the post-industrial age(note 1) and the focus now has switched toknowledge. Rather than depending on a steady supply of raw materials, the foundations for the next giant leap
forward will be built through continued creativity and innovation.
I believe that “proactive CSR” involves revitalizing and reforming these foundations and management systems.
In 2010, Keidanren made a major revision to its Charter for Corporate Behavior and removed the description of
corporations as “economic entities designed to pursue profits”, which had been an ever-present concept until thattime. It replaced this with the role of creating added value and generating employment. Creating profits isessential to achieving this role, but profits are the means and not the ultimate goal.
Happily, Furukawa Electric's founding spirit, basic philosophy, management philosophy and action guidelines are
all in agreement with the revised Charter for Corporate Behavior. The challenge lies in making this part andparcel of the company's organization and corporate culture, and I believe innovation is necessary to achieve this.
The Sustainability Report could be described as a finished version of what previous reports have aimed for. Its
focus is on the company's track record and its aims and goals over the next year or two. However, during FY2014
four major developments occurred in relation to the report, as follows: the EU issued a revised directive draft110Furukawa Electric Group Sustainability Report 2014: Web version

strengthening companies' obligation to disclose non-financial information; GRI issued the G4 Sustainability
Reporting Guidelines(note 2); the IIRC announced its Integrated Reporting Framework(note 3); and the Financial
Services Agency published the Japanese version of the Stewardship Code (note 4). I will omit the details, butessentially these developments are linked by the need for a long-term perspective and long-term success. In theworld of investment, outside Japan there has already been a major shift towards ESG investment (note 5) from along-term perspective.
From this perspective, the latest report could be seen as a conservative CSR report and from next year onwards
there is a need to incorporate a new direction with a focus on a longterm perspective and long-time success. This
would also assist the disclosure of information targeting ESG investment, which prioritizes a long-term
perspective.
Incorporating a long-term perspective into the report is “easy to say”. However, it is not easy to incorporate
perspectives from 2030 or 2050. However, I am convinced that taking on this challenge will lead to corporate
innovation.
I believe it is important to think about how your own company will develop by 2030 and 2050 and to imagine theideal future vision for your company under the following environmental restrictions: by around 2030, procurementof mineral resources will become difficult and by 2050 mineral resources will be almost depleted or extremely
expensive; Japan will need to have made CO2 reductions of at least 80%; the population of Japan will fall below
100 million and Japan will become a super-aged society; South Korea and China will also become aged
societies.
For this reason, I believe it is necessary to carry out a “backcast” from these dates and consider what needs tobe achieved by 2030 or 2020. In the medium-term management plan for next three years, it will be essential todraft a target plan that includes not only forecasts but also “backcasts” from the long-term vision.
When we consider the long-term vision, it goes without saying that some items require long-term policies andplans. For example, when procuring raw materials there is a need to consider CSR from the highest point
upstream, in other words excavation. In order to do this, there is a need for policies and plans that take into
account matters such as biodiversity and human rights.
There is also a need to develop long-term policies and plans for the development of alternative raw materials,
and for reuse and recycling. When we consider Japan's population trends, diversity policies are an essential partof human resource policies. Without long-term policies and plans, devotion and hard work alone will not beenough to impress investors.
Companies around the world have shown a great deal of interest in the United Nations' Post-2015 Development
Agenda(note 6). All of the twenty or so targets to 2030 that are currently being discussed require business solutions,and this will also lead to opportunities for business. This requires a long-term and broad perspective.
Luckily, I have learned from seeing the commitments made by Furukawa Electric's top executives and from
attending hearings that the company recognizes the issues I have raised here and is making efforts to make thenecessary preparations. All that is left now is to put this into practice.
111

Furukawa Electric Group Sustainability Report 2014: Web version(note 1) Industrial capitalism:
This refers to capitalism that creates profits through industrial activities based largely on the industries established as a resultof the industrial revolution. It is widely argued that in future the source of profits will shift away from “goods” and towards“people (knowledge)”.
(note 2) GRI's G4:
The fourth version (G4) of the globally applied CSR reporting guidelines published by GRI (Global Reporting Initiative).
https://www.globalreporting.org/(note 3) IIRC Integrated Reporting Framework:
The Integrated Reporting Framework was published in December 2013 by the IIRC (The International Integrated Reporting
Council) after many years of discussions. The framework encourages reporting on long-term development using integrated
financial and non-financial information.
http://www.theiirc.org/(note 4) Financial Services Agency's Japanese version of the Stewardship Code:This is the name given to the Principles for Responsible Institutional Investors published by the Financial Services Agency in
February 2014. The Principles have been given the subheading “to promote the sustainable growth of companies throughinvestment and dialogue”.
http://www.fsa.go.jp/en/refer/councils/stewardship/20140407.html(note 5) ESG investment:This is a form of investment that prioritizes non-financial information, including E (Environment), S (Society) and G(Governance), as a way of measuring of corporate value in addition to financial information. It is a form of investment basedon the idea that ESG is a risk factor for companies and at the same time it can provide returns by improving corporate value inthe long-term.
(note 6) United Nations' Post-2015 Development Agenda:
As the deadline for achieving the United Nations Millennium Development Goals (MDGs) approaches, a broad debate has
begun with a view to formulating international development targets after 2015 (post-2015). Discussions have been carried out
not only at the United Nations but also involving industry and NGOs. The plan is to adopt the goals at the United Nations
General Assembly in September 2015.
http://www.mofa.go.jp/policy/oda/mdg/

112

Furukawa Electric Group Sustainability Report 2014: Web version

History of Furukawa Electric's CSR Activities
1972

Companywide Rules for Pollution Prevention
formulated

1974

Environmental Control Department
established1989

Energy Conservation Team establishedTeam for Reduction in Use of Specified
CFCs established

1992
1993

Anti-Monopoly Act Guidelines issued
Basic Framework for Protecting the Global
Environment formulated(Furukawa Electric's voluntary environmental
preservation plan)

1996

Use of specified CFCs and trichloroethane
discontinued
Team for Promotion of Reduction in
Industrial Waste established

1997
1998

2000

Policy formulated
Furukawa Electric Group Basic Policy on
Social Contribution Activities formulated
Furukawa Electric Basic Policy on Pandemic
Influenza Preparedness formulated
Compliance pledge introduced

2009

Basic Policy on BCM (Business Continuity
Management) formulated
Compliance awareness survey covering all
employees conducted

Furukawa Electric Basic Environmental
Policy formulated
Acquisition of ISO 14001 certificationcommenced

2010

Environmental accounting started
Zero-emissions activities commenced

2002
2003

Anti-Monopoly Law manual published
Furukawa Survival Plan announced

Compliance Months introduced
Compliance awareness surveys for affiliatedcompanies conducted
2011

Executive Officer System introduced
Furukawa Electric Basic Environmental
Policy revised
2004

2005

2006

2007

Information security and personal
information protection months introduced
Furukawa Electric Group Basic Policy on
CSR revised¥250 million donated for reconstruction
support for the region affected by the Great
East Japan Earthquake (Groupwide)
Furukawa Electric Group CSR Code of
Conduct revised, and Furukawa ElectricGroup Action Guidelines accordingly
eliminatedCompany system and chief officer system
introduced
Furukawa Electric Group Action Guidelines
formulated
Furukawa New Leaf established as a special
subsidiary offering employment to people
with disabilities
Internal reporting system introduced andinternal and external reporting desks
established2012

Compliance Handbook published
Medium-term management plan Innovation
09 announced

Competition Laws Compliance Guide
published
BCAO Award 2011, the “Award for Practical
Excellence,” received from the BusinessContinuity Advancement Organization(BCAO)
Report name revised to Sustainability Reportand issued
Furukawa Electric Group Anti-Bribery
Statement and Bribery Prevention Guide
formulated

Report published under the revised title“Environmental and Social Report”
CSR Division established2013

Chief Social Responsibility Officer (CSRO)
appointed
Report published under the revised title“CSR Report”

Medium-term management plan, Furukawa
G Plan 2015, announced
Transitioned from company system and chief
officer system to a system of strategic
business units and head office divisions
Administration & CSR Division inaugurated

Corporate philosophy and corporate
message of the Furukawa Electric Group
formulated
2008

A CSR award newly established as a part of
the Outstanding Affiliated Company Awards
Medium-term management plan, New
Frontier 2012, formulated
CSR Deployment Guideline for Business
Partners issued“Heart-to-heart communication between
president and employees” and “Compliance
Roundtables” initiatedCompanywide Regulations for Pollution
Prevention revised to create theCompanywide Regulations forEnvironmental Management
First Environmental Report published2001

e-Friendly mark (environmentally
harmonious product) certification systemstartedFurukawa Electric Group Green
Procurement Activity Guidelines published

Furukawa Electric Basic Environmental

113

Furukawa Electric Group Sustainability Report 2014: Web version

GRI Guideline Table of Contents
No.

Indicators

Page

1. Strategy and Analysis
1.1
1.2

Statement from the most senior decision-maker of the organization (e.g.,CEO, chair, or equivalent senior position) about the relevance of sustainabilityto the organization and its strategy.

Description of key impacts, risks, and opportunities.

No.

Top Message
Top Message
Risk Management

Indicators

Page

2. Organizational Profile
2.1

Name of the organization.

Company Profile

2.2

Primary brands, products, and/or services.



Company Profile
Business Field

2.3

Operational structure of the organization, including main divisions, operatingcompanies, subsidiaries, and joint ventures.

Global Network

2.4

Location of organization's headquarters.

Company Profile

2.5

Number of countries where the organization operates, and names ofcountries with either major operations or that are specifically relevant to thesustainability issues covered in the report.

Global Network

2.6

Nature of ownership and legal form.

Company Profile

2.7

Markets served (including geographic breakdown, sectors served, and types
of customers/beneficiaries).

Global Network

Scale of the reporting organization, including:Number of employees;
Net sales (for private sector organizations) or net revenues (forpublic sector organizations);
Total capitalization broken down in terms of debt and equity (forprivate sector organizations); andQuantity of products or services provided.

Company Profile
Key Indicators



2.8






2.9


2.10

Significant changes during the reporting period regarding size, structure, orownership including:
The location of, or changes in operations, including facility
openings, closings, and expansions; andChanges in the share capital structure and other capital formation,
maintenance, and alteration operations (for private sector organizations).

Awards received in the reporting period.

No.

Indicators-

SourcesAwards from Outside

Page

3. Report Parameters
Report Profile
3.1

Reporting period (e.g., fiscal/calendar year) for information provided.



Editorial Policy

3.2

Date of most recent previous report (if any).



Editorial Policy

3.3

Reporting cycle (annual, biennial, etc.)



Editorial Policy

3.4

Contact point for questions regarding the report or its contents.



Editorial Policy

Editorial Policy

Report Scope and Boundary
3.5

Process for defining report content, including:
Determining materiality;
114

Furukawa Electric Group Sustainability Report 2014: Web version



Prioritizing topics within the report; andIdentifying stakeholders the organization expects to use the report.

3.6

Boundary of the report (e.g., countries, divisions, subsidiaries, leased
facilities, joint ventures, suppliers). See GRI Boundary Protocol for further 
guidance.

3.7

State any specific limitations on the scope or boundary of the report.

-

3.8

Basis for reporting on joint ventures, subsidiaries, leased facilities,
outsourced operations, and other entities that can significantly affectcomparability from period to period and/or between organizations.

-

3.9

Data measurement techniques and the bases of calculations, including
assumptions and techniques underlying estimations applied to thecompilation of the Indicators and other information in the report.

-

3.10.

Explanation of the effect of any re-statements of information provided inearlier reports, and the reasons for such re-statement (e.g.,
mergers/acquisitions, change of base years/periods, nature of business,measurement methods).

-

3.11

Significant changes from previous reporting periods in the scope, boundary,or measurement methods applied in the report.

No significant changes

Editorial Policy

GRI Content Index
3.12

Table identifying the location of the Standard Disclosures in the report.

GRI Guideline Table of Contents

Assurance
3.13

Policy and current practice with regard to seeking in the assurance reportaccompanying the sustainability report, explain the scope and basis of anyexternal assurance provided. Also explain the relationship between thereporting organization and the assurance provider(s).

Third-Party Opinion

No.

Indicators

Page

4. Governance, Commitments and Engagement
Governance
4.1

Governance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting 
strategy or organizational oversight.

4.2

Indicate whether the Chair of the highest governance body is also an
executive officer (and, if so, their function within the organization's
management and the reasons for this arrangement).



Corporate Governance

4.3

For organizations that have a unitary board structure, state the number ofmembers of the highest governance body that are independent and/or
non-executive members.

Corporate GovernanceCorporate Governance
CSR Management/CSR
Promotion Framework

Corporate Governance
Upgrading and Enhancing
Workplace Environments/Improving
the Working Environment throughLabor-Management Opinion
Exchanges

4.4

Mechanisms for shareholders and employees to provide recommendations
or direction to the highest governance body.

4.5

Linkage between compensation for members of the highest governancebody, senior managers, and executives (including departure arrangements),and the organization's performance (including social and environmental
performance).

Corporate Governance

4.6

Processes in place for the highest governance body to ensure conflicts ofinterest are avoided.

Corporate Governance

4.7

Process for determining the qualifications and expertise of the members of
the highest governance body for guiding the organization's strategy on
economic, environmental, and social topics.

-

4.8

Internally developed statements of mission or values, codes of conduct, and
principles relevant to economic, environmental, and social performance andthe status of their implementation.

CSR Management/Group
Philosophy, Basic Policy and CSR
Code of Conduct

4.9

Procedures of the highest governance body for overseeing the

CSR Management/CSR

115

Furukawa Electric Group Sustainability Report 2014: Web version

organization's identification and management of economic, environmental,
and social performance, including relevant risks and opportunities, and 
adherence or compliance with internationally agreed standards, codes ofconduct, and principles.
4.10.

Promotion Framework
Corporate Governance

Processes for evaluating the highest governance body's own performance,
particularly with respect to economic, environmental, and social

performance.

Corporate GovernanceCommitments to External Initiatives


4.11

Explanation of whether and how the precautionary approach or principle isaddressed by the organization.

Risk Management/Overview
of the Risk Management Structure
Compliance
Environmental Risk
Management

4.12

Externally developed economic, environmental, and social charters,
principles, or other initiatives to which the organization subscribes orendorses.

-

Memberships in associations (such as industry associations) and/or
national/international advocacy organizations in which the organization:
Has positions in governance bodies;
Participates in projects or committees;
Provides substantive funding beyond routine membership dues; orViews membership as strategic.

-






4.13



Stakeholder Engagement



4.14

List of stakeholder groups engaged by the organization.

4.15

Basis for identification and selection of stakeholders with whom to engage.

4.16

Approaches to stakeholder engagement, including frequency ofengagement by type and by stakeholder group.

4.17

Key topics and concerns that have been raised through stakeholder
engagement, and how the organization has responded to those key topics
and concerns, including through its reporting.

No.

Indicators



CSR
Management/Stakeholder Relations
CSR
Management/Stakeholder Relations-

Page

5. Management Approach and Performance Indicators
Economic
Management Approach
Economic Performance
EC1

Direct economic value generated and distributed, including revenues,
operating costs, employee compensation, donations and other community
investments, retained earnings, and payments to capital providers andgovernments.

EC2

Financial implications and other risks and opportunities for theorganization's activities due to climate change.

-

EC3

Coverage of the organization's defined benefit plan obligations.

-

EC4

Significant financial assistance received from government.

-

Key Indicators

Aspect: Market Presence
EC5

Range of ratios of standard entry level wage compared to local minimum
wage at significant locations of operation.

-

EC6

Policy, practices, and proportion of spending on locally-based suppliers at
significant locations of operation.

-

EC7

Procedures for local hiring and proportion of senior management hired fromthe local community at locations of significant operation.

-

Aspect: Indirect Economic Impacts
EC8Development and impact of infrastructure investments and services
provided primarily for public benefit through commercial, in kind, or pro

116



Initiatives forSociety/Activities in Each Region

Furukawa Electric Group Sustainability Report 2014: Web version

bono engagement.
EC9Understanding and describing significant indirect economic impacts,
including the extent of impacts.

-

Environmental
Management Approach
Materials



EN1

Materials used by weight or volume.

EN2

Percentage of materials used that are recycled input materials.

Material Flow-

EnergyEN3

Direct energy consumption by primary energy source.

Material Flow
Preventing Global Warming

EN4

Indirect energy consumption by primary source.

Material Flow
Preventing Global Warming

EN5

Energy saved due to conservation and efficiency improvements.

Preventing Global Warming

EN6

Initiatives to provide energy-efficient or renewable energy based products
and services, and reductions in energy requirements as a result of these 
initiatives.

Non-financial Key Indicators
Environmentally Friendly

EN7

Initiatives to reduce indirect energy consumption and reductions achieved.

ProductsNon-financial Key Indicators
Preventing Global WarmingMaterial Flow

Water
EN8

Total water withdrawal by source.

EN9

Water sources significantly affected by withdrawal of water.

-

EN10

Percentage and total volume of water recycled and reused.

-

Biodiversity
EN11

Location and size of land owned, leased, managed in, or adjacent to,protected areas and areas of high biodiversity value outside protectedareas.

-

EN12

Description of significant impacts of activities, products, and services on
biodiversity in protected areas and areas of high biodiversity value outside
protected areas.

-

EN13

Habitats protected or restored.

-

EN14

Strategies, current actions, and future plans for managing impacts on
biodiversity.

EN15

Number of IUCN Red List species and national conservation list species
with habitats in areas affected by operations, by level of extinction risk.



Biodiversity Conservation-

Emissions, Effluents, and Waste
EN16

Total direct and indirect greenhouse gas emissions by weight.

Preventing Global Warming

EN17

Other relevant indirect greenhouse gas emissions by weight.

Preventing Global Warming

EN18

Initiatives to reduce greenhouse gas emissions and reductions achieved. Preventing Global Warming

EN19

Emissions of ozone-depleting substances by weight.

Preventing Global Warming

EN20

NO, SO, and other significant air emissions by type and weight.




EN21

Total water discharge by quality and destination.

EN22

Total weight of waste by type and disposal method.

EN23

Total number and volume of significant spills.

EN24

Weight of transported, imported, exported, or treated waste deemedhazardous under the terms of the Basel Convention Annex I, II, III, and VIII,
and percentage of transported waste shipped internationally.

-

EN25

Identity, size, protected status, and biodiversity value of water bodies and-Material Flow
Chemical SubstanceManagement
-





117

Material Flow
Reducing Waste
Environmental Risk
Management

Furukawa Electric Group Sustainability Report 2014: Web version

related habitats significantly affected by the reporting organization's
discharges of water and runoff.
Products and Services
EN26

Initiatives to mitigate environmental impacts of products and services, and
extent of impact mitigation.

EN27

Percentage of products sold and their packaging materials that arereclaimed by category.

Products

Environmentally Friendly-

Compliance
EN28

Monetary value of significant fines and total number of non-monetary
sanctions for noncompliance with environmental laws and regulations.

-

Transport
EN29

Significant environmental impacts of transporting products and other goods
and materials used for the organization's operations, and transporting
members of the workforce.

Preventing Global Warming

Overall
EN30

Total environmental protection expenditures and investments by type.

Environmental
Management/Environmental
AccountingEmployee Data Book/Group
Data (Consolidated)

Labor Practices and Decent WorkManagement Approach
Employment
LA1

Total workforce by employment type, employment contract, and region.

LA2

Total number and rate of employee turnover by age group, gender, and 
region.

Employee Data
Book/Furukawa Electric Data

LA3

Benefits provided to full-time employees that are not provided to temporary
or part-time employees, by major operations.

-

Labor/Management Relations



LA4

Percentage of employees covered by collective bargaining agreements.

LA5

Minimum notice period(s) regarding operational changes, including whether
it is specified in collective agreements.

Employee Data
Book/Furukawa Electric Data-

Occupational Health and Safety
LA6

Percentage of total workforce represented in formal jointmanagement–worker health and safety committees that help monitor andadvise on occupational health and safety programs.

Employee Data
Book/Furukawa Electric Data

LA7

Rates of injury, occupational diseases, lost days, and absenteeism, and 
number of work-related fatalities by region.

Occupational Health and
Safety/Labor Accidents

Occupational Health and
Safety/Educating Employees at“Anzen Dojos”
Occupational Health and
Safety/Healthcare for Employees
Working Long Hours

LA8

Education, training, counseling, prevention, and risk-control programs inplace to assist workforce members, their families, or community membersregarding serious diseases.

LA9

Health and safety topics covered in formal agreements with trade unions.



Occupational Health and
Safety/Status of Activities and Future
Initiatives

Training and Education
LA10

Average hours of training per year per employee by employee category.

-

LA11

Programs for skills management and lifelong learning that support thecontinued employability of employees and assist them in managing career
endings.

Human Resources
Development

LA12

Percentage of employees receiving regular performance and careerdevelopment reviews.

-

118

Furukawa Electric Group Sustainability Report 2014: Web version

Diversity and Equal Opportunity
LA13

Composition of governance bodies and breakdown of employees percategory according to gender, age group, minority group membership, andother indicators of diversity.

LA14

Ratio of basic salary of men to women by employee category.



Employee Data
Book/Furukawa Electric Data
Employee Data
Book/Furukawa Electric Data

Human Rights
Management Approach
Investment and Procurement Practices
HR1

Percentage and total number of significant investment agreements that
include human rights clauses or that have undergone human rights
screening.

HR2

Percentage of significant suppliers and contractors that have undergone
screening on human rights and actions taken.



Relations with Business
Partners/Partner Meetings and Partner
Evaluation Scheme

HR3

Total hours of employee training on policies and procedures concerning 
aspects of human rights that are relevant to operations, including thepercentage of employees trained.
Compliance/Training andRaising Awareness among Employees-

Human Rights AwarenessNon-discrimination
HR4

Total number of incidents of discrimination and actions taken.



Human Rights Awareness

Freedom of Association and Collective Bargaining
HR5

Operations identified in which the right to exercise freedom of associationand collective bargaining may be at significant risk, and actions taken to
support these rights.

-

Child Labor
HR6

Operations identified as having significant risk for incidents of child labor,
and measures taken to contribute to the elimination of child labor.

-

Forced and Compulsory Labor
HR7

Operations identified as having significant risk for incidents of forced orcompulsory labor, and measures to contribute to the elimination of forced orcompulsory labor.

-

Security Practices
HR8

Percentage of security personnel trained in the organization's policies orprocedures concerning aspects of human rights that are relevant tooperations.

-Indigenous Rights
HR9

Total number of incidents of violations involving rights of indigenous people
and actions taken.

-

Society
Management Approach
Community
SO1

Nature, scope, and effectiveness of any programs and practices thatassess and manage the impacts of operations on communities, including
entering, operating, and exiting.

-Corruption
SO2

Percentage and total number of business units analyzed for risks related tocorruption.

-

SO3

Percentage of employees trained in organization's anti-corruption policies
and procedures.

Compliance/Training andRaising Awareness among Employees

SO4

Actions taken in response to incidents of corruption.



Activities

Compliance/Compliance

Public Policy
SO5

Public policy positions and participation in public policy development and 
119

Relations with Public PolicyFurukawa Electric Group Sustainability Report 2014: Web version

lobbying.
SO6

Total value of financial and in-kind contributions to political parties,
politicians, and related institutions by country.

-

Anti-Competitive Behavior
SO7

Total number of legal actions for anticompetitive behavior, anti-trust, and 
monopoly practices and their outcomes.

Activities

Compliance/Compliance

Compliance
SO8

Monetary value of significant fines and total number of non-monetary
sanctions for noncompliance with laws and regulations.

-

Product Responsibility
Management Approach
Customer Health and Safety
PR1

Life cycle stages in which health and safety impacts of products andservices are assessed for improvement, and percentage of significant
products and services categories subject to such procedures.

PR2

Total number of incidents of non-compliance with regulations and voluntary
codes concerning health and safety impacts of products and services
during their life cycle, by type of outcomes.



Relations with Customers-

Product and Service Labeling
PR3

Type of product and service information required by procedures, and
percentage of significant products and services subject to such information
requirements.

PR4

Total number of incidents of non-compliance with regulations and voluntary
codes concerning product and service information and labeling, by type ofoutcomes.

PR5

Practices related to customer satisfaction, including results of surveys
measuring customer satisfaction.

Products-



Relations with Customers

Marketing Communications
PR6

Programs for adherence to laws, standards, and voluntary codes related tomarketing communications, including advertising, promotion, andsponsorship.

-

PR7

Total number of incidents of non-compliance with regulations and voluntary
codes concerning marketing communications, including advertising,promotion, and sponsorship by type of outcomes.

-

Customer Privacy
PR8

Total number of substantiated complaints regarding breaches of customer
privacy and losses of customer data.

-

Compliance
PR9

Monetary value of significant fines for noncompliance with laws andregulations concerning the provision and use of products and services.

120

Environmentally Friendly-