SUSTAINABILITYREPORT
2020 -2021
Taking the Excitement of Fashion Into the Future,

CORPORATE IDENTITYMISSION

Fashion that inspires you.

Fashion that creates a vibrant community.
Fashion for living your best life.

VISION
Joyful options galore!

VALUESWe always act with our customers in mind.

Taking on new challenges enables us to grow and evolve.
We value diversity and progressing as a team.
Contributing to society by helping others.
Making everyday life an adventure.

Corporate Philosophy
Be a person needed, Be a company needed.

MESSAGE FROM TOP MANAGEMENT
Aiming to Be a Person Needed, Be a Company Needed,
as We Confront Attitudes About Afﬂuence That Change With the Times
Social conditions have been changing rapidly in recent years.
Torrential rains, once described as a "once-in-a-decade downpour," havebecome an annual occurrence due to climate change. And the scale ofdisasters is becoming even more severe.
Digital technologies have spread rapidly and widely, becoming a core
part of our communication and daily lives.
The COVID-19 pandemic has been another factor changing lifestyles andvalues regarding afﬂuence at an unprecedented speed.
Since our founding as a men's clothing retailer in Mito, Ibaraki Prefecture,
we have endeavored to enrich minds and lifestyles through fashion.
Every day, we consider what afﬂuence means to our customers as themeaning changes with social conditions. Ours is a history of change andevolution, no more so than in our transition to a casual clothing retailer
and shift to a specialty store retailer of private label apparel (SPA).
Our stance is and will ever remain to evolve always.
To be digital, global, and sustainable are important ideas under thecurrent social condition.
In terms of digital, we intend to evolve our own e-commerce channel into
a community in which anyone can post and share content, highlighting
what they like and connecting with others.
In terms of global development, we are constructing a system tounderstand deeply the trends and needs in each region, creating newvalue together with local communities.
In terms of sustainability, the fashion industry has long been said to be

Chairman of The Board Michio Fukuda

an industry having a high impact on society and the global environment.
Reducing the environmental impact from production process andensuring transparency in the labour environment are issues we all must
address. We must look closely at old practices and business models.
These issues cannot be solved by individual companies alone. The
industry must come together and create new ideas beyond the boundaries of industries and companies.
In particular, we believe that overstocking and work-style reform forsalesperson are urgent and important issues.
We must deliver products that are truly valuable to our customers at theright time, at the right price, and in the right quantity.
We must create environments that eliminate excessiveness and waste inwork styles—environments in which employees look forward to working
every day.
We also want to solve issues through our core business while keeping aneye on the changing values of new society.
Be a Person Needed, Be a Company Needed as stated in our Corporate
Philosophy will be achieved by facing changes in society and customers
in this way. By taking on challenges and making changes without fearing
failure.
We will continue to listen to the voices of society and move forward in ourefforts to ensure that the next generation and the generation after that
continue to Play fashion!

President Osamu Kimura01

SUSTAINABILITY POLICY

Taking the Excitement of Fashion
Into the Future.
Taking the Excitement of Fashion Into the Future.
Fashion has the power to make every day a positive one.
We strive to ensure that fashion will excite us all for years to come.
Let's have fun and begin where we can, for the sake of the environment,
humankind, and our communities.
Having fun is the best way to keep moving forward.

02

MATERIALITY
The society in which we operate presents many issues we must address to continue in business,
including global warming, demographic changes, and regional disparities.
We have identiﬁed three materialities to address as they relate to social issues and our businesses.
Our Vision

Materialities
We reduce the environmental
impact of our business and makethe world of fashion sustainable.

●

●

●

Protecting the Environment

Empowering People

We create an environment inwhich customers, employees, andstakeholders feel excitement
every day.

We coexist with local communities
and create new value together.

Growing With
Local Communities

●

●

●

●

Engage in manufacturing that leads
to the future
Balance environmental considerations
with business activities
Create a world without fashion waste

An organization that fosters diverse
individuals
A society in which people enjoy
fashion in their own way

Leverage fashion to revitalize regions
where our stores are locatedFoster sustainable development inproduction areas

Message From the Director in Charge of Sustainability
Our predecessor, Fukuda Co., Ltd., experienced bankruptcy due to thepost-war recession.
Our corporate philosophy, Be a Person Needed, Be a Company Needed,
was born from the lesson that we must meet the expectations of ourcustomers and society. If we are not a company needed in the world, thenwe will cease to exist.
Today, many companies talk about sustainability. For us at Adastria, sustainability is synonymous with continuing to be needed.
With this in mind, we identiﬁed materialities and a vision for activities toengage with under our Sustainability Policy.
We determined these materialities and visions after discussions with
Adastria Group's customers and employees, as well as external experts. We
also took into account the unique characteristics of Adastria.
We also set speciﬁc goals for each materiality, and I believe that we havealready proven our determination to move forward.
The fashion industry has been named as an industry with an enormous
environmental impact. Impacts include the amount of energy used in
manufacturing and the short product life cycle—factors that have become
international issues.

In addition, the division of labor results in a long and complex supply chain.
Ensuring supply chain transparency in our industry is another issue.
The Adastria business grows from a variety of interactions with society.
As we aim to be a needed company, we will continue to face social
challenges aforementioned, making positive efforts toward solutions.
These social issues go beyond the ability of a single company to fully
address. We must transcend corporate boundaries and take on these issues
as a united industry.
As one of the leading companies in
the industry, we are determined tosteer our ship toward a future in which
we continue always to Play fashion!

Director in Charge of Sustainability

Taiki Fukuda
03

COMPANY PROFILE
Basic Information
Company Name
Head Ofﬁce

CapitalRepresentative

Adastria Co., Ltd.
27th Floor, Shibuya Hikarie, 2-21-1,
Shibuya, Shibuya-ku, Tokyo, Japan
October 22, 1953

Founded¥2,660 million
Michio Fukuda,
Representative Director andChairman of the Board●

30 + Brands

Food

LifestyleMulti-Brand

LeisureBeautyLearning●

ApparelHealth●Stores1,400
Mainland
China

1,332

14storesstoresTaiwan41stores12.7

Employees

10,786(Including)Full-Time Employees

online stores*As of February 2021

108

5,701

Fixed-term Employees

5,085

STAFF BOARD
Posting Styling Content

Participating Staff

million(As of August 2021; +1 million YoY)

Online Sales Composition
Japan Online Sales

53.8(+23.4% YoY)

U.S.
10stores●

Members●●*As of February 2021

Japan

3storesHong Kong

Target Zone

We deliver exciting products to customersof all ages and preferences, fromchildren's clothing to brands for theseniors, striving to be relevant for ourcustomers' entire lives.

billion yen

Onlinebrick-and-mortar
shops

30%

70%

Online Sales Composition*As of February 2021

687

3,100

FYE 2/2020

FYE 2/2021

Participating Stores

494

1,200

*As of March 2021
04

SUPPLY CHAIN
Sustainability in the Supply Chain
We strive for sustainable business operations and sustainable societies in every business process,including product planning, raw material procurement, sale, and product use.

Planning

Production Process

SewingImportLogistics▶ P6

Developing Sustainable Materials

Conducting Efﬁcient Shipping

▶ P7

▶ P9

Engaging in Appropriate
Production Volume

Using
Environmentally
Friendly Materials▶P8

Reducing Fashion Waste▶P10・P11

Using Energy▶ P9

Empowering
PeopleAfter-SaleBringing Visibility to
Our Environmental
Impacts▶ P7

Using Sustainable Materials

Protecting theEnvironment

Sale

▶P9

Pursuing
Businesses
for Diverse
Customers

Conducting
Efﬁcient
Shipping

Ensuring Ethical Procurement▶ P19

▶ P9

▶ P15

Changing Work
Styles for a Diverse
Workforce andChanging Times▶P13・P14
Promoting Career
Advancement for Women▶P14
Pursuing Businesses for
Diverse Customers▶P15

Engaging in Community-Rooted
Sales Activities

Growing With
Local
Communities▶

Fashion Waste

P17

Reducing
Fashion
Waste▶P10・P11

Climate Change
Diversity

Ensuring Transparency in Production

Resource Consumption

Work-Style Reform

Social Issues Faced by the Fashion Industry
05

Protecting the Environment
Before our products and services reach customers, we use a considerable amount of resources, including water and energy.
Further, the fashion industry as a whole faces many issues that must be addressed.
These issues include fashion waste (clothing disposal) due to mass production and mass consumption,
as well as biodiversity conservation.
As climate change problems become more serious, companies are expected to take measures to reduce environmental
impact. Given this situation, demands are rising for us to review how we conduct our businesses.
In addition to reducing the environmental impact of our business activities,
we also strive to encourage the enjoyment of sustainable fashion.
VISION

Manufacturing That Leads to the Future
As part of our efforts to reduce the environmental impact of our business, we review the materials and processing methods behind
our products to ensure sustainable manufacturing.
Our Group Procurement Guidelines deﬁne the group's procurement policy and the matters with which we expect our suppliers tocomply. These guidelines also state the necessity of reducing environmental impact and preventing pollution.
With the cooperation of our suppliers, we continue to give due consideration to the environment throughout our supply chain.

CASE

01

Sustainable Materials

Sustainable Mark

Sustainable Cotton

We have created our own deﬁnition of sustainability with respect toeach raw material, particularly for cotton, polyester, and rayon, which
we use quite frequently. We sell products that feature our own original
sustainable mark on the tag of products that meet our speciﬁed
content rates.
We use the A Mark on products that use sustainable materials but do
not meet our deﬁned content ratios. We also use the A Mark on
products that incorporate environmentally friendly processing andeco-friendly components.
Since we began this initiative in December 2020, it has grown to thepoint where about 20% of all apparel products carry one of these marks.

We use a considerable amount of cotton in our products.
As part of our commitment to procure sustainable cotton, an essential
raw material for our products, we aim to incorporate sustainable cotton
in all cotton-based products by the year 2025.
We participate in Cotton2040, a global initiative to support thetransition to a sustainable global cotton industry, striving to achieve thegoals of this movement.
Sustainable Mark Product Ratios

Increased to 20%
Cotton Mark

December2020
LaunchRayon MarkA MarkPolyester Mark

*Period: December 2020 to July 2021
*Results for apparel products only

BAYFLOW Sustainability
BAYFLOW's brand philosophy is Respect Nature, Respect Fashion. Under this philosophy, thebrand has long been involved in activities that value nature, including beach cleanup events andthe sales of denim made from environmentally friendly production methods.
In spring 2021, the brand began pursuing a goal to shift all womenswear and menswear items(with certain exceptions) to sustainable products. The brand also sells a large number of products
made from environmentally friendly materials and processing.

06

Protecting the Environment

CASE

02

Developing Sustainable Raw Materials

We develop our own environmentally friendly raw materials.These materials include UDR(z), which is amaterial we developed in collaboration with Kurabo Industries Ltd., UDR(z) utilizes the CLEANSE antiviralfunctional ﬁber processing technology of Kurabo Industries in combination with environmentallyfriendly materials such as organic cotton and recycled polyester. Other products we developed thatfeature functionality and sustainability include miulisse, a blend of sustainable cotton and ultra-ﬁne,delicate micro-polyester in a unique ratio that offers comfort and privileged touch.

UDR(z)

Comments From the Manager in Charge of miulisse Development
The name miulisse is a combination of "miu," another name for micro, and "lisse," smoothness in French. This material ischaracterized by its comfort and luxurious feel.
While made of high quality raw materials, we determined the ratio and design of the material to ensure affordability.
In developing this material, we speciﬁed sustainably grown cotton in consideration of the environment.
We intend to continue producing materials that satisfy as many customers as possible.
Kazuhiro Togame, Materials Development Department, Production Division

CASE

03

miulisse

Bringing Visibility to Environmental Impact

ADOORLINK CO., LTD's lifestyle brand O0u debuted in March 2021.
ADOORLINK is a subsidiary we established to achieve sustainable
societies and circular apparel economies.
Focusing on environmentally friendly materials and manufacturing
technologies, the brand discloses CO₂ emissions and water
consumption for each product based on information related to raw
materials. The brand discloses the degree of impact on environmental
issues using marks that indicate one of three levels.
The brand reduces the number of samples produced by using 3DCG
technology for designs and patterns. Highly accurate demand
forecasting via AI ensures optimal production.

Environmental Impact Ratios Compared to Common Materials
Global Warming

We minimize
greenhouse gas
emissions in the
manufacture of our
products

CO₂ Emissions 3.1kg
Reduction equivalent to
two cedar trees

Resource Depletion
Water Consumption 15.8 L
Reduction equivalent tothree plastic bottles

We must do better
at using resources
effectively.

Water Shortage

We use aminimum amountof water in the
manufacture of
our products.
Water Pollution

We minimize waterpollution in the
manufacture of our
products.

Comments From the Manager in Charge of O0u Development
The brand name O0u is a combination of letters and numbers that represent the cycle of O and 0, as well as u(you) who interacts with the brand.As the brand name suggests, customers participate in creating sustainable
and recycling-oriented societies by wearing O0u items.This is our aim.
We hope everyone interacts with sustainability and helps to improve the future one step at a time, without
the need for excessive efforts.It is our ideal that we co-create this brand with consumers.

CASE

04

Building Organizational AwarenessWe believe that the knowledge and understanding of employees involved in the planning and production of
products is important for sustainable manufacturing, and we hold seminars every year for these individuals.
We also provide opportunities for employees, mainly salesperson, to experience organic Japanese cotton
cultivation at the NPO Watarase Eco Village.
Internal Seminars on Sustainability
Sustainability Seminars

FYE February ・Background・Nomenclature guidelines for environment- and human rights-friendly products
2020
・What is Sustainable Raw Materials Procurement?
Presentation on the proactive use of sustainable materials

FYE February ・Our Policy and the Necessity of Sustainable Raw Materials
2021
・Operational Guidelines for Sustainable Raw Materials

Participants

323

3,731

views
*Total number of views
via online streaming

Internal Seminar (2019)07

Protecting the Environment
VISION

Balancing Environmental Considerations and Sales Activities
To make our businesses sustainable, we must consider the environment in the process of delivering products and services to our customers.
Our goal is to achieve well-balanced operations that give equal consideration to business and the environment.
First, we review efforts in the product procurement process and store operations. Working together with employees and customers,
we begin with the things that are closest at hand, moving forward one step at a time.

CASE

01

Encouraging Sustainable Shopping Style

As one means to conserve resources, we conduct the REBAG PROJECT topromote the use of My Bags (reusable shopping bags).We give members points
when they opt not to use disposable shopping bags. In addition, 830,000
people participated in the REBAG Shukan program we sponsored during ﬁscal
2020. During this program, we doubled the number of points given for a limited
period of time. Our efforts have resulted in a cumulative reduction of 4.49
million shopping bags over the six years leading up to ﬁscal 2020.
Through these efforts, we hope to work together with our customers to create
sustainable shopping styles that avoid the use of disposable resources.

No. of Bags
(10,000 bags)
300

We sell a wide variety of functional and well-designed eco-bags at eachof our group stores. Eco-bags offer a new approach to use, featuring
different themes (daily carry, wash and reuse, etc.) for customers toshow off their style coordinated with their look of the day.

We actively communicate via social media to encourage consumers enjoy
adopting sustainable fashion in their daily lives.
Each of our employees thinks about and designs ways to co-create new
shopping styles. These ideas include sharing videos on how to store packableeco-bags properly and unique styling recommendations incorporating My
Bag (personal shopping bag) with the brand (=REBAG STYLE).

Eco-Bag Made From Scrap Wood (GLOBAL WORK)

CASE

02

Shopping Bag Reduction
2,771,203

250
200
150
100
50
0

377,173
157,792 245,885 297,879

636,978

FYE 2/2016 FYE 2/2017 FYE2/2018 FYE2/2019 FYE2/2020 FYE2/2021

Proposing REBAG STYLE

Social Media Communications

Using Environmentally Friendly Materials

In addition to using environmentally friendly materials in the products themselves, we are switching gradually to environmentally friendly
components used in product delivery, including tags, shoe boxes, wrapping paper, and shopping bags.

Shopping Bag Made of FSC-Certiﬁed Paper andBiodegradable Corn Rope (LOWRYS FARM)

Shoe Boxes Made of 100% Recycled Paper

Packaging Materials Made From Biomass
Materials and Recycled Paper Cardboard (O0u)

Cups Made From Sugar Cane Straw andRecycled PET Resin (BAYFLOW Cafe)

08

Protecting the Environment
CASE

03 More Efficient Energy Use and Transportation

We have implemented various measures to use energy efﬁciently and to reduce CO₂ emissions.
In our stores, we are switching gradually to LED lighting and working with the Tokyo Head Ofﬁce
to reduce the amount of electricity used per unit of ﬂoor space, as we monitor annual electricity
consumption.
In addition to installing solar panels in some distribution centers, we aim to use energy more
efﬁciently by optimizing transportation plans and collaborating with delivery companies.
FY2019FY2020Electricity Usage 1,000kWh

36,25923,542CO2 Emissions

16,246

10,298

Electricity Usage 1,000kWh

1,342

1,035

CO2 Emissions

582

449

Category
Stores
Head
Ofﬁce

Unit

t-CO2et-CO2e

5.2%

2.2%

92.6%

Electricity Usage per Unit of Floor Space(3.3 square meters)

500

StoresHead Office■ Stores With LED Lighting■ Stores With Mix of LED &
Non-LED Lighting■ Stores Without LED Lighting*Results for domestic group stores*As of February 2021

Ratio of Stores Converted to LED Lighting

442kWh/3.3m²

393kWh/3.3m²

333kWh/3.3m²

257kWh/3.3m²

FY2019FY2020*Adastria non-consolidated*Period: April 2019 to March 2020; April 2020 to March 2021
*We calculate CO₂ emissions using the emission factors provided under the Ministerial Ordinance Concerning Calculation of Greenhouse Gas
Emissions Associated with Business Activities of Speciﬁed Emitters (calculated using the basic emission factors for each ﬁscal year of general powertransmission and distribution companies that supply electricity in the areas where the ofﬁces and plants subject to the calculation are located).
*The amount of electricity used in stores includes the amount of energy used for air conditioning.
*For certain stores where the amount of electricity used is unknown, we calculate and estimate the emissions intensity per ﬂoor area unit of the store.

Solar Power Generation Panels(Ibaraki Nishi Distribution Center)

Jamba, a smoothie and juice specialty store from California, U.S.A.
Jamba, a smoothie and juice specialty store from California, USA, is operated by
ADASTRIA eat Creations. The store sells smoothies made from frozen fruits,
vegetables and 100% juice concentrate, focusing on natural products with noartiﬁcial colors, artiﬁcial ﬂavors, artiﬁcial sweeteners, or dextrose sugar. Only
natural ingredients are used.
The newly opened Jamba Kitchen Labo GRANSTA MARUNOUCHI offers a varietyof choices to suit diverse dietary habits, including plant-based, gluten-free andvegan, soy meat, and plant-based milk.

VISION

Create a world without fashion waste
Fashion waste (clothing disposal) is an important issue to address, as it leads to CO₂ emissions from excessive resource consumption andincineration.
We have made it our policy to eliminate clothing incineration, and we pursue a variety of initiatives to prevent burning and disposal.
In addition to our goal of making products in the correct amount to avoid overproduction, we also strive to ﬁnd new ways to use andrecycle products that are no longer sold.
These efforts will lead to the proper use of resources and the reduction of CO₂ emissions.

CASE

01

Engaging in Appropriate Production Volume

Based on our policy of right time, right price, right quantity, we manage purchasing plans and inventory toensure we deliver exciting products to customers at the right time, at the right price, and in the right quantity.
In addition to consistent open to buy (OTB) management (i.e., purchase plans are based on the remaining
inventory according to sales) management and the management of products on a single item basis, we makeappropriate decisions regarding add-on orders and purchase restraints. In this way, we control inventory
volume and prices by curbing excessive discounts and sales.
We improve order accuracy by utilizing pre-order data received through our ofﬁcial online store .st.
.st Website Pre-Orders.

09Protecting the Environment
CASE

02

Clothing Reuse

With the cooperation of our partners, we recycle and reuse items that have reached
the end of their sales life, endeavoring to eliminate the incineration and disposal ofclothing inventory.
Certain items are used in new business projects, including our KIDSROBE business, achildren's clothing sharing service, and in FROMSTOCK, an upcycling brand.
We have also set up a system to use end-of-sales life clothing as relief supplies in theevent of a large-scale natural disaster.

Recycling and Reuse of End-of-Life Inventory

Reuse in New Businesses

Disaster Relief

1.1%

13.8%

0.9%

Recycle■Recycle■Reuse■Reuse in

84.2%
Reuse

New Businesses■Disaster Relief*Adastria non-consolidated results*March 2020 to February 2021

FROMSTOCK Dyeing Process

We are delevoping the FROMSTOCK upcycling brand, which utilizes certain productsthat have reached the end of their sales lives. FROMSTOCK puts these clothes
through a low-loss black-dyeing process to give these products new life.
Different types of dyes are used according to the material and characteristics of theclothes. Even if the clothes happen to have been damaged by snags or stains, thenew products offer unique textures.

CASE

03

Before Dyeing

Apparel Collection and Recycling: Play Cycle!

Play Cycle! is an Adastria environmental initiative to collect unwanted clothing from
customers and recycle or reuse the clothing as a new resource.
The clothing collected is recycled into raw material for polyester or down by partners,
after which the materials are reused by the KIDSROBE children’s clothing sharing service.
We aim to create an environment in which consumers can recycle clothing easily at any
time and any place. At present, we collect clothing at 102 stores in Japan, including
GLOBAL WORK locations.

Play Cycle! Collections

Weight (t)No. of Items (10,000)
WeightNo. of Items

10

17,13529,418

5.7

3

2

9.8
1,125

27,072

14,200

5

0

The Play Cycle! program collaborates with a variety of companies and local schools.
In January 2021, the program collaborated with B.LEAGUE Hope, a social responsibility
activity of the B.LEAGUE professional basketball league, to collect clothing at the
B.LEAGUE ALL-STAR GAME 2021 in Mito.
In summer 2021, the program collaborated with highschools in Mito City, Ibaraki Prefecture, and elementary
schools in Yokohama City, Kanagawa Prefecture, to collectunwanted clothing. Our activities through Play Cycle!
continue to expand beyond the boundaries of fashion.

After Dyeing

9

1

4.7

0.4

FYE 2/2017 FYE 2/2018 FYE 2/2019 FYE 2/2020 FYE 2/2021

Collecting Clothing at an Elementary School

Co-founding the JAPAN SUSTAINABLE FASHION ALLIANCE
The Japan Sustainable Fashion Alliance was established by leading Japanese textile manufacturers, trading companies, retailers, and recyclers to understand theimpact of the fashion industry on the natural environment and society, fostering collaborative solutions to common issues in the industry.
The alliance aims to achieve zero fashion loss and carbon neutrality by the year 2050 through appropriate production, purchasing, and recycling, while also proposing
policies to achieve these goals.

10

Protecting the Environment
STAKEHOLDER DISCUSSION

How to Deal With Fashion Loss Effectively?
In February 2021, we held a stakeholder discussion at the Adastria head ofﬁce. The topic of the discussion was Thinking About Fashion Waste.
Participants discussed new ways in which Adastria can improve to create a world without fashion waste.
Here, we highlight some of the remarkable comments we received about the industry and social approaches from people familiar withthe environment and the fashion industry.

Tsuyoshi Fukuya

Shuichi Takizawa

Io Takemura

Takahiro Okano

Participant Profiles▶

Mr. Shuichi Takizawa

Part of the comedian duo Machine Guns
Mr. Takizawa has also worked in the past asa janitor for a garbage collection company.

▶

Ms. Io Takemura

Co-Chairperson of unisteps, Fashion
Revolution Japan Branch▶

Mr. Takahiro Okano

Director, Ofﬁce for the Promotion of Hot Springs Land
Protection and Utilization, Nature Conservation
Department, Nature Conservation Bureau, Ministry of theEnvironment *As of the time of this dialogue

Shuichi Takizawa

Even if consumers recycle or reuse clothing, rather than throwing it out, thepaths leading to the next step are narrow and few in number.
I think this is the ﬁrst issue that must be addressed.
Systems will be required in the future to communicate this process after
recycling and reuse in a manner easy to understand. These communications
might include how clothes are actually used and their ﬁnal use.
I also think it would be better to offer a more convenient clothing collection system in which everyone can participate easily.For example, one could
attempt to build an infrastructure based on mechanisms from the collection
to the ﬁnal utilization of clothing.
If would be difﬁcult for a company to achieve this on its own. One way
forward would be for multiple companies to work together in building asystem.
Through this discussion, I came to feel that consumers are also looking foran environment that eliminates waste. This could be achieved if the entire
industry came together.
●●

Takahiro Okano

An approach focused on the order stage to control the number andproduce a correct amount of products is very promising.
I think examples should be disclosed more widely...simulations of sales
forecasts, production volume adjustments based on pre-orders, etc.
If consumers see Adastria’s stance in identifying needs and dealing with theissue of fashion waste in partnership, then I think these consumers who buy
Adastria products will take better care of their clothes.
Mass production, mass consumption, and mass disposal in the fashionindustry are issues that cannot be overlooked from a social perspective.
Some data shows that even though production numbers have increased,
the size of the market is shrinking.
To solve this issue, we must make a fundamental change to existing
business practices, including lowering product prices.
This is an issue that must be addressed on a united front by the fashionindustry, and I encourage the government to become involved as well.
●●▶

Mr. Tsuyoshi Fukuya

President and Representative Director,
WEFABRIK Co.
Mr. Fukuya participated in the dialogue remotely.

Io Takemura

I found the upcycling brand FROMSTOCK very interesting. The brand dyes
unused clothes black and gives them a new live, ready for resale. However,using a system that offers consumers the chance to enjoy the differences
between each article of clothing could be better in the end.
Rather than offering a standard value of buying black-dyed clothing, thebrand could communicate the unique value of clothing dyed in various
colors and the attraction of owning distinctive, one-of-a-kind articles.
Maintaining transparency is a basic principle in manufacturing.
The reality, however, is that very few companies ensure transparency, notonly with respect to the products themselves, but also with respect to theraw materials, manufacturing workers and environment, and sales process.
This is why I would like to see Adastria and other companies be more proactive in communicating about their manufacturing processes and their works
as a company.
Consumers should be made aware of good initiatives for the industry andsociety, no matter how trivial or incomplete. A platform to communicate
easily with consumers would help change social awareness.
●●

Tsuyoshi Fukuya

I have come to understand that solving fashion loss requires an increased
number of “exit options” beyond recycling and reuse.
This is just one example, but what about taking on the challenge of off-pricestores, taking advantage of Adastria’ s strength of operating various brands
nationwide?
Since there is no precedent, I think it could have a positive impact onsociety and help solve the fashion waste problem.
In 2020, we implemented a sustainable style project with SMASELL,
Mode Gakuen, and Adastria.
The project was designed to provide sample products from Adastria asteaching materials at Mode Gakuen to help students learn about the issueof waste loss. I feel that it is important to continue to increase the numberof such cases of industry-academia collaboration.
As corporations become more actively involved in the ﬁeld of education,these activities will lead to the education of the next generation.
I hope to see more such opportunities in the future.
●

●

11

Encourage People to Shine
Our business is supported by many people, including our customers and employees.
With the declining birthrate and aging population in Japan, diversifying customer needs, and ever-changing times and values,
the role that we as a company need to play and the products and services that we provide continue to change.
At Adastria, we believe that it is our responsibility to support all people through our business, enabling them to enjoy theirlives and careers through fashion.
VISIONAn Organization That Develops and Grows Diverse Personalities
One of our corporate identity values is the value of diversity. We respect and recognize diversity regardless of age, gender, nationality,
disability, sexual orientation, etc.
We have incorporated organizational diversiﬁcation into our management strategies, and we pursue initiatives to create an environment andstructures that support employee careers and allow employees to fully express their talents.
We believe that each and every employee will be able to leverage their unique strengths, and this will lead to active discussion and innovation with new perspectives, and to the mid- to long-term growth of the company.
We implement work-style reforms, improve internal systems, provide human resources development, and employ persons with disabilities
to ensure customers, employees, and others ﬁnd greater levels of job satisfaction and health both physically and mentally.

CASE

01 A System That Allows Employees to be Healthy and Active in Their Own Way

We believe that allowing our employees to have control of their own work
styles as their careers and life stages undergo transitions, and allowing
them to continue working with satisfaction for a long time, will lead toincreased productivity, more role models for employees to learn from, andcorporate growth.
We endeavor to provide a proper work-life balance for our employees by
Percentage of employees taking paid holidays

64.6

%

Percentage of employees taking childcare leave

98.1

%

(Percentage of male employees taking childcare leave: 2.67%)

allowing them to take paid leave in half-day increments and promoting
the use of annual paid leave. Through maternity and childcare leave
programs, nursing care leave, and job returns (re-employment after retirement), we also work to create a system that allows employees to be active
regardless of their age or life plans.

Percentage of employees taking maternity leave

99.6

%

*Adastria (non-consolidated)

Percentage of employees returning towork after childcare leave

98.3

%

Average monthly overtime hours per
employee

6.2

hours

Average number of days of nursing
care leave taken

119

days

*FYE 2/2021
Target: Domestic group company results

12

Empowering People
CASE

02

A Diverse Workforce

The Adastria Group employs a diverse mix of people with different cultures,backgrounds, values, and lifestyles, including those with disabilities, foreign
nationals, and those taking on shorter hours while raising children, all working
together with great vigor.

For employees to embrace the individualities and differences of their peers andgrow together, we hold lectures for management that teach the effects of diversity within organizations. We do our utmost to create a system and environmentthat enables employees to fully utilize their individual characteristics.

Being Excited for Change, Hoping to Contribute to the Growth of People and Communities

By developing and retaining the human resources that support the company, we hope to create a ﬂexible and strong organizationthat can respond to major changes in the global society, as well as satisfy the needs and improve the lifestyles of local customers.
Aiming to provide employees longtime employment with trust and security in their work, we have also introduced a training system
in Taiwan, and have started reviewing our evaluation system.
We hope to contribute to the further evolution of the Group by developing human resources who can work globally for a long time.

President and Representative Director, Adastria Taiwan Yvonne Lin

Number of Foreign
Employees

Total

94 people

Term
Employees

57

Full-Time
Employees andContract
Employees

37*As of February 2021
Target: Domestic group companies

Employee Training

Breakdown of employment of persons
with disabilities by job category

We held a leadership lecture
by a female director for malemanagers on the topic ofchanging the managerial
mindset.
150 male managers,
including those participating
online, deepened essential
knowledge andunderstanding of leadershipand diversity in an
organization.

The Adastria Group employment rate forpeople with disabilities is 2.38%, and 194
staff members with disabilities are
employed. They make full use of theirindividual traits and abilities with themeticulous support of our special-purpose
subsidiary, Adastria General Support Co., Ltd.
In addition to business support which
includes administration and clerical work, weare expanding the scope of our activities
with back-room support for stores,
participation in new business projects, etc.

Total

194 people
7

Management DivisionpeopleLogistics

53

Administrative
Division

Store Support

60

74*As of May 2021
Target: Domestic group companies

Employee Roundtable Discussion

Only when your individuality shines
through can you Play fashion!
Wong: I'm from Hong Kong and have about eight years of experience in productplanning and e-commerce at a group company in Shanghai.
Since moving to Japan, I have been involved in the web business department
and the launch of O0u, a lifestyle brand that incorporates a sustainable perspective.
Employees of Adastria, no matter where they are from or what they do, share thesame common mission: "Play fashion!”
I think sharing the same sense of values is what allows us to take on new
challenges while overcoming differences in languages and ideas.
Kawasaki: Ever since I was a fresh graduate, stores have been my area of focus.
I took maternity and childcare leave and returned to work last year.
After returning to work, I took on the SSC challenge, an in-house roleplay competition held in ﬁscal 2020. Using my strengths in customer service, I was able to
win the competition.
Currently, I take on a variety of tasks in addition to store operations, including
planning, operational support, and customer service guidance.
Now that I work shorter hours, I can switch my mind on and off work more clearly
than before. I always think about how to maximize my performance in the limited
time I have.
Kanehara: The textile design team that I lead is made up of a diverse group ofpeople.
This diversity has a positive effect on the team as a whole.
Ms. Kawasaki is an example we can learn from. Like her, those who work shorter
hours work efﬁciently to avoid unnecessary and time-wasting work.
There is so much to discover and learn from the differences of each individual. I
think that being a diverse organization creates new insights and values that leadto the growth of the team.
Kawasaki: Age is one of the many traits that makes us unique.
With brands like Elura and Utao that target those in their 50s and 60s, not only do
we keep customers for a long time, but our employees remain active as they age

EluraMachiko Kawasaki

R&D ofﬁce

Hirokazu Kanehara

ADOORLINK

Jenny Wongand continue utilizing their unique strengths in customer service.
Wong: I've also noticed that in the last two years, workplaces have become morediverse.
Remote work and new digital technologies have given employees ﬂexibility inchoosing where and how they work, allowing them to suit their work to theirpreferred environment and lifestyle.
Kanehara: I believe that by creating a synergy between workers and fully
embracing the advantages of the web and the real world, we widen opportunities
for all our employees.
There are those that show great ingenuity in human resource development andcustomer service that is only made possible through real human interaction. There
are further yet those that communicate their unique styles on the staff board,illuminating us on new customer touchpoints.
I also believe that various new opportunities for people to utilize their uniquetraits are helping them express their individuality.
Kawasaki: Even employees with time restrictions on their work can play anactive role online. Expressing their individuality allows them to make a differencein the way they work.
Wong: This is not only about accepting differences, but it is also about creating aspace in which people can freely utilize their personal traits and demonstrate theirunique abilities.
I believe this will enable the individualities of our diverse group to shine through.
Kanehara: The ﬁrst step is to recognize, respect, and accept the differences
between all people.
By sharing and combining the experiences, knowledge, and ideas of diverse
employees that vary in areas such as gender, nationality, sexuality, and disabilities, we can create synergy and demonstrate our real strength.
The key to fulﬁlling our original mission to “Play fashion!” is for each and every
one of us to fully utilize our individuality, and shine as we bring indispensablevalue to the team.
13

Empowering People
CASE

03

Supporting Activities for Women

The Adastria Group considers the promotion of activities for women, who
account for more than half of its employees, to be one of the key issues in its
diversity management. Under the commitment of management, the Group has
formulated a speciﬁc target and roadmap to raise the percentage of women insenior management positions to 30% or more by 2025.
Percentage of Women in Management Positions
50

Management Positions

30

34%

35%

33%

20

10
（%）

10%

13%

16%

2010年

2015年

2020年
Present

Target Percentage of
Women in Management
set by the Government

30%

30%

Leadership Lecture by Women Directors

10%

約

2025年

Target by 2025

Selected as a Quasi-Nadeshiko Brand for the ﬁrst time in 2020.

*Target: Domestic Group Companies

What it Means to Create an
Environment Where Each
Individual can Shine
General Manager, Public Relation Department

Yoko Kazama

An Environment Where Employees can Enjoy
Being Themselves Leads to Growth

As the General Manager of the Public Relations Department, my role is to makethe company activities and ideas known both internally and externally throughmedia relations and internal dissemination of messages from management, andto conduct communications that contribute to the business.
I try to see everything as a personal matter, treat others with respect and interest,04

Panel Discussion by the Female General Managers

Average Percentage of
Women in Management
Positions in JapaneseCompanies as of 2019

Interview of the Female
General Managers

CASE*The percentage of women employees in the consolidated domestic group is 75.1% (as of February 2021).

Senior Management Positions

45%

40

By taking advantage of the large number of women employees, we hope toincorporate ﬂexible and diverse perspectives into the decision-making process,develop products and improve the quality of services by taking advantage of thediversifying needs and unique perspectives of women, and generate mediumto long-term growth and new innovations for the company.

and respond ﬂexibly.
In a team of diverse people, there are many different values and ways of thinking.
This includes how people balance work life with family, their life stages, and theirapproaches to build their careers.
I prioritize daily dialogues among the group so that each member can effectively use
their individuality and come to understand what their personal approach ought to be.
I aim to create an environment in which each member brings indispensable value
to the team, and where they can receive support from those around them whenneeded.
Increasing the diversity of lifestyles and ways of thinking among the senior management positions, including the women, will lead to new perspectives, engaging
discussions, and a strong ability to make decisions. I believe this will also lead tomore fun product proposals and services that push the boundaries of fashion.
I will continue to communicate our exciting challenges to as many people aspossible. In doing so, more people both inside and outside the company will view
their involvement with Adastria as something fun and positive.

Adapting our Work Styles to the TimesThrough our ﬂextime and telework systems, we promote work styles that offer
employees ﬂexibility in choosing the time and place of their work. We havealso established personnel systems for changing career track positions andregional positions, allowing employees to take paid leave in half-day increments, and allowing employees to take on a side job. This gives them a varietyof careers and work styles to choose from that suit their life.
Additionally, to achieve a sustainable work style for store staff working in commercial facilities, we cooperated with Shin-Shizuoka Cenova in launching the
Mutual Support for Working Hours Project . This incorporates a business hours
Mutual Support for Working Hours Projectﬂextime system and a leave system that offers employees time off to replenish their energy when needed.
About 110 tenant companies and industry organizations participated, some
online, at our progress report meeting. They proposed sustainable work styles
for the entire industry.
As the way products are sold and purchased continues to change, we strengthen customer communication through digital technologies like SNS and live
streaming to expand opportunities for new sales and activities not bound by
location or time.

Number of Applications for Side Jobs

Breakdown of People in Elective Job Positions
Store Positions

80

128*As of February 2021

Limited-Area Career-Track
Positions
Positions

1,887

2,472

*Target:Domestic Group Companies (excluding executive ofﬁcers)

14

Empowering People
VISIONA society in which people enjoy fashion in their own way
As customer needs become increasingly diverse, we develop products and services in multiple categories and under multiple brands
to satisfy as many tastes as possible.
We use customer service as a means to offer products that match customer needs. In addition, we offer designs and looks that are not
restricted by gender, providing fashion that allows people to enjoy differences in age, appearance, and personality. In this way, we
strive to empower people.

CASE

01

Pursuing Businesses for Diverse Customers

Inclusive fashion is our ideal as we aim to create societies in which all
enjoy comfortable fashion and the chance to be themselves.
Play fashion! for ALL is an inclusive fashion service that offers fashion for all
from a variety of perspectives. We launched this idea in response to a
proposal by an employee submitted to our Project A internal business idea
program.
「Play fashion！ for ALL」
Project Manager
InterviewMarketing Division

Serina Banno

Creating Societies for All to Enjoy Fashion MorePlay fashion! for ALL is a concept aiming to standardize fashion, while also
supporting the idea that fashion is obviously unique to each individual.
My father was in and out of the hospital repeatedly during a 20-year battlewith illness. In the last six months of his life, he required extensive nursing care.
When I look back on the six months he spent bedridden, I regret that we
didn’ t do more to help him enjoy fashion and be himself, even during his

unfortunate situation.
We should be able to look forward to daily wear and what look we want to try
next. The same goes for people who are undergoing nursing care or who havedisabilities.
If we can create societies like this, every person will have more fun fashion
options every day.
I worked with three employees of the special subsidiary Adastria General
Support in this project. We discussed their respective issues and developed
clothes that met their needs, which led to a crowdfunding project and sales on
the .st online store.
We moved forward with this project because we are a company with many
positive and enthusiastic employees who are willing to take on challenges andthink together.
Ten years from now, I would like to see a fashion industry that treats inclusive
fashion as the norm.

Style Preference and Comfort at the Same Time

Thinking solely about comfort without considering style preferences results in apparel the consumer
won't wear.
I faced this dilemma personally because I am a fashion enthusiast.
I am happy that we created apparel through this project that represents exactly what the customer wants.
With just a little ingenuity, such as changing the length or sewing method, we produced fashionableapparel that offers favorite looks with more comfort.
I hope this will be the start of a wider range of fashion options for wheelchair users.

Project Member, Yamagata Support Center, Adastria General Support Daisuke Suzuki

FOR I SERIES is apparel for slender adult women
who love their own individuality
The Heather mini, developed for
petite women based on
feedback from staff

PAGEBOYLIM, a genderless brand transcending
age and gender that offers the joy of freedom
FOR I SERIES is apparel for slender adult women
who love their own individuality

Casual Wear for Wheelchair Users
Corduroy Shirt With Sleeve Patches

CO-FUKU Mask 2020
We participate in CO-FUKU Mask 2020, a workshop supported by Shibuya Ward. The
goal of this workshop is to understand the problems faced by people with disabilities inconnection with masks, giving new shape to masks
through redesign.
Employees with disabilities and professionals suchas product planners and pattern makers are
participating in the project. The project producescollaboratively developed and commercialized
masks and mask cases that are easy to put on andtake off from the perspective of caregivers. Masks
are available for purchase through the .st online
store, and the issue itself is gaining wider attention.
15

Empowering People
CASE

02

Encouraging an Understanding of Diversity

We engage in activities to educate society and provide services to ensure
everyone enjoys and is excited about fashion, empowering people to let theirindividuality shine through.
In addition to our support for the OUT IN JAPAN coming out project, we set up
booths at Tokyo Rainbow Pride and Kyushu Rainbow Pride events.

Beyond encouraging an understanding of the LGBTQ community, our efforts
provide opportunities to expand awareness of our participating brands and to
improve customer service skills by offering products more personalized toeach customer.

TOKYO RAINBOW PRIDEOUT IN JAPANTOKYO RAINBOW PRIDE（2018）

OUT IN JAPAN Photo Exhibition at the 21stCentury Museum of Contemporary Art, Kanazawa

CASE

03

OUT IN JAPAN
Crowdfunded Sponsor T-Shirt

Fostering the Next generation of Human Resources Through Fashion

We support young people who aspire to enter the fashion industry to foster
human resources of the future through our core businesses.
Since 2009, we have accepted junior and senior high school students for work
experience at our stores nationwide. Since 2020, we offer open company tours at
our Tokyo head ofﬁce to let students experience the product planning process,providing with opportunities to learn about store and head ofﬁce operations.

Creating opportunities to interact with young people allows our employees to gain
new ideas and perspectives, which they can apply to their work.
In ﬁscal 2020, we limited the number of students accepted due to the impact of
COVID-19. More recently, we began accepting students upon request.
We hope to continue contributing to the revitalization of the fashion industry bysupporting the dreams of young people.
Work Experience Participants(People)
200

176

150
100
50
0
(People)
100
80

64

48

68

2
FYE 2/ FYE 2/
2016
2017

FYE 2/
2018

FYE 2/ FYE 2/ FYE 2/
2019
2020
2021

Open Company Tour Participants
89

60

Open Company Tours for High School Students

In-Store Work Experience for Elementary School Students

40
20
0

99

19
FYE 2/ FYE 2/
2016
2017

12

24

38
10

FYE 2/ FYE 2/ FYE 2/ FYE 2/
2018
2019
2020
2021

Support for Medical Personnel

Industry-Academia Collaboration

As part of our support in ﬁghting the spread of COVID-19, we provided relief supplies
to the passengers and crew of the Diamond Princess in response to a request from
SEMA, the Emergency Disaster Response Alliance. Our JEANASIS brand sold charity
products and donated a portion of theproceeds to Peace Winds Japan, an
organization that supports medical personnel
working to respond to viral infections.

In collaboration with the Sustainable Style Project conducted by Osaka Mode Gakuen
and SMASELL, a company run by WEFABRIK Inc., we provided sample products
generated in the process of product planning for use as styling education materials.
Our participation in this industry-academia collaborative project supports students whowill be responsible for the future of the fashion industry, providing opportunities tounderstand the issues involved in clothing waste through practical experience.

16

Growing With Local Communities
We expand our business globally through store openings, product manufacturing, and distribution centers.
To continue offering the excitement of, we must take a glocal approach to understanding the needs and characteristics
of local communities, whether in Japan or overseas. We must use the power of fashion to build new value together
with the communities we serve.
We engage in corporate activities aiming to Be a person needed, Be a company needed, striving to revitalize regions
and develop societies through our business activities.
VISION

Leveraging Fashion to Revitalize Regions
Where Our Stores are Located
The relationships we build with local communities are very important to us as we open stores in Japan and overseas.
We aspire to be company with deep roots in each region, connecting with customers and local communities through fashion.
Each region faces different challenges, but we will continue in our efforts to contribute to job creation, to solve local issues through thepower of fashion, and to create new value.

CASE

01

Engaging in Community-Rooted Sales Activities

Under the branch system, we divide stores in Japan into six regions. We engage in store management according to
the characteristics of each region.
We also strive to build communities through fashion, sponsoring and participating in events related closely to eachregion. Our events are designed to accomplish regional revitalization and foster future generations.
Customers have shown favorable responses to brands incorporating local area collaborations, as well as initiatives thatmake the most of a nationwide network of stores. These initiatives also have the beneﬁt of motivating store staff.

Studio CLIP

Community EventsFYE 2/2020

9 locations

AEON MALL Kurashiki
FKD Interpark
Motoyawata Colton PlazaAEON MALL Takaoka
AEON MALL Okazaki
Tenjin Solaria PlazaAEON MALL Tsukuba
AEON MALL Hanyu
Shin-Shizuoka Cenova

FYE 2/2021

2 locations
AEON Lake Town
AEON MALL Okazaki*Fiscal 2020 events
limited due to COVID-19

Creating New Customer Experiences by
Focusing on Urban Mobility
Focusing on mobility surrounding store visits, we partnered with Luup, Inc. to install
LUUP charging ports in front of our stores. LUUP is an electric kickboard sharing
service for electric micromobility.
We provide new customer experiences from the aspect of urban mobility, making
considered responses to changes in society and our customers.

Localized Products
Our Asian business pursues the conceptof glocal as a main policy, establishingstrategies tailored to each region.
Our niko and ... SHANGHAI brand offers
items popular in Japan in color
variations meeting the needs ofcustomers in Shanghai. The brand alsooffers limited-edition designs.

Local Cleanup Activities
The BAYFLOW Kichijoji Store is leading the way in regular trash pickup activities inand around store prior to opening.
By inviting participants from neighboring stores, the circle of concern expands
naturally, leading to the revitalization of the entire city.

17

Growing With Local Communities
CASE

02

Contributing to the Region where We Were Founded

Since our founding in 1953 in Mito City, Ibaraki Prefecture, we havecontinued to grow with the support of the local community.
To ensure that we continue to grow together with the city in which wewere founded, we support the Mito Chamber Orchestra, act as an ofﬁcial
sponsor of the Ibaraki Robots (B.LEAGUE professional basketball team),sponsor collaborative marine environment conservation events with the
Oarai Aquarium in Ibaraki Prefecture, and provide athletic wear to the top
team of the Mito Hollyhock professional soccer club.

In addition to these activities, we contribute to the community throughfashion.
For the ﬁrst time, we designed the T-shirts distributed at the 6th Mitokomon Manyu Marathon.
The t-shirt is made from a fabric featuring excellent water absorbency andquick-drying properties, and designed with a pocket on the back of theright sleeve for store masks and other items.

mask pocket
Ibaraki Robots

CASE

03

T-Shirt for Participation in the 6th Mitokomon Manyu Marathon

Mito Chamber Orchestra

Contributing to Disaster-suffered Area Recovery Through Fashion

Adastria is a participating member in SEMA, a disaster emergency responsealliance. We established an internal system to ensure our products aredelivered in a timely manner as disaster relief supplies.
In ﬁscal 2020, we provided 9,942 of clothing to evacuation centers throughSEMA.
In addition, GLOBAL WORK donates a portion of sales of eligible products to
the Sakura Namiki Project of NPO Sakura Namiki Network, supporting
reconstruction efforts in affected areas through fashion.

Unloading Products at an Evacuation Center
Photo: Civic Force/A-PAD Japan/Peace Winds JapanGLOBAL WORK

Products Eligible for Sakura Namiki Project
Donations（GLOBAL WORK）

FYE 2/2020 Donations to Disaster-suffered Area Support
DisasterTyphoon No.19 (2019)
COVID-19 relief support

Support Provided
Relief supplies to evacuation centers (1,185 articles of clothing in total)

Donations to passengers on board the Diamond Princess (100 items of basic cosmetics/CLEIDO ET BICE)

Donation
3,401,560 yen
72,900 yen

FYE 2/2021 Donations to Disaster-suffered Area Support
DisasterHeavy Rainfall (July 2020)
Great East Japan Earthquake recovery support

Support Provided
Relief supplies to evacuation centers (total of 9,942 articles of clothing)

Donation from sales of eligible products to the Sakura Namiki Project (GLOBAL WORK)

Omiyage Project Shibuya Ward's Official
In 2018, we concluded a Shibuya Social Action Partner Agreement with Shibuya
Ward in Tokyo. Here, our aims were to contribute to the creation of an attractive
town, to solve community issues, and to achieve sustainable development throughour businesses.
In 2020, we participated in the ofﬁcial Shibuya Ward souvenir project, producing
T-shirts and tote bags as ofﬁcial souvenirs (omiyage) of Shibuya Ward.

Donation
9,209,994 yen
200,000 yen

Creating a Socially Distanced and Fashionable
Space in the Region of Our Founding
Hotel Terrace the Garden Mito is a hotel in Mito City, Ibaraki Prefecture. Here, we
installed mannequins inside the hotel wearing our branded clothes to create aspace in which people can enjoy social distancing during this time of COVID-19
pandemic.
We called this space, Play! Social
Distance. The scenes arereminiscent of the 1970s and1980s, when our stores wereplaces where students in Mito
City could interact with eachother. These settings reﬂect ourdesire to remain a part of thedaily lives of local residents.

18

Growing With Local Communities
VISION

Fostering Sustainable Development in Production Areas
We manufacture products in various regions around the world, supplied through an extensive supply chain, from procurement of raw
materials to sewing and trading.
Good partnerships with suppliers and the sustainable development of the production regions allows us to supply high-quality products
to our customers in a stable manner.
To provide even better products and services in the future, we established rules for fair and ethical transactions. We conduct our procurement activities in accordance with these rules.

CASE

01

Adastria Group Sourcing Policy and Sourcing Guidelines
consideration for the environment, and oppose corruption.
We translate this Sourcing Policy and guidelines into English and Chinese,
languages that are used often in the factories of our suppliers, to ensure awider understanding.
In addition to communicating the policy and guidelines internally, we ask our
suppliers to understand our approach and policies through presentations inJapan and annual factory conferences with our suppliers in China.

To procure and deliver products based on positive partnerships and a commitment to mutual development with suppliers, we established the AdastriaGroup Sourcing Policy. Under this policy, we strive for fair and ethical business
transactions.
We also formulated our Group Sourcing Guidelines, which incorporate humanrights, social risks, and environmental risks. These guidelines state that we
respect human rights, maintain a positive working environment, act with
Guideline Pledge Signees(Companies)

Group Sourcing Policy

742

677
589

Group Sourcing Guidelines

397

FYE 2/2018

CASE

02

FYE 2/2019

FYE 2/2020

FYE 2/2021

Presentation for Business Partners

Factory Monitoring
During ﬁscal 2020, the COVID-19 pandemic made it difﬁcult to visit overseas
factories from Japan. Therefore, we conducted our ﬁrst-ever online monitoring,
coordinated with personnel at overseas afﬁliates.
We also send a separate questionnaire regarding environmental aspects
speciﬁcally. The questionnaire covered topics that included energy and water
consumption. We also began working with suppliers to reduce our environmental impact in the supply chain.

Once suppliers agree with our Sourcing Guidelines, we ask them to cooperate
by ﬁlling out questionnaires based on the guidelines.
Based on the results of these questionnaires, our CSR procurement staff visit
factories directly to check on and monitor conditions.
If any issues are identiﬁed for improvement, we ask the supplier in question to
make changes based on direct and ongoing interactions.
We also prepare CSR procurement questionnaires for new suppliers to conﬁrm
that there are no problems before we begin doing business with them.
Production Department Background

Supplier BackgroundNumber of Factories
Monitored

Sourcing Guidelines Pledge

Factories
Monitored

Questionnaire
Factory Monitoring
Serious Deﬁciencies
Address Improvement With SuppliersInternal Monitoring Staff
Follow-Up
Excellent Factories
Certiﬁed Partner Factories

FYE 2/2017

9

FYE 2/2018

20

FYE 2/2019

26

FYE 2/2020

40

FYE 2/2021

13

Matters Identified in Factory Monitoring and Response(FYE 2/2021)
Conﬁdential
Measures Against Contamination Information
by Foreign Substances
Defective Products
1
Waste Materials
5 3
Water and Energy
Consumption

108*Downward trend during FYE 2/2021 due to the impact of COVID-19*Includes follow-up monitoring (re-audits)32

ChemicalSubstances

10

4

74
71
事務系

名

Working Environment
Including one matter
requiring improvement

6

Working Hours

3

Including one matter
requiring improvement

Employee
Healthand Safety

Workplace Accidents
Including one matter
requiring improvement25

Equipment andMachinery• First Aid Kits
Maintenance • Building and Facility Safety• Evacuation Drills• Health Management

919Growing With Local Communities
CASE

03

Partnership Certification

We certify factories that meet certain conditions as partner factories.
These factories have received and understood our sourcing policies andguidelines, respond to questionnaires, and participate in factory monitoring as measures to maintain positive partnerships with our production departments.
(Companies)
30

Partner certiﬁcation is also based on the quality of products, the frequency of defective products, and the status of social and environmental
performance. We award certiﬁcations at our annual factory conference.
To deliver quality products manufactured in improved environments, wewill continue partnership certiﬁcations working toward the year 2023.

Certified Partnership Factories

25

30

30

FYE 2/2020

FYE 2/2021

20
15
10
5
0

10
FYE 2/2019

Production Factory

Factory Conference

Partnership Factory Certiﬁcation

Interview
With Factory Monitoring
Supervisors in Shanghai, China
To build good partnerships and ensure smooth communication with factories, we assigned factory monitoring
personnel to our local subsidiary in Shanghai, China.
(From left) Ms. Wang (Huilei), Ms. Wang (Tao), Ms. Zhang

Zhang: I have been working as the local CSR procurement manager since2017, when Adastria began its factory monitoring system.
Wang (Huilei): Like Ms. Zhang, I work as a local CSR procurement manager.
I am in charge of the process that begins with scheduling factories prior tomonitoring, visiting and checking factories, and providing feedback
afterwards.
COVID-19 has made it difﬁcult for the Japanese staff to come to factories inperson, so we invite them to participate in the meetings with factory staff
online from Japan.
Wang (Tao): My main job is to manage product manufacturing and quality
control of products, so I visit factories frequently.
When the CSR procurement team goes to a factory under my purview, I
follow up on schedules and accompany them for on-site monitoring of thefactory environment.
Zhang: Everyone seems to enjoy working at the factory.
In the past, factory workers were generally younger people, but recently I see
many more experienced workers.
Many of Adastria Group clients are large factories. The factory owners
emphasize labor laws and provide better beneﬁts to their workers, which
provides a better work environment and encourages longer tenures.
Wang (Huilei): When I visit factories, I might ﬁnd certain issues that must be
addressed, such as broken ﬂooring.
At the end of the visit, we meet with the factory owner, and inform them
directly of the areas we identiﬁed for improvement. We ask the factory tocome up with a schedule and plan for improvement.
After our visit, we put the areas for improvement in writing and send to thefactory within the month for their records.
In most cases, improvements are made within three months.
It's not often that we ﬁnd critical areas for improvement. It's easier for thefactory to do its job if the improvements are made, so corrective actions aretaken relatively quickly.

When a major capital investment is involved, it may take six months or a year
to make improvements. We hand that work over to production managers like
Ms. Wang (Tao), with whom we work closely via site inspections and e-mailreports, etc., to ensure improvements are made over the long term.
Wang (Tao): When I visit factories as a production manager in the course of
my regular duties, I pay attention to whether items in the guidelines arebeing followed.
Before we began CSR procurement, we looked at factories from theperspective of quality and delivery. Now that we are engaged in CSR
procurement, we look closer at the working environment.
For example, are the air conditioners at the right temperature? Are workers
working long overtime hours?
We understand that production efﬁciency and quality improve when workers
operate in a comfortable environment.
Through ongoing communication, I build trust with the workers and otherpeople at the factory, which has made my day-to-day work smoother.
Factories do more than just make products; they are our partners, andI think this kind of communication is very important.
Zhang: When we monitor factories, we explain to them why it is necessary.
We also share best practices from other factories to encourage owners tocreate better environments on their own.
We let them know that we are not just performing audits, but that we are also
communicating with them to learn and grow together.
The important thing is not to impose, but to understand the situation at eachfactory, and then to consider solutions collaboratively.
Getting buy-in is an important part ofthe improvement process.

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COMPLIANCE

To Be a Person Needed, Be a Company Needed

COMPLIANCE

Internal Initiatives
Adastria established the Group Code of Ethics, which addresses anti-corruption, respect for human rights, and fair and transparent businessdealings. This code ensures that our employees, as members of society,behave always with self-discipline and high ethical standards.
Every year, we reconﬁrm this code, requiring employees to read andsign to signal their understanding. We also conduct compliance training
for Group employees in Japan to prevent incidents or improprieties.
We provide separate harassment training on an annual basis for
employees. As part of our efforts to prevent harassment, we clarify in
our work rules and regulations acts deﬁned as harassment.

Management and non-management personnel receive separate training
to ensure we respond appropriately to any incidents of harassment.
In the event of acts or indications of acts violating compliance or otherviolations of propriety, laws, or rules, employees have access to an internal whistle-blowing system to report said acts. Employees may also
contact a designated external lawyer, if preferred.
This system may be used anonymously by any employee--both in Japanand overseas. The details of reports are managed in a way to preserve
conﬁdentiality. Further, we give full consideration to ensuring persons
making reports are not treated unfairly.
Number of Internal Reports and Details

Persons Receiving Harassment Prevention Training(FYE 2/2021)

4,569名Other

Compliance Violations

COVID-19, etc

Company Discounts

1.7%

（2）

*Implemented for all employees, excluding employees on leave (childcare leave, etc.)

12.2%

Store Management,
Workplace Environment（14）

Roles,etc.

（4）

（11）

Work-Related
Shifts, Overtime,
Other Work-Style

115

（84）

Speech/Actions ofSuperiors or Co-Workers*79.9% of prior-year*March 2020 to February 2021

Anti-Harassment Training

Harassment

9.6% Totalnternal
Reports: 73%

3.5%

Including Harassment

External Initiatives
We established a Supplier Hotline to ensure fair, equitable, and transparent transactions in our purchasing relationships.
Through this mechanism, suppliers may make anonymous inquiries, if
necessary, to address cases of abuse (power structure), or violations oflaws, contract terms, or ethics by members of the Adastria Group.
In the event we receive an inquiry from a business partner, the communication is shared with the director assigned responsibility. Our systemassures an appropriate and prompt response.
We conduct an annual questionnaire of our business partners in Japanand overseas as one means to maintain positive business relationships.
Through these questionnaires, we conﬁrm whether we are engaging infair business practices, identifying any inappropriate acts, violations of
the Subcontract Act, etc.

｜ Reporting Entity ｜Adastria Group｜ Publisher ｜Business Partner Questionnaire Results
Questionnaires
Sent

Responses

Number of Comments
and Suggestions

Product suppliers and production plants (domestic)

1,120

570

40

Product suppliers and production plants (overseas)

114

66

0

Sales promotions (advertising, media coverage)

100

43

1

Systems-related

65

34

1

Repair and maintenance work

39

23

0

Employee recruitment, temporary stafﬁng

28

23

0

Other (deliveries, supplies, etc.)

71

43

1

1,537

802

43

Details

Total*Includes 39 responses with positive feedback*March 2020 to February 2021

Adastria Co., Ltd. Corporate Planning Ofﬁce
50- 8510 19F, Shibuya Hikarie, 2-21-1, Shibuya, Shibuya-ku, Tokyo, Japan
TEL +81-3- 5466- 2060

｜ Published ｜November 2021

21

Copyright ©2021 Adastria Co., Ltd. All rights reserved.