NIPPON STEEL CORPORATION

Integrated report 2022

Materiality of Sustainability Issues

Materiality of Sustainability Issues
Nippon Steel recognizes that sustainability initiatives are one of the priority issues and form the basethat supports the very existence and growth of the company.
Among these initiatives we have identified our materiality in due consideration of requests fromstakeholders, the corporate philosophy and values, as well as growth strategy.

Process to identify materiality
Consider requests fromstakeholders on
environmental, social issues
and listing candidate issues

Generalize the issues indue consideration of thecompany’s corporate
philosophy and values

Verify the issues from theviewpoint of thecompany’s value creation
process and strategy

Discuss and approveissues in the Board ofDirectors meeting

Corporate Philosophy

Nippon Steel Corporation Groupwill pursue world-leading
technologies and manufacturing
capabilities, and contribute tosociety by providing excellent
products and services.

1.	We continue to emphasize the importance of integrity and reliability in our actions.
2.	We provide products and services that benefit society, and grow in partnership with our customers.
3.	We pursue world-leading technologies and manufacturing capabilities.
4.	We continually anticipate and address future changes, innovate from within, and pursue unending
progress.
5.	We develop and bring out the best in our people to make our Group rich with energy andenthusiasm.

Nippon Steel Group’s Values
Paying every possible attention to critical matters of safety, environment, disaster prevention, quality, and compliance is basic to ourexistence as a responsible manufacturing company that delivers excellent products and services.
The development of excellent personnel is a prerequisite for our production of excellent products.

Nippon Steel Group’s contribution to SDGs
In keeping with our dedication to the Nippon Steel Group’s pursuit ofworld-leading technologies and manufacturing capabilities, and tocontribute to society by providing excellent products and services, we havetaken up numerous challenges in order to play an important role supportingsocial infrastructure through steelmaking. We firmly believe that
contributing to the development of a sustainable society through ourgroup’s initiatives will also work for achievement of the United Nations’2030 Agenda for Sustainable Development, featuring SustainableDevelopment Goals (SDGs).

Our roadmap to
the future

Our roadmap to
the futureManagement Principles

Introduction

Introduction

Our Values

7172
Nippon Steel’s Materiality of Sustainability Issues- Industrial Safety and Health- Environment
Measures to prevent global
warming
Contributing to construction ofCircular Economy

Production- Quality control andassurance- R&D and intellectual
property management- Solutions that result incustomer satisfaction- Stable production andsupply

Securing andfostering of personnel- Respect for human rights- Diversity & Inclusion- Utilization and fostering of
personnel

Harmony with local
communities and society- Environmental preservation/creation
activities in communities- Contribution to society mainly in the
support of education, sports, and arts

Corporate value enhancement
and profit distribution- Generation of profit and corporate valueenhancement- Profit distribution

Thorough implementation ofcompliance- Adhering to laws and regulations as abase of all activities

Business modelBusiness model

Environmental risk management- Disaster prevention

Quality

Fiscal 2021
operating results

Fiscal 2021
operating results

Safety, environment,
disaster prevention

Nippon Steel’s Materiality
the corporate philosophy and priorities
in manufacturing

2 Materiality with due consideration of

the company’s value creating process
and potential changes in businessenvironment

3 Corporate value enhancement andprofit distribution

We are committed to continuing operations as asustainably growing company by generating profit andraising corporate value from business activities, including
sustainability initiatives. We will also contribute to society
by providing excellent products and services, anddistributing profit to employees, government,
shareholders, and other stakeholders.

4 Thorough compliance
As a responsible leading company, we thoroughly adhere to laws
and regulations, which is fundamental to all of our activities.
We believe compliance should be achieved by ourindependent efforts, based on our corporate philosophy,
value, code of conduct and the like.

Financial information

Financial information

Basic to our value creation process is use of a diverse rangeof financial/non-financial assets and competitive advantages,
and provision of products and solutions to customers. In
order to reproduce such processes, stable production andcontinual profit generation are indispensable.
We place the environmental themes as the materiality
positioned at the core of management. In order to contributeto establishing a environment-friendly society, and do so withminimal environmental impact, we are engaged in reducing
CO2 emissions by the three “Eco” initiatives and innovativetechnology development, increasing effective use ofinternally-generated resources, and promoting zeroemissions. In addition, we make efforts to build a circular
economy through recycling of industrial waste (such asplastics) generated in society.
Concerning climate issues which threaten the future ofmankind, we are advancing initiatives on two fronts: provisionof high-function steel products and solutions for contributing
to CO2 emission reductions of the society; and breakthroughtechnology development for decarbonizing the steelmaking
process. These initiatives are aimed at achieving carbon
neutral by 2050.

Corporate governanceCorporate governance

Our Corporate Philosophy (Our Values) states: “The Nippon
Steel Corporation Group will pursue world-leading
technologies and manufacturing capabilities, and contributeto society by providing excellent products and services.”
Concerning “provision of excellent products and services,”
our critical mission as a responsible manufacturing company is
to reliably produce and deliver quality products that satisfy
customers. Needless to say, the prerequisites to enable thismission include “safety, environment, and disaster prevention”
as well as thorough compliance to rules and regulations.
The “world-leading technologies and manufacturing
capabilities” are realized by our human capital. Securing andfostering of outstanding personnel is a critical challenge to be
overcome in order to strengthen overall manufacturing
capabilities. We firmly believe that respect for human rights,
diversity & inclusion, and development of human capital are

the basics for our employees to work vigorously.
With regard to the relationship with society, we must
maintain good relationship with the community where oursteelworks or other facilities are located. This is indispensable
for us to continue operating business. We are pledged tooperate in an environment-friendly manner and maintain goodcommunication with local communities, as a corporate citizen.

Materiality of
Sustainability Issues

Materiality of
Sustainability Issues

1 Materiality with due consideration of