SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Contents

Editorial Policy

1

Message from the President

3

Respect for Human Rights
Occupational Safety and Health/Accident Prevention
Details of a fatal occupational accident on January 15, 2022

Sanyo Chemical Group Sustainability
Message from the Director in Charge of Sustainability

5

Sustainability Management

7

Sanyo Chemical Group Value Creation Process

13

Stakeholder Communication

14

Sanyo Chemical Group Material Issues

Social16

Occupational Safety and Health/Accident Prevention

New Medium-Term Management Plan 2025

17

New Growth Path

18

Growth from Core Business

21

Environmental Performance Chemicals

24

Environment
Environmental Management

26

Approach to Climate Change

31

Chemical Substance Control

37

Resource Saving and Waste Reduction

42

Biodiversity Initiatives

46

Water Resources

48

54
56

Quality60

Sustainable Procurement

63

Human Resources
Human Resources (HR)Development
Diversity, Equity & Inclusion (DEI)
Work Style Reform
Health and Productivity Management

Contribution through Business

51

Local Community / Social Contributions

65
70
82
84
93

GovernanceCorporate Governance97

Compliance

102

Risk Management

104

ESG Performance Data
Environment

106

Social137

Governance

145

Policies, Standards and Guidelines

147

Independent Review

154

GRI Content Index

157

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Editorial Policy

In 2000, the Sanyo Chemical Group published its first Environmental Report. In 2008, the Environmental Report was upgraded to the CSR Report by adding information related to social
responsibility. The Group has endeavored to ensure communication with stakeholders and fulfill accountability.
In FY2022, the Group abolished the CSR Report and newly published the Integrated Report. It also posted CSR DATA BOOK 2022 (a PDF version), which offered comprehensive
information about ESG data, on the web as a supplementary tool.
In FY2023, the sustainability website was significantly reviewed and renewed to provide in-depth sustainability information. It was decided to archive the PDF version of the sustainability
website as of the end of September as the Sustainability Report for the fiscal year.
We hope that the Sustainability Report, together with the Integrated Report, will aid understanding of our commitment to sustainability management.

Reporting period
The period covered is mainly FY2022 (from April 2022 to March 2023) but is extended to June 2023 for those that made significant progress in terms of management, such asorganizational and policy changes. The numerical data regarding ESG covers the period from April 2022 to March 2023.

Covered Organizations
The basis of the Company's business.
SANYO CHEMICAL INDUSTRIES, LTD.
DOMESTIC SUBSIDIARIES & AFFILIATES・SDP Global Co., Ltd.
・SAN NOPCO LIMITED・San Chemical Co., Ltd.
・San-Apro Ltd.
・San-Petrochemicals Co., Ltd.
・Sanyo Chemical Logistics Co., Ltd.
・Shiohama Chemicals Warehouse Co., Ltd.
OVERSEAS BASES
・Sanyo Kasei (Nantong) Co., Ltd. ＊・San-Dia Polymers (Nantong) Co., Ltd. ＊・SANYO CHEMICAL（SHANGHAI）TRADING CO., LTD.
・San Nopco (Shanghai) Trading Co., Ltd.
・DaXiang International Trading (Shanghai) Co., Ltd.
・Sanyo Kasei Korea, Ltd.
・Sanyo Chemical Manufacturing Korea, Ltd.
・San Nopco (Korea) Limited
・Sanyo Chemical America Incorporated
・Sanyo Chemical Texas Industries, LLC＊

・Sunrise Chemical LLC
・Sanyo Kasei (Thailand) Ltd. ＊・SDP GLOBAL (MALAYSIA) SDN. BHD. ＊・SANYO KASEI (TAIWAN) LTD.
As a general rule, the numerical data, including the environmental data, cover Sanyo Chemical Industries, Ltd., all business sites of subsidiaries and affiliates in Japan, and five overseas
subsidiaries and affiliates that have production facilities (the above companies with an asterisk after the company name). Notes are indicated when the scope of aggregation is different.

Inquiries
Corporate Social Responsibility Promotion Dept., SANYO CHEMICAL INDUSTRIES, LTD. ；Guidelines consulted
GRI "Sustainability Reporting Standards"
International Organization for Standardization "ISO 26000"

1

E-Mail csr@sanyo-chemical.group

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Published
October 2023 in Japanese
Next scheduled publication: November 2024
Previous publication: October 2022 (CSR Data Book in Japanese)

Cover Design for this Sustainability Report
We use the artwork of Paralym Art, which is operated by the Shougaisha Jiritsu Suishin Kikou Association.

Title:Catching the Light

Artist Name:

Oyumi

Paralym Art is an activity that promotes the social participation and economic independence of people withdisabilities through artistic expression. We support the independence of artists with disabilities as an official
partner of Paralym Art.

2

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Message from the President

Sustainability Management
In July 2022, the Sanyo Chemical Group established the Basic Sustainability Policy, under which we aim to achieve sustainable growth into the future by improving both economic andsocial value while collaborating with stakeholders based on our company mission that we have cherished since our founding.
At the core of the Group’s strategy are Sustainability Management and identifying material issues. We aim for sustainable growth by placing the following two business fields at the centerof our strategy: the Environment (E) aimed at contributing to environmental issues such as carbon neutrality, and the Life (L) aimed at improving the quality of life (QOL).

Fatal accident in January 2022
A fatal accident occurred on the premises of the Nagoya Factory. We sincerely pray for the repose of the employee’s soul and extend our heartfelt sympathy to the family of thedeceased. We would also like to deeply apologize for the aggravation and distress we have caused to all those concerned. In response to reports from the Accident Response
Committee,* which examined the accident, we have established the Safety Promotion Department. For details of our initiatives, please refer to the “Occupational Safety and
Health/Accident Prevention” section on pages 39 and 40 of this report. We are currently taking a variety of short-term and long-term measures. Although I often visit factories without priornotice, I feel that the Sanyo Chemical Group is now more conscious of safety. To prevent such an accident from happening again in the future, the management team and all employees
will work together to implement recurrence prevention measures and to foster a culture of safety.
* The Accident Response Committee consists of a total of 13 members, including factory managers and the executive chairperson of the labor union, with the Executive Officer in charge of production serving
as the chairperson and the Responsible Care Division General Manager serving as the execution manager. As of August 2022, the cause of the accident had been analyzed 15 times, and recommendations
for permanent measures had been presented.

Formulation and background of our Human Rights Policy
As we promote management that adheres to our Basic Sustainability Policy, we are aware that various human rights issues are attracting worldwide attention. In order to ensure not onlythat we do not commit direct human rights violations, but also that we do not overlook indirect involvement, we formulated and disclosed the Human Rights Policy in March 2023.

Our response to climate change
In December 2021, we officially supported the recommendations by the Task Force on Climate-related Financial Disclosures (TCFD).
Assessing the risks and opportunities that climate change may pose to the Group, we are proceeding with initiatives based on our scenario analysis.
Regarding the reduction of CO 2 emissions, we have set a long-term goal of achieving net zero emissions by FY2050 in Scope 1 and Scope 2, while aiming to reduce CO2 emissions by
50% by FY2030 compared to FY2013. To achieve our goal, regardless of the size of their effects, we have identified as many measures as possible to reduce CO 2 emissions. In
FY2022, we compiled a roadmap that provides approaches on how to implement such measures, and announced it as part of the New Medium-Term Management Plan 2025. For moredetails, please see the “Initiatives for climate change and the TCFD recommendations” page on this website.

3

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Initiatives for Diversity, Equity, and Inclusion (DEI) and Health and Productivity
Management
We aim to be a company where all employees can work comfortably with peace of mind while valuing their individuality. To this end, to ensure that all employees can play active roles, we
promote diversity, equity, and inclusion (DEI) initiatives aimed at reforming workstyle, diversifying human resources, and creating a work environment where all human rights and diverse
values are respected and accepted.
In order for individual employees to perform at a high level, it is essential that they be physically and mentally healthy. We believe that when employees work under good physical andmental condition, they and their families will be happy, thereby leading the growth of the company. Based on this belief, we promote initiatives for Health and Productivity Management.
In Japan, where the birthrate is declining and the population is aging, we strongly believe that these initiatives for DEI and Health and Productivity Management are essential for us to aim
for sustainable growth into the future.

Aiming for sustainable growthThis time, we will use this website to introduce in detail to our stakeholders our efforts in the areas of environment (E), society (S), and governance (G) for the sustainable growth of theGroup.
Based on our company mission, “Establish a better society through our corporate activities,” we aim to achieve sustainable growth into the future. We ask for the continued
understanding and support of everyone involved.

September, 2023
Representative Director, President, and CEO

4

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Message from the Director in Charge of Sustainability

Overview of Sanyo Chemical’s Sustainability Management
Since its founding, the Sanyo Chemical Group has conducted corporate activities based on its company mission, “Establish a better society throughour corporate activities.” As a result, using the chemical technology that we have cultivated, we have developed a wide range of products that makesociety and people’s lives more comfortable and convenient, and we are proud to have contributed to establishing a better society.
However, in response to the recent rise in environmental awareness, we have become more aware that a wide range of products that we offer should
contribute to the pursuit of comfort and convenience, and at the same time, that we should contribute to the realization of a sustainable society throughcorporate activities by reducing the environmental impact throughout the supply chain.
Also, from the perspective of corporate sustainability, we have become aware that we need to change our existing decision-making structure andpersonnel system to more transparent ones that will help improve employee engagement.
Against this background, we established the Basic Sustainability Policy in FY2022 to show our new management stance of aiming to achieve
Director, Managing Executive Officer
In charge of Sustainability, General Manager
of Corporate Planning Division

sustainable growth into the future by improving both economic and social value while collaborating with stakeholders.

Hiroyuki Susaki

Position and relationships of the Sustainable Management Committee and the CSR
Promotion Management Committee
We currently have the Sustainable Management Committee, which reports directly to the Board of Directors and is chaired by the President, and the CSR Promotion Management
Committee, which reports directly to the Management Council and is chaired by the General Manager of the General Affairs Division.
The Sustainable Management Committee considers the process of creating economic and social value for the sustainable growth of the Group as a whole. In particular, regarding theenvironment, society, and governance, the committee is responsible for deliberating and deciding on policies and company-wide measures to resolve material issues (materiality) thatshould be addressed as a priority, and for developing these policies and measures into specific measures for related departments.
Meanwhile, the CSR Promotion Management Committee aims to link the implementation of the CSR guidelines (CSR activities) to effective activities. In particular, with regard to theachievement of carbon neutrality, which is one of our material issues, we have positioned the reduction of GHG emissions as the most important issue, and are working to create
systems and mechanisms to plan and implement specific initiatives to achieve this goal. The activities of the CSR Promotion Management Committee are reported to the Sustainable
Management Committee once a year.

Recognition of the importance of the role and responsibilities that we should fulfill
When it comes to issues such as sustainability and CSR, which are important to corporate activities and for which it is difficult to produce results easily, we need to pay attention to thefact that if we place too much emphasis on “form,” such as how to present our efforts to the public and how our efforts are seen by the public, our activities will often lack effectivenessand substance, as symbolized by the term “greenwashing.”
Accordingly, for our sustainability and CSR initiatives, we need to be careful not to focus solely on “form.” We constantly monitor our initiatives to determine whether they are effective andsubstantial, make course corrections if they are not so effective or substantial, and disclose their progress as appropriate.

Formulation and background of our Human Rights Policy
As stated in the Top Message, we formulated and disclosed the Human Rights Policy in March 2023 to ensure not only that we do not commit direct human rights violations, but also that
we do not overlook indirect involvement.
Please refer to the “Respect for Human Rights”

page on this website for details.

What we are currently focusing on the mostThe six items that we have identified as material issues are all important issues that we should focus on. Among them, I would like to highlight the following two items here.
The first item is to achieve carbon neutrality and improve the quality of life (QOL) through the development of new products and new businesses. Specifically, we are currently focusing
most on the development of new battery materials that contribute to lighter storage batteries, and on the creation of new businesses in the fields of agriculture anddiagnostics/regenerative medicine. We believe that these initiatives will truly improve both our economic and social value.
The second item is related to the reduction of GHG emissions. We have set a goal of halving GHG emissions in Scope 1 and Scope 2 by FY2030 compared to FY2013, and we arefocusing most on efforts to achieve this goal. Specifically, believing that it is important to identify as many initiatives as possible that we can implement, from those with large reduction
effects to those with small reduction effects, and to implement them one by one to accumulate results, we are working to create systems and mechanisms for their implementation.

5

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Promotion of communication with stakeholders
As stated in our Basic Sustainability Policy, collaboration with stakeholders is an essential factor for us to aim for sustainable growth into the future. Moreover, in order to collaborate withstakeholders, we need them to understand the overall picture of our Sustainability Management. “Understanding the overall picture” here refers to understanding not only what we aredoing but also our ideas and basic policies behind such action. We believe that it is important for us to communicate with stakeholders so that this purpose can be attained.
This sustainability website has been updated based basically on the above idea. We sincerely hope that this idea of ours will be conveyed to all of our stakeholders, even if only to aslight degree.

What we would like to achieve in the future
As mentioned at the beginning, we take pride in having developed a wide range of products that make society and people’s lives more comfortable and convenient, and in having
contributed to establishing a better society based on our company mission since our founding. This pride comes from the following. Although we are a small business, as a manufacturerof performance chemicals with unique functions, we have boasted a high profit margin while supporting the Japan’ manufacturing industry behind the scenes, and have shone as a highly
profitable company that is known to those in the know.
We hope that our corporate activities will be consistent with societal sustainability, that we will become a company that can continue to shine, and that this will be understood by our
stakeholders.

Request for your understanding and cooperation
We have contributed to and will continue to contribute to the realization of a sustainable society through a wide range of products that we create using the unique and unparalleledtechnology that we have cultivated. We believe that this will in turn ensure our sustainability. We would like to convey this belief to all of our stakeholders and ask for their understanding.
We would be more than happy if you could take a closer look at this updated sustainability website and deepen your understanding of the Group.
We appreciate your continued understanding and support for us.

Director, Managing Executive Officer
In charge of Sustainability, General Manager
of Corporate Planning Division

6

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sustainability Management

All policies and initiatives related to sustainability of the Sanyo Chemical Group originate from its company mission, “Establish a better society through our corporate activities,” which has
been valued since its founding.
This company mission represents the spirit of realizing sustainable harmony between society and the company through corporate activities. It serves as the foundation of all our
activities.

Basic Policy
In FY2022, the Basic Policy on Sustainability was established to define the future vision of our corporate activities, which is based on the company mission that has been implemented
since our founding. This is the foundation of the sustainability management strategy of our Group. We believe that the enhancement of both economic and social value in close
cooperation with all stakeholders leads to the sustainable growth of the company.

Basic Policy on Sustainability
Our mission has been to establish a better society through our corporate activities since our foundation. Sanyo Chemical Group aims for sustainable growth in the future byenhancing both economic and social values in close cooperation with all stakeholders.

Metrics and targets
To establish a basis for more practical sustainability management, we identified material issues that have a significant impact on the creation of our medium- to long-term value. We will
cope with issues in the four fields of the environment, life, society, and governance, by setting specific metrics and targets.

Promotion system
Our Group studies appropriate response to issues that may pose management risks, and makes decisions to take action under the supervision of the Board of Directors.
To fulfill the company mission, we established the CSR Guidelines, which comprehensively compile our Group’s response to social issues. The CSR Committee, a body under the directcontrol of the Board of Directors, practiced CSR management to formulate policies, check the status of implementation, and give instructions. In FY2021, the Sustainable Management
Committee was established (chairperson: President and CEO) as a body under the direct control of the Board of Directors with sustainability management positioned as a higher-orderconcept of CSR (Corporate Social Responsibility).
The Sustainable Management Committee is responsible for establishing policies on material issues, giving instructions to take action, and reviewing the progress and results to enhanceboth economic and social value.
Meanwhile, the former CSR Committee was placed under the direct control of the Management Council and renamed the “CSR Promotion Management Committee.” The committee
formulates plans for implementing the CSR Guidelines (CSR activities), and monitors the status of implementation in order to conduct effective activities.

7

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sustainable Management Committee and CSR Promotion Management Committee
The Sustainable Management Committee considers the process of creating economic and social value for the sustainable growth of the Group as a whole. In particular, regarding theenvironment, society, and governance, the committee is responsible for deliberating and deciding on policies and corporate measures to resolve material issues that should be prioritized,
and for developing these policies and measures into measures for related departments.
Meanwhile, the CSR Promotion Management Committee aims to link the implementation of the CSR Guidelines (CSR activities) with effective activities. In particular, with regard to theachievement of carbon neutrality, which is one of our material issues, we have positioned the reduction of CO 2 emissions as the most important issue, and are working to create systems
and mechanisms to plan and implement specific initiatives to achieve this goal. The activities of the CSR Promotion Management Committee are reported to the Sustainable Management
Committee once a year.

[Sustainable Management Committee][CSR Promotion Management Committee]

ChairmanPresident / CEOChairman

General Affairs Div is ion General Manager

Committee
members

Full-time Direc tor, pers on appointed by c hairman

Committee
members

General Manager and Deputy General Manager of
eac h Sales , Res earc h, Produc tion, andAdminis trativ e Div is ion Nominee of the Chairman

ObserverFull-time Audit & Superv is ory Board member
ObserverFull-time Audit & Superv is ory Board member

Secretariat

General Manager of Corporate Planning Div is ion,Manager of Corporate Planning Div is ion

Secretariat

Corporate Soc ial Res pons ibility Promotion
Department Senior Manager[Purpose][Purpose]

To enhance both the economic value and corporate value while coordinating with

Meeting social needs and expectations and fulfilling the company mission to help create astakeholders in order for continual growthsustainable society[Holding frequency][Holding frequency]

Twice a year or more

Twice a year or more
[Role][Role](1)To discuss the process of creating economic value and corporate value for the(1)Creating systems and mechanisms to plan and implement specific initiatives to realize

purpose of sustainable group company growthcarbon neutrality(2)To examine and determine policies for solutions and company-wide measures for(2)Monitoring the status of promotion and proposing improvement measures

Materiality and develop them into measures for the relevant departments(3)Monitoring the planning and implementation of promotion plans for each fiscal year by(3)To review the plan, progress, and results concerning the above measures and examine

the person or department responsible for promotion, from the viewpoint of ensuring theand determine improvement, correction, and other results

effectiveness of CSR activities, and proposing improvement measures(4)To serve as the dissemination base of information concerning our sustainability(4)Constantly reviewing the basic policies (e.g., CSR Guidelines) to meet social needs

management in order to proactively communicate with stakeholders, as well as global

and expectationsorganizations, such as the United Nations

8

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

CSR Guidelines
The initiatives of our Group to deal with social issues were comprehensively compiled as the CSR Guidelines, which comprise nine items.

Items of the CSR Guidelines

Details

1. Safety and accident prevention

We will giv e top priority to s afety and ac c ident prev ention in all our bus ines s ac tiv ities . We will s triv e for thec ontinuanc e of ac c ident-free and injury -free operation, and c ontribute to s oc ial s afety. At the s ame time, we willprotec t the s afety and health of ev ery one inv olv ed in our operations , and s triv e to c reate a c omfortable work
env ironment.

2. ComplianceAll direc tors and employ ees of our Group mak e s ure to tak e ac tion with the ques tions in “Adv ic e on Compliance” inmind, inc luding “Can y ou dec lare openly that y our ac tions hav e alway s been legal, jus t, and fair?”

3. Reduction of environmental
impactWe work v oluntarily and s teadily on effec tiv e meas ures to reduc e greenhous e gas emis s ions and the generation ofplas tic and indus trial was te. Notably, to reduc e greenhous e gas emis s ions , we ac tiv ely promote energy conservationand the s hift to renewable energy.

4. Product development

We aim to dev elop produc ts that are us eful in s oc iety and that c an “realiz e a s us tainable global env ironment” and“improv e c onv enienc e and c omfort,” by c ombining the s trengths that we hav e ac quired with new s trengths that we will
ac quire and ex ternal ex pertis e.

5. Sustainable purchasing

We hav e our Sus tainable Purc has ing Polic y in plac e and s teadily fulfill the polic y to c ontribute to “realiz ing as us tainable global env ironment,” and av oid c omplic ity in human rights v iolations throughout the s upply c hain,
inc luding s uppliers .

6. Product safety and quality
reliability

We prov ide ac c urate produc t information to ex ternal parties to ens ure s afety throughout the produc t lifecycle, fromdev elopment and manufac ture to us e and dis pos al of produc ts . To improv e the quality reliability of products, we
ens ure rigorous quality c ontrol in-hous e.

7. DEI and human resource
development

We res pec t the div ers ity, pers onalities , and indiv iduality of our employ ees , and ens ure a s afe and c omfortable
work plac e env ironment. We dev elop human res ourc es who c an ac hiev e s elf-ac tualiz ation by demons trating selfinitiativ e and c reativ ity in addition to realiz ing well-being, abundanc e, and mental and phy s ic al health. We endeavor toeliminate haras s ment and res pec t human rights in the work plac e.

8. Dialogue with stakeholders

We dis c los e financ ial and non-financ ial information of our Group in an ac tiv e and fair manner and promote dialogue sothat our s tak eholders , inc luding c us tomers , s hareholders , inv es tors , s uppliers , loc al c ommunities , loc al governments,
mas s media, and employ ees c an c orrec tly unders tand the c orporate v alue of our Group, and s o that we canunders tand the ex pec tations and ev aluations of our Group from the v iewpoint of our s tak eholders and reflect them inour c orporate ac tiv ities .

9. Social contribution activities

We maintain our v oluntary ac tiv ities to c ontribute to educ ational and res earc h ins titutions , medic al ins titutions, local
c ommunities , NPOs , and NGOs , with the aim of promoting s c ienc e and tec hnology, art, c ulture, educ ation, andwelfare.

9

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Supporting initiatives
Initiative

Subjects/contents

Sponsoring organizations

UN Global Compact

Human Rights , Labor, Env ironment and AntiCorruption

United Nations

Responsible Care Global Charter

Res pons ible Care

ICCA（International Counc il of Chemical
As s oc iations ）TCFD（Task Force on Climate-related Financ ial
Disclosures ）Climate c hange

Tas k Forc e on Climate-related Financial
Dis c los ure

Challenge Zero by Keidanren

Climate c hange

Keidanren (J apan Bus ines s Federation)

GX League

Green trans formation

Minis try of Ec onomy, Trade and Industry

Keidanren Initiative for Biodiv ers ity
Conservation

Biodiv ers ity

Keidanren (J apan Bus ines s Federation)

Ikuboss Corporate Alliance

Work s ty le reform

NPO Corporation Fathering J apan

“Declaration on Action” by a group of maleleaders who accelerate “A Soc iety in whic h
Women Shine”

Promotion of women’s adv anc ement

Cabinet Offic e

The “Challenge to 30% by 2030” initiativ e of theJapan Business Federation (Keidanren) aims toachieve a ratio of 30% or more female
executives by 2030

Promotion of women’s adv anc ement

Keidanren (J apan Bus ines s Federation)

LGBTQ

Public Interes t Inc orporated As s ociation
Marriage For All J apan (MFAJ )― Freedom of marriage for all
NPO Legal Network for LGBT and Ally
Lawy ers , Certified NPO Rainbow Diversity

Business for Marriage Equality

Major participating organizations
Organization name

Position, qualification, etc.

Keidanren (Japan Business Federation)

Offic erJapan Chemical Industry As s oc iation

RC c ommittee member

Japan Surfactant Industry As s oc iation

Direc tor

Japan Urethane Raw Materials As s oc iation

Direc tor

Kyoto Model Forest Association

Direc tor

Roundtable on Sustainable Palm Oil (RSPO)RSPO member

10

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

ISO certification
Sanyo Chemical and its domestic subsidiaries and affiliates obtained certification for the environmental management system (ISO14001) between 1999 and 2001, and then we havemaintained this certification for approximately 20 years. However, we discontinued the certifications for domestic facilities in FY2020 based on our judgment that we are able toadequately operate the system on our own. The certifications of overseas facilities will continue.
As a pharmaceutical-related quality control management system, the Biotechnology & Medical Division acquired ISO 13485 certification for medical devices in 2019 and for invitro
diagnostic medicine.

Production Base

Location

Facility

ISO14001

ISO9001Year
established(in operation)

Year acquired

Certification
authority

Year acquired

Certification
authority－

Sany o Chemic al Kas hima Fac tory

1977

－

－

1997

JCQA

－

Sany o Chemic al Ky oto Fac tory

1949

－

－

1999

JCQA

－

Sany o Chemic al Nagoy a Fac tory

1969

－

－

1998

JCQA

－

Sany o Chemic al Kinuura Fac tory

2010

－

－

2010

JCQA

①

SDP Global Co., Ltd.

2001

－

－

2000

JCQA

②

San Chemic al Co., Ltd.

1982

－

－

2000

JCQA

③

SAN NOPCO LIMITED

1966

－

－

2000

JCQA

④

San-Petroc hemic als Co., Ltd.

1977

－

－

－

－

⑤

Sanyo Kasei (Thailand) Ltd.

1997

2009

TICA/J-VAC

2004

TICA/J-VAC⑥

Sanyo Kasei (Nantong) Co., Ltd.

2003

2012

TUV NORD

2006

TUV NORD

11

ction

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Non-production Base

Production Base

Location

Facility

ISO14001

ISO9001Year
established(in operation)

Year acquired

Certification
authority

Year acquired

Certification
authority⑦

San-Dia Polymers (Nantong) Co., Ltd.

2003

2013

CQM

2007

DET
NORSKE
VERITAS⑧

SDP GLOBAL (MALAYSIA) SDN. BHD.

2015

－

－

－

－

⑨

Sanyo Chemical Texas Industries, LLC

2005

－

－

－

－

⑩

San-Apro Ltd.

1966

－

－

2003

JCQA

⑪

Sanyo Chemical Logistics Co.,Ltd.

2020

－

－

－

－

⑫

Shiohama Chemicals Warehouse
Co.,Ltd.

1983

－

－

－

－

Note: The four Sanyo Chemical factories and domestic affiliates/subsidiaries ① through ④ will discontinued their ISO 14001 certification in FY2020. ④San-Petrochemicals Co., Ltd also discontinued its ISO
9001 certification in FY2020.

12

ction

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Chemical Group Value Creation Process

13

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Stakeholder and Communication

The business operated by the Sanyo Chemical Group is founded on relationships with various stakeholders, including customers, suppliers, shareholders, investors, local communities,
and employees.
We believe that our efforts to give consideration to the interest and needs of these stakeholders, gain trust and build cooperative relationships through communication, and meet their
expectations will lead to sustainability of society and our company.

PolicyWe endeavor to ensure that our stakeholders, including customers, shareholders, investors, suppliers, local communities, local governments, mass media, and employees can correctly
understand the corporate value of our Group. We proactively disclose financial and non-financial information of our group in a fair manner, and promote dialogue so that we canunderstand the expectations and evaluations of our Group from the viewpoint of our stakeholders and reflect them in our corporate activities.
We also promote communication among Group employees with the aim of building a sense of unity within the Group.
Stakeholder communication
Stakeholder

Relationship with the Sanyo ChemicalGroup

Communication policy and attitude

Main communication opportunities

・Direc t c ommunic ation throughs ales ac tiv ities inc luding
ex hibition s ales
We aim to improv e c us tomers atis fac tion by offering s afe ands ec ure produc ts that meet theneeds of c us tomers , and by
res ponding promptly,
appropriately, and wholeheartedly
to their opinions and reques ts .

Customers
Bus ines s partners who promote
env ironmental and CSR
management together with the
Sany o Chemic al Group throughthe s ale and purc has e of produc ts
and s erv ic es (e.g., green
proc urement, CSR proc urement).

・Inquiries by phone or v ia thewebs ite・Res ponding to c us tomers ' green
proc urement, etc .
・Dis s emination of information on
initiativ es for new produc ts , newtec hnologies , and new bus ines sfields・Communic ation of c orporate
information and ESG information

We work on s us tainableproc urement with c ooperation froms uppliers , and maintain long-term
trus t bas ed on fair and impartial
trans ac tions .

Suppliers

・Direc t c ommunic ation throughproc urement ac tiv ities
・CSR ques tionnaires
・Meetings to ex c hange opinionswith s uppliers
・General meetings ofShareholders and investorss hareholders

Entities that prov ide funds and areengaged in management in s ome
way or another. Our bus ines s
performanc e direc tly res ults intheir profits or los s es . Thus , they
are highly interes ted not only inthe financ ial and non-financ ial
information of c ompanies but als oin ESG ev aluation res ults andratings .

We dis c los e information about theGroup in a timely, appropriate, andfair manner to help s hareholders
and inv es tors c orrec tly
unders tand and rec ogniz e thec orporate v alue of the Group.

・Seminars for ins titutional
inv es tors and analy s ts andres pons e to interv iews
・Seminars for indiv idual inv es tors
・Res earc h laboratory tours
・Bus ines s reports
・Webs ite・Shareholder ques tionnaires

14

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Stakeholder

Local communities

Relationship with the Sanyo ChemicalGroup

Communication policy and attitude

Loc al c ommunities are direc tly
affected by pollution fromfactories, pollution prevention
measures, and injuries andaccidents. Their interest is fromthe viewpoint of preservation of
the living environment and theimpact on health. They expect
companies to work on suchinitiatives as accident prevention
and social contribution activities.

We deepen communication withlocal communities to help people
understand the activities of the
Sanyo Chemical Group andensure harmony with such
communities.

Main communication opportunities

・Social contribution activities,
such as sponsoring events andsupporting schools
・Cooperation for disasterprevention and traffic safety
・Contribution

・Various education and training
programs, talks with the
management, interviews

Constituent members of acompany Because they are
employed by companies, they are
significantly affected by corporate
decisions and management.
They take the initiative to promote
CSR activities systematically.

Employees

We aim to create a workplace
where every employee feels prideand satisfaction in his/her work.

・Personnel systems, such asworkstyles and healthmanagement
・In-house newsletters andIntranet
・Whistleblowing contact point(hotline)

Click here

for communication results

15

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Chemical Group Material Issues

Approach to materiality identification
The difinition of material issues; important issues that have a significant impact on the medium-to-long-term value creation of Sanyo Chamical GroupThe Sanyo Chemical Group defines materiality as “important issues that have a significant impact on the medium- to long-term value creation of the Sanyo Chemical Group.” We believethat it is necessary to identify materiality in order to continue to create value with the intention of satisfying all stakeholders defined by the Group. To create value for all stakeholders, wehave identified materiality by following the process 1 to 4 below, considering that identifying and prioritizing medium- to long-term themes is the shortest route to value creation.

Process 1. Identification of issues
Issues have been selected with reference to various guidelines, such as the SASB Standards for the chemical industry, the GRI Guidelines, the Sustainable Development Goals(SDGs), and the World Economic Forum (WEF) core metrics, as well as communication with stakeholders and a questionnaire on our company mission for all employees and officers.

Process 2. Prioritization of the issues and creation of the materiality matrix
The identified issues have been prioritized through dialogue with major shareholders and employees about their impacts on our corporate identity and finance, opportunities to create
innovation, and the Sanyo Chemical Group’s uniqueness. The issues were then plotted on a matrix with management and business perspectives placed on the horizontal axis andexpectations and contributions to resolving social and environmental issues placed on the vertical axis.

Process 3. Identification of material issues
With a focus on the upper right area of the materiality matrix, six material issues have been identified, with issues related to the Environment field and the Life field as material issues on
the business domain and issues related to the Society field and the Governance field as material issues on the management domain. (The Life field has been separated from theconventional ESG portfolio and categorized as a symbol of expectations and contributions to the improvement of QOL.)

Process 4. Validation of the material issues and board approval
The material issues have been validated through deliberations at the Sustainable Management Committee, which is chaired by the President and CEO, and have been approved by the
Board of Directors. The issues will be reviewed according to changes in the business environment that may occur in the future.

Sanyo Chemical Group Material Issues
We have identified six material issues based on our company mission, “Establish a better society through our corporate activities.” We address these issues while realizing “Inspire
WakuWaku feeling from all the stakeholders,” “Co-create environmental, social and economic value with the stakeholders,” and “Facilitate every employee’s value creation.”16

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

New Medium-Term Management Plan 2025
The Sanyo Chemical Group implemented the “WakuWaku Explosion 2030” management policy in March 2022. Based on the company mission since our founding, “Establish a better
society through our corporate activities,” each and every employee has been working to create values toward becoming an exciting (WakuWaku) company, where everyone can shine,with the three pillars of “Contribution to carbon neutrality (CN),” “Improvement of quality of life (QOL),” and “Improvement of job satisfaction,” so that we can contribute to creating asustainable society.
On the other hand, in FY2022, negative factors such as lockdowns in China due to novel coronavirus infections (COVID-19), soaring energy prices due to the turmoil in Ukraine,
automobile production cutbacks due to semiconductor shortages, sharp depreciation of the yen, and other global environmental changes have had significant impacts on our business
operations.
Under these circumstances, the Sanyo Chemical Group formulated the New Medium-Term Management Plan, a three-year plan which defined the growth path of our Group and specificmeasures to realize the vision in the Management Policy. With its chemical capabilities to accelerate the creation of new value, the Sanyo Chemical Group will make concerted efforts toenhance value throughout the entire supply chain and generate innovation beyond the boundaries of chemistry.

New Medium-Term Management Plan 2025
Basic Policies
Business Strategy (FY2023-FY2025)
1. Growth from Core BusinessWe will position five focus product groups that contribute to carbon neutrality (CN) and improvement of QOL (quality of life) as “high-value-added products categories,” and accelerate
research and development as well as capital investment in these product categories in order to generate earnings.
2. Reformation of Existing BusinessWe will improve profitability by transforming the business process throughout the supply chain and implementing structural reforms in the polyurethane and superabsorbent polymer(SAP) businesses.
3. Global Deployment
We will expand facilities in overseas plants and strengthen the functions of overseas sales offices.

Toward the Future Beyond 2025
1. New Growth Path
We will focus our resources on growing areas where we can contribute to carbon neutrality and improvement of QOL. We will reinforce innovative actions including opportunities forstrategic alliances and M&A.
2. Solutions to Social Issues
We aim to pursue significant reduction of CO2 emissions through Carbon dioxide Capture and Utilization (CCU). We will proactively address human rights issues in the supply chain.
3. Initiatives to Support Growth
We will promote human resources development and improvement of the work environment. We will manage with safety and quality as our top priority and promote transparent
management.
Revision of earnings forecast
Reflecting the external environment and the progress of internal transformation, we have revised the target of “20 billion yen in operating profit in FY2024” set forth in the management
policy.

17

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

New Growth Path

Proactive new business development
The Sanyo Chemical Group has set “Achieve carbon neutrality as Interface Innovator” and “Improve QOL by performance through chemistry” as material issues on business domain.
During the period of the New Medium-Term Management Plan 2025, we will focus on developing new businesses and products that contribute to carbon neutrality and improvement of
QOL, with the aim of creating next-generation businesses that will open up a new growth path toward 2030. We will aim for the commercialization of new businesses and products at an
early stage by continuing to inject resources and reinforcing innovative actions, including opportunities for strategic alliances and M&A.

Carbon recycling (CCU)
We have accumulated know-how in the design and manufacture of ionic liquids over many
years through our main business of electrolytes for aluminum electrolytic capacitors.
Currently, we are considering how to apply our ionic liquid technology to the systems thatcan efficiently capture and utilize CO 2 (CCU: Carbon dioxide Capture and Utilization). CCU
is expected to play a key role in sustaining the use of fossil fuels and the current industrial
processes while controlling greenhouse gas emissions, which contribute to climate change.
It is also expected to achieve negative emissions of CO2 when combined with renewableenergy.
We aim to apply our ionic liquid technology to the separation of CO 2 from the air, which is
attracting attention as a negative emission technology, as well as from flue gas throughconsortium activities involving engineering partners, municipalities, and other chemical
manufacturers, without being bound by the existing business framework.

(Source) Ministry of Economy, Trade and Industry “What is CCUS Technology?” (in Japanese)
https://www.meti.go.jp/policy/energy_environment/global_warming/roadmap/innovation/ccus.html

Energy (Organic cathode active materials)
As expectations for next-generation devices, such as drones and HAPS (High Altitude Platform Station), a stratospheric communication platform, are increasing, it has become
necessary to develop light, safe next-generation batteries with high weight energy density in order to dramatically improve the performance of these devices. Also, from the perspective ofsustainability, high-performance batteries are indispensable for promoting electrification and storing renewable energy, which are measures to achieve carbon neutrality. Current
lithium-ion batteries are said to be close to the upper limit of their performance, and we are promoting material development with a focus on organic cathode secondary batteries as a typeof next-generation battery.
Organic cathode secondary batteries are characterized by the replacement of current inorganic materials containing rare metals, used as cathode active materials, with organic
materials, and are expected to significantly improve weight energy density. They also help avoid the shortages and soaring prices of rare metal resources and risks to their stable supply.
We will develop and manufacture the key organic materials, aiming to achieve early results in cooperation with partner companies.
Image of an organic cathode secondary battery(Source) SoftBank Corp. (in Japanese)18

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Agriculture (Peptide materials)
In modern agriculture, food crises due to labor shortages and abnormal weather, as well as the environmental impact
caused by pesticides and chemical fertilizers, have become major social issues. Peptide agriculture, which we aim toput into practical use in FY2023, is a technology that maximizes the innate functions of plants by giving peptides, which
are biostimulants,* to vegetables and fruit trees. Peptides are expected to improve in quality and yield through the
mitigation of their damage due to disease and climate change, and to help reduce the use of pesticides and chemicalfertilizers. By making full use of our fundamental technologies, such as interface control technology, we can produce
peptides extracted from natural products, including unused resources, and fermentation-produced peptides derived
from natural products. This will provide the world’s first agricultural solution using multiple functional peptides. As apioneering attempt, we plan to sell peptide fertilizers and then provide peptide spraying methods suitable for each cropand techniques for preserving product freshness, with the aim of building a business model that contributes to the
production of high-value-added vegetables and fruits.
* Biostimulants:
This is a new technology that reduces plant damage caused by climate and soil conditions by controlling abiotic stresses (high andlow temperatures, physical damage, etc.) to plants in order to provide healthy plants. Its global market size is expected to be threebillion dollars, with an average annual growth rate of more than 12%.

Diagnostic and regenerative medical care (Extracellular vesicles: EVs)
In recent years, body fluid components, called “exosome-containing extracellular vesicles,” have been attracting
considerable attention in medical fields that are directly linked to improving QOL, such as disease discovery andregenerative medicine. It is expected that the research market alone will grow to over 100 billion yen by 2030. Jointlywith Tokushima University, we have developed EXORPTION ® , a method for collecting extracellular vesicles fromvarious body fluids with high efficiency, high yield, and a high degree of purification, by applying the body fluid
component collection technology and know-how that we have cultivated in the in vitro diagnostic reagent business. By
disseminating this technology, we aim to support new diagnostic and therapeutic research using extracellular vesicles,
and to implement diagnostic agents to which this technology is applied in clinical settings.

In vitro diagnostic medical products (Accuraseed)
Immunoassay-based in vitro diagnostic reagents are used for the purpose of diagnosing diseases, and their domestic
market size reached approximately 250 billion yen in 2021. We have developed reagents dedicated to Accuraseed ® *that use our unique magnetic particles, Magrapid. These are in vitro diagnostic reagents that enable rapid
immunoassay in just 10 minutes. Since these agents dedicated to Accuraseed ® were launched jointly with FUJIFILM
Wako Pure Chemical Corporation in November 2015, their lineup has expanded to include 30 inspection items,
including thyroid diseases and infectious diseases. This helps meet the need for rapid diagnosis in clinical settings. In
June 2022, Sanyo Chemical Industries, Ltd. and FUJIFILM Corporation established FUJIFILM Sanyo Chemical
Healthcare Corporation to consolidate the production systems for the reagents dedicated to Accuraseed ® of bothcompanies. We will strengthen our production base to achieve high productivity and respond to the growing demand forin vitro diagnostic reagents.
* Accuraseed® :Fully automated chemiluminescent enzyme immunoassay system manufactured by FUJIFILM Wako Pure Chemical Corporation

Wound healing material and meniscus repair (Silk-elastin)
As Japan’s aging society progresses, an increasing number of people are suffering from diabetic skin ulcers, pressure
ulcers, knee osteoarthritis, and other diseases. In particular, many patients whose natural healing powers havedeclined due to aging are finding it increasingly difficult to recover with conventional treatments. It is said that there are
150,000 patients with refractory skin ulcers and eight million patients with knee osteoarthritis in Japan.
We use the functional protein “silk-elastin,” which is under development at the company, for such patients to enhancetheir natural healing powers, thereby trying to heal their wounds (tissue regeneration) that could not be healed byconventional treatments. Since 2016, we have conducted clinical trials on skin defect regeneration and meniscus repair
to confirm the efficacy and safety of silk-elastin. We plan to implement it in society by 2024 as a regenerative medical
device “wound healing material” intended to regenerate refractory skin defects. We also plan to implement it in society
by 2026 as a meniscus repair for patients with knee osteoarthritis. We aim to extend healthy life expectancy throughsilk-elastin to contribute to improving the QOL of the elderly.

19

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Digital olfaction (Electric nose)
Reproduction of the five human senses is being actively studied in order to cope with the recent IoT trends and realize
next-generation communication using the five senses. In particular, it is difficult to reproduce the olfactory sense, andproducts and services that visualize odors and aromas have yet to be fully and practically implemented in society.
Digital olfactory technology, which digitally identifies and quantifies specific odors, is expected to be applied in the
medical field and the life-related fields including food and beverages, and its market size is expected to reach $3.12
trillion by 2026.
The Group provides 3,000 types of functional chemicals. By using the technology and knowledge that we haveacquired in this field, we have developed a highly practical electric nose that can be easily customized for various
odors.
In addition to this feature, our electric nose is characterized by the ability to quickly and continuously identify complex
mixed odors, which is difficult for commercially available gas sensors.
Toward the commercialization of electric noses, we are working on initiatives that use electric noses to contribute to theimprovement of QOL. For instance, we consider the visualization of sanitary environment conditions to improve theenvironmental and enhance work efficiency as well as the visualization of the aroma of foods and luxury items. We aim
for the early commercialization of electric noses to create new value through the visualization of odors.

20

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Growth from Core Business

Positioning chemicals for special fibers, chemicals for special electronic parts, lubricant additives, permanent antistatic agents, and medical and pharmaceutical products, which
contribute to carbon neutrality and the improvement of QOL, as five focus product groups, we plan to make capital investment of nine billion yen from FY2021 to FY2025, which includes
the period of the Medium-Term Management Plan. We expect an incremental operating profit of 2.5 billion yen from this capital investment, and aim to achieve an operating profit of 7.9
billion yen by FY2025 from the five focus product groups. We will also consider additional investments in order to further expand our business.
Results and targets of sales / operating profit / operating profit ratio for five focus
product groups

Accelerate capital investment in high-value-added products(Note) (Start year / Investment amount [billion yen])(Note) Research and development expenses (approx. two billion yen per year) related to new businesses arerecorded as company-wide expenses and are not included in the above operating profit.

Chemicals for special fibers
These products contribute to carbon neutrality. Our chemicals for special fibers are mainly used for carbon fibers. Blades of windmills, which are one of the main uses of carbon fibers(windmills, automobiles, aircraft, and pressure vessels), are seeing a rapid increase in demand due to the spread of renewable energy. Demand for carbon fibers is expected to expand
as wind power generation increases, and blades become larger. In addition, the development of applications in new fields is progressing. In order to respond to growing demand forcarbon fibers, we have decided to increase the production capacity for sizing agents for carbon fibers. In addition to the existing facilities at the Nagoya and Kyoto Factories, we plan toestablish a new production facility at the Kashima Factory. The facility is scheduled to start operation in May 2024, increasing production capacity by approximately 50%. We will seek tosecure a stable supply of sizing agents for carbon fibers in order to respond to the growing global demand. We would also like to play a major role not only in the utilization of renewableenergy and the development of its industry, but also in addressing climate change. We will continue to consider further capacity expansion in order to meet the growing demand forcarbon fibers.
Global market forecast for carbon fiber reinforced plastics by application(Source) Created based on “Global carbon fiber reinforced plastics (CFRP/CFRTP) materials and technology
report: Market size, applications, share, trends 2020” by FUJI KEIZAI CO., LTD.

21

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Chemicals for special electronic parts
These products contribute to carbon neutrality. Our chemicals for special electronic parts include electrolytes for aluminum electrolytic capacitors, which are mainly used in electronic
circuits. Electrolytes for aluminum electrolytic capacitors are used in a wide range of applications, from general electronic devices to important electronic parts that support social
infrastructure. Our electrolytes for aluminum electrolytic capacitors exhibit high electrical conductivity over a wide temperature range and are excellent in long-term stability at hightemperatures. As industry-standard long-run products, they are used in capacitors that require higher reliability, such as automobile control units. Currently in the automobile industry, an
increasing number of automobile electrical parts, such as driving support system circuits, are used due to the electrification of vehicles such as electric vehicles (EVs). In order to ensurea stable supply that meets this growing demand, we have decided to increase our production capacity. The current production capacity will be increased by 60% by March 2025.
Forecast for global production of capacitors(Source) Created based on “2022 Capacitor Market” by Sangyo-Joho Limited.

Lubricant additives
These products contribute to carbon neutrality. In the automobile industry, in order to reduce CO2 emissions, there is a growing need for fuel-efficient gasoline vehicles, along with thetrend toward electrification. Since our lubricant additives are highly effective in improving fuel efficiency, they are used in the engine oils of gasoline vehicles, hybrid vehicles (HVs), andplugin hybrid vehicles (PHVs). It is assumed that their replacement demand at the time of after-sales maintenance will increase. To meet the growing global demand for these products,
we have established a production site in South Korea, following those in Japan and China, which has already started operation. We are also working on the development of lubricant
additives optimized for EVs in order to contribute to improving the fuel efficiency of all vehicles.
Forecast for sales of gasoline vehicles, hybrid vehicles, and plug-in hybrid vehicles(Source) Ministry of Economy, Trade and Industry, “Technology Diffusion Scenario Presented by IEA (a casewhere an average temperature rise of 2°C is achieved)” (2021) (in Japanese)

https://www.enecho.meti.go.jp/about/special/johoteikyo/gosei_nenryo.html

22

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Permanent antistatic agents
These products contribute to the improvement of QOL. Permanent antistatic agents are used in a wide range of applications to prevent various problems caused by static electricity(destruction of electronic circuits, malfunction of electrical appliances, adhesion of dust) and accidents (fires, explosions). In recent years, in addition to an increase in demand centeredon semiconductor carrier trays and the packaging of electronic devices and precision parts, explosion-proof and other applications are expanding. In order to meet future demand
expansion, we have launched a new production site at the Rayong factory of Sanyo Kasei (Thailand) Ltd., which has been in operation since July 2022. Since permanent antistatic
agents are our unique, high-functionality products, we will strive to open up new markets while taking into account the possibility of further expanding the production facility depending on
our future demand. We will also promote the development of new materials.
Semiconductor market forecast by product(Source) Created based on “WSTS Semiconductor Market Forecast Spring 2023” by WSTS (World
Semiconductor Trade Statistics) Japan Council

Medical and pharmaceutical products
These products contribute to the improvement of QOL and mainly include polyethylene
glycol for pharmaceuticals and non-absorbable topical hemostatic materials for the central
circulatory system.
Polyethylene glycol for pharmaceuticals is used as a pharmaceutical additive in a basematerial for ointment and tablet coating agents, and is used as an active pharmaceuticalingredient for colon cleaning agent. It is also used in various applications such as tissue
regeneration and cell culture. To meet demand expansion due to increased sales, which is
caused by the development of generic drugs, we plan to expand the facilities at the Nagoya
Factory. These facilities are scheduled to start operation in May 2024, with the production
capacity expected to increase by approximately 20%.
Non-absorbable topical hemostatic materials for the central circulatory system are surgicalhemostatic agents made of polyurethane materials that react with water to form a flexible
film. Since their launch in 2014, they have been used in many cardiovascular surgeries inJapan as hemostatic materials used in the anastomosis of the thoracic aorta and thebranch of the aortic arch for artificial blood vessel replacement. In March 2020, the scope of
their application was expanded to include the anastomosis of whole blood vessels except
cerebral vessels. In July 2019, we obtained the CE marking for products for overseas
shipping, and started their sales in the European market. Using this as a foothold, we areaccelerating our overseas expansion, including entering the Hong Kong market in July
2021 and the Taiwanese market in December 2021. We will ensure its stable supply tosatisfy growing demand by increasing our production capacity to approximately five times(scheduled to start operation in February 2024).

23

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental Performance Chemicals

Products that contribute to reduction of environmental impact
By offering performance chemical products that meet environmental needs, we are contributing to the realization of a sustainable society.

Environmental
needs

Energy saving,
prevention of
global warming,
resource
savings

Environmental
preservation(contamination
control)

Function/performance

Sanyo Chemical product line

Increase of energy
efficiency

Lubric ant additiv es for fuel c ons umption improv ement
Fuel additiv es for fuel c ons umption improv ement

ACLUBE produc ts
SANFRIC produc ts

Reduction of energy
consumption

Low-temperature flexible toner res ins

HIMER produc ts

Weight reduc tion,
film thinning

Poly ols for high-s trength rigid poly urethane foams
Superabs orbent poly mers for thin-paper diapers
Thermoplas tic poly urethane beads for the thin interior partsof automobiles
Poly urethane s olutions for mois ture-permeable waterproof
fabric s

EXCELFLOW produc ts
SANWET SG produc ts
MELTEX LF produc ts

High durability, longservice life

Poly ols for high-res ilient flex ible poly urethane foams
Elec troly tes for high-durable elec troly tic c apac itors
Permanent antis tatic agents

SHARPFLOW produc ts
SANELEK produc ts
PERESTAT, PELECTRON products

Water sav ing, powersavingConc entrated liquid detergent bas e

PUREMEEL EP-300S
MICELAND SCD-100

Contribution to the
expansion ofrenewable energyuse

Siz ing agents for c arbon fibers (for wind turbine blades )CHEMITYLEN produc ts

RSPO c ertified produc ts

Certified ECONOL, BEAULIGHT, andLEBON produc ts
Certified PEG, poly ethy lene gly col
Biomas s degree: 10%, 25% ofs uperabs orbent poly mers

Renewable biomas s
feedstock us e
(Carbon neutrality )ISCC c ertified produc t
Biomas s mark c ertified produc ts

Removal ofhazardous
substances

Poly mer floc c ulants for was tewater/s ewage treatment
Organic c oagulants
Heav y metal fix ing agents for fly as h

SANFLOC produc ts
CATIOMER produc ts
ASHFIX produc ts
NAROACTY and SANNONIC products
SANNIX produc ts

Nonuse of haz ardous
substances

Nonionic s urfac tant for endoc rine dis rupting effec ts
Raw materials for water-ex panded (non-CFC) poly urethanefoam
Non-s olv ent ty pe ac ry lic pres s ure-s ens itiv e adhes iv es
Solv ent-les s UV/EB c uring monomers
Poly urethane beads (v iny l c hloride-free) for s lus h molding
Poly urethane res in emuls ions (s olv ent-les s ) for water-bas ed
paintsNon-halogen c leaning agents
Biodegradable s hampoo bas e

Short-term ex is tenc e
in environment

Environmental
Conservation

SANPRENE H-600

Biodegradable hair treatment bas e
Biodegradable laundry detergent bas e
Biodegradable lubric ant bas e oil

POLYTHICK AH produc ts
NEOMER produc ts
MELTEX produc ts
UCOAT produc ts
CHEMICLEAN produc ts
LEBON, PIUSERIA, and BEAULIGHT
produc ts
ECONOL TM-22
EMULMIN CS-100, MICELAND SCD-100
EXCEBIOL produc ts

Managed rainfores t
use

RSPO-c ertified c os metic ingredients

Certified ECONOL, BEAULIGHT, andLEBON produc ts

Use of rec y c lable
materials

Leather made of wood and v egetable biomas s

MOC-TEX24

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental
needs

Function/performance

Environment
improvement(greening)High water-retention
properties ,compatibility withplantsSanyo Chemical product line

Soil c onditioner (s uperabs orbent poly mer)

SANFRESH GT-1

Volume of product contribution to CO2 reduction
To visualize the contribution that our products make in reducing greenhouse gas (CO 2) emissions, we have formulated and implemented a calculation standard.
The purpose of this standard is to quantify how much CO 2 emissions can be reduced in the use, consumption, and disposal stages by saving energy and resources using our products
in comparison with widely marketed products (conventional products). Among the products that contribute to reduction of environmental impact listed in the following table, this standard
is applied only to our products whose contribution is apparent and can be quantified.
We have been using this standard since FY2012 and have calculated the single-year reduction volume in FY2022 to be 0.49 million tons and the cumulative reduction volume withconsideration given to the lifecycle to be 6.28 million tons.
Main products contributing to CO2 reduction
CO2 reduction
contribution to per kg of
product (kgCO2)
Superabsorbent
polymers forthin-paper diapers

1.8

Lubricant additives
for fuel consumption
improvement

10-20

Concentrated liquid
detergent base

1.3

Thermoplastic
polyurethane beads
for the thin interior
parts of automobiles

1.7-3.5

Ecologically friendly products
Before product commercialization, we evaluate the environmental impact given in each of the product lifecycle stages, i.e. the design, development, raw material procurement,
manufacturing, physical distribution, use, consumption and disposal and then score the evaluation on a check sheet.
We assess the product concept, use of recyclable raw materials, and environmental contribution at the product use stage, define products equal to or above a certain score as
ecologically friendly products, and determine the increase in the rate of ecologically friendly products for a management indicator.
The rate of ecologically friendly products in FY2022 was 29.5% on a sales basis.
Our Sustainability Action Plan aims for 35% in FY2024, and 50% in FY2030.

25

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental Management

In 1996, Sanyo Chemical established the management policy on responsible care (RC). It also joined the Japan Responsible Care Council (currently the RC Committee of the Japan
Chemical Industry Association) and started RC activities. In FY2000, Sanyo Chemical launched the Environmental Action Plan, which specified priority action items and target values.
The scope was expanded to subsidiaries and affiliates in Japan in FY2004 and to overseas subsidiaries and affiliates in FY2007, to promote environmental management on a Groupbasis.

PolicyOur company mission states, “We will strive for perfection in safety and harmony with the environment, which is the first required mission in society.” Our Code of Corporate Ethics
states, “We shall proactively take initiatives to conserve the environment and prevent accidents and disasters as crucial requirements for the sustainability and activity of our business.”
The CSR Guidelines specify reduction of environmental impact in Item 3, contribution to the environment and the improvement of personal lives through product development in Item 4,and sustainable purchasing in Item 5 to promote specific activities.

Management system

In January 2023, the Responsible Care Division was reorganized. Overall environmental conservation activities other than energy conservation and global warming measures, which had
been undertaken by the Environmental and Safety Administration Dept., were transferred to the Energy Saving Promotion Dept., which had specialized in energy conservation and global
warming measures. Accordingly, the Energy Conservation Promotion Dept. assumed the responsibility for supervising overall “environmental conservation” activities among the five RC
activities.
The “chemicals/product safety” activities and part of “logistics safety” will continue to be covered by the Products Evaluation Dept. “Labor safety and health” and “safety/accident
prevention” were separated from the Responsible Care Division and transferred to the Safety Promotion Department, which was newly established as a department under the directcontrol of the President and CEO.
Concerning the environmental management system (ISO 14001), which we had used as one of our RC promotion tools, we discontinued the certifications for domestic factories based on
our judgment that we are able to adequately operate the system on our own. The certifications of overseas facilities will continue. We will continue the certifications of both domestic andoverseas facilities for the quality management system (ISO 9001).
We will also continue the RC (safety, health, environment, and security) audits that we conduct once a year by visiting the sites of listed companies and laboratories in Japan.

What is Responsible Care?

Responsible Care is a voluntary activity in which businesses that manufacture or handle chemical substances ensure the environment, health, and safety throughout theentire process from development, manufacture, distribution, use, and final consumption to disposal of chemical substances based on the principle of self-responsibility, i.e.,
promoting the five activities of environmental conservation, occupational health and safety, safety and disaster prevention, chemical and product safety, and distribution safety,
promoting information disclosure and dialogue with society.

26

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental action plan 21-24（FY2021 to FY2024）
Initially, GHG emissions reduction and energy conservation were set out as activity themes for the Environmental Action Plan 21-24. To accelerate activities toward carbon neutrality, thetwo themes were transferred to the CSR Promotion Management Committee in FY2022. The themes of water conservation, reduction of waste generation, and reduction of VOCs willcontinue to be pursued under the action plan.
Scope : All facilities of Sanyo Chemical, all domestic SUBSIDIARIES & AFFILIATES and overseas facilities which have production bases *1*1 Sanyo Chemical Texas Industries, LLC, Sanyo Kasei (Thailand) Ltd., Sanyo Kasei (Nantong) Co., Ltd., San-Dia Polymers (Nantong) Co., Ltd., SDP GLOBAL (MALAYSIA) SDN. BHD.,

FY2024 target
Theme

FY2019 result(base year)

Note

TargetReduction ratecompared with base year

4,354

4,136 or les s

5% or more

5.9

3.6 or les s

39% or more－

112
Domes tic：89
Ov ers eas：22

90 or les s
Domes tic ：80 or les s
Ov ers eas：10 or les s

19.7% or more－

Water saving
Reduc tion of 1% or more per year

Water usage (thousand m3)
Waste generation control
Waste generated (10,000 tons)
VOC *2 emissions reduction
VOC emissions volume (tons)*2 Total emission of substances subject to former and revised PRTR Laws, and substances specified by the Japan Chemical Industry Association

27

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Material flow in FY2022

The values shown above are the values for consolidated results for all domestic and overseas facilities.
*1 Domestic total*2 Total of SCI (all facilities in Sanyo Chemical Industries, Ltd.), SDP Global Co., Ltd., and SAN NOPCO LIMITED*3 Total of Domestic (SCI plus domestic affiliates/subsidiaries), Sanyo Kasei (Thailand) Ltd. Sanyo Kasei (Nantong) Co., Ltd. San-Dia Polymers (Nantong) Co., Ltd. and SDP GLOBAL (MALAYSIA) SDN.
BHD.

28

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental management indicators
Environmental accounting (April 1, 2022 to March 31, 2023)
Scope of summarization:Seven domestic and five overseas subsidiaries and affiliates with production facilities accounting data have been consolidated and compiled in accordance with
the Environmental Accounting Guidelines 2005 (Ministry of the Environment). SKT, however, uses a fiscal year from January 1, 2022 to December 31, 2022.
Environmental Protection Costs[Business activities by category]Classification(1) Pollution prevention
costs
Facility area
costs(2) Global environment
costs(3) Resource recycling
costs(million yen)
Investment*1

Expense*2

297

875

27

Classification(million yen)
Investment

Expense(1) Costs related to global warming measures

34

642

(2) Costs related to ozone layer protection measures

0

2

224

408

(4) Costs related to noise and vibration

074(5) Costs related to environmental conservation
measures for the aquatic, ground, and geologic
environments

62

456

(6) Costs related to waste product and recycling
measures1

1,906(7) Costs related to measures for reducing chemicalrisk and emissions

0259(8) Costs related to natural environmental
conservation

116(9) Other costs

5

354

327

4,116

663
(3) Costs related to air quality conservation
measures1

1,898

Upstream/Downstream costs

033

Administrative costs

3505

R&D costs

0730

Social activity costs

0138

Environmental remediation costs

0

4

327

4,846

Total

[Environmental conservation measures by category]*1 The investment amount is based on the acceptances during the corresponding period.
*2 The expense amount includes depreciation.

Total
Note: Expenses for research and development are not classified.

[Economic impact](unit: million yen)
Results

Total

Main items

20

Reduc tion in purc has e of elec tric ity and s team by us ing was te heat andc ogeneration, etc .

Waste reduction

7

Reduc tion in c ons umption of res ourc es and generation of was te throughproc es s improv ements

Raw material use reduction (yield
improvement)82

Inc reas e in produc t y ield and reduc tion in proc es s c hemic als

Revenue from recycling70

Inc ome on s ale of was te s olv ents , us ed c ontainers , etc .

Energy saving

Resource
savingReduced costs(million yen)179

Note: Including effects of measures that do not involve investment (e.g., improvement of the manufacturing processes)

29

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental and safety/accident prevention investments
We are engaged in environmental conservation and safety assurance. We proactively invest not only in environmental measures, but also in safety and accident prevention, including
industrial accidents, measures against earthquakes, and the 3Ds (Dirty, Dangerous, and Demanding jobs) improvements.
In FY2022, our environmental investments totaled 330 million yen, and the investments in safety/accident prevention was 610 million yen.

Environmental efficiency index JEPIX*
Our environmental efficiency has been greatly improved by reducing exhaust gas emissions of ethylene oxide, implemented in 2005, and propylene oxide, implemented in FY2012. Our
environmental efficiency has been improving since FY2020.

Note: JEPIX (http://www.jepix.org) (Japanese only)

Calculated using PEPIX Calculation Sheet Ver. 2* JEPIX： Japan Environmental Policy Priorities Index
The total environmental point (EIP) is multiplied by the weighted coefficient of each type of environmental impact such as GHG and hazardous air pollutants.
Environmental efficiency is calculated by driving EIP by adjusted gross sales (JPY). The smaller the EIP, the better the environmental efficiency.

30

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Approach to Climate Change

GHG emission reduction and energy savings

Disclosure based on TCFD recommendations

The CO2 concentration in the atmosphere has been rising because of humans activities. Due to the greenhouse effect of CO 2 and other greenhouse gases, the global temperature has
increased by 0.3℃ to 0.6℃ in the past 100 years. Furthermore, it is predicted to increase by 1.4℃ to 5.8℃ in the next 100 years. Temperature rise causes climate change. There isserious concern that climate change will greatly affect the ecosystem and human lives through extreme weather, sea level rise, and increase in species extinction for example.
Reduction of greenhouse gas (GHG such as CO 2) emissions and stopping temperature rises are a global issues. In 2020, the Japanese government declared that Japan will achievegreenhouse gas (GHG) reduction in 2030 by 46% compared to that in FY2013, then will achieve carbon neutrality* in 2050.
* Carbon neutrality: Refers to the state of net zero CO2 emissions achieved through the use of renewable energies and the absorption of CO2 by forests and other means.

PolicyAs a chemicals manufacturer, the Sanyo Chemical Group contributes to the carbon neutrality of society as a whole by reducing GHG emissions from its business sites and developing
and offering products that help reduce CO 2 emissions.

GHG emission reduction and energy savings
GHG emission status (FY2022)
Emission / Absorption / Product contribution
classification

Emissions volume(CO2 equivalent)

GHG type

Direc t emis s ions from fuel oil c ombus tion (Sc ope 1)

130 thousand tons

Methane (generated from s eptic tank s )10 tons

Nitrous ox ide (by -produc t of c ombus tion)

36 tonsother GHG（NF 3、PFC、SF 6）

Emission

No emissions

Fluoroc arbons leak age from refrigerators and air c onditioners
Indirec t emis s ions from the us e of elec tric ity, heat, or s team s upplied byothers (Sc ope 2)
Supply c hain emis s ions (Sc ope 3)

339 tons

125 thousand tons

2,513 thousand tons

Absorption

Inc reas e in fores t CO 2 abs orption (bas ed on tree thinning projec t)

Product contribution

CO 2 reduc tion by us ing our produc ts

11 tons
493 thousand tons

Of GHG emissions from business sites, the main gases other than CO 2 are methane from septic tanks, nitrous oxide, which is a combustion by-product, and fluorocarbons, which leakfrom refrigerators and other equipment (385 tons in total in CO2 equivalent). Emissions of these GHGs other than CO 2 account for 0.15%, which is very small compared to the emissionsof Scopes 1 and 2. Almost all emissions from the supply chain, including Scope 3, are CO 2.
Click here

for details of Scopes 1, 2, and 3

Midterm to long-term goals of greenhouse gas emission reduction plan (Scope1+Scope2)
Target(CO2 equivalent)

FY

Note

2013

309 thousand tons

Bas e y ear

2030

154 thousand tons

Intermediate target (50% reduc tion c ompared to bas e y ear)

2050

Net Zero

Final target (c arbon neutrality )31

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Additionally, in FY2018, we changed the sales management policy to selectively sell high value added products and stop selling low value added products. As a result, domestic
production volumes decreased have significantly decreased. Overseas, although the production volumes had been increasing until FY2020, the Chinese affiliate’s production volume has
been decreasing particularly largely since FY2021, as a result the group-wide production volume decreased by 20% compared to FY2018. Because of the product mix change andproduction volumes decreases through sales policy changes and the CO 2 reduction measures of by the Work Group, CO 2 emissions in FY2022 were 255 thousand tons. In terms ofenergy consumption in crude oil equivalent, it is also decreasing for the same reasons.

Measures toward carbon neutrality
Most of the GHG emissions from business sites of our Group are CO2. Thus, we aim to achieve carbon neutrality across the supply chain by focusing on efficient utilization through theestablishment and operation of an energy management system, and on energy transition (from fossil fuels to sunlight and hydrogen) in Scopes 1 and 2. Meanwhile, in Scope 3, we use
low-GHG raw materials (that contribute to carbon neutrality, such as biomass raw materials) and develop technologies for energy conservation, GHG emissions reduction, and resource
conservation when using our products and technologies that contribute to CCU (Carbon dioxide Capture and Utilization). The roadmap is shown on the page for information disclosure
based on recommendations by the Task Force on Climate-related Financial Disclosure (TCFD).
Monozukuri Transformation (Manufacturing Innovation)
As part of the Reformation of Existing Business set out in the New Medium-Term Management Plan, we have been working to reform the operational process throughout the supply chain
based on digital transformation (DX). The production and research teams work together to promote initiatives that lead to carbon neutrality, such as a fundamental review of the
production process for existing products and the use of low-GHG raw materials.

Products using biomass
Bio-based raw materials (biomass*) are renewable and sustainable raw materials compared to petrochemical raw materials. Thus, petrochemical raw materials have been increasingly
replaced by biomass raw materials. Basic chemicals, such as acrylic acid and ethylene glycol, have also been increasingly derived from biomass. Defossilization of raw materials (a shift
to biomass) is expected to accelerate into the future. In fact, we have developed superabsorbent polymers, which have acquired the Biomass Mark, and polyethylene glycol, which has
been certified under the ISCC system.
Click here

for products using biomass* Biomass: A concept that represents the amount (“mass”) of biological resources (“bio”). Biomass refers to “renewable, bio-based organic resources excluding petrochemical raw materials.” Unlike CO2
released from the combustion of petrochemical raw materials, CO2 released from the combustion of biomass is CO2 absorbed from the atmosphere through photosynthesis during the growth process ofliving organisms. Thus, biomass is regarded as “carbon neutral” resources that do not emit additional CO2 into the atmosphere.

Support Initiatives

Initiative

Sponsoring organization

TCFD

Tas k Forc e on Climate-related Financ ial Dis c los ure

Keidanren Challenge Zero

Keidanren (J apan Bus ines s Federation)

GX League

Minis try of Ec onomy, Trade and Indus try

2050 Zero CO2 Emissions from Kyoto OrdinanceKy oto City

32

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Fluorocarbons
Fluorocarbons were heavily used in the mid-20th century as refrigerants and solvents, but it became apparent that fluorocarbons were the causative substance for ozone depletion andwere greenhouse gases. Today, substantial restrictions have been imposed on the use by various international agreements and laws, such as the Montreal Protocol.
In Japan, the Fluorocarbon Emissions Control Act was enacted in 2015. In this law, companies who use the air conditioners and refrigerators/freezers including fluorocarbons as arefrigerant are obliged to inspect the devices and report the fluorocarbons leak volume. Our domestic facilities own about 800 devices and annually inspect them in accordance with thelaw. The total of fluorocarbons leak volume level in FY2022 was 102 kg (of this amount, 20 kg was the leakage ozone depleting fluorocarbons), and this was 339 tons of CO2 equivalent.

33

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Disclosure based on TCFD recommendations

GHG emission reduction and energy savings

Disclosure based on TCFD recommendations
As a chemical manufacturer, the Sanyo Chemical Group uses fossil fuels in its manufacturing processes for various products and emits CO₂. For this reason, it focuses on reducing
CO₂ emissions from business sites, and aims to achieve carbon neutrality by developing and spreading the use of products that contribute to energy conservation and CO₂
emissions reduction.
Considering that response to climate change is an important management issue, we showed support for the recommendations by the Task Force on Climate-related Financial
Disclosures (TCFD) in December 2021.
Assessing the risks and opportunities that climate change may pose to Sanyo Chemical, we will proceed with initiatives based on our scenario analysis. We will actively work on
initiatives across the Group toward a “50% reduction in CO₂ emissions by 2030 (compared to the FY2013 level) and net zero by 2050,” which are the targets of our Sustainability
Action Plan, while aiming to reduce emissions across the supply chain.
Recommendations by the Task Force on Climate-related Financial Disclosure (TCFD) require information disclosure regarding the governance, strategy, risk management, andmetrics and targets of climate change. Our Group has been taking action in line with the TCFD recommendations.

Governance
Since FY2021, the Sustainable Management Committee (chairperson: President and CEO) has been in place to study appropriate response to issues that may pose management
risks, including climate change, and to make decisions under the supervisory system of the Board of Directors. The committee discusses the response to TCFD recommendations
and reports important matters to the Board of Directors.
The CSR Promotion Management Committee formulates and implements specific measures to reduce CO₂ emissions. The committee builds systems and mechanisms and reports
the status of CSR activities, which are conducted under the initiative of the committee, to the Sustainable Management Committee.

Strategy
The Group conducts scenario analysis as the first step toward formulating the strategy, risk management, metrics, and targets for climate change. We selected business risks andopportunities in the 1.5°C scenario, which aims to achieve a shift toward a decarbonized society, assessed their importance, and compiled their impact on the Group. The scope ofanalysis was the business of the Company and SDP Global Co., Ltd.
We conducted a qualitative scenario analysis of the Group's major business areas, including the Toiletries & Health Care, Petroleum & Automotives, Plastics & Textiles, Information& Electrics/Electronics, and Environmental Protection & Construction. The assessment results were discussed by the Sustainable Management Committee and reported to theBoard of Directors.
The scope of analysis will be expanded to our Group companies, and the 4°C scenario will be assessed to formulate measures.
The 1.5°C scenario
Referring to the scenario of strong control of CO₂ emissions to limit temperature rise to "+1.5°C" (the long-term outlook "Net Zero Emissions by 2050" at the International Energy
Agency), we considered tighter regulations and major social and market transformations as the central scenario of transition risk. The scenario was based on the following
assumptions.

34

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

・Top priority placed on the realization of a decarbonized society, and implementation of an ambitious climatechange policy
・Significant increase in the carbon tax rate
World anticipatedin the 1.5°C scenario

・Prohibition of internal combustion engine (ICE) sales, shift to electric vehicles (EVs), and decarbonization ofenergy and raw materials
・Mainstreaming of renewable energy

・Reduction in consumption of chemicals through recycling

・Manufacture of chemicals from biomass and CO₂-derived raw materials
・Exacerbation of natural disasters

・Realization of carbon neutrality (2050)

Risk management
We anticipate tighter regulations due to policies, including carbon pricing toward decarbonization, and a shift in demand for materials suitable for decarbonization as the main
climate change risks of the Group. We also study the risks of the accelerated shift toward a circular economy, and the emergence of innovative technologies toward a decarbonizedsociety.
As countermeasures, we will study the possibility of carbon dioxide capture and utilization (CCU) and energy shift to hydrogen, etc. t the Nagoya Factory and the Kashima Factory,
and in the SDP Group, which account for a large proportion of the CO₂ emissions of the Group. We will also improve the processes and reduce CO₂ emissions from our businesssites.
Regarding opportunities, we contribute to reducing CO₂ emissions by actively promoting sustainable management, including the review of our business portfolio.

The Group’s countermeasures to the main risks and opportunities of climate change
The Group’s countermeasures to the main risks and opportunities and the results of impact assessment were compiled. Regarding the impact assessment, the impact in terms of
the amount of money was estimated and classified into three categories (high, intermediate, and low), depending on the magnitude.

Climate change
risk item

Introduction / raisingof carbon tax

Reduction of CO₂
emissions

Impact of climate change risks● Risk
〇 Opportunity

Impactassessment●Increase in energy procurement costs〇Spread of CCUS

High

High

●Restrictions on CO₂ emissions during use
Replacement with
low-carbon products

Recycling regulations〇Market expansion of products madefrom bio-based raw materials●Increased costs due to the increased
use of recycled raw materials〇Increase in demand for recyclable
products

Intermediate〇Increase in sales of electric vehicles●Reduction of GHG emissions during the manufacture of SAP
through energy management〇Expansion of sales of carbon fiber convergents for blades forwind power generation〇Expansion of sales of surfactants made from bio-based raw
materials〇Development of imaging materials using recycled PETIntermediate〇Development of chemical recycling technology for urethane〇Deployment of resin dispersants for recycled materials /organic filler dispersion●Increase in sales of lubricant additives that contribute to higher
fuel efficiency of gasoline-fueled and hybrid vehicles●Decrease in sales of gasoline-fueledand hybrid vehicles
Changes in consumer
behavior●Reduction of GHG emissions by introducing cogeneration andsolar power generation〇Establishment of a CCU system using our ionic liquids●Tightening of GHG emission regulations〇Expansion of the market for products that
contribute to reducing GHG emissions

Countermeasure

High〇Reduction in weight of batteries inline with the higher mileage of vehicles〇Increase in sales of electrolytes in line with the electrificationof vehicles〇Increase in demand for permanent antistatic agents for IC trays
in line with increasing demand for semiconductors〇Development of organic cathodes for organic cathodesecondary batteries that contribute to weight reduction

35

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Metrics and targets
Target of CO2 emissions reduction■ Emissions (Scopes 1+2)
The Group set long-term targets to achieve net zero CO₂ emissions by 2050 in Scopes 1 and 2*, and created a roadmap to reduce CO₂ emissions by 50% by 2030 (compared to the
FY2013 level). We aim to reduce CO₂ emissions significantly by introducing CCU in addition to increasing energy use efficiency through the use of renewable energy and theintroduction of an energy management system, reviewing the manufacturing processes, and changing the product portfolio.

・ Emissions are expected to increase during theperiod of the new medium-term management
plan (FY2023-FY2025) as production volume
increases, but we will continue to improve
manufacturing processes and reduce CO₂.
・ A 50% reduction is targeted for FY2030(compared to FY2013) through the use of
CCUs and green hydrogen.

Roadmap toward carbon neutrality
We aim to reduce GHG emissions significantly by introducing CCU in addition to GHG emissions reduction measures, including energy transition (introduction of energy management, introduction of solar power generation and green hydrogen, and expansion of cogeneration), review of the manufacturing process, and changes in the product portfolio.

Emissions through the supply chain (Scope 3)
We will also set metrics to promote sales expansion and the development of products that contribute to the reduction of CO₂ emissions, and will work on the reduction of CO₂
emissions in Scope 3 (emissions through the supply chain). Starting in FY2022, we use a standard questionnaire tool (common SAQ) formulated by the Global Compact Network
Japan to reduce CO₂ emissions through the supply chain.

Toward the future
We will continue to conduct scenario analysis in line with the recommendations by TCFD, quantitatively evaluate the impact of climate change, and expand the scope of evaluation
to Group companies. We will also practice PDCA by periodically reporting the review results to the Board of Directors and holding deliberations each year to disclose information
about target setting and progress.

36

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Chemical Substance Control
As a chemical company, the Sanyo Chemical Group handles many chemical substances in its business activities. Chemical manufacturers are required to endeavor to ensure
environmental protection, safety, and health throughout the entire lifecycle, including product development, manufacture, logistics, and use/disposal of products sold, and to minimize thenegative impact of chemical substances.

PolicyThe chemical substances management regulations stipulate that “regarding chemical substances handled in business activities, we ensure proper management in compliance with
relevant laws and regulations, etc. in and outside Japan by taking into account the impact on the global environment, ecosystem, and human health and social trends in Japan and theglobal community.” Management targets are all chemical substances contained in products that are manufactured at business sites, raw materials, intermediate products, recoveredmaterials, and waste, as well as chemical structure designs and process designs in R&D.

Bodies related to management of chemical substances and their roles
The General Manager of the Responsible Care Division serves as the supervisor. Respective divisions collaborate under the leadership of the General Manager to manage chemical
substances. Discharge into the environment due to in handling in production activities is managed by the Production Division. Design management related to the product composition andmanufacturing processes is undertaken through cooperation between the research department affiliated with a business division and the Production Division.

Headquarter

Responsible
Care Division

Main responsibility
・Confirmation of c omplianc e with laws and regulations in and outs ide J apan and c onformity to the indus try s tandards , c ustomers’
proc urement s tandards , etc .
・Confirmation of proper management in terms of s afety /ac c ident prev ention, labor s afety and health, and the env ironment and safety
・Manufac turing proc es s des igns , c ompos ition des igns , and prov is ion of produc ts in ac c ordanc e with c hemic al s ubs tanc es

Each Business
Divisionmanagement regulations
・Collec tion of information about trends in the indus try, c us tomers ’ proc urement s tandards , etc . and the prov is ion of c onforming
produc ts
・Provis ion of information about c hemic al s ubs tanc es to c us tomers

GlobalPurchasing
Division・Promotion of green proc urement of raw materials (dis s emination of information about our proc urement s tandards and ac quisition of
information about management of c hemic al s ubs tanc es )・Storage, proper management, and us e in ac c ordanc e with laws and regulations

Production
Division・Collec tion of s afety information about raw materials and produc ts (e.g., SDSs )・Identific ation of ris k s during handling, and planning and implementation of ris k reduc tion meas ures・Calculation (meas urement) and reduc tion of the dis c harge and migration amount during s torage and us e・Confirmation of impac t on c hemic al s ubs tanc es management due to c hanges in produc tion c onditions

37

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Safe and appropriate handling of chemical substances
Status of qualifications in Japan

Our Group handles various chemical substances in its operations. Thus, it is essential toacquire knowledge about physical properties and the harmful effects of chemical

Qualification

substances. Regarding substances handled, respective departments organize workshops
using safety data sheets (SDSs) and conduct risk assessment. Employees areencouraged to acquire qualifications for handling specified chemical substances whose

March, 2023
Number of qualified
people (persons)Hazardous materials engineers *1

1,242

harmful effects are particularly high, organic solvents, poisonous and deleterious
substances, and hazardous materials for preventing fire and accidents. Plant engineers atfactories are required to acquire qualifications as Class A hazardous materials engineers or

People/persons in charge of handling poisonous anddeleterious substances

21

Organic solvent work chiefs

517

Specified chemical substance work chiefs

466High pressure gas production safety managers

224

Pollution prevention managers *2

53Class B hazardous materials engineers (Group 4).

Total number of qualified people in factories and research laboratory*1 Total number of dangerous goods handler class A and/or class B (Otsu1-6)*2 Total number of pollution prevention manager; air, water, noise, and dioxin

Design management
When designing a product, it is necessary to translate the “functionality and performance” to meet the target needs into physical and chemical “properties,” and design the chemicalcomposition to demonstrate the “physical properties.” To minimize the impact on individuals during the manufacture and use of products and their discharge into the environment and toensure safety, examinations and checks are conducted from various viewpoints in the respective phases of composition design, process design, prototype production, andcommercialization of products.
Inspections through research and development

Click here

for more information about considerations regarding harmful chemical substances used for products.

The page introduces products designed by giving consideration to the prevention of pollution and reduction of content based on the keywords of “solvent-free,” “halogen-free,” “freefrom harmful substances,” and “environmental residue.”38

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Discharge management
To reduce the negative impact of chemical substances discharged from production activities on the atmospheric, aquatic, and soil environments, we ensure compliance with laws andregulations and work on voluntary activities to reduce the discharge.
Conservation of the atmospheric environment
Business sites discharge combustion gases into the atmosphere (e.g., NOx, SOx) due to the use of boilers, cogeneration systems, and incinerators and volatile organic compounds(VOCs) generated from the operation of reaction tanks and storage tanks at plants. We endeavor to reduce the impact on the atmospheric environment through the maintenance andproper operation of such equipment and ancillary exhaust gas treatment equipment. Regarding VOCs, the targets for the final fiscal year (FY2024) of the Environmental Action Plan are
80 tons or less in Japan and 10 tons or less overseas. In FY2022, VOC emissions were 66 tons (−7 tons from the previous fiscal year) in Japan and 8 tons (−9 tons from the previous
fiscal year) overseas, adding up to 74 tons for the entire Group and attaining the FY2024 targets.

Note 1: The overseas values of NOx, SOx, and soot and dust in FY2019 were high because abnormal measurement values were recorded at SDP GLOBAL (MALAYSIA) SDN. BHD. We checked theequipment and measurement methods. The values are normal in FY2020 and beyond.
Note 2: Scope of aggregation of VOCs: All the business sites in Japan and Sanyo Kasei (Thailand) Ltd. in FY2018. Sanyo Kasei (Nantong) Co., Ltd., San-Dia Polymers (Nantong) Co., Ltd., and SDP
GLOBAL (MALAYSIA) SDN. BHD. were added in FY2019.

39

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Conservation of the water environment
At the wastewater discharge pipes at business sites, voluntary management values stricter than the wastewater regulation values stipulated in laws and regulations are in place tomanage the concentration by monitoring the status of wastewater.
We endeavor to prevent the discharge of pollutants into the aqueous environment through the appropriate maintenance of equipment, installation of dikes, and measures to prevent
leakage at business sites.
Click here

for information of discharge and environmental impacts.

Nagoya area (Nagoya Factory, SDP Global Co., Ltd. and San Nopco Ltd.) discharge to Ise Bay, and Kawasaki area (San Chemical Co., Ltd.) discharge to Tokyo Bay. Other facilities
discharge to sewerage system.

Environmental conservation for soil and ground water
We do not perform landfill disposal at business sites. We also monitor the condition of ground water using observation wells at business sites. We conduct a voluntary soil survey onhouse premises during construction work to check for problems on an ongoing basis.

40

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Compliance with the PRTR Law
In Japan and Thailand, a system is in place to notify the amount discharged to the environment and the migration amount in accordance with the PRTR Law.
Our Group has been working to reduce the discharge by determining the amount of VOCs outside the scope of the PRTR Law in addition to the amount of substances covered by thelaw discharged from business sites, and setting priorities.
In FY2022, we started to implement measures to reduce the discharge of chloromethane, whose discharge amount was the largest among the VOCs discharged in Japan, but against
which no effective measures had been implemented.
We succeeded in reducing the amount of chloromethane, which had been excessively used, by improving the manufacturing process. In FY2022, consumption was reduced by about 2
tons. This is equivalent to a reduction in the discharge amount by up to 8.8 tons per annum. In overseas operations, the discharge amount will be reduced through combustion andadsorption treatment of exhaust gas by using discharge reduction technology refined in the operations in Japan.

Substances subject to PRTR Law in FY2022 (domestic facilities)
Number of handled
substances

Volume(tons)

Emissions toair(tons)

Emissions towater(tons)

Emissions tosoil(tons)

Transferred towaste(tons)

Sanyo Chemical

121

102,292

35.5

0.3

0

507.7

Domestic subsidiaries andaffiliates

57

129,195

6.0

0.0

0

9.5

131 in total

231,487

41.5

0.3

0

517.2

Total
Click here

for emissions / transfer data, and emission reduction measures.

Compliance on environmental matter
In FY2022, we did not receive any complaints about pollution, violate any law or regulation related to the environment, or have administrative direction or any lawsuits.

41

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Resource Saving and Waste Reduction

PolicyWe work on the 3Rs (reduce, reuse, and recycle) for the effective use of resources. In particular, we focus on reduction of waste generation.

Targets and results
Waste generation volume and recycle rate
The waste generation volume of 74 thousand tons in 2007 decreased to the 60 thousand ton-range in the late 2010s, because domestic factories, which generated the majority of waste
in our group, worked hard to meet the challenge using our company-wide challenge system. In Japan, the amount of waste generated has been decreasing since FY2017 due to changes
in the product mix, attributed to changes in the sales policy, and reduction in the production volume in addition to waste reduction measures. In FY2022, the amount of waste generated
was 44,000 tons (35,000 tons in Japan and 10,000 tons overseas), which fell slightly short of the plan for the fiscal year due to an increase in the amount of waste generated by overseas
subsidiaries and affiliates.
The recycling rate relative to the amount of waste generated is on the decline. It was found that part of waste commissioned to external treatment in FY2022 had not been thermallyrecycled, resulting in a recycling rate of 26%. The data on waste may not be accurate, so a retroactive review will be studied in FY2023. The landfill disposal volume is kept below 0.01%
of the total volume of waste generated. There were 10 out of 13 facilities with zero landfill volume.
As the reduction of the volume of waste generated also leads to a reduction of CO 2 emissions resulting from incineration disposal, we will address it as an important issue.

ENVIRONMENTAL ACTION PLAN
Waste generation volume

21-24

FY2024 target

FY2022 target

36 thous and tons or les sNote: A; Excellent B; Good C; Bad

42

41 thous and tons or les s

FY2022 result

Rating44 thous and tons

B－C

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Resource saving and waste reduction
Material flow of waste in FY2022

Our Group generates a large amount of waste in which organic matter is mixed with water, including water produced after cleaning equipment and products and waste fluids generated in
the manufacturing process. Such waste is not suitable for recycling. The amount of waste subject to internal and external weight reduction mainly by incineration accounts for 45.3% and28.5%, respectively. About a quarter of the waste generated is recycled internally and externally.

Reduction of waste generation
In FY2018, the Management Policy was changed to stop sales of low-value-added products and shift the focus to sales of high-value-added products. This caused our product mix tochange and resulted in a decrease in the production volume at business sites in Japan, which had been generating a large amount of waste. These measures turned out to be effective.
Other measures were also implemented to reduce the generation of waste, such as optimization of the input of raw materials (reduction), improvement of the yield, and review of thefrequency and method of cleaning equipment. The basic unit of waste generation per production volume has decreased.

Examples of recycling
In FY2022, about 3% of waste generated was recycled internally, while 24% was recycled externally.
(Specific examples)・Solvents used for cleaning equipment are constantly reused in-house.
・Of solvents and monomers recovered from the production process, recyclable solvents and monomers are purified for reuse.
・Metals, wood, paper, and other materials are subject to external material recycling.
・Some waste plastics are subjected to external material recycling. Most waste plastics are subjected to thermal recycling.

43

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Contribution through products
We offer product linesthat contribute to the sustainable use of resources categorized by the keywords of “weight reduction,” “low additive amount,” “long service life,” “high durability,”“increased yield,” and “use of biomass (from petrochemicals).”
Contribution through superabsorbent polymers (SAPs)
Recently, efforts have been made to recycle disposable diapers, which have been increasing as general waste. One of the issues in recycling and treatment is dehydration, volume
reduction, and recovery of SAPs, which are used as water-absorbing materials in disposable diapers. SDP Global Co., Ltd. developed SANWET DH, an SAP whose dewaterability has
been improved while maintaining its water-absorbing and water retention performance as a water-absorbing material by harnessing polymerization technology, particle shape control
technology, and surface treatment technology. Compared to conventional products, SANWET DH is characterized by higher dewaterability (improved by 30%), shorter dewatering time,and easier separation from other materials during recycling.

SAP that absorbed water was immersed in a calcium chloride solution for 10 minutes. It was then dehydrated for 90 seconds in a centrifuge.

We also started the shipment of samples of SAPs that contained plant-derived biomass raw materials (10% or 25%) and acquired the Biomass Mark.

Information about the reduction of discharge and recycling of industrial waste products using plastics
We fall under the category of business operators that discharge a large amount of waste (250 tons or more per annum), as stipulated in the Act on Promotion of Resource Circulation for
Plastics. The status of discharge of industrial waste of products using plastics is as shown in the table below. Subsidiaries and affiliates in Japan do not fall under the category ofbusiness operators that discharge a large amount of waste. However, they have been working to reduce discharge while sharing information with Sanyo Chemical. Part of the discharged
waste is recycled as road base materials and raw materials for plastic products. Most of such waste is subject to thermal recycling.
Emissions status and reduction target of waste products using plastic(unit : tons)
Emission volume (domestic SUBSIDIARIES & AFFILIATES*)

Emission volume (Sanyo Chemical)
FY2021

1,061

48

target1,052

46

result

959

52

1,185

48

FY2022

FY2023 target* SDP Global Co., Ltd., San Chemical Co., Ltd., SAN NOPCO LIMITED, and San-Petrochemicals Co., Ltd.

44

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Maintenance and management of industrial waste management facilities information
Based on the Act on Waste Management and Public Cleansing Article 15-2-3-2 in japan, we show the following status of maintenance and management of industrial waste management
facilities.
Nagoya Factory（Tokai, Aichi prefecture, Japan）liquid combustion furnace
The status of maintenance and management of industrial waste management facilities

File (Japanese PDF only)

The status of maintenance

PDF

Management of industrial waste management facilities (FY2023)

PDF

Management of industrial waste management facilities (FY2022)

PDF

Management of industrial waste management facilities (FY2021)

PDF

Management of industrial waste management facilities (FY2020)

PDF

Management of industrial waste management facilities (FY2019)

PDF

Nagoya Factory（Tokai, Aichi prefecture, Japan）garbage incinerator
The status of maintenance and management of industrial waste management facilities

File (Japanese PDF only)

The status of maintenance

PDF

Management of industrial waste management facilities (FY2023)

PDF

Management of industrial waste management facilities (FY2022)

PDF

Management of industrial waste management facilities (FY2021)

PDF

Management of industrial waste management facilities (FY2020)

PDF

Management of industrial waste management facilities (FY2019)

PDF

45

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Biodiversity Initiatives

In its business activities to manufacture and sell chemicals, the Sanyo Chemical Group has a negative impact on biodiversity, such as through the consumption of natural capital, GHG
emissions, and the discharge of harmful substances in the lifecycle from the design and development of products, including the procurement of raw materials, the manufacture of
products, transport, product use, and final disposal. However, we also recognize that the products that we offer have a positive impact in contributing to the reduction and improvement ofenvironmental impact. We have worked on activities based on a belief that commitment to a reduction of impact at each stage of the lifecycle, including through energy conservation andreduction of GHG emissions and discharge of pollutants in production activities, energy conservation and reduction of GHG emissions during product use, reduction of harmful
substances contained in products, use of biodegradable materials, and non-use of endocrine disrupters for disposal help prevent biodiversity loss, albeit indirectly.
In 2009, we revised the Management Policy on responsible care by adding biodiversity and launched the Sanyo Chemical Woodland project for the purpose of supporting the Kyoto
Model Forest Movement. We work on the project on an ongoing basis.

PolicyThe management policy regarding responsible care sets out the goal to “deepen understanding and recognition about biodiversity conservation and promote biodiversity-conscious
activities,” and defines an activity policy on biodiversity.

Action Policy Concerning Biodiversity
With the acknowledgement that business affects biodiversity, our group will deepen the understanding and acknowledgement of the preservation of biodiversity andpromote our activities with consideration for biodiversity.
1. We will develop products in consideration of the environment and contribute to the preservation of biodiversity through the provision and diffusion of those products.
2. In the procurement of materials, raw materials, office supplies, and others, we will give consideration to the preservation of biodiversity.
3. We will reduce the environmental loads, such as the emissions of greenhouse gases, utilization of water resources, and release of chemical substances and waste,from the workplaces so as to alleviate their impact on biodiversity.
4. All of our employees will enhance the understanding and acknowledgement of biodiversity and try to increase the awareness of the preservation of biodiversity.
5. We will promote efforts in cooperation with the local community.
(Established: 2013)

Involved Initiatives
Declaration of Biodiversity by Keidanren, Japan Business Federation

Roundtable on Sustainable Palm Oil (RSPO)** RSPO: An NGO established by the World Wide Fund for Nature (WWF) and other organizations in 2004 to produce palm oil while ensuring sustainability by giving consideration to environmental issues, suchas logging in rain forests and the shrinking of habitats for wildlife caused by logging, as well as poor working environments and human rights issues on farms. RSPO establishes principles and standards on
the production and use of palm oil. It started operating a certification system for palm oil in 2007. Various members participate from across the supply chain, including palm oil producers, traders, andprocessors.

Education and training
The Sanyo Chemical Woodland project, which is organized by employees who serve as volunteers, raises awareness about biodiversity through forest management, observation oforganisms, and forest learning. Since 2010, forest creation activities have been part of the training curriculum for new employees. Employees are required to experience the activities atleast once after joining the company. Since the launch of the activities in 2009, a total of 2,019 employees have participated (including 576 employees who have participated in the training
for new employees). Forest Maintenance News, an in-house newsletter that carries basic articles about the activities and biodiversity, is posted on our Intranet to raise awareness aboutbiodiversity.

46

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Action on the activity policy
Products that contribute to reduction of environmental impact
We develop and market product groups that contribute to biodiversity by achieving energy conservation, improving energy efficiency, and ensuring durability, long service life (resource
conservation), water conservation, removal of harmful substances, non-use of harmful substances, and biodegradability.
Click here

for products that contribute to reduction of environmental impact

Regarding protein synthesis using genetically modified organisms, we ensure biosafety so that organisms are not released into the environment. In the field of agri-nutrition (agriculture),
which we are about to enter, we are studying the possibility of reducing the use of fertilizers and pesticides, whose environmental impact is high, by efficiently delivering components
essential for plants (e.g., peptides and amino acids) and fully unleashing the yield and quality potential inherent in plants. Reduction in the use of fertilizers and pesticides is expected toreduce the environmental impact during the manufacture of these products and the negative impact on organisms other than the target organisms due to excessive use.

Procurement of raw materials
Since our foundation in the surfactant industry, we have handled bio-based raw materials, including oils and fats. Later, we expanded our business to the petrochemical industry. Although
the percentage of bio-based raw materials has decreased, we still use a considerable amount of bio-based raw materials. Regarding raw materials used, we determine whether they arebio-based and identify the species from which they are derived. We purchase oils and fats, higher alcohols, and fatty acids (derivatives) derived from oil palm, coconut palm, rapeseed,soybeans, cattle, and pigs. In FY2023, we started to procure raw materials derived from RSPO-certified palm oil as raw materials for cosmetics. Our group specifies biodiversity
conservation and sustainable use in the Sustainable Procurement Guidelines, which are presented to suppliers to seek their understanding. The status at suppliers is checked throughCSR questionnaires.

Reduction of environmental impact
We endeavor to reduce the biodiversity risk through environmental impact reduction activities in accordance with the Environmental Action Plan, environmental considerations based on
the chemical composition design of products, and the provision of compliant products.

Awareness raising of employees and collaboration with local communities
The Sanyo Chemical Woodland project (Yubune district, Wazuka Town, Soraku-gun, Kyoto Prefecture)
We provided funds to the Forest Creation Fund of the Kyoto Model Forest Association to contribute to the development of a healthy forest through a tree-thinning project in Wazuka Town,
Soraku-gun, Kyoto Prefecture. The project helps conserve species, increase CO 2 absorption by forests, cultivate water sources, and prevent flood damage. In collaboration with local
governments, including Wazuka Town, our employees and their families as well as retirees participate in forest management of Yubune Forest Park as volunteers to raise awarenessabout biodiversity and ensure communication with local communities. We also make donations to the Keidanren Nature Conservation Fund every year.
Click here

for forestry activities

47

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Water Resources

The Sanyo Chemical Group uses water resources in various aspects of manufacturing chemical products. We believe that it is our mission to endeavor to conserve water and reducewater pollution through wastewater discharged from our business sites.

PolicyWe work to reduce water consumption as one of the targets of our Environmental Action Plan 21-24.
Regarding reduction in discharge of water pollutants, we meet the values set in laws and regulations by preventing leakage at business sites and monitoring pollutants in wastewater.

SystemThe Energy Conservation Promotion Dept. of the Responsible Care Division serves as the secretariat to manage the progress of measures, such as water conservation at respective
business sites, and shares the information. The resulting measures are also deployed to overseas business sites.

Water consumption targets and results (domestic and overseas)

Water
consumption

FY2024targetFY2022targetFY2022
resultLess than 4,136 thous and m 3 ; 5% ormore reduc tion c ompared to FY 2019

Les s than 4,223 thous and m 3 ; 3% ormore reduc tion c ompared to FY 2019

Les s than 4,333 thous and m 3;
0.5% reduc tion c ompared to FY
2019

Reduction ratio
from FY2019

5% or more

3% or more

RatingB－ C

0.5%

Note: A; Excellent B; Good C; Bad

Reduction of water consumption
Regarding water consumption within our Group, industrial water accounts for about 90%. Industrial water is mainly used for manufacturing equipment and auxiliary equipment such asheating, cooling, and cleaning water as well as for wastewater equipment. Drinking water is used as a polymerization solvent and dilution water for products. It is also used for thecleaning of products, intermediate products, and manufacturing equipment. No groundwater or seawater is used. The production volume in FY2022 decreased by about 10% from theprevious fiscal year. However, the consumption of heating and cooling water in manufacturing equipment and auxiliary equipment is not affected by increases or decreases in production
volume. Water consumption decreased slightly in Japan and increased slightly overseas, adding up to 4,333 thousand m3 in total (an increase of 1% from the previous fiscal year).

48

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Water conservation and recycling
Polymerization water for polymer production and cleaning water for products and intermediate products are used repeatedly as much as possible. Steam drainage is reused as water.
Water conservation and recycling themes are determined for respective business sites to reduce consumption.

Reduction of water pollutants discharge
While preventing leakage at business sites, we monitor the concentration of pollutants in wastewater to ensure management within the regulation values set by laws and ordinances.

49

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Discharge area and environmental impact (domestic, FY2022)
Unit

Nagoya area

Kashima area

Kyoto area

San Chemic al Co.,Ltd.

Kas hima Fac tory,
San-Petroc hemic als
Co., Ltd.

Ky oto Fac tory,
Head Offic e,
Res earc hLaboratory, Kats ura
Res earc hLaboratory

Is e BayTok y o Bay

Sewage s y s tem

Sewage s y s tem

Nagoy a Fac tory,
SDP Global Co,.
Ltd.,San Nopc o Ltd.

Facilities

Discharge area

Kawasaki area

Kinuura area

Kinuura Factory

Sewage system

Waterdischarge
volumethousand
m3

1,924

116

838

144

1

COD

tons

10.9

2.9

127.4

1.2

0.0

Total
Phosphorus

tons

0.3

0.0

0.6

0.1

0.0

Total
Nitrogen

tons

1.4

0.3

1.9

0.4

0.0

Products that contribute to the conservation of water resources and the water environment
We offer a lineup of products categorized by the keywords of water conservation, wastewater treatment, and biodegradability, including raw materials for water-conserving compact
detergents and polymer flocculants for wastewater treatment.
Click here

for products that contribute to reduction of environmental impact

50

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Respect for Human Rights

Since the 2000s, with the advancement of globalization of corporate activities, raw materials have been procured through various supply chains. In this situation, it has come to be
noticed that such corporate activities affect labor and human rights in unexpected countries and regions. As a result, there has been an accelerated movement to require companies tomanage their business in a way that respects human rights.
The Sanyo Chemical Group has set its Vision 2030: “Grow into a global, unique, and highly profitable company where every employee feels pride and satisfaction from his/her work.” We
believe that the success of diverse human resources is possible only when there is a foundation for understanding the human rights of each individual and recognizing their individuality
and values. In addition, in order to advance our business activities in various regions of the world, we are required to address human rights issues, including labor-related rights forstakeholders involved in our business activities and throughout our supply chain. To address human rights issues, we formulated the Sanyo Chemical Group Human Rights Policy inMarch 2023. Going forward, we will proactively disclose information to reduce human rights risk both inside and outside the company, and promote initiatives such as establishingsystems for human rights due diligence and remedies.

Human Rights Policy
Our human rights policy is as follows.

Sanyo Chemical Group Human Rights Policy
1. Basic attitude
As corporate activities become increasingly globalized, companies are expected to take the initiative in eliminating human rights violations from the perspective of creating
an inclusive society. The Group will conduct management that respects the human rights of all people and recognizes that its business activities may have a negative
impact on human rights. At the same time, we will work with our customers, business partners, suppliers, and government agencies to avoid such negative impacts,
thereby gaining recognition from investors, customers, and society at large. We will also cooperate with diverse stakeholders to support the socially vulnerable.

2. Scope of application
This policy applies to all executives and employees of the Sanyo Chemical Group. The Sanyo Chemical Group will continue to encourage its customers, business partners,
and suppliers to support this policy and participate in similar initiatives, and will work together to promote initiatives to respect human rights.

3. Responsibility to respect human rights
The Sanyo Chemical Group will fulfill its responsibility to respect human rights by not infringing on the human rights of those affected by its business activities and by taking
appropriate measures to correct any adverse impact on human rights that its business activities may cause. If any adverse impact on human rights is caused by ourcustomers, business partners, and suppliers, we will demand them to take appropriate action.

4. Compliance with applicable laws and regulations
The Sanyo Chemical Group will strive to understand internationally recognized human rights norms and the relevant laws and regulations in each country, including those
stipulated in the following documents. Where local national laws and regulations are incompatible with internationally recognized human rights norms, we will seek ways torespect the latter.
・International Bill of Human Rights: Universal Declaration of Human Rights and International Covenants on Human Rights (International Covenant on Civil and Political
Rights / International Covenant on Economic, Social and Cultural Rights)
・International Labour Organization’s (ILO’s) Core Labour Standards (child labor, forced labor, freedom of association and the right to collective bargaining, elimination of
discrimination in employment, etc.)
・United Nations “Guiding Principles on Business and Human Rights”
・OECD Guidelines for Multinational Enterprises
・United Nations Global Compact (voluntary efforts of companies based on the Ten Principles in the areas of human rights, labor, the environment, and anti-corruption)
・ISO26000 “Guidance on social responsibility”
・Japanese government “Guidelines on Respect for Human Rights in Responsible Supply Chains”
・UK Modern Slavery Act

5. Human rights due diligence
The Sanyo Chemical Group will establish a human rights due diligence system to identify adverse impacts on human rights, conduct preventive surveys and investigations,
implement appropriate measures to correct adverse impact, and continue to strive to prevent and mitigate its adverse human rights impact on society.

51

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

6. Identification of human rights risks
The Sanyo Chemical Group has identified the following three items as outstanding human rights issues, and will continue to address these issues.
・Labor in the supply chain
・Employee safety and health・Human rights risks due to the effects of geopolitical situations and conflicts

7. Prevention and mitigation measures
The Sanyo Chemical Group will not engage in discrimination or acts that undermine the dignity of individuals based on factors such as thoughts, creed, age, social status,
nationality, birthplace, ethnic group, religion, immigration, gender, sexual orientation, gender identity, pregnancy, poverty, disease, and disability. To that end, we will also
strive to understand the issues faced by socially vulnerable people who suffer from discrimination and acts that undermine personal dignity based on these reasons, andcooperate with various stakeholders such as government agencies, local governments, and social welfare organizations to provide support.

8. Corrective and remedial measures
The Sanyo Chemical Group fully recognizes that human rights violations pose a management risk. It will prevent human rights violations and respond fairly andappropriately in the event of any human rights violations. It will not only oppose child labor and forced labor, but will also not use raw materials that are thought to have been
produced by child labor or forced labor. It will also establish a whistleblowing contact point that allows anonymous reporting for internal employees, and will take necessary
measures while appropriately handling the confidentiality of the whistleblowers and reported information. It will prohibit any disadvantageous treatment or retaliation against
whistleblowers, and will ensure their protection.

9. Education
The Sanyo Chemical Group will continue to provide appropriate education to ensure that a correct understanding of this policy is permeated both inside and outside thecompany, and that it is effectively implemented.

10. Information disclosure/engagement
The Sanyo Chemical Group will disclose the status of its efforts regarding Respect for Human Rights. It will also evolve a series of efforts based on this policy throughdialogue and consultation with various internal and external stakeholders.
Established: March, 2023

Human rights due diligence
We have included human rights due diligence in our recently formulated Human Rights Policy to strengthen human rights initiatives.

Human rights considerations in the supply chain
We have clearly stated considerations for human rights in the supply chain in our Sustainable Procurement Guidelines, which were revised in January 2022, to inform our suppliers ofhuman rights considerations. Currently, human rights issues expected to occur in the supply chain are attracting attention around the world, such as the ones listed below. We will act in a
way that ensures that our business activities do not directly or indirectly contribute to or encourage human rights violations.
When procuring raw materials, we strive to follow the procedures detailed in the United Nations Guiding Principles on Business and Human Rights.
Human rights issues in the supply chain

52

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Human rights education and awareness
The Sanyo Chemical Group has clearly stated that it will continue to provide appropriate human rights education to ensure that a correct understanding of its Human Rights Policy,
described above, is permeated both inside and outside the company and that it is effectively implemented. In FY2023, we will consider and implement the following initiatives.
・Human rights education and awareness for employees, etc.
・Consideration of human rights due diligence・Corrective and remedial measures in the event of human rights violations
・Consideration of determination of purchasing prerequisites in the supply chain

Prevention of harassment
Toward the realization of a workplace environment without harassment, we have undertaken various initiatives, such as awareness building and seminars, to prevent harassment. We
will continuously improve our understanding and response on harassment, have a strong mind to “Not allow or commit harassment and not become an innocent bystander,” strive for“open workplaces with good communication” and “safe and easy-to-work harassment free workplaces.” Our group aims to be a company in which diverse human resources with diverse
values can take pride and work with peace of mind.
In particular, to make it easier to consult about matters related to sexual harassment, maternal harassment, and LGBTQ discrimination, the Diversity Promotion Department has acted as
an internal contact point, in addition to the whistleblowing contact point. We have also provided a consultation service at two external institutions with extensive experience in harassment
counseling. In FY2022, four reports were submitted through these whistleblowing channels. We investigated the facts with the utmost care to ensure that whistleblowers are notdisadvantaged. When a problem was identified, we provided guidance and education to the relevant person to rectify the situation. We also used our intranet to encourage all employees
to raise their awareness of human rights.

53

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Occupational Safety and Health/Accident Prevention

Details of a fatal occupational accident on January 15, 2022

Occupational Safety and Health/Accident Prevention

Chemical Group, which runs chemical businesses, is well aware that safety is the foundation of its business activities, and has been striving to achieve accident-free/injury-free
operation. We sincerely regret the occurrence of a fatal accident in January 2022. The Group will redouble its efforts to ensure that all its managers and employees go back to the basics
and remain committed to occupational safety and health and accident prevention in cooperation with its subcontractors.

Details of a fatal occupational accident on January 15, 2022
A fatal occupational accident occurred on the premises of the Nagoya Factory (Tokai City, Aichi Prefecture) of Sanyo Chemical Industries, Ltd. Specifically, an employee of a
subcontractor died during preparation for the resumption of production after periodic equipment repairs. We sincerely pray for the peaceful repose of the employee’s soul, and extend ourheartfelt sympathy to the family of the deceased. We also extend our deepest apologies for the aggravation and distress we have caused to all those concerned.

Background of the accident
During the periodic repairs conducted from December 2021 to January 2022, a manhole* cover of the equipment installed in the building was removed and reinstalled. The cover was not
sufficiently tightened when it was reinstalled. In this state, nitrogen was fed in from the day before the accident to prepare for the resumption of production. This caused nitrogen to leakthrough the gap in the cover, filling the building with nitrogen. The victim passed through the area during this state, and thus the accident occurred. Since the accident, the Group has
been providing full cooperation in the investigation by the relevant authorities.
* An inspection opening for equipment maintenance, etc., allowing a person to enter and exit

To improve essential safety
In response to this fatal accident, the Company established an accident response committee to investigate the cause, among other factors. At the same time, we conducted acomprehensive review of the risk of similar accidents occurring at other factories and research laboratories, and took countermeasures. We will continue to invest in safety measures at
the factories by carrying out ongoing countermeasure works, such as enhanced ventilation and safety confirmation systems. In addition, after investigating the cause of the accident, weestablished a new permanent countermeasures committee, and have been studying ways to improve essential safety, including changing safety awareness.
In December 2022, we established a safety philosophy and a safety policy to ensure the Group’s concerted efforts. We have also developed priority measures in the New Medium-termManagement Plan 2025. We will certainly work on these.

Safety philosophy
We place the highest priority on Safety and Compliance in all our business activities.
Safety policy
Safety comes first. Recognizing that safety is the foundation of our business activities, and with a strong determination to ensure that no one will be injured or will injure
others, we will work on the following as our basic policy.
1. Observance of basic safety rules
2. Execution of health and safety activities
3. Improvement of crisis management capabilities

Fostering a safety-first mind led by the Safety Promotion Department
In order to ensure the implementation of the above initiatives, the Safety Promotion Department was newly established as an organization under the direct control of the President,
incorporating the operations of the Environmental and Safety Administration Department of the Responsible Care Division and the Safety and Technology Education Center. We will fostera safety-first mind by changing safety awareness and deepening and expanding various measures.

54

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Strengthening risk assessment and developing human resources
We will strengthen risk assessment to mitigate risks. We will make long-term efforts to develop human resources capable of identifying risks and formulating mitigation measuresappropriately, thereby improving the capabilities of each workplace.

Expanding safety education to employees including subcontractors
In recent years, increased sensitivity to danger and education on safety behavior have become even more important. The Safety and Technology Education Center at the Nagoya
Factory has already provided hazard simulation programs and rank-based training, but we will further enhance safety education. A curriculum suitable for subcontractors, who work
alongside us at our business sites, will be introduced.

Assessment of factory safety by an outside audit
In order to comprehensively assess our safety challenges and continuously improve our safety, we introduced a safety assessment by the Japan Industrial Safety Competency Center,a non-profit organization, and began the assessment of our Nagoya Factory in May 2023. We will operate it for other factories as well to address our safety challenges.

55

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Occupational Safety and Health/Accident Prevention

Occupational Safety and Health/Accident Prevention

Details of a fatal occupational accident on January 15, 2022

PolicyIn every business activity, we will address safety and accident prevention as the top priority. We will strive to operate with no accidents and no disasters, make contributions to social
safety, protect employees' safety and health, and create a comfortable working environment.

SystemThe Safety Promotion Department, which is under the direct control of the President, instructs and supervises the occupational health and safety and accident prevention in each base.
In case of an emergency, a local emergency task force is established in the region where the emergency has occurred. Should a large-scale earthquake or other wide-area disasteroccur, the Business Continuity Task Force will be set up at the Head Office to implement support and reconstruction activities on a company-wide level under the control of the General
Manager of the Environment and Safety Headquarters designated by the President.
System56

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Status of labor accidents
To achieve zero labor accidents, we are conducting activities under the main themes of risk assessment, creation of a workplace culture in which workers warn each other, thoroughimplementation of recurrence prevention measures, and achievement of safer work environments.
In FY2022, we had one occupational accident involving our employees with lost time and seven without lost time. As for dispatched employees/employees of affiliates, there were threeoccupational accident with lost time and five without lost time. We have investigated the actual causes of the accidents by using the five whys method*, implemented recurrence
prevention measures, and rolled out important countermeasures to all Group factories in Japan and abroad.
* A technique to verify the effectiveness of countermeasures against a certain problem, by examining the direct cause of the problem (why did it occur) and by repeating the question “Why?” to determine theroot cause.

* Frequency rate = (Number of employees subject to accident with lost time) ÷ (total working hours) ×
1,000,000
This value indicates the frequency of accident victims (Group company employees) per 1 million* Severity rate = (labor lost days) ÷ (total working hours) × 1,000
This value indicates the severity of accidents per 1,000 working hours

hours

Safety and Technology Education Center
In 2012, we established the Safety and Technology Education Center at the Nagoya Factory aimed at improving safety education and production technology (the facilities and operations
have now been reorganized under the company-wide Safety Promotion Dept.). The center is equipped with devices for experiencing the dangers of occupational accidents including flight
simulators that reproduce the production equipment, allowing the study of work facility principles and theories. Up to now, education has been provided to more than 3,000 employees ofour company and affiliates. In the center, by making videos simulating accidents that have occurred in our company, safety education is provided to young workers.

Risk assessment
With the revision of the Industrial Safety and Health Act, the number of chemical substances subject to risk assessment will be gradually expanded. We will conduct systematic risk
assessments of target substances handled at our factories and research laboratories, and take necessary risk mitigation measures.

57

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Monozukuri Transformation (Manufacturing Innovation) Promotion Project
Envisioning where we want to be in five or 10 years, under the slogan of the Production Division “Change to be safer, more comfortable, and stronger!”, in order to innovate ourmanufacturing, in April 2021, we launched a project consisting of two project teams, automatization/mechanization (Monozukuri Transformation) and digitalization/work efficiency
improvement (work style reform practices).
However, we decided to conclude this project in March 2023 after reviewing two years of activities, and after selecting themes to be continuously promoted, we will work on these themesat each factory. Going forward, we will proceed with Manufacturing Innovation as a company-wide project aimed at improving productivity and profitability through fundamental
improvements in manufacturing processes. In July 2023, we established the Monozukuri Transformation Center within the Nagoya Factory as an organization to promote this project. At
the center, we have resident researchers, who are responsible for the stabilization of production, process optimization, automatization, and labor saving through genchi genbutsu (going
to see for yourself to thoroughly understand the situation).

Kyoto Factory’s “activities that listen to the opinions of subcontractors” received the Responsible Care ExcellenceAward from the Japan Chemical Industry Association.
There might be something that employees of subcontractors, who are essential to the production activities at the factory,
feel subconsciously but find it difficult to express. In order to respond to this situation, we have started Hospitality Activities
for Subcontractors, in which we make suggestions to subcontractors to make improvements, in addition to our previous
efforts to make improvements in response to their suggestions and requests. Specifically, in addition to the existing rest
areas in the factory, we have installed easily accessible rest areas near the workplaces of subcontractor employees tomake it easier for them to take frequent breaks and drink water. As measures against heatstroke, we have also installed
mist showers and have provided heatstroke prevention goods to workers who work for long hours under the scorching sun.
These efforts to improve labor safety and health have been very well received by subcontractor employees. As a result, in
recognition of the following aspects of these activities, in May 2023, we received the Responsible Care Excellence Award
from the Japan Chemical Industry Association. First, these activities have been undertaken from the perspective of
subcontractor employees. Second, a wide range of opinions from subcontractor employees have been reflected in
improvements to the work environment, including the installation of new rest areas and the implementation of numerous
measures to prevent heatstroke. Third, this has been effective in deepening communication between our employees andsubcontractor employees.

Safety/accident prevention activity
In order to ensure safe business operation and business continuity, we implement countermeasures for interruptions in both hardware and software. Having set the response/action planin case of an emergency, we conduct training in accordance with it.

Unusual situation handling training and emergency response
Training for handling unusual situation and emergency response
In the education/training curriculum implemented at facilities, education concerning environment and safety/accident prevention practical training are incorporated, while we repetitively
conduct emergency drills and other training in case of an earthquake, fire, and leakage regularly. We also conduct training in cooperation with the local community that includes joint
training with neighboring factories of other companies and the local fire departments.
On the Company-wide Safety Day (October 2) established for the purpose of remembering the past serious occupational accidents, we hold various safety-related events in all areas ofeach domestic and overseas facility, including emergency training, disaster drills, emergency notification training, safety patrols, and cautionary lectures on safety while taking
countermeasures against COVID-19.

Kashima Factory: Safety talk by subcontractors

Nagoya Office in SAN NOPCO LIMITED: Safety patrols by managers

58

Sanyo Kasei (Thailand) Ltd.: Safety patrols

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Earthquake countermeasures
Since the Great Hanshin-Awaji Earthquake in 1995, we have continued to reinforce our buildings and production facilities against earthquakes. We have also been working on theestablishment of a BCP (Business Continuity Plan) since 2007, and based on the experience of the Kashima Plant being damaged by the Great East Japan Earthquake in 2011, we
continue to conduct BCP drills and review response manuals and other documents.

Efforts for predictive maintenanceUsing artificial intelligence (Al) and digital transformation (DX), we have started predictive maintenance, which measures and monitors the condition of equipment to replace or repair partsand other components at the appropriate time. As a result, we believe that this will curb unnecessary parts replacement and unexpected troubles compared to the method of periodic
maintenance.
We have also introduced smart glasses that allow skilled workers to view images and give instructions from outside the plant.
Other initiatives at each plant are shared through web-based communication tools and company-wide presentations at safety conventions to help strengthen accident prevention
measures.

Internal environment, safety, and accident prevention audit (RC audit)
Targeting at the factories and research departments, Responsible Care Headquarter conducts audits concerning environment, safety, and accident prevention by visiting each facility
once a year. In FY2022, the department conducted audits for status of horizontal development of accident countermeasures, the observation of compliance with laws and regulations,leak prevention measures, and risk assessment.
As we discontinued the ISO 14001 certification for domestic factories, the audit of the environmental management is also undertaken.

59

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Quality

As a chemical manufacturer, Sanyo Chemical’s mission is to provide products that customers can use with peace of mind. To this end, it is necessary to design products to ensure
safety at the product design stage and manufacture them under reliable quality control, in order to offer them to the market while assuring their quality.

PolicyWe have set out the following in Section 6 (Implementation of PL and product management) of our CSR Guidelines:“Throughout the entire product lifecycle ranging from product development through manufacturing and use to disposal, we will implement product safety measures with top priority placedon safety and conduct strictly product management. We will also provide appropriate information and faithfully respond to inquiries and complaints.”

Organizations related to quality assurance, quality control, and product liability (PL) andtheir roles
Products produced in the Production Division are tested and inspected by the Inspection Dept. within the Division, and quality judgments are carried out by the Quality Management Dept.
(Sect.), which belongs to the Responsible Care Division and is stationed in each factory. In this way, by ensuring independence, we aim to strengthen governance. The Quality
Management Dept. (Sect.) is also responsible for leading quality control to minimize the occurrence of complaints and nonconforming products at each factory.
The Products Evaluation Dept. of the Responsible Care Division is a department that specializes in product liability (PL), and conducts product compliance reviews with domestic andinternational laws and regulations, label and safety data sheet (SDS) reviews, voluntary management of chemical substances, and customer services.
In the event of PL-related deliberations, accidents or complaints, we will convene an investigative meeting and a countermeasure meeting to deal with them accordingly.
In FY2022, there were no PL-related deliberations, accidents, or complaints.
Organization

60

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Provision of safe and secure products
By communicating with customers, we understand their needs in terms of performance, quality, and the environment, introduce products and develop new products that meet thoseneeds, and provide appropriate technical and safety information concerning our products.
For newly marketed products, we have employed a system to start sales only after we understand the intended use of the customers and confirm the compliance of the products with thecustomers’ requirements, including green procurement and use of non-conflict minerals. We also set a rule to eliminate chemical substances that do not comply with the customers’
needs early in the product design stage.

Positive quality control
We produce and market approximately 3,000 types of performance/chemical products.
Our domestic and overseas factories have acquired ISO 9001 certification and built quality control systems in synergy with the quality control system of our company.
In case quality issues occur, we will immediately investigate the cause, draft recurrence prevention measures, promptly respond to customers, and share the information concerning theissue among group factories to horizontally develop countermeasures.

Export control : Export Administration Committee, Export stop system
The export of chemical products may be restricted due to the Export Trade Control Order in Japan, laws/regulations of destination countries, or international treaties. In order to observe
those rules, we have incorporated an export stop system in our order system.
When making entry of an order, the system rejects products not registered in our export control database. Products Evaluation Department closely examines and inputs information into
the database serving as the foundation of this system, such as product chemical compositions and their status in other countries and any restrictions imposed by any laws or regulations.
The Export Administration Committee discusses and examines our group’s compliance to laws and regulations in concerned countries and then implements changes as necessary.

Product safety design and Provision of product safety information
At the product design stage, we design compositions that exclude prohibited substances stipulated by our chemical substance management regulations, as well as prohibited andrestricted substances/substances to be reduced that are stipulated by our customers’ green procurement standards. After confirming that the designed composition complies withdomestic and international laws and regulations and undergoing a safety data sheet (SDS) and label review, we commercialize the relevant products.

Click here

for the design management

When we introduce our product sample, we also submit the SDS at the same time so that the customer can check the technical features and the safe handling methods.
Following the revision of laws related to chemical substances, including the Chemical Substance Control Law, Industrial Safety and Health Act, PRTR Law, and Poisonous andDeleterious Substances Control Act, we revised the SDS and product label accordingly.
To each driver of trucks and tanker trucks that transport our products, we issue a yellow card with first-aid methods and emergency contact information so that they can appropriately
respond in case of an accident during transportation.

61

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Communication with customers
We are striving to disseminate our new product and technical information through press releases, press conferences, and other means, as well as direct communications with customers
at exhibitions and wherever possible. On the product search page of our website, it is possible to search not only by function, application, and composition, but also by social needs.

Click here

for Products Information

We launched our website to introduce resin/functional chemicals and explain our product/technical information. The website contains detailed information to deepen understanding of ourperformance chemicals, such as each product’s features and use applications, explanations of functions, and other basic knowledge.

Click here

for Product & Technology Site

GPS (Global Product Strategy) / JIPS (Japan Initiative of Product Stewardship)
We participate in GPS (in Japan, JIPS led by the Japan Chemical Industry Association), which is an international voluntary initiative for chemical product management promoted by theInternational Council of Chemical Associations (ICCA). Based on GPS principles, we prepare and publish safety summaries of chemical substances.
These are summary documents that compile the safety data for chemical products and risk assessment that takes into account the supply chain. We have created safety summaries forthe following chemical substances.

Substance name

CAS No.

2-(Dimethylamino)ethyl methacrylate

2867-47-2

Poly(oxyethylene)nonylphenyl ether
Ethylene oxide 3 〜10 mole9016-45-9

Poly(oxyethylene)nonylphenyl ether
Ethylene oxide 11〜15 mole9016-45-9

Poly(oxyethylene)nonylphenyl ether
Ethylene oxide more than 16 mole9016-45-9

Poly(oxyethylene)alkylether (alkyl group:C12〜C15)
Ethylene oxide 2 〜 4 mole

9002-92-0

Poly(oxyethylene)alkylether (alkyl group:C12〜C15)
Ethylene oxide 5 〜10 mole

9002-92-0

Poly(oxyethylene)alkylether (alkyl group:C12〜C15)
Ethylene oxide 11〜19 mole

9002-92-0

Poly(oxyethylene)alkylether (alkyl group:C12〜C15)
Ethylene oxide more than 20 mole

9002-92-0

62

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sustainable Procurement

At Sanyo Chemical Industries, Ltd., we believe that it is important to improve CSR in procurement while collaborating and cooperating with our business partners throughout the supply
chain. Sanyo Chemical Industries, Ltd. signed the UN Global Compact (UNGC), a global framework for achieving the Sustainable Development Goals, on March 5, 2021, to further
promote sustainability as a group. In addition, we used this opportunity to review our previously established “purchasing policy” and to formulate a “sustainable purchasing policy” inJanuary 2022. Under this policy, we aim to promote procurement activities that contribute toward realizing a sustainable society.

Sustainable Purchasing Policy
1. We conduct procurement activities based on social common sense and corporate ethics in addition to ensuring compliance, and strive to cooperate with our business
partners, and build relationships based on trust.
2. We provide fair business opportunities to both domestic and overseas companies and conduct procurement activities from a global perspective.
3. We consider various conditions such as the quality, price, and stable supply of materials and raw materials in procurement activities. Moreover, we make efforts to set
appropriate prices and maintain and improve quality in cooperation with our business partners. Simultaneously, we promote green procurement in terms ofenvironmental conservation and chemical substance control.
4. We aim to create a sustainable society throughout the supply chain in conjunction with our business partners to fulfill the corporate social responsibility, including
considerations related to the global environment and protection of human rights and the working environment.

Sustainable Procurement Guideline
As a tool for collaborating with our business partners to create a sustainable society, we have summarized in our Sustainable Procurement Guidelines not only what we should do, butalso what we would like our business partners to do. The guidelines present specific actions based on the Ten Principles of the United Nations Global Compact from seven perspectives:
sound corporate management, fair corporate activities, the environment, human rights, labor, quality & safety, and coexistence with local communities. We post our purchasing policy andthese guidelines on our website and attach them to CSR questionnaires to our business partners to ensure that they are widely known and understood.

At the start of a business transaction
We ask our business partners to submit the following documents before starting a transaction. Based on the contents of these documents, we understand, evaluate, and share the status
of CSR activities, sustainable procurement, and green procurement promotion with our business partners, aiming to improve the level of sustainable procurement together.
Documents necessary for raw material adoption(1) Raw Material Supply Specifications Excel(2) Safety Data Sheet(3) Certification of Specific Chemical Substances (Non-use warranty of RoHS substances）Excel(4) Investigation Report of Environmental Management and Chemical Substance Management Excel(5) CSR Questionnaire Excel

CSR questionnaire
The CSR questionnaire uses the Global Compact Network Japan’s Self-Assessment Questionnaire (SAQ) to quantify the extent to which our business partners meet the requirements of
the United Nations Global Compact. For items that do not meet the requirements, a message will be sent to them to urge improvement.
In FY2022, we asked suppliers of our key raw materials to complete a questionnaire and received responses from all of them. As a result, it was found that many of our key raw material
suppliers were large global companies and generally obtained high evaluation points. Although there were some responses that scored below 80 points when viewed by item, it was
confirmed that although the relevant suppliers had a CSR policy and management system in place, they just lacked a system for checking and correcting the situation.

63

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
SAQ response results for our key raw material suppliers

Evaluation

Average point out of 100

Corporate governance98

Human rights

98

Labor

98

Environment

98

Fair corporate activities

100

Quality & Safety

100

Information security

98

Supply chains

97

Community

98

Note: The results of all 114 questions (out of 5 points) were averaged for each evaluation item and displayed on a 100-point scale.

In FY2023, we will conduct a questionnaire survey mainly of suppliers of oils and fats who may pose risks in terms of labor and human rights, and evaluate them to improve the level ofsustainable procurement.

RSPO certification
For palm oil, problems have been pointed out in terms of ecosystem collapse, labor, and human rights violations during cultivation and production. To resolve these problems, theRoundtable on Sustainable Palm Oil (RSPO) has established a palm oil certification system. From a sustainability perspective, it has become necessary to
procure and use palm oil (derivatives) that is properly managed in the supply chain. Accordingly, we joined the RSPO in 2013 and obtained an RSPO certificationfor our Head Office, the Tokyo branch office, and domestic factories (Nagoya, Kashima, Kyoto, and Kinuura Factories) under the mass balance method* inJanuary 2023. As part of our supply chain management, the Group will also require its suppliers to procure and use properly managed palm oil, expand the use ofcertified palm oil, and promote the establishment of a system for sustainable procurement and supply of raw materials.
* Mass balance method: RSPO has three certification models (Identity Preserved, Segregation, and Mass Balance) and one credit model (Book & Claim).
The mass balance method is a certification model in which certified oil is mixed with non-certified oil in the processing and distribution process. Although the physical product includes non-certified oil, thequantity of certified palm oil supplied from certified plantations and oil mills is guaranteed.

ISCC certification
The ISCC (International Sustainability and Carbon Certification) PLUS certification ensures that biomass-derived raw materials are properly managed in the sustainable, traceable,
deforestation-free supply chain. Regarding polyethylene glycol (PEG) derived from biomass, we obtained ISCC PLUS certification under the mass balance method for our Head Office,
the Tokyo branch office, and a domestic factory (Nagoya Factory) in May 2023. PEG is a polymer obtained by adding ethylene oxide to ethylene glycol and water and used in a wide
range of industrial applications such as cosmetics, toiletries, and resins, as well as pharmaceuticals. We will continue to contribute to the realization of carbon neutrality through the useof biomass resources.

Conflict minerals
Minerals (conflict minerals: particularly gold, tantalum, tungsten, and tin) mined in the Democratic Republic of the Congo and surrounding countries in Africa, which are conflict zones,
have been a source of funds for the activities of local armed groups. The armed groups are said to be forcing local residents to work in mines in inhumane conditions.
Companies are required to carefully examine their supply chains, and avoid and mitigate risks in order not to contribute to human rights violations and conflicts by armed groups throughtheir corporate activities.
Our Sustainable Procurement Guidelines state that “we ensure supply chain transparency and are not involved in conflict mineral procurement, crime, etc.” We investigate whether the
raw materials that we procure contain conflict minerals and confirm their country of origin, and require our suppliers to do the same. Based on these investigation results, we respond to
customer requests regarding conflict minerals.

Implementation of a BCP for raw materials
To ensure business continuity in the event of a disaster (natural disaster, large fire, terrorist attack, etc.), we work with our business partners to implement a BCP(Business ContinuityPlan) for raw materials. We work on purchasing raw materials from multiple sources, consolidating similar raw materials, and securing multiple bases on the supplier side.

64

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Human Resources

Human Resources (HR)Development

Diversity, Equity &Inclusion (DEI)

Work Style Reform

Health andProductivity Management

Based on our company mission, “Establish a better society through our corporate activities,” we have set our Vision as “Grow into a global, unique, and highly profitable company where
every employee feels pride and satisfaction in his/her work.” We have also set out the following three values as our important values: (1) Inspire WakuWaku feeling from all stakeholders,(2) Co-create environmental, social and economic value with the stakeholders, and (3) Facilitate every employee’s own value creation.
To realize our Vision, we will continue to take on challenges with a sense of speed while combining the power of the Group and all of our stakeholders, in order to create innovations
beyond the boundaries of chemistry based on new ideas of diverse individuals. We will also co-create environmental, social, and economic value with our stakeholders to increase ourcorporate value.
To promote changes toward the Vision, we believe that it is important to create a company in which each and every employee can be excited (“WakuWaku”) based on the idea that“Every department is a profit center” (each and every diverse employee from all walks of life plays a leading role).
Based on this belief, we have established our HR Philosophy as “Respect diversity and collaboration.” Our goal is to create new value through the synergistic effects of individual
connections based on mutual recognition of each other’s individuality. Under this philosophy, we will foster job satisfaction and pride in each employee based on our HR policy, “Create anenvironment in which individual abilities can be maximized.” Specifically, we will develop a grade system that makes better use of capabilities, a compensation system based oncompetence and roles, and a fair and transparent evaluation system. We will also carry out human resource development while being conscious of the learning that individuals require,
such as strengthening management skills, deepening specialization, and reskilling.

HR Philosophy

Res pec t div ers ity and c ollaboration

HR Policy

Create an env ironment in whic h indiv idual abilities c an be max imiz ed

Image of the connection between human resources philosophy, human capital, and management policies

In accordance with our motto, “Every employee in various situations plays a leading role,” which includes overseas and production sites employees as well as at our head office, we aredetermined to spotlight everyone so that every employee can shine and experience a sense of accomplishment. We have the concept that “Every department is a profit center” which
expresses the essence of this idea. We believe that being a company where every employee can be excited (WakuWaku) is key to transformation toward our vision.
Sanyo Chemical group will actively put effort into the resolution of diverse issues for a better sustainable society. Therefore, while placing importance on each and every employee’s job
satisfaction, including global staff (locally hired employees of overseas affiliates), we will take on the challenge along with all stakeholders toward “An exciting (WakuWaku) future.”65

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

PolicyThe Group has long been committed to “people-oriented management,” and has established systems that allow everyone to take on challenges on their own initiative, aiming to be acompany in which each and every employee can grow together with the company and feel job satisfaction and happiness. We position human resources as the driving force that creates
innovation toward the realization of our Vision. Aiming to spotlight everyone and to promote changes in an exciting way (“WakuWaku”), we set our HR Development Policy to “haveeveryone play an active role” and “develop an environment in which leaders (successors) grow naturally.” Under this policy, we will strengthen our human resource base to support oursustainable growth.

Management System

Personnel affairs/education system for fostering employee’s challenge spirit
We have a personnel affairs/education system for employees to develop their capabilities and nurture their desire to take on new challenges.
We also have the following systems; self-development support centered on ON-JT (On the Job Training), OFF-JT (Off the Job Training), online English conversation, upskilling/careerdevelopment education including Dojo, a place for dialogue between top management and employees, global human resource development education as well as our Unique Challenge
System.

66

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Targeta. Everyone can play an active role
Believing that a “strong organization (One Team)” composed of “strong individuality” (each playing a leading role) will create new value, we will proceed with each measure.
Strong individuality
TargetMeasureDetails
Item

Current
situation

Targetvalue /
VisionAchievement
time (FY)

There is adis tinc tion
betweenEnsuring that everyone canplay an active role

To prov ide an env ironment in whic h all employ ees c anplay an ac tiv e role regardles s of their c ours e, we unify
the grade s y s tem from the c urrent generalis t ands pec ialis t pos itions to an as s oc iate pos ition.

Es tablis hmentof a c ours es y s tem

generalis tands pec ialis t
pos itions(as ofMarc h2023).

Unific ationof c ours es

2023

A s tatefull ofhuman
res ourc es
with as piritc hallenge
and as trong
des ire to
grow

2027

・We improv e ex is ting s y s tems , s uc h as the “Internal
multiple role s y s tem” that allows employ ees to tak e
on c hallenges in work that interes ts them, “Awards
from General Managers to enc ourage c hallenges ”
that enc ourage employ ees to propos e their ideas to
do to ex ec utiv es , the “Challenge c ontrac t s y s tem,”“Commendations from the pres ident,” “J ET,” and“Training retreats ,” to mak e them more us er-friendly
for ac tiv e utiliz ation while inc orporating opinions fromon-s ite employ ees .
・We es tablis h a new c areer dev elopment training
program in whic h employ ees unders tand theirs trengths and weak nes s es , mak e efforts to inc reas etheir v alue, env is ion a c areer that c ontinues to grow,Supporting proactive
challenges and independent
learning

and c ons ider how to implement their c areer goals toc ontribute to the organiz ation. We als o c onduc t a
training program in whic h the s uperiors of thes e

Creation of as pirit ofc hallenge

employ ees who hav e env is ioned their future c areers

There is a
mix ofproac tiv eandpas s iv e
people.

c ons ider how to s upport them.
・By ac tiv ely implementing rotations both within andbetween div is ions (func tions ), we prov ide
opportunities for employ ees to ac quire div ers e andwide-ranging k nowledge and ex perienc e. We als oc onduc t aptitude tes ts for all employ ees and c ompile
pers onnel data s o that we c an implement rotations
bas ed on the c harac teris tic s of eac h employ ee (theright pers on for the right job).
・We c ontinue to c onduc t training programs , s uc h as
the “Study abroad s y s tem,” “Overs eas training,” and“Language training,” to dev elop human res ourc es
who c an play an ac tiv e role on the global s tage.
Strong organization
TargetMeasureDetails
Item

Organizational evaluation
system

We introduc e an organiz ation ev aluation s y s tem withthe aim of max imiz ing organiz ational performanc e. We
c reate a s tate in whic h eac h organiz ation s ets anorganiz ational goal toward its v is ion (Wak uwak u
v is ion), with ev ery one in the organiz ation tak ing ac tion
toward the organiz ational goal.

67

Ac hiev ement
rate oforganiz ationalgoals

Current
situation－

Targetvalue /
Vision80% ormore

Achievement
time (FY)2025

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

b. Development of an environment in which leaders (successors) grow naturally
We believe that the ideal environment is one in which candidates for future management or key positions in major businesses and functions are growing naturally. To achieve such anenvironment, we will first work on measures to develop leaders systematically. Then, we will develop an environment in which more and more employees will see the careers of those
who grow into leaders and want to become leaders themselves, and realize their goal.

TargetMeasureDetails

We regularly hold human res ourc e dev elopment
meetings to s elec t c andidates for the nex t leaders anddis c us s a leaders hip dev elopment plan, thereby
identify ing mis s ing human res ourc e requirements . We
prov ide training for s elec ted leaders hip c andidates toenable them to s ee the c ompany from a manager ’s
pers pec tiv e and ac quire the s k ills to formulates trategies . We implement rotations to fill mis s ing humanres ourc e requirements . We prov ide c areer training to
dis c ov er y oung employ ees who env is ion their c areer
paths and want to tak e on the c hallenge of bec oming aleader.

Systematic leader
development

Item

Current
situation

Target value/ Vision

Number ofleaders hipc andidates

A s tate inwhic hleaders hipc andidates
are not
identified

A s tate inwhic hthere areenoughleaders hipc andidates
for eac hpos ition

Achievement
time (FY)2027

Work environment improvement
Aiming to become a company in which all employees can work in good health and with peace of mind while valuing their individuality, we will promote efforts to reform work styles,
diversify human resources, and create a work environment in which all human rights and diverse values are respected and accepted and in which all employees are encouraged toperform active roles.

Education/training system
We have developed an education system based on our “Skill and Training Map” which summarizes the skills and knowledge of each role. We introduced Online language (English,
Chinese) training programs and e-learning system, to help employees enlighten themselves and develop their individual capabilities.

Education system in accordance with job rank
(1) Upskilling/career development
Role(2) Global human resource development
Rank based education

Selective training

Managerial staff

Promotion training – near futureforum

Ex ec utiv e c andidate
training

Chief

Promotion training – future forum

Offs hore training

Deputy chief or lower
rank

Promotion training – long-term
forum

Trainer training

Educational Programs
New tec hnic als c hool,
Law c ours e,
Training Program,Open s eminar,
J ET,
Online Englis hles s ons ,Online Chines e
les s ons

Study abroad,Ov ers eas training,
Language training,
Ex patriate s taff dev elopment
program,
Educ ation of ov ers eas group
educ ations(1) Upskilling/career development

Law course

Ex planation of details of important laws , inc luding Chemic al Subs tanc e Control Law,
Lec tures on regulations on ins ider trading through e-learning,
Lec ture c las s es on Ex port Trading Control Order (for s ales pers onnel), etc .
・Res earc h bas ic s c ours e: bas ic c hemis try nec es s ary for produc t des ign; 56 trainees c ompleted the c ours e in FY2022

Training Program forresearch section

・Prepared 12 k inds of training us ing outs ide v endors , total of 56 people took lec tures s uc h as MOT s c hools , c oaching
training, c ritic al think ing training, and des ign think ing training in FY2022.
・e-learning (GLOBIS unlimited learning, Udemy ) : total of 230 pers ons took lec tures

Forum

Informal s eminar offers an opportunity for dialogue between managerial s taff and employ ees ; dialogues took place 12 times
in FY2022

JET（Job Exchange Training）

Training in whic h two employ ees from different departments s witc h work plac es for about one month to ex perience different
work . Its purpos e is div ers ific ation of the c apabilities of indiv iduals .

68

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
(2) Global human resource development
Study abroad

Overseas training

Expatriate staff development
program

For the purpos e of ac quis ition of MOT (Management of Tec hnology ) and MBA (Mas ter of Bus ines s Adminis tration) degrees
at ov ers eas univ ers ities ; one pers on s tudied abroad in FY2022.
Language learning and ex perienc e in the bus ines s field at ov ers eas affiliates ** No implement at ion of ov ers eas t anning program in FY 2022 due t o COV I D-19

Educ ation targeted for employ ees pos ted ov ers eas ; one trainee in FY2022

Awards system
Awards from president

The managerial s taff giv es awards to people for their performanc e at v arious points in time. Voluntary c hallenges are highly
rated. 33 c as es in FY2022.

Awards from generalmanagers to encouragechallenges

Award giv en when the general manager or other ex ec utiv e rec ogniz es through operations that ac tions , s uc h as voluntaryc hallenges and innov ations , hav e begun to thriv e (e.g. s tart of implementation) : 522 c as es in FY2022

INVENTOR OF THE YEAR

As ide from s pec ial awards , the bes t patent among inv ention patents in the c orres ponding y ear is awarded.

HR Development lecture sessions hosted by the labor union
With a union shop system, in which all employees except managers join the labor union, we work to build relationships that emphasize dialogue and cooperation between laborand management. As part of the activities of the labor union, it holds HR Development lecture sessions, inviting experts and celebrities, with the aim of developing humanresources, who are the assets of the company. The sessions are attended by not only union members but also managers and executives. In FY2022, the following lecture
sessions were held in an online live distribution format (22nd session) to prevent the spread of COVID-19 and in a hybrid format (23rd session) that combines an online
distribution with on-site participation. Both sessions were attended by over 100 online participants, with approximately 20 on-site participants in the 23rd session.
・22nd session: “Organizational design for cross-cultural communication—Leading to the growth of employees and thecompany”
Lecturer: Mr. Jeff Berglund [Professor at Kyoto University of Foreign Studies, Kyoto International Tourism Ambassador]

Mr. Jeff Berglund[Professor at Kyoto University of Foreign Studies, Kyoto
International Tourism Ambassador]

・23rd session: “Mental coaching that changed Japan’s national rugby team—Leadership that revitalizes the organization”
Lecturer: Ms. Kaori Araki [Visiting Professor at Juntendo University, chief consultant at CORAZON Co., Ltd.]

Ms. Kaori Araki[Visiting Professor at Juntendo University, chief
consultant at CORAZON Co., Ltd.]69

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Human Resources

Human Resources (HR)Development

Diversity, Equity & Inclusion (DEI)

Work Style Reform

Health andProductivity Management

Aiming to be a company in which all employees can work comfortably with peace of mind while valuing their individuality, the Sanyo Chemical Group promotes “DEI (Diversity, equity &inclusion)” to create a work environment in which all human rights and diverse values are respected and accepted, and in which all employees are encouraged to perform proactive roles.
In the promotion of DEI, the perspective of equity is particularly important, as it leads to the valuing of individuality. We will contribute to the creation of a sustainable society by generating
added value through a combination of diverse needs and the ideas and technologies of each of our employees.

What is Sanyo Chemical’s DEI?

Diversity Diversity: Respecting differences
Our company is full of diversity in terms of age, gender, values, disabilities, career, educational background, family environment, nationality, personal background, and otherfactors. We respect and acknowledge each other’s differences to build a work environment in which everyone can work with a peace of mind.

Equity Equity: Ensuring fair treatment[Equality] = Giving the same thing to everyone, without considering individual differences[Equity] = Taking individual differences into consideration and giving each person what is appropriate to achieve their goals
From the perspective of fairness, which focuses on the differences between each person, rather than equality, we will develop systems and initiatives tailored to the working
conditions and environment of each employee.

Inclusion Inclusion: Increasing a sense of belonging to an organization
This refers to recognizing and accepting each other’s individuality and working together as one. A diverse and equitable organization is not necessarily one in which employees
feel a greater sense of belonging. Recognizing that unconscious bias and assumptions may exist, we strive to improve psychological safety within the company to create anenvironment in which diverse individuals and groups are respected, supported, and valued.

70

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Targets and Results
Measures

Contents and items

Overall DEI promotion

Confirmation of v arious
initiativ es

Empowerment of
women(1) Female leader ratio(2) Female manager ratio(3) Female direc tor ratio(4) Female direc tor ratio

Target value (deadline)

D&I AWARD 2022 c ertified (the highes t rank )(1) 15% or more (FYE2023)(2) 6% or more (FYE2023)
Not e: (1) and (2) are t arget s bas ed on t he 3rd A c t ion P lan[ P eriod: A pril 2021 - Marc h 2024] .

(3) More than 30% (FYE2030)(4) 100% (FYE2025)

Current status

Evaluation

Certified in
FY2022

A(1) 15.2% *1(2) 4.9% *1(3) 22.2% *1(4) 98.2%

LGBTQ

Rais e awarenes s internallyand ex ternally.

PRIDE Index 2022, Gold c ertific ation

Certified in 2022
(four c ons ec utiv ey ears )People with disabilities(1) Support for c ontinued
employ ment
(2) Employ ment rate(1) Ins titutional s truc ture (FYE2023)(2) 2.5% (FYE2024)(1) Proc eed(2) 2.06% *2

Foreign nationals(non-Japanese)

Number of foreign
employ ees hires

2 or more hired eac h y ear

Rating guideline A: Target achieved B: Steady progress

C: Target not achieved despite improvement (or progress)

(1) A
(2) C
(3) C
(4) B

A

(1) B
(2) D

2 peopleA

D: Target substantially missed or efforts insufficient*1 As of March 31, 2023
*2 As of June 1, 2023

DEI promotion system
Since its founding, the Sanyo Chemical Group has promoted “people-oriented management” based on its company mission, “Establish a better society through our corporate activities,”with the aim of becoming a global, unique, and excellent corporate group. In addition to improving our economic and social factors, we value the job satisfaction, pride, and happiness of
our employees. Therefore, we have worked from an early stage to create an environment where it is easy for women to work and have introduced various systems aimed at supporting abalance between work and family life under the Act on Advancement of Measures to Support Raising Next-Generation Children. In FY2014, we established a women’s empowerment
promotion section and consultation service. Based on the Act on the Promotion of Women’s Active Engagement in Professional Life, we have shifted our focus from supporting thecontinued employment of women to promoting the active participation of women, accelerating various initiatives. In FY2019, we established the Diversity Promotion Department within the
Personnel Division to further accelerate support for not only women but also minorities in the company, including LGBTQ people, with the aim of strengthening our DEI promotion system.

The Group has set the promotion of DEI as a material issue in its management policy “WakuWaku Explosion 2030” and the New Medium-Term Management Plan 2025. In FY2021, we
decided to designate December of each year as “Diversity Month” to conjunction with Human Rights Week (from December 4 to 10 every year). DEI-related lecture sessions and events
are held during Diversity Month. Thus, we are working to further change the mindset of all executives and employees.
Examples of activities during Diversity Month
Seminar to understand DEI / IKUBOSU lecture / Salon for LGBTQ people / Diversity menu provided at a company cafeteria

71

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Promotion of women’s empowerment
Declaration on Action
In March 2017, we endorsed the Declaration of Action of the "Association of Male Leaders to Accelerate the Advancement of ‘Shining’ Women", which is supported by the Cabinet

Office. With the aim of creating an environment in which diverse human resources can play an active role, we implement measures that will lead to the empowerment of women andpromote the active participation of women.

Action Plan
We have formulated the 3rd Phase Action Plan (April 2021 to March 2024) based on the Act on the Promotion of Women’s Active Engagement in Professional Life and have submitted it
to the Kyoto Labor Bureau. We have set the goal of increasing the female leader ratio to 15% or more and the female manager ratio to 6% or more by FYE2023 to lead to a steadyincrease in the number of women in management positions. While continuing our existing activities, we are working on the creation of a new Diversity Month and on systematic rotations
for the development of female employees. In FY2021, we conducted a questionnaire survey among employees on the promotion of women’s empowerment, which is conducted every
three years, to confirm changes in employee awareness and to use the survey results to plan future measures.
Third phase action plan based on the Act on the Promotion of Women’s Active Engagement in Professional Life (in Japanese only).pdf

Number of childcare leave used (including employees dispatched to Sanyo Chemical Group companies)
FY

2018

2019

2020

2021

2022

Male (persons)

27

37

40

47

55

Female (persons)

14

13

17

11

17

Employees return ratefrom childcare leave (%)

100

100

100

100

100

(As of March 31st of each year)

Reduced working hours for childcare (including employees dispatched to Sanyo Chemical Group companies)
FY

2018

2019

2020

2021

2022

Male (persons)

1

0

0

0

0

Female (persons)

50

16

12

4

6
(As of March 31st of each year)

72

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Reform of employee awareness and corporate culture
We hold study sessions at executive training camp study sessions, training sessions for managers, level-specific training sessions, and exchange meetings for people inside and outside
the company. We also allow the use of a maiden name within the company, encourage male employees to take childcare leave, and participate in the IkuBOSS declaration and IkuBOSS
Corporate Alliance membership.

Executive training camp study sessions

IkuBOSS Corporate Alliance Membership

Promotion of childcare leave for male employees
We encourage male employees to take childcare leave with the aim of realizing the wishesof male employees who want to actively raise children, and promoting women’s desire towork by allowing husbands to share with their wives the burden of childcare andhousework, which tends to fall on the female partner. In FY2022, 55 male employees tookchildcare leave.
Note: In line with the revision of the Childcare and Family Care Leave Act in October 2022, a total of
28 days of salary is paid to the relevant employee after the start of childcare leave, including
postpartum paternity leave, regardless of gender.

Development of female employees《External training》
Participation in the 21st Century Seminar for Women’s Empowerment
Through participation in an external seminar, we aim to increase the motivation and skills of female employees andbuild an external network with women working at different companies.

The 21st Century School of Empowerment for Women《In-house training》
Holding of the Women’s Network Seminars
We hold an in-house training session to increase the motivation and skills of female employees and to build a network
among female employees that transcends departments, sections, and regions. We aim that this training session will
help participants to grow themselves and develop their future careers and will provide them with the opportunity to think
independently about creating a comfortable and rewarding workplace.

Women's Network Seminar73

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Holding of an outside Director’s salon
We regularly provide opportunities for the company’s first female outside Director, Aya Shirai, to interact with theGroup’s managers and female employees so that they can exchange views on promoting women’s empowerment andtheir careers.

Outside Directors Salon

Holding of a seminar to support work and childcare balance for those returning to work after childcare leave
We hold a seminar to help employees who return to work after childcare leave to work actively despite time
constraints. while balancing work and childcare, and build satisfying careers, and develop an internal network among
employees working in the same environment. To balance work and childcare, it is essential to have understanding andsupport from the superiors of the relevant employees and those around them. Accordingly, we encourage their partners
to participate in the seminar regardless of whether they belong to the company and require the participation of theirsuperiors.

Seminar to support work and childcare balance for those returning to work
after childcare leave

In addition, we hold a subordinate development seminar for managers, a training session for female employees, and an exchange meeting with female employees from other companies.
We also provide opportunities for learning during childcare leave, conduct interviews after childcare leave, and expand job categories (systematic rotations) for those who return to work.

Major support systems for women’s empowerment
Systems / Measures

Details

Subsidy system for babysitter expenses
and childcare expenses for sick children

To s upport early return to work from c hildc are leav e and early trans ition from s hort work ing hours for childcare
to full-time work , we hav e introduc ed a s ubs idy s y s tem for baby s itting ex pens es and c hildc are expenses for
s ic k c hildren.

Creation of a handbook to support balancing
work and childcare.

We hav e c reated a handbook for all employ ees that s ummariz es v arious s y s tems , mainly in-hous e systems,
regarding work s ty les during pregnanc y, and after c hildbirth and return to work . We hav e pos ted about it on theintranet.

Review of the personnel evaluation system

To ens ure fair ev aluation, we abolis h ev aluation res tric tions for employ ees who tak e a leav e of absence due toc hildc are and nurs ing c are when ev aluating employ ees regarding s alary inc reas es , promotions , bonuses, andother rewards .

Encouragement of male employees to takechildcare leave

To c reate a work place env ironment where it is eas ier for women to work , we enc ourage male employees totak e c hildc are leav e (both male and female employ ees are paid for a total of 28 day s from the s tart of childcareleav e).

Major systems to support continued employment
Systems / Measures

Details

Childcare leave

Av ailable until the c hild turns one y ear old(Howev er, if there are reas ons s uc h as not being able to enroll in a nurs ery s c hool or other fac ility, the leave is
av ailable until the c hild’s third y ear of age.)

Reduced work hours for childcare

Av ailable until the end of the fis c al y ear in whic h the c hild is in the fourth grade of elementary s c hool

Short working hours

Pos s ible to s horten work ing hours by two hours per day

Staggered working hours

Pos s ible to s hift the s tart and finis h times by 30 minutes

Other support systems include exemption from overtime work, sick child leave, expansion of nursing care leave, and a re-employment request registration system.
We have also established various systems aimed at achieving an ideal work-life balance, such as an hourly paid holiday system and a super flextime system. The details are introducedin the “Work style reform”

section.

74

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Promotion of LGBTQ understanding
Since 2018, we have been working on initiatives related to LGBTQ sexual minorities. We are encouraging
understanding and inner promotion of LGBTQ issues by establishing internal and external consultation services,
revising internal rules and systems, conducting training and study sessions for executives and employees, providing
timely information via the intranet, etc., and participating in Rainbow Pride. We are also communicating to society in aneffort to create an environment that respects diverse values. Led by YouTuber Kazue-chan, an LGBTQ person who
has been a member of the Group since August 2020 and is engaged in raising awareness about LGBTQ issues, we
cooperate and participate in activities of external organizations as well as within the company.

Establishment of LGBTQ consultation services inside and outside the company
We have established LGBTQ consultation services both inside and outside the company to receive all kinds of consultations from employees.

Revision of internal rules
In July 2019, we reviewed our welfare system, and now establishing a system that allows employees to have a spouse regardless of whether the spouse is of the same sex or the
opposite sex. (For the application of the system, applications can be made by self-reporting without the use of official documents.)
We have also revised internal rules, including removing the gender field from job entry sheets and eliminating the division between male uniforms and female uniforms (employees canchoose the same work uniform or white coat irrespective of their gender).

Reform of employee awareness and corporate culture
Provision of training to understand LGBTQ issues
We hold training sessions for executives, personnel and general affairs staff, and all employees separately to deepen
correct understanding of LGBTQ issues. We also provide training for new employees.

Training to understand LGBTQ issues

Holding of an LGBTQ workshop, a movie viewing session, and a talk session
For employees to deepen their understanding of LGBTQ issues, we hold a mini seminar on basic knowledge of
LGBTQ, led by an external lecturer, and a movie viewing session to watch the LGBTQ-themed movies Kalanchoe no
Hana and Boku ga Seibetsu “Zero” ni Modorutoki at all our business sites in Japan. We also hold a talk session,
inviting an LGBTQ person as a guest, to exchange views on various topics related to LGBTQ issues.

LGBTQ workshop

Welcoming YouTuber Kazue-chan, an LGBTQ person
In August 2020, YouTuber Kazue-chan, an LGBTQ person who is engaged in raising awareness about LGBTQ issues, joined our company. Through Kazue-chan’s active participation ininternal and external events, we promote understanding of LGBTQ issues among our employees and further accelerate the reform of our corporate culture.

Kazue-chan (on the left) and the Company's chairperson, Dr. Ando

Kazue-chan's LGBTQ 100 Ally Video viewing session

75

Online Salon by Kazue-chan

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Become an ally!
The term “ally” refers to someone who expresses their understanding of LGBTQ people and actively supports them. Since declaring oneself as an ally sends a strong
message of support to LGBTQ people, we have created merchandise that can be worn by those who have declared themselves an ally, or be attached to their belongings, sothey can show that they are an ally.
Thus, we are working to raise awareness of efforts to express oneself as an ally. Currently, we define allies as comprehensive supporters of DEI promotion, not limited tosupporters of LGBTQ people.
Click here

for more information about the DEI Ally Network.

Goods for visualizing allies

Installation of all-gender restrooms
We have installed an all-gender restroom, which anyone can use regardless of gender, at the Kyoto Head Office. We
are gradually installing all-gender restrooms at other business sites of the Group. The all-gender restroom at the Kyoto
Head Office has three restroom stalls, one of which is a multifunctional toilet that can be accessed by a wheelchair.

All-gender restrooms

From the company to society
Participation in Rainbow Pride events
We participate in Rainbow Pride events in areas where our domestic business sites are located (Tokyo, Nagoya,
Kyoto, Kansai, and Kyushu) to introduce the Group’s LGBTQ-related initiatives by joining parades, displaying panels at
an exhibition booth, and distributing pamphlets.

Participation in Rainbow Pride events

Implementation of on-site lectures at external organizations and delivering lessons at high schools/universities
We offer on-site lessons on LGBTQ issues for students and faculty at high schools and universities to provide an
opportunity to exchange views among them. We also introduce the Group’s LGBTQ-related initiatives to companies
and other organizations.

On-site lessons

76

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Participation as a supporting member in the Kyoto City Citizen-wide “Kyoto where diverse sexualities are respected” Promotion Network
We aim to support all people, including sexual minorities such as LGBTQ people, throughout society and to create a diverse and inclusive society in which everyone can live comfortably
anywhere, including schools, workplaces, and local communities. To this end, we agree with the purpose of this network, comprising sexual minority groups, companies, governments,and other organizations. We actively participate in the network as a supporting member. To create an environment in which diverse values are respected, we strive to collaborate not onlyinternally but also externally.
Disseminating the thoughts of our Chairman Takao Ando (then President) on LGBTQ initiatives through web media and SNSs
With the aim of changing society, we widely disseminate our LGBTQ-related initiatives through interviews on web media and SNSs.
Increasing the number of "'ally' in the world is [LGBT-friendly] Sanyo Chemical Industries, Ltd.｜LGBTER

Web media "LGBTER" (Japanese only)

Kyoto Bar Association, the 51st Gathering to Consider the Constitution and Human Rights
From the Company, Change Society - Corporate Initiatives on LGBT Issues ｜The 51st Gathering to Consider theConstitution and Human Rights 6 - YouTube

Kyoto Bar Association YouTube Channel (Japanese only)

Kazue-chan YouTube channel【Company with approximately 2,000 employees】Why I hired a You Tuber - YouTube

Kazue-chan YouTube channel (Japanese only)

Promotion of employment and activities of persons with disabilities
As part of our corporate social responsibility and beyond, we strive to create a workplace where all employees can work together with their colleagues regardless of their disabilities. In
order to achieve this goal, we will promote various initiatives and focus on building a support system for continued employment.
Disabled employment rate (including employees dispatched to Sanyo Chemical Group companies)
FY

2018

2019

2020

2021

2022

Hired rate (%)

2.18

2.18

2.17

2.09

2.23

Number of persons employed (persons)

26

26

26

26

27

Note: As of June 1, 2023, the disabled employment rate is 2.06%.

(As of June 1 of each fiscal year)

77

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Training to promote understanding of persons with disabilities
To deepen understanding among executives and general affairs and personnel staff, we held a training session topromote understanding of the employment of employees with disabilities, inviting an external lecturer.

Training for executives to promote understanding of employment of
persons with disabilities

Improvement of in-house equipment
We have installed multi-functional toilets and have upgraded entrance doors to automatic doors.

Elevator

Office entrance and exit

Accessible toilet

Sanyo Chemical supports the independence of artists with disabilities as an official partner of Paralym Art, which is operated by the Shougaisha Jiritsu Suishin Kikou
Association.

Support for continued employment
Together with external experts, we promote the establishment of systems that enable employees with disabilities and those working together with them to expand their career with peaceof mind, including conducting regular interviews and establishing consultation services.

Promotion of senior empowerment
Through a re-employment system that allows employees to continue working after retirement, we expand opportunities for seniors to play an active role using their rich experience andknowledge, contributing to passing down their skills and developing their successors.

Re-employment of permanent retirees (including employees dispatched to Sanyo Chemical Group companies)
FY

2018

2019

2020

2021

2022

Number of persons(persons)

24

27

14

20

20

Re-employment rate
(%)

80

87

81

87

100

78

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Promotion of employment of global talent
Diverse human resources from various cultures are essential for global business development. We are working to create an environment in which employees whose first language is not
Japanese can play an active role (explanation of internal systems, policies, and personnel systems, translation of internal documents into English, support for visa procedures, etc.), andwill actively promote the employment of global talent in the future.
Number of employees with non-Japanese nationality (including transfers to Sanyo Chemical Group companies)
FY
Number of people(persons)

2018

2019

2020

2021

2022

18

17

12

13

12

Toward understanding of, and sympathy and action for DEI promotion
Implementation of a harassment prevention seminar
We conduct a seminar on power harassment, sexual harassment, SOGI harassment,* and basic knowledge of LGBTQ issues for all employees, inviting an external lecturer, so that theylearn key points for preventing harassment, including judgment criteria and case examples of harassment. We also provide consultation services regarding harassment both inside andoutside the company.
* SOGI harassment: Harassment related to sexual orientation and gender identity

Formation of an internal DEI Ally Network
With the aim of promoting DEI promotion activities led by employees, we have formed the DEI Ally Network, which collaborates with volunteers from each region and the Diversity
Promotion Department. At monthly regular meetings, we share objectives and information, exchange views, and consider DEI promotion activities tailored to each region to take specificaction.
Note: We define allies as comprehensive supporters in promoting DEI, not limited to supporters of LGBTQ people.

Establishment of a DEI portal site for employees
We have launched an internal DEI portal site, hoping that it will be the first step for each employee to take action. It is used to regularly disseminate and aggregate information on DEI
promotion in the Group. In addition, it has contents that help both employees and the Diversity Promotion Department to deepen their understanding of DEI.

Education/Training
FY2022 results (total number of participants: 1,400 in total)
Topic

Name of education/training

Subjects

DEI Training (Dev elopment and Management of Div ers e
Employ ees )New management appointees

Outside Experts

DEI Training & Haras s ment Prev ention Training

New employ ees

Outside Experts

Online mini-c ours e Unc ons c ious Bias

Direc tors and employ ees

Diversity
Promotion
Department

Improv ing Teamwork for Better Work Performanc e

Direc tors and employ ees

Prominenteminent people

Training programs open to ex ternal applic ants "Empowerment forthe 21s t Century Sc hool of Empowerment for Women

Female employ ees (mainly in leaders hip
pos itions )Outside Experts

Women's Network Seminar, a training program open to internal
applic ants

Female employ ees

Outside Experts

Outs ide Direc tors Salon

Female employ ees and managers

OutsideDirector of theCompany

DEI

Empowerment of
women

Instructors

79

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Topic

Empowerment of
women

LGBTQ

People withdisabilities

Name of education/training

Subjects

Instructors“Career planning and c hildc are" s upport s eminar for thos ereturning to work after maternity leav e

Female employ ees and their internaland ex ternal partners and s uperv is ors

Outside Experts

Osak a Univ ers ity -s ty le indus try -ac ademia c o-c reation educ ation
program

Female employ ees (who are s uitable forthe program c ontent)

Outside Experts

Lecture by Ik uBOSS (bos s es )Direc tors and employ ees

Outside Experts

Living Proac tiv ely in the 100-Year Life Era

Direc tors and employ ees

Advisor ofanotherc ompany

LGBTQ understanding training

Direc tors and employ ees

Diversity
Promotion
Department

Training for ex ec utiv es to promote unders tanding of employ mentof pers ons with dis abilities

Board members

Outside Experts

Training for employ ees to promote unders tanding of employ mentof pers ons with dis abilities

Dis tric t adminis tration and humanres ourc es s taff (open to all employ ees )Outside Experts

Online mini-lec ture Color Univ ers al Des ign

Direc tors and employ ees

Diversity
Promotion
Department(Reference) Major training and lectures held before FY2021
Item

Name of education/training

Subjects

Instructors

DEI

DEI Unders tanding Seminar

Direc tors and Employ ees(Attendanc e required)Ex ternal Experts

Empowerment ofwomen

IkuBOSS Key note Speec h for Ex ec utiv es

Direc tors

Ex ternal Experts

LGBTQ unders tanding training

Direc tors and Employ ees

Ex ternal Experts

Salon by LGBTQ people

Direc tors and Employ ees

Div ers ity Promotion
Department

LGBTQ work s hop, mov ie v iewing & talk s es s ion

Direc tors and Employ ees

Ex ternal Experts

Work-nurs ing c are and work -treatment balanc e s upport
seminar (bas ic )Direc tors and Employ ees

Ex ternal Experts

Work-nurs ing c are and work -treatment balanc e s upport
seminar (management)

Ex ec utiv es and managers mos tly

Ex ternal Experts

Lectures on home medic al c are and home c are

Direc tors and Employ ees

Ex ternal Experts

Haras s ment prev ention s eminar

Ex ec utiv es & Managers (Attendanc e
required)

Ex ternal Experts

LGBTQ

People withdisabilities

80

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

External evaluation
Awarded the highest “Gold” rating in the PRIDE Index for the fourth consecutive year
We received the highest “Gold” rating in the PRIDE Index 2022 for the fourth consecutive year. The PRIDE Index was established by the voluntaryorganization “work with Pride.” By awarding companies that are making outstanding efforts to support LGBTQ people and disseminating specific
LGBTQ-related measures to society, it aims to promote the creation of workplaces friendly to LGBTQ people and other sexual minorities and ensurethat such workplaces become established in society.

Certified as a “Best Workplace,” the highest rank in the D&I AWARD
In the D&I AWARD 2022, a certification system that evaluates companies that lead in diversity and inclusion, we were certified as a “Best Workplace,”
the highest rank in the award, for our active involvement in DEI initiatives. The D&I AWARD is organized by Job Rainbow Co., Ltd. In the award, fourlevels of certification are awarded according to the score given based on the evaluation of 100 items comprising five aspects: LGBTQ, the gender
gap, disability, multicultural coexistence, and childcare/nursing care.

Awarded the 3-star “L-boshi” (the highest grade)
In March 2022, we received the 3-star “L-boshi” certification (the highest grade) from the Kyoto Labor Bureau. “L-boshi” is a system whereby the
Minister of Health, Labour and Welfare certifies companies that have developed and submitted action plans based on the Act on the Promotion of
Women’s Active Engagement in Professional Life and have made excellent efforts to promote women’s empowerment. There are three levels ofcertification, and we received a 3-star certification because we met the criteria for all evaluation items.

Awarded Kurumin / Platinum Kurumin certification
In August 2017, we received Platinum Kurumin certification from the Kyoto Labor Bureau. Platinum Kurumin certification is awarded to companies thathave conducted higher-level initiatives among companies that have received Kurumin certification from the Ministry of Health, Labour and Welfare asa “company that supports parenting.” In 2007, we were the first company in Kyoto Prefecture to receive Kurumin certification.

81

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Human Resources

Human Resources (HR)Development

Diversity, Equity &Inclusion (DEI)

Work Style Reform

Health andProductivity Management

In order to become “a company in which every employee feels pride and satisfaction in his/her work” and to further advance reforms, the Group is promoting work style reforms from thethree perspectives: flexible work styles, business reforms, and the use of IT/AI. By offering a variety of work styles, we intend to create a work environment in which each employee canachieve results while feeling pride and job satisfaction.

Targets and results
We achieved certain results through the Work Style Reform Action Plan from April 2018 to March 2023.
Systems

Contents

Telecommuting system

Introduc ed a telec ommuting s y s tem in FY2019 for full-time employ ees (temporary and c ontrac t employ ees may apply at
the dis c retion of their department head), with no res tric tions on the reas on or number of day s of us e.

Annual Paid Vacation
Accumulation System (Expired
Paid Vacation Reserve System)

Eliminated the free us e of the Ex pired Paid Leav e Res erv e Sy s tem, whic h was made av ailable in FY 2018 for childcare
and family c are reas ons .
The number of day s ac c umulated was c hanged from 2 day s /y ear to 5 day s /y ear. In addition to full day s and half days,
employ ees c an now tak e leav e in one-hour inc rements .

Super Flextime System

Aiming to improv e produc tiv ity through effic ient work ex ec ution, a flex time s y s tem without c ore hours was introduced in
FY2015 to allow employ ees to v oluntarily and s y s tematic ally s et their own work ing hours to the ex tent that it does notinterfere with their work .

Hourly Paid Holiday System

In FY2016, we introduc ed an hourly paid leav e s y s tem to promote awarenes s of the importanc e of eac h hour of work andto c hange the way we think about time.

Flexible Leave System

Introduc ed a Flex ible Leav e Sy s tem in FY2019 that allows employ ees to tak e a leav e of abs enc e for pers onal reasons for
up to two y ears bas ed on their own needs , s uc h as for c areer dev elopment or to s pend meaningful priv ate time.

Nursing Care Support System

In FY2016, the nurs ing c are leav e period was inc reas ed from 93 day s (s tatutory ) to 365 day s , and the s hortened working
hours for nurs ing c are benefit was ex panded from 1 hour/day to 2 hours /day.

Internal Multiple Role System

Introduc ed an Internal Multiple Role Sy s tem in FY2021 that allows employ ees to ex pand their horiz ons by taking on
projec ts of interes t in parallel with their ex is ting work .

Systems to promote work-life balance
Based on the concept of “work hard, rest well,” we will promote a true work-life balance through flexible work styles. In addition to weekly no overtime days, we have systems such as
refreshment leave, memorial leave, hourly paid leave, and super flextime without core time. We are supporting more flexible work styles by easing restrictions on the reasons for using
super flextime and by revising the system so that it can be used by employees who work shorter hours. In addition, although the reasons for taking paid leave under the unused paid
leave reserve system had been limited to childcare and nursing care, the system has been made usable regardless of the reason. We also have a telecommuting system for all
employees and a flexible leave system that allows employees to take personal leave once during their employment for a maximum of two years, at their own discretion. In FY2022, four
employees used the flexible leave system for the purpose of obtaining qualifications, etc.
Manufacturing Innovation(Monozukuri Transformation)
Envisioning where we want to be in five and 10 years, we have worked in two teams: one that aims for automatization, mechanization, and the elimination of the 3Ds (Dangerous, Dirty
and Demanding) for the Monozukuri Transformation, and the other that aims for digitalization and the reform of work styles and education (work-style reform). We decided to conclude
these activities in March 2023, and after selecting themes to be continuously promoted, we will work on these themes at each factory. Going forward, we will change the name of thesereform activities to “Monozukuri Transformation,” and establish the Monozukuri Transformation Center within the Nagoya Factory in July 2023. Regarding digitalization and work-stylereforms, we will pursue process optimization, automatization, labor saving, etc.
Awareness reform and system building to create a workplace environment in which diverse human resources can play an active role・Measures to promote women’s empowerment [internal and external training program and exchange meeting, maiden name usage system, seminar to support work and childcarebalance for those returning to work after childcare leave (partner participation recommended)]・Systematic planning to develop human resources and their systematic allocation
・Review of the course/job group system (eliminating generalist and specialist positions to unify them into an associate position)
・Implementation of skill development interviews, etc.

82

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Internal Multiple Role System
Sanyo Chemical aims to create an "exciting company" that maximizes the potential of each and every employee to further enhance corporate value. In February 2022, as a measure toenhance employee job satisfaction and motivation, we began a trial operation of our Internal Multiple Role System that allows employees to expand their horizons by taking on projects ofinterest in parallel with their existing work.
Items at present (number of persons as of March 31, 2023)
・Development of odor sensors (7 persons)・CO2 absorber - development of separation membrane (3 persons)・Peptide Agriculture (8 persons)・Co-development of wearable body fluid sensor devices (4 persons)Open work environment
In order to create a state in which employees feel satisfaction and pride in doing their jobs safely and securely, and are willing to make a high level of contribution to the company while
voluntarily demonstrating their abilities, it is important to have a thorough dialogue with executives, the organization, and people in various capacities. We actively provide opportunities forcommunication.

Dialogue withexecutives

The “Dojo” is a s y s tem that allows exec utiv es and employ ees to hav e thorough dialogues . The ex ec utiv es ac t as dojo owners
and inv ite s tudents (employ ees ) to join a dialogue onc e a month for a period of s ix months to one y ear. The theme (message to
be c onv ey ed to the employ ees ) is left entirely up to the dojo owner. Twelv e dojos were open in FY2022, with s ix to eightpartic ipants (s tudents ) in eac h dojo. This s y s tem will c ontinue in the future. In addition, the “morning meeting for all employees,”in whic h ex ec utiv es giv e a lec ture to all employ ees onc e a month, will c ontinue to be held.

Training retreats

This is a s y s tem in whic h eac h div is ion or department s pend one or two day s dis c us s ing organiz ational dreams and issues, andthe c ompany s ubs idiz es the c os ts of the rec eption and lodging.

Salon

Managers and higher rank ing ex ec utiv es lead the s alon and talk with s ev eral employ ees .

Coffee meeting

This is a s y s tem to deepen mutual unders tanding through dialogue with the head of the organiz ation.

Internal social exchange
fees

Subs idies are prov ided for the holding of s oc ial gatherings within the c ompany.

Business innovation
・Introduction of a virtual desktop service that allows intranet access from outside the company
・Utilization of RPA (Robotic Process Automation)
・Utilization of a BI (Business Intelligence) system
・Introduction of an e-POST system that allows employees to make proposals directly to the president and executives through the intranet, etc.

External evaluation"First Best Practice Company" in Kyoto Prefecture
In 2016, our company was recognized by the Kyoto Labor Bureau as the first Best Practice Company in Kyoto Prefecture for its proactive efforts to "reform the way we work".
Certified with 3.5 stars in the 6th Nikkei Smart Work Management Survey
We were certified with 3.5 stars in the 6th Nikkei Smart Work Management Survey, which selects leading companies that take on thechallenge of productivity innovation through work-style reforms. This survey has been conducted by Nikkei Inc. since 2017, targeting
listed companies and leading unlisted companies across the country. It defines “smart work management” as efforts to maximizeorganizational performance through three elements: realization of diverse and flexible work styles, a system for creating new
businesses, and market development capability. Companies are evaluated on a five-star scale. We received an S+ rating forinnovation capability, an A+ rating for market development capability, and an A++ rating for human resource utilization.

83

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Human Resources

Human Resources (HR)Development

Diversity, Equity & Inclusion (DEI)

Work Style Reform

Health and Productivity
Management

The Sanyo Chemical Group aims to further improve corporate value by helping all employees be highly motivated and always try new things, creating an exciting (WakuWaku) company.
Therefore, it is essential that each and every employee be healthy. We think working while being in a mentally and physically healthy condition makes employees and their families happy,
which also leads to company development. Accordingly, we consider not only the individual’s role in personal healthcare, but also management’s role to participate actively in promoting
employees’ health. We established the Health Management Declaration in 2018, to actively promote health and productivity management. We are promoting health by striving to improve
employees’ health literacy through the activities of our Health and Productivity management, creating an environment/system where it is easy for everyone to work. Then, we will truly
become an exciting (WakuWaku) company.

Health Management Declaration
The physical and mental health of its employees is the company’s greatest asset. The Sanyo Chemical Group will actively support health promotion initiatives to realize amindful and fulfilling corporate life, respect the diversity of its employees, and enable each individual to achieve self-fulfillment by exercising their independence andcreativity, thereby contributing to society through the development of the company.
Akinori Higuchi
Representative Director, President and CEO

84

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Targets and results
In FY2020, we created a company-wide Health and Productivity Management Strategy Map using an external consultant. In the Health and Productivity Management Strategy Map, weestablished health investment measures for five health promotion initiatives, set evaluation indicators to verify their effectiveness, and determined target values for FY2025. At the end of
FY2021, the Health Promotion Team in each region created a Health and Productivity Management Strategy Map for each region respectively, based on the company-wide strategy map.
By planning and implementing not only company-wide measures but also measures unique to each region, we work to make health promotion more prevalent among all employees.

Health and Productivity Management Strategy Map Initiative85

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Action goals for the five initiatives(unit: %)Initiative

Item

FY 2019

FY 2020

FY 2021

FY 2022

FY 2025(Target value)

Exercise

To hav e anex erc is e routine
at leas t onc e a
week

29

31

50

50

70 or more

Sleep

To be well res ted
with s leep

54

57

66

63

80 or moreDiet

To hav e abalanc ed diet *1

-

-

76

75

90 or more

Alcohol

To hav e two or
more alc oholfree day s per
week

74

75

75

76

90 or more

Smoking

Not to s mok e(Smok ing rate
reduc tion)

77

77

82

83

90 or more

*1 Item added in 2021.

Checkups and guidance(unit: %)FY 2019

FY 2020

FY 2021

FY 2022

FY 2025(Target value)Rate of regular healthcheckups

100

100

100

100

100

Rate of medical checkups

43

68

89

96

100

Rate of specific healthguidance

14

80

94

94 or more

100

Lifestyle-related disease risk retention rate (health checkup results)(unit: %)FY 2019

FY 2020

FY 2021

FY 2022

FY 2025(Target value)

Obesity

24

26

25

25

20 or lessLiver function

30

34

31

34

30 or less

Fats

51

57

55

56

50 or less

Blood sugar

24

17

21

17

15 or less

Blood pressure

31

37

34

29

30 or less

Triple risk holders(fats, blood sugar,
blood pressure)

8

8

8

5

5 or less86

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Health Management Evaluation Indexes
To verify the effectiveness of health investment measures, we have started measuring presenteeism and work engagement in addition to absenteeism since FY2021.
We are actively developing health investment measures that will lead to improved productivity and job satisfaction, and ultimately resolve management issues.
Absenteeism*2

Personal injury/sickness
absence rate（%）

FY 2019

FY 2020

FY 2021

FY 2022

FY 2025(Target value)

1.5

1.5

1.8

1.9

1.0 or less

*2 A condition in which the employee cannot perform duties due to absence from work, leave of absence, or other reasons.
Measured by the number of employees on sick leave who are absent for more than one month.

Presenteeism*3

Labor productivity loss rate(%)

FY 2021

FY 2022

FY 2025(Target value)

37.5

36.6

30 or les s*3 A condition in which the employee is present at work but is not able to work sufficiently due to mental or physical health problems.
Measured by the WHO Health and Labor Performance Questionnaire.

Work engagement *4

Self-motivated behavior andpositive feelings toward
work (deviation value)

FY 2021

FY 2022

FY 2025(Target value)

49.7

50.1

51 or more

*4 A state of mind that is positive and full of accomplishment, vitality, enthusiasm, and immersion in one’s work.
Measured by a proprietary survey instrument using eight items that correlate well with the Utrecht Work Engagement Scale.

Progress in Health Promotion Activities
September 2018

Health Management Dec laration-

July 2020

Held the Firs t Health Promotion Conferenc e

Inauguration of health promotion s y s tem and s haring of healthis s ues

January 2021

Held the 2nd Health Promotion Conferenc e

Shared information on health promotion ac tiv ities interim
report and health s c oring report

June 2021

Held the 3rd Health Promotion Conferenc e

Report on Health Promotion Ac tiv ities FY2020 and
Confirmation of Initiativ es for FY2021
Shared the Group's health is s ues bas ed on analysis of healthc hec k up data ov er time

October 2021

Releas ed a c ompany -wide Health and Produc tiv ity
Management Strategy Map-

Held the 4th Health Promotion Conferenc e

Shared the Interim Report on Health Promotion Activities
2021 and the Group's Health and Produc tiv ity Management
Strategy Map

Health Management Work s hop Held

Repres entativ es of eac h region health promotion teampartic ipated

May-June 2022

Health Promotion Region Work s hops HeldEac h region health promotion team member participated

June 2022

Held the 5th Health Promotion Conferenc e

Reported on Health Promotion Ac tiv ities 2021 and sharing ofeac h Region Health Promotion Team's Dec laration of
Ac tiv ities

August 2022

Held a health management work s hop for the management

Shared the Group's management is s ues for the management

Held the 6th Health Promotion Conferenc e

Interim Report on Health Promotion Ac tiv ities 2022

Health Management Work s hop Held

The management and repres entativ es of eac h region healthpromotion team partic ipatedDecember 2021

December 2022

87

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Organizational structure and roles
Since FY2020, the Health Promotion Council, which includes the chairman, the president, and senior management, has deliberated
and decided on policies and initiatives, while the Health Promotion Teams, which include employees from each region, have beenpromoting awareness and penetration of health and productivity management among employees and implementing specific measuresin their respective regions. The company, the labor union, and the Health Insurance Society work in unison to promote company-wide
health initiatives.

Health Promotion Conference

Education / Training
Workshop for health promotion members
The Health Promotion Secretariat plans and regularly holds a health and productivity
management workshop for health promotion members, who are responsible for promoting
health promotion measures in each region. At the workshop, health promotion members
deepen their understanding of health and productivity management, exchange views withhealth promotion members from other business sites, and share ideas about issues andsolutions for promoting health promotion measures. Thus, we support health promotion
members so that they can independently carry out health promotion activities in eachregion.

88

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Various seminars
Improvement of health literacy
We have held regular online health seminars and have provided information since FY2020
to increase employees’ health literacy and encourage behavioral changes toward better
health. In addition to the five themes set as action goals, these seminars also covermeasures to remedy stiff shoulders and lower back pain, which were topics of high interestin a questionnaire survey of employees. Moreover, to provide information that deepens
understanding of the necessity of cancer screening, a seminar on cancer is also held. The
seminars have received high levels of satisfaction from the employees who participated inthem. Since FY2022, the seminars have been recorded and streamed online to provide
more employees with the opportunity to view the seminars.

Online seminar for preventing stiff shoulders and back pain

Retention period(fiscal years)

Seminar contents

Number of participants(persons)

Understanding (%)

Satisfaction (%)

FY2020Res pons ible Drink ing Seminar

Approx .160

9895

Sleep Seminar

Approx .220

91

85

Canc er Seminar

Approx .200

98

92

Seminar for prev enting s tiffs houlders and bac k pain

Approx .250

98

89

Diet and Sleep Seminar

Approx .220

87

75

Hormone Balanc e Seminar for
Men and Women

Approx .130

8571

Oral Care Seminar

Approx .270

93

90

Diet and Body Weight (BMI)
SeminarApprox .270

93

84

Lung Canc er Seminar

Approx .210

87

83

FY 2021

FY 2022

Initiatives to support health promotion
Although the Group contains approximately 30% of young employees in their 30s, they tend to have higher health risk in terms of lifestyle habits. Accordingly, it is necessary to takemeasures to improve the lifestyle habits of employees from a young age. For the Group as a whole, behavioral changes in exercise, eating, and drinking have emerged as an issue. In
light of these health issues, we have implemented health measures since FY2020, including introducing a health support app, subsidizing the purchase of a wearable device thatvisualizes exercise and sleep, holding health seminars online, and providing smart meals and smoothies. As a result, a company-wide questionnaire survey, conducted in FY2021,
showed that the percentage of employees who exercise at least once a week had increased by approximately 20%, indicating that employees’ health literacy was increasing. We willcontinue to implement measures to encourage the behavioral changes of employees in order to lead to improved employee performance and the revitalization of the organization.

Health promotion support using the CALOmama PLUS app
We have introduced a smartphone health app “CALOmama PLUS” which allows users to record and manage their diet,exercise, and sleep data, and receive health advice from an Al assistant. Since FY2021, we have held regularcompany-wide ranking events to compete on the average number of steps they take and their health score* on the
CALOmama PLUS app. In post-event questionnaire surveys, participants answered: “It has become my habit to take awalk during my lunch break,” and “I have got into the habit of eating vegetables every day,” indicating that participationin events led to improvements in lifestyle habits such as exercise and diet.
* Health score: A score that measures the degree of health based on the diet and exercise data entered into the app

Health app “CALOmama PLUS”

89

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Promotion of smoking cessation
We strengthen our efforts to promote smoking cessation with the aim of preventing
health problems caused by smoking and preventing employees from experiencing
passive smoke.
No smoking at our business sites
As a result of the gradual reduction and closure of smoking areas with the aim ofbanning smoking at our business sites for all employees of the Group, we achieved acomplete ban on smoking at our business sites in January 2023.

Support through a smoking cessation program
We provide a smoking cessation program, in which our Health Insurance Society
covers some of the costs of receiving support through a dedicated app and online
interviews with nurses and pharmacists. In FY2021, eight employees successfully quit
smoking. In FY2022, nine employees successfully quit smoking, and two were
continuing to abstain from smoking as of March 2023.

Implementation of health checkups and follow-up measures
We conduct uniform health checkups across all Group companies, and maintain a 100% attendance rate for regular health checkups. For employees who have been determined by an
occupational physician to require a thorough examination based on their health checkup results, in-house occupational health staff follow up with them by phone or email to encouragethem to seek medical advice. We also provide advice on improving lifestyle habits to employees who are at high risk of developing lifestyle-related diseases. In the future, we aim to
reduce the number of employees who are at risk for lifestyle-related diseases (due to abnormal Fats, blood sugar, blood pressure, etc.), and achieve a 100% participation rate in athorough examination.
In FY2019, we introduced a health management system “Growbase” to centrally manage the results of regular health checkups for all employees of the Group. This has created anenvironment in which employees can check their regular health checkup results online at any time by accessing the employee page of the system.

Specific health guidance
Our Health Insurance Society continues to provide a three-to-four month lifestyle
improvement program (specific health guidance) for all those eligible for “active support” or“motivational support” as a result of specific health checkups and comprehensive medical
checkups. By carefully encouraging applications for specific health guidance and following
up the progress of the guidance, we achieved a guidance implementation rate of 94% in
FY2021, exceeding our target of 90%. In FY2022, we aim for a 100% guidance
implementation rate. Our ranking in the Health Scoring Report* has significantly improved,
to 1009th in 2018, 899th in 2019, 46th in 2020, and 7th in 2021.
* Health Scoring Report: Issued jointly by the Ministry of Health, Labour and Welfare, the Ministry of
Economy, Trade and Industry, and the Nippon Kenko Kaigi, the Health Scoring Report visualizes
changes over time in the data of each health insurance society compared to the average of all healthinsurance societies and industry averages, regarding members’ health conditions, medical costs,
and the status of disease prevention and health promotion efforts.

Health guidance for young employees
Our Health Insurance Society has focused on the health checkup results of employees in their 30s, who have the highest proportion of employees in the Group, and has begun providing
health guidance to employees under 40 who are at risk for metabolic syndrome. We aim to motivate young employees to improve their lifestyle habits.

90

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Mental health measures
Implementation of stress checks and utilization of group analysis results
We conduct a stress check once a year for all employees of the Group, including those at overseas business sites. For employees judged to be under high stress, we recommend aninterview with a doctor in an effort to prevent mental health problems. Based on the stress check results, group analysis is conducted, and its results are feedback to each organization
along with a usage guide. Based on group analysis result data, we make individual interventions in the relevant organizations when necessary to improve the workplace environment.
(unit: %)FY 2019

FY 2020

FY 2021

FY 2022

Stress check inspection
rate

99

99

98

99

Stress check high stress
rate

9.3

8.9

8.6

7.1

Implementation of mental health training
We continuously provide self-care and line manager-care training.

Measures for long working hours
To prevent health problems caused by long working hours, we use a health check sheet to assess the physical and mental health of employees who work overtime for more than 45
hours a month or on holidays, targeting all employees of the Group. When necessary, we arrange interviews between the relevant employees and an occupational physician, and work togive due considerations to their work based on the opinions of the occupational physician to ensure their health.

Average monthly overtime
hours (hours)

FY 2019

FY 2020

FY 2021

FY 2022

FY 2025(Target value)

4.8

4.4

4.8

5.2

5.0 or less

Infectious disease measures
Responses to COVID-19
On February 18, 2020, we launched the COVID-19 Headquarters. Based on the idea that each individual should take thorough infection prevention measures to prevent the spread of
COVID-19 and prepare for business continuity, we provided appropriate instructions and information on responses, requests, and rules related to COVID-19 through the intranet. We also
recommended the use of the COVID-19 contact confirmation app “COCOA,” and in January 2021, we began subsidizing some of the costs for PCR and antibody tests for employees
and their family members who wanted to be tested. These tests can be taken multiple times.

Implementation of workplace vaccinations
At the Kyoto Head Office, we completed the third round of workplace vaccinations for COVID-19. Those eligible for vaccination were not limited to employees of the Group who wished to
be vaccinated, but were expanded to include employees’ families and neighboring company employees.

Distribution of antigen test kits
At the end of 2021, infection of Omicron, which is one of the variants of COVID-19, spread rapidly, and in some areas of Japan, PCR and antigen tests were not readily available. In thissituation, we distributed antigen test kits free of charge to all employees so that they could quickly confirm whether or not they had been infected if infection was suspected.

Subsidy for influenza vaccination
Our Health Insurance Society subsidizes the cost of influenza vaccination to help prevent infectious diseases for employees and their families.

Flu vaccination rate
(Employees only) (%)

FY 2019

FY 2020

FY 2021

FY 2022

74

81

67

64

Note: Health Insurance Society subsidy for vaccinations recipient percentage

91

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Health Management External Evaluation
Health and Productivity Management recognition
We have been recognized under the Health and Productivity Management Outstanding Organization Program, jointly hosted by the Ministryof Economy, Trade and Industry(METI) and the Nippon Kenko Kaigi (Japan Health Council) for the fifth consecutive year in 2023. In thecertification system, the status of initiatives in philosophy/policy, the organizational structure, implementation of systems/measures, andevaluations/improvements is quantified and top 500 companies are certified as the White 500 based on the comprehensive evaluation pointsof these items.

Lecture at Data Health and Preventive Services Trade Fair 2021 (co-hosted online by the Ministry of Health, Labour and Welfare and the National Federation of Health
Insurance Societies)
On November 30, 2021, a seminar titled “Toward increasing the value of health insurance business through a Pay For Success private sector outsourcing system (PFS)” was held,
jointly organized by the National Federation of Health Insurance Societies and the Ministry of Health, Labour and Welfare, in which a representative from our Health Insurance Societydelivered a speech. This was because the establishment of health and productivity management in the Group and rapid improvements in specific health guidance caught the attention of
the Ministry of Health, Labour and Welfare.

“Cancer Control Promotion Company Action” award for the third consecutive year
Our Health Insurance Society was commended as a company with excellent performance in the Cancer Control Promotion Company Action program (FY2022) of the Ministry of Health,Labour and Welfare. The award was given in recognition of our efforts to promote cancer education and various cancer checkup initiatives such as colorectal cancer screening, breast
ultrasonography, uterus cancer screening, stomach cancer risk classification screening, lifestyle-related diseases checkup, and specific health guidance.
In January 2023, we held an online cancer seminar as part of the Cancer Control Promotion Company Action program,with approximately 200 participants from across the company. The seminar was recorded and streamed online at alater date to provide an opportunity for more employees to learn about cancer screening and gain correct knowledge ofcancer.

Message from the Minister of Health, Labour and Welfare for our specific health guidance implementation rate of 93.8% in FY2021

The specific health guidance implementation rate of our Health Insurance Society in FY2021 ranked among the top 10
among health insurance societies and mutual aid societies nationwide. Since this was a remarkable achievement, we
received a message of appreciation from the Minister of Health, Labour and Welfare for our efforts.

92

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Local Community / Social Contributions

We collaborate with local government agencies, educational and research institutions, and other organizations to promote science, technology, education, culture, and welfare in local
communities. In addition, by voluntarily and continuously promoting various activities such as donating to universities, medical institutions, NPOs and other organizations, crime
prevention, and traffic safety, we make contributions to society.

Social contribution policy
As a good corporate citizen, we contribute to the realization of an enriched society and sustained development.
・Our efforts
By joining forces with a wide cross-section of society and effectively using available resources, we proactively engage in social contribution activities toward thedevelopment of human resources who will lead the next generation and continue to provide solutions to social issues
・Response to the needs of countries/regions
By sharing the philosophy of social contribution within the group and coordinating with the group bases in countries and regions, we will develop social contribution
activities in accordance with the circumstances surrounding the individual countries and regions.
・Information disclosure
By disclosing information and openly sharing the results of social contributions with society, we contribute to the realization of an enriched society and sustained
development.

Kyoto traditional industry
In Kyoto, there are 74 categories of traditional industries, including Nishijin textile, Kyoto Yuzen dyeing, and Kiyomizu ware, all of which are renowned both in Japan and overseas.
However, traditional industries in Kyoto have been in a predicament, due to a decline in shipment value and a lack of successors. With the survival of some of these categories at risk,
the stagnation of Kyoto’s traditional industries has become a matter of social concern in the region.
In February 2021, we launched the “Kyoto Culture x Technology of Sanyo Chemical Group = XX Innovation” project, which revitalizes Kyoto traditional industries by Sanyo ChemicalGroup technologies.
Driven by the passion of each and every employee to leverage our company’s strengths to contribute to the revitalization of Kyoto’s traditional industries as a chemical company nurtured
in Kyoto, we will continue to take on challenges in collaboration with Kyoto City and Kyoto Prefecture.

Current status of the project
At present, we have six Traditional Industry teams, consisting of about 40 members in total. These projects are being conducted with Kyoto City, Kyoto Prefecture, and various industry
associations. These teams are working with Kyoto Prefecture and various industry associations to contribute to society through our technology, starting with Kyoto City. As future goals,
we are also considering the establishment of the Sanyo Chemical Kyoto Traditional Industry Development Fund as a subsidy program for fostering bearers of traditional industries, andthe conclusion of an agreement with Kyoto Prefecture, Kyoto City, and the Kyoto Municipal Industrial Technology Research Institute for the purpose of supporting traditional industries.
Through these activities, we want to revitalize the traditional industries of Kyoto, thereby contributing to our local communities.

93

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

On-site chemistry lessons
In each area where our business sites are located, young employees from our research facilities and factories offer on-site chemistry lessons atelementary schools while serving as teachers. In FY2022, we offered lessons at a total of 12 schools in the Kyoto area (Head Office/Head Office
Research Laboratory, Katsura Research Laboratory) and the areas where the Nagoya and Kashima factories are located, while taking measures toprevent the spread of COVID-19.
For the Kyoto area, on March 22, 2023, we received a letter of appreciation from Kyoto City and the Kyoto Chamber of Commerce and Industry for our
20 years of continuous contribution to the environmental learning project for elementary school students.

Award Certificates of Appreciationfrom Kyoto

Chemistry Classes Held in FY2022

District

Kyoto
Area

NagoyaFactory

Kashima
Factory

Number ofschools

Date of implementation

School,Event Name

Targetgrade(year)Oc tober 12, 2022

Ky oto City Aras hiy ama Elementary
Sc hool

552

Nov ember 16, 2022

Ky oto City Uji Hiramori Elementary
Sc hool

4 and 545

Dec ember 9, 2022

Ky oto City Tatehigas hi Yamaz umi
Elementary and J unior High Sc hool

693

J anuary 13, 2023

Ky oto City Rik k y o Kita Daigo Elementary
Sc hool

627

February 2, 2023

Ots u City Wak ai Elementary Sc hool

672

Marc h 7, 2023

Kameok a City Chotok u Elementary
Sc hool

6

46

February 16, 2023

Tok ai City Niwa Elementary Sc hool

5160

February 22, 2023

Tok ai Midoriy o Elementary Sc hool

590

Nov ember 26 and 27,
2022

Work s hop Collec tion in Cali☆Fes Kamis u

Age 5
and up70 *1

Dec ember 6, 2022

Kamis u City Uemats u Elementary Sc hool

6

80

6

Number ofparticipants(persons)

Total number ofparticipants(persons)

335

250

2

255 *2

4
J anuary 19, 2023

Kamis u City Suda Elementary Sc hool

638

February 2, 2023

Kamis u City Onohara Nis hi Elementary
Sc hool

467*1 An estimate of the number of participants in the event*2 Includes estimated number of event participants

Internships
In FY2022, we cooperated with an international internship program between the Technical University of Dortmund in Germany and Kyoto University, and accepted one international
student majoring in chemical engineering from the Technical University of Dortmund to our Research Department from October to November.

94

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Chemical Forestry
We have been conducting the Sanyo Chemical Woodland project in Wazuka Town,
Souraku-gun, Kyoto Prefecture since FY2009 as a part of the Kyoto Model Forest Initiative(efforts made by Kyoto Prefecture to protect and nurture the forests in Kyoto together with
Kyoto citizens who have been receiving the blessings of the forests).
With the cooperation of Wazuka Town, where the project is carried out, the Kyoto
Prefecture Yamashiro Wide Area Promotion Bureau, the Kyoto Model Forest Association,and the Kyoto Forest Instructors Association, our employees and their families volunteer in
activities such as providing a logging experience program and maintaining walking trails. In
FY2022, the Sanyo Chemical Woodland project was held three times in total, including one
time during new employee training (total number of participants: 164 people).
In addition, we provide funding to the forest management fund of the Kyoto Model Forest
Association to give support to the forest management project (thinning, etc.) in Wazuka
Town.
The results for FY2022 were a thinning area of 2.4 ha and an increase in CO 2 absorption
capacity of 10.6 ton-CO 2 per year.

Terraced rice field preservation
San Chemical Co., Ltd. has been conducting rice farming in Futagotanada, Chiba Prefecture. San Chemical Co., Ltd. conducts rice planting at the end of April, cut grass on a monthly
basis, and reap rice during the end of August to early September. The harvest rice is distributed to the employees who participated and donated it to a local children’s cafeteria. In
FY2022, the area of terraced rice fields covered was 400 m2, the rice harvest was 270 kg, and the total number of participants was 71 people (number of events: 14).

Donations (domestic)Through the Sanyo Chemical Foundation for Social Contribution, we make donations that have been requested in connection with our projects and that we wish to make on our own.
Donation(unit: million yen)
FY

2018

2019

2020

2021

2022

24.0

39.9

24.2

36.4

34.9

1.Support for academics mainly concerning chemistry

14.4

17.0

14.8

27.0

14.1

2.Support for human resource development

0.8

2.2

3.1

0.3

2.3

3.Support for the preservation of art and culture, mainly in Kyoto

1.1

1.5

0.5

1.0

4.1

4.Support for environmental conservation activities

1.1

11.0

1.6

1.6

1.5

5.Support for social contribution activities wherever possible according to local social needs andrequirements

6.6

8.1

4.2

6.5

13.0

Social contribution expenditure: Total amount (million JPY)

Donations by
Item

Note: Expenditures of Sanyo Chemical Industries, Ltd. until FY2019. Expenditures of SANYO CHEMICAL Foundation for Social Contribution since September 2019
(In FY2019, sum of Sanyo Chemical Industries, Ltd. and SANYO CHEMICAL Foundation for Social Contribution)

Support for Paralym Art
We support the independence of artists with disabilities as an official partner of Paralym Art, which is operated by the Shougaisha
Jiritsu Suishin Kikou Association. Paralym Art is an activity that promotes the social participation and economic independence ofpeople with disabilities through artistic expression.

95

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Overseas subsidiaries and affiliates
Major support activities
China
In May 2023, San-Dia Polymers (Nantong) Co., Ltd. (SDN) carried out cleanup activities
such as picking up litter at a park near the company as part of its environmental protection
activities.
Thailand
Sanyo Kasei (Thailand) Ltd. (SKT) provided support to villagers and those concerned who
were affected by floods in September 2022.
Cleaning up a park near SDN

Malaysia

Supporting victims of floods in Thailand

SDP GLOBAL (MALAYSIA) SDN. BHD. (SDPM) conducted cleanup activities as GoGreen activities at a nearby beach in Johor State.
We also provide various other support, and will continue to work to resolve social issues
overseas.

Cleaning up the coast near SDPM

Donation activities
In FY2022 as well, overseas subsidiaries and affiliates made donations to their neighboring schools and other organizations.

SDN donated about 80 sets of examination review materials worth

SKN presents a large liquid product display to a local high school in

SKT donates to construction of dedicated cerebral palsy ward inabout NT$20,000 to third-year junior high school students in China

Nantong, China

Thailand96

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Corporate Governance

Based on the Company mission, “Establish a better society through our corporate activities,” the Sanyo Chemical Group will realize sustainable growth toward the future by enhancing
both economic and social values in close cooperation with all stakeholders. To this end, we consider the establishment of corporate governance that is trusted by stakeholders to be oneof the highest priority management issues.

Corporate governance system
We are a company with an Audit & Supervisory Board. The Company has also introduced the executive officer system, under which Executive Officers execute business in accordancewith the management policy, etc., determined at meetings of the Board of Directors. In this manner, the Company clearly separates the management decision-making and supervisory
function from the business execution function.
Click here

for Corporate Governance Report (In Japanese Only)

Corporate governance structure

Directors and the Board of Directors
The term of office of Directors is one year. With the objective of strengthening the management supervisory functions, three out of nine Company’s Directors are independent Outside
Directors; moreover, the Chairperson of the Board is appointed from among Directors who are not involved in the execution of business. The Board of Directors holds a meeting, inprinciple, once a month. It makes decisions on important matters, such as management policy, and supervises the status of business execution by Directors and Executive Officers. In
FY2022, 15 meetings of the Board of Directors were held.

Audit & Supervisory Board Members and the Audit & Supervisory Board
Of four Audit & Supervisory Board Members, three are Outside Audit & Supervisory Board Members. The Audit & Supervisory Board Members not only attend Board of Directors’
meetings, Management Council meetings, and other important meetings, but also inspect important approval documents. They thus audit the status of Directors’ business execution,
capitalizing on the knowledge of inside members who are well versed in the wide range of businesses of the Company, as well as the expertise of outside members with experience
relating to financial and accounting affairs or with business management experience. In addition, as an organization under the direct control of the Audit & Supervisory Board, theCompany has established the Auditors Staff Division. The Division staff who assist the Audit & Supervisory Board Members in their duties are independent of the Directors. By
establishing this structure, we strive to secure the effectiveness of audits.

97

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Management Council
The Management Council meets once a month, in principle, to make decisions on important matters regarding business execution by Executive Officers, based on the management
policy, etc., determined at meetings of the Board of Directors.

Committees

Chairperson

FY2022Frequency of
meetings（times）

Nomination andCompensation
Committee

Chairman of
the Company

5

An adv is ory body to the Board of Direc tors . The majority of its members are Outside
Direc tors . The Committee reports to the Board of Direc tors the res ults of its deliberation onmatters regarding the nomination of Direc tors and c ompens ation for them.

Sustainable
Management
Committee

Pres ident
and CEO

2

As a body under the direc t c ontrol of the Board of Direc tors , the Committee deliberates andmak es dec is ions on the polic y for res ponding to important matters to be addres sed with highpriority, regarding the proc es s for s us tainable growth, the env ironment, s oc iety, andgov ernanc e.

Compliance
Committee

Pres ident
and CEO

1

As a body under the direc t c ontrol of the Board of Direc tors , the Committee deliberates andmak es dec is ions on bas ic polic ies and meas ures to ens ure full c omplianc e with laws andregulations .

Internal Control
Committee

Pres ident
and CEO

2

As a body under the direc t c ontrol of the Board of Direc tors , the Committee makes decisions
on the entire internal c ontrol s y s tem, and prov ides ins truc tions and s uperv is ion for theinternal c ontrol s y s tem’s dev elopment, operation, ev aluation, and improv ement activities.

Role

Standards for selection of Directors
The Company’s policy is to form a Board of Directors consisting of inside directors who have objective judgement, foresight, and insight into management issues based on the expertise,knowledge, and experience they have accumulated in sales or research, or production or general affairs departments, and Outside Directors who can proactively provide advice andsuggestions based on their rich experience from an objective perspective. In line with this policy, the Company selects candidates while taking into account the balance and diversity of
the Board of Directors, and other elements.

Standards for selection of Audit & Supervisory Board Members
The Company’s policy is to form an Audit & Supervisory Board consisting of outside members who have legal independence in addition to high levels of expertise and discernment basedon their experience in serving as a manager or person in charge of accounting in a listed company, and inside members who can express their opinions regarding objective auditing
based on their knowledge and experience of finance and accounting or other specialized fields and who are sufficiently qualified to ensure their independence from those involved inbusiness execution. In line with this policy, the Company selects candidates for the Audit & Supervisory Board with its agreement.
Reason for selection as Outside Director
Name

Aya Shirai

Independent
Director○

Supplementary explanation of
applicable items

No applic able items

Reason for selection

We hav e des ignated Ms . Ay a Shirai as an independent direc tor s ince shemeets the Company ’s independenc e s tandards and is therefore deemed to
hav e no c onflic t of interes t with our general s hareholders . She has a wealth of
ex perienc e gained through adminis trativ e ac tiv ities from her many years of
inv olv ement in munic ipal adminis tration. In addition, s he has ex perience andac hiev ements from hav ing been inv olv ed in c orporate management as anouts ide direc tor of other lis ted c ompanies . She was s elec ted as an outside
direc tor bec aus e s he is ex pec ted to c ontribute to the c ontinuous enhancementof our c orporate v alue by offering us eful findings and opinions from an
independent s tandpoint bas ed on her ex tens iv e ex perienc e and k nowledge.

98

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Name

Independent
Director

Hideaki
Obata

Yumi Sano

Supplementary explanation of
applicable items

Reason for selection○

No applic able items

We hav e des ignated Mr. Hideak i Obata as an independent direc tor since hemeets the Company ’s independenc e s tandards and is therefore deemed to
hav e no c onflic t of interes t with our general s hareholders . In addition to
ex tens iv e prac tic al ex perienc e in adminis trativ e departments mainly in HR andgeneral affairs , he has many y ears of ex perienc e and a trac k rec ord inmanagement of c ompanies with broad bus ines s domains . He was selected as
an outs ide direc tor bec aus e he is ex pec ted to c ontribute to the c ontinuous
enhanc ement of our c orporate v alue by offering us eful findings and opinionsfrom an independent s tandpoint bas ed on his ex tens iv e k nowledge andex perienc e.

○

She is a bus ines s ex ec utiv e (Kans ai
Offic e General Manager) of the Japan
Ins titute for Women’s Empowerment &Div ers ity Management, whic h is anouts ourc ed c ontrac tor of theCompany. Sinc e the annual amount ofac tual trans ac tions in the lates t fis c aly ear is les s than 2% of the ordinary
profit of the s aid ins titute, it is notc ons idered to be an organiz ation
whos e main c lient is the Company.

We hav e des ignated Ms . Yumi Sano as an independent direc tor s ince shemeets the Company ’s independenc e s tandards and is therefore deemed to
hav e no c onflic t of interes t with our general s hareholders . She has a wealth ofprac tic al ex perienc e in promoting div ers ity and dev eloping human resources ina lis ted c ompany and a public interes t c orporation. In addition, s he has
ex perienc e and ac hiev ements from hav ing been inv olv ed in c orporate
management as an outs ide direc tor of another lis ted c ompany. She wass elec ted as an outs ide direc tor bec aus e s he is ex pec ted to c ontribute to thec ontinuous enhanc ement of our c orporate v alue by offering us eful findings andopinions from an independent s tandpoint bas ed on her ex tens iv e experienceand k nowledge.

Diversity of the Board of Directors
The Company selects candidates for its Board of Directors by comprehensively considering each member’s personality and other aptitudes, in order to form a Board of Directors with agood overall balance of knowledge, experience, and ability to effectively perform its roles and responsibilities. It should also ensure it maintains an appropriate size and diversity, including
in terms of gender, internationality, professional experience, and age. To enhance our corporate value in the medium to long term in keeping with the basic philosophy described below,
the Nomination and Compensation Committee held discussions on the skill items required for the Company’s Board of Directors, and decided on the following eight items: corporate
management; compliance and risk management; understanding of diversity and sustainability; international business; R&D, production, and new business development; sales andmarketing; human resources development and training; and finance and accounting. These skill items will be reviewed and revised, if necessary, in the light of the business environmentand social circumstances.

Basic philosophy
・Contribute to society through fulfillment of the Company mission: “Establish a better society through our corporate activities”
・Steadfastly maintain a stable management base and proactively develop new businesses while leveraging the strength of our existing businesses
・Realize a WakuWaku company that respects diversity and where all employees enjoy high job satisfaction

As of June 30, 2023, the current Board of Directors consists of nine directors with knowledge in line with these skill items (including three independent Outside Directors, two of whom
are female) and four Audit & Supervisory Board Members (one of whom is an independent Outside Audit & Supervisory Board Member). Independent Outside Directors include members
who have management experience at other companies.

Compensation and incentives for Directors
Compensation, etc., for the Company’s Directors is designed to secure excellent human resources toward improving corporate performance, as well as to ensure that the compensationlevel and system reflect their duties. The compensation level and system are based on financial results, external objective data, and other factors, and the appropriateness thereof isverified by the Nomination and Compensation Committee, of which a majority of members are Outside Directors. The policy for determining compensation for Directors is deliberated on
and determined at the Board Meeting. The compensation for Directors consists of basic compensation, bonuses, and stock-based compensation.
Overview of types of compensation, etc.
Compensation
type

Overview

Basiccompensation

The bas ic c ompens ation is bas ed on the roles and res pons ibilities of eac h Direc tor, and is determined by tak ing into ac c ount the statusof financ ial res ults ov er the medium to long term and for the relev ant fis c al y ear, as well as lev els at other c ompanies . It is paid on amonthly bas is .

Bonuses

The cons olidated ordinary profit, whic h is a benc hmark for a c orporation’s profitability, is us ed as an index to rais e awareness toimprov e the financ ial res ults . The total amount to be paid is c alc ulated bas ed on the s tatus of financ ial res ults for the relevant fiscal
year and ov er the medium to long term. Alloc ation is determined bas ed on the roles and res pons ibilities of eac h Direc tor. Bonuses arepaid at c ertain timings eac h y ear.

Stock-based
compensation

Points are granted depending on the pos ition, etc . bas ed on the Share Deliv ery Regulations . In princ iple, the s hares of the Company
are deliv ered depending on the number of points when Direc tors retire.

99

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Training for Directors and Audit & Supervisory Board Members
For inside and full-time Directors and Audit & Supervisory Board Members, when they assume office, we provide explanations on relevant laws and regulations, the Company’s Articles
of Incorporation, the Board of Directors Regulations, and other internal regulations. For Outside Directors and full-time Outside Audit & Supervisory Board Members, we facilitate theirunderstanding of the Company’s businesses by conducting inspection tours of our factories and other operation sites. We also offer opportunities to acquire necessary knowledge andinformation by such means as participation in external seminars on corporate governance.
Skills matrix
SkillsName

Position

Takao Ando

OutsideR&D,
Understanding
production,of diversity Internationaland newandbusinessbusinesssustainability
development

Human
resource Finance anddevelopment accounting
and training

Corporate
management

Complianceand riskmanagement

Chairman of theCompany

●

●

●

●

●

●

●

Akinori Higuchi

Repres entativ e
Direc tor,
President and CEO

●

●

●

●

●

●

●

Kohei Maeda

Repres entativ e
Direc tor

●

●

●

●

●

Masahiro Harada

Direc tor

●

●

●

●

Hiroyuki Susaki

Direc tor
(newly appointed)

●

●

●

Kenichi Nishimura

Direc tor
Direc tor

Hideaki Obata

Direc tor●●

Yumi Sano

Direc tor

●
●
●
●

●

Aya Shirai

●
●
●
●

Hirokazu Kurome

Audit &
Superv is ory
Board Member

●

●

●

Takafumi Horiie

Audit &
Superv is ory
Board Member

●

●

●

Jun Karube

Audit &
Superv is ory
Board Member

●

●

●

●

Yusuke Nakano

Audit &
Superv is ory
Board Member

●

●

●

●

●
●
●

Independent

●
●
●

●

●

Sales andmarketing

●
●

●

●

●

●

●
●
●

●
●

●
●

Major discussion topics and themes
Board of Directors
・Formulation of the Medium-Term Management Plan and the Comprehensive Plan
・Policy on operating major businesses
・Matters regarding investment, financing, and donations
・Confirmation of the results of the effectiveness evaluation of the Board of Directors
・Matters on which to seek advice from the Nomination and Compensation Committee
・Approval of closed financial statements
・Matters regarding procedures for the general meeting of shareholders
・Resolutions on conflict-of-interest transactions, Directors’ liability insurance, etc., appointment and dismissal of important employees, and matters related to compensation for Directors
based on the Companies Act

100

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Nomination and Compensation Committee
・Rearrangement of the structure (skills matrix) of the Board of Directors, including Audit & Supervisory Board Members
・Establishment of the ideal image of the President and CEO; study of a plan for the successor of the Representative Director, President and CEO, including the evaluation criteria andfostering method
・Study of evaluation indices for performance-linked compensation
・Study of the payment ratio by the compensation type

Sustainable Management Committee
・Efforts to improve economic value
・Methods of disclosure of non-financial information
・Formulation of a human capital policy and a human rights policy
・Initiatives to address climate change

Compliance Committee
・Implementation and planning of corporate ethics study meetings
・Results of the use of whistleblowing contact points for consultation or reporting
・Revision of the Whistleblowing Regulations
・Policy of risk management activities

Internal Control Committee
・Results of the evaluation of internal control activities related to financial reports
・Regarding proposals for disclosing the operational status of the Internal Control System in the Business Report・Results of the evaluation of the operational status of the Internal Control System regarding significant risks other than those included in financial reports

Effectiveness evaluation of the Board of Directors
The Company conducts an anonymous questionnaire survey on the effectiveness of the Board of Directors targeting all the Directors (nine persons), including Outside Directors, and all
the Audit & Supervisory Board Members (four persons), including Outside Audit & Supervisory Board Members and evaluates the effectiveness of the Board of Directors based on the
results. In FY2022, the questionnaire survey on the Board of Directors was conducted based on the main items below.
1. Composition and operation of the Board of Directors
2. Discussions at Board of Directors meetings
3. Monitoring function of the Board of Directors
4. Performance of Directors
5. Support system and training for Directors and Audit & Supervisory Board Members
6. Dialogue with shareholders
7. Efforts made by each Director
Respondents were asked to rate each item on a five-point scale or give a comment based on free description for each question. The survey was conducted in March 2023 using a thirdparty system to ensure objectivity. The results were reported to the Board of Directors meeting held in May 2023. Discussions were held and analysis was conducted based on theaggregate results of the ratings on a five-point scale and comments in the free description fields of the questionnaire survey, to evaluate the effectiveness of the Board of Directors. The
previous year’s evaluation results indicated that there was room for improvement in terms of “reinforcing the governance system,” “improving discussions on management strategies
from a medium- to long-term perspective,” and “enhancing support to Outside Directors,” in order to further improve the effectiveness of the Board of Directors. This year’s results
showed certain improvement in these matters. Based on the answers to the questions in the above questionnaire, it was evaluated that the effectiveness of the Board of Directors was
generally ensured. Notably, regarding the operation of the Board of Directors, a Director who does not execute business serves as the Chairman of the Board of Directors to proceedwith a meeting. We thereby endeavor to ensure operation from a fair viewpoint. Meanwhile, to further enhance the effectiveness of the Board of Directors into the future, we recognize theneed for continuous improvement in terms of “reinforcing the governance system,” “improving discussions on management strategies from a medium- to long-term perspective,” and“enhancing support to Outside Directors,” for which we previously found that there was room for improvement. We will be committed to making improvements to address these issues.

Succession plan (plan to foster successors)
In FY2022, the Nomination and Compensation Committee discussed the establishment of “the ideal image of the President and CEO” in conformity with the corporate management
principles and management strategies as well as the process to select a candidate for Representative Director, President and CEO and the systematic fostering method to achievesustainable growth of the Company and improve the medium- and long-term corporate value, and made a report to the Board of Directors. In particular, regarding the “ideal image of the
President and CEO,” the committee identified the requirements that should be met by the next Representative Director, President and CEO to realize the vision of the Group by FY2030,
which was specified in the management policy announced last year under the Company mission, “Establish a better society through our corporate activities.” The Nomination andCompensation Committee also discussed the next-generation candidate in anticipation of the Representative Director, President and CEO in about 10 years’ time and the method of
fostering female candidates for Executive Officers, and made a report to the Board of Directors.

101

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

ComplianceWe, the Sanyo Chemical Group, declared in our Code of Corporate Ethics that it is essential corporate behavior to ensure legal compliance and to fulfill corporate social responsibility,
which has been implemented to take the lead in the realization of a sustainable society. With good sense and integrity, we are committed to improving our society and are following ourcompany mission, “Establish a better society through our corporate activities.”

Compliance system
We have appointed a Director in charge of corporate ethics and established the Compliance Committee, which is under the direct control of the Board of Directors.
The Compliance Committee is a deliberative and decision-making body on the basic policy and measures regarding compliance. The committee holds regular meetings. In FY2022, thecommittee studied the content to be learned by employees at corporate ethics study meetings, which are held on a company-wide basis, identified important risks that can be reduced
through compliance activities, and formulated countermeasures.
We have also set up the Auditing Division under the direct control of the President, so as to strengthen our internal auditing function.
Compliance promotion structure

The Advice on Compliance and the Code of Conduct for Employees establishes specific criteria on daily behavior for employees.

Internal auditing
The Auditing Division conducts internal auditing. It objectively inspects and evaluates the business management and operation systems and the status of business execution in terms oflegitimacy, effectiveness, and efficiency. Based on the results, it makes proposals for improvement or corrective recommendations, in order to facilitate the Company's soundmanagement and sustainable development.

Education activities
Corporate ethics study sessions
Every year, the Sanyo Chemical Group holds sessions to study corporate ethics across all departments with the objective of preventing the occurrence of corporate misconduct. In
recent years, these sessions have placed particular focus on the kind of corporate culture that may form the background to corporate misconduct. Participants learn that corporate
culture reform leads to improved compliance by watching videos (short dramas). In FY2022, participants watched a video on the theme of “a workplace where negative information isreported” and held group discussions. In total, 1,885 participants joined the sessions. After the sessions, a questionnaire survey was conducted to evaluate the overall complianceactivities of the Group and reflect the results on the education activities in the following fiscal years.
Legal consultant program
Employees of the Legal Affairs Department offer legal consultants for Group employees in Japan. They give lectures on various themes. Personnel in charge of the Legal Affairs
Department are designated as contact persons for respective organizations (including business divisions and subsidiaries and affiliates). Employees of the Legal Affairs Department visit
respective business sites in Japan and offer legal consultation services (“visiting legal services”). Such arrangements make it easy to seek legal advice.

102

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Training content for FY2022
Contents

Target group

Contract Basics

Employ ees in their firs t to fifth y ear of employ ment

Antimonopoly Act (Restriction of Trade and Business
Alliance)

Sales s taff

Prevention of Fake Contracts

Employ ees work ing with s ubc ontrac tors

Export Trade Control OrderRes earc h s taff

Industrial Waste Disposal Consignment Agreement

Employ ees inv olv ed in the c onc lus ion of indus trial was te dis pos al c ons ignment c ontracts

Non-Disclosure Agreement (NDA)

Employ ees involv ed in the s igning of non-dis c los ure agreements

Joint development and joint application

Res earc h Young and mid-c areer employ ees

Subcontract Act

Employ ees work ing with s ubc ontrac tors

Trade secrets

Sales and res earc h s taff

Internal whistleblowing system
If an employee becomes aware of a compliance problem, the employee should basically discuss it with his/her supervisor and/or the personnel concerned. However, if the problem
cannot be resolved through such discussions, the whistleblowing contact points (compliance hotline) that conform with the Whistleblower Protection Act are set up both inside theCompany and outside in accordance with the internal Whistleblowing Regulation. The General Manager of the Auditing Division, who is a member of the Compliance Committee
Secretariat, serves as the internal contact point for whistleblowing. The corporate lawyer is available for the contact point outside the Company. We operate the regulation requiring thatthe whistleblowers’ confidentiality be carefully protected to prevent the identification of whistleblowers.
In FY2022, four reports in total were submitted through the compliance hotline. All of these reports were related to harassment. The facts were investigated with utmost care so thatwhistleblowers would not be disadvantaged. For problems identified, guidance was offered and disciplinary action was taken for target individuals, and education was offered to correct
the situation.
Previously, the Sexual Harassment, Maternity Harassment, and LGBT Contact Points dedicated to harassment problems were in place separately from the whistleblowing contact points.
In April 2023, a consultation desk for harassment problems was newly established outside the Company. A mechanism will be created so that the whistleblowing contact points and theconsultation desk are readily accessible to whistleblowers (employees seeking consultation services). The status of operation of the whistleblowing contact points is reported to theCompliance Committee.
Number of whistleblowing cases
FY

2018

2019

2020

2021

2022

Number of cases

1

4

1

2

4

Action against violations
Action to be taken when compliance violations are found (e.g., procedures, or announcements in or outside the company) is stipulated in the Compliance Committee Regulations.
When a violation is found, facts are scrutinized and punishment is determined based on the Rules of Employment and Disciplinary Actions Regulations in light of internal regulations,
including the Operational Responsibilities Regulations. Company-wide measures to prevent recurrence are discussed and determined. In FY2022, there were four cases subject todisciplinary actions. Specifically, three cases were related to harassment, and one case was related to violation of company policy.

Fair trade and anti-corruption
Sanyo Chemical is a member of the United Nations Global Compact. The Code of Corporate Ethics and the Code of Conduct for Employees stipulate commitment to “fair competition,
proper transactions, and responsible procurement.” The Operational Responsibility Regulations of business divisions require the “prevention of unlawful transactions and acts, prohibitionof bribery, and confirmation of non-violation of export regulations and laws related to chemical substances in respective countries.” Education is offered to employees through “egalconsultants.”
We do not violate antimonopoly laws, antitrust laws, or competition laws of respective countries.
Political donations
We do not make political donations.
Transparency regarding the provision and use of research funds, etc.
In accordance with the "Transparency Guidelines" with medical institutions set forth by the Japan Association of Laboratory Medicine and the Japan Federation of Medical Devices
Industries, we have established "Guidelines for Transparency in Relationships with Medical Institutions, etc." and announce the status of implementation every year.
Click here

for the Guidelines for Transparency in Relationships with Medical Institutions and public information(In Japanese Only).

In addition, we have announced the appropriate operation and management system for public research expenses.
Click here

for Management System for Public Research Funds(In Japanese Only).

103

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Risk Management

To avert business continuity crises and prepare for unforeseen circumstances, the Sanyo Chemical Group has established internal regulations to cope with each possible risk. We
conduct risk management by raising the risk awareness of employees by providing training and holding drills.

Risk management system
In order to address risks surrounding the Group, internal regulations such as the Operational Responsibilities Regulations, the Basic Regulations for Product Liability (PL), and theInformation System Security Regulations have been formulated, and the departments in charge shall manage the risks. The Auditing Division (Business Auditing Department or TechnicalAuditing Department) under the direct control of the President monitors the status of risk management with the Group. If a risk is identified, the Auditing Division gives instructions toformulate correction and recurrence prevention measures, checks the details, and follows up on the status of implementation by the relevant departments. Regarding importantcompliance risks, the Compliance Committee discusses and determines the basic policies and measures.

Risk-based audit
In collaboration with the Internal Control Dept., the Business and Technical Auditing Departments conduct internal audit across the organization by preparing a risk-based audit map for
performing business and operations and by setting audit themes for each fiscal year with priorities taken into account.

Business continuity plan (BCP)The Group draws up and operates BCPs that prepare for response in the event of a massive earthquake or a pandemic. The Internal Control Department of the BCP Secretariat takes
the initiative in conducting a review every year to make the BCP further effective. We also continuously hold practical drills in each region.

Information management
Information assets are crucially important for companies. Leakage of information assets is likely to pose the risk of damaging corporate value. Recognizing the importance of confidential
information, we have the Security Management Regulations in place to prevent information leakage, ensure proper use, and prevent unauthorized acquisition, use, and disclosure ofconfidential information of third parties. We ensure security by establishing the Information System Security Regulations and the Personal Computer and Network Management
Regulations, introducing a firewall and other network security systems, managing licenses for the use of information systems, and limiting access to the Internet. To raise the security
awareness of employees and prevent information security accidents, we offer information security education every year.
Personal information protection
As for the protection of personal information, we have laid down the Personal Information Protection Policy, which stipulates the purpose and methods of use of personal information andits management, as well as consultation procedures regarding such information. The policy was revised in line with the amended Act on the Protection of Personal Information, whichcame into effect in April 2022. We have the Personal Information Protection Management Regulations in place to realize appropriate protection under this policy. Regarding the Individual
Number (My Number) system, rules are established in the Specific Personal Information Handling Regulations. An IT system capable of ensuring security is used for operation. We also
comply with the Social Media Policy, which was formulated regarding the operation of official social media accounts and the use of social media by respective employees.

Overseas crisis management activities
The Sanyo Chemical Group has established and implemented the Basic Regulations for Overseas Crisis Management, which set forth basic points for reducing risks that may cause
harm to the lives, bodies, and property of the Group employees outside Japan, and for responding to an overseas crisis if such an event should occur. The regulations specify the crisis
management organizations and the chain of command that will function in the case of emergency and define the responsibilities and authority of the Overseas Crisis Management
Secretariat and the response headquarters, so that appropriate responses can be made accordingly. The Overseas Crisis Management Secretariat is established within the Personnel
Division to constantly gather and analyze information and issue overseas travel warnings as necessary. When a BCP is implemented, the overseas crisis management organizations will
work in coordination with the Business Continuity Task Force.

104

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Internal control
We, the Sanyo Chemical Group, declared in our Code of Corporate Ethics that it is essential corporate behavior to ensure legal compliance and to fulfill corporate social responsibility,
which has been implemented to take the lead in the realization of a sustainable society. With good sense and integrity, we are committed to improving our society and are following ourcompany mission, “Establish a better society through our corporate activities."
Structure

Internal control bodies and their roles
Internal Control Committee
The Internal Control Committee is in place under the direct control of the Board of Directors. The Internal Control Committee determines the basic policy on the overall internal control
system, and provides instructions and supervision for the development, operation, evaluation, and improvement activities for the system.
Internal Control Dept.
The Internal Control Dept. gives advice on planning measures to cope with and avoid various risks related to business operations. The Internal Control Dept. is also responsible forbuilding, evaluating, improving, and reporting on the three internal control systems.
1. Internal control related to the Companies Act
2. Internal control related to financial reports (in accordance with the Financial Instruments and Exchange Act)
3. Internal control related to risks other than financial reports
Regarding internal control related to the Companies Act, the basic policy on the internal control system was resolved by the Board of Directors and publicized in 2006 in accordance with
the Companies Act and the Regulations for Enforcement of the Companies Act. It is reviewed as appropriate.
Regarding internal control related to financial reports, operational processing control and overall IT control, from company-wide internal control and sales to the financial reporting
process, are evaluated. The results are compiled as the internal control report and are reported to the Internal Control Committee. The internal control audit report prepared by theaccounting auditor is attached and submitted to the Kanto Finance Bureau.
Regarding internal control related to risks other than financial reports, a set of documents, including procedures for risk reduction measures against expected risks and self-checksheets, are prepared and posted on the intranet so that employees can read them at any time.

105

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

ESG Performance Data

Environment

SocialScope of data aggregation
On the following pages, the above-listed terms are to indicate the scope of data aggregation.
SCI indicates all facilities in Sanyo Chemical Industries, Ltd.
“Domestic” indicates SCI plus domestic affiliates/subsidiaries.
“Overseas” indicates overseas affiliates/subsidiaries that have production facilities.
In case of no specific note, the scope is “domestic” plus “overseas.”

ISO certification

106

GovernanceSANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Non-production Base

Production Base

Location

Facility

ISO14001

ISO9001Year
established(in operation)

Year acquired

Certification
authority

Year acquired

Certification
authority－

Sany o Chemic al Kas hima Fac tory

1977

－

－

1997

JCQA

－

Sany o Chemic al Ky oto Fac tory

1949

－

－

1999

JCQA

－

Sany o Chemic al Nagoy a Fac tory

1969

－

－

1998

JCQA

－

Sany o Chemic al Kinuura Fac tory

2010

－

－

2010

JCQA

①

SDP Global Co., Ltd.

2001

－

－

2000

JCQA

②

San Chemic al Co., Ltd.

1982

－

－

2000

JCQA

③

SAN NOPCO LIMITED

1966

－

－

2000

JCQA

④

San-Petroc hemic als Co., Ltd.

1977

－

－

－

－

⑤

Sany o Kas ei (Thailand) Ltd.

1997

2009

TICA/J -VAC

2004

TICA/J-VAC⑥

Sany o Kas ei (Nantong) Co., Ltd.

2003

2012

TUV NORD

2006

TUV NORD⑦

San-Dia Poly mers (Nantong) Co., Ltd.

2003

2013

CQM

2007

DET
NORSKE
VERITAS⑧

SDP GLOBAL (MALAYSIA) SDN. BHD.

2015

－

－

－

－

⑨

Sanyo Chemic al Tex as Indus tries , LLC

2005

－

－

－

－

⑩

San-Apro Ltd.

1966

－

－

2003

JCQA

⑪

Sany o Chemic al Logis tic s Co.,Ltd.

2020

－

－

－

－

⑫

Shiohama Chemic als Warehous eCo.,Ltd.

1983

－

－

－

－

Note: The four Sanyo Chemical factories and domestic affiliates/subsidiaries ① through ④ will discontinued their ISO 14001 certification in FY2020. ④San-Petrochemicals Co., Ltd also discontinued its ISO
9001 certification in FY2020.

107

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental investment and environmental effects
Environmental accounting results:
Based on Ministry of the Environment (Japan) Guidelines[Scope] Sanyo Chemical, seven domestic subsidiaries/affiliates, and five overseas subsidiaries/affiliates with production facilities
Environmental protection cost
Classification

Investment/expenses (unit: million yen)
2018

2019

2020

2021

2022

(1) Pollution prevention costs

122／864

172／872

260／843

216／842

297／875(2) Global environment costs

39／622

83／67681／65064／671

27／663(3) Resource recycling costs

28／1,771

64／1,932

41／1,850

1／1,794

1／1,898

Upstream/downstream costs

0／28

0／30

0／34

2／40

0／33

Administrative costs

6／397

3／417

1／459

55／475

3／505

R&D costs

0／688

0／506

0／464

0／663

0／730

Social activity costs

0／129

0／138

0／124

0／132

0／138

Environmental remediation costs

0／4

0／3

20／5

0／3

0／4

195／4,504

322／4,573

404／4,428

338／4,620

327／4,846

Facility area costs

Total

Note: The investment amount is based on the acceptances during the corresponding period.

The expense amount includes depreciation.

Environmental conservation measures by category

Investment/expenses (unit: million yen)Classification

2018

2019

2020

2021

2022

27／61565／67540／633

19／64634／642(2)Costs related to ozone layer protection measures

0／1

1／1

0／1

1／5

0／2

(3)Costs related to air quality conservation measure

71／41965／395185／394232／391

224／408(4)Costs related to noise and vibration

3／70

3／73

5／75

1／64

0/74

(5)Cost related to environmental conservation measures for the aquatic, ground, and geologic
environments

45／39998／426

136／41473／43262／456(6)Costs related to waste product and recycling measures

35／
1,778

69／
1,940

34／
1,857

1／1,803

1／1,906(7)Costs related to measures for reducing chemical risk and emissions

0／225

0／234

0／282

0／277

0／259

(8)Costs related to natural environmental conservation

0／13

10／19

0／16

3／17

1／16

(9)Other costs

16／295

11／304

3／292

9／322

5／354

Total

195／
3,816

322／
4,068

404／
3,963

338／
3,957

327／
4,116

(1)Costs related to global warming measures

Note: Expenses for research and development are not classified.

108

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Economic impact(unit: million yen)

Results

2018

Energy saving

Resource saving

2019

2020

2021

2022

72

81

6

41

20

Waste reduction

141

97

48

77

7

Raw material use reduction (yield improvement)

227

178

174

152

82

Revenue from recycling

26

80

52

55

70

466

436

279

325

179

Total
Note: Including effects of measures that do not involve investment (e.g., improvement of the manufacturing processes)

Environment/safety/accident prevention investments
FY(unit: million yen)

2018

2019

2020

2021

2022

Environment conservation

195

322

404

338

327

Safety/accident prevention

478

425

344

391

611

Total

673

747

747

729

938

109

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental complaints
Unit

Claims and complaints on pollution, administrative guidance and lawsuit
on environment, etc.

Scope

Cas es

2018

2019

2020

2021

2022

Domes tic01
(Nois e c omplaints )

0

0

0

Ov ers eas

0

0

0

0

0

Total

0

1

0

0

0

JEPIX：Japan Environmental Policy Priorities Index

Note: JEPIX (http://www.jepix.org) Calculated using PEPIX Calculation Sheet Ver. 2.0.
The smaller the EPI, the better the environmental efficiency.

Climate change related data
Energy consumption and GHG emission
Unit

Production volume

Raw materials

GHG emissions *１

Energy consumption

CO2 emissions as a consignor*2

tons

tons

CO 2 tons

k L in c rude oil equiv alent

CO 2 tons

Scope

2018

2019

2020

2021

2022

Domes tic

407,180

370,681332,320

343,716

317,848

Ov ers eas

175,204

201,817

238,468

179,998

149,516

Total

582,384

572,498

570,788523,714467,365

Domes tic

478,147435,736

383,120400,002362,825

Ov ers eas

228,727

267,626

319,739

236,875

198,151

Total

706,874

703,363

702,859

638,877

560,976

Domes tic

192,372

176,494

157,435

152,579

146,226

Ov ers eas

120,842

134,731

150,568

123,562

109,031Total

313,214311,225

308,003

276,140

255,257

Domes tic

95,87590,037

81,07381,01378,229Ov ers eas

49,20557,32264,981

51,20544,993

Total

145,080

147,359

146,054

132,218

123,221

Domes tic

11,931

11,596

10,39810,3688,765*1 Calculated in conformity with the Act on Promotion of Global Warming Countermeasures. However, the CO2 conversion factors for electricity in overseas facilities is according to the U.S. Energy
Information Administration (EIA) figures in the case of the U.S.A. and the Institute for Global Environmental Strategies (IGES) figures in the case of China, Thailand, and Malaysia.
*2 Total domestic transportation of Sanyo Chemical Industries, Ltd., SDP Global Co., Ltd., and SAN NOPCO LIMITED110

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Indicator concerning energy saving and GHG emission reduction
Unit

Scope

2018

2019

2020

2021

2022

Domes tic

17,837

15,894

15,975

13,165

13,332Ov ers eas

847

2,177

2,824

2,782

3,047

18,684

18,071

18,79915,946

16,379Domes tic

13

13

12

13

13

Ov ers eas

50

26

30

32

20

Total

63

39

42

45

32

Domes tic

－

－

13

39

11

25.8

41.6

47.7

49.4

49.3

17.8

15.2

13.0

17.1

18.4

32.0

32.3

30.4

33.0

33.1

1.6

2.2

2.0

0.8

0.5

Natural gas

32.4

33.8

35.6

37.6

38.1

LPG

16.2

16.5

19.1

11.6

10.0

Energy generated on-site (cogeneration)k L in c rude oil
equiv alent

Total

Renewable energy use (solar power
generation)k L in c rude oil
equiv alent

Increase in forest CO 2 absorption*1

CO 2 tons

CO 2 reduction by using our products *2

10,000 CO 2 tons－

Purchased electric
power
Purchased steam
Energycomposition

Fuel oil%

Domes tic andov ers eas*1 The increase in absorbed CO2 thanks to forest tree thinning projects.
*2 CO2 reduction volume associated with the use of our products compared to conventional products is multiplied by sales volume in a fiscal year.

111

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GHG emissions in Scope 1, 2, 3

Cat.: category (unit: CO2 tons)
2018

2019

2020

2021

2022

Scope 1 Direct emissions

164,993

172,349

181,509145,753130,031

Scope 2 Indirect emissions from the use of electricity, heat, or steam supplied by others

148,038

138,876

126,495

130,283

125,226

Scope 3 Supply chain emissions sum of categories

2,803,414

2,575,909

2,322,571

2,393,925

2,512,571

Cat.1*1 Purchased goods and services

1,438,389

1,317,142

1,178,559

1,216,830

1,448,976

Cat.2 Capital goods

27,90918,974

18,367

20,922

19,670Cat.3 Fuel and energy-related activities (not included in Scope 1 or Scope 2)

28,39625,96924,564

24,21923,853

Cat.4 Upstream transportation and distribution

30,83629,24021,78926,482

20,780Cat.5 Waste generated in operations

12,525

12,404

409

812

820

Cat.6 Business travel

188

185

189

184

181

Cat.7 Employee commuting

475

475

476

472

463

Cat.8*2 Upstream leased assets

－

－

－

－

－

Cat.9*3 Downstream transportation and delivery

－

－

－

－

－

Cat.10*3 Processing of sold products

－

－

－

－

－

Cat.11*3 Use of sold products

－

－

－

－

－

1,211,933

1,118,975

1,027,575

1,055,712

948,355

Cat.13*2 Downstream leased assets

－

－

－

－

－

Cat.14*5 Franchises

－

－

－

－

－

Cat.15 Investments

52,76352,54550,64347,39149,473

Cat.12*4 End-of-life treatment of sold products

Note: Scope 3 was calculated based on the Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout the Supply Chain issued by the Ministry of the Environment.
(https://www.env.go.jp/earth/ondanka/supply_chain/gvc/en/files/GuideLine.pdf) and by reference to the Ministry of the Environment's Policy on Emissions Unit Values for Accounting of Greenhouse
Gas Emissions, etc., by organizations throughout the supply chain.
[Scope of Calculation]
・Scope 1, Scope 2: Sanyo Chemical, domestic affiliates/subsidiaries, overseas affiliates/subsidiaries with production facilities
・Scope 3 Cat. 1-7: Sanyo Chemical Industries, Ltd., SDP Global Co., Ltd., San Chemical Co., Ltd.
・Cat. 12: Sanyo Chemical Industries, Ltd., SDP Global Co., Ltd., San Chemical Co., Ltd., a part of sales products of overseas affiliates/subsidiaries
・Cat. 15: Sanyo Chemical Industries, Ltd.
*1 Changed the coefficient of CO2 conversion of purchased raw materials to "IDEA ver.2" of the National Institute of Advanced Industrial Science and Technology (AIST) from FY2022.
Before FYE2021: "Common Unit CO2 Conversion Database ver. 4.01," Ministry of the Environment of Japan, Carbon Footprint System Pilot Project*2 Only the leases within the group and calculated in Scopes 1 and 2*3 Collection of data necessary for calculation was difficult and no calculations was made.
*4 Until FYE2021, biomass feedstock was deducted from the total, but The calculation was changed to be calculated without deductions beginning in FY2022, and the figures were revised accordingly prior to
FY2021. The figures for Scope 3 total have been revised accordingly.
*5 Out of scope as there were no relevant activities

112

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Waste and resource saving related data
Unit

Waste generated

Waste emissions

Recycled waste*1

Recycle rate*2

Landfill

Landfill rate*3

tons

tons

tons

％

tons

％

Scope

2018

2019

2020

2021

2022

domes tic

53,95950,90744,70538,324

34,587ov ers eas

6,919

8,302

8,803

7,891

9,607

Total

60,87859,20953,50846,21544,194domes tic

20,454

18,453

16,665

14,59014,541ov ers eas

6,741

8,236

9,004

7,424

8,562

Total

27,195

26,68925,66922,013

23,103domes tic

21,526

19,91016,194

12,113

7,113

ov ers eas

1,073

2,986

3,891

3,315

4,508

Total

22,60022,89620,085

15,428

11,621

domes tic

39.9

39.1

36.2

31.6

20.6

ov ers eas

15.5

36.0

44.2

42.0

46.9

Total

37.1

38.7

37.5

33.4

26.3

domes tic

2.5

15.7

2.0

1.0

2.5

ov ers eas

14.0

7.6

3.0

5.1

3.9

Total

16.5

23.3

5.0

6.1

6.4

domes tic

0.00

0.03

0.00

0.00

0.01

ov ers eas

0.20

0.09

0.03

0.06

0.04

Total

0.03

0.04

0.01

0.01

0.01

*1 The total value of the recycle amounts both inside and outside the company, including thermal recycling*2 Ratio of recycled volume to waste generated: Amount of recycled waste ÷ Amount of waste generated×100*3 Ratio of final landfill disposal to waste generated: Final landfill disposal volume ÷ waste generated×100
Note: Since there may be inaccuracies in the waste data, a retrospective review is planned for FY2023.

113

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Water resource related data
Unit

Scope

2018

2019

2020

2021

2022

domes tic

154

143

132

137

139

ov ers eas

111

244

263

284

261

Total

265

387

395

421

400

domes tic

0

0

0

0

0

ov ers eas

0

0

0

0

0

Total

0

0

0

0

0

domes tic

3,621

3,531

3,367

3,558

3,513

ov ers eas

440

436

507

315

421

Total

4,060

3,967

3,873

3,874

3,933

Domes tic and ov ers eas

4,325

4,354

4,269

4,295

4,333

domes tic

3,730

2,894

2,738

3,039

3,024

ov ers eas

124

114

149

132

274

Total

3,854

3,008

2,887

3,171

3,298

domes tic

150

161

117

156

142

ov ers eas

40

29

23

17

29

Total

189

190

140

173

171

domes tic

0.70

0.62

0.83

0.77

0.97

ov ers eas

0.00

0.00

0.00

0.00

0.00

Total

0.70

0.62

0.83

0.77

0.97

domes tic

6.3

4.6

5.0

4.2

4.0

ov ers eas

1.1

0.8

0.6

0.8

1.3

Total

7.3

5.3

5.6

5.0

5.3

thous and m 3

Drinking water

thous and m 3

Ground water

thous and m 3

Industrial water

thous and m 3

Total water usage

thous and m 3

Water discharge

COD in water discharge

tons

Total phosphorus in water discharge

Total nitrogen in water discharge

tons

tons

* We don’t use sea water.

Discharge area and environmental impact (domestic, FY2022)
Unit

Nagoya area

Kawasaki area

Kashima area

Kyoto area

San Chemic al Co.,Ltd.

Kas hima Fac tory
San-Petroc hemic als
Co., Ltd.

Ky oto Fac tory
Head Offic e,
Res earc hLaboratory andKats ura Res earc hLaboratory

Is e BayTok y o Bay

Sewage Sy s tem

Sewage Sy s tem

Nagoy a Fac tory
SDP Global Co.,Ltd.
SAN NOPCO
LIMITED

Business facilities

Discharge area

Kinuura area

Kinuura Factory

Sewage System

Waterdischarge

thousand
m3

1,924

116

838

144

1

CO D

tons

10.9

2.9

127.4

1.2

0.0

Phosphorus

tons

0.3

0.0

0.6

0.1

0.0

Nitrogen

tons

1.4

0.3

1.9

0.4

0.0

114

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Chemical substance emission data
Emissions to the air
2018

NOx

SOx

Soot and dust

VOC emissions *1

tons

tons

tons

tons

2019

2020

2021

2022

domes tic

62

66

87

39

89

ov ers eas

25

105

36

20

15

Total

87

171

123

60

104

domes tic

1.0

0.8

1.1

1.6

0.6

ov ers eas

22.8

70.1

10.0

5.0

4.1

Total

23.7

70.9

11.1

6.6

4.7

domes tic

4.3

4.3

3.1

2.0

4.6

ov ers eas

21.1

23.1

3.9

2.2

1.9

Total

25.4

27.4

7.0

4.2

6.5

domes tic

75

89

70

73

66

ov ers eas

7

22

23

17

8

Total

82

112

93

90

74

Substances subject to the PRTR Act ; Release to air

tons

domes tic

44

48

44

47

42

Substances subject to the PRTR Act ; Release to
water

tons

domes tic

0.5

0.6

0.4

0.4

0.3

Substances subject to the PRTR Act ; Transfer to
waste

tons

domes tic

584

518

365

577

517

147

184

106

252

102

318

403

280

827

339

2

0

3

1

1

kg
Fluorocarbons leakage
CO2 equivalent
Ozone-depleting substance*2

CO 2 tons

domes tickg
CFC-11*1 Total emission of substances subject to the revised and former PRTR law, and the substances specified by the Japan Chemical Industry Association.
*2 The HCFCs leakage from refrigeration and air conditioning equipment according to the Fluorocarbons Recovery and Destruction Law was converted to CFC-11 volume equivalent.

115

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Emission/transfer of substances subject to PRTR Law (domestic)
Substances of which more than 0.01 tons of annual emissions were released to the air or water, or transferred to waste are listed below.

(unit: tons)
Base

Nagoya Factory

Cabinet ordernumberCabinet order name

Releaseto airRelease to
waterTransfer to
waste

0

0.06

0

001

Zinc water-s oluble c ompounds

004

Ac ry lic ac id and its water-s oluble s alts

0.90

0.00

0

009

Ac ry lonitril

0.05

0

0

037

4,4'-Is opropy lidenediphenol (s y nony m: Bis phenol A)

0

0.02

0

053

Ethy lbenz ene

0.13

0.00

0

056

Ethy lene ox ide

0.08

0

0

058

Ethy lene gly c ol monomethy l ether

0.06

0

0

066

1,2-Epox y butane

0.29

0

0

068

1,2-Epox y propane (s y nony m: Propy lene ox ide)

1.68

0

0.0

080

Xy len

0.08

0.00

0

134

Viny l ac etate

0.04

0

0

178

1,2-Dic hloropropane

0.87

0.01

0.1

232

N,N-Dimethy lformamide

0.16

0.09

40.0

300

Toluene

4.90

0.00

0

398

Benz y l c hloride

0.03

0

0

405

Boron c ompounds

0

0.05

0

9.29

0.24

40.2

95 Subs tanc es handled

Total releas e or trans fer amount116

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Base

Kashima Factory

Cabinet ordernumberCabinet order name

Releaseto airRelease to
waterTransfer to
waste

003

Ethy l ac ry late

0.02

0

0

004

Ac ry lic ac id and its water-s oluble s alts

0.03

0

0

007

n-Buty l ac ry late

0.10

0

0

008

Methy l ac ry late

0.02

0

0

053

Ethy lbenz ene

1.04

0.02

110.3

065

Epic hlorohy drin

1.44

0.01

4.8

076

ε-Caprolac tam

0.03

0

0

080

Xy len

0.61

0.02

73.6

123

3-Chloropropene (s y nony m: Ally l c hloride)

0.43

0

0

128

Chloromethane (s y nony m: Methy l c hloride)

15.14

0

0

131

3-Chloro-2-methy l-1-propene

0.07

0

0

134

Viny l ac etate

0.31

0

0

157

1,2-Dic hloroethane

0.44

0.00

12.7

232

N,N-Dimethy lformamide

0.06

0

33.9

239

Organic tin c ompounds

0

0

16.7

240

Sty rene

0.17

0

2.5

277

Triethy lamine

0

0

0.2

300

Toluene

0.60

0.02

0

351

1,3-Butadiene

0.03

0

0

399

Benz aldehy de

0

0

0.4

414

Maleic anhy dride

0.00

0

2.1

415

Methac ry lic ac id

0.31

0

36.8

418

2-(Dimethy lamino)ethy l methac ry late

0.21

0

113.5

420

Methy l methac ry late

4.79

0

39.8

25.86

0.07

447.2

60 Subs tanc es handled

Total releas e or trans fer amount053

Ethy lbenz ene

0.00

0

4.0

080

Xy len

0.00

0

2.7

232

N,N-Dimethy lformamide

0.00

0

4.6

300

Toluene

0.00

0

5.3

420

Methy l methac ry late

0.03

3

1.1

0.04

0

17.5

Kyoto Factory

62 Subs tanc es handled

Total releas e or trans fer amount117

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Base

Kinuura Factory

Cabinet ordernumberCabinet order name

San Nopco Ltd.

0.07

0

0

068

1,2-Epox y propane (s y nony m: Propy lene ox ide)

0.21

0

0

0.33

0

0

Total releas e or trans fer amount056

Ethy lene ox ide

0.11

0

0

068

1,2-Epox y propane (s y nony m: Propy lene ox ide)

0.37

0

0

0.49

0.00

0.1

5.12

0

0.1

5.12

0

0.1

004

Total releas e or trans fer amountAc ry lic ac id and its water-s oluble s alts
Total releas e or trans fer amount2 Subs tanc es handled004

Ac ry lic ac id and its water-s oluble s alts

0.02

0

0.0

008

Methy l ac ry late

0.02

0

0

053

Ethy lbenz ene

0.00

0

0.6

080

Xy len

0.00

0

0.4

232

N,N-Dimethy lformamide

0.00

0

2.8

298

Toly lene diis oc y anate

0

0

0.2

300

Toluene

0.09

0

4.2

407

Poly (ox y ethy lene) alk yl ether (limited to thos e the alk y l group is
C=12-15 and mix ture thereof)

0

0

0.3

409

Sodium poly (ox y ethy lene) dodec y l ether s ulfate

0

0

0.1

0.15

0

8.9

40 Subs tanc es handled

San-Petrochemicals
Co., Ltd.

Transfer towaste

Ethy lene ox ide

28 Subs tanc es handled

SDP Global Co,.
Ltd.

Release to
water

056

7 Subs tanc es handled

San Chemical Co.,Ltd.

Releaseto airTotal releas e or trans fer amount190

Dic y c lopentadiene

0.04

0

0.0

337

4-Viny l-1-c y c lohex ene

0.09

0

0.3

351

1,3-Butadiene

0.04

0

0

400

Benz ene

0.06

0

0.0

0.23

0

0.4

6 Subs tanc es handled

Total releas e or trans fer amountDioxins(unit: mgTEQ)
Base

Cabinet order number

Cabinet order name

Release to air

Release to waterTransfer to waste

Nagoya Factory

243

Diox ins

29.12

5.56

66.74

Kyoto Factory

243

Diox ins

2.00

0.13

1.66

118

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Major emission of substances subject to PRTR Law (domestic)
classification

Substance name(unit: tons)
2001

2018

2019

2020

2021

2022

Ethy lene ox ide

17.9

0.2

0.5

0.5

0.3

0.3

Propy lene ox ide

56.2

4.5

3.7

3.3

3.4

2.3

Ac ry lic ac id

4.9

11.3

11.3

10.4

5.0

6.1

Ac ry lonitrile

13.0

0.1

0.1

0.1

0.1

0.0

Sty rene

1.6

0.2

0.2

0.2

0.2

0.2

1,3-Butadiene

3.2

0.2

0.1

0.1

0.1

0.1

Methy l methac ry late

19.3

5.0

10.1

4.5

4.8

4.8

Epic hlorohy drin

1.0

1.7

1.6

1.4

1.4

1.4

Chloromethane

9.2

14.4

13.6

17.8

17.2

15.1

1,2-D ic hloroethane

4.3

0.3

0.3

0.6

0.4

0.4

1,2-Dic hloropropane

3.0

1.1

1.1

0.8

1.0

0.9

Ethy lbenz ene

3.8

1.2

1.2

1.1

1.2

1.2

Xy lene

4.6

0.7

0.7

0.6

0.7

0.7

N,N-Dimethy lformamide

2.6

0.3

0.3

0.2

0.2

0.2

Toluene

30.2

0.8

0.8

0.7

8.6

5.6

Alkylene oxides

Vinyl monomers

Chlorine compounds

Organic solvents

119

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

VOC reduction measures and results
Implementation(FY)

Facility(unit: tons)
Measures

Result(reduction volume per year)

2001

NagoyaFactory

Improv ement of propy lene ox ide ac c eptanc e s y s tem-50 tons of propy lene ox ide emis s ions to the air

2001-2005

SPCC
Kashima

Produc tion proc edure improv ement-1.4 tons of butadiene emis s ions to the air

2001-2005

NagoyaFactory
Kashima
Factory

Reduc tion of c hlorinated s olv ents (produc tion proc edurec hange, replac ement, abolition, etc .)-7 tons of mainly 1,2-dic hloroethane emissions to theair

2002-2004

Kyoto
Factory

Produc tion proc edure improv ement and emis s ions c oolingdev ic e ins tallations-9 tons of methy l methac ry late emis s ions to the air

2002

NagoyaFactory

Replac ement with other s ubs tanc e and/or abolition-0.6 tons of water s oluble hy drogen fluoride emissions
to water

2003

NagoyaFactory

VOC proc es s ing dev ic e ins tallations-25 tons of mainly ac ry lonitrile emis s ions to the air

2004

SCC
Kawasak i

Propy lene ox ide emis s ions c ombus tion dev ic e Ins tallations-6 tons of propy lene ox ide emis s ions to the air

2005

Kashima
Factory

Produc tion proc edure improv ement-3 tons of methy l methac ry late emis s ions to the air

2005

NagoyaFactory

VOC proc es s ing dev ic e ins tallations-17 tons of mainly toluene emis s ions to the air

2005

NagoyaFactory

Ethy lene ox ide emis s ions proc es s ing dev ic e ins tallations-20 tons of ethy lene ox ide emis s ions to the air

2005

SDP
Ogaki

Cy c lohex ane abs orption/c ollec tion dev ic e ins tallations-300 tons of c y c lohex ane emis s ions to the air

2006

Kashima
Factory

Enhanc ement of the c ooling s y s tems

-4 tons of methy l methac ry late emis s ions to the air

2007

NagoyaFactory

VOC abs orption/c ollec tion dev ic e ins tallations-5 tons of mainly 1,2-dic hloropropane emissions to the
air

2007

Kyoto
Factory

VOC abs orption/c ollec tion dev ic e ins tallations-12 tons of ethy l ac etate emis s ions to the air

2008

NagoyaFactory

Enhanc ement of the c ooling s y s tems

-12 tons of hex ane and methy lethy l k etone emissions
to the air

2009

NagoyaFactory

VOC abs orption/c ollec tion dev ic e ins tallations-45 tons of hex ane and methy lethy l k etone emissions
to the air

2010

Kyoto
Factory

VOC proc es s ing dev ic e ins tallations-4 tons of methy l methac ry late emis s ions to the air

2012

KinuuraFactory

Propy lene ox ide emis s ions c ombus tion dev ic e ins tallations-8 tons of propy lene ox ide emis s ions to the air

2012

SCC
Kawasak i

Propy lene ox ide emis s ion c ombus tion dev ic e ins tallations-1.5 tons of propy lene ox ide emis s ions to the air

2015

Kashima
Factory

VOC proc es s ing dev ic e ins tallations-150 tons of ethy l ac etate and -18 tons of methyl
methac ry late emis s ions to the air

2018

SDP
Ogaki

Fac tory c los ure-14 tons of c y c lohex ane emis s ions to the air

120

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Implementation(FY)

Facility

Measures

Result(reduction volume per year)

2020

NagoyaFactory

Produc tion proc edure improv ement, etc .

-0.7 tons of propy lene ox ide emis s ions to the air

2020

SKN
Nantong

VOC c ombus tion/abs orption/c ollec tion dev ic e ins tallations-9.4 tons of mainly 1,2-dic hloropropane and ethyl
ac etate emis s ions to the air

2022

NagoyaFactory
Kashima
Factory

Produc tion proc edure improv ement-9 tons of c hloromethane emis s ions to the air

Note: SPCC Kashima ; San-Petrochemical Co,. Ltd. Kashama Factory
SCC Kawasaki ; San Chemical Co,. Ltd. Kawasaki Factory
SDP Ogaki ; SDP Global Co,. Ltd. Ogaki Factory
SKN Nantong ; Sanyo Kasei (Nantong) Co., Ltd.

121

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Site report
Sanyo Chemical domestic facilities

Nagoya Factory
Location

INPUT

31-1, Shinpomac hi, Tok ai, Aic hi 476-0005,
J apanMain products

Thermoplas tic poly urethane beads for theinterior parts of automobiles (TUB),
poly urethane c hemic als , bas e materials forelec tronic materials and s urfac tants , s pec ialty
produc ts , etc .

EstablishedEs tablis hed: 1968

Site area

Area: approx . 100,000 m 2

ISO certification

ISO 9001: c ertific ated in 1998

Employees

253 employ ees (at the end of Marc h, 2023)

EnergyEnergyc ons umption in c rude oil
equiv alent

21,908kL

Rawmaterial

Purc has ed raw materials andc ontainers

133,796

tons

2,290

thousandm3

Drink ing water

33

thousandm3

Indus trial water

2,257

thousandm3

Water intak e v olume
Water
res ourc e

The Nagoya Factory has our largest production capacity and is located in a coastal

OUTPUT

industrial zone in South Nagoya. SAN NOPCO LIMITED and SDP Global Co., Ltd., Sanyo
Globalenv ironment

Chemical subsidiaries, are also located on the site.

Air quality

Env ironment

Water
quality

Was teSoil c ondition

122

GHG (CO 2
equiv alent)

46,973

tons

NOx

66.2

tons

SOx

0.5

tons

Soot and dus t

2.5

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

9.3

tons

VOC
emis s ionsv olume

17.5

tons

Fluoroc arbons(CO 2
equiv alent)

247

tons

Aqueousdis c harge

1,854

thousand
m3

COD

10.9

tons

Total nitrogen

1.4

tons

Total
phos phorus

0.3

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.2

tons

Outs ourc ed
was tetreatment

2,997

tons

Ex ternal
rec y c ling

2,997

tons

Ex ternal
landfill0

tons

Was teplas tic s

455

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

40.2

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Kinuura Factory
Location

4-43, Nitto-c ho, Handa, Aic hi 475-0033, J apan

Main products

Raw materials for poly urethane foams

EstablishedEs tablis hed: 2010

INPUT

2

Site area

Area: approx . 140,000 m

ISO certification

ISO 9001: c ertific ated in 2010

Employees

19 employ ees (at the end of Marc h, 2023)

EnergyEnergyc ons umption in c rude oil
equiv alent

1,298

kL

Raw
material

Purc has ed raw materials andc ontainers

41,397tons

Water
res ourc e

The Kinuura Factory was built for producing alkylene oxide adducts (AOAs, raw materials

Water intak e v olume

39

thousandm3

Drink ing water

1

thousandm3

Indus trial water

38

thousand
m3

2,296

tons

NOx

0.4

tons

SOx

0.0

tons

Soot and dus t

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.3

tons

VOC
emis s ionsv olume0.3

tons

Fluoroc arbons(CO 2
equiv alent)

0

tons

Aqueousdis c harge

1

thousandm3

for polyurethane foams, etc.) as the third domestic base, following Nagoya Factory and San
Chemical Co., Ltd.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teGHG (CO 2
equiv alent)

COD

0.0

tons

Total nitrogen

0.0

tons

Total
phos phorus

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.0

tons

Outs ourc ed
was tetreatment

264

tons

Ex ternal
rec y c ling

264

tons

Ex ternal
landfill0

tons

Was teplas tic s

0

tons

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

123

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Kashima Factory
Location

Main products

Poly es ter beads (PEBs ) us ed as a c ore
c omponent of poly meriz ation toners , toner
res ins , lubric ant additiv es , long-las tingantis tatic agents , etc .

Established

Operation Date: 1976

Site area

Area: approx . 130,000 m 2

ISO certification

ISO 9001: c ertific ated in 1997

Employees

INPUT

11-1, Sunay ama, Kamis u, Ibarak i 314-0255,
J apanEnergyEnergyc ons umption in c rude oil
equiv alent

17,942kL

Rawmaterial

Purc has ed raw materials andc ontainers

55,509tons

Water
res ourc e

Water intak e v olume702

thousandm3

Drink ing water

26

thousandm3

Indus trial water

675

thousandm3

175 employ ees (at the end of Marc h, 2023)

The Kashima Factory located in Ibaraki Prefecture was established in 1976 to use as
Sanyo Chemical’s principal production and distribution facility in the Kanto area.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teGHG (CO 2
equiv alent)

26,769

tons

NOx

0.2

tons

SOx

0.0

tons

Soot and dus t

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

25.9

tons

VOC
emis s ionsv olume

39.5

tons

Fluoroc arbons(CO 2
equiv alent)

31

tons

Aqueousdis c harge

807

thousand
m3

COD

127

tons

Total nitrogen

1.9

tons

Total
phos phorus

0.6

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.1

tons

Outs ourc ed
was tetreatment

5,885

tons

Ex ternal
rec y c ling

868

tons

Ex ternal
landfill1

tons

Was teplas tic s

457

tons

447.3

tons

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

124

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Kyoto Factory
Location

INPUT

11-721, Honmac hi, Higas hiy ama-k u, Ky oto
605-0981, J apan

Main products

lubric ant additiv es , c oating-adhes iv e agentsand s urfac tants

Established

Operation Date: 1949

Site area

Area: approx . 26,000 m 2 (inc luding Head offic e
and laboratory )ISO certification

ISO 9001 : c ertific ated in 1999

Employees

87 employ ees (at the end of Marc h, 2023)

EnergyEnergyc ons umption in c rude oil
equiv alent

4,065

kL

Raw
material

Purc has ed raw materials andc ontainers

22,473tons

Water
res ourc e

Water intak e v olume

184

thousandm3

Drink ing water

41

thousandm3

Indus trial water

143

thousand
m3

6,786

tons

NOx

1.8

tons

SOx

0.1

tons

Soot and dus t

0.2

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.0

tons

VOC
emis s ionsv olume

0.1

tons

6

tons

The Kyoto Factory is Sanyo Chemical’s first production facility. The Kyoto Factory, Head
Office, and Research Laboratory are located on a 260,000 m2 site.
OUTPUT
Globalenv ironment

Air quality

GHG (CO 2
equiv alent)

Fluoroc arbons(CO 2
equiv alent)

Env ironment

Water
quality

Was teAqueousdis c harge

128

thousand
m3

COD

1.2

tons

Total nitrogen

0.4

tons

Total
phos phorus

0.1

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.0

tons

Outs ourc ed
was tetreatment

3,490

tons

Ex ternal
rec y c ling

66

tons

Ex ternal
landfill0

tons

Was teplas tic s

38

tons

17.5

tons

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

125

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Head Office, Research Laboratory and Katsura Research Laboratory

Location

INPUT

Res earc h Laboratory ; 11-1, Ik k y o Nomotoc ho, Higas hiy ama-k u, Ky oto 605-0995, J apan
Kats ura Res earc h Laboratory ; 1-40, Gory o
Ohara, Nis hik y o-k u, Ky oto 615-8245, J apan

Business Locations

Sany o Chemic al Headquarter, laboratory,
Kats ura laboratory, SAN NOPCO LIMITED,
San-Apro Ltd., and SDP Global Co., Ltd.

Employees

518 employ ees in Head Offic e and Res earc hLaboratory
122 employ ees in Kats ura Res earc hLaboratory (at the end of Marc h 2023)

EnergyWater
res ourc e

Energyc ons umption in c rude oil
equiv alent

1,677

kL

Water intak e v olume

15

thousandm3

Drink ing water

15

thousandm3

Indus trial water0

thousand
m3

2,136

tons

NOx

0

tons

SOx

0

tons

Soot and dus t

0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.00

tons

VOC
emis s ionsv olume

0.05

tons

Fluoroc arbons(CO 2
equiv alent)

3

tons

Aqueousdis c harge

15

thousand
m3

COD

0

tons

Total nitrogen

0

tons

Total
phos phorus

0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0tons

Outs ourc ed
was tetreatment

163

tons

Ex ternal
rec y c ling

131

tons

Ex ternal
landfill0

tons

Was teplas tic s

7

tons

2.7

tons

These facilities located in Kyoto are our R&D base. The research departments of SDP
Global Co., Ltd. and San-Apro Ltd. are also located together in these facilities.
OUTPUT
Globalenv ironment

Head Office, Research Laboratory

Katsura Research Laboratory

Air quality

Env ironment

Water
quality

Was teGHG (CO 2
equiv alent)

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

126

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Domestic SUBSIDIARIES & AFFILIATESSDP Global Co., Ltd.
Location

INPUT

31-1, Shinpomac hi, Tok ai, Aic hi 476-0005,
J apanMain productsLine of bus ines s : Manufac ture and s ales ofs uperabs orbent poly mers

Established2001

ISO certification

ISO 9001: c ertific ated in 2000

Employees

Employ ees : 18 pers ons (at the end of Marc h,
2023)

EnergyEnergyc ons umption in c rude oil
equiv alent

18,524Rawmaterial

Purc has ed raw
materials andc ontainers

Combined with Sanyo
Chemic al Nagoya Factory
126

thousand m 3

Drink ing water

1

thousand m 3

Indus trial water126

thousand m 3

Water intak e v olume
Water
res ourc e

kL

SDP Global Co., Ltd.’s Nagoya Factory specializes in superabsorbent polymers.
The SDP Group’s Nagoya Factory consists of SDP Global Co., Ltd. in Japan, San-Dia
Polymers (Nantong) Co., Ltd. in China and SDP GLOBAL (MALAYSIA) SDN.BHD. in

OUTPUT

Malaysia.
Globalenv ironment

Air quality

GHG (CO 2
equiv alent)

36,899

tons

NOx

14.7

tons

SOx

0.0

tons

Soot and dus t

1.6

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

5.1

tons

VOC
emis s ionsv olume5.1

tons

Fluoroc arbons(CO 2
equiv alent)

31

tons

Aqueousdis c harge
COD
Env ironment

Water
quality

Was teTotal nitrogen
Total
phos phorus
Subs tanc es
s ubjec t to the
PRTR Ac t

0tons

Outs ourc ed
was tetreatment

619

tons

Ex ternal
rec y c ling

619

tons

Ex ternal
landfill0

tons

Was teplas tic s

9

tons

0.1

tons

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

127

Combined with
Sanyo Chemical
Nagoya Factory

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

SAN NOPCO LIMITED
URL

https ://www.s annopc o.c o.jp/eng/

Location

31-1, Shinpomac hi, Tok ai, Aic hi 476-0005,
J apanMain productsLine of bus ines s : Manufac ture and s ales ofindus trial agents for pulp & paper, paints ,latex , c eramic s , and elec tronic s

Established1966

ISO certification

ISO 9001: c ertific ated in 2000

Employees

83 employ ees (at the end of Marc h, 2023)

INPUT

EnergyEnergyc ons umption in c rude oil
equiv alent

1,791

kL

Raw
material

Purc has ed raw materials andc ontainers

17,343tons

Water
res ourc e

Water intak e v olume

83

thousandm3

Drink ing water2

thousandm3

Indus trial water81

thousand
m3

4,186

tons

NOx

0

tons

SOx

0

tons

Soot and dus t

0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.2

tons

VOC
emis s ionsv olume

1.8

tons

Fluoroc arbons(CO 2
equiv alent)

12

tons

Aqueousdis c harge

70

thousand
m3

COD

0

tons

Total nitrogen

0

tons

Total
phos phorus

0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0tons

Outs ourc ed
was tetreatment

55

tons

Ex ternal
rec y c ling

14

tons

Ex ternal
landfill0

tons

Was teplas tic s

22

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

8.9

tons

In 1966, it was established as a joint venture between Nopco Chemical Company of theUnited States and Sanyo Chemical Industries, Ltd. of Japan. At present, it is a wholly
owned subsidiary of Sanyo Chemical.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teSoil c ondition

128

GHG (CO 2
equiv alent)

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

San Chemical Co., Ltd.
URL

http://www.s an-c hemic al.c om/

Location

13-2, Chidori-c ho, Kawas ak i, Kanagawa,J apanMain productsLine of bus ines s : Manufac ture of raw materials
for poly urethane foams and poly ethy lene
gly c ols

Established1982

ISO certification

ISO 9001: c ertific ated in 2000

Employees

Employ ees : 39 pers ons (at the end of Marc h,
2023)

INPUT

EnergyEnergyc ons umption in c rude oil
equiv alent

3,089

kL

Raw
material

Purc has ed raw materials andc ontainers

71,708tons

Water
res ourc e

Water intak e v olume142

thousandm3

Drink ing water

15

thousandm3

Indus trial water

127

thousand
m3

6,021

tons

NOx

0

tons

SOx

0

tons

Soot and dus t

0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.5

tons

VOC
emis s ionsv olume1.1

tons

Fluoroc arbons(CO 2
equiv alent)

10

tons

Aqueousdis c harge

116

thousand
m3

COD

2.9

tons

Total nitrogen

0.3

tons

Total
phos phorus

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.0

tons

Outs ourc ed
was tetreatment

1,013

tons

Ex ternal
rec y c ling

972

tons

Ex ternal
landfill1

tons

Was teplas tic s

15

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.1

tons

Jointly established with Nippon Oil Corporation (now ENEOS Corporation) in 1982. As a
specialized manufacturer of raw materials for polyurethane foam, polyethylene glycol, etc.,

OUTPUT

Sanyo Chemical Industries, Ltd. took over the Kawasaki Plant, which started operation in
Globalenv ironment

1960.

Air quality

Env ironment

Water
quality

Was teSoil c ondition

129

GHG (CO 2
equiv alent)

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

San-Petrochemicals Co., Ltd.
URL

https ://www.s an-petroc hemic als .c om/en/

Location

11-2, Sunay ama, Kas hima, Ibarak i, J apan

Main productsLine of bus ines s : Manufac ture of EPDM rubbermaterials [e.g., Ethy lidene Norbornene (ENB)]

Established

1977

Employees

38 employ ees (at the end of Marc h, 2023)

INPUT

EnergyEnergyc ons umption in c rude oil
equiv alent

7,503

kL

Raw
material

Purc has ed raw materials andc ontainers

20,599tons

Water
res ourc eThis is a joint venture of Sanyo Chemical and ENEOS corporation (equity ratio: 50:50), andis the world's leading manufacturer of ENB.

Water intak e v olume

68

thousandm3

Drink ing water3

thousandm3

Indus trial water

66

thousandm3

13,480

tons

NOx

5.5

tons

SOx

0.1

tons

Soot and dus t

0.3

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.2

tons

VOC
emis s ionsv olume0.2

tons

Fluoroc arbons(CO 2
equiv alent)

0

tons

Aqueousdis c harge

32

thousand
m3

COD

0.4

tons

Total nitrogen

0.0

tons

Total
phos phorus

0.0

tons

Subs tanc es
s ubjec t to the
PRTR Ac t

0.0

tons

Outs ourc ed
was tetreatment

52

tons

Ex ternal
rec y c ling

51

tons

Ex ternal
landfill0

tons

Was teplas tic s

6

tons

0.4

tons

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teGHG (CO 2
equiv alent)

Subs tanc es
s ubjec t to the
PRTR Ac t
Soil c ondition

130

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

San-Apro Ltd.
URL

https ://www.s an-apro.c o.jp/eng/

LocationLaboratory : 1-40, Gory o Ohara, Nis hik y o-k u,
Ky oto 615-8245, J apan
Sales offic e: Tok y o, Os ak aLine of business

Manufac ture and s ales of DBU and DBN s uperbas e c ompounds , urethane c ataly s ts , c uring
ac c elerators for epox y res ins , photo-ac id
generators , water s oluble rus t inhibitors , etc .

Established1966

ISO certification

ISO 9001: c ertific ated in 2003

Employees

33 employ ees (at the end of Marc h, 2023)

San-Apro conducts R&D and sells products specializing in catalysts. As a fablesscompany, it does not have an in-house production facility but commissions manufacturing
to other companies, including Sanyo Chemical.
The company was established in 1966 as a joint venture with Abbott (a U.S. company).
Later, in 1986, the partner company changed to Air Products (a U.S. company), and thecompany name was changed to “San-Apro.” In 2017, Evonik (a German company) took
over the business of Air Products. At present, San-Apro is a joint venture of Sanyo
Chemical and Evonik (equity ratio: 50:50).

Sanyo Chemical Logistics Co.,Ltd.

Location

Head Offic e :31-1, Shinpomac hi, Tok ai, Aic hi,
J apanBus ines s offic e：Ky oto, Nagoy a, Kas hima,
and Kawas ak i

Sanyo Chemical Logistics was established in 2020 through the merger of Nagoya Sanyo
Warehouse Co., Ltd., which undertook storage and shipping of products and cargo handlingon the premises, and Sanyo Transport Co., Ltd., which mainly undertook the transportationof Sanyo Chemical products. The company aims to increase operational efficiency, reducetransportation costs, and improve overall logistics services by centralizing functions relatedLine of business

Warehous ing, forwarding, c argo work in thefac tories and truc k ing of Sany o Chemic alGroup produc ts

Established2020

to the supply chain.

Shiohama Chemicals Warehouse Co., Ltd.
Location

2-2-6, Yak o, Kawas ak i, Kanagawa, J apan

Line of business

Warehous ing for haz ardous goods

Established

1983

This is a joint venture of Sanyo Chemical and ENEOS corporation (equity ratio: 50:50).
This warehouse company located near San Chemical Co., Ltd. handles San Chemical
products.

131

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Overseas affiliates/subsidiaries

San-Dia Polymers (Nantong) Co., Ltd.
INPUT

Location

Nantong, China

Line of business

Manufac ture and s ales of s uperabs orbent
poly mers

EnergyEnergyc ons umption in c rude oil
equiv alent

23,749kL

Established

2003

Raw
material

Purc has ed raw materials andc ontainers

110,315

tons

ISO

ISO 9001：c ertific ated in 2007
ISO 14001：c ertific ated in 2013

Employees

174 pers ons (at the end of Marc h, 2023)

Water
res ourc eThis is a Chinese subsidiary of SDP Global Co., Ltd. which is a specialized manufacturer of

Water intak e v olume279

thousandm3

Drink ing water

68

thousandm3

Indus trial water

211

thousandm3

superabsorbent polymers.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teSoil c ondition132

GHG (CO 2
equiv alent)

62,296

tons

NOx

14.1

tons

SOx

3.7

tons

Soot and
dus t

1.6

tons

VOC
emis s ionsv olume2.2

tons

Aqueousdis c harge

37

thousand
m3

COD

2.8

tons

Total
nitrogen

0.2

tons

Total
phos phorus

0.0

tons

Outs ourc ed
was tetreatment

938

tons

Ex ternal
rec y c ling

513

tons

Ex ternal
landfill0

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

SDP GLOBAL (MALAYSIA) SDN. BHD.
INPUT

Location

J ohor, Maly s ia

Line of business

Manufac ture and s ales of s uperabs orbent
poly mers

EnergyEnergyc ons umption in c rude oil
equiv alent

15,132kL

Established

2015

Raw
material

Purc has ed raw materials andc ontainers

69,447

tons

Employees

78 pers ons (at the end of Marc h, 2023)

Water
res ourc eThis is a production site in Southeast Asia for SDP Global Co., Ltd., a specialized
manufacturer of superabsorbent polymers, which began operations in FY2018.

Water intak e v olume

170

thousandm3

Drink ing water

170

thousandm3

Indus trial water0

thousandm3

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teSoil c ondition133

GHG (CO 2
equiv alent)

30,974

tons

NOx

0.5

tons

SOx

0.4

tons

Soot and
dus t

0.3

tons

VOC
emis s ionsv olume0.0

tons

Aqueousdis c harge

14

thousand
m3

COD

0.7

tons

Total
nitrogen

0

tons

Total
phos phorus

0

tons

Outs ourc ed
was tetreatment

1,240

tons

Ex ternal
rec y c ling

859

tons

Ex ternal
landfill0

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Kasei (Thailand) Ltd.
URL

Location

INPUT

https ://www.s any o-k as ei.c o.th/EN/home.html

Head Offic e : Bangk ok , Thailand
Fac tory : Ray ong Fac tory

Line of business

Manufac ture and s ales of tex tile c hemic als ,s urfac tants , papermak ing c hemic als , paint &ink res ins , etc .

Established

1997

ISO certification

ISO 9001：c ertific ated in 2004
ISO 14001：c ertific ated in 2009

Employees

91 pers ons (at the end of Marc h, 2023)

EnergyEnergyc ons umption in c rude oil
equiv alent

2,502

kL

Raw
material

Purc has ed raw materials andc ontainers

6,417

tons

209

thousandm3

Drink ing water0

thousandm3

Indus trial water

209

thousandm3

Water intak e v olume
Water
res ourc eThis operates as our base of operations in the ASEAN region.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teSoil c ondition134

GHG (CO 2
equiv alent)

5,474

tons

NOx

0.2

tons

SOx

0.1

tons

Soot and
dus t

0.0

tons

VOC
emis s ionsv olume

5.0

tons

Aqueousdis c harge

197

thousand
m3

COD

24

tons

Total
nitrogen

1.1

tons

Total
phos phorus

0.0

tons

Outs ourc ed
was tetreatment

2,631

tons

Ex ternal
rec y c ling

255

tons

Ex ternal
landfill0

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Kasei (Nantong) Co., Ltd.
Location

Nantong, China

Line of business

Manufac ture of tex tile c hemic als , s urfac tants ,papermak ing c hemic als , paint & ink res ins ,etc .

Established2003

ISO certification

ISO 9001：c ertific ated in 2006
ISO 14001：c ertific ated in 2012

Employees

98 pers ons (at the end of Marc h, 2023)

INPUT

EnergyEnergyc ons umption in c rude oil
equiv alent

3,205

kL

Raw
material

Purc has ed raw materials andc ontainers

10,863tons

Water
res ourc e

Water intak e v olume

24

thousandm3

Drink ing water

24

thousandm3

Indus trial water0

thousandm3This operates as our production base in China.

OUTPUT
Globalenv ironment

Air quality

Env ironment

Water
quality

Was teSoil c ondition135

GHG (CO 2
equiv alent)

9,545

tons

NOx

0

tons

SOx

0

tons

Soot and
dus t

0

tons

VOC
emis s ionsv olume0.8

tons

Aqueousdis c harge

25

thousand
m3

COD

1.1

tons

Total
nitrogen

0.0

tons

Total
phos phorus

0.0

tons

Outs ourc ed
was tetreatment

3,706

tons

Ex ternal
rec y c ling

2,838

tons

Ex ternal
landfill0

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sanyo Chemical Texas Industries, LLC
INPUT

Location

Tex as , USA

Line of business

Manufac ture of thermoplas tic poly urethane
beads

EnergyEnergyc ons umption in c rude oil
equiv alent

Established

2005

Raw
material

Purc has ed raw materials andc ontainers

Employees

13 pers ons (at the end of Marc h, 2023)

Water
res ourc eThis is a production base for thermoplastic polyurethane beads for the interior parts ofautomobiles in the United States.

405

kL

1,108

tons

Water intak e v olume

0.4

thousandm3

Drink ing water

0.1

thousandm3

Indus trial water

0.3

thousand
m3

742

tons

NOx

0

tons

SOx

0

tons

Soot and dus t

0

tons

OUTPUT
Globalenv ironment

Air quality

GHG (CO 2
equiv alent)Aqueousdis c harge

Env ironment

Water
quality

Was teSoil c ondition

136

0.6

thousand
m3

COD

0

tons

Total nitrogen

0

tons

Total
phos phorus

0

tons

Outs ourc ed
was tetreatment

47

tons

Ex ternal
rec y c ling

43

tons

Ex ternal
landfill4

tons

No emissions

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

ESG Performance Data

Social社会

Environment

Governance

Employee-related data
Employment (domestic)unit

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

1,272

1,267

1,278

1,281

1,237

276

283

300

319

323

41

34

25

30

16

11

10

8

15

5

15

7

10

6

7

3

4

6

3

4

%

18

18

19

20

21

pers ons

6

9

13

15

16

%

2.0

3.0

4.0

4.6

4.6

Annual holidays

day s

127

129

129

126

127

Annual workdays

day s

238

236

237

239

238

Annual regular working hours

hours

1,845

1,829

1,837

1,852

1,845

Monthly average overtime work

hours

6.7

4.8

4.4

4.8

5.2

Paid leave usage ratio

%

58.1

55.7

58.5

50.6

70.2

Average years of service

y ears

15.6

15.8

15.9

16.5

17.0

pers ons

3

5

5

5

5

%

5.9

8.6

9.6

6.8

9.1

pers ons

26

26

26

26

27

Ratio of employees with disabilities

%

2.18

2.18

2.17

2.09

2.23

Re-employment of mandatory retirees

pers ons

24

27

14

20

20

%

80

87

81

87

100

pers ons

18

17

12

13

25

Male
Employees

pers ons
FemaleMale

New employees

pers ons
FemaleMale

Mid-career recruits

pers ons
FemalePercentage of females
persons
Female managers
per all managers

Turnover up to three years after joining the company

Employees with disabilities

Re-employment rate of fixed-term retirees
Non-Japanese employees

137

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

unit
Employees on maternity leavepers ons
Male

Employees on childcare leave

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

13

18

14

12

17

27

37

40

47

55

14

13

17

11

17

pers ons
FemalePercentage of male employees taking childcare leave

%

48.2

77.1

66.7

79.7

98.2

Employees return rate from childcare leave

%

100

100

100

100

100

1

0

0

0

0

50

16

12

4

6

Male
Employees on short working hours for childcare

pers ons
FemaleEmployees on family care leavepers ons

0

1

1

1

1

Employees on reduced working hours for family carepers ons

1

1

0

0

0

Percentage of male employees taking childcare leave (As of March 31, 2023)

138

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Number of employees and average age

Education and training (domestic)(unit: persons)
FY

2018

2019

2020

2021

2022

Study abroad

2

1

0

0

1

Overseas training

1

4

0

0

0

Expatriate development program

3

5

2

1

1

Personal research challenge

1

0

0

0

0

Challenge contract

5

0

0

0

0

Employees (including transfers)

239

210

93

168

96

Subcontract employees

33

71

12

35

20

313

394

19

55

47

Participants
Safety, Technology, and Education Center
Visitors/guests

Occupational accidents (domestic + overseas)
FY
Lost-work injuries (Sanyo Chemical Group)(cases)

2018

2019

2020

2021

2022

2

0

0

6

1

0

0

0

0

0

Lost-work injuries frequency (Sanyo Chemical Group)*1

0.56

0

0

1.61

0.27

Lost-work injuries severity (Sanyo Chemical Group)*2

0.00

0

0

0.05

0.05

Lost-work injuries (subcontractors)(cases)

0

2

2

2

3

Wherein, fatalities occurred(cases)

0

0

0

1

0

Lost-work injuries frequency (subcontractors)*1

0

2.28

1.94

1.69

2.37

Lost-work injuries severity (subcontractors)*2

0

0.09

0.04

6.33

0.13

Employees lost time (cases)

4

4

2

2

7

Partner company employee lost time (cases)

6

1

5

4

5

Wherein, fatalities occurred(cases)*1 Frequency rate = (Number of employees subject to accident with lost time) ÷ (total working hours) × 1,000,000
This value indicates the frequency of accident victims (Group company employees) per 1 million hours*2 Severity rate = (labor lost days) ÷ (total working hours) × 1,000
This value indicates the severity of accidents per 1,000 working hours

139

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Health productivity management related data (domestic)
Action goals for the five initiatives
Initiative(unit: %)Item

FY 2019

FY 2020

FY 2021

FY 2025(Target value)

FY 2022

Exercise

To have an ex erc is e routine at leas t onc e a
week

29

31

50

50

70

Sleep

To be well res ted with s leep

54

57

66

63

80

Diet

To have a balanc ed diet

－

－

76

75

90

Alcohol

To have two or more alc ohol-free day s per week

74

75

75

76

90

Smoking

Not to smoke (Smok ing rate reduc tion)

77

77

82

83

90

Note: This survey is based on a questionnaire concerning lifestyle diseases conducted at regular medical checkups.

Checkups and guidance
FY(unit: %)
2019

2020

2021

2025
(Target value)

2022

Rate of regular health checkups

100

100

100

100

100

Rate of medical checkups

43

68

89

96

100

Rate of specific health guidance

14

80

94

94 or more

100

Lifestyle-related disease risk retention rate (health checkup results)
FY

2019

(unit: %)

2020

2021

2025
(Target value)2022

Obesity

24

26

25

25

20 or lessLiver function

30

34

31

34

30 or less

Fats

51

57

55

56

50 or less

Blood sugar

24

17

21

17

15 or less

Blood pressure

31

37

34

29

30 or less

Triple risk holders (fats, blood sugar,
blood pressure)

8

8

8

5

5 or less

Mental health measures
FY

2019

2020

2021

2022

Stress check inspection rate (%)

99

99

98

99

Stress check high stress rate (%)

9.3

8.9

8.6

7.1

140

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Health Management Evaluation Indexes
FY

2019

2020

2021

2025
(Target value)2022

Absenteeism*1
Personal injury/sickness absence
rate (%)

1.5

1.5

1.8

1.9

1.0 or lessPresenteeism*2
Labor productivity loss rate (%)

－

－

37.5

36.6

30 or lessWork engagement*3
Self-motivated behavior and positive
feelings toward work (deviation
value)

－

－

49.7

50.1

51 or more

*1 A condition in which the employee cannot perform duties due to absence from work, leave of absence, or other reasons. Measured by the number of employees on sick leave who are absent for more than
one month.
*2 A condition in which the employee is present at work but is not able to work sufficiently due to mental or physical health problems. Measured by the WHO Health and Labor Performance Questionnaire.
*3 A state of mind that is positive and full of accomplishment, vitality, enthusiasm, and immersion in one’s work. Measured by a proprietary survey instrument using eight items that correlate well with theUtrecht Work Engagement Scale.

Communication
IR information(unit: times)
FY

2018

2019

2020

2021

2022

Financial results announcement

2

2

2

2

2

Financial results briefing for
institutional investors

2

2

2

2

2

Financial results briefing for private
investors

2

2

0

0

0

Website information(unit: times)
FY

2018

2019

2020

2021

2022

IR information

24

25

23

23

22

Press release

25

28

35

36

37

News

28

41

66

49

42

Note: Number does not include personal changes

Exhibitions(unit: times)
FY

2018

2019

2020

2021

2022

Domestic

1

2

3

4

6

Overseas

4

5

1

2

2

141

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Shareholders composition (at the end of March, 2023)

Social contributions
Donations(unit : million yen)
FY

2018

2019

2020

2021

2022

24.0

39.9

24.2

36.4

34.9

1. Support for academic promotion mainly concerning chemistry

14.4

17.0

14.8

27.0

14.1

2. Support for human resource development

0.8

2.2

3.1

0.3

2.3

3. Support for the preservation activities of art and culture, mainly in Kyoto

1.1

1.5

0.5

1.0

4.1

4. Support for environmental conservation activities

1.1

11.0

1.6

1.6

1.5

5. Support for social contribution activities wherever possible according to local social needs andrequirements

6.6

8.1

4.2

6.5

13.0

Social contribution expenditure: Total amount

Donations by
Item

Note: Expenditures of Sanyo Chemical Industries, Ltd. until FY2019. Expenditures of SANYO CHEMICAL Foundation for Social Contribution since September 2019
(in FY2019, sum of Sanyo Chemical Industries, Ltd. and SANYO CHEMICAL Foundation for Social Contribution)

Elementary school chemistry lessons
Upper: Number of sessions (unit:times), Lower: Number of participants (unit:persons)Area

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

Instructors

8

7

4

6

6

449

390

209

446

335

2

2

0

1

2

280

235

0

73

250

3

2

0

1

4

224

198

0

50 *1

255 *2

Kyoto

R&D, and Head offic e staff

NagoyaNagoy a Fac tory staff

Kashima

Kas hima Fac tory staff*1 An estimate of the number of participants in the event*2 Includes estimated number of event participants

142

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Acceptance of foreign students(Unit: persons)
FY

2018

2019

2020

2021

2022

Acceptance of the students in the departments of science, technology, and agriculture through IAESTE*

1

1

0

0

0

International internship program between TU Dortmund University and Kyoto University

1

1

0

0

1

Other

－

－

－

1

0

*IAESTE: The International Association for the Exchange of Students for Technical Experience, which is an NGO mediating the overseas internship for the students in the departments of science, technology,
and agriculture

Forestry activities: Sanyo Chemical's Forest in the Kyoto Prefecture of Japan

Employee volunteer forestry activities
unit

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

Number of times conducted

times

3

2

2

1

3

Total number of participants

pers ons

194

87

60

34

101

Number of times conducted

times

7

8

7

4

7

Total number of participants

pers ons

34

46

63

28

63

Sanyo Chemical’s forestry activities

Supporter Association*1

FY2022 results
Date

Participants(persons)

New employee training

April 8, 2022

23

Walk ing trail improv ements

The 24th forestry activities

J une 11, 2022

27

Walk ing trail improv ements , wildlife v iewing

The 25th forestry activities

Dec ember 10,
2022

51

Tree planting, ins tallation of animal fenc ing, pine c one c rafts , Mountain Kids
ex c hange meeting *2

Supporter Association*1 in
FY2022

Total 7 times

63

Preparations for the fores try c reation ac tiv ities , walk ing trail improv ements, etc.

Activity*1 Supporter Association: Forest volunteers consisting of employees, their families, and retired employees*2 Mountain Kids: Activities to foster younger generations who will bear responsibility for forests, so that forests can be reliably passed on to the future. The Junior Green Club and Kyoto Model Forest
Association cooperate and implement these activities.

143

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
Funding provided for tree thinning project
unit

Thinned area
CO 2 absorption volume

FY 2020

FY 2021

FY 2009 - FY 2017 andfrom FY 2020

FY 2022

ha

3.5

3.7

2.4

58.6

CO 2 tons /y ear

12.6

38.5

10.6

363.3

Note: Implemented since FY2009; suspended in FY2018 and FY2019.

Rice cultivation in Futago terraced rice fields
unit

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

㎡

300

400

400

400

400

Number of times implemented

times

7

7

8

9

14

Total number of participants

pers ons

88

94

45

74

71

kg

220

230

230

240

270

Terraced rice field area

Rice harvest

144

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

ESG Performance Data

Environment

Governance
GovernanceSocialBoard members
List of Board members
unit

2018

2019

2020

2021

2022

Total number of directors

pers ons

10

10

10

9

9

Outside directors

pers ons

3

3

3

3

3

Independent directors

pers ons

3

3

3

3

3

Female directors

pers ons

1

1

1

2

2

Frequency

times

15

17

17

15

15

%

100

100

100

99.1

99.2

Total number of the Audit & Supervisory Board
members

pers ons

4

3

4

4

4

Outside A&S Board members

pers ons

3

2

3

3

3

Independent A&S Board members

pers ons

1

1

1

1

1

Female A&S Board members

pers ons

0

0

0

0

0

Frequency

times

12

12

11

12

12

%

97.9

95.8

100

100

100

Composition of the Board of Directors *1

Board of Directors Meeting*2
Average attendanceComposition of the Audit & Supervisory
Board*1

Audit & Supervisory Board Meeting*2
Average attendance*1 Number of directors and A&S Board members after the General Shareholders' Meeting in June
*2 Fiscal year from April to March

Board members’ remuneration
Classification(unit: million yen)
2018

2019

2020

2021

2022

Directors (internal)

289

304

319

308

260

Audit & Supervisory Board (internal)

32

30

27

33

32

Outside Directors

25

28

29

27

26

Outside Audit & Supervisory Board

47

44

41

49

50

Total

395

408

418

418

369

Note: There is no individual board member whose total amount of remuneration is 100 million yen or higher. Including the amounts paid to board members who resigned during the term.

145

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Committee
Committee

Chairperson

Committee members

Secretariat

ObserverFrequency(FY2022)

Nomination andCompensation
Committee(Established in
2021)

Chairmanof theBoard ofDirec tors

Fiv e board members s elec ted byres olution of the Board of Direc tors
(Majority of them are independentouts ide direc tors )

－

－

5

Full-time Direc tors

General Manager of the Corporate
Planning Div is ion and thos e appointed by
the General Manager of the Corporate
Planning Div is ion

Full-time
Audit &
Superv is ory
BoardMember2

President

Full-time Direc tors

General Manager of the Auditing Div is ion
and the General Manager of the Legal
Affairs Department

Full-time
Audit &
Superv is ory
BoardMember1

President

Thos e who are in c harge of thes ales , res earc h, produc tion, andindirec t departments

General Manager of the Auditing Div is ion

Full-time
Audit &
Superv is ory
BoardMember2

Sustainable
Management
Committee(Established in
2021)

Compliance
Committee

Internal Control
Committee

President

Compliance
Whistleblowing, disciplinary actions, and violations(unit: cases)
FY

2018

2019

2020

2021

2022

Number of cases of using the whistle-blower hotlines

1

4

1

2

4

Disciplinary actions

2

4

1

0

4

Legal violation/Administrative guidance concerning fair trade and anti-corruption

0

0

0

0

0

Legal violation/Administrative guidance concerning chemical substances and export control

0

0

0

0

0

Other Legal violation/Administrative guidance concerning compliance with laws and regulations

0

0

0

0

0

Lawsuit related to the above

0

0

0

0

0

Legal violation/Administrative guidance concerning environmental laws and regulations

0

0

0

0

0

Complaints on pollution

0

1*

0

0

0

Violations, etc.

* Noise compliant from neighborhood

Political donations（unit:yen）
FY

2018

2019

2020

2021

2022

0

0

0

0

0

Total amount of donations to political parties

146

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Policies, Standards and Guidelines

Code of Ethics andManagement

Responsible Care, Environment
and Safety

SocialGovernance

Company Mission
Establish a better society through our corporate activities.
To achieve this purpose, we will endeavor to promote the followings:
1. We believe that the company is an organic entity of capital, management, and labor harmoniously linked together. Keeping this in mind, we will strive to achieve dynamic growth.
2. Trusting that our inventive power has no limits, we will ceaselessly try to develop new business areas and supply original and high-quality products to the market.
3. We believe that perpetual profits come only from the creation of value, and we do not seek superficial profits.
4. We will fulfill the customers’ expectation and earn their trust by providing high-quality cost-effective products and superior technical service.
5. When all the members of the company share the same vision for the company’s future and challenge for innovation on our own initiative, we will be rewarded with an abundant profit.
This profit will then be fairly distributed among internal reserves, shareholders, management and employees.
6. We will strive for perfection in safety and harmony with the environment, which is the first required mission in the society.

(Established in 1959; revised on December 21, 1995)

Code of Corporate Ethics
We, Sanyo Chemical Group, are maintaining our Code of Corporate Ethics, believing that it is essential corporate behavior to ensure legal compliance and to fulfill corporate social
responsibility, which has been implemented to take the lead in the realization of a sustainable society. With good sense and integrity we are committed to improving our society and arefollowing our company mission, "Establish a better society through our corporate activities."
Based on these corporate ethics, we prescribe our principles of corporate behavior as follows:
1. We, Sanyo, shall develop and provide socially beneficial and safe products and services, through innovation, and strive for sustainable economic growth and the resolution of social
issues. And provide consumers and customers with appropriate information about products and services, communicate with them in good faith, earn the satisfaction and confidenceof our consumers and customers.
2. In our business activity, we shall be devoted to fair competition, appropriate transactions and responsible procurement.
3. We shall proactively take initiatives to conserve the environment and prevent accidents and disasters as crucial requirements for the sustainability and activity of our business.
4. We shall engage in active, effective and fair disclosure of corporate information, not only to shareholders, but also a wide range of stakeholders.
5. We shall protect our intellectual properties and respect those of others, as well as be thorough in our protection and management of personal information and customer information.
6. We shall conduct business that respects the human rights of all persons.
7. As a “good corporate citizen,” we shall actively engage in community involvement activities and contribute to community development.
8. We shall realize work practices that will improve the capability of employees and that respect their diversity, character, and individuality. Also, we shall provide a safe and healthy
working environment.
9. We shall conduct thorough and organized crisis management in the face of actions antisocial forces, terrorism, cyber attacks, natural disasters and other crises that pose a threat tocivil society and corporate activity.
All management must undertake the responsibility and take all necessary actions for implementing and promoting this Code of Corporate Ethics within Sanyo Chemical Group.
Management must promote the development and imple-mentation of systems that will contribute to the achievement of the Code of Corporate Ethics. Management must also encourage
behavior based on the principles of this Charter within the corporation’s supply chain.
In the event of any violation of these principles and loses the trust of society, top management must take responsibility to respond to the situation, including resolving the problem,
investigating the causes, and preventing the problem from recurring.

Established: April 1, 2003
The 2nd version revised: January 1, 2005
The 3rd version revised: March 26, 2008
The 4th version revised: April 1, 2011
The 5th version revised: November 1, 2018

147

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Advice on ComplianceIn the Code of Corporate Ethics we have declared that it is essential corporate behavior to ensure legal compliance and to fulfill our corporate social responsibility. We Sanyo ChemicalGroup are voluntarily adopting this advice in order to promote a sustainable society and are following our company mission, keeping in mind good sense and integrity towards thesurrounding society. All company executives and employees are expected to follow this code of corporate ethics:
Therefore, we expect all of us to answer positively to each question below.
1. Can you confirm that your judgment of compliance is not clouded by anything such as profit-making motives or budget short fall?
2. Can you confirm that your decisions have not been founded on over-optimism or wishful thinking and thus containing legal risk?
3. Can you confirm that your decisions comply with the code of corporate ethics and are in no way damaging to Sanyo Chemical Group corporate reputation?
4. Can you confirm that you have not concealed information or have not made judgments that could be considered unfair or selfishly motivated?
5. Can you confirm that you have conducted yourself in a fair and honest manner and have not engaged in illegal or legally risky actions?
6. Can you confirm that you have not been forced to do something that you suspected it was unfair or might have been illegal? Can you confirm that you have not been forced to dosomething that you suspected it was unfair or might have been illegal?
7. Can you declare openly that your actions have always been legal, just and fair?
If you are having difficulty in your decision making, please do not hesitate to discuss duly with your superiors or people concerned. If you feel necessary, you can also consult thecompliance hotlines listed below.
Hot lines

・Internal Hot line: General Manager of Audit Division (Secretary of Compliance committee)
・External Hot line: The contact information is withheld.
Established: April 1, 2003
The 2nd edition revised: January 1, 2005

CSR Guidelines

Basic Policy

Our mis s ion has been to es tablis h a better s oc iety through our c orporate ac tiv ities s inc e our foundation.
Sany o Chemic al Group aims for s us tainable growth of our own group through c orporate ac tiv ities thatc ontribute to the "realiz ation of a s us tainable global env ironment."

1.Safety and accident prevention

We will giv e top priority to s afety and ac c ident prev ention in all our bus ines s ac tiv ities . We will strive forthe c ontinuanc e of ac c ident-free and injury -free operation, and c ontribute to s oc ial s afety. At the sametime, we will protec t the s afety and health of ev ery one inv olv ed in our operations , and s triv e to create ac omfortable work env ironment.

2.ComplianceAll direc tors and employ ees of our Group mak e s ure to tak e ac tion with the ques tions in “Adv ice on
Complianc e” in mind, inc luding “Can y ou dec lare openly that y our ac tions hav e alway s been legal, just, andfair?”

3.Reduction of environmental impact

We work v oluntarily and s teadily on effec tiv e meas ures to reduc e greenhous e gas emis s ions and thegeneration of plas tic and indus trial was te. Notably, to reduc e greenhous e gas emis s ions , we actively
promote energy c ons erv ation and the s hift to renewable energy.

4.Product development

We aim to dev elop produc ts that are us eful in s oc iety and that c an “realiz e a s us tainable global
env ironment” and “improv e c onv enienc e and c omfort,” by c ombining the s trengths that we have acquiredwith new s trengths that we will ac quire and ex ternal ex pertis e.

5.Sustainable purchasing

We hav e our Sustainable Purc has ing Polic y in plac e and s teadily fulfill the polic y to c ontribute to “realizing
a s us tainable global env ironment,” and av oid c omplic ity in human rights v iolations throughout the supply
c hain, inc luding s uppliers .

6.Product safety and quality reliability

We prov ide ac c urate produc t information to ex ternal parties to ens ure s afety throughout the productlifec y c le, from dev elopment and manufac ture to us e and dis pos al of produc ts . To improv e the quality
reliability of produc ts , we ens ure rigorous quality c ontrol in-hous e.

7.DEI and human resource development

We res pec t the div ers ity, pers onalities , and indiv iduality of our employ ees , and ens ure a s afe andc omfortable workplac e env ironment. We dev elop human res ourc es who c an ac hiev e s elf-ac tualization bydemons trating s elf-initiativ e and c reativ ity in addition to realiz ing well-being, abundanc e, and mental andphy s ic al health. We endeav or to eliminate haras s ment and res pec t human rights in the work place.

8.Dialogue with stakeholders

We dis c los e financ ial and non-financ ial information of our Group in an ac tiv e and fair manner and promotedialogue s o that our s tak eholders , inc luding c us tomers , s hareholders , inv es tors , s uppliers , local
c ommunities , loc al gov ernments , mas s media, and employ ees c an c orrec tly unders tand the c orporatev alue of our Group, and s o that we c an unders tand the ex pec tations and ev aluations of our Group from thev iewpoint of our s tak eholders and reflec t them in our c orporate ac tiv ities .

9.Social contribution activities

We maintain our v oluntary ac tiv ities to c ontribute to educ ational and res earc h ins titutions , medical
ins titutions , loc al c ommunities , NPOs , and NGOs , with the aim of promoting s c ienc e and tec hnology, art,
c ulture, educ ation, and welfare.
(Established on August 31, 2009; revised on February 28, 2022)

148

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Code of Ethics andManagement

Responsible Care, Environment
and Safety

SocialGovernanceManagement policies concerning responsible care（RC）
1. We will set continuance of accident-free/injury-free operation and harmony with the global environment as priority managerial issues.
2. We will thoroughly comply with laws and regulations in every aspect of business activities and cooperate in the measures implemented by authorities and international
agreements.
3. We will put all our energy into continuous improvement of the environment and safety throughout the whole product lifecycle ranging from product development throughmanufacturing, physical distribution, use, and final consumption to disposal.
4. To reduce the environmental load, we will endeavor to reduce the emissions of greenhouse gases and save energy and resources in the product development and manufacturing
stages and will promote recycling, decrease of waste, and reduction of the emission of chemical substances.
5. We will not only provide products that can be used by customers with satisfaction and safety but also try to collect the latest information on product safety and provide customers
with the collected information.
6. We will deepen our understanding and appreciation of conservation of biodiversity and promote activities with due consideration for biodiversity. We will promote communications
concerning environmental conservation activities with the concerned authorities and local community.
7. We will promote communications concerning environmental conservation activities with the concerned authorities and local community.
(Established on November 1, 1996; revised on August 6, 1999; revised on June 2, 2005; revised on November 30, 2009; revised on May 9, 2013)

Action Policy Concerning Kyoto Protocol
As a company based in the city of Kyoto where an international agreement (Kyoto Protocol) for global warming prevention was made, we acknowledge the activity for global warming
prevention as an important managerial issue and proactively engage in the activities shown below.
1. We will design products by considering the minimization of the emissions of greenhouse gases throughout the lifecycle of our products.
2. In manufacturing and physical distribution, we will proactively incorporate the latest technologies to promote energy saving and work to reduce our dependence on fossil fuels.
3. We will instruct our employees to practice energy saving/resource saving that leads to global warming prevention in their private lives and will support those activities.
4. We will reduce the emissions of greenhouse gases through our own efforts and introduce emission reduction by means of greenhouse gas emission trading at home and abroad.
(Established on June 2, 2005; revised on June 8, 2006)

Action Policy Concerning Biodiversity
With the acknowledgement that business affects biodiversity, our group will deepen the understanding and acknowledgement of the preservation of biodiversity and promote ouractivities with consideration for biodiversity.
1. We will develop products in consideration of the environment and contribute to the preservation of biodiversity through the provision and diffusion of those products.
2. In the procurement of materials, raw materials, office supplies, and others, we will give consideration to the preservation of biodiversity.
3. We will reduce the environmental loads, such as the emissions of greenhouse gases, utilization of water resources, and release of chemical substances and waste, from theworkplaces so as to alleviate their impact on biodiversity.
4. All of our employees will enhance the understanding and acknowledgement of biodiversity and try to enhance the awareness of the preservation of biodiversity.
5. We will promote efforts in cooperation with the local community.
(Established on May 9, 2013)

Safety Philosophy and Policy
Safety philosophy
We place the highest priority on Safety and Compliance in all our business activities.

Safety policy
Safety comes first. Recognizing that safety is the foundation of our business activities, and with a strong determination to ensure that no one will be injured or will injure others, we will
work on the following as our basic policy.
1. Observance of basic safety rules
2. Execution of health and safety activities
3. Improvement of crisis management capabilities(Established on December 27, 2022)

149

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Code of Ethics andManagement

Responsible Care, Environment
and Safety

SocialGovernanceSanyo Chemical Group Human Rights Policy
1. Basic attitude
As corporate activities become increasingly globalized, companies are expected to take the initiative in eliminating human rights violations from the perspective of creating an
inclusive society. The Group will conduct management that respects the human rights of all people and recognizes that its business activities may have a negative impact onhuman rights. At the same time, we will work with our customers, business partners, suppliers, and government agencies to avoid such negative impacts, thereby gaining
recognition from investors, customers, and society at large. We will also cooperate with diverse stakeholders to support the socially vulnerable.
2. Scope of application
This policy applies to all executives and employees of the Sanyo Chemical Group. The Sanyo Chemical Group will continue to encourage its customers, business partners, andsuppliers to support this policy and participate in similar initiatives, and will work together to promote initiatives to respect human rights.
3. Responsibility to respect human rights
The Sanyo Chemical Group will fulfill its responsibility to respect human rights by not infringing on the human rights of those affected by its business activities and by taking
appropriate measures to correct any adverse impact on human rights that its business activities may cause. If any adverse impact on human rights is caused by our customers,
business partners, and suppliers, we will demand them to take appropriate action.
4. Compliance with applicable laws and regulations
The Sanyo Chemical Group will strive to understand internationally recognized human rights norms and the relevant laws and regulations in each country, including those
stipulated in the following documents. Where local national laws and regulations are incompatible with internationally recognized human rights norms, we will seek ways torespect the latter.
・International Bill of Human Rights: Universal Declaration of Human Rights and International Covenants on Human Rights (International Covenant on Civil and Political Rights /International Covenant on Economic, Social and Cultural Rights)
・International Labour Organization’s (ILO’s) Core Labour Standards (child labor, forced labor, freedom of association and the right to collective bargaining, elimination of
discrimination in employment, etc.)
・United Nations “Guiding Principles on Business and Human Rights”
・OECD Guidelines for Multinational Enterprises
・United Nations Global Compact (voluntary efforts of companies based on the Ten Principles in the areas of human rights, labor, the environment, and anti-corruption)
・IS026000 “Guidance on social responsibility”
・Japanese government “Guidelines on Respect for Human Rights in Responsible Supply Chains”
・UK Modern Slavery Act
5. Human rights due diligence
The Sanyo Chemical Group will establish a human rights due diligence system to identify adverse impacts on human rights, conduct preventive surveys and investigations,
implement appropriate measures to correct adverse impact, and continue to strive to prevent and mitigate its adverse human rights impact on society.
6. Identification of human rights risks
The Sanyo Chemical Group has identified the following three items as outstanding human rights issues, and will continue to address these issues.
・Labor in the supply chain
・Employee safety and health・Human rights risks due to the effects of geopolitical situations and conflicts
7. Prevention and mitigation measures
The Sanyo Chemical Group will not engage in discrimination or acts that undermine the dignity of individuals based on factors such as thoughts, creed, age, social status,
nationality, birthplace, ethnic group, religion, immigration, gender, sexual orientation, gender identity, pregnancy, poverty, disease, and disability. To that end, we will also
strive to understand the issues faced by socially vulnerable people who suffer from discrimination and acts that undermine personal dignity based on these reasons, andcooperate with various stakeholders such as government agencies, local governments, and social welfare organizations to provide support.
8. Corrective and remedial measures
The Sanyo Chemical Group fully recognizes that human rights violations pose a management risk. It will prevent human rights violations and respond fairly and appropriately inthe event of any human rights violations. It will not only oppose child labor and forced labor, but will also not use raw materials that are thought to have been produced by childlabor or forced labor. It will also establish a whistleblowing contact point that allows anonymous reporting for internal employees, and will take necessary measures while
appropriately handling the confidentiality of the whistleblowers and reported information. It will prohibit any disadvantageous treatment or retaliation against whistleblowers,
and will ensure their protection.
9. Education
The Sanyo Chemical Group will continue to provide appropriate education to ensure that a correct understanding of this policy is permeated both inside and outside thecompany, and that it is effectively implemented.
10. Information disclosure/engagement
The Sanyo Chemical Group will disclose the status of its efforts regarding Respect for Human Rights. It will also evolve a series of efforts based on this policy through dialogue
and consultation with various internal and external stakeholders.
(Established: March, 2023)

150

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Sustainable Procurement
1. We conduct procurement activities based on social common sense and corporate ethics in addition to ensuring compliance, and strive to cooperate with our business partners,
and build relationships based on trust.
2. We provide fair business opportunities to both domestic and overseas companies and conduct procurement activities from a global perspective.
3. We consider various conditions such as the quality, price, and stable supply of materials and raw materials in procurement activities. Moreover, we make efforts to set
appropriate prices and maintain and improve quality in cooperation with our business partners. Simultaneously, we promote green procurement in terms of environmental
conservation and chemical substance control.
4. We aim to create a sustainable society throughout the supply chain in conjunction with our business partners to fulfill the corporate social responsibility, including considerations
related to the global environment and protection of human rights and the working environment.
(Established: January, 2022)

Sustainable Procurement Guidelines
Ⅰ. Sound Corporate Management

1. We emphasize the realization of a sustainable society as management policy, establish a system to promote sustainability, work on this, make our business partners aware of
the significance of Sustainable Procurement, and attempt to disseminate such knowledge throughout the supply chain.
2. We comply with laws and regulations, adhere to social norms, and conduct fair and transparent corporate governance.
3. We have established a management system and mechanisms that ensure the effectiveness and efficiency of the company’s business operations, reliability of financial reports,
compliance with business-related laws and regulations, and preservation of assets.
4. We have established a system for the continuation or early recovery of important operations or businesses in the event of a disaster.
5. We ensure supply chain transparency and are not involved in conflict mineral procurement, crime, etc.
6. We ensure transparency and accountability to society and stakeholders.

Ⅱ. Fair Corporate Activities

1. We comply with laws and regulations related to commercial transactions, such as each country’s prohibition and competition laws, and conduct fair corporate activities
based on corporate ethics.
2. To prevent corruption, we refrain from paying inappropriate profits to or receiving them from business partners and maintain a healthy relationship between companies
and public servants.
3. We have eliminated relationships with antisocial forces and groups.
4. We respect and do not infringe on the intellectual property of third parties (patent rights, copyrights, trademark rights, etc.).
5. We have in place a whistleblowing system that ensures the confidentiality and protection of whistleblowers who come across important risk information.
6. We carefully manage and protect confidential information, including personal details, and take protective measures against threats to computer networks.

Ⅲ. The Environment
1. We comply with environment-related legal requirements in business activities and control chemical substances associated with products/services and manufacturing
processes as specified by laws and regulations.
2. We adhere to and comply with laws and regulations related to soil, air, and water.
3. We set voluntary targets to save and effectively use resources and energy.
4. We set voluntary targets and make efforts to achieve greenhouse gas reduction.
5. We set voluntary targets and make efforts to ensure waste reduction.
6. We manage the use of water, reduce its use as much as possible, and take measures to prevent direct drainage of water into the environment.
7. We work on biodiversity conservation and sustainable use.
8. We strive for green procurement through environmental conservation and chemical substance management.
Ⅳ. Human Rights
1. We support and respect the protection of international human rights. In addition, we do not discriminate based on race, nationality, gender, age, religion, sexual
orientation, sexual identity, disability, pregnancy, poverty, infectious diseases, and other differences.
2. We do not generate any impact that may support or promote human rights infringement, directly or indirectly, through our business activities.
Ⅴ. Labor
1. We respect diversity and strive to eliminate discrimination in recruitment and employment to ensure equal opportunities for employees’ development and evaluationand fair treatment.
2. We respect the individual human rights of employees and prohibit inhumane treatment such as abuse, bullying, and harassment.
3. In addition to the statutory minimum wages, we pay employees other benefits, including overtime work allowance and statutory benefits, in a fair manner.
4. We appropriately manage employees' working hours, holidays, and leaves to prevent exceeding the statutory limits.
5. We hire all employees based on their free will and do not force them to work.
6. We do not employ children below the minimum working age or engage in work that may impair their growth.
7. We respect employees’ right to organize to realize labor-management consultation on their working environment, wage level, etc.
8. We understand the accident risks that occur during work, including chemicals, noise, and odors that may harm employees’ health, and ensure a safe workplaceenvironment. We also respect employees’ work–life balance and adopt measures for their sound mental health.
Ⅵ. Quality and Safety

1. We ensure quality and safety when delivering products and services to the market.
2. In the event of an accident related to products/services or the distribution of defective products, we disclose information to our suppliers, notify the competent authorities,
recall products, and ensure systemic improvements such as safety measures.

Ⅶ. Building Connections with Local Communities
1. We respect the cultures and customs of the countries and regions where we conduct business activities and contribute toward the sustainable development of local
communities.
(Established: January, 2022)

151

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Health Management Declaration
Employees’ mental and physical health is the company’s most important asset.
The Sanyo Chemical Group actively promotes health to realize the richness in both private and company life. Together, we respect the diversity of employees, where each and every
employee is able to achieve personal fulfillment by showing their autonomy and creativity, and will continue to contribute to society through the development of our company.

(Established: September, 2018)

Social contribution policy
As a good corporate citizen, we contribute to the realization of an enriched society and sustained development.

1. Our efforts
By joining forces with a wide cross-section of society and effectively using available resources, we proactively engage in social contribution activities toward the development of
human resources who will lead the next generation and continue to provide solutions to social issues.
2. Response to the needs of countries/regions
By sharing the philosophy of social contribution within the group and coordinating with the group bases in countries and regions, we will develop social contribution activities
in accordance with the circumstances surrounding the individual countries and regions.
3. Information disclosure
By disclosing information and openly sharing the results of social contributions with society, we contribute to the realization of an enriched society and sustained development.
(Established: March, 2017)

152

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Code of Ethics andManagement

Responsible Care, Environment
and Safety

SocialAdvice on Compliance
DISCLOSURE POLICYPRIVACY POLICYSOCIAL MEDIA POLICYGUIDLINES ON THE RELATIONSHIP WITH MEDICAL INSTITUTIONS (In Japanese Only)
PUBLIC RESEARCH SPENDING (In Japanese Only)

153

GovernanceSANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Independent Review
Regarding the content of the Sanyo Chemical Group Sustainability Report 2023, the RC activities are verified by an outside organization, a third party, Responsible Care
Verification Center of the Japan Chemical Industry Association.

Report verification: Independent Review
Report verification: Responsible Care Report Verification
The report verification includes numerical verification of performance metrics aggregated by the head office, confirmation of documentation, and on-site checking of
implementation and operation at factories. We started to undergo an audit in 2005 at four factories of Sanyo Chemical and two subsidiaries/affiliates (two factories) in stages.
The Nagoya Factory, which has undergone an audit, is subject to verification for the fourth time.

154

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023
【Veriﬁcation history】
FY

TargetAuditee's place

2005

Environmental & Social Report 2005

Nagoya Factory

2006

Environmental & Social Report 2006

Kashima Factory

2007

Environmental & Social Report 2007

Kyoto Factory2008

CSR Report 2008

Kawasaki Factory in San Chemical Co., Ltd．

2009

CSR Report 2009

Nagoya facilities in SAN NOPCO LIMITED2010

CSR Report 2010

Nagoya Factory

2011

CSR Report 2011

Kyoto Factory2012

CSR Report 2012

Kawasaki Factory in San Chemical Co., Ltd．

2013

CSR Report 2013

Nagoya facilities in SAN NOPCO LIMITED2014

CSR Report 2014

Kashima Factory2015

CSR Report 2015

Kinuura Factory2016

CSR Report 2016

Nagoya Factory2017

CSR Report 2017

Kyoto Factory2018

CSR Report 2018

Kawasaki Factory in San Chemical Co., Ltd．

2019

CSR Report 2019

Nagoya facilities in SAN NOPCO LIMITED2020

CSR Report 2020

Kashima Factory2021

CSR Report 2021

Kinuura Factory2022

CSR Data Book 2022

Kyoto Factory2023

Sustainability Report 2023

Nagoya Factory155

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

RC verification: Independent Review
In FY2022, the Kashima Plant underwent verification of occupational health and safety activities, and the company underwent verification of environmental preservation
activities.

Verification of Occupational Health and Safety Activities for the Kashima Factory

Verification of environmental conservation activities for San Chemical Co., Ltd.

【Results of verification audits】
Date

Auditee's place

Target activities

October 2021

Nagoya Factory

Occupational safety and health

March 2022

Nagoya Factory

Environmental conservation

April 2022

Nagoya facilities in SAN NOPCO LIMITED

Environmental conservation

February 2023

Kashima Factory

Occupational safety and health

February 2023

Kawasaki Factory in San Chemical Co., Ltd.

Environmental conservation

RC Verification System
The Responsible Care Verification Center of the Japan Chemical Industry Association quantitatively evaluates the RC activities of companies and reports the resultswith advice according to the Responsible Care Codes*. This system validates each activity by RC code and reports the verification, such as the RC report.
* Responsible Care Codes
Responsible Care Codes are used to decide fundamental principles when implementing responsible care and describe the items necessary to move us toward our current understanding of theideal state. These codes consist of seven individual codes: the Management System Code plus the six codes in each filed of activity, such as Environmental Conservation, Accident Prevention,
Occupational Safety and Health, Logistics Safety, Chemicals/Product Safety, and Dialog with Society.

156

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Content Index

General Disclosures
Statement of use

Sanyo Chemical Group has reported the information contained in this GRI index for the period from April 1, 2022 to March 31, 2023 with reference to
the GRI Standards.

GRI 1 used

GRI 1: Foundation 2021

GRI Standards

Disclosures

References or reasons for omission

General Disclosures 2021
1.The organization and its reporting practices
COMPANY OVERVIEW
2-1

OVERSEAS BASES

Organiz ational details

SUBSIDIARIES & AFFILIATESDOMESTIC BASES
2-2

Entities inc luded in the organiz ation’s s us tainability reporting

OVERSEAS BASES
SUBSIDIARIES & AFFILIATES

2-3

Reporting period, frequenc y and c ontac t point

Editorial Polic y

2-4

Restatements of information

Sec urities report (J apanes e only )2-5

External as s uranc e

Independent Review

2-6

Activities , v alue c hain and other bus ines s relations hips

Sec urities report (J apanes e only )2-7

Employ ees

2-8Workers who are not employ ees

Information unav ailable/inc omplete: data notaggregated

Governanc e s truc ture and c ompos ition

Corporate Gov ernanc e

2. Activities and workers

Sec urities report (J apanes e only )Employ ee-related data

3. Governance
2-9

Sec urities report (J apanes e only )2-10Nomination and s elec tion of the highes t gov ernanc e bodyStandards for s elec tion of Direc tors
Div ers ity of the Board of Direc tors
Sk ills matrix

2-11

Chair of the highes t gov ernanc e body

Corporate Governance Report (In Japanese Only)

2-12

Role of the highes t gov ernanc e body in ov ers eeing the management of
impac ts

Sus tainability Management

2-13

Delegation of res pons ibility for managing impac ts

Sus tainability Management

157

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Standards

Disclosures

References or reasons for omission
Sus tainability Management

2-14

Role of the highes t gov ernanc e body in s us tainability reportingMes s age from the Direc tor in Charge ofSus tainability

Corporate Governance Report (In Japanese Only)

2-15

Conflic ts of interes t

2-16

Communic ation of c ritic al c onc erns

2-17Collec tiv e k nowledge of the highes t gov ernanc e body

Sk ills matrix

2-18

Evaluation of the performanc e of the highes t gov ernanc e body

Effectiveness evaluation of the Board of Directors

2-19

Remuneration polic ies

Corporate Governance Report (In Japanese Only)

2-20

Proces s to determine remuneration

Corporate Governance Report (In Japanese Only)

2-21

Annual total c ompens ation ratio

Information inc omplete: not aggregated

Sec urities report (J apanes e only )Corporate Gov ernanc e
Complianc e

4. Strategy, policies and practices
Mes s age from the Pres ident
2-22

Mes s age from the Direc tor in Charge ofStatement on s us tainable dev elopment s trategy

Sus tainability

Mes s age from the Pres ident
2-23

Mes s age from the Direc tor in Charge of

Policy c ommitments

Sus tainability
Res pec t for Human Rights

2-24

Embedding polic y c ommitments

Human rights due diligenc e: to s tart in 2023

2-25

Proces s es to remediate negativ e impac ts

Human Rights Polic y

2-26

Mechanis ms for s eek ing adv ic e and rais ing c onc erns

Internal whis tleblowing s y s tem

2-27

Complianc e with laws and regulations

Whis tleblowing, dis c iplinary ac tions , andFair trade and anti-c orruption
v iolations

2-28

Members hip as s oc iations

Major partic ipating organiz ations

5. Stakeholder engagement
2-29

Approac h to s tak eholder engagement

Stak eholder and Communic ation

2-30

Collec tiv e bargaining agreements

Sec urities report (J apanes e only )158

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Economic
GRI Standards

Disclosures

References or reasons for omission

GRI 201: Economic Performance 2016
201-1

Direct ec onomic v alue generated and dis tributed

Sec urities report (J apanes e only )201-2

Financ ial implic ations and other ris k s and opportunities due to c limate c hange

Dis c los ure bas ed on TCFD rec ommendations

201-3

Defined benefit plan obligations and other retirement plans

Sec urities report (J apanes e only )Financ ial as s is tanc e rec eiv ed from gov ernment

Selec ted for medic al res earc h and development
promotion grants in FY2019, FY2020, andFY2021. The grants were awarded.
Selec ted for medic al field res earc h results
deploy ment grants in FY2020, FY2021, andFY2022. The grants were awarded.

201-4

GRI 202: Market Presence 2016

202-1

Ratios of s tandard entry lev el wage by gender c ompared to loc al minimum
wage

Information inc omplete: data not c alculated

202-2

Proportion of s enior management hired from the loc al c ommunity

Information inc omplete: data not c alculated

GRI 203: Indirect Economic Impacts 2016
203-1

Infras truc ture inv es tments and s erv ic es s upported

Loc al Community / Soc ial Contributions

203-2

Signific ant indirec t ec onomic impac ts

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

GRI 204: Procurement Practices 2016
204-1

Proportion of s pending on loc al s uppliers

Information inc omplete: data not c alculated

GRI 205: Anti-corruption 2016

205-1

Operations as s es s ed for ris k s related to c orruption

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

205-2

Communic ation and training about anti-c orruption polic ies and proc eduresComplianc e

205-3

Confirmed inc idents of c orruption and ac tions tak en

Complianc e

GRI 206: Anti-competitive Behavior 2016
206-1

Legal ac tions for anti-c ompetitiv e behav ior, anti-trus t, and monopoly prac tic es

Complianc e

207-1

Approac h to tax

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

207-2

Tax gov ernanc e, c ontrol, and ris k management

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

207-3

Stakeholder engagement and management of c onc erns related to tax

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

207-4

Country -by -c ountry reporting

Diffic ult to obtain information: rec ognized as a
future is s ue, but no ac tion has been taken.

GRI 207: Tax 2019

159

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

Environmental
GRI Standards

Disclosures

References or reasons for omission

GRI 301: Materials 2016
Material flow

301-1

Materials us ed by weight or v olume301-2

Recyc led input materials us ed

Information unav ailable/inc omplete:
Raw materials : diffic ult to define and determine
Containers : not aggregated

Reclaimed produc ts and their pac k aging materials

Information unav ailable/inc omplete:
There are no produc ts returned from the market
for rec y c ling.
Pac k ing materials : not aggregated301-3

Climate c hange related data

GRI 302: Energy 2016
Material flow
302-1

Energy c ons umption within the organiz ation

GHG emis s ion reduc tion and energy savings
Climate c hange related data

302-2

Energy c ons umption outs ide of the organiz ation

302-3

Energy intens ity

302-4

Reduc tion of energy c ons umption

Dis c los ure bas ed on TCFD rec ommendations
Climate c hange related data

GHG emis s ions in Sc ope 1, 2, 3

Material flow
GHG emis s ion reduc tion and energy savings
Climate c hange related data

302-5

Reduc tions in energy requirements of produc ts and s erv ic es

Env ironmental Performanc e Chemic als

GRI 303: Water and Effluents 2018

303-1

Water c ons umption targets and res ults

Interac tions with water as a s hared res ourc e

Reduc tion of water c ons umption

Reduc tion of water pollutants dis c harge
303-2

Water res ourc e related data

Management of water dis c harge related impac ts

Emis s ion/trans fer of s ubs tanc es s ubject to PRTR
Law

Material flow
303-3

Water withdrawal

Water c ons umption targets and res ults
Reduc tion of water c ons umption

Material flow
Reduc tion of water pollutants dis c harge
303-4

Water dis c harge

Water res ourc e related data
Emis s ion/trans fer of s ubs tanc es s ubject to PRTR
Law

Material flow
303-5

Water c ons umption targets and res ults

Water c ons umption

Reduc tion of water c ons umption
Site report160

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Standards

Disclosures

References or reasons for omission

Operational s ites owned, leas ed, managed in, or adjac ent to protec ted areas
and areas of high biodiv ers ity v alue outs ide protec ted areas

Our fac tories are loc ated in areas that are
deemed appropriate in eac h c ountry and region.
Although thes e areas do not fall under protectedareas or areas with high biodiv ers ity value, greens pac es , ponds , etc . hav e been c reated around all
the fac tories as v oluntary initiativ es to conserve
the ec os y s tem in adjac ent areas .

Signific ant impac ts of ac tiv ities , produc ts , and s erv ic es on biodiv ers ity

The quality of the was tewater dis c harged exceeds
the was tewater quality s tandards es tablished by
the loc al gov ernments hav ing juris diction over theres pec tiv e fac tories . There is no impact on theec os y s tem c ons erv ation in adjac ent areas.

304-3

Habitats protec ted or res tored

Our fac tories are loc ated in areas that are
deemed appropriate in eac h c ountry and region.
Although thes e areas do not fall under protectedareas or areas with high biodiv ers ity value, greens pac es , ponds , etc . hav e been c reated around all
the fac tories as v oluntary initiativ es to conserve
the ec os y s tem in adjac ent areas .

304-4

IUCN Red Lis t s pec ies and national c ons erv ation lis t s pec ies with habitats inareas affec ted by operations

Not inv es tigatedGRI 304: Biodiversity 2016

304-1

304-2

GRI 305: Emissions 2016
G HG emis s ion reduc tion and energy savings

305-1

Direct (Sc ope 1) GHG emis s ions

305-2

Energy indirec t (Sc ope 2) GHG emis s ions305-3

Other indirec t (Sc ope 3) GHG emis s ions305-4

GHG emis s ions intens ity

305-5

Reduc tion of GHG emis s ions305-6

Emiss ions of oz one-depleting s ubs tanc es (ODS)

305-7

Nitrogen ox ides (NOx ), s ulfur ox ides (SOx ), and other s ignific ant air
emiss ions

GHG emis s ions in Sc ope 1, 2, 3

GHG emis s ion reduc tion and energy savings
GHG emis s ions in Sc ope 1, 2, 3

GHG emis s ion reduc tion and energy savings
GHG emis s ions in Sc ope 1, 2, 3

GHG emis s ion reduc tion and energy savings
GHG emis s ions in Sc ope 1, 2, 3

GHG emis s ion reduc tion and energy savings
GHG emis s ions in Sc ope 1, 2, 3

Fluoroc arbons
Emis s ions to the air

161

Material flow
Emis s ions to the air

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Standards

Disclosures

References or reasons for omission

GRI 306: Waste 2020
306-1

Waste generation and s ignific ant was te-related impac ts

306-2

Management of s ignific ant was terelated impac ts

Env ironmental management indic ators

Res ourc e Sav ing and Was te Reduc tion
Env ironmental management indic ators

Env ironmental ac tion plan 21-24
Material flow
306-3

Chemic al Subs tanc e Control

Waste generated

Res ourc e Sav ing and Was te Reduc tion
Was te and res ourc e s av ing related data
Site report

Material flow
306-4

Res ourc e Sav ing and Was te Reduc tion

Waste div erted from dis pos al

Was te and res ourc e s av ing related data
Site report

Material flow
306-5

Res ourc e Sav ing and Was te Reduc tion

Waste direc ted to dis pos al

Was te and res ourc e s av ing related data
Site report

GRI 308: Supplier Environmental Assessment 2016308-1

New s uppliers that were s c reened us ing env ironmental c riteria

Suppliers that were ev aluated to meet a certain
lev el bas ed on a CSR ques tionnaire or an
env ironment/c hemic al s ubs tanc es managements urv ey s heet at the time of s c reening ares elec ted.

308-2

Negativ e env ironmental impac ts in the s upply c hain and ac tions tak en

Sus tainable Proc urement

162

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

SocialGRI Standards

Disclosures

References or reasons for omission

GRI 401: Employment 2016
401-1

New employ ee hires and employ ee turnov er

Employ ee-related data

401-2

Benefits prov ided to full-time employ ees that are not prov ided to temporary orparttime employ ees

Not dis c los ed due to c onfidential information

401-3

Parental leav e

Employ ee-related data
Div ers ity, Equity & Inc lus ion (DEI)GRI 402: Labor/Management Relations 2016

402-1

Minimum notic e periods regarding operational c hanges

The minimum notific ation period is not determinedby labor and management in adv anc e. However,when an employ ee is trans ferred for businessreas ons , the employ ee is notified promptly after a
dec is ion is made.

GRI 403: Occupational Health and Safety 2018
Oc c upational Safety and Health/Ac cident

403-1

Occupational health and s afety management s y s tem

403-2

Hazard identific ation, ris k as s es s ment, and inc ident inv es tigation

403-3

Occupational health s erv ic es

Health and Produc tiv ity Management

403-4

Worker partic ipation, c ons ultation, and c ommunic ation on oc c upational healthand s afety

The Oc c upational Safety and Health Committee
promotes oc c upational s afety and health activities
bas ed on a c ons ens us between labor andmanagement.

403-5

Worker training on oc c upational health and s afety

403-6

Promotion of work er health

Health and Produc tiv ity Management

403-7

Prevention and mitigation of oc c upational health and s afety impac ts direc tly
linked by bus ines s relations hips

Details of a fatal oc c upational ac c ident on

403-8

Workers c ov ered by an oc c upational health and s afety management s y s tem

Prev ention

Oc c upational Safety and Health/Ac c ident
Prev ention

Oc c upational Safety and Health/Ac cident
Prev ention

J anuary 15, 2022

Oc c upational Safety and Health/Ac c ident
Prev ention

Details of a fatal oc c upational ac c ident on
J anuary 15, 2022
403-9

Work-related injuries

Oc c upational Safety and Health/Ac cident
Prev ention
Employ ee-related data403-10Work-related ill health

Health and Produc tiv ity Management

163

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Standards

Disclosures

References or reasons for omission

GRI 404: Training and Education 2016
Educ ation/training s y s tem

404-1

Average hours of training per y ear per employ ee

404-2

Programs for upgrading employ ee s k ills and trans ition as s is tanc e programs

Educ ation/training s y s tem

404-3

Percentage of employ ees rec eiv ing regular performanc e and c areerdevelopment rev iews

100% for full-time Sany o Chemic al employees.
The figure has not been determined for overseas
employ ees .

Employ ee-related data

GRI 405: Diversity and Equal Opportunity 2016405-1

Divers ity of gov ernanc e bodies and employ ees

Promotion of women’s empowerment

405-2

Ratio of bas ic s alary and remuneration of women to men

Sec urities report (J apanes e only )GRI 406: Non-discrimination 2016406-1

Incidents of dis c rimination and c orrec tiv e ac tions tak en

Res pec t for Human Rights
Complianc e

GRI 407: Freedom of Association and Collective Bargaining 2016

407-1

Operations and s uppliers in whic h the right to freedom of as s oc iation andcollec tiv e bargaining may be at ris k

Sus tainable Proc urement

GRI 408: Child Labor 2016

408-1

Operations and s uppliers at s ignific ant ris k for inc idents of c hild laborDue diligenc e will be promoted in ac cordance with
the Human Rights Polic y, whic h was establishedin Marc h 2023.
Sany o Chemic al Group Human Rights Policy

GRI 409: Forced or Compulsory Labor 2016409-1

Operations and s uppliers at s ignific ant ris k for inc idents of forc ed orcompuls ory laborDue diligenc e will be promoted in ac cordance with
the Human Rights Polic y, whic h was establishedin Marc h 2023.
Sany o Chemic al Group Human Rights Policy

GRI 410: Security Practices 2016
410-1

Security pers onnel trained in human rights polic ies or proc edures

Not applic able

GRI 411: Rights of Indigenous Peoples 2016

411-1

Incidents of v iolations inv olv ing rights of indigenous peoples

Due diligenc e will be promoted in ac cordance with
the Human Rights Polic y, whic h was establishedin Marc h 2023.
Sany o Chemic al Group Human Rights Policy

GRI 413: Local Communities 2016413-1

Operations with loc al c ommunity engagement, impac t as s es s ments , anddevelopment programs

Loc al Community / Soc ial Contributions

413-2

Operations with s ignific ant ac tual and potential negativ e impac ts on loc alcommunities

The Sany o Chemic al Group rec ognizes that there
are no bus ines s s ites that hav e a s ignificant
negativ e impac t (ac tual and potential) on local
c ommunities .

164

SANYO CHEMICAL GROUP SUSTAINABILITY REPORT 2023

GRI Standards

Disclosures

References or reasons for omission

GRI 414: Supplier Social Assessment 2016414-1

New s uppliers that were s c reened us ing s oc ial c riteria

Suppliers that were ev aluated to meet a certain
lev el bas ed on a CSR ques tionnaire at the time ofs c reening are s elec ted.

414-2

Negativ e s oc ial impac ts in the s upply c hain and ac tions tak en

Sus tainable Proc urement

GRI 415: Public Policy 2016

415-1

Complianc e

Politic al c ontributions

ESG Performanc e Data > Compliance

GRI 416: Customer Health and Safety 2016

416-1

Asses s ment of the health and s afety impac ts of produc t and s erv ic e
categories

Prov is ion of s afe and s ec ure produc ts
Des ign management
Not applic able: no v iolations

416-2

Incidents of non-c omplianc e c onc erning the health and s afety impac ts ofproduc ts and s erv ic es

Organiz ations related to quality as s urance,
quality c ontrol, and produc t liability (PL) and theirroles

GRI 417: Marketing and Labeling 2016
417-1

Requirements for produc t and s erv ic e information and labeling

Quality

417-2

Incidents of non-c omplianc e c onc erning produc t and s erv ic e information andlabeling

Quality

417-3

Incidents of non-c omplianc e c onc erning mark eting c ommunic ations

Not applic able: no v iolations
Whis tleblowing, dis c iplinary ac tions , andv iolations
GRI 418: Customer Privacy 2016

418-1

Substantiated c omplaints c onc erning breac hes of c us tomer priv ac y andlosses of c us tomer data

165

Not applic able: no v iolations
Whis tleblowing, dis c iplinary ac tions , andv iolations