Suminoe Textile Group

Integrated Report2022

For inquiries about this Report:
CSR Promotion Department
Suminoe Textile Co., Ltd.
11-20, Minami-Semba 3-Chome, Chuo-ku, Osaka 542-8504, Japan
TEL: 06-6251-6817 FAX: 06-6251-6806
E-Mail: csr@sin.suminoe.co.jp
URL: https://suminoe.co.jp/en/

The paper used for thispublication is certified as
being made from “timberfrom responsibly managed
forests.”

This publication was
printed using vegetableoil ink that has lessenvironmental impact.

The waterless printing techniqueused for this publication requires
no dampening solution andprevents the release of harmful
liquid waste during the printing
process.

This publication uses
easy-to-read fonts
designed based on the
Universal Design (UD)concept.

Interior Fittings
Providing comfortable and functional
interior products
Curtains | rugs and mats | carpets | wallpaper | sliding
paper doors | arts and crafts textiles | dancho (plush
hand-woven carpets that separate a stage from theauditorium) | dantsu (hand-woven carpets and hookedrugs)

Automotive Textiles
Adding higher value to automotive
textilesCeiling materials | seat covering materials | car mats |floor carpets

To make your everyday life more comfortable, safer and smarter, we
will continue to play an indispensable role in people’s lives and society.

Traffic Facilities

functionality and safety performance, our diverse products have continued to support amenity spaces and enriched lifestyles. We have

Supplying a total line of interiormaterials for public transportation
facilities

also worked to contribute to society through sustainable manufacturing of eco-friendly products, as exemplified by the development ofSeat covering materials | seat cushion materials |a one-of-the-kind carpet tile recycling technology.

carpets | floor signage film | curtains

The Suminoe Textile Group is a pioneer manufacturer of textiles for interior use in Japan. Throughout its history of more than 130 years
since its inception, the Group has always produced products that come in contact with people. Featuring outstanding design,

Just as we have always done, we will continue to provide value that only we can create, everywhere in people’s lives and society.

Functional Materials
Offering new functional products thatare friendly to human health andthe environment
Fabric-coated heating products | deodorizing filters |floor materials for bathrooms | interior materials foraircraft1

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 20222

Corporate Philosophy

Editorial Policy

Company Purpose

We contribute to the improvement of society
through the production and sales of good products,
and a prosperous business.

Contents

This year, we have begun to publish the Integrated Report in order

Corporate Philosophy ・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・3

to inform a broad range of stakeholders of how the Suminoe Textile

Editorial Policy and Contents・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・4

Group creates value in the medium and long term and what kind of
initiatives the Group promotes to enhance its corporate value.
This

reportprovidesfinancialinformation,

includingmanagement strategies to achieve sustainable growth as well as a

Suminoe Textile Group in Numbers・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・5
Progress in Value Creation・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・7

business overview and the performance of the Suminoe Textile

Message from the President・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・9

Group, and non-financial information on its specific sustainability

Medium- to Long-term Management Targets・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・12

and ESG initiatives. By disclosing such information in an integrated
manner, this report aims to help stakeholders deepen theirunderstanding of the Group.

Company Motto

We pride ourselves as a pioneer in the interior design and furnishingindustry and persist in a spirit of cooperation,
sincerity and determination.

Value Creation and Growth Strategies in Line with theMedium- to Long-term Management Targets

Referenced Guidelines
ISO26000 Guidance on Social Responsibility

Value Creation Model・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・13

Guidance for Collaborative Value Creation, published by the

Segment Information・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・15

Ministry of Economy, Trade and Industry (METI) of Japan
International Integrated Reporting Framework, published by theInternational Integrated Reporting Council (IIRC)

Scope of the Report
Suminoe Textile Co., Ltd. and its consolidated subsidiaries in Japanand overseas

Code of Conduct

1. We comply with all laws and ethical business standards, and conduct corporate
activities in an impartial and ethically sound manner.
2. We contribute to the advancement of the community through the production and saleof high-quality products.
3. We treat all employees of the Company fairly, act with due respect for their individual
personalities, and place high importance on their health and safety.
4. We place high priority on maintaining good relationships with all our stakeholders.
5. We make proactive contributions to the community, as expected of a good corporate
citizen.
6. We take very seriously the impact of our business activities on the global environment,
and contribute to environmental preservation initiatives.

Strategies by Segment: Interior Fittings ・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・17
Strategies by Segment: Automotive Textiles and Traffic
Facilities (Automotive Textiles)・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・19
Strategies by Segment: Automotive Textiles and Traffic
Facilities (Traffic Facilities)・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・21

However, the scope varies according to the items reported.

Strategies by Segment: Functional Materials・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・23

Period Covered

Research and Development Strategies・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・25

Fiscal year 2022 (From June 2021 to May 2022)(Some activities undertaken outside the above period are included.)

Message from the Director in Charge of Finance ・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・29

Information Disclosure System
Financial information

Non-financial information

Integrated Report (book and website)
Medium- to Long-term Management Targets“SUMINOE GROUP WAY 2022-2024-2027”• “Investor Relations”
section of the website• Securities Report(Japanese only)• Flash Report of Financial
Results• Business Report(Japanese only)

Feature: Reorganization of the Nara Factory・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・27

• Corporate Governance
Report (Japanese only)• ESG Report (Japaneseonly)

ESG Initiatives in Line with the Medium- to Long-termManagement Targets
Sustainability and ESG Initiatives ・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・31
Environment・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・33
Social・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・39
Governance・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・45
Messages from Outside Directors・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・51

Board of Directors and Corporate Auditors・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・53
Disclaimer about Forward-Looking Statements

Eleven-year Consolidated Financial Summary・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・55

Among all the current plans, strategies, and judgments that are

Corporate Summary / Investor Relations ・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・57

included in this Report, those which are not historical facts represent
our forecasts for future performances, etc. These are on the basis of
assumptions and judgments based on information currently
available for the Suminoe Textile Group and may thus contain risks
and uncertain factors. Please be advised, therefore, that the Group’sbusiness results that will be publicly announced in the future may
differ significantly from the forecasts due to various factors.

3

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 2022

4

Suminoe Textile Group in Numbers* Average figures of Group companies only in JapanFoundedNumber of Employees (As of May 31, 2022)

Capital (As of May 31, 2022)

9,554

1883

In Japan

1,551

million yen

Net sales (Fiscal year 2022)

81,713

Interior Fittings

32,811

million yen

45,005

million yen

Functional Materials

349

million yen

million yen(Million yen)

(Million yen)

81,713

2.3

3,118

20,000

1,557

1,000

0

2020

2021

2022

2018

2019

Net assets / Total assets(Million yen)(%)

(Million yen)

1.2

100,000

1.1

1.0
1,500

1,000

(Million yen)

1,083

467

2020

409

142

0

2018

2019

2020

2.4

Equity■ Equity

40,000

0.3

0.4

281

0.2

110

0

2021

2022

■ Net assets■ Total assets

34.8

40,00034,05730,000

32.5

33.5

2,358

27,99828,04487,97586,272

83,66984,80135,271

2018

Suminoe Textile Group Integrated Report 2022

2020

Inventories / Inventory turnover

2021

2022

32,95633,44840
20(Times)

5.9

6.3

6.1

15,666

14,939

7.0

6.2

0.7

0.593

0.566

0.557

0.6

0.496
62.2

58.5

0.5
0.4

51.0

45.1

40.5

0.3

18.7

16.6

0.2

23.8

22.4

38.4

36.1

32.3

26.4

23.9

2018

2019

2020

2021

2022

18.8

0.1
0

Ratio of female employees*
（%）
35

5.2
5.0

12,861● Basic unit(t/¥1 million)

0.635

0

2022

■ Inventories ● Inventory turnover

32.0

32.0

31.8

2020

2021

2022

31.1

15,621

30.3

10,000

0

0

2019

2020

2021

2018

2022

2019

2020

2021

(Million yen)

3.5

3.0

30

0

0

3.2

2022

■ Capital investment

2018

2019

Number of employees who took childcare leave* ■ Female

4,636

4,000

15

3,000

1.5
1.0

1.0
0.5

2,000
1,000

9

2,677

1.5

1.4

12

3,516

2.5
2.0

1,725
1,171

1,769

2,030

1,979

1,915

1,617

2018

2019

2020

2021

2022

2019

8

6

0

2018

9

2020

2021

2022

13

12

11

3

3

0

0

■ Male(Number of employees)

5,000

3.0

0

2021

2019

（%）

20

0

32,5820.5■ Overseas

5,000

0.5

2020

19.9%

80

0

40

28,30410,000

950

0

(%)

33.4

1.0

1,211

1,000

16,63438,541

100

1.5

1.2

Depreciation / Capital investment ■ Depreciation

10

2019

1.5

1,323

20,000(1,000 t)

3.0

60

Return on equity (ROE)● Equity ratio

20,0002018

6-10 years

18.8%■ Domestic

2.0

1.4

2,000

15,0002018

30

30,588

2,956

3,000

25,00020,0002022(Million yen)

36.9

years

11-20 years

Reduction of CO2 emissions in business activities

(%)

2.5

(Million yen)

92,18180,000

0

2021

3.0

0.6

0.5
0.2

15.5

21-30 years

18.3%
23.6%

● Ratio of ordinary income

0.5

60,000

0.5

34.0%

4,000

0.8

500

50,000

1.0

1,049
0.1

Profit attributable to owners of parent / Ratio of profit attributable to ownersof parent to net sales ■ Profit ● Ratio of profit attributable to owners of parent
2,000

1.5

1.3

0

2019

■ Ordinary income

2.0

1.7

2,247

2,000

2018

Averagelength of service*

40s

Ordinary income / Ratio of ordinary income to net sales

3.0
2.5

3,000

40,000

3.5

3.2

4,000

60,000

5

(%)

5,000

79,70280,000Female0-5 years

27.2%* Group companies in Japan only
■ Operating income● Operating margin

Operating income / Operating margin
91,512

Male

14.0%

17.1%

years old

50s

1.7%

31-40 years

30s

45.6

1,089

Other

41-49 years

0.7% 20s
13.4%

Average age*

Overseas

million yen

10s

Non-financial Data (for each FY ended May 31)

Net sales
98,617

10.7%

0.5%

Automotive Textiles and Traffic Facilities

Financial Data (for each FY ended May 31)

97,87270s

60s(Consolidated Group companies: 2,640)

3,548

10,00062% 38%

0

0

2018

2019

1

0
2020

2021

2022

Suminoe Textile Group Integrated Report 2022

6

Progress in Value Creation

Suminoe Textile was founded by rice dealer Denshichi Murata, who opened the Murata Factory in 1883 in Sumiyoshi Village,
Higashinari-gun, Osaka Prefecture (now Sumiyoshi Ward, Osaka City).
This small factory in a private household was receiving orders for interiors for railway cars and ships, and even for the Imperial Diet
Building, heralding the dawn of Japan’s carpet industry.

1880s

1900s

1930s

1940s

Contribution to Japan’s Modernization
Industrial Revolution
in Japan

Taisho Democracy

1970s

Popularizing Interior Fabrics

in Common Households

1990s

2000s

2020s

Offering One-of-a-Kind Products to Customers around the World

World Depression
World War II

High economic growth
periodPeriod of increasing globalization
Bubble economy
Manifestation of environmental
problems

Collapse of the bubble economy
IT revolution

A declining birthrate andaging population

Novel coronavirus (COVID-19)
pandemic

1930
Suminoe Textile Co., Ltd.
established.
1937
Kawachi Factory established,
where woolen spinning begins.

1949
Shares listed on the Tokyo,
Osaka, and Kyoto stock
exchanges.
1954
First to introduce to Japan atufting carpet machine from the
U.S.

1971
Nara Factory (now Nara Factoryof Suminoe Techno Co., Ltd.)established, and Sumiyoshi
Factory closed.
1987
Shiga Office established.

1994
T.C.H. Suminoe. Co., Ltd., theCompany’s first overseas base,established as a joint venture in
Thailand.
1998
Suminoe Textile Group“SUMINOE Environmental
Declaration” and “KKR+A”
announced.

2003
Suminoe Textile of America
Corporation established in the U.S.
2005
SPM Automotive Textile Co., Ltd.
established as a joint venture in
China.
2009
Suminoe Teijin Techno Co., Ltd.
established as a joint venture.
2013
Suminoe Techno Co., Ltd.
established.

2020
Shares of CPO Co., Ltd. acquired.
2022
Shares of PRETERIOR-TEXTILE
Inc. acquired, which becomes a
subsidiary of Suminoe Textile
Co., Ltd.
Shares of Seki Textile Co., Ltd.
acquired, which becomes a
subsidiary of Suminoe Textile
Co., Ltd.

History of the Suminoe Textile Group1883
Murata Factory founded.
Manufacture of handwoven
carpets begins in Sumiyoshi,
Osaka.
1892
The Company’s first patentobtained for carpet weaving,“Yamato-ori.”

1903
Sumiyoshi Factory withfull-scale weaving facilities
established.
1913
Suminoe Textile Joint-Stock
Company established.
1916
Manufacture of carpets using
power looms begins.

Value Offered by the Group

1891

1971

1913

● Winning acclaim for Dantsu
carpet-weaving techniques

Winning acclaim for its manufacturing techniques,
the Murata Factory supplied Dantsu hand-woven
carpets to the Imperial Diet Building. We havecontinued to deliver the “red carpet” and otherinterior textiles for the present-day Diet Building.

● Mass production realized byusing power looms

The Company imported technology and powerlooms from Germany and the U.K., becoming thefirst in Japan to manufacture machine-woven
moquette.

1899

1931

● Helping widespread use of
carpets in general households

Although carpets had usually been custom-made,high-end products, the Company released aready-made carpet called “Tafton,” which wasaffordably priced for ordinary households.

● Manufacture of Japan’s firsthand-woven moquette

The Company received an order to manufacture
the seat covers used in trains of Japan National
Railways, which had conventionally used imported
seat covers. We succeeded in producing andsupplying hand-woven moquette as a seatcovering for the first time in Japan.

7

Suminoe Textile Group Integrated Report 2022

● Participating in the automotive
industry in its infancy

Suminoe Textile supplied carpets and seatcovering materials to automobiles assembled andmanufactured in Japan for the U.S. automakers,
Ford Motor Company and General Motors.

● Construction of a newpollution-free carpet factory

When pollution problems attracted muchattention, our Nara Factory was newly constructed.
The factory was equipped with effluent treatment
facilities in order to prevent leakage of hazardous
substances discharged with wastewater.

● Development of a continuous fiber
made from recycled polyester

スミトロン® (SUMITRON), which uses polyester
chips recycled from PET bottles as raw material
by 50% or more, contributes to resource-saving.

1980

1968

● Producing a 836 m carpet by hand
2

The Homeiden Imperial Palace building is a banquet
hall, the largest of all the Imperial Palace halls. Suminoe
Textile provided for this hall a hand-woven dantsu
carpet of 836 m2. Its manufacturing process required
approximately 10,000 weavers, who spent as long as
nine months to complete this masterpiece carpet.

2011

1989

1957

● Production of Japan’s first carpet
tiles
Suminoe Textile produced carpet tiles that can
express mosaic patterns. It is easy to replace thedamaged carpet tiles with new ones. With theseadvantages, these carpet tiles attracted muchattention as an innovative product.

● Development of recycled carpet tiles

We established a framework for repeating the recycling
cycle involving the same products for carpet tiles.
These recycled carpet tiles became the first to becertified as Eco Mark products under new standards.

1998● Development of around-the-clock
deodorizing treatment technology

Suminoe Textile developed トリプルフレッシュ®
(TRIPLE FRESH) treatment technology, which candeodorize and decompose substances that cause sickhouse syndrome and other malodorous substancesthat are generated daily in our environment on a
24-hour basis. This technology contributes toprotection of people’s health.

The past, the present andthe future● Passing on traditional techniques
to future generations
While promoting business reforms, the Suminoe
Textile Group maintains and cultivates
hand-weaving techniques handed down inJapan’s historical industry, thereby making culturalcontribution.

Suminoe Textile Group Integrated Report 2022

8

Message from the President

Shaping a Better Future through the Concerted
Efforts of the Entire Group
Taking on challenges toachieve further growth
based on the founding “spirit”

Respect for the founding spirit
The Suminoe Textile Group upholds the Company Purpose, whichreads: “We contribute to the improvement of society through the
production and sales of good products, and a prosperous business.”
The Company Motto that we follow states that “We pride ourselves
as a pioneer in the interior design and furnishing industry andpersist in a spirit of cooperation, sincerity and determination.” Ever
since its founding, in keeping with this Company Purpose andMotto, the Group has consistently taken on new challenges in
response to the needs of the times and worked to develop andprovide products that benefit society. For instance, the Group
became Japan’s first to hand-weave a Wilton-style carpet, tomanufacture seat materials for railway carriages, and to create
carpet tiles. The Group’s ECOS® series, eco-friendly carpet tiles under
the horizontal recycling system, obtained Eco Mark certification byfulfilling its new criteria, for the first time in the industry. These
examples demonstrate the enterprising attitude and the frontier
spirit of our predecessors.
The Company Motto contains the phrase “a spirit ofcooperation,” which indicates the ideal state of our relationships
with customers and suppliers and that of the relationships among
our employees. I could say that this is the concept that leads totoday’s sustainability. The Motto also includes the word “sincerity,”
which should form the basis of a business enterprise. With a strong
resolution never to repeat any insincere behaviors, the Group has
been continuing “management by walking around,” under which
executives in person frequently visit workplaces, as part of ongoing
efforts to reinforce governance. The word “determination” isembodied by our history of 139 years. Throughout so long a history,
we have continued business while overcoming many serious
hardships and tiding over difficult times. The outlook still remains
uncertain due to the prolonged COVID-19 pandemic and theincreasingly volatile international situation. In this present context, I
realize anew the significance of upholding “determination” in our
Company Motto.

Embracing challenges to achieve next-stage
growth, with pride as a pioneer

Teppei Nagata
President
Suminoe Textile Co., Ltd.

9

Suminoe Textile Group Integrated Report 2022

Aiming for next-stage growth, we have been striving to accomplish
the Medium- to Long-term Management Targets “SUMINOEGROUP WAY 2022-2024-2027” (hereinafter SGW), launched in June
2022. The SGW has set targets for consolidated net sales at 100
billion yen or more and for an operating margin at 5% or more, by
the fiscal year ending on May 31, 2027. To achieve these targets, it isliterally indispensable to constantly take on new challenges to
produce products that benefit society, with pride as a pioneer. In
particular, in the present time when social situations are rapidlychanging, I believe that we need to bring together the wisdom of
the entire Group to create innovation faster than before. At thesame time, the Group has started to identify a purpose (the reason
for the existence of a company) that provides spiritual support for
employees. We are endeavoring to determine and announce a
purpose that will better reflect contemporary society and times,
based on the Company Motto and the Company Purpose, whichhave been embraced ever since the founding of the Suminoe
Textile Group.

In the first year of the SGW, we moved forward
to achieve the final targets, albeit falling short of
the Medium- to Long-term Management Targets
The fiscal year ending May 2022 was the important first year of theSGW. However, we had no choice but to make a downward revision
to our initial plan since the Automotive Textiles and Traffic Facilities
segment, which drives the Group’s performance, was significantly
impacted by the COVID-19 pandemic and the shortage ofsemiconductors and components. On a consolidated basis, net
sales increased by 2.5% year on year to 81,713 million yen, whereas
we posted declines in operating income, ordinary income, andprofit attributable to owners of parent. Operating income sharply
declined 89.5% year on year to 110 million yen. Despite these lower
profits, the said fiscal year saw each business segment steadilypaving the way for future growth, making us feel certain that wewere able to move a step closer to achieving the final targets.
In the Interior Fittings segment, to strengthen the spacedesign business, we acquired shares of CPO Co., Ltd., which isengaged in designing various retail stores, so that it became asubsidiary of Suminoe Textile Co., Ltd. in August 2020. This wasfollowed by the acquisition of another company that sells interior
products, PRETERIOR-TEXTILE Inc., which joined the Group as a
subsidiary in January 2022. In addition, our ECOS® series,
eco-friendly carpet tiles under the horizontal recycling system, hasachieved a recycled material ratio of approximately 70% by weight,
which is among the highest in the world. We are pleased that
ECOS® won two major prizes: the Economy, Trade and Industry
Minister’s Prize in the 4th EcoPro Awards and the Grand Prize in theplastic resource recycling special category of the 22nd Green
Purchasing Award. On the back of winning these prizes, ourpresence as “Eco-friendly Suminoe” increased, leading to large
incoming orders. Due partly to the effect of price revisions, theInterior Fittings segment posted growth in sales and profit.
In the Functional Materials segment, we received increasedorders for fabric-coated heating products, such as electric carpets,
and floor materials for bathrooms. The Company also completed
the consolidation of factories in China and Vietnam, inconsideration of the country risk and future costs. We can now
expect an improvement in cost-effectiveness in the next fiscal year
and onward.
Furthermore, in May 2022, we completed the project forreorganizing the Nara Factory, the mother plant of the Group. In
addition to improving production and logistics efficiency, weconstructed a new R&D building so as to further enhancecollaboration between R&D and production technology divisions. As
a result of the reorganization, functions of the Interior Fittings andAutomotive Textiles segments have been divided more clearly: The
Nara Plant of Suminoe Techno Co., Ltd. focuses on production ofinterior products, while the Shiga Factory focuses on production of
automotive textiles. We look forward to seeing the effects of thisfunctional differentiation in the fiscal year ending May 2023 and later.
As for the Automotive Textiles segment, in order to expand

Suminoe Textile Group Integrated Report 2022

10

Message from the President

Medium- to Long-term Management Targets

the North American market, we decided to build a new production
line for synthetic leather at Mexico, Suminoe Textile de Mexico, S.A.
de C.V. (STM), our subsidiary in Mexico. STM will start mass
production in March 2024 and will contribute to the Group’s
performance from the fiscal year ending May 2025. Our subsidiaryin the United States, Suminoe Textile of America Corporation (STA),
is in the process of a significant organizational change. In the Traffic
Facilities segment, the Company acquired Seki Textile Co., Ltd.,
which has Japan’s leading processing technology for moquette
production. We also make consistent efforts to strengthen business
continuity planning (BCP).
With regard to the plan for the fiscal year ending May 2023, weagain revised the planned figures downwardly from those targetedat the time of the SWG formulation, but the strategies and measuresremain unchanged. Although the outlook remains uncertain, we
anticipate that, after the external environments surrounding theAutomotive Textiles and Traffic Facilities business improve, theGroup will reach its interim targets—net sales of 93.4 billion yen andoperating income of 3.3 billion yen—in the fiscal year ending May
2024, the third year of the SWG. We also believe that the Group will
be able to achieve net sales of 100 billion yen or more and operating
income of 5% or higher in the final year of the SWG, i.e., the fiscal
year ending May 2027, based on our forecast that STA will return toprofitability, measures being taken in the current fiscal year will
prove effective, and depreciation will decrease in that year.

Focusing on our medium- and long-term “ideal corporate image,” we established our policy throughthe fiscal year ending May 2027. In line with the policy, we have been working to achieve our targets.

Forging a solid footing to grow as anenterprise that can surely contribute torealizing a sustainable society
Suminoe Textile will mark its 140th anniversary of its founding in
2023. To continue to grow into the future, the Group must remaincommitted to being an enterprise that brings value to society andthat is required by all stakeholders.
Employees are our stakeholders and the driving force for theGroup to create value. As such, our most important task is to “create
workplaces for employee happiness” for these employees. On June
1, 2022, the Group announced its Basic Policy on Sustainability and
Related Policies, which lays out initiatives for human resources
development, diversity and inclusion, and work-life balance. The
key to future success lies in ensuring these policies arecommunicated to and observed by every member of the Group.
We also aim to be certified as a Health & Productivity Management
Outstanding Organization by the fiscal year 2025, and we plan tohold round-table discussions for employees in respective age
brackets from 20s to 50s. As part of initiatives for human resource
development, the Company will nurture next-generation
management personnel, including female managers.
Other priority challenges for the Group include to “improve
work efficiency” and “improve corporate brand value.” We arepromoting restructuring of the core systems aimed at moretransparent business operation, with these systems slated forcompletion in the fiscal year ending May 2025. Efforts are also under
way to increase efficiency in warehouse activities in logistics throughthe effective use of digital technology. In regard to improving
corporate brand value, we launched a cross-departmental project

11

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Co., Ltd. formulated “SUMINOE GROUP WAY 2022-2024-2027,” Medium- to Long-term Management Targets (SGW). Now
one year has passed since we started to work on the SGW in June 2021. All employees of the Group companies are joining forces toachieve these targets by increasing sales of products that meet social needs and by promoting global management, based on the ESG
management that the Group has focused on to date.

Establish better business models to globally grow as a company required by society.
Gain sound profits to invest in future growth.
● Strengthen ESG management.
●

Management
policy●Expand sales and build a foundation for the growth. ● Improve financial structure.
Create workplaces for employee happiness.
● Share the Company’s vision with employees.
●

involving various members, ranging from executives to young
employees, to ensure that the SUMINOE brand is chosen bystakeholders who feel empathy with us. These project members
hold discussions from diverse perspectives.
On the other hand, there are many social issues to be resolved
to establish a sustainable society. Among other things, we areaware that the response to climate change issues is important. In
April 2022, the Suminoe Textile Group announced its Second
SUMINOE Environmental Declaration. At the same time, the Groupset a target for reducing CO2 emissions 35% from the fiscal 2014
levels, by the fiscal year 2031. To accomplish this target, we will
intensify our efforts to reduce energy consumption in business
operations and introduce photovoltaic power generation systems.
Meanwhile, we will strive for development and sales expansion of
products that contribute to the recycling of resources, as
exemplified by ECOS®. We will also work to develop new seatcovering materials using a plant-derived fiber.
As for the financial impact of climate change, we will conduct
scenario analysis and clarify the impact, following the TCFD
recommendations on climate-related financial disclosures, in thenext fiscal year and beyond.
We always seek to be better than we are today through theconcerted efforts of the entire Group as we move forward into the
future. We have addressed challenges at hand and used the lessons
learned from these challenges, regardless of whether the outcome
is a success or failure, as valuable experience for undertaking thenext challenge. Through the endless repetition of such attempts,
we have made continuous efforts, which have made the Group
what it is today. I am confident that our present hard work will help
us shape a better future.
Even in the harsh business environment, we will first secure a
5% operating margin to enhance our corporate value, aiming togrow as an enterprise that can live up to expectations ofshareholders and investors. Please expect the future developmentof the Suminoe Textile Group.
November 2022

President
Suminoe Textile Co., Ltd.
Teppei Nagata●

Targets

Safe and secure work environment
Participation and cultivation of diverse
human resources● Enhance governance.
● Improve work efficiency using coresystems.
● Improve corporate brand value.

Reduce CO2 emissions, and develop
and distribute products forenvironmental measures.
● Strengthen cost competitiveness.
● Develop highly unique products.
● Expand sales of products with
antibacterial and anti-virus effects.

●●

Challenges●

SUMINOE GROUP WAY POLICY
Financial targets

Expand sales and build a foundation for the growth.

Non-financial targets●

Operating margin: 5% or more ● Investment plan for building a foundation for growth● Develop and promote the sale of products for environmental measures.

Improve financial structure.
●

Improve D/E ratio.

●

Increase inventory turnover.

●Effective use of treasury stock

Create workplaces for employee happiness.
●

Create healthier work environment.

●

Cultivate human resources.

●

Effectively use diverse human resources.

Share the Company’s vision with employees.
Consolidated net sales:

Consolidated net sales:

Consolidated net sales:

100 billion yen or more

93.4 billion yen

79.7 billion yen

FY2021

FY2024FY2027

Three-year Consolidated Income and Expenditure Plan
Net sales (left axis)

100,000
90,000(Million yen)
Ordinary income (right axis)

620

FY ended May 2022 (Plan at
the time of SWG formulation)

89,0002,520 2,730

81,713
1,160 1,350

950
110

Profit attributable to owners of parent (right axis)

1,280
FY ending May 2023 (Plan at
the time of SWG formulation)

1,960

1,700 1,800

FY ended May 2021
Net salesInterior Fittings
Operating income
Automotive Textiles Net sales
and Traffic Facilities Operating income
Net sales
Functional Materials
Operating income

31,024579
45,102
2,102
3,130
-87

2,000

500
FY ending May 2023 (Plan at
the beginning of the FY)

FY ending May 2024 (Plan at
the time of SWG formulation)

Major Numerical Targets and Results by Business Segment
Actual results

4,000

3,300 3,530

281

FY ended May 2022
(Actual results)

6,000

93,49090,36086,48080,00070,000Operating income (right axis)

0(Million yen)Three-year Consolidated Income and Expenditure Plan (Fiscal years ending May 2022 to 2024)
FY ending May 2024
FY ended May 2022
FY ending May 2023
Plan at the time of
SWG formulation

33,750400
48,980
2,800
3,410
-140

Actual results

32,811
911
45,005
1,127
3,548
-192

Plan at the time of
SWG formulation

34,430450
51,910
3,590
3,680
150

Plan at the
beginning of the FY*

33,760630
51,310
2,820
3,530
-50

Plan at the time of
SWG formulation

35,120520
54,170
4,170
3,840
190

* Dated July 15, 2022

Suminoe Textile Group Integrated Report 2022

12

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Value Creation Model

Based on its Corporate Philosophy, the Suminoe Textile Group will create value that contributes to society, thereby helping realize asustainable society and enhancing our corporate value.
External
environment

Input (Capital and Strengths)

Business Segments and Output

Value that the Group Offers

Manufacturing capital
Environmental
risk

Shortage ofresources andenergyChange inthe mobility
society

Aging /
Shrinking labor
force

Working stylereforms

Technologies and products the Grouphas created based on its fundamental
development philosophy

Capital investment 4.63 billion yen
Consolidated manufacturing subsidiaries
in 8 countries
Globally optimized supply system
Equipment dedicated to producing
eco-friendly products
Strong relationship with each factory

Interior Fittings●

Human capital
Consolidated number of employees:
2,640Management who exhibit various
specialties to enhance corporate value
Diverse human resources well versed invarious business fields

Intellectual capital
R&D expenses: 980 million yen
Number of patents held: 135
Cooperation between development
personnel
Intellectual property creation

Social and related capital
Customers and suppliers belong todifferent markets
Industry-academia partnership
Historically established trust fromstakeholders
Harmonious coexistence with local
communities

Automotive Textiles

トリプルフレッシュ® (TRIPLE FRESH) deodoranttreatment technology
Antibacterial and anti-virus processing
technology トリプルフレッシュ®デオ (TRIPLE
FRESH DEO) and クインテック® (QUINTECH)
Automotive carpets with noise-absorbing andsound insulating properties
Automotive seat covering material“e.colore®” (eco-loré), which has
reduced the dyeing process

p.19

Able to apply its technologies
related to various interior textiles,
such as fabrics, carpets and mats, toother business segments● Stability in quality and supply achievedby strong supply chain management●

Human resources witha wide variety of skills
Specialist know-how regarding manufacturing

Capabilities that form thecore of the Suminoe Textile
Group

Technology anddevelopment capabilities

Traffic Facilities

p.25

Automotive ceiling materials featuring
greater ease of recycling after use
Plant-derived automotive textiles andinterior materials for traffic facilities
Seat cushion material for train cars
SUMICUBE®, made from raw
materials that emit no poisonous
gases when combusted for
disposalp.21

Capability to realize high durability
and flame-retardance required by
textiles used in public transportation
systems● Maintaining a large market share formore than a century based on trust
established over a long history●

Design capability that enables the matchingof manufacturing and market needs
Historically established trust

Olefin bathroom flooring thatgenerates no poisonous gases at thetime of combustion

R: Recycling
ECOS® series, eco-friendly carpet tiles
under the horizontal recycling system
Recycled polyester fiber スミトロン®
(SUMITRON)

Ability to change in accordance with market needs
Functional Materials

Sustainable resources, including thoseenabled by photovoltaic power
generation, etc.
Total energy consumption
Energy use●

Financial capital
Growing publicawareness of
ESG and SDGs

K: Kenko (Health)Able to propose diverse solutions,since the Group has multiple
functions as a manufacturer,
wholesaler and constructor, andalso able to design and construct
an entire space

K: Kankyo (Environment)

Natural capital
informationoriented society

p.17

Total assets: 84,801 million yen
Interest-bearing debt: 18,999 million yen
Equity ratio: 33.4%
Aggressive M&A

Nylon yarn recycled from discarded
fishing nets

p.23

Capability for sales and development
to create new products required bymarkets, cultivated through sales
activities leveraging a wealth offunctional materials and functional
processing technologies that are
unique to the Group

A: Amenity

Social value
Environmental value

pp.33-38

Reduce environmental impact frombusiness operations
Reduce environmental impact fromproducts
Reduce the amount of industrial waste
generated
Realize a circular economy
Strengthen environmental management

Value offered to stakeholders
Customers and consumers
Improve quality of life (QOL)
Reduce environmental impact
Employees

pp.39-40

Diversity & inclusion
Promote health management andwork-life balance
Suppliers
Strengthen relationships by building a
responsible supply chain
Improve technological capabilities andmutual growth through transactions
Shareholders and investors
Profit returns to shareholders throughenhancement of corporate value
Strengthen partnerships
Local communities
Revitalize the local economy throughemployment and social contribution
activities

Smart textiles that contribute to acomfortable life

Economic value

Fabrics for car trim accent GRACE CORD®, etc.,
which enhance originality

Net sales 81,713 million yen

Flame-resistant flooring film for signs toindicate priority spaces in trains and buses

Profit attributable to owners of parent
281 million yen

Fabric-coated heating products
Tispa® Series deodorizer for home use

Operating margin 0.1%
ROE 1.0%

Medium- to Long-term Management Targets “SUMINOE GROUP WAY 2022-2024-2027” p.12

Governance, compliance, and risk management pp.45-50

Environmental management pp.33-38 Corporate Philosophy p.3

Basic Policy on Sustainability p.31

D/E ratio 0.67 times

Enhance the Group’s capital and strengths
Contribute to resolving social issues

13

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 2022

14

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Segment Information

Net sales and percentage to total

Overview of business resultsfor FY ended May 2022

Three-year consolidated income and expenditure plan
Net salesInterior Fittings

40.2%

32,811
million yen

Sales of household carpets andcurtains were sluggish due to theimpact of the COVID-19 pandemic.
However, total net sales in the Interior
Fittings segment increased because of
the contribution from sales of thespace design business and the solid
performance of wall covering-related
sample books combined with theeffect of price revisions.

55.1%

45,005
million yen

4.3%

Functional Materials

3,548
million yen

Although overseas automobile-related sales increased thanks to strong car
sales and the effect of foreignexchange rates, domestic automobile-related sales were affected by thedecrease in production due to theshortage of components and sluggish
sales of traffic facilities products. This
resulted in a slight decline in net salesof this segment as a whole. Profits
were significantly impacted by soaring
prices of raw materials as well as rising
distribution costs.

Orders received for fabric-coatedheating products increased as theimpact of the warm winter in the fiscal
year ended May 2020 dissipated.
Orders for floor materials forbathrooms were also robust. In terms
of profits, the Functional Materials
segment was adversely affected by thedecrease in income from deodorizing
filters for air purifiers, a surge in costs
related to the import of fabric-coatedheating products, and consolidation
costs for factories in China andVietnam.

■ Results(Million yen)

■ Plan40,00033,30030,00031,02432,811 33,760■ Results■ Plan

630

579

600

520

472

1.5

200

1.0

0
2021

2022

2023

2024

Net sales■ Results

60,00054,075
45,102 45,005

51,310■ Plan54,170

2021

2022

2023

2024

■ Results

2021

2022

2023

2024

Net sales■ Results

3,928

3,548 3,530■ Plan

3,840

3,130

3,000

2024

7.7

4.9

5.5
4.7
2.5

1,127

2.0

0
2021

2022

2023

2024

2020

2021

2022

2023

■ Results■ Plan190

200● Results ● Plan

（％）
5.0

4.9

4.0

79
-87

2024

Operating margin(Million yen)

0

2,000

2023

4.0

2,102

2020

100

2022

● Results ● Plan

2,820

2,652

Operating income(Million yen)

2021

（％）

6.0

0
2020

2020

4,170

1,000
0

1.5

1.4

8.0

2,000

20,000■ Plan

5,000

3,000

1.9

Operating margin(Million yen)

4,000

40,000

1.9

0
2020

Operating income(Million yen)

2.0

400

0

2.8

2.5

800

10,000● Results ● Plan

（％）
3.0

911

35,12020,0004,000

Operating margin(Million yen)
1,000

2020

Automotive Textile andTraffic Facilities

Operating income(For each FY ended May 31)

-192

3.0

-50

2.0
-100

1,000

1.0
-200

0
2020

2021

2022

2023

2024

2.0

0
2020

2021

2022

2023

2024

2020

2021

2022

2023

2024

* The above data for the fiscal year ending May 2023 are the forecast figures for consolidated financial results that were disclosed on July 15, 2022. The data for the fiscal year
ending May 2024 are the figures that were planned at the time of formulation of the Medium- to Long-term Management Targets and disclosed on July 13, 2021.

15

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 2022

16

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Strategies by Segment

Interior Fittings
Review and Future Prospects by the Officer in Charge

Business Details
Wholesale of interior textiles for commercial use (in Japan and overseas), interior finishing work (curtains, carpets, wallpaper, plush
hand-woven curtains, hand-woven carpets and hooked rugs, etc.), wholesale of household interior textile products, EC business, store
design and construction (Space Design Business), sales of curtains and other optional items, and production and sales of arts and crafts

Major Products

Despite difficult market conditions, we achieved both sales
and profit growth in FY2022.
Norihisa Murase
We will expand the lineups of
Director
Division Manager
eco-friendly products.
Interior Textile Business Headquarters

Review of FY Ended May 2022 (Results and Future Challenges)
Carpet tiles

AVANCERA FLOOR

Doncho (plush hand-woven curtains

Rugs and mats

Curtains

Wallpaper

Dantsu (high-class hand-woventhat separate a stage from the auditorium) carpets and hooked rugs)

Nishijin brocade fabricCoin purses and card holders

Fusuma paper (paper for sliding doors)

SWOT Analysis
Strengths

Weaknesses

Capability for developing eco-friendly products and highly
functional products and the system of supplying these products● Diversified functions as a manufacturer, wholesaler, and constructor● Capability for planning, designing and coordination of the entire
room space● Capability for manufacture and development of traditional
craftwork through preservation of traditional techniques● Sales capability through cooperation with other businesses●●●

Low brand awarenessDecreased demands for carpets, the mainstay product of thissegment

Opportunities

Threats

Increased demand for environmentally friendly products
Growing interest in interior materials due to lifestyle changes● Increased demand for design and proposals for the entire room
space due to diversification of work environments

Reduction in the interiors market scale
Decreased number of new housing starts● Soaring prices of raw materials due to high crude oil prices, etc.
● Unstable supply of raw materials due to fewer supply chains

●

●

●

●

Companies Engaged in the Business
Suminoe Textile Co., Ltd., SUMINOE Co., Ltd., RUNON CO., LTD. , Suminoe Logistics Co., Ltd., TANGO TEXTILE Co., Ltd., Suminoe WorksCo., Ltd., Sewing Hyogo Co., Ltd., CPO Co., Ltd., PRETERIOR-TEXTILE Inc., Kyoto Traditional Art and Craft Factory of Suminoe Textile
Co., Ltd., Suminoe Techno Co., Ltd.

Strategies and Measures and Progress Assessment for FY Ended May 2022
Strategies and measures

17

Progress

Strategies and measures

Progress

Expand lineups of environmentally friendly products andincrease sales of these products.

○

Reduce inventory levels.

○

Commercialize and launch anti-virus wallpapers.

○

Strengthen directly operated EC business.

○

Enhance transmission and penetration of our brand image.

△

Simplify delivery.

×

Develop new products for housing.

△

Suminoe Textile Group Integrated Report 2022

In the first year of the SGW, the COVID-19 pandemic persisted as in
the previous fiscal year ended May 2021. To address the pandemic,
the Japanese government implemented and extended the state of
emergency measures and semi-emergency measures, which had asignificant impact on the business results of the Interior Fittingssegment. Nevertheless, this segment achieved both sales and profit
growth in FY2022, primarily driven by robust sales of wall coverings.
Another contributing factor was that sales of commercial carpets
were mostly unchanged from the previous year despite difficult
market conditions. In the fiscal year under review, we focused on
expansion of our market share by enhancing lineups ofenvironmentally friendly products and establishing the Space
Design Business. Notably, ECOS®, eco-friendly carpet tiles under thehorizontal recycling system, steadily penetrated the market,
encouraged by growing environmental awareness. In addition, in
cooperation with relevant divisions, we sold eco-friendly products,
such as ECOS®, and functional products to existing customers of theAutomotive Textiles and Traffic Facilities segment. In this manner,
we successfully developed new markets by leveraging thestrengths unique to the Group, which operates in multiple businessfields.
On the other hand, our brand image has not sufficiently beentransmitted. Raising awareness of the SUMINOE brand is achallenge to be addressed in the future. We will strengthenbranding by improving our website and by other means in the next
fiscal year and onward.

Future Prospects (Toward Achieving the SGW 2023)
As in FY2022, in order to increase revenue, we will work to expand
sales of environmentally friendly products and various functional
products while promoting the Space Design Business, aiming to
win more orders for designing of the entire room space. We alsoplan to develop higher-spec, luxurious products and expand into
the B-to-C market, capitalizing on the sales capabilities of
PRETERIOR-TEXTILE Inc., which joined the Group in January 2022.
Improving the profitability is also a major challenge for us.
Currently, prices of raw materials of carpets for general household
and commercial use, curtains, wallpaper and other all products arerising. I will conduct business management based on the idea thatthe most important point is selling products at reasonable prices. In

addition, in cooperation with the Development Department, we
will strive to improve the efficiency of transportation, secure stablesupply and flexibly respond to customer needs so as to enhance thecompetitiveness of this segment.
In the Interior Fittings segment, we will continue to work on
the development of products unique to the Suminoe Textile Group,in keeping with its development philosophy of “KKR+A (Kenko[Health], Kankyo [Environment], Recycling and Amenity).” In sodoing, we will contribute to the realization of a sustainable society
and work to better operate a business that constitutes a basis of theGroup.

ECOS® series winning two major prizes in the 4th EcoPro Awards and the 22nd Green Purchasing Award
The ECOS® series, eco-friendly carpet tiles under the horizontal
recycling system, won the Economy, Trade and Industry
Minister’s Prize in the 4th EcoPro Awards, as an advanced
product full of originality. The EcoPro Award program honors
practices that contribute to the realization of a carbon-freesociety and circular economy. Moreover, ECOS® received theGrand Prize in the plastic resource recycling special category of
the 22nd Green Purchasing Award, which commends products
and services with excellent environmental friendliness. The prize

was presented to ECOS® in recognition of its features, such as
using waste carpet tiles as recycled materials and achieving
reduction in water usage, electricity usage and wastewater
during the production process.

Details of
Product introduction
winning awards
video(Japanese only)

Suminoe Textile Group Integrated Report 2022

18

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Strategies by Segment

Automotive Textiles and Traffic Facilities (Automotive Textiles)
Review and Future Prospects by the Officer in Charge

Business Details
Development, production and sales of automotive interior products (ceiling materials, seat covering materials, floor carpets, luggage
compartment, car mats, and other interior products in general), automotive exterior textile products (wheel houses, engine covers, andother textile products). Our products are supplied to all Japanese automobile manufacturers.

Major Products
Door trim
Luggagecompartment

Ceiling material
Seat covering materials
Seat backSun visor

Automotive Textiles Business Headquarters
GRACE CORD®

Review of FY Ended May 2022 (Results and Future Challenges)

Floor carpet
Wheel house

Aiming to increase profits and market share, by expanding
sales of the Company’s proprietary products andstrengthening the decorative
Toshiro Maruyama
Director
fabric business
Division Manager

Car matSeat covering materials

Floor carpet

Car mat

SWOT Analysis
Strengths

Weaknesses

Capability for total coordination of automotive interior products
Global manufacturing system that enables stable quality and supply● Strong global supply chain● Capability for development and proposals of new materials throughintegration of technologies developed in multiple businesses●●

Insufficient consolidation of technologies and expertisepossessed by overseas operation sites● Capability to deal with price fluctuations caused by external
factors●

Threats

Response to the automotive industry that is the age of transformation represented by CASE
● Increased demand for environmentally friendly products● Increased demand for textile-based products that are lightweightand excel in noise-absorbing performance

In recent years, the Group’s environmentally friendly products
have attracted increasing attention from various automakers. These
car manufactures have frequently adopted our fabric products
using e.colore®, a processing technology that substantially reduces
the volume of dyeing solution required during the dyeing process
by effectively interweaving a solution-dyed yarn* with base fabricyarn. Such products enjoy high popularity among our customers.
Although this technology has not been sufficiently applied tooverseas production sites, we are aware that products using
e.colore® will act as a touchstone for the future growth.
* Solution-dyed yarn: Yarn that is pre-colored by adding pigments in the stage
where raw materials are heat-melted.

Future Prospects (Toward Achieving the SGW 2023)

Opportunities●

In the first year of the SGW, Japanese automobile manufacturessuspended operations one after another for several reasons,
including the prolonged global shortage of semiconductors,
component supply shortfall in Southeast Asia caused by the spreadof COVID-19, and lockdowns mainly in Shanghai. Under suchsituations, both net sales and operating income of the Automotive
Textile business fell significantly below the planned figures.
However, by focusing on cost saving, cost reduction and quality
improvement measures, we were able to minimize the impact of adecline in sales and inflated raw material prices. We also placedemphasis on the development of products that are expected to be
profitable in the future and on activities to propose these products.

Decrease in the number of domestically produced automobiles
due to a declining birthrate and aging population and young
people’s alienation from cars
● Intensified price competition● New entry of overseas manufacturers that produce automotive
interior textiles and seat covering materials into the market●

Companies Engaged in the Business
Suminoe Textile Co., Ltd., Suminoe Logistics Co., Ltd., Suminoe Teijin Techno Co., Ltd., Teijin Tecloth Ltd., Owari Seisen Co., Ltd.,
Suminoe Techno Co., Ltd., Suminoe Textile of America Corporation, Bondtex, Inc., Suminoe Textile de Mexico, S.A. de C.V., SPM
Automotive Textile Co., Ltd. Suzhou Suminoe Koide Automotive Accessories Co., Ltd., Suminoe Textile Shanghai Co., Ltd., T.C.H.
Suminoe Co., Ltd., Suminoe Koide (Thailand) Co., Ltd., PT. Sinar Suminoe Indonesia, PT. Suminoe Surya Techno, Suminoe Teijin
Techno Krishna India Pvt. Ltd.

The key to achieving the SGW is the seat fabric embroidery
techniques, which we will begin to provide in the second year of
the Three-year Consolidated Income and Expenditure Plan. As partof the decorative fabric business, which offers seat fabrics accented
with embroideries, three subsidiaries in China will newly start toprocure, manufacture and sell these products. We will strengthen
the decorative fabric business while expanding sales of Grace
Code®, the Group’s proprietary narrow woven fabric that is currently
in production, aiming to increase profits and market share.
In Indonesia, we have already established a system for local
procurement and production in order to respond to safeguard
measures. In North and Central America, we are working to optimize
the balance of production at three manufacturing subsidiaries while
undertaking a concrete review of the production system to improve
profitability of the Company’s subsidiary in the United States. In

Japan, the Group plans to make the Shiga Factory of Suminoe
Techno Co., Ltd. dedicated to production of automotive textiles so as
to augment our production capacity, which will lead to an increase insales. At the same time, we will enhance the Group’s competitivenessthrough cost reduction by reducing personnel expenses andlogistics costs and by improving production efficiency.
It is expected that the price competition of automotive textiles
will intensify in the future. I believe, however, that, in this segment,
the Company can achieve growth that exceeds the market scale
expansion by improving profitability through the development of
eco-friendly products, high value-added products, such as productswith antibacterial and anti-viral features, and products producedwith less man-hours. The Company will expand its business in awide range of product areas, including synthetic leather and newfilm products, beyond the existing textile products.

Promoting the development of and increasing order receipts for environmentally friendly products
Strategies and Measures and Progress Assessment for FY Ended May 2022

19

Strategies and measures

Progress

Development, sales promotion and effective useof environmentally friendly products○

Development of products, focusing on “new parts” and“production with less man-hours” as key words△

Development of interior materials fornext-generation vehicles
Cost reduction through the optimization ofmaterial procurement△

Development of fabric materials using new production
methods
Development in accordance with the situations andissues of each global operation site○

Horizontal development to overseas markets△

Suminoe Textile Group Integrated Report 2022△

Strategies and measures

Progress△

We have developed “e.colore®” with the aim of reducing thevolume of dyeing solution required and water usage. Our textile
products using e.colore® were adopted as a seat covering
material for the Alto (launched in 2021) by Suzuki Motor
Corporation and for the Move Canbus (launched in 2022) by
Daihatsu Motor Co., Ltd.
Another seat covering material the Group has developed
uses スミトロン® (SUMITRON) polyester yarn made fromrecycled PET bottles. We have also created a ceiling material
with less environmental impact. This is a ceiling covering
material that uses no polyurethane,unlike the conventional fabric ceilingmaterials that are made bycombining a fabric covering andpolyurethane.
Alto of Suzuki Motor Corporation

Suminoe Textile Group Integrated Report 2022

20

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Strategies by Segment

Automotive Textiles and Traffic Facilities (Traffic Facilities)
Review and Future Prospects by the Officer in Charge

Business Details
Production and sales of interior materials mainly for trains and buses (seat coverings, wall materials, curtains, flooring materials, seatcushion materials, etc.) We have supplied our products to a variety of customers. For trains, these customers include JR, private railways andpublicly operated transportation services. Our products have also been used in pickup buses, route buses and sightseeing buses.

Major Products

Striving to turn the business around by promoting
products that meet the needs during the COVID-19
pandemic and expanding our market channels Sadahiro Seto
Senior Operating Officer
Division Manager, Traffic Facilities Business Headquarters

Review of FY Ended May 2022 (Results and Future Challenges)

Moquette (woven velour), headrest
covers, curtains

Floor signage film

Carpets

In the first year of the SGW, due to the negative impact of the
prolonged COVID-19 pandemic, the passenger demand in Japan
did not recover, so many transportation operators, who are ourcustomers, were caught in a difficult predicament. Since thesecustomers reduced investment in updating and maintaining train
seats and placing orders for new sightseeing buses, sales
significantly decreased in the Traffic Facilities business. In themeantime, our antiviral seat covering materials were adopted formany public transportation facilities because these products canprovide users of these facilities with peace of mind. When the

SUMICUBE®, knit fabric

SWOT Analysis
Strengths

Weaknesses

The Industry’s top market share percentage
Capability to offer total proposals for interior materials for public
transportation systems● Environmentally friendly products with excellent safety
performance

Aging facilities of manufacturing factories
Aging human resources● Significant impact of the decline in the traffic industry● Insufficient track records of delivery to overseas customers

●

●

●

●

Opportunities

Future Prospects (Toward Achieving the SGW 2023)

Threats

Increase in travelers and foreign visitors to Japan in the post-pandemic era● Increase in users of public transportation facilities owing topractical application of MaaS
● Increased demand for products processed with antibacterial andanti-virus processing●

Decrease in users of public transportation facilities owing to
declining birthrate and aging population● Decrease in the number of trains/buses owned because of
decreased business trips and reduced rush-hours due to the
spread of teleworking and staggered working hours● Soaring materials prices●

Companies Engaged in the Business
Suminoe Textile Co., Ltd., Marunaka Souei Co., Ltd., Seki Textile Co., Ltd., Teijin Tecloth Ltd., Owari Seisen Co., Ltd., Suminoe TechnoCo., Ltd.
Strategies and Measures and Progress Assessment for FY Ended May 2022
Strategies and measures

Progress

Increase order receipts for renovation and replacement work, both of which show signs of recovery.

×

Develop and increase sales of new products.

○

Develop environmentally friendly fabrics.

△

Increase market shares.

△

Propose and receive orders for SUMICUBE® (seat cushion material) with a new tactile impression.

△

In 1896, the Company succeeded in manufacturing moquette, apile fabric for seat coverings, as the first of its kind in Japan. Since
then, we have been maintaining the top market share in the area ofseat coverings used in public transportation facilities. Seat covering
materials account for roughly 50% of sales in this business segment.
The Suminoe Textile Group will continue to pursue design andfunctionality that satisfy customer requirements, aiming to enhance
its brand value.
It is estimated that in the post-pandemic era, the passenger
demand in society as a whole will recover only up to 80% of

Suminoe Textile Group Integrated Report 2022

pre-pandemic levels. To achieve the SGW, we will focus efforts topromote the further spread of antiviral products and to enhancefunctionality of SUMICUBE® and floor signage film while bringing
their prices down, thereby increasing order intake. Moreover, we
will reinforce cooperation with other business segments topromote sales of seat upholstery materials for theaters and halls.
Through these endeavors, the Group will increase customer
acquisition by leveraging its existing know-how, which will enable
the business to turn around.

Our interior materials adopted for the Nishi Kyushu Shinkansen “Kamome” train operated by JR Kyushu
Kyushu Railway Company (JR Kyushu) started operation of the
Nishi Kyushu Shinkansen “Kamome” bullet train, which travels
between Takeo Spa in Saga and Nagasaki, on September 23,
2022. The Kamome is a six-car train, and a total of four trains
were built. The Company delivered products processed with
anti-virus processing for the reserved seats’ woven fabriccovering and for the roll curtains installed in train cars forExternal appearance of the Kamome

21

passenger demand recovers in the future, the anti-viral processing
will be a key technology capable of imparting a sense of security topeople. We are therefore planning to strengthen proposals for theseproducts in accordance with the increase in demand.
On the other hand, a long-term loss of demand in the traffic
industry has had an enormous impact on this business. We will
strive to turn the business around, by venturing into andestablishing a new business field where our existing technologies
and products can be utilized, while securing a competitive
advantage of our mainstay products.

reserved and unreserved seats. We also delivered SUMICUBE®
cushion material for the backrest of the reserved andunreserved seats. To meet the expected demand for sightseeing
tourism in the post-pandemic age, we will continue to promoteanti-viral processing for fabrics and help railroad operators todevelop their rolling stock in the future.

Reserved seats in Car No. 3: Karakusa (Beige)

Reserved seats in Car No. 1: Kikudaigara (Gray)
Reserved seats in Car No. 2: Shishigara (Green)

Suminoe Textile Group Integrated Report 2022

22

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Strategies by Segment

Functional Materials
Review and Future Prospects by the Officer in Charge

Business Details
Moving beyond its conventional business segments, the Group has been active in advancing into new business fields, handling a wide rangeof products, including textiles, non-textiles, interior materials, household appliances and food. Household appliance business: Development,
production and sales of fabric-coated heating products, Functional materials business: Development, production and sales of floor materials
for bathrooms, deodorizing products, interior materials for aircraft, water shielding/thermal insulation sheets, and food products

Strive to enlarge the business scale and improve
profitability by promoting visualization of each business
Masaya Fukuoka

Major Products

Operating Officer
Division Manager, Functional Materials Business Headquarters

Review of FY Ended May 2022 (Results and Future Challenges)
Electric carpets

Deodorant air filters for air purifier

Rooftile side“Kakidanomi” supplement containing
persimmon (kaki) polyphenol

Floor materials for bathrooms

Interior materials for aircraft* CLOTHCABIN is a
registered trademarkof TEIJIN FRONTIER
CO., LTD.

Heatinsulating
property Roof board side

Roofing materials

The Tispa® Series “Real Odor Deodorization
without Disguising with a Scent”

CLOTHCABIN®

SWOT Analysis
Strengths

Weaknesses

Functional materials and functional treatment technologies thatare unique to the Group● Eco-friendly technology capability● Organizational structure to realize high-quality products andhigh-level development●

OEM business that is vulnerable to demand fluctuations
Household appliances only limited to fiber-coated types of products● Delayed brand penetration● Dispersion of capabilities due to business operations in multiple
fields●Threats

Trend toward a decarbonized society, a declining birthrate andaging population, increasing health and hygiene awareness, andthe emergence of new needs due to external environmental
changes, such as digital transformation (DX)● New demand from existing customers in many fields● Discovering overseas demand, with a footing in overseas affiliates

Unexpected changes in the external environments caused by apandemic and other events● Market maturity, lowering of product prices, intensified pricecompetition● Changes in consumer trends due to a declining birthrate andaging population and other factors● Changes in situations of the countries where overseas operationsites are located●Companies Engaged in the Business
Suminoe Textile Co., Ltd., Suminoe Techno Co., Ltd., Suminoe Textile Vietnam Co., Ltd., Suzhou Suminoe Textiles Co., Ltd., Owari
Seisen Co., Ltd.
Strategies and Measures and Progress Assessment for FY Ended May 2022
Strategies and measures
Consolidate overseas factories of fabric-coated heating products,
optimize the production and supply systems for these products,
and strengthen the business capability.
Promote development of new products by using functional products
and processing technologies and increase sales of these products.
Develop and increase sales of products made by functionallyprocessing technologies, such as deodorant treatment andanti-virus processing technology.
Maintain and promote appropriate quality management andproduct supply systems in accordance with the JIS Q 9100
quality management standard for the aerospace industry.

23

Suminoe Textile Group Integrated Report 2022

Progress

Strategies and measures

Progress△

Develop new health foods and everyday items using
persimmon polyphenols and other functional natural
substances and expand sales of these products.

△△

Promote new commercialization utilizing smart textiles.

△△

Cooperate with the technology development sections tostrengthen the capability of sales and development.

△○

forming technologies remained strong, making it more importantfor us to supply these products. In the area of functional processing,
mainly deodorizing treatment, efforts are under way to develop
effective use and new applications of these technologies in various
fields, including household appliances, healthcare and nursing,materials, and sundries. In the fiscal year ended May 2022 underreview, we launched a new product, SUMINOE FRESHTM Filter,
which incorporates the Group’s unique antivirus technology,トリプ
ルフレッシュ®デオ (TRIPLE FRESH DEO). In all areas, we will remaincommitted to enhancing quality and the supply capability and todevelop and promote new businesses and products that capitalize
on our functional materials and processing technologies.

●

Opportunities●

In the first year of the SGW, the Functional Materials segment fell
below its performance targets since both domestic and overseas
operation sites were adversely affected by the impact of soaring
raw material prices, procurement problems, increase in importcosts, and other factors which were triggered by the COVID-19
pandemic.
In the household appliance business, although the Company
has completed the consolidation of overseas factories, it is urgently
necessary to address various issues due to the changes in theexternal environment. In the functional materials area in the
Functional Materials segment, despite the pandemic, demand forour bathroom flooring materials using olefin compounding andFuture Prospects (Toward Achieving the SGW 2023)
Toward achieving the SGW, based on the results of the FY2022
review, we will promote visualization of each business area in thissegment and tackle challenges in order to enlarge the businessscale and improve profitability. We have been vigorous indeveloping applications and increasing product lineups of thenext-generation fibers and textile fabrics that are representative ofsmart textiles and of supplements and other functional items using
natural ingredients. The Group’s products under development

include a sensor system making use of a water-wetting detection
fabric.
Going forward, the Group will intensify its efforts to promote
development activities for value creation, strengthen sales anddevelopment capabilities, and cultivate human resources of thenext generation, aligning itself with its development philosophy“KKR+A” (Kenko [Health], Kankyo [Environment], Recycling andAmenity).

Consolidation of overseas factories of fabric-coated heating products, aiming to strengthen our business capabilities
The Group consolidated overseas factories in order to optimize
its production and supply systems for electric carpets and otherfabric-coated heating products and to strengthen its businesscapabilities. As a result, Suzhou Suminoe Textiles Co., Ltd., whichstarted operations in 2003, is now in charge of procurement,
sales, quality management and development of fabric-coatedheating products and deodorizing filters, striving to enhancethe value of this business. Another overseas factory, Suminoe
Textile Vietnam Co., Ltd., commenced production in 2020.
Although there was a delay in developing its production
function due to the COVID-19 pandemic, the Vietnamese
subsidiary became the Group’s main manufacturing factory for
fabric-coated heating products in 2022. We also plan to produce
main components in-house in 2023. With these two operation

bases overseas, the Group diversifies regional risks. We will work
to secure current orders for and improve the profitability offabric-coated heating products through the coordinated efforts
of factories in Japan, China, and Vietnam. At the same time, theGroup will promote the development of products that meetmarket demand, seeking to expand sales channels in Japan andabroad and increase product lineups.

Suminoe Textile Vietnam Co., Ltd.

Suzhou Suminoe Textiles Co., Ltd.

Suminoe Textile Group Integrated Report 2022

24

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Research and Development Strategies

Fundamental Development Philosophy
Kenko(Health)Kankyo(Environment) Recycling

R&D Challenges and Progress Assessment for FY Ended May 2022

AmenityStrategies

Under its fundamental development philosophy “KKR+A (Kenko [Health], Kankyo [Environment], Recycling and Amenity),” theSuminoe Textile Group has been working on research and development of technology and products that help resolve
environmental issues and contribute to society while striving to sow seeds for industry-academia collaboration. We will continue
our efforts to develop new technologies and products that are friendly to people and the environment, based on “KKR+A” and coretechnologies that the Group has cultivated for many years.

Progress

Strategies

Progress

Enhance functionality of bathroom interior products.

○

Basic research using bioplastics△

Improve floor signage film.

○

Basic research for extracting beneficial substancesfrom woody biomass△

Smart textiles: Efforts for commercialization of water-wetting
detection systems and power generating fibers△

Develop and commercialize chemicals for multifunctional
processing.
Develop antibacterial and anti-virus technologies andevaluation techniques.
Develop new products using raw materials derived
from nature.

△○△

Core Technologies
Textile and knitting
production technology

Coating technology

Recycled polyester
yarn-making technology

Lamination technology

Functionalization technology

Hard cotton processing technology

Expectation for Smart Textiles

Research and Development System
Development teams of each business segment

Development Department
Technology
Development Center(research & development)

Suminoe Techno Co., Ltd.
(technology development)

The Group carries out research and development basedin the Nara Factory, through cooperation between theDevelopment Department, which conducts researchand development of core technologies, and thedevelopment teams of respective business segments.
In December 2021, we reorganized the Nara Factory(see p27). On that occasion, the Technology
Development Center building was completed, as our
new R&D facility with state-of-the-art assessment
instruments and R&D equipment.

Demonstrating synergy effects

Interior Fittings

Automotive Textiles

Traffic Facilities

Functional Materials

R&D expenses

Number of patents■ Number of domestic patent applications■ Number of patents held

(Million yen)
1,200

150

1,117
948

984

800
400

139

120

127

124

132

135

The Group moves forward with the development of smart textiles
featuring new functions that cannot be found in general textiles.
For example, the Group’s unique technology is applied to
power-generating fiber/textile-shaped photovoltaic cells, which
generate electric power when illuminated by light. As
power-generating components with high flexibility andbreathability, their expected applications include power sources for
IoT equipment and wearable devices. In addition, ourwater-wetting detection system is designed to make a reaction
when a wet condition is detected. Since this system can be formed
into various shapes and sizes, it is assumed to be used at
nursing-care facilities, construction sites, and the like.
As mentioned above, we are developing products having
functions of collecting and communicating information byembedding a sensor or a power-generating element into textiles. It
is expected that these smart textiles will enable us to develop
business in new areas through collaboration with other industries,
including electrical and electronic, IT, healthcare, nursing,environmental, and social science.

90
60

268

254

30

23

18

14

13

10

2018

2019

2020

2021

2022

0

0
2018

2019

2020

2021

2022

Accelerating the development of new products

Comments on Research and Development Strategies by the Officer in Charge of Researchand Development

Aiming to ensure sustainable growth of
the Suminoe Textile Group throughcontribution to resolving social Issues
The Development Department, which is tasked with R&D activities, aims
to establish a new business model for achieving sustainable growth bycreating value that helps resolve social issues, under the slogan of“KKR+A.” To this end, I believe that it is important to produce new andunique technologies that will sow the seeds for sustainable growth,
leveraging our dual strengths: functional enhancement technologies
and evaluation technologies for textile and resin products. We will also
refine our production technologies through the effective use of the
one-of-the-kind facilities possessed by Suminoe Techno Co., Ltd., which

25

Suminoe Textile Group Integrated Report 2022

Eiichiro Kimura
Director
General Manager, Development Department

is in charge of production.
In May 2022, the Nara Factory reorganization project wascompleted. Removal of dyeing facilities and a wastewater treatment
plant has enabled the Factory to significantly reduce environmental
impact during production. We will step up our efforts to reduce waste,
introduce renewable energy, and utilize natural and recycled materials,
in order to evolve the Nara Factory from a conventional “manufacturingbase to produce eco-friendly products” into a “manufacturing base thatcreates a rich environment.”

Suminoe Textile Group Integrated Report 2022

26

Value Creation and Growth Strategies in Line with the Medium- to Long-term Management Targets
Feature: Reorganization of the Nara FactoryStrengthening Functionality as
the Mother Plant toFurther Promote Value
Creation

The Nara Factory of the Group started operations in April 1971,
when Japan was in the period of high economic growth. The
Factory served as the center of tufted carpet manufacturing, thelargest of its kind in Asia at that time. Subsequently, as themarket for tufted carpets began to shrink, in 1980 the Nara
Factory became the first in Japan to produce carpet tiles, with aneye toward the future. In 2011, the Group developed the ECOS®
series, eco-friendly carpet tiles under the horizontal recycling
system, inaugurating a new era in the utilization of waste carpet
tiles, which previously had to be dumped in landfills.
The Nara Factory has evolved as the mother plant of theGroup. After about half a century had passed since its
establishment, we decided to update the Factory to better
adapt to the times, aiming to achieve the Group’s further
growth and development. In 2019, we launched a full-scale
reform scheme entitled “the Nara Factory Reorganization
Project. Given that the project was completed in May 2022, theNara Factory has been in operation with a greater value creation
capability and stronger competitiveness.

Endeavoring to enhance brand value in a new environment through technologies

Details of the Nara Factory Reorganization Project

I am engaged in creation of new technologies and products and improvement of existing technologies and1．
Improve value creation capability

products in a section called the “Technology Development Center,” whose duty is to conduct R&D activities. On the■ Strengthen the roles of the Factory as the mother plant: crate

new products, nurture engineers, and supply these products
and engineers to the Suminoe Textile Group.
■ Strengthen R&D and product development functions
through cooperation between engineers of different
departments. (Construct a Technology Development Center)2．
Improve productivity■ Concentrate production facilities (so that the Nara Factory

specializes mainly in Interior Fittings products, and the Shiga
Factory in Automotive Textiles products).
■ Further strengthen the foundation as the manufacturingbase for ECOS®.
■ Upgrade the Factory into a high-efficient logistics base(create a functional work flow from production to shipping)and reduce product inventories.

occasion of the Nara Factory reorganization, a Technology Development Center building was constructed. I think
this is very important in facilitating forward-looking technology and product development. This is because

Yoshinari
MiyamuraGroup Leader,
Functional Processing
Development Group
Development Section
Technology Development
CenterDevelopment Department
Suminoe Textile Co., Ltd.

technologies are the starting point for creating new functions and products, which will be conducive to solving
problems in our everyday life and industries.
The new building uses a hot-desking system, which has provided me with many more opportunities to talkwith my supervisors and coworkers and to enjoy lively exchange with members of other departments. In this newenvironment that encourages flexible thinking, I wish to improve the brand value of the Group throughtechnologies.

Vigorous exchange of views among engineers, stimulating the improvement of
our technological capabilities

3．
Measures to reduce environmental impact■ Remove dyeing facilities and a wastewater treatment plant.

4．
Sell off unnecessary production facilities and idle
properties that account for one third of the total site area

As a result of the Nara Factory reorganization, we are now working in an open-office space, which is easy to getaround and allows us to hold an instant meeting anytime we want, bringing together relevant members. In
addition, work efficiency has drastically increased since the Technology Development Center building was

Witnessing the effects of the reorganization project that boldly renovatedthe Nara Factory

Hiroaki Ishii
Trustee, Nara Factory
General Manager,
Production Department
Suminoe Techno Co., Ltd.

27

To reorganize the Nara Factory, which has a history of more than 50 years, it was necessary to select what should bemaintained and what should be changed, based on the fundamental assumption of creating an environment where
employees can work happily and safely. What should we do with technologies and facilities that had been handed down forgenerations? In what way should we evolve the Factory as an eco-friendly production site? In quest of the answers to suchquestions, we held discussions on a truly wide range of subjects, including business selection and concentration, the flow of
products, and a fusion of technologies.
The biggest decision we made was to completely withdraw from continuous dyeing processing, for which we had
excellent technology. We decided to use solution-dyed yarn in manufacturing all carpets and remove the wastewater
treatment plant. These measures have brought about significant effects in reducing environmental impact. On the other
hand, the dyeing processing technologies we had cultivated until then are now utilized for the filter business.
At the center of the reorganization project was efficiency improvement achieved by consolidating production, logistics
and technologies. Taking carpet production as an example, we consolidated production facilities for each process that had
been scattered throughout the vast site before. This consolidation has enabled us to dramatically improve efficiency intransfer and storage of half-finished products. On the production front, the construction of a Technology Development Centerbuilding has brought technology development members from Suminoe Textile Co., Ltd. and from Suminoe Techno Co., Ltd.
close to each other in a variety of ways. I feel that they are making positive progress while merging technologies in which eachmember has expertise, toward resolving issues at hand and developing new technologies for the future.
It is true that this reorganization project entailed a large investment. However, I am sure that the Nara Factory will
henceforth produce excellent products, technologies, services and human resources, which will be most advanced not onlyin the Suminoe Textile Group but also in society as a whole.

Suminoe Textile Group Integrated Report 2022

Masanori
Nishiguchi
Manager
Nara Product Development
SectionTechnology Development
Department
Suminoe Techno Co., Ltd.

constructed adjacently to the office, and test instruments that were previously dispersed across the Nara Factory
site are now concentrated within the new building.
I am in charge of developing new products, making effective use of these facilities. I believe that improving
our technological capabilities will create a better future for our company. It will not only encourage the proposals
for new products but also lead to improvements in the Factory’s facilities and production methods. Also, thereorganization has promoted vigorous exchanges of views transcending the departmental boundaries,
stimulating the improvement of our technological capabilities.

Feeling employees are highly motivated by the new work environment
I am mainly responsible for storage and management of products produced at the Factory, as well as transaction
with transportation companies to transport products nationwide after receiving orders from sales companies. As
part of the reorganization of the Nara Factory, a multi-story warehouse was constructed, greatly enhancing logistics
functions. Previously, since the Factory had a tent warehouse, operation in the shipping yard was largely affected

Hiroaki Okada
Director
Nara Center
Suminoe Logistics Co., Ltd.

by weather conditions. So we had great difficulty each time the region was hit by a typhoon or heavy rain. However,
now we are free from such difficulties and concerns.
It is about half a year since the renovation was completed. The new work environment with the face-liftedbuildings has highly motivated our employees, which I feel is visible in their facial expressions. In the future, I willcontinue to maintain this wonderful environment while watching over all the employees working at the Nara
Factory in order to ensure that they can enjoy their jobs.

Suminoe Textile Group Integrated Report 2022

28

Value Creation and Growth Strategies in Line with Medium- to Long-term Management Targets
Message from the Director in Charge of Finance

Aiming at an optimal capital
structure to lead to
Hiroaki Usugi
new growth(Million yen)
6,000

2,000

3,311

Efforts to Meet the Criteria for Remaining Listed

an optimal capital structure

4,167
3,413

In improving the financial structure, we focus on the D/E ratio. We
have incorporated the improvement plan in the SGW, aiming at about

3,274
375
-816
2018

2019

2020

2021

2022

0.5 times in fiscal year ending May 2024. The D/E ratio for fiscal year
ended May 2022 was 0.67 times, about the same level as the previous
year, due to an increase in interest-bearing debt as a result of
temporary worsening of cash flows. We will make efforts, along with

M&A and investment for the next generation

the various measures to create cash flows, to reduce interest-bearing

maintain an optimal capital structure, which is necessary to realize

In response to the Tokyo Stock Exchange’s revision of the market

As for M&A, we acquired CPO Co., Ltd. in fiscal year ended May 2021

the strategies for growth. My role is also to support the initiatives tosegments, we selected the Prime Market. As of June 30, 2021, thedebt to achieve an optimal capital structure.

and PRETERIOR-TEXTILE Inc. in January 2022 to expand the Space

improve competitiveness of each Business Headquarters, such asrecord date of the market transition, the criteria “the market

Design Business in the Interior Fittings segment. By enhancing theInterest-bearing Debt
and D/E Ratio

reviewing operations and improving efficiency by using information

capitalization of tradable shares of at least 10 billion yen” and “thesynergetic effect between our existing interior business and thesesystems as well as developing educational and other new systems

average daily trading value of at least 20 million yen” had not been

two companies, we will expand our business domain.

for human resources development and utilization.

satisfied. However, as a result of the enhanced IR activities andRegarding capital investment, the reorganization of Narashareholder returns, the average daily trading value as of May 31,

Factory, a project we have been engaged in since fiscal year ended

2022 reached 39 million yen according to our estimate, and thus itmarketMay 2019, was completed in the fiscal year under review (→ p.27).
For the reorganization project, we made active investment in

Affected severely by the external environment, Automotive

capitalization of tradable shares was 5.86 billion yen as of May 31,

logistics facilities to substantially improve the storage capacity andTextiles and Traffic Facilities segment failed to achieve the targets

2022, failing to reach the target. According to our calculation based

logistics efficiency of the Nara Factory. Based on this, we will

The fiscal year ended May 2022, the first year of the Medium- toon the list of all shareholders as of May 31, 2022, including those of

integrate our logistics bases, which were dispersedly located, at theLong-term

WAYshares held for the purpose of net investment, the market

Ensuring stable dividend payment andNara Factory, thereby achieving further improved logistics

2022-2024-2027,” marked net sales of 81,713 million yen (5.5% lower

capitalization of tradable shares is 6.75 billion yen and the ratio of

introducing a shareholder special benefit program

efficiency and cost reduction. As for investment in restructuring ofthan the plan), operating income of 110 million yen (90.5% lower),

tradable shares is 47.8%. Moving forward, we will continue to

Our basic policy of shareholder returns is to ensure stable dividend

core

promotingordinary income of 950 million yen (29.6% lower), and profit

promote various efforts to satisfy the criteria for remaining listed by

payment to our shareholders and properly allocate the surplus,

reengineering of the production management system to improve

attributable to owners of parent of 281 million yen (54.6% lower),

May 31, 2024, such as the efforts to improve corporate value

taking into consideration the trends in business performance andefficiency in business operation through information sharing

failing to achieve all target figures in the plan, including ROE andthrough capital investment and M&A and increasing the number ofinvestment for business expansion. Starting from fiscal year ended

D/E ratio. This was due to the impact of mainly the production

tradable shares by implementing stock-related measures.

among departments of manufacturing, procurement and sales (→p.50) and of the accounting system mainly for management of

May 2022, we introduced a shareholder special benefit program to

Progress in Efforts toward Medium- to
Long-term Management Targets

Management

Targets “SUMINOE

satisfied

GROUP

the

criterion.

Meanwhile,

however,thereduction by automobile manufacturers and soaring raw material
prices and logistics costs on the Automotive Textiles and Traffic
Facilities segment despite results better than the plan in the Interior

systems,

we

have

been

simultaneously

receivables and payables to improve operations and realize timely

Cash Flow Management and Investment Strategies

response to regulatory revisions by electronification and sharing of

Fittings segment. In the fiscal year ending May 2023, although theCreating cash flows by increasing cash from operating

information (→ p.48).
For human resources, based on training through OJT,

severe external conditions are expected to continue, we will

activities and liquidating fixed assets

employees are provided with a combination of training programs,

accelerate efforts to “expand sales and build a foundation for

We proactively make various forms of investment to reinforce

including the level-based program offered at every promotion since

growth,” which is one of the Medium- to Long-term Management

existing businesses and expand the business fields. Under the SGW,

joining the company, next-generation leader training using

Targets, and aim to achieve the plan.

a total of 10 billion yen will be invested in three years from the fiscal

business schools, and training for skill improvement for all

year ended May 2022 to the year ending May 2024. To this end, we

employees. We will proactively create opportunities to develop andplace emphasis on the creation of cash flows and have set a target

utilize human resources in a well-balanced manner.

Results of the First Year of the Three-year Consolidated
Income and Expenditure Plan
2022

2023

2024

of securing free cash flows of 3 billion yen or more each year.
To create cash flows, we have been working to increase cash

Plan*

Results

Plan*

Plan*

Net sales (million yen)

86,48081,71390,36093,490Operating income(million yen)

1,160

110

2,520

3,300

keep the level of current assets, such as accounts receivable andOperating margin (%)

1.3

0.1

2.8

3.5

inventory, at an appropriate level and liquidate fixed assets byOrdinary income(million yen)
Profit attributable to ownersof parent (million yen)

1,350

950

2,730

3,530

selling securities and land, etc. In fiscal year ended May 2022, cash

620

281

1,280

1,960

ROE (%)

2.2

1.0

4.5

6.6

D/E ratio (times)

0.58

0.67

0.64

0.56

* Planned figures are as of the disclosure on July 13, 2021.

29

4,365

0
-2,000charge of formulation and execution of financial strategies to

3,519

Improve Financial Structure
Reducing interest-bearing debt to achieve

5,901
4,760

4,000

Managing Director
General Manager, Administration Headquarters
Suminoe Textile Co., Ltd.

As the General Manager of the Administration Headquarters, I am in■Operating cash flow
■Free cash flow

Changes in Cash Flows

Suminoe Textile Group Integrated Report 2022

from operating activities and set an operating margin of 5% orimpact of the production reduction by automobile manufacturers.
But we will secure cash by returning inventory to an appropriate
level as soon as possible.

22.120.1

20.3
18.6

20.8
18.9

0.72

0.67

0.67

2019

Aiming ataround 0.5
times(Times)
1.0
0.75
0.50
0.25
0

2020

2021

2022

2024

Shareholder Returns

enhance shareholder returns.

Changes in Dividends
(Yen)
80
60

70
50

40
20

70

70 (Planned)

2022

2023

35

0
2019

2020

2021

Strengthening Communication with Investors
Enhancing disclosure materials and proactive IR activities
To raise the level of our recognition and reliability both inside andOverview of Investment Plan

outside Japan, we are working to enhance investor relations (IR)Creating cash flow

activities. Our IR efforts include enhancing the contents of thehigher as a target in the SGW. Moreover, we will make efforts toflows worsened temporarily due to inventory increase under the(Billion yen)
25.0
20.0
19.718.5
15.0
10.0
0.61
5.0
0

■Including lease obligations ●D/E ratio■Excluding lease obligations

integrated report and various other information disclosure materials

Operating CF
Capital expenditure / M&A
Improving D/E ratio

and translation to English thereof, publication of paid analyst reports,
increasing individual meetings with institutional investors, andRestructuring the core systems

posting the proceedings of financial results briefings on our corporate· Selling securities· Selling land (Nara Factory of Suminoe
Techno Co., Ltd.)

Reorganization of offices andimprovement of logistics network

website to enhance information provision for individual investors.

Effective use of treasury stock

Profit returns to shareholders

Securitization of assets

We will continue to promote activities aimed at an optimal capital
structure, which will lead to new growth and improved corporate
value of our Group.

Suminoe Textile Group Integrated Report 2022

30

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Sustainability and ESG Initiatives

Basic Approach to Sustainability

Measures for ESG Initiatives

In the course of promoting ESG management, the Group formulated the Medium- to Long-term Management Targets “SUMINOEGROUP WAY 2022-2024-2027.” We believe that it is important to identify key sustainability issues to be focused on and address theseissues through its business operations. Based on this idea, we will promote business operations while flexibly accommodating changes
in the external environment surrounding the Group.

Formulation of the Basic Policy on Sustainability and Related Policies

In the non-financial area of the Medium- to Long-term Management Targets “SUMINOE GROUP WAY 2022-2024-2027,” the Group has
stipulated measures for ESG initiatives.
Purpose
Reduce CO2 emissions.

E

Improve workplaces for more safety
and security.

Basic Policy on Sustainability

S

Health Management Declaration

Health and Safety Policy

Basic Policy on Work-Life Balance

Basic Policy on Human
Resource Development

CSR Procurement Policy*

Basic Policy on Diversity andInclusion

Participation and cultivation ofhuman resources

Basic Policy on Product Safety
and Quality*

Omnidirectional communication

The Group holds CSR Promotion Committee meetings three times a year, under the Corporate Governance and CSR Promotion System(see p.45). At these meetings, the Committee members make decisions on the policies for activities related to CSR and sustainability,
deliberate on activity plans, and confirm their progress.

SDGs on Which the Suminoe Textile Group FocusesG

Enhance governance.

The Group has selected the following seven goals from among the 17 Sustainable Development Goals (SDGs) as priority targets on
which the Group focuses, in order to help resolve social sustainability issues through our business operations.

31

Make cities andhuman settlements
inclusive, safe, resilientand sustainable

Ensure sustainableconsumption andproduction patterns

Take urgent action tocombat climate change
and its impacts

Suminoe Textile Group Integrated Report 2022―

Each fiscal year

By FY2025――

Teleworking and off-peak commuting system―

P40

Support for life-work balance (work, childrearing
and nursing care)

FY2023 andonward―Each fiscal year

P40―

FY2024 andonward―Conduct training for the prevention of harassment.
Eliminate occupational accidents.

Build resilient infrastructure,promote inclusive andsustainable industrializationand foster innovation

P35

P40
P43

P39

Promote women’s participation.

―

Each fiscal year

P39
P39
P39

Each fiscal year

P41―

FY2023 andonward

P42―
Review of human resources management andevaluation systems
Dissemination of corporate philosophy andmanagement policy, and the progress will be shared.
Consider the timely disclosure of information and―transmit it.

FY2024 andonwardCareer self-declaration system
Job rotation

Contribution in cases of disasters

Each fiscal year

Each fiscal year

Restructure the core systems.

By May 2024―

Promote interactive in-house communication throughtop management’s frequent visits to workplaces.

―

―

P44
P44
P48
P48
P49

Continue to conduct compliance training.
Further disseminate “Corporate ethics hotline.”

―

P44
―

Support and donation for poverty and starvation―

P44

Communication between departments

Social contribution activities

Promote sustained, inclusive andsustainable economic growth,
full and productive employment,
and decent work for all

P39

Education for human resources (IT literacy, education―
for corresponding stages, etc.)

Initiatives for Promoting Sustainability

Ensure access toaffordable, reliable,
sustainable andmodern energy for all―

Participation of senior employees* To be established in 2023 and onward

Achieve genderequality and empower
all women and girls

P36

FY2024 andonwardEmploy foreign workers.

Suminoe Textile Group’s Second SUMINOE Environmental Declaration
Human Rights Policy*

Each fiscal year

Employ people with disabilities.

Sustainability-related Policies
E―

Paid leave by the hour, flex-time system

S

P35

Each fiscal year

Acquire “Certified Health & Productivity Management
Outstanding Organizations.”

Diversity and inclusion

Target period Evaluation period Reference page―

Increase volume of contribution to the reduction of
CO2 emissions through products.
Review, transmit, educate and disseminate
our human rights policy.

Framework of Basic Policy on Sustainability

The Suminoe Textile Group contributes to the realization of asustainable society by achieving sustainable growththrough sound, transparent management and businessactivities in harmony with society and the environment
while observing its Code of Conduct and Standards ofConduct, both of which are based on the Corporate
Philosophy.

Reduce CO2 emissions in the business activities.

Contribute to a decarbonized society. Develop and sell environmentally friendly products.

In June 2022, we formulated the Basic Policy on Sustainability, as well as Sustainability-Related Policies, which summarizes a variety ofenvironmental and social policies.
In the environmental aspect, in response to the growing climate change risks in recent years, the Suminoe Textile Groupestablished its Second SUMINOE Environmental Declaration in April 2022 by revising the Group’s “SUMINOE Environmental Declaration,”
which was formulated in 2009 based on the Interior Environment Improvement Declaration, announced in 1998. In the social aspect, weestablished policies regarding human resource development, diversity and inclusion, health management, and work-life balance, in
addition to the existing health and safety policy. With regard to the human rights policy, the Group is aware of the need to develop ahuman rights policy that includes a human rights due diligence process to identify risks of human rights violations in our businessactivities and to prevent and mitigate these risks. We plan to formulate a human rights policy in conjunction with the CSR procurement
policy in the future.
Going forward, we will continue to effectively implement various measures following the applicable policies, thereby further
strengthening ESG management, and accelerate initiatives to resolve all kinds of social issues.

Basic Policy on Sustainability

Measures (initiatives)

Each fiscal year

P49

Strengthen global risk management.

P50

BCP action planP50

CSR Plan
Focusing on our medium- and long-term “ideal corporate image,” we have formulated the Medium- to Long-termManagement Targets as well as the 3rd Medium-term CSR Plan (for 2021 to 2024), in which our key CSR issues are identified.
To address these issues, the Group is moving ahead with various initiatives. As for our CSR initiatives, the 3rd Medium-term
CSR Plan, and the results of CSR activities in fiscal 2022, please visit a webpage by scanning the 2D barcode on the right.

Suminoe Textile Group Integrated Report 2022

32

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Environment

E Environment
Kenko(Health)Kankyo(Environment) Recycling

AmenityWe, the Suminoe Textile Group, are continuing to work on environmental conservation activities, such as interior environment
improvement and utilization of recycled materials as well as decreasing our impact on the environment, with our fundamental
philosophy of “K - Kenko (Health),” “K- Kankyo (Environment),” “R – Recycling ,” and “A - Amenity: Comfort.”

Fundamental Environmental Philosophy
Recently, deterioration of the global environment has rapidly been progressing. It is a mission in common among human beings wholive on Earth to make efforts to preserve and improve the global environment and hand the beautiful earth down to our descendants.
With this recognition, the Suminoe Textile Group will create a comfortable and rich society with the cooperation of all the employees
positively tackling environmental preservation activities.

Second SUMINOE Environmental Declaration
Since the announcement of “KKR+A (Kenko [Health], Kankyo [Environment], Recycling and Amenity)” in 1998, the Suminoe Textile Grouphas been actively engaged in environmental conservation activities, such as interior environment improvement and utilization ofrecycled materials as well as decreasing our impact on the environment. In the Second SUMINOE Environmental Declaration formulated
this time, we aim to promote global strategies to ensure that our products will be used by many more people and to promote “KKR+A”
around the world. We will make Group-wide efforts to take on challenges to achieve our aim.

Guideline on Activity
In carrying out environmental conservation activities
We will positively promote energy-saving, resource-saving, and recycling with a consideration not to contaminate environment in allof our business activities.
We will try to preserve environment through products’ life cycle from production, sales to disposal by developing environment-friendly
technology and products.
① Development of technology for energy-saving and resource-saving② Development of recycling technology and recycling system③ Development of products and technology to replace materials which would put less load on environment and have more safety④ Development of product which could improve interior environment and contribute to health and comfort
We will try to live together with community through close communication and all employees will start action from whatever one cando.
We will try to maintain internal system to promote environmental protection and enhance environmental consciousness of all
employees.

Environmental Protection Promotion System
The Environmental Promotion Subcommittee was set up within the CSR Promotion Committee. Environmental measures drawn up andfinalized by the subcommittee are implemented in all divisions throughout the Group.
CSR Promotion Committee

Suminoe Textile
Headquarters &Administration
Headquarters
Automotive Textile
Business Headquarters

Working Group1

We shall provide healthy and environmentally friendly products.

Management Meeting

CSR & Internal
Control Council

Environmental
Promotion
Subcommittee

We will provide safe and secure products to our customers by properly managing chemical substances used in our products based on
the Green Procurement Guidelines regarding legal regulations and restrictions on materials used in products.

2

We shall promote the reduction of CO2 emissions.

To play a part in realizing a decarbonized society, we will develop and provide low-carbon products based on the Life Cycle Assessment(LCA) method. LCA is intended to comprehensively and quantitatively evaluate the impact of manufacturing activities on theenvironment while taking into consideration the entire life cycle of products ‒ materials, manufacturing, transportation, use, anddisposal.

33

Interior Fittings Business
Headquarters
Technical and
Production Engineering
Headquarters

Introduction of Environmental Management System
The Nara Factory obtained ISO 14001 certification in fiscal 2001, making it the first among the Group to be awarded certification on
environmental management. To date, five factories in Japan have obtained ISO 14001 certification, and one factory Eco Action 21
certification.

We shall address the circulating society.

To contribute to the reduction of industrial waste and the recycling of resources in the life cycle of products, we will actively use recycledmaterials as part of our efforts to promote environmental conservation and the efficient use of resources.

4

Functional Materials
Business Headquarters

OfficeManagement WG

We shall work to prevent global warming.

We will promote the effective use of resources by reducing losses of primary materials, auxiliary materials, water, and energy occurringin the production process. We will also update energy-saving facilities constantly, improve product quality, reduce the weight ofproducts, and simplify packaging. At the same time, we will strive to increase the efficiency of transportation of materials and products,
material utilization, and waste disposal during manufacturing, thereby promoting resource and energy conservation throughout the
supply chain.

3

Traffic Facilities
Business Headquarters

Environmental
Management WG

Suminoe Textile Group Integrated Report 2022

ISO 14001 : 2015

Eco Action 21: 2017

Nara Factory, Shiga Factory

Teijin Tecloth Ltd.

Owari Seisen Co., Ltd.:
Head Office Factory, Ishikawa Factory

Screening andregistration agency

Japanese Standards
Association

Japan Quality Assurance
Organization

Japan Quality Assurance
Organization

Institute for Promoting
Sustainable Societies

Registration number

JSAE 235

JQA-EM1519

JQA-EM3114

0009522

Registration date

May 2000
7th renewal completed(May 2021)

April 2001
7th renewal completed(April 2022)

March 2003
6th renewal completed(July 2020)

July 2013
4th renewal completed(July 2021)

Registration renewal

TANGO TEXTILE Co., Ltd.

Suminoe Textile Group Integrated Report 2022

34

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Environment

E Environment
Eco Challenge 2024
Business activities undertaken by the Suminoe Textile Group are deeply connected to the environment. This holds true to our daily
operations, as well as to the entire lifecycle of our products—from product development and design, material procurement, production,
sales, distribution, consumption, disposal and recycling.
The Suminoe Textile Group is working on assessing and reducing the impact on the environment from all of our business activities
and our products throughout their lifecycle. We are committed to manufacturing environmentally friendly products. One example isactive use of recycled materials, including polyvinyl chloride powder recycled from used carpet tiles and raw cotton and polyester
pellets recycled from PET bottles. To promote sustainability, we place focus on environmental conservation, and Group-wide efforts areunderway to achieve the goals set under Eco Challenge 2024.

③ 3Rs regarding Waste Material
We are striving to reduce industrial waste generation byminimizing unused materials for our products, by not manufacturing products that do not pass quality standards, and by using
resources effectively.
Changes in amount of industrial waste generated■Amount of industrial waste generated（t）
10,000
8,000

2,000

Work areas

Index

Final numericaltargets

Base FY

1

Prevention of
global warming

Reduction of CO2 emissions(energy consumption)

Reduce by 3% (basic unit).

2021

2

Resources
conservation

Increase in utilization rate of recycledresources (major factories in Japan*)

Increase 3%.

2021

Increase by 1%.

Increased by 15.9%.

○

Reduction of industrial waste

Reduce by 3% (basic unit).

2021

Reduce by 1% (basic unit).

Reduced by 12.3%.

○

Increase in recycling rate

65% or more

Evaluation

Reduce by 1% (basic unit). Reduced by 12.4% (basic unit).

○

△

―

△

Reduce by 3% (basic unit).

2021

Reduce by 1% (basic unit).

Reduced by 6.5% (basic unit).

○

95% or more―

95% or more

91.1%

△

Promotion of LCA assessment for products

Perform LCA for 18 items―

6 items

16 items○

Promotion of development of environment-friendly technologies

3 cases―

1 case1 case○300

Promotion of development of environment-friendly products

9 cases―

3 cases

3 cases○200

Promotion of biodiversity preservation in business activities

―

―

―

―

―

100

5

Increase in green purchasing rate
for office supplies (in Japan)○: Attained△: Not attained at some factories

×: Not attained

Basic unit: Consolidated sales used as a denominator for calculation
Emission factor: For domestic factories, the amounts of CO2 and N2O emissions are calculated based on an emission factor set in accordance with the law to promote measures against global
warming. For overseas factories, the calculation is based on an emission factor set for each country in the 2006 IPCC Guidelines for National Greenhouse Gas Inventories.
* Major factories in Japan: Shiga Factory and Nara Factory Suminoe Techno Co., Ltd., Teijin Tecloth Ltd., and Head Office Factory and Ishikawa Factory Owari Seisen Co., Ltd.

Results for Fiscal 2022
① Prevention of Global Warming
We assess the impact of our corporate activities on global warming
based on CO2 emissions.

② Resources Conservation
We are actively using recycled resources for product manufacturing
to promote savings in resources.

Change in CO2 emissions

Changes in utilization rate of recycled resources(Major factories in Japan)■Domestic■Overseas●Basic unit(t/¥1 million)(1,000 t)
120

0.8

0.593

80

40
20

62.2

58.5

23.8

22.4

38.4

36.1

0

2018

35

6,434

5,782

2018

2019

2020

2021

0
2022 (Fiscal year)

2019

0.557
51.0
18.8

0.566

40

0.496

18.7

32.3

26.4

23.9

2020

2021

2022

40.8
38.2

36.4

39.1

42.5

33.6

32.5

32.2

2019

2020

2021

2022

(Fiscal year)

（kg）
400

■N2O emissions●Basic unit(g/¥1 million)

390
3.98

367
3.73

10

328

303

291

8

3.58

3.80

3.56

4

6
2

0
2018

2019

2020

2021

2022

0
(Fiscal year)⑤ Promotion of Green Activities
We are actively promoting purchases of environmentallyfriendly office equipment and supplies to reduce their impact
on the environment throughout their entire life cycle, fromcollection of materials to disposal.
Changes in green purchasing rate for office supplies (in Japan)
（％）
100

87.6

91.1
85.2

86.2

86.1

2019

2020

2021

0
2018

46.4
37.3

37.7

37.3

40.1

20
10
0
2018

2019

2020

2021

2022

(Fiscal year)⑥ Promotion of LCA* Assessment for Products
We have conducted in-house LCA assessments for our products
since fiscal 2016. In fiscal 2022, we carried out LCA assessments
for 16 items.

30

0.0(Fiscal year)

41.0●Rate of waste disposed of in landfills

Changes in N2O emissions

90

0.4

45.1

40.5
16.6

Suminoe Textile Group Integrated Report 2022

（％）
50

20

④ Prevention of Environmental Pollution
Among atmospheric contaminants, nitrous oxide (N2O) is usedhere as an example to explain the situation of air pollution.

42.5%
32.2%

Promotion ofgreen activities

60

6,932

2018

10% or less

0.635

7,434

0

65% or more

Prevention ofenvironmental pollution

100

40

6,537

40.8

30

―

4

8

FY2022 results

80
60●Recycling rate

10% or less3Rs regarding
waste material

Reduction in rate of waste
disposed of in landfills
Reduction of air pollution(reduction of N2O emissions)7

FY2022 numericaltargets

70.8

Changes in recycling rate and rate of waste disposed of in landfills（％）
50

Activity Goals and Fiscal 2022 Results

6

75.7

0

As a set of goals on environmental activities, we have formulated Eco Challenge 2024, which covers the three years from fiscal 2022 to
2024.

3

75.4

(kg/¥1 million)
100

6,000
4,000

Eco Challenge 2024

66.8

80.7

●Basic unit

2022

(Fiscal year)* LCA: Stands for lifecycle assessment. LCA is a method to quantitatively evaluate theresources used to produce a product at each stage of its lifecycle—from raw material
procurement, manufacturing, distribution and use to disposal— as well as its load on theenvironment, and also the potential environmental impact that the product and resources
may have on the Earth and ecosystems.

⑦ Promotion of Development of Environment-Friendly
Technologies and Products
Promotion of Development of Environment-Friendly
Products
Introduction of waste plastic recycling technology and equipment
To recycle waste textile materials into high-quality plastic
resources
Promotion of Development of Environment-Friendly
Products
1) “e.colore® (eco-loré)2,” which is undyed and non-printed
automotive seat covering material2) AVANCERA FLOOR, loose-lay vinyl floor tiles, made ofabout 53% recycled materials
3) ”Scene,” a rug made of 50% recycled polyester⑧ Environmental Activities for Preserving Biodiversity in
Business Operations
Activity Policy1）Reduction of impact on biodiversity from business activities
・Monitoring the situation on biodiversity around factories
and their vicinity
・Using locally-grown native species, not nonnative species,
for tree planting
・Periodically cleaning areas near factories and improving
environmental conditions there by weeding out grass・Checking sustainability when biological resources are usedas product material
・Promoting development of products with recycled material
and building a recycling system to manufacture such products
・Incorporating activities for biodiversity preservation into an
environmental management system
・Promoting new measures that are possible at each factoryfor preservation of biodiversity2）Activities to seek suppliers’ cooperation in reducing impact
on biodiversity across the entire supply chain
・Seeking cooperation from suppliers in observing green
purchase guidelines to promote our efforts to preserve
biodiversity
3）Social contribution activities
・Supporting groups engaging in forestry preservation activities
・Supporting green charity activities
Activity Results
Each factory has been implementing activities, taking
advantage of the regional characteristics.
Factory

Activity

Nara Factory of Suminoe
Textile Co., Ltd.

Participating in the Ando Ouyu-Kai, anassociation that works to develop acherry tree-lined promenade in thearea along the Okazaki River

Shiga Factory of Suminoe
Techno Co., Ltd.

Propagating the Sasayuri lily on thefactory premises

Factory at the head office ofOwari Seisen Co., Ltd.

Helping protect fireflies as a supporting
member of the Ichinomiya Heisei Firefly
Association

Suminoe Textile Group Integrated Report 2022

36

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Environment

E Environment
Initiatives to Address Climate Change Issues
The Group’s Policy for Addressing Climate Change Issues
The Suminoe Textile Group considers climate change to be oneof the important issues for management to address. Since theannouncement of “KKR+A (Kenko [Health], Kankyo [Environment],
Recycling and Amenity)” in 1998, the Suminoe Textile Group has
been actively engaged in environmental conservation activities,
such as interior environment improvement and utilization ofrecycled materials as well as decreasing our impacts on theenvironment. In the Second SUMINOE Environmental
Declaration formulated in April 2022, we aim to promote global
strategies to ensure that our products will be used by many more
people and to promote “KKR+A” around the world. We will makeGroup-wide efforts to take on challenges to achieve our aim.

Target for Reducing Greenhouse Gas Emissions

Target for reducing greenhouse gas (CO2) emissions
per unit of sales■Scope1: Direct greenhouse gas (GHG) emissions from the Group’s business operations■Scope2: Indirect GHG emissions from the use of electricity, heat, etc. supplied by others(Unit: t)

Reduce GHG emissions by
35% from FY2014 (fiscal year

80,00060,00040,00020,000

0
2014

2021

2031

(Fiscal year)

In July 2022, the Group declared its support for therecommendations from the Task Force on Climate-related Financial
Disclosures (TCFD) to further strengthen its effort to address
climate change issues. We have identified the climate-related risks
and opportunities, based on analyses of the 2°C scenario and the
4°C scenario. In the future, these identified risks and opportunities
will be reflected in our business strategies and risk management.
We will also appropriately disclose information in alignment with
the TCFD's recommended disclosures.

With regard to the risks and opportunities indicated in the TCFD final report, we have assessed the magnitude of impacts that climatechange would have on the Group’s business and financial performance, based on the “2°C or lower scenario” and the “4°C scenario.”State of the world anticipated based on the 2°C or lower scenario and the 4°C scenario

2°C or lower scenario

A scenario where strict measures are taken to reduce CO2 and other GHG emissions so that the increase in the global
average temperature in 2100 is limited to less than 2°C (0.9 – 2.3°C) above pre-industrial levels. Toward a decarbonizedsociety, governments implement bold policies and promote technological innovations. Due to strengthened policies,“transition risks” have great impacts.

4°C scenario

A scenario where the current measures against climate change go unchanged globally so that the average temperaturerises around 4°C (3.2 – 5.4°C) above pre-industrial levels. While risks associated with the transition to a decarbonizedsociety decrease, natural disasters continue to worsen, resulting in increased “physical risks,” such as extreme weather
events.

What is TCFD?
TCFD stands for the Task Force on Climate-related Financial
Disclosures, which was established in December 2015 by the Financial
Stability Board (FSB) at the request of the G20 countries, to encouragecompanies and institutions to disclose information about financial
impacts of climate change on these organizations.
While companies and institutions may face climate change-relatedrisks that are invisible in short-term financial statements, theircontribution and attention to a decarbonized economy will offer newopportunities for enhancing corporate value. To ensure the stabilizationof the financial system and help investors and lenders make appropriate
investment and lending decisions, information on climatechange-related risks and opportunities has assumed greater importance,
requiring uniform disclosure standards. Against this backdrop, the TCFD
published its final report in June 2017. It recommends that companies
and other entities disclose information on governance, strategy, risk
management, and metrics and targets related to the risks entailed in andopportunities offered by climate change, providing a basic framework forsuch disclosures.

Assessment of impacts that climate change-related risks and opportunities will have on the Group’s business and financial
performance
Examples of climate change-related risks/opportunities according to the TCFD final report
Category of risks/opportunities
Policy andlegal risks

Technology risks

Transition risks
Risks associatedwith the“transition” tolow-carbon
economyGovernance
Strategy
RiskManagement
Metrics andTargets

The organization’s governance aroundclimate-related risks and opportunities
Significant impacts of climate-related risks andopportunities on the organization’s businesses,
strategy, and financial planning
The processes used by the organization to identify,
assess, and manage climate-related risks
The metrics and targets used to assess and manage
relevant climate-related risks and opportunities

Physical risks
Risks associatedwith “physical”
changes causedby climate change

2°C or lower
scenario

Major aspects/viewpoints

Example of potential impacts
・Increased costs for switching to renewable energies
and energy-saving equipment
・Increased costs related to information disclosure・Replacement of existing products withlower-carbon technology options
・Introduction of new technologies

・Write-offs and early retirement of existing assets
・Increased costs for system changes and introduction of new processes
・Increased workload in business operations, for modification
management, etc.

・Changing customer behavior
・Uncertainty in market signals (greaterdifficulty in forecasting market movementswith conventional ways of thinking)・Increased cost of raw materials

・Shift in consumer preferences and reduced
demand, resulting in decreased revenues
・Increased production costs
・Increased costs for waste treatment

・Increased severity and number of extreme
weather events such as cyclones and floods

Chronic risks

・Changes in precipitation and weather patterns
・Rising mean temperatures
・Rising sea levels

Positive impacts associated withimproved efficiency in resource
utilization

4°C
scenario

・Stricter regulations on GHG emissions
・Expanded obligations to disclose information

Acute risks

Resource efficiency

What is scenario analysis?
The TCFD recommends that companies and other organizations
conduct scenario analysis, which is a useful means of forecasting thefuture when designing their strategies. Scenario analysis is the process offorecasting the direct impacts of climate change as well as what changes
could occur in the business environment due to long-term policy trends
related to the response to climate change and of examining the potential
impacts of these changes on the company’s business strategies. There
are two methods of scenario analysis. One is creating the company’s own
scenarios and the other is using existing scenarios provided by industry
groups or international organizations (e.g., the “2°C Scenario” proposedby the IEA) as a reference. By performing scenario analysis, companies
and other organizations can assess their potential future states while
making assumptions about different hypothetical futures. Then theseorganizations disclose their future assessments, with which investors andlenders can understand the vulnerabilities to risks and potential
opportunities of these organizations, and how they respond to climatechange-related risks and opportunities.

Market risks

Analysis of impacts on the Group*・Shifts in consumer preferences
・Stigmatization of the sector that makes less
Reputation risks contribution to low-carbonization
・Increased stakeholder concern or negative
stakeholder feedback

Four items of the TCFD recommendations and descriptions of each item

・Decreased demand and revenues due to changes
in the company image perceived by consumers
・Increased measures to address stakeholder
feedback regarding the company’s response to
climate change・Decreased capabilities for production anddistribution due to ceased facility operations,interruptions of transportation means and supply
chains, etc.
・Negative impacts on workforce (e.g., health, safety,
absenteeism)
・Increased costs of provisions for damage to facilities
・Increased production capacity, resulting in increased
revenues, due to efficient improvements in production
and distribution processes and modes of transportation
・Cost reduction resulting from improved efficiency
in resource utilization related to business operation

・More efficient production and distribution
processes
・More efficient modes of transportation
・Use of recycling
・Reduced water usage and consumption

・Use of low-carbon energy sources
・Use of new technologies
・Shift toward energy security and decentralizedenergy generation
・Development and/or expansion of
low-carbon goods and services
Products and services
Positive impacts associated with the ・Development of new products or services
through R&D and innovationneeds of a low-carbon society
・Diversified business activities and a shift inconsumer preferences

・Reduced exposure to fossil fuel price increases
・Reduced exposure to GHG emissions and therefore
less sensitivity to changes in social cost of carbon

Positive impacts associated with changes
in the market and economy due to the ・Access to new markets
trend toward a low-carbon society
・Promotion of renewable energy programs
Resilienceand energy-saving measures
Positive impacts associated with・Resource substitutes/diversification
resilience to climate change
・Increased reliability of supply chain・Increased revenues through business expansion
into new and emerging markets

Energy source
Opportunities

ended May 2014) levels

Scenario Analysis in Line with the TCFD Recommendations

Risks

In accordance with the policy of the Medium- to Long-termManagement Targets “SUMINOE GROUP WAY 2022-2024-2027,”
the Group established its long-term target for reducing
greenhouse gas (CO2) emissions in April 2022.
Specifically, by FY2031 (fiscal year ending May 2031) all theGroup companies will strive to reduce CO2 emissions in businessactivities by 35% from the levels of FY2014 (fiscal year ended
May 2014).
To promote the reduction of CO2 emissions resulting fromour business activities, we will implement concrete measures,
including improving logistics systems, unifying the production
bases, improving energy efficiency, changing fuels used, andpromoting working style reforms. In conjunction with thesemeasures, we will strive to expand sales of environmentallyfriendly products. Through these two approaches, the Groupwill contribute to the realization of a decarbonized society.

Support for TCFD Recommendations

Positive impacts associated with ashift to low-carbon energy sources

Market* The directions of respective arrows indicate that potential business and financial impacts will be・Increased revenues through satisfying demand for
products that emit fewer GHG emissions
・Better competitive position to reflect shifting
consumer preferences, resulting in increased
revenues

・Increased corporate valuation due to resilience toclimate change (resilience plan contents,
establishment of a stable supply chain, diversity ofalternative resources, etc.): Very significant: Somewhat significant: Insignificant* As for Scope 3 (Indirect emissions that are generated by other companies related to theGroup’s business operations, excluding Scopes 1 and 2), we are currently preparing tocalculate the emissions.

37

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 2022

38

ESG Initiatives in Line with the Medium- to Long-term Management Targets
SocialS Social
Based on the Act on Promotion of Women’s Participation andAdvancement in the Workplace, Suminoe Textile Co., Ltd. has formulated
its 4th action plan (June 1, 2022 to May 31, 2024), as reported below.

Respect for Human Rights
Basic Approach

The Suminoe Textile Group fosters an organizational culture
where capable and highly motivated employees can
succeed, and creates new value and innovation, by
accepting and respecting diversity in personal values andattributes, such as nationality, race, religion, gender, age,and physical features.

Promoting Women’s Participation
Results of women’s empowerment initiatives(Group companies in Japan)

As of the end of May each year

Item

2021

2022

Male

10

17

Female719

Percentage of female managers/supervisors* (%)

11.1

10.4

*Percentage of female employees whose positions correspond to section chief orhigher at the Group companies in Japan

Below are the results of activities implemented by Suminoe
Textile Co., Ltd. under its 3rd action plan (June 1, 2020 to May 31,2022), which the Company established based on the Act on
Promotion of Women’s Participation and Advancement in the
Workplace.
Targets
1-①: Raise the ratio of new female graduates
hired to 35% or more.

39

Evaluation△（32%）

1-②: Implement initiatives to increase thenumber of female managers andsupervisors.

○

2: Implement initiatives to create anenvironment where both male and female
employees can succeed while striking abalance between career and family life.

△

3: Have one or more male employees taking
childcare leave and maintain the rate offemale employees taking childcare leave at
100%.

○

Suminoe Textile Group Integrated Report 2022

2-①: Implement initiatives to create an environment where bothmale and female employees can succeed while striking abalance between career and family life.
2-②: Increase the rate of male employees taking childcare leave
to 25% or more and maintain the rate of female employees
taking childcare leave at 100%.

Action plans of other Group companies are published in the Databaseon Promotion of Women’s Participation and Advancement in the
Workplace, which is run by the Ministry of Health, Labour and Welfare.

Basic Policy

Number of new graduates hired

1-②: Implement initiatives to increase the number of female
managers and supervisors.

Contents of initiatives
Initiatives

Details

Promotion ofa work-life balance

Support employees in striking a balance between
career and family life by such means as establishinga system that accommodates diverse work styles.

The Group has a system of re-employing former employees who
have retired at the mandatory age of 60 as “Senior Employees,”
offering them a workplace where they can use their career,capabilities and aptitudes. This system is intended to take advantageof the knowledge and experience accumulated by Senior
Employees and pass their expertise on to younger employees.

Measures against
lifestyle-relateddiseases, etc.

Prevent and early detect lifestyle-related diseases,
etc., and help employees improve their healthbased on the results of their health checkups.

Measures against
mental healthproblems

Implement activities to prevent and alleviate
stress, by such means as conducting stresscheckups to make them aware of their stresslevels and providing consultation services andtraining programs.

Re-employment rate (Group companies in Japan)

Raising healthimprovementawareness

Implement activities to make employees awareof the importance of maintaining andimproving their health in daily life, bydisseminating heath information and providing
health counseling services.

Participation of Senior Employees

Item

2021

2022

Re-employment rate (%)

85.2

83.8

Work-Life Balance

Employment of Foreign Nationals
In line with our recruitment policy of securing “diverse humanresources,” we have employed capable individuals regardless ofnationality. This fiscal year, we hired one foreign national, so a
total of 38 foreign employees* are working with us.
* Only Group companies in Japan

Employment of People with Disabilities
Based on the Diversity and Inclusion Basic Policy, we strive to achieve
the legally required percentage of employees with disabilities.
Employment rate of people with disabilities(Group companies in Japan)

As of the end of March each year

Item

2021

2022

Employment rate of people with disabilities (%)

1.71

1.56

Health Management
The Group stipulates that “We give the highest priority tosecuring people’s safety and health in all the processes of all
business activities” in its Code of Corporate Behavior. Based on
this provision, we will promote initiatives for securing safe work
environments and people’s health.

Basic Policy
The Suminoe Textile Group implements initiatives to allow
employees to work in a flexible manner according to various
life events, based on the idea that enhanced work-lifebalance is important for them to continue working withenthusiasm.

Item/sex

Family care leave, etc.

Diversity and Inclusion

1-①: Raise the rate of new female graduates hired to 35% or more.

The Suminoe Textile Group believes that mental and physicalhealth of individual employees form a foundation for its
business growth. If employees can enjoy working in good
health, it will lead to the happiness of employees as well as to
the Group’s growth as a “good enterprise.” The Group also
upholds health in its fundamental development philosophy“KKR+A” (Kenko [Health], Kankyo [Environment], Recycling,and Amenity). Along with various business activities related
to health, we will practice health management throughproactive health promotion initiatives.

Number of employees who used childcare/family care
supporting systems (Group companies in Japan)

Childcare leave, etc.

The Group’s Standards of Conduct lays out that “We shall ensure
a sound working environment where no employees areharassed or discriminated against because of their race, beliefs,
religion, nationality, physical features, etc.” Based on thisprovision, we are in the process of formulating a human rights
policy including “human rights due diligence.”

Targets

Health Management Declaration

Male
FemaleMale
Number of employees who returned
to work after childcare leave
FemaleMale
Number of employees who reduced
working hours
FemaleNumber of employees who advanced/
Male
postponed work start/finish times
FemaleMale
Number of employees who tookfamily care leave
FemaleNumber of employees who reduced
Maleworking hours
FemaleNumber of employees who advanced/
Male
postponed work start/finish times
FemaleNumber of employees who tookchildcare leave

2021

2022

3
12
3
11
0
17
0
5
2
2
0
0
0
0

1
13
1
9
0
18
0
4
0
0
0
0
0
0

Working from Home and Staggered Working Hours
Measures to accommodate flexible work styles
On June 1, 2022, Suminoe Textile Co., Ltd. and Suminoe Teijin
Techno Co., Ltd. officially instituted systems for working fromhome and staggered working hours, both of which wereintroduced as temporary measures in the COVID-19 crisis.
Working from home is available for employees who care forchildren, the elderly and other family members as well as forother employees who have unavoidable reasons, whereas all
employees can use staggered working hours. In addition,
SUMINOE Co., Ltd. also introduced the work-from-home system
on August 1 of the same year. We aim to apply these systems toother Group companies in the future.

Promoting Measures to Remedy the Issue of Long
Working Hours and to Encourage the Use of Paid Leave
Discussions on how to reduce employees’ working hours
The First Human Resources Subcommittee regularly holds
meetings to report on and discuss improvement measurestaken by each Group company to reduce employees’ working
hours. As for the use of paid leave, the rate of employees using
paid vacation days increased from the previous year.

Supporting a Balance between Career and Family Life
(Childcare/Family Care)Use of paid leave (in Group companies in Japan)
Item

2021

2022

Creation of a workplace environment where employees
can easily use support systems
The Group has established various systems to support
employees in striking a balance between work andchildcare/family care. To make it easier for employees to use
such systems, these systems should be well understood by theirsupervisors and people around them. Suminoe Textile Co., Ltd.
has prepared a handbook that provides explanation about
these support systems for supervisors and has posted thehandbook on the in-house intranet.

Use rate of annual paid leave (%)

59.4

60.4

Implementing Harassment Prevention Training
Continuous implementation of training at various
operation sites
This fiscal year, a communication training program was held at
Suminoe Techno Co., Ltd., the Nagoya Sales Office of SUMINOE
Co., Ltd., Owari Seisen Co., Ltd., and Teijin Tecloth Ltd. The training
program was aimed at harassment prevention so as to facilitate
the establishment of smooth relationships at workplaces.

Suminoe Textile Group Integrated Report 2022

40

ESG Initiatives in Line with the Medium- to Long-term Management Targets
SocialS Social
Interviews with Employees for Fostering
Next-Generation Leaders

Human Resource Development and Utilization

Encouraging the Career Development of Young Employees

Basic Policy on Human Resource Development
The Suminoe Textile Group considers human resources tobe the source of sustainable corporate growth and the mostimportant assets. The Group cultivates professional andcreative human resources, paying respect to thepersonalities and characteristics of individual employees.
Human resource development programs① Personnel education is provided basically though OJT(on-the-job training).
② Our training curriculum comprises training programs foryoung employees (respectively designed for new recruits, forsecond-year employees, and for third-year employees) andlevel-based programs offered at every promotion (training forleaders, supervisors, and managers).
③ From among employees in their 30s and 40s, those selected
will receive the next-generation leader training program, whichuses business schools and in-house collective training sessions.
④ All employees are provided with opportunities for
self-development (through corresponding courses,
language training, skill improvement training, etc.).

A team of trainees presenting their plan

Education system

Number of employees taking training

Level-based

Role-based

Selective

Collective trainingYoung
employees

Training for secondyear employees

Language training

Training for thirdyear employees

Corresponding course

Leader training

Training for
new employees

Next-Generation Leader Training
Prospective next-generation leaders proposing futurebusiness strategies
For seven months, 11 employees who were selected asprospective next-generation leaders of the Group underwent
the training program for nurturing such leaders. These
employees first participated in training held at a businessschool. Then these employees were divided into three teams
and received in-house collective training, where they devisedplans for business strategies to be implemented by the Group in
the future. On the final day of the training, each team of trainees
presented their plans to executives. At a later date, theirpresentations were shared through the in-house intranet toraise awareness of all employees.

41

Suminoe Textile Group Integrated Report 2022

Initiatives aimed at improving skills of employees
We have continuously held online training programs for skill
improvement, inviting instructors outside the Company. Thisfiscal year, seminars were held on MS Word and Excel, which areuseful in work efficiency enhancement, effective use of online
communication tools, and how to improve presentation skills.
These training programs received many applications fromseveral Group companies in Japan. A total of 315 employees
participated in these programs.
(FY2022)

Training type

Total

Male

FemaleNew employees, 2nd and 3rdLevel-based employees, leaders,
supervisors, managers

147

100

47

22
315

16
171

6
144

116

62

54

22

19

3

11

10

1

Role-based

Skill improvement training(theme-based)

Supervisor
training

OJT instructor training

Mid-career
employees

Management
training

Evaluator
training

Managers

Selective(for selfdevelopment)

Skill Improvement Training

Selective

Evaluators, OJT instructors
Skill improvement
Self-development(corresponding course)
Self-development(language training)

Nomination/ Next-generation leader
selective
training

Interviews with Employees to Promote Communication
Creating a comfortable working environment
Suminoe Textile Co., Ltd. implements interviews with
employees to promote communication with them. Around
November every year, new employees are interviewed about
their problems, anxieties, work motivation, and so on. These
interviews are aimed at establishing a relationship of trust thatmakes it easier for new recruits to express their opinions to andconsult with their supervisors and at improving the percentageof young employees who stay in the Company. In addition, theopinions submitted through these interviews are utilized for
producing new proposals on a new system and for resolving
workplace issues.

Suminoe Textile Co., Ltd. held “interviews for fostering
next-generation leaders” with nine young employees who were in
their sixth year of employment. An interview was held twice foreach employee. In the first round of interviews, these young
employees designated one of their senior employees who theywish to hear from. The designated seniors talked about thetroubles, targets, approaches to the job and the like that they had
as young employees. These seniors also told their present views
and gave advice to these juniors. In the second round, the Human
Resources Department Director interviewed the young employeeson their present work and future career for about one hour. Goingforward we will continue to hold these interviews and intensify ourefforts to establish a system that helps young employees reaffirm
their own goals and that supports their personal growth.

Career Self-Declaration System
Cultivating Independent and Autonomous Human Resources
Suminoe Textile Co., Ltd. is considering establishing a “careerself-declaration system” by which employees can declare to
their department managers and the Company what kind ofcareer path they wish to pursue in the future. The major purposeof the system is to cultivate autonomous human resources byencouraging employees to think about their future career andto proactively engage in their jobs. The system is also expected
to prove effective in promoting personnel transfers based on
the contents of these declarations. To make the system viable,
the Third Human Resources Subcommittee held a meeting forexchanging views. Participating members advanced many
opinions regarding advantages and disadvantages of instituting
such a system and submitted ideas for creating a better system.
Based on these opinions and ideas, we plan to develop a draft
plan for the system in the future.

TopicsSuminoe Techno Co., Ltd Launching a Transfer
Request Self-Declaration System
Self-declaration of employees’ wishes to transfer totheir desired departments
In March 2022, Suminoe Techno Co., Ltd. launched atransfer request self-declaration system. This system canbe used by employees with skills at an intermediate or
higher level, after three years have passed since they wereassigned to the current departments. It is designed to
improve job satisfaction through transfers of employees toa department of their choice and to revitalize theorganization by putting the right person in the right job.

Questionnaire Survey on Workplace Comfort(In-house Employees’ Opinion Survey) 2022
Realizing a Comfortable Working Environment andChecking on the Progress of CSR Activities
The Questionnaire Survey on Workplace Comfort is conducted
once a year for all Group employees in Japan. The survey results
are compiled to assess the progress of CSR activities and utilize
the results for future initiatives.
This year’s survey consisted of three questions asking
respondents to freely write about their ① opinions on the Group’s
compliance and corporate culture, ② ideas for development andutilization of diverse human resources, and ③ ideas for activating
communication between different departments.
In response to question ①, many employees expressed
positive opinions saying, “The Group secures good compliance.”
However, as to question ②, some respondents pointed out
insufficient progress in initiatives for human resource
development, promotion of women’s participation, promotion ofa life-work balance, and the personnel transfer system. In
answering question ③, some employees commented that it may
be a good idea to hold opinion exchange meetings, and someothers suggested that employees should mutually present thejobs of their respective departments. The survey results are sharedwith the Management Meeting and the responsible personnel ineach department. Also, a summary of these results is madeaccessible to all employees through the in-house intranet.
In the future, based on the opinions and ideas obtained
through the survey, we plan to implement “initiatives tomaximize human capital,” as effective measures in line with thebasic policy on sustainability and sustainably-related policies aswell as the Medium- to Long-term Management Targets.
Initiatives to maximize human capital (planned as of August 1, 2022)
1) “Career self-declaration system” for facilitating self-directed careerdevelopment of employees
2) Interactive communication between employees and management
and between different departments

With regard to human resource development, we will redefine
our corporate philosophy and brand value and review thecurrent human resource strategies based on the Basic Policy on
Sustainability and Sustainability-Related Policies.
Human resource strategies (planned as of August 1, 2022)
System and measures
1）Management system (organizational culture and organization
management)2）Strengthening measures (sharing of the corporate philosophy,
recruitment of diverse human resources, strengthening ofmanagement capability of managers, enhancement of training andeducation, and review of the personnel system)
Matters in preparation
1）Redefinition of corporate philosophy and brand value for “purpose
branding”
2）The type of person we are looking for

Suminoe Textile Group Integrated Report 2022

42

ESG Initiatives in Line with the Medium- to Long-term Management Targets
SocialS Social
Developing a Safe and Secure Work Environment

Dissemination of the Corporate Philosophy andthe Management Policy, and Sharing the Progress“Safety First”—the first and foremost priority is safety.
The Suminoe Textile Group regards “safety” as the mostimportant theme. Giving the highest priority to securing
people’s safety and health in all processes of all its businessactivities, the Group works to prevent occupational
accidents and create a comfortable working environment.

Continuing activities to prevent occupational accidents
It has been one year since Suminoe Techno started to review andreinforce its health and safety promotion system comprising the
Health and Safety Committee, Workplace Executive Committee
and subcommittee. The company continuously works to ensurethat these activities will take root in daily operations throughmutual surveillance between these three committees.

Making the SGW known to all employees
To achieve the Medium- to Long-term Management Targets“SUMINOE GROUP WAY 2022-2024-2027” (SGW), we need toensure that the SGW is communicated to and observed by all
Group employees. This fiscal year we published the SGW in thein-house newsletter and the CSR Report, which were distributed
to all employees of Group companies in Japan and employees
stationed overseas.

Suminoe Textile Group Safety Code of Conduct

Conducting the Questionnaire Survey on Safety
Awareness of Employees

・Top management always takes the initiative in improving
the safety culture and sets a good example for employees.
・We build up a workplace climate of safety first.
・We comply with applicable laws and regulations and thein-house regulations.
・We aim to improve the work environment with theparticipation of all employees.
・We take proactive measures to ensure safety by predicting
potential risks.
・We conduct safety education and drills.

Progress in the Occupational Health and Safety Initiatives
Deliberation on the causes of occupational accidents andpreventive measures against these accidents
The Group’s Central Health and Safety Subcommittee holds
meetings twice a year, bringing together persons in charge ofpromoting occupational health and safety at Group companies,
to exchange views about prevention of occupational accidents
and report on the activities of each company. At the meeting inMarch 2022, participants deliberated primarily about the causesof “unsafe behaviors” and measures to prevent them. In fiscal
2022, the rate of lost-worktime injuries was 0.70, showing an
improvement from the previous fiscal year.
In December 2020, an occupational fatal accident
occurred at the Shiga Factory of Suminoe Techno Co. Taking theaccident seriously, we are making Group-wide efforts topromote occupational health and safety activities.
Change in the incident rate* of Group companies in Japan
Incident rate
8

All Group companies in Japan

6.33

0

(Lost-worktime injuries & non-lostworktime injuries)

5.99

Average for the industry

4.98(Lost-worktime injuries)

4
2

2.00
1.02
2018

3.40

3.50

1.21

1.31

1.33
1.20

1.20

2019

2020

1.02
2021

2022 (Fiscal year)

All Group companies in Japan(Lost-worktime injuries)

2.00
0.70

Source: 2021 Workplace Accident Trend Survey, Ministry of Health, Labour and Welfare* Incident rate: Accident frequency, measured as the number of deaths andinjuries caused by industrial accidents per million working hours

43

Omnidirectional Communication

Maintaining and Continuing the Health and
Safety Promotion System

Promotion of Occupational Health and Safety
in the Suminoe Textile Group

6

Activities of Suminoe Techno Co., Ltd.

Suminoe Textile Group Integrated Report 2022

Continuing to promote health and safety activities
incorporating opinions of employees in this fiscal year
To educate employees about occupational health safety, thecompany conducted a comprehension test and theQuestionnaire Survey on Safety Awareness of Employees, as inlast year. By comparing this year’s results with those in theprevious year, management can grasp the changes in
employees’ safety awareness at the entire operation site and ineach workplace. In doing so, the company will promote healthand safety activities in a more effective manner.
Results of the Questionnaire Survey on Workplace Safety
Awareness (Year-on-year comparison)■Agree. ■Somewhat agree.
■ Somewhat disagree. ■Disagree.
2021

2022

Management has a high degree of interest in health and safety.
24.5%

41.5%

26.9%

23.9%

46.8%

21.5%

7.1%

7.8%

We are safety-conscious and always place priority on safety.
19.4%

45.8%

26.9%

23.9%

49.8%

18.0%

8.3%

8.3%

All of us are made well aware of work-related laws and regulations.
16.2%

56.9%

24.1%

17.1%

56.1%

23.4%

2.8%

3.4%

We follow instructions of supervisors and observe the applicable regulations and safety rules.
22.9%

54.2%

19.8%

23.9%

57.6%

15.6%

3.2%

2.9%

Promotion of Health and Safety Education Activities
Safety awareness-raising through enhanced safety education
In fiscal 2022, Suminoe Techno enhanced safety education byreviewing and updating its health and safety educationmaterials as a whole. The company also created educational
materials tailored to each workplace and provided education
using these materials. Additionally, Suminoe Techno held
seminars to educate safety managers and foremen andconducted hands-on training for general employees to nurture
their sensitivity to danger. By enhancing safety education, thecompany aims to raise the “safety” awareness of employees.

Group-wide sharing of IR information
Investor relations information announced outside the Company
is communicated to the Group companies. This fiscal year,
Suminoe Textile Co., Ltd. participated in a seminar for private
investors, organized by Radio Nikkei, “Radio Nikkei Japan Tour IR& Stock Investment Seminar by Hideaki Sakurai,” where thePresident of the Company presented an overview of the Groupand initiatives that we would focus on in the future. The
recorded radio program was posted on the in-house intranet.

Communication between Departments
Exchanging opinions transcending the boundaries ofdepartments
Since before, a lack in communication between departments
has been pointed out as an issue that we should address.
To deal with this issue, from July to September 2021, we
held online meetings to facilitate exchange, mainly among
administrative and sales staff of Group companies, on suchthemes as striking a balance between work and childcare and
the Group’s initiatives for women’s empowerment. After
participating in the meetings, many employees commented
that “I had a valuable opportunity to talk with people withwhom I usually have little contact.” In September, theDevelopment Department hosted a meeting for young
employees to deepen their understanding of what kind of work
was conducted in the Department. At the meeting, participantspresented the contents of their department’s jobs and theirown jobs and exchanged views with others. The objective of
this meeting was to promote personal growth of young
employees by offering opportunities to consider how tocooperate with other departments and how to resolve issues
through such cooperation. This year’s meeting was focused on“insufficient sharing of information on the technologies andknowledge possessed by employees working in theDevelopment Department.” To resolve this issue, data on jobs
that each employee had performed were compiled into a
database, which was shared with other departments.
Aiming to create a greater synergy by enhancing the senseof oneness among Group companies, we will continue toenlarge opportunities for opinion exchange transcending thedepartmental boundaries.

Social Contribution Activities
Community-based Social Contribution
Activities of each factory/office
Both in Japan and abroad, the Group has carried out a wide
range of social contribution activities, such as donations,cleaning and education support, in keeping with its Code of
Conduct, which states that “We make proactive contributions tothe community, as expected of a good corporate citizen.”

TopicsSupport and Donation for Poverty and Starvation
Making donations to a home for the elderly and ahomeless assistance organization
Suminoe Textile de Mexico, S.A. de C.V. (STM) participatedin a social contribution project organized by a supplier.
From its employees, STM raised donations of food andeveryday items, sorted them out, and delivered these
donations to a home for the elderly. Suminoe Textile ofAmerica Corporation (STA) made donations to a homelesssupport organization.
In fiscal 2022, STA
gifted food to theorganization on Christmas and Thanksgiving
Day and then received
Souvenir photograph taken at the home fora letter of gratitude.
the elderly

Contribution in Cases of Disasters
Cooperating with a local fire department
TANGO TEXTILE Co., Ltd. has provided cooperation for
activities of the Kyotango City Fire Department, in supportof its philosophy “As a leader of firefighting and disaster
preparedness in the region, we conduct community-based
activities to protect citizens’ safety and peace of mind, bothin emergency and ordinary situations.” Currently, twoemployees of the company are involved in local disasterprevention activities,
including firefighting
and raising people’s
awareness of crime
prevention.
Firefighting training

Suminoe Textile Group Integrated Report 2022

44

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Governance

G Governance
Board of Corporate Auditors
The Board of Corporate Auditors consists of three auditors(including two outside auditors). The Board decides auditing
policies and plans and deliberates on audit reports.

Enhancing Governance
Basic Approach
The Suminoe Textile Group believes that the objective ofcorporate governance is to secure the soundness and efficiencyof management. In doing so, the Group stives to enhance its
corporate value to continuously return profits to stakeholders.
To secure the soundness and efficiency of management, wehave been appointing outside directors and strengthening thefunction of the corporate auditor system. The Board of Directors
functions as a body for making management decisions in a
speedy and agile manner and for overseeing the status ofbusiness execution. The Company has also introduced an
operating officer system, under which operating officers are held
responsible for business execution. In terms of risk management,
we have formulated the Group Code of Conduct and the Group
Standards of Conduct. By appropriately operating these codes,
we aim to be a company trusted in society.

Governance System
Board of Directors
The Board of Directors comprises nine directors (including four
outside directors) and supervises business execution and makes
decisions on important matters.

Nomination and Remuneration Committee
The Nomination and Remuneration Committee is set up as anadvisory body to the Board of Directors. The Committee aims tostrengthen its oversight function by improving transparency
and objectivity in the evaluation and determination processes
concerning the nomination and remuneration of the membersof the Board of Directors, thereby further enhancing thecorporate governance system.
The Committee membership comprises five directors
selected by a resolution of Representative Directors,
independent outside directors and the Board of Directors. The
majority of the membership should be outside executives,
including independent outside directors.
Management Meeting/CSR & Internal Control Council
A Management Meeting is held every week, in principle, toreport and deliberate on important management matters.
Matters of particular importance will be reported to the Board of
Directors. CSR-related important matters and evaluation ofinternal controls concerning financial reports are discussed at a
meeting of the CSR & Internal Control Council. The meeting is
attended by one full-time corporate auditor as an observer.

Board of Operating Officers
The Board of Operating Officers comprises the President andoperating officers of Suminoe Textile Co., Ltd. and holds its
meetings once a month. At the monthly meeting, the decisions
made by meetings of the Board of Directors or by theManagement Meeting are announced, and reports are made on
the present status of business execution by each operating
officer.

resolution after due deliberation at a meeting of the Board of
Directors, with attendance of independent outside directors.
In July 2019, we set up the Nomination and Remuneration
Committee, which has been functioning as an advisory body to
the Board of Directors.
The Company’s Board of Directors consists of inside Directors
who are well versed in respective business and corporate activities
and have a wide variety of knowledge and experiences andOutside Directors who are expected to provide advice andmonitoring from a broad perspective. As for the selection of
Directors, from among candidates, the Company selects personnel
who meet the same requirements as above, while taking into
account the appropriate balance of the board as a whole, in
accordance with the revised Corporate Governance Code. In
August 2021, a female certified public accountant was appointed
as an Outside Director. This has enabled the Company to secure
diversity and accounting literacy. We believe that the Company’s
Board of Directors achieves appropriate diversity and a properbalance of knowledge, experience and skills, making effective useof expertise possessed by respective board members.

Policies and Procedures for Selecting Officers
The Group’s Board of Director has not established specificprocedures for selection of a CEO.
A CEO candidate is chosen from personnel who are able tocontrol overall management and business operation based on thecorporate philosophy and who have abundant experience andachievements required for contributing to the Group’s sustainablegrowth and to improvement in its corporate value. Suchpersonnel also must have a high level of ability, broad insights anda superior personality. The successful candidate will be selected by
Skill Matrix

Specialization and experience
Name

Age

Term ofSex
officeTeppei Nagata

65

Male

5 years●

Managing Director Hiroaki Usugi

58

Male

2 years●

Position

President

Corporate Governance and CSR Promotion System

Legal
GeneralOverseas Sales andProduction Finance andSustainability
Riskmanagement business marketing
technology accounting management

Director

Toshiro Maruyama

64

Male

1 year●Director

Eiichiro Kimura

63

Male

1 year●Director

Norihisa Murase

61

Male

―

●

Outside Director

Haruo Shimizu

75

Male

6 years●

Outside Director

Kohei Nomura

74

Male

4 years

Outside Director

Koichi Makino

59

Male

1 yearOutside Director

Yumiko Oida

55

Female1 yearCorporate Auditor Kiyokazu Ichikawa

63

Male

2 years

OutsideCorporate Auditor Atsuhiro Sonoda

57

Male

3 years

OutsideCorporate Auditor Takafumi Katayama

60

Male

2 years

●

●

●

●

●

IT
Digital

●

●

●

●

General meeting of shareholders
Selection/dismissal

Selection/dismissal

3 auditors(including 2 outside auditors)

Board of Directors
9 directors

Audit

pe

rat
i

on

Selection/dismissaland supervision
Cooperation

Audit

CSR Promotion System
CSR Promotion Committee

CSR & Internal
Control Council

Compliance & Risk Management
Subcommittee(whose tasks include personal information management)

Central Health and Safety Subcommittee

on

i
rat

Direction andsupervision

Audit

Respective
departments,
Head Office, andGroup companies

Consultation
servicesfor overseas
subsidiaries
Corporate
Ethics Hotline

Human Resource (Development
and Health) Subcommittee
Environmental Promotion Subcommittee
Product Liability (PL) Subcommittee
Financial Control Committee

Corporate Auditors

Meeting ofOperating Officers

peInternal Auditing
Department

Nomination andRemuneration Committee

Representative
Directors
Management
MeetingoCoAccounting auditorCoo(including 4 outside directors)

Directors

Board ofCorporate Auditors

Selection/dismissal

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

* The above is not intended as a complete list of knowledge and experience held by members of the Board of Directors and the Board of Corporate Auditors.
* As of the conclusion of the general meeting of shareholders held in 2022.

45

Suminoe Textile Group Integrated Report 2022

Suminoe Textile Group Integrated Report 2022

46

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Governance

G GovernanceTraining for Officers
Providing Opportunities to Acquire andUpdate Knowledge
Various training opportunities are offered for directors andcorporate auditors to encourage their self-improvement andhelp them acquire and update knowledge necessary for theirrespective duties and operations. And directors and corporate
auditors have been actively participating in such training
programs.
For outside officers, to help them deepen theirunderstanding of the management strategies and businessnature/conditions of the Group, explanations are provided
upon their appointment, and also opportunities to visit
factories/offices and explanations by directors in charge areprovided subsequently as necessary.

Nomination and Remuneration Committee, which is anadvisory organ of the Board of Directors established asnecessary for the purpose of enhancing objectivity andtransparency in the procedures related to the appointment
of directors and the determination of their remunerations
and consists mainly of independent outside directors. Basedon the report from the Committee, these matters are
discussed and resolved at a meeting of the Board of
Directors in which outside directors and outside corporate
auditors are present.
Matters Regarding the Policy for Determining theAmounts and the Calculation Method of Remuneration,etc. of Corporate Auditors
Remuneration of corporate auditors is determined throughconsultation of the corporate auditors within the range of
remuneration determined at a general meeting of shareholders.

Remuneration for Officers
Matters Regarding the Policy for Determining Details ofRemuneration, etc. of Each Director
The Suminoe Textile Group consults the Nomination andRemuneration Committee and, based on the response from theCommittee, resolves the policy to determine details of
remuneration, etc. for each director as follows:(1) Policy for determining the amount of the base salary,
as well as the details and the amount or quantity of
non-monetary remuneration, for each individual
Remuneration, etc. for directors shall be in the amountappropriate in light of their respective duties and the generalstandard and consist of base salary and stock-based
remuneration.
Base salary is paid as monthly fixed remuneration in theamount appropriate for each position within the range of
remuneration determined at a general meeting ofshareholders.
The purpose of stock-based remuneration is to provide
an incentive for directors to work toward sustainableimprovement of the Suminoe Textile Group’s corporate
value and also to promote their sharing of value withshareholders. In view of this purpose, the amount deemed
appropriate within the range of remuneration determined at
the general meeting of shareholders is paid for directors,
excluding outside directors, at a fixed time each year as
remuneration for provision of restricted stock, of which
disposal is not allowed until the directors resign or retire
from the position of director, etc. of the Group.
(2) Matters Regarding Determining Details ofRemuneration, etc. of Each Director
Based on the above policy, allocation of remuneration foreach individual and other matters are discussed at the47

Suminoe Textile Group Integrated Report 2022

Evaluation of the Effectiveness of the Board of Directors
Results of Self-Evaluation Analysis and Matters
Requiring Improvement
The Board of Directors of the Suminoe Textile Group conducted
a questionnaire survey on all of the Board of Directors’ members(directors and corporate auditors) as self-evaluation for the
purpose of analyzing and evaluating the effectiveness of theBoard of Directors while obtaining knowledge of a third-party
organ.
Based on the analysis results of the survey and the relevant
discussions at the Board of Directors’ meetings, it has been
determined that the Group’s Board of Directors properly plays itsrole and satisfies expectations placed on it and that theeffectiveness of the Board of Directors is adequately ensured asdemonstrated in the points below:
1. The size and structure of the Board of Directors (5 internal
directors and 4 outside directors) are appropriate.
2. The Board of Directors’ meetings are operated in an open
manner and have created an atmosphere that encourages
active discussions.
3. The expected roles of outside directors are clear, and theiropinions based on their respective experience andknowledge contribute to governance.
Meanwhile, the matters that need to be improved were pointed
out as follows:
1. Formulation of a plan for the development of successors
2. Provision of training opportunities for directors andcorporate auditors
3. Provision of opportunities for outside directors to exercise
their supervisory function outside the Board of Directors’
meetings
These results of analysis and evaluation will be addressed as theissues for the operation of the Board of Directors’ meetings in thenext fiscal year, and they will also be discussed continuously at
the Board of Directors’ meetings as medium- to long-term issues.
The Suminoe Textile Group’s Board of Directors willcontinue to conduct self-evaluation with the aim of further
improving its functions.

Cross-shareholding
Reasonable and Appropriate Holding
The Suminoe Textile Group implements cross-holding of sharesfor strategic purposes, such as to maintain smooth transaction
relationships and strengthen stable and ongoing ties withfinancial institutions, when it is deemed to contribute toimproving the Group’s corporate value.
Cross-shareholding cases are reported to the Board of
Directors every six months, where the purpose of cross-holding
is verified by examining such matters as whether the yielded
benefits meet the investment made, whether there are any risks,
and whether the shareholding is economically reasonable andappropriate, based on the status of relationship with the Groupand the governance condition of each partner. The cross-heldshares are sold whenever their purpose of holding disappears.
Regarding the exercise of voting rights, although nouniform standard has been established, we believe that proper
exercise of voting rights will lead to the improved corporate
value and sustainable growth of the relevant companies in themedium to long run. Based on this belief, in principle, we
exercise our voting rights with regard to all the cross-holding
shares by determining approval or disapproval of proposals inview of the situation and business relationships of the relevant
companies.
Incidentally, when a company holding shares of theSuminoe Textile Group shows its intention to sell the shares, webasically agree to it.

for Suminoe Textile Co., Ltd. and Suminoe Teijin Techno Co., Ltd.
in October 2022.
We will work to expand the application of the systemthroughout the Group and enhance functions to be preparedfor e-invoicing, among others.

Interactive Communication through “Management
by Walking Around”
Interactive Communication between Employees and Top
Management to Discuss Worksite Problems
The Suminoe Textile Group has been promoting “management
by walking around” since the fiscal year ended May 2018, withthe aim of enabling information-sharing and interactive
communication between top management and employees.
In the “management by walking around” approach, officers(directors and operating officers) visit Suminoe Textile’s offices
and Group companies and exchange opinions with local
employees. In June 2022, President Nagata and Maruyama,
Director and General Manager, Automotive Textiles Business
Headquarters, visited two sites of our U.S. subsidiary. For Nagata,
it was the first time since he became president in August 2021
to look around an important subsidiary in the automotive
interior business as the president.

Suminoe Textile of America Corporation production line

Restructuring of the Core Systems
Restructuring of Systems for Management ofReceivables/Payables and Accounting
The Suminoe Textile Group has been working on the
restructuring of its core systems throughout the Group, which
has been promoted in a top-down manner since November
2018. To improve efficiency of operations while preventing
misconduct, we have been advancing restructuring of various
systems so that our businesses can be visualized.
Restructuring of the receivables/payables management
system and the accounting system was included in thisinitiative. The purpose is to promote paperless through theelimination of forms and to integrate data on balance andparticulars of receivables and payables so that they can be easily
grasped. To start with, the new system was put into operation

Suminoe Textile of America Corporation external view

Suminoe Textile Group Integrated Report 2022

48

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Governance

G Governance
Ensuring Compliance
Basic Policy
Corporate Activities in Compliance with Laws andCorporate Ethics
The Suminoe Textile Group has formulated its Code of Conduct
and its Standards of Conduct, both of which lay out the basic
policy for implementing compliance management.
In keeping with the basic policy, officers and employees of
the Group strive to ensure that their own ways of thinking andbehavior are always in compliance with laws and corporate
ethics.

Compliance Measures
Creating a Corporate Culture to Develop Compliance
Awareness in Daily Operations
The Group carries out various measures to develop complianceawareness among employees.
For example, in April 2017 we issued the Compliance
Guidance (in Japanese, English and Chinese), which was thenrevised in April 2022. The Guidance is used for compliancerelated lectures, which are continuously delivered to employees
when they enter the company and receive level-based training.
Also, at each company of the Suminoe Textile Group, an
employee reads the Code of Conduct aloud at the morning
assembly.

Compliance Training
Continuous Implementation of Compliance Training for
Officers
We implemented compliance training for officers, with external
specialists invited as the lecturers. For example, at training heldon the theme of the “Amended Whistleblower Protection Act,”
officers learned about the purpose and outline of theamendment. They were also lectured on themes related tolabor laws, such as “Harassment,”“Overtime Work” and “Equal Pay
for Equal Work.” We are planning to hold compliance training for
officers twice a year in the future.
Continuous Implementation of Training for Executive
Employees
Training sessions were held for a total of 34 executive
employees, including newly appointed operating officers of theCompany and newly appointed directors of the Group
companies both in Japan and overseas. For these training
sessions, external specialists were invited as the instructors, who
lectured about the duties and responsibilities of officers.
Specific themes included “What Is a Director of a Company?”“The Duties of Directors,” “Corporate Scandals and the
Responsibility of Directors,” and “Types of Corporate Scandals.”
We are planning to implement training for executive employees
three times a year in the future.

49

Suminoe Textile Group Integrated Report 2022

In-house Awareness-Raising regarding Insider Trading
We revised the regulations for preventing insider trading, which
is prohibited by the Financial Instruments and Exchange Act, inorder to reinforce their contents.
The details of the revision were shared with employees
through the intranet and in-house explanatory meetings. We
also provided employees with information on a video that
explains insider trading prevention to raise their awareness. For
executives who have many opportunities to access insider
information, on-line sessions were held to urge them to takeprecautions.
Continuously Implementing In-house Study Meetings
The Group has continuously been holding study meetings on
work-related laws, mainly the Subcontract Act. This fiscal year, a
total of 372 employees took part in these study meetings.

Whistleblowing System
Establishing Whistleblowing Contact Points
The Group has established the Corporate Ethics Hotline as acontact point through which officers and employees can
submit a report, should they find incidences of violation of laws
and regulations or corporate ethics within their companies.
This fiscal year, we improved the Corporate Ethics Hotline
system and revised the regulations on the system operation, in
response to the enforcement of the Amended Whistleblower
Protection Act. The revised regulations include new provisions
regarding “appointing the officer in charge of compliance,”“securing independence of departments that deal withwhistleblowing reports,” “clarifying the responsibility of those
who handle these reports,” “addition of whistleblowers to beprotected” and “prohibiting disadvantageous treatment ofwhistleblowers.”
In addition to holding meetings to explain about thedetails of the revision, we communicated the contents of therevised regulations to employees on occasions of in-housetraining and compliance workshops so that all Group
employees are notified of and encouraged to use these contact
points.
Consultation Services Used (number of consultations received)
Contact point for consultation

2021

2022

Corporate Ethics Hotline (in-house contact point)
Corporate Ethics Hotline (external contact point)
Health counseling services (including harassment
consultations)

1
0

1
0

2

1

Harassment consultation contact point
Total

0
3

3
5

Overseas Risk Management

Risk Management
Risk Management System
Reporting to the Management Meeting after
Deliberation by the Committees Concerned
The Group has established the following risk management
system. The CSR Promotion Committee, which comprises
representatives from respective business headquarters anddepartments, deliberates on matters regarding overall risk
management activities, such as proactive prevention andemergency response measures against risks. The Committee
then reports the deliberation results to the CSR & Internal
Control Council (Management Meeting) to obtain approval.
In implementing internal control, we strive to identify risks,
mainly the risk of material misstatement in financial reports,based on the risks reported from Suminoe Textile Co., Ltd. and
its Group companies in Japan and overseas. The Financial
Control Committee examines the risk assessment results, which
are reported to the CSR & Internal Control Council(Management Meeting). Under this system, we have reduced
risks to a certain level. We will henceforth promote theintroduction of information technology (IT) to improve thesystem to mitigate each risk even further.
CSR & Internal Control Council (Management Meeting)

Deliberation
and reporting

Approval

CSR Promotion
Committee

Deliberation
and reporting

Approval

Financial Control
Committee

Introduction of the Production Management System
We have promoted the introduction of a production
management system to which the above-stated system isapplied, into SPM Automotive Textile Co., Ltd. in China and PT.
Suminoe Surya Techno in Indonesia.
After the system is brought into full operation, its data will
be linked with those of the already introduced financial
accounting system, thereby improving inventory management
accuracy and strengthening internal control.

Implementation Status of Business Continuity Plans(BCPs*)
Implementation of Personal Safety Confirmation Drills
In the event of a disaster, disseminating information tocustomers speedily and accurately is key for us to maintaincustomer trust as a company. Based on this idea, the Group has
been working to establish its business continuity plans (BCPs),
focusing on collecting information, such as that on employees’
personal safety and damage caused by a disaster.
Suminoe Textile Co., Ltd. and SUMINOE Co., Ltd. have held
an annual BCP-based emergency drill at their head officebuildings. In the drill, the personal safety of employees isconfirmed in accordance with the in-house emergency contact
rules. On September 2, 2022, these two companies carried out
personal safety confirmation drills, and the emergency
headquarters was able to swiftly confirm the safety of all
employees.
* BCP: Stands for “Business Continuity Plan,” a plan developed to ensure that acompany can continue and/or restore business operations in an emergency,such as a disaster or an accident.

Intellectual Property

Risk Management in Japan
Application of the Production Management System to
Various Departments
We are working to gradually introduce a production
management system that is specifically tailored to the textile
industry to various departments in Japan. The system has now
been in full-scale operation at the Traffic Facilities Business
Headquarters and the procurement department of Suminoe
Teijin Techno Co., Ltd. The Group believes that this system will
be instrumental in establishing a structure that integrates
production and sales functions by visualizing three statuses: theorder status from sales to procurement; production status fromprocurement to sales; and the inventory status. Going forward,
we plan to apply this production management system acrossthe Group.

Promoting Awareness of Intellectual Property Rights
Intellectual property rights include patents, utility model rights,
design rights and trademarks, with each of them having
different protection targets and periods. To ensure that
employees obtain an accurate understanding of intellectual
property rights, we require all employees to receive education
about these rights at the time of joining the company. In
addition, at regular technical meetings held between
employees working at the Nara Factory of Suminoe Techno Co.,
Ltd. and at the Head Office of Suminoe Textile Co., Ltd.,
information on the patents of other companies is shared among
participants.
We will continuously conduct intellectual property
education in the future in order to protect the intellectual
property rights owned by the Group.

Suminoe Textile Group Integrated Report 2022

50

ESG Initiatives in Line with the Medium- to Long-term Management Targets
Messages from Outside Directors

Haruo Shimizu
Outside Director

Importance of Using the Lessons Learned from
Globalization for Future Growth

Leveraging Work Experience in a B2C Company
to Enhance the “Suminoe Textile Brand” ValueI am Haruo Shimizu, and I have been an Outside Director of the Company since August
2016.
Throughout the last six years, I have realized anew that Suminoe Textile is a“100-year-old company” that has an outstanding brand and high-quality customers.
Meanwhile, in this rapidly changing age of global competition, companies capable ofproactively anticipating future market needs will be able to survive.
Fortunately, the Group has established operation sites on a global basis, and its global
business growth will be the main driver of the Group’s medium- to long-term expansion. I
believe that what is important is how to utilize local business practices and know-how that
the Group has learned from globalization in formulating the next strategies. I would
recommend that these strategies should not be based on the idea that the headquarters inJapan will provide instruction to overseas subsidiaries. Rather, the Japanese headquarters
should sincerely adopt the speediness, youthfulness, IT capabilities and other advantages
possessed by emerging countries where the Group is already in operation. I feel that taking
such an approach will allow the Group to develop the ability to anticipate future market
needs to satisfy them ahead of competitors.
I look forward to further growth of the SUMINOE brand.

As described in the invitation to this year’s ordinary general meeting of shareholders, whatis expected of me is to contribute to further enhancing the Company’s corporate
governance, leveraging my experience and knowledge accumulated by working for
Takashimaya Co., Ltd. I am aware that the Company entrusted this role to me largely
because of my expertise in managing a Takashimaya group company and working in thesales and marketing area. However, initially, I asked myself repeatedly how I could utilize myexperience in a B2C (business to consumer) company mainly engaged in the department
store business for the Suminoe Textile Group, which is a manufacturer. Honestly, I don’tknow a lot about technology, but now I think I can play a different role from other directors
by expressing my opinions from the viewpoint that I have developed in the retailingindustry, because the Company runs the Interior Fittings, Automotive Textiles and Traffic
Facilities, and Functional Materials businesses, all of which handle products that are directly
related to end-consumers.
For example, in the Interior Fittings business, which holds a nearly 40% market share,
the Group offers various products ranging from carpet tiles made of recycled materials andgeared for hotels and commercial facilities to home-use rugs. Nevertheless, I feel that theCompany and its brand name are still not much known to general consumers. I would
therefore like to strive to enhance the Suminoe Textile brand value by increasing the namerecognition of the Group’s household products in the Interior Fittings and Functional
Materials businesses.

Koichi Makino
Outside Director

Challenges of SUMINOE and “Responsible
Production and Consumption”

Kohei Nomura
Outside Director

51

Suminoe Textile Group Integrated Report 2022

The immediate task is for the Suminoe Textile Group to meet the continued listing criteria
for the Prime Market. The Group is also faced with a medium- to long-term challenge, that
is, achieving the “SUMINOE GROUP WAY 2022-2024-2027” management targets.
In 2011, the Group launched the development of high-quality carpet tiles using
recycled waste carpet tiles as raw materials. After having undergone many hardships, theGroup succeeded in commercialization of the ECOS® series, eco-friendly carpet tiles under
the horizontal recycling system. Featuring an extremely high recycled material ratio (up to78%), ECOS® has now become the Suminoe Textile Group’s flagship product that is friendly
to the environment. To resolve the two challenges mentioned at the beginning, it isnecessary to strongly promote ECOS® and other eco-friendly products in the B2B(business-to-business) market. To this end, the Group should facilitate the sale of theseproducts through the effective use of human resources by proactively appointing young
and highly motivated employees to important positions or business projects, regardless ofgender.
The Suminoe Textile Group is an advanced enterprise that has aggressively addressed
urgent global themes, such as the SDGs. Since an early stage, the Group has implemented
initiatives to fulfill “Responsible Production and Consumption” in support of Goal 12 of the
SDGs. I believe that what is required now for the Group is to conduct business intended topassionately demonstrate its own strengths to many customer companies and households.

Contributing to Governance Improvement
Based on External, Objective Perspectives andSpecialist Skills

Yumiko Oida
Outside Director

My roles to play as an Outside Director
I understand that I have three roles I am required to play. The first is to act as a “specialist” infinancial & accounting, legal and auditing fields. The second is to secure “diversity.” As the only
female Director for now, I’m willing to raise questions and offer advice based on my values
and perspectives, which differ from those of other Directors. The third is to provide an external
perspective. In the midst of growing public expectations for companies, particularly thoselisted on the Prime Market, it is extremely important for the Company to promote initiatives
for ESG investment and the SDGs, both of which constitute global themes. Drawing on myexperience in serving as outside officers at other companies, I will actively collect information
to help improve governance of the Company as one of its Outside Directors.
Ideal state of the Company’s Board of Directors
Of the nine Directors of the Company, four are Outsider Directors (including one female)
who are specialized in different areas. As for the Company’s Nomination and Remuneration
Committee, a majority of its membership comprises independent outside directors. While
the Board of Directors is highly regarded for its effectiveness, it is desirable that theCompany further promote “diversity of Directors.”
What I expect of the Group in the future
The Company has a long history and a corporate culture that is very positive toward resolvingsocial issues. The Company’s uniqueness is also reflected in its philosophy for productdevelopment, etc. I hope that the Group will continue to place particular focus on improving
the quality of products and services it offers while anticipating social needs in the future.

Suminoe Textile Group Integrated Report 2022

52

Board of Directors and Corporate Auditors

Directors

Teppei Nagata
President

Hiroaki Usugi
Managing Director
Representative Director

Toshiro Maruyama
Director

53

As of August 30, 2022

April 1980
Joined the Company.
August 2012
Operating Officer
General Manager, Functional Materials
Business Headquarters
November 2016
General Manager, Corporate Planning
Department
General Manager, CSR Promotion Department
August 2017
Director
Senior Operating Officer
August 2019
General Manager, Interior Fittings Business
Headquarters
President and Representative Director,
SUMINOE Co., Ltd.
August 2021
President and Representative Director(present)
Chairman and Representative Director,
SUMINOE Co., Ltd.

April 1986
Joined the Company.
August 2010
General Manager, Accounting Division
August 2017
General Manager, Purchasing Department(present)
Operating Officer
August 2019
Senior Operating Officer (present)
Deputy General Manager, Administration
Headquarters
January 2020
General Manager, Corporate Planning
Department (present)
August 2020
Director
August 2021
Managing Director and Representative
Director (present)
General Manager, Administration
Headquarters (present)

April 1981
Joined the Company.
August 2013
Operating Officer
February 2017
Department Manager, Automotive Textile
Business Headquarters
August 2017
Senior Operating Officer (present)
August 2021
Director (present)
General Manager, Automotive Textiles Business
Headquarters (present)
President and Representative Director,
Suminoe Teijin Techno Co., Ltd. (present)CEO, Suminoe Textile of America Corporation(present)
Chairman, SPM Automotive Textile Co., Ltd.
(present)
CEO, T.C.H. Suminoe Co., Ltd. (present)

Suminoe Textile Group Integrated Report 2022

Eiichiro Kimura

April 1982
Joined the Company.
August 2013
Operating Officer
August 2018
Representative Director, Suminoe Techno Co.,
Ltd. (present)
General Manager, Development Department(present)
August 2019
Senior Operating Officer (present)
August 2021
Director (present)

Kohei Nomura
Outside Director

Director

April 1977
Opened Nishikawa & Nomura Law Office (nowNomura & Partners). (present)
June 2015
Outside Director, MKSystem Corporation(present)
September 2015
Outside Auditor, JTEC Corporation (present)
June 2016
Outside Director, Audit and Supervisory
Committee Member, ALINCO INCORPORATED(present)
August 2018
Outside Director of the Company (present)

Auditors

Kiyokazu Ichikawa
Corporate Auditor

Independent Director

Norihisa Murase
Director

Haruo Shimizu
Outside Director
Independent Director

April 1983
Joined the Company.
June 2007
Manager, Sales Department, Kinki Block,
SUMINOE Co., Ltd.
July 2007
General Manager, Kinki Block, SUMINOE Co.,Ltd.
August 2020
Operating Officer
August 2021
Senior Operating Officer (present)
Deputy General Manager, Interior Fittings
Business Headquarters
President and Representative Director,
SUMINOE Co., Ltd. (present)
Department Manager, Sales Department,
SUMINOE Co., Ltd. (present)
August 2022
General Manager, Interior Fittings Business
Headquarters (present)

February 1970
Joined Daikin Mfg. Co., Ltd. (current Exedy
Corporation)
June 1994
Director, Daikin Mfg. Co., Ltd.
June 2006
President and Chief Executive Officer, Exedy
Corporation
April 2015
Chairman, Exedy Corporation
June 2016
Corporate Advisor, Exedy Corporation
Outside Director (in charge of Audit
Committee), Bando Chemical Industries, Ltd.
(present)
August 2016
Outside Director, Suminoe Textile Co., Ltd.
(present)
June 2019
Outside Director, Ashimori Industry Co., Ltd.
(present)

Koichi Makino

April 1985
Joined Takashimaya Co., Ltd.
February 2013
Kashiwa Store Manager, Takashimaya Co., Ltd.
March 2019
Operating Officer and Shinjuku Store Manager,
Takashimaya Co., Ltd.
March 2021
Senior Operating Officer and Deputy General
Manager, Merchandising Headquarters,
Takashimaya Co., Ltd. (present)
August 2021
Outside Director of the Company (present)

Outside Director

Yumiko Oida
Outside Director
Independent Director

Atsuhiro Sonoda
Outside Corporate
Auditor

October 1994
Joined Asahi & Co. (now KPMG AZSA LLC).
April 1998
Registered as a certified public accountant.
August 2008
Director, BRAIN Co., Ltd. (present)
November 2008
Registered as a licensed tax accountant.
June 2019
Outside Director, Audit and Supervisory
Committee Member, SHOEI CORPORATION(present)
June 2020
Outside Director, COTA CO., LTD.
August 2021
Outside Director of the Company (present)

Takafumi Katayama
Outside Corporate
AuditorAs of August 30, 2022

April 1982
Joined the Company.
February 2004
General Manager in charge of Production in
Nara
September 2013
Director, T.C.H Suminoe Co., Ltd.
August 2018
Operating Officer
EVP, Suminoe Textile of America Corporation
January 2020
General manager, Quality Assurance
Department
Manager, Technical Center
August 2020
Corporate Auditor (present)

April 1988
Joined Takashimaya Co., Ltd.
March 2009
Transferred to Takashimaya Space Create Co., Ltd.
March 2011
Deputy Department Manager, General Affairs
Department, Takashimaya Space Create Co., Ltd.
March 2016
Manager of Accounting, Accounting
Department, Takashimaya Space Create Co., Ltd.
September 2016
Assistant Manager of Finance, Financial
Department, Planning Division, Takashimaya Co.,
Ltd.
October 2018
Manager of Finance, Financial Department,
Planning Division, Takashimaya Co., Ltd.
March 2019
Deputy Manager, Financial Department, Planning
Division, Takashimaya Co., Ltd. (present)
August 2019
Outside Corporate Auditor of the Company(present)

May 1991
Joined Marubeni Corporation.
April 2013
Deputy General Manager, Fashion Apparel
Department No2, Marubeni Corporation
April 2014
General Manager, Functional Materials
Department, Marubeni Corporation
April 2017
General Manager, Functional Textile
Department, Marubeni Corporation
June 2020
President and Representative Director,
Marubeni Intex Co., Ltd. (present)
August 2020
Outside Corporate Auditor of the Company(present)

Suminoe Textile Group Integrated Report 2022

54

Eleven-year Consolidated Financial Summary

Each FY ended May 31

2012

2013

2014

2015

75,31881,873

88,21991,182

97,52996,03897,872

98,61791,51279,702

81,713Operating income (Million yen)

899

1,921

2,809

3,101

2,553

1,297

2,247

3,118

1,557

1,049

110

Operating margin (%)

1.2

2.3

3.2

3.4

2.6

1.4

2.3

3.2

1.7

1.3

0.1

1,133

2,291

3,401

3,729

2,883

1,364

2,358

2,956

1,323

1,211

950

223

1,045

1,968

1,815

245

26

1,083

467

142

409

281

2,146

3,224

4,449

4,964

4,447

2,917

3,973

4,888

3,588

3,028

2,026

Cash flows from operating activities (Million yen)

670

3,837

4,479

3,701

1,453

983

3,519

4,760

5,901

4,167

375

Cash flows from investing activities (Million yen)

-1,889-1,676-1,221-1,231-3,211-2,170-244-1,448-1,536-754-1,191

Free cash flow (Million yen)

-1,218

2,160

3,257

2,470

-1,757-1,186

3,274

3,311

4,365

3,413

-816

310

-2,048-895-2,756

119

354

-843

-4,964-1,702-3,174-2,074

Total assets (Million yen)

76,286

79,90185,841

90,12686,87890,254

92,182

87,97586,272

83,66984,801

Interest-bearing debts (Million yen)

16,433

15,483

15,501

15,134

16,95918,946

19,396

18,54820,184

18,68918,999

Shareholders’ equity (Million yen)

18,61919,597

21,552

22,86022,614

22,111

22,664

20,56018,641

18,87819,711

24.4

24.5

25.1

25.4

26.0

24.5

24.6

23.4

21.6

22.6

23.2

Profit per share (EPS) (Yen)

2.95

13.85

26.09

24.07

3.25

3.50

143.66

65.36

21.88

64.84

44.44

Book value per share (Yen)

341.89385.46409.77466.15441.61441.23

4,515.26

4,469.04

4,438.11

4,438.67

4,470.49

5

5

6

6

7

7

―

70

50

35

70

169.5

36.1

23.0

24.9

215.4

―

48.7

107.1

228.5

54.0

157.5

0.9

3.8

6.6

5.5

0.7

0.1

3.2

1.4

0.5

1.5

1.0

Capital expenditure*2 (Million yen)

2,043

1,571

1,502

1,422

820

2,722

1,171

1,617

3,516

2,677

4,636

Depreciation (Million yen)

1,246

1,302

1,640

1,862

1,893

1,620

1,725

1,769

2,030

1,979

1,915

R&D expenses (Million yen)

270

405

371

380

348

289

268

254

1,117

948

984

2,292

2,401

2,554

2,604

2,786

2,830

2,850

2,899

2,822

2,724

2,640

2016

2017

2018

2019

2020

2022

2021

Operating results
Net sales (Million yen)

Ordinary income (Million yen)
Profit attributable to owners of parent (Million yen)
EBITDA (Million yen)
Cash flows

Cash flows from financing activities (Million yen)
Financial position

Shareholders’ equity ratio (%)
Per share data*1

Annual dividend per share (Yen)
Payout ratio (%)
Other data
Return on equity (ROE) (%)

Number of employees*1 The Company consolidated its common shares at a ratio of 10 shares to 1 share, effective December 1, 2017. Considering the impact of the share consolidation, the value of the annual dividend per share for the fiscal*2 Capital expenditure for the fiscal year ended May 2020 and later includes not only property, plant and equipment, intangible assets, and investments but also an increase in leased assets owing to the application of

55

Suminoe Textile Group Integrated Report 2022

year ended in May 2018 is omitted.
IFRS 16 “Leases.”
Suminoe Textile Group Integrated Report 2022

56

Corporate Summary and Investor Relations

Operation Sites of the Suminoe Textile Group

Group companies in Japan (head offices)❶ Suminoe Textile Co., Ltd. (Osaka City)❷ SUMINOE Co., Ltd. (Osaka City)

Overseas Group companies

Planning and sales of interior products, mainly carpets and curtains

China❸ RUNON CO., LTD. (Tokyo)❷ Suzhou Suminoe Koide Automotive Accessories Co., Ltd.

❹ Suminoe Logistics Co., Ltd. (Ikoma-gun, Nara Prefecture)

Planning and sales of interior products, mainly wallpapers❶ SPM Automotive Textile Co., Ltd. Guangzhou

Product storage, handling, processing, and delivery❸ Suzhou Suminoe Textiles Co., Ltd.

❺ Suminoe Works Co., Ltd. (Tokyo)❹ Suminoe Textile Shanghai Co., Ltd.

Installation of interior products

India

12
13

11

❺ Suminoe Teijin Techno Krishna India Pvt. Ltd.

❻ Kansai Laboratory Co., Ltd. (Matsubara City, Osaka Prefecture)
Testing and inspection services❼ Suminoe Teijin Techno Co., Ltd. (Osaka City)

2 3 4

Vietnam❻ Suminoe Textile Vietnam Co., Ltd.

5

Thailand6

Production and sales of automotive textiles, mainly seat covering materials❽ Marunaka Souei Co., Ltd. (Osaka City)

1

Wholesale of traffic facility textiles

14❾ Suminoe Techno Co., Ltd.

7
8

❼ Suminoe Koide (Thailand) Co., Ltd.
❽ T.C.H. Suminoe Co., Ltd.

Production and processing of carpets, continuous fiber spinning (including recycling),
and production and processing of needle punch carpets
Shiga Factory (Koka City, Shiga Prefecture)
Nara Factory (Ikoma-gun, Nara Prefecture)

Offices/Factories of Suminoe Textile Co., Ltd.
Head Office (Osaka City)

Indonesia

10 TANGO TEXTILE Co., Ltd. (Kyotango City, Kyoto Prefecture)●

Tokyo Branch (Tokyo)❾ PT. Sinar Suminoe Indonesia

9 10❿ PT. Suminoe Surya Techno

Production and sales of plush hand-woven curtains, hand-woven carpets and hooked rugs, and other rugs

11 Teijin Tecloth Ltd. (Inazawa City, Aichi Prefecture)●

Nara Factory (Ikoma-gun, Nara Prefecture)

Production and sales of automotive seat covering materials, chair upholstery fabrics, and clothing textiles

Shiga Factory (Koka City, Shiga Prefecture)

12 Owari Seisen Co., Ltd.
●

United States

Kyoto Traditional Art and Craft Factory (Kyoto City)⓫ Suminoe Textile of America Corporation (C.A. Design)

East Tokyo Sales Office (Wako City, Saitama Prefecture)⓬ Suminoe Textile of America Corporation

West Tokyo Sales Office (Isehara City, Kanagawa Prefecture)⓭ Bondtex, Inc.

Nagoya Sales Office (Nagoya City, Aichi Prefecture)

MexicoFukuoka Sales Office (Fukuoka City)

Dyeing and finishing of automotive seat covering materials and interior fabrics
Head Office (Ichinomiya City, Aichi Prefecture)
Ishikawa Factory (Nomi City, Ishikawa Prefecture)

13 Sewing Hyogo Co., Ltd. (Tamba City, Hyogo Prefecture)●

Hiroshima Sales Office (Hiroshima City)

Sewing and processing of fabric products⓮ Suminoe Textile de Mexico, S.A. de C.V.

5

❾ 4

12
●

17
●
12
●
11
●

10
●
13
●

10

❶
❷
❼
❽

Automotive Textiles

Traffic Facilities

Functional Materials

Arts and Crafts Textiles

1

Development, design and sales of test equipment and measuring instruments

15 CPO Co., Ltd. (Tokyo)●

Interior design, construction and supervision, manufactureand sale of custom-made furniture

16 PRETERIOR-TEXTILE Inc. (Osaka City)●

Interior finish work and sales of interior options

❹
❾

16

Interior Fittings

❸❺⓯ 2

❻

14

9

6

14 INTEC CO., LTD. (Osaka City)●

3

17 Seki Textile Co., Ltd. (Seki City, Gifu Prefecture)●

Production and sales of automotive textiles and traffic facilities textiles

8

7

Sales offices of each business segment● Interior Fittings● Automotive Textiles● Traffic Facilities● Functional Materials● Suminoe Interior Plaza (showroom)

Corporate Summary (As of May 31, 2022)
Company Name

Suminoe Textile Co., Ltd.

Fiscal year end

May 31 each year

Head Office

11-20, Minami-Semba 3-Chome, Chuo-ku,
Osaka 542-8504, Japan

Annual General Meetingof Shareholders

Late August each year

Founded1883

Share unit number

100 shares

Incorporated

December 25, 1913

Stock listings

Tokyo Stock Exchange, Prime Market

Securities code

3501

Shareholder registryadministrator

Mizuho Trust & Banking Co., Ltd.

Accounting auditor

KPMG AZSA LLC

Suminoe Textile Joint-Stock Company

57

Shareholder Distribution

OrganizationalchangeDecember 26, 1930
Suminoe Textile Co., Ltd.

Capital¥9,554,000,000

Number of
employees

256 (Consolidated group companies: 2,640)

URL

https://suminoe.co.jp/en/

Number of
consolidated
subsidiaries

29

Number ofequity-method
affiliates

2

Suminoe Textile Group Integrated Report 2022

Major Shareholders
Financial institutions

Individuals and others

19.71%

48.62%

Financial instruments
business operators

2.00%

Other corporations

28.29%
Foreign investors(individuals)

0.02%

Foreign investors(excluding individuals)

1.36%

Stock Information
Authorized shares

30,000,000

Issued shares

7,682,162

Number of shareholders

7,566

Number of shares(Thousands)

Percentage of total
shares outstanding (%)

Takashimaya Company, Limited

924

14.61

Nippon Life Insurance Company

476

7.53

Marubeni Corporation

366

5.79

The Master Trust Bank of Japan, Ltd.
(Trust account)

323

5.10

Hayashi Telempu Holdings Corporation

233

3.68

The Master Trust Bank of Japan, Ltd. (as trustee
for Retirement Benefit Trust of UNITIKA LTD.)

178

2.82

Suminoe Textile Kyoeikai

155

2.46

Suminoe Textile Employee’s Association

150

2.37

Toray Industries, Inc.

129

2.05

Meiji Yasuda Life Insurance Company

115

1.82

Name

*1 Fractions of less than 1,000 were disregarded in the numbers of shares held.
*2 Suminoe Textile Co., Ltd. has treasury stock (1,350,807 shares) but is not included in the above
list of major shareholders.
Treasury stock is excluded from the calculation of the percentages of share ownership.
Suminoe Textile Group Integrated Report 2022

58