Management

CSR Report

In an effort to continuously enhance its corporate value, the Company is striving to ensure transparencyof management and compliance, along with the maintenance and operation of an adequate governanceframework while reinforcing its risk management framework.
Business Principles

Prioritize ethics and contribute to the prosperityof customers and society as a whole
Encourage creativity and enterprising spirit tomeet the challenges of the future
Build trust by focusing on quality first

Code of Conduct

1. Respond to customers in a timely and speedy manner
2. Tackle all challenges with forethought and creativity
3. Continuous efforts toward self-development and skill
improvement
4. Keep a broad perspective and influence each othertoward growth
5. Act with awareness and pride of a good member ofsociety and businessman
Established in June 2001

Corporate GovernanceOur philosophy of corporate governanceManagement

16 Corporate Governance17 Internal Control/Compliance
18 Risk Management
18 Information Security
18 Business Risk

Report by Stakeholder

20 With Our Customers
21 With Our Suppliers
22 With Our Shareholders and Investors
23 With Our Employees

Actions to Deal with the Environment and Local Communities

26 Actions to Protect the Environment
30 Contributions to Local Communities
15

The Group’s business activities are based on the businessprinciples that “prioritize ethics and contribute to theprosperity of customers and society as a whole.” We
therefore strive to attain sound corporate management
through strengthening and reinforcing corporate
governance, fully appreciating the significance ofcompliance based on corporate ethics. At the same time,
we review as appropriate our management monitoring
system to ensure its conformity to the changes in thebusiness environment including social environment andrelevant legislation.

Corporate governance
We are a company with a board of statutory auditors,
furnished with corporate bodies established in accordancewith laws and regulations as well as the Articles ofIncorporation, and include the Board of Directors,
Statutory Auditors, the Board of Statutory Auditors,
Accounting Auditors, along with the General Meeting of
Shareholders and Directors. At its regular monthly
meetings as well as extraordinary meetings held whenappropriate, the Board of Directors discusses and decides
on important management matters such as reports on
Directors’ business execution and matters to be decided
solely at the discretion of the Board of Directors, while
supervising Directors’ business execution. In addition, theCompany has meeting bodies including the Management
Strategy Meeting and Executive Officer Liaison Meeting.
Through these bodies, critical management matters
including matters related to their execution of duties and/or those subject to the deliberation of the Board of
Directors are reported to the President by the generalmanagers of business execution departments, and aredeliberated and discussed preliminarily.

Internal audit and statutory auditor’s audit
Action plans and results of internal audits are reported to
the Board of Directors and Statutory Auditors by the Audit

Division under the direct control of the President as afunction independent of all business operations subject toaudit, as part of an effort to reinforce corporate
governance. Statutory Auditors hold preliminary meetings
with Accounting Auditors after the Ordinary General
Meeting of Shareholders to exchange opinions regarding
the audit plan. Statutory Auditors receive the results ofquarterly reviews from Accounting Auditors both verballyand in writing, and confirm their action plans (if required by
the reviews) to be taken at a fiscal year-end audit.
Statutory Auditors also receive the results of the reviewson the fiscal year-end audit from Accounting Auditors in a
s t a t u t o r y d o c u m e n t a l o n g w i t h v e r b a l re v i e w s .
Furthermore, Statutory Auditors are in principle required to
be present at inventory taking or on-site inspection at
subsidiaries by Accounting Auditors.

External Statutory Auditors and Outside Directors
Although the Company has established neither guidelines
nor policies regarding the independence required for a
candidate for its External Statutory Auditor, we used thecriteria for the independence of members of an
independent committee established by stock exchanges
as a reference in appointing the External Statutory
Auditors, who have excellent insight in their areas ofexpertise. The Company appointed three External
Statutory Auditors, each of whom is playing a role toenhance audit functions required by laws and regulations
while independent from the Company.
Mr. Hiroshi Hamao and Mr. Eiichi Suzuki, our External
Statutory Auditors, are engaged in the auditing activities
for the Company, drawing on their wealth of experienceand broad knowledge developed in corporate
management and service at a financial institution.
Mr. Toshio Ikeda, our External Statutory Auditor, is acertified public accountant who utilizes his professional
expertise in the area of corporate financial accounting for
the Company’s auditing work. Meanwhile, the Company
has appointed Mr. Ikeda as an independent director andregistered him as such at stock exchanges.
Toyo Denki Seizo Report 201416

Management

The Board of Directors consists of Directors who arefamiliar with the Company’s business operations, so thatmaintenance and enhancement of management efficiency
can be ensured. External Statutory Auditors are in place tothoroughly perform auditing functions to ensure
management soundness. As such, the Company has notappointed Outside Directors as of the date of submission.

each Director’s contribution to management as well as
business results of the Company. Basic remuneration forboth Standing and Part-time Statutory Auditors is a fixedsalary without bonus payments.
-As of the end of May 2014Number of executives Total amount of remuneration
applicable(Unit: Million yen)
7
147

Category of executives

Executive remuneration
Amounts of remuneration for Directors and Statutory
Auditors are decided by a resolution at the General
Meeting of Shareholders. Basic remuneration for Directors
is a fixed salary while a bonus is payable as determined by

Directors
Statutory Auditors (excluding
External Statutory Auditors)
Outside Executives (External
Statutory Auditors)

2

27

2

11

Basic policy
General Meeting of Shareholders

Accounting Auditors

Reporting

ReportingAppointments/dismissals

Board of Statutory Auditors

Reporting

Legal audit

Instruction/reporting

Internal Control Oversight Committee
Appointments/reporting(Secretariat)
General Affairs Division(Contact for whistle-blowers)(Contact for legal consulting)

Whistle-blowings

Reporting on business execution

Promotion framework

President

Reporting/decisions

Internal audit

The Company is engaged in developing rules and aframework for risk management according to the Basic
Rules for Risk Management established in August 2006.

Directors
Appointments/dismissals

Business audit

Accounting audit

Audit Division

Appointments/dismissals

Board of Directors

Statutory Auditors
ReportingManagement Strategy Meeting
Executive Officer Liaison Meeting
National and Global Group Company Meetings

Compliance education
The Company is organizing scheduled and systematictraining sessions based on a compliance training masterplan to enhance knowledge on compliance while
promoting a conscious respect for corporate ethics.

Risk Management

Corporate governance framework
Appointments/dismissals

conduct. The move is part of an effort to have the codeand the basic rules of work fully known.
The Company has also introduced a whistle-blowing
system that allows employees to provide information
directly to the management. The system is aimed atensuring that any illegal or inappropriate conduct within
the Company is detected at the earliest possible stage
and that adequate measures are taken promptly and asneeded so that such conduct is rectified.

Appointments/
dismissals

The Company has established the Internal Control
Oversight Committee, an advisory body chaired by the
President and has some of its authority delegated from theBoard of Directors. It analyzes and assesses all the risks
that exist in the Group and develops an effective risk
management framework capable of dealing precisely withthe risks of the types and degrees that the Group is
exposed to. The committee specifically reviews the way
such a risk management framework ought to be, and it
reports periodically to the Board of Directors on therecommendations resulting from its deliberations.
Furthermore, the committee is committed to enhancing
t h e G ro u p - w i d e r i s k m a n a g e m e n t f r a m e w o r k i n
accordance with the Basic Rules for Risk Management.

Instruction/reporting

Executive Officers (including those concurrently serving as Directors)
Instruction/reporting

Each business department
Oversight

Instruction/reporting

Instruction/
reportingInformation Security

Each Group company

Basic policy

Internal control and complianceInternal control
The Company has developed an internal control system
based on the Rules for the Internal Control OversightCommittee established in June 2006. The system
reasonably ensures the achievement of objectives
including effectiveness and efficiency of operations,reliability of financial reporting, compliance with relevantlaws and regulations and protection of corporate assets.
The Company has also introduced a self-inspection
system to enhance monitoring so that an effectivefunctioning of internal control can be ensured.
Furthermore, the Company has developed andoperates an internal control system appropriately toensure the reliability of its financial reporting, based on the
Financial Instruments and Exchange Act (the so-called
J-SOX Law). Accordingly, we determined that the internal
control with respect to the Group’s financial reporting was
effective as of fiscal 2013, and we submitted an internal
control report to the relevant authorities in August 2014.

17

The report has been endorsed as adequate by an audit
report submitted by the Accounting Auditor. The reporthas been endorsed as adequate by an audit reportsubmitted by the Accounting Auditor.

Principles of compliance
The Company has set “1. adherence to rules,” “2.
observance of confidentiality,” “3. distinction between
private and public matters,” “4. strictness with money,” “5.
p ro h i b i t i o n o f s i d e j o b s , ” a n d “ 6 . p ro h i b i t i o n o f
discriminatory and sexually suggestive statements or
behavior” as principles of compliance.

Compliance promotion framework
To focus on business principles and fulfill its social
responsibility, the Company has provided all officers andemployees with a copy of the Compliance Manual (ToyoDenki Seizo Ethical Standards) that stipulates its code of

The Company holds a vast amount of information assets
including information presented by customers related toits business execution and confidential information
concerning the Group’s proprietary technologies and its
trade. Each Group company is taking various measures inthis respect based on an awareness of shared security
under the Group’s Information Security Guidelines, whichhave been established to adequately manage and use
these information assets.

Information security training
The Company is conducting educational activities todevelop information security awareness among all
employees including various training sessions, someinvolving the use of educational DVDs.

Risk Factors
From the perspective of proactive information disclosure,t h e G ro u p i n t e n d s t o d i s c l o s e a w i d e r a n g e o frecognizable risks. Major risks that may affect its earnings
and financial position are set out below. The Group aims
for thorough understanding of these risks in order toestablish a necessary risk management framework
designed to prevent the risks from materializing or
minimize the impact of risks if they do materialize.

(1) Business activities, business structure, economic
trends, and other factors
The Group’s sales heavily rely on the Transportation
Systems and Industrial Systems segments. Its
customers conduct business operations at home andoverseas. As such, business climates and individual
spending conditions in different countries may affect
the Group’s business performance.

Toyo Denki Seizo Report 201418

Management(2) Production bases
The great majority of the Group’s production bases arelocated in the Kanto area. Production capacity may be
severely affected by large-scale disasters in the area.
(3) Intensifying competition
The Japanese market for the Transportation Systems
segment has matured and thus faces intensifying
competition. The Industrial Systems segment is underpressure from intensifying competition for productdevelopment. The Group’s business performance may
be affected by such intensifying competition.
(4) Product quality
Defects in products may link to materialization of a riskthat requires large-scale compensation for damages.
The possibility exists that insurance may not be able tocover associated costs, which may affect the Group’sbusiness performance.
(5) Product development
With a view to providing attractive products tocustomers, the Group applies itself to gathering
information about customer needs and leverages it in
the development of new products to support its future
growth. However, delays in the development of new
products to respond to rapid technological orenvironmental changes may affect the Group’s
performance.
(6) Material procurement
Owing to the fact that the Group’s business hasvarious distinctive characteristics, some of thematerials it procures are not easily available due tofactors such as a limited number of suppliers. Delays
in supply or discontinuation in production of suchmaterials may affect the Group’s performance. In
addition, disruptions to the entire supply chain caused
by a large-scale disaster or other incidents could
impact the Group’s operations. Moreover, its businessmay be affected by the fluctuation in prices of raw
materials, notably steel products and copper.
(7) Overseas expansion
The Group proactively pursues the expansion ofoverseas operations including the Chinese market. Its
performance may be affected by major changes insituations overseas.
(8) Intellectual property rights
The Group attends to the protection of intellectual
property rights. However, amid drastically advancing
technical innovations and accelerating globalization ofbusiness, the Group is inevitably exposed to potential
disputes with third parties over intellectual property
rights. If a dispute occurs, the Group’s business may
be affected.
(9) Business alliances
With the aim of business expansion and enhancing
competitiveness, the Group proactively pursues
various alliances with third parties. However, if these
alliances do not deliver expected results due to a
failure in forging favorable relationships with partners,
the Group may face an impact on its performance.
(10) Exchange rate fluctuations
On the back of aggressive expansion into overseas
markets, the Group will inevitably face heavier impact

19

Report by Stakeholder

of foreign currency exchange rate fluctuations on its
earnings as it increases foreign currency denominatedtransactions.
(11) Holding assets
Fluctuations in the fair value of assets held by theGroup may affect its performance.
(12) Financing
The Group’s financing programs may be affected by
unexpected changes in financial conditions.
(13) Information security
The Group retains customer information related to its
business executions. Also, it possesses various typesof confidential information concerning the Group’s
proprietary technologies and operations. If theseinformation assets leak outside the Group for
unforeseeable reasons, it may impact its performance.
(14) Compliance
The Group proactively pursues expansion in overseas
operations, particularly the Chinese market; therefore
its operations are subject to the laws and regulationsof each country. Although the Group has establishedand conducts a robust compliance system, its
operations are still at risk from the effects of
unforeseeable events.
(15) Litigation
If the Group becomes the subject of any legal action
or other legal procedures, its business may beaffected.

With Our Customers
The Company makes it one of our business principles to “build trust by focusing on quality first.” As such, we
strive to enhance customer satisfaction through our commitment to thorough-going quality control as we believedelivering safe and secure products and services to customers is the Company’s most important mission.

Quality Control– Providing Safe and High-Quality Products
Basic policy on quality control
The Company’s electrical equipment for rail vehicles isinstalled in many rail vehicles. These extremely important
products play a direct role in ensuring the safety of humanlife and property during rail transportation. In the Industrial
Systems and Information Equipment Systems segments
as well, the Company’s products and services are used incustomers’ production facilities, development sites and in
the field of social infrastructure, and they form thefoundation supporting the sustainable development of asociety that is safe and comfortable to live in.
In order to ensure the high quality of our products andservices, the Company has established a “Basic Policy on
Quality Control” which is deployed at all production bases
as we strive to maintain and improve our human resources
education, compliance with rules, and our facilities.

Promotion framework
With regard to quality control, each fiscal year theCompany develops policies and the promotion framework
aimed at further maintaining and improving quality in eachbusiness unit, along with specific policies pertaining to the
reduction of flaws and other issues. The Company’s
Corporate Quality Control Division works together with thequality assurance department in each business unit to put
together a report on the status of quality control andresults in each unit. The report is delivered to top
management at the monthly Executive Officer Liaison
Meeting where measures are debated and decided.
Furthermore, in the event that a flaw is discovered after a
product has been shipped, the necessary steps are swiftly
taken, mainly by the quality assurance department in eachbusiness unit, while at the same time the causes that led
to the flaw and its mechanism are investigated, and thisinformation is put into a database so that the information
can be shared in-house in an effort to prevent recurrence.

Quality management system
The Company has created and operates a quality
management system at its production bases, theYokohama Plant and the Shiga Factory, and has obtained
ISO 9001 certification.
Year ISO 9001 certification obtained

Yokohama Plant

1994

Shiga Factory

2000

Extendedcompanywide

2007

Responding to the Global Market
Proper export controls
The Export Control Department at General Affairs Division
is responsible for export management as the export
management control department. We have created asystem for the proper management of exports in order toensure compliance with the laws and regulations
concerning export management in the countries andregions where we engage in business activities as well as
to avoid involvement in transactions that could hinder the
maintenance of international peace and safety.
The Export Control Department handles cargo andtechnology parameters used in determining whether or
not export permits are required, as well as investigation oftransactions. In addition, the Department carries out
employee education and guidance and support for Group
companies.

Towards Greater Customer Satisfaction
Customer satisfaction survey
Through its sales department, the Company regularly
conducts surveys on topics such as customer requests
and customer satisfaction. The results are reported to the
top management at Executive Officer Liaison Meetings,
and the information is shared within the Company. We
strive to maintain good relations with our customers byidentifying problems that need to be solved and swiftly
addressing them in order to raise customer satisfaction.
Toyo Denki Seizo Report 201420

Reports by Stakeholder

With Our SuppliersWith Our Shareholders and Investors

The Company responds to the needs of our customers through the strong network we have built with
suppliers in line with our unique characteristics as a business based on an individual build-to-order/multi-

Through the timely and proper disclosure of information and various modes of communication, we strive to
receive an appropriate evaluation of the Company from our shareholders and investors.

product small lot manufacturing model.

Towards Enhancement of Corporate Value

Towards Just and Fair Procurement

Basic philosophy
Communication with suppliers

Training for material procurement officers

The Company’s products possess various distinctive
characteristics such as being individually built-to-order,
manufactured in multi-product small lots, and demanding
high reliability. Therefore, the Company can be affected by
the performance of our suppliers as a result of issues suchas delays in supply due to fluctuations in production
quantity or delays in processing due to the quality of
products received.
In order to reduce these risks as much as possible, theCompany carries out instruction and support related toquality, technology, and skills for our suppliers, as well as
guidance for improvement of manufacturing sites, in orderto ensure stable procurement of even better quality
products. In addition, we actively promote information
sharing through the “Toyo Denki Cooperation Association”
to which our leading suppliers belong.

The Company endeavors to maintain proper execution ofoperations by implementing a variety of training programsfor material procurement officers to deepen theirknowledge of the Act against Delay in Payment of
Subcontract Proceeds, Etc. to Subcontractors and related
laws and regulations and to cultivate awareness of legal
compliance.

External whistle-blower system (for suppliers)
The Company has established an external whistle-blower
system to receive consultations or reports on compliancefrom our suppliers. The legal compliance department
handles complaints and consultations about transactions,and the Company’s retained lawyer resolves issues whennecessary.

T O P I C S

Establishment of “Procurement Action Guidelines”

In March 2014, the Company improved its procurement-related regulations and established the “Procurement Action
Guidelines.”

Procurement Action Guidelines
These guidelines indicate the codes of conduct that the Company’s executives and employees should
comply with in the procurement of purchased parts and outsourced parts as required for the
manufacturing of products ordered by customers (“procurement transactions”).
1. Procurement transactions shall be conducted in compliance with the laws of the relevant countries.
2. Information concerning suppliers in procurement transactions shall only be obtained within the scopenecessary for conducting procurement activities in accordance with contracts. Furthermore, efforts
shall be made to carefully manage and observe the confidentiality of information gained duringbusiness operations.
3. Personal interests with suppliers shall be prohibited in procurement transactions, including thelending and borrowing of money.
4. Receiving of remuneration or any other forms of personal rewards from suppliers shall be prohibitedin procurement transactions.
In addition, entertainment or gifts beyond the scope of normal social behavior shall be prohibited.
5. Forceful requests for entertainment, gifts, or donations from suppliers shall be prohibited in
procurement transactions.

21

Through timely and appropriate disclosure of information
to our shareholders and investors, the Company
accurately conveys our management policy and businessconditions while making use of IR tools such as our
website to promote a full range of IR activities that
contribute to the improvement of our corporate value.

Dividends
Maintenance of stable dividends forms the basis of theCompany’s distribution of profit, and the dividend for the
fiscal year ended May 31, 2014 was 6 yen per share(interim dividend of 0 yen, fiscal year-end dividend of 6yen). The Company also intends to maintain dividends at
6 yen or more per share from the fiscal year ending May
31, 2015 onward.

Development of IR activities
IR activities for institutional investors and securities
analysts
The Toyo Denki management team holds a financial results
briefing each quarterly period and gives a report including
the state of progress of the medium-term management
plan, an overview and forecast for each segment, major
orders, and other topics.
In addition, we strive to deepen understanding of theCompany through individual visits to institutional investors
or holding factory tours, participating in small meetingsorganized by securities companies, and so on.

IR activities for individual shareholders and individual
investors
The Company website includes a “For Individual Investors”
page which offers a clear introduction to our businessactivities and our results, as well as making available avariety of IR materials.

Dividend per share
(Yen)

8
6

6

6

6

6

6

2009

2010

2011

2012

2013

4
2
0
FY

Record of 153rd Ordinary General Meeting of Shareholders
Date held: Wednesday, August 27, 2014
Attendance: 97 people

URL “For Individual Investors”
http://www.toyodenki.co.jp/html/ir_individual.html
Holding of company presentations for individual investors- Friday, September 6, 2013
Mitsubishi UFJ Morgan Stanley Securities (Osaka Branch)
Attendance: 89 people- Tuesday, February 18, 2014
Mitsubishi UFJ Morgan Stanley Securities (Head Office)Attendance: 98 people
Holding of factory tour for shareholders
Friday, April 11, 2014 at the Yokohama Plant
Attendance: 31 people (120 applicants)

President Terashima greeting visitors at the factory tour for shareholders

Toyo Denki Seizo Report 201422

Reports by Stakeholder

With Our Employees
The Company seeks to cultivate a dynamic corporate culture and to create a pleasant and safe workplace
where each and every employee can unleash his or her diverse capabilities.

Towards the Development of Human Resources with Competitive Strengths
Human resources development policy
Executives
Division heads

The Company holds monthly meetings of the Safety andHygiene Committee jointly with labor and management,
where ongoing discussions are held in order to build asafer working environment and to reduce workplace
injuries to zero, and to find solutions to mental healthissues at each of our bases. In particular, sub-committees
are set up to address important topics related to safety
and hygiene at production bases in an effort to create aneven better workplace.

Acquisition of the “Kurumin” certification logo (June 2014)
Training for newly appointed division heads

Pre-promotion training for senior general staff

Follow-up training (3rd year)
Follow-up training (2nd year)
Follow-up training (1st year)
Training for new employees On-the-job
sales training
I Introductory training
II Hands-on learning
IT education
III Basic knowledge course
IV Practical training
Training inV Individual training business manners

Mental health training

Comprehensive training for newly appointed senior general staff

Life-planning seminar

Pre-promotion training for managers and professionals Coaching training

Compliance training

Evaluator training
Training for newly appointed managers and professionals

Various distance learning courses

Training for middle-management executives

TOEIC challenge system

Department heads

Safety and hygiene initiatives

Executive manager development training

Incentive system for acquiring certification

Training programs at the Company are divided into several
categories according to the employee’s year of service,type of work and role, and training is carried out after
clarifying what part each employee is expected to play.
Furthermore, in response to globalization of theCompany’s operations, we offer English and Chinese
language programs. The Company covers the full cost fora variety of courses tailored to the level of the participating
employees, including distance learning, enrollment inschools, and classes provided by teachers in-house.

Other/Personal development

Executive training

System for fostering specialists

Education and training system

Supervisors

Fundamental policy(1) To develop human resources who understand andpractice our business principles and code of conduct
and who are of value both as company employees andas members of society.
(2) To develop human resources who are professionals,
each possessing a high degree of specialized
expertise, by enhancing the knowledge, techniques,
and skills they need to carry out their duties.
(3) To provide a variety of educational opportunities inorder to promote personal development, with emphasis
on a self-directed approach to study and growth.

Non-managerial employees

The Company has set the following policy on humanresources development and carries out education andtraining.

Training system

Creating a Pleasant Workplace

Follow-up Training(within 1 year)
On-the-job
factory training(sales staff)
Introductory
IT education
training

Support system for Language education(TOEIC)acquiring public(Chinese)certification

Training for unofficial new hires (graduates)
Regular new hires (general staff group) Mid-career hires

In recognition of our efforts as a “company
that supports child-rearing,” which includes
a substantial childcare system, educational
activities concerning a work-life balance, the creation of anenvironment in which it is easy to obtain childcare leave,
and the acquisition record of childcare leave by male
employees, we received the “Kurumin” certification logo
from the Tokyo Labor Bureau in June 2014.

As for employees who wish to be rehired after theyreach the mandatory retirement age (60), in principle, we
continue to employ them until the age of 65.

Initiatives for employment of the disabled
The Company makes improvements to the workplaceenvironment and carries out workplace training with theaim of creating a workplace where the disabled and thosein normal health can work together energetically. We also
promote collaboration with local governing agencies andspecial-needs schools regarding employment of thedisabled.

Mental health measures
As measures to address mental health, the Company
conducts “Line care training” for administrative
professionals and “Self care training” for employees. In
addition, we have partnered with an external medical
institution to set up a telephone and e-mail consultation
service to provide support for prevention, treatment, andreturn to work.

Initiatives for diverse work-styles
The Company has implemented a flexible work-styleincluding a flextime system for sales staff and those
involved in development. Furthermore, in order toencourage retention and utilization of employees withknowledge and skills, we have put in place the “System
for Rehiring Employees” for employees who have resigned
due to life events that occur in the course of their career(childbirth, childcare, family care, spouse’s transfer, etc.),
so that they can be rehired when they reach the stage
when it is possible to return to work.
Work and family life
balance

Implementation of employee satisfaction survey
The Company conducts an “employee satisfaction survey”
once per year, and relevant departments work to resolve
various issues extracted from the survey results. In
addition, the company-wide “Dynamism Committee,”whose purpose is to create a “dynamic corporate culture,”leads various activities aimed at revitalizing internal
communication.

“Childcare leave is for men too!!” It was a very valuable period for me.
Daisuke Yokomizo (Human Resources Division)

Passing on skills

Training for new employees

23

In order to proactively promote the transmission ofoutstanding skills to maintain high quality, the Company
encourages employees to obtain official certifications.
Furthermore, employees with exceptional manufacturing
skills or expertise are recognized as “My Star” internallyand given responsibility to instruct and train younger
workers.
In April 2013, the Technical Training Center was newly
established within the Yokohama Plant, where training iscarried out for technical staff through lectures and various
hands-on workshops.

When I learned of my wife’s pregnancy, I decided to takechildcare leave in consideration of my wife’s recovery after
giving birth.
I took leave for approximately three and a half months,
and during this time I did all that I could to support my wife
24 hours a day, day and night with tasks such as preparing
milk, changing diapers, daily shopping, and giving medicine
to my child when she felt unwell. I also actively participatedin events that were mainly for mothers and babies (such as
baby massage classes), and I was able to share withpeople about concerns such as how to communicate withmy child and concerns related to childcare.
During this leave, I was able to realize how hard it mustbe for my wife to take care of our child everyday, as well as

the fact that while childcare is difficult,it is also a lot of fun. Although it was a
short period of time, I feel that thisvaluable experience has added to mylife. The fact that my one-year olddaughter is very fond of me provesthat the leave has really paid off, andthis makes me extremely happy.
I am very grateful to my superiors and coworkers whoenabled me to have this valuable opportunity. Thanks tothis I was the first male employee at the Company to apply
for childcare leave, and I hope that my experience willencourage other male employees to apply for childcare
leave as well.

Toyo Denki Seizo Report 201424

Reports by Stakeholder

Initiatives to Deal with the Environment and Local Communities

Data Concerning Personnel and Labor

Initiatives to Protect the Environment

Data concerning personnel and labor (at Toyo Denki Seizo K.K.)
Item

Unit

Fiscal 2009

Total
Number of employees

Men

700

Men

2

791

3

797

51

51

51

56

60

6.8

6.9

7.1

7.5

170

171

155

152

156

169

170

153

151

155

1

1

2

1

1

0.6

0.6

1.3

0.7

0.6

39.7

40.8

41.1

41.0

41.1
41.2

Persons

Overall
Men

744

7.3

%

Average age

2

Fiscal 2013

%

Women
Ration of female administrative professionals

748

Fiscal 2012

649

Total
Number of administrative professionals

1

Fiscal 2011

Persons

Women
Ratio of female employees

Fiscal 2010

693

735

40.0

41.1

41.4

41.1

35.7

36.5

38.2

38.9

39.0

Overall

16.2

16.4

16.5

16.1

16.3

Years

16.4

16.6

16.7

16.3

16.5

13.3

13.5

14.6

14.5

14.5

Average annual salaryYen

5,831,972

5,953,210

6,039,332

5,885,559

5,750,453

Overturn rate (within 3 years of joining the Company)

%

5.9

5.9

13.5

3.8

0.0
1

Men
Women

3

737

Women
Average years of employment

Age

697

Number taking childcare leave

Persons

0

1

2

3

Number taking family care leave

Persons

0

0

0

0

0

Number of temporary staff (including part-timers)

Persons

222

155

149

167

158

*1 Number of regular employees excluding Executive Officers*2 Number of regular employees including Executive Officers and number of special employees, temporary
employees and temporary and part-time employees*3 Number of regular employees including Executive Officers, and number of special employees, temporary
employees, contract employees and staff on loan from other companies, etc.

Notes

With a view to realizing an environment-friendly society, the Company will further strive to provide more
efficient and energy-saving products that generate lower noise, while promoting the reduction ofenvironmental burden.

Environmental Philosophy
The Toyo Denki Group sets initiatives to protect the global environment as its priority task and contributes to thedevelopment of a sustainable society.

Action Guidelines

We will continue to provide products and services that are considerate of the burden on the global environment by drawing
on our “future-oriented technologies friendly to the Earth and mankind.”
1.
2.
3.
4.

We will comply with all environmental requirements including those under the relevant laws and regulations.
We will strive to minimize environmental burden through a reduction of energy consumption and other measuresat all stages of product lifecycle, namely planning, development, design, production, sales, use and disposal.
We will establish and execute a system to continuously promote activities to protect the global environment.
We will raise environmental awareness among individuals through enlightenment activities within the Group

Aiming for Realization of a Sustainable Society

Reference data I: Number of Officers (at Toyo Denki Seizo K.K.)
Item

Unit
Total

Number of Officers

Men

Persons

Women

Fiscal 2009

Fiscal 2010

Fiscal 2011

Fiscal 2012

Fiscal 2013

10

12

10

10

11

10

12

10

10

11

0

0

0

0

0

For each fiscal year as of May 31 (Executives include Directors, Internal Statutory Auditors, and External
Statutory Auditors)

Notes

Reference data II: Number of employees at the Group Companies in Japan and overseas (at the 6 consolidated subsidiaries of Toyo Denki Seizo K.K.)
Item

Fiscal 2009

Fiscal 2010

Fiscal 2011

Fiscal 2012

Fiscal 2013

Number of employees at Group companies in Japan and overseas Persons

Unit

373

429

431

379

404

Number of temporary staff (including part-timers)

353

262

235

256

243

Notes

Persons

As of May 31 for each fiscal year

Reference data III: System for support of work-family balance (at Toyo Denki Seizo K.K.)
Prenatal leave
Maternity leave
Childcare leave
Maternity andchildcare related

Repeat childcare leave(Mom and Dad Childcare
Leave Plus)
Shorter working hours forchildcare
Nursing leave
Family care leave

Family care related

Other

25

Family care work hours
System for Rehiring
Employees

Can be taken from 8 weeks prior to due date (14 weeks prior in the case of multiple births).
(6 weeks is required by law)Can be taken for up to 8 weeks after birth.
In principle, childcare leave can be taken for a period as needed from the day after 8 weeks have elapsed
since birth (completion of maternity leave), until the day before the child turns 1 year old. In cases where
it is difficult to find a place in daycare, etc., it is possible to apply for an extension of childcare leave until
the child is 1 year and 6 months, or until the last day of the month of March after the child has reached
the age of 1 year, whichever is longer.
If an employee has taken childcare leave within the 8-week period after his spouse has given birth, he
may take repeat childcare leave until the child reaches one year of age. Further, if the employee andspouse both take childcare leave, the childcare leave period can be extended until the child reaches 1
year and 2 months.
Working hours may be set at 5 hours 45 minutes or 6 hours 45 minutes per day for a period as neededfrom the end of childcare leave until the child graduates from elementary school.
Up to 5 special days off may be taken per family member for nursing care for pre-elementary school age
children.
A total of up to 3 years of family care leave may be taken per person needing care.
Employees not taking family care leave may limit working hours to 5 hours and 45 minutes or 6 hours
and 45 minutes per day.
Employees who have resigned due to marriage, infertility treatment, childbirth, childcare, family care, or
spouse’s transfer, etc., may be rehired when they are able to return to work depending on the employee’s
request and workplace needs.

A sustainable society as envisaged by the Company is the
combination of a “low-carbon society,” a “recycling-basedsociety” and a “nature-symbiotic society.”
The Company has produced numerous products thatfacilitate the efficient use of energy, including highefficiency motors and inverters that capitalize on theamalgamation of our outstanding motor drive technology
and other state-of-the-art technologies. In the meantime,
the Company has been striving to reduce the size andweight of its products as part of its efforts to conserve
resources, while lowering the level of noise involved in theiru s e t o m a k e t h e m f r i e n d l i e r t o t h e s u r ro u n d i n genvironment. As a member of society, the Company will
make further contribution to make society moresustainable, fully utilizing on its environmental technologies
on a global scale, while following through various
environmental actions at each of its bases.

Environment technologies of theCompany
Energy conservation at each baseUse of sustainable energy

Low-carbon society
Implementation of measures against
global warming

Recycling-based society

Waste reduction and recyclingat each basePromotion of waste reduction
and recycling

Nature-symbiotic society

Initiatives for control overchemical substances

Conservation of biodiversity

Environmental Management System
In order to tackle environmental issues on an independentand continuous basis, the Company has developed andoperates an environmental management system andthereby obtained ISO 14001 certification. This certification
has been acquired for all offices and the production bases
Yokohama Plant and Shiga Factory.

Years of ISO 14001 certification

Shiga Factory

2001

Yokohama Plant

2004

Extended to all
offices

2010

Toyo Denki Seizo Report 201426

Initiatives to Deal with the Environment and Local Communities
Environmental Data
Indices
Electric power (10,000 kWh)

Initiatives to Prevent Global Warming

Urban gas (1,000 Nm3)

Initiatives to reduce greenhouse gas (CO2) emissions

Targeted reduction of CO2 emissions and progress status

The Company is promoting energy conservation at eachof its production bases and offices to reduce its CO2
emissions.
At the production bases in particular, the progress ofenergy-saving efforts at workplaces is checked on amonthly basis to encourage an energy-saving awarenessamong employees, along with general power-saving andstreamlining at production facilities.

Aiming to reduce CO2 emissions per unit of production
output by 1% year on year, the Company’s main
production base, the Yokohama Plant, achieved a 1.3%
reduction in fiscal 2013 with growth in production output
despite an increase in power and gas consumption.

600

3

720.7
317.2

637.0

244.6

232.0

400

400

631.8

590.9
252.0

628.5
284.0

0

3,479.2

200

2,000

2011

2012

2013

20

Water input

22.5
17.9

15

21.1
15.8

0
2009

(year*)

Water output

19.9
15.8

Fiscal 2011
667.1
631.8
35.3
28.9
244.6
244.6
21.1
21.1
0.0
3,014.0
2,905.0
109.0
231.0
15,388.5
15,388.5
15.8
15.8
0.0

Fiscal 2012
624.1
590.9
33.2
31.2
252.0
252.0
19.9
19.9
0.0
3,456.3
3,307.3
149.0
169.0
450,138.2
433,862.6
16,275.6
13.9
13.9
0.0

Fiscal 2013
664.8
628.5
36.3
27.9
284.0
284.0
14.2
14.2
0.0
4,122.0
3,936.0
186.0
168.0
691,187.0
674,891.0
16,296.0
12.3
12.3
0.0

Remarks

1

2

3

4
5

6

3,307.3

2010

2011

2012

2013

(year*)

Total solar power generation at Yokohama Plant(Unit: 1,000 m3)

22.8

2,905.0

2,896.7

1,000

0
2010

Based on 500 kW generator
Yokohama Plant
Based on 12 kW generator
Production bases total
Yokohama Plant
Shiga Factory

Fiscal 2010
756.9
720.7
36.2
35.5
317.2
317.2
22.5
22.5
0.0
3,585.2
3,479.2
106.0
212.0
16,219.7
16,219.7
15.8
15.8
0.0

Initiatives for Control over Chemical Substances

3,936.0

4,000
3,000

Total water input/output at Yokohama Plant
25

(t)

300

100

200

2009

Solar power generation (kWh)Fiscal 2009
662.1
637.0
25.1
24.8
232.0
232.0
22.8
22.8
0.0
2,985.7
2,896.789.0
3,217.1
3,217.1
17.9
17.9
0.0

Total CO2 emissions at Yokohama Plant

Gas (Unit: 1,000 Nm )Electricity

800

CO2 emissions (t)Water output (1,000 m3)

Total energy input at Yokohama Plant (electricity and gas)
(Unit: 10,000 kWh)

Water input (1,000 m3)

Applicable premises
Production bases total
Yokohama Plant
Shiga FactoryNon-production bases total
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga FactoryNon-production bases total
Power generation total

Based on 12 kW generator(kWh)

750,000

Based on 500 kW generator

Volatile organic compounds (VOCs) emitted as a result ofour business activities are adequately controlled and theamount of emission in monitored under the Pollutant
Release and Transfer Register (PRTR).
PCB waste is also subject to adequate control, storage
and disposal in accordance with Japan’s Act on Special
Measures concerning Promotion of Proper Treatment of
PCB Wastes.
We will further engage in the reduction of waste
through such measures including using non-VOC materials
and implementing recovery and reuse of solvents.

Notification volume for Pollutant Release and Transfer Register (PRTR) substances(kg)

Total amount of air emissions

10,0008,000
6,000

Total amount of shift

9,600
7,900
6,060

7,700
5,320

4,000

4,600

7,300
4,810

8,300
5,290

2,000
0
2009

674,891.0

2010

2011

2012

2013

(year*)

600,000

13.9

10

14.2

433,862.6

450,000

12.3

20,00016,219.7

15,388.5

16,275.6

16,296.0

2010

2011

2012

2013

Initiatives for Reducing Disposed Waste as Well as Recycling

10,0005

Main actions

0

0
2009

2010

2011

2012

2013

(year*)(year*)The Company successfully reduced its landfill waste rate
to 0.9% in fiscal 2013, as a result of thoroughly
implementing waste processing rules, sorting of metal
waste and recycling of paper resources.

Output of general and valuable waste
(t)

800

710.0

703.5

2009

2010

600

652.2

637.4

587.9

2011

2012

2013

5.6

5.0

5.9

2011

2012

2013

400
200
0

Promotion of green procurement
The Company is promoting green procurement withrespect to office equipment and supplies, stationery andworker’s clothes used at the Yokohama Plant. A 75%
green procurement ratio was achieved in fiscal 2013
based on purchase value.

(year*)

Volume of landfill waste
(t)

25

24.2

20
15
10

12.4

5
0
2009

27

2010

(year*)

Toyo Denki Seizo Report 201428

Initiatives to Deal with the Environment and Local Communities

PRTR Data
Indices
Total amount of air emissions (kg)
Total amount of shift (kg)

PRTR 7

Applicable premises

Production bases total
Total amount of
Yokohama Plant
air emissions
Shiga Factory
Bisphenol A (kg)
Production bases total
Total amount
Yokohama Plantof shift
Shiga Factory
Production bases total
Total amount of
Yokohama Plant
air emissions
Shiga Factory
Ethylbenzene (kg)
Production bases total
Total amount
Yokohama Plantof shift
Shiga Factory
Production bases total
Total amount of
Yokohama Plant
air emissions
Shiga Factory
Xylene (kg)
Production bases total
Total amount
Yokohama Plantof shift
Shiga Factory
Production bases total
Total amount of
Yokohama Plant
air emissions
Shiga Factory
Tetrahydromethylphthalicanhydride (kg)
Production bases total
Total amount
Yokohama Plantof shift
Shiga Factory
Production bases total
Total amount of
Yokohama Plant
air emissions
Shiga Factory
Toluene (kg)
Production bases total
Total amount
Yokohama Plantof shift
Shiga Factory

Fiscal 2009
7,900
6,060
0
0
0
940
940
0
1,700
1,700
0
230
230
0
2,900
2,900
0
190
190
0
0
0
0
3,700
3,700
0
3,300
3,300
0
1,000
1,000
0

Fiscal 2010
9,600
5,320
0
0
2,300
2,300
0
450
450
0
4,000
4,000
0
370
370
0
0
0
0
2,800
2,800
0
3,300
3,300
0
1,700
1,700
0

Fiscal 2011
7,700
4,600
0
0
1,800
1,800
0
550
550
0
3,300
3,300
0
450
450
0
0
0
0
1,600
1,600
0
2,600
2,600
0
2,000
2,000
0

Fiscal 2012
7,300
4,810
0
0
1,800
1,800
0
330
330
0
2,900
2,900
0
280
280
0
0
0
0
3,000
3,000
0
2,600
2,600
0
1,200
1,200
0

Fiscal 2013
8,300
5,290
0
0
2,000
2,000
0
430
430
0
3,300
3,300
0
360
360
0
0
0
0
2,900
2,900
0
3,000
3,000
0
1,600
1,600
0

Remarks

Fiscal 2009
242.5
242.5
113.1
113.1
354.4
354.4
710.0
710.0
556.5
556.5
12.4
12.4
1.7
1.7
-

Fiscal 2010
319.8
292.8
27.0
130.2
130.2
280.5
280.5
730.5
703.5
27.0
524.3
524.3

Fiscal 2011
316.7
282.4
34.3
114.9
114.9
240.1
240.1
671.7
637.4
34.3
436.4
436.4

Fiscal 2012
279.9
244.1
35.8
101.9
101.9
255.6
255.6
637.3
601.5
35.8
435.2
435.2

Fiscal 2013
290.3
262.0
28.3
99.3
99.3
290.9
290.9
680.5
652.2
28.3
462.4
462.4

Remarks

10

10

10

10

24.2
24.2

5.6
5.6

5.0
5.0

5.9
5.9

8

Industrial waste (tons)
General waste (tons)
Valuable metal waste (tons)
WastesWaste output ( + + ) (tons)
Recycled amount (tons)
Volume of landfill waste (tons)
Percentage of landfill waste (%)
Yearly comparison

Applicable premises
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory
Production bases total
Yokohama Plant
Shiga Factory

10

10

10

10

3.3
3.4

0.8
0.9

0.8
0.8

0.9
0.9

10

10

10

10

We are committed to various social contribution activities, to facilitate our own co-existence with
communities and to foster young people who will represent the next generation.

To Convey the Mission and the Appeal of Electrical Industry as Well as of Toyo Denki
As an electrical manufacturer that contributes to thedevelopment of social infrastructures, the Company
performs various activities to promote understanding of
our missions and business contents among many people.

Receiving interns
We are committed to activities that raise awareness andappreciation of our manufacturing expertise by acceptinginterns from local technical high schools and providingthem with hands-on experience at manufacturing sites.
This internship system serves as an effective means ofrecruiting outstanding technical staff on a consistent basis
as some students in the schools apply for positions at theCompany.

Waste Data
Indices

Contributions to Local Communities

9

9

9

9

9

On-demand lectures on career workshops
The Company also
dispatches its
employees, primarily
engineers, for a career
workshop at educational
institutions. The
employees provide useful
information to promoteautonomous career
A career workshop at a highchoice among theschoolstudents at junior highschools and highschools. We offer audience-friendly presentations thatprovide practical information on the design anddevelopment work at manufacturers and give advice tostudents who are interested in becoming engineers.

Factory tours
We are conducting“factory tours” to provide
opportunities formembers of local
communities to actually
see our manufacturing
facilities and products inorder to develop deeper
understanding about the
A factory tour
business operations of
the Company. During
these tours, we inform the participants of our products aswell as our actions for environmental protection, in aneffort to build up relationships built on trust with local
communities.

Cooperation with Yokohama Kyodo no Mori Fund
The Company cooperates in small woodlands
conservation activities led mainly by the city of Yokohama
by donating part of the proceeds from vending machines
installed at the Engineering Center of the Yokohama Plant
to the fund.

Cleanup campaigns within the vicinity of the production bases
In cooperation with neighboring companies, we conductcleanup campaigns within the vicinity of the Yokohama
Plant and the Shiga Factory.

*The fiscal year is from April to March of the following year.
*Non-production bases: Toyo Denki Seizo Head Office, Osaka Branch, Nagoya Branch, Hokkaido Branch, Kyushu Branch, Hiroshima Branch*1 ISO 14001 certification was obtained for non-production bases inJune 2010.
*2 Production activities at Shiga Factory recorded close to zero water
input.
*3 Data collection started in fiscal 2010.
*4 500 kW solar panel became operational in July 2012.
*5 12 kW solar panel became operational in January 2010.

29*6 Production activities at Shiga Factory recorded close to zero water output.
*7 PPTR: Pollutant Release and Transfer Register*8 Bisphenol A has been inapplicable thus outside the scope of registration since fiscal
2010.
*9 Data collection started at Shiga Factory in fiscal 2010, prior to which no data existed.
*10 The recycled amount and the volume of landfill waste at the Shiga Factory are scheduled
for investigation starting in fiscal 2014.

Cleanup campaign(Yokohama Plant)

Cleanup campaign(Shiga Factory)

Toyo Denki Seizo Report 201430