CSR Report 2022
Corporate Social Responsibility Report 2022

About Nihon Nohyaku
Philosophy Structure of the Nihon Nohyaku Group

Creating New Agrochemicals and Crop Aid Products
to Improve the Quality of Life for All
Philosophy Structure

Basic Principles

Philosophy

CSR Basic Policy(Group’s raison d’etre, purpose, and value)

Contributing to food and the environment /society through technological innovation
Based on the Nihon Nohyaku Group Basic Principles,
we will contribute to society through continuous
challenges to ensure sufficient food supply by
Action Charterinnovative technologies and to protect affluent(Action Charter based on the Basic Principles)
lifestyles and the environment.

VisionBusiness Plan

(Growing Global)

Medium-Term Management Plan
CSR
activities

Management Policy and Business Plan (Annual)(measures to realize the Basic Principles)

CSR Report 2022 Contents

01 About Nihon Nohyaku

Philosophy Structure of
the Nihon Nohyaku Group
Commitment of Top Management
At a glance
Financial/Non-financial Highlights
Special feature

11 CSR of Nihon Nohyaku

Approach to CSR in the Nihon Nohyaku
Group

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CSR REPORT 2022

15 Raising the Level ofEnvironmental Management
Response to Climate Change
Environmental Preservation

17 Expansion of Human Rights
Management

Initiatives for Human Rights
Human Resources Management
Diversity & Inclusion
Comfortable Work Environment

19 Enhancing the Safety Culture 24 Community Involvement
Occupational Safety & Health,
Process Safety & Disaster Prevention
Product Stewardship(Chemical Materials & Product Safety)
Supply Chain Management
Logistics Safety
Quality Management

21 To Develop Technologies andProduct that Meet Needs of Society
Product Development
Initiatives toward Advanced Technologies

Dialogue with Stakeholders
Support for Regional Revitalization

25 Strengthening Corporate andOrganizational GovernanceCorporate Governance

27 Expansion of Compliance andRisk Management

Compliance
Risk Management
Response to TCFD Recommendations

The Nihon Nohyaku Group has established the “CSR Basic Policy” and organized
and restructured the philosophy structure by positioning it as the background(backbone) of the existing Basic Principles, Action Charter, and Group Vision. In
March 2022, the Group applied for and was approved to sign the United Nations
Global Compact, as it is in line with the philosophy and corporate stance that the
Nihon Nohyaku Group has upheld since its founding, as a fundamental way topromote our growth strategy for becoming a global company.

About CSR (Corporate Social Responsibility)
CSR is the general term for activities focused on achieving
sustainable development for the company and society
based on the philosophy that the responsibility of acorporation is not simply to adhere to the law and pursue
profits for the company, but also to fulfill responsibilities tosociety based on an ethical code. Based on the Basic
Principles, the Nihon Nohyaku Group is pushing forward
the establishment of a CSR promotion system.

The Basic Principles of the Nihon Nohyaku Group●	We contribute to society by ensuring a safe and steady food supply and improving the quality of life for all.
●	We fulfill market needs by creating superior values with innovative technologies.
●	We commit to be a trustworthy company for all stakeholders through our fair and vigorous business activities.

The Nihon Nohyaku Group Action Charter
1. We improve the quality of life for all by providing safe and effective products and services that satisfy our customers.
2.	We conduct fair and transparent business operations, respecting social ethics and complying with related laws,
regulations and the spirit thereof.
3. We contribute to the realization of a sustainable society, considering the global environment.
4. We actively communicate and contribute to our communities as a good corporate citizen.
5. We properly manage corporate information and disclose it in a timely and appropriate manner.
6.	We recognize the importance of personal data, intellectual property and other information, and safeguard it under proper
protection and management.
7.	We ensure a safe and comfortable work environment for our employees, always respecting human rights and thediversity in people and cultures.
8. We entirely exclude involvement with antisocial forces and organizations, and resolutely refuse unreasonable requests.
9.	We contribute to the development of each country and region in line with globalization, adhering to international rules
as well as local laws, culture and customs.
10. We promote the sound and sustainable growth of Nichino Group for social contribution.

United Nations Global Compact
As the world’s largest CSR initiative, it is a guideline for corporate
activities based on ten principles in the four areas of human rights,
labor, environment, and anti-corruption. Global Compact Network
Japan is developing promotional activities, including subcommittee
activities and international exchanges, across Japan.

Editorial Policy

29 Company Overview and Listof The Nihon Nohyaku Group
Companies
30 Third-Party Opinion and
Third-Party Verification
For main ESG data,
please refer tothe “CSR Report 2022
Data Sheet” on
our website.

This CSR Report summarizes The Nihon Nohyaku Group activities using the following as references:Environmental Reporting Guidelines (2018) by the GRI Standards and the Japanese Ministry of the Environment,
Environmental Accounting Guidelines (2003) by the Japan Chemical Industry Association (JCIA),and JIS Z 26000: 2012 Guidance on Social Responsibility by the Japanese Standards Association, etc.

Scope of
Applicability

Unless otherwise noted, performance data is from Nihon Nohyaku Co., Ltd. and Nichino
Service Co., Ltd. Unless otherwise noted, the scope of applicability of the Nihon Nohyaku
Group covers Nihon Nohyaku Co., Ltd. and nine consolidated Group companies.

Data
Aggregation
PeriodUnless otherwise noted, the 2021 fiscal year (the 123rd fiscal year, April 2021 to March
2022, denoted in this text simply as “fiscal year”). Capital, numbers of employees, net
sales, etc., displayed in this text are as of end of March 2022.

Issue

September 2022 (Next: Planned for September 2023)* Pursuant to the Partial Amendment to the Articles of Incorporation approved at the 120th Ordinary General Meeting of Shareholders held on
December 20, 2019, Nihon Nohyaku has changed its fiscal year end from September 30 to March 31, effective from the 121st fiscal year.
CSR REPORT 20222

About Nihon Nohyaku

Commitment of Top Management

We contribute to realize asustainable society as an R&D
based agrochemical
manufacturer
Nihon Nohyaku has supported the evolution ofagriculture for over 90 years. Today, our businesses
have expanded around the globe, including chemicals
and pharmaceuticals. The demands placed on us
change with each new era, but our commitment
remains the same: to ensure a safe and steady foodsupply and improve the quality of life for all.
We will continuously contribute to society, taking pridein our mission as an agrochemical manufacturer.

andHiroyuki Iwata President
Representative Director

Connecting to the future always minding our mission as a company
My name is Hiroyuki Iwata, and I have recently
assumed the position of President and Representative
Director. I am humbled to receive this appointment andtake charge of management. I will do my best to
maximize our corporate value.
Nihon Nohyaku was founded in 1928 as Japan’s first
agrochemical manufacturer. For over 90 years sincethen, we have contributed to the pest infestations andweed control with a sense of responsibility and pride
related to the stable production of food that is essential
for people to live.
Today, we continue to promote agrochemicals andraise awareness of their safe and appropriate use. We
are working on R&D with the aim of creating at least
one agrochemical every three years with excellent
performance, effectiveness, cost, and safety in all over
the world. Moreover, in recent years, we have quickly
responded to the needs of the times, such as withinitiatives toward “smart agriculture” that make use of
cutting-edge technologies, and we globally expand ourbusiness in order to contribute to the development ofagriculture not only in Japan, but around the world.
Myself have been involved in domestic sales for along time, and as a sales representative, I have directly
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CSR REPORT 2022

listened to the opinions of various growers across thecountry. Later, in 2016, I was put in charge of overseas
sales when Nihon Nohyaku was accelerating its global
expansion. I have personally experienced the process
of expanding the scope of the Nihon Nohyaku Group’s
activities from Japan to the rest of the world.
However, upon reviewing the current situation
surrounding agriculture, we can see that there are many
issues to be solved. Domestically, food security has
become a major issue. Japan’s food self-sufficiency
rate on a calorie basis is only 38%, and it is important toraise this rate.
Globally, the impact of climate change on agriculture
is becoming increasingly serious. As various risks
increase, such as the progression of desertification, alack of water resources, changes in suitable cultivation
areas, an increase in pest infestations and weeds, andfrequent occurrences of extreme weather, there areconcerns about decreases in farmland area and crop
yield. On the other hand, the world’s population
continues to grow and is estimated to reach 9.7 billion
by 2050, raising concerns about serious food shortages.
As it becomes essential to increase food production
through improved agricultural productivity, agrochemicals

are playing an increasingly important role as an effectivemeans of controlling pest infestations and weeds.
Our primary mission is to ensure a safe and steadyfood supply and improve the quality of life for all. Our
stance of contributing to society through our businessby solving various issues in agriculture has remained

unchanged since our founding, and is currently
integrated in the form of the “Basic Principles of the
Nihon Nohyaku Group.” Our Group will continue totackle technological innovation and contribute to thecreation of a better future by providing safe and ecoharmonized agrochemicals.

Rebuilding our philosophy and organizational structure with CSR as
the foundation of management
As the movement to solve social issues globally
accelerates, including environmental and human rights
issues, the Nihon Nohyaku Group is also working tostrengthen CSR management in order to steadily
contribute to society through our business.
We have formulated a CSR Basic Policy of“Contributing to Food, Environment and Society throughTechnological Innovation” and positioned it as the
background (backbone) of our previous Basic
Principles, Action Charter, and Group Vision.
Furthermore, based on this CSR Basic Policy, we haveestablished a Basic Human Rights Policy and a Basic
Procurement Policy, for developing our businessactivities as a global common guideline.

In terms of organizational structure, in 2020, we
newly established the CSR Committee, a decisionmaking body on the same level as the Management
Committee. We also established the CSR Working
Group and Human Rights and Labor Practices
Subcommittee as the actual working units. In August
2021, CSR Promotion Department was established as
an organization in charge of CSR activities. The word
CSR covers a wide range of content, and CSR
Promotion Department collaborates with eachdepartment to control company-wide CSR activities,
supporting on-site implementation, and shares theresults both inside and outside the company.

Ensuring Growing Global 2
Group KPI
Operating profit Net sales¥6.4 Bil ¥89.0 Bil
Dividend payout ratio
30% or above

Execute further
growth strategy

Target sales¥100.0 Bil
Reinforcement ofbusiness infrastructure

Global expansion up until now■ Improve profitability■ Technological innovation andestablishment of next-generation businesses■ Sustainable growth in corporate value

Quantitative progress management for seven priority issues
In the new medium-term management plan “Ensuring
Growing Global 2 (EGG2)”, which started in April 2021,
we aim to strengthen CSR management by setting“sustainable growth in corporate value” as one of its
pillars. To that end, we have formulated seven CSR

priority issues that address ESG. We are working
backwards from our vision for 2030 and setting
quantitative targets and specific action plans, which willlead to steady implementation.
The progress made in the past year is as follows.

CSR REPORT 2022

4

About Nihon Nohyaku
Commitment of Top Management

Progress of Seven CSR Priority Issues in FY2021

E Environment●

1 Raising the level of environmental management

The Nihon Nohyaku Group has established a greenhouse gas (GHG) reduction policy and announced that it will aim to be carbon
neutral by 2050*.
* Nihon Nohyaku and affiliated companies in Japan and overseas that have manufacturing sites. If India is included, we aim to be carbon neutral by 2070.

S Society● Expansion of human rights management
2

Nihon Nohyaku signed the United Nations Global Compact in March 2022. With regard to the promotion of female participation in theworkplace, we have set specific numerical targets for the percentage of women in the final interview for new graduate recruitment
and the percentage of women in management positions, and we are working to achieve them.

● Enhancing the safety culture3

We are continuing our initiatives that aim for zero accidents. In addition, based on the Nihon Nohyaku Group Basic Human Rights Policy
and Basic Procurement Policy formulated in 2021, we conducted a CSR procurement questionnaire survey targeting our business partners.

● Development of technologies and products that meet needs of society
4

While promoting the development of Eco-harmonized products, we are also promoting business development for new Crop Aid
Products. In 2021, we began full-scale sales of “Frost Buster,” a new agricultural material that uses natural extract derived fromcoffee grounds to reduce the risk of frost damage on crops. We also promoted collaboration with various agricultural platforms suchas by enhancing AI image diagnosis technologies.

●

5 Community involvement
In line with GRI Standards*, we have expanded our website and worked to ensure appropriate disclosure of information. Goingforward, we will further deepen dialogue with stakeholders by contributing to local communities through our business activities.
* International standards for disclosure of information on sustainability

G●

Governance

6 Strengthening corporate and organizational governance
Aiming for more transparent corporate management, we have enhanced internal audits, including those at overseas Group
companies. We also worked to improve the effectiveness of the Board of Directors through the revitalization of the GovernanceCommittee and the introduction of external evaluations.

For all

ESG● Expansion of compliance and risk management
7

We expanded compliance activities to domestic and overseas Group companies. In February 2022, we announced our support for
the Task Force on Climate-related Financial Disclosures (TCFD). We have identified major risks and opportunities regarding theimpact of climate change on our business and announced each countermeasure. In light of the increase in natural disasters, wehave started verifying the BCP (Business Continuity Plan).

Our business activities themselves correspond to the practice of CSR
As an R&D based agrochemical manufacturer, theNihon Nohyaku Group has always taken on the issuesof the times and contributed to the stable production offood. We are proud to say that our business itself
corresponds to the practice CSR and SDGs. With that
determination, we have adopted a new corporate
statement, “Global Innovator for Crop & Life,” since lastyear. We aim to be a company that can widely
contribute to the life science field, including
pharmaceuticals and animal health products, with
agrochemical business as our core business.

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CSR REPORT 2022

As business expands globally, the social issues
confronted us have become increasingly complex andintricate. However, we own advanced knowledge andtechnical capabilities that we have cultivated since ourfounding. We believe that if we bring together thestrengths of each and every employee, we will get
closer to realizing a sustainable society.
As the person who has taken over management
during this difficult time, I promise that the entire
company will move forward together as a team. We
would appreciate it if all of our stakeholders would
watch over us as we take on this challenge.

About Nihon Nohyaku

At a glance
About the Nihon Nohyaku Group
Nihon Nohyaku was founded in
1928 as the first Japanese
agrochemical manufacturer. Since
our founding, Nihon Nohyaku has
been working on technologicalinnovation in its core businessinvolving research anddevelopment, and promotion of
agrochemicals, with the mission of
ensuring a safe and steady foodsupply and improving the qualityof life for all. As a global innovatorfor crop & life, we will continue totake on the challenge of creating
new value by providing advanced
technologies and contribute to asustainable society through ourbusiness activities.

The Nihon Nohyaku Group Vision

Nichino Group - Growing Global Contribution● Supporting agricultural production and healthy lifestyles by
providing advanced technologies that meet customer needs,
such as new agrochemicals, pharmaceuticals, and animal
health products● Contributing to a sustainable society by expanding
products and services that contribute to the SDGs
(Eco-harmonized products and labor-saving
technologies)

Social contribution

Creation

Earnings

Earnings improvement

Corporate Statement

Global Expansion of Nihon Nohyaku

Global Meeting of Japan, the USA,
Europe, and Brazil

13

4

overseas Group
companies*

domestic Group
companies* Total of subsidiaries andaffiliated companies

Nihon Nohyaku Co., Ltd.
Head Office address

19-8 Kyobashi 1-Chome, Chuo-ku, Tokyo 104-8386

FoundedNovember 17, 1928

Capital14,939 million yen

Number of employees(consolidated)

1,536

Main business

Manufacture, import, export, and sale of a variety of
products including agrochemicals, pharmaceuticals,
animal health products, industrial chemicals, woodpreservatives, and agricultural material
CSR REPORT 2022

6

About Nihon Nohyaku

Financial/Non-financial Highlights■Summary of Performance Results for FY2021 (Consolidated)■Status by business division
Domestic
agrochemical sales

Sales

81.9 billion yen

Operating profit

6.6 billion yen

Ordinary profit

5.7 billion yen

24.2%

Profit attributable to owners of parent

4.5 billion yen

Other

ROE

7.1 %

Liabilities

51.2

Net assets

66.9 billion yen

Total assets

118.2 billion yen

Equity ratio

55.5 %

billion yen

Overseas
agrochemical sales

67.2%■ Asia 29.0%■ Americas 49.3%■ Europe 19.6%■ Other regions 2.1%

Sales composition
by business division

2.0%

Greening andgardening construction,
real estate leasing,agrochemical residue Other
analysis etc.
agrochemicals

1.6 billion yen

Other chemical products excluding agrochemicals

2.4% 4.2%■Mainstay products
Domestic
agrochemical sales

Overseas
agrochemical sales

Other chemical products
excluding agrochemicals

Sales

Sales

Sales

19.8

55.0

billionyen

3.4

billionyenbillionyen

Sales

Operating profit

Ordinary profit(billion yen)(billion yen)(billion yen)

6.9

81.9

6.6

71.5
61.2

5.7
4.1

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022■■Proﬁt attributable to owners of parent (billion yen)

Profitto owners of parent/●●ROEattributable(%)
ROE■■Profit attributable to owners of parent (billion yen)●●ROE (%)
4.5
4.3

2.6
1.4

4.9

4.8

7.4

CSR REPORT 2022

4.0

3.6
2.9

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Net assets/Total assets/Equity ratio

Earnings per share/Net assets per share■■Net assets (billion yen)■■Total assets (billion yen)●●Equity ratio (%)
98.0

94.4

102.2

107.9

57.5

58.1

58.3

62.0

56.8

59.5

55.2

56.4

118.2

■■Earnings per share (yen)■■Net assets per share (yen)706.59 713.99 716.47

774.76836.39

66.9
55.5

7.1

2.6

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

7

4.0
3.3

35.6

2.5

5.7

63.2

37.46 34.07 18.75 55.23 57.32
Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Non-financial Information*1
Rate of female employees(Nihon Nohyaku Co., Ltd.)

Rate of female managers(Nihon Nohyaku Co., Ltd.)Paid leave days used*2

(%)

(%)

(days)

20.2

21.3

21.3

23.1

8.8

24.6
7.2

7.1



(Nihon Nohyaku Co., Ltd.)

8.3
11.49

7.4

12.11
10.83

11.43

5.99

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Number of male employees taking
paternity leave*3 (Nihon Nohyaku Co., Ltd.)

Number of patent applications filed(Nihon Nohyaku Co., Ltd.)■■Number of male employees eligible for paternity leave (persons) （件） ■■Patent applications filed in Japan (number)■■Patent applications filed overseas (number)*●●Number of male employees taking paternity leave (persons)

4

124
18
14

103

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

R&D expenses
(Group consolidated)(million yen)

4,690

4,452

4,461

4,681

98

14

6

7

3

9

10

95
86

55

81

8
5

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

17

17

20
10
10

2,144

44
11

29

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

Female employee maternity leave usage rate was 100%

Charitable donations(Nihon Nohyaku Co., Ltd.)(thousand yen)

Number of employees■■Nihon Nohyaku Co., Ltd. (persons)■■The Nihon Nohyaku Group (consolidated) (persons)

11,200
11,15010,9001,443 1,472 1,451 1,484

1,536

9,510

700
Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

414

395

381

379

382

Sep. 2018 Sep. 2019 Mar. 2020 Mar. 2021 Mar. 2022

*1 For FY2019, represents the period from October 1, 2019 to March 31, 2020 due to the change of fiscal year end.
*2 Applies to regular full-time and temporary full-time employees, and does not include contract employees.
*3 Includes persons employed at that time who have since retired. Applies to regular full-time and temporary full-time employees, and does not include contract employees.
*4 Number of PCT international applications filed (by transfer country basis) + Paris route or number of standard applications filed
CSR REPORT 20228

S pecial feature

Initiatives toward new agrochemical development

Promoting research withthe trinity of chemistry,
biology and safety

Akiyuki Suwa
Product Manager(insecticide),
Marketing Group,Marketing Department,
Market Development Division

Nihon Nohyaku contributes to the global development of agriculture as
an R&D driven agrochemical manufacturer. Suwa from the Marketing
Department will explain the development and production of the new
insecticide for rice paddies “Orchestra SC (suspension concentrate).”“Orchestra,” effective even against plant
hoppers that show resistance to existing
insecticides, that harmonizes withthe environment
Plant hoppers that suck nutrients from rice plants pose athreat to rice-cultivating countries in Asia, including Japan. In
worst-case scenarios, they can reduce rice yield to the point ofbringing about famine.
“Orchestra SC” (hereinafter “Orchestra”) was launched inJapan in May 2021, and its active ingredient is a newchemical compound Benzpyrimoxan (abbreviated as BPX)
originally invented by Nihon Nohyaku. BPX inhibits ecdysis ofnymphs of plant hoppers and leaf hoppers and suppresses
their population density. It is also highly effective against
populations that show resistance to conventional pesticides. It
is important to note that it has less adverse effect on humans,
animals, and aquatic organisms. Moreover, it has a low
impact on many natural enemies and beneficial insects, aswell as a low risk of phytotoxicity to crops. From its characterto preserve natural enemies and comprehensively control
plant hoppers, we named this product“Orchestra,” with the image of eachelement harmonizing together to create
beautiful music.
Generally, if one repeatedly use thesame type of pesticides (a group ofchemical compounds with the samemode of action) against pests,
resistance problem will occur thatweakens the efficacy of the pesticide. Around 2005, when
research on “Orchestra” started, brown plant hoppers began toshow resistance to conventional insecticides, and major
damage was reported in paddy rice cultivation areas in Japanand other Asian countries. Under these circumstances, we
discovered that a by-product of herbicide candidates was
somewhat effective against plant hoppers, and starting fromthat compound, we continued synthetic development andfinally selected BPX. Subsequent research confirmed that BPX
has a novel mode of action different from existing insecticides,
and that it shows excellent control of plant hoppers, resistant
to conventional products, at actual paddy rice field.
From the outset, we planned to market this product in Asia,
and we proceeded development mainly targeting in India,
which has large rice paddy cultivation areas and has been
constantly affected by plant hoppers. In Japan, as a result of
utilizing priority review system (a system that prioritizes review
over other products in development) newly introduced in
December 2018, we acquired registration in September 2020,and launched in May of the following year. We have also
developed mixed formulations with fungicides or otherinsecticides, and plan to launch products that meet needs ofgrowers. In India, Nichino India Pvt. Ltd., a Group company,
acquired agrochemical registration (active ingredient) in 2021,
and began full-scale sales of “Orchestra” from the rainyseason crop in 2022. Mixed formulations with otherinsecticides are also under development in India, and Nihon
Nohyaku and Nichino India conduct joint marketing to promote
the widespread use of “Orchestra” by Indian farmers sufferingfrom damage caused by plant hoppers (peak target of 2 million
hectares).

Received approval with exceptional speed due
to tenacious negotiations by all departments

Untreated brown plant
hopper nymph

9

CSR REPORT 2022

Brown plant hopper nymph
after BPX treatment. Ecdysis
is inhibited and damage torice paddies is stopped

The priority review system introduced in Japan in
December 2018 functions as follows: efforts are made toprioritize registration over review of other agrochemicals,
subject to (1) requests for early registration from the field,(2) new mode of action, and (3) safer profile than existingproducts. Nihon Nohyaku determined that “Orchestra” wasa product that aligns with the purpose of this priority review
system, and began negotiations with the Authorities.

Discovery

Biological
field

Verification Safety field

LaunchChemicalfield

Application for registration**/Acquisition

Invention

Challenges to practical use
Overall assessment

Candidates for
new agrochemicals

Pursuit of new agrochemicals

Creation of new products● Nihon Nohyaku’s agrochemical creation process* Application for According to the provisions of the Agricultural Chemicals Regulation Act, test results such as control efficacy, safety,
registration
toxicity and persistency of agrochemicals must be submitted to the Ministry of Agriculture, Forestry and Fisheries, andapproved (registered). Unless registered, agrochemicals cannot be manufactured, sold or used.

For the negotiations, we considered
the product having a novel mode ofaction and being effective against
pests resistant to existing pesticides as
the most important characteristics, andthe relevant departments worked
together to thoroughly collect detailed
research data. Ultimately, a researcher
Launch celebration in India
from the Research Division carefully
explained the mode of action of BPX tothe authorities representative, and in
April 2019, it became the first agrochemical subject to
Research followed on making the active ingredientreview under this system. In this way, we got registration in
into a practical formulation that is easy to use in the
one year and seven months after application in February
field (formulation research), and industrialization
2019, much less than usual two and a half to three years.
research (process chemistry research) to synthesize
This was a result of the enthusiasm and conviction ofand provide chemical compounds at a price that can be
the Development Department, the Regulatory Affairs
practically used. In this way, the comprehensive
Department, and the Research Division, as well as thestrengths of each research field were brought together
efforts of all those involved.
to finally complete “Orchestra.”In addition, we planned simultaneous development inIndia (Nichino India) and Japan (Nihon Nohyaku) for our
first trial. Producing the active ingredient BPX in India,
Promotion of all-around screening andthe largest market for planthopper control agents, is an
the trinity of chemistry, biology and safety
initiative that not only reduces the environmental impact
of product transportation, but also contributes to
At Nihon Nohyaku, researchers in the fields of
economic development in India. We set up a policy tochemistry, biology, and safety work together to efficiently
manufacture BPX in India, and while we faced many
promote to “pursuit of new agrochemicals” and to “tackle
difficulties, including registration of agrochemical
practical use” with the aim to continuously create at least
manufacturing in India, export to Japan, andone new agrochemical every three years. Synthesized
establishment of feasibility both in Japan and India, we
compounds at the Research Center are evaluated for all
solved these issues by working with local researchers
fields, as insecticide, fungicide, herbicide and so on. Thisand developers in India.
is a method called “all-around screening,” which is one of
The development and manufacturing of “Orchestra”
Nihon Nohyaku’s strengths, and it can lead to newhas become an important project that plays a core roledevelopment, not overlooking unintended effects. In fact,
in the development of overseas manufacturing andresearch on “Orchestra” was triggered by synthesis
sales sites based on our corporate vision of “Growing
research aimed at herbicides.
Global” and the expansion of market development
At early stages of synthesis research and biological
functions, including the strengthening of global
research, development of flexible chemical structures bymarketing strategies.
chemists and careful observation of biologists were major
As stated in our Basic Principles, we contribute todriving forces for this research. Following these results, we
society by ensuring a safe and steady food supply andverify safety field. In some cases, unpredictable toxicity
improving the quality of life for all. We shall continue to
may appear and research often returns to square one atcreate products like “Orchestra” in order to solve
this stage. However, in the case of “Orchestra,” we built a
problems with difficult-to-control pests that threaten thesystem for early safety evaluation and were able to quickly
stable supply of agricultural products, taking theselect chemical compounds with less safety concerns.
environment into account.

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CSR of Nihon Nohyaku
The Nihon Nohyaku Group’s Approach to CSR
One of the core management policies of the medium-term management plan “Ensuring Growing Global 2 (EGG2)” is“sustainable growth in corporate value,” and the Nihon Nohyaku Group has expressed to strengthen CSR and ESG
management through CSR activities.

Contributing to a sustainable society by supporting
agricultural production and healthy lifestyles
Expansion of CSR Management
Synchronous initiatives

Pursuit of economic value(financial side)

Pursuit of social value(non-financial side)

Three basic policies (medium-term management plan: EGG2)
Improve profitability

Technological innovation and establishment
Sustainable growth in corporate valueof next-generation businesses● Expansion of priority products ● Promotion and global expansion ● Strengthening CSR activities
of research and development
and ESG management● Cost reduction through●E xpansion into fields of biopesticides ● Promotion of operational
optimal active ingredient
manufacturing systems

and Crop Aid Products● Expansion of group synergies ● DX initiatives

reform and workstyle reform

CSR Basic Policy
In 2020, the Nihon Nohyaku Group established a CSR Basic Policy to reconstruct its philosophy structure.
Accordingly, we have constructed the foundation of our CSR activities as a Group, and in November 2021, we newly
established the “Nihon Nohyaku Group Basic Procurement Policy”. In addition, we have shared our CSR promotion
policy with four domestic Group companies and nine overseas Group companies so far, and have established asystem for full-scale deployment of “the Nihon Nohyaku Group CSR activities.”

CSR Basic Policy“Contributing to Food, Environment and Society through Technological Innovation”
Based on the Nihon Nohyaku Group Basic Principles, we will contribute to society through continuous challenges toensure sufficient food supply by innovative technologies and to protect affluent lifestyles and the environment.

CSR Promotion System
In order to enhance our CSR activities, we established the CSR Committee with functions on the same level as theManagement Committee as a body to supervise the three Committees of Compliance, Risk Management, and RC
Promotion, as well as internal control evaluations related to financial reporting conducted by the Internal Control & Audit
Department. The CSR Committee also deliberates on and approves priority issues in our business activities. Moreover,as a task force, the CSR Working Group (CSR-WG) and its Human Rights and Labor Practices Subcommittee holdregular meetings to raise awareness about effective activities and ways to solve issues related to CSR. In August 2021,
we newly established the CSR Promotion Department as an independent organization in charge of the CSR activities ofthe entire Group. In addition to strengthening the functions of the CSR Committee and the CSR-WG administrative
office, we are proceeding with the development of systems and functions aimed at promoting effective CSR management.
We have shared our CSR policies and the significance of engaging in CSR activities among whole Group companies.
We aim to co-develop CSR management from a global perspective, while taking into account of the CSR measures andits actual status at each site.

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CSR REPORT 2022

CSR of Nihon Nohyaku

CSR Promotion System

Board of Directors
President

Management Committee

CSR Committee
CSR-WG

Compliance Committee
Information Management
Subcommittee

Risk Management Committee
Environment Management
Subcommittee

RC Promotion Committee

Safety and HealthSupervisors Subcommittee

Safety Promotion
Subcommittee

Human Rights and Labor
Practices Subcommittee● Responsible Care Activities

Responsible Care (RC) promoted by the global chemical industry plays an important role as one of the main pillarsof the Nihon Nohyaku Group’s CSR activities. In addition to complying with laws and regulations, we promote
voluntary initiatives that go beyond the law and strive to improve various activities.
Responsible Care Global Charter

What is Responsible Care (RC)?
RC encompasses voluntary activities wherein each company handling chemical
substances secures “the environment, safety and health” and publishes the resultsof its activities, maintaining a dialogue and communication with society regarding
all its processes, ranging from R&D through manufacturing, sales, logistics, use,
and final consumption, to the disposal and recycling of the chemical substances.
We have six RC codes, i.e. “Environmental Preservation”, “Occupational Safety
and Health”, “Process Safety & Disaster Prevention”, “Logistics Safety”, “ProductStewardship (Chemical Materials and Product Safety)” and “Communication withSociety”, and we work to improve our activities through the continued
implementation of the PDCA (Plan→Do→Check→Act) cycle.
This initiative has been integrally promoted by global chemical industries
to safely manage chemicals over their life cycles through its activities, sothat products can contribute to improving the quality of life and sustainable
development.

● Responsible Care Promotion System

Under our CSR promotion structure governed by the CSR Committee, the RC Promotion Committee is responsible
for the RC activities of the entire domestic Nichino Group. Three Subcommittees (Environment Management
Subcommittee, Safety and Health Supervisors Committee, Safety Promotion Subcommittee) are in charge of theirrespective fields.

● Certified Management System

The Nihon Nohyaku Group has
acquired the following certifications
for the management system andcontinuously improved its
operations.

List of management system certifications
International Standards
ISO9001 (Quality Management System)
ISO14001 (Environment Management System)

Company name (applicable office)● Nichino Service Co., Ltd.
● Nichino India Pvt. Ltd.
● Sipcam Nichino Brasil S.A.

● Nichino Service Co., Ltd.
ISO45001(Occupational Safety & Health Management System) ● Nichino India Pvt. Ltd.
● Sipcam Nichino Brasil S.A.
● Nihon Ecotech Co., Ltd.
ISO17025(General requirements for the competence of testing(Osaka and Fukushima
and calibration laboratories)
Analytical Technology Center)

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CSR of Nihon Nohyaku
The Nihon Nohyaku Group’s Approach to CSR

Initiatives toward SDGs
The SDGs adopted as the “2030 Agenda” and the “SDG Compass” formulated for companies at the United Nations
Summit (September 2015) present global targets and corresponding guidelines for the sustainability of mankind. In
short, one could say that they are initiatives to simultaneously solve environmental issues and poverty with innovativetechnologies. The Nihon Nohyaku Group has always tackled technological innovation that responds to various social
requirements in our agrochemical business, which has been our core business. We have contributed to the eradicationof hunger and the realization of a prosperous life for all through stable production of agricultural products, considering
sustainable environmental conservation. In this way, the Nihon Nohyaku Group’s business activities are linked to theachievement of SDGs.
For further understanding of SDGs within the Nihon Nohyaku Group, CSR Promotion Department established SDGs
Working Team (SDGs-WT) to distribute educational content and support awareness-raising activities in each Group
company. Moreover, we widely disseminate information to stakeholders about our active participation in SDGs andtheir significance through radio commercials*, etc.
* Nippon Broadcasting System, Inc.’s SDGs campaign

Organization of CSR Priority Issues
In order to effectively promote CSR activities aligning with the Nihon Nohyaku Group’s business, we have organized
an overall image of priority issues from a global perspective based on the actual situation.
Step

Centered on CSR-WG members from the General Affairs & Public Relations Group and related departments,
which oversees CSR-related measures, a wide range of projects and implemented measures related to each
ESG area, especially issues requiring urgent response, have been identified.
A total of 74 projects and issues were identified, and we organized them into 45 themes based on theirrelationship with the 37 issues of the 7 core subjects established in ISO26000, the global guideline for CSR
management, and created a comparison table for each core subject. After that, we analyzed the level ofpriority by mapping based on impact and importance from the perspective of management and stakeholders(figure and table below).
The results of this analysis led to the establishment of the Human Rights and Labor Practices Subcommittee(see p.17), which plays a role in establishing the system for promoting CSR.
Priority classification

(I)

Big

(II)

●1 Priority issues
(V)

(IV)

(IX)

(VIII)(VII)●2 Relatively high priority issues
igh priority issues from a management●3 Hperspective

Medium

(VI)

Small

Step

Importance to management

(III)

Small

MediumBig

Importance to stakeholders

Step

13

Sections

I
II, IV, V
III, VIigh priority issues from a stakeholder●4 Hperspective

VII, VIII●5 Low priority issues for the time being

IX

In selecting the Nihon Nohyaku Group’s seven priority issues, we identified common ESG issues andrearranged some themes based on the relationship with the core subjects of ISO26000, while considering
the Group’s business situation and future expansion of global management (see p.14). Through these
efforts, we aim to effectively promote CSR in line with the business situation.

CSR REPORT 2022

CSR of Nihon Nohyaku

Seven CSR Priority Issues
The organized seven CSR priority issues clearly show their relationship with ESG and SDGs, and we work on
business activities with a strong mind of contributing to sustainable development.
Seven Priority Issues and Major Initiatives
Priorityarea

E

Environment

Priority issue

Major initiatives

Raising the level ofenvironmental management● Establishing global environmental management● Initiatives to reduce GHG emissions and save energy● Consideration for biodiversity● Group expansion of environmental preservation(Environmental preservation, RC activities)

Relationship with SDGs

activities

Expansion ofhuman rights management● Advance human rights management by establishing

Enhancing the safety culture● Initiatives toward zero accidents● Eliminate serious accidents at production sites● Promote Product Stewardship through the(Diversity & inclusion (D&I), and humanresource development)(Occupational safety & health, productsafety)the Human Rights and Labor Practices Subcommittee● Global expansion of human resources training● Promote female participation in the workplace● Appointment of non-Japanese people● Work-life balance

product life cycle● Establishment of Group Basic Procurement
Policy● Promote white logistics, provide high quality

S

products

Society
Development of technologies
and products that meet needsof society(Pursue to satisfy our customers)

animals● Create Eco-harmonized products● Contribute to smart agriculture● Communicate with our shareholders andStrengthening corporate andorganizational governance● Strengthen the corporate governance structure● Effective Board of Directors● E nhance and strengthen internal control systems

Governance (Corporate governance, CSR management)
Expansion of compliance andGeneral risk managementfor
all ESGand animal health products● Ethical considerations concerning testing on

Community Involvement(Dialogue with stakeholders)G● Create new agrochemicals, pharmaceuticals,(Sustainability management: BCP)

investors● Communication with our customers● Support regional revitalization● Appropriate support activities in the event ofdisaster● Initiatives toward anti-corruption● Global expansion and management● Enhance BCP● Respond to TCFD Recommendations

CSR REPORT 2022

14

Raising the Level of Environmental Management
Response to Climate Change
Establishing Global Environmental Management

Domestic supply chain emissions(total amount of Nihon Nohyaku Co., Ltd. + Nichino Service Co., Ltd.)GHG emissions reduction targets of the Nihon Nohyaku
Group are in line with each target country by country, andwe have set new global targets for Scope 1*1 and Scope 2*2
in 2022. Scope 3*3 has been calculated for Japan, and theglobal situation will be confirmed going forward.

Scope 1

Scope 23,370 tons of CO

6,719 tons of CO

2

2

Total emissions*1 Direct emissions of GHG by the reporting company (fuel combustion, industrial
processes).
*2 Indirect emissions from the use of electricity, heat, or steam supplied by others.
*3 Other indirect emissions besides Scope 2 (Emissions by others related to the company’s
activities). Calculated in accordance with the “Basic Guidelines on Accounting forGreenhouse Gas Emissions Throughout the Supply Chain” formulated by the Ministryof the Environment and the Ministry of Economy, Trade and Industry (METI).

77,063

Scope 3

tons of CO2

66,974 tons of CO

2ihon Nohyaku and subsidiary
The Nihon Nohyaku Group* aims to be carbon neutral * Ncompanies
that have manufacturing
sites

India: 2070

Japan & Brazil: 2050

CO2 Emissions Reduction Policy

CO2 emissions (thousand tons)

40

33−23% compared to 2020

30

10
0

2050

25

Japan & Brazil
Carbon neutral

India

20

Reduction of
GHG emissions associatedwith business activities
2030 target(Scope 1+2)

2070

14

India

Carbon neutral
Japan &
Brazil
2020

Energy

2030

0

0

2050

2070

(year)

Active initiatives toward energy saving Energy saving and improved efficiency through innovative technologies

Contributions to society
through our core business

Procurement of renewable energy, introduction and operation of renewable energy equipment

23% reduction(compared to FY2020)

We aim to gradually
become carbon neutral
while watching changes
in energy policies
in each country.

Technological development that contributes to GHG reduction

Initiatives to Reduce GHG Emissions
CO2 accounts for almost all of the Nihon Nohyaku
Group’s GHG emissions. CO2 emissions in FY2021
increased by 11.6% compared to the previous year mainly
due to an increase in production amount (see the data
sheet for details on CO2 emissions, etc.)

Domestic CO2 emissions (Scope 1+2)(t)

15,00011,93810,00010,474

9,384

8,687

9,039

2019

2020

10,0895,000
0Initiatives to Save Energy

2013

2017

2018

2021

(FY)

In our Group, Nihon Nohyaku and Nichino Service are
specified business operators defined in the Energy
Conservation Act*, and they promote energy conservation
with the goal of lowering our energy intensity. Other Group
companies in Japan also strive to save energy according totheir business forms, and going forward, we will update thesituation overseas and promote further energy saving (seethe data sheet for details such as energy intensity, etc.)* Abbreviation for the “Act on the Rational Use, etc. of Energy”

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CSR REPORT 2022

Switch to LED

Introduction of energy-saving cooling equipment(Research Center)

Raising the Level of Environmental Management

Environmental Preservation
Consideration for Biodiversity
The Nihon Nohyaku Group responds to laws andregulations in each country, and works to develop Ecoharmonized products aligned with the perspectives of theenvironment, safety and health utilizing the latest scientificknowledge (see p.23). As a new initiative, Nichino Ryokka
participates in the “Satochi-Satoyama (Socio-ecological
Production Landscape) Revitalization Project by Industry,
Academia, and Government” in Nasukarasuyama City, Tochigi
Prefecture, which is one of the government-approved regional
revitalization projects. This project aims to realize sustainable
natural areas by realizing efficient weed management using
Nichino Ryokka’s PGR, flurprimidol granule, and cultivating
nectar plants in abandoned farmlands.

The “Satochi-Satoyama Revitalization Project by Industry, Academia, and Government”

Initiatives to Reduce Waste
All plants separate waste and work to reduce final landfill by practicing the 3R (reduce, reuse and recycle of waste)
system. In FY2021, Nichino Service Fukushima and Saga Plants achieved zero emissions*. Moreover, domestic
Group companies continued to implement green purchasing initiatives by selecting office supplies designed to reduce
environmental impact, and in FY2021, a green purchasing rate of 99.9% was recorded, achieving our target (95% orhigher).
* The final landfill amount of waste shall be 1% or less of the volume.

Promoting Environmental Preservation Initiatives at Work and at Home
Group company offices in Japan are declare their initiatives for Fun to Share, supported by the Ministry of theEnvironment. In addition, the Environment Safety Department issues “Environment Safety News” to share information
with all employees. The newsletter features recent information related to environmental safety. Through these
activities, we work to ensure that employees are fully aware of environmental laws and regulations and promote
environmental preservation initiatives at work and at home.
● Global Warming Countermeasures
A quiz was implemented in June 2022 to share information on the “Zero Carbon Action 30” promoted by theJapanese government. There was a large number of participants, and it was an opportunity for each individual tothink about global warming countermeasures that they can implement at home through their own actions.
● Plastic Reduction
As the “Act on Promotion of Resource Circulation for Plastics” was implemented in FY2022, we conduct awarenessraising activities through Environment Safety News, etc. concerning actions that individuals can do to reduce plastic.

Group Expansion of Environmental Preservation Activities
As part of RC activities, domestic Group companies use
the PDCA cycle to formulate plans, monitor activity status,
and implement improvement measures for environmental
preservation initiatives such as promoting energy
conservation, reducing GHG emissions, and implementing
the 3Rs. Our manufacturing sites in the world have acquired
the ISO14001 certification. We strive for environmental
preservation initiatives by operating an Environment
Management System, and we promote global
environmental preservation activities. Nichino India Pvt. Ltd.
(India) works on activities to set up water supply points inorder to conserve water resources, and in FY2021, they
installed water supply points at 14 locations in India.

Water supply points

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16

Expansion of Human Rights Management(Human Rights, Creation of a Comfortable Work Environment)
Initiatives for Human Rights
Advancing Human Rights Management by Establishing the Human Rights and Labor Practices Subcommittee
The Nihon Nohyaku Group has positioned respect for human rights as
one of the most important management issues for business continuity, andwe work on it together as a Group. In accordance with international norms
such as the Universal Declaration of Human Rights and the United Nations’“Guiding Principles on Business and Human Rights,” we have establishedthe Nihon Nohyaku Group Basic Human Rights Policy to respect the humanrights and diverse values of all stakeholders involved. In addition, we set“expansion of human rights management” as a CSR priority issue, and, as asystem for promoting this, we have established the Human Rights andLabor Practices Subcommittee as an advisory body to the CSR Working
Group, and work on various human rights-related issues within our Group.

The Nihon Nohyaku Group
Basic Human Rights Policy
The Nihon Nohyaku Group
respects the human rights
and diverse values of
our all stakeholders,
including our customers,
and aims to achievea society free of discriminationand prejudice.

Human Rights Due Diligence
With the aim of promoting human rights management in our business activities, the Nihon Nohyaku Group will build
a human rights due diligence system that complies with the United Nations’ “Guiding Principles on Business and Human
Rights.” Specifically, we will identify human rights risks in the value chain and work to prevent, mitigate, and correct
human rights violations. If a negative impact on human rights resulting from the business activities of the Nihon Nohyaku
Group is identified, we will hold discussions with relevant stakeholders and take appropriate corrective measures.

Human Resources Management
Approach to Human Resources Management
Based on the belief that employees are the most important management resource for the company, Nihon Nohyaku
positions human resources as “human assets” and promotes the development of an environment in which all
employees are motivated to contribute and are able to demonstrate their full abilities. Moreover, as a part of improving
the work environment, we promote personnel system reforms based on the concept of shifting from “emphasizing theaccumulation of past experience” to “emphasizing current execution capabilities + expectations for future participation.”
The working environment has changed a lot due to diversification of work values, increase in dual-income households,
and labor shortages caused by the declining birthrate and aging population. Against such backdrop, we willcontinuously to improve employee motivation and realize diverse work styles.

Approach to Recruiting and Training of Human Resources
We are promoting diversity based on the recognition that the active participation of human resources with varied
experiences, skills, and attributes and the existence of diverse perspectives and values can be a strength in ensuring
the sustainable growth of a company. In order to expand our business globally and strengthen our competitiveness as
an R&D based company, we continue to recruit, train and promote to managerial positions a diverse range of humanresources, including women, foreigners and mid-career recruits. We are endeavoring to improve the work environmentand reform corporate culture so that every employee can play an active role in all areas of recruitment, employment
and promotion by making the most of their individuality and realize a work style that aligns with their values, regardlessof nationality, age, gender, race, religion, sexual orientation and/or disability.

Global Expansion of Human Resources Training
In promoting the Nichino Group-Growing Global as the Group Vision, we conduct selective training programs for Group
employees in order to systematically nurture executive candidates and next-generation leaders who will play a core role infuture management. We also promote the dispatch of researchers to overseas research institutes and the secondment of
employees to overseas Group companies to develop global human resources. In the future, we plan personnel exchanges
among overseas Group companies and the implementation of OJT at Nihon Nohyaku.

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CSR REPORT 2022

Expansion of Human Rights Management (Human Rights, Creation of a Comfortable Work Environment)

Diversity & Inclusion
Promoting Female Participation in the Workplace
Nihon Nohyaku has formulated an action plan for promoting female participation in the workplace and actively
realize it. In addition to developing and raising mind of female employees as managers, the percentage of female
managers increased from 2.0% in April 2011 to 8.3% in March 2022 as a result of changing mind of male managers
toward the promotion of female participation in the workplace. In June 2020, we appointed our first female Executive
Officer through an internal promotion. We will set and achieve appropriate KPIs, such as the percentage of female
managers and the percentage of women among new employees.
Rate of female managers (Nihon Nohyaku Co., Ltd.)

Rate of female employees (Nihon Nohyaku Co., Ltd.)

(%)

(%)

8.8
7.2

7.1

7.4

Sep. 2018

Sep. 2019

Mar. 2020

Mar. 2021

8.3

Mar. 2022

20.2

21.3

21.3

Sep. 2018

Sep. 2019

Mar. 2020

23.1

24.6

Mar. 2021

Mar. 2022

Appointment of non-Japanese colleagues
In 2011 and 2021, we appointed non-Japanese Presidents from overseas Group companies as Executive Officers of
Nihon Nohyaku. We will continue to support the growth of overseas subsidiaries and develop human resources with
the qualifications of Executive Officers. We will also proceed the appointment to managerial positions and active
recruitment of foreign colleagues for encouraging internal promotion to officers.

Comfortable Work Environment
Work-life Balance● Realization of Diverse Workstyles

Amid the diversification of work values, Nihon Nohyaku has introduced various systems to realize diverse workstyles
so that employees can make the most of their unique abilities and sensibilities. Going forward, we will shorten thecore time of the flex-time work system, shorten working hours, and further expand the working from home system.
● Encouraging the Use of Paid Leave
We aim to have our employees use an average of ten days or more of paid leave. As an initiative to encourage
employees to take paid leave, we have established planned leave twice a year based on a labor-managementagreement. Moreover, we promote employees to use the days in between holidays broken up by one or two
workdays as days for paid leave, and/or to take paid leave in conjunction with summer and winter holidays.
● Maintaining and Promoting the Health of Employees
At Nihon Nohyaku and domestic Group companies, we conduct medical examinations for all employees, as well as
consultations with industrial physicians according to employees’ health conditions. Stress checks are held for all
employees who request it in Japan, and based on analyses of the results, we reach out to employees in high-stressworkplaces. We also use external contractors to establish the Nichino Group Consultation Desk, where employees
and their families can consult on all types of health issues, including mental health.

Labor Relations
Nihon Nohyaku and the Nihon Nohyaku Labor Union have concluded a labor agreement, and discussions are held on
equal footing at the labor-management council. We consider labor unions to be one of our important stakeholders, andwe have built good labor relations based on mutual understanding and trust, with a shared understanding of “improving
the company and improving the lives of employees.” Moreover, recreational activities jointly organized by labor andmanagement are held at each office in order to deepen communication among employees and to promote the equal
relationships. (Labor-management council: 14 times a year (including one roundtable discussion with top management);
policy explanation meetings for each division: once a year; labor-management study sessions: five times a year)

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Enhancing the Safety Culture
Occupational Safety & Health, Process Safety & Disaster Prevention
Occupational Safety & Health Audit System
Once a year, Nihon Nohyaku audits overall RC activities, including occupational safety & health, at all domestic
Group offices. Each office promotes initiatives aimed at zero accidents, and in the event of an accident, we investigate
the cause and formulate measures to prevent recurrence. We verify these initiatives through audits, and will consider
building a global audit system that uses RC and ISO methods.

Initiatives toward Zero Accidents
Domestic Group companies implement various initiatives to achieve zero accidents, sharing information among offices,and horizontally deploying countermeasures. Regular safety and health committee meetings are held at all sites,
regardless of whether they are offices or laboratories etc., to prevent accidents through the sharing of danger information,such as reports about “near misses*1” and “anticipatory near misses*2”. All commercial vehicles are equipped withdashboard cameras, and ratings of driving by insurance companies are utilized to raise awareness about safe driving.
*1 A frightening experience where someone almost got injured. *2 Anticipating a frightening event before it happens.

Avoiding Accidents in the Research StageTo implement a high level of safety management for research activities at the
Research Center, we continuously encourage employees to acquire national
qualifications, such as dangerous object handler qualifications, and increase thenumber of qualified personnel. In addition, we work on safety activities with anemphasis on ensuring the safety of employees and avoiding accidents throughKiken Yochi (risk prediction) activities, risk assessment, safety education, andsafety patrols centered on sites’ safety and health committees.

Large-scale disaster training(emergency broadcast)Eliminating Serious Accidents at Production Sites
Nichino Service has acquired ISO45001 and promotes safety activities andequipment maintenance using an Occupational Safety & Health Management System.
Risk assessment is carried out on a 5-stage scale and as a company policy to eliminate
level 3 or higher, we work to reduce risks by reviewing work procedures and improving
equipment based on the results of assessment. For each type of training, the conditions
are changed every time to ensure the high effectiveness of the training. In FY2021,
Nichino Service Saga Plant received an award from the Japan Association for Safety ofHazardous Materials in recognition of its safety activities for many years, such as
appropriate management of chemical substances.

Product Stewardship (Chemical Materials & Product Safety)
Appropriate Management of Chemical Substances
The Nihon Nohyaku Group has provided Safety Data Sheets (SDS) for each item, both inside and outside Nihon
Nohyaku, to ensure the safe handling of chemical substances, samples for testing and research purposes and otherchemical products, followed by preventing injuries and accidents. At present, it is necessary to comply with GHS inlaws and regulations related to chemical substances from a global perspective, and we comply with the regulations ofeach country. We proceeded with preparations for the operation of an automated SDS preparing system to refine andstreamline the operations, and it started in Japan in FY2021. Moreover, we continue elimination of poly (oxyethylene)
nonylphenyl ether (NPE) from our products, since it’s categorized as an endocrine disrupting substance that degrades
into the environment.

Promoting Product Stewardship through the Product Life Cycle
In addition to complying with laws and regulations, the Nihon Nohyaku Group strives to manage safety throughout the
product life cycle, ranging from R&D through manufacturing, use and disposal, and provides appropriate information.
We provide the Japan Poison Information Center with SDSs in the case responding to inquiries from medical institutionsin the unlikely event of a poisoning accident related to our products.
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CSR REPORT 2022

Enhancing the Safety Culture

Supply Chain Management
The Nihon Nohyaku Group Basic Procurement Policy
Based on our CSR Basic Policy, we newly established “theNihon Nohyaku Group Basic Procurement Policy” in November
2021 as a basic policy for CSR procurement.
Cooperation with business partners is essential to fulfill social
responsibilities throughout the supply chain. We aim to realize asustainable society by building good relationships with ourbusiness partners, asking them to agree with our Basic
Procurement Policy, and putting it into practice together.

onsideration for human rights, working● Cenvironment,
peace and fairness● Compliance with laws and social norms● Fair transactions and equal opportunities● Selection of business partners● Promotion of mutual development (partnerships)
nsuring appropriate information● Emanagement
and intellectual property rights
Ensuring
qualityand safety●
Considerationforthe environment●
Socialcontribution
●
1
2
3
4
5
6
7
8
9

Initiatives toward Sustainable Procurement● CSR-related Procurement Questionnaire Survey

In February 2022, we conducted a CSR procurement questionnaire survey for Nihon Nohyaku’s business partners inJapan, also providing information on our Basic Procurement Policy. As of the end of March 2022, approximately 70%
of our business partners have responded. We will continue to work with our business partners on sustainableprocurement activities based on our Basic Procurement Policy.
● Green Procurement
We have established the “Nichino Group Green Procurement Standards” and work on eco-harmonized procurement.
The green procurement rate in FY2021 was 98.9% with an improvement from the previous year. We will continue toimprove our green procurement rate.

Logistics Safety
Promoting White Logistics
Nihon Nohyaku has endorsed the White Logistics Movement, an initiative put forward by Japan’s Ministry of Land,
Infrastructure, Transport and Tourism (MLIT), Ministry of Economy, Trade and Industry (METI) and Ministry ofAgriculture, Forestry and Fisheries (MAFF), and submitted our Declaration of Voluntary Action.
Our modal shift rate* in 2021 was 9.0% (results in 2020: 8.9%, target: 10.0%). We will continue to work on logistics
safety, including the reduction of environmental impact.
* Modal shift rate (ratio of railway freight and marine transport) = (railway freight and marine transport amount) / (total transport amount) x 100

Quality Management
Providing High Quality Products
We work to ensure product quality and safety in every stage of the value chain, from R&D to production, sales,
logistics, use and final consumption as well as disposal and recycling.
Our Production Division and Nichino Service work together in conducting detailed evaluations of product quality,
while striving to maintain and improve product quality. In addition, we adapt the management methods of GMP(production management and quality control standards for pharmaceuticals) for quality enhancement in our productionof active ingredient.
We conduct risk management for product liability (PL) to prevent issues. We use the internal visualization of
response status for complaints received in relation to our products to promote rapid and accurate response.

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20

Development of Technologies and Products that Meet Needs of Society
Product Development
Global R&D
As an R&D driven company, Nihon Nohyaku builds
strategies based on accurate analysis of the businessenvironment and market changes and works on early
development of new agrochemicals as well as maintenanceand/or expansion of existing products from a global
perspective. We have continuously tackled to create worldclass technologies by enhancing the functions of ResearchCenter and Manufacturing Technology Research Center,
which carry out cutting-edge research, and by strengthening
the development system to respond to global market needs.
We also promote licensing activities effectively, using
intellectual property such as patents, and improve our
product portfolio to expand our business.

Research Center

R&D expenses (Group consolidated)

Number of patent applications filed (Nihon Nohyaku Co., Ltd.)(million yen)

(Number)

5,000

4,690

4,461

4,452

■Patent applications filed in Japan ■Patent applications filed out of Japan*

160

4,681

4,000

124

120

103

98

3,000
80

2,144

2,000

55

81

40

1,000
0

95
86

Sep. 2018 Sep. 2019

Mar. 2020

Mar. 2021

0Mar. 2022

17

17

Sep. 2018 Sep. 2019

20
10
10
Mar. 2020

44
29

11
Mar. 2021

Mar. 2022* Number of PCT international applications filed (by transfer country) + Paris route or Number of standard applications filed

Nihon Nohyaku’s Agrochemical Creation Process
The creation of new agrochemicals takes more than ten years, requiring many processes from research anddevelopment to launch as new products. Under such circumstances, we have continuously developed one newmolecule every three years.

Discovery

Biological
field

Verification Safety field●Synthesis research*1●Process chemistry research*2●Formulation research*3●Insecticide research●Fungicide research*4●Herbicide research●Product safety andpharmaceutical research 5*●Metabolism andenvironment research

0 year21

CSR REPORT 2022

4th yearApplication for registration** 6/
Acquisition

ChemicalInvention
field

Challenges to practical use
Overall assessment

Candidates for new
agrochemicals

Pursuit of new agrochemicals

7th yearDevelopment of Technologies and Products that Meet Needs of Society

Creation of New Agrochemicals
Creation of new active ingredient for agrochemicals takes
more than ten years as well as significant investment,
requiring many processes from research and development
to launch as new products. Under such circumstances, wehave constantly developed new agrochemicals. We havecontributed to ensuring a safe and stable food supply bylaunching, to date, flubendiamide, an insecticide for
Lepidoptera, pyraziflumid, a broad-spectrum fungicide, andpyraflufen-ethyl, a PPO inhibitor herbicide.
NBA Members Visit

Flubendiamide WG

Pyraziflimid SC

Pyraflufen-ethyl EC

Ethical Considerations Concerning Testing on Animals
The Nihon Nohyaku Group has established internal regulations concerning testing on animals in accordance with the“Act on Welfare and Management of Animals” and related guidelines. We also promote animal welfare throughtechnological development and research initiatives utilizing cultured cells and computer modelling.

*1 Synthesis research
For new chemical candidates to control pest infestation or weeds, we try to
search substances that could become new agrochemicals, by using unique
ideas and the latest research methods such as computational science.

Creating
somethingfrom nothing!

10th year*3 Formulation research
We conduct formulation research to maximize the performanceof agrochemicals and seek for their ease of use, without
impairing the effects and safety of the compounds.

LaunchCreation of new products*2 Process chemistry research
We develop a manufacturing method on chemical compounds with complex structures atindustrial level and at low cost to provide customers with products at reasonable price.
Formulation technology
enables small amounts ofproducts to be applied
uniformly over large fields.

*4 Biological research
We assess all possible effects that chemical compounds may have on pest infestations andweeds to determine their potential as agrochemicals.
*5 Product safety research
We thoroughly verify safety to check how chemical compounds impact non-target organisms and theenvironment. In addition, we apply our own technologies to research and develop pharmaceuticals.
*6 Application for registration
According to the provisions of the Agricultural Chemicals Regulation Act, test results such as
on efficacy, safety, toxicity and persistency of agrochemicals must be submitted to the Ministryof Agriculture, Forestry and Fisheries, for approval (registration). Unless registered,agrochemicals cannot be manufactured, sold or used.

CSR REPORT 2022

22

Development of Technologies and Products that Meet Needs of Society
Product Development

Creating Eco-harmonized Products
As agrochemicals are put into natural ecosystems like cultivated land, their relationship with the environment is a toppriority for R&D and commercialization. Over the past few decades, we have contributed to the world’s food production
by developing eco-harmonized agrochemical products that reduce impact on environmental organisms and/or amountof residue.
In the registration requirements for agrochemicals, there is an increasing demand for test results on environmental
fate such as ecological effects on non-target organisms and persistency, and this trend could continue in the future. In
addition to such stricter registration requirements, we aiming to develop “Eco-harmonized products” that are lessadverse to the environment from the perspective of promoting SDGs, CSR activities, and ESG management.

High

Examples of Eco-harmonized products

Eco-harmonizedproducts group
Waste disposal

Products with low impact
on water organisms,
natural enemies andbeneficial organisms

Sustainable society

Low

f ag

r ic u loLowa recycling-oriented
societytio nProducts withless concern
on environmental
persistency

Contributing to therealization ofHigh

Estimate for environmental safety

Anti-frost agent
Suppression of
frost damage

lity

Products effective atlower dose rate

Effective use

qua

Products with low
toxicity to mammaliananimals

Coffee grounds(created when manufacturing
canned coffee)

Pr o d u c

Estimate for human and livestock safety

Conceptual diagram of Eco-harmonized products

tural cro ps wit h h

ig h“Frost Buster” is a new anti-frost material jointly implemented
by Asahi Quality & Innovations, Ltd. and KUREi Co., Ltd.,a venture company from Kansai University.

Initiatives toward Advanced Technologies
Contributing to Smart Agriculture
We have accelerated our efforts for “smart agriculture”
to solve agriculture related issues, making use of
cutting-edge technologies. As part of our activities, we
worked with several agrochemical manufacturers topromote “LeiMe AI Disease, Pest & Weed Analysis” andreleased it in April 2020 as an application on
smartphone. As of the end of June 2022, 12 crops canbe diagnosed and we plan to expand it in the future. We
will continue to work on expanding crops that can be
diagnosed, enhancing functions, such as making it
multilingual, and strengthening overseas development.
AgriMart Corporation also started a sanitary pest
management support service, “LeiMe AI Pest
Identification and Counting System,” in April this year.

LeiMe image diagnosis

Expansion to Pharmaceuticals and Animal Health Products
In Nihon Nohyaku’s pharmaceutical and animal health products business, we have applied the technologies from ourcore business of agrochemical to the development of topical antifungal agents (medicine for athlete’s foot) and flea andtick control agents for animals. Our invention “lanoconazole” and “luliconazole,” are highly effective against trichophyton,
the fungus that causes athlete’s foot.

23

CSR REPORT 2022

Development of Technologies and Products that Meet Needs of Society/Community Involvement

Community Involvement
Dialogue with Stakeholders
Communication with our Shareholders and Investors
In order to build a foundation for constructive dialogue with stakeholders, Nihon Nohyaku has established a disclosure
policy. We accordingly, strive to appropriately disclose corporate information, including non-financial information, ensure
the transparency of corporate management and holds financial results briefings as well as individual IR meetings.
Video recordings of financial results briefings are available on demand on our website.

Strengthening Communication with our Customers● Association Memberships

Through various associations, we will contribute tosociety by educating and raising awareness about thecorrect use of agrochemicals and improving consumers’
correct understanding how to use agrochemicals.

● Japan Crop Protection Association
Industry
Associations ● Japan Chemical Industry Association● Japan Association for Advancement of
Phyto-Regulators● Green and Safety Promoters Association● Customer Consultation Service

We have established consultation desks based on product fields. Regarding domestic agrochemical products, wewelcome inquiries from customers via telephone or inquiry form on our website. It is also important for us to hear
general questions and inquiries from consumers regarding agrochemicals. By providing relevant information, we
hope to improve understanding of our agrochemicals.

● Disclosure of Business Information

For deeper understanding of our business activities by our
stakeholders, we work to provide timely and appropriate information
disclosure and to enhance the content of the information. We also
provide a service called “LeiMe’s Agrochemicals Chat Room,” wherea cartoon character called LeiMe provides easy tounderstand explanations of matters such as productinformation and the safety of agrochemicals on our
website.

Our website (top page)https://www.nichino.co.jp/en/index.html

Supporting Regional Revitalization
Office Training and Tours
Many festivals and meetings held by neighborhood communities in
the locations of our offices were suspended in FY2021 in order toprevent the spread of COVID-19. We participate in meetings held byregional councils, etc. on line.
In FY2021, we implemented sufficient measures to prevent infection
and received 60 people from seven groups for an office tour at
Naganuma Nursery.

Nichino Scholarship FundTour at the Naganuma Nursery

In FY2008, we started the Nichino Scholarship Fund, commemorating the 80th anniversary of our foundation. This
year marks the 15th year of the fund. We have provided scholarship funds to students from 9 agricultural colleges inJapan to support agricultural careers of more than 250 students in total. We were unable to hold agrochemical
workshops for scholarship students in 2021 due to COVID-19, but we distributed related documents to students todeepen their understanding of agrochemicals. We hope this system will aid in the development of successors to the
future of Japanese agriculture.

Support Activities for Ukraine
In March 2022, the Nihon Nohyaku Group made an donation through UNICEF with the aim of offering humanitarian
aid to Ukraine and Ukrainian refugees.

CSR REPORT 2022

24

Strengthening Corporate and Organizational GovernanceCorporate GovernanceApproach to Corporate GovernanceThrough efforts to realize the Nihon Nohyaku Group’s Basic Principles, Action Charter and Group Vision, we aim to
be a corporate group that is trusted by various stakeholders like shareholders, customers, employees, business
partners and local communities. We will build an effective corporate governance structure to achieve sustainablegrowth and improve medium to long term corporate value.

Corporate Governance Structure and Initiatives
By appointing Audit and Supervisory Committee members, who
are responsible for auditing the execution of duties by Directors,
as members of the Board of Directors, Nihon Nohyaku has
adopted the form of a company with an Audit and Supervisory
Committee to strengthen the supervisory function of the Board of
Directors and enhance corporate governance.
In addition, we have established the Governance Committee(members: 7 as of March 31, 2022), where a majority of members
are independent officers, as an advisory body to the Board of
Directors. The Governance Committee further enhances corporate
governance by deliberating and reporting on the appropriatenessof the process for appointing/dismissing candidates for Director of
Nihon Nohyaku, their qualifications and reasons for appointment
upon a consultation request from the Board.

Board of Directors (FY2021)● Directors(Excluding Directors Serving as Audit

and Supervisory Committee Members)● Directors Serving as Audit andSupervisory Committee Members● Independent Outside Directors(percentage)● Female Directors (percentage)● Average attendance rate at
Board of Directors meetings● Average time required for
Board of Directors meetings

: 10
: 5
: 5 (33.3%): 2 (13.3%): 99.6%: 90 minutes

Analysis and Evaluation of the Effectiveness of the Board of Directors
Nihon Nohyaku’s Board of Directors conducts a questionnaire survey for Directors every year concerning theeffectiveness of the entire Board of Directors. Based on the results of this questionnaire survey, the GovernanceCommittee is consulted regarding the results of analysis and evaluation of the effectiveness of the Board of Directors.
According to the contents of the reports received, efforts are made to continuously improve identified issues.

Policies on Determining Officers’ Remuneration
The policies for determining remuneration etc., for individual Directors are determined by the Board of Directors after it
receives opinions from the Governance Committee, which is a voluntary advisory body of the Board of Directors, on
officers’ remuneration. The ratio of type of remuneration for Executive Directors shall be determined in consideration offactors including long-term R&D based business characteristic of Nihon Nohyaku, the Director’s position, duties,
standards at other companies and social trends. The ratio between basic remuneration, bonuses and performance-linked
stock-based remuneration during the period to which a medium-term management plan applies will be about 8:1:1.
Corporate Governance Diagram
General Meeting of Shareholders
Governance Committee

Board of Directors

Audit and Supervisory Committee

Accounting Auditor

PresidentInternal Audit Department
Management Committee

Compliance Committee

25

CSR REPORT 2022

CSR Committee
Risk Management
Committee

Responsible Care
Promotion Committee

Strengthening Corporate and Organizational Governance

Policies and Procedures for Appointing Candidates for Officers
Nihon Nohyaku considers the diversity of Board of Directors members, and selects candidates for Director (excluding
Audit and Supervisory Committee members) from those who possess high ethical standards as well as personality,
insight, ability and extensive experience. In addition, candidates for Director serving as Audit and Supervisory Committee
members shall be selected from a broad pool of candidates in accordance with eligibility requirements established by
Nihon Nohyaku, with the approval of the Audit and Supervisory Committee. Candidates for Independent Outside Director
shall be selected from a broad pool of candidates in accordance with eligibility requirements (including fulfilling Nihon
Nohyaku’s independence standards) established by Nihon Nohyaku.

Enhancing and Strengthening Internal Control Systems
At Nihon Nohyaku, the Audit and Supervisory Committee exercises management evaluation authority based on two
ways; one by checking the legality and validity of the execution of business by Nihon Nohyaku and Group companies
and the other by right to state opinions regarding the appointment of Directors who are not Audit and Supervisory
Committee members, so that checking function of the governance structure would be enhanced.
Internal Control & Audit Department conducts internal audits based on the internal audit plan set forth each fiscal
year to promote the improvement of operations. They exchange information and hold meetings in a timely andappropriate manner so that each audit, including accounting audits byauditing firms, would function efficiently and effectively.

Message from our outside officers
Nihon Nohyaku is an R&D based agrochemical manufacturer with thelongest history in Japan and we have continuously taken on tackles toensure stable food supply through technological innovations and to protect
affluent lifestyles and the environment.
Based on my experience in managing a business company in the USA, I
have strengths in the fields of corporate management, overseas business,and finance and accounting. At the meetings of Board of Directors, I haveactively spoken up about important proposals related to item acquisition andKazuyoshi Tachibana
new investment projects in addition to maintaining the business base andOutside Director
operating overseas subsidiaries.
Nihon Nohyaku is listed on the Tokyo Stock Exchange Prime Market, atthe same time, it is a subsidiary of ADEKA Corporation, which owns 51%. Based on this, I would like to express mythoughts on three points regarding Nihon Nohyaku’s governance.
The first point is about the composition of the Board of Directors. The Board of Directors has active discussions
and functions well and it will be necessary to increase the percentage of women (currently 2 out of 15) and toinclude Board of Directors members from overseas. The time may come when discussions in English become thenorm at Board of Directors meetings.
The second point is about the response to internationalization. Our overseas sales ratio exceeds 60% and isincreasing year by year. Risk management at overseas Group companies is becoming increasingly important.
There is also the possibility that Directors whose native language is not Japanese will appear. We already have two
non-Japanese Executive Officers and the opinions of overseas Group employees are directly reflected in the
management of the Nihon Nohyaku Group. Their opinions will likely become even more prominent in the futurewhen non-Japanese Directors are appointed.
The last point is about research and development. Nihon Nohyaku’s foundation is R&D capabilities, and our
future growth depends on how many new agrochemicals we can launch market worldwide. In addition to in-housedeveloped products, opportunities to introduce chemical compounds discovered by other companies will likely
increase, and projects led by overseas subsidiaries will also increase. While such proactive initiatives are required,risk management is also important. In addition to the ability to create new agrochemicals, it is necessary to balance
the comprehensive strengths of the entire Group, such as contracts and introduction evaluations.
There are many things that listed companies must undertake, including CSR and SDGs initiatives. Currently,
the Nihon Nohyaku Group has a good governance structure in place. But, it is fragile. Along with risk management
for the entire Group, we must also respect the diversity of our employees. Even as the business environment is
expected to change more and more, I will fulfill my responsibilities as an Outside Director from a broad perspective
so that the Nihon Nohyaku Group may achieve its global growth strategy while maintaining its base in Japan.

CSR REPORT 2022

26

Expansion of Compliance and Risk Management
ComplianceApproach to and Promotion System for Compliance
Compliance at Nihon Nohyaku includes not only complying with laws and regulations, internal regulations andcontracts, but also prohibiting unethical behavior that is not socially acceptable under high ethical standards. We haveestablished Compliance Committee as a concrete promotion system for realizing this philosophy. The Compliance
Committee consists of Executive Officers or full-time Directors from each department, and the administrative office isoperated by General Affairs & Legal Department. In addition, we have appointed Compliance Promotion Supervisors andCompliance Promotion Managers in each department and office. Compliance Promotion Supervisors formulate policies
and provide guidance to ensure thorough compliance in their departments and Compliance Promotion Managers provide
practical support to further promote and comply with compliance.

Compliance Initiatives
Nihon Nohyaku fulfills its corporate social responsibility by ensuring that the business activities of all employees comply
with laws and regulations, as well as internal rules and norms, and by preventing corporate scandals. We have establishedthe Group Compliance Council to ensure thorough compliance within our Group. To respond quickly and appropriately tocompliance violations, we have established an internal reporting system that allows all employees to report directly toofficers in charge of compliance and external law firms, in addition to an organization-based reporting system.

Initiatives toward Anti-Corruption
One of the Basic Principles of the Nihon Nohyaku Group states that “we commit to being a trustworthy company for
all stakeholders through our fair and vigorous business activities,” and we actively fulfill our corporate social
responsibility through sound business activities in compliance with relevant domestic and international laws andregulations. As part of the Basic Anti-Bribery Policy, we request all employees of Nihon Nohyaku and Group
companies to comply with the “Prohibition on Bribery,” “Understanding and Compliance with the Bribery Laws andRegulations and Policy for Prevention of Bribery,” “Appropriate Approval Procedures and Ex-post Facto Confirmation
Procedures,” “Building of Sound Business Relationship,” “Regular Risk Assessment, Review and Improvement,”“Thorough Records Management” and “Prompt Report.”

Global Expansion and Management
Nihon Nohyaku conducts lively discussions through the Group Compliance Council and provides useful advice sothat overseas Group companies may fully respond to local social issues based on compliance with local laws andregulations and corporate ethics. This includes verifying whether overseas Group companies and their suppliers/
contractors are having a negative impact on the local environment and society (for example: monitoring and guidance
to ensure that our products are not used in inappropriate ways by customers, and confirmation with Group companies
to ensure that inappropriate gifts etc. are not given between private companies other than public officials), andconsidering appropriate measures that go beyond laws and regulations.

Risk Management
Approach to and Promotion System for Risk Management
Recognizing that risk management is an important part of management, we take appropriate measures to prevent
potential risks in our business activities and strive to prevent losses caused by materialization of risks as much as
possible, and in doing so, we aim to achieve the Nihon Nohyaku Group’s management plan.
Nihon Nohyaku has established a basic policy and management system for risk management for the entire Group in
the “Risk Management Regulations,” and has established the Risk Management Committee, composed of full-time
Directors and Executive Officers who supervise each department, to identify risks, prevent risks from materializing, andtake measures to minimize the impact of risks that have materialized.

27

CSR REPORT 2022

Expansion of Compliance and Risk Management

Risk Management Initiatives
We hold a regular committee meeting in March every year to summarize the activities of the year and determine policies
for the next year, and based on this, we hold workplace meetings (twice a year) and a group council within Group companies(once a year).
At the first workplace meeting in FY2021, we disseminated information on management risks and company-wide risks to improve
the risk management awareness of each employee. The second meeting was held for updating the risk list of each workplace. As aresult of discussions at each workplace, we identified new risks unique to the COVID-19 pandemic, such as the risk of long working
hours due to an increase in online meetings with overseas partners, the risk of loss of procurement and sales opportunities due tosoaring costs of goods and logistics, and the risk of information leaks due to frequent use of digital technology.
We plan to work on risk management activities that comply with management systems represented by ISO31000.

Enhancing BCP (in Japan: an earthquake directly hitting Tokyo, natural disasters, infectious diseases)
We have established the Nichino Group Emergency Response Regulations and organized a controlled organization in
the event of an emergency such as a disaster or infectious disease or when such an event is predicted, and have a system
in place to respond quickly and accurately to such an emergency.
In addition, we have established guidelines for large-scale disaster countermeasures at each of our major bases, and wehave prepared action standards and a business continuity plan (BCP) in the event of large-scale disasters such as anearthquake directly hitting Tokyo or natural disasters, and review them as necessary. As a measure to prevent the spread of
COVID-19, we have established an Emergency Response Committee that issues appropriate notifications to Nihon
Nohyaku and Group companies to prevent wide spread of infection based on government requests. As specific preventive
measures against the spread of infection, we have set a target of within 30% of employees coming into the office by making
the most of the working from home system, thoroughly implemented infection prevention measures during domestic
business trips, and refrained from overseas business trips in principle.

Response to TCFD*1 Recommendations
Climate change is supposed to have various effects on the global environment, including
agricultural crop production and natural ecosystems, so the effective promotion ofcountermeasures is a global task. For the Nihon Nohyaku Group, whose core business is a
global agrochemical for stable crop production, analyzing and predicting the direct, indirect or derivative and ongoing impacts ofclimate change is an important aspect of business strategy.
The Nihon Nohyaku Group announced its support for the TCFD Recommendations (February 2022), and we are proactively
disclosed information*2 regarding our long-term awareness and strategic response centered on the analysis of minimizing
management risks and maximizing business opportunities.

Strategic
direction

Major effects on the
Nihon Nohyaku Group

Social issues*1 Task Force on Climate-related Financial Disclosures *2 Please see our website (https://www.nichino.co.jp/en/csr/csr_climate.html ) for details on our response to climate change.

Global population
growthIncreasing urbanization

Progression ofclimate change
Growing demand forincreased food production

Progression ofdesertification

Collapse of food supply anddemand balance

Increasing
deforestation

Frequent occurrencesof extreme weather

Lack of water resources

Deterioration ofnatural ecosystems

Increase in pest
infestations and weeds

Decrease in farmland area
Decrease in crop yieldetc.

Restriction of disorderly
farmland expansion

Worsening food issues

Growing environmental awarenessImproving agricultural productivity is essential

Environmental measures such as decarbonization are essential

Nihon Nohyaku upholds “Global Innovator for Crop & Life” as a corporate statement, and in addition to tackle
to ensure a safe and steady food supply and to improve the quality of life for all through technical innovation,
we also contribute to the realization of a sustainable society through CSR activities.
CSR REPORT 2022

28

Company Overview and List of The Nihon Nohyaku Group Companies●Nihon Nohyaku Co., Ltd.
●Group companies (consolidated)●Non-consolidated subsidiaries
accounted for by the equity method●Group companies (non-consolidated)●Affiliated companies accounted for

2

7

23

by the equity method

31

29
25
19

3
11 17
32 12

14

5
8

4
6 13 18

21

24
30

27
22
26

1
9 10 16 20

Nihon Nohyaku Co., Ltd.
Head Officeaddress
FoundedCapital15
28

as of March 31, 2022

19-8 Kyobashi 1-Chome, Chuo-ku,
Tokyo 104-8386
November 17, 1928
14,939 million yen

Number of employees 1,536(consolidated)
Main business
Manufacture, import, export, andsale of a variety of products including
agrochemicals, pharmaceuticals,
animal health products, industrial
chemicals, wood preservatives, andagricultural materials

Head officeand branches

1 Head office, Tokyo Branch (Chuo-ku, Tokyo)
2 Sapporo Branch (Sapporo-shi, Hokkaido)
3 Sendai Branch (Sendai-shi, Miyagi)
4 West Japan Branch

Tokai-Hokuriku Sales Office (Osaka-shi, Osaka)
Osaka Sales Office (Osaka-shi, Osaka)
5 West Japan Branch
Fukuoka Sales Office (Fukuoka-shi, Fukuoka)
8 Osaka Office (Osaka-shi, Osaka)
6 Research Center (Kawachinagano-shi, Osaka)
Research
7 Naganuma Nursery (Yubari-gun, Hokkaido)
Facilities
Manufacturing plant 10 Nichino Service Co., Ltd.
(contracted)( 11 Fukushima Plant / 12 Kashima Plant / 14 Saga Plant)

Consolidated Group Companies
9 Nichino Ryokka Co., Ltd.
10 Nichino Service Co., Ltd.
11 Fukushima Plant
12 Kashima Plant

13 Kawachinagano Center
14 Saga Plant

15 Nichino America, Inc.

16 Nihon Ecotech Co., Ltd.

17 Fukushima Analytical Technology Center

18 Osaka Analytical Technology Center

19 Taiwan Nihon Nohyaku Co., Ltd.

20 AgriMart Corporation

21 Nichino India Pvt. Ltd.
22 Sipcam Nichino Brasil S.A.
23 Nichino Europe Co., Ltd.

Sales of chemicals/pesticides for golf courses, home & garden,
and greenification, sales of turf and turf-related materials,
planning and construction of gardens and amenity areas
Manufacturing and sales of agrochemicals, contracted
manufacturing, storage and transport of agrochemicals,
cultivation and management of fields and real estate
management

Chuo-ku, Tokyo

Chuo-ku, Tokyo
Nihonmatsu-shi, Fukushima
Kamisu-shi, Ibaraki
Kawachinagano-shi, Osaka
Miyaki-gun, Saga
Agrochemical sales, promotion, development, and registration in the USA U.S.A. / Wilmington
Agrochemical residue analysis, chemical substance safety
Chuo-ku, Tokyo
testing, and related activities
Nihonmatsu-shi, Fukushima
Kawachinagano-shi, Osaka
Agrochemical sales and promotion in Taiwan
Taiwan / Taipei
Sales of termite control agents/devices and pest control agents/devices Chuo-ku, Tokyo
Agrochemical sales, manufacturing, development, promotion, India / Hyderabad
import and export in India
Agrochemical sales and manufacturing in Brazil
Brazil / Uberaba
Agrochemical sales, promotion, development, and registration in Europe UK / Cambridge

Non-consolidated Subsidiary Accounted for by the Equity Method
24 Nichino Vietnam Co., Ltd.

Agrochemical sales, development, promotion, import and export in Vietnam

Vietnam / Ho Chi Minh

Agrochemical sales and promotion in China
Agrochemical development and registration in Brazil
Agrochemical sales, development, promotion, import and exportin the Andes and Central America
Agrochemical sales, promotion, development, and registration in Mexico
Agrochemical sales, promotion, development, and registration in South Korea

China / Shanghai
Brazil / Sao PauloColombia / Bogota

Non-consolidated Companies
25 Nichino Shanghai Co., Ltd.

26 Nichino do Brasil Agroquímicos Ltda.
27 Nihon Nohyaku Andica S.A.S.

28 Nichino México S. de R.L. de C.V.
29 Nichino Korea Co., Ltd.

Mexico / Mexico City
South Korea / Seoul

Affiliated Companies Accounted for by the Equity Method
30 Agricultural Chemicals (Malaysia) Sdn. Bhd.
31 Sipcam Europe S.p.A.

32 Tama Kagaku Kogyo Co., Ltd.

29

CSR REPORT 2022

Agrochemical sales and manufacturing in Malaysia
Agrochemical sales and manufacturing in Europe
Contract manufacturing of technicals and raw materials for
agrochemicals, pharmaceuticals and functional materials, etc.

Malaysia / Penang
Italy / Milan
Yashio-shi, Saitama

Third-Party Opinion
It can be said that the Nihon Nohyaku Group’s CSR and sustainability
initiatives have entered the stage of identifying priority issues (materiality)
and making strategic progress, mainly based on Responsible Care
activities. Going forward, I hope to see the promotion of more companywide initiatives that will lead to further improvement in corporate value.

Points that can be highly commended○
One point that can be commended is the implementation of comprehensive

initiatives and disclosure. Strengthening the CSR promotion organization isextremely important, and I can commend the fact that it is making steadyprogress. I look forward to seeing the continued enhancement of thefunctions of the promotion organization in line with changes in society. In
addition, Nihon Nohyaku states that their “business activities themselvescorrespond to the practice of CSR,” and I highly commend them for seeking
responses to SDGs through business activities focused on the opportunityside of sustainability.
The originality of the commitment of top management is also commendable.
The message includes references to the president’s career and personal
anecdotes, making it easier for third parties to understand who the top
person is and help them understand the company. While there are many top
messages with content that anyone can say, I look forward to seeing themessages that express “uniqueness” also in the future.

Points to be improved upon going forward○
One area that could be improved upon is the amount of information.

Mitsunobu Ando

Representative Director, Associationfor Sustainability Communication.
He specializes in sustainability
management and ESG information
disclosure. With the mission of“updating sustainability in Japan,”he provides sustainability
management support mainly for
listed companies. He is the author of“Future Business Illustrated SX &SDGs” (MdN), “Emergent
Responsible Management” (Nikkei
Publishing) and many others.

Although the outline of the Nihon Nohyaku as a company can beunderstood with the current amount of information, there was not enough information to gain deeper
understanding and empathy. Just a large amount is not always necessary, but comprehensive information
disclosure on sustainability is essential for readers to better understand Nihon Nohyaku. In particular, I am
concerned about the small amount of information on S (society), which has many priority issues. Disclosure
on human resources and human capital is becoming globally mandatory, and enhancement of further
information dissemination, including data sheets, will become necessary going forward.
In addition, the medium-term management plan from FY2021 discusses “Sustainable growth in corporate
value,” but I was unable to read the details in this report. It is difficult to understand the consistency between
the medium-term management plan, i.e. the management strategy and the sustainability strategy, and it isalso difficult to fully understand the uniqueness of the Nihon Nohyaku Group and its initiatives. If it is notincluded in the report, readers could understand better if measures such as directing them to the website aretaken. In the future, it would be advisable to disclose the “value creation process,” which describes how the
management strategy and sustainability strategy are integrated into concrete measures centered on
improving corporate value.
As one of Japan’s leading agrochemical manufacturers, I strongly hope that Nihon Nohyaku will disclose
information that focuses more on corporate value going forward.

In Response to the Third-Party Opinion
We would like to express our sincere gratitude to Mr. Ando for his evaluation and opinion. Nihon Nohyaku
has eventually established a CSR promotion system, and we are repeating trial and error. When creating
this CSR report, we changed the structure of the report, which had been close to an RC report, to focus
more on CSR priority issues. We will continue to improve our disclosure of information, focusing on the
points indicated by Mr. Ando, and increase transparency to all stakeholders without compromising the Nihon
Nohyaku Group’s “uniqueness.”

Hideo Yamamoto, Director, Managing Executive Officer, Nihon Nohyaku Co., Ltd.

Third-Party Verification
The CSR Report 2021 issued last year was verified by Japan Chemical Industry Association (JCIA) in accordance with the
mid-term target of the Nichino Group Responsible Care program (FY2020 to FY2024) (August 2021). The verification included
confirmation of the reasonableness of the methods of calculation and aggregation of the performance indicators (numericalvalues) listed in this report as well as the accuracy of reported information other than the numerical values in the report.
CSR REPORT 2022

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Head Office19-8, Kyobashi 1-Chome (Kyobashi OM Bldg.),
Chuo-ku, Tokyo 104-8386, JAPANPhone+81-3-6361-1400

Websitehttps://www.nichino.co.jp/en/index.html

We practice Green Purchasing.

Nihon Nohyaku received a
Development Bank of Japanloan based on the DBJ
Environmentally Rated Loan
Program, and has been rated
as “a company with advanced
environmental initiatives”.