Tokuyama CSR Report 2009

Chemistry with a heart

Responsible Care Management Dept.,
Corporate Social Responsibility Div.
Shibuya Konno Bldg., 3-1, Shibuya 3-chome
Shibuya-ku, Tokyo 150-8383 Japan
Tel: +81 3-3499-8478 Fax: +81 3-3499-8961
URL: http://www.tokuyama.co.jp/

CSR Report2009

In Harmony with People,
Society and the Environment

Staying with you all the time

Mixed Sources
Product group from well-managed
forests and other controlled sources

This report is printed on FSC-accredited paper with pure plant oil ink, which contains
no volatile organic compounds and in a dry printing process that uses no water,thus precluding release of any harmful effluents.

Corporate Social Responsibility Report 2009

Contents
1 Code of Business Activities
3 Top Message
5 A Dishonesty Problem Concerning Plastic
Window Sashes (fireproof /fire-resistant grade)
7 Summary of Business9 In Your Everyday Life - Chemistry in harmony with Society
11 Special Feature 1

The Tokuyama Group has adopted a Code of Business Activities.

Tokuyama Group Code of Business Activities

Established : May 12, 2009

All Tokuyama Group members will commit to operating in a way that is compatible with society
and to fulfilling the Group’s corporate social responsibility, following the principles bellow andendeavoring to achieve sustained growth by earning the support of our clients.

Tokuyama’s High-Purity Polycrystalline Silicon Backs theWidespread Use of Solar Cells.

❶ Compliance

13 Special Feature 2

We act with good corporate ethics and common sense, based on the understanding thatcompliance with laws and corporate rules is the most important requirement in pursuing any
kind of business.

Integration in the Tokuyama Factory: Toward Building a
Sustainable Society.

15 Special Feature 3❷ Fair Business Activities

Tokuyama Chemicals – The Group’s First Full-Scale Chemical
Plant Outside Japan● We aim to be moderate and reasonable in our business through fair, free, and transparent
competition.
● We will maintain fair and reasonable relation with political and governmental organizations.

Tokuyama’s CSR Activities❸ Responsible Care

● We develop, produce and supply products and services that have value to the community,with a constant focus on safety requirements, so that we can satisfy our clients and consumers
and earn their trust.
● We voluntarily and proactively address environmental issues based on an understanding of
their significance to all mankind and their importance to the continuation of business activities.

17 What Are Tokuyama’s CSR Activities?
19 The Foundation of CSR – Being a Trusted Company
22 RC Promotion Structure and Operation ofManagement Systems❹ Respect of Human Rights and Personality● We respect the basic rights of people in our business and will do not discriminate on the basesof race, sexuality, creed, nationality or religion.
● We value diversity in the workplace and will provide a safe and comfortable working
atmosphere to provide satisfaction and opportunity to each employee.

Harmony with Society❺ Communications

We make fair and positive public disclosure of information about our Group including its
business activities and financial reports to maintain good communication with society.

❻ Social Contributions● We actively seek to contribute to our community as a good corporate citizen.
● We contribute to the development of local regions in our international business activities,
respecting not only international rules, local laws and regulations but also local cultures andcustoms.

❼ Exclusion of Antisocial Forces

We will not enter into any business arrangement with antisocial forces that threaten public orderand safety.

Responsibility of Senior Management Under the Tokuyama Group Code ofBusiness Activities (“Code of Business”)
Established : May 12, 2009
Each member of the senior management of Tokuyama Corporation and its Group companies is
responsible for embodying the spirit of Code of Business, and specifically for carrying out thefollowing jointly and individually.

Editorial Policy
CSR Report 2009 has been prepared with the aim of bringing
Tokuyama’s activities directed at meeting its Corporate Social
Responsibility in fiscal 2008 to the attention of all concerned,
including shareholders, investors, trading partners, employees
and their families, people living near its production sites andmembers of the public.
As with the 2008 edition, Ms. Eriko Nashioka of the Institutefor Environmental Management Accounting was asked to offer
independent comments on this report. The purpose of the
independent comments is to continuously seek feedback andratings that are helpful to Tokuyama’s efforts in fulfilling its
social responsibility. Details of Ms. Nashioka’s comments areavailable on page 49.
CSR Report 2009 has been prepared based on theEnvironmental Reporting Guidelines (Fiscal 2007 edition)
published by the Ministry of the Environment.
CSR Report 2009 is also available via Tokuyama’s website:
http://www.tokuyama.co.jp/❶ Senior managers shall lead employees in complying with the Code of Business.
❷ Senior managers shall ensure that all employees in their organization comply

with the Code of Business.

❸ Senior managers shall establish appropriate internal systems to ensure thatcompliance with the Code of Business operates effectively.
❹ Senior managers shall take the following actions in dealing with any event that is
not in compliance with the Code of Business (“Violation”)
Demonstrate a clear commitment to solving the Violation.
Make every reasonable effort to identify the cause(s) of the Violation and put in place appropriate
measures to prevent any recurrence.
Make public disclosure of the Violation quickly and accurately and with appropriate accountability.
Clarify authority and responsibility with respect to the Violation and take strict action (disciplinary
measures), including appropriate action against senior managers themselves.

Tokuyama CSR Report 2009

Relationships with Customers
Relationships with Communities and Society
Relationships with Shareholders
Relationships with Trading Partners
Relationships with Employees
Process Safety, Disaster Prevention andOccupational Health and Safety

Harmony with the Environment
37
38
39
41
42
43

Performance for Fiscal 2008
Environmental Accounting
Commitment to the Prevention of Global Warming
Reduction of Air and Water Pollutants
Waste Reduction and Recycling
Development of Environmentally Friendly Products
and Environmental Technologies

Scope of the Report
Period:All performance data are for fiscal 2008, from
April 2008 to March 2009. Activities are for fiscal
2008 in general, with some for fiscal 2009.

Companies: Tokuyama Corporation (Environmental
performance data relate to the Tokuyama factory
and the Kashima factory.) Part of the performancedata also includes the total value of eleven main
production companies in the Group (See page 47).
Region:Activities in Japan (Including some overseas
companies in the Group)

Date of issue : November 30, 2009 (The next edition will be
issued in November 2010.)

1

25
28
31
32
33
35

Site Report
45 Tokuyama Factory
46 Kashima Factory
47 Activities of Group Companies
49 Comments from Third Parties
50 History of Tokuyama’s RC Activities
Editor’s Notes
Tokuyama CSR Report 20092

Top Message

Consistently striving to regain trustand evolve into a manufacturing company
that is in harmony with society
The Tokuyama Group has set out its Centennial

fireproof/fire-resistant specifications. We made anoperating with the aspiration to remain trusted

founding in 2018. The Vision defines theannouncement about this matter in January 2009.

and respected by society, this incident has

optimum form of the Tokuyama Group as “aSpecifically, three facts became known. First, test

severely damaged social faith in us. I take thismanufacturing company that creates a brighter

products with specifications differing from thoseopportunity to offer my sincerest apology to our

future with the vitality of human resources andauthorized were used to obtain individual

customers and to all our stakeholders for a great

creativity of chemistry in harmony with society.”authorization of fireproof/fire-resistantdeal of trouble and anxiety we have caused.

The principle central to the vision is to attain thisspecifications for the plastic window sashes.

Group ideal by strengthening its international

Second, plastic window sashes with

us to take steps to change attitudes within thecompetitiveness and by strengthening

specifications differing from the authorizedGroup, along with the organization and thestrategically growing businesses through humanspecifications were produced and sold. And third,

internal whistle-blowing system, with a firm

resources-based management and the promotion

approximately 70,000 window frames failing toresolve to prevent any recurrence and rebuild theof CSR activities.

meet the requirements for individual

trust that has been lost. Taking this incident mostauthorization on fireproof/fire-resistantseriously, the Tokuyama Group will engage in a

specifications have been delivered to customers.

major effort to repair and improve the sashes inunder the Centennial Vision to become a

In response to these facts, we immediately

question and to carry out the thorough reforms“manufacturing company in harmony withbegan action to identify houses or buildings

needed to ensure that incidents of this kind aresociety,” and to seek their understanding.

equipped with the sashes and to carry out

never repeated. It is my belief that if weDuring fiscal 2008, the Tokuyama Group

replacement of or repairs to the said products.

consistently strive to recover trust, we will be able

continued to pursue its vision of becoming a

These actions are presently in full swing. At theto proceed toward our vision of becoming a

manufacturing company in harmony with society.

same time, we have set up an external

manufacturing company in harmony with society.

To our deepest regret, however, a major problem

investigative committee and a recurrenceThis report comprehensively covers our actions

that betrayed the trust of society surfaced during

prevention committee to probe the causes of theto win back trust and to achieve our vision.

the fiscal year. It was revealed that Tokuyama

incident and to study ways to ensure that it does

We invite readers to provide us with their

Corporation and one of its subsidiaries, Excel

not happen again. We are faithfully and steadily

feedback and remarks in relation to this report.

Shanon Corporation, sold plastic window sashes

introducing meaningful measures based on the(fireproof/fire-resistant grade) with specifications

reports provided by these two committees.

stakeholders of the Tokuyama Group’s activities

President

3

Tokuyama CSR Report 2009

Although the Tokuyama Group has been

Vision, ahead of the 100th anniversary of its

This report has been prepared to inform our

Kazuhisa Kogo

that differed from the individually authorized

The external investigative committee advised

July 2009

Tokuyama CSR Report 20094

A Dishonesty Problem Concerning
Plastic Window Sashes (fireproof/fire-resistant grade)
It was revealed that Tokuyama Corporation and Excel Shanon Corporation (hereinafter referred to as<Incident background and causes>
With respect to the causes of the incident and its background, the external investigative committee made three points. The“Shanon”), one of Tokuyama’s subsidiaries, obtained individual authorization for fireproof/fire-resistantfirst was the lack of respect for canons among Shanon’s top management. The second was the lack of respect for canonsspecifications for plastic window sashes (fireproof/fire-resistant grade) using test products that had specifications

among its development personnel. And the third was the inappropriateness of the internal organization. At Shanon, both thethat were different from the specifications of the products that received the authorization, and that thecompanies then produced and sold plastic window sashes with specifications that did not match the said
individually authorized specifications. This incident, announced in January 2009, caused a great deal of trouble

management team and the development team were ignorant of the objectives and purposes of laws and regulations. In
addition, the quality assurance system for plastic window sashes (fireproof/fire-resistant grade) was so underdeveloped thatthe dishonest acts passed unnoticed.
To identify the reasons for the long-term failure to discover this incident, the external investigative committee pointed out

and anxiety to our customers, government authorities, and other stakeholders. It betrayed the trust of thosethe inappropriateness of the internal organization and the relationship between Tokuyama and Shanon. Within Shanon, there

working to broaden the use of plastic window sashes, which offer excellent thermal insulation and contribute to

was a barrier between the development team and the manufacturing and sales personnel. This hampered external checks on

the fight against global warming. We take this opportunity to again sincerely apologize, and to report here on thethe acquisition of the authorization with the use of the dishonest test products and on the disparity between the authorized

incident, the causes identified by the investigation, and the actions we are taking to ensure it is never repeated.

specifications and the specifications of the products sold. Meanwhile, Tokuyama, the parent company, and Shanon, a<Investigation into the causes and consideration of measures to prevent a recurrence>
When the incident was revealed, an external investigative committee and a recurrence prevention committee were set up to
study the causes and to consider ways to prevent a recurrence. Chaired by Mr. Kozo Fujita, the external investigative committee

subsidiary of Tokuyama, attached importance to sustaining and expanding the business. The Tokuyama Group’s governancedid not function effectively.

<Measures to prevent a recurrence>
The external investigative committee recommended the three reforms detailed below to prevent any recurrence of thealso consisted of Mr. Chiharu Saiguchi and Mr. Yukio Machida. All members are attorneys. The recurrence prevention

incident. Following this recommendation, a meeting of Tokuyama’s Board of Directors in March 2009 resolved to adopt

committee was chaired by Tokuyama’s President Kazuhisa Kogo. After receiving reports from these committees, Tokuyama’s

specific measures. The Tokuyama Group is now united in its efforts to steadily and faithfully implement these measures.

Board of Directors adopted measures to prevent a recurrence, based on the findings of the investigation, in March 2009.

<History of plastic window sash business and facts of the incident>
The following describes the history and facts of the incident, as uncovered by the external investigative committee throughan investigation and other efforts. Tokuyama built a factory at Kuriyama-cho in Hokkaido in December 1980 to launch theplastic window sash business, becoming Japan’s first manufacturer of such sashes. This business was operated mainly by the
Shanon & Building Materials Business Division inside Tokuyama until it was spun off and integrated in 2000. It has been
revealed that products with different specifications from the specifications authorized were sold at that time. The reason for
doing this was because mass production in compliance with the authorized specifications would have required a lot of time
and work in the manufacturing process and would have caused failure in opening and closing the windows.
In April 2004, the plastic window sash operations in Tokuyama and other group firms were unified under Shanon. After
this integration, a policy to expand sales in Tokyo, Osaka, Fukuoka and other major urban areas was launched as a means ofincreasing our market share of the plastic window sashes in the window sash market and thereby moving the business out of(1) Reforming attitudes
The recommendation on reforms to attitudes advises that the management executives must understand laws andcorporate ethics as well as the spirit behind them, to thoroughly instill them within the Company by setting out a clear
direction to be followed by the organization and its employees, and to make continuing efforts to make compliancemanagement part of the corporate culture.
In accordance with this recommendation, we are working to upgrade the compliance system and take othermeasures to prevent a recurrence to spread awareness of compliance throughout the Tokuyama Group and to make itpart of our corporate culture.

(2) Reforming the organization
For organizational reform, the recommendation advises that Shanon’s development, manufacturing, sales, and otherindividual sections, as well as its management team, must review the roles they play in the entire Tokuyama Group
from a broad perspective that goes beyond their own organizations and positions. It then advises that they take actions
to ensure that the organization that is reorganized operates in a truly organic way.
In answer to this recommendation, Shanon set up a Quality Assurance Department. It is also restructuring its

the red. In these areas, many districts are so densely packed with residential houses that they are designated as fire protection

management systems to ensure that all relevant teams including those for development, manufacturing, and sales are

districts. Acquisition of individual authorization of fireproof/fire-resistant specifications was considered essential. For these

involved in every stage of the process ranging from the start of development to manufacturing and sales.

reasons, instructions to develop plastic window sashes (fireproof/fire-resistant grade) were issued. At that time, a dishonest act

On a Group-wide basis, efforts to improve initial training for newly-appointed officers of Group companies are underway.

of modifying the structure of the test products was conducted for the purpose of passing the authorization test, since it was
felt that it would be difficult, both in technical and cost terms, to develop any plastic window sash (fireproof/fire-resistantgrade) that could compete with the aluminum window sashes that had already obtained general authorization.
Subsequently, in November 2007, the Ministry of Land, Infrastructure, Transport and Tourism carried out an inquiry into
whether authorization was obtained using any illegal test product and whether any product with specifications that differedfrom the authorized ones was sold, as part of its fact-finding study on authorization of fireproof/fire-resistant structures andtechnologies. In answer to this inquiry, Shanon made the false response that there was no problem, as it felt that if the facts(3) Reforming the internal whistle-blowing system
With respect to the reforms to the internal whistle-blowing system, the recommendation says: “Other companies’
scandals also teach us that it is of increasing importance to remove any potential source of problems at an early stage
with the help of the internal whistle-blowing system. It is necessary to periodically make all employees fully aware thatthe internal whistle-blowing system is beneficial to maintaining and increasing corporate value.”In accordance with this recommendation, an external contact for whistle-blowers has been added. Action isunderway to make the internal whistle-blowing system better known within the Tokuyama Group, including the facts that
information may be given anonymously and that the information offered is closely supervised.

were made public it would incur such a heavy burden of repair and improvement costs that it would not be able to continue
operations.

5

Tokuyama CSR Report 2009

Tokuyama CSR Report 20096

Summaryof BusinessBusiness Segments and Major Products (including group companies)

Tokuyama’s Global Network* For products, see also pages 9 and 10.

Chemicals

Germany
FranceCaustic soda, soda ash, calcium chloride, vinyl chloride monomer,Italypolyvinyl chloride resin, propylene oxide, isopropyl alcohol, methylene
chloride, biaxial-oriented polypropylene films, co-extrusion multi-layer

USA

South Korea JapanChina

films, cast polypropylene films, microporous films, layered sodium disilicate
Taiwan[Principal Domestic Group Companies]
Thailand●Shin Dai-ichi Vinyl Corporation ●Sun·Tox Co., Ltd.
●Sun Arrow Chemical Co., Ltd. ●Tokuyama Siltech Co., Ltd.

Singapore[China] ● Tokuyama Trading (Shanghai) Co., Ltd.
[Germany] ● Tokuyama Europe GmbH
[United States] ● Tokuyama America Inc.
● Tokuyama Dental Deutschland GmbH
● Shanghai Tokuyama Plastics Co., Ltd.
● Figaro USA, Inc.
<Sale of dental materials and equipment><Manufacture and sale of microporous films><Sale of gas sensors and applied products>● Tianjin Figaro Electronic Co., Ltd.
[France] ● Eurodia Industrie S.A.
[South Korea]● Tokuyama Korea Co., Ltd.
<Manufacture and sale of gas sensors and<Design, manufacturing and sale of● Hantok Chemicals Co., Ltd.
applied products>
electrodialyzers>● Tokuyama Chemicals (Zhejiang) Co., Ltd.
<Manufacture and sale of photoresist[Italy] ● Tokuyama Dental Italy S.r.l.
<Manufacture and sale of fumed silica>
developer><Sale of dental materials and equipment>● Tokuyama Electronic Materials (Suzhou) Co., Ltd.
[Thailand]● Tokuyama Siam Silica Co., Ltd.
<Manufacture and sale of high-purity chemicals<Manufacture and sale of precipitated silica>
for electronics manufacturing>Specialty Products
Polycrystalline silicon, precipitated silica, fumed silica, aluminum nitride,
dental materials and equipment, pharmaceutical ingredients andintermediates, plastic lens materials for glasses, ion-exchange membranes
and systems, metal washing solvents, high-purity chemicals for electronics
manufacturing, clinical analyzers and systems, gas sensors and gas detectors[Taiwan] ● Taiwan Tokuyama Corporation<Manufacture and sale of high-purity chemicals
for electronics manufacturing>[Principal Domestic Group Companies]●A&T Corporation ●Figaro Engineering Inc. ●Tokuyama Dental Corporation●ASTOM Corporation[Singapore]● Tokuyama Electronic Chemicals Pte. Ltd.
<Manufacture of high-purity chemicals
for electronics manufacturing>● Tokuyama Asia Pacific Pte. Ltd.

Cement, Building Materials and Others
Ordinary Portland cement, high early-strength Portland cement, Portland
blast furnace slag cement, ready-mixed concrete, plastic window sashes,
cement-type stabilizer, waste treatment[Principal Domestic Group Companies]●Tokuyama Tsusho Trading Co., Ltd. ●Excel Shanon Corporation●Tokuyama Ready Mixed Concrete Co., Ltd. ●Tokuyama Mtech Corporation

Company Outline

Sales Breakdown by Segment

Sales by Region

Number of Employees

Operating Income

Net Sales(Fiscal 2008)(Fiscal 2008)

Corporate Name: Tokuyama Corporation
Established:

February 16, 1918

Capital:29,975 million yen (as of March 31, 2009)

Registeredaddress:

1-1, Mikage-cho, Shunan-shi,
Yamaguchi, Japan

Head office:Shibuya Konno Bldg. 3-1, Shibuya 3-chome
Shibuya-ku, Tokyo, Japan

Cement, building
materials and others

Chemicals

112.6(37.4%)

85.4(28.4%)

Branchesand offices:

Sendai, Nagoya, Osaka, Takamatsu,
Hiroshima and Fukuoka

Production andResearch Sites:

Tokuyama Factory, Kashima Factory and
Tsukuba Research Laboratory

Number of Consolidated Subsidiaries:

46

Number of Equity-Method Companies:

11

300.9

(34.2%)

292.7

300

150

(billion yen)

Consolidated
307.4

300.9

263.3

155.4

171.1

(billion yen)

192.6

206.1

202.6

Consolidated (persons)
6,000

Non-consolidated

40

5,000
27.3

285
28.5

24.3
243

25
20

22.3 22.7

10

50

5

0

0

2004

2005

2006

2007

2008
(Fiscal year)

4,614

4,630

4,852

Consolidated
5,057

2005

2006

2007

2008
(Fiscal year)* Europe andNorth America(14.1%)
Total

2,028

2,004

2,067

2,127

0

300.9

2,161

billion yen

Japan

1,000

2004

17.2 (5.7%)

42.3

5,295*

4,000

2,000

10.2

Other*

Asia

3,000

18.1 17.0

15100

Non-consolidated

35.3

34.7

35
30

237.5

200

billion yen

102.8

Non-consolidated

350

250

Total

Specialty
Products(billion yen)

241.3
2004

2005

2006

2007

2008
(Fiscal year)(80.2%)(billion yen)

* Including 581 overseas employees in fiscal 20087

Tokuyama CSR Report 2009

Tokuyama CSR Report 20098

In Your Everyday Life - Chemistry in harmony with Society

Cement and concrete

Tokuyama has devoted itself diligently to manufacturing in an effort to serve society and to bring happiness tolife help you in your daily life. If you notice our products, you will find that Tokuyama is always beside you.
Medical gloves (polyvinyl chloride resin)
Intravenous bags (polyvinyl chloride resin)●Pharmaceutical products (pharmaceutical●

Tires (precipitated silica)
TOKUSIL (silica powder), also
called white carbon, is chiefly
used as a reinforcing and fillingmaterial for synthetic rubber.
When used in tires as areinforcing agent, it improves
gripping performance to shorten
braking distances. Reducing
rolling resistance, it also has theeffect of reducing fuelconsumption.

●

ingredients and sodium bicarbonate)

Blood testing (diagnostic reagents, clinical●analyzers, and laboratory information systems)

Dental materials and equipment●

H O S P I TA L

Building exterior●(building materials and polyvinyl chloride resin)

Window glass (soda ash)●

Paint (isopropyl alcohol and precipitated silica)●

Aluminum wheels (caustic soda)●Car navigation systems●(aluminum nitride, polycrystalline silicon,
high-purity chemicals for electronics
manufacturing, photoresist developer andsilica for semiconductor encapsulant)

Glasses●(plastic lens materials for glasses)

Shampoo (isopropyl alcohol)
Bathtubs (propylene oxide)●Water pipes (polyvinyl chloride resin)●Bath salts (sodium bicarbonate)●

Cellular phones (polycrystalline silicon,●●

high-purity chemicals for electronics
manufacturing, photoresist developer andsilica for semiconductor encapsulant)

Sports shoes (precipitated silica)●

Hybrid cars (aluminum nitride)●

LCD televisions (aluminum nitride, polycrystalline

Personal computers(aluminum nitride, polycrystalline silicon,
high-purity chemicals for electronics
manufacturing, photoresist developer and silica
for semiconductor encapsulant)

Food wrapping film
(polypropylene film)
Polypropylene films offer excellent transparency
and strength, and are highly suitable to automatic wrapping,
printing, and processing into bags. With advantages in theirresistance to chemicals and heat based on the characteristics
of polypropylene, they are widely used in food wrapping,
and wrapping for clothing and textile, as well as in manyother applications.

(polycrystalline silicon)

Polycrystalline silicon is used as a material for solar cells
in which silicon substrates are used.
* For details about polycrystalline silicon, see also pages
11 and 12.

Ordinary Portland cement is so versatilethat it is used in a broad array of
applications, including general civilengineering and construction works,
and cement secondary products.
Ready-mixed concrete is classified into
ordinary concrete for general works,
road paving concrete, and lightweight
concrete, which is lighter than ordinary
concrete. Ready-mixed concrete mills
provide a wide range of concreteby changing the ingredients andthe formulas.

people since its establishment. Although they may attract little attention, products that are valuable in everyday

Outsidethehome

Solar cells

Aluminum nitride is used for a number of leading-edge semiconductor
devices such as heat dissipating components for computers, insulating
substrates for the power supply units of trains in Japan and overseas,
laser diode substrates for DVD and other optical drives, and substrates
for automotive control modules in hybrid-powered and othervehicles.

●silicon, high-purity chemicals for electronics manufacturing,
photoresist developer and silica for semiconductor encapsulant)

DVD recorders (aluminum nitride)
Residential windows (plastic window sash)●

Keyboards (fumed silica)●CD/DVD drives (aluminum nitride)●Optical communications●●

Laundry detergent●(layered sodium disilicate and soda ash)

Soap (caustic soda)●Toothpaste (precipitated silica)●(aluminum nitride)

Gas detectors
Low-salt soy sauce
and table salt●●

(ion exchange membrane)

Clothing (caustic soda)
Dehumidifying agent (calcium chloride and microporous film)●Interior finishing material (plaster sheet)●●

Baby diapers (microporous film)
Toys (polyvinyl chloride resin)

9Tokuyama CSR Report 2009

Newspapers (caustic soda)
Sofas (propylene oxide)●Wine (ion exchange membrane)

●

●

●

●

At
home

Tokuyama CSR Report 200910

Special Feature 1 Technologies that contribute to the fight against global warming

Tokuyama’s High-Purity Polycrystalline Silicon
Backs the Widespread Use of Solar Cells.

industry. It is a primary material for productsthat are indispensable to today’s lifestyles,
such as large scale integrated circuits (LSIs),
which are the hearts of personal computers,
electronic components for automotive control,and cell components for solar modules that

(EPIA Global Photovoltaic Outlook 2009)(MW)
16,00014,73015,00014,000EuropeJapan
USA
Rest of the world

13,00012,00011,00010,000

9,162

9,000
8,000

6,770

7,000
6,000

5,167

5,000

3,847

4,000
3,000
2,000
1,000
0

962

1,166

1,428

1998

1999

2000

1,762

2001

2,201

2002

2,795

2003

2004

2005

2006

2007

2008

product surface cleaning among other areas.
Conversion efficiency is an indicator of the percentage ofsunlight energy turned into electricity. Solar cellmanufacturers are in a fierce race to achieve higher
conversion efficiency. Characterized by its low impurities,
Tokuyama’s high-purity polycrystalline silicon satisfies
customers’ needs in this respect.
*1 Eleven-nine: Refers to a purity level of 99.999999999% for semiconductor crystals. The
percentage figure has 11 nines. This term means that the crystal has been refined to apurity level that is extremely close to 100%.

Harmony with the Environment

convert sunlight into electricity, which are

Global cumulative installed photovoltaic capacity

Harmony with Society

Polycrystalline silicon, or polysilicon, is afundamental material in the electronics

Tokuyama’s polycrystalline silicon made its debut as amaterial for electronic components. The size of theelectronic components has been reduced with each year.
Today’s small laptops boast performance superior to themainframe computers used three decades ago. This could
not have been achieved without making nine billion
transistors on a 3-cm square single-crystalline silicon
substrate, which in turn requires precision on the order of
1/10,000mm. At this tiny size, any non-silicon impurity
causes failure. The polycrystalline silicon used for this musthave eleven-nine*1 purity.
This eleven-nine requirement is met by Tokuyama’s
polycrystalline silicon, which embodies 25 years ofexperience and a constant commitment to research anddevelopment. The polycrystalline silicon produced by
Tokuyama also represents an accumulation of our unique
technologies in distillation, refining, deposition, andGraph 1Tokuyama’s CSR Activities

Polycrystalline silicon

Global cumulative installed photovoltaic capacity has
increased about tenfold, from 1,428 MW in 2000 to
14,730 MW in 2008. (See Graph 1)
Silicon-based solar cells account for approximately 90%of this capacity. The manufacturing process of silicon-basedsolar cells begins with silica stones, or silicon dioxide.
The diagram at the left page outlines the process flow.
(See Figure 1)
Solar cell technology is now so advanced that the energy
required for manufacturing solar cells can be recovered inabout one and a half years.

Special Feature

The surface of the Earth receives one kilowatt of energy per square meterfrom sunlight. If all of the sun’s energy that reaches the globe could be
converted into electricity, just one hour of sunlight would supply the energy
needs of the entire world for a year. Moreover, this energy is available
to anyone, as it is supplied uniformly to every part of this planet. Solar cells
emit no carbon dioxide at all when they produce electricity. Amid concern
about global warming and the exhaustion of fossil resources, many
governments are pursuing policies to boost the introduction of solar cells.
In Japan, the introduction of solar cells is gathering momentum under the
A new polycrystalline silicon plant, construction of which was
Fukuda Vision.
completed in March 2009 (Higashi Plant, Tokuyama Factory)

Spread of solar cells

Development of the VLD (vapor-to-liquid deposition) method

playing a central role in renewable energy.

Grid parity refers to the point at which electricity can be generated at the cost equal to the charges for theelectricity supplied by the electric power company. To approach this ultimate goal, it is necessary to ensure thatpolycrystalline silicon as a material for solar cells is produced at low cost. Tokuyama is focusing its R&D on the
VLD method, which differs from the conventional production method. The second-generation verification

Figure 1 Process flow for production of high-purity polycrystalline silicon in the Siemens method

reactor has recently been constructed. Verification tests will begin in summer 2009.

Metallic silicon material ⇒ Trichlorosilane (liquid) ⇒ Distillation and refining (for heightening purity) ⇒ Deposition reaction⇒ High-purity polycrystalline silicon rods ⇒ Processing (into fist-size pieces) ⇒ Shipping
Mountain

Since joining Tokuyama, I have been involved in developing the VLD method, a new manufacturing
approach for the polycrystalline silicon used in solar cells. The VLD method is a technology unique toTokuyama, and it enables more efficient polycrystalline silicon production compared with the conventional

Silica stones

Tokuyama’s business
Trichlorosilane
Refining

Polycrystalline silicon

Addition

method. I believe it will help lower the costs of solar cells. The path to development isSingle-crystalline siliconSingle-crystalline wafer

IC chip

challenging, but it is truly exciting to be involved in the process of creating a new technology.
The development of the VLD method is now in its final stages. We will work closely with

Boron and phosphorus

Deposition

Site Report

Metallic silicon

Voiceother sections and with customers to ensure commercialization at the earliest possible date.

Takuya Majima, Si Development Dept., Si Business Div.

Melting furnace

For semiconductor applications
Polycrystalline silicon solar cells
Single-crystalline silicon solar cells

11

Tokuyama CSR Report 2009

Growth furnace

Slicing

Solar cell

Solar module

Tokuyama CSR Report 200912

Special Feature 2

The Tokuyama Factory is located in the Shunan Petrochemical Complex
fronting the Seto Inland Sea in the southeastern part of Yamaguchi
Prefecture. It is Tokuyama’s core production base. With an area of 1.91
million square meters, it is one of the largest factories in Japan. It isequipped with great harbor infrastructure, including 22 in-house berthswith the depth of 12 meters and one 14-meter-deep public wharf.

Higashi Plant

Integration

Produces polycrystalline silicon and organic chemicals

Undersea tunnel

Special Featurein the Tokuyama Factory

JR Tokuyama Station-Toward Building a Sustainable Society-

A highly efficient energy system based on in-house power generation
At the heart of the integration in the
Tokuyama Factory is its in-house power
plant, which boasts one of the largest power
generation capacities in Japan at 552,000
generated are supplied through power lines
and pipes to the electrolysis plant and otherplants. The factory makes effective use of

Produces inorganic chemicals

Recycling operations open to society –––– Active acceptance of external waste

Sun·Tox Co., Ltd.

The Tokuyama Factory has been making exhaustive efforts torecycle by-products and waste generated from within. It has
now attained an outstanding green performance: in fiscal 2008,
it effectively utilized 94.1% of waste and achieved a zero
emission rate of 99.9%.

Tokuyama Polypropylene Co., Ltd.

steam as well as electric power to attainhigh levels of energy efficiency.

EDC

Tokuyama Siltech Co., Ltd.

Electrolysis

NaOH

Industrial
salt

Zero emission

Waste

Chloromethane

Products

Fumed silica

Postcombustion ash

ReusedLimestone

Site Report

Silica stone

Coal■ Trend in unit consumption of waste and by-products

■

420

425

430

424

300
277
200
100
0

1991

2004

2005

2006

2007

2008

2,004

2,000

2,143

2,144

70

70

(thousand metric tons)
125
2,100
1,947
100

1,550
85

1,500

82

80

75

1,000

50

500

25

0

4
1991

2004

2005

2006

2007

2008

0

Thermal recycling volume406

Trend in material and thermal recycling volumes(thousand metric tons)
2,500
Material recycling volume400

No residue
generated

Shunan Petrochemical
Complex(kilograms per metric ton of cement)
500

Tokuyama CSR Report 2009

(The figures represent actual quantities for fiscal 2008.)

CementYamaguchi Eco-tech Corporation■ The process flow for the recycling of waste and by-products in cement production

H2

Soda ash

Waste*1 Cement kiln: A rotary kiln used for sintering raw materials in the cement plant

Metallic
siliconPolycrystalline silicon

Power generation
発電所
facilities

Zero emission

13

Shin Dai-ichi Vinyl
Corporation

VCM

Chloride

Cl2

Aluminum nitride

An in-house power plant with one of the largest
power generation capacities in Japan

Mitsui Chemicals, Inc.

PO

IPA

Shunan Petrochemical
Complex

Harmony with the Environment

The cement plant is another nucleus of the integrated Tokuyama Factory. It
makes effective use of by-products from the Company’s soda ash plant and coalash from in-house power plants as raw materials. It also accepts a large amount ofwaste and by-products from outside the Company, and conducts recycling that isopen to society. A significant percentage of waste and by-products can be used as
raw materials for cement production, as they contain certain elements that are
identical to those contained in clay, one of the raw materials for cement.
Combustible waste can also be used as an energy source. The temperature in the
cement kiln*1 reaches 1,000 to 1,800 degrees Celsius. At this high temperature,
combustible elements are reduced to ash, which is used as an ingredient forcement. This makes the cement kiln quite unlike an incinerator, in that it
generates no residue. In fiscal 2008, the factory recycled 2.03 million metric tonsof waste and by-products, including 0.30 million metric tons generated within the
Company.
Committed to helping to create a recycling society, the Tokuyama Factory
continues with its steady efforts to turn itself into a more advanced production
base.

Integration in the Tokuyama Factory
Since it commenced operations in 1918, the Tokuyama Factory has constantly pursued its visionof becoming an integrated production base, where energy, materials, and technologies support close
links among different businesses. The factory has built a sophisticated integration system, in which
multiple plants for inorganic and organic chemicals, cement, electronic materials, and other products
are arrayed in a layout designed to enable them to make effective use of raw materials, products,
by-products, waste and utilities reciprocally.

Produces cement

Harmony with Society

kilowatts. The electric power and steam

Nanyo Plant

Tokuyama Plant

Tokuyama’s CSR Activities

Tokuyama’s principal production facilities can be found in the Tokuyama Factory. Equipped with one of thelargest in-house power generation facilities in Japan, this factory integrates diverse manufacturing processes
in a highly sophisticated manner. With a highly efficient production structure, it has achieved a zero emission
rate of nearly 100%. The Tokuyama Factory is fully committed to building a sustainable society, for instance by
actively accepting waste from outside the Company in its cement business.

Material recycling (into materials):
1.95 million metric tons

Thermal recycling (into fuels):
80,000 metric tons

Sludge, surplus soil, dehydrated
cakes of refuse incineration ash1),
coal ash, waste liquid, and slag

Waste plastics2) (excluding
polyvinyl chloride), heavy oil ash,discarded tires, animal residue,
wood waste, and waste liquid

1) The factory accepts incineration ash generated from municipal refuse incineration facilities in Yamaguchi Prefecture
after pretreatment by Yamaguchi Eco-tech Corporation, a joint venture of the Company and Ube Industries, Ltd.
2) A technology has been developed to enable the stable injection of crushed waste plastics in large quantities from thefront of the kiln. The crushing and combustion capacity is boosted each year to meet the growing demand to accept thewaste plastics.

Tokuyama CSR Report 200914

Special Feature 3

The instrument panel
room where the plant is
controlled

CHINA
Special Feature

Jiaxing, Zhejiang Province
Corporate Profile

Tokuyama Chemicals (Zhejiang) Co., Ltd.
Business: Manufacture and sale of fumed silica
Location: Zhapu Economic Development Zone, Jiaxing,
Zhejiang Province, PR China
Capital: 43.9 million US dollars (as of the end of March 2009)

Tokuyama Chemicals

Ownership: Tokuyama Corporation 100%

The Group’s First Full-Scale Chemical Plant Outside Japan

Number of Employees: 152 (as of the end of March 2009)

Date of Foundation: September 13, 2005

A wide variety of functionsof fumed silica❷ Reinforcement

Zhejiang Province city of Jiaxing, in the suburbs of Shanghai, to build a production facility in China’s principal consuming region.

❸ Dispersion aiding and anti-settling❹ Anti-caking and fluidity improvement❺ Anti-blocking

production capacity of 5,000 metric tons. In addition, a second-phase construction project is now underway to build an additional❻ Adsorption and absorption support

plant with a capacity of 5,000 metric tons. The project is expected to conclude at the end of August 2009, when total annual❼ Abrasion

production capacity is set to real 10,000 metric tons.

❽ Matting

Providing these functions and effects, fumed silica is used for many different applications and products.
As portrayed on page 10, it is helpful in all aspects of daily life.
●

Crystal rubber●(Sports shoe soles)●(Coated on the surface)

Unsaturated polyester(Resin for ships, bathtubs and tanks)●

Printing inks and ink-jet
printer paper

Sealant(Gap filling material for joints inwindows, doors and other buildings)●

Synthetic leather(Coated on the surface as amatting agent)exchange meeting with Tokuyama’s engineering personnel was

to Japan for safety education.

organized for technical staff. It covered a broad array of subjects,

ISO 9001 and 14001 certification

including quality and the environment. In China, the key to boosting

Silicone rubber
Paints● Adhesives● Toothpaste● Films● Fire extinguishing agents●●

Tokuyama Chemicals is preparing to obtain ISO 9001 certification

exceeded 3,000 US dollars. After per capita GDP topped 1,000 US

an employee retention rate lies in ensuring that individual employees

dollars in 2003, China then tripled its economy in just five years. As

achieve personal growth, with a recognition that they work in a place

growth. I believe that the keys to achieving sustainable

the people of China seek to enjoy better lifestyles, demand iswhere they can develop their careers.

growth in China are quality advantages, quality stability, cost

beginning to grow rapidly for fumed silica, which is used as a

Relationships with the environment and the local community

competitiveness, and speed or timing of response.

reinforcing agent for silicone rubber and fiber reinforced plastics

In the process of manufacturing its products, a chemical plant(FRPs), as a sealant for building materials, and as an anti-drip agent

generates waste. Tokuyama Chemicals has introduced flue gas exhaust

approaches manufacturing with an emphasis on quality, itsfor paints and inks, among other applications. China is set to be atreatment systems that have demonstrated an impressive track record

strongest point.

rapidly emerging market for fumed silica. We believe that our mission

for years at the Tokuyama Factory of Tokuyama Corporation. For

management operations are increasingly significant. We are currently

is to provide this market with competitive products, aiming to achieve

wastewater treatment, a new high-performance sludge separator has

working hard to obtain ISO 9001 and 14001 certification, to respond to“independence, growth and fairness,” Tokuyama Chemicals’ basic

been developed, which successfully lowers the suspended solidincreasing demands from customers. This effort helps reduce

policy, in line with China’s development. This section takes a look atconcentration in the discharged water. Currently, separated sludge isambiguities in the work flow and steadily improve the efficiency andsome of the initiatives that Tokuyama Chemicals has taken with arecycled into a brick material. We are in the process of patenting the

focus on the giant China market.

sludge separating systems. In addition to submitting reports to the

Employee education

government authorities, full explanations were offered to local residents

China continues to achieve astonishing rates of economic

With these points in mind, Tokuyama Chemicals

To maintain the growth of our business, we will continue
demands today and in the future,
and what approach we shouldtake to increase customer
satisfaction in rapidly changing
business circumstances in China.

Hiroshi Nomura
President
Tokuyama Chemicals (Zhejiang) Co., Ltd.

15

Tokuyama CSR Report 2009

A chemical plant differs from assembly plants in the mechanicalin the development zone prior to the construction of the plant.

equipment industry in that reactions and interactions among materials

Voice
Aiming to become the number one quality provider~ Obtaining ISO 9001 and 14001 certification ~Under our project to double fumed silica production, quality

Site Report

to seek accurate insights into what this giant market

in July 2009 and an ISO 14001 certification in October 2009.

transparency of operations. The number of players targeting the huge
China market is expected to rise. To compete in this tough market, wemust improve not only the competitivenessof our services and prices but also ourquality level. We will continue to take steps
to enhance our quality over the short,

are not directly visible. A number of hidden risks are therefore

It is often noted that corporate social responsibility (CSR) has

present. Line personnel receive safety education at the Skills

moved from a debate about whether a company should fulfill its CSR

Education and Training Center on the premises of Tokuyama

to the question of how to fulfill it. In China, we will steadily operate a

Corporation’s Tokuyama Factory, in addition to daily safety and health

CSR program that is modest and unobtrusive but that is closely linked

education. A total of 28 manufacturing staff members have so far

with the local community. Our CSR program includes introducing

completed the safety education program, giving them a combined

pollution control systems, as we did for our plants in Japan, engaging

total of 56 days of experience in the dangers involved. In addition, an

in dialogues with the local community, and dispatching staff members

medium, and long terms, aiming to become
the number-one quality provider.

Katsumi Nagase
General Manager of the Technical Dept.
and the Quality Assurance Dept.

Tokuyama CSR Report 2009

Harmony with the Environment

In 2008, China’s per capita GDP (gross domestic product)

The product warehouse

Harmony with Society

overseas sales to at least 30% of total sales. To reach this goal, Tokuyama Chemicals (Zhejiang) Co., Ltd. was established in theThoughts on overseas marketing of international products

REOLOSIL®

(after completion of the second phase project)❶ Thickening and thixotropy

Tokuyama Chemicals’ CSR-related activities

under the brand name of

Production Capacity: 10,000 metric tons of fumed silica a year

by quickly and appropriately responding to Chaina’s increasing demand. The Group’s Centennial Vision sets a goal of increasingThis is Tokuyama’s first full-scale factory outside Japan, and it commenced operations in November 2007 with a fumed silica

by Tokuyama Chemicals

Site Area: 150,000 m2

Tokuyama’s CSR Activities

With demand increasing rapidly in China, it is essential that the Tokuyama Group generate higher corporate value of the Group

Fumed silica manufactured

16

Tokuyama’s
CSR Activities

The Tokuyama Group strives to operate under thebasic policy, “management in harmony withsociety.” To our sincere regret, however, adishonesty problem came into light in which test
products with specifications that differed from thoseof the authorized products were used to obtain
individual authorization for fireproof/fire-resistantspecifications in the plastic window sash business.
This has severely betrayed the trust of our customers
and many other stakeholders. Compliance is aprerequisite in CSR management. We are treating
this critical breach of compliance with the utmost
seriousness, and we have adopted measures toprevent any recurrence, with an unyielding
determination to regain the confidence of our
stakeholders. I am convinced that these actions toregain trust will show us
the way forward in our
mission to become amanufacturing company
that operates in harmony
with society.

Creating value that is
helpful to life anywhere
and anytime

Basic Policy

Implementation of CSR activities
Build good relationships withvarious stakeholders

Management from a future perspective

Management with an emphasison personality●●

Aim to be a unique company
Cultivate the personalities ofindividual employees

p. 32 Relationships with Trading Partners❸ Responsible Care

●We develop, produce and supply products and services that have value to the community,with a constant focus on safety requirements, so that we can satisfy our clients andconsumers and earn their trust.
●We voluntarily and proactively address environmental issues based on an understanding of theirsignificance to all mankind and their importance to the continuation of business activities.

p. 22-24 RC Promotion Structure andOperation of Management Systems❹ Respect of Human Rights and Personality●We respect the basic rights of people in our business and will do not discriminate on thebases of race, sexuality, creed, nationality or religion.
●We value diversity in the workplace and will provide a safe and comfortable working
atmosphere to provide satisfaction and opportunity to each employee.

p. 33-34 Relationships with Employees❺ Communications

p. 31 Relationships with Shareholders

We make fair and positive public disclosure of information about our Group including its
business activities and financial reports to maintain good communication with society.

p. 28-30 Relationships with Communities
and Society

CSR foundations
Internal control (Sunflower Activities)
Corporate governance
Strengthen the compliance system
Practice the basic philosophy (action objectives) ofresponsible care (RC) and RC activities
Tokuyama Group Code of Business Activities■ Tokuyama’s Major Stakeholders
Tokuyama conducts customer-focused
quality assurance activities based on
implementation of its ISO 9001-compliant
quality management system. Chemical
substances are comprehensively managed
to ensure safety at all stages of the
manufacturing process.

Society

Customers

Relationships with
Customers (p. 25)
Tokuyama strives to improve the work
environment so that every individual
employee can exhibit their abilities andperform their duties actively and with ahigh level of motivation. In fiscal 2008,
we focused on the development of
human resources in the Skills Education
and Training Center and other facilities,
and stepped up efforts to improvemental and physical health.

Relationships with
Employees (p. 33)
Tokuyama is committed to creating
relationships of trust with all trading
partners through honest business dealings.
Tokuyama is also committed to complying
with CSR in its purchasing activities.

Tokuyama conducts environmentallyfriendly management operations with
an emphasis on the environmental
perspective in every aspect of its
business activities.

Employees

Harmony with
the Environment (p. 37)

Globalenvironment

Tokuyama

Communities
and society

Tokuyama is engaged in many different
activities directed at making acontribution to society. They include
financial support for scientificdevelopment and technology and support
for the healthy growth of children. We arealso working on communication withlocal communities by providing
opportunities for local RC dialogues.

Site Report

Take a long-term perspective● Take advantage of the risks●We aim to be moderate and reasonable in our business through fair, free, and transparent
competition.
●We will maintain fair and reasonable relation with political and governmentalorganizations.

Harmony with the Environment

Basic Philosophy

Management inspired by denial●❷ Fair Business Activities

We will not enter into any business arrangement with antisocial forces that threaten publicorder and safety.

Management in harmony with society
Overcome the stereotype andbreak free of precedents● Continue with reform every day

p. 20 Promoting Compliance❼ Exclusion of Antisocial Forces●●

We act with good corporate ethics and common sense, based on the understanding thatcompliance with laws and corporate rules is the most important requirement in pursuing
any kind of business.

●We actively seek to contribute to our community as a good corporate citizen.
●We contribute to the development of local regions in our international business activities,
respecting not only international rules, local laws and regulations but also local culturesand customs.

Managing Director
General Manager
Corporate Social Responsibility Div.

Basic Policy

Think and act from thecustomers’ standpoint● Anticipate the trend of the times❶ Compliance❻ Social Contributions

Etsuro Matsui■ Tokuyama’s CSR Approach

Management in harmony
with society

All Tokuyama Group members will commit to operating in a way that iscompatible with society and to fulfilling the Group’s corporate social
responsibility, following the principles bellow and endeavoring to achievesustained growth by earning the support of our clients.

Harmony with Society

Tokuyama approaches its CSR activities in accordance with its basic
policy of engaging in management in harmony with society. We
believe that CSR activities help give us the continuation of our businessand enable us to work with society to build a sustainable future. To
increase stakeholder satisfaction, we commit to corporate activities
that are welcomed by the society of which each stakeholder is part.
We see bolstering management transparency as a fundamental partof our CSR. We are also committed to a program of promoting soundcorporate governance and to building an internal control system and acompliance system, to ensure comprehensive risk management.
The Tokuyama Group has been pursuing an initiative which it
calls Sunflower Activities, designed to permanently instill within theGroup the essence of internal control.
Under the Tokuyama Group Code of Business Activities, we seek topractice management in harmony with society, to make the Group intoa business grouping whose members are each the enterprise of first
choice for their customers, and to build excellent relationships with all
stakeholders.

An unyielding determination to regain thetrust that has been lost

Established: May 12, 2009

Tokuyama’s CSR Activities

What Are Tokuyama’s
CSR Activities?

Tokuyama Group Code of Business Activities

Special Feature

The Tokuyama Group has a basic management policy ofpracticing management in harmony with society so as tocoexist with and achieve a shared success with society andthereby establish itself as a business grouping which istrusted by society and whose members are each theenterprise of first choice for their customers.

Message

Relationships with
Communities and Society (p. 28)
Trading
partners

Shareholders

Tokuyama offers information in a
prompt and appropriate manner to gain
the understanding and trust ofshareholders and investors.

Relationships with
Shareholders (p. 31)

Relationships with
Trading partners (p. 32)

17

Tokuyama CSR Report 2009

Tokuyama CSR Report 200918

Tokuyama’s CSR Activities

The Foundation of CSR
As a manufacturer, Tokuyama’s social mission is todevelop, manufacture, and supply society with
useful products with full consideration given to theenvironment and safety. In pursuing this mission, we
have adopted the basic policy of practicing
management in harmony with society. To follow ourbasic policy and fulfill our corporate social
responsibility, and to make the Tokuyama Group intoa business grouping whose members are each theenterprise of first choice for their customers, weunderstand that it is essential that we constantly
improve corporate governance, construct andimprove an internal control system, and develop acompliance system.

■ Corporate Governance Structure
Shareholders’ Meeting
Appointments
and dismissals

Appointments
and dismissals

Appointments
and dismissals

ReportingAccounting Auditors

Board of Directors

Decisions and supervision

Auditing

Board of Auditors
Auditors

Collaboration

Auditing

Business operations

Executive Committee
Strategy Committee
Human Resources
Committee

Instructions and the raising of awareness

Sunflower Committee

President

RC Management Dept.
Auditing Department
Internal audit

RC auditBusiness divisions, back office divisions, research laboratories, factories and group companies

19

Tokuyama CSR Report 2009

Internal control
auditing

Instructions
and the raisingof awareness

The Tokuyama Group sees the concept of compliance from a
broad perspective as encompassing the observance of both internaland social rules and, beyond simply obeying laws and regulations,common-sense behavior that conforms to corporate ethics. Aware
that compliance is an essential element of management that forms
the foundations of CSR and internal control activities, we declared
our commitment to compliance in the Tokuyama Group Code ofBusiness Activities, which serves as action guidelines for every
single officer and employee in the Group.
In the past, different group firms had separately set up behavioral norms and other rules in accordance with the Tokuyama Codeof Behavior and with the Tokuyama Behavioral Guidelines. We
have now instituted the Tokuyama Group Code of Business
Activities as common
rules for the Group to
Tokuyama Group’s Five Conscience
ensure that all officers
Clausesand employees of the
Our behavior shall:Group understand the❶ Comply with laws, regulations andspirit of compliance andinternal rules;
corporate ethics and❷ Conform to the Tokuyama Group
raise the level of their
Code of Business Activities;
compliance.
❸ Justify the trust of customers andtrading partners;
In addition, the❹ Earn the respect of society andResponsibility of Senior
general consumers; andManagement under the❺
Be of a standard that can be spoken
Tokuyama Group Codeof with pride in front of familyof Business Activities
members and coworkers.
has been produced inCompliance Promotion System
We have established a Compliance Committee headed by
the president and consisting of six directors. The Committee
makes decisions on the basic philosophy, Company policies,
structures, and organizations related to compliance and offers
proposals to the Board of Directors. To facilitate its work, theCompliance Committee has an office to conduct activities
designed to raise awareness and promote operations in
information and inquiries using the helpline, in accordancewith the Committee’s instructions.

■ Compliance Promotion System

Auditing Department

Reporting andinstructions(anonymously)

HelplineCommunication
Communication(Board of) Auditors

Compliance
Committee
Reporting andinstructions

Board of Directors

Launch and Development of the Helpline
As part of its efforts to improve the compliance system, Tokuyama
launched a helpline in 2003. The helpline has since been dealing
with information and inquiries from officers and employees within
the Group. The scope of eligibility for services was subsequently
expanded to our trading partners and to family members of ouremployees. We also set up an external contact for consultation
services offered by a lawyer. This was increased to two in August
2009, as part of our attempts to improve and expand the system.
The helpline strictly maintains the anonymity of informers andadvice seekers. The internal rules clearly stipulate that any
whistle-blower will not be subject to any disadvantageous treatment
in personnel affairs or other areas. This system has been introducedin the belief that it will help prevent violations of compliance andthat it will enable a self-correcting function to work effectively.
Distributed to all employees and officers in the Group, thehandbook of the Tokuyama Group Code of Business Activities
includes contact details for the helpline. We will continue withactivities to make this system better known to those concerned.

Tokuyama CSR Report 2009

Site ReportCompliance
Committee

Financial statement
auditing

Promoting Compliance

The handbook of theTokuyama Group Codeof Business Activities

Harmony with the Environment

Since fiscal 2006, the Tokuyama Group has been working on
an initiative titled Sunflower Activities. This is an effort tocontinually improve the internal control system and to establish
internal control within the Group. Drawing an analogy with asunflower facing the sun, the name of the initiative represents our
sincere attitude and our determination to discharge our duties.
The Sunflower Committee has been established as a body toensure that the initiative is carried out throughout the Group.
Headed by the president, it discusses and makes decisions on
basic matters that relate to internal control, and strives to create,develop, and operate the framework for ensuring that operations
are conducted appropriately. Responsible for handling practicalaspects of the initiative, the Corporate Social Responsibility
Division acts as the Sunflower Committee office. The focus of its
activities was placed on the internal control reporting system,
better known as the Japanese version of the Sarbanes-Oxley Act(or J-SOX), in fiscal 2008, the initial year of the systemapplication.
In fiscal 2009, we will not only continue with actions toward
J-SOX compliance but will also take steps throughout the Groupto build and enhance an internal control
system that ensures the appropriateness ofoperations. These steps include promoting
risk management activities that serve as thebasis of internal control and developing acompliance framework.

Harmony with Society

The corporate governance system is an essential part of
improving corporate value. We believe that we need to conduct
daily inspections and to take the necessary steps to ensure thatthe system always operates appropriately.
The Board of Directors meeting is held at least once a month
to make resolutions on basic Group policies and strategies, todiscuss and make decisions on important business matters andto supervise business operations. As of the end of June 2009,
the Board of Directors consisted of 14 directors and waschaired by the chairman. A director’s term of office is set at one
year, to allow both a focus on the duties and responsibilities ofoffices and a rapid response to changes in the businessenvironment. The Executive Committee has been set up as abody advising the president on matters to be referred to theBoard of Directors and other critical issues of management. It is
tasked with ensuring agility and efficiency in business
operations and in decision making. The Executive Committee
consists of the heads of four business divisions and thosenominated by the president from among the directors andassociate directors. At least one auditor participates in Executive
Committee meetings to comment as required. A framework forauditing the overall execution of business is thus maintained.
At present, the Board of Auditors has four members, two ofwhom are external auditors. Auditors attend meetings of theBoard of Directors and other key meetings to oversee the workof directors and ensure that it is appropriate. They also regularly
exchange information and views with the internal auditing
section and accounting auditors and work in mutual
collaboration with them to increase auditing effectiveness andefficiency.
Our internal auditing framework consists of the Auditing
Department, with five staff members. It is independent of anyline division and performs regular internal audits of thedivisions and affiliated companies in the Group.

Being a Trusted Company

written form, setting out strict rules to be followed by Tokuyama’s
management executives and counterparts in its Group firms as
leaders of organizations.
We have also revised Tokuyama’s Five Conscience Clauses,
printed on a card that is carried by personnel as guidelines forreviewing their own behavior, and produced the Tokuyama Group’s
Five Conscience Clauses.
To put the Group’s actions into tangible form, we have
distributed a handbook containing the Tokuyama Group Code ofBusiness Activities, the Responsibility ofSenior Management under the TokuyamaGroup Code of Business Activities, and the
Tokuyama Group’s Five Conscience Clauses
to every officer and employee of the Group,
to build and instill compliance awarenessthroughout the Group.

Tokuyama’s CSR Activities

Internal Control System

Special Feature

Corporate Governance Structure

20Tokuyama’s CSR Activities

Maintaining and Improving
Information Security

Information Security Audit Group
Information Security Secretariat

Information Security Manager
General Manager

Information Security Staff
Manager or Assistant Manager

System Staff
Personnel in charge of departmental systems

21

Tokuyama CSR Report 2009

Departmental Management

Director in charge of the Division,
the Head Office or the Factory

Basic Policy
As a member of the Japan Responsible Care Council,
Tokuyama Corporation carries out Responsible Care activities
that protect the environment and preserve safety and healththroughout the entire chemical substance life cycle, fromdevelopment and manufacturing to distribution, use, final
consumption and disposal.
Our social mission is to aggressively tackle andsystematically solve environmental issues in particular,
which, in turn, will lead to sustainable corporate and social
development. Based on this recognition, we are promoting
Environmental Management, a management policy thatemphasizes the environment, in all of our business activities,
including development, manufacturing and sales.

Action Objectives❶ Promote environmental protection●

Implement an ISO14001-based Environmental Management
System and reduce the burden on the environment.

❷ Observe the laws and regulations

Observe international rules, domestic laws and regulations
and industrial standards.
● Thoroughly implement internal export control rules.
●❸ Promote energy conservation and curb global warming●

Achieve top-class unit energy consumption in the industry
for each product.

❹ Promote resource recycling and work toward reduction
and the proper management of waste materials
Promote the material recycling and thermal recycling ofresources.
● Work toward achieving a paperless office.
●❺ Promote process safety, disaster prevention andoccupational health and safety

Aim for zero accidents and disasters based on the principles
of safety self-management and self-responsibility.
● Achieve a comfortable work environment and protect
people’s safety and health.
●❻ Ensure strict product safety standards

Offer environmentally friendly products that can be usedwith safety.
● Provide proper information on how to use products andwhat care to take.
●❼ Deepen the relationship of trust with society

Publicly disclose information on the Company’s activities
concerning environmental protection, process safety anddisaster prevention, occupational health and safety, andchemical product safety.
● Actively engage in dialogue with the local communities.
●

Responsible Care refers to the voluntary management activities
of companies that manufacture and handle chemical substances toprotect the environment and maintain the safety and health ofmembers of the public and employees in all processes covering
the development, manufacturing, distribution, use, final
consumption and disposal of chemical substances. RC also refers
to publishing the results of the activities and engaging in dialogues
and communication with society. RC originated in Canada in
1985, and it is now in place in 52 countries around the world. In
Japan, the Japan Responsible Care Council (JRCC) was establishedin 1995 within the Japan Chemical Industry Association (JCIA). It
had 100 corporate members as of October 2008, Tokuyama being
one of the founding members. We actively work on RC activities
as the basis of our environmental management and CSR activities.

RC Promotion System
Chaired by the President and consisting of members of theBoard of Directors, the RC Administration Committee isTokuyama’s top decision-making body in relation to its RC
activities. It deliberates and approves companywide policies andother environmental, safety and quality measures. Under thisCommittee, there are a number of subordinate bodies, including
the Environmental Measures Committee, the Safety Measures
Committee, the Product Safety and Quality Assurance Committee
and the Product Assessment Committee. They study specificaction plans and conduct product safety assessments. The
Directors responsible for environmental, safety and productquality matters throughout the whole company work as thechairs of these committees, with the members consisting of theheads of the management divisions in charge of each matter.
■ RC Promotion System
RC Administration Committee
Assessment Function

Decision-Making Function

Product Assessment Committee

Environmental Measures Committee(Labeling Assessment Subcommittee)

Safety and Environmental
Assessment Subcommittee

Site Report

Information Security Management Officer

Basic Philosophy of Responsible Care

Harmony with the Environment

System Control
ManagerCompany-wide
management

Information Security Committee

Tokuyama regards the protection of personal information asa symbol of the Company’s spirit of valuing individuals and as a
key obligation in meeting its social responsibility. Based on thisview, Tokuyama has created a structure for improving the levelof protection. Since the Personal Information Protection Act
came into full force in April 2005, we published our Personal
Information Protection Policy on our corporate website. We
also established the Personal Information Protection Promotion
Committee, a body for dealing with inquiries from inside andoutside the Company and other related institutions, andappointed a Committee head who is responsible for overall
control of privacy protection practices in the Company.
The promotion structure extends to every part of theCompany. In each department, a Personal Information
Protection Manager is appointed to ensure sound management
and operation of personal information and to raise awarenessamong all employees. Aimed at encouraging all employees andofficers to remain constantly aware of the importance of
personal information in their activities, our awareness-building
activities include intranet-based education and regular
workplace inspections and audits. We have built a mechanism
for databasing personal information owned by individual
departments and for updating, removing, and checking theinformation on a regular basis. These actions are designed toremind all our employees and officers of the importance of
personal information and to prevent information leaks or otherserious incidents.

Responsible Care

Harmony with Society■ Information Security Management Structure

Furthering the Protection of
Personal Information

Tokuyama’s CSR activities center on Responsible Care (RC) activities. A companywide promotion structure has
been created to soundly operate different management systems. In this way we are continually improving ourenvironmental, safety, and quality management systems.

Tokuyama’s CSR Activities

Tokuyama is proactive and consistent in deploying
information technology as one of the drivers of business reform.
We have been making an intensive effort to ensure soundprotection and advanced use of information, based on theawareness that information security is of growing importance as
we become increasingly dependent on networks following the
IT-driven transition to electronic information and the widespreaduse of the Internet.
In 2001, our top management made a commitment tovoluntary information security initiatives with the participationof all employees. In line with this move, we set up theInformation Security Committee as a body mandated to develop
and implement a comprehensive range of specific steps.
The Information Security Committee was launched with themission of maintaining the security of our information assets,
namely information and information systems, and encouraging
the active use of these assets. It plays a central role indeveloping comprehensive security measures for information
assets and compiling them into Information Security Policies. It
also makes decisions about the Group’s basic policies on
overall matters relating to information security and engages in
activities to increase awareness.
Apart from the policies set out by the Committee,
Tokuyama’s individual departments separately carry out specificinitiatives in accordance with the Company rules instituted in
the Information Security Policies that came into effect in March
2002. Group companies create their own rules based on the
Information Security Policies. The Tokuyama Group is united inits efforts to improve its security level.

Recognizing the recent growth in both the prevalence anduse of Internet technologies, we have been developing
hardware and software measures to prevent infections withcomputer viruses. We strictly forbid the use of any medium
brought into the Company without first performing a virus
check. We also have filtering in place to block access to any
website that is unrelated to business. As a result of these
protocols, we have experienced no serious virus infection in thepast several years. Every employee is aware that a disruption tobusiness activities due to the work required to disinfectcomputers would have a serious negative impact on customer
satisfaction. The effectiveness of these security measures is
supported by this sense of crisis and by our customer-oriented
stance. In cyberspace, however, there is no absolute orpermanent security. We will continue with diligent efforts
without placing undue confidence in existing measures.

RC Promotion Structure andOperation of Management Systems

Special Feature

We understand that information represents not only a powerful tool but also—if it is mishandled—a serious threat
to continuation of the company. We place the focus of our security measures on an accurate understanding of
threats and risks and on securing a balance among confidentiality, integrity, and convenience, and we define themas our guidelines in performing duties.

Safety Measures Committee
Product Safety and Quality
Assurance Committee

RC Research Laboratory(support organization)

Responsible Care Management
Department (office)Checks safety of chemicals and assesses theirenvironmental impacts using simulations.
Environmental measurements, work
environment measurements and ultra-trace
analyses of controlled substances andchemical pollutants are also carried out.

Promotes RC activities throughout theCompany and its group companies covering
areas of the environment, safety and quality

Tokuyama CSR Report 200922

Tokuyama’s CSR Activities
Evaluation and Management
System for RC Activities(Environmental Preservation)

Environmental Impact
Reduction Goals
Environmental
Management Plan
Environmental
Management Activities
Assessment of Activities

Medium-Term
Environmental Plan

ISO 14001 Environmental
Management System
Safety and Environment
Assessment System
RC Inspection and Auditing System
Environmental Accounting
Environmental Performance

Tokuyama has an auditing system that aims at verifying that
individual factories and offices engage in appropriate activities
in line with the companywide policies.

Safety and Environment Assessment
Prior to installing, expanding or modifying any facility, we
assess safety and the environment. We check the safety design ofequipment, the safety level of the materials handled, compliancewith the laws and regulations and the impact on the environment,
thereby aiming to ensure that our facilities are safe, easy tooperate, easy to maintain and accident-free. The assessments
apply to three stages: Basic Plan Assessment, Design Assessment
and Pre-Operational Assessment. At these stages, assessments are
conducted to verify that the facilities have a safety- andenvironmentally oriented design, that they have been built to thedesign requirements and that they are ready for operation.

Product Assessment and Labeling Assessment
To ensure product safety, Tokuyama conducts a productsafety assessment at each stage from research and development
to product delivery to the market. We assess the risk evaluationand examine compliance with the statutory requirements from awide range of perspectives, including the safety of the chemical
substances involved, the environmental impact and the effect onhuman health. We also assess the labeling to ensure that the
product information in catalogs, handling manuals, material
safety data sheets (MSDSs)*¹ and other types of labeling containno defects in relation to the instructions and/or warnings and that
there are no inappropriate expressions.

Operation of Management Systems
ISO 14001 Environmental Management System

ISO 9001 Quality Management System

Occupational Health and Safety Management System
In accordance with the Japan Chemical Industry Association(JCIA) New Occupational Health and Safety Guidelines,
Tokuyama has built and promoted occupational health andsafety management systems at individual factories and offices.
In fiscal 2005, the Tokuyama Factory upgraded its system into
a safety management system covering various safety-related
activities.

Third Party Auditing
Tokuyama undergoes ISO 9001 and ISO 14001 examinations
conducted by accreditation organizations.
The examination to
renew our ISO 9001
certification discovered
two minor deficiencies
and made comments onfive points. Remedialactions were completed
by the end of April 2009.

Brushing up auditing skills to reach a higher
level of internal auditing quality
Continuous self-training is indispensable to effective auditing since
the auditing depends heavily on the skills of auditors. The
Responsible Care Management Department is taking a new initiative
to arrange a capacity development seminar for internal auditors. We
are focusing our energies on human resource
development of them.
We will continue with efforts to build up theauditing skills and capacity of the auditors in aquest for effective auditing that helps enhance thequality of business operations, management,
and environmental activities.

Nobuyuki Miyoshi

Assistant Manager,
Quality Assurance Dept.,
Advanced Materials Business Div.

The examination for renewal of theISO 9001 certification at the Tokuyama
Factory on January 28, 2009

Education and Training
Employee education on responsible care activities are provided forall members within the framework of level-specific group education.
Practical education and training in relation to environmental
management, safety management, occupational health and safety, andquality management are offered as part of actual management
activities.
To take environmental management as an example, the Tokuyama
Factory and the Kashima Factory have formulated specific educationand training plans in accordance with the ISO 14001 environmental
manual to offer education on the importance of environmental
conservation and compliance with relevant laws and rules to
employees and contracted workers alike.
In safety management and occupational health and safety, we offer
Kiken Yochi (hazard prediction) training, hands-on experience
training, pre-work Kiken Yochi activities, safety regulation education,internal special education on electricity, oxygen deficiency, waste
incinerators and other areas, foreman education, troubleshooting
training, training on use of fire prevention and extinguishing systems,
evacuation drills, general disaster drills, traffic safety education, andtraining on aid activities following external accidents and disasterprevention.
For quality management, every workplace separately organizes
safety meetings and other opportunities for ISO-related education.
Twenty-one key personnel at different workplaces have completed
the ISO 9001 internal auditor development course. In October 2008,
we organized a seminar on fault tree analysis (FTA) with an outside
lecturer.

Voice■ Fiscal 2008 RC Activities – Priority Issues and Performance
Segment
Management
Environmental conservation

impact•Environmental
reductionconservation•Energy•Waste recycling

Process safety

Occupational health and safety
Chemical product safety

Cultivation of a
relationship of trust withsociety and the local
communities
Promotion of RC programs
targeting group companies

Priority issues•Review by top management
in environmental impact•Reduction(air, water quality, etc.)
in the emission of PRTR
•Reduction
substances and hazardous air pollutantsin unit energy consumption•Decreaseof zero-emission activities•Promotion•Promotion of green purchases

Performance

Related pages

Administration Committee•RC•Safety and Environment Auditof the emission of SOx, NOx, soot, etc.
•Reductionof energy conservation•Promotionof the use of waste as raw materials and•Facilitation
fuels for cement
procurement of office supplies and lighting•Greenequipment
operation of the environmental•Unfailingmanagement system

operation of the safety management system
accidents•Proper•Zero
Safety education and auditing of the providers ofof risk management••Promotion•Promotion of independent safety management contracted logistics
to prolong the disaster-free period•Efforts•Zero disasters•Promotion of risk assessmentof product assessment and labeling•Implementation•Securing of product safetyassessment•Improving MSDSs and research for new raw materials
in community volunteer activities
in community activities•Participation•Participation
Dialogue meetings on RC activities with local
coexistence with society and••Harmonious
communities (held independently by the factory)
the local communities•Organization of factory tours
and environmental inspection•Safety•Dissemination of RC activities
of ISO certification acquisition•Encouragement•Sharing of RC-related information

P22ー24
P41
P39
P13ー14
P32
P22ー24
P35ー36
P27

Site Report

Tokuyama has also acquired ISO 9001 certification for its
quality management system that covers its principal products.
Since fiscal 2002, this system has been operated as a systemcovering sales, development and all other divisions of theCompany.

Tokuyama conducts this audit for the operation safety andenvironment on a yearly basis to verify the appropriateness of its
accident/disaster prevention measures and management
activities in relation to environmental conservation. The auditing
team is headed by the director, who chairs the Environmental
and Safety Measures Committees, and conducts audits of all
factories and offices, authorized inspection organizations underthe High Pressure Gas Safety Law, logistics departments and the
Health Management Center. The results of the audits aredeveloped into reports and distributed to all departments
concerned. The results are also presented to the president.

Harmony with the Environment

The Tokuyama and Kashima Factories have already acquired
ISO 14001 certification. ISO 14001 is an international standard
for environmental management systems. In line with thecompany-wide environmental policy, each factory sets out anenvironmental policy and the specific goals to be achieved inareas covering environmental impact reduction, energy
conservation, waste reduction and resource recycling.
At the head office, branch offices and research laboratories,
activities are underway based on their respective policies andgoals set out in response to their scales, covering energy
conservation, waste reduction, resource recycling and otheractivities.

Safety and Environment Audit

Harmony with Society

Incorporation into the following
fiscal year’s goals and plans

RC Activity Goals

Tokuyama has set up several assessment systems in an effort
to reduce environmental and safety risks.

Tokuyama conducts internal auditing on a regular basis inaccordance with the ISO 9001 and ISO 14001 standards and withthe occupational health and safety management system. The
progress of the planned actions and the status of system operations
are audited. If a deficiency is found, it is identified and corrective
actions are instituted.

Tokuyama’s CSR Activities■ Evaluation and Management System for RC Activities

Auditing Systems

Special Feature

Tokuyama adopts a three-year plan in the area of responsible
care and determines its policies and targets for separate fiscal years
to achieving the plan. Under these policies, the individual
departments create specific plans and engage in their activities. The
results of the activities are assessed at the end of the fiscal year sothat the plans for the following fiscal year will reflect the findings.
Tokuyama formulated a new three-year plan starting in fiscal
2008. Activities under the plan are now in process.

Internal Auditing

Assessment Systems

P35ー36

P25ー26

P28ー30

P47ー48Terminology *1 A material safety data sheet (MSDS) is a document that deals with the hazard and toxicity of a chemical substance. It is prepared to ensure the safe handling of a particular
substance, and provides information on the name of the substance, safety measures, the action to be taken in the event of an emergency and suchlike.

23

Tokuyama CSR Report 2009

Tokuyama CSR Report 200924

Harmony
with SocietyComprehensive Safety Managementof Chemicals
Data Acquisition and Analysis on the Safety of Chemical
Substances

TopicsAssessments for ensuring safety
In fiscal 2008, Tokuyama carried out 42 productassessments and 274 labeling assessments.
● Tokuyama is moving ahead with GHS compliance for
products containing substances subject to GHS rules.
●

Tokuyama CSR Report 2009

To eliminate any pollution to the environment, we monitor
the concentration of chemicals in effluents and gas emissions.
In addition, we simulate the distribution of the concentrationof chemicals and analyze in detail their movement. Their risks
are evaluated after combining the data on concentration andthe safety data. The resulting assessment data are used to
improve equipment safety measures and the manner ofhandling chemicals as well as for the education of those who
deal with chemicals. They also serve to increase product safety
and to provide customers with accurate information.

Compliance with GHS
The Globally Harmonized System of Classification andLabelling of Chemicals (GHS)*¹ refers to a system promoted by
the United Nations under which chemicals are sorted by thetype and level of hazard and toxicity in accordance withinternationally standardized rules to provide labels and safety
data sheets that can be understood at a glance.
For fiscal 2008, our quality control goal was addressing GHS
compliance. We performed GHS classification of all our
products, excluding those under development and molded
items, in an effort to create GHS-compliant labels and material
safety data sheets. We made particularly strong efforts to createlabels and MSDSs for products containing chemicals subject tothe three laws described below.
Chemicals that are subject to the three laws refer to thepoisonous and deleterious substances controlled by the
Poisonous and Deleterious Substances Control Law, those■ Process Flow in the Assessment Structure for Ensuring

Safety and Environmental Conservation

Assessment
Stages

Product
Assessment

Commencementof Research

Development groupleaders and others

Commencementof Development

Safety andEnvironmental
Assessment

Safety Management of Waste
Labeling
Assessment(primary assessment)

Head of the Researchand Development
Division and others

Labeling
Assessment
Subcommittee(secondary assessment)

Tokuyama offers MSDSs for all its products and prototypes to
its customers and distribution agents. MSDSs have been
prepared for around 600 products as of March 2009. In
particular, for the 41 products that are transported in large
quantities and heavily used by our customers, MSDSs arealways made available on the Company’s website.
To deal with any problems in transit, we have created
Yellow Cards*² and each of our drivers carries them. They
include information on immediate measures to be taken in caseof emergency. MSDSs and Yellow Cards for individual products
are published on our Intranet to ensure the sharing of safety
information.

Waste is handled in the same way as our products. We
prepare MSDSs for waste and distribute them to waste disposal
operators and distribution agents to ensure safety in handlingand transportation. Particularly in the case of highly hazardous
waste, Yellow Cards have been created to ensure that every
driver carries them and that they can deal with any problem
during transportation.
We have so far created MSDSs for 73 types of waste andYellow Cards for 41 types of waste.

(prototypes)

EH&S*³ Actitivies concerning Tokuyama’s Products
Study onCommercialization

Product Assessment
Committee(tertiary assessment)

Equipment
DesignSafety andEnvironmental
Assessment
Subcommittee(basic planning)

Labeling
Assessment
Subcommittee(products)

Safety andEnvironmental
Assessment
Subcommittee(design)

Safety andEnvironmental
Assessment
Subcommittee

Prior toMarketing(operarations)(prior to operations)

After
Operations

Report on Actual
Conditions

The IC Chemicals Department began to proactively offer
guidance on the proper use of Tokuyama’s products to users aspart of its responsible care activities.
In fiscal 2007, a project team was established to support thisactivity, and is called the Environment, Health & Safety (EH&S)
Promotion Team. It provides users of Metaclene®, ourchlorinated solvent product (dichloromethane), and otherproducts with environmental, health, and safety information
through briefings and other forums. Dichloromethane is one ofthe volatile organic compounds that have recently been subject
to discharge control. We continue with the service of offering
individual users proposals on appropriate application aftergathering information on the environment in which thecompound is used and on their equipment maintenance andmanagement status.

(environment)

Site Report

25

Risk Assessment and the Management of Chemicals

Tokuyama assesses the safety of both the chemicals andequipment units that it manufactures, in every stage fromresearch and development through to commercialization. We
made 42 assessments of this kind in fiscal 2008.
We also conduct labeling assessments for our catalogues,
MSDSs and other technical documents. The appropriatenessand legality of the representations on labeling and packaging ofproducts, prototypes and sample products are examined andany inappropriate representations are corrected.
In fiscal 2008, we conducted 274 labeling assessments.

Harmony with the Environment

Based on implementation of the ISO 9001 quality
management system, Tokuyama’s quality assurance
activities place first priority on the customers. The
safety management of chemical substances is rigidly
instituted at all stages of the product process ranging
from research and development to disposal andeven including transportation.

Provision of Information on Chemical Products
Assessment of Products and Labeling

Harmony with Society

Relationships
with Customers

Tokuyama collects and organizes safety data coveringchemical substances so that the safety of the chemicals can beassessed. The data collected and organized is used to provide
safety data on products and waste.
We are working to gain information on the hazards andtoxicity of all chemical substances to be newly used,
manufactured and discarded by means of product assessment,
waste surveys and the analyses of new raw materials.

working to achieve full REACH compliance without any
omission by joining a consortium, building a structure including
a registration agent, conducting information gathering
operations, and holding internal liaison meetings as needed.

Tokuyama’s CSR Activities

As a company that is dedicated to its customers and that isalways preferred by customers, Tokuyama places first priority on
supplying customers with premium-grade products and services
to meet their needs and to reassure them about their use.
Tokuyama implements quality management and quality
assurance activities under the ISO 9001 quality management
system. We are working to comply with the ISO 9001: 2008,
which was released in November 2008.
Our management system covers the entire Company,
including its branches, sales force, and the research section. We
make sound and quick responses to customers’ complaints andrequests. Information from customers is sorted by division andposted to the groupware portal so that it can be shared.

subject to notification under the Industrial Safety and Health
Law and designated substances under the Law Concerning
Reporting, etc. of the Release of Specific Chemical Substances
to the Environment and Promotion of the Improvement of Their
Management.

Special Feature

Tokuyama is committed to building good relationships
with all stakeholders, to achieving business management
in harmony with society and to engaging in advanced
CSR activities to pursue growth together with society.

Satisfaction and Security –Quality Assurance System

REACH Compliance
REACH refers to the European Union’s legislation onregistration, evaluation, authorization, and restriction ofchemicals. It came into force in June 1, 2007. REACH is anabbreviation for registration, evaluation, authorization andrestriction of chemicals.
To comply with the REACH regulations, Tokuyama madepreliminary registration of products subject to the legislation by
December 2008 after identifying the items and quantities
exported to the European Union. There are approximately 20
products subject directly or indirectly to the regulations. We are*1 GHS refers to the global harmonized system of classification and labelling of chemicals.
*2 A Yellow Card is a commonly used name for an emergency notification card containing
information on the immediate action to be taken by the driver, nearby operators,
firefighters and police officers in the event of any accident involving a particularchemical substance in transit.

*3 EH&S stands for environment, health and safety.

Tokuyama CSR Report 200926

Harmony with Society
Promotion of Safety and Environmental
Management in the Distribution Process

RC Community Dialogue at the Tokuyama Factory

We have established emergency response criteria to deal withpotential crises in logistics operations. The equipment and materials
necessary for disaster prevention are always ready for use.
Jointly constructed with logistics operators, the mutual disaster
control assistance system is in place at principal locations in
Shunan, Kanto, Kansai, Chubu, and other key districts.
We are encouraging our contracted freight companies to equip
their trucks with global positioning systems (GPS).

Environmental Preservation Measures and Energy
Conservation in Transportation

A high pressure gas disaster drill on December 4, 2008

Relationships with
Communities and Society
Tokuyama has been engaged in a broad array ofactivities directed at making a social contribution.
They include financial support for the developmentof science and technology and assistance to facilitate
the sound growth of our children. In addition, wehold RC community dialogues to communicate withlocal residents.

Harmony with Society

In April 2009, we acquired the green management
certification for our land transportation section. We are working
actively toward environmental compliance. Together with ourcontracted freight companies, we are introducing vehicles that
conform to exhaust regulations and energy efficiency, as well as
digital tachographs and other devices that support
environmentally friendly driving.
Following the Law Concerning the Rational Use of Energy,
we are actively making efforts to conserve energy as a specified
cargo owner. On a ton-kilometer basis, we have reached amodal shift ratio*¹ of 95%, chiefly with marine transport.

On August 21, 2008, the Fiscal 2008 RC Community Dialogue
took place at Tokuso Kaikan. This event is organized independently
by the Tokuyama Factory each year in collaboration with the Shunan
City Government for neighboring community associations in aneffort to deepen their understanding of the Factory’s environmental
conservation, safety and disaster prevention efforts.
The RC Community Dialogue in question attracted 16
participants from community associations and two from themunicipal government. It included a briefing on the Factory’s efforts,
a factory tour, and a session for information exchange. This fifth
Dialogue in the series was joined by the general managers of the
Cement Manufacturing Department, the Steam & Power Generation
Department and the Chemicals Manufacturing Department 2 tolisten directly to the opinions of the community associations.
The participants exhibited great interest in environmental andsafety issues. They asked questions and made comments, particularly
concerning our odor and dust control efforts. The factory tour gavethem a good insight into safety, disaster prevention, andenvironmental conservation activities at the Tokuyama Factory.

Tokuyama’s CSR Activities

At different locations, Tokuyama organizes periodical safety
meetings with logistics operators all over the country undercontract to transport its products. We perform logistics auditing
for them to improve the level of logistics safety management andactively promote the practice of accident reporting andanti-accident actions.
On the premises of the Tokuyama Factory, dedicated safety
managers perform regular patrols of loading points andworksites, and provides guidance onboard freight vessels incollaboration with logistics companies to raise safety awareness.

Crisis Management System

Special Feature

Guidance and Education on Safety Management toContracted Logistics Companies

Communication with the Local Community

Risk Assessment

TopicsThe Fiscal 2008 RC Community Dialogue took placeat the Tokuyama Factory for community associations
near the factory.
● Tokuyama joins the TABLE FOR TWO program.
● The Tokuyama Science Foundation marks the 20th
anniversary of its founding with a commemorative
ceremony.
●

The Daisan Tokuyama

Green Management Certification

Forest Volunteer Activities
A project for creating a forest for water conservation, called theMeeting for Exchange among the City, the Forest and the Water,
took place under the auspices of the Yamaguchi Prefectural
Shunan Agriculture and Forestry Office at the municipal Ishinabe
Forest at Kanokami in the city of Shunan. Aimed at securing astable supply of high quality water by creating a forest as a green
dam with high water retention capacity, this volunteer activity
program included improvement cutting to remove weeds that
impede the growth of trees, tree thinning and planting of broad
leaf trees. The activity involved 133 Tokuyama staff members, whotook part in pruning branches and other activities under theguidance of forestry instructors.

Site Report

The Ministry of Land, Infrastructure, Transport and Tourism andthe Foundation for Promoting Personal Mobility and EcologicalTransportation have developed a Green Management Promotion
Manual, including a checklist for self-evaluation in an effort toencourage transport businesses to increase their environmental
conservation activities.
The Green Management Promotion Manual sets out theactions required to meet each of the environmental conservation
criteria in the checklist, which are to be addressed in accordancewith the concept of the ISO 14031 standards for environmental
performance evaluation. It facilitates target setting andevaluation, stimulates efforts toward green management andopens the way for voluntary continuous activities forenvironmental conservation.
The Foundation for Promoting Personal Mobility andEcological Transportation acts as certifying body for the green
management certification. It grants certification and registration
to those operators that are confirmed by its examination to carryout activities that meet or exceed a predetermined level inaccordance with the Green Management Promotion Manual.

The RC Community Dialogue at the Tokuyama Factory

Harmony with the Environment

Before hazardous materials are transported, we conduct risk
assessments to verify the safety level of the mode oftransportation, the trucking route and the emergency measures
to be taken in the event of an accident. If anything that presents
a high level of risk is found, it is remedied methodically.
Whenever any new logistics facility is constructed or expanded
inside or outside a factory, a facility safety assessment isconducted to assess the risk from the phase of facility design.
The Company continues with efforts to enhance theconditions at users’ premises, such as remediation of defective
facilities at the delivery destination.
In addition, we work unfailingly to ensure full compliancewith the Marine Pollution Prevention Act. For instance, we
ensure that the Emergency Action Manual for the Prevention ofHazardous Liquid Contamination is always available at relevant
ground facilities.

The Forest Volunteer Activities on October 11, 2008

*1 The modal shift ratio is the ratio of freight or passengers transported by alternative means,
specifically rail and ship in substitution for automobile and aircraft.

27

Tokuyama CSR Report 2009

Tokuyama CSR Report 200928

Harmony with Society
Communication with the Local Community

Tokuyama Science Foundation

Report on Activity in Nepal
The program for donating and delivering to children in Nepal
our uniforms for female employees that are no longer in use
following a design change is now in its fourth year. In the fiscal
year under review, we again delivered white blouses and vests
worn at our head office and branches to Balwapati Primary andSecondary School in Nagarkot, Nepal, with the help of Ms.
Fumiko Kojima of Shunan Municipal Shuyo Elementary School.
We enjoyed seeing the smiles of schoolchildren.
Ms. Kojima began her international exchange volunteer
activities in 1994 and has since 1996 been engaging in an aid
initiative to deliver stationery and uniforms by hand to Nepali
schools in mountainous regions each year.

Schoolchildren
at Balwapati
Primary andSecondary
SchoolThe Table For Two Program

Two pupils from the Tokuyama Commercial Technical HighSchool worked with us as interns for two weeks from July 27,
2008. As in 2007, this internship program was run in line with
the Japanese version of the dual system promoted by the
Ministry of Health, Labour and Welfare and the Ministry of
Education, Culture, Sports, Science and Technology.

A scene from the internship training“Invention” Class for Boys and Girls
Tokuyama took part in an “invention” class organized chiefly
by the Tokuyama and Shin Nanyo Chamber of Commerce andIndustry in October and November 2008, as an opportunity forelementary schoolchildren in the Shunan district to discover thejoys of chemistry. Five Tokuyama staff members acted as
lecturers to observe the properties of salt, starch, silica andother powdery substances and to perform an experiment
making hand impressions using impression materials together
with the participating children.

Harmony with Society

Tokuyama’s exhibition booth, as the baseball board game generates
great excitement

In December 2008, the Tokuyama Factory launched an
initiative to contribute 20 yen per low-calorie lunch mealpurchased at the canteen to the Table For Two program,which offers school meals in developing countries. Called
the TFT lunch, the meal is offered at the factory every
Wednesday. In the first month, 683 meals were purchased.
Each donation pays for one school meal in developing
countries. This means that our first month’s donation can
provide 683 schoolchildren with a school meal.

The Tokuyama Science Foundation was established on
September 19, 1988, marking its 20th anniversary in 2008. The
mission of the Foundation is to offer financial support for
research into new materials and related sectors, and to raiseawareness of new materials that have the potential to lead toadvances in science and technology, thereby enablingsocioeconomic development and improving the lives of people.
Over its 20 years, the Foundation has offered research grants
to 303 young researchers in universities and research
institutions, financial support for exchange at international
symposia to 224 young researchers, and grants for campaigns tostimulate the interest of younger people in science andtechnology. The Foundation has to date offered more than 700
million yen to 576 projects. Recipients of the Foundation’s
support are now playing active roles in a broad array of fields.
On December 4, 2008, we organized a ceremony tocommemorate the 20th anniversary of the establishment of theFoundation. A research presentation meeting took place tocoincide with the ceremony. At the meeting, 16 researchers
from 14 universities delivered presentations on their researchfindings. There were also active discussions with the audience.
The Tokuyama Science Foundation will continue to provide
financial support to encourage the development of science andtechnology.

Internship for High Schoolers

Tokuyama’s CSR Activities

An environmental event hosted by the Yamaguchi Prefectural
Government, called Yamaguchi Iki-Iki Eco Fair, took place at the
Yamaguchi Kirara Expo Memorial Park in Ajisu, Yamaguchi City
on October 18 and 19, 2008, attracting approximately 40,000
visitors.
As a manufacturer of polycrystalline silicon for solar cells,
Tokuyama ran an exhibition booth to explain its efforts to
reduce energy consumption and to combat global warming
through the spread of solar cells. We provided parents andchildren visiting our booth with an opportunity to build
miniature solar systems and take part in a quiz. A long line ofpeople waited to play the Tokuyama Baseball Board Game
created by the Si Development Dept. for this event. Many
parents and children enjoyed the home run race.

Encouraging the Next Generation

Special Feature

Taking part in the Yamaguichi Iki-Iki Eco Fair as an
Exhibitor

Communication with Overseas

Launched as a project for the local community, the Shunan
Swimming Club celebrated its 30th anniversary and organized
a commemorative event as a demonstration of gratitude to local
people. At the event, Duke Saraie gave a lesson on good
posture, and held Duke Walk, seasoned with humorous
comments in his Kansai accent, creating much laughter among
the more than 1,000 participants.

Harmony with the Environment

The Shunan Swimming Club turns 30.
Duke Saraie’s Walking Live & Exercise Held
Lunchtime withTFT lunch

Voice
A volunteer activity allowing for casual participation

An Exciting World of Chemistry“Invention” class for boys and girls

In 2008, we set up and ran another exhibition booth at theHiroshima Chemistry Show, designed to give children aninterest in chemistry. At the sections for making fuel cells using
our independently developed electrolyte membranes for fuelcells and for making Karumerayaki sugar cookies using our
sodium bicarbonate, a cumulative total of 1,400 excitedchildren experienced the wonder of chemistry.

Site Report

Half a year has passed since the TFT lunch began
to be offered in December 2008. At our workplace, it
seems that there are now a considerably larger
number of orders for the TFT lunch than there were in
the early days of the program.
An advantage of the program lies in that part of oureveryday life serves as a volunteer activity. It is ideal
for people, like me, who are interested in volunteer
activities but are hesitant to take part in any special
event. I would like to introduce toas many people as possible thisgreat initiative, which turns part ofour daily life into something
helpful for the next generation.

The commemorative ceremony for the 20th anniversary of establishment of the Tokuyama Science Foundation on December 4, 2008

Yukinobu Aimoto

A scene at the commemorative event on August 30, 2008

Assistant manager, First Team,
Manufacturing Sect 1,
Si Manufacturing Dept., Si Business Div.

At the venue of the Hiroshima Chemistry Show

29

Tokuyama CSR Report 2009

Tokuyama CSR Report 200930

Harmony with Society
Information Disclosure

13.0%

Individuals
and others
52,025

0.8%

44.1％

Annual Report

URL

For Investors on Tokuyama’s website

23.2%(Unit: thousand shares)

Tokuyama CSR Report 2009

Tokuyama aspires to be a good partner that shareswith its suppliers the common goal of creating good
products. To attain this goal, Tokuyama welcomes
suppliers with unique proposals for creating anenvironment that gives new suppliers easy access toopportunities for transactions.
Promotion of Green Purchasing
Tokuyama views the Reduce-Reuse-Recycle (3R)
perspective as another possible criterion for choosing
suppliers to promote environmental conservation in its
purchasing activities.
Note: The Basic Purchasing Policy does not constitute partof any agreement, nor does it indicate any offer toenter into an agreement.

Providing timely and easy-to-understand information

Suppliers are key partners.

My assignment is website production. I am responsible not
only for quickly and accurately offering financial resultsmaterials and updating data that is useful to shareholders andinvestors, but also for publishing special features to aid inunderstanding our operations. These features focus, forexample, on Tokuyama products close to everyday life and on
notable spots and items in the Tokuyama Factory.
My task is to constantly provide timely
information that is easy to understand.

Aware that securing supplies of stable quality is a critical issue,
the quality assurance groups of different divisions and thePurchasing Dept. take the initiative in conducting regular quality
audits of our suppliers. Individual suppliers are ranked based on the
degree of importance of the goods purchased from them. A quality
audit consists of on-site and document audits. Rather than simply
unilaterally citing deficiencies, we work together with our suppliers
to come up with remedies. I believe that our periodical quality
audits of suppliers play a very significant
role in ensuring that we consistently haveaccess to quality supplies.

Akiko Nakano

31

The Purchasing Dept. is stepping up its effort to sign
basic agreements setting out important generalprovisions with all suppliers. These agreements seek toclarify the general terms and conditions and are not used
to infringe on any particular contracts or provisions. Thisinitiative helps raise the quality and efficiency ofpurchasing agreements, and aids internal control andcompliance efforts inside and outside the Company.

Voice

Corporate Communications &Investor Relations Dept.,
Corporate Planning Div.

In its purchasing activities, Tokuyama complies withthe letter and with the spirit of the relevant laws andregulations. Tokuyama also requires its suppliers tocomply with them and chooses suppliers that meet therequirement.

Site Report

Foreign corporations
and other foreign
investors
63,872

Statutory CompliancePartnership

http://www.tokuyama.co.jp/eng/ir/index.html

Voice

18.9%

Tokuyama regards its suppliers as important business
partners, and continuously strives to build relationshipsof trust with them through fair transactions. To create ahighly efficient collaborative structure, we incorporate
CSR initiatives into our purchasing operations.

Aiming to sign basic agreements about transactions

Financial
instrument brokers
2,298

Financial
institutions
121,559

Relationships with
Trading Partners

Tokuyama evaluates its trade partners from an overall
perspective that includes quality, pricing, delivery dates,
technical capabilities, credibility, safety, after-sales
service, serviceability, the ability to respond to incidents,
compatibility with existing equipment and businessstability to choose suppliers that best suit the Company.

Harmony with the Environment

Other Japanese
corporations
35,915

Optimum Transactions

Topics■ Composition of Shareholders(as of March 31, 2009)

Tokuyama’s Basic Purchasing Policy

Harmony with Society

The financial
results briefing on
May 14, 2009

On the basis of its fair and sound partnerships with suppliers,
Tokuyama carries out its purchasing operations in accordancewith its Basic Purchasing Policy, to supply its customers withgood products backed by outstanding technologies.

Tokuyama’s CSR Activities

To earn the understanding of shareholders andinvestors and to respond to their confidence andexpectations, Tokuyama is actively committed totimely, appropriate, and fair information disclosure.
Through such disclosure, we seek to engage in a
broad dialogue with society.

Special Feature

Relationships
with Shareholders

Fair Transactions

To provide information to investors, Tokuyama has opened a
For Investors section on its website. This section provides stock
information, consolidated financial data, information on general
meetings of shareholders, an IR calendar, and financial reports
such as financial summaries, electronic public notices, securities
reports, annual reports, and presentations for IR meetings.
After announcing full-year financial results in May andsecond-quarter financial results in November, we organize an IR
meeting for analysts and institutional investors and a factory tour
guided by our IR personnel. The IR meeting includes apresentation from our president on business conditions, giving us
an opportunity to speak directly with our investors.
For overseas analysts and institutional investors, we makeabout three overseas visits each year, specifically to Europe, theUnited States, and Asia, to hold meetings in the framework ofoverseas IR activities. We will in the future continue to actively
provide information in a timely, appropriate, and fair manner.

Shinichi KimuraManager, Responsible Care Management Dept.,
Corporate Social Responsibility Div.

Tokuyama CSR Report 200932

Harmony with Society
Addressing the Development of
Human Resources
Capitalizing on the Skills Education and Training CenterIn fiscal 2008, the Manufacturing Skills Education
Course I was introduced. A cumulative total of 106
participants have so far taken part in the course.
● In fiscal 2009, Manufacturing Skills Education Course
II will be introduced.
●

Tokuyama CSR Report 2009

Tokuyama is dedicated to developing global human resources,
to attain the goal defined in its Centennial Vision.
With a principal objective of developing successors for
personnel stationed overseas, a training session for international
capacity development took place. The fifth session was held during
fiscal 2008. This is a composite training program including not only
English-language lessons but training on presentation and businessmeeting skills in preparation for overseas business settings. The
session used to be held once every two years but we will beorganizing another session in fiscal 2009, in view of our current
need for workers who are comfortable in an international
environment.
Pre-appointment training for personnel stationed overseas wasoffered to nearly ten relevant staff members in fiscal 2008. Before
assuming their new posts outside Japan, these employees learned
about the cultures and customs of their destinations. After they
assumed their posts, we offered training in analyzing actual events.
In fiscal 2009, we will be inviting local staff members from ourgroup companies operating in the Asian region to a tentatively
named Asia International Meeting, so that they can talk about the
problems that confront them. To bring all our staff closer together,
we are determined to extend the unity of the Tokuyama Groupbeyond Japan.

Personnel Management System toEnergize Human Resources

Improvements to Health through the THP

Work-Life Balance
To achieve an appropriate work-life balance, Tokuyama isrevising systems from many different perspectives. In fiscal 2008,
we extended the period of childcare leave to allow parents toremain on leave until their child turns two years old. In addition,
we introduced a shorter working hours program. More than halfof those who have returned from childcare leave take advantageof this scheme. We have also added a paid childcare leave
program that enables any employee to take a maximum of fivedays’ leave within eight weeks of their spouse giving birth. Thishas made it easier for fathers to participate in childcare.

In accordance with the Guidelines for Health Improvement
under the Total Health Promotion (THP) Plan put forward by the
Ministry of Health, Labour and Welfare, Tokuyama operates anextensive program of activities to address priority issues incombating lifestyle-related diseases and promoting mental
health.
To tackle lifestyle-related diseases, our industrial physicians
and medical staff provide employees with individual guidanceon the basis of regular health checks. Our health management
personnel also visit workplaces to run Mini Health Classes.
To promote mental health, we offer an online occupational
stress checkup service to assist in mental health care. In fiscal
2008, we designated model workplaces, analyzed theirconditions, and then used the results of the analysis to conduct
activities for mental and physical health.

■ Trend in the Number of Employees on Childcare Leave (persons)Fiscal 2004

Fiscal 2005

Fiscal 2006

Fiscal 2007

Fiscal 2008

9

13

3

11

6

Actions Toward Diversity (the employment of physicallychallenged persons and retiree reemployment program)In fiscal 2008, 1.98% of Tokuyama’s employees were physicallychallenged persons, meaning that the Company had satisfied thestatutory employment requirement for physically challenged
persons of 1.80% for the second consecutive year. Going forward,
we will expand opportunities for physically challenged workers, inan active effort to address the employment issues.
Tokuyama instituted a retiree reemployment scheme in fiscal
2001, one of the first companies in its industry to do so. In
fiscal 2008, 43 of the 80 employees who reached the age ofretirement were reemployed. We anticipate that these
employees will continue to display their excellent skills andexpertise in their respective workplaces.
■ Trend in Employment Rate of Physically Challenged Persons (%)
Fiscal 2004

Fiscal 2005

Fiscal 2006

Fiscal 2007

Fiscal 2008

1.59

1.80

1.65

1.93

1.98

Voice
Providing assistance in raising health awareness
The Health Management Center provides specific healthguidance for those with metabolic syndrome in association
with the health insurance association.
As we think about the approach to improving lifestyles interms of diet and exercise together with those who suffer frommetabolic syndrome, we realize that some will have difficulty
making the lifestyle changes required. Our goal is to makesuggestions in these circumstances to motivate themto voluntarily start improvement efforts.
We consider their lifestyle and provide
assistance in improving health awareness sothat they can take steps suited to them.

Site Report

33

Globalization Initiatives

Promotion of Improvements to Mental
and Physical HealthHarmony with the Environment

Providing technical education and training

A training session at
Tokuyama Factory

Organizing a
conference of
junior coaches(Sept. 11, 2008)

Harmony with Society

TopicsSet up in 2003, the Gender-Free Committee is dedicated toencourage the next generation of workers, promoting
affirmative action, and improving the working environment,
particularly to prevent sexual harassment. The Committee
originally consisted of staff from the Tokuyama Factory. Since
fiscal 2008, representatives from head office and branches havealso taken part, so that the Committee can be active throughout
the Company. The Committee meets on a regular basis andpublishes reports on gender-free initiatives that are designed toraise awareness in the Company. In tandem with the expansionof helpline services in August 2009, a consultation service withan outside female lawyer will be added. We will continue ourefforts to offer better working environments.

Tokuyama’s CSR Activities

Tokuyama is committed to improving the working
environment to ensure that individual employees can
exhibit their capabilities and engage in their everyday
duties with motivation. In fiscal 2008, we focused
greater energy on human resources development andon improving mental and physical health, with aview to improving our front-line capabilities andbecoming a more global company.

Actions against Sexual and Other Harassment

Junior coaches are advisors and counselors for new employees
joining Tokuyama after graduating from high school. Twenty-one
junior coaches gathered at the Tokuso Kaikan building to holddiscussions and present on subjects such as what values new
employees should have and what they should learn from seniorpersonnel. The meeting confirmed the importance of building
communication skills and the significance of having an attitude
of positively addressing any challenge.

Special Feature

Relationships
with Employees

Inaugurated in 2007, the Skills Education and Training Center
offers new operators with training mainly in basic skills and safety
under the slogan of “Experience, Feel, and Learn.” This follows anincrease in the number of newly recruited employees and thelaunch of new plants in recent years.
The basic skills education allows trainees to learn about
internal structures and detailed operations of systems by
disassembling, drawing, and reassembling actual equipment sothat they can study the basics of the systems. Safety education iscentered on experiences of dangerous events, such as falling
objects or objects getting snagged with other objects or inmachinery.
In fiscal 2008, the Manufacturing Skills Education Course I was
launched for operators in their second or more year of service. A
total of five courses were held, including the operation
management course that prompts its participants to use their own
discretion for operating the machinery at the training plant. A
cumulative total of 106 trainees have so far taken part in this course.
We called on group firms and contractors to participate in thehazard experience course. This program was taken by some 180
trainees in fiscal 2008, including those from overseas groupcompanies based in China. This gave us a glimpse of
globalization.
In fiscal 2009, Manufacturing Skills Education Course II for
operators in their sixth or more year of service will also belaunched.

Organizing a Conference of Junior Coaches

Sachiko Nishimoto

Nurse,
Health Management Center,
General & Personnel Affairs Div.

Tokuyama CSR Report 200934

Harmony with Society
Commitment to Safety and Disaster
Prevention
All-Inclusive Safety and Disaster Prevention Activities

Toshiyuki Kaneda

Assistant Manager, Manufacturing Section 2,
Manufacturing Dept. 1,
Chemicals Business Div.

35

Tokuyama CSR Report 2009

Annual fire brigade review andgeneral disaster drill on thepremises on January 23, 2009

Encouraging Voluntary Safety Activities
The Tokuyama Factory is accredited as a certified safety
inspection operator and a certified completion test operator for
twelve facilities pursuant to the High Pressure Gas Safety Law and isqualified to continuously operate boilers and other equipment. We
ensure appropriate operations in compliance with the accreditation
requirements. We also follow the principle of conducting voluntary
safety activities under our own responsibility to run theplan-do-check-act (PDCA) cycle in safety management withcomplete consistency. While raising the awareness of safety among
all employees, we will endeavor to prevent accidents and disasters.
We encourage the management teams for operations to engage
in their voluntary safety activities. The equipment management
section is working to build up its engineering expertise in ensuringsafety for maintaining the stable operation of the plants.
Terminology *1 Five-S activities: An initiative to ensure the five-S features at the workplace. The
five-S’s refer to Seiri (tidy), Seiton (organized), Seiketsu (clean), Seiso (clean) and
Shitsuke (disciplined).

Chemical industry

2.0

Tokuyama
1.5
1.0
0.5
0.0

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 (Fiscal year)
Source: Japan Industrial Safety & Health Association (JISHA)
Ratio of Industrial Injuries and Deaths by Industry on the JISHA website■Trend in Severity Rate of Accidents*²
Safety Audit
Kashima Factory on
October 23, 2008

0.25

All industries
Chemical industry

0.20

Tokuyama

Safety and Environment Assessment
When installing, modifying or adding any equipment, the headof safety calls internal experts to perform assessments at theplanning stage, at the design stage and at the stage before starting
operations. Each assessment conducts pre-emptive checks andexamines any latent risks that may arise for the purpose ofremediation and improvement. This ensures the safety ofequipment, process and operation and prevents accidents anddisasters from occurring.

Efforts to Maintain the Safety Performance and to
Prolong the Accident-Free Period
Our safety activities have been conducted to meet the goal ofachieving zero-accident and zero-disaster status. The Tokuyama
Factory introduced special safety activities under the Safety Day
initiative in addition to safety management activities based oncomprehensive line management and collaboration with
contractors. However, the factory did experience one on-the-job
accident that forced one employee to take a leave of absence, andthere were seven such incidents at contractors and otherassociates. This means that we failed to fulfill the target ofcompletely eradicating on-the-job accidents that resulted inworkplace absentees.
The Kashima Factory has maintained its zero-accident andzero-disaster status for 23 years since its inauguration. The
Tsukuba Research Laboratory has also been free from accidents ordisasters for 19 years since it was launched.
In fiscal 2008, we spent 1,100 million yen on upgrading
facilities and on increasing disaster control equipment for the
purpose of safety and disaster prevention. We will continue tostep up our efforts to protect all workers from accidents, whether
they are employed by Tokuyama or our contractors.

Commitment to Occupational Healthand Safety
Promoting the Safety Management System
Tokuyama has established Occupational Health and Safety
Management Systems for individual factories and offices and, in
fiscal 2003, put them into operation. At the Tokuyama Factory, its
system was upgraded into the Safety Management System in fiscal
2005 to additionally support process safety activities. This factory
continues to make improvements by performing risk assessment interms of work, equipment and processes with a view toward
completely removing potential risk factors. In fiscal 2008, theCompany invested 470 million yen to enhance and strengthen
occupational health and safety.

0.15
0.10
0.05
0.00

1998 1999 2000 2001 2002 2003 2004 2005 2006

2007 2008(Fiscal year)

Source: Ministry of Health, Labour and Welfare Survey on Industrial Accidents

Implementation of Safety and Health Activities inConcert with Contractors
Tokuyama is working to safeguard all workers at its plants from
accidents and injuries in collaboration with its contractors. Specificactivities include efforts to share information and raise awareness throughjoint safety and health meetings and their departmental equivalents withthe participation of Tokuyama’s employees and those of its contractors.
Other activities include enhancing safety checks and management bymeans of safety patrols, purpose-specific safety education and workshops
for increasing knowledge of the personnel and training programs toincrease the level of skill. We strengthened measures to prevent any
accidents involving slipping, after a number of falls occurred in fiscal
2007. As a result, no similar accident took place.

Maintaining a Favorable Working Environment
With the goal of ensuring a comfortable working environment
conducive to good mental and physical health, we take constant measures
to improve working environments where specified chemical substancesand organic solvents are handled. Our industrial doctor inspects theseworkplaces and we take other steps to improve the equipment and theworking methods. At present, all worksites at every factory and office fallunder Control Category I*3. We have introduced tighter voluntary standards
for the purposes of improvement. We have also separated smoking from
non-smoking areas in the workplaces, while noting that the percentage ofsmokers is falling with
■Process Flow of Stress Relief through theeach year. In fiscal 2008,
Use of Occupational Stress Survey Sheets
we interviewed individualOccupational Stress Survey Sheets
personnel to offer health(with 57 questions)guidance on the basis of
To be implemented
the results of occupational
at workplaces
stress checks on a
Analysis of replies to selected questions
concerning health risks attributable to factors
companywide basis, andassociated with the workplacescontinued to offer healtheducation with speakers
Findings on individual workplaces explained by thevisiting individual workHealth Management Center to the managerial staff
places. We also introduced a health improveStudy on measures for improving the working
ment workplace scheme
environment
and took other positive
steps to enhance our
Activities for Improving the Working Environment
working environment.

Terminology *1 The rate of injuries that result in lost work time refers to the number of workers forced into absence through industrial
accidents per million cumulative working hours. This reflects the frequency at which industrial accidents occur.
*2 The accident severity rate refers to the number of lost work days per one thousand cumulative working hours. This reflects themagnitude of industrial accidents that have taken place.
*3 Control Category I refers to the state in which the concentration of hazardous substances in the atmosphere does not exceed the standard control concentrationin most (at least 95%) of workspace units. There are three control categories, namely I, II and III. Control Category I corresponds to the most desirable condition.

Tokuyama CSR Report 2009

Site Report

Process safety activities in the Manufacturing Department 1 of
the Chemicals Business Division have two key elements. The first isobserving the basic rules. Tokuyama has laid down five provisions
for workers’ actions. These provisions have been developed fromincidents that have actually occurred in the past. We should
perform a self-check on a monthly basis to habitually conduct theactions specified. The second key element is the Safety Day
initiative. On the first working day of each month, an event for
raising safety awareness is held, such as a drill for installing an
on-site command post. Through these actions,
we will inculcate safety consciousness into
individual workers and maintain our noaccident and no-disaster status.

All industries

Harmony with the Environment

Observing the basic rules and the Safety Day initiative

2.5

Harmony with Society

Voice■Trend in the Rate of Injuries Resulting in Lost Work Time*¹

Tokuyama’s CSR Activities

Tokuyama believes that safety is an essential part ofbusiness activities and that ensuring safety is the firststep in achieving coexistence with society. In taking
this stance on safety, Tokuyama thoroughly conducts
process safety and disaster prevention activities as wellas occupational health and safety efforts. With the aimof preventing accidents and injuries, the Company isstriving to provide a favorable working environment.

Tokuyama conducts audits of all its factories and offices toinspect the status of process safety, disaster prevention andoccupational health and safety. If the audit identifies any
nonconformance, it is specified and the necessary guidance isgiven to ensure corrective action. The audit results are reported to
relevant departments so that they will implement remediation.
The Safety Measures Committee is also informed of the results sothat it can formulate an action policy for the following fiscal year
on the basis of the findings.

Special Feature

Process Safety,
Disaster Prevention
and Occupational
Health and Safety

Tokuyama has three safety principles. According to theseprinciples, safety is, in the first instance, a social responsibility to
be met as a corporate citizen. Second, safety is given priority over
all other business activities; and third, security can be achieved by
the fact that all staff members have a responsible attitude andengage in responsible activities.
The Company’s main factory, the Tokuyama Factory, is locatedvery close to the residential district of the city. We understand that
it is absolutely essential to ensure safe operation of the factory andwe make painstaking efforts to ensure safety of the equipment andthe processes. Such efforts include, for example, safety patrol
operations, Kiken Yochi (KY) activities for hazard prediction,
Hiyari Hatto activities for accident control, the five-S activities*1
and the practice of pointing and calling a name out loud. These
basic activities are strictly practiced with consistently risingintensity. For the purpose of risk and crisis management, we
employ a safety management system and improve the safety
management level in a plan-do-check-act cycle to prevent
accidents and disasters.
In preparation for any unexpected crisis, we review andupgrade our disaster prevention system, including the structure,communication, disaster control activities, materials andequipment for disaster prevention and rescue and first-aid
operations. Building on work done in the previous year, in fiscal
2008, we added gate security cameras, introduced new security
cameras for monitoring the premises, and increased the numberof automated external defibrillators (AEDs). We did this to tighten
gate access and security on the premises and to enhance ourreadiness for emergency situations.
We also conduct a number of different drills. These specifically
include general disaster drills jointly held with the public sector,
departmental disaster drills, emergency drills organized incollaboration with affiliated and contractors, competitions in disaster
control skills held on the factory’s premises, and rescue and first-aid
drills with the mustering of fire control personnel. These drills focus
on the active use of materials and equipment for disaster prevention
and on smooth links with headquarters, designed to boost thecapability to cope with disasters as they happen.
The general disaster drills
take place in full view of
local residents so that they
will be able to understandand place their trust in the
security activities of thefactory.

Safety Audit

36

Harmony with
the Environment
Performance for
Fiscal 2008

Environmental
Accounting

Tokuyama strives to obtain accurate data on inputs
and outputs in its business activities and reduce theburden on the environment to meet its new goals.

To facilitate understanding and analysis of how
much is invested in and spent on environmental
preservation and for thus improving the effectivenessof environmental investment, Tokuyama has been
implementing environmental accounting since fiscal
2000.

* All figures represent the input and output amounts associated with Tokuyama Corporation alone in fiscal 2008.

（52,800,000GJ）

CO2

INPUT

Production Activity

(CO2)

6,850

OUTPUT(incinerated and land-fill)

21
Environmentalload materials
12
Process effluent
22,900

Products
6,660(Coolant water andother types of effluent)(Unit: 1,000 metric tons)

In fiscal 2008, our investment in the environment declined
about 400 million yen from a year earlier and the economic
benefits dropped some 200 million yen. Total spending roseabout 300 million yen.

¥

Environmental Costs

Atmosphere

Soot and Dust

(Reference Fiscal Year: 2007)(Reference Fiscal Year: 2007)±0%(Maintaining the levelattained in the three
preceding years)–36%

Rating*○Fiscal 2010 Target(Reference Fiscal Year: 2007)(Reference Fiscal Year: 2007)±0%(Maintaining the levelattained in the three
preceding years)±0%(Maintaining the levelattained in the three
preceding years)

–7%

–28%

○

–7%

–7%

Nitrogen

±0%

–4%

○

±0%

±0%

Phosphorus

±0%

–35%

○

±0%

±0%

PRTR

–24%

–2%

–24%

–50%

Hazardous Air
Pollutants (VCM, EDC)

–36%

–12%

–8%

–38%

EnergyConservation

Unit Energy
Consumption Index

20% lower than thelevel in fiscal 1990

16.7% lower than thelevel in fiscal 1990

21% lower than thelevel in fiscal 1990

22% lower than thelevel in fiscal 1990

Global Environment
Conservation

Recycling

Rate of Effective
Utilization of Waste

To be kept at 94%

94.1%

○

To be kept at 94%

To be kept at 94%

Waste Reduction

Zero-Emission

Zero-Emission Rate

To be kept at 99.9%

99.9%

○

To be kept at 99.9%

To be kept at 99.9%

Environmental
Impact Reduction

Water Quality

PRTR*Rating: The circle refers to success in attaining of the target and the cross refers to failure to attain the target.

37

Tokuyama CSR Report 2009

Resource Recycling Effective use of resources

Upstream andDownstream Costs
Management Activity
Costs
Research andDevelopment Costs
Social Activity Costs
Costs for Environmental
DamageTotal

Installation of environmental
analysis equipment

Planting in the factory
premises and production of
CSR Report
Contribution andmanagement of the former
mining site

(JPY million)

Total
AmountSpent(JPY million)

Remark(JPY million)–

202

Gains on the Sale ofValuable Waste

84

610

Gains on Waste Treatment
Cost-Cutting

236

398

Gains on Raw Materials andFuel Cost-Cutting by Reusing Waste

237

428

Earned by reducing theamount of electricity andsteam consumed
Earned by selling scrap
metal, waste oil, waste acidand alkali, and suchlike
Waste treatment costs
slashed by reusing waste

1,638■ Trend in Cumulative Total Environmental Investments (since fiscal 1990)(JPY 100 million)
350
300

272

282

300

314

246

200
150
100

1,252

4,077

50
0

2004

2005

2006

2007

2008

(Fiscal year)

70

904

5

1,184

0

0

37

290

0

15

2

22

1

173

1,367

6,665

Site Report

COD

Costs in the Business Areas

Items

Fiscal 2009 Target

Installing combustion
abatement systems, replacing
catalyst for denitration
Pollution Control
equipment, and replacing
internal units for electric dust
collectors
Global Environmental Modifying energy
Conservationconservation systems

AmountInvested

Economic
Benefits

Harmony with the Environment

Segment

Fiscal 2008 Result

Principal Actions(thousandmetric tons)

Gains on Reduction in
Energy Consumption

250■ Costs of Environmental Preservation
Classification ofEnvironmental
Preservation Costs

Material
Benefits

Total

Nearly 60% of Tokuyama’s environmental investment wasappropriated to pollution control and less than 20% to global
environment conservation and to actions relating to resource
recycling each. The major targets of our environmental
investments include installing combustion abatement systems
and replacement of internal units for electric dust collectors.

Results of Environmental Preservation Activities in Fiscal 2008 at the Tokuyama Factory
Fiscal 2008 Target

Item

Harmony with Society

Industrial water
40,600Carbon dioxide

Waste materials

Tokuyama

Raw material
7,080■ Economic Benefits

TopicsWaste andby-products
1,785
Fuel
2,000

To analyze the economic benefits, we calculate nothing but thereal benefits of gains on reduction in energy consumption, gains on
the sale of valuable waste, gains on waste treatment cost-cutting
and raw materials and fuel cost-cutting by reusing waste. Assumed
economic benefits are not included in the estimates. In fiscal 2008,
we reaped 1.6 billion yen worth of economic benefits, downaround 0.2 billion yen from the preceding fiscal year.

Tokuyama’s CSR Activities

Flow of Materials in the Business Activities

Economic Benefits
Special Feature

One of our most important corporate social responsibilities
is to protect the global environment.
Tokuyama practices environmental management with anemphasis on environmental perspectives in all of its businessactivities.

* The data in the table shown above are based on Environmental Accounting
Guidelines 2005 published by the Ministry of the Environment.
* The figures reflect the amounts incurred at all factories and offices of Tokuyama
Corporation.

Tokuyama CSR Report 200938

Harmony with the Environment■ Trend in the Unit Energy Consumption Index (Tokuyama Factory)
Reduction rate (%)
0

–5

–10

–15

–16.9

–20

–16.7

–18.1
‒18.1

–19.1

–19.2

2005

2006

2007

(Target)
（目標）
–22

–25

1990

2004

2008

2010

(Fiscal year)

TopicsIn fiscal 2008, unit energy consumption was 16.7%
below the 1990 level due to production decrease.
● The cumulative total number of applications for the
program to encourage anti-global warming initiatives
since the program launch has exceeded 20.
●■ Trend in Energy Consumption(thousand GJ per year)

Tokuyama Corporation
Group companies

2,800
2,800

3,400
3,400

3,800
3,800

3,700
3,700

50,00053,10053,90054,20055,800

2004

2005

2006

40,0002,700
52,800Tokuyama takes part in the Cool Biz campaign that began asa national movement in the summer of 2005. In addition to ourconventional energy conservation efforts at our offices, we haveencouraged our employees to work in light clothing andintroduced thorough temperature control of the air
conditioners. As a consequence, Tokyo head office managed tokeep its power consumption during the four-month period from
June to September 2008 nearly at the level a year earlier.

2008■ Cool Biz Benefit (At the Tokyo head office from June to September)

38,10030,00020,00010,000

Promotion of Energy Conservation

Tokuyama CSR Report 2009

■ Trend in CO2 Emissions

7,000(Fiscal year)

Generated from fuels
Generated from raw materials
Group companies(thousand metric tons)
8,000

2007

220
220

170
2,290

200
2,350

2,130

2,100

4,800

4,910

4,960

5,130

230

160
2,000

6,000
5,000

1,960

4,850

4,000
3,000

500
400

Voice

419
358

300

336

336

340

200
100

3,350

0

2,000

2004

2005

2006

2007

2008

(Fiscal year)

1,000
0

(thousand kWh)

1990

2004

2005

2006

2007

2008

(Fiscal year)

Note on the Diagrams: The Tokuyama Plant of Sun·Tox Co. Ltd., constituted partof Tokuyama Corporation in fiscal 2004 and earlier years. From fiscal 2005
onwards, it is counted as a group company.

Raising individuals’ awareness of environmental friendliness
There are today many products designed to help stop global
warming without inconveniencing users in the housing,automobile, home electronics, and other fields. In addition, it
seems clear that interest in environmental friendliness is growing
rapidly as tax relief and other incentive programs are introduced.
In these circumstances, action taken in our offices to protect
the environment include the casual attire campaign known as
Cool Biz, careful control of air conditioning temperatures,
specifically 28 degrees Celsius in summer and 18 degrees in
winter, self-restraints on the use of elevators (in which we areencouraged to use stairs when moving up one level or two or
down one, two, or three levels) and turning off lights. Instead of
depending on improvements in facilities, we strive to raise
environmental awareness among individual staff members andpublish the consumption facts and otherdata as part of a sustained program ofenvironmental activities.

Site Report

39

1990

Harmony with the Environment

Tokuyama consumes a huge amount of energy in theprocesses of manufacturing its core products, such as caustic
soda, cement and polycrystalline silicon. Carbon dioxide, oneof the greenhouse gases, is generated chiefly by burning fossil
fuels and also by the decarboxylation of limestone used as araw material in the cement production process.
Aware of the high priority of preventing global warming, theCompany is conducting energy conservation activities toreduce carbon dioxide emissions. The Tokuyama Factory is
responsible for more than 99% of the Company’s energy
consumption. Its unit energy consumption in fiscal 2008 fell
2.5% from the preceding fiscal year, to a level that is 16.7%
below the 1990 level, reflecting a decrease in production
associated with the economic slowdown.
In fiscal 2008, the Cement Manufacturing Dept. and the
Manufacturing Dept. 1 and 2 of the Chemicals Business Div.
worked together on a project to improve unit energy
consumption. They developed a program for energy efficiency
improvement equivalent to a 0.5% reduction in energy
consumed in the factory, or to a reduction in CO2 emissions ofnearly 40,000 metric tons per year. In fiscal 2009, the Si
Manufacturing Dept. and the Steam & Power Generation Dept.
have joined the three departments mentioned above tocontinue with this initiative.
We will be making efforts to improve with a goal of attaining
unit energy consumption that is 22% lower than the 1990 levelby fiscal 2010.
We also take part in the Initiative to Develop the Hydrogen
Frontier Yamaguchi. The Hydrogen Town Model Project
employs hydrogen supplied from our plant, which is piped
directly to general households.

0Efforts at Our Offices

Tokuyama has a basic policy of pursuing management inharmony with society. In accordance with this policy, theCompany is stepping up its environmental, energy conservationand social contribution efforts in an effort to create asustainable society.
As part of the project to mark our 90th year in business, a
program to encourage anti-global warming initiatives waslaunched in April 2008.
This program covers part of the costs incurred by employees
purchasing and installing specific environmentally friendly
products closely related to the Tokuyama Group’s business,
namely the plastic window sash for residential use and the solar
power generation system. Its objective is to help reduce CO2
emissions in the household sector by raising awareness against
global warming and by encouraging householders to conserve
energy. The program is open to all employees of the TokuyamaGroup and applies to any of the specified products irrespectiveof the make.
To continuously increase awareness of the program within
the Group, we present the program in our in-house magazine
and intranet to encourage our personnel to take advantage ofthe public support program. These internal media communicate
a wide range of information on global warming to ensure thatthe issue is better understood by the Group’s employees.
Since it was launched, the program has attracted more than
20 applications. This shows the high level of interest in theseenvironmentally friendly products. It is hoped that the launch ofthis program will help to cultivate environmental awarenessamong the Group’s employees on an ongoing basis.

Harmony with Society

60,000Program to Encourage
Anti-Global Warming Actions

Tokuyama’s CSR Activities

Prevention of global warming is a key challenge to beaddressed by corporate citizens. Tokuyama makes
constant achievements through the conservation ofenergy in business activities and supports theconservation of energy in employee households.

In supplying the Shanon plastic window sash, silica forenergy-saving tires and other products, the Tokuyama Grouphas been helping to reduce the emissions of CO2 in the
consumer and transportation sectors, in which CO2 emissions
have significantly increased. The Shanon is a powerful tool forenergy conservation in residential houses. We focus our efforts
on technical developments that contribute to trend towardanti-global warming, including the construction of averification plant for polycrystalline silicon for solar cells andthe development of electrolyte membrane for fuel cells etc.

Power consumption

0

Contribution to Action
against Global Warming In the Consumer
and Transportation Sectors

Special Feature

Commitment to thePrevention of Global
WarmingKenji Hirano

General Dept.,
General & Personnel Affairs Div.

A meeting for reporting the efforts under the initiative for improving
unit energy consumption at the Tokuyama Factory on December 18, 2008

Tokuyama CSR Report 200940

Harmony with the Environment

Waste incinerators, waste oil incinerators and part of the vinyl
chloride monomer manufacturing facilities are subject toregulations under the Special Measures Law for Countermeasuresagainst Dioxins. The measured dioxin concentrations in flue gas
and wastewater remain far below the control levels.

Reduction of Air andWater Pollutants

Hazardous Air Pollutants Emissions
Tokuyama sets out a voluntary reduction plan for four
substances that it produces among the 12 substances subject tovoluntary control in accordance with the Air Pollution Control Law,
including chloroethylene, to take continuous action. In fiscal 2008,
the emissions stood at nearly the same level as in the preceding
fiscal year, despite the slide in the system operation ratio. This isdue largely to malfunctions of the combustion abatement systems.

267
267

259

223
2,890
2,890

4,000

1,720

2,000
1990

2004

350
300
250

6,000

0

10,100

200

161

150

2,310

1,940

1,930

1,190
1,190

2005

2006

2007

2008

100
0

(Fiscal year)

PRTR Substances Emissions

Tokuyama Corporation
Group companies

150
100

98

110

0

41

100
68

50
1998

2003

2004

Tokuyama CSR Report 2009

100

100
60
2005

65
2006

0

17

28
1995

2004

25
12

2
5

9

1
3

2005

21
8
9

1
3

2006

30

31

13

11
12

2
3

12
2007

4
4

2008

(Fiscal year)

Industrial Effluent and Water
Pollutants Emissions

70

82

2007

145

30

153

10

0

21.2

166

21.4

23.0

24.9

22.9

100

50

2004

2005

2006

2007

2008
(Fiscal year)0■ Nitrogen and Phosphorus Emissions (metric tons)
70
29
2008

(Fiscal year)

Nitrogen emissions
Phosphorus emissions

2004
94
7.8

2005
95
4.0

2006
110
3.9

2007
112
4.5

Terminology *1 The pollutant release and transfer register (PRTR) refers to a system of collecting and publishing data on the sources of hazardous
substances, the amounts of such substances emitted into the environment or carried away from business establishments in the form inwhich they are contained in waste.
*2 Chemical oxygen demand (COD) is an indicator of the water pollution level and refers to the amount of oxygen consumed byoxidizing organic substances in water.

99.9

99.9

99.9

93.9

94.3

94.1

94.1

82.4

15,0000

Zero-Emission Rate (%)

76.9

1990

(%)
100
95
90
85

Landfill Volume (metric tons)

20,0005,000(5.8%)

630

680

520

520

2004

2005

2006

2007

80
75

Effective Utilization Rate (%)(Unit: thousand metric tons)

70
65
480

2008

60

(Fiscal year)

Landfill

0.5

Effective Utilization＝
Rate (%)(0.1%)
Total waste
generation
Internal Recycling (into materials

Effe

Recycling Volume(internal and external)

Total Waste Generated

100

Landfill Volume(internal and external)
Zero-Emission
1−＝
Rate (%)
Total Waste Generated

345

100

304

cti
ve

Ze
ro

％
4.1
Utilization Rate 9(88.1%)

％

9.9
-Emis
sion Rate 9■ Process Flow of Industrial Waste Treatment
Incineration(internally)

Landfill(internally)

19.0

Incineration(externally)0

Waste generated

1.0

Landfill(externally)

0.5

Waste generated

345

22.0

Internal Recycling
2008
108
2.9

94.3

30,00025,00099.8

10,000(6.0%)

150

14.3

1990

20.5

99.8

36,26035,00020.0

External Recycling

and fuels for reuse)120
20

40,000Incineration(metric tons)
200
157(metric tons)■ Breakdown Graph of Industrial Waste Treatment in Fiscal 2008

At the Tokuyama Factory, the hydrogen ion concentration (pH)and the suspended solids (SS) concentration in industrial effluent
are under strict control. The Kashima Factory contracts with aterminal treatment plant to treat its effluent. To treat process
effluent that contains organic substances, activated sludge processequipment has been installed to reduce the chemical oxygen
demand ( COD)*². Since fiscal 2004, our measurements havebeen covering nitrogen and phosphorus as well. They are subject
to total volume control under the Water Pollution Control Law.
In fiscal 2008, a decline in operation in the facilities resulted ina reduction in both nitrogen and phosphorus emissions.
(million metric tons)
40
180■ Trend in Waste Landfill Volume, Effective Utilization Rate and Others

Landfill Volume

20

33
9

7

In fiscal 2008, Tokuyama generated 345 thousand metrictons of waste. It actively recycled them internally andexternally, mainly reusing them as cement raw materials andfuel at the Tokuyama Factory. Packing materials, pallets andother wood waste were crushed into fuel so that they can beeffectively used at power plants. As we worked diligently torecycle waste into raw materials for cement, we maintained therate of effective use of waste at 94.1%. We stepped up ouractivities for reusing and reducing waste to achieve a highlandfill zero-emission rate of 99.9%.

Site Report(metric tons)
200

40

47

COD emissions■ Trend in PRTR Substance Emissions
237

60

Dichloromethane (methylene chloride)■ Trend in Industrial Effluent and COD Emissions

Twenty-seven substances among those handled by Tokuyama
in fiscal 2008 are subject to notification under the Pollutant
Release and Transfer Register (PRTR)*1 legislation. In fiscal
2008, emissions reduction measures were introduced at
different worksites, but total emissions remained unchanged as
the systems were started up and stopped more frequently.

250

Chloroform

80

Industrial effluent

272
272

11,100
11,1001,2-dichloroethane

21

Harmony with the Environment

Sox / Nox emissions

11,40011,400

Soot emissions

275
275

8,000

400

12,300100

Harmony with Society(metric tons)

Chloroethylene (polyvinyl chloride)

103

Effective Utilization Rate / Zero-Emission Rate

(metric tons)
11,50011,500As a result of its exhaustive efforts to reduce waste
and recycle, in fiscal 2008 Tokuyama put 94.1% of
its waste to effective use and diverted 99.9% of its
waste from being dumped in landfills.

Waste Management

120■ Trend in SOx, NOx and Soot Emissions

10,000The Tokuyama Group has 82 transformers and capacitors
containing polychlorinated biphenyl (PCB)*³. All of them havealready fallen into disuse. In compliance with the Special
Measures Law for the Proper Treatment of PolychlorinatedBiphenyl Waste, they are retained and managed in an
appropriate manner. Legislation requires all PCB waste to havebeen treated by July 2016. In accordance with the plan of thenational government, wide-area PCB treatment facilities are
increasingly constructed and coming into operation insuccession. Taking advantage of the early registration program,
the Tokuyama Group finished its registration to the Japan
Environmental Safety Corporation (JESCO) in December 2005.
In the future, we will be properly treating our PCB waste in linewith the timetables of the wide-area treatment project inseparate districts.

Tokuyama’s CSR Activities(metric tons)

We have added a flue gas desulfurizer to every boiler inTokuyama’s in-house power generation facility to reduce sulfur
oxides (SOx) emissions. In fiscal 2008, our environmentallyfriendly in-house power generation systems stayed in operation
to cut SOx emissions. To reduce nitrogen oxides (NOx) andsoot emissions, we have equipped boilers and cement kilns,
which generate NOx and soot, with denitration equipment, low
NOx burners and high-performance dust collectors. In fiscal
2008, we achieved a reduction in NOx emissions as well assoot emissions as a result of stable facility operation.

10,000Management and Treatment of PCB Waste■ Trend in Hazardous Air Pollutants Emissions

Air Pollutants Emissions

12,000Waste Reduction
and Recycling

Special Feature

Tokuyama has always adopted a broad array ofmeasures on a continuing basis to reduce air, waterand other environmental pollutants. In fiscal 2008,
we successfully lowered emissions of smoke, soot,and water pollutants.

14,000Anti-Dioxin Measures

304

Inside theCompany

Outside theCompany

External Recycling

20.5*The figures represent relevant values for fiscal 2008 (Unit: thousand metric tons).

*3 Polychlorinated biphenyl (PCB) is an organic chlorinated compound that emits dioxins when burnt in low temperature. Chemicallystable and excelling in thermal resistance, chemical resistance, insulation and other electric characteristics, it was formerly used inmany different electric products including transformers and capacitors. However, it has been banned from production or utilization
since 1972 because of its hazardousness to humans. Transformers, capacitors and other PCB-contained products that have alreadybeen distributed have to be retained at business establishments.

Tokuyama CSR Report 200942

Harmony with the Environment

Development of Environmentally Friendly
Products and Environmental Technologies

Ion Exchange Membranes ASTOM Corporation

The Tokuyama Group maintained its efforts to develop environmentally friendly products and recycling technologies
in fiscal 2008.

Development of an Electrolyte Membrane for Alkaline Membrane Fuel Cells

Voice
Toward developing materials with high performanceand high economic efficiency
The use of alkaline electrolytes as electrolyte materials
central to fuel cells is expected to widen the options offuels and catalysts and to enhance environmental features
as well as performance. As this is an unprecedented
project, there are still unknown factors and issues toaddress. However, I feel both pride and a sense of
responsibility in being involved in the development of theelectrolyte material for alkaline membrane fuel cells.
In the future, I will continue to work hard to develop
high-performance and low-cost materials in an attempt tomake environmentally friendly batteries
available to many people as soon as
possible.

Kazuyuki Sadasue

A Closed System for Developers
Material Recycling for Used Developers

43

Tokuyama CSR Report 2009

■ The Closed System for Developers at Sharp
Corporation’s Mie Plant

Undiluted
Developers

DilutionandPreparation
Equipment

Photolithography
Process
Used
Developers

Tokuyama(Dedicated Plant)

Used Developers

Recycling
Equipment
Sharp Corporation’s
Mie Plant

High-Performance Plastic Window Sashes Converse Energy and Reduce Household CO2.
Excel Shanon Corporation, one of Tokuyama’s group companies,
manufactures and sells the Shanon Window plastic window sashes
with distinguished levels of airtight, thermal insulation, sound proof,
and moisture condensation proof characteristics. In 2008, it was
revealed that individual authorization for fireproof/fire-resistantspecifications had been obtained for certain models in the series,
specifically the fireproof/fire-resistant grade models, in the dishonest
way using test products with specifications that differed from thosethat received the authorization. This event severely betrayed theconfidence of customers and many other stakeholders. We arecommitted to regaining trust by improving and repairing the products
involved as soon as possible and by adopting comprehensive
measures to prevent any recurrence. We then hope to shift the focus
of our activities back to fulfilling our primary mission, namely
contributing to energy conservation (reducing CO2 emissions) inhouseholds and enabling comfortable and healthy lifestyles.
The residential housing industry has been taking broad measures
to combat global warming. Among these measures, plastic window
sashes draw attention for their superior performance in reducing
energy consumption, as they add a high level of air-tightness andthermal insulation when used in residential houses. In April 2008,
Excel Shanon released the Triple Shanon, which boasts the lowest K
value of 1.23 W/m2k in the Japanese window sash market. The
K value*¹ is a heat transmission coefficient. A lower figure means
higher heat insulation performance. With the Triple Shanon,electricity costs are about 15% lower*2 than they are with ordinary
aluminum-plastic composite window sashes. This product helps
achieve further reductions in CO2 emissions.

■ A Cross-Section View of the Window Sash

Terminology *1 The K value is the heat transmission coefficient and represents the heat insulation performanceof the wall, floor or other parts of the building.
*2 The expression, “15% lower,” is based on the new reference rate for electric power set by theHome Electric Appliances Fair Trade Conference under the SMASH simulation program.

Triple Glazing
Indoor Side

Outdoor Side

Value
Heat Insulation
PerformanceSpacerTPS

The Shanonplastic window sash

Triple glazing including
two Low-E glasses(with argon gas)

Site Report

Tokuyama and Sharp Corporation finished developing material
recycling technologies for used liquid developers in liquid crystal panel
plants. A closed system to collect, recycle, and reuse developers solutions
between Sharp Corporation’s Mie Plant in Taki-gun, Mie Prefecture andTokuyama’s dedicated plant commenced commercial operation in April
2005. Prior to this inauguration, we had conducted a demonstration trialthat lasted about three years at a pilot plant to identify and address
practical issues from a number of different perspectives. As a result, thesystem has been enjoying very robust operation over the past four years.
Going forward, we aim to improve the technologies and reduce costs
so that they can be used without anxiety, not only by liquid crystal panel
manufacturers but by many other developer users as well. We are also
developing product manufacturing and disposal technologies that have
low environmental impacts right through the supply chain, encompassing
the production use and disposal by manufacturers and users of developers.

Excel Shanon Corporation

Harmony with the Environment

Senior Research Chemist,
Corporate Development Dept. (Tsukuba),
Research & Development Div.

The Triple Shanon Plastic Window Sash

The ACILYZER high-performance electrodialyzer
based on ion exchange membranes

Harmony with Society

Tokuyama achieved a world first when it developed an electrolyte
membrane for alkaline membrane fuel cells. This type of fuel cell has
mainly two advantages. First, a wider array of metals, including iron or
nickel, can be used as electrode catalyst and it is no longer necessary to use
platinum, the reserve of which is limited. Second, biologically produced
ethanol can be used as fuel. Development initiatives for alkaline membrane
fuel cells are underway in different parts of the globe as they are regarded
as environmentally friendly fuel cells for vehicle-mount and otherapplications. The alkaline electrolyte membrane that we have developedfeatures dramatically improved performance supported by enhanced ion
conductivity and thickness reduction. We have begun supplying thismembrane in rolls.
We have also succeeded indeveloping an ionomer to be used
as an electrode catalyst for fuelcells. Combined with theelectrolyte membrane, it has paved
the way for an output of 300
mW/cm2 or more. In the future, wewill contribute to practicalapplication of fuel cells as apioneer in alkaline electrolyte
The alkaline electrolyte membrane andthe ionomer solution developed by Tokuyama
membranes.

Tokuyama’s CSR Activities

For Next-Generation, Environmentally Friendly Fuel Cells, and an Ionomer Additionally Developed

ASTOM Corporation, a Tokuyama Group company, helps resolve
environmental problems with its separation technology based on the
NEOSEPTA ion exchange membranes and the ACILYZER
high-performance electrodialyzer incorporating NEOSEPTA. Ion
exchange membranes facilitate the selective permeation of positive
and negative ions dissociated in solution. Traditionally, ion exchange
membranes have been used in salt production, food, fresh water
generation, pharmaceuticals and the treatment of waste liquids.
Today, ion exchange membranes have application in the separationand collection of acid and alkali in waste liquids, the treatment ofleachate at waste disposal facilities and the removal of nitrate
nitrogen from groundwater as part of initiatives to prevent
environmental pollution. Ion exchange membranes are therefore
attracting the attention of the international community as a clean
technology that serves to prevent environmental pollution.
In fiscal 2008, our separation technology was adopted as an
approach to process improvement and reduction in waste liquid
treatment load at food and chemicals plants. Given that thistechnology is increasingly being recognized as an environmentallyfriendly technology in Japan and overseas, we will be accelerating
our efforts with a view to expanding overseas.

Special Feature

Clean Technologies that Help Prevent Environmental Pollution

K value = 1.23W/m2k

Tokuyama CSR Report 200944

Site Report
Kashima Factory

Location:
1-1, Mikage-cho, Shunan, Yamaguchi Prefecture
Employees:
1,638
Factory Area: 1,910,000 square meters (total area)

Location:
Employees:
Factory area:

26, Sunayama, Kamisu, Ibaraki Prefecture
78
101,000 square meters

Main Products

Tokuyama Corporation’s Kashima Factory

Seiichi Shiraga

General Manager ofTokuyama Factory, andManaging Director

Main Products Cement, inorganic and organic chemical products, polycrystalline silicon,

silica, vinyl chloride and others■ Performance Data
Fiscal 2005

Fiscal 2006

Fiscal 2007

Fiscal 2008

1,720
11,500
272
50.1
21.1
141
94
7.8
66
395
610
53,000
4,800
5

2,310
11,400
259
49.5
21.3
152
95
4.0
57
349
660
53,900
4,910
5

1,940
12,300
267
45.8
22.8
148
110
3.9
63
360
480
54,100
4,960
3

1,930
11,100
223
41.1
24.8
161
112
4.5
67
363
480
55,700
5,130
6

1,190
10,100
161
40.6
22.8
116
108
2.9
66
344
460
52,7004,840
0Substance

0.0
11.5
10.9
6.8
3.6
2.7
0.0
1.8
0.7
0.4
0.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
45.3
38.7

Tokuyama CSR Report 2009high-purity recovery was possible, began in fiscal 2005. Today, the Kashima
Factory performs material recycling for six types of waste solvent. In fiscal
2007, material recycling to recover iodine from waste fluid containing iodine
compound commenced. This was followed in the next fiscal year by material
recycling of waste silica gel. In fiscal 2008, the rate of effective utilization ofwaste was the same as the 73% registered in the preceding fiscal year.
●Tokuyama Dental Corporation has changed the materials for some products

from dichloromethane to water-based materials. It is endeavoring to expand
this material shift to other products to reduce dichloromethane emissions
into the atmosphere.

■ Performance Data (in total of two companies)
Unit

Unit: metric tons
(mg-TEQ for dioxins only)

Emissions
To Water
To Soil

24.7
0.0
0.0
0.0
0.0
0.0
2.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
3.3
27.1

The substances are listed in descending order of emissions and, for substances that were not emitted at all, in order of government ordinance number.
Emissions to Water refers solely to the emissions released into public waterways.
Displacement refers to the combination of the quantity displaced to sewerage and the quantity subject to intermediate treatment.
Total shows the value rounded to one decimal place after adding the values to three decimal places.

45●At the Kashima Factory, material recycling of solvent, from which relatively

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

Subtotal

24.7
11.5
10.9
6.8
3.6
2.7
2.4
1.8
0.7
0.4
0.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
48.6
65.8

Displacement

0.0
0.1
0.0
0.0
100.4
0.0
0.0
0.0
2.3
185.6
0.0
0.0
4.2
0.0
2.6
0.0
0.0
0.0
0.0
0.1
0.0
295.3

thousand metric tons
Industrial Water Consumption
thousand metric tons
Effluent
metric tons
COD Emissions
metric tons
PRTR Substances Emissions
metric tons
Waste Emissions
metric tons
Waste Final Disposal Volume
thousand
GJ
Energy Consumption
metric tons
CO2 Emissions (in fossil fuel equivalents)
complaints
Complaints

Fiscal 2004

Fiscal 2005

Fiscal 2006

Fiscal 2007

Fiscal 2008

91
107
4
3
769
29
45
2,180
0

112
126
5
2
749
15
51
2,130
0

110
125
5
3
779
34
53
2,170
0

107
129
5
4
965
32
58
2,320
0

78
95
4
5
770
27
55
2,230
0

■ PRTR Substances Emissions and Displacement by Substance in Fiscal 2008
Substance
Chloroform
Dichloromethane (Methylene Chloride)
TolueneAcetonitrile
Ethylene Glycol
1,4-Dioxane
N,N-Dimethylformamide
Methacrylate
2,3-Epoxypropyl Methacrylate
Methyl Methacrylate
Alpha-Methylstylene
Total

Government
Ordinance Number

95
145
227
12
43
113
172
314
316
320
335

To Air

2.2
1.8
1.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
5.4

Unit: metric tons

Emissions
To Water
To Soil

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

Subtotal

2.2
1.8
1.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
5.4

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

Displacement

23.9
6.9
9.6
2.5
2.8
0.1
15.7
0.0
0.0
0.0
0.0
61.7

Site Report

67
116
77
96
227
145
1
95
56
135
112
13
16
43
207
253
270
283
299
304
179

To AirDental materials (restorative materials, adhesives, denture
relining materials, impression materials, plaster materials
and investment materials)

Harmony with the Environment

Cresol
1,2-Dichloroethane
Chloroethylene (Polyvinyl Chloride)
Chloromethane (Methyl Chloride)
TolueneDichloromethane (Methylene Chloride)
Water soluble zinc compounds
Chloroform
1,2-Epoxypropane (Propylene Oxide)
1,2-Dichloropropane
Carbon Tetrachloride
2,2’-Azobisisobutyronitrile
2-Aminoethanol
Ethylene Glycol
Water-soluble copper salt (excluding complex salt)
Hydrazine
Di-n-Butyl Phthalate (DBP)
Hydrogen Fluoride and its water soluble salts
BenzeneBoron and its compounds
Dioxins
Total (excluding dioxins)

Government
Ordinance Number

Tokuyama Dental Corporation’s Kashima Plant

Harmony with Society

Fiscal 2004

■ PRTR Substances Emissions and Displacement by Substance in Fiscal 2008

General Manager ofKashima Factory

Tokuyama’s CSR Activities

SOx Emissions
NOx Emissions
Soot Emissions
Industrial Water Consumption
Effluent
COD Emissions
Total Nitrogen Emissions
Total Phosphorus Emissions
PRTR Substances Emissions
Waste Emissions
Waste Final Disposal Volume
Energy Consumption
CO2 Emissions (in fossil fuel equivalents)
Complaints

Unit
metric tons
metric tons
metric tons
mil. metric tons
mil. metric tons
metric tons
metric tons
metric tons
metric tons
thousand metric tons
metric tons
thousand GJ
thousand metric tons
complaints

Shingo Matsuoka

Pharmaceutical bulks (X-ray contrast agents, stomach andduodenal ulcer treatment drugs); optical materials (plastic lensmonomer, light modulating materials, hard coat solutions);
materials for electronic materials and metal washing solutions* For further details about the factory, see page 13.

Special Feature

Tokuyama Factory

The substances are listed in descending order of emissions and, for substances that were not emitted at all, in order of government ordinance number.
Emissions to Water refers solely to the emissions released into public waterways.
Displacement refers to the combination of the quantity displaced to sewerage and the quantity subject to intermediate treatment.
Total shows the value rounded to one decimal place after adding the values to three decimal places.

Tokuyama CSR Report 200946

Sun·Tox Co., Ltd. Tokuyama Plant
Sun Arrow Chemical Co., Ltd. Tokuyama Plant
Tokuyama Polypropylene Co., Ltd.

Site Report Activities of Group Companies■ ISO 9001 and ISO 14001 Certification Status of Eleven Group Companies
Group Company
Sun∙Tox Co., Ltd.

ISO9001

ISO14001●●

Excel Shanon Corporation●

̶

Tohoku Shanon Co., Ltd.

●●A&T Corporation●●

Figaro Engineering Inc.

●●

Tokuyama Dental Corporation̶＊●Tokuyama Siltech Co., Ltd.

●●Sun Arrow Chemical Co., Ltd.

̶●ASTOM Corporation●●

Shin Dai-ichi Vinyl Corporation̶●Tokuyama Polypropylene Co., Ltd.

●●

Tokuyama Plant 1-2, Harumi-cho, Shunan, Yamaguchi Prefecture
Employees: 27
Area: 3,280 square meters■Performance Data
Unit

＊Certified with ISO 13485● = Included in the certified sites

Shigefumi Kunihiro

Kanto Plant Location: 3075-18, Shimasu, Itako, Ibaraki Prefecture

Employees: 148
Area: 24,100 square meters

Toshiyuki Yamaoka

Plant Manager

Plant Manager■ Performance Data

■ Performance Data
Fiscal 2004 Fiscal 2005 Fiscal 2006 Fiscal 2007 Fiscal 2008

Unit

Fiscal 2004 Fiscal 2005 Fiscal 2006 Fiscal 2007 Fiscal 2008

Kl

1,470

910

600

639

745

Unit energy consumption
index with fiscal 1990
as the base year

SOx

metric tons

2.0

0.7

0.6

0.4

0.4

Power Consumption

35,74035,77034,23034,830

NOx
Soot Particles

metric tons

3.3

0.9

0.5

0.7

0.7

0.3 MPa Steam Consumption metric tons

2,610

2,930

4,220

3,410

2,770

metric tons

0.3

0.04

0.03

0.04

0.08

2.1 MPa Steam Consumption metric tons

42,76044,83042,27043,83039,160Industrial Water
Consumption

metric tons

53

63

59

66

77

Waste Emissions

metric tons

80

160

180

200

120

Waste Emissions

metric tons

90

22

52

60

34

Waste Final Disposal Volume metric tons

2

0

1

11

20

Waste Final Disposal
Volumemetric tons

0

0

9

29

5

COD Emissions

metric tons

0.02

0.02

0.01

0.01

0.03

28,47028,48029,73029,21230,600

Heavy Oil Consumption

Tokuyama CSR Report 2009(%)
thousand
kWh

3,210

3,540

3,470

2,810

metric tons

150

172

186

158

157

Effective Used Waste Plastics Volume

metric tons

150

172

186

158

157

Waste Final Disposal Volume metric tons

0.2

0.1

0

0

0.6

Steam Consumption

metric tons

240

240

240

240

240

Industrial Water Consumption

thousandmetric tons

65

65

65

65

65

94

89

87

88

87
31,080Located within the premises of Tokuyama Corporation’s Tokuyama
Factory, the Tokuyama Plant produces polyvinyl chloride compounds forplastic window sashes. While it is common to add lead-based stabilizer topolyvinyl chloride compound, we sought to develop a lead-free formula infiscal 2008 in response to the requests of users.
To protect the environment, we perform statutory monitoring and measuring
activities on a daily basis in compliance with the ISO 14001 standards. We
have achieved positive outcomes, reducing environmental pollutants andcutting energy consumption. Understanding that the plant has a prime duty

Tokuyama Polypropylene
Co., Ltd.

to ensure safety, health, security, and disaster prevention, we carry out
equipment and operation management in compliance with relevant laws
and regulations as well as full-participation Five-S activities, Hiyari Hatto(accident prevention) activities, Kiken Yochi (hazard prediction) training,
and Akafuda (red-tagging) operations. As a result of these activities, we
successfully maintained our zero-accident and zero-disaster record. As amember of the Tokuyama Group, it will place top priority on environmental
and safety considerations and constantly seek corporate development aswell as the coexistence and mutual prosperity with the local community.

Date of Foundation: April 2, 2001
Ownership: Tokuyama Corporation (50%) and Prime Polymer Co., Ltd. (50%)
Head Office: 1-1, Harumi-cho, Shunan, Yamaguchi Prefecture
Business: Manufacture and sale of polypropylene resins and polypropylene compound resins

Tokuyama Plant 1-1, Harumi-cho, Shunan, Yamaguchi Prefecture
Employees: 64
Area: 70,997 square meters■Performance Data
Unit

Plant Manager

Our Tokuyama Plant is located on the premises of the Higashi Plant, whichconstitutes part of the Tokuyama Factory of Tokuyama Corporation. The plant
manufactures and sells 200,000 metric tons of polypropylene resins and 7,000
metric tons of flexible polyolefin resins each year.
This plant runs three systems for safety management, environmental
management, and quality management and undertakes responsible care activities intandem with the Tokuyama Factory.
With respect to safety management, we perform risk assessments of processes,
equipment, and work. We are also introducing the Company-wide Hiyari Hatto
Kigakari (HHK) activities to eradicate accidents and other concerns, part of our aim

Fiscal 2006 Fiscal 2007 Fiscal 2008

thousandmetric tons

410

443

387

417

322

Waste Emissions

metric tons

134
20＊

85

141

0

161
25＊

4

158
16＊

87

79

79

85

98

Waste Final Disposal Volume metric tons

Hiroshi Horii

Fiscal 2004 Fiscal 2005

Industrial Water Consumption

Unit Energy Consumption
Index (Fiscal 2002 = 100)%

＊Year with periodic repairs

Site Report

Located on the premises of Tokuyama Corporation’s Tokuyama Factory, theTokuyama Plant produces 23,000 metric tons of biaxial-oriented polypropylene films
per year. In environmental aspects, we work together with Tokuyama Corporation’s
Tokuyama Factory to address environmental conservation and to carry out ISO 14001
activities. As a Type I Energy Management Designated plant, our plant is continuingwith its efforts to slash manufacturing losses and thereby lower unit energy
consumption. An activity is underway to recycle all manufacturing losses generated.
It obtained certification for the Occupational Health and Safety Management
System in February 2008. Going forward, it will be introducing health and safety
activities centering on risk assessment and developing them into a management
system through a PDCA cycle.
Under the slogan of “Take pleasure in production, be stringent with quality andadhere to safety,” the Tokuyama Plant aims to implement plant management in amanner that earns the trust of society, the customers and employees.

Unit

3,020

Waste Plastics Emissions

Harmony with the Environment

Located in the Itako Industrial Park in Ibaraki Prefecture, the Kanto Plant
produces 25,000 metric tons of biaxial-oriented and cast polypropylene films
per year. As a Type I Energy Management Designated facility, it has been taking
steps to ensure effective energy operation by introducing co-generation systems
and energy-efficient equipment, among other initiatives.
In February 2008, we obtained the Occupational Health and Safety
Management System (OHSMS) certification. We capitalize on our threemanagement systems for the environment (ISO 14001), quality (ISO 9001), andoccupational health and safety to make steady improvements throughout theplant, with the top priority placed on safety.
In fiscal 2008, we added a production line for cast polypropylene films andmade preparations for full operation. In the future, we seek to turn the products
manufactured at this plant into a new pillar of revenues and to make our plant amodel plant in terms of energy conservation and safety practices.

Power Consumption thousand kWhthousandkWh

RC activities of the Tokuyama Plant

Tokuyama Plant Location: 7-7, Harumi-cho, Shunan, Yamaguchi Prefecture

Koji Tanaka

Fiscal 2004 Fiscal 2005 Fiscal 2006 Fiscal 2007 Fiscal 2008

Power Consumption

Harmony with Society

Employees: 186
Area: 55,800 square meters

47

Plant Manager

Date of Foundation: February 14, 1992
Ownership: Tokuyama Corporation (100%)
Head Office: Annex to Tokuyama Bldg. 1-4-5, Nishi Shimbashi, Minato-ku, Tokyo
Business: Manufacture and sale of biaxial-oriented polypropylene films and cast polypropylene films

Sun·Tox Co., Ltd.

Date of Foundation: February 1, 1999
Ownership: Tokuyama Corporation (100%)
Head Office: Kitahama Chuo Bldg., 2-2-22, Kitahama, Chuo-ku, Osaka
Business: Manufacture and sale of polyvinyl chloride compounds

Tokuyama’s CSR Activities● = Certified

Sun Arrow ChemicalCo., Ltd.

Special Feature

Tokuyama understands that responsible care activities should
be conducted on a group-wide basis. The Company has signed
RC management agreements with Tokuyama Group companies
both inside and outside Japan engaging in production activities
to support their activities.
We collect data on the environmental impact of groupcompanies and their safety management indicators and conductsafety and environmental audits at the rate of several groupcompanies per year. By means of these actions, we monitor andenforce RC activities conducted at individual group companies.
The trend of statutory regulations and other information areshared with our group companies.
We also provide our group companies with assistance inacquiring ISO 14001 and ISO 9001 certification.

Sun·Tox Co., Ltd. Kanto Plant

to maintain the zero-accident and zero-disaster status that we have enjoyed for 34
years, since the days when we operated as the Polypropylene Manufacturing
Department.
In fiscal 2008, we became one of four businesses in Yamaguchi Prefecture to win
the prize for encouragement from the Director-General of the Yamaguchi Labour
Bureau. The prize recognized our distinguished safety and health level in the regionand our improvement activities, which were held as an example for others.
In fiscal 2009 as well, we will be stepping up responsible care activities in a bid
to maintain our zero-accident and zero-disaster record, to reduce our environmental
footprint, and to eliminate all customer quality concerns.

Tokuyama CSR Report 200948

Comments from Third Parties

History of Tokuyama’s RC Activities

A Review on Tokuyama’s CSR Report 2009
Eriko Nashioka

Certified Public Accountant and Director of the Institute for Environmental Management Accounting
ProfileA part-time lecturer in environmental accounting and environmental auditing for
the Faculty of Commerce of Doshisha University. After completing her studies inenvironmental management at the Doshisha University Graduate School of Policy
and Management in 1997, she joined the Environmental Auditing Section, theThird Department at the Osaka Office of Century Ota Showa & Co., currently
Ernst & Young ShinNihon LLC, where she worked as a consultant concerning
accounting audits (the Commercial Code, the Securities Exchange Law and the
Small and Medium Business and Investment & Consultation Companies Law),environmental audits and environmental reports. From April 2001 to March 2004,

she was chief researcher in the Enterprises and the Environment project run by the
Kansai Research Center of the Institute for Global Environmental Strategies. In
April 2004, she joined the management of the Institute for Environmental
Management Accounting. She was involved in a number of committees, including
the technical subcommittee on environmental accounting in the Management
Research Committee of the Japanese Institute of Certified Public Accountants andother committees under the Ministry of the Environment and the Ministry of
Economy, Trade and Industry. She is a member of the primary screening
committee for the Environmental Report Award co-organized by Toyo Keizai Inc.

1. Actions in response to the window sash incident
In January 2009, Tokuyama made a public announcement
about misleading activities carried out by a subsidiary inconnection with fireproof plastic window sashes. The incident
itself was most regrettable, given that Tokuyama had recently
made a fresh start toward its centennial after marking the 90th
anniversary of its establishment in 2008. However, the Company
took quick action after the incident was revealed. It immediately
set up an external investigative committee to probe the causes,
published timely reports on its website and took remedial action.
In this CSR Report, the incident is referred to in the Top Message.
The first two pages are dedicated to delivering an in-depth reporton this disgraceful event. Adopting the recommendations of theoutside investigative committee, the Company devised specificmeasures to prevent a recurrence in March 2009. These
measures are reflected in many parts of this report. The Company
deserves high marks for its sincere approach in response to theincident. I see Tokuyama’s strong determination to prevent any
such incident from happening again in the Tokuyama Group
Code of Business Activities instituted in the wake of the scandal.

2. Establishment of the Tokuyama Group
Code of Business Activities
The Tokuyama Group has renewed its recognition of the criticalnature of CSR activities and is determined to redouble its efforts inthis area and improve awareness of the importance of fulfilling its
social responsibility. This stance is symbolized by the establishment of the Tokuyama Group Code of Business Activities and thedevelopment of a number of policies, especially the Responsibilityof Senior Management (see page 1). This demonstrates the strong
determination of the Tokuyama Group. Following the Centennial
Vision announced in fiscal 2008, it has clarified what goals to beachieved. What Tokuyama should do now is to devise specificmeasures to achieve its objective of fulfilling the Tokuyama Group

Code of Business Activities and adopt clear indices and criteria formeasuring its progress as part of management.

3. Developing global CSR efforts
This report has a special feature focusing on Tokuyama
Chemicals, one of Tokuyama’s subsidiaries based in China. At
present, a large majority of the Tokuyama Group’s production
and sales take place in Japan. If the Group steps up its
presence in overseas markets, it will need to take global
initiatives to meet environmental and social challenges. Issues
common to global businesses may need to be addressed, suchas understanding and controlling environmental impacts atoverseas bases, actions toward employees, information
disclosure, and the need to contribute to local communities. It
will be essential to manage the Group’s corporate operations
by prioritizing issues determined from the perspective ofmateriality after identifying what Tokuyama Group’s CSR is allabout and after studying the opinions of stakeholders.

4. Active use of the CSR Report as a tool ofcommunication
I consider this CSR Report to be reader friendly, given thatcolors are smartly used to add visual clarity and that notes ontechnical terms are supplied. More specific descriptions
would help readers better understand the Tokuyama Groupas an enterprise. The report features a number of commentsfrom employees. These comments give readers a glimpse at
the kind of people working at Tokuyama, making theCompany more familiar to them. However, there are so few
comments from people outside the Company that it isdifficult to determine how this well-prepared report was
intended to be used. I would like to see this report actively
used for two-way communications with employees and otherstakeholders.
■ In the process of producing Third-Party Comments

Receiving Comments from Third Parties

Apr.

Renews ISO 9001 certification under 2000 standard
and concurrently extends its scope to the sales sector
Dec.
Undergoes the Responsible Care verification process.
The Tokuyama Factory achieves a Type II zero-accident
record (8.1 million hours for the chemical industry) as
defined by the Ministry of Health, Labour and Welfare
Oct. 2004 Figaro Engineering Inc. acquires ISO 14001
certification.
Oct.
The Kashima Factory becomes the recipient of a prize
presented by the Director-General of Labor Bureau of
the Ibaraki Prefectural Government.
Feb. 2005 The Tokuyama Factory becomes the recipient of a
prize presented by the Director-General of the Agency
of Natural Resources and Energy for Factories with
Distinguished Energy Management (electricity sector).
Mar.
Acquires Yamaguchi Prefecture Eco-Factory
certification for the Tokuyama FactoryJun.
The Tokuyama Factory achieves a Type III
zero-accident record (12.2 million hours for thechemical industry) as defined by the Ministry of
Health, Labour and Welfare.
Sept.
ASTOM Corporation acquires ISO 9001 certification.
Aug. 2006 Shanghai Tokuyama Plastics Co., Ltd. acquires ISO
9001 certification.
Oct.
Tokuyama Mtech Corporation acquires ISO 9001
certification.
Dec.
The Kanto Plant of Sun·Tox Co., Ltd. acquires ISO
14001 certification.
Apr. 2007 Establishes the Corporate Social Responsibility Division.
Jan. 2008 The Tokuyama Factory becomes the recipient of a
prize presented by the Minister of Economy, Trade andIndustry in the Award for Excellent Energy
Management Plant.

Editor’s Notes
This third edition of the CSR Report has been produced with the objective of giving
stakeholders a clearer insight into Tokuyama’s CSR activities.
In this edition, the editing team focused on the quality of the special features and on
extensive coverage of Tokuyama’s CSR efforts. We also expanded coverage of overseas
information.
We would be delighted to receive your frank feedback and suggestions so that we canproduce a better CSR Report in the future.

For inquiries, please contact:

Responsible Care Management Department, Corporate Social Responsibility Division

We have received valuable comments about the problems that we currently face. We will proceed firstwith quick and appropriate actions to deal with the incident involving fireproof plastic window sashes,

Tokuyama Corporation

to regain the confidence of stakeholders and to improve our CSR activities and enhance our corporate

Shibuya Konno Bldg., 3-3-1 Shibuya, Shibuya-ku, Tokyo 150-8383 Japanvalue. We will meanwhile be studying means of using the CSR Report as a tool for interactive

Phone +81-3-3499-8478

communications with stakeholders.

Etsuro Matsui,Managing Director and General Manager of the Corporate Social Responsibility Division

49

Jul. 1991 Global Environmental Issues Committee establishedMar. 1993 Establishes the RC Administration Committee
Mar.
Institutes a voluntary plan for Total Management ofEnvironment, Safety and Quality
Apr. 1994 Acquires ISO 9002 certification for high-purity
isopropyl alcohol
Jun.
Develops product warranty systems, including productand labeling assessments
Apr. 1995 Joins the Japan Responsible Care Council
May 1997 Acquires ISO 9001 certification for cement manufacturing
Sept.
Publishes the first edition of the RC Report
Apr. 1998 Acquires ISO 9001 certification for the manufacturingof dental materials
Dec.
Acquires ISO 9001 and 9002 certification foraluminum nitride and functional powders and ISO
14001 certification for the Tokuyama FactoryJan. 1999 Acquires ISO 14001 certification for the Kashima Factory
Jun.
Acquires ISO 9002 certification for chemical products,
polypropylene, films and others
Dec.
Sets up the Ecological Management Initiative Department
Dec.
Acquires ISO 9002 certification for polycrystalline
silicon, organic solvents and suchlike
Aug. 2000 Creates the Recycling and Environmental Business Department
Apr. 2001 Establishes Yamaguchi Eco-Tech Corporation.
Apr. 2002 Acquires ISO 9002 certification for vinyl chloride
monomer and polyvinyl chloride
Jun.
The Kashima Factory becomes the recipient of theAward for Earth-Friendly Companies from the Ibaraki
Prefectural Government.
Mar. 2003 Recipient of an award from the Director-General of theIndustrial Science and Technology Policy and Environment
Bureau of the Ministry of Economy, Trade and Industry in theAward for Resource Recycling Technologies and Systems

Tokuyama CSR Report 2009

Fax +81-3-3499-8961
An interview with Etsuro Matsui, Managing Director
and General Manager of the Corporate Social
Responsibility Division* To ensure accessibility to as many readers as possible, the CSR Report is also available via Tokuyama’s website.

http://www.tokuyama.co.jp/eng/enviro/

Tokuyama CSR Report 200950