2022
CMK ReportCompany Motto

Development and Lasting Prosperity
Basic Philosophy
We in the CMK Group pursue the mental and material happiness of employees, and manufacture andsell safe and secure products with awareness and responsibility to increase our value to society andcontribute to the latter’s development.

Management Policy
1. We will implement open and aboveboard manufacturing.
2. We will create dynamic workplaces where employees can anticipate environmental changes andrespond flexibly.
3. We will respect each other, think carefully and talk often to deepen understanding, and cooperate to
make profits regardless of individual attributes such as base, division, position or nationality.
4. We will strive to improve yields and strengthen the quality assurance system by making quality
improvement a daily task.
5. We will increase the operating rates of production plants.
6. We will use resources efficiently and promote environmental protection.
7. We will continue to develop, manufacture and sell printed circuit boards into the future to be of use tocustomers and society.
CONTENTS
01. Company Motto, Basic Philosophy, andManagement Policy
02. Message from the President
03. The Reliability Standards and Technology
Behind Printed Circuit Boards.
05. Sustainability Promotion Structure
06. Activity Themes and Status of Initiatives in
FY202107. Corporate Governance & Management
13. Information Security
14. Environmental Protection
18. Fair Trade
19. Human Rights and Labor
21. Health and Safety
23. Quality and Safety

24. Response to Customer Needs
25. Social Contribution
26. CMK Group Business Bases
27. Performance and Financial Highlights
29. Corporate Data
30. Stock Information

Abbreviation of names of CMK Group Companies in this report: CMK Products Corporation = CMK Products: CMK Corporation (Thailand) Co., Ltd. = CMK Thailand: CMK Electronics (Wuxi) Co., Ltd. = CMK (Wuxi): CMKC (HK) Limited = CMKC (HK): CMKC (Dong Guan) Ltd. = CMKC (Dong Guan)
Other information regarding business locations- In July 2022, the SE Center in Miyoshi, one of our sales and administration bases, was relocated to the Kawagoe Office in Kawagoe City.

01

Message from the President
We contribute to the happiness of ouremployees and the advancement of society
through the sustainable growth of the CMKGroup and the creation of value over the
medium- to long-term.

Isao Osawa President and CEO
The COVID-19 pandemic has not yet subsided, and as well as affecting the health of individuals, it has also caused
disruption to global supply chains due to lockdowns. Furthermore, in Eastern Europe, Russia’s invasion of Ukraine
began in February of this year, and even at the time of writing this, some six months later, the conflict continues to
impact the global economy and people’s hearts.
Meanwhile, the world has shifted course greatly toward creating a sustainable society, and initiatives such as thedisclosure of risks and opportunities presented by human capital and climate change are increasing in importancefor companies at an ever faster pace.
Under this backdrop, with the restructuring of the Tokyo Stock Exchange on April 4, 2022, CMK Corporationtransitioned to the TSE Prime Market. Companies listed on the Prime Market face more advanced governancerequirements, and CMK Corporation is promoting the further strengthening of our corporate governance. We areworking to ensure that discussions at Board of Directors meetings among the internal and outside directors arehighly transparent and held on an equal footing. We also regularly disseminate the message that our employees’
happiness and the advancement of the CMK Group are two halves of the whole, both of them indispensable, andwe have strived to maintain good communication with employees through questionnaire surveys and company
newsletters.
In the belief that meeting the expectations of our stakeholders means realizing our company motto of “Development
and Lasting Prosperity,” in 2020, as a first step to realize that motto, we stated clearly in our Basic Philosophy that
we would pursue the mental and material happiness of our employees.
Further, with the aim of raising the fundamental wellbeing of our employees to a higher level, in 2021, we launchedmultiple project teams in which employees and directors worked together to promote the establishment of in-houseprograms and working environments with the aim of achieving communication that is free of hierarchicalboundaries.
As values in the surrounding community change with the times in various ways, we believe that the sharing ofvalues between the company and our employees is an unwavering and crucial theme. To this end, the CMK Groupwill engage in activities that place greater emphasis on gaining the understanding of our stakeholders who support
us, including shareholders, business partners, and local communities.
The CMK Group will strive to enhance corporate value even further, as we aim to realize a safe and comfortablesociety through the continued supply of printed wiring boards.

02

The Reliability Standards and Technology Behind
Printed Circuit Boards.
Car Electronics

Information andcommunication systems
Navigation
Infotainment
V2V, V2X Communication
Modules
Back monitor

Body electronics / climate control Body Product
Body Control Module (BCM Body ECU)
Dashboard
Air Condition
Lighting

Driving control and safety systems
Electric Power Steering
Brake control
ADAS millimeter-wave radar
ABS air bag system
VSC sensing camera
LKAS driver monitor

Powertrain
Integrated ECU
Ev motor Control ECU
DC/AC Inverter
DC/DC ConverterIntelligent Power Module

abilityHigh reli act
comp
Fine andh heatncy/HigeuqerfHigh issipationdance
at resist
e
h
h
ig
H

Approaches to CASE

C

Connected
コネクテッドMulti-layered HDI PCBs arebeing used in the evolution of
the connected car.

Multi-layered HDI PCB (cross-section)A

S

Autonomous
自動運転

Sharedシェアリング

E

Electric
電動化

The receiver antenna in
Advanced Driver Assistance
Systems (ADAS) require PCBs
with Higher resolution circuits.

“From ownership to sharing.” As the volume of
information processed by vehicles increases,
hybrid-structured PCBs with conventional andhigh-frequency materials are being adopted.

In the electrification of automobiles, heavy-copper
PCBs are used to accommodate high voltage
currents and high heat dissipation. We will strive tokeep pace with the further evolution of integrated ECUs.

High-resolution and fine-circuit MSAP (external view)

High-frequency hybrid PCB (cross-section)

Inner/outer layer of heavy-copper PCB (cross-section)

03

Mobile Devices and Smartphones

Approaches to 5G Communications

14-layer AnyLayer PCB for smartphone (cross-section)

One-stop responses from design/simulation to PWB manufacturing
and PCB AssemblyOne-stop Solutions
PCB design/simulation

Multi-layered HDI PCB for base station(cross-section)

PCB manufacturing

PCB Assembly

Simulation Analysis Technology
Signal system analysis

Anti-noise measures

Power system analysis

Optimize circuits to prevent errors
caused by signal deterioration

Reduce noise diffusion insideand outside PCBPrevent IC malfunction caused
by voltage variation and drop

Heat analysis

Structure analysis

High-speed transmission measurement (actual measurement)

Improve heat dissipation by reducing heat
resistance on the heat dissipation route

Predict malfunction by thermal
stress analysis on local area of PCB

Confirm simulation + manufacturing +actual measurement = appropriateness04

Sustainability Promotion Structure
Under the company motto, “Development and Lasting Prosperity,” in the pursuit of our goals of sustainable growth and the creation of medium-to longterm corporate value, we will actively promote CSR activities as part of our corporate purpose, by directly addressing social issues through business.

Basic Sustainability Policy
The CMK Group has had Development and Lasting Prosperity as its company motto since its
founding. We strive to realize a sustainable society and improve corporate value by fulfilling the
expectations of society and stakeholders by supplying “the world’s top-class safe and secure
printed circuit boards” that meet the new society and values.
1. We strive to reduce the environmental footprint of our business activities, aiming to achieve
decarbonization.
2. We provide safe and secure products to provide value to society and contribute to therealization of a sustainable society.
3. We recognize the importance of compliance and realize healthier and more transparent
management.

CMK Group Action Statement (excerpt)
Working with customers

By providing safe and secure products and services, the CMK Group strives to be agroup that customers can continue to rely on.

Working with shareholders and investors

The CMK Group will endeavor to gain the understanding of shareholders andinvestors through appropriate and proactive communication.

Working with business partners

The CMK Group will endeavor to build good partnerships with its business partners
through fair and equitable commercial transactions.

Working with employees

The CMK Group will endeavor to create environments in which each employee canwork confidently and energetically.

Working with society

The CMK Group will contribute to the realization of a sustainable society through its
corporate activities.

For sustainable growth and medium-to long-term value creation
Under the company motto, “Development and Lasting Prosperity,” we are strengthening our sustainability
promotion structure to pursue sustainable growth and medium-to long-term value creation.
Led by the director in charge of CSR, and with a newly appointed executive officer in charge of sustainability wewill strengthen this structure, while promoting initiatives to deal with climate change and other material issues.

05

Activity Themes and Status of Initiatives in FY2021
We have announced the following activity themes and are pursuing initiatives based on these themes.
Details of some of the activities undertaken in FY2021 are provided on individual pages.

Status in Areas of CSR Activities
ESG

ISO26000
Core Subjects

Activity ThemeFY2021
Evaluation

Details of Major Activities (Issues)

SDGs

Strengthen internal control, risk management and BCP systems

G

Enhancement of corporate value

GovernanceIR activities, communication with shareholders and investors

Organizational
governance
Maintenance and raising of
information security level

Human rights/
Labor practices

Promote recruitment of foreign nationals
Promote employment of people with disabilities
Promote career development for female employees

Development of global humanresources

Promote study abroad program

Employees’ health and safety

Improvement of the workplaceenvironment

Society

Fair operating
practices

Fair trade
Technological innovation

ConsumerissuesResponse to customer needs
Product development to matchcustomer needs
Improvement of product quality/
ensuring safety

Community
involvement anddevelopment

Activities for improvement through self-evaluation

Promotion of diversity

Work-life balance

S

Initiatives to mitigate risks of confidential information leaks

Contribution to local
communities

Ensure and improve workplace safety environment
Initiatives for mental health issues
Promote use of various leave programs
Initiatives for shorter working hours
Initiatives on food waste
Conduct CSR survey
Conduct training on Anti-Monopoly Act and Subcontractor
Payment Act
Innovation in response to needs, such as AI, use of robots, andlabor-saving
Conduct CS survey
Improve customer evaluation and satisfaction
Continue to exhibit at trade shows
Promote new product development
Build and embed integrated management system
Promote activities for contributions to local communities
Promote involvement in local communities
Action on Scope 3

CO2 reduction activities

E

Activities in line with energy conservation promotion plan

Environment

The environment

Management of substances ofconcern

Chemical management in response to regulations and customer
requirements

Biodiversity conservation
activities

Promote community-based environmental protection activities

Waste reduction

Promote zero-emission activities*Icons in each category indicate the connection between the SDGs and the CMK Group’s action themes

Approach to the Sustainable Development Goals (SDGs)
The Sustainable Development Goals (SDGs), which were adopted at
the UN Summit in September 2015, consist of 17 goals and 169
targets covering areas such as poverty, environment, education andemployment. They are common goals for the world to achieve by2030. CMK Corporation will strive to contribute to realizing asustainable society through its business activities.

06

Governance

Environment

SocialCorporate Governance & Management
Corporate Governance Structure
CMK Corporation employs the corporate auditor
system. The Board of Directors consists of eight
directors, three of whom are outside directors, and theBoard of Company Auditors consists of four corporate
auditors, two of whom are outside auditors. In
addition, we have established an executive officer
structure that enables us to make importantmanagement decisions and execute business
operations quickly and rationally. This structure also
clarifies the authority and responsibilities of officers.
Outside directors monitor the decision-making of theBoard of Directors and supervise business operations
from an objective and neutral viewpoint.
In addition to attendance at the Board of Directors
meetings, outside corporate auditors receive
explanations of important management matters fromthe directors and express their opinions on thosematters, as well as auditing the directors’ execution of
their duties. The supervisory function of the outside
directors and the auditing function of the outside
corporate auditors ensure the objectivity and neutralityof the management monitoring function.
We have also established a Nomination andRemuneration Advisory Committee as an advisoryorganization for the Board of Directors, with the aim ofenhancing the fairness, transparency, and objectivityof processes concerning the nomination andremuneration of directors. The committee iscomposed of two internal directors and three
independent outside directors, with one of the
independent outside directors serving as chair.

Corporate Governance Structures
General Meeting of Stockholders
Election/Dismissal

Election/Dismissal

Coordination

Accounting Auditor

Board ofCompany Auditors
Auditing

Election/Dismissal

Auditing

Advisory/Report

Nomination andRemuneration
Advisory Committee

Accounting
Audit

Coordination

Coordination

Board ofDirectors

Internal Control
Management
Committee

Instruction/
ReportReportElection/Dismissal/
Supervision

President
and CEO
Instruction

Coordination

Audit Instruction
ReportAudit OfficeInternal Audit

Executive
Officers
Instruction

Operating Divisions and Group Companies

Internal Control System
Pursuant to the Basic Policy on Internal Control
determined by the Board of Directors, the Group
works to make continuous improvements to its
internal control system. The Internal Control
Management Committee, a standing committee
composed of internal directors, plays a leading role in
the framework and overall design of internal control
system promotion. Two working groups under theCommittee, the Compliance Promotion Working
Group and the Financial Reporting Working Group,
handle their respective areas, with executive officers
playing a central role. The Internal Control
Management Committee checks and evaluates thestatus of establishment and operation of initiatives ineach area and reports to the Board of Directors on aregular basis.
07

Governance

Environment

Social(Internal Control Management Structure)
Board of Directors
Internal Control Management Committee
Chair: President

Deputy Chair : Director in charge of internal control management
		Internal Director

Internal Control Management Sub-committee (Chair: Director in charge of internal control management)(Companies Act area)
Compliance Promotion Working Group(Financial Instruments and Exchange Act area)
Financial Reporting Working Group

Risk Management Structure
To deal with risks surrounding the Company, we haveestablished a company-wide, cross-departmental risk
management framework and are working to enhance
our risk management in accordance with companywide policies. To prepare for unforeseen events andensure that immediate and appropriate action can betaken should such an event occur, we haveestablished a Risk Management Committee and aredeveloping systems and conducting operational
simulations and training during normal times. In thisway, we are working to strengthen our company-widerisk management. As part of our emergency response,
we have also established the BCP Risk Management
Office, a dedicated organization under the directsupervision of the president, which is charged withbuilding mechanisms for ensuring business continuity.
In this way, we are promoting the building of
mechanisms that will contribute to sustainable
development and the enhancement of corporate value
over the medium-to long-term.

CompliancePositioning compliance as our most importantmanagement issue, CMK Corporation strictly complies
with laws and ordinances, the Articles of Incorporation,and social norms, and is engaged in the establishmentof compliance standards and systems and thestrengthening of operations to ensure compliance. In
terms of structures, led by the director in charge ofcompliance, we are promoting initiatives formaintaining and increasing awareness of complianceamong all directors and employees of the Group, as
well as the management team. Specifically, we haverevised the CMK Group Action Statement, which
provides guidelines for employee conduct, and we

conduct compliance training, including information
security and risk management training, on a continual
basis. We also strive to understand the degree ofawareness of our employees regarding complianceand the situation in the workplace environment byconducting questionnaire surveys of all employees. In
addition, concurrently with the enhancement of ourhelplines, including raising awareness of our internal
whistle-blowing systems, we are working on theestablishment of systems to ensure that signs ofcompliance violations are not overlooked. This
includes workplace-based monitoring by the internal
audit division.

Nomination and Remuneration Advisory Committee
We are working to strengthen governance with theestablishment of the Nomination and Remuneration
Advisory Committee, which plays important roles suchas the discussion of important matters, including
personnel and remuneration of directors, etc. and theprovision of advice to the Board of Directors from theperspectives of objectivity, transparency, andappropriateness. This Committee met four times in
FY2021.
Matters concerning
nomination
Matters concerning
remuneration

Composition of Nomination and Remuneration Advisory Committee
Chair
Rika Sato (Independent Outside Director)
Members
Isao Osawa (President and CEO)
Kazuto Ono (Director and Executive Officer)
Tsuyoshi Ukyo (Independent Outside Director)
Mitsuru Kaitoh (Independent Outside Director)

Major Agenda Items- Appointment of new directors and executive
officers- Changes in areas of responsibility of officers- Policies for determining remuneration of
directors- Introduction of non-monetary remuneration(stock-based remuneration)- Performance-linked remuneration
08

Governance

Environment

SocialList of Directors and Company Auditors and Skill Matrix (As of June 28, 2022)
Name

Career background

Directors

Board of Directors

Isao Osawa

Kunihiko Tedo
General Manager of President Office

Yoshihisa Yamaguchi
In charge of Accounting
In charge of CMK Products Corporation

Yoshiaki Ishizaka
In charge of Procurement
and Sales

Kazuto Ono
In charge of Personnel System Reform,
Internal Control Management and CSR

Tsuyoshi Ukyo

OutsideIndependent

Rika Sato
OutsideIndependent

Mitsuru Kaitoh
OutsideIndependent

1989 Joined CMK Kanbara Electronics Corporation2014	Joined the Company CMK Corporation. Deputy General Manager ofDomestic Operations Head Office and Kanbara Manufacturing
Operation2016 Director and Executive Officer
2018 President (current position)

Masashi Koike

Akihiro Okabe

Yuji Yamanashi
Independent

Masaki AshibeOutsideIndependent100%(13/13)1980 Joined Canon Inc.
2007	General Manager of Accounting Department of Office Imaging
Products Division of Canon Inc.
2012	‌SVP & CFO and Treasurer of Canon USA, Inc., and President &CEO of Canon Financial Services, Inc.
2021 Director and Executive Officer (current position)

100%(10/10)1991 Joined the Company
2004	General Manager of Corporate Planning Department of theCompany2021 Director and Executive Officer (current position)

100%(10/10)1988 Joined the Company
2005	General Manager of Department III of East Japan Region Sales
Division
2021 Director and Executive Officer (current position)

100%(10/10)1980 Joined Canon Inc.
2013	Director and Group Executive of Human Resources Management &Organization Headquarters of Canon Inc.
2019	Senior Managing Director of Japan Audit & Supervisory Board
Members Association
2022 Director and Executive Officer (current position)—※2

1992	Assistant, Division of Mechanical Engineering and Materials Science,
Yokohama National University
2012	‌Professor, Division of System Research and Course of Systems
Design, Faculty of Engineering, Yokohama National University(current position)2015 Outside Director (current position)
1992
2016
2018
2019

100%
(13/13)

Registered as an attorney
Partner, Ota & Sato
Outside Director (current position)
Representative, Sato & Partners (current position)

100%(13/13)1978 Joined ROKU-ROKU SANGYO, LTD2011 President of ROKU-ROKU SANGYO, LTD (current position)2020 Outside Director (current position)

Corporate Auditor

OutsideAttendance at Board of Directors andBoard of Company Auditors meetings
in FY2021

1989
2006
2012
2019

Joined the Company
Senior General Manager of East Japan Region Sales Division
President of Yamanashi Sanko Co., Ltd.
Standing Corporate Auditor (current position)

1984
2010
2011
2021

Joined the Company
General Manager of Accounting Department
Director of Yamanashi Sanko Co., Ltd.
Standing Corporate Auditor (current position)

1979 Joined the Tokyo Tomin Bank, Limited (now Kiraboshi Bank, Ltd.)2012 Managing Executive Officer of the Tokyo Tomin Bank, Limited
2018	Audit & Supervisory Board Member of Tokyo Kiraboshi Lease, Inc.
(current position)
2021 Corporate Auditor (current position)
1981
2010
2013
2021

Joined the Sumitomo Bank, Ltd.
Executive Officer of Sumitomo Mitsui Banking Corporation
Representative Director and President of SMBC Guarantee Co., Ltd.
Corporate Auditor (current position)*1. The above list does not represent all the knowledge and experience of each person.
*2. As Kazuto Ono assumed the office of Director on June 28, 2022, he did not attend any meetings in FY2021.

09

100%
(13/13)

Board of Directors

Board ofCompany Auditors

100%

100%

(13/13)(14/14)

100%

100%

(10/10)(11/11)

100%

100%

(10/10)(11/11)

100%

100%

(10/10)(11/11)Governance

Environment

Social★ Chair ● Member

Expected roles, expertise and background*1
Corporate
management

Finance /Accounting●

Manufacturing /Technology /Development

Sales / Marketing

Global experience

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

Personnel and labor Nomination and
Human resources
Remuneration
development
Advisory Committee

●

●

●

Law

●

●

●

●

●

●

●

●

●

●

★

●

●

●

●

●

●

10

Governance

Environment

Social

Evaluation of the Effectiveness of the Board of Directors
auditors were asked to complete a self-evaluationquestionnaire that covered various perspectives,
including the composition of the Board of Directors,
operation, functions, roles, and the provision of
information to outside directors and corporate
auditors.

With the aims of achieving sustainable growth andenhancing corporate value over the medium-to longterm, the Company evaluates the effectiveness of theBoard of Directors every fiscal year in an effort tostrengthen its functions and achieve continuous
improvement. In FY2021, directors and corporate

Evaluation Process
Directors and corporate
auditors complete an
anonymous selfevaluation questionnaire

Questionnaires responses arecollected from all directors andcorporate auditors and tallied
to produce data for comparison
with previous fiscal years

Results are analyzed
and evaluated by a third
party to enhance
objectivity andtransparency

Analysis and evaluation
results are reported to theBoard of Directors, whichthen holds discussions to
identify issues

Remuneration of Directors and Corporate Auditors
The following is a summary of the policies regarding
decisions on remuneration and other details of
individual directors.

three years by a certain percentage and it is paid
together with the monthly fixed remuneration. Nonmonetary remuneration is paid in the form of restricted
shares, in which the transfer of the shares is restricted
for the duration of the director’s term of office. The
number of restricted shares is determined based on acomprehensive consideration of the Company’sbusiness performance and share price, according to
the individual directors’ positions, responsibilities, andother considerations. These shares are granted at a
specific time every year.

Basic policy
Regarding the remuneration of directors, we haveadopted a structure in which remuneration is linked toshareholder profits, to enable adequate functioning as
an incentive to achieve sustainable growth incorporate value. Our basic policy is that, in thedetermination of the remuneration of individual
directors, such remuneration should be at an
appropriate level based on the responsibilities of eachdirector. Specifically, remuneration of directors andexecutive officers consists of basic remuneration,
performance-linked remuneration, and non-monetary
remuneration (restricted share-based remuneration).
Meanwhile, outside directors, who have a supervisory
function, will be paid basic remuneration only, in lightof their duties.

Determination of remuneration, etc.
Determination of the specific details of remuneration,etc., of individual directors is entrusted to thepresident, based on a resolution of the Board of
Directors. Pursuant to the basic policy, the president
determines remuneration amounts for individual
directors after seeking the deliberation and consent of
the Nomination and Remuneration Advisory
Committee regarding basic remuneration andperformance-linked remuneration. For non-monetary
remuneration, after deliberation by the Nomination andRemuneration Advisory Committee, the number ofrestricted shares to be allotted to individual directors isdetermined by the Board of Directors.

Basic remuneration
Basic remuneration of directors is a fixed monthly
salary determined on the basis of a comprehensive
consideration of other companies’ standards, theCompany’s business performance, and employee
salary levels, according to the position, responsibility
and contribution of individual directors.

Remuneration of corporate auditors
Corporate auditors are paid basic remuneration only,
in light of the fact that their role is to audit the
Directors’ execution of their duties. Basic remuneration
is determined separately for the standing and nonstanding corporate auditors within the limit decided byresolution of the General Meeting of Shareholders andis decided upon discussion with the corporate
auditors.

Performance-linked remunerationand non-monetary remuneration
Performance-linked remuneration is cash
remuneration that reflects performance indicators, withthe aim of raising awareness of improving
performance each fiscal year. The amount iscalculated by multiplying the average amount ofconsolidated ordinary income for the most recent
11Governance

Environment

SocialInitiatives for Strengthening Corporate Governanceestablishment of the Nomination and Remuneration
Advisory Committee, we are working to improvetransparency and fairness and to strengthen
monitoring functions. We will continue in our efforts tomake ongoing improvements to corporate governanceinto the future.

To enhance corporate value over the medium- tolong-term, we are working to improve theeffectiveness of the Board of Directors. This includes
ensuring diversity in the Board, allowing the outside
directors to demonstrate their functions, improving thequality of deliberations, and strengthening theexecution auditing functions. Further, with the(Year)

2002

2003

2015

2016

2017

2018

2019

2020

2021

2022

Introduced executive officer system
Reduced directors’ terms to one year
Abolished directors’ retirement benefits scheme (2012)
Election of one outside director

Increased to two

Increased to three
Outside directors account for more than 1/3

Implemented evaluation of effectiveness of Board of Directors (once a year)
Elected female outside director
Established Nomination and Remuneration Advisory Committee
Disclosed skills matrix
Introduced non-monetary remuneration (restricted shares)

Composition of Directors
Outside: 3

Female: 1

37.5%

Ratio of outside
directors

Internal: 5

62.5%

12.5%

 omposition of NominationC
and Remuneration Advisory
Committee
Outside: 3
60%

Ratio of female
directors

Ratio of outside
directors

Male: 7

Internal: 2

87.5%

40%

12

Governance

Environment

SocialInformation Security
With the increasing sophistication and diversity of cyber attacks and the rise in information security
threats, we have placed the highest priority on protecting the information provided by our customers. To
ensure that information assets are protected and handled safely, we are working to eliminate risks byundertaking a range of initiatives to maintain and improve information security measures.
In the belief that risk management is crucial, we are working to enhance awareness of information security, while proceedingwith activities for continuous improvement through the PDCA cycle.

PLAN

DO

Policy and relevant rules

Employee education

To ensure that information assets have strong protection
and are used and shared appropriately, we haveestablished an Information Security Policy and Information
Security Management Rules. Regarding personal
information, we have established a Personal Information
Protection Policy, Personal Information Protection Rules,
and Specific Personal Information Handling Rules, andwe comply strictly with these policies and rules.

As damage caused by cyber attacks is on the rise, ourCompany regularly distributes an Information Systems
Newsletter to employees to teach them how torecognize methods of attack and suspicious e-mails, aswell as how to respond if they suspect that their
computer may have been infected with a virus. We also
conduct training for managers every year in our efforts
to enhance security awareness among employees. In
addition, we conduct training exercises in which a mockattack e-mail is sent, and the recipient actuallyexperiences how to respond to such suspicious e-mails.
This trains employees to deal with any suspicious
e-mails that may slip through other security measures.

CMK Group Information Security Policy
The CMK Group believes that the appropriate
management of information assets, one of its
managerial resources, is most important. Under thisBasic Policy, we will endeavor to maintain andenhance information security in a systematic andcontinuous manner.

P D
A C

CHECK

System-based security measures

1. We will comply with relevant laws, regulations, internal
rules, other social norms, etc.
2. In order to appropriately manage the information
assets that we have, we will ensure information security
according to the degree of importance and risk.
3. We will provide officers and employees with education
regarding information security
4. We will establish and maintain the relevant
management systems through continuous activities forenhancing information security.

To guard against information leaks due to the loss of IT
devices or cyber attacks, we implement various systembased measures and check the status of penetration ofthese measures on the ground. Such measures include
installing antivirus software on terminal devices, encrypting
PC hard disks, and prohibiting the use of external storage
devices such as USB flash drives in principle.

Measures against natural disaster risks

Response to risks

To prepare for natural disaster risks, we conduct statuschecks of disaster preparation measures at our data
centers. We have also made arrangements to ensure that
operations are not impeded even if a cloud environment
becomes unavailable, through decentralized use andintroduction of redundancy in cloud environments.

In the “Plan” stage of the PDCA cycle, we identify information
assets, clarify high-risk assets, and analyze their confidentiality,
completeness, and availability. Based on the likely impacts in theevent a risk is manifested, we envisage what measures should
be taken against those impacts and decide on those measures.

ACT

Improvement activities
Based on the examination of the impacts of risk exposure, countermeasures and decision-making regarding those
impacts, and the appropriateness of those countermeasures and decisions, we manage information assets
appropriately while flexibly correcting course as needed, including making amendments as required.

[Examples of measures (excerpt)]- Detection and blocking of suspicious e-mails- Monitoring and detection of terminal devices using EDR
system- Encryption of personal computer hard disks- Data storage on designated clouds- Remotely locking operations and acquiring location
information of smartphones- Restriction and management of connection with external
storage devices such as USB memory sticks*EDR: Endpoint Detection and Response A solution in response to cyber attacks through the detection and investigation of suspicious
behavior or traces at endpoints such as personal computers connected to the network.

13

Governance

Environment

SocialEnvironmental Protection
Recognizing environmental protection activities as an important management issue, we formulated a Mediumto Long-Term Environmental Action Plan under our Environmental Policy to clarify our basic stance, and we arepromoting related activities under this plan. ALL CMK employees will work together to realize a sustainable
society in co-existence with the Earth.

Responses to Climate Change
The CMK Group has endorsed the Task Force on Climate-related Financial
Disclosure (TCFD), and we are pursuing initiatives to mitigate climate change.

GovernanceMonitoring by Board of Directors
Governance Structure- The Board of Directors, which is accountable for ESG risks and opportunities,
for
Climate Change Risks
including climate change, and the company’s responses to them, receives regular
reports on these matters from the Company-wide Environmental Committee. The
Board of Directors
Board is also responsible for deliberating and making decisions on key related
policies.
Further, it takes such matters into account in the deliberation and decision of annual
Regular
Supervision
reports
plans and budgets.
- The Board of Directors supervises progress on climate-related indicators andEnvironmental
targets and, if necessary, deliberates and decides on measures.
Executive Officer
Roles of management in evaluation and management of climate-related risks
Company-wide
and opportunities
Environmental Committee- The Company-wide Environmental Committee was established as a body for(Secretariat)
evaluating and managing of risks and opportunities related to climate change, with
Sustainability Promotion
the Executive Officer in charge of the environment serving as the responsible officer.
Department
The Sustainability Promotion Department serves as the secretariat of thiscommittee.
- The Company-wide Environmental Committee checks climate change-related risks and opportunities and progress on
related indicators and targets, identifies key issues, and proposes measures to the Board of Directors.

Strategies‌
Havingidentified “climate change” as a medium-to long-term risk, for the purpose of discussing strategies andorganizational resilience based on related risks and opportunities, we have conducted scenario analyses with a primary
focus on the automotive products business in Japan to consider the long-term impacts on our Company up to 2050, whilereferring to the climate change scenarios (*below 2°C Scenario and 4°C Scenario) of the International Energy Agency (IEA)
and the Intergovernmental Panel on Climate Change (IPCC).
*Below 2°C Scenario: Refer to external scenarios such as IEA’s WEO SDS. Scenario in which measures such as strengthening of regulations and market changes are taken to
keep temperature rise to a minimum
4°C Scenario: Refer to external scenarios such as IPCC’s RCP 8.5. Scenario in which physical impacts, such as extreme weather events, occur as a result of temperature rise

Risk management
Risk identification and evaluation process- The Company-wide Environmental Committee identifies andRisk Management Structureevaluates climate change risks in collaboration with relevantCentralized management of company-wide risks
departments.
Company-wide
BCP RiskInternal Control
Risk management process
Environmental
Management
Management
Committee
Committee
Information Committee Information- As the process for managing climate-related risks, thesharing
sharingCompany-wide Environmental Committee analyzes climateBCP risk
Compliance risk
Secretariat
related risks, develops and promotes countermeasures, andmanagement
and internalmanages progress on an ongoing basis.
Sustainability Promotion
control risk
- We assign an order of priority to climate-related risks based
management
Department
on the probability of the occurrence of the risks andManagement ofopportunities and their likely impact.
climate change risk, etc.
Integration status of organization-wide risk management- We have established a cross-sectional risk management structure based on the company-wide policy and arestrengthening our risk management.
- The Internal Control Management Committee conducts centralized management of company-wide risks, including climatechange risks, and reports to the Board of Directors as necessary.

14

Governance

Environment

Social

Risk High➡
Medium ➡
➡
Low

Major Risks, Opportunities, and Responses Related to Climate Change(Evaluation focused on automotive products business in Japan)
Risk/
DegreeOpportunity of Impact

Scenario

Factors

Changes

Below 2°C
(Transition)

Impact ofcarbontax- Transfer of carbon tax to raw
materials costs- Imposition of carbon tax on
operating costs- Transfer of raw materials
manufacturers’ renewableenergy introduction costs to
product prices- Increase in unit price ofsurcharges for promoting
renewable energy generationand procurement- Increasing importance of energy
conservation for decarbonization

Strengtheningofdecarbonization
policies

Risk

➡

Risk

➡

Risk

➡

Opportunity

Changes incustomer
behavior,
demandfor
responsible
actionagainstclimatechangeProgressin shift toEVs and
FCVs

4°C(Physical)

Naturaldisasters(Acute)(Chronic)- Demands from customers forproviding of LCA-like CO2
emissions and for CO2
reduction- Increased risk of reputational
damage, etc. due to inability todisclose responsible climatechange response activities (andinvestment potential through theevaluation of disclosures)- Increase in demand for
products used in EVs with
progress in shift to EVs and
FCVs- Increase in demand for
products for dedicated charging
devices and other EV-related
equipment in proportion withpopularization of EVs- Suspension of operations due
to damage to factories andoffices, damage to customers,
and damage to materials
suppliers caused by natural
disasters- Increased load on air
conditioning due to risingtemperatures➡

Opportunity扌Opportunity

Impact on CMKCMK Countermeasures- Increase in raw material costs- Increase in operating costs due toimposition of carbon tax for Scope
1&2 emissions- Increase in raw material costs- Encourage business partners to
reduce CO2 emissions, consider
low-emitting materials, etc.
- Increase ratio of renewable power- Develop and procure materials withhigher energy efficiency- Increase in operating costs- Reduce power usage throughenergy-saving measures- Lower power costs, carbon tax cuts

- Upgrade to facilities with higher
energy-saving effectiveness andlower CO2 emissions- Increase utilization rates of
production equipment- Promote visualization of energy
consumption- Promote calculation and disclosureof CO2 emissions, reduce CO2
emissions through energy-saving
measures and procurement of
renewable energy- Disclose climate change response
activities

扌

Risk

- Lower sales due to failure to respondadequately to requests from
customers- Loss of reputation, lower recruitment
capability and market share, higher
capital costs due to failure todisclose climate change responses- Higher sales of products for EVs- Higher sales of products for EVrelated equipment

扌

Risk

➡

Risk

➡

Opportunity High扌扌Medium扌
Low

- Invest in and develop market
channels for products for EVs- Strengthen collaboration withcustomers- Secure multiple suppliers, consider
alternative materials- Lower sales due to suspension ofoperations at own factories- Confirm the actions to be taken in
the event of a disaster with suppliersand customers, formulate recovery
plans- Higher costs for temperature control
of clean rooms and storage
warehouses- Upgrade to facilities with higher
energy efficiency

Indicators and Targets
CMK Corporation has been promoting environmental
initiatives under our Medium-to long-term Environmental
Action Plan “Smart e-change 30” established in 2020. As
responses to climate change to achieve carbon neutrality
are a matter of urgency, we have revised our 2030
medium-term targets and will make a fresh start with
“Smart e-changes 30 plus.” Recognizing the identification
and reduction of supply chain emissions as key issues, wewill engage in achieving this new plan.

Indicators

Targets

1. CO2 emissions(Scope 1, 2)

Medium-term CO2 emissions target(Japan): 46% reduction (2030, comparedwith FY2013)

2. Energy
consumption

Energy reduction target (CMK Group): 1%
energy intensity reduction (compared withprevious fiscal year)

CMK’s initiatives
Carbon Neutral

1st Step

2020

Prevention ofenvironmental
pollution

2nd Step

Strengthen initiatives forenvironmental activities toachieve SDGs goals in 2030

Climate change mitigation

Reduce CMK’s CO2 emissions
significantly to contribute to
mitigating climate change

2030

15

Waste reduction
Resource
recycling

Management of 5 issues
Biodiversity
environmentallyconservation
hazardous substancesGovernance

Environment

SocialCO2 Emissions
The CMK Group promotes energy conservation activities
in both manufacturing and back office divisions to reduce
CO2 emissions, which are a cause of global warming. In
FY2021, we implemented 20 energy conservation
initiatives, including upgrading to highly energy-efficient air
compressors and swapping out electric lighting for LEDs.
Through these efforts, we expect to reduce power
consumption by about 4 million kWh, which is equivalent
to a reduction of 2,192 t-CO2. In FY2021, CO2 emissionsof the Group in Japan amounted to 64,000 t-CO2 (downby 5.6% year-on-year), with overseas emissions
amounting to 185,000 t-CO2 (up by 9.3% year-on-year).

Scope1,2 Annual CO2 Emissions (Japan/Overseas)(x 1,000 t-CO2)

200

185

178

172

164

169

150

100

84

50

160

79

165

173

157

72

68

64

69

65

60

56

51

15

14 12
2018

12 13
2019

11 12
2020

12 12
2021

11
2017

0

We are actively working on awareness-raising activities,
such as displaying posters and setting up special
environmental awareness zones to educate employees
about the issues.

153

(FY)

Group in Japan : ■ Scope1 ■ Scope2 Group overseas : ■ Scope1 ■ Scope2

Annual Energy Consumption (Japan/Overseas)(Crude oil equivalent, x 1,000 kl)

100
80

76

73

70

65

69

60
40

39

38

2017

2018

35

33

34

2019

2020

2021

(FY)

100

(%)

20
0

■ Group in Japan■ Group overseas

Waste Reduction/Resource Recycling
Zero-emission initiatives

Zero Emissions Rate

The CMK Group defines zero emissions as “to achieve
zero emissions of waste destined for direct landfill disposal(not including landfill disposal of residue from intermediate
treatment outsourced to independent operators)” and is
working to achieve this goal. In FY2021, the Group in
Japan maintained its 100% record of zero emissions, while
overseas, the result was 99.3% (up 2.0 points year-onyear).

100
100

100

100

100

99.3

97.3
95

95.4

96.1
94.8

90

85

Effective use of water resources

2017Group in Japan

Group overseas

2018

2020

2019

2021

(FY)

Annual Water Consumption

We actively promote various initiatives for effectively using
water resources and reducing water consumption, suchas the introduction of water recycling equipment and theinstallation of water saving functions in our production
facilities. Our overseas factories implement recycling
campaigns as a countermeasure against water resources
risk. In FY2021, water recycling volumes achieved byoverseas factories were as follows: 305,000 m3 by CMKThailand, 384,000 m3 by CMK (Wuxi), and 184,000 m3 by
CMKC (Dong Guan).

(x 1,000 m3)

8,000
6,882
6,000

6,341

5,937
5,302

5,266

6,202
5,287

5,095

6,189
5,175

4,000

2,000

0

2017

2018

2019

■ Group in Japan

16

2020

■ Group overseas

2021

(FY)

Governance

Environment

SocialBiodiversity Conservation
As community-based biodiversity conservation
activities, CMK Corporation is engaged incollaborative initiatives with local governments andvolunteer groups near each business site and in
the local communities. In FY2021, we raised
juvenile salmon hatched from eggs and released
them into the Nodai River in Niigata. We also
worked on the extermination of alien species andprotection of native species in the Gunma region.

Management of Environmental Hazardous Substances
The CMK Group defines chemical substances contained in materials, etc. or used in manufacturing processes that havebeen determined to have significant effects on the global environment or human health in accordance with the laws andregulations of Japan and overseas jurisdictions, customer
requirements, and industry standards as Environmental
1. Approve and register supplied materials and their suppliers
Hazardous Substances (EHS) and manages them
2. Choose registered materials
accordingly. By setting the five matters on the right as
3. Confirm that supplied materials are registered materials.
basic matters for EHS management, we are working to
4. Prove through voluntary scientific analysis that registered
prevent banned substances from contaminating ourmaterials and CMK’s final products do not contain banned
products and contaminated products from being shipped.
substances.
5. Confirm that items 1-4 are being implemented reliably.

Green procurement activities

EHS management certification scheme

CMK Corporation develops environmentally-friendly
products and engages in environmentally-conscious
production. As part of this approach, we implement green
procurement, which prioritizes the purchase of materials
with low environmental impact from business partners thathave well-established environmental management
systems. In evaluating business partners, we check their
EHS management mechanisms and their rules andoperation records according to a checklist produced by
the Joint Article Management Promotion-consortium(JAMP). We also consider their legal compliance andbiodiversity conservation initiatives. In FY2021, we
conducted such evaluations of some 200 business
partners in Japan and overseas.

We also conduct EHS management audits of our business
partners with the aim of confirming, maintaining, andimproving EHS management activities.
Business partners that receive high overall scores in theseaudits are certified as “CMK Green Partners.”

Environmentally-friendly PCB “E-spec ”
We label products that meet our own environmental
standards as “E-spec” products and engage in reducing
our environmental footprint through the supply of theseproducts.

HF

PF

HF
PF
E-spec label (registered as trademark in 2000)*The E-spec label is attached to products that meet theE-spec criteria on request.

Prevention of Environmental Pollution
As activities for preventing environmental pollution accidents, we incorporate environmental risk assessments and strive toprevent environmental risks. Further, under our environmental management system, we constantly monitor the establishment
and revision of laws and regulations, etc., to clarify the latest compliance matters on which our business activities are based.
At the same time, we regularly check the status of compliance and, in the unlikely event that there are any concerns, we
make improvements and corrections, ensuring that legal compliance is our top priority.

17

Governance

Environment

SocialFair trade
Following the CMK Group Procurement Policy, we aim for sustainable development of our mutual
corporate activities with our business partners.

CMK Group Procurement Policy
Based on the recognition that our suppliers are good partners, we will value mutual growth. By conducting
procurement activities based on the following policy, we will fulfill our corporate social responsibility together with ourbusiness partners with the aim of achieving the mutual development of corporate activities in a sustained manner.
Supplier Selection Policy
In commencing and continuing transactions, we will
evaluate and select suppliers in a fair and impartial manner,by comprehensively taking the following items into accountwith the aim to build good partnership with suppliers.
1. Compliance with laws and societal norms
2. Initiatives regarding human rights/labor, safety andhealth, the environment, ethic/fair transactions,information security, etc.
3. Management soundness
4. Quality maintenance and enhancement, optimal prices,
observance of delivery date
5. Supply chain continuity capability and degree ofcooperation during times of disaster and other
unforeseen circumstances

Basic Policy
1. Compliance with laws and societal norms
We will comply with the laws, regulations and social
norms of the countries and regions in which we conduct
procurement activities.
2. Fair and equitable transactions
We will provide equal opportunities for transactions to allcompanies in Japan and overseas. We will not engage inabuse of a superior bargaining position and will not
accept or demand gift-giving, entertainment or otherbenefits beyond socially prevailing standards andcommon sense.
3. Responsible procurement
We will conduct responsible procurement activities byconsidering human rights and the global environment.

CSR Surveys of Business
Partners

Responsible Procurement ofMineral Resources

With the aim of enhancing our partnerships with ourbusiness partners, we conduct CSR surveys on a regularbasis. In FY2021, we surveyed 55 business partners. The
results showed improved ratings for all items, confirmingthat awareness of CSR activities has further improved
among our business partners. These surveys give ourbusiness partners an opportunity to better understand ourCompany’s approach to CSR, and we will continue to
conduct them in the years ahead.

Violations of human rights by armed groups andenvironmental destruction in conflict-affected and high-riskareas (CAHRAs), such as the Democratic Republic of theCongo and neighboring countries, have become global
concerns. As armed groups are funded by illegally mined
mineral resources, surveys are conducted every year to
trace the use of such minerals back through the global
supply chain.
To ensure that we are not complicit in human rights
violations and environmental destruction, we actively
conduct these surveys, as well as asking our business
partners for their cooperation for the responsible
procurement of mineral resources.

Establishment of BCP
Framework
With the cooperation of our business partners, we holdregular meetings on BCP and promote initiatives toestablish strong procurement and production frameworks,
in order to share BCP policies and frameworks between
the CMK Group and our business partners.

18

Governance

Environment

SocialHuman Rights and Labor
Under the Basic Philosophy, we recognize the diverse values of individuals and respect their humanrights, maximize the potential of every individual employee, foster an environment in which employees
engage in their duties with a sense of reward, and pursue their mental and physical happiness.

CMK Group Human Rights Policy
Based on our management policy of mutual respect regardless of individual attributes, the CMK Group establishedthe Human Rights Policy in accordance with the Guiding Principles on Business and Human Rights, which wasendorsed by the United Nations Human Rights Council in 2011, and other international norms, to protect thehuman rights of all people involved in our business activities.

Human Resources Development (Diversity & Inclusion)
We actively promote the recruitment of diverse personnel and the development of employees’ capabilities,
regardless of gender, nationality, age, and whether or not they have a disability, and aim to create workplaces thatenable each and every employee to work energetically. We also aim to develop human resources who have vitality
and abundant creativity by turning their diverse personalities and values into a force for our organization.

Education programs for human resources development
Our Company formulates various education and training
programs to develop human resources with vitality andabundant creativity. We operate and develop education
programs on a continual basis, taking into consideration
changes in the external environment and risk status based on
essential themes, such as grade-based education, job-based
education, global human resources development, andcompliance education. Education plans are reviewed annuallybased on their effectiveness.

Major education programs
Grade-based education and personnel evaluation
education
Job-based education
Global education (study abroad program inJapan)
Expat candidate education
Grade-based compliance education
Women’s advancement promotion education
Support for self-development and acquisition ofqualifications

Promotion of active participation of diverse human resources
Promotion of active participation of foreign nationals

Promotion of active participation of persons with disabilities

We currently have 30 participating technical interns fromThailand under the Technical Intern Training Program for
Foreign Nationals.
These interns are working hard to improve their language
skills, and three of them have already passed Level 3 of theJapanese Language Proficiency Test.
We are striving to develop a working environment that is
comfortable for foreign nationals and to help them acquire
skills.

We will work to provide working environments where diverse
employees, with or without disabilities, can fully demonstrate
their abilities and work energetically.
(%)
2.6

Employment rate of people with disabilities
2.50

2.5

2.43

2.45

2.4
2.3

2.33
2.33

2.2
2017

2018

2019

2020

2021

(FY)

Promotion of women’s advancement
We have formulated and are engaging in a General Employer
Action Plan under the Act on the Promotion of Women’sParticipation and Advancement in the Workplace, with theaim of realizing a workplace where women can fully
demonstrate their individuality and abilities. With the aim ofincreasing the percentage of women in management
positions, we will also establish an environment where womencan fully demonstrate their abilities, employing various
measures such as actively employing women and actively
promoting women to supervisor (team leader) rank, who willthen become future management candidates.

Promotion of active participation of seniors
With the extension of the retirement age to allow full-time
employees to work until the age of 65, our Company has
been enhancing opportunities for employees who want towork to maintain high motivation and participate actively in theworkplace, regardless of their age.

19Governance

Environment

SocialWork-life Balance
We are establishing and promoting various systems to make working easier for employees and to achieve a good work-lifebalance for our employees.

Balancing work and private life

Rewarding workplaces

We believe that the pursuit of employees’ mental and physicalhappiness is an important factor that leads to the developmentof human resources. We aim to realize a good balance
between work and private life that allows employees to choose
various options, taking each employee’s value awareness andlifestyle into account. Believing that achieving that aim will be a
driving force that underpins our corporate purpose, we plan tocontinue our efforts to establish such an environment. We areenhancing the various systems to allow employees to work
enthusiastically while balancing their work and private life in linewith their own lifestyles. In FY2020, we allowed a portion ofchildcare leave to be taken as paid leave and lifted the age limitof leave to care for sick children to the end of junior highschool. In these ways, we are striving to improve our systems
related to childcare and family care.

In the Personnel (Evaluation) System Reform project in 2021,
we revamped the previous company goals management
system, changing it to a system that clarifies the link between
company goals and individual goals. Also, we are working to
improve fairness and transparency to ensure that the results ofpersonnel evaluations are properly reflected in employees’ pay
and conditions. In doing so, we are working to ensure that
personnel evaluations are conducted properly and that theachievement of goals will give employees a greater sense of
reward for their work.

VOICE

Enhancement of child/familycare leave system

Comments from male employees who took childcare leave
Childcare leave
For employees with children aged up to
three years[First five (5) days of childcare leave arepaid leave]

Although it was only for a short period, taking
childcare leave enabled me to share thechildcare and housework, which reduced theburden on my wife.
At the same time, I experienced for myself how
hard childcare and housework are, and I felt
even more gratitude to my wife. The two of us
will continue to support each other into the
future. (M.K.)

 xemptions and limitations on overtime
E
work
Available until child finishes elementary
schoolSick child care leave
Available until child finishes junior highschool[Paid leave]Thanks to childcare leave, I was able to spend
time with my child. This experience made me
realize anew what a tough job it is to care for achild, but I also enjoyed that time very much.
I also gained a deep understanding of how hardhousework chores that I do not usually do, suchas cleaning and laundry, are.
It was a significant time in terms of my wife andI raising our child together going forward. (Y.O.)

Shorter time work for childcare
Available until child finishes elementary
schoolFamily care leave
Available for up to 365 days for one (1)person in need of family care
Family care leave[Paid leave]

Comment from employee who took family care leave
My mother was assessed as requiring Level 5 care and is
now in a nursing home. Last year, she fell and suffered afracture, so I took family care leave to help her attend
hospital visits.
My family shares the care of my mother, but I sometimes
feel that I want to spend a little more time with her. It isextremely difficult to care for my mother as she ages, but I
hope to continue to make good use of this system andspend time with her. (T.K.)
20

Governance

Environment

SocialHealth and Safety
Ensuring the health and safety of our employees is the foundation that underpins the “Development andLasting Prosperity” of our business. In addition to raising each and every employee’s awareness ofhealth and safety, our aim is for all employees to work together to create safe and comfortableworkplaces that are free from danger, based on the philosophy of safety first in the workplace.

Health and Safety Management Structure
To manifest our company motto and Basic Philosophy, the CMK Group strives through our Safety and Health Policy tocreate a workplace environment where employees can work with peace of mind. As part of this initiative, we have appointed
an executive officer in charge of corporate safety and are actively promoting health and safety activities within the CMKGroup. The Company-wide Health and Safety Committee meets every six months to promote information sharing across the
CMK Group and company-wide activities for preventing occupational accidents.
CMK Group Health and Safety Management Structure
Under the General Safety and Health Manager, we
appoint health and safety officers at each locationand promote organizational initiatives.

President
Executive Officer in
Charge of Safety

Secretariat (Human Resources andGeneral Affairs Department)
CMK Thailand

CMKC(Dong Guan)

CMK (Wuxi)

CMK
Products

KanbaraFactory

Niigata
Factory

Chichibu
Factory

G Station
Factory

SE Center

Head Office

Initiatives for preventing occupational accidents (analysis of causes and reinforcement of countermeasures)
To improve and maintain the workplace safety environment, we share the results of analysis of information about past
accidents from the perspective of preventing similar injuries.
In addition to health and safety patrols that include risk assessments, led by the Health and Safety Committee, we confirm
the current situation, including the status of countermeasures, through head office audits led by the Human Resources andGeneral Affairs Department (concurrently using web-conferencing, etc. due to the pandemic).
Our Thailand factory is working to improve health and safety by holding safety training sessions, which all employees attend,
to educate them about health and safety. In addition, to prevent the recurrence of occupational accidents and raise safety
awareness at our business sites, including overseas, we are working to strengthen occupational accident prevention in the
CMK Group through measures such as holding workshops and displaying posters.

Falls from heights

2%

Burns

2%

Flying/falling
objects

7%
Slips and trips

Crashes and collisions

Poster showing 2022 company-wide health and safety slogan

30%* Selected from a total of 1,324 entries in a competition open to all employees(including overseas locations)

12%
Cuts andlacerations

Types ofaccident

14%
Contact withharmful substances

14%

Crushing, caught
in machinery

19%

Breakdown of Occupational Accidents in FY2021
Safety training session at Thailand factory21

Governance

Environment

SocialOverseas KYT (Risk
Prediction Training) Activities
Our research found that there is a lack of awarenessabout “near misses” and “risk prediction” at ouroverseas locations. For this reason, in FY2021, welaunched a campaign to promote the penetration of
KYT activities, such as “Stop a second to detect nearmisses.”KYT materials used at China factoryStress Checks
We conduct stress checks in Octoberevery year.
As well as encouraging employees totake note of their own stress levels, we
conduct organizational analysis and areworking to create comfortableworkplaces where employees can fully
demonstrate their abilities without being
troubled by stress.

Analysis results of stresschecks in FY2021 revealed
that there are departments inwhich employees feel a highdegree of stress due to a lackof support from theircolleagues and superiors.
We conducted the following
measures and have beenmonitoring their progress.
1. Counseling by external
occupational counselors
2. Communication andcompliance training for
managers
Sample of analysis results

Approaches to COVID-19
In response to the spread of COVID-19 infections, we placed top priority on the safety of our employees, their families, andother stakeholders, and we are working to prevent infections and the spread of disease. We will strive to reduce the risk ofinfection by taking timely and appropriate measures according to the situation that changes day by day. We will put our best
efforts toward the continued provision of products to fulfill our supply responsibilities.

Internal response to the spread of COVID-19 infections- Adoption of government-recommended attendance rates as a guide for hybrid
style of work-from-home and in-person office attendance- Preparation and management of temperature check and movement history data
- Application of strict controls regarding business trips and overseas travel- Thorough implementation of disinfection and social distancing in every workplace- Use of rapid antigen test kits to test for COVID-19 infection prior to visiting
business sites in other prefectures- Recommendations for new-normal lifestyles

Web conference

Promotion of BCP Initiatives (Approach to Fire and Natural Disaster Risks)
The frequency of natural disasters caused by climatechange is increasing markedly, and the damage theycause is sometimes greater than expected. To
reduce the risks of fire and natural disasters, we are
implementing initiatives to ensure safety withthorough preventive activities, while assessing risks
and identifying the status of countermeasures atindividual business locations.

BCP drills at Shinjuku Head Office

22

Fire and disaster evacuation drill at Niigata factory

Governance

Environment

SocialQuality and Safety
We are working to enhance quality and safety so that we can deliver attractive products and services
that give greater satisfaction to customers.

Approaches to Product Quality Assurance
Under of Basic Philosophy of “... manufacture and sell safe
and secure products with awareness and responsibility...,”
we will continue to contribute to society through highly
reliable products that demonstrate innovation, by bringing
together our skills and wisdom in manufacturing.

Product approval system and feedback on malfunctions

To enable our customers to use our products with peaceof mind, we operate a three-step certification system, frommaterial certification to PCB Layer Structure Certification
to factory certification.
In consideration of how our products are used in themarket and the quality assurance periods for each productspecification, we deliver safe and secure products to ourcustomers by conducting reliability tests to a higher
standard.
In the analysis of malfunctions, we have installed various
types of analytical equipment to determine causes andtake countermeasures accurately and quickly. By sharing
this know-how within the Group, we are striving toenhance quality so that we can manufacture products withconsistent quality.
Our reliability testing and analysis lab is accredited as anindependent testing facility for our customers.

CMK Group Quality Policy
1. By complying with the relevant laws and regulations
and responding to the demands and requirements ofcustomers and society, we will conduct open and fair
manufacturing operations.
2. We will enhance the Quality Assurance System bycontinuously improving our Quality Management
System.
3. We will constantly aim at quality improvement throughthe formulation and implementation of action plans forestablishing and achieving quality targets.

Material certification

Quality/Environment Management

Base materials, copper foil, solder resist ink,
symbol mark ink, surface treatment materials

All business locations of the CMK Group have obtained
ISO 9001 certification, the international quality
management system standard, and ISO 14001
certification, the international environmental management
system standard, both of which are recognized globally.
With the CMK Group-wide integrated management
system based on these international standards, we areenhancing our governance in quality and environment
systems.
Currently, we have started to implement Group uniform
standards in compliance with IATF 16949, the quality
standard for automobiles.

PCB Layer Structure certification

Factory certification

Consider product specifications anddifferences between products

Niigata and Kanbara factories, and head office functions,
including sales, development, and engineering
ISO9001/ISO14001 certification

Reliability testing equipment

X-ray analysis equipment

Lock-in infrared heat generation
analysis equipment

Thorough change management
CMKC (Dong Guan) Ltd.
IATF16949/ISO14001 certification

CMK Products Corporation
ISO9001/ISO14001 certification

CMK Electronics (Wuxi) Co., Ltd.
IATF16949/ISO14001 certification

CMK CORPORATION (THAILAND)
CO.,LTD.
IATF16949/ISO14001 certification

Changes in products and manufacturing processes arelikely to have an impact on product quality. For changes in
the 4 Ms (material, man, method, and machine), we haveestablished a management structure under rules
integrated Group-wide that is capable of providing reports
to customers without delay.

Compliance with safety standards
We manufacture and deliver products made with materials
and processes certified by UL, the safety standard of theUnited States.

23

Governance

Environment

SocialResponse to customer needs
To identify the needs of our customers, we create opportunities to understand their opinions, requests, andother matters through customer satisfaction surveys (CS survey) and active participation in trade shows.
We aim to be a company that ensures customer satisfaction through ongoing improvement activities.

Customer Needs Research Activities
Conduct CS survey

Trade show exhibits

We regularly conduct CS surveys in various categories,
such as “products,” “sales,” “quality,” “delivery deadlines,”and “technology.”[Nepcon Japan in Nagoya (physical trade show)] October 2021
We participated in various trade shows to research andcollect customers’ needs. We were able to collect a wide
range of customer
requirements related to
CASE technology andnext-generation
telecommunications
technology targeting various
related fields, such as
automobiles,
telecommunication, andaerospace.

Links to management goals
We have mechanisms in which the improve–check–correct
cycle of processes naturally leads to achieving
management goals and improving customer satisfaction,by incorporating the issues identified by the analysis of CS
survey results into our management goals. Through theselinks, all employees work together to improve customer
satisfaction.

Evaluation of effectiveness of improvement
activities with CS survey

Online response

In response to issues identified by the CS survey, in afollow-up survey, we analyze whether or not any activities
undertaken to improve those issues have been effective.
We hope that this ongoing cycle of collecting, evaluating,and analyzing customer needs and undertaking
improvement activities will lead to improved customer
satisfaction.

[Tokyo Nepcon (live streaming)] January 2022
As the pandemic made it impossible to physically visit thevenue from overseas, the event was delivered online via
live streaming, with simultaneous interpretation provided in
multiple languages(Korean andChinese). Overall,the event was very
well received, withmore than 3,500
viewers and over
7,000 views,
allowing us todirectly exchangeLive streaming withquestions andsimultaneous interpretation
answers withviewers.

Topics
We hold workshops aimed at developing proposals tocustomers and improving sales activities. More than 100
employees from Japan and overseas participated in an
online workshop on business law, which was presented bystaff from CMK Corporation’s Legal Affairs Department.
We ensure thorough compliance by deepening ourunderstanding of basic legal concepts through casestudies.
The impact of the pandemic has changed the style of oursales activities significantly, with the incorporation of
methods such as online business negotiations andmeetings. With more opportunities to communicate via
web-conferencing with distant customers whom we havenot been able to meet face to face, we are working on
improving our employees’ skills so that we can offer abroader range of proposals from the customer’s
perspective.

[Online factory tour and audit]
For customers who are unable to visit due to thepandemic, we offer online factory tours and web auditing.
In anticipation of living with COVID-19, we haveestablished environments that allow us to respond to
customers online, whether they are in Japan or overseas.

Global responses[Participation in South Automotive Conference (SAC)]
in Birmingham, Alabama, October 2021
We participated in SAC, the trade show for products
related to automotive
manufacturing. With various
events held by theorganizers, such as a
B-to-B match making event
and a number of receptions,
we were able to not only
hold business discussions
but also to network withindustry stakeholders.

Commendations from customers

Special Contribution Award at Denso Ten Limited’s
FY2021 Supplier Appreciation Convention.

24Governance

Environment

SocialSocial Contribution
We promote social contribution activities in the belief that it is important for us, as a corporate citizen,
to achieve harmony and co-existence with local communities and to build relationships of trust withthose communities.

Donation to public facilities

by CMK Thailand

In Thailand, the practice of making donations has
firm roots, and CMK Thailand conducts donation
activities as an ongoing initiative. Although these
activities have been restricted due to the pandemic,
CMK Thailand donated plastic panels and pallets to
Prachin Buri Province.

Compost activities

At the Niigata Factory, leftover food from thecanteen is being turned into compost. The G Station
Factory also collects fallen leaves at the factory andgives them to employees and farmers free ofcharge.
In addition to reducing waste and CO2 emissions
from waste disposal, the CMK Group continues toimplement community-based activities.

Other activitiesMay[CMKC (HK)] Cleanup at Dapeng Fortress
June[Niigata Factory] Beach cleanup in Seiro-machi
August[Niigata Factory] Accredited as Eco-office by Seiro-machi
September	[Niigata Factory] Beach cleanup and tree-planting activity inWith people at working facility for people with disabilities
Seiro-machi
	[Kanbara Factory] Donation of discarded home appliances andtire wheels to working facility for people with disabilities[CMK (Wuxi)] Cleanup hike at Huishan, Wuxi
OctoberNovember	[Niigata Factory, Kanbara Factory] Donation of discarded home appliances and tire wheels
to working facility for people with disabilities	[Kanbara Factory] Certified as disaster preparation leader in Gosen City’s
disaster preparation framework[CMKC (Dong Guan)] Cleanup hike at Yin Ping Shan Forest Park
December	[Niigata Factory, Kanbara Factory] Registered to participate in the Eco
Office Commendation System[G Station Factory] Fallen leaves donated to farmers
WinterYear round [SE] Sainokuni Road Support

25

CM)’s cleanup
KC (Dong Guan

hike at Yin Pingrk

Shan Forest Pa

CMK Group Business Bases
Major Business Bases
Overseas Sales Offices
CMK AMERICA CORPORATION
Atlanta, United States
CMK EUROPE N.V.
Geel, Belgium

Overseas Factories
Overseas Sales Offices
Overseas Factories
CMKC (Shenzhen), Ltd.
Shenzhen, China- Wuxi- Dongguan

G Station Factory
Isesaki City, Gunma

China
CMKC (Dong Guan) Ltd.
Dongguan, Guangdong
CMK Electronics (Wuxi) Co., Ltd.
Wuxi, Jiangsu

Niigata Factory
Seiro-machi, Niigata

Kanbara Factory
Gosen City, Niigata

Chichibu Factory
Chichibu City, Saitama

Head Office

Overseas Factories
CMK CORPORATION（THAILAND）CO.,LTD.
ThailandPrachin Buri

SE Center*
Miyoshi-machi, Saitama

CMKC (HK) Limited

Shinjuku-ku, Tokyo

Overseas Sales Offices
CMK CORPORATION（THAILAND）
CO.,LTD.
Thailand Bangkok

CMK Products Corporation
Sagamihara City, Kanagawa

CMK ASIA（PTE.）LTD.
Singapore(Representative Office)Indonesia Jakarta

Sales Office(Japan)点（営業所等）

CMKM SDN.BHD.
Malaysia- Kuala Lumpur- Penang

SE Center*, Nagoya,
Osaka, Hiroshima*Relocated to Kawagoe in July 2022

Major Production Base

Niigata Factory

Kanbara Factory

CMK Products Corporation

CMK Electronics (Wuxi) Co., Ltd.

CMKC (Dong Guan) Ltd.

CMK CORPORATION (THAILAND) CO.,LTD.

26

Performance and Financial Highlights
In FY2021, although the effects of shortages of semiconductors and other components remained uncertain, global
automobile sales recovered, and orders in the car electronics field, the mainstay market of the CMK Group, remained
strong.
Consolidated net sales in the CMK Group increased by 16.5% year-on-year to 81,486 million yen due to an increase insales of car electronics products. In income figures, despite the impact of rising raw material costs, operating income
was 3,021 million yen (operating loss of 1,676 million yen in the previous fiscal year) due to an increase in net sales
and production efficiency improvements. Ordinary income was 3,305 million yen (ordinary loss of 1,511 million yen in
the previous fiscal year) and profit attributable to owners of parent was 2,785 million yen (loss attributable to owners ofparent of 1,868 million yen in the previous fiscal year) due to an increase in operating income and other factors.

Sales by product
Mobile communications
Mobile communications

1.5%

Others1.2%

Information andcommunication

17.2%

Others

17.4%

11.6%

Information andcommunication

Body electronics /climate control

9.0%

27.3%

FY2021

Body electronics /climate control

27.0%Powertrain /driving control and safety

Powertrain /driving control and safety

Car electronics

FY2020

42.2%

45.6%

81.1%

Car electronics

81.6%

Sales by type of PCB

Sales by region

HDI PCBs Double-sided PCBs

Multilayered PCBs Others

Japan

China

Double-sided PWBs

OthersSoutheast Asia

Europe and North America(Million yen)

100,000(Million yen)

100,000

90,23090,23086,89486,894
82,61980,00082,61981,486

26,246
26,941

81,48680,00021,37569,967

69,96721,08450,443

18,46360,00051,52060,00047,216

48,41043,38440,00037,044

41,78442,40140,00044,09636,391

16,796
17,136

15,27014,861
13,094

9,759

12,683

10,606

7,637

7,339

5,747

5,352

5,699

2017

2018

2019

2020

2021

16,067
12,50820,00020,000014,891

14,84914,676
10,133

0

(FY)

27

13,280

6,630

7,064

5,835

3,940

3,728

2017

2018

2019

2020

2021

(FY)

Performance Highlights
Consolidated Fiscal Year

2017

2018

2019

2020

2021

Net sales

(Million yen)

86,894

90,23082,61969,967

81,486

Operating income (loss)

(Million yen)

4,266

3,767

1,601

△ 1,676

3,021

Ordinary income (loss)

(Million yen)

3,917

3,770

792

△ 1,5113,305

Net income (loss)

(Million yen)

3,638

2,015

△ 1,128△ 1,868

2,785

Net assets

(Million yen)

55,892

55,84954,93251,51954,466Equity ratio

(%)

55.5

49.9

53.6

49.8

50.3

(Persons)

4,601

4,990

4,851

4,960

4,854

Number of employees

Profit (loss) attributable to owners of parent is presented as net income (loss).

Net sales

Operating income (loss)(Million yen)

100,000(Million yen)

5,000

90,230Ordinary income (loss)(Million yen)

5,000

4,266

86,894
82,6194,000

81,486

4,000

3,767

3,917

3,770

80,0003,305
69,967

3,021

3,000

60,000

3,000

2,000

2,000
1,601

40,000

1,000

1,000

0

0

△1,000△1,000792

20,000

0

2017

2019

2018

2020

2021

(FY)

Net assets and equity ratio
80,000△1,511△1,676
2017

2018

2019

2020

2021

(FY)

Number of employees(Million yen)(%)
Net assets△2,00064(persons)

6,000

Equity ratio
4,990

4,851

4,960

4,854

4,601
60,00055,892

55,84960
54,932

54,4664,000

51,51940,000

55.5

56

53.6
2,000
20,000

52

49.9
0

2017

2018

49.8

2019

2020

50.3

2021

(FY)

48

0

2017

2018

2019

28

2020

2021

(FY)

△2,000

2017

2018

2019

2020

2021

(FY)

Corporate Data
Name of listedcompany
Date ofestablishment
President andCEO
Capital

CMK CORPORATIONHead OfficeFebruary 1961

Business
description

StocksPrime Market, Tokyo Stock Exchange

Isao Osawa
22,306.2 million yen

Number of
employees
Averageage

6-5-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo, Japan
Development, production and marketing ofvarious printed wiring boards and electronics
devices for consumer and industrial use
1,309 (CMK Group total: 4,854)
46.05

Executives (as of June 28, 2022)
Director and Corporate Auditors

Executive Officers

President and CEO

Isao Osawa

Executive Officer

Junichi Ishibashi

Director and Executive Officer

Kunihiko Tedo

Executive Officer

Takashi Izumisawa

Director and Executive Officer

Yoshihisa Yamaguchi

Executive Officer

Takashi Okayasu

Director and Executive Officer

Yoshiaki Ishizaka

Executive Officer

Kazuhiro Kawaguchi

Director and Executive Officer

Kazuto Ono

Executive Officer

Masanori Kawashima

Director

Tsuyoshi Ukyo

Executive Officer

Masaya Kuriyama

Director

Rika Sato

Executive Officer

Tatsuya Koizumi

Director

Mitsuru Kaitoh

Executive Officer

Satoru Takahashi

Standing Corporate Auditor

Masashi Koike

Executive Officer

Yasuhiko Takahashi

Standing Corporate Auditor

Akihiro Okabe

Executive Officer

Masayoshi Hagiwara

Corporate Auditor

Yuji Yamanashi

Executive Officer

Toshikazu Fujino

Corporate Auditor

Masaki Ashibe

Executive Officer

Naoki Matsuo

History
1959 Noboru Nakayama founded a private company that
manufactured nameplates.

1990 CMK establishes the Niigata Satellite Factory in
Seiro-machi, Niigata, now called Niigata Factory.
CMK invests in CMK Kanbara Electronics Corporation(Gosen City, Niigata).

1961 Incorporation occurs and Chuo Meiban Kogyo Co.,
Ltd. (Suginami-ku, Tokyo) is founded.

1995 CMK relocates its head office to Shinjuku-ku, Tokyo.

1963 Chuo Meiban Kogyo starts PWB manufacturing.

1998 CMK invests in Yamanashi Sanko Co., Ltd. (Nirasaki
City, Yamanashi).

1967 Chuo Meiban Kogyo opens Saitama Factory in
Miyoshi-machi, Saitama, now called SE Center.

2000 CMK establishes CMKC (Dong Guan) Ltd. in China.

1970 Chuo Meiban Kogyo concentrates on PWB
manufacturing.

2001 CMK establishes CMK Electronics (Wuxi) Co., Ltd. in
China.
CMK establishes CMKC (Hong Kong) Limited in Hong
Kong.

1974 Chuo Meiban Kogyo opens Gunma Factory in Isesaki
City, Gunma, now called G Station Factory.
1980 Chuo Meiban Kogyo establishes Chumei Engineering
Co., Ltd. (trade name changed to CMK Mechanics
Corporation) in Chichibu City, Saitama.
Chuo Meiban Kogyo opens CMK Singapore (PTE.)
Ltd., now called CMK Asia (PTE.) Ltd. in Singapore.

2006 CMK establishes CMK Corporation (Thailand) Co., Ltd.
in Thailand.
2007 CMK merges three domestic subsidiaries andchanges its trade name to CMK Products Corporation.
CMK establishes CMK America Corporation in the
United States.

1984 Chuo Meiban Kogyo changes its name to CMKCorporation and relocates its head office to Miyoshimachi, Saitama.

2012 CMK establishes CMKC (Shenzhen), Ltd. in China.

1985 CMK is listed on the Second Section of the Tokyo
Stock Exchange.

2014 CMK absorbs and merges CMK Multi Corporation,
CMK Kanbara Electronic Corporation, Yamanashi
Sanko Co., Ltd, and CMK Mechanics Corporation.

1987 CMK establishes CMK Europe N.V. in Belgium.

2020 CMK absorbs CMK Finance Corporation.
CMK establishes CMKM SDN.BHD. in Malaysia.

1989 CMK is listed on the First Section of the Tokyo Stock
Exchange.

29

Stock Information(As of March 31, 2022)

Total number of shares authorized227,922,000

Major shareholders (10 largest)

Total number of shares issued
and outstanding63,060,164

Shareholders

Number of shareholders7,246

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

9,588

16.1

Custody Bank of Japan, Ltd.
(Trust Account)

5,657

9.5

Mizuho Bank, Ltd.

2,576

4.3

The Foundation for Technology
Promotion of Electronic Circuit Board

2,500

4.2

Custody Bank of Japan, Ltd.
(securities investment trust account)

2,404

4.0

Share trading unit100
Shareholder Breakdown
Individuals andothersOther firms
11,228 thousand shares(17.8%)

Foreigncompanies
andindividuals

12,539thousandshares(19.9%)

Total
63,060,164

9,236 thousand
shares
(14.6%)

Securities firms

Financial

757 thousand shares(1.2%)

29,298 thousand shares(46.5%)

Number ofshares held Percentage(%)(thousands)

Takahiro Nakayama

1,975

3.3

The Dai-ichi Life Insurance Company,
Limited

1,895

3.2

Mizuho Trust & Banking Co., Ltd.,
Retirement
Benefit Trust, Kiraboshi Bank AccountRe-Trustee: Custody Bank of Japan,
Ltd.

1,745

2.9

Akiharu Nakayama

1,668

2.8

Sumitomo Mitsui Banking Corporation

1,613

2.7

Notes
1. Although the Company holds 3,865,040 shares of treasury stock, it is notincluded in the above list of major shareholders.
2. Treasury shares were excluded in calculating the shareholding ratios.

Editorial Policy
About CMK Report

Other basic information about this Report

The Environmental Report, which our Company began publishing in
1999, evolved into the CSR Report in 2007, after which we continued
to disclose and publish activities in the non-financial information area
every year until 2017. Since fiscal 2018, we have added corporate
information, such as financial, executive and stock information, in thereport, and we now produce and disclose this report with the aim ofcontinuously communicating our Company’s activities to various
stakeholders in a format that is easy to read and understand.

Period covered by the Report: April 1, 2021 - March 31,
2022 (however, articles and contents include information
up to June 2022)
Date of publication: September 2022

WebsiteReference Guidelines

This Report and our Environmental Data, which focuses solely on
environmental information, are available on the website.

ISO 26000 Guidance on Social Responsibility
Environmental Reporting Guidelines 2018, Ministry of theEnvironment

https://www.cmk-corp.com/csr/

30

43rd Floor, Shinjuku I-Land Tower Bldg., 6-5-1
Nishi-Shinjuku, Shinjuku-ku, Tokyo 163-1388, Japan
Tel.: +81-3-5323-0231 (main)
https://www.cmk-corp.com

The CMK Report uses vegetable-based inks and FSC-certified paper. It is printed with a “waterless printing method” that
does not produce harmful waste fluids during the printing process and is bound in an environmentally friendly manner.