Sustainability Report2022

UD Trucks Corporation

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

1

UD Trucks at a glance
For 87 years, UD Trucks has provided the trucks and transportation solutions the world needs today,
forever challenging and innovating for a better tomorrow.

18,851

Sales and servicing in

60

countries

87

truckssold globally in 2021

UD Trucks’ extensive network of dealers offers sales and servicing inroughly 60 countries. The UD Trucks Group provides 24-hour, 365-day
support to commercial vehicle operators and drivers, including atelematics service connecting about 80,000 trucks around the world.

UD Trucks sold 18,851 trucks in 2021, meeting a wide range of local
transport needs with its diverse lineup of truck models. Japan is thelargest market for UD Trucks.

Asia

MiddleEast

Americas

15

20.6

15

19.9

18.9
15.5

9

6,146

8,122

Outside Japan:

employees

1,976With employees from 41 countries working worldwide (31 nationalities
based in Japan alone), UD Trucks recognizes that promoting a diverse
workplace in which all employees can make the most of their abilities
will lead to its continued success.
Note: Figures as of April 1, 2022.

Africa17

Diverse workforce of
In Japan:(Thousands)

20.6

years of history

Founded in 1935 as a diesel engine manufacturer, UD Trucks has
always been a challenger at heart, responding to the needs ofcustomers and of the times.

Oceania

3

2017

2018

2019

2020

2021

165

customer centers andindependent dealers in JapanThe Company’s nationwide network of customer centers and dealers
provides genuine parts and servicing to keep customers’ trucks
running and maximizing uptime.

Kazet light-duty truck

Condor medium-duty truck

Sold in developed markets

Quon heavy-duty truck

Quester heavy-duty truck

Croner medium-duty truck

Sold in emerging markets

Kuzer light-duty truck

Sustainability Report 2022

UD Trucks at a GlanceContents
UD Trucks at a Glance

1

Message from the President

3

Our Purpose

4

Sustainability Activities• Better for Logistics• Better for the Planet• Better for People• Better for Business
About UD Trucks Corporation

7
16
25
31
38

About this report
UD Trucks publishes a sustainability report every year forthe purpose of providing stakeholders with information
about its environmental, social and governance initiatives.
Scope of the report
This report covers the activities of UD Trucks Corporation.
Reporting period
This report mainly covers results and activities in fiscal
2021 (January 1 to December 31, 2021). Some sections
also refer to results and activities in previous fiscal years,
activities in fiscal 2022, and future plans and forecasts.
Published December 2022

Contents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation2

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

Message from the President

Our diverse employees around the world are
helping make logistics more sustainable.
Guided by its Better Life purpose, UD Trucks isdeveloping products and technologies that realize

the planet, we look forward to the continued

striving to grow together with its stakeholders while

exceptional environmental performance, help

support of the Company’s stakeholders.

offering solutions through its business activities. By

customers increase uptime, and improve driving

pursuing initiatives that are better for logistics, theconditions for truck drivers. For example, UD Trucks

planet, people, and our business, we are aiming toequips its flagship Quon heavy-duty truck models

become the sustainability leader among Japanesewith its fuel-efficient GH engine and ESCOT-VI

commercial vehicle manufacturers.

electronically controlled automatic transmission, as

The world is confronting all kinds of major

well as UD Active Steering, which helps reduce

challenges today, from climate change and resource

driver fatigue. We have also begun introducing

depletion to widening economic disparities andtrucks that comply with the Euro 5 vehicle emission

human rights issues. It is essential to proactively

standard in emerging countries.

address these challenges and reduce risks

As a member of the Isuzu Group, UD Trucks isthroughout the value chain while working to help

now aiming to achieve net zero CO2 emissions byachieve the UN Sustainable Development Goals. At

2050 in accordance with Isuzu Environmental

the same time, the logistics industry must improve

Vision 2050. To accomplish this goal, ideas andtransport efficiency and address the serious shortage

contributions from all employees worldwide areof truck drivers as the growing use of e-commerce

more valuable than ever. Therefore, we aresites drives up demand for delivery services.

fostering workplaces that help employees maximize

At UD Trucks, we are keenly aware of theseissues and our role as a provider of trucks andservices in the industry. Accordingly, we are

their potential while promoting diversity, equity,and inclusion.
As we work to make life better for people andKouji Maruyama
President and Representative Director
UD Trucks Corporation3

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

Our Purpose

PurposeOur desired position by 2025

Better Life
Better Life is our purpose, the reason why
we exist. Providing the trucks and services
that the world needs today, we arecommitted to Better Life—to make life
better for people and the planet throughsustainable transport solutions

Leadership in sustainability
across four areas
Better for Logistics:

The leader in sustainability
among Japanese commercial
truck manufacturers

Pursuing smarter logistics
to overcome challenges
facing the industry

Better for People:
Creating better
workplaces andsupporting communities

Better for the Planet:
Reducing emissions
and waste

Better for Business:
Building a foundation
for sustainable growth

For over 80 years, UD Trucks has been providing the trucks and services the world needs today.
Now the logistics industry is facing an array of challenges, from a shortage of truck drivers and higher demand fordeliveries driven by the growth in e-commerce, to environmental impacts such as climate change and resource depletion.
To overcome these many challenges, innovation and collaboration are essential for making the world a better place.
We are committed to making life better - for people and the planet. This is our purpose, and we call it Better Life.
Guided by our Better Life purpose, we aspire to be the leader in sustainability among Japanese commercial
truck manufacturers by 2025.
Customers

Engaging with Stakeholders

By working to make life better for people and theplanet, UD Trucks recognizes the importance ofhelping achieve the UN Sustainable Development
Goals, which were adopted by the United Nations
General Assembly in 2015.

For UD Trucks to be a sustainability leader among Japanese commercial truck
manufacturers, close communication with all stakeholders is essential, including
customers, business partners, and employees. Therefore, the Company creates
opportunities to engage with stakeholders and reflects their views in its management
policies, business activities, and environmental, social, and governance (ESG) initiatives.

Business
partners

Employees

UD Trucks
Industryorganizations

Communities

Regulatory
bodies4

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

5

Our Purpose

Leadership in sustainability across four areas
Better for Logistics:

Better for the Planet:

Pursuing smarter logistics to overcome challenges facing the industry

Reducing emissions and waste

Globally, the logistics industry is facing various challenges, including a shortage of drivers,
increasingly strict regulations, and the need to ensure safer roads. Moreover, the growing
e-commerce sector coupled with intense competition is putting pressure on logistics firms
to cut costs and improve efficiency.
UD Trucks is meeting these challenges head on by staying at the forefront of innovationthat helps improve vehicle efficiency, reduce environmental impacts and maximize driver
comfort. To become a leader in sustainability, UD Trucks continues to develop
next-generation technologies in the fields of connectivity, electromobility, and autonomous
driving. At the same time, the Company is offering solutions to partners and customers toenhance their business.

Climate change and resource depletion are some of the most pressing environmental issues
facing us today. UD Trucks, together with the logistics industry as a whole, can be part ofthe solution to greatly minimize environmental impacts.
UD Trucks is taking steps to significantly reduce CO2 emissions and eliminate waste
across its operations. Accordingly, the Company is exploring the use renewable energy andreducing the CO2 footprint of its products and sites, while collaborating with suppliers to
reduce environmental impacts across the entire value chain.

For more details, please refer to page 7.

For more details, please refer to page 16.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

6

Our Purpose

Better for People:

Better for Business:

Creating better workplaces and supporting communities

Building a foundation for sustainable growth

Recognizing that people and communities are a core part of its sustainability strategy,
UD Trucks helps its employees enhance their well-being while fostering a workplaceculture that values diversity, personal development and a strong work-life balance. All
employees are encouraged to make the most of their abilities and given the opportunity
to grow professionally.
In addition, UD Trucks works closely with communities, focusing on road traffic safetyseminars for local schools, disaster relief and other community outreach initiatives.

Pursuing a sustainability strategy that is Better for Logistics, Better for the Planet and Better
for People helps secure the fourth area of sustainability: Better for Business. In short, thismeans the Company’s performance and profitability. UD Trucks invests profits back into its
businesses to lay a path for it to grow together with all stakeholders.

For more details, please refer to page 25.

For more details, please refer to page 31.

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for Logistics
UD Trucks deploys innovative in-vehicle
systems to provide trucks that maximize
driver comfort and driving efficiency while
also helping to reduce environmental
impacts. Working in partnership with truck
drivers and logistics firms, the Company
devises comprehensive solutions acrossthe entire value chain. By developing
next-generation technologies in the fields
of connectivity, electromobility, andautonomous driving, UD Trucks is working
to make logistics smarter and moreenvironmentally sustainable.

7

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

8

Better for Business

Sustainability Activities

Enhancing comfort andsafety for drivers
UD Active Steering system developed
for heavy-duty trucks
Japan is currently facing a shortage of truck drivers, mainly
because the work can be physically demanding and often
involves long hours. Drivers spend most of their working
days inside a truck cab, so enhancing drivability is crucial.
With this in mind, UD Trucks developed UD Active
Steering to help reduce driver fatigue and make roads
safer. Available on heavy-duty Quon models in Japan, UD
Active Steering is designed to improve steering precision
under all kinds of driving conditions. Steering is assisted byan electric motor installed over conventional hydraulicsteering gears. Attached to the motor is an electronic
control unit that monitors the vehicle direction and driver’s
actions, while vehicle movements and road conditions aredetected by numerous sensors at a rate of 2,000 times per
second, providing real-time assistance to the driver. It also
reduces steering wheel resistance by applying anappropriate amount of torque. This makes steering feel
stable regardless of the truck’s speed, payload, roadconditions, and crosswinds.
Electronic control unit

Hydraulic power
steering unit

Five benefits of UD Active Steering• Low Speed Agility
When turning at low speeds and reversing in tight spaces,
additional steering torque automatically feeds into thesystem to allow the driver to maneuver with a light touch.
• High Speed Stability
When driving at higher speeds, the weight of thesteering wheel adjusts to provide superior stability.
• Rough Road Dampening
UD Active Steering dampens vibrations on rough roads.
Minute directional adjustments keeps the driver on course.
• Cross Wind Correction
UD Active Steering virtually eliminates the steeringcorrections needed in crosswinds, keeping the driver ona straight course.
• Return to Center
Whether turning at an intersection or reversing, thesteering wheel will return to center when released, saving
driving effort and bringing the vehicle into a straight line
quickly and easily.

UD Active Steering demonstration
shown online
UD Trucks strives to improve working conditions forcommercial vehicle drivers and address the shortage oftruck drivers in Japan. With this in mind, the Company
demonstrated how the UD Active Steering system helps
reduce driver fatigue and improve transport safety at theAgeo Plant’s test course in July 2021. Although the event
was held online due to the COVID-19 pandemic, thedriving demonstrations were based on practical situations,such as driving on a winding course and uneven surface,and reversing into a parking garage. The drivers shared
their impressions of the UD Active Steering system in theirown words, providing viewers with practical information.
Following the demonstration, the Company beganoffering customers opportunities to test drive trucks
equipped with UD Active Steering.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

UD Active Steering—what drivers had to say

UD Active Steering made driving easier,allowing us to pay closer attention to the road
Kotoh K.K.
Hitoshi Ikeda, vehicle maintenance manager
My company transports automotive parts and equipment
throughout Japan using 64 medium- and heavy-duty trucks.
My job mainly involves inspecting the trucks and getting
them road-ready. When purchasing a new truck model, we
take the experiences of our drivers into account. We hadheard a frightening incident about a driver losing control ofthe steering wheel when the truck got caught in a rut of an
old road. Another lost control of the wheel in snowy

weather. After considering such feedback along withvarious other factors, we decided to purchase a truckequipped with UD Active Steering.
When I first drove a truck with this steering system at atest drive event, I was surprised how the steering wheel did
not wobble at all when I drove over a bumpy surface. The
Quon’s steering wheel also felt lighter than those of aregular four-axle heavy-duty truck.
Our first driver to try UD Active Steering, Hirokazu
Harada, had many good things to say about the system(see below). Given his assessment, we will certainly
consider acquiring more of these trucks in the future,
because we want our drivers to be able to drive long
distances with as little stress as possible.

Hirokazu Harada, truck driver
I drive a heavy-duty truck over long distances, and roadconditions constantly change. Even on the same road, I
need to adjust how I drive depending on the season andweather. For example, on a snow-covered road, I need towatch my speed and be careful when using the brakes.
When driving the Quon equipped with UD Active
Steering, the steering not only feels light but also stable athigh speeds. Other power steering systems have madesteering easier over the years, but I still needed to be
Hitoshi Ikeda driving a Quon heavy-duty truck.

careful when driving at higher speeds. The Quon, however,is more relaxing to drive, because the steering becomes
heavier as the speed increases and feels steady when I maketurns. On streets in urban areas, turning at intersections iseasy. Normally in a big truck, it can be difficult to make aleft-hand turn properly if you steer sharply a little tooquickly or too slowly, especially on a narrow street. Now I
can make those turns smoothly, which gives me more time
to check for oncoming bicycles and motorcycles on my
opposite side.
Having UD Active Steering gives me peace of mind
when driving routes where crosswinds tend to be strong.
A driver shouldn’t rely entirely on the steering system, ofcourse, but if it helps detect unpredictable crosswinds, thetruck really feels like a dependable partner.
In the past, I had to tightly grip the steering wheel
when driving at high speeds, but now I just hold it normallyto keep the truck steady, which makes driving much more
comfortable. After a long day on the road, I am not nearlyas tired out as before.
.

9Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

10

Better for Business

Sustainability Activities

Level 4 autonomous driving trial with
Kobe Steel

Improved safety functions of Quon
heavy-duty trucks

Participation in a government initiative tosupport the logistics industry

As Japan’s logistics industry struggles with a chronic labor
shortage, manufacturers are concerned about how thelack of truck drivers will impact their operations. To help
find new solutions for these issues, UD Trucks has been
focusing on developing fully electric and autonomous
trucks under its roadmap for innovation, “Fujin & Raijin.
Vision 2030.” As part of these efforts, it has been verifying
the feasibility of self-driving heavy-duty trucks used forspecific applications.
For example, in 2019, the Company demonstrated aself-driving truck equipped with Level 4* autonomous
driving technology in Hokkaido together with the logistics
firm Nippon Express and the Hokuren Federation ofAgricultural Cooperatives. The test verified that the truck
could make deliveries on a planned route.
More recently, UD Trucks concluded an agreementwith Kobe Steel, Ltd., in 2022 to conduct autonomous
driving trials at the steelmaker’s Kakogawa Works, wheretransport must be reliable to keep blast furnaces operating
24 hours a day, 365 days a year. An on-site test course has
been prepared to demonstrate Level 4 autonomous drivingusing a Quon heavy-duty truck.

Quon heavy-duty trucks come with the Company’s
proprietary safety functions, including its Lane Departure
Prevention function, Lane Departure Warning System,
Traffic Eye Brake system, which automatically brakes toprevent collision damage, and Driver Alert System, which
sends warnings based on steering irregularities. Based on
advanced technologies, these systems help drivers operate
the trucks safely, which keeps the road safer for everyone.
In addition to these functions, UD Trucks added UD
Active Steering in 2021. This electronically controlledsteering system helps reduce driver fatigue, one of thecauses of traffic accidents. The Company then equipped its
2022 models with two new safety functions: Blind Spot
Information System, an advanced function that detects
bicycles on the left side of the truck when the driver makes
a left turn, and Lane Change Support, which detects
oncoming vehicles on the left side when the driverchanges lanes. Both functions alert the driver via an
indicator mounted on the windshield pillar of thepassenger seat side of the cab. If the possibility of acollision is detected, the indicator flashes, a buzzer sounds,
and a warning appears on the dashboard panel.
Pursuant to international standards set in November
2019, truck manufacturers are required to install a systemfor detecting blind spots in trucks weighing over eight
tonnes effective from May 2024. The Blind Spot
Information System is the first such system to be featured
in a heavy-duty truck model in Japan, demonstrating theCompany’s success in complying with safety standards
ahead of the industry.

Recognizing that it is not only a manufacturer of trucks thatare essential for commercial transportation but also a userof logistics services, UD Trucks strives to contribute to moresustainable logistics. From this standpoint, the Company isproactively endorsing the Japanese government’s programfor raising the productivity of trucking, and improving
workplace conditions and efficiency in the logistics industry.
This initiative (called the White Logistics Movement in Japan)
was launched in March 2019 by the Ministry of Land,
Infrastructure, Transport and Tourism.

* The vehicle can fully operate in self-driving mode under predefined conditions

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

11

Better for Business

Sustainability Activities

Reducing environmental impacts
Improving the environmental performanceof Quon heavy-duty trucks
When UD Trucks debuted its Quon model in 2004, thetrucks were the world’s first to feature a selective catalytic
reduction system for purifying exhaust gases. Since then,the Company has been improving the fuel efficiency andenvironmental performance of the Quon by applying
leading-edge technologies, including its ESCOT-VI
12-speed electronically controlled automatic transmission,
designed to help drivers save on fuel, the Foretrack speed
adjustment system, which scans and predicts road inclines,
and Nenpi Coach, a system that provides drivers with
fuel-saving advice.
In July 2022, UD Trucks released an 11-liter
engine-powered Quon that meets new Japanese fuelefficiency standards set to go into effect from 2025. Under
these new standards, fuel efficiency must be improved byover 10% compared with standards set in 2015 by the
Ministry of Land, Infrastructure, Transport and Tourism.

about 10%. The engine also produces considerable torquefrom low RPM through to a wide range of speeds,
providing drivers with extra power when needed.
• ECO+ mode cruise control
UD Trucks added a fuel-efficient ECO+ mode to its cruise
control system’s ECO and ECO Off modes. ECO+ is set as
the default when the engine starts, and drivers can thenswitch between the three modes depending on how much
power they need.
• Long-lasting engine oil and tires
The new Quon trucks run on low-viscosity engine oil thathelps preserve engine life, and are fitted with low rolling
resistance tires that realize better fuel efficiency.

New truck models compliant with Euro 5
vehicle emission standards
In September 2021, UD Trucks released Quester heavy-duty
and Croner medium-duty truck models that comply with
the Euro 5 vehicle emission standard for the European
Union. Now available in major markets around the world,

Main environmental features ofthe 2022 Quon 11-liter engine• GH11 engine
For this new engine, UD Trucks redesigned the combustion
chambers and developed a new fuel injection system thatcombines the unique benefits of unit injector and common
rail systems. Thanks to these features, new Quon trucks
equipped with the Company’s ESCOT-VI transmission
comply with Japan’s 2016 exhaust gas regulations andoutperform the country’s 2015 fuel efficiency standards by
From left, Croner and Quester model trucks

these new models boast features that improve uptime andfuel efficiency, optimize the total cost of ownership forusers, and help lower environmental impacts.
UD Trucks has released these new models in emerging
markets, which have been rushing to adopt more stringent
emission standards in response to worsening air quality
caused by industrialization and rapid economic growth, aswell as to climate change. Since the Euro 5 standard
requires NOx emissions to be reduced by 43% comparedwith the Euro 4 standard, these Euro 5 compliant trucks
will benefit efforts in these markets to tackle
environmental issues and reduce related risks.
Besides complying with the Euro 5 standard, these
Quester and Croner models offer substantially higher fuelefficiency because they are equipped with the Company’s
selective catalytic reduction system, which is highly
regarded as the world’s first such system for purifying
exhaust gases. They also come with Nenpi Coach, a systemthat provides drivers with real-time advice on how to
maximize fuel efficiency and optimize driving techniques.

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

12

Better for Business

Sustainability Activities

Improving operational efficiency
for customers
Deploying vehicle telematic data tominimize vehicle downtime
Trucks are used for over 90% of all goods transported
inside Japan on a tonnage basis. From that perspective,society depends on UD Trucks to help its customers keep
their trucks up and running.
Toward this end, the Company deploys its original
telematics service to facilitate safe truck operations forcustomers. Through this service, the Company collects andanalyzes real-time data transmitted automatically via atelematics system installed inside the vehicle, and remotely
provides users with these diagnostic results to help them
operate their trucks safely. The data includes informationon the vehicle’s status, engine condition, fuelconsumption, and location. In the event of a breakdown,
UD Trucks promptly verifies the truck’s condition andinforms the driver of the nearest dealer, thereby
minimizing vehicle downtime. The service also provides
users with a fuel efficiency report, a useful tool for
facilitating more fuel-efficient driving.
In addition, UD Trucks has been using various types ofdata collected from the trucks for the purpose of
preventative maintenance. By identifying signs of potential
vehicle breakdowns and averting such problems fromoccurring in advance through preventative maintenance,
the Company aims to reduce unexpected breakdowns tomaximize uptime.

UD Road Support
A one-stop service for customers provided by theCompany’s call centers, the UD Road Support team isavailable 24 hours a day, 365 days a year, to immediately
respond to enquiries and requests from truck drivers. If a
truck breaks down on the road or has an accident, theteam checks the vehicle’s condition using data transmitted

Cold weather tests
Commercial trucks are essential for keeping society moving,so they must be durable and dependable enough to run
in practically any environment. From this standpoint, UD
Trucks strives to supply vehicles that consistently perform
well on the road and can hold up under extreme weather
and road conditions. To ensure this level of durability, theCompany has been testing its vehicles in extremely cold
weather since 1985. The tests are carried out every year
from January to March in Hokkaido, Japan’s northernmost
region, in cooperation with the city of Kitami.
The tests are designed to verify that a truck can
operate dependably in an extremely cold environment,
where temperatures of -20°C are not uncommon. The
test results are then used to improve vehicle safety andoperability. A wide range of factors are evaluated, including
the truck’s ability to safely start, run, and maneuver on awinding course in a cold area, the truck’s operational status
after been covered in water in sub-zero temperatures, andin real time via the Company’s telematics service, andshares the information with a mechanic from a dealer
nearest to the vehicle. Call center staff then promptly
dispatch the mechanic to repair the vehicle, and provide
necessary information to the truck driver, such as theestimated time of arrival of mechanic.

its ability to start moving and operate on slippery roadsurfaces. The heating system’s operability when the truck iscovered in snow during freezing temperatures, and theperformance of the engine and exhaust gas purifier system
under low temperatures are also verified.
By checking and collecting data on these items every
year, UD Trucks is working to develop highly reliable
vehicles that customers can trust, even in the harshest
winter conditions.

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

13

Better for Business

Sustainability Activities

Quality
ISO 9001 certification acquired
UD Trucks complies with the ISO 9001 international
standard for quality management systems. The Company’s
Manufacturing Division acquired ISO 9001 certification in
2002, followed by the Product Development Division in
2016. Both divisions completed
the transition to the revised ISO
9001:2015 standard in 2018.
Outside Japan, the certification
has been acquired by the
Bangkok Plant in Thailand andthe Pretoria Plant in South
Africa. All certified workplaces
thoroughly conduct aplan-do-check-act (PDCA) cycle
to continuously raise quality inaccordance with the standards.

Internal and external audits of quality
management
As a rule, UD Trucks conducts an internal audit of its quality
management system every year to ensure that it functions
effectively. During the audits, a team of qualified audit
committee members verify and evaluate whether thesystem is being properly implemented and complies withcompany rules as well as relevant laws and regulations.
Likewise, the quality management system is audited every
year by a third party in order to maintain ISO certification.

Measures for promptly dealing withquality-related issues
To minimize the impact of quality-related issues forcustomers, UD Trucks has established a Quality Action
Group spanning across departments involved in productdevelopment, manufacturing, and aftermarket services. The
group is comprised of teams that handle troubleshooting at
headquarters, teams that provide technical support at
dealers and customers’ sites, and branch office teams that
directly respond to problems in their respective areas. These
teams coordinate their efforts to quickly identify root
causes and implement solutions. Through thisarrangement, they promptly share quality-related
information and respond to issues, ultimately leading togreater customer satisfaction.
In 2022, this organization was enhanced andconsolidated into a single division tasked with overseeing
quality management throughout the Company. Thisdivision is working to improve quality and monitor abroader scope of relevant operations with greater precisionand speed.

Product development quality standards
UD Truck’s Product Development Division has established its
own standards for quality assessments. Based on thesestandards, the division specifies checkpoints at each stage of
product development and confirms whether targeted levelsof quality are achieved across a broad range of indicators,
including a truck’s performance, functions, durability, andreliability. This process not only ensures higher quality but also
shortens the total time required for product development.
Recognizing the growing importance of promptly andefficiently obtaining information relevant for quality control,
UD Trucks has been using wearable cameras and utilizing
various other digital devices to collect maintenance andrepair data on vehicles with defects. The Company has also
begun using business intelligence tools to digitize analyticalprocesses, enabling it to more effectively identify quality issues.

Quality assurance in manufacturing
Based on UD Truck’s own quality management procedures,the Manufacturing Division conducts daily inspections ofprocured parts and manufactured items to check for quality
defects throughout the production process and ensure
targeted levels of quality. Refined through continuous
improvement over several years, these quality management
procedures have been adopted by all UD Trucks production
plants worldwide.
In recent years, the Company has begun deploying
digital tools for equipment inspections that were previously
performed manually. With these tools, facilities aremonitored in real time and risks of breakdowns andmalfunctions are assessed and analyzed in advance.
Preventative maintenance and repairs are also carried out
when necessary. As part of its preventative quality control
practices, the Company has been improving the traceabilityof parts at both the manufacturing and transport stages.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

14

Better for Business

Sustainability Activities

Improving the skills of aftermarket
service staff
UD Trucks strives to maintain and raise the quality of its
aftermarket services by organizing events that enhance theskills of staff handling repair work, parts procurement, andfront-office duties at its dealers. Among these events, theCompany’s annual Uptime Conference provides aftermarket
service staff across Japan with technical support andquality-related information about new products. At the event,
best practices are shared and discussions held not only amongstaff on the front lines of aftermarket services, but also
members from the Company’s divisions in charge of productdevelopment, manufacturing, procurement, and logistics.
Another event is the UD Gemba Challenge, a skills
competition for aftermarket service teams from around theworld. Held every two years, the event spans over a period
of about six months, during which team members learn
and demonstrate practical skills that are frequently
required on the job. By taking on new challenges, theparticipants gain new knowledge and technical expertise.
In 2022, 2,161 employees of the UD Trucks Group
worldwide participated in the competition.

Recalls and servicing of defects
In the event of a vehicle defect that could potentially affectcustomer safety or the environment, UD Trucks promptly
discloses all relevant information in accordance withguidelines issued by Japan’s Ministry of Land, Infrastructure,
Transport and Tourism.
Number of vehicle defects reported in Japan
2019

2020

2021

UD
TrucksVolvo
TrucksUD
TrucksVolvo
TrucksUD
TrucksVolvo
TrucksDefects
resulting inrecall

10

5

8

1

17

1

Defects
requiring
improvement

0

0

0

0

0

0

Defects
requiring
servicing

3

2

0

1

3

3

Supporting our customers
Test drive events and workshops forfemale drivers
Amid a shortage of drivers in Japan’s logistics industry, UD
Trucks began holding test drive events and workshops forfemale drivers in 2017, with the aim of gaining direct
feedback from women in the industry. While activities
were suspended in 2020 and 2021 due to COVID-19, theCompany held test drives and workshops in March 2022,
attracting female drivers from all over Japan. The participants
drove a Quon heavy-duty truck, and were particularly
impressed by UD Active Steering, which helps reduce
driver fatigue and improve safety, as well as the ESCOT-VI
electronically controlled automatic transmission.
In the workshops, the participants discussed various
topics, including diversity and working conditions in thelogistics industry, and the future development of trucks
and equipment. Female engineers from UD Trucks alsojoined the discussions.
By applying its leading-edge technologies to develop
trucks that are safe and easy to drive for women and new
drivers alike, UD Trucks aims to help increase the number ofdrivers in the industry by promoting working conditions thatare welcoming for anyone, regardless of gender or age.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

15

Better for Business

Sustainability Activities

Eco-driving and safe-driving seminars
UD Trucks has been holding eco-driving and safe-driving
seminars for truck drivers since 2007. The eco-driving
seminars are designed to equip drivers with practical skills
and knowledge about how to improve fuel efficiency whiledriving. During the seminars, truck drivers learn andpractice fuel-saving techniques for maneuvering anddecelerating. The seminars also make use of theCompany’s telematics service, a wireless communications
system for collecting and analyzing data on a truck’s
location and movements, enabling evaluations of vehicle
speed, gear changing, and other driving-related factors.
Participants have found this to be very insightful andhelpful for understanding their driving habits and making
improvements accordingly.
The safe-driving seminars cover a broad range of
topics, including safe management systems for transport
operators, the dangers of driving under the influence ofalcohol, blind spots, preventing common accidents,
defensive driving, and reducing human error. The programs
combine lectures with hands-on training so that drivers
can immediately acquire practical skills. Videos of actual
accidents taken with drive recorders are also used to give
participants a better sense of how accidents happen.

UD Trucks has been holding its eco-driving andsafe-driving seminars online since 2020 as part of its
measures to limit group discussions and events in order toprevent the spread of COVID-19.

Prompt customer service
UD Trucks has established a customer service call center
made available with a toll-free telephone number forcustomers to ask questions, provide feedback and makerequests. It has also prepared a guidebook explaining
responses to all foreseeable inquiries to help the center’sphone operators effectively deal with customer inquiries.
The center’s procedures and operations are regularly
reviewed to ensure that it continues to provide prompt
and helpful customer service. In 2021, the center handleda total of 3,215 calls compared with 3,917 in 2020.

Number of seminars held annually and participants
2019

2020

2021

SeminarsParticipants

SeminarsParticipants

SeminarsParticipants

Eco-driving seminars

70 locationsin Japan

1,119

10

288

29

464

Safe-driving seminars

146

4,264

46

2,053

119

7,012

Partnering withindependent dealers
Support for maintenance and repair staff
In addition to its own network of dealers, UD Trucks
supplies products and services to customers through six
companies that operate a total of 32 independent
dealerships in Japan. While respecting the corporate
traditions and local business practices of each of thesedealerships, UD Trucks works closely with them towards thecommon goal of improving customer satisfaction, and invites
them to the same training programs and events as its own
dealers to help their employees acquire more skills andexpertise. Every year, many maintenance and repair staff fromthese independent dealerships participate in the Company’s
Uptime Conference and UD Gemba Challenge (see page 14).

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for the Planet
UD Trucks is taking steps to significantly
reduce CO2 emissions and eliminate waste.
Accordingly, the Company is making useof renewable energy sources and reducing
the CO2 footprint of its products andworkplaces, while collaborating with
suppliers to reduce environmental impacts
across the entire value chain.

16

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

17

Better for Business

Sustainability Activities

Towards decarbonization
Reducing CO2 emissions acrossbusiness activities
In line with its Better Life purpose, UD Trucks regards
decarbonization as an important challenge and, therefore,takes proactive steps to reduce CO2 emissions throughout
its operations. Since its production plants, in particular,
consume large amounts of energy, the Company has beenstreamlining manufacturing processes and centralizing
production lines and equipment, to reduce overall energy
usage and associated CO2 emissions. To accelerate these
efforts, the Company’s Ageo Plant has been purchasing
electricity from renewable sources, installing LED lighting
systems equipped with motion detectors for automaticallyturning off lights, switching to electric vehicles and forklifts
while decreasing the total number of its vehicles, andupgrading to more efficient equipment in general. Outside
Japan, the Bangkok Plant has recently installed solar panels
on its rooftop.
Looking ahead, as a member of the Isuzu Group, UD
Trucks aims to reduce CO2 directly emitted from its
business activities to zero by 2050 in accordance with
Isuzu Environmental Vision 2050.
Purchasing electricity from renewables
The Ageo Plant has been purchasing electricity derived
from renewable energy sources since May 2019, andincreased the amount from these sources in 2020 when it
replaced electricity previously supplied by its cogeneration
power equipment. By using electricity from renewables
instead of non-renewable sources, the plant effectively

reduced its CO2 emissions by 1,215 tonnes in 2020 andanother 1,100 tonnes in 2021.
In addition, the Company’s training center, which isadjacent to the Ageo Plant, concluded an agreement in
September 2022 to purchase electricity entirely from net
zero carbon sources.
Installing LED lighting and efficient equipment
The Ageo Plant began replacing obsolescent lighting
equipment with LED lighting systems in 2017. In 2021, it
installed around 2,500 LED lights and removed about 200
fluorescent and other aging lights following a review of its
lighting layout.
In addition, the Ageo Plant upgraded a compressor toa more efficient model in December 2021, thereby
improving the efficiency of its operations.
Adopting on-site solar power
In June 2022, UD Trucks Thailand installed a solar powersystem on the rooftop of its Bangkok Plant with capacity
to generate 1,477 megawatt hours annually. Consequently,
around 25% of all energy consumed by the plant now
comes from renewables, and its CO2 emissions can be
reduced by approximately 700 tons per year.

Saving energy with heat reflective paintIn April 2022, solar heat reflective paint was applied to theroof and exterior walls of the Gunma Parts Distribution
Center, the largest of the Company’s four parts distribution
facilities in Japan. As a result, the indoor temperature isabout 7.5°C cooler during the summer, allowing thecenter to significantly reduce energy for air conditioning
while keeping the temperature below 30°C.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

18

Better for Business

Sustainability Activities

CO2 emissions
Total emissions

Emissions per vehicle(Thousand tonnes of CO2 emissions)(Tonnes of CO2 emissions per vehicle)

150

10

120

8

140

90

6

60

4

30

2

55
1990

2013

24

29

0

2017

2018

23
2019

21
2020

20

0

2021

CO2 emissions by energy source
Electricity
Heavy oil
Liquified petroleum gas

Coke
Other

Diesel oil

City gas(Thousand tonnes of CO2 emissions)

0.5%
5.3%
5.9%

140
0.2%
0.03%
33.7%

12.4%
14.7%

18.1%

17.5%

2.2%
20

43.7%

45.8%
1990

2021

Scope of operations
Amounts shown in the graph are combined results from the Ageo Plant andGunma Parts Distribution Center from 2018 to 2021, and include resultsfrom other facilities up to 2017

Reducing CO2 emissions
over the product life cycle
UD Trucks assesses and works to reduce CO2 emissions
across the entire life cycle of its vehicles, from raw
materials procurement through to the disposal andrecycling of parts and components. The Company places
great importance on these initiatives in consideration of
the fact that commercial-use trucks account for about 7%of total CO2 emissions from all industries in Japan,
according to the Ministry of Land, Infrastructure, Transport
and Tourism, as well as the Japanese government’s goal toreduce emissions under its Green Growth Strategy.
Life cycle assessments
UD Trucks has been contributing to the formulation ofguidelines on life cycle assessment (LCA) methods (including
calculation methods) in Japan’s auto industry as a memberof a subcommittee set up by the Japan Automobile
Manufacturers Association in 2021. The Company also set
up its own LCA working group comprised of members fromrelevant divisions. Tasked with raising and solving issues,
this group has been meeting periodically to review
progress, share information, and specify responsibilities
while collecting and analyzing data.
Measures for reducing CO2 emissions at
each stage of the product life cycle• Development and design
Recognizing that the majority of CO2 emissions occur
during the usage stage of its trucks, UD Trucks has been
focusing on leading-edge technological development
aimed at reducing the emissions at this stage of the
product life cycle.

Developing technologies for improving
fuel efficiency
The fuel that trucks burn is not only a major expense forcommercial vehicle operators but also a source of CO2
emissions, which is a major contributing factor to climatechange. For that reason, UD Trucks has been improving
the fuel efficiency of its trucks for decades, and regards
these efforts as one of its most important environmental
initiatives. In Japan, trucks and buses will need to improvetheir fuel efficiency by an average of 13.4% by 2025
under new fuel efficiency standards enacted in 2019
(compared with the standards introduced in 2015). In July
2022, UD Trucks introduced an 11-liter engine-powered
Quon heavy-duty truck model that already meets these
new standards, demonstrating its commitment to better
fuel efficiency going forward.
Related Improving the environmental performance ofQuon heavy-duty trucks (see page 11)

The Quon’s engine contributes to better fuel efficiency

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

Major technologies applied in heavy-duty trucks

Vehicle• Fuel Coach system for advising drivers on fuel-efficientdriving• Foretrack function for predicting the road ahead basedon scanned data
• Aerodynamic designs including front bumper-fitted air
dams and newly developed wind deflectors

Engine• Newly designed combustion chambers• Multi-stage fuel injection system• Electronically controlled variable-speed oil pump
• Designed to use less engine oil

Power
train

• Direct-shift transmission for low cargo-bed trucks• ECO+ mode cruise control

Developing next-generation technologies
UD Trucks develops its products in accordance with its
roadmap for innovation, “Fujin & Raijin. Vision 2030.,”
launched in 2018. One of the goals of this roadmap is tomass produce electric trucks by 2030. Therefore, theCompany has been conducting research on hybrid electric,
battery electric, and fuel cell electric vehicles. In addition
to vehicle electrification, UD Trucks is also studying
internal combustion engines powered by low-carbon
fuels. In these ways, it is exploring diverse solutions for
decarbonization in preparation for anticipated market
trends and changes in environmental regulations in the
countries where it sells vehicles.

• Logistics
Since leaving the Volvo Group in 2021, UD Trucks has beenbuilding its own logistics network with a focus on reducing
CO2 emissions from the shipment of parts and materials
from suppliers to its production plants in Japan, Thailand,
and South Africa, and from the transport of its new vehicles
and parts to dealers. Toward this end, the Company has
been working to shorten distances from suppliers’ facilities,
improve the efficiency of shipping methods, and optimize
shipments according to cargo volume.
• Sales and aftermarket services
UD Trucks organizes eco-driving seminars for truck drivers
in every region of Japan on a regular basis. The seminars
help drivers acquire practical skills and awareness of how
to maximize fuel efficiency when on the road.
Related Eco-driving and safe-driving seminars (see page 15)

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

19

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

20

Better for Business

Sustainability Activities

Waste reduction

Compliance with the Automobile
Recycling Law

of waste disposed in an effort to strictly comply with
relevant laws and regulations.
Total waste reused and disposed in 2021

Reducing waste at the production anddisposal stages
The final disposal of a truck at a dealer’s site accounts forthe largest amount of waste matter during the product life
cycle. For that reason, UD Trucks has established its own
waste-management system and created waste sorting
management standards for all of its dealers in 2014. In
accordance with the standards, each dealer has installed
disposal facilities and properly sorts waste materials duringtruck disassembly and disposal. In addition, the Company
delivers service parts in returnable packages to dealers tofacilitate the reuse of materials, and designs the packaging
materials as simply as possible to help reduce waste.
UD Trucks looks for ways to make disassembly work easierand use resources more efficiently starting from the productdevelopment stage. For example, bumpers are designed tobe simply disassembled into three components, headlights
can also be easily dissembled into interchangeable lens andLED units, and fenders are made from recyclable materials.
At the production stage, UD Trucks works to reduce andrecycle waste matter with the goal of minimizing theamount of waste it disposes in landfills. As a result of these
efforts, it has kept the proportion of landfill waste to total
waste generated at this stage under 1% for several years.
Aiming to improve its waste management system, UD
Trucks partnered with a company that specializes in waste
disposal in April 2015. Through this partnership, UD Trucks
has been using only highly reputable disposal firms,
administering and submitting all necessary reports togovernment agencies, and keeping records on the amount

Ageo Plant
Gunma Parts
Distribution
Center

Reused iron andnon-ferrous materials

Total waste
generated

UD Trucks collects automobile shredder residue, air bags,
and fluorocarbon from end-of-life vehicles for recycling, in
accordance with Japan’s Automobile Recycling Law, which
went into effect in 2005.

Waste reused
and recycled

6,316 tonnes 6,308 tonnes

Recycled asfuel chips(99.9% of total)

Reused as raw
materials for cement

Waste
disposed in landfills
7.99 tonnes (0.1% of total)
Recycled as refuse
paper & plastic fuelAmount of total waste disposed and percent reused or recycled
Percent of total waste
reused or recycled

Waste disposed in landfills
Target*(Tonnes of waste)(Percent)

20,000

100

89.4

2,000
1,000

99.7

99.7

99.8

99.9

99.9
80

68.5

60

100

40

50

20

19,268 2,273
0
1990

1995

16

14

10

7

8

2017

2018

2019

2020

2021

0

* UD Trucks began setting ambitious targets from 2004 following initiatives
for recycling and reducing waste implemented by the Japan Automobile
Manufacturers Association.

Scope of operations
Amounts shown in the graph are combined results from the Ageo Plant
and Gunma Parts Distribution Center from 2018 to 2021, and include
results from other facilities up to 2017.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Sustainability Activities

Better for the Planet

21

About UD Trucks Corporation

Better for People

Better for Business

Sustainability Activities

Pollutants discharged by the Ageo Plant over a 12-month period1

Conserving water andpreventing pollution

Regulatory
limit2Highest amountmeasuredm3/Day—Reducing water consumption and strictly
managing water and air pollutantspH—

5.8–8.6

Biochemical oxygen demand

mg/L

UD Trucks carries out routine measures to reduce the amountof water used in its operations. For example, it periodicallyinspects and cleans water-consuming equipment, checks
for leaks, and promptly repairs equipment if leaks are
discovered. It also sets company-wide goals for groundwater
conservation in compliance with ISO 14001 standards, andmonitors progress towards achieving those goals.
At the same time, the Company implements strictmeasures to prevent pollution of the air and nearby bodies
of water. Specifically, it restricts the discharge of pollutants
at levels lower than regulatory requirements, and regularly
cleans and maintains relevant equipment.

Chemical oxygen demand

mg/L

Suspended solids

mg/L

n-hexane

mg/L

Phosphorous
Nitrogen

Averageamount

8,026

0

893

7.9

6.9

7.4

25 (20)

4.6

1.4

2.3

160 (120)

7.5

2.6

4.4

60 (50)

<5

<5

<5

5

<2.5

<2.5

<2.5

mg/L

16 (8)

0.6

<0.1

0.2

mg/L

120 (60)

2.9

<1

1.6

Zinc

mg/L

2

0.2

<0.1

0.1

Fluorine and compounds

mg/L

8

<0.8

<0.8

<0.8

Measurement
unit

Regulatory
limit

Highest amountmeasured

Lowest amountmeasured

AverageamountNitrogen oxide

ppm

230

16

7

11

Particulate matter

g/m3N

0.2

0.002

<0.0010.001

Lowest amountmeasured

AverageamountTotal wastewater

Water
pollutants

Emitting equipment
Air
pollutants

Measurement
unit

Lowest amountmeasured

Items measured

Drying furnace

Items measured

Water consumption
Total water consumed

Water consumed per vehicle produced(Thousand cubic meters of water)

2,500

100

2,000

80

1,500

Pollutants discharged by the Gunma Parts Distribution Center over a 12-month period1(Cubic meters of water)

2,070

60
40

500

20

317

0
1990

1995

2017

340
2018

310
2019

321
2020

304
2021

Scope of operations: Amounts shown in the graph are combined resultsfrom the Ageo Plant and Gunma Parts Distribution Center from 2018 to
2021, and include results from other facilities up to 20170Highest amountmeasuredm3/Day

—

15.8

0

4.0

pH

—

5.8–8.6

7.2

6.3

6.7

Biochemical oxygen demand

mg/L

80

7.1

1.3

3.4

Suspended solids

mg/L

20

4.0

1.0

2.3

n-hexane

mg/L

1

<0.5

<0.5

<0.5

Measurement
unit

Regulatory
limit

Highest amountmeasured

Lowest amountmeasured

AverageamountTotal wastewater

Water
pollutants

1,643
1,000

Regulatory
limit

Items measuredAirpollutants

Measurement
unit

Emitting equipment

Items measured

Three heavy
oil boilers

Nitrogen oxide

ppm

180

66

57

60

Particulate matter

g/m3N

0.2

<0.001<0.002<0.001

Notes: 1. The pollutants were measured between April 2021 and March 2022. 2. Figures in parentheses are daily average limits.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Sustainability Activities

Better for the Planet

22

About UD Trucks Corporation

Better for People

Better for Business

Sustainability Activities

Regulated chemical substances handled at the Ageo Plant in 2021

Chemical substance management
Managing chemicals contained in products
UD Trucks strictly manages the chemical substances usedin its products, specifically those included in the Global
Automotive Declarable Substance List, in accordance withindustry standards and laws concerning the production,
import, management, and recycling of chemical substances.
The Company manages such substances both before andduring manufacturing.
At the product development and design stage, UD
Trucks determines what chemical substances will be usedat the manufacturing stage, including chemicals used bysuppliers. It then registers relevant data with theInternational Material Data System, a database jointly
managed by automobile manufacturers worldwide.
At the production stage, UD Trucks reports to thegovernment each year on its usage of chemicals subject toJapan’s Pollutant Release and Transfer Register, which is asystem for restricting and controlling the discharge ofdesignated chemicals into the environment. The Company
also makes efforts to replace hazardous chemicals with lessharmful alternatives, and properly comply with revisions torelevant laws or regulations.

(Substances included in Japan’s Pollutant Release and Transfer Register)
Regulation
numberChemical substance

Kilograms per year

Transferred

Discharged

Total
volumehandledto atmosphere

to water

to soilas wastematter

Disposedor treated

Recycled

Included infinishedproducts

53

Ethylbenzene

16,306

6,619

0

0

0

2,071

7,568

0

80

Xylene29,540

9,378

0

0

0

2,237

17,6590296

1,2,4-Trimethylbenzene

2,515

1,474

0

0

0

706

0

0

297

1,3,5-Trimethylbenzene

3,909

542

0

0

0

84

3,223

0

300

Toluene

6,661

4,930

0

0

0

1,209

102

0

PCB contaminated items stored at the Ageo Plant in 2021

Weight (kilograms)

Items with high concentrations

1

Items with low concentrations

2

Total

19,330019,330Transformers

0

140

140

Crossing gates

0

120

120

Insulating oil

0

27

27

Wiping cloths and other contaminated materials

0

213

213

19,330500

19,830Ballasts

Total
Notes: 1. Must be disposed of by March 31, 2023, under law.
2. Must be disposed of by March 31, 2027, under law.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Sustainability Activities

Better for the Planet

Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Environmental
management system

Environmental management organization
Executive Board
Sustainability Committee

Environmental policy
At UD Trucks, environmental activities are an
important part of our efforts to provide logistics
solutions that help communities flourish, and to fulfill
our Better Life purpose. Our environmental activities
are based on the following principles.
• We shall work to contribute to sustainability and thesuccess of our customers by continually reducing
environmental impacts across the entire productlife cycle.
• Each of us shall responsibly consider the environment
wherever we conduct our business, and build trustwith stakeholders based on our values.
• All of us shall work together to raise awareness ofenvironmental impacts and regulations, help build a
circular economy, and enhance the Company’senvironmental track record.

Environmental Group
Administrative Office

Responsible for achievingcarbon neutrality

Responsible for resource
recycling and risk management

Responsible for employee
engagement and education

Facility
Subcommittee

Product
Subcommittee

Recycling
Subcommittee

Environmental
Risks
Subcommittee

Workplace Subcommittee

Oversees initiatives
at factories,
workplaces, andlogistics facilities

Oversees productdevelopment
and life cycle
assessments

Oversees measures
to reduce, reuse,
and recycle

Overseesmanagement ofchemical substances
and air andwater pollutants

Promotes regulatory compliance andawareness of internal rules; oversees
employee engagement systems andinformation disclosure

23Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Sustainability Activities

Better for the Planet

About UD Trucks Corporation

Better for People

24

Better for Business

Sustainability Activities

ISO 14001 certification acquired group-wide
UD Trucks complies with the ISO 14001 international
standard for environmental management systems. The
Ageo Plant first acquired ISO 14001 certification in 1998,
followed by the Company’s Product Development Division in
2002, and other divisions thereafter. All certified workplaces
then completed the transition to the revised ISO 14001:2015
standard by 2018. Outside Japan, the certification has beenacquired by the Bangkok Plant in Thailand and the Pretoria
Plant in South Africa. Leveraging the benefits of thisgroup-wide environmental management system, UD Trucks
is currently working to achieve the objectives and targets of
its environmental action plan.

Auditing of environmental
management system
As a rule, UD Trucks conducts an internal audit of its
environmental management system every year to ensurethat it functions effectively. During the audits, a team ofqualified audit committee members verify and evaluate

whether the system is being properly implemented andcomplies with company rules as well as relevant
environmental laws and regulations. Likewise, theenvironmental management system is audited every year
by a third party in order to maintain ISO certification.

Material flow

Input
1. Development
and design

We use:Energy2. Procurementof materials
and auto parts•technologies that
reduce emissions•systems for
improving mileage•fewer materials that
impact the environment•technologies toreduce vehicle noise•recyclable materials
and components

We ensuresustainableprocurement anddeliver parts to
suppliers via
energy-efficienttransport

OutputCO2
PM
NOx

Raw materials
and truck parts

Resources andenergyResources andenergyEnergyWater, electricity,oil, etc.

Replacement
tires, fuel, etc.

Electricity andfuel for facilities
and equipment

4. Product usage

5. Product disposal

3. Production
Includes pressing, heat treating,machining, painting, assembly,
and inspections

We reduce the use of resources andhazardous substances, andoperate factories efficiently toconserve energy

CO2
NOx
SOx
Dust
Odor

Effluent

Waste
matterNoiseandvibration

We provide
eco-driving seminars

We sort materials
and parts for reuse
and recycling, andproperly treat anddispose waste

CO2
PM
NOx
Waste matter

Waste matter
Automotive
shredded residue
Airbags
Chlorofluorocarbons(incl. disposed tires)

Noise and vibration

The main environmental impacts of trucks over the entire product life-cycle are due to emissions of CO2 andexhaust gases containing particulate matter (PM) and nitrogen oxide (NOx) at the product usage stage.

and recycling

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Sustainability Activities

Better for People
UD Trucks strives to help employees
improve their well-being while fostering
a workplace culture that values inclusion,
personal development, and a healthy
work-life balance. All employees areencouraged to make the most of theirabilities and given the opportunity togrow professionally.
UD Trucks also works closely withstakeholders in a wide range of community
outreach initiatives, with a focus on roadtraffic safety seminars for local schools
and disaster relief.

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

25

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

26

Better for Business

Sustainability Activities

Fostering a workplace in which
inclusion is valued and individuals
can make the most of their abilities
Promoting diversity and inclusionin the workplace
For UD Trucks, the diversity of its employees is what makes
the Company unique and will be crucial for its growthjourney going forward. It aims to cultivate a culture inwhich each employee can play a part in making changes
that ultimately improve the workplace. Toward this end,
the Company maintains a fair and inclusive work
environment by raising awareness among employees
about all forms of discrimination, including those based onage, ethnicity, gender, sexual orientation, and religion.
To promote diversity and inclusion, the Company has
been holding D&I Week every year since 2014, whichfeatures many events aimed at raising awareness. In 2021,
events were held remotely due to the COVID-19 pandemic.
Among them, female executives and employees held virtual
panel discussions, and live sessions from various countries
were streamed online to all employees worldwide.

Fostering an inclusive workplace regardless ofgender identity and sexual orientation
To promote gender equality and the empowerment of
women, a network has been created inside the Company
to support female employees by organizing events,
dialogues, and lectures. In 2022, an online panel
discussion on LGBTQ+ issues was held during D&I Week,
with 522 employees attending globally. The Company’s
internal rules and regulations have also been updated withgender-neutral language to make them more inclusive.

Promoting employment of people with disabilities
To provide an inclusive and fair working environment forpeople with physical and intellectual disabilities, UD Trucks
holds related training sessions and seminars aimed atdeepening the understanding of all employees. For example,
webinars about hiring people with disabilities, including one
entitled, “Creating a work environment that is inclusive ofpeople with disabilities,” were held in 2020 and 2021, witha total of 690 employees participating. In May 2022, a sign
language class taught by employees with hearing
impairments was held at the Company’s headquarters.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

27

Better for Business

Sustainability Activities

Promoting job-based employment
In 2015, UD Trucks abolished the seniority system
traditionally practiced in Japan and adopted a job-based
employment system with the aim of promoting diverse
work practices. At the same time, the Company began
recruiting new graduates according to specific job
positions. In these ways, management has been moreaccurately matching the abilities and career plans of
employees with their actual work.
The Company has also been using its internal job posting
system, which it introduced in 2011, to provide fair
employment opportunities to all employees. This transparent
system allows individuals to pursue their career aspirations
regardless of their region, workplace, or personal attributes.

Employee data (as of April 1, 2022)
In Japan• Number of
employees

Overseas

6,146
5,675

• Number of
employees

males

471

• Number of

983

males

60

• Numbers of

New graduates

Mid-career

managers

hires in 2021

• Number ofnationalities

208

1,474

femalesfemales

195

31

Australia, Bangladesh, Brazil, Canada, China, England,
France, Germany, India, Indonesia, Ireland, Italy, Japan,
Malaysia, Mongolia, Morocco, Myanmar, Nepal, Pakistan,
Russia, Senegal, Singapore, South Korea, Sri Lanka,
Sweden, Thailand, the Philippines, Ukraine, United States,
Uzbekistan, and Vietnam

1,976• Number ofnationalities

males

502

females

41

Australia, Bangladesh, Belgium, Bosnia, Brazil, Canada, China,
Columbia, Egypt, England, France, Germany, India, Indonesia,
Iran, Ireland, Italy, Japan, Malaysia, Mongolia, Morocco,
Myanmar, Nepal, Netherlands, Pakistan, Peru, Portugal,
Russia, Senegal, Singapore, South Africa, South Korea, Sri
Lanka, Sweden, Thailand, the Philippines, Ukraine, United
Arab Emirates, United States, Uzbekistan, and Vietnam

Fostering results, growth, and trust
through dialogue
At UD Trucks, leaders and team members regularly engage indialogue about a wide range of matters, such as setting work
priorities, confirming progress, proposing improvements, anddeveloping skills. Through such discussions and feedback,workplaces not only achieve results but also foster personal
growth and build trusting relationships.
The Company has also been taking steps to facilitate
internal communication. During the COVID-19 pandemic,interactive meetings were regularly held online, and a new
digital platform was launched to allow all employees tobrowse, send, and share necessary information anywhere
and anytime. Operational systems have also been madeaccessible by smartphones and tablets.

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

28

Better for Business

Sustainability Activities

Helping employees continuously
learn and growDeploying its ample training facilities and training
management system, UD Trucks provides a wide range oftraining programs to facilitate active learning andself-development among employees, with an emphasis onfour key areas: leadership, business acumen, newtechnology, and entrepreneurship. This enables employees
to develop and refine their expertise and capabilities
while acquiring the skills they need not only for theircurrent jobs but also for the future.

Leadership development programs
UD Trucks offers a variety of programs for developing
leaders, including programs tailored to levels of ability andyears of service, as well as programs designed for specificleadership roles. Recently, employees from Japan, China,
India, Thailand, Singapore, the United Arab Emirates, andSouth Africa have been participating in self-discovery
leadership program based on the Company’s global
self-directed learning method.

Occupational health and safety
Measures to prevent the spread of
COVID-19
UD Trucks places the highest priority on ensuring the healthand safety of its employees. Since the first outbreak of
COVID-19 in 2020, the Company has initiated various
measures to help employees stay safe and prevent
infections. Among them, it has frequently monitored thehealth of employees, mandated mask wearing and use ofhand disinfectant, and prohibited close-contact situations
and crowded gatherings in poorly ventilated spaces. To help
enforce these rules, the Company has issued guidelines on
workplace behavior and COVID-19 countermeasures. Basedon the guidelines, body temperature is checked whenemployees enter buildings, masks are mandatory in offices
and cafeterias, seats are adequately spaced, transparent
partitions have been set up between desks, door handles
are regularly disinfected, and limits are set on the number ofpeople using meeting rooms. The Company has encouraged
employees to take advantage of the telecommuting
system it had in place so they can work safely from home.
Beginning in July 2021, UD Trucks has been offering
vaccines onsite to employees working at headquarters andworkplaces in the greater Tokyo area. It has also been
providing support for employee vaccinations in othercountries where it operates, including South Africa,
Thailand, India, and China.

Helping employees manage stress
UD Trucks routinely provides stress assessments in theworkplace to help employees manage stress. Employees areencouraged to meet with physicians or counselors if theirresults indicate high stress levels, and their job responsibilities
may be reduced based on the advice of the physicians.

Maintaining flexible workplaces
UD Trucks has put in place various systems and policies
designed to help employees maintain a healthy balance
between their working and personal lives. They include aflex-time system along with childcare and nursing leavesystems. More recently, the Company initiated a
telecommuting system that places no limits on the numberof days employees can work at home. It has also establishedan anti-harassment policy and related e-learning program.
Furthermore, UD Trucks is making ongoing efforts to reduceand eventually eliminate overtime work.
Number of employees taking maternity, childcare,and nursing care leave in 2021
Number of
employees
Maternity
leave

Actions after taking leave

Women

22

22 took childcare leave
after maternity leaveMen

7

2 retired

Women

22

3 retiredChildcareleave

Nursing care
leave

0

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

29

Better for Business

Sustainability Activities

into a disaster relief vehicle that can provide evacuees withprivate spaces, which are difficult to secure in community
evacuation centers during times of disaster. Indeed, evacuees
are said to experience additional mental and physical strain
due to a lack of privacy. The truck’s cargo space contains two
private rooms: an infant care room where mothers canchange diapers and breastfeed, and a room for caring forthe elderly and people with physical disabilities. The rooms
are equipped with an air conditioner, refrigerator, and sink,with electricity provided by a solar panel, diesel generator,and high-capacity battery. The electricity can also be used tocharge mobile phones and batteries, which are essential for
emergency communications.
In addition, the Company provides a flat-bed truck fortransporting disaster preparation supplies, such as sandbags.

Engaging with communities
Road safety instruction for elementary
school students
In Saitama, where UD Trucks is based, traffic accident
prevention is regarded as a major issue, especially since theprefecture has one of the highest numbers of fatal roadaccidents involving medium- and heavy-duty trucks inJapan. Therefore, improving vehicle safety and raisingawareness of traffic safety among pedestrians are essential
measures for reducing road accidents.
Recognizing its responsibility as a truck manufacturer
to help prevent traffic accidents, UD Trucks has been
conducting a traffic safety program for elementary school
children in the city of Ageo, Saitama, since 2016. The
Company makes the most of its expertise, facilities, andemployees, who help run the program, and develops its
own curriculum with assistance from the city’s education
board regarding teaching methods, materials, andtargeted school grades. The program is unique for having
the school children participate in activities that use actual
heavy-duty trucks to demonstrate their blind spots and thespace required when turning corners (specifically thedifferent arcs taken by the front and rear wheels). The
children are also given an opportunity to sit in the driver’s
seat of a truck to observe what drivers can actually see
outside. Teachers leading the activities have commented
that the children have become more aware of safety byseeing the trucks firsthand, and sitting in the driver’s seat
was a valuable experience for them.

Introducing disaster relief trucks
Natural disasters such as floods, landslides, and droughts
are expected to become more severe and frequent due toclimate change caused by global warming. In Ageo, Saitama,
where UD Trucks is based, employees witnessed a flood
first-hand in 2019 when a major typhoon caused thenearby Arakawa River to overflow, resulting in serious
damage and the evacuation of around 1,000 residents.
The Company then began considering how it could use its
property, products, and human resources for disaster relief
measures and reconstruction.
This led the Company to modify a Kazet light-duty truck

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

30

Better for Business

Sustainability Activities

Sponsoring the Ageo City Half-Marathon

Helping promote community-based sports

Educating the next generation of leaders

UD Trucks has been supporting the Ageo City Half
Marathon as a local sponsor since 2013. Held every
autumn, the marathon has long been a popular local eventin the city, with over 7,000 runners participating each year.
After being suspended for two years due to COVID-19, therace was held again in November 2022. UD Trucks offeredoriginal tumblers and cookies to children participating in
the race, and distributed items to runners from its booth. It
also provided three buses for runners to rest in after
finishing their leg of the race. More than 70 employees ran
in the 2022 marathon.

In 2022, UD Trucks acquired the naming rights for the
Ageo Municipal Baseball Stadium, helping fund the city’splan to promote sports as a means to activate communities
and improve quality of life for local residents. Recognizingthat this plan aligns with its commitment to making life
better for people in line with its Better Life purpose, theCompany sought to acquire the naming rights.
Besides being used for local events, the stadium hosts
the prefectural qualifiers for the annual National HighSchool Baseball Championship and professional minor
league baseball games, which many city residents attend.
As the naming rights holder, the Company will work withthe city government to explore new ways of using thefacility to bring more dynamism to the community.

UD Trucks has an academic partnership program with
Sophia University in Tokyo. The program aims to provide
opportunities for students to learn about the logistics industry
and multinational corporations by observing how UD Trucks
operates, and to assist them with their future career options.
Students are also expected to broaden their outlook while
appreciating the importance of logistics for society.
In the fall semester every year, employees of various
nationalities from the Company give lectures in 14 classes,
each focusing on a different topic such as productdevelopment, logistics, procurement, manufacturing, sales,
legal affairs, and corporate finance. Classroom lectures
resumed in 2022 after mainly being held online in 2020
and 2021 due to COVID-19. Along with these lectures, theprogram offers a summer internship and scholarships asmeans to support the students.
UD Trucks and Sophia University have been renewing
their partnership program agreement every three years
since the program started in 2014, attesting to theuniversity’s high evaluation of the program.

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for Business
Aiming to attain the highest level of
performance in the truck manufacturingindustry, UD Trucks prioritizes sustainablegrowth by enhancing organizational
efficiency and productivity, transforming
its businesses through digitalization, andstrengthening corporate governance.
The Company proactively invests profits
back into its businesses to lay a path for
future growth for the benefit of its
stakeholders and to support the logistics
industry as a whole.

31

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

32

Better for Business

Sustainability Activities

Transforming businesses
through digitalization
Promoting a digital transformation acrossall business activities
For UD Trucks, a digital transformation involves not justIT-related innovation, but also positive changes to its corporate
culture as part of a broader business transformation. As
such, a data-driven digital transformation is indispensable
for advancements in logistics, higher operational efficiency
and productivity, and improvements in workplace
conditions. The Company has been investing in IT tools
and making use of big data applications, thereby enablingits management to centralize, analyze, and facilitate theapplication of a wide range of data, from production
planning and quality control to sales and services. This data
has also been made available to employees as a means togenerate new business ideas and stimulate dialogue
between employees irrespective of rank or position.
In addition, UD Trucks has applied digital tools to set
up a telecommuting system for its employees. This hasbolstered the Company’s ability to attract highly skilledworkers from around the world, which is contributing to
the diversity and capabilities of its workforce.

Using data to link the engineering andsupply chains
UD Trucks is building a new system for accelerating data
linkages between its engineering and supply chains. By
pursuing product-related data applications and information
sharing, the Company is aiming to enhance its engineering
capabilities, which are crucial for manufacturing, while
making its supply chain more resilient against various kindsof risks.
The engineering chain is said to account for about 80%
of product costs and is a vital factor for product quality.
Therefore, to raise efficiency and productivity at the productdevelopment and design stages, the Company created adigital model that integrates the Product Development
Division’s 3D CAD data and the Manufacturing Division’s
parts-related data. With the linking of this data, it is possibleat the product development and design stages to detect
potential problems early on, improve quality, and eliminate
the need to redo processes at later stages of production.

The Manufacturing Division and Sales Division have alsoestablished a platform for centralizing data about
production schedules, quality assurance, and the status ofsales negotiations, enabling personnel from each division
to access and share relevant product-related information.
To effectively respond to unexpected changes in theGroup’s operating environment, which is becoming
increasingly difficult to predict, UD Trucks plans to createa system for its organizations and subsidiaries to shareimportant data. Accordingly, the Group will broaden its
use of data with the adoption of Internet of Things (IoT)
platforms at factories and the application of augmented
reality (AR) solutions in product development, manufacturing,sales, and aftermarket services. In cooperation with its
suppliers and customers, UD Trucks will continue using data
to seamlessly link and facilitate communication between
the engineering and supply chains, with the goals of
establishing a resilient supply chain and a customer-oriented
business model that creates new value.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities

Digitalizing aftermarket services

Digitalizing HR systems

As part of its efforts to raise the efficiency and productivityof aftermarket services, UD Trucks has integrated its
customer relationship management (CRM) and enterprise
resource planning (ERP) into a new system called UD
Dynamics. The system was introduced at its customer
centers throughout Japan from April 2022. UD Dynamics isdesigned to transform and digitalize aftermarket service
workflows. At the same time, the Company intends tohelp customers increase productivity and uptime by using
the system to reduce their waiting times, provide services
more efficiently, expand maintenance service capacity,
access relevant data in real time, and optimize servicing ofvehicles that have broken down on the road. Looking
ahead, UD Trucks plans to use UD Dynamics as the basis for
a comprehensive platform spanning all of its aftermarket
services, enabling the operational status of service centers
and the vehicles they are servicing to be checked in realtime. By responding to customers with such data-driven
solutions, the Company aims to enhance the quality of its
services and raise the level of customer satisfaction.

UD Trucks is promoting desk sharing and e-correspondence
in its workplaces to facilitate open communication and afree exchange of ideas among its employees. Furthermore,with the shift to telecommuting during the COVID-19
pandemic, the Company has been discontinuing outmoded
work practices and the use of paper documents by applying
digital solutions. For example, it transferred various
administrative procedures and payroll calculations to a
cloud-based personnel management information platform
in June 2022. By digitalizing human resources systems inthese ways, the Company aims to foster more diverse andflexible workplaces and attract strategic human resources
going forward.

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

33

Sustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Sustainability Activities

Better for the Planet

Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Strengthening corporate
governanceUD Trucks’ management teamKouji Maruyama
Naoto Hakamata
ChairmanPresident
Senior Vice President ofJapan Sales

Tetsuya Aiba

Koichi Ito
Senior Vice President,
Strategy and Product LineManagement, Brand andCommunication

Taro Kunifusa

Yoshinao Arai

Director

Auditor

Chief Financial Officer andSenior Vice President,
Human Resources,
Legal and Compliance

Takeya Okajima

Douglas Nakano

Shuichi Hayashi

Toshihisa Nakaya

Senior Vice President,
Operations Modernization

Senior Vice President,
Technology

Senior Vice President,
Purchasing

Senior Vice President,
Logistics

Hiroshi Sasaoka

Jacques Michel

Keiki Ka

Senior Vice President,
Operations

Senior Vice President,International Sales

Head of Digital Solutions
and IT

Luis Plocharski
Head of Quality Assurance34

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

35

Better for Business

Sustainability Activities

Framework for promoting sustainability
In December 2021, UD Trucks established its Sustainability
Committee to promote sustainability-related activities
throughout the Company. Positioned under the Company’s
Executive Board, the Sustainability Committee adopts anenvironmental, social, and governance (ESG) framework for
its activities (refer to page 4). Accordingly, its membership is
made up of members from three groups: the Environmental

Group, Social Group, and Governance Group. These members
engage in inter-committee discussions, formulate proposals,
and submit quarterly reports to the Executive Board, whichthen integrates the proposals into management activities.
Within each of the three groups, teams have been set up
to examine and address specific priorities. They determine
current circumstances, set goals, devise action plans, andmonitor the progress of related activities.

UD Trucks Code of Conduct
The Company created the UD
Trucks Code of Conduct topromote ethical businesspractices and compliance withlaws and regulations. The code
explains basic principles andstandards for behavior for all
employees to follow.

Executive Board
UD Trucks Code of Conduct
handbook

Sustainability Committee
Administrative OfficeGroup
E Environmental
responsible forAchieving carbon neutrality

S

Social Group
responsible forProtecting human rights
Promoting diversity and inclusion

Resource recycling andrisk management

Overseeing safety and security
Skills training

Employee engagement
and education

Preventing harassment

Topics covered in the UD Trucks Code of ConductGroup
G Governanceresponsible forStrengthening corporate governanceOverseeing risk management
Enforcing the Code of Conduct
Overseeing the whistle blower system
Ensuring cyber security
Overseeing personal information security
Enforcing the Supplier Code of Conduct

Human rights
Respect for others; prohibition of discrimination; safe andhygienic workplaces; compliance with environmental
regulations; freedom of association; working hours andremuneration; prevention of modern slavery and child labor
Fair and lawful business practices
Compliance with product-related regulations; faircompetition; prohibition of inappropriate business courtesies(including gifts and entertainment); compliance with importand export controls; prevention of money laundering
Separation of business activities andpersonal interests
Conflicts of interest; political activities; insider trading
Protection of company data and assets
Confidential information; intellectual property; tangible
and financial assets; personal information security
Transparency and assignment of responsibilities
Financial accounting and reportingSustainability Report 2022

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

36

Better for Business

Sustainability Activities

Measures for ensuring compliance
For UD Trucks, compliance is an important component of
its corporate culture and values. Recognizing that business
transactions must be conducted ethically, responsibly, andin good faith, the Company provides compliance-related
training programs to all employees.
In 2020, UD Trucks launched a compliance programfor its sales departments in Japan with the goal of
ensuring fair and lawful transactions. It has also been
carrying out various educational campaigns to better
enable employees to act properly based on a solid
understanding of business ethics.
After joining the Isuzu Group in April 2021, UD Trucks
revised its compliance-related policies and guidelines basedon Isuzu Motors’ compliance system, and, accordingly,
strengthened its management of importantcompliance-related risks, including those associated withcompetition laws, corruption, import and export controls,
and personal information security. UD Trucks has also set
up an internal whistleblower system for facilitating prompt
and proper responses to any cases of wrongdoing or
suspicious actions, and is developing an online reporting
system to improve usability for users.
In addition, UD Trucks established its Compliance
Committee in October 2021, and conducted a survey of
employees to determine their awareness ofcompliance-related matters in January 2022.
Compliance with legal requirements concerning
subcontractors
To maintain sound relationships with its suppliers, UD
Trucks has established internal rules for ensuring fullcompliance with Japan’s legal requirements concerning
subcontractors, which include provisions regarding latepayments. It has also created a related training program,revised its procedures for paying suppliers, and isperiodically conducting business audits of relevant
departments. Furthermore, the Company has set up a
hotline inside its Legal Affairs Department to impartially
respond to enquiries and complaints from suppliers
regarding compliance-related matters.

Risk management
UD Trucks has been working to improve risk management
across the entire organization. The Company routinely
identifies and assesses risks at the managerial and operational
levels, and takes proactive steps to effectively manage suchrisks and prevent them from materializing. These procedures
are reported to executive management whenever necessary
to ensure that risk management systems are functioning
properly. These systems aim to ensure the safety of
employees and visitors at workplaces, safeguard confidential
information and intellectual property, respond to emergencies
such as a fire or natural disaster, and prepare for resuming
operations in the event of a disaster. Thanks to theseongoing efforts, UD Trucks has been maintaining safe andsecure operations for many years.

Information security
UD Trucks has taken measures for ensuring the security of
its information and data, and is maintaining an information
security governance system. To guard against an information
system breakdown caused by a disaster, the Company
stores and manages electronic information at an
earthquake-resistant data center in addition to its head
office. It has also stepped up measures for preventing data
breaches resulting from cyber-attacks, and regularly
provides training sessions on improving information
security to its dealers nationwide. In addition, UD Trucks
strictly manages and protects all personal information it
possesses in accordance with its privacy policies.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

37

Better for Business

Sustainability Activities

Ensuring responsible procurement
Strengthening partnerships with suppliers
UD Trucks recognizes that fulfilling its Better Life purpose
involves making life better for people and the planet
through its entire value chain. From this standpoint, it has
included sustainability as an important criterion in its
procurement process along with quality, performance,
delivery times, and costs, and is bolstering initiatives totackle sustainability-related issues across its supply chain.
As part of these efforts, the Company has included
standards for all of its suppliers to meet in the UD Trucks
Supplier Code of Conduct, as a means to share its approachto sustainability and expectations for conduct with its
suppliers, and to build stronger partnerships in the future.
Meanwhile, the Sustainability Committee, establishedin 2021, has been assessing the Company’s environmental
initiatives and business dealings, and identifying andaddressing important issues for the UD Trucks Group andits suppliers, such as ensuring that human rights areprotected in the supply chain.

Requirements placed on suppliers

Responsible sourcing of conflict minerals

Comply with the UD Trucks Supplier Code of Conduct
Meet the Company’s standards for sustainability regarding
human rights, environmental protection, etc.
Produce sustainable products
Assess sustainability using a version 4.0 self-assessment
questionnaire for suppliers in the automotive industry
Acquire sustainability-related certification fromrelevant organizations
Do not use prohibited substances and materials
Confirm any usage of items listed in international
databases of banned substances and materials
Determine CO2 emissions and take steps toreduce them

UD Trucks strives to ensure responsible and sustainablesourcing of conflict minerals, namely tin, tantalum,
tungsten, gold, and cobalt. The Company requires its
suppliers to comply with all relevant laws and regulations,and states this clearly in its Supplier Code of Conduct(specifically in the section on responsible sourcing of raw
materials). Furthermore, suppliers are required to follow
responsible mineral sourcing procedures in high-risk areas.

Sustainability Report 2022

UD Trucks at a GlanceContents

Message from the President

About UD Trucks Corporation

Our Purpose

Sustainability Activities

About UD Trucks Corporation

38

For more information about UD Trucks, please refer to the following websites:• Global website: https://www.udtrucks.com/• Facebook: https://www.facebook.com/UDTrucksJP• YouTube: https://www.youtube.com/user/udtrucksvideos

Since its founding in 1935, UD Trucks has been a key player in Japan’s transport and logistics industry as a commercial truck manufacturer.
The Company currently provides high-performance trucks and services in response to the needs of customers in roughly 60 countries worldwide.

Company overview (As of April 1, 2022)
Company name

UD Trucks Corporation

Date of foundation

December 1, 1935

Head office address

1-1, Ageo-shi, Saitama 362-8523,
Japan

Capital77.5 billion yen

Number of employees

6,146 employees (Japan)

Main businessJapanese business
Development, manufacture, export,
and sales of heavy-duty trucks; salesof medium- and light-duty trucks;
manufacture and sales of vehicle
components; maintenance and salesof service parts for trucks and buses;
import and sales of Volvo brandproducts.
Businesses outside of Japan
Development, manufacture, and salesof heavy-, medium-, and light-duty
trucks for growth markets;
manufacture and sales of vehicle
components; maintenance and salesof service parts for trucks and buses.

Operations in Japan

Headquarters and Ageo Plant; Motegi
test center; Gunma, Hokkaido, Sanyo,
and Kyushu parts distribution centers;
Volvo Penta OfficeSubsidiaries in Japan

New-Mech Co., Ltd.

Operations outsideof JapanUD Trucks Singapore Office; UD
Trucks Bangkok Plant, UD Trucks
India, South Africa parts center,
Middle East parts center (in Dubai)

Subsidiaries outsideJapan

UD Trucks North America, UD Trucks
Southern Africa

History
DecadeHistory of the company

Technical development and product launches

1930

1935 Originally established as Nihon Diesel Industries,
Ltd., in the city of Kawaguchi, Saitama Prefecture1938 First diesel engine
1939 First diesel truck

1940

1942 Renamed as Kanega-Fuchi Diesel Co., Ltd.
1946 Renamed as Minsei Sangyo Co., Ltd.

1950

1950 Renamed as Minsei Sangyo Co., Ltd.

1960

1960 Renamed as Nissan Diesel Motor Co., Ltd.
1962 Commenced operations of the Ageo Plant

1970

1955 Proprietary UD Engine, a powerful lightweight diesel engine
1958 6TW model truck, the first in Japan with a load capacity
exceeding 10 tons

1975 Condor medium-duty truck

1990

1990 Big Thumb heavy-duty truck

2000

2007 Joined the Volvo Group

2004 Quon flagship heavy-duty truck

2010

2010 Renamed as UD Trucks Corporation2013 Quester heavy-duty truck for emerging markets
2014 Kazet light-duty truck
2017 New Quon and Condor truck models
Croner medium-duty truck and Kuzer light-duty truck for
emerging markets

20202021 Joined the Isuzu Group*

Products and services provided by UD Trucks

UD Trucks

Volvo trucks

Volvo Penta

Sales of Quon heavy-duty trucks, Condor
medium-duty trucks, and Kazet light-duty trucks toJapan and other developed markets, and Quester
heavy-duty trucks, Croner medium-duty trucks,
and Kuzer light-duty trucks to emerging markets

Sales of imported Volvo brand heavy-duty
trucks to the Japanese market, including Volvo
FH 4x2 and 6x4 tractors, 6x2 and 6x4 Rigid
trucks, and FMX 6x4 and 8x4 Rigid trucks

Sales of Volvo Penta brand industrial andmarine engines for the Japanese market,
including forklift and pleasure craft engines,
and installation and technical support fororiginal equipment manufacturers* UD Trucks is a member of the group of companies led by Isuzu Motors Ltd. For more information about Isuzu Motors, please refer to the following website: https://www.isuzu.co.jp/world/company/profile.html