Act with integrity and contribute tosociety through technology andengineering.

NIPPON KOEI GROUPINTEGRATEDREPORT
2022 Fiscal year ended June 30, 2022

NIPPON KOEI CO.,LTD.
5-4 Kojimachi, Chiyoda-ku, Tokyo 102-8539, Japan
https://www.n-koei.co.jp/english/

This product is made ofmaterial from well-managed,
FSCR-certified forests and othercontrolled sources.

This booklet was printed
with an environmentally friendly
ink that contains no volatileorganic compound (VOC).

Management Philosophy

Strengths of Nippon Koei Group

Society

A sustainable business model thatevolves with progress in society

Act with integrity and contributeto society through technology
and engineering.

From its inception, Nippon Koei has been building infrastructure thathelps solve social issues. The Group evolves as the needs of societychange while continuing to expand our business and improve our
profitability.

Society’s needs areconstantly evolving

Nippon Koei
Commercialize solutions forsocial issues
Changes to meet new needs

The Nippon Koei Group has been building infrastructure for society in Japan and overseas since 1946.
Nippon Koei founder Yutaka Kubota proclaimed, “Tackle your problems with sincerity andIntegrated Capabilities

the road ahead shall be clear,” and dedicated his technical expertise and passion to building

Japan’s leading engineering
consulting firm

infrastructure that is safe and reliable.
All of our employees today remain dedicated to our fundamental conviction that our business is
to contribute to society.

The Nippon Koei Group is Japan’s leading civil engineering
consulting firm* and has participated in infrastructure development
projects improving safety and security for people around the world
for more than 70 years. The Group has developed projects that havebecome foundations for the advancement of nations and people inover 160 countries and regions.

The world is full of people who desire better living standards.
The Nippon Koei Group is committed to acting with integrity as we help construct the infrastructure forsocieties and nations around the world.

We deploy the integrated capabilities of experts
in various fields to meet the increasingly
sophisticated and complex needs of our age.

Human
Resources

Technology

We lead the industry withover 1,700 professional
engineers who provide
expert consulting incountries around the world.

We carry out advanced
basic and appliedresearch at our R&D
Center, the largest in theindustry in Japan.

*Source: “Sales ranking of engineering consulting firms in Japan,” Nikkei Construction, April 20, 2022

Editorial Policy

Introduction
History of the Nippon Koei Group
Business Areas of Nippon Koei Group

Strategy
3
5

Message from the President
Transition to a Holding Company Structure

7
12

Nippon Koei Group Value Creation
Process

13

Creating Value through Nippon Koei
Group Capital and its Utilization

15

Human Resources and Technologies
that Support Our Business Model

17

Integrated Capabilities of the
Nippon Koei Group
Long-Term Management Strategy
Medium-Term Management Plan
Financial Capital Strategy
At a glance

1 NIPPON KOEI GROUP INTEGRATED REPORT 2022

19
21
27
29
31

Sustainability/ESG

Status of the Company

33
34
Society37
Corporate Governance43
A Discussion with Outside Directors 51

Board of Directors, Executive Officers andAudit & Supervisory Board Members
63
Consolidated Financial Data
65

Sustainability Management
Environmental Management

Review of Operations
Nippon Koei Group Business
Segments
Consulting Business
Urban & Spatial Development
Business
Energy Business

55
57
59
61

Corporate Data
Organizational Structure
Network, Major Group Companies,
and History

67
68
69

The Nippon Koei Group Integrated Report is published as a comprehensive
communication tool for delivering corporate information to our stakeholders.
By publishing this report, we aim to provide readers with a deep understanding about
our corporate stance from the time of our founding to today and our efforts for further
increasing corporate value. The disclosure framework of the International Integrated
Reporting Council (IIRC) was used as a reference during the editing of this report.
Organizations Covered: Nippon Koei Co., Ltd. (the “Company”) and its consolidated
subsidiaries
Period Covered: Fiscal year ended June 30, 2022 (July 2021 to June 2022). However,some information from July 2022 onward has been included.

Forward-Looking Statements
This Integrated Report contains forward-looking statements regarding the future
performance of the Company and other matters. They are based on the judgment of theCompany’s management obtained from currently available information. Therefore, forwardlooking statements are subject to change due to a variety of factors and are not guarantees
of future performance.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 2

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

History of the Nippon Koei Group
Inheriting the “business mindset” and “integrity” that our founder, Yutaka Kubota, valued, we have taken on the challenge ofpioneering initiatives since our founding in 1946. Over the past 75 years, our efforts to find optimal solutions to ever-changing
social issues and needs and to commercialize them have led to our current strengths. We will continue to grow with an eye on
the future.

International Consulting

1970-1990 Development Phase

Net sales¥56.1 billion

Developed infrastructure that
contributed to industrial growth

1973
New Akita Airport

1949
Basic survey for the Yakushima comprehensive development Project

1976
Arakawa Dam

1954
Balu Chaung Hydroelectric Power in Burma

1966
Nam Ngum Dam in Laos

1978
Asahan No. 2 Hydroelectric Power in Indonesia

1955
Da Nhim Hydroelectric Power in South Vietnam

1969
Soyang River
Dam inSouth Korea

1982
Mahaweli Irrigation Project in Sri Lanka

1990-2010 Maturity Phase¥65.0 billion

Focused on renovating and maintaining
infrastructure to support comfortable lives
and to respond to environmental change

1986Japan: Akashi-Kaikyo Bridge Anchorage
Environmental assessment for the Tokyo
Metropolitan Government’s new office building

1985
East Meskene Irrigation in Syria
Tianshengqiao Second Hydroelectric Power in China
Choluteca Basin Agricultural Development in
Honduras

Revenue

Net salesFYE March 1990

1961
1946
Surveying for Kasumigaura and Hachirogata reclamation Landslide survey in the Yui districtFYE June 2022

1996
Nationwide road inspection fordisaster control
Tokyo International (Haneda)
Airport Runway B¥130.6 billion

2010-2020 Innovation Phase
Contributed to the creation of societiesthat are sustainable and resilient

2007
Tsuruta Dam redevelopment

2011
Response to the Great
East Japan Earthquake
Earthquake

2014
Yanba DamBusiness Fields● Water resources

2013
Construction
Management (CMR) for
Otsuchi Town, Iwate
Prefecture

and waterways

2021
Integration of our Domestic
Consulting and International
Consulting businesses

1995
Sindhuli Road, Nepal

2005
Gulf of Panama purification project

1998
Hai Van Tunnel, Vietnam

2006
Asahan No. 3 hydroelectric power in Indonesia

2013
Dhaka MRT Line 6 in Bangladesh
Lach Huyen Port Infrastructure in Vietnam
2014
Thilawa Area Infrastructure
Development in Myanmar● Agricultural and ruralplanning & design● Dams and power

generation● Urban and regional

development● Transportation● Environmental

management● Management● Disaster prevention

1947
Development of our first blocking coils (Line trap)

1960
Kawasaki Substation (150kV)

1972
Shin-Tochigi Substation (500kV)

1949
Installation of water turbine generator at Akazawa Power Station
Provision of simple automation equipment at Mukaze Power Station

1964
Transmission line (132kV) in Batang
Padang, Malaysia

1957
Water turbines at Nagashino Power Station

1968
Azumi Trunk Line and Fukushima
Trunk Line (500kV)

1976
Water turbine generator, Tenjin Power Station (exceeding 10MW)
Jintsu River basinDam monitoring and control system

1985
Transmission & Substation
Network (230kV) in Chile
S-type tubular water turbine,
Sekiyama Power Station

2003
5th generation (improved
distribution) system,
Yokohama-Naka Control
Center1983
Transition type for new control
system, Shimousa Substation

1991
Telecontrol system for large-capacity
substations, Shin-Fuji Substation

2008
230kV power line/substationin Bangladesh

2009
Shin-Keiyo Substation
service tunnel

2014
Komata River No. 4 Power Station and three otherpower stations

2011
Shin-Sogi Hydropower
Station2016
Obora No. 1 Power Station

Postwar reconstruction in Japan and abroad

Kubota used his expertise as an engineer to establish a business process that is the prototype for today's construction consulting firms:
preliminary surveys, evaluation, and proposals for infrastructure projects. He also created our business style, which involves approaching
projects with a broad perspective by gathering engineers with areas of specialty beyond electrical and civil engineering technology so a
project can contribute to resolving greater social issues. Today, engineering consulting firms are expected to fulfill the role that Yutaka Kubota
defined more than half a century ago.

3 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Market Trends
Launch of the Business Segment
As demand for urban development increased worldwide,
Nippon Koei entered the architecture and urban
development fields by acquiring BDP to strengthen its
Architecture Dept., which was small at the time.

equipment and devices● Construction of2018
Launch of the Energy Business
Investment in EU energy storage projects

2016
Acquired UK-based architectural design company
BDP Holdings Limited
Launched Urban & Spatial Development Business
2017
Palace of Westminster Restoration and Renewal
Project - BDP
2022
Launched Nippon
Koei Urban Space
Co., Ltd.

Urban & Spatial
Development Business

Origin as a “construction consultant”

Urban & Spatial
Development Business

From the 1930s until the end of WWII in 1945, Nippon Koei’s founder Yutaka Kubota participated in engineering power generation facilities
and dams on the Korean peninsula, which contributed to the economic development of the region. After the War ended, he decided toestablish the Company to carry out his strong determination to rebuild his homeland. He brought together the repatriated specialists in civilengineering, geology, electricity, and machinery and focused their talents on reestablishing the country’s national foundation and electric
power infrastructure. He also saw the need for reconstruction in other countries destroyed by war and the 1954 project to build a power
generation in Burma (now Myanmar) marked the first step in the globalization of the Nippon Koei Group.

Nippon Koei entered the energy business to capture
demand from the global increase in renewable energy and to
capture the demand associated with power system reforms

Energy Business

Founder Yutaka Kubota● Manufacture of2021
Integration of Power Engineeringand Energy Business domains

Market Trends
Launch of the Business Segment

Nippon Koei’s Origins

Business Fields

Energy Business

Power Engineering¥8.0 billion¥22.5 billion¥18.7 billion

Consulting Business

Domestic Consulting

Contributed to postwar reconstruction
and the creation of basic local
infrastructure in Japan and abroad

Net sales¥88.5 billion

FYE March 2010

FYE March 1970

1946-1970 Establishment Phase¥50.0 billion■ Consulting:■ Power Engineering: ¥13.2 billion¥29.9 billion■Consulting:■Power Engineering: ¥26.2 billion¥4.6 billion■Consulting:■Power Engineering: ¥3.4 billion■ Consulting:■ Urban & Spatial
Development:■ Energy:

electrical facilities● Mechanical andelectrical consulting● Geotechnical surveying,sale of civil engineering
measurement devices● Manufacture of safety
gear and equipment● Energy management

Business Fields● Urban development● Infrastructure● Comprehensive

research● Architecture

NIPPON KOEI GROUP INTEGRATED REPORT 2022 4

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Business Areas of Nippon Koei Group

M aa SAI

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Regional Develo

Dis a

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Each of the three business segments of the Nippon Koei Group develops specialized services and products in line with our
founding mission to pursue innovation and new challenges.

Urban & Spatial Development Business

Consulting BusinessMeeting urban development demand with architectural design
services worldwide

Infrastructure construction and maintenanceand various projects providing a foundation
for comfortable lifestyles

Dams
Hydroelectric power plants

Engineering consultants use their specialized civilengineering and architecture technology to prepare,
examine, and propose technologies for national, local,
and city infrastructure projects to national (preliminary
government agencies) and local governments, overseas
governmental institutions, and private companies.
Consultants also conduct studies and environmental
assessments, design projects, and supervise theproject construction, management, and maintenance.
In Japan and overseas, projects can vary immensely
in terms of scale and the type of contract. In Japan,
the government conceives and generally supervises
projects with consultants mainly performing thestudies, planning, and design operations. Overseas,
consultants can carry out the overall supervision of a
project from the initial conception stages to the final
construction. In Japan, we receive 3,500 consulting
orders annually and most projects are completed
within the same fiscal year. The International
Consulting Business often engages in large-scale
projects that can last several years.
Our range of business has been growing substantiallyin recent years, particularly related to the increase indisaster restoration projects, risk management fordisaster prevention and mitigation, improving andupgrading the existing infrastructure, and for
management advisory and monitoring for public-private
partnerships (PPPs) and private finance initiatives (PFIs).
For social issues that are becoming increasingly
complex, engineering consultants must havecomprehensive abilities with higher levels of expertiseand technical capabilities incorporating various
technologies. The Nippon Koei Group is taking on anever-expanding role as a comprehensive business
partner in the development of social infrastructure.

Harbors

Water Purification Plants

Power Grid System

Energy Business
Bridges

Helping Japan and other countries meet electric power demand
Tunnels
Airports

Roads and Transportation
Architecture

Energy Storage

Consulting

Overseas

Consulting

Engineering
Consulting Roles

Conception, Proposal/
Planning Feasibility
studies

5 NIPPON KOEI GROUP INTEGRATED REPORT 2022

RiversWaterworks

Sewage Facilities● Nippon Koei Services (for other companies)

Energy Business domain
DesignJapan

The Company is involved in the construction and renovation of substations
and power plant facilities, the provision of comprehensive consulting services
related to electric power and electrical facilities in Japan and overseas, and the
manufacture of power-related equipment and devices, such as centralized
monitoring and control systems for power systems and dam management
systems for hydroelectric power plants. The operations of these divisions give
the Power Engineering Business the formidable advantage of offering services
covering every stage of development and operation from planning, studying,and designing to building facilities, manufacturing equipment, and providing
operation maintenance for electric power generation and electrical equipment
in Japan and overseas.
In addition, amidst the drastic changes occurring around the world inbusinesses related to renewable energy, we have implemented energy
management services in Europe for hydroelectric power plant operations andpower distribution networks that stably manage and control energy provided
by various power sources through storage batteries with the aim of expanding
these services to power generation, transmission, and distribution businesses
in Japan.

RailwaysEngineering Consulting Work Process
Planning, Studies

Renewable Energy

Substations
Agricultural Facilities

Architecture makes up a significant percentage of the worldwide sales of
construction design companies. With demand for urban and spatial
development soaring worldwide, Nippon Koei brought the U.K.-basedarchitectural design company BDP Holdings into the Group in March 2016,
followed by the Canadian firm Quadrangle in February 2019, and U.K.-based
Pattern in July 2021. In Japan, we merged our former Urban & Spatial
Development Business, one of our business segments, with Tamano
Consultants, a Group company, to launch Nippon Koei Urban Space in July
2022. Together with the new company and Kisho Kurokawa architect &associates, we are working to develop new markets for urban development
and redevelopment, public-private partnerships, and smart cities, and tocreate urban spaces that meet the needs of a new era.

Basic design/
Detailed design

Construction

Operation, Management

Construction (general contractor)

Construction (general contractor)
Construction supervision (consultant)

Project tender
Assistance/
Document
preparation

Support bid
evaluation andselection

Contractmanagement/
Construction
supervision

MaintenanceConsulting

Facilities

Monitoring/Countermeasureproposals

Hydroelectric power plants
Plants where power is generated using solar power,
wind power, and other energy sources
Hydroelectric Power Generation Facilities(generators, dam management systems,
and turbines)

Consulting

Operation
instruction/
Management
consulting● Asset Maintenance Business (operations provided by Nippon Koei)

Powertransmission Power Transformation

Power generation

Services
Provided by
Nippon Koei

● Study and design● Equipment manufacturing andprocurement● Construction and civil engineering● Operation and maintenance● Monitoring systems● Hydroelectric power generation

Other Types of Power
Generation Facilities● Study and design● Equipment

Distribution

Storage/Electric Power Use
Energy Storage
For plants, commercial facilities,
households (consumers)

Substations

Substation Facilities(central monitoring andcontrol systems)● Study and design● Equipment

procurement
procurement● Construction and civil● Construction and civilengineeringengineering● Provision of power● Monitoring systems
transformation systems

Power Storage Facilities● Study and design● Equipment procurement● Construction and civil engineering● Provision of power transformation

systems● Energy management systems● Virtual Power Plant (VPP)

business*

Consumer Power
Facilities● Energy conservation

consulting● Provision of Energy

Management
Systems (EMS)● Energy Service

Company (ESCO)
business

NIPPON KOEI GROUP INTEGRATED REPORT 2022 6

We aim to achieve long-term goals in both financial
and non-financial areas of our businesswhile moving past milestones on our roadmap
one by one in order to realize our aspirationsin 10 years ahead.
Hiroaki Shinya
Representative Director and President

Looking back on my first year as
President of Nippon Koei

Should they be evacuated to safer areas within Ukraine or should

performance over the previous year. As a result, I am proud to saysolving social issues. Currently, urban development projects

they be considered for evacuation outside the country? Since

that we are off to a good start as planned.

designed to solve or prevent social issues caused by climate

Overcoming both short-term and long-term risks

opportunity for our company. For example, the foundation of urban

made me feel a greater sense of responsibility as a chief executive,

The major social turmoil brought about by the COVID-19

development is the world of civil engineering. Over that foundation,

a completely different level from in the past. Without a doubt, it was

pandemic is finally coming to an end as man has learned to live

there are buildings that serve as bases for people's activities, andthe most memorable year of my career.

“with Corona.” I expect that geopolitical risks, including the conflictenergy is necessary for an entire city to operate. These threevarious sources and make a final decision as a company. ThisA year in which we faced major changes in society
When I was appointed President of Nippon Koei in July 2021, thebusiness environment, which had been transformed by thechange are increasing on a global scale, and I see this as a great

human lives were at stake, we had to consolidate information fromCOVID-19 pandemic, was still in a state of chaos with no signs ofOn the other hand, looking at the results of the past year, we

in Myanmar and Ukraine, will be resolved in the short- to medium-

requirements (civil engineering, buildings, and energy) lead to thesettling down. Six months before that, there was a political upheaval

have made a very good start as the first year of the new Medium-

term based on a long-term perspective. Companies are required to

discussion of the development of “smart cities” for which various

in Myanmar, where major economic growth was expected due toterm Management Plan (hereinafter “Medium-term Plan”). Since thishave a strong management base that can withstand theseissues, such as global environmental issues, are taken into account.

democratization, and the future of business development in

was also the first year of the Long-term Management Strategy

unforeseeable short- to medium-term risks, but at the same time

In the world of investment, which is indispensable for urban

Myanmar, where we had been expecting business growth, became(hereinafter “Long-term Strategy”) for the three Medium-term Plan

they must also face long-term risks such as climate change thatdevelopment projects, ESG investment is becoming theuncertain. In February 2022, Russia launched an invasion of Ukraine.

periods, I was determined that the Company make a fresh start. As

cannot be resolved after just a few years.

mainstream. In order to attract ESG investment, Nippon Koei itself

Looking at this and other events, I think it was a year in which wea member of top management, I have been mindful of how to makefaced major changes in the current era.

the start of the new fiscal year a good one. Although ourcontinue to exist as a major risk and opportunity as we strive tomanagement. I feel firsthand that the world is changing dramatically

performance itself was affected by the COVID-19 pandemic, we

achieve our major goal of continuing our business for the next 100

in a direction that demands such sustainable management.

Ukraine, the Company was faced with a major decision: How dotook measures in anticipation of changes in the businessto 200 years. Climate change is both a risk and an opportunity

we ensure the safety of the people involved in these projects?

environment and were able to make a significant jump in

because, quite simply, we are a company that is in the business of

As two of our urban development projects were underway in

7 NIPPON KOEI GROUP INTEGRATED REPORT 2022

At the Nippon Koei Group, we believe that climate change willmust be a corporate group that is committed to sustainable

Our Management Philosophy is “Act with integrity and contributeto society through technology and engineering.” As a company, we

NIPPON KOEI GROUP INTEGRATED REPORT 2022 8

Message from the President
are proud that our business itself is benefiting the world, and I

UK will be completed in due course. We can expect further growth

personally believe that the pinnacle of our mission, vision, andas these projects start running.

values is serving the world and serving others. I believe that thegreatest strength of our Group is that all employees share the same
mindset of acting with integrity and contributing to society throughtechnology and engineering.

Human resource development is the key tosustaining strong business performance
I recognize that human resource development is the key tomaintaining our strong business performance in the future. Since

Performance in the fiscal year ended
June 2022

the way we work has changed dramatically due to the COVID-19
pandemic and especially now that the awareness of workers haschanged dramatically, I feel that we cannot respond to changes insociety if we think of human resource development as an extension

Achieving record high profits
We achieved record high profits during the fiscal year ended Juneof our pre-COVID approach to human resource development. In a
consulting Group like ours, the performance of each employee is2022. While the amount of orders that we received was almost thedirectly linked to the overall performance of the Group, so it issame as in the previous fiscal year, other indicators increased tonecessary to reconstruct a human resource development system

record highs. As a result, Nippon Koei has already approachedthat matches the current social situation and worker awareness.

targets established for the second year of the Medium-term Plan

We define “hybrid human resources” as human resources whoduring the first year of the plan. However, according to our analysis,

are well versed in both domestic and overseas businesses. I believe

this result was largely helped by the business environment. In

that the ideal balance should be that 40% of our human resources

Japan, the public works field was relatively strong and supported

consist of these hybrid human resources, 30% consist of specialists

our overall business results. Overseas, where measures for living

specializing in overseas business, and 30% consist of specialists

with the COVID-19 pandemic are more established than in Japan,

specializing in domestic (Japan-based) business. If the hybrid

economic activity returned to the same level as before thehuman resources, which ideally make up 40% of employees, canpandemic and various business conditions improved, such as theflexibly switch between domestic and overseas business balance

rapid expansion of opportunities for our overseas staff for whichby standing up to the risks of the moment, such as infectious

they can play an active role. I think that the ability to take advantage

disease outbreaks and regional conflicts, I believe that we can bothto a new group structure centered on the holding companyof these trends was a major factor in achieving record profits. My

maximize profits through flexible organizational management andIntegrated Design & Engineering Holdings.

appointment as President during the COVID-19 pandemic mademanage organizational risks.

Transition to a pure holding company
and Group management
Aiming for the independence of three business fields
In August 2022, the Nippon Koei Group announced the transition

There are three main objectives of the transition to a pure holding

me strongly realize how important it is to link solutions to various

In addition, one of the things I would like to see us focus on in thecompany. The first is to “strengthen governance and expedite

social issues around the world to our businesses, which in turn

future in terms of human resource development is the development

decision-making.” The second is the promotion of “autonomy &leads to the sustainability of our business.

of education and training systems on a global scale. Until now,

synergy.” By collaborating with each other, each of the operating

although employees in Japan have been able to receive nearly thecompanies, which are independently profitable and self-supporting,Consulting Business supported our overall business. In the Urban &same type of education and training, there was no common

will create unprecedented added value, and each company will aim

Spatial Development Business, both BDP, based in the UK, andeducation and training platform that could be operated overseas.

to achieve sustainable growth and increase corporate value overQuadrangle, based in Canada, performed well, contributing

Since employees of overseas Group companies are very motivatedthe medium to long term. The third objective is to “ensure diversity.”

significantly to record profits. In July 2022, we merged our Urban &to advance their careers and skills, we plan to create an e-learning

Through matrix management based on cooperation between the

Spatial Development Business with Tamano Consultants Co., Ltd.

platform for new employee training and other types of training thatbusiness axis and regional axis, we will build a global governanceto start Nippon Koei Urban Space Co., Ltd. With this move, I am

everyone should take, and make it accessible from all over thesystem that allows each organization within the Group to make thelooking forward to a great leap forward for us in the Japanese

world so that they can receive the same education and training as

most of its individuality and realize solutions to issues in eachmarket. In the Energy Business, the manufacturing departments

in Japan. We intend to make the educational content, which isregion.

behind our mainstay products for electric power companies are

currently only available in Japanese, available in English, Spanish,currently being restructured to improve production efficiency andPortuguese, and other languages in the future, and to makestemming from the second and third objectives, the synergies thatstrengthen management systems. In other words, to transformstratified training available from countries around the world.

will be generated by strengthening cooperation and ensuring

them into smart factories, which is a priority issue for the current

Ultimately, each employee will be able to see for themselves how

diversity through the spin-off of the operating companies. Among

fiscal year. In addition, while the soaring prices of crude oil andthey have grown and also visualize how they are being evaluated.

the three resilience measures set forth in the Medium-term Plan,

natural gas have become a problem, the energy management

We are building a new platform NKG Global Academy to realize this“Promote business based on the independence of our threebusiness is preparing to respond to the rising demand for energy,

kind of human resource development and are currently making thebusinesses” is positioned at the top of the list, and each of theespecially in Europe. The aggregation services we have been

fundamental parts of the academy carefully one by one.

Consulting Business, Urban & Spatial Development Business, andLooking at the results by segment, steady growth in thestronger than ever before. One of the expectations and challenges
is collaboration among operating companies. Until now, the threebusiness segments have been cooperating like siblings. After the
spin-off, however, it will be necessary for the segments to respect
each other and deepen cooperation through an independent“partner-style” relationship. In addition, we will actively invite newcolleagues from outside the Group through M&A and businessalliances in the future, and have them bring in values that have notbeen previously seen in the Nippon Koei Group, which will stimulate
business and create new social value. I hope that such new
relationships and work environments will be created. Since theholding company structure is designed to improve the quality ofservice and corporate value for our customers, we must make surethat our customers are pleased with service that is “better than
before.” I believe that the key to this is strengthening cooperation
among operating companies.
We plan to gradually transition to a pure holding company from
July 2023. Our long-term strategy and Medium-term Plan are
based on this transition. I would like for the entire plan, including theachievement of each goal of the Medium-term Plan, to be
implemented with a sense of speed faster than planned.

Personally, I am particularly looking forward to the results

Commercializing solutions for various
social issues through the new structure
Reflecting the solutions to social issues that need tobe resolved in our materiality
As I mentioned, solving social issues as a business is very

developing in Belgium and the UK, where we have actively invested,

Energy Business, which were previously business divisions ofimportant for our sustainability. Therefore, as a specificare currently constructing energy storage facilities that will serve as

Nippon Koei, are now recognized by the world as a single

methodology, we have tied the various social issues that we need

the foundation for these services. One location is scheduled to becorporate organization respectively. I believe that making each of

to solve to the materiality (key issues) defined in our long-term

completed in Belgium in January 2023. Two more locations in thethem independent will make the business axis of the entire Groupstrategy. Each business division establishes “priority measures”

9 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 10

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Message from the President
every year, checks the relationship between the priority measures

Further promotion of sustainability management

and materiality, and makes sure that it is heading in the right

It goes without saying that we also set many milestones related

direction, making the measures pillars of our business plan.

to ESG and sustainability. In September 2021, we established theOn the other hand, we hold TRM (Total Risk Management)

Sustainability Promotion Committee and formulated our Basic

meetings as needed to discuss our own risk management, tying it

Sustainability Policy in February 2022. Serving as a guideline forto the materiality of management activities, which is set insolving social issues through our business activities, this basic

conjunction with the materiality for business activities. Concerns

policy shows that our business and sustainability are inseparable.

Transition to a Holding Company Structure
Transition to a holding company
structure - background and objectives

Group structure after transition to aholding company

The Group aims to achieve solid growth in the future
by strengthening independent activities that takeadvantage of the characteristics of each businessWe will spin off each business, expand theauthority of major Group companies, and createa strong group of operating companies

about information security, which is growing in line with the

To date, the Group has developed tools for evaluating thedestabilization of the world situation, and workplace-basedsustainability activities and progress of SDGs in national and local

holding company effective July 2023. In our Long-termharassment, which has become an issue along with the raising

governments as well as private companies, which are ourManagement Strategy toward 2030, continuing to respond tocontrol the business management subsidiary (Nippon Koei

awareness of human rights, are among the top operational risks forcustomers. Thus, we have developed the skills of evaluating thesocial issues as the basis of our strategy, we have positioned

Business Partners Co., Ltd.) as well as Consulting Businessthe Group. Before the terms CSR and sustainability were firmly

initiatives and progress of other companies as necessary for our“Consulting,” “Urban & Spacial Development,” and “Energy” assubsidiary (Nippon Koei Co., Ltd.), two Urban & Spatial

established in Japan, business risks were the risks thatbusiness. In the future, we will use the skills we have developed tothe three core businesses and aim for their further growth. In

Development Business subsidiaries (Nippon Koei Urban Space

management needed to face. However, in modern corporate

diagnose our own sustainability activities and SDGs initiatives, andorder to strengthen our business competitiveness while

Co., Ltd. and UK-based architectural design company BDP

management, dealing with ESG and sustainability-related risks haveevaluate ourselves to see how much we have achieved this year

responding to changes in the external environment, it isHoldings Limited), and Energy Business subsidiary (Nippon

become more fundamental to the survival of a company.

compared to our vision for the Group. In addition, we will consider

necessary to create an organizational culture that respects the

Koei Energy Solutions Co., Ltd.) as primary businessquantifying growth targets in non-financial fields such as ESG anddiversity of each organization within the larger group by taking

companies. The four companies responsible for these majorsocial issues under the new group structure, I believe that it issustainability in an easy-to-understand manner as KPIs andadvantage of their individual characteristics, and to aim atbusinesses and functions are positioned as “Major Groupfundamental for each operating company that will be independent

incorporating them into our long-term strategy and Medium-term

creating a system that allows them to operate independently

Companies,” and the authority of each company will beafter the conversion to a holding company to thoroughly address

Plan. At the same time, we will promote sustainability initiatives,(autonomously). In order to achieve this, we have determined

expanded to enable accurate and prompt decision-making.

materiality.

such as endorsing the TCFD recommendations and complying withthat the best way to create a platform for the Group to make a

the revised Corporate Governance Code, that are required ofleap forward is to transition to a holding company. Under thiscompanies listed on the Prime Market of the Tokyo Stockstructure, we will strive for autonomy & synergy, fasterExchange.

decision-making, and the coexistence of diversity. The

In any case, in order to continue promoting businesses that solve

Making it past milestones one by one

organizational structure of the holding company was designed

To our stakeholders

as a company with a nominating committee, etc. Afterestablishing a supervisory structure with the Nominating,

When I was appointed President one year ago, I declared that I

Compensation, and Audit Committees, in which outside

2030, we plan to draw a roadmap to achieve our goals andwould make Nippon Koei become “by far the No.1 consulting anddirectors constitute the majority, we will specialize in group

establish milestones for each point to be addressed. These

engineering firm in Japan and indispensable to the world.” In ordermanagement, determine the appropriate allocation ofmilestones include various management indicators, such as

to achieve this, I feel that it is of utmost importance to fulfill ourmanagement resources and the design of functions andrevenue, orders received, and ROE, that are easy to understand bysocial responsibilities as a Group, such as contributing to the SDGs

systems to maximize value as a group, and formulate

people outside the Group. However, we also establish milestones

and resolving social issues, as well as achieving the goals of eachstrategies and plans as a group. We will deepen thethat enable employees to feel their own growth within the company,

management index, which has traditionally been emphasized. Our

management of the Group from a medium- to long-termsuch as the extent to which business process innovation has

business operations are linked to almost all of the 17 goals and 169

perspective and aim for solid growth in the future.

progressed through DX.

targets of the SDG agenda. For the Group, sustainability is nothing

In order to enhance the feasibility of our long-term strategy for

Recently, in particular, changes in the world have been

more than achieving each of the indicators indicated in the 169

Naming of the holding company

accelerating, and I think that the line between firms that are unabletargets of the SDGs through our business. Our strength has always

to take advantage of these changes and remain stagnant, and firms

been our ability to solve social issues and grow together withthat are rapidly growing by taking advantage of the current trends

society through our sustainable business activities. We will continue

has become clearer than ever. Digital transformation (DX) is one of

to do so without making any changes to our Management

those changes. Since most of our work involves the visualization ofPhilosophy “Act with integrity and contribute to society through

Design & Engineering Holdings Co., Ltd. The words “Design”

ideas and blueprints on paper, we have a relationship with digitaltechnology and engineering.” I would like to ask all of ourand “Engineering” represent our company as an integrated civil

technology that makes it indispensable. For this reason, in the paststakeholders for their continued support as we look forward to theengineering consulting firm that has promoted civil engineeringfew years there has been a strong sense of crisis that if we fail to go

future of our Group, which will be reborn as ID&E Holdings in Julyand architecture, while also expressing our desire to integrateahead with digitalization we will be eliminated from the market.

2023.

(using the word “Integrated”) various fields in the future and

For integrating various fields and increasing our
new friends

Group Structure (from October 2023)
Consulting Segment
Nippon Koei Co., Ltd.

Group Companies

Urban & Spatial Development Segment
Nippon Koei
Urban Space Co., Ltd.

Group Companies

BDP Holdings Ltd.

Group Companies

Energy Segment
Nippon Koei Energy
Solutions Co., Ltd.

Group Companies

Nippon Koei Business
Partners Co., Ltd.

Timeline

We decided to name the pure holding company Integrated

Without the implementation of advanced digital technology to thepromote the Company as a one-stop business. In addition, theextent that we can say “We can take on everything as a one-stop

new name was chosen to signify that the Group will expand toprovider”, I fear that we will never reach our goal to be “by far the

become larger than ever with the addition of new friends.

No.1 consulting and engineering firm in Japan and indispensable toIntegrated Design & Engineering Holdings Co., Ltd., which
will be the new pure holding company, will place under its

Integrated Design & Engineering Holdings Co., Ltd.

Toward achieving our long-term
strategy

The Nippon Koei Group has decided to transition to a

July 2022

Nippon Koei’s Urban & Spatial Development
Business is merged with Tamano Consultants Co.,
Ltd. to launch Nippon Koei Urban Space Co., Ltd.

September 2022

Resolution at the General Meeting of
Shareholders on the share transfer plan andamendment to the articles of incorporation

July 2023

Establishment of Integrated Design &Engineering Holdings Co., Ltd.
Spin-off of Nippon Koei Business Partners Co., Ltd.

October 2023

Spin-off of Nippon Koei Energy Solutions Co., Ltd.

Name of the new holding company

the world,” and that it will be difficult to even remain at the top of
the Japanese market.

11 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Integrated Design & Engineering Holdings Co., Ltd.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 12

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Nippon Koei Group Value Creation Processement of Stre
ngth
ReinforcsStrengths of Nippon Koei Group
Solving society’ s constantly evolving needs utilizing ourabundant human resources and reliable technologies

Social Contribution

Customers

P.22

▲

▲

Awarenessof External
Conditions

Consulting
Business
Development of Safe andReliable Regions

P.57

Shareholders,investors■ Climate change and lackof resourcesLong-Term
Management Strategy

Integrated
Capabilities■ Intensification ofdisasters▲

P.19

Technology

P.17

P.18

P.59

National and local
governments,
industry groups

Building Resilience 2024
▲

P.61

▲

Urban & Spatial
Development
Business■ Changing work styles▲

P.21“Making the world
a better place”
Energy solutions

P.27

Regional
Society
Academicgroups,research
institutes

Materiality

MISSION

P.21

Medium-Term
Management Plan

EnergyBusiness▲■ Digital transformation

Solutions for
Urban Issues

Number of
employees■ Rapid urbanization■ Shift in global economic
power

SuppliersNKG Global Strategy 2030▲▲

■ Changes in demographic
structure▲

Human
Resources

Urban and Regional
Revitalization

Environmental Measures
Infrastructure Development

Smart City Development● Development of a safe and reliable infrastructure

Business
activities● Creating attractive cities● Development of smart societies● Challenge to decarbonization● Enhancement of governance● Human resource development andManagement
Philosophy

Management technical development
activities ● Work environment where humanrights are respected and job
satisfaction is high“Act with integrity and contribute to society
through technology and engineering.”

13 NIPPON KOEI GROUP INTEGRATED REPORT 2022

The Nippon Koei Group has a foundation for creating value that has been cultivated since its
establishment, and our Management Philosophy “Act with integrity and contribute to society throughtechnology and engineering” is the basis for our actions in any era.
Based on a business environment in which opportunities and risks come at the same time, we will
determine materiality, face a mountain of social issues, and work to demonstrate our comprehensive
capabilities through human resources and technologies, which have been the strengths we havecultivated since our founding, and cooperation between segments.
By providing solutions to society and customers, we create environmental as well as social value, andaim to realize the Group's Mission of “Making the world a better place.” By achieving this, we will
enhance our competitive advantage and enhance our strengths, which will lead to our own sustainablegrowth.
In order to continue to have a presence in society as being an indispensable organization, we will createsocial and economic value by solving social issues associated with the development of each country andregion around the world through our business activities.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 14

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Creating Value through Nippon Koei Group
Capital and its Utilization
Important Aim of Capitalin Value Creation

Financial
capitalAchieve a balance between
growth and returns bybuilding a strong financialbase and achieving highcapital efficiency that allows
for flexible investment

Policy for Medium/Long-term Enhancement

FYE June 2022 Main Initiatives(Input)Realization of medium/long-term growth● Secure long-term borrowings by executing investment● Review and enhance investment screening criteria as well as establish and enhance

projects● Ensure financial soundness based on an awareness of ourequity ratio● Build and strengthen a new monitoring system afterinvestment execution

investment screening system
Ensure financial soundness● To ensure financial soundness, maintain an equity ratio of approximately 40% even during
periods of concentrated investment

FYE June 2022 Results(Output)● 44.9% equity ratio (45.3% in the previous period)● 8.8% ROE (6.7% in the previous period)● 28.6% payout ratio (25.0% in the previous period)● Rating and Investment Information, Inc. (R&I) rating of BBB+ (same rating to be

maintained from November 2020)● Eliminated losses characteristic of the first half of each fiscal year to return the Groupto profit

Provide capital efficiency to achieve a balance between growth and returns● Aim for an ROE of 9% in the Medium-term Management Plan
● Aim for a payout ratio of 30%● Buyback/cancellation of treasury stock as necessary to achieve an appropriate total return ratio

Manufacturing
capitalCreate a safe and secure
infrastructure by providing
services in more than 160
countries, in all prefecturesin Japan, and throughoverseas offices around theworld

Promote workplace reform● Develop a post-Covid-19 workplace environment

Improve quality of information systems● Enhance support for diverse work styles● Enhance financial and accounting systems● Establish shared platform for group companies● Improve workplace environment● Promote digitization of various documents● Strengthen remote access● Introduce cybersecurity measures based on the concept ofZero Trust● Promoted the utilization of four satellite offices● Continued a system that enables remote access for all employees● Promote remote work through the computerization of stamping and paper-based

work processes● Realize no information system failures that have significant social impact

Enhance information security● Implement cybersecurity measures based on the concept of Zero TrustIntellectual
capitalAccumulate advanced
intellectual capital throughthe foundation of advanced
technology research at the
Research & Development
Center and knowledge
gained through advanced
operations while creating
new value throughinnovation

Drive all types of value
creation through a diverse
workforce of highly
specialized domestic andinternational professionals

Development and utilization of DX technologies● Search for/develop key themes that will lead to new● Number of certified professional engineers (consolidated): 1,743 (1,727 in the● Expand DX investment

businesses in the DX field● Promote collaboration to create business models● Establish platform for sharing technical information ontechnology and sales● R&D expenses: ¥1.24 billion (¥1.07 billion in the previous period)● Conducted several demonstration tests with the Tokyo Metropolitan Government andBusiness development investment● Conduct research and development for new business development from a medium- tolong-term perspective● Conduct research and development for the creation of new business areas such as smart
city business development, SDGs business development, and climate change business● Strengthen development of qualification and humanresource development programs● Manage employee work attendance rate during the COVID-19
pandemic using a workplace hoteling system and RPA● Improve productivity through DX (RPA, AI, etc.)● Health management: Implement vaccination programs inworkplaces● Enhance the recruitment of new graduates and career
employees● Turn Aichi Tamano Information System Co., Ltd. into a
special subsidiary of Nippon Koei to provide more
employment possibilities for people with disabilities

talent management, and various data
● Expand regional engineer system (a training system that enables engineers from local

subsidiaries to work in countries other than their countries of origin or Japan)

Human capital

the Kyushu Regional Development Bureau of the Ministry of Land, Infrastructure,
Transport and Tourism● Developed DNA tracer technology in collaboration with Yamaguchi University andturn it into intellectual property● Opened a metaverse (virtual space) to promote tourist attractions in cooperation with
Ureshino City, Saga Prefecture and other organizations

Develop and improve employee skills
raise the level of human resource capabilities of the entire group

Enhance recruitment● Increase the number of employees by more than 1,600 on a consolidated basis during theperiod of the Medium-term Management Plan by strengthening the recruitment of new
graduates and career employees

municipalities in Tochigi Prefecture, etc. for the practical application of automated driving● Conducted study on adaptation to digitalization of disaster assessment as a task of● Establish “NKG Global Academy” in FYE June 2024 which all group employees can use to● Visualize knowledge and develop leaders by effectively utilizing knowledge management,

previous period)● Number of employees (consolidated): 6,163 (5,936 in the previous period)● Recognition as an Outstanding Health and Productivity Management Organization

2022 (White 500) for four consecutive years● In-house release of similar business estimation service utilizing RPA and AI● Recruitment Numbers

Number of new graduates recruited: 151 (162 in the previous period)
Number of career employees recruited: 48 (43 in the previous period)● Employment rate of disabled persons: 2.69% (2.09% in the previous period)

Promotion of Well-Being Management● Promote work styles that respect diversity

Social capital

Natural capital

Stable and continuous
value creation through asolid client base andstrengthened relationships
with partner companies,
etc. based on a long history
and track record of
supporting developing
countries through domestic
infrastructure and ODA

Contribute to thepreservation of the global
environment by contributing
to environmental
preservation and reducing
environmental impact
through our business

15 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Co-creation with other companies including those in different industries● Promote collaboration in the field of disaster prevention and● Create stable and long-term cooperative relationships with partner companies in Japan andmitigation using advanced technologies● Promote business alliances in the smart city andtransportation fields with local governments andcompanies in Japan and overseas

overseas
Transfer technologies to developing countries● Develop human resources in developing countries through “NKG Global Academy” andcollaborate with academic institutions
Strengthen social activities● Enhance opportunities for dialogue with stakeholders

Enhance sustainability promotion● Provide consulting services for greenhouse gas reduction,● Establish Sustainability Promotion Committee

climate change adaptation measures, and biodiversity
conservation● Implement disaster countermeasure projects utilizing newtechnologies such as AI● Promote research on green infrastructure andenvironmental risks

Focus on business creation through co-creation by linking materiality and businessstrategy● Equity participation in space development venture Q-shu Pioneers of Space, Inc.
● Formed a partnership agreement with Iwaki City in Fukushima Prefecture for thepromotion of river basin flood control● Created business alliances with Surbana Jurong Private Limited (Singapore), DHI(Denmark), PT Jakarta Lingko Indonesia and PT Aino Indonesia (Indonesia), andsocial enterprise Siem Reap Tourism Club (STC) (Cambodia)● Nippon Koei India received an Award for Excellence at the Rail Analysis Innovation &Excellence Summit 2022
● BDP Quadrangle received a Canadian Governor General’s Medal in Architecture● Nippon Koei employees received the Ozawa Award for Distinguished Service
Overseas for their long-term contributions to land development overseas● Published the results of joint research in an international academic journal on therelaxing effect of diverse insect sounds● Released the beta version of “TSUMUGI@”, an SDG diagnostic tool for municipalities● Our research team comprised of members from the R&D Center and other locations

won the Hydraulic Engineering Paper Award for their research contributing to theunderstanding of water resource risks and countermeasures16

Introduction

Strategy

Sustainability/ESG

Review of Operations

Human Resources Strategy

Human Resources and Technologies that
Support Our Business Model

Increase recruitment of new graduates
In order to respond to Japan’s national resilience plan and the global demand for infrastructure, we are
increasing the number of our employees. Specifically, we established a plan to significantly increase thenumber of new graduates who will be responsible for the future of the Group from 2019 to hire more thanThe greatest strength of the Nippon Koei Group is that it has experts in various fields and excellent professional humanresources as an integrated civil engineering consulting firm. We are working to create businesses that attract such humanresources and further strengthen our excellent human resource development system.
As a group of professionals united in our Mission of “Making the world a better place,” we aim to achieve a higher level ofresults by enabling all of our employees to always use their abilities and skills to accomplish our Mission.

150 employees every year. The Nippon Koei Group continues to recruit on this scale and is expanding its

Number of new university graduates hired(total for Group companies in Japan)(persons)
250
200

206

205

21/6

22/6

187
173

post-entry training programs.
150

Increase the number of certified professional engineers

105
100

Construction consulting services in Japan are required to be performed by certified professional
engineers. Therefore, in order to bid on a large number of projects, it is necessary to secure certified

The Group is focusing on theacquisition of diverse humanresources, including new graduates,
mid-career recruits, and foreigners. In
recent years, we have been
strategically increasing the number of
new graduate hires every year andhave a policy of developing excellent
professionals based on a long-term
perspective. In addition, in order toachieve the goal of increasing the ratioof female managers to 15% by 2030,
we have set the ratio of female
employees at the time of hiring new
graduates as a KPI.

Status of the Company

50

professional engineers. The Nippon Koei Group has 1,743 professional engineers in its construction,
We aim to provide new employees withan environment where they can learn
the basics of civil engineering toacquire professional engineer
certification, the highest qualification
for a consultant in this business.
In addition, we have established avariety of other courses and arebuilding a system to make thesecourses available to all employees.

Human Resource
Development

comprehensive engineering supervision, applied science, and water supply and sewerage departments,

0

18/6

19/6

20/6

boasting the highest number of certified professional engineers in the industry. We support individuals
seeking to become certified professional engineers by offering annual preparation seminars for thecertification examination.

Number of certified professional engineers(total for Group companies in Japan)(persons)

Hybrid human resource development

1,800

1,700

resources” and plan to increase the ratio of this human resource type. In addition to aiming for global
expansion throughout the organization, we are efficiently allocating personnel resources from theOrder
Securement Human Resource
Reception
andof Diverse and Technological
Productivity
Human
Growth Cycle
Enhancement
Resources

1,600

1,584
1,534

of work-life balance, we aim to be a corporate group that can work in a variety of ways according to life
stages.

1,500

On the other hand, since the way business is conducted in Japan and overseas differs greatly, it isexpected that issues specific to hybrid human resources will arise. Therefore, we are promoting thequestionnaires. We are also strengthening training in language, project management (PM), safety

Individual/
Organizational
Growth

1,656
1,621

perspective of risk hedging to realize operations that minimize the impact of risks. From the perspective

development of labor and personnel evaluation, etc., by understanding actual conditions throughWe realize the growth cycle of theorganization as a whole by enabling
employees to gain experience inchallenging projects for individual
growth.
We will enhance the attractiveness of
the Group as an organization that candevelop expertise and work on anumber of challenging projects thathighly contribute to society.

1,743

1,727

We call human resources engaged in both domestic and overseas operations “hybrid human

We will increase orders for projects
based on technical proposals, avoiding
price competition, and enhance
corporate competitiveness.
At the same time, employees can growwith a sense of speed by being
involved in many social contribution
projects that require technical skills
from when they are young employees.

management, and other areas necessary for overseas operations.

1,400
17/6

18/6

20/6

21/6

22/6

R&D expenses (consolidated)(Millions of yen)
1,600
1,243

1,195

1,200

Technology Strategy

19/6

1,100

1,070

913

800

700

Promote technology strategies
In addition to technological development in each business division, since the fiscal year ended June

400

2017, the Group has been promoting technology policies in which multiple divisions work together todevelop technologies across the company. Under the Technology Committee under the Management0
17/6

Council, themes are established with the goal of “developing technologies and businesses that have an

Establishment of the NKG Global Academy, a human resources development
institution where all Nippon Koei Group employees can grow together

impact on Nippon Koei.” In order to derive business from these strategies, we hold a meeting once a year

Training young engineers, passing on skills to the next generation, andenhancing technical capabilities are a key issue for our company. As asolution, in June 2020 we established NK Academy, an in-housetraining program for young technical employees of the Nippon Koei
Group. We have started initiatives to share and deepen knowledge ineach specialized field efficiently in a short period of time byestablishing courses taught by in-house instructors and introducing
the Learning Management System (LMS).
In order to expand this initiative to include the entire Group, we areaiming to establish the NKG Global Academy. By consolidating
training within the Group, collaborating with academic institutions,
expanding learning content through multilingual support, and sharing
knowledge, we will raise the level of the abilities and skills of all
employees. We are currently preparing the content in stages with theaim of establishing the academy in the fiscal year ending June 2024.
The Nippon Koei Group is also looking to make it available to othercompanies in 2030 as a place where people from all over the world
can gather and learn.

DX promotion
Toward世界
world's top
トップクラスのclass human
人財へ
resources

Careerキャキャリア
リア
advancement
ア
ップ
アップ

training

DepartmentのIndividual 部門独自の
specific skill
self個の自律
スキル研修
training修
development
成長支援
support

21/6

22/6

A leader in digital innovation
NKG-DX Vision KPI

initiatives within the Group. We are working to raise awareness by holding DX related briefings andStratified
階層別研修

Group
グループ
company
会社研修

20/6

To become a company thatsolves problems for the future

In November 2022, we formulated the NKG DX Vision in order to enhance the momentum of DX
discussions for all employees and setting KPIs. We will use an in-house common digital platform toExternal
training

外部研修

19/6

NKG-DX Vision

to present the results of their implementation and are working to link the developed technology to theadvancement of more businesses.

18/6

training

evolve our Consulting and Engineering businesses, create and develop new businesses that solve social
issues, such as smart city services, and innovate internal productivity to build a sustainable society.

Total DX investment during the
Medium-term Management Plan

¥1.5 billion

FYE June 2024
Number of digital human resources*

100%* Employees who use RPA and AI in their normal work

Enhanced support for BIM/CIM
In principle, BIM/CIM* will be applied to all designs and works ordered by the Ministry of Land,
Infrastructure, Transport and Tourism starting in 2023. We are further strengthening our response to the

Number of Business Orders related to
BIM/CIM (non-consolidated)promotion of BIM/CIM and productivity improvement as a must-achieve goal that must be realized as(orders)

soon as possible.

156

160
137

BDP, a group company, has the most advanced technology in the BIM field not only in the U.K. but
also in all of Europe, and has achieved productivity improvements. Therefore, we send our mid-career120

and young employees to BDP for several months of training as a way to actively share technology within
87

the Group. In March 2022, we established the BIM/CIM Promotion Working Group within the Group for80
62

the preparation and monitoring of BIM/CIM promotion plans for each field and branch. The Nippon Koei
Group has also launched a BIM/CIM internal qualification system to motivate and inspire employees, and

53

40

31

has now started training and certification programs for acquiring entry-level qualifications.
* BIM (Building Information Modeling): A method of performing virtual construction work on a computer by combining a 3D model of the project and adesign information database
CIM (Construction Information Modeling): A method of managing the construction, maintenance, and production processes of civil infrastructure

17 NIPPON KOEI GROUP INTEGRATED REPORT 2022

0
17/6

18/6

19/6

20/6

21/6

22/6

NIPPON KOEI GROUP INTEGRATED REPORT 2022 18

Introduction

Integrated Capabilities of the Nippon Koei Group
Track record of development in 160 countries overseas
Number of Overseas
Orders (consolidated)

No. 1* in the industry
Countries and Regions
Track record in

160 countries

Case 173 locations

One example of this is the large-scale renovation of Miwa Power Station, which we received
an order for from the Nagano Prefectural Enterprise Bureau in 2020. The project involves thelarge-scale renovation of the location’s aging 12,200 kW dam-type power generation facilities
using new categories under the FIT (Feed-in Tariff) scheme. The design and construction
method (EPC) has been introduced. The Nippon Koei Group was highly evaluated for its trackrecord and experience in power generation and EPC utilizing its one-stop services as well as for* “Sales ranking of engineering consulting firms inJapan,” Nikkei Construction, April 20, 2022

The overseas revenue ratio target for
the fiscal year ending June 2024
EnergyUrban & Spatial
Development

Consulting

Regional Axis

Southeast Asia
South Asia

Matrix Management
Sub-Saharan Africa

Two axes exist - A vertical businessaxis and a horizontal regional axis

Europe, Central Asia, Middle East, and Northern Africa
Americas

Americas
7%

44%

Other
1%

FYE June 2024
Ratio of Revenue
by Region Plan

Japan
56%

South Asia
11%
Southeast Asia,
East Asia, and Oceania
9%Collaboration with diverse external partners
We aim to be a corporate Group that contributes to the realization of a society in which people canfeel that their lives have been enriched by providing new value through the exploration of knowledge andNumber of MOUs
the innovation and integration of technology through collaboration with diverse internal and external
Signedpartners in order to reach the universal goal of realizing a sustainable world.
(Memorandum of Understanding)In order to promote co-creation, we have been operating NARRES (NK Alliance Record Registration
System), an information management system that centrally manages various types of NKG alliance(as of June 2022)
information, since July 2022. Because of the confidentiality of alliances with external parties, there havebeen issues such as the inability to utilize alliances that have already been concluded widely. Thissystem solves these issues and realizes the centralized management of alliance information within theGroup.
Going forward, we will continue to aim for new collaborations and expansion of business possibilities from a Group-wide perspective.

22

19 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Railway project in Dhaka, Bangladesh - An example of what our civil engineering andarchitectural services can provide

In Dhaka, Bangladesh, which is one of the most densely populated cities in the world, theNippon Koei Group has received and implemented several Dhaka Metro Rail projects (Line 6,
Line 5 (Northern Route), and Line 1). For Line 5 (Northern Route), BDP, an architectural design
company which is part of the Nippon Koei Group, was responsible for the design of the stationbuilding. The railway project includes station construction, rail line development, MaaS and TOD(Transit Oriented Development: urban development that is based on public transportation andaims for a society that is not dependent on automobiles). We are promoting collaboration within
our group in this area where we can take advantage of our strength in integrating civilengineering and architecture.
The Japanese government's Official Development Assistance (ODA) to Bangladesh is thesecond largest in the world after India, causing a boom in infrastructure development. In orderto respond to this strong demand for infrastructure development in Bangladesh, the Nippon
Koei Group established a local subsidiary in Bangladesh in 2018 and is currently involved in over 30 projects there. Our Head Office in Tokyo and the local staff ofour subsidiary in Bangladesh are working together on projects. By training the local staff ourselves, we are contributing to the development of Bangladesh bytransferring Nippon Koei's technology to grow the subsidiary.

Case 3Sub-Saharan Africa
3%
Europe, Middle East,
Central Asia, and Northern Africa
13%

Miwa Power Station - An example of how our one-stop Services in the Energy Businesscan be utilized

its proposal to introduce new technologies.
In addition to these services, we are promoting business development centered on energy storage facilities in Europe, where the electricity market is ahead ofJapan. By utilizing this knowledge and providing one-stop services from EPC (engineering, procurement and design) to operation, we are developing solutions thatmeet the needs of our customers.

Overseas Bases

Under the current Medium-term Management Plan, we have established a group management structure that operates using a matrix consistingof a business axis based on three domains (Consulting, Urban & Spatial Development, and Energy) and a regional axis. With the Business
Promotion Headquarters at its core, branch offices, overseas offices, and Group companies rooted in Japan and around the world identify local
needs and provide one-stop services for business domains across regions. Each of our companies overseas operates independently and realizes
our motto, “Think globally, Act locally” for social issues and various needs around the world. In other words, they grasp issues from a global
perspective and solve them locally, proposing optimal solutions with a sense of urgency.
Through these efforts, we plan to increase our overseas sales ratio from the 37% (current level) to 44% in the fiscal year ending June 2024 and to
50% in the fiscal year ending June 2030.

Japan

Status of the Company

maintenance and management for power and electric facilities in Japan and overseas. The
realization of these services will bring various benefits to customers, such as reducing businesscosts as well as shortening construction periods and power generation shutdown periods.

Matrix management that provides one-stop services across regions

Business Axis

Review of Operations

Our Energy Business has the advantage of being able to provide one-stop services for all
stages from planning and research to design, construction, equipment manufacturing, andCase 2Matrix Management
Structure

Sustainability/ESG

Various Projects that Demonstrate Our Integrated Capabilities

The Nippon Koei Group deploys the integrated capabilities of experts in various fields to meet the increasingly sophisticatedand complex needs of our age to solve social issues.

The Nippon Koei Group has been involved in the development of social infrastructure overseas sincereceiving an order for the planning of the Baluchaung Hydropower Plant in Burma in 1954, which served as
the first step in the globalization of the Nippon Koei Group. We have continued to build infrastructure thatutilizes various Japanese technologies, including technologies for hydroelectric power plants, roads,
railways, bridges, and agriculture, and have continued a business model that simultaneously transfers
technology to the local community and realizes economic development.
While handling a number of overseas government projects such as ODA, we have established local
companies around the world, with the current number of overseas bases standing at 73. The knowledge
accumulated through our understanding of the characteristics and customs of countries and regions
around the world through projects since our founding is one of the strengths of our Group.
In our long-term management strategy, we have positioned the growth of overseas subsidiaries as thesource of profit growth, and are promoting measures such as strengthening the production systems of
local subsidiaries and group companies overseas to stabilize regional management, and training
management personnel for independent operation.

Strategy“Bosuke” - A disaster prevention platform utilizing knowledge accumulated in eachdepartment of Nippon Koei

Currently, too much disaster prevention information is provided from various sources, making
it difficult for local governments to access effective information, grasp the extent of damage, andmake appropriate decisions on evacuation orders for local communities. For this reason, we
have developed “Bosuke,” a water disaster prevention platform which enables centralizedvisualization of only the best data from this wide variety of information. The platform is equippedwith basic functions to display rainfall, flow rate, water level, and inundation depth in real timewith map data that incorporates topographical data, and can be customized with a high degreeof freedom to add AI analysis, AR/VR, and other features. In the development of this platform,
the company-wide technology strategy framework was utilized, and the specialized
technologies and knowledge from related departments were accumulated before the platform
was released in 2021. Since its release, we have been promoting its adoption and joint
development in various fields.
Currently, with the cooperation of Fujimino City, Saitama Prefecture, NTT Advanced
Technology Corporation, Toshiba Corporation, and Nippon Telegraph and Telephone East
Corporation, it utilizes highly accurate, real-time rainfall and flood prediction data. Since August
2022, we have been conducting field trials on the effectiveness of disaster response operations
by local government officials. In addition, the partnership agreement that the Group formed with
Iwaki City in Fukushima Prefecture for the promotion of river basin flood control in April 2022
aims to reduce flooding damage by promoting watershed flood control through demonstration
experiments using this platform.

Satellite
data

Accumulation ofvarious types of data
enables centralizedvisualizationRiver
camera data

Alarm data

SNS data

Floodsensor data

NIPPON KOEI GROUP INTEGRATED REPORT 2022 20

Introduction

Long-Term Management Strategy

The Nippon Koei Group believes that in order to achieve sustainable growth in light of surrounding business conditions, it isimportant to attract diverse human resources and co-create value in cooperation with external resources. Based on thisrecognition, we have established a Mission, Vision, and Values to widely share the direction in which our Group is headedwith those inside and outside the Group. In order for the Group to address global issues through its business activities and togrow sustainably with society, we have established materialities (key issues) that we will preferentially address by leveraging
our strengths.
Materialities of the Nippon Koei Group

Making the world a better place ▶

Vision

A company that provides unique value ▶

Values

Act with integrity andcontribute to society throughtechnology and engineering

Sustainability/ESG

Review of Operations

Status of the Company

Assumed values

Mission and Materiality

MissionStrategy

Business Activities-based Materiality
1. Development of infrastructures that allow people tolive safely and with peace of mind
2. Development of a social infrastructure that allows all
people to freely interact and engage in activities
3. Creating attractive cities with a diverse range of
people and industries
4. Preservation of the global environment through therealization of decarbonized societies

We at the Nippon Koei Group have been working to solve
numerous social issues that have existed since the era that our
founder, Yutaka Kubota, lived. The entrepreneurial mindset ofconnecting people and creating projects to solve social issues is
our starting point.
Inheriting the spirit of our founder, the Group has grown to thepresent day by continuing to provide business solutions to various
global and social issues that change with the times through theaccumulation of “wisdom,” as represented by our technologies. We
believe that our strength is our “integrated capabilities” based on
our human resources and technology, and that the source of ourstrength is the “wisdom” of each and every employee, which isbased on their “smarts,” “knowledge,” “skills”, and “outstanding
human qualities.”

The Company has been contributing to the world as an essential
business that contributes to the betterment of people's lives
through the collective “wisdom” of our employees, who look atsocial phenomena, determine the essence of issues, and findoptimal solutions with a sincere attitude by making full use of avariety of technologies.
We believe that it will become more important to create anenvironment that nurtures the “wisdom” - the assets of each
employee, makes it easier to share that wisdom throughout theGroup, and engages society as a whole with a “sense of creating
together.”Society

NIPPON KOEI GROUP

Society’s needs areconstantly evolving

Commercialize solutions
for social issues
Changes to meet new needs

Integrated Capabilities
Demonstrating integrated
capabilities based on our humanresources and technologies

Human Technology
Resources

Management Base Materiality
5. Enhancement of governance
6. Work environment where human rights arerespected and job satisfaction is high
7. Human resource development and technicaldevelopment

Continue to provide solutions through the accumulation of“wisdom” represented by our technologies

Materiality and Related SDGs
Materiality

Business activities

Awareness of market conditions

Examples of initiatives for each materiality

Development of a safe and reliableinfrastructure● Develop high-quality infrastructures in a wide array of fields● Provide both “hardware” and “software” based
services for disaster prevention and mitigation2

Development of smart societies● Realization of a mobility society through thedevelopment of airports, railroads, and othertransportation hubs/networks● Development of electric power infrastructure inareas with no power supply located overseas

3

Creating attractive cities● Development of smart cities by co-creating
through our Consulting, Urban & Spatial
Development, and Energy businesses

4

Challenge to decarbonization● Provide consulting services for climate change
adaptation measures● Expand renewable energy business in Japan and overseas

5Enhancement of governance● Review of organizational design● Enhance compliance activities

6

Work environment where humanrights are respected and job
satisfaction is high● Further promotion of well-being management

7

Human resource development andtechnical development● Cultivate human resources that embody the Nippon
Koei Group brand through the NKG Global Academy● Create new added value by utilizing DX

1

Management activities

Main related SDGs

Identifying materiality

Against this backdrop, we recognize that the challenge given to
global companies is to respond to these needs by emphasizing
SDGs and ESG perspectives, as well as by making full use of
cutting-edge technologies such as digital technology, which isexperiencing accelerated development. In addition, the current
environment is becoming more and more complex, so we need tochange, not only to provide solutions to individual issues but also toderive optimal solutions to multiple issues. To achieve this, we need
to become engineers who have an image beyond that ofconsultants and transcend preconceived notions by combining DX
with the strengths that the Nippon Koei Group currently possesses:
our “integrated capabilities.”
For example, we recognize that we need project management
skills to be able to work on large projects around the world, and theability to produce new businesses such as subscription-based
businesses and concession business.

Nippon Koei Group response

Rapid urbanization

Railway business and urban space facilities business in Asia

Climate change and lack of resources

Promote water source development, renewable energy, and storage battery businessChanges in demographic structure

Secure production system and strengthening localization

Shift in global economic power

Create private businesses (new businesses)

Technological advancement

Promote collaboration with other industries

Issue Mapping

ImportantMateriality Items

Level of important to the Nippon Koei Group

21 NIPPON KOEI GROUP INTEGRATED REPORT 2022

MegatrendHigh

Level of impact on society

We have integrated and reorganized the content of “issues that have a significant impact on society andare of high importance to the Nippon Koei Group,” and summarized them into seven materiality items:
Four items that contribute through business and three items of management that serve as the foundation
for business continuity.
Later, in order to verify the appropriateness of materiality items from an external perspective, we conductedinterviews with experts. Based on the opinions we received, selected material items were presented to theBoard of Directors for final section.

The global trends of 2030, the target year of our long-term
management strategy, and beyond include the increasing intensityand frequency of disasters due to global climate change; changes
in demographic structure due to the aging of the population indeveloped countries and the population explosion in developing
countries; and rapid urbanization triggered by a lack of resources
and technological advances. Some of these risks are alreadymanifesting themselves in the form of rapid changes in the social
environment, geopolitical risks, and social risks.
In line with this, the need for the creation of a sustainable society
is expected to increase in the future, including the development ofsocial infrastructure that allows people to live safely and securely, thedevelopment of social infrastructure that allows all people to freely
interact and play an active role, and the creation of attractive cities
with a diverse range of people and industries, and the conservationof the global environment by creating a decarbonized society.

High

NIPPON KOEI GROUP INTEGRATED REPORT 2022 22

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Long-Term Management Strategy
Opportunities and Risks Arising from Changes in the External Environment
Nippon Koei Group formulates its long-term management strategy based on an understanding of changes in the external
environment as well as risks and opportunities, and implements initiatives to continue sustainable growth.

Main Changes in the External Environment
Rapid urbanization
The urban population as a percentage of the world's population wasless than 30% in the 1950s and is now projected to rise to 50%. In
2015, there were 22 megacities in the world with populations of 10
million or more, and the world's urban population is expected toincrease by approximately 72% by 2050.
(According to the Population Division of the Department of Economic and Social Affairs of the United
Nations)

Opportunities
Expansion of opportunities for the development ofsmart infrastructure and smart cities● Support for integrated projects by leveraging integrated strengths

Increase in transportation & urban planning fieldprojects● Transportation system development and response to MaaS and

Risks
Increase in multiple large-scale projects● Increasing sophistication and complexity of project management

and quality issues

Compliance● Violation of related laws and regulations in Japan and overseas

and occurrence of serious accidents

TOD utilization

Climate change and lack of resources

Creation of businesses related to climate change

Climate change and lack of resources will have an increasingly
severe impact on the economy with energy demand and water
intake projected to increase by 50% and 40%, respectively, by
2030*.
There are concerns that climate change will cause frequent extreme
weather events and rising sea levels that will make agriculture andother activities using traditional methods difficult in some areas.

● Increased demand for decarbonization and carbon neutrality and* “Global Trends 2030: Alternative Worlds”, US National Intelligence Council

an increase in projects that can take advantage of renewableenergy-related technologies and know-how cultivated to date

Large-scale natural disasters measures● Increased disaster prevention and mitigation measures to cope

Increased conflicts and political tensions overresources● Temporary suspension of projects and supply chain disruptions

Business continuity● Insufficient preparation for large-scale natural disasters

with disasters caused by climate change

Related Initiatives● Expansion of Railways operations in Asia
● Provision of one-stop solutions by integrating the Group's fields ofexpertise● Expansion of Urban & Spatial Development Business● Acquisition of project management/construction management

technology● Strengthening of internal control systems including those at eachGroup companies● Proactively respond to projects that contribute to climate change

countermeasures (transportation infrastructure development,
environmental conservation, renewable energy-related projects,
etc.)● Proactive response to disaster prevention/mitigation, infrastructure
maintenance and management (aging countermeasures), andother disaster countermeasure projects● Acquisition of new energy technologies and promotion of storage
battery business

Creation of projects related to energy and resource
shortages● Increased consulting needs for resource conservation, circular

economy, agricultural reform, and food value chain

Changes in demographic structure

Improvement of productivity through work style reform

Shortage of workers

Changes in demographic structure will vary widely from country tocountry with concerns that rapid aging in some countries will put
pressure on the labor force as it will comprise a smaller portion of
the total population.
On the other hand, growing countries are expected to see thelargest labor force and consumer markets ever.

● Pursuit of optimal work styles including telework● Improvement of business efficiency and productivity through the● Amount of human resources with expertise for securing anduse of IT tools

Expansion of urban revitalization projects and publicprivate partnerships● Increase in compact city planning that consolidates urban

functions to cope with declining/aging populations● Expansion of concessions, PPP/PFI projects, etc.

training workers is insufficient● Loss of human resources due to overwork and harassment● Loss of labor productivity and exodus of human resources● Improvement of working environment by maximizing the use of AI

and ICT● Full-scale expansion into the business management field● Establishment of NKG Global Academy to develop world-classhuman resources throughout the Group● Operation of a regional engineer system to enable overseas

Partner companies● Insufficient securing of partner companies● Decline in productivity and quality in the Group, including partnercompanies

human resources to be active in third countries● Actively recruit new employees and strengthen the post-

employment training system● Regular labor monitoring

Local subsidiary business expansion● Increase in projects and workers in emerging countries

Shift in global economic power

Growth and expansion of scale in emerging markets

Changes in competitive environment

Emerging economies such as the BRICs, which have provided large
amounts of labor and production functions in the past, have begun
to shift to a consumption-based economy and are now exporting
capital, human resources, and innovative technologies, which ischanging the flow of capital.
As emerging markets grow and expand in size, connections throughtrade and investment are being created at a fast pace among
emerging economies.

● Expansion into emerging markets by leveraging Nippon Koei's● Declining competitiveness in mature markets, intensifying

operational know-how

Local subsidiary business expansion● Increase of projects in emerging countries, development of young

workforce, and maintenance of diversity

competition with competitors possessing different attributes thanpreviously seen
● Delayed adaptation of own brand and positioning

Group governance● Fraud risk and inappropriate behavior, lack of synergy from M&A

Create private businesses (new businesses)alliances● New customer development and business creation

Technological advancement

Business creation utilizing DX

Increase in cyber attacks

Breakthroughs in the field of technology and cutting-edge
technologies in other R&D areas will increase the likelihood ofcommercialization and provide increased opportunities for new
investment.

● Expansion of the utilization of BIM/CIM, 3D models, big data, etc.

● Leakage of confidential information such as customer information

Expansion of alliance opportunities● Delays in project progress due to large-scale failuresand our confidential information● Promotion of collaboration beyond industry and regionalboundaries

23 NIPPON KOEI GROUP INTEGRATED REPORT 2022

● Support for autonomous management of regions promoting

matrix management● Diversification of markets (business areas and regions) andcustomers (especially private-sector customers)● Active promotion of local human resources● Careful selection of new investment targets and strengthening ofmonitoring of existing businesses in which we have invested● Transition to a pure holding company to improve management

efficiency, strengthen governance, and realize coexistence ofdiversity● Establishment of NKG Global Academy to develop world-classhuman resources throughout the Group● Realization of DX● Promotion of both “offensive” DX (providing added value throughthe use of BIM/CIM, 3D models, big data, etc.) and “defensive”
DX (improving productivity and business efficiency throughin-house DX)● Acceleration of needs-driven technology development

NIPPON KOEI GROUP INTEGRATED REPORT 2022 24

Introduction

Concept behind our Longterm Management Strategy

Working together
toward a future
without boundaries

In order to respond to increasingly complex social issues and accelerating innovation,
it is necessary not only to enhance the power of each employee and mobilize internal
capabilities but also to collaborate with external partners who possess advanced
technologies and unique know-how and to work together with local people to solve
problems. The concept that emerged from this is “Working together”. Within the Nippon
Koei Group, each company will use its own discretion to grow by making the most of its
own individuality, wisdom, and technologies. We will implement measures with the aim of
becoming a Group that is an aggregate of such companies. Furthermore, we will aim tocreate and develop new strengths together with new colleagues.

In our Long-term Management Strategy, we have positioned “Consulting,” “Urban & Spacial Development,” and “Energy” as the three corebusinesses of the Group and are aiming for their further growth. To promote autonomy and collaboration, we are transitioning to a new groupmanagement structure. By further strengthening group governance and deepening group management from a medium- to long-term perspective,
we will further ensure future growth.

1

Operating profit

Operating Margin

ROE¥250 billion¥25 billion

10%

15%

Long-term Growth Graph and Positioning of the Medium-term Management Plan
With our long-term management strategy, we aim to increase revenue by approximately 1.7x through sustained growth in our three main businesses and growththrough new businesses, and to increase revenue in overseas markets from approximately one-third of the current level to approximately half, thereby making aleap forward to become a global and highly profitable Group.
In order to achieve this, we are establishing Medium-term Management Plans that span over three-year steps.
billion
The three-year period from the fiscal year ended June 2022 to the fiscal year ending June 2024, which is the firststep, is positioned as a “period of change” to solidify the foundation for achieving the plan. This is the Mediumterm Management Plan “Building Resilience 2024” which we have established and are promoting.
New Business
Expansion

By maximizing and integrating the technologies developed by eachof the three domains, we will make a full-scale entry into the business
management field, including infrastructure management, urban
management, the energy business, and data business.

¥117.8 billion

FYE June 2022

FYE June 2025

3rd

Step

Step

Continuous Growthof Our Three Core
Business Segments

FYE June 2027

FYE June 2030

¥202.0 billion

Composition ratios of Net Sales for FYE June 2030

Overseas Sales Ratio■ Consulting Business

Overseas Sales Ratio
Approximately 50%
Revenue

Revenue¥117.8 billion¥250.0 billion■ Consulting Business

80.0

140.0

■ Urban & Spatial Development Business 20.2

■ Urban & Spatial Development Business 65.0

■ Energy Business■ Energy Business

16.6

45.0

Implementation of matrix management based on bothbusiness and geographic regions
We will realize a matrix management system that operates andmanages the businesses of our three domains and the businesses ofeach region.
The Company will address global and regional social issues as wellas propose optimal solutions to diverse needs with a sense ofurgency.

Build a one-stop system through collaboration withother business segments

Business strategy by segment
Consulting Business

2030 Revenue Target¥140 billion

Becoming a world-class consulting firm handling everything from consulting to management

Market strategy: In the Japanese market, we aim to expand into the private sector and management field with a focus on public works projects. In theinternational market, we aim for non-ODA-oriented growth at Group companies with a focus on Japanese ODA projects. In regard to regions, we will promoteentry into new market areas (Middle East, North America, etc.) while securing stable earnings in Asia as a region of particular importance.

Matrix management target areas

Through seamless integration and collaboration without segmenting
by region or company, we aim to create a business structure that can
provide a one-stop shop for services in each domain across theboard.

2ndComposition ratios of Net Sales for FYE June 2021

36.1%

Promote autonomy and collaboration and build a one-stop system

Group companies formed by business domain and region will
manage autonomously while building an organization with a strong
centripetal force based on the mission, technology, and governance of
the Nippon Koei Group.
We will improve the profitability of each business, expedite decisionmaking, strengthen our risk structure, and build a flexible and robust
governance system.

+¥48.0 billion

Approx. ¥155.0 billion

Step

In order to respond to a wide range of social needs, we will
establish a structure based on three business domains: Consulting,
Urban & Spatial Development, and Energy. Through seamlessintegration and collaboration without segmenting by region orcompany, we aim to create a business structure that can provide a
one-stop shop for services in each domain across the board.

Transition to a pure holding company

Status of the Company

Revenue

1stFull-scale expansion into the business management field

2

Review of Operations

Quantivative targets for FYE June 2030

Reorganization of business segments

New development of three business domains

Co-creation Measure

Sustainability/ESG¥250.0Three Long-term Management Strategy co-creation measures

Co-creation Measure

Strategy

Europe, Central Asia, Middle East,and Northern Africa

Technology strategy: Accelerate the development of next-generation core technologies and needs-driven technology.
Human resources/organizational strategy: We will develop hybrid human resources who can play an active role both in Japan and overseas based on flexible
responses to changes in the market environment and employee work-life balance. At our companies overseas, we will promote the training of regional engineersthat can be active in third countries.

South
Asia

Americas

Japan
Southeast
Asia

Urban & Spatial
Development
Business

2030 Revenue Target¥65 billion

Comprehensive operations in urban land development, public-private partnerships for urban and regional revitalization,
smart city development, etc.

Sub-SaharanAfricaCo-creation Measure3

Establish the Nippon Koei brand and Nippon Koei Group quality

Developing world-class human resources incoordination with our technology strategy
Human resources are the most important management resource of
the Nippon Koei Group. In addition to expanding educational
opportunities and programs that are closely aligned with ourtechnology strategy, we will actively hire local human resources andpromote diversity at our bases in each country to develop excellent
human resources.

Realization of digital transformation (DX)We will provide optimal solutions using DX technology. The
Company will develop promising technologies in-house as well as
through alliances with external companies, and apply them to ourbusinesses.

25 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NKG Global Academy
By establishing the NKG Global Academy to cultivate world-classhuman resources throughout the Group, we will foster humanresources who embody the Nippon Koei brand at each of our basesin various countries where we do business.

Market strategy: In the Japanese market, we will focus on architecture, urban redevelopment, public-private partnerships, smart cities, etc. Overseas, we will
actively promote collaboration and alliances with BDP and Nippon Koei Urban Space for large-scale development around transportation hubs in Asia and urban
development and redevelopment in Europe, the United States, and Oceania.
Technology strategy: We aim to utilize BIM and Smallworld (an integrated tool for map information and asset management) to use Nippon Koei Urban Space's
technologies overseas.
Human resources/organizational strategy: We will address environmental improvement and human resources exchange to improve technological capabilities
within the segment, and establish a comprehensive production organization for urban redevelopment.

Energy Business

2030 Revenue Target¥45 billion

Providing one-stop services for power systems associated with stable energy supply

Market strategy: In addition to developing and operating new businesses in line with the deregulation of electric power, we will focus on the international
standardization and sophistication of our core products. Overseas, Nippon Koei plans to establish its energy management business in Europe. In addition, we will
promote the development and operation of microgrids, smart city, and renewable energy power generation businesses in Asia.
Technology strategy: We will improve the performance of our main products, strengthen our competitiveness by reducing costs, and develop systems that
support DX. In addition, we will develop one-stop solutions integrating core technologies with storage battery and aggregation technologies.
Human resources/organizational strategy: We will build a base for strengthening the production structure of manufacturing divisions, building supply chains,and promoting exchanges and collaboration between human resources and departments to provide one-stop solutions.
NIPPON KOEI GROUP INTEGRATED REPORT 2022 26

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Medium-Term Management Plan
Building Resilience 2024

FYE June 2024 Numerical Targets (IFRS)

Based on our Long-term Management Strategy, we have formulated "Building Resilience 2023," a medium-term management
plan to strengthen the foundation for the co-creation of a sustainable future over a three-year period, keeping in mind ouraspirations for the year 2030.
While maintaining/improving business performance, we plan to make investments for medium- and long-term growth, which
will lead to the future development of our Group.

Revenue

Operating profit

Operating Margin

ROE¥155 billion¥11.5 billion

7%9%Expected Progress● Revenue will grow by approximately 10% over the next three years.
● We anticipate that the operating margin for the fiscal year ending June 2023 will exceed the level expected for the final year of the Medium-termManagement Plan due to special circumstances in the energy sector.

Three Measures for Strengthening the Company● Operating profit will grow more than 10% growth annually unless impacted by special circumstances.

Measure2

Establish a group management structure thatrealizes matrix management of business andregions3

Establish the Nippon Koei brand andNippon Koei Group quality

Japan
Southeast Asia
South Asia
Sub-Saharan Africa
Europe, Central Asia, Middle East, and Northern Africa
Americas

Operating profit (Billions of yen)/Operating margin (%)

Revenue (Billions of yen)Consulting

EnergyPromote business based on the independenceof our three businesses

Consulting

Measure1

Regional Axis

MeasureUrban & Spatial Development

Business Axis
Urban & Spatial Development

EnergyConsulting
Operating Margin

Other

10

130.6
117.8

1

Key initiatives

Materiality● Advancement and global expansion of disaster prevention/mitigation
technologies● Full-scale expansion into the management field

M1. Development of a safe and reliable infrastructure● Expansion of transportation related businesses● Creation of smart city projects with a focus on decarbonization, safety, and security

M2. Development of smart societies● Realization of one-stop services for urban (re)development projects● Expansion of BDP market● Full-scale development into urban management field

M3. Creating attractive cities● Promotion of services that contribute to decarbonization● Establish foundation for power generation and energy management business● Strengthen manufacturing of core products and develop new products● Provide one-stop solutions utilizing diversified and diverse technologies

M4. Challenge to decarbonization

Measure2

5

3● DX Promotion● Establishment of the NKG Global Academy

27 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Materiality
M7. Human resource development and technical development

5.0

24/6
Medium-term Plan

21/6
Results

22/6
Results

23/6
Plan

24/6
Medium-term Plan

2

Measure3

Initiatives carried out in the fiscal year
ending June 2023 (second year)●Sales expanded due to strong progress in large overseas
projects. Started acquiring technology to expand businessareas and laying the foundation for new services●Develop new services using new technologies andpromote business expansion utilizing our co-creation
partners

Urban & Spatial
Development Business●BDP and Quadrangle made good progress on their projects.
Implemented organizational integration with the aim of
expanding the Japanese market●Strengthen integrated operations within the segment topromote collaborative order acquisition. Entry into theNorth American market by BDP

Energy Business●Implemented measures to strengthen the production
capacity of our existing Power Engineering business.
Started construction of energy-related projects in
Europe●Establish a foundation for improving production
efficiency and quality of core products. Implement
specific initiatives to respond to changes in theJapanese energy market

Organizational Strategy●Examined the organizational restructuring execution
scheme and prepared for the transition to a holding
company structure●Enhanced network infrastructure and improved
information security measures●Establishment of regulations and various reorganization proceduresfor HD, operating companies, and business management companies●Formulate policies for capital structure and shareholder returns,
and strengthen accounting functions for Group companies●Formulate and promote strategies for addressing
climate change issues and enhance our response tohuman rights issues

Business Strategy●Continued examination of one-stop marketing system
and regional control●Nippon Koei has not continuously examined/collaborated in developing new markets●Establish basic policies on regional management andcreate a management system●Implement measures to promote orders for domestic
strategic projects, formulate projects led by regions,and promote digital marketing●Make proactive use of business incubation functions

Human Resources
Strategy●Changed the position structure and qualifications for
professional positions●Responded to telework issues●Set numerical targets for 2030 for the ratio of female,non-Japanese and mid-career hires in managerial positions●Promote a telework campaign and use of satellite
offices●Increase the ratio of female managers and promote theemployment of people with disabilities

Human Resources/
Technology Strategy●Planned the overall structure of the NKG Global Academy●Developed technology strategy and implemented ninetechnology measure themes●Developed advanced technologies including digital twin
technology●Implementation of smart city business andestablishment of marketing system●Examine professional occupations (expand number ofpublic qualifications)●Digital business promotion, digital technology
development, productivity innovation, and DX humanresource development●Create the NKG Global Academy based on its basic design●Conduct career development that is linked withexternal conditions

MeasureWith our technology strategy, we will grow into a pioneering company that realizes a sustainable society by creating innovativevalue centered on DX. Using our human resources strategy, we will enhance our knowledge management and talent management
systems, which we have built up to date, and establish the NKG Global Academy, a human resources development system.

10.0

Consulting Business

Establish the Nippon Koei brand and Nippon Koei Group quality

Key initiatives

23/6
Plan

Materiality

M6. Work environment where human rights are respected and job
satisfaction is highMeasure22/6
Results

Review of the results for the fiscal year ended June 2022 (first year)

We will strengthen our regional axis, which is the cornerstone of the Group's management structure to realize matrix managementof business and regions.

● Work style reform (promotion of well-being management)

7.4

First-year Results and Initiatives Carried Out in the Second Year1

M5. Enhancement of governance

7.8

-5
21/6
Results

Establish a group management structure that realizes matrix management of business and regions

Key initiatives

6.9

0

0

Measure● Establishment of a pure holding company and governance structure to realize
matrix management● Establishment of regional management structure and support for autonomous
regional management● Realization of one-stop services

15.0

9.0

6.0

We aim to promote independent businesses through three strengthened domains ( ● Consulting Business,● Urban & Spatial Development Business, and ● Energy Business).

11.5

7.1

100

Promote business based on the independence of our three businesses

Other

20.0
11.3

155.0
145.0

150

Strengthening business and regional axes toestablish brand quality throughout theorganization

Energy

15

200

50

MeasureUrban & Spatial Development

NIPPON KOEI GROUP INTEGRATED REPORT 2022 28

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Financial Capital Strategy

We aim to expand andstrengthen our businessthrough aggressive growthinvestments to achievesustainable earnings
growth and shareholder
returns.

In addition, as natural disasters are becoming severer and morefinancial soundness, we have set a target of maintaining an equity

frequent in Japan, we are promoting businesses that utilize satellite

ratio of 50%, which becomes 40% or more even during periods ofdata as an undertaking that contributes to national resilience. Since

intensive investment.

it is essential to acquire high-precision satellite data in real time in

The basic objective of our dividend policy is to provide stablethe event of a disaster, we invested in Institute for Q-shu Pioneersdividends and enhance shareholder returns in line with rising profit levels,of Space, Inc., which is running a SAR satellite constellation project,with a target dividend payout ratio of 30% over the medium to long term.

at the end of 2021. We will continue to focus on disaster prevention

In terms of improving the quality of our balance sheet, we are working

and mitigation initiatives with the aim of providing services withto sustainably increase ROE by improving asset efficiency. By

greater accuracy than ever before.

implementing the growth strategy formulated in the Medium-term

In the Urban & Spatial Development Business, Nippon Koei isManagement Plan, we aim to raise ROE to the 9% level in FYE June

participating in concessions (management rights for public facilities,

2024, the final year of the plan, and to boost it to the 15% level over theetc.) of Meiji Park and Hiroshima Central Park in anticipation oflong term. In achieving the ROE target, we will place emphasis onparticipation in urban redevelopment projects in the future. We plan

profitability and plan to raise the operating margin from 6.9% in FYE

to continue to actively consider PPP/PFI projects for public

June 2022 to 7.4% in the final year of the Medium-term Management

infrastructure where we can utilize our strengths.

Plan, and to 10% in the long term. Combining these plans with flexible
share buybacks, we will continue to consider shareholder returns in

Basic objectives for capital andshareholder return

Yasushi Hirusaki
Director and Managing Executive Officer

accordance with conditions in order to improve capital efficiency andachieve an appropriate total return ratio. I would like to show you how
we will put these initiatives together one by one and link them to a cycle

Based on the aforementioned growth strategy, we recognize theof strengthening shareholder returns and investment for further growth.

need to further strengthen our financial strategy as we move
forward with new asset holdings, alliances, M&A, and other

The Group plans to transition to a holding company structure in

investments. Therefore, in our Long-term Management Strategy, we

the fiscal year ending June 2024 as one means of achieving its

are preparing for monitoring using ROIC, etc., further elaboration of

long-term management strategy, which focuses on the fiscal year

fund management, upgrading of the Group's cash management

ending June 2030. Although our organization form will changesystem, and diversification of fund procurement methods according

greatly, we will continue to strengthen our current strategies andto the use of funds. As part of these efforts, we reviewed our

maximize our corporate value on the financial front throughinvestment screening system to strengthen our financial perspective

appropriate and flexible measures tailored to business conditions. I

important period for us to determine the future development policy

from the fiscal year ending June 2023. In addition to returns fromwould like to ask for your support as we look forward to the future

and transform both financially and non-financially, such as balancingof our power and energy businesses. For this reason, we haveinvestees (dividends, loan repayments, and interest expenses),development of our Group.

investment for growth with financial discipline and promoting ESG.

made up-front investments needed to conduct business in fields

Nippon Koei has established a system that enables each businesssuch as energy management in Europe where progress is being

division to conduct independent and autonomous monitoring. We

made in energy mixing and electricity deregulation. By the fiscal

will effectively and efficiently monitor future investment successyear ended June 2022, we made asset-holding investments andthrough qualitative evaluations, such as comparison of forecast andare promoting a grid storage battery project in Belgium and two in

actual results of the income statement and cash flow as well as

The Medium-term Management Plan currently underway spans a

the UK. From the fiscal year ending June 30, 2023, we will finallybalance sheet of the investee, and quantitative evaluations such as

three-year period to strengthen the Group so that it can achieve its

complete the construction of power storage facilities and enter thechanges in the investment environment as evaluation items. We will

long-term management strategy, or in other words, solidify its

phase of generating profits from the energy management businessalso consider selling investment projects based on the periodical

foothold, and is in the phase of aggressively making growthand expanding business to other regions.

reviews. In the fiscal year ending June 2023, we transferred a part

The Nippon Koei Group continues to take on further challenges

Continuing growth investments for asolid foothold

investments to put new businesses on track and expand them. We

As for the Consulting Business, in the summer of 2022 weof our shares in Singapore-based hydropower investment company

expect to invest approximately 32 billion yen over the three years ofconsolidated ASAP Mobility SDN. BHD., a Malaysian railway system

Ironmont Hydro Pte. Ltd., in which we invested in the energy

the Medium-term Management Plan in growth investments,

consulting company, into a subsidiary in order to strengthen thebusiness for the purpose of participating in the creation andincluding new business development and M&A. An example of arailway field, where demand continues to be strong overseas. In theoperation of small and medium-sized hydropower projects in Asia.

business that we are working to diversify is the Energy Business,railway business, construction consultants are mainly responsible forIn this way, we will increase our asset turnover ratio and achieve

which is undergoing a remarkable business transformation. In the

project management, civil engineering-related work and systems

profitable growth while being mindful of financial control andcurrent energy markets in Japan and Asia are in a transitional(signals, rolling stock, electricity, etc., and their integration). By joining

improvement in asset efficiency.

period of changing to new business forms, involving changes such

the ASAP Group, which specializes in railway systems, we believe

Our basic objective regarding capital is to improve capitalas electricity deregulation, promotion of renewable energy use, andthat we will be able to further strengthen our efforts in the railway

efficiency through medium- to long-term growth investment andspread of distributed power sourcing. We consider this to be an

business and establish a superior position as a railway consultant.

raising appropriate capital suitable for such investment. In terms of

29 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 30

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

At a glance
Financial Highlights

Non-financial Highlights

Orders and Revenue

Operating Profitand Operating Margin

Number of Employees

Number of Certified Professional Engineers

As a result of expanding our business domains under the previous long-term management
strategy and reorganizing the portfolio under the current medium-term management plan,
we have continued to grow even in the past few years when there were restrictions on
overseas travel due to the COVID-19 pandemic. * Results until FYE June 2019 with Japanese GAAP

We are also working on measures to improve productivity in order to promote our business efficiently.
In the fiscal year ended June 30, 2022, operating profit reached a record high due tostrong performance by overseas business divisions and improved profits in the energy
business.
* Results until FYE June 2019 with Japanese GAAP

The number of Group employees is increasing due to business expansion. We hire about
150 to 200 new employees every year, including those hired at Group companies in Japan.

The number of the certified professional engineers is increasing year by year due to theenhancement of measures to acquire qualifications such as seminars.

(Millions of yen)

(Millions of yen)Orders

Revenue

160,000

145,000

144,871
133,304
106,023
104,350

Operating Margin

12,00010

11,300131,166 130,674

9
10,0008

9,065

117,859

118,085
108,589

Number of employees (Consolidated)(persons)(%)

140,000

140,000
120,000

Operating proﬁt

108,4417.8
8,000

100,000
80,000

6,000

7,128

6.2
6,561

4.7
5,110

60,000

6
5

5,245

0
19/6

20/6

21/6

22/6

18/6

23/6
(Plan)

19/6

Profit attributable to owners of parent

1,600

15.7

14

14.5

13.8

12

12.9
11.8

3,000

10

2,703

2,750

2,519
2,167

20/6

21/6

22/6

1,000

1

0
18/6

0

23/6
(Plan)ROE (%)The Group is generating stable profits. In the fiscal year ended June 30, 2022, profits
increased due to strong business performance and the effects of the yen depreciation.

2,179

19/6

20/6

21/6

600

4

400

2

200

0

0

22/6

8,000
6,579

6,700

1,362

1,420

1,743
1,466

19/6

20/6

21/6

22/6

Recognition as an Outstanding Health and Productivity
Management Organization (White 500) for four consecutive years
In order to put the Nippon Koei Group's Management Philosophy into practice, we believethat the first priority is the health of employees and their families, both physically andmentally. This is the reason why we promote health management.

6.7
6.0

1

4.6

4,000
3,000

1,727

5.7

4,531
3,318

1,334

1,656

8.0

6,000
4,555

1,621

8.5

8.1
7,000

1,304

18/6

* Source: “Sales ranking of engineering consulting firms,” Nikkei Construction, April 20, 2022

8.8

1,584

1,000
800

10.0

(Millions of yen)

Number of certiﬁed professional engineers (Non-consolidated)

1,200

6

Nippon Koei has established a leading position as a civil engineering consulting firm inJapan that is ranked No. 1 in sales.

(%)

1,400

8

Ranked No. 1 in Sales in Japan’s Civil
Engineering Consulting Industry

We aim to improve capital efficiency through the sale of strategic shareholdings, etc.

*Results until FYE June 2019 with Japanese GAAP

5,000

5,497
4,923

4,000

2

Number of certiﬁed professional engineers (Consolidated)

2,000

16

5,936

5,772

3

2,000

18/6

5,000

(persons)

1,800

6,163
6,000

2,000

4,000

0

Ratio of female employees (Non-consolidated)
(%)
18

4

40,00020,000

Number of employees (Non-consolidated)

7,000

7

6.9

6.0

4.8

* Results until FYE 6/2019 with Japanese GAAP

Ranked No.
in Sales in Japan’s Civil
Engineering Consulting Industry

4.0
3,099
2.0

2,000
1,000

0.0
18/6

0
18/6

19/6

20/6

21/6

22/6

19/6

20/6

21/6

22/6

23/6
(Plan)

23/6(Plan)

Overseas Sales Ratio

Annual Dividend and Dividend Payout Ratio

CO2 Emissions

In the past few years, the overseas sales ratio has been in the high 30s% due to strong
business in Japan and the impact of the COVID-19 pandemic. However, in the fiscal year
ended June 2022, the ratio has increased due to an increase in the utilization of projects
in our overseas business divisions.

The basic objective of our dividend policy is to provide stable dividends and provide
shareholder returns in line with rising profit levels, with a target dividend payout ratio of
30% over the medium to long term. Most recently, the dividend per share increased in linewith the Group’s strong business performance.

CO2 emissions are decreasing due to the promotion of energy-saving activities at offices
and factories and the use of solar power generation at factories.

Energy Consumption* All Nippon Koei Co., Ltd. offices in Japan

Scope 1(%)

Dividend

(Yen)

50

140.00
42.0

41.2
38.3

40

38.4

35.3

36.6

Payout Ratio (%)

125.0036.8

28.6
100.00

25.5

28.1

40

331

35

300

4,060

30

75.00

75.00

75.00
20

60.00

20

3,911

3,958

302

306

3,163

2,500

150

2,000

1,000

0

31 NIPPON KOEI GROUP INTEGRATED REPORT 2022

18/6

19/6

20/6

21/6

22/6

2,000

1,900
1,844

500

0
22/6

2,078

78

5

0.00
21/6

2,155

1,500

99

50
20.00

20/6

2,186

2,020

10

10

19/6

2,200

2,100

200

100

18/6

3,500

250

15
40.00

0

(kL)
2,300

4,000
3,502

25.0
25

75.00

4,500

3,000

30
80.00

(t-CO2)350

125.00120.00

Scope 2(t-CO2)

In addition to curbing energy consumption, we are working to supply 100% renewableelectricity from the hydroelectric power plants that we operate to three of our company
locations (Head Office, R&D Center, and a manufacturing site).

0
18/6

19/6

20/6

21/6

22/6

1,800
18/6

19/6

20/6

21/6

22/6

23/6
(Plan)NIPPON KOEI GROUP INTEGRATED REPORT 2022 32

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Sustainability Management
Approach to Nippon Koei Sustainability

Basic Sustainability Policy

Based on the Management Philosophy, the sustainability of ourGroup comes from developing business strategies to pursue
opportunities in the risk related to environmental and social issues
and proposing solutions for environmental and social issues
through promoting business activities.
Under the “Nippon Koei Group Code of Conduct,” and “Basic
Sustainability Policy,” each and every one of our of employees is
working with a high level of awareness to address environmental andsocial issues toward the development of a sustainable society,aiming to contribute on a global scale by leveraging our businessdomain as a consultant.

The Nippon Koei Group promotes sustainability management inorder to contribute to the development of a sustainable society,based on fair and transparent corporate management that
establishes trust with stakeholders and is guided by values sharedwithin the Group.
We promote the following activities from the perspective ofcontributing to the creation of social value through our businessactivities, in addition to the perspective of responding to the impactof our business activities on society and to social needs from awide range of perspectives.

1993

1996

1998

2015

2022

Established Nippon Koei Basic Policy for the Global
Environment
Established Nippon Koei Action Plan for the Global
Environment
Ten Environmental Principles were established by theConsulting Unit (former name)A new version of the Ten Environmental Principles
established based on the Nippon Koei Basic Policy for
the Global Environment and the Nippon Koei Action Planfor the Global Environment as well as the Ten
Environmental Principles of the Consulting Unit.
Established Basic Sustainability Policy

Sustainability Promotion System
The Nippon Koei Group established the “Sustainability Promotion
Committee” in September 2021 with the aim of further
strengthening its efforts to realize a sustainable society.
As a sub-committee of the Management Council, this Committee
will be responsible for examining important issues and key targets
for sustainability across the entire company and clarifying necessary
implementation strategies, KPIs, and activity procedures. The
Committee is chaired by the Director and Vice President (in chargeof Sustainability), with outside directors as advisors, and thecommittee members are those who are responsible for eachbusiness headquarters, business unit, and committee. Dependingon the topic to be discussed, other parties concerned will attend
the Committee, and outside experts will be invited. The Committee
Chair, advisors, and committee members are appointed by the
President, and sub-members and observers are appointed by theCommittee Chair.

The Committee is responsible for formulating business policies
and approving and deciding on activities related to Group-wide
sustainability risks and opportunities. The Committee’s activities aresupervised by the Board of Directors and matters discussed by theCommittee are regularly submitted and reported to theManagement Council and the Board of Directors. Specific business
operations that contribute to the Sustainable Development Goals(SDGs) will also be considered by the Committee.

Composition of the Sustainability Promotion Committee
Committee
Chair(Officer in charge of Sustainability)
Yoko Ishida
Outside Director

Committee

Each headquarters Director General Managers andMembers

department General Managers (6 persons in total)

Offices

Corporate Planning Dept.

Main Discussions of the Sustainability Promotion
Committee and Future Responses● Establishment of a Sustainability Promotion
Committee and placement of full-time officers

2022

Environmental
Management

Takayasu Tsuyusaki
Director and Vice President

Advisor

Main
Discussions
During FYE Junemanagement in accordance with these principles and contribute to
the creation of a sustainable society through our business.

Basic Approach to the Environment
Nippon Koei established the Ten Environmental Principles striving
to reduce the environmental load and effectively utilize resources
through business and to encourage each employee to think and act
on their own.
In our operations, we will utilize our Quality and Environmental
Management System and contribute to environmental
considerations in accordance with the SDGs, the Sustainable
Development Goals, through our knowledge and technicalcapabilities related to environmental considerations.

Ten Environmental Principles● Consideration and establishment of the Basic
Sustainability Policy● Held study sessions to understand social trends
and to improve the quality of information
disclosure through mutual recognition of issues● Review and enhancement of Sustainability
Promotion System❶ Gain basic understanding.

● Analysis of the Nippon Koei Group’s current
conditions from the perspective of sustainability
management● Realization and deepening of the roadmap andoutputs for promoting sustainability management● Realization and deepening of materiality issues(including the consideration/formulation of KPIproposals)❼ Consider cost effectiveness in relation to environmental❷ Comply with environmental laws and regulations.
❸ Give consideration to the actual status of the natural andsocial environments of the region.
❹ Proactively engage in environmental impact assessment.
❺ Pay attention to the diversity of environmental fields.
❻ Enhance technological capabilities with environmental

considerations as a value added.

Basic Sustainability Policy
Contributing to Society throughOur Business Activities

Environment

Social

We will actively promote the commercialization of solutions for social issues and contribute to the developmentof a sustainable society through business activities that support the development of optimal infrastructure tomeet the needs of the times.

Environmental
conservation

We will strive to create a richer social environment in harmony with the natural and living environments,emphasizing the need to respond to climate change, to make a transition to a resource-recycling society,and biodiversity.

Respect for
Human Rights

Throughout our supply chain, we recognize diversity and address human rights risks based on race, nationality,
gender, ideology, creed, and social status, and strive to avoid complicity in human rights abuses.

Human Resource
Development

We will develop human resources who have the expertise to meet the needs of our clients and who can be
active on a global scale, while maintaining fair and equitable employment relationships that enable our employees
to play an active role in the company.

Work Environment
Improvement

We will support the safety and health of our employees and promote a working environment in which they canfeel comfortable, prosperous, and fulfilled.

Enhancement ofGovernance

We will comply with our corporate governance policies and ensure transparency of management and increasecredibility through enhanced communication with stakeholders.

Conduct Businesswith Integrity

We will comply with laws, regulations, and corporate ethics, including social norms, and conduct fair transactions
with our business partners, respecting each other’s position.

Governance

33 NIPPON KOEI GROUP INTEGRATED REPORT 2022

FutureResponses

considerations.
❽ Propose measures and processes enabling environmental

considerations.
❾ Accumulate, share and communicate knowledge andinformation relating to environmental considerations.
❿ Incorporate environmental considerations into quality

management system.

● Response to TCFD
● Response to human rights issues

Responding to Climate Change
Signatory of the UN Global Compact
In July 2019, Nippon Koei expressed
its support for the United Nations Global
Compact (UNGC) proposed by theUnited Nations. We are also a memberof the Global Compact Network Japan,
which is comprised of Japanesecompanies that have signed the UNGC.
Many of the projects in which we are
involved, such as infrastructure
construction, energy development, and environmental conservationin developing countries, will greatly contribute to the realization of
the Ten Principles of the Global Compact. We will promote

Nippon Koei promotes the modal shift from automobiles torailroads and ships, supports conversion to renewable energy,
supports the efficient use of energy, and provides consulting
services for greenhouse gas reduction from the perspectives ofvarious business fields, such as controlling greenhouse gas
emissions by improving waste treatment technology and supporting
the CDM (Clean Development Mechanism) business. In the Energy
Business, we recognize the importance of both “reducing theenvironmental impact of our own operations” during the equipment
manufacturing process and the construction of substations andpower plants, and “reducing the environmental impact of ourcustomers’ use of our Group products,” promoting initiatives onboth sides. In the area of research and development, we have set“develop businesses responding to climate change” as one of the

NIPPON KOEI GROUP INTEGRATED REPORT 2022 34

Introduction

main technology measures that we are implementing across theentire company, and are for working on the development of related
cutting-edge technology and new businesses. The Company also
works to share and disseminate its technology and expertise widely,such as through the operation of NK-ClimVault, a portal site thatallows users to obtain free future climate forecast information on
rainfall and temperature in major cities.
In response to the Task Force on Climate-related Financial
Disclosures (TCFD), the Sustainability Promotion Committee isanalyzing the impact of climate change on our business andconsidering measures to address the issue. Going forward, we will
promote the appropriate disclosure of climate change-related
information, strengthen governance and business strategies related
to climate change, build further relationships of trust withstakeholders, and aim to sustainably increase corporate value.

Initiatives for Reducing Environmental
Impact In-house
At our head office building located in Chiyoda-ku, Tokyo, we haveincorporated an energy management system developed in-houseand an energy-saving system that uses geothermal heat, based on
the knowledge gained from our core businesses. Fukushima Works,
located in Sukagawa City, Fukushima which has a manufacturing
department, is working on reducing power consumption by
installing solar power generation and introducing storage batteries,
reusing packaging materials, and recycling waste plastic and wastewood.

Energy Consumption
(kl)
2,300

2,186

2,200

2.5
2.0

Decarbonization
1.2

1.2

1.0
0.5
0
2018.62019.62020.62021.62022.6*All Nihon Kohei offices in Japan

Contributing to theEnvironment ThroughBusiness
Quality and Environmental Management
System
Nippon Koei has built and operates a quality and environmental
management system at each business headquarters in compliancewith ISO 9001 and ISO 14001 standards in an active effort to ensure
quality and protect the environment in its business activities.
This quality and environmental management system standardizes
business processes and fosters ongoing improvements by setting
and pursuing quality and environmental objectives as well as
assessing the effectiveness of the system. By operating this system
and responding to quality and environmental risks and opportunities
that affect our business activities, we are working to improve quality
and customer satisfaction and fulfill our social responsibilities
through environmental considerations.

2,020

Bid/contract

Job start

1,844
2018.62019.62020.62021.6

331

302

306

250
150

99
2018.62019.62020.62021.6782022.6

CO2 Emissions (Scope 2)(t-CO2)

5000
4,060

4000

3,911

Job proposal/quality proposal

2022.6(t-CO2)

50

2.1

2,078

CO2 Emissions (Scope 1)
350

2.0

1.8

1.5

Management/operation via intranet system

1,800

Kick-off meeting

Quality goals, implementation
framework, environmental
conservation and other plans

Job review/screening board

Senior engineer and othersupport as well as stronger
internal and external
communication

Compilation of report

Evaluations byverification engineers

Final job verification

Approval of report submission

3,502
3,163

Report on job completion

Job end

Quality assurance

Environmental conservation

Enhancement ofcustomer satisfaction

Social Responsibilities

3000
2018.62019.62020.62021.635 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Status of the Company

Supporting local government collaboration between Japan and developing countries toachieve a decarbonized society

In order to promote the decarbonization of cities in developing
countries, we are engaged in the commissioning of public-private
partnerships to realize decarbonization by sharing Japanese local
governments’ deep experience, know-how, and achievements
related to the formation of decarbonized societies during
collaboration with local governments in developing countries.
As part of this project, we support the formulation of master plansfor overseas cities related to decarbonization, introduce
decarbonization technologies by companies, and support thecommercialization of decarbonization technologies. We also
introduce technologies and products owned by private companies
and support their commercialization in order to formulate concrete
decarbonization projects for cities in developing countries. Since
there are many financial problems associated with commercializationin developing countries, we provide support for commercialization byintroducing subsidy schemes, etc. under the Ministry of the

Waste Treatment

Environment’s Joint Crediting Mechanism (JCM) and providing
guidance on application procedures.
To date, we have implemented several inter-city collaboration
projects, mainly in Southeast Asian countries, with six projects
underway in 2022.

City-to-City Collaboration Achievements (2022)
Municipality in Japan

Foreign Municipality

Osaka City

Ho Chi Minh City, Vietnam

Toyama City

Renca Commune, Santiago, Chile

Osaka City

Eastern Economic Corridor (EEC),
ThailandKawasaki City

Pekanbaru, Indonesia

Fukuoka Prefecture

Hanoi, Vietnam

Sakai City

Ba Ria-Vung Tau Province, Vietnam

Sharing Japan’s knowledge and experience in waste disposal with Ukraine, a nation
which is experiencing waste issues

Since 2018, Nippon Koei has been conducting basic surveys toimprove municipal solid waste management in Ukraine anddispatching experts from JICA to support the improvement of solid
waste management capacity in Ukraine. As part of this work, weare currently holding online seminars (scheduled to be held fourtimes in total) to share Japan’s knowledge and experience indisaster waste management with Ukraine, which is currently
experiencing difficulties in dealing with the large amount of debris(from destroyed buildings, etc.) generated by the Russian invasion.
The first seminar, held in June 2022, was attended byrepresentatives from Ukraine’s then Ministry of Local Governmentand Land Development, Ministry of Environmental Protection andNatural Resources, and city and state governments. From Japan,
speakers included JICA officials, representatives from Nippon Koei,
and officials from the Japan Environmental Sanitation Center andHigashimatsushima City in Miyagi Prefecture, which was severely
damaged in the Great East Japan Earthquake, to deepen mutual

understanding of Japan’s experience and Ukraine’s current
situation and challenges.
Going forward, Nippon Koei will continue to take the lead insupporting the recovery and reconstruction of Ukraine andcontribute to its reconstruction.

Online seminar held in June 2022

Job verification

Client report evaluating
job completion

3,958

Review of Operations(Water (10,000 m3))

2,000
1,900

Sustainability/ESG

Project Information

Water Use

2,155

2,100

Strategy2022.6

Clean Energy

Reducing environmental impact and waste in the construction of renewable energy facilities

At the Fujiwara Power Station (Minakami-cho, Tone-gun, Gunma
Prefecture), we were responsible for the foundation of the water
turbine room, retaining walls, construction, paving and external
structures within the power station, and for the foundation of thesubstation. The project is for the renovation of the hydroelectric
power plant (22,200 kW output), which began operation in 1956,
as a “power generation facility certified for renewable energy power
generation projects based on the feed-in tariff system.” In the past,when dismantling the foundation of a water turbine generator, thicksteel materials such as water turbines and suction pipes buried inconcrete were exposed and removed by gas cutting while theconcrete was being dismantled. In this project, the burden on theenvironment was reduced by adopting a method of carrying out
the buried steel material with the cut blocks using an overheadcrane. In addition, waterless cutting, which does not use water

when cutting concrete, reduced waste (sludge water produced
during cutting).

Removing a concrete section cut using a wire saw

NIPPON KOEI GROUP INTEGRATED REPORT 2022 36

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Society
In addition to building a solid technological foundation, we aremaking intensive human resource investments in the following
points as specific measures.

Human Resource
Development

The Nippon Koei Group considers its human resources as its
greatest management asset and the source of value creation. The
Group provides a full range of training and seminar programs
designed so each employee is fully aware of their role as aprofessional, feels their own growth, freely demonstrates theirabilities, and feels a sense of purpose in their work. In addition, thepersonnel structure and training systems are formulated to support
continuing skill development.

Training, Programs, and Systems for Human Resourceand Skill Development
Training and Seminars● New employee introductory● Harassment prevention training

training● Third-year training● Life planning seminars● Manager training● Technical development training /*1

TD follow-up training● Professional engineer (secondary)● Training before appointment

exam preparation seminar

to managerial positions● Skill advancement courses,

Programs

Measures to Improve Employee
Engagement

Job Rotation System

Human Resource Policies and BasicApproach to Human Resources● Mid-level employee training

Various Systems

etc.

Systems● Personnel Exchange Multiseed● NKG E-learning System

Program*2● Distance education● Financial incentives for paper
submissions and lecture attendance● Financial incentives forcertification attainmentetc.

● Career Path Planning System● CPD Activity Recording Systemetc.

*1 Technical Development: A Nippon Koei training program for employees to define theircareer vision to serve as a guide for developing technical expertise to achieve their vision.
*2 Abbreviation of Multi Seed Program, which is a system of personnel exchange that assign
employees to a different department than the originating department for a set duration todevelop engineers.

Human Resources Strategy
Our human resources strategy aims to develop world-classhuman resources in 2030. In other words, our goal is to develop
human resources that embody the Nippon Koei Group brand who“Think globally, Act locally.”
In the medium-term management plan NKG Building Resilience
2024, “establishing the Nippon Koei Group brand and quality” isincluded as a resilience measure. “NKG Quality” is the technology
and deliverables that have created a high level of customer
satisfaction, and “NKG Brand” is the trust relationships withcountries around the world built through overseas ODA projects
and advanced disaster prevention and mitigation technology
cultivated through domestic natural disaster response, which arerooted in the local community. For the Group, it is human resources
themselves that create the brands and quality, so we recognize that“strengthening our human resources” is the most importantmanagement issue.

Training
measure ❶Domestic and overseas hybrid human resource
development

Training
measure ❷Regional engineer development

Training
measure ❸Development of human resources capable ofconducting cross-segment business

Human Resource Development
Programs
In order for the Nippon Koei Group to continue to exist as agroup of professionals capable of solving the issues of the times
and issues that regions face who are committed to society, we
believe that it is important for our employees to work tirelessly andfor the company to create an environment that encourages them todo so. To achieve this, we established a system for careerdevelopment and a structure for human resource development
based on the career vision formulated in 2001. In addition, it is also
important for each and every employee to be aware of the role heor she should play and to act with a sense of unity throughout theGroup. In order to achieve this goal, we indicate the following threeroles as being necessary: Technical Manager (TM), General
Manager (GM) and Project Manager (PM). We offer a variety of
training programs to promote knowledge and learning for each ofthem.
Furthermore, in order to smoothly promote work as professionals,
we believe that communication skills, specialized technical skills,social skills, and management skills that integrate these abilities are
essential. To improve these skills, we will enhance our effective
training programs.

NKG Global Academy
As part of our Medium-term Management Plan, we aim toestablish the “NKG Global Academy,” a platform which will enableengineers in the Group around the world to mutually exchange andintegrate technical information We are currently developing andexpanding the content in stages with the aim of establishing it inJune 2024. In 2030, it will be made available not only to the Groupbut also to general companies, etc. In the future, we plan to evolve
it into a place where people from all over the world can gather andlearn.
We are building a platform for co-creation with the aim of raising
the level of all Group employees and developing top-class humanresources, positioning it as a human resource development
institution for the growth of all Group employees.

We have established the Multi Seed Program (MSP) under whichyoung engineers are systematically transferred to otherdepartments to gain experience in different technologies,
businesses, and occupations, thereby developing engineers who
can accept and utilize diversity in technology, knowledge, working
environment, values, etc. The aim of this program is to develop
engineers who are not biased toward a single specialization and arecapable of responding to future changes in the businessenvironment, and to expand our human network by conducting awide range of personnel exchanges on an ongoing basis.
In regard to administrative employees, we regularly conduct job
rotations, especially for younger employees, because they are
required to demonstrate a high level of expertise in accounting,finance, legal affairs, human resources, sales, and other areas tosupport business operations in an appropriate, accurate, andefficient manner, and to carry out business management of theentire company, departments, projects, subsidiaries, etc., from amanagement perspective.

Career Development Support System
We have established a system to help employees who seek toenhance their own professional development. The purpose of the“Financial incentives for certification attainment” program is toencourage employees to acquire official qualifications necessary forbusiness strategy as well as to promote the development of
employees’ skills and self-improvement.
Under the educational support system for self-improvement, we
subsidize tuition fees for employees who have completed courses(correspondence courses, etc.) approved by the company.
In addition, we encourage employees to submit papers and givelectures at academic conferences, and provide the “Financial
incentives for paper submissions and lecture attendance” program
for the purpose of developing skills and forming external networks.

Support System for Obtaining Professional
Engineer Certification
Certified Professional Engineer is the highest national qualificationfor engineering employees in Japan and it is essential for ourbusiness strategy that our engineers have this qualification.
Therefore, we supports employees seeking to become certified
professional engineers by offering annual preparation seminars forthe certification examinations.
Programs are designed to build the confidence of individuals
preparing for the examination through correcting and advising
about written submissions, workshops and study sessions on test
preparation and how to write papers, practice questions andanswers, and mock interviews for the oral examination. The
Company also offers financial incentives and a support system forthe cost of examinations to reward employees that earn
certification.

We believes that it is important for all employees to share thevision and mission of the Nippon Koei Group and operate its
business with a sense of unity.
In addition, smooth internal communications, especially thebuilding of good human relationships between superiors andsubordinates, is directly linked to the improvement of employee
engagement. For newly appointed managers, training is provided
from the perspective of how to enhance team strength while
utilizing the individuality and strengths of their subordinates.
In addition, we believe that it is important to properly evaluateabilities and achievements in order to improve employee motivation.
Therefore, we conduct personnel evaluations once a year linked to thetarget management system. In order to ensure the proper operation ofthis personnel evaluation, we conduct evaluator training for newly
appointed managers, and in order to ensure the fairness of evaluation
results, we hold an evaluation committee in which multiple members
are appointed and established by director generals of different
headquarters to verify the evaluation from an objective perspective.
In addition to these measures prepared by the company, we
conduct a career questionnaire once a year for all employees(excluding part-time and contract employees) as an opportunity for
employees to present us with their own career aspirations andrequests. The results are used for job rotation purposes and to
improve the work environment.

Key Human Resource Data
2019

2020

2021

2022

Number of Certified
Professional Engineers(Group total, number of
persons)

1,621

1,656

1,727

1,743

Number of Certified
Professional Engineers(Non-consolidated,
number of persons)

1,334

1,362

1,420

1,466

Number of New
Employees(Domestic Group total,
number of persons)

173

187

206

205

Ratio of Female Employees
Among New Employees(Domestic Group total,in percent)

21.4

22.5

29.1

37.1

Average Number of Yearsof Employment(Non-consolidated, years)

14.4

13.9

13.6

13.4

Employee Turnover Rate
(Non-consolidated, in percent)

2.3

2.1

1.8

2.4

Training Cost per Person
per Month(Non-consolidated, in JPY)

3,502

2,646

1,187

2,903

Turnover Rate of New Graduate Hires Within 3 Years*
Month/
Year of Entry
Turnover Rate
Within 3 Years

April 2016 April 2017 April 2018 April 2019

10.3%

7.0%

7.9%

7.6%

* For example, the figure indicates the ratio of new graduate hires who joined Nippon Koei in
April 2019 that have left the company within three years (by the end of March 2022).

37 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 38

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

SocietyWork Style Reform

Work-Life Balance Initiatives

Supporting Employee Health

The Group has established a Work-Life Balance Promoting
Committee under the Management Council to pursue a balanced
work style that emphasizes the quality of labor so that each
employee can work with a sense of satisfaction and fulfillment andfulfill their work responsibilities. Based on the existing themes of“work style reform” and “productivity improvement,” the Nippon
Koei Group is working faster than other companies in the industry
on work style reform with a focus on establishing systems andenvironments that make optional and diverse work styles possible
which place emphasis on work quality. As a response to the
Covid-19 pandemic that we currently face, while using thedecisions of the government and local governments as a standard,
we have set an office attending rate for each employee according
to the status of the pandemic since March 2020 to protect theirsafety and health, and we continue to use a combination of
telework and telecommuting systems. In the Tokyo metropolitanarea, we have expanded the options for remote work by
successively opening satellite offices in consideration of employees
who have difficulty working from home due to their homeenvironment and other factors.
At the Head Office, by flexibly selecting and utilizing locations
suited for work content, such as spaces for online meetings, offices
for focused work, etc., we have established a work environmentthat encourages collaboration and improved productivity. In
addition, in order to accelerate in-house DX, the DX Transformation
Department is working to improve operational efficiency through theuse of AI and RPA, and many good examples of how DX has
helped have already emerged. The systems such as flextime andtelework that have been implemented in response to the “workstyle reform” and the corresponding expansion of the IT
infrastructure environment, such as the shift to cloud computing,digitization of various internal applications (move to a paperless
approach), and the establishment of online meetings, have not only
promoted diverse work styles but also increased productivity.

Nippon Koei acquired the Kurimin andPlatinum Kurumin* Certification from the
Ministry of Health, Labour and Welfare as
a company with a high-standard of
support for child raising in accordancewith the Act on Advancement of Measures
to Support Raising Next-Generation.
Nippon Koei build an environment where human resources may
have diverse work styles in an effort to foster a better work climate.

Systems to Support Work FriendlinessNippon Koei has put in place a wide range of programs as a way
to support employees at different stages of life whether having or
raising children or caring for sick or elderly family. In addition tocomplying with legal standards, we also add our own preferential
treatment and systems to our efforts to enhance the work-lifebalance of our employees.

The Nippon Koei Group believes that in order to put into
practice our management philosophy of “Act with integrity
and contribute to society through technology andengineering,” our employees and their families must be
healthy, both physically and mentally.
By maintaining and promoting the health of employees andtheir families, and creating a vibrant work environment andhighly productive work styles that respect diversity, we willrealize a favorable work-life balance of employees as wellas the well-being of the Group and contribute to thedevelopment of a sustainable society through our business.

Employees with children under the age of three may take up to
18 months of childcare leave.

Childcare Leave Utilization RateFYE June 19

FYE June 20

FYE June 21

FYE June 22

Total

23.6%

31.0%

38.7%

39.0%

(Male)

10.2%

14.5%

17.2%

28.7%

(Female)

84.6%

87.5%

111.8%

122.2%

Employees with children up to elementary school age are entitled
to take sick/injured child care leave in addition to annual paid leave.

regulate them
● Digitization of various internal applications(paperless)● Use smartphones for extension calls
Improve officesystem efficiency

Sick/injured Childcare Leave Utilization RateFYE June 19
25.2%

FYE June 20

FYE June 21

30.4%

23.1%

FYE June 22
25.6%

Employees who need to care for a family member can takenursing care leave in addition to annual paid leave.

Under the leadership of the Officer in charge of HealthManagement (Director and Vice President), we are implementing
measures focused on the prevention of severe illnesses based on
the premise that 100% of employees receive health checkups (allemployees, including contract employees and part-time employees
who are obliged to enroll in social insurance). We have establisheda wide range of preventive measures, such as annual healthcheckups, including gynecological checkups and complete physicalexaminations for all employees over 35 years of age, as well asrecommendations for reexaminations by full-time industrial
physicians for employees with findings and interviews with industrial
physicians for those at high risk.

0

We identify health issues, evaluate and improve the results basedon the annual plan we have formulated, and make improvements
every year.

PLAN Set goals and tasks

DO Implement measures● Analyze health checkup results, etc.

● Implement various healthand identify issues● Formulate a one-year plan andreport to the Management Council● Obtain data through user

measuresquestionnaires, etc.

Nursing Care Leave Utilization Rate

1.2%
Improvemanagement
work efficiency
Improveefficiency of
production
activitiesFYE June 20
1.6%

FYE June 21
0.9%

0.5%

91.0

89.9

89.5
National average
78.0%

2020.62021.62022.6* National Average Data, Source: Ministry of Health, Labour and Welfare (July 26, 2017)

Labor Safety and Health Initiatives
Nippon Koei places top priority on safety in every aspect ofcorporate activities in the Group Code of Conduct and complies
with all occupational health and safety laws, regulations and internal
rules. Our basic objective is to prevent occupational accidents andillnesses and ensure the safety of all people from our corporate
officers and employees to partner companies and everyone else in
the value chain.
Our human resources are the foundation of Nippon Koei. The
entire Group not only strives to engage in health management
initiatives but also promotes various health measures unifying thecompany, employees and health insurance association to help all of
our human resources perform to the best of their abilities.
In the event an occupational accident or illness occurs, we have
put in place a crisis management system to respond quickly whileworking to prevent recurrence by disclosing the necessary
information both inside and outside of the company.

Number of Occupational Accidents

FYE June 22● Identify issues for the next

fiscal year and consider
countermeasures● Digitization of purchase management/contract

management

Percentage of Employees That Received Stress Checks

50

Health Management PDCA Cycle

Nursing Care Leave

FYE June 19

Caring about the mental and physical health as well as the safetyof our employees, we conduct annual stress checks for all
employees and the ratio of employees participating in stress checks
is 90%, which is higher than the national average. In addition, we
have introduced an EAP (Employee Support Program) counselingservice provided by certified psychologists to create an environment
where employees can easily consult with them.

Employee Health Management Support● Introduce telework, free address system, andsatellite offices

Mental Health Care

(%)
100

Sick/Injured Childcare Leave System● Improve the efficiency of online meetings andNippon Koei was certified as a 2022 “White 500” Outstanding
Health and Productivity Management Organization, continuing its
status for four years in a row.

Nippon Koei Group Health Declaration

Childcare Leave● Initiatives for work style reform and improving

productivity

In order for our human resources, the foundation of the Group, tofully demonstrate their abilities, we have established the Group
Health Declaration and are working on health management thatconsiders employee health from a management perspective andstrategically promotes various measures to improve employee
health.

External Evaluation

ACTION Make improvements● Quantitatively analyze theeffect of each measure on
target indicators

Total

FYE June 20

FYE June 21

FYE June 22

13

10

11

CHECK Evaluation● Visualization of schedule management, labor

management, and daily tasks● Digitalization of sales tools● Digital Transformation of activities from orderacquisition to production through the use of AI,
DB, and RPA

39 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 40

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Society

Diversity
The Nippon Koei Group has established a working environment
in which diverse human resources with different values andperspectives, regardless of nationality, gender, age, or employment
status, can demonstrate their individuality and abilities and play anactive role in the Group. We believe that this is indispensable for thegrowth of the Group. In our Long-term Management Strategy, we
have also included in our human resource strategy the developmentof a highly productive work environment that makes maximum useof innovative technologies such as AI and ICT in line with theprogress of digitalization, and the pursuit of diverse work styles anddiversity management regardless of the form, place, or time of
employment.
In 2021, to further promote the active participation of diverse
human resources, we set three diversity targets (numerical targets)of ratio of female managers, ratio of foreign managers, and ratio of
mid-career recruit managers, which are all to be achieved by 2030.
These figures will be reviewed and announced each fiscal year, andwe will work steadily to achieve these targets.
In addition, as a basis for the success of these diverse humanresources and the expansion of diverse work styles, we willcontinue to promote the building of various foundations, such as
reducing overtime work, improving the annual paid leave utilization
rate, developing and operating a childcare leave system that is easy
for both men and women to take, creating a gynecological leavesystem to support further success for women, and establishing an
English-speaking consultation service for non-Japanese.

Diversity Goals for 2030
2021 Level

2022 Level

2030 Target

Ratio of female managers

4.5%

5.4%

15% or more

Ratio of foreign managers

0.4%

0.5%

1% or more

Ratio of mid-career recruit managers

30.1%

31.3%

30% (retained)

implement new priority measures at the graduate recruitment stage
to increase the ratio of female employees. Specifically, we have set
a target for increasing the percentage of new female university
graduates hired to at least 20%.

Ratio of New Female University Graduates Hired(Domestic Group Total)
FYE June 19
21.4%

FYE June 20
22.5%

FYE June 21
29.1%

FYE June 22
37.1%

Promoting the Active Participation of
Foreign Employees
Nippon Koei recruits new and mid-career human resources
regardless of nationality to accelerate its global businessexpansions. In addition to further advancing our response to
globalization in Japan, we are also promoting the development of
global human resources for new graduates in career-track positions
as well as the creation of autonomous career plans.

Ratio of Foreign Employees
FYE June 19
1.7%

FYE June 20

FYE June 21

1.9%

2.2%

Code of Conduct(Main Corporate Responsibilities)
Respect for Human Rights:
Nippon Koei affirms diversity and does not limit
employment opportunities or discriminate on the basis ofrace, nationality, gender, thought, faith, or social status.

3.0%

Promoting the Active Participation of
People with Disabilities

Ratio of Employees Who are DisabledFYE June 19
2.02%

FYE June 20
2.17%

FYE June 21
2.09%

Harassment Consultation System
We have established three contact points for harassment-related
consultations. Employees can consult with our Personnel
Department, labor union, or outside attorney. Consultants may
directly consult with these contacts, and the privacy of theconsultants will be strictly protected. Each consultation desk ismade known to employees on the company intranet (this includes
the prohibition and disciplinary action of harassment under theemployment rules, and the dissemination of definitions of various
types of harassment).
In the event of a consultation or report, the department in charge
will investigate the matter and, based on the results of theinvestigation, take corrective measures such as disciplinary action
and implementation of preventive measures.

Business Due Diligence
Guidelines of Conduct(Main Corporate Responsibilities)● Comply with laws and regulations concerning humanrights.
● Respect the personality, diverse values, and character of

We are working to create a comfortable working environment forpeople with disabilities and to develop their work duties, such as
working together as a team for a single task. In 2022, Aichi Tamano
Information System Co., Ltd., a Group company established in
1987 for the purpose of promoting the employment of people withsevere disabilities, was certified as a special subsidiary of the
Nippon Koei Group, transforming from its old form as a subsidiaryof Tamano Consultants. The employment rate in recent years has
been 2.69% (including the special subsidiary), exceeding thestatutory employment rate of 2.3%.

41 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Supporting the ten principles of the UN Global Compact in thefour areas of human rights, labor, environment, and anti-corruption,in line with the “Nippon Koei Group Code of Conduct,” and the “TenEnvironmental Principles,” the Nippon Koei Group obeys laws andordinances related to the human rights of workers in each country
where it conducts business while respecting basic human rights. In
addition, the Nippon Koei Group has established items related to
the respect for human rights in our Basic Sustainability Policy andmateriality.We respect human rights and strive to maintain a fairworkplace without discriminating against employees based on
gender, age, origin, nationality, race, ethnicity, creed, religion, or
disability.

In addition, we plan and implement various training and seminars,
such as “Managerial Seminars for Training Female Subordinates”
based on the increase in the number of young female employees
due to the active recruitment of new graduates in recent years, and“Online Management Training” based on the increase in online
communication due to the Covid-19 pandemic.

FYE June 22

Women’s Participation andAdvancement in the Workplace

In regard to the policy on women’s advancement, we have set
quantitative targets in the “Action Plan based on the Act on
Promotion of Women’s Participation and Advancement in the
Workplace” and are continuing our efforts. In addition, we will

Human Rights Initiatives

FYE June 22
2.69%

each individual, treat each other with respect, and act
responsibly.
● Value the efforts of the International Labor Organization(ILO) regarding human rights and avoid use of child laborthat violates the ILO recommendations or forced labor inany form. Inform our business partners to assume thesame attitude.
● Do not harass or treat others unfairly, including sexual
harassment and workplace bullying. Do not allow others
to take such actions.
● Respect and protect the privacy of individuals. Handle
confidential personal information deliberately according
to the predetermined procedure. Do not leak nor try toacquire unnecessary information.

Training and Seminars
Nippon Koei provides harassment prevention training
corresponding to each career stage. In addition to training for
employees in their third year of employment on how to deal withharassment, etc., lectures by invited experts on the impact ofharassment on mental health, etc., are provided in training for newly
appointed managers and section managers. Company-widetraining for creating a workplace free of power harassment andsexual harassment is held once a year for all managers, and experts
are invited to participate online while reviewing each year’s theme.
The attendance rate has been 100% each time it has been held.

While conducting business in Japan or overseas, Nippon Koei
promotes business due diligence that focuses on environmental
and social aspects. We work to reduce potential human rights risks
by effectively assessing the impact of our activities on people andregional societies based on international standards.

Respect for Human Rights in the
Supply Chain
In recent years, the importance of corporate efforts to respecthuman rights has increased, and we recognize that efforts torespect human rights not only within our company but also
throughout the supply chain are required. For this reason, we haveidentified the creation of “a workplace environment where humanrights are respected and employees feel fulfilled” as one of themateriality issues in our sustainability management, and are aiming
to formulate a human rights policy to promote initiatives based on aclearer understanding of our approach to human rights. As a group,
we will operate with respect for human rights and work together
with various stakeholders, including our business partners, topromote respect for the human rights of all stakeholders related toour business activities.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 42

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Corporate Governance
The Nippon Koei’s fundamental approach to enhancing theGroup’s corporate value is to perform comprehensive corporate
governance by strengthening oversight of management
organizations, ensuring management transparency, and maintaining
a structure facilitating the swift execution of business.

General Meeting of Shareholders
Appoint/
Dismiss

Appoint/Dismiss
Audit

Board of Directors
Recommend

Consult

Nominating and Compensation
Advisory Committee

Cooperate
ReportReportPresident and Representative Director
Audit
Cooperate

Instruct

ReportManagement Council

Total Risk Management Council

Sustainability Promotion Committee

Safety and Health & Environment Committee

Technology Committee

Internal Control over Financial Reporting Committee

Business Strategy Committee

Information Security Committee

Internal
controlaudit

Human Resources Committee
ReportConsult

Main Initiatives for Strengthening Corporate GovernanceBusiness Operations
2003

Corporate Headquarters
Accounting audit

2016

Dispatch auditors

Group Companies

President

From 2001
Katsuyoshi Wada

From 2004
Shu Takahashi

From 2008
Noriaki Hirose

From 2014
Ryuichi Arimoto

Provideadviceandguidance

Appoint/
Dismiss

Legal Advisor

Board of Executive Ofﬁcers

Internal audit

Provide guidanceWork-Life Balance Promotion Committee

ReportAccounting Auditor

Nippon Koei maintains an Audit & Supervisory structure with a
Board of Directors, Audit & Supervisory Board, and accounting
auditors.
In 2003, we introduced an executive officer system as a voluntary
system which separates management monitoring and supervisory
functions from business execution functions, thereby clarifying
responsibilities and accelerating decision-making. Since 2016, wehave established and operated the Nominating and Compensation
Advisory Committee, which includes independent outside officers,
to enhance the supervisory function of the nomination andcompensation of directors, and to ensure the fairness andtransparency of management.

Internal Auditing Ofﬁce
Technical Auditing Ofﬁce

To promote corporate governance, the Company’s Board of
Directors has established and implements the “Fundamental
Approach to Corporate Governance.” The “Fundamental Approachto Corporate Governance” has been formulated with reference tothe chapters of the Tokyo Stock Exchange’s “Corporate
Governance Code” and consists of the following sections: Basic
Philosophy of Corporate Governance (Chapter 1), Ensuring
Shareholder Rights and Equality (Chapter 2), Appropriate
Collaboration with Stakeholders Other than Shareholders (Chapter3), Appropriate Information Disclosure and Transparency (Chapter4), Responsibilities of the Board of Directors and Others (Chapter5), and Dialogue with Shareholders (Chapter 6).

Corporate Governance Organizational Chart

Audit & Supervisory
Board

Basic Corporate Governance Policy

Committees and Meeting Organizations
Related to Governance

From 2021
Hiroaki Shinya

Main Committees Related to Governance
Separation between
management
oversight andbusiness execution

Outside Director

Outside Audit &Supervisory
Board Members

2003

Changed the number of Directors stipulated in the articles of incorporation to 15 or less
Adopted executive officer system

From 2003 1 (11 Directors)

From 2001
1 (3 Audit & Supervisory
Board Members)

Nippon Koei
Group Code of
Conduct

From 2020
3 (11 Directors)

From 2006
2 (3 to 4 Audit & Supervisory Board Members)

From 2016
Nominating and Compensation
Advisory Committee

Committees

Management
Philosophy

From 2014
2 (11 Directors)

Meeting
Frequency

Number of Members

Head

Board of Directors

The Board of Directors, in accordancewith the Regulations of the Board of
Directors, makes decisions about
important matters and oversees the
directors’ execution of their duties.

Meetings arenormally held
once a month

Composed of 11 Directors. 3 are
Outside Directors.
Four Audit & Supervisory Board
members, including two Outside Audit &Supervisory Board Members, also attend
meetings of the Board of Directors.

Representative
Director andChairman

Nominating andCompensation Advisory
Committee

The committee reports its discussions of
personnel changes, director
compensation, and other matters to theBoard of Directors.

6 times a year

Composed of 6 members. These
members include 3 Independent Outside
Directors and 1 Independent Outside
Audit & Supervisory Board Member.

Representative
Director andChairmanManagement Council

The Management Council discusses
basic policies related to businessexecution and important matters related
to management and promotes businessplanning.

Meetings arenormally held
twice a month

The council is composed of 10 members,
including three representative directors aswell as five directors and two executive
officers designated by the President.
One Full-time Audit & Supervisory Board Member
attends the council meetings as an observer.

President andRepresentative
Director

Board of Executive Officers

The Board closely monitors the executionof specific measures related to the annual
business plan and the medium-term
management plan.

Meetings arenormally held
once a month

Composed of 31 members(Representative Director andPresident and 30 Executive Officers).
Two Full-time Audit & Supervisory
Board Members attends the meetings
as observers.

President andRepresentative
Director

Audit & Supervisory Board

The Audit & Supervisory Board conducts
audits related the execution of duties bydirectors and audits including monitoring
the independence of accounting auditors.

Meetings arenormally held
once a month

Composed of 4 members (2 full-time
Audit & Supervisory Board Membersand 2 Part-time Audit & Supervisory
Board Members).

Full-time Audit &Supervisory
Board Member

Total Risk Management
Council

The Total Risk Management Council
supervises the overall promotion of risk
management.

Meetings arenormally held
once a month

Composed of 8 directors with thepresident serving as the Chair.
One Full-time Audit & Supervisory Board Member
attends the council meetings as an observer.

President andRepresentative
Director

Committee/Council Name

Established in 2001

Established in 2001

Basic Corporate
Governance
Policy43 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Revised in 2006

Purpose

Revised in 2013

Established in 2016

NIPPON KOEI GROUP INTEGRATED REPORT 2022 44

Introduction

Policies and Procedures for Nominating andDismissing Directors

Board of Directors
The Board of Directors formulates mid- to long-term strategies
and plans and supervises management to achieve sustainablegrowth and medium- to long-term improvements in corporate value
under its fiduciary responsibility and accountability to shareholders,
thereby improving profitability, capital efficiency, and other aspectsof the company’s operations.

In order to improve fairness and transparency, proposals forappointing/dismissing Directors (proposals for the General Meetingof Shareholders or Board of Directors meetings regarding positions
and appointments), which include the benefits and negatives ofreappointment, are first screened by the Nominating andCompensation Advisory Committee and then discussed by theManagement Council. Afterwards, plans are then decided by the
Board of Directors.
In addition, Plans for appointing/dismissing Audit & Supervisory
Board Members (plans for the General Meeting of Shareholders) are
decided by the Board of Directors after consultation by theManagement Council which obtains consent from the Audit &Supervisory Board in advance.

Concept Behind the Composition of theBoard of Directors
The Board of Directors is based on the concept that eachmember has character, insight, experience, knowledge, and ability,
and can make comprehensive decisions from a broad perspective.
It is composed of members who are judged to be the best in
consideration of their overall balance taking into account thecompany’s business environment.
In order to incorporate diverse perspectives into corporate
management, we appointed one female Outside Director who has
held the position since September 2020. In addition, there is one
female Outside Audit & Supervisory Board Member.
Although there are currently no foreigners serving as Directors,
we ensure diversity in the composition of the Board of Directors asa whole by appointing directors with various skills (experience,
knowledge, and abilities) as shown in the table below.

Strategy

Based on the above concept behind the composition of theBoard of Directors, the Company selects candidates after
identifying various skills (experience, knowledge, and abilities) that
directors and corporate auditors should possess in order to move
our long-term management strategy and medium-term
management plans forward.

The Company analyzes and evaluates the effectiveness of theBoard of Directors every year with the aim of improving thefunctions of the Board of Directors and enhancing governance. We
promote a PDCA cycle to improve the effectiveness of the Board of
Directors by discussing the identified issues at the Board of
Directors meetings and making improvements.

In order to enhance the deliberations at the Board of Directors
and enhance its functions, the Company implements the following
initiatives to train officers and energize deliberations.

Process for Evaluating the Effectiveness of theBoard of Directors
Members is conducted (anonymous questionnaire using
a third-party organization to ensure objectivity)● The Board of Directors evaluates the effectiveness of theBoard of Directors based on the aggregated andanalyzed results of the survey, and the summary of theevaluation results is described in the Corporate
Governance Report which is made public in October.

● The content of the questionnaire is based on fixed-point

Activity status(for reference)

Skills (experience, knowledge, ability)
Name

Job title

Age(Gender)

Corporate
Planning

Technology/
IT

Ryuichi Arimoto

Director and Chairman

69(Male)

Hiroaki Shinya

Representative Director
President

62(Male)●

Takayasu
Tsuyusaki

Director and Vice
President

66(Male)●

Haruhiko Kanai

Representative Director
Senior Managing
Executive Officer

64(Male)●●

Noriaki Yoshida

Representative Director
Senior Managing
Executive Officer

64(Male)●●

Yasushi Hirusaki

Director
Managing Executive Officers

60(Male)●Tomohisa
Fukuoka

Director
Managing Executive Officers

59(Male)●●

Hiroshi Yokota

Director
Managing Executive Officers

62(Male)●●

Hiizu Ichikawa

Outside Director

75(Male)

Kazumasa
KusakaOutside Director

Yoko Ishida●

Sales/
Marketing

Human Resources
Development
●

●

●

●

●

●

Financial/
Accounting●●●

Legal/
Internal
Control
●

●

●

●

●

●

●

Environment/
EnergyGlobal●Number of Board of
Directors Meetings
Attended (FYE June 2022)

13

18/18
(100%)

5

18/18(100%)

●

●

5

18/18
(100%)

●

●

5

18/18
(100%)

1

13/13(100%)

5

18/18(100%)

1

13/13(100%)●●

Number ofyears in theposition

●

●

●

●

●

●

●

●

ー

ー

●

●

●

●

●

●

8

18/18
(100%)

74(Male)

●

●

●

●

●

●

7

18/18
(100%)

Outside Director

65(Female)

●

●

●

2

18/18
(100%)

Yoshizo Goto

Full-time Audit &Supervisory Board Member

63(Male)

●

●

●

●

●

4

18/18
(100%)

Kunio Okamura

Outside Full-time
Audit & Supervisory
Board Member

68(Male)

●

●

●

●

●

3

18/18
(100%)

Naoki Honjo

Audit & Supervisory
Board Member

68(Male)

●

●

●

●

●

4

18/18
(100%)

Yoshiko Koizumi

Outside Audit & Supervisory
Board Members

79(Female)

●

●

●

●

5

18/18
(100%)●●●

Status of the Company

Initiatives for Enhancing the Deliberationsof the Board of Directors

Evaluation Content

Officer Skills

Review of Operations

Evaluation of the Effectiveness of theBoard of Directors● A survey for Directors and Audit & Supervisory Board

Officer Skills

Sustainability/ESG

observation. However, social issues, recent issues facedby the Company, etc. will be newly added.
● This year’s survey addressed eight topics:(① composition and operation of the Board of Directors,② management and business strategies, ③ risk andcrisis management, ④ monitoring of group companies,⑤ evaluation and compensation of management).
⑥ Investment-related, ⑦ Dialogue with shareholders,etc., ⑧ Other matters).

Evaluation Results and Future Issues(Evaluation results)● Confirmed that the effectiveness of the Board of
Directors of the Company was ensured, including theimprovement of the matters indicated previous fiscal
year.

Officer Training
In order for officers to properly fulfill their responsibilities,
the basic objective of officer training is for officers toacquire necessary knowledge and improve abilities
regarding corporate value, governance, etc.
● Training for officers at the time of their appointment
When an officer is newly appointed, we provide training
to them on the roles (including legal responsibilities)
expected of Directors and Audit & Supervisory Board
Member, compliance, etc. In addition, we explain our
corporate history, Management Philosophy, businessoutline, management situation, governance system, etc.
to outside officers.
● Ongoing training after their appointment
We regularly invite lecturers from outside of theCompany to hold seminars on topics that are relevant tocurrent events for all officers. We also continue toprovide opportunities for officers to acquire specialized
knowledge, such as attending outside seminars.

Initiatives to Promote Lively Discussions● Since 2014, the Board of Directors has had two Outside

Directors to encourage lively discussions. In addition,
since September 2020, the Company has appointed an
additional female outside director, making it threeoutside directors, thereby ensuring diversity in thecomposition of the Board of Directors and achieving
even more vigorous deliberations.
● In order to demonstrate the function of the Board of
Directors as a monitoring board, we have beentransferring authority since 2018 to the President on
certain orders, which were previously decided by the
Board of Directors.

(Issues)● Expansion of business execution reports of Group
companies● Further improvement of Board of Directors operations* Since Noriaki Yoshida and Tomohisa Fukuoka were newly appointed and assumed their positions at the 77th General Meeting of Shareholders held on September 29, 2021, the number of Board of Directors meetings they were able to attend differs from that for the other
Directors listed.
* Because Director Hiroshi Yokota was newly appointed and assumed his position at the 78th General Meeting of Shareholders held on September 29, 2022, the terms of office and attendance for the fiscal year ended June 30, 2022 are not shown.

45 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 46

Introduction

Policies for Developing Our Next
Generation of Executives
President Succession Plan
The President Succession Plan was established by the Board of
Directors after deliberation by the Nomination and Compensation
Advisory Committee for the purpose of selecting candidates whomeet the personnel requirements for the position of President of theCompany. This plan consists of the development andimplementation of a plan to enhance the qualities required of acandidate to become President, and the evaluation, selection, anddeliberation processes of the candidate for becoming President.
In implementing the President Succession Plan, the Nomination
and Compensation Advisory Committee thoroughly deliberates on
the successor candidates proposed by the current President,
taking into account the exchange of opinions with the candidates
and their compatibility with medium- to long-term management
strategies and strives to ensure transparency, fairness, andobjectivity of the plan.

Development and Selection of Executive
Candidates
We recognize the importance of forming a group of executive
management candidates in order to enhance the above-mentioned
candidate pool for President and to strengthen as well as stabilize
the management foundation of our Company and our Group.
As a measure to realize this, we have introduced a system fortraining and selecting candidates for management positions from thestage of promotion to the highest level of employee qualifications.
Specifically, employees with certain in-house qualifications andpositions, who are selected through the recommendation of theirdepartment heads, are required to attend SMC (Senior
Management) training, where they analyze and formulate businessstrategies and solutions under the guidance of external instructors
for about six months on themes such as creating new businesses
and overcoming management issues at the Company, and present
them to Company management. The purpose of this training is tofoster the ability to make strategic decisions from a management
perspective.
Candidates for promotion to the highest level of internal
qualification will be recommended from among the participants ofthis SMC training, and promotion will be decided through interviews
with internal directors (including presentations). In order to acquire
the general knowledge required as a candidate for executive
management, these promoted candidates will participate in training
sponsored by external organizations.
In addition, candidates who are nominated to become executive
officers on the recommendation of the President will be interviewed(including candidate presentations) with outside directors as theirmain interviewers. Based on their opinions, candidates will be
appointed as executive officers through prescribed procedures
such as resolutions of the Board of Directors. Newly appointed
executive officers will participate in training organized by externalorganizations for the purpose of acquiring knowledge of generallaws and regulations necessary for managers and fostering theirresolve as managers.

47 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Policy Regarding Strategic Shareholdings

Results-based Compensation (bonus)

Restricted Stock Compensation

For the purpose of business expansion and sustainable growth of
our company, our policy is to hold stocks that are necessary forpolicy purposes while selling stocks when it is no longer rational tohold them, as appropriate based on a comprehensive considerationof their importance in business strategy and business relationships
with business partners, from a medium- to long-term perspective.
Strategic shareholdings are examined from a medium- to longterm perspective, taking into account their returns and risks. The
purpose and rationality of strategic shareholdings reflecting theseresults are examined by the Board of Directors.
With regard to voting rights for strategic shareholdings, voting
rights are exercised based on factors such as whether the investee
company is conducting management that places emphasis on thedevelopment of the investee company and the interests of its
shareholders, and whether the proposal contributes to theenhancement of the corporate value of the investee company.

For directors (other than outside directors), performance-linked
compensation (bonus) is positioned as an incentive for short-term
performance improvement, and sales revenue and net income
attributable to owners of the parent company for each fiscal year
are selected as appropriate performance evaluation indicators.
Specifically, a standard amount is determined according to theachievement rate based on the planned value of sales revenue andprofit attributable to owners of the parent company as a bonus
payment standard, and the Representative Director and President
evaluates the degree of achievement of business performance andthe degree of contribution to the company, etc. of each Director.
Furthermore, bonuses are paid every year at a certain time after theend of the relevant fiscal year within the maximum annual amountof remuneration for directors approved by the General Meeting of
Shareholders following deliberation by the Nomination andCompensation Advisory Committee.

Restricted Stock Compensation has been implemented startingin September 2017 with the intention of having directors share withshareholders the merits and risks of share price fluctuations andproviding additional motivation to contribute to increase in the shareprice and enhancement of corporate value.
Within the scope of the total amount of monetary compensation
claims to be paid as compensation for restricted stock that has
been approved separately from the annual limit of director
compensation at the general meeting of shareholders, restricted
stock is allocated at a certain time each year by having themonetary compensation claims paid to each director contribute inkind according to predetermined criteria for each position.

Approach to Officer Compensation anda Description of Each Type ofCompensation

Description of Officer Compensation

Description of Compensation System for
Directors
Director compensation follows the compensation framework
established at the General Meeting of Shareholders, and individualcompensation amounts are set using the following policies andprocedures established by the Board of Directors. The Company
has adopted a structure in which these compensation systems arereviewed by the Nominating and Compensation Advisory
Committee, which is primarily comprised of independent outside
directors, as necessary.
In addition, compensation is structured as described below.

Directors Other than
Outside Directors

Composed of fixed compensation (monthly
compensation), results-based compensation(bonus) and compensation for restricted stocks

Outside Director

Composed solely of fixed compensation(monthly compensation)

Audit & Supervisory
Board Member

Composed solely of fixed compensation(monthly compensation)

Director(excluding
outside director)

Outside Director

Audit &
Supervisory
Board Member

Fixed Compensation

Directors (excluding outside directors): Up to ¥465 million(includes bonus)
Outside Directors: Set at ¥45 million
Audit & Supervisory Board Member: Set at ¥80 million

●

●

●

Results-based
compensation (bonus)

The standard amount is determined according to thepercentage of achievement of the planned value of sales
revenue and profit attributable to owners of parent

●

–

–

Set at ¥60 million

●

–

–

Compensation (annual amount)

Restricted Stock
Compensation

Standard Compensation Structure for Director Compensation
Fixed Compensation (Base Compensation)

Results-based compensation (bonus)

Restricted Stock Compensation

67%

19%

14%

Compensation Amounts for Directors and Audit & Supervisory Board Members in FYE June 2022
Total Amount of Compensation by Type (Millions of yen)(individual compensation is determined throughconsultation among corporate auditors)
Officer Classification

Compensation(Millions of yen)Fixed Compensation

Number of Eligible
Officers

Number of Officers
Eligible

Base
Compensation

Restricted Stock
Compensation

Bonus

359

206

43

110

10

29

29

–

–

2

Outside Director

45

45

–

–

3

Outside Audit & Supervisory
Board Members

33

33

–

–

2

Fixed Compensation
Fixed compensation (base compensation) for Directors (otherthan Outside Directors) is determined for each Director based on
their role and level of responsibility. Monthly compensation isdetermined in accordance with the standards predetermined foreach official position.
Part of the compensation of Outside Directors is spent to acquire
the Company’s share under the Directors’ Stock Ownership Plan.
Audit & Supervisory Board Members have the option of allotting a
portion of the salary to be used to acquire Company shares in the
Officer Shareholding Association.

Total Amountof

Directors(excluding outside directors)
Audit & Supervisory Board
Members(excluding outside members)

48

Introduction

Strategy

Compliance

Compliance Training

Risk Management

In order to conduct business appropriately in a global society andto prepare for all kinds of risks that may hinder business activities,
initiatives and guidance that serve as common guidelines worldwide
are becoming increasingly important. We are aware that thoroughcompliance is a source for increased corporate value, and we are
striving to achieve highly transparent management. In addition, weare systematically responding to compliance risks in promoting ourbusiness by visualizing them as much as possible.

We provide training on compliance by career level, holdcompliance lectures for officers and executive employees, andprovide training for each department. During training sessions,lectures are given on causes and preventive measures withreference to specific cases, and participants learn about laws which
are closely related to our business. In addition, through the Group’s
E-learning system, we conduct education and testing on various
themes such as compliance with the Antitrust Act and harassment,
and provide training for employees, including training for employees
at some Group companies.

As we conduct a wide range of business activities on a global
level, we believe that a solid risk management system is essential
for implementing our business strategies. In formulating long-term
management strategies and medium-term management plans,risks are comprehensively identified and closely monitored as we
conduct our business activities, while incorporating various
measures to hedge risks.

Code of Conduct
The Nippon Koei Group has established the Nippon Koei Group
Code of Conduct (basic policy) for the Group’s common code of
conduct, and aims to truly enhance corporate value by
incorporating it into the daily actions of each and every executive
and employee. It has been made available into seven languages,
including Japanese, English, and Spanish, and shared with
employees around the world. We aim to create a highly transparent
management system and build a relationship of trust across theentire Group as well as establish and operate a complianceobservance system that also aims for the Company to adhere tosocial norms in order to put into practice our Management
Philosophy “Act with integrity and contribute to society throughtechnology and engineering” in accordance with laws andregulations.
Nippon Koei Group Code of Conduct URL
https://www.n-koei.co.jp/english/profile/ideas/pdf/code_of_conduct.pdf

Compliance Organizational Chart
Board of Directors

External
Reporting Desk

Company-wide
Compliance
Liaison Council
Group
Compliance
Liaison Council

Total Risk Management Council
Business Operations Committee

Head Ofﬁce Committee

OfﬁcesCompliance Ofﬁce withineach Headquarters

OfﬁcesLegal & ComplianceDepartment

Business Operations
Compliance Managers
CouncilGroup Companies

Compliance Awareness Survey
The Nippon Koei Group regularly conducts a complianceawareness survey of officers and employees within the Group every
year. All surveys are conducted anonymously with the results
disclosed within the Group and reflected in our complianceactivities.

NIPPON KOEI GROUP INTEGRATED REPORT 2022

Compliance Consultation/Reporting
System
We established the Consultation/Reporting System Regulationsin 2003 and have set up a system where employees who becomeaware of compliance violations or actions that may violate
compliance can directly consult or report to the Department incharge of compliance or an outside attorney. This system isavailable not only to our employees but also to temporary
employees, Group companies, and business partners. The numberof reports (excluding consultation cases) over the past few years is
as shown in the table below.

Number of Internal Reports
FYE June 2020

FYE June 2021

FYE June 2022

12

7

7

Sustainability/ESG

Risk Management Organization and
SystemAs an organization to supervise the overall risk management
promotion, the Total Risk Management (TRM) Council meets monthly
to identify and assess risks within the Group and promote risk
prevention and countermeasures.
The TRM Council is comprised of eight directors including thePresident serving as the Chair. Each meeting includes an Audit &Supervisory Board member who attends as an observer. Executive
Officers of Nippon Koei have the duty of conducting risk
management related to the assigned duties each was given. Total
Risk Management Council members consist of individuals who areat the Executive Officer level or above.
The TRM oversees the overall promotion of risk management,
and the TRM as well as the Safety and Health & Environment
Committee, Internal Control over Financial Reporting Committee,
and Information Security Subcommittee, all of which are under thesupervision of the TRM, manage risks across the entire company
and report important risk information monthly to the Board of
Directors.

Initiatives for Preventing Corruption
As our Group is expanding its business globally, we cannot deny
the risk of being asked to provide improper financial benefits in thecourse of promoting business, discussions, and negotiations withlocal government agencies, etc. Therefore, we must assume suchcases in advance and take firm action.
Since the Nippon Koei Group is a signatory to the UN Global
Compact, it has incorporated the four areas of human rights, labor,
environment, and anti-corruption, and their ten principles, into our
Code of Conduct, which we adhere to. The Code of Conduct
stipulates that we will not pursue profits by unfair means and that
we will conduct our business activities in compliance with laws andregulations based on fair, transparent, and free competition.
In addition, in order to ensure thorough compliance, we haveestablished and operate internal rules such as the Anti-Bribery
Regulations. For example, we have established standards for what
constitutes inappropriate expenditures, and we have establishedrules to deal with the risk of fraud, such as ensuring that any
unreasonable demands are not judged solely by the field, but arealways discussed with the Head Office.

Review of Operations

Status of the Company

In the event of a crisis, in accordance with the Crisis
Management Regulations, a Company-wide emergency task force
or emergency task force of the relevant department is established
to respond appropriately to the crisis after promptly reporting to the
President (who serves as Chair of the TRM Council).

Business Continuity Initiatives
If we do not have adequate countermeasures for natural
disasters as well as for epidemics and outbreaks of infectious
diseases, there is a risk that we will be forced to suspend
operations for a long period of time, which could result in significant
losses that would have a major impact on our stakeholders. As acompany involved in the infrastructure that supports people’s daily
lives, we believe that it is our social responsibility to continue toprovide stable services. Therefore, we have established a business
continuity plan (BCP) and are working to create and regularly review
procedures for responding quickly and appropriately in the event ofa crisis.

Quality and Environmental Management
System
We have established and implement a quality and environmental
management system in accordance with ISO 9001 and ISO 14001.
This system standardizes work procedures in projects, review andverification methods, and checks the degree of achievement ofquality targets. This minimizes risk and promotes the achievementof project objectives. In addition, by continuously acquiringknowledge about the environment and improving technicalcapabilities, we have realized consideration, including environmental
risk management.

Risk Management Plan Formulation and
PDCA Cycle
Information Security
Based on the Basic Policies on the Development of Internal
Control System established by the Board of Directors, Nippon Koei
has formulated a Group-wide Risk Management Plan and is
promoting systematic risk management.
Each division identifies and evaluates risks associated with its
business activities each fiscal year, formulates specific management
measures to prevent risk events from materializing or to minimize
the possibility of losses, and drafts a risk management plan. Aftercompiling risk management plans for each department anddiscussing and formulating a Group-wide risk management plan,
TRM regularly monitors the progress of the risk management plan,
review the progress, issues, and future countermeasures, andimplements a PDCA cycle. When a significant risk event becomesapparent, we conduct an assessment of the risk management plan,take necessary measures and improvements, and reflect them in
the risk management activities of each division. In addition, thestatus of risk management at Group companies is reported to the
TRM Council by the heads of each department, and it is monitored
on a regular basis.

The Group has established an information security system toappropriately manage the confidential information of customers inorder to receive and perform consulting services from customers,
including government and public agencies. The Group Code of
Conduct stipulates the thorough protection and management of all
information obtained in the course of work and the prevention ofunauthorized use and leakage. In addition, we have established andimplement the Basic Policy on Information Security and theInformation Management Rules to protect and manage informationand prevent unauthorized use and leakage. In addition, as a
response to increasing information security risks such as
cyberattacks, we continuously improve information security
measures under the supervision of the Information Security
Subcommittee established under the TRM Council. In addition, we
have been audited by a third-party organization and somedepartments have obtained the ISO 27001 certification, aninternational standard for information security management systems(ISMS).

50

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

A Discussion with Outside Directors
long-term management strategy. When diversifying, somecontinue to promote diversification and aim to become ancompanies establish new companies under the umbrella of a mainorganization that encompasses a wide range of fields. However,company, but there are cases where communication between thewhat is most important in doing so is having leaders who can drive

main company and its subsidiaries may not be successful. In thegrowth. If each leader can exert a strong centripetal force and unite

Nippon Koei Group, each business has different origins, track

a diverse group of people toward a single goal, the organization willrecord, and way of working, so it is important to establish an

develop into a powerful entity with many strengths.

organizational structure that facilitates communication within the

In this sense, just as important as the transition to a pure holding

Group as smoothly as possible.

company structure is the further strengthening of the supervisory

For this reason, it was thought that a horizontal relationshipfunction of the holding company. As a holding company with awould work better for the Nippon Koei Group, in which othernominating committee,etc., it is important that the committees

operating companies, including Nippon Koei itself, are establishedproperly discuss and select leaders who are suitable to lead theunder the umbrella of the holding company rather than a vertical

Nippon Koei Group in an open and fair manner. I would like people

relationship between Nippon Koei as an operating company and its

to focus on the new structure of the Nippon Koei Group, which willsubsidiaries for group governance. With the Consulting Business aspromote both the shift to a holding company structure to

the “eldest son” and the Urban & Spatial Development Business,encompass a wide range of diverse fields and the function ofEnergy Business, and other business companies that have newly

objectively selecting leaders to oversee these fields.

joined the Nippon Koei Group serving as “younger daughters andsons,” I believe that it will be possible to create a relationship ofmutual understanding and cooperation among the businesscompanies. In order to realize the ideal vision we have envisioned― What other changes are you expecting as a resultof the transition to a holding company?

for the future, I believe that the optimal organizational structure at

Yoko Ishida
Outside Director

Transition to a Holding Company― Please tell us your thoughts about Nippon Koei’stransition to becoming a holding company.
KusakaRegarding the transition to a holding company, at first I

would like to say that although organizations in the world exist in

51 NIPPON KOEI GROUP INTEGRATED REPORT 2022

present is a pure holding company structure.

KusakaIshida The business conditions surrounding the Nippon Koei

the growth of potential leaders. As an example, it is conceivableGroup continue to change drastically due to the spread ofthat human resources who have been active in the operating

Covid-19, the permeation of DX, and the further progress ofcompanies for 15 to 20 years will be transferred to the Corporate

globalization. In addition, as the positions of countries around thePlanning Department of the holding company for about two years.

world and regional communities such as ASEAN are changing, theWhile simply staying with the operating company to which you

nature of Japan’s ODA is also changing. It is becoming increasingly

originally belonged may deepen your knowledge of the businessdifficult to formulate future-oriented plans in management based onfield, it is difficult to gain a multifaceted perspective doing so. The

common sense, so we need to increase management flexibility

holding company brings together potential leaders who are

more than ever. For the Nippon Koei Group, it is necessary to build

expected to play a central role in the future management of the

an organizational structure that is both top-down and bottom-up

Nippon Koei Group and gives them the opportunity to enhancerather than the monolithic corporate management scheme that has

their understanding of the group as a whole and their knowledge ofbeen in place until now with Nippon Koei at the center. Instead ofgroup management. If each potential leader gains this kind of

Kazumasa Kusaka

concentrating our strengths in the monolithic Nippon Koei, eachexperience and plays an even more active role after returning to his

Outside Director

operating company should demonstrate its strengths whileor her original company, it will lead to the sustainable growth of thecollaborating within the Group to create new value. In other words,

entire Group as a result. I believe that the deepening ofeach operating company should autonomously demonstrate its

communication and personal relationships among seconded

strengths. At the same time, we aim to build an organizational

employees will also strengthen the cohesiveness of the entire Groupvarious forms, there is no form that will act as a panacea to makestructure that maintains a sense of unity as the Nippon Koei Group.

in the future.

everything go well. Since conditions surrounding a company

This is what is behind the transition to a pure holding company

change depending on the trends of the times and various

structure.

circumstances, we should think about organizational design from

Ichikawa

the perspective of how we can achieve the desired results

will work just because the organization has a given form. An

stakeholders while exercising their authority as president. By doing

according to the circumstances at the time. Since its founding,organizational form is only a box. Therefore, the success of aso, they will be able to realize their potential and eventually grow

Nippon Koei has continued to grow with the Consulting Businesscompany is determined by the ability of the people within to

into leaders who can lead the entire Group.

serving as its core business. From the 2010s, Nippon Koei has

demonstrate their individual strengths. When it comes to whether

Ishida I think it is true that the position makes the person. If thediversified its business by launching its Urban & Spatial

the organization or the people are more important, it goes withouttransition to a holding company structure increases the number ofDevelopment Business and Energy Business as part of its previous

saying that the people are more important. Nippon Koei Group will

new positions, we can expect to further promote diversity, including

Hiizu Ichikawa
Outside Director

It can also be expected that the transition will accelerate

In addition, the head of each business division will move from theposition of making decisions in that division to that of president of a

As Mr. Kusaka said, it does not mean that everything

single operating company and will fulfill their accountability to

NIPPON KOEI GROUP INTEGRATED REPORT 2022 52

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

increasing the number of our female and non-Japanese employees.

expansion in North America with Quadrangle as a foothold, BDP is

Ichikawa

In the past, community and infrastructure development was carried

expanding its business area both geographically and vertically.

people. They listen and respond to customers when they are reallyout almost exclusively from the perspective of men. Recently,

Since these companies are also subsidiaries of the Nippon Koei

facing trouble. I think that is the most important thing for a company

however, the opinions of women have been incorporated as well.

Group, we have the opportunity to hear directly about the latest

to do, and I hope that Nippon Koei will continue to be such a

Diversity at the project level is progressing steadily and I believe thattrends in the business environment from our colleagues wherecompany.

the transition to a holding company structure will lead to greater

those companies are based, including the political economy ofdiversity at the management level.

each country, rather than obtaining information from the media inopinions through my own filters on each and every move that

KusakaFrom my experience, good companies have good

I believe that my role as Outside Director is to continue to convey

Although the ratio of female managers at Nippon Koei isTokyo. We can get opinions from different perspectives on the

Nippon Koei faces. I feel that guiding Nippon Koei in a direction thatjust over 5%, I expect that if more women are placed in positions ofsame phenomenon. Diversity is not just about gathering people

I think is appropriate will contribute to the company.

responsibility in the future, they will contribute to the creation of new

with different attributes. It is intrinsically valuable in working with

Kusakavalue from a different perspective than men.

people with different perspectives and having contact with otherI also feel that companies are ultimately all about people. The

Both Ms. Ishida and Mr. Ichikawa talked about “people.”

Ishida Since connections with overseas group companies,

parts of the world. I believe that interacting with employees of“software” (people) is combined with the “hardware” (organizations)

including BDP Holdings Limited (BDP), a British architectural design

overseas-based Group companies and deepening mutual

and the wisdom of each organization is accumulated. Therefore, I

firm that is part of the Nippon Koei Group, are increasing, we mayunderstanding of different cultures will serve as the foundation forwould like to meet with all employees at Nippon Koei Groupconsider taking advantage of the expanded cooperative

Nippon Koei, a Japanese company, to play an active role in the

regardless of position to deepen our communications when therelationships to develop human resources, such as transferring

world, create value, and grow.

Covid-19 pandemic is under control. I think there are opportunities

employees from Nippon Koei to those companies and humanfor small groups to meet for dinner and where people can talk

resource exchanges with universities.

freely, so traveling to many sites and engaging in dialogue with

Ichikawa

employees is what I most want to do now.

Another option is to constantly send two or threeof the Sustainability Promotion Committee, I am very happy that wetrainees to a Group company that possesses know-how, such as

are now able to have discussions about materiality issues.

BDP. BDP also acquired Pattern Design Limited, which designed

About Our ESG Initiatives

the stadiums for the Football Qatar World Cup. Since we have such

KusakaIt is important to use the identified materiality issues as

a company with a global presence under our corporate umbrella, I

tools for communication with stakeholders. In the process of

think it would be good if we could expand mutual exchanges andcarefully explaining to investors and other stakeholders whatenable Nippon Koei employees to learn about their latest
technology. By absorbing their knowledge, we should be able to― I would like to hear your opinions on the Nippon

Koei Group’s seven materiality issues.

Nippon Koei believes is important and why, I believe that the Groupcan clarify its values.

increase the overall strength of the Group as a whole.
KusakaIn 2019, BDP acquired the Canadian architecturaldesign company Quadrangle. By accelerating its business

Ichikawa

Solving social issues is what Nippon Koei does. It is

our mission to play a role in the field of renewable energy, since theenergy sector, which is linked with the decarbonization of society,was the first business undertaken by our founder, Yutaka Kubota.
All of the seven materiality issues are important for the Nippon Koei

Closing Messages

Group to grow sustainably together with society. However, it may
be more effective to promote each materiality issue with somedegree of prioritization rather than to pursue each in a uniform
manner. From this perspective, “Challenge to decarbonization” is aparticularly important materiality issue.
In the consulting field, DX must be fully utilized to improve― In closing, could you each give us a closing

message regarding your expectations for the
future of the Nippon Koei Group and the role thatyou would like to play as an Outside Director?

efficiency and speed. In order to strengthen infrastructure, it will be

53 NIPPON KOEI GROUP INTEGRATED REPORT 2022

necessary to devise ways to double or triple the efficiency within a

Ishida Construction and development consultants in the Nippon

limited budget. To achieve this, it is important to enhance theKoei Group play an important role in creating plans to materializeorganization and human resources.

policies created by JICA and other national agencies and in giving

Ishida I think it is important to give priority, but also to encourage

shape to the needs of local people, but they are not well known

the Nippon Koei Group to focus on areas that it has not

and are often seen as behind-the-scenes helpers. Althoughemphasized so far is the significance of raising the seven materiality

reserved nature and seriousness are good qualities of this company,

issues. For the Nippon Koei Group, which operates not only in

I would like to see the Nippon Koei Group’s presence enhanced by

Japan but also overseas, this is a good opportunity to raise

strengthening its ability to communicate outside the industry a bit

awareness of global social issues. It is important to recognize ourmore. I expect that this will lead to the acquisition of excellent human

company’s situation from the perspective of society. As a member

resources and the development of new markets.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 54

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Nippon Koei Group Business Segments
Nippon Koei’s business is comprised of the following three business segments and is building vibrant societies
across the globe.
Financial results for the fiscal year ended June 30, 2022 show record highs in both sales revenue and incomes.

FYE June 2022

Composition Ratio of Revenue

Consulting Business

Main Customers

Orders and Revenue (millions of yen)

National and local governments, JICA, overseas government
agencies, and private companies(Millions of yen)

In Japan, the Consulting Business provides a full range of civilengineering consultation related to infrastructure development,
maintenance, and safety for local and national government
agencies, such as the Ministry of Land, Infrastructure, Transport
and Tourism. With proven technologies informed by diverse
experience and R&D, the operation has grown into acomprehensive consulting service covering a vast array of
projects encompassing the improvement, management, andmaintenance of infrastructure supporting daily community life.
Overseas, we are developing business mainly throughJapanese government ODA projects, mainly in Asia, but also in
Africa, the Middle East, Central and South America, and other

Urban & Spatial Development Businessregions. The Nippon Koei Group is engaged in numerous
infrastructure projects in fields ranging from water resources andwaterways, energy, urban and regional development,
transportation, agricultural and rural development, environment,
and disaster prevention. The Group is active on the front lines ofsocial contribution and humanitarian aid across borders.
Examples of our activities include environmental measures tocombat global warming, developing regional transportation
infrastructure in emerging countries undergoing rapid economic
growth, and assisting in reconstruction in regions affected byconflict or natural disasters.

Main Customers

OrdersNippon Koei launched the Urban & Spatial Development
Business in March 2016 when it welcomed BDP of the UK into
the Group. The aim of the launch of this business segment is toexpand business by capturing the growing needs in thearchitectural domain as urban development progresses aroundthe world and combining it with the civil engineering domain, an
area in which we excel. Through collaboration with BDP, we areworking to create urban spaces in Asia by combining civilengineering and architectural technologies.
We are also working to diversify our business fields by adding
Canada-based Quadrangle, which specializes in high-rise
construction, to our group in 2019, and UK-based Pattern, which
specializes in sports facility construction, to our group in 2021.
Against the backdrop of the increasing number of projects in

Main Customers

Revenue

120,000

Operating proﬁt(Millions of yen)
10,00097,76980,09815

7,500

72,59367.7%

20

98,491
88,51090,000Operating Margin (%)
8,982

106,931

6,126
5,457

60,000

5,000

10
10.1
7.5

30,000

7.6

5

2,500

0

0
20/6

21/6

0

22/6

20/6

21/6

22/6

Private companies and local governments(Millions of yen)

Energy Business

Operating Profit and Operating Margin (millions of yen/%)Japan that need to be approached from both civil engineeringand architectural perspectives, such as urban development andredevelopment, we merged our Urban & Spatial Development
Business, one of our business segments, with Tamano
Consultants, a Group company, and then formed a newcompany, Nippon Koei Urban Space, in July 2022. By integrating
the technologies and functions of both companies, we aim toenter the market for urban infrastructure formation in Japan andoverseas, and become a comprehensive production company
with greater proposal and development capabilities than everbefore for urban and regional revitalization projects, public-private
partnerships, and smart city development, in order to work
toward the formation of sustainable cities.

Orders

Revenue

30,00020,000Operating proﬁt(Millions of yen)2500

18,142
17,874

21,457
20,274

22,580

2000

15

2,266

1,759
11.2

18,207

1500

17.3%

Operating Margin (%)

1,588

10

9.7

1000

7.0

10,000

5
500

0

0
20/6

21/6

22/6

0
20/6

21/6

22/6

Power companies, local governments, and private companies(Millions of yen)Orders

Revenue

Operating proﬁt(Millions of yen)

Operating Margin (%)

19,986The segment constructs and repairs substations, switchingstations, and power plants operated by power companies
constructs central monitoring and control systems to improve
operating efficiency, constructs dam control systems athydropower plants, and manufactures related equipment. The
Power Engineering Business proposes optimal solutions forelectric power companies to support electric power development
and meet electric power needs in Japan and emerging countries.
As a new initiative, we are engaged in research, development,
design, construction, management and operation support, andsystem and technology development for energy management
projects utilizing distributed energy resources in response to the

55 NIPPON KOEI GROUP INTEGRATED REPORT 2022

recent expansion of renewable energy markets and powersystem reforms in Japan and overseas. We are accumulating
business and technological know-how in Europe, where theseparation of power generation and distribution and theintroduction of renewable energies are leading the way, and areaiming to expand our business in Japan and other Asian
countries in the future. The Company is also involved in thebusiness of operating hydroelectric power plants and sale ofelectricity. We install small-scale hydroelectric power plants inexisting dams that are not used for power generation purposes togenerate clean and economical small-scale hydroelectric power.

18,79920,00016,45215
1,290

16,621
13,991

15,0001500

14,343

1000

14.4%

10
814

10,000

640
6.9

500

5
4.9

5,000
3.9

0

0
20/6

21/6

22/6

0
20/6

21/6

22/6

* The Company has been conducting business in three business segments since FYE June 2022. For the Consulting Business, we combined our domestic and overseas consulting businesses and combined our former Power Engineering and Energy Business to form our current Energy Business.
* Results for the Consulting Business and Energy Business for the fiscal year ended June 30, 2020 have been combined to conform to the current segment structure, and the figures are simple totals before elimination of internal transactions.
* From the fiscal year ending June 30, 2023, Nippon Koei Urban Space and its subsidiaries will change their business segment classification from “Consulting Business” to “Urban & Spatial Development Business.”
Segment information for the fiscal year ended June 30, 2022 has been prepared based on the revised business segment classification.

56

Introduction

Strategy

Sustainability/ESG

Market Trends (Overseas)

Consulting BusinessOur clients include the Japan International Cooperation Agency(JICA) and other Japanese ODA implementing agencies,
international organizations, such as the World Bank and the AsianDevelopment Bank, and foreign governments. In recent years, due
to the increasing demand for infrastructure in emerging countries,
the number of projects has been increasing year by year andbecoming larger in size. In recent years, the Japanese
government's “Infrastructure Systems Overseas Expansion Strategy
2025” has set high order targets, etc., leading to consistently strong
demand. In regard to ODA loans, the ratio of projects in India and
Bangladesh has been increasing, and in terms of fields, newdevelopment of transportation, such as railroads, and urban
development, such as smart cities, have been increasing in order tocope with population growth in emerging countries and to achievea decarbonized society.

For the fiscal year ended June 2022, revenue increased by approximately 10% and operating
profit increased by approximately 46% both in Japan and overseas due to favorable businessperformance. In particular, since travel restrictions due to COVID-19 have been eased overseas,
operations for several large projects have started, boosting our contract utilization rate to arecord high level. In July 2020, we integrated our Domestic Consulting Business, International
Consulting Business, and R&D Center mainly for the purpose of optimizing the allocation of
resources in line with business conditions. Currently, we continue to operate flexibly, allocating
domestic personnel to serve in active overseas operations. In addition, in order to promote theresilience of the Nippon Koei Group, we have begun to lay the groundwork for achieving ourlong-term management strategy, including acquiring technologies to expand our businessdomains and creating business alliances for new services.
Moving forward, we will continue to implement measures to improve productivity, develop newservices using new technologies, and promote business expansion utilizing our co-creation partners.

Water resources and waterways
Flood protection, efficient water use,
and water environment improvement
Water and sewage
Support for efficient operation andmanagement of water and sewage
facilities
Urban and regional development
Policy planning support for masterplanning of urban areas and region
development of local governments
and equipment of development
facilities
Disaster Prevention and Mitigation
Emergency response to disasters suchas earthquakes, volcano eruptions,and localized torrential downpour andplanning of disaster prevention
Dams and power generation
New dam construction,
redevelopment and extension ofservice life for existing dams

Transportation (roads, bridges,
airports, etc.)
Establishment, extension of service
life, efficient maintenance andmanagement, automatic operation
planning, and MaaS planning related
to traffic and transport facilities
Environmental Management
Improvement of air, water, and soil
environments and biodiversity
conservation
Maintenance and aging
countermeasures
Management planning of measures foraging infrastructure (bridges, tunnels,
embankments, water supply andsewage systems, etc.) and efficientmaintenanceManagement
Asset management, public-private
partnerships (PPP, PFI)

Orders
Revenueindustry and one of the top Japanese companies interms of sales for Japanese government ODA projects
for many years● Established strong partnerships with our clients throughour business bases in 47 prefectures in Japan and our
extensive business experience overseas, especially inemerging Asian countries● Largest number of professional engineers in the industry

In Japan, our Consulting Business is mainly concerned with thestudy and design of public and utility projects. Therefore, its
performance is affected by factors such as investment inconstruction and the scale of public investment. In recent years, thevolume of work has been increasing due to the growing demand fordisaster resilience and extension of infrastructure service life in theface of increasingly severe disasters. In addition, PPPs (PublicPrivate Partnerships) and PFIs (Private Finance Initiatives) are on therise, where public and private sectors collaborate to provide public
services. As a result, the roles of construction consultants are
expanding year by year.

over many years of handling business in a variety offields, and the development of advanced technologies
by utilizing those capabilities

57 NIPPON KOEI GROUP INTEGRATED REPORT 2022

568.0

561.0

556.6

553.8

552.7

500
400
300
200
137.73123.28125.64143.37100.45100.45100
0¥88.5 billion● Revenue increased due to strong performance both in Japan and overseas. Overseas-basedorders for government-related projects and large orders received overseas.
large project operations started, causing the contract utilization rate to rise to a record level.
● Operating profit: Increased due to higher revenue, an absence of one-time losses recorded in

the previous period, and improved profits at Group companies

Key Initiatives of the Medium-term Management Plan Building Resilience 2024
● The Nippon Koei Group is evolving into an organization capable of competing globally by integrating its former Domestic Consulting andDirectionality

International Consulting businesses as well as the Research & Development Center● Conduct business operations through proactive advances and defensive approaches to provide outstanding technology and quality to

the global market

Advancement and global expansion of disasterprevention/mitigation technologies
Key initiatives

Expansion of transportation related businesses● Improve transportation infrastructure and strengthen developmentof areas around transportation hubs

● Maintenance and upgrades of infrastructure to protect people's lives● Utilization of data that contributes to people's peace of mind

● Promote smart cities and next-generation mobility

Promotion of services that contribute to decarbonization

Full-scale expansion into the management field● Strengthen services for global warming countermeasures,● Acquisition of management technology and development ofenvironmental management, and conservation measuresconcession business

Public works spending (initial + revised budget)
Initial(Trillions of yen)
10.0

Revised

Project Information

Strategic business alliance with Institute for Q-shu Pioneers of Space, Inc. in the SAR satellite data business

9.0

In December 2021, we announced a business alliance with theInstitute for Q-shu Pioneers of Space, Inc., a space venture company
created by Kyushu University.
In April 2021, we launched the Satellite Disaster Prevention
Information Service jointly with SKY Perfect JSAT Corporation and
Zenrin, Co., Ltd. as a satellite business. However, we experienced
issues including difficulties in shooting high-definition images athigh frequency of an entire affected area when large-scale,simultaneous disasters occur. To counter this, the creation of asmall SAR satellite constellation, which the Institute for Q-shu
Pioneers of Space, Inc. is working on, will enable high-definition
image data to be taken at high frequency, allowing for the early
identification of actual damage in the event of a disaster andprovision of information for efficient recovery. We will work on theconcrete verification tests according to the condition for acquiring
images that can be analyzed, and aim to develop new satellite
data services and expand the market both domestically and

8.0

7.0

1.6

1.7

1.6
1.0

6.0

5.0

4.0

3.0

6.0

6.0

6.0

6.1

6.1

6.1

2016

2017

2018

2019

2020

2021

2.0

with certified professional engineers in each field● Technical and comprehensive capabilities cultivated551.9

Total overseas consulting business orders● Orders received increased year-on-year in the segment as a whole due to strong domestic

Operating Profit ¥8.9 billion

Director General ofConsulting Operations Headquarters

2.5● No. 1 in sales in Japan in the construction consulting

600

Budget Amount¥98.4 billion

Haruhiko Kanai

3.2

Business Segments Strengths(Billions of yen)
700

Performance Summary for Fiscal Year Ended June 30, 2022

Market Trends (Japan)
Main Business Areas

Status of the Company

ODA budget/Total overseas consulting business orders(industry total)

Review of Operations

Promoting productivity improvement through DX promotion
and service development using new technologies

Review of Operations

1.0

internationally by combining satellite development technology fromthe Institute for Q-shu Pioneers of Space, Inc. with our businessknow-how and ideas in various fields of social infrastructure
construction.

0.0
(FY)

NIPPON KOEI GROUP INTEGRATED REPORT 2022 58

Introduction

Strategy

Urban & Spatial Development Business

Orders
Revenue¥18.2 billion¥22.5 billion

Operating Profit ¥1.5 billion

Aiming for comprehensive urban and regional revitalization
through civil engineering and architecture

Landscape and urban design
Redevelopment planning of districts and buildings in accordancewith development policies, and design of railway lines, urban
development, airport buildings, and station buildings during
infrastructure construction
Refurbishment of historic buildings
Repair and refurbishment of representative historic buildingsin the UK
Civil engineering and architecture
Comprehensive technical consulting service combining Nippon
Koei's civil engineering technology and BDP's architectural
technology
Urban area and smart city development
Provision of one-stop services in the fields of civil engineering,energy, and architecture including research, planning, design, andmanagement

Status of the Company● Orders received decreased year-on-year due to restrained public investment in the U.K. anda trend toward placing smaller orders.
● Revenue increased for both BDP and Quadrangle due to strong progress in on-hand orders● Operating profit decreased as a result of an increase in general and administrative expenses

due to the rebound from the impact of COVID-19 at BDP in the previous fiscal year, and an
impairment of goodwill under IFRS as a result of an increase in the DE ratio due to thebooming stock market.

Key Initiatives of the Medium-term Management Plan Building Resilience 2024

The mission of our Long-term Management Strategy is to operate in the capacity of acomprehensive producer of urban and regional revitalization projects in response to urban
development demand, especially in Asia, including in Japan.
Specifically, the Company will focus on urban (re)development projects, urban restructuring
projects through public-private partnerships, and waterfront area restructuring projects
associated with industrial structural transformation. The goal of the Nippon Koei Group's Urban& Spatial Development Business is to contribute to the creation of sustainable cities and regions
to solve social issues such as population decline and aging, concentration of population in
metropolitan areas, and global warming.
The Nippon Koei Group’s Urban & Spatial Development Business focuses on communities
and public lands. From the perspective of town development, Nippon Koei's strength is that it
can proceed with development not only of buildings in specific areas but also in the dynamic
field of infrastructure including water and sewage, electricity, and transportation networks.

Architecture
Architectural design, structural design, facility design, and interior
design

Review of Operations

Performance Summary for Fiscal Year Ended June 30, 2022

Review of Operations

Main Business Areas

Sustainability/ESG

Directionality● Comprehensive production and development of urban and regional revitalization projects in Japan and overseas● Development of new markets through integrated group operations within the business segment (urban development, smart cities, etc.)

Realization of one-stop services for urban (re)development projects

Full-scale development of urban management field● Acquisition of new urban management businesses, such as PM, CM,● Acquisition of urban area (re)development projects in Japan andoverseas

Key initiatives

Creation of smart city projects with a focus on
decarbonization, safety, and security● Creation of urban spaces taking into account infectious

Noriaki Yoshidadiseases, climate change, and decarbonization● Formation of mobility networks● Creation of people-friendly urban spaces, such as universal

Director General of Urban & Spatial
Development Headquartersand FM, which are expanding

Expansion of BDP market● Expansion of BDP's business in the North American market● Aggressive acquisition of projects in the health care sector● Acquisition of stadium projects and development of adjacentlocations● Promotion of BDP and Nippon Koei collaborations in Asia

design and barrier-free spaces

Market Trends
The architecture field is one of the most active fields, accountingfor 25% of the sales of research and design companies worldwide.
In Asia, Africa, and Latin America, the market for buildings
integrated with transportation-related facilities such as railroads,
roads, and airports, base development integrated with peripheral
infrastructure development, and ancillary surface development andsmart cities is expanding in the urban centers and suburbs ofmetropolitan areas that will serve as receptacles for population
concentration and growth, and the growing industrial economy. In
terms of funding, the appetite for infrastructure investment by theprivate sector is increasing.
In Japan, the market is expanding for the effective use andrevitalization of the large amount of stock (buildings) that exists
nationwide, and for the consolidation and reorganization of highlysustainable bases in regional cities as their populations decline.

Project Information

The Launch of Nippon Koei Urban Space - Integrating civil engineering and architecture

The Company is preparing for the transition to a pure holding
company by July 2023. As part of this reorganization, on July 1,
2022, the Urban & Spatial Development Business of Nippon Koei
Co., Ltd. was transferred to Tamano Consultants Co., Ltd.
through a company split (simple absorption-type split), andNippon Koei Urban Space Co., Ltd. (Representative Director andPresident: Noriaki Yoshida) was established.
Nippon Koei Urban Space will contribute to the creation ofsustainable cities and regions by taking advantage of thetechnologies and experience accumulated by both companies in
the fields of civil engineering and architecture to solve theincreasingly complex urban issues in recent years while being
involved in the comprehensive creation of cities.

Regional Cities

Large Cities

Overseas

Urban Revitalization andHigh-level Use District Development
Human Spaces

Population Growth
Discovery/Development of
New Businesses

Local

GlobalPopulation Decline
Region-specific

Solving Social Issues in the Urban &Spatial Development Field

Regional Development
Civil
Engineering

Architecture

Ranking of 164 survey and design companies- FY2021 sales by field(Unit: 100 million USD)
200

■ Representative joint projects of NIPPON KOEI Co., Ltd. Urban & Spatial Development and Tamano Consultants Co., Ltd.

176.3

150
126.4

Business Segments Strengths

100● Network and customer base shared with of BDP (UK)and Quadrangle (Canada) with leading partners in the
UK and the North America area

46.1
50

architecture fields

29.9

24.7

19.2

● Our unique fusion of the civil engineering and● Advanced technologies including BDP’s BIM

36.0

32.4
5.6

0

re

ctu

hite

Arc

g

urin

act

nuf

Ma

5.4
er

Pow

ter

Wa

ply

Sup

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ast

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Sew

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ust

Ind

tion

orta

nsp

Tra

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Har

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Oth

Tokyo Metropolitan Meiji Park - Park-PFI
Increasing added value through urban management initiatives

Expo 2005 Aichi Commemorative Park
Providing one-stop services from the concept to operational support stages* Excerpt from the August 2022 Issue of ENR

59 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 60

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Performance Summary for Fiscal Year Ended June 30, 2022

Review of Operations

Energy Business

Orders

¥14.3 billion

Revenue¥18.7 billion

Operating Profit¥1.2 billion● Orders received increased year-on-year due to large order acquisition, and the gradualcontribution of improvement of factory production capacity, and elimination of delays insemiconductor procurement● Revenue increased due to systematic progress in order backlog accumulation and progress in

EPC for energy storage projects in Europe● Operating profit increased compared to the previous fiscal year due to cost control in the

manufacturing sector and provision for loss on construction contracts

Promoting the provision of one-stop services
in new energy markets

Key Initiatives of the Medium-term Management Plan Building Resilience 2024

The Energy Business provides development and operation of hydroelectric power plants andsubstations, consulting, equipment manufacturing, and construction as services. In recent years,
we have provided these services as a one-stop service and are working to reduce the burden on
the order side and provide value that cannot be imitated by other companies in terms of speed.
Additionally, we provide energy management services using storage batteries in markets where
the introduction of renewable energy is progressing, such as Europe.
Around the world, decentralized energy resources are being introduced and businesses are
shifting to renewable energy, and a new market for power trading is being created in Japan aswell. We see business opportunities here, and, while keeping a close eye on market trends, will
establish new businesses, create a one-stop energy storage service, and conduct cross-sales incooperation with other segments as a unified group.
As a business that directly contributes to climate change countermeasures, we will actively
take on the challenge of moving into new markets while maintaining high aspirations and a broad
perspective as we solidify our foundation.

Directionality

structure of the consulting and engineering businesses

Establish foundation for power generation and energy
management business

Strengthen manufacturing of core products and develop
new products● Respond to overseas needs for decarbonized electricity● Contribute to the stable supply of electricity and resilience● Entry into the renewable energy aggregator business by utilizing

Key initiatives

Hiroshi Yokota

the FIP scheme● Expansion of energy businesses owned and operated by the company● Construction of energy systems for local production and local
consumption, improvement of disaster prevention capabilities,
and realization of new value-added services● Stabilization of electric power systems that primarily use
renewable energy

improvement

Provide one-stop solutions utilizing diversified and diverse
technologies● Strengthen structures of the consulting and engineeringbusinesses

Director General of Energy Headquarters

Project Information

Main Business Areas

Business Segments Strengths

Manufacture of equipment and devices
Manufacture of various types of water turbines for hydroelectric
power generation, manufacture of substation control equipment,
and construction of centralized substation monitoring systems anddam management systems● One-stop services encompassing every stage from

Mechanical and electrical consulting
Comprehensive consulting services for domestic and international
electric power and mechanical and telecommunications fields,
energy engineering including EPC● Creation of foundation for power generation and energy management business● Stabilization of manufacturing businesses by strengthening core products and developing new products, and strengthening of theplanning and surveying for electric power operations
and electrical equipment to engineering andconstruction as well as equipment manufacture andmaintenance in Japan and overseas. Speedy response
and reduction of the burden on the order side.
● Provides a wide range of services due to collaboration

Supplying 100% renewable electricity derived from our own hydroelectric power to three of our company locations
Non-Fossil
Fuel Certificate

Power
Generation
Business

Retail Electricity
Business

Renewable
Electricity
Suidoyama
Shitoki Dam
Hydropower Station Hydropower Station

Aggregatorwith our engineering consulting business

The aggregation system was developed
in-house with know-how gained inEurope applied to the Japanese system

Company Locations
Non-Fossil
Fuel Certificate
Renewable
Electricity
R&D Center

Supply/Demand
Imbalance Settlement

FIP Premium

Wide-area
Organization/General
Power Distribution
Business

Head Office

Manufacturing Plant(Fukushima)● Many years of experience in product delivery andGeotechnical surveying, sale of civil engineering measurement
devices
Installation, maintenance, and inspection of automatic observation
systems for slope disaster prevention, and manufacture and salesof ground measurement equipment

construction for major power companies● Business bases and capital and business alliances withstartup firms in Europe, a forerunner in electric power
market liberalization, and a track record in the energy
management business

Construction of electrical facilities
Planning, investigation, design, construction, and management of
substations, power plants, and other facilities for reinforcement
and renovation
Energy solutions
Consulting service for improving the efficiency of energy use
Energy management related products
Manufacture and sale of EMS, in-house energy storage systems,
and microgrid aggregation systems
Overseas energy management
Investment in ancillary services business, etc. in Europe, New
business development and business promotion
Domestic power generation
Development of hydroelectric power facilities and sale of electricity
through the operation of eight domestic hydroelectric power plants
Domestic energy management
Renewable energy monitoring, renewable energy efficiency, andenergy conservation consulting services

61 NIPPON KOEI GROUP INTEGRATED REPORT 2022

Market Trends
The Japanese electric power market is expected to shift to a newcompetitive environment with the separation of electric power
production and distribution and the complete liberalization of power
generation, transmission, distribution, and retail. At present, we areworking to strengthen our production system and earnings
management to meet the cost reduction demands of powercompanies. Expanding demand in the global market for renewableenergy accompanying the drive for low-carbon operations anddistributed power sourcing. In line with this, it also anticipates the
expansion of new markets for ancillary services, peak arbitrage,
capacity markets, etc.

As part of our energy management efforts, we are promoting aplan to use 100% renewable electricity at three of our company
locations. In preparation for this plan, we are applying to have twohydroelectric power plants in Fukushima that we operate to
become part of the FIP (feed-in-premium) scheme* and are also
applying for aggregator licenses for these facilities.
The timing of the start of this project will be determined while
monitoring the status of license approval and market price trends.
Project Information

At first, we will build our own self-sufficiency model for electricity.
For the future, we are aiming to be responsible for aggregating
FIP power sources from other companies and supplying
renewable energy power sources for local production and local
consumption.
*A scheme in which a subsidy is added as a premium when electricity generated by renewable energy
companies is sold on the wholesale electricity trading market or through negotiated transactions.

Large-Scale Battery Storage Project Construction Begins in the UK and Belgium

Nippon Koei Energy Europe (NKEE), our European subsidiarylocated in the Netherlands, plays a central role in the Group'sbusiness utilizing grid-use storage batteries in Europe, where therenewable energy market is leading the way. We are currently
working on a large-scale grid storage battery project in Belgium(25MW/100MWh) and two projects in the UK (totaling
approximately 100MW/130MWh). Construction will continue until
early 2023, after which the control systems manufactured by
Nippon Koei will be used to provide grid stabilization services(ancillary services) and other services to major power companies
in each of those country.
Through each project, we will accumulate and improve ourexpertise in one-stop service-based energy management using
grid storage batteries, which we will then apply to power
generation, transmission, and distribution projects in Japan. We

will also enhance our ability to propose a variety of storage battery
solutions to expand the introduction of renewable energy in Japanand abroad, and to enhance sophistication and efficiency ofenergy use.

Ruien Power Storage Station in Belgium

NIPPON KOEI GROUP INTEGRATED REPORT 2022 62

Introduction

Board of Directors, Executive Officers andAudit & Supervisory Board Members (as of September 29, 2022)

Newly appointed

OutsideStrategy

Sustainability/ESG

Review of Operations

Status of the Company

Independent

Note: Each work history section only list the most important
events in the individual’s work history.

Director

Director and Chairman

Representative Director and President

Ryuichi Arimoto

Hiroaki Shinya

1977
2009

2011

2014
2021

Joined the Company
Director and Executive Officer
Director General of Corporate Headquarters andGeneral Manager of Corporate Planning
Department
Director General of Corporate Headquarters andGeneral Manager of Personnel Personnel &General Affairs Department
Representative Director and President
Director and Chairman (current position)

1985
2017

2018
2020

2021

Joined the Company
Director and Executive Officer
Director General of Domestic Consulting
Operations
Director and Managing Executive Officer
Director and Senior Managing Executive Officer
Director General of Consulting Operations
Headquarters Executive Officer in charge of Urban& Spatial Development
Representative Director and President(current position)

Director and Vice President/In charge of Sustainability, NKG
Global Expansion, and Health and Productivity Management

Takayasu Tsuyusaki
1979
2017

2019
2020
2021
2022

Joined the Company
Director and Managing Executive Officer
Director General of Global Strategy Headquarters,
General Manager of Business Development Office,and General Manager of Singapore OfficeDirector and Senior Managing Executive Officer
Director General of Business Promotion Headquarters
Director and Executive Vice President
Director and Vice President (current position)
In charge of Sustainability, NKG Global Expansion,and Health and Productivity Management(current position)

Director Outside Independent

Director Outside Independent

Director Outside Independent

Hiizu Ichikawa

Kazumasa Kusaka

Yoko Ishida

1970
1993
1996
1997
1999
2001
2004
2010
2014

Joined The Mitsubishi Bank, Ltd.
General Manager of Singapore Branch of The
Mitsubishi Bank, Ltd.
General Manager of Industrial Research
Department of The Bank of Tokyo-Mitsubishi, Ltd.
General Manager of Sales Screening Departmentof The Bank of Tokyo-Mitsubishi, Ltd.
Senior Executive Director of The Resolution andCollection Corporation
Senior Executive Director of Chiyoda Corporation
Representative Director and Managing Director of
Mitsubishi Motors Corporation
Representative Director and Executive Vice
President of Mitsubishi Motors Corporation
Outside Corporate Auditor of The Hyakugo Bank, Ltd.
Outside Director of the Company (current position)

1970
1984

2001

2002
2003
2004
2006
2007
2008
2009
2011
2013

2015
2021

Audit & Supervisory Board Member

Representative Director and Senior Managing Executive Officer/
Director General of Consulting Operations Headquarters

Haruhiko Kanai
1982
2017

2019

2020
2021

Joined the Company
Director and Managing Executive Officer
Director General of International Consulting
Operations
Director and Managing Executive Officer
In charge of Technology Headquarters and Director
General of International Consulting Operations
Acting Director General of Consulting Operations
Headquarters
Representative Director and Senior Managing
Executive Officer (current position)
Director General of Consulting Operations
Headquarters (current position)

Representative Director and Senior Managing Executive Officer/
Director General of Urban & Spatial Development Headquarters/
Representative Director and President of Nippon Koei Urban Space Co., Ltd.

Noriaki Yoshida
1980
2014

2018
2019
2020
2021
2022

Joined the Company
Executive Officer
Director General of Domestic Consulting
Operations and General Manager of InfrastructureManagement Department
Deputy Director General of Domestic Consulting Operations
Managing Executive Officer
General Manager of Urban & Spatial Development BusinessDirector General of Urban & Spatial Development
Headquarters (current position)
Director and Managing Executive Officer
Representative Director and Senior Managing
Executive Officer (current position)
Representative Director and President of Nippon Koei
Urban Space Co., Ltd. (current position)

1985
2017

2018
2020

Joined the Company
Director and Executive Officer
In charge of IR and Director General of Corporate
Headquarters
General Manager of the 75th Anniversary
Secretarial OfficeDirector and Managing Executive Officer(current position)
Director General of Corporate Headquarters(current position)

Full-time Audit & Supervisory Board
MemberFull-time Audit & Supervisory Board
Member Outside Independent

Yoshizo Goto

Kunio Okamura

1982
2011

2015

2018

Joined the Company
General Manager of Revenue
Management Office and General
Manager of Compliance Office,International Consulting
Operations
General Manager of Corporate
Auditing Office
General Manager of Internal
Auditing Office
Deputy Director General ofInternational Consulting
Operations
Audit & Supervisory Board
Member (current position)

1979
2008

2012

2015

2016

2019

Tomohisa Fukuoka

Hiroshi Yokota

1988
2018

2020

2021
2022

Joined the Company
Executive Officer
General Manager of Infrastructure Engineering Operations,
Domestic Consulting Operations
Managing Executive Officers
Deputy Director General of Consulting Operations Headquarters andDirector General of Infrastructure Engineering Operations
Director and Managing Executive Officer (current position)
Acting Director General of Consulting Operations
Headquarters (current position)

63 NIPPON KOEI GROUP INTEGRATED REPORT 2022

1982
2016
2018
2020

2022

Joined the Company
Executive Officer
Deputy Director General of Domestic Consulting Operations
General Manager of Energy Business
Managing Executive Officer
Director General of Solution Operations, Energy Headquartersand
General Manager of Development & Operation Division
Director and Managing Executive Officer (current position)
Director General of Energy Headquarters (current position)

1997
2006
2010
2015

2016
2017
2018
2020

2021
2022

Yasushi Hirusaki

2014

Director and Managing Executive Officer/
Director General of Energy Headquarters Newly appointed

Head of Corporate Planning Department, System Science
Consultants Co., Ltd.
Head of Project Department No. 2, KRI International Corp.
Head of Evaluation Business Department, International
Development Center of Japan
Executive Director, International Development Center of Japan
Head of Evaluation Business Department, International Development Center of Japan
Director, The Japan Nepal Society (current position)
Director, International Development Center of Japan (current position)
Professor, Center for the Study of International Cooperation in Education, Hiroshima University
Cooperating Faculty, Education Culture Course, Graduate School forInternational Development and Cooperation, Hiroshima University
Deputy Executive Director, Hiroshima University (current position)
Director, The Japan Society for International Development
Vice President and Executive Director, The Japan Evaluation
Society (current position)
Director, International Education Development Program, Division of
Educational Sciences, Graduate School of Humanities and Social
Sciences, Hiroshima University (current position)
Outside Director of the Company (current position)
Auditor, The Japan Society for International Development (current position)
Director, Center for the Study of International Cooperation in
Education, Hiroshima University
Professor, Center for the Study of International Cooperation in Education,
the IDEC Institute, Hiroshima University (current position)

1991

Director and Managing Executive Officer/In charge of IR and
Director General of Corporate Management Headquarters

2013

Director and Managing Executive Officer/
Acting Director General of Consulting Operations Headquarters

Joined Ministry of International Trade and Industry (MITI)MITI Energy Minister of the International Energy
Agency (IEA) of the Organization for Economic
Co-operation and Development (OECD)
Director-General, Industrial Science andTechnology Policy and Environment Bureau,
Ministry of Economy, Trade and Industry (METI)
Director-General, Trade Policy Bureau, METI
Commissioner of Agency for Natural Resources
and Energy, METI
Vice-Minister for International Affairs, METI
Adviser, Dentsu Inc.
President of Japan Cooperation Center for the Middle East
Special Advisor to the Cabinet
Senior Vice President of Mitsubishi Electric Corporation
Visiting Professor of Graduate School of Public
Policy, The University of Tokyo
President of the Foundation for International Tradeand Industrial Co-operation
Chairman of Japan Economic Foundation
Outside Director of the Company (current position)
Adviser, Japan Economic Foundation (current position)
President of the Institute for International Trade andInvestment (current position)

Executive Vice President
Yuichi Ishikawa

Audit & Supervisory Board Member

Naoki Honjo

Joined Overseas Economic
Cooperation Fund
Director General of Operations
Strategy Department, Japan
International Cooperation Agency
Senior Special Advisor of theJapan International
Cooperation Agency
Ambassador Extraordinary andPlenipotentiary of Japan to the
Republic of Cameroon andRepublic of Chad, Ministry ofForeign Affairs of Japan (MOFA)
Ambassador Extraordinary andPlenipotentiary of Japan toCentral African Republic
Outside Audit & Supervisory
Board Member of the Company(current position)

1978
2011

2014

2015
2017
2018

Joined the Company
Executive Officer
Deputy Director General of
Corporate Management
Headquarters and General
Manager of Finance &Accounting Department
Director and Executive Officer
Acting Director General of
Corporate Management
Headquarters and General
Manager of Finance &Accounting Department
Acting Director General of
Corporate Headquarters
Director General of Corporate
Headquarters
Special Adviser
Audit & Supervisory Board
Member (current position)

Audit & Supervisory Board Member Outside
Independent

Yoshiko Koizumi
1972

1980
2000
2003
2007
2008
2009
2012
2013
2015

2016
2017

Registered in bar association (The Daini Tokyo Bar
Association)
Joined Kikuchi Law and Patent OfficePartner at Masuda & Ejiri Law Office(current Nishimura & Asahi)
Chair of Women Business Lawyers Committee,
Inter-Pacific Bar Association (IPBA)
Expert member of Food Safety Commission of Japan
Auditor at Bosch CorporationCounsel at Nishimura & Asahi
Partner at City-Yuwa Partners (current position)
Deputy Chair of the Government Procurement Review Board
Director of the Japan Bar Association(current position)
Outside Director of Taiheiyo Cement Corporation(current position)
Outside Director of Dowa Holdings Co., Ltd. (current position)
Outside Auditor of Sumitomo Bakelite Co., Ltd.
Outside Audit & Supervisory Board Member of theCompany (current position)

Managing Executive Officers
Ken Nishino Hiroshi Matsuda Yasusuke Kurosaki Hideo Tamura

Executive Officers
Kevin Tynes
Hiroyuki Yamate Noriyuki Nakashima Toru Nakagawa
Tadahisa Matsunaga Shinichi Mizokuchi Shinji Ishikawa
Kazuhiro Ibayashi

Michio Hasegawa
Naoki Kudo

Takuro Hamanaka Katsuya Fukasaku Masaru Onodera
Osamu Katsuyama Yoshikazu Takahashi
Minoru Uemoto
Tomoo Tomoda
Nobuyuki Shibasaki Shinichi Suetake Keita LeeNIPPON KOEI GROUP INTEGRATED REPORT 2022 64

Introduction

Strategy

Sustainability/ESG

Review of Operations

Status of the Company

Consolidated Financial Data
(Millions of yen)Japanese GAAPFYE March 2013
Profit and Loss Statement
Orders
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income (loss)
Ordinary income
Extraordinary income/loss
Income taxes
Profit attributable to owners of parent
Consolidated Balance Sheet (end of period)
Total assets
Current assets
Cash and deposits
Non-current assets
Property, plant and equipment
Intangible assets
Goodwill
Investments and other assets
Investment securities
Total liabilities
Current liabilities
Short-term loans payableNon-current liabilities
Long-term loans payable
Total net assets
Consolidated Statement of Cash Flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Segment information
Domestic Consulting Business
International Consulting Business
Power Engineering Business
OrdersUrban & Spatial Development Business
Energy Business
Other
Domestic Consulting Business
International Consulting Business
Power Ensgineering Business
Urban & Spatial Development BusinessNet sales
Energy Business
Real Estate Business

OperatingprofitFYE June 2014

FYE June 2015IFRS

FYE June 2016

FYE June 2017

FYE June 2018

FYE June 2019

FYE June 2021

FYE June 2022

71,13472,411
52,741
19,66915,027
4,642
443
5,086
ー
2,201
2,849

92,48579,19359,253
19,93915,683
4,256
286
4,542
19
1,530
2,998

87,573
81,83960,054
21,785
17,283
4,502
975
5,477
2,086
3,266
4,261

104,019
81,86559,50522,35917,636
4,723
(357)
4,365
(333)
2,178
1,823

117,442
101,338
70,40030,93725,472
5,464
493
5,958
(764)
1,870
3,288

104,350
106,023
73,66432,35925,797
6,561
159
6,721
443
2,556
4,555

118,085
108,589
75,62732,962
27,851
5,110
473
5,584
ー
2,180
3,318

Orders
Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Financial profit (loss)
Profit before tax
Profit attributable to owners of parent

144,871
108,441(75,202)33,238(28,436)
5,245
(216)
5,029
3,246

133,304
117,859(80,124)
37,735(29,173)
7,128
48
7,176
4,518

131,166
130,674(89,975)
40,699(31,610)
9,065
1,734
10,8006,704

84,79550,431
6,661
34,36323,248
1,189
618
9,925
8,106
37,86631,313
9,000
6,553
520
46,92876,14436,7498,967
39,394
26,588787
232
12,0199,210
28,30920,528
100
7,780
1,690
47,835

84,11044,82012,14839,28924,525570
ー
14,193
9,861
31,12824,466
ー
6,662
1,526
52,981

100,989
46,153
11,17454,836
24,561
16,620
10,312
13,654
8,285
49,52943,107
16,0006,421
1,260
51,460113,865
54,79819,59359,067
24,535
13,9008,685
20,63010,491
58,991
30,341
ー
28,65021,41354,874

113,890
54,263
16,392
59,626
27,624
12,964
8,185
19,037
9,176
54,44028,441
ー
25,99918,93459,449113,175
52,44613,14760,72829,882
13,501
8,193
17,345
7,228
52,96928,082
ー
24,886
17,63960,205

Total assets
Current assets
Cash and cash equivalents
Non-current assets
Property, plant and equipment
Goodwill
Intangible assets
Other financial assets
Investments accounted for using equity method
Total liabilities
Current liabilities
Borrowing
Non-current liabilities
Borrowing
Total equity

147,408
62,027
15,47285,38042,039
7,964
5,480
6,721
1,974
81,68749,963
15,77831,723
14,92365,721

156,137
68,57017,83887,566
40,832
9,182
6,502
7,434
2,077
83,84348,8898,320
34,95318,712
72,294

173,926
83,535
17,971
90,39041,403
10,207
7,025
6,423
2,434
91,95655,84013,14836,116
19,28881,9693,372
236(3,084)
93
618
5,922
6,578

1,340
(4,559)62
8(3,148)
11,613
8,465

881
2,702
(745)
103
2,942
8,465
11,673379(17,705)
15,199(146)(2,272)
11,6739,400

6,376(4,172)
4,846
(124)
6,925
9,400
17,083(602)
977(3,062)(22)(2,709)17,083
15,233

3,109(3,504)(1,936)(309)(2,641)
15,233
12,663

Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in cash and cash equivalents
Effect of exchange rate change on cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

4,365(7,129)
4,529
1,765
465
12,663
15,472

12,073(2,750)(7,928)1,395
970
15,472
17,8384,820(6,949)
1,892
(235)
369
17,83817,971

38,423
20,146
12,541ーー
23
35,547
18,63815,929ーー
1,130

46,61730,023
15,831ーー
13
41,817
20,947
14,169ーー
1,125

45,05728,88913,595ーー
30
41,845
20,174
17,857ーー
821

44,10925,936
14,716
16,251ー
64
40,77822,07017,522ーー
514

48,265
41,57314,087
13,460ー
55
43,51624,491
17,577
14,347
ー
473

48,52926,716
15,943
12,855179
126
46,59528,88915,762
13,040354
440

52,85528,482
15,411
20,510723
100
49,59324,928
16,531
15,359719
439

OrdersConsulting Business
Urban & Spatial Development Business
Energy Business
Other106,931
17,874
19,98679

97,76921,457
13,991
86

98,491
18,207
14,343
123

Revenue

Consulting Business
Urban & Spatial Development Business
Energy Business
Other

72,594
18,142
16,452
1,251

80,09820,274
16,621
865

88,51022,58018,799783

OperatingprofitConsulting Business
Urban & Spatial Development Business
Energy Business
Other

5,457
1,759
640
(2,611)

6,126
2,266
814
(2,079)

8,982
1,588
1,290
(2,796)

Other

1,165

1,133

1,141

979

931

940

1,016

Domestic Consulting Business
International Consulting Business
Power Engineering Business
Urban & Spatial Development Business
Energy Business
Real Estate Business
Other

1,165
1,340
1,979
ー
ー
846
(689)

2,502
658
1,267
ー
ー
818
(991)

2,723
285
2,834
ー
ー
584
(1,925)

2,956
1,156
3,048
ー
ー
386
(2,824)

3,298
1,887
2,683
81
ー
401
(2,886)

4,279
2,649
1,873
173
(18)
403
(2,799)

4,990
841
2,089
151
(365)
409
(3,006)* The fiscal year ending June 30, 2013 is an irregular fiscal year (3 months) due to a change in the fiscal year end, so this information has been omitted.
* Orders for the 4th quarter of the fiscal year ended June 30, 2016 include BDP’s outstanding orders (16.251 billion yen) as of April 1, 2016.
* Effective from the fiscal year ending June 30, 2017, the basis for calculating orders received was changed to a method that excludes differences due to foreign currency calculation.
* Due to the change in BDP's fiscal year end for the fiscal year ending June 30, 2017, BDP's results for the 15-month period from April 2016 to June 2017 have been consolidated.
* In the fiscal year ended June 2018, the Nippon Koei Group changed its basis for recording sales from the completed-contract method to the percentage-of-completion method.
* For the fiscal year ending June 30, 2020, the correction dated December 14, 2020 has already been reflected.
* International Financial Reporting Standards (IFRS) have been applied from the end of the fiscal year ended June 30, 2021.

65 NIPPON KOEI GROUP INTEGRATED REPORT 2022

FYE June 2020

* The Company has been conducting business in three business segments since FYE June 2022. For the Consulting Business, we combined our domestic and overseas consulting businesses and combined our former Power Engineering andEnergy Business to form our current Energy Business. Since Real Estate Leasing is no longer a company business segment, it has been included in “Other”.
* Consulting Business figures for the fiscal year ended June 30, 2020 are simple totals for the Domestic Consulting/International Consulting businesses before elimination of internal transactions.
* Energy Business figures for the year ended June 30, 2020 are simple totals of the Power Engineering Business and Energy Businesses before elimination of internal transactions.
* PT. Cikaengan Tirta Energi was reclassified from an Energy Business segment company to a Consulting Business segment company, and Aichi Tamano Information System Co., Ltd. was reclassified from a Consulting Business segment company
to listed under the “Other” segment in the fiscal year ended June 30, 2022. The figures for the fiscal year ended June 30, 2021 are also prepared based on the new reportable segment classification.

NIPPON KOEI GROUP INTEGRATED REPORT 2022 66

Strategy

Sustainability/ESG

Organizational Structure

Corporate Data (as of June 30, 2022)(as of January 01, 2023)

Corporate Data
Corporate name

Review of Operations

Status of the Company

Business Incubation Division

Business Promotion
Headquarters

Introduction

Jakarta Office
Manila OfficeHanoi Office
Bangkok Office
Yangon Office

Shareholder Distribution

Singapore OfficeTreasury stock

Nippon Koei Co., Ltd.
Securities companies

Registeredaddress

5-4 Kojimachi, Chiyoda-ku,
Tokyo 102-0083, JapanPhone

03-3238-8030

Representative

Hiroaki Shinya, Representative Director andPresident

Colombo Office

0.01%

3.78%

National and local governments

New Delhi Office

0.00%

Dhaka OfficeIstanbul Office

Domestic companies

Nairobi Office

9.05%

Lima OfficeForeign investors

Compliance OfficeFinancial institutions

11.33%

Marketing Division

40.97%

Operations Division
Contract Division

Established

June 7, 1946

Capital stock¥7,517,131,641 (As of October 28, 2022)

Corporate Planning Dept.

Audit & Supervisory
Board Member

Stock Information
Number of sharesauthorized
Number of shares issued
Number of shareholders
Fiscal year-end

3

Custody Bank of Japan, Ltd. (Trust
Account)
The Koei Employees’ Stockholders
Association

2151
1054

14.3
7.0

1018

6.8

739

4.9

38,000,000
4 MUFG Bank, Ltd.
5 Meiji Yasuda Life Insurance Company

15,060,314
6,832

6 GOVERNMENT OF NORWAY

564
387

3.8
2.6

June 30
7 Mizuho Bank, Ltd.

Stock listing

Tokyo Stock Exchange(Prime Market)

Securities code

382

2.5

368

2.4

9 Mizuho Securities Co., Ltd.

305

2.0

10 Oyo Corporation

220

1.5

8

Custody Bank of Japan, Ltd.
(Pension Trust Account)

1954

Transfer agent

Mizuho Trust & Banking Co., Ltd.

Corporate Management
Headquarters

Center for
Information
Infrastructure

Information Management Dept.

Center for
Accounting &General Affairs

Accounting and Tax Department
General Affairs &Administration Department
Business Support Department

Private Sector Consulting Division

R&D Center

Center for Advanced ResearchInformation Systems Dept.
Center for Business Creation
CIM Technical Center
Center for Technology Development

Digital Innovation
Division.

Testing & Experiment Center

Digital Business Dept.
Digital Technology Dept.
Digital Transformation Dept.
Technology Planning Department
Human Resources Planning
Department

Watershed & Water
Management Operations
Consulting Operations Headquarters

2

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

Business Strategy
Headquarters

1

Legal & Compliance Department

Documents Office

Board of Executive Officers

6,163 (consolidated),
2,663 (non-consolidated)

Shares Owned Percentage of(ThousandTotal Sharesshares)Owned

Total Risk Management Council

Major Shareholders(Top 10 by Shares Owned)

Board ofDirectors

Number of
employees

Major Shareholders (Top 10 by Shares Owned)

Management Council

Domestic Consulting, International Consulting,Power Engineering, Urban & Spatial
Development, Energy

HR & Technical Management Division

Human Resources Department

President

34.86%

Nominating and Compensation
Advisory Committee

Business areas

Technical Quality & Safety DivisionCorporate Communication Office

Audit & Supervisory
Board

Individuals and others

Internal Auditing OfficeRiver & Water Resources Division
Sustainable Regional Development Division
Water Environment Division

Transportation
Operations Headquarters

Road Division
Port & Airport Division
Transportation Policy & Planning Division

Railways Operations
Headquarters

Railway Division

Land Infrastructure
Development Operations
Headquarters

Geohazard Management Division
Defense Infrastructure Development Division

Technical Auditing Office

Infrastructure
Engineering Operations

Global Environment Division
Social System Division
Geoenvironment Division
Satellite Information Service CenterTokyo Branch Office
Sapporo Branch OfficeSendai Branch OfficeNiigata Branch Office
Nagoya Branch Office

Stock Price(Yen)

Closing price (left scale)

Trading volume (right scale) (Thousand shares)

4,500

1,800

4,000

1,600

3,500

1,400

3,000

1,200

2,500

1,000

2,000

800

Osaka Branch OfficeUrban & Spatial Development
Headquarters

Note: The percentage of total shares owned is calculated using 15,058,503 shares as the denominator,
which is the total number of shares issued (15,060,314 shares) less treasury stock.

Hiroshima Branch Office
Shikoku Branch Office
Fukuoka Branch Office
Okinawa Branch Office

Technical Auditing OfficeCompliance OfficeBusiness Planning Office
Operations Planning Office

1,500

600

1,000

400
200

500

0

0
6 7

7
2018

6 7
2019

67 NIPPON KOEI GROUP INTEGRATED REPORT 2022

6 7
2020

6 7
2021

6
2022

Energy Headquarters

Safety, Quality & Environment Control OfficeBusiness Strategy
Headquarters

Business Development OfficeBusiness Strategy Headquarters

Solution Operations
Headquarters

Construction Engineering Division
Plant Engineering Division
Energy Operation Division

Power & Digital
Operations
Headquarters

Operations Dept.
Marketing Division

Materials Procurement Office

System Division

Safety & Environment Control OfficeElectromechanical Division

Quality Assurance Dept.

Yokohama Engineering Center

Research & Development Office(FY)

NIPPON KOEI GROUP INTEGRATED REPORT 2022 68

History

Main Domestic Bases of Nippon Koei

Network (as of December 31, 2022)

1946 Nippon Koei established in Chiyoda-ku, Tokyo
1954 Received order for planning of Baluchaung

Sapporo Branch OfficeHydropower Plant in Burma (Company’s firstoverseas project)

1958 Acquired Nikki Manufacturing Co., Ltd.

BDP Holdings Manchester
Nippon Koei Bangladesh

Naypyidaw(name changed to Nikki Corporation in July
1982, currently a consolidated subsidiary)

Okinawa Branch Office

Nippon Koei Energy Europe
Dhaka

Niigata Branch Office
Hiroshima Branch Office

Vientiane
Hanoi
Phnom Penh

Shares listed in the Second Section of the Tokyo
Stock Exchange

Power & Digital
Business Unit
R&D Center

Fukuoka Branch
OfficeQUADRANGLEARCHITECTS

Ho Chi Minh City
Head Office /Kojimachi Office /Tokyo Branch Office
Nippon Koei Urban
Space Co., Ltd.

ShanghaiRuien Energy Storage

1963 Tokyo Stock Exchange

Sendai Branch Office

Bangkok

Nippon Koei India
LondonShikoku Branch OfficeIstanbul

1978 New head office building completed in Kojimachi,
Tokyo; relocated head office; listing moved to theFirst Section of the Tokyo Stock Exchange
Listing moved to the First Section of the Tokyo
Stock Exchange

1986 Koei System Inc. established

Osaka Branch Office

New York(currently a consolidated subsidiary)

1989 Philkoei International, Inc. established in the

Nagoya Branch Office

Philippines (currently a consolidated subsidiary)

Rabat

Amman

Tunis

Baghdad1992 PT. Indokoei International established in

Philkoei International

New Delhi

Nippon Koei LAC
Medellin
PalmasIndonesia (currently a consolidated subsidiary)
El Koei Co., Ltd. established(currently a consolidated subsidiary)

Manila1995 KRI International Corp. established

NIPPON KOEILATIN AMERICA-CARIBBEAN,
MEXICO

Colombo2003 Nippon Koei Latin America-Caribbean Co., Ltd.
established (currently a consolidated subsidiary)
Tamano Consultants Co., Ltd. becomes a
subsidiary (currently a consolidated subsidiary)

YangonMyanmar Koei

Koei Africa
Nairobi

San Salvador

Quito
Guayaquil

Nippon Koei Vietnam International

2005 Tamano Consultants Co., Ltd. becomes a

Lima

ASAP Mobility

subsidiary (currently a consolidated subsidiary)

Cochabamba

Ironmont Hydro
Offices (Nippon Koei)

Singapore Ofﬁce

Liaison Offices (Nippon Koei)

Jakarta

Group Companies

Indokoei

MaputoNippon Koei Mozambique

Asuncion

Offices (Group Companies)

Cikaengan Tirta Energi

Branch Offices / Research Centers / Sites

NIPPON KOEILAC DO BRASIL
Sao Paulo

OfficesHead Office / Kojimachi Office /Tokyo Branch Office2007 Nippon Koei LAC do Brasil Ltda. established in
Brazil (currently a consolidated subsidiary)

2008 Nippon Koei India Pvt. Ltd. established in India(currently a consolidated subsidiary)2010 NKLAC, Inc. established in Panama(name changed to Nippon Koei LAC, Inc. in
September 2011)2012 Nippon Koei Vietnam International Co., Ltd.
established (currently a consolidated subsidiary)2013 Myanmar Koei International Ltd. established in
Myanmar (currently a consolidated subsidiary)

Major Group Companies (Consolidated Subsidiaries)

2015 KOEI Energy Co., Ltd. established(currently a consolidated subsidiary)

Consulting Business

Urban & Spatial Development Business

Energy Business

Other● Nippon Koei Urban Space Co., Ltd.

● Koei System Inc.

● Nikki Corporation● Tamano Ecost Co., Ltd.

● Koei Energy Co., Ltd.

● Aichi Tamano Information System Co., Ltd.

● Nippon Koei Energy Europe B.V.

● Nippon Koei Australia Pty. Ltd.

● Nippon Civic Consulting Engineers Co., Ltd.

● Nippon Koei Bangladesh Ltd.

● El Koei Co., Ltd.

● Nippon Koei Vietnam International Co., Ltd.

● Geoplan Namtech Inc.

● Philkoei International, Inc.

● Koei Research & Consulting Inc.

● Pt. Indokoei International● Nippon Koei Latin America-Caribbean Co., Ltd.

● Myanmar Koei International Ltd.

● Nippon Koei Lac, Inc.

● Koei Africa Company Limited● Nippon Koei Latin America● Pt. Cikaengan Tirta Energi- Caribbean, Mexico S. De R.l. De C.V.
● Nippon Koei Lac Do Brasil Ltda.
● Nippon Koei Mozambique, Ltda.
● Nippon Koei India Pvt. Ltd.

● Asap Mobility Sdn. Bhd.

● Cuxton Energy Storage Limited● Pt. Iki-Toyo● Ruien Energy Storage NV● Kisho Kurokawa Architect & Associates Co., Ltd.
● Nakaze Kamp Co., Ltd.

● Rnk Uk Investments Limited● BDP Holdings Limited● Tollcux Investments Limited● Building Design Partnership Limited● Tollcux Finance Limited● Quadrangle Architects Limited● Tollgate Energy Storage Limited

2016 UK-based architectural design company BDP
Holdings Limited becomes a subsidiary(currently a consolidated subsidiary)2017 Koei Research & Consulting Inc. established(Koei Research Institute International Corp. and
System Science Consultants Co., Ltd. merged)

2018 Nippon Koei Bangladesh Ltd. Established in
Bangladesh

2019 Canada architectural design company
Quadrangle Architects Limited becomes a
subsidiary (currently a consolidated subsidiary)2020 New head office building completed in Kojimachi,
Tokyo (reconstruction)

2021 75th Anniversary Project Implemented
2022 Nippon Koei Urban Space Co., Ltd. launched

69 NIPPON KOEI GROUP INTEGRATED REPORT 2022

NIPPON KOEI GROUP INTEGRATED REPORT 2022 70