Editing Policy
In this report, we have included content that has major interest or
significance for our stakeholders and which is extremely importantfor SG Holdings Group, based on our newly identified “priority
challenges in CSR.” This time in particular features logistics efficiency
solutions that aim to save energy and reduce the environmental
burden in Vietnam, which is one of our international logistics sites,
as well as in other aspects of logistics.

SG Holdings Group Corporate Philosophy

Reference Guidelines“Trust, Create, Challenge”

Ministry of the Environment, “Environmental Reporting Guidelines
2012”
GRI* “Sustainability Reporting Guidelines (4th Edition)”
ISO26000 (Guidance on Social Responsibility)*GRI: Abbreviation of Global Reporting Initiative. An international
independent standards organization whose goal is to create
international guidelines for sustainability reports and makethem widely known.

The SG Holdings Group will:- Earn the trust of customers and society and grow together.
- Create new value and contribute to social development.
- Always take on the challenges presented to us,
pursuing all possibilities.

Websitehttp://www.sg-hldgs.co.jp/csr/

Report Period
March 21, 2016 - March 20, 2017
*When reporting periods differ, clarification will be provided asneeded.

CONTENTS

Organizations Subject to Reporting

Company Outline 02

60 Years of SG Holdings Group 

03

Message from Chairperson and President 

05

Long-term Management Vision 

07

Features08

Logistics Efficiency Solutions Forged By Pairing 11

SG Holdings Group Business Outline 

13Overseas Corporations 

15

CSR Activities Report 

17

Providing High Quality Services with a Foundation in Safety 

18Promoting Business Activities
with the Goal of Environment-Friendliness 

24

Contributing to the Development of Communities 

31

Building an Organization with Individuality and Diversity 37Constructing Supply Chain CSR 

43

Building a Responsible Management Foundation 

44

Expert Opinion 50

Two versions of the SG Holdings Group CSR
Report have been published: a digest (PDF
version) and a detailed report (an online version
written in Japanese only).
The printed version is intended for the generalpublic and our many stakeholders, while the online
version is for professional researchers of theenvironment and CSR. The printed version
describes initiatives we particularly want tointroduce to readers. The online version contains
information all of the information related to ourgroup CSR activities, including numerical data.
Our CSR Report 2017 website is written inaccordance with the GRI’s 2013 Sustainability
Reporting Guidelines (G4 Core).

Important contents for stakeholders

From Japan to Vietnam and the Rest of the World 

SG Holdings Group Companies and Foundations*Group-wide business initiatives are referred to as SG
Holdings Group initiatives or our Group’s initiatives.
*Activities related exclusively to specific companies andorganizations are clarified as needed.

Printed version
The version for thegeneral public and ourmany stakeholders.

Web

The version for professional researchersof the environment and CSR

Important contents for SG Holdings

1

SG HOLDINGS GROUP CSR Report 2017

Company Outline
SG Holdings Co., Ltd. is the pure holding company of the SG Holdings Group, which implements management strategies and administration
functions for the entire group. Each group company focuses on a specific area of expertise.
Name:

SG HOLDINGS CO., LTD.

Head Office Location:

68, Tsunoda-cho, Kamitoba, Minami-ku, Kyoto, Japan

Established:

March, 2006

Capital:11,882 million yen

Employees:

85,808 (consolidated / for March 2017 period)

Consolidated Performance
Operating revenue by segment

Logistics

Delivery

8,574

8,350

8,713

Operating income(Operating income:100 millions of yen)
9,303
500
494

9,433

455

433

600

652
498

28

Other Ventures

540(Operating revenue :100 millions of yen)
10,0008,000

Real estate

123

583

593

548

809

45

475

641
175

1,140

400

1,104
300

6,000
310

200

4,000
7,534

2,000

7,094

7,125

7,215

7,381

100

0

0

2012

2013

2014

2015

2016

(FY)

Note: Since fiscal 2013 we have changed our calculations per segment to cover four businesses, including real estate, and adjusted the figures for fiscal 2012 accordingly.

Delivery Businesses
Operating revenue(Operating revenue:
100 millions of yen)

Logistics Businesses
Operating revenue

Operating income

Operating revenue

Operating income

Operating revenue

Operating income(Operating income :100 millions of yen)

(Operating revenue :100 millions of yen)

(Operating income:
100 millions of yen)

(Operating revenue:
100 millions of yen)

(Operating income:
100 millions of yen)

(Operating revenue:
100 millions of yen)

(Operating income :100 millions of yen)

7,215

6,000

500

1,250

400

1,000

10

7,381

300

10

500

8

400

475

7

750

100

102

1,104

1,140

396

384

Other Businesses

Operating income

10,0008,000

Real Estate Businesses

6

80

300

200

500

4

60

57

750

49

600

600

50
641

40

60
51

4,000

900

200

40

450

30

300

20

150

10

175
2,000

100

250

0

0

0

2015

2016

(FY)

2015

2016

(FY)

2

100

0

0

20

0

2015

2016

(FY)

0

0

2015

2016

(FY)

SG HOLDINGS GROUP CSR Report 20172

60 Years of SG Holdings Group

1957 2016

Always Anticipating the Challenges Ahead
Our 60-year history rooted in a spirit of express messengers in the Edo period has always taken a path to anticipate the future andovercome challenges.
We will continue to anticipate the ever-changing logistics and customer needs while adapting through self-examination andreflection of the governance before us.
Even as the range of our business has become global, our approach to persevere will remain steadfast and never waver.

1957 1976

1977 1986

1987 1996

Courier Business and Period of
Rapid Growth After the War

National Growth, Organization,
and Contributions to Society

Rebirth of Sagawa Express After
Adversity

In 1957, Founder Kiyoshi Sagawa started
a courier business between Kyoto andOsaka all on his own. At the time, small andmedium-sized companies from private
stores to workshops flourished at the heightof economic growth following the period ofrecovery after the war. Small cargo transportby rail was common in the midst of thiseconomic boom. Couriers had to travel torailway stations for both shipping and pickup. Shipping luxury goods such as precious
metals as well as kimonos, precision
machines, foodstuff and other commodities
requiring special care as needed was alsodifficult. Kiyoshi Sagawa set his sights onthese needs and built a unique businessmodel to collect these types of shipments
as a courier business which would graduallywork toward business to business (B to B)
door-to-door transport. In 1965, Sagawa
Express was established in Kyoto to leverage
the acquisition of a General Section Cargo
Automobile Transport Business License.
Thereafter, the company found a footholdwith corporations across Japan, whichstarted with Osaka (1966) and Kagawa(1967). This accelerated the formation of the
Sagawa Express Group.

The Sagawa Express Group completed its
national shipping network in 1977, 20 years
after the courier business was establishedbetween Kyoto and Osaka. The groupnext established business firms in chargeof supporting the transport business,
including Sagawa Automobile Company(vehicle maintenance; current Sagawa
Galaxy Motors), Sagawa Logistics Services(warehousing; current Sagawa Global
Logistics) and Sagawa Computer Systems(configuration of logistics systems; current
SG Systems). In 1985, the group adopted
portable data terminals (PDTs) to operate
national freight tracking systems. This
innovation helped in improving customer
satisfaction by allowing customers to know
the status of their shipments. On anotherfront, we also began initiatives towardsocial contributions by establishing threefoundations in 1986, including the Sagawa
Scholarship Foundation (current SGH
Foundation).

The group, which had gradually expanded
its business, restructured itself as regionaltransport companies using methods suchas franchising and capital participation
to become an organization built upon a
network. At the time, 62 companies bore
the name “Sagawa Express,” including the
12 companies at the core. Each one of thesecompanies was an independent corporation
and, while competition was one factor for
growth of the group, it also came withmany governance issues. In 1991, the group
faced disbandment when uncollectible
accounts of more than 500 billion yen werediscovered at Tokyo Sagawa Express, which
had boasted the highest sales throughout
the Group. The main bank decided tosupport the revival of the group on its
own through mergers and consolidation
and began the reorganization with Eiichi
Kuriwada, who was the president of Osaka
Sagawa Express, at the helm. Sagawa
Express was reborn to start its path towardreformation after three mergers in 1992, in1994 and in 1997.

Unique business model for door-todoor transport

Ceremony celebrating the 20th PDT adopted in 1985
anniversaryFirst merger of Sagawa Express Recovery support after theGreat Hanshin Earthquake

Main CSR Initiatives

Main CSR Initiatives

Main CSR Initiatives

1975 Supported the donation of 10,000 yellow

1982 Contributed to large-volume transport of1991 Assisted in opening mission-critical forest“Courier” logo registeredas a design in 1976

triangular flags for pedestrian crossingsrelief and emergency supplies after heavy
rains in Nagasaki
1985 Started used truck donations to China

roads in Kochi prefecture1991 Adopted low-emission “methanol vehicles”
at Tokyo and Osaka branches
1993 Conducted disaster relief activities after the
Hokkaido-Nansei-Oki Earthquake
1995 Conducted disaster relief activities after theGreat Hanshin Earthquake3

SG HOLDINGS GROUP CSR Report 2017

1997 2006

2007 2016

Internationalization and Start of SG Holdings

Becoming Asia’s Leading Comprehensive Logistics
Group

In 1998, Sagawa Express began its first three-year reformation action
plan. Thereafter, the company examined and move to execution ofpolicies inherited by group management such as the acquisition of
ISO9001 international standards for quality management, restructuringof information systems, expansion of overseas locations and responseto the environment. In the same year, we started a door-to-doordelivery service that adopted home delivery rates to respond to therapid expansion of the home delivery market. We gradually started
new services from “Hikyaku Cool (chilled) Express” service in thefollowing year as well as the “e-collect" service for cash on delivery
using a credit card in 2000 to the “Hikyaku Global Express” and “Hikyaku
Mail Express” services. Moreover, in 1997, we began establishingoverseas sites for the first time in Hong Kong. In 2006, SG Holdings wasestablished as a holding company in order to shift to a structure withthe purpose to grow secondary and tertiary businesses while keeping
Sagawa Express at the core.
Furthermore, in 1998, Sagawa Art Museum was opened as acelebration of our 40th anniversary to contribute to society both
inside and outside of the company through arts and culture.

We started the three-year three-quarter medium to long-term
management plan in 2007. As operations expand in our total logistics
corporate group, we have successively established business ventureswith a wide range of functions such as personnel dispatchingcompanies. SG HOLDINGS GLOBAL PTE, LTD. was established in 2012
to supervise overseas companies in Singapore tasked with promoting
our overseas ventures. We welcomed AMEROID in Singapore in2013 and EXPOLANKA in Sri Lanka in 2014 as group companies andaccelerated the construction of a logistics network in Asia. “GOAL®”
advanced logistics project also began operation in 2014 to offer
proposals leading to solutions in the logistics challenges our customers
face while flexibly organizing teams with each group company,
which possess broad-ranging functions, with Sagawa Express at thecore. In 2016, Sagawa Holdings and Sagawa Express entered into a
strategic capital and business alliance with Hitachi Transport System,
Ltd. We also started the “First Stage 2018 (2016-2018)” new midterm management plan in the same year and are championing the“Becoming Asia’s Leading Comprehensive Logistics Group” long-term
management vision established simultaneously.

Sagawa Art Museum
opened in 1998 (Front)

EXPOLANKA
FREIGHTR

SG Holdings foundedin 2006

Main CSR Initiatives“GOAL®” operated
in 2014Main CSR Initiatives

1997 Adopted compressed natural gas (CNG) vehicles

2011 Acquired offset credits (J-VER) at Sagawa Forestry

2000 Started publishing the Sky Blue Environmental Report (current CSR Report)

2011 Conducted disaster relief activities after the Great East Japan Earthquake2001 Acquired the ISO14001 international certification based on international

2013 Sagawa Express specified a Designated Public Corporation as stipulated instandards for environmental management at Sagawa Express and Sagawa
Global Logistics

the Basic Act on Disaster Control Measures2014 Acquired the first “Carbon Neutral Certification” in the logistics industry

2002 Started initiatives toward WWF “Climate Savers Program”

2016 Conducted disaster relief activities after the Kumamoto earthquake2003 Adopted Super Rail Cargo2016 Acquired the first “Resilience Certification” in the logistics industry

2006 Entered into an agreement with the Japanese Red Cross to transport relief
supplies

SG HOLDINGS GROUP CSR Report 20174

Becoming Asia’s Leading Comprehensive Logistics GroupWe will pursue “sustainability and growth” globally withefforts to address social challenges and environmental
improvements through all of our group businesses.

Turning Point 60 Years After Our Founding

group has grown its transportation network from Kyoto andOsaka across Chugoku, Shikoku, Kyushu and all other regionsof Japan to Asia and the rest of the world. We have also

5

The SG Holdings Group will celebrate its 60th anniversaryenhanced our primary shipping-related business ventures,

since its founding in Kyoto in 1957 thanks to all of oursuch as warehousing, vehicle maintenance, IT systems,

stakeholders. At the time of our founding when the Japanese

payment services, real estate and personnel dispatching.

economy boomed with the end of recovery after the war in

In the last fiscal year, we set a long-term vision to becomesight, many small and medium sized companies from private

Asia’s leading comprehensive logistics group as a way of

stores to workshops burst with energy. The demand for small

moving into a new stage in our group’s history. We began the

cargo transport, such as product stocking and deliveries,“First Stage 2018 (2016-2018)” medium-term management

also had grown. As the roots of our group, Sagawa Express

plan to achieve this goal.

modernized the traditional courier business that quickly,

Developing a global logistics network through thesecurely and carefully delivered shipments from sender tostrengthening and integration of domestic and overseas

recipient to evolve into a business model that transported

businesses was raised as one basic strategy of “First Stage

goods door-to-door between corporations. Over 60 years, the2018.”SG HOLDINGS GROUP CSR Report 2017

Chairperson and CEO Eiichi Kuriwada (Left) andMessage from Chairperson and President

President and COO Tadashi Machida (Right)
SG HOLDINGS CO., LTD.

We welcomed Ameroid in Singapore in 2013 andof e-learning and group training with the aim to provide

Expolanka in Sri Lanka in 2014. We focused on building

excellent learning opportunities where highly motivateda logistics network in Asia in the last fiscal year, including

employees can take the initiative to learn and open new

operational alliances with RPX in Indonesia and LBC in theavenues in their careers. We also opened “SGH Kids Garden,”Philippines as well as making Phat Loc* in Vietnam a groupwhich is the first internal nursery school of the SG Holdings

company. Especially in Vietnam where growing delivery

Group, so that employees and their spouses can have piece-

needs have to be satisfied, we are heightening our presence asof-mind in work after the birth of a child. Moreover, wea comprehensive logistics group by acquiring local companies

are promoting diversity and inclusion initiatives. We are

who have a delivery network throughout all of the provinces.

also further enhancing welfare programs with the start of*The current name of the company is “SG Sagawa Express Vietnam”

operations in the Group’s “SGH Family Benefit Association.”

We are also operating the “Smart Import®” international
integrated shipping service from each region in Asia to Japanthrough a partnership with Hitachi Transport System. We
have been able to enhance our intentional logistics network

To our stakeholders

through this alliance. In the future, we will actively use ourestablished network to propose logistics solutions able to

We believe clearly continuing the logistics that has become

respond to the diversifying needs of our customers in eacha social infrastructure today and contributing even more

corner of the world.

greatly to society through our business is vital to remaininga group needed by all of our stakeholders. We also recognize
our responsibility to sincerely respond to challenges faced by

CSR management in-line with the environmentand society requires of a company

each country and region as a corporate group expanding its
businesses globally.
We will actively communicate with all of our stakeholders
now and into the future and conduct our businesses andAligning ourselves with the environment and society is

initiatives in a way that is able to respond to environmental

more important than ever before as we grow our businesseschanges, clearly grasp challenges and expectations and meetglobally. We are furthering a corporate framework and legal

the requirements of society.

compliance necessary to address the environment and human

We ask for your ongoing support in the future.

rights as well as prevent corruption around the requirementsof the United Nations, Europe and America. We also need tomove from the conventional concepts of a business primarily
conducted in Japan to that tailored to global standards. The
value of a company in-line with the environment and societythat engages in medium-term sustainable management is
growing internationally. We are working to earn the trustof various stakeholders by advancing CSR management
throughout our entire group in Japan and overseas.

Eiichi Kuriwada
Chairperson and CEO
SG HOLDINGS CO., LTD.

We opened “SGH University” corporate university in
March this year as part of this CSR management. Facilities
to conduct group training were newly established in Tokyoand the university began operation around the two pillars

Tadashi Machida
President and COO
SG HOLDINGS CO., LTD.

SG HOLDINGS GROUP CSR Report 2017

6

Long-term Management Vision

Becoming Asia’s Leading Comprehensive Logistics Group
Basic strategies of Mid-term Management Plan First Stage 2018
1. Ensure sustainable development through productivity improvement and evolution of comprehensive logistics solutions
2. Develop global logistics network through the strengthening and integration of domestic and overseas businesses
3. Increase in value and optimization of peripheral logistics businesses
4. Establish HR management system and utilize diversified human resources
5. Utilize the latest technology to deliver superior solutions to our customers and streamline business activities

Become Asia's Leading
Comprehensive Logistics Group.

SG Holdings Group

Mid-Term Management Plan

Management Strategy
1.Ensure sustainable development through productivity improvement and evolution ofcomprehensive logistics solutions
2.Develop global logistics network through the strengthening and integration of domestic
and overseas businesses
3.Increase in value and optimization of peripheral logistics businesses
4.Establish HR management system and utilize diversiﬁed human resources
5.Utilize the latest technology to deliver superior solution to our customers and streamline
business activities

Priority measures

1. GOAL®
SG Holdings Group aims to develop integrated logistics solutions that support our customers’ value chainsby utilizing our proposal capabilities and synergy in fields
such as deliveries, logistics, IT, settlement services, andglobal business. In addition to further strengthening upstream sales in the supply chain, we aim to develop further synergy through active investments in new markets,
such as medicine, healthcare and cold chains.

2. Overseas businessIn addition to developing our business platform in Asia,
we aim to establish a global logistics network by using
the strengths of EXPOLANKA HOLDINGS PLC to enhance
our forwarding network. We will continue to strengthen
our deliveries and logistics businesses in Asian countries
in a way that utilizes the know-how of our group.

CMYK2016 年 4 月 05 火曜日 21:38:11

3. Logistics-related businessWe will strengthen all logistics-related fields, in partnership with our deliveries
and logistics business. In our real estate business, we will carry out competitive
real estate investments in conjunction with our logistics business. In our settlement service business, we aim to construct new settlement services based on
our logistics-related settlement service, e-collect®.

4. Human resource management
We aim to secure talented human resources and labor by developing systems
to hire, train and manage our human resources. We have set the following priority themes: “Utilization of diverse human resources;” “Reforming employees’
work style;” and “Life support.” We aim to build an organization that continues to
produce competitive and talented human resources through the construction
and operation of a new human resource management cycle.

5. Utilization of new technologies
We aim to provide our customers with new services and to achieve quality and productivity improvements by using the new technologies that arise
through technological progress, including automation technology and robots
that promote labor-saving and efficiency improvements achieved through theautomation of warehouse operations.

7

SG HOLDINGS GROUP CSR Report 2017

SGH Feature (1)The People's Republic of China

Japan

Pakistan

TaiwanMyanmar

India
Bangladesh

Laos

VietnamThailandPhilippines
Cambodia

Malaysia
Singapore
Indonesia

Initial Sites for Global Logistics

From Japan to Vietnam and the Rest of the World
SG Holdings Group set the development of a global logistics network through the strengthening and integration of domestic
and overseas businesses as a basic strategy in the mid-term management plan.
The ASEAN countries where growth continues is an area predicted to still have great potential as a region for manufacturing
and consumption.
We began establishing ourselves in this region with entry into Vietnam and the Philippines in 1997 and opened business sitesin Singapore (1998), Thailand and Indonesia (2005), Malaysia (2006) as well as Cambodia (2013) thereafter.
Especially in Vietnam, we are accelerating a variety of businesses around three companies; Sagawa Express Vietnam, SG
Sagawa Vietnam and the new SG Sagawa Express Vietnam.

Appeal of International Logistics Sites in Vietnam
Vietnam offers vastly broad national lands and natural quality
harbors in the South China Sea. The country also has hardworking citizens and cheap labor. Vietnam today has become the“global textile factory” after China. This is why SG Holdings has
positioned Vietnam as a major strategic location in the world.
However, as one of the few socialist countries remaining
today, Vietnam reached a major turning point toward an open
economy after 2010. We had many limitations in Vietnam after
launching Sagawa Express Vietnam (1997-) under the condition
the incorporation be a joint venture with local capital. Vietnam
had overwhelming difficulties but was quite appealing as a

Sagawa Express Vietnam Co., Ltd.

logistics site even with those drawbacks.
Then, in 2015, SG Sagawa Vietnam was established as a whollyowned subsidiary in the same region as deregulation progressed.
This allowed us to reflect quick decision-making into
corporate management. Both of these companies are also
unique foreign affiliates that have acquired all comprehensive
logistics licenses and certifications in import/export customs
clearance, international transport by air and sea, trucking, general
warehousing, container freight station (CFS) warehousing andbonded warehousing.

SG Sagawa Vietnam Co., Ltd.

Established: June 12, 1997

Established: March 6, 2015

Employees: 554 (as of April 2017)

Employees: 334 (as of April 2017)• Import/export customs clearance• Warehousing services (bonded, CFS, general warehousing)• Freight forwarding operations (air/sea)• Truck transport• Delivery operations (domestic delivery, cool express, etc.)• Moving operations• 3PL operations (apparel)• Freight forwarding operations (air/sea)• International express services• Delivery operations (domestic delivery, cool express, etc.)• Moving operations• Warehousing services (insured, CFS, general warehousing)• 3PL operations (apparel, general goods, furniture, etc.)• Trading operations

SG HOLDINGS GROUP CSR Report 2017

8

SGH Feature (1)3PL to the Last One Mile...
Today, both of these companies have expanded to 15 businesslocations and 6 warehouses throughout Vietnam.
We are constructing an international logistics network thatclosely connects Japan and Vietnam.
As an example of third-party logistics (3PL; lump-sum contract
for corporate logistics) including apparel, “We place shipments
in our warehouses and conduct logistics processes such as
inspections, metering, pricing, and sorting from tags (packaging
by bundling multiple products pulled from inventory as
designated for the delivery destination) from factories in Vietnam.
These items are then sent through intermodal transportation
by sea or air to clear customs for each target region - whichallowed customers that were conducting their own storage andlogistics processes for cargo in Japan up until now to expect
greater speed, reduced costs and all the other benefits after
shipments arrived in Japan.” (President Junji Shimasaki, Sagawa
Express Vietnam/SG Sagawa Vietnam)
On another front, a delivery business in Vietnam was also
launched to advance the construction of a system able toachieve “last one mile deliveries” to the customers’ door. We hadalready begun delivery services in major metropolitan areas suchas Hanoi and Ho Chi Minh in 2015. Phat Loc Express & Trading
Joint Stock Company (current: SG Sagawa Express Vietnam),which possessed its own delivery network throughout all ofVietnam, joined our group in 2016.
In addition, we also expanded our other ventures in Vietnam
through forging an alliance with the “Vin Group” that operates
shopping malls in the country (2016) and to start offeringsolutions in logistics services for large stores (internal distribution,
cargo mediation, etc.)

As new logistics sites in Vietnam, SG Sagawa Vietnam Distribution Center (Nhon Trach 3 Industrial Park, Đồng Nai) multi-tenant logistics facility opened in November 2016.
Refrigerated and frozen storage, bonded warehouses (pending) as well as equipment for logistics processes are packed into the gigantic 44,000m² premises so that we can even handle fresh fish and medical
supplies.

Building an Environment Actively Appointing
and Encouraging Participation of Women
We actively strive in CSR at each of our locations in Vietnam.
Vietnam is a country with a tradition of furthering theempowerment of women. One reason is that many families
live together with three generations of relatives, including their
grandparents, which alleviates the stress of raising children.
Today, the employment rate of women at both Sagawa Express
Vietnam and SG Sagawa Vietnam is 33% with 294 women working
enthusiastically.
“We started commemorating employees for 15-year tenure in2015. We had estimated roughly 20 to 30 people for the first fiscal
year, but there were in fact more than 120 people in Ho Chi Minh9

SG HOLDINGS GROUP CSR Report 2017

alone. It was such a wonderful surprise! The very large number ofwomen employees and managers among those being celebrated
was also astounding.” (President Junji Shimasaki, Sagawa Express
Vietnam/SG Sagawa Vietnam)
While there is a high awareness of labor rights unique to socialistic
countries, policies such as welfare benefits are still far behind.
Therefore, we adopted a “Japanese style” in some areas. For example,
we introduced mandatory entry into workers’ compensation andhealth examinations for all employees as well as benefits such asrecreational company trips and special allowances for lunch. These
programs earned high praise.

In the meantime, we verify the age of employees with publicrecords able to identify the individual such as IDs in our hiring
practices. We also strictly management attendance with a fingerprint
identification system to prevent any maliciousness. Our drivers
must clear high international standards that we have set such ascomprehensive traffic safety education. The background for these
programs; “These are common practices and indispensable when
doing business with European and American companies. The
clients will conduct CSR surveys and even visit the site to see our
CSR first hand.” (President Junji Shimasaki, Sagawa Express Vietnam/
SG Sagawa Vietnam) Of course, efforts to reduce the environmental
burden from energy savings to minimization of waste at our offices
and warehouses are also necessary.
In addition, there is one more topic about CSR that needs to bementioned. We are also holding traffic safety classes at kindergartens
as constant traffic jams and traffic accidents become even greatersocial issues. Our employees act as instructors and teach traffic
rules to the kindergarten students. This attempt at a new type of
educational program is gaining a lot of attention locally for efforts
that include the distribution of original notebooks to the children
who participate.
Head office of Sagawa Express Vietnam/SG Sagawa Vietnam

Employees working in the Vietnam SGH Group

Traffic safety class for kindergarten students

From Japan to Asia and the Rest of the World
Production of industrial products such as apparel is shiftingfrom the surging labor costs of China to Vietnam and Indonesia
while businesses are starting to transfer to South Asia, the Middle
East and Africa, which has been deemed “the final frontier.”
Major European and American apparel companies are alreadyanticipating tomorrow. Building a logistics network seamlessly
connecting Japan with these companies, production sites, andconsumption is imperative.
In addition, by leveraging the delivery (door-to-door) which isa specialty of our group, international intermodal transportation
for Japan that connects local factories with stores in Japan is afield predicted to have even greater needs in the future.

In 2014, our logistics network became like none other as partof our global strategy with the addition of Sri Lanka Expolanka’slogistics network across South Asia, the Middle East, Africa,
Europe and America. This is thanks to the synergy brought about
by the complimentary business fields of Expolanka to expand the“far east to west” vector of our group “even further west.”
The geographical advantage of Vietnam is truly a bridgehead
toward globalization.

SG HOLDINGS GROUP CSR Report 201710

SGH Feature (2)Efficiency Able to Respond to Environmental Changes
in the Logistics Industry

Logistics Efficiency Solutions
Forged By Pairing

Mark for a Certified Comprehensive Streamlining Plan
(Ministry of Land, Infrastructure and Transport 2016)

Amendments to the Act on Advancement of Integration and Streamlining of Distribution Business were enacted in 2016 withthe purpose of streamlining and reducing the environmental burden in the logistics industry.
In the backdrop of these amendments, the environment surrounding logistics was changing dramatically such as a labor
shortage and aging drivers in the industry in addition to an increase in online shopping. Initiatives toward “logistics efficiency”
required for the drastic changes in the environment are underway.

Smart Delivery® × Railway transport~ Building the “Optimal Delivery Scheme” for Customers ~Sagawa Express provides railway transport that uses the “Smart
Delivery®” logistics efficiency service and “Super Rail Cargo.” We areachieving greater customer satisfaction and further streamlining
as well as reductions on the environmental burden through newlogistics schemes that combine these two services.
We are handling a wide range of products from regions in Kansai
for customers who are online shopping business proprietors with
offices in metropolitan areas while their manufacturing partners
are located across Japan. Conventionally, Sagawa Express collected
shipments at 44 branches throughout Kansai to ship to a relay
centers in metropolitan areas by transport trucks from each branch.
Customers can introduce “Smart Delivery®” so that their cargocollected at our 44 branches in Kansai will be gathered at theKansai relay center. The cargo is loaded into containers after it issorted in advance for a modal shift to railway transport that uses
“Super Rail Cargo” between Osaka and Tokyo. This makes direct

delivery to customers possible after shipments arrives at a cargoterminal in Tokyo, which reduced time and allowed even fewerstages in transport.
One major advantage of this scheme is the dramatic reduction
and stability for the time of delivery for cargo from Kansai districts,
which had not had stable delivery periods, by using railway
transport. This allows customers to put together planned schedules
for operations in warehouses themselves. As a result, we are able
to improve customer satisfaction by facilitating our customers tomore quickly include their products on their online shopping sites
and heightening the sales promotion effect.
Moreover, by achieving a reduction in CO emissions and total
truck transport time, we were certified as business operators by the
Ministry of Land, Infrastructure and Transport as a comprehensive
streamlining plan for the revised Act on Advancement ofIntegration and Streamlining of Distribution Business.

Smart Delivery® × New Railway Transport Scheme

Main partners
in Kansai region

Total truck
transport time

Kansai
Sales Office88

Kansairelay center

Approx.
%(1,838 hours) reduction

Modal shiftCO emissions

Tokyo
cargo terminal

Direct delivery

Customer66

Approx.
%(3,113 tons) reduction

Smart Delivery® : Service to promote process operation improvements from customer procurement (stocking) to delivery (warehousing/inspection) in the BtoB supply chain in which Sagawa Express is an expert.
Customers realize a reduction in the burden of operations in warehouse by deliveries sorted in advance by product category and location at large-scale facilities at Sagawa relay centers and branches that arrive at adesignated interval of time, even after midnight or early in the morning.
Super Rail Cargo : Super Rail Cargo train-type freight electric multiple container developed in cooperation with Japan Freight Railway Company has been in use since 2004 for transport shipments between Tokyo
and Osaka. One 16-car train (28 containers) runs on each railway to and from Tokyo and Osaka late at night. The capacity is equivalent to 56 ten-ton trucks and contributes to reducing CO emissions by carrying
10% of all shipments between Tokyo and Osaka.

11

SG HOLDINGS GROUP CSR Report 2017

Sagawa Express × Hitachi Transport System~ Realizing Distribution Efficiency with Effective Use of Logistics Facilities ~SG Holdings, Sagawa Express and Hitachi Transport Systementered into a strategic capital and business alliance in March
2016 to expand various cooperative businesses that leverage
the strengths of each company. In Japan, the alliance has begun
initiations to heighten efficiency by jointly using vehicles andlogistics facilities.
One of these facilities is the “Hitachi Transport System Shonan
Distribution Center” located in the Kashiwa City and Shonan areaof Chiba Prefecture. A satellite location for the Kashiwa Sales Office
was newly established to cover the Kashiwa City and Shonan
area in the standby shipping space of the above facility. Efforts toeffectively use this facility as a site to conduct relay center sortingand shipping operations are underway.
This effort creates new routes from the Shonan area to the relay
center without routing through the Kashiwa Sales Office, which
was often congested. These new routes help avoid traffic as well
as reduce the transport distance and the number of vehicles. In
fact, the number of hours drivers spend on the road has decreased
10,045 hours (32%) and has limited CO emissions by 27.3 tons (57%).

This initiative not only effectively utilizes the standby shipping
space of the “Hitachi Transport System Shonan Distribution Center,”but the advantages in heightened efficiency such as streamlining
through mitigation of a concentration of shipments at the Sagawa
Express Kashiwa Sales Office should also be mentioned.
This scheme has received certification as a comprehensive
distribution efficiency plan from the Ministry of Land, Infrastructure
and Transport for the revised Act on Advancement of Integrationand Streamlining of Distribution Business.
The ideas for greater logistics efficiency able to be created withpairing of a multitude of services and partners is infinite. At the SG
Holdings Group, we are striving toward solutions to a wide range ofchallenges faced by the industry and society today while evolving
logistics around the keyword of “efficiency.”

Joint Project Scheme

Kashiwa
Sales Office

Relay center

Sender in Kashiwa/
Shonan area

Shonan distribution center

Sagawa Express cargohandling area

Sender from
Hitachi Transport System(Apparel goods,
sports products, etc.)

Relay center

Hitachi Transport
System cargohandling area
Relay center
Movable rollers new installedin the distribution center to utilize
as a cargo handling area for Sagawa Express

Reduces
driving hours

32%(10,045 hours)

All sales offices

Each delivery
destination

New transport routes built by this scheme
Old transport routes eliminated by new transport routes

ReducesCO emissions

57%(27.3 tons)
SG HOLDINGS GROUP CSR Report 201712

SG Holdings Group Business Outline
SG Holdings Group has developed business both in Japan and overseas in a variety of fields, such as deliveries, logistics, real estate,finance and systems development, in a way that utilizes our group synergy to the fullest.
We will continue to make use of these efforts to increase the capabilities of the group in specific areas and achieve the provision of
total solutions as a whole group. In this way, we aim to respond rapidly to the diverse needs of our customers, gain further trust fromsociety, and become a corporate group that is needed by society.

Delivery Businesses

Sagawa Express Co., Ltd.

SG Moving Co., Ltd.

World Supply Co., Ltd.

Providing total logistics solutions in addition
to a wide range of delivery activities with aparticular focus on express delivery.

Offers various installation and moving related
services, including large furniture and home
appliances.

Offers delivery agency services to department
stores, etc., 3PL, and cooperative food delivery
services.

Humony Co., Ltd.
Expands telegram-related services.

Logistics Businesses

Sagawa Global Logistics Co., Ltd.
Sagawa Logistics Partners Co., Ltd.
Optimizes all aspects of the supply chain
through 3PL operations, logistics processing,
etc.

13

SG HOLDINGS GROUP CSR Report 2017

Real Estate Businesses

SGH Global Japan Co., Ltd.

SG Realty Co., Ltd.

Offers comprehensive internationaltransport services, from international
logistics and shipping storage to domestictransport.

SG Assetmax Co., Ltd.
Carries out development, application, andmanagement of logistics facilities.

Delivery Businesses

Logistics Businesses

Real Estate Businesses

Other Businesses

We provide one-stop solutions not
limited to simple transportation
services and we resolve customer
issues from a logistics perspective
through coordination with ourGroup companies.

We utilize the network we haveestablished and spread acrossthe entire country to provide
complete logistics solutions thatcan resolve customer logistics
issues.

While managing and operating
our Group’s real estate facilities,
we are also involved in thedevelopment, application, andmanagement of real estate andfacility infrastructures centered on
logistics.

Our Group companies are
involved in a variety of businesses,
even in fields serving as businessfoundations such as vehicle
maintenance, IT systems, finance,
and temporary personnel agency.

Other Businesses

Sagawa Advance Co., Ltd.

SG Motors Co., Ltd.

SG Systems Co., Ltd.

Offers general services such as insurance
business, travel business, and productdevelopment business.

Offers various services including vehicle
maintenance, body production, as well as
new and used car sales.

Deploys businesses such as development
and operation of package tracking andshipment support systems that are among
the largest in the country.

Sagawa Financial Co., Ltd.

SG Fielder Co., Ltd.

SG Expert Co., Ltd.

Offers financial services including e-collect®
COD service.

Offers outsourcing services of personnel
such as warehouse related business.

Brings together the Group’s administrative
tasks, such as general affairs, humanresources, and accounting.

Nouvelle Golf Club Co., Ltd.

Sagawa Forestry Co., Ltd.

Manages a golf course in Oamishirasato,
Chiba prefecture, which respects and is inharmony with nature.

Cultivates, preserves, and manages
forests owned by the Group in Kochi and
Tokushima prefectures.

SG HOLDINGS GROUP CSR Report 201714

Overseas Corporations
In addition to its companies in Japan, the SG Holdings Group, centered in Singapore and Sri Lanka, owns roughly 100 affiliated companies (ofwhich 62 companies are related to overseas logistics businesses) in 24 countries and regions around Asia, the Pacific Ocean and Indian Ocean,and is developing international businesses.

South Korea
People's Republic of China

Pakistan

United Arab Emirates

TaiwanIndia
Bangladesh

ThailandCambodia
Vietnam

Sri Lanka
Maldives

Malaysia

Singapore

Kenya

1

SG Holdings Global Pte. Ltd.

Supervision of sites in Singapore and all our Group’s international
businesses (planning for international business, strategy formulation,fund raising, funding international subsidiaries, and other management
operations).

 East Asia
2

Shanghai Poly-Sagawa Logistics Co., Ltd.

Freight Forwarding* / Logistics (storage, logistics processing, 3PL) /International express delivery**1 Services relating to the carriage, consolidation, storage, handling, packing or
distribution of the Goods, including customs and fiscal matters, declaring the Goods,
procuring insurance of the Goods and collecting or procuring payment or documents
relating to the Goods.
*2 A service to transport small packages with fast turnaround using international air
freight.

3

Poly-Sagawa Logistics Co., Ltd.

Indonesia

 Southeast Asia
7

Sagawa Express (H.K.) Co., Ltd.

Freight Forwarding / Logistics (storage, logistics processing, 3PL, CFS) /Delivery / International express delivery
5

Sagawa Express International Taiwan Corp.

Freight Forwarding / Logistics (storage, logistics processing, 3PL) /International express delivery
6

Sagawa Logistics Korea Co., Ltd.

Freight Forwarding / Logistics (storage, logistics processing, 3PL) /International express delivery

15

SG HOLDINGS GROUP CSR Report 2017

Sagawa Express Philippines, Inc.

Freight forwarding / Delivery (such as domestic delivery and overseas
moving) / International express delivery
8

Sagawa Global Logistics (Philippines) Inc.
Logistics (bonded warehouse)

9
10

Sagawa Express (Thailand) Co., Ltd.
SG Sagawa (Thailand) Co., Ltd.

Freight forwarding / Logistics (storage, logistics processing, 3PL) /Delivery (domestic delivery, cross-border delivery) / International expressdelivery

Sagawa Express Vietnam Co., Ltd.
SG Sagawa Vietnam Co., Ltd.
13 SG Sagawa Express Vietnam., LLC
11
12

Freight forwarding / Logistics (storage, logistics processing, 3PL) /Delivery (door-to-door delivery, domestic delivery, cross-border delivery) /International express delivery

Freight Forwarding / Logistics (storage, logistics processing, 3PL, CFS) /Delivery / International express delivery
4

Philippines

14

Sagawa Global Logistics (Malaysia) Sdn. Bhd.
Freight Forwarding / Logistics

15

SG Sagawa Ameroid Pte. Ltd.
Total logistics services in Singapore

16

Amgas Asia Pte. Ltd.

Transport of petrochemical product in Singapore

United States of America

Mauritius
Madagascar
South Africa

Are countries and regions where sites exist

17

Pt. Sagawa Express Indonesia

Freight forwarding / International express delivery / Logistics / Delivery(Domestic delivery) North America
18 South/West Asia
 Africa
19

Expolanka Holdings Plc
Core enterprises: Expolanka Freight (Pvt) Ltd.
With its Head Office set up in Sri Lanka, it owns 20 offices within India.
It deploys businesses focusing on freight forwarding, with its strength
lying in its network in the regions of South Asia, the Middle East, Africa,
Europe, and North America.

SG Sagawa USA, Inc.

Freight Forwarding / Logistics (storage, logistics processing, 3PL) /International express delivery

Expolanka Freight (Sri Lanka)
Expo Freight (India)
22 Expolanka Bangladesh
23 Expolanka Freight Dubai
24 Union Cargo (Pakistan)
20
21

25

Classic Travel

Expolanka Freight (South Africa)
Expolanka Freight (Kenya)
28 Expolanka Freight (Mauritius)
29 Expolanka Madagascar
26
27

EXPOLANKA FREIGHT (SRI LANKA)SG HOLDINGS GROUP CSR Report 201716

CSR Activities Report
The SG Holdings Group recognizes that providing a safe and secure infrastructure to our stakeholders, as Sagawa Express designatedpublic institution under the Disaster Countermeasure Basic Act, is the foundation of its business activities. Also, in association with the further
globalization of our businesses, we intend to fulfill even greater responsibilities by addressing social issues on a global scale. We strive to be
conscious of the environment and to develop regional communities.
Based on these concepts, in fiscal 2013 we organized activities centered on the seven core subjects and issues of ISO26000, and closely
examined their related issues. In fiscal 2014, we identified the six material CSR issues and set activity topics and mid-term goals for eachmaterial issue. In fiscal 2015 to fiscal 2016, we and our Group companies set activity themes and mid-term goals for each material issue, andmoved forward with enhancing their management across the entire Group.
We will continue to promote practical CSR activities throughout the Group.

Providing High Quality Services
with a Foundation in Safety P18

Material CSR Issues

19 Contributing to a safe
and secure transportation society
21 Quality control basedon the customer’s viewpoint
22 Developing and providing products
and services from a customer viewpoint
22 Reflecting customer feedback
in corporate activities
23 Initiatives of overseas corporations

Building a Responsible
Management Foundation

P44

44 Building a foundation for CSR promotion
45 Compliance46 Risk management
47 Crisis management
48 Information security

Constructing Supply Chain
CSR P43

Promoting Business Activities
with the Goal ofEnvironment-Friendliness P24

25 Reduction of CO emissions throughout
the entire distribution system
29 Aiming for a recycling-oriented society
29 Environmental awareness for the next generation
30 Preservation and environmental awarenessof forests and biodiversity

Contributing to the Developmentof Communities P31

43 Cooperation with business partners

Building an Organization
with Individuality
and Diversity P37

32 Supporting the foundations of local communities
34 Community Interaction Through Sports Events
35 Supporting academics, culture, and next-generation
education (Foundation activities)
36 Local contribution activities of Expolanka (Sri Lanka)

38 Respect for human rights
39 Diversity & inclusion
41 Human resources
42 Work-life management

Processes for Identifying Material CSR Issues

17

Organize activities andConduct hearings withclosely examine issues

responsible personnel

centered on ISO26000

from each department

SG HOLDINGS GROUP CSR Report 2017

Prepare drafts formaterial CSR issues

Exchange opinions with

Material CSR issues

external experts on

are shared by CSR

validity of drafts

Committee

Confirm progress ofmaterial issues

Providing High Quality Services with a Foundation in Safety

Our Pride at the Truck
Driving Championships
Safe transport is our mission.
Sagawa Express first participated in the Truck Driving Championships in 1983, and it has earned an
outstanding track-record even at the national competition. In 1993, we also started the Sagawa Express
Truck Driving Championships for the purpose of further skill enhancement and legal compliancethroughout the Group. 84 elite drivers, including 20 women, from around Japan competed with theirknowledge and skill at the 24th Driver Competition held last year.

SG HOLDINGS GROUP CSR Report 201718

Contributing to a Safe and Secure Transportation Society
Safety Management Systems
Sagawa Express views transport safety as the most importantmanagement issue.
In terms of the system, we hold “Safety Meetings” each month for
management personnel. “Sagawa Official Communication Sessions”
are also used as a venue with the participation of employees fromall of Japan to unify management personnel with job sites such as
leveraging feedback from drivers in safety measures. In terms ofoperation, a PDCA cycle aimed toward ensuring transport safety

is being deployed based on the transport safety management
system.
In addition, we have worked to prevent accidents at intersections
as an important matter toward preventing traffic accidents.
In fiscal 2017, we will place high priority on initiatives to prevent
accidents at intersections and accidents involving the movementof unattended vehicles, which have a high risk of leading to serious
accidents.

Safety Management Organization Diagram

PDCA for Transport Safety

Board of Directors

Consider feedback
from on-site
employees
Instructions,guidance

Plan
CreateSafety Plans

Safety Meeting

Safety Measures
Committee

Act

Do

Improve/Review
Management

Execute/Practice Plans

Deliberations on
Headquarters Safety
all safety related topics Promotion Meeting

Officer Manager
Meeting

BranchOffice Managers
Sales Offices
Service managers

Safety Promotion
Meeting

Check

MaintenanceManagers

Perform Internal
AuditsDrivers

Promoting Safety Education
Sagawa Express carries out safe driver development training at
training facilities in Kanagawa, Aichi and Kagawa Prefectures.
We conduct ongoing education for one year, including followup support, from basic safe driving training for new employees
until they are independent Safety Drivers® (SDs).

Even for instructors, we also hold SD instructor certification
training and safe driving examiner certification. Moreover, we
engage in specialized training for management personnel andinstructors to set a firm foundation of eco-safety driving in all of ourdrivers.

¢ Sales Driver® Instructors

Safety-related Training

Driving Assessment

Driving Ability Assessment

Basic Safe Driving Training

Basic New Employee Training

Join Company

Training Prior to Joining Company

Driver Mentoring

Tests Conducted by Safe Driving Examiners

Regular Driver Observation

12 Month Driver Mentoring

6 Month Driver Mentoring(Continuous Driving Ability Assessment)

SG HOLDINGS GROUP CSR Report 2017

3 Month Driver Mentoring

19

Examiners(SD = Safety Driver®)1 Month Driver Mentoring¢ Safe Driving Examiners

Follow-up Support Period
for SD Instructors

SD Certification Training

Instructors

Training Period
for SD Instructors
Collection and Delivery Service Test

8,920
1,277

New Driver
Training Flow

Providing High Quality Services with a Foundation in Safety

Initiatives in Safe Driving and Accident Prevention
Truck Driving Championships

Securing Safety for Highway Transportation

We hold Truck Driving Championships every year at Sagawa
Express with the goal of cultivating professional drivers andincreasing the safety awareness of all our employees as part of our
responsibility as a business operator that uses public roads.
In fiscal 2016, a total of 84 drivers (including employees of Group
companies) were chosen from all over the country to use thedriving skills and knowledge they have gained to compete in the
categories of three knowledge, driving, and inspection. Training is
performed jointly at multiple Sales Offices for the championships,
which allows participants to share related knowledge, hone theirdriving skills and etiquette, and develop professional awareness.

Sagawa Express is advancing initiatives that aim to improve thesafety of highway transportation.
Highway Transport Safety Patrols carry out activities to prevent
traffic accidents and vehicle breakdowns by performing vehicle
checks as well as mentally and physically refreshing our drivers at
main service areas and parking areas.
We recommend and conduct vehicle inspections for our own aswell as our partners’ vehicles and even on general trucks. We also
do Highway Transport Terminal Inspections in which managers at
Sagawa Express and partner companies use special check sheets toinspect vehicles at all of our business sites.

Truck Driving Championships

Activity of the Highway Transport Safety Patrol

Traffic Accident Prevention Initiatives

Providing Safe Driving Training Services

The SG Holdings Group is striving to expand support systems
and improve quality by building a network of 14 branches, 26
company-owned maintenance plants and 275 affiliate mechanics
supervised and managed by SG Motors with the goal of eliminating
traffic accidents related to vehicle maintenance.
Sagawa Express has equipped 41.6% of all of its vehicles (10,195)
with drive recorders* to utilize in providing driving instruction todrivers as of March 2017. Sharing of the information recorded inthese devices by drivers will help prevent traffic accidents.

We are also providing know-how in safe driving cultivated by
Sagawa Express with general business operators as Safe Driving
Training Services. We held programs composed of desk work andpractical training such as safety lectures and driving aptitude tests
for instructors and drivers alike at our company-owned facility in
₂
Kanagawa Prefecture (approx. 31,680m ). We have received requests
for training from not only transport and delivery business operators
but also companies that include manufacturers, distributors andlong-term care facilities. As of fiscal 2016, 43 companies haveparticipated in 165 training courses with 1,675 participants.
We will contribute to traffic safety even more widely throughout
all of society by responding to the needs in a variety of industries
even more while strengthening our training for instructors in fiscal
2017.

*Drive recorder: Recording equipment specialized for installation in vehicles used to record thecauses of accidents. This information is used in instruction to correct unsafe driver behavior such as
braking, stopping, steering, turning, and smooth driving.

¢ Vehicles Equipped with Drive Recorders

10,195¢ Safe driving training for general business operators

As of March 2017165

As of Fiscal 2016

Vehicles*Increased 2,295 compared to the previous fiscal year

CoursesSG HOLDINGS GROUP CSR Report 201720

Quality Control Based on the Customer’s Viewpoint
Quality Improvement Initiatives
Sagawa Express has acquired the ISO9001:2008 international
quality management system certification for continued
improvements to transportation quality at 458 business sites. In thisfiscal year, we are further enhancing our system to be re-certified
under the ISO9001:2015 updated version by fiscal 2018. In fiscal
2016, we appointed a manager responsible for quality at all sales
offices and put in place a system that heightened transportation
quality. Transportation quality was broken down into numericbased on eight quality KPIs* uniquely set by the group to assist
in improvements by finding the reasons why standards are notachieved. For example, we have installed “impact meters” together
with shipments that measure impacts to scientifically examine
whether there is a potential for collisions and help in preventing
disruptive accidents. Furthermore, we are raising awareness about
improving transport quality through means such as posters toencourage caution as well as educational DVDs about cargo
accidents in addition to quality improvement poster contents for
employees.
SG Motors has established a new CSR & Quality Assurance
Project Office and aims to provide even higher quality services

by spearheading a cross-functional group through links between
organizations that had been divided by function such as sales
and manufacturing. As a result, we have reflected the needs ofcustomers in our business and achieved quality guaranteed sales
for used vehicle sales as well as body manufacturing orders.
SG Moving holds Quality Championships with the goal of
improving the moving and installation transport service quality. Asof the fifth competition in fiscal 2016, 9 teams with 18 competitors
chosen from all throughout Japan including partner companies
faced off to show their knowledge and skills in three challenges
that included a written test, packaging operations and protective
moving.
*Time band service fulfillment rate, fulfillment rate of redelivery due to absence, just-in-time delivery
fulfillment rate, morning delivery rate, number of Cool Express freight temperature accidents which
are our responsibility, number of outbound freight accidents which are our responsibility, numberof inbound freight accidents which are our responsibility and the complaint occurrence rate

National Hikyaku Cool Express to Delivery Cold and Frozen Goods Fresh
Hikyaku Cool Express offered by Sagawa Express aims to provide
service quality able to bring peace of mind through preparations
that include vehicles, equipment and fixtures repeatedly inspected
so that shipments from collection to delivery can be transported
at cold or frozen temperatures. We use vehicles that support
three temperature levels, dedicated cool vehicles or “cool boxes”
when using vehicles that transport items at normal temperaturesfrom collection through shipping. All of our sales offices are fully

equipped with cold or frozen warehouses. We use our alliancepartner Nichirei Logistics Group cooling facilitates to sort shipments
by delivery area. We use cool shoulder bags for delivery from thetruck to the door of our delivery destination to thoroughly manage
the temperature throughout the entire process from when wecollect a package until we deliver it.

Hikyaku Cool Express System

Sender21

Collection

Outbound Sales Offices

Route Transport

Relay Site

Collected in a dedicated cool vehicle orvehicle that supports three temperature levels

All sales offices fully installedwith cooling equipment

Transport between outbound sales office
and relay site in cool vehicles

Sorting by delivery area
at Nichirei Logistics Groupcooling facilitates around Japan

Destination

Delivery

Delivery Sales Office

Route Transport

Taken to the door
in a shoulder bag
for delivery

Delivery in a dedicated cool vehicle,
vehicle that supports three temperaturelevels or cool boxes

Sorting by each area in coldand frozen warehouses

Transport from relay site to delivery
sales office in cool vehicles

Temperature levels
for transport

Cool: 2˚C to 10˚C at a standard of 5˚C / Frozen: -18˚C or colder

Available shippingsizes

A total size of 140cm or less on three edges /weight of 20kg or less

SG HOLDINGS GROUP CSR Report 2017

冷 凍

-18℃以下品
名お受け取りしだい冷凍庫にお入れください。
ご利用ありがとうございました。

Providing High Quality Services with a Foundation in Safety

Developing and Providing Products and Services from a Customer Viewpoint
Proposals All the Way Through Office Coordination

Same Day Delivery Service for the 23 Tokyo Wards

SG Moving has officially begun total coordination services frominterior design and furniture arrangement to wiring connections ofoffice equipment related to office moves. Sales of office furnituresuch as desk partitions and cabinets is also underway side-by-side
with our coordination services.
We are proposing comfortable and work-friendly office designs
that incorporate a female perspective with five female CAD
operators* currently registered.

As same day delivery needs grow in recent years together withshipping needs from remote places, Sagawa Express has started
same day delivery services for the 23 Tokyo wards to delivery
shipments arriving by air the same day to the 23 Tokyo wards from2016. The delivery of cargo arriving at Haneda Airport by 14:00
can be completed by 18:00, while that arriving by 17:00 can becompleted by 21:00 with the use of Hikyaku Air Express (delivery toindividual residences is not possible).

*A CAD operator is a technical person who designs and proposes spaces by using CAD (ComputerAided Design) for architectural products.

Promotional flyer for the same day delivery
service for the 23 Tokyo wards

Reflecting Customer Feedback in Corporate Activities
Mechanisms for Fully Applying Customer FeedbackAward of Excellence in the All Japan Telephone Manner Competition

Sagawa Express is working to enhance mechanisms to leveragethe valuable feedback of our customers in service improvements aswell as product and service development.
We specifically and finely classify the feedback the company
receives from customers using text mining technology andvisualize the claims and requests to use to improve customer
satisfaction.
In the future, we will work to further improve our mechanisms
by even analyzing the company’s response to customer opinions
and feedback in customer satisfactions while we take the precisionof our analyses to the next level.

Sagawa Express is also focusing on improving skills talking on
the telephone.
We hold telephone manner education and training as well as
examine telephone manners of staff at sales offices throughout
Japan. (check and instruct employees about the first words when
picking up the telephone and the level of employee understandingof products).
In addition, we have participated in the All Japan Telephone
Manner Competitions held by the Public Interest Incorporated
Foundation Japan Telecom Users Association with consecutive
wins in 2014 and 2015. In 2016, three of our employees out ofroughly 14,000 competitors were presented with awards of
excellence.

Breakdown of Improvement Requests
System 1.8%

Other Ventures
14.6%

Collection 1.8%
Product accidents
3.0%
Manners
15.7%

Delivery
63.0%
Seven employees from Sagawa Express competed in the 2016 Telephone Manner Competition.
Three were presented awards of excellence.

SG HOLDINGS GROUP CSR Report 201722

Providing High Quality Services with a Foundation in Safety

Initiatives of Overseas Corporations
Toward Safe Driving and Accident Prevention (Singapore)
SG Sagawa Ameroid (Singapore) established a safety committee
in 2015 and has been advancing initiatives in accordance with the
Health, Safety and Environment Policy.
This committee opened monthly department inspections andweb portal systems (reporting systems such as for accidents)
to facilitate understanding about the problems of each issue
and launch measures and prevention plans. Moreover, we areprogressing with the adoption of systems to educate drivers andanalyze driving as well as equipping vehicles with high-resolution
cameras with the goal of monitoring drivers and other aspects of
the road.

Check System Materials for Driving Conditions

Main Initiatives
1 Include vehicle and forklift inspections in the daily reports of each driver2

Inspect warehouses, offices and other facilities monthly through safety
management committee members

Emergency Response Pocket Cards

3 Conduct lectures related to safe driving as well as evasive driving training

to avoid dangers for all of our drivers (utilize a check system for driving
conditions)
4 Formulate procedures to respond to emergencies such as vehicle damage,disasters and accidents as well as to comply with relevant laws (distribute
portable pocket cards)
5 Equip all vehicles with safety equipment such as triangular indicators, safety

vests, first aid kits and fire extinguishers to use in breakdowns and accidents

COLUMN

Smart Import® International Integrated Shipping Service for Japan
Smart Import® is a service related to international imports fordelivery in Japan after logistics processes such as the receipt,
inspection, sorting and adhering of domestic shipping invoices
to products at local distribution sites for business operators
who have production locations in countries around Asia.
Customers can reduce labor as well as returns of defects andcustoms costs in Japan by completing these logistics processes
overseas. This allows shorter lead times and cost optimization.

We started to provide services to apparel companies thathave production locations in China through an alliance with
Hitachi Transport System Group in October 2016. We have now
begun services from group sites in Vietnam. In the future, wewill expand the range of the products that we handle to suitthe needs of our customers in addition to our plans to expand
our services from Bangladesh.

Smart Import Service Scheme with Hitachi Transport System (China)
Inspection
Sorting
Adhering Domestic
Shipping Invoices

Reducing Lead Time
Reduce sorting operations andthe time for domestic shipping
operations at domestic centers

Optimizing Costs

Hitachi Transport
System Group
Overseas
InspectionCenter
Factory23

SG HOLDINGS GROUP CSR Report 2017

Overseas
HarborJapanese
HarborSagawaExpress
Relay Point

DeliveryDestination

 Reduce costs through overseas
transfer of logistics processprocedures (inspection, metering,
store sorting, etc.)
 Reduce expenses such as thecosts of returning defects andimport duties through inspection
and metering overseas

Promoting Business Activities with the Goal of Environment-Friendliness

Get to areas that have heavy
snowfall with “+ Railway”!
This services offers shipping through truck plus railway transport.
The combination of these two types of services increase energy savings and environmental efficiency.
Furthermore, these services also eliminate delays and reduce the burden on drivers caused by traffic andbad weather. The alliance between the Hokuetsu Express Corporation and Sagawa Express that started in2016 is taking on a new endeavor to switch shipments to railway transport between Uragawara (Joetsu
City, Niigata) and Muikamachi (Minami Uonuma City) on the Hokuhoku Line. This system ensures deliveryof shipments to residents in areas with heavy snowfall.

SG HOLDINGS GROUP CSR Report 201724

Reduction of CO Emissions Throughout the Entire Distribution System
CO Reduction Initiatives
SG Holdings Group is working to reduce COemissions throughout the entire distribution
system.
The major points promote (1) adoption ofenvironmentally-friendly vehicles, (2) greater
logistics efficiency that includes “Smart Delivery®,”(3) a modal shift that switches to rail or sea thathave lower CO emissions, (4) efficient use of
warehouses and (5) collection of shipments bybicycle or hand carts from the closest service
center. As a result, CO emissions in fiscal 2016
were roughly 439,000 tons (100.6% comparedto the previous fiscal year). In addition, Sagawa
Express was one of the first companies in theindustry to publicly disclose information on“other indirect emissions (Scope 3)” in addition
to information on its “own emissions (Scope 1,
Scope 2)” to visualize emissions throughout theentire supply chain.

Initiatives to Reduce CO2 Emissions Throughout the Entire Distribution System

5 Ecological
Point
Carrying shipments by bicycleor hand carts
from the “service center”“Greater logistics efficiency”

トラックの台数をsuch as a reductionin the減らすなど
number of trucks「物流の効率化」

Sales Office/Distribution
Center

1 Ecological
Point
Transport by“environmentally-friendly
vehicle” with low CO2
emissions

3 Ecological
Point

Freight terminal
Sales Office/Distribution
Center”Modal shift” that carriesa large電車や船でvolume by rail or sea.

たくさん運ぶ「モーダルシフト」

4 Ecological
Point

Distribution center

Reduce the number of times
倉庫で預かりshipments
are movedand sent
from warehouses
運ぶ回数をDeliverydestination

減らす

Electric vehicles

CO Emissions Throughout the Supply Chain (Fiscal 2016)[Sagawa Express]

Trends in CO Emissions(10,000 tons)
44

Large-scale
hub facility

2 Ecological
Point

ClientSagawa Express
Total for all other group companies (domestic)
4.59

40

4.48

Company-owned
vehicles272,728t-CO2
23.4%

4.24

36
32

Other
supply chain
770,737t-CO2
66.0%

28
24
0

39.23

39.39

38.72

39.19

39.70

2012

2013

2014

2015

2016

Company-owned
facilities
124,304t-CO2
10.6%

データ未

(FY)

Trends in Total CO Emissions*Data for fiscal 2014 and later includes all domestic emissions of the SG Holdings Group,
while data up to fiscal 2013 includes only the emissions of Sagawa Express.

Introduction of Environmentally-friendly Vehicles
Sagawa Express owns a total of approximately 9,172 vehicles(roughly 40% of the total number) that include post-new longterm regulation compliant vehicles, compressed natural gas (CNG)
trucks, hybrid trucks, and electric vehicles. Among them are 3,778
compressed natural gas (CNG) trucks (3,791 trucks throughout theentire Group) as well as 305 hybrid trucks, and Sagawa Express wasrecognized as the top company in the world in terms of numberof such trucks owned in 2011 (International Natural Gas Vehicle
Association).
Also, Sagawa has private-use natural gas filling stations setup
in 22 locations across the country, and is also independently
promoting infrastructure arrangements. As a means ofenvironmental friendliness for large vehicles, it introduced fivelarge CNG trucks in March 2014, ahead of the rest of the industry.
Furthermore, it is actively striving to reduce environmental impact
with measures such as introducing 16 electric vehicles (EV).

Natural Gas Trucks¢ Number of Environmental-friendly Vehicles (Sagawa Express)

9,172
As of Fiscal 2016

Vehicles25

SG HOLDINGS GROUP CSR Report 2017

Promoting Business Activities with the Goal of Environment-Friendliness

Promotion of Greater Logistics Efficiency
Smart Delivery®

Sagawa Ryutsu Center (SRC)

Sagawa Express has been expanding the “Smart Delivery® ”
services to dramatically increase efficiency from procurement(stocking) deals between companies to receipt of goods(warehousing/inspection) since 2014. We are contributing to the
reduction of the human load as well as the environmental burdenof our customers by delivering shipments in a designated intervalof time, even after midnight or early in the morning, and by
conducting the primary sorting before delivery, such as by productcategory or by location before shipping at relay centers, sales
offices or other Sagawa Express sites. The service is implemented
in places such as large distribution centers for volume retail storesand large-scale shopping malls.

Sagawa Global Logistics operates and administers Sagawa
Distribution Centers (Sagawa Ryutsu Centers = SRCs), logistics
facilities directly connected to Sagawa Express Sales Offices.
SRC centrally manages products and conducts operations suchas storage and logistics processes. We are saving energy andreducing CO, NOx and PM by eliminating truck transport between
each process.
Active efforts are also being made to reduce environmental
impacts, such as by thoroughly separating and collecting wastematerials produced by logistics processes, promoting theirrecycling, and proposing packing with environment-friendly
materials.

Facility Logistics

SRC Transport Flowchart
Conventional Distribution
Warehousing
Inventory

Sales Office

Product
Line-up

Sales Office

Supplier

Shipping Inspection
Picking

Shipping
Destination
DeliveryDistribution Using the SRC Model

Picking

Inventory

Sales OfficePacking

Product
Line-up

Tagging

Supplier

Sales Office

SRC
Shipping
Inspection

Sagawa Express and World Supply provide “facility logistics
systems” that centrally manage people, goods and information(including vehicles) entry and exit such as at large-scale multicomplex facilities to promote greater efficiency in logistics. We
have been entrusted with 84 properties (as of May 2017) in total,
including Tokyo Skytree® and Tokyo Midtown. The adoption offacility logistics systems help aggregate delivery vehicles, mitigate
traffic jams around facilities and reduce the environmental burden.
The effectiveness of these systems earned a certification from theTokyo District Distribution Efficiency Certification System as well as
the outstanding Green Logistic Partnership Business award.

Shipping
Destination
Delivery

3PL Function + Sagawa Express Sales Office
Reduction

Reduction

Convenient Store Pick-up Service
The Convenient Store Pick-up Service started in 2015 by Sagawa
Express is a service to pick up products purchased on e-commercesites registered for use in advance 24-hours a day at roughly 12,000
Lawson stores (excluding Lawson Store 100) throughout Japan.
This service is popular with people living alone, double income
families and women who do not like deliveries at night, and it
is contributing to the reduction of the burden on drivers and toenergy savings by reducing re-deliveries.
Delivery at Tokyo Solamachi® in the Tokyo Skytree Town®

¢ Number of Indoor Logistics System Outsourcing Contracts

84

As of May 2017

Properties¢ Number of Companies Registered to Use the Convenient Store Pick-up Service

2,143
As of May 2017

Companies

SG HOLDINGS GROUP CSR Report 201726

Promotion of Modal Shift
Super Rail Cargo

Mixing Freight and Passengers on Hokuetsu Express

Sagawa Express has been carrying out door-to-door delivery
transport via Super Rail Cargo express railway container cars
developed jointly with Japan Freight Railway Company since 2004.
One train runs both to and from Tokyo and Osaka late at night eachday. These trains transport roughly 10% of the total shipping volume
between Tokyo and Osaka. The total volume of each train travelingbetween Tokyo and Osaka is equivalent to 56 ten-ton trucks. Thismodal shift also largely driving the effectiveness in reducing theenvironmental burden such as lowering CO emissions.

Hokuetsu Express Corporation and Sagawa Express agreed toinitiatives to mix freight and passenger operations and conducteda test in June 2016. We began official operations in April 2017 witha new trial that switches shipments to railway transport between
Uragawara (Joetsu City, Niigata) and Muikamachi (Minami Uonuma
City) on the Hokuhoku Line.
The combination of truck plus railway transport increases energy
savings and environmental efficiency. Furthermore, these services
eliminate delays caused by traffic and bad weather and also reducethe burden on long distance drivers. This system ensures deliveryof shipments to residents in areas with heavy snowfall.

Express Railway Container Cars "Super Rail Cargo"

Total Volume One-way Between Tokyo and Osaka

56

10t Trucks

Trucks“Hyokan Soko” Renovation Container
Sagawa Express, Japan Freight Railway South-Kanto Logistics
Company, Japan Business Operator Federation and O’s & Tec are
conducting a joint trial on railway cargo transport using “Hyokan
Soko” (railway container with temperature control) renovation
containers. “Hyokan Soko” is the addition of cold and frozen storage
functionality to universal railway containers that helps reduce theenvironmental burden by allowing railway transport for shipments
such as fresh fish, which are easily damaged and could only be sent
by air up until now.

Departure Ceremony

Service Centers
Sagawa Express has established Service Centers (SC) that
perform collection and distribution without using trucks such aswith hand carts or bicycles at 325 locations throughout Japan. Eachlocation is able to limit the use of three to five vehicles and reduceCO emissions and other air pollutants of 1,500 vehicles across allof these service centers.
In addition, the service centers at the Yaesu Exit of Tokyo
station, Shijo Takakura, Kyoto, Hakata Station Eki-mae 1-chome,
Tokyo Service Center, Gion Sagawa Express and six operation sitesof sales offices in Kyoto (Fuyacho) are acquiring Carbon Neutral
Certifications* through the carbon offsetting policy of the Ministryof the Environment.
*Carbon offsetting is an initiative to balance the amount of CO that is reduced or absorbed inanother area with CO emissions in business activities.

“Hyokan Soko” that manages a standard temperature via external power when stored and secondary
battery power when in transport

27

SG HOLDINGS GROUP CSR Report 2017

Tokyo Station Yaesu Exit Service CenterPromoting Business Activities with the Goal of Environment-Friendliness

Environmentally-friendly Logistics Facilities

Encouraging Transition to LED Lighting

SG Realty is promoting the clean energy supply business. Ourgroup is involved in solar power generation at 98 distribution sites
and logistics centers throughout Japan with the goal of a stablesupply of electric power and the reduction of the environmental
burden. The total area of the panel installations is roughly
₂
191,000m and the total power generated annually is approximately
27,000MWh. This is equivalent to a reduction of about 14,024 tonsof CO emissions compared to that generated through meansother than natural energy.
In 2015, SG Realty Higashi-Matsuyama, which is anenvironmentally-friendly logistics facility completed in HigashiMatsuyama, introduced a state-of-the-art solar power generation
system. The output is 2,000kW, which is the largest amount of
power generated in the group. SG Realty Higashi-Matsuyama alsoacquired the CASBEE certification (rank A). Our efforts that include(1) our friendliness to the environment such as the installationof LED lighting and solar power generation panels, (2) greatertransport efficiency through a structure able to connect outboundcenters and warehouse areas and (3) the establishment of anenvironment easy for employees to work such as a break corner forthe employees of tenants were highly praised.

Sagawa Express is encouraging the introduction of LED lighting
at sales offices and large logistics facilities. We have been able toeffectively reduced CO emissions by roughly 4,500t by introducing
LED lighting at 131 locations (previous year + 110 locations) in fiscal
2016. This has great energy-saving benefits of about 5% of theenergy consumption used throughout all of Sagawa Express.

¢ CO Reduction by Introducing LED Lights

4,500
As of Fiscal 2016

Approx.

t

COLUMN¢ Number of Solar Panels (All 98 Facilities)

134,614
As of Fiscal 2016

Panels¢ Power Output Generated by the Solar Power Generation
System of SG Realty Higashi-Matsuyama

2,000

kW

1st for Two Consecutive Years in theTransport Category Ranking of theEnvironmental Management Survey
Sagawa Express has been ranked 1st two years in a row
in the transport category of the 20th Nikkei Environmental
Management Survey conducted by the Nihon Keizai
Shimbun in February 2017. This survey evaluates initiatives
based on both environmental measures and managementof the company. Sagawa Express was praised for its
initiatives overall in both hard aspects that included theadoption of vehicles to reduce the environmental burden
and soft aspects such as efficient warehousing operations.
These initiatives earned us a highest score in two of the four
evaluation indexes set for the transport category.

¢ Nihon Keizai Shimbun “Environmental Management
Survey”
Fiscal 2015

Fiscal 2016

1st 1stTwo Consecutive
Years

SG Realty Higashi-Matsuyama equipped with a solar power generation system

SG HOLDINGS GROUP CSR Report 201728

Aiming for a Recycling-oriented Society
Enhancement of Reverse Solutions

Adoption of Eco-friendly Uniforms

The SG Holdings Group is contributing to the constructionof a recycling-oriented society by providing a variety of “reverse
solutions” that utilize reverse logistics.
Sagawa Express is expanding Home Pick-up Services for Used
Small Home Appliances based on the Home Appliance Recycling
Act since 2015 as an outsourcing business from ReNet Japan Inc.
The Home Appliance Repair Center at the Sagawa Tokyo Logistics
Center is also involved in a Home Appliance Repair Service thatoffers a one-stop solution from the pick-up to the actual repair andreturn of devices.
Sagawa Express Vietnam is expanding recycling services forconfidential materials with the cooperation of JP Corelex Vietnam
paper recycling manufacturer. This system recycles confidential
materials collected by Sagawa Express Vietnam by melting thosematerials at a JP Corelex Vietnam plant to produce toilet paper forpurchase by the place where the recycled paper originated. We arerecycling several tons of confidential documents annually centered
upon Japanese corporations in Vietnam.

SG Holdings Group is furthering green purchasing in which
products with a low environmental burden are chosen.
As one component of this effort, Sagawa Express uniforms haveadopted EcoMark-certified products made by recycling plastic
bottles. In fiscal 2016, we purchased roughly 227,000 uniforms(equivalent to roughly 1,130,000 bottles of 500ml plastic bottles).
Used uniforms that cannot be easily reused are collected andrecycled as blast furnace reductants for ironworks. We have alsopurchased about 523,000 EcoMark-certified gloves in fiscal 2016 forSales Drivers®.

Contributions through EcoMark-certified uniforms
As of Fiscal 2016

Plastic
Bottles

1,130,000

Bottles

Environmental Awareness for the Next Generation
Environmental Awareness for the Next Generation
Nature Experience Training
Sagawa Express is continually holding nature experience
training at the Takao 100-Year Forest (in Tokyo) for children who
will represent the next generation to learn about connections
between nature and people through undeveloped woodlands. In
fiscal 2016, there were roughly 500 participants who experienced
activities from hikes in the forest to thinning and chopstick making
from the thinned wood. These initiatives became the first example
in Tokyo to be recognized as a “Place for Experience Opportunities”
based on the Act on Enhancing Motivation on Environmental
Conservation from Hachioji City, Tokyo.
Moreover, we have been conducting rice cultivation experiencesin rice fields in Moriyama City, Shiga Prefecture since 2007 to help

children realize the bounty of nature, the importance of food, andlearn about the vibrant ecosystem living in rice fields. Employees,
their families and local residents experienced traditional rice making
such as the planting, harvesting and drying of the rice on racks. We
are also involved in activities tosupport the Fish Nursery Paddy
Field Project promoted by Shiga
Prefecture, where “nigorobuna”(round crucian carp), a type offish indigenous to Lake Biwa,
are raised in rice fields and thenRice cultivation experience activity
released.

Eco-Art Contest
SG Holdings and Sagawa Express have held the National Eco
Art Contest (with backing from the Ministry of the Environment)
since 2014 with the goal of raising awareness about theenvironment in the next generation. In 2016, we received 14,398
entries of works around the theme to protect our Earth. 52 ofthese pieces received awards with two selected as outstanding
works (Ministry of the Environment Minister’s Award). These twopieces were used for the wrapping design on 80 Sagawa Express
trucks driven mainly in major metropolitan areas throughout

29

SG HOLDINGS GROUP CSR Report 2017

Japan since March 2017.

Outstanding works; underclassman (left) and upperclassman (right)

Promoting Business Activities with the Goal of Environment-Friendliness

Preservation and Environmental Awareness of Forests and Biodiversity
Forest Preservation Activities
The functions of forests are indispensable to the life of animals
such as the absorption of CO, prevention of erosion, cultivationof water resources and the preservation of biodiversity. Demandfor domestic timber is decreasing in Japan due to liberalization ofimport timber while the country offers an extremely rich wealth offorest resources. The forest industry tasked with preserving these
forests is faced with an extremely strict environment. Therefore,
many forests are unable to manifest their conventional functions
to become a challenge because sufficient management cannot bedone such as thinning to weed out trees at the appropriate time.
Sagawa Forestry owns a rough total of 685 hectares of Sagawa
Forests in seven locations in Kochi and Tokushima in Shikoku.
The company carries out conservation activities such as thinning
together with local forestry associations and works toward
cultivating revitalized forests bathed in sufficient light able toabsorb CO. We aim to engage in business activities that help
use thinned trees in various ways such as construction materials
and biomass fuel, further the operation of a healthy forest cycle,
revitalize the region and create jobs.
Furthermore, the J-ver certification committee acquired 5,440
tons of carbon offset credits in 2011 to use in Sagawa Express
transportation and to reduce CO emitted when holding
environmental events that the group participates.
At the Takao 100-Year Forest (in Tokyo), activities for thecoexistence of people and nature, to restore and preserve
undeveloped woodlands that can be sustained for 100 years, began
in 2007. The restoration of undeveloped woodlands in fields richwith the splendor of nature, valuable for mitigating global warming
and where people and nature can exist in harmony, carried out
by the cooperative efforts of numerous parties including citizens,universities and other educational institutions, academic experts,
and NPOs, are symbolized by the phrase “100 years”, with the
project proceeding on an unhurried, natural time scale.

Everyone at the Forest and Kami Forest
Association in Tosayamada, Kochi Prefecture¢ Size of Sagawa Forests*

Tokyo Dome

160

Approx.

Tokyo Domes*Calculated as a total of 735 hectares combining Sagawa Express and Sagawa Forestry

Forest preservation activities

Coastal Preservation Activities (Sri Lanka)
Classic Travel, a travel company in the ExpolankaGroup, held the Classic Wavez coastal preservation
project in Sri Lanka. This project aims to protect the
beautifully rich coasts, conserve biodiversity andsustain the tourist resources through four activities
from beach cleaning and the installation of garbagecans to planting of mangrove trees, environmental
awareness lectures at universities as well as therelease of sea turtles.
Planting more than 1,250 mangrove trees

Beach cleaning

SG HOLDINGS GROUP CSR Report 201730

Contributing to the Development of Communities

Cheer for the Future The Driving Force of Today
We cheer for the children who hold the future in their hands.
The Kids Sports Camp held by SG Holdings is a program to nurture sociability such as competitiveness,
rules and teamwork through sports. Every smile brighter from the three night four day camp is marvelous.
In addition, our programs are fulfilling the great curiosity of the children with various sports clinics, traffic
safety education, experience-based learning that teaches logistics systems and much more.

31

SG HOLDINGS GROUP CSR Report 2017

Contributing to the Development of Communities

Supporting the Foundations of Local Communities
Comprehensive Regional Revitalization Partnership Agreements with Local Governments
In recent years, regional vitalization has become a prominentissue. Many local governments are actively advancing initiatives inattractive urban development convenient for people to live.
Sagawa Express is furthering comprehensive partnershipagreements on regional revitalization with local governments byleveraging its broad logistics network across Japan. We first enteredinto a partnership agreement with Kyoto in March 2016 and haveconcluded other comprehensive partnership agreements onregional revitalization with eight prefectures and four cities as ofMarch 31, 2017.
In addition to the initiative to revitalize each region such as
contributing to tourism through the promotion of “Sightseeing
without Baggage” as well as building a system to assist in the

distribution of local products and sales promotions as part of these
agreements, we are linking to and working with local governments
to support the realization of building secure cities that are easy
to live in from various angles, such as efforts in transport of relief
supplies in disasters, initiatives for disaster recovery assistance, theeducation of children and youths, support of elderly and people
with disabilities and environmental preservation.

Success of Comprehensive Regional Revitalization
Partnership Agreements
March 2016

Kyoto Prefecture

February 2017 Kagoshima Prefecture

March 2016

Yamanashi Prefecture

February 2017 Miyazaki Prefecture

August 2016

Osaka Prefecture

March 2017

Niigata City

August 2016

Yokohama City

March 2017

Kumamoto City

August 2016

Tochigi Prefecture

March 2017

Gunma Prefecture

March 2017

Shimane Prefecture

October 2016 Okayama City¢ Success of Comprehensive Regional Revitalization Partnership Agreements

2

Fiscal 2015

Ceremony celebrating the agreement with Kyoto

12

As of March 2017

Agreements

Agreements

Promotion of Sightseeing without Baggage
The promotion of “Sightseeing without Baggage” is included as partof the compressive agreements executed with each local government.
This is a service to collect the baggage tourists bring with them anddeliver it to a desired place so that they may enjoy sightseeing without
the burden of baggage. 11 Sightseeing without Baggage countersthroughout Japan run by Sagawa Express have been recognized by
the Ministry of Land, Infrastructure, Transport and Tourism (*as of April
17). As the number of tourists visiting Japan grows, the promotion ofsightseeing without baggage helps promote tourism and revitalize
regions in metropolitan and tourist areas.

Enjoy Sightseeing
Without Baggage!

Purchase a productand leave the baggage

Sagawa Express
Shipping Counter

Sightseeing, shopping, etc.

Pick-up the baggagethat was sent
the same day

Baggage

Luggage is sent to Narita Airport
on the same day

Narita Airport
Shipping Counter

Customer

Limousine Bus
StopTokyo Airport Transport Service andSagawa Express began packaging sightseeing
without baggage and limousine bus services.
Customers can leave their baggage at a
Sagawa Express shipping counter (Tokyo
Station, Asakusa Kaminarimon, Tokyo Skytree®)and enjoy sightseeing without the burden of
their luggage until they catch a limousine bus
to Narita Airport.
The shipping of the baggage we havecollected is extremely efficient because it
is transported using the cargo space of thelimousine buses rather than a vehicle from
Sagawa Express.

Tokyo Service Counter
with Sightseeing without
Baggage services

SG HOLDINGS GROUP CSR Report 201732

Safety Awareness Initiatives
Sagawa Express holds Sagawa Express Traffic Safety Classes
taught by Sagawa employees in every region, in an attempt toprotect our children from tragic traffic accidents. Course content
includes how to properly cross the street and the meanings ofroad signs and traffic signals. Subjects such as truck blind spots
and examples that are likely to lead to accidents are explained with
impact by using actual trucks as examples.
We responded to a request for cooperation from the local
police from the perspective of protecting the safety of children
throughout the entire local community. In fiscal 2016, these classes
were held 985 times throughout Japan with the participation of
more than 97,606 people.

¢ Number of Participants in Traffic Safety Classes

97,606

As of Fiscal 2016

Traffic Safety Education

Initiatives with Lawson, Inc.
The SG Holdings Group created a business alliance with Lawson,
Inc. in 2015 and established the SG Lawson, Inc. joint venturecompany. The business delivers Sagawa Express shipments andLawson products within 500m of a Lawson store by hand cart orbicycle. We can expect this to reduce the environmental burden
and promote the employment of parents and seniors who want towork close to home. A trial run is ongoing mainly in the Setagaya
area of Tokyo and we are looking into expanding to other areas
throughout Japan.
In addition, we are expanding mobile shops for customers who
have difficulty shopping at some Lawson stores. SG Motors is
supporting the mobile shop business through sales of specialized
vehicles.

SG Lawson deliveries by hand cart and bicycle

Opening of the Nagasaki Business Support Center
SG Expert, which is in charge of management such as theadministration and accounting in the SG Holdings Group, opened
the Business Support Center in Nagasaki City with the goal ofstrengthening measures in our Business Continuity Plan (BCP) fortimes of disasters and for securing a stable base of excellent humanresources. This center is the largest regional site for SG Expert andthe first example of Nagasaki Prefecture certifying the regionaltransfer and expansion of headquarter functions advocated by thegovernment. SG Expert plans to hire 150 locals by the end of fiscal
2018 to contribute to job creation in the region.

33

SG HOLDINGS GROUP CSR Report 2017

ParticipantsContributing to the Development of Communities

Community Interaction Through Sports Events
Initiatives Supporting Sports
SG Holdings Group is striving to support the development of thenext generation through sports.
We have held the SG Holdings Kids Sports Camp at ourMoriyama Park athletic facility since 2016. Top Athletes including
Yuko Arimori (marathon runner), Kana Oyama (volleyball) and Taeko
Utsugi (softball) came as instructors to teach the 49 elementary
school students who participated the fun of exercise, teamwork
and the importance of following the rules through sports.
Since 2016, we have also been sponsoring the All-Japan HighSchool Ekiden Championships held annually during December in
Kyoto and have supported the active participation of young highschool marathon runners entrusted with the next generation.

Sagawa Express presides over the Sagawa Shiga Football
Academy held in Moriyama. We are supporting the healtheducation of local children through soccer by running a junior
youth team for junior high school students as well as a soccer
school for kindergarten and elementary school children. Handson soccer events are also being held at kindergartens in Moriyama
City. In fiscal 2016, 1,024 kindergarten students enjoyed soccer at
15 different events.
The group is also building an environment where athletes whowant to continue sports can actively participate. We are cultivating
a sense of unity in the group by cheering on the athletes who arecolleagues on our track and field as well as softball teams that are
official SG Holdings sports clubs.

Kids Sports Camp (2016)

Official Sports Clubs

Track-and-Field Team

Softball TeamAll-Japan High School Ekiden Championship (2016)

Sagawa Shiga Football Academy

Provided by The Mainichi Newspapers

SG HOLDINGS GROUP CSR Report 201734

Supporting Academics, Culture, and Next-generation Education (Foundation Activities)
SGH Public Interest Foundation
With the goal of contributing to multifaceted and extensivesocial activities for the creation of a global and active society, the
SGH Public Interest Foundation assists with research and businessactivities to promote and develop fields such as economics,
industry, education, culture, medicine, and social welfare.

Study Abroad Scholarships
We provide scholarships to privately financed international
students from countries in Southeast Asia. Since this project
began in 1986, 494 students have been selected, with the totalmonetary amount of scholarships provided reaching 1,113 million
yen. In addition to granting scholarships, we are also striving toenable international students to enjoy a rich experience in Japanby publishing written anthologies and holding award ceremonies,
social gatherings, and reunions.
During fiscal 2016, 92 students from 79 universities all over thecountry applied, of which 19 applicants were selected as our 31st
term scholarship students.

Commemorative photograph of
Chairperson Eiichi Kuriwada andthe scholarship students

International Economic Cooperation
We donate transport vehicles to developing and emerging
countries in Asia, and accept trainees to study vehicle maintenanceskills.
In fiscal 2016, we donated vehicle maintenance equipment
to Laos with the goal of improving the maintenance of trucks
that have been donated up until now as well as the skill of thetechnicians.
We accepted six trainees from China and five from Laos to study
vehicle maintenance skills. In addition, with the cooperation of the
Ministry of Land, Infrastructure and Transport and Tourism, we held
intensive logistics courses at the National University of Laos and theMinistry of Public Works and Transport Training Center as a venture
to support the development of logistics human resources.

Class at the National University of Laos

Cancer Research Support

Sagawa Art Museum Public Interest Foundation

We are involved in activities such as offering support andawards to research on basic cancer studies and applied treatments,
holding cancer-related lectures and publicly-open citizen courses,
and publishing reports on research results.
In fiscal 2016, 201 applications were received from research
institutions nationwide, and we provided support to 15 of them.
We also presented the SGH Special Award and the SGH Nursing
Care Special Award to people with distinguished achievements incancer research and the development of nursing care, who also
have high promise for future developments.

In March 1998, the Sagawa Art Museum was opened in
Moriyama City, Shiga Prefecture. The Museum also holds speciallyplanned art exhibitions, focusing on permanent exhibitions of theworks of Ikuo Hirayama, Churyo Sato, and Kichizaemon Raku. The
Museum also promotes education through events such as Sagawa
Kids Museum and concerts, to cultivate aesthetic sensibility thatcreates abundant senses of expression and sensitivity.
*Total number of visitors in fiscal 2016: 130,039

28th SGH Cancer Research Grant/15 projects (15 million yen)
14th SGH Special Award/2 projects (10 million yen)
14th SGH Nursing Care Special Award/2 projects (2 million yen)

SGH Special Award
Ceremony35

SG HOLDINGS GROUP CSR Report 2017

Sagawa Kids Museum Cardboard Art Amusement Park (2016)

Contributing to the Development of Communities

Local Contribution Activities of Expolanka (Sri Lanka)
Eyes of Hope Project

Making Sustainability Possible in the Rathugala Region

The Eyes of Hope Project, which has been underway since 2014,is a project working to reduce the risk of blindness due to abnormal
refraction of light in the eye and cataracts.
In 2016, we opened free eye clinics in four locations inconjunction with World Sight Day to raise awareness about theimportance of an early diagnosis. More than 300 elderly patientswere examined and many were given glasses.
30 of the patients who were examined discovered they needed
to have cataract surgery. The total costs of these treatments were
paid by Expolanka. 100 patients have been helped since thebeginning of this project thanks to these efforts.

We have been working to improve the living standards for theindigenous people in the Rathugala region since 2014. First, we
installed water supply to use as a water source available at any
time to 150 households in the community, which had difficulty
accessing clean water, as well as schools and Buddhist temples.
Furthermore, we built a museum to display artifacts passed
down through the generation in February 2017 as a measure to
support the independence of the community.
This initiative aims to earn an income for and develop asustainable community by encouraging tourism in the region.

Patients suffering from cataracts

Water supply established at a school

EXPO MEDIX Health Support Program

Expanding the Bulb for Bulb Campaign to Celebrate World Environment Day

EXPO MEDIX health and lifestyle support program
symbolizes the essence of Expolanka Group’s CSR activities.
This program performs examinations and simple surgicalprocedures as necessary at clinics well-featured with medical
systems used by doctors and nurses for low-income families
who cannot afford expensive private medical care. Assistanceis also provided for the pharmaceutical costs together with
our efforts in medical care.
Today, an average of 200 patients are examined weekly ateight clinics.

As part of our sustainable environment project, we
replaced incandescent light bulbs with LEDs for employees
as well as households in the Orugodawatta area to celebrate
World Environment Day. Expolanka Freight (EFL) has alreadyreplaced 4,000 old incandescent light bulbs up until now.
Used bulbs are being disposed of in a safe manner.
Moreover, we raised awareness in participants aboutengaging in other types of power saving efforts, such as theuse of rain water and recycling.

Patient being examined through EXPO MEDIX program

One aspect of the Bulb for Bulb Campaign

SG HOLDINGS GROUP CSR Report 201736

Building an Organization with Individuality and Diversity

Being Able toContinue Working
Realizing diversity and inclusion is the key to growth as a company.
We are driving initiatives in diversity throughout the entire group so that diverse human resources fromwomen and global human resources to seniors and people with disabilities can continue to actively
participate. SGH Kids Garden, which opened in April this year, is the Group’s first in-house nursery school.
This is one way we are encouraging working parents to continue to work. Different people have a wide
range of values as well as a variety of ideas and thoughts. Taking full advantage of this diversity is ourgreatest driving force.

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SG HOLDINGS GROUP CSR Report 2017

Building an Organization with Individuality and Diversity

Respect for Human Rights
Human Rights Initiatives

Continuing Implementation of Employee Attitude Surveys

In its code of conduct, the SG Holdings Group gives thehighest respect to various international norms including humanrights, as well as culture and customs, and clearly indicates these
considerations to its stakeholders.
We hold ethical code of conduct training for all of our employees
in group companies in Japan between April and May each yearwith the goal of cultivating an ethical perspective in our employees
as well as heightening self-cleansing through this ethicalperspective.
In addition, we hold a Harassment Prevention Month every
June in an effort to realize a positive work environment where
people can work with motivation free of harassment by respecting
the diversity, personality and individuality of each and every
employee. In fiscal 2016, our awareness raising efforts incorporated
information about maternity and social harassment, which havebecome social issues in recent years.

While promoting stakeholder management, we conduct
employee attitude surveys with the goal of understanding Group
employee attitudes, identifying issues, and making improvements.
These were held for roughly 50,000 group employees in fiscal 2016,
with results showing that the level of overall employee satisfaction
was maintained while improvements were seen on individual
issues. Based on these results, each business company will makeplans and carry out initiatives for measures to improve items withlow satisfaction.
We will continue to improve the satisfaction of our employees
in the future, and realize the creation of a positive growth cycle
connected with increasing customer satisfaction by incorporating
the opinions of our employees who also play roles as stakeholders
into management.

Establishment of the SG Holdings Group Human Rights Policy
The SG Holdings Group is committed to a corporate policy that
respects the human rights of all of our stakeholders as our businessexpansion accelerates globally. Therefore, we have established the
SG Holdings Group Human Rights Policy to broadly declare andraise awareness about our commitment both inside and outside of

the group.
This policy outlines our concepts toward human rights more
specifically based on the SG Holdings Group Code of Conduct andthe SG Holdings Group Ethical Code of Conduct.

The SG Holdings Group's Human Rights Policy
Preamble

Prohibition of Child and Force Labor

The SG Holdings Group respects and advocates the Universal

We will prohibit children, under the minimum working age

Declaration of Human Rights and its goals related to humandesignated by the laws in each country or region, to work. We

rights.

will also prohibit forced labor. Further, we request our businessThis policy on human rights expresses our stance based on ourpartners to also prohibit child and forced labor.

Corporate Charter of Business Conduct and Code of Ethics and

Avoiding being Complicit in Human Rights Abuse

Conduct in detail.

We will not be complicit in the abuse of human rights. Also we

Respecting Everyone's Human Rights

will strive to not be complicit through receiving benefits, nor

We will not discriminate on account of gender, race, religion,

silently condone being a complicity.

nationality, ethnicity, political opinion, sexual orientation (LGBT,

Responding to Occurrence of Abuseetc.), marital status, pregnancy, childbirth, medical history,
disability, or illness.

We will set countermeasures in the case of occurrence of humanrights abuse while protecting the victim and informer andLegal Compliancepromptly, and fairly, solve these issues.

We will comply with all laws in each country and region.

Safety and Health

We will comply with international rules in countries or regionsthat do not have strict laws.

Preventing Human Rights Abuse
We will build and continue to implement a system for “Human
Rights Due Diligence” (*) to prevent occurrences of human rights
abuse.
*Process to recognize the negative effects related to human rights and to prevent andrespond to them.

We will prioritize safety in the workplace and promote the healthof all employees.

Transparency and Promoting AwarenessWe will report activities of the SG Holdings Group withtransparency.
We will continue promoting awareness of the "SG HoldingsGroup's Human Rights Policy" to the employees and also request
business partners to respect and respond to human rights.

SG HOLDINGS GROUP CSR Report 201738

Diversity & Inclusion
Promote Participation of Women
The SG Holdings Group works to promote Diversity & Inclusion(D&I) to grow as a company with a competitive edge. We are
actively engaged in initiatives to promote the participation of
women in particular, such as active promotion as managers creating
new business by female employees, expanding occupational fields,
establishing relevant systems and innovating the corporate climate.

Women’s Career Support Training
The SG Holdings Group conducts Women’s Career Support
Training for female employees who are management candidates
through external instructors. Roughly 70 women participated intraining held three times during fiscal 2016.
The women learned the importance of diversity and businessskills while engaging in a discussion with executives and groupmanagers. These women also created a vision of their careers andgoals to take action to realize that vision by taking hints from thediscussion with active female managers.

WakuWaku Women’s Project
The SG Holdings Group is conducting the WakuWaku Women’s
Project across the group to promote the participation of female
employees. In fiscal 2016, we held the 3rd WakuWaku Award tocommemorate business sites working to create businesses andimprove operations for the participation of women. In addition, we
held the 2016 Diversity Forum that invited management for somevery renowned publicly listed companies as leading experts in D&I
promotion with the goal of furthering understanding about D&I inexecutive management and middle managers.

WakuWaku Awards Ceremony¢ Number of New Women Employees

244

New Graduate Employees in Fiscal 2017/767 Employees

SGH Kids Garden In-house Nursery School
The SG Holdings Group opened the SGH Kids Garden, whichis the group’s first in-house nursery school, in April 2017. It had agoal of solving children on waiting lists to enter schools, which has
become a social issue, promote the active participation of womenand support work-life balance. SGH Kids Garden achieves a levelof education and safety equal to that of a licensed kindergarten.
Substantial optional services such as laundry and towels for naps
are also available. We of course support employees to return
to work in the group while we also help aid the spouse of ouremployees to enter the workforce again.

SGH Kids Garden entrance

Thinnings from forests owned by Sagawa Forestry areplentifully used in the SGH Kids Garden kindergarten
facility and toys to create an educational space where
nature can be felt close by through the wood.

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SG HOLDINGS GROUP CSR Report 2017

Building an Organization with Individuality and Diversity

Expanding the Occupational Opportunities for WomenDiverse Work Styles

SG Holdings strives to build an environment able to actively
challenge women even in occupational fields generally filled bymen up until now, such as large truck drivers and automobile
mechanics.
Sagawa Express is promoting the introduction of swap body
vehicles with a detachable body and cargo bed. We expect thisinnovation will expand occupational opportunities for female
drivers because different staff can load the cargo and drive thevehicle.
In addition, SG Motors has adopted light tools and equipment
considering ease of use by female employees who are working onsite. We are also adapting to the diverse needs of our customers
such as expanding to a Ladies Moving service handled by our
female staff.

Employees of the SG Holdings Group practice their own
work-life management. The group is also enhancing relevant
policies for our employees to choose a work style suitable
to them. Six group companies (*) have been recognized as acompany supporting child raising by the Ministry of Health,Labour and Welfare for introducing efforts such as enhancing
programs for shorter working hours and encouraging male
employees to take childcare leave.
*SG Holdings, Sagawa Express, Sagawa Global Logistics, Sagawa Logistics Partners, SGH Global Japanand SG Systems

SG Systems engages in trials to realize telework programs tounderstand the needs of employees who want to work remotely
and confirm operations telework is viable as well as examine thesecurity of the tools it implements.
Sagawa Express is proposing work styles such as “Delivery Mate”
in which we enter into operating agreements with registrants. The
rate is determined on a piece rate plan based on a contract rate foreach parcel. The point of this program is to work at your own paceby selecting the days and times that are good for you rather thandetermining work shifts at a certain time such as part-time jobs.
Sagawa Global Logistics has setup work programs forwarehousing operations such as inspections and packaging in freetime via “Logi Shift,” which allows employees to freely choose the
day and time they want to work. The environment that has been
built is easy for part-time employees such as homemakers to work
primarily.

COLUMN

Two Diversity Awards
We are increasing the number of swap body trucks able to fully detachthe truck body and cargo bed (container area). This innovation is
expected to improve the efficiency of operations with dedicated drivers
who are not responsible for the loading and unloading of cargo.
Moreover, another aspect of this vehicle that expands driver opportunities
is a vehicle that differs from a trailer truck which only require a driver’s
license for large-size vehicles.

Diverse Human Resources
SG Holdings Group has diverse human resources who actively
work in a wide range of fields. We have roughly 5,200 employees
who are foreign nationals. Our group has put in place a system
for these employees to take advantage of work experience atsome business companies in Japan in their ongoing work attheir local company after they return home to their country. We
promote continued employment of retirees and are considering
re-employment promotion measures so that we can growopportunities able to actively leverage the experience these
employees have cultivate in their careers. The SG Holdings Group
is furthering construction of an environment able to drive theindividuality and skill of people with disabilities through means
such as learning and sharing the correct knowledge about theemployment of people with disabilities.

The late Hiroyuki Urushizaki, former President of
SG Holdings, received the logistics industry’s first
Leader Award in the 2017 J-Win Diversity Awards thatrecognizes leading D&I companies. Hiroyuki Urushizaki
contributed to promoting the participation of female
employees by spearheading the WakuWaku Women’s
Project and establishing the WakuWaku Awards.
Nouvelle Golf Club become the first golf course
recognized as a Youth Yell Certified Company by the
Ministry of Health, Labour and Welfare in October 2016.
Youth Yell is a policy for certification by the Ministryof Health, Labour and Welfare based on the YouthLabor Welfare Act to recognize small and medium
sized companies active in the hiring of youths such as
employment management.

SG HOLDINGS GROUP CSR Report 201740

Human Resources
Training Systems and Programs
SG Holdings Group relies on all of its employees to operate
independently. We have setup a variety of training systems based on
the SG Holdings Group Personnel Vision formulated with the goal totake advantage of the skills and unique personalities of each employee.

SG Holdings Group Personnel Vision

Overseas Training
Our group has a 38-year history in overseas training. Employees
who are chosen through a public offering gain a global perspectiveby visiting each country in Asia accompanied by an executive, suchas Singapore where the group has overseas businesses, observing
local companies and engaging in discussions with executive
management.

Next-generation Leader Development Training
Training is held to cultivate “human resources who create
corporate value” that are entrusted with the next generation for
mid-level employees who have been selected from assistant andsection managers.

Excellent Employee Commemoration ProgramThis program commemorates exemplary employees who haveearned an excellent track record.
An award ceremony is held together with the families of ouremployees as a place to help improve motivation of award winners
and heighten awareness throughout the entire group.

HigherMotivation

Use equal and fair
opportunities to actively
persevere again andagain without fear

Reward work toward
goals, personal
achievement andsuccess

Shining Individuality,
A Connection Mentality, and theWidening World~Challenge for Innovation~
Time
Management

Bright Future Vision Committee
This project focuses on the vision (imagination/inspiration)
young employees have for their future. This is the fourth year of thisprogram which has nurture 70 future-oriented members. We areaiming to innovate the organization with the skills and experience
gained through these committee sessions.

Fair Field

Exhibit the maximum
performance within a
set time frame to create
added value

Greater Skills
Take responsibility for one’srole and pour passion into
ongoing learning anddevelopment to grow as
an individual

Shining Individuality
We want each person to further their individuality, hone that
individuality and shine above everyone else.

Connection Mentality
Everyone shall share the same spirit and foster solidarity. We hopeto always move toward a new future without ever forgetting thespirit of a courier at the heart of our founding.

Widening World
We will take a broader view by connecting with a variety of
personalities to expand our potential. We hope to foster newvalues not only relatable in Japan but around the world.

In-house University “SGH University”
The SG Holdings Group opened SGH University as an in-house
university in March 2017. This school was established with thegoal to build an environment where employees passionate about
education who want to open avenues to their career can learn
independently to support their growth.
As an academic venue combining group training and e-learning,
we are supporting career development from when employees

first enter the company until they are executive candidates withan expanding educational program. The university has elective
training and e-learning that teaches about themes chosen freely by
employees in addition to various options and a public offering stylegroup training.
The university also has training rooms combined with a library
space, concentrates on employees and encourages fun in learning.

Concepts of SGH University

Synergy
Student

Student

Innovation

Discovery
SGH University built a library space in addition to four training rooms.

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SG HOLDINGS GROUP CSR Report 2017

Development
Student

BreakthroughStudent

Building an Organization with Individuality and Diversity

Work-life Management
Establishment of a Group Benefit Association
SG Holdings Group established the SGH Family Benefits
Association on February 21, 2017 and started operations on April 1.
The three concepts of this benefits association are to (1)provide “security” throughout life, (2) build an environment for
the health of employees and (3) foster a workplace employees
can enthusiastically work together with colleagues who “enjoy”
life. Furthermore, the services have been categorized into
“benefits,” “information” and “experience/place” for each of (1), (2)and (3) to provide these services in three groups of members.
The association also conducts OB/OG for staff such as retirees
and part-time employees after retirement age, publishes bulletinsand hosts meet-and-greets.
An environment is being built where people want to work

as a company with not only personnel programs, evaluations
and dealings but also high employee satisfaction reinforced bywelfare benefits to further promote support for the lives of ouremployees.

Benefit Association Website
for Group Employees

Health Management for Employees
SG Holdings Group holds Health Management Project
Promotion Meetings twice a year to set goals and evaluate thesuccess of health management of employees. Employees have
health examinations, engage in measures to prevent severe
illnesses for high-risk individuals in particular, work to reduce risk,
receive guidance about specific healthcare options and othermatters to reduce risk through the work of this project. We arealso engaged in initiatives to prevent illnesses, such as lifestylediseases, before they happen by actively expanding activities
to prevent obesity as well as promote non-smoking for healthy
individuals.
In terms of mental health management, everyone insured
by the health insurance society (approx. 47,000 individuals)
have stress checks once a year and anyone can consult withan industry doctor or other medical professionals if they would
like. SG Holdings Group Health Dial 24, which is available to ouremployees and their families, was also established to receive
consults about mental health. Anyone who would like can have aconsultation with a clinical psychologist free of charge.

Poster promoting theGroup health toll-free
telephone numberChildren’s Observation Day
The SG Holdings Group sets and continually runs Children’s
Observation Days and Family Days at business companies withthe goal for family members of employees to obtain a higher
understanding of the company. SG Motors Children’s Observation
Day was held at the Sendai branch with the participation of 20
children in 2016. All of the children put on the same blue uniform
as the auto mechanics to try some hands-on maintenance.
Children who participated in Family Day held at the SG Moving
Tokyo branch had the chance to try harvesting bitter melon grown
as a green curtain together with their work experience.

SG Motors Children's Observation Day

SG Moving Family Day

SG HOLDINGS GROUP CSR Report 201742

Constructing
Supply Chain CSR
Cooperation with Business Partners
Promotion of CSR in the Supply Chain
The SG Holdings Group believes CSR initiatives throughout
our group as well as the entire supply chain are vital in order tocontribute to the growth of a sustainable society. We formulated
the SG Holdings Group Business Partner CSR Guidelines andshare these guidelines with the main business partners of groupcompanies in Japan to foster understanding about our group’s
concepts and corporate approach to CSR with our business
partners.
Sagawa Express is promoting safety assurance andenvironmentally-friendly initiatives jointly with our business
partners. We are working to ensure safety in the entire supply
chain through efforts such as Safety Patrol for Arterial Transport
and Terminal Inspection for Arterial Transport with cooperationfrom arterial transport partner companies in addition to holding
safety seminars for managers of these arterial transport partnercompanies.
In addition, we are advancing initiations with business partners
toward the reduction of the environmental burden such as
the promotion of a modal shift via “Super Rail Cargo” express
railway container cars developed jointly with Japan Freight
Railway Company, the adoption of EcoMark-certified uniforms
from Mizuno Corporation and the active implementation ofenvironmentally-friendly vehicles with the cooperation of
automotive manufacturers.

Terminal Inspection for Arterial Transport conducted jointly

Super Rail Cargo developed jointly

EcoMark-certified uniform

SG Holdings Group Business Partner CSR Guidelines
1. Strict compliance with laws

5. Consideration for the global environment

We will strictly comply with domestic and foreign laws, and carryout fair and impartial business activities based on corporate ethics.

We will take measures to prevent global warming and air pollution,and promote business activities with consideration for the global
environment.

2. Maintenance and improvement of safety
and security
We will consider safety and security to be our highest-priority
issues. We will make every effort to maintain and improve safety
together with our business partners.

3. Consideration for human rights
and work environments
We will respect basic human rights and ensure a safe and sanitary
work environment. We will also strictly comply with any applicableregional laws.

4. Fair trade transactions
We will carry out contact with our business partners with anattitude of sincerity, and provide opportunities for free and faircompetition. We will strive for co-existence and mutual prosperity
with our business partners by building proper relationships of trust.

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SG HOLDINGS GROUP CSR Report 2017

6. Preservation of information security
We will carry out strict management of confidential informationand personal information related to our business activities, andtake steps to prevent acts such as information leakage andmanipulation.

7. Co-existence with regional communities
We will aid in the development of domestic and overseas regional
communities, and strive for co-existence with society together withour business partners.

Building a Responsible
Management Foundation
Building a Foundation for CSR Promotion
Concepts for CSR
We believe that CSR for the SG Holdings Group consists oflooking toward the development of a sustainable society, andof each employee putting the SG Holdings Group corporate
philosophy of “Trust, Create, Challenge” into practice withcooperation from stakeholders.

Sustainable Development

Corporate
Philosophy

Mid-Term
Management Plan

Management
VisionBecoming Asia’s Leading
Comprehensive Logistics Group

Declaration to Earn the Trustand Empathy of Society
The SG Holdings Group aims to be a company
that is beneficial to society, by creating added
value, through fair competition, whilst supporting
the development of economies and societies.

In 1997, we launched the Sagawa Express Eco Project Promotion
Committee in response to The 3rd Session of the Conferenceof the Parties to the United Nations Framework Convention on
Climate Change (COP3). This committee took the promotion ofenvironmental initiatives to the next level, and it was the originalform of today’s CSR Committee built through a management teamas a way to fulfill the social responsibility of a logistics business
operator.
Presently, the CSR Committee is held each quarter to deliberate
the execution of important CSR measures, build a management
system, and promote continual improvement activities.
We have also created a CSR Book gathering together the SG
Holdings Group CSR concepts for fiscal 2016 in a visual and easyto-understand format. This booklet plays a role such as in employee
education.

Material CSR Issues

Shareholders

Business
Partners

Corporate Charterof Business Conduct(Ethical Code of Conduct)
Practical implementationby each employee
Cooperation

Employees

Society

Customers

Cooperation

Overview of CSR Committee¢Members ..............................................................................................................................
• Committee Chairperson: SG Holdings Co., Ltd.
Eiichi Kuriwada, Chairperson and CEO• Committee Members: SG Holdings Co., Ltd.
5 Directors and 2 Executive Officers¢Record of meetings held in fiscal 2016 .....................................
• Four meetings within the fiscal year
(April 2016, July 2016,October 2016, March 2017)¢Major discussion topics in fiscal 2016 ........................................
• Report of items pertaining to CSR management• Progress report of CSR-related activities

Stakeholder Dialogue
We sincerely accept the opinions from external experts throughthis dialogue as well as the claims of our customers and consider
as well as execute measures to respond to this feedback in order toreflect the voice of our wide-ranging stakeholders in our businessas part of CSR activities at the SG Holdings Group. In particular,
this dialogue has been conducted since fiscal 2004 as a venue toexchange ideas with our stakeholders who have a broad rangeof viewpoints about the requirements of the society and issues
believed important by our group.

SG HOLDINGS GROUP CSR Report 201744

Corporate Governance
SG Holdings strives to streamline management systems of thegroup and practice speed management as a holding company.
The Board of Directors made up of seven directors (one of whom is
an external director) is charged with the management of the entire
Group as well as the auditing functions of business execution. The
auditing functions of management and businesses execution are
divided by introducing an executive officer system to clarify theauthority and responsibilities.
Moreover, the Board of Auditors made up of four auditors (threeof whom are external auditors) was established to supervise andaudit management.
(The number of directors and auditors is current as of April 2017)
Internal control is stipulated by the “Basic Internal Control Policy”
as guidelines. The necessary improvement measures have been put
in place by effectively conducting internal control and evaluating
its effectiveness.
We continually conduct reviews to respond to changes such as
those of the management environment and strive to establish evenmore effective internal control.

Corporate Governance System
Stakeholders (Clients, Business Partners, Local Community, Shareholders, Employees)
Shareholder Meetings
Reports, Discussions

Election, Dismissal

Reports

SG Holdings GroupSG Holdings Co., Ltd.

Board of Auditors

Board of Directors

Cooperation

Auditing, etc.
Supervision

Business Affairs

Cooperation

Assignment

Representative Director
Approval

Reports

Reports

Management and Administration
Enhancement Committee
Investment Review Committee
Budget Committee

Internal Auditing Department
AuditsReports

Financial Auditor

Legal Advisors

Election,
Dismissal

Election, Dismissal

Cooperation
AuditsManagement Strategies Meetings
Policy, Planning, Deliberation,
Assignment, Approval, Supervision, etc.

Risk Management Meetings
Administration Department
Directors' Meetings

Department

CSR Committee

Management Guidance/
Approval, Assignment of Important Issues
Agenda, Reports/Prior Consultation

Group Companies

Compliance
Strengthening the Compliance System
To deal with changing social and management environments,
and to build a corporate culture that performs business activities withintegrity, SG Holdings Group is working to improve the maintenance andmanagement of our compliance system, which abides by the SG HoldingsGroup Code of Ethics and Conduct.
As one part of this, the SG Holdings Group Compliance Hotline is being
operated based on the internal notification system, as a contact window
for employees, their families, and partner companies to report behavior
in violation of laws, company rules, or the Code of Ethics and Conduct. A
new external contact window was also put in place in fiscal 2017.
Moreover, in consideration for increasing opportunities such astransitions of overseas listed companies to Group companies or thecreation of business alliances and capital alliances with listed companies,

45

SG HOLDINGS GROUP CSR Report 2017

efforts are being made to prevent insider trading by enacting new insider
trading prevention regulations and implementing education by seminars.
We will strengthen compliance initiatives in the future as a pillar
supporting internal compliance throughout the entire group.

Poster raising awareness about
internal notification systems

Building a Responsible Management Foundation

Protection of Intellectual Property
SG Holdings Group protects the intellectual property rights of
our Group to maintain the health of our business activities, manage
our intellectual property rights, and spread knowledge andawareness so that the intellectual property rights of other parties
are not infringed upon.
Our initiatives for protecting the intellectual property of theGroup include acquiring rights for the intellectual property of eachcompany in the Group, and maintaining control of our intellectual
property rights. We regularly confirm the intellectual property rights

of other parties to avoid intellectual property right infringement,
and share this information with relevant divisions and send out
awareness messages.
We also spread knowledge and awareness of these activities
throughout the entire Group. The SG Holdings Code of Ethics andConduct includes a basic intellectual property policy as one part of"Management of Corporate Property and Information.”

Cutting Relationships with Antisocial Forces
SG Holdings Group has defined the “Antisocial Forces Exclusion
Regulations” for the purpose of excluding antisocial forces thatjeopardize the order and safety of society to sever any and all
relationships with antisocial forces, such as consenting to unfair
demands, engaging in backroom dealings or financing. Moreover,these regulations even regulate the Corporate Charter of BusinessConduct as well as the Ethical Code of Conduct in addition toclarifying the Basic Internal Control Policy to raise the utmost
awareness in our employees.

In regards to the specific activities, we conduct attribute surveys
such as dealings (payment/invoicing) and we have established theConsultation Window for Undue Requests for early-stage resolutionof cases where employees receive inappropriate requests.
We will continue to develop the system, and thoroughly preventor block those who would interfere with our business partners andothers by measures such as sharing information on antisocial forces
and our responses to them.

Risk Management
Risk Management System Enhancement
The SG Holdings Group is proceeding with the enhancement ofrisk management systems to understand, evaluate, and manage
risks in the business operations of its Group companies. At Risk
Management Meetings, systems are arranged to investigate andreport risks in group companies.
Our group companies thoroughly carry out risk management
based on the risk management flow. This unified risk management
is carried out across the entire group toward risks identified by eachcompany, and includes analyzing their trends and putting risks into
visual form by creating risk maps.

In addition, we began investigating the construction of arisk management system for global sites and selected a model
location in fiscal 2016. In the future, we will work to implement
and strengthen management systems even more by formulatinga specific road map while cooperating with SG Holdings Global,
which is the company in charge of overseas operations, andoverseas sites.

Risk Management System
SGH Group RM Meeting

Director in Charge of Management

Division with Jurisdiction over SGH Important Risks

RM Manager

Group RM Supervision Manager

SGH: SG Holdings
RM: Risk Management

RM Manager
Division with Jurisdiction over General Affairs(Executive Office)Head of Division with Jurisdiction over General Affairs

RM Supervision Manager

RM Manager
RM Manager

RM Manager

RM Manager

RM Manager

RM Manager

RM Manager

RM Manager

RM Manager

Individual RM Meetings

RM Manager

RM Manager

RM Manager

Individual RM Meetings

RM Manager

Division with Jurisdiction over Important Risks

RM Manager

Division with Jurisdiction over Important Risks

RM Manager

Division with Jurisdiction over Important Risks

RM Manager

RM Supervision Manager

RM Manager

RM Supervision Manager

RM Manager

RM Supervision Manager

Individual RM Meetings

SG HOLDINGS GROUP CSR Report 201746

Crisis Management
BCM Initiatives
Formulating BCP for Each Group Company

Group BCM Links

The SG Holdings Group aims to further crisis management and it
is working to strengthen crisis management systems, including theformulation of Group BCP*₁ to link to BCM*₂.
The formulation of BCP is progressing in stages, and its
formulation has been completed at all business companies inJapan.

SG Holdings Group is strengthening Group crisis management
systems through ongoing debate about business continuity
management by periodically holding BCM coordination meetings.
We are also utilizing emergency information systems as areporting tool in order to share accurate information quickly andrespond as a group when a crisis such as a disaster strikes.
In addition, Sagawa Express has entered into comprehensive
partnership agreements with 12 cities and prefectures in addition
to disaster agreements with 44 cities, prefectures and associations
so that we can establish links not only within the group but also
externally. (As of April 2017)
We are also holding meet-and-greets with external organizations
involved with business continuity and participate in joint projects
with outside associations.

*1 BCP (Business Continuity Plan): This plan not only minimizes the damage to businesses inan emergency situation such as a natural disaster or terrorist attack but also puts in places
mechanisms and steps in advance for business continuity so that business can be recovered assoon as possible.
*2 BCM (Business Continuity Management): This management method that ensures formulated BCP
functions properly.

These initiatives were able to resume
our businesses such as the receipt ofrelief supplies at local transport sales
offices four days after the Kumamoto
Earthquake struck in 2016.
This picture shows activities at
Mashiki Town Hall.

SGH
Group Oversight Headquarters
SGS
SystemSGL・SGLP
Overall SRC/3PL
Logistics

Each Group Company
SGM
Vehicle Maintenance

Relay center

SGE
Management
Operations

Relay center

SGMV
Installation Operations/Charter Flights

Sales Office

Recipient

SGR
Repair of Buildings/
Equipment

Sender

Sales
OfficeSGW
Overall Delivery Services

Company
Gas Station
SGA
Fuel Supply

SGFD
Access to Human
Resources

Sales Office

SGF
Payment

Implementation of Business Continuity Training
We are conducting periodic business continuity training with theparticipation of management and persons in charge of BCM from SG
Holdings and each business company in Japan to evaluate whether
the BCP that has been formulated appropriately functions as part ofthe BCM.
In fiscal 2016, we conducted highly practical private training aroundthe theme of “cooperation” between group companies.
123 people, including presidents of Group companies, and 53
people from outside of the company such as relevant government
offices, municipalities, suppliers and partner companies participated as
observers.
Business Continuity Training

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SG HOLDINGS GROUP CSR Report 2017

Recipient

Each business company
utilizes each other’s
resources and SG
Holdings gathers andshares information
because Sagawa
Express logistics cannot
stop as a core businesscompany.

Building a Responsible Management Foundation

Information Security
Basic Information Security Policies

Raising Awareness About Information Security

The SG Holdings Group considers the protection of our Group’s
information assets, including information assets received from
customers, to be our social responsibility. We have therefore
formulated Basic Information Security Policies and are involved ininitiatives to maintain and manage information security.
We are also taking further steps to strengthen information
security by enhancing measures for information security
resources and arranging information security regulations andprocedures.

Each group company conducts ongoing awareness raisingand education by reading through the SG Holdings Security
Handbook as well as conducting comprehension tests with thegoal of improving awareness about information security in all of
our employees.
Furthermore, targeted e-mail attack response training was also
held as necessary, and follow-up education was carried out via
e-learning for employees who opened an attachment or clickedon a link.

Implementing Security Assessments

Obtaining ISO27001

The current conditions of internal and external environments
must be understood, and the cyber-security management system
must be evaluated to prevent serious security incidents before
they occur. Moreover, we extract issues to reach an ideal form,
define measures and assign the priority of these challenges after
benchmarking other companies and setting ideal security levels.
SG Systems is implementing such security assessments whileconsidering the entire group that is expanding internationally,
and it is formulating road maps so that even more effective
security measures can be reliably executed.

We are obtaining the ISO27001 international standards
certification, which is an information security management
system, at the business companies below to respond to customer
needs and improve accessibility through services guaranteeing
high-level information security.
• Sagawa Express (Sales Department, Sales Section)• Sagawa Global Logistics (Head Sales Department, Sales
Development Department, Logistics Solutions Department,
Hokuriku Branch Kanazawa SRC, Kitakanto Branch, Kita-Tokyo
Sales Office, Tokyo Branch Oi SRC)
• SG Systems (Head Office, Kyoto SI Center, Fukushima BPS
Center)

New Establishment of SG Holdings Group “CSIRT”
In recent years, enhanced management
systems are more necessary than everbefore as dangers of a wide range of cyberattacks from outside the company grow.
Therefore, in addition to conventional
management systems, SG Holdings Grouphas built SGH-CSIRT(*) with the goal ofearly recovery by minimizing damage as
much as possible in the event of a cybersecurity incident.
The group has also become a memberof the Nippon CSIRT Association andshares the response track-record of SGHCSIRT with that association. By deepening
mutual links, the SGH Group promotes aneven greater security level and contributes
to improving the security level of society
at large.
*CSIRT: Acronym for Computer Security Incident Response
Team. This is a specialized team that handles information
security problems.

Inside of the SG Holdings GroupManagement

Security
Incident
OccursReports

ReportInvestigation Agencies
Competent Authorities

SGH-CSIRT

Malicious
User

AttackSystemCooperation

ConveneIndustry companies
Member Associations

Customers
Contact

Department

Department

Department

SGH-CSIRT
SG Holdings
SG Systems(Incident Response)

Each SGH Group Company
Cooperation

Use incident reports as an opportunity
to launch virtual organizations

SG HOLDINGS GROUP CSR Report 201748

Building a Responsible Management Foundation

COLUMN

Most Outstanding Resilience Award (2017)
The government is advancing
initiatives all across Japan in industry,
academia, government, and the private
sector to realize the “Fundamental Plan
for National Resilience.” On this occasion,
Sagawa Express has been awarded
the Most “Outstanding Resilience Award” in the corporate
and industrial category of the “Japan Resilience Award 2017”
created by the Association for Resilience Japan.
This award evaluates and commemorates companies
and associations who engage in activities to aid in strong
yet flexible national development, regional development,
human development, industrial development, technologicaldevelopment and product development to build a society forthe next generation.
The reasons our company received this award is forfurthering the diversification of fuel used from energysecurity perspectives while encouraging the adoption of nextgeneration vehicles (natural gas, hybrid, post new long-term
regulation, EV and other vehicles) as resilience measures forvehicles and fuel in logistics infrastructure. Our measures put inplace for business continuity such as the introduction of fuel oil
pumps (foot-pedal type) able to supply fuel even during power
outages were also considered together with the company gas
stands (129 light-oil intake stands and 22 natural gas stands)
established throughout Japan to ensure a stable supply offuel and sustain a supply system. We were also praised for our
promotion of Business Continuity (BC) links with companies invarious other industries such as infrastructure.

Endowment Classes for University Students (2016)
Endowment classes were held at Kansai University aroundthe theme of risk management of business companies
that support safe and secure logistics platforms. We raised
awareness in students from multiple perspectives by giving aplatform to a series of experts from in our group to transport, IT
systems and the airline industry. These classes have been held
15 times on individual themes such as the BCP/BCM of logistics
companies.

Main Themes
 BCP/BCM of logistics companies
 Safety and human error at logistics companies
 Logistics and information systems
 Large-scale disaster training for SCM
 Logistics and weather: Logistic BCM during disasters
 Expressways and disasters: Logistic BCM during disasters
 Risk management for air transport businesses

49

SG HOLDINGS GROUP CSR Report 2017

Expert Opinion<Praise>the start of activities to appoint managers in charge of quality at
all Sagawa Express sales offices and activities for re-certification

I believe this is an excellent report that clearly reflects the
management philosophy of the SG Holdings Group aroundthe keywords of “Trust, Create, Challenge” overall. SG HoldingsGroup is approaching its 60th anniversary since its founding thisyear. The environment differs in each generation and region.
However, by reflecting the challenges and expectations ofsociety in “business,” a consistent Group stance can be taken tocontribute to the expansion of a sustainable society. The CSR

to the ISO9001:2015 standards as well as holding of Quality
Championships setup by SG Moving where employees competewith their knowledge and skill (p.22). The production and salesof “services” such as logistics tends toward larger fluctuation inquality than the production and sales of “things” because people
act as an intermediate. I hope the group will continue these
activities in the future for the safety and security of customers aswell as for greater growth of the group itself.

activities incorporated in the group's primary businesses can besaid to indicate the high sense of social responsibility held by the
SG Holdings Group. In this way, I think the sincere approach to
CSR is highly commendable.
Feature 1 (p.8-10) paints a picture about the establishmentof SG Sagawa Vietnam as a wholly-owned subsidiary in 2015 in
Vietnam, which has been identified as a global strategic site. The
article also introduces Sagawa Express Vietnam establishment
in 1997 and the contributions in improving the productivityof senders operating 3PL businesses. Furthermore, this reportoutlines the construction of an environment where employees in
the group and at outsourcing companies are able to comply tothe law and work enthusiastically based on the local workplacein Vietnam.
The part of this report I would like to give the most praise is
the amazing evolution of the SG Holdings Group over this year
in “Building an Organization with Individuality and Diversity(p.37-42).” The formulation and release of the “SG HoldingsGroup Human Rights Policy” that commits to the principles
of respecting the human rights of every stakeholder has anextremely broad meaning in dealings conducted with entities
overseas. As described in the Top Message, the group makes
considerations in human rights, the environment, and safety as<Critique>
Today, the SG Holdings Group is building systems to promote
CSR at seven companies in Japan. However, I hope these efforts
will expand to other business companies in the group in the next
fiscal year. Multiple business and CSR activities of overseas groupcompanies were also introduced in this report. When considering
efforts in expanding to “become Asia’s leading comprehensive
logistics group” outlined in the medium-term management
vision of the SG Holdings Group, I expect systems to be built inwhich local overseas companies in each country can promote
CSR management autonomously in the future.
Another aspect is related to the disclosure of data. SG
Holdings Group has worked passionately to preserve andimprove the global environment as a leading company inthe logistics industry up until now, such as the purchases ofmultiple natural gas trucks and the acquisition of the first Carbon
Neutral Certification in the logistics industry. Presently, because
statistics about energy and CO emissions are limited to Japanin this report, I think it would be wise to consider collecting anddisclosing statistics about environmental data such as water andwaste for the entire group, including group companies overseas.

well as the pursuit to manage environmental and social risks
throughout the entire supply chain as prerequisites to businessdealings with global companies. Even in Japan, the Group
opened SGH Kids Garden, which supports employees return
to work, as well as the SGH University, which is an in-house
university. I am not hesitant when I say systems are rapidly being
put in place where people can work in the long-term in anenvironment fair and equal for stakeholders. I want to give highmarks to this series of initiatives.
Additionally, I think focus should be on points where thegroup is establishing systems for quality management such as

Mika Takaoka
Professor, Business Administration,
Rikkyo University

SG HOLDINGS GROUP CSR Report 201750