From Good Morning to Good Night
More Dreams for Your LifeCSR Report

2009Top Message

Our CSR Starts with Lion’sFounding Spirit

Sadayoshi Fujishige
President and Chief Executive Officer

Lion’s Corporate Social Responsibility(CSR)
Since its foundation in 1891, Lion Corporation has strived tocontribute to society by serving needs related to personal
health and clean, comfortable living.
Throughout the 118 years of our history up to the present,
we have maintained our founder’s philosophy of contributing
to society through our business, maintaining honesty as thebest business strategy, and viewing our employees as partners
who work together to develop the Company. This philosophy
provides the foundation for CSR activities that encompass
environmental protection and social contribution efforts
as well as our business, which has evolved around the key
focus areas of health, comfort and the environment. Because
this essential concept of CSR comes naturally for Lion, eachand every employee engages in CSR activities as an intrinsic
component of our business.

Looking Back at 2008
In 2008, the Toyako Summit was held in Hokkaido, immediately
followed by the Japanese government’s cabinet-level approvalof the Action Plan for Achieving a Low-carbon Society. This
year, the government, industries and the general public shared
a common perception of the need to take action toward thedevelopment of a low-carbon, recycling-oriented society.
On another front, the deteriorating global economic climate
triggered by the financial crisis in the United States forced
us to also reexamine corporate social responsibility from theperspectives of business operations and employment. Under
these circumstances, Lion guided its business and social
contribution activities to support the sustainable developmentof society as a responsible corporate citizen while at the sametime meeting the needs of those who desire to live healthy
and comfortable lives, endeavor to be environmentally friendly
and do something on their own for the environment.

1

1. Enriching everyday life
—Demonstrating leadership in a culture of healthy,
comfortable lifestyles
The mission of Lion is to enhance the happiness andlifestyles of each and every customer. Since its founding,
the Company has encouraged the development of healthy
behavior including good dental habits as well as the regularwashing of dishes and vegetables. In recent years, Lion has
also demonstrated its commitment to helping establish good
hand-washing and gargling habits. We are proud of our rolein the development of a clean and sanitary culture in Japanthrough these activities.
In 2008 as well, we focused on delivering products that
instill comfort and new habits into everyday life, and such new
products as Kaoritsuzuku TOP and BATHTOLOGY have beenwell-received.
Looking ahead, Lion intends to play a part in extending
healthy life expectancy (lifelong health and independent
living) and help people enrich their everyday existence with anenhanced quality of life.

2. From everyday living to a low-carbon andrecycling-oriented society—Becoming a leading company in environmental
friendlinessWe are advancing environmental activities in three priority
areas.
The first area is the shif t to plant-based materials.
Throughout the 36 years since 1972, Lion has been replacing
petroleum-based materials with plant-based materials. The
ratio of plant-based materials in Company products is now
over 50%. We also established a new company in Malaysia,
Lion Eco Chemicals, to encourage the widespread use of MES(methyl ester sulfonate), a plant-based surfactant that does
not increase Lion’s CO2 emissions. The Company will start fullscale commercial production in 2009. In the procurement ofpalm oil as a major plant-based material, Lion is a member of
an international roundtable for sustainable palm oil supply toensure environmentally and socially responsible procurement.
The second area is preserving aquatic environments. Water
is an indispensable component of Lion’s business, which has
been providing a variety of washing-related products since
its foundation. So it was natural for Lion to establish the LionAward at the Japan Society on Water Environment in 2008
to support scientific and technological research by honoring
young scientists. The Company also launched the LION TOP
Eco Project, which invites customers to participate in activities
to preserve aquatic environments. In this project, a portionof the proceeds from the sale of TOP laundry detergent
is donated to the Foundation for Living with Clean Rivers
operated by the Japan River Association to provide monetary
support for activities that protect rivers, lakes and other aquatic
environments.
The third area is Lion Eco Standards-based productdevelopment. We set product development standards thatincorporate environmental considerations and focus on thedevelopment and launch of eco-conscious products.
In recognition of these efforts, Lion was selected in March
2008 and then again in 2009 for FTSE4Good Indices, one of thebest-known global indices for socially responsible investment.
Lion was also recognized as the first Eco First Company in the
manufacturing industry by the Ministry of the Environment inJune 2008. This certification is awarded to companies leadingin environmentally sound operations.

3. A company in which employees can work every
day with pride and energy—Building a dynamic corporate culture
Lion Corporation has long maintained a corporate culturethat values tenacity and creativity and boldly offers younger
workers key tasks. I believe that at its core, this culture
embodies respect for people and discipline in business. People
feel immensely empowered to tackle challenging tasks when

they feel understood by those around them. We must nurture
employees from a long-term perspective. Awareness of this
support builds confidence and boosts motivation. We at Lion
Corporation are committed to establishing and improving
systems that free employees from concern about their futuresand offer a variety of options for living and working. We view
these initiatives as an investment for the Company’s future.
We have also established a fund through which Company
management encourages young employees to plan anddevelop new businesses without fear of taking risks. Lion
Corporation strives to be a company that instills pride in
every employee and is recognized by employee families as an
excellent place to work.

CSR in the Future
To support lifestyles that are filled with happiness, all of us at
Lion focus our actions on delivering customer satisfaction as
the root principle of our business. Since April 2008, the firstthing a director, auditor or operating officer sees on theirmonitor when they turn on their computers is the VOC (Voiceof the Customer) daily bulletin. This provides particularly key
inquiries and opinions about new products selected fromcomments received by the Consumer Service Office. We
believe that paying attention at all times to external trends,
including customer comments, is an important means formaintaining the Company’s awareness of social values. We
always keep the Company’s founding spirit in mind while atthe same time recognizing the needs of the times throughdialogues with our stakeholders so that we can quickly
advance our CSR-driven management across a wide rangeof fields, such as environmental considerations, the creationof safe workplaces and protection of human rights, creationof employment and the establishment of beneficial andappropriate relationships with business partners as well as
product quality assurance.

2

Introducing Eco-friendly Detergent

Special“MES” to the World
Topic 1 Material
Operations Underway at Lion Eco Chemicals Plant

Production of Eco-friendly Detergent
Material Begins

At an ideally situated location

MES (methyl ester sulfonate) is a surfactant used in laundry
detergents such as Lion’s TOP. This washing component is ecofriendly, as it easily biodegrades in the natural environment
after use and does not increase the volume of CO 2 in theatmosphere since it is a plant derivative with a higher
detergency than the conventional surfactant LAS*1. Lion
Eco Chemicals Sdn. Bhd. completed its Malaysian plant for
producing MES and began production this year. With an
oleochemical business that is the most developed in theworld, Malaysia is able to provide a stable supply of palm-oilderived methyl ester and produces 18 million tons of palm
oil annually. The plant, situated just ten kilometers north ofSingapore, is ideally situated in a strategic location for marinetransportation and for highly efficient product exporting.

Accelerating the Dissemination of
MES
At a locally-established R&D division

The most beneficial characteristic of MES produced in our
Malaysian plant is its granularity, which facilitates blending
into detergent while achieving high quality. The plant has
adopted a completely new production process by combining
innovative technologies and the experience built up since1991 at our domestic plants. We have set up a local R&D
division and provide information on the characteristics anduse of MES. The division has established a system for fully
supporting formulation development tailored to the specificwashing conditions and user needs in different parts of
the world. This is feasible by taking advantage of the MES
blending techniques the Company has created over about
20 years of product use. And we believe it will accelerate
the dissemination of MES while earning consumer trust. We*1 See p. 35 for more details on environmental considerations associated with MES.

3

have also finished preparations for supplying the European
market by completing preliminary registry with Registration,
Evaluation, Authorisation and Restriction of Chemicals (REACH),
which came into force in 2008 in Europe.

Reduced the Environmental Impact
Associated with our Plant
Using natural resources
Serious consideration is given to plant eco-friendliness inview of its own operations. One feature of the plant is its
photovoltaic power systems, which cover the entire roofs of its
office and process control buildings and enable the utilizationof solar energy. Annual output is about 60 MWh, roughly
equivalent to the annual electrical power consumed by 20
average families of four. Another eco-friendly feature is theuse of rainwater for cooling. We installed rainwater collection
tanks with a total capacity of 500 tons and plan to save about
9.8 thousand tons of tap water every year. Furthermore, waste
water is treated before discharge in facilities that utilize thelatest technology.
We will not only supply MES to Asian countries but to Europe
and the U.S. as a way to protect the global environment.

Detergent performance evaluation at Lion Eco Chemicals

Malaysia

Lion Eco Chemicals
Singapore

Mitsuharu Kachi

Panoramic view of Lion Eco Chemicals

Executive Officer, Senior Executive
General Manager of International
Division and Representative Director ofLion Eco Chemicals Sdn. Bhd.

Aiming to Achieve Sustainable Procurement of Palm Oil
Toward Securing a Sustainable Supply

Resolving Issues Related to Procurement of Palm Oil

Lion has been a member of the Roundtable on Sustainable Palm
Oil (RSPO) since 2006. In addition, since as early as the 1980s, Lionhas been providing technical cooperation related to the refinement
and effective utilization of palm oil to the national Palm Oil ResearchInstitute of Malaysia (current Malaysia Palm Oil Board: MPOB). In
2007, RSPO adopted “the principles and criteria for sustainablepalm oil production (plantation management criteria).” Based onthese, certification audits of plantations and distribution of RSPOcertified sustainable palm oil began in 2008. Case studies ofvarious certification systems were introduced at the 6th Annual
Roundtable of the RSPO held in November 2008. In anticipation of
full-scale operations under RSPO certification, Lion implemented an
independent audit of supplier plantations in May 2007.
In response to the possible future depletion of such finite natural
resources as petroleum, renewable resources through the cultivationof plants are being made available. These viable alternatives to fossilbased natural resources are effective in the fight against global
warming owing to their carbon-neutral effect. Palm oil is a resourcethat Lion will continue to use into the future because of its superior
level of yield.

The production of palm oil exceeds that of all other fats and oils
in the world. Approximately 80% of palm oil is used as cooking oil,margarine and shortening, with the remainder used as industrial
raw materials. As the world’s population continues to increase, theglobal food supply is projected to become even more strained in
the near future. To meet the increased demand from China andIndia, in particular, the level of production of palm oil, which has ahigh rate of yield, is projected to continue rising in the coming years.
Various environmental and social problems, however, such as theclearing of tropical rain forests and the shrinking of wildlife habitats
stemming from the development of new plantations, as well as
poor working conditions, are becoming increasingly evident. In
light of such conditions at these areas of production, Lion is working
to maintain responsible procurement of palm oil through actions
that promote adequate management among suppliers—following
the RSPO’s criteria for plantation management—as well as throughactivities undertaken by the RSPO.

RSPO (Roundtable on
Sustainable Palm Oil)

Principles and Criteria for
Sustainable Palm Oil Production

A council established by the WWF(World Wide Fund for Nature)and palm oil-related enterprises
for sustainable production
and procurement of palm oil.
Membership includes over 300 palmoil-related organizations worldwide
including plantations, process
manufacturers, consumption-goods
producers, retailers, banks and NGOs.
RSPO website: http://www.rspo.org/

These basic principles were
established to make sustainable palm
oil production a reality alongside theprevention of rampant plantation
development and the protectionof workers. The 8 principles and39 criteria include: Environmental
responsibility and conservation ofnatural resources and biodiversity,
Responsible consideration of
employees and of individuals andcommunities affected by growers andmills, and Responsible development of
new plantations.

6th Roundtable on Sustainable Palm Oil

Visiting plantations

4

Lion’s Efforts to Preserve

SpecialTopic 2 Aquatic Environments
Support for the Japan Water
Award
Since 2006, Lion has been supporting the Japan
Water Award, an authoritative honor that recognizes
outstanding activities to preserve Earth’s water
resources. The 10th Award (2008) was presented to
Kumamoto City for broadening preservation activities
to integrate water circulation systems with thehometown cultural aspects of water.

Supporting Civil
Activities
Japan Water Award ceremony (June 12, 2008)

Support for the Japan
Stockholm Junior Water Prize

Saving the Earth, Our
Beautiful Planet of Water
Supporting
Youth Research
Activities

Fresh water comprises only 2.5% of all water on
Earth. Excluding water locked in glaciers andgroundwater, only 0.01% of all water is available
for human use. We must therefore use it wisely if
we are to create a sustainable recycling society.

Japanese representative presenting at theinternational convention (August 19, 2008)

Since 2006, Lion has been supporting the Japan Stockholm Junior Water Prize,
which recognizes outstanding research activities related to water environment
soundness and conducted by students under the age of 20. In 2008, the award
was presented to a team from Hiroshima Prefectural Hiroshima Kokutaiji HighSchool for a heredity study and preservation of Japanese giant salamanders(Andrias japonicus). The study was jointly conducted with American andChinese high schools. The team attended an international convention inautumn held in Sweden.

Establishing the Lion Award at theJapan Society on Water Environment

Supporting
Young
Researchers

43rd Annual Meeting(March 17, 2009)

In 2008, Lion established the Student Best Poster Award(commonly called the “Lion Award”) at the Japan Society on
Water Environment, the largest academic society in Japanfor the preservation of water environments. The award
is presented for outstanding research efforts conductedby undergraduates, technical college students and juniorcollege students. The first Lion Award was presented at the43rd annual meeting on March 17, 2009. The award recipientcommented, “This valuable experience has inspired me to
do even more.” Lion will continue its efforts to boost the
motivation of young researchers.

5

Support for Rainwater
Network Japan

Supporting
Activities to
Encourage
the Use of
Rainwater

Massive floods and great droughts occur frequently on a global scale,disrupting the water cycle. Lion supports the Rainwater Network
Japan, through which citizens, government agencies, enterprises andresearchers exchange information about rainwater use as a solution
for creating a water-recycling society.

Lion Forest in Yamanashi

Forest
Maintenanceby Employees
in Cooperation
with Local
Communities

Forests have the capacity to retain rainwater and thereby has the ability to produce cleanwater. Lion has been supporting the maintenance of the Lion Forest in Yamanashi City. The
Company also encourages employees to volunteer for forest maintenance activities, such astree planting, removing underbrush and thinning to nurture their environmental awareness.
These activities also promote interaction with local residents. Thinned wood from the Lion
Forest in Yamanashi is used for paper in such documents as CSR reports.

Number of sessions
Total number ofparticipants from Lion

2006
1

2007
2

2008
3

25

42

76

As a Company in theBusiness of WashingThinning work (April 17, 2009)

Lion has evolved its business with a deep
involvement in the process of washing, always
in a close relationship with water.
The Company has been continually introducing
into the marketplace water-environmentfriendly products, including phosphate-freedetergents in the 1970s (see p. 34 for details).
We will continue moving ahead withapproaches to preserve water environments.
Planting trees with local primary school children (April 16, 2009)

LION TOP Eco Project

Supporting Civic
Activities with
Customers

Lion provides monetary support for activities that protect rivers, lakes and other water
environments undertaken in many parts of the nation by donating a portion of proceeds fromthe sale of TOP laundry detergent to the Japan Clean Water Foundation, which is operated
by the Japan River Association. In 2008, the Company donated ¥12,186,257, a portion ofits sales from April 1 through June 30, to the Japan Clean Water Foundation. A total of 23
organizations were subsequently selected to receive support after an impartial examination by
the foundation’s panel, which ensures the money will be used for notable activities to protect
water environments around the nation. In addition, Lion held the Waterfront Painting Contest,
designed to encourage children to consider rivers and lakes as a part of our immediate
natural environment. A total of 3,568 paintings were submitted to the contest, and 21 children
received awards.

Rainwater Network Japan (August 6, 2008)

Contest award ceremony (August 9, 2008)

6

CSR and Lion

Lion’s Dialogue with Stakeholders Forms
the Foundation for its CSR Activities
The fundamental approach to Lion’s CSR is fulfilling social responsibilities through our corporate activities.
To respond to social expectations, Lion is further deepening its communications with stakeholders.

Lion’s Approach to CSR
Guided by its corporate motto and management philosophy,
Lion has worked diligently since its foundation in every facet ofits business activities to become a trusted member of society.
The concept behind CSR—corporate social responsibility—
comes naturally for Lion Corporation. Nevertheless, theCompany constantly reviews its CSR activities in light ofevolving social expectations.
In 2003, we announced our Compliance Declaration andformulated the Lion-Group Charter for Corporate Behavior.
Built on ten principles, this Charter enables us to maintain apositive influence on society. In 2005, Lion established the
CSR Promotion Department for general management of CSR
activities across the Company. In its VIP II 09 medium-term
management plan, Lion positions proactive CSR activities as
an essential factor for increasing corporate value.
We revised the Lion-Group Charter for Corporate Behavior
and the Behavior Guidelines*1 in 2008 to reflect changes insociety. Drawing upon these sources, we established our CSRoriented Procurement Principles to clearly state what suppliersmust consider in the areas of environmental protection,
human rights and labor. We also convened the first formal
stakeholder dialogue after a pilot gathering. Looking ahead,
we will continue to pursue CSR activities by further deepening
our dialogues with stakeholders.

■ Lion’s CSR Activities

The Company promotes CSR activities in accordance with
its company motto, management philosophy and Charterfor Corporate Behavior.
We establish effective systems for corporate governanceand compliance in the framework of these basic concepts.
This is done while implementing corporate activities in
response to changes in society by communicating with our
major stakeholders toward creating a sustainable society.

Sustainable development of enterprises/society

Stakeholders
Customers

Communication withstakeholders

Corporate activities in
response to changes in society

Information disclosure
Dialogue

Development of corporate
governance and compliance systems

Employees
Shareholders/Investors
Business partners
Local communities

Cooperation

Convening Stakeholder Dialogues
On November 11, 2008, Lion held its first Stakeholder Dialogue after inviting four outside experts to exchange opinions for the
purpose of more closely aligning business activities with changes in society.
The discussion in this first dialogue sought to avoid a narrow focus by encompassing a broad range of topics to deepen
mutual understanding around the theme, “Communication through CSR reports—Is the Company’s intention being
conveyed?” Comments were used to guide a review of the composition and description of CSR Report 2009. Starting in 2009,
we will deepen the dialogues by focusing on individual topics in order to identify issues and improve corporate activities
through reflecting in them the dialogue results. The initial dialogue served as the first step in this direction.
■ Participants
Outside experts:

Tamae Kobayashi, Visiting Researcher, Environmental Affairs, Communication Science Institute Inc.
Yoshiki Midorikawa, Co-Chairperson, The Valdez Society, and Director of Green Consumer Research Group
Satoshi Yura, Senior Fellow and SRI Program Director, the Center for Public Resources Development
Minako Oishi, Deputy Chair of the Environment Committee, Nippon Association of Consumer Specialists

Lion Corporation: Tetsuo Yamada, Senior Executive Director and Representative Director;

Yasutsugu Kawabata, Director of Personnel Department; Takamasa Fujii, Director of Investor Relations Office;Yoshiyuki Aida, Director of Public Relations Department; Kazuo Nago, Director of CSR Promotion Department

Facilitator: Kazunori Kobayashi, Manager, Japan for Sustainability■ Key comments• Although the report as a whole includes a sufficient volume of information, it is not easy to identify the essential concepts that undergird individual
activities as well as their meaning and interrelationships.
• Include self-evaluation of your responses to inquiries on product problems.
• The report does not portray the big picture of company employees, including the rate of part-time and fractional employment.
• Disclosure of information about CO2 excels.
• The ongoing pursuit of sustainable palm oil procurement is worthy of merit; the report is to be especially commended for discussing this issue in detail.
• The report does not clearly make connections between individual activities for preserving aquatic environments or for ensuring their continuity.

*1 Behavior Guidelines

7

HP http://www.lion.co.jp/en/company/html/com0201f.htm

CSR and Lion

■ Lion’s 2008 CSR Status and Issues for the Future

Item

Status of major activities

Issues for the future• Partially revised the executive compensation system basedon the Compensation Advisory Committee report

Governance andinternal control• Completed assessment of internal controls regarding thefinancial results report and the prior evaluation of the audit
system• Revised the internal control system• Appropriate operation of the evaluation/
audit system of internal control

Compliance• Promoted and established the Heart Hotline• Implemented an e-learning program on information leakage• Announced the Charter for Corporate Behavior and ensured it
was understood by all Company employees• Encourage business partners to use theHeart Hotline• Broaden effectiveness across affiliatedcompanies

Facilitating
communication• Held a Stakeholder Dialogue• Utilize the Stakeholder Dialogue

Riskmanagement• Established guidelines for responding to new influenza
viruses• Developed a business continuity plan

• Disseminate the guidelines for responseto new influenza viruses throughout theCompany

Enhancingcustomersatisfaction• Developed the Quality Policy• Reinforced support for marketing/R&D by the Quality
Assurance Office• Began releasing the Voice of Customer ( VOC) daily
newsletter• Improve the product management system
and reinforce operation• Further enhance marketing/R&D support
through smooth operation of the quality
assurance system• Accelerate company-wide dissemination of
the VOC daily newsletter

Employees

Creating
an optimal
workplace• Extended the period of reduced working hours due tochildcare to the end of the year during which the child is in
first grade• Set up a new special paid-leave system in response to thecitizen judicial system• Revised the sexual harassment prevention manual• Began providing specific health checkups and healthcare
advice• Implemented mental health education for managerial level• Promote the Phase 3 Action Plan for the Act
on Advancement of Measures to Support
Raising Next-Generation Children• Confirm the quality of healthcare advice
given by nursing staff• Raise awareness of mental health in theworkplace

Shareholders
andinvestors

Sufficient
information
disclosure• Held briefing sessions for individual investors (2,000
investors in total)• Created and distributed IR brochures for investors• Shared comments from shareholders and investors acrossthe Company (updated intranet)• Imp rove t h e quali t y o f info r mat i o ndisclosure through enhanced website
content• Implement themed events to broaden
understanding of the Company

Business
partners

Promotionof CSR
procurement• Established the CSR Procurement Principles• Inspected palm-oil supplying plantations• Fully inform business partners about theProcurement Principles

SocietyBusiness-related
support forsociety• Supported oral health activities of the LDH*2 and those ofoverseas affiliated companies• Expanded participation in forest maintenance activities inthe Lion Forest in Yamanashi to include retired employees• Established the Lion Award at the Japan Society on Water
Environment• Use forest maintenance ac tivities forenvironmental education

Environment

See p. 23 and following pages.

Management

Customers*2 See pp. 21 and 22 for information on activities of the LDH (Lion Foundation for Dental Health).

8management supervision, while the Executive Committee is
responsible for job execution.
The Board of Directors is comprised of 11 directors. To
revitalize the Board of Directors and to enhance energy andagility, Lion implemented measures such as appointing two
external directors and reducing the director’s term of office to
one year. Lion has appointed two standing auditors and two
external corporate auditors. Furthermore, Lion established theManagement Evaluation Committee as a means of securing
and incorporating the opinions and advice of outside experts
provided from a commonly accepted point of view.
In addition, Lion introduced measures for the largescale purchase of the Company’s stock and related matters(defensive actions against takeovers) after approval at an
ordinary general meeting of shareholders on March 27, 2009.
In December 2006, Lion established the Compensation
Advisory Committee, which is comprised of external directors
and external corporate auditors, for the purpose of enhancing
objectivity and clarity in matters concerning executive
compensation.

Corporate GovernanceFundamental Approach
Lion places the highest priority on enhancing managementtransparency, ensuring prompt decision-making and effective
supervision, and securing compliance. It is our strong belief
that reinforcing and improving the corporate governancesystem will bring to fruition an increase in corporate value.

Corporate Governance System
Lion has adopted an audit system to ensure adequate
management supervision. In March 2004, the Company
introduced an executive officer system, separating theexecutive and supervisory functions. Under the new system,
the Board of Directors is responsible for decision-making and■ CSR Promotion Systems

Shareholders’ Meeting

Main corporate strategy,
such as basic policies of
medium- and long-term
management plans▼

Suggestions

Board of Directors(Management supervision)

▼

Audit

● Decisions on executing key

Corporate Auditors(Compliance Audit)(Job audit)

Oversight

business issues● Supervision of directors’

management functions

Opinion andadvice on
legal
compliance

Audit● Supervision of executive

officers

Opinions and advice on legal
compliance and management policy

ReportReportMandateCompensation Advisory
Committee

Report on executive compensation
Environmental Action
Promotion Committee

Executive Committee (Job Execution)
CSR measures

Audit

Report

CS/PL Committee
Disaster Prevention Meeting

CSR measures(Functional divisions, Products division,Committees)● Raising customer satisfaction● Building a relationship of trust with shareholders andAuditing Office(Internal Audit)

investors● Developing a fair and congenial working environment● Securing fair trading, Social contribution activities● Group-wide environmental protection● Developing environmentally friendly products● Personal information protection

Audit(Audits of legality, fairness
and efficiency, Audits ofprogress on compliance)

Legal compliance, Spreading and maintaining ethics awarenessCorporate Ethics Committee
Lion-Group Charter for Corporate Behavior, Behavioral Guidelines

9▼

Independent Accounting auditors

Management Evaluation
Committee

ReportSenior Executive
Committee

CSR and Lion

Development of Internal Control System
In accordance with the Corporation Law and the Enforcement
Regulations of the Corporation Law, Lion improved thefollowing systems in order to secure appropriateness in theGroup’s business activities.*1
1. A structure to ensure that the executive duties of directors
and employees comply with legal requirements and theCompany’s Articles of Incorporation
2. A management s truc ture relating to information
maintenance and storage of matters concerning theexecution of directors’ duties
3. Rules and other structures for managing the risk of loss
4. A structure to ensure that directors’ duties are executed
efficiently
5. A structure to secure appropriate operations as a corporate
group
6. Matters relating to employees and the independence of
employees from directors in support of corporate auditors
in the case that auditors request such employees
7. A structure for reporting to corporate auditors by directors
and employees and other matters relating to reporting
procedures to corporate auditors
8. A structure to ensure efficient and appropriate auditing bycorporate auditors
9. A structure to ensure the reliability of financial results
reports
10. A structure to ensure the rejection of all contact with
antisocial forces

Evaluation of the Internal Control System
Regarding the Financial Results Report
As regards evaluating and auditing systems within theinternal control system related to the financial results report,
based on the Financial Instruments and Exchange Act, Lion
formulated a special task force team in July 2006, under thepresident’s direction, to further controls on a company-widelevel within the Lion Corporation and the Lion Group, as well
as job-process level controls for operational maintenance. In
December 2008, the Board of Directors adopted the Basic
Internal Control System Policies, which stipulate the following
items.
• Points for developing an internal control system• Respective responsibilities and roles for developing andoperating the internal control system• Scope and methods for evaluating the internal control
system• Evaluating the use of the internal control system• Roles in the evaluation procedure for the internal control
systemIn January 2009, the first year of the system, the Auditing
Office that serves as an evaluation body under the directcontrol of the president began conducting evaluations.
Findings are reported to the president and corporate auditors
while remedial actions, if any, are proposed to the related
divisions followed by progress review.
Evaluation findings and the status of remedial actions will
also be regularly reported to the Board of Directors.
We will prepare an internal control report in March 2010
and proceed with operations so that we can submit thisinformation along with the securities report to the Prime
Minister.

*1 Basic Internal Control System Policies: http://www.lion.co.jp/en/company/html/com0501f.htm

10Customers and Lion

Providing Products that Are Worry-freeand Bring Fresh Excitement to Customers
To provide products and services
that are useful in daily life, Liondeveloped a quality assurance
system in accordance with its quality
policy while promoting companywide quality assurance activities
in the framework of its productmanagement system.

products in its quality policy to further strengthen its quality
assurance activities and assurance system.

Quality Assurance System

Operation of the product management system

Reinforcing the quality assurance system
To promote quality assurance activities across the Company,
Lion set up a CS/PL*1 Committee, which consists of the
CSR Promotion Department (Quality Assurance Office andConsumer Service Office), the Product Division, the Production
Division, the Research and Development Division and the
Headquarters Staff Division. The committees operate fromthe perspective of quality assurance to handle companywide promotion of compliance-related activities, the settingof voluntary standards and targets and the developmentof superior products as well as monitoring the progress of
responses to issues in these areas.
In March 2008, Lion clearly stated the spirit of its company
motto and management philosophy with regard to its■ Quality assurance system

Executive Board
CS/PL Committee
Chair: Director in charge
Secretariat: CSR Promotion Department
Members:
Directors of the Product Division, the Production
Division, the Research and Development Division and the
Headquarters Staff Division

Quality control managerof the Planning Division(Director of Planning &Coordination Department)

Individual divisions

Quality control managerof the Production
Division(Director of Production
Coordinating Department)(Director of Research Planning& Administration)

Individual plants

Individual laboratories*1 CS/PL : Customer Satisfaction/Product Liability

11

Quality control managerof the Research andDevelopment Division

Lion operates its product management system rigidly andrationally to develop superior products and services thatare useful in daily life. The product management systemdefines the flow and structure of quality assurance processes
and tasks to be carried out throughout the stages of
product development (strategy, planning, development,
manufacturing, marketing and improvement/discontinuation)in conformity with ISO 9001 (JISQ 9001). To verify that thequality we produce will satisfy customer expectations, Lionholds Quality Verification Meetings during the development
stage and ensures stringent quality control.

Quality audit
The audit controller and audit team members regularly
conduct quality audits of the Company and contractors andprovide instruction for improvement as needed. In 2008, a fieldsurvey was carried out at target company sites and contractors
in light of the timing and evaluation results of the previous
survey.

Thorough employee education to bolster
understanding of quality and product safety
To promote the development of superior products, Lion
provides employees with education and training to bolster
understanding of product quality and safety. In 2008, theCompany revised its product management system to further
strengthen its quality assurance system and trained employees
so they would fully understand the system. In addition,
Product Division staff received training on the effective use ofcustomer feedback in which they directly listened to customer
comments.

The mission of Lion Corporation is to provide superior products
and services that are useful in daily life, while achieving customer
satisfaction and trust. Ceaselessly implementing quality assurance
activities, the Company is striving to increase customer satisfaction.

3. Considering the global environment
Reducing the burden of products and services on the global
environment, Lion is aiming to create a sustainable society.

1. The importance of customer communication

4. Compliance with laws and regulations

The serious consideration given to customer comments isreflected in Lion’s products and services.
Along with gathering information related to quality, Lion
provides information that is accurate and easy to understand.

Complying with related laws and internal company regulations,
Lion is improving its quality assurance activities.

2. Lion thoroughly pursues safety and functionality in allof its products

By ceaselessly engaging in the creation of attractive products,
Lion is working to increase customer satisfaction.

Customers and Lion

Quality Policy

5. Providing products and services that are full offresh surprises

Thoroughly pursuing safety features, Lion is actively engaged in
improving product capabilities.

March 28, 2008

Efforts for Reliability, Safety and Quality
Lion implements quality assurance activities at every stage of product planning, product development, manufacturing,promotion and response to customers in order to deliver products that fully satisfy customers.

Enhanced customer
satisfaction▲

5 Response to customers
Lion incorporates customer
feedback to improve products andservices.

Customers
Requests

Dissatisfaction

Consultation

4 Promotion
Lion communicates merchandise
information in an easy-tounderstand manner in its storesand through the media such as
newspapers and TV to ensure
product quality is understood.

Research

1 Product planning
Lion sets quality targets to satisfy
customer needs by incorporating
customer feedback into planning.

3 Manufacturing
2 Product development
Lion proceeds with productdevelopment only after
developing quality targets thatreflect customer feedback into
product design quality.

Lion manufactures productswith consistent quality throughthorough, strict control of raw
materials and manufacturing
processes.

Continued on the next page12

1 Product planning
Customer feedback
Feedback from customers isused to better understandtheir expectations andrequests.

Analysis/deliberation

Planning proposal

Product concepts aredeveloped by utilizing
customer feedback
and the results ofmarketing research.

Quality targets are stated in terms
customers can easily understand.
Developing product brief

Marketing research

Product Planning Meeting
Executive Board

Market analysis

The market and competitor
trends are surveyed andanalyzed.

Content of product planning is
discussed before approval.

Customer research
Our customers’ daily
activities, purchasing
behavior, awareness, needs
and desires are researched.

2 Product development
Examining ingredients/package, process/equipment and productdisplays that satisfy product design quality standards
Ingredients/package

Process/equipment

Product Displays

Production Technology Meeting
Deliberation and approvalof the development results
Product Planning Meeting
Deliberation and approval ofmarketing plan
Executive Board
Decision on marketing plan

Reviewed from theperspectives of safety, function
and performance, usability, etc.

Factors such as the quality of raw
materials and productivity are
examined.

Quality Verification Meeting (at the start ofdevelopment) Confirms the appropriateness ofquality targets and items required for consideringdevelopment

Displays that are easy
for customers to read isdeliberated.

Quality Verification Meeting (when development
are completed)
Confirms that the developed product satisfies
expectations

Process Safety Verification
Meeting
Confirms the safety of the
manufacturing process

3 Manufacturing

13

Pre-manufacturing
preparation

Trial
manufacturing

Manufacturing

Storage(shipment)

Specifications andstandards are establishedand the quality of raw
material is confirmed.

Decisions are made on
mass production after
confirming manufacturing
quality and production
capacity.

A consistent level of productquality is maintained by carryingout manufacturing based on the
production plan.

Products manufactured
in plants are stored undersuitable conditions.
Freshness and quality
management isconducted during storage.

Wholesalers and retailers

Promotion

Customers

Lion provides information to wholesale
and retail staff to ensure complete
understanding of product features,usage and quality.

Lion distributes samples and displays merchandize
information in the storefront and also disseminates
information through newspapers and television
so that customers can learn more about theCompany’s products.

Customers and Lion

4 Promotion

5 Response to customers
Customers

Report through VOC Daily Bulletin• Inquiry• Opinion• Proposal etc.

Consumer Service Office
Phone
LetterE-mail etc.

Answer andresponse

Directors,
corporate auditors,
executive officers

Planning, development,
manufacturing, marketing
and advertising
departments
Lion makes use of feedback about productproblems to prevent recurrence and takes
advantage of inquiries and complaints to support
improvements, new product development and aconsistent flow of information.

Consultation support
database

Product
development
andimprovement
Lion makes useof consumer
feedback to
improve productperformance anddisplays as well as
to develop new
products.

Information sharing
systemPing-Pong System

14

Effectively responding to consumer feedback
Consumer inquiries and comments

Disseminating information

In 2008, almost 90 thousand inquiries and comments werereceived by the Consumer Service Office (a 3% decrease
from the previous year). Broken down by category, 79% of
the inquiries related to usage, retailers and product safety;
11% related to dissatisfaction with effectiveness, fragrance
or taste after using a Company product (a 4% decrease
from the previous year); 10% related to product problems,such as deterioration during storage and detergent-related
floor damage caused by spillage while refilling (a 12%
decrease from the previous year).
In 2008 we introduced a search system for consumers
who inquire on where our products are sold in order toafford more timely responses to consumers.

Lion’s website makes available information about
campaigns, current and discontinued products as well as
useful hints for daily living, such as laundry washing andoral care. The site also provides answers to frequently asked
questions and explains how to deal with such issues asaccidentally ingesting products.
To ensure the reliable use of products by the visually
impaired, the Company publishes the Lion Product Catalog
in Braille, SP code and large-type print, and issues the “Lion
Products and Lifestyle Information Oto (Audio) Mail,” ane-mail magazine that contains information useful for daily
life and is compatible with screen-reading software for thevisually impaired. The catalog and magazine are distributed
free of charge to all interested parties.
We will continue to provide up-to-date information
through such media as our website and printed booklets.

■ Number of inquiries and complaints received at theConsumer Service Office
100,000

Oral and beauty care
Fabric and living

80,00075,86781,084

Medicals
Other

90,70687,71311%
26%

60,00031%

40,00020,0000Concretely responding to customer feedback

32%
2005

2006

2007

2008

■ Breakdown of inquiries and complaints (2008)
Product problems

Improving the locking function of the paper packages
for washing detergents such as TOP
Paper boxes of our washing detergents are equipped witha simple lock to prevent the lid from popping open when
the box falls (see the figure below). Customers commented,
however, that the slit was too narrow to insert the locking
flap. In response, we made improvements by changing theshape of the reinforcement around the slit and enhanced
the interlayer strength (adhesiveness between paper layers)of the hardboard used for the lid.

(defective usability
and property damage)

10%

Dissatisfaction
with product(effectivenessand usability)

11%

Inquiries(product features,usage, retail outlet
availability, safety,
etc.)

79%

Creating a consumer-oriented corporate culture
Since 2005, Lion has been providing training on theeffective use of customer feedback to cultivate nurturinga corporate culture for taking action from the customer’s
point of view. In this training, employees in the productplanning and development divisions directly respondto customer inquiries or complaints. The goal is to have
employees feel closer to customers through dialogue
and as a result create products from the customer’s pointof view. We will further expand the scope of employees
who take this training to establish a consumer-oriented
corporate culture.

15

Recall status of Varsan Hyosatsu Jet Spray

Varsan Hyosatsu Jet Spray for Flying Bugs and Varsan
Hyosatsu Jet Spray for Creeping Bugs have been
voluntarily recalled since August 27, 2007 as a result of
several cases of combustion involving these products.
As of the end of March 2009, 1.48 million of these spraycans have been returned (a 45.5% return rate). If you
have either of these products, contact us for information
on how to return it.
Customer service dedicated to the recall of Varsan
Hyosatsu Jet Spray
Toll-free phone number: 0120-670-225
From 9:00 a.m. to 5:00 p.m.
(excluding weekends and holidays)

Employees and LionTo Maintain a Comfortable Workplace
Where Employees Can Work Cheerfully
Lion offers fair compensationand its human resource
development operations
respect the character andindividuality of each employee.
To ensure a safe and rewarding
workplace, the Company
seeks to establish an optimal
environment for employees towork in while maintaining their
physical and mental health.

Facilitating the Use of Diverse
Human Resources
Lion is aiming to ensure a workplace environment in which
all employees enjoy job satisfaction under fair conditions.
Management by Objectives and self-assessment systems aswell as regular interviews are used for personnel evaluation,
an agreeable approach that facilitates understanding ofevaluation results.
With its many core products for daily living, the Company
is able to provide female employees ample opportunities for■ Employee-related Data (Lion)
2006

2007

2008

Male

1,985

1,965

1,934

Female

509

531

546

Male

47

55

57

Female303525Person15

51

78

Percentage

0.6

2.0

3.1
22.0

Regular employee
New employee*1, 2Retired employees
reemployed
Percentage of females

20.4

21.3

Female management level
staff

Person23

30

32Percentage

3.2

4.3

4.7

Employment rate forhandicapped employees

Person39

45

45Percentage

1.6

1.8

1.8

Employees who tookchildcare leave

Female/Person

2

3

3

Percentage

2.7

5.5

4.4

Male/person

43

38

36

Percentage

100

100

100

Male

0

0

0

Female28

33

34

Shortenedworking hours due
to childcare

Average amount of overtime per month (hours)

8.3

9.2

10.7

Percentage of paid leave taken

42.6

43.0

45.2

Turnover rate up to
three years after hiring*3

Person3912Percentage

1.6

4.1

5.7

*1 Including new employees hired mid-year*2, 3 Revised investigation results and figures

applying know-how obtained from homemaking experiences.
In addition, decisions related to promotion and advancement
are made within a comprehensive context, eliminating any
potential negative influence associated with absence due
to child bearing and rearing, so that female employees cannurture their aspirations. With increasing opportunities for
women to take on more active roles, the ratio of female
management staff is also rising.

Balance between work and private life
Lion values the balance between work and the private life of
employees and improves workplace comfortability to bringtangible results. Given the declining birthrate in an aging
society, nurturing the next generation is a pressing issue.
Having accomplished its own action plan in compliancewith the Next Generation Education and Support Promotion
Act, Lion was certified as a “company that proactively engages
in striking the balance between work and childcare” in 2007
and 2009. During this time, Lion extended the timeframe forshortened working hours due to childcare to the end of theyear in which the child is in first grade. We also support flexible
work styles, such as use of flextime systems. At present, 100%of Lion’s eligible female employees have acquired maternity
leave. The number of male employees that take leave is alsosteadily increasing (a total of eight by the end of 2008). Beyond
simply introducing these systems, Lion establishes a corporate
climate that encourages employees to actually use them. We
will work on the Next Generation Act Phase 3 Action Plan
presented below until 2011.
Next Generation Act Phase 3
Action Plan
Period: April 2009 to March 2011
“Kurumin” next generation
certification markGoal 1. Reach a point at which seven male employees or more use thesystems, such as paternity leave, during the Phase 3 Action Plan period
Goal 2. Grant one day of scheduled paid leave in 2009
Goal 3. Develop an environment for disseminating corporate information
via the intranet to employees on maternity leave
Goal 4. Introduce measures to rehire employees who had resigned for
personal reasons16Retired Worker Reemployment Systems
In April 2006, Lion introduced two types of Retired Worker
Reemployment Systems: In the standard t ype, retired
employees can choose the most suitable job for themfrom among a list of jobs offered by Lion; and in the highly
specialized type, Lion appoints certain retired employees who
have indispensable knowledge and expertise for particular
positions. In the three years since the establishment of thesystem, about 60% of retired employees have used it and arecontentedly applying the skills, knowledge and experience
they have cultivated.

Preventing Workplace Harassment
Lion has been working to prevent various types of harassmentthat negatively impact the work environment. In 1999, theCompany issued a declaration to prevent sexual harassment
and developed manuals for managers and employees. In 2008,
the Company compiled examples of power harassment cases
to call managers’ attention to problems that could occur while
coaching subordinates.

Employee Health Management
Employee Health is an Asset to Lion
Considering that employee health is the most important asset
both for the individual and the Company, Lion is conducting
activities based on its Fundamental Health Management
Policy. Activities that promote an increase in the numberof employees who can manage their own health as well asactivities that build a comfortable workplace are key pillarsof this policy. In addition to such measures as post-checkup
interviews with all employees, Lion is finely tuning its healthmanagement activities in consultation with industrial
healthcare professionals.
■ Outlining the aim of Lion’s Fundamental HealthManagement Policy

Health Self-Management
Health Assessment
Healthy Lifestyle

Spirit of Tenacity and Creativity—Human Resource Development

Health Level Maintenance/
Improvement

Industrial Health(Labor HealthManagement
and Industrial
Hygiene)Service

Improving Work Life Quality

Lion provides diverse oppor tunities for employees todevelop their abilities. Taking qualifications, age and job
duties into consideration, the Company provides training
at each level of employment, career development training,and specialized education. Lion also provides a variety of
training programs, especially for motivated employees. These
additional programs include elective training and support
for self-development. Particularly in terms of supporting
self-development, Lion provides a diverse array of courses
to assist employees in developing their capabilities. The
Company is also implementing human resource development
measures that include the Lion Challenge Cup, which provides
employees with opportunities to present results of groupstudy directly to executives; and opportunities for international
workforce training, which include business training at overseas
affiliates and presentations at overseas conferences to develop
human resources for overseas operations in response to theglobalization of the business.
For further details of Lion’s personnel and training systems,
see the Company website.*1

17*1 Employment opportunities HP http://www.lion.co.jp/ja/saiyo/ (In Japanese)

Creating a Supportive
Environment
Evaluating Harmful
Factors in the Workplace
Eliminating Harmful Factors
Formulating a Comfortable
Workplace Environment

Building a Healthy Company• The ratio of employees who underwent annual health checkups in 2008: 100%
• The ratio of post-checkup interviews conducted and health guidance provided
in 2007: 96.7%

Responding to Specific Health Checkups andSpecific Healthcare Advice
Regarding the measures for specific health checkups forindividuals 40 years old or over and the provision of specifichealthcare advice that was enacted into law in fiscal 2008, Liondeveloped a five-year plan to promote health checkups andhealthcare advice for insured employees with the cooperationof Lion’s own health insurance association.

Taking Action for Mental Health
Given that mental health is an important issue both in termsof a corporate organization’s vitality and its risk management
strategies, Lion is making every effort to identify and prevent
emotional problems among its employees. In addition to its
internal industrial and mental health consultation system, theCompany has also contracted clinical psychotherapists toprovide counseling to employees internally and counselingorganizations to provide these services externally, making it
possible for employees and their families to readily obtaincounseling over the telephone and in person.

Company-wide Endeavors in Safety, Health andDisaster Prevention Management
Lion is striving to ensure safety on a routine basis under the
principle of safety comes before anything else. The Company
has constructed a safety, health and disaster prevention
management system while raising employee awareness andproviding training through measures such as briefing sessions
at individual business sites. Under this system, we are steadily
working to accomplish the goals of “no accidents” and “nodisasters” as well as to build a framework that minimizes theimpact of unavoidable emergencies.
Work Safety
To maintain top priority on work safety, Lion routinely invites
lecturers from inside and outside of the Company to provide
safety education and advice. There were no major accidents
or disasters impacting people or equipment in 2008. However,there was one accident that involved lost work time andseven accidents that did not. Incidents of chemical-related
injuries increased. To address this issue, we are implementing
improvements focused on risk assessment concerning thehandling of chemical substances.
Facility Safety
Lion ensures the safety of chemical plants through assessment
by an external institution. Following assessment at the Chiba
Plant in 2005, the Company adopted this same process forconfirming safety at the plants of Lion Chemical Co., Ltd.,the Fine Chemical Division, and overseas affiliates (in Korea,
Malaysia and Thailand) and completed remedial actions in2008. Recognizing the importance of routine monitoring forchemical plants, we are also conducting periodic inspections.
In addition, we recognize that the efficient assessment andrepair of aging plant facilities represent obstacles for the future,
and we have therefore begun efforts to ensure equipment
safety by proactively adopting advanced assessment methods.
Management and employees must work together to ensure
safety. And we intend to maintain the safety of our equipment
by further improving our management cycle including an
increase in reviews by the executives.

Response to Emergencies
To ensure a prompt and effective response and safeguard thesafety of employees in times of disaster, Lion has developed
manuals at each business site. These are in addition to regular
evacuation drills and practices for confirming the safety ofpeople and joint training with fire departments.
In 2008, Lion conducted a training exercise for quickly
restoring business operations under the scenario that a
Tonankai (area between central and south-west Japan)
earthquake had hit the Nagoya Office and Lion AKZO Co., Ltd.
Yokkaichi Plant. In this drill, the Tokyo headquarters supported

Employees and Lion

Safety and Disaster Prevention

the disaster headquarters in the stricken area by using a video
teleconference system and other means.
Individual departments and business sites also conduct
timely training using a system to quickly and accurately
confirm the well-being of employees in the event of disaster.
Having completed seismic reinforcement of the officebuildings owned by the Group, Lion is conducting a seriesof seismic assessments and reinforcement work at its plants.
These efforts have been completed at the Chiba, Odawara
and Akashi plants, and reinforcement is currently underway
at the Osaka Plant. We will continue making improvements tominimize damage in the event of a disaster.
■ Number of facility disasters
2004

2005

2006

2007

2008

0

0

0

0

0

■ Number of work accidents(excluding those during commuting hours)
Research Division
Production Division
Office Division■ Frequency of work accidents in the production division(number of victims of accidents that involved lost work
time / total working hours (million hours))
2004

2005

2006

2007

2008

0.00

0.00

0.00

0.00

0.74

■ Severity of work accidents in the production division(person-days lost / total actual working hours(thousand hours))
2004

2005

2006

2007

2008

0.00

0.00

0.00

0.00

0.03

■ Accident-free working hours at the end of 2008

(10 thousand hours)

Research Division
Hirai
529

Production Division

Honjo Odawara Fukushima Chiba Odawara Osaka Akashi
25

91

7

250

198

146

14

Emergency drill at Akashi Plant(December 12, 2008)18

Business Partners and Lion

Working to Achieve a Sustainable Society
through Our Supply Chain
Driven by concerns aboutcompliance, quality, environmental
protection, labor and human rights
in the supply chain, Lion aspires
to fulfill its responsibility together
with its business partners forachieving a sustainable society.
The Company reinforced CSR
activities throughout its supply
chain in 2008 by establishing
new procurement principles andconducting a questionnaire survey
on corporate activities.

Procurement Principles
Since its foundation, Lion has been doing its utmost
to provide safe, high quality products and services
that promote healthy, comfor table lifest yles.
Upholding this effort in the procurement of raw
materials and the purchase of products, and with thecooperation of our business partners, we shall:
1. Comply with prevailing laws and social norms andengage in appropriate, rational transactions withevery business partner in a freely competitive
framework that is equitable, fair, and transparent;
2. Rationally select business partners on the basisof quality, cost, and timely delivery to fulfill our
responsibility to customers;
3. Fully consider throughout purchasing activities
our social responsibilities in such areas as global
environmental protection, labor, and human rights
toward creating a sustainable, healthy society;
4. Respect the confidentiality of business partners’
information and intellectual property rights
and never engage in inappropriate or unethicalacquisition or use of such information or rights;
5. Never offer business entertainment, gifts, ormonetary compensation to unfairly obtain profit;
6. Fulfill our social responsibilities together with ourbusiness partners with a shared commitment tocoexistence and co-prosperity.

Promoting Cooperative Relationships with
Business Partners
Advancing CSR Procurement
Lion has been constructing supply chain management
systems and at the same time ensuring fair raw material
procurement and product purchasing under its Purchasing
Activity Principles.
To more clearly grasp the CSR ac tivit y status of its
business partners, Lion conducted a survey in 2008 using aquestionnaire that consisted of six items, compliance, quality/
safety of products and services, environmental consideration,
labor and human rights, fair trade, and activities in overseas
business sites, which were selected using the Ten Principles of
the Global Compact*1 as a reference. With the cooperation ofseveral Group companies*2, the questionnaire was sent to 564
business partners and received responses from 395 (response
rate of 70%). In reviewing the responses, no major problems
were discovered. Overall, the development of policies andsystems in their overseas business operations, however,
was not deemed sufficient compared with their domestic
businesses. Another finding was that larger scale companies
tended to have more advanced CSR efforts.
Lion drew upon these findings to establish its Procurement
Principles on October 1, 2008, as CSR-based procurement
principles with clearer social and environmental considerations.
We will strive to thoroughly implement these principles
and identify potential problems encompassing all business
partners, including those who did not respond to the survey.

Established October 1, 2008
*1 The Ten Principles of the Global Compact HP http://www.unglobalcompact.org/aboutTheGC/TheTenPrinciples/index.html
These principles were espoused by Kofi Annan, the Secretary-General of the United Nations at the time, at the World Economic Forum held in January 1991, and they were formallyinaugurated at the UN Headquarters in July 2000.
2* Lion Chemical Co., Ltd., Lion Packaging Co., Ltd., Lion Corporation, Lion Hygiene Co., Ltd., Ipposha Oil Industries Co., Ltd., Calp Corporation

19

Moving toward Product Development that Has theHighest Customer Satisfaction

The essence of Lion’s logistics policy is “coexistence andco-prosperity” founded on close ties with wholesalers.
Regarding the marketing of consumer products, the Company
has established an organized structure to promote better
communications. One feature of this structure is “Lion-kai,”
which has 266 wholesaler members as of January 1, 2009.
In Lion-kai meetings, Lion provides an explanation of its
business strategies and sales and marketing strategies, whileat the same time clarifying roles and responsibilities throughvigorous exchanges of opinion. In this way, Lion works inunison with wholesalers to improve customer satisfaction.
Over the last few years, nationwide wholesalers that handle awide range of products have also appeared in the distribution
business for household and medical products. Against thisbackground and with the revised Pharmaceutical Affairs
Act firmly in mind, we have been advancing the integrationof product divisions for household and medical products
since 2006 and have prepared a framework to support
integrated operations. We set up the Customer Development
Department in 2009 to share and resolve business challenges
with wholesalers and retailers.
For our wholesalers and retailers, Lion holds the Spring New
Product Presentation, during which the Company introducesa broad range of new products including household, medical
and gift products. At each product booth, Lion researchers
provide easy-to-understand explanations of product features,
while suggestions related to marketing methods and thecreation of product display areas are offered by the Product
Division.
Supported by the mutual understanding that these efforts
cultivate between wholesalers, retailers and Lion, store
coordinators from Lion Field Marketing Co., Ltd. and Leo Field
Promotions Co., Ltd. regularly visit about 8,600 stores. The
coordinators collect information concerning customer needs
and distributor requirements. At the same time, they work tocreate fresh, attractive product display areas at retail outlets,
ensuring a quality that satisfies customers.

Given that the development, stable supply and quality
assurance management of new materials and raw materials
with new functions are very important for making productsthat satisfy customers, cooperative ties between the Company
and suppliers are indispensable. To this end, Lion exchanges
information with suppliers to deepen these trusting
relationships through its regular business activities, while
making every effort to gain a precise understanding of thelatest trends concerning raw materials.
One example of this is our development of user-friendly
packages and tools. We are working together with package
manufacturers to improve both product quality and operating
efficiency by providing them with consumer testing results ofour product prototypes and mutually sharing design software.
We also sign confidentialit y agreements toward fairtransactions in the development of new functional materials,
which in turn accelerates such development.
Lion has also established standards from the perspectivesof safety, environmental suitability and quality that are
applied to its purchases of new raw materials, ensuring full
implementation of safety measures including inspections of
manufacturing facilities.
To cope with the skyrocketing raw material prices from 2007
to 2008, the Company worked to secure the stable supplyof major raw materials and to reduce costs on both sides bypurchasing from multiple suppliers and increasing delivery
units.

Spring New Product Presentation(January 25, 2009)

Lion-kai (February 10, 2009)

Business Partners and Lion

Working Together with Wholesalers and Retailers—
Creating Product Displays that Provide Customer
Satisfaction

Working Together with Competitors“Competing at the point of sales, while distributing
in cooperation”
Together with a competing manufacturer, Lion established
Planet Logistics Co., Ltd. in 1989 and conduc ts joint
shipments to wholesalers. The idea behind joint shipments
is to compete at the point of sales, while distributing incooperation. Each manufacturer competes fairly at the store
level, while leveraging the advantages of joint distribution.
These advantages include: (1) a reduction in logistics costs; (2)enhanced logistics quality; and (3) more appropriate measures
to address environmental issues. Enforcement of the revised
Law concerning the Rational Use of Energy in 2006 further
increased the importance of efforts for preventing global
warming in distribution. We recognize that joint distribution is
an important solution for this challenge. As of the end of 2008,
18 manufacturers had participated in joint distribution.
Set schedules, set volumes, bulk shipping, systemizationand standardization related to joint distribution are directly
connected to operational improvement and efficiency forbusinesses to which Lion delivers (see p. 31 for more details).

20

Society and Lion

Undertaking Social Contribution Activities Focusedon Oral Hygiene and Aquatic Environments
Lion contributes to society byhelping it achieve health andcomfort. In particular, since its
founding, the Company has
consistently promoted andprovided education on proper oralcare. Lion is also strengthening
its efforts to preserve aquatic
environments*1 while placingemphasis on support for academic
and educational activities,
coexistence with communities andrespect for the volunteer spirit of
employees.

Social Contribution through Support for the Lion Foundation for Dental Health
Since 1913 when the Company initiated Lion Lecture
Meetings under the concept of returning to society a
portion of its profits from business operations, Lion has
been consistently promoting and providing education
on oral care. Actions include the setting up of Japan’s firstclinic specialized in pediatric dentistry (1921), a primaryschool visiting program (since 1922) and Mass Tooth
Brushing Exercise for School Children (since 1932).

Lion established the Lion Foundation for Dental Health(LDH) in 1964 and carried out a broad range of public
promotional and education activities through its support
for the LDH. We are now conducting activities for oral
health tailored to each life stage and community-basedmodel activities for oral health in response to the needs ofthe times.

2008 activities related to oral care promotion and education and dental care

1

4

Dental Health
Activities for Mothers
and Children

Oral Health Checkup
Activities at Worksites

2

5

Visiting Schools andKindergartens toOffer Presentations

Oral Care Activities
to Provide Advice
for the Elderly

3

6

Mass Tooth Brushing
Exercise for School Children

Dental Care Activities

Events held: 38 times at 38 places
Participants: 983 children and 994 parents

Number of schools andkindergartens that had programs: 694 times
at 487 schools and kindergartens
Number of participants: 50,165 children
and 3,312 parents

Number of participating elementary school
students: 1,400
Number of participating
dental hygienist school students: 1,700*1 See pp. 5 and 6 (Special Topic 2) for aquatic environment preservation activities.

21

Number of businesses
visited: 519 times at 237 places
Number of participants: 30,359

Events held: 50 times at 46 places
Number of participants: 1,246

Number of patients: 12,658

Society and Lion

● Activities for Oral Health Tailored to Each Life Stage
Following our belief that the well-being of the body
The LDH is working to improve the quality of life by
begins with a healthy mouth, the LDH engages inmaintaining and enhancing functions of the mouth sucheducational activities related to oral health for people inas eating, talking and laughing, for an entire lifetime.
every stage of life, from infancy to old age.
■ Activities of the LDH at each stage of life
Age

5

Birth

Life stage

Dentalcharacteristics

10

15

Fetal

InfancyChildhood

Puberty• Toothformation• Toothformation• Frequent
occurrenceof babyteeth
cavities• Replacementwithpermanentteeth• Frequent
occurrenceof cavities on
permanentteeth• Onset ofgingivitis• Increase ofgingivitis

20

30

40

50

60

Adulthood

Middle age• Onset of periodontitis• Start of tooth loss
• Advanced phase of
periodontitis• Frequent occurrence of root
cavities

Dental Health Activities for
Parents and Children

80

Senior• Rapid increase in toothloss

Dental Health Activities for Adults
Visiting Schools andKindergartens for Training
Programs

LDH activities

70

Dental Health Activities
for the Elderly

Dental Health Activities for the Handicapped
Dental Health Activities for the Community
Research, Dental Care, Information Dissemination● Community-based Dental Care Activities
To increase public awareness of oral health, the LDH has
been conducting activities for oral health tailored to eachlife stage since 2007, with the selection of Sumida Ward,the location of the LDH’s Tokyo office, as a model area. In
cooperation with the Sumida Ward Government, primaryand junior high schools in that area, the Dental Association,
the Chamber of Commerce and Industry and otherorganizations, we support ward residents in maintaining
and improving their oral health to build momentum inthe movement for “A Healthy Mind and Body Begins witha Healthy Mouth.” In 2008, 45 activities were carried out in
Sumida Ward involving about 3,700 participants.
The LDH plans to expand this local movement to theentire nation.

■ Oral health activities in cooperation with various organizations
Support for child raising
Bunka, Sumida Ward

Food education festival
Sumida Riverside HallWith governments andschools

Summer holiday sumo calisthenics
Ryogoku Kokugikan (NationalSports Arena)

Preserving and
Improving the Oral
Health of Sumida
Ward Residents

Kaekko Bazaar
Sumida Sangyokaikan

With institutions
and organizations

Spring/summer holiday extra lessons forprimary school children
Lion Headquarters Building Auditorium
Club for the elderly
Higashi Komagata
Community Center

Lectures for businesses in the ward
Sumida SME* Center

Providing oral health advice atjunior high schools

With dental
association and others
Dental consulting for workers
Sumida SME* Center

Oral care activities to provide advice
for employees working for small andmedium-sized corporations in Sumida
Chamber of Commerce and Industry*SME: Small and medium-sized enterprise

For more details' please visit the LDH's website. HP http://www.lion-dent-health.or.jp/ (in Japanese)

22

The Environment and Lion

Aiming to Become a Leading Company inEnvironmental FriendlinessAs a company that provides
products used in consumers’
everyday lives, Lion views
protecting the environment as
a fundamental management
concern. The Company is thus
actively involved in protecting
the global environment toward
creating a sustainable, low-carbon,
recycling-oriented society.

Environmental Management System
Aiming to become a leading company in environmental friendliness, Lion is implementing ECO LION activities, which areenvironmental activities carried out companywide within the framework of the Environmental Guidelines. The Company
also maintains an environmental management structure and system to strengthen efforts to protect the environment.
Furthermore, Lion is striving to raise the environmental awareness of its employees.

Environmental Guidelines
Lion is to act voluntarily and proactively to reduce the environmental
burden of its corporate activities—from research and development to raw materials procurement, manufacturing, logistics,
sales and marketing, household use, and disposal—on the
global environment, with due consideration to global warming
prevention, effective use and recycling of natural resources andcontribution to the improvement of people’s health and thenatural ecosystem.
(1) Aiming for a Sustainable SocietyE stablish an environmental management system, andthrough ongoing maintenance and improvement of thatsystem, protect the global environment.
(2) Complying with Legal and Other Requirements
C omply with the system of legislation, regulations andarrangements pertaining to environmental protection andestablish and implement voluntary standards of conduct.
(3) Setting and Verifying Implementation of Environmental
Objectives and Targets
Correctly understand the environmental impact of corporate
activity, and as far as technically and economically possible,
establish objectives and targets for improvement, while atthe same time formulating, implementing and regularly
verifying the status of implementation of an environmental
management program.

23(4) Developing Environment-Friendly Products
C ontinue aggressively with produc t development inaccordance with Lion’s own “Three Principles of Environmentally Responsible Composition Development” and the“3Rs of Container and Packaging Reduction.”(5) Advancing Green Supply Chain Management
Construct a green supply chain with raw material suppliers,
OEM partners and retail outlets and strive for environmental
burden reduction throughout entire product lifecycles, fromprocurement to sale to customers.
(6) Enhancing Environmental Protection Activities Based on Uniform
Understanding of the Guidelines within the Lion GroupDisseminate the Guidelines to all Lion employees, including
those of its affiliated companies, raise an awareness ofenvironmental protec tion among them and bolster
environmental management activities throughout the entire
Lion Group.
(7) Promoting Disclosure of InformationS eek to maintain and promote communication with stakeholders
involved in Lion’s businesses. These Environmental Guidelines arefreely available to anyone upon request.
Revised April 3, 2006

The Environmental Management System

Lion has formulated its Environmental Guidelines in line withthe underlying spirit of the Lion-Group Charter for Corporate
Behavior, which states: “We shall play a positive and activerole in creating a sustainable society, harmonizing economic
development and environmental protection.”
In April 2006, Lion revised its Environmental Guidelines(see p. 23) to include the aggressive development ofenvironmentally friendly products as well as reduction ofenvironmental impact throughout the entire supply chain
to clearly express the Company’s commitment to ECO LION
activities.

The environmental management system facilitates themeasurement, evaluation and reduction of the environmental
impact associated with our business operations, products andservices. Lion deploys the system for continuous improvementof its environmental protection activities in the framework of
the Environmental Guidelines using the Plan, Do, Check, andAct (PDCA) cycle.

Environmental Management Structure
For accommodating collaboration of all employees within
the Lion Group for tackling environmental issues, Lion
established the Environmental Action Promotion Committee,
which involves the production, administrative and marketing,research & development and headquarters staff divisions.
By constantly reviewing the status of business operations
from the perspective of environmental protection, we areworking to ensure legal compliance and have set up voluntarystandards and targets to precisely discern progress to date.
■ Environmental management structure
Executive Committee

Environmental Action Promotion Committee
Chair: Director in charge
Secretariat: CSR Promotion Department, Environmental
Conservation OfficeMembers: Heads of the production division, theadministrative and marketing divisions, the research& development division and the headquarters staff
division

Chief environmental management
officer of the Lion Group(Director of Environmental
Conservation Office)Quality control
manager of the
Production Division(Director of Production
Coordinating
Department No. 1)

Individual plants

The Environment and Lion

Environmental Guidelines

Waste and Recycling GovernanceTo ensure compliance with laws concerning waste treatment
and to fulfill our Producer Responsibility, we established a
Waste and Recycling Governance System in 2006 for the entire
Group in order to unify and standardize the management ofwaste treatment and recycling. Having clarified management
responsibility through this system, the Company is working
to prevent related problems and encourage recycling by
supporting appropriate waste treatment and information
sharing. Results are reviewed through internal audit, andperiodic audits are conducted by Lion’s director in charge,
who orders improvements as required.

Status of ISO 14001* Certifications
All of Lion’s factories obtained ISO 14001 certification in July
2001. The Japan Management Association Quality Assurance
Registration Center subsequently conducted triennial reviews
at Lion in May 2004 and 2007, resulting in renewed certificationin both years. The Company also underwent a certification
review in 2008, and we are continuing to improve ourmanagement system and environmental protection activities
based on the results.

Legal Compliance
Lion complies with all environmental regulations, laws andordinances. No violations requiring penalties or fines occurredin 2008.

Internal Environmental Audit

Chief environmental
management officerof the administrativeand marketing
divisions

Quality control
manager of theAffiliatedResearch andcompanies
Development Division(Director of General
Affairs Department)(Director of Research
Planning & Administration )Individual offices

Individual laboratories

Employees who qualify as Internal Environmental Auditors
after receiving “Education to Foster Internal Environmental
Auditors” regularly carry out internal environmental audits toconfirm compliance with all ISO requirements. In the eventof any noncompliance, remedial steps are recommended
and the related departments assume the responsibility ofdemonstrating improvement with regard to reported items.
In addition, the director in charge of CSR conducts regularmanagement reviews as environmental audits.

* ISO 14001: An international standard for certification of a company’s voluntary environmental management system; certification requires inspection by an independent third party and confirmsthat a company’s environmental management system meets international standards

24

The Environment and Lion

Lion’s Environmental Goals and Achievements in2008 and CO2 Emission Reduction Targets for 2020
Lion attained its goals virtually in all areas in 2008, with particularly significant results in the reductions of CO2
emissions derived from energy use and total waste. Last year, Lion set long-term goals for further reducing CO2
emissions by 2020 and declared them as its Eco First Commitment.
change in product sales ratio, hindering the planned progressin promoting the use of plant-based ingredients. Last year,
the Lion Group set and announced its targets for reducing
CO2 emissions (in absolute terms) for 2012, the final year of the
Kyoto Protocol, as well as those for 2020 as a post-Kyoto target.
The targets were declared to the Ministry of the Environment
as our Eco First Commitment. Lion is striving to steadily
achieve these lofty goals and is integrating them into futurebusiness plans.

In 2008, the second year of the Lion Group’s Three-Year
Medium-Term Environmental Plan established in 2007,
various measures were initiated for each aspect of the plan,
and achievements are steadily being made. For 2009, Lion
reviewed the original goals that had been accomplished in2008 and replaced them with higher goals. As for the goal for
product-derived CO2 emissions, we adjusted it in accordancewith the long-term goal. This was done because the original
target has become more difficult to accomplish due to theincreased amount of fossil materials used as a result of a

◎ : Attained ○: Almost attained ×: Unattained■ Environmental goals for 2007 to 2009 and achievements in 2008
Results
Item

Reduced CO2
emissionsChemical
substance
management

Waste control

Relatedpage

2009

2008 plan

Principal measures(Results for 2008)

Achievements(Results for 2008)

Reduce CO2 emissions
by 14% or morecompared to the 1990
level

Energy-saving improvements inthe drying process of powderedlaundry detergent production
Installation and upgrading ofenergy conservation devices◎(17% reduction
compared to the1990 level)

Reduce by 10% or more

Reduce by
18% or more

P30

Reduce energy use
per unit of specificproductivity in the
Logistics Division by
1% or more comparedto the 2007 level

Modal shift and shifting tolarger vehicles were pursued,
but the transport of products
increased due to a change inproduction sites

×(104% compared to
the 2007 level)

Reduce by 1% or morecompared to the 2008 level

Reduce by
2% or morecomparedto the 2008
level

P31

Reduce volatile organic
compound (VOC)
emissions by 40% ormore compared to the2000 level

Introduction of VOC recovery
equipment and improved
product composition to reduce
VOC emissions◎(62% reduction
compared to the2000 level)

Reduce by 40% or more

Reduce by
65% or more

P39

Reduce total waste
generation by 44% ormore compared to the1990 level

Promoting the maximization of
resource usage
Reducing unreacted loss byimproving the reaction process◎(49% reduction
compared to the1990 level)

Reduce by 40% or more

Reduce by
50% or more

P32

Reduce final waste
landfill volume by 89%
or more compared to
the 1990 level

Promotion of recycling
programs◎(90% reduction
compared to the1990 level)

Reduce by 90% or more

Same as at
left(not revised)

P32

The increased amount offossil materials used due torising sales in one productsegment prevented any further
reduction in spite of efforts topromote the use of plant-based
ingredients

No 2008 target(100,000ton reduction
compared to the1990 level)

CO2 emissions derived fromproducts reduced by 150,000
tons or more from the 1990
level

Reduce by
105,000 tons
or more

P30

Reduced the amount ofcontainers and packaging
materials used as a result of
implementing innovative,
compact designs and expanded
the use of refill products

No 2008 target(71% compared to
the 1995 level)

Reduce the amount of plastic
containers and packaging
materials used per unit of
specific productivity in eighthome product segments to
70% or less of the 1995 level

Same as at
left(not revised)

P37

Environmental
care throughcompany
products■ CO2 emission reduction plan

In 2020

20% reduction in the amount

40% reduction in the amount

74% reduction in the amount of

88% reduction in the amount of

▼
▼

▼
▼

CO2 emissions derived
from products

Total reduction of CO2 emissions
by 50% of 1990 levels

Original 3-year plan goal

Revision■ Predicted achievement of post-Kyoto Protocol goals

In 2012of CO2 emissions derived
from energy use

25

Goals

(Tons)

Product-derived CO2
Energy-derived CO2

of CO2 emissions derived
from energy use

reduction

CO2 emissions derived
from products

Total reduction of CO2 emissions
by 67% of 1990 levels

1990

2007

2008

2009 (Goal)2012 (Goal)

2020 (Goal)

Lion is working to reduce environmental impact throughout the entire product life cycle, from raw materials
procurement to product disposal. In 2008, significant reductions were achieved in CO2 emissions and total waste
generation.
Up to 2007, Lion published environmental data, including those from domestic consolidated subsidiaries wholly owned by the Company. This year, data of
the Ipposha Oil Industries Co., Ltd. and Lion AKZO Co., Ltd. were added to the scope of the report. The value of 1990 as the reference year was adjusted inaccordance with the revised scope.

INPUT

OUTPUT

Energy consumption decreased,
whereas water consumption
increased

Environmental impact reduced
through reduction of CO2
emissions and waste materials
Discharge to the atmosphere

EnergyTotal amount of energy
consumed(Crude oil equivalent)Electricity

The Environment and LionAn Overview of Environmental Impact from
Business Operations

CO2 emissions

65,711 kL(Reduced 620 kL)

Production division’s 109,575 tons
emissions(Reduced 3,353 tons)

113.431 million kWh(Reduced 2.324 million kWh)Natural gas

15.133 million m33

Other fuels

19,323 kL(Crude oil equivalent)(Home products only)

PRTR chemical
substances

9,999 tons

Office emissions(Reduced 73,000 m )(Increased 419 tons)

79 tonsNOx emissions(Increased 49 kL)(Reduced 4 tons)

25 tons

SOx emissions(Reduced 8 tons)

1,314 kg

PRTR chemical
substances

Materials
Raw materials

119,574 tons

(Reduced 2,934 tons)

383,000 tons

(Reduced 74,000 tons)(The Lion Group)

81,000 tons

Waste water
Waste water(Increased 2,000 tons)(Reduced 542 kg)

757,000 m3(Increased 7,000 m3)
0 kg

PRTR chemical
substances

Waste

Water resources
Water used
Tap water used
Industrial water
used

(±0)

9,006 tons

Total waste generation

1,414,000 m3(Increased 49,000 m3)(Reduced 931 tons)

Consigned for recycling

410,000 m3(Reduced 7,000 m3)

4,106 tons

(Reduced 484 tons)

Final waste landfill volume

764 tons(Reduced 82 tons)

1,004,000 m3(Increased 56,000 m3)

Distribution
CO2 emissions

22,472 tons

(Reduced 341 tons)

Distribution

Products
Net sales
Waste packaging

Note: Figures in parentheses indicate the change
from last year’s results.

338.2 billion(Reduced 3.5 billion)

41,649 tons

(Increased 230 tons)

Customers

26

The Environment and Lion

Environmental Accounting andEco-efficiency
Environmental accounting is a key indicator for pursuing efficient and sustainable environmental protection activities.
Lion will continue to improve its environmental actions by using environmental accounting to gain a comprehensive
picture.

of its products, the Lion Group lists environmentally friendly
products under the business-area cost associated withenvironmental protection costs. Environmental protection
costs of environmentally friendly products are calculated bymultiplying a product’s environment friendly coefficients,
determined using Lion Eco Standards, by the investments andfacility costs of the product. The calculations for manufacturing
facilities that produce several kinds of products, however,are adjusted to take into account manufacturing volume at a
facility by applying a weighted-distribution method.
Lion Eco Standards are used across the Company to facilitate thedevelopment of environmentally friendly products (see p. 33).
Environmental protection ef fects reflect the results ofenvironmental protection efforts expressed in quantitative terms.
Lion set four items for determining economic effects (realEnvironmental Accounting
Lion Group’s Environmental Accounting
Every year, Lion calculates the aggregated economic effects(real effects) associated with the actions, costs and outcomesof environmental protection efforts throughout the Group
under Ministry of the Environment guidelines.
The costs of environmental protection refer to investments
and expenses for such activities as prevention, containment,risk management and damage mitigation associated with theenvironmental impact of business operations.
Having placed high priority on the environmentally friendliness■ Economic benefits associated with environmental protection measures( ): Reduction

Item
Category

Business area
costs

Principal activities

Investment

Cost

Item

effects

79
25
15
21

(4)
(8)
(3)
4

P32
P39−40

119,574
1,003,764
410,217756,971(2,934)56,094(6,987)
6,813

P30−32

9,006
764
69

(931)
(82)
(13)

25

121

NOx emissions (tons)
SOx emissions (tons)
Particulate emissions (tons)
Total COD (tons)

Environmental protection
Energy conservation, etc.

100

4,860

Energy consumption (tons of CO2)
Industrial water used (m3)
Tap water used (m3)
Wastewater emissions (m3)Resource recycling
Waste disposal, recycling, etc.

1362

Total waste generated (tons)
Total waste volume for final landfill (tons)
Recycling rate (%) (Volume of recycling/ Volume of waste consignment)

Environment-friendly products
Environment-friendly productmanufacturing facilities, etc.

1,267

2,893

Use of biodegradable materials, plant-based materials,
compact products, refillable products, recycled paper,
reprocessed PET bottles, etc.

607

Packaging materials used (tons)
Product waste (tons)

Upstream/
downstream
costs

Commissioning costs incurred inconnection with the Containers andPackaging Recycling Law and productwaste disposal, etc.

Managerial
activity costs

ISO 14001 renewal expenses,
environmental education, publicationof reports, exhibitions, etc.

Research anddevelopment
costs

Environment-friendly productdevelopment expenses, etc.

Community
service costs
Environmental
damage costs

Related page

2008

Pollution prevention
Air pollution prevention,
Water pollution prevention, etc.

72,760
4,027

P32

P33−38(1,071)(1,887)

P37−381

598

P24
P41−42

106

1,286

P33−34
P37−38

Regional environmental activities,
donations, etc.

017P41−42

Costs for soil improvement, etc.

0

15

P40

1,500

10,759

Total

27

Item

Summary of 2008 Environmental Accounting
Environmental protection costs
Total investment in 2008 was approx. 1.5 billion yen, down by
approx. 2.6 billion yen from 2007. This is because a significant
investment was made for facility relocation and otherpurposes in 2007, whereas investment in 2008 was limited toa small number of facilities, including the reinforcement of
packaging facilities at the Osaka Plant. Expenses were approx.
10.8 billion yen, down by 0.18 billion from 2007 due to the
reduced treatment cost of voluntarily recalled products.
Environmental protection effects
Energy consumed (in tons-CO2) declined by approx. 3,000
tons-CO2 due to the decrease in heavy oil used for the heatsource in the distillation process. Industrial water use increased
by approx. 56,000 tons as a result of the washing work
accompanying product switching. Tap water use decreased
by approx. 7,000 tons as purified industrial water was used inplace of tap water. Total waste generation dropped by approx.
900 tons as a result of reduced waste acid through equipment
improvements and efforts to transform waste into valuable
resources.
Economic effects (real effects)
Decline in cost due to natural resources conservation wasapprox. 290 million yen. This was the result of cost reduction
in logistics achieved by a review of packaging specifications,a reduction in the amount of resin used, and downsizedpacking. The reduced amount of waste disposal cost was
attributed to waste reduction while the decreased water andsewerage bills resulted from reduced water usage. We were
not able to reduce costs by energy saving.

protection measures

Year-on-Year Reduction(Millions of yen)

Decline in cost due to energy conservation
Decline in cost due to natural resources
conservation

285

Reduction in water and sewerage cost

26

Reduction in waste disposal cost*3* Figure includes the sales of valuable resources

Assessing Environmental Impact Using LIME*1
Every year, Lion calculates its eco-efficiency using the following
formula to assess the efficiency of corporate activities interms of environmental impact. The Company then works to
improve efficiency in light of the result.

Eco-efficiency =Results of business activities (net sales)
Environmental impact(Level of environmental
impact calculated using LIME)

The level of environmental impact was calculated using
LIME, which provides a single indexed model for the degreeof environmental impact associated with environmentalload substances and resource consumption, including CO2,
NOx, SOx, harmful chemical substances, waste, and energy
consumption, with due consideration for weighting thevarious impacts and load substances. Calculations involving
substances for which LIME does not provide data are madeby analogy based on the energy and raw materials used to
produce them. The base year for the level of environmental
impact is 2000.
Environmental impact decreased from 2007 down to 71%
of the 2000 level as a result of factors including reduced CO2
emissions and atmospheric pollutants. Eco-efficiency basedon LIME therefore increased from 2007 levels as the results ofbusiness activities (sales) maintained their 2007 levels.
■ Trends in eco-efficiency and level of environmental impact(compared to 2000 levels)

Level of environmental impact

Eco-efficiency(%)

Eco-efficiency

Effects

Eco-efficiency

Level of environmental impact(compared to 2000 levels)■ Economic benefits associated with environmental

The Environment and Lion

effects) accompanying environmental protection: (1) Decline
in cost due to energy conservation; (2) Decline in cost due tonatural resources conservation; (3) Reduced cost of water andsewerage, and; (4) Reduced cost of waste disposal. Reductions
are calculated in comparison with the previous year.
Lion Corporation’s environmental accounting period is
the same as the Company’s financial year, January 2008 to
December 2008.

2004

2005

2006

2007

2008

*1 LIME (Life-cycled Impact Assessment Method) is a Japanese version of the damage-oriented impact assessment method developed by the “Development of Assessment Technology of Life Cycle
Environment Impacts of Products, etc.” (the “LCA Project”) of the Ministry of Economy, Trade and Industry (METI). LIME is used to calculate potential damage associated with each of about 1,000
substances in 11 areas, including global warming, ozone layer destruction, hazardous chemical substances and resource consumption. The resulting level of environmental impact is expressed inmonetary terms.

28

The Environment and LionECO LION Activities(Lion’s Environmental Protection Activities)
Lion pursues ECO LION activities based on five principal initiatives toward becoming a “leading company inenvironmental friendliness.” Lion is achieving sound results in implementing its plan toward achieving the goals of
the Three-Year Medium-Term Environmental Plan established in 2007.

ECO LION activities encompass all of Lion Corporation’s
business activities, from research and development, rawmaterials procurement, manufacturing at plants, marketing,logistics, and sales, to household use and disposal.
In response to the Eco First Program being promoted by the
Ministry of the Environment, Lion announced its medium- tolong-term environmental protection goals as Lion’s Eco First
Commitment, which emphasizes efforts to prevent global
warming through business activities and products. As a result,Lion became the first manufacturer to receive the “Eco First
Company” certification from the Ministry of the Environment.

Ceremony of Eco First Commitment(June 24, 2008)

ECO LION Activities’ Five Initiatives

1

Reducing Greenhouse Gas Emissions
Lion is undertaking activities to reduce total CO2 emissions, including emissions
from its business activities and those attributed to the use of its products byconsumers.

2

Effectively Using and Recycling Resources

3

Considering the Environment from a Product-Oriented
Perspective

Lion strives to reduce total waste generation and final waste landfill volume while
establishing a waste recycling control system.

Lion is promoting the development of eco products through the utilization of Lion Eco
Standards, established in 2006 from the perspective of LCA*1, which quantitatively measuresenvironmental impact from material procurement to product disposal.

4
5*1 LCA: Life Cycle Assessment

29

Appropriately Handling Chemical Substances
Thoroughly complying with various relevant regulations regarding safety assurance andenvironmental consciousness, Lion pays close attention to safety and the environment at every
stage of product life, striving for thorough control of chemical substances and reduction of their use.

Fostering Environmental Awareness within the Lion Group
Aiming to become a “leading company in environmental friendliness,” Lion is implementing
environmental education on a continual basis to raise each employee’s awareness of environmental
issues.

Anticipating a post-Kyoto Protocol framework, Lion is reducing CO2 emissions from its business activities as well as
those attributed to the use of its products by consumers to prevent global warming.

In 2005, the Kyoto Protocol came into effect, calling for Japanto reduce its greenhouse gas emissions by 6%, compared to1990 levels, between 2008 and 2012. It is believed that a 50%
reduction in worldwide CO2 emissions will be necessary by
2050. In this context, Lion Corporation is preparing for a postKyoto Protocol framework by having all employees actively
strive to reduce CO2 emissions.
In 2008, the Lion Group successfully reduced its CO 2
emissions by 38% from the 1990 level. This included emissions
related to business activities and those attributed to the use of
its products by consumers.
■ Total CO2 emissions from the Lion Group’s businessactivities and the use of its products(Tons)

Product-derived CO2Business activities-derived CO2

reduction

Reducing CO2 Emissions Associated with Business
Activities by 17% (from the 1990 level)
As part of its efforts to reduce CO 2 emissions in 2008, theProduction Division implemented energy conservation
measures such as improving the production process for
powdered laundry detergent. Among its activities for reducing
CO2 emissions, Lion Corporation participated in Japan’s Team
Minus 6% project at its offices and R&D division, thoroughly
promoted the “eco-drive” effort for commercial vehicles,
switched to low-emission vehicles, and reduced the numberof its vehicles.
As a result, CO2 emissions in 2008 were reduced by 17%
compared to the 1990 level, making it possible for Lion toachieve emission targets for 2008 that are at least 86% of
the 1990 level formulated in the Three-Year Medium-Term
Environmental Plan (a reduction of at least 14%).

The Environment and Lion

1

Reducing Greenhouse Gas
Emissions■ Business activities-derived CO2(Tons)

Utilizing Plant-based Materials to Reduce CO2Emissions Attributed to the Use of Products by
Consumers
Lion Corporation is conducting product research anddevelopment toward reducing CO2 emissions from products
after household use.
These efforts specifically involve advancing the conversion
from surfactants made from petroleum-based ingredients toplant-based surfactants that do not lead to increasing CO2 (thatis, carbon neutral; see p. 35), as efforts to reduce CO2 emissions
associated with products.
In 2008, the Company implemented measures such as apartial conversion from synthetic to plant-based alcohol but
was not able to increase the use of plant-based materials asplanned due to the increased use of petrochemical materials
as a result of a change in the product sales ratios. Goingforward, Lion will continue to achieve higher goals by further
increasing the use of plant-based surfactants.
The Greenhouse Gas Inventory of the Ministry of theEnvironment calculates CO 2 generated through thebiodegradation of petrochemical surfactant after use, which
confirms the importance of the Company’s efforts to reduce
CO2 emissions from products after use.
■ Product-derived CO2(Tons)

30

The Environment and Lion

Global Warming Countermeasuresin Logistics

Environmental Activities at Lion Offices
All employees are promoting ECO LION efforts to establish
Lion as a leading company in environmental friendliness.
As part of these efforts, Lion participated in the Team Minus
6% project in July 2005, a government-promoted national
movement to prevent global warming. To that end, Lion is
implementing the following four measures.
1. Appropriate temperature settings for air conditioning(summer: 28°C; winter: 20°C)
2. Adopting a system that allows all employees to leave ontime once a week to reduce electricity usage
3. Prac ticing thorough energy-saving measures byswitching off unnecessary lighting during lunchtime aswell as in unattended restrooms and other areas
4. Promoting eco-driving with its company vehicles

We have long worked to enhance the efficiency of logistics
operations in cooperation with affiliated companies that
handle logistics within the Lion Group. We are also pursuing
joint logistics with other manufacturers. CO 2 emissions in2008 stood at 98.5% of the previous year as a result of efforts
that included reducing the amount of fuel used in logistics by
expanding direct shipments from factories and bypassing the
distribution center and also by improving shipment load ratios.
Having acquired in 2005 the Eco Rail Mark certified by the
Ministry of Land, Infrastructure and Transport, the Company
is pursuing a modal shift in its logistics system by switching
to railways and ships. The modal shift rate for long-distancetransport over 500 km has now exceeded 50%, and a similar
shift is also underway for middle-distance transport. The modal
shift rate for total traffic volume improved to 22.9%.
Energy consumption per unit of specific productivity in
2008, however, rose to 104% over the previous year as thetransport of stored products increased due to the change
in production sites. Lion will further promote rational useof energy as a specified shipper defined in the revised Law
concerning the Rational Use of Energy.
■ Modal shift rate(%)

We are also striving to reduce CO2 emissions through othermeasures that include power-saving initiatives independently
developed and implemented by individual business sites. In
addition, the sales departments are vigorously working on
actions for reducing CO2 emissions, such as the use of lowemission vehicles as company cars, reducing the number ofvehicles and encouraging car sharing initiatives.
As a result of these efforts, Lion Group offices reduced CO2
emissions by 77 tons from the previous year between April
2008 and March 2009.

Reducing CO2 Emissions by
Car Sharing for Promotional
Activities■ The Lion Group’s total CO2 emissions at its offices

FY 2004 to FY 2008
(Tons)

April–September

October–March

Nobuyuki Shikata

General Affairs Department

We typically assign one vehicle to each sales person;
some sales activities, however, may be conducted
more efficiently using public transpor tation.
Therefore, we initiated car sharing and using vehicles
less frequently in the Tokyo area while avoiding any
potential interference with the effectiveness of sales
activities. As a result, we were able to reduce thenumber of vehicles used for promotional activities
in the Tokyo area by about 15%. Looking ahead, we
will continue to find ways of reducing CO2 emissions
from vehicles.
(FY)

31

In accordance with the philosophy of the Basic Law for Establishing the Recycling-based Society, Lion is facilitating
waste reduction and recycling, bringing significant results. Lion has achieved substantial reductions in both total
waste generation and final waste landfill volume compared to the 1990 level.

Lion Group’s Total Waste Generation
In 2008, the Production Division strived to reduce waste
acids by improving exhaust-gas treatment equipment andturning discarded flexible containers into valuable materials.
The Division also implemented other actions on an ongoingbasis, including efforts to reduce packaging materials loss
by stabilizing manufacturing processes. The Research andDevelopment Division sought to turn waste into valuable
materials through thorough sorting processes. Consequently,
total waste generation was reduced by 49% from the 1990
level, achieving the target for 2008. In 2009, Lion will pursue a
reduction of 50% or more compared to the 1990 level.

■ Lion Group’s total waste generation(Tons)

Lion

The Environment and Lion

2

Effectively Using and Recycling
Resources

Affiliated companies

Lion Group’s Final Waste Landfill Volume
Lion has already attained its target for final waste landfill
volume*1 (at least 14% below the 1990 level by 2010) set by
Nippon Keidanren. Lion is bolstering its efforts to achieve a
reduction of 90% or more from the 1990 level in 2009. Lion
achieved zero emissions*2 in 2002 at its production facilities
and has remained at that level. Among the Group affiliatedcompanies, Lion Chemical Co., Ltd. achieved zero emissions in2008. Looking ahead, the entire Lion Group will work towardachieving zero emissions.
Fur thermore, regarding waste disposal, super visors
responsible for overseeing waste generation at each site selectand commission waste disposal contractors in accordancewith the standards for selecting the primar y trustees
outsourced following waste management regulations. Lionalso implements regular on-site inspections of waste disposal
contractor operations and verifies that contractors arecomplying with these regulations.

Water Resources Preservation

Lion

Affiliated companies

2010 Target in Keidanren
Voluntary Action Plan

* Excluding construction waste for 2007 and earlier■ Lion Group’s water consumption, wastewater discharge

and COD(1,000 m3)

Water consumption
Wastewater discharge

COD (Tons)

COD

Green Purchases(Tons)

Water consumption/wastewater discharge

While continuing its efforts to control water consumption
and wastewater discharge, Lion endeavors to reduce impact
on the water environment. In particular, it engages in theconservation of water resources through the maintenance andstabilization of wastewater processing facilities on a regularbasis. In 2008, the COD *3 increased from the previous year inspite of such efforts as efficient water-cleaning operations at
its production facilities.

■ Lion Group’s final waste landfill volume

Lion is encouraging companywide green purchasing of officesupplies used by employees. The ratio of green purchases ofoffice supplies in 2008 was 66%. This was a result of a review
of our green purchase standards in response to the revelation
inearly 2008 that the ratio of recycled pulp in the paper
manufacturing industry had been misrepresented.
*1 Final waste landfill volume: The final volume of waste not reused as a resource*2 Lion’s definition of zero emissions: A 99% or better proportion of total waste products emitted that are reused as resources; this does not include the residue from such reuse*3 COD: Chemical oxygen demand; an index of water pollution that indicates the amount of oxygen consumed in order to oxidize and break down organic substances in water

32

The Environment and Lion

3

Considering the Environment froma Product-Oriented Perspective

Lion promotes the development of eco products by establishing Lion Eco Standards from the perspective of Life
Cycle Assessment (LCA), which quantitatively assesses the environmental impact of products, from raw materials
procurement to disposal.

Evaluation Items and Criteria in the Lion Eco Standards

Product Development Activities that
Consider the Environment
Lion product development activities consider the environment
in terms of product composition (content) as well as containers
and packaging.
Environmental impact is quantitatively evaluated utilizing
Lion Eco Standards for each stage of a product’s life cycle:(1) raw materials procurement; (2) packaging materials
procurement; (3) manufacturing; (4) logistics; (5) household
use and; (6) disposal. Products that meet at least one criterionof the Lion Eco Standards are designated as Eco Products.
To realize a sustainable, recycling-oriented society, it
is necessar y to recognize the value of petroleum andother limited resources, which in turn requires reducing
environmental impact at every stage of a product’s life cycle.
In this context, Lion will continue to proactively develop
products that take the environment into consideration.

Evaluation items and criteria in the Lion Eco Standards aredescribed below.
Lion did not include specific criteria for eliminating harmful
chemical content or incorporating outstanding biodegradable
properties among the evaluation items in the Lion Eco
Standards since these aspects are already considered to beabsolutely essential for the Company’s products.
■ Ratio of eco products to the total number of Lion products
0

50

100

Products that meet at least one criterion of
the Lion Eco Standards

Stage

Evaluation item

Evaluation criteria

1 Raw materials

Use of plant-based materials● The ratio of plant-based materials to organic composition in products should be over 50%

Packaging
2 materials
procurement

Use of recycled materials
Use of plant-based andbiodegradable materialsof recycled paper, thinned wood or certified forest pulp should be over 94% of 2010
target established by the Ministry of Economy, Trade and Industry and the paper
manufacturing industry)● Materials should use plant-based or biodegradable resins

3 Manufacturing

Energy conservation
Decreased generation of waste● Either energy consumption or waste volume should be reduced by more than 20%

4 Logistics

Energy conservation due tosmaller-sized containers andmore concentrated content

5 Household
use

Reduction of usage volume
Energy conservation
Water conservation

procurement● Materials (paper and plastic) should be recycled materials (for paperboard, the ratio

compared with the conventional manufacturing method● Both containers and contents should be over 20% smaller or more concentrated thanexisting products● Organic loading generated through use of the product should be 20% or less33

products● Save 20% or more water in product use▼
6 Disposal

compared to existing products● Energy consumption in product use should be 20% or less compared to existing

Reduction of container andpackaging materials
Reduction of waste by meansof refillable containers● Materials used for containers and packaging should be reduced 15% or more than forexisting products● Materials used for pouch and refill packages should be less than 50% of the originalcontainers’ weightReducing the Amount of Organic Matter per LoadE xcessive organic mat ter
discharged into an aquatic
environment requires moretime to biodegrade due tothe additional strain on theenvironment. The amount ofdischarged organic mattercan be reduced by using
highly efficient content that
requires less per use, thus
decreasing the environmental
impact. Products designated as Eco Products under the Lion
Eco Standards reduce the discharge of organic matter by atleast 20% compared with conventional products.

In accordance with its own Three Principles of Environmentally
Responsible Formulation Development, the Company ispursuing product formulation (content) development that
protects the aquatic environment and prevents global
warming. For environmentally responsible formulation
development, relevant evaluation items have been establishedfor each stage of (1) raw materials procurement, and (5)household use under the Lion Eco Standards.

Product Formulation Development

Activity 2

Activity 1

Use of Plant-based Materials
Surfactants used in detergents and other products, which arereleased in the environment after use, biodegrade*1 into CO2
and water. Surfactants made of carbon neutral plant-basedmaterial, however, do not increase the total volume of CO2 in
the atmosphere. In addition, plants are renewable resourcesthat can be cultivated. Conserving natural resources is also anenvironmental consideration.
Under the Lion Eco Standards, plant-based ingredients must comprise atleast 50% of the organicm at te r co nt a i n e d i n
products designated as
Eco Products.

Product Formulation Development

The Environment and Lion

Product Formulation Development

Environmentally Responsible Formulation
Development

Activity 3

Use of Biodegradable Surfactants
Sur f a c t ant s us e d in Lion
products biodegrade quickly
after use and do not remainin the environment for long
periods.

* See p. 35 for a more detailed
explanation of the features of theplant-based surfactant methyl ester
sulfonate, MES, developed by Lion.

History of Lion’s Efforts to Protect Aquatic Environments
1960s

1970s

Since 1980s

Problem of foaming rivers

Eutrophication phenomenon

Global environmental problems

Rivers were covered with foam due to thelow biodegradability of the surfactant
ABS that was used in synthetic detergentsat the time.

Eutrophication is associated with problems
such as red tide. One cause of red tide isphosphorus, used at the time for laundry
detergent to increase detergency.

Environmental issues at a global scalesurfaced, requiring due consideration forresource preservation and environmental
impact.

▼Lion switched detergent material toeasily degradable LAS. The Company
then developed highly biodegradable
AOS (alpha olefin sulfonate) in 1967 andlaunched “Dash,” the world’s first AOSbased laundry detergent.

▼

Lion conducted research on phosphatefree detergents and launched “Seseragi,” thefirst phosphate-free detergent in 1973. In
1980, the Company launched “Phosphatefree TOP,” which has a substantially higher
detergency because it contains zeolite.

▼

In 19 8 8 , L io n laun ch e d High TO P, acompact laundr y detergent featuring
a high cleansing ef fect using smaller
amounts. And then in 1991, the Company
developed “Spark” laundry detergent using
MES processed from coconut and palm oil.

*1 Biodegradation: the decomposition by microorganisms of organic matter emitted into the environment into carbon dioxide, water and inorganic substances, or the ingestion of this matter by livingorganisms

34

The Environment and Lion

2. Superior Biodegradability
Surfactants discharged into the environment after use aredecomposed (biodegraded) into CO 2 , water and otherinorganic substances by microorganisms. MES biodegrades
easily and does not remain in the environment for a long time.

Considering the Environment
by Using MES

Superior Properties of MES
1. Carbon Neutral
Surfactants contain carbon (C). After use, surfactants arebiodegraded in the environment into carbon dioxide (CO2)and water.
Both plant- and petroleum-based laundry detergents
contain carbon and therefore biodegrade in the same manner,
releasing CO2 emissions. Although plant-based surfactants
emit CO2 as they biodegrade, there is no increase in the total
volume of CO2 released into the atmosphere because plants
absorb CO2 and solar energy as they grow and therefore theiruse is carbon neutral.
This means that plant-based detergent MES does not add tothe total amount of CO2 in the atmosphere despite releasing
CO2 as it decomposes after use.

CO2

O2

Days elapsed MBAS (Methylene blue active substance) Indicator* Source: Journal of the Japan Oil Chemists Science, Vol. 42, No. 9, pp. 643–648 (1993).

3. High Detergency
A smaller amount of detergents that feature high detergency
are required per load of laundry, making it possible to reduce
the amount of organic matter released, thereby reducing theoverall load on the aquatic environment. The present version
of TOP laundry detergent is blended with high detergency
MES and releases only 5.2 g of organic substances per load oflaundry.

Released into theatmosphere,
increasing CO2
Vegetable oil

Laundry
Plant-based Detergents
ingredientsPetroleumbased
ingredients Surfactants

CO2
Biodegradation
H2O

Crude oilAmount of detergent per loadof laundry (g/30L of water)

Organic matter (g)Photosynthesis

MES
LAS*1
Soap
ABS*2 (Reference value)■ Amount of organic matter released per load of laundry■ Carbon neutral

Carbonfixation■ Biodegradation of surfactants

Persistence of surfactant (%)

Lion was the first in the world to succeed in the industrial
production of MES, a plant-based surfactant with superior
detergenc y and biodegradabilit y. MES is used in the
Company’s laundry detergents such as TOP. Lion is now
working toward establishing MES as the global standard forwashing components (see p. 3).

Powdered
Phosphate-freelaundry detergents TOP (1980)(Year of launch)

High TOP(1988)TOP(Current)

MES also exhibits other superior properties, including highdetergency in hard water and compatibility with enzymes thatbreak down grime.

Carbon fixation

Comparison of CO2 Emission with Laundry Detergents Using LCA
TOP, which was released into the market in
March 2009 with a higher MES ratio, can cut
CO2 emission per use by 51% compared with
CO2 emissions produced by the petroleumbased High TOP laundry detergent introduced
in 1990 (figures calculated by means of LCA).

High TOP of the 1990s(principal washingcomponent is petroleum-based)
Current TOP(principal washingcomponent is plant-based)

Raw material procurement/manufacturing
Transportation
Biodegradation after use

51% reduction
CO2 Emissions per load of laundry (value indexed to 100 for 1990)*1 LAS: Readily biodegradable surfactant linear alkylbenzene sulfonate*2 ABS: Branched alkylbenzene sulfonate; a surfactant that is highly resistant to biodegradation

35

The Chemical Division’s Environmental Solutions
Business
In addition to its healthcare and household produc t
businesses, Lion has the Chemicals Division, which provides
industrial chemicals to each industry.
Given the increasing social demand in recent years forenvironmental-friendliness among customers of the Chemicals
Division, Lion Corporation has been striving to meet thisdemand by developing a wide range of products that
reduce environmental impact, thus supporting a sustainable,
recycling-oriented society in areas not readily visible to the
public.

Plant-Based Chemical Products
Today, the majority of chemical products are made frompetroleum. However, Lion is aggressively developing
environmentally friendly industrial products by leveraging
plant-based materials such as coconut oil and palm oil. Someof these products are raw materials used for ink solvents andas oil-spill dispersants.
Lion has successfully developed plant-based, highperformance electrical insulating oil (palm fatty esters) usedin substation transformers. Lion obtained the environmental
label “Eco Mark” in 2008 for this transformer oil because of its
high biodegradability.
■ Plant-derived raw materials

Industrial Aqueous Detergents with Less
Environmental Impact
Information/electronic hardware has become remarkably
sophisticated in recent years. To complete the manufactureof component parts, a number of cleaning processes arenecessary, each requiring superior detergency. On the other
hand, demand is strong for environmentally friendly washingcomponents in place of detergents that contain ozonelayer-destroying fluorocarbons and chlorinated solvents.
Given this trend, Lion utilizes its proprietary microemulsion
technology to develop and offer aqueous detergents that
contain absolutely no petroleum solvents. Because their basecomponent is water, these detergents are environmentallyfriendly and safe for people to use. They are presently usedin the manufacturing process for such items as optical lenses
and liquid crystal displays. Lion’s products also support theenvironmental measures being undertaken by automobile
manufacturers as well as electronics makers.
■ Aqueous detergent’s cleaning effect▶

▶
Palm fruit

To manufacture recycled paper from old newspapers andmagazines, ink on the used paper must be removed first. This
process is called “de-inking.” Referred to as recycled paper
cleaning, this technology is one of Lion’s strong points.
Consequently, Lion has been extensively providing deinking agents used in this process to paper manufacturers andhas supported domestic paper-recycling manufactures forover 30 years. The Company now markets de-inking agents in
Europe, the United States and the rest of Asia.

The Environment and Lion

Environmental Care in the Chemicals
Division Business

De-Inking Agent, Essential to Paper Recycling

Eco Mark No.
07110003

Insulating oil with low
viscosity and high insulation
properties

Presently, transformer oil uses petroleum-based oils, of whichapproximately one million kilolitres is produced worldwide
each year. However, thisoil releases approximately
2.5 million tons of CO 2
when it is burned. Lion iscontributing to the curbingof CO2 emission increases
in the atmosphere byswitching to renewable
and carbon-neutral, plantbased oils.

Lenses prior towashing

Lenses after
washing

Enlarged lens surface

Enlarged lens surface

Aside from the products already mentioned, Lion markets
sophisticated industrial chemicals in Japan and overseas thatare playing a key role in environmental protection on a global
scale.

High-capacity transformer

36

The Environment and Lion

ReduceThe “3Rs” of Containers and Packaging
Reduction

Reducing Usage Volume

Making Products Compact and Improving
Container Design

Lion is actively promoting the “3Rs” (Reduce, Reuse, Recycle)
as an initiative to reduce containers and packaging materials.
In addition, to achieve the Japan Soap and Detergent
Association’s 2010 target of reducing packaging materials
to 70% or less (compared with the 1995 level) in 2009, in
accordance with its voluntary action plan, Lion is undertaking
a wide range of efforts to reduce containers and packaging
materials.
Items * 1 to evaluate the reduction of containers andpackaging materials are defined for the related stages of (2)packaging material procurement, (4) logistics and (6) disposal,of the Lion Eco Standards (see p. 33).
■ The “3Rs” of containers and packaging reduction

ReduceLion is promoting the development of a more compact
product package to reduce containers and packaging
materials by achieving higher performance laundry anddishwashing detergents, fabric softeners and other productsthat are at higher concentrations.
In 2008, the amount of containers and packaging materials
used stood at 67,720 tons. The overall volume decreased by
2,492 tons from 2007 as a result of decreases in cardboard,paperboard and metals despite using more glass and plastic.
The volume of plastic used in eight categories of home
products as defined by the Japan Soap and Detergent
Association was 71% of the 1995 level.
Lion will remain committed to reducing the amount ofcontainers and packaging materials used by developing morecompact products and innovative container designs.
■ Specifically designed containers

Reducing usage volume
Reduce the quantity and sizeof containers and packaging

Reuse

Reusing containers andpackaging
Increasing the number of refill
products

Conserving resources
Promoting the use of recycledmaterials■ The volume of containers and packaging materials used
(Tons) Total

Cardboard

Paperboard

Reduced 14%of plastic use▶
Reduced 20%of plastic use

RecyclePlastic

Containers that are easy tohold even without a handle

Glass

Metal

Plastic use is reduced bychanging from triple todouble-layer film

Integrating Environmental
Considerations with Quality
and Usability
Takashi Sakaguchi

Packaging Engineering Research Laboratories
Research and Development Headquarters

We implement the “3Rs” for containers and packaging
materials with a special focus on using less packaging
material (Reduce) and utilizing recycled materials(Recycle). In the course of developing products withthese goals, we also ensure quality and conveniencein such factors as usability from the consumer’s
perspective. We want to advance efforts for theenvironment together with customers who use Lion
products.

*1 Evaluation standards for each stage: (2) Packaging material procurement: Use of recycled materials(4) Logistics: Compactness and concentration of products(6) Disposal: Reduction of containers and packaging materials, and reduction of packaging materials through the use of refillable containers

37Reusing Containers and Packaging

Increasing the Number of Refill Products

RecycleConserving Resources

Promoting the Use of Recycled Materials

Plastic bottles for dishwashing detergent, shampoo andother products can be refilled and used repeatedly. And theuse of refill products requires less material for manufacturingcontainers, thereby helping to reduce household trash.
Lion has been working to increase the number of refill
products since 1992. Refill products are now available for awide array of products, including shampoo and fabric softener.
For spray-type products, refillable containers are available aswell as containers without the spray trigger. Lion is exploring
container shapes and other innovations for refill productsthat are easier for customers to use. We will expand our rangeof refill products while at the same time striving to further
improve the design of containers toward making them simpler
to manage for customers.

Utilizing Recycled Plastic
Lion jointly developed with container manufacturers atechnology for using reprocessed PET resin. In 1989, Lion
launched Mama Pockety, the first dishwashing detergent inJapan to make use of reprocessed PET resin for its container.
The Company subsequently developed a technology forsolving the longstanding challenge of using reprocessed PET
resin for transparent bottles.
Containers for the Lion dishwashing detergents Charmy
Awa no Chikara (Power of Suds), Charmy V Quick and Charmy
Mild are composed of at least 20% reprocessed PET resin fromplastic beverage bottles. And measuring spoons for powderedlaundry detergents use reprocessed resin from discarded
home appliances such as washing machines.

The Environment and Lion

Reuse

■ Innovative refill products and waste reduction effect● Easy-to-open perforation● Easy-to-refill extended pour spout

Comparison ofcontainers▶

● Product

identification
slit for thevisually
impaired99%
reduction involume79%
reduction inweight● Easy to carryand stably
stands upright

Refill product■ Refill product sales ratio for Lion’s mainstay productcategories

(%)

2004

2005

Shampoo
Dishwashingand Conditioners detergents

2006

2007

Liquid laundry
detergents

2008

Utilizing Recycled Paper Blended with Recycled Pulp
Containers and packaging material for such products as
toothpaste and laundry detergent use white paperboard
blended with recycled pulp. Labeling on powdered laundry
detergent containers clearly states the ratio of recycled paper
is at least 70%.
In addition, the composition ratio of recycled pulp fortransportation cardboard is 94%.

Fabricsofteners

38

The Environment and Lion

4

Handling Chemical Substances
Appropriately

Lion pays full attention to safety and the environment and strives to thoroughly control and reduce chemical substancesin the entire process, from product development to household use and disposal.
In addition, Lion verifies on an independent basis what impact MES—Lion’s proprietary surfactant—has on aquatic environments.

Safe Handling of Chemical Substances
Chemical substances are necessary in helping to make ourlifestyle congenial and comfortable. However, if appropriate

controls are neglected, or if an accident were to occur, there
could be significant impact on people’s health and theentire ecosystem. As well as complying with related laws
and regulations, Lion makes every effort to control chemical
substances at every stage, from product development tohousehold use and disposal.

■ Control of chemical substances at Lion

1 Product Development

2 Production

3 Transport

Managing and confirming the safetyof chemical substances in raw materials

Identifying and reducing
chemical substance emissions

Providing information on the safety andproper handling of chemical products

Product Development
Management of Chemical Substances in Lion Products
Chemical substances in Lion’s products are administeredunder prevailing laws and regulations as well as the Company’s
proprietary criteria, starting from the process of raw material
procurement.
Confirmation of Chemical Substance Safety
Lion participated in the OECD/HPV Program’s*1 international
consortium and cooperated in safety confirmation work forlinear alkylbenzene sulfonate (LAS), fatty-acid methyl ester(ME) and α-olefin sulfonate (AOS). In addition, Lion committed
itself as a sponsor of MES in the Japan Challenge Program*2
and carried out safety confirmation work in cooperation with
the Japanese government. The Company compiled MES
safety information in May 2009 and completed a report for
the Japanese government. The Company also participates in
the activities of the “Joint Article Management Promotionconsortium (JAMP),”*3 and is developing mechanisms to
manage chemical substances and disseminate information toits supply chains.

4 Household Use and Disposal

enforcement in April 2010.
Hereafter, Lion will take measures to reduce emissions at
production facilities.
Voluntary Activities for Air Pollution Prevention
Lion is conducting voluntary activities to reduce chemical
substances such as nitrogen oxide (NOx), sulfur oxide (SOx),
and particulate and volatile organic compounds (VOC) thatcause air pollution. Lion reduced VOC emissions in 2008 by
62% compared to the 2000 level and has already achieved thetarget of 40% or more reduction of these emissions.
■ Trends of NOx, SOx, and particulate emissions (Lion Group)(Tons)NOx

SOx

Particulate

Production
Complying with the PRTR Law*4
The Production Division and the Research and Development
Division submit reports regarding the emissions and transportvolume of chemical substances covered under the PRTR Law
on a yearly basis. During fiscal 2008, reports were submitted
related to the emissions and transport volume of 37 materials.
The Company is preparing for full compliance with the
PRTR Law as revised in November 2008 and scheduled forTransport
Providing Safety Information during Transport
Lion distributes and attaches Yellow Cards and Container
Yellow Cards* 5 that provide emergency information for
personnel engaged in the transport of raw materials andsemimanufactured products.

*1 OECD/HPV Program: An approach for establishing a database and disclosing the results of environmental and health impact from High Production Volume (HPV) chemicals (produced inquantities over 1,000 tons per year) conducted by the Organization for Economic Co-operation and Development (OECD)*2 Japan Challenge Program: A program for linking industry and the Japanese government, accelerating the collection of safety information regarding existing chemical substances anddistributing this information to a wide range of citizens

39ecological risk assessments of public water sources. The JSDA
conducts these assessments four times annually and reports
on river water concentrations of four types of surfactants
found in water discharged from households. *6 With regard
to the surfactant MES, Lion independently conducts similarassessments. These surveys have confirmed a negligible
impact on the ecosystem.

Ecological Risk Assessment of Chemical Substances Includedin Products Discharged after Household Use
Surfactants that are contained in products are discharged into
the environment after household use.
Every year, the Japan Soap and Detergent Association(JSDA), with which the Lion Corporation is affiliated, conducts

The Environment and LionHousehold Use and Disposal■ Control of chemical substances at Lion
Amount released (kg/year)

Substance
numberspecifiedbythe law

Substance nameAtmosphere2007

Amount transferred (kg/year)

Public water systems

2008

2007

2008

Sewage

2007

Waste

2008

2007

2008

1 zinc compounds (water-soluble)

0.0

0.0

0.0

0.0

2.0

1.5

23

17

3 acrylic acid

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

4 ethyl acrylate

0.0

0.0

0.0

0.0

0.0

0.0

1,100

780

6 methyl acrylate

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

12 acetonitrile

25

22

0.0

0.0

0.0

0.0

20,00016,000

16 2-aminoethanol

0.0

0.0

0.0

0.0

3.8

1.1

44

12

17 N-(2-aminoethyl)-1,2-ethanediamine; diethylenetriamine

0.0

0.0

0.0

0.0

0.0

0.0

0.0

8.1

22 allyl alcohol

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

24 n-alkylbenzenesulfonic acid and its salts (alkyl C=10-14)

420

220

0.0

0.0

58

140

46,00043,00042 ethylene oxide

120

110

0.0

0.0

0.0

0.0

0.0

0.0

43 ethylene glycol

0.0

0.0

0.0

0.0

0.0

0.0

1,500

200

45 ethylene glycol monomethyl ether

380

0.0

0.0

0.0

2.6

0.6

29

6.6

46 ethylenediamine

0.0

0.0

0.0

0.0

53

11

610

130

47 ethylenediaminetetraacetic acid

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

54 epichlorohydrin

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

56 1,2-epoxypropane; propylene oxide

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

63 xylene

1.3

1.1

0.0

0.0

0.0

0.0

42

38

65 glyoxal

0.0

0.0

0.0

0.0

0.0

0.0

1,800

1,100
0.0

96 chloromethane; methyl chloride

370

520

0.0

0.0

0.0

0.0

0.0

134 1,3-dichloro-2-propanol

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

166 N,N-dimethyldodecylamine N-oxide

0.0

0.0

0.0

0.0

0.0

0.0

0.0

200

177 styrene

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

O,O-dimethyl O-3-methyl-4-(methylthio)phenyl193
phosphorothioate; fenthion; MPP

0.0

0.0

0.0

0.0

0.0

0.0

8.4

0.1

227 toluene

540

440

0.0

0.0

0.0

0.0

5,700

8,500

231 nickel

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

232 nickel compounds

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

251 bis(hydrogenated tallow)dimethylammonium chloride

0.0

0.0

0.0

0.0

0.0

0.0

0.0

540

3-phenoxybenzyl 3-(2,2-dichlorovinyl)-2,2dimethylcyclopropanecarboxylate; permethrin

0.4

1.3

0.0

0.0

0.0

0.0

210

190

283 hydrogen fluoride and its water-soluble salts

0.0

0.0

0.0

0.0

4.7

4.4

6.9

6.5

297 benzyl chloride

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

304 boron and its compounds

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

307 poly(oxyethylene) alkyl ether (alkyl C=12-15)

0.0

0.0

0.0

0.0

7,300

8,500

190,000

210,000

310 formaldehyde

0.0

0.0

0.0

0.0

0.0

0.0

1,900

0.0

313 maleic anhydride

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

314 methacrylic acid

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

320 methyl methacrylate

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

4.4 mg-TEQ

2.7mg-TEQ

0.0mg-TEQ

0.0mg-TEQ

0.0mg-TEQ

0.0mg-TEQ

130mg-TEQ

130mg-TEQ

267

179 dioxins

Notes:• None of the above were discharged into soil or disposed to landfill.
• For more details on the emissions and transport of chemical substances, visit: HP http:www.lion.co.jp/ja/csr/env/report/ (in Japanese)*3 Joint Article Management Promotion-consortium (JAMP): Established to manage chemical substances within products and to disseminate specific mechanisms that facilitate disclosure/conveyance of such information along the supply chain*4 PRTR Law: The Pollutant Release and Transfer Register Law promotes steps for precisely understanding the emission volume of specific chemical substances in the environment as well as

management improvements for this purpose. The PRTR Law requires businesses that handle chemical substances that may cause harm to human health and ecosystems to independently
measure the volume of these substances discharged into the environment or transferred from businesses and to report this information to the Japanese government.

*5 Yellow Cards, Container Yellow Cards: A labeling system that provides information on the properties of chemical substances and emergency procedures in the event of a chemical leak

during transport*6 Related pages on the website of the Japan Soap and Detergent Association: HP http://jsda.org/w/01_katud/a_seminar012.html (in Japanese)40

The Environment and Lion

5

Fostering Environmental Awarenesswithin the Lion GroupTo further increase environmental awareness among all employees engaged in ECO LION activities and to encourage
voluntary environmental activities, Lion implements environmental education and provides opportunities to carryout these activities.

Implementing Periodic Environmental Education
Lion regularly conducts environmental education for all
employees to encourage voluntary environmental activities.
Lion conducted training programs in 2008 for new
employees as well as employees in charge of waste
management and those in charge of chemical substancemanagement. In terms of training for internal environmental
auditors, nine employees completed an external course in2008, bringing the total number of those who have obtained
certificates to 45. A total of 395 employees have completed inhouse courses. In addition, the Company is striving to increase
employee knowledge and awareness of environmental issues
by featuring the environmental activities of individual divisions
in an in-house magazine.

In the in-house magazine,
Lion features special topics
regarding environmental
preservation activities aiming
to enhance employees’
environmental awareness.

All Lion Employees Participate in Japan’s Team
Minus 6% Project
Since July 2005, all Lion employees have been participatingin the Team Minus 6% Project(see p. 31). In addition, Lion has
been supporting “My Challenge
Declaration” since 20 08 andcooperating with the “I declare
CO2 reduction of 1 kg 1 day 1 person” movement under the Ministryof the Environment.

Poster encouraging employee
participation in the project

Implementation of the ECO LION Proposal
Campaign
As part of ECO LION activities, Lion has been holding the ECO
LION Proposal Campaign since 2006 to invite submissions ofideas related to ecological themes from as wide a range of
employees as possible.
The total number of ideas posted in 2008 was 2,577. Lion willcontinue this campaign to enhance employees’ environmental
awareness.

Fostering Environmental Awareness throughSupport for Nature Conservation Activities
Lion began undertaking forest trimming support activities
in 2006 and opened the Lion Forest in Yamanashi as its
first project under the Company Forest Promotion Project
carried out by Yamanashi Prefecture. We recruit volunteers
from among our employees annually for this purpose. In
2008, this activity was held three times, with 76 employees
participating (see p. 6). In addition, individual business sites are
independently engaging in nature conservation activities intheir respective regions.

Biodiversity and Environmental
Communication Initiatives
Biodiversity Efforts
Lion is working to preserve biodiversity while at the sametime pursuing eco-friendly business activities.
Lion fosters nature conservation activities as a member of
the Nippon Keidanren Committee on Nature Conservation.
And since 2006, the Company has been taking part in
the Roundtable on Sustainable Palm Oil to ensure theresponsible procurement of palm oil (see p. 4). Furthermore,

41

Lion is promoting production activities in harmony withnature through activities such as raising Odawara killifish(an endangered species) and fireflies at its Odawara plantby taking advantage of its clean water resource. In terms ofprotecting the global environment, biodiversity initiatives
are as important as actions for preventing global warming.
Therefore, the Company will explore additional concrete
actions in the future.

Lion is developing dynamic communication activities
to enable the general public to better understand its
environmental preservation efforts.

Communication with Communities and Various
Organizations
Lion participates in the activities of the Japan Responsible
Care Council (JRCC), through which the chemical industry
strives to implement and improve environment and safetymeasures throughout the entire life cycle of chemical
substances, from development, production, distribution, use
and final consumption to disposal. In 2008, the Osaka and
Akashi plants participated in community dialogues as a partof JRCC activities. The Chiba Plant convenes its own dialogue
with community residents every year. In addition, Lion
highlighted its efforts by presenting the “Report on Lion’s CO2
reduction initiatives—CO2 emissions from a product-oriented
perspective” at the Responsible Care Report 2008 Debriefing
Session.

Participating in Environment-related Events
Lion participates in environment-related events in various
regions to provide information on its efforts, including ECO
LION activities, to as many people as possible. Following
its participation the previous year, the Company joined Eco
Products 2008 and set up a booth to show our activities. Eco
Products is one of Japan’s largest environmental exhibitions,
held at Tokyo Big Sight. Lion highlighted its efforts, including
utilization of plant-based materials and 3R initiatives, tointroduce its approach for taking the environment into
account from a product-oriented perspective as well as its
efforts to preserve aquatic environments. The Company has
also presented at other exhibitions, such as Eco Messe 2008
in Chiba and the Summit of World’s Sea Level Cities—Global
Environment Exhibition in Edogawa-ku, Tokyo.
Eco Products 2008
(December 11–13, 2008)

Summit of World’s Sea Level
Cities—Global Environment
Exhibition(December 15–17, 2008)

Participating in the Carbon Footprint*1 Trial

The Environment and Lion

Environmental Communication Activities

After joining in 2008 the Study Group for Developing andPromoting the Carbon Footprint System organized by
the Ministry of Economy, Trade and Industry (METI), Lion
explored the possibilities of visualizing CO2 emission volume
based on LCA toward realizing a low-carbon society. The
Company also took part in a market test carried out by thestudy group in addition toa presentation on “Dentar
Clear MAX” accompaniedwith a demonstration displayof CO2 emissions at the METI
booth in Eco Products 2008
from December 11 through 13.

Publishing Environmental Reports
Lion publishes the CSR Report every year to communicate
its environmental efforts. The Company also releases Site
Reports from individual business locations to disclose detailed
information on their environmental activities. Lion additionallycompiles a more compact Eco Leaflet to aid in the public
understanding of its environmental activities. This leaflet isattached to the end of the CSR Report and is also distributed
to visitors at exhibitions and company factory tours.

Disseminating Information on Environmental
Activities through Our Website
Lion provides detailed information on its ECO LION
environmental protection activities and environmentrelated reports (the CSR Report, Eco Leaflet and Site
Reports) on the CSR (Environment/Society) page of theCompany website. Lion is striving through these andother means to provide timely information to customers.
On the Lion Kids website, specially designed for children,
the Company provides environment-related information
in a manner that elementary school children can readily
understand.

▶ Lion Kids Home pageHP http://www.lion.co.jp/kids/*1 Carbon footprint refers to information provided on product labeling that displays CO2 emissions throughout a product’s life cycle, from raw material procurement, manufacturing,sales and use to disposal.

42

Cover
Painting by Mafune Shibusawa of Shizuoka Prefecture.
First prize winner of the My River Picture Contest (LION TOP Eco Project)

Lion Corporation
June 30, 2009
CSR Promotion Department
Contact point for questions regarding the report
CSR Promotion Department
Social Responsibility Promotion Team/ Environmental Conservation Office3-7, Honjo 1-chome, Sumida-ku, Tokyo 130-8644, Japan+81-3-3621-6611 Fax:+81-3-3621-6269
URL: http://www.lion.co.jp/en/
Release schedule for the next report: June 2010

レスポン シブル・ケア®

In order to achieve “a 6% reduction in greenhouse gas emission,”
which is goal of Kyoto Protocol, it is essential to realize “3.9% CO2
absorption” in forests in Japan. This annual report was printed utilizing red pine trees in “Lion Forest in Yamanashi” as papermaking stock,contributing to the increased CO2 absorption in forests in Japan.

SA-COC-1210