02

Section

ESG
Initiatives

47

Sustainability Initiatives

49

Environmental Initiatives

50

Social Initiatives

59

Governance Initiatives

69

Takuma CSR Report 2023

48

Section 02

Sustainability Initiatives
1

Governance and risk management and strategies

In order to realize sustained growth alongside our customers and society by implementing ESG management as set
forth in our long-term vision, the company approached the task of formulating the 13th medium-term management
plan by organizing various ESG issues from the dual standpoints of their importance for stakeholders on the one hand,
and their importance for the Group on the other. This process led to the identification of seven Key Issues (Materiality)that deserve to be given priority by the Group. We also addressed the Key Issues we identified through our business
For more information about those initiatives, please see P29-30
activities and formulated KPIs (financial targets).

Seven
Key Issues● Helping combat climate change● Pursuing partnerships and innovation● Promoting activities of human resources● Strengthening corporate governance

Policies and initiatives related to climate change: For more information about strategies and scenario analysis related to climate change, please see pages 50 to 52.
Policies and initiatives related to human capital: For more information about specific initiatives to enhance human capital, please see pages 63 to 66.

3

Indicators and targets

The following describes Takuma’s KPIs and progress towards them as of the end of FY2022.

Materiality
Helping combat
climate change

KPI①CO2 emission reduction targets throughour own products and services

Magnitude of potential reduction in CO2 emissions
due to newly delivered power plants*
・FY2023: 800,000 tons per year
・FY2030: 2.5 million tons per year
*Biomass and Energy from Waste plants delivered fromFY2021 through FY2030.

②In-house CO2 emissions reduction targets(*1 through *4)

・FY2023: Effectively zero CO2 emissions

Progress (as of the end of FY2022)①CO2 emission reduction targets throughour own products and services
FY2022: 184,000 tons per year

*Calculated based on available generating capacity(renewable energy) as of one month after delivery forplants delivered in FY2021 and FY2022 (four waste
treatment plants, one sewage sludge plant, and 10
biomass plants).

②In-house CO2 emissions reduction targets
FY2022: 356 tons per year
(down 1,616 tons from FY2021)

by the Takuma Head Office and the Harima Factory(Scope 1 and Scope 2)・FY2030: Effectively zero CO2 emissions

by all Takuma worksites in Japan (Head Offices, branch offices,
factories, and construction sites) (Scope 1 and Scope 2)①Number of female employees brought
into the main career trackand management positions
35 or more (cumulative total for FY2021 to FY2025)②Percent utilization ofparenting support programs
25% or greater (average for FY2021 to FY2025)①Number of female employees brought
into the main career trackand management positions
16 (cumulative total for FY2021 to FY2022)②Percent utilization ofparenting support programs
35% (average for FY2021 to FY2022)

Ensuring safety
and health

Number of fatal accidents0

Number of fatal accidents (FY2022)
0Strengthening
corporate
governance

Number of serious compliance violations
0

Number of serious compliance violations (FY2022)
0

Promotingactivities ofhumanresources*1: The Scope 1 target includes offsets using environmental value such as J-credits. *2: The Scope 2 target is calculated using post-adjustment emission factors.
*3: FY2030 targets including group companies remain under consideration.
*4: CO 2 emissions from procured products and use of Takuma products by customers (Scope 3) also remain under consideration.

49

1

Basic approach

Vision 2030, our long-term vision for the Takuma Group 10 years in the future, includes this statement: “Aim to maintain ourrole of being an indispensable presence in society as a leading company in the field of renewable energy utilization andenvironmental protection by realizing sustained growth alongside our customers and society through implementation of ESG
management”. Because the direction we are pursuing in our businesses accords with the general thrust of social pressure
for reducing greenhouse gases and bolstering the resilience of infrastructure as natural disasters grow more severe, we haveidentified helping combat climate change as one of the Key Issues (Materiality) that deserve to be addressed on a priority
basis. Moreover, in April 2022 we announced our support for the recommendations of the Task Force on Climate-Related
Financial Disclosures (TCFD). As the Group works to realize its corporate vision, we will strive to enhance initiatives that
help realize a sustainable society by resolving issues faced by customers and society through the provision of products andservices and by reducing our own CO 2 emissions. In addition, we will work to enhance our approach to climate change andour information disclosure initiatives through dialog with stakeholders.
*For more information about governance, strategic and scenario analysis, and risk management, please visit Takuma’s website.
https://www.takuma.co.jp/english/sustainability/environment/tcfd.html● Conserving resources and protecting the environment● Further strengthening relationships of trust with customers and communities● Ensuring safety and health

Environment: Environmental Initiatives
Disclosing Information Based on TCFD Recommendations

Takuma’s basic approach to sustainability

Takuma’s Management Principles state, “Takuma will strive for social contribution, corporate value enhancement, long-term
corporate development and the satisfaction of all stakeholders by providing goods and services that are needed and recognized
as valuable in society”. Vision 2030, our long-term vision for the year 2030, includes this statement: “Aim to maintain our role ofbeing an indispensable presence in society as a leading company in the field of renewable energy utilization and environmental
protection by realizing sustained growth alongside our customers and society through implementation of ESG management”.
In addition, the 13th medium-term management plan calls on the Group to practice ESG management as it implements thelong-term vision, and we are advancing sustainability initiatives through measures specified in the plan in accordance with theManagement Principles and the long-term vision.

2

ESG Initiatives

2

GovernanceWe consider contributing to measures addressing climate change to be an important management priority, and we are pursuinga series of companywide initiatives under monitoring structures put in place by our Board of Directors. The Executive Manager,
Corporate Planning & Administration Division (secretariat: Corporate Planning Department), who serves as the executive incharge of dealing with climate change, requests or instructs involved departments to cooperate, gathers information about how
climate change will impact our businesses as well as associated initiatives, and evaluates the risks and opportunities posed byclimate change. The Environment Committee (which is chaired by the executive manager of the Compliance & CSR Promotion
Division) then reviews the status of related initiatives. This information is reported to the Board of Directors following discussion
by the Committee of Executive Officers as necessary. The Board of Directors supervises the state of Takuma’s initiatives tocombat climate change as well as their consistency with the company’s business policies (in principle, meeting once everyyear), reviewing policies as necessary and determining strategy.

3Strategy and scenario analysis

After taking into account multiple scenarios announced by the Intergovernmental Panel on Climate Change (IPCC) andInternational Energy Agency (IEA), and referring to various materials released by the Ministry of Economy, Trade and Industry
and the Ministry of the Environment, we established the two scenarios described below (one assuming a temperature rise ofless than 2°C, and the other a rise of 4°C). We then analyzed the two scenarios with a focus on our domestic Environment andEnergy Business, a flagship business that accounts for the majority of the Group’s sales and a segment of our operations
that is likely to be affected by climate change. We conducted this analysis through 2030, the final year of Vision 2030, ourlong-term vision, in an effort to identify the risks and opportunities that climate change would pose for our operations and tosummarize the measures that we could undertake to resolve associated issues.

Established scenario

Overview

Reference scenario(s)2°C scenario

A scenario in which progress in decarbonization
restrains the average worldwide temperature
increase to less than 2°C, as set forth in the Paris
Agreement

NZE, SDS, and APS (IEA)
RCP 2.6 (IPCC)

4°C scenario

A scenario in which a lack of progress indecarbonization results in an average worldwide
temperature increase of 4°C or greater

RCP 8.5 (IPCC)

Note: NZE: Net Zero Emissions Scenario; SDS: Sustainable Development Scenario; APS: Announced Pledges Scenario;
RCP: Representative Concentration Pathways Scenario.

Takuma CSR Report 2023

50

Section 02

Environment: Environmental Initiatives

ESG Initiatives

Summary of scenario analysis results
Item

Policy and law

2°C
scenario

Market4

Strengthening of
regulations andpolicies related to CO2
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schedules.

Risk management

We have put in place companywide risk management structures based on our Risk Management Code, and businessdepartments are using them to implement risk management, including by identifying, avoiding, transferring, and mitigating
risks with the potential to negatively impact our businesses. Going forward, we will incorporate climate change risk into theserisk management structures, and the Compliance & CSR Promotion Division will facilitate the centralized management of our
response.

Indicators and targets

As we work to realize both initiative toward net-zero GHG emissions by 2050 and Vision 2030, Takuma’s long-term vision, we will
resolve issues faced by customers and communities by proposing products and services that contribute to energy savings anddecarbonization while working to reduce our own CO2 emissions.

Impacts

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We established a working group including outside experts with the Planning Department as its secretariat, identified risks andopportunities characterized by major impacts on our management and financial operations, conducted a scenario analysis,
and reported the evaluation and analysis results to the Board of Directors. The Board of Directors is supervising the status of
our initiatives related to climate change through this report.

5Countermeasures

Introduction of carbon
pricing

Adoption of
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technologies

Technology

4°C
scenario

Overview of risks and opportunities
Risks

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addressed

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1 CO2 emission reduction targets and progress through our own products and services
Target: Magnitude of potential reduction in CO 2 emissions
due to newly delivered power plants *1
FY2023800,000

tons per year

Progress

FY2030

Performance as of the end of FY2022

tons per year

tons per year *2

2,500,000

184,000*1: Biomass power plants and Energy from Waste plants delivered from FY2021 to FY2030*2: Calculated based on available generating capacity (renewable energy) as of one month after delivery for plants deliveredfrom FY2021 to FY2022 (four waste treatment plants, one sewage sludge plant, and 10 biomass plants).

2 In-house CO2 emissions reduction targets and progress
TargetProgress
FY2023

Effectively
zero CO 2 emissions

for Scope 1 and Scope 2 at the
Takuma Head Office and theHarima Factory

FY2030Effectively
zero CO 2 emissions

for Scope 1 and Scope 2 at
all Takuma worksites(Head Office, branch offices,
factory, and construction sites)

Performance as of the end of FY2022
Scope 1 and Scope 2 CO 2
emissions at the
Head Office and Harima Factory

356 tons(Down 1,616 tons from FY2021)* FY2030 targets including group companies remain under consideration.
* CO 2 emissions from procured products and use of Takuma products by customers (Scope 3) also remain under consideration.

51

Takuma CSR Report 2023

52

Section 02

Environment: Environmental Initiatives

Helping Combat Climate Change andConserving Resources andProtecting the Environment
The Takuma Group recognizes the need to promote renewable energy (non-fossil energy), improve energy efficiency,
conserve resources and reduce environmental impacts, and use unutilized resources effectively. As one way to dothat, we will work to alleviate the global issue of climate change and to reduce environmental impacts while helping
realize a sustainable society by supplying products and services that draw on technologies for effectively utilizing
energy and protecting the environment that we have developed over more than 80 years of history.

ESG Initiatives

Example initiatives
The Takuma Head Office building and Harima Factory begin using 100% renewable energy

On April 1, 2022, Takuma’s Head Office building and Harima Factory began using power derived from 100% effectively
renewable energy supplied by subsidiary Takuma Energy Co., Ltd. The power is generated by the Takuma Solar Power
Plant at the Harima Factory in 2013 and by biomass power plants and waste treatment plants delivered by Takuma to
date. This initiative has reduced annual CO 2 emissions from Takuma’s Head Office and factory by about 1,616 tons of
CO 2 (FY2021 figures).
Power sources
Takuma Solar Power
Plant at theHarima Factory

FIT Non-fossil value with tracking

Plants delivered
by TakumaPowerpurchases

Our company has established the “TAKUMA Environmental Policy” as follows, aiming to ensure employees contribute to global
environmental conservation.

Takuma facilities
Head Officebuilding

Non-fossil
value

TAKUMA Environmental Policy

100% effective
renewable energy

Takuma EnergyCo., Ltd.

HarimaFactory

Non-fossil
value
Power
supplyThis policy applies to the activities of all company departments.

Environmental Philosophy
Takuma is committed to preserving the environment and realizing an affluent society through business activities under theCompany Motto: “Value Technology, Value People, Value the Earth”.

Operational Guidelines
1.All TAKUMA Group companies will recognize the importance of maintaining a balance between preservation of theenvironment and business activities.
2.Continuously develop activities to preserve the environment that comply with applicable environmental laws andordinances, and ensure environmental control and assessment systems conform to international environmental
standards.
3.Promote development of improved technologies and products for society that preserve the environment.
4.Address resource conservation, energy efficiency, recycling, and minimization of waste generated by all businessactivities.
5.Enhance employees’ awareness and understanding about the importance of preserving the environment throughenvironmental education and internal promotional activities.
6.Provide the community with information on the activities of TAKUMA to preserve the environment.

Helping combat climate change-Initiatives through our Energy Plant Business

Takuma has helped resolve customer issues for many years by delivering numerous boilers and energy plants of various types
and specifications as a pioneer of the boiler industry. In recent years, alleviating climate change and realizing a decarbonizedsociety have been identified as issues that should be addressed on a society-wide level, and renewable energy in the form ofsolar, wind, geothermal, small- and medium-scale hydro, and biomass will play an important role in that effort.
Because trees absorb CO 2 through photosynthesis during the growth process, wood biomass from forest thinning and othersources has the characteristic of being carbon neutral, in that use of energy from timber does not impact the atmosphericconcentration of CO 2. We will help resolve issues faced by customers and society by promoting renewable energy throughutilization of wood biomass.

■Contributing to society through business activities
1

Takuma’s contribution to reducing CO2 emissions
Conversion of waste and biomass into energy by municipal solid waste incineration
plants and biomass power plants supplied by Takuma helps reduce CO2 emissions
by about 4 million tons per year.
Reduction in CO 2 emissions
from municipal solid waste
incineration plants
delivered by Takuma
Approx.

500,000 tons
per year!

Reduction in CO 2 emissions
from biomass power
plants delivered by Takuma
Approx.

3.5 million tons
per year!

Reduction of about 4 million tons
from Takuma products during FY2022!

CO₂

Making effective use of unutilized resources

Most fuels used by biomass power plants, boiler plants, and waste treatment
plants, which are flagship products of our Energy Plant Business, differ fromfossil fuels in that they do not exhibit uniform properties, making it difficult torealize stable combustion. We supply energy-efficient plants by choosing the
optimal combustion model for the customer’s plan based on the technology
we have developed over our long history and our extensive track record ofdelivered facilities.

2

Stable, long-term operation of energy plants

Energy plants sometimes experience unforeseen equipment problems that
result in unplanned stoppages, even if regular maintenance has been carriedout. In January 2023, Takuma opened the Supply Lab, an after-sales service
facility at its Harima Factory, in an effort to build after-sales service structures
capable of maintaining an inventory of, and quickly supplying, parts that are
essential to stable operation in order to lower the risk of long-term stoppages.
Following the launch of the Supply Lab, we will continue to realize stable
operation of customers’ facilities over the long-term through after-sales
service, including maintenance, renovation work, and O&M (operation
management and maintenance management).

Achieving decarbonization
Realizing a low-carbon
society

Resolving customers’
challenges

Supplyinghigh-efficiency
plantsFuel supply
companies

Consumers

Offering
high-quality
after-sales service

Biomass
power plants

General power
distribution
companies

Example biomass power plant business

53

Takuma CSR Report 2023

54

Section 02

Environment: Environmental Initiatives

Conserving resources and protecting the environment

Conserving resources and protecting the environment

Since delivering Japan’s first 24-hour operating waste incineration plant in 1963, Takuma has built and delivered
more than 370 municipal solid waste treatment plants, the most of any manufacturer in Japan. Most of the treatment
technologies used by plants are the result of in-house R&D by Takuma, which continues to embrace the highest
standards of excellence while working to refine its technologies so that they can accommodate the needs of society
it changes over time. Takuma contributes to resource conservation and environmental protection through a broad
product line and after-sales service based on an extensive track record as the industry’s leading company.

Since entering the water treatment business in 1962, Takuma has manufactured a variety of water treatment
equipment over the course of more than 60 years while working to protect the water resources required by society
and the greater water environment. In recent years, companies in this sector have been called upon to addresssocial needs involving priorities such as energy conservation, energy creation, and Life Cycle Cost (LCC) reductions.
In response, we have helped realize sustainable sewage systems by taking advantage of the reliable technology andextensive experience we have developed to date.
Advanced treatment facilities
Reaction tank facilities[Principal equipment]-Initiatives to protect resources and the environment in our Water Treatment Plant Business-Initiatives through the Municipal Solid Waste Treatment Plant Business

Denitration agent
BoilerMunicipal
solid waste

Steam turbine
generator

ActivatedcarbonHydratedlime[Principal equipment]
Low power agitator (Bio Blade Mix)

Stack

Flue gas

Incinerator

Bottom ash(to be recycled)

1

Resource conservation initiatives

We contribute to the formation of a Sound Material-Cycle
Society by working to improve incineration and flue gas
treatment technology, promoting recycling of ash, andreducing use of chemical agents.
● High-performance stoker furnace

Takuma stokers incorporate enhancements and improvementsthat draw on our track record of deliveries, which makes us
the No. 1 supplier of such systems in Japan, along with ourtreatment experience. We pursue ash recycling by maintaining
stable combustion despite a diverse range of waste properties
and creating bottom ash with few embers that exhibits uniform
properties, making it well suited for use in cement recycling.

2

Crude
sludgeMunicipal solid
waste
0%

DryingCombustion

Postcombustion
Reduction in
unburnt content

Proper conditions are maintained

Combustion system

Temperature, etc.

Operational data
Judgments andoperations

Image of combustion
in a furnace

AI model for forecasting
anomalies

Abnormal conditions
are avoidedTime

AI model for forecastingboiler operation

Bottom ash● Fly ash circulation system● High-efficiency power generation system

Fly ash collected by filter-type dust collectors contains chemical
agents used to remove toxic chemicals (hydrated lime andactivated carbon) that are still capable of removing toxic
chemicals. This system consists of technology for utilizing
such chemical agents to maximum effect by reducing chemical
agent use and fly ash volume so that fly ash can be recycled
efficiently and economically.

Municipal solid waste treatment plants demand high-efficiency
power generation technology from the standpoint of reducing
CO2 emissions. We help protect the Earth’s environment throughsuch technology, including high-temperature, high-pressureboilers; low-excess-air combustion; low-temperature economizers;
and use of high-vacuum turbine exhaust steam.

Chemical agents

Stabilization of hazardous
gas removal performance
Reduction in use of chemical agents

Flue gas
Filter-type dust
collector

Reinjectionof fly ash

To stack

Fly ash(containing unreacted
chemical agents)

High-temperature,high-pressureboilers
High-vacuum turbine
exhaust steam

Low-excess-air
combustion

Low-temperatureeconomizers

Anoxic Aerobic
tank
tank

Bio Blade
Mix

Aeration panel
Aerobic tank[Principal equipment]
Fixed-bed anammox process

Disinfection
tank

ExcesssludgeRecovery of maximum
amount of energy from waste

Separator
liquid treatment

Digestertanks[Principal equipment] Rotating drum-type concentrator

Generator

Sludge-fueled power
generation facility

Return water[Principal equipment]
Step grate stoker type sewage
sludge incineration and power
generation system

Processing flow in water treatment plant equipment at a sewage facility

1

Upflow moving-bed sand filtration system

Our upflow moving-bed sand filtration system (Uniflow Sand Filter),which removes Suspended Solids (SS) from water, is primarily used
for final treatment at sewage treatment plants to allow clean, treatedwater to be released into rivers. Some treated water is also reusedat the facility, helping to conserve water resources. Uniflow Sand
Filter systems boast top domestic market share in moving-bed
sand filtration systems, and we have delivered more than 2,800 ofthese long-selling products, which feature water quality purification
technology, in Japan. In recent years, many of the systems we havedelivered have been a new high-speed model that delivers two to
three times the treatment volume with the same area as conventional
fixed-bed sand filtration systems. We are also seeing more projects
that replace fixed-bed sand filtration systems with this system while
retaining existing foundation work and related infrastructure.

2

Incinerator

Sludgetreatment

Sludge treatment facility●AI-enabled combustion control system

This next-generation combustion control system, which uses
AI technology, reproduces the operational skills of experienced
operators. Since the system precisely forecasts combustion
fluctuations that are unique to waste incineration to determine andimplement the appropriate response, stable combustion conditions
can be maintained at all times, even when the properties of thewaste fluctuate over the medium and long-term.

AI

Ash

Anoxictank

Separator liquid treatment equipment

The introduction of AI-enabled combustion control andhigh-efficiency power generation serves to safeguard
the environment in the surrounding area and reduce CO2
emissions.

Maintenance ofstable combustion

Moisture
Flammable
content

Sand filter

Drawn-off sludge

Environmental protection initiatives

100%

Final settling pond

Discharge
Anaerobictank

Equipment sequence at a high-efficiency, low-environmental-impact municipal solid waste treatment plant

Reaction tank

Pre-processing
equipment

Induceddraft fan

Fly ash(to be recycled)

Upflow Moving-bed Sand Filtration system(Uniflow Sand Filter)

Initial settling pond
SewageintakeFilter-type
dustcollector

Waste pit

Upflow moving-bed sandfiltration system

Step grate stoker type sewage sludge incineration and power generation system

Sludge generated by the sewage treatment process is a type ofbiomass, and such resources are expected to be used as renewableenergy. Conventional sludge incinerators were net consumers ofenergy because they required auxiliary fuel and used large amountsof electricity, but this system draws on the core Takuma technologies
of combustion technology and boiler technology to make possible
an energy-creating system that generates more power than theincinerator consumes while using sludge as fuel, as long as it
operates at or above a certain scale.

Generator
SludgeWasteheat boiler
Step gratestoker furnace

Dryinggrate

Combustion grate
Burn-out grate
Bottom ash

Combustion air fan

55

ESG Initiatives

Sludge-fueled power
generation facility

Takuma CSR Report 2023

56

Section 02

Environment: Environmental Initiatives■Environmental accounting

Environmental reporting
Takuma reports the environmental impact of its business activities as well as the manner in which
it takes environmental considerations into account in accordance with the Environmental Reporting
Guidelines (issued by the Ministry of the Environment). This environmental reporting program includes
not only environmental information extracted from our overall business activities from an environmental
standpoint, but also information about related economic and social aspects of those activities.

■Environmental data (non-consolidated)
Total energy input volume

Greenhouse gas emissions(GJ per year)

Environmental accounting is the process by which companies and other entities recognize the cost of environmental conservationin their business activities as well as the effects of those activities and measure and communicate them in as quantitative a manner
as possible (either in terms of monetary amounts or amounts of materials) with the goal of pursuing environmental conservation
initiatives in an efficient and effective manner while maintaining a good relationship with society so as to facilitate sustainable
development.
We have disclosed our own environmental accounting system since FY2006 when we introduced it based on the “Environmental
Accounting Guidelines 2005” issued by the Ministry of the Environment. As our business activities mainly involve environmental
conservation plants and their equipment, Takuma Group employees have a significant awareness of the need for environmental
conservation, and we have been implementing approaches toward such issues within the Takuma Group.

4,000

Investment

Item
3,000

44,40647,90250,92753,982

1,758

1,914

2,032

Pollution
prevention costs

2,137

Global environmental
conservation costs

30,000Resource
circulation costs

1,000

0

2018

2019

2020

2021

0

2022 (ﬁscal year)

The total energy input volume of the fuel and the electricity
consumed at Takuma during FY2022 fell slightly compared to
FY2021 levels. We will continue to promote energy savings fromhere on out.

Total production of waste, etc.

553

2018

2019

2020

2021

2022 (ﬁscal year)

The greenhouse gas emitted by Takuma is limited to carbon dioxide(CO2). FY2022 emissions fell significantly from FY2021 due to theintroduction of power derived from 100% renewable energy at
Takuma’s Head Office building and Harima Factory. We will continue
striving to reduce CO2 emissions.

Input volume of water(Tons per year)(㎡ per year)

1,200

60,000

400

364

0

2018

671

558

671

495

31,38725,390

472

120
2019

113
2020

25,25827,033

107

101
2021

25,17620,000

314

193
104

Administration costs
Social activity costs
Total

FY2021

FY2022

235,529

263,398

Total energy input volume(GJ)

109,051

100,685

81,214106,246

3

52,42546,094

Input volume of water (m )(2) Environmental conservation benefit related to waste orenvironmental impact originating from business activities―

15,059―35,400Volume of greenhouse gas
emissions (tons-CO 2)

4,587

2,626

1,908,385

Total production of waste,etc. (tons)

1,167

1,198

148

149

51,926

46,18367,586

R&D costs

Item(1) Environmental conservation benefit related to resources
input into business activities―

10,980384,329

2,339,468

Investments and expenses related to the prevention, reduction,
and/or avoidance of environmental impact, removal of such impact,
restoration following the occurrence of a disaster, and other activities
are measured in monetary value.

Final waste disposal
volume (tons)
3

Wastewater volume (m )Environmental conservation benefits are measured in physicalunits and are the benefits obtained from the prevention, reduction,
and/or avoidance of environmental impact, removal of such impact,
restoration following the occurrence of a disaster, and other activities.

40,000731
507

Expense(thousand JPY)

Economic benefits of environmental
conservation measures■ Total production of waste, etc.
■ Recycling■ Total final disposal volume of waste, etc.
800

(thousand JPY)

Business area costs

51,6852,000

Environmental conservation effectEnvironmental conservation cost(Tons of CO 2 per year)

90,00060,000ESG Initiatives

02022 (ﬁscal year)

Takuma generated about the same volume of waste in FY2022 asduring FY2021, but a slight reduction in appropriate processing suchas recycling led to small increase in the volume of waste subject
to final disposal. Going forward, we will work to further reduce theamount of waste we generate. Although we work to recycle and reuse
waste, waste that cannot be reused is disposed of in accordancewith the Industrial Waste Control Manifest System.

2018

2019

2020

2021

2022 (ﬁscal year)

Water resource inputs by Takuma during FY2022 fell compared to
FY2021. We will continue striving to reduce water resource inputs.

■PRTR target substance emissions
Although our business activities do not involve a wide variety of chemical substances on a massive scale, we use a few designatedchemical substances. Consequently, we report and register such chemical substances designated under the Pollutant Release
and Transfer Register (PRTR) Law, in accordance with relevant laws and ordinances, with the local government.
● Dichloromethane (CAS No. 75-09-2)
FY

2018

2019

2020

2021 2022

Emissions (tons per year)

0.27

0.08

0.00

0.00

● Toluene (CAS No. 108-88-3)● Ethylbenzene (CAS No. 100-41-4)

0.11

FY

2018

2019

2020

2021 2022

Emissions (tons per year)

0.06

0.09

0.07

0.13

FY

2018

2019

2020

2021 2022

Emissions (tons per year)

0.98

1.34

1.41

1.51

●Xylene (CAS No. 1330-20-7)

0.12

1.02

FY

2018

2019

2020

2021 2022

Emissions (tons per year)

1.12

1.47

1.54

1.62

Breakdown ofbenefits

Income from the sale ofwaste for recycling, etc.
(thousand JPY)

12,378Economic benefits of environmental conservation measures, definedas contributions to the profit of a company or other entity derived
from having pursued environmental conservation measures, aremeasured in monetary value.
Period covered: April 1, 2022, to March 31, 2023
Scope of statistics: The following companies are included in these statistics.
Domestic: Takuma Co., Ltd. (Head Office; other offices, including overseas sites; and the Harima Factory); Nippon Thermoener Co., Ltd.; Takuma
Technos Co., Ltd.; Hokkaido Sanitary Maintenance Co., Ltd.; Takuma Technos Hokkaido Co., Ltd.; Sunplant Co., Ltd.; Takuma Engineering Co.,
Ltd.; Takuma System Control Co., Ltd.; Dan-Takuma Co.,Ltd.; Kyoritsu Setsubi Co., Ltd.; Kankyo Sol-Tech Co., Ltd.; Takuma Plant Co., Ltd.; andTECHNO LINKS Inc. Overseas: Taiden Environtech Co., Ltd., and Siam Takuma Co., Ltd.

Environmental management
The situation concerning the acquisition of ISO 14001
The Harima Factory has earned ISO 14001 certification, and it practices environmental management activities inaccordance with an environmental management system that is designed to comply with international standards.
Our group companies Nippon Thermoener Co., Ltd.; Takuma Technos Co., Ltd.; Hokkaido Sanitary Maintenance Co.,
Ltd.; and Dan-Takuma Co.,Ltd., have also acquired ISO 14001 certification.

1.05

These materials are used for antirust painting of boiler structures and so on.

57

Takuma CSR Report 2023

58

Section 02

Social:Social Initiatives

Strengthening Relationships of Trust with
Customers and Communities

Participation in the community

Working through initiatives to pursue customer satisfaction, ensure the stable and continuous operation of plants
and equipment, and create new value for regional resource recycling and communities, the Takuma Group will
maintain and strengthen relations of trust with customers and communities by supplying high-quality products andservices that facilitate stable, long-term operation on an ongoing basis in the form of infrastructure that supports
regional society and customers’ businesses.

Pursuing customer satisfaction

Takuma and its group companies strive to deliver safe, trustworthy facilities that allow local residents to live withpeace of mind by disclosing information in an appropriate manner, participating in local activities, and actively seeking
interactions with local residents, for example by staging clean-up activities in the areas near facilities, hosting events
at which local residents can gather, and orchestrating evacuation exercises envisioning natural disasters.
Although these efforts have been impacted by the COVID-19 pandemic in recent years, we continue to pursue
them while taking steps to prevent infection. This section introduces some examples.

In recent years, the amount of attention paid by society to not only manufacturing and service, but also quality
across a wide range of fields, has been growing. Against this backdrop, it will be necessary not only to increase thequality of products, but also to improve management of operations and quality in each process from plant planningto delivery (including sales, planning, design, procurement, manufacturing, construction, and management) andemployees’ operational capabilities so that we can supply products and plants that satisfy customers.

Machida High Trust Co., Ltd.
Machida City Bio-energy Center, which Takuma has been contracted tooperate, held three events during FY2022, in April, July, and November, withthe goal of raising awareness about the 3Rs (reduce, reuse, and recycle).
The events, which were attended by more than 500 residents, had alittle something for everyone, including a facility tour with a stamp rally,
recycling-related craft workshops, experiential learning for waste collection,
and a fishing game about waste sorting using felled bamboo.

To that end, our Head Office, and branch offices have earned certification under ISO 9001 (Quality Management
Systems), and the Harima Factory has earned certification under ISO 9001 and ISO 14001 (Environmental
Management Systems). We are working to improve the quality of operations, products, and business processes
in accordance with the latest 2015 editions of those standards.

Hokutan High Trust Co., Ltd.

Quality Policy
Takuma Co., Ltd., has adopted the following Quality Policy in order to provide satisfying products that meet customer expectations
and earn a high level of trust while continuously improving the effectiveness of its quality management system.

Quality Policy

Manufacturing products that result in customer satisfaction

In keeping with the above Quality Policy, we have identified the three priority items listed below. Recognizing those items, we areundertaking a variety of initiatives to increase the quality of products and business processes in all processes, including sales,planning, design, procurement, manufacturing, construction, and management.

1

Principal initiatives to improve quality● Establishing quality targets for each division’s processes; monitoring, measuring, and evaluating implementation status (twice a year)● Holding QM Committee meetings (quality management reviews, twice a year)● Holding internal quality audits to evaluate the status of management systems in individual divisions’ processes (once a year)● Using an Operational Skill Achievement Checklist designed to improve employees’ operational skills (once a year)

3

Customer satisfaction survey

We administer questionnaires targetingcustomers who had construction work done byasking them to assess the overall experience,
including the nature of the work performed,
suitability of the delivered equipment, andthe level of service provided by Takuma staff.
Our QM Committee analyzes the status quoand studies measures for improving quality
based on feedback from customers in a timely
manner, working to improve the quality of the
products we supply to customers and of ourown internal operations by applying lessons
learned horizontally across the organization.

(Points)

100●Average score

85.8

87.7

■Number of responses

88.2

86.8

85.6

86.3

(Responses)

40

86.1

88.4

86.5

88.5

80

30

60

20

40

27

23

19

27

27

28

36

22

25

23

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

10

(FY)

Questionnaire average score (out of 100 possible points)
Scores averaging higher than 86 points for each of the last 10 years indicate apositive evaluation of these efforts.

59

Clean Park Hokutan, which Takuma has been contracted to operate, hostsa variety of events that let attendees experience nature throughout the year
using a satoyama environment that was built as a place where people could
encounter nature around the plant while learning about the rich natural world
and the importance of life.
In October 2022, numerous families participated in a “Potato-digging andMushroom-foraging Festival,” which began with the harvesting of sweet
potatoes that had been planted in spring and continued with a talk about
mushrooms by an expert, after which attendees hiked up a nearby mountainand continued their study.

Priority items

Creating value to earn customer satisfaction: Ascertaining customer needs and making improvements based on past experience
Carrying out risk management: Addressing changes in the business environment and human error
Implementing human resources management: Implementing human resource development and ensuring skills are
passed down to younger employees

2

ESG Initiatives

Initiatives designed to ensure stable plant operation
The Takuma Group manages facilities under contract from many local
governments as part of its long-term comprehensive operation businesssuch as DBO, which offers operation and maintenance management
service collectively for municipal solid waste treatment plants.
Since drawing on the extensive expertise that we have gained in the areaof plant operation and maintenance management from our long-term
comprehensive operation business to earn our first private-sector O&M(operation management and maintenance management) contract from
SARA Inc., in 2019, we have received contracts for plant O&M operations
from multiple private-sector customers.

An equipment inspection

At each site, operational status and equipment operation data collected andanalyzed by our Plant Optimization Comprehensive Support System (POCSYS ®)provides valuable feedback for facility operations. We are also leveraging remotesite support using wearable cameras to realize stable plant operation. As partof a continuing program of initiatives geared to ensure safe, secure facility
operation, we hold monthly liaison meetings with customers to report on facility
operational status and exchange information.
Going forward, the Takuma Group will continue to realize stable, long-term
operation of facilities by drawing on the expertise that Takuma and group company
Takuma Technos Co., Ltd., have accumulated over many years of operations torealize optimal operation and maintenance management of plants.

Use of wearable cameras toprovide site support

Takuma CSR Report 2023

60

Section 02

Social: Social Initiatives

ESG Initiatives

Pursuing Partnerships and Innovation
Conventional products and services are undergoing a dizzying evolution against the backdrop of progressin the Fourth Industrial Revolution and the evolution of information and communications technology,
fueling fast-paced change in society. Working through initiatives to utilize digital technologies and promote open
partnerships and innovation, the Takuma Group will look to further bolster its strengths by focusing on proposals
based on society’s and customers’ needs, R&D to facilitate them, and technological improvements so that it cankeep up with social change.

Open partnerships
At a time when society is changing rapidly, it is necessary to develop businesses quickly and in a waythat transforms those changes into opportunities. By deepening partnerships with other companies andorganizations so that we can consistently provide the products and services that customers demand, we
will strengthen our ability to propose solutions to customers and accelerate R&D.
1

Utilization of digital technologies (AI, IoT, robots, and more)
Progress in the Fourth Industrial Revolution and in the development of telecommunication technologies is
rapidly transforming conventional products and services. Plant Engineering, Procurement, and Construction(EPC), operation management, and maintenance are no exception, and we believe that the transition to digitaltechnologies will only accelerate going forward against the backdrop of trends including labor shortages. Takuma
is pursuing development and other initiatives from a medium- and long-term perspective so that we can create
added value, for example by realizing technologies facilitating remote and fully automated operation of plants,
streamlining and reducing labor requirements for operations by utilizing data, and strengthening competitivenessin the areas of EPC and after-sales service.
1

Increases in the added value of facilities and plants

In addition to providing 24-hour remote monitoringand operational support through Solution Lab, ourremote monitoring and operational support facility,
we are working to realize stable plant operation
through such measures as facilitating stable
operation by collecting and analyzing plant
operational data and by optimizing maintenance.

Expanding resources

We are pursuing partnerships and alliances with companies in related fields as well as M&As in order to strengthen our EPC
capabilities.

2

Initiatives to contribute to the maintenance and expansion of existing businesses

To resolve the challenges faced by customers and communities, we are strengthening our ability to propose solutions with the helpof partners for knowledge that we lack.

3

Initiatives to create new businesses by promoting open innovation

In addition to joint research with universities and other companies, we are working with other companies to develop new
businesses as well as decarbonization technologies.

Pursuit of innovation
In recent years, the problem of climate change has sparked calls to realize a decarbonized society throughcarbon-neutral technology and to promote further environmental conservation. Takuma is focused on pursuing
R&D and technological improvements in order to develop technologies and products that are sought by society
and customers.

Topics
1 Conversion of CO2 in flue gas into solid carbon
This technology manufactures solid carbon using CO 2 separated and captured fromthe flue gases from municipal solid waste treatment plants as the raw material andenergy from the same plant. The solid carbon is expected to be used as a raw material
for the manufacture of chemicals such as carbon black, and we are currently involvedin a research and development project that is receiving technological guidance from
Shizuoka University.

2 Biomethanation, which also yields a2

Strengthening of competitiveness in EPC operations,operation management, and maintenance service

Plant EPC, operation management, andmaintenance require many years of experience,and our accumulation of such experience since
our founding has become a core Takuma strength.
To reliably pass on experience and skills so that
we can provide high-quality EPC and after-sales
service, we are working to further improve individual
employees’ skills by using digital technologies totransform knowledge and expertise into formal,
explicit knowledge. Moreover, we are working tostrengthen competitiveness in EPC and after-sales
service by investing limited time and humanresources in the areas that most deserve suchattention, for example by streamlining operations
through use of technologies such as RPA.

61

substitute for natural gas

This technology generates high-concentration biomethane from biogas from themethane fermentation of garbage and other waste and CO 2 contained in flue gases
by adding hydrogen and relying on a microbial process to convert the mixture intomethane. It is characterized by low facility energy consumption and high operational
stability. The technology offers a high level of versatility since biomethane can be used
as a fuel to generate electricity or as a substitute for natural gas, and we are currently
conducting joint research with Kyoto University, Hokkaido University, the National
Institute for Environmental Studies, Toho Gas, and Ebara Jitsugyo.

3 Technology for separating and capturing CO2(chemical absorption method)

Biomass power plant・Mineralization(Cement, concrete)

Absorption
tower

Regeneration
tower

・Chemicals(Carbon, methanol, etc.)

・Fuel (methane, etc.)
Working with the National Institute of Advanced Industrial・Liqueﬁed carbon
Science and Technology, we are conducting joint researchdioxide gas
Captured CO・Dry ice
Flue gas
to develop technology for separating and capturing CO 2
・Underground storage of CO
using a chemical absorption method that utilizes non-water(CCS)
absorbent for use with CO 2 in flue gases from biomass power
Power
Separation andTransport, use,plants and municipal solid waste treatment plants. Under
generation
capture of CO2
and underground storage
the Research, Development and Demonstration Projectof CCUS Technology, which Takuma is carrying out with Nippon Paper Industries Co., Ltd., under contract from the New Energy andIndustrial Technology Development Organization (NEDO) and which is conceived to yield energy savings and downsizing of equipment,
we will research the targeted technologies, and we will look to use the absorbent to treat plant flue gases in the future as we evaluate its
performance and work to commercialize it.
22

Takuma CSR Report 2023

62

Section 02

Social: Social Initiatives

ESG Initiatives

Promoting Activities of Human Resources
In an effort to achieve the goals of the 13th medium-term management plan, which is the first step towards
realizing Vision 2030, our long-term vision, we are investing in human resources through the following policies asways to strengthen our management foundation and undertake business activities that help resolve customers’
and society’s issues.

2

Putting in place educational systems

We have working to put in place and enhance educational programs in an effort to advance employees’ abilities, for example
by improving their skills and management capabilities across a broad range of levels, including just hired new-graduate andmid-career as well as management candidates.
Recently, we have identified the decline in internal exchanges due to the COVID-19 pandemic at a time when employment is
growing as an issue that needs to be addressed, and we are particularly focusing on providing training designed to strengthencommunication skills.

Policy on Human Resource Development
In an effort to precisely identify changes in the market environment and diversifying customer needs
and contribute to the long-term, sustained development of society through the resolution of customers’issues, we will hire human resources with diverse values and backgrounds, improve employees’ skills,
provide opportunities for them to use those skills, and encourage their growth.

■Education and training programs

Policy on Takuma’s Internal Environment Improvement
We are working to put in place human resources programs and a workplace environment that boost
motivation while making it easy for employees to do their jobs so that a diverse workforce can pursue
careers at Takuma over the long-term.

To realize Vision 2030, our long-term vision, we are
employing human resources with the goal of about 25
new-graduate and about 35 mid-career as part of efforts
to strengthen our management foundation.

Employee data (non-consolidated)*As of March 31, 2023

(Including 917 men and 85 women)

Average yearsof service

14.8

42.8

Rate of attrition for
personal reasons

1.7% (FY2022)

Average age

Trend in number of regular employment (number of female employees in parentheses)

63TechnicalCOM
presentation
trainingby 2-year
for 3-year
employees employees

COM training: Communication training

Thesisdiscussionby 5-year
employees

COM
training
for 6-year
employees

COM
training
for 8-year
employees

Presentation
by 10-year
employees

Midcareer
training

Management
trainingCOM
training
for section
managers

Field-specific training

With regard to new-graduate hires, we have implemented
a variety of measures at each stage–forming a pool ofprospective applicants, motivating them to apply, andscreening their applications. In particular, we are working
to motivate prospective applicants to apply and join
Takuma by communicating information about topics likeour businesses, corporate culture, and what we consider
ideal employee characteristics in order to raise Takuma’s
visibility, for example by using YouTube; visiting universities,
vocational schools, and high schools; participating incampus seminars and joint job fair; offering internships; andhosting “work experience” days. With regard to mid-careerhires, we are strengthening initiatives and diversifying ourrecruiting routes, for example to implement scouting and referral recruitment, even as human resources introductions remain
the principal channel through which we find new employees.

1,002

Plant tour

■Educational program diagram

Newemployee
training

Securing human resources

Number of
employees

Group activity

Rank-specific training

Securing and training human resources
1

LectureFY2023FY

FY2018FY2019FY2020

FY2021

FY2022*New-graduate
hires only

New-graduate hires

21（2）

20（2）

25（3）

26（2）

28（4）

35（4）

Mid-career hires

20（1）

24（1）

37（2）

53（5）

41（3）

―

Total

41（3）

44（3）

62（5）

79（7）

69（7）

35（4）

Training for
mid-careerhires

Training forsupervisorsof mid-career
hires

Logic
training

Englishtraining

CSR
training

Technical
training

IT training

Promoting diversity
1

Increasing female participation

We have set a cumulative goal for FY2021 to FY2025 of adding
at least 35 new female employees by hiring women for main
career track and management positions and by promoting
employees in general positions as part of our general employer
action plan under the Act on the Promotion of Women’s Active
Engagement and as a key performance indicator (KPI) for our
Key Issues (Materiality).

(Number of employees)

As we strive to achieving our targets, we have worked to increase
our points of contact with female students in connection with
new-graduate hiring, for example through participation incorporate research projects for female students organized by
local governments, information sessions hosted by women’scolleges and universities, and joint information sessions forfemale students. In mid-career hiring, we are working to increase
the number of positions conceived to be held by women while
cooperating on hiring women with departments that are seeking
to hire new employees.

20

45
40

(Percentage)■Number of female employees in main
career track and management positions
4.5％■Percentage

3.6％

35

3.8％

3.5％

3.2％

30

3.0％

2.5％

25

4.0％

2.5％

1.9％

2.0％

1.6％

15

1.5％

10

1.0％

5
0

14

17

22

31

36

39

2018

2019

2020

2021

2022

2023 (FY)

0.5％
0％The number and percentage of female
employees in main career track and management positions

During FY2022, we offered main career track and management positions to a total of six women (three new graduates and three
mid-career applicants), bringing the cumulative total for FY2021 and FY2022 to 16.

Takuma CSR Report 2023

64

Section 02

Social: Social Initiatives

2

TopicsEncouraging senior citizen participation

Hosting“Activating the Workplace Environment,”a business skill enhancement
training session

As of April 2023, a total of 41 post-retirement-age employees
continued to work at Takuma.
To implement Vision 2030, our long-term vision, it will be necessary
for senior employees to take advantage of their extensive knowledge
and experience as they contribute to the company. The fifties area time of transition in areas such as physical strength, health, andfamily environment, and work life is no exception; even as older
employees are able to take advantage of the extensive knowledge
and experience they have accumulated, it is also important for themto change their past experiences, ways of thinking, and values asnecessary in response to the development of technology and thediversification of values.

In November 2022, we offered business skill enhancement training
session for section managers. The training, which featured an outside
instructor, sought to activate the workplace environment by improving
communication skills and creating guidelines to address harassment bypromoting understanding, facilitating inspections of current conditions,and fostering prevention.

To that end, we have augmented a review of our human resources
programs by offering an educational (e-learning) program designed
to facilitate learning and new realizations through self-study so that
employees in their fifties can take advantage of the knowledge andexperience they have accumulated to date, encounter new ways ofthinking and values, and embrace their jobs.

2

Feedback from employees in their fifties who have participated in the educational program●Through the program, I realized anew that there are a lot of things that I want to do and that I need to do. I look forward
to using the experience and knowledge I have accumulated to date and working to keep up with new information andcommunications technologies while learning how to adapt to new things with flexibility as I strive to realize those goals.
● I was aware of the need to care for my parents, but I had not been studying at all, so this course was extremely useful. I
learned that a variety of procedures have already been put in place, so in the future I would like to consider them moredeeply in light of my own situation.

3

Promoting employment of people with disabilities

In addition to establishing a specialized section within
the Human Resources Department in April 2020 andassigning staff members to assist with hiring of people
with disabilities as part of a focused effort to support
such hiring, Takuma is working to make support forhiring of people with disabilities a permanent part ofthe company’s culture with the assistance of outsideorganizations dedicated to helping companies hirepeople with disabilities. As of April 2023, a total of 18
people with disabilities were performing jobs that suited
their abilities, including cleaning offices, entering data at
the request of various departments, sorting and sending
mail and packages, and placing orders for businesscards.
We are also working to hire human resources, forexample by visiting schools for people with disabilities,
accepting people for workplace training, and participatingin joint interviews.

(Number of employees)

25■Number of employees with disabilities (Actual employment rate (%) )■Actual employment rate (%)
2.39
2.5

2.26

20

1.78

1.74

1.80

1.95

2.0

15

1.5

10

1.0

0.5

5

0

11

11

12

14

16

18

2018

2019

2020

2021

2022

2023 (FY)0

Trend in the number of employees with disabilities
and actual employment rate

Improving employee satisfaction
1

Respecting human rights and preventing harassment

Our company sets out its respect for basic human rights and prohibition of discriminatory acts in the Takuma Group Ethics Charter,
Takuma Group Code of Conduct, and labor regulations.
We are also working to put in place a safe workplace environment and to prevent harassment through regular educational
programs (including e-learning and in-person training).

65

ESG Initiatives

Parenting support and promotion of flexible workstyles

We have set utilization of parenting support programs (childcare
leave, maternity/paternity leave, flex time, shortened working
hours, and telework) of 25% (average for FY2021 to FY2025),
which is more than double the figure for FY2020, as a KPI, and wehave introduced the programs described below in order to help
employees balance their work responsibilities with the demandsof parenting and nursing care. Thanks to multipronged efforts
to spread awareness of these offerings, for example by offering
information about programs to employees with recently bornbabies on an individual basis, the average cumulative utilization
rate for FY2021 and FY2022 rose to 35%.
In addition, we are continuing to take advantage of our teleworkprogram in order to help employees balance their work andpersonal responsibilities, including parenting, nursing care, and recovery from illness, while increasing productivity, even after
COVID-19’s reclassification by the Japanese government as a Class 5 disease, as part of a larger effort to reassess programs
to ensure employees can do their jobs without regard to time or place.
● Childcare leave and maternity/paternity leave● Flex time

●Telework● Nursing-care leave● Shortened working hours● Special leave for husbands whose wives are giving birth

Rate of male employees’ utilization of childcare and paternity leave during FY2022
Number of male employees whose
spouse gave birth

Number of male employees
who utilized childcare leaveand related programs

Percentage of male employees
who utilized childcare leaveand related programs

34

11

32.3％

*In addition to the above, 19 male employees took time off for reasons related to childcare, bringing the utilization rate of related programs to 88.2%.

Impressions from an employee who has taken
advantage of Takuma’s childcare leave
Infancy is an important time for both baby and parents, and I decided to take childcare leave
because my wife and I wanted to focus on working together to raise our new child.
Because I took advantage of this leave program, I was able to see my child’s daily growth,which made me extremely happy, and at the same time, I personally experienced the difficultyof parenting. Comparing myself before and after taking childcare leave, I now take the initiative
to help out with household chores and parenting, with the result that I do not leave my wife to
do as much as before, and I have come to value time with our newborn child.
(From a male sales employee in his 30s)

Takuma CSR Report 2023

66

Section 02

Social: Social Initiatives

ESG Initiatives

Ensuring Safety and Health
The Takuma Group will work to further strengthen its core strengths of technology and expertise as well as
relationships of trust with customers while preventing a decline in the quality of its products and services
or in the level of trust it enjoys from society by safeguarding workers’ physical and mental health andbuilding an environment in which it is easy for employees to do their jobs. Specifically, we will accomplishthese goals by ensuring occupational safety and health, managing employee health, and putting in place
an employee-friendly workplace environment.

Occupational safety and health initiatives
Since FY2006, we have introduced TK-COHSMS based on an occupational safety and health management
system for the construction industry and worked actively and independently to improve our safety and healthactivities. We believe that among these efforts, the manner in which (1) safety inspections, (2) mandatory safety
and health education (education for construction site representatives), and (3) creation of pre-work safety
procedure checklists known as SSAs have been steadily adopted by all departments and used to consistently
improve the level of knowledge about Takuma’s safety and health is particularly noteworthy.

We have adopted the following safety and health objectives for FY2022: eliminating rule violations by activating
safety and health education, establishing measures to reduce risks, rolling out new safety patrols with the goalof reducing accidents, and sharing robust safety awareness while strengthening cooperative structures with the
Safety and Health Cooperative Association. Takuma and involved contractors worked together to revitalize safety
and health activities companywide by reliably fulfilling their respective roles.
We have adopted the following safety and health objectives for FY2023: eliminating failures to identify hazards that
could lead to serious accidents during safety assessments; providing precisely targeted safety guidance throughsafety patrols; strengthening guidance during safety and health management activities by worksite managers,
foremen, and safety and health managers; and sharing robust safety awareness while strengthening cooperative
structures with the Safety and Health Cooperative Association. Rather than contenting ourselves with the statusquo, we will pursue new safety and health initiatives to foster a strong awareness of the concept that underlies
our safety and health policy—“understanding the need for respecting people and giving top priority to safety andhealth”—on the part of everyone who is involved in our operations.

Safety and health activities and their results
Safety inspection system

We maintain a system where any construction or installation work starts
only after the safety and health manager or other responsible official in eachdepartment conducts a successful safety inspection based on safety andhealth plans for the construction or installation work as prepared by our
primary partner companies.

A safety inspection meeting

Safety patrols and safety lectures

Based on an annual plan, safety patrols are carried out at worksites by the
Safety and Health Committee (comprised of committee members and advisors),
Safety Control Department, and Construction Division along with safety lecturesin a precisely targeted and efficient manner.
Safety patrols focus on identifying and eliminating risks as early as possible,
while safety lectures are conceived to prevent occupational accidents andraise employees’ safety awareness by offering an opportunity to hand out andexplain materials such as examples of accidents. Both programs help ensure
safety at worksites in the field.
● Number of safety patrols implemented in FY2022

By Safety and Health Committee (members, advisors)
By Safety Control Department
By Construction Division

67

We are putting in place mechanisms for preventing accidents, including byassigning workers with extensive knowledge in areas such as safety andhealth-related laws and ordinances thanks to an education program that began
on April 1, 2004, to individual construction sites.
● April 2004 to

March 2023

Cumulative number of trainees
Number of trainees passing the completion exam

Education for construction site representatives(Head Office)39,352
22,401

Construction employee education
We offer safety and health education to construction work employees at affiliates
so that they can follow safety rules while working safely.

4

Inspection of safety and protective gear

Promoting the digital transformation (DX) in safety and health management

We are promoting a qualitative transformation (DX) in our safety and health management activities as an important techniquefor reducing accidents while using information and communication technology (ICT) to drive effective techniques for reducing
workload, for example through development of information databases, acceleration of information availability, streamlining ofcommunications and enhancement of associated accuracy, and visualization.

Safety and health awards in the Construction Division /Safety and Health Promotion Meeting
Takuma recognized employees who worked to prevent occupational
accidents at worksites and set zero-accident records at an internalaward ceremony held on the anniversary of the company’s founding.
Although we had planned to similarly recognize primary partnercompanies who helped set zero-accident records at the Safety and
Health Promotion Meeting, we were forced, with great regret, tocancel the event along with the awards ceremony again in FY2022
due to the COVID-19 pandemic. However, we were able to recognize
award recipients who set zero-accident records by sending them acommemorative award.

Internal presentation of azero-accident record award

The total actual working
hours for Takuma in 2022 wasabout 3.64 million hours. Boththe number of occupational
accidents and accidents
resulting in work stoppages
fell from 2021, in terms of boththe accident frequency rate
and the accident severity rate.

Takuma’s safety results
10
1.76
0.06
5

0.87
2.16

Accident frequency rate
Accident severity rate
Number of casualties
1.62
0.03
7

5

1.85
0.12

0

2.0
1.5

6
0.27
0.01

3

1

2018

2019

2020

2021

2.5

1.0
0.5

0
2022 (Year)Year

Accident
frequency rate

Accident
severity rate

2018

1.09

0.30

2019

1.69

0.29

2020

1.30

0.24

2021

1.39

0.41

2022

1.47

0.22

*Accident frequency rate: *Indicates the frequency with which
accidents occur as the number of fatalities caused by occupational
accidents per 1 million actual working hours.

Reference: Nationwide average accident frequency andseverity rates for the construction industry (general construction)*Accident severity rate: Indicates the seriousness of accidents as
the number of work-days lost per 1,000 actual working hours.

Number of casualties due to occupational accidents
×1,000,000
Total actual working hours

Total work-days lost
×1,000Total actual working hours

Managing employee health

68

238

334

We offer specialized safety and health education to employees and supervisorsfrom affiliates so that they can offer precise safety guidance and fulfill their
responsibilities as site supervisors.

Takuma’s
accident frequency rateand severity rate

2

Education for construction site representatives

Occurrence of occupational accidents at Takuma in recent years(Number of casualties, accident frequency rate, and accident severity rate)

We strive to ensure a safe work environment at all construction sites by
eliminating risk factors identified by those inspections before work begins.
● Number of safety inspections completed in FY2022: 98

Safety and health education

Number of casualties(persons)

1

3

Safety patrols

To follow up on employees’ regular check-ups, we work with industrial physicians to recommend additional testing
and treatments to individual employees and provide health guidance from industrial physicians. Additionally, we areworking to assist employees who work excessively long hours, for example by assessing the conditions under which
they work and their subjective symptoms, recommending they meet with an industrial physician, having the Human
Resources Department conduct interviews as necessary, and taking corrective action with regard to supervisors.
Furthermore, we have created opportunities to consult with the labor union concerning working hours, and we share
information about the topic and exchange views about and discuss associated measures.

Takuma CSR Report 2023

68

Section 02

Governance: Governance Initiatives

ESG Initiatives

Strengthening Corporate Governance■Audit & Supervisory Committee

Corporate governance structures
We have put in place the following governance structures:(As of June 27, 2023)

General Meeting of Shareholders
ReportingAppointment anddismissal

Appointment and dismissal

Reporting and statement of views

Board of Directors(11 members, one of whom is female)

Audit & Supervisory Committee(5 members)

Auditing

Appointment
and dismissal
Discussion
and reporting

ReportingAssistanceNominating & Compensation
Advisory Committee (6 members)

Audit & Supervisory
Committee's Oﬃce

Selection, dismissal,
and supervision

Auditing

Auditing ofaccounts

Cooperation● Progress in implementing the internal control system

ReportingCompliance &CSR Promotion DivisionInternal
auditing(risk management)(deliberation of important matters)

Issuance of instructions
and communication of
information

Observing and guidanceInternal Audit Department■Audit & Supervisory Committee’s Office
Takuma has put in place structures to ensure Audit & Supervisory Committee members can do their jobs effectively by
establishing an Audit & Supervisory Committee’s Office to help carry out the committee’s work.

Education, instructions, and reporting

Divisions and Centers■Nominating & Compensation Advisory Committee

Inside directors

Outside directors■Basic policy on corporate governanceIn order to safeguard and steadily increase the Group’s corporate value over the long term, it is essential not only to ensure
the development of the company’s businesses, but also to clearly define governance in corporate operations—that is, toensure that shareholders’ oversight of operations is carried out appropriately and that officers carry out their operational
responsibilities by means of a process that is clear, rational, efficient, and legally compliant. For that reason, we believe that
understanding the Corporate Governance Code and putting it into practice in an autonomous and systematic manner are
top-priority management issues.

■Board of Directors
As of June 27, 2023, the Board of Directors was comprised of six directors (excluding directors who are members of
the Audit & Supervisory Committee) and five Audit & Supervisory Committee members (of whom four were outside
directors). The Board of Directors meets regularly once a month as a rule and whenever else it is necessary to makedecisions about important issues related to business management and issues established by law and ordinances, aswell as to oversee the execution of the directors’ duties.
Directors: 11 (10 men and 1 woman), including 4 outside directors (3 men and 1 woman)
During FY2022, the Board of Directors complied with internal regulations concerning its discussion and reporting responsibilities
by approving resolutions related to the Company’s basic policies concerning management, matters related to the execution ofimportant operations, and matters designated by law and in the Company’s Articles of Incorporation; by reporting on important
topics outlined in the medium-term management plan, including progress towards achieving KPIs related to the Key Issues(Materiality), initiatives to enhance human capital, initiatives to implement the digital transformation (DX), the general directionof Takuma’s M&A strategy, and R&D themes deemed likely to lead to medium- and long-term business growth; and by offering
feedback on the contents of exchanges of views with investors in the context of Takuma’s IR activities.

■Executive Officers
In order to accelerate management decision-making and clarify where management responsibilities are placed, we have adopted an
executive officer system in which we appoint executive officers who are entrusted with the responsibility of executing our businessactivities. As of June 27, 2023, there were 15 executive officers (including those who also serve as directors). Moreover, we havealso established a Committee of Executive Officers, which is chaired by the president/chief executive officer, as an organization that
deliberates matters that are brought up at meetings of the Board of Directors and other important issues related to the execution of
our business activities. This committee communicates and provides direction about items decided by the Board of Directors andother important items related to the execution of our business activities appropriately to the divisions that are to execute them.

69● Duty to report to the Audit & Supervisory Committee● Duty to develop and administer the internal control system

Internal auditing

Execution of responsibilities

In addition, the committee examined issues surrounding directors’ and executive officers’ execution of their responsibilities,
for example by asking whether the key policies set forth in the medium-term management plan were being appropriately
implemented and by reviewing the following:● Duty of diligence, fiduciary duty, misconduct, etc.

Reporting

Various Committees

Reporting● Progress in implementing the medium-term management plan

● Status of initiatives related to occupational safety and health (including infectious disease measures)

ReportingCommittee of Executive Oﬃcers

Executive Oﬃcers

Appointment
and dismissal

Cooperation

Consultations

Representative Director

Discussion of andreporting onimportant matters

ReportingAccounting Auditors

Supervision
Recommendations

Reporting

We have established an Audit & Supervisory Committee to serve as our auditing structure. That committee, which consistsof five members, of whom four are outside directors, is responsible for accounting and operational audits. Members of thecommittee attend important meetings, including those of the Board of Directors and the Committee of Executive Officers,
and they strive to understand and observe the status of business execution in a timely and appropriate manner. They
express their opinions as necessary, administer self-inspections and evaluations by all executive officers of the internal
control system at year-end, and otherwise conduct strict auditing of the business execution performed by the directors. In
addition, members work together to conduct audits of worksites, departments, and subsidiaries in accordance with audit
policies and other guidelines established by the Audit & Supervisory Committee while exchanging information regularly, forexample by receiving reports from accounting auditors and the Internal Audit Department about topics such as audit plans
and the status of ongoing audits. Members also receive business reports as necessary from subsidiaries as they work tocommunicate and exchange information with those companies’ directors, auditors, and other personnel.
During FY2022, the committee discussed topics including audit policies, audit plans, division of responsibilities, evaluation of
the accounting auditor, development of a consensus on director appointment and remuneration proposals (except for directors
who are members of the committee), and audit report drafts. It also identified the following as key audit items in the audit planand pursued related activities:

We have established the Nominating & Compensation Advisory Committee to increase transparency and objectivity in theselection of candidates for director and executive officer positions and in the determination of the compensation and otherterms so as to enhance the oversight function of the Board of Directors. The Committee includes a total of six members, themajority of whom are independent outside directors: four independent officers (independent outside directors), a representative
director, and the executive officer in charge of human resources. The Nominating & Compensation Advisory Committee, which
reports to the Board of Directors, discusses topics related to executive appointment, dismissal, and compensation as well as
topics related to CEO succession planning. Having received that report, the Board of Directors makes final decisions on related
matters after sufficient discussion while respecting the Committee’s report.
During FY2022, the committee deliberated the following topics and reported to the Board of Directors:● Appointment of executive officers and titled executive officers● Selection of representative directors and titled directors● Nomination of candidates for Board of Directors positions● Establishment of the order in which deputies of the president exercise their authority● Status of the implementation of training of successor human resources● Proposed remuneration packages for executive officers (fixed compensation, bonuses, restricted stock compensation)● Proposed remuneration packages for directors who are not members of the Audit & Supervisory Committee (fixed compensation)

Appointment and dismissal criteria for directors and executive officers
1

Policy on the Appointment and Dismissal of Executives

To maintain an appropriate number of members who can conduct effective discussions and assure that the body can appropriately
carry out its role of decision-making on basic policies and important matters related to the company’s management and supervisionof directors’ and executive officers’ execution of their job responsibilities, Takuma takes various steps to ensure that the Board of
Directors’ membership exhibits a good balance of knowledge, experience, and ability. The Policy on the Appointment and Dismissalof Executives put in place by the Board of Directors establishes appropriate processes for appointing and dismissing executives
along with basic requirements for director candidates and executive officers; criteria for appointing director candidates, executive
officers, and other positions; and criteria for dismissing directors and executive officers.

2

Procedures for appointing and dismissing executives

The Nominating & Compensation Advisory Committee, whose membership consists of independent officers, representative
directors, and the officer in charge of human resources (with a majority of independent outside directors), discusses theappointment and dismissal of directors and executive officers, including the position of president and CEO, in accordance with
the Policy on the Appointment and Dismissal of Executives put in place by the Board of Directors. The Board of Directors makes
final decisions in such matters after sufficient discussion based on factors including directors’ past and present performanceof their responsibilities while respecting reports and advice from the Committee.

Takuma CSR Report 2023

70

Section 02

Governance: Governance Initiatives

ESG Initiatives

Selection criteria for independent officers
Takuma designates all outside officers who satisfy certain qualifications as independent officers.
We assess the independence of outside officers based on standards of independence adopted by the Tokyo
Stock Exchange as well as our own internal Standards for Determining the Independence of Outside Officers.

■Standards for Determining the Independence of Outside Officers

In Takuma’s view, the following individuals do not exhibit sufficient independence to qualify as an independent officer:(1) Individuals/entities whose principal business partner is Takuma*1 and their officers*2(2) Principal business partners of Takuma*3 and their officers(3) Consultants, accounting experts, and legal experts who are receiving financial compensation or other assets in excess ofa certain amount*4 from Takuma, apart from executive compensation (If the entity receiving such assets is an organizationsuch as a corporation or an association, then this criterion refers to individuals belonging to that organization.)(4) Individuals/entities that receive donations or aid in excess of a certain amount*4 from Takuma, apart from executive
compensation (If the entity receiving such assets is an organization such as a corporation or an association, thenthis criterion refers to individuals belonging to that organization.)(5) Major shareholders*5 of Takuma and their officers*1: “Individuals/entities whose principal business partner is Takuma” refers to individuals and entities that earned at least 2% of their consolidated net sales during themost recent business year from Takuma.
*2: “Officers” refers to managing directors, executive officers, and other personnel.
*3: “Principal business partners of Takuma” refers to individuals and entities whose payments to Takuma constituted at least 2% of Takuma’s consolidated net sales
during the most recent business year.
*4: “A certain amount” refers to at least JPY 10 million (for individuals) or at least 2% of gross sales (for organizations) during the most recent business year.
*5: “Major shareholder” refers to an individual or entity that holds at least 10% of the total voting rights.

Evaluation of the effectiveness of the Board of Directors
In order to increase the effectiveness of the Board of Directors, all directors participate in a questionnaire andinterviews about the body’s effectiveness once a year. Those results are then analyzed, evaluated, reported to
the Board by the executive in charge of the evaluation process, and discussed by the Board.
In the FY2022 evaluation, the effectiveness of the Board of Directors was analyzed and evaluated from five
perspectives: the body’s composition, its operation, the responsibilities of its members, its overall effectiveness,and the operation of the Nominating & Compensation Advisory Committee, which was established with the goalof enhancing the Board’s oversight function. This evaluation found that the Board had operated in an effective
and efficient manner and that it was implementing ongoing initiatives to improve its functionality and ensure its
effectiveness, for example by placing discussions on strategic themes from a medium- and long-term perspective
and progress reports on the agenda for Board meetings.
At the same time, recognizing that the evaluation identified the need to ensure sufficient time for participants toreview materials explaining proposed resolutions in advance, the Board will work to further boost its effectivenessby taking action such as distributing some materials earlier than in the past.

Compensation and other remuneration paid to directors-(except Audit & Supervisory Committee members)

1

Matters relating to the General Meeting of Shareholders’ resolution concerning
director compensation and other remuneration

Meeting on June 28, 2016, the 112th Annual General Meeting of Shareholders resolved to limit compensation and other remuneration
paid to directors (except Audit & Supervisory Committee members) to JPY 350 million per year. When the Annual General Meeting of
Shareholders in question ended, there were six directors (not counting Audit & Supervisory Committee members).
Meeting on June 26, 2019, the 115th Annual General Meeting of Shareholders resolved to pay monetary compensation rights not
greater than JPY 90 million per year to directors (except Audit & Supervisory Committee members) for use in acquiring restricted
stock, separate from the above compensation limit. (The resolution limited the total number of shares of Takuma common stock
issued or disposed for this purpose to 120,000 shares per year.) When the Annual General Meeting of Shareholders in question
ended, there were six directors (not counting Audit & Supervisory Committee members).
Meeting on June 28, 2016, the 112th Annual General Meeting of Shareholders resolved to limit compensation and remuneration
paid to directors who are members of the Audit & Supervisory Committee to JPY 72 million per year. When the Annual General
Meeting of Shareholders in question ended, there were four directors that were members of the Audit & Supervisory Committee.

2

Method for formulating policies for determining of compensation and other remuneration

Takuma’s Policy on Executive Compensation and Other Remuneration, which was established by resolution of the Board of Directors,
codifies Takuma’s policies for determining compensation and other remuneration for directors (except Audit & Supervisory Committee
members). The policy is revised as necessary by resolution of the Board of Directors following consultation with, and consideration ofrecommendations submitted by, the Nominating & Compensation Advisory Committee.

3

Policies for determining of compensation

Takuma has adopted the following basic policies concerning the determination of compensation under the Policy on Executive
Compensation and Other Remuneration adopted by the Board of Directors:● Compensation should be suited to the role and responsibilities of the director in question, and it should help the company

secure talented human resources●The compensation system should reflect appropriate consideration of the need to motivate directors to increase fiscal year

performance as well as corporate value over the medium- and long-term●The process used to determine compensation should exhibit transparency and objectivity so that the company can fulfill its

obligation of accountability to shareholders and other stakeholders

71●Compensation system
Compensation for directors and executive officers consists of fixed compensation, bonuses paid according to fiscal year performance,and stock compensation (compensation in the form of restricted stock), which is used to motivate recipients to increase medium- andlong-term corporate value.

Fixedcompensation

Fixed compensation is set depending on the role and responsibilities of each position and paid on a monthly basis.

Bonuses

Takuma has adopted a set of standards for calculating bonuses based on indicators such as fiscal year performance andachievement of targets, and the Board of Directors determines whether to pay bonuses and, if so, in what amount using
those standards as a guide. Bonuses are paid at predetermined times each year. As a general rule, bonuses are capped
at a maximum of 25% of fixed salary (annual amount).

Stockcompensation

Stock compensation takes the form of shares of restricted stock that are granted in advance. Monetary compensationrights set depending on the role and responsibilities of each position are allocated at predetermined times each year, andshares in Takuma are granted in exchange for the pay-in of those rights. As a general rule, stock compensation is capped
at a maximum of 30% of fixed salary (annual amount), with the percentage increasing with seniority of position.

Compensation for outside directors and directors who are Audit & Supervisory Committee members consists of fixed compensation only.

●Procedure for determining compensation
The Nominating & Compensation Advisory Committee, whose membership consists of independent officers, representative directors, andthe officer in charge of human resources (with a majority of independent outside directors), discusses matters related to compensation andremuneration programs, the amount or calculation standard for each director’s compensation and other remuneration, and other executive
officers’ compensation and other remuneration in accordance with the Policy on Executive Compensation and Other Remuneration andreports the results to the Board of Directors. Having received that report, the Board of Directors makes final decisions on related mattersafter sufficient discussion while respecting the Committee’s report.
In determining the amounts of individual compensation packages, the suitability of those packages is verified based on factors including theGroup’s performance, compensation levels for executives at other companies, and employee salary levels.
Compensation for directors who are Audit & Supervisory Committee members and related issues are determined through discussion of directors
who are Audit & Supervisory Committee members, within the scope set forth by the General Meeting of Shareholders.

●Matters related to performance-linked compensation
Because the Group’s business operates primarily on a build-to-order basis and because it considers consolidated ordinary profit to be the mostimportant management indicator, consolidated order value and consolidated ordinary profit serve as key performance indicators in calculating
bonuses that are based on fiscal year performance.
Specifically, a calculation table is used to calculate a coefficient based on the consolidated ordinary profit for the business year in question,
the rate of growth relative to the average consolidated ordinary profit for the most recent three years, the extent to which the consolidated
ordinary profit target has been achieved, and the extent to which the consolidated order value target has been achieved. Bonus amounts
are then determined based on this coefficient. (Consolidated ordinary profit performance figures are calculated before deducting executive
bonuses at companies included in consolidated accounting.) Performance forecasts included in the financial briefing announced in May areused as target values in the evaluation.

●Non-monetary compensation and other remuneration
Takuma offers directors stock compensation in the form of shares of restricted stock as a medium- and long-term incentive and as a means ofsharing shareholder value. Transfer is restricted for a period of 30 years from the date on which the allocation of Takuma common stock is made,and the restriction is removed when that period ends or if the individual in question passes away, completes his or her term, retires, or otherwise
ends his or her involvement with the company before the period ends for a legitimate reason approved in advance by the Board of Directors.

●Total amounts of compensation and other remuneration for directors (FY2022)
Executive category

Total compensationand other remuneration(millions of yen)

Total compensation and other remuneration by type (millions of yen)
Number of
Non-monetary
Performance-linked
executives
Basic
compensation
andcompensation
andincludedcompensation
other remuneration
other remuneration

Director (except Audit & Supervisory Committee member)

273

189

Director (Audit & Supervisory Committee member) (outside director)

54（33）

54（33）

45

39

6
6（5）

*Performance-linked compensation and other remuneration consists of bonuses awarded to directors (except Audit & Supervisory Committee members).
*Non-monetary compensation and other remuneration consists of shares of restricted stock granted to directors (except Audit & Supervisory Committee members).

Internal controls
Takuma has adopted a Basic Policy for Establishment of an Internal Control System in accordance with theCompanies Act. We continue to review and improve this policy in response to changing circumstances. Working
towards thorough compliance, Takuma built a compliance promotion organization in FY2006 in order to continuously
implement enlightenment and educational activities that make corporate ethics, related laws and ordinances, andinternal rules fully understood. To control the danger of loss, we have also prepared a “Risk Management Code” that
determines the person in charge of each risk, and we set up our risk management organization according to that
Code. When the unexpected occurs, emergency headquarters are established with the company president as
the director in charge of risk management, and an organization is put in place in order to minimize and prevent
further damage through prompt action.
Internal controls, constructed and evaluated in order to report on and prevent misstatements in our financial
reporting, are based on the Financial Instruments and Exchange Act. These internal controls on financial reportingfor the Group have resulted in reports that indicate this system has been effective.
In this way, we will continue to work in the future to ensure thorough compliance while carrying out businessproperly and efficiently while also deepening risk management.

Takuma CSR Report 2023

72

Section 02

Governance: Governance Initiatives

ESG Initiatives

Executive Profiles(As of June 27, 2023)

Directors
President and Representative Director & Chief Executive Oﬃcer

Hiroaki Nanjo
April 1982
April 2009
September 2010
April 2013

April 2014
June 2015
April 2016
April 2018
April 2019

Joined the Company
General Manager of Environmental Engineering Department 1, Project Center, Engineering Group
General Manager of Energy Engineering Department 1, Project Center, Engineering Group
Executive Oﬃcer of the Company
Deputy Executive Manager of Project Center,
Engineering Group and General Manager of Energy Engineering Department 1
Executive Manager of Project Center, Engineering Group
Director & Executive Oﬃcer of the Company
Director & Managing Executive Oﬃcer of the Company
Executive Manager of Engineering Group and Executive Manager of Management Center
Director & Senior Managing Executive Oﬃcer
President and Representative Director & Chief Executive Oﬃcer (up to the present)

Director & Senior Managing Executive Oﬃcer

Tsuyohito Nishiyama
April 1985
April 2012
April 2014
April 2015

April 2016
June 2016
April 2018
April 2019

Joined the Company
General Manager of Project Administration Department 1,
Business Administration Division, Corporate Marketing Group
General Manager of Corporate Planning Department, Corporate Planning & Administration Division
Executive Oﬃcer of the Company
Deputy Executive Manager of Corporate Planning &Administration Division and General Manager of Corporate Planning Department
Executive Manager of Corporate Planning & Administration Division
Director & Executive Oﬃcer of the Company
Director & Managing Executive Oﬃcer of the Company
Director & Senior Managing Executive Oﬃcer (up to the present)
Executive Manager of Corporate Marketing Group and Executive Manager ofBusiness Administration Division (up to the present)

Director & Senior Managing Executive Oﬃcer

Hideki Takeguchi
April 1985
April 2012
April 2014
April 2015

April 2016
June 2016
April 2018
April 2019

Joined the Company
Deputy General Manager of Environmental Engineering Department 1,
Project Center, Engineering Group
General Manager of Environmental Engineering Department 1, Project Center, Engineering Group
Executive Oﬃcer of the Company
Deputy Executive Manager of Project Center,
Engineering Group and General Manager of Environmental Engineering Department 1
Executive Manager of Project Center, Engineering Group
Director & Executive Oﬃcer of the Company
Director & Managing Executive Oﬃcer of the Company
Director & Senior Managing Executive Oﬃcer (up to the present)
Executive Manager of Engineering Group and
Executive Manager of Management Center (up to the present)

Director & Managing Executive Oﬃcer

Koji Tanaka
April 1986
April 2009
August 2011
April 2014
April 2017

June 2017
April 2018
April 2021

June 2021

Joined the Company
Deputy General Manager of European Operations Department, Corporate Planning & Administration Division
General Manager of Corporate Planning Department, Corporate Planning & Administration Division
General Manager of Human Resources Department, Corporate Services Division
Executive Oﬃcer of the Company
Executive Manager of Compliance & CSR Promotion Division, Executive Manager ofCorporate Services Division and General Manager of Legal Aﬀairs Department
Director & Executive Oﬃcer of the Company
Executive Manager of Compliance & CSR Promotion Division, Executive Manager of Corporate Services Division
Director and Managing Executive Oﬃcer (up to the present)
Executive Manager of Corporate Marketing Group and International Division
Executive Manager of Compliance & CSR Promotion Division
Executive Manager of Corporate Marketing Group and International Division (up to the present)

Director & Managing Executive Oﬃcer

Kunio Hamada
July 1990
April 2012
June 2013
April 2018

April 2021
June 2021
April 2022

Joined the Company
Deputy General Manager of Cost Control & Project Administration Department,
Management Center, Engineering Group
General Manager of Cost Control & Project Administration Department, Management Center, Engineering Group
Executive Oﬃcer of the Company
Deputy Executive Manager of Corporate Planning &Administration Division and General Manager of Corporate Planning Department
Executive Manager of Corporate Planning & Administration Division (up to the present)
Director & Executive Oﬃcer of the Company
Director & Managing Executive Oﬃcer (up to the present)

Mr. Hiroaki Nanjo has mainly been engaged in the
Planning Technology Division, and currently
supervises the overall management as Chief
Executive Officer, after serving as a Director &Senior Managing Executive Officer and Executive
Manager of the Engineering Group. He
possesses abundant experience and knowledge
regarding the operations and management of theCompany. The Company proposes his
re-appointment as a candidate for Director as it
expects that he will play an appropriate role indetermining important management matters andmanagement supervision for the sustainableimprovement of the corporate value of the Grouputilizing this experience and knowledge.
Mr. Tsuyohito Nishiyama has mainly been
engaged in the Business Administration Division,
the Marketing Division, and the Corporate
Planning & Administration Division, and currently
serves as a Senior Managing Executive Officer
and Executive Manager of Corporate MarketingGroup that supervises overall marketing. He
possesses abundant experience and knowledge
regarding the operations and management of theCompany.

Mr. Hideki Takeguchi has mainly been engaged in
the Planning Technology Division, and currently
serves as a Senior Managing Executive Officer
and Executive Manager of the EngineeringGroup, which oversees engineering. He
possesses abundant experience and knowledge
regarding the operations and management of theCompany.

Mr. Koji Tanaka has mainly been engaged in the
Information Systems Division, neutral divisions
such as human resources, Corporate Planning &Administration Division and the International
Division, and currently serves as Managing
Executive Officer and Executive Manager of the
Corporate Marketing Group and International
Division, which is responsible for the Company’s
overseas business. He possesses abundant
experience and a wide range of knowledge
regarding operations and management of theCompany.

Mr. Kunio Hamada has mainly been engaged in
the engineering division and cost management
division, and currently serves as Managing
Executive Officer and Executive Manager of the
Corporate Planning & Administration Division
responsible for finance and formulation andimplementation of corporate plans. He
possesses abundant experience and a wide
range of knowledge regarding the operations andmanagement of the Company.

Director (Standing Audit & Supervisory Committee Member)

Keizo Masugi
January 2001
April 2014
April 2016
April 2018
April 2021
June 2021

Joined the Company
General Manager of Accounting Department, Corporate Planning & Administration Division
General Manager of Corporate Planning Department, Corporate Planning & Administration Division
General Manager of General Aﬀairs Department and General Manager of Legal Aﬀairs Department,
Corporate Services Division
Assistant General Manager of Audit & Supervisory Committee s Oﬃce
Director (Standing Audit & Supervisory Committee Member) of the Company (up to the present)

Outside Director (Audit & Supervisory Committee Member)Tomomi Fujita
October 2004
January 2012
March 2016
April 2016
February 2017
April 2018
June 2019
June 2019
February 2020
April 2022
June 2023

Registered as Attorney at Law (Osaka Bar Association)
Joined Kitahama Partners
Partner of Kitahama Partners
Left Kitahama Partners
Founded InnoventierPartner of Innoventier (up to the present)
Director, Licensing Executive Society JAPANAssistant Lecturer of Kyoto University Law School
Director (Audit & Supervisory Committee Member) of the Company (up to the present)
Outside Auditor of TAIYO YUDEN CO., LTD. (up to the present)
Vice President of Licensing Executives Society JAPAN (up to the present)
Visiting Professor of Kyoto University Law School (up to the present)
Registered attorney (California, U.S.A.)

Outside Director (Audit & Supervisory Committee Member)

Tetsuya Kaneko
April 1981
September 2000
April 2002
November 2004
April 2005
April 2008
April 2010
July 2010
July 2010
November 2010
May 2011
June 2011
June 2014
June 2019
June 2020
June 2023

Joined The Dai-Ichi Kangyo Bank, Ltd. (currently Mizuho Bank, Ltd.)
Deputy General Manager of Singapore Branch, The Dai-Ichi Kangyo Bank, Ltd.
Deputy General Manager of Singapore Branch, Mizuho Corporate Bank, Ltd. (currently Mizuho Bank, Ltd.)
Associate Director of International Administration Department, Mizuho Corporate Bank, Ltd.
General Manager of Yokohama Sales Department, Mizuho Corporate Bank, Ltd.
General Manager of International Sales Promotion Department, Mizuho Corporate Bank, Ltd.
Deputy Director of Human Resources Management Department, Mizuho Corporate Bank, Ltd.
Deputy Director of Corporate Planning Department, Mizuho Financial Group, Inc.
Senior Executive Oﬃcer; General Manager of Education Business Department,
Mizuho Research Institute Ltd. (seconded)
Senior Executive Oﬃcer; General Manager of Education Business Department,
Mizuho Research Institute Ltd.
Left Mizuho Research Institute Ltd.
Director of KANEMATSU CORPORATIONManaging Executive Oﬃcer of KANEMATSU CORPORATION
Resigned from KANEMATSU CORPORATION
Standing Auditor, Yushu Building Co., Ltd. (currently Yushu Corporation)
Director (Audit & Supervisory Committee Member) of the Company (up to the present)
Representative Director and President, Yushu Corporation
Resigned, Yushu Corporation

Outside Director (Audit & Supervisory Committee Member)

Seiichi Nagatsuka

April 1980
Joined the Ministry of International Trade and Industry (currently the Ministry of Economy, Trade and Industry)
September 1984 Studied at graduate school of Economics, Brown University, U.S.A. (where he earned a master's degree)
May 1994
Director of Trade Research Oﬃce, Trade Policy Bureau,
the Ministry of International Trade and Industry (currently the Ministry of Economy, Trade and Industry)
May 1995
Ministry of Foreign Aﬀairs (seconded)Counselor of the Permanent Mission of Japan to the International Organizations in Geneva(with responsibility for the WTO)
June 1998
Director of Trade Research Division, Trade Bureau, the Ministry of Economy, Trade and Industry
June 1999
Deputy Director of Commerce, Industry, and Labour Department, Miyazaki Prefectural Government (seconded)
January 2001
Director of Macro Economic Aﬀairs Division, Economic and Industrial Policy Bureau,
the Ministry of Economy, Trade and Industry
July 2003
Director of Automobile Division, Manufacturing Industries Bureau, the Ministry of Economy, Trade and Industry
September 2005 Trade Negotiator, Trade Policy Bureau, the Ministry of Economy, Trade and Industry
October 2007
Trustee, Japan International Cooperation Agency (JICA)
August 2009
Deputy Director-General of Manufacturing Industries Bureau, the Ministry of Economy, Trade and Industry
July 2010
Director-General, Kansai Bureau of Economy, Trade and Industry, the Ministry of Economy, Trade and Industry
August 2011
Director-General, Commerce and Information Policy Bureau, the Ministry of Economy, Trade and Industry
June 2013
Retired from the Ministry of Economy, Trade and Industry
October 2013
Advisor to Mitsui Sumitomo Insurance Co., Ltd.
May 2014
Vice Chairman and Senior Managing Director of Japan Automobile Manufacturers Association, Inc. (up to the present)
June 2022
Director (Audit & Supervisory Committee Member) of the Company (up to the present)

Outside Director (Audit & Supervisory Committee Member)
Director & Managing Executive Oﬃcer

Hiroshi Oishi
April 1988
January 2008
January 2013
April 2013
April 2016
August 2019
April 2021
June 2021
April 2023

73

Joined The Dai-Ichi Kangyo Bank, Ltd. (currently Mizuho Bank, Ltd.)
Deputy General Manager of Human Resources Department, Mizuho Securities Co., Ltd.
Deputy General Manager of Corporate Planning Department
General Manager of Securities & Trust Promotion Department, Mizuho Bank, Ltd.
General Manager of Customer Service Department andGeneral Manager of Management Department, Mizuho Financial Group, Inc.
Executive Oﬃcer of the Company
Deputy Executive Manager of Energy Plant Division, Corporate Marketing Group
Executive Manager of Corporate Services Division (up to the present)
Director & Executive Oﬃcer of the Company
Director & Managing Executive Oﬃcer (up to the present)

Masahiro Endo
Since joining The Dai-Ichi Kangyo Bank, Ltd.
(currently Mizuho Bank, Ltd.), Mr. Hiroshi Oishi
engaged in various operations at the bank and its
group companies including deposits, moneytransfers, loans, currency exchange, businessplanning, human resources, and customer
service. At the Company, he has engaged in
product and service sales in the marketing
division, and currently serves as Managing
Executive Officer and Executive Manager ofCorporate Services Division responsible forgeneral affairs and human resources. He
possesses abundant experience and a wide
range of knowledge regarding the operations andmanagement of the Company.

October 1985
March 1989
May 1989
August 1997
June 2007
July 2007
June 2015
December 2020
June 2022
June 2023

Joined Nisshin Audit Corporation (currently Ernst & Young ShinNihon LLC)
Registered as a certiﬁed public accountant
Registered as a licensed tax accountant
Partner, Century Audit Corporation (currently Ernst & Young ShinNihon LLC)
Left Century Audit Corporation
Representative, Endo Certiﬁed Public Accountant Oﬃce (up to the present)
Outside Auditor, Sakurajima Futo Kaisha, Ltd.
Representative Director, Kobe Audit Corporation (up to the present)
Director (Audit & Supervisory Committee Member) of the Company (up to the present)
Resigned, Outside Auditor, Sakurajima Futo Kaisha, Ltd.

Mr. Keizo Masugi has mainly been engaged in the
Accounting Department, Corporate Planning and
Administration Division, General Affairs
Department, and Legal Affairs Department, andcurrently serves as a Standing Audit &Supervisory Committee Member.

Ms. Tomomi Fujita is involved in the managementof the law firm Innoventier as Partner whileserving as Vice President of the Licensing
Executive Society JAPAN and Visiting Professor
at Kyoto University Law School. She possesses
abundant experience and expertise regarding
corporate law covering intellectual property,business revitalization, M&As, and theCompanies Act. In addition to serving as an
Outside Director who is an Audit & Supervisory
Committee Member of the Company, she serves
as an Outside Auditor for a listed company. She
possesses knowledge of financial andaccounting matters through her experience inthese duties.

Mr. Tetsuya Kaneko has served as Director andManaging Executive Officer at the global
company KANEMATSU CORPORATION, formany years. He possesses abundant experienceand knowledge on corporate management, andhe has served as an Audit & Supervisory Board
member and Audit & Supervisory Committee
member at a number of private-sector
companies, including Takuma. In addition tohaving extensive experience and knowledge in
the areas of auditing and supervision, he gained
extensive knowledge on overseas business fromhis abundant experience working overseas while
he was serving at The Dai-Ichi Kangyo Bank, Ltd.
(currently Mizuho Bank, Ltd.).

Mr. Seiichi Nagatsuka has held numerous
important posts since he joined the Ministry ofInternational Trade and Industry (currently the
Ministry of Economy, Trade and Industry), andwith experience serving at the Permanent
Mission of Japan to the International
Organizations in Geneva and the Japan
International Cooperation Agency (JICA), he iswell versed in overseas business. Mr. Nagatsuka,
who currently serves as Vice Chairman andSenior Managing Director at the Japan
Automobile Manufacturers Association, Inc., also
has extensive experience and knowledge in theareas of industrial policy and trade policy.

After participating in the auditing of publicly listedcompanies as a certified public account for many
years at what is now Ernst & Young ShinNihon
LLC, where he later became a partner, Mr.
Masahiro Endo became the representative ofEndo Certified Public Accountant Office in July
2007. In December 2020, he founded Kobe Audit
Corporation, where he serves as therepresentative director, and he possesses
abundant experience and expert knowledge on
finance and accounting as well as abundant
experience and knowledge on audit andsupervision, including experience serving as an
outside Audit & Supervisory Board member atpublicly listed companies.

Takuma CSR Report 2023

74

Section 02

Governance: Governance Initiatives

Messages from Outside Directors

Director’s skills matrix
Skill sets necessary for the Board of Directors of the Company
Name

Position at
TakumaNumber ofyears serving
as a director

Engineering(technology,
Corporatequality,and cost
management

Hiroaki
Nanjo

President &Representative
Director

Tsuyohito
Nishiyama

Director &SeniorManaging
Executive
Officer

7●

HidekiTakeguchi

Director &SeniorManaging
Executive
Officer

7●

Koji
TanakaDirector &Managing
Executive
Officer

6

●

Kunio
HamadaDirector &Managing
Executive
Officer2●

Hiroshi
Oishi

Director &Managing
Executive
Officer2

Keizo
Masugi

Director(Audit &Supervisory
Committee
Member)2

Tomomi
FujitaOutsideDirector(Audit &Supervisory
Committee
Member)4●

Tetsuya
KanekoOutsideDirector(Audit &Supervisory
Committee
Member)3●

SeiichiNagatsuka

OutsideDirector(Audit &Supervisory
Committee
Member)1

Masahiro
Endo

OutsideDirector(Audit &Supervisory
Committee
Member)1

8●

management)

Sales andbusinessstrategies●●

Attendanceat Board of
Directors
meetings
duringFY2022

Attendanceat Audit &Supervisory
Committee
meetings
duringFY2022

Attendance at
Nominating &Compensation
Advisory
Committee
meetings
duringFY202217 of 17
(100%)-

2 of 2(100%)

17 of 17
(100%)--

17 of 17
(100%)--

17 of 17
(100%)--

17 of 17
(100%)--●

17 of 17
(100%)-

2 of 2(100%)●

17 of 17
(100%)

18 of 18
(100%)-●

17 of 17
(100%)

18 of 18
(100%)

2 of 2(100%)

Outside Director (Audit & Supervisory Committee Member)●17 of 17
(100%)

18 of 18
(100%)

2 of 2(100%)●

13 of 13
(100%)

13 of 13
(100%)

1 of 1(100%)

When I became an outside director in 2020, the COVID-19 pandemic hadjust begun, with the result that many meetings were held online, and it was
impossible for me to visit various sites as I had planned. Fortunately, I wasable to deepen my understanding of the company during FY2022 as thenumber of real, in-person meetings grew, and I was able to visit some of
the company’s sites.

International Finance andoperations accounting

●

●

●

Human
Legal affairs,
resources,
compliance,
talentand riskdevelopment,
managementand diversity

●

●

●

●

●

●

●

●

●

●

●

●

●

13 of 13
(100%)●

13 of 13
(100%)

1 of 1(100%)

Executive officers (excluding those who also serve as directors)
Managing Executive Officer
Executive Manager,
Energy Plant Division

Managing Executive Officer
Executive Manager,
Technology Center

Akira Taguchi

Hidetoshi Tomita

Managing Executive Officer
Executive Manager,
Project Center

Managing Executive Officer
Executive Manager,
Construction Center

Executive Officer
Executive Manager,
Compliance & CSR Promotion Division

Executive Officer
Executive Manager,
Engineering Center

Executive Officer
Deputy Executive Manager,
Energy Plant Division

Executive Officer
Deputy Executive Manager,
Construction Center

Mitsuaki Adachi

Kiyoshi Shibata

75

FY2023 is the final year of the 13th Medium-Term Management Plan
(FY2021 to FY2023).
The world changed dramatically during FY2021 and FY2022 due to the
COVID-19 pandemic and geopolitical developments including the crisis
between Russia and Ukraine, but Takuma managed to listen seriously to
its customers and steadily advance its business despite those challenges.
In addition, as the importance of initiatives addressing climate change,
human capital, and diversity grows as part of a trend highlighted by the
mandatory inclusion of sustainability disclosures in financial reports
starting in FY2023, Takuma is actively tackling priorities in those areas
in keeping with its Company Motto of “Value Technology, Value People,
Value the Earth”.
This fiscal year, we will continue to advance our businesses while resolving
a variety of challenges as we work to achieve the goals set forth in the 13th
Medium-Term Management Plan.
I believe that having an effective Board of Directors is an essential
prerequisite in order to advance the company’s business while operating
it in an appropriate manner, and I am happy to report that Takuma’s
Board of Directors, which is comprised of people representing a varietyof backgrounds, fosters animated discussions.
Evaluations of the Board’s effectiveness and other tools have establishedthat we are playing the functions expected of us, even as we strive to
become a more effectively body.
I look forward to helping increase Takuma’s corporate value by fulfilling myrole as an outside director.

Tomomi Fujita*The above chart does not include all knowledge and experience brought to Takuma by its directors.

Norio Maeda

ESG Initiatives

Keiji Nakamura

Masayuki Sugita

Managing Executive Officer
Executive Manager,
Environmental Plant Division

Yasushi Enomoto

Junichi Hashimoto

In particular, those site visits allowed me to come into direct contact with
Takuma’s extensive technological capabilities and dynamic energy, and I was
also able to listen directly to some of the challenges faced by those sites. I feelthat as I draw on the knowledge gained from site visits while participating
in discussions by the Board of Directors and other bodies, I am able tooffer frank opinions concerning the company’s overall direction, the issues
with which it is grappling, and the solutions being undertaken in a way thatis consistent with my understanding of its worksites.
As the importance of the ESG perspective grows, I look forward tocontinuing to pour all my energy into thinking about how Takuma’s
technology can contribute most effectively and how it can increase themagnitude of that contribution. It may be necessary to promote Takuma’scontribution to resolving environmental issues more assertively.
With the new TAKUMA Building (Training Center) opening, constructionof the new Harima Factory reaching completion, and the number of
mid-career hires growing, we are also focusing on bolstering Takuma’s
human resources. As we pursue numerous long-term projects, thebenefits of those efforts will not appear in the company’s performance
numbers overnight, but I believe that the mission we have been given is
to explore how we can leverage these investments most effectively sothat they function to augment medium- and long-term growth. And I feelthat Takuma has the ability to do that.

Tetsuya Kaneko
Outside Director (Audit & Supervisory Committee Member)

Takuma CSR Report 2023

76

Section 02

Governance: Governance Initiatives

Strengthening risk management

Fair business practices

Risk management structure

Compliance measures

We consider it necessary to appropriately
address risks that could interfere with thegroup’s achievement of its business goals sothat we can safeguard and steadily increase
our corporate value over the long term.
Takuma follows a “Risk Management Policy”
that connects company-wide risks andseparately classifies them into projectrisks related to our core business, i.e.,
plant construction; DBO project risks and
DBO project operation, maintenance andmanagement risks related to our DBO
business; and potential risks, actualizedrisks, and financial reporting risks related
to other corporate business activities.
Group companies also work to develop andstrengthen approaches to risk management
through the Takuma Group Coordinating
Committee for Compliance & CSR Promotion.

[Initiatives to ensure compliance with the Antimonopoly Act]

Risk Management Policy
Basic purpose of risk management
Risk refers to all phenomena that interfere with the Group’s ability toachieve its business objectives or cause losses or harm to the interestsof stakeholders.
The Takuma Group practices risk management with the goal of increasing
its corporate value by working to maximize returns while minimizing thenegative impacts of risk.

Towards ensuring permanent compliance with the Antimonopoly Act, Takuma enacted “Regulations Concerning Managementof the Pledge of Antimonopoly Act Compliance”, which provides for the submission of a written oath in regard to observing the
Antimonopoly Act. When employees interact with the sales department of a competitor, they must apply and receive approval
from the affiliated division or center manager in advance to ensure fair business contact.

[Introducing a Legislation Information Service]
Takuma has introduced a Legislation Information Service in order to gain a continuous grasp of the latest changes to laws andordinances.

[Utilizing the Compliance Manual]

Risk management action guidelines
1. The president and CEO is responsible for risk management at Takuma.
2. All officers and employees participate in risk management activities.
3. Risk management activities are carried out in accordance with applicableguidelines such as the Risk Management Code.
4. Risk management activities are carried out in line with the medium-term
management plan and annual plan, and we work to make improvements
on an ongoing basis.
5. When risk manifests itself, we respond by taking responsible action
quickly to minimize any damage and creating provisional organizational
entities as necessary.
6. Group companies carry out risk management activities in accordancewith their own policies and plans, with support from Takuma.

Business continuity plan (BCP)
In addition to formulating a “BusinessContinuity Plan” based on the policies listed
to the right to ensure proper and appropriate
continuity of business operations in the eventof a large-scale disaster, pandemic, or otheremergency, Takuma conducts exercises on aregular basis.

1. In addition to implementing disaster-related measures to secure thesafety of corporate officers and employees, maintain structures so as
to enable continuity of business operations while minimizing damage
in an emergency.
2. Strive to respond to customer needs and recover from damage quickly
by working closely with suppliers and partner companies to maintainbusiness operations.
3. Earn the trust of numerous stakeholders, including employees, theirfamilies, shareholders, and nearby residents, and fulfill social needs
by maintaining business operations.

We distribute a Compliance Manual that includes an explanation of the rules and standards of conduct as well as an FAQ to
all employees in accordance with Takuma Group Ethics Charter and Takuma Group Code of Conduct. This manual is utilized
in the course of daily operations and departmental training.

Compliance & CSR promotion education
Takuma offers compliance and CSR promotion education
through the Compliance & CSR Promotion Organization,
which was established in order to spread awareness ofcompliance and CSR issues among employees.
We offered the following five compliance and CSR
promotion education sessions during FY2022. In addition,in October 2022, we invited an outside expert instructor togive an internal talk on CSR for executives.

Number ofsessions

Committee of
Executive Officers

President

Compliance & CSR Promotion Organization
Chairman(Executive Manager of the Compliance & CSR Promotion Division)

Secretariat (CSR Department)

Divisions and Centers
Compliance &CSR Promotion Administrator
Department(division or center manager)

Compliance & CSR Promoters (department manager)
Staff members

Enlightenment/
education

Compliance & CSR promotion structure

Takuma Group

77

Board of Directors

Coordinating Committee for Compliance & CSR Promotion

Additionally, we established the Takuma Group Coordinating Committee
for Compliance & CSR Promotion, which brings together representativesof group companies to help ensure that compliance and risk management
are implemented throughout the group.

Number of
departments

49

October 27, 2022

Lecturetheme

Business and Human Rights, Environment,
and Climate Change for Japanese Corporations andTheir Response to ESG Issues

Lecturer

Japan Center for Engagement and Remedy on
Business and Human Rights (JaCER)
Representative Director Attorney at Law(Japan and New York, USA) Sakon Kuramoto

Cumulative
number of trainees

6,074

Takuma has been operating an internal reporting systemsince FY2006, with the aim of promoting compliancemanagement by uncovering illegal or unfair acts as earlyas possible and undertaking corrective measures.

Compliance & CSR promotion structures

The initiative includes an annual regular meeting at which Compliance &CSR Promotion Administrators discuss the state of compliance and CSR
promotion throughout the company as well as quarterly departmental
meetings at which Compliance & CSR Promoters are given training tohelp them better carry out related activities in their departments.

Date

Internal reporting system

Ensuring complianceThis organization is composed of a chairman (the Executive Manager of
the Compliance & CSR Promotion Division), a secretariat (positioned in the
CSR Department), and an executing organization in each division, center,and department. As the person in charge of promoting compliance andCSR in his or her division or center, each division or center manager isappointed as a Compliance & CSR Promotion Administrator. As persons
who implement enlightenment and education in compliance and CSR in
their respective departments, department managers are appointed as
Compliance and CSR Promoters.

CSR lecture for executives

First session: Insider Trading; Accident Reduction andCorporate Disaster Resilience
Second session: Learning about Unconscious Bias
Third session: Basics of Security Export Controls 2022
Fourth session: Corporate Scandals:
Personal Corruption vs.
Organizational Corruption
Special training: Preventing Harassment at Worksites and
Takuma’s Internal Reporting System
5 per year

Takuma established the Compliance & CSR Promotion Organization to
spread awareness of compliance and CSR issues among employees.

ESG Initiatives

Reporting contacts are set up at our Compliance & CSR
Promotion Division and at a law office, as well as a dedicatedoutside reporting hotline for anonymous e-mail reporting.
During FY2020, the Audit & Supervisory Committee was added
as an internal contact to further increase the effectiveness of
the internal reporting system. Our “Internal Reporting Code”
and “Takuma Group Code of Conduct” further declare thatno informant shall be subjected to disadvantageous treatment
simply because he or she filed a report or cooperated with aninvestigation.
Furthermore, in order for this system to be correctly
understood and utilized, we distribute a card to all
employees with information on the reporting contacts.

Internal reporting process
Persons seeking consultation or making reports
Response

Consultation
or report

Compliance &CSR Promotion
Division

Audit &
Supervisory
Committee

Law oﬃce

Outsidereportingcompany(Including via
anonymouse-mail if sodesired)Cooperation

Internal investigation departments

CSR awareness survey
We conduct an annual CSR awareness survey in order to quantitatively assess the level of compliance and CSR awarenessalong with the effectiveness of related promotional and educational efforts. The results of this survey are used whensummarizing the activities of each fiscal year and in formulating the upcoming year’s action plan, as well as in futurecompliance and CSR promotion activities. We make active use of survey results, for example by offering additional
education, particularly in areas that received lower scores than in the previous survey.

Takuma CSR Report 2023

78