To Create a Vibrant Environment for
All Members of Society
The Taisei Group creates “safe, secure, and attractive spaces” and“high value” in harmony with the nature, and strives to build a global society
filled with dreams and hopes for the next generation.

Taisei Spirit

Taisei Group Philosophy
Taisei Group
Philosophy

To Create a Vibrant Environment for
All Members of Society

Active and Transparent Culture /Value Creation / Evolution of Tradition
Key Concepts That All Taisei Group Officers andEmployees Must Adhere to in Order to Pursue andRealize the Taisei Group Philosophy

Objectives to be Pursued by the Taisei Group (Goals)

Taisei Spirit
Action Guidelines for Taisei
Personnel and the Taisei Group
as a Whole
Individual Policies

Customers

Overall
Principles ofConduct

Shareholders / Investors

Suppliers

OverallManagement
Perspective

Medium-term Business Plan
(FY2018 – FY2020)

Employees

Local Communities

In order to pursue the Taisei Group Philosophy “To Create a Vibrant Environment for All Members of Society,”
all officers and employees share the “Taisei Spirit,” and carry out corporate actions based on the Group Action
Guidelines and Individual Policies “Overall Principles of Conduct” and “Overall Management Perspective” andMedium-term Business Plan. The aim is to create new social value in the course of these actions through thewishes and expectations of our stakeholders, while being aware of the issues of sustainable society andcontributing towards their resolution.

1 T A I S E I A NNUA L R EPORT 2019

Group Slogan**The Taisei Group Philosophy, the Taisei Spirit and the Action Guidelines for Taisei Personnel and the Taisei Group
as a Whole can be summed up in the following slogan.

Action Guidelines for Taisei Personnel
and the Taisei Group as a Whole

Taisei Spirit
Active andTransparent
CultureWe value diversity and, through open and active communication lines
and networks both internal and external to the Taisei Group, seek tocultivate a transparent and active corporate culture in which all of ourofficers and employees are able to reach their full potential.

❶ Cultivating an open corporate culture●

Value
Creation

Not limited to our understanding of society at large, we carefully take into
account the needs of our clients and using all of the technology andknow-how at our disposal, together with our passion for innovation andingenuity, seek to construct innovative and valuable engineering projects
that inspire and impress our clients.

❹ Creating a vibrant environment for all●
members of society

We aim to instill within the Taisei Group the Japanese tradition ofmonozukuri (precise, superb craftsmanship) and continually challenge
ourselves to provide ever more valuable contributions to society and ensure
our continued development and growth as a respected corporate group.

❽ Respect for traditions

EvolutionofTradition❷ Securing a pleasant working environment●❸ Respect for fundamental human rights●
and diversity❺ Striving to create value●❻ Pursuing customer satisfaction❼ Ensuring and improving safety and quality●❾ Promoting partnerships with subcontractors●
and suppliers❿ Promoting environmental conservation●and creation⓫ Communication with local communities●⓬ Conduct in the international community●⓭ Appropriate disclosure of information●⓮ Fulfilling social responsibilities●

Individual Policies⃝Risk Management Policy⃝Policy on the Protection of
Personal Information⃝Policy on Business Continuity inTimes of Disaster⃝Information Disclosure Policy⃝Quality Policy⃝Policy on Intellectual Property⃝Health and Safety Policy⃝Declaration of Biodiversity
Preservation⃝Environmental Policy⃝Environmental Targets⃝Policy on Intellectual Property⃝Human Rights Policy⃝Fundamental Corporate Governance Policy⃝Fundamental Policy to Enhance Operational
Compliance Systems⃝Code of Conduct on the Use of Social Media⃝IR Policy⃝Social Contribution Policy

TA I SE I A N N UA L R E P O R T 2 0 1 92

This report is intended to help readers better understand the creation of our corporate value as a whole,such as corporate activities, financial statements, and management tasks in line with the Taisei Group
Philosophy and the Action Guidelines for Taisei Personnel and the Taisei Group as a Whole.
This report comprehensively and concisely discloses our key ESG information that provides starting
points for dialogues, including the President’s talks and External Board Members’ discussion, and SDGs dialogue, as wellas our initiatives on sustainability.
Further details about the initiatives related to ESG and sustainability are available in the “CSR” section on Taisei
Corporation’s official website.

Editorial Policy

WEB

https://www.taisei.co.jp/english/csr/<Supplementary Note on Employees>• “Employee” refers to employees of Taisei Corporation. “Personnel” refers to personnel working at Taisei Corporation,
including dispatched and seconded personnel.
• “Officers and personnel” collectively refers to Members of the Board, Executive Officers, Executive Fellows, andemployees of Taisei Corporation.

Period of Coverage

The main subject of this report is the actual results for the fiscal year ended March 31, 2019 (April 1, 2018 to March 31, 2019).
Some contents concern the data for the previous fiscal year or the most recent activities.
Scope of Coverage
In principle this report covers the activities of Taisei Corporation and the Taisei Group companies (consolidated
subsidiaries) as of March 31, 2019, unless otherwise noted.
Guidelines on Non-Financial Information Disclosure• GRI Sustainability Reporting Standards• ISO26000: 2010 (International Organization for Standardization)• Integrated Reporting Framework (International Integrated Reporting Council: IIRC)• Environmental Reporting Guidelines (2018)• Guidance for Collaborative Value Creation (METI)
Third-party opinions and third-party assurance on this report• Kanji Tanimoto, DBA, Professor, School of commerce, Waseda university• “Independent Assurance Report” on the environment data and indices by Ernst & Young ShinNihon LLC
Date of Issue• September 2019

Composition of Communication Materials ●Japanese ●English

Publications

WebsiteInvestor Relations Information ● ●https://www.taisei.co.jp/english/ir/

TAISEI ANNUAL REPORT2019 ● ●CSR Activities (Sustainability): ● ●https://www.taisei.co.jp/english/csr/(Integrated Report)

Amount of information
ESG Evaluation (As of July 1, 2019)

INCLUSION OF TAISEI CORPORATION IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS ORINDEX NAMES HEREIN,
DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT OR PROMOTION OF TAISEI CORPORATION BY MSCIOR ANY OF ITS AFFILIATES. THE MSCI INDEXES ARE
THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.

3 T A I S E I ANNUA L R EPORT 2019

MoreSpecial Feature:
Engagement to Increase
Corporate Value
23 Special Feature 1<Talk> President and Investor

55 Social• Ensuring Quality and Improving Technology• Technical Development for Realizing a
Sustainable Society• Promotion of Supply Chain Management• Thorough Management of Labor Safety andSanitary Conditions• Cultivation of Technical Staff and Securing
Human Resources• Realization of an Attractive Working Environment
That Is Good to Work in
61 Governance• Corporate Governance• Management Members• Risk Management / Compliance

27 Special Feature 2
External Board Members’ Discussion

Data Section

31 Special Feature 3
Taisei Corporation’s Efforts to Realize a
Sustainable Society• (1) SDGs Dialogue• (2) SDGs×ZEB• (3) TAISEI i-Innovation®

75 Explanation and Analysis of Business Results
79 Consolidated Financial Statements
107 Independent Auditor’s Report
108 ESG Data of the Taisei Group109 ESG Data of Major Group Companies
110 Third-Party Opinion
111 Outline of the Company
113 Overseas Network

Business Section:
Venue of Value Creation
39 Civil Engineering
41 Building Construction
43 Real Estate Development

Note Regarding Forward-Looking Statements
This report has been produced in an environmentally friendly manner. It is printed
on lightweight paper to reduce the use of timber resources and transportationenergy, using vegetable oil-based ink.

TA I SE I A N N UA L R E P O R T 2 0 1 9Special Feature

13 Toward Medium- to Long-term Value Creation
14 Strategy for Sustainable Growth• Recognition of the Business Environment(Risks and Opportunities)• Important ESG Tasks for the Taisei Group(Materiality) and Impact on Corporate Activities• Communication with Stakeholders• Participation in Initiatives• Company-Wide Strategy:
Medium-term Business Plan (FY2018 – FY2020)• Investment Strategy and Human Resource Strategy• Priority Measures for Management Issues

Business Section

Toward Sustainable Growth of
the Taisei Group45 Toward the Realization of a Sustainable Society
49 Environment
Realization of a Sustainable and Environmentally
Friendly Society• Promotion of Environment Management Activities• For the Achievement of a Low-Carbon Society(Risks and Opportunities)• For the Achievement of a Recycling Society(Risks and Opportunities)• For the Achievement of a Society That Cohabitswith Nature (Risks and Opportunities)• For the Achievement of a Society Where Safety
is Assured (Risks and Opportunities)

ESG Section

5 Message from the President
7 The Taisei Group Corporate History
9 Taisei Group’s Now/Present
11 11-Year Financial and Non-Financial
Summary

ESG Section

Data Section

About the Taisei Group

Toward Sustainable Growth of the Taisei Group

About the Taisei GroupCONTENTS

4

About the Taisei Group

Message from the President

To Our Stakeholders

We aspire to be a
corporate group thatkeeps growing along withthe sustainable
development of society.
Yoshiyuki Murata
President and Chief Executive Officer,
Representative Director

Toward Achieving the Medium-term
Business Plan (FY2018 – FY2020)
On the back of the continued boom in the constructionindustry toward the Tokyo 2020 Olympics and Paralympics
Games, the Taisei Group’s FY2018 operating results
achieved an increase in revenues as its construction works
progressed smoothly. Also, the Group recorded thesecond-highest profit ever, although a decrease from therecord high posted in FY2017.
The post-Olympics domestic construction market is
expected to remain strong for the time being with measures
to strengthen national resilience, continuation of large-scale
re-development projects in central Tokyo, and the scheduled
Osaka-Kansai Expo.

current business size. To this end, the most important task
for us is to sustainably grow the overseas business andconvert to a corporate structure that is genuinely suitable
for the overseas market.
In addition to the overseas business, we will
strategically invest management resources in focus
areas in which we can demonstrate our corebusinesses’ strengths (energy and the environment,
urban development and PPP, renewal, engineering) as
well as in technological development for differentiation in
the future.

To Be a Trusted Company
The Taisei Group will celebrate its 150th anniversary in 2023.

In light of Japan’s declining population and financial

We need to lay out management directions from a

constraints, however, there is no room for optimism for the

long-term perspective more than ever in order to growmedium- to long-term operating environment.

sustainably past the landmark 150th anniversary.

The Medium-term Business Plan that started in FY2018

Going forward, it will also be increasingly important tostates a target business scale in the medium to long term of

respond to climate change, environmental conservation,¥2 trillion under the basic policy of “establishing a foundation

Japan’s aging population with a declining birth rate andfor growth with the construction business at the core.”other social issues, and globally shared Sustainable

In order for Taisei Corporation to achieve sustainablegrowth even if the domestic construction market shrinks inthe future, it is indispensable to secure and expand its

5 TA I S E I A NNUA L R EPORT 2019

Development Goals (SDGs).
Responding to environmental, social and governance(ESG) issues properly and proactively, in addition to dealing

Numerical Management Targets

FY2020 Target

1,650.8

1,740.0

1,870.0

Operating income

153.3

148.0

187.0

Net income attributableto owners of parent

112.5

103.0

130.0

ROE

16.2％

13.9％

12% or higher

Dividend ratio

25.4％

27.0％

About 25%

Interest-bearing debt

217.4

230.0

Less than ¥300 billion

Net interest-bearing
debt*(250.3)—(Permanent substantiallydebt-free operation)

Equity ratio

39.0％

—

40% or higher*Net interest-bearing debt = Interest-bearing debt – Cash and time deposits

have identified eight ESG tasks (Materialities) that areconsidered to be particularly important for the TaiseiGroup. Especially, “Promotion of Compliance” serves as
the basis for business activities as social credibility is themost important issue for a company’s existence.
In 2018, we were suspected of violating the AntiMonopoly Act in relation to the Linear Chuo Shinkansen
construction project. Taking this incident seriously, werevised our internal rules on contact with industry peers in
September 2018 and operated our business under stricter
rules. Furthermore, we provided thorough training andeducation to officers and personnel. For example, we
conducted e-leaning programs for all officers andpersonnel, in addition to training by external experts forofficers and personnel in sales departments. We willcontinuously make further efforts to ensure compliancewith the Anti-Monopoly Act.
While all officers and personnel in the Group think

Realizing Stable Dividends
It is our policy to provide stable dividends to shareholders
over the long term. We will properly return profits to ourshareholders while strengthening our financial base to beprepared for future business development. With the aim ofenhancing shareholder returns and improving capitalefficiency, it was resolved at the General Meeting of
Shareholders held on June 26, 2019 to increase dividends

Business Sectionof competitiveness. In the Medium-term Business Plan, we

per share for the year by ¥5 to ¥130 (total dividends of¥28.4 billion). In addition, the Board of Directors’ meeting
held on May 10, 2019 resolved to buy back up to 8,300
shares (¥28 billion) of Taisei Corporation’s common stock.
We will aim to become a corporate group that keeps
growing with the sustainable development of society by
sharing the Taisei Group Philosophy of “To Create a Vibrant
Environment for All Members of Society” among all officers
and personnel, and through dialogues with our stakeholders.
We would appreciate your high hopes as well as
continued support for our efforts toward further growth.
Data Section

with global initiatives such as SDGs, also creates a source

ESG Section

Net sales

Toward Sustainable Growth of the Taisei GroupFY2019 Plan

(Billions of Yen)

Special Feature

Medium-term Business Plan (FY2018 – FY2020)
FY2018 Actual

About the Taisei Group

Numerical management targets in the last fiscal year of Medium-term Business Plan (FY2020) (Consolidated)about what they should do based on an understanding ofcompliance’s essence, that is to respond to the expectationsof society, I, as the top management, will take the lead inworking on business activities going forward.

TA I SE I A N N UA L R E P O R T 2 0 1 9

6About the Taisei GroupDOMESTICThe Taisei Group Corporate History❷ The Tokyo Underground Railroad●
connecting Ueno to Asakusa❸The National Stadium Japan●

INTERNATIONAL❶ Kihachiro Okura●❾ Hotel Indonesia●❿ Cirata Hydroelectric Power Station, Indonesia●⓫ Djibouti Palace Kempinski Hotel●

Foundation – 1960
About Origin of Corporate Name
and Corporate Emblem
Origin of Corporate Name
Derived from the Dharma name (posthumous Buddhist name) of
the founder Kihachiro Okura. “Taisei” is taken from a line in the
Chinese classic texts, “Mencius.” It has a meaning of the“corpus” of people’s virtues, which can be associated withaccomplishing something, or gathering many pieces to build up
something. As such, it was chosen as the most suitable for ourcompany name. “Kensetsu” is a translation of the English word“construction,” and it represents the fields of both civilengineering and building construction. We were the first
construction company that adopted in its corporate name inJapan, and many other companies followed suit.

Corporate Emblem
It represents the corporate philosophy of Taisei Corporation,
which pursues higher, deeper, and wider operations in harmony
with nature. The orange color stands for a bright future, the blue
for advanced technologies, and the green for abundant nature.
An image of a natural environment on the irreplaceable earth—land, sea, and sun—, and us, human beings, with Taisei
Corporation continuing to conduct activities higher, deeper, andwider than ever while maintaining a balance with the naturalenvironment is depicted with energy anddynamics. Taisei Corporation adopted thissymbol mark in April 1990, as a newcorporate signature for the VI (visual
identity) campaign, and officially adopted
as its corporate emblem on April 1, 2003.

7 TA I S E I A NNUA L R EPORT 2019

Carrying the modernization of Japan aswell as the post-war reconstruction anddevelopment of new-born JapanFounder Kihachiro Okura
The history of Taisei Corporation began when Kihachiro
Okura (❶) established Okura Gumi Shokai in 1873.
Kihachiro Okura engaged in import-export trade andconstruction. He gathered competent engineers anddelivered one successful project after another, including
the lock and tunnel at Lake Biwa, which became pioneer
modernistic civil engineering work, as well as theconstruction of the first subway in the East, 2.2 km
between Ueno and Asakusa (the current Ginza Line) (❷).
1873 Established Okura Gumi Shokai (Foundation)
1887 Established Nippon Doboku Co., Ltd. (the first
corporation in the Japanese construction industry)
1917 Established Kabushiki Gaisha Okura Doboku Gumi
(first kabushiki gaisha (stock-type company) in theJapanese construction industry)

Birth of Taisei Corporation
Okura Gumi had difficulty surviving when designated as atarget of the dissolution of zaibatsu (industrial group) but
started over again under a new name, Taisei Corporation,in 1946. Introducing an employee shareholder program,
Taisei Corporation became a non-family firm, which is rareamong Japanese construction companies.
1946 Changed the name to Taisei Corporation
1947 Elected the President and Directors by employee voting
1956 Listed shares on Tokyo Stock Exchange, theindustry’s first such listingAbout the Taisei Group⓭ New Doha International Airport Terminal●
Building, Qatar❼ The Otemachi Tower●❽ The New Head Office Building●of Kinki Sangyo Credit Union⓮ No.2 Terminal Building Noi Bai International●
Airport, Vietnam

1961 – 20102011 – Present

Participated in Numerous National Projects

To the International Stage

Many infrastructure projects began for completion to coincide withthe 1964 Tokyo Olympics, such as the National Stadium Japan (❸)
and the Metropolitan Expressway, adding color to this period. This
period also saw the completion of Hotel New Otani (❹), aninternational hotel with more than 1,000 guestrooms, as well as
Hotel Okura Tokyo (see p.42), which combined Japanese tradition
with modern facilities. The construction technologies acquired
through these projects were adopted in skyscraper buildings inShinjuku subcenter one after another and spread widely. The
Company kept rising to challenges to enhance its technologicalcapability and comprehensive strengths, participating in national
projects, such as North and South Bisan Seto Bridges (❺), Seikan
Tunnel, Cirata Hydroelectric Power Station in Indonesia (❿) andDjibouti Palace Kempinski Hotel (⓫).

In 2013, Taisei Corporation completed constructing the Bosphorus
Strait Crossing Railway Tunnel in Istanbul, which connects Europeanand Asia via railroad tunnels (⓬). The installation of a tunnel on the
60-meter deep bottom of the sea, a world-record depth for asubmerged tunnel, was very challenging work. Nevertheless, wefinally realized the Turkish people’s long-cherished dream with ourcollective best technologies. In addition, our long list ofachievements in the construction of domestic and international
airports was acknowledged in the world, and this brought us orders
for New Doha International Airport Terminal Building in Qatar (⓭)
and No. 2 Terminal Building Noi Bai International Airport, aconstruction of the largest scale in North Vietnam (⓮). As such,
we are accelerating our efforts in overseas infrastructure projects.

1960 Opened Research Institute (currently Technology Center)
1962 Completed Hotel Indonesia (Taisei’s first postwar overseas
construction) (❾)

Environmental Consideration, Creating a
Resilient FutureParticipating in numerous national projects andaccommodating diversifying construction needs
with comprehensive strengths

Enhanced Comprehensive Strengths throughRealignment of Group Companies
Overlaps and competition in business among Group companies
were eliminated to increase business efficiency.
2008 Spun out the housing business division as Taisei Housing
Corporation2009 Turned Taisei Rotec Corporation, a major subsidiary, into awholly owned subsidiary2010 Turned Yuraku Real Estate Co., Ltd. (currently Taisei-Yuraku
Real Estate Co., Ltd.) into a wholly owned subsidiary

Toward Sustainable Growth of the Taisei Group

Government Building No. 1

Special Feature❻ Tokyo Metropolitan●

Promoting technological innovation to respondto social changes and their incidental challenges,
with the aim of creating future values

In 2014, we completed The Otemachi Tower (❼), a redevelopment
project for nature restoration by the “pre-forest” method of
replanting trees that were grown at a different site, realizing an
open ceiling space from the underground to the ground with use
of ultrahigh strength concrete. In the same year, aiming for an
urban office ZEB (a acronym for Net Zero Energy Building), we
built ZEB Demonstration Building on the premises of the Taisei
Corporation Technology Center. This gave us momentum to pushforward with ZEB (see p.35). In 2019, we completed the New Head
Office Building of Kinki Sangyo Credit Union (❽), actualizing ZEB
in an urban high-rise building. We aspire to create future values byproactively responding to environmental issues and making fulluse of disaster prevention/reduction technologies.

TA I SE I A N N UA L R E P O R T 2 0 1 9

Business Section

Bridges

ESG Section⓬ Bosphorus Strait Crossing Railway Tunnel, Turkey●❺N● orth and South Bisan Seto

Data Section❹ Hotel New Otani Main Building●

8About the Taisei Group

Taisei Group’s Now / Present
Using its high-level technology developed overmany years, the Taisei Group operates various
businesses centered on Civil Engineering,
Building Construction, and Real Estate Development.
It contributes to the sustainable development ofsociety through building safe and comfortableliving environments and aims to improve its
corporate value across the Group.

Civil Engineering
Through the construction of facilities and structures that
support people’s lives and industries and accord with theenvironment, we work for social capital improvements. In
recent years, we have built our own CIM system in which
ICT and 3D data are integrated in an effort to improve thequality and productivity of construction at a number ofcivil engineering sites.
p.39 Business Section: Civil Engineering Division

Composition by Segment
Real Estate
Development¥121.8 billion
7.0%
Building
Construction¥1,130.4 billion
65.2%

Others ¥12.1 billion
0.7%
Net Sales by
Segment

Civil Engineering¥468.6 billion
27.0%

Building Construction
By accommodating various needs for R&D activities andengineering technologies to deal with environmental andenergy issues, improved antiseismic and disasterprevention systems for business continuity purposes incase of disaster, etc., we provide safe, secure, andcomfortable environments and highly convenient buildings.
We have been involved in a number of constructions thatsymbolize an era, inside and outside Japan.
p.41 Business Section: Building Construction Division

Real Estate
Development¥12.9 billion
8.4%
Building
Construction¥87.6 billion
57.2%

Others ¥1.1 billion
0.7%
Operating Income
by Segment

Civil Engineering¥53.0 billion
34.6%● Net sales and operating income include intersegment transaction.

Composition percentages are figures calculated from simple sum totals.

Real Estate Development
We study buildings comprehensively throughout their
entire life cycle and build an optimized consensus inorder to support the promotion of large development
projects, and actively engage in projects as a developer.
Our efforts help improve not only the efficiency of public
works and services, but also public finances.
p.43 Business Section: Real Estate Development Division

FY2018 Data
■ Orders received■ Net sales■ Operating income■ Net income attributableto owners of parent■ Net assets■ Return on equity (ROE)■ Number of personnel(including Non-Japanese)
Male
Female¥1,693.8 billion¥1,650.8 billion¥153.3 billion¥157.9 billion¥722.3 billion
16.2%
14,433866
11,9062,527(As of March 31, 2019)9 TA I S E I A NNUA L R EPORT 2019

OthersMain Domestic Subsidiaries■ TAISEI ROTEC CORPORATION (Pavement and civil engineering)■ Taisei-Yuraku Real Estate Co., Ltd. (Real estate development, facility
management, etc.)■ TAISEI U-LEC CO., LTD. (Planning, design, and construction of housing complexes)■ TAISEI SETSUBI CO., LTD. (Air conditioning, sanitation, electrical equipment, andinterior finishing)■ TAISEI HOUSING CORPORATION (Design, construction, and sales of order-madeindividual housing)■ SEIWA RENEWAL WORKS CO., LTD. (Civil engineering, renewal work, production
and sales of construction machinery, etc.)

About the Taisei GroupInternational

大成建設グループについて

Domestic

Tunnels, bridges, roads, and dams,
and Decontamination, maintenancepreservation, and builds social
infrastructure

Naruse Dam Quarry Work
(1st Period) (Ogachi-gun, Akita)

Construction Work of the Shinmeishin
Expressway Ikuno-ohashi Bridge (PCupper part Work) (Kobe-shi, Hyogo)

Domestic

Construction on phase one of theNorth-South Commuter Railway
project (Manila)(see p.18)

International

Toward Sustainable Growth of the Taisei GroupLines of Business

New Construction of Yoma Central Project(Myanmar)
Tokyo Electron Technology Solutions
Note: The low-rise building located in the
New Construction of new building of
foreground is not related to this project.
Tohoku Branch Office (Oshu-shi, Iwate) New Construction of
Marunouchi Niju-Bashi
Building (Chiyoda-ku, Tokyo)

International
Business Section

Domestic

Lines of Business

Redevelopment, PFI, property
management, and condominium
sales projects

New Construction of
Toranomon 2–Chome District
Project (Minato-ku, Tokyo)

Construction Work of Omiya ward
office (Saitama-shi, Saitama)

Construction Work of Roygent
Parks Hanoi (Vietnam)

Lines of Business

ESG Section

Airports, office buildings, commercial
facilities, factories, and hospitals, thehousing business, Renovation anddemolition and research anddevelopment and engineering
technologies

Special Feature

Lines of Business

Overseas Business Offices

Overseas Subsidiaries / Affiliated Companies■ Taipei Office■ Middle East Office (Doha)■ Singapore Office■ Kuala Lumpur Office■ Jakarta Office■ India Office■ Pakistan Office■ PT. TAISEI PULAUINTAN Construction International (Indonesia)■ TAISEI (THAILAND) CO., LTD.
■ VINATA INTERNATIONAL CO., LTD (Hanoi/Hochiminh City)■ CSCEC-TAISEI CONSTRUCTION, LTD (Beijing)■ TAISEI PHILIPPINE CONSTRUCTION INCORPORATED■ PT. INDOTAISEI INDAH DEVELOPMENT (Indonesia)■ TAISEI MYANMAR CO., LTD. (Myanmar)■ Vietnam Office (Hanoi/Hochiminh City)■ Thailand Office■ Philippine Office■ Myanmar Office■ Sri Lanka Office■ North Africa Office■ Istanbul Office

Data Section

Contract research, technology
provision, and environmental measurements

TA I SE I A N N UA L R E P O R T 2 0 1 9 10About the Taisei Group

11-Year Financial and Non-Financial Summary

TAISEI CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2009 through 2019

Financial Highlights (Consolidated)
Millions of Yen(except for per share figures)

March 31, 2009

March 31, 2010

March 31, 2011

March 31, 2012

March 31, 2013

Net sales:
Construction contracts
Real estate development and otherTotal% change from previous year

¥ 1,467,070
174,112
1,641,182(4.1)%¥ 1,289,809
152,166
1,441,975(12.1)%¥ 1,079,139
138,980
1,218,119(15.5)%¥ 1,171,927
151,577
1,323,504
8.7%¥ 1,254,291
162,205
1,416,496
7.0%

Costs and expenses:
Cost of sales
Selling, general and administrative expenses
Total
Operating income (loss)
Income (loss) before income taxes
Income taxes
Net income (loss) attributable to owners of parent

1,545,918
95,9201,641,838(656)(38,449)(9,404)¥ (24,401)

1,318,593
87,755
1,406,348
35,62735,516
14,462¥
21,222

1,100,022
81,803
1,181,825
36,294
19,3748,514¥
10,883

1,206,014
81,004
1,287,018
36,486
16,673
15,480¥1,181

1,304,677
76,213
1,380,890
35,60632,82812,399¥20,051

¥

¥

¥

¥

¥

Revenue:

Per share data of common stock(in yen and dollars):
Net assets
Net income (loss) attributable to owners of parent
Cash dividends
Financial ratios:
Net income (loss) attributable to owners ofparent as a percentage of total revenue
Total costs and expenses as a percentage of total revenue
Dividends paid as a percentage of net income
Financial position data:
Current assets
Current liabilities
Net property, plant and equipment
Long-term liabilities
Shareholders' equity
Net assets
Other data:
New orders received during the year
Contract backlog at the end of year
Shares issued (thousands)

239.87(22.93)
5.00

262.1519.74
5.00

253.94
9.58
5.00

255.601.04
5.00

299.84
17.60
5.00(1.5)%

1.5%

0.9%

0.1%

1.4%

100.0%
---%

97.5%
25.3%

97.0%
52.2%

97.2%
482.3%

97.5%
28.4%

¥ 1,082,037
1,074,229
236,705
248,400
252,905
284,713¥ 912,895
894,026
238,534
250,083
274,779
297,179¥ 847,467
808,052
232,000
235,607
290,282
290,598¥ 982,931
921,196
212,639
219,101
284,714292,602¥ 1,012,639
907,281
206,076
292,514299,336
343,300¥ 1,524,578
1,768,950¥ 1,244,439
1,571,414¥ 1,254,095
1,607,390¥ 1,379,572
1,663,459¥ 1,404,407
1,651,370

1,064,803

1,090,622

1,140,269

1,140,269

1,140,269*1 U.S. dollar amounts were translated from yen, for convenience only, at the rate of U.S. $ 1 = ¥110.99*2 The net assets per share and the net income per share are calculated assuming that the consolidation of shares took place at the beginning of the year, because the consolidation ofshares, at the ratio of 1 share for 5 shares, was implemented on October 1, 2017.

Non-Financial Highlights (Consolidated)
Number of Personnel (Consolidated)/
Number of Female Managers (Non-Consolidated)■ Male■ Female

13,977

12,00014,032

14,433

2,243

2,314

2,527

11,734

11,718

11,906(People)(Cases)

200

400

150

300

100

200

50

100

0

0

167

8,000
4,000
0

* The totals for Taisei Corporation and our 6 major Group companies.

Female managers(People)16,000

Number of Patent Applications Filed*

83

62
2016

2017

2018

(FY)

The Taisei Group is promoting diversity in management positions and expanding
the range of women’s work to facilitate strategies and technological developmentthat incorporate diverse values.

11 TA I S E I A NNUA L R EPORT 2019

311

2016

253

226

2017

2018

(FY)

By visiting construction sites and other means, we are researching technologies
that can be patented and obtaining rights, and we aim to ensure high-quality
applications and obtain a wide range of rights.

March 31, 2016

March 31, 2017

March 31, 2018

March 31, 2019

March 31, 2019

¥ 1,321,289
212,184
1,533,473
8.3%¥ 1,404,530
168,740
1,573,270
2.6%¥ 1,394,677
151,212
1,545,889(1.7%)¥ 1,342,455
144,798
1,487,253(3.8%)¥ 1,445,277
140,221
1,585,498
6.6%¥ 1,511,724
139,154
1,650,878
4.1%$

1,402,446
77,254
1,479,700
53,773
46,593
14,120¥32,0891,425,295
77,5581,502,853
70,417
66,98028,755¥38,177

1,348,302
80,1191,428,421
117,468
117,797
40,996¥
77,045

1,260,968
85,462
1,346,430
140,823
135,190
44,793¥90,566

1,318,880
84,7581,403,638
181,860
182,297
55,508¥ 126,788

1,409,418
88,136
1,497,554
153,324
160,777
48,075¥112,572

$

¥

¥

¥

¥ 2,483.01
392.87
20.00¥ 2,975.02*2
561.36*2
85.00*3

¥

$

29.76
4.61
1.17

335.4228.17
6.00

418.61
33.52
8.00

442.6765.85
16.00

3,302.86
511.90130.00

2.1%

2.4%

5.0%

6.1%

8.0%

6.8%

96.5%
21.3%

95.5%
23.9%

92.4%
24.3%

90.5%
25.5%

88.5%
22.3%

25.4%

13,620,362
1,253,753
14,874,115

12,698,604
794,089
13,492,693
1,381,422
1,448,572
433,147
1,014,254

90.7%¥ 1,076,213
946,097
181,051
268,802327,067
384,166¥ 1,136,497
984,762
169,973
258,373
370,140
492,114¥ 1,112,305
927,777
177,529
211,767
437,533
521,278¥ 1,223,572
986,994
175,983
202,271
485,396
570,814¥1,327,487*4
1,022,626
188,397
218,952*4
563,913669,020¥ 1,200,437
924,791
219,745
198,995
610,565
722,390$

10,815,722
8,332,201
1,979,863
1,792,909
5,501,081
6,508,605¥ 1,645,896
1,763,793¥ 1,765,743
1,956,266¥ 1,671,061
2,081,438¥ 1,655,036
2,249,221¥ 1,743,498
2,407,221¥ 1,693,859
2,450,202$

15,261,366
22,075,881

1,140,269

1,171,269

1,171,269

1,146,753

224,541

224,541*3 Total annual dividends per share as of March 31, 2018 is ¥ 85.00, which is the sum of the interim dividend per share of ¥ 10.00 and the year-end dividend per share of ¥ 75.00. Due to theconsolidation of shares at the ratio of 1 share for 5 shares implemented on October 1, 2017, the year-end dividend per share of ¥ 75.00 reflects this consolidation, while the interim dividend
per share of ¥ 10.00 does not. If the interim dividend per share is calculated based on the consolidation of shares, it would be ¥ 50.00, making the total annual dividends per share ¥ 125.00.
*4 Effective from the year ended March 31, 2019, the Group retrospectively applied “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28,
February 16, 2018). The Group applied this change retrospectively and restarted the 11-Year Summary from the year ended March 31, 2018, accordingly.

Frequency Rates*1

Total CO2 Emissions*2*1 The totals for Taisei Corporation and our 6 major Group companies.

*2 The totals for Taisei Corporation and our 7 major Group companies.

1.0

400,000(t-CO2)0.5

0.58

340,000

2016

2017

360,000

300,000

0.44

Data Section

0.53

332,000

200,000
100,000

0

2016

2017

2018

About the Taisei Group

March 31, 2015

Toward Sustainable Growth of the Taisei Group

March 31, 2014

Special Feature(except for per
share figures)

Business Section

Millions of Yen(except for per share figures)

ESG Section

Thousands of
U.S. Dollars*1(CY)

The Frequent rates are the number of fatalities and injuries at worksites per
one million cumulative working hours, which represents the frequency ofoccurrence of occupational accidents. We are implementing a range ofmeasures to prevent accidents and disasters.

0

2018

(FY)

We are working to reduce CO2 emissions to contribute to the reduction ofclimate change, which is a risk for the construction business.

TA I SE I A N N UA L R E P O R T 2 0 1 9 12

Toward Sustainable Growth of the Taisei Group

Toward Medium- to Long-term Value Creation
The Taisei Group strives to maximize the value created through dialogue with stakeholders, and aims toachieve sustainable development together with society by proactively getting involved in social challenges
which the Group needs to resolve through its businesses.
Materiality refers to an important task to
be addressed by the Taisei Group.
It is considered to connect global tasks,
such as SDGs, and the Taisei Group’s
structure of values and policies.

pp.15, 31-38,47-48

pp.1-2Contributing to Solving
Global Challenges

Objectives to be Pursued
by the Taisei GroupSpecific social challenges, suchas Sustainable Development
Goals (SDGs) and the Paris
Agreement have been set out asglobal common goals to beachieved. The Taisei Group willcontribute to realization of asustainable and better world toresolve these challenges.

Sustainable
Development
through Value
Creation

By seeking to achieve the TaiseiGroup Philosophy, the TaiseiGroup will create safe, secureand attractive spaces, and highvalue in harmony with the nature,
well as strive to build a global
society filled with dreams andhopes for the next generation.

p.14
Changes in External
Environment / Risks andOpportunities

p.15

Creating Value throughDialogue with Stakeholders

Climate changes, increasing energy
demand, growing world population,
aging society, aging infrastructure,
decreasing productive-age
population in Japan

Customers

Taisei Group Philosophy

Shareholders/
Investors“To Create a Vibrant Environment for
All Members of Society”
pp.61-74

Corporate GovernanceMateriality for
the Taisei Group

Value Chain＞＞＞

Renovation
anddemolition

The TaiseiGroup’sStrengths

Strategy,planning,
anddevelopment＞＞＞

Realization ofa sustainable andenvironmentallyfriendly society

Operation and pp.39, 41, 43 Design
management;
andmaintenance andengineering
preservation
Procurement
and work
implementation

＞＞＞

＞＞＞

Ensuring quality
and improving
technology

pp.16-22

Medium-term Business Plan
(FY2018 – FY2020)

Technical
development forrealizing asustainable
society

13 TA I S E I A NNUA L R EPORT 2019

Promotion of
supply chain
management

Promotion ofcompliance

＞＞＞

＞＞＞

p.14, pp.46-60

Employees

Thoroughmanagement oflabor safety andsanitary
conditions

Realization of an
attractive working
environment thatis good towork in

Cultivation oftechnical staff
and securinghumanresources

Suppliers

Local
communities

Recognition of the Business Environment (Risks and Opportunities)
After the Tokyo 2020 Olympics and Paralympics Games are held, it is anticipated that we will face the risk of a sharp
decline in construction demand and a recurrence of a period of severe shakeout. The following table summarizes ourforecasts of the business environment after 2020 in terms of risks and opportunities.

Market environment
Worldwide Trends

Public works

Private sector

A high level of work contract volume will continue
up to 2020
● Projects will materialize from 2020 onwards●

Strong construction investment in newly developing
countries● Accelerating overseas penetration by Japanesedevelopers● Large-scale exports of infrastructure led bygovernment●

As a result of continuation of infrastructure development, a constant level of
public works investment will be maintained●

Important public works infrastructure concession projects will become
established as part of the general contractor business segment●

Although there is much latent demand, such as urban redevelopment, research andproduction facilities, renewal of buildings from the period of high economic growthrate, etc., the sense of lack of clarity in the long term cannot be brushed away●

Overall expansion of the construction market overseas●

The Japanese growth strategy of infrastructure exports continues●

The amended Labor Standards Act will also apply to the construction industry●

The result of work style reform will affect the growth of company●

Staff shortages actualize, and productivity improvements, and ensuring supply
capability will have a great effect on the growth of company●

The strategy for growth by specialization of each company will become clear●

There will be increasing importance of accumulation of technical capability
and know how in response to diversifying and advanced customer needs●

Potential for unexpected new participants (high tech, IT related, ventures, etc.)●

Overseas

Work stylereformProductivity
improvement●●

Dealing corrections of long working hours
Work style reform and shortages of staff will befactors for productivity improvement andoptimization of tender prices

Development of technologies to contribute toproductivity improvement is an urgent task
● Activities are required with specialist contractors●

Moves to strengthen and expand business areas
other than the domestic construction industry(overseas, energy, real estate, etc.)● Start of competition for introduction of advanced
technology●

Competitive
trendsToward Sustainable Growth of the Taisei Group

2020 Onwards

Measures against aging of social infrastructure
and infrastructure development to strengtheninternational competitiveness are urgent tasks● Expansion of the scope of general contractors’
business as a result of spread of concessions●

Special Feature

Present

About the Taisei Group

Strategy for Sustainable GrowthMaterialities

Negative Impacts
Deterioration of creditworthiness and loss of opportunities toreceive orders due to violation of environmental laws andregulations or environmental accidents.
● Increased costs due to construction suspensions or delays
resulting from shortages of raw materials or electricity toaddress climate change.
●

Environment

Realization of asustainable andenvironmentally friendly
society●

Interruption or suspension of business, loss of opportunities toreceive orders, or financial loss due to the occurrence ofquality defects.

●

Continuing business and creation of business
opportunities through cooperation and building
trusting relationships with customers.

Technical development
for realizing asustainable society●

Decline in market competitiveness and financial loss due tofewer application track records for development of new
proprietary technology.

●

Contribute to solving social issues by improving
technological capability through business and increase
market competitiveness.

Thorough managementof labor safety andsanitary conditions
Cultivation of technicalstaff and securing
human resources
Realization of an
attractive working
environment that isgood to work in

Suspension of raw material supply due to occurrence of
procurement risks.
● Decline in reputation owing to occurrence of human rights risks.
●●●

Promotion ofcomplianceDecline in customer trust due to occurrence of fatal accidents.
Lower productivity due to occurrence of work-related accidents.

Lower market competitiveness due to decline in customer trust.
● Decline in organizational capabilities and loyalty of personnel due
to insufficient human resources development and lack of diversity.
●●●

Decline in reputation owing to occurrence of human rights risks.
Difficulty in recruitment activities due to a decline in reputation.

Interruption or suspension of business due to information
security accidents.
● Decline in reputation due to occurrence of human rights or
corruption risks.
● Interruption or suspension of business, or loss of opportunities
to receive orders, due to disregard for compliance.
●

Governance

Increased opportunities to receive orders due todevelopment and practical application ofenvironmental technologies.
● Market expansion due to reinforcement of
infrastructure to address climate change.

Ensuring quality andimproving technology

Promotion of supply
chain management

SocialPositive Impacts●

Sustainable supply of raw materials due toprocurement risk management.
● Improved competitiveness as a result of securing
good-quality cooperating companies.
●●●

Maintenance of reputation by preventing fatal accidents.
Improved productivity as a result of achieving a safe
workplace environment.

Reinforcement of technological capabilities and humanresources development through customer needs.
● Increased organizational capabilities and loyalty
of personnel by fostering excellent and diverse
human resources.
●●●

Deterioration of reputation due to decline in trustfrom personnel.
Maintenance of reputation by preventing humanrights risks.

Data Section

ESG

ESG Section

On the basis of social challenges such as SDGs and by referring to experts’ opinions, we have identified eightmateriality that are particularly important and to be dealt with by the Taisei Group, in terms of their importance forsociety and for management of the Taisei Group.

Business Section

Important ESG Tasks for the Taisei Group (Materiality) and Impact on Corporate Activities

Maintenance of competitiveness through appropriate
information management.
Continuation of business and creation of business
opportunities through appropriate risk management.
● Maintenance and enhancement of corporate value
through reinforcement of global compliance system.
●●

TA I SE I A N N UA L R E P O R T 2 0 1 9 14

Toward Sustainable Growth of the Taisei Group

Strategy for Sustainable Growth
Communication with Stakeholders
We are striving to increase corporate value through dialogues with various stakeholders.
Stakeholders

Taisei Group: Responsibility and Approach
We have established our Quality Policy, Health and Safety Policy, and Policy on Business Continuity in Times ofDisaster in an effort to provide good-quality, safe and secure construction products, support for business
continuity at times of disaster, and related services.
● We strive to provide value-added solutions with an understanding of increasingly diverse and complex needs andexpectations of customers.
● We listen to various opinions and requests through customer satisfaction surveys and take advantage of them toimprove quality and increase productivity.
●

Customers

We have established our Fundamental Corporate Governance Policy, Information Disclosure Policy, and IR Policy.
We strive to return profits properly, disclose corporate information in a timely and appropriate manner, and practicecorporate governance and internal control properly, in an effort to have meaningful dialogues with shareholders at
General Meetings of Shareholders.
● We strive to promote constructive dialogue via the President explaining our performance and management
strategy as well as holding question-and-answer sessions at results briefings and meetings with overseas
institutional investors.
●

Shareholders /Investors

We have established our Procurement Policy in an effort to promote partnerships through fair and impartial
transactions, aiming to mutually raise the level of efforts on quality, compliance and respect for human rights.
● In coordination with Soyukai/Health, Safety and Environment Cooperation Association, comprising specialized
contractors (cooperating companies) across Japan, we make efforts to eliminate work-related accidents at workplaces,
prevent health problems and environmental accidents, and promote environmental conservation activities.
●

Suppliers

We have established our Values and Policies and strive to spread and embed them further among employees
through training. In addition, we have established our Human Rights Policy in an effort to realize a pleasant
workplace where employees’ human rights and diversity are respected.
● We comply with labor-related laws and regulations, give due consideration to workplace health and safety, andhave established an EAP, various consultation desks for matters including nursing care, a ‘Corporate ethics
helpline” and ‘Group helpline’ to handle issues such as discrimination and harassment.
● We hold regular consultation with the employees’ union regarding the workplace environment and labor
conditions, while also conducting personnel satisfaction surveys biennially.
●

Employees

Local
communities
Internationalsociety
Globalenvironment

We have established our Social Contribution Policy, Environmental Policy, and Declaration of Biodiversity
Preservation, and strive to create good relationships with local residents while promoting environmental
management activities.
● In addition to the Taisei Corporation Public Trust of Funds for Natural and Historic Environments, an organization
for supporting projects for the preservation of the natural environment, and the Taisei Foundation, which subsidizes
research and development in new technical fields, we strive to spread construction culture by cooperating in the
exhibition of architecture and paintings by Le Corbusier.
● We strive to help resolve social issues through actions based on signing (participating in) the United Nations Global
Compact and giving support for various global initiatives such as SDGs (Sustainable Development Goals).
●

Participation in Initiatives
The Taisei Group signed (participated in) the United Nations Global Compact in 2018 and, as a member corporation,
will contribute to the resolution of global issues such as SDGs (Sustainable Development Goals).
United Nations Global Compact

Taisei corporation became a full member of theUnited Nations Global Compact in April 2018.
We are respecting the 10 principles in the areasof human rights, labour, the environment andanti-corruption of the UN Global Compact.

15 TA I S E I A NNUA L R EPORT 2019

Sustainable Development Goals

About the Taisei Group

Company-Wide Strategy

Medium-term Business Plan (FY2018 – FY2020)[ Basic Policies ]Summary of Basic Policies●

Sustainable growth of overseas business, and conversion to a corporate structure that is genuinely suitable for theoverseas market●

Investment for growth will be carried out in order to expand added value and opportunities for revenue in theconstruction and peripheral businesses both in Japan and overseas, to construct the basis for sustainable growth in
the Taisei Group●As a leader in the construction industry we will set an example by the public and private sectors of unified initiatives
for work style reform and productivity improvement for growth in the construction industry●

We re-acknowledge that improving customer satisfaction by ensuring safety and quality is a major precondition forcompanies to be selected by customers, and is a source of growth

Toward Sustainable Growth of the Taisei GroupTo establish the foundation for growth withthe construction business at the core>>> p.18

Strategic input of management
resources into target fields>>> p.19

Innovative construction production systems(productivity improvement)— “TAISEI i-Innovation” —>>> p.37

4
5
6

Realizing an attractive working environment(work style reform)— “TAISEI Lively Plan” —Pursuit of safety and quality>>> p.60— “TAISEI QUALITY” —>>> p.55

Strengthening management
infrastructure>>> p.61[ Management Numerical Targets ]●We will simultaneously uphold the highest standards of safety and quality, while providing customer
satisfaction and ensuring the Company’s performance, even during the extremely busy period approaching 2020.

Business Section

1
2
3

Sustainable growth of overseas
business

Special Feature[ Management Tasks ]FY2020 targets (Consolidated)
Operating income
Net income
ROE¥1,870 billion

Dividend payout ratio

About 25%

¥187 billion

Interest-bearing debt

Less than ¥300 billion¥130 billion

Net interest-bearing
debt*(Maintain permanent state of effectively
debt-free management)

12% or more

Capital-to-asset ratio

40% or more

ESG Section

Net sales●

In order to achieve sustainable growth in the uncertain market conditions after the 2020 Olympics and Paralympics,
we aim to expand our business scale to ¥2.0 trillion as our medium- and long-term target.

●

In light of the business environment at home and overseas from 2020 onward, we will strengthen our efforts
in overseas markets where growth is expected.

●

We will improve production capability by increasing productivity and workforce, and will accelerate
growth in target fields by making alliances, having open innovation, etc.

●

We will implement measures to achieve a business scale of ¥2.0 trillion under the Medium-term Business Plan
(FY2018 – FY2020), while taking account of the balance of main business segments* including overseas projects
and the approaches such as project investments and M&A deals.

Data Section* Net interest-bearing debt = Interest-bearing debt – Cash and time deposits* Main business segments: 1. Domestic construction projects 2. Overseas construction projects 3. Development and real estate projects 4. Construction peripheral businesses
5. Group companies

TA I SE I A N N UA L R E P O R T 2 0 1 9 16

Toward Sustainable Growth of the Taisei Group

Strategy for Sustainable Growth
Investment Strategy and Human Resource Strategy

Investment for Growth
In order to construct the business foundation to enable sustainable growth from 2020 onwards, we aim to increase
the added value in the construction and peripheral businesses and to expand opportunities for revenue.
<Funds><Applications>

Newly earned cash
during the new Medium-term Business Plan

Return to shareholders
Investment for growth

Accumulated to date Cash on hand

Sustainable growth and accelerated growth
Total ¥300 billion

Investment for sustainable growth and accelerated growth●

Strengthening overseas business and targeted fields*¥150 billion●

Investment in technical development¥60 billion●

Investment in work style reform and productivity improvement¥60 billion●

Investment in human resources, development of infrastructure, etc.

¥30 billion* Target fields: Energy and environment, urban development and PPP, renewal, engineering (see p.19)

Targets for Work Style Reform and Productivity Improvement
In order to respond to the social demand for correction of long working hours and the legal system, (standalone) targets
will be set in stages for work style reform and productivity improvement.
<Work Style Reform> * In accordance with the roadmap for correction of long working hours of 2024 ―TAISEI Lively Plan ―Healthmanagement
Overtime

FY2018FY2019FY20200 persons 100 hours or more
per month

Average 80 hours or less per month

Continue average 80 hours or lessper month(Preparation time for average
70 hours or less per month)

Rest days +time off in lieu
Closure ofwork sites

Target for all employees 8 rest days per 4 weeks (rest days + time off in lieu) 104 days or more per annum
Work towards uniformly closing sites
on Saturdays(2nd Saturday of every monthis closed day)Realization of 6 closed days every 4
weeks for all work sites(excluding sites for which application
is difficult)Work towards realizing 8 closed days
every 4 weeks for all work sites by 2021
(excluding sites for which application
is difficult)* For the results for FY2018, see p.59 “Initiatives to Correct Long Working Hours.”<Productivity Improvement>
Transformation of awareness● Technical development● Reduction in work
● Utilization of temporary staff● Promotion of client
understanding, etc.
●

FY2016
Productivity

Medium-term
Business Plan
（FY2018 – FY2020）
Productivity during
this period

10%UP(compared with
FY2016)* For the results for FY2018, see KPIs on p.55 “Ensuring Quality and Technical Improvement.”

17 TA I S E I A NNUA L R EPORT 2019

Target for
FY202520%UP(compared with FY2016)

(1) Sustainable growth of overseas business(2) Conversion to a corporate structure that is genuinely suitable for the overseas market
Explore and expand traditional areas and expand project areas in countries that we have already advanced into
Explore infrastructure export projects and STEP projects*1, cultivate new markets/areas such as entry into PPP*2 andconcession projects● Enhance construction capability and price competitiveness through the promotion of alliances with global contractors andlocal partners● Develop overseas staff by expanding the studying and training abroad programs and by hiring global and local humanresources actively●●*1 STEP projects: Stands for Special Terms for Economic Partnership, translated into Japanese as “honpogijyutsukatsuyojyoken” (terms and conditions on the use ofJapanese technologies), a program introduced in July 2002 for the purpose of promoting “aid/support that shows the face” of Japan by using
brilliant Japanese technologies and know-how in the transfer of technology to developing countries.

*2 PPP: Stands for Public Private Partnership, translated into Japanese as “kanminrenkei” (private-public initiative) or “kanminkyodo” (government-private sector

cooperation), a form of providing efficient and high-quality public services in which public services previously provided by the national government or local
municipalities are opened up to the private sector and operated under private-public cooperation.

We aim to increase revenue by taking on further challenges in Official Development Assistance projects as well as large-scale
private investment projects, focusing on countries and regions where we have construction experience, such as Southeast
Asian countries, Taiwan and Southwest Asia, and by establishing a framework of consortiums with globally active local
general contractors for the completion of projects. To expand the size, we also aim for a revenue increase in the overseas
building construction business through our investment in development as well as alliances including merger and acquisitions.

About the Taisei Group

Sustainable growth of overseas business, and conversion to a corporate structure that is genuinely suitable for theoverseas market.

Toward Sustainable Growth of the Taisei Group

1. Sustainable Growth of Overseas BusinessSpecial Feature

Priority Measures for Management Issues

Topi cs

Taisei Corporation participates as a designer and constructor for the renovation of existingterminal facilities and the construction of new terminal facilities under the Expansion, Renovation
and Operation areas of the Palau International Airport Project.
● This Project is an ‘All Japan’ airline infrastructure project that involves JICA’s overseas investment
as well as airport management operations by Sojitz Corporation, Japan Airport Terminal Co., Ltd.,and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development.
● The number of passengers utilizing the airport increased due to a rise in the number of tourists to
Palau. Expanding the airport facilities is intended to reduce congestion and improve convenience. Perspective drawing
We will contribute to economic development through the development of the tourist industry, acore industry in Palau.
●▌Promoting an ODA Project, Helping to Alleviate Traffic Congestion in the Philippines—Won CP01 construction area under the Philippines North-South Commuter Railway Extension Project—

We received an order from the contractee, the Philippines’ Department of Transportation (DOTr),for CP01 construction area (approximately 21 km) of a total extension of approximately 38 km)
under the North-South Commuter Railway Project (between Tutuban, Manila and Malolos,
Bulacan) being undertaken in the Philippines.
● The population has surged in Metro Manila and its suburbs with rapid economic development in
the Philippines. As traffic congestion is getting worse due to the higher population density,
improving transportation infrastructure has become an urgent issue.
● This construction work is a project implemented by the Japanese government’s Official
Development Assistance with the aim of resolving the issue described above. Taisei Corporation
will organize a consortium with D.M. Consunji Inc. (DMCI), a local major general contractor, andconstruct elevated viaduct structures, six stations and a depot, among other facilities in the area
between Metro Manila to Bocaue, Bulacan in the Northern Philippines.
● Leveraging in this project the know-how and experience cultivated through many construction
works of railway facilities we conducted in the past, we will provide our technological capabilities
for the alleviation of traffic congestion in Metro Manila and the expansion of the commutable area.

Data Section●

ESG Section—Designer and constructor for expansion work of Palau International Airport—

Business Section▌Participation in an ‘All Japan’ Airline Infrastructure Export Project

Perspective drawing

TA I SE I A N N UA L R E P O R T 2 0 1 9 18

Toward Sustainable Growth of the Taisei Group

Strategy for Sustainable Growth
Priority Measures for Management Issues

2. Strategic Input of Management Resources into Target Fields
Promotion of higher added value Taisei global business and expansion of opportunities for revenue by deploying
management resources (human resources, funds) in the target fields and on technologies for differentiation, from aviewpoint on the medium- and long-term business environment from 2020 onwards.

(1) Bringing higher added value to target fields where our core strengths can be exhibited❶ Energy and Environment● Strengthening the competitiveness to win orders through participation in energy management projects (EM)>>> p.35 Special Feature 3-(2)and energy supply projects (ESP) in the ZEB/Smart communication field Strengthening the competitiveness to
win orders by constructing design and construction systems in the fields of thermal power and renewable energy● Support for winning orders through environment-related evaluation technologies and soil decontamination
technologies, etc.

>>> p.49 Environment

We newly established the Energy Division in October 2018. In addition to entry into the businesses of offshore
wind and other renewable energy power generation as well as energy saving management and operation forbuildings and cities, we will strengthen our technological competitiveness with ZEB, hydrogen utilization, andother technologies.
In the area of the environment, we are actively developing and proposing various environmental technologies
that would increase our competitiveness over the medium to long term. This includes continuously providing
support for receiving orders for projects involving the biodiversity-friendly planning and assessment technologies
as well as anti-soil/groundwater pollution technologies and repository technologies, areas in which we are apioneer company.

❷ Renewal● Strengthening of proposals and sales for renewal by utilizing the technologies we possess as well as new technologies● Strengthening the renewal production system by technical development, improvement in procurement capability, etc.
● Promotion of winning orders for large-scale renewal and repair project of aged infrastructure (bridges, tunnels, etc.)

Being at a transition stage to a recycling-based society, we are expected to utilize high-quality stock. Renewal,
which is a filed in which the Taisei Group can demonstrate its technological strengths, is expected to grow overthe medium to long term.
In the field of architecture, we will propose plans for increasing asset values by realizing a long service life forbuildings through quake-resistance and energy saving assessments, while providing safe and secure buildings
utilizing anti-quake and other technologies.
In the field of civil engineering, responding to rising demand for maintenance and repair, and upgrading of aging
infrastructure, the Taisei Group as a whole, including the Technology Center and divisions of Taisei Corporation as
well as TAISEI ROTEC CORPORATION and SEIWA RENEWAL WORKS Co., Ltd., will drive forward technologicaldevelopment and sales strategy.

Aw ard▌Renovation of Historical Structures — “Minato City Local History Museum” received the excellent earthquake-retrofitted

building award of the Minister of Land, Infrastructure and Transportation —Minato City Local History Museum, a compound facility
that houses a Minato-ku local history museum, received
the excellent earthquake-retrofitted building award of the
Minister of Land, Infrastructure and Transportation underthe excellent earthquake-retrofitted building commendation
program created by the Ministry of Land, Infrastructure,
Transport and Tourism with the aim of promoting
earthquake-retrofitting for Japan’s existing buildings andcontributing to the formation of a healthy building stock.
Minato City Local History Museum is a publicCommon space centered on a round
vaulted ceiling. Only handrails andcompound facility located in Shirokanedai, Minato-ku, Tokyo,
supplementary lighting were added forcompleted in February 2018 after renovation through joint
safety measures, preserving the magdesign/construction of the former building of the Institutenificent designs at the time of itsof Public Health that was completed in 1938. In particular,
establishment including the ceiling relief
the building was recognized for its quake resistance,and handrail decoration.
disaster prevention and safety, and design excellence.

19 TA I S E I A NNUA L R EPORT 2019

About the Taisei Group● Participation in important infrastructure concession projects, such as airports, etc.

>>> p.31 Special Feature 3-(1)>>> p.43 Real Estate Development● Strategic investments in in-house developments and promotion of building operation

The business model of winning orders through participation in large-scale redevelopment projects and largescale private projects, which we have been working on, is currently the pillar of our building construction
business. By participating in PPP/PFI projects, we strive to improve efficiency and services of public works
projects while contributing to better public finance.
In addition, we will secure stable earnings in our real estate development business by stably operating thereal estate we developed and holding good real estate properties for lease. In private-public initiatives, which
are expected to grow further, we will boost our efforts for the airport concession business.

Toward Sustainable Growth of the Taisei Group● Strengthening the competitiveness to win orders by participation in large-scale private sector projects
and PPP/PFI*3 projects, and steady promotion of large-scale redevelopment projects

Special Feature❸ Urban Development and PPP❹ Engineering● Expansion of business area won in the life sciences field, with pharmaceuticals as the core
● Promotion of upstream sales through consulting and feasibility study commissions▌Contributed to On-Demand Production that Enables Flexible Changes to Production Quantity
Participant companies including Taisei Corporation are accelerating the development
project of “iFactory,” a convenience-store-size* continuous production facility.
iFactory is a convenience-store-size continuous production facility that is linked tomodular production equipment that combines the continuous synthesis method and batch
synthesis method. In its cube-shaped frame, the modular production equipment iCube
contains devices that enable unit operation such as “reaction,” “cleaning, changing
replacing solvent,” “crystallization,” “filtration” and “drying.” By linking them with each other,a production line can be established easily.
Since a production line can be re-established by changing the types of units and the layout
according to raw materials and production items, flexible and efficient on-demand production
becomes possible, which also contributes to a significant reduction in CO2 emissions.
* Compact and convenient size with various functions

Eight participants: Takasago International Corporation, Mitsubishi Tanabe Pharma Corporation,
Konica Minolta Chemical Co., Ltd., Yokogawa
Solution Service Corporation, TEC Project
Services Corporation, Taisei Corporation,
Shimadzu Corporation, and Mitsubishi Kakoki
Kaisha, Ltd.

ESG Section

Topi cs

Data Section

We will expand areas in which we receive orders, having high competitiveness in the field of medicine as thecore, and “life science” as the keyword. Going forward, there will be greater demand for introducing the IoT, AI,
automation, labor saving and other cutting-edge technologies for increasing the efficiency of facility operationand in production/logistics processes. We are strengthening our new proposal capabilities such as for smart
hospitals and smart factories that utilize these technologies. For example, we participated in the development
project of iFactory (see the Topics below), a drug production facility, in April 2019.
In the field of engineering, we realize high-quality facilities that are in line with customer requests by driving
consultation and conducting feasibility studies in various areas at the business planning stage, and developing
activities in various fields for proper facility construction planning.

Business Section● Expansion of orders through proposals differentiated with labor-saving technologies utilizing the IoT, AI, etc.

TA I SE I A N N UA L R E P O R T 2 0 1 9 20

Toward Sustainable Growth of the Taisei Group

Strategy for Sustainable Growth(2) Research and development into
technologies leading to higher
added value

Development of construction technologies leading to differentiation
Advanced planning technologies● Promotion of technical developments by open innovation● Further enhancement of the functions of facilities at the Technology
Center by incorporating advanced technologies●●

It is important to develop the technologies which are related to our business domains to assure our competitivenessas well. By utilizing technological innovation such as AI and the IoT, we are promoting technological development thatwould create high added value.

▌Promote Open Innovation through “Co-Creation Sessions,” “Business Matching,” Etc.
To employ cutting-edge technologies for the businesses of our company, it
is essential to promote not only our unique research and development but
also open innovation (OI) such as partnership with companies in different
industries, small-, mid-sized and venture companies.
We will keep driving OI activities through measures such as the “Co-creation
Session” to search for new business opportunities by exchanging opinionswith various companies and “Business Matching” to seek excellent
technology that satisfies our business needs.

▌Start of the Operation of the Next-Generation Research and Development Block with an

Open Laboratory to Promote Cooperation with Companies in Different Industries
The next-generation
research anddevelopment building

Open laboratory

In September 2018, we completed establishing the next-generation
research and development block with an open laboratory to promote
cooperation with companies in different industries, and the block serves as
the research and development base for the material and environment areas.
It started operations in the following month. The facility was established byremodeling an existing one. It aims to obtain the certification of “Nearly ZEB(a facility that saves energy by 75% or more).” It adopts “T-Labo.® Next,”
which is a system to control laboratory environment optimally, to centrally
manage EHS (Environment, Health and Safety), the elements required forenvironment control of the next-generation laboratory. In this way, it achievesenergy-saving while assuring the safety and health of the researchers who
work at the facility. We will start deploying the system to other researchfacilities, both new and existing.

Topi c s▌Linking Construction Machinery by Utilizing Transportable 5G Equipment
With “Odekake 5G,” portable equipment developed by SoftBank Corp., which provides a 5G service with high-quality radio waves
locally, the Company succeeded in linking the T-iROBO series construction machine system with remote and automatic control
functions, which we are currently developing (see p.37).
By utilizing 5G, which enables high-speed, low latency, large-capacity and stable communication, it becomes possible to confirm
the status of a construction site remotely in real-time during construction, control construction machinery, and monitor safety,
potentially reducing the manpower needed at construction sites in the future.

▌Creating “T-WOOD® Space,” the Largest Structure That Can Create a Space without

Any Beams or Posts in Japan with Cross-laminated Timber (CLT)At the Technology Center, we have established “T-WOOD® Space” (span 9.5m × height 9m × depth42m), the largest structure that can create a space without any beams or posts in Japan with CLT panels
made of Japanese cedar that can be sourced domestically. We used three large CLT panels (length 9m
× width 2.45m × thickness 0.21m) to create a gate-shaped unit, and connected the units to create ahuge space with a long depth. Since it is easy to assemble, it is possible to create a space with abeautiful design in a short construction period. The construction of this wooden structure was completed
in nine days.
We will actively propose the use of T-WOOD® Space by emphasizing the property of a wooden
structure for various buildings while considering the next possible target to develop a structure to make alarger space with a span of more than 12m, which will establish a new record.

21 TA I S E I A NNUA L R EPORT 2019

Inside view of T-WOOD® SpaceDigital transformation means reconstructing a management style and business process with digitaltechnology to improve corporate value. The digital transformation of Taisei Corporation consists of
two axes—: improvement of productivity through the innovation of construction production systems
and provision of high value-added solutions to customers.
To improve productivity through the innovation of construction production systems, we arepromoting labor-saving with unattended construction robots and the development of efficientconstruction technologies (see p.37) to solve the labor shortage issue of the entire constructionindustry and the effort to reform our working style (see p.55).
For the provision of high value-added solutions to customers, these days, we have been receiving
many requests to solve managerial issues by using digital technology from our customers. Taking thistrend as our opportunity, we established the AI IoT Business Committee in July 2018 and AI IoT Business
Promotion Department in July 2019 to establish a system to use internal resources across departments.
The committees understand and analyze how buildings are used after their delivery in cooperation
with Japanese and foreign IT and venture companies and demonstration tests with our customers.
While further improving the value of the solutions that we provide, we are promoting activities togenerate business opportunities and new income sources.
In the future, by integrating these two axes, we will further strengthen the existing businesses andpromote the generation of new business opportunities.
Example of solution

About the Taisei Group
Toward Sustainable Growth of the Taisei GroupThe Effort for Digital Transformation

ColumnSpecial Feature

Our challenges include how to appropriately cope with demand for the remodeling and abolishment of buildings due
to aging and shrinking population and construction needs from the mid- and long-term perspective, such as byincreasing a “compact city” (highly concentrated urban structure), and how to utilize the alliance with different
industries. The Taisei Group aims to become a flexible organization that can handle changes.

Business Section

Flexible response to new construction needs in response to changes in society
such as low birth rate and high rate of aging● Creation of business opportunities through alliances in different businessareas, etc.
● Strengthening of sales for significantly aged facilities, etc.
●

(3) Expansion of sales with aneye on the medium andlong term

Building Health Monitoring System
Tool to support a proper and swift restart ofbusiness by utilizing a highly accurate sensor

Needinspection
Cloud

Assessing the degree of the disaster
immediately after an earthquake● Notifying assessment results using email
and the cloud

Dangerous

ESG Section

Safe

●

It is possible to confirm
the status of multiple
buildings on site
immediately and remotely●

Building managers
promptly assess if it isnecessary to evacuateand decide no-entry areas■ Acceleration, distortion and tilt sensor

Occurrence of an earthquake■ Monitoring PC (Disaster Center, Disaster Control Headquarters, etc.)

Data Section●

TA I SE I A N N UA L R E P O R T 2 0 1 9 22

1Special Feature<Talk> President and Investor

Taisei Group’s Philosophy“To Create a Vibrant Environment for
All Members of Society”
Challenges and Effort for the Realization
We had a talk with Mr. Akitsugu Era, an institutional investor, regarding our effort to improvethe corporate value over the medium to long term including the Group’s contribution to thesustainable growth of society through the realization of the Group’s philosophy and theprogress of the medium-term management plan.

President and Chief Executive Officer,
Representative Director

Director and Head ofInvestment Stewardship teamBlackRock Japan

Yoshiyuki Murata

Akitsugu Era
He also serves as a member of
the CGS (Corporate Governance
System) Study Group of the
Ministry of Economy, Trade andIndustry (METI) and Companyrelated Systems, Industrial
Structural Reform and Innovation
Meeting member of the FullScale Structural Reform
Promotion Alliance led by thePrime Minister.

23 TA I S E I A NNUA L R EPORT 2019ⓒ Aihara Masaaki

About the Taisei Group
Toward Sustainable Growth of the Taisei GroupSpecial Feature
Business Section

worksite offices, I try to talk about something specific andfamiliar to employees.
Era: To create an environment that allows employees towork in a lively way, you, as the President, pay attention to
the formation of an active and transparent atmosphere,
and are creating such environment through your word
choice in everyday life and the issuance of messages.
Murata: That is right. In the recent management environment that keeps changing drastically, it is critical to share
the Taisei Group Philosophy as an unchangeable axis
among all officers and employees, and to reflect it inbusiness activities. I believe that pursuing the Taisei Group
Philosophy results in the establishment of a trusting relationship with business partners and the acquisition oftalented human resources.
Era: The recent young generation has a strong tendency
to seek social significance with their work. In that respect,
Taisei Corporation has been working on businesses that
directly contribute to society such as the generation of a
town which is resilient against disasters. How do you
publicize such businesses, the relationship with social
contribution and the effort and attitude of the company?
Murata: When I visit a worksite office, I utilize the opportunity to talk to employees directly. I have realized that more
and more young people are conscious of their contribution
to society. The Taisei Group shall aim to realize the TaiseiGroup Philosophy through various innovations, andachieve both sustainable development of the Company
and contribution to a sustainable society. This is what we
communicate in our annual report as well. I think theyounger generation is more flexible than us, and tends toaccept the idea of aiming for the co-existence of economic
and social value.
Era: I agree. We can see it in the 2030 Sustainable
Development Goals (SDGs).
Murata: So far, the construction industry has been playing
an important role in making a country robust enough toprotect people’s lives and properties from serious disasters
which are described as “unexpected” and “occurring oncein 100 years.” This is related to SDGs.
SDGs’ message, “Leave No-One Behind,” and theTaisei Group Philosophy, “To Create a Vibrant Environment
for All Members of Society,” have something in common,and I think it is important to make this type of idea known
to many people.
Era: As an investor, I have huge expectations that yourcompany will improve its corporate and social value byachieving the SDGs goals through its business activities.

ESG Section

Era: I think that the Taisei Group Philosophy, which indicatesthe group’s determination to “strive to build a global society forthe next generations by creating spaces where people andnature exist in harmony,” is wonderful because it considers
businesses and social contribution comprehensively. Could you
please tell me how the Taisei Group Philosophy was established and what your company has been doing?
Murata: First, as the foundation of the Taisei Group Philosophy, we have the idea of “Taisei Spirit,” which is describedby the words “Value Creation,” “Evolution of Tradition” and“Active and Transparent Culture.” These are embodied inour corporate culture, which has been developed since thetime of the inauguration of the Company.
The history of the Company began when Kihachiro
Okura established the Construction Department of Okura
Gumi Shokai in 1873. At that time, Japan was trying tocatch up with Western countries by actively embracing
technologies, knowledge and culture from overseas andhandling many challenges. There is a lot to learn from theproactiveness of the people during the Meiji Era. Although
we have roots in the Okura Zaibatsu founded by Kihachiro
Okura, we are no longer a family-owned company. During
the post-war period, which saw drastic changes including
Zaibatsu dissolution, employees protected the company byestablishing an employee stock ownership system. In
addition, presidents and executive officers have beenchosen based on election. I believe that the Company
history with the accumulation of events like these created an
active and transparent culture, and formed the philosophy tocreate a vibrant environment for all members of society.
Era: I have met many employees of Taisei Corporation.
Everyone is positive, and I felt there is a culture that allows
employees to speak up freely. Philosophy is not something
only to pose with, and it is important to infuse it thoroughly
within an organization.
Murata: When we seek the Taisei Group Philosophy, it isessential to have an environment that allows not only our
employees but also skilled construction workers who workwith them to work in a lively way. Taking leadership, I am
trying to act on such awareness. For example, I call my
employees’ name in a formal way in the Japanese
language, and refer to people who work at site as“craftsmen” instead of “laborer.” This is because I believethat we have to respect skilled construction workers asmuch as we can.
Moreover, we publish “Message from the President” foremployees every month. I prepare the script and write
about matters such as what I noticed when I visited aworksite office. To create a topic for casual conversation at

Data Section

The Taisei Group Philosophy and Active
and Transparent Corporate Culture

TA I SE I A N N UA L R E P O R T 2 0 1 9 24

Special Feature 1 <Talk> President and Investor

Key Measures of the Medium-term
Business Plan (FY2018 – FY2020)
Era: About the Medium-term Business Plan, which entered
its second year could you please tell me about the goals
and progress of the key measures?
Murata: We have three most crucial measures. The first is
the expansion of business scale. The second is thereinforcement of overseas business. The third is investment
for growth. We are steadily executing these measures.
Era: About the first item, the expansion of business scale,what is your idea? Do you have any target figures?
Murata: The previous Medium-term Business Plan posed agoal, “Deep cultivation of the construction industry, our corebusiness.” With the current plan, we are trying to expand thebusiness scale by enhancing the areas related to the main
business. We aim to achieve ¥1,870 billion of sales by the
final year, which is FY2020, and ¥2,000 billion in the near
future. We consider that it is important to take orders thatlast even after the Tokyo 2020 Olympics and Paralympics
Games focusing on larger scale and longer term projects.
Era: Regarding the second item, “overseas business,” does
this mean that overseas business expansion will be the key
considering the time after the Tokyo 2020 Olympics andParalympics Games while domestic demand is currently
steadily improving?
Murata: Preparing for the period when domestic demandslows down in the future, we are considering establishing
the foundation for future growth by ensuring the sustainablegrowth of the overseas business and converting our corporate
structure to one which works well in overseas markets.
Currently, we are focusing on reinforcing alliances withforeign major construction companies, carrying out urban
development projects in Southeast Asia and Taiwan andparticipating in an infrastructure export project by theJapanese government. Furthermore, we have establishedlocal subsidiaries in areas in which we can expect constantbusiness. They have a system developed to become abase for growth in the future.

25 TA I S E I A NNUA L R EPORT 2019

Since last year, the order status from overseas has
been picking up. During this fiscal year, we expect toreceive large orders. There are inevitably fluctuations in theorder volume due to factors such as the local economic
environment but we would like to keep certain level in scalecontinuously. The number of capable human resourcesthat we need will increase, so it is essential to develop
global and talented people. We would like to actively hire
not only Japanese people but also local employees, andnurture as many global managers as possible.
Era: Then, would you tell me about “growth investment”?
I am also interested in the allocation of investment.
Murata: Targeting a business foundation that allows us toachieve sustainable growth even after 2020, we will make¥300 billion of strategic investment over three years. With this,we will add high value to the construction and related
businesses and enhance the opportunities to increase income.
As for the investment allocation of ¥300 billion, ¥150
billion is allocated to strengthening overseas business andtargeted fields (“energy and environment,” “urban development and PPP,” “renewal,” and “engineering”), ¥60 billion
to investment in technical development, ¥60 billion toinvestment in work style reform and productivity improvement, and ¥30 billion to investment in human resources,development of infrastructure, etc.

Work Style Reform and Productivity
Improvement Shall Be Promoted as a Set
Era: I would like to ask about the environment surrounding
the business of Taisei Corporation. How is the demandsupply balance of the construction market and the issue ofa labor shortage?
Murata: We forecast that the demand-supply balance ofthe construction market will rather steadily improve. We
used to be concerned about the status after the Tokyo 2020
Olympics and Paralympics Games. However, since demandis expected to increase not only in the metropolitan area but
also other areas due to factors such as EXPO 2025 Osaka,
Kansai, Japan, the risk of a significant decrease in demand
will be low for the time being.
Era: These past few years, laws and regulations have beengetting tighter due to social demand to resolve the issue oflong working hours. I think how the construction industry
responds to work style reform will directly affect thesustainability of the entire industry and the competitivenessof your company. What do you think about this issue?
Murata: Without skilled construction workers, we cannot
expand our business scale. Therefore, it is an urgent task
for us to secure skilled construction workers who are
active at a worksite office.
To resolve this issue, I have been emphasizing the needto have courage to change conventional working methods.

About the Taisei Group
Toward Sustainable Growth of the Taisei GroupSpecial Feature
Business Section

The important point, however, is that we do not let
human beings and robots compete with each other;instead, skilled construction workers shall master how to
use robots to improve productivity. As for the investment insuch technological foundation, we utilize many comments
and ideas of our partner companies and promote
investment by cooperating with each other. I think it is oneof our roles.
The most important key to future growth is productivity
improvement. Now we have the best opportunity tocontemplate the technologies and production methods
which are suited to the times. In addition to work stylereform, the entire Company is working on this.
Era: That is exactly the courage to change. I think it is
crucial to have leadership in management to resolve social
issues such as SDGs through ESG-conscious management.
This interview has made me fully understand President
Murata’s idea to realize the Taisei Group Philosophy, “To
Create a Vibrant Environment for All Members of Society,”and how Taisei Corporation foresees the direction of society
and develops its management strategies based on it.

ESG Section

Postscript after the Talk
President Murata has experience in dealing with various culturesand businesses having been stationed in Kuala Lumpur, Malaysia
and handled the detached house business. I could see that overthe course of his career, he has learned to become morecourageous, active and decisive. Through the talk, I could see that
his management capability which has been developed through his
experience is serving as a significant driving force for the realizationof the Taisei Group Philosophy and the fostering of global humanresources. I hope he keeps sending out his message based on
the Taisei Group Philosophy. (Era)

Data Section

We are working on work style reform and productivity
improvement by treating them as a set. Work style reformand productivity improvement do not contradict each other.
We need to reform our work style to improve productivity.
Unless we achieve the same level of working
environment as those of other industries and make theconstruction industry attractive, there is no future for theindustry. Our ability to establish a new production system
will decide the destiny of the Company. Therefore, we, as
the whole Company, need to tackle and overcome thisissue. Currently, worksite employees are very busy. So, wetake a flexible approach to staff allocation, such as bysending employees from support organizations at the head
office to assist them and handle projects utilizing all of ourhuman resources.
Moreover, according to research by the Cabinet Office,“if women play an active role, the GDP of the country will
increase.” We would like to establish a system to bring out
the abilities of female employees by expanding their work
fields and formulating an attractive career plan.
Era: Taisei Corporation has started fully operating its
Construction Career Up System this year. Is this part ofyour effort for work style reform?
Murata: Yes, it is. The Construction Career Up System is
one to visualize the qualification and working history ofskilled construction workers using an industry-standard
framework. For skilled construction workers, the system
could result in improving their treatment because of aproper assessment of their abilities and experience that isrecorded and accumulated in the system. This could
contribute to the securement of human resources for theconstruction industry over time. We will first install a card
reader for each worksite office whose construction
amount is ¥100 million or more. In the future, we will
provide a card reader to all worksite offices. We will also
take the initiative and encourage partner companies tointroduce the system.
Moreover, at the building department, we are improving
the productivity of design and construction by promoting
the digitalization of a construction management systemsuch as Building Information Modeling (BIM) to allow
worksite employees to concentrate on quality and safety
management fully. Therefore, we established the Digital
Product Center in the head office to centralize tasks
related to drawings.
Era: For work style reform and productivity improvement,
technological innovation such as the IoT and robots plays
a significant part, does it not?
Murata: Technological innovation makes many impossible
things possible. We want to actively make a shift in areasthat are handled better by robots than human beings, suchas simple tasks and heavy labor.

TA I SE I A N N UA L R E P O R T 2 0 1 9 26

2Special Feature

External Board Members’ Discussion

By Reinforcing Governance while Listening
to Various Opinions, Develop Prospects for
the Future of Taisei Corporation
Three external Members of the Board, who have been widely active in company management andofficial duties, talked about the governance of Taisei Corporation that they noticed, observing how
the Board is functioning and the vision of our sustainable growth in Japan and overseas.

External Member of the Board

External Member of the Board

External Member of the Board

Toru Tsuji

Fumio Sudo

Atsuko Nishimura

Profile
1961
1999
2003
2008
2011

Joined Marubeni-Iida Co., Ltd. (current Marubeni
Corporation)
President and Chief Executive Officer,
Representative Director
Chairman of the Board, Representative Director
Corporate Advisor, Member of the Board
Member of the Board, Taisei Corporation(incumbent)

Concurrent positions
June 2008 – June 2012 External Member of the Board,
Konica Minolta Holdings, Inc.
June 2008 – June 2013 External Member of the Board,
Sekisui Chemical Co., Ltd.

Reason for appointment
Rich experience as top management of a general
trading company and a global point of view

* Mr. Tsuji and Mr. Sudo had served as directors foreight years since their inauguration in 2011.
However, they resigned as directors in June 2019.

27 TA I S E I A NNUA L R EPORT 2019

Profile
1964
2001
2002
2003
2005
2010
2011

Joined Kawasaki Steel Corporation (Current JFE SteelCorporation)
President and Chief Executive Officer, Representative
Director
Member of the Board of JFE Holdings, Inc. (Part-time)
President and Chief Executive Officer,
Representative Director of JFE Steel Corporation
President and Chief Executive Officer,
Representative Director of JFE Holdings, Inc.
Honorary Advisor
Member of the Board of Taisei Corporation (incumbent)

Concurrent positions
External Member of the Board, JS
Group Corporation (current LIXILGroup Corporation)
June 2010 – Present
External Member of the Board, New
Otani Co., Ltd.
April 2011 – May 2012
Chairman of the Management Committee,
Japan Broadcasting Corporation
June 2011 – June 2017 External Member of the Board,
Takeda Pharmaceutical Company
LimitedJune 2012 – March 2014 External Member of the Board, Tokyo
Electric Power Company (current Tokyo
Electric Power Company Holdings, Inc.)
April 2014 – June 2017
Chairman of the Board, Tokyo ElectricPower Company Holdings, Inc.

Profile
1979
1999
2001
2004
2008
2012
2014
2016

June 2010 – June 2016

Reason for appointment
Rich experience as top management of a number of companies

2017

Joined the Ministry of Foreign Affairs
Counselor/Minister, Permanent Mission ofJapan to the United Nations
Envoy, Embassy of Japan in Belgium
Professor, Graduate School of Law,
Tohoku University
Administrator, the Japan Foundation
Adviser Extraordinary, Japan Oil, Gas
and Metals National Corporation
Ambassador Extraordinary andPlenipotentiary, Embassy of Japan in
Luxembourg
Ambassador Extraordinary andPlenipotentiary, in charge of Women,
Human Rights, and Humanitarian Affairs
External Member of the Board, Taisei
Corporation (incumbent)

Concurrent positions
June 2017 – Present External member of theBoard, INPEX Corporation

Reason for appointment
A broad range of insights, international sense, andobjective point of view based on many years’
experience as a diplomat

and overseas. I always try to suggest the direction of thehas happened from the viewpoint of both aggressive

management strategies and offer advice for the smoothgovernance to develop new management strategies for

operation of each business from a different viewpoint fromsustainable growth and the improvement of corporate value

those of internal Members of the Board.

for a long time to come and defensive governance such as

Sudo: In 2017, the number of External Members of thecompliance and internal control, which serves as theBoard was changed to three. Taking that opportunity, threefoundation of the aggressive governance. To ensure the Boardof us started having an extra meeting on a day when thefunctions effectively, I feel a great responsibility.

Board is not held. We receive a briefing on proposals fromTsuji: External members of the board are, after all, members

responsible officers, and the External Members of theof the board. So, we have the same role as internal Members

Board exchange opinions. Rather than receiving theof the Board, and need to promote the growth of a company

briefing individually, we can come up with a greater variety

and the improvement of corporate value. We need to fulfillof ideas, and the system allows us to provide more specificthis responsibility accordingly. I provide my advice to theadvice to the Board. We see some proposals are fully

Board from a global perspective based on experience being

discussed internally in advance and submitted only toengaged in the management of a general trading company

receive approval. I think we can provide better advice if we

for many years.

are informed about the content of the discussion at thetime of this briefing.
Nishimura: I agree. Looking back on the past year, I think

About the Taisei Group

external members of the board have been increasing. This

Toward Sustainable Growth of the Taisei Groupand being engaged in various areas and activities in Japan

Special Feature

Nishimura: Recently the expectations for and interest inthat we have been sharing more information than before.
At the Board, we conduct deliberations by fully

ESG, which is viewed as one of the most crucial social
issues in the world, and compliance, which is a prerequisite
for corporate activities. The specific measures to improve

Business Section

recognizing the importance of reinforcing the response toawareness, establish and reinforce rules are becoming
stricter than before.

supported by society. We, the external Members of thethe check function is working properly. My view is that theBoard, are elected based on a resolution of a generalCompany is striving to conduct efficient and effective

shareholders meeting of shareholders. Therefore, we need tocorporate governance.

sincerely respond to the expectations of shareholders and all

Tsuji: It has been eight years since I was appointed asother stakeholders. This is the role of the external Members

External Member of the Board of Taisei Corporation. Theof the Board. Especially during a time like now when things

Board started having lively discussions about management

keep changing drastically, it is important to confirm the validity

issues. Each executive officer presents his or her idea withof business judgments and decision-making by ensuring

a critical mindset as a professional. While the President

accountability and conformance to social requirements.

welcomes a variety of opinions, he has clear basic policies.

Nishimura: I have experience and knowledge

Through discussions, I believe an appropriate conclusion

accumulated by acting as a diplomat for nearly 40 years

is delivered.

ESG Section

As some proposals are deliberated on again if necessary,

Data Section

Sudo: A company is an entity that has a social status and is

TA I SE I A N N UA L R E P O R T 2 0 1 9 28

Special Feature 2 External Board Members’ Discussion

Nishimura: While the Company proceeds with overseas
expansion and strategic growth investment for the future,
we are dealing with unconventional business models anddiversified and complicated business forms. Under thecircumstances, it is necessary to focus on reinforcing
compliance more than ever.
Tsuji: I think so, too. When we reinforce officers’ andemployees’ compliance, it is important to repeatedly andsuccessively plan and execute activities to raise awarenessSudo: I agree that the Board has an open culture. When
we are going to take advantage of this merit, it is importantto create an environment that encourages a bottom-up
approach in addition to a top-down one. I think thatgovernance and compliance are reinforced through a directconversation between the top management members andthe employees who are active on the front lines. I always
pay attention to this part, and try to check it.
Tsuji: Japanese major construction companies have aunique business style, which cannot be found in Europe
and the United States. The capability of Japanese major
construction companies which can comprehensively handle
technology research and development, design andconstruction is very promising.
One of the current major themes for Taisei Corporation
is overseas expansion. I want to see the employees actively
tackle this challenge. I do not mean to encourage theCompany to expand abroad because of shrinking domestic
demand, but I want Taisei Corporation to grow as a real
global company. Therefore, important tasks include
securing employees, developing human resources andmanaging risks, and we can provide various proposals.
Sudo: In addition, as for overseas expansion, I think we
can start seeing many things by steadily working on smallsized projects. There are times that we are in conflict with acustomer. However, we can learn from those kinds ofincidents, and grow bigger.

29 TA I S E I A NNUA L R EPORT 2019such as through education and training.
Nishimura: Since various changes are speeding up,
unimaginable things may be happening in ten years’ time.
In addition, society will find the Taisei Group Philosophy,“To Create a Vibrant Environment for All Members ofSociety,” more meaningful than ever.
I want Taisei Corporation to take the initiative andtackle issues that the construction industry is facing suchas work style reform, productivity improvement and humanresource development. In ten years, I want it to shine as an
attractive company by realizing a workplace that allows
various talented people to work in a lively way, actively
working on the development of innovation and presenting
the solutions to various social issues.
Sudo: During the Heisei era, every industry regardless of
their type experienced reorganization. Even if the constructionindustry goes through full-scale reorganization in the future,
I want Taisei Corporation to take the lead in the movement.
To do so, I hope it will enhance its presence to achieve abusiness scale of ¥2 trillion.

What major construction companies produce is buildings and infrastructure. The parties thatplace an order are mainly private companies, the central government and public agencies, and“people” are always involved as an end-user. By utilizing “the eyes to watch people’s lives”
which were developed by managing a beverage manufacturer, a BtoC company, I would like toparticipate in discussions about realizing the Taisei Group Philosophy, “To Create a Vibrant
Environment for All Members of Society,” the effort to achieve SDGs, which is the common goal
for all mankind, compliance with laws, regulations and public morals, etc. to meet the
expectations of all stakeholders.

External Member of the Board of
Television Hokkaido BroadcastingCo., Ltd
External Audit & Supervisory Board
Members of FUJIO FOOD SYSTEM
Co., Ltd

External Memberof the Board

Takao
Murakami

Reason for appointment
Rich experience in managing
multiple companies

Profile1973.04: Joined NSK Ltd.
2000.04: Executive Officer
2002.06: Managing Executive Officer, Memberof the Board
2004.06: Senior Managing Executive Officer,
Representative Director
2007.06: Executive Vice President,
Representative Director
2009.06: President and Chief Executive Officer,
Representative Director

Concurrent positions
2015.06: Chairman, Member of the Board
2017.03: External Member of the Board ofShowa Shell Sekiyu K.K.
2018.06: Advisor of NSK Ltd. [Present Position]
2018.06: External Member of the Board ofSojitz Corporation [Present Position]
2019.04: External Member of the Board ofIdemitsu Kosan Co., Ltd. [Present
Position]

External Member of the Board ofIdemitsu Kosan Co., Ltd.
External Member of the Board ofSojitz Corporation

Reason for appointment

Special Feature

In 2018, the Corporate Governance Code was revised. The level of the governance systemthat companies are required to have is becoming more demanding every year. Over many
years, I have been engaged in reinforcing the governance system as a manager of a bearing
company. The crucial point is not the arrangement of a system, but the healthy and effective
operation as well as the improvement of corporate value and sustainable growth based onstrong governance. By providing adequate and practical advice at the Board, I would like tohelp further reinforce governance. In addition, through my work, I would like to see the Board
serve as an organization to make transparent and objective decisions swiftly.
External Memberof the Board

Norio
OtsukaRich experience in managing
multiple companies

Profile1975.04: Joined Marubeni Corporation
2005.04: Executive Officer
2008.04: Managing Executive Officer
2008.06: Managing Executive Officer,
Representative Director
2010.04: Senior Managing Executive Officer
2012.04: Executive Vice President

Concurrent positions
2012.06: Executive Vice President,
Representative Director
2013.04: President and Chief Executive Officer,
Representative Director
2019.04: Chairman, Member of the Board[Present Position]

Chairman of the Board of Marubeni
Corporation

Reason for appointment
Broad insight and an international
perspective as the top managementof a general trading company

ESG Section

Taisei Corporation poses “the sustainable growth of the overseas business” as one of the
management tasks of the Medium-term Business Plan formulated in 2018. As a manager ofa general trading company, I have been facing various risks and challenges such as how tohandle foreign business customs and foreign cultures that are different from those of adomestic business. For a company to grow, it is necessary to evaluate those risks frommultilateral viewpoints and manage them effectively. To strengthen a risk management
system for the growth of the overseas business, as a director of the Company, I would liketo actively express my opinions based on my knowledge and experience, and contribute to
the sustainable growth of the Company.

Business Section

Concurrent positions
2011.03: Chairman of the Board,
Representative Director
2011.06: External Member of the Board of
Television Hokkaido BroadcastingCo., Ltd [Present Position]
2014.03: External Audit & Supervisory Board
Members of FUJIO FOOD SYSTEM
Co., Ltd [Present Position]
2018.03: Honorary Counsellor of Sapporo
Holdings Limited [Present Position]

External Memberof the Board

FumiyaKokubuData Section

Profile1969.04: Joined Sapporo Breweries Limited(Present: Sapporo Holdings Limited)
1999.03: Executive Officer
2001.03: Managing Executive Officer
2003.07: Member of the Board; Senior Managing
Executive Officer of Sapporo Breweries
Limited (new company)
2004.03: Managing Executive Officer, Member ofthe Board of Sapporo Holdings Limited
2005.03: President and Chief Executive Officer,
Representative Director, Group CEO

Toward Sustainable Growth of the Taisei GroupWe received messages from three newly appointed external members of the board of Taisei Corporation in June 2019.

About the Taisei Group

Messages from Newly Appointed External Members of the Board

TA I SE I A N N UA L R E P O R T 2 0 1 9 30

Special Feature

1

3

Taisei Corporation’s Efforts toRealize a Sustainable Society

SDGs Dialogue

The Possibility of Regional Revitalization
and Value Creation through Concession

Inviting Mr. Hidemitsu Sasaya, a visiting professor of the Graduate School of Information &Communication, who has deep insight into SDGs, the Chief and four members of the Urban
Development Division, which is responsible for tasks related to airport concession and town
planning, exchanged opinions having “Regional Revitalization and SDGs” as a theme.

Facilitator
Urban Development Div.
Property Management
Business Dept.
Assistant Manager

Urban Development Div.
Property Management
Business Dept.
Chief Manager

The Graduate Schoolof Information &Communication
Visiting Professor

Senior Managing
Executive Officer;
Chief of Urban
Development Division

Mai Yamamura

Hideaki Okamoto

Mr. Hidemitsu
SasayaKatsuyuki Kanai

Fukuoka International
Airport Co., Ltd.
(Assigned employee)

Takamatsu Airport
Co., Ltd.
(Assigned employee)

Takuya Hara

Hideaki Kita

(Director of Sustainability
Forum Japan, Director ofJapan Society for Business
Ethics, Former Corporate
Adviser of ITO EN LTD.)

SDGs in Japan“Good for the Seller, the Buyer and Society”
Sasaya: Today’s theme is regional revitalization and SDGs.

seller, the buyer and society).” So, in Japan, people have

I interpret the word, “regional” not as “local” but asbeen familiar with the concept of modern SDGs for a long“community.” The revitalization of a community is an effort

time. On the other hand, investors are watching whether

to activate all areas including urban areas. Airports thatcompanies conduct business in the “Good for three parties”

Taisei Corporation are handling would be the symbol.

style, using this aspect as a standard for selecting

SDGs are advocated to strengthen the contact point

investment targets. ESG investment that focuses on the

between society and companies. Japanese people have aenvironment, society and governance is rapidly increasing.

traditional idea of “Good for three parties (Good for theUnder these circumstances, SDGs were introduced in 2015.

31 TA I S E I A NNUA L R EPORT 2019

Goal 12
Ensure sustainable consumption
and production patterns
We set up the “Shinjuku Subcenter Area Environmental Improvement
Commission,” which consists of a total of 16 organizations including
companies and universities that have their head office or base in
Nishi-Shinjuku to strengthen cooperation with the public sector andcommunities. Through the implementation of various events, etc., weare helping to increase the value of the entire Nishi-Shinjuku area.

SDGs and Regional Revitalization
Sasaya: SDGs are considered one of the important topics
that anyone in the world would cite.
In Japan, achievement of the SDGs is clearly stated in
the procurement code of the Tokyo 2020 Olympics andParalympics Games, which pays attention to sustainability,
as well as in the purpose of convening EXPO 2025 Osaka,
Kansai, Japan.
In addition, while SDGs are widely spread in society and

The Graduate School ofInformation & Communication
Visiting professor

Mr. Hidemitsu Sasaya

becoming the mainstream, the Japanese government isimpression with a number of unique buildings and attracts

setting out an action plan, “Regional revitalization having

people. To this end, we are effectively using a plaza, andSDGs as a driver, and development of robust andconstructing an atrium with a large roof and an art

environment-friendly communities.” Taisei Corporation,museum, the base for arts. Since the successful result

which is engaged in urban planning, will have a lot to do

attracted people’s attention, we established the Urban

with regional revitalization which uses SDGs as a driving

Planning Promotion Office, which handles the revitalization

force as a company that stays close to each party thatof towns and area branding, in April 2018. Currently, it isplaces an order for a large-scale project and that affects theworking on measures to resolve issues and improve thepeople concerned.

value of areas including Sapporo, Sendai, Hiroshima andKanai: I acknowledge that regional revitalization is one of

Fukuoka. Our participation in Takamatsu airportthe most important tasks of the Urban Development

concession, which promotes the revitalization of the airport

Division. In Nishi-Shinjuku, by cooperating with local

and surrounding areas (see Column ❷) is a typical example

companies, universities and public agencies, we areof our effort for regional revitalization. The construction

promoting measures to help improve the value of the entire

industry is a contract-based business, which is susceptible

Nishi-Shinjuku area (see Column ❶). We are aiming to

Toward Sustainable Growth of the Taisei Group

About the Taisei Group

Making Nishi-Shinjuku look more attractive

to economic fluctuations. To aim for sustainable growth ofconvert an area with car-centric roads and skyscrapers of a

the Company, as the Medium-term Business Plan states, inwide variety of designs that sporadically spread into a

addition to our core construction business, we need to add

pedestrian-friendly fascinating town that gives a unified

high value to related businesses and enhance theSpecial Feature

Make cities and human settlements
inclusive, safe, resilient andsustainable

Business Section

Goal 11

Column ❶ESG Section

SDGs Goal 11, 12

opportunities to increase income. I believe an airport
concession is one of the specific measures to achieve them.
The style of these measures is not a conventional “effort inis so to speak business innovation. Through many PFI
Senior Managing
Executive Officer;
Chief of Urban
Development Division

Katsuyuki Kanai

projects that we handle, particularly the case of Ehime
Prefectural Central Hospital, in which we conducted some

Data Section

the background.” They shall promote our business. So, this

hospital management (see Column ❸), we have obtained
know-how in the public facility management business.

TA I SE I A N N UA L R E P O R T 2 0 1 9 32

Special Feature 3 Taisei Corporation’s Efforts to Realize a Sustainable Society
Column ❷Column ❸Takamatsu Airport Specific Business Operation Business (Concession)

PFI Project of Ehime Prefectural Central Hospital

In April 2018, we started Takamatsu Airport operation business incollaboration with Mitsubishi Estate Co., Ltd., etc. This business utilizes
private funds and management capabilities and conducts integrated andagile airport management to invigorate the airport and surrounding facilities.

It is a PFI project to handle maintenance, management and operation of
Ehime Prefectural Central Hospital until March 2033. By utilizing theknow-how and creativity of a private company, we efficiently provide
quality and stable hospital operation services.

SDGs, the Common Language which
Links the Company and External Parties
Sasaya: Especially the content of SDG 11, “Sustainable
Cities and Communities” is valuable as a reference when
we think about the sustainability of the main entities of acommunity such as airports and hospitals, which are thebusiness target of Taisei Corporation. In which part of yourdaily business, do you feel that it is related to regional
revitalization and the achievement of SDGs?
Kita: I am responsible for the revitalization of the sightseeing
business and promotion to attract people for Takamatsu
Airport concession (see Column ❷). I am also working on
enhancing airport bus services. I think this is related to SDG
11 “Safer transport” and “Provision of access to asustainable transport system.” My tasks, how to increase
the number of customers and make the airport andsightseeing business thrive, are closely related to SDGs.

Okamoto: Through the experience of being engaged in theoperation company of Ehime Prefectural Central Hospital(see Column ❸), to continue operating for 20 or 30 years
as important life infrastructure for the community, it is
crucial not only to maintain hardware but also to keep thelevel of software including safety, ease of mind andconvenience over a certain level through proper operations.
Moreover, to be responsible for a hospital, which offers
peace of mind to local residents, I found my task
emotionally rewarding because I can contribute to regional
revitalization and community invigoration.
Yamamura: The actual implementation of the NishiShinjuku area management (see Column ❶) is relevant to
SDG 12, “Responsible consumption and production.” Theparty that considers urban planning has a responsibility todemonstrate how to use infrastructure. When I saw thatpeople enjoy coming to Nishi-Shinjuku because of our plan,
I felt that we could contribute to the formation of civic pride(pride in and attachment to the city).
Sasaya: I think it is quite effective to publicize how Taisei
Corporation is thinking and working on the revitalization ofcommunities in the way that people can easily understand,and use SDGs as a common language to promote internal

Takamatsu Airport Co., Ltd.
(Assigned employee)

Hideaki Kita

awareness reform. By making SDGs a common language,
based on values regarding sustainability, I think that we caneffectively obtain cooperation internally and be approachedby external parties.

Hara: Like Takamatsu Airport, the Fukuoka Airport
concession is also relevant to SDGs. Since the airport islocated in an urban area, the advancement of the airportand local communities are directly related, so carrying out
the task gives me a sense of satisfaction. To improve not
only the hardware aspect of buildings but also the software
function that is required by users, I think we can create newvalue to contribute to the achievement of SDGs by
constantly listening to the opinions of local communities.

33 TA I S E I A NNUA L R EPORT 2019

Fukuoka International
Airport Co., Ltd.
(Assigned employee)

Takuya Hara

Future Potential of Airport Concession
Okamoto: Airport concession involves activities in which
we can contribute to the revitalization of local communities
if our efforts to use our intelligence and make attractive

Urban Development Div.
Property Management
Business Dept.
Chief Manager

facilities utilizing the characteristics of the local communities
deliver results. We can achieve efficient operation of an

Hideaki Okamotoattractive airport.

About the Taisei Group

Sasaya: Could you tell us about future development?

government has set the goal of increasing the number of
inbound travelers to 60 million by 2030. It is important for
both airports and local communities to warmly welcome
those people, and utilize the opportunity to revitalize thelocal communities.
I think an airport can connect people who are in avariety of positions equally for the revitalization of thelocal communities.

become No. 1 international airport in the Shikoku-Setouchi
area in a true sense.
Kanai: As for airport concession, we are considering
expanding overseas, especially to Southeast Asia in the
future. To do so, we are accumulating operational know-how
and knowledge in Takamatsu and Fukuoka.
Taisei Corporation has other departments that cancontribute to society through new businesses related toregional revitalization in addition to the Urban Development
Division, such as the Energy Division and the Environment
Division. I think that the Urban Development Division has aduty to provide these departments with opportunities totake an active role.

Urban Development Div.
Property Management
Business Dept.
Assistant Manager

Mai Yamamura

Understanding the Philosophy behind SDGs
Sasaya: As Taisei Corporation publicizes its social
activities, we can increase our allies and create innovation.
SDGs consist of 17 goals and 169 targets, and they

Hara: Since it is a facility in which all kinds of people

present the idea of 5 P’s to assist in understanding.

interact with their own opinions, as Mr. Sasaya says, it is an•Peopleappropriate idea to have SDGs as a common language for•Prosperity

everyone to pull in the same direction and expand the•Planetpossibility of airport concession.

•PeaceKita: Takamatsu Airport aims to handle 3.07 million•Partnershippassengers in 2032. Since it recorded about 2.05 million

With 17 global goals, we will resolve the issues of the 5people in 2018, it is a very ambitious target. It has

P’s. To utilize SDGs, I expect everyone at Taisei Corporation

established a council which consists of the local

to understand not only the definition of the terms andgovernment and economic organization to make ainterpretation but also the philosophy behind the SDGs,

concerted effort to achieve the goal. As for the airport bus

work on urban planning and regional revitalization

services, it is implementing measures to enhance thepresenting ideas and proposals, and contribute greatly toservices not only for sightseeing but also as the transport of

the realization of the future that SDGs aim for.

local residents by extending the services to sightseeing
spots and stations other than those in Kagawa Prefecture.

Special Featurefacility that provides people with many dreams. The

promote interaction among people, and we will be able toBusiness Section

point for people to pass although it could be a fantastic

Ideally, increasing both inbound and outbound, it will

ESG Section

country for the first time. I think it is sad if we make it only a

Data Section

case of inbound, it is a place for people to learn about the

Toward Sustainable Growth of the Taisei Group

Yamamura: An airport is a starting point of travel. In the

TA I SE I A N N UA L R E P O R T 2 0 1 9 34

Special Feature 3 Taisei Corporation’s Efforts to Realize a Sustainable Society

2

SDGs

ZEB

Japan’s Top-Class ZEB Public Facility

Aichi Environmental Research Center & Aichi Prefectural
Institute of Public HealthAs a resilience strategy to contribute to the achievement of SDGs, we promote ZEB (zero energy
building), which has the potential to impact on society.

For the Achievement of a Sustainable and Environmentally Friendly Society
As energy issues and global warming caused by increasing CO2 emissions have become
Reduction ofserious social issues, Taisei Corporation has been committed to the diffusion of ZEB since its
primary energy
early stage. ZEB reduces the energy consumption of an entire building by paying attention to
consumption
the environment during construction starting from the design phase, and saving energy using
energy creation systems such as solar power while keeping the indoor environment comfortable.
The popularization of ZEB is an important step toward achieving Japan’s 2030
greenhouse gas reduction target of 26% (compared to 2013), which was registered under
the Paris Agreement. In addition, it is included in SDGs Action Plan 2019 established by
the Japanese government as a measure tocontribute to the realization of SDGs.
Position in ZEB Chart
Aichi Environmental Research Center & Aichi
0.5
Prefectural Institute of Public Health is Japan’s
top-class ZEB public facility. It also obtained the
0.375
highest rank of five stars under the Building-Housing
Aichi Environmental Research Center &Aichi Prefectural Institute of Public Health『ZEB』
Energy-Efficiency Labeling System (BELS*1)
0.25
established by the Ministry of Land, Infrastructure
Energy creation
and Transport, and was certified as the first ZEB
Nearly+28%
ZEB(Nearly ZEB*2) public research facility in Japan.
0.125
Energy saving
The building has adopted various energy
ZEB–57%
saving and creating facilities. It reduces primaryReady0energy consumption by 57% compared with
0.000
0.125
0.250
0.375
0.500
0.625
0.750
0.875
1.000
standard buildings, and produces 28% of its
Energy savingenergy with a solar power system. Overall, it
achieved an 85% reduction in primary energy
consumption (BEI*3=0.15).
Energy creation–85%

Definition of ZEB

Building that saves energy by 100% or more
Building that saves energy by 75% or more
Building that saves energy by 50% or more
Use ofbuilding

Office, school, factory, etc.
40% or more (excluding created energy) + experimental technology

As defined in ZEB’s quantitative
criteria by the Agency for Natural
Resources and Energy of the
Ministry of Economy, Trade andIndustry, ZEB levels are categorizedbased on annual primary energy
consumption volume.
In March 2019, “ZEB Oriented” (forthe buildings with a total floor area of
10,000 m2 or more only) was added.

Hotel, hospital, department store, etc. 30% or more (excluding
created energy) + experimental technology*1 An abbreviation of “Building-Housing Energy-Efficiency Labeling System.” It is a third-party certification system specialized in the energy saving capability of a structure establishedby the Ministry of Land, Infrastructure and Transport. Based on the calculation method defined by the government, BEI (Building Energy Index) is determined. Based on this value, it
is given a rank of between one and five stars. The highest rank is five stars. Among the five-star buildings, those with the highest energy saving capability are certified as ZEB.
*2 It is a building that is very close to ZEB, satisfies ZEB Ready requirements and has reduced annual prime energy consumption volume to almost zero by utilizing renewableenergy. It should fulfill the following two points: ① reduction of standard primary energy consumption volume by 50% or more (excluding renewable energy), and ② reduction ofstandard primary energy consumption volume by 75% or more and less than 100% (including renewable energy).
*3 An abbreviation of Building Energy Index (designed primary energy consumption volume/standard primary energy consumption volume).

35 TA I S E I A NNUA L R EPORT 2019

Goal 11

Ensure access to affordable,
reliable, sustainable and modern
energy for all

Make cities and human settlements
inclusive, safe, resilient andsustainable

Goal 12Goal 13

Ensure sustainable consumption
and production patterns

Take urgent action to combat
climate change and its impacts

During the same period, Taisei Construction steadily built up a track record in the construction of commercial ZEB
facilities such as the New Head Office Building of Kinki Sangyo Credit Union (Chuo-ku, Osaka) (see p.8) and thenext-generation research and development block in our Technology Center (see p.21) to accelerate the popularization.
Our ZEB measures are the culmination of our accumulated efforts over many years to develop environmental
technologies to mitigate the impact of society on the environment. Resulting technologies are immediately utilized indesign and construction.
As a resilience strategy to contribute to the achievement of SDGs, we promote ZEB measures, which have thepotential to impact on society.

Toward Sustainable Growth of the Taisei Group

Goal 7

About the Taisei Group

SDGs Goal 7, 11, 12, 13② Air-conditioning system that utilizes theheat of well water
By introducing heat pump chillers and watercooled multi air conditioners for the building,the energy consumption of the air
conditioning system was reduced.

③ Light and ventilation control with anext-generation human detection system
By adopting T-Zone Saver, a system that
automatically controls light and ventilation
depending on the presence of people,
comfort was also improved.
④ Photovoltaic power generation system
was installed
For the photovoltaic power generation
system, monocrystal photovoltaic power
generation was adopted on the roof, on the
ground on the premises, and on part of thewall on the south side. In addition, on thewall on the south side, a see-through typephotovoltaic power generation system wasinstalled to generate energy effectively.

⑤ Creation of comfortable space withnatural light coming from windows
A see-through type photovoltaic power
generation system was set above and below
the windows of the wall on the south side.
By maintaining the view and light, acomfortable space was created.
⑥ Introduction of air-conditioning system toreduce the burden of using outside air
By introducing Cool Pit, a technology thatutilizes natural energy, focused on theproperties of underground heat, and ahigh-speed VAV system in the draft chamber,the burden of using outside air was reduced.

④

① ②

⑤

Business Section① Two-source hot water recovery GeneLink
The building adopted a “two-source hotwater recovery GeneLink,” a gas absorption
water chiller-heater to reduce the consumptionof town gas, which is the main heat source.

Special Feature

Energy Saving and Creating Technology of Aichi Environmental Research Center & Aichi Prefectural Instituteof Public Health

ESG Section

④
④

③
⑥

Overview of construction project
Client:Designer:

Aichi Prefectural Government*4(Basic) Kume Sekkei Co., Ltd.
(Implementation) Taisei Corporation

Data Section④

Maintenance /management: Taisei-Yuraku Real Estate Co., Ltd.
Construction
period:October 2017 to December 2019
*4 PFI project (BTO system)

TA I SE I A N N UA L R E P O R T 2 0 1 9 36

Special Feature 3 Taisei Corporation’s Efforts to Realize a Sustainable Society

3

TAISEI i-Innovation®

Development of Efficient Labor-Saving
Technology to Resolve Social Issues

With TAISEI i-Innovation®, Taisei Corporation is promoting greater work efficiency byimplementing labor-saving with robots at construction sites and introducing artificial
intelligence (AI). In this way, we will contribute to the achievement of SDGs.

Case ❶

Case ❷

Unattended Heavy Construction Machinery andAutomation Technology
Launched the Development of the Next-Generation
Hydraulic Shovel for the Automation of Work

Development of Tunnel Face Projection
Mapping for Mountain Tunnel Construction

Aiming to develop technology for unattended construction heavymachinery, we started developing technology to automate
processes such as digging and loading using the next-generation
hydraulic shovel, Cat320, made by Caterpillar Japan LLC as abase machine. We shall pushforward with technologicaldevelopment phase by phasehaving the realization of
unmanned construction
using automatically linked
construction machinery at a
certain size of a construction
site as our final target.

In cooperation with Fuji Technical Research Inc., Mac Co., Ltd.
and Furukawa Rock Drill Co., Ltd., we developed equipment
to project life-sized photographs and sketches of the groundand information such as the hardness of the ground using thetunnel face as a screen
during mountain tunnel
construction. The
technology enables
workers to share thelatest groundinformation in real time,and improves worksafety and efficiency.
Ground information projected onto the tunnel face

Automatically controlled digging andloading processes

Case ❸

Case ❹

Unattended Construction Robot Technology
T-iROBO® Series

Construction Production System
BIM and T-CIM®

To utilize robots for work, we promote the development ofvarious types of unattended construction robot technology(T-iROBO series). We have planned and developed about ten
models as the T-iROBO series including robots to reduce
workers’ burdens and those to assist skilled workers’ tasksuch as welding.
We will advance the development of efficient labor-saving
technology by promoting the introduction of automatedremote control-type construction machinery and robots atconstruction sites
and consider
automation bylinking various typesof construction
machinery and AI in
the future.

BIM is a construction information database which links a 3D
building model created with a computer and attributeinformation including the specification, layout and cost ofbuilding components and equipment. We are actively promoting
the development of T-BIM 5D, which is a construction
management support system that is capable of managing work
progress and cost. T-CIM is our proprietary system thatsystematizes CIM, information and communications technology
promoted by the Ministry of Land, Infrastructure and Transport
and Tourism. We are introducing and operating our proprietary
T-CIM series such as management methodology, the T-CIM/
concrete stacking management system, at each worksite office.

Concrete floor finishing robot
T-iROBO® Slab Finisher

37 TA I S E I A NNUA L R EPORT 2019

BIM model of Technology Center T-CIM® Bridge for bridge construction siteZEB Verification BuildingMake cities and human settlements
inclusive, safe, resilient andsustainable

Goal 13

Goal 17

Take urgent action to combat
climate change and its impacts

Strengthen the means of implementation
and revitalize the global partnership forsustainable development

Case   ❺

Case   ❻Development of Technology to Forecast Wind
Environment Surrounding Building with AI

3D Printer for Construction
Development of T-3DP (Taisei-3D Printing)

For the wind environment surrounding a tall building which has
been recreated with a model experiment and computer
simulation, we developed technology to make a forecast in ashort time using AI. In the future, we will further improve theforecasting accuracy of
the wind environment
using this technology. By
positioning it as a design
support tool that takes
the wind environment into
account, we will actively
deploy it.

In cooperation with AKTIO Corporation, the National Instituteof Technology, Ariake College and Taiheiyo Cement Corporation,
we developed a 3D printer for construction which uses
cement-based material. With this, formwork which used to be
essential to construction
using concrete becomes nolonger necessary. With 3D
data, construction components
in various shapes can be
automatically produced
quickly with high accuracy.
We are aiming to put it into
actual use by fiscal 2025.

Forecast results with AI

Toward Sustainable Growth of the Taisei Group

Goal 11

Build resilient infrastructure, promote
inclusive and sustainableindustrialization and foster innovation

Special Feature

Goal 9About the Taisei Group

SDGs Goal 9, 11, 13, 17

Production of a large-scale hollow
structural post

Business Section

Case   ❼

Tactile Pressure Transmitting-Type Remote Control System
to Enable Autonomous Action of AI Robot

Liquid weighing operation using a force-tactile transmission type
remote control system equipped with AI

ESG Section

The demand for automation is high due to a labor shortage, but thewidespread use of industrial robots is slow to progress due to their high cost.
Under these circumstances, while we are promoting the development ofindustrial robots, we succeeded in realizing the autonomous action of a robot
arm by linking the AI developed by EXAWIZARDS Inc. and a tactile pressuretransmitting-type remote control system. We will continue the development
aiming for actual implementation at production facilities, which are placed insites such as pharmaceutical and food factories.

Taisei Corporation is a member of AVATAR X, a project which aims toaccelerate the utilization of Avatar technology for space-related business.
The program was initiated by ANA and JAXA and launched in 2018 incooperation with other companies and organizations. By participating inthis program, we are contributing to the development of space-related
businesses and advancing tactile pressure transmitting technologies fortelerobotic systems.

Data Section

Fu t u r e Po te n t i a l*Robotic Avatar technology leverages various cutting-edge technologies such as VR, robotics,
sensors and haptics to enable a distant operator to move in a remote location and touch andinteract with objects as if they were physically present.

TA I SE I A N N UA L R E P O R T 2 0 1 9 38

Business Section

Civil
Engineering
By properly recognizing social issues,
we will try to provide our uniquecorporate value to our customers.
Executive Vice President, Members of the Board;
Chief of Civil Engineering Division; In charge of Safety Administration

Shigeyoshi Tanaka

Overview of Segment

The figures include intersegment
transaction.

●Sales in the Civil Engineering segment remained
nearly at the same level as the previous fiscal
year at ¥468.6 billion. Operating income
decreased 25.8% to ¥53.0 billion due to a drop
in gross profit margin.

Operating income

Sales▶Operating
margin¥468.6 billion ¥53.0 billion 11.3%(Up 0.5% YoY)

(Down 25.8% YoY)Net Sales Composition

Sales / Operating margin■Sales (Billions of Yen) ●Operating margin (%)

27.0%

449.4
12.3

2016

466.4
15.3

2017

468.6
11.3

2018 (FY)

Industry-leading technical capabilities● 
Robust worksite capabilities accumulated indifficult projects●

Advantages

Medium- tolong-term
strategies

It is essential to create a business foundation to resolve social issues such as
the frequent occurrence of unimaginably serious disasters, changes in energy
policy, obsolescence of infrastructure and labor shortage. Therefore, we will
accelerate activities including work style reform, productivity improvement,
reinforcement of technical and construction capabilities, reconstruction of theoverseas civil engineering business and challenges in new domains.
As measures for productivity improvement, we will promote the utilization of
T-CIM*1 and ICT (information and communications technology) tools andoutsourcing, and focus on the development of labor-saving and unattended
construction technology.

*1 It is our proprietary CIM (Construction
Information Modeling) System thatmanages and shares construction-related
information. The company is currently
promoting the introduction to engineering
construction sites.

For the reconstruction of the overseas civil engineering business, we willthoroughly manage the projects under construction to avoid mistakes andlosses. In addition, by actively establishing an alliance with foreign companies,
we will secure construction capabilities to compensate for our insufficientcapabilities and expand the business scale.

*2 It means that a public entity such as thegovernment sells the management right ofan airport, water business, etc. to privatecompanies while keeping the ownership.

We will actively tackle areas including Public Private Partnership (PPP) projects
for the renovation of airports, harbors, water and sewage facilities, etc. andconcession*2 business. As for the energy and the environment domains, we will
push forward with activities in new areas such as renewable energy and CCS*3.

*3 An abbreviation of Carbon dioxide
Capture and Storage. It is technology tocapture and store carbon dioxide.

Based on these strategies, we will try to provide our unique corporate value
to our customers.

39 TA I S E I A NNUA L R EPORT 2019

Project in which Various Civil Engineering Technologies Are
Gathered and Adopted
Tokyo Outer Ring Road — Oizumi South Section of the Main Tunnel (North Bound)●Toward Sustainable Growth of the Taisei Group

Overview of construction project
Client/designer: Central Nippon Expressway Company
Limited, Tokyo Branch
Location: Nerima-ku, Tokyo to Musashino-shi, Tokyo

Inside of a shield machine

Photo of Oizumi Junction departure shaft area (the oneon the right-hand side is the north-bound tunnel).

About the Taisei Group

Venue of Value Creation

It is tunnel construction to be excavated by shield machine about 7km of the north-bound tunnel from Oizumi, Nerima-ku to Kichijoji,Musashino-shi. To overcome the issues of complicated ground with alternated strata*4, small soil cover*5, deep-depth and high-waterpressure, we gathered and employed various civil engineer technologies.
Japanese largest shield machine with a diameter of 16.1m is equipped with a tilted-type cutter head and specially reinforced bit. The
tunnel was created by installing concrete pillars along the planned route in the ground, and cutting them directly with the cutter which rotates
at high speed and progresses at slow speed.
The tunnel is expected to ease congestion in the urban area, improve the environment and create a smooth traffic network.

Special Feature

The front side of a shield machine

Disaster Recovery Construction Project for a Large-Scale
Bridge which Adopted Advanced Civil Engineering TechnologiesD isaster Recovery Project of National Route 325 in Kumamoto, Aso Ohashi Bridge Upper andLower Structure Construction

ESG Section●

Business Section*4 Strata that consist of alternated layers of different kinds of rocks and soils*5 Thickness of earth, sand and bedrocks from a digging point to the surface of the ground

Conceptional drawing

It is a construction project of the upper and lower structure of Aso Ohashi bridge, which was closed because it fell down in the Kumamoto
earthquakes in April 2016. With the project, a new bridge is constructed about 600m downstream from the point where the original bridge
was existed. It is a 345m-long prestressed concrete rigid frame bridge with three-span continuous girders*6. Both upper and lower
structures are the largest of their kind in Japan.
To meet the requirements that are unique to the Aso area including steep terrain, the preservation of columnar joints*7 of Tateno Gorge,
and cold winter climate, we adopted various advanced civil engineering technologies including a large-scale incline device*8 to conduct
efficient and safe construction work. While people are expecting the bridge’s completion to be a symbol of the recovery, we are aiming toopen the bridge in FY2020.
*6 A bridge whose main girders and bridge piers are combined.
*7 Column-shaped cracks in stones*8 A device to move a wagon to transport a vessel and cargo by installing rails on slopes

Data Section

Construction status of the bridge piers on the left bank

Overview of construction project
Client/designer: Ministry of Land, Infrastructure,
Transport and Tourism, Kyushu
Regional Development Bureau
Location: Minami-Asomura area in Kumamoto

TA I SE I A N N UA L R E P O R T 2 0 1 9 40

Business Section

Building
Construction
By satisfying customers’ needs andexpectations with our collective strength,
we keep creating value for the future.
Managing Executive Officer, Members of the Board;
Chief of Architecture & Engineering Division (Integrated);
Chief of Building Construction Division

Yoshiro Aikawa

Overview of Segment

The figures include intersegment
transaction.

●Sales in the Building Construction segment
increased 6.6% year on year, to ¥1,130.4
billion reflecting higher sales in the Company
and its consolidated subsidiaries. Operating
income fell 9.0% to ¥87.6 billion due to a drop
in gross profit margin.

Operating income

Sales▶Operating
margin¥1,130.4 billion ¥87.6 billion 7.8%

(Up 6.6% YoY)Net Sales Composition(Down 9.0% YoY)

Sales / Operating margin■Sales (Billions of Yen) ●Operating margin (%)

65.2%

977.7

7.5
2016

1,060.5 1,130.4

9.0

7.8

2017

2018 (FY)

Advantages

Robust worksite capabilities that lead tocustomer satisfaction● C ollective strength that is created by ourmembers who are engaged in sales, design andconstruction

Medium- tolong-term
strategies

Understanding customers’ expectations and needs, we provide environmentfriendly buildings that realize a low-carbon society and structures that are
resilient to natural disasters including earthquakes and typhoons. We arereinforcing our ability related to proposals, designs, organizations, sales andtechnologies for the entire value chain of the Taisei Group including sales,
design, procurement, construction and renewal work.

●

Through the flexible allocation of our employees, which is adjusted depending
on order volume, we are trying to secure a stable construction system. In
addition, we are accelerating the measures that we have been working on
including the promotion of work style reform such as the improvement of
productivity of design and construction with ICT and the introduction of newtechnologies. During FY2018, we established the Digital Product Center toimprove the productivity of construction processes from design to construction
and reduce the workload of worksite offices.

*It is a new social system to comprehensively
manage local energy demand and supply to
optimize energy usage, and provide other life
support services such as the monitoring of
aged people through an energy management
system. It uses renewable energy andtechnologies such as the IoT and storage
battery control.

41 TA I S E I A NNUA L R EPORT 2019

Projecting the medium- and long-term business environment after 2020, weare working on the addition of high value and the enhancement of revenue
opportunities to realize sustainable growth with labor-saving technologies thatutilize the IoT, AI, etc. by strengthening competitiveness to receive orders forthe energy management business in ZEB/smart community* areas.
By satisfying customers’ needs and expectations with our collective
strengths, we keep creating value for the future.

Venue of Value Creation©Aihara Masaaki

Photo courtesy: ©JSC (As of July 2019)

Overview of construction project
Client: JAPAN SPORT COUNCIL
Contractor: Taisei Corporation, Azusa Sekkei Co., Ltd., andKengo Kuma and Associates Joint Venture
Place: Shinjuku-ku, Shibuya-ku, Tokyo

Looking ahead to the next 100 years, the New National Stadium will open to the public in harmony with the surrounding Jingu no Mori neighborhood.
Drawing on our accumulated technologies and know-how, we are currently constructing a solid stadium that will last for many years
through use of highly durable, long lasting, easy-to-maintain materials and natural energy sources, and by limiting the scope of the stadium's
use according to the scale of the events held. Construction is expected to be completed by the end of November 2019.
The Stadium is designed with overhanging eaves, which are one of the features of traditional Japanese buildings adapted to the Japaneseclimate. The eaves, made of forest-certified lumber sourced from all of Japan’s 47 prefectures, are aligned with the orientation of each prefecture.
Our sustainability initiatives are also attracting attention.
The National Stadium as a “holy place” for sports in Japan had witnessed many memorable competitions. Inheriting this history, the New
National Stadium is being reborn as a Japanese-style stadium, transmitting the excitement that athletes and spectators create together to the world.
*After completion, the stadium will be named “National Stadium.”

Creation of a Place of Hospitality Which Japan Can Be Proudof in the World

Special Feature

Photo courtesy: ©JSC (As of July 1, 2019)

Business Section

New National Stadium Development Project*●Toward Sustainable Growth of the Taisei Group

About the Taisei Group

Stadium in Forest That Will Last a Hundred Years

Hotel Okura Tokyo Main Building Reconstruction Project / (Tentative Name) Toranomon 2-10 Project

Hotel Okura Tokyo was established in 1962 by Kishichiro
Okura, the eldest son of Kihachiro Okura, the founder of Taisei
Corporation, and the second leader of Okura Zaibatsu. Inheriting
the legacy that has been loved by VIPs and important guests
from all over the world since its establishment, a complex of
two buildings to house one of the best quality hotels in the world
and offices, which represent an international city, Tokyo, will
open in September 2019.

Data Section

Overview of construction project
Client: Hotel Okura Co., Ltd.
Designer: (Tentative Name) Toranomon 2-10 Planning Design JV(Taisei Corporation – Taniguchi and ASSOCIATES –KANKO KIKAKU SEKKEISHA – NIHON SEKKEI, INC. –P.T. Morimura & Associates, LTD. – NTT FACILITIES, INC. JV)Supervision: Mitsubishi Jisho Sekkei Inc.
Location: Minato-ku, Tokyo

ESG Section●©COPYRIGHT 2017 TANIGUCHI and ASSOCIATES ALL RIGHTS RESERVEDTA I SE I A N N UA L R E P O R T 2 0 1 9 42

Business Section

Real Estate
Development
By resolving various social issues,
we continue to provide new value
based on local culture.
Senior Managing Executive Officer;
Chief of Urban Development Division

Katsuyuki Kanai

Overview of Segment

The figures include intersegment
transaction.

●Sales in the Real Estate Development segmentrose 1.7% year on year, to ¥121.8 billion.
Operating income remained nearly at the samelevel as the previous fiscal year at ¥12.9 billion.

Sales

Operating income▶Operating
margin¥121.8 billion ¥12.9 billion 10.6%(Up 1.7% YoY)
開発事業

Net Sales Composition

7.0%(Down 0.4% YoY)

Sales / Operating margin■Sales (Billions of Yen) ●Operating margin (%)

121.7

119.8

121.8

10.9

10.7

10.6

2016

2017

2018 (FY)

Proposal capability that helps to improve thevalue of the local community● A bility to present solutions based on abundant
experience and know-how●

Advantages

Medium- tolong-term
strategies* It is to enhance/reinforce an aviation
network and local revitalization by
integrating the management of basic
facilities such as runways and airport
terminal buildings for efficient operation.

43 TA I S E I A NNUA L R EPORT 2019

While measures to tackle the obsolescence of public buildings and reinforce
the international competitiveness of urban areas have become urgent tasks, inthe area of urban development, Taisei Corporation is expected to resolve social
issues in cooperation with local communities.
We are engaged in the city redevelopment business mainly for the Tokyo areaand local core cities. For large-scale private development projects such as
Hotel Okura Tokyo Main Building Reconstruction Project (p.42) and New
Construction of Toranomon 2–Chome District Project (p.10), we have beenpromoting them as a project operator.
As for a PPP/PFI (Private Finance Initiative) project, one of the methodologies todevelop a public facility, we will strive to secure stable revenue from the facility
operation business focusing on the airport concession* business such as theoperation of Takamatsu Airport.
By utilizing the know-how accumulated through our engagement in many
redevelopment projects, we are implementing a project to rebuild obsolescentapartments with Taisei-Yuraku Real Estate Co., Ltd., a project to reconstructpublic housing and measures to reduce the area covered with wooden buildings
with TAISEI U-LEC CO., LTD. and TAISEI HOUSING CORPORATION. In this way,by keeping close communication among group companies, we are improving
the profitability of the entire group.
In FY2018, we established the Development Business Department (International)
for expansion of the international development business focusing on Southeast
Asian countries where investment demand for new development is booming.
We will keep promoting urban planning strategically, and providing urban
planning solutions and new value based on the local culture by utilizing
abundant know-how and networks.

Sapporo Sosei Square was created in a redevelopment project through a partnership between public and private sectors in an area withmajor sightseeing spots in Sapporo such as Clock Tower near Odori Station, where three subway lines stop (Namboku Line, Tozai Line,
Toho Line). In addition to offices and a broadcasting station, the public complex has a theater with 2,300 seats for performing arts such as
opera and Sapporo Community Plaza, which includes a library. We participated in the Redevelopment Conference in 2009. After being
selected as a specific business agent in 2014, we helped bring the project to completion from project promotion to the construction phase.

Creating a Vibrant Spot in Kyoto and Helping to Improve
Attractiveness and Revitalize
Kyoto Keizai Center

Overview of construction project
Client: Kyoto Keizai Center (Tentative Name) Joint
Venture Group
Designer: Taisei Corporation
Location: Kyoto-shi, Kyoto Prefecture
Construction period: April 2016 to January 2019

Kyoto Keizai Center, a large-scale complex, was built in the center of Kyoto’s Shijokarasuma / Shijomuromachi area. It is a project to create a
new economic base launched by an economic organization as a part of the 100-Year Plan for the Kyoto Economy. We promoted the projectby cooperating with each owner of the segment, and handled the design and construction of a commercial facility (SUINA Muromachi) as
well as its commercialization.
It creates a vibrant spot where many people gather and interact, and helps to improve the attractiveness of and revitalize the entire
Shijokarasuma / Shijomuromachi area.

Data Section

ESG Section●

Toward Sustainable Growth of the Taisei Group

Overview of construction project
Client: Sapporo Sosei Sanku Kita 1 Nishi 1 Urban Redevelopment Association
Designer: Nikken Sekkei Ltd. – Hokkaido Nikken Sekkei Ltd. JV
Location: Sapporo-shi, Hokkaido
Construction period: January 2015 to May 2018

Special Feature

Sapporo Sosei Square●

Business Section

New Cultural Exchange Base Was Created in the Centerof Sapporo

About the Taisei Group

Venue of Value Creation

TA I SE I A N N UA L R E P O R T 2 0 1 9 44

ESG Section

Toward the Realization of a Sustainable Society
Taisei Group
Philosophy

Taisei Group Philosophy

Taisei Spirit

To Create a Vibrant Environment
for All Members of Society

Active and Transparent Culture/
Value Creation /Evolution of Tradition

Taisei Spirit

Objectives to be Pursued
by the Taisei Group(Goals)Overall Principles ofConduct

Key Concepts That All Taisei Group Officers andEmployees Must Adhere to in Order to Pursue
and Realize the Taisei Group Philosophy

Overall Management
Perspective

Action Guidelines for Taisei Personnel and the Taisei Group as a Whole① Cultivating an open corporate culture⑧ Respect for traditions② Securing a pleasant working environment⑨ Promoting partnerships with subcontractors
and suppliers③ Respect for fundamental human rights
and diversity④ Creating a vibrant environment for
all members of society⑩ Promoting environmental conservationand creation⑪ Communication with local communities⑤ Striving to create value⑫ Conduct in the international community⑥ Pursuing customer satisfaction⑬ Appropriate disclosure of information⑦ Ensuring and improving safety and quality⑭ Fulfilling social responsibilities

Medium-term Business Plan
(FY2018 - FY2020)

Individual Policies (Taisei Corporation)● Risk Management Policy● Policy on Intellectual Property● Policy on the Protection of● Declaration of Biodiversity Preservation

Personal Information● Quality Policy● Health and Safety Policy● Environmental Policy● Environmental Targets● Policy on Business Continuity inTimes of Disaster● Information Disclosure Policy● Procurement Policy● Human Rights Policy● Fundamental Corporate Governance Policy● Fundamental Policy toEnhance Operational Compliance Systems● Code of Conduct on the Use of Social Media● IR Policy● Social Contribution Policy» CSR Our Structure of Values and Policies

To pursue the Group ideal “to create a vibrant environment for all members of society,” all officers and employees share the “Taisei
Spirit,” and carry out corporate actions based on the Group Action Guidelines and Individual Policies “Overall Principles of Conduct”
and “Overall Management Perspective” and Medium-term Business Plan. The aim is to create new social value in the course of
these actions through the wishes and expectations of our stakeholders, while being aware of the issues of sustainable society andcontributing towards their resolution.

» System for Promoting CSR

A CSR Committee (5 board members and officers) has been
established in the Taisei Group, with an Executive Vice
President, Representative Director (Chief of Business
Administration Division) as Chairperson of the Committee, andthe CSR Promotion Section of the Corporate Communication
Department as the secretariat.
The Committee periodically deliberates and reports on theGroup's initiatives regarding non-financial aspects, mainly
Environmental, Social, and Governance (ESG).
The CSR Promotion Section provides training andguidance on CSR, and exchanges opinions with the various
departments and Group companies to promote CSR
activities, for application in day-to-day activities. Also,
discussions regarding policies, systems, and mechanisms forpromoting CSR activities are carried out at business
committees such as the Environment Committee.

Diagram of CSR Promotion System
Members of
the Board

President

CSR Committee

Corporate Communication
Department ofCorporate Planing Office
CSR Promotion Section

Compliance Committee
Technology Committee
Central Safety Committee
Environment Committee
Risk Management Committee

Each
Department

Group
Companies

Central Labor Affairs Committee etc.

*1 Composed of the Corporate Planning Office, Safety Administration Division, Building Construction Division, Civil Engineering Division and Procurement Division*2 The organization of the Taisei Corporation's main cooperating companies

45 TA I S E I A NNUA L R EPORT 2019

The CSR
Procurement
Committee*1

The
Soyukai*2

Participation in CSR-related Groups

Council for Better Corporate
Citizenship (CBCC)(Non-profit incorporated association)

Care International Japan(Non-profit incorporated foundation)
Special Feature

Japan NPO Center(Approved Specified Nonprofit
Corporation)

About the Taisei GroupThe Taisei Group implements CSR management by identifying CSR issues extracted from our Overall Management Perspective andOverall Principles of Conduct, as well as the core subjects of ISO26000, the international standard for corporate social responsibility
at organizations.
To define issues and push forward with activities, we respect the main global initiative, and constantly share and confirm issues
and progress.
To view CSR from a global perspective and link it to sustainability-related social issues, we participate in and cooperate with
CSR-related organizations such as Care International Japan (Non-profit incorporated foundation), an international NGO, which
has been conducting humanitarian activities in over 90 countries around the world in accordance with CSR management
frameworks including SDGs and United Nations Global Compact. In this way, we are continuously implementing CSR activities.
As we publicize the activity status and results on Taisei Corporation’s official website, we talk with various stakeholders to improve
corporate value.

Toward Sustainable Growth of the Taisei Group» CSR Management❶ Selection of Relevant Issues●●

Held hearings in the Taisei Group to identify issues based on ISO26000.
Identified 21 factors that have an impact on medium- to long-term corporate value.

Business Section

Materiality Identification Process❷ Reverifying Importance of Issues
Ranked 21 factors in order of importance for stakeholders on ESG survey forms and expert surveys.
Analyzed factors based on medium- to long-term vision of Taisei Corporation and its
management departments.
● Narrowed down 21 factors to eight issues by ESG category.
●●

ESG Section

In FY2017, we reverified our material issues
and KPIs, and identified eight material issues
based on 21 factors selected from theperspective of CSR issues and megatrends
such as SDGs.
We classified eight materialities andreclassified them into KPIs based on thenegative impact and positive impact (seep.14) on corporate activities. The CSR
Committee will continue to periodically review
the status of KPIs and disclose information in
the annual report.

❸ Determination of Material Issues
Confirmed appropriateness of the process through dialogue with experts.
Confirmed that there were no discrepancies with megatrends such as SDGs, United Nations
Global Compact, GRI Standard (sustainability reporting guidelines)● Final approval by the Board after deliberations by the CSR Committee.
●●

Data Section» Materiality

TA I SE I A N N UA L R E P O R T 2 0 1 9 46

ESG Section

Toward the Realization of a Sustainable Society» SDGs Mapping
The relevance between the 17 SDG goals and ESG materiality is mapped as below:

ESG

E

S

UnitedNations
GlobalCompact

Environment

CSR Items（ISO26000)

Eight material issues and KPIs
(Key Performance Indicator)*1

The Environment /Human Rights /Community Involvement
and Development

Realization of a sustainable and environmentallyfriendly society● At construction stage: CO2 emissions per
construction cost (intensity)● At construction stage: Total CO2 emissions● At building operation stage: Design-build
estimated CO2 emissions● Promotion of recycling construction waste:
Final disposal rate
● Implementation of proposals that consider
biodiversity: Number of proposals● Zero environmental accidents (Implementation ofmanagement procedure based on “Operation
Manual for Priority Environmental Issues”)

Labor Practices /Consumer Issues

Ensuring quality and improving technology● Customer satisfaction (Civil Engineering)● Customer satisfaction (Construction)● Productivity (Net sales/number of employees
working at construction sites)

Fair Operating Practices /Consumer Issues

Technical development for realizing asustainable society● Number of patent applications filed● Number of patent rights registered

Fair Operating Practices /Human Rights

Promotion of supply chain management● Average implementation rate of companies where
CSR activity survey was conducted

Human Rights /LabourLabor Practices

G●

Number of fatal accidents

Labor Practices /Human Rights /Consumer Issues

Cultivation of technical staff and securing humanresources● Average overtime hours per month● Construction Career Up System Worksite registration rate
● Number of female engineers●●

Labor Practices /Human Rights

Realization of an attractive working environmentthat is good to work in● Number of female managers● Turnover rate of employees within three yearsof hiring● Rate of taking childcare leave by males●●

Organization Governance /Fair Operating Practices /Human Rights /Consumer Issues

Promotion of compliance● Number of major information security accidents● “Corporate ethics helpline” and “Group helpline”
response rate

*1 See p.108 for the scope and definition of KPIs.

47 T A I S E I A NNUA L R EPORT 2019

Taisei
Corporation

Thorough management of labor safety and sanitary conditions●

Anti-Corruption

Scope ofreportTaiseiGroup

About the Taisei Group

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Data Section

Mapping of the Sustainable Development Goals

Toward Sustainable Growth of the Taisei Group● The mark indicates mainly the concerned SDGs.

TA I SE I A N N UA L R E P O R T 2 0 1 9 48

ESG Section
Environment

Realization of a Sustainable and Environmentally Friendly Society
By improving and applying environmental technology, the Taisei Group is striving to achieve the 2050 Environmental Targets “Sustainable and Environmentally Friendly Society” involving the entire value chain in unity.

Promotion of Environment Management Activities
We established the Environmental Policy to work on the formation of high-quality social capital through our corporate activities having the construction business as the core in harmony with nature under the Taisei Group’s
philosophy, “To create a vibrant environment for all members of society.” Based on this policy, we set up the 2050
Environmental Targets and identify ESG materiality, and clarify our position to help reduce the burden on the
global environment.

PDCA for Environment Management System
Based on ISO
We are operating an environment management system(EMS) based on ISO14001:2015.
By conforming to environment-related laws and regulations, and participating in organizations and initiatives related
to climate change such as CDP* Japan, we identify risks andopportunities among social requirements related to climatechange, etc., internal and external environmental issues andneeds. To achieve the Environmental Targets establishedfrom a long-term viewpoint, we aim to improve the activities
continuously by using the PDCA cycle for EMS. In this way,
we also provide value to our stakeholders, and generatebusiness opportunities.

EMS’s Organizational Frameworks
Environment strategies including the Environmental Policy
and the medium- to long-term targets are deliberated onby the Environment Committee, and reflected in the company-wide EMS activities.
The committee is chaired by the President, and consists of committee members including members of theboard. It holds a meeting four times a year. We also use
the meeting committee structure for group companies toshare the know-how in environment management andimplement measures as the whole group.

Internal / External Issues and Needs of
the Organization

Pr e si de nt

Chief ofEnvironment Division
Company-wide EMSHigh temperature, water shortage,torrential rain, environmental pollution,

loss of natural resources, price hikes of building

materials,worsened labor andliving environment through urbanization,

Environmental Plan /Environmental Policy
based on theGroup’s Philosophy

environmental laws and regulations, tax system,changes in the demand for buildings andinfrastructurelarge-scale disasters,social assessment

Identification of risks and opportunities
Environmental Policy

TAISEI Green Target 2050

Annual Environmental Targets

PDCA of annual activities
Management review
Improvementof activitiesA

EMS Organization (ISO14001)
Environment
Committee

Environment risk and social issues

Stakeholders’needsC
Performance
evaluationPD

EMS implementation
plan of the head
office andbranches
Technology
development
and deployment
Effort related toenvironment protection

Cooperation among supply chain
Cooperation with stakeholders

EMS of each division
EMS of each branch

Other organizations: Central Safety Committee,
Energy-Saving Promotion Committee,
Taisei Group Environment Promotion Council

ISO14001 certification• Scope: The head office and all 13 branch offices (certified rate: 100%)• Certification registered in 1998
* It is a non-profit organization based in the U.K., and it sends questionnaires on environmental strategies and greenhouse gas emissions to major companies in the world, analyzes
and evaluates the replies, and publicizes it for investors.

49 TA I S E I A NNUA L R EPORT 2019

Provision of value to stakeholders
Generation of sustainable business opportunities

Realization of a Sustainable and Environmentally
Friendly SocietyAbout the Taisei GroupAs we can see from the adaptation of the Paris Agreement, which received much attention in the world, andSDGs, international society is accelerating the movement toward achieving a sustainable and environmentallyfriendly society. Based on this trend, in 2018 we identified important ESG issues (materiality) which contribute to
the achievement of SDGs. We also reviewed our medium- to long-term goal, 2050 Environmental Targets (TAISEIGreen Target 2050) based on environmental issues such as climate change, recycling of resources, co-existingwith nature and environment pollution risk. As the entire group, we are striving to accomplish the “Realization of a
Sustainable and Environmentally Friendly Society.”

TAISEI Green Target 2050
Environmental Targets of Taisei Corporation by 2050●

To realize a society with noclimate change risk
CO2 emissions*
Aim for-80%

Recycling Oriented
Society●

To realize a sustainable,
resource recycling society
Aim for final disposal rateof construction waste of0%

Nature Co-ExistingSociety●

To create a society where
people co-exist with nature

Minimizing impact
on natural capital

A Society Where
Safety is Secured●

To realize a society where
safety is secured
Aim to provide value
with zeroenvironmental risk

Special Feature

Low Carbon
Society

Toward Sustainable Growth of the Taisei GroupFor the Realization of a Sustainable and Environmentally Friendly Society

-62%
-55%

* Total CO2 emissions at construction stage and predicted CO2 emissions at operation stage
・All CO2 reduction rates are comparisons with FY1990.

Business Section

2030 Targets
CO2 emissions atconstruction stage
Predicted CO2 emissions
at operation stage

Data Section

Taisei Corporation is promoting company-wide activities to reduce environmental impact, such as by promoting
paperless meetings, adopting LED temporary lights, ensuring energy-saving operation of heavy machinery andvehicles, using hybrid-type heavy machinery, utilizing renewable energy and arranging a green environment thatpays attention to people’s wellness, under the name of TAISEI Sustainable Action.
Through the promotion of TSA, we are reducing greenhouse gases (CO2) by improving the efficiency of energy
usage for the construction phase at all worksite offices and utilizing renewable energy.
Moreover, to have employees and many people involved in construction recognize the importance of reducing
environmental impact, we distribute “The Guideline for the Achievement of Targets,” which presents detailed
examples to demonstrate the relationship between environmental impact reduction and the improvement of
productivity. We also established a new award system to evaluate ideas about environment activities, which canbe used as a model, as well as ambitious challenges. In this way, we aim to achieve Environmental Targets.

ESG Section

Activities to Reduce Environmental Impact, TAISEI Sustainable Action (TSA)

For material flow and the annual Environmental Targets, please refer to the website.
WEB

https://www.taisei.co.jp/english/csr/performance/iso26000/environment/

TA I SE I A N N UA L R E P O R T 2 0 1 9 50

ESG Section
Environment

Realization of a Sustainable and Environmentally Friendly Society

For the Achievement of a Low-Carbon Society (Risks and Opportunities)
There has been an increasing trend of high temperatures, larger typhoons, and the occurrence of disasters due toextreme torrential rain in recent years and they are environmental risk factors that would stop or delay constructionin the construction industry. However, to resolve and cope with these factors with technology and measures, theindustry could generate business opportunities such as by reinforcing infrastructure related to ZEB (Zero Energy
Building), which could mitigate the effect of climate change, and corresponding measures. Taisei Corporation pays
attention to the short- to long-term effect of climate change by referring to the proposals of the Task Force on
Climate-related Financial Disclosures (TCFD) to identify risks and opportunities, and utilize them for various EMS(Environment Management System) activities.

Major Results in FY2018● SBT Certification and Medium and Long-Term Activities

Taisei Corporation’s greenhouse gas reduction target was certified by Science Based Targets (SBT), aninternational initiative. Our CO2 emission reduction target for 2030, which is a benchmark of Environmental
Target 2050, was recognized as having a scientific basis, and contributes to the achievement of the target of
the Paris Agreement to keep the temperature to less than two degrees Celsius above the level before theIndustrial Revolution.
Through the popularization of ZEB and environmentally friendly designs for customers, we have been working on
reducing environmental burden and CO2 at working sites in Japan during construction by establishing CO2
reduction intensity targets (compared with the value of finished work) for the building operation stage (Scope 3)
and construction stage (Scope 1+2). Our 2030 target certified by SBT was reflected in the annual Environmental Targets. To achieve the targets, in addition to implementing TSA (see p.50), we will cooperate with various
stakeholders including supply chain partners and customers to reduce the emission amount.
Taisei Corporation’s SBT:
Reduce Scope 1 + 2 emissions (CO2 at construction stage) by 26% by 2030
Reduce Scope 3 emissions (CO2 at building operation stage) by 25% by 2030
Note: Both are a comparison to those of FY2013. As for FY2019, please refer to the KPIs
below and p.50.

● CO2 Emission Volume by Scope (Non-Consolidated)
10 3t-CO 2

Scope 3 (upstream)

Scope1+2

Scope 3 (downstream)

GHG protocol
standard*

Category 1 to 8
2,400

236

Category 11 to 12
3,400* International standard for the calculation and reporting of greenhouse effect gas (GHG) emissions

See the website for the status of the past fiscal years.
WEB

https://www.taisei.co.jp/english/csr/performance/iso26000/environment/(Key Performance Indicators)(Non-consolidation)

FY2018 targets

FY2018 results

FY2019 targets

At construction stage: CO2 emissions per construction cost (intensity)*1

25%

28.9%

26%

At construction stage: Total CO2 emissions*1

51%

44.7%

51%

At building operation stage: Design-build estimated CO2 emissions*1*2

38%

40.2%

39%

*1 Base years for CO2 emissions targets: FY1990*2 Including dissemination and promotion of ZEB

51 TA I S E I A NNUA L R EPORT 2019

Department responsible for promotion

Environment Division

About the Taisei Group

Adoption of Green Procurement Item

(Construction design phase: non-consolidated)

In 2001, the Taisei Corporation Green Procurement Guideline
Other items 10%
Facilities 60%
was established and put into effect to promote the use of●Greening of roofs,etc.
●LED lightmaterials, equipment and building methods that have small●Automatic faucet
Structural items●Western-style toilet
environmental burden during the design, construction,
12%(water-saving type)●Recycled steel
operation and demolition of structures.
●Automatic cleaningmaterials
Detailsofequipment and
By referring to and reflecting the content of the Green●High-strength
built-in urinal
adopted items
concrete, etc.
Purchase Law (the law concerning the promotion of(water-saving type)●Energy-saving
Construction
procurement of eco-friendly goods and services by the stateelectric toilet seat
items 18%
and other entities), we review the subject items every year. In●Highly efficient●Ceramic tiletransformer, etc.
●Heat insulating and door
FY2018, 94 items were included in the guideline. Company●Recycled vinyl flooring, etc.
wide application of the guideline could achieve not only therecycling of resources but also energy-saving, a reduction of CO2 emissions, resource-saving, non-use of toxic
substances and the preservation of the natural environment. Through CSR procurement, we are also promoting
environmental consideration for procurement when we work with suppliers.
● Recycling of Waste Plastic

Waste plastic such as building and wrapping materials generated in theconstruction process are strictly sorted for specialist waste disposers to recycle
properly. (Large forming material may be melted with a solution to reduce thevolume to be treated. In addition, we are implementing measures to utilize waste
plastic by combining it with waste wood products and creating an artificial
recycled wood product.)

Taisei Corporation supports the Plastic
Smart Campaign by the Ministry of theEnvironment.

● Recycling and Effective Utilization of Resources at Worksites

The emission volume of construction waste varies depending on the scale and type of construction. In general,the bigger the construction is, the larger the amount of waste becomes. However, most of the waste is strictly
sorted and transported by specialists. Then, it is treated by removing dirt which became attached after construction and recycled. The ratio of the final disposal of the emitted waste, such as disposal at the final waste disposal
site, is less than 4%.
(Key Performance Indicators)(Non-consolidation)

Promotion of recycling construction waste: Final disposal rate

FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

3.7%

3.4%

3.4%

Environment Division

ESG Section

Based on Green Procurement Guideline

Data Section● Recycling and Effective Utilization of Resources

Toward Sustainable Growth of the Taisei Group

Major Results in FY2018

Special Feature

Most of the materials used for the construction business are limited natural resources. Japan imports most of the
raw materials. Therefore, when the supply of materials becomes unstable due to a disaster caused by an extreme
climate, it may create a significant risk to business continuity. By promoting green procurement, Taisei Corporation
aims to achieve a recycling society by considering the life cycle of selecting materials from the building design stage
and providing technology that enables buildings to last many years.

Business Section

For the Achievement of a Recycling Society (Risks and Opportunities)

TA I SE I A N N UA L R E P O R T 2 0 1 9 52

ESG Section
Environment

Realization of a Sustainable and Environmentally Friendly Society

For the Achievement of a Society That Co-Exists with Nature (Risks and Opportunities)
There is always a concern that construction would significantly affect the surrounding environment including nature.
During the planning phase, we extract risks such as the violation of environmental laws and regulations as well as
opportunities including chances to add value. We pay attention to biodiversity until the operation and management
support phase after construction, and provide solutions to create a rich environment to customers. We willcontribute to the achievement of a society that cohabits with nature by properly evaluating the value of natural
resources to utilize for the development of infrastructure and buildings and reducing the influence of construction.

Major Results in FY2018● Biodiversity-Conscious Research, Planning, Construction and Monitoring

With Ecological Planning, our proprietary environment planning technology, Taisei Corporation contributes to therealization of a society that co-exists with nature by analyzing the natural environment of construction sites andsurroundings, carrying out planning based on predictive estimates and monitoring the construction and postconstruction status. In addition, based on our long years of experience, we developed “Ikimono Concierge,” a toolthat conducts a predictive estimation of animals that could be introduced to a planned site and “Mori Concierge,” atool to select plants suitable for the environment of a planned site. Using these tools, we provide high-quality
proposals that contribute to cohabitation with nature.
● Consideration of Biodiversity for Proposal

During civil engineering construction, there are many chances to face the naturalenvironment. Therefore, we propose measures to protect endangered animals
and plants and avoid having an influence on them considering biodiversity. As forconstruction, our biodiversity evaluation tools such as Ikimono Concierge andMori Concierge are effectively used for greening plans at construction sites or for
redevelopment projects.
IKIMONO-Concierge● Implementation of Activities to Contribute to Environment and Society in Cooperation

with Various Stakeholders

The direction of the measures for biodiversity is presented with the Environmental Policy and Declaration of
Biodiversity Preservation. We are proceeding with company-wide activities to reduce environmental impact byutilizing our own Biodiversity Guideline. Not only for business-related
considerations for biodiversity but also as nature and environmental education
program for employees and their families including those of group companies,
we have been conducting volunteer activities to create nest boxes for dormice
and Tokyo Greenship Action, which is nature conservation program hosted by
Tokyo in cooperation with the Animal Pathway Research Society and Animalpathway & Wildlife Association over 10 years. Moreover, since 2011, we havebeen supporting REDD+project to preserve forests in the Philippines andKamaishi Forest Owner’s Association to regenerate forests affected by the
Volunteer activities to make dormouse
Great East Japan Earthquake and forest fire.
nest boxes(Key Performance Indicators)(Non-consolidation)

FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

Implementation of proposals that consider biodiversity: Number of proposals

30 cases

35 cases

30 cases

Safety Administration Division

53 T A IS EI A NNUA L R EP O R T 2 01 9

● Complaint to Worksites and Handling Thereof

We take proper measures regarding environmentrelated complaints addressed to a workplace, make arecord and report using a communication sheet basedon an EMS procedure and share the information
horizontally among concerned departments or within
the entire company as required. In addition, we areproperly handling comments given by citizen groups.

Type

Measure (Example)

Noise

In response to a complaint about the noise generated withmachinery work such as tunnel drilling or that at the temporary yard
for crushed stone, we implemented noise-proof measures andarranged working hours.

Waterpollution

Hydraulic oil was discharged to the drains of a factory. We
eliminated the oil using oil absorption material, and installed polluted
water treatment equipment for the water discharged to the drains.

Vibration

In response to a complaint about the vibration caused by drilling, we
slowed down the speed of heavy machinery.

Dust

In response to a complaint about the dirt that came off fromconstruction vehicles on a public road, we cleaned the road andtires of the construction vehicles.

Topics ● The World’s First 1,4-dioxane Biological Treatment Technology
1,4-dioxane is a chemical substance which is widely used as a solvent in the chemical industry. However, it was revealed
that it has an effect on the human health and biology. Currently, it is a restricted substance of the environment andwastewater standards related to the pollution of groundwater defined by the Ministry of the Environment. However, it does
not dissolve readily. Therefore, chemical treatment such as the accelerated oxidation
treatment method which uses multiple kinds of oxidizer had been employed. However,
the environmental burden and cost of the treatment had been a serious issue. We
searched for 1,4-dioxane-degrading bacterium from various environments, and found a
new bacterium to degrade 1,4-dioxane effectively. We have established a water
treatment process using the degrading bacterium, and completed verification using
polluted groundwater and factory wastewater. The technology is receiving attention fromindustries and academic circles. We received many honorable awards including “The
1,4-dioxane-degrading bacterium
32nd (FY2018) Fuji Sankei Business i. Advanced Technology Award, Special Prize.”(Key Performance Indicators)(Non-consolidation)

FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

Zero environmental accidents (Implementation of management procedure based on “Operation Manual for Priority Environmental Issues” )0 cases

0 cases

0 cases

Environment Division

About the Taisei Group
Toward Sustainable Growth of the Taisei Group

With a worksite environment patrol, the Environment Department of the head office and branches conduct an internal
audit to check the observance of the environment law at worksites. As for the findings, we establish corrective andpreventative measures for continuous improvement. At a worksite, based on the Environment Management manual,
we provide environmental education to our employees and specialized contractors. By sharing the cases that could
result in an environmental accident, issuing notifications of the proper management of toxic substances such as
asbestos and PCB, and reinforcing adequate control and treatment of polluted soil, we have been raising awareness of
the importance of environment management and the prevention of environment-related accidents. In FY2018, there
were no environmental accidents or violations of environmental laws and regulations.

Special Feature● Risk Measures at Worksites

Business Section

Major Results in FY2018

ESG Section

Environment pollution caused by construction has a significant impact on the surroundings and society. Compliancewith environmental laws and regulations is always one of the most important environmental issues. We keep contributing to the reduction of environmental risks of society by promoting the proper management of constructionwaste, the development of new technologies and measures to cope with the regulations for soil pollution which are
expected to become stricter than now.

Data Section

For the Achievement of a Society Where Safety is Secured (Risks and Opportunities)

TA I SE I A N N UA L R E P O R T 2 0 1 9 54

ESG Section
SocialEnsuring Quality and Improving Technology
While we keep providing high-quality construction products and related services efficiently, we promotetechnologies by research and development that satisfy advanced social needs.
Major Results in FY2018● Customer Satisfaction Survey

Based on the Quality Policy, we established and operate a quality management system based on ISO9001, andprovide safe construction products and after-sales services that make customers feel comfortable. After the delivery,
we conduct a customer satisfaction survey. In addition, we have been implementing “TAISEI QUALITY” activities
since 2009 in conjunction with the quality management system to ensure thorough awareness of the quality management standards and procedures within the entire Group.
The results of the customer satisfaction survey of FY2018 showed a satisfaction rate of 96% (last fiscal year95%) and 92% (last fiscal year 90%) for the Civil Engineering Division and the Building Construction Division, respectively. Both rates are on a rather upward trend compared with last fiscal year. We will keep sharing research results,
and eliminate complaints through cooperation between the head office and branches.
● Leveraging ICT Strengths to Realize Immediately Effective Productivity Improvements

Since FY2017, Taisei Corporation has been pursuing an initiative aimed at productivity improvement and technological innovation based on ICT, under the name “Taisei i-innovation®”(see p.37). We are striving to implement thisinitiative company-wide, with approximately 80 employees responsible for its promotion assigned to the head officeand branches. At construction sites, we are working to make maximum use of our ICT strengths as the most immediately effective measure for improving production capacity. We have also developed and established an Internetbased platform, which we have expanded in line with ICT progress and social demands. It is now one of ourstrengths that an operational style using ICT has been well established at all construction sites.
Specifically, we have steadily introduced programs including Worksite Net, an information-sharing network thatcan be used by both in-house and external parties involved in projects focused on worksite offices, and Field Pad®,
an app linked to Worksite Net that allows construction management information to be browsed and recorded evenwhen the user is not in the office.
By continually implementing these kinds of measures, we have been improving productivity. We recorded a productivity score of 111* (last fiscal year 107) (Net sales/number of employees working at construction sites) in FY2018.

Named “TAISEI i-Innovation®” andBeing Promoted in Japan

Electronic field book application
Field Pad®

ICT Seminar

Not only at domestic and overseas construction sites, it has also beenpromoted for all tasks in the back office to support construction sites,
technology research and development divisions and administration
divisions in Japan.

It is used for construction management tasks such as saving
construction record photos and reporting at construction sites.
It reduces working hours and improves productivity.

(Key Performance Indicators)
FY2018 targets

FY2018 results

FY2019 targets

Customer satisfaction (Civil Engineering)

100%

96%

100%

Customer satisfaction (Building Construction)

100%

92%

100%

Productivity (Net sales/number of employees working at construction sites)

110

111

110*

(Non-consolidation)* The actual result for FY2016 is set at 100. 110 is the target for the end of FY2020.

55 TA I S E I A NNUA L R EPORT 2019

Department responsible for promotion

Civil Engineering Division
Building Construction Division

Technical Development for Realizing a Sustainable Society
To create an environment where people and nature live together, and rich culture is nurtured, by fully utilizing
accumulated research results and know-how, we conduct new technology development.
Major Results in FY2018

About the Taisei Group

SocialRegarding the technologies to resolve social issues, staff members at the Technology Center visit each worksite
office every year to look for technologies which we could potentially obtain a patent for, and acquire the rights forsuch technologies. In FY2018, we obtained patents for an energy-saving daylighting device and unit-type lighting
device that has air-conditioning and illumination cooling functions.
We will keep working on the development of technologies to resolve social issues, and retain strategic intellectual property rights in a wide range of fields.

(Key Performance Indicators)
FY2019 targets

Number of patent rights registered

180 cases

250 cases

180 cases

Number of patent applications filed

230 cases

213 cases

230 cases

Department responsible for promotion

Taisei Technology Center

Topics ● Taisei Corporation’s Social Contribution Activities: Support for Researchers“The Taisei Foundation” (General Incorporated Foundation)
We established The Taisei Foundation (general incorporated foundation) in March 2017. To support researchers
who realize the Group’s philosophy, “To create a vibrant environment for all members of society,” we provide
funds for academic research in fields including construction, civil engineering, development, energy, the environment, and disaster prevention. This is to support technology development for the next generation and improve
construction technologies in Japan, and contribute to the progress of academic research.
The foundation publicly invites researchers who wish to be subsidized once every year. From FY2017 to
2019, we had 217 applications as the three-year total. We selected 36 projects to grant subsidies to, andprovided about ¥97 million as subsidies. This fall, the results of 13 research projects which received FY2017
subsidies will be presented. It will be open to the public, and the research results will be widely publicized.

ESG Section

FY2018 results

Data Section

FY2018 targets(Non-consolidation)

Special Feature● Patent Ownership Status

Business Section

For stable and successive growth, we are promoting technology
Research and development expenses (Consolidated)development focusing on renewal, replacement, nuclear power,
FY2016FY2017FY2018the environment, engineering and urban development areas.
¥11.1 billion¥11.6 billion¥12.4 billion
To cope with the advancement and diversification of technicalneeds and improve the return on investment on technology
development, we actively promoted research and development projects by conducting open innovation activities
through an alliance with external parties including universities, companies of the same and different industries, etc.
As for intellectual property such as inventions created through research and development and brands, we
proactively obtain rights and utilize them based on intellectual property strategies. In 2017, we were ranked 18th
(89.5%) in the patent granted rate versus the number of applications (Tokkyo Gyosei Nenji Hokokusho [Annual
Report for Patent Administration] 2018). We would like to contribute to society by developing new technology,
offering technical support at construction sites and utilizing intellectual property based on a combination of business, research and development, and intellectual property strategies.

Toward Sustainable Growth of the Taisei Group● Results of Research and Development Activities

TA I SE I A N N UA L R E P O R T 2 0 1 9 56

ESG Section
SocialPromotion of Supply Chain Management
To exercise CSR as an entire supply chain, we promote CSR procurement activities in cooperation with
our suppliers by gaining the understanding and cooperation of our business partners regarding our Procurement Policy.
Major Results in FY2018● Promotion of CSR procurement

To improvement suppliers’ awareness of CSR procurement, we are conducting the following measures:❶ Implementation of CSR Activity Survey

Procurement Guideline(Summary)

We summarized the matters that we want our business partners to know andobserve as the “Procurement Guideline” (established in 2014), and request
them to conduct CSR activities based on the guideline.
As we implemented in FY2016, in FY2018, we conducted a questionnaire
survey to check the status of our business partners’ CSR activities. We
expanded the survey target from about 500 members of Soyukai, an organization for core subcontractors, to about 1,000 business partners with whom
we consistently deal, and improve the awareness of a wider range of business partners.
Moreover, we are reinforcing the CSR activities of the entire supply chain.
For example, we visited about 20 companies to exchange opinions with thepresident. We also requested them to improve their CSR activity implementation ratio, and raise awareness of their business partners through guidance.

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.

Compliance with laws, regulations
and public morals
Impartial and fair transactions
Respect for human rights
Promotion of safety and hygiene
Environment protection activities
Assurance and improvement ofsafety and quality
Information disclosure
Reinforcement of information
securitySocial contribution activities
Business continuity at the time ofa disaster
Promotion of CSR procurement❷ Survey on the Foreign Technical Intern Acceptance Status
To cope with the recent increase of foreign technical interns, we conducted a questionnaire and interview to confirm
the labor environment and management system of foreign technical interns hired by our business partners. While we
received replies from about 150 companies, we did not find any cases where a violation of laws and regulations issuspected and any cases of an insufficient management system.
❸ Human Rights Traceability*1 Survey to Material Suppliers
For 43 major material suppliers that handle raw materials which are associated with environmental burden or are
sourced in developing countries, we conducted a questionnaire survey to understand their supply chain and check if
the overseas companies of their supply chain are abusing human rights through forced or child labor, infringing therights of indigenous people or conducting illegal acts.
With the survey, we confirmed the status of almost the entire supply chain from original raw material suppliers toworksites for raw materials such as wood, stone and iron, and found no foreign companies of their supply chain
engaged in the violation of human rights and illegal activities.
❹ CSR Procurement Seminar for Overseas Subsidiaries
We conducted a CSR procurement seminar and interview for employees andlocal specialized contractors at our overseas subsidiary in Vietnam, Vinata
International, and 13 people from 11 specialized contractors including business owners attended.
❺ Explanation of CSR Procurement by Chief of Branch
Each Chief of all 13 branches in Japan took opportunities such as the Safety
Conference, explained the importance of CSR procurement to business partners and asked for their corporation in the promotion of activities.

Overseas CSR Procurement Seminar(Hanoi, Vietnam)(Key Performance Indicators)(Non-consolidation)

FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

Implementation rate of companies where CSR activity survey was conducted

70%

74.2%

—*2

Corporate Communication Department(CSR Promotion Section)*1 To make a production history and distribution channel traceable*2 No questionnaire survey for subcontractors will be conducted in FY2019 (biennial implementation)

57 TA I S E I A NNUA L R EPORT 2019

By setting out “Safety First” and reinforcing labor safety and sanitation management, as the entire company,
we are trying to arrange and improve a safe and sanitary environment that allows people to work at ease.
Major Results in FY2018
Construction sites

Branch Health and Safety
Management Plan

Construction Healthand Safety Plan
Construction Site
Manager’sManagement Policy

President’s Health and
Safety Policy
Central Safety Committee

Branch Safety Committee· Targets· Action priorities· Management
priorities, other· Branch targets· Action priorities· Head office plan

· Branch action plan

(Guidance)(Guidance)

Implementation and operation

Implementation and operation

Accident
analysisPrevention ofreoccurrence(Warning)

Accident
analysisPrevention ofreoccurrence· Health and Safety
Management Policy· Health and Safety
Management Plan
· Emergency Response Plan
· Basic Construction
Work Plan

Implementation and operation(Warning)

Accident
response

Internal audits / guidanceConstruction site patrols

On-site inspections / remediation

Records / storage

Records / storage

Records / storage

System review

Special Feature

The safety record of the company in 2018 was 52
accidents that require time off from work, of which 40
were accidents entailing four or more days off workand two fatal accidents. The frequency rate was 0.42.
In 2019, we have again set the targets as follows:
・“Zero fatal accidents” (Shift from recurrenceprevention safety management to preventative
safety management)
・“Zero serious accidents” (Prevention of accidents
with significant social impact, fire, etc.)
We will promote various measures to achieve the targets.

Branches

Health and
Safety Management policy

Labor accident occurrence ratio
2016

2017

2018

Ratio of construction
companies

1.61

1.65

1.66

Ratio of the Company(non-consolidated)

0.47

0.41

0.42

Business Section● Improvement of Safety and Sanitation Level

Head officeAccident
information
database

Accident investigation andanalytical information

Based on the labor safety and sanitation management
system, “TAISEI OHSMS,” we properly implement andoperate the PDCA (plan–do–check–adjust) cycle toconduct risk assessment and take necessary measures based on it. To continuously improve the safety
and sanitation level, we make sure we reduce risks at
workplaces, and provide safety education to theconcerned people at construction sites.
In 2018, to keep reinforcing safety and sanitation
management based on TAISEI OHSMS, we conducted
construction site patrols and provided safety education
to workers.

Specific causes of danger and harmand specific items to be addressed● TAISEI OHSMS

Toward Sustainable Growth of the Taisei GroupThorough Management of Labor Safety and Sanitary conditions

About the Taisei Group

Social● Support of Safety Education of Specialized

The President’s patrol

Number of fatal accidents

FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

0 projects

2 projects

0 projects

Safety Administration Division

Data Section

The award ceremony for worksites, specialized
contractors, and foremen’s associations that havemade achievements in the field of safety and health.

(Key Performance Indicators)(Non-consolidation)

ESG Section

Contractors (Cooperative Companies)

By working closely with the Taisei Health, Safety andEnvironment Cooperation Association, comprisingcooperative companies in Japan, we make efforts toprevent accidents and disasters. The members of theassociation participate in the Safety Conference held inJanuary and Safety Promotion Conference in June every
year. To prevent accidents and disasters, we utilize abulletin, “Kyoryoku (Corporation)” and a list of disastrous
cases for the education and guidance of safety andsanitation management.

TA I SE I A N N UA L R E P O R T 2 0 1 9 58

ESG Section
SocialCultivation of Techniacal Staff and Securing Human Resources
In an aim to establish a construction business that is attractive for younger generations, Taisei Corporation
focuses on improving its workplaces and working conditions and strives to further strengthen measures tosecure and develop human resources.
Major Results in FY2018● Initiatives to Correct Long Working Hours

Taisei Corporation formulated a roadmap for correcting long working hours that runs up until FY2024 and has set
targets for “health management overtime,” “rest days + time off in lieu” and “closure of work sites” in phases foreach fiscal year (see p.17).
In addition, to promote awareness reforms and behavioral changes by employees, all employees take part indiscussing and implementing specific initiatives according to the circumstances of their respective workplaces.
Activities that have proven to be effective for reducing working hours are implemented across the company andinitiatives are taken to have such activities take root as ongoing activities.
❶ Reduction of Overworked
Employees
100
99

0.3%

0.9%

❷ Increase in the Number of Employees
Taking 8 Days off in 4 Weeks❸ Closure of 60% of Worksites on theSecond Saturday of Each Month100

The worksite
closure rate

90

98
97

80

96

81.7%

95
94

57.3%

91.0%

2017

2018

70
(FY)

■ 80 hours or less ■ Over 100 hours■ More than 80 hours, less than 100 hours

2017

2018

(FY)

❶ Overtime: Employees with overtimeof 100 hours or more a monthdeclined to 0.3% of all employees(0.9% in the previous fiscal year).
❷ Rest days + time off in lieu: The
number of employees who took
104 rest days + time off in lieu
(8 days off in 4 weeks) increased toaccount for 91% of all employees(81.7% in the previous fiscal year).
❸ The worksite closure rate (second
Saturday of each month) came to
57.3%.

■ 8 or more days off in 4 weeks ■ 7 or more days off in 4 weeks■ 6 or more days off in 4 weeks ■ 5 or more days off in 4 weeks● Promotion of Construction Career Up System (CCUS)

In reinforced coordination with cooperating companies, we are promoting the introduction, popularization andpromotion of CCUS, which registers and promotes the transparency of skills, experience and qualifications of eachconstruction worker and the status of enrollment in social insurance programs under uniform rules of the industry.
Under the guidance of the Ministry of Land, Infrastructure, Transport and Tourism, relevant organizations in theconstruction industry, such as the prime contractors’ organization, specialty contractors’ organization, housing
industry association, and construction workers’ association, have been working together and promoting CCUS as
an important infrastructure that leads to securing human resources for the future and improving the working conditions of skilled construction workers. Following a limited operation from January 2019, the system went into fullscale operation in April. Taisei Corporation has been working to popularize this system by expanding the scope of
applicable work sites for registration from the initial plan (as a general rule, work sites with a construction value of¥100 million or more), and the work site registration rate has already significantly exceeded the 60% target set for
the end of September 2019. We will continue to work on enlightening cooperating companies so that progress ismade with the registration of business operators and technicians and promote popularization of CCUS.
● Promotion of Women’s Participation and Advancement

Taisei Corporation expressed support for the “Declaration on Action by A Group of Male Leaders Who Will Create aSociety in which Women Shine” announced by the Gender Equality Bureau Cabinet Office in April 2017 and has
been supporting the empowerment of females. Female technical staff members at Taisei Corporation account for
9.1% of all technical staff, and the number of female technical staff increased from 621 in the previous fiscal year to663. In addition, the number of female employees at our work sites increased from 140 in FY2014 to 188 in
FY2018. We will continue to promote the participation and advancement of females not only at our work sites but
also in all areas of the Company and make efforts to establish career paths attractive for females.
(Key Performance Indicators)(Non-consolidation)

FY2018 targets

FY2018 results

Construction Career Up System Worksite registration rate*

FY2019 targets

Department responsible for promotion

60% or more

Civil Engineering Division
Building Construction Division

Average overtime hours per month

35 hours

37.8 hours

35 hours

Number of female engineers

640 persons

663 persons

690 persons

Human Resources Department* The ratio of total net sales of registered worksites against the total net sales. The target set for September 2019 is 60% or more. The system went into full-scale
operation from April 2019.

59 TA I S E I A NNUA L R EPORT 2019

Realization of an Attractive Working Environment That Is Good to Work in
Taisei Corporation pursues the development of human resources and promotes active participation of workers in an
aim to realize a workplace in which all employees can fully demonstrate their skills and work with enthusiasm bytaking advantage of their diversity in terms of gender, nationality, disability, values, working styles and career.

Major Results in FY2018

About the Taisei Group

Social● Improving Retention Rate of Young Employees
We strive to eliminate the mismatching of employees and jobs through measures such as providing detailed job
descriptions during the recruitment screening process, visiting construction sites and actively receiving interns. We
also work to retain employees by striving to create a pleasant working environment through periodically holding
interviews with young employees after they join the Company and taking other steps.
● Improved Childcare Leave Usage Rate by Male Employees
Since July 2016, we have been targeting a childcare leave usage rate by male employees of 100%. As a result of
implementing various measures, including the sending out a message from the President and enhancing thechildcare leave system, the childcare leave usage rate by applicable male employees reached 94.2% and theaverage number of days taken was 5.8 as of March 31, 2019.

Topics ● Implementation of Virtual Reality Experience-Based Nursing Care Seminar

Special Feature

The number of females that participated in the female leaders training conducted as part of the measures topromote female empowerment was 166 and the number of participants in the diversity management training for
managerial levels was 470. We help employees flexibly select the working style that meets their lifestyles by using
systems such as job return*2, flex working hours, and telework. We also promote the use of a sign language
interpreter, UD Talk (a communication supporting application that makes conversations transparent) and put in placea consultation window, etc. and we currently have approximately 140 employees with disabilities taking active roles.

Toward Sustainable Growth of the Taisei Group● Diversity and Inclusion*1(Key Performance Indicators)(Non-consolidation)

Number of female managers
Turnover rate of employees within three years of hiring*3
Rate of taking childcare leave by males

FY2018 targets

FY2018 results

FY2019 targets

130 persons

167 persons

180 persons

4%

5.4%

4%

100%

94.2%

100%

Department responsible for promotion

Human Resources Department

Business Section

To support employees who have worries about balancing work and nursing care, we hold a virtual reality
experience-based nursing care seminar several times a year in which employees can participate with their family
members. We are also proceeding to enhance our support systems, including nursing care holiday and nursing
care leave.

ESG Section*1 Diversity is the concept of accepting different types of people. Inclusion refers to the concept of making use of different characters.
*2 The system of rehiring former employees based on their wishes.
*3 The turnover rate of new graduates in general and expert positions.

Governance

Promotion of Compliance(Key Performance Indicators)
FY2018 targets

FY2018 results

FY2019 targets

Department responsible for promotion

Number of major information security accidents

0 cases

0 cases

0 cases

Information Planning Department“Corporate ethics helpline” and “Group helping” response rate*4

100%

100%

100%

General Affairs Department*3

Data Section

In an aim to become a company which truly gains the trust of society and which customers feel comfortable doing
business with, Taisei Corporation implements various measures to encourage each and every officer and employee
to demonstrate awareness and autonomy.
(For details, please see pp.71 – 74.)

*3 Number of accidents publicly announced by Taisei Corporation and its eight major Group companies.
*4 The scope of numbers includes Taisei Corporation and its 21 Group companies.

TA I SE I A N N UA L R E P O R T 2 0 1 9 60

ESG Section

Corporate Governance» Basic Policy for Corporate Governance and Management Systems
Based on our Group Philosophy of “To Create a Vibrant Environment for All Members of Society (objectives to be pursued by the
Taisei Group; goals),”we emphasize harmony between people and nature and aim to be a company that is trusted by society bycontributing to the formation of social and industrial infrastructure.
In addition, based on the concept of the Taisei Spirit, which is represented by the commitment to “Active and Transparent
Culture,” “Value Creation” and “Evolution of Tradition” and the Group Action Guidelines (being the fundamental principles for actions
and decision-makings upon which the Taisei Group is to conduct itself, and which are to be strictly complied with by all members of
the Taisei Group), we will contribute to society by providing excellent quality and services at a reasonable price in our core construction industry business and by solving various problems of our customers.
The Company’s fundamental approach to corporate governance is to conduct the management and decision-making of thebusiness in a swift, appropriate, fair and transparent manner in order to continue to grow as a corporation in a sustainable andsocially responsible manner.
The aforementioned fundamental view is reflected in the Fundamental Corporate Governance Policy in light of the response toeach of the principles of the Corporate Governance Code. The Fundamental Corporate Governance Policy is available on our official
website indicated below:

Fundamental Corporate Governance Policy
WEB

https://www.taisei.co.jp/english/profile/governance/

Main History of Corporate Governance at Taisei Corporation
Strengthening the Board’s management decisions and supervisory function
Introduced a System of
Executive Officers(Number of Membersof the Board: from 49 to 12)

Introduced Independent External
Members of the Board
Number of Members of theBoard: 12(Including 2 External Membersof the Board)

●

1999

●

●

2003

Established
Fundamental
Corporate
Governance Policy

Members of the Board: 12(Including 4 External Members of the Board)
Audit & Supervisory Board Members: 6(Including 4 External Audit & Supervisory Board Members)

2015

2019

» Corporate Governance System
Chart of Corporate Governance System❶ Shareholders / General Meeting of Shareholders
Appointment/Dismissal❽ Accounting Auditor

Appointment/Dismissal❺ Audit & Supervisory
Board Members/
Audit & Supervisory Board

Cooperation
Audit

Audit

6 Audit & Supervisory Board Members(including 4 External Audit &Supervisory Board Members)

Cooperation
Cooperation
Audit❷ Members of the Board/
Board
12 Member of the Board(including 4 External
Members of the Board)

Prior
Consultation
and Report

Appointment/Dismissal/
Supervision
Report/❹ Executive Officers
AdvicePresident andChief Executive Officer❻ Audit & Supervisory Board
Members’ Department

Audit

Appointment/Dismissal● Environment Committee

Direction/SupervisionInternal Audit
Group Companies

Support/Guidance/
Cooperation

61 TA I S E I A NNUA L R EPORT 2019

❾ Special Committee● Compliance Committee❿ Operations Committee❼ Auditing Department
Internal Audit❸ Committees of the Board● Executive Personal Committee● Remuneration Committee● Finance Committee● CSR Committee, etc.

Operating Divisions● Risk Management

Committee, etc.

❷ Members of the Board / Board (convened 13 times in FY2018)
The Board, entrusted by the shareholders, shall pursue activities for the common benefit of the Company and its shareholders, andshall be responsible for maintaining an efficient and effective corporate governance structure to facilitate the growth of theCompany in a sustainable manner and improve its corporate value in the mid- to long-term.
At least two of the Members of the Board shall be Independent External Members of the Board in order to ensure that theindependent and objective oversight of the execution of the Board’s operations may be effectively carried out, and the Board iscomposed of 12 Members of the Board (eight Internal Members of the Board and four External Members of the Board).
The External Members of the Board (three males and one female), who have objective viewpoints based on their experienceand insight, bring diversity to the deliberations of the Board while contributing to strengthening supervision of management.

❸ Committees of the Board
For the purpose of invigorating and substantializing deliberations by the Board, the Company has established the following
committees within the Board as organs for prior consultation of important matters: 1) the Executive Personnel Committee
responsible for deliberating on the personnel-matters of the Members of the Board, Executive Officers, etc.; 2) the Remuneration
Committee responsible for deliberating on the remuneration of Members of the Board and Executive Officers; 3) the FinanceCommittee responsible for deliberating on the potential acquisition and holding of significant assets; 4) the Affiliates Committee
responsible for deliberating on important matters associated with Group companies; and 5) the CSR Committee responsible fordeliberating on matters to enhance the entire Group’s CSR-based business management (see p.45).

Composition of the Executive Personnel Committee / Remuneration Committee
Name
Chairperson
Composition(including the Chairperson)
Number of meetings convened in FY2018

Executive Personnel Committee
External Members of the Board
4 Internal Members of the Board
4 External Members of the Board
11 times

Remuneration Committee
External Members of the Board
4 Internal Members of the Board
4 External Members of the Board
2 times

About the Taisei Group
Toward Sustainable Growth of the Taisei GroupThe Company shall endeavor to dispatch the convocation notice of its General Meeting of Shareholders at least three weeks prior
to the scheduled date of such General Meeting of Shareholders in order to provide its shareholders time to sufficiently consider theagenda of such General Meeting of Shareholders and exercise their voting rights appropriately. In addition, prior to dispatchingeach notice, the Company shall announce electronically the information relevant to such General Meeting of Shareholders throughthe TDnet system and its official website.

Special Feature❶ Shareholders / General Meeting of Shareholders (held on June 26, 2019)❹ Executive Officers❺ Audit & Supervisory Board (convened 14 times in FY2018)
As an entity independent of the Board and the Operating Divisions, and in accordance with the Audit Policy established by the
Audit & Supervisory Board, the Audit & Supervisory Board Members audit the performance of the Member of the Board including
attending the meetings of the Board and hearing of reports on business conditions from the Members of the Board.
The Audit & Supervisory Board Members and the Chief Executive Officer, the Auditing Department and the Accounting
Auditors hold regular meetings to arrive at mutual understanding and to improve the effectiveness of the audits.

Business Section

For the purpose of separating the important management decision-making and oversight functions and the business executionfunction and enabling agile business execution, Taisei Corporation adopts the executive officer system.

❻ Audit & Supervisory Board Members’ Department❼ Auditing Department
Based on the annual auditing plan, the Auditing Department also conducts internal audits of administrative and management systems,
as well as the legality and rationality of the management of corporate affairs at all in-house departments and Group companies.

ESG Section

In order to assist the Audit & Supervisory Board Members in the performance of their duties, the Audit & Supervisory Board
Members’ Department has been set up independently of the Board as a dedicated organization to support the Audit & Supervisory
Board Members with the collection of appropriate information and other tasks.

❽ Accounting Auditor❾ Special Committee
We have set up the Compliance Committee chaired by an external expert as a Special Committee to respond to consultations with
the President and we endeavor to reinforce the promotion of compliance (see p.72).

Data Section

The Accounting Auditors submit reports on the audit plan and the audit results to the Audit & Supervisory Board, the Accounting
Department and other internal control departments as needed.
To ensure the external accounting auditors conduct fair and appropriate audits, the management of the Company, Audit &Supervisory Board Members and the Auditing Department shall have meetings on a regular and as-needed basis, and exchange
their opinions with the external accounting auditors. Further, the Board shall respond appropriately if external accounting auditors
detect dishonest practices and request that appropriate action be taken, or indicate errors or problems.

❿ Operations Committee
We have set up a range of operations committees including the Technology Committee, the Central Safety Committee, the Environment Committee (see p.49), the Risk Management Committee (see p.63), and the Central Labor Affairs Committee to deliberatematters that involve consultations with the President.
TA I SE I A N N UA L R E P O R T 2 0 1 9 62

ESG Section

Corporate GovernanceCorporate Governance» Effectiveness of the BoardAt Taisei Corporation, we analyze and evaluate the effectiveness of the Board on the whole once every year. In FY2018, the Membersof the Board and Audit & Supervisory Board Members conducted a self-evaluation for the evaluation items which had beenreviewed and revised, followed by deliberations by the Board with reference to an overall evaluation by the External Members of theBoard and a third-party opinion from a lawyer.
The results of the evaluation indicate that the Board of the Company is properly operated and is functioning effectively overall,that the Board’s diverse composition is a contributing factor and the Internal Members of the Board are sincerely accepting active
comments and advice from the External Members of the Board, etc.
From the perspective of continuing to improve the activities and the effectiveness of the Board of the Company, recommendations that the Board should further devise a timeframe for explaining and deliberating the agenda items to allow even fuller discussions of important matters, that points of discussions organized by the various committees should be reported to the Board in amore concise manner, and that greater efforts should be made to identify and evaluate in a timely manner changes in the
management environment and the status of progress of the management plan were among other opinions noted. In addition, in
response to the FY2017 evaluation, the Company made efforts to invigorate operations of the Board in FY2018 through measures
such as partially revising the standards for addressing matters to the Board and holding free debates and exchange of opinion
sessions on medium- to long-term themes of the Company.
The Company aims to further enhance the operation of the Board based on the results of the FY2018 evaluation.

» Promotion of Internal Controls

At Taisei Corporation, the Board has established the “Fundamental Policy to Enhance Operational Compliance Systems” to ensure
the reliability of financial reporting and systems for conducting operations in an appropriate and efficient manner as a Group. Throughthese systems, we deliver enhanced risk management and compliance (see p.70). The Company implemented a range of measures
also in FY2018, such as developing rules concerning compliance.
Fundamental Policy to Enhance Operational Compliance Systems
WEB

https://www.taisei.co.jp/english/profile/governance» Ensuring Credibility of Financial Reporting
Internal controls on financial reporting based on the Financial Instruments and Exchange Act are recognized as one of the mostimportant issues for a corporation. We have set up the internal systems including daily monitoring to ensure the credibility of thefinancial reporting disclosed to the public.
The effectiveness of the system is evaluated by the Audit Department and audited by KPMG AZSA LLC. The results aredisclosed in the Internal Control Report and in the Audit Report of Internal Controls. We will fulfill our social responsibility as acorporation by continuing to ensure the effectiveness of these internal controls.
In order to continue to operate the internal control systems relating to financial reporting in a sound manner, we are also
publishing messages from the President, implementing e-learning, and other campaigns to raise awareness among officers
and employees.

» Support System for External Members of the Board and External Audit & Supervisory
Board Members

The Secretarial Department is responsible for assisting operations of External Members of the Board, and the Audit & Supervisory
Board Members’ Department, which is independent of Members of the Board, is responsible for assisting operations of External
Audit & Supervisory Board Members.
The responsible officers and employees of the Secretarial Department distribute materials and provide explanations concerning
proposals to External Members of the Board prior to the meetings of the Board held in principle once a month. For External Audit &Supervisory Board Members, the responsible employees of the Audit & Supervisory Board Members’ Department provide
explanations and distribute materials in advance regarding proposals. Information is also provided in a timely manner to External
Members of the Board and External Audit & Supervisory Board Members.

63 T A IS EI A NNUA L R EP O R T 2 01 9

» Accountability
Taisei Corporation established the Information Disclosure Policy in 2006, and has set forth principles for ensuring appropriate
information disclosure and transparency in the Fundamental Corporate Governance Policy. These policies form the basis for ourpractice of timely and appropriate information disclosure. In 2015, the Company established the IR Policy and has been promoting
constructive dialogue through discussions with shareholders and investors, IR briefings, and the annual general meeting ofshareholders.
Furthermore, we strive for fair information disclosure via the Taisei Corporation official website, where we publish explanatory
material with commentary, summaries of the President’s speeches and the main question and answer sessions (in Japanese andEnglish) on top of the Medium-term Business Plan and materials distributed at results briefings. In addition, we disclose information
to overseas investors in English in our annual reports and on the Taisei Corporation official English website.
We also report on key business activities and ESG (Environment, Society, Governance) initiatives in the shareholder newsletter inorder to further deepen our shareholders’ understanding of our corporate activities.

About the Taisei Group
Toward Sustainable Growth of the Taisei GroupThe Company holds necessary training seminars for Members of the Board and Audit & Supervisory Board Members in order forthem to fulfill their functions to supervise and audit its business. Seminars covering related laws and regulations, the Articles ofIncorporation, the Board Regulations, and internal processes for determining important policies of the Company, etc. are provided
when officers assume their positions.
In addition to this training, the Company continuously provides opportunities for Members of the Board and Audit & Supervisory
Board Members to undergo trainings provided by third-party organizations. We also implement measures such as visits to worksites
as needed for External Members of the Board and External Audit & Supervisory Board Members to deepen their understanding of
the Taisei Group and our business.

Special Feature» Implementation of Training for Members of the Board and Audit & Supervisory Board Members❶ Policies and procedures in determining remuneration

Data Section

ESG Section

Remuneration for the Members of the Board is determined from a comprehensive perspective that includes the scale, content, andperformance of our business, as well as individual job specifications and responsibilities. Based on a resolution passed at the 146th
Annual General Meeting of Shareholders on June 27, 2006, the sum total of monthly remuneration for the Members of the Board
shall not exceed ¥70 million. Based on a resolution passed at the 134th Annual General Meeting of Shareholders on June 29, 1994,
the sum total of monthly remuneration for Audit & Supervisory Board Members shall not exceed ¥12 million. Further, where
remuneration for the Members of the Board is concerned, the system of remuneration shall reflect performance and will be
determined by the Board after deliberation by the Remuneration Committee, which carries out preliminary reviews ahead of board
meetings, while remuneration for Audit & Supervisory Board Members shall be determined upon consultation with the Audit &Supervisory Board.

Business Section» Remuneration for Officers

TA I SE I A N N UA L R E P O R T 2 0 1 9 64

ESG Section

Corporate GovernanceCorporate Governance(Performance-Linked Remuneration)
Remuneration for the Members of the Board of the Company consists of the performance-linked remuneration set by position(including the position of Executive Officer when concurrently serving as Executive Officer) and the remuneration, etc. other thanthe performance-linked remuneration, and the amount of remuneration is determined and promoted by position. The indicators
associated with the performance-linked remuneration represent the sum of income before income taxes on the non-consolidated
statement of income of the most recent business year and the total amount of bonuses for employees borne in the most recent
business year and these indicators are selected on the grounds that they are approximate to the added value of the Company.
In determining the amount of the performance-linked remuneration, the Remuneration Committee holds discussions on thefollowing matters and addresses them to the Board.
(1) Total amount of remuneration and others paid to Members of the Board and the amount by position(2) Establishment of and revisions to internal rules concerning remuneration for Members of the Board and others
Targets and results of indicators associated with performance-linked remuneration are as shown below.

（Millions of Yen）

Date of resolution by the Board

June 26, 2019

June 8, 2018 (FYI)

Applicable period of remuneration

July 2019 – June 2020

July 2018 – June 2019

Target or Result

TargetResults

TargetResults

Income before income taxes in the most recent business year

115,000

137,235

109,000

160,958

Total amount of bonuses for employees borne in the mostrecent business year

(Note)

33,738(Note)

28,328

Total(Note)

170,973(Note)

189,287

Note: Since no target value is set for the total amount of bonuses for employees, only the result is indicated.

❷ Total amount of remuneration, etc. by officer category, total amount of remuneration, etc. by type and number
of applicable officers
Internal executives
Category

Number of recipients

Fixed remuneration(Millions of Yen)

Performance-linked
remuneration(Millions of Yen)

Total amount of
remuneration(Millions of Yen)

Members of the Board

8

395

313

708

Audit & Supervisory Board
Members

2

78

—

78

Subtotal

10

473

313

787

Fixed remuneration(Millions of Yen)

Performance-linked
compensation(Millions of Yen)

Total amount of
remuneration(Millions of Yen)

External executives
Category

Number of recipients

Members of the Board

3

46

—

46

Audit & Supervisory Board
Members

4

57

—

57

Subtotal

7

104

—

104

Total amount
Number of recipients

Fixed remuneration(Millions of Yen)

Performance-linked
compensation(Millions of Yen)

Total amount of
remuneration(Millions of Yen)

Members of the Board

11

442

313

755

Audit & Supervisory Board
Members

6

135

—

135

Total

17

578

313

891

Category

Note: All remuneration, etc. paid to Audit & Supervisory Board Members and Members of the Board are basic remuneration.

65 TA I S E I A NNUA L R EPORT 2019

About the Taisei Group❸ Total amount of consolidated remuneration, etc. by officer (only for those whose total consolidated
remuneration, etc. is no less than ¥100 million)

122

70

52

70

52

Chairman,
Representative Director
President,
Representative Director

Major Activities and Attendance of External Members of the Board and External Audit & Supervisory Board Members in FY2018

Name

Toru Tsuji

Fumio Sudo

Atsuko Nishimura

Terunobu Maeda

Shigeru Morichi

Kiwamu Miyakoshi

Kunitoshi Saito

Independent
Director

Major Activities(Significant Concurrent Positions As of June 21,2019)

Attendance at Meetings in FY2019
Number of Meetings Attended/
Total Unmber of Meetings◯

He attended all the board meetings held in the current fiscal year.
Based on the deep insights obtained from his experience as amanager in a different industry and from his neutral position andview as an external member of the board, he offered useful
opinions to the Company’s management in order to establish aninternal control system and strengthen corporate governance and acompliance system.

Attendance at the Board
13 out of 13 Meetings (100%)◯

He attended all the board meetings held in the current fiscal year.
Based on the deep insights obtained from his experience as amanager in a different industry and from his neutral position andview as an external member of the board, he offered useful
opinions to the Company’s management in order to establish aninternal control system and strengthen corporate governance and acompliance system.

Attendance at the Board
13 out of 13 Meetings (100%)◯

Since she assumed the position of an external member of theboard in the 157th General Meeting of Shareholders held on June29, 2017, she attended all the board meetings held during thecurrent fiscal year. Based on her abundant international sense
obtained from her experience as a diplomat and from her neutral
position and view as an external member of the board, she offereduseful opinions to the Company’s management in order to establish
an internal control system and strengthen corporate governanceand a compliance system.
● Outside Director of INPEX CORPORATION

Attendance at the Board
13 out of 13 Meetings (100%)◯

He attended all the board meetings held in the current fiscal year and
13 out of a total of 14 audit & supervisory board meetings held
during the same period. He offered his opinions as and when appropriate based on his broad knowledge of finance and accounting.
● Outside Audit & Supervisory Board Member of the Higo Bank Ltd.

Attendance at the Board
13 out of 13 Meetings (100%)◯

He attended all the board meetings and audit & supervisory board
meetings held in the current fiscal year. He offered his opinions as
and when appropriate based on the deep insights obtained from his
experience as a university professor.
● Director of Policy Research Center of National Graduate Institutefor Policy Studies

Attendance at the Board
13 out of 13 Meetings (100%)◯

He attended all the board meetings and audit & supervisory board
meetings held during the current fiscal year. He offered his opinions
as and when appropriate based on the deep insights obtained fromhis experience as a police officer.
● Director (Audit and Supervisory Committee Member) of
LIXIL VIVA CORPORATION◯

He attended all the board meetings and audit & supervisory board
meetings held during the current fiscal year. He offered his opinions as
and when appropriate based on the deep insights obtained from his
experience at the Board of Audit of Japan.

Toward Sustainable Growth of the Taisei Group

Yoshiyuki Murata

Performance-linked
remuneration

Special Feature

122

Fixed remuneration

Business Section

Takashi Yamauchi

Position

Attendance at the Board
13 out of 13 Meetings (100%)
Attendance at the Audit &Supervisory Board 14 out of 14
Meetings (100%)

ESG Section

Name

Total amount of consolidated remuneration by type(Millions of Yen)

Attendance at the Audit &Supervisory Board 14 out of 14
Meetings (100%)

Attendance at the Audit &Supervisory Board 14 out of 14
Meetings (100%)
Attendance at the Board
13 out of 13 Meetings (100%)

Data Section

Total amount of consolidated
remuneration

Attendance at the Audit &Supervisory Board 14 out of 14
Meetings (100%)TA I SE I A N N UA L R E P O R T 2 0 1 9 66

ESG Section
Corporate GovernanceManagement Members (As of 1 September, 2019)
Members of the Board
Takashi Yamauchi Chairman, Representative Director
1969.06
1999.06
2002.04
2004.06
2005.06
2007.04
2015.04

Shigeyuki Sakurai Representative Director
1979.04
2011.04
2013.04
2013.06
2015.04
2017.04

Norihiko Yaguchi2017.04
2019.04

Yoshiro Aikawa

2001.06
2004.09
2008.06
2012.04
2014.04
2016.072017.06

Norio Otsuka

2004.06
2007.06
2009.06
2015.06
2018.06
2019.06

67 TA I S E I A NNUA L R EPORT 2019

Shigeyoshi Tanaka Representative Director
1979.04
2011.04
2013.04
2015.04
2015.062017.04
2019.04

1979.04
2012.04
2015.04
2019.04
2019.06

Hiroshi Kimura
Joined the Company
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Member of the Board
Chief of Architecture &Engineering Division (Integrated);
Chief of Building Construction Division[Present Position]

Joined the Company
Executive Officer
Managing Executive Officer
Senior Managing Executive Officer
Senior Managing Executive Officer,
Member of the Board
Executive Vice President,
Member of the Board
Executive Vice President,
Representative Director
Chief of Civil Engineering Division;
In charge of Safety Administration[Present Position]

Takao Murakami

Joined NSK Ltd.
Executive Officer
Managing Executive Officer,
Member of the Board
Senior Managing Executive Officer,
Representative Director
Executive Vice President,
Representative Director
President and Chief Executive Officer,
Representative Director
Chairman, Member of the Board
Advisor of NSK Ltd. [Present Position]
Member of the Board of Taisei Corporation[Present Position]

Joined the Company
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Member of the Board
Deputy Chief of Marketing &Sales Division (Integrated);
Supervising Marketing & Sales (Civil
Engineering) Divisions;Chief of Marketing & Sales (Civil Engineering)
Division [Present Position]

External Board Member
1969.04
1999.03
2001.03
2003.072004.032005.03
2011.032018.032019.06

Fumiya Kokubu

Joined the Company
Executive Officer
Managing Executive Officer
Senior Managing Executive Officer
Senior Managing Executive Officer,
Member of the Board
Chief of Marketing & Sales (Building
Construction) Division II[Present Position]

Director
1982.04
2015.04
2018.04
2019.06

Joined Ministry of Foreign Affairs of Japan
Minister/Counsellor of Permanent Mission ofJapan to the United Nations
Minister of Embassy of Japan in Belgium
Professor of Tohoku University Graduate School of Law
Administrative Vice President of the Japan Foundation
Advisor of Japan Oil, Gas and Metals National Corporation
Ambassador Extraordinary andPlenipotentiary to Grand Duchy of Luxembourg
Ambassador Extraordinary and Plenipotentiary for
Women, Human Rights and Humanitarian Affairs
Member of the Board of Taisei Corporation[Present Position]

External Board Member
1973.04
2000.04
2002.06

Joined the Company
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Member of the Board
President and Chief Executive Officer(Representative Director) [Present Position]

Hiroshi Shirakawa Director

Atsuko Nishimura External Board Member
1979.04
1999.08

2015.04

Joined the Company
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Member of the Board
Senior Managing Executive Officer,
Member of the Board
Senior Managing Executive Officer,
Member of the Board
Deputy Chief of Marketing &Sales Division (Integrated);
Supervising Marketing & Sales (Building
Construction) Divisions [Present Position]

Director
1980.04
2013.04
2016.04
2019.06

President, Representative Director
1977.04
2011.04
2013.04
2013.06

Joined the Company
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Member of the Board
Senior Managing Executive Officer,
Representative Director
Executive Vice President,
Representative Director
Chief of Business Administration Division[Present Position]

Director
1978.04
2012.04
2015.04
2015.06

Yoshiyuki Murata

Joined the Company
Executive Officer
Managing Executive Officer
Senior Managing Executive Officer
Senior Managing Executive Officer,
Member of the Board
President and Chief Executive Officer,
Representative Director
Chairman, Member of the Board(Representative Director) [Present Position]

Joined Sapporo Breweries Limited(Present: Sapporo Holdings Limited)
Executive Officer
Managing Executive Officer
Member of the Board; Senior Managing Executive Officer of
Sapporo Breweries Limited (new company)
Managing Executive Officer, Member of the Board of
Sapporo Holdings Limited
President and Chief Executive Officer,
Representative Director, Group CEO
Chairman of the Board, Representative Director
Honorary Counsellor of Sapporo Holdings Limited [Present Position]
Member of the Board of Taisei Corporation[Present Position]

External Board Member
1975.04
2005.04
2008.04
2008.06
2010.04
2012.04
2012.06
2013.04
2019.04
2019.06

Joined Marubeni Corporation
Executive Officer
Managing Executive Officer
Managing Executive Officer,
Representative Director
Senior Managing Executive Officer
Executive Vice President
Executive Vice President,
Representative Director
President and Chief Executive Officer,
Representative Director
Chairman, Member of the Board[Present Position]
Member of the Board of Taisei Corporation[Present Position]

1974.04
2006.04
2008.10
2009.04
2012.04
2017.04
2017.06
2019.06

Terunobu Maeda

External Audit & Supervisory Board Member
1968.04
1995.06
1997.05
2001.05
2002.01
2002.04
2003.01
2009.04
2011.06

1998.03
2004.072005.09
2010.03
2011.032012.06

Joined National Police Agency
First Secretary, Embassy of Japan inGermany, Ministry of Foreign Affairs
Police Commissioner,
Tokushima Prefectural Police
Auditor-Secretary,
Hanshin Expressway Company Limited
Police Commissioner,
Ibaraki Prefectural Police
Chief of Police, Chugoku District
Chief of Police, Kanto District
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

Audit & Supervisory Board Member (Full-Time)1981.04
2014.04

2016.04

2016.06

Shigeru Morichi

1996.04
2004.04
2004.04
2011.04
2012.06

Kunitoshi Saito

Joined the Company
General Manager of Contract &Claims Management Department,International Operations Headquarters
General Manager of International Business
Strategy Department,International Operations Headquarters
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

External Audit & Supervisory Board Member
1966.04
1987.03

Joined Fuji Bank, Ltd.
Director
Managing Director
Vice-president
Director of Mizuho Holdings, Inc.
President andChief Executive Officer, Director
President and Chief Executive Officer ofMizuho Financial Group
President Emeritus
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

Kiwamu Miyakoshi External Audit & Supervisory Board Member
1977.04
1987.04

Akihiko Noma

Joined the Company
Executive Officer
Chief of Housing Business Division
President and Representative Director of
TAISEI HOUSING CORPORATIONManaging Executive Officer of Taisei
Corporation
President and Representative Director of
Taisei-Yuraku Real Estate Co., Ltd.
Member of the Board
Senior Advisor
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

Joined Japan National Railways
Professor of Civil Engineering, School of Engineering,Tokyo Institute of Technology
Professor of Social Infrastructure Engineering,
Graduate School of Engineering, University of Tokyo
Professor,
National Graduate Institute for Policy Studies
Vice Chairman, The Institution For Transport Policy Studies
President, The Institute For Transport Policy Studies
Director of Policy Research Center of
National Graduate Institute for Policy Studies[Present Position]
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

About the Taisei Group

Audit & Supervisory Board Member (Full-Time)

External Audit & Supervisory Board Member
1977.04
2009.122011.05
2013.032016.06

Joined Board of Audit of Japan
Director General of 3rd Bureau,
Board of Audit
Director General of 5th Bureau,
Board of Audit
Secretary General, Board of Audit
Audit & Supervisory Board Member ofTaisei Corporation [Present Position]

Special Feature

Takashi Hayashi

Toward Sustainable Growth of the Taisei Group

Audit & Supervisory Board Members

Data Section

ESG Section

3: Atsuko Nishimura, Takao Murakami, Norio Otsuka, Fumiya Kokubu, Terunobu Maeda, Shigeru Morichi, Kiwamu Miyakoshi and Kunitoshi Saito are independent officers in accordance withthe rules of Tokyo Stock Exchange and Nagoya Stock Exchange.

Business Section

Notes 1: Atsuko Nishimura, Takao Murakami, Norio Otsuka, and Fumiya Kokubu are External Members of the Board as defined by the Companies Act, Article 2-XV.
2: Terunobu Maeda, Shigeru Morichi, Kiwamu Miyakoshi and Kunitoshi Saito are External Audit & Supervisory Board Members as defined by the Companies Act, Article 2-XVI.

TA I SE I A N N UA L R E P O R T 2 0 1 9 68

ESG Section
ChairmanTakashi Yamauchi

Executive Officers
President and Chief Executive Officer
Yoshiyuki Murata
Vice Chairman and Executive Officer
Kazuhiko Dai
Executive Vice Presidents
Shigeyoshi Tanaka
Chief of Civil Engineering Division;
In charge of Safety Administration

Hiroshi Tsuchiya
Chief of Marketing & Sales (Building Construction)
Division I
Susumu Morita
Chief of Energy Division
Noriaki Kon
Chief of Procurement Division

Shigeyuki Sakurai
Chief of Business Administration DivisionNobuyuki Hayashi
General Manager of Design Department, Civil Engineering
Division

Masahiro Sakai
Chief of Marketing & Sales Division (Integrated)

Atsushi Yamamoto
Chief of Marketing & Sales Promotion Division

Senior Managing Executive Officers
Yoshinobu Shigeji
In charge of Marketing & Sales (Building Construction),
Marketing & Sales Division (Integrated)

Hiroshi Kimura
Deputy Chief of Marketing & Sales Division (Integrated),
Supervising Marketing & Sales (Civil Engineering)
Divisions;Chief of Marketing & Sales (Civil Engineering) Division

Katsuyuki Kanai
Chief of Urban Development Division
Shoji Kondo
Chief of Nagoya Branch
Norihiko Yaguchi
Deputy Chief of Marketing & Sales Division (Integrated),
Supervising Marketing & Sales (Building Construction)
DivisionsTakao Kanai
Chief of Marketing & Sales (West Japan) Division
Hiroshi Shirakawa
Chief of Marketing & Sales (Building Construction)
Division II

Jo Iwata
Chief of Proposal & Solutions Division;
In charge of Community Design & IR Development
Department;
In charge of Olympic and Paralympic Projects
Fumihiko Sudoh
Chief of Tokyo Branch
Yuichi Kitaguchi
In charge of New National Stadium Project, Tokyo Branch
Yasumitsu Sakurai
Deputy Chief of International Operations Headquarters
Shun Kitano
Chief of Safety Administration Division

Managing Executive Officers
Kazuhiko Hombu
In charge of Technology;
In charge of Energy & Environment

Hiroshi Harada
In charge of Civil Engineering Projects, Civil Engineering
Division

Masahiro Oshima
Chief of Corporate Planning Office

Yoshihiro Teramoto
Chief of Yokohama Branch

Yasushi Yoshinari
Chief of Medical & Pharmaceutical Business Division

Executive Officers
Shimpei Oguchi
Deputy Chief of Marketing & Sales (West Japan) Division,in charge of Building Construction

Masaharu Okada
Chief of Marketing & Sales (Building Construction)
Division III
Masao Yoshikawa
In charge of Marketing & Sales (Building Construction),
Marketing & Sales Division (Integrated)
Takeshi Kagata
Chief of Kansai Branch
Jirou Taniyama
Deputy Chief of Civil Engineering Division;
General Manager of Civil Engineering Department
Yoshiro Aikawa
Chief of Architecture & Engineering Division (Integrated);
Chief of Building Construction Division
Keiji Hirano
Chief of International Operations Headquarters

69 TA I S E I A NNUA L R EPORT 2019

Taku Yamamoto
In charge of Marketing & Sales (Building Construction),
Marketing & Sales Division (Integrated)
Atsushi Suzuki
Chief of Mechanical & Electrical Division
Shunichi Sonoda
Deputy Chief of Marketing & Sales (Building Construction)
Division III
Makoto Ohta
General Manager of International Projects Management
Department, Civil Engineering Division
Toru Inaba
Deputy Chief of International Operations Headquarters(Building Construction & Engineering)Kenji Shirakawa
Chief of Chiba Branch

Shinsaburo Sawa
Deputy Chief of Marketing & Sales (Building Construction)
Division I

Shinichiro Takahama
Chief of Engineering Division

Yoshio Abe
Deputy Chief of Marketing & Sales (Civil Engineering)
Division;
General Manager of Marketing & Sales Department;
In charge of Olympic and Paralympic Projects
Akira Ejima
Chief of Chugoku Branch
Iwao Nishioka
Chief of Hokushinetsu Branch
Akira Nakaya
Chief of Shikoku Branch

Koichiro Okuhata
Chief of Kanto Branch
Shinichi Hirajima
Chief of Sapporo BranchToshihiko Aoki
Deputy Chief of International Operations Headquarters(Civil Engineering);
General Manager of Civil Engineering Department
Minoru Hamanaka
Deputy Chief of Marketing & Sales (Building Construction)
Division II

Toward Sustainable Growth of the Taisei Group

Masahiko Okada
General Manager of Secretarial Department

Naohisa Hirata
Chief of Tohoku Branch

Yasuji Yamauchi
In charge of Technology

Special Feature

Shinji Kawamura
Chief of Kyusyu Branch

About the Taisei Group

Yasushi Kamezawa
Chief of Environment Division

Yoshihiko Ikeuchi
Deputy Chief of Marketing & Sales (Civil Engineering)
Division;
General Manager of Marketing & Sales Department
Ichiro Nagashima
Chief of Taisei Technology Center

Katsuhiko Kitagawa
In charge of Marketing & Sales (Building Construction),
Marketing & Sales Division (Integrated)

Executive Fellows

Hirotoshi Ikeda
Deputy Chief of Architecture & Engineering Division (Integrated)
Miyoshi Kato
In charge of Energy & Environment
Yozo Shinozaki
Deputy Chief of Design Division

Tsuyoshi Maruya
Deputy Chief of Taisei Technology Center;
General Manager of Infrastructure Technology Research
Department
Takaharu Yamamura
Deputy Chief of Urban Development Division

Data Section

Toshihiko Tsuka
In Charge of Information Planning, Corporate Planning Office

ESG Section

Business Section

Weiyu Chung
General Manager of Marketing & Business Development
Department (Taiwan), International Marketing & Business
Development Division

TA I SE I A N N UA L R E P O R T 2 0 1 9 70

ESG Section

Corporate GovernanceRisk Management / Compliance» Risk Management Policy and Management Systems
At Taisei Corporation, we have formulated a Risk Management Policy and built systems to implement risk management across thewhole company in order to respond to risk escalation following changes in the business environment.
In terms of handling risk management, we set forth the Basic Risk Management Rules and we identify and select risks
associated with quality and technology, laws and regulations, compliance, information, safety, labor and employment, theenvironment, natural disasters and others that influence business activities every year. Depending on their importance, we thenclassify risks into categories such as “important company-wide risk” or “risk within the jurisdiction of head office” and we develop,
implement, evaluate and improve (follow the PDCA cycle) risk countermeasures.
We implement effective risk management across the whole company including measures to prevent any reoccurrence bysharing this information with the Risk Management Committee and the Risk Management Council.
Company-Wide Risk Management System
Board

ReportPresident & CEO
Chief Risk Management Officer
ReportIncident / Accident Response

Instruction / OrderCountermeasures and Prevention of Reoccurrence

CRO (Chief of Business Administration Division)
Surpervison of risk management

Risk Management Committee
CRO Secretariat

Risk Management Council
Head Office Risk Management Promotion Committee

Head Office

Branch Offices

Group Compannies

Branch Offices Risk Management Promotion Committee➡ Please refer to the business and other risks in the Securities Report for the main issues that may have a major impact on investor decisions.

» Initiatives for Business Continuity Planning (BCP)
In order to meet its responsibilities as a general construction company supporting the infrastructure for economic activities even intimes of disaster, Taisei Corporation has established the Policy on Business Continuity in Times of Disaster and aims to become acompany that gains the trust of society by contributing to business continuity at central and local governments and corporations.
Based on this Policy, we formulate the Business Continuity Plan to be implemented in times of disaster, conduct disastercountermeasure training at least once a year, and fully review and update the Business Continuity Plan based on the results of the
training and other factors each time.

FY2018 Large-Scale Disaster Countermeasure Training
Taisei Corporation conducted the FY2018 Large-Scale Disaster Countermeasure Training in November 2018 based on its BusinessContinuity Plan. A total of approximately 18,000 officers and employees from the head office, 13 branches across the country andall 25 Group companies participated in the training (see p.108).
Setting the theme of this training as “establishing and verifying the initial action system that functions even at times of confusion immediately
after the outbreak of a disaster,” we informed the members of each countermeasure/response headquarters of the time of outbreak of thedisaster, the transportation status and the availability of a building for use on the
day of the training to replicate the confusion at the time of initial response andcarried out increasingly practical training.

In addition, to prepare for a situation where the managers of thecountermeasure/response headquarters are unable to gather at theheadquarters due to paralyzed traffic functions, etc. and provide prompt
instructions, we set up multiple temporary contact points at branches in
the Tokyo metropolitan area and conducted training where also on the
day of the training some of the managers of countermeasure/response
headquarters temporarily gathered at such temporary contact points andtook command remotely.

71 TA I S E I A NNUA L R EPORT 2019

Large-scale disaster countermeasure training being held
(6th floor of Head Office building; Disaster Response Main Headquarters)

Compliance Promotion System
President & CEO
CP*1 Committee

Administrative Structure
Business Administration Div.

Secretariat

Special Feature

CP Promotion Section*2

CP General Promoter(General Manager ofGeneral Affairs Department)

Implementation Structure
Head Office

Branches

Division CP Manager (Chief of Division)
Division CP Promoter(General Manager in Charge of Administration)

Division CP Manager (Chief of Branch)
Division CP Promoter (Administrative Manager)

CP Implementers (All Department General Managers)*3

CP Implementers (All Department General Managers)*3

All Executives and Employees

All Executives and Employees*1 CP: abbreviation of compliance*2 Promotes and embeds compliance awarenessamong officers and employees. Also functions as asecretariat for the Compliance Committee.
*3 All heads of departments are appointed compliance implementers. The heads of each department
educate and inform all officers and employees intheir own departments about compliance.

» Raising Awareness of Compliance
Taisei Corporation systematically implements education and training to raise awareness of compliance. We strive to establish
awareness for compliance among personnel by implementing e-learning and publishing the Compliance newsletter on familiar
topics related to compliance, and are expanding these efforts to personnel of Group companies as well.
We also endeavor to strengthen group compliance by organizing periodic conferences for staff who are responsible for legal
affairs at the domestic Group companies as a system for information sharing and exchange of opinions regarding issues related
to legal affairs.
In addition, we are working to enhance awareness for compliance by holding compliance-related trainings for
specialized contractors.

Business Section

CP General Manager(Chief of Business
Administration Division)

ESG Section

Head Office

About the Taisei GroupThe Action Guidelines for Taisei Personnel and the Taisei Group as a Whole state that in order to fulfill its social responsibilities,
the Taisei Group shall adhere to laws and regulations, etc. (laws and ordinances, by law, administrative guidance, customs andother social rules, and various company rules and regulations).
The guidelines also state that the company must act in good faith and fulfill contracts and promises with customers,
suppliers, or the local community in all sincerity.
As indicated in the diagram below, each department at Taisei Corporation has deployed managers, promoters, andimplementors to install the in-house compliance promotion system and to strengthen compliance by incorporating the opinions
and recommendations of the Compliance Committee, which has been established as a special committee serving as the
President’s advisory committee and chaired by an external expert (lawyer), and exchanging opinions with the Committee(see p.61).

Toward Sustainable Growth of the Taisei Group» Compliance Policy and Systems

Education and Training for Raising Awareness of Compliance
Officers and employees
Distribute the Compliance Newsletter (once a month)● Implement e-learning (as necessary *Four times in FY2018)● Implement group training(as necessary)●

Training /education
conducted

Group
Organize conferences for staff responsible forlegal affairs at Group companies in Japan(once a year)● Conduct Group compliance interviews on
Group companies in Japan (once a year)● Provide guidance on KPI establishment toGroup companies in Japan●

Specialized contractors
Implement compliance training at the Safety
Conference*4 (once a year)● Implement compliance training for new
employees of Soyukai member companies(twice a year)● Promote CSR procurement●

Data Section

Subject
organization*4 A conference that aims to inform specialized contractors about ensuring safety management.

TA I SE I A N N UA L R E P O R T 2 0 1 9 72

ESG Section

Corporate GovernanceRisk Management / Compliance» Measures to Ensure Thorough Compliance［１］Whistleblowing and Consultation System
At the Taisei Group, we have set up the Corporate Ethics Helpline, a system for whistleblowing and consultation where acts
contravene laws and ordinances or the Action Guidelines for Taisei Personnel and the Taisei Group as a Whole. We haveestablished consultation desks in-house and at an external organization (a law firm).
At these in-house and external consultation desks, we accept whistleblowing reports from external parties.
When handling whistleblowing reports, we abide by the Whistleblower Protection Act and treat all information about thewhistleblower as confidential and prohibit any adverse action as a direct result of whistleblowing. Furthermore, we accept
anonymous tips in order to find a clue of a wide range of illegal activities.
We carry out fact-finding investigations on the whistleblowing reports received, and respond appropriately, including taking
corrective measures as needed.
We accept any consultation from external stakeholders at our inquiry counter.
Flow of Internal Whistleblowing Based on the Helpline System
President & CEO / Board
ReportCSR Committee
ReportGeneral Manager: CRO*
Consultation Desk
Person in charge of implementation:
General Manager of General Affairs Dept.

Whistleblower (anonymous whistleblower accepted)
Taisei Corporation and its Group companies
Corporate officers

Employees

Employees on
secondment
Temporary workers

Dispatchedtemporary staff
Retired personnel

Post/EmailEmailIn-house consultation desk:Manager of Compliance Promotion Office
External consultation desk:
Law firm

Instruction for investigation
Investigation, discussion on
corrective action, and report

Departmentsin charge*CRO: Chief Risk Management Officer［２］Verification of Compliance with Laws and Regulations (Guidance)
In order to ensure the legitimacy of bids, Taisei Corporation operates an in-house system whereby the heads of branch offices
confirm, produce the documents, and keep all bids on file.
Every year, the legal department verifies the legitimacy of bids and checks compliance with the Construction Business Act,
Antimonopoly Act and the Subcontractors Protection Act. The results are reported to the in-house Auditing Department.

［３］Initiatives to Ensure Fair Subcontracts and Eliminate Anti-Social Forces
Taisei Corporation has adopted Promoting Partnerships with Supply Chains in its Action Guidelines for Taisei Personnel and theTaisei Group as a Whole, and declares “Promoting partnerships with subcontractors and suppliers” and stipulates thattransactions be conducted on an equal footing.
Furthermore, we have set out Measures for Dealing with Anti-Social Forces and Organizations, stipulating that we will take aresolute stance against anti-social forces and will not comply with illegitimate demands. In order to eliminate anti-social forces,
we have included a condition in our contracts, including the basic contract for specialized sub-contractors, declaring that the
supplier is not an anti-social force and that if revealed otherwise, the contract may be cancelled without notice.

［4］Prohibition of Bribery and Other Fraudulent Acts
At Taisei Corporation, we have set forth “Ensuring fair trade” and “Maintenance of proper relationships withindividuals or entities engaged in politics and government” under the Action Guidelines for Taisei Personnel andthe Taisei Group as a Whole and implement Group-wide initiatives to prevent bribery and other misleading acts.
In April 2018, we signed the United Nations Global Compact and have been making sure we prevent
corruption based on one of the ten principles, “Business should work against corruption in all its forms,
including extortion and bribery.”In the previous fiscal year, we organized enlightenment activities for all officers and employees to prevent
bribery of foreign public officials.

73 TA I S E I A NNUA L R EPORT 2019

Taisei Corporation has formulated the Policy on Intellectual Property, based on which we practice our Intellectual Property
Strategy. We strategically manage and utilize all intellectual property including patents, copyright, construction and businessknow-how to promote management that is focused on intellectual property. Regarding management of intellectual property,
we intend to improve operational efficiency through building a search function for our own patents and preparing a databasefor managing patents.
We have tightened the handling of classified information and we have established Rules for Handling Intellectual Property
Information in order to prevent leaks of technical know-how or other confidential business information. We also take measures
to reduce the risk of infringing the intellectual property rights of third parties, such as making technical departments andbusiness departments thoroughly aware of other companies’ patent information.
In addition, we conduct training to ensure that employees are fully informed about this policy and utilize intellectual
property strategically in order to strengthen our competitiveness and improve our corporate value. In FY2018, we conducted
intellectual property courses for technical departments in the head office and operations departments in branch offices as wellas e-learning for all officers and employees, including the utilization of application rights and a series of awareness raising
campaigns about infringement (see p.108).

» Information Security Measures
Taisei Corporation has formulated policies and action guidelines in order to protect and make appropriate use of company
information. We have systematically built rules and regulations concerning company-wide information security systems andinformation management. We established Taisei-SIRT in order to strengthen the system for responding to security incidents*
involving electronic information. We have been actively involved in the Nippon CSIRT Association since joining in March 2013.
Under the slogan “ICT Safety First!,” Taisei Corporation implements a range of information security measures.
Together with all Group companies, specialized constructors, and other partner companies, we aim for zero incidents related
to information security.
We have been promoting a tighter information security environment at overseas business offices and construction sites since
FY2016. We have summarized the minimal rules to be followed in a pamphlet, and conducted education and instruction for all
officers and employees as well as specialized constructors and other partner companies. In FY2018, we conducted 19 sessionsof company-wide information security training and the number of major information security accidents came down to zero (seeKPIs on p.60).

About the Taisei Group
Toward Sustainable Growth of the Taisei Group» Practicing Intellectual Property Policy and Intellectual Property Strategy

Special Feature

1. Revision and tightening of internal rules relating to contacts with competitors (September 2018)
2. Reinforcement of procedures to confirm the appropriateness of the bidding process (September 2018)
3. Carrying out re-education to ensure compliance with the Anti-Monopoly Act
・Implementation of e-learning for all officers and employees (September 2018)
・Implementation of training by an external lawyer for officers and employees in the sales departments and thetechnical departments that engage in operations related to taking orders (October and November 2018)

Business Section

Taking the fact seriously that we were indicted on suspicion of violating the Anti-Monopoly Act in connection with the Linear
Chuo Shinkansen construction project, we have implemented the measures indicated below based on deliberations by theCompliance Committee chaired by an external lawyer and resolution by the Board.

ESG Section» Priority Initiatives Taken in FY2018

To spread and consolidate the Group Philosophy among employees while connecting it to social demands and in-house initiatives,
we have operated annual trainings about the Group Philosophy based on an e-learning format since FY2011. In FY2018, we heldan e-learning session for employees on the theme of the relationship between the Group Philosophy and improvements in corporate
value required by Observing the Charter of Corporate Behavior of the Keidanren (Japan Business Federation), with a participation
rate of 97%.

Data Section» To Share Our Philosophy and Values

TA I SE I A N N UA L R E P O R T 2 0 1 9 74

Explanation and Analysis of Business Results
TAISEI CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2018 and 2019

Thousands of
U.S. Dollars*1

Millions of Yen(except for per share figures)

Contract backlog at the beginning of the year

(except for per share figures)

2018

2019

2019

¥ 2,249,221¥ 2,407,221$ 21,688,630

7.0 %

1,743,498

1,693,859

15,261,366(2.8)

New orders received during the year

Change (%)

1,585,498

1,650,878

14,874,115

4.1

Contract backlog at the end of the year

¥ 2,407,221¥ 2,450,202$ 22,075,881

1.8 %Net income attributable to owners of parent¥¥$ 1,014,254(11.2)%Net sales

126,788

112,572

Per share (in yen and dollars)

561.36511.90

4.61

(8.8)

Cash dividends applicable to the year

28,03228,356

255,482

1.2

85.00

130.001.17

52.9

Per share (in yen and dollars)
Net assets

669,020722,390

6,508,605

8.0

2,975.02

3,302.86

29.76

11.0

1,910,598

1,846,176

16,633,715(3.4)

Per share (in yen and dollars)
Total assets*1 U.S. dollar amounts above and elsewhere in this Annual Report were translated from yen, for convenience only, at the rate of U.S. $ 1 = ¥ 110.99, the approximate exchange
rate at March 31, 2019.
*2 The net assets per share and the net income per share are calculated assuming that the consolidation of shares took place at the beginning of the year ended March 31, 2018,
because the consolidation of shares, at the ratio of 1 share for 5 shares, was implemented on October 1, 2017.
*3 Total annual dividends per share as of March 31, 2018 is ¥ 85.00 ,which is the sum of the interim dividend per share of ¥ 10.00 and the year-end dividend per share of ¥ 75.00.
Due to the consolidation of shares at the ratio of 1 share for 5 shares implemented on October 1, 2017, the year-end dividend per share of ¥ 75.00 reflects this consolidation,
while the interim dividend per share of ¥ 10.00 does not.
If the interim dividend per share is calculated based on the consolidation of shares, it would be ¥ 50.00, making the total annual dividends per share ¥ 125.00.
*4 Effective from the year ended March 31, 2019, the Group retrospectively applied “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement
No.28, February 16, 2018).
The Group applied this change retrospectively and restarted the FINANCIAL HIGHLIGHTS from the year ended March 31, 2018, accordingly.

Status of Results
While weakness is seen in exports and production in some sectors

levels of public works investment continued, allowing thedue to the protectionist trade policy prevailing in the world economy

construction industry to maintain a good business environment.

and uncertainty over the prospect of the Chinese economy, theUnder these circumstances, the Company and its affiliatedJapanese economy during this fiscal year moderately continued tocompanies reported consolidated results of its operations as

recover overall as consumer spending has recovered responding tofollows:
Orders received decreased by 2.8% compared to the previous

the improved employment and income environments.
In the domestic construction market, private investments infacilities increased backed by strong corporate earnings and highconsolidated fiscal year to ¥ 1,693.8 billion due to a decrease in
Civil Engineering.

Major new orders received during FY ended March 2019
ClientProject

Tokyo Electron Technology Solutions Limited

Tokyo Electron Technology Solutions New Construction of new building of Tohoku
Branch Office

Tokyo International University(Tentative Name) Tokyo International University New Construction of Ikebukuro
International Campus

Harmonic Drive Systems Inc.

Harmonic Drive Systems New Construction of Ariake new plant

Ministry of Land, Infrastructure, Transport and Tourism Naruse Dam Quarry Work (1st Period)
Tohoku Regional Development Bureau
Tokushima Tsuda Biomass Power Plant LLC.

Tokushima Tsuda Biomass Power Plant

Major projects completed during FY ended March 2019
ClientProject

MITSUBISHI ESTATE CO., LTD.
The Tokyo Chamber of Commerce and Industry
TOKYO KAIKAN CO., LTD

New Construction of Marunouchi Niju-Bashi Building

Nippon Television Network Corporation(Tentative Name) Kojimachi New Studio Construction Project

Mitsui Fudosan Co., Ltd
MITSUBISHI ESTATE CO., LTD(Tentative Name) TGMM Shibaura Project New Construction (Building“ A” and Hotel)

Ministry of Land, Infrastructure, Transport andTourism Hokkaido Regional Development Bureau

Teshio River Sanru Dam Construction Project Dam Body Construction WorkWest Nippon Expressway Company Limited

Construction Work of the Shinmeishin Expressway Ikuno-ohashi Bridge(PC upper part Work)

75 TA I S E I A NNUA L R EPORT 2019In our Group, net sales increased by 6.6% compared with the

Building Construction and Real Estate Development.

previous consolidated fiscal year to ¥ 1,130.4 billion due to an

Operating income decreased by 15.7% compared to theincrease in net sales for both the Company and its consolidated

previous consolidated fiscal year to ¥ 153.3 billion due to declining

subsidiaries. Operating income, meanwhile, decreased by 9.0%

profit resulting partly from deterioration of gross profit margin in Civil

year on year to ¥ 87.6 billion due to deterioration of gross profit

Engineering, Building Construction and Real Estate Development.

margin.

About the Taisei Group

2. Building Construction

Net sales increased by 4.1% compared to the previous
consolidated fiscal year to ¥ 1,650.8 billion due to increases in

3. Real Estate Development

operating income, despite an improvement in non-operating income

As for the real estate industry, the condominium market has shownand expenses associated with a decrease in interest expenses, etc.

to be more polarizing as we see that while demand remained strong

Net income attributable to owners of parent decreased by 11.2%

mainly for properties in central Tokyo and convenient areas close tocompared to the previous consolidated fiscal year to ¥ 112.5 billion

stations with sales prices continuing to maintain high levels, somedue to an improvement in extraordinary loss (income) accompanying

properties in the suburbs took a long time to sell. Further, thethe rebound effect of recorded impairment loss in the previous

building leasing market remains steady as the rent continued toconsolidated fiscal year, etc., and a decrease in income taxes. ROE

moderately rise amid strong demand mainly in central Tokyo.
In our Group, net sales increased by 1.7% compared with the(return on equity) decreased by 4.3% compared to the previous

previous consolidated fiscal year to ¥ 121.8 billion, due to an

consolidated fiscal year to 16.2%.

increase in net sales for both the Company and its consolidated
Results according to reporting segment, etc., are as follows (thesubsidiaries. Operating income, meanwhile, decreased by 0.4%

results for reporting segments include internal transactions between

year on year to ¥ 12.9 billion due to deterioration of gross profit

segments).

margin.

1. Civil Engineering

4. OtherIn our Group, net sales was almost at the same level compared with

In our Group, net sales decreased by 1.6% compared with thethe previous consolidated fiscal year at ¥ 468.6 billion. Operating

previous consolidated fiscal year to ¥ 12.1 billion, and operating

income, meanwhile, decreased by 25.8% year on year to ¥ 53.0

income increased by 2.7% year on year to ¥ 1.1 billion.

billion due to deterioration of gross profit margin.

Special Feature

consolidated fiscal year to ¥ 157.9 billion due to a decrease in

Toward Sustainable Growth of the Taisei Group

Ordinary income decreased by 14.8% compared to the previous(Consolidated) Orders received
Millions of Yen
2018

2019

Civil engineering¥

Building construction¥

411,058
1,148,973

113,411

124,586

9,727

9,241

¥ 1,743,497¥ 1,693,859

Real estate development
OthersTotal

520,407
1,099,950

Business Section

Name of reporting segment, etc.:(Consolidated) Sales
2018

2019

Name of reporting segment, etc.:¥¥

439,1091,087,671

113,736

114,855

9,727

9,241

¥ 1,585,497¥ 1,650,877

Real estate development
OthersTotal

441,269
1,020,765

Note: In Orders received and Sales, transactions between segments have been eliminated.

Data Section

Civil engineering
Building construction

ESG Section

Millions of Yen

TA I SE I A N N UA L R E P O R T 2 0 1 9 76

Explanation and Analysis of Business Results
TAISEI CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2018 and 2019

Cash Flows
1. Cash Flows from Operating Activities

2. Cash Flows from Investing Activities

A balance of expenditure of ¥ 71.0 billion was incurred in thisA balance of expenditure of ¥ 82.2 billion was incurred in thisconsolidated fiscal year (excess revenue of ¥ 207.0 billion in the

consolidated fiscal year due to the acquisition of property, plant andprevious consolidated fiscal year) due to an increase in tradeequipment, etc. (expenditure of ¥ 11.8 billion in the previous

receivables and other factors, although income before income taxes

consolidated fiscal year).

of ¥ 160.7 billion was earned in this term.
3. Cash Flows from Financing Activities
A balance of expenditure of ¥ 96.1 billion was incurred in thisconsolidated fiscal year due to the acquisition of treasury stockand repayment of interest-bearing loans associated withprocurement of finance, etc. (expenditure of ¥ 41.6 billion in theprevious consolidated fiscal year).

Cash Flows Status（Billions of Yen）■ Cash flows from operating activities■ Cash flows from investing activities
300.0
200.0

■ Cash flows from financing activities
Increase / decrease in cash and cash equivalents 218.1

163.0

95.3

100.0
24.0
0

(100.0)

207.0
152.5

(13.9) (30.4)(17.2)

34.5(25.0) (35.1)

6.2(60.0)(11.8)(41.6)(71.0)(200.0)(300.0)

2014

2015

2016

2017

(96.1)(82.2)(249.7)2018 (FY)As a result of the above, cash and cash equivalents at the end of¥ 249.7 billion compared with the end of the previous consolidated

this consolidated fiscal year was ¥ 437.5 billion (a decrease of

fiscal year).

Financial Position
1. Assets

3. Net Assets

As a result of a decrease in cash and time deposits, etc., total

Net assets increased by 8.0% or ¥ 53.3 billion compared with theassets decreased by 3.4% or ¥ 64.4 billion compared with the end

end of the previous consolidated fiscal year to ¥ 722.3 billion, dueof the previous consolidated fiscal year to ¥ 1,846.1 billion.

to posting of net income attributable to owners of parent, etc.,
despite carrying out an acquisition of treasury stock.

2. Liabilities
Total liabilities decreased by 9.5% or ¥ 117.7 billion compared with

As a result of the above, the ratio of capital to assets increased by

the end of the previous consolidated fiscal year to ¥ 1,123.7 billion,

4.1% compared with the end of the previous consolidated fiscal

due to a decrease in advances received and progress billings onyear to 39.0%. The balance of interest-bearing loans associateduncompleted contracts, etc.

with procurement of finance decreased by ¥ 29.9 billion from theend of the previous consolidated fiscal year to ¥ 217.4 billion.

77 TA I S E I A NNUA L R EPORT 2019

after taking into consideration the consolidation of sharesconducted on October 1, 2017, and the latest dividend forecast.
The Articles of Incorporation of the Company permit an interim
dividend to be allocated, in accordance with Paragraph 5 of Article
454 of the Companies Act, with dividends allocated twice every
year, at the middle and at the end of the fiscal year. These
dividends are decided at the General Meeting of Shareholders forthe end of term and the Board meeting for the interim dividend.
At the Board meeting on May 10, 2019, acquisition of treasury
stock, the maximum limitation of which is 8,300 thousand shares(¥ 28.0 billion), was resolved in order to increase shareholder
returns and to improve the capital efficiency.

Total dividend amount and dividend per share
Millions of Yen

Yen

Total dividend amount

Dividend per share¥ 13,087¥ 60.00

15,26870.00

Business Section
ESG Section
Data Section

Board meeting, November 8, 2018
General Meeting of Shareholders, June 26, 2019

Special Feature

Resolution meeting date:

About the Taisei GroupThe Company has made it a basic policy to pay long-term stabledividends to shareholders. The Company tries to reinforce internal
reserve for the future business operation, and returns the profit to
the shareholders by way of a special dividend and the like when
the business performance of the Company is well.
With regard to the dividend at the end of the fiscal year ended
March 31, 2019, comprehensively taking into account bothachievement of greater performance than the initial plan, andbusiness surroundings in the future, etc., it has been decided toallocate a dividend of ¥ 70.00 per share.
As a result, the total dividend for the fiscal year ended March
31, 2019, including the interim dividend, is ¥ 130.00 per share, a¥ 5 increase compared to the dividend of the previous fiscal year

Toward Sustainable Growth of the Taisei Group

Dividend Policy

TA I SE I A N N UA L R E P O R T 2 0 1 9 78

Consolidated Balance Sheets
TAISEI CORPORATION and Consolidated Subsidiaries
March 31, 2018 and 2019

Thousands of
U.S. Dollars(Note 1)Millions of Yen
ASSETS

2018

2019

¥

¥

2019

Current assets:
Cash and time deposits (Notes 3 and 4) ...............................

687,456

467,750$ 4,214,344

Notes and accounts receivable, trade (Notes 4 and 7) ..........

441,631542,0094,883,404

Cost on uncompleted contracts ............................................

50,09542,472

382,665

Cost on development projects in progress ............................

86,20796,750871,700

Other inventories ...................................................................

2,757

3,804

34,273

Other current assets (Note 7) ................................................

59,514

47,773

430,426

Allowance for doubtful accounts ...........................................

(173)

(121)

(1,090)Total current assets ............................................

1,327,487

1,200,437

10,815,722

Buildings and structures (Notes 6,10,16 and 20) ...............

136,975

152,138

1,370,736

Machinery, vehicles and equipment (Notes 6,16 and 20) .................

56,17360,380544,013

Land (Notes 6,10,16,18 and 20) ........................................

119,964

135,939

1,224,786

Construction in progress ...................................................

1,523

1,255

11,307

Subtotal .............................................................

314,635

349,7123,150,842

Accumulated depreciation .................................................

(126,238)(129,967)(1,170,979)

Total tangible fixed assets ..................................

188,397219,745

1,979,863

Intangible fixed assets (Note 16) ............................................

11,554

13,028117,380

Investment securities (Notes 4, 5 and 6) ............................

337,382

367,627

3,312,253

Net defined benefit asset (Note 11) ....................................

9,561

11,387

102,595

Deferred income tax assets (Notes 2 and 9) ......................

6,557

3,915

35,274

Other assets (Note 6) .........................................................

31,41331,806

286,566

Allowance for doubtful accounts ........................................

(1,753)(1,769)(15,938)

Total investments and other assets .....................

383,160

412,966

3,720,750

Total fixed assets ..................................

583,111645,739

5,817,993

Total assets ...........................................

¥ 1,910,598¥ 1,846,176$ 16,633,715

Fixed assets:
Tangible fixed assets

Investments and other assets:

The accompanying notes are an integral part of these balance sheets.

79 TA I S E I A NNUA L R EPORT 2019

2019

¥

¥

2019

Notes and accounts payable, trade (Notes 4 and 7) ..............
Short-term loans (Notes 4, 6 and 8) ......................................

509,576
69,304507,335$ 4,570,997

59,924539,904

Current portion of long-term debt (Notes 4, 6 and 8) .............

31,44931,344282,404

Income taxes payable ...........................................................

30,843

18,982

171,024

Advances received and progress billings on uncompleted contracts ....

148,516

99,746

898,694

Deposits received (Note 4) ....................................................

182,142

155,030

1,396,793

Allowance for warranty on completed contracts ....................

3,129

3,475

31,309Allowance for losses on construction contracts (Note 16) ......

9,394

2,761

24,876

Allowance for losses on order received .................................

3

—

—

Allowance for losses on Anti-Monopoly Act ...........................

—

9,129

82,251Other current liabilities (Note 7) ..............................................

38,27037,065333,949

Total current liabilities ...............................

1,022,626

924,791

8,332,201

Long- term liabilities:
Long-term debt (Notes 4 and 8) ............................................

147,321

126,850

1,142,896

Deferred income tax liabilities (Notes 2 and 9) .......................

1,431

6,199

55,852

Deferred income tax liabilities for revaluation of land (Notes 9 and 18) ...

3,286

3,286

29,606Retirement benefits for directors and audit & supervisory board members ..

391

417

3,757

Allowance for losses on investments in subsidiaries and affiliates ...

40

16

144

Allowance for environmental spending ..................................

89

44

396

Allowance for losses on Anti-Monopoly Act ...........................

10,694——

Net defined benefit liability (Note 11) ......................................

35,78742,022

378,611

Other long-term liabilities .......................................................

19,913

20,161

181,647

Total long-term liabilities ........................................................

218,952

198,995

1,792,909

Total liabilities ...........................................

1,241,578

1,123,786

10,125,110

122,742

122,742

1,105,883

Net assets (Notes 12 and 21):
Shareholders’ equity:

About the Taisei Group2018

Current liabilities:

Toward Sustainable Growth of the Taisei Group

LIABILITIES AND NET ASSETS

Special Feature

Millions of Yen

Business Section

Thousands of
U.S. Dollars(Note 1)

Common stock
Issued: 224,541,172 shares ..............................................
Capital surplus ......................................................................

60,19960,199542,382

Retained earnings .................................................................

382,462

465,127

4,190,711

Less: Treasury stock, at cost (Note 23) ..................................

(1,490)(37,503)(337,895)

Total shareholders' equity (Note 23) .........

563,913

610,565

5,501,081

98,579108,782

980,106

ESG Section

Authorized: 440,000,000 shares

Unrealized holding gains on securities, net of taxes ...............
Deferred losses on hedging derivatives, net of taxes (Note 14) ...

(115)

(74)

(667)

Revaluation reserve for land (Note 18) ...................................

(1,245)(1,245)(11,217)

Foreign currency translation adjustments ..............................

(3,058)(3,343)(30,120)

Remeasurements of defined benefit plans, net of taxes (Note 11) ...

9,079

5,738

51,699Total accumulated other comprehensive income ...

103,240

109,858

989,801

Non-controlling interests: .........................................................

1,867

1,967

17,723

Total net assets ........................................

669,020722,390

6,508,605

Total liabilities and net assets ...................

¥ 1,910,598¥ 1,846,176$ 16,633,715

Data Section

Accumulated other comprehensive income:TA I SE I A N N UA L R E P O R T 2 0 1 9 80

Consolidated Statements of Income
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Thousands of
U.S. Dollars(Note 1)Millions of Yen
2018

2019

Construction contracts ......................................................

¥ 1,445,277¥ 1,511,724$ 13,620,362

Real estate development (and other) (Note 10) ..................

140,221

139,154

1,253,753

1,585,498

1,650,878

14,874,115

Cost of sales (Note 19) ..........................................................

1,318,880

1,409,418

12,698,604

Selling, general and administrative expenses (Note 19) .........

84,75888,136

794,089

1,403,638

1,497,554

13,492,693

181,860

153,324

1,381,422

Interest and dividend income ................................................

4,332

4,526

40,778Interest expenses ..................................................................

(1,684)(1,278)(11,515)

Taxes and dues .....................................................................

(12)

(445)

(4,009)Commission expenses ..........................................................

(45)

(356)

(3,207)

Investment gain on equity method ........................................

1,004

1,283

11,560Gains on sales of investment securities (Note 5) ....................

779

153

1,379

2019

Revenue:
Net sales (Note 16):

Costs and expenses (Note 16):

Operating income (Note 16) ......................................................
Other income (expenses):

Gains on sales of tangible fixed assets ..................................

35

1,642

14,794

Reversal of allowance for losses on Anti-Monopoly Act .........

117

1,565

14,100

Write-down of marketable and investment securities (Note 5) ...

(4)

(92)

(829)

Loss on disposal of fixed assets ............................................

(275)

(188)

(1,694)

Loss on investments in related companies ............................

—

(167)

(1,505)

Impairment losses on fixed assets (Notes 16 and 20) ............

(3,631)(340)(3,063)

Other, net (Note 5) .................................................................

(179)

1,150

10,361

437

7,453

67,150

Income before income taxes .....................................................

182,297

160,777

1,448,572

Current ..............................................................................

(51,437)(43,594)(392,774)

Deferred ............................................................................

(4,071)(4,481)(40,373)(55,508)(48,075)(433,147)

Net income ...............................................................................

126,789

112,702

1,015,425

Net income (loss) attributable to non-controlling interests .........

(1)

(130)

(1,171)

112,572$ 1,014,254

Income taxes (Note 9):

Net income attributable to owners of parent .............................

¥

126,788¥

U.S. Dollars(Note 1)

Yen
Amounts per share of common stock:
Net income (Note 21) ........................................................

¥ 561.36¥ 511.90

Diluted net income (Note 21) .............................................

—

—

—

Cash dividends applicable to the year (Note 12) ................

85.00

130.00

1.17

The accompanying notes are an integral part of these statements.

81 TA I S E I A NNUA L R EPORT 2019

$ 4.61

Consolidated Statements of Comprehensive Income

Thousands of
U.S. Dollars(Note 1)Millions of Yen
2018

2019

2019

¥ 126,789¥ 112,702$ 1,015,425

Unrealized holding gains on securities, net of taxes ...............

16,112

10,20591,945

Deferred gains (losses) on hedging derivatives, net of taxes ...

(7)

8

72

Foreign currency translation adjustments ..............................

(30)

(239)

(2,153)Remeasurements of defined benefit plans, net of taxes .........

5,794(3,351)(30,192)

Share of other comprehensive income of associates accounted for by the equity method ...

(1)

(35)

(315)

Total other comprehensive income ........................................

21,8686,588

59,357

Comprehensive income ............................................................

¥ 148,657¥ 119,290$ 1,074,782

Owners of parent ..................................................................

¥ 148,662¥ 119,190$ 1,073,881

Non-controlling interests .......................................................

(5)

100

901

Net income ...............................................................................

About the Taisei GroupTAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Toward Sustainable Growth of the Taisei Group

Other comprehensive income (Note 22):

Business Section
ESG Section
Data Section

The accompanying notes are an integral part of these statements.

Special Feature

Comprehensive income attribute to:

TA I SE I A N N UA L R E P O R T 2 0 1 9 82

Consolidated Statements of Changes in Net Assets
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Millions of Yen

Treasury stock

Total
shareholders’equity¥ 278,614¥ (1,110)¥ 485,396(24,958)—(24,958)—

126,788—

126,788———(25,047)(25,047)

—

0

—

2

2

Retirement of treasury stock ........................................

—(24,665)—

24,665—

Reversal of revaluation reserve for land ........................

—

—

2,018

—

2,018

Changes of shares from transaction with non-controlling shareholders ...

—

(286)

—

—

(286)

Commonstock

Capital surplus

Balance at March 31, 2017 ...........................................

¥ 122,742¥ 85,150

Dividends .....................................................................

——Net income attributable to owners of parent .................

—

Acquisition of treasury stock ........................................
Sale of treasury stock ...................................................

Retainedearnings

Changes other than shareholders’ equity, net ...............

—

—

—

—

—

Balance at March 31, 2018 ...........................................

¥ 122,742¥ 60,199¥ 382,462¥ (1,490)¥ 563,913

Dividends .....................................................................

——(29,907)—(29,907)

Net income attributable to owners of parent .................

——

112,572—

112,572

Acquisition of treasury stock ........................................

—

—

—

(36,014)(36,014)

Sale of treasury stock ...................................................

—

(0)

—

1

1

Retirement of treasury stock ........................................

—

—

—

—

—

Reversal of revaluation reserve for land ........................

—

—

—

—

—

Changes of shares from transaction with non-controlling shareholders ...

—

—

—

—

—

Changes other than shareholders’ equity, net ...............

—

—

—

—

—

Balance at March 31, 2019 ...........................................

¥ 122,742¥ 60,199¥ 465,127¥ (37,503)¥ 610,565

Thousands of U.S. Dollars (Note 1)

CommonStock
Balance at March 31, 2018 ...........................................

$ 1,105,883

Dividends .....................................................................

—Net income attributable to owners of parent .................

—

Acquisition of treasury stock ........................................

—

Capital surplus

Retainedearnings

Treasury stock

Total
shareholders’equity$ 542,382$ 3,445,914$ (13,424)$ 5,080,755—(269,457)—(269,457)—

1,014,254—

1,014,254——(324,480)(324,480)

Sale of treasury stock ...................................................

—

(0)

—

9

9

Retirement of treasury stock ........................................

—

—

—

—

—

Reversal of revaluation reserve for land ........................

—

—

—

—

—

Changes of shares from transaction with non-controlling shareholders ...

—

—

—

—

—

Changes other than shareholders’ equity, net ...............

—

—

—

—

—

Balance at March 31, 2019 ...........................................

$ 1,105,883$ 542,382$ 4,190,711$ (337,895)$ 5,501,081

The accompanying notes are an integral part of these statements.

83 TA I S E I A NNUA L R EPORT 2019

Revaluation
reserve for land¥RemeasureForeign currency ments of definedtranslation
benefit plans, net
adjustmentsof taxes¥

Total
accumulated
othercomprehensive
incomeNon-controllinginterests

Total net
assets¥ 82,463¥ (158)773¥ (2,969)

3,275¥ 83,384¥ 2,034

—

—

—

—

—

—

—

¥ 570,814(24,958)

—

—

—

—

—

—

—

126,788

—

—

—

—

—

—

—

(25,047)

—

—

—

—

—

—

—

2

—

—

—

—

—

—

—

—

—

—

(2,018)——(2,018)

—

—

—

—

—

—

—

—

—

(286)

16,116

43

—

(89)

¥ 98,579¥ (115)¥ (1,245)¥ (3,058)

¥

5,804

21,874(167)

21,7079,079¥ 103,240¥ 1,867¥ 669,020

—

—

—

—

—

—

—

(29,907)

—

—

—

—

—

—

—

112,572(36,014)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

1

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

10,203

41

—

(285)

¥ 108,782¥ (74)¥ (1,245)¥ (3,343)¥(3,341)

6,618

100

6,718

5,738

¥ 109,858¥ 1,967¥ 722,390

Total
accumulated
othercomprehensive
incomeNon-controllinginterests$ 930,174$ 16,821

Toward Sustainable Growth of the Taisei Group

Deferred losses
on hedging
derivatives, netof taxes

Special Feature

Unrealized
holding gains on
securities, net oftaxes

About the Taisei Group

Millions of Yen$ 888,179

Deferred losses
on hedging
derivatives, netof taxes

Revaluation
reserve for land

$ (1,036)$ (11,217)

RemeasureForeign currency ments of definedtranslation
benefit plans, net
adjustmentsof taxes$ (27,552)$ 81,800

Total net
assets$ 6,027,750

—

—

—

—

—

—

—

(269,457)

—

—

—

—

—

—

—

1,014,254

—

—

—

—

—

—

—

(324,480)

—

—

—

—

—

—

—

9

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

91,927369—(2,568)(30,101)

59,627902

60,529$ 980,106$ (667)$ (11,217)$ (30,120)$ 51,699$ 989,801$ 17,723$ 6,508,605

Data Section——

ESG Section

Unrealized
holding gains on
securities, net oftaxes

Business Section

Thousands of U.S. Dollars (Note 1)

TA I SE I A N N UA L R E P O R T 2 0 1 9 84

Consolidated Statements of Cash Flows
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Thousands of
U.S. Dollars(Note 1)Millions of Yen
2018

2019

2019

¥ 182,297
7,050
3,631
(836)
(6,272)(5,476)(342)(4,332)
1,684
4
(758)
—
(35)
275
(1,004)(21,538)
16,948(4,615)
704
4,085
3,356
1,217
3,374
85,141(27,146)
11,011
6,520
254,943¥ 160,777
7,856
340
(37)
(6,633)
6,235(1,565)(4,526)
1,278
92
(123)
167
(1,642)
188(1,283)(99,707)
7,641(10,239)(1,047)
11,545233(1,822)(251)(3,127)(48,947)(27,110)(7,882)(19,589)$ 1,448,572
70,781
3,063(333)(59,762)
56,176(14,100)(40,778)
11,515829(1,108)
1,505(14,794)
1,694(11,560)(898,342)
68,844(92,252)(9,433)104,018
2,099(16,416)(2,262)(28,174)(441,004)(244,256)(71,015)(176,493)

Cash received (paid) during the year for:
Interest and dividend received ...............................................
Interest paid ..........................................................................
Income taxes paid .................................................................
Net cash provided by (used in) operating activities .........

4,792(1,684)(51,031)207,020

4,972(1,283)(55,128)(71,028)

44,797(11,560)(496,694)(639,950)

Cash flows from investing activities:
Decrease (increase) in time deposits .....................................
Purchase of marketable and investment securities ................
Proceeds from sale of marketable and investment securities ...
Purchase of property, equipment and intangible assets .........
Proceeds from sale of property, equipment and intangible assets ...
Other, net ..............................................................................
Net cash provided by (used in) investing activities ..........

705(6,171)
2,041(9,354)591
336(11,852)(30,056)(17,363)
2,117(46,645)9,478
180(82,289)(270,799)(156,438)
19,074(420,263)
85,395
1,622(741,409)

Cash flows from financing activities:
Increase (decrease) in short-term loans .................................
Proceeds from long-term loans .............................................
Repayment of long-term loans ..............................................
Repayment of long-term non-recourse loans ........................
Redemption of non-recourse bonds ......................................
Issue of bonds ......................................................................
Redemption of bonds ...........................................................
Acquisition of treasury stock .................................................
Cash dividends paid, including those to minority interest .......
Other, net ..............................................................................
Net cash provided by (used in) financing activities ..........

(2,105)44,850(43,404)(100)—
19,968(10,000)(25,047)(24,958)(887)(41,683)(9,380)12,600(19,726)(2,950)(500)—(10,000)(36,014)(29,907)(321)(96,198)(84,512)113,524(177,728)(26,579)(4,505)—(90,098)(324,480)(269,457)(2,892)(866,727)

Effect of exchange rate changes on cash and cash equivalents .....
Net increase (decrease) in cash and cash equivalents ...............
Cash and cash equivalents at beginning of year .......................
Cash and cash equivalents at end of year (Note 3) ...................

(925)
152,560
534,787¥ 687,347(247)(249,762)
687,347¥ 437,585(2,225)(2,250,311)
6,192,873$ 3,942,562

Cash flows from operating activities:
Income before income taxes .................................................
Depreciation and amortization ...............................................
Impairment losses on fixed assets .........................................
Increase (decrease) in allowance for doubtful accounts .........
Increase (decrease) in allowance for losses on construction contracts ......
Increase (decrease) in net defined benefit liability ...................
Increase (decrease) in allowance for losses on Anti-Monopoly Act .....
Interest and dividend income ................................................
Interest expenses ..................................................................
Write-down of marketable and investment securities .............
Gain (loss) on sale of marketable and investment securities ....
Loss on investments in related companies ............................
Losses (gains) on sales of tangible fixed assets ....................
Losses on disposal of fixed assets ........................................
Investment losses (gains) on equity method ..........................
Decrease (increase) in trade receivables ................................
Decrease (increase) in cost on uncompleted contract ...........
Decrease (increase) in inventories ..........................................
Decrease (increase) in other inventories .................................
Decrease (increase) in accounts receivables - other ..............
Decrease (increase) in other current assets ...........................
Decrease (increase) in net defined benefit asset ....................
Decrease (increase) in investment and other assets ...............
Increase (decrease) in trade payables ....................................
Increase (decrease) in advances received and progress billings on uncompleted contracts ...
Increase (decrease) in deposits received ...............................
Other, net ..............................................................................

The accompanying notes are an integral part of these statements.

85 TA I S E I A NNUA L R EPORT 2019

Notes to Consolidated Financial Statements(b) Valuation of Assets and Liabilities of Subsidiaries
In the elimination of the investments in subsidiaries, the assets and liabilities of the subsidiaries including the portion allocated to noncontrolling interests are recorded based on their fair value at the time the Company acquired control of the respective subsidiaries.
(c) Goodwill included in Intangible assets
Significant excesses of investment cost over net equity of consolidated subsidiaries and affiliated companies accounted for by the equity
method are recognized as goodwill (negative goodwill, if credit balance), and amortized principally over the estimated useful lives or less thantwenty years on a straight-line basis. However, immaterial goodwill is charged to income in the year of acquisition. Negative goodwill iscredited to income upon occurrence.
(d) Foreign Currency Translation
Receivables and payables denominated in foreign currencies are translated into Japanese yen at year-end exchange rates. The resulting
exchange gains and losses are reflected in the consolidated statements of income. All revenues and expenses associated with foreign
currencies are translated at rates of exchange prevailing when such transactions are made.
The financial statements of consolidated foreign subsidiaries and affiliated companies under the equity method are translated into
Japanese yen at exchange rates prevailing at the respective year-end dates except for shareholders’ equity accounts, which are translated
at historical rates. The resulting foreign currency translation adjustments are presented in accumulated other comprehensive income in the
net assets section of the consolidated balance sheets.

Toward Sustainable Growth of the Taisei GroupSpecial Feature

The financial statements of non-consolidated subsidiaries, and investments in affiliated companies in which the Group does not have control
but has the ability to exercise significant influence, are accounted for by the equity method.
The financial statements in 20 non-consolidated subsidiaries, mainly consist of TOKYO ACADEMIC SERVICE Co., Ltd. and EHIMEHOSPITAL PERTNERS Co., Ltd. are accounted for by the equity method for the year ended March 31, 2018 and 2019.
Investments in 38 affiliated companies are also accounted for by the equity method for the year ended March 31, 2019 (40 affiliatedcompanies for the year ended March 31, 2018). TAISEI PHILIPPINE CONSTRUCTION, Inc. was excluded from the scope of equity method
as the company was included in the scope of consolidation. One other affiliate was excluded from the scope of equity method due to salesof shares by the Company.
Exclusion of certain small-scale non-consolidated subsidiaries and the affiliated company from the scope of equity method does nothave material effect on the consolidated financial statements.
All consolidated subsidiaries other than 11 consolidated overseas subsidiaries have the same balance sheet date, March 31,
corresponding with that of the Company. As for the 11 consolidated overseas subsidiaries whose fiscal year ends at December 31, theirfinancial statements as of December 31 are used in preparation of the consolidated financial statements. Significant transactions, if any, inthe period from January 1 to March 31 have been adjusted in the consolidated financial statements.

Business Section

2. Summary of Significant Accounting Policies(a) Consolidation and equity method
The Company prepares the consolidated financial statements including the accounts of the Company and those of its majority-owned
subsidiaries, whether directly or indirectly controlled. The consolidated financial statements include the accounts of 32 subsidiaries for theyear ended March 31, 2019 (31 subsidiaries for the year ended March 31, 2018). TAISEI PHILIPPINE CONSTRUCTION, Inc., which had
been an equity method affiliate, was included in the scope of consolidation due to the acquisition of shares by the Group. In addition, TAISEICONCESSION CORPORATION and one other company were included in the scope of consolidation by new establishments.
YB HAMACHO KAIHATSU TMK. and one other company were excluded from the scope of consolidation by liquidation.
Exclusion of certain small-scale subsidiaries from the scope of consolidation does not have material impact on the consolidated financial
statements.
All significant intercompany transactions, account balances and unrealized gains or losses have been eliminated in consolidation.

ESG Section

1. Basis of Presenting Consolidated Financial Statements
The accompanying consolidated financial statements of Taisei Corporation (the “Company”) and its consolidated subsidiaries (collectively the“Group”) have been prepared in accordance with the provisions set forth in the Japanese Financial Instruments and Exchange Law and its
related accounting regulations, and in conformity with accounting principles generally accepted in Japan (“Japanese GAAP”), which are
different in certain respects as to application and disclosure requirements of International Financial Reporting Standards.
The accompanying consolidated financial statements have been reformatted and translated into English (with some expanded
descriptions) from the consolidated financial statements of the Company prepared in accordance with Japanese GAAP and filed with theappropriate Local Finance Bureau of the Ministry of Finance as required by the Financial Instruments and Exchange Law. Certain
supplementary information, included in the statutory Japanese language consolidated financial statements but not required for fairpresentation, is not presented in the accompanying consolidated financial statements.
The translations of the Japanese yen amounts into U.S. dollars are included solely for the convenience of readers outside Japan, using
the prevailing exchange rate at March 31, 2019, which was ¥ 110.99 to U.S. $ 1. The translations should not be construed as
representations of what the Japanese yen amounts have been, could have been, or could in the future be when converted into U.S. dollars
at this or any other rate of exchange.

About the Taisei GroupTAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019(f) Securities
Securities held by the Group are classified into (a) debt securities intended to be held to maturity, (b) equity securities issued by subsidiaries
and affiliated companies, and (c) all other securities that are not classified in any of the categories above (hereafter “available-for-salesecurities”).
Debt securities intended to be held to maturity are stated at amortized cost. Equity securities issued by subsidiaries and affiliatedcompanies that are not consolidated or accounted for by the equity method are stated at moving-average cost. Available-for-sale securities
with available fair market value is stated at fair market value. Unrealized holding gains and losses on securities, net of taxes are reported as aseparate component of accumulated other comprehensive income in the net assets section. Realized gains and losses on sales of suchsecurities are computed using moving-average cost. Other securities with no available fair market value are stated at moving-average cost.

Data Section(e) Cash and Cash Equivalents in the Consolidated Statements of Cash Flows
In preparing the consolidated statements of cash flows, cash on hand, readily available deposits and short-term highly liquid investmentswith maturities not exceeding three months at the date of purchase and with insignificant risks of change in value are considered to be cash
and cash equivalents.

TA I SE I A N N UA L R E P O R T 2 0 1 9 86

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019(g) Revenue Recognition of Construction
Revenue associated with construction contracts of which the outcome can be reliably estimated is accounted for by the percentage-ofcompletion method; otherwise contract revenue is accounted for by the completed-contract method. The percentage of completion at theend of the reporting period is determined by the percentage of the cost incurred to the estimated total costs.
(h) Inventories
The Company and its certain subsidiaries develop real estate projects on their own account. Cost on development projects in progress aremainly stated at the lower of cost based on the specific-identification cost method or net realizable value. For this purpose, the cost includes
the purchase cost of land, incidental costs, direct development costs and (in relation to certain developments by one of the subsidiaries)
interest expenses.
Cost on uncompleted contracts is mainly stated at cost based on the specific-identification cost method.
(i) Tangible Fixed Assets
Tangible fixed assets except for buildings and structures are recorded at cost and depreciated principally by the declining-balance method
over the standard useful lives prescribed in the Corporation Tax Law. Buildings and structures are principally depreciated by the straight-line
method.
(j) Accounting for Lease Transactions
Finance leases, except for certain immaterial or short-term finance leases in which ownership is not transferred to lessee, are capitalized.
Capitalized leased assets whose ownership is transferred to lessee are depreciated by the same method of depreciation applied to property,
plant and equipment. Capitalized leased assets whose ownership is not transferred to lessee are depreciated to a residual value of zero by
the straight-line method over a useful life period corresponding to the lease contract period.
(k) Derivatives and Hedge Accounting
Derivative financial instruments are stated at fair value and changes in fair value are recognized as gains or losses unless derivative financial
instruments are used for hedging purposes.
If derivative financial instruments are used as hedges and meet certain hedging criteria, the Company and its consolidated domestic
subsidiaries defer recognition of gains or losses resulting from changes in fair value of the derivative financial instruments until related losses
or gains on hedged items are recognized.
If interest rate swap contracts are used as hedge and meet certain hedging criteria, net amounts to be paid or received under theinterest rate swap contracts are added to or deducted from the interest on liabilities for which the swap contract were executed.
(l) Income Taxes
The Company and its wholly owned domestic subsidiaries apply the system of consolidated tax returns.
(m) Allowance for Doubtful Accounts
Allowance for doubtful accounts is provided to reserve for probable losses from bad debt. It consists of the estimated uncollectible amountof certain identified doubtful receivables and the amount estimated on the basis of the past default ratio for normal receivables.
(n) Allowance for Warranty on Completed Contracts
Allowance for warranty on completed contracts is provided as the amount estimated using an actual ratio of related losses during the pastcertain periods.
(o) Allowance for Losses on Construction Contracts
Allowance for losses on construction contracts is provided with respect to construction projects for which eventual losses are reasonably
estimated.
(p) Allowance for Losses on Order Received
Allowance for losses on order received is provided with respect to orders (excluding construction contracts) for which eventual losses arereasonably estimated.
(q) Retirement Benefits for Directors and Audit & Supervisory Board Members
Retirement benefits for directors and audit & supervisory board members of certain consolidated subsidiaries have been set up inaccordance with each company’s regulations.
(r) Allowance for Losses on Investments in Subsidiaries and Affiliates
Allowance for losses on investments in subsidiaries and affiliates is provided for estimated losses from certain subsidiaries and affiliates inliquidation.
(s) Allowance for Environmental Spending
Allowance for environmental spending is provided based on estimated costs for disposal of Polychlorinated Biphenyl (“PCB”) waste, which is
obligated to dispose by the Act on Special Measures Concerning Promotion of Proper Treatment of PCB Waste.
(t) Allowance for Losses on Anti-Monopoly Act
Allowance for losses on Anti-Monopoly Act is provided based on estimated payment for penalties under the Anti-Monopoly Act.
(u) Accounting Method for Retirement Benefit
Net defined benefit liability is provided for severance and retirement benefits for employees and executive officers of the Company’s certain
consolidated subsidiaries based on estimated amounts of projected benefit obligations and plan assets at the year-end.
In calculating projected benefit obligations, the method of attributing estimated amounts of retirement benefits to the period until thisfiscal year is based on the benefit formula basis.
Past service costs are amortized using the straight-line method (some consolidated subsidiaries use the declining-balance method) over
1-10 years, which is not longer than an average remaining service period of the employees when the costs are incurred.
Actuarial gains and losses are amortized from the subsequent fiscal year (some consolidated subsidiaries amortize actuarial gains andlosses from the current fiscal year) using the straight line method (some consolidated subsidiaries use the declining balance method) over
1-10 years, which is not longer than an estimated average remaining service period of the employees when the gains or losses are incurred.
(v) Net Income and Cash Dividends per Share
Net income per share is calculated by dividing net income available to common shares by the weighted average number of common shares
outstanding during the year. Cash dividends per share shown for each year represent dividends declared as applicable to the respective
years.

87 TA I S E I A NNUA L R EPORT 2019

(y) Changes in presentation(1) Changes due to application of “Partial Amendments to Accounting Standard for Tax Effect Accounting”(ASBJ Statement No.28, February 16, 2018 (“Statement No.28”))
The Group applied Statement No.28 from the beginning of this fiscal year. Accordingly, the Group changed the presentation, such thatdeferred income tax assets and deferred income tax liabilities are classified as part of investments and other assets and long-term liabilities,
respectively.
As a result, deferred income tax assets of ¥ 24,777 million classified as “current assets” have been included in deferred income tax
assets ¥ 6,557 million in “investments and other assets” in the consolidated balance sheet as of the end of the previous fiscal year. In
addition, due to the effect of offsetting deferred income tax assets and deferred income tax liabilities by the same taxable entity, total assets
and total liabilities decreased by ¥ 20,227 million, respectively.

3. Cash and Cash Equivalents
Cash and cash equivalents as of March 31, 2018 and 2019 consisted of the following:
Millions of Yen

About the Taisei Group

2019¥ 467,750$ 4,214,344

Less: Time deposits with maturities exceeding three months ..................

(109)(30,165)(271,782)

Cash and cash equivalents .....................................................................

¥ 687,347¥ 437,585$ 3,942,562

4. Financial Instruments(1) Policies for using financial instruments
The Group restricts investments to the low risk assets such as deposits, and raise funds by the indirect finance such as loans from bank aswell as by the direct finance such as issuing corporate bonds or commercial papers.
Derivative financial instruments are employed mainly for hedging fluctuation in interest rate and foreign currency exchange, not for
speculation.
Receivables: trade notes and trade accounts are exposed to the credit risks of customers. In order to reduce such risks, the Group conducts
strict credit examinations when orders are received, and afterward manage the receivables individually and make effort to detect reduction of
credit risks early.
For investment securities which are mainly debt securities intended to be held to maturity and shares held to keep the relationship withbusiness partners, the Group regularly monitors the fair value or financial positions of the invested companies, and revises the portfolio timely(except for debt securities intended to be held to maturity) considering the relationship with them.
Debts, trade payables: trade notes and trade accounts are debts mostly due within one year. Loans, commercial papers and bonds areprimarily for working capital, and have maturity dates of five years or less. Although the loans or bonds issued at variable rates are exposed
to interest rate fluctuation risk, the risk is hedged by derivative transactions (interest rate swap contracts).
The Group primarily utilizes derivative transactions related to interest rates in order to mitigate the fluctuation risk in interest rates or to
reduce financing costs, and derivative transactions related to currency in order to mitigate the foreign exchange risk. These transactions are
exposed to the fluctuation risk in interest rates and the foreign exchange risk. However, the Group is exposed to limited risk, because mostof them are hedged by the corresponding transactions. They consider the credit risk to be low, because they conduct derivative transactions
solely with reliable international financial institutions.
The Group executes and manages derivative transactions in accordance with internal rules. Their Finance Departments are responsible
for conducting, evaluating transactions and managing related risks.
(2) Fair Value of Financial Instruments
Book value of the financial instruments was included in the consolidated balance sheet, the fair value of said items as of March 31, 2018 and2019, was as follows. Items for which it is extremely difficult to calculate the fair value were not included in the following table (see “Note 2”
below).

Business Section¥ 687,456

ESG Section

Cash and time deposits ..........................................................................

Thousands of U.S. Dollars
2019

Data Section

2018

Toward Sustainable Growth of the Taisei Group(x) Accounting standard issued but not yet effective
The following standard and guidance were issued but are not yet effective- “Accounting Standard for Revenue Recognition” (ASBJ Statement No.29, March 30, 2018)- “Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No.30, March 30, 2018)(1) Overview
The IASB and the FASB jointly developed and issued a converged Standard on the recognition of ‘Revenue from Contracts with Customers’(IFRS 15 for IASB and Topic 606 for FASB.) in May, 2014. IFRS 15 will be applied from the fiscal year beginning on or after January 1, 2018
and Topic 606 will be applied from the fiscal year beginning after December 15, 2017. Under these circumstances, the ASBJ developed theconverged standard for revenue recognition and issued the “Accounting Standard for Revenue Recognition” along with “Implementation
Guidance on Accounting Standard for Revenue Recognition”.
In developing the ‘Accounting Standard for Revenue Recognition,’ the principal policy of the ASBJ is to incorporate the basic concept of
IFRS 15 from the perspective of comparability between financial statements, as one way to establish consistency with IFRS 15. The ASBJ
will add alternative treatments in the case that there are different accounting treatments prevalent in accounting practices in Japan that
require consideration, to the extent that they do not impair comparability.
(2) Effective date
Effective from the beginning of the fiscal year ending March 31, 2022.
(3) Effects of the application of the standards
The Company and its consolidated subsidiaries are currently in the process of determining the effects of these new standards on the
consolidated financial statements.

Special Feature(w) Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications have no impact onpreviously reported results of operations or retained earnings.

TA I SE I A N N UA L R E P O R T 2 0 1 9 88

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Millions of Yen
2018
Book Value

Fair Value

Difference

ASSETSCash and time deposits ..........................................................................

¥ 687,456¥ 687,456

Notes and accounts receivable, trade .....................................................

441,631441,627¥—(4)

Investment securities
Debt securities intended to be held to maturity ...................................

662

678

16

Available-for-sale securities .................................................................

270,938

270,938—

Notes and accounts payable, trade ........................................................

509,576

509,576—

Short-term loans and long term loans due within one year ......................

87,03087,114(84)

LIABILITIESShort-term non-recourse loans payable ..................................................

2,950

2,967

(17)

Straight bonds due within one year .........................................................

10,00010,012(12)

Non-recourse bonds due within one year ...............................................

500

503

(3)

Deposits received ...................................................................................

182,142

182,142—

Straight bonds ........................................................................................

40,00040,309(309)

Long-term loans .....................................................................................

106,900

107,813(913)[Derivative financial instruments (*)] .........................................................

(10)

(10)

—

Millions of Yen
2019Book Value

Fair Value

Difference

ASSETSCash and time deposits ..........................................................................

¥ 467,750¥ 467,750

Notes and accounts receivable, trade .....................................................

542,009542,009(0)¥—

Investment securities
Debt securities intended to be held to maturity ...................................

619

631

12

Available-for-sale securities .................................................................

299,246

299,246—

Notes and accounts payable, trade ........................................................

507,335

507,335—

Short-term loans and long term loans due within one year ......................

90,952

91,072(120)

LIABILITIESShort-term non-recourse loans payable ..................................................

—

—

—

Straight bonds due within one year .........................................................

—

—

—
—

Non-recourse bonds due within one year ...............................................

——

Deposits received ...................................................................................

155,030

155,030—

Straight bonds ........................................................................................

40,00040,394(394)

Long-term loans .....................................................................................

86,47287,196(724)[Derivative financial instruments (*)] .........................................................

1

1

—

Thousands of U.S. dollars
2019Book Value

Fair Value

Difference

ASSETSCash and time deposits ..........................................................................

$ 4,214,344$ 4,214,344

Notes and accounts receivable, trade .....................................................

4,883,404

4,883,404

(0)

$

—

Investment securities
Debt securities intended to be held to maturity ...................................

5,577

5,685

108

Available-for-sale securities .................................................................

2,696,153

2,696,153—

Notes and accounts payable, trade ........................................................

4,570,997

4,570,997—

Short-term loans and long term loans due within one year ......................

819,461

820,542(1,081)

LIABILITIESShort-term non-recourse loans payable ..................................................

—

—

—

Straight bonds due within one year .........................................................

—

—

—
—

Non-recourse bonds due within one year ...............................................

——

Deposits received ...................................................................................

1,396,793

1,396,793—

Straight bonds ........................................................................................

360,393363,943(3,550)Long-term loans .....................................................................................

779,097785,620(6,523)[Derivative financial instruments (*)] .........................................................

9

9

—

(*) Note: The assets and liabilities are reported as net amounts. Any items for which the total becomes a net liability are indicated inparentheses.

89 TA I S E I A NNUA L R EPORT 2019

[Derivative financial instruments]
See the notes on “14. Derivative Transactions”.
Note 2: Financial instruments which are extremely difficult to calculate the fair value
Nonmarketable securities (book value amount to ¥ 65,782 million and ¥ 67,762 million ($ 610,523 thousand) as of March 31, 2018 and2019, respectively) are not included in the Assets Investment securities–Available-for-sale securities above, as it is extremely difficult to
calculate the fair value because they have no quoted market prices and the future cash flows cannot be estimated.
Note 3: Scheduled redemption amounts after the consolidated balance sheet date for monetary claims and securities with period of
maturities as of March 31, 2018 and 2019 were as follows:
Millions of Yen
2018
Due after one year but
within five years

Due within one year
Time deposits .........................................................................................

¥

Notes and accounts receivable, trade .....................................................

687,018¥

Due after five years but
within ten years—¥ —440,051

1,580

—

45

381

236

Special Feature

Toward Sustainable Growth of the Taisei Group

LIABILITIES∙ Notes and accounts payable, trade, Short-term loans and Long term loans due within one year and Deposits received
The fair value of these financial instruments are almost equivalent to the book value, due to the short term settlements; although, the fairvalue of long-term loans due within one year is based on the same method as that for long-term loans.
∙ Short-term non-recourse loans payable and Long-term loans
The fair value of these financial instruments is based on the present value of discounted cash flows by the interest rate which may be
applicable when the same kind of loans is conducted.
∙ Bonds
The fair value of marketable bonds is based on the quoted market value, otherwise the fair value of nonmarketable bonds is based on thepresent value of discounted cash flows using the interest rate determined by the factors of the estimated redemption terms and issuer’s
credit risk.

About the Taisei Group

Note 1: The calculation method of the fair value of financial instrument and securities, derivative transactions
ASSETS∙ Cash and time deposits and Notes and accounts receivable, trade
The fair value of these financial instruments is almost equivalent to the book value, due to the short term settlements; although, the fair valueof receivables due after one year is based on the present value of discounted cash flows using the interest rate determined by the factors of
the estimated collection terms and credit risks with respect to each receivables categorized by collection terms.
∙ Investment securities
The fair value of marketable securities is based on the quoted market value, and bonds are based on the market value, the price indicatedby a third party such as broker or the present value of discounted cash flows.
See the notes on “5. Securities” for notes pertaining to securities categorized by the purposes for which they are held.

Investment securities
Government bonds .........................................................................
Available-for-sale securities
Government bonds .........................................................................

0

—

—

Total ...................................................................................

¥ 1,127,114¥ 1,961¥ 236

Business Section

Debt securities intended to be held to maturity

Millions of Yen
2019Time deposits .........................................................................................
Notes and accounts receivable, trade .....................................................

¥

467,333¥

Due after five years but
within ten years—¥ —540,248

1,761

—

337

83

199

Investment securities
Debt securities intended to be held to maturity
Government bonds .........................................................................

ESG Section

Due after one year but
within five years

Due within one year

Available-for-sale securities
1——

Total ...................................................................................

¥ 1,007,919¥ 1,844¥ 199

Data Section

Government bonds .........................................................................

TA I SE I A N N UA L R E P O R T 2 0 1 9 90

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

Thousands of U.S. Dollars
2019
Due after one year but
within five years

Due within one year

Due after five years but
within ten years

Time deposits .........................................................................................

$ 4,210,586

Notes and accounts receivable, trade .....................................................

4,867,538

15,866

—

3,036

748

1,793

$

—

$

—

Investment securities
Debt securities intended to be held to maturity
Government bonds .........................................................................
Available-for-sale securities
Government bonds .........................................................................

9

—

—

Total ...................................................................................

$ 9,081,169$ 16,614$ 1,793

Note 4: See the notes on “8. Short-term Loans and Long-term Debt” for notes pertaining to the aggregate annual maturities of long term
debt after the consolidated balance sheet date.

5. Securities(1) Following tables summarized acquisition costs, book value and fair value of securities with fair value available as of March 31, 2018 and2019:(a) Debt securities intended to be held to maturity:∙ Securities with fair value exceeding book value
Millions of Yen
2018
Type
Government bonds ............................

Book value

Fair value

Difference

¥ 662

¥ 678

¥ 16

Millions of Yen

Thousands of U.S. Dollars

2019
Type
Government bonds ............................

2019

Book value

Fair value

DifferenceBook value

Fair value

Difference

¥ 619

¥ 631

¥ 12

$ 5,577$ 5,685$ 108

Securities with fair value not exceeding book value were not applicable as of March 31, 2018 and 2019.
(b) Available-for-sale securities:∙ Securities with book value exceeding acquisition costs
Millions of Yen
2018
Type

Book value

Acquisition cost

Difference

Equity securities .................................

¥ 257,429¥ 113,851¥ 143,578

Government bonds ............................

—

—

—

Others ...............................................

975

642

333

Total ........................

¥ 258,404¥ 114,493¥ 143,911

Millions of Yen

Thousands of U.S. Dollars

2019

2019

Type

Book value

Acquisition cost

DifferenceBook value

Acquisition cost

Difference

Equity securities .................................

¥ 281,476¥ 122,456¥ 159,020$ 2,536,048$ 1,103,307$ 1,432,741

Government bonds ............................

—

—

—

—

—

—

Others ...............................................

1,104

642

462

9,947

5,784

4,163

Total ........................

¥ 282,580¥ 123,098¥ 159,482$ 2,545,995$ 1,109,091$ 1,436,904∙ Securities with book value not exceeding acquisition costs
Millions of Yen
2018
Type

Book value

Acquisition cost

Equity securities .................................

¥ 12,420¥ 14,291¥ (1,871)

Government bonds ............................

0

0

(0)

Others ...............................................

114

114

(0)

Total ........................

¥ 12,534¥ 14,405¥ (1,871)

91 TA I S E I A NNUA L R EPORT 2019

DifferenceThousands of U.S. Dollars

2019

2019

Type

Book value

Acquisition cost

Equity securities .................................

¥ 16,551¥ 19,284

Government bonds ............................

1

Others ...............................................
Total ........................

DifferenceBook value

Acquisition cost

Difference¥ (2,733)$ 149,122$ 173,746$ (24,624)

1

(0)

9

9

(0)

114

114

(0)

1,027

1,027

(0)

¥ 16,666¥ 19,399¥ (2,733)$ 150,158$ 174,782$ (24,624)

About the Taisei Group

Millions of Yen(2) Total sales of available-for-sale securities and the related gains and losses for the years ended March 31, 2018 and 2019 were as follows:
Millions of Yen
Type

Equity securities

OthersToward Sustainable Growth of the Taisei Group

2018
Total

Total amount of available-for-salesecurities sold .................................

¥ 1,531¥—¥ 1,531

Gains on sales of available-for-salesecurities .........................................

779

—

779

Losses on sales of available-for-salesecurities .........................................

20

—

20

Millions of Yen
2019
Equity securities

Others

Total

Total amount of available-for-salesecurities sold .................................

¥ 472

¥—

¥ 472

Gains on sales of available-for-salesecurities .........................................

153

—

153

Losses on sales of available-for-salesecurities .........................................

31

—

31

Special Feature

Type

Thousands of U.S. Dollars
2019
Equity securities

Others

Total

Total amount of available-for-salesecurities sold .................................

$ 4,253$—$ 4,253

Gains on sales of available-for-salesecurities .........................................

1,379

—

1,379

Losses on sales of available-for-salesecurities .........................................

279

—

279

(3) Impairment losses on securities
The Group recognized impairment losses on the following securities for the years ended March 31, 2018 and 2019 were as follows:
Thousands of
U.S. Dollars

2018
¥4

2019
¥ 92

2019
$ 829

ESG Section

Type

Data Section

Millions of Yen
Write-down of investment securities ...

Business Section

Type

TA I SE I A N N UA L R E P O R T 2 0 1 9 92

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

6. Pledged Assets(1) The following assets were pledged as liabilities as of March 31, 2018 and 2019:
Secured liabilities
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Short-term non-recourse loans payable ..................................................

¥ 2,950¥—$—

Short-term loans .....................................................................................

1,600

—

—

Non-recourse bonds due within one year ...............................................

500

—

—

Total ...................................................................................

¥ 5,050¥—$—

Pledged Assets
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Land .......................................................................................................

¥ 6,311¥—$—

Buildings and structures net of accumulated depreciation ......................

1,182

—

—

Machinery, vehicles and equipment net of accumulated depreciation ......

11

—

—

Total ...................................................................................

¥ 7,504¥—$—(2) The following assets were pledged principally as collateral for loans of companies which were not consolidated as of March 31, 2018 and2019:
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Investment securities ..............................................................................

¥ 2,895¥ 2,876

Other assets ...........................................................................................

1,589

1,739

15,668

Total ...................................................................................

¥ 4,484¥ 4,615$ 41,580$ 25,912

7. Amount of notes receivable and notes payable with maturity on the balance sheet date (the “Date”) and the day before the Date(the bank holidays)
Notes receivable and notes payable are processed on the clearing date or the settlement date. As the Date and the day before the Date
were bank holidays, notes receivable and notes payable maturing on that days could not be settled and were included in the consolidatedbalance sheets, as follows:
Millions of Yen
2018
Notes receivable (Trade) ......................................................................
Electronically recorded monetary claims ..............................................

Thousands of U.S. Dollars
2019

¥

593
1,066

2019
¥

315
164

$

2,838
1,478

Notes receivable (Other) ......................................................................

54

29

261

Notes payable (Trade) .........................................................................

6,606

5,606

50,509

Electronically recorded obligations ......................................................

21,62830,407273,962

Notes payable (Other) .........................................................................

8

13

117

Electronically recorded obligations (Other) ...........................................

—

1

9

93 TA I S E I A NNUA L R EPORT 2019

The Group has had no difficulty in renewing such notes and overdraft facility agreements, when they considered such renewal advisable.
Long-term debt as of March 31, 2018 and 2019 consisted of the following:
Millions of Yen
2018

Thousands of U.S. Dollars
2019

About the Taisei Group

8. Short-term Loans and Long-term Debt
Short-term loans as of March 31, 2018 and 2019 mainly consisted of short-term notes and overdrafts from banks. The weighted averageinterest rates of short-term loans as of March 31, 2018 and 2019 were 0.5% and 0.4%, respectively.

2019

Bonds and notes:
500

¥

—

$

—

0.66% yen bonds due in 2018 ........................................................

10,000——0.67% yen bonds due in 2020 ........................................................

10,00010,00090,098

0.14% yen bonds due in 2022 ........................................................

10,00010,00090,0980.527% yen bonds due in 2022 ......................................................

10,00010,00090,098

0.38% yen bonds due in 2027 ........................................................

10,00010,00090,098Loans, principally from banks and insurance companies:
Secured loans (*1) ...............................................................................

2,950

—

—

Unsecured loans .................................................................................

124,625

117,499

1,058,646

Capital lease ...........................................................................................

695

695

6,262

178,770

158,194

1,425,300

Amount due within one year ...................................................................

(31,449)(31,344)(282,404)

Total long-term debt (due after one year) .................................................

¥ 147,321¥ 126,850$ 1,142,896(*) Note 1: These are non-recourse liabilities for the Group.
The annual interest rates applicable to long-term loans due within one year averaged 0.8% and 0.7% as of March 31, 2018 and 2019,respectively, and the annual interest rates applicable to long-term loans due after one year averaged 0.6% as of March 31, 2018 and 2019.
The aggregate annual maturities of long-term debt (including current portion) as of March 31, 2019 were summarized as follows:Year ending March 31,

Millions of Yen

Special Feature¥

Thousands of U.S. Dollars¥ 31,344

2021 .................................................................................................

37,362

282,404
336,6252022 .................................................................................................

19,652

177,0612023 .................................................................................................

48,265434,8592024 .................................................................................................

10,47994,4142025 and thereafter ..........................................................................

11,092

99,937

Total ...................................................................................

¥ 158,194$ 1,425,300

Data Section$

ESG Section

2020 .................................................................................................

Business Section

1.146% yen bonds due in 2018 (*1) ................................................

Toward Sustainable Growth of the Taisei Group

Issued by the Company:

TA I SE I A N N UA L R E P O R T 2 0 1 9 94

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

9. Income Taxes
Taxes on income consist of corporation, enterprise and inhabitants taxes.
The reconciliations for the year ended March 31, 2018 and 2019 are not presented because the difference between the statutory tax
rate and the effective tax rate were less than or equal to 5% of the statutory tax rate.
Significant components of deferred income taxes at March 31, 2018 and 2019 were as follows:
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Deferred income tax assets:
Disallowed portion of expenses and losses:
Net defined benefit liability ...............................................................

¥ 35,566¥ 37,037$ 333,697

Inventories .......................................................................................

13,023

8,188

73,773

Accrued bonuses ............................................................................

7,107

7,148

64,402

Fixed assets ....................................................................................

2,829

2,537

22,858Advances received ..........................................................................

1,173

2,180

19,641Others .............................................................................................

7,842

7,484

67,429Tax loss carryforward ..........................................................................

532

776

6,992

Unrealized profits ................................................................................

7,523

7,414

66,799655,591

Sub-total ............................................................................

75,59572,764

Valuation allowance .............................................................................

(4,288)(4,348)(39,175)

Total ...................................................................................

71,307

68,416

616,416

Unrealized holding gains on securities .................................................

(43,446)(47,948)(432,003)

Deferred income tax liabilities:
Gains on securities contribution to employee retirement benefit trust ...

(17,711)(17,711)(159,573)

Net defined benefit asset ....................................................................

(3,830)(3,920)(35,318)

Others .................................................................................................

(1,194)(1,121)(10,100)

Total ...................................................................................

(66,181)(70,700)(636,994)

5,126¥ (2,284)$ (20,578)

Net total .............................................................................

¥In addition to the deferred income taxes shown above, deferred tax liabilities concerning revaluation of land amounting to ¥ 3,286 million ($29,606 thousand) as of March 31, 2018 and 2019 were presented separately in the consolidated balance sheets.

95 TA I S E I A NNUA L R EPORT 2019

(2) The amounts of investment and rental property which booked in consolidated balance sheets, the amounts of increase or decrease, andfair value as of March 31, 2018 and 2019 were as follows:
Millions of Yen

About the Taisei Group

10. Investment and Rental Property(1) The Company and certain consolidated subsidiaries hold some office buildings for rent in Tokyo and other areas. The rental income on
office buildings for rent was ¥ 2,683 million and ¥ 4,040 million ($ 36,400 thousand) at the year ended March 31, 2018 and 2019,respectively. Rental income is mainly booked in Net sales: Real estate development and other, and rental cost is mainly booked in Cost of
sales.

2018
Increase (decrease)

March 31, 2018

¥ 25,754

March 31, 2018

¥ 82,447

Toward Sustainable Growth of the Taisei Group¥ 56,693¥ 100,065

Millions of Yen
2019Book value
April 1, 2018
¥ 82,447

Fair value

Increase (decrease)

March 31, 2019

¥ 27,271

March 31, 2019

¥ 109,718¥ 138,796

Thousands of U.S. Dollars
2019Book value
April 1, 2018
$ 742,833

Increase (decrease)

Fair value
March 31, 2019

$ 245,707$ 988,540

March 31, 2019
$ 1,250,527

Note 1: The carrying amount is stated at cost of acquisition less accumulated depreciation and impairment losses.
Note 2: The main reasons of increase for the year ended March 31, 2018 was the reclassification from inventories (real estate) amounting to¥ 26,032 million. The main reasons of increase and decrease for the year ended March 31, 2019 were acquisition of fixed assets ¥36,460 million ($ 328,498 thousand) and sales of fixed assets ¥ 7,686 million ($ 69,249 thousand) , respectively.
Note 3: The book value as of March 31, 2018 and 2019 included asset retirement obligations of ¥ 206 million and ¥ 199 million ($ 1,793
thousand), respectively.
Note 4: The fair value of investment and rental property as of March 31, 2018 and 2019 were mainly calculated by the Company according
to the Japanese Real Estate Appraisal Standards (it may include adjustments using official indices).

11. Employees’ Severance and Retirement Benefits
1. The Company and its main consolidated subsidiaries have adopted the defined-benefit pension plans and defined-contribution pension
plans. The defined-benefit pension plans adopted consist of defined-benefit corporate pension plans and lump-sum payment plans.
Liabilities and expenses for severance and retirement benefits of the Company and its consolidated domestic subsidiaries are
determined based on amounts obtained by actuarial calculations. The Company may also pay additional retirement benefits which are notsubject to actuarial calculation.
The Company has established a retirement benefit trust.

Special Feature

April 1, 2017

Fair value

Business Section

Book value

2. Defined-benefit pension plans(1) Movement in retirement benefit obligations
Millions of Yen

Thousands of U.S. Dollars
2019

Balance at beginning of the year .............................................................

¥ 145,642¥ 143,380$ 1,291,828

Current service cost ............................................................................

6,312

6,454

58,149Interest cost ........................................................................................

907

877

7,902

Actuarial loss (gain) .............................................................................

1,310

447

4,027

Benefits paid .......................................................................................

(10,502)(10,741)(96,774)

Past service costs ...............................................................................

(450)

(808)

(7,280)

Other ..................................................................................................

161

239

2,153

Balance at end of the year ......................................................................

¥ 143,380¥ 139,848$ 1,260,005

Some of the consolidated subsidiaries use simplified method for the calculation of retirement benefit obligations.
Retirement benefit expenses in the consolidated subsidiaries applying simplified method are recorded in current service cost.

ESG Section

2019

Data Section

2018

TA I SE I A N N UA L R E P O R T 2 0 1 9 96

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019(2) Movements in plan assets
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Balance at beginning of the year .............................................................

¥ 115,157¥ 117,153

Expected return on plan assets ...........................................................

1,938

2,457

22,137

Actuarial loss (gain) .............................................................................

6,246(4,582)(41,283)$ 1,055,527

Contributions paid by the employer .....................................................

1,056

1,060

9,550

Benefits paid .......................................................................................

(6,360)(5,811)(52,356)

Other ..................................................................................................

(883)(1,064)(9,586)

Balance at end of the year ......................................................................

¥ 117,154¥ 109,213$

983,989(3) Reconciliation from retirement benefit obligations and plan assets to net defined benefit liability (asset)
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Funded retirement benefit obligations .....................................................

¥ 140,567¥ 136,731$ 1,231,922

Plan assets .............................................................................................

(117,154)(109,213)(983,990)

23,41327,518247,932

Unfunded retirement benefit obligations ..................................................

2,813

3,117

28,084

Net total at year-end ...............................................................................

26,22630,635

276,016

Net defined benefit liability ......................................................................

35,78742,022

378,611Net defined benefit asset ........................................................................

(9,561)(11,387)(102,595)

Net total at year-end ...............................................................................

¥

26,226¥30,635$

276,016(4) Retirement benefit expenses
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Current service cost ................................................................................

¥ 6,312¥ 6,454

Interest cost ...........................................................................................

907

877

7,902

Expected return on plan assets ..............................................................

(1,938)(2,457)(22,137)$ 58,149

Net actuarial loss amortization ................................................................

4,238

721

6,496

Past service costs amortization ...............................................................

(1,288)(1,334)(12,019)

Other ......................................................................................................

1

6

54

Total retirement benefit expenses for the year .........................................

¥ 8,232¥ 4,267$ 38,445(5) Remeasurements of defined benefit plans
Items recorded in remeasurements of defined benefit plans (before considering tax effect) were as follows:
Millions of Yen
2018
Past service costs ..................................................................................

Thousands of U.S. Dollars
2019

¥

(838)

2019
¥

(525)

$

(4,730)

Actuarial loss (gain) .................................................................................

9,174(4,309)(38,823)

Total balance as of March 31, 2018 and 2019 ........................................

¥ 8,336¥ (4,834)$ (43,553)(6) Accumulated remeasurements of defined benefit plans
Items recorded in accumulated remeasurements of defined benefit plans (before considering tax effect) were as follows:
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Unrecognized past service costs ............................................................

¥ (6,368)¥ (5,842)

Unrecognized actuarial loss (gain) ...........................................................

(6,760)(2,451)(22,083)

Total balance as of March 31, 2018 and 2019 ........................................

¥ (13,128)¥ (8,293)$ (74,718)

97 TA I S E I A NNUA L R EPORT 2019

$ (52,635)

48%

46%

Bonds ................................................................................................

20

21

General accounts ...............................................................................

18

18

Special accounts ...............................................................................

3

3

Short-term assets ..............................................................................

1

1

Other .................................................................................................

10

11

100%

100%

Total ....................................................................................

The retirement benefit trust established for corporate pension plans accounted for 41% and 40% of total plan assets, for the fiscal year
ended March 31, 2018 and 2019, respectively.
② Long-term expected rate of return
Current and target asset allocations, historical and expected returns on various categories of plan assets have been considered indetermining the long-term expected rate of return.
(8) Actuarial assumptions
The principal actuarial assumptions as of March 31, 2018 and 2019 were as follows:
2018

2019

Discount rate
The Company and its consolidated domestic subsidiaries
Consolidated overseas subsidiaries
Long-term expected rate of return

0.4∼1.5

0.4∼1.5

6.3

7.5∼8.0

1.0∼3.0

1.0∼3.0

3. Defined-contribution pension plans
Amount payable for defined-contribution pension plans of the Company and its consolidated subsidiaries were ¥ 2,490 million and ¥ 2,550
million ($ 22,975 thousand), for the fiscal year ended March 31, 2018 and 2019, respectively.

Data Section

ESG Section

12. Net assets
Net assets comprise three subsections; which are shareholders’ equity, accumulated other comprehensive income and non-controllinginterests.
Under Japanese laws and regulations, the entire amount paid for new shares is required to be designated as common stock. However,a company may, by a resolution of the Board of Directors, designate an amount not exceeding one-half of the price of the new shares asadditional paid-in capital, which is included in capital surplus.
Under the Japanese Corporate Law (“the Law”), when a dividend distribution of surplus is made, the smaller of an amount equal to 10%of the dividend or the excess, if any, of 25% of common stock over the total of additional paid-in capital and legal earnings reserve must be
set aside as additional paid-in capital or legal earnings reserve. Legal earnings reserve is included in retained earnings in the accompanying
consolidated balance sheets.
Under the Law, appropriations of legal earnings reserve and additional paid-in capital generally require a resolution of the shareholders’meeting.
Additional paid-in capital and legal earnings reserve may not be distributed as dividends. Under the Law, however, all additional paid-in
capital and all legal earnings reserve may be transferred to other capital surplus and retained earnings, respectively, which are potentiallyavailable for dividends.
The maximum amount that the Company can distribute as dividends is calculated based on the non-consolidated financial statementsof the Company in accordance with the Law.
Total annual dividends per share as of March 31, 2019 is ¥ 130.00 (U.S. $ 1.2), which is the sum of the interim dividend per share of ¥60.00 (U.S. $ 0.6) and the year-end dividend per share of ¥ 70.00 (U.S. $ 0.6).

Toward Sustainable Growth of the Taisei Group

Equity securities .................................................................................

Special Feature

2019

Business Section

2018① Plan assets comprise:

About the Taisei Group(7) Plan assets

TA I SE I A N N UA L R E P O R T 2 0 1 9 98

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

13. Lease Transactions
Operating leases(a) Lessee
Future minimum lease payments as of March 31, 2018 and 2019 were as follows:
Millions of Yen

Thousands of U.S. Dollars

2018
Due within one year ................................................................................

2019¥ 4,5842019¥ 4,972$ 44,797

Due after one year ..................................................................................

21,265

16,747150,887

Total ...................................................................................

¥ 25,849¥ 21,719$ 195,684(b) Lesser
Future minimum lease receipts as of March 31, 2018 and 2019 were as follows:
Millions of Yen

Thousands of U.S. Dollars

2018

2019

2019

Due within one year ................................................................................

¥ 3,793¥ 3,549

Due after one year ..................................................................................

20,16816,708150,536

Total ...................................................................................

¥ 23,961¥ 20,257$ 182,512$ 31,976

14. Derivative Transactions(1) Derivative transactions of the Company and its consolidated subsidiaries as of March 31, 2018 and 2019 were as follows:① Derivative transactions which were not accounted for by the hedge accounting
Corresponding derivative transactions for the year ended March 31, 2018 and 2019 were not applicable.
② Derivative transactions which were accounted for by the hedge accounting as of March 31, 2018 and 2019 were as follows:· Currency related transactions
Main items hedged by forward foreign exchange contracts are accounts payable for construction contracts.
Millions of Yen
2018
Contract amount
Forward foreign exchange contract (short commitment)

Total

to sell U.S. dollars ...................................................................................

Due after one year
¥ 395

Fair value¥—¥ (10)

Millions of Yen
2019
Contract amount
Forward foreign exchange contract (short commitment)

Total

to sell U.S. dollars ...................................................................................

Due after one year
¥ 60

Fair value¥—¥1

Thousands of U.S. Dollars
2019
Contract amount
Forward foreign exchange contract (short commitment)
to sell U.S. dollars ...................................................................................

Total

Due after one year
$ 541

Note: Fair value was determined at the quoted price obtained from the counterparty financial institutions.

99 TA I S E I A NNUA L R EPORT 2019$—

Fair value$9Special treatment of swap
Millions of Yen
2018
Contract amountDue after one year
¥ 50,540

Fair value¥ 43,770¥—

Millions of Yen
2019
Contract amount
Total
Interest rate swaps receive floating rate, pay fixed rate ...........................

Due after one year
¥ 43,110Fair value¥ 27,890¥—

Thousands of U.S. Dollars
2019
Contract amount
Total
Interest rate swaps receive floating rate, pay fixed rate ...........................

Due after one year
$ 388,413

Fair value$ 251,284$—

Note: Fair value of interest rate swaps was included in the corresponding hedged long-term loans (long-term loans due within one year wasconsidered as short-term loans) as those interest rate swaps were recorded as an adjustment to the corresponding hedged long-termloans under the special treatment.

15. Related Party Transactions
The Company had no transaction with related individuals, including shareholders and directors, for the year ended March 31, 2018 and2019.

Toward Sustainable Growth of the Taisei GroupInterest rate swaps receive floating rate, pay fixed rate ...........................

Special Feature

Total

About the Taisei Group∙ Interest Rate-Related Derivatives:
Main items hedged by interest rate swap contracts are long-term loans.
The following interest rate swaps are used as hedges. The net amounts to be paid or received are added to or deducted from interests.

The Company’s consolidated subsidiaries had the following transaction with related individuals, including shareholders and directors, for theyear ended March 31, 2019, but no transaction was made for the year ended March 31 2018.

Description oftransaction

AmountBalance at the end of the year
Account

Amount(a) Takashi Yamauchi(b) The director of the Corporation(c) —(d) 0.03%

House renovation workby Taisei Housing Co.,
Ltd.

¥ 18

—

¥—

(a) Atsushi Yamamoto(b) The executive officer of the
Corporation(c) —(d) 0.00%

Sale ofcondominium
apartment by Taisei
Yuraku Real Estate Co.,
Ltd.

¥ 72

—

¥—

Data Section

Notes 1. Consumption taxes were not included in the transaction amounts.
2. Transaction conditions and policies to decide transaction conditions(1) The transaction price of house renovation was determined properly on an arm’s length basis as in the case of other generaltransactions. The amount of transaction above represents the contract price on the construction contract.
(2) The transaction price of sale of condominium apartment was determined properly considering normal market prices as in thecase of other general transactions. The amount of transaction above represents the contract price.

ESG Section

2019
Transactions during the year ended March 31, 2019

Business Section

Millions of yen(a) Name(b) Attribution(c) Capital (Million yen)(d) Equity ownership percentage of theCompany

TA I SE I A N N UA L R E P O R T 2 0 1 9 100

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 201916. Segment Information(1) Segment Information(a) General information on reportable segments
Each reportable segment of the Group is a business unit in the Group, whose discrete financial information is available. Reportable segments
are reviewed periodically at the Board of Directors Meeting in order to determine distribution of management resources and evaluatebusiness result of each reportable segment.
The headquarters in the head office are established by the products of construction and the services. Each headquarter proposes
comprehensive domestic and oversea strategies with respect to products and services, and operates its business activities.
The Group consists of segments identified by products and services based on the headquarters, and identifies the three segments, “Civil
engineering,” “Construction contracts,” and “Real estate development” as reportable segments: “Civil engineering” delivering construction ofcivil engineering, etc.; “Construction contracts” delivering construction of building and housing, etc.; “Real estate development” deliveringpurchase, sale and rental of land and buildings, etc.
(b) Basis of measurement of net sales, profit or loss and other material items on reportable segment
The accounting methods for each reportable segment are the same as that set forth in the “Summary of Significant Accounting Policies”.
The profit (loss) of a reportable segment is based on the operating income (loss) before amortization of goodwill in Consolidated Statementsof Income. In addition, conditions of intersegment transactions and transfers are determined by considering market prices as in the case ofother general transactions.
Assets of the Group are not allocated to the segments. However, the corresponding depreciation expenses are allocated to the segments
according to the rational bases such as the usage of assets.
(c) Information of net sales, profit or loss and other material items on reportable segment
Segment information as for the years ended March 31, 2018 and 2019 was as follows:
Millions of Yen
2018
Reportable segments
Civilengineering

Construction
contracts

Real estatedevelopment

Others

Total

Adjustments

Consolidated

Net sales:
Customers ...................................

¥ 441,270¥ 1,020,765¥ 113,736¥ 9,727¥ 1,585,498

Intersegment ................................

25,16139,788

6,095

2,574

73,618¥(73,618)—¥ 1,585,498—

Total .......................

466,4311,060,553

119,831

12,301

1,659,116(73,618)

1,585,498

Operating income ............................

¥ 71,519¥

96,399¥ 12,966¥ 1,114¥

181,998

¥

(138)

¥

181,860

Depreciation and amortization .........

¥

3,135

¥

2,895

¥

1,064

¥

80

¥

7,174

¥

(124)

¥

7,050

Increase (decrease) in allowance forlosses on construction contracts ...

¥(2,171)¥(4,101)

¥

—

¥

—

¥

(6,272)¥—¥(6,272)

Notes 1. ”Others” presented businesses such as incidental business to the construction business, leisure business, and other service
businesses, which are not included in reportable segments.
2. Adjustment amount of operating income was ¥ 138 million, which included intersegment elimination of dividend income.
3. Segment operating income was adjusted against operating income of Consolidated Statement of Income.
Millions of Yen
2019
Reportable segments
Civilengineering

Construction
contracts

Real estatedevelopment

Others

Total

Adjustments

Consolidated

Net sales:
Customers ...................................

¥ 439,110¥ 1,087,672¥ 114,855¥ 9,241¥ 1,650,878

Intersegment ................................

29,54342,768

7,043

2,869

82,223(82,223)—

Total .......................

468,653

1,130,440

121,898

12,1101,733,101(82,223)1,650,878

Operating income ............................

¥ 53,098¥

87,686¥ 12,912¥ 1,144¥

154,840¥ (1,516)¥

153,324

Depreciation and amortization .........

¥

3,357

¥

2,881

¥

1,753

¥

90

¥

8,081

¥

(225)

¥

7,856

Increase (decrease) in allowance forlosses on construction contracts ...

¥

(469)

¥

(6,164)

¥

—

¥

—

¥

(6,633)¥—¥(6,633)

101 TA I S E I A NNUA L R EPORT 2019¥—

¥ 1,650,878

2019
Reportable segments
Real estatedevelopment

Others

Total

Adjustments

Consolidated

Net sales:
Customers ...................................

$ 3,956,302$ 9,799,730$ 1,034,823$ 83,260$ 14,874,115

Intersegment ................................

266,177

385,332

63,45625,849740,814(740,814)—

Total .......................

4,222,479

10,185,062

1,098,279

109,10915,614,929(740,814)

14,874,115$—$ 14,874,115

Operating income ............................

$

478,404$

790,035$

116,335$ 10,307$ 1,395,081$ (13,659)$ 1,381,422

Depreciation and amortization .........

$

30,246$25,957$

15,794$811$

72,808$(2,027)$70,781

Increase (decrease) in allowance forlosses on construction contracts ...

$(4,226)$(55,536)

$

—

$

—

$

(59,762)$—$(59,762)

Notes 1. ”Others” presented businesses such as incidental business to the construction business, leisure business, and other service
businesses, which are not included in reportable segments.
2. Adjustments of operating income of ¥ 1,516 million ($ 13,659 thousand) included intersegment elimination of dividend income
amounting to ¥ 1,433 million ($ 12,911 thousand) and amortization of goodwill amounting to ¥ 83 million ($ 748 thousand).
3. Segment operating income was adjusted against operating income of Consolidated Statement of Income.
(2) Related Information(a) Information about products and services
The information about products and services is included in “(c) Information of net sales, profit or loss and other material items on reportablesegment” of “(1) Segment Information” for the years ended March 31, 2018 and 2019.
(b) Information about geographic areas∙ Net sales
The information about net sales was not presented for the years ended March 31, 2018 and 2019 since sales to unaffiliated customers inJapan accounted for more than 90% of sales of Consolidated Statement of Income.
∙ Tangible fixed assets
The information about tangible fixed assets was not presented for the years ended March 31, 2018 and 2019 since the amounts of tangible
fixed assets that located in Japan accounted for more than 90% of the amounts of tangible fixed assets of Consolidated Balance Sheet.

Toward Sustainable Growth of the Taisei Group

Construction
contracts

Special Feature

Civil
engineering

About the Taisei Group

Thousands of U.S. Dollars(d) Information about impairment losses on fixed assets of reportable segment for the years ended March 31, 2018 and 2019 was asfollows:
Millions of Yen
2018
Reportable segments

Civil engineering
Impairment losses on fixed assets .....

¥ 183

Construction
contracts

Real estatedevelopment¥ 219¥ 3,284

Others¥—Elimination
and/orcorporate¥ (55)

Business Section(c) Information about major customers
The information about major customers was not presented for the years ended March 31, 2018 and 2019 since net sales to any customer
were less than 10% of the amounts of sales of Consolidated Statement of Income.

Total¥ 3,631

ESG Section

Millions of Yen
2019
Reportable segments

Civil engineering
Impairment losses on fixed assets .....

¥ 327

Construction
contracts

Real estatedevelopment

¥ 13

¥—

Others¥—Elimination
and/orcorporate
¥—

Total
¥ 340

Thousands of U.S. Dollars

Civil engineering
Impairment losses on fixed assets .....

$ 2,946

Construction
contracts

Real estatedevelopment

$ 117

$—

Others$—Elimination
and/orcorporate
$—

Total

Data Section

2019
Reportable segments$ 3,063

TA I SE I A N N UA L R E P O R T 2 0 1 9 102

Notes to Consolidated Financial Statements (cont.)
TAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019(e) Information about amortization and unamortized balance of goodwill of reportable segment
There was no information about amortization and unamortized balance of goodwill of reportable segment for the year ended March 31,
2018. Information for the year ended March 31, 2019 was as bellow:
Millions of Yen
2019
Reportable segments

Civil engineering

Construction
contracts

Real estatedevelopment

OthersElimination
and/orcorporate

Total

Amortization of goodwill .....................

¥—

¥ 43

¥ 40

¥—

¥—

¥ 83

Unamortized balance of goodwill .......

¥—

¥ 172

¥—

¥—

¥—

¥ 172

Thousands of U.S. Dollars
2019
Reportable segments

Civil engineering

Construction
contracts

Real estatedevelopment

OthersElimination
and/orcorporate

Total

Amortization of goodwill .....................

$—

$

388

$ 360

$—

$—

$

Unamortized balance of goodwill .......

$—$ 1,550

$ —

$—

$—

$ 1,550

748(f) Information about gains on negative goodwill of reportable segment
Information about gains on negative goodwill for the years ended March 31, 2018 and 2019 was not applicable.

17. Contingent Liabilities
The Group was contingently liable to invest in the specific purpose company for their repayment and other obligations of borrowings with theamount of ¥ 15,680 million as of March 31, 2018. The amounts indicated their shares of the additional investment obligations. As the Groupterminated the contract on March 29, 2019, it was no longer effective as of March 31, 2019.

18. Revaluation Reserve for LandIn the year ended March 31, 2002, certain consolidated domestic subsidiaries executed revaluation of their land for business in accordancewith the Law Concerning Revaluation of Land (the “Law”).
As a result of this revaluation, deferred income taxes concerning the differences between the amounts after revaluation and the bookvalue before revaluation was stated in the assets and liabilities in the consolidated balance sheets. The differences between these amounts,
net of taxes, were stated as “Revaluation reserve for land” in “Accumulated other comprehensive income”.
The revaluation was executed in accordance with the method prescribed in the Article 2, Items 3, 4 and 5 of the Law on November 30,
2001 and March 31, 2002.
One of the consolidated subsidiaries, which was merged with another consolidated subsidiary on December 1, 2001, executed therevaluation on November 30, 2001.
Excess amount of the book value of the revaluated land over the fair value as of March 31, 2018 and 2019 was ¥ 2,374 million and ¥2,472 million ($ 22,272 thousand), respectively (including the excess amount of ¥ 1,489 million and ¥ 1,285 million ($ 11,578 thousand)related to investment and rental property as of March 31, 2018 and 2019, respectively).

19. Research and Development Expenses
Research and development expenses, which were included in selling, general and administrative expenses and cost of sales, amounted to ¥11,608 million and ¥ 12,472 million ($ 112,370 thousand) for the years ended March 31, 2018 and 2019, respectively.

20. Impairment Losses on Fixed Assets
Impairment losses on fixed assets for the years ended March 31, 2018 and 2019 consisted of the following:
2018
Use

Type of assets

Location

Assets reclassified from business purpose to trading purpose

Land and others

Tokyo and the other (2 lots)

Assets for business use

Land, Machinery and equipment, Building, and others

Kyoto and the others (4 lots)

Idle assets

Land

Miyagi (1 lot)
2019

Use

Type of assets

Location

Idle assets

Machinery and equipment

Tokyo (1 lot)

Rental property

Land

Kanagawa (1 lot)

Assets for business use

Machinery and equipment, Building and others

Osaka and the others (8 lots)

103 TA I S E I A NNUA L R EPORT 2019

Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Assets reclassified from business purpose to trading purpose
Buildings and structures ......................................................................

305

¥ —

Land ...................................................................................................

¥

3,222

—

—

Subtotal ..........................................................................................

3,527

—

—
117

$

—

About the Taisei GroupThe Company and its consolidated subsidiaries grouped their fixed assets based on units, for which decisions for investments were made.
Book value of the fixed assets listed above was reduced to recoverable amounts and impairment losses were recognized as follows:

19

13

66

—

—

Machinery and equipment ...................................................................

18

35

315

Others .................................................................................................

0

3

27

Subtotal ..........................................................................................

103

51

459

Rental property
Land ...................................................................................................

—

126

1,135

Subtotal ..........................................................................................

—

126

1,135

Idle assets
Land ...................................................................................................

1

—

—

Machinery and equipment ..................................................................

—

163

1,469

Subtotal ..........................................................................................

1

163

1,469

Total ...................................................................................

¥ 3,631¥ 340$ 3,063

The recoverable amount of the fixed assets for the year ended March 31, 2018 was their net realizable value mainly based on amounts
determined by valuations made in accordance with real estate appraisal standards.
The recoverable amount of the fixed assets for the year ended March 31, 2019 was their net realizable value mainly based on amounts
determined by the sales contract price.

Special Feature

Buildings and structures ......................................................................
Land ...................................................................................................

Toward Sustainable Growth of the Taisei Group

Assets for business use

21. Per Share Data
Net assets per share and net income per share as of and for the years ended March 31, 2018 and 2019 were as follows:Yen
Net assets per share

U.S. Dollars
2019

2019

¥ 2,975.02¥ 3,302.86$ 29.76

Net income per share .............................................................................

561.36511.90

4.61

Diluted net income per share ..................................................................

—

—

—

Diluted net income per share for the years ended March 31, 2018 and 2019 were not presented because the Company had no shares withdilutive effects.

Business Section

2018

Calculation bases for basic net income per share for the years ended March 31, 2018 and 2019 were as follows:
Millions of Yen
2018

Thousands of U.S. Dollars
2019

2019

Net income attributable to owners of parent ........................................

¥

126,788¥

112,572$ 1,014,254

Net income not available to common stock holders ............................

—

—

—

Net income attributable to owners of parent available to common stock ...

126,788

112,572

1,014,254

Average common stock outstanding (in thousands share) ...................

225,859

219,910ESG Section

Basic net income per share

Data Section

The net assets per share and the net income per share are calculated assuming that the consolidation of shares took place at the beginningof the year ended March 31, 2018, because the consolidation of shares, at the ratio of 1 share for 5 shares, was implemented on October 1,
2017.

TA I SE I A N N UA L R E P O R T 2 0 1 9 104

22. Comprehensive Income
Recycling adjustments and tax effects for each component of other comprehensive income were as follows:
Millions of Yen

Millions of Yen

Thousands of U.S. Dollars

2018

2019

2019

Unrealized holding gains on securities
Amount incurred .................................................................................

¥ 23,537¥ 14,697

Recycling ............................................................................................

(327)

10

90

Before Tax .......................................................................................

23,21014,707

132,507$ 132,417

Tax effect .........................................................................................

(7,098)(4,502)(40,562)

Unrealized holding gains on securities, net of taxes .........................

16,112

10,20591,945

Deferred gains or losses on hedging derivatives
Amount incurred .................................................................................

(10)

23

207

Recycling ............................................................................................

0

(12)

(108)

Before Tax .......................................................................................

(10)

11

99

Tax effect .........................................................................................

3

(3)

(27)

Unrealized gains or losses on hedging derivatives, net of taxes .......

(7)

8

72

(2,216)

Foreign currency translation adjustments
Amount incurred .................................................................................

(45)

(246)

Recycling ............................................................................................

15

7

63

Foreign currency translation adjustments .........................................

(30)

(239)

(2,153)(38,040)

Remeasurements of defined benefit plans
Amount incurred .................................................................................

5,386(4,222)

Recycling ............................................................................................

2,951

(613)

(5,523)

Before Tax .......................................................................................

8,337(4,835)(43,563)

Tax effect .........................................................................................

(2,543)

1,484

13,371Remeasurements of defined benefit plans, net of taxes ...................

5,794(3,351)(30,192)

Share of other comprehensive income of associates accounted for by the equity method
Amount incurred .................................................................................

(1)

(35)

(315)

Total other comprehensive income ................................

¥ 21,868¥ 6,588$ 59,357

105 TA I S E I A NNUA L R EPORT 2019

Notes to Consolidated Financial Statements (cont.)① Reason of acquisition of treasury stock
The Company decided to acquire its treasury stock in order to enhance the shareholders’ value per share and to improve the capitalefficiency.

Data Section

ESG Section

Business Section

Special Feature② Details(a) Type of stock to be acquired: Common stock of the Company(b) Number of stocks to be acquired: Up to 8,300,000 stocks (3.81% of the total outstanding stocks excluding treasury stock)(c) Total cost of acquisition: Up to ¥ 28,000 million ($ 252,275 thousand)(d) Period of acquisition: From May 13, 2019 to September 30, 2019

Toward Sustainable Growth of the Taisei Group

23. Subsequent Event(1) Acquisition of treasury stock
The Company resolved the item related to the acquisition of treasury stock at the board of directors held on May 10, 2019, in accordancewith the article 156 of the Japanese Corporate Law (the “Law”), which is applicable as replacement of the article 165, paragraph 3 of thelaw, as detailed below.

About the Taisei GroupTAISEI CORPORATION and Consolidated Subsidiaries
Years Ended March 31, 2018 and 2019

TA I SE I A N N UA L R E P O R T 2 0 1 9 106

Independent Auditor’s Report

107 TA I S E I A NNUA L R EPORT 2019

Data Section
ESG Data of the Taisei Group

Ensuring quality andimproving technology

Technical development forrealizing a sustainable
society

Promotion of supply chain
management

Taisei Corporation

Taisei Group*2
Taisei Corporation

Suppliers*3

Taisei Group*2
Taisei Corporation

Cultivation of technical staff
and securing humanresources

360 103t-CO2

At construction stage: CO2 emissions per construction cost (intensity)*8

23.3 %

28.4 %

28.9 %

At construction stage: Total CO2 emissions*8

51.9 %

48.4 %

44.7 %

At building operation stage: Design-build estimated CO2 emissions*8*9

38.9 %

48.1 %

40.2 %

Promotion of recycling construction waste: Final disposal rate

3.5 %

3.2 %

3.4 %

Implementation of proposals that consider biodiversity: Number of proposals

42 cases

52 cases

35 casesZero environmental accidents (Implementation of management procedure
based on“Operation Manual for Priority Environmental Issues”)

0 cases

0 cases

0 casesCustomer satisfaction (Civil Engineering)

80

95

%

96 %

Customer satisfaction (Construction)

90 %

90 %

92 %

Productivity (Net sales/number of employees working at construction
sites)*10

100

107

111

Number of patent applications filed

311 cases

253 cases

226 cases

Number of patent applications filed

304 cases

235 cases

213 cases

Number of patent rights registered

232 cases

191 cases

250 cases

Implementation rate of companies where CSR activity survey was
conducted*11

62.6 %

Number of companies responding

63.5 %

79.3 %

Number of companies surveyed

523 companies

1,060 companies

S

Health exam participation rate

100 %

100 %

100 %

100 %

100 %

Frequency Rates*12

0.53

0.44

0.58

Frequency Rates*12

0.47

0.41

0.42

Number of fatal accidents*12

1 case2 cases

2 cases38.4 hours

37.5 hours

37.8 hours

Number of female engineers

584 persons

621 persons

663 persons

Rate of attendance at human rights training

93.8 %

98.2 %

96.8 %

Rate of employment of handicapped persons

2.05 %

2.07 %

2.33 %

Number of re-employed

663 persons

663 persons

739 persons

Number of former employee's registered with the Job-Return system*14

15 persons

1 persons

2 persons

Number of female managers

62 persons

83 persons

167 persons

Rate of taking childcare leave by males

1.7 %Rate of return to work after childcare leave

4 persons100 %2 persons

Numbers taking nursing care leave
Taisei Corporation

93.8 %

94.2 %

243 persons

244 persons

97.5 %

100 %3 persons37.3 %

42.9 %

47.5 %

Rate of milestone leave utilization

93.6 %

97.8 %

94.0 %

Rate of refresh leave utilization

89.1 %

89.1 %

92.2 %

80.6 %

Turnover rate of employees within three years of hiring*16

5.0 %

4.3 %

5.4 %

Training hours per person

44.7 hours

32.8 hours

36.6 hours
38.8 hours

Training hours per person for new employees
Number of employee's who participated in overseas training system

10 persons

14 persons

22 persons

Implementation rate of career development review

73.1 %

87.8 %

87.7 %

Non-regular employee promotion rate

11.9 %

11.7 %

12.2 %

Number of employees promoted from non-regular employees to regular
employees

251 persons

Taisei Group*4

Rate of participation in the large-scale disaster drill

100 %Taisei Group*5"Corporate ethics helpline" and "Group helpline" response rate

Taisei Corporation

Promotion of compliance

0 personsRate of paid leave utilization

Employee satisfaction surveys for union members*15

G

100 %

Construction career up system worksite registration rate*13

Numbers taking leave for childcare (male)

Realization of an attractive
working environment thatis good to work in

74.2 %

Labor union participation rate

Average overtime hours per month
Taisei Corporation%

Suppliers*6

100 %Compliance training participation rate

42 persons

45 persons

100 %

100 %

100 %

100 %

100 %

100 %

Number of compliance training sessions conducted for new employee's of
Soyukai member companies

1 time2 times

2 timesNumber of training regarding intellectual property rights

22 times

17 times

19 times

Taisei Group*7

Number of times education in information security implemented in allcompanies

16 times

15 times

19 times

Taisei Group*7

Number of major information security accidents*17

0 cases

0 cases

0 cases

Taisei Corporation*1 Refers to Taisei Corporation and the seven major Group companies.
*2 Refers to Taisei Corporation and the six major Group companies.
*3 Refers to our primary suppliers centered on Soyukai (an association of our core subcontractors).
*4 Refers to Taisei Corporation and the 25 major Group companies.
*5 Refers to Taisei Corporation and the 21 major Group companies.
*6 Refers to our primary supplier, Soyukai (an association of our core subcontractors).
*7 Refers to Taisei Corporation and the eight major Group companies.
*8 Base years for CO2 emissions targets: FY1990*9 Including dissemination and promotion of ZEB

About the Taisei Group

Taisei Corporation

Taisei Corporation

Thorough management oflabor safety and sanitaryconditions

2018

340 103t-CO2

Toward Sustainable Growth of the Taisei Group

E

2017

332 103t-CO2

Key Indicators

Special Feature

Taisei Group*1

Realization of a sustainable
and environmentally friendly
society

2016

Total CO2 Emissions

Scope of report*10 The actual result for FY2016 is set at 100. 110 is the target for the end of FY2020.
*11 No questionnaire survey for subcontractors will be conducted in FY2019 (biennial implementation)*12 Actual results from January to December in 2016, 2017, and 2018.
*13 The ratio of total net sales of registered worksites against the total net sales. The target set for
September 2019 is 60% or more. The system went into full-scale operation from April 2019.
*14 A system to rehire retired employees at their own request.
*15 No surveys were conducted in FY2016 and FY2018 due to biennial implementation.
*16 Refers to new graduates in general and expert positions.
*17 Number of major security breaches of electronic information related to the Taisei Group.

ESG Section

Materialities

Data Section

ESG

(FY)

Business Section

KPIs (Key Performance Indicators)

TA I SE I A N N UA L R E P O R T 2 0 1 9 108

Data Section
ESG Data of Major Group Companies
TAISEI ROTEC CORPORATION (Pavement and civil engineering)
ESG

ISO26000(FY)CSR Issues

Key Indicators

Unit

2016

2017

2018

Realization of a sustainable and environmentally friendly
society

Number of times training for prevention of industrial waste
accidents was implemented
Ratio of achievement of target score in construction evaluation(number achieved / total number)

Times

9

9

30

%

42.8

72.7

77.8
86.4

E

The Environment
Consumer Issues

Ensuring quality and improving technology

S

Human Rights /Labor Practices

Realization of an attractive working environment that isgood to work in

Rate of taking refreshment leave

%

89.5

62.5

Labor Practice s

Thorough management of labor safety and sanitary conditions

Frequency rates*1

—

0.81

0.42

1.0

Compliance training participation rate*2

%

100

100

100

Participation rate for e-learning on compliance

%

100

100

100

CSR newsletters issuance rate

%

—

—

100

G

Fair Operating Practices

Promotion of compliance

Taisei-Yuraku Real Estate Co., Ltd. (Real estate development, facility management, etc.)
ESG

ISO26000CSR Issues

Key Indicators

Unit

2016

2017

Rate of reduction of electrical power usage (office)*3
Number of projects proposing improvement in energy efficiency at
customers' facilities

%

8.2

5.2

9.3

Cases

81

190

158

Participation rate of training*4

%

99.8

100

100

E

The Environment

Realization of a sustainable and environmentally friendly
societyS

Human Rights /Labor Practices

Realization of an attractive working environment that isgood to work in

G

(FY)

Organization GovernanceRisk management

Fair Operating Practices

Promotion of compliance

Rate of participation in the Large-Scale Disaster Drill

%

100

100

100

Participation rate for e-learning on compliance

%

100

100

100

Rate of implementation of information security measures

%

100

100

100

Unit

2016

2017

2018

Rate of recycling of construction waste

%

95.9

97.1

97.9

Rate of use of Electronic Manifest System

%

99.6

100

99.8

Cases

0

1

0
0.28

TAISEI U-LEC CO., LTD. (Planning, design, and construction of housing complexes)
ESG

E
S
G

ISO26000
The Environment

CSR Issues
Realization of a sustainable and environmentally friendly
society

Labor Practice s

Thorough management of labor safety and sanitary conditions

Consumer Issues

Ensuring quality and improving technology

Fair Operating Practices Promotion of compliance

Key Indicators

Number of fatal accidents(FY)

Frequency rates*

—

0.6

0.59

Rate of return of customer questionnaires

%

72

88

65

Compliance training participation rate

%

100

100

100

1

TAISEI SETSUBI CO., LTD. (Air conditioning, sanitation, electrical equipment, and interior finishing) 
ESG

E
S
G

ISO26000CSR Issues

The Environment

Realization of a sustainable and environmentally friendly
society

Human Rights /Labor Practices

Realization of an attractive working environment that isgood to work inLabor Practice s

Thorough management of labor safety and sanitary conditions

Fair Operating Practices Promotion of compliance

Key Indicators

(FY)

Unit

2016

2017

Percentage of energy efficiency proposals to customers

%

56.2

100

100

Attendance rate of environmental education

%

82.4

92.5

90.1

Number of productivity improvement activities

ISO26000

12

12

Cases

—

Frequency rates*

—

0.56

0

0.75

Compliance training participation rate

%

100

100

100

Cases

0

0

0

Number of major information security accidents

CSR Issues

Key Indicators

(FY)

Unit

2016

2017

Persons

20

17

15

Rate of use of Electronic Manifest System

%

99.4

99.7

99.9

Number participation in social responsibility activities

%

11.5

12

12.7

Customer satisfaction surveys (promoter survey)

%

97

94

93

Organization Governance Risk management

Rate of participation in the Large-Scale Disaster Drill

%

100

100

100

Fair Operating Practices Promotion of compliance

Compliance training participation rate

%

100

100

100

Number participation in social responsibility activitiesE

The Environment

Realization of a sustainable and environmentally friendly
societyS

Consumer Issues

Ensuring quality and improving technology

G

SEIWA RENEWAL WORKS CO., LTD. (Civil engineering, renewal work, production and sales of construction machinery, etc.)
ESG

E
S
G

2018

1

TAISEI HOUSING CORPORATION (Design, construction, and sales of order-made individual housing) 
ESG

2018

ISO26000CSR Issues

Key Indicators

2018

(FY)

Unit

2016

2017

2018

The Environment

Development and providing technologies to solve social issues

Number of technical proposals submitted

Cases

10

6

12

Human Rights /Labor Practices

Realization of an attractive working environment that isgood to work in

Number of taking nursing leave and caregiving leave

Persons

4

4

6

Labor Practice s

Thorough management of labor safety and sanitary conditions

Number of labor accidents (four or more days off work)*2

Cases

2

1

2

Organization Governance Risk management

Rate of participation in the Large-Scale Disaster Drill

%

100

100

100

Fair Operating Practices Promotion of compliance

Compliance training participation rate

%

100

100

100

*1Actual results from January to December in 2016, 2017, and 2018.
*2Group compliance training sessions include those related to the Anti-Monopoly Act.
*3FY2013 is used as the base year until FY2016, and FY2015 is used as the base year from FY2017 onward.
*4 In-house training sessions include those on human rights and diversity.

109 TA I S E I A NNUA L R EPORT 2019

About the Taisei Group

Third-Party Opinion

Introduction
This report is the second issue in a new “integrated report” format
that the Taisei Group introduced in the last year for its annual CSR

improved, and they are pointed out below.

Kanji Tanimoto
Professor,
Ph. D. in Business Administration
School of Commerce,
Faculty of Commerce,
Waseda University

Issues
It is vital that the integrated report presents (or describes) how theinstitutions) cannot know how and how far the Company will beGroup, considering material challenges/issues posed in CSR orcommitted to the issue. (Note that the “Fundamental Corporate

ESG activities, achieves financial targets specified in the Medium-

Governance Policy” is well articulated, and that the report also goesterm Business Plan and connects its diverse business lines to theinto the details of the “Fundamental Policy to Enhance Operational

value creation process. It is important to show a story of theCompliance Systems” but the reason for its disclosure is left out.)

Group’s corporate value enhancement through its social

The website outlines a variety of policies as the “corporate policies,”

contribution businesses to relevant stakeholders including

but they would be clearer for readers (more reader-friendly) if theinvestors, in an easy-to-understand manner.

policies, standards, and rules were disclosed appropriately by item,

In my previous year’s third-party opinion, I suggested a few
more pages be devoted to a discussion of the outcomes ofalong with the current status of actions and challenges/issues (inconjunction with the website).

specific initiatives implemented during the year and plans of further

This year the report covers the summary of the CSR

efforts for the future. This year’s report explains key management

Procurement Guideline, while many manufacturers and otherissues in the Medium-term Business Plan by illustrating specificcompanies disclose the details of procurement standards. Having

actions taken and related ongoing business activities. A list of key

engaged in research and enlightenment activities targeted at the

KPIs (including Group companies’ ones) covering financial data as“Souyu-kai” members since 2013, Taisei Corporation increases

well as ESG data is added in the Data Section, which also helps

the number of targets further to a total of more than 1,000

readers understand matters more easily. In the Talk and Dialogue

customers for in-depth research. As a third party, I check thefeatures, the investors’ take on and expectations for Taisei

results of the research in detail on a yearly basis; it is also vital that

Corporation and the mindset and activities of the work sites are

the Company publicly discloses the summary of these results, tofocused on, and they hopefully will be regarded not merely as a

the extent possible, to show its strengths and challenges/issues tostand-alone topic but as part of the whole context of the report.

be addressed in the future.

Special Feature

Sustainable Growth.” But I also notice some parts could be further

Business Section

information more simply and clearly, such as the part “Toward

Toward Sustainable Growth of the Taisei Group

reporting. Compared to last year’s, this year’s report provides

The suspicion of bid-rigging in connection with the Linear
Chuo Shinkansen Project, which transpired in the previous fiscal

Going Forward

previous year is outlined. After an in-depth discussion of this issue
by its Compliance Committee and Board in the previous year, theThe overseas business is one of Taisei Corporation’s crucial

Company has already enforced the revised and tightened versions

management issues, and the development of human resourcesof the “Code of Conduct for Compliance with the Anti-Monopoly

who drive its globalization is also a pressing matter to attend to.

Act” and the “Detailed Rules for the Process of Ensuring

In an age of sustainability revolution, the development of talented

Legitimacy of Bids.” It is best to disclose these arrangements assustainability people who are capable of making efforts with amuch as possible. The disclosure of these rules should help the

triple bottom line (environmental, social, and financial) mindset is inCompany define its own stance/principle.

urgent need. The Company must recruit/collect and cultivate

In association with this issue, the “Fundamental Policies” on risk

young talent with a global mindset and a sustainability mindset all

management, information disclosure, and human rights, fortogether—they will be tackling management issues in the future.

instance, are posted on the website, whereas the details of specific

One of the important themes to this end should be how tostandards and rules are not clear due to the simplified description.

promote the creation of attractive workplaces and organizations

Without (proper) disclosure, outside parties (including evaluationthat are open to a diverse range of people.

Data Section

well as in the compliance section, where how it was handled in the

ESG Section

year, is mentioned again this year in the President’s Message as

TA I SE I A N N UA L R E P O R T 2 0 1 9 110

Outline of the Company

Corporate Data (As of March 31, 2019)
Name
Established
Paid-in capital
Number of
employees
Representative
Head office

TAISEI CORPORATION
December 28, 1917
¥122.7 billion

Domestic Network

8,490 people (non-consolidated)
Yoshiyuki Murata,
President and Chief Executive Officer
25-1, Nishi-Shinjuku 1-chome,
Shinjuku-ku, Tokyo, Japan
TEL. 81-3-3348-1111 (main number)

SapporoTohoku (Sendai)
Hokushinetsu (Niigata)
Kanto (Saitama)

Head Office
TokyoInternational Operations
Headquarters (Shinjuku, Tokyo)

Nagoya
Kyoto
Kobe

Chiba

Tokyo, Osaka, Nagoya, Fukuoka,
Sapporo, Sendai, Hiroshima,
Yokohama, Niigata, Takamatsu, Chiba,
Saitama, Kobe, Kyoto

Branches

Yokohama
Technology Center (Yokohama)Kansai (Osaka)

Taisei Technology Center(Yokohama City)

Shikoku (Takamatsu)
Chugoku (Hiroshima)

Overseas Network (As of August 1, 2019)

Kyushu (Fukuoka)

Head Office
Branch Office
Technology Center

CSCEC-TAISEI CONSTRUCTION, LTD.
(Head Office)Beijing

ISTANBULINDIA

PAKISTANNORTH AFRICATAIPEITAISEI MYANMAR CO., LTD
MYANMAR

MIDDLE EASTSRI LANKATAISEI PHILIPPINE CONSTRUCTION INCORPORATEDPHILIPPINEVINATA INTERNATIONAL CO., LTD. VIETNAM (Head Office)
VIETNAM (Hanoi)

KUALA LUMPUR
PT.TAISEI PULAUINTANCONSTRUCTION INTERNATIONAL
JAKARTA

VINATA INTERNATIONAL CO., LTD. VIETNAM(Hochiminh City Branch Office)
VIETNAM (Hochiminh City)

PT. INDOTAISEIINDAH DEVELOPMENT

TAISEI (THAILAND) CO., LTD
THAILANDSINGAPORE

Share Information (As of March 31, 2019)
Major Shareholders (Top 10):

Status of Shares
Number of Shares Authorized
Number of Shares Issued
Number of Shareholders

440,000,000
224,541,172
72,265

Name of Shareholder

Number of Shareholders:
Financial Institutions
72,413 thousand shares(32.25%)

Individuals and Others
55,908 thousand shares(24.90%)Shareholder
Composition
Foreign Corporations etc.
72,685 thousand shares(32.37%)

Stock Listings
Code
Transfer Agent

Securities Companies
7,123 thousand shares(3.17%)
Other Japanese Corporations
16,411 thousand shares(7.31%)

Tokyo, Nagoya
1801
Mizuho Trust & Banking Co., Ltd.
1-2-1, Yaesu, Chuo-ku,
Tokyo 103-8670, Japan111 TA I S E I A NNUA L R EPORT 2019

The Master Trust Bank of Japan, Ltd.
(Trust Account)
Japan Trustee Services Bank, Ltd.
(Trust Account)
Retirement Benefit Trust in Mizuho Trust(Mizuho Bank, Ltd. Account)
Taisei Associates’ Shareholding Plan
Japan Trustee Services Bank, Ltd.
(Trust Account No.7)
Japan Trustee Services Bank, Ltd.
(Trust Account No.5)
Taisei Employees’ Shareholding Plan
State Street Bank West Client-Treaty 505234
JPMorgan Chase Bank, N.A., 385151
Japan Trustee Services Bank, Ltd.
(Trust Account No.9)

Number of Shares
Held(Unit: Thousand
Shares)Ratio of
Shares Held(%)

15,843

7.26

13,156

6.03

7,857
5,272

3.60
2.42

4,549

2.09

4,376
3,578
3,412
3,250

2.01
1.64
1.56
1.49

3,022

1.39

Note: The Company’s own shares (6,419,832) are excluded in calculating
the Ratio of Shares Held.

★

Auditing Dept.

Engineering Planning Dept.

Industrial Affairs Dept.

Engineering Solution Dept.
Engineering Div.

Corporate Planning Dept.

Life-science Project Dept.

Information Planning Dept.

Industrial Facilities Project Dept.

Human Resources Dept.

Project Management Dept.

General Affairs Dept.

Technology Strategy Dept.

Legal Dept.
Accounting Dept.

International Projects Management Dept.

Finance Dept.

Productivity Promotion Dept.

Safety Administration Dept.
Safety Administration Div.

Power Plant Construction Planning Dept.

Subcontractor Relations Dept.

Building Construction Dept.

Environmental Administration Dept.

Environmental Technology Innovation Dept.

Environment Div.

Natural Symbiosis Engineering Dept.
Geo-Environmental Technology Dept.
Technology Planning Dept.
Intellectual Property Dept.
Urban Engineering Research Dept.

Taisei Technology Center

Architecture & Engineering Div.(Integrated)

Planning & Administration Dept.

Building Construction Div.

Estimate Dept.
Mechanical & Electrical Div.

Energy Div.

Administration Dept.
Architectural Design Depts.
Structural Engineering Depts.
Structural Planning Dept.
M&E Engineering Depts.
Design Div.

Planning & Design Dept.

Planning Dept.

Quality Management & Technology Dept.

Energy Projects Promotion Dept.

Construction Administration Dept.

ZEB & Smart Community Dept.

International Projects Dept.

Thermal Power & Next Generation Energy Dept.

Nuclear Facilities Dept.

Renewable Energy Dept.

Specific Project Dept.
Strategy Dept.
Civil Engineering Dept.

President

Structural Engineering Dept.

Construction Engineering Dept.

Advanced Analysis Technology Dept.
Civil Engineering Dept.

Civil Engineering Div.

Environmental Engineering Dept.

Marketing & Sales Promotion Div.

M&E Planning Dept.

Production Engineering Technology Dept.

Planning Dept.
Nuclear Facilities Div.

Mechanical & Electrical Dept.
Operations Planning Dept.

Infrastructure Technology Research Dept.
Advanced Technology Development Dept.

Technology Control Dept.

Machinery Dept.
Design Dept.
Estimate Dept.

Marketing & Sales Promotion Dept.

Project Analysis & Information Dept.

Planning & Business Promotion Dept.

International Projects Management Dept.

Real Estate Information Dept.
Coordination & Analysis Dept.

Customer Satisfaction Dept.
Project Solutions Dept.
Business Design & Master Plan Consulting Dept.

Proposal & Solutions Div.

Toward Sustainable Growth of the Taisei Group

Business Administration Div.

Life-science Proposal Dept.

Corporate Communication Dept.

Special Feature

Corporate Planning Office

Procurement Dept.Ⅰ
Procurement Div.

Procurement Dept.Ⅱ
Procurement Dept.Ⅲ

Projects Information Analysis & Strategy Dept.

Business Section

Secretarial Dept.

About the Taisei GroupTAISEI CORPORATION Organization Chart (As of July 1, 2019)

Planning & Administration Dept.

Life Cycle Care Promotion Dept.

Marketing & Sales Depts.

Marketing & Sales (Building Construction) Div.Ⅱ

Marketing & Sales Depts.

Marketing & Sales (Building Construction) Div. Ⅲ

Marketing & Sales Depts.

Medical & Pharmaceutical Business Div.

Administration Dept.
Safety Administration & Environmental Dept.

Marketing & Sales Depts.
Marketing & Planning Dept.

BranchMarketing & Sales Depts.
Building Construction Dept.

Planning & Management Dept.

Design Dept.

Project Development Dept.Ⅰ

Civil Engineering Dept.

ESG Section

Marketing & Sales Div.(Integrated)

AI & IoT Business Promotion Dept.
Marketing & Sales (Building Construction) Div.Ⅰ

Project Development Dept.Ⅱ
PPP Projects Dept.
Urban Redevelopment Dept.Ⅰ

International Business Strategy Dept.

Urban Redevelopment Dept.Ⅱ
Development Business Dept.
Development Business Dept.(International)
Property Management Business Dept.
Marketing & Sales (Civil Engineering)Div.

Marketing & Sales Depts.
Planning & Business Promotion Dept.

Marketing & Sales (West Japan) Div.

Marketing & Sales Depts.

Administration Dept.
International Operations Headquarters

Safety Administration & Environmental Dept.
Building Construction & Engineering Dept.
Civil Engineering Dept.

Data Section

Urban Development Div.

Project Engineering & Promotion Dept.
International Marketing & Business Development Div.

★
Audit & Supervisory Board Member

Marketing & Business Development Depts.
Sales Mindset/Skills Training Dept.

Audit & Supervisory Board Members’ Dept.

TA I SE I A N N UA L R E P O R T 2 0 1 9 112

Overseas Network (As of August 1, 2019)

Overseas Business Offices

Overseas Subsidiaries / Affiliated Companies

TAIPEI OFFICE Zone B, 6F, No. 16, Sec. 4, Nan-Jing E. Road,
Taipei, Taiwan R. O. C.
TEL. 886-2-2578-5656 FAX. 886-2-2578-3300

PT.TAISEI PULAUINTAN CONSTRUCTION INTERNATIONALPLAZA OLEOS 18th Floor JI. TB Simatupang No.53, Pasar
Minggu Jakarta Selatan, 12520, Indonesia
TEL. 62-21-2278-3906 FAX. 62-21-2278-3903

MIDDLE EAST OFFICE (Doha) Corner Abdullah Bin Jassim St.
United Bank Bldg. 4th Floor, Facing QNB Bldg, Doha - Qatar, PO
BOX 47366
TEL. 974-4443-4174 FAX. 974-4443-7176
SINGAPORE OFFICE 16 Collyer Quay, Level 21, Singapore,
049318TEL. 65-6818-9779
KUALA LUMPUR OFFICE 9-3, 9th Floor, Faber Imperial Court,
Jalan Sultan Ismail, 50250 Kuala Lumpur, MALAYSIA
TEL. 60-3-2070-6155 FAX. 60-3-2070-6010
JAKARTA OFFICE PLAZA OLEOS 18th Floor JI. TB Simatupang
No.53, Pasar Minggu Jakarta Selatan, 12520, Indonesia
TEL. 62-21-2278-3902 FAX. 62-21-2278-3903
INDIA OFFICE #602, 6th Floor, Tower B, Global Business Park,
M.G. Road, Gurgaon, Haryana-122002, India
TEL. 91-124-466-9800 FAX. 91-124-466-9888
PAKISTAN OFFICE Office-A, 5th Floor, Block-A, Saudi Pak
Tower, 61-A, Jinnah Ave., Islamabad, Pakistan
TEL. 92-51-8316620 FAX. 92-51-8316629
VIETNAM OFFICE (Hanoi) 2nd Floor,Block A,Song Da Building
Pham Hung Road,My Dinh1,Nam Tu Liem District Hanoi,
S.R.VIETNAM
TEL. 84-24-3553-5033 FAX. 84-24-3553-5002
VIETNAM OFFICE (Hochiminh City) VIETNAM CHAMBER OFCOMMERCE AND INDUSTRY, Hochiminh City Branch Building
7th FL, 171 Vo Thi Sau St., Ward7, District-3, Hochiminh City,
S.R.VIETNAM
TEL. 84-28-3932-1759 FAX. 84-28-3932-1758
THAILAND OFFICE 19th Floor, Thanapoom Tower, 1550 New
Petchburi Road, Kwaeng Makkasan, Khet Rachtavee, Bangkok
10400, THAILAND
TEL. 66-2-207-0331
PHILIPPINE OFFICE 9th Floor, BDO Equitable Tower, Paseo deRoxas, Salcedo Village, Makati City, PHILIPPINES
TEL. 63-2-403-9105 FAX. 63-2-478-9542
MYANMAR OFFICE 2nd Floor, Tokyo Enterprise Building, No.32,
Pyay Road, 61/2 miles, Hlaing Township, Yangon, Myanmar
TEL./FAX. 95-1-654-838
SRI LANKA OFFICE No.177, 3rd Floor, Galle Road, Colombo
03, Sri Lanka
TEL. 94-11-2446194 FAX. 94-11-2446198
NORTH AFRICA OFFICE 25th, Rd. No.10, Station Sqr, Maadi,
Cairo, ARAB REPUBLIC OF EGYPTTEL. 20-2-2378-3609 FAX. 20-2-2380-1362
ISTANBUL OFFICE Barbaros Mah. Seyit Ahmet Deresi Sok.
Bahar Sitesi Yani, 34662 Altunizade - Uskudar Istanbul, TURKEY
TEL. 90-216-651-8160 FAX. 90-216-651-8180

113 TA I S E I A NNUA L R EPORT 2019TAISEI (THAILAND) CO., LTD. 9th Floor, Thanapoom Tower,
1550 New Petchburi Road, Kwaeng Makkasan, Khet Rachtavee,
Bangkok 10400, THAILAND
TEL. 66-2-207-0330 FAX. 66-2-207-0332
VINATA INTERNATIONAL CO., LTD. (Head Office)3rd Floor,Block C,Song Da Building Pham Hung Road,My
Dinh1,Nam Tu Liem District Hanoi, S.R. VIETNAM
TEL. 84-24-3553-3839, -3840 FAX. 84-24-3553-3788(Hochiminh City Branch Office) 7th FL, VIETNAM CHAMBER
OF COMMERCE AND INDUSTRY TOWER,171 Vo Thi Sau St.,
District3, Hochiminh City, S.R.VIETNAM
TEL. 84-28-3932-1765 FAX. 84-28-3932-1764
CSCEC-TAISEI CONSTRUCTION, LTD. (Head Office)4th Floor, Building No. 8, Foreign Culture Creativity Park, 19
Chegongzhuang Xi Road, Haidian District, BEIJING, P.R.C.
100048TEL. 86-10-6845-1267 FAX. 86-10-6845-1266
TAISEI PHILIPPINE CONSTRUCTION INCORPORATED 23rd
Floor, BDO Equitable Bank Tower, Paseo de Roxas, Salcedo
Village, Makati City, PHILIPPINES
TEL. 63-2-886-0670 FAX. 63-2-886-0663
PT. INDOTAISEI INDAH DEVELOPMENT
Kawasan Industri Indotaisei, Kota Bukit Indah Sector IA, Block B
Karihurip, Cikampek, Karawan, Jawa Barat, INDONESIATEL. 62-264-351-003 FAX. 62-264-351-026
TAISEI MYANMAR CO., LTD. 2nd Floor Tokyo Enterprise
Building, No.32, Pyay Road, 61/2 miles, Hlaing Township, Yangon,
Myanmar
TEL. 95-1-654-838 FAX. 95-1-654-838

[ On the Cover ]The geometric pattern represents
the increasingly complex and diverse roles
we will play in the years ahead.
In addition, the area of water wherelight shines represents the moment
when innovation takes place.

［ I n q u i r i es ］

TAISEI CORPORATIONCSR Promotion Section,
Corporate Communication Department,
Corporate Planning Office
URL : https://www.taisei.co.jp/english/

1909.1600.T.S