Top Message

KDDI’s Commitment to Sustainability

Contents

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Top Message… …………………………………………………………………………………………………………… 2
KDDI’s Commitment to SustainabilityKDDI’s Commitment to Sustainability … ………………………………………………………………………………… 4

The KDDI Group Mission Statement

Sustainability Promotion Framework……………………………………………………………………………………… 6
Our Business and Strategies… …………………………………………………………………………………………… 8

The KDDI Group values and cares about the material
and emotional well-being of all its employees,
and delivers a thrilling customer experienceby always going further than expected with the ultimate goalof achieving a truly connected society.

Feature Article

KDDI Sustainable Action

Connecting and Protecting Lives

Building a Resilient Infrastructure for Communication and Disaster Response ………………………………… 14
Conserving the Environment… ………………………………………………………………………………………… 16
Connecting Day-to-day Lives

Sustainable Development for Cities and Communities ……………………………………………………………… 18
Building the Infrastructure for Developing Countries………………………………………………………………… 20
Developing Human Resources for the Next Generation……………………………………………………………… 22
Connecting Hearts and Minds
Creating a Digital Society for Affluence and Peace of Mind………………………………………………………… 24
Promotion of Diversity and Inclusion…………………………………………………………………………………… 26
Fostering Health and a Purpose in Life………………………………………………………………………………… 28

Materiality
The KDDI Group Philosophy

Message from Executive Officer of Sustainability… ………………………………………………………………… 30
KDDI’s Material Sustainability Issues…………………………………………………………………………………… 31

Chapter 1

Chapter 4

VisionWay Forward

Connecting people “heart to heart”, bringing smiles from “faceto face”

Be self-motivatedBeing global

Taking ownershipResponsibility extending 24/7 and 365 days a year
Satisfying customers
Delivering a thrilling customer experience by always goingfurther than expected
Keeping aspirations alive
Each one of us makes the KDDI Group what it is
Embracing diversity

Keep your fighting spirit alive
Open and direct communication
Be agile; think and act with a sense of urgency
Let’s unite as a team to achieve our goals
Put yourself in the perspective of your boss
Look at what you do, from the outside in
Tackle a challenge head-on
Always be creative in your work

Chapter 2

Management Principles

Every small effort counts
Go back to the basic principles

Fulfilling our corporate and social responsibilities

To know the problem, go, see and touch

Clearly state the purpose and mission of our business

Playing by the rules

Pursue profit fairly

Tough love at work

Real-time business management
Chapter 3

Professional Mindset

Chapter 5

Formula for SuccessAchievement = Attitude x Effort x Ability
Do the right thing as a human being
Be altruistic
Be grateful to others

We set specific goals with a pure and aspirational mind.

Have an open mind and a humble attitude

Once our targets are set, we will drive ourselves to keep goingwith a strong commitment until we achieve success.

Be positive

Then we will share the fruits of our accomplishments.

•Network Quality Management and Improvement•Disaster Preparedness•Initiatives Outside Japan

2 Cyber Security and Privacy Protection……………………………………………………………………………… 44• Cyber Security and Data Privacy Protection

3 Fulfilled Life Brought through ICTs…………………………………………………………………………………… 48•Regional Revitalization Initiatives•Innovation Management•Responsibility for Products and Services•Initiatives Outside Japan

4 Rewarding Workplaces for Diverse Talents… ……………………………………………………………………… 56•Recruiting and Developing Human Resources•Labor Practices•Human Rights•Youth Education Activities•Compliance•Supply Chain Management

6 An Energy-Efficient, Circular Economy……………………………………………………………………………… 82

Transparent management
Lean and mean management

FY2020 Material KPIs… ………………………………………………………………………………………………… 35

1 Safer and More Resilient Connected World………………………………………………………………………… 36

5 Respect for Human Rights and Fairness in Business …………………………………………………………… 72

Believe in our potential

Maximizing revenues, minimizing expenses

FY2019 Material KPI Results… ………………………………………………………………………………………… 34•Environmental Management•Environmental Performance

Management Framework… …………………………………………………………………………………… 98
Corporate Governance/Risk Management/
Customer Relationship Management/Brand Management

Engagement… …………………………………………………………………………………………………… 114
Stakeholder Engagement/Community Involvement and Development/
External Recognition/External Assurance
Corporate Profile…………………………………………………………………………………………………………… 124
Disclosure Policy…………………………………………………………………………………………………………… 125
Appendix: Comparative Table with GRI Standards… ………………………………………………………………… 126
Appendix: Comparative Table with SASB (Sustainability Accounting Standards Board)… ……………………… 128

KDDI Sustainability Report 20201

Top Message

KDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Top Message

Tomorrow, Together
Working with all our partners, we will create new value
in the 5G era, aiming to grow sustainably with society.
President, KDDI CORPORATIONFirst of all, I would like to express my sincere appreciation to all our

Toward Sustainable Growth

stakeholders for your continuous support.

connecting communication as a lifeline is becoming more and morethat top management and employees should share. Due to the syner-

important. We, as a telecommunications company, have a mission togy effect with our corporate governance system that secures trans-

Since establishment, KDDI has made realizing a truly connected

In our medium-term management plan (April 2019-March 2022) re-protect human life by building a reliable communication infrastructure

parency and fairness, a more solid management system has been es-

society part of the KDDI Group Mission Statement. As a communica-

leased last year, we set contributing to the sustainable growth of soci-that ensures communication service at all times under any circum-

tablished.

tions carrier responsible for essential lifeline infrastructure, we strive to

ety as our company vision. We at KDDI rigorously take on social is-

stances and establishing an early recovery support system. In addi-

When our business growth and contribution to society are inte-

fulfill our mission of maintaining resilient, high-quality telecommunica-

sues in addition to our own expansion and strive to evolve along withtion, we regard not only natural disasters but also large-scale commu-

grated to create a virtuous cycle, KDDI’s growth will be a strength totions, and under the slogan Zutto, Motto, Tsunagu Zo, au (Connect-

society through initiatives for achieving the SDGs.

nication failures as a risk that has a great impact on corporate value.

help society grow.

ing more and always with au), we aim to provide telecommunications
services that are always reliable, no matter what.

To this end, we strive to achieve growth on axes of sustainable

With the belief that providing a stable service 24 hours a day, 365

The KDDI Group works to connect and protect lives, connect day-growth of existing businesses and challenge to new innovation based

days a year under any circumstances leads to maintaining and in-

to-day lives, and connect hearts and minds. Through KDDI Sustainableon our management policy.

creasing our corporate value, KDDI is united in providing our utmost

Action, KDDI will work on solving social issues and aim for sustainable

effort to offer resilient and high-quality telecommunications services

growth with society.

Furthermore, in recent years, movements to address social issues
have gained momentum with the Paris Agreement adopted by

In order to contribute to the sustainable growth of society, KDDI isunder the slogan of “Zutto, Motto, Tsunagu Zo, au (Connecting more

COP21 which is a global framework for climate change, a proposal

advancing sustainability activities centered on six material sustainabili-

and always with au).”from the Task Force on Climate-related Financial Disclosures (TCFD),

ty issues on a group-wide basis. Furthermore, in 2020, KDDI formu-

and Sustainable Development Goals (SDGs) for solving global issues.

lated “KDDI Sustainable Action”-KDDI’s initiatives for the SDGs aimed

The spread of COVID-19 has had an immense impact on the activities

Tomorrow, Together

In Japan as well, in promotion of “Society 5.0 : Co-creating the future

at 2030 with a determination to continue working to solve various so-of industry and society at large around the world. In line with the poli-

We will continue to move forward, together with customers, part-for SDGs”, the use of cutting-edge technology to solve social issues

cial issues through business going forward. In consideration of thecies of KDDI Sustainable Action, we announced KDDI’s Basic Policy

ners, and society at large, sharing a faith in the future as we aim tois being advocated, and the era when previously unattainable newsocial issues and the business sectors KDDI can contribute to as a

toward COVID-19, which is based on five central pillars aimed at,sustainably grow profit and reinforce shareholder returns from a long-values are brought to industries and society is about to arrive.

telecommunications operator, we revised KDDI’s Target SDGs, whichamong other things, contributing to the construction of a resilient so-term perspective.

October 1, 2020 will mark the 20th anniversary of KDDI’s establishment.

were linked with the medium-term management plan (April

cial infrastructure that is resistant to environmental changes by pro-

Under these conditions, in March 2020, we began offering our

2019-March 2022), into eight social fields. We do not view social is-moting digital transformation (DX) for individual and corporate cus-

As we move forward together, I would like to express my sincere ap-

much-anticipated au 5G service in Japan.

sues merely as risks; we also consider them opportunities to leverage

tomers such as telework, online education, and remote medical care.

preciation for your continued support and guidance for the KDDI
Group.

The era of 5G will be a time when telecommunications become

the unique strengths of KDDI. We strive to solve diverse social issues

Going forward, KDDI will rally our group-wide strength as a lifeline

seamlessly integrated with all kinds of physical things. 5G has the po-

while raising profit as a business, such as by providing inexpensive,provider to “connect and protect lives,” “connect day-to-day lives,”

tential to greatly change society, transforming individual lifestyles, val-

high-quality telecommunications services in developing countries andand “connect hearts and minds” so we may continue fulfilling our cor-ues, and ways of doing business. We are thus on the verge of an ex-

spurring regional revitalization using 5G, IoT, and other technologies.

porate mission of supporting the daily lives of our customers and in-

Web Link

Medium-Term Management Plan (FY2019–FY2021)

citing new era. Moreover, the use of 5G/IoT, AI, and big data is

Recently, due to the increasing number of large-scale natural di-

dustry.

Web Link

KDDI Sustainable Action

Web LinkKDDI’s Basic Policy toward COVID-19

expected to solve a wide variety of social issues.

2KDDI Sustainability Report 2020

sasters and impact from the spread of COVID-19, online use hasThis corporate attitude has penetrated into the group as the KDDIbeen accelerating in various areas. The telecommunications’ role ofGroup Philosophy which defines perspectives and code of conduct

KDDI Sustainability Report 20203

Top Message

KDDI’s Commitment to Sustainability

Sustainability Promotion FrameworkKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Our Business and Strategies

KDDI’s Commitment to Sustainability
Sustainability is indispensable to the realization of the KDDI Group Mission
Statement of achieving a truly connected society. To date, we have promoted sustainability by raising awareness of the KDDI Group Philosophy
and the KDDI Code of Business Conduct, strengthening corporate governance, and taking measures to address material sustainability issues. However, under the medium-term management plan (FY2019–FY2021), we reiterate our commitment to contributing to the sustainable growth of society
as part of our overall vision and clarify the SDGs KDDI is focused on.
Through these measures we will contribute to society’s sustainable growth.

The KDDI Group Mission Statement
The KDDI Group values and cares about the material and emotional well-being of all its employees, and delivers a thrilling customer
experience by always going further than expected with the ultimate goal of achieving a truly connected society.
Brand Message

Service users
Explore the extraordinaryCompany Vision

The company the customer can feel closest toContributing to the sustainable growthof society

Shareholders
andInvestors

KDDI Sustainable Action

KDDI Sustainable Action
Our power to make connections will help create a brighter future for all.

The KDDI Group
Mission Statement

Connecting day-to-day lives

Connecting hearts and minds

Building a resilient infrastructure for communication anddisaster response

Sustainable development
for cities
and communities

Creating a digital society
for affluence and peaceof mind

Building resilient communications
infrastructure and speedily initiating
disaster recovery

Resolving global issues
and creating people-friendly
citiesEnvisioning a safe
and secure society in termsof security and privacy

Conserving
the environment

Building the infrastructure
for developing countries

Becoming energy-efficient andachieving zero emissions

The KDDI Group
Philosophy

KDDI Code ofBusiness Conduct

Corporate
GovernanceHelping improve the livelihoods of people
in developing countries through economic
and industrial development upgrading

Partnership

Developing human resources
for the next generation

Improving the educational environment
with ICTs and developing humanresources for the next generation

×Promotion of diversity
and inclusion

Respecting human rights,
promoting diversity and inclusion
in society

Fostering healthand a purpose in life

KDDI Sustainability Report 2020

Stakeholders

Resolving social issues through partnerships

Employees
andTheir Families

1 Safer and more resilient connected world

4 Rewarding workplaces for diverse talents

2 Cyber security and privacy protection

5 Respect for human rights and fairness in business

3 Fulfilled life brought through ICTs

6 An energy-efficient, circular economy

NPO/NGO

Administrative
Organizations/
Industry Groups

Supporting healthy,
fulfilling lives with ICTs

Material Sustainability Issues

4

Local
Communities

Value Creation

Connecting and protecting lives

The sustainable development of society

Medium-Term Management Plan (FY2019–FY2021)

A company that continues to produce
excitement

Business
Partners(suppliers)

KDDI Sustainability Report 20205

Top Message

KDDI’s Commitment to Sustainability

Sustainability Promotion FrameworkKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Our Business and Strategies

Sustainability Promotion Framework
The KDDI Group Philosophy

KDDI Group Philosophy

The KDDI Group Philosophy expresses the attitudes, values, and behavior
that all of all of us -officers and employees- need to exhibit in order toachieve our corporate philosophy. The KDDI identity and KDDI vision that
we must embrace as a telecommunications operator are incorporated
throughout. The KDDI Group Philosophy is the foundation of our sustainability initiatives and is the basic stance KDDI officers and employees must
adopt. By putting the KDDI Group Philosophy into practice, we aim to be
a company admired and trusted by all stakeholders.

Web Link

The KDDI Group Philosophy

KDDI Code of Business Conduct

KDDI Group

PolicyWe established the KDDI Code of Business Conduct in 2003 as a set of
specific guidelines for understanding and practicing the KDDI Group Mission Statement and the Group Philosophy. All of our executives and employees maintain a high sense of ethics and execute their duties in compliance with the KDDI Code of Business Conduct.
We review it according to revisions in laws and regulations and changes in the social landscape. In July 2020, we revised the contents of Respect for Human Rights and Individuality which is the first basic principle in
the KDDI Code of Business Conduct to emphasize the seriousness of harassment and the importance of diversity.
We will continue to promote the KDDI Code of Business Conduct asstandards in the group while considering the characteristics of the business.
Happiness of Our Employees and Vibrancy in the Company
I. Respect for Human Rights and Individuality
II. Conscientious Performance of Duties
III. Respect for Intellectual Properties
Earning our Customers’ Satisfaction and Trust
IV. Provision of Services That Respond to the Trust and Confidenceof Our Customers
V. Promotion of Fair Business Activities
VI. Management of Information to Protect the Confidentialityof Communications and Customers’ Information
Confidence of Our Shareholders and Business Partners
VII. Practice of Open and In-depth Communication
VIII. Prevention of Insider Trading
IX. Appropriate Accounting and Adherence to Agreements

The KDDI Group Philosophy,
Group-wide Efforts

KDDI Group

Activity&
Results

FY2019 results of our actions

KDDI

Corporate Management Committee•KDDI Group Philosophy study sessions

ReportFor divisions’ general managers

4

For departments’ generalmanagers / new group leaders

2/7

For new employees

3Group leaders

For group leaders: 59
Total number of participants: 1,462
Level of clarification: 99.6%, Level of passion: 98.7%

Non-line employees

For non-line employees: 342
Total number of participants: 10,641
Level of clarification: 95.2%
Level of passion: 90.7%

At group companies
in and outside Japan

6 (In Japan: 2, outside Japan: 4)

Sustainability Committee (convenes twice a year)
Chair
Company President

KDDI Code of Business Conduct (Basic Principles)

Development of the Society
X. Environmental Conservation
XI. Rejection of Organized Crime Groups
XII. Contribution to the Development of the International Community

Details of Sustainability Committee
activities•Formulation of sustainability action
policies

Permanent Members•Training for new recruits (for regular employees)“Compliance: basic practices” (100% participation rate)•E-learning (for regular employees)“Insider Trading Regulations”“How to Interact with Business Partners”“Preventing Misrepresentation”“Unconscious Bias”“Power Harassment”•E-mail magazine about the KDDI Code of Business Conduct
For regular and contract employees, temporary staff, and subcontracted
employees
Results: Distributed monthly•Survey about the Business Ethics Helpline
For regular and contract employees, temporary staff, and subcontracted
employees
Period: November 2019-December 2019
Results: 85% awareness of the Business Ethics Helpline•Group companies’ training on governanceFor executives of group companies
Number of participants: 58
Evaluation: Satisfied 100%, Beneficial 100%

Web Link

Sustainability Promotion Framework

General Managers of All Businesses and Corporate Sectors
Executive Director, Corporate Sector
Executive Director, Corporate & Marketing Communications Sector
Executive Director, Technology Sector
Executive Director, Global Consumer Business Sector
Executive Director, Personal Business Sector
Executive Director, Solution Business Sector•Sustainability promotion framework
maintenance•Confirmation of progress on KPIs

SystemWe revised the position of the Sustainability
Committee in February 2019. Under the reorganization, the chair is the company president, and the committee members are thegeneral managers of all the businesses andcorporate sectors, the president of the KDDI
Foundation, and the Audit & Supervisory
Board members. The committee is promoting the SDGs and considers sustainability to
be a pillar of company-wide business strategies. Moreover, the degree of achievement
for promoting sustainability is linked to thebonus of the Executive Officer of Sustainability and all employees.

President, KDDI Foundation Audit & Supervisory Board

Secretariat
Human Rights Subcommittee
Discussions related to promoting human rights based on
the KDDI Group Human Rights Policy (convened as needed)

Executive Officer of Sustainability
Sustainability Department

Example topics:•Prohibition of child labor or forced labor•Prohibition of discrimination in business activities(based on race, sex, faith, nationality, age, sexual orientation, gender identity, etc.)•(Relating to telecommunications business) Protection ofconfidentiality of communications, protection of freedom of
expression, and land purchases related to the constructionof base stations

Serviceusers

Shareholders
andInvestors
Local
Communities

Business Sector
Corporate Sector

Stakeholders

NPO/NGO

Regional Offices in Japan
Environmental Subcommittee
Discussions of matters related to policy and plans for sustainability initiatives and environmental conservation activities(convened twice a year)

Control the sustainable initiatives,
general administration and humanresources respectively in the ten
divided regions of Japan KDDI
executive officers are appointed as
the Senior General Managers ofeach regional office

Green Plan Subcommittee
Monitoring of progress on the KDDI GREEN PLAN 20172030, analysis of the gaps between targets and results, anddiscussions of countermeasures (convened twice a year)

Business
Partners(suppliers)

Employees
and Their
Families

Administrative
Organizations/
Industry
GroupsGroup companies
As of April 1, 2020

▪ Example of Sustainability Activities in the Value Chain
Simple, compact productpacking boxes

Impact of businessactivities on society

Efficientdistribution

Use of resources

Purchasing

Constructionof tribrid base stations

CO2 emissions
from deliveries

Provision of support service tocustomers’ energy-saving efforts

CO2 emissions
from base station
operation

Distribution

Communication support
in developing countries

CO2 emissions
from useof mobile phones

Sales, Construction

Digital divide

Education for children
and older people

Recycling ofmobile phones

Safety risks whenusing mobile phones

Discarding of scarce
resources, such as
rare metals

Use, Operations, Maintenance

Recycling

Infrastructure, human resources, technological development, product development, supply chain management
Installation of energy-saving
equipment, disaster prevention
measures6

KDDI Sustainability Report 2020

Promotion of women’s advancement,
diversity and inclusion, health-focusedmanagement, human resources training

Construction of a high-quality andstable information andtelecommunications foundation

Adoption of universal design

Strengthening of partnerships andsustainable procurement surveys

Major Issues Addressed by the Sustainability Committee in FY2019(convened in August and February)•Setting goals and reporting results for material KPIs
•Examining and approving initiatives for SDGs promotion(including introduction of examples of good practices in Japan and abroad)•Reporting progress on SDGs by all businesses and corporate sectors as well as the KDDI Foundation•Reviewing KDDI’s Target SDGs (formulating and approving KDDI Sustainable Action)•Formulating and approving a draft of FY2020 sustainability promotion planKDDI Sustainability Report 20207

Top Message

KDDI’s Commitment to Sustainability

Sustainability Promotion FrameworkKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Our Business and Strategies

Our Business and Strategies
Overview of the Medium-Term Management Plan (FY2019–FY2021)

KDDI Group

Tomorrow, Together
In addition to realizing the “integration of telecommunications and life design,”
we endeavor to provide solutions to social issues and help achievea truly connected society.

PolicyThe KDDI Group
Mission Statement

The KDDI Group Mission Statement

The KDDI Group values and cares about the material andemotional well-being of all its employees, and delivers athrilling customer experience by always going further than
expected with the ultimate goal of achieving a truly connected society.

Brand Message

KDDI will make further progress in the integration of telecommunications and life design withthe aim of expanding the peripheral businesses around telecommunications, as well as achieve
new value creation in the 5G/IoT era both in Japan and around the globe, and pursue efforts toprovide new experience value that exceeds the expectations of customers.

Philosophy

Philosophy

Tomorrow, Together KDDI
Explore the extraordinary au

Under the new KDDI brand slogan of “Tomorrow, Together” and the new au brand slogan of“Explore the extraordinary,” KDDI will contribute to the development of an affluent communications-oriented society by promoting seven business strategies aimed at achieving the threecomponents of the company vision.

Company Vision

Financial Target

PolicyFY2024 Target
EPS growth

FY2018FY2019–FY2021 Initiatives
Operatingrevenue
growthOperating revenue of life
design domain

FY2021 target¥1.5 trillion

Operating revenue of new
Business Services segment

FY2021 target¥1 trillion

Cost reduction, etc.

Philosophy

1.5 times

FY2024¥100 billion (approx.)

3 years total• Over 40% payout ratio• Flexible share buybacks

Shareholder returns• Cancel all treasury shares*•The company the customer can feel closest to•A company that continues to produce excitement•Contributing to the sustainable growth of society* Except KDDI shares owned by executives’ compensation BIP Trust Account and ESOP Trust AccountSeven Business Strategies

KDDI Group

Smart factories

Autonomous
driving

Remoteoperations

Remotemedical careFree view point
image stadium
views

Partners
Telecommunications

Open innovation

Platform

5G/IoT
platform

7. Sustainability
KDDI formulated KDDI Sustainable Action-KDDI’s initiatives for the SDGs aimed at 2030 with a determination to continue working to solve various social issues through business going forward. We aim to further enhance corporate value and achieve sustainable growth with society by helping to solve social issues through business with partners by connecting and protecting lives, connecting day-to-day lives, andconnecting hearts and minds while using 5G, IoT, and other technologies.
In addition, according to the approach of KDDI Sustainable Action, we formulated KDDI’s Basic Policy toward COVID-19 to respond to increasing impact of COVID-19. (Refer to the following page.)KDDI Sustainable Action
Our power to make connections will help create a brighter future for all.

For individual customers

For corporate customers

Expanding life design services throughsmartphones as a starting point

Building new business models together with customers

Connecting and protecting lives

Connecting day-to-day lives

Connecting hearts and minds

Providing experience value withexcitement to customers

Supporting the driving of DX for customers

Building a resilient infrastructure for communication anddisaster response

Sustainable development
for cities
and communities

Creating a digital society
for affluence and peaceof mind

Building resilient communications
infrastructure and speedily initiating
disaster recovery

Resolving global issues
and creating people-friendly
citiesEnvisioning a safe
and secure society in termsof security and privacy

Creating new experience value through collaboration with partners
al

are
thc

Fina
nc
e

on

Experience
Value

y

Edu

ca

ti

Experience
ValuelRetai s
es
Busin

e rg

Earnings
Model
Transformationnuf
Ind actu
ust ringry

Ma

Customers
Telecommunications

n
tio
rta
po tryns us
Tra Ind

Customers
Telecommunications
En

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Se ustryInd

Operational
Efficiency

tainment

merce
Com

Experience
Value

He

Experience
Value

ter
En

2. Further Expansion of Global Business
For the consumer business, we aim to expand our market in Asia applying
insights and know-how cultivated in our consumer business in Japan tothe consumer business overseas. For the corporate business, we are
striving to further expand our global ICT business by integrating our domestic and overseas operations, centering on KDDI IoT World Architecture and our data center business.

6. Growth as the GroupBy maximizing the company’s assets andsupporting the growth of group companies,
we aim to expand and strengthen thegroup-wide foundation for new growth andmaximize synergies.

▪ The Integration of Telecommunications and Life DesignFarm
Fis ing,
h F Foarm res
ing try,▪ Innovation in 5G

4. The Integration of Telecommunications and Life Design
We aim to achieve sustainable growth in the consumer business by enhancing engagement with customers across the group, maximizing lifetime value (number of customers in the group (group ID) × engagement ×
total ARPA) and breaking new ground in life design fields, especially in thearea that is our business foundation, telecommunications. We aim toachieve sustainable growth with customers in the corporate business by
supporting their digital transformation (DX) and realizing the integration of
telecommunications and life design for corporate clients in Japan andoverseas.

FinancBusin ialess

1. Creating Innovation toward the 5G Era
We will actively roll out 5G services as basic next-generation infrastructure,develop businesses through co-creation with various partners, and promote open innovation that incorporates the innovative ideas and advanced
technologies of start-ups. In this way, we will create new experiential value
and actively utilize 5G services for regional revitalization businesses.

PolicyConstruction
Industry

Creationof NewBusiness

Conserving
the environment

Building the infrastructure
for developing countries

Developing human resources
for the next generation

Promotion of diversity
and inclusion

Fostering healthand a purpose in life

Becoming energy-efficient andachieving zero emissions

Helping improve the livelihoods of people
in developing countries through economic
and industrial development upgrading

Improving the educational environment
with ICTs and developing humanresources for the next generation

Respecting human rights,
promoting diversity and inclusion
in society

Supporting healthy,
fulfilling lives with ICTs

End Users
Experience
Value

Expanding growth businesses centering on telecommunications as a base

3. Utilizing Big Data
We are working to thoroughly understand customers by utilizing data andto maximize experiential value through proposals that customers find
comfortable. In addition, with the rapid spread of networks and digitizationin advance of upcoming 5G/IoT technologies, we are promoting DX of client companies by using big data in various industries.

8

KDDI Sustainability Report 2020

5. Expanding the Finance BusinessElectronic settlement and financial services are becoming increasingly familiar parts of customers’ daily lives due to the central position of smartphones in people’s lives. By offering smartphone-centric financial experiences, we aim to strengthen that engagement and achieve profit growth.

Partnership×

Resolving social issues through partnerships

KDDI Sustainability Report 20209

Top Message

KDDI’s Commitment to Sustainability

Sustainability Promotion FrameworkKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Our Business and Strategies

Our Business and Strategies

KDDI’s Basic Policy toward COVID-19
The impact of the COVID-19 pandemic on society is expected to linger fora long time. Based on the approach of the KDDI Sustainable Action thatwas formulated to lay out our commitment to continuing to work toward
the solution of diverse social issues through our businesses, we will rally
our group-wide strength as a company providing a lifeline which connects
and protects lives, connects day-to-day lives, and connects hearts andminds, thereby satisfying our social mission by examining and implementing initiatives according to the following five policies.
KDDI’s Basic Policy toward COVID-19
1. We ensure the safety of our customers and employees of theCompany and affiliated companies above all else.
2. We continue to respond to the rise in telecommunications
traffic and maintain telecommunications services, which are
the foundation and lifeline of society.
3. We actively collaborate with governments, municipalities, andpublic organizations, etc.
4. We contribute to the construction of a resilient social infrastructure that is resistant to environmental changes by promoting digital transformation (DX) for individual and corporate
customers such as telework, online education, and remote
medical care.
5. We offer customer experiences that can alleviate worries anddifficulties in life and fill the heart.

Web LinkKDDI’s Basic Policy toward COVID-19 (Japanese only)

Reception counter partition(image)KDDI Group
1. We ensure the safety of our customers and employeesof the Company and affiliated companies above all else
(1) In au Shops, in addition to shortened operating hours, thorough measures to prevent the spread of COVID-19 are being taken. For example, partitions have been installed on store reception counters andshops have been equipped with disinfectant and face masks. Moreover, at our customer centers and various support centers, fewer
staff members coming to work in our offices enables safe physicaldistancing for continued customer support by phone or online.
(2) In KDDI, only the employees involved in critical mission come to worksites while other employees basically work from home. We thus continue fulfilling our responsibility of providing important telecommunications services as a telecommunications business operator that is a
designated public corporation. Approximately 90% of our employees
work from home, and we are also implementing measures to preventthe spread of COVID-19 by reducing operations and securing social
distancing by spreading out office spaces and break rooms.

Web Link

Reduced Operating Hours and Measures to Prevent the Spread of
COVID-19 in au Shops in Japan (Japanese only)

Web Link

Icom and KDDI Launched an IP Transceiver Rental Service Free ofCharge (Japanese only)

2. We continue to respond to the rise in telecommunications traffic
and maintain telecommunications services,which are the foundation and lifeline of society(1) As of May 2020, traffic on KDDI’s communication network at peaktimes only grew by 10% compared to before the spread of
COVID-19, and the capacity of our entire network is more than adequate at this point. Compared to before the spread of COVID-19,
both data and voice traffic were on the rise. However, our network is
designed to handle peak traffic even during disasters.
(2) Partly due to the increase of use for telework, traffic increased mainly
for landline communications by approximately 60% from 9 am to 6
pm on weekdays. On the other hand, mobile communication traffic
did not change significantly.
Mobile calls (VoLTE traffic intensity) grew by slightly less than 20% at
the most compared to regular time, which reveals high customer needs
for calling.

Traffic during peak hours(including landline andmobile)10%
maximumincrease“au Hikari” traffic
from 9 am to noon
on weekdays

63%
maximumincrease

Mobile calls(VoLTE traffic intensity
at the busiest time)

15%
maximumincrease

Comparison of traffic between Pre-COVID-19 Spreadin February (February 3 to 23) and April (April 6 to 26)

3. We actively collaborate with governments, municipalities,
and public organizations, etc.
Starting with the provision of location information analysis data to governments and municipalities, KDDI will proactively collaborate with initiatives of governments, municipalities, and other public organizations according to changes in society.
Provision of location information analysis data

Web Link

Provision of the “KDDI Location Analyzer” Location Information Big
Data Analysis Tool to Municipalities across Japan Free of Charge for
Measures against the Spread of COVID-19 (Japanese only)

Web Link

Detailed People Flow Analysis Report with KDDI Location Analyzer
during the Golden Week Holidays (April 29, 2020 to May 6, 2020) in
Major Tourist Destinations across Japan (Japanese only)

Web Link

Chosen as One of Tokyo Prefecture’s COVID-19 Tech Partner Companies (Japanese only)

Responses including extension of payment due date

Web Link

IP transceiver
IP500H

10

KDDI Sustainability Report 2020

Handling of Billing in Consideration of the Growing Impact of
COVID-19 (Japanese only)

Donations

Web Link

Donation to the Central Community Chest of Japan to Support
COVID-19 Measures (Japanese only)

Web Link

Additional Donations to the Central Community Chest of Japan to
Support the COVID-19 Measures (Japanese only)

Web Link

Donation of Supplies to Medical Institutions in Support of COVID-19
Measures (Japanese only)

4. We contribute to the construction of a resilient social infrastructurethat is resistant to environmental changes by promoting digitaltransformation (DX) for individual and corporate customers
such as telework, online education, and remote medical care(1) In the background of increasing needs for online use triggered by the
spread of COVID-19, we, as a company that supports telecommunications infrastructure, will proceed with building an online environment that allows the continuation of social activity under any circumstances and promoting DX for individual and corporate customers.
(2) We will examine various initiatives for building an environment that allows timely and proper provision of online education and remote
medical care.
(3) We will build a multi-purpose event space on the internet to support
diverse economic and cultural activities.
Support for online education, etc.

Web Link

Support for Customers Affected by the Spread of COVID-19—Free au Data
Charge for Student (25-Years-Old or Younger) Customers— (Japanese only)

Web Link

Reducing the Price of Unlimited Data Plans for Students (25-Years-Old or Younger)
in Response to the Increasing Impact from the Spread of COVID-19 (Japanese only)

Web Link

KDDI and Mates Built a Partnership Offering a Home Learning Support Service—In Response to Changes in the Education Environment
Resulting from the Spread of COVID-19, Part of the Online Learning
Support Service Launched Earlier than Planned— (Japanese only)* For each value, the same week of February and April were comparedand the maximum values are used

(3) If online schooling is provided more often in the future, a further
growth in traffic from 9 am to 6 pm on weekdays is expected. In
preparation for further traffic increases, we will work together tomaintain a stable telecommunications environment while continuously securing the safety of our employees and staff members of affiliated companies.

PolicyWeb Link

Support for the English Learning of 10,000 High School Students
Who Find Studying Difficult due to School Closures Caused by the
Spread of COVID-19 (Japanese only)

Web Link

Provision of Assets including Facilities and Technical Data by 46
Companies of the KDDI ∞ Labo Partners Association to Assist Startups Facing Challenges due to COVID-19 (Japanese only)

Web Link

Maximum 500 Million Yen in Financial Support to Business Operators
Affected by the Spread of COVID-19 beyond the Industry Mainly
through Crowdfunding (Japanese only)“KDDI Location Analyzer” Location Information Big Data Analysis Tool

5. We offer customer experiences that can alleviate worries
and difficulties in life and fill the heart
While people are spending more time at home, we have implemented
various measures to assist with providing a more comfortable and fulfilling time for our customers including live streaming of entertainment
contents and campaign promotions offering better deals with cashless
payment.
Offering contents and entertainment service free of charge

Web Link

Limited-Time Offer of Book Pass Unlimited Reading Plan Free ofCharge (Japanese only)KDDI Group promotes the integration of telecommunications and life design, and as a company contributing to the sustainable growth of society,we will connect people, companies, and society and provide experiencevalue with excitement to customers together with our diverse partners into
the future.

KDDI Sustainability Report 202011

Top Message

KDDI’s Commitment to Sustainability

KDDI Sustainable Action

Connecting
Day-to-day
LivesKDDI’s Three Types of “Connecting”

KDDI has solved not only is-KDDI’s work of connecting is moresues in cities and communi-

Feature Article

ties but also issues in devel-

than just connecting distant locations

oping countries by using newwith communication lines.

technologies and connecting

We connect much larger things—

partners.

people’s lives, day—to—day lives,

Furthermore, we are able toand hearts and minds.

contribute to future genera-

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Sustainable
Development
for Cities
and Communities

Building
the Infrastructure
for Developing
Countries

Developing Human
Resources
for the Next
Generation

page 18

page 20

page 22

Creating a DigitalSociety
for Affluenceand Peace of Mind

Promotionof Diversity
and Inclusion

Fostering Healthand a Purposein Lifepage 24

page 26

page 28

tions by developing human

Web Link

resources.

Special Movie

Watch “KDDI Sustainable Action” in video

Connecting
Heartsand Minds

Connecting
and Protecting
Lives
Our resilient infrastructure
for communication has supported communication thathas served as a lifeline during
disasters.
It means implementing ICT

Building a Resilient
Infrastructure
for Communication
and Disaster Response
page 14

Conserving
the Environment

Initiatives for creating a digital society for affluence andpeace of mind are necessary
so people don’t feel lonely
and have healthy and fulfilling

page 16

lives in the era of diversity.

technology to reduce envi-

Our role of connecting heartsronmental impact, helping

and minds will be more im-our precious planet.

portant in the age of longevity.

12

KDDI Sustainability Report 2020

KDDI Sustainability Report 202013

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting and Protecting Lives Our resilient infrastructure for communication has supported communication that has served as a lifeline during disasters. It means implementing ICT technology to reduce environmental impact, helping our precious planet.

Corresponding SDGs

We are working to build a resilient network to secure telecommunications services during disasters while designing disaster-proof telecommunications facilities and securing measures to rapidly restore service.
Base stations equipped with batteries
for 24-hour operation

KDDI Sustainable Action

Building a Resilient Infrastructure
for Communication and Disaster Response

Approx.

ture that ensures communication service*As of the end of March 2020

Base stations deployed
across Japan

Land

50
137

Vehiclemounted

Portable

To Minamishima, Mie
Miyazaki

units

Satellite earth
station

2.0

Linedisconnection

au exchangeequipment

New Installation of Submarine Cables to Multiply Communication
RoutesWe have built a resilient network with multiple communication routes. Even if

Okinawa to Kyushu
submarine cable 780 km

a communication route becomes unavailable due to a disaster or other reaExisting route(Pacific Ocean)

New route(East China Sea)
Nago, Okinawa

Mobile phonebase station

sons, our high-quality service will continue to be provided by our system of
automatically switching to other available routes.

Gushikami,
Okinawa

As the Mission of a Telecommunications Business Operator,
KDDI Will Work to Maintain Resilient and High-Quality Communication

Possible coverage

Approx.

in affected areas.

Hioki, Kagoshima

Vehicle-mounted base stations
which act as mobile base stations rush to a site that lost communication.

Measuresfrom land, sea, and airin times of disasters

called upon to switch optical networks to satellite lines to restore service

units*As of the end of June 2020

km

KDDI Sustainability Report 2020

units

Communication
satellite

Satellite
Rangersmunication recovery specialists known as KDDI Satellite Rangers are

Sky
14

3,400

au Shops and KDDI offices are equippedwith batteries that can charge up to 200
smartphones and compact batteries that can
provide flexible support.

*FY2019 Results

When communication cables are severed in an earthquake, telecom-

Coverage area

Cable laying ships equipped with base stations restore telecommunications services
along coastal areas that are difficult to service
with vehicle-mounted base stations.

Approx.

KDDI provides a 4G LTE networkthat realizes smooth connections
even in mountainous areas.

Satellite Communication

support system during severe large-scale

Sea%

KDDI Satellite Rangers That Restore Communication by Using

our well-prepared land-sea-air recovery

10

99.9

Batteries with which au Shops andKDDI offices nationwide are equipped*As of the end of June 2020

at all times under any circumstances andApprox.

stations

These battery-equipped base stations ensure
battery-only operation for 24 hours or longer forcontinual service even during blackouts.

Our reliable communication infrastruc-disasters protect people’s lives as a lifeline.

2,200

4G LTE population
coveragekm

Aerial vehicle base stations provide coverage to isolated regions
from the sky to restore service.
*Demonstration tests ongoing as of June 2020

In 2019, the Japanese archipelago suffered from many disasters. In particular, when Japan was seriously damaged by Typhoon No.15 (Faxai) and No.19 (Hagibis), KDDI mobilized all available resources to achieve early recovery for affected customers.
KDDI, a designated public corporation, shoulders the important responsibility of providing telecommunications which is alifeline of society. To provide the highest quality service and telecommunication network, KDDI makes improvements seamlessly, promotes measures for large scale disasters, and fulfills its social responsibility.

Yukiko Habu
Deputy General Manager, Operations Management Department, Operations Division, Technology Sector

In addition, KDDI works on various measures in preparation for disasters such as the development of base stations using drones(demonstration tests ongoing as of June 2020) and remote operation of construction equipment in disaster stricken sites using 5G.
KDDI will continue to contribute to building disaster-resilient and sustainable communities by fulfilling our mission of connecting.

KDDI Sustainability Report 202015

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting and Protecting Lives Our resilient infrastructure for communication has supported communication that has served as a lifeline during disasters. It means implementing ICT technology to reduce environmental impact, helping our precious planet.

Corresponding SDGs

KDDI Sustainable Action

Conserving the Environment

CO2 zero emission target
Target7%

We will proactively drive a shift to renewablereductionenergy to achieve net-zero CO2 emissions by

0

Net CO2emissions2050 and reduce the environmental impact onsociety through the use of ICTs.

We recognize the importance of fulfilling our duty as a responsible global corporate citizen to conserve and protect the Earth’s
irreplaceable environment so that it can be inherited by future generations. We are committed to pursuing our business ineco-conscious ways through programs of activities.

Final disposal rate of retired
telecommunication facilities

Zero

2013

2030

2050 (year)

CO2 emissions

1,046,820

t-CO2

To curb rapid temperature increases, KDDI addresses the reduction of CO2 emissions.
*The CO2 emissions are calculated using the emission factors furnished by electric utility operators.
(Emissions from heat, steam and hot and chilled water consumption are included.)*FY2019 Results

Toward Achievement of the Environmental Conservation Plan:
KDDI GREEN PLAN 2017-2030
KDDI promotes the following three focus topics, namely, (1) Climate Action, (2) Creating a Recycling-Oriented Society, and (3) Conservation of Biodiversity. In particular,KDDI has been promoting initiatives in Climate Action with a target of reducing ourCO2 emissions by 7% in the fiscal year ending March 31, 2030 compared to the fiscal
year ended March 31, 2013 based on the long-term goals of the Paris Agreement adopted by COP21 and the Plan for Global Warming Countermeasures by the Japanese
government.
See page 84 for details.

Material recycling rate
for post-consumer mobile phones

99.8

%

We promote material recycling thatturns unneeded equipment and structural materials into resources.
* FY2019 Results

Number of post-consumer mobile
phones and other devices collected

2.79

General Manager, Mobile Base Site Facilities Design Department, Engineering Division, Technology Sector

16

KDDI Sustainability Report 2020

*FY2019 Results

Number of tribrid base stations

100

in
Japan

stations* FY2019 Results*As of the end of March 2020

Recycling of Mobile Phones: Manual Disassembly of Everycustomers into circuit boards and plastics. We collect gold, silver,

Hisayasu Muraguchi

KDDI reuses waste effectively
as resources.

We efficiently use three types of power,
namely, commercial power, power generated by solar panels, and storage batteries.

KDDI manually disassembles used mobile phones collected fromCurrently, KDDI is verifying the commercial introduction of fuel cells that are predicted to be a clean power supply. The useof clean energy including fuel cells not only leads to a reduction of CO2 emissions but also the extended provision of mobile
phone services during disasters and provision of mobile phone services to areas where securing a power supply is difficult.
We will promote technological development to deliver safety and security in addition to reducing the environmental impact.

%

We collect and recycle mobile phones,
batteries, and chargers that are nolonger necessary.

Single Part

Promoting Technological Development to Deliver Safety and Security as Well as Consideration for the Environment

million units

0.04

and copper from circuit boards while recycling as much plastics as
possible. When a machine is used to disassemble mobile phones,
plastics end up being burned in the incineration process and cannot be recycled. Therefore, we at KDDI perform all disassemblyCollection targetof post-consumer
mobile phones

6

million units* FY2018 to the end of FY2022

manually to prevent recyclable resources from being wasted.

In order to protect the global environment, which is the basis of our activities, we, as a member of society, will tackle the issue of
global climate change beyond national borders and realize both business growth and conservation of the global environment.

KDDI Sustainability Report 202017

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Day-to-day Lives KDDI has solved not only issues in cities and communities but also issues in developing countries by using new technologies and connecting partners. Furthermore, we are able to contribute to future generations by developing human resources.

Corresponding SDGs

We aim to solve diverse regional issues by utilizing our various advanced technologies andpartners’ know-how together with local governments, companies, and NPOs.
Reducing Working Hours for Water Control by 71% with
Rice Field Sensors and an Automatic Irrigation System
KDDI launched smart agriculture project in 2019 in Hida City,

KDDI Sustainable Action

Gifu Prefecture to solve issues in agriculture such as aging farmers and the lack of successors in farming. In the project, we in-

Sustainable Development for Cities
and Communities

Activity for ICT
implementation in regions

KDDI will realize the sustainable growth of communities by utilizing cutting-edge technologies such as 5G
and IoT together with various partners through the

projects*Cumulative target for the years
from FY2019 to FY2021

Minamisanriku-cho
4K 360-degree remote shopping
experienceestablishment of next-generation smart cities.
Hakuba-muraRegional tourism/
Shuttle bus operation app

Examplesof Regional
Revitalization
Initiatives
Using ICTs

60

Obihiro City
Smart agriculture

stalled sensors in rice fields that automatically measure waterlevels in addition to water and soil temperatures to enable thechecking of consolidated data on the cloud with tablets. We also
set up automatic irrigation systems that automatically control the
supply of water according to the water level in the rice fields so
farmers can check on the rice fields with tablets from home.
These solutions help decrease the frequency of visits to fields
and shorten work time, thereby saving labor and reducing cost.
Division of Work and Improvement of Yields and Quality of

We are promoting ICT implementation in regions through regional revitalization activities with ICTs such as
the co-creation of business in cooperation with municipalities and local
enterprises.

Outlying
islands

Agricultural Products with the Introduction of Agriculture IoTThat Automatically Supplies Water and Fertilizer
We have been promoting the introduction of an AI irrigation andfertilizing system called ZeRo.agri at Sachi Mitsurusato KDDI
Evolva Nobiru (Higashi-Matsushima City, Miyagi Prefecture).
Based on information acquired from solar sensors and soil sensors, AI calculates the necessary amount of water according toApprox. over

50,000stations

Toyota CityIoT child monitoring

See page 49 for details.

Base Station
Opening Plan

Most
in
Japan

Kimotsuki-cho
Smart agriculture/
Crop-spraying
drone
Okinawa Prefecture
MaaS in tourism/
Drone logistics forremote islands

2020

2021

2022

2023

(FY)

Promotion of Solving Regional Issues by Building
the Largest Number of 5G
Base Stations in JapanFor use in regional revitalization and creation of experience value, KDDI will actively
roll out 5G services as basic
next-generation infrastructure.

We Aim for Truly Sustainable Regional Revitalization by Developing Human Resources That Will Play an Integral Role in Solving
Regional Issues
KDDI confirmed the usability of ICTs through demonstration tests we conducted for solving regional issues with ICTs across Japan. Currently, we have a shortage of local companies and venture companies that play a key role in solving regional issues and local human resources who support such companies. Therefore, in addition to ICT demonstration tests, supporting and developing local venture companies and human resources is important. KDDI will strive to realize truly sustainable regional revitalization by carrying out humanresource development in regions with our know-how of open innovation and co-creation with venture companies.

Shigeki Matsuno
Administrative Officer, Corporate Strategy Planning Division

the growth of crops and automatically waters at the appropriate
timing. This solution separates work between IT and farmers andimproves yields and crop quality. Thanks to this system, shipments of cherry tomatoes were 1.6 times larger (2.4 times larger
per month at the most) than the previous year, and the period of
harvesting was cut down by one week. Backed by such great results, Sachi Mitsurusato KDDI Evolva
Nobiru was awarded the Mobile Business Award in the MCPC Award 2019.
* MCPC Award: For the purpose of encouraging the further use of mobile solutions and IoT/M2M systems, the MCPC Award recognizes outstandingachievements in the introduction of mobile systems such as improvements in work efficiency, business performance, or customer
satisfaction as well as the promotion of social contributions and advanced mobile use

Regional Revitalization with the Discovery and Fosteringof Start-Ups
KDDI and Makoto, Inc. (head office: Sendai City, Miyagi Prefecture) built a comprehensive partnership for the purpose of
discovering and fostering local start-ups with the aim of solving regional issues and sustainable growth. In addition to developing an education program that contributes to fostering
entrepreneurs by leveraging knowledge obtained through ourrespective experience of co-creation with start-ups over theyears, we will discover local start-ups and develop entrepreneurs that will lead the future of the region in coordination
with local education organizations.

KDDI will continuously commit ourselves to tackle diverse social issues through our business to contribute to the realization of Society 5.0 for SDGs that achieves both economic
growth and the solution of social issues.

18

KDDI Sustainability Report 2020

KDDI Sustainability Report 202019

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Day-to-day Lives KDDI has solved not only issues in cities and communities but also issues in developing countries by using new technologies and connecting partners. Furthermore, we are able to contribute to future generations by developing human resources.

Corresponding SDGs

KDDI Sustainable Action

Building the Iinfrastructure
for Developing Countries
Mainly in developing countries in Asia, KDDI will

Target number of mobile connections indeveloping countries where KDDI has atelecommunications business presence*76

build communication infrastructures so all local residents will be included in the communication area. We
will also provide high quality communication services
at low prices to realize industrial growth.

78(No. of cards)

73

Mounting All the Most Popular and Convenient Functions on Smartphones
MobiCom Corporation LLC offers MonPay mobile money service. Since the launch in 2016, MonPay has 350 thousand
customers at present. MonPay marked its fifth anniversary. Over the years, in addition to electronic payments and a point
program, we have realized the use of MonPay for public transportation, offered coupon menus, and coordinated MonPay
with games to enable customers to conveniently take care of many transactions with just their smartphones. We will continue to create more fulfilled lives for customers by mounting more convenient functions.

millionTatsuya Hamada

million

Chairperson and CEO, MobiCom Corporation LLC

millionEven in regions where the social infrastructure is not as well established as that of Japan, we are rolling out operational know2019

2020

2021

(FY)

* Number of mobile connections: Number of activated SIM cards

how and management methods developed in Japan with considerations to individual nation’s needs to ensure that customers
can expect reliable, uninterrupted service 24 hours a day, 365 days a year.
To Allow the Integration of Telecommunications and Life Design to Be Enjoyedby Many More Customers with Mobile Services

International
Contributionin Developing
Countries(Telecommunications & Education)[Mongolia][Myanmar]

Operating MobiCom general telecommunication business operator

Developing a telecommunications businessjointly with Myanmar Posts and Telecommunications (MPT) and Sumitomo Corporation

MobiCom has been operating a telecommunication business since 1995.
Local user share is number one.

Joint business was inaugurated in 2014.
Local user share is number one.

In Myanmar, we have been running a telecommunications business jointly with Myanmar Posts and Telecommunications (MPT) and Sumitomo
Corporation since 2014. Mobile phone penetration in Myanmar was around 10% in 2013, but a nationwide
expansion of service coverage enabled people in the country to enjoy high-quality and convenient network
service including internet access and watching videos on a smartphone. In 2018, the MPT Club point program
kicked off, and the MPT Money mobile money service was launched in 2020.
In Mongolia, general telecommunications business operator MobiCom Corporation LLC has been operating a telecommunications business since 1995, and in 2017, the company started to offer the first LTE
high-speed data communication in the country by carrier aggregation. In 2014, a Candy point program was[Bhutan]launched, and the provision of MonPay mobile money service started in 2016. MonPay leads the FinTech

Access network building
We built an access network using optical fiber/WiMAX/Wi-Fi in three mountainous villages locatedover 3,000 m above sea level.
* 2012 to 2013

[Cambodia]

market in Mongolia including a micro loan service started in 2017 and a joint debit card with major financial
institution XacBank launched in 2018.

Donation of 12 KDDI schools
We build and donate elementary and middle schools
across the country in cooperation with NGO based on
profits and donations from charity concerts.

Laying Optical Fiber in a Mountainous Region in Nepal
KDDI laid optical fiber cables and built a regional network in Dullu Municipality, which is the western mountainous region approximately 650 km from the[Nepal]Nepal capital of Kathmandu. We also developed an environment that en-

Conducting programming education activity

ables remote medical-checkups between a central hospital in the region andWe launched robot programming education in 2019. The
program offered in 10 schools develops problem solving
ability with logical thinking.

[Nauru]Laying optical fiber in a mountainous region

High-speed network construction

KDDI laid optical fiber in the western mountainous region
approximately 650 km from the Nepal capital of Kathmandu.

KDDI built a high-speed network connecting government offices, schools, and a hospital on the island of
Nauru.

health clinics under a medical university.

By providing our experience, know-how, and technological capabilities that we have cultivated both inside and outside of Japan,
we will continue to help improve quality of people’s lives and economic growth including increases in productivity and income.

* 2013 to 201520

KDDI Sustainability Report 2020

KDDI Sustainability Report 202021

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Day-to-day Lives KDDI has solved not only issues in cities and communities but also issues in developing countries by using new technologies and connecting partners. Furthermore, we are able to contribute to future generations by developing human resources.

Corresponding SDGs

Number of students enrolled
in foreign language education

KDDI Sustainable Action

Developing Human Resources
for the Next Generation

Approx.

90,000*FY2019 Results

We promote EdTech where
education and ICT are combined and support highquality foreign language education in global society.

KDDI has been working on the development of human resources that play a key role in thenext generation through the promotion of EdTech where education and ICT are combined
and provision of work experience opportunities where students can learn while enjoying
their studies.

Promotion of EdTech, Combinationof Education and ICT
English conversation school operator AEON,

KDDI will disseminate an easy-access ed-

KDDI, and KDDI Digital Design Inc. are promoting

ucation environment for everyone by inte-

where education and ICT are combined. We aim

grating education and technology to raise
the ICT education of Japan to the top of theworld and build a solid foundation for sus-

Education

×Technology

a joint project called AEON DX to pursue EdTech
to further maximize learning efficiency to increase
student proficiency and provide opportunities tostudy English comfortably by using big data andanalytics technology.

tainable growth.
Providing Occupational ExpeTotal number of visitors

19

Our Mission Is to Develop Human Resources That Can Flourish Globally
Due to impact from the spread of COVID-19, it has become difficult to continue with conventional education, and we think the reformation of how education is provided with ICTs will accelerate ata faster pace than ever before. We believe our mission is to continue developing human resources which can flourish globally without
being affected by the environment. For this purpose, we will focus
on offering a hybrid education environment at AEON English conversation schools where the advantages of online and offline lessons are integrated. We will also make a strong effort to provide
efficient lessons where students see improvements from using ICTs.

Over
million people*As of the end of March 2020

rience through KidZania
We offer occupational experience under the concept of
edutainment (learning while having fun) at KidZania where children can learn how society
works while enjoying activities.

Virtual reality experience of the Japanese Antarctic Research Expedition

LINK FOREST Training/Accomodation Facility That
Support Companies in Human Resource Development
The LINK FOREST training/accomodation facility offers
human resource development services including education programs and an education management systemcreated based on the experience and know-how of thehuman resource development that KDDI has cultivated.
We support the growth of individuals and companies and

LINK FOREST

contribute to the sustainable growth of society with rich
Ken Kumagaya
General Manager,
Business Development Department,
Corporate Strategy Planning Divisioncontents and the most suitable learning environments.

As a responsibility for future generations, we will support the development of human resources that can take action to solve issues faced by society, form a sustainable society, and build
the foundations of economic growth.

22KDDI Sustainability Report 2020

KDDI Sustainability Report 202023

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Hearts and Minds Initiatives for creating a digital society for affluence and peace of mind are necessary so people don’t feel lonely and have healthy and fulfilling lives in the era of diversity. Our role of connecting hearts and minds will be more important in the age of longevity.

Corresponding SDGs

KDDI offers a home IoT service and works on activities to educate users on
the use of telecommunication devices and internet safely and without worry.

KDDI Sustainable Action

Creating a Digital Society
for Affluence and Peace of Mind

KDDI Smartphone and Mobile Phone Safety Classes
In the youth-oriented classes, the lecturers teach children rules and manners for using a smartphone or mobile phone and go over teachable examples of trouble andincidents related to smartphones, mobile phones, and the internet. The classes are

KDDI will realize a digital society for afflu-

designed to enable children to use their own judgment and thereby avoid risks.

ence and peace of mind by protecting per-turers explain basic smartphone or tablet operation and how to safely use these de-In the senior-oriented classes which target seniors aged 70 or younger, the lec-

sonal information with security measures

vices without worry.

Settlements and financialtransactions¥6.5

which keep pace with rapid digitalizationand providing services including payment

trillionand financial services which are easily usable
by anyone.

* FY2019 results

Acceleration of New Smartphone-Centric
Financial Strategy “Smart Money Concept”

Pursuit of Smart Life through the Provision of Home IoT Services

Deposits/
wire transfers

While people’s lifestyles have become diversified, finan-

Network

Loanscial systems have become more complex and diversified
Mobileas well. KDDI will accelerate our Smart Money Conceptthat provides a safe and convenient payment and financial experience by using smartphones as a gateway so

au ID

financial matters are less intimidating for customers.

how family members and pets are doing. These services are equipped with
Settlements

Sense ofsecurity

IoT

motely check whether the doors and windows at home are closed andSmartphonefinancing
Fixed-line
telecommunications

Entertainment“au HOME” and “with HOME” are home IoT services that allow users to re-HealthcarePetsa voice control function for home appliances and a message function torealize a convenient smart life that provides a sense of security.

CommunicationHome
appliances

Electricity
Investments

Brick-and-mortar
Insurance/pensions

Total management amount
We Will Accelerate Realization of the Smart Money Concept by Expanding the au PAY Smartphone Payment Service
We are focusing on expansion of the au PAY smartphone payment service. The popularization of cashless payments is not only
essential for the realization a digital society for affluence and peace of mind but it is also extremely important for offering services
tailored to the daily shopping behavior of customers.
We build points of contact with customers through au PAY and Ponta as well as offer new value to customers by coordinating a wide variety of financial serv ices such as deposit, credit, asset management, loans, and insurance. Through these measures, we will accelerate realization of the Smart Money Concept.

Atsushi Nagano
General Manager, Financial and Payment Business Department, Business & Services Development Division, Personal Business Sector

24KDDI Sustainability Report 2020¥20

billion(approx.)

Co-Creation with Start-Ups and Business Corporations through KDDI Open Innovation Fund 3
KDDI established fund programs that reinforce our efforts in fields of increasing importance inthe 5G era such as AI, IoT, and FinTech, and we are aiming for new business creation throughsupport for prospective start-ups.

*At the end of FY2022

We will continue to work on creating new value and minimizing risk in the digital society to contribute to the realization of a secure
Society 5.0 for SDGs where everyone can enjoy worry-free convenience.

KDDI Sustainability Report 202025

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Hearts and Minds Initiatives for creating a digital society for affluence and peace of mind are necessary so people don’t feel lonely and have healthy and fulfilling lives in the era of diversity. Our role of connecting hearts and minds will be more important in the age of longevity.

Corresponding SDGs

KDDI thinks that mutual respect for and understanding of diversified personalities and sense of values are essential for acompany’s sustainable growth. Therefore, KDDI promotes diversity and inclusion on a company-wide basis.

KDDI Sustainable Action

Advancement of Female Employees
KDDI considers the support for women’s advancement as a management issue

Promotion of Diversity and Inclusion

Number of female line managers *200KDDI will be a role model as a business operator

156

with a social mission by providing services andworkplaces that respect diversity and realize an
inclusive society that respects diversity.

Targetand focuses on developing female leaders and promoting female employees toleadership positions. Our various human resource development measures include the Female Line Manager Program. In addition, by establishing a system
to support the work-life balance of employees and promoting work style reform,
KDDI has been working on the establishment of an environment and fostering a
climate where female employees can make use of their diverse abilities and perform to the best of their abilities even while experiencing life events.

111 118

Expanding Employment Opportunities and Advancement of Persons with Disabilities

2017

2018

2019

2020 FY

KDDI has been working on creating a supportive environmentthat enables employees with disabilities to flourish by provid-* Leadership positions in the organization with authority
over personnel evaluations

ing a translation app and summary writing. As role models for
those with disabilities who play active roles in a company,

Aiming to Foster a Corporate Culture That Accepts Diversity
For supporting female employee advancement, in addition to internallytraining personnel, KDDI has proactively promoted their participation incross-industry forums, with a focus on initiatives to raise female employees’ viewpoints. As a result, in April 2020, we had two female Executive Officers resulting in an increase of female decision makers.
To support the advancement of persons with disabilities, we established a special KDDI subsidiary which manages cafes in offices
and undertakes assignments from KDDI to increase opportunities
where persons with disabilities can flourish. As of June 1, 2020, we
maintained a 2.53% employment rate of persons with disabilities.
In addition, KDDI also proactively works on LGBT issues, and in
fiscal 2020 launched Familyship Application System that treats childrenof same-gender partners in the same way as
those of married couples under its company
regulations.
We are aiming to foster a corporate culture that accepts diversity through these initiatives.

ACE Award
grand prix
prize winners

3

employees* 2014, 2017, 2019

Employment rateof persons
with disabilities

2.53* As of June 2020

three KDDI employees, the most among the participatingcompanies in the ACE * Award, received its grand prix prize.
KDDI Challenged Corporation, a special KDDI subsidiary,
manages mainly cafes in offices and promotes self-sufficiency
and the flourishing of employees with disabilities by targeting%the expansion and creation of work and occupational fields.
* ACE: Accessibility of Consortium of Enterprises. Consortium of companies aiming toestablish new employment models of people with disabilities that contribute to thegrowth of companies

Increasing the Understanding of LGBT and Creation ofWorkplaces Respecting Individuals
We at KDDI strive to improve the understanding of LGBT(sexual minority) in the company with seminars and other activities so LGBT employees can work comfortably and energetically. In addition, we revised internal regulations sosame-gender partners are included as spouses in all internal
systems. Moreover, we also revised entry sheets for recruiting applications so applicants do not have to enter a gender.

Kaname Utsumi

KDDI ALLY logo stickers
aiming for expanding allies (supporters)

Head of Diversity & Inclusion Department,
Human Resources Division, Corporate Sector

KDDI mobilizes a wide range of diverse abilities which become a source of innovation leading to the sustainable growth of individuals and the organization and aims for the realization of a society where no one
is left behind.
26

KDDI Sustainability Report 2020

KDDI Sustainability Report 202027

Top Message
Building a Resilient Infrastructure forCommunication and Disaster Rresponse

Conserving
the Environment

Sustainable Development
for Cities and Communities

Building the Infrastructure
for Developing Countries

Developing Human Resources
for the Next Generation

KDDI’s Commitment to Sustainability

Creating a Digital Society
for Affluence and Peace of Mind

Feature Article: KDDI Sustainable Action

Promotion of Diversity
and Inclusion

Materiality

Management Framework

Stakeholder Engagement

Fostering Healthand a Purpose in Life

Feature Article

Connecting Hearts and Minds Initiatives for creating a digital society for affluence and peace of mind are necessary so people don’t feel lonely and have healthy and fulfilling lives in the era of diversity. Our role of connecting hearts and minds will be more important in the age of longevity.

Corresponding SDGs

40

Internal counsellors

KDDI Sustainable Action

Fostering Health and a Purposein LifeApprox.

*FY2019 Results

In an era where people live longer, KDDI will realize a society where anyone can feel healthy andsatisfied in their job by taking leadership in theexecution of work style reform and utilizing cutting-edge ICTs.
Declaration of New Work Styles
Let’s Design Each Person’s WorkWe design work in line with employee life stages and values, connect their endeavors
to personal growth, self-actualization, and the growth of the organization,
and aim to become an attractive KDDI where employees are proud to work.

KDDI where employees are proud to work
Personal growth andself-actualization

Self endeavors

Employees changeWork styles

Growth of theorganization
Company change

MindsetA mindset where
employees learn
Create new valueon their own, sharethrough inter-organitheir knowledge,
zational collaboration and directly connectthat to organizational
achievement

Work environment

Rules and systems

Upgrade the environment using advanced
technologies toenable employees tochoose their times
and places

Systems that support
new work styles andevaluate accomplishments and endeavors

We accept diverse human resources, foster mutual trust and admiration,and make employee strengths the organization’s strengths.

counsellors

Total number of employees interviewed

12,000employees

Approx.

*FY2019 Results

Creating a Workplace Environment Where Employees Can Remain Healthy and Work Energetically and
Perform to Their Utmost
KDDI established a new dedicated organization known as the Work
Style Reform & Health Management Department to encourage drastic awareness and behavior change from conventional work styles
to realize a workplace environment where all employees can remain
healthy and work energetically and perform to their utmost.
In addition, we formulated the Declaration of New Work Styles
centering on the realization of work styles that allow individual employees to achieve results without being limited by hours or location inthis new normal era triggered by the spread of COVID-19. By building
an environment where employees can select their own working hours
and locations with advanced technologies and by supporting newwork styles as well as introducing a system to evaluate employee
accomplishment and endeavors, we will increase employee engagement and corporate competitiveness.

KDDI is working on building a workplace where employees can work happily and energetically by promoting health-focusedmanagement and work style reform in addition to working on disease prevention and health support of all society with cutting-edge ICTs.
Prohibition of Smoking at All KDDI Offices and Discontinuation of Company-Wide Dress CodeAs part of health-focused management and work style reform, smoking rooms in offices were removed. Smoking in offices is now prohibited in KDDI. In addition, we discontinued our dress code which was
uniformly applied to the entire company and established guidelines
tailored to each sector according to characteristics of the work.
KDDI will continue to seek the realization of sustainable growthby promoting new ideas, sense of values, and work styles and in-

Smoking rate18%

or less* Target value as of end of FY2020

creasing the independence and productivity of individual employees
under our human resource strategy of autonomy and responsibility.
Promoting the Active Role of Elderly Employees
KDDI has been working on various environment creation measures to further broaden
the work fields of elderly employees. In addition to reemployment after retirement up to
65 years of age, KDDI has various systems that enable elderly employees to work energetically such as career development training and an open recruitment system for elderly employees in preparation for the era when people live longer.

Formulation of the Mental Health Promotion Plan to Enhance Our Initiatives to Support Employee Mental HealthKDDI works to enhance support for employees with the belief that the health of employees and a heathy workplace environment are important for employees to work autonomously and with high productivity. In fiscal 2019, we appointed approximately 40 experienced managers as internal counsellors and began interviewing all employees twice a year. The interviews enable us to assess working conditions from perspectives that differ from those of their superiors and to identify
employees who are showing signs of difficulty even in the absence of reports from said employees.

“Smaho de Dock” Self Health Examination Service
KDDI offers Smaho de Dock self health examination service that enables the online management of physical health. The service makes heath examinations easy and quick for busy individuals who find it difficult toreceive health checkups such as parents busy with child-rearing and self-employed individuals and contributes to unearthing those who have not had a health examination and early discovery of disease.

Number of organizations
using Smaho de Dock

139

organizations*As of April 2020

Kazunori Tanaka
Head of Work Style Reform & Health Management Department, Human Resources Division, Corporate Sector

KDDI will continue to support the health of individual employees as well as healthy lives of all people of any age with the aim ofreform into more innovative work styles.

28

KDDI Sustainability Report 2020

KDDI Sustainability Report 202029

Top Message

Message from Executive Officer of SustainabilityKDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

Message from Executive Officer of SustainabilityKDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

GovernanceKDDI also actively engages in diverse businesses in non-communication
fields while strictly adhering to the Corporate Governance Code and putting the KDDI Group Philosophy into practice in its corporate activities.
Particularly today we believe in the importance of strengthening corporate
governance across the entire Group, including subsidiaries, and we arebuilding a structure for sharing know-how and proactively supporting
Group companies in this regard. KDDI meets with institutional investors
face to face on the topics of governance and sustainability and holds
events directed at individual investors as part of its proactive efforts topromote dialogue with stakeholders and reflect their voices in management decisions.
Environmental Measures
Movements to address environmental problems have gained momentum
with the Paris Agreement, Sustainable Development Goals (SDGs), theTask Force on Climate-related Financial Disclosures (TCFD), and the EU
Taxonomy. While the world has begun to move towards zero CO2 emissions, renewable energy has not adequately spread throughout Japan,
which urgently needs a concrete action plan in this regard. Through ourcore ICT business and other information communications operations, we
contribute to improvements in work efficiency and reductions in the movement of people, helping to reduce CO2 in society and rein in climatechange. As these benefits are countered by a growing impact caused by
the installation of telecommunications equipment, in 2017 KDDI formulated the KDDI GREEN PLAN 2017-2030 to reduce CO2 emissions throughthe use of energy-saving telecommunications equipment and renewableenergy, setting a goal for reducing its total volume*1 of CO2 emissions
ahead of other telecommunications carriers in Japan. We also declared in
KDDI Sustainable Action that we will reduce the environmental impact onsociety through the use of ICT, aiming to substantially achieve zero CO2emissions by 2050.
Human Resources
As the productive population declines in Japan, it is imperative that companies provide attractive work environments that enable diverse work
styles (time, location, type of employment, etc.) so that employees canuse their various skills to the fullest, with the ultimate aim of sustaining
30

KDDI Sustainability Report 2020

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6KDDI’s Material Sustainability Issues
We at KDDI have identified six material sustainability issues among the numerous issues we face in relation to our business activities, based on theeffect they have on stakeholder reputation and decision-making and thecompany’s impact on the environment, society and economy.

Based on the KDDI Group Mission Statement of contributing to the development of a truly connected society, KDDI has made concerted efforts tosolve social issues as an infrastructure company that supports the information foundations of society.
In May 2019, we announced KDDI’s target SDGs together with theMedium-Term Management Plan for fiscal 2019-2021. In the process ofpromoting our initiatives for the SDGs, we revisited the scope of theinitiatives based on social issues to designate eight social issue categories
based on the scale of related social issues and the business areas inwhich KDDI can contribute as a communications carrier, and in May 2020,
we formulated the new KDDI Sustainable Action in line with the KDDI
SDGs for 2030.
The basis for these endeavors is our sustainability activities that havecentered on six material sustainability issues. In this report, we delve into
this subject in detail, but here the context of our discussion focuses on
corporate governance, environmental measures, human resources andhuman rights policies.

Materiality

The Sustainability Committee periodically checks up on progress being
made toward KPIs set for each material issue.

S SocietyExecutive Officer of Sustainability
General Administration Division

1 Safer and more resilient connected world

Minoru Tanaka• Resilience to extreme weather events• Risk management

growth as a company and contributing to society. KDDI will continue topromote respect for diversity—in the context of women, nationality,
LGBT*2 orientation, disability, and age / generation—and work to accommodate various personalities and abilities in its organization. In April 2019,KDDI LEARNING CORPORATION was established as a wholly owned
subsidiary to take charge of human resource development for employeesof the KDDI Group. While supporting the growth of KDDI Group employees, promoting the exchange of human resources, and creating synergies
in Group operations, KDDI LEARNING plans to offer educational services
for its stakeholders by using KDDI’s accumulated experience and knowledge in human resource development. In April 2020 we opened LINKFOREST, integrated training facilities with a hotel, a museum, and a hallwhere events can be held. The facilities offer not only learning opportunities but also human resource development services built on our experience and expertise to help people and companies grow, contributing tosustainable growth of society. In April 2018, the Company announced theKDDI Group Declaration of Health-focused Management in a message
from the President, and then created the Work Style Reform & HealthManagement Department in January 2019 as an organization focusing on
health management. By promoting health management, we aim to establish a “health first culture” that fosters improvements in employee vitality
and productivity.
Human Rights
As part of the ICT industry, we face many potential human rights issues,
including rights to privacy and freedom of expression as well as requests
from government authorities to disclose customer data for legitimate purposes. We will continue our efforts to identify and address human rights
issues in our business activities through ongoing dialogue with our stakeholders, while furthering understanding among employees of the KDDI
Action Guidelines and the KDDI Group Human Rights Policy. In March
2020 we conducted human rights due diligence to identify risks and opportunities across our business activities and take appropriate actions
based on them. We will continue monitoring the effectiveness of these activities for further improvement.
KDDI carries out various sustainability activities centered on six material
sustainability issues, and is accelerating efforts to advance sustainability
and SDGs by linking them to business strategies in its Medium-Term Management Plan. We will contribute to the sustainable growth of society
through efforts to solve social issues unique to Japan and issues related to
the SDGs, while valuing the communications we have with all stakeholders.
*1 7% reduction in CO2 in FY2030 compared to FY2013 for KDDI (in Japan, non-consolidated)*2 LGBT stands for lesbian, gay, bisexual and transgender. Gender minorities include other people
with identities other than LGBT, but for the sake of convenience in this report, LGBT refers to allgender minorities, including LGBT.

2 Cyber security and privacy protection• Utilization of information assets and tightening of security• Data privacy

3 Fulfilled life brought through ICTs
• Contribution to economic growth through robust information
communications infrastructure• Improvement of access to education, medicine and other public
services through ICTs
• Promotion of employment creation and capacity building• Innovation management

4 Rewarding workplaces for diverse talents• Promotion of diversity and inclusion• Human resource development and career development• Pursuit of employee satisfaction• Promotion of health-focused management

By continuing to provide secure, resilient and high-quality communications
services for a highly connected society, KDDI maintains lifelines for people andhelps create the foundation for a safe and secure information-based society.
The Company is building systems hardened against disasters, while aiming tocollaborate with related institutions to provide reliable information communications services even during unforeseen incidents like natural disasters.
We have put into place a complete system for protecting the confidentiality ofcommunications and customer information so that customers can utilize ourservices without worry. We have a special organization dedicated to thwarting
external cyberattacks, monitoring our networks for suspicious activity 24 hours
a day, 365 days a year. While strengthening governance, the KDDI Group has
put in place an information security framework to prevent internal leaks of information.

For the coming era of 5G and IoT, KDDI is accelerating initiatives to realize “theintegration of telecommunications and life design.” With communications as
its core business, KDDI intends to expand services that are essential in its
customers’ lifestyles, such as content, commerce, energy, financial services
and education, in a bid to solve social issues and bring more abundance toeveryone’s lives.

KDDI aims to motivate its employees and improve its competitiveness as acompany by optimally assigning personnel and maximizing the value of humanresources by applying the diversity and multifaceted capabilities of its employees as organizational strengths.
Furthermore, the Company is promoting health management and work
style reforms with the objective of helping employees maintain and improvetheir physical and mental well-being, while ensuring their safety. By instilling in
our corporate culture a reverence for health, we strive to enhance the vitality
and productivity of our employees.

G Governance

5 Respect for human rights and fairness in business• Pursuit of sustainable procurement• Respect for workers’ rights• Prevention of corruption and bribery• Promotion of fair and proactive communication

KDDI strives to eliminate or minimize any negative impact on human rights,
while taking action to raise human rights awareness, based on the KDDI Codeof Business Conduct (a basic set of principles for respecting human rights andindividuality) and the KDDI Group Human Rights Policy, which covers all
Group companies, based on international standards including the Universal
Declaration of Human Rights.
The KDDI Guidelines for Responsible Supply Chain, which is directed atour business partners, explicitly forbid forced labor, inhumane treatment, childlabor, and discrimination. KDDI takes steps to ensure these initiatives are wellunderstood.

E Environment

6 An energy-efficient, circular economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs• Reduction of society’s impact on environment through ICTs

KDDI GREEN PLAN 2017-2030 is a set of long-term goals for fiscal 2030,
such as reducing KDDI’s CO2 emissions by 7% from the fiscal 2013 level (inJapan, non-consolidated). We will proactively drive a shift to renewable energy to substantially achieve zero CO2 emissions by 2050 and reduce the environmental burden on society through use of ICT. As data traffic increases,
power consumption is expected to rise. We are committed to reducing CO2
emissions. Technological innovation to reduce power consumption is one
way to achieve this.

KDDI Sustainability Report 202031

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6KDDI’s Material Sustainability Issues
Process for Re-identifying Material Issues (FY2016-FY2017)KDDI Group

Policy1. Screen for issues from the two perspectives of impact on stakeholder assessments and decision-making, as well as the impact KDDI has on society, theenvironment and the economy
2. A ssign priorities for each issue based on comparative evaluations
3. Identify six material sustainability issues that reflect the opinions of external experts gained through dialogue
4. The Sustainability Committee confirms the suitability of the material issues, which are then approved by the Corporate Management Committee and reported to the Board of Directors. For details of the re-identifying process, please refer to our Sustainability Report 2018.

Web Link

1 Safer and more resilient

2 Cyber security and privacy

1-1 Resilience to extreme weather events
1-2 Risk management

2-1 U
 tilization of information assets andtightening of security
2-2 Data privacy

3 Fulfilled life brought

4 Rewarding workplaces

3-1 C ontribution to economic growththrough robust information
communications infrastructure
3-2 Improvement of access to education,
medicine and other public services
through ICTs
3-3 P
 romotion of employment creationand capacity building
3-4 Innovation management

4-1 Promotion of diversity and inclusion
4-2 Human resource development andcareer development
4-3 Pursuit of employee satisfaction
4-4 P romotion of health-focused management

5 Respect for human rights

6 An energy-efficient,

5-1 Pursuit of sustainable procurement
5-2 Respect for workers’ rights
5-3 Prevention of corruption and bribery
5-4 P romotion of fair and proactive
communication

6-1 E nergy efficiency improvement andutilization of clean energy
6-2 Zero emissions and 3Rs
6-3 M itigation of society’s impact onenvironment through ICTs

connected world

Sustainability Report 2018

▪ Matrix of material issues
Effect on stakeholder assessments and decision-making

Material issues identified by KDDI

protection

through ICTs

5-3

6-1

3-1

6-2
1-1
4-2

5-4

6-3 4-1

5-1
3-4

3-2

5-2

4-3

2-1

3-3
2-2

1-2
4-4

for diverse talents

and fairness in businessCompany’s own impact on the environment, society and economy

circular economy

Enhancing Internal Understanding of Sustainability and SDGs
In February 2019, the President was appointed as chair of the Sustainability Committee, and the other members of this committee were shuffled toinclude all executive directors, general managers of all sectors of theheadquarters, the head of the KDDI Foundation, and auditors. The committee is promoting the SDGs and considers sustainability to be a pillar ofcompany-wide business strategies.

KDDI Group

Promotion& Other
Activities

In his New Year’s address and announcements of management policies for the next fiscal year, the President conveys to all employees theimportance of advancing sustainability initiatives in business strategies tosolve social issues through business activities in a bid to realize a sustainable society. Moreover, officers visit business sites across the nation to directly convey corporate policies to employees and elicit their opinions.

For management
Dialogue with Stakeholders about SDGs (July 2019)KDDI held an SDGs workshop for President and other management members including assistant general managers.
We invited Ms. Ayako Sonoda, President of Cre-en Inc., to our headquarters and held a stakeholder dialogue session for the President andexecutive officers from the Deputy General Manager level up on the themeof “what role KDDI is expected to play in the drive towards a sustainable
society,” which was attended by 113 participants. KDDI’s new Medium-Term Management Plan for fiscal 2019-2021 released in May 2019sets out the company’s vision, to which a new third point—“contributing
to the sustainable growth of society”—has been added. The company
also presented an overview of KDDI’s target SDGs alongside the Management Plan. This dialog session was held with the aim of exploring how
KDDI can achieve its target SDGs.

Web Link

Stakeholder Dialogue

For SDGs promotion leaders

Relationship between Material Issues and KDDI Sustainable Action
KDDI engages in various business activities and initiatives that help
contribute to the attainment of SDGs. KDDI’s Medium-Term Management
Plan for fiscal 2019-2021 released in May 2019 sets out the company’s
vision, to which a new target of “contributing to the sustainable growth ofsociety” has been added. The company also presented an overview ofKDDI’s target SDGs together with quantifiable performance indicators
consistent with the Management Plan. As part of our efforts to promote
the SDGs, we reviewed the scope of our initiatives based on social issues.

KDDI Group

Policy &System

And we revised KDDI’s Target SDGs from the perspective of “magnitude
of social issues” and “business areas where we can contribute more as atelecommunications carrier,” and established target “KDDI Sustainable
Action” for 2030 in eight categories of social issues.
Our material issues relate to the social issue categories as shown in
the table below. By addressing the issues, we believe that we can contribute to the achievement of the SDGs.

Web Link

KDDI Sustainable Action

Social issue categories
Promotion ofdiversityand inclusion

Fostering healthand a purpose inlife

4.	Rewarding workplaces fordiverse talents●●

5.	Respect for human rights andfairness in business●

1.	Safer and more resilient
connected world

Conserving
the environment●

Sustainable
Developing human Creating a digital
Building
development for cities the infrastructure for resources for the society for affluenceand peace of mind
and communities
developing countries
next generation●

2.	Cyber security and privacy
protection●

Materiality

3.	Fulfilled life brought through
ICTs

6.	An energy-efficient, circular
economy●●KDDI held an SDGs promoters workshop for the General Manager ofPlanning and Directors of Planning in the sectors of the headquarters, who
are responsible for promoting the SDGs.
The workshop was implemented as part of efforts to promote measures toward the achievement of KDDI’s Target SDGs formulated alongwith the Medium-Term Management Plan and was attended by 23 participants. Mr. Norio Masuda, senior manager, Sustainability Promotion Division, Hitachi, Ltd. was invited to make a speech on the theme “Introduction of Hitachi’s Initiatives for the SDGs.”

Web Link▪ Relationship between KDDI’s material issues and eight social issue categories (KDDI Sustainable Action)
Building a resilient
infrastructure forcommunication anddisaster response

SDGs Promoter Workshop (August 2019)●

SDGs Promoter Workshop (Japanese only)

For general employees
Representatives of the Sustainability Department visited offices across Japan, including business and supervisory divisions in the Tokyo area, tohold workshops for over 440 employees in total to help them deepen understanding of the SDGs.
As a bottom-up measure, we implemented two e-learning training
sessions to deepen understanding of materiality and the SDGs and also
held SDGs workshops and seminars, which around 120 applicants fromamong KDDI Group employees attended to discuss ways to achieve theSDGs through everyday activities at home and in the workplace.

Web Link

SDGs study sessions and workshops were held to help employees
deepen their understanding of the SDGs. (Japanese only)

Corresponding SDGs

32

KDDI Sustainability Report 2020

KDDI Sustainability Report 202033

Top Message

Message from Executive Officer of SustainabilityKDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

FY2019 Material KPI Results

1

Issues

FY2019 Material KPIs

3

Cyber security
and privacy
protection

Fulfilled life
brought through
ICTs

S

5

G

*Following the guidelines of the accident reporting criteria of Japan’s Ministry of Internal
Affairs and Communications●

0 (no accidents)

Achieved

Implement measures to prevent leaks and enhance earthquake protections
at communication stations (FY2021)●

Measures to prevent leaks were taken at 7 additional communication stations (September 2019).

Stilunder way

• Utilization of
information assets
and tightening of
security• Data privacy

Data security incidents: 0*Data breaches, complaints, etc., that are illegal or subject to regulatory guidance●0

Achieved

Data security training for all employees: held at least once a year●

2 times (Implemented an e-learning
program for all employees)

Achieved•C ontribution toeconomic growththrough robust
information
communication
infrastructure• Improvement ofaccess to education,
medicine and otherpublic services
through ICTs
•P
 romotion of
employment
creation andcapacity building• Innovation
management

Provide 5G services in all prefectures of Japan (FY2021)●

15 prefectures

Stilunder way

60 regional revitalization projects (initiatives to co-create solutions for issues
with regions using IoT and ICT) (cumulative total FY2020.3–FY2022.3)●

30 (FY2019)

Stilunder way

Reach 70 million mobile connections*2 in developing countries where
KDDI has a communications business presence (FY2021)●●

76,410,000 *2

Stilunder way

ICT projects to eliminate the information gap: 6 (cumulative FY2019–FY2021)

●

2

Stil
under way

ICT education support in developing countries: Set up English and computer classes at 11 schools in Cambodia (cumulative FY2019-2021)●

Classes were set up at 10th and 11th
schools.

Stilunder way●

Approx. 90,000 (FY2019)

Stilunder wayStilunder wayE

• Promotion ofdiversity andinclusion• Human resource
development andcareerdevelopment• Pursuit of employee
satisfaction• Promotion ofhealth-focusedmanagement

●

●

●

Aeon, an English language school,
conducted a trial of “AI Study Design—
grammar version” (officially launched in
April 2020) and a trial of “AEON UP!,” acoaching service based on data science(officially launched in July 2020).

Settlement and financial transactions: 6.0 trillion yen (FY2021)●●

6.5 trillion yen (FY2019)

Stilunder way

Promoting measures to hire 200 female line managers (by the end of FY2020)●

Number of female line managers: 156
as of April 1, 2020

Stilunder way

Percentage of newly hired female graduates: 30% (by the end of FY2020)●

32.3% (FY2019)

Stilunder way

Disability employment rate: statutory rate achieved● *4

2.53% as of June 2020

Achieved

As a leading company in promoting the professional advancement ofelderly employees, establish a foundation for promoting such advancement (FY2021 target)●• Number of participants in the career
design course: 753 (FY2019)• Number of applicants for in-housepositions: 202 (FY2019)

Stilunder way

Usage rate of annual paid leave: 70% (by the end of FY2020)●

66.9% (FY2019)

Stilunder way

Healthcare management initiatives• Illness detection rate (legally mandated): 55% or less (target figure for FY2020 end)•R
 ate of smokers: 18% or less (target figure for FY2020 end)●• Illness detection rate: 59.8% (FY2019)• Rate of smokers: 24.3% (FY2019)

Stilunder way

●

2

Not
achieved yet

●

91.5%

Not
achieved yet

Measures for instilling the KDDI Code of Business Conduct company-wide:
12 or more per year●

A mail magazine was issued 12 times
a month to instill the KDDI Code ofBusiness Conduct.

Achieved

Collection rate of sustainable procurement surveys: 90%

KDDI Group Philosophy Study Session attendance: 100%●

96%

Achieved

KDDI Smartphone & Mobile Phone Safety Classes, Comprehension Rate,
Satisfaction Rate
• For youths: satisfaction with education materials: 99%; satisfaction withlecturers: 99%; desire to reapply: 80%• For older people: comprehension rate: 86%; usage rate: 92%●•F or youths: satisfaction with educationmaterials: 99.3%; satisfaction with lecturers: 99.1%; desire to reapply: 84.3%• For older people: comprehension rate:
85.1%; usage rate: 91.5%

Partially
achieved

7% reduction in CO2 emissions in FY2030, compared to FY2013 for KDDI(in Japan, non-consolidated).

●

FY2019 target: 1,007,273t-CO2*5
FY2019 results: 1,046,820t-CO2*5

Stilunder way

Maintain zero emissions from retired telecommunication facilities
Final disposal rate: 1% or less (Zero emissions is defined as having a final
disposal rate of 1% or less)●

Final disposal rate: 0.04% (FY2019)

Stilunder way

Upgrading to highly energy-efficient data centers in Japan and abroad●

Not applicableStilunder way●

Maintain material recycling rate of 99.8% for post-consumer mobile phones●

99.8% (FY2019)

Stilunder way

Post-consumer mobile phones collected over 5 years (aggregated):
6 million (Target for FY2018-FY2022)●

FY2019 target: 2,400,000 (cumulative)
FY2019 results: 2,422,620 (cumulative)

Stilunder way

*1 The status of KPIs with a target set to achieve by FY2020 and beyond are indicated as “Still under way” across the board, including those progressing according to the FY2019 plan.
*2 Number of mobile connections: Number of activated SIM cards (GSMA’s “Mobile connections, including licensed cellular IoT”) FY2019 results are the number of connections as of April 2020.
*3 Adaptive learning: The provision of study materials and learning methods optimized for each individual, based on each student’s level of understanding and progress.
*4 Includes KDDI Challenged (special subsidiary) and KDDI Engineering*5 The CO2 emissions are calculated using the emission factors furnished by electric utility operators. (Emissions from heat, steam and hot and chilled water consumption are included.)

34

KDDI Sustainability Report 2020

Materiality

1

2

Materiality 5

Stakeholder Engagement

Materiality 6

IssuesBoundary (scopeof aggregation)

FY2020 Material KPIs

KDDI
Unconsolidated

Safer and more resilient
connected world• Resilience to extreme weather events• Risk management

4G LTE population coverage rate over 99.9% (FY2021)●

Implement measure to enhance the resilience of telecommunication routes●

Cyber security and privacy
protection*Based on the guidelines of the accident reporting criteria of Japan’s Ministry of Internal Affairs andCommunications●

Implement measures to prevent leaks and enhance earthquake protections at
communication stations (FY2021)●• Utilization of information assets and tightening Data security incidents: 0*Data breaches, complaints, etc., that are illegal or subject to regulatory guidanceof security• Data privacy●

3

Fulfilled life brought through
ICTs

KDDI
Group

●

●

Data security training for all employees: held at least once a year
• Contribution to economic growth through robust
information communications infrastructure
Provide 5G services in all prefectures of Japan (FY2021)• Improvement of access to education, medicine
and other public services through ICTs
• Promotion of employment creation andcapacity building
60 regional revitalization projects (initiatives to co-create solutions for issues with regions• Innovation management
using IoT and ICT) (cumulative total FY2020.3–FY2022.3)

●

●

S

4

5

Rewarding workplaces fordiverse talents

Respect for human rights andfairness in businessG

6E• Environment• Environment• Energy efficiency
improvement andutilization of clean
energy• Zero emissions and
3Rs• Mitigation ofsociety’s impact onenvironment
through ICTs●

Realize highly effective learning environments using adaptive learning*3
and other advanced techniques (FY2021)

*Human rights violation refers to abuse of human rights, such as power harassment, subject to disciplinary action.

Management Framework

Number of serious accidents: 0

Number of language education students: around 130,000 (FY2021)

Number of cases of human rights violation: 0

Materiality

Evaluation*1

Achieved• Pursuit of
Respect forsustainablehuman rights andprocurement
fairness inbusiness• Respect forworkers’ rights• Prevention ofcorruption andbribery• Promotion of fairand proactive
communicationAnenergy-efficient,circular economy

Results●

From FY2020 onwards, this target will be revised to accommodate the new online education environment toward the New Normal, and integrated into the current target, “Createa highly efficient educational environment using advanced technologies such as adaptive
learning.”

Materiality 4• Promotion of diversity and inclusion• Human resource development and careerdevelopment• Pursuit of employee satisfaction• Promotion of health-focused management• Pursuit of sustainable procurement• Respect for workers’ rights• Prevention of corruption and bribery• Promotion of fair and proactive communication• Governance• Governance
6

Rewarding
workplaces fordiverse talents

KDDI
Group

• The Hokkaido Route was made more
resilient (June 2019)• New cabling to Okinawa (March 2020)

Implement measure to enhance the resilience of telecommunication routes

Materiality 3• Society• Society4KDDI
Unconsolidated

FY2019 Results

Stilunder way

Number of serious accidents: 0

2

Boundary (scopeof aggregation)

99.9%

4G LTE population coverage rate over 99.9% (FY2021)

Materiality 2

Feature Article: KDDI Sustainable Action

FY2020 Material KPIs●

• Resilience toSafer and more
extreme weather
resilient connected
eventsworld• Risk management

Materiality 1

ESG

ESG

Materiality

KDDI’s Commitment to Sustainability

An energy-efficient, circular
economy• Energy efficiency improvement and utilizationof clean energy• Zero emissions and 3Rs• Mitigation of society’s impact on environment
through ICTs

Reach 78 million mobile connections *1 in developing countries where KDDI has a communications business presence (FY2021)●●

Realize highly effective learning environments using adaptive learning*2 and otheradvanced techniques (FY2021)●●

Settlement and financial transactions: 6.0 trillion yen (FY2021)●●• Promoting measures to hire 200 female line managers (by the end of FY2020)• Building a framework for supporting women’s advancement across the KDDI Group●

Percentage of newly hired female graduates: 30% (by the end of FY2020)●

Disability employment rate: statutory rate achieved● *3

As a leading company in promoting the professional advancement of elderly employees,
establish a foundation for promoting such advancement (FY2021 target)●

Healthcare management initiatives• Illness detection rate (legally mandated): 55% or less (target figure for FY2020 end)
• Rate of smokers: 18% or less (target figure for FY2020 end)●

Number of cases of human rights violation: 0* Human rights violation refers to abuse of human rights, such as power harassment, subject to disciplinary
action.

●KDDI Group Philosophy Study Session attendance: 100%●

Measures for instilling the KDDI Code of Business Conduct company-wide: 12 or more
per year●Collection rate of sustainable procurement surveys: 90%●

KDDI Smartphone & Mobile Phone Safety Classes, Comprehension Rate, Satisfaction Rate
• For youths: satisfaction with lecturers: 99%; desire to reapply: 85%; launched a newlecture style•For older people: comprehension rate: 86%; usage rate: 92%●

7% reduction in CO2 emissions in FY2030, compared to FY2013 for KDDI (in Japan,
non-consolidated).

●

Maintain zero emissions from retired telecommunication facilities
Final disposal rate: 1% or less (Zero emissions is defined as having a final disposal rate of
1% or less)●Upgrading to highly energy-efficient data centers in Japan and abroad●

Maintain material recycling rate of 99.8% for post-consumer mobile phones●

Post-consumer mobile phones collected over 5 years (aggregated): 6 million (Target for
FY2018-FY2022)●●*1 Number of mobile connections: Number of activated SIM cards (GSMA’s “Mobile connections, including licensed cellular IoT”) We have revised upward the FY2021 target.
*2 Adaptive learning: The provision of study materials and learning methods optimized for each individual, based on each student’s level of understanding and progress.
*3 Includes KDDI Challenged (special subsidiary) and KDDI Engineering

KDDI Sustainability Report 202035

Top Message

Message from Executive Officer of Sustainability

Materiality 1KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Safer and More Resilient Connected World• Resilience to extreme weather events • Risk management

Network Quality Management and ImprovementKDDI’s ApproachKDDI Group

Social Issue
In an advanced information society, communications services are themost essential lifeline. The disruption of this lifeline due to a natural disaster can be a major factor behind a downturn in society and theeconomy itself. We at KDDI believe we are responsible for supporting
local communities where people can live with peace of mind by continuing to offering reliable communications services 24 hours a day,365 days a year.

Management Framework
The ongoing provision of a stable, resilient, high-quality telecommunications environment helps maintain lifelines and creates a foundation for a safe and secure information-based society. KDDI has been
defined as a designated public institution under the Disaster
Countermeasures Basic Act. To ensure our ability to provide stable
information and telecommunications services under any circumstances, we formulated a disaster policy in the form of a BusinessContinuity Plan (BCP) for Large-Scale Disasters, established a system for dealing with various disaster scenarios, and launched initiatives to, for example, ensure rapid relief for areas affected by disasters, in cooperation with relevant organizations.
 DDI maintains and operates many telecommunications facilities,
K
including optical cables and mobile phone base stations, via technicalcenters located throughout Japan.
 he operations centers in KDDI Building at Shinjuku (Shinjuku-ku,
TTokyo) conduct centralized monitoring of network conditions nationwide 24 hours a day, 365 days a year. In the event of an outage andother failures, these centers appropriately control communications,working with maintenance departments throughout Japan.

FY2020 Material KPIs

Web Link

PolicyOur Risks and Opportunities
Our corporate value could drop if we fail to provide our communications services for any reasons, even because of natural disasters.
 e believe that providing communications services continuously inWthe midst of unforeseen events to support society and the economy
is our responsibility and will result in the rise of our company value.

 o ensure high-quality and reliable network service, we build, anaTlyze and improve our facility operating system in line with our stringent standards.
 ike elsewhere, the global consumer business in Myanmar andL
Mongolia faces the same demand for reliability in telecommunications. Even in regions where the social infrastructure is not as wellestablished as that of Japan, we are rolling out operational knowhow and management methods developed in Japan with considerations to individual nation’s needs to ensure that customers can expect reliable, uninterrupted service 24 hours a day, 365 days a year.
Moreover, to improve the reliability of our systems and networks, wehave established design standards that include redundancies. We
are actively working to enhance our technological capabilities related
to maintenance and operations. In addition, we have measures inplace to protect systems and customers from various security
threats and apply KDDI standards to environmental upgrades tocounter external and internal security threats.

KDDI’s ApproachKDDI Group(management and improvement of network quality)

PolicyOur mission as a telecommunications operator is to ensure a communications
environment where customers can use mobile phones and smartphones
easily anytime anywhere. KDDI will offer safe and secure communications
services by engaging sincerely in every operation from quality management
and improvement of communications infrastructure, such as mobile phonebase stations and switching equipment for fixed-line phones, to building
next-generation networks.

Network Service Quality
Management System

KDDI

SystemKDDI owns telecommunications facilities, including optical cables andmobile phone base stations, which it maintains and operates via technicalcenters located throughout Japan.
The operations centers in KDDI Building at Shinjuku (Shinjuku-ku,
Tokyo) conduct centralized monitoring of network conditions nationwide
24 hours a day, 365 days a year. In the event of an outage and otherfailures, these centers appropriately control communications, working withmaintenance departments throughout Japan. To ensure high-quality andreliable network service, we build, analyze and improve our facility operating system in line with our stringent standards.
Aiming for zero serious accidents, we at KDDI hold 20,000 training
sessions each year. Our work procedures are based on the ideas ofcapacity design of telecommunications equipment, functional redundancy,
distributed arrangement of facilities and functional safety.

PLAN (Aim & Standard)
Establish and update product quality and quality standards(Quality of planning, design, compliance, and operation)

KDDI Group

PolicyDO
Build facilities based on product quality(Network building, monitoring equipment, operation system, etc.)

FY2020 Material KPIs

Moving Forward

KDDI Group

PolicyEnhance response to areas affected by an earthquake occurring directly beneath the Tokyo Metropolitan Area and measures for business continuity
Strengthen collaboration with Group companies
Improve each disaster response staff’s skills

CHECK
Analyze customer satisfaction with quality standards(Availability rate, failure rate, customer satisfaction, etc.)

Frequency and Duration of
Network Interruption

KDDI

System

In the event that network failure or maintenance causes any inconveniences
to our customers’ communications, we will make notice about it on the
failure and maintenance information page at our website.

Web Link

Failure and Maintenance Information (for corporate customers) (Japanese only)

Web Link

Failure and Maintenance Information (for personal customers) (Japanese only)

Expansion of Service Areas(Base Station Facilities)

KDDI

PolicyOur mission is to offer a stable call and data transmission environment
around the clock with a motto of “connecting and protecting lives, connecting day-to-day lives, and connecting hearts and minds.” We will aim
to build a 5G telecommunications network together with au 4G LTE communications network (800MHz platinum band) across Japan to provide amore comfortable telecommunications environment. The 5G service,
which provides an advanced telecommunications environment of low latency and high capacity, is much anticipated by many of our customers.
We plan to roll it out in regions as well as major cities. We will strive tooffer au mobile phone and smartphone users a reliable communications
environment in crowded areas as well as airports, commercial facilities,
event halls, and other in-house spaces.

Building Mobile Phone Base Stations andCare for Neighbors

KDDI

SystemTo offer a reliable communications environment to au mobile phone andsmartphone users, KDDI sets up mobile phone base stations in all parts ofJapan to support new services and improve service area quality for ourcustomers’ safe and comfortable life. When designing and building a new,safe and reliable base station, we observe the Radio Act, Building Standards Act and other relevant laws and regulations as well as municipal
ordinances and guidelines. The installation work is carried out by an experienced, designated construction company under a thorough safety management scheme. In cases where the construction is expected to cause a
nuisance or inconvenience to the residents in the neighborhood due to anincrease in construction vehicle traffic and noise, or if we receive inquiries
about the base station, we share general information about the base station and explain about the construction work to ensure their understanding and cooperation.

ACTION
Initiatives
KDDI Sustainable Action P.12 - 29
Network Quality Management and Improvement
Disaster Preparedness P.40 - 41
Initiatives Outside Japan P.42 - 43

36

KDDI Sustainability Report 2020

KDDI Group

PolicyImprove items that fail to meet quality standards

P.37 - 39

KDDI Sustainability Report 202037

Top Message

Message from Executive Officer of Sustainability

Materiality 1KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Safer and More Resilient Connected World• Resilience to extreme weather events • Risk management

Network Quality Management and Improvement

Safety of Radio Waves
KDDI’s Approach (policy)
In compliance with the laws and regulations related to radio waves, we at
KDDI offer our mobile phones and operate our mobile phone basestations in Japan at an electromagnetic wave level below the limits set at
the Radio Radiation Protection Guidelines (RRPGs).
SystemJapan’s Ministry of Internal Affairs and Communications established theRadio Radiation Protection Guidelines (RRPGs), which serves as a standard in the use of radio and TV waves and introduced regulations basedon these guidelines. The RRPGs, equivalent to the international guidelines
advocated by the World Health Organization (WHO), set the limits basedon the results of studies conducted across nations with safety factors fully
taken into account. It is commonly acknowledged among experts from
WHO and other international institutions that electromagnetic wave exposures below the limits will not have any known consequence on health.
We at KDDI take great care to ensure that the radio waves from ourmobile phone base stations poses no threat to safety. We design, build,
maintain and periodically inspect our base stations in strict compliancewith the relevant laws and regulations, including the RRPGs, stipulated in
the Radio Law and the Building Standards Act, as well as local government ordinances. We also explain to residents in local communities thatthe radio waves transmitted from our base stations comply with RRPGs
standards.
In addition, we offer mobile phones that comply with the permissible
values for radiation strength and absorption by the human body stipulated
in radio-wave-related laws and regulations while disclosing that information on our website.

Web Link

38

KDDI Group

Research That Ensures the Safety of Radio Waves
In November 2002, KDDI began conducting joint experiments with NTT
DOCOMO Inc. and Soft Bank Corp., using human cells to evaluate theimpact of radio waves for mobile phones on living organisms. Some results of the experiments were published in an interim report in 2005, andthe final report issued in 2007 concluded that radio waves for mobile
phones have no confirmed effect on living organisms at the cellular level orgenetic level. This research serves as an example of scientific evidence
that refutes claims that radio waves may cause cancer affecting cell structure and function. It also reaffirms the safety of radio waves emitted frommobile phone base stations.
KDDI also cooperates with electromagnetic environment committee ofthe Association of Radio Industries and Businesses (ARIB) in their researchand study on safety of radio waves for mobile phones.
We will continue to actively collaborate with relevant organizations on research and testing on impacts of the radio wave frequencies used for mobile phones on the human body and on medical equipment. We also strive
to stay updated about trends in research on safety of radio waves for mobile phones in Japan and abroad.
In addition, we will continue providing information about the safety ofradio wave frequencies used for mobile phones on our website and othersources. When constructing mobile phone base stations, we make sure toprovide adequate explanations in response to inquiries from local
residents about radio waves safety to ensure their understanding and cooperation.
Organizations to which KDDI Belongs or Is Giving Its Cooperation
Affiliation

Electromagnetic environment committee of Association of Radio
Industries and Businesses (ARIB), Electromagnetic Compatibility
Conference Japan

Affiliation

The National Institute of Information and Communications
Technology (NICT) / EMC-net
Study Group on the Evaluation of Human Exposure to Electromagnetic Fields

Affiliation

Japan national committee of the IEC / TC106 (Methods for theassessment of electric, magnetic and electromagnetic fields
associated with human exposure)
Working Group on the Evaluation of Electromagnetic Fields
around Base Stations

Researchcooperation

Mobi-Kids Japan (study investigating the effects of mobile
phones on health)

Absorption Rates of au Phones (SAR) (Japanese only)KDDI Sustainability Report 2020

Policy &SystemProviding a Convenient Usage
Environment: Signal Support 24

KDDI

Activity

As part of detailed quality improvement efforts for each customer, we offer
Signal Support 24, an after-sales support service concerning signal-related problems, for all customers using au mobile phones.
In this service, KDDI staff visit the homes of customers who haveinquired about signal quality and examine the reception conditions for au
mobile phones. We contact the customers to set up an appointment
within 24 hours of their inquiry, and then visit to check the signal andimprove the signal quality using au Femtocells or au repeaters. We accept
inquiries about signal quality not only in homes but also outdoors and in
offices and restaurants.
In fiscal 2019, we conducted approximately 26,000 site surveys andproposed measures to improve signal qualities based on them.
Going forward, we will strive to further improve customer satisfaction
with our services so that customers think “I’m glad that I chose au.” andexpand our service coverage.

Web Link

Signal Support 24 (Japanese only)

Approach to Next-Generation
High-Speed Communication

KDDI Group

PolicyThe mobile network that supports communication on smartphones andmobile phones has evolved from the first generation (1G) to the fourth
generation (4G) together with changes in the times and lifestyle. We
conducted research and development of the next-generation mobile
communication system “5G” with an aim to provide communications
services with greater stability and higher speed to customers and promote
dramatic development of ICT network infrastructure, and on March 26,
2020, we launched the “au 5G” service.
5G networks are capable of higher speed and capacity, low latency
and many simultaneous connections. By connecting everything via networks, beginning with smartphones and mobile phones, we will continue
helping to build Society 5.0 (a creation-based society) as we create newservices and solve social problems.
Based on its advanced 5G and robust 4G hybrid network and incollaboration with its partners in various industries, KDDI delivers tocustomers a new and unprecedented expanded experience, called“AUGUMENTED EXPERIENCE,” in an array of everyday situation such asentertainment, sports, and art. We contribute to developing and expanding our corporate customers’ business by supporting their digital transformation (DX) through leveraging our IoT / ICT related technologies andexpertise, as well as deploying a business model that helps create new
business opportunities through open innovation with our partner companies so that we can grow together. Focusing on KDDI DIGITAL GATE,
which is a business development base for the 5G / IoT era that supports
customers’ DX, we will work with diverse partners as a digital integrator
for this era, in which telecommunications are becoming seamlessly integrated with all kinds of physical things, to advance the creation of new
experience value and businesses only possible in the 5G era.

Advancing Research on 5G

KDDI Group

Activity &Results

With the evolution of devices and the proliferation of IoTs, mobile networks
are required to perform at much higher levels than expected before. KDDIwill work on demonstration experiments with its partner companies topursue business opportunities beyond industrial borders and fields ofbusiness through the fifth-generation mobile communications system “5G”
with high speed, high capacity, low latency, and massive device connectivity.
We will actively roll out 5G services as basic next-generation infrastructure,develop businesses through co-creation with various partner companies,
and promote open innovation that incorporates the innovative ideas andadvanced technologies of start-ups. In this way, we will create new experiential value and actively utilize 5G services for regional revitalization businesses.
In February 2020, we conducted a 5G experiment jointly with
Obayashi Corp. and NEC Corp. as part of the 5G Comprehensive Demonstration Test led by the Ministry of Internal Affairs and Communications at
a construction site of the Kawakami Dam in Iga City of Mie Prefecture,
which successfully demonstrated the 5G’s ability in road construction. The
technology enabled remote operation of three construction machines, simultaneous operation of a vibration roller equipped with an automatic operation system, and real-time acquisition of construction, proving that it isapplicable to the construction of general roads. Going forward, it is expected to help reduce time to site and man-hour.

5G Testing Initiatives

Web Link
Web Link

5G Co-Creation and Transformation —5G Research with Partners
Creating Businesses of the Future— (Japanese only)KDDI Sustainable Action

Providing Service Environment
outside Japan

KDDI

Activity

The users of au smartphones and mobile phones can enjoy our voice anddata communications services in 150 or more countries and regions
around the world, including the World Data Flat service, which provides adata service at a flat rate. This is realized based on the partnerships withoverseas telecommunications operators that we have cultivated in thecourse of providing international telephone services for more than 65
years.
Starting from February 2020, an early booking discount is applicableto the World Data Flat service when the service is booked in Japan before
departure. No prior settings are required when using the service overseas.
KDDI will strive to continue to provide an environment where users canuse our communications services securely and comfortably outside Japan.

Web Link

The World Data Flat service

KDDI Sustainability Report 202039

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 1

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Safer and More Resilient Connected World• Resilience to extreme weather events • Risk management

Disaster PreparednessKDDI’s Approach (disaster preparedness)

KDDI

PolicyAs a designated public institution under the Disaster Countermeasures
Basic Act, we have formulated a business continuity plan (BCP) forlarge-scale natural disasters as an emergency response policy to ensure
the stable provision of telecommunications services at all times under any
circumstance. We are working to build an organizational structure capableof responding to different types of disasters and implementing a suite ofmeasures in partnership with various relevant organizations.

Business Continuity Planning

KDDI

Policy &SystemOur BCP for large-scale natural disasters is based on the principles of
ensuring the safety of our employees and their families, performing our
responsibility as a designated public institution to ensure the continuity oftelecommunications services and supporting our stakeholders. It
stipulates a range of measures that cover different stages, from the initial
response at the occurrence of a disaster through full-scale restoration torelief activities in the affected areas.
The effectiveness of the BCP is assessed during the twice-yearlydisaster preparedness drills, and any issues identified in the exercise are
addressed. An annual PDCA cycle is applied in the ongoing effort tostrengthen the foundation of our emergency response structure further.
▪ Disaster Response Framework
Disaster Response Headquarters
Chief of Disaster Response
Headquarters:
Company President

Secretary General:
General Manager,
General Administration department

Staff members nominated by divisions

Operational Response
OfficeInformation Systems
Response OfficeOn-site Response
OfficeEstablishing a Disaster Response Headquarters in Times of DisasterNatural disasters are unpredictable and can strike any time. We havedefined the criteria for establishing a Disaster Response Headquarters inadvance to act proactively in the event of a natural disaster that meetsthese criteria.
In the event of the Disaster Response Headquarters being established,
it will be headed by the President. The headquarters will maintain close
communication and work in cooperation with local response offices tolead our efforts to restore damaged networks and facilities as quickly as
possible, support the customers in affected areas and offer aid toemergency shelters.

40

KDDI Sustainability Report 2020

Action against Pandemic Influenza

KDDI

SystemBased on the Guidelines for the Prevention and Control of Pandemic
Influenza approved in February 2009 at the council on countermeasuresrelated to pandemic / avian influenza, we formulated the Plan for Maintaining Company-wide Operations in the Event of an Outbreak of a New Strainof Influenza to ensure employees’ health as well as appropriate responses
so that we can maintain the communications services for our customers in
the event of an outbreak of a pandemic influenza.

au Disaster Recovery Support System

KDDI

SystemTo get a quick understanding of the situation during a disaster and formulate an appropriate recovery plan, we have deployed the au Disaster Recovery Support System at ten technical centers in Japan. The systemprovides centralized management of information about regional damage,
conditions at key sites and emergency shelters and evacuation routes.
This information is reflected on maps in real time to identify high-priority
areas, enabling us to provide effective recovery response even when thedamage is widespread.

Facility Systems for Securing Communications
Services in Times of a Disaster

KDDI

SystemMulti-Route Core Transmission Lines and Route Distribution
To ensure stable communications, we distribute telecommunications
equipment capacity and establish dual communication lines (terrestrial
optical fiber) as well as the system that uses automated switching tosecure communications network when there is a failure. Submarine cables
are also used to provide multiple communication lines, ensuring a highly
reliable network. In the event of trouble, bypass measures are implemented
to secure communications.
Enhancing Disaster Resilience in Communication Stations and
Telecommunications Facilities
We have augmented the deployment of power supply vehicles and emergency power generators to make possible the immediate supply of power
to telecommunications facilities in disaster areas. Furthermore, to ensurecommunications services in disaster-hit areas, we reinforced the wirelessentrance network as well as vehicle-mounted and portable base stations
and equipped around 2,200 mobile phone base stations with batteriescapable of operation for 24 hours or longer.
Temporary Base Stations
The KDDI group owns a cable laying ship equipped with a base stationthat provides mobile phone services during disaster situations when there
is no land-based base station that can provide coverage. Going forward,
we will conduct repeated demonstration tests on drone base stations withthe aim of providing mobile phone services from the sky during disastersituations.

Providing Disaster Response Services
Service nameau Disaster
Response App

Disaster Message
Board Service

Emergency EmailServiceKDDI

Activity

Content
Disaster Message Board Service, Emergency Email Service,
Disaster Voice Message Service, Disaster Information

Web Link

au Disaster Response App (Japanese only)

A service that enables safety confirmation at times oflarge-scale disaster

Web Link

Disaster Message Board Service

A service that sends disaster and evacuation information
provided by national and local governments, special weatherand eruption-related warnings, tsunami warnings andearthquake early warnings to all au mobile phones in theaffected area

Web Link

Emergency Email Service (Japanese only)

A service that delivers voice messages for safety confirmation
using the packet communication network in times of disaster
Disaster Voice
Messaging Service
Web Link Disaster Voice Messaging Service

Service Trial

Customers can try using the disaster message board service
and the disaster voice messaging service
Trial Period:• 1st day and 15th day of the month (0:00-24:00)• 1st to 3rd day of January (January 1 at 12:00-January 3 at
24:00)• Disaster Preparedness Week (August 30-September 5)• Disaster Preparedness and Volunteer Week (January 15-21)

Collaboration with Disaster-related
Organizations during Normal Times

KDDI

Activity

We at KDDI are actively involved in emergency preparedness events
organized by national and regional governments and emergency drills
held in partnership with various coordinating organizations.
At emergency preparedness events, we focus mainly on informing theresidents about the emergency services we offer at times of disaster, suchas the disaster message board service, and on disseminating emergency
preparedness information. We also work with the Japan Self-Defense
Forces, local authorities and other relevant organizations to organize
emergency drills, where we make the most of participating organizations’
strengths to recreate highly realistic disaster situations. These internal andexternal drills test the effectiveness of our disaster response so that we
can review and improve our preparedness.

Web Link

KDDI Initiatives (Disaster Relief & Support)

KDDI Sustainability Report 202041

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 1

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Safer and More Resilient Connected World• Resilience to extreme weather events • Risk management

Initiatives Outside Japan
KDDI’s ApproachKDDI Group(initiatives in growth markets outside Japan)

PolicyWe believe expanding information and communications services inemerging countries is key to solving various social issues. Further expansionof global business is one of our business strategies. We strive to offer
emerging countries with stable communication quality, utilizing our
experience, expertise, and technology of telecommunications services
that we have cultivated in and outside Japan, aiming to achieve higher
quality of life and economic growth in those countries. In addition, theKDDI Foundation also supports the building of communication infrastructure
in developing countries where we don’t operate our business.

Web Link

KDDI Sustainable Action

Web Link

Material Issue 3 Fulfilled Life Brought through ICTs

ICT Solutions outside Japan

KDDI Group

Policy &SystemKDDI provides a variety of one-stop solutions for customers’ operations,
including data centers, cloud computing, networks, and IoT services.
We have established more than 40 TELEHOUSE data centers in 10 or morecountries. The data centers have garnered acclaim for their service quality
and reliability in around 30 years of operational experience as well as theirhigh connectivity, which brings together world-class internet exchange (IX)
providers, telecommunications operators, and cloud-computing operators,
and more. In addition, TELEHOUSE data centers are equipped withhigh-capacity electric power and incorporate the latest energy-saving
facilities, such as highly efficient and reliable power supply equipment,
energy-efficient air conditioning, LED lighting and outdoor lighting thatuses wind and solar power. The data centers are used by manycustomers as a platform for global business.

Maintenance andOperation of Global Network

Web Link

KDDI Sustainability Report 2020

Policy &SystemWe connect networks with communications providers around the world,
and, in cooperation with these companies, we maintain and operate a
global network linking different parts of the world. We not only provide
high quality international communications services using highly reliable
optical fiber submarine cables but also new platforms such as Connected
Cars.
Submarine cables provide 99%* of Japan’s international traffic, being
an important component of the social infrastructure. Moving forward, we
will offer even more reliable communications services for the Asia andPacific regions, where demand is expected grow further.
One of the newest international submarine cables that KDDI is laying
is the Southeast Asia-Japan 2 Cable System (SJC2), an optical fiber
trunk connecting Japan and Singapore. We signed a construction andmaintenance agreement for the cable network with Facebook (U.S.), China Mobile International (China), Singtel (Singapore), and other telecommunications operators in Asia, and the construction is now under way.
In September 2019, KDDI Cable Infinity, a new submarine cable-laying
vessel started operation for the SJC2 and other projects, laying cables
underwater and connecting them to land lines. As well as promoting IT
innovation in marine vessel and offshore construction operations, we
endeavor to build and maintain a highly reliable global infrastructure using
the high-performance undersea cable technology owned by the KDDI
Group.New services are developing at a global scale on trunk networks
connecting Japan and the world, and IoT is one of the major global
technologies supporting them. KDDI and Toyota Motors collaborated
to build a global communications platform for connected cars, and the
Global Network Operation Center (“GNOC”) started operating the platform in 2019
In addition, through partnerships with companies such as Inmarsat
and Intelsat, the GNOC offers services using satellite communications,enabling call and data transmission to anywhere in the world, such as
ships at sea, airplanes, the South Pole and other remote areas andislands where cables do not reach, thereby insuring secured global
communication around the clock.
* According to research by KDDI

42

KDDI Group

Inmarsat Service (Japanese only)

Business Expansion in Myanmar

KDDI Group Activity

We are working together with Myanma Posts & Telecommunications(MPT) and Sumitomo Corporation on a joint venture aimed at establishingan optimal communications environment in Myanmar, where there is anurgent need to improve the communications infrastructure. Althoughmobile phone penetration in Myanmar was around 10% before the launchof the joint venture, a nationwide expansion of service coverage enabled
people in the country to enjoy internet access and watching videos on asmartphone.
Since July 2017, we have been running a long-term training program
for the MPT workers who will one day be leaders to improve customer
satisfaction and the quality of communications services in Myanmar. As partof the program, KDDI staff working on the business frontlines in Japan help
Myanmar trainees gain technical knowledge and know-how that KDDIhas developed over many years of experience in the telecommunications
business in Japan, where its high-quality network offers 24 hours a day,365 days a year. The training covers a wide range of subjects; everything from the design and construction of transmission systems and optical networks to their operation, initiatives aimed at enhancing reliability,
disaster response measures, and even the development of advanced information systems.
Sales-and business-related trainees study sales, marketing strategies, customer experience (CX), the basics of life design services, financial accounting, management accounting, and more. After returning to
Myanmar, the trainees will continue to use the skills they have gained inJapan to contribute to Myanmar’s growth.
We have accepted a total of 12 trainees from the country since 2017.
We will continue running this program going forward.

Business Expansion in Mongolia

Initiatives of the KDDI Foundation

KDDI Group Activity

Building an optical fiber network with a simplified construction in
Mongolia, a land of extreme cold
Local networks were established in Mongolia using optical fiber cables
that are easy to install and operate. The networks built with a simple
structure and at low cost were set up at three locations: Terelj, a tourist
spot in the suburbs of Ulaanbaatar, the capital of Mongol; Arkhangai
and Bayankhongor some 600 km away from the capital. A test was
implemented to ensure the durability of the optical fiber cables inextreme weather conditions where the external temperature goes down
to minus 40 to 50 degrees Celsius. Going forward, the networks will be
used for medicine, administration, and education as well as enhancementof tourism focused on sightseeing resources nearby, thereby contributing
to regional revitalization.

Web Link

KDDI Foundation

KDDI Group Activity

KDDI’s consolidated subsidiary MobiCom Corporation LLC started a highspeed data communication service by carrier aggregation in November
2017—the first of its kind in Mongolia. The company is endeavoring toprovide an optimal data communication environment to its customers in
Mongolia by improving service quality and introducing new technologies inan effort to improve customer satisfaction and to grow its business.
KDDI has accepted a total of eight trainees from MobiCom since 2018as part of its resource exchange program to provide them with training on
corporate sales and marketing as well as security systems. Through theexchange of personnel, we contribute to enhancing telecommunications
business in Mongolia.
Since 2017, KDDI PRECEDE (the company in charge of operating
KDDI’s directly managed stores) has provided MobiCom shop staff withtraining on customer interaction and also offered on-the-job training attheir shops to improve their customer service and hospitality skills, striving
to support for the improvement of customer satisfaction beyond nationalboundaries.

KDDI Sustainability Report 202043

Top Message

Message from Executive Officer of Sustainability

Materiality 2KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 1

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Cyber Security and Privacy Protection• Utilization of information assets and tightening of security • Data privacy

Cyber Security and Data Privacy Protection
KDDI’s ApproachKDDI Group

Social Issue
Recent years have seen leaks of important confidential informationworldwide due to cyberattacks employing software viruses, a situationthat has become a major social issue. We consider the personal andbusiness information that the KDDI Group retains for its customers andbusiness partners to be extremely important assets that need to be
managed with strict confidentiality.

PolicyOur Risks and Opportunities
C ustomer data leaks from inside the company or unauthorizedaccess from outside could seriously damage the brand image of theKDDI Group. In addition to a possible loss of customer trust, we
could also be forced to pay substantial compensation, which could
have a negative impact on our financial position and businessperformance.
 e may face higher costs to enhance the confidentiality of commuW
nications and privacy protection systems in the future.
 here are new market opportunities where demand is growing, suchTas safe apps and global cyber security services.

Management FrameworkAs a telecommunications operator, we are committed to protecting
the confidentiality of communications. In order to protect customer
data, we have set up the Information Security Committee and areworking on the development and implementation of company-widemeasures to prevent data leaks from within the company as well as
unauthorized access from outside.
 lso, with the implementation of the KDDI Code of Business ConA
duct, KDDI Security Policy, and KDDI Privacy Policy, and the establishment of the KDDI Group Business Ethics Committee, the KDDI
Group is working to further strengthen its information security governance.

 e also have strengthened the technical, organizational and humanW
aspects of our suite of security management measures. These
include tighter control and monitoring of access authorization for ourcustomer data systems, safekeeping of access logs and a ban on
taking company data outside company premises or saving it toexternal memory. In order to promote awareness, we provide ongoingtraining on the confidentiality of communications and protection ofcustomer data for all our employees. We are also working with our
external partners, particularly with our retail network of au Shops, tostrengthen our value chain management through the improvementof shop operations, monitoring and training.

KDDI’s ApproachKDDI Group(Cyber Security and Data Privacy Protection)

With the increasing prevalence of smartphones and the rapid progress oftechnologies such as big data and AI in recent years, new services thatmake use of various kinds of personal information are being considered.
At the same time, however, these changes have also highlighted many
issues surrounding privacy, and governments are reviewing their laws andregulations.
To ensure that it uses personal data while protecting privacy, KDDIhas published its privacy policy and its handling of personal information,
including types of information to collect, purpose of use and the requirement of a customer’s consent, and thus completely protects such personal information. In addition, in January 2020 we set up “Privacy Portal” toprovide clear explanation about KDDI’s use of customers’ information,
ensuring the transparency while deepening customers’ understanding.

Web Link

Privacy Policy

Web Link

Privacy Portal (Japanese only)

Web Link

PolicyFY2020 Material KPIs

Management
Level

KDDI Group44

KDDI Sustainability Report 2020

Security Policy

Information Security Committee (Management Level)
Committee Chair: Executive Director, Technology Sector
Secretariat: Internal Control Department, Information Security Planning Department, Data Governance Office(3) E stablish and manage regulations relating to information security
including the Security Policy

Information Security Promotion Meetings
Chair: General Manager of the Information Security Planning Department

KDDI

Group companies
Persons in charge of
information security(KDDI)

Persons in charge of
information security

Department
Level

KDDI Group

Investment Management Division(General Managers,General
Branch President))(Department Managers)

P.45 - 47

Web Link(2) Determine and implement group-wide measures to defend against
attacks and invasion from external networks

PolicyMake the best use of data assets
Further improve security
Protect data privacy

Cyber Security and Data Privacy Protection

To ensure a unified approach to the security of information assets acrossthe group as a whole, we have established the Information Security Committee chaired by the Executive Director, Technology Sector. The committee comprises the management level, along with the general managers ofsales, technology and corporate divisions.
Currently, the committee is chaired by Kazuyuki Yoshimura, Executive
Director, Technology Sector. Under this framework, we accurately grasp
the status of information security management and promptly implement
measures to enhance the information security throughout the group.

(1) Determine and implement group-wide measures to prevent internal
information leakage

Division /Regional
Office Level

Initiatives

KDDI Group System

Role of Information Security Committee

KDDI GroupMoving Forward

Information Security Management
Framework▪ Information Security Management StructureIn order to ensure the security of customer data, au Smart Pass
apps and all other customer apps provided by KDDI are examined
to verify that their behaviors are in line with KDDI Group Smartphone
Apps & Privacy Policy Management Guidelines established in April
2019. As a member of the industry body the Japan Smartphone
Security Association (JSSEC), KDDI is taking part in data security
initiatives.

FY2020 Material KPIs

PolicyInformation security
managers

Group companies in Japan

Group companies overseas

Persons in charge of
information security
promotion

PolicyPersons in charge of
information security

Persons in charge of
information security

KDDI Sustainability Report 202045

Top Message

Message from Executive Officer of Sustainability

Materiality 2KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 2

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Cyber Security and Privacy Protection• Utilization of information assets and tightening of security • Data privacy

Cyber Security and Data Privacy Protection

Strengthening Information Security
throughout the Company

KDDI Group

Policy &SystemAll KDDI Group companies have been ISMS 27001* 1 certified since2009. For our group companies, the KDDI Group Information Security
Standards were introduced in fiscal 2011. In fiscal 2017, we revised thestandards and extended them to apply to all group companies. Augmenting
the improvement in the security level of KDDI Group companies resulting
from this change, we regularly audit the security level of group companies
in an ongoing effort to strengthen the information security governanceof the KDDI Group as a whole. Also, KDDI Digital Security Inc. wasfounded in February 2018, and the company’s specially trained security
engineers now respond to cyberattacks.
*1 ISMS certification (ISO/IEC 27001: 2013) A third-party conformity assessment scheme for information security. It was established with the goal of contributing to widespread improvements
in information security and encouraging companies to target levels of information security thatcan be trusted around the world.

▪ ISMS Certification KDDI Acquired
Registration
numberOrganization

Initial registration

IS 95253

KDDI Corporation*2

June 7, 2005

IS 76406

KDDI Corporation(Operations Division)*3

July 4, 2003

IS 85329

KDDI Corporation(Information Systems Division)

September 28, 2004

*2 Includes corporate, technology and sales and customer support divisions, as well as KDDI
Kyosaikai (now KDDI Group Welfare Association), KDDI Health Insurance Union, KDDI Pension
Fund, and KDDI MATOMETE OFFICE CORPORATION.
*3 Includes Japan Telecommunication Engineering Service Co., Ltd.

Basic Principles Concerning the Handlingand Use of Personal Data

KDDI Group

PolicyWe have implemented internal rules for the handling of customers’
personal data and use of big data in line with the Act on the Protection of
Personal Information and other related laws and regulations. We obtain,
manage and use such data in accordance with our privacy policy.
We also stay informed of and comply with security related laws andregulations of foreign countries. Our subsidiaries located in the EU as wellas the KDDI head office already comply fully with the EU General Data
Protection Regulation (GDPR), which came into effect in May 2018.

Efforts to Reduce Information Security Risks

KDDI Group

System &Activity

Our efforts to minimize information security risks include preventing customer information leaks and defending against cyberterrorism. The Information Security Committee leads the management of all company information assets and formulates measures that officers and employees canimplement together. The committee is part of our corporate governanceframework, which manages risks for the whole group.
In FY2019, in order to eradicate information security accidents, wetook measures to strengthen information security in a way to encourage
each department to autonomously raise the information security awareness, aiming to raise the awareness among directors, officers and employees.
Furthermore, we have implemented common security standards forthe entire group and apply them to all group companies to manage all our
information assets and strengthen the various measures that are in place
to control specific information assets. To minimize security risks, persons
in charge of information security promotion from KDDI and group companies hold regular meetings to share information and discuss security measures.
To tackle increasingly sophisticated, complex information security
threats, we also need to collaborate with external parties. We are actively
involved in cross-industry initiatives related to information security.

▪ FY2019 List of Initiatives and Activities for Reducing Information
Security Risks

Organizations We Join
• ICT-ISAC Japan• Forum of Incident Response and Security Teams (FIRST)• N ippon CSIRT Association (Nippon Computer Security Incident
Response Team Association)

Total Information
Security• E-learning training• Training for new department general managers• Walk-around security check•E nhancement of raising information security awareness•E nhancement of checking authorization to access customer
information• Internal security audits• Technical audits of subcontractors’ OA environments andsystems in addition to general audit items• Confirmation of compliance with information security rules
for the whole group• Information Security Promotion Meetings for the wholegroup• C ontinuing supervision of OA environment in the wholegroup

Prevention of
information leakage throughsocial media• Complying with Social Media Policy• Raising awareness among employees

Stronger control
measure for using
cloud computing• Complying with the company regulations relating to the useof cloud computing for the whole group• M aintaining and improving risk assessment framework
relating to security and legislation systems

Response to laws
and regulations• R esponding to the Amended Act on the Protection of
Personal Information• Complying with the company regulations in line with the EU
General Data Protection Regulation (GDPR)

Prevention ofe-mail mistakes• Prohibiting automatic forwarding• Automatic encryption of attached files in external e-mails

Measures against
targeted attacks• A nnual training against targeted e-mail attacks for
employees• E-learning training

Web Link

Next Generation Service Development

KDDI Group Activity

Research and Development of Security Measures for 5G Network Era
The 5G network comes with more additional functions to realize a scenario of high speed, large capacity, high reliability, low latency, and massive
devices being simultaneously connected. New solutions that have notbeen seen before are also introduced; such as virtualized network infrastructure, sharing of telecommunications functions with other operators,
and greater flexibility in configuration according to how a network is used.
A multi-vendor alliance building wireless access network, Open Radio
Access Network (O-RAN), is a typical example of such trend. Security of
5G core functions has been tightening through solutions to problems with
4G, though there are still concerns about potential security problems
attributable to newly introduced functions, different network configurationfrom current networks, open specifications, more complexity and so on.
KDDI, in cooperation with KDDI Research Inc., has been engaged inresearch and development, and application method of strengthening thesecurity of the 5G network as a whole. We will build a network platform inline with 5G Network Era and expand facilities to provide services basedon new functions. In doing so, we will study and offer security measuresand functions as required.

Other operators

Other operators

Non-trusted entity

GRX/IPX

2. Security between
operators

5. MEC Security

SEPP

Social Media Policy (Japanese only)

SBA
3. SBA Security

Edge
Non-trusted
entityNFV / Slice
4. Virtualization Security

Non-trusted entity

Trusted Environment
SEPP:Security Edge Protection Proxy
SBA:Ser vice Based Architecture

1. Threat derived from terminals

46

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

47

Top Message

Message from Executive Officer of Sustainability

Materiality 3KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality

Materiality 4

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Fulfilled Life Brought through ICTs
• Contribution to economic growth through robust information communication infrastructure • Improvement of access to education, medicine and other public services through ICTs
• Promotion of employment creation and capacity building • Innovation management

Regional Revitalization Initiatives
KDDI’s ApproachKDDI Group

Social Issue
In recent years, Japanese society is facing the decline in productivity
and shrinking regional economies due to the shrinking working-age
population because of the aging population with fewer children and theaccelerating rural depopulation because of the concentration of population in large cities. Under such circumstances, ICTs are expected to
be an effective tool to revitalize regional economies by alleviating labor
shortage and increasing high quality employment in regional areas.
While the wider use of ICTs improves convenience, there are concerns associated with it, such as the prevalence of mobile and smartphone use among children and the widening digital divide affecting
older people.

PolicyOur Risks and Opportunities
The decreasing working population and growing economic disparity
between regions are risks that could lead to a decline in the numberof users and a decrease in business income.
ICT-based solutions are expected to help alleviate shortages in thelabor pool and business successors through more efficient operations, automation, and remote operation. They are also expected tohelp rural areas take advantage of the opportunities to expand business activities that showcase local industries, cultural and natural
heritage, and communities, and revitalize their economies.
 n the other hand, offering smartphone devices and services thatO
help socially vulnerable people use the technology safely and easily,
combined with awareness campaigns, can be beneficial to KDDI’sbusiness as it can generate new demand.

Management Framework

Life Design

Technological Development and R&D

The technology and other divisions at KDDI Head Office lead our technological development, and we are working on innovative technologies
that will support our business in the near future, such as 5G, self-driving vehicles, and automatic operation. On the other hand, in researchand development, KDDI Research Inc. is engaged in a wide range offields, from research analysis for future prediction to basic research
and applied research.

In our consumer business, we enhance life design services, includingcommerce, finance, energy, entertainment and education centered on
telecommunications, and provide exciting experiential value to customers
We aim to achieve sustainable growth with customers in the corporate business by supporting their digital transformation and realizing
the integration of telecommunications and life design for corporate clients in Japan and overseas.

Regional Revitalization

Product and services

KDDI’s initiatives to use 5G and ICTs to solve regional problems aremainly driven by its Business Strategy Division’s Regional Revitalization
Promotion Department, and Business IoT Promotion Division’s Regional Revitalization and Support Office. We dispatched volunteers to municipalities affected by the Great East Japan Earthquake and are using
the insight and know-how gained by members who supported the area’s recovery.

We promote to apply universal design in developing our product andservices to ensure comfortable and enjoyable use for all regardless ofage, nationality and (dis) ability.

In addition to the initiatives of KDDI’s subsidiaries and affiliates, theKDDI Foundation conducts its own activities.

KDDI’s Regional Revitalization Project “Te to Te”
In 2019, KDDI launched its regional revitalization project “Te to Te.”By helping realize a community’s passion, hope, and business idea to drive
regional revitalization, KDDI will endeavor towork together to create “Community’s Future.”KDDI will support the community’schallenges by moving forward hand-in-handwith the community. That is our will, that is“Te to Te.”KDDI GroupMultilingual translation taxi
IoT mango cultivation
5G stadium testing
Drone logistics for remote islands
Bird and animal pest control
Tourism trends
Tourism VR

Local businesses / venture companies
Humana Resource
Development

Local education
organizations

Development andprovision of humanresources

Contribute to economic development through ICTs
Revitalize local economies(Create employment and enhance capacity building)Innovation management
Promote information literacy education

Initiatives

Hida City

Muroran City

Smart agriculture

ICT tourism

KDDI Sustainable Action P.12 - 29
Regional Revitalization Initiatives P.49
Innovation management P.50 - 52
Responsibility for Products and Services
Initiatives Outside P.55

PolicyGero City

Yokote City

Snowplow IoT / Regional development

Apple IoT

Toyota City
Kuwana City

Obama City

Smart scale

Tottori City

Smart drones

Minamisanriku-cho

ToyamaPrefecture

4K 360-degree remote shopping experience

Higashi Matsushima City

Manufacturing IoTCity-run Wi-Fi development

Kunimi-machi
Animal pest control

Hinoemata-muraAnimal pest control

Hirado City

Cashless translation

Shimonoseki City

Goto City

Job experience for kids

Nagano City

Tourism trends

Smart fishing

Ina City

Koganei City

Drone logistics

5G education

Iida City

Miyazaki City

Satsumasendai City

Kimotsuki-cho

Tourism trends and local goods sales channels expansion

Smart agriculture / crop-spraying drone

Sake brewing
Use of drones, 5G and 4K video

Otari-mura
IoT support for daily life Tablet education

Animal pest control

Nagashima-cho
Promotion of migration / high resolution VR

Aizuwakamatsu City

Nikko City

ICTs solution to problems unique to mountain village

5G drones, VR experience

Smart fishing / smart agriculture

Sendai City

Chizu-machi

Multilingual translation taxi

Smart agriculture

Information distribution platform

Toyooka City

Offshore currents detection

KDDI Sustainability Report 2020

Obihiro City
Kamaishi City

Smart fishing

Maizuru City

Policy &Activity

Basic tourism planning

Nagaoka City

VR ninja experience for tourists

Fukuyama City

P.53 - 55

Provision of funding

Kamishihoro-cho

Tourism trends and agriculture IoTKDDI Group

Business know-how for theera of digital transformation
Latest IT solutions

KDDI Group

Centrair Airport
Local goods sales
channel expansion
and marketing support

PolicyThe KDDI Regional Initiatives Fund (KRIF) is corporate venture capital(CVC) established by KDDI Corporation and Global Brain Corporation(fund operator) for investing in venture companies and local business that
promote regional revitalization.
Venture firms and local companies that are strongly motivated to solve
regional issues will play key roles in finding solutions to the various problems faced by local communities. Through the provision of various resources, technologies and know-how and a first round of support forthese companies from KRIF, KDDI will continue working to build a sustainable business model, both for the regions and for the companies.

Using ICTs to solve regional problems

Smart abalone farming

PolicyPolicy &ActivityKDDI GroupA sustainable business model for both the regions and the companies

Hamamatsu City

Outlying islands

KDDI GroupKDDI Regional Initiatives Fund andRegional Revitalization

Initiatives in Regions of Japan Using ICTs

Stimulation of industry

48

PolicyIoT child monitoring

FY2020 Material KPIs

Moving Forward

KDDI GroupRegional Human Resources Development Using 5G
KDDI utilizes various advanced technologies and network with our partnercompanies to support unique initiatives with our many stakeholders, including local governments, companies, NPOs and residents.
To realize sustainable regional revitalization, it is important to develop
businesses and human resources that locally support ICTs. We are working together with local educational organizations and other stakeholders tocreate an environment where people can learn know-how on the mostadvanced ICTs and corporate management by utilizing 5G network without leaving the area they live.

Okinawa Prefecture

Initiatives Outside Japan

FY2020 Material KPIs

Web Link

Approach to Regional Revitalization
Using 5G / IoT

Shimanami
Kaido
Kaiyo-cho
5G Drone

5G snowplow / Bus operation app

Atsugi City
Flood surveillance

AI, XR, automated driving

Smart oyster farming

Hakuba-mura

Ibaraki City

Gotemba City

Remote operations ofconstruction equipment

Visualization of climbers descending Mt. Fuji
VR / translation / drone(as of April 2020)

KDDI Sustainability Report 2020

49

Top Message

Message from Executive Officer of Sustainability

Materiality 3KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Fulfilled Life Brought through ICTs
• Contribution to economic growth through robust information communication infrastructure • Improvement of access to education, medicine and other public services through ICTs
• Promotion of employment creation and capacity building • Innovation management

Innovation Management
Approach to Innovation

KDDI Group

PolicyWe at KDDI aim to continue to provide new experience value in all aspectsof life, always focusing on our customers. As well as exploring the latest
technologies through research and development, we proactively promote
open innovation through collaboration with external partners and industry-academia-government collaboration, leading to the development of
products and services beyond our customers’ imagination.

Promotion for R&D andTechnological Development

KDDI Group System

We have organized a framework to promote both technological development for grasping technology trends in a timely manner and utilizing thelatest technologies for our business, and research and development
aimed at creating state-of-the-art technologies over the long term.
Our technology divisions at KDDI Head Office lead our technologicaldevelopment, and we are working on innovative technologies that will
support our business in the near future, such as 5G, self-driving vehicles
and automatic operation.
On the other hand, in research and development, KDDI Research Inc.
is engaged in a wide range of fields, from research analysis for future prediction to basic research and applied research. KDDI Research, Inc. isengaged in research and development in a wide range of fields, such as
network, IoT, AI x big data, security and service applications, and 308
researchers are engaged in R&D (as of April 1, 2020).

(Millions of yen)

23,72815,00024,007

20,13220,000KDDI Digital Gate
In September 2018, we launched KDDI Digital Gate, our business development hub for the IoT and 5G era in Toranomon, Tokyo to create new
business solutions with our corporate customers. In September 2019, we
expanded KDDI Digital Gates to Osaka and Okinawa, which have alreadybeen used by over 350 companies in total.
KDDI Digital Gate provides a KDDI development team and a project
room where prototypes can be developed rapidly with agile development
methodology; co-creation workshops are held to identify potential issues
and come up with innovative ideas through design-oriented thinking; andhands-on demonstrations and testing using various telecommunications
technology, including 5G and IoT, are conducted. KDDI will work with aprofessional group made up of highly specialized partners, aiming tospeed up the process of identifying needs, creating, learning and improving, helping customers to provide services with high market value to society as quickly as possible.

Web Link

KDDI DIGITAL GATE (Japanese only)KDDI Regional Initiatives Fund and Regional Revitalization

Web Link

KDDI Regional Initiatives Fund and Regional Revitalization

KDDI Group System
KDDI Open Innovation FundKDDI Open Innovation Fund is a corporate venture fund operated by KDDIand Global Brain Corporation that invests in promising start-ups acrossthe world. We strongly support the growth of our investee companies, using our broad networks with different companies and marketing skills, aswell as linking with our services.
In April 2018, we launched KDDI Innovation Fund No. 3.
We established an investment program to strengthen initiatives infields of increasing importance for the 5G era, including AI, IoT and big
data. Drawing on the technological and business insights and networks ofKDDI’s and KDDI group companies’ venture companies, we support
promising new venture companies. KDDI Open Innovation Fund No.3,
which is active as of May 2020, has invested approximately 20 billion yen
in total. The fund program will also make it possible not just for KDDI but
also for its group companies to proactively undertake joint development
efforts with venture companies.
We have specialist personnel based in San Francisco, the UnitedStates, Seoul, South Korea, and Singapore, where we are looking to invest in start-ups with the latest technologies or innovative business models. We offer wide-ranging support for business development, marketingand localization for our investee companies when they plan to expand
their business in Japan.

Web Link

KDDI Open Innovation Fund

 DDI ∞ LaboK
In 2011, we launched KDDI∞Labo, a platform that enables start-ups promoting new services to collaborate with partner alliance members thathave a wealth of assets and know-how in various industries with the aimof co-creating new businesses that impact society in the era of 5G. This
program offers total support to selected teams, including business cooperation, creation of testing opportunities, and discussions about businessco-creation with the partner alliance, which comprises over 40 various
major companies that support the mission of KDDI∞Labo. The platform
also offers a variety of other support, including business matching opportunities through pitching events, 5G testing environments, and the provision of KDDI Digital Gate assets.

▪ Change in R&D Expenses
25,000

Promoting Open Innovation

15,381

10,000

5,000

0

2016

50

2017

KDDI Sustainability Report 2020

2018

2019

(Fiscal year)

Web Link

KDDI∞Labo

Activities for Innovation

KDDI Group Activity

Product Innovation
Initiative

Content

Planning anddevelopment ofsmartglasses using
XR technology

In May 2019, KDDI signed a strategic partnership with nreal Ltd. tocreate new forms of communication and to work on Spatial Computing in 5G era, including joint planning and development ofsmartglasses using XR technology and its marketing in Japan. The“nreal light” smartglasses to be used in verification tests are notused alone but connected via USB-Type C cable to either smartphones or nreal Computing Unit, a chipset from Qualcomm in U.S.
These light smartglasses ensure safety, extend operating time, andare compatible with an AR / VR app that enables position tracking.
They have a wide 52° viewing angle but weigh only 88 grams, farlighter than other smartglasses.

Development of
athletes support
system using
athletic behavior
recognition AI

In October 2019, we developed an athlete-supporting system helpful to improve athletes’ techniques. This system uses athletic-behavior-recognition AI to extract 65 skeletal points from photos of an
athlete taken by a smartphone, and recognizes and analyzes theathlete’s form and how each body part is used. In addition, byusing a ball with a built-in sensor and combining the speed, rotation rate, and axis of the ball with the athlete’s movements, theeffect of movements on the ball can be analyzed to find areas ofadvice such as posture, motion, etc.

Process Innovation
Initiative

Content

Providing agile
development
education program

In addition to using agile development methods on our own, in cooperation with Scrum Inc. and Eiwa System Management, Inc., weestablished the joint venture Scrum Inc. Japan in March 2019 tobring about innovation. The company holds agile development
seminars, and is providing wide-ranging support to Scrum teams
from the launch of their agile development teams to the establishment of an agile organization management method. We will continue providing agile development know-hows to support transformation of businesses through digitalization.

Environment Innovation

Web Link

Environmental performance: a low-carbon society

Social Innovation
Initiative

Content

Remotelymonitoring system
in demonstration
test of self-driving
service

In June and July 2019, we participated in the experiment of aself-driving system between roadside rest facilities in a mountainous rural area in Hitachiota City, Ibaraki Prefecture. This test aims
to verify and examine technologies and services necessary to introduce self-driving service as first- and last-mile services in mountainous rural areas. KDDI provided a remote monitoring system forvehicle operation required for the Level 4 driverless self-driving.
Through these initiatives, we will contribute to revitalization of regional industries and prosperous society with convenient transportation.

Started experimentof automatedcapturing using IoT

In September 2019, we started an experiment of a automated capturing system using IoT to reduce serious damage on crops by wildboars. This experiment introduced IoT automated capturing systemwith a function to remotely monitor and operate large-sized traps
laid from mobile devices such as smartphones and tablets, and afunction to detect any animals inside or outside of the trap andautomatically catch them. It is expected to capture wild animals
more efficiently by saving a regular look-around, increasing thenumber of boars captured in a single trap, and reducing the animals that circumvent a trap.

KDDI Sustainability Report 2020

51

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 3

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Fulfilled Life Brought through ICTs
• Contribution to economic growth through robust information communication infrastructure • Improvement of access to education, medicine and other public services through ICTs
• Promotion of employment creation and capacity building • Innovation management

Responsibility for Products and Services

Innovation Management

Protecting Intellectual Property

KDDI

Activity &Results

One of our basic principles specified in the KDDI Code of BusinessConduct defines our commitment to creating, protecting and using intellectual property, which is an important management resource for thecompany’s business expansion, as well as respecting the intellectual
property rights of others and striving not to infringe them.
The Intellectual Property Office promotes internal IP activities related
to putting these basic principles into practice. For example, the office collaborates with IP managers assigned to each department to investigate
the IP of other parties related to new services and to acquire IP rights inJapan and overseas. In addition, we conduct educational activities every
year through group training and e-learning classes to encourage employees to further understand the importance of intellectual property, as wellas the risks of infringement and its prevention. As a result of these efforts,
we hold approx. 4,000 patents in Japan and approx. 600 outside Japanas of March 31, 2020, including pending patents.
Moreover, the office actively supports the KDDI group’s IP activities,
including those of its subsidiaries and the venture companies it has invested in from the perspective of promoting co-creation. In recognition of this
support, we have received the Economy, Trade and Industry Minister’sPrize as an IP usage company (open innovation promotion company) at
the fiscal 2018 Intellectual Property Achievement Awards held by the Ministry of Economy, Trade and Industry and Japan Patent Office.
Since May 2020, KDDI has joined the IP Open Access Declaration
Against COVID-19 and pledged not to exercise any intellectual property
rights owned by it with regard to activities intended to stop the spread of
COVID-19 (https://www.gckyoto.com/covid19). Through this, we will contribute to stopping the spread of COVID-19 early.

Main Innovation Awards Received
Award giving organization: Tsushinbunka Association
Award name: The 64th Maejima Hisoka Award (FY2018)
Awarded research: Contribution to technology for creating software related to encoding,recoding and processing MPEGs
Award recipient (belonging organization at the time of receiving the award):
MP-Factory development team
Date received: April 10, 2019Award giving organization: The ITU Association of Japan
Award name: ITU-AJ Accomplishment Awards
Awarded research: Contribution to international standardization concerning security in
ITU-T SG17
Award recipient (belonging organization at the time of receiving the award):
Yutaka Miyake (KDDI Research Inc.)

Award giving organization: Telecommunication Technology CommitteeAward name: Information and Communication Technology Award, Minister of General
Affairs Awards (FY2019)Awarded research: Contribution to research, development, standardization, andapplication related to encryption and identification technologies
Award recipient (belonging organization at the time of receiving the award):
Toshiaki Tanaka (KDDI Research Inc.)
Date received: June 18, 2019Award giving organization: SCAT
Award name: SCAT president award
Awarded research: Research, development and practical application of ultra high-speed
ciphering technology Kcipher-2
Award recipient (belonging organization at the time of receiving the award):
Shinsaku Kiyomoto, Toshiaki Tanaka, Yuto Nakano (KDDI Research Inc.),
Koichi Sakurai ( Kyushu University)
Date received: January 14, 2020

Others12%

The following websites list awards other than those mentioned above.

After-sales services

Sales

Introduction judgment

Others• Innovative Major Companies Ranking 2019 (sponsored by the Innovation
Leaders Summit Action Committee and the Ministry of the Economy,
Trade and Industry): No. 1 (two years running)KDDI Group

Policy &Activity &Results

Smartphones, mobile phones and the Internet have become irreplaceablein our daily lives.
However, more people, particularly children and older people, get involved in crimes and other troubles.
We promote initiatives to ensure safe use regardless of the users’ levelof ICT literacy. Those include providing products and services that give
advice and instruction on manners to keep in mind and other awarenesscampaigns for safe use.
Cycle Safety Project to Prevent Use of Smartphones While Cycling
In 2017, we launched the Cycle Safety Project. In March, 2019, KDDI and
au Insurance Co., Ltd. launched the third edition of the project, focusing
on high school students*, who are prone to get into a traffic accident
while cycling. To offer an opportunity to simulate the danger from using
smartphones while cycling, which is becoming a social problem, and finda solution to preventing it, we created the VR Class Kit to Prevent Smartphone Use While Cycling. The VR class kit comprises three parts totaling
50 minutes. They are a slideshow that conveys the danger of bicycle accidents and the need to be prepared for expensive compensation; the Stop
Using Smartphones While Cycling VR Experience program, which allows
users to simulate the field of vision and response time to brake when cycling with and without distraction from a smartphone; and a workshop forbrainstorming ways of preventing the use of smartphones while cycling.
Teachers can use this VR class kit as part of their normal lessons, helping
students to think for themselves about the dangers of being distracted bysmartphones through realistic experiences.
Going forward, we will expand the Cycle Safety Project, aiming to realize a society where bicycles can be used safely.
* Reference: National Police Agency, Traffic Bureau, “Child and Student Traffic Accidents” (March
22, 2018)• Quality management• Deal with repair orders

Information Relating to Awards KDDI Research, Inc. Received (2020)• Final verification of safety and performance

Web Link

PolicyInitiatives for Promoting the Safe Useof Products and Services▪ Product Quality Control Process• Verify marks required by applicable regulations• Confirm that no harmful substances are used• Confirm that there are no abnormal heating
events• Verify safety of battery packs, etc.
• Verify software operations• Verify hardware performanceKDDI Sustainability Report 2020

Information Relating to Awards KDDI Research, Inc. Received (2019)KDDI

We implement total quality control from product design to after-sales service to ensure that customers can use our products in a safe and securemanner. With the purpose of realizing the products with safe and secure
quality, in cooperation with outsourcing manufacturers, we at KDDI carefully confirm the safety, durability, and quality of our hardware and software products in each manufacturing process from design to market release based on strict standards.
In case any defects or quality issues arising after products are released, we receive inquiries via our website, phone and au retailers including au Shops to immediately identify the causes and improve both hardware and software.
If any especially serious defects are found, the market response
screening committee chaired by the President is established to confirm
the details and causes, decide countermeasures, and promptly respondto customers.

Quality check52

Web Link

Product Quality Control

Product design

Business modeland application
32%

In our efforts to “add value to the customer experience,” we at KDDI believe it is important to offer products and services so that all customers
can experience the joy of communication.
We offer products and services from a customer perspective, aiming
to create a society in which ICTs is accessible to all, where even more
people the world over — adults, children, older people, people with disabilities and low income earners — have equal access to the benefits of avariety of products and services.
As well as increasing accessibility, we strive to offer services that anyone can use with peace of mind. We are committed to offering products
and services based on the principle of universal design, so that they canbe used with confidence by everyone.

• Verify products based on durability standards• Verify products based on safety standards

Telecommunications
46%

PolicyDate received: May 17, 2019

▪ Breakdown of our patents (As of the end of March 2020)

Speech recognition,
image andaudio processing,security
10%KDDI’s ApproachKDDI Group(Responsibility for Products and Services)

KDDI Sustainability Report 202053

Top Message

Message from Executive Officer of Sustainability

Materiality 3KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Fulfilled Life Brought through ICTs
• Contribution to economic growth through robust information communication infrastructure • Improvement of access to education, medicine and other public services through ICTs
• Promotion of employment creation and capacity building • Innovation management

Initiatives Outside Japan

Responsibility for Products and Services
Initiatives to Promote Safe Use
Targets

Products

Services

A touch-screen mobile phone for kids,
with security alarm, location confirmation feature, etc.
* mamorino5 does not have a voice operation feature

Security Filter
for auYoungpeopleBASIO4Older
PeopleA special price plan for the “mamorino4” and“mamorino5” for children of elementary school
age and under. The plan can be used for abasic fee of 500 yen when subscribing to
2-year contract (Everybody Discount).
Junior Keitai
Plan NA membership-based service with a dedicated team of advisors offering tailoredsupport for customers who have bought amobile phone but are having difficulties
using it or who want to buy one but feelanxious about using it, allowing customers
to use their devices with confidence.

A feature phone focused on ease of use,with a high-quality audio communication
function, simple menu screens, big Blocking spam
letters and larger keys
messages andcalls (forsmartphones)

A service that displays a warning when it
detects probable spam text messages
and phone calls, such as those for fraudulent bills. For incoming texts or calls frompublic utilities, companies, or other sources, the name of the sender or caller willautomatically be displayed using the information from the yellow pages.

Blocking spam
calls(for landlines)

Users with Simple Phone
disabilities KYF36/KYF38

With the customer’s consent, we offer an
Age Confirmation Service that transmits
age information (information that allows
content providers to determine whether thecustomer is over or under the age specified
by the providers) when the customer uses
social media and other services.

A product for first-time smartphoneusers with a large screen that makes it
easy to read texts and see photos. It hasa clear and easy-to-use home screen
au smart
and buttons. In addition, just by pushingsupportthe dedicated button, it is easy to use
auPAY, the smartphone payment service for shopping and payment just byreading a barcode or QR code.

Simple Phone
KYF36/KYF38

Features a text-to-speech function
that, once set up, will read aloudmenu options, e-mails, and other text.
This can be used as an aid not only by
Braille Request
elderly people with diminished eyeService
sight but by other visually impaired
people.

——Initiatives through MVNO

EveryoneA smartphone filtering service to protect
young people from dangerous sites andapps. Filter level can be set according to
the child’s age and what they are using
the smartphone for.
Also provides time limits to prevent overuse, usage inquiries, area search, etc.

* E xit from a 2-year contract or cancellation
mid-contract will incur a contract cancellation fee,etc.

mamorino5

Ageconfirmation
Services

LGBT

Rates

Initiatives to stop smartphone use while walking,cycling, and driving—

Discount service with no fixed fee, for families
using au smartphones or mobile phones.
Domestic SMS messaging (C-mail) and domestic calls among family are free 24 hours a day,based on certain contract conditions. Families
living separately can also apply.
* Can be combined with Smile Heart DiscountBased on the Act on Development of an Environment That Provides Safe
Promote the use
and Secure Internet Use for Young People, as well as implementing filterof filtering services ing for all contracts for minors, we are actively striving to improveuser-friendliness and increase awareness of our filtering services.
We give classes at schools all over Japan, allowing children to learn theskills to safely and properly use smartphones and mobile phones using
their own judgment.
KDDI Smartphone
and Mobile Phone
Safety Classes

Measures againstmoney transfer
fraudsCommunity Involvement & Development / Initiatives

Web Link

Materiality 5:Respect for Human Rights and Fairness in Business

Web Link

KDDI Awareness Raising and Education Initiatives

For Individual subscriptions: Enhancing identity confirmation by restricting thepayment methods for usage fees; preventing mass fraudulent subscriptions
by restricting the number of subscribable lines; enhancing screening via
information sharing among mobile phone and PHS companies about
subscribers of lines whose identities cannot be confirmed; and suspending
the use of land-line telephone numbers that were used for money transfer
frauds or other particular kind of frauds at the request of the National
Police Agency. KDDI employee volunteers conduct awareness raising
activities on Musashikoyama Shopping Street in Tokyo (FY2019: twice)KDDI Group

Policy &Activity

Improvement of Emergency Medical Care in Thailand
In order to cut the death-in-transit rate of Thailand’s ambulance service,
we made research on ICTs emergency medical care and relevant medicalcare in Japan, set up a demonstration system to standardize data format
and operational process used in emergency medical care in Thailand, andconducted a demonstration test in Ubon Ratchathani Province in the eastpart of Thailand. The results will be shared across the country.
E-Learning & Programming Education in Nepal
We have developed an e-learning environment at elementary and juniorhigh schools in Lalitpur, a city adjacent to the country’s capital, Kathmandu, so that students can study subjects, such as arithmetic and science,using e-learning materials. Robot-programming education was also introduced in order to develop logical thinking. The number of schools subject
to this program has gradually increased to ten at present. Each of theschools undertakes their own initiatives, such as open school days attracting local communities.

Supporting “consumer education” run by local authorities, we explain thebasic operation of smartphones and tablets and how to use them safely,
mainly for users aged 70 and under.

KDDI Smartphone
and Mobile Phone
Safety Classes

A service for au Hikari phone option thatblocks incoming spam phone calls, such as
those for scams or solicitations, to a landline
phone. Spam calls from a unknown numbers are automatically blocked without theneed for a special setting.

—

Web Link

An educational website where both parents and children can enjoy learning
Educational
about the important points and rules when using smartphones and mobile
website:phones.
Family Guide to
Smartphones and
Web Link Family Guide to Smartphones and Mobile Phones
Mobile Phones onWEB(Japanese only)

FamilyDiscount

Service for visually impaired users toreceive monthly usage billing informationin braille (including amount charged andbreakdown).

Initiatives of the KDDI Foundation

Measures

Smile-Heart
Discount

Provides discounted rates for persons with disabilities to make au mobile phones easier to use.
As of March 2020, the discounts are available toholders of a physical disability certificate, rehabilitation certificate, certification of psychiatric disorder, medical care certificate for specified
diseases, registration certificate for specified diseases or medical expenses certificate for specified intractable diseases.

Family Discount Eligibility for family-oriented services such as auservice available Family Discount extends to formally certified
to same-sex
same-sex partners
partners

Sign language
support service

Web Link

Community Involvement & Development / Initiatives

Web Link

KDDI Awareness Raising and Education Initiatives

We offer support for contract procedures in sign language at a KDDI
directly managed outlet (au Shinjuku). We also offer remote sign language
support using tablet-based video conferencing functions at several KDDI
directly managed outlets.

——

KDDI Group companies: UQ Communications Inc., UQ Mobile Okinawa Corporation, Jupiter Telecommunications Co., Ltd. and BIGLOBE Inc. offer low-cost communication services to reduce the cost burden for customers. The KDDI
Group offers a variety of services to suit its customers’ needs. KDDI plans to take over the UQ mobile Business of UQ Communications Inc. through a corporate split and offer low priced telecommunications services from October 2020.
Free app to prevent usage while walking. Provide a free app to stop smartphone use while walking and help prevent accidents and injuries and to improve manners.
Cycle Safety Project: A joint initiative by KDDI and au Insurance Co., Ltd. to create a society where bicycles can be used safely. We are raising awareness ofbicycle safety via campaigns using apps and social media, as well as the Stop Using Smartphones While Cycling VR Experience.

Web Link

Cycle Safety Project (Japanese only)• Since “au 5G” service is available now, KDDI offers eight 5G models, from the high specification model with a built-in high resolution camera, such as 8K, to the middle range model with selected functions, so that customers canmake the most of the “UNLIMITED WORLD au 5G.”
Extensive variations of 5G mobile phones• 5G-upgraded models of popular brands among Japanese users, namely ”Xperia 1 II,” “Galaxy S20 5G,” “Galaxy S20+ 5G,” “Galaxy S20 Ultra” and “AQUOS R5G” are available. Popular global brands, OPPO’s 5G flagship(Widest 5G variations from high-end to low-cost models)
smartphone model “OPPO Find X2 Pro” and ZTE smartphone “ZTE a1,” are also available only to au users (as of June 2020). In addition, KDDI, for the first time as a Japanese telecommunications operator, has released Xiaomi
smartphone “Mi 10 Lite 5G.”

54

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

55

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 4

Materiality 3

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Recruiting and Developing Human Resources
KDDI’s ApproachKDDI Group

Social Issue
Improving productivity is an urgent issue to Japan suffering the shrinking population. The Japanese government has launched a plan to “realize the dynamic engagement of all citizens” and embarked on a Work
Style Reform, which seeks to allow more diverse working styles, increase middle earners, counter the entrenchment of inequality andcreate a virtuous circle of growth and distribution. However, Japan has
the worst labor productivity in the G7 countries, which needs to improve. Furthermore, in the fight against the global outbreak of
COVID-19, we face a challenge to adopt the “new normal” that would
significantly change our ways of living and working.

Management FrameworkIn the Medium-Term Management Plan (FY2019–FY2021) we established KDDI’s Target SDGs and decided to focus on human resource development; support for women’s advancement; respectfor human rights, diversity & inclusion; and environmental conservation as social issues to be solved through corporate activities. In addition, regarding support for women’s advancement, we have been
setting medium-term quantitative goals since 2016 and working toward their achievement.

PolicyOur Risks and Opportunities
The decline in the productive population due to low birth rate and aging society is causing difficulties in recruiting high quality human resources. In addition, we need to provide an attractive work environment that offers diverse work styles to suit a diverse workforce.
In June 2020 we introduced a new personal development program
showing an example of new work style in light of the “new normal” tohelp each and every employee to design their work style according totheir current life stage and their values, so that they can achieve personal and organizational goals while pursuing their career. Through improvement in both tangible and intangible elements of work environment, we expect to recruit more diverse workforce in the future.

In April 2018, we announced the KDDI Group Declaration of
Health-Focused Management and began promoting health-focusedmanagement that supports each employee’s health. We also established the Work Style Reform and Health-Focused Management
Promotion Office in January 2019, and are working to develop asound work environment as a foundation for sustainable growththrough the activities of the Work Style Reform Promotion Committee and all employees interview by internal counselors.

 o maximize the value of human resources and ensure the appropriT
ate placement of human resources, we built a system to standardize
hiring, placement, education, and training. In this way, we havemaximized organizational performance and the growth of each employee. Furthermore, in fiscal 2020 each organization started working on SDGs as part of its organizational goals to encourage its
members to understand SDGs and take actions for them.

FY2020 Material KPIs

Web Link

56

KDDI Sustainability Report 2020

Human Resources System

KDDI

SystemTo maximize the value created by human resources and ensure that theright people are placed in the right roles, we have established an organizational structure that manages the recruitment, development, utilizationand career progression of human resources as a vertically integrated process, effective from fiscal 2017. In this way, we have maximized organizational performance and the growth of each employee.

based on abilities
andcharacteristics

Human Resource Cultivation
Management

KDDI

Activity &Results

In the recruitment stage, we have removed the gender query from theapplication sheet to ensure we hire diverse talents.
We also have a variety of training and qualification schemes that givecontract employees, such as mass-retail sales advisors, talent development
opportunities. Those who wish can apply for a permanent contract, and27 contract employees became regular employees through this scheme infiscal 2019.
We execute various measures for effective employee growth, including on-the job training (OJT) and off-the-job training (OFF-JT). Additionally,
we create a drive to grow in employees by providing each with proper
evaluations and feedback. We have also prepared various programs for
those employees passionate about growing themselves and leadingchanges that encourage them to work on actively cultivating their potential
instead of staying passive.
Also, we support the acquisition of company-designated qualifications
by paying examination fees and other related expenses.
•F Y2019 number of newly hired graduates of nationality other thanJapanese: 4• FY2019 Percentage of newly hired female graduates: 32.3 %▪ Retention of Newly Hired Graduates (KDDI) 

Unit: person

Male

FemaleGraduates hired in April 2017

211

96

Currently employed in April 2020

204

89

▪ FY2019 Employee Training Results (KDDI)
Results

PolicyKDDI Group

Experience
EducationandTraining

Evaluation(Performance)

Training expenses per employee

Unit: yen / person

Training time per employee

Unit: hour / person

Total training time

Unit: hour

80,0005.0
95,125

PolicyPromotion of diversity and inclusion
Human resource development and career development
Improve employees’ healthKDDI Sustainable Action P.12 - 29
Recruiting and Developing Human Resources
Labor Practices P.62 - 71

PolicyAs the working-age population continues to decrease due to the declining
birthrate and aging population in Japan, it is said that the country’s economic growth will slow down. The market environment of the information
communication sector has been changing rapidly and drastically in recent
years as we have been experiencing technological innovation, intensifiedcompetition on a global scale and the participation of a variety of carriers.
To respond to these changes and continue growing in a timely manner,
we need to recruit diverse talents regardless of nationality, gender, age or(dis)ability and promote their advancement.
We regard the recruitment and development of human resources thatcan lead the new business area of integrating telecommunications and life
design and the raising of the potential of the company’s workforce as thehighest priority.

Recruiting

FY2020 Material KPIs

Initiatives

KDDI

Positioning

KDDI GroupMoving Forward

KDDI’s Approach(Recruiting and Developing Human Resources)

Employee growth and optimization of organizational performanceKDDI Group

PolicyP.57 - 61

KDDI Sustainability Report 202057

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 4

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 4

Materiality 3

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Recruiting and Developing Human Resources

KDDI Human Resource Cultivation Measures

KDDI

SystemKDDI Human Resource Cultivation Measures
ProgramContentKDDI’s Approach(Professional Advancement of Women)

Executive assistant
Job rotation system

Eligible employees during a career selection period work out their own career plan and make a choice for their career in the futurewith autonomy and responsibility, to grow themselves.

Self-career produce system (SCAP)

Employees can transfer to the departments of their choice after accumulating a certain amount of experience in their current
positions and earning positive evaluations.

Open recruitment system

Employees who are enthusiastic about starting up new business or expanding growing departments can apply under the open
recruitment system to be transferred (includes promoting involvement among elder staff).

Career plan reporting system

Employees can consult with their respective department’s general manager on their future career plans based on the reports about
their career history and current situation.

Stratified training

Employees acquire the knowledge and skills needed for carrying out their work depending on the position or qualifications they have.

Common skills training

Employees acquire the various business skills commonly needed by everyone in the company.

Support for acquisition of qualifications

We pay examination fees and other related expenses for employees who are acquiring company-designated qualifications.

Lifelong learning sabbatical program

Employees wishing to study toward a qualification or acquire new skills on a voluntary basis can take a career break of up to three
years.

Business study abroad

Participants learn global standards for business at an overseas university or through communication with business persons at NPOs
or internship.

Specialized study abroad

Participants study at an overseas university or specialized institution to acquire advanced specialized knowledge and build human
networks with relevant persons.

Overseas trainee system

Employees wishing to join the program are sent to an overseas base for a certain period of time and, by conducting business, theylearn how to carry out their work in a professional manner no matter the values and business customs of those who surround them.

1 Number of female line managers: 200
2 Usage rate of annual paid leave: 70%
3 Percentage of newly hired female graduates: 30%

Global employee exchange program

In this program, employees hired overseas are invited to our headquarters in Japan to learn about the business customs, operations
and philosophy of the KDDI Group and strengthen their partnerships with foreign customers who have offices in Japan.

Actions

English circle support

We support English self-study circles in each workplace by providing instructors and contributing funds.

Position

The KDDI Group Philosophy

Executive / Director

Divisional general manager
study session

Departmental
General Manager

Departmental generalmanager training

Newly-appointed departmental
general manager training

GL (Group leader)

GL Study Session

Newly Appointed GL Training
Training by Division

KDDI Sustainability Report 2020

Division-specifictraining
Operation-specificskillsAction Plan Based on Japan’s Women’s
Advancement Act

KDDI

PolicyWith the enactment of the Act to Advance Women’s Success in Their
Working Life on April 1, 2016, we at KDDI have set the following targets inrelation to actions to be implemented over a five-year period from April 1,2016 to March 31, 2021.
Targets• Cultivate leaders consistently through the Female Line Manager Program• Promote measures to encourage employees to take paid annual leaveby creating plans for taking leave and setting recommended dates fortaking leave in each department

Cultivating Women (inside the company):
Female Line Manager Program

KDDI

System &Activity

In fiscal 2016, we started the Female Line Manager Program (JLP), whichaims to establish a career path leading to officers and line managers,
targeting female employees from those just below a section manager
position to candidates for a general manager position. Selected managerial
candidates have opportunity to participate in Mind Up Seminars, where
they can learn the skills necessary for leadership and adjust their mindsets.
In addition, we help them develop leadership and further grow as a leader
by promoting dialogues with female executive role models within thecompany. We are continuously providing e-learning to promote understandingof the necessity and method for cultivating female managers for all line
managers, including male managers, as we work to reform mindsets within
the company.

Cultivating Women (outside the company):
Cross-Industry Forums

KDDI

Activity &Results

In addition to internally training personnel, KDDI has proactively participated in cross-industry forums, with a focus on initiatives to raise female employees’ viewpoints. Through participation in various opportunities for personal exchange, including the Eijo College that aims to create amanagement model for female sales representatives, J-Win for development of female leaders, the International Conference for Women in Business where approximately 800 women gather from Japan and abroad toachieve self-growth, and the Lead the Jibun Camp designed for a person
to lay the foundation as an innovative leader, we encourage female employees to get motivated and raise their self-awareness and viewpoints as
a leader.

Activity &Results

Cultivating and Promoting Female Leaders KDDI

We believe that the participation of women in company decision-making
will contribute to enhancing our corporate strength and are focusing on afemale leaders training program. Our specific goal is to appoint 200 femaleline managers, who are authorized to conduct personnel evaluations byfiscal 2020. Progress on this front is reported every six months to a meeting attended by managers.We are also striving to expand our female managers training program, which will lead to more female leaders.

Overseas
Study

Employee

Training 3 years after employment

Global humanresources

Overseas
Trainees

Chief

Newly Appointed Manager
Training

Common skills
training

Common skills training

Assistant Manager

Philosophy Study Session by layer /Study Session by Department

Manager (Non-line)

58

Stratified training

PolicyPromoting gender equality and female empowerment not only deepens
our understanding of their human rights but leads to solutions to issues ininternational society and corporate sustainable development.
This is reflected in the medium-term management plan, and we arepromoting the advancement of women as a business strategy.
We at KDDI strive to establish an environment and create a climate
where diverse human resources can use their individual strengths toperform to the best of their abilities. We are focusing on cultivating female
leaders, raising awareness while changing the behavior of management
and improving the working environment, so that women can become
ambitious to build their own career and continue to work even while going
through major life events, like giving birth and raising children.

Employees work as directors’ assistants, learning directly the management mindset. (Every year, one man and one woman are
assigned.)

Training System by Position

KDDI

Unit: person

Executive / Director
Managers

Executive Officers
Outside directors

2
1
341

Line managers

156(as of April 1, 2020)

Training 2 years after employment
New Employee
Employee Training
Training
New

KDDI Sustainability Report 202059

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality

Materiality 4

Materiality 3

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Recruiting and Developing Human Resources

Evaluation and Remuneration Systems

KDDI

PolicyTo achieve fair and transparent personnel evaluation and remuneration,
we have established common standards and grades for the performanceand requirements demanded by the company.
For managers, we adopted a mission grade system that categorizes
the grade of a manager by the size of their role, including the scope of
their current work responsibilities, authority and achievements. For
non-managers, we adopted an aptitude grade system based on their ability to execute their duties.
In addition, based on discussions with their supervisors, employees
set individual goals that take into account personal growth and theachievement of corporate and organizational goals. Personnel evaluations
are conducted through face-to-face interviews with supervisors regarding
the level of achievement of these individual goals. A final determination ismade based on evaluations by multiple people. These evaluations are
conducted twice a year for all employees. Any employee who is not satisfied with their evaluation can file a complaint with the Human Resources
Department, submitting an application sheet.
As for bonuses, there are two types: corporate performance bonuses
that reflect the company’s performance and individual performance bonuses that reflect the personal business performance of each employee.

Award Program for Employees

KDDI

Activity &Results

Results▪ Employment Status

We have implemented award programs for employees to increase
motivation and a sense of solidarity.
▪ President’s Award Results
Award name

Unit: caseNumber of awarded cases

President’s Award

3

Contribution Award

1

Nice Try Award

1

Best Sales Award

3

Individual MVP Award

2(Evaluation period: April 1, 2019-March 31, 2020)▪ Foreign Employee

KDDI

Providing Long-term Incentives for(Managerial) Employees

KDDI

System

We have introduced a performance-linked stock compensation system as anincentive plan for managerial employees. This system is designed to provide
the company’s share to KDDI managers when specific requirements are met
in accordance with stock grant regulations set by the company in advance.
By providing incentives, the system aims to improve the awareness ofmanagers regarding the company’s performance and stock price, as well as tofurther encourage the execution of operations aimed at improving performance
while contributing to corporate value over the medium-to-long term.
60

KDDI Sustainability Report 2020

FY2017FY2018FY2019FY2016FY2017FY2018FY2019Male (KDDI)
Female (KDDI)
Number of
Unit: Total (Male and1*
employees person Female)
Consolidated number of employees
Male
Average
Unit: Femaleage (KDDI)age Total(Male and Female)
Male
Averageworking
Unit: Female
years
year Total(KDDI)(Male and Female)

8,649
2,126

8,718
2,198

8,723
2,314

8,574
2,394

8,465
2,427

10,775

10,916

11,037

10,968

10,892

31,83435,03238,82641,99644,952

42.7
39.2

42.9
39.3

43.2
39.4

43.4
39.4

43.6
39.7

42.0

42.2

42.4

42.5

42.8

Male

8

17.6
16.0

17.7
16.0

18.1
15.9

18.2
15.7

18.4
15.9

Female

1

17.3

17.4

17.6

17.7

17.8

Total
(Male +
Female)9

Employment
turnover (KDDI)*2(Total)0.92 (Total)1.11(Total)1.08(Total)1.43(Total)1.45(Male)0.68 (Male)0.95 (Male)1.01(Male)1.30(Male)1.30(Female)1.99 (Female)1.79 (Female)1.39 (Female)1.96 (Female)2.03

Unit: %

*1 “Number of employees” is the number of regular KDDI employees, including employees temporarilytransferred to KDDI. The number does not include employees who are transferred to other companies*2 “Employment turnover” is the calculated percentage of resignations during the relevant term (employees
who resigned at their request, excluding employees who retired at retirement age) in the total number ofregular employees in the first month of the relevant term

Unit: person

Activity &Results

Since fiscal 2019, KDDI has conducted the Employee Engagement Survey,
because we consider that if each and every employee can work feelingmotivated and fulfilled, it will contribute to sustainable growth of the company.
This survey measures, based on indicators, the level of “voluntary
contribution and motivation toward the company and their work,” theemployee engagement defined by KDDI.
The results of the survey are shared real-time with leaders of eachorganization.
Human Resources Department does not analyze the results of the
Employee Engagement Survey or formulate measures using the results.
The leader of each organization will share the results with their respective
members and discuss what actions to take for them to work feelingmotivated and fulfilled. We believe that this process itself will improve thelevel of the employee engagement.
We are committed to improving the employee engagement by working
on this activity company-wide.

FY2016FY2015FY2019Departing
Employees

Total
Retirement *Excludes employees who
age
retired at retirement age

Number of foreign
employees (KDDI)105

Proportion of foreigners in new
employees (KDDI)

101

5.2%

Number of foreigners at the
management level (KDDI)

2.0%

7

Consolidated number offoreign employees

114

3.6%

10

4,380

114

56

Female53

Total(Male +
Female)

109

2.1%

11

4,423

Male

2.05%

10

4,308

4,208

4,393

▪ Non-Regular Employees (KDDI) (Number of workers temporarily employed)  Unit: person
FY2015FY2016FY2017FY2018FY2019Temporary staff (KDDI)

3,512

3,940

4,531

4,196

4,604

Contract employees (KDDI)

3,317

3,101

2,637

2,216

1,964

6,829

7,041

7,168

6,412

6,568

Early

Self

Under 30

0

24

1

0

0

0

25

Total

30–39

0

61

0

0

0

0

61

40–49
50–60
61 or over
Total
Under 30
30–39
40–49
Female50–60
61 or over
Total
Under 30
30–39
40–49
Total
50–60
61 or over
Grand total

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

24
32
0
141
15
22
16
3
0
56
39
83
40
35
0
197

4
3
0
8
0
1
1
0
0
2
1
1
5
3
0
10

0
0
6
6
0
0
0
0
0
0
0
0
0
0
6
6

3
7
0
10
0
0
1
0
0
1
0
0
4
7
0
11

0
0
39
39
0
0
0
0
1
1
0
0
0
0
40
40

31
42
6
165
15
23
18
3
0
59
40
84
49
45
6
224

Note: The numbers of non-regular employees for FY2017 and FY2018 are the same as those on Securities
Report.

Male

Employee Engagement Survey

Unit: person
FY2015

Male / Female

Company Transfer

Other

June 2016 June 2017 June 2018 June 2019 June 2020
Number of employeeswith disabilities
Employment rate ofpersons with disabilities

Unit: person

372

403

417

417

▪ Employees by Age (KDDI)

2.19

2.38

2.53

2.53

Notes 1: The number includes persons with disabilities who are employed at KDDI, as well as at KDDI
Challenged and KDDI Engineering
Notes 2: The number is calculated by counting persons with severe disabilities as two people▪ Status of Hiring(KDDI)
Male / Female
FY2015
Male
203
University graduate
203
Female83
Recent
University graduate
83
university
graduates
Junior / technical college graduate
0High school graduate, etc.
0
Total
286
Male
46
University graduate
45
Other
1
4
Mid-career hires Female
University graduate
4
Other
0
Total
50
Male
126
Reemployment
Female13
after retirement
Total
139
Non-regular employees who became regular employees
82

Unit: person
FY2016
217
217
85
85
0
0
302
46
45
1
9
9
0
55
143
17
160
122

FY2017
211
211
96
96
0
0
307
76
74
2
7
7
0
83
112
13
125
118

FY2018
181
181
106
106
0
0
287
102
95
7
9
9
0
111
121
19
140
66

FY2019
202
202
91
91
0
0
293
120
76
44
15
12
3
135
130
10
140
27

Female

1,436

963

473

30–39

2,323

1,744

579

40–49

4,000

3,015

985

50–60

3,130

2,740

390

3

3

0

10,892

8,465

2,427

61 or over
Total

(As of March 31, 2020)▪ Managers(KDDI)

410

2.54

Male

Under 30

Male Managers
Unit: %

Unit: person

Total

Department Managers or higher
Section Managers
Female Managers

Unit: person
FY2015FY2016FY2017FY2018FY2019

4,115

4,155

4,195

4,184

4,202

411

465

481

472

513

3,674

3,690

3,714

3,712

3,689
342

251

270

302

321

Department Managers or higher

11

12

17

23

23

Section Managers

240

258

285

298

319

Proportion of Female Department
Managers or higher

2.4%

2.5%

3.4%

4.6%

4.3%

Proportion of Female Section
Managers

6.1%

6.5%

7.1%

7.4%

8.0%

Newly Appointed Managers

390

195

209

192

191

Male

309

169

173

163

165

Female

81

26

36

29

26

Note: The number of managerial personnel includes KDDI managerial personnel as well as those temporarilytransferred to other companies▪ Retention of Newly Hired Graduates (KDDI)

Unit: person
Male

FemaleGraduates hired in April 2017

211

96

Currently employed in April 2020

204

89

KDDI Sustainability Report 2020

61

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 4

Materiality 3

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Labor Practices
KDDI’s Approach (Labor Practices)

KDDI Group

PolicyWe at KDDI regard the health of our employees as a key management issue as stated in the KDDI Group Declaration of Health-Focused Management. We support their health at the organizational level to foster an environment and culture where everyone can work healthfully and earnestly,
maximize individual and organizational performance and ensure sustainable growth as a company. We also comply with laws relating to the prohibition of child labor and forced labor and the payment of minimum wage.
Starting Salary for University Graduates Compared to Minimum Wage 139%** Calculated based on the minimum wage in Tokyo (1,013 yen / hour). Specifically, the formula is
21 days × 1,013 yen × 7.5 hours (as of April 2020)

Declaration of Health-Focused
Management

KDDI Group

PolicyThe KDDI Group has released the Declaration of Health-Focused
Management as part of its commitment to support every employee’s
health at the organizational level and bring about a prosperous future.
Building on this declaration, we are working on a range of initiatives todrive work style reform, promote mental health care, improve employee
health management and look after the health and safety of employees andtheir families posted abroad, aiming for embedding a “health first” culture.

Work Style Reform
In January 2017, we launched full-scale initiatives for work style reform topromote fundamental changes in perspectives and behaviors toward awork style that is more productive. We also established the Work Style
Reform Promotion Committee as part of the initiatives. The committee
members consist of General Managers representing Divisions and theGeneral Manager, Human Resources Division is the chair. Since April
2018, the heads of strategic subsidiaries have also been participants.
From fiscal 2019, we launched a work style reform project team with a
primary mission of accelerating the adoption of diverse work styles andimplemented work style reforms, such as developing a better work environment and the vision on new work style.
▪ Operational Framework of the Work Style Reform Promotion Committee
Management Level
Instruct
response

In our mission statement we declare: “The KDDI Group values andcares about the material and emotional well-being of all its employees
and delivers a thrilling customer experience by always going further
than expected with the ultimate goal of achieving a truly connectedsociety.” As the success of the company depends on a happy andenergized workforce, we see the health of our employees as a key
agenda for the management of the KDDI Group. We hereby declare
our commitment to health-focused management, through which wewill support the health of our employees at the organizational level as
we strive for a prosperous future.
The KDDI Group will:
1.	Encourage and help our employees to take proactive steps toimprove and maintain their health.
2.	Work closely with the KDDI Health Insurance Union and theKDDI Workers Union to improve the physical and mental healthof our employees and their families.
3.	Embed a "health first" culture within the group, where the pursuitof physical and mental health creates an energized and productive
workforce.

Web Link

Declaration of Health-Focused Management

ReportWork Style Reform Promotion Committee
Chair: General Manager, Human Resources Division
Committee members: All Division’s General Managers /Presidents of strategic subsidiaries
Instruct
response

Declaration of Health-Focused Management (April 2018)KDDI GroupMake
improvements

ReportDeliberateissuesCompliance

Secretariat(Work Style Reform &Health Management
Department)

Make
requests

Environment Creation

Work Style Reform
Project Team

Departments＋
Strategic Subsidiaries
KDDI Evolva, Inc., KDDI Engineering Corporation , KDDI MATOMETE OFFICE CORPORATION,
Chubu Telecommunications Co., Inc., BIGLOBE Inc., UQ Communications Inc., OKINAWA
CELLULAR TELEPHONE COMPANY, au Financial Holdings Corporation, AEON Holdings
Corporation of Japan, ENERES Co., Ltd.

System &Activity &Results

Initiatives and Results of Work Style Reform in Fiscal 2019• H eld monthly Work Style Reform Promotion Committee meetings(topics: eliminating long working hours, increasing productivity, etc.)• For purposes of appropriate work schedule management and earlysupport for an employee likely to feel mentally sick, conducted an interview
to all 12,000 employees working at workplaces in Japan twice a year
• A s part of promoting “Autonomous Work Style,” abolished thecompany-wide standard on work clothes and made each division set
its own standard• Ensured all employees leave work within 30 minutes after the end of
business• Promoting the rule about leaving work by 20:00• Enforcing No Overtime Days and ensuring permission is granted inadvance to work overtime• Extended the interval between shifts from 8 to 9 hours• Created a system to record and manage employees’ building entry andexit times as well as work computer log off times; Discrepancies
between system logs and applications trigger alerts• Promoted planned usage of annual paid leave• Introduced robotic process automation (RPA)• Made internal systems accessible to mobile devices• Began allowing tethering for work smartphones• To operate good quality meetings, made each division develop its actionplans for meeting reform• Promoted use of shared offices• Participated in Telework Days as a special sponsor• Held rehearsals in anticipation of the period of the Olympic Paralympic
Games• Revised the Teleworking Work Rule in order to expand opportunities forteleworking and ensure appropriate application.
▪ Organization of the Work Style Reform & Health Management Department(as of April 2020)

Human
Resources
Division

Work Style Reform &Health Management Department
Work Style Reform GroupCounseling 1 GroupCounseling 2 Group

Almost all members arecounsellors assigned toeach workplace

Counseling 3 Group
Health-Focused
Management Group

Safety and Health Management System

KDDI

SystemIn accordance with the Labor Standards Law and the Industrial Safety and
Health Act, we are engaged in a group-wide health and safety drive to secure the safety and health of workers in workplaces and facilitate the establishment of a comfortable working environment. We have established asafety and health management system, which includes general safety andhealth managers, safety officers, health officers, safety and health promoters, health promoters, industrial physicians, and employees in charge ofmental health promotion in each workplace. We have also established
Health and Safety Committees that plan and conduct activities as joint labor-management efforts.
Health and Safety Committees• Established at workplaces with 50 or more workers• Held once a month• Topics: health-focused management, health management,
mental health, work style reform, overtime work and long working hours, fire prevention and disaster preparedness, traffic safety• Important matters on safety and health are reported to the Executive
Director of the Corporate Sector
To create a comfortable working environment, we conduct the statutory
atmospheric environment measurement every two months for temperature, humidity, air current, carbon dioxide, carbon monoxide, and floating
dust, and if any deviation is detected, work with a respective facility management company to take appropriate countermeasures, such as ventilation and cleaning. In addition, in FY2020, we removed all smoking rooms
from offices to reduce passive smoking risk.
Departments handling constriction as a contractor provide internal
chief engineers and managing engineers with regular safety trainings toprevent accidents such as electric shock. These trainings include Safety
Training for Dangerous Operations, Tool Training, Health and Safety Education for Foremen, Chief Engineer Training, and thus strive to ensure
thorough safety control.
In a twice-yearly safety convention for contractors in charge of basestation and network facility construction projects involving dangerous operations, such as working in high places, as well as a Group Safety Convention for group companies, we have shared safety-related examples
and provided information on how to improve safety-related skills. In addition, in 2019 we provided trainees from MPT, a telecommunication company in Myanmar, with safety training using a KDDI-produced safety
awareness raising comic titled “Pronogenba (worksites of professionals).”

Around half are public healthnurses.
Employee consultation
managers are also stationed.

Human Resources Development
Department
Human Resources Planning
Department

62

KDDI Sustainability Report 2020

KDDI Sustainability Report 202063

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 4

Materiality 3

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Labor Practices

Priority Measures Relating to
Occupational Health and Safety

KDDI

ActivityKDDI is running a number of initiatives to drive health-focused management based on the basic principles of respect for human life, ensuring thesafety and mental and physical health of employees in workplaces at all
times, and maintaining a comfortable working environment.
Health-Focused Management Actions
As part of the drive to promote health-focused management in fiscal
2019, we conducted a health awareness survey of all employees and implemented measures based on the survey results. As part of the measures, in fiscal 2019 we introduced KDDI Wakuwaku Points, which is ahealth point program that provides employees with a mobile app withfunctions designed to improve health literacy, such as access to health-related information focusing on diet, exercise, sleep and smoking, a challenge program to change lifestyle habits, and a walking event .
A set of health KPIs have been defined as targets to be achieved byfiscal 2020 to improve the health of employees.
Initiative• Encouraged walking• Held seminars on sleep:“Seminar on sleep”
“Secrets behind hormone a working woman
needs to know to stay attractive”
“Seminar on good physical balance”
“Seminar on preventative measures against aheat stroke”
“Seminar on countermeasures for lifestyle-relateddiseases”• Held hearings for smokers regarding bans on smoking

Promotion of Mental Healthcare

KDDI

Activity &Results

KDDI formulated the Mental Health Promotion Plan and is carrying it out
while implementing PDCA cycles for mental health initiatives. In addition,from fiscal 2019, we stationed 36 new internal counselors across thecompany and began interviewing all employees. The interviews enable us
to hear directly from employees and assess working conditions from perspectives that differ from those of their superiors. They also help us quickly identify employees who are showing signs of difficulty even in the absence of reports from said employees, enabling us to act promptly incooperation with medical professionals and managers as necessary. In
this way, we are creating a healthful work environment.
Initiative• Offering level-specific e-learning courses related to mental health• Offering harassment prevention seminars for managers• All regular and contract employees complete a stress check once a year
(Employees surveyed in FY2019: 88.9%)• Based on the results, employees can consult with an industrial doctor ifthey request.
• The overall results are analyzed and sent to each work place to share theissues revealed, and workplaces with high stress levels are instructed todevise measures for improvement.
• Obligatory submission of medical history forms, interviews with industrial
doctors and individual follow-ups by industrial health staff for employees
who worked more than the prescribed number of hours of overtime• Established the Employee Counseling Center and an external counselingoffice, which are staffed by industrial counselors• We offer total support for employees when they return to work after
absence due to mental health issues• Industrial doctors interview returnees as well as the returnee’s
supervisors•T raining before returning (return-to-work program, etc.)•R educed work hours after returning•C olleagues, industrial doctors and health staff collaborate tofacilitate the returnee’s smooth return to work in addition to
the support provided by their supervisors

Enhancing Employees Health64

KDDI Sustainability Report 2020

FY2016FY2017FY2018FY2019

87

100

99

112

101

Activity

Providing Health Exams That Exceed Legal Requirements
We conduct regular health exams that are more detailed than required bylaw, with an examination rate of 98.3%. Following those exams, we informall those diagnosed with observation by email. As for those who are diagnosed with severe health problems, we urge them to have an emergent
consultation at a medical institution as soon as possible, and in fiscal
2019, 98.3% of employees followed the advice. For employees with conditions that do not appear to improve over time, we provide counselingwith their supervisors and industrial doctors as well as health guidance
until their conditions improve. In addition to the company program to assist with complete medical checkups, in since FY2018, we have had aprogram in place to provide full reimbursement for breast cancer screening for female employees 35 years old or more.
Furthermore, in partnership with the KDDI Health Insurance Union, we
actively promote measures to prevent diseases from becoming severe(data health planning). The health guidance given by the union to prevent
lifestyle-related diseases achieved a complete rate of 23.4% for active
support and 27.5% for motivation support, and we continue our efforts toincrease these rates, including continuous support on an e-mail basis. To
promote better health, the union also dispatches lecturers to provide
health seminars at workplaces and, in fiscal 2018, introduced a healthbusiness that provides free dental checkups.
In addition to measures taken to date, in fiscal 2019, we introduced
KDDI Wakuwaku Points, which is a health point program for all employeeswith the goal of encouraging improvements in behavior by, for example,
promoting fun exercise (walking) and changes in lifestyle habits.

Safety and Health Management for Employees
and Their Families Transferring Overseas

KDDI

SystemWe conduct various activities aimed at ensuring the health and safety of
employees working outside Japan. We provide consultations with industrial doctors to employees before they transfer overseas, interviews withmedical staff to all employees returning to Japan and follow-up care after
the regular health exams to employees working overseas. We also began
conducting stress check for employees working overseas and providing
follow-ups, including health checks as required. Furthermore, we have established and implemented the Vaccination and Health Report Guidelines
for International Transferees and Business Travelers from the perspectiveof health management and employee safety for those transferring or traveling outside Japan.
We introduced a medical return program that covers the expenses of
employees or accompanying family members returning sick or injured toJapan, if an industrial doctor judges that they should receive treatment inJapan. In preparation for emergent situations, we have set up emergency
evacuation services for all employees stationed or on a business trip overseas for evacuating in the event of terrorism or political instability. We alsooffer emergency medical transport services for the transport of severely ill
or injured persons to a different country for medical treatment if necessary.

▪ Other Health Management Measures
Measures

TargetContent

Healthcare
room

Regular andcontract employees,
temporary staff

When they feel sick, they can take a short
rest in this room and receive first-aid careand health counseling

Refreshroom

Regular and contract Services such as massage and acupuncture
employees,
and moxibustion are offered by nationally
temporary staff
qualified practitioners

Wellnessbenefits• KDDI Group Welfare Association provides
subsidies related to such issues as childbirth / childcare, family care, health maintenance, personal development and emRegular and contract
ploying a housework helper (Employees
employees
are free to choose the services they need)• K DDI Health Insurance Union provides
special benefits in the form of sports clubaccess▪ Changes in Number of Employees Absent Due to Mental Health Problems(KDDI) (at the fiscal year end)
FY2015KDDI

KDDI Sustainability Report 2020

65

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality

Materiality 4

Materiality 3

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Labor Practices

Diverse Work Styles

KDDI

System▪ Programs That Support Diverse Work Styles
ProgramIntroduced to encourage a work style where the emphasis isplaced on high performance achieved in a shorter time. At
the end of March 2020, 17% of the eligible employees use
this system.

Work shift interval
rule Program

Introduced to raise awareness of a more health-focusedwork style. The rule stipulates that employees should rest fora minimum of nine hours between the end of a shift and thestart of the next day’s shift with overtime work in consideration. Additionally, health management is conducted in casethey exceed a certain number of days when they cannot take11 hours of rest.

Flexible working
hours system

Introduced to encourage employees to work flexibly and autonomously. In April 2020, this rule was expanded and has
been applied across the board.

Shorter working
hours system forparents

Introduced to support a good work and childcare balance.
Employees can decide their working hours per day between
5 to 7 hours according to their family care responsibilities.
This system is also available on a monthly basis to employees using the variable working hours system.

Shorter working
hours system for
caregivers

Introduced to support a good work and family care balance.
Employees can decide their working hours per day between
5 to 7 hours according to their family care responsibilities.
This system is also available on a monthly basis to employees using the variable working hours system. They can use
this system as long as care is necessary.

Spouseaccompanimentleave program

Established in April 2017 to support the work-life balancewith a long-term perspective. The system allows a maximum
three-year leave of absence to employees who accompany a
spouse who has been assigned overseas so that they may
live together. The program also applies to employees whose
spouses are not KDDI employees.

Career-track
employment withrestricted work area
(L course)

Established in 2016. L-course employees are not transferredoutside the specified work area without their consent. The
system enables the company to retain career-track workers
who have difficulty relocating due to such factors as achanging home environment.

Initiative

Less commuting to work
Time for antenatal hospital checkups

Time for antenatal hospital checkups(only if so directed by doctor)

Support before andafter birth
Support during leave ofabsence

Maternity leave
Paternity leave (for men only)
Parental leave of absence“wiwiw” support services for return to work after parental leave of absenceChildcare time
Shortened working hours for childcare
Flextime

Support forwork-childcare balance

Sick / injured childcare leave
Exemption from overtime work

Improve employment environment to support the work-life balance of
employees who are engaged in childcare and / or family care
• Flexible working with options to suit home and work circumstances• Seminars for employees on maternity or parental leave and for employees caring for a family member while working
Our work regulations prohibit harassment, and we have set up a counseling office and provide training to spread such awareness in the company. From fiscal 2016, the scope has been expanded to include pregnancy harassment, and more robust action is taken.

For men and women

The end of
fiscal year inwhich childturns nine

Discretionary work
system

Support during
pregnancy

For men only

Age two

Variable working
hours system

Introduced so that employees can change their prescribedworking hours every month or every three months according
to their volume of work. This system is also available on amonthly basis to employees requiring shortened working
hours due to childcare and / or family care responsibilities.

For women only

Age one* We were selected as a Telework Pioneer 100 certified by Japan’s
Ministry of Internal Affairs and Communications in April 2016

System▪ Program for Work-Childcare Balance

BirthIntroduced for all employees to enable flexible work hours
and to boost work efficiency. A support program was alsoestablished for employees who need to do constant childcare and / or family care, which only requires them to comeinto the office as little as once a month. We also recommend
working at a satellite office and mobile working.

To help employees balance work with other responsibilities, such as childbirth, childcare, and family care, we have established a support systemthat exceeds legal standards.
In fiscal 2019, we held a seminar on searching for nursery schools byoutside experts to provide recent trend and know-how. The seminar wasattended by many employees: not only employees taking or planning totake parental leave of absence, but also those with no immediate plan but
with interest or for the purpose of sharing the information with their subordinates or colleagues. (Approximately 40 % of 108 participants were male
employees.) After returning to work, the flexible working environment
allows the returnees to choose from different work style options to suit
their preference and their particular work situation, including shortened
regular working hours (5-7 hours / day), variable working hours, and telework. While making use of shortened working hours for childcare or while
overtime work is exempted or limited, employees will not be subject to a
job transfer that requires moving residence. Under these programs, morethan 98% of employees who take parental leave return to work (100% formales, 98.8% for females) (fiscal 2019 results).
Furthermore, we have established programs for rehiring employees
who previously left the company for reasons of childbirth or family care.

KDDI

Pregnancy

Telework program(Working at home)

Content

Support System for Balancing Work and Family Life

Restrictions on overtime work
Exemption from late-night work

▪ Program for Work-Family Care Balance
All programs are available to both men and women

Accumulated annual holidays
Employee whowants to take acertain period oftime off work forfamily care

Familymemberin need ofcare

Short leave

Family care leave (five days / year per eligible family member, or 10
days / year if more than one family member is eligible)

Long leave

Wants to reduce working hours
Employee whowants to provide
family care while
continuing to work

(max. 20 days)

Home care absence (365 days per family member)
Shortened working hours for family care *(until care is no longer required)

Wants to restrict or be exemptedfrom overtime work

Exemption from or restriction on overtime work *Wants to be exemptedfrom late-night work

Exemption from late-night work ** Can be applied together

66

KDDI Sustainability Report 2020

KDDI Sustainability Report 202067

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 4

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 4

Materiality 3

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Labor Practices

Efforts to Support Childcare and Family Care

Activity &Results

KDDI▪ Efforts to Support Childcare and Family Care (Excerpt)
Measures
Support for male employees’
participation in childcare

Supporting a balance between workand childcare

Supporting a balance between workand family care

TargetContent

Male employees with spouse
expecting to give birth

Grant paid paternity leave on the expected delivery date or one month following the birth(up to three days, on a day-by-day basis)• FY2019 result: 202 persons (acquisition rate: 69.4%)

For all employees

Hold seminars by outside experts on searching for nursery schools, which provides recent trend
and know-how

Employeeswith childcare responsibility

Subsidies for babysitting fees

For all employees

Provide seminars on a good balance between work and nursing care and post a handbook
describing internal support programs on the intranet

Note: Only measures that exceed the legal standards are described here as examples.

Usage of Childcare and Family Care Support System

KDDI▪ Usage of Childcare and Family Care Support System (KDDI)

Unit: person

ProgramMale /
FemaleFY2015FY2016FY2017FY2018FY2019Maternity leave

Female

185

181

164

135

136

Paternity leave (for men only)

Male

269

279

282

255

202

Male

14

16

25

27

29

Female

281

276

270

247

239

Male

100%

100%

100%

100%

100%

Female

96.6%

99.0%

94.4%

98.9%

98.8%

Male

100%

88.9%

93.3%

92.9%

−

Female

96.5%

99.0%

98.0%

97.7%

−

Parental leave of absence

Reinstatement after parental
leave of absence*1
Childcare
Retention after parental leave ofabsence*2
Shortened working hours forchildcare

Sick / injured childcare leave

Home care absence

Familycare

Results

Family care leave

Shortened working hours forfamily care

Male

2

1

3

6

3

Female

417

440

458

469

497

Male

290

344

429

471

439

Female

344

445

496

522

484

Male

7

8

8

12

7

Female

6

5

4

6

6

Male

90

107

133

180

175

Female

63

87

117

113

118

Male

4

1

1

3

3

Female

2

2

2

6

11

Expanding Employment Opportunities andAdvancement of Persons with Disabilities

KDDI

Policy &System

Support System for Employeeswith Disabilities

KDDI

SystemAt KDDI, many employees with disabilities are each playing an importantrole in their respective workplace. As a role model of a person with disabilities who plays an active role in a company, three KDDI employees, themost among the participating companies in ACE Award, received its
grand prix prize.
Established in 2008 as a special subsidiary to provide opportunities
for many people, KDDI Challenged is promoting the independence andsuccess of work of employees with disabilities, aiming to expand and create the types and scope of duties, including the operations of the threecafes. With the aim of increasing the employment of persons with intellectual disabilities as required under the law in fiscal 2018, we have been
continuing to expand job areas with a focus on developing diverse occupations, by understanding their characteristics mainly through pre-employment training; so that each can fully excise their ability in a work area inwhich they excel. At KDDI, the rate of employment for persons with disabilities is 2.53%*1 (as of June 2020), which exceeds the legal requirement (2.20%).

The Act on the Elimination of Discrimination Against Persons with Disabilities, enacted in Japan in 2016, stipulates the need of rational consideration to be taken to eliminate barriers in the life of people with disabilities
as much as possible.
To ensure that employees with disabilities can lead stable professional
life that matches their abilities and disabilities, we strive to create supportive work environment for them by providing support to them based on aquestionnaire survey, while preparing a guidebook for their supervisors.

Questionnaire surveys

We conduct questionnaires for all employees withdisabilities to assess factors such as the inconveniences they face in the company and changes intheir conditions, and based on these opinions changes are incorporated into their work environments.

*1 Includes KDDI Challenged (special subsidiary) and KDDI Engineering

Guidebook for supervisors

To understand, accept and treat employees with disabilities according to the need of each of the employees, we provide a guidebook for their supervisors.

Guidebook forcommunication with
employees with hearing
difficulties

This guidebook, which was created with the participation of employees with hearing difficulties, is posted on the intranet to provide easy-to-understand explanations on the rules of sign language interpretationand how to support summary writing in the workplace.

Support in creating
network

Help employees with disabilities build a network withpeople with disabilities who work for other companies
and have opportunities to grow themselves throughparticipation in external seminars targeting them.

Introduction of an app for
persons with hearing
difficulties

We introduced the UDTalk speech translation app tofurther ensure the access to information by employees with hearing difficulties▪ Work Status of Employees with Disabilities
Work location

Work roles

KDDI Challenged

Work handled under contract from the KDDI Group, including
manually disassembling mobile phones, performing maintenance on business mobile phones, handling accounting procedures, PC kitting*2, facility maintenance and operating Refresh
Room and Café Challenged

KDDI Challenged
Osaka Office

Cleaning (morning), manually disassembling mobile phones(afternoon), and operations of refresh rooms and Café
Challenged*2 Refers to the process such as setting up a PC operating system and installing applications▪ Examples of Support for Employees with Disabilities
Measures

Content*1 (Total number of regular employees who returned to work after parental leave of absence) ÷ (Total number of regular employees who planned to return to work after parental leave of absence) × 100*2 (Total number of regular employees who remain at KDDI 12 months after returning to work after childcare absence) ÷ (Total number of regular employees who returned to work after childcare absence) × 100

68

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

69

Top Message

Message from Executive Officer of Sustainability

Materiality 4KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality

Materiality 4

Materiality 3

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Rewarding Workplaces for Diverse Talents• Promotion of diversity and inclusion • Human resource development and career development• Pursuit of employee satisfaction • Promotion of health-focused management

Labor Practices

Promoting Active Role of Elderly Workers

Policy &System &ActivityKDDI

As we enter the era of 100-year lifespans, KDDI has adopted systems that
help its employees aged 50 years or older can play an active role in aworkplace. We have established a post-retirement re-employment program for employees who have reached the age of 60 and satisfy certain
requirements, encouraging them to work as non-regular employees untilage 65 at the latest. This system employs open recruiting, allowing theemployees to select their desired job type and activity while creating amechanism for former full-time employees to make full use of their skills
and experience in various workplaces.
For employees nearing the retirement age, we also hold seminars thatinspire them to think about their life and work styles after 60. Furthermore,
to create an environment to help senior employees further broaden theirfield of activities, since fiscal 2019 we have offered internal open recruiting
opportunities and supported career development for employees aged 50
years or older.

Advancement of Foreign Employees

Policy &SystemKDDI

To ensure that employees from countries other than Japan can work
comfortably in Japan and make full use of their abilities, we provide a variety of information about obtaining permanent resident status and programs relating to dependents and employee pension. In light of religious
diversity, a space for worship is prepared in a workplace. In fiscal 2016,
we held discussions with them to improve the working environment as thecompany expands globally. We provide employees with a guidebook explaining multi-culture in an easy-to-understand manner to ensure that
non-Japanese employees are not discriminated for race and religion.

KDDI’s Approach—Sound Labor-Management Relations

KDDI

PolicyWe aim to further promote decent work for all employees by working
toward improving labor-management relations through honest discussions
and negotiations with representatives of all employees.

Status of Union Membership (KDDI)KDDI

Results

FY2019Total number of union members*
Union participation rate
(Percentage of employees covered by labor agreements)

10,11399.0%* Includes KDDI’s currently serving regular and contract employees, as well as employees on loan
from the company

Creating Sound Labor–Management Relations

KDDI

PolicySigning of Union Shop Agreement and Cooperation between Laborand Management
We guarantee the right to freedom of association and collective bargaining. We adopted a Union Shop Agreement that requires all employees inJapan, except for managers and non-regular employees, to join the KDDI
Workers Union starting in January 2012, and we signed the Labor-Management Relations Agreement, Union Activities Agreement and Collective
Bargaining Agreement with the KDDI Workers Union.
Regarding items with a significant influence on the treatment of employees, such as changes in the organizational structure and systems relating to human resources, we hold discussions with the union, and theirconsent is obtained before implementing any changes. Various issues relating to the improvement of working environment are also discussed between labor and management through collective bargaining, working-level
negotiations, labor-management committee and the like as required, andin fiscal 2019 we had 77 meetings in total. Such discussions will be held
as frequently as possible in fiscal 2020 as well. The KDDI Workers Union
provides union members with information about the content of negotiations between labor and management. Agreements reached in previous
sessions (benefit to both sides) include: increase in fixed monthly pay, bonus payment based on company performance, enhancement of the work
shift interval rule, making shortened working hours for parents more flexible, eliminating the time limit on shortened working hours for caregivers,
enhancement of the system for accumulating annual paid leave, promotion of health-focused management and promotion of harassment preventive measures.
In addition, through the Agreement on Handling of Personnel Transfers, we have stipulated in the Labor Agreement that an employee shall be
notified at least five days before a personnel transfer is officially announced, and we have established a system for receiving complaints fromthe person concerned.

Pension System

KDDI Group System

We have introduced our own retirement benefit and pension system,
which is managed by the KDDI Pension Fund (a separate corporation).
The KDDI pension plan offered to employees is structured as a defined-benefit pension plan, and the entire amount is borne by the company (392,379 billion yen* as of the end of March 2020). KDDI Pension Fundmanages the assets to be granted appropriately in the future.
We strive to provide fair and strict management of the fund to ensurea stable life for fund subscribers and recipients in the future.
* Fund assets for the entire KDDI Group (including the companies affiliated with the fund)Wellness Benefits (for employees)

KDDI

SystemVarioussystems•T wo-day weekends (Saturday, Sunday, holidays)
126 days off per year (weekends, holidays, end and start of year:
FY2019 results)• Annual paid leave (20 days. *Varies according to work attendance
rate, and, for the first year of employment, to the month an
employee joins the company.)• Free vacation system (promoting taking five consecutive paidvacation days)• Special leave (for funeral, marriage, birth, childcare, etc.)• Refresh vacation• Maternity leave• Childcare and caregiving leave, etc.

Insurance

Health insurance, pension insurance, employment insurance, labor
accident insurance, etc.

Assetcreation

Various asset creation and accumulation systems, employee
stock-holding association

Welfareassociation

KDDI Group Welfare Association (mutual aid benefits, support systems for daily life, group insurance, group life insurance, sports
clubs, golf courses, department store perks, coupons for themeparks and resorts, etc.)

Residential
investments

Affiliated home loans

Resorts

Around 75 contracted resorts nationwide

Status of Workplace Injuries (KDDI)KDDI

Results

FY2015FY2016FY2017FY2018FY2019Number of workplace accidents

Unit: case

20

21

23

20

19

Number of serious workplace accidents during construction

Unit: case

0

0

0

0

0

Frequency rate*1

0.62

0.78

0.82

0.77

0.77

Severity rate*1

0.00240.01020.00380.00520.0065

0.20

0.19

0.28

0.15

0.16

Lost time injury frequency rates*2*1 Calculated based on the formula specified in the Survey on Industrial Accidents of Japan’s Ministry of Health, Labour and Welfare*2 LTIFR: (Lost time injuries frequency rate is the number of workplace accidents) ÷ (the cumulative hours worked) × one million (lost time is defined as any period of one day or more)

Overtime Hours, Paid Holiday, Average Annual Salary, etc. (KDDI)KDDI

Results

FY2015FY2016FY2017FY2018FY2019

29.9

27.5

19.6

19.0

19.0

Average overtime hours per month*1

Unit: hours / month

Average overtime allowance per month*1

Unit: yen / month

100,197

96,39565,87963,54264,943

Total annual actual hours worked (average)*1

Unit: hour

1,941.6

1,919.2

1,892.7

1,871.4

1,861.2

Unit: Number of days granted

19.8

19.7

19.7

19.7

19.7

Unit: Number of days obtained

13.1

12.8

13.5

14.2

13.2

Average rate of paid holiday taken

Average annual salary*2

Unit: %

66.3

65.1

68.5

71.9

66.9

Unit: yen

9,510,045

9,532,136

9,363,399

9,528,103

9,300,662*1 Applicable to KDDI employees in non-managerial positions*2 Average annual salary includes bonuses and extra wages. There is no difference in total compensation (average annual salary) between female and male employees.

70KDDI Sustainability Report 2020

KDDI Sustainability Report 202071

Top Message

Message from Executive Officer of Sustainability

Materiality 5KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Respect for Human Rights and Fairness in Business• Pursuit of sustainable procurement • Prevention of corruption and bribery• Respect for workers’ rights • Promotion of fair and proactive communication

Human Rights
KDDI’s ApproachKDDI Group

Social Issue
As economic activities of companies around the world expand globally,
there is growing scrutiny in global society, concerning corporate attitudes toward human rights and the impact of business activities onhuman rights, including the establishment of the UN Guiding Principles
on Business and Human Rights. Not only companies and their groupcompanies but also their entire value chain are required to take measures to respect for human rights.
In terms of fair business practices, issues that need to be addressed include anti-bribery and anti-corruption measures, andcountermeasures for organized crime groups.

PolicyOur Risks and Opportunities
We assume there are social and economic risks where, through the
products and services provided by KDDI, customers become involved in mischief or crime committed through the internet, cell
phones, or smartphones. In particular, we are concerned that therights of the socially weak (children, the elderly, the disabled, etc.)
may be infringed. In educational environments, there is a growing
need for data literacy education to enable children to properly use
ICT equipment without getting caught up in mischief or crime.
 e are aware that turning a blind eye to human rights violations canWdamage the value of corporate brand and hamper the developmentof a sustainable society. We believe that efforts to eradicate humanrights violations from business activities and from the wider society
can contribute to KDDI’s business growth.
In terms of privacy and data protection, there are risks that KDDI and
its business partners may retain, process and access personal information beyond specified purpose. These risks may increase especially in countries and regions with weak rule of law or lacking strictlaws protecting data.

Instruct response

Corporate Risk Management Division

Audit(Business execution)

Sustainability
Committee

Internal Control Division

KDDI Guidelines for Responsible Supply Chain

Executive Officers

ReportFinancialinformation

Web Link

Instruct /Supervise

ReportInternal Audit Division

KDDI Group Human Rights Policy

Deliberate /Report on
Importantmatters

ReportDisclosure Committee

Web Link

Full-time Directors

ReportHuman Rights Subcommittee

Report(Deliberate on important matters)

Instruct response

Web Link

ReportReportInformation Security Committee

PolicyRepresentative Director
Corporate Management
Committee

ReportAudit & Supervisory Board
Member’s Office

Audit

ReportKDDI Sustainable Action P.12 - 29
Human Rights P.73 - 75
Youth Education Activities P.75
Compliance P.76 - 78
Supply Chain Management P.79 - 81

KDDI Group

Audit

Judgment on
appropriateness of accounting audit

Instruct response

Initiatives

Elect /
Dismiss/
Supervise

Human Rights Subcommittee

KDDI Sustainability Report 2020

PolicyAudit &
Supervisory Board

Environmental Subcommittee

Respect for workers’ rights
Prevention of corruption and bribery
Pursuit of sustainable procurement
Promotion of fair and proactive communication

KDDI GroupElect / Dismiss

Accounting
Auditors

ReportAudit

Deliberate /Report on
Importantmatters

Elect / Dismiss

ReportBoard of Directors

Instruct response

FY2020 Material KPIs

Moving Forward

72

PolicyElect / Dismiss

Green Plan Subcommittee

Web Link

KDDI Group

General Meeting of Shareholders
Elect / Dismiss

Deliberateissues

FY2020 Material KPIs

System▪ Organizational Structure

Business Ethics Committee

 DDI Smartphone and Mobile Phone Safety Classes are held byK
certified lecturers who go around to schools all over Japan. Throughthese classes, we teach children how to safely communicate throughsmartphones and mobile phones. We also raise awareness andfoster greater understanding of human rights on the internet.

KDDI Code of Business Conduct (Basic Principles)KDDI

Remuneration Advisory Committee
Nomination Advisory Committee

 e established the Business Ethics Helpline, which is available anyW
time, to receive reports or provide consultation regarding violations

 ith our suppliers and all other stakeholders, we build partnerships onWmutual trust and conduct business in a fair and equitable manner. We also
use tools such as Responsible Procurement Surveys to ensure suppliers’
compliance regarding matters such as human rights and conflict minerals.

Web Link

Management Framework
At the Sustainability Committee (convenes twice a year) chaired by the
President, KDDI determines the policy on activities related to humanrights, develops and reviews the structure for their promotion and checks
their progress against targets. We have also set up a Human Rights Subcommittee under the Sustainability Committee to have discussions on
promotion of respect for human rights in accordance with the KDDI Group
Human Rights Policy.
We established the Business Ethics Helpline, which is available anytime, to receive reports or provide consultation regarding violations ofbusiness ethics, laws, or regulations through an internal or external contact point established in collaboration with external experts. Contact points
can be reached by e-mail, phone call or letter, in multiple languages.
We have also established a Sexual Harassment and Human Relationships Hotline staffed by external specialist counselors, an Employee Counseling Center staffed by internal counselors and a Harassment Hotline
staffed by employees at the Human Resources Department. In addition, in
the KDDI Guidelines for Responsible Supply Chain, we prohibit forcedlabor, inhumane treatment, child labor and discrimination, and our business partners are requested to understand and follow the guidelines.
Any stakeholder can discuss or report their concerns. Privacy of thosereporting concerns is protected at any contact point. Reports can bemade anonymously. Strict confidentiality is observed to protect thoseseeking help by ensuring that they will not suffer any detrimental treatment
as a result of raising a concern.

Policyties. The KDDI Group Human Rights Policy, established in 2016, also declares
our efforts in all group companies to respect international standards such as
the Universal Declaration of Human Rights, as well as to prevent and reduce
negative influences on human rights and to promote education on the issue.
We believe that diversity and inclusion is important for a company toachieve sustainable growth, especially in driving innovation. The KDDI
Group Philosophy includes a vision of embracing diversity to facilitate theunderstanding.
We are also aware that issues surrounding the protection of personal
information and the invasion of privacy by a government uniquely expose
the ICT industry to human rights risks. We are determined to fulfill our social responsibility to address these issues by leading an industry-wide drive.

Advise e have set up a governance framework consisting of a range ofW
committees, including the Business Ethics Committee and Sustainability
Committee, to drive our efforts. We also run initiatives to enhance
our employees’ understanding and practice of the KDDI Group
Philosophy and the Code of Business Conduct throughout the year.

of business ethics, laws, or regulations through an internal or external contact point established in collaboration with external experts.
Contact points can be reached by e-mail, phone call or letter, in multiple languages. To protect whistleblowers, reports can be madeanonymously, and we work to protect privacy in surveys.

We at KDDI are striving to avoid discrimination based on race, faith, gender, social status, religion, nationality, age, sexual orientation, gender
identity, mental / physical disabilities, pregnancy, child birth as well as
tackling and eliminating labor practices that violate human rights, such as
forced labor and child labor.
The KDDI Group considers the International Bill of Human Rights andthe International Labor Organization (ILO) Declaration on Fundamental
Principles and Rights at Work to be the most fundamental policies for human rights, and set the policies and take initiatives in reference to the UN
Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.
The KDDI Code of Business Conduct, which serves as a guideline for behavior of officers and employees, defines our basic principles on respecting
human rights and individual characteristics throughout all our business activi-

KDDI Group

Consult

Management Framework
We at KDDI respect the KDDI Code of Business Conduct and theKDDI Group Human Rights Policy. We will eliminate discrimination
based on race, faith, gender, social status, religion, nationality, age,sexual orientation, gender identity, family responsibilities (including
pregnancy) or (dis)abilities as well as correcting and eliminating labor
practices that violate human rights, such as child labor and forced labor.

KDDI’s Approach (Human Rights)

Business Divisions / Group Companies

KDDI Sustainability Report 202073

Top Message

Message from Executive Officer of Sustainability

Materiality 5KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Respect for Human Rights and Fairness in Business• Pursuit of sustainable procurement • Prevention of corruption and bribery• Respect for workers’ rights • Promotion of fair and proactive communication

Youth Education Activities

Human Rights

KDDI’s D&I Promotion System

KDDI

SystemIn 2008, we established the Diversity & Inclusion Department in the Human Resources Department. With the president as the top decision-making authority, we are engaged in company-wide efforts to promote diverse
work styles and the professional advancement of women, employees withdisabilities and LGBT people.
By specifying promotion of diversity and respect for human rights in
the KDDI Group Philosophy and the KDDI Code of Business specify, we
have clearly positioned diversity promotion as a management issue.
▪ KDDI’s D&I Promotion System
President Makoto Takahashi
The top decision-maker for D&I promotion
Direction / Report

Direction / Report

Officers

Corporate Sector
Human Resources Division
Human Resources Planning
Department(General Managers of Corporate Sector)

Direction / Report

General Managers
of each business sector /division / department
Direction /ReportSelection /developmentof eligible
employees

Sharing of
progress ofdevelopment

Persons in chargeof human resources
representing each
Cooperation
department

Diversity & Inclusion Department
Department in charge of D&I Promotion
Supervisory responsibility:
General Manager, Diversity &Inclusion Promotion Department

Employees

Promotion of Diversity
and Inclusion

Human Rights Impact Assessment

KDDI Group Activity

KDDI has identified human rights issues that it needs to address in accordance with the UN Guiding Principles on Business and Human Rights,
and reflected them in reviewing initiatives of human rights due diligenceand considering relevant measures.
In fiscal 2019, we worked together with the nonprofit organization
BSR* to exercise human rights due diligence. We identified and assessed
actual or potential adverse human rights impacts that we may have on our
stakeholders through our own business activities and in our value chains.
As part of human rights due diligence, we, in cooperation with BSR,
held lectures on Social Trend Surrounding Business and Human Rights for
managers of the five relevant departments to learn the background of theassociation between business and human rights, human rights risks thatcompanies are facing today and what actions they need to take, and thus
helped them raise awareness and consider future measures.
* BSR(Business for Social Responsibility)
As a BSR member company since 2014, KDDI has participated in conferences organized by
BSR on sustainability agenda including human rights, exchanged views with a variety of companies and organizations, and reflected this experience in promoting its own initiatives.

Assessment Process
BSR human rights impact assessment covers all business activities byKDDI. First, we conducted desktop research on human rights risks facing
KDDI based on its Sustainability Report, website and other available publications, media reports and NGO research data about human rights issues
facing telecommunications business, and conducted analysis and made alist of internal control processes for each of the human rights risks identified. Then we interviewed the five relevant departments, asked their views
about specific initiatives and concluded the assessment.
Major Risks Identified
Main potential impacts on human rights identified are as follows:• Consideration of human rights in supply chains, such as forced, slave,
restrained or child labor• Privacy and data protection, children’s cyber safety• F reedom of expression in conflict-affected countries and high-riskcountries
Future Initiatives
Prioritize identified impacts, develop action plans by department, andimplement initiatives to reduce risks in cooperation with stakeholders Continue to monitor the effectiveness of the action plans, and exercise PDCA
cycle of human rights due diligence.

Employee Awareness RaisingKDDI

ActivityKDDI and our group companies in Japan strive to further raise awarenessof employees of human rights based on the KDDI Code of Business Conduct. Our awareness-raising initiatives include the provision of harassment
prevention seminars (compulsory to all line managers), regular e-mailnewsletters about the Code of Business Conduct and the Harassment
Prevention Guidebook posted on the intranet.

Initiatives to Promote LGBT Equality

KDDI Sustainability Report 2020

Activity

As shown in the enactment of a law permitting persons with gender
identity disorder to change their gender status in Japan and the legalization of same-sex marriage in increasing number of countries and regions,attitudes toward LGBT* equality are changing. However, businesses stilllag behind in the understanding of and support for LGBT rights.
In light of this, we at KDDI have been engaging in activities to promote
LGBT awareness within the company since fiscal 2013 in the effort toadvance understanding and spread awareness among employees.
* LGBT: Collective term for lesbian (L), gay (G), bisexual (B), and transgender (T) people. Genderminorities include other people with identities other than LGBT, but for the sake of convenience inthis report, LGBT refers to all gender minorities, including LGBT.

Increase Allies
We at KDDI are engaged in an initiative to increase allies — supporters ofLGBT people. To LGBT people, the presence of allies around them boosts
confidence. Allies can also promote dialogue about the issue in theworkplace.
We give employees who have declared to be allies KDDI ALLY stickers
that they can display prominently to show their commitment to the cause.
As of June 2020, around 2,900 employees have declared themselves allies
and are working on making our workplace a safe, happy place for LGBT
people to work in. We also offer networking opportunities to LGBT people.
Other Initiatives
Initiatives
Inclusion of KDDI
Code of BusinessConduct(basic principle)

Content
The code enshrines the principle of no discrimination or violation of dignity on the basis of sexual orientation and gender identity, in addition to gender, age or nationality, which
is widely communicated within and outside the company.

Awareness-raising
Seminars and e-learning courses to improve the underactivities for facilitating standing of LGBT issues have been conducted on an onunderstanding
going basis since fiscal 2013.

KDDI Basic Guidelines Concerning Safeand Secure Communication for Young People

KDDI

PolicyWe take Unicef’s Convention on the Rights of the Child (CRC) and Children’s Rights and Business Principles seriously. With regard to the CRC inparticular, which codifies children’s right to survival and development, we
ensure that children have access to education and do not face a digital
divide. Regarding Children’s Rights and Business Principles, we are committed to ensuring that KDDI’s services come with safety measures that
respect and promote children’s rights.
We offer safe and affordable services to young people and run awareness campaigns. We are committed to protecting children’s rights as we
endeavor to create a society where children can enjoy mobile and internet
connectivity.

Initiatives through KDDI Smartphone
and Mobile Phone Safety Classes

KDDI

ActivityKDDI sends certified lecturers to visit elementary, middle, and high schools
all over Japan. The lecturers teach children rules and manners to abide bywhen using a smartphone or mobile phone and go over teachable examples of trouble and incidents related to smartphones, mobile phones, andthe internet. The classes are designed to enable children to use their own
judgment and thereby avoid risks. Since its launch in fiscal 2005, a total of
33,000 classes have been held with over 6,110,000 attendees. There is awide variety of human rights-related risks posed by the internet, and people need to be careful not to spread misinformation or write hurtful comments on social media, post identifying information, or too easily trust
people met online. These topics are covered by the lectures, and we areworking to enable children to safely use information technology while protecting their human rights.

Web Link

Community Participation: List of Initiatives

If the company regards an employee as having his / hersame-sex partner:
Change of definition of• The employee is regarded as having his / her spouse in
spouse and children,
all internal programs (since April 2017).
and application of• Any child between the employee and his / her same-sex
internal regulations
partner is regarded as his / her child under all internal
regulations (since June 2020).
Considerations inwork environment

Transgender employees are encouraged to use their chosen working names, receive tailored health checks anduse universal toilets

Promoting the• Participation in forums and other events related to LGBT
understanding ofissues and showcasing KDDI’s initiatives
LGBT issues in society • Donations to LGBT support groups
The eligibility of family-oriented services such as au Family
Application of au Fam- Discount has been expanded to include same-sex partily Discount scheme
ners when formal certification of same-sex partnership isprovided.

External Recognition

Web Link
74

KDDI

KDDI

Activity &Results

External Recognition
KDDI Sustainability Report 202075

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 5

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Respect for Human Rights and Fairness in Business• Pursuit of sustainable procurement • Prevention of corruption and bribery• Respect for workers’ rights • Promotion of fair and proactive communication

ComplianceKDDI’s Approach(Compliance)

KDDI Group

PolicyWe recognize that in order to fulfill our social responsibilities through ourbusiness activities, raising compliance awareness throughout the group isa fundamental corporate management issue.
As a global corporate group, we continue to further enforce ourgroup-wide compliance framework.

KDDI Group Compliance andEnforcement Framework

KDDI Group System

We created the KDDI Code of Business Conduct to encourage the ethicalbehavior of employees along with a compliance mindset. It is published on
the intranet to ensure that it is shared and practiced, enabling employees
to check it whenever they are unsure what action to take. Also, we established the KDDI Group Business Ethics Committee as a decision making
body for KDDI Group’s compliance related matters. The KDDI Group
Business Ethics Committee is chaired by the Chairperson who is a Representative Director, and members include directors and additional nominees appointed by the chair as required. They hold a meeting once every
half-year, and, in addition to assessing the conditions of each group company, the committee builds and supports the enhancement of complianceframeworks. The committee is also responsible for helpline issues, corruption prevention and compliance issues, such as breaches of competition
laws.
In addition, the committee formulates policies on raising awareness,
discusses countermeasures in case compliance violations occur and is responsible for the disclosure of such information as well as the preventionof recurrence. Reports on their activities are made available to all employees via the intranet.

Corporate Management Committee

KDDI Group Business Ethics Committee Members
Chair: Representative Director(Other members are appointed by the chair)
Secretariat: General Administration Department,
General Administration Division

ReportFeedback /Instruction,etc.

Examples of Initiatives in FY2019• Target: All KDDI employees
Promotion of the KDDI Group Philosophy• Target: All KDDI employees
Monthly email newsletter related to promoting the KDDI Code of BusinessConduct• Target: Managers, Group leaders
Seminars and training for violation case studies
Harassment-prevention seminars• Target: New line managers
Training related to bullying and harassment• Target: Group company executives
Training for learning mindset as a leader, risk management in corporate
operations, and legal and accounting knowledge

Web Link

Sustainability Promotion Framework(KDDI Group Philosophy, KDDI Code of Business Conduct)

Business Ethics Helpline(Grievance Mechanism)

KDDI Group System

We established the Business Ethics Helpline in 2006 to serve as a contact
point for all employees of KDDI, KDDI Group companies and business
partners who have questions or concerns about business ethics and legal
compliance, including human rights issues. The helpline is available anytime and can receive reports through an internal or external contact point
established in collaboration with external experts (Reports can be received
by e-mail, phone call or letter, in multiple languages).
Furthermore, we have enabled anonymous consultation and reporting
based on the Whistleblower Protection Act enacted in Japan in April 2006.
In 2019, there were 469 consultations and reports, but there was noconsultation or reporting of serious issues that require external announcement.
The KDDI Group Business Ethics Committee investigates the issues
consulted on and reported as required while protecting privacy, and when
the problems are detected, the committee members as well as the management team and the Audit & Supervisory Board members review the report and take corrective actions along with measures to prevent recurrence.
If it is identified that its business activities has caused, or had any adverse impact on human rights, KDDI ensures that it will provide relief for
those affected.
▪ Business Ethics Helpline
Whistleblowers(Employees of the KDDI Group or partner companies)
Report /consultation

Report back /response

Notificationof receivinga report*
Report back /response

Report /consultation

Report back /response

External contact point
Legal offices contact point foroverseas subsidiaries

Investigation / analysis /improvement /recurrence prevention

Basic Policy for Eliminating OrganizedKDDI Group
Crime Groups and Status of Implementation

PolicyOur Basic Policy for the Creation of Internal Systems takes a firm stand on
countering organized crime groups.
In addition to rules defining initiatives for blocking off any relations withsuch groups, the KDDI Code of Business Conduct, which defines basic
principles to be followed and enforced by all officers and employees, takes
a firm stance against organized crime groups, rejecting any requests forillicit funds and refusing to comply with any demands.

Web Link

Basic Policy for Constructing an Internal Control System

Anti-Corruption Measures

KDDI Group System

To prevent corrupt practices, the KDDI Code of Business Conduct defines
the principles of promoting fair business activities and the conscientious
performance of duties and prohibits activities such as bribing politicians
and public officials, along with other similar types of corruption.
Specifically, this includes any business entertainment, gift and invitation given to a public official in the course of business with governmental
agencies that is prohibited under the National Public Service Act and otherapplicable laws and regulations.
KDDI has established that, when dealing with overseas governments
and companies, employees will not provide any business entertainment,
gift or invitation as stipulated in the UN Convention against Corruption as
well as the laws and regulations of the relevant countries and regions
against foreign corrupt practices and unfair competition. Any breach will
result in disciplinary action according to the company regulations. In orderto prevent these violations, we use e-learning courses and e-mails to inform all employees and raise their awareness.
Procurement Department
We also urge business partners to comply with the KDDI Guidelines for
Responsible Supply Chain, which defines rules for prohibition of corruption, bribery, abuse of power and giving or receiving illicit funds.

Relevant department’s managers

ReportKDDI Group Business Ethics Committee

Activity &Results

KDDI Group
Business Ethics Committee

President, KDDI CORPORATION

Consult

KDDI GroupInternal contact point▪ KDDI Group Compliance and Enforcement Framework

ReportCompliance Education, Training
and Awareness Raising• Formulate policies foreducational activities• Discuss countermeasures incase compliance violations
occur• Disclose information outsideof the company• Deliberate on measures toprevent recurrence* Consultations that the external contact point received are relayed to the internal contact point,
keeping anonymity for the whistleblowers▪C ompliance Consultations Received in the Last Two Years (KDDI Group) Consultations

Unit: case

FY2018FY2019Contact (Anonymous)

Compliance consultations

330

469

Business Ethics Helpline

Breakdown: harassments

151

173

Breakdown: other compliance violations

179

296

ReportFeedback

Secretarial Department
For any political donations we make, we observe the Political Funds Control Act and follow the KDDI Code of Business Conduct and the KDDI
Guidelines for Responsible Supply Chain.
In fiscal 2019, we made political donations totaling 6 million yen in Japan, and there were no cases of legal action against us concerning corruption or bribery.

All Employees of KDDI Group76

KDDI Sustainability Report 2020

KDDI Sustainability Report 202077

Top Message

Message from Executive Officer of Sustainability

Materiality 5KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

Respect for Human Rights and Fairness in Business• Pursuit of sustainable procurement • Prevention of corruption and bribery• Respect for workers’ rights • Promotion of fair and proactive communication

Supply Chain Management

CompliancePreventing Anti-Competitive Behaviors
The KDDI Code of Business Conduct defines rules that prohibit anti-competitive behaviors, and we make efforts to ensure that all employees comply with competition laws.
In addition to competition laws, we stipulate that local laws and regulations in each country and region on labor, tax, the environment, monopolies and consumer protection must be examined thoroughly to ensure fullcompliance.
Under the KDDI Guidelines for Responsible Supply Chain, we demand
our business partners to not engage in any activities that inhibit fairness,transparency or freedom of competition.
However, in March 2020, the Ministry of Internal Affairs and Communications gave KDDI and UQ Communications an administrative guidance,
requesting for instructions to be given to distributors and other necessary

KDDI Group

Policymeasures for correction of an excessive customer retention practice, on
the basis that the distributors sold mobile phones to customers at discounted prices below the limit under the revised Telecommunications
Business Act, effective in October 2019.
We have been taking measures to prevent similar practices from occurring again, including further explanation of the revised Telecommunications Business Act to all distributors, online trainings for agencies’ staff,
having persons in charge of the guidelines in place at distributors.
In fiscal 2019, there were no other legal actions against us concerning
anticompetitive or monopolistic conduct.
We fully adhere to these related regulations and continue the appropriate business operations.

KDDI’s Approach(Supply Chain Management)

Basic Approach to Tax Practice
We at KDDI Group pursue the satisfaction and benefits of our customers
while fulfilling our social responsibilities not only by complying with international rules and applicable tax laws and regulations in all operating countries and regions, but also by complying with and following the spirit of thelaw and paying tax appropriately to engage in tax fairness, and thereby
strive to maximize shareholders’ value.
In fiscal 2019, we paid 325,298 million yen of corporate income tax,
which accounts for 31.9% of gross income.
KDDI Group submits the Securities Report after undergoing accounting audits by external accounting auditors and obtaining approval of the
CFO (Executive Vice President, Representative Director / Executive Director, Corporate Sector) and the President.
As KDDI Group businesses become increasingly multinational andhave more international transactions, our top management, including thePresident, is working to develop and promote a tax strategy that properly
recognizes international tax risks and regards such risk as an important issue that is directly linked to management, while utilizing external specialists to have a deeper understanding of the latest tax updates. In addition,
the head office is engaged in education for employees across the world
and receives tax practice support from external specialists. With these initiatives, we strive to maintain and improve tax governance.
Also, with regard to the tax returns it prepares, KDDI has them reviewed by an external tax accountant corporation and obtains approval of
the CFO (Executive Vice President, Representative Director / Executive Director, Corporate Sector) before submitting them to the tax authorities.

KDDI GroupTax Transparency and Relations with Tax Authorities
To maintain the transparency of tax affairs, we prepare and submit an annual report on our activities by country in accordance with tax laws in Japan, while building trust relationship with tax authorities in each country byconducting timely and appropriate disclosure of tax-related information,such as a business summary report on the overall status of the Group’s
activities, and by making prior inquiries as required. With these initiatives,
we strive to reduce tax risks.
Efforts to Prevent Tax Avoidance
In accordance with OECD’s Action Plan on Base Erosion and Profit Shifting (BEPS), we are committed to ensuring proper tax payment in all operating countries including Japan, by aligning tax payments with the locationof our economic activity and value creation, in line with the revision of tax
regulations to tackle BEPS. We also prohibit the transfer of the tax base totax free or low tax rate countries and regions (so called “tax havens”) withthe purpose of excessive tax avoidance and work to make proper tax
payments in accordance with each country’s tax system.
Amount of tax paid KDDI Sustainability Report 2020

Unit: 100 million yen

FY2019
Japan

2,703

98.1%

Europe

32

1.2%

Asia

16

0.6%

North America, etc.

3

0.1%

2,754

100.0%

Total

78

Policy &SystemPolicyIn today’s world where globalization has progressed, corporate procurement activities are influenced by social issues around the world.
We believe that driving sustainability initiatives not only within the company but throughout our supply chain will make our business more sustainable. KDDI will further improve our responsible procurement standards
to strengthen partnerships with our business partners while collaboratingwith them to prevent human rights and safety and health labor issues fromoccurring.
In addition, we are enhancing the various forms of support we provide
to distributors, who are important partners.

KDDI Sustainable Procurement Policy

Responsible Tax Practice

KDDI

KDDI

PolicyAs a general telecommunications operator that supports social infrastructure, we have implemented supply chain risk management with all business partners inside and outside Japan in line with the KDDI Sustainable
Procurement Policy since February 2014 to fulfill our social responsibility
at a higher level and avoid procurement risks as far as possible. The policy
defines seven themes for appropriate supply chain management: Co-existence and Co-prosperity with Business Partners, Consideration of Global
Environment, Fair and Equitable Trade, Considerations for Human Rights
and Labor Environment, Fair Management of Information, Ensuring Quality
and Safety, and Co-existence with Society.
To offer satisfactory services to our customers and achieve the sustainable development of the company and society together with our business partners, we are extending our demands and support based on thispolicy to all business partners inside and outside Japan.
Additionally, KDDI investigates the scale, background, credibility, business conditions, financial conditions, etc., of potential business partners
using external investigative organizations, and if they meet a predetermined standard, we open business with them. In case of a serious violation of compliance, such as those related to human lives, we deal with issues, including conducting reviews of transactions, until corrective actions
are completed.
Since fiscal 2018, we have conducted Responsible Procurement Surveys targeting our tier-1 suppliers, through which we have surveyed on
problems regarding responsible procurement, including human rights violations and use of conflict minerals, of tier-2 and tier-3 suppliers as well. In
this way, we confirm each supplier’s compliance with the KDDI Sustainable Procurement Policy.

Web Link

KDDI Guidelines for Responsible Supply Chain
and Responsible Procurement Promotion System

KDDI

System

We established the KDDI Guidelines for Responsible Supply Chain as
guidelines for implementing its procurement policy and published them on
our website (in Japanese and English). The guidelines were formulated
based on the Responsible Business Alliance (RBA; formerly called theElectronic Industry Citizenship Coalition (EICC)) code of conduct and theSupply-Chain CSR Deployment Guidebook published by the Japan Electronics and Information Technology Industries Association (JEITA). The
guidelines provide criteria to consider in selecting business partners andprocurement items, not only for quality, price, delivery and stability of supply but also for environmental and social impacts.
We also conduct surveys targeting our leading business partners to
support their understanding of our responsible procurement initiatives andto communicate the situation and progress. In case of compliance violations committed by business partners, KDDI requests them to identify thecauses and requests improvement. We offer guidance and support action
if necessary.
Based on our Code of Business Conduct, we do not perform any
transactions with organized crime groups.

Web Link

KDDI Guidelines for Responsible Supply Chain

Web Link

Promoting Green Procurement

Conflict Minerals

KDDI

Activity

The U.S. government requires companies listed in the United States todisclose the use in their products of conflict minerals* or minerals producedin the Democratic Republic of the Congo and other disputed regions.
KDDI is not listed in the United States, but we at KDDI conduct surveys on problems to our responsible procurement to ensure that conflictminerals are not used.
* Conflict minerals are tantalum, tin, gold, tungsten and other minerals designated as such by the
U.S. Secretary of StateKDDI Sustainable Procurement Policy

KDDI Sustainability Report 202079Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 5

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

Respect for Human Rights and Fairness in Business• Pursuit of sustainable procurement • Prevention of corruption and bribery• Respect for workers’ rights • Promotion of fair and proactive communication

Supply Chain Management

Promoting Responsible Procurement

KDDI

Responsible Procurement Surveys
We have conducted a survey targeting our leading business partners using a Responsible Procurement Check Sheet since fiscal 2014.
The survey covers 42 items related to the seven themes, namely human rights and labor, safety and health, environment, fair and ethicaltrade, quality and safety, information security and contribution to society,as defined in the KDDI Supply Chain Responsible Procurement based on
the Responsible Business Alliance (RBA; formerly called the Electronic
Industry Citizenship Coalition (EICC)) code of conduct and the Supply-Chain CSR Deployment Guidebook (Check Sheet) published by theJapan Electronics and Information Technology Industries Association(JEITA). In addition to them, it also covers other items that KDDI deems
pertinent to the company. Through this survey, we make sure of sharing
the KDDI Sustainable Procurement Policy and other necessary information
with suppliers. In fiscal 2019, we asked our key suppliers representing

Activity

approximately the top 90% of the total value of orders to answer thesurvey and received responses from over 96% of them.
To gradually improve our responsible procurement standards while
maintaining stable procurement as a general telecommunications operator, we will further drive initiatives that are determined and redefined in thefour newly set categories, namely “Maintain and improve communication
with suppliers,” “Survey actual status of suppliers,” “Establish supply chain
management (SCM) based on responsible procurement” and “Update
rules and procedures.” Specifically, we will check the status of each supplier’s responsible procurement initiatives through a questionnaire, andtake necessary measures to reduce risks, for example by conducting
additional on-site research for suppliers with any risk from perspectives,
such as human rights and labor, quality and safety, and environment.

▪ Establishment of KDDI Sustainable Procurement Policy and Improvement of SCM

We aim to achieve both gradual improvement of our responsible procurement standards and stable procurement as a general telecommunications operator
through establishing KDDI Sustainable Procurement Policy and improving SCM* in cooperation with suppliers. * Supply Chain Management
FY2020Redefine KDDI Sustainable Procurement Policy

Viewpoint

Maintain and improve communication with suppliers

FY2020H1

FY2022
Expand / deepen the scope of SCM initiatives

FY2021
Implement new SCM measures
FY2021
H2

surveyH1

FY2022
H2

surveyOn-site research

H1

H2

surveyOn-site researchOn-site research

Survey actual status of suppliers

Determine areas to be probed

Detailed research of areas
to be probed

Expandand / or deepen the scope

Establish SCM

Examine proposed measures

Implement measures

Further development

Revise KDDI Sustainable Procurement Policy

Revise contracts, agreements,
etc.

Update rules and procedures

Revise guidelines

Visit, exchange views with, and conduct inspection of tier-1 suppliers
We make sure that we visit a supplier’s worksite, exchange view andshare information about responsible procurement initiatives in a bid tobuild a better partnership with the supplier. In fiscal 2019, we conducted
inspections of a total of two companies.
Using the KDDI Industrial Waste Management Guidelines, we hold regularinspections each year of the industrial waste management companies that
we have consigned to dispose of our industrial waste. Additionally, once a

80

KDDI Sustainability Report 2020

Initiatives to Improve Employees’
Procurement Skills
TargetEmployees
responsible for
procurement

KDDI

Activity

Initiative details• Training program for newly appointed personnel• Compliance training• Recommendation to pass the grade B exam for Certified
Procurement Professionals

Initiatives for au Shops

KDDI

ActivityAt the end of March 2020, there are 18 KDDI directly managed outlets
dedicated to KDDI products and services and 2,174 au Shops throughout
Japan. These shops including au Shops are the place where customers
actually see and experience au products and services. KDDI products andservices are also widely available at Toyota car dealers and electronics
retail stores in addition to au Shops.
We at KDDI consider that improving the service quality of au Shops—
as specialty stores for a telecommunications operator—and other au
distributors to be particularly important to maximizing positive customer
experiences. We continue to support them in various ways to further
improve skills of the staff.
Since training au Shop staff is essential to improving the service quality of all distributors, we encourage the staff to learn effectively throughgroup sales training and e-learning for basic operational knowledge andnew product information. We also implement a qualification system toevaluate staff skills and store management capabilities and encourage
their sales efforts to achieve higher customer satisfaction by awarding thetitles “au Advisor,” “au Master,” and “au Expert.” Additionally, each year invarious locations in Japan, KDDI holds the “au CX AWARD,” a customer
service competition that recognizes excellent customer service and shares
good practices of customer service.
Moreover, KDDI employees periodically conduct data security audits
at au Shops and provide feedback based on the audit results. In this way,
we are working to raise security awareness among staff handling personal
information and to improve the accuracy of operations.

Support for Distributors

KDDI

SystemWe at KDDI support our main distributors in their various businessactivities. This includes our support when they open au Shops or move to
new locations, in organizing staff, and in staff capacity building throughvarious in-store staff training and qualification exams.
In its agreement with distributors, KDDI requires them to have no
involvement in anti-social forces, engage in fair trade practices andconduct proper business activities.
▪ Major Education and Training Activities
TargetInitiative details

Frequency

For distributors’
management

Sales role-playing training session using
examples of inappropriate conducts(Expected good practices to be cascaded by
distributors’ management to their staff)

Once ayear

For in-store staff

E-learning “Compliance General Course”
Distribution of various training materials(examples of misconducts, etc.)

Once ayear

For in-store staff

Awareness raising through Compliance Video

Once ayear

year, we hold onsite checks of industrial waste companies that perform
mobile phone disassembly.
In fiscal 2019, we conducted inspections of a total of five companies.
We inform each company of the results as feedback. If correction isnecessary, we create an action plan and work on the improvement jointlywith the company.

KDDI Sustainability Report 202081

Top Message

Message from Executive Officer of Sustainability

Materiality 6KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Materiality 5

Management Framework

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental ManagementKDDI’s ApproachKDDI Group

Social Issue
In 2015, the world adopted the Paris Agreement, which calls for a
global effort to hold the increase in global temperature to well below
2°C above pre-industrial levels and to pursue efforts to limit it to 1.5°C.
As Recommendations of the Task Force on Climate-related Financial
Disclosures (TCFD) was published in 2017, companies, too, are required to be part of this effort by setting emissions targets and tackle
climate change through their businesses activities.

Management Framework
KDDI Environmental Charter
ManifestoKDDI Group recognizes the importance of fulfilling its duty as a responsible global corporate citizen to conserve and protect the Earth’s
irreplaceable environment so that it can be inherited by future generations. We are committed to pursuing our business in eco-conscious
ways, through programs of activities that span the entire company.
Action Guidelines

1. We will strive to evaluate the quantitative impact of our activities as acompany on the global environment, implement effective environmental
protection programs and continuously improve these programs. Specifically, we will:(1) Develop and operate environmental management systems necessary to make continuous improvements in such environmental
fields as energy conservation, resource conservation and waste
reduction.

Our Risks and Opportunities
There is an increasing trend in the ESG investment community, especially in the United States and Europe, to divest from companies thatare not environmentally responsible. KDDI, and the wider telecom industry, must also consider its impact on the environment when making
capital investments and developing services.
Each country and region has regulations and measures that influence corporate business activities, such as energy-saving standards,
carbon taxes, and emissions trading. We consider such regulations
and measures as potential risks to business continuity and growth.
In order to comply with these regulations, we are building environmentally responsible bases, as well as providing services that save energy and reduce society’s environmental impact through the use of
ICTs, creating an opportunity for our business growth.
(2) Comply with environmental laws, ordinances and other regulations and requirements.
In particular, we will promote measures to reduce our electricity
consumption from the perspective of preventing global warming.
(3) Promote communication through the appropriate disclosure of information.
2. We will strive to develop and offer services that reduce the environmental impact through the use of next-generation information technologies.
3. We will contribute to the development of a recycling-oriented society
by promoting measures to mitigate and reduce the environmental
impact of activities that necessarily entail mass consumption, suchas the supply of mobile handsets.
4. We will promote corporate purchasing policies that favor eco friendly
products and equipment.
5. As a responsible corporate citizen, we will contribute to society andlocal communities through activities that promote an affluent societythat is in harmony with the environment.

FY2020 Material KPIs

Web Link

KDDI Group

PolicyKDDI Group

PolicyFY2020 Material KPIs

Moving Forward

KDDI Group

Energy efficiency improvement and utilization of clean energy
Zero emissions and 3Rs
Reduction of society’s impact on environment through ICTs

82

PolicyKDDI Sustainability Report 2020

PolicyInitiatives

KDDI’s Approach (Environment)

KDDI Group

PolicyKDDI Group

PolicyOur attitude toward environmental conservation is defined in the KDDI Environmental Charter, which regulates the Manifesto (Approach to Global
Environmental Problems), which is its highest concept, and the Action
Guidelines for setting the direction of its concrete initiatives.

Web Link

KDDI Environmental Charter

Climate Risks and Opportunities
According to the Intergovernmental Panel on Climate Change (IPCC),
global warming is undoubtedly real. They consider that this to be most
likely caused by human activities such as economic growth and an increasing population. We see the climate risks as significant business challenges, while we believe our opportunities lie in cutting greenhouse gas
emissions to mitigate climate change and in reducing the adverse impactsof doing so.
Our Risks and Opportunities from Regulations
Some national and regional regulations and policies influence corporate
business activities, such as energy-saving standards, carbon taxes, andemissions trading. We consider such regulations and measures as potential risks to business continuity and growth. In order to comply with theseregulations, we are building environmentally responsible bases, as well as
providing services that save energy and reduce society’s environmental
impact through the use of ICTs, creating an opportunity for our businessgrowth.
Our Risks from Natural Disasters and Opportunities in Building Resilience
Global warming has caused extreme weather events such as larger typhoons and heavy rain, bringing damage worldwide. Natural disasters
also damage our telecommunications facilities, which would pose risks toour business continuity. On the other hand, there is a growing demand
globally for disaster risk reduction measures. We are working to expand
our business by offering anti-disaster measures that use ICTs such as
monitoring systems and disaster risk reduction (DRR) systems.

Our Other Risks and Opportunities
A lack of action against climate change can in itself be a business continuity risk of, for example, a decline in market competitiveness and in stakeholder trust. We have set long-term objectives to mitigate climate change,
and we believe that providing environmentally conscious services leads tobusiness expansion and can also help achieve SDG 7: Affordable andclean energy and SDG 13: Take urgent action to combat climate change
and its impacts.

Web Link

Message from Executive Officer of Sustainability

Scope of Reporting on Environment-Related Information

Web Link

Range of Environmental ISO Certification(KDDI Group ISO 14001 Certification Acquisition)

Web Link

Environmental Accounting Scope of Calculation(Scope of Environmental Accounting)

Web Link

Environmental Impact Scope of Calculation(Environmental Impact of FY2019 Business Activities)

KDDI Sustainable Action P.12 - 29
Environmental Management P.83 - 88
Environmental Performance P.89 - 97

KDDI Sustainability Report 202083

Top Message

Message from Executive Officer of Sustainability

Materiality 6KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Management

The Fourth Environmental Conservation Plan: KDDI GREEN PLAN 2017-2030
We are promoting a new Environmental Conservation Plan: KDDI GREEN
PLAN 2017-2030. This long-term plan is based on the objectives of theParis Agreement adopted at COP21 in 2015 and Japan’s Plan for Global
Warming Countermeasures. Our plan targets a 7% reduction in CO2 emissions from the fiscal 2013 level by fiscal 2030. In order to achieve this, we
continue our efforts to reduce CO2 emissions by implementing renewable

KDDI

Policyenergy and other measures.
We will disclose our progress each year as well as improve and revise theplan when we need to.

Web Link

KDDI GREEN PLAN 2017-2030 FY2019 Results

Climate Action- 7% reduction in CO2 in FY2030 compared to FY2013 for KDDI (in Japan, non-consolidated)*1

Environmental Management

KDDI Group System- Contributions to reductions in society’s CO2 emissions by providing KDDI’s informationand communication technology (ICT) services*1 KDDI’s target emission reduction of 7% compared to FY2013 matches the 7% industry target in Japan’s national Climate Action Plan.
In order to achieve this target, KDDI will make use of various approaches to reduce emissions, including the use of renewable energy.

Creating a Recycling-Oriented Society- Maintain zero emissions from retired telecommunication facilities*2

Management Structure
In order to clearly state our approach to integrating the sustainability of theenvironment into our business operation, KDDI Group conducts the Sustainability Committee for discussing material environmental issues. The results of such discussion are shared at the Environmental Subcommittee,
which is headed by the President as the Chairperson and organized by
the Sustainability Department as the secretariat, with the managers ofeach division and Group company that has acquired ISO 14001 certification to be reflected in their objectives. The Green Plan Subcommittee,
which was established in fiscal 2017, monitors and drives progress on thetargets in the KDDI GREEN PLAN 2017-2030.

We at KDDI Group conduct internal environmental audits as required by
ISO 14001. Auditors are selected from each regional office by the Sustainability Department to ensure objectivity and independence.
In fiscal 2019, 15 divisions and 28 offices in KDDI and group companies were audited. Referring to the internal environmental audit results offiscal 2018, emphasis was placed on (1) reflecting each corporate issue toits environmental targets, (2) compliance with environmental laws and regulations, and (3) EMS operation. Self-checks using a check sheet wereconducted along with audit interviews by auditors. There were nonon-conformances, and 104 items requiring improvement or receiving
proposals.

Environmental Management System
KDDI Group has formed the Environmental Management System (EMS)
with the Environmental Subcommittee at the center. This subcommittee
manages the status of EMS operations carried out by each division, regional office, Group company, and related organization and leads cooperation at each Group company to promote efficient environmental conservation activities.

KDDI Group ISO 14001 Certification Acquisition(certified by Japan Quality Assurance Organization, JQA)

- Maintain material recycling rate of 99.8% for used mobile phones*2 Z ero emissions are defined as a final disposal rate of 1% or less.
Conservation of
Biodiversity▪ KDDI Group’s Environmental Management Structure

Conservation of Biodiversity

President- Actively promote initiatives using ICTs to conserve ecosystems

Corporate Management
Committee
Sustainability Committee

Net-zero CO2 Emissions by 2050
KDDI will proactively drive a shift to renewable energy to substantiallyachieve net-zero CO2 emissions by 2050 and reduce the environmental
burden on society through the use of ICT.

Web Link

KDDI Sustainable Action

KDDI Group System- Upgrading to highly energy-efficient data centers in Japan and abroad

Climate Action

Creating a
Recycling-Oriented
Society

Internal Environmental Audits

KDDI

PolicyGreen Plan
Subcommittee

Environmental
Subcommittee

Human Rights
Subcommittee

As of the end of March 2020:

KDDI Corporation, Okinawa Cellular Telephone Company,
KDDI Research, Inc., KDDI Technology Corporation,
KDDI Engineering Corporation,
Japan Telecommunication Engineering Service Co., Ltd.,KDDI Foundation, Telehouse International Corporation of Europe Ltd. (U.K.),
Chubu Telecommunications Co., Inc.,
KDDI MATOMETE OFFICE CORPORATION, KDDI MATOMETE OFFICEHIGASHINIHON CORPORATION,
KDDI MATOMETE OFFICE CHUBU CORPORATION, KDDI MATOMETEOFFICE KANSAI CORPORATION,
KDDI MATOMETE OFFICE NISHINIHON CORPORATION, Kokusai Cable
Ship Co., Ltd.,
15 companies /organizations in total are certified

Web Link

ISO 14001 Certification

Internal Auditors

Division Directors
Division Environmental
Managers

Within Divisions, Branches,
Regional Offices and Group Companies

Division Environmental
Management Committees

Environmental Managers

Employees

84KDDI Sustainability Report 2020

KDDI Sustainability Report 202085

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 6

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Management

Compliance with Environmental Laws
and Regulations

KDDI Group System<Related Laws and Regulations>• Act on the Rational Use of Energy• Act on the Promotion of Sorted Collection and Recycling of Containers
and Packaging• Waste Management and Public Cleansing Act• Act on Rational Use and Proper Management of Fluorocarbons• Law Concerning Special Measures for Promotion of Proper Treatment of
PCB Wastes (PCB Special Measures Law)
Appropriate Processing of PCB-containing Equipment
We are promoting the disposal of retired equipment that contains PCBs.
We are continuing to dispose of remaining equipment containing
high-concentration PCBs and low-concentration PCBs.

KDDI

Activity* A council aiming for establishing energy conservation indices and other standards to be referenced when procuring ICT devices and data centers

Education and AwarenessRaising for Employees

KDDI Group

Activity &Results

We believe that enhancing the environmental awareness of all employees
and encouraging them to better understand environmental issues are
essential to promote our environmental activities.

Briefing
session at the
beginning of
the term

TargetDetails / Results

Persons
responsible forenvironmental
ISO ofKDDI Group

Themes: KDDI’s EMS, environmental laws andregulations, details of new regulation
revisions.
P articipants: A ttended by 17 representatives
from 11 out of 11 departments(100% of target departments)
and 20 representatives from
11 out of 12 group companies(92% of target companies)

86

KDDI Green Procurement Guidelines (Japanese only)

Web Link

Supply Chain Management

Response to Law on Promoting Green Purchasing
KDDI has a lineup of products that meet the requirements of the Japanese
government’s Law on Promoting Green Purchasing.

Web Link

State of Compliance with Green Purchasing Law (Japanese only)

Web Link

List of Compatible Models with Green Purchasing Law (Japanese only)

Web Link

Product Line-Up

Cooperation with Business Partners

KDDI

SystemWe continuously make our base stations lighter in weight and more energy efficient. As 5G networks process larger volume of data (traffic) than 4G
networks, electricity consumption would significantly increase with the existing system. Therefore, we work with the suppliers of equipment for basestations to develop equipment lighter in weight and more energy efficient.
We are introducing the most advanced 4G and 5G base stations, reducing weight by approximately 40% and electricity consumption by approximately 19%, compared to conventional 3G and 4G base stations.
We will continue to promote approaches to business partners andwork with suppliers to reduce our environmental impacts.

2

3

Held study sessions to train 2 auditors

Has a voluntary ecological action plan stipulating various efforts directed at reducing CO2 emissions throughenergy conservation been created and is it being executed?

We have formulated and are implementing medium-term environmental conservation plans based on theKDDI Environmental Charter

Does the ecological policy include specific efforts stipulating numerical targets for the reduction of CO2 emissions through energy conservation?

The fourth environmental conservation plan (KDDI GREEN PLAN 2017-2030) included the following targets• 7% reduction in CO2 in FY2030 compared to FY2013 for KDDI (in Japan, non-consolidated)• Upgrading to highly energy-efficient data centers in Japan and abroad• Contribute to reductions in society’s CO2 emissions by providing KDDI’s ICT services• Maintain zero emissions from retired telecommunication facilities
Achieve final disposal rate of 1% or less (Zero emissions is defined as having a final disposal rate of 1%or less)• Maintain material recycling rate of 99.8% for post-consumer mobile phones• Actively promote initiatives that use ICTs to conserve ecosystems

Web Link

KDDI Environmental Charter

The Fourth Environmental Conservation Plan: KDDI GREEN PLAN 2017-2030

Is the ecological policy documented and disseminatedinside and out-side of the company? Does the company carry out activities to inform and enlighten its
employees? Is the company working to raise ecologicalawareness?

• The environmental conservation plan is disclosed within and outside the company in the Sustainability
Report and on the corporate website• We also provide e-learning program and internal seminars for employees as needed

4

Does the company disclose to the general public its
activities and data such as CO2 emission reduction?

The progress toward the achievement of the trend targets for the medium-term environmental conservation plan is disclosed in the Sustainability Report and on the corporate website

5

In regard to ICT equipment and data center services,
has the company prepared a procurement standard
based on assessment standards specified in thisGuideline? Is procurement carried out in accordancewith the standard?

We conduct procurement activities in accordance with the KDDI Green Procurement Guidelines

Is the company cognizant of energy conservation in
procuring office equipment, supplies and logistics (e.g.,green purchasing)?

KDDI promotes green purchasing under the KDDI Sustainable Procurement Policy

7

In relation to efforts to reduce CO2 emissions throughenergy conservation, has the company assigned a person or department to be responsible for such matters?

The Sustainability Department was established8

Is there a regime in place using internal audits or othermeans to keep appropriate track of the implementationof measures and achievement of targets set forth in thevoluntary ecological action plan?

We monitor the implementation and the achievement level, conduct inspections and improve throughinternal audits under the Environmental ISO Management System

9

Are ecologically friendly efforts being made other thanactivities to save energy?

We consider the promotion of 3Rs (Reduce, Reuse, Recycle) to also be a significant issue and are committed to the following initiatives:• Promotion of recycling communication facilities and achieving higher recycling rate
• Promotion of recycling post-consumer mobile phones and achieving higher recycling rate
• Reduction in paper resource use via Green by ICTs (Bill on Web, KDDI paperless fax service, slimmed
down au mobile phone manual, compact individual packaging, etc.)• Reduction in office waste and achieving higher recycling rate.
We are also engaged in improving the supply chain by dealing with Scope 3 and promoting LCA andin conserving biodiversity.

6

Is the company involved in ecological preservation
activities in collaboration with local communities?

Web Link

Web Link

Web Link

Education and Awareness Raising for Employees

Promoting Green Procurement

Supply Chain Management

Web Link

Environmental Performance (Low-Carbon Society)

Web Link

Environmental Performance (Recycling-Oriented Society)

Web Link

Environmental Performance (Biodiversity)

We implement environmental conservation activities across Japan, together with our employees andlocal stakeholders such as local authorities and NPOs

Web Link
All Employeesof KDDI Group

Results

Implementation, measures taken

Web Link

10

Training ofinternal
Environmental
auditorse-learning

Web Link

1

KDDI

Assessment items

Other ecological activities

Initiatives

We formulated the KDDI Green Procurement Guidelines to promote purchasing of more environmentally conscious products and business equipment (communication devices, air conditioning systems and power supply
facilities) with high energy-saving performance. The Guidelines target thedevices defined in the latest Ecology Guideline for the ICT Industry specified by the ICT Ecology Guideline Council.
We also confirm our business partners’ response toward environmental management, using the Responsible Procurement Surveys.

Self-Assessment Checklist for CO2 Emission Reduction from Energy Conservation Efforts
by Telecommunications Services Provider

Promotion regime

KDDI has acquired the Eco ICT Logo established by the ICT Ecology
Guideline Council * to work toward improving environmental consciousness and reducing environmental impacts.

PolicyEfforts relating to
Procurement

Acquiring the Eco ICT Mark

KDDI

Preparation of a voluntary ecological action plan

Compliance with Various Environmental Management Laws and Regulations
In order to prevent or reduce environmental impacts by our business activities, we strictly comply with national environmental laws and regulations, as well as with local ordinances and agreements. In KDDI, there
were no violations of environmental laws and regulations in fiscal 2019.
There were no environmental contaminations, such as leakage or outflow
of hazardous substances either.

Promoting Green Procurement

Environmental Conservation Activities by Employees

Theme: KDDI’s initiatives for environment(Trainees: 11,164 (84.3% of the targets))

KDDI Sustainability Report 2020

KDDI Sustainability Report 202087

Top Message

Message from Executive Officer of Sustainability

Materiality 6KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Performance

Environmental Management

Environmental Accounting

KDDI GroupWe have implemented environmental accounting since 2010 as an effective measure to quantitatively evaluate the costs and results of our environmental activities.
We analyze calculated costs and results to conduct more efficient environmental management.

Policy<FY2019 Scope of Environmental Accounting>

Period: April 1, 2019 to March 31, 2020
Scope of calculation: KDDI and 28 major group companies *Calculation standard: Environmental Accounting Guidelines 2005 formulated by the Japan’s Ministry of Environment,KDDI Environmental Accounting Guidelines
Unit: million yen

Environmental protection costs

FY2018Transaction examples

Investment

Change fromprevious year

FY2019Cost

Investment

Cost

Investment

Pollution prevention costs stipulated by laws, costs for proper disposal of
PCB, etc.

0

27

0

1

0

(26)

Global environmental
protection costs

Power-saving wireless equipment for mobile base stations (Investment
amount is calculated proportionally based on the power-saving effect)220

18,87898

10,034(122)(8,844)

Resource recycling
costs

Reduction of paper consumption, processing and disposal of waste products

0

711

0

121

0

(590)

Upstream/downstream costs

Collection, recycling and reuse of merchandise and products

0

991

0

1,277

0

286

Management costs

Operation and updating of environmental ISO standards, disclosure of environmental information

0

137

0

114

0

(22)

R&D costs

R&D of technology, equipment, handsets, products and services conducive
to reducing the environmental impacts

0

47

0

0

0

(47)

Social activity costs

Donations and support for forest conservation activities and to environmental conservation groups

0

50

0

37

0

(14)

Environmental damage restoration costs

Asbestos survey

0

0

0

0

0

0

220

20,841

98

11,585(122)(9,256)* mediba Inc., KDDI Research, Inc., KDDI Technology Corporation, KDDI Engineering Corporation, KDDI Evolva Okinawa Inc., KDDI Challenged Corporation, KDDI MATOMETE OFFICE CORPORATION, KDDI
MATOMETE OFFICE HIGASHINIHON CORPORATION, KDDI MATOMETE OFFICE CHUBU CORPORATION, KDDI MATOMETE OFFICE KANSAI CORPORATION, KDDI MATOMETE OFFICE NISHINIHONCORPORATION, OKINAWA CELLULAR TELEPHONE COMPANY, Okinawa Telecommunication Network Co.,Inc., Japan Telecommunication Engineering Service Co., Ltd., Chubu Telecommunications Co.,
Inc., Kokusai Cable Ship Co., Ltd., UQ Communications Inc., BIGLOBE Inc., TELEHOUSE International Corp. of Europe Ltd. (UK), TELEHOUSE International Corp. of Europe Ltd. (France), TELEHOUSE International Corp. of America (US), TELEHOUSE Deutschland GmbH (Frankfurt), HKCOLO. NET Ltd. (Hong Kong), TELEHOUSE Beijing BEZ Co., Ltd. (Beijing), TELEHOUSE Beijing BDA Co., Ltd. (Beijing), TELEHOUSE Shanghai Co., Ltd. (Shanghai), KDDI Singapore Pte Ltd. (Singapore), TELEHOUSE International Corp. of Vietnam (Hanoi)(1) Benefits for business
operation area(2) B enefits for upstream /downstream costs

Indicator category1) B enefits related to resources input inbusiness activities▪ Environmental Impact of FY2019 Business Activities (Coverage: KDDI, non-consolidated basis)• Resource• Energy

Input• Power consumption
2,258,518 MWh
For telecommunications facilities
2,239,876 MWh
Offices
18,643 MWh• Paper usage• Water usage

FY20193,157,389

3,084,018(73,371)(1,410)Electricity usage

Unit: MWh

Paper usage

Unit: ton

11,012

9,602

Paper reduced by Bill on Web
Greenhouse gas emissions*

Unit: ton

4,040.6

4,207.3

166.7

1,557,489.1

1,376,495.6(180,993.5)

3,103

3,749

646

288

279

(9)

Unit: t-CO22) Benefits related to waste or environmental impact originating from businessactivities

Industrial waste emissions related totelecommunications facilities and buildings

Unit: ton

Benefits related to goods and services
produced from business activities

Number of post-consumer mobile phones
and other devices collected

Unit:
10,000 units

Unit: million yen

Revenues
Cost reductions

Substantial benefits (Major effects)

FY2018
134.6

140.3

5.7

Reduction in energy costs by introducing low-pollution vehicles

36.6

35.5

(1.1)

2,929.5

4,850.6

1,921.2

3,100.6

5,026.4

1,925.8

Reduction in costs of new purchases by reusing old telecommunications facilities

Total

Consolidated electricity consumption
derived from renewable energy sources

Unit: MWh

Consolidated water resource input(total volume)

Unit: 1,000 m3

Consolidated water resource input(basic unit)

88

KDDI Sustainability Report 2020

FY2019Change fromprevious year

Revenues gained by disposal of telecommunications facilities and buildings

FY2019: Consolidated data
(Data not covered by the environmental accounting above)

KDDI Targets for FY2030: Consolidated data
169,349

Consolidated electricity consumption
Consolidated electricity consumption derived from renewable energy sources

Unit: 1,000 m3 / person

675
0.016

531 kℓ ※1
235 kℓ59 kℓ
237 kℓ

3,513,024
Unit: MWh

Consolidated electricity consumption from the power grid
Consolidated water resource input (basic unit)

255,772• Power

9,512 t395,000 m 3 *2

Use

Sale

Manufacturers

Telecommunications
facilities

OfficesCustomer

Emissions• Industrial waste *3• Amount of landfill waste
Emissions

1,937 t0.4 t

• Scope 1 Greenhouse gas emissions (CO2 equivalent) *4
Fuel for telecommunications facilities
6,685 t• Industrial waste

Emissions• Scope 2 Greenhouse gas emissions (CO2 equivalent) *5
Power for telecommunications facilities
1,243,131 t
Power consumed at offices
10,347 t• Scope 3 Greenhouse gas emissions (CO2 equivalent) *6
Supply chain emissions
5,410,384 t* The CO2 emissions are calculated using the emission factors furnished by electric utility operators. (Emissions from heat, steam and hot and chilled water consumption are included.)

2. Economic benefits of environmental
conservation measures (yen)• Fuel consumption
Heavy oil (crude oil)Light oil (diesel)
Kerosene

Input

Change fromprevious year

FY2018

Activity &Results

day business activities in the offices.
We calculated greenhouse gas emissions in three areas, Scopes 1, 2
and 3 (all categories), and received third-party verification.

DeliveryTotal

1. Environmental conservation benefits (physical)

KDDI

Most of our input energy is electric power for telecommunications facilities.
Heavy oil (crude oil), light oil (diesel) and kerosene are input when testing
emergency power generation facilities. Most water usage occurs in every-

Cost

Pollution prevention
costs

Business
operation area
costs

Environmental Impact of Business Activities• Number of collected mobile phones

Recycling
resources

Recycling

Main bodies
Batteries
Chargers

1,180,000 units
980,000 units
630,000 units

Used mobile phones*1 Used for air conditioning of telecommunications facilities and for emergency generators.
*2 Water supply, recycled water, well water, excluding waste water*3 Nonhazardous industrial waste (telecommunications equipment, normal daily waste from KDDI buildings)*4 Heavy oil (crude oil), Light oil (diesel), kerosene, town gas*5 CO2 emissions are calculated using a conversion coefficient of 0.555kg-CO2/KWh for the power consumption. (Emissions from heat, steam and hot and chilled water consumption are excluded.) Using theemission factors furnished by electric utility operators, CO2 emissions from KDDI non-consolidated basis (Scope 1 + Scope 2) in FY2019 is 1,046,820 t.
*6 CO2 emissions are calculated using emission coefficients indicated in the Japan’s Ministry of the Environment’s Overview of Basic Guidelines on Accounting for Greenhouse Gas Emissions throughout theSupply Chain.

255,772
Unit: 1,000 m3 /person0.014
KDDI Sustainability Report 202089

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 6

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality

Materiality 4

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Performance

Understanding Environmental Impact

KDDI

In order to quantitatively understand and share information about our environmental impact, we have calculated our supply chain greenhouse gas
emissions (Scopes 1, 2 and 3) in adherence with various guidelines* since
fiscal 2012.
In our fiscal 2019 business activities, Scope 3 accounted for 81% of
total greenhouse gas emissions (Scopes 1, 2, and 3). When viewed bycategory, Categories 1 and 2 have continued to make up large portions
as in the previous fiscal year.
Additionally, in order to ensure the reliability of calculations, the resultsof Scopes 1 and 2 were subjected to independent third party verification
by Lloyd’s Register Quality Assurance Limited, while the results of Scope
3 received third party verification from Waseda University.

Activity &Results▪ GHG Emissions and the Proportion of Each Category (Coverage: KDDI, non-consolidated basis)

Category

FY2015FY2016FY2017FY2018FY2019CO2 emissions

CO2 emissions

CO2 emissions

CO2 emissions

CO2 emissionst
Scope 1*1

All direct GHG emissions

Scope 2*2

* Green Value Chain Platform▪ Comparison of GHG Emissions Ratio of Each Category (FY2019)

%

t

%

t

%

t

%

t

%

5,344

0.10

5,365

0.09

5,834

0.09

6,695

0.12

6,685

0.10

Indirect GHG emissions from consumption ofpurchased electricity, heat or steam

1,076,209

19.54

1,062,130

18.42

1,158,078

18.81

1,194,058

20.91

1,253,478

18.79

Category 1

Purchased goods and services

3,236,999

58.78

3,507,745

60.85

3,818,806

62.02

3,347,946

58.62

3,529,472

52.91

Category 2

Capital goods

776,71114.10

815,893

14.15

828,675

13.46

875,318

15.33

1,584,908

23.76

Category 3

Fuel- and energy-related activities
not included in Scope 1 and 2

35,3790.64

34,9130.61

35,2800.57

37,1040.65

40,1880.60

Category 4

Upstream transportation and distribution

7,370

0.13

8,706

0.15

12,101

0.20

8,777

0.15

7,408

0.11

Category 5

Waste generated in operations

681

0.01

583

0.01

1,043

0.02

710

0.01

413

0.01

Category 6

Business travel

4,831

0.09

5,314

0.09

6,327

0.10

5,012

0.09

4,955

0.07

Category 7

Employee commuting

4,574

0.08

4,642

0.08

4,332

0.07

4,034

0.07

5,043

0.08

Category 8

Upstream leased assets

1,309

0.02

1,209

0.02

1,092

0.02

1,133

0.02

784

0.01

Category 9

Downstream transportation and distribution

0

0.00

0

0.00

0

0.00

0

0.00

0

0.00

Category 10

Processing of sold products

0

0.00

0

0.00

0

0.00

0

0.00

0

0.00

Category 11

Use of sold products

356,359

6.47

318,0235.52

285,294

4.63

229,913

4.03

237,008

3.55

Category 12

End-of-life treatment of sold products

886

0.02

363

0.01

426

0.01

344

0.01

205

0.00

Category 13

Downstream leased assets

0

0.00

0

0.00

0

0.00

0

0.00

0

0.00

Category 14

Franchises

0

0.00

0

0.00

0

0.00

0

0.00

0

0.00

Category 15

Investment

0

0.00

0

0.00

0

0.00

0

0.00

0

0.00

4,425,098

80.36

4,697,389

81.48

4,993,377

81.10

4,510,291

78.97

5,410,384

81.11

5,506,651

100.005,764,884

100.006,157,289

100.005,711,044

100.006,670,547

100.00Category 7 0.08%
Category 6 0.07%
Category 5 0.01%

Category 8 0.01%
Category 11 3.55%

Category 4 0.11%

Scope 1 0.10%

Category 3 0.60%

Scope 2 18.79%

Category 2 23.76%

Category 1
52.91%
Scope 381.11%

Scope 3*3

Total

*1 Heavy oil (crude oil), diesel, kerosene, town gas*2 Emissions from power consumption: conversion coefficient of 0.555kg-CO2/KWh (Emissions from heat, steam and hot and chilled water consumption are excluded.)*3 Uses emission coefficients indicated in Japan’s Ministry of the Environment’s Overview of Basic Guidelines on Accounting for Greenhouse Gas Emissions throughout the Supply Chain.

90

KDDI Sustainability Report 2020

KDDI Sustainability Report 202091

Top Message

KDDI’s Material Sustainability Issues

Message from Executive Officer of Sustainability

Materiality 6

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Performance

Environmental Impact Data

Activity &Results

KDDI

KDDI

FY2015FY2016FY2017FY2018FY2019CO2 equivalent-unit: ton

5,506,651

5,764,884

6,157,289

5,711,044

6,670,547

Power consumption

Unit: MWh

1,939,115

1,913,747

2,086,626

2,151,456

2,258,518

Electric power consumption per subscriber *2

Unit: MWh

390.4

363.5

368.3

360.6

357.3

Fuel consumption *3

Unit: kiloliter

258

341

319

330

531

Paper usage

Unit: ton

11,853.0

9,691.1

7,461.6

10,852.9

9,511.8

Water usage *4

Unit: 1,000 m3

Industrial waste *5

Unit: ton

Greenhouse gas emissions*1

Number of mobile phones andother devices collected by KDDI

Mobile phone
main bodyBatteries

Unit: 10,000 devices

Chargers
Energy usage at equipment-related facilities

Unit: MWh

2,159

1,500

746

400

395

1,399.0

1,928.0

2,466.9

1,927.3

1,937.1

141

148

134

125

118

143

146

123

108

98

65

66

57

54

63

779,504

777,273

816,904

863,416

903,111*1 Scope 1, 2 and 3 emissions (Emissions from heat, vapor and hot and chilled water consumption are excluded from Scope 2.): CO2 emissions are calculated using a conversion coefficient of 0.555kg-CO2/KWh for the
power consumption, and those for the fuel consumption is calculated using the emission coefficient applied to reporting and disclosure system specified in the Act on Promotion of Global Warming Countermeasures.
*2 T
 he number of subscribers combines subscriptions for au and FTTH (unit: 10,000 contracts).
*3 Fuel consumption includes heavy oil, diesel and kerosene (but excludes city gas)
*4 Water supply, recycled water, well water, excluding waste water*5 Nonhazardous industrial waste (telecommunications equipment, normal daily waste from KDDI buildings)

Implementation of Life Cycle Assessments (LCA)

KDDI

Environmental Impact of “au”

Environmental Impact of “au Hikari”

Annual CO2 emissions per user (kg)Annual CO2 emissions per user (kg)

160

68.8
42.1

140

■ Manufacture■ Operation■ Recycling

100
80
40

30.1

20

-0.1

-0.1

-20

FY2015FY2018

KDDI Sustainability Report 2020

116.2
78.7

59.3

■ Manufacture■ Operation

60

26.8

Greenhouse gas emissions, which are considered a cause of global
warming, are increasing year by year, and reducing them is now a social
issue shared by all humankind.
The utilization of ICTs enhances the efficiency of business activities,
including production and consumption, and is expected to contribute to
the reduction of customers’ CO2 emissions. As ICTs expand, however, we
may face a greater environmental impact from data centers and base stations, which in turn will generate demand for the development and implementation of energy-saving facilities and equipment.
We at KDDI offer new ICT services to contribute to the reduction of
CO2 emissions to realize a low-carbon society.

Green Supported by ICTs

60.8

-2.9

-3.9

FY2015FY2018CO2 emissions per “au Hikari” user decreased 17.3% from the previous
assessment. CO2 emissions have declined as computers and other devices connected to the internet have come down in price, become more energy efficient and last longer before needing to be replaced. Another factor
behind the decline is that since 2016 network equipment has been getting
upgraded and stations have been consolidated.

KDDI

Activity

The Environmental Eco Label is granted to services that contribute to reducing the environmental impact of customers and society (reducing CO2
emissions) through the use of ICT services offered by KDDI.

Environmental Eco
Label services

Content

KDDI Cloud Platform
Service

KDDI operates and maintains this platform, enablingcustomers to increase or decrease their server capacity
remotely from their own offices, without having to travelto the data center where the servers are located.
Furthermore, customers can reduce the amount of CO2
emissions they are responsible for by transferring theservers that they install, operate and maintain themselves (on-premises environment) to the KDDI Cloud
Platform Service.
With this service, server operations are performed withan economy of scale unique to a telecommunications
operator, enabling an approximately 38% reduction in
CO2 emissions per server per year in comparison towhen customers operate their servers themselves

TELEHOUSE Data
Center Services

These data centers have high power supply capacity,
highly efficient and reliable power generation equipment,
energy-efficient air conditioning equipment, LED lighting,outdoor lights that use wind and solar power and otheradvanced, energy-efficient equipment.

MATOMETE
KURUMATICS

A next-generation vehicle operation management service that combines telecommunications with cloud technologies, enabling the real-time checking of driving
conditions

KDDI IoT Cloud—Toilet Water-Saving
Management■ Recycling

64.6

0

CO2 emissions per “au” user increased 11.1% from the previous assessment. CO2 emissions for handsets have risen as smartphones become
more ubiquitous, risen in price and gained battery capacity. Another contributing factor is the increase in wireless base stations to handle the expansion in communications traffic and greater number of frequencies
used. On the other hand, energy conservation is making progress as individual wireless base stations’ annual power consumption has fallen
24.5%.
92

140.4

120

46.5

Policyfew years. We conducted LCAs in fiscal 2018.
* The environmental impact from disposal and recycling are included in environmental impact frommanufacture.

76.4

KDDI Group

Activity &Results

We are working on LCAs that assess environmental impact by calculating
CO2 emitted through all processes related to products and services, including manufacture, use, disposal and recycling.* Since fiscal 2008, we
have regularly conducted LCAs for the “au” and “au Hikari” brands every

90
80
70
60
50
40
30
20
10
0
-10

KDDI’s Approach (Low-Carbon Society)

Monitors water level in each restroom utilizing IoTs toreduce water use by 40 to 50%*

* Expected values based on the actual values measured by thebulb manufacturer

KDDI IoT
Communication Service
LPWA

This telecommunications service uses LPWA technology,
which utilizes KDDI’s 4G LTE network. This technology
reduces the power consumed by telecommunication
devices and provides telecommunications coverage overa wider area.

au Denki RE100 Menu
and Non-Carbon Menu

Under the RE100 Menu, we supply electricity that meets
RE100 criteria by supplying electricity derived fromrenewable energy sources (including electricity underFeed-in Tariff scheme) and offsetting carbon through thepurchase of J-Credit (derived from renewable energy).
Under the Non-Carbon Menu, we supply electricity withzero CO2 emissions derived from the electricity purchase by utilizing J-credit scheme.

KDDI Sustainability Report 202093Top Message

Message from Executive Officer of Sustainability

Materiality 6KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Feature Article: KDDI Sustainable Action

Materiality 2

Materiality 3

Materiality

Materiality 4

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Performance

Green of ICTs

KDDI

Reducing Power Consumption and Undertaking Disaster Measure
Initiatives at Base Stations
Electricity consumed at the au mobile phone base stations accounts for
60% of the total volume consumed by KDDI, so reducing electricity consumption at base stations is one of our topmost priorities to tackle.
Also, 77% of the base stations that ceased to operate in the aftermathof 2011 Tohoku earthquake and tsunami did so because of power outages, which turned out to be a pressing issue to be addressed in disaster
preparedness measures.
In regard to these issues, we promote implementing tribrid base stations* and extending the life of base station batteries to 24 hours.
* Base stations that utilize tribrid electric power control technology to efficiently supply three kindsof electric power depending on time and weather: ordinary commercial power, power generated
by solar panels and “midnight” (off-peak) power saved in storage batteries.

Numbers as of the end of March 2020
Tribrid base stations

100 stations in Japan

Implementation of 24 hour-lifebase station batteries

Around 2,200 stations in Japan

Portable Batteries
Since fiscal 2013, we have implemented portable batteries with reduced
environmental impact at 12 maintenance bases throughout Japan as a
substitute for the power supply vehicles used in the past to power mobile
phone base stations during electricity outages.
▪ Portable Battery Trial Test Results*

Renewable Energy (Internal use)
In order to promote energy conservation and CO2 emissions reduction,
we use natural energy sources, including solar power, at several large
scale communication stations and tribrid base stations. At 11 of our mobile phone base stations in Japan, almost all electric power comes fromnatural energy sources.
The amount of natural energy produced by each tribrid base station isapproximately 4.2 kWh per day*, accounting for about 18% of the power
consumed at each base. We expect further reduction* of CO2 emissions
by 20 to 30% with the use of midnight power.
* Estimated average energy production value by six solar batteries installed in test stations during
clear skies. Includes actual values measured by KDDI.

Renewable Energy (Solar power generation business)
We launched solar power generation business in November 2013 withthe aim of contributing to reduction of CO2 emissions. We constructedsolar power generation facilities on part of company-owned land in seven
facilities of four locations around Japan and sell the power to electric power companies based on the Feed-in Tariff Scheme for Renewable Energy.
Unit: MWh

Total generated energy (sold)

8.2 ℓ of fuel consumed per time

CO2 emissions: 21.5 kg

Portable
Batteries

10 kWh of power consumed per time

CO2 emissions: 4.1 kg

FY2015FY2016FY2017FY2018FY201913,674

14,28818,137

17,99817,406KDDI’s Approach(Recycling-Oriented Society)KDDI

PolicyIn order to reduce our environmental impact from waste produced throughbusiness activities, we effectively utilize our resources to contribute to theformation of a recycling-oriented society.

Promoting Waste Reduction

KDDI

Results

We promote reuse activities that regenerate and effectively use retired
telecommunications facilities. We also conduct material recycling thatturns unneeded equipment and structural materials into resources. In fiscal 2019, we recycled deteriorated storage batteries installed in telephoneexchange stations used in test environments to utilize the materials andachieved a total recycling volume of 791.8 tons within KDDI. We will continue our commitment to reuse and recycle communication equipment, including base stations, retired due to regular upgrades.

Reducing Waste andPromoting Recycling

KDDI

Promotion of Mobile Phone Recycling

KDDI

Activity &Results

Used (post-consumer) mobile phones collected from customers at au
Shops are manually disassembled in secured rooms, with circuit boards,
displays, cameras, plastics, screws, iron, antennas, motors, speakers andother parts being separated. Gold, silver, copper and palladium are extracted from the circuit boards, while screws and antennas are recycled
into steel products, and plastics are recycled, to the extent possible, into
plastic products. When a machine is used to disassemble a mobile phone,plastics are burned up in the incineration process and so cannot be recycled. Recycling eliminates any need for new mining and refining of mineral
resources such as oil, iron, gold, silver and copper, while also reducing
the amount of carbon dioxide that is generated by materials processing.
Therefore, we at KDDI perform all disassembly manually to prevent recyclable resources from being wasted.
▪ Performance in FY2019
Collection performance*

Recycling rate (mobile phones)

2,790,000 units

99.8%

Activity &Results* Includes main body, batteries and chargers

Initiatives

FY2019 Results

Reduction of paper by putting bills on the Web

4,207t

Web Link

au Shop Locator▪ Basic Flow for Recycling of Mobile Phones

External Recognition

Power supply
vehiclesActivity

Web Link

KDDI

Customers

Results

Retail stores (au Shops, etc.)
Collections ofused mobile
phones

Personal information leakage prevention through formatting and circuitboard destruction
using specializedmachines

External Recognition
Turned into next products
and provided to customers

Iron products

Domestic steelmakers

Aluminumproducts

Copperproducts

Plastic products

Domestic producers of
non-ferrous metals

Recycling plantNon-ferrous metals (copper/aluminum)

To KDDI-designatedrecycling plant

FY2012 Results
A reduction of 17.4 kg of CO2 emissions each time
* With an approximately 10-hour base station power outage and 1 kW wireless device power consumption.

Plastic

Iron

Recycling plants (KDDI Challenged, etc.)
Disassembly conducted in secured rooms

Disassembly conducted byhand to facilitate material
recycling

Web Link
94

KDDI Sustainability Report 2020

Different recycling processes
employed for different
materials

Expanding Employment Opportunities and Advancement of Persons
with Disabilities
KDDI Sustainability Report 202095

Top Message

Message from Executive Officer of Sustainability

Materiality 6KDDI’s Material Sustainability Issues

FY2019 Material KPI Results

FY2020 Material KPIs

KDDI’s Commitment to Sustainability

Materiality 1

Materiality 2

Feature Article: KDDI Sustainable Action

Materiality 3

Materiality 4

Materiality

Management Framework

Materiality 5

Stakeholder Engagement

Materiality 6

An Energy-Efficient, Circular Economy• Energy efficiency improvement and utilization of clean energy• Zero emissions and 3Rs • Reduction of society’s impact on environment through ICTs

Environmental Performance

Approach to Water Use

KDDI

PolicyThere are fears of losing water resources because of increasing global
population and decreasing water availability due to climate change. As
disputes concerning water distribution and pollution have broken out invarious locations around the world, it is significant to make efficient use ofwater. We are making efforts to reduce water use in our business activities
as well as to offer products and services that contribute to efficient wateruse.
Providing KDDI IoT Cloud — Toilet Water-Saving Management

Web Link

Providing KDDI IoT Cloud — Toilet Vacancy Management and KDDI
IoT Cloud — Toilet Water-Saving Management (Japanese only)KDDI’s Approach (Biodiversity)

KDDI

PolicyWe have established the KDDI Action Guidelines on Biodiversity Conservation to multilaterally assess our contributions to the conservation of biodiversity. In the guidelines, we define the three principles of Conserving Diversity in Business Activities, Collaboration and Cooperation with Related
Organizations and Promoting Recycling of Resources. Based on this, we
continue our activities on various opportunities.
KDDI Action Guidelines on Biodiversity Conservation• Environment protection in Business Activities
When formulating business plans, we take into consideration theimpact on the related ecosystems and local communities.
• Collaboration and Cooperation with Related OrganizationsWe strengthen collaboration and cooperation with administrative
authorities, NPOs and other organizations, and undertake CSR activities using ICTs.
• Promotion of Resources Recycling To prevent the depletion of bio-resources and minimize the degradation of the natural environment, we continuously and proactively
engage in recycling of resources.

Web Link

Biological Research on
Endangered Ganges River Dolphins

KDDI Group Activity

KDDI Research, Inc. utilizes the acoustic technology gained through thedevelopment of underwater robots used to maintain and inspect submarine cables, which connect continents, to conduct biological observationsof endangered Ganges River dolphins, collaborating in this effort with the
University of Tokyo Institute of Industrial Science, the Kyushu Institute ofTechnology, the Indian Institute of Technology Delhi and WWF-India. The
research aims to catch the ultrasonic waves the dolphins emit to deter-mine their surrounding environment in murky waters with underwater
micro-phones to study the dolphins’ behavior underwater. An advantageof this method is that it enables the observations of large numbers of dolphins without having any impact on their behavior because it does not
physically touch the dolphins.

Green Activities with Customers and Employees
Environmental Conservation Activities by Employees
To promote the conservation of biodiversity in each region, we hold conservation activities that employees and their families participate in as volunteers. Working with stakeholders, including local authorities and NPOs,
the regional offices are actively engaged in local environmental conservation.

KDDI▪ Performance in FY2019
Environmental conservation activity
execution

Total participants

209

4,582

Hokkaido Branch• Hokkaido Coastal plant restoration to prevent damage to beaches from tsunamis• Hokkaido Participation in forest conservation activities at the foot of Mt. Tarumae

Head Office• Tokyo Promotion of forest conservation activities at Mt. Takao• Yamanashi Prefecture P articipation in Mt. Fuji Reforestation Project held
by OISCA

Hokuriku Branch• Toyama Prefecture P articipation in the Greenery and Satoyama
Conservation Forest Tree Raising Activities inTenbayashi-chiku, Tateyama-machi• Ishikawa Prefecture P romotion of afforestation activities on the siteof the former Osaki Beach Park

Chugoku Branch• Hiroshima Prefecture
Participation in forest conservation
activities held by the Hiroshima
Afforestation Forum• Yamaguchi Prefecture
Participation in “Release of
Sweetfish for Protection of
Beautiful Environment” in the Niho
River in Yamaguchi City

Tohoku Branch• Miyagi Prefecture
Forest improvement activities at KDDI’s Forest of Hope

Northern Kanto Branch• Saitama Prefecture
Participation in Conservation activities in MusenyamaKDDI's Forest, a Green Trust conservation location

Southern Kanto Branch• Kanagawa Prefecture
Participation in conservation and mountain reforestation
activities in the Kamakura Hiromachi urban forest

KDDI Action Guidelines on Biodiversity Conservation

Chubu Branch

Kyusyu Branch• Fukuoka Prefecture
Promotion of forest conservation activities to support
the Patchwork Reforestation, a project undertaken incollaboration with Sansonjuku

Shikoku Branch• Kagawa Prefecture
Participation in Onoseyama afforestation activities held by OISCA

96

Activity &Results

KDDI Sustainability Report 2020• Shizuoka Prefecture
Participation in cultivation and conservation activities ofpine trees in Miho no Matsubara

Kansai Branch• Kyoto Prefecture P romotion of forest conservation activities in Mt. Tennozan• Wakayama Prefecture P romotion of road repair activities for the world heritagesite Kumano Kodo pilgrimage routes• H yogo Prefecture P romotion of environmental conservation activities for stork
habitat in Toyooka City

KDDI Sustainability Report 202097Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Corporate GovernanceKDDI’s Approach and Guidelines on Corporate Governance
As a telecommunications company that offers social infrastructure, wehave an important social mission of seamlessly offering stable communication services at all times under any circumstance. We also recognize
our social responsibility to resolve various social issues through our telecommunications business, which relies on precious assets shared by all
citizens, including mobile phone signals and radio waves. In order to fulfill
this social mission and honor this responsibility, it is essential for us toachieve sustainable growth and improve our corporate value over the medium to long term. We aim to contribute to developing a safe and truly
connected society by tackling social issues through dialogues and co-creation with all our stakeholders, including customers, shareholders, business partners, employees and local communities. We believe reinforcing
corporate governance is key to our sustainable growth and increased corporate value over the medium to long term. We adhere to Japan’s Corporate Governance Code and strive to enhance a framework that enables▪ Corporate Governance Framework
General Meeting of Shareholders
Elect / Dismiss

Elect / Dismiss

14 Directors(including 5 Outside Directors)

AdviseConsult

Elect /
Dismiss/
Supervise

Judgment on
appropriateness of accounting audit

Audit

Audit & Supervisory Board
Member’s Office

Representative Director

ReportInstruct response

Audit

Corporate Risk Management DivisionInternal Control Division

Financialinformation

Business Divisions / Group Companies

Instruct response

ReportReportDeliberateissues* Excludes the 7 directors
who double as executive
officers

Instruct response(Business execution)

Instruct response

33 Executive Officers*

ReportInternal Audit Division

Instruct /Supervise

Disclosure Committee

Deliberate /Report on
Importantmatters

ReportInformation Security Committee

Full-time Directors

Sustainability Committee(Deliberate on important matters)

ReportReportReportReportCorporate Management
Committee

transparent, fair, timely and decisive decision making. Also, in addition to
our Mission Statement, we have formulated the KDDI Group Philosophy,
which defines the mindset, value and principles to be shared by officers
and employees and continue to raise awareness of this philosophy
throughout the group.
By proactively adhering to Japan’s Corporate Governance Code andpracticing the KDDI Group Philosophy, which we consider inseparablefrom the standpoint of corporate management, we will endeavor to enhance corporate governance throughout the KDDI Group, including its
subsidiaries, to achieve sustainable growth and increased corporate value
over the medium to long term.

Web Link

Corporate Governance Report

Corporate Governance Promotion FrameworkKDDI

We believe strengthening corporate governance to be one of the mostvital issues in enhancing corporate value, and we are working to improve
management efficiency and transparency.
KDDI is currently a company with board of company auditors, and inorder to properly manage business execution, we have introduced an executive officer system to assign authority, clarify responsibilities and ensure
effective and efficient business operations. We are also working to establish a framework for internal decision making to ensure timely management decisions. We have 14 directors (13 male, one female), including
five outside directors, three of whom are independent directors. There are
five Audit & Supervisory Board members (all male), including three outside
members, and all outside members are appointed as independent directors.
We also provide outside directors / auditors with a wide range of information outside the board meetings, including on business strategies,
management status, R&D and technology. Each division’s generalmanager and manager provide detailed explanations of the general
overview of business and issues and regularly report on the management
status of subsidiaries. In addition, we provide opportunities to visit inhouse exhibitions of R&D achievements as well as the telecommunications
equipment and monitoring center and other workplaces. We also provide

The Board of Directors is composed of directors, including independent
outside directors. They determine important legal matters and supervise
the business execution of directors to ensure the appropriateness.
▪ Board of Directors FY2019 Meetings
Number ofmeetings held

Internal directors'
attendance rate

Outside directors’
attendance rate

Outside auditors’
attendance rate

12

100%

100%

97.2%

Evaluation of the Board of Directors’ EffectivenessPurpose of Conducting

We conduct a self-evaluation of the Board of Directors regularly every year
in order to correctly understand its situation and continuously improve its
operation.

We assess the effectiveness of the Board of Directors based on an evaluation by the directors and Audit & Supervisory Board members themselves. The evaluation questionnaire combines a four-grade rating scale
and free writing so that the effectiveness of the board’s initiatives are assessed and matters to be improved are identified from two perspectives:
quantitative and qualitative.
The evaluation covers the most recent one year and is conductedannually. The results of the evaluation are reported back to the Board of
Directors to discuss future measures.
The main evaluation items are as follows:• Operation of the Board of Directors (composition of members, documents and explanations, provision of information, etc.)• Supervision of Executives (conflict of interest, risk management, management of subsidiaries, etc.)• Medium- to long-term discussions (review of medium-term businessplanning, monitoring of plan enforcement, etc.)

KDDI Sustainability Report 2020

Criteria for Independence of Outside Directors / Auditors
In addition to the requirements in the Companies Act and the standards
provided by the Tokyo Stock Exchange, Inc., we have formulated our own
standards for judging the independence of outside directors / auditors.
Specifically, we consider those belonging to business partners that account for 1% or more of the company’s consolidated net sales or orders
placed not independent.

KDDI

Evaluation Process

98

Systemtwo reports every year on corporate ethics and risk management activities. To enable more thorough information gathering capabilities while
maintaining the independence of Outside Directors, we hold regular liaison
meetings between Outside Directors and Audit & Supervisory Board
members, strengthening their cooperation. Accounting auditors also explain the results of audits to Outside Directors. To bolster information exchanges and sharing between Outside Directors, we hold liaison meetings
with only Outside Directors and liaison meetings with Outside Directors
and part-time Audit & Supervisory Board members. We aim to raise theeffectiveness of the Board of Directors supervision of management and toinvigorate discussions of management strategies at board meetings byproviding a deeper understanding of our business through these initiatives.

Directors and Board of Directors(including three Outside Members)
Audit

PolicyAccounting
Auditors

Report

5 Audit &Supervisory
Board Members

Business Ethics
Committee

Remuneration Advisory Committee
Nomination Advisory Committee
Elect / Dismiss

Deliberate /Report on
Importantmatters

Audit

Elect / Dismiss

ReportKDDI Group

System

Evaluation Results
SummaryKDDI’s Board of Directors has been rated as running appropriately andfunctioning effectively.
The following two points have received particular praise:• The agenda is well organized and focused on achieving sustainablegrowth and increasing corporate value over the medium to long term.
Deliberations are made based on active questioning from outside directors / auditors.
• Regular reports are made on the statuses of the medium-term management plan and the annual plan and meaningful discussions are constantly being held on how best to achieve the objectives.
Improvements from Previous Evaluation

During the previous evaluation, we identified the need to “hold discussions
from various perspectives related to the Company’s social mission and business strategies, such as the kind of company KDDI aims to be.” To this end,
we announced that in 2019, we would hold discussions on the medium- tolong-term management strategy and our corporate culture. We also stated in
our new medium-term management plan that we would strive to become acompany that can contribute to the sustainable growth of society by tacklingsocial issues through our business activities and as a company as a whole.
Moving Forward

While telecommunications remains our core business, the scale of our company continues to grow in multiple directions as we expand into other industries and fields. We determined that in doing so, it is particularly important tomonitor our subsidiaries to raise the overall corporate value of KDDI Group.
We will continue to discuss how to monitor subsidiaries as necessary andin an appropriate manner to further optimize supervision as a group.

Web Link

The 36th Annual General Meeting of Shareholders Notice

Web Link

Business Report Video (Initiatives of the 36th Year) (Japanese only)KDDI Sustainability Report 202099

Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Corporate Governance
Auditors and the Audit &Supervisory BoardKDDI

SystemThe KDDI Audit & Supervisory Board is composed of five members, including three independent outside members. It designs policies and execution plans for auditing as well as making decisions about important
items concerning auditing operations. In selecting outside auditors, we
see their abundance of experience along with a wide range of insight thattogether enable total management supervision and accurate auditing froma position independent of the directors.
Auditors attend meetings of the Board of Directors as well as otherimportant internal meetings, including meetings of the Corporate Management Committee. Directors, employees, directors of subsidiaries and theInternal Audit Division provide the auditors with the information they needto perform their duty as required in a timely manner and, if any matter potentially highly damaging to the company and / or its subsidiary is discovered, immediately notify the auditors. Furthermore, directors, employees,
directors of subsidiaries and the Internal Audit Division exchange theirviews with the auditors to facilitate coordination. The auditors also periodically receive reports from the accounting auditor on the annual accounting
audit plan, as well as on the progress and the results of the auditing andexchange opinions with each other as necessary. The Audit & Supervisory
Board Member’s Office has been established to assist the duties of Audit& Supervisory Board members, and dedicated staff appointed with theprior approval of the Audit & Supervisory Board or a full-time Audit & Supervisory Board member designated thereby receive instructions fromeach Audit & Supervisory Board member.
Audit & Supervisory Board FY2019
Meetings

Audit & Supervisory Board FY2020
Meetings (planned)

1211Internal Audits
We established the Audit Department in the Corporate Risk Management
Division, which is in charge of risk management of the KDDI Group. It conducts internal audits of overall KDDI Group operations on the importantrisks identified through risk management activities.The results of internal
audits are reported to the Company President and Audit & Supervisory
Board members together with requests and recommendations concerning
improvements and corrective measures to address highlighted issues, andthe status and results of internal audits are also reported to the Board of
Directors every quarter. In fiscal 2019, a total of 16 audits were carried out
to monitor the progress of corrective / improvement measures and to prevent risks from materializing.

Nomination Advisory Committee andRemuneration Advisory Committee

KDDI

SystemTo ensure the transparency and fairness of systems and standards fornomination of directors and Audit & Supervisory Board members and their
executive remuneration, we have established the Nomination Advisory
Committee and the Remuneration Advisory Committee, which deliberates
and provides advice to the Board of Directors based on discussions thereof. The chair, vice-chair and more than half of the members of these committees are outside directors.
Nomination Advisory Committee composition

Chair: Keiji Yamamoto (Outside Director)
Vice Chair: Goro Yamaguchi (Outside Director)
Members of Committee: Shigeo Ohyagi (Outside Director) Riyo Kano (Outside Director) 
Shigeki Goto (Outside Director) 
Takashi Tanaka 
Makoto Takahashi

Number of independent auditors

SystemCompany with board of company auditors
6 (including 1 female)

Items Related to Directors
Number of directors prescribed in the articles ofincorporation

20

Tenure period of directors prescribedin the articles of incorporation

1 yearPresiding officer of Board of Directors

Chair (president and Chairperson are separate posts)

Number of directors

14 (including 1 female)Outside directors

Appointed

Number of outside directors

5 (including 1 female)

Number of outside directors designated as
independent directors

3 (including 1 female)

Items Related to Audit & Supervisory Board Members

Chair: Goro Yamaguchi (Outside Director)
Vice Chair: Keiji Yamamoto (Outside Director)
Members of Committee: Shigeo Ohyagi (Outside Director) Riyo Kano (Outside Director) 
Shigeki Goto (Outside Director) 
Takashi Tanaka 
Makoto Takahashi

Number of members prescribed in the articles ofincorporation

5

Number of members

5 (all male)Outside members

Appointed

Number of outside members

3 (all male)

Number of outside members designated as
independent members

3 (all male)

Meetings held (FY2019)

Number of executives

33 (31 male, 2 female)

The Nomination Advisory Committee met twice, and all members attended each time. The committee discussed the nomination of candidates at
the General Meeting of Shareholders and the pros and cons of hiring a
Senior Corporate Advisor. The Remuneration Advisory Committee met
three times, and all members attended each meeting. The committee
discussed the following topics:• FY2018 payment of performance-linked remunerations• Appropriateness of the Company’s payment standard for board member remunerations• Overview of a stock price-linked bonus system

OthersOther Committees

Web Link

KDDI Sustainability Report 2020

Organizational formKDDI

Remuneration Advisory Committee composition

KDDI Group System

We have established the Business Ethics Committee, a deliberative anddecision-making body for compliance-related items, and the Disclosure
Committee, a deliberative body for releasing information. We also haveestablished the Sustainability Committee, which deliberates the promotionof sustainability. We collaborate with our group companies to manage
their governance through various systems and frameworks in order toenforce the governance of the whole KDDI Group.

100

Items Related to Organizational Structure
and Operations

Sustainability Promotion Framework

Implementation of anti-takeover measure

Not implemented

President and Representative Director remuneration / average KDDI employee annual salary

21 times

Policies Related to the Scale, Diversity,
Balance of Knowledge, Experience andAbilities of the Board of Directors

KDDI

Policies and Procedures when the Board of
Directors Appoints Candidates for Director or
Audit & Supervisory Board Member Positions

KDDI

Policy &SystemAppointment and Selection Standards

Director candidates: Meet one or more of the following criteria:•H ave specialized knowledge and experience in each business field
•H ave specialized knowledge or management knowledge suitable
for a supervisor•H ave a high degree of independence
Audit & Supervisory Board member candidates:
Have a wealth of experience and broad knowledge that will enable
more appropriate audits and oversight of overall management froma position that is independent from directors
For both types of candidates:
Have the character suitable for being a Board member, have highethical standards and not be self-serving
Nomination and Election Procedures for Directors(1) Select candidates based on the above criteria(2) Deliberate them at a Nomination Advisory Committee meeting(3) Approve them at a Board of Directors meeting(4) Elect them at the General Meeting of Shareholders
Nomination and Election Procedures for Audit & Supervisory Board Members(1) Select candidates based on the above criteria(2) Discuss them at an Audit & Supervisory meeting and gain approval(3) Deliberate them at a Nomination Advisory Committee meeting(4) Approve them at a Board of Directors meeting(5) Elect them at the General Meeting of Shareholders
Consideration Criteria for Termination

Policy &SystemWe consider including diverse human resources and utilizing their various
knowledge, experiences and skills to be an important growth driver toward the Integration of Telecommunications and Life Design. We believethat ensuring diversity also in the Board of Directors can lead to better
management decision making.
To ensure a diversity of opinions and highly specialized knowledge
within the Board of Directors as a whole when it makes decisions, including on important management matters, and when its oversight is requested by law, the people selected for the Board of Directors meet the following criteria regardless of sex, age, or nationality.
Through discussions held by the Nomination Advisory Committee,
we determined that, from the viewpoint of achieving sustainable growthat KDDI Group, the following expertise and background were crucial
elements to look for in outside directors / auditors for KDDI’s Board of
Directors: experience as a president of a listed company (management
know-how), specialized knowledge in the telecommunications field (ability
to support our main line of business) and specialized knowledge in law,accounting or government (for compliance purposes). By nominating
directors and auditors with such qualities, we provide well-balanced
supervision and advice to management. The expertise of KDDI’s outside
directors / auditors can be found on page 104.

• When the performance of a business that a director is responsible for or
the achievements of a department a director is responsible for are exceptionally poor• When the company is harmed by a major misstep or intentional violationof a law, regulation or the Articles of Incorporation in their execution ofduties• When the company’s credibility and reputation are significantly damagedby the inappropriate seeking of personal gain through the abuse of position or authority• When the company determines that keeping a director is not appropriate
Termination Procedures for Directors• After deliberations at the Nomination Advisory Committee meeting, theBoard of Directors deliberates the matter as needed and implements
necessary measures for termination.

KDDI Sustainability Report 2020

101

Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Corporate Governance

Types of Remuneration and Methods of Determination▪ Composition of Director Remuneration (excluding Outside Directors)

Policies and Decision Process for Determining Remuneration for Directors and Audit &Supervisory Board Members
Policy on Determining RemunerationsKDDI’s standard for board member remunerations are determined bycomparison with other companies in the same industry and of similar
scale in Japan while also taking into consideration the company’s state ofmanagement. Furthermore, the Remuneration Advisory Committee annually consults objective research data from outside specialized agencies toverify the appropriateness of the payment standard. The remunerations
are determined based on the roles and responsibilities given to each executive. Performance-linked stock compensation was introduced in fiscal
2015 for directors involved in conducting business to raise their motivation
for improving medium- to long-term business performance and corporate
value.Furthermore, in fiscal 2019, we introduced the stock price-linked
bonus to further motivate executives to achieve the goals of the Medium-Term Management Plan and to increase the link between board member remunerations and shareholder value. The performance indicators forthis system are the EPS* growth rate identified as one of the goals in theMedium-Term Management Plan, and the stock price change rate, which
is directly linked to increases / decreases in shareholder value.
The following are the four types of remunerations for directors involvedin conducting business.

KDDI

SystemDetermination of Board Member Remunerations Continued
A Remuneration Advisory Committee is in place to ensure transparency andobjectivity regarding the structure and standard of board member remunerations as well as the process for determining the amount. The chair, vicechair and the majority of the committee is comprised of outside directors.
• Chair: Goro Yamaguchi (Outside Director)• Vice Chair: Keiji Yamamoto (Outside Director)• Members of Committee: Shigeo Ohyagi (Outside Director) Riyo Kano (Outside Director) 
Shigeki Goto (Outside Director) 
Takashi Tanaka, Makoto Takahashi
The following topics regarding board member remunerations are decided
by the Board of Directors after being advised by the Remuneration Advisory Committee without first going to the representative director.
• Basic Policy on Board Member Remunerations• Remuneration standards for each director (basic remuneration, bonus,
stock compensation), time of payment, method of payment• Amount of performance-linked bonus, stock price-linked bonus andperformance-linked stock compensation to be paid

* Earnings Per Share•B asic remuneration•S tock price-linked bonus•P erformance-linked bonus•P erformance-linked stock compensation
Furthermore, the link between board member remunerations and performance / stock prices are determined based on each executive’s position
and the roles and responsibilities that are expected of them. In responseto placing responsibility on the stakeholders, the aforementioned link will
most closely be reflected in the president’s remuneration, as the person
who steers the company’s management. Of the president’s total remuneration, approximately 40% is comprised of basic remuneration and theremaining approximately 60% is linked to performance and stock prices.
Method of Calculating Bonuses and Stock Compensation
The performance-linked bonus and stock compensation (trust type) are evaluated based on the following criteria: company operating performance (thegroup’s revenue, operating income and profit for each fiscal year) and theachievement of KPIs in each business, which are linked to the goals in theMedium-Term Management Plan. They are calculated in the following ways.
Bonus: Basic amount by position multiplied by the company operating
performance and KPI achievement
Stock compensation: Basic points by position multiplied by the company
operating performance and KPI achievement
The stock price-linked bonus is evaluated based on the EPS growth rate
and rate of stock price change and calculated in the following way.
Stock price-linked bonus:
Basic amount by position multiplied by coefficients ((A × 50%) + (B × 50%))A) EPS growth rate:
EPS at end of current fiscal year divided by EPS at end of previous
fiscal yearB) Rate of stock price change (TOPIX growth rate): (Company’s stock price at end of current fiscal year / Company’s
stock price at end of previous fiscal year) divided by (TOPIX stock
price at end of current fiscal year / TOPIX stock price at end of previous fiscal year)
102

KDDI Sustainability Report 2020

If a serious violation is committed in a board member’s line of work that
goes against the mandate contract signed between by the Company andthe board member, a regulation is in place that allows the Company to confiscate stock compensation points that have already been awarded or demand the repayment of the amount equivalent to the stocks already issued.
Policies for Determining Remuneration for Audit & Supervisory Board Members
Remuneration for Audit & Supervisory Board members is decided by theconsensus of the members of Audit & Supervisory Board. These members
receive flat-rate remuneration that is not affected by fluctuations in thecompany’s operating performance.
Remuneration for Directors and Audit & Supervisory Board Members(FY2019)
Unit: million yen
Executive classification
Directors (excluding outside directors)
Outside directors
Audit & Supervisory Board members(excluding outside members)
Outside Audit & Supervisory Board
members

Total remuneration by type
Total
Numberremuneraof eligible
Basic
Stock
Bonus
tion
members
remunerationcompensation
889
75

383
75

297
—

209
—

10
7

52

52

—

—

2

50

50

—

—

3

1. The number of remunerated directors and the amount paid as shown above include one director and twooutside directors who retired at the conclusion of the 35th Annual Shareholders Meeting held on June 19,
2019. The number of directors who received bonuses was nine, excluding said retired directors.
2. At the 30th Annual Shareholders Meeting held on June 18, 2014, it is resolved that the maximum monthly
flat-rate remuneration for directors is 50 million yen.
3. At the 32nd Annual Shareholders Meeting held on June 22, 2016, it is resolved that the maximum annual
amount of remuneration for Audit & Supervisory Board members is 130 million yen. (For each business year).
4. At the 27th Annual Shareholders Meeting held on June 16, 2011, it is resolved that the amount of bonus for directors shall be no more than 0.1% of the consolidated net profit for the fiscal year and linked to performance.
5. The decision to continue and partially revise the performance-linked stock-type incentive program for directors (Board Incentive Plan) was resolved at the 34th Annual Shareholders Meeting held on June 20,
2018. This is separate from the bonuses, and the Company will pay said incentive to directors, etc., who
serve during the four years from fiscal 2018 to fiscal 2021.
6. In addition to the above, adjustment payments to directors in lieu of retirement allowance were resolved
at the 20th Annual Shareholders Meeting held on June 24, 2004 in connection with the cancellation of
the executive retirement bonus system.

Total remunerations and bonuses of board members who receive
over 100 million yen (3 people)
Unit: million yen
Name
Takashi Tanaka
Makoto Takahashi
Yoshiaki Uchida

Executiveclassification
Director
Director
Director

Total
remuneration
135
198
102

Total remuneration by type
Basic
remuneration
48
78
45

Bonus
59
68
34

Stock
compensation
27
52
23

Types ofForm ofremuneration(percentage of total) payment
Basic remuneration
Stock price-linked
bonus
Performance-linked
Bonus

Cash

Performance-linked
Stock compensation

Stock

Number of board
members at timeof resolution• Amounts determined by each director’s professional ranking are paid out every month
June 18, 2014
Directors (13)Maximummonthly
remuneration• Appropriate levels are considered using information from outside experts and set in con- of 50 million yen
30th General Meeting (including 3 Outsidesideration of the management environment and other factorsof Shareholders
Directors)
Bonuses are linked to and determined by the rate EPS growth and rate of stock price Within 0.1% of consolidated net
June
16,
2011
(10)
change.
income (profit attributable to own- 27th General Meeting Directors(excluding outside
Bonuses are linked to and determined by the rate of achievement of the group’s consolidat- ers of the parent under IFRS)
of
Shareholders
directors)
ed revenue, operating income and profit for each fiscal year, as well as the achievement of during the applicable fiscal year
certain KPIs, including net additions of Mobile IDs, au churn rate and value added ARPA
(Applies to directors, executive Introduced:
9 Directors, 21 Exofficers and administrative officers) June 17, 2015
ecutive Officers, 50
Calculation Formula
Bonus: Basic amount by position multiplied by the company operating performance and Total number of points (maximum) 31st General Meeting administrative offigrantedperfiscal
year
to
those
eliof
Shareholders
cers
KPI evaluation
Revised:(excluding overseas
Stock compensation: Basic points by position multiplied by the company operating perfor- gible:
357,000
points
June
20,
2018
residents, Outside
mance and KPI evaluation
Note: The amount paid in reference to each fiscal year’s performance is determined by the Board of Directors (Converted at a rate of 1 point = 1 34th General Meeting Directors andshare)
of
Shareholders
part-time directors)
after deliberations by the Remuneration Advisory Committee
Maximum amount of
remuneration

Content of remuneration and method of determination

Resolution ofshareholders meetings* Note: Outside Directors and Audit & Supervisory Board members are paid only flat-rate compensation that does not vary with the company’s performance to ensure they appropriately supervise and oversee management.

Policies on Transactions between
Related Parties

KDDI

PolicyIn accordance with the Companies Act, we require competitive or conflictof-interest transactions by directors to be approved by and reported to
the Board of Directors.
Individual transactions with major shareholders are conducted in accordance with one of the basic principles of the KDDI Code of BusinessConduct, specifically, IX. Appropriate Accounting and Adherence toAgreements. In line with this principle, such transactions are decided uponin the same manner as other general transactions, through internal requests for decision, rather than by setting special standards. The internal
requests for decision are checked by auditors as well.
Director of Kyocera Corporation, which is the major shareholder of thecompany, serves as an outside director of the company. Accordingly, we
strike a balance between comprehensive approval by and reporting to theBoard of Directors and internal requests for decisions on individual transactions to ensure the governance.

Outside Director Support System

KDDI

SystemIn order to ensure active discussions in the Board of Directors meetings, we inform outside directors and Audit & Supervisory Board members in advance of thedates and agenda items and provide agenda materials for upcoming meetings to
help them gain a deeper understanding of the items on the agenda. In addition,
we make deliberations more substantial by accepting questions beforehand andpreparing more extensive explanations for the meetings based on the questions.
We also provide a wide range of information outside the board meetings,
including on business strategies, management status, R&D and technology.
Each division’s general manager and manager provide detailed explanations of the general overview of business and issues and regularly report on the
management status of subsidiaries. In addition, we provide opportunities tovisit in-house exhibitions of R&D achievements as well as the telecommunications equipment and monitoring center and other workplaces. We also provide
two reports every year on corporate ethics and risk management activities.
To enable more thorough information gathering capabilities while maintaining the independence of Outside Directors, we hold regular liaison meetings be-tween Outside Directors and Audit & Supervisory Board members,
strengthening their cooperation. Accounting auditors also explain the resultsof audits to Outside Directors.
To bolster information exchanges and sharing between Outside Directors,
we hold liaison meetings with only Outside Directors and liaison meetings with
Outside Directors and part-time Audit & Supervisory Board members. We aim toraise the effectiveness of the Board of Directors supervision of management andto invigorate discussions of management strategies at board meetings by providing a deeper understanding of our business through these initiatives. On April
1, 2006, we established the Audit & Supervisory Board Member’s Office, which
supports Audit & Supervisory Board members, including outside members.

Communication with Shareholders

KDDI

PolicyWe consider our shareholders and investors to be especially important
stake-holders who fully understand and strongly support our business sustainability. Accordingly, we put the most emphasis on building trust-based relationships with them in our management and strive for value-oriented corporate
management, active information disclosure and enhanced communication. As
part of our ongoing effort to improve communication, we hold quarterly presentation sessions, where the management team presents the company’s financial results directly. In addition, we organize private meetings and smallscale meetings with investors both from Japan and abroad, attend various
conferences hosted by securities firms and hold seminars for private investors.
FY2019 Results• Financial Results Briefing for Analysts and Institutional Investors: 
4 times (held along with the quarterly financial disclosure)• International roadshow: 
10 times (including participation in 3 conferences sponsored by securities firms)• Session with institutional investors in Japan and abroad: Approximately 750 times• Seminar for private investors: Management conducted both online and in-person seminars. Around
1,600 investors participated (listened).

Vitalizing the General Meeting of Shareholders
and Facilitating the Exercise of Voting Rights

KDDI

SystemMeasures

Content

Early disclosure of General
Meeting of Shareholders notice

We send a notice around one week before the stipulated day by mail.
Prior to that, the whole notice is disclosed on our website

Scheduling to avoid days whenmany other companies holdtheir shareholders’ meetings

We schedule the shareholder’s meetings to avoid days
when many other companies hold their share-holders’meetings

Electronic voting system

Shareholders can exercise their voting rights via an online voting site. From the 2019 General Meeting of
Shareholder, we introduced a system where shareholders can log in to the online voting site using a QR codein an effort to make things more convenient.

Participating in an electronic
voting platform

We have joined the electronic voting platform provided
by Investor Communications Japan (ICJ)

English version of convocation
noticeWe publish a full English translation of the convocation noticeon our website, online electronic voting site and voting platform.

Others* Extracted from the Corporate Governance Report For details, see thewebsite below:

Shareholders can see the notice with their smartphone.
In addition, to encourage the participation of more shareholders in the General Meeting of Shareholders, we offer
sign language interpretation as well as a hearing loop.
The video of the meeting is available to anyone on demand on our website with sign language interpretation.

Web Link

Corporate Governance Report

Web Link

The 36th Annual General Meeting of Shareholders NoticeKDDI Sustainability Report 2020103Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Corporate GovernancePrincipal Activities of Outside Directors and Outside Audit & Supervisory Board Members

KDDI

Outside Directors

Activity &Results

Outside Audit & Supervisory Board members
Reason for selection as an outside director of the company(if designated as an independent director includes reason for this designation)

Principal activities
in FY2019

Name

Reason for selection as an outside Audit & Supervisory Board member of the company(if designated as an independent member includes reason for this designation)

Principal activities
in FY2019

Goro Yamaguchi
Male

Mr. Yamaguchi has an abundant wealth of corporate management experience and excellent knowledge cultivated as thepresident and representative director of one of the world’s leading electronic component and equipment manufacturers. In the
Board of Directors meetings, the company has received a large number of broad opinions related to business administrationand operations from him based on a medium- to long-term perspective and has determined that he can continue to contributeto improving the corporate value of the company. Accordingly, he has again been appointed as an outside director.

Board of Directors
100%(Attended 12 of 12
meetings)

Toshihiko Matsumiya(Independent auditor)
Male

Mr. Matsumiya has abundant experience as a Certified Public Accountant, as an employee of an auditing company, as therepresentative of an accountancy firm and as an auditor for other companies. From the perspective of leveraging this primarily
accounting-related knowledge and experience to monitor general management and to engage in appropriate audit activities,
he has been appointed as an Audit & Supervisory Board member. Moreover, with this background, we judge there to be norisk of a conflict of interest with general share-holders and accordingly he has been appointed as an independent director.

Newly Appointed(June 17, 2020)

Keiji Yamamoto
Male

Mr. Yamamoto has excellent knowledge cultivated in IT development and electronics engineering divisions and abundant
management experience as a management at the one of the world’s leading auto-mobile manufacturers. The company has
determined that he can contribute to improving the corporate value of the company by giving broad opinions on promoting 5G/ IoT strategy, etc. from a medium- to long-term perspective, and for these reasons he has been reappointed as an outside
director.

Board of Directors
100%(Attended 10 of 10
meetings)*

Jun Karube(Independent auditor)
Male

Mr. Karube has cultivated abundant experience as a representative director of a listed company. From the perspective ofleveraging this knowledge and experience to monitor general management and to engage in appropriate audit activities, hehas been appointed as an Audit & Supervisory Board member. Moreover, with this background, we judge there to be no riskof a conflict of interest with general share-holders and accordingly he has been appointed as an independent director.

Newly Appointed(June 17, 2020)

Shigeo Ohyagi(Independent director)
Male

Mr. Ohyagi has a wealth of corporate management experience and excellent knowledge cultivated as the president and CEOof one of the world’s leading companies in the fields of synthetic fibers, chemical products, medicines and medical treatment,
and distribution and retail. The Company determined that he can contribute to improving the corporate value of the Company
by giving broad opinions from a medium- to long-term perspective, especially focusing on the field of life design business that
the Company will pro-mote in the future, global strategy and M&A. Accordingly, he has been appointed an outside director.
Moreover, with this background, we judge there to be no risk of a conflict of interest with general shareholders and accordingly he has been appointed as an independent director.

Board of Directors
100%(Attended 12 of 12
meetings)

Shin Honto(Independent auditor)
Male

Mr. Honto has cultivated abundant experience and knowledge gained from many years of practical experience in the publicsphere and involvement in the execution of business at various organizations. From the perspective of leveraging this knowledge
and experience to monitor general management and to engage in appropriate audit activities, he has been appointed as an
Audit & Supervisory Board member. Moreover, with this background, we judge there to be no risk of a conflict of interest withgeneral share-holders and accordingly he has been appointed as an independent director.

Newly Appointed(June 17, 2020)

Riyo Kano(Independent director)
FemaleMs. Kano has abundant experience and superior knowledge, cultivated as a partner at a law firm and a committee member ofgovernment committees. The Company has determined that she can contribute to improving the corporate value of theCompany by giving technical opinions related to legal risk management from her experience based on a medium- to long-term
perspective independent of the management team, and for these reasons she has been selected as an outside director.
Moreover, with this background, we judge there to be no risk of a conflict of interest with general shareholders and accordingly
he has been reappointed as an independent director.

Board of Directors
100%(Attended 10 of 10
meetings)*

Shigeki Goto
(Independent auditor)
Male

Mr. Goto has a superior knowledge in information processing, telecommunications and network engineering, which is directly
relevant to the business of the Company, as well as a deep understanding of cyber security that is valuable for the operationof our business. In the Board of Directors meetings, he has offered expert opinions from an independent position from the
management team regarding operational policy as an information communications operator providing social infrastructure,taking a medium- to long-term perspective. We wish to benefit from his contributions to the enhancement of the Company’s
corporate value. Accordingly, he has been appointed an outside director. Moreover, with this background, we judge there to be
no risk of a conflict of interest with general share-holders and accordingly he has been appointed as an independent director.

Newly Appointed(June 17, 2020)

Name

Yoshiaki Nemoto
Male

Executive of Business: 9 persons

Chair
Independent Directors: 6 persons

The activities of Outside Directors who left at the end of the 36th Annual Shareholders Meeting are as follows.
Name

Composition of Board of Directors

Internal Directors

Principal activities in FY2019

Outside Directors

Board of Directors
Attended 12 of 12 meetings*Mr. Keiji Yamamoto and Ms. Riyo Kano attended the 35th Annual General Meeting of Shareholders when they were appointed as new directors. The attendance was counted after the appointment.

Audit &
Supervisory Board Members

Non-execution of Business: 10 persons

Diversity and Expertise of the Outside Directors
Name(Major background)

Position in the Company

Experience as president of alisted company

Goro Yamaguchi(Kyocera Corporation)

Outside directors●

Keiji Yamamoto(Toyota Motor Corporation)

Outside directors

Shigeo Ohyagi(Teijin Limited)

Outside directors

Riyo Kano(Lawyer)

Outside directors

Shigeki Goto
(Waseda University)

Outside directors

Toshihiko Matsumiya(Certified Public Accountant)

Outside Audit & Supervisory
Board members

Jun Karube(Toyota Tsusho Corporation)

Outside Audit & Supervisory
Board members

Shin Honto(Ministry of Land, Infrastructure,
Transport and Tourism)

Outside Audit & Supervisory
Board members

Expertise in thetelecommunications field

Expertise in law,accounting or government

●
●
●
●
●
●
●

Total
Outside Director

104

Outside Audit & Supervisory Board Member

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

105

Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Risk ManagementKDDI’s Approach(Risk Management and Internal Control)

KDDI Group

Our Risk Management and Internal Control KDDI Group

PolicyIn the ever-changing business environment, the risks that companies faceare increasingly diverse and complicated.
We define factors and events that negatively influence the achievement of our business goals as risks and consider enforcing risk management a material business challenge. In order to be sustainable and responsible to society, we promote risk management initiatives throughout
the KDDI Group.

System

We have established a system to centralize the management of risks,
which we define as factors that have the potential to block the achievement of our business goals, with the Corporate Risk Management Divisionat the core.
Furthermore, we are promoting risk management throughout theKDDI Group, including subsidiaries, in order to realize the continuous
growth of the entire group. We have appointed 28 Internal Control System
Managers within KDDI and 44 at group companies, as well as six Internal
Control System Directors to oversee their activities. Under their leadership,
we introduce and run internal control systems, carrying out risk management activities and run operational quality improvement activities to foster
a company culture in which risks are less likely to arise.

Risk Management Activity Cycle

KDDI

In order to prevent critical events for the company, we at KDDI consider
that it is important to recognize signs of danger and implement preventive
measures before the situation worsens. Based on this idea, we follow the
PDCA cycle for risk management. We also have an organizational framework for risk management in place to ensure any risks we find will be addressed promptly and appropriately.
Management Level

Present significant risks

Report the situations

Risk management by sectors and subsidiaries▪ KDDI Group Internal Control Framework
Audit &
Supervisory
Board
members• Audit in accordance with laws andthe articles of incorporation relating
to directors’ business execution

Collect and analyze information
and assess risks

Board of Directors

P• Decide basic policies for building internal control framework
Improveand adapt

Corporate Management Committee• Evaluate internal control and announces the results

Representative: Internal Control Department,
Corporate Risk Management Division

Accounting
Auditors

SystemDAC

Examineandimplement
countermeasures

Execute intradivisional monitoring
Internal Audits

Risk Identifying ProcessKDDI Group Activity

We regularly examine information about risks to identify significant risks
that seriously influence corporations, and discuss measures to reducesuch risks and their impacts as much as possible in case we face them.
In order to ensure the achievement of our business goals, in fiscal
2019, we selected 25 significant risks based on issues that manifested
in the past and changes in the business environment, and held internal
audits centered on risk prediction, the reduction of significant risks andrisk approach. The selected significant risks include cyber-attacks, an areathat is becoming increasingly complex, global businesses, and issues
relating to new business fields we are entering, such as e-commerce,
finance and accounting, and energy, which aim to make the Integration of
Telecommunications and Life Design a reality. We have also identified
risks arising from the expansion of the group through M&A as significant
risks and have implemented more robust measures against them.
In order to minimize information security risks, we have also established a common standard applicable group-wide to improve the level of
information security across the group, including newly joined group companies.
The status of these significant risks is also reflected on business risks
that are revealed in the Securities Report since it relates to the finance as
well.

Web Link

Securities Report / Business Risks (Japanese only)

Web Link

Basic Policy for Constructing an Internal Control System• Formulate implementation plans• Manage overall progress• Support operations of implementing divisions• Audit evaluations by managers

KDDI GroupInternal Control System Directors (6)Internal Control System Managers (KDDI: 28, group companies: 44)

106

As of June 1, 2020

Parent Company Business Divisions

Parent Company Corporate and Support Divisions

Subsidiaries

Secretariat

Secretariat

Secretariat

Individual Organizational Units

Individual Organizational Units

Individual Organizational Units

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020107Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Risk Management

Basic Policy for Constructing an Internal Control System
Based on the provision of Article 362, Paragraph 5 of the Companies
Act, we passed the Basic Policy for Constructing an Internal Control
System at a meeting of the Board of Directors. In addition, we publicly
announce resolutions and our operational status to ensure the fair,KDDI Grouptransparent and efficient execution of our corporate duties and maintain an effective system for internal controls to raise the company’s
quality level.

Web Link

PolicyBasic Policy for Constructing an Internal Control System▪ Main Operational Risks
Risk

Competitors, rival technologies andrapid market shifts

Risk background• The need to provide user support for product defects problems
attributable to the rapid expansion of the commerce business• Inability to acquire needed bandwidth we need• Increase in competition due to new high-speed wire-less datatechnology• Possible rise in connection fees with other telecommunications
operators• Intensifying competition as a result of changes in the businesslandscape due to partnerships with other industries, sales packages that include other products (such as telecommunications+ power), the emergence of MNOs and MVNOs in the market
and other companies expanding their business fields

Potential impact on KDDI• Negative impacts on the financial position and operations of theKDDI GroupKDDI’s response• The creation of new value and and the achievement of sustainable growth in the 5G /IoT era domestically and globally with a business strategy that focuses on the “integration of telecommunications and life design,” which centers on telecommunications
and expands peripheral businesses• Establishment of the KDDI Code of Business Conduct, KDDI Security Policy, andKDDI Privacy Policy• Internal privacy breaches•U nauthorized access from external networks• Could seriously damage the brand image of the KDDI Group. In
addition to a possible loss of customer trust, we could also beforced to pay substantial compensation or surcharge• In the future, we may face higher costs to develop the frameworknecessary to protect the confidentiality of communications andcustomer privacy• Could have a negative impact on the financial position and / orearnings performance of the KDDI Group

System failures due to natural disasters
and other unforeseen events• Natural disasters, such as earthquakes, tsunamis, typhoons, orfloods, as well as secondary damage (pandemic) from the
spread of toxic substances caused by natural disasters• Worldwide
spread of an infectious disease (pandemic)• War,

terrorism, accidents, or other unforeseen events• Powerbrownouts or blackouts• Computerviruses or other forms of cyber-attack and hacking•O peration system hardware or software failures• Flaws
in communication equipment and services• Service outages or interruptions as a result of large-scale natural
disasters or accidents caused by climate change, etc.
• Loss of opportunities to offer products and services due to service
outages as a result of failures in network systems or communication equipment, substantial billing errors, closing of distributors, or
suspension of distribution could damage the brand image of theKDDI Group and lead to loss of customer trust and decreased
customer satisfaction, which could have a negative impact on theearnings performance• The Company’s future business activities and earnings performance could be affected by fewer new customers due to shortened hours at au Shops, reduced mobile data usage due to increased WiFi usage for remote work, and the various influences on
our life design business and solution services for corporate customers• Initiatives to improve reliability of our network and prevent service outages by implementing Business Continuity Planning• Establishing a disaster response headquarters as early as possible in the event of an
emergency or disaster

Laws, regulations, and government
policies
relating to the telecommunications
sector• Revisions to the calculation formula for inter-operator connection fees and / or accounting methods• Revisions to designated telecommunications facilities system
and / or the regulations on prohibited activities•R evisions to the universal service systems• The emergence of MNOs and MVNOs in the mobile communication market• Revisions to the frequency allocation system and / or spectrum
user fee system•R ules regarding electricity retail and financial business•R ules regarding the usage of personal data

• The KDDI Group’s earnings performance could be negatively impacted by the revision or abolishment of laws and regulations orformulation of government policies relating to telecommunications
and finance business• KDDI’s earnings performance could be negatively impacted if thecompany’s competitive advantage is relatively diminished as aresult of competition policies• Taking appropriate actions based on laws, regulations and government policies• Advocating measures for fair competition with other telecommunications operators
through various deliberation councils and study sessions as well as the public comment system of the Japan’s Ministry of Internal Affairs and Communications

Acquisition of human resources,
training and personnel management•R ise in human resources investment costs in the future• If we are unable to handle matters appropriately in the future, theKDDI Group’s brand image could be damaged, leading to loss ofcustomer trust and a negative impact on our earnings performance• Working together across the entire company to support personnel training and careerdevelopment to keep up with technological innovations• Appropriate personnel management and the promotion of work style reforms basedon the law

Protection of confidentiality ofcommunications and customer privacy• Establishment of the Business Ethics Committee• Reinforcement of various technical, organizational and human safety management
measures• Educating all employees on the protection of confidentiality of communications andcustomer privacy• Working with our external partners, particularly with our retail network of au Shops, tostrengthen management through the improvement of shop operations, monitoring
and training• Establishing Information Security Committee• Acquiring external authentication (ISMS) in the whole company• 24 / 7 monitoring of external attacks by specialists

Initiatives in Response to the Internal
Control Reporting System (J-SOX)

Activity &Results

KDDI GroupIn response to the internal control reporting system based on the Financial
Instruments and Exchange Law implemented in fiscal 2008, we conducted evaluations of the internal controls at KDDI and 10 major group subsidiaries (totaling 11 companies) in and outside Japan to ensure reliability of
our financial reporting. The results of these evaluations were compiled in
an internal control report, which was submitted to Japan’s Prime Ministerin June 2020, as well as disclosed to investors.

Web Link

Securities Report / Internal Control Report (Japanese only)

Activities toEnhance Operational Quality

KDDI

System &Awareness
Raising

In conjunction with the internal control reporting system, we establishedan Internal Control Department that promotes initiatives for improving theoverall operational quality of the whole company, and Internal Control System Managers in each department facilitate initiatives that enhance theefficiency and standardization of operations to do so.
Initiatives that are successful at improving business operations areadded to a database, enabling all employees to put them into practice intheir own departments.
Furthermore, to further raise each employee’s awareness and motivation regarding the improvement of operations, we have introduced the
Operational Quality Improvement Prize to recognize excellent and ambitious initiatives. In addition, we have started working on the introduction ofrobotic process automation (RPA) across the company as a way of improving operational quality, productivity, and efficiency at the same time,
starting with the preparation of the RPA system environment and education programs.
Activities to Enhance Operational Quality• e-learning training• Sharing messages from executive officers and good examples of initiatives in e-mail newsletters and internal magazines• Implementation of Operational Quality Improvement Prize (Once a year)* For details, please see the Business Risks section of the Securities Report for the year ended March 31, 2020.

Web Link
108

Securities Report for the year ended March 31, 2020 (Japanese only)KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

109

Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Customer Relationship Management
Customer Satisfaction Improvement
SystemKDDI

Policy &System

We will continue aiming to achieve sustainable business growth by enhancing customer engagement and actively breaking ground in new life
design fields, especially those related to telecommunications. To better
understand the needs of our customers and provide more fulfilling andconvenient lifestyles, we aim to further improve customer experience (CX)
and provide customers with exciting experiences by expanding our life
design services into areas like commerce, energy, finance and entertainment, focusing on our existing communication services.
Toward that aim, we at all departments strive to refine and connect all
points of contact with the customers, working on cross-departmental
improvements across au Shops, communication and sound quality,
products, website, rates and services. We share the progress at the CX
Promotion Meeting that is held once a month, attended by top executives,to speed up the process.
Many evaluations, criticisms and comments we receive from customer
questionnaires form the guidelines for our behavior. Reflecting these
opinions sincerely in our business completes the cycle of offering further
value to our customers.

Collecting Customer Feedback

KDDI

System

We sincerely listen to valuable customer feedback and immediately translate it into action to continuously refine our services and quality.
Based on their opinions and demands, we analyze and identify problems using the internal system that is updated daily. When prompt decision making is required, management executives and representatives ofrelated divisions meet and discuss how to solve problems throughout thecompany. In order to share customer feedback with the whole company,
we also have an intranet all employees can access and see their comments (excluding their personal information).

Web Link

Improvement Initiatives (Japanese only)

Web Link

Services that Have Come from Customer Feedback (Japanese only)▪ Framework for Collection of Customer Feedback

Telephone inquiries

System &Activity

Annually
Approx. 12 million

Questionnaire survey
au Shop inquiries

Analysis of customer
feedback
Clarification ofproblem

Inquiries
Improving customer experience(improvement of service, quality, response, etc.)

Examination andimplementation of
improvement plans

Discussions duringcommittees involving
management executives
and representatives ofrelated divisions

KDDI

Activity

Multilingual Support Initiatives

KUG: KDDI Enterprise Users’ GroupKDDI Enterprise Users’ Group (KUG) is an organization operated by our
corporate customers. In KUG, which KDDI supports as the organizer,
members from various industries gather and hold seminars, observation
tours and workshops in order to interact, study and cultivate friendships.
These activities also provide opportunities for KDDI to collect opinions andfeedback from members to improve services and develop new products.
Through exclusive observation tours and seminars, KUG aims toaccelerate the communication between its members and KDDI.

Initiatives

Content

Introducing videointerpretation
services

Promoting introduction of video interpretation service in 13
languages (English, Chinese, Portuguese, Korean, Vietnamese, Tagalog, Spanish, French, Thai, Nepalese, Hindi, Russian and Indonesian)Translating
various sales tools

Translated contract documents, notice, catalogs, flyers, etc.,
for customers in seven languages

Making au
Support Movies

Made videos in English to provide information on au services
and answer frequently asked questions

FY2019 activity results

9 events
Multilingual Support Initiatives at au Shops

Initiative

Other Initiatives

Corporate Management
Committee
Important matters

Initiatives for Corporate Customer
Satisfaction

Right now, KDDI’s many corporate customers are promoting digital transformation (DX) to grow their businesses.
To respond to the diversified and sophisticated needs of such customers, KDDI is committed to its policy of “creating new value through DX
together with our customers.” To this end, we strive to communicate
closely with our customers and look at matters from their perspectives inan effort to help turn their DX visions into reality.

KDDI

Email inquiries

Opinions / Advice

KDDI

Ensuring Multilingual Support at au Shops
Following the rise in the number of non-Japanese customers, we have
prepared survey forms in multiple languages for visitors to our shops.
Based on the results of the survey, we further enhance multilingual support at each shop for customers from countries other than Japan so that
they, too, have a better experience.
These initiatives invite more people to choose au.

Web Link

CustomerFeedback
Customers

Initiatives for Customer Satisfaction

Initiative
Customer feedback
shared between
all employees

au CX AWARD

au Support
Moviesau Smart Support

Details
Each years, KDDI presents awards for day-to-day initiatives
at au Shops and holds the Customer Service Contest in locations throughout Japan to share success stories.
Movies explaining how to use smartphones and popular
apps in video form

Web Link

Web Link

KDDI Enterprise Users’ Group(Japanese only)

au Support Movies

We offer a membership-based support service offering tailored support for customers using smartphones

Web Link• Introduced our efforts related to disaster resilience and service quality
control through tours of the KDDI Shinjuku Building• Offered opportunities for people to experience “design thinking,” a problem solving method, at KDDI DIGITAL GATE
• Organized seminars to share the latest trends in ICT solutions

au Smart Support (Japanese only)

Customer Satisfaction Survey

KDDI

Results &Analysis

Assessments of au Services in the Consumer Market
Consultations

Evaluation
Ranked highest in overallsatisfaction(four consecutive years)

J. D. Power: 2
 019 Mobile Phone Service
Satisfaction Study

Assessments of KDDI Services in the Corporate Market
Consultations

110

KDDI Sustainability Report 2020

Evaluation

J. D. Power: 2
 019 Business Mobile Phone Service
Satisfaction Study <Large Enterprise /Midsize Business Segment>

Ranked highest in overallsatisfaction(four consecutive years)

J. D. Power: 2
 019 Business IP Phone & Direct Line
Phone Service Satisfaction Study

Ranked highest in overallsatisfaction(seven consecutive years)

J. D. Power: 2
 019 Business Network Service
Satisfaction Study<Large Enterprise Business Segment>

Ranked highest in overallsatisfaction

KDDI Sustainability Report 2020111

Top Message

Corporate GovernanceRisk Management

Customer Relationship ManagementKDDI’s Commitment to Sustainability

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Brand Management

Brand ManagementKDDI’s Approach (Brand Management)

KDDI

PolicyKDDI and au each have brand slogans.
The slogan for the KDDI brand, which is for the corporate and business market, is “Tomorrow, Together.” The slogan for the au brand, which
is for the consumer market, is “Explore the extraordinary.” Each of theseslogans represents how each brand wants to exist for customers andsociety. Our strategy is to use the KDDI brand for the business market
and the au brand for the consumer market, but both brands share theunderlying concept of moving in the direction of a more exciting and fulfilling future (tomorrow) together. The slogans are a reflection of our commitment to better understand our customers and continue being the company
that people choose. They also express our endeavors to increase the trust
we have earned from many companies and to work together as partners.
We are making company-wide efforts to promote the improvement ofcustomer experience value, which leads to customer satisfaction. Establishing a strong brand and managing it properly is one of our key issues.
For the proper management of our brands, we are striving to raise
employees’ awareness of issues like unauthorized use of trademarks andinappropriate use of logos by third parties, so as not to affect customer
satisfaction or bring any disadvantage to society.

Advertising Policy to Establish Our Brands

KDDI

PolicyTrue to our slogans “The company the customer can feel closest to,” “Acompany that continues to produce excitement” and “A company that
contributes to the sustainable growth of society,” we aim to promote theimprovement of customer experience value. We aim to understand ourcustomers through all points of contact and provide the best services at
the right time.
Our advertising and publicity are strongly promoted as one way torealize this policy.

Our Approach toAdvertisement Production

KDDI Sustainability Report 2020

PolicyAdvertisement and Brand Building Efforts

KDDI advertisements are created with the idea of contributing to improved
customer satisfaction, based on the rules of the Act against Unjustifiable
Premiums and Misleading Representations as well as voluntary standards
and guidelines on placement of telecommunications services advertisements, to avoid interfering in the autonomous and rational choice of customers by unfair enticement.
When creating an advertisement, each department shares detailed
information about the purpose of the advertisement and the details of
the product or service. The created advertisement is inspected at eachdepartment before it is submitted to the review department for final approval. As a rule implemented since 2013, advertisements cannot be usedwithout passing the final review. We select media that can be effective
points of contact for communication with customers, as well as being costeffective.

Starting in January 2015, we rolled out the Santaro TV commercial series,
and from January 2018, we rolled out “too sophisticated Takasugi-kun”
series. In an effort to spread the brand image of au under the new brandslogan “Explore the extraordinary,” we will continue to run both series withthe aim of further increasing our popularity.

FY2019 Violation of Regulations
There were no violations of any regulations related to marketing or communication (the Act against Unjustifiable Premiums and Misleading Representations).

* Listed as Brand of the Year for five consecutive years

FY2019 Review Results• Number of advertisements inspected by the review department: 4,756• Results of review: Advertisements that might violate laws and regulations
were all rectified
Promotion regime

External Recognition(Subject: The Santaro TV Commercial Series and the “Too Sophisticated Takasugi-kun” Series)
CM Soken Consulting
FY2019 Commercial Popularity Ranking by Company:
First Place (April 2019–March 2020)

Advertisement Department

Activity &Results

Starting Up Old Phones: A Trip Down Memory Lane
Starting Up Old Phones: A Trip Down Memory Lane is an event held byKDDI to recharge and start up old phones that people used to use to printout nostalgic photos stored in the device. The service is free of charge
and also accepts phones that are not au. So far, it has been held 215
times at KDDI directly managed outlets across Japan and at various
events. Over 7,900 people have participated.

FY2019 Commercial Popularity Ranking by Brand:
First Place (November 2018–October 2019)

SponsorshipAs one of our initiatives to improve our brand value, we sponsor sports
contests, cultural organizations and social and cultural projects. By offering new ways of watching sports in the upcoming age of 5G popularity
and through other forms of support, we aim to create new value and provide excitement for customers.

Soccer

As a supporting company of Japan’s national soccer
teams, we support all the soccer teams representing thecountry, including the Samurai Blues (men’s team) andNadeshiko Japan (women’s team). We also sponsor the
J.League teams Kyoto Sanga F.C. and Nagoya Grampus.

BaseballWe support baseball as a sponsor of the Yokohama
DeNA BayStars.

Sport climbing

As the official sponsor of the sport climbing category of
the Japan Mountaineering and Sport Climbing Association, we support sport climbing and sponsor “Team au,”made up of five climbers

Motor sports

We sponsor the TGR Team au Tom’s in Japan’s biggest
GT race, the Super GT.

E-Sports

E-sports are growing in popularity around the world, andwe support the spread of e-sports in Japan as the official
sponsor of the Japan eSports Union (JeSU) and as asponsor of the pro team DetonatioN Gaming as well as
various e-sports competitions and events.

UNIVASWe support the promotion and development of university
sports as a partner of the Japan Association for University Athletics and Sport (UNIVAS).

Sports of HeartWe sponsored Sports of Heart 2019, a sports and culture festival organized so that disabled and non-disabled
people can have fun together.

Tokyo Jazz Festival

We sponsored Japan’s biggest jazz festival, the 18th
Tokyo Jazz Festival 2019.

Kirishima International Music Festival

We sponsored the Kirishima International Music Festival
2019, which was held with the purpose of creating opportunities to listen to concerts and learn from expert
musicians.

Digital Marketing Department• Increases engagement with My au•M anages owned advertising websites

KDDI* Listed as Best Advertiser for six consecutive years

Marketing Communications Division• Formulates communication plans• Promotes communication activities• Develops brands / manages trademarks

112

KDDI

KDDI Sustainability Report 2020113

Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

Stakeholder Engagement
Stakeholder Engagement :Our Approach and System

KDDI

Policy &SystemStakeholders that influence our businesses are diverse, ranging from
customers, shareholders, business partners, employees and their families
to local communities. We at KDDI implement various activities to offer
new, satisfying experiences to all stakeholders in our business operations.
We also use the GRI Sustainability Reporting Standards, SASB, IIRC,
ISO 26000 and other global sustainability standards; JIS Z 26000, Environmental Reporting Guidelines, Guidance for Collaborative Value Creationand other domestic standards; and checklists that consist of questions
we receive from investors. With these, we create and implement policies
for assessing our current conditions and addressing management issues.
The results of engagement efforts are not only reported and shared within
the company but also reported at relevant committees and management
meetings and reflected in the decision-making process. KDDI values the
dialogue with all our stakeholders who support us. We will continue tobuild up collaboration with our stakeholders and tackle societal issues tocontribute to the development of a truly connected society.

Stakeholder Dialogue

KDDI

Activity

We conduct stakeholder dialogue led by the Executive Officer of Sustainability. Through the dialogue, we incorporate the opinions and requests ofstakeholders in our corporate management to build schemes for making
further improvements.
In fiscal 2019, we had dialogue on the theme of SDGs.

Results of Stakeholder Engagement
Stakeholders

Service Users

Web Link

Web Link

Stakeholder Dialogue

Web Link

Enhancing Internal Understanding of Sustainability and SDGs

Customer
RelationshipWe strive for the satisfaction of our service users (customer
experience) by living
up to their trust andoffering safe andvaluable products
and services.

Shareholders and Investors

Web Link

Corporate
Governance

We work to build a
relationship of trust
through honest andfair disclosure of information and active
communications.

Service Users

Satisfaction ofService Users
Job Satisfaction

Shareholders
andInvestors

Local Communities

Web Link

Community
Involvement

Trust

We collaborate andwork in partnershipwith local communities and fulfill our duties as a corporate
citizen.

Business
Partners(Suppliers)

Partnership=

All Stakeholders

Collaboration andCooperation

Customers

Local
Communities

NPO/NGO

Web Link

Community
Involvement

Administrative Organizations/ Industry Groups
Sound
Relationship

Administrative
Organizations /Industry
GroupsDialogue andCollaboration

Web Link

Participation inExternal Initiatives

Influence on the management
and business activities

Releases on media, websites
and social media

As needed• S pread information about thecompany and business activities• Spread information appropriately

Inquiries at customer center(telephone / web)As needed

au Shop service counters / retail
networks

As needed• Response to inquiries from customers• Share feedback to improve our
products and services acrossthe company• I mprove customer experience value• T he departments in charge
improve convenience of
products and services andguarantee safety

General Meeting of Shareholders

Once a year

We contribute to abetter society
through dialogue andcooperation.
We comply with thelaw and maintainsound relations.

Four times a year

Labor Practices

Business Partners (Suppliers)

Web Link

Supply Chain

We continue to be a
dynamic company thatprovides job satisfaction to all employees

We build partnerships
based on mutual trustand carry out appropriate business activities with fair and opentransactions.

• Share business reports, consolidated financial reports, financial
statements, auditors’ reports• R eport financial results andbusiness initiatives

Disseminating information throughShareholder Communication

Twice a year

Session with institutional
investors in Japan and abroad

Over around
750 times a year• Explain and exchange opinions
on financial results and businessinitiatives

Seminar for investors

Several times
a year• Specific sessions such as SDGs
briefings, seminars for private investors, etc.

Spread information throughwebsiteAs needed• D issemination of informationsuch as various reports, documents and details of initiatives

Social contribution programs ineach region

As needed

Information Ethics Classes (KDDI
Smartphone and Mobile Phone
Safety Classes, Raise Disaster
Risk Reduction Literacy with Your
Smartphone) and environmental
education held at schools andcommunity facilities

As needed• Strengthen governance• D eliver information using
websites and other information tools with a sincere attitude• P romote efforts to achieve
SDGs• Exchange opinions through local
administrative organizations•Interact with local residents andcontribute to local safety and development• Reflect opinions on the environment conservation activities• S olve social issues in partnership with administrative
organizations and local communities• Practice social contribution activities across the world• Initiatives

• Understand the social issues
and needs in each community• C ollect information and exchange opinions• M ake proposals on various
guidelines and deregulation

Community
Involvement

Activities funded by the KDDI
Foundation

As needed

Events hosted in cooperation
with NPO/NGO

As needed

Participation in conferences /councils

As needed

Participation in Initiatives

As needed

Employee Awareness Survey(Employee Engagement Survey)

Several times
a year• Conduct surveys on employees’
motivation to actively contributeto the company and their work

12 times a year

• Direct communication between
employees and the president

Ten times a year

• Direct communication between
employees and board members

A dozen times
a year• D iscuss and promote mutual
understanding about labor
management issues

KDDI Sports Festival(Co-hosted with the labor union)

Once a year

• Create a sense of unity throughencouraging interactions among
KDDI Group employees including their families and management• C r e a t e a s e n s e o f u n i t ythroughout the company

Surveys and liaison conference

Once a year• Share Sustainable Procurement
Policy• P romotion of responsible
procurement through supply
chain

Excitement Tours

Web Link

KDDI Sustainability Report 2020

Content

NPO/NGO
Employees and Their
Families

114

Frequency

Web Link

KDDI

Activity &Results

Communication methods

Results briefing▪ Stakeholder correlation diagram

Employees
and Their
Families

KDDI

Opinion exchanges between
management and employees• Analyze the state of companywide organizational culture
and identify issues to be
tackled in each department• Respect human rights

KDDI Sustainability Report 2020115

Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate Profile

Participation in External Initiatives

KDDI

PositionInternational Standardization of Telecommunications

ITU-R(Radio Sector)• WRC-19 COM5 Chair (World Radiocommunication Conference; satellite matters, etc.)•S G4 Vice-chair (Satellite Communications)

ITU-T(Standardization Sector)• SG3 Chair (Rates & Policy)• SG9 Chair (Video Transmission & CATV)•S G17 Vice-Chair (Security)

3GPP(Third Generation Partnership Project)• SA Plenary Vice-chair (Service & System Aspects)

Building a Safe and Secure Society
Vice Chair / Director

Conservation of the Global Environment
ICT Ecology Guideline Council

Head of Council

Promotion of Diversity and Inclusion
NPO J-Win

Advisory Board Member

TopicsActivity &Results

We endeavor to participate and play a leadership role in initiatives andorganizations in and outside Japan to contribute to the development of atruly connected society.

Japan Smartphone Security Association(JSSEC)

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

Community Involvement and Development

Stakeholder Engagement

Initiative

KDDI’s Commitment to Sustainability

SDG-focused Initiatives through the GSMA
KDDI is actively helping achieve the 17 SDGs with the GSMA, which
represents mobile telecommunications operations around the world. In
fiscal 2019, a guidebook published for the industry on natural disastermanagement features many of KDDI’s initiatives as best practices. These
include our ability to restore services from the sea with KDDI Ocean Link,a cable laying vessel equipped with a base station; public disastermanagement trainings held jointly with local municipalities; and cooperative
efforts with other businesses during disasters. The initiatives underscorethe importance of being connected, which we learned from past disasters.
They also aim to convey the weight of our responsibility as an industry thatprovides essential services, and to serve as examples for businesses inother countries on how to build systems that ensure telecommunications
services and swift service restorations during disasters.

Web Link

GSMA website: Mobile for Development

KDDI’s ApproachKDDI Group(Community Involvement and Development)

PolicyWe at KDDI Group are driving various initiatives to solve societal andenvironmental issues of the countries and regions where we operate tocontribute to the development of a truly connected society. Each regional
office leads community development activities, placing importance on
dialogue and cooperation with a variety of stakeholders, including local
communities, administrations, universities and NPO/NGO.

Policy on Corporate CitizenshipKDDI Group

PolicyWe established the Social Contribution Policy in 2012. As a conscientious
corporate citizen, we respond to the society’s needs and trust and contribute to society across the world utilizing our technologies and humanresources. To carry out sustainable business in and outside Japan, it isessential to have dialogue with local communities and grow with them. We
see social contribution activities as valuable opportunities to interact withlocal communities and will continue to capitalize on such activities in termsof business opportunities and risk avoidance.
We established KDDI Sustainable Action in line with the KDDI SDGs
for 2030 and are committed to resolving various social issues through ourbusiness as a company that contributes to society’s sustainable growth.
In addition, when deciding on and implementing philanthropic endeavors,
including social contributions and donations, we consider the relation toand impact of our own business activities as well as issues common to
the international communities, such as the SDGs. We are currently
considering policies, methods, and other measures.

Web Link

KDDI Basic Guidelines Concerning Safe and Secure Communication for Young People

Web Link

KDDI Sustainable Action

Management Framework

KDDI Group System

As a corporate citizen, we at the KDDI Group strive to contribute to community development, matching the needs specific to a region where we
operate.
Based on the basic policy and direction indicated by KDDI’s head
office, the regional offices around Japan are committed to implementing
sustainability activities, acting as communicators with local communities.
These activities are handled cross-departmentally by each regional officeand the executive officers in charge of each region (senior general managers) have overall responsibility for the activities.
Regional offices discuss the opinions they receive from local communities with the related department in KDDI head office and take action.
We have an information sharing framework within the group, including an
intranet, to share activities in each region.

The Plus Alpha Project ProgramKDDI Group Activity

From fiscal 2008, we started the Plus Alpha Project program that encourages our employees to actively participate in voluntary activities. In thisprogram, employees earn points for social contribution activities within or
outside the company, and the company donates an amount corresponding
to these points to charity organizations on behalf of the employees.
All employees (approx. 17,000) are eligible, and a total of 8,679,000 yen
was donated to 49 organizations in fiscal 2019. The total amount of donations made since the beginning of this program is 82,549,748 yen.

Manifesto
Operating in accordance with the KDDI Group Philosophy, by satisfying all its
stakeholders the KDDI Group seeks to contribute to society’s happiness byencouraging fulfilling lives for people around the world in a sustainable manner.
Action Guidelines
1. As a company involved in information and communications business, KDDI recognizes its social responsibility to address societal
issues through the use of information and communications technologies (ICTs). We aim to offer appropriate communication environments that are safe and secure for all people.
2. KDDI has established medium-term themes for its social contribution activities in five areas: “bridging the digital divide,”* “sounddevelopment of youth,” “environmental conservation,” “social andcultural support,” and “support in times of disaster.” By maximizing our application of such resources as networks, products andservices, we conduct social contribution activities through ICTs, ina manner characteristic of KDDI.
3. Through communications with stakeholders, we notify and share
information concerning ongoing improvements in the content of
our operations, thereby contributing to society’s development.
4.	By sharing with KDDI Group employees our directions on social
contribution activities, we pursue independent-minded activities
as a good corporate citizen in the aim of achieving sustainablegrowth in tandem with society.

116* Issue where an information disparity occurs between people who have access to information andcommunication technology such as the computers and the internet and those who do not

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020

117

Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

Community Involvement and Development
Workshop-Style Classes:
Raise DRR Literacy with Your Smartphone

KDDI

Activity

Japan is struck by major natural disasters almost every year, and education for disaster risk reduction (DRR) is becoming increasingly important inschools. We have been holding workshop-style classes named Raise DRR
Literacy with Your Smartphone for high school students since fiscal 2017
to teach them how to effectively use ICTs as a lifeline in the event of adisaster. A social media network was specially created for learning how toshare information during the classes. In total, these workshops have been
held at 40 schools with over 2,000 participants to date.
▪ Comprehension Questionnaire
Questionnaire
content▪ Results (FY2019)
Understood well

77.0%

21.2%

KDDI

Results

KDDI is a member of the 1% Club established by Japan Business Federation. Our total social contribution expenditures were 1.01 billion yen
in fiscal 2019.
1. Advertising expenses and membership fees are excluded even if they have the goal of social
contribution. Political contributions are not included in total social contribution expenditures.
2. In-store fundraising and employee donations are not included in total social contribution expenditures

Volunteer Leave and Number of
JICA Volunteers (KDDI)KDDI

Did not understandDid not understandvery well
1.1%

0.6%

▪ Percentage of positive responses

FY2015FY2016FY2017FY2018FY2019

16

20

13

29

17

JICA
Unit:
Volunteers* Person dispatched

2

1

0

0

0

* The number of JICA volunteers (Youth Overseas Cooperation Volunteers participation system) is
the number of people KDDI employees are dispatched to JICA in each fiscal year.

Disaster Relief Fund (FY2019)

98.2%▪ Japan

Web LinkKDDI’s IT Literacy Training: Reducing Disaster Risk with Smartphones

The Shimamono Project, which aims toinvigorate the communities in outlying islands

KDDI

Activity

Japan has around 420 populated outlying islands. These communities arefacing various challenges, such as young people moving away from theislands, population decline, how to create value and convey the allure of
the islands as well as a lack of know-how regarding logistics and sales
activities.
To aid outlying island communities, KDDI has teamed up with the
NPO Rito Keizai Shimbun (The Archipelago News) on the Shimamono
Project since fiscal 2015. In addition, KDDI hosts Shimamono Marche on
its own shopping site au WALLET Market to sell goods produced in outlying islands. We also hold the Shimamono Lab, which is a course for
outlying island businesses on branding and promoting products. The
Shimamono Lab is now offered in a total of seven areas.
In addition, sales from Shimamono Marche reached a cumulative totalof around 58 million yen (22 islands, 36 products, as of March 31, 2020).

Web Link

Case
Heavy rain damages
in August 2019

▪ KDDI Group Results(1) Bridging the Digital Divide
FY2019 initiatives

Improve ICT
literacy of older
people• Hold KDDI Smartphone and Mobile Phone Safety Classes for
elder people• Comprehension rate 85.1%, Usage rate 91.5%• 189 classes held, 3,045 participants
(cumulative 1,539 classes, 27,468 participants)

Targets

FY2019 initiatives

Improve ICT
literacy of youth• Hold KDDI Smartphone and Mobile Phone Safety Classes foryouth• Satisfied with teaching materials: 99.3%
Satisfied with lecturers: 99.1%
Will reapply: 84.3%• 4,332 classes held, approx. 790,000 participants (cumulative
total: approx. 33,000 classes, approx. 6.11 million participants)• Held Workshop-style classes for high school students: Raise DRR Literacy with Your Smartphone• Held at 19 schools with 937 participants (cumulative 40 schools with over 2,000 participants)

Total contributions(Unit: yen)

Donated to

3,085,500

Japanese Red Cross Society(3) Environmental Conservation
Targets
Biodiversity
conservation incollaboration
withstakeholders

FY2019 initiatives

Web Link
Web Link

Typhoon No.15 (Faxai)
damages in Chiba Prefecture in 2019

6,137,600

Japanese Red Cross Society

Typhoon No.15 (Faxai)
damages in Tokyo in 2019

1,638,600

Japanese Red Cross Society

Typhoon No.19 (Hagibis)
damages in 201916,232,800

Japanese Red Cross Society

COVID-19 emergency
support donation

100,000,000

Central Community Chest ofJapan

Environmental
education forchildren

Web Link

Targets

Support earlyrecovery ofdisaster areas

Related to theGreat East Japan
Earthquake

Country nameWe held a class on creating a field guide on plants
and forest wildlife at the Yokohama City
Mutsukawanishi Elementary School. (Japanese only)

Contribute to
local community
development
and regional
revitalization
Raise awarenessof manners formobile phone
use and prevent
cycling accidents

Web Link

Shimamono Lab workshops for outlying island businesses in
the Kasaoka Islands, Okayama Prefecture (Japanese only)

Web Link

Shimamono Lab workshops for outlying island businesses
in the islands of Oita Prefecture (Japanese only)

Web Link

Classes held using a VR kit to prevent smartphone
use while cycling at Sendai Shirayuri Gakuen HighSchool (Japanese only)

Web Link

Web Link

Web Link

Donation of relief funds for victims of the heavy rains
in August 2019 (Japanese only)

Web Link

Donation of relief funds for victims of Typhoon No.15(Faxai) in Chiba Prefecture in 2019 (Japanese only)

Web Link

Donation of relief funds for victims of Typhoon No.15(Faxai) in Tokyo in 2019 (Japanese only)

Web Link

Donation of relief funds for victims of Typhoon No.19(Hagibis) in 2019 (Japanese only)

Web Link

Donations to support COVID-19 measures(Japanese only)

Web Link

As supporters of project-based learning classes at Kunimi-machi, we helped local junior high school students tocreate a promotional VR video for Kunimi (Japanese only)

Web Link

As supporters of Katsurao-mura’s VR content creation, we helped comprehensive learning classes
at Katsurao Junior High School (Japanese only)

FY2019 initiatives• Held art, music, English, computer and dance classes at theVillage School (KDDI Foundation)

Environmental Conservation Activities by Employees

We held a class on creating a field guide on plants
and forest wildlife at the Urayasu City
Akemi Elementary School. (Japanese only)

FY2019 initiatives(6) Contribution Activities in Growth Regions outside Japan• Held digital skill education programs, technology internships
and sports promotion events for youths who will be the future
leaders of Myanmar (MPT)

Myanmar• Large-scale cleanup activities: Clean and Fresh to Move Forward (MPT) MPT held its third round of large-scale cleanup activities in 18 districts across Myanmar• “Clean and Sustainable Water Program” (MPT)
Prepared wells in villages that have difficulty accessing clean
domestic water to improve public hygiene• Support for COVID-19 measures (MPT)
A portion of our sales was donated to support COVID-19 relief
measures. We also gave out Topup cards to medical workers
and volunteers for free and eliminated fees for sending MPT
Money to the government and NGOs.

FY2019 initiatives

KDDI’s Shimamono Project Supports Remote Islands

KDDI Sustainability Report 2020

Targets(4) Social and Cultural Support

We support
NPOs and otherorganizations
working tosupport theenvironment andsociety.

118(5) Disaster Support

Targets

KDDI Group Results

Source of funds: KDDI’s Bridge of Hope social contribution website
KDDI matches the donations of customers and KDDI group employees.
In the case of an emergency, KDDI also makes donations.

Understood very well, wellKDDI Group Results(2) Supporting Sound Development of Youth

Unit:
Person who uses
the program

Volunteer
leave

Initiatives

Results▪ Volunteer Leave and Number of JICA Volunteers (KDDI)(1) Importance of receiving and sending appropriate informationin the event of a disaster(2) Importance of helping oneself and others in a disaster(3) Need to pay attention to information communication in
everyday life too

Understoodvery wellSocial Contribution• Used computer donations (MobiCom)
As part of KDDI’s used computer donation project, MobiCommakes donations to public schools across Mongolia and to
government facilities• Child Helpline 108 (MobiCom)
This service can be accessed for free 24 / 7 by children,
parents,teachers, social workers, and others. We hope to help
resolve issues such as child abuse with this service.
Mongolia

Classes held on preventing bicycle accidents by using VRthat recreates smartphone use while cycling at Kawasaki
City Hirama Elementary School (Japanese only)• W.A.S.H. Project (MobiCom)
In collaboration with local governments and the NGO World
Vision Mongolia, MobiCom builds clean water facilities andtoilet facilities for elementary schools.
• Support for COVID-19 measures (MobiCom)
MobiCom provided free pre-paid SIM cards to police, medical
workers and COVID-19 countermeasure experts. A part ofonline sales and sales from our distributors were donated to
medical facilities.

KDDI’s Bridge of Hope social contribution website(Japanese only)
Cambodia• Built a KDDI School (the 12th one), built English and computerclassrooms (for the 10th and 11th schools) and held musicclasses (KDDI Foundation)• Provided support to pass down the traditional Cambodian art
form of large-scale shadow theater (Sbek Thom) (KDDI Foundation)

Nepal• Held e-learning and robot programming classes (KDDI Foundation)
KDDI Sustainability Report 2020

119Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

External Recognition
A Sample of Indices That Include KDDI
Inclusion in SRI Index FTSE4Good Global Index Series
We are included in the FTSE4Good Index Series, a major global index forsocially responsible investment (SRI) (as of June 2020). The index wasdeveloped by FTSE Russell, which belongs to the London Stock
Exchange Group. It is widely used as a standard for selecting investees byinstitutional investors who focus on the social responsibility and sustainability of companies.

Inclusion in SRI Index MSCI ESG Leaders Indexes
Among global SRI indices, we are included in the MSCI ESG Leaders Indexes (as of June 2020).
This index suite was developed by a US-based company, MSCI Inc.,and selects companies with excellent environmental, social and governance (ESG) performance.

THE INCLUSION OF [ISSUER ENTITY NAME] IN ANY MSCI INDEX, AND THE USE OF MSCILOGOS,TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE ASPONSORSHIP,ENDORSEMENT OR PROMOTION OF [ISSUER ENTITY NAME] BY MSCI OR
ANY OF ITS AFFILIATES.
THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEXNAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.

Inclusion in Euronext Vigeo Eiris IndicesWorld 120
We are included in the Euronext Vigeo Eiris
Indices World 120, a representative SRI
index (as of June 2020).
This index distinguishes 120 companies
achieving the most advanced environmental,social and governance performance.

120

KDDI Sustainability Report 2020

KDDI
Inclusion in Ethibel PIONEER and Ethibel
EXCELLENCE Investment Registers
We are included in Ethibel EXCELLENCE
and investment universe Ethibel PIONEER,
both labels of Forum Ethibel, which is a Belgian association that promotes SRI. We also
continue to be included in ESI Excellence
Global.
Ethibel Investment Register is an investment
universe comprised of companies that haveearned high corporate social responsibility(CSR) performance scores according to theassociation’s diverse evaluation (as of May2020).

Inclusion in S&P / JPX Carbon EfficientIndex
We are included in the S&P / JPX Carbon
Efficient Index, which is a environmental
index jointly developed by the Japan Exchange Group, the Tokyo Stock Exchange,
and the S&P Dow Jones Index (as of June2020).

Acquired the Highest Rank in the DBJ
Environmental Ratings
The Development Bank of Japan (DBJ) developed its own environmental rating system. The investment menu confers an environmental rating after companies areevaluated on their environmental management, outstanding companies are selected,
and investment criteria are establishedbased on their score. KDDI acquired thehighest rank of A in the ratings. Furthermore,KDDI is the only company in the telecommunications industry that has earned a DBJ
Environmental Rating(as of March 2020).

Results

Recognition of Our Initiatives
in Growing Markets

KDDI Group Results

Received the Outstanding Contribution to the Asia Mobile Industry
Award at the 2019 Asia Mobile Awards
At the Asia Mobile Awards 2019, which were held in June 2019 at Asia’s
largest annual mobile industry event Mobile World Congress Shanghai,KDDI’s Chairperson Takashi Tanaka received the highest honor of Outstanding Contribution to the Asia Mobile Industry Award. This award isgiven by the GSMA to honor an individual who has made an outstanding
contribution to the development of Asia’s mobile industry. This marks thefirst time a Japanese person has won the award.

Recognized as a company in line with
Health and Productivity Management
2020 (White 500)
We were recognized by the Nippon Kenko
Kaigi for our outstanding health management initiatives that consider the health of
our employees from a management perspective and which are strategically carriedout. This led to being recognized as a Healthand Productivity Management 2020 company in the large enterprise category (White
500) (as of July 2020).

Award

Won the Award of Excellence in the HR
Management category at the HR
Technology Awards
We won the Award of Excellence in the HR
Management category at the 5th HR Technology Awards. Our initiative of using AI to
identify and support employees who show
signs of mental instability was praised as
being innovative. The AI uses deep learning
to create a list of employees showing signsof mental instability, and counseling sessions
are set up for those individuals with thecompany’s mental health counselors. Thisinitiative enables us to have a clear understanding of the workplace environment andto implement improvements at an earlystage. It also greatly contributes to providing
early support for mental instability, being
aware of the mental and physical states ofour employees and resolving workplace issues (February 2020).

Evaluation

MobiCom:
Honored as one of the Top 100
Companies of 2019

Received in recognition of comprehensively
contributing to Mongolia’s economy withsales, tax payment and capital investment

MobiCom:
Top 10 Entrepreneur Award 2019

Received in recognition of the company’sbusiness accomplishments, profit, social responsibility, employment, exports, and otherfactors

MobiCom:
Received the best player of ICTEXPO 2019 award

Recognized for our comprehensive activities
in the ICT field

MobiCom:
Received the Honorary Tax Payer
award and Best Tax Payer award

Received in recognition of regularly reportingto the local tax office and for the amount oftax paid

MobiCom:
Received the award for Corporate
Social Responsibility at the Forbes
Mongolia Awards 2019

Received in recognition of being the best
Mongolian company in the field of social responsibility and eco-friendliness

Ranked First for Overall Performance in CSR Company Ranking
We placed first for overall performance in the 14th CSR Company Ranking
announced by Toyo Keizai Inc. In this ranking, around 1,593 Japanesecompanies are evaluated based on the survey conducted in 2020 for theutilization of human resources, environmental responsibility, corporate
governance and social responsibility and finance. The top companies arerecognized as trustworthy by a wide range of stakeholders (February 2020).
Other External Assessments

Awarded Gold Rating in the PRIDE Index
for Four Consecutive Years
We received the top gold rating on the
PRIDE Index, which evaluates corporate efforts related to LGBT and other sexual minorities, for four consecutive years (as of
October 2019).
The PRIDE Index was established by a
private organization, work with Pride, withthe aim of promoting the creation of inclusive workplaces in companies.

Recognition and awards

Evaluation

Association for Resilience Japan
6th Japan Resilience Award

Award of Excellence in theBusiness and Industry category

Japan Committee for United Nations Decade on
Biodiversity (UNDB-J)
Biodiversity Action Award

Received award

National Institute on Consumer Education
Consumer Education Resources Award 2020

Award of ExcellenceKDDI Sustainability Report 2020121

Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

External Assurance
Scopes 1 and 2
FY2018 Greenhouse Gas Emissions Verification Statement

Scope 3
FY2019 Greenhouse Gas Emissions Verification Report

ISO 14001 Management System Certificate* Direct GHG emissions include those of an overseas subsidiary. Indirect GHG
emissions from consumption of purchased electricity, heat or steam are calculated using the emission factor of each electric utility operator.

122

KDDI Sustainability Report 2020

KDDI Sustainability Report 2020123Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate Profile

Corporate Profile:

KDDI CORPORATION

Date of establishment:

June 1, 1984

Main business:Telecommunications business

Head office:Garden Air Tower, 3-10-10, Iidabashi, Chiyoda-ku, Tokyo 102-8460, Japan
Makoto Takahashi:

141,852 million yen

Number of employees:

44,952 (consolidated basis)

Office Status (As of March 31, 2020)
Office:Head Office (Tokyo Prefecture)

Head branches:

Hokkaido (Hokkaido Prefecture), Tohoku (Miyagi Prefecture), Northern Kanto (Saitama Prefecture),
Southern Kanto (Kanagawa Prefecture), Chubu (Aichi Prefecture), Hokuriku (Ishikawa Prefecture),Kansai (Osaka Prefecture), Chugoku (Hiroshima Prefecture), Shikoku (Kagawa Prefecture), Kyushu (Fukuoka Prefecture)

Branches:

17 branches, 65 branch stores, 6 customer services centers, etc.

Technical centers:

11 technical centers and engineering centers, 3 technical maintenance centers, 1 transmission center

Offices outside Japan:

Geneva, Beijing, Shanghai

Web Link

KDDI issues its Sustainability Report as a means of disclosing financial
and nonfinancial information. This report is a focused summary of environmental, social, governance, and other non-financial information in PDF
format (Japanese and English).
The Sustainability Report expands on information referencing the
GRI’s Sustainability Reporting Standards, as well as information topromote greater understanding of how KDDI creates value.
We will continue making efforts to communicate with all stakeholders
and promoting our sustainability initiatives.
Please note that this report is an English translation of the Japanese
SUSTAINABILITY REPORT 2020 prepared for your reference and convenience only and without any warranty as to its accuracy.
In the event of any discrepancy, the Japanese original shall prevail.

The KDDI group comprises KDDI, 164 consolidated subsidiaries (105 in Japan, 59 overseas) and 40 equity-method affiliates (33 in Japan, 7 overseas).
The businesses of the group are classified into segments in accordance with the types of services and customer attributes. The principal businesses of eachsegment are presented below.

Business Services:

Communication services in Japan and overseas (mobile and fixed telecommunications) and life design services(commerce, finance, energy, entertainment, education etc.) for individuals▪ Operating Revenue Composition by Segment (FY2019):5,237,221 million yen

Operating income:

1,025,237 million yen

Profit for the period attributable :to owners of the parent

639,767 million yen

Individual Investors
Customers

Financial Highlights* Consolidated: based on International Financial Reporting Standards (IFRS). Non-consolidated:based on Japanese GAAP.

Publication Date
September 2020 (Next publication: September 2021; Previous publication: September 2019)

Integrated Report

Shareholder
Communication

Experts
Institutional Investors

Business
16.8%

Sustainability Report(This Report)

Sustainability Website* See the financial summary data in investor relations for details.

Web Link

Scope of Report
Although we report the activities of the KDDI Group (KDDI and its 164
subsidiaries), this report focuses on KDDI only since the ratio of theGroup’s consolidated sales is approximately 1.29 times KDDI’s non-consolidated sales.*IR Website

KDDI Consolidated Performance*
Operating revenue

Period Covered
FY2019 (April 1, 2019 to March 31, 2020). Some of the included information pertains to activities prior to March 2019 and after April 2020.

Financial Information

Communication services in Japan and overseas (mobile and fixed telecommunications) and ICT solutions and data
center services for companies

FY2019

Stakeholder Engagement

Guidelines Referenced• GRI (Global Reporting Initiative) Sustainability Reporting Standards• SASB (Sustainability Accounting Standards Board) (Telecommunications)• IIRC (International Integrated Reporting Council)• ISO 26000: 2010 (Guidance on Social Responsibility)• JISZ 26000: 2012 (Guidance on Social Responsibility) Japanese Industrial Standards• Japan’s Ministry of the Environment, 2018 Environmental Reporting
Guidelines• Japan’s Ministry of the Environment, 2005 Environmental Reporting
Guidelines• J apan’s Ministry of Economy, Trade and Industry, Guidance forCollaborative Value Creation

Principal Businesses (As of March 31, 2020):

Management Framework

Appendix Table

Major KDDI group companies

Personal Services

Materiality

Disclosure of Sustainability-related Information

Company name

CapitalDisclosure Policy

Feature Article: KDDI Sustainable Action

Disclosure Policy

Corporate Profile (As of March 31, 2020)

President, KDDI CORPORATION :KDDI’s Commitment to Sustainability

Personal
83.2%

Non-Financial Information

In 2013 we published our last print edition of the report. Out of consideration
for the environment, we now publish the report exclusively online. It can be
downloaded from our website as a PDF file.

External Assurance
Note: From fiscal 2019, we have changed the four original segments of Personal Services, Life
Design Services, Business Services and Global Services into the two new segments of
Personal Services for individual consumers and Business Services for corporate clients.

124

KDDI Sustainability Report 2020

To ensure reliability, environmental data for Scope 1 and 2 has received
independent third party assurance by Lloyd’s Register Quality Assurance
Limited. Environmental data for Scope 3 has been verified by WASEDA
University, an independent third-party.

Inquiries
KDDI Corporation
Sustainability Department, General Administration Division
E-mail: csr@kddi.com
GARDEN AIR TOWER, 3-10-10, Iidabashi, Chiyoda-ku, Tokyo 102-8460,
Japan

KDDI Sustainability Report 2020

125Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

Appendix Table: Comparative Table with GRI Standards
KDDI prepared this report by referencing the GRI Sustainability ReportingStandards.
GRI 102: General Disclosures
Item

Reference Page

1. Organizational profile

6. Reporting PracticeGRI 303: Water and Effluents 2018

Entities included in the consolidated financial statements

125

303-1

Interactions with water as a shared resource-

102-46

Defining report content and topic boundaries

125

303-2

Management of water discharge-related impacts-

102-47

List of material topics

31, 34-35

303-3

Water withdrawal

92102-48

Restatements of information

N/A

303-4

Water discharge

92

102-49Changes in reporting

N/A

303-5

Water consumption

92

102-1

Name of the organization

124

102-50

Reporting period

125

102-2

Activities, brands, products, and services

124

102-51

Date of most recent report

125

102-3

Location of headquarters

124

102-52

Reporting cycle

125

Contact point for questions regarding the report

125

102-4

Location of operations

124

102-53

102-5

Ownership and legal form

124

102-54Claims of reporting in accordance with the GRI Standards 125

102-6

Markets served

124102-55

GRI content index

126-127

102-7

Scale of the organization

61, 124102-56External Assurance

122-123

102-8

Information on employees and other workers

61, 124

GRI 103: Management Approach

102-9

Supply Chain

6, 79-81

102-10Significant changes to the organization and its supply chain N/A

GRI 103: Management Approach102-11

Precautionary principle or approach

106-109

103-1

Explanation of the material topic and its boundary

31-32

102-12External initiatives

116

102-13

Membership of associations

38, 74, 116, 118

103-2

The management approach and its components

36, 44, 48, 56, 72,
82, 106-109

103-3

Evaluation of the management approach

34-35

2. Strategy
102-14

Statement from senior decision-maker

2-3, 30

102-15Key impacts, risks, and opportunities

36, 44, 48, 56, 72,
82, 106-109

3. Ethics and Integrity

Item

Values, principles, standards, and norms of behavior

0, 4-6102-17

Mechanisms for advice and concerns about ethics

76-77

4. Governance

Reference Page

200 series (Economic)
Item

Reference Page

GRI 201: Economic Performance
201-1

102-16

Direct economic value generated and distributed

61, 71, 88,
117-119, 124

GRI 304: Biodiversity 2016

304-2

406-1

304-3

Habitats protected or restored

96-97

GRI 407: Freedom of Association and Collective Bargaining 2016

304-4

IUCN Red List species and national conservation list species with habitats in areas affected by operations

N/A

407-1

305-2

Energy indirect (Scope 2) GHG emissions

89-91

305-3

Other indirect (Scope 3) GHG emissions (Scope 3)

89-91

GRI 409: Forced or Compulsory Labor 2016305-4

GHG emissions intensity

–

409-1

305-5

Reduction of GHG emissions

34-35, 89-92

305-6

Emissions of ozone-depleting substances (ODS)–

GRI 410: Security Practices 2016

305-7

Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions

–

410-1

102-21

Consulting stakeholders on economic, environmental,
and social topics

7, 114-116

102-22Composition of the highest governance body and its
committees

98-101, 104-105

102-23Chair of the highest governance body101102-24

Nominating and selecting the highest governance body

99-101, 104-105

102-25

Conflicts of interest

99-101, 103

102-26

Role of highest governance body in setting purpose, values,
2-3, 6-7, 30, 98
and strategy

102-27

Collective knowledge of highest governance body

2-3, 6, 30

GRI 205: Anti-corruption

102-28

Evaluating the highest governance body’s performance

7, 34-35, 99

205-1

Operations assessed for risks related to corruption

76-78

102-29Identifying and managing economic, environmental, andsocial impacts

7, 32, 114-116

205-2

Communication and training about anti-corruption policies
and procedures

76-78

102-30Effectiveness of risk management processes

106-107

205-3

Confirmed incidents of corruption and actions taken

77-78

102-31

Review of economic, environmental, and social topics

7, 98-99

GRI 206: Anti-competitive Behavior

102-32Highest governance body’s role in sustainability reporting

6-7, 98

102-33

Communicating critical concerns

98-99

102-34Nature and total number of critical concerns

76-77

102-35

Remuneration policies

102102-36

Process for determining remuneration

102-10362

202-2

Proportion of senior management hired from the local
community

Water discharge by quality and destination

–

306-2

Waste by type and disposal method

86, 89, 92

61

GRI 203: Indirect Economic Impacts
203-1

Infrastructure investments and services supported

36-37, 40-43,
117-119203-2

Significant indirect economic impacts

N/A

GRI 204: Procurement Practices
204-1

206-1

Proportion of spending on local suppliers

GRI 307: Environmental Compliance 2016
86 (N/A)GRI 308: Supplier Environmental Assessment 2016

300 Series (Environmental)
Reference Page

GRI 301: Materials 2016

102-37

Stakeholders’ involvement in remuneration

99

301-1

Materials used by weight or volume-102-38Annual total compensation ratio

71, 101-102

301-2

Recycled input materials used

88, 95102-39Percentage increase in annual total compensation ratio

-

301-3

Reclaimed products and their packaging materials

88, 95

GRI 302: Energy 2016

102-40

List of stakeholder groups

114-115

302-1

Energy consumption within the organization

88-92

102-41

Collective bargaining agreements

70

302-2

Energy consumption outside of the organization

90-91

Incidents of violations involving rights of indigenous peoples

N/A

GRI 412: Human Rights Assessment 2016
412-1

Operations that have been subject to human rights
reviews or impact assessments

74

412-2

Employee training on human rights policies or procedures

6, 34-35, 73-77

412-3

Significant investment agreements and contracts that
include human rights clauses or that underwent humanrights screening

N/A

GRI 413: Local Communities 2016413-1

Operations with local community engagement, impact
assessments, and development programs

97, 117-119

308-2

Negative environmental impacts in the supply chain andactions taken

79-80

413-2

Operations with significant actual and potential negative
impacts on local communities

N/A

400 Series (Social)

GRI 414: Supplier Social Assessment 2016
Reference Page

414-1

New suppliers that were screened using social criteria

79-81

414-2

Negative social impacts in the supply chain and actions taken

79-81

401-1

New employee hires and employee turnover

57, 61

401-2

Benefits provided to full-time employees that are notprovided to temporary or part-time employees

65-66, 70-71

415-1

401-3

Parental leave

68

GRI 416: Customer Health and Safety 2016

GRI 402: Labor / Management Relations 2016
402-1

Minimum notice periods regarding operational changes

GRI 415: Public Policy 2016

GRI 403: Occupational Health and Safety 2018403-1

Occupational health and safety management system

62-63

403-2

Hazard identification, risk assessment, and incident
investigation

63, 71

403-3

Occupational health services

62-65

403-4

Political contributions

77

416-1

Assessment of the health and safety impacts of productand service categories

53-55

416-2

Incidents of non-compliance concerning the health andsafety impacts of products and services

N/A

70

GRI 417: Marketing and Labeling 2016
417-1

Requirements for product and service information andlabeling

53, 95Worker participation, consultation, and communication on
63-65
occupational health and safety

417-2

Incidents of non-compliance concerning product andservice information and labeling

N/A

403-5

Worker training on occupational health and safety

63-64

417-3

Incidents of non-compliance concerning marketing
communications

112 (N/A)

403-6

Promotion of worker health

64-65

403-7

Prevention and mitigation of occupational health andsafety impacts directly linked by business relationships

63-64

403-8

Workers covered by an occupational health and safety
management system

63-64

Identifying and selecting stakeholders

114-115

302-3

Energy intensity

92

102-43

Approach to stakeholder engagement

114-119

302-4

Reduction of energy consumption

88, 92403-9Work-related injuries

71

102-44

Key topics and concerns raised

32, 34-35, 114-115

302-5

Reductions in energy requirements of products and services

92403-10Work-related ill health

64-65

KDDI Sustainability Report 2020––

102-42

126

Security personnel trained in human rights policies orprocedures

New suppliers that were screened using environmental
criteria

GRI 401: Employment 2016

Legal actions for anti-competitive behavior, anti-trust, and77
monopoly practices

Operations and suppliers at significant risk for incidents of
N/Aforced or compulsory labor

308-1

Item

-

Item

Non-compliance with environmental laws and regulations

408-1

411-1

306-1

307-1

70, 79-81

GRI 411: Rights of Indigenous Peoples 2016

GRI 306: Effluents and Waste 2016

Water bodies affected by water discharges and / or runoff –202-1

34, 73-77

Operations and suppliers at significant risk for incidents ofN/Achild labor

89-91

306-5

7, 40, 45, 62, 73, 74,
76, 85, 98-99, 106

Operations and suppliers in which the right to freedom of
association and collective bargaining may be at risk

Direct (Scope 1) GHG emissions

86

Executive-level responsibility for economic, environmental,
and social topics

Incidents of discrimination and corrective actions taken

305-1

86 (N/A)

102-20

GRI 406: Non-discrimination 2016

GRI 408: Child Labor 2016

GRI 305: Emissions 2016

Transport of hazardous waste

Ratios of standard entry level wage by gender comparedto local minimum wage

GRI 405: Diversity and Equal Opportunity 2016

Significant impacts of activities, products, and services on
N/Abiodiversity

Significant spills

GRI 202: Market Presence

60

–

306-4

7,102-103, 106

Percentage of employees receiving regular performanceand career development reviews

304-1

306-3

Delegating authority

404-3

59, 61, 73-75, 101

Financial assistance received from government

102-1956-59, 70

Ratio of basic salary and remuneration of women to men

Defined benefit plan obligations and other retirement plans 70

Governance structure

404-2

Diversity of governance bodies and employees

201-4

102-1857

Programs for upgrading employee skills and transition
assistance programs

405-2

201-3

N/A

Average hours of training per year per employee

405-1

Financial implications and other risks and opportunities
due to climate change

82-83

404-1

Operational sites owned, leased, managed in, or adjacentto, protected areas and areas of high biodiversity value
N/A
outside protected areas

201-2

7, 40, 45, 62, 73-74,
76-77, 85, 98-105, 106

5. Stakeholder Engagement

GRI 404: Training and Education 2016

102-45

GRI 418: Customer Privacy 2016
418-1

Substantiated complaints concerning breaches ofcustomer privacy and losses of customer data

34 (N/A)GRI 419: Socioeconomic Compliance 2016
419-1

Non-compliance with laws and regulations in the socialand economic area

N/A

KDDI Sustainability Report 2020127

Top Message

Stakeholder Engagement

Community Involvement and Development

External Recognition

External Assurance

Corporate ProfileKDDI’s Commitment to Sustainability

Disclosure Policy

Feature Article: KDDI Sustainable Action

Materiality

Management Framework

Stakeholder Engagement

Appendix Table

Appendix Table: Sustainability Accounting Standards Board (SASB) Comparative Table
KDDI references the sustainability account standards for telecommunication services industry designated by Sustainability Accounting Standards Board(SASB).
Table 1. Sustainability Disclosure Topics & Accounting Metrics
Topic

SASB CodeEnvironmental Footprint of
Operations

TC-TL-130a.1

Table 2. Activity Metrics

Accounting·Metric(1) Total energy consumed(2) Percentage grid electricity(3) Percentage renewable

Destination of Disclosure

Environmental Performance

SASB CodeP.88 - 92

Cyber security and privacy protection

Destination of Disclosure

TC-TL-000.A

Number of wireless subscribers

Web Link

TC-TL-000.B

Number of wireline subscribers

Not disclosed

TC-TL-000.C

Number of broadband subscribers

Web Link

TC-TL-000.D

Network traffic

Not disclosed

Major Operational Data

P.44 - 47

TC-TL-220a.1

Description of policies and practices relating to behavioral
advertising and customer privacy

TC-TL-220a.2

Number of customers whose information is used for secondary
purposes

Not disclosed

TC-TL-220a.3

Total amount of monetary losses as a result of legal proceedings
associated with customer privacy

Not disclosed

TC-TL-220a.4(1) N umber of law enforcement requests for customer information(2) Number of customers whose information was requested(3) Percentage resulting in disclosure

Not disclosed

TC-TL-230a.1(1) Number of data breaches(2) Percentage involving personally identifiable information (PII)(3) Number of customers affected(1) FY2019 Material KPI Results(2) and (3) are not disclosed

TC-TL-230a.2

Description of approach to identifying and addressing data security
risks, including use of third-party cybersecurity standards

Cyber security and privacy protection P.44 - 47
Innovation management P.50, 52
Risk management P.106 - 109
Participation in external initiatives P.116

TC-TL-440a.1(1) Materials recovered through take back programs, percentageof recovered materials that were (2) reused, (3) recycled, and (4)landfilled(1) Promotion of mobile phone recycling(2) through (4) are not disclosed

TC-TL-520a.1

Total amount of monetary losses as a result of legal proceedings
associated with anticompetitive behavior regulations

Not disclosed

TC-TL-520a.2

Average actual sustained download speed of(1) owned and commercially-associated content and(2) non-associated content

TC-TL-520a.3

Description of risks and opportunities associated with net neutrality,
paid peering, zero rating, and related practices

Cyber security and privacy protection P.44
Fulfilled life brought through ICTs P.48
Respect for human rights and fairness in business
Risk management P.108

Managing Systemic Risks

TC-TL-550a.1(1) S ystem average interruption frequency and(2)customer average interruption duration

Frequency and Duration of Network Interruption

P.37

Technology Disruptions

TC-TL-550a.2

Discussion of systems to provide unimpeded service during service
interruptions

Network Quality Management and Improvement
Disaster Preparedness P.40 - 41

P.37

Web Link

Accounting·MetricPrivacy Policy

Major Operational Data

Data Privacy

P.34

Data Security

Product End-of-life
Management

Competitive Behavior &Open Internet

128KDDI Sustainability Report 2020

Web Link

P.95

Definition of measured value of operating
speed (Japanese only)

P.72

KDDI Sustainability Report 2020129