CSR

We lead the world with specialty acrylates

Osaka Organic Chemical Industry Ltd.

REPORT

2022

Never seen but always near.
OSAKA
ORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALOSAKAORGANICCHEMICALCSR REPORT 2022

History and Strengths ofValue Creation

OOC Group’s Management
Philosophy System andFounder’s Vision
Founder’s
Principles(Corporate
Philosophy)

Management

Contents

Corporate Philosophy
The Company and its employees form a single entity that works together
and shares a single destiny. The Company’s prosperity rests on the effortsof the employees; the happiness of the employees flows from theprosperity of the Company.

Medium- andLong-term Plans

Employees

Clients

Shareholders
Investors

Promoting Sustainable
Management

G Governance

E Environment

S Society03 History and Strengths of Value Creation

G Governance05 Dialogue

26 Corporate Governance
30 Risk Management

We will strive to foster a corporate culture that takes
on new challenges as well as build a rewarding
work organization for a new stage of growth.

Third-party Opinions

E Environment
32
33
34
35

Management Philosophy

S Society36 Relationship with Employees

Shu Yamaguchi

Masayuki Ando

Leibnitz Inc.

CEO of OOC

Special Feature: OOC’s Strengths

Providing value to the global market as a corporate leader in specialty
acrylates.

09 OYPM Initiatives: The Cleanest Plant in Japan
11 Advanced Semiconductor Materials
13 Never Seen but Always Near.

OOC has always been an R&D-focused organization. The evolution into
our present form began in 1941, when founder Tatsuo Shizume
succeeded in domestic production of Canada balsam adhesive used
for optical lenses. His aim was to create a company that would be
admired worldwide. It was an aim he pursued through a lifelong
dedication to creating outstanding chemicals of benefit to consumers
and the world at large. Passion was everything to him. He felt that
outstanding results could arise from the pure application of effort. It
was this conviction that drove him to work on bringing value to theworld, as he pursued his vision and love of organic chemistry. We willcontinue to pursue the founder’s vision while striving to create newvalue by looking ahead to the future.

Initiatives to Address Climate Change Risks
Environmental Initiatives
Initiatives to Build a Decarbonized Society
Initiatives to Reduce Environmental Impact▶Workforce Recruiting and Training▶Creating a Workplace Where Diverse

Management Vision

Founder’s Vision

Communities

Special Feature:
OOC’s Strengths

The Company’s basic policies will always reject the errors of bias andself-righteousness. They will improve individual character through the
integrity and unflagging efforts of each individual along with their mutual
trust, assistance and devotion. They will serve and benefit the community
through superior production activities.

We will place the highest value on each person’s individuality and willcontribute to the development of society together with our clients byproviding materials with unique functions.

Management Vision

Top Message

Promoting Sustainable Management
15 The Process of Building a Sustainable Society
17 ESG-conscious Management to Achieve theLong-term Business Plan
19 Initiatives for Materiality
23 Business Domains of OOC Group

People Can Play an Active Role
▶Respecting Human Rights▶Promoting Health Management▶Occupational Health and Safety

43 Relationship with the Local Community▶Business Sites and Topics

45 Stakeholder Engagement
46 Third-party Opinions

Childrenof the future

Suppliers

Editorial stance and aim of this report
The OOC Group believes that putting ourManagement Philosophy into practice means
nothing less than engaging in CSR-oriented
management. Guided by this principle, we areaiming to help promote sustainability by using ourbusiness activities to solve issues of public concern.
This report has been created to present the Group’s
CSR-oriented management and provide a tool for
dialogue with stakeholders. It discloses information
about the activities that we consider most important.

01

Organizations covered by this report
This report covers initiatives carried out by
Osaka Organic Chemical Industry Ltd. andShinko Organic Chemical Industry Ltd. (adomestic consolidated OOC subsidiary).
Other information is for the entire OOC
Group, but includes some information on
Osaka Organic Chemical Industry Ltd.

Periods covered by this report
The environmental protection data
covers the period from April 2021 toMarch 2022. The activities data andfinancial data covers OOC’s fiscal year
from December 2020 to November
2021. The report information also
includes some activities from before orafter these periods.

Main reference guidelines
Environmental Reporting Guidelines 2018, Ministry of the Environment
ISO 26000:2010 (Guidance on social responsibility)
SDG Compass
GRI Sustainability Reporting Standards

Separate Roles for Website and Booklet
Business and Financial Information

Sustainability Information

CSR Report 2022
This report summarizes the OOC Group’s activities and communicates themto stakeholders in an easy-to-understand manner.
* Only some financial information is included.

WebsiteShareholder andInvestor Information

Financial Results
Annual Securities
ReportSustainability
This section introduces our sustainability activities fromenvironmental, social, and governance perspectives.
Comprehensive coverage of more detailed information.

Release date: August 2022

02

CSR REPORT 2022

History and Strengths ofValue Creation

Special Feature:
OOC’s Strengths

Top Message

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

History and Strengths of Value Creation
Net sales in fiscal 2021: 35.0 billion yen

Osaka Organic Chemical Industry (OOC) was founded on a vision of using organic
chemistry to benefit consumers and the world at large.
Today, we continue to honor our founder’s vision as we work to create new value.
Acrylic acids ⇒Polymerization
prevention technology

1941
Osaka Yuki Kagaku Kogyosho

Establishment

1946
Osaka Organic Chemical Industry Ltd.

Establishment

Division intobusiness segments
Commercializing
specialty acrylic acid
estersRaw materials forpharmaceuticalintermediates

Full-scale release in LCD
manufacturing sector

LCD photospacers

Acetic esters ⇒Esterification
technology

1950

1960

Canada balsam and cedar oil⇒Distillation/refining
technology

1970
Specialty methacrylic esters⇒Application to esterified
products

1980

1990

Raw materials for products
such as photo-curable paints
and inks: Viscoat Series

2000

2010

LSI resist products
Application to LSI
manufacturing sector

LCD resist products■ Consolidated net sales

Strength

1 Ability to respond

We possess a large numberof products with high market
share in the world

Strength

2

Technologicalstrength

Technology with uniquecompetitive advantage

Strength3

Supporting
infrastructure

Unique strengths of the OOC
Group that no other company
can imitate
03

Wide variety/Small quantities
In order to respond to each and every detailed
request from our customers, we have a flexible
production system that can handle small amounts
of a wide variety of products, and we have a large
number of product groups that have the top sharein the world in niche business areas.

Top-level production technology in the industry
OOC is the industry leader in acrylic acid ester
production technology (polymerization
prevention and control technology). With boldideas and a passion for manufacturing, we areconstantly improving our technology anddeveloping new technologies and products.

The cleanest plant in JapanAll employees participate in 5S initiatives in small
groups, and these initiatives have been establishedas business improvement initiatives. We aim to makeour plant the cleanest in Japan, and we are working
on safety, quality improvement, and environmental
conservation as our priority issues every day.

Automotive paints/adhesives and raw materials for UV inkjets
4-HBA

2020

Industrialization using transesterification method (such as THFA; a world-first)
Photo-curable acrylic acid esters■ Chemical products

Acrylic resin for cosmetics■ Electronics materials

Materials for highly
functionalized displays■ Specialty chemicals

ArF resist monomer, a raw material
for advanced semiconductors

IBXA
No.

1

No.

1

No.

share inJapan

globalmarketshare

1

globalmarket
share

1953

1968

1992

1995

2020

Mass production of acrylicacid by creating
polymerization prevention
technology

Commercializing specialty
acrylic acid esters

Business development throughpolymer design technology(LCD)

Business development using
ultra-high-purity technology(Semiconductor resist materials)

Using bulk polymerization
technology to bring new products
to the market(Functional acrylic elastomers)

First inJapan

Establishment

Development

The world’s

Specialof coreof technology

most advanced

polymerization

technologies

applications

technology

technology

Human resource development
through OYPM initiatives(Improving problem-solving skills)
Continuity is power, andthe OYPM initiatives
that have been steadily
continued for over 25
years are still evolving.

High quality control technology
We respond with sincerity to
the need for continuation ofbusiness as usual and theincreasing individualization,
sophistication, and complexityof customer requirements.

Integrated support capability from
R&D to industrialization
 Outstanding ability to makeproposals and solve customer
issues Provision of service solutions
based on research andmanufacturing technologies
 Functional representation ofcustomer/client operations

04

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Dialogue

We will strive to foster a corporate culture that takes on new
challenges as well as build a rewarding work organization for a
new stage of growth.
We invited Mr. Shu Yamaguchi, who has published numerous works on corporate management, to speak with CEO Andoand offer suggestions for the future growth of the OOC Group.

05

Masayuki Ando

Shu Yamaguchi

CEO of OOC

Leibnitz Inc.

Fostering a corporate culture that relentlessly
takes on challenges as an organization isessential for sustainable growth
Ando:

Thank you for coming from so far today, Mr.
Yamaguchi.
Despite the severe business environment under
COVID-19, the OOC Group’s results have beensolid and its businesses continue to grow. However,
it is also true that there are issues that need to beaddressed in order to achieve sustainable growthover the medium to long term. Particular issues
include fostering a corporate culture that takes on
the challenge of new growth and compliance anddiversity as the organization expands. Over the past
few years, in the course of publishing our CSR
Report, we have identified a variety of issues andimplemented specific initiatives to resolve them. In
light of this, we would be grateful if you, who havepublished numerous works on value creation in the
new age, could offer some advice on the OOC
Group’s sustainability.
The first question I would like to ask is what are thevalues that an organization should share in fulfilling
its responsibilities to society as a corporation,
including compliance. I first became interested inyour views when I read your book, Sekai no elite
wa naze biishiki wo kitaerunoka? (Why do global
elites study aesthetics?). As a manager, I am awareof the problem that as an organization grows,
issues such as compliance are inevitable. I was
thinking that strict rules would not be the solution,
but rather that we needed to have a set of major
values that we should share as an organization. It
was at that time that I was exposed to the keyword“aesthetics,” which led me to a new perspective.
Yamaguchi: Logistic curves are often used to explain the
proliferation of organisms and economic
development. In the process of things growing, it isan S-shaped curve, so to speak, which starts
slowly and gradually accelerates, but gradually
decreases when a certain stage is reached. If weapply this to the growth of a company, allemployees work hard to expand the business, butwhen it becomes consistently profitable, they tend
to continue their day-to-day operations to maintainthat status. While it is important to ensure that
day-to-day operations continue, it is also easy togradually lose the will to take on new challenges.
This can make companies less capable ofresponding to changing times.
The American economist Schumpeter used theterm “creative destruction” to describe the roots ofeconomic growth. In order to bring about new
growth in changing times, we need to increase ourcompetitiveness through creative destruction andmove into fields of high productivity. These
challenges are not easy, but if we don’t take themon as an organization, it will be difficult to move tothe next stage of growth. If you compare it torunning a marathon or climbing a mountain, if you
take a break because you’re having a hard time,
the hardest part will be when you start again. The
same applies to taking on challenges, and I
believe that fostering a corporate culture thatallows you to continue steadily as an organization
is essential for sustainable growth.

Profile of Shu Yamaguchi
Born in Tokyo in 1970.
Independent researcher,author, and public speaker.
Representative of Leibnitz Inc.
Graduated with a BA in
Philosophy and MFA from Keio
University. He has been
involved in strategy
development at Dentsu, Boston
Consulting Group (BCG), andelsewhere. His book, “Why do
global elites study aesthetics?”
won the HR Awards 2018 BestBook Award in the Book
category and numerous otheraccolades. He is also theauthor of many other books.

Ando:

We are striving to build a corporate culture thattakes on the challenges of new growth, but what
do you think is necessary to foster such a
corporate culture?
Yamaguchi: If you just tell your employees to keep running all
the time, they will just find it hard. I believe that theideal way to maintain motivation is to build anorganization where each individual can work on
what he or she wants to challenge themselves.
Even if you force them to take on a challenge fromthe top down, it is unlikely to lead to positive
results. It is more important to be an organization
where people who want to take on challenges
voluntarily work on them.
Ando:
You are right. In a nutshell, OOC wants to be anorganization where each and every one of us canwork on things that we find interesting in order todevelop a workforce who will take on thechallenges of the future. This is especially
important in R&D.
One of the things that I think has changed
dramatically in the world is that now that social
networking services are so widespread aroundthe world, an individual’s efforts are valued, andsomeone can even become a worldwide
phenomenon instantly. Although we may not beable to equate individual initiatives through social
networking with corporate initiatives, I believe thatthe starting point of innovation lies in what
individuals find interesting and their aspirations. At
OOC, we value the ideas of individuals and wantto encourage them to take on new challenges anduse them as the starting point for new businesses.

We need to further raise awareness of theneed to take on challenges that othercompanies shy away from
Yamaguchi: In terms of the current state of Japanese society,corporate leaders are aging against the backdropof an aging society with a declining birthrate. In
the past, many of the people who built the newJapan during the Meiji Restoration were in their
20s. In the economic recovery after the Pacific06

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Dialogue

Ando:

Ando:

War, it was the younger generation who worked
hard while people in their 50s were ostracizedfrom public office across the board. However, I
must say that in today’s Japan, there is less andless room for the younger generation to play anactive role. I believe that it is difficult to motivate
people to take on challenges in this situation.
How to motivate young people is a major issue forus as well. In the world of chemistry, materials havetremendous potential, and so I believe it is the job ofmanagement to create an environment within thecompany that allows young people to takeadvantage of this potential and experience successfrom an early age.
Also, we are going to do what large companies
can’t do. For us at the OOC Group, it is notinteresting to simply follow what others are doing.
We believe that our reason for being must be totake on more serious challenges. I want the
younger generation to challenge themselves andto be aware that they are leading the way.
However, even if an idea is interesting, it may not be
viable as a business if it goes in the wrong direction.
In today’s world, it is essential to be committed tosolving problems that society demands, such as theenvironment. Currently, OOC’s development projects
are largely energy-related. For example, we areworking on materials that convert things into
electrical energy and materials that enable theconversion of matter through the power of chemistry.
We will further accelerate our efforts in these areas.

Focusing on maintaining management stability andfostering a corporate culture that tolerates failure
Yamaguchi: When it comes to taking on new challenges, I
think it’s important for each individual to be
self-motivated and to gain high quality experience.
This means that you may have situations where
you have worked on a certain hypothesis, but are
faced with unexpected results. At first glance,
organizations tend to think that it is better toachieve the expected results, but this is not thecase if you desire innovation. Unfortunately,07

however, in many companies, people who deliver
the expected results are often regarded as betterat their jobs. Of course, these people areimportant for ensuring short-term performance,
but if the entire organization operates inconformity, growth may stop before you know it. To
avoid this situation, it is essential to have
unexpected results, that is, an organization thattolerates failure and appreciates those who fail.
In this regard, from the perspective of shareholder
returns, which emphasize stable dividends, it isalso problematic to emphasize only challenges,
because people are more conscious of earning
stable money as it is now rather than forcing thecompany to take on challenges and fail. However,remaining stability-oriented will not lead tosustainable growth over the medium to long term.
This is where your sense of balance as amanager is tested with regard to stability andchallenges.
Certainly, fostering a corporate culture that tolerates
failure is something that requires determination on
the part of management, but I think it is importantto create an organization that tolerates failure sothat each and every employee can take on thechallenge of doing something interesting.
Currently, we are working on various initiatives suchas launching cutting-edge projects within thecompany and establishing organizations such as
the Takumi no Kai (Craftsman Association). Also, I
believe that we need an ideology that unites us in
the company in order to take on interesting andnew challenges. Simply put, we are “creating abrighter future through the power of chemistry.” Wewant to create an organization that shares thisphilosophy.
Also, while it’s important to experience failure, if you
keep failing, you will lose your motivation. And so,
we also believe that young employees need toexperience success, even if it is small, to build theirconfidence. This will lead them to want to challengethemselves to achieve even higher goals.

Aiming to be an organization that supports theefforts of each and every employee and allows eachindividual to demonstrate his or her individuality
Yamaguchi: In addition to fostering a corporate culture thatencourages employees to take on challenges, it isalso important to have a support system that
promotes individual growth as an organization.
Support for employees includes work support,
career support, and emotional support, and I
believe it is important to balance the three in our
relationships with our supervisors and colleagues.
Organizations that develop human resources
have in common that they share these supports
within the organization and have both a high levelof both rigor and sense of security in their work.
Ando:
Our goal is to be a company that makes possible
technologies, materials, and manufacturing that
others cannot imitate. Moreover, unlike large
corporations, we would like to pursue uniquechemical technologies that only we can create
because of our company’s size.
In that sense, as you say, we want to create anorganization in which each employee candemonstrate his or her individuality through asystem that supports individual initiatives. It is anorganization where diverse personalities cancome together and express their opinions freely
and openly. Fortunately, OOC is still a 400-personorganization, and the company and its employees
have been working together as a community ofdestiny, so to speak. I believe that this is thereason why communication is so smooth andindividual opinions have so much influence.
After all, high aspirations are essential if you want
to try something new. We want to be a company
where middle managers, who are at the core of
our operations, can work with high aspirations. I
believe that this, in turn, will encourage theyounger generation to carry on our highaspirations.

Ethics, justice, aesthetics, and dignity will
become increasingly important in the future
Yamaguchi: In addition to the importance of inciting a sense ofchallenge within the company, as the OOC Groupgrows in the years ahead, the way employees
think, including the aesthetics that you mentioned
at the beginning, should become increasingly
important. I have conducted interviews about
good and bad bosses in the course of holding
workshops at numerous companies. What struck
me in the course of these interviews is that a badboss is, in essence, someone who is not looked
up to by his or her subordinates. For example, heor she may cheat a bit on an expense request.
However, it is not uncommon for the person to be
unaware of his or her action. It’s like, “Just a little
is OK.” However, these people can become theseeds of noncompliance by being able to do theirjob, and before long, they can rise to the top of theorganization. In criminology, there is a concept
called the broken window theory, which states that
if even one window in a building is left broken, it
will cause a deterioration in public safety. The
same idea could also be applied to a corporate
organization.
Ando:
The points you raised are important for the OOC
Group as we pursue sustainability going forward.
While we have always emphasized theimportance of thorough compliance, we believethat a high level of compliance cannot be
achieved by an organization that merely sets rules
and tells people to follow them. We believe that
ethics, justice, aesthetics, and dignity as humanbeings will become increasingly important in the
future. Among them is the Corporate Philosophy,
the starting point for the company’s foundation, as
something to turn to when something goes wrong.
As a company, it is our mission to make a profit,
but we hope to be a corporate group that is able
to conduct its business fairly and honestly andgenerate appropriate profits. Thank you verymuch for this valuable talk today.

08

CSR REPORT 2022

History and Strengths ofValue Creation

Special Feature:
OOC’s Strengths

Top Message

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

OOC’s Strengths
SpecialFeatureOYPM Initiatives: The Cleanest Plant in Japan

Osaka Yuki Productive Maintenance (OYPM) initiatives began in December 1993 as
production and maintenance initiatives unique to OOC. These are production andmaintenance initiatives in which all employees throughout the company participate, with
instruction and training, equipment maintenance, and quality control as the three core
initiatives, and they are continued as comprehensive initiatives ranging from using 5S fordeveloping original and innovative ideas up to quality control. At OOC, we are aiming tobe the cleanest plant in Japan under our basic policy of “enhancing our facilities andpeople based on OYPM to create a company capable of surviving in any environment.”

OYPM initiatives
Implementation of
improvements

Functionality-oriented Workplace beautification Education and instruction

Voluntary maintenance

Workforce training

Proposal
initiatives
Elimination of waste and loss

Corrective action

Elimination of faults
Compliance with rules

Ensuring safety and healthPrevention of work errors

Zero accident
initiatives

Written work procedures

Elimination of problems and complaints

Improved work efficiency
Environmental conservation/
Energy improvement

Ensuring confidence

Realizing a new 3K workplace:
Clean, comfortable, energetic

Better business results

Improvements in living standards

In FY2022, 42 groups are active as determined by the Implementation
Committee. The person in charge of the department where the groupbelongs (“PM department head” below) provides advice and guidance tothe group for achieving its goals. The main initiatives are individual
improvement (operational improvement) and voluntary maintenance ((1)
Human resource development, (2) Comprehensive 5S, and (3) Equipment
maintenance). In individual improvement (operational improvement), we
work on two topics based on priority measures and medium- andlong-term plans, designating the workplace where we work as a groupmanaged area and striving to implement voluntary maintenanceimprovements.

Harmony with the community

Contributions to the world

Dynamic company
Dynamic OOC workforce

Priority Items(1) We will develop dynamic human resources (assets) by enhancing
creativity, skills, and dignity through the participation of all employees.
(2) Thoroughly implement 5S.
(3) Thoroughly eliminate waste and loss.
(4) We aim to make facilities safe through voluntary
maintenance.
(5) Realize the New 3K Workplace. (New 3K: Kirei (Clean),
Kaiteki (Comfortable), Kakki (Energetic))

Implementation System
With the CEO as the implementation leader, directors, executive officers, and managers (9members) as committee members, and the QMS • PM Promotion Department (2 members) as
the executive office, the Implementation Committee holds a meeting once every two months toshare information on the direction of initiatives and issues faced by each division, and to provide
support to ensure that there are no delays.
Starting in December each year, each divisionand department works on topics based on the
OOC’s priority policies and medium- tolong-term plans, and the results of the year’s
initiatives are evaluated in the top assessmentby the implementation leader and the
OYPM Implementation Committee
implementation committee members in October.

Monthly Maintenance Patrol Check

Each group presents the results of their initiatives in the first and second half ofthe year. An interim assessment, preliminary assessment, and top assessment
are conducted in the first and second half of the year. Interim assessment
involves individual improvement (operational improvement), preliminary
assessment involves voluntary maintenance (on-site assessment), and top
assessment involves (1) Individual improvement (operational improvement), (2)Initiative board presentation, (3) On-site assessment, and (4) Scoring.
The top assessment in the first half of the year presents the progress madeduring the period from December to April, and the top assessment in thesecond half of the year presents the results of the initiative from December toAugust. The top assessment is conducted by five people, including the CEO,two directors, and the executive committee chairperson, who each visit thebusiness site, and an employee representative. The participation of employees
as assessors provides a valuable opportunity to convey the thoughts of the
CEO and implementation committee members to employees and for the CEO
and implementation committee members to hear directly from employees. At
each assessment, the assessor provides feedback to the group on theguidance items and follows up at the next assessment.
For the top assessment, the CEO himself provides feedback on the guidance
items to all groups.

Top assessment for the first half in May 2022

QMS • PM Promotion Dept.

CEO

Department/In chargeGroup

Administration Division

Department/Section/In charge

Group

Business Operation Division

Department/Section

Group

Research & Business
Development Office

Laboratory/Section

Group

09

Step 3

Step 4Creation of provisional standards
and visual management

Comprehensive inspection

Environmental stress causedby dust, dirt, and rust iseliminated for preventing
accelerated degradation.

The sources of dust
and dirt are identified
to resolve problems.

Standards are established, anda system is created that allows
users to identify normality andabnormality at a glance.

Comprehensive inspections are
conducted to find equipment
defects and other problems, andcorrective action is carried out.

Continued production under the above conditions will
result in reduced safety, quality, and productivity. Moreover,there was a possibility of manufacturing stoppages due to
unexpected equipment breakdowns and other factors. We
also started OYPM initiatives in response to various
environmental issues such as energy loss.

Returning equipment tooriginal functionality

Improved work
efficiency

Early detectionof abnormalities

Improved equipment

Steps 1 through 4 are repeated by front-line staff in the workplace.
We aim to create a safe, stable, efficient, and comfortable workplace.

Voluntary Maintenance ((1) Human Resource Development, (2) Comprehensive 5S, and (3) Equipment Maintenance)
Our company aims to be the cleanest plant in Japan, and all employees throughout the company are working on OYPM initiatives as part oftheir jobs to realize this goal.
(1) Human resource development (Equipment maintenance learning site:
Shiba learning site) (Improve skills by ourselves)(2) Comprehensive 5S (5S by ourselves)
5S can be practiced because we are operators who are proficient in using equipment.
In March 2022, we created a 5S handbook that explains OOC’s original 5S in aneasy-to-understand manner.
We use it as instructional materials for effectively passing on 5S skills.

Learning• Tools• Machine tools• Electricity• Devices (cut models), etc.
Hands-on instruction• Simulated experience of electric
shock, liquid spraying, and otherpotential hazards in the field
improves safety awareness!

Hands-on
instructionHRdevelopment

5S Chart
Comprehensive
5S

OYPM
initiatives

Protecting and repairing your own equipment by yourself

Set in order (2S)

Sort (1S)
Improved workability
and safety by creating
more work spaceStandardize (4S)

(3) Equipment maintenance (self-maintenance)

Sustain (5S)
Supervisors provide
guidance based on thethree-actuals principle

Early detection ofabnormalities throughvisual management

Equipment
maintenanceThings that areneeded are easily
accessible

Shine (3S)
Daily cleaning for
conducting equipment
inspections

FuturePresent

Past

Breakdown
maintenanceReplace after
equipment failure

Predictive maintenance
Understand the condition of(1) Preventive
maintenance the equipment, predict failure,
and replace(2) Corrective
maintenanceTraining using the 5S handbook(1) Replace before equipment failure(2) Prevent recurrence of equipment failure(1) HR development(3) On-site assessment (4) Scoring(3) Equipment
maintenanceAwards System
Based on the total score of each assessment, the top 13 groups in four categories

Laboratory/Department/Section

Group

Production Division

Department/SectionGroupsystem has energized the initiatives of each group, leading to increased motivation for

Quality Assurance Office

Department/Section

Groupeach and every group member. Also, through the presentation of each assessment,

are awarded at the company anniversary ceremony. The introduction of the awards

the initiatives of each group are shared for enabling horizontal deployment, andActively participate and achieve goals

Step 2

Measures for identifying problem
sources and locations

Evaluations by customers(1) Individual improvement(2) Initiative board(Operational improvement)
presentation

R&D Division

Show policies and goals

Step 1
Initial cleanup

Better quality
comes from a clean
manufacturing site

Enhanced Corporate Value

GroupsCorporate Planning Division

Implementing OYPM initiatives

Before OYPM initiatives

Learning

Assessments

Organizational Chart of OYPM Initiatives(Implementation and Execution Organization by Division)
OYPM Implementation Committee

Implementation of OYPM Initiatives (Step Implementation)

Implementation Period
Implementation period: 1 year (12 months) (1) Actual implementation
period: December to September (implementation based on initiative plan)(2) Top assessment: October (3) Preparation period: October toNovember (planning initiatives for the next fiscal year)

To ensure that daily 5S are being maintained in a good state, the PM
department head makes a monthly patrol of the group’s managed
maintenance area, and issues instructions for corrections andimprovements and provides guidance based on the “three actuals” principle(actual site, actual part, and actual situation). For any shortcomings at theinspected site, group members are asked why these shortcomings occurredto gain a better understanding of the meaning of 5S and take corrective
action. Furthermore, since 2020, we have added quality and safety
elements to the patrol items and have been conducting quality patrols,
aiming for zero quality problems with the participation of all employees.

Improved morale Higher sales

Company that is easy to work for

Initiatives Implemented in Groups

cooperation between organizations is enhanced through overall optimization.

Plant tours in progress

Plant tours on our OYPM initiatives have received
high grades from two-party audits and ourcustomers, and this has contributed to theenhancement of our corporate value.

Raising
employeeawareness

OYPM
initiatives(2) Comprehensive 5S

Process
improvement in
manufacturing andoffice work, etc.

OYPM initiatives, which aresynonymous with human resource
development, are endless andcontinue to evolve as never-ending
initiatives.

Production and safety
improvement
Cost reduction
Quality improvement
Information visualization, etc.

Enhancing
corporate value

Through OYPM initiatives, we will continue to provide better services and products inconsideration of safety, environment, and quality.
10
12CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

OOC’s Strengths

SpecialFeatureAdvanced Semiconductor Materials
Meeting the Needs for Photoresist Materials for Semiconductors andSynergy with the OOC GroupThe development of digital devices and communication technology is essential for AI usage, digitaltransformation (DX), and aspects of the new lifestyle called the New Normal such as teleworking,which has been growing in recent years. Semiconductors play an increasingly crucial role indetermining these capabilities.
By using the technologies and strengths that we have cultivated over the years, the OOC Groupdevelops and sells photoresist materials for semiconductors, which are an indispensable element in
the manufacture of semiconductors.

Features of Semiconductor Photoresists

70%
More than

Semiconductor photoresists are a material necessary for creating semiconductor microcircuits, which
use light to create microscopic patterns. Finer patterns enable the creation of even higher

share of global
market for
ArF resist
monomers

performance semiconductor circuits, and so the demand for quality in these materials continues toincrease with miniaturization.
The OOC Group continues to provide accurate and speedy solutions to the high quality requirements
for ultrafine resolution, and boasts the world’s top share in the field of ArF resist monomers.
ArF resist monomers

R

KrF• Fast technical innovation cycle

ArF
EUV

Photosensitizer
Solvent

The presence of impurities has a significant impact on theformation of ultrafine patterns. Particularly strict standards
have been established for metal content, which must be
controlled at the ppt (parts per trillion) level as a minimum.
In addition to chemical structures, control items and levels forproperties are also diversifying, requiring individualized
customer- and process-specific solutions.

Exposure process and pattern pitch

R R R

Material Characteristics• Ultra-high purity• Wide range of chemical structures and control standards

PolymerO

Photoresists for semiconductors are an extremely special field thatcombines the speed and technical requirements unique tosemiconductors with the various characteristic influencing factors
unique to photoresists. In response to this uniqueness, the OOC
Group leverages its strengths to meet our customers’ expectations.
In terms of technology, the purification technology developed in ourcore business of acrylic acid esters and the synthesis technology
developed for pharmaceutical intermediate materials provide the

100 nmThe industry’s rapid technological innovation cycle requires
speed and certainty in material development,
industrialization, and legal compliance for chemical
substances.

technological foundation to meet the high technological demandsof semiconductor materials. Also, our integrated approach fromhigh-mix low-volume production and R&D to industrialization
enables us to provide timely solutions to new issues that
continually arise in cutting-edge semiconductor manufacturing.
These strengths of OOC create strong synergies with thecharacteristics of the semiconductor business and also continue tocontribute to the development of the semiconductor business.

Our Strengths• Industry-leading acrylic manufacturing technology
With purification technology, which has been one of our strengths
since the early days of the company, and synthesis technology
enhanced through our pharmaceutical intermediates business, we
excel at commercializing high-quality, specialty compounds, and canalso handle the ultra-high purity required for semiconductor materials.

• Strengths in high-mix low-volume production
The OOC Group’s characteristic high-mix, low-volume
production system enables us to customize materials to meetcustomer needs and to provide meticulously-crafted solutions.

• Integrated support capability from R&D to industrialization
Our integrated approach enables efficient industrialization ofdeveloped materials and speedy and reliable compliance withchemical substance regulations.

10 nm

Polymer

Pitch

Contributing to Society throughSemiconductor Resist Materials
Further evolution of semiconductors will enable faster speeds for
information processing and greater development in AI and
automation technologies. Furthermore, miniaturization ofsemiconductors allows high-capacity processing with smaller IC
chips, which can significantly reduce energy usage in downstream
products as well as in final products, thereby reducing CO2
emissions.
By continuing to develop cutting-edge photoresist materials forsemiconductors, the OOC Group will continue to contribute tosociety by supporting the development of these technologies andenergy savings.

11

12

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

OOC Products Used in Everyday Life

Never Seen but Always Near.
Mobile terminals (displays)

TVs and PCs (displays)

Vehicle top coats

Adhesives and raw materials
for color filters and coatings

Adhesives and raw materials
for color filters and coatings

Environmentally friendly,soil-resistant raw materials
that automatically repair
small scratches

Wraps

I

VR goggles

AN
RG

AO

AK

OS

TR

US

ND

LI

ICA

EM

H
CC

Energy-saving,environmentally friendly
raw materials for UV
inkjet prints that can beapplied to 3D objects
and all other surfaces

.
TD
YL

Materials for the
display componentsof VR goggles

Onboard vehicle
monitors
Raw materials for onboard
electronic device displays
and integrated circuits

Contact lenses

R

Monitoring cameras(rear-view monitors)

Gel nails

IUM

Components creating resistanceto soiling and fogging

Paint forthe bottoms
of ships

Raw materials for water-soluble
inkjet printer ink that reducesurface tension

Materials for paints
used to prevent
barnacles fromattaching

Raw materials thatuse light to harden
quickly and saveenergyCommercial
refrigerator
showcases
SurveillancecamerasonchemizMaterials thatprevent fogging of
the door

Cardboard
Raw materials forplastic sheets
applied to unevensurfaces such as
cardboard orconstruction paper

Components creating
resistance to soiling andfogging

Hair care products

Cosmetics

Raw materials used to stiffen
hair or give it volume

Low-odor,paraben-free raw
materials withmoisture-retaining
and antibacterial
properties

RN

AR

U
AQ

Household printers

Raw materials creating
good oxygen permeability
and wettability

O
EB

Masks andprotective wear
Water- and oil-resistant
raw materials

Protective
eyewearComponents creating
resistance to soilingand fogging

Medical andsurgical tapes
Bathroom mirror films

Materials for tapes to secure
bandages and gauze to theaffected area

Raw materials creating resistanceto fogging and soiling

13

14
12

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Promoting Sustainable Management

The Process of Building a Sustainable Society
We will incorporate social issues into our management and utilize our responsiveness to build both a company and society that are sustainable.

Management Philosophy of OOC

Social Environment

Social issues
envisioned by OOC

We will place the highest value on each person’s individuality and will contribute to thedevelopment of society together with our clients by providing materials with unique functions.

Input

At the time of the review of the NS10 Second Five-year Medium-term Business Plan, the OOC Groupestablished a philosophy system with an awareness of sustainability, and is working to link materiality and
SDGs with our medium-term departmental goals.

Strategy

Financial capital● Total assets: 49.8 billion yen

OutputManagement Vision
Providing value to the global market as acorporate leader in specialty acrylates.

● Capital adequacy ratio: 77.5%

Long-term Business Plan
Climate changeIntellectual capital● R&D expenses: 1.3 billion yen● Number of patents held: 234

Population
declinein Japan

Human capital● Number of consolidated

employees: 447

Next Stage 10 (NS10)(from the fiscal year ended November 30, 2015 to
the fiscal year ending November 30, 2024)

NS10 Second Five-year Medium-term Business Plan(from the fiscal year ended November 30, 2020 tothe fiscal year ending November 30, 2024)

Medium-term Policy● Creating a corporate culture that promotes

integrity, passion, and creativity● Productivity-oriented resource deployment

and solid growth

Manufacturing capital
Stable supplyof energy● Company initiatives designed for coexistencewith the planet and the public● Capital investment:

1.6 billion yen

Social capital

Materiality

Outcome

Product Services Offered
Chemical Products BusinessNet sales: 12.0 billion yen● Raw materials for paints● Raw materials for adhesives● Environmentally friendly
acrylate

Technologicalinnovation

products are sold: 18

materials

PM initiatives● The cleanest plant in Japan15

See pages 33 to 35 for details

Electronics Materials BusinessNet sales: 14.5 billion yen● Display materials● Semiconductormaterials

S: Society
See pages 36 to 44 for details

Contributing toshareholders
Profit sharing

See page 24

Specialty Chemicals BusinessNet sales:
8.5 billion yen● Cosmetics materials● Functional materials

Contributing tosociety
Building a sustainable
society

Development of New Businesses● Functional acrylic

Natural capital● Use of plant-derived raw

Efficient useof resources

E: Environment

Stable supply of products
and services
Higher reliability

See page 24

See page 25● Number of countries where

Contributing toclient companies

elastomers● Organic piezoelectricmaterials

See page 25

Contributing toemployees
Creating a safe, secure,and engaging workplace

G: GovernanceSee pages 26 to 29 for details

16

CSR REPORT 2022

History and Strengths ofValue Creationand safety as long-term business goals, and will steadily implement the long-term business plan andcontribute to the achievement of the SDGs by starting with materiality, which is a key CSR issue, andMateriality from perspectiveof stakeholders

The OOC Group has established five KPIs for E (environment), S (society), G (governance), productivity,

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

E Dealing with climate change through decarbonization
E Ensuring environmental compliance
S Giving back to the local area around each office■ Dealing with climate change

through decarbonization

E Environment■ Managing waste and wastewater■ Allocating water resources■ Increasing sales of eco-friendly

products■ Use of renewable energy■ Managing and reducing

chemicals and waste throughout
product lifecycles■ Proactive use of resource

recycling

S Creating a diverse workforce■ Making the climate crisis

personal■ Reducing environmental impact■ Product development thatconsiders the balance between
nature and society

Major Initiatives■ Reducing water consumption■ Complying with environmental laws andregulations of countries and regions
around the world■ Environmental compliance■ Switching to more environmentally friendly
modes of business■ Proactive use of resource recycling■ Disclosures compliant with TCFD
recommendations■ Ensuring product safety and quality■ Promoting health management■ Respecting human rights■ Improving employee satisfaction■ Providing unique functional materials■ Promoting sound work-life balance■ Respecting dignity and rights■ Initiatives for diversity■ Creating a safe and healthy■ Dealing with diversifying information and values

S Society■ CSR-oriented procurement■ Managing raw materials■ Giving back to the local area

■ Proactive approach to diversity(values and variety)■ Coexistence with the planet andthe publicaround each office

G Governance■ Improving corporate

governance■ Business risk management■ Pursuing corporate ethics andintegrity■ Maintaining fair and impartial business

relationships that make the most of andcomplement each other’s strengths■ Constructive dialogue for a win-win

Materiality from perspective of Company

Long-term Business Target
2024■ CO2 emissions (compared to FY2013)

Very highContributing to
the Sustainable
Development
Goals (SDGs)

15% or greater reduction
Fiscal 2030

30% or greater reduction
Fiscal 2050

Achieve carbon neutrality■ Job satisfaction index

Vibrant organization
grade B (top 10% to 30%)

■ Creating a CSR-oriented procurement system■ Ensuring stable procurement of raw materials

for key products■ Ongoing interactions with local areas■ Promoting dialogue around sustainability■ CGC compliance rate100%

(with a higher level of governance)

relationshipand comfort■ Sustainability management

environment■ Proactively participating in society■ Improving consumer security

E Increasing sales of eco-friendly products

throughout entire value chains■ Looking into the use of renewable energy■ Improving client satisfaction■ Creating a diverse workforce

G Pursuing corporate ethics and integrity■ Studying how to reduce CO2 emissions■ Workforce recruiting and training■ Stakeholder engagement

17

Guidelines for Conduct

compliance(Creating engaging workplaces)

S Improving consumer security and comfort
G Business risk management

G Sustainability management■ Ensuring environmental■ Creating safe and pleasant workplaces

S CSR-oriented procurement

E Allocating water resources
S Respecting human rights

Third-party Opinions

S Workforce recruiting and training

E Managing waste and wastewaterHigh

Medium-term Policy

S Society

S Managing raw materials

implementing medium-term policies, Guidelines for Conduct, and major initiatives.

Materiality

E Environment

S Stakeholder engagement

S Creating safe and pleasant workplaces
G Improving corporate governance

G GovernanceHelping create a sustainable future

ESG-conscious Management to Achieve the Long-term Business Plan

Very highPromoting Sustainable Management

Top Message■ Building a global partnership forsustainable development■ Optimizing safe operations andmanagement efficiency■ Contributing to the creation of asustainable future■ Ensuring transparency■ Proactive, effective, and fair disclosure■ Keeping our promises with sincerity
and humility■ Ensuring systematic crisis management■ Placing safety as our top priority■ Solving issues of public concern bycreating value■ Improving management transparency

and making management systems more
efficient■ Lost time injuries

0 cases/year■ Spread of our Management Philosophy■ Creating a risk management system

18

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Promoting Sustainable Management

Initiatives for Materiality
Material issue (materiality)

ESG
area

Dealing with climate change
through decarbonization

Targets and achievements for specific initiatives for the materiality identified on page 17.
Stakeholders

Employees

Clients/
Investors/
Suppliers Shareholders

SocietyChildren of
the futureMainstakeholders

Fiscal 2021
Major initiatives

Fiscal 2024 targets (KPI)
Achievements

Main activities

Seepage(s)Studying how to reduce CO2 emissions
throughout entire value chains
Looking into the use of renewable energy

CO2 emissions reduction rate: 15% or more(compared to fiscal 2013)

5.2%• Upgraded to energy-saving compressor• Installation of solar power generation system and study
for next installation• Study for purchase of renewable energy electricity

P. 34

○

○

○

◎

Children of
the futureManaging waste andwastewater

○

○

◎

○

Society

Proactive use of resource recycling

Recycling rate: 25% or more

20%

Environmental assessment planned for
installation of waste oil boiler

P. 35

Allocating water resources

○

○

○

◎

Children of
the future

Reducing water consumption

Maintain current level of water
consumption(+5% or less compared to fiscal 2019)

1.7%

Maintain current status by servicing andupdating heat exchangers

P. 33

◎

Children of
the future

Switching to more environmentallyfriendly modes of business

Production volume of environmentallyfriendly products(15% or more of total production volume)

9.4%

Developed acrylates using biomass-derived
or recycled materials

P. 24

Increasing sales of
eco-friendly products○E

Ensuring environmental
compliance

○

○

○

◎

○

○

Clients/
Suppliers

Complying with environmental laws
and regulations of countries andregions around the world

P. 35

◎

Society◎○

Employees

Entry population formation: 10% increase(compared to fiscal 2018)

56.2%

Obtained 2022 certification as an excellent
health management corporation

Retention rate after 3 years of
employment: 100%

91%

Started interviews at 1, 3, and 6 months of
employment in some departments

○

◎
◎

○

○

○

Employees

Employees

Improving workforce training

Satisfaction with training:
3.5 points or higher out of 5 points(Engagement)

2.92 points

Adopted a system that allows employees
to work after the age of 65

Employees

Combating harassment
Dealing with diversifying informationand values

Compliance education participation
rate: 100% (conducted annually)

100%

Implementation of compliance training
For all employees: once
For all managers: once

Grade C
(top 30%
to 45%)Engagement survey implementation

Employees

Engagement survey results:
Vibrant organization grade B(top 10% to 30%)◎

Employees

Gross profit margin per employee:
50% increase(compared to fiscal 2019)29%

Improved profitability of unprofitable items(product consolidation, etc.)◎

Employees(Ease of working)
Percentage of paid leave taken:
70% or more

55.6%

Continue to study and implement measures
to encourage employees to take paid holidays

Employees(Ease of working)Flexible work hours adoption rate
(to be considered)

58.5%

Promoted Zoom meetings, telecommuting,and flexible work hours for the post-COVID
world

◎

S

Creating safe and pleasant
workplaces

4.5%

Prepared a plan for installing VOC
combustion equipment○◎

Respecting human rights

Revised Safety Data Sheets (SDS) in
accordance with JIS revision

PRTR emissions reduction rate:
60% or more(compared to fiscal 2019)

Increasing the level of recognitionof OOC

Workforce recruiting
and training

Comply with laws and regulations related
to chemical substances

Promoting health management
Promoting sound work-life balance◎

Applicable SDGs

P. 37

P. 39

P. 36

P. 38

◎

○

Employees(Health) Obtained certification as an
excellent health management corporation

Obtained

Introduced a collaborative system withhealth insurance associations

P. 40

◎

○

Employees(Safety) Lost time injuries: 0 cases/year

3 cases

Improved on-site patrols to reveal unsafe
areas

P. 41

◎: Key stakeholders○: Stakeholders involved
19

20

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Initiatives for Materiality
Material issue (materiality)

ESG
area

Creating a diverse workforce

Stakeholders
Employees

Clients/
Investors/
Suppliers Shareholders

SocietyChildren of
the futureMainstakeholders

◎

○

○

Employees◎○○

Employees◎○○

Employees○

Clients/
Suppliers◎

CSR-oriented procurement

Fiscal 2021
Major initiatives

Initiatives for diversity

Establishing CSR-oriented
procurement

S◎

Managing raw materials

Ratio of women in management positions:
10% or more (target in fiscal 2026)

2.4%

Held forum for exchange of opinions amongfemale employees at all business locations

Increase in the percentage of employees
taking childcare leave and leave forchildcare purposes: 20% or more (male)

11%

Started three-way meeting between the person planningto take leave, the head of the department, and theperson in charge in the General Affairs Department

Endorsement rate for our CSR-oriented
procurement guidelines: 80% or more(based on purchase amount)

54%

Sent and collected consent forms, mainly
from contract manufacturers

Number of initiatives with local
communities to solve social issues:
At least 3 per month
Demonstrate existence value byaddressing sustainability in society(qualitative goal)

Stakeholder engagement

○

○

◎

○

○

Investors/
Shareholders

Promoting dialogue aroundsustainability

Improving consumer security
and comfort

○

○

○

◎

○

Society

Raising awareness of how tobenefit the community throughbusiness activities

○

○

○

○

○

○

◎

○

◎

Children of
the future

Solving issues of public concern
by creating value

Investors/
Shareholders

Investors/
Shareholders◎◎

Increased advertising for mid-career hiring

Ongoing interactions with local areas◎

Pursuing corporate ethics
and integrity

5%

Identify supply risks (manufacturinglocation, supplier map)○

Business risk management

Increase ratio of mid-career hires:
20% or more

Ensuring stable procurement of
raw materials for key products○

G

Main activities

Clients/
Suppliers

Society

Improving corporate
governanceAchievements○

Giving back to the local areaaround each officeSustainability management

Fiscal 2024 targets (KPI)

Improving managementtransparency and making
management systems more efficient• Selected key raw materials and conducted sample
evaluations for multiple purchasing• Prepared list of raw materials to be purchased and suppliers
2.5

6.9%

P. 38

P. 30

Promoted interaction with the local
community while taking care to preventthe spread of COVID-19

P. 43-44

Promoted dialogue with each stakeholder
with an awareness of sustainability

P. 45

Number of serious violations of laws
and regulations: 0 cases/year

0 casesP. 11-12
Newly developed biomass acrylate using
non-petrochemical feedstock

Thorough awareness of legal compliance96%

Disclosed more information in English
Adopted performance-linked stockcompensation plan
Reduced cross-shareholding
Established priority risks and disclosed
proposed countermeasures(Annual Securities Report)

◎

○

○

Clients/
Suppliers

Creating a risk management system

Occurrence of performance revisions
due to the emergence of recognition risks:
0 cases/year

0 cases○○○

Employees

Spread of our Management
Philosophy

Penetration of Management Philosophy:
4.0 or higher

3.4◎: Key stakeholders○: Stakeholders involved

Applicable SDGs

Met the increased demand for semiconductor
and display materials due to increased
teleworking

New net sales ratio: 10%(Cumulative for past 4 years)

CGC compliance rate: 100%(with a higher level of governance)Seepage(s)Linked engagement survey items toManagement Philosophy and quantified themP. 26-29

P. 30-32

P. 45

Other detailed ESG data is available on our website.
OOC Viewed in Data
https://www.ooc.co.jp/en/csr/

ESG Datasheet
Governance (G) Data
https://www.ooc.co.jp/en/csr/pdf/esg_governance.pdf
Environment (E) Data
https://www.ooc.co.jp/en/csr/pdf/esg_environment.pdf

21Society (S) Data
https://www.ooc.co.jp/en/csr/pdf/esg_society.pdf

22

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Promoting Sustainable Management

Business Domains of OOC Group
Based on acrylic acid esters, we provide materials that can be usedas raw materials for a variety of resins that support our daily lives.

Business and Main Products
The OOC Group is a B-to-B manufacturer
able to produce a wide variety of specialty
acrylic acid esters in small quantities.
We have a diverse product lineup, which
includes many items for which the OOC
Group is the world’s largest supplier.

Chemical
Products Business12.0 billion yen

Specialty Chemicals
Business
8.4 billion yen

Specialty Chemicals
Business
1.5 billion yen

Operatingincome

Sales

35.0

Chemical Products Business
Chemical Products
Business
0.9 billion yen

Strategy

5.9

billion yen

External
environment

billion yen

Electronics Materials
Business
14.5 billion yen

Raw materials for paints

Electronics Materials
Business
3.4 billion yen

OOC Group in Figures

20.0

Number of consolidated
employees

Capital investment

447

1.29

81.8

13.6

%

%

Please refer to the website for product details.
https://www.ooc.co.jp/en/products/chemical/

Market capitalization

Return on equity (ROE)

16.7

Raw materials for adhesives

billion yen

2020-2024

Operating income to
net sales

Products
Raw materials
for paints

R&D expenses

billion yen(Non-consolidated: 399)

Company
statusRaw materials
for adhesives
Environmentallyfriendly acrylate
Medium-termplanbillion yen

Share price × number of shares issued

We will build an absolute position in the global market for specialty
acrylic acid esters by concentrating our resources on high-purity
products differentiated by our superior distillation/refining technologies,
and by continuously launching new products by leveraging our organic
synthesis technologies.
(Opportunity) Increasing demand for plant-derived raw materials to builda decarbonized society(Risk) Stricter regulations on chemical substance management due toclimate change and biodiversity risks(Strength) Organic synthesis technology, polymerization prevention
technology, distillation/refining technology, extensive productlineup and knowledge(Issue) Revision and abolition of unprofitable products
These materials are used for automobiles, smartphones, and otherapplications, and can provide functions such as high reactivity and highadhesiveness that cannot be achieved with general-purpose products.
Due to their high purity, they have advantages such as low coloring andlow viscosity.
These materials can be used as ordinary solvents as well as for
UV-curable and anaerobic adhesives. Other advantages include low
coloration, low viscosity, and low odor, as well as the same advantages
offered by our paint materials.
As part of our initiatives pursuing the Sustainable Development Goals(SDGs), we are developing acrylate using biomass-derived(plant-derived) or recycled materials.
(Measure) Improve profitability of unprofitable items(Progress) Product consolidation in progress(Measure) Enter new markets and create environmentally friendly products(Progress) Biomass acrylate (Viscoat #E series) was launched as anenvironmentally friendly product.

Business Portfolio

Electronics Materials BusinessWe clarify the characteristics of our material groups and are implementing initiatives● We will further expand our semiconductor business with cutting-edge materials.

● For specialty chemicals, we aim to improve their contribution to profit

through higher functionality and overseas expansion.

● In specialty acrylic acid esters, we will implement product selection andfocus for low-purity products.
On the other hand, for high-purity products, we aim to increase added
value through overseas expansion and even higher purity.

Application development

Market growth potential

applications.

Growth engine

Secure market share

Higher functionality

Specialty chemicals●

Enter cutting-edge markets
Electronics materials

Specialty solvents

Semiconductor materials
ArF resist materials● EUV resist materials●

Display materials

Specialty chemicals

Cosmetics materials

Chemical products

Specialty acrylic acid
esters (low-purity products)

Company
statusCommercialization

Restructuring●

External
environment

Enter peripheral fields●

New businesses

Stretchable conductive materials● Organic piezoelectric materials

Strategy● For new businesses, we will build research environments and develop

Higherfunctionality

Key businesses

Overseas
expansion
Expansion into new markets
Electronics materials

Display materials

Selection and focus

Products
Displaymaterials

Ultra-high purification
Overseas expansion
Chemical products

Specialty acrylic acid esters(high-purity products)

Semiconductor materials
Please refer to the website for product details.
https://www.ooc.co.jp/en/products/electronic/

Semiconduct
or materials
Medium-termplan

We will continue to aggressively invest in facilities to meetincreasingly stringent quality requirements while maintaining
sufficient supply capacity for the expanding market. In addition, we
will develop next-generation materials and expand into peripheral
materials by utilizing the high-quality control capabilities andsynthesis technologies cultivated in our existing businesses.
(Opportunity) Expansion of the electronics materials market,
including peripheral fields(Risk) Supply chain disruptions, rise of alternative products andtechnologies(Strength) Rapid capital investment, organic synthesis
technology, integrated manufacturing from raw
materials, high quality control technology(Issue) Diversification of customer needs, response to overseas
markets
We develop photo-curable resists and polymers for resists fordisplays, such as patterning materials and optical materials thatcan meet the needs for greater functionality in displays.
We are developing new, high-quality acrylic monomers, including
adamantyl monomers and lactone monomers, which are raw
materials for resists used in the manufacture of semiconductormaterials.
(Measure) Trial production at new facilities, customer certification(Progress) Further study on new facilities

Market share

23

24

CSR REPORT 2022

History and Strengths ofValue Creation

Promoting Sustainable
Management

Special Feature:
OOC’s Strengths

Top Message

G Governance

E Environment

S Society

Third-party Opinions

Corporate Governance
We are striving to improve the transparency and efficiency of our management inorder to sustainably increase our corporate value over the medium to long term.

Specialty Chemicals Business
Strategy
External
environment

Cosmetics materials

Company
status

Products
Cosmetics
materials
Functional
materials

Functional materials

Medium-term
plan

Please refer to the website for product details.
https://www.ooc.co.jp/en/products/function/

Basic Approach
We will provide the global market with materials with special
functions, made possible by having the technology to synthesize
specialty acrylic acid esters and polymerize them.
(Opportunity) Increasing demand for plant-derived raw materials
to build a decarbonized society(Risk) Rise of alternative products and technologies, and loss ofsales due to price competition(Strength) Knowledge to propose functions from molecular
structures, manufacturing technology to perform
integrated manufacturing from raw materials(Issue) Development of new markets by expanding applicationsof existing products, development of new product groups

Corporate governance is an area that the OOC Group works actively to improve andaugment. Our efforts in this area are designed to ensure that we act honestly andincrease management transparency while improving the efficiency and speed ofmanagement systems. We view these efforts as a way to ensure sustainable
company growth while improving our corporate value over the medium- to long-term.
Corporate governance improvements are approached as a key management issue,
as we work to foster shared going-concern (business continuity) assumptions withstakeholders both inside and outside the Company.

In addition to mousses, gels, and waxes, the acquisition of thebusiness has allowed us to develop and supply shampoos,rinses, hair colorants, and other applications as cosmetics
materials for hair care.
As functional materials with special characteristics, we develop
and provide inkjet materials, coating materials, andsuperhydrophilic coating materials.
(Measure) Further overseas sales expansion(Progress) Expanded overseas sales channels in tandem withbusiness acquisitions(Measure) Expand sales of hydrophilic coating agents(Progress) Expanded sales in surveillance cameras,
refrigerators, rice cookers, etc.

Governance Highlights (as of November 30, 2021)
Number of meetings ofthe Board of Directors

16

Number of meetings ofthe Board of Auditors

16

Number of meetings of
the Advisory Committee

5Nominations

Number of interviews
regarding CSR/ESG

6

Remuneration

3

Material Issues: Improving Corporate GovernanceFiscal 2022

Improving management transparency and making management systems more efficient[Targets and● Addressing each issue to improve the effectiveness of the Board of Directors● Responding to the revised CG code ● Enhance disclosure of ESG information and proactive dialogue

issues]Research & Business Development Office
Strategy

External
environment

Functional acrylic elastomer materials
Company
statusOrganic piezoelectric materials

Products
Newlydeveloped
products

Medium-term
plan

25

Through the clarification of target markets and the more deeply
integrated joint development, we will create new value based on
specialty acrylics and establish the pillars of our next generation
businesses.
(Opportunity) Increasing opportunities to create new businesses
through efforts to achieve the SDGs, and accelerating
growth of businesses related to remote andnon-contact technologies in a post-COVID society(Risk) Difficulty in securing superiority of proprietary
technologies due to integration of management resources
as DX accelerates(Strength) Accumulation of know-how related to acrylic materials,
advanced technology and extensive knowledge ofmaterials with unique characteristics(Issue) The company is entering new business fields and the
distance to end users is long, so it will take time to create
new businesses. Establishment of product supply system
Using our proprietary acrylic acid esterification, special
polymerization, and compounding technologies, we havedeveloped stretchable acrylic elastomer materials with highextensibility and flexibility, and stretchable conductive materials that
add conductivity to acrylic elastomers. We have also developed
flexible organic piezoelectric materials, which we expect to see
effectively used in various fields such as wearables, sensors,
actuators, materials for robotics, and automotive resin additives.
(Measure) Launch of new products in new business fields(Progress) Establish new business fields with four productgroups as pillars: elastomers, conductive materials,
organic piezoelectric materials, and light control
materials

Corporate Governance Improvement Milestones
2
1
1

9

■ Director (Internal) ■ Director (Outside)■ Auditor (Internal) ■ Auditor (Outside)

Optimization of director composition
Started executive officer system

2014

2
1
2

2
1
2

2
1
2

7

7

6

2015

2016

2017

Feb. 2016

2

2

2

2

5

4

4

4

2018

2019

2020

2021

1
2

1
2

Feb. 2018
Dec. 2018

Created Remuneration Advisory Committee

Dec. 2018

Created Risk/Compliance Committee
Board of Directors

1
2

July 2019
Ratio of outside directors to be 1/3

Increase in the number ofoutside directors by one

Created Nominations Advisory Committee

Ended retirement benefit program

1
2

July 2019
Chairpersonchanged from
CEO to outside
director

Feb. 2018
Dec. 2019Feb. 2022

Outside director appointed
as chairperson

26CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Role and Authority of Independent Outside Directors and Advisory Committee
OOC continues to strengthen its corporate governance system, including theappointment of independent outside directors and the establishment of an
Advisory Committee, in accordance with Use of Voluntary Mechanisms(Supplementary Principle 4-10 (1)) of the Corporate Governance Code.
At present, we have appointed two independent outside directors. Both of them
express their opinions at the Board of Directors meetings and provide advice tothe directors as necessary, utilizing their highly specialized knowledge andabundant experience. We will continue to examine the possibility of having

OOC Group’s Corporate Governance Organization
Stakeholders at annual general meeting

independent outside directors as a majority of the Board of Directors.
In addition, two Advisory Committees, the Nominations Advisory Committee
and the Remuneration Advisory Committee, established under the Board of
Directors, are responsible for considering important matters such as thenomination and compensation of our directors. Both of these committees arecomposed of two independent outside directors and the CEO, and are chairedby an independent outside director who also provides appropriate involvement
and advice.

Create and Implement a Succession Plan
Board of Auditors
I

O

Nominations Advisory Committee

Board of Directors

O

I

I

I

I

O

O

I

O

I

O

O

Remuneration Advisory Committee

O

I

Accounting Auditors

I

Director(Internal)

O

Director(Outside)I

Auditor(Internal)

O

Auditor(Outside)Internal Control Committee

CEO

Risk/Compliance Committee

Management Council

O

O

Internal Audit Office

Executive officers, departments, and affiliates

Officer Profiles (as of February 25, 2022)

From the perspective of sustainable growth of our business over the medium tolong term, we recognize that the development of management personnel is oneof the most important issues to be addressed. Therefore, in accordance with
Roles and Responsibilities of the Board of Directors (Supplementary Principle
4-1 (3)) of the Corporate Governance Code, the Board of Directors is proactively
responsible for the formulation and operation of the succession plan.
Specifically, we believe that the incumbent himself/herself should be actively
involved in the selection of a candidate to succeed the CEO, and that theincumbent should be responsible for the succession plan. The Nominations
Advisory Committee may take a leading role in cases where the incumbent has
difficulties in selecting a successor candidate.
On the other hand, when the option of reappointing the incumbent is included,in order to ensure the fairness of deliberations, the necessity of reappointment
shall be considered only by the chairperson and the members who are outside
directors at the Nominations Advisory Committee. In addition, the Nominations
Advisory Committee shall receive a full report from the CEO on the succession
plan and the specific nomination of candidates to succeed him/her, exchange
opinions, consider the evaluation of the CEO from an independent standpoint
and the OOC’s management issues, and provide feedback.
With respect to the specific evaluation of candidates for successors, theNominations Advisory Committee will make a judgment on the appropriatenessof the proposed candidates selected by the incumbent from an independentand objective standpoint.
The following is the Succession Planning Policy and Development Plan Policy
formulated on January 22, 2021.
(1) Succession Planning Policy
The formulation and implementation of the CEO’s succession plan is theCEO’s authority and duty.
The Nominations Advisory Committee shall formulate the criteria for
selecting candidates for CEO, the selection process, and the development
plan, as well as confirm the overall process , monitor the succession plan,and report to the Board of Directors on the candidates.
(2) Development Plan Policy
In order to develop the next generation of human resources who will be
responsible for the execution of management to support continuous growth,
the CEO will constantly envision candidates for successors, mainly directors
and executive officers, and strive to develop them.

Efforts to Improve Management Transparency
Enhancement of Information Provision to Overseas Investors

Reducing Cross-shareholding

We are promoting the provision of information in English for overseas investors.
Currently, we provide information in English by disclosing the Notice ofConvocation of the General Meeting of Shareholders, Financial Results, Financial
Results Briefing Materials, and CSR Report on our website, etc. In addition, we
disclose and provide information in English on the Tokyo Stock Exchange, Inc.
website under Summary of Financial Results in the Listed Company Details (Basic
Information) section of the TSE Listed Company Information Service, and areworking to expand the provision of information in English to overseas investors.

(1) Policy for Reducing Cross-shareholding
For cross-shareholding, the Board of Directors will annually review eachindividual case and make decisions to reduce the number of shares
held by OOC.

Officer Compensation System
Yasuko Yoshida Naoki Enomoto Tetsuya Watanabe Soichi Honda
Outside Auditor

Outside Director

Director

Skills Matrix for Officers

Masayuki Ando Motomi Ogasawara Takayuki Hamanaka Sobi Nagayanagi Tomoko Takase

Director

CEO

Director

Outside Director

27

Outside Auditor● Chairperson, Committee Chairperson ● Member ● Jury ● Expertise and experience
Collegiate body

Knowledge, experience, and expertiseInternal
Risk/
Board of Management
Control
Compliance
Auditors
CouncilCommittee Committee

Legal,
Nominations Remuneration
Finance Risk andinternal regulatory,
Advisory
Advisory Management ESG Sales R&D International andexperience accounting controls administrative,
Committee Committee
etc.

Name

Board ofDirectors

CEO

Masayuki Ando

●

●

●

●

Director

Soichi Honda

●

●

●

●

Director

Motomi Ogasawara

●

●

●

Director

Tetsuya Watanabe

●

●

●

Outside Director Takayuki Hamanaka

●

●

●

●

●

●

●

Outside Director Naoki Enomoto

●

●

●

●

●

●

●

Managing Auditor Sobi Nagayanagi

●

●

●

●

Outside Auditor

Yasuko Yoshida

●

●

●

●

●

●

Outside Auditor

Tomoko Takase

●

●

●

●

●

●

Job Title

Managing Auditor

●

●

●

●
●

●

●

●

●

●

●

●

●

●

●

●

●

●
●
●

●

●

●

●

●
●
●

●
●

●

OOC has determined the remuneration system and remuneration levels for
directors and auditors in order to achieve medium- to long-term expansion ofbusiness performance and enhancement of corporate value in accordance with
its Management Philosophy.
Remuneration for directors consists of monthly remuneration as basic
remuneration, annual bonuses as performance-linked remuneration, andremuneration in the form of restricted stock. From the perspective of their roles
and independence, outside directors and auditors are paid only the basic monthly
remuneration. Effective from the fiscal year ending November 30, 2022, we haveabolished the medium-term performance-linked compensation and introduced
grant-type performance-linked stock compensation. For the performance-linked
stock compensation, at the 75th Ordinary General Meeting of Shareholders held
on February 25, 2022, it was resolved that, in addition to the aforementioned
compensation for directors, monetary claims (assets contributed in kind upon
granting of common stock from OOC) and monetary compensation shall be paid
after the end of the performance evaluation period in accordance with the degreeof achievement of performance targets during a certain performance evaluation
period. The upper limit of each amount is 40,000 shares of OOC’s common stock
multiplied by the share price at the time of granting (the number of directors at theconclusion of the said ordinary general meeting of shareholders was six).

(2) Criteria for Stock Ownership
We will hold shares only when we believe it is reasonable to do so, forexample, to maintain and strengthen stable and long-term business
relationships with customers and business partners, or to enhance ourcorporate value over the medium to long term. We periodically report on ourholdings to the Board of Directors and consider the appropriateness ofholding each stock by comprehensively taking into account the maintenanceand strengthening of business relationships, the merits of holding the stockover the medium to long term, and whether the benefits and risks associatedwith holding the stock are commensurate with the cost of capital.
(3) Exercise of Voting Rights Related to Cross-shareholding
With regard to the exercise of voting rights for cross-shareholding, inorder to ensure appropriate responses, we have established specificcriteria for the exercise of voting rights that enable us to make acomprehensive judgment as to whether the exercise of voting rights will
enhance the medium- to long-term corporate value of the clientcompany, contribute to sustainable growth, and benefit OOC.
Fiscal 2021 results
Number ofstocks acquired
Number ofstocks sold

Acquisition
Number of shares
0.698
3 acquired
70,600 costbillion yen
Number of
1.236
6 shares sold728,295 Sale price billion yen

We will continue to make efforts to reduce the amount held.

Efforts to Improve Management Efficiency
Improving the Effectiveness of the Board of Directors
With regard to the overall effectiveness of our Board of
Directors, we conducted a questionnaire on the operation,
deliberation, composition, implementation status of issues,
support system, and overall evaluation of the Board of
Directors meetings for directors and auditors. The results of thequestionnaire were compiled, analyzed, and evaluated by the
Board of Directors.
As a result, the effectiveness of our Board of Directors wasevaluated as generally good, confirming that the effectivenessof the Board of Directors has been ensured.

28

CSR REPORT 2022

Reasons for Confirming that the Effectiveness of the Boardof Directors Is Generally Good
• With regard to the composition of the Board of Directors, which has
independence and objectivity, two of the six directors are independent outside
directors, making the ratio of outside directors 1/3, and the Nominations Advisory
Committee and the Remuneration Advisory Committee, which are advisory
bodies to the Board of Directors, have been established, and an independent
outside director has been appointed as the chairperson of each to ensure thesupervisory function of the Board of Directors by providing appropriate reports.
• In August 2020, we developed our philosophy system, and are working to disseminate
our philosophy throughout the OOC Group, and to strengthen the disclosure of
ESG-related information to our stakeholders through the publication of our CSR
Report. In addition, from 2021, we have been disclosing our financial results, financial
presentation materials, convocation notices, and CSR Reports in English.
• In December 2019, the Risk/Compliance Committee was newly establishedunder the Internal Control Committee, which is a subordinate organization of
the Board of Directors, to strengthen the risk management system and develop
a monitoring system for management risks and other risks by the Board of
Directors. In addition, we have taken appropriate measures to deal with the
COVID-19 pandemic, and are working to address risks to business continuity.
• At the end of February 2020, the Board of Directors resolved to abolish the anti-takeovermeasures after thorough discussions, and is striving to further enhance corporate value
by taking measures to achieve the medium- to long-term business plan.
• We hold semi-annual company briefings and quarterly IR with institutional
investors to strengthen communication with investors, and deliberate withstakeholders in mind through quarterly reports and deliberations to the Board of
Directors, and discussions and implementation of improvements to employee
working environments and strengthening community and social contributions.
• We discussed the succession plan and the performance-linked
remuneration system, which were governance issues, and are
currently developing and operating the system.
• During its operations, the Board of Directors is working to improve the provisionof information to members and discussing and deliberating at Board of Directors
meetings. In this era of COVID-19 risks, important meeting bodies attended bydirectors and auditors, such as our Board of Directors, are held remotely, etc.,
and our management is handling these meetings without any problems.
• In addition to individual training for officers, we have held group training
on common themes for officers to further strengthen our support system.

Deeper Involvement of Outside Directors in the Formulationof Medium- to Long-term Business Plans
In the formulation of the medium- to long-term business plan,
we have provided sufficient explanation of the plan to outside
directors. We recognize the importance of holding even deeper
discussions with outside directors on the formulation of
medium- to long-term business plans and will continue tomake this an ongoing issue.

History and Strengths ofValue Creation

Measures for Risk Management
Since December 2019, the Risk/Compliance Committee, asub-organization of the Internal Control Committee, has been
established to operate our risk management system. The
Board of Directors has been monitoring the status of our risk
management through reports from the Internal Control
Committee. We will continue to deeply discuss risks to ourbusiness and other areas at the Board of Directors meetings
based on the content of the monitoring.
Matters Related to the Board of Directors and the Management Council
All directors and auditors attend not only the Board of Directors meetings
but also the Management Council and the Internal Control Committee
meetings, which are held in advance of the Board of Directors meetings
to discuss and deliberate for reporting on internal control items related tobusiness execution and corporate management. In order to further
improve discussions and deliberations at the Board of Directors meetings,
the division of roles and improvement of functions between the Board of
Directors and the Management Council are ongoing issues.

Further Enhancement of Handouts and Content
We have made improvements to the materials distributed andthe content of the topics discussed at the Board of Directors
meetings. In the future, we will continue to make efforts toimprove the understanding of matters to be discussed among
outside directors and auditors and to hold deeper discussions.

Discussion of Corporate Governance Measures
We have discussed and reviewed the introduction of medium-term
performance-linked remuneration and succession planning, andhave established and implemented a system. We will continue tomonitor the implementation of these measures.
On the other hand, as there has not been sufficient discussion on
the gender of directors, we will continue to address this issue.
In order to resolve the aforementioned issues, we recognize that
communication among officers (directors and auditors) will remain
important, and we will continue to improve and strengthen theeffectiveness of the Board of Directors.

Top Message

Promoting Sustainable
Management

Special Feature:
OOC’s Strengths

G Governance

E Environment

Basic Risk Management Policy
The OOC Group will promote risk management to prevent theoccurrence of risks and to protect the safety of officers,
employees, and local residents in the event of an emergency,
and to ensure the continuation of business operations.
1. The OOC Group’s top priority is to ensure the safety of human life.
2. We position risk management as an important management
issue, and work on activities from a company-wide
perspective to prevent the occurrence of risks.
3. We promptly report risk-related information and share it
throughout the company.
4. All officers and employees of the OOC Group shall improvetheir risk sensitivity and promote risk management with theparticipation of all employees.
5. We will respond quickly and appropriately when risks arise,and strive to minimize losses.

Business and other risks and their responses
Risk items

Risk mitigation measures(1) Procurement of raw
materials, crude oil
prices, andfluctuations in raw
material prices

OOC strives to ensure stable procurement of raw materials by
securing multiple suppliers of raw materials. We are also
working to reduce the impact through measures such as linking
to product prices and cost reductions.

(2) Impact on
production due toaccidents,
disasters, andspread of infectious
diseases

In addition to conducting regular inspections of manufacturing
facilities and employee education and training, we haveformulated a business continuity plan (BCP) and conductperiodic exercises to reduce risk in the event that the BCP istriggered. We have implemented comprehensive COVID-19
infection prevention measures at our business sites and aretaking countermeasures and conducting business operations inaccordance with the infection prevention policies prepared byeach local government, OOC, and its subsidiaries.

(3) Legal regulation

We collect information on the operation and revision trends ofdomestic and foreign laws and regulations, and conduct ourbusiness operations in compliance with laws and regulations
pertaining to chemical substances. In March 2021, we established
the Carbon Neutralization Study Committee and have been
implementing initiatives toward a decarbonized society.

(4) Overseas
business
operations

We will acquire and train excellent local human resources,
minimize risk by quickly obtaining accurate information andresponding appropriately, and promote the development ofinternal controls at our overseas bases.

(5) Dependence on
specific fields

New product development and market-oriented productdeployment are underway to optimize equipment and staff
allocation. We are also working to create the highly functional
materials needed in a decarbonized society.

(6) Trends in productmarkets due toeconomicfluctuations

Aiming for a profit structure that is less susceptible to demand
trends and other factors, we are implementing product renewal
and increasing the number of our highly functional,
high-value-added product lines.

(7) Acquisitions,capital tie-ups

When making corporate acquisitions, business acquisitions,capital tie-ups, and other arrangements, we conduct detailed
research on the target company, business, or other investment
and carefully consider the risks involved. For investment
projects, we check the deviation between business performanceand initial plans and take countermeasures as necessary.

(8) Information
security

In addition to establishing an information security policy,building an appropriate system management system, andimplementing security measures, OOC strives to ensure
thorough information management through ongoing employee
education as needed.

(9) Litigation

In addition to complying with laws and regulations, OOC strives
to prevent disputes, litigation, and other risks from arising. In
addition, we have a system in place to respond to lawsuits andother legal matters in cooperation with law firms, etc.

(10) R&D investment

We have a system in place to respond quickly to market
demands in order to provide products that take advantage of
our advanced and proprietary technologies for specialty acrylicacid esters in a timely manner.

(11) Workforce
recruiting

We review our recruitment methods at appropriate times toensure that we have the necessary human resources. In
addition to skill development through employee education andtraining, we are working to improve work-life balance and healthawareness to create a comfortable workplace.

(12) Product quality

Based on our quality management system, we are striving toenhance our quality assurance system. OOC also carries
product liability insurance to cover risks.

(13) Intellectual
property

In addition to strictly managing our technology and expertise,
we conduct thorough investigations to ensure that we and our
subsidiaries do not infringe on the intellectual property rights ofother companies, and develop our business in such a way that
we do not infringe on the rights of other companies.

Objectives
1. Ensuring the safety of human life
2. Business continuity
3. Loss avoidance through risk reduction
4. Securing the trust of stakeholders
5. Enhancing corporate value

Risk Management Process
1. Identify and assess risks.
Identify the risks that affect the business plan for each fiscal
year and evaluate them in terms of their impact onmanagement, frequency of occurrence, and vulnerability.
2. Determine critical risks.
Based on the results of the evaluation, select the OOC Group’s priority
risks, and consider and select the necessary countermeasures.
3. Monitor the implementation status of risk measures, etc.
Monitor the key risks, including the implementation status ofplanned risk measures.

Risk identification/classification

29

Risk impact size

We will audit from outside the company as arepresentative for our stakeholders

In order to enhance corporate
value, it is important to deepen
discussions among executives
and employees on diverse
management issues, taking into
account the perspectives of all
Naoki Enomoto
stakeholders. In the debate overOutside Director
integrated reports, for instance,
there are now calls for the disclosure of non-financial
information, such as climate change-related
information and human capital information, and it isclear that corporate governance (CG) efforts areadvancing rapidly. I intend to fulfill my responsibilities
through discussions that contribute to theenhancement of corporate value, while taking note of
the evolving and diverse CG issues, based on myadministrative experience in macroeconomic andindustrial policies.

In corporate governance, I believe thatthe role of outside auditors is to monitor
whether processes are properly
implemented in board decision-making,whether internal controls arefunctioning properly, and whether thecompany is being fair to all
Tomoko Takase
Outside Auditor
stakeholders, including minority
shareholders, employees, and the local
community. To this end, I believe it is necessary to always
listen to what directors and executive officers have to say,and to provide candid opinions from the perspective of
those outside the company as representatives of
stakeholders. As a member of the Board of Auditors, I
would also like to be actively involved in cooperation with
the internal audit department and accounting auditors.
I will strive to fulfill the role expected of an outside auditor
by utilizing my past experience as an attorney-at-law, andwill contribute to achieving of effective corporate
governance and, ultimately, to the enhancement ofcorporate value.

Risk vulnerability

Risk monitoring/review

Risk occurrence frequency

In light of evolving CG, we will deepen the discussion
to contribute to the enhancement of corporate value

Third-party Opinions

Risk Management

R/C (Risk/Compliance) Committee

An Outside Officer’s Perspective

S Society

Risk analysis/assessment
Internal Control
Committee

Risk response/handling
Affecteddepartments

Carrying out risk management
Risk management processes

Responding to COVID-19
The OOC Group has prepared an
infectious disease manual to ensure
the safety of human life, minimize theimpact on business, and restore

The OOC Group’s main measures against infectious diseases
1. Work• Working from home
• Encourage staggered work hours

2. Business trips• Restrictions on domestic business travel• Business trips to plants are generally prohibited• Overseas travel is generally prohibited

3. Meetings and events

4. Health and hygiene management• Hand-washing, sterilization, andmask wearing protocols are enforced

business operations quickly andefficiently in the event of an infectious
disease outbreak.

• Internal meetings and other interactions use
video and web conferencing• Internal seminars, academic meetings, andexhibitions are joined by web conference• Get-togethers involving food and drink are
generally prohibited

30

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Initiatives to Address Climate Change Risks
BCP Initiatives — Fiscal 2021 BCP training (Disaster readiness and business continuity exercises: Desk exercises)
Purpose of exercises
In December 2021, we conducted the “Fiscal 2021 BCP

focused on verifying whether the task force would be able to makeVerification Desk Exercises” with the aim of verifying thedecisions and issue instructions on various problems that would

effectiveness of the Business Continuity Plan (“BCP”) already inarise one after another in the event of serious damage caused byplace at OOC and further brushing up the plan. The exercises

an unforeseen disaster or accident (when the BCP is activated).

Basic Approach

As a chemical manufacturer, the OOC Group takes climate change issues seriously and is proactively working
to address both risks and seize opportunities.
From a long-term perspective, we will also strive to contribute to society and create value by promoting
initiatives to achieve carbon neutrality (to be described later) and to provide information disclosures compliant
with the TCFD recommendations.

Disclosures Compliant with the TCFD Recommendations
In response to risks and opportunities related to climate change,
the TCFD recommendations are recommendations on thedisclosure of information for the following four areas:
Governance, Strategy, Risk Management, and Metrics andTargets.
The OOC Group will strive to win the trust of society andstakeholders by incorporating the climate change-related
initiatives it has conducted to date into a framework based on the
TCFD recommendations and by disclosing information on therisks and opportunities it has analyzed.
Specific details of information disclosure compliant with TCFD
recommendations are available on our website from June 2022.

TCFD disclosure items

Exercise explanation: Threat of Nankai Trough earthquake

Climate change measures being implemented
Decarbonization initiatives (page 34)
Regular monitoring of CO2 emissions is conducted. The
Carbon Neutralization Study Committee set CO2 emission
reduction targets and implemented reduction initiatives.

Governance
How is it studied and managed by the company?
Strategy
What is the impact on corporate management over the
short, medium, and long term?

Risk/Compliance Committee (page 30)
Basic policies, risk identification, assessment,
countermeasures, and monitoring of implementation status are
implemented for business risks, including climate change risk.

Risk management
How is the company trying to identify, assess, and reduceclimate change risks?

Scenarios and situation assignments (various problems to be faced)
were prepared for damage situations, and members of the head officetask force responded to a series of situation assignments.

In order for the task force to make decisions, it is necessary to properly manage
the information that is gathered. For example, the information for each attributeis clearly defined by filling in the information for the task force supplies (poster
board, sticky notes, pens, etc.), people, things (facilities and equipment), andother (supply chain, such as stakeholders and customers, etc.).

A BCP is essential for the survival of a company, and it is important to continue to conduct exercises, educate employees,
and brush up the BCP to improve awareness of business continuity and organizational response capabilities.

Relocation of Head Office — Disaster countermeasures for business continuity are a top priority
The earthquake resistance standard of the building occupied until lastyear was the old earthquake resistance standard applied until May 31,
1981, and this standard did not have any stipulations for earthquakes
larger than 5 on the Japanese seismic intensity scale. If this building werestruck by an earthquake that actually occurs in Japan, the risk of collapse
was relatively high with a level of earthquake resistance that barely
complied with the standard. Also, considering safety in the event of anearthquake, we thought it best to relocate to an office building thatcomplies with the new earthquake resistance standard. Consequently, in
November 2021, we relocated our head office to the Nomura Real Estate
Osaka Building, a property suitable for disaster countermeasures(three-line power receiving system, emergency generator for evacuationand fire prevention equipment, two emergency elevators, etc.) in addition
to meeting the desired earthquake resistance standard.

BCP initiatives (page 31)
A written business continuity plan is prepared for disasters
and other emergencies. Periodic drills and reviews are
conducted in accordance with the business continuity plan.

Metrics and targets
What metrics are used to determine climate changerisks/opportunities and evaluate progress to targets?

Governance and Risk Management of Initiatives in Response to Climate Change
required at that time for a proposal, it is discussed and approved.
New risks are discussed by the Risk/Compliance Committee,
and if deemed relevant to the TCFD, the Sustainability
Committee conducts a scenario analysis and identifies key risks.
The analysis results are reported to the Risk/Compliance
Committee and the Board of Directors. We will continue todisclose information compliant with the TCFD recommendations,along with our efforts to address climate change issues,
including initiatives to contribute to achieving a decarbonizedsociety.

We are developing a governance structure for risks andopportunities related to climate change. The Sustainability
Committee was established as an organization to carry out
initiatives for building OOC resilience. This organization iscomposed of cross-organizational members led by the CEO.
Important matters such as basic policies are deliberated andresolved by the Board of Directors, while other initiatives are
conducted by the Sustainability Committee. The actions of thecommittee include discussions six times a year and reports on
the discussions to the directors twice a year. If discussions are
Governance system diagram

Board of Directors

Earthquake resistance standards
Medium-sizedearthquake(Japanese seismic
intensity 5+)
Large-sizedearthquake(Japanese seismic
intensity 6 to 7)

Old standard

New standard

Does not collapse

Limited to minor cracks

Not specified

Does not collapse

Internal Control Committee

Risk/Compliance
Committee

CEO
AgendaReportManagement Council

Sustainability
Committee

Executive officers, departments, and affiliates
Photo courtesy of Nomura Real Estate Development Co., Ltd.

31

32

CSR REPORT 2022

History and Strengths ofValue Creation

Environmental Initiatives

Initiatives to Build a Decarbonized Society

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Since production activities at chemical plants are the Group’s core business area, environmental protection work
is one of our highest priorities. The OOC Group’s initiatives for the environment include regulatory compliance toprevent environmental pollution, along with other initiatives designed to reduce environmental impact byanalyzing our business conditions and predicting future changes.

Major typhoons, torrential rains, droughts, heat waves and other abnormal weather events have recently been creating
disasters that have incurred major damage around the world. The growing number of extreme weather phenomena
caused by climate change have raised concerns over the risk of shutdowns in infrastructure and other functions, andover potential threats to food safety and security. On the other hand, in October 2020, the Japanese government
declared that it aims to achieve a carbon-neutral, decarbonized society by 2050, and a series of regional and privatecompanies have also declared their intentions, and the government and private companies are now promoting studies
and activities. The OOC Group has recognized the long-term importance of dealing with climate change throughdecarbonization, and is working to help the world transform to a low-carbon economy over the medium term.

Medium-term Policy (2020–2024) Issues

Progress to Date Toward World Transformation to a Low-carbon Economy

Company activities designed for coexistence with the planet and the public

Contributing to a low-carbon economy throughbusiness reforms

Basic Approach• Building global partnerships to enable sustainable development• Managing chemicals and reducing waste throughout product lifecycles• Proactive use of resource recycling and use of renewable energy
Solar panels installed on the roof of the office building
at the Kanazawa Plant

State of Environmental Impact
The OOC Group works to accurately identify how we affectthe environment through our business activities, from raw
material procurement to production, scrapping, and recycling.
We work to reduce environmental impact by qualitatively andquantitatively identifying how much we reduce or reuse theresources we consume and discharge.
Various ESG data is available on our website.
(See URL and 2D code on page 22.)

Raw materials

Water

54,600 metric tons

5.99 million metric tons

Use of natural materials
such as pine and corn
Outsidecompany
Re-refining Collection Reuse

17,287 KL

Electricity

7,548 KL

Heavy oil

5,379 KLNatural gas

4,347 KL

Other

13 KL

(Note: Energy consumption quantities are given
as crude oil consumption equivalents.)

CO2 circulation

Effects of Plan 14

Osaka Office,Kanazawa Laboratory

Effects of Next Stage 10 business reforms
Unit: %

50.0

11.3

10.9
8.0

45.0

• Installation of solar panels on office rooftop• Saving power by updating air conditioners andrefrigeration equipment and reviewing operation• Saving power by switching to inverter-driven facilities/equipment• Simultaneous steam trap inspections• Saving power by reviewing equipment cleaning methods(speeding up processes)

9.0

6.3
40.0

4.2
48.1

35.0

46.1

42.8

45.0

0.0
30.0

2013

2014

2015

2016

■ CO2 emissions• Developing products that help save resources and energy

12.0

47.3 47.0
1.7

2.2

2017

2018

5.0

6.0
3.0

44.3

42.6

45.7

2019

2020

0.0
2021 (Fiscal year)

CO2 reduction rate (based on fiscal 2013)

CO2 emissions and gross profit margin intensity index(based on fiscal 2013)
Unit:
Thousandsof metric tons

Effects of Plan 14
100

50.0

Unit: %• Switching to power lifts

40.0

All offices• Saving power by switching to indoor/outdoor LED lights

35.0
30.0

Compressor upgrade

100

87
75

45.0

Head Office Plant of
Shinko Organic
Chemical Industry

Effects of Next Stage 10 business reforms

67

62

57

75
55

48

42

50
25

48.1

46.1

42.8

45.0

47.3

47.0

44.3

42.6

45.7

2013

2014

2015

2016

2017

2018

2019

2020

0
2021 (Fiscal year)■ CO2 emissions

In fiscal 2021, the supply pressure was reviewed and optimizedin conjunction with compressor upgrades.

CO2 Gross profit margin intensity index (based on fiscal 2013)

Establishment of the Carbon Neutralization Study Committee

OOC
FutureForestprogram(tree planting
initiative)

Shipping

R&D/production activities

Suppliers
Forests

OOC Group

Plastic container/
drum collection

OUTPUT

Production
quantity:

Clients

45,100metric tons

Plastic container/
drum collection

The OOC Group works to reduce the amount of waste andemissions generated by its business activities.

Atmospheric emissions

Emissions to bodies of waterCO245,700 metric tons

COD load

20.3 metric tons

SOX

7.5 metric tons

SS load21.9 metric tons

NOX

16.0 metric tons

PRTR substances

20.1 metric tons

Reuse ofwaste oil
and wastesolvents:
2,200 metric tons

Waste oil, plastic,other waste
Waste discharge

In March 2021, we launched the Carbon Neutralization Study
Committee in order to increase the effectiveness of our goals forbuilding a decarbonized society by 2050. With the Corporate
Planning Division serving as the secretariat, the committee iscomposed mainly of energy-related managers from the
Kanazawa Plant and Shinko Organic Chemical Industry.
Milestones were set for long-term targets, and targets and specificmeasures for fiscal 2021 were proposed at the Management
Council. From now on, we will report as needed at theAmount of industrial 20,900 metric tons
waste generated (20% recycling rate)
Amount treatedin-house

13,000 metric tons
(62% in-house treatment rate)

Amount discharged
externally

7,900 metric tons

Final landfill
disposal amount

170 metric tons
(0.8% final disposal rate)

Management Council on the proposed scenario in accordancewith TCFD and specific measures to achieve the target, and theentire OOC Group will work together to achieve carbon neutrality.
CO2 reduction rate targets to build a decarbonized society
Fiscal 2021
resultFiscal 2022
target5%

13%

Fiscal 2030
Fiscal 2050
Fiscal 2024
(mid-term target) (mid-term target) (long-term target)
15% or more

30% or more

Substantial zero

[Fiscal 2022 Scheduled Initiatives] Energy-saving initiatives, shift to high value-added products. Looking into purchase of renewableenergy electricity. Study on regeneration (refining) of waste solvents and their conversion to fuel.
Preparation for installation of waste oil boilers (conducting of environmental assessment).
Reducing energy consumption
through innovation

Our technology

Business activities

Absorption

Unit:
Thousandsof metric tons

OOC Group’s CO2 reduction measures

EnergyTotal energy

Changes in CO2 emissions and CO2 reduction rate (based on fiscal 2013)

The Osaka Plant was shut down until fiscal 2014 as we worked onrevising or discontinuing a number of products under a business reformproject called Plan 14. The project helped us reduce CO2 emissions andenergy consumption by reviewing products with poor production
efficiency or excessive environmental impact. Next Stage 10 is the nameof our Long-term Business Plan begun in fiscal 2015. It calls for a focus
on electronics materials along with business reforms done throughmeasures such as reviewing unprofitable businesses. It has helped us
curb rising CO2 emissions while boosting net sales and profits.

Kanazawa Plant,
Sakata Plant

The OOC Group works to reduce energy and resource consumption.

Breakdown

INPUT

VOC combustion treatment
equipment
VOC concentration in plants

Reduction of heavy oil consumption
by using waste oil
Consideration of introducing
LNG facilities

Reduction of fossil fuel consumption
through conversion to electricity

2025

Carbon neutral
CO2 recovery fromincinerator and
VOC processing gas

Use of new energy sources
such as hydrogen

Solar power installation
Purchase of green electricity

2020
33

Special Feature:
OOC’s Strengths

Top Message

2030

2040

2050
34

CSR REPORT 2022

History and Strengths ofValue Creation

Initiatives to Reduce Environmental Impact

Relationship with Employees

Promoting Sustainable
Management

Special Feature:
OOC’s Strengths

Top Message

G Governance

E Environment

S Society

Third-party Opinions

We aim to be a company where employees can experience job satisfaction and growth through their work.
Basic Approach

The OOC Group makes efforts to reduce the environmental impact of its business activities, which affect theenvironment in various ways because they consume large amounts of energy, chemicals, water resources, andother inputs.
Our efforts are rooted in environmental compliance work done to enforce compliance with the environmental
laws and regulations of countries and regions around the world. Our employees are trained to understand theimportance of legal compliance through audits and ongoing educational programs. We also communicate
regularly with local residents as a way to consider the local environment.
We had zero major environmental compliance violations in fiscal 2021. We will continue making efforts to protect
the global environment, providing local residents with safety and security.

Reducing Industrial Waste

Recycling rate

The Group works to further reduce environmental impact throughactivities that put the three Rs (reduce, reuse, recycle) into practice.
These activities are designed to reduce the amount of industrial
waste generated while making effective use of limited resources byconsistently sorting generated waste and recycling more of it. We
have always promoted in-house recycling by using byproduct oil
treatment systems to turn waste oil into fuel and waste solvents
into boiler fuel. For fiscal 2021, we are moving forward with plans
to use new waste solvents as boiler fuel, but the recycling rate is
down 1.6 percentage points from the previous year to 19.9% due toan increase in waste oil from external treatment as a result of ahigher than planned increase in waste solvent generation. In the
future, we will continue to study waste oil treatment methods andimplement initiatives with an awareness of resource recycling.

Reducing Emissions of
PRTR-regulated Chemicals

Fiscal 2021 result: 19.9%

Changes in waste data
18,09917,304
15,662

10,000

25.0

21.5
18.8

17.5
5,629

5,959

Good place to work

129
2016

177
2017

143

133
2018

2019

137
2020

170
13.0
2021 (Fiscal year)■ Amount of industrial waste generated ■ Waste discharged externally■ Landfill disposal

Fiscal 2024 target: 60% or more

PRTR emissions (top three substances and total quantity)and emission reduction rate

Unit: %

Unit: Metric tons

80
60
40
20
0
■

4.5

66.1
55.8

35

Promoting strategic mid-career recruitment(digital human resources/global humanresources, etc.)

Creating a workplace
where diverse people canplay an active role

56.4

18.3

18.8

10.4

3.2

26.1

11.5

12.4

12.4

11.8

11.6

14.8

14.3

16.0

2016

2017

2018

4

Diversity

3

Respect for the individuality of each
person (elimination of bias)
Eliminating the gender gap

2

5.1

21.1

20.4

11.6

2.3 11.2
2.1 4.8
2020

0
2019

20.1
2.6 10.6
1.8 5.6

1
3.0
1.0 0

2021 (Fiscal year)

Human resource development/
personnel system
Interviews with younger employees
Evaluation system for development
purposes→ Multiple-track qualification andrank system
Education and training system→ Training by rank
Division-specific Enhanced
Training (starting in 2021)
Selective training (under study)Jobsatisfaction

5

Ease ofworkingWork-life balance
Promoting diversity in work styles

n-hexane ■ Methyl methacrylate ■ Methyl acrylic acid ■ Others
Emission reduction rate (based on fiscal 2019)

Healthpreservation

Health management
Physical health care
Mental health care

Respecting human rights
Combating harassment
Measures to enhance the effectivenessof the whistle-blowing system

Conducting of engagement surveys
hazardous substances. In the future, we will continue tomonitor emission equipment on an ongoing basis and makeefforts to reduce our emissions.

Preventing Water Pollution
The Group’s wastewater treatment processes are continuallymonitored as we work to prevent water pollution by meeting
regulatory values. As part of this work, we make ongoing
efforts to reduce environmental impact on bodies of water by

Improvementof motivation
and ability

Workforce recruiting

Preventing Air Pollution
Preventing air pollution through measures such as
rationalizing the operation of boilers and incinerators has
always been an area of focus for the Group. We are also
working on further reducing atmospheric emissions ofVisualization of work style (job satisfaction index)● The results of engagement surveys (surveys of employee satisfaction) conducted by external organizations are used as KPIs.

Recycling rate (based on fiscal 2015)

Fiscal 2021 result: 4.5%

Health preservation

Reduction of working hours per person

16.0

5,000

0

Improvement of motivation and ability

19.0

7,926

7,452

6,741

6,498

Improvement in job satisfaction

22.0
19.9

19.3

18.9

Priority Strategies: Human Resource Development and Workplace Reform

Unit: %

19,053

17,83515,000Emission reduction rate (compared to fiscal 2019)

Our environmental impact reduction efforts include work on properly
managing chemicals generated by our business activities while
reducing their emissions. As a part of our initiatives, we take part in
the Japan Chemical Industry Association’s voluntary PRTR surveys
and work on reducing environmental chemical emissions. Previous
emissions reduction measures have included upgrading deodorizing
equipment for outdoor tanks and plant facilities. For fiscal 2021, theemission reduction rate increased 1.4 percentage points from theprevious year. We are planning more work on reducing emissions,and are planning to install VOC combustion equipment in fiscal 2024.

20,98720,000

The reform of work styles in the OOC Group is not limited to merely reducing working hours, but aims to increase
productivity as we work to improve the job satisfaction of each and every employee. To this end, we will create a
corporate culture that fosters sincerity, enthusiasm, and creativity by drawing out employees’ initiative andwillingness to take on challenges, and achieve both individual happiness and sustainable growth for the company.

▶ Continuous improvement of job satisfaction• Visualization of job satisfaction and continuous efforts to improve it• Development of an environment in which human resources can play an active role in anticipation of the 100-year
life era and support for second life planning (promotion of diversification of work styles and lifestyles)• Initiatives to establish diverse, flexible, and time-conscious work styles

Fiscal 2024 target: 25% or more

Unit: Metric tons

Basic Approachrationalizing the operation of activated sludge treatment
facilities and wastewater incinerators.
The level is still well below the regulatory value, and we willcontinue to work on reducing it through steady monitoring.

Engagement surveys were conducted twice, once in 2020 and once in
2021. The first survey was conducted, and the results were analyzed andincluded as an action plan in the fiscal 2021 annual action plan to
improve engagement. The second survey was conducted in the middleof the initiatives in fiscal 2021, and the evaluation results were identicalto the first survey, but we continue to periodically confirm that the action
plan is being steadily implemented and review the results, which will leadto the 2022 annual action plan.
Going forward, we will incorporate the results of engagement into KPIs,
study and implement more effective measures, and engage in initiatives
that will lead to higher employee job satisfaction.

A◀

Fiscal 2030
targetB◀

Fiscal 2024
targetC◀

Within the top 10%

Top

Top 10% to 30%
Top 30% to 45%

D

Fiscal 2020,
Fiscal 2021
(current)

Bottom 40% to 55%

BottomE

Bottom 20% to 40%

FWithin the bottom 20%(Note) Engagement: A positive relationship between a company and its employees. By
ensuring that each employee understands the company’s goals, it createswillingness by them to use their own abilities to take action proactively.

36

CSR REPORT 2022

History and Strengths of V
alue Creation

Workforce Recruiting and Training

Creating a Workplace Where Diverse People Can
Play an Active RoleWith the aim of becoming a corporate group that can make a sustainable contribution to the development of society, the OOC
Group has established a Human Resources Policy and is taking various measures for workforce recruiting and training tocultivate a corporate culture where employees can maximize their abilities and where each individual can play an active role.
Human
Resources Policy

As the management of OOC, we believe in and love our employees and will work to eliminate bias andself-righteousness for always supporting those who are willing to take on challenges.

Workforce Recruiting
In our recruitment activities for fiscal 2021 (March 2022 graduates), we held company information sessions and screenings online,
considering the health and prevention of infection of students as our top priority due to the COVID-19 pandemic that began in 2020.
In addition, plant and laboratory tours were conducted at the Kanazawa Plant and Osaka Office during the period when the
pandemic had subsided.
We plan to continue this program in the next fiscal year as well, while confirming the status of the pandemic.

Internships

Participation in on-campus joint company
information sessions

The OOC Group regularly offers internships to applicants
who are keen to know more about working at a chemicalplant. In fiscal 2021, the program was conducted online dueto the COVID-19 pandemic. Despite the short time frame,
many students participated.

In 2021, we exhibited at four schools and were visited bymany students.
Conducted online

3

Conducted
on-campus

schools1

schoolConducting of Interviews with Younger Employees
Support system for creating a pleasant working environment
1. Nakajima Hideji Legal Office
Independent legal
office with no vested
interests in the OOC
Group management▲

Measures for mental
healthCounseling

3. General Affairs
Department▲

Counseling forharassment issues▲▲

Counseling formental health issues▲

Career development
Improving the workplaceenvironment

Internal
consultation
service▲

4. JAICO (Japan
Industrial Counselors
Organization)

Employees

Improving theemployment
environment andconditions
Promoting diversity
Empowering womenin the workplace
Counseling forharassment issues▲ ▲Office forexternal
whistleblowing

2. Japan Institute for
Women’s
Empowerment andDiversity Management

External
consultation
services

Workforce Training through a Multiple-track Qualification and Rank System
At OOC, in order to provide an environment where each employee can maximize
their individual strengths, we have established various career paths. We believe it isimportant to set career paths and raise awareness of career goals, especially fromthe standpoint of diversity.
Therefore, we have set up career training programs that start from the training for
new employees after they join the company and provide training for them to design
their own careers.
Also, to promote diversity in work styles, we also hold exchange meetings to discuss
future work styles, including childcare, nursing care, and nursing.

Enhancement of Education and Training System
The OOC Group provides education and training programs to encourage the challenge of personal growth for developing a group of
professionals with a high level of expertise.
In 2021, we launched the Division-specific Enhanced Training program to incorporate more specialized education and training. In
2022, elective courses will be added to the program to provide an environment where employees can work on challenges forrealizing their future goals.
37

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

The OOC Group is committed to diversity based on the belief that in order to achieve sustainable growth as acompany, the energy of individuals that comes from mutual understanding and respect for each other will foster
organizational strength, which in turn will enable the company to grow together. We are also focusing on
initiatives to enhance work-life balance in order to meet the diverse life stages and career plans of ouremployees.

Initiatives for Diversity

Recruitment activities

The OOC Group engages in business with a respect forhuman rights, and conducts its management based on apolicy of also not infringing on any human rights. As part ofthese efforts, we have set up consultation services bothwithin and outside the company so that employees canfreely and openly consult about any harassment-related
issues they may be experiencing.
In addition, the General Affairs Department conducts
interviews for young employees who have been with thecompany for less than three years, starting six months after
joining the company and continuing regularly.
Since on-the-job training from senior employees is the main
focus during the first six months after joining the company,
once the young employees become independent andimprove their skills as engineers, they often struggle with
anxiety about how to do their job and the mental aspects ofbeing an engineer. We listen to these young employees andoffer advice to help alleviate their concerns.

Top Message

Male employees taking childcare leave

Percentage of male employees taking childcare leave

In accordance with the General Action Plan for the Act on Advancementof Measures to Support Raising Next-Generation Children, we aim toincrease the rate of employees taking childcare leave and leave forchildcare purposes. While the rate of women taking childcare leave hasremained at 100%, the low rate of men taking childcare leave has been aproblem. We have been actively promoting awareness of the program
since 2019, and this leave is now gradually being recognized and taken.

Unit: %

20.0

15.4

15.0

11.1

10.0
4.2

5.0
0

0.0

0.0

0.0

0.0

2015

2016

2017

2018

2019

2020

2021

(Fiscal year)

Initiatives for Work-Life Balance
In response to the diverse life stages of our employees, wehave improved our efforts to enhance work-life balance for
employees who are raising children.
1. Alleviation of concerns about returning to work for those who have taken leave
Previously, the employee and General Affairs Department staff met only once
before taking the leave, and the meeting was mainly concerned with salaryduring the leave and paperwork procedures. Since this did not help to alleviate
the concerns of those taking leave, we changed the interview to a three-party
meeting between the employee, his/her supervisor, and the General Affairs
Department, and included it in the regulations. Interviews are held a total of six
times, before and after the employees took their leave and before and after they
returned to work, to ensure a smooth leave process and return to work.
2. Extended childcare leave (until April 1 after the child reaches 3 years of age)
Previously, childcare leave had been available until the day before the child’s firstbirthday (in cases such as when the child could not enter daycare, the leave
could be extended until the day before the child’s second birthday), but
depending on the month of the child’s birth, it was sometimes difficult to enroll
the child in daycare and the employee was unable to return to work. In the Tokyo
metropolitan area, it is difficult to enroll even 2-year-olds (1-year-olds as of April
1) in daycare, and “enrollment in daycare” has been cited a major barrier toreturning to work. Consequently, now, childcare leave can be extended up to
April 1 after the child reaches 3 years of age.
3. Raised the eligibility cutoff age for work styles that balance childcare and work
Nowadays, men’s participation in housework and childcare is becoming
increasingly important. For this reason, we have made internal improvements sothat not only female employees but also male employees can take action
proactively for balancing work and childcare.
(1) The eligibility cutoff age for childcare leave, reduced working hours, staggered
working hours, and other programs that allow employees to balance work andchildcare has been raised uniformly up to graduation from elementary school. In
particular, the scope of use of childcare leave is not limited to injury, illness, childmedical checkups, and vaccinations, but also allows a wide range of use,
including for absence from elementary school and daycare, school events, andother childcare purposes.

(2) We introduced childcare leave (5 days of special paid leave for childcare canbe taken before the child’s first birthday). Previously, employees could takeonly one day of special paid leave on the day of the birth of a child, but byextending the number of days and the period of availability, we have made it
possible for employees to spend more time with their children for childcare,such as witnessing the birth of a child or accompanying a spouse whenentering or discharging from a hospital.
4. Considerations for pregnant employees
Pregnant female employees and male employees who have a pregnant spousecan take up to 10 days of special paid leave for maternity checkups. Also, aninternal system has been developed that allows pregnant employees to work
shorter hours, staggered work hours, or telecommute, and discussions among
the head of thedepartment, theemployee, and theGeneral Affairs
Department are heldfor enabling a variety
of work styles.

These programs
are posted on thecompany’s
attendancesystem for internal
use and are wellknown to all
employees.

Creating pleasant workplaces

Comments from employees who took thecompany’s first maternity checkup leave
I knew about the system from my supervisor at the time I
joined the company, who explained it to me, but I had no
idea I would be using it so early on. I had just joined thecompany and was not sure if it was appropriate for me touse it, but I decided to take the plunge because the numberof remaining paid holidays was low and my supervisor andcolleagues had recommended it.

Due to the COVID-19 pandemic, I was not able to use thematernity checkup leave I took for its original purposes,
such as for going to maternity checkups with my wife or
attending maternity classes, but I was able to take it for use
when going to and from the hospital and for providing
support when she felt ill. I can say that it was an easy
environment for me to take it because I worked from home alot on a daily basis due to the COVID-19 pandemic. (Laugh)
I would be willing to take childcare leave when my wife
returns from her stay at her hometown to give birth.

Junji Kuroishi

International Business
Department
38

CSR REPORT 2022

History and Strengths ofValue Creation

Respecting Human Rights

Promoting Health Management

Basic Approach

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

E Environment

S Society

Third-party Opinions

Basic Approach

In 2020, the OOC Group prepared the Guidelines for Conduct based on its Management Philosophy and Management
Vision, and has strengthened its efforts to create an effective mechanism to ensure that respect for human rights is observedin the conduct of its business. In our supply chain, we have also established our Purchasing Policy in accordance with our
Guidelines for Conduct, and aim to achieve sustainable development together with our suppliers in order to meet society’s
demands for corporate responsibility and value creation.

At the OOC Group, we believe that the good physical, mental, and social health of our employees is the key to maximizing
their individual abilities and enhancing their creativity and productivity. We have now prepared our Health Management
Declaration to raise health awareness through collaboration among the company, employees and their families, and thehealth insurance union, and to develop into a more vibrant company through our health management initiatives.

Whistle-blowing Regulations: Number of Internal Consultations

Health Management Declaration

Health Management: Mental and Physical Health Support

The OOC Group supports its employees and their families intheir efforts to maintain and improve their health. This is what
led us to make our Health Management Declaration.

OOC conducted stress checks and managed the healthcheckups given to employees using the “Health x Life” healthsupport system for enabling visualization of the company’s healthmanagement.
Employees can now easily receive stress checks at any time via
smartphone. Previously, these were implemented at each office,and so it was not possible to conduct group analysis for thecompany as a whole or for each division. Now, by using thesystem, group analysis can be conducted for the company, eachdivision, and each department, which will lead to improvements inthe workplace environment.
Also, employees can view the results of their own healthcheckups at any time. The system can also be used for personal
input and management of daily life data, such as number ofsteps, exercise, blood pressure, and body temperature, to provide
continuous support for employees’ mental and physical health.

The OOC Group has established regulations regarding whistle-blowing andhas set up both internal and external consultation services. This enables us
to receive consultations from employees and others regarding organizationalor personal misconduct and to strive for early detection of inappropriate
behavior, improvement of self-correction, and securing of public trust.
However, a breakdown of the number of internal consultations in fiscal 2021
showed that 70% dealt with power harassment and interpersonal relations.
Although the training shown to the right, which is aimed at preventing power
harassment, shows the difference between power harassment and guidance
and alerts the participants to be careful in their guidance, we still see cases
where the gap in thoughts and awareness that occurs between supervisorsand subordinates or those around them leads to consultations.
In future efforts, the challenges will be on improving communication skills toconvey thoughts and feelings to each other and on improving the ability toprovide appropriate guidance with respect for others.

Number of whistle-blowing
cases and consultations■ Number of consultations■ Number ofwhistle-blowing cases

7

Most recent initiatives
8

4

4

2
1
2017

2018

1
2019

2020

2021
(Fiscal year)

Whistle-blowing andconsultation incident types (FY2021)

30%
70%

■ Powerharassment andinterpersonal
relationships■ Others

January 2021
Compliance training for all
employees of the OOC Group
January 2021
Training on preventing power
harassment by inviting outside
lecturers (for all managers)
December 2021
Message from the CEO to all
employees regardingharassment prevention
February 2022
One additional office added forinternal consultation services

Message from the CEO (Founding Anniversary Ceremony)
Last year, an educator was found to have engaged inexcessive and inappropriate behavior toward a participant at
an internal training site, which was determined to be power
harassment by the Review Committee.
OOC takes this matter seriously and treats the prevention
and elimination of harassment as a top priority issue. The
CEO gave a message on harassment to all employees at thefounding anniversary ceremony in December 2021.
“Building a Better Company Without Power Harassment”
Six Types of Power Harassment(1) Physical attacks (such as assault and battery)(2) Psychological attacks (such as threats, defamation, insults, and severe verbal
abuse)(3) Segregation (such as isolation, disengagement, and neglect)(4) Excessive demands (such as forcing someone to do something that is clearly
unnecessary or impossible for the job, obstructing work)(5) Demeaning demands (such as assigning work that is unreasonably below theemployee’s capability or job experience, not allowing employees to work)(6) Intrusion upon the individual (such as excessive intrusion into private matters)

Example of “Health x Life” smartphone screen

Please think back once again to see if you yourself have been
engaging in such behavior.
Don’t you gradually come to understand your strengths andweaknesses in the course of your work?
According to a survey by the Ministry of Health, Labour and Welfare,power harassment is more likely to occur at the workplaces with thefollowing characteristics.
(1) Little communication between supervisors and subordinates(2) Overtime work, difficult to take days off
And so, what should we do?
(1) Is the work necessary for business?
(2) Are the words and actions
appropriate?
The most important thing to do if you have a problem with power
harassment or leadership style is to talk to someone immediately. Thiseven includes your supervisor or a person in another department.
Please consult with us. Above all, we do not want to lose valuable
human resources and we want to create a better workplace.

Diversity and Inclusion
Elimination of disability discrimination, better
understanding of LGBTQ+

39

G Governance

Based on our Management Philosophy of valuing the individualityof each person, we promote understanding and accommodating
people with disabilities and LGBTQ+ individuals in order topromote respect and recognition and to maximize the potential ofthese individuals.
The research and welfare wings at the Osaka Office, which
opened in 2020, were designed by incorporating elements ofuniversal design.
Slopes are provided at the entrances and exits, and the pathways
to the cafeteria, restrooms, and changing rooms have flat floors.

CREO entrance, Osaka Office

Universal restroom in CREO, Osaka Office

Fiscal 2022 health management survey
This year, we were recognized as oneof the “2022 Health & Productivity
Management Outstanding
Organizations (Large Enterprise
Category)” under the Certified Health& Productivity Management
Outstanding Organizations
Recognition Program designed by the
Ministry of Economy, Trade and Industry and administered by the
Nippon Kenko Kaigi (Japan Health Council).
Health management initiatives contribute to the reform of work styles
and building of an environment to enhance productivity, which isnecessary to create an organization that supports growth, such as
improving employee health literacy and revitalizing communication.
40

CSR REPORT 2022

History and Strengths ofValue Creation

Special Feature:
OOC’s Strengths

Top Message

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Occupational Health and Safety
Kanazawa Plant

Basic Approach

The main objectives of occupational safety and health are to maintain the safety
and health of employees and to prevent disasters and accidents.
In addition to complying with the Industrial Safety and Health Act and related laws
and regulations, the OOC Group is committed to promoting the health of its
employees. As a result, we are working to improve the health of our employees
and our organizational culture because healthy employees and a healthyorganization lead to higher labor productivity.

Organizational Structure for Occupational Safety and Health(Osaka Organic)

Number of lost time injuries
in the OOC Group3

Fiscal 2021 Safety, Security, and Disaster
Preparedness Training Results (OOC Group)Tokyo Office

Kanazawa Plant

Osaka Office

Sakata Plant

Occupational Health and Safety Organizations
Subordinate organizations and their main roles
Fire Fighting
Subcommittee
Environmental Sanitation
Subcommittee
Health Promotion
Subcommittee
Inspection Subcommittee
Zero Accident Education
Subcommittee

Fire and disaster prevention planning for plants and maintenance and management of
propulsion fire extinguishing systems, fire extinguishers, hazardous materials facilities, etc.
Planning and advice on maintaining the workplace environment, inspection and investigationof safety and health protective equipment, guidance on first-aid equipment inspection, etc.
Planning and promotion of sports events for all employees to participate in for the purpose ofpromoting healthPremises inspection planning, implementation, and follow-up
Assessing and summarizing the status of Zero Accident Team initiatives, planningparticipation in external training sessions, etc.

Head Office
COVID-19 measures (lobby)

Disinfection and temperature check at
reception

COVID-19 measures (meeting room)

Installation of partitions in meeting rooms

Poisonous Materials Handling
Education & Training
Carrier Education & Training
Static Electricity
Education & Training

●
●

●

●

●

●

Evacuation Drills●

Firefighting Drills

●

●

●

Emergency Response
Test (Odors, leakage, fires,
polymerization hazard, etc.)

●

●

●

Fire Fighting Equipment Education& Training (Fire hydrants,
automatic fire alarms, etc.)●

High-Pressure Gas
Education & Training●

In addition to a large fire truck with water spraying capability, a multi-functional fire truck was
newly added (left photo above), and firefighting drills were conducted by the company firefighting
team.

Comprehensive disaster drills are conducted to assign theassembly sites in case of an emergency and to give instructions on
how to respond quickly, as well as drills on evacuating to the roof ofthe manufacturing site offices in case of a tsunami or other disaster.

Materials, equipment, and supplies

Broadcasting equipment

All treatment equipment is centrally managed in the plant in case of any disasters or emergencies.
In addition, stockpiles of drinking water, disaster food, blankets, and other supplies are stored foruse in the event that employees have difficulties returning home.

Reviewed on-site broadcasting equipment and installed speakers
at various locations (17 locations in the plant, 2 locations in thewelfare wing, and 7 locations in the research wing) so thatbroadcasts can be heard throughout the entire plant.

Health & Hygiene
Education & Training●

Risk Assessment
Education & Training
Emergency/First Aid/Protective
Gear Education & Training
Education on Carcinogenicity
Guidelines
Health Risks from
Chemical Substances
Terminal Recovery Training

COVID-19 measures (offices)

Installation of partitions in offices●●

Sakata Plant●

The Sakata Plant prepares an annual security management plan and conducts various education and training sessions such as firefighting drills and
4RKYT (four-round hazard prediction training). Also, through monthly health and safety meetings, we uncover near-misses and share information on
new raw materials and equipment, and through risk assessments, we eliminate sources of danger to create a safe and secure environment.
COVID-19 prevention measures

Firefighting drills

●
●

Lobby
●
●

Meeting room

●
●

●
●
●

Safety and HealthTraining for Brushcutter
Operators

Carbon dioxide densimeter

Lobby: Temperature check and hand sanitizers for visitors, Meeting rooms: Partitions installed in meeting rooms
Carbon dioxide densimeters: Carbon dioxide densimeters are installed in meeting rooms, cafeterias, and offices
to serve as a guideline for ventilation.

Firefighting drills are conducted each shift,including regular work

Leakage control drills

Heat stroke prevention measures●●●

Welding Fumes Education& Training

Disinfection and temperature check at
reception

General disaster preparedness drills●●

Prevention Regulations

Tokyo Office
COVID-19 measures (lobby)

Firefighting drills

Kanazawa Sakata Osaka Shinko
Plant
Plant Office Organic

Administration Division

Head Officeuse equipment. Also, issues raised during each training session are discussed for improvement, leading to a review of the facilities.

(Dec. 2020 to Nov. 2021)

Period covered: December 2020 to November 2021

CEO

Recognizing that fires in chemical plants are different from general fires, we are enhancing education on our fire extinguishing facilities and how to●Training in Handling Fire
Extinguishing Equipment●

Fire Fighting Equipment
Education & Training(Chemicals fire truck)●

Mineral water installed at
production plants to prevent
heat stroke

Leakage control drills are conducted each shift, including regular work

Shinko Organic
COVID-19 measures

Heat stroke prevention measures

Lighting

Osaka Office
COVID-19 prevention measures

Brushcutter operator training

Cafeteria menu

(1)

Conducted COVID-19 vaccinations and thesecond consecutive year of flu vaccinationsin the workplace

41

Provide training for workers who mow thegrass at worksites

Healthy menu
options areavailable inaddition toregular meals

(2)

(3)

(1) Hypochlorous acid water sprayer installed in meetingrooms for space sterilization(2) UV air purifier installed for bacterial and virus removal(3) Monitoring ventilation rate with CO2 meter

Heat shielding paintHeat shielding sheet

Reducing the risk of heat stroke by using heatshielding materials

Outdoor worksite

Warehouse

Installation of LED lighting fixtures for compliancewith illuminance standards

42

CSR REPORT 2022

History and Strengths ofValue Creation

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

Relationship with the Local Community
Sakata Plant

Basic Approach

The OOC Group prioritizes practicing safe business operations and achieving a harmonious and prosperous
coexistence with local communities, while also accelerating initiatives to lessen the environmental impact of ouractivities. We are also aiming to make the OOC Group business offices places that are trusted by the local
community, by organizing various social action programs with residents and through other initiatives.

Kanazawa Plant

OOC Future Forest program
OOC Future Forest program (volunteer program byemployees and their families): Ten employees andeight family members (including children)
participated in this program to fertilize seedlings.

OOC participated as a lecturer in a career guidance
session that provided students with an opportunity to think
seriously about their own future and how to live their lives.

Blood donation drives

Donated 10,000 masks to Hakusan city

We participated in the blood donation drives of the
Ishikawa Red Cross Blood Center, and 55 people
donated blood at our plant, more than double thenumber of last year. We will continue to cooperate withblood donation drives to save the precious lives of those
who need blood transfusions due to illness or injury.

We donated 10,000 non-woven masks to Hakusan
city as part of COVID-19 prevention measures. Asa corporate citizen, we will continue to contribute to
the local community in any way we can.

Kanazawa Plant(including the Kanazawa Laboratory)● Location: 1600-1 Matsumoto-machi,
Hakusan-shi, Ishikawa● Established: June 1981
● Employees: 235 (as of November 30, 2021)● Main products: Semiconductors materials,
coatings and adhesives
materials, resin raw
materials, etc.

A hybrid office functioning as a West Japan distribution center and information-intensive laboratory

Cleanup andweeding activities
are conductedaround office sites.

Participated in the “Adopt Program” supported by the Beverage Industry Environment Beautification
Association and conducted cleanup and beautification activities around the plant (September 13, 2021). We
also participate in the Shonai My Road support project every year for planting trees. In April, beautiful
daffodils bloomed on the road next to the plant.

Provided career guidance at Ishikawa
Prefectural Technical High School

Established in 1961, the Osaka Office is the oldest among the OOC Group offices. It began
operations as the Kashiwara Plant, and has built up the management base of our company.
Boasting a site area of 27,000 m2, the Kashiwara Plant had as many as 140 employees, but asother plants were built, the plant transitioned from a production base to a distribution center. As partof manufacturing base reallocation plan “Plan 14,” completed in 2014, the Kashiwara Plant was
renamed the Osaka Plant, and then subsequently the Osaka Office, which is the current name.
This office has been functioning as a chemicals production base, with reliable and comprehensive
systems in place for safety and the environment. As per the reallocation plan, we have recently
removed old equipment at the Osaka Office. This has dramatically decreased the amount of
hazardous materials handled, and provided further assurance of its safe and eco-friendly
operations. We will continue to develop and operate the Osaka Office as a hybrid office functioning
both as a distribution center for West Japan, and as an information-intensive laboratory.

43

The OOC Group started operations at the Sakata Plant in July 2000 as its third plant. Overlooking Mount Chokai, which is also called the
Dewa Fuji, and located in the Shonai Plain fed by the Mogami River, the industrial park is situated on stable ground with little risk of natural
disasters, and aims to be a forest plant that coexists with the local community. As a chemical manufacturer, we implement safety-first
production initiatives while being conscious of reducing our environmental impact and saving energy. Furthermore, we are committed to living
in harmony with the local community and participate in various social contribution initiatives to deepen our interaction with the community.

Reducing the environmental impact and improving the safety of our operations at this main plant

The Kanazawa Plant began operating in 1981 as the OOC Group’s second factory, and since then it has developed to become our main
plant. The Kanazawa Plant faces the holy mountain Mount Haku, and effectively uses the precious resource of groundwater from there
in its production activities. We use the plant’s state-of-the-art technology to carry out business activities that contribute to society.
We are also actively moving forward with a range of initiatives for achieving sustainable manufacturing that is energy efficient and eco
friendly. These include improving production processes, installing energy-saving equipment, and using renewable energy sources.
Additionally, through organizing and taking part in various community social action programs, Kanazawa Plant employees are
establishing closer ties with local residents.

Osaka Office

Production that also values precious natural capitalFire hydrants have been installed that can be used
for fires not only for offices but also the nearby area.

Participated in the “Beautiful Yamagata
Sea Cleanup Campaign” organized by
the Yamagata Prefecture Environmental
Conservation Council, and conductedbeach cleanup and training on
microplastics in the sea at Ohama
Beach in Sakata city. (October 30, 2021)

We participate in the annual
beach cleanup in the Hattori Koya
area of the town of Yuza. We
started early in the morning andcollected a truckload of trash.
(July 4, 2021)

Donated 4,000 non-woven masks
to the town of Yuza (November 25,2021). These masks are effectively
utilized in hospitals and various
facilities.

Head Office Plant of
Shinko Organic Chemical Industry● Location: 18-8 Katayama-cho,Kashiwara-shi, Osaka● Established: July 1961
● Employees: 53 (as of November 30, 2021)

We conduct joint firefighting drills in cooperation
with nearby offices and give lectures at local
disaster prevention council meetings on the casestudies of storm surge flooding that our company
has experienced.

● Location: 157-23, Shigerimatsu, Fujisaki,
Yuza-machi, Akumi-gun,
Yamagata● Established: July 2000
● Employees: 40 (as of November 30, 2021)● Main products: Patterning materials forliquid crystal displays,
cosmetics materials, coating
resin raw materials, etc.

Small steps towards becoming a safe and state-of-the-art
chemicals manufacturing plant

The Shinko Organic Chemical Industry Head Office Plant began operating in 1969, as
an acetic ester production company. It is distinctive for being conveniently located in acoastal industrial zone, which is useful for sea freight, and also for manufacturing
cutting-edge chemicals used in semiconductors and other applications.
Having experienced the Great Hanshin-Awaji Earthquake in 1995, we have beendeveloping and implementing disaster-preparedness measures at this plant. As there
has been increasing wind- and water-related damage caused by large and powerful
typhoons in recent years, the employees here are very aware of the disaster risks thatcome with a plant located along the coastline. So all employees are earnestly taking partin disaster-preparedness activities, both within and outside the plant. We will continue toensure the steady supply of chemicals, and safe operations as a plant handlinghazardous materials.

Osaka Office(including Osaka Laboratory/Advanced
Technology Research Institute)

Sakata Plant

Shinko Organic Chemical Industry Ltd.
● Location: 18-26 Sumiyoshihama-machi,
Higashinada-ku, Kobe-shi, Hyogo● Established: April 1969
● Employees: 44 (as of November 30, 2021)● Main products: Solvents for electronics
materials, cosmetics
materials, solvents forcoatings/adhesives, etc.

Disaster relief vending machines
have been installed under a disaster
relief agreement with a bottlingcompany.

44

CSR REPORT 2022

History and Strengths ofValue Creation

Stakeholder Engagement

Third-party Opinions

Basic Approach

Through constructive dialogue with our stakeholders, the OOC Group will work together to create a sustainable
society where the children of the future can live happily.

Stakeholder Engagement Initiatives
Stakeholders

Main methods and opportunities for dialogue

Main dialogue contact

Clients● Daily sales initiatives● R&D/quality meetings: 4 to 5/month● Quality audit: About 1/monthBusiness Operation Division
Quality Assurance Office

Trading partners● Daily procurement initiatives● Supplier audit: About 1/month● Technical and quality meetings: 1 to 2/month● Safety seminar (for logistics companies)
Kanazawa Plant, Sakata Plant, Osaka Office: 1/year each

Purchasing Department
Engineering Department
Quality Assurance Office
Logistics Department(Transportation)

Shareholders andinvestors● General meeting of shareholders● Briefings for individual investors in Osaka: 1/year● Briefings for institutional investors in Tokyo: 2/year● ONE-on-ONE meetings: 30 to 50/quarter● Business Report/Annual Securities Report

IR & PR Group
Corporate Planning Division

Employees● Employee engagement surveys: 1/year● Interviews with supervisors: 6/year● Interviews with employees who have been withthe company for three years or less: 1/year● Internal newsletter: 3/year (2021)

General Affairs Department
Corporate Planning Division

Local communities● Participation in community groups and events:
2 to 3/month● Joint research with universities: 3 topics● Dialogue with students: 4/year

Production plants & offices
R&D Division
Business Operation Division
and Corporate Planning Division

Lecture at a University: Some Things Can be Gained from Failure (Hokkaido University)
At the request of the university, we have been teaching (credit: 1) as a visiting associate professor at the Graduate School of
Hokkaido University since 2018. We teach the classes “Fundamentals of Polymer Chemistry Using Electron Theory” and “Acrylic
Materials Around Us Based on Published Patents.” Also, in order to encourage researchers to be resilient, we ask them to research
inventions born from failures and submit a report on the necessary qualities for researchers. In their reports, the students gave
various examples, including microwave ovens, penicillin, Viagra, minoxidil, conductive polymers, and mass spectrometry of proteins,and also wrote about the importance of observing carefully, thinking about why things go wrong, and being curious in their daily
research. In addition, during the waiting time after lectures, we offer individual research consultations to students.

Lecture at a University: Thinking about Sustainable Society (Doshisha University)
The topic of the lecture was “Thinking about a Sustainable Society through CSR Reports.” We
introduced our concept of “sustainability” using our company’s CSR Report as a case study,
and discussed the difficulties and challenges involved in getting the report published. In thegroup discussion, participants discussed the topic of “Future Vision and Expected Role ofChemical Companies in a Decarbonized Society” and made group presentations at the end of
the session. They were also asked to write a report on the topic, “What Kind of Future Do You
Foresee in 2050, and How Will You Contribute to Building That Future?” for submission later.

Top Message

Special Feature:
OOC’s Strengths

Promoting Sustainable
Management

G Governance

E Environment

S Society

Third-party Opinions

In preparing this fiscal year’s CSR Report, the OOC
Group requested the Institute for Environmental
Management Accounting (IEMA) to evaluate its CSR
management activities, and we subsequently
received an independent opinion from the IEMA.
Katsuhiko Kokubu, professor at the Kobe University
Graduate School of Business Administration, andEriko Nashioka, a certified public accountant,interviewed Director Tetsuya Watanabe, General
Manager of Corporate Planning Division of OOC,
about the OOC Group’s CSR activities listed in thisreport. Also, a Q&A session was held with theemployees in charge of CSR at the OOC Group.
At that time, we explained the positioning of thisyear’s CSR Report based on the future schedulewith an eye to the integrated report, summarized lastyear’s CSR activities and explained theself-evaluation. Then, there was a lively
question-and-answer session on internalmanagement and future issues regarding the value
creation model, carbon neutrality, disclosure incompliance with TCFD, materiality, and KPIs.
Using information obtained in the interview and Q&A
session, we received a written independent opinion
from the IEMA, containing a general evaluation of
our CSR activities and relevant advice.

In Response to the Independent Opinion
This is our third year of publishing the CSR Report, and we believe that we have gradually been able to communicate the OOC
Group’s top management’s approach to compliance and the desire to value the individuality of each employee, as stated in ourManagement Philosophy. Going forward, we intend to demonstrate in concrete terms our investment in human resources, including
education, in order to increase our appeal to investors. For materiality judgments, we have been
actively working toward solutions. However, we did not mention the relevance of social issues or
conduct periodic reviews in response to changes in the social environment. In this year’s report, wewant to explicitly include society’s expectations of OOC in our materiality so that we can moreclearly demonstrate our fulfillment of social responsibility even more than before.
We are also well aware of the need for meaningful information disclosure in compliance with the
TCFD, rather than a formalistic response. Since we are actively working to achieve carbon
neutrality, we will disclose our efforts in a manner that will help everyone understand our approach,along with our stance on climate change.
Our OYPM initiatives, with a goal of us becoming the cleanest plant in Japan, have already takenroot in our corporate culture over the 29 years since the start of the initiatives. This corporate
Tetsuya Watanabe
culture is one of the strengths behind our current strong performance and has contributed greatly to
Director, General Manager of
earning the trust of our customers. We would like to actively communicate these unique strengths
Corporate Planning Division
Osaka Organic Chemicaland link them to expectations for our company going forward.
Industry Ltd.

The participating students reported on their expectations for chemical companies to contribute to carbon neutrality and what they cancontribute to society themselves, providing an opportunity to raise their awareness as members of a society that aims for sustainability.

45

46

We lead the world with specialty acrylates

Osaka Organic Chemical Industry Ltd.
Inquiries: Corporate Planning Division, Management Strategy Department
11F Nomura Real Estate Osaka Building, 1-8-15 Azuchi-machi, Chuo-ku, Osaka 541-0052
Tel: +81-6-6264-5071
https://www.ooc.co.jp/en/