GENREPORT 2023

STR
Q
SOC

REPORT 2023

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

3

ESG report

Transparency, commitment, competence, global sustainableapproach, and a holistic way to manage the business are the main
characteristics of Tsubaki Nakashima.
During the last 3 years (that is, in the period of validity of our2021 – 2023 Mid-Term Strategy).

TRANSFORM
NEXT 2023

we have strengthened the organization, trained, involved, raised
awareness, and linked our people to a profoundly sustainablevision, adhering to specific and rigorous international models whichhave been and will be our guide in the years to come.
The Sustainability Management System has given us discipline andmethod, the commitment of the management and our factories
has generated results that have gone beyond expectations and theCO2 reduction plan.
Now we look to the future in a much more organic way and with the
optimism that we have seen a great cultural change and extremely
encouraging results; our commitment is to ensure that the plan
designed, and which reaches 2030 is simply implemented. This way
we can say that we have truly done our part to make the world
more sustainable.

environmental social governanceIntroducing

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED

Introducing

NOTE

5

ESG report

For Tsubaki Nakashima that Statement coincides with the ESG
Report and represents the result of the commitment to notify
its stakeholders of the performances and results achieved ingeneral and in the sustainability area. The Statement contains
data and information referring to Tsubaki Nakashima Co. Ltd. andits subsidiaries as of December 31, 2023 (hereinafter “Tsubaki
Nakashima” or “TN”).
THE REPORT IS BASED ON A MULTI-STAKEHOLDER APPROACH
involving the joint analysis of actions taken in respect of the mainstakeholders with whom the Company interacts. For the details on
the material topics, see the speciﬁc paragraphs.
The Report, drawn up in the first quarter of 2024 and for some specificareas (for example, the organizational structure communicated at
the end of 2023 and operational from 1st January 2024) describes
the 2024 status since if this were not the case it would risk reporting
obsolete information and not useful for readers
The Report has been prepared in accordance with the Sustainability
Reporting Standards of the Global Reporting Initiative (GRI) andwith the Japanese Guidelines (Security Report 2023).

environmental social governanceIntroducing

The Sustainability Report
is drawn up according to asystem of indicators (KPI Key Performance Indicators)
whichmeasurethe
Company’s performance andthe degree of achievementof objectives previously
established for areas inwhich the Company has
major impact.

The strategic decisionsof the Company
The establishedshort-medium
and long-term targets
The analysis of the GRI’s
most recent Standards
The Stakeholders’
inputsThe Continuous
Improvement activities

GRI
202

Market Presence
2016

GRI
404

Training
and Education
2016

GRI
203

Indirect
Economic Impacts
2016

GRI
405

Diversity andEqual Opportunity
2016

GRI
204

Procurement
Practices
2016

GRI
406

Non-discrimination
2016

GRI
205

Anti-corruption
2016

GRI
407

Freedom of
Association andCollective
Bargaining 2016

GRI
206

Anti-competitive
Behavior 2016

GRI
408

Child Labor
2016

SOC

GEN
STR
Q

GRI
301

Materials
2016

GRI
409

Forced orCompulsory
Labor 2016

GRI
302

Energy
2016

GRI
410

Security Practices
2016

GOV

GRI
303

Water
and Effluents
2018

GRI
411

Rights ofIndigenous
People 2016

SUST

GRI
304

Biodiversity
2016

GRI
413

Local
Communities
2016

GRI
306

Waste
2020

GRI
414

Supplier Social
Assessment
2016

GRI
308

Supplier
Enivornmental
Assessment 2016

GRI
415

PublicPolicy2016

GRI
2

GeneralDisclosures 2021

GRI
401

Employment
2016

GRI
416

Customer
Health and
Safety 2016

GRI
3

Material Topics
2021

GRI
402

Labor/Management
Relations
2016

GRI
417

Marketingand Labeling
2016

GRI
201

Economic
Performance
2016

GRI
403

Occupational
Health and
Safety 2018

GRI
418

CustomerPrivacy
2016

SOC
SUPP
IND
CRED
NOTE

7

Precision
for a changing andsustainable world
Tsubaki Nakashima is a manufacturing company that operates
on three continents (Asia, Europe and America) and is strongly
committed to serving its customers, creating a work environment
in which its employees can feel motivated, respectful of available
resources and environment, which does its part every day tocontribute to a truly sustainable future; this way of being and acting
is fundamental to the success of our 21 plants, in the countries andcommunities in which we operate.
We are a manufacturer of precision balls, rollers, ball screws
and blowers, very high precision components for the metrology
sector but also of medical devices with regional production andprocurement, short lead times and accurate, through a networkof production and well-organized sale that meets the needs of ourcustomers.
Considering that 2023 is the final year of the Mid-Term Strategy
2021- 2023, we can say that in these 3 years the company has beenredesigned, and that the strengthening of the Asian market also
in terms of footprint (I recall here the construction of a second,modern and sustainable factory in India and that of a new factoryin Thailand), the new presence in the Medical Device Businesssector in Europe with the acquisition of Rispa in Italy, and theremodeling of the Rollers Business, with the closure of 2 factories
in the Netherlands and the quadrupling of that in Bosnia, have fully
fulfilled our commitments, all with truly exemplary attention to thesustainability of processes, products and future profits.

The five pillars of our management style, which we call the Management
Principles, remain the same

Sustainability, as the simultaneous achievement of economic
prosperity, creation of a healthy, safe, and low environmental impact

environment, where everyone is equal, with equal rights and duties, equal
opportunities. In our vision, ZERO impact, in a holistic sense, is fundamental:
Vision Zero for us means zero accidents, zero damage to people andenvironment, but also zero inequalities and zero lack of knowledge, equal
opportunities for our employees.

QCDS

The highest(Quality, Cost, Delivery, and Service), to be thebest-in-class, customer and market-oriented partner for our customers, bycontinuously improving products, processes, and services.

One
Team Spirit, which is the basis of our corporate culture, of
our corporate identity, which in 2023 was effectively strengthened with a

GEN
STR
Q
SOC
GOV
SUST

new brand identity that allowed all of us and our stakeholders to identify
ourselves and identify Tsubaki Nakashima as a strong company, with a strong
image and clear ideas.

SOC

Transformation

SUPP, that is, being more and more a global company
with an international mentality every day, precisely by continuouslytransforming our organization to always be one step ahead, capable ofseizing opportunities to be better, stronger, and more aware

GrowthThe orientation towards continuous, in terms of commercial
solidity and profit, to anticipate market needs, satisfy customer expectations,find new customers, new markets and new business opportunities

CEO letter

IND
CRED
NOTE

9

Precision
for a changing andsustainable world
As Tsubaki Nakashima, we are aware of the responsibility we have towards
the people who work for us and the world around us.

GENThis is why in 2023 we worked hard for sustainable development that willallow us to improve the performance of our plants, in all respects; and weachieved all the CO2 reductions’ targets set up in 2021.

This tells us that we are on the right track and how much effort we
will put into achieving excellence.

The Sustainability Committee has not only defined the strategies andguidelines for sustainable development but has also worked with ALL ourplants on energy efficiency plans, better use of resources, respect for theenvironment, reduction of environmental impacts.

We believe that transparency, openness, and risk management, as
well as the efforts we are making to transform our Company willallow us to be stronger, to protect and improve our company’s
reputation, boost our competitive advantage, uncover risks andopportunities, and track and benchmark progress.

Our Sustainable Development Model, developed in 2021 and based on
three fundamental pillars - Integrated Governance System; Sustainable
Monozukuri; Communication and Brand identity - has begun to unfold allof its enormous potential in its true meaning and if on the one hand it has
consolidated the foundations of Corporate Governance, on the other it has
allowed us to set the cornerstones on which industrial and on processes.
The new Carbon Footprint (set up in 2022 and based on Science Based
Target Methodology), helped us to identify the opportunities in terms ofinnovative technologies and energy purchasing and at developing a specific“Green Electricity” and “Waste recycling” Strategy, successfully applied in
2023.
Obviously, our commitment will continue in the next years, but we are
extremely confident that the 2030 target (CO2 reduction) will be achieved.
An important element that measures the results achieved, in addition to the
KPIs that we will see in this Report, is the company’s decision to disclose our
impacts on the environment and natural resources and take action to reduce
negative impacts through the CDP.

Tsubaki Nakashima reiterates its support for the United Nations
Sustainable Development Goals (SDGs) and our environmental
sustainability goals are in line with global sustainability targets(Paris Agreement)
A clear strategy, a deep and convinced commitment to achieving it,
the results of our actions and the increased trust of our stakeholders,combined with our daily commitment, the work of our women andour men will not only allow us to overcome the adversities of theseyears, but will create the conditions for responsible, sustainable
and profitable development.
Director and Representative Executive Officer, CEO
Koji Hirota

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

11

BUILDING THE

TRUST OF OURSTAKEHOLDERSMISSION
the WHY+
VISION+MANAGEMENT
the WHAT

PRINCIPLES
the HOW=TN POLICYACTION!

GROWING AND THRIVINGWITHIN OUR
COMMUNITIESAND HELPING TO
CREATEA MORE SUSTAINABLE

OUR

WORLD

MISSION

ACHIEVEOUR

VISIONAND

PROFITABLESUSTAINABLE GROWTH

WITH AN UNWAVERING COMMITMENTTO IMPROVEMENT, PRODUCTAND CREATING EXCELLENCESHAREHOLDER VALUE

WITH AN INCREASING DEDICATION TO

SUSTAINABILITYWITHIN ITS LEADERSHIP, OPERATIONS,EMPLOYEESAND INVESTMENTS.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

13

We will TRANSFORM our Company on a
CONTINUOUS basis to make the best productsin the world, in a SUSTAINABLE WAY.
We aim to become a TRULY GLOBALCOMPANY with an international mindset,
deeply TRANSFORMING our organization tostay one step ahead of the curve.
We aim to be a Company that continues
to achieve SUSTAINABLE AND PROFITABLEGROWTH.
We will create a team world-oriented
culture - ONE TEAM SPIRIT - convinced that
the VALUE of our people is the sum of their
COMPETENCES, HUMILITY AND ABILITY toachieve results, with POSITIVE ATTITUDE.
With our creativity we will PROVIDE OUR
CUSTOMERS WITH HIGHEST QCDS (quality,
cost, delivery, service), drawing ideas fromour stakeholders.

MISSION
the WHY+
VISIONthe WHAT+MANAGEMENT
PRINCIPLES
the HOW=TN POLICYACTION!

PROFITABLE AND SUSTAINABLE VALUEOPERATIONAL EXCELLENCEGROWTHGLOBAL REACH, LOCAL DEPTH
BEST IN-CLASS TRANSFORMATIONDX TRANSFORMATION

TRANSFORMATIONCOMPLIANCE
VISION ZEROSUSTAINABILITY
MARKET ORIENTEDCONTINUOUS IMPROVEMENTQCDSTN CULTURE
V = [C2+H+A] x A

ONE TEAM

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

15

TSUBAKI NAKASHIMA Policy
represents the actions we’ll taketo ensure our Vision, Mission
and Management Principles are
executed: aligned around People,
Planet and Prosperity, we’ll continue
to measure our performance andimprove all aspects of what we do.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
[ Koji Hirota • President and CEO ]

NOTE

17

COMPANYPRESENTATION
Tsubaki Nakashima is a global Company producing a broad range ofhigh-quality industrial precision balls, rollers, cages, and sheet metalparts used for bearing and other applications. Tsubaki Nakashima
is a known brand in Medical and Hygiene equipment and Ceramicbusiness. We strive to constantly increase the quality of our
products and achieve zero defects. In refining our manufacturing
processes, we have developed in-house both proprietary grinding
machines to achieve sphericity and our own inspection machines toensure consistent quality for our customers.

GEN
STR
Q

COMPANY STRUCTURE
Tsubaki Nakashima Co. Ltd. is headquartered in Katsuragi, Nara
- Japan, with offices in Osaka, Singapore, and 21 plants in 11
Countries: Japan, Italy, Poland, Slovakia, UK, Bosnia, China, Thailand,
India, Taiwan, and United States as of January 1st, 2024. This
enables Tsubaki Nakashima to respond to various Customer needs,
local procurement, quick delivery, and superior Customer support.

SOC
GOV
SUST

The following are some key facts about the company
Company name: Tsubaki Nakashima Co., Ltd.
Stock exchange listing: Tokyo Stock Exchange – Prime Market
Total number of issued shares at the end of the period(including treasury shares): December 31, 2023: 41,599,600 shares.
Code number: 6464
URL: http://www.tsubaki-nakashima.com/en/
Representative:
Koji Hirota, Director and Representative Executive Officer, CEOContact:
Hisashi Tate, Director and Executive Officer, Senior EVP, CFO
The corporate structure of the company is made up of a high-levelcompany organized by a Board of Directors made up of 7 members
and by a Management Committee (made up of 6 members).

SOC
SUPP
IND
CRED

Who we are

NOTE

19

1934
Foundedby Kosabuto
Chikamori,Toyo Steel Ball
Seisakusho started
manufacturing steel
balls for bicycles.

1939/1941
Launched as a

joint-stock company
as Toyo Steel Ball
Manufacturing
Co. Ltd., began
manufacturing
and sale of chrome
steel balls, thecornerstone of steel
balls for bearings.

1959/1961
Started manufactu-

ring and sale of ballscrews. Went public
on the OTC market
in Osaka. Listed on
the second sectionof both the Tokyo
and Osaka Stock
Exchanges.

1973
StartedOUR
HISTORY

manufacturing
and sale of ceramicballs, using sphericalsurface processing
technology.

GEN
STR
Q

1988/1990
Acquired Tsubaki

Steel Ball Co. Ltd. inJapan, and the assetsof Hoover Group’s
steel ball divisionin the United States
Listed on the firstsection of both theTokyo and Osaka
Stock Exchanges.

2002/2006
Established Taicang
Plant in China,acquired Krasnik
Plant in Poland
and Chongqing
Plant in China.

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

21

2010/2013
Established Taiwan

Plant, India Plant
and acquired United
Kingdom Plant
and Thailand Plant.

2015
Opened Osaka

Office as a groupheadquarter in Japan.
Established Korea
Distribution Center.
Re-listed on the firstsection of the Tokyo
Stock Exchange.

2020
ReleasedOUR
HISTORY

Sustainability
Report(current ESG Environment Social
Governance Report)
for the first time.

GEN
STR
Q

2021
Certified

IATF 16949.
Establisheda Sustainability
Committee tobecome a sustainable
and profitablecompany.

SOC
GOV
SUST
SOC
SUPP

2017
Acquired Precision

Bearing Components
Group of NN Inc.
(7 plants).

2022
Transferredto the Prime
Market of Tokyo
Stock Exchange
and obtained
the first CDP(Carbon Disclosure
Project) score.

IND
CRED
NOTE

23

GEN
STR

FROM NOW ON
WE DRESS
LIKE THIS!

Q
SOC
GOV
SUST
SOC
SUPP
IND

2023

new brand

CRED
NOTE

25

When we began the journey to build a new Tsubaki Nakashima
in 2018, we began by defining the vision, mission, values, andmanagement principles, we defined an organization based on
skills and independent of the nationality of its members, wedefined its rules of operation (Corporate Governance), we wrote
the Management Systems, we introduced the IT platforms.

One of the 3 Sustainability related pillars of our Transform
Next 2023 Strategy is the Communication, specifically Internal,
External and Institutional Communication.

The final step was to work on the identity and on the brand, as anelement to seal the change and to further define common ground

Zero Accidents, Zero Occupational Illnesses, Zero Waste,
Zero Inequalities, Zero Lack of Knowledge

VISION ZERO

GEN
STR

CommonPrinciples
andValuesINTEGRATEDCORPORATEGOVERNANCE
CommonRules

INSTITUTIONAL
EXTERNAL
INTERNAL
TN ACADEMY

CommonIDENTITY
Common
PLATFORMSUSTAINABLE
DEVELOPMENT

CommonSystems

G M C

GOVERNANCEMONOZUKURICOMMUNICATION

Q
SOC
GOV
SUST
SOC
SUPP
IND

For us, Corporate identity is
how Tsubaki Nakashima presents itself to internal stakeholders (including all
the employees, investors, and partners of the company) and external stakeholders(including customers, consumers, media, etc.) and
how Tsubaki Nakashima looks,
behaves, and communicates2023

new brand

CRED
NOTE

27

But a new Brand Identity is not
only the logo, but much morethan that: it is a way of acting,always, of presenting one’s
company on every occasion, of
making it visible to everyone,of “dressing” people andthe factories themselves ina new, fresh, modern dress.
It is a system of rules thatconcern many aspects, fromthe way to use the logo to theuniforms, from business cards
to the backgrounds to be usedin conference calls (the Brand
identity Guidelines) but also
how to design workspaces,
factories (the so-called Plant
Identity), to finally arrive at
our Website and the creationof a common platform (Global
Intranet) that would collect
the rules, systems and tools.

Corporate
communicationand genesisof the new logo
The concepts that give birth to the new identity.
The core of the company is the manufacturing of balls (androllers), so we focused on the round shape of the logo, to witness
this item.
Besides this, the new logo refines the shape of the previous one,to obtain a perfect circle, that is a symbol for precision, one of the
topics that the company is focused on.

Today and with satisfaction
we can say that the Brand
Identity has really changed
the way we experience thecompany and are proud tobe part of it: the factories
have done and continue tocompete to improve theworking environments andour employees are the bestambassadors of this new wayof being Tsubaki Nakashima.

a

a

2023

new brand
37°

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

29

The new logo comes froma connection with the past
and with the deep identity of
the company, but glances attomorrow, evolving its roundshape and round lines towards
the future. Institutional colors
are set, TN blue grey andTN purple red, which values
are determined in different
color scales to allow perfect
replications in all the contexts.

2023

new brand
GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
As for the colors, an institutional
lettering is set, reminding thehistorical use of Helvetica fontfamilies, renewing and refining it
to obtain a strong identity, bothin the logo and in everyday use
for titles in texts. About bodycopies, as you can see, the chosen
font is Calibri, with which thisESG report is written. All theserules are kept in the branding
identity and plants guidelines.

IND
CRED
NOTE

31

GEN
STR
Q
Sharingthecorporate
guidelines allowed all plants
in the world to be connected
and to widespread anddevelop the company identity,
through colors, signs, use of
the logo, gadgets, clothes.
This harmony conveys astrong improvement in the
One Team feeling and in theperception of the company as
seen by its employees and its
stakeholders.

2023

new
brand

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

33

NO MAN
IS AN
GEN
STR
The process of rebranding is declined
into many items andoffers the chance to all
the plants to convey
harmony in a common,recognizable company
identity.

2023

new brand

Q

WELCOME!

SOC
GOV

VISIONO UR
ACHIEVE

PROFITABLE AND
SUSTAINABLE GROWTH

WITH AN UNWAVERING COMMITMENTTO IMPROVEMENT, PRODUCTAND CREATING EXCELLENCESHAREHOLDER VALUE

WITH AN INCREASING DEDICATION TO

SUSTAINABILITYWITHIN ITS LEADERSHIP, OPERATIONS,EMPLOYEESAND INVESTMENTS.

GROWTH

THINK
FIRST
THEN
ACT!

SUST
SOC
SUPP
IND
CRED
NOTE

35

TSUBAKI NAKASHIMA

GEN
STR
Q
SOC

ASIA

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

37

During this very difficult three-year period, which saw health andenergy crises heavily hit the entire world and Tsubaki Nakashima
too, the Company worked and invested to build new plantfactories,
to restructure its business, literally re-establishing entire regions anddivisions and laying the foundations for a sustainable and profitable
future. There are many challenges that await Tsubaki Nakashima, in
a rapidly changing economy, with new technical, technological, anddigital solutions, as well as new business opportunities.

GEN
STR
Q

With 2024 organizational changes, effective January 1st, theCompany wants
1 to be the Best-in-Class and to increase TN’s corporate value by
developing ball products which outperform others and providingthem to customers, thus achieving higher profits.
2 to realize the turn-around of the Americas Business andrestructuring the Linear Business Reform, by the end of FY2024.
3 to review TN Ball Business (Cr Steel/Ceramics) from theperspective of the market/customer and transform each plant into a
homogenous profit structure, strengthening Marketing and Productmanagement to increase the profit margin of XS, S, L and XL sizes,
balancing Customer satisfaction and profitability through evolutionof global production flow and establishing regular strategic dialogue
with key Customers to understand their strategies and trends, andto build a base on which TN can respond.
4 entering an era in which DX (Digital Transformation) will
determine the success or failure of corporate growth, while TNmust first accelerate digitalization.

SOC
GOV
SUST
SOC
SUPP
IND
CRED

Organization

NOTE

39

To achieve these objectives, Tsubaki Nakashima decided to make animportant change in organizational perspective, replacing the base from
Regional and Global Functions to a Product axis and change to a structure
which enables strategies based on business intelligence and at the sametime putting more emphasis on the Plant as the starting point for value
creation, with the right delegation of authority and control processes,
aimed at speeding up action planning and execution.

CEO
GEN

Ball
Operations
Division

Business
Management

STR

RollerOperations

Q
SOC

HR & ESG

Best-in Class
Engineering

Ceramic
Business

China

AmericasOkayama (Japan)
Rayong (Thailand)
Cumming (GA-USA)

Taicang
KunshanChongqing

Cumming (GA)Mountain C. (TN)Erwin (TN)Ball Plants
Europe& India

Japan Ball
Linear/Blower
BRP

Medical
DeviceBusiness

Sault St. Marie ​(MI–USA)​
Pinerolo (I)Katsuragi​
Konjic (BIH)
Koriyama​
Mirandola (I)​
Krasnik (PL) Erwin (TN-USA)
Sechibaru​
Kysucke NM (SK)Taicung City (Taiwan)
Bhilad (India)
Worthing (UK)Silvassa (India)

Quality

SUST
SOC
SUPP
IND
CRED

SCM
DX Development

GOV

NOTE

Organizational Chart

41

PRODUCTION

GEN
STR

To be the Best-in-Class and toincrease TN’s corporate value
by developing ball products
which outperform others andproviding them to customers.​

Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

43

PRECISIONSTEEL BALLS

67%

PRECISION
CERAMIC BALLS

12%PRECISIONROLLERS AND STAMPINGS

11%

LINEARAND BLOWERS

6%

GEN
STR
Q
SOC

PLASTIC BALLSMEDICALDEVICES

1%

2%

BALL
RELATEDPRODUCTS

GOV
SUST
SOC
SUPP

1%

IND
CRED
NOTE

Products by sales

Core Business

GrowthTransformation

Niche

45

Role of equipment factory
MAINTENANCE OF BEARING BALLPRODUCTION EQUIPMENT
1 Manufacturing
Design / manufacture and new developmentof production equipment
2 Improvement and maintenance ​Perform improvements and maintenance as needed ​3 Equipment supply
Supply production equipment to overseas production bases​

Tsubaki Nakashima
manufactures production
equipment
in-house​owns a dedicated factory for ​NEW PRODUCTION AND MODIFICATIONOF JIGS AND TOOLS
1 Jigs and tools
Process (molds, polishing machines) and play
the cornerstone of production ​2 Supply
Supply jigs and tools to overseas production bases ​3 Im​provement
Utilize technology to make improvements that meet needs

Almost all equipment other thanthe ball header process
can be manufactured in-house
All equipment including ball headers
can be overhauled​

EQUIPMENTFACTORYINFRASTRUCTURE DEVELOPMENT
1 Maintenance of electricity supply equipment ​2 Periodic inspection and maintenance of cranes in the factory ​3 Energy saving efforts​​

IN-HOUSE

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

47

PRECISIONSTEEL BALLS

GEN
STR

Precision steel balls are used in cars andevery kind of commercial vehicles – trucks,
trains, airplanes - , in many industrial
machineries including robots, and in avariety of products for everyday use;these include home electronics such as air
conditioners, refrigerators, and vacuum
cleaners to ensure a quiet operation. The
high precision of our precision components
ensures the highest durability and quality tomeet our diverse client’s needs.
Our high carbon chrome steel bearing balls
provide high hardness, superior resistanceto fatigue, outstanding wear resistance, andexceptional dimensional stability to excel inall bearing applications.

Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

49

PRECISION

USA

Erwin
[Tennessee]
Chongqing

Mountain City
[Tennessee]

China

Cumming[Georgia]

Katsuragi

Japan
Pinerolo

Italy

Krasnik

PolandKysuckeNove Mesto

Slovakia

KunshanSTEEL BALLS
A very important event happened in
2023 was the construction of newplant in India (Bhilad), which wasannounced on November 12, 2021.

Taicang

Silvassa
BhiladIndia

In the Indian domestic and the
Asian (ASEAN) markets, growth
in automobile production volume
and demand for machine tools are
expected to increase in line with GDP
growth. In addition, many companies
are reviewing their production bases
and supply chains in response tovarious circumstances in recent years.
Under these circumstances, theCompany has received strong requests
from its customers for a stable supplyof high-quality products to the Indiandomestic and ASEAN markets, as well
as for service support on a global
basis.
By constructing and operating a second
plant in India (Bhilad), the Company
responds to the above demand andposition it as a core production basecapable of meeting demand not onlyin the Indian domestic market but
also in the ASEAN markets and strive
to expand sales through enhanced
customer support.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

[Pictures taken from theinauguration ceremony
November 1, 2023]

51

PRECISION

CERAMICFine ceramics are light and tough; in addition to having
excellent insulating properties, they have excellent wear
resistance, heat resistance and corrosion resistance.
Taking advantage of these characteristics, our ceramicballs are used in bearings for spindle motors of machine
tools, turbochargers, and dental drills that rotate at highspeeds. Ceramic balls are also used as check balls inmetering pumps for fluid control in water treatment andfood applications.
Our ceramic balls are indispensable for creating the future
for environmentally friendly applications such as wind
power generators, electric vehicles, and semiconductor
manufacturing equipment that supports 5G technology.
Fine ceramics are classified into two types, non-oxide, andoxide types.
Silicon nitride (non-oxide) and Aluminium oxide (oxidetype) are the most common materials which are about half
the weight of steel and twice as strong.

BALLS

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

53

USA

PRECISION

CERAMIC

Cumming[Georgia]BALLS

The Global CeramicBusiness
Division
produces in Japan,
Thailand, and USA.
In 2023 we opened a
new Plant in Thailand,in Rayong

OkayamaJapan

RayongThailand

Silicon nitride has excellent mechanicalproperties for use in Hybrid Bearings suchas lower thermal expansion, high rigidity,
and wear resistance.
Silicon nitride balls are used in full ceramicand hybrid-ceramic bearings in applications
where ultra high-speed rotation is required.
The density of silicon nitride is less than halfthat of steel, reducing the centrifugal force
during bearing rotation which enables faster
operating speeds.
Silicon nitride balls have an insulating
property which is highly effective inpreventing electrolytic corrosion. This makes
Silicon Nitride balls the optimal solution as acountermeasure against premature bearing
failure in electric motors.
The non-magnetic property of silicon nitride
is ideal for use in applications subjected toa magnetic field. Using steel balls in theseapplications may disturb the magnetic
field or effect the rotating torque. Silicon
nitride balls bearings are ideally used insemiconductor manufacturing equipment
and medical diagnostic equipment where
magnetic fields are present.
Aluminium oxide balls have provencapabilities with superior wear performancein corrosive environments and hightemperature conditions.
The material resists oxidation and istolerant to high moisture environments,
salt solutions, and many chemicals; typicalapplications include pumps, valves, andflow meters.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

55

GEN
STR

Our industry position as thelargest independent manufacturerof precision rollers allows TN
the flexibility to offer products
matching a wide range of customer
specifications.
Our products are used in a growing
number of applications, includingtransmissions, engines, pumps,
wheel bearings, mining, heavy
industry, and railway.

ROLLERS

Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

57

USA

ROLLERS

Erwin[Tennessee]

The Division comprises
three Roller plants, inBosnia, Poland and USA.

Krasnik

PolandKonjicBosniaAs the world’s largest independent producerof Tapered rollers (TRB), we manufacturerollers in a range of sizes, materials, andprofiles according to customer specification.
Tapered rollers, typically found in automotive,
wind, rail and industrial applications, carryboth radial and axial loads and can carryhigher loads than ball bearings due to theline contact between the roller and raceway.
Spherical rollers: the current manufacturing
program consists of near net shape headed
and heat-treated blanks. Typically foundin industrial applications, spherical roller
bearings are designed to accommodate heavyradial loads, as well as heavy axial loads inboth directions. Our rollers are manufactured
to extremely tight tolerances, improving
the overall quality and performance of aspherical bearing.
We manufacture Cylindrical rollers (CRB)
on a global scale and offer a variety ofmaterials,
diameters,
andprofilesaccording to specification. Typically foundin automotive, wind, rail and industrial
applications, cylindrical rollers facilitate arigid rotation around a defined centerline.
We have a long history of Needle rollers
production and supply a diverse global
customer base. Main applications are in theautomotive and industrial markets, such as
rocker arm pivots, pumps, compressors, andtransmissions.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

59

ROLLERS
Our strategy – started in 2021- intends to position
the company for growth on TRBs and CRBs, withthe strengthening of Operations and Technology,
through the consolidation of functions of highcost roller plant in the Netherlands to Bosnia andan intensive project transfer activities in a shortperiod of time (transferring of 27 productionlines) with 20M EUR investment to enlarge ourBosnia plant from 4k to 16k sqm, hiring & trainingof 220 people. In 2023 we focused on processcapability and redesign of the organization to
support future growth and in the next years
we want to be considered as the Best-in-Class
Supplier in Europe.
In America, the strategy is to strengthening
Operations to support growth in Core Products(CRBs for Hydraulic, Industrial and Gas applications
and TRB Feasibility)

GEN
STR

KonjicBosniaQ
SOC

EUROPEANROLLERSOPERATION

The Bosnian Rollers plant, since 2014
belonging to TN, absorbed in 2022 theNetherlands Rollers production. The
second and last production Facility ceased
production by the year end 2023.
When the decision was made to close theplants, TN had to let the 250 employees go,
and was determined to do this in the bestsocial way possible, by applying the “No one
is left behind” principle. After the official
announcement to the stakeholders TN set
up a Social Plan package, together with theLabour Unions. Also, the Works Council was
involved to check and study the reasonsfor closure and were needed to formallyapprove the Plant closures. Both Unions andWorks Council finalized their involvement
and agreed with the closures and the way
TN set up the support to the people losing
their jobs.

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

61

ROLLERSTheSocial Plan pack consisted of the following:

An employee survey connecting the plans of theemployee with the timing of the lay off with thepossibility to help the transfer of equipment andknowledge to the Bosnian plant.
An exit allowance (severance) based on Dutch
legislation incl. a generous multiplier.

A particularly important
project, due to the potential
negative
consequences
for employees, was thatof the closure of 2 plants
in the Netherlands, theRoller’s Plant, and theSheet Metal Parts Plant, in
Veenendaal. The Project
was significantly called:
LEAVE NO ONE BEHIND.

Personal financial advice
Personal legal advice
Personal pension advice
Personal outplacement training
Personal education budget
As an extra the HR manager organized a job market
with local companies presenting themselves as
a possible new employer and offering their job
openings. Around twenty-five companies attended
this job market.
This job market in combination with the outplacement
services was extraordinarily successful and over 98%
of the employees either found a new job or were able
to retire at an earlier date than formally. Some people
started their own company or took the opportunity
to plan extra training to improve their labor market
position or even commenced a career switch.
The buildings and the land of the Dutch facility havebeen sold to the Municipality, enabling them todevelop the land to the needs of the community.
We can conclude that, even though a lot of our former
employees had to go through the mourning processof losing their job and enter a period of uncertainty,
TN was able to support them in this difficult phase inworking live and guide them to see new challenges
and by the approach described above TN’s compliedwith its Social Governance policies.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

63

GEN

MEDICALDEVICE
BUSINESS

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

65

USA

TsubakiNakashimaacquiredalloutstanding shares of Rispa Srl, an Italianplastic resin molding manufacturer, on July
31, 2023.
As the most effective way to promote thegrowth of the “Medical Device Business,”one of the pillars of its growth strategy, by
acquiring a resin molding manufacturer
with strong development technology andgrowth potential, the Company Tsubaki
Nakashima brings into its group the ability todesign and manufacture molds at low costbased on technical capabilities and sales
channels in Europe and accelerates its profit
improvement and global sales expansion.

Sault Saint Marie[Michigan]

The Division comprises
two plants, in Italy and
USA (Michigan).

MEDICALDEVICE
BUSINESS

Our plant in Sault Saint Marie (Michigan) is
specialized in high quality injection moldingof plastic tubes, petri dishes and other plastic
disposables, using the state-of-the-art injection
molding and clean room technology with advanced
skills where tight tolerance, special color, clarity
or light transmittance and lot-to-lot integrity.
Some specialty injection molded plastic parts canbe manufactured in our Class 8 Compliant, ISO
13485:2016 Certified, FDA registered clean room.
General ISO 9001:2015 production of solid plasticballs for medical diagnostic tests and devices are
manufactured to OEM specifications with typicalsize range between 1/16” and 1” diameter. Tsubaki
Nakashima engineers assist Customer’s design
engineers in product selection to determine theoptimal material, size, dimensional and surface
characteristics for the specific application.
In Michigan we produce solid plastic balls,
which are a light-weight alternative to metalballs. Less than 1/6 the weight of metal and theweight of aluminum, advances in plastic material
formulations and thermoplastic products caneven outperform metal in certain applications.
The balls can be used in applications requiring
light weight, noise reduction, corrosion resistanceor color. Common applications are lightweightbearings, check valves, and plug balls.

Mirandola

Italy

TN Rispa (ISO 13485 e ISO 9001 certified) isa high-tech Company, focused on providing“out of the box” solutions for the productionof plastic components. Its “One-stopshop” can support the entire manufacturing
process of a medical device component,from design to full manufacturing, in a
dedicated clean room.​
Located in the heart of the Biomedical
District of Mirandola, TN Rispa is at theservice of some of the major biomedical
companies with technologically advanced“custom made” solutions.

Market served
Medical in all areas, but with strong focus
on custom made diagnostic consumables aswell as surgery and transfusion technology,
pulmonary and blood management.
Beverage, Cosmetic and Packaging in
general.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

67

WorthingUK

METROLOGYPRODUCTS
Our UK facility TN-UK is dedicated to production
and design of metrology products utilizing speciallymanufactured balls in a range of materials that meetthe most demanding engineering requirements
across all industries. Form matters in the world of
metrology and the balls produced by TN-UK canbe supplied with a maximum error of 0.08µm.
TN-UK is a trusted supplier to some of the world’s
largest metrology OEM’s. TN-UK Laboratory can
supply UKAS certified measurement via our UKAS
accredited calibration laboratory.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

69

LINEAR &BLOWERSJapan
TsubakiNakashimaproduces Ball Screws,
Ball Ways and Blowers
in Japan and Taiwan

Taicung City

TaiwanBall Screws. We have an unparalleled lineup of small
to large products, heavy load products, and highprecision rolled products. These are often used inmachine tools, electric injection molding machines,
semiconductor manufacturing equipment, industrial
robots, and advanced medical equipment.
Tsubaki Nakashima’s Ball Ways. The features of thisproduct are 4 equal load capacities in 4 directions,high moment load capacity, tube type, while also
providing long life, high rigidity, and high-speed
running. This product has an established reputationfor ease of centering in machinery. Like Ball Screws,
Ball Ways are used in a wide range of industries.

Blowers for the Iron & Steel Industry: the iron andsteel industry require stable operation under harshconditions of high temperature and high pressure.
We provide safe and reliable products that areresistant to wear and corrosion, high temperatureand special gases (e.g. COG, LDG, BFG).
Blowers for electric power production: Electricity
demands increase year after year. Stable power
supplies will become even more important as
global power requirements expand. Our proventrack record of products and services within
nuclear and thermal power plants demonstrates
our commitment to our customers to meet thoserigorous demands.
Blowers for wind tunnels. Wind tunnels provide
valuable flow data that continue to improve upon
designs of automobiles, motorcycles, sportwear,
and buildings. Tsubaki Nakashima blowers provide
consistent and accurate wind flow that support theevolution of this technology.
High Pressure Blower (Stainless steel). Multi-stage
impeller is a centrifugal fan covering a wide range ofapplications such as a blower.
Fan for Metro: The vanes of the turbo type fansfollow the design of an airplane wings. This fan has
been proven to have the highest efficiency withminimal noise among all centrifugal blowers.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

71

GEN
As our CEO, Koji Hirota, wrote in his introductory letterto the ESG (Environmental, Social, and Governance)
Report, 2023 was the closing year of the Strategic Plan
called “Transform Next” which was based on three
directions:

STR

Expansion of the Ceramic Business
Expansion and Global Developmentof Medical Device Business
Expansion and strengthening in Asian markets

SOC

Q

GOV

together with the improvement of the solid andsustainable foundation on which the guidelines are
based, as well as, more generally, the entire company:

SUST
SOC

One Team Management System
Vision Zero approach
Transformation and sustainable projects throughresponsible use of energy, sludge recycling,
improvement of material yield and ergonomics

TRANSFORM
NEXT 2023

Mid-Term

STRATEGY
2021-2023

SUPP
IND
CRED
NOTE

73

ENVIRONMENT
The full implementation of
Global Sustainability System,
applied in every plant

We already mentioned Vision Zero, which
is a holistic way to define ambitious targets,envisioning a Company continuously
improving, where there are not any
inequalities and where knowledge isconsidered a strategic asset.

SOCIALTN Academy, now conveyed throughthe E-learning Platform called Talent LMS
The full implementation of a software(“Checker”) to manage internal auditing, safety,
health, Environment, Energy and System’s
inspections, and related corrective actions
Renewed HR Processes like Goals andObjectives, Survey, Performance Evaluation

The One Team Management System is
now available on the new Global Intranet,
where the entire Governance System isdefined and shared
And many Sustainable Projects weredeveloped with a Long-Term horizon,
guaranteeing the achievement of the
Sustainability Target until 2028, of which
Carbon Footprint is the key

Mid-Term

STRATEGY
2021-2023

GOVERNANCE

Integrated Corporate Governance
The renewed Quality Management System
Risk Management Committee,
reformed at the end of 2023
Sustainability Committee,
reformed at the end of 2023

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

Before talking about the actions and investments
implemented to achieve the objectives of thestrategic plan, although greatly influenced, and insome cases even negatively, by the great crises andconflicts that have affected the entire world in recent
years, we want to mention the aspects that mostcontributed to the achievement of those specificallyrelating to ESG issues, in 2023

CRED
NOTE

75

SALESGROWTH
But now let’s see
what results wereachieved in 2023 andthey should be added
to those alreadydescribed in theprevious ESG Reports
2021 and 2022.

BUILDING
A FOUNDATIONFOR THE FUTURE

GEN

RESTRUCTURING
OF EUROPEANROLLER BUSINESS

Withdrawal the roller businessfrom the Netherlands >Gaining cost competitivenessby consolidating Bosnia.

and a precise

STRATEGYTO OFFSET
THE INFLATIONAND ENERGY COSTSINCREASED

Mid-Term

STRATEGY
2021-2023

RESULTSINDIA’S
SECOND PLANTCOMPLETED

Q
SOC
GOV

Major

EXPANSIONOF CERAMIC BALLSUPPLY CAPACITY

to support rapid progress in EV:
major expansion of production
capacity in Thailand, in the meantime
securing of raw materials
and diversifying of sourcing.

ACQUISITION
OF TN RISPA

able to make a step forwardin the European medical Device
Business Strategy in Europe,and in the meantime adding
new technical knowledge
to the Michigan Plant in USA .

STR

SUST
SOC
SUPP
IND
CRED

MONOZUKURIINNOVATION

developed
at mother factoryin Katsuragi, Japan.

NOTE

77

Under these circumstances,
TN’s current management policies include:
A strengthening sales by reviewing unprofitable products and othermeasures and restoring earning power by rebuilding the U.S. andLinear Businesses, andB improving development speed, streamlining, and strengthening
development resources, investing in human resources, andstrengthening DX initiatives in order to become a Best in Class
manufacturing company.

On October 18, 2023, Tsubaki Nakashima announced
the entry into a business alliance agreement with
Advantage Advisors Co., Ltd.
As a manufacturing company, TN places “safety, quality,and environment” at the top of its management
priorities and seeks to carry out its business activities
in harmony with society, local communities, andnature. TN is accelerating the globalization of medical
products and other products that meet the needs forhigh-quality healthcare in response to the COVID-19
and the aging of the population toward the realizationof a decarbonized society in the future.
The Company is working daily to steadily implement
its management strategy, achieve further profitable
growth, and become a shining company that continues
to create corporate value.

ADVANTAGEADVISORS

Under these circumstances the Company has selected
Advantage Advisors, which has a track record of providing
strategic advice to several listed companies, as a business partnerwith which we believe we can receive advanced management support
regarding our initiatives such as recruiting, strengthening business
management systems, promoting M&A, in addition to fundraising, andthus enhance our corporate value.
By utilizing the know-how received from Advantage Advisors,
Tsubaki Nakashima will actively promote the consideration andsteady implementation of various measures to improve its businessperformance, like
1 Recruiting
2 Strengthening business management systems
3 Promotion M&A (including capital tie-ups)
4 Other services as separately agreed upon by the Company
and Advantage Advisors

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

79

GLOBAL QUALITY
The continuous attention to our Customer’s needs is a key
point in TN Quality philosophy. This approach brings to a close
collaboration with our customers that turns into a trustfuland strong relationship.
Tsubaki Nakashima strongly believes that our customers area great asset for the company because it is thanks to themthat the group is prompted to constantly look for a design
new processes, new methodology and new technologies;
the goal is to offer to clients the best solution in terms of
products, flexibility and price for achieving the TN strategy ofbest manufacturing company of rolling elements.
TN Quality is focused on understanding deeply customer
requirements and how to transfer them into TN’s process andorganization; starting from 2018 the TN group has defined a
specific approach to manage Customer Specific Requirements(CSR) where all processes are involved from Sales to Quality.

Quality

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

81

QUALITYVISION

TsubakiNakashimaiscommitted to put inplace
anorganization
and resources to achieve
our goals and commit tocontinuous improvement,
fully compliant with thehighest ethical and quality
standards. In this way wereach the satisfaction of
our customers, employees
and shareholders. This
commitment is supported
by Group Quality System
and related Group Quality
Manual which outlines theoperation of the company
with all its internal processes.

GROUP

QUALITYQ

SYSTEMTN Group Quality System,as main goals, has to:Satisfy norms
and customer specific requirements
Achieve excellent quality
and service performance
Develop with the customers
innovative products solutions
Analyse and reduce risks,develop opportunities
A management review is conducted yearlyat plant, region and group level according to
specific procedure; The minimum content of
the review is about Audits results, Customers
data (satisfactions, feed-backs, claims),
Processes KPIs, risk/opportunities assessments
results, review of actions. In addition to
management review a monthly quality review
is organized to review the performance resultsof the site and to update the improvement
plan.
Processes are directly assured by centralized
Quality functions and are common to all
entities of TN Group. Auditing centralized
system ensure that processes produced the
expected results and ensure that the resources
are aware of requirements.
Follow-up of performance indicators, allowing
evaluating efficiency and effectiveness ofprocesses, are defined every year during themanagement review and during monthly
review.
TN Global Quality Management Systemcovering 100% of TN plants accordingly to ISO
9001 and IATF 16949 Automotive standards;
The Global QMS was extended to cover the
AS 9100 Aerospace and ISO 13845 Medical
Device standard in specific plants.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

83

GLOBALQ

QUALITY
Tsubaki Nakashima, working constantly
on improvement, was able to significantly
improve the main Global Quality KPI’s in
the last 5 years (average year improvement> 6%).
TN continuously monitors complaints
versus products supplies and in 2023
reached a level of one incident per 18
billion JPNY.
The level of results reached wasstrengthened by Quality Improvement
Plan launched in 2018 and continuously
pursued as continuous improvement
project.

KPI

2023
VS2019-34%

CNQ(% on Sales)-32%

Claims / BJPY
Sales (nr)The project is based on four axis:
Standardize through the adoption of specifictools like Quality Standards, 5S, Kaizen, A3, etc
Maximize the effect through lessons learned
and sharing best practices between sites
Respect the standard through zero tolerance
policy, applying integrated auditing system andprocesses
Improve through “best in class” approach
aimed at reaching the excellence

GEN
STR
Q
SOC
GOV

0%
10%

-40%

20%

SUST
SOC
SUPP

30%
IND

40%
CRED

Wasted lots
on inspected

50%
NOTE

85

MAIN

GLOBAL QUALITY
ACTIVITIESHARMONIZATIONOF STEEL BALLINSPECTION
PROJECTTN INDIA
IMPLEMENTATION

Eddy current

INSPECTION
REINFORCEMENTQ

Steel balls and rollers

Started theGave priority to

PRODUCT / PROCESSINNOVATIONSTRATEGY

Completed

DETAILED PLAN
FOR THE INNOVATIONPROJECT

Definition of

HT INSPECTION
POINTS

MARKET TRENDRESEARCH

on rolling steel products

GEN
STR
Q

StartedPROJECTS
WITH HIGH PRIORITY
in the related sites

SOC
GOV
SUST
SOC
SUPP
IND
CRED

Study of

ALTERNATIVE
INSPECTIONMETHOD

NOTE

87

MAIN

GLOBAL QUALITY
ACTIVITIESOperational support to

TN BOSNIAON STABILIZATIONOF QUALITYPERFORMANCE

Transferreed and updated the

RISK MANAGEMENTPROCESS IN INTRANETSYSTEM APP

QDefined common

MANAGEMENTSYSTEM DOCUMENTS
ORGANIZATION AND
TRAINING METHODOLOGYGEN

REGULAR 2 MONTHLYFOLLOW-UP/REVIEWS
with each site on

KPI TREND AND
IMPROVEMENT ACTIONSCONTINUOUS SUPPORTTO CUSTOMERSAND SITES
on customer complaints
and field returns analysis

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

89

GLOBALLABORATORYTN is working to be leader in the customer
services also trough Central Laboratory
with 2 operative units in Japan and Italy.
The scope is giving high level of analysis/
testing services and supporting innovation,
development and training activities for theentire organization.

304

Total
analysis / Testing (nr.)

Our mission is:
to offer analysis and testing services
using reliable facilities and qualified staff.
to provide fast, accurate, professionaland efficient services using the mostadvanced methods in a way that reflects
full compliance with international quality
standards.

STRATEGIC CENTRAL LABORATORY GOALS
Offering a wide range of analysis/testing
services and methods with the greatest
accuracy and speed.
Endorsing the laboratories to be a centreof excellence and a source of references.
Establish a cooperation and laboratory network
connected to Customers, Suppliers, Universities
and Research centres.
Extending laboratory services to cover all tests
that serve the industrial research sectors.
Enhance the ability of human resources toreach the extent that satisfies the customers’
needs effectively.

2023

CENTRALLABORATORY

43.260Japan Unit KPI
avg cost / activity (JPY)

Japan Unit OTD (%)

STR
Q
SOC
GOV
SUST
SOC
SUPP

PERFORMANCE

117

GEN

IND

715

Italy Unit KPI
avg cost /activity(Euro)

CRED

93

NOTE

Italy Unit OTD (%)

91

Opening
ceremony of the

POLITECNICODI TORINO
JAPAN HUBIN KYOTO

The ASTM selected 2 technical publications(STP) from TN in collaboration with
Politecnico of Torino on bearing steel
technology. The STP information is applied in
the new ASTM International manual Rolling
Bearing Steel: Design, Technology, Testing,and Measurements (MNL83) that publishedin 2023.
https://www.astm.org/stp1649-eb.html

GEN
STR
Q
SOC
GOV

EVENTS

Paper presented during theInternational Conference on
Ceramic Coating and Surface
Engineering in december
2023 in Amsterdam by
W.A.S.E.T.

SUST
SOC
SUPP
IND
CRED

Participation to seminar:
Universities and Industrial
Collaboration between
Japan and Italy

PublishedinMaterials
Volume 21, March 2024,
100540 an article ondevelopment of Cold SprayHEA coating in collaboration
with Politecnico of Torino andTrinity College of Dublin.

NOTE

93

INTERNATIONALEVENTS
AND PARTICIPATION
Tsubaki Nakashima seeks tocontribute to the achievement ofa sustainable society through its
business activities and thereby
become an indispensable company.
For this reason, we endorse andtake part in numerous international
congresses and meetings to sharewhat we are doing and to learn fromothers.

IN EXTERNALINITIATIVES

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

95

International Trade Show - MEDICA 2023

INTERNATIONALEVENTS
AND PARTICIPATIONFiORP – International Foundation for theOrganizational Risk Prevention

IN EXTERNALINITIATIVESFranco Dutto presented Pequeno Bestiario
Organizational, an ironic journey withinorganizations .

Our

MEDICAL DEVICE
BUSINESS TEAM
participated in the twomost important

MEDICALSECTOR FAIRSin the world

GEN
STR
Q
SOC
GOV
SUST

And very recently, at the beginning of 2024 TN Michigan
was awarded the INDUSTRIAL ACHIEVEMENT AWARD
from the Economic Development Corporation andChamber of Commerce (Sault Saint-Marie, Michigan).

SOC
Universidad Autonoma de Chile,
Santiago, Chile - Artificial Intelligence andAugmented Humanity

National Trade Show AACC 2023

CUSTOMER AND SUPPLIERS
During 2023, Tsubaki Nakashima collaborated with
its customers in order to improve its environmental
impacts and sustainable development strategy.
Through workshops, brainstorming, andbenchmarking with clients, Tsubaki Nakashima
has aligned itself regarding customers’sustainability goals, and certainly this sharing ofideas has supported the company’s sustainable
development. In this regard, we mention the“Supplier Sustainability Innovations Automotive
Europe Summit” workshop held and organized by
Schaeffler in Buhl-Germany in September 2023
where Tsubaki Nakashima together with othersuppliers presented its sustainability strategy witha focus on energy efficiency projects. On thatoccasion it was possible to network with manyother suppliers on issues related to environmental
sustainability.

Our China Region’s President, Mr. Zhang
Li received the prestigious SKF AWARD
for the best and most reliable suppliers.

SUPP
Mrs. Stefania Lamparelli,Global Sustainability Manager

IND

Cosimo Colasanti,
Americas Region President,
and Brian Jenning,
Americas Region Senior Sales
Director, participated in theinauguration of the new SKF
plant in Mexico

CRED
NOTE

97

An important delegation of JapaneseBusinessmen visited our new Plant in
Bosnia i Herzegovina

INTERNATIONALEVENTS
AND PARTICIPATIONMEMBERSHIPSUNIONMECCANICA TORINO
Franco Dutto is a memberof the Council

IN EXTERNALINITIATIVES

GEN
STR
Q
SOC

ABMA – American Bearing Manufactures Association’s
Evelise Faro is a Board Member
JAPAN INVESTORRELATIONS ASSOCIATION

Tsubaki Nakashima has been awarded as
one of the most important investors in
Bosnia i Herzegovina.

We have a membershipof JAPANESE BEARING
INDUSTRY ASSOCIATION
and CHINA BEARING
INDUSTRY ASSOCIATION.

GOV
SUST
SOC
SUPP
IND
CRED

PUBLICATIONS 2023
And the Best Investor in Konjic.

Prevención Integral:
Blog “La vida
es una esfera”

NOTE

99

RELATIONSHIPSWITHSCHOOLS

Tsubaki Nakashima has always
cultivated relationships with schools
and universities at a local level;
we think it is a corporate duty toshare our way of producing andmanaging the individual companiesof the group with those who willbe the employees of tomorrow,offering doctorates, but also training
internships to students of different
levels, opening our factories to visitsof students from primary, secondary
and university schools

BOSNIA I HERZEGOVINAIn Bosnia I Herzegovina we set up an entire information room in Konjic secondary school, withcomputers provided with donations from some ofour corporate executives.
ITALY
We hosted 15 students for 2.550 training hours.

BosniaSLOVAKIAIn Slovakia we sponsored a competition between
students of a technical secondary school.
KATSURAGI (JAPAN)
In Katsuragi, Japan, we were honored about thevisit of an elementary school.

Slovakia

We have entered into collaboration agreementswith the Polytechnic of Turin (Italy and Japan), theUniversitat Polytecnica de Catalunya (Spain), theUniversity of Dublin (Ireland), the University of Bratislava and the University of Zilina (Slovakia), theEast Tennessee State University (USA)

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED

Japan

NOTE

101

SUSTAINABILITYasthesimultaneousachievement of ECONOMIC PROSPERITY (forinstance, growth and profit), the creation of a
HEALTHY, SAFE AND LOW ENVIRONMENTAL
IMPACT environment, where everyone is EQUAL,
with equal rights and duties, equal opportunities.
Then, the attitude, the results and the merit will
make the difference. But to do it, we needed alighthouse and most of the 17 UNITED NATIONSSUSTAINABILITY DEVELOPMENT GOALS are
perfectly fit for that.

PLANET
ENVIRONMENTALPROSPERITYECONOMICALCONSERVATIONPHILOSOPHYISSUESISSUESGENSUSTAINABILITY
LAND
ETHIC

MORAL
ECONOMYSTR
Q
SOC

PEOPLE
SOCIAL ISSUESGOVERNANCE

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

103

In Tsubaki Nakashima we started from the
MANAGERIAL STATEMENTS, from theconstruction of conceptual pillars, on which
to base the HIGH-LEVEL POLICIES AND
PROCEDURES (One Team Management
System, base of the Corporate Governance), realguidelines for all our plants around the world.
But also, to make available SYSTEMS, based on
ISO STANDARDS (Quality, Environment, Healthand Safety, Energy, Ethics), which would allow a
disciplined and standardized management. Lastly,
the MEASUREMENT OF PERFORMANCES
which presupposes the identification offunctional objectives for the achievement of thesustainability targets.

TARGETSAND KPISSYSTEMSPOLICIESSTATEMENTS

CODE OFBUSINESS ETHICSOPERATIONSSTRATEGY
CODE OF BUSINESS ETHICSCORPORATEGOVERNANCE POLICIESFINANCE AND ACCOUNTINGPROCEDURESIT PROCEDURESQUALITY MANAGEMENT SYSTEMGLOBAL SUSTAINABILITY SYSTEM

GOVERNANCE

MANUAL OF COMPLIANCE
CODE OF BUSINESS ETHICS
NON-RETALIATION POLICY - WHISTLE-BLOWER
CONFLICT OF INTERESTDATA PROTECTION
TRACKING REGULATIONSPROTECT WELL-BEING
CREATE POSITIVE RELATIONSHIPSLABOR STANDARDSCHILD LABORNONDISCRIMINATION AND EQUAL OPPORTUNITIESINCLUSION AND DIVERSITYASSOCIATION, BARGAINING, WORK ORGANIZATIONTSUBAKI NAKASHIMA AWARDSGOALS AND OBJECTIVES - PERFORMANCE EVALUATIONGOAL AND GAIN SHARING PROGRAM
BONUS SYSTEM, ACCRUALS AND RELEASE OF ACCRUALSONBOARDING POLICYBLOGGING AND SOCIAL MEDIA - EMAILING AND INTERNET POLICYTRAVEL POLICYGLOBAL MOBILITY PROGRAM
COVID-19 - GUIDELINES BASED ON ISO 45005-2021
CLIMATE CHANGE AND GHG EMISSIONSEDUCATIONAL ASSISTANCE PROGRAMCOMPANY CARS EU – SUSTAINABILITY

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

105

Tsubaki Nakashima has adopted a MANUAL OF COMPLIANCE, CODE OF BUSINESSETHICS AND RELATED POLICIES addressed to all those who have employment,
collaboration, consultancy, or other relationships with the Company.
The Manual of Compliance, Code of Business Ethics and related policies dictates the rules ofcorrectness and transparency that distinguish the company's work and is based on a seriesof principles with values, which are then declined within the code:

HEALTH SAFETY AT WORK,ENVIRONMENTAL PROTECTION,RESPONSIBLE USE OF NATURALRESOURCES(THROUGH THE GLOBAL SUSTAINABILITY SYSTEM)CORPORATEGOVERNANCE 2023

GEN
STR

SOCIAL POLICIESRELATIONS WITH SUPPLIERS
AND INTERLOCUTORSOF THE COMPANY

Q
SOC((I.E., GOAL AND GAINSHARINGPROGRAMS, AWARDS)GOVRELATIONS WITH AUTHORITIESAND COMMUNITIESACCOUNTING
ACCURACYCONFIDENTIAL AND RELEVANT
INFORMATIONSOC

ORGANIZATIONAL MODEL
AND SUPERVISORY BODIESPROTECTION
OF PERSONAL DATAPERSONNEL POLICIESAND LABOR STANDARDS(I.E., EQUAL OPPORTUNITIES, INCLUSION
AND DIVERSITY, FREEDOM OF ASSOCIATION,
CHILD LABOR)

SUST

SUPP

REPORTING IN CASE
OF VIOLATIONS
OF THE PROVISIONS OF THE CODE

IND
CRED
NOTE

TRANSPARENCY AND COMPLETENESSOF INFORMATION
107

Our CORPORATE GOVERNANCE SYSTEM consists of the Board of Directors, Nomination
Committee, Compensation Committee, and Audit Committee assupervisory bodies. Management Committee, Sustainability Committee and Risk Management
Committee are business execution bodies. We have adopted the organizational design of acompany with a nominating committee, etc., because we believe that the separation ofsupervision and execution is a means of enhancing corporate value by strengthening thesupervisory function and ensuring prompt management.
The BOARD OF DIRECTORS, consisting of 7 Directors (including four outside Directors), makes
decisions on basic management policies and supervises the execution of business by the
Executive Officers. Each of the outside Directors has his or her own area of expertise and basedon their extensive experience and wide range of knowledge, they provide advice and exchange
opinions on management, thereby fulfilling the supervisory function.

To conduct business and grow ona global scale, the Group is working to strengthen its highly transparent and objective Integrated
Corporate Governance System. In
addition, we have established aManagement system with a senseof unity by realizing a group company management function withefficiency and expertise.

COMPLIANCE PROMOTION SYSTEM
Under the supervision of the President and Representative Executive Officer,
who is in charge of overall management, compliance is promoted mainly by
the Executive Officer in charge of HR, Compliance & Sustainability (CHRO).
In addition, an Internal Audit Office has been established directly under the
President and Representative Director to conduct internal audits and confirm
the status of compliance. In addition, an assistant to the Audit Committee has
been established under the direct supervision of the Audit Committee to audit
the compliance status of directors and other officers.
The Internal Audit Office, the Audit Committee assistant, and the accounting
auditor share information as necessary to strengthen cooperation.

The NOMINATION COMMITTEE consists of two outside Directors (including the Chairman)
and one inside Director, and most of the committee members are outside Directors to ensure
the appropriateness of nominations. The Nomination Committee decides the details of
proposals for the election and dismissal of Directors.
The COMPENSATION COMMITTEE consists of two outside Directors (including the Chairman)
and one inside Director and has a system to ensure the appropriateness of remuneration; it
determines the basic policy on remuneration, etc. for Directors and Executive Officers and theamount of remuneration for everyone.
The AUDIT COMMITTEE is composed of three outside Directors, each of whom has a different
area of expertise, and is appointed based on the belief that audits from various perspectives are
possible. The Audit Committee audits and supervises the execution of business by the Directors
and Executive Officers and decides on the content of proposals for the appointment anddismissal of the accounting Auditor to be submitted to the General Meeting of Shareholders.
In addition, we have established a system in which a full-time assistant to the Audit Committee
assists the Audit Committee.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

GOVERNANCE

CRED
NOTE

109

RISK
MANAGEMENTSYSTEMAll our Risk Management Procedures are based on International Standards
and are present in the 2 Tsubaki Nakashima’s Management Systems:
1 QUALITY MANAGEMENT SYSTEM (QMS): Procedure MGT_07_08 Risk

Management Process and Committee (RMC) – ISO 31000 and IATF 16949
2 GLOBAL SUSTAINABILITY SYSTEM (GSS):The Risk Management procedures, designed to
improve Quality, Health and Safety, Environment,
Energy and to address urgent and relevant issues (inall the business fields, including the Sustainabilitypart) are applied to all risks that are present in the
different Organizations and which could potentiallyharm the stakeholders, including workers, impact
the environment, the energy management andreputation, liability, business in general.

Procedure GSS – T2 - 6.1.2 - Hazard identification and assessmentof risks and opportunities – ISO 45001:
this risk assessment procedure, designed to improve Health and Safety,
is applied to all risks that are present in the unit/plant and which could
potentially harm the employees. In the Procedure, reference is madeto all the activities carried out within the unit/plant and/or involving TN
Employees – including Temps - in the unit or out of it.
Procedure GSS – T2 – 6.1.2 Environmental Aspects – ISO 14001:
this procedure refers to the overall activities carried out by the Tsubaki
Nakashima unit/plant including new and/or modified services, products,
activities, of which the organization has direct control and those activities
which the organization can only influence. The scope is also to evaluate
and minimize all possible environmental impacts in each stage of a
product’s life, defining the responsibility for ensuring that the impact
within each and every part of that lifecycle is as small as possible.
Procedure GSS-T2-6.1-6.6 Energy Assessment – ISO 50001:
this procedure refers to the overall activities carried by out the TSUBAKI
NAKASHIMA unit/plant including new and/or modified services, products,
activities, of which the organization has direct control and those activities
which the organization can only influence, defining the Significant Energy
Use (use of Energy that determines a substantial consumption of energy
and/or which offers a significant improvement potential in the energy
performance), Energy Baseline (Quantitative reference which provides acomparable basis for the energy performance), EnPI (Energy Performance
Indicator), Energy Review and Energy target as quantifiable objective ofenergy performance improvement.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

111

RISK
MANAGEMENTCOMMITTEESpecifically, where there are other potential
corporate risks besides quality issues, thisis the subject of the RMC; compliance andserious industrial accidents are considered
first.​
As said, one of the RMC Focuses is on
developing the plants’ ability to assess theurgency and scalability of the events theydetect1 at a very early stage and2 correctly and not only on the risk
decision matrix.
Ensuring that the plant can act strongly
and autonomously is the Essence ofSupervision by the Global Functions and inparticular Quality.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

RISK MANAGEMENT COMMITTEE (RMC) has theprerogative of identifying and addressing potential
risks to the Management at an earlier stage, andresolve those issues, as well as taking actions forpreventing risks, but also to make the plants and theentire organization aware of quality and complianceissues, including potential matters: events are notconfined to the plant alone.​

CRED
NOTE

113

ATMOSPHERE
APPROACH TO SUSTAINABILITY
Products provided by the Tsubaki
Nakashima Group, including precisionballs, contribute to improving theenergy performance and efficiency
of final products. For this reason,
we believe that not only supplying
high-quality products, but also giving
DUE CONSIDERATION to theenvironment in the manufacturing
process will help reduce theenvironmental impact of the entire
value chain.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

SUSTAINABILITY

CRED
NOTE

115

Tsubaki Nakashima shall continue
to improve its own organization,
processes, products, and services,
AIMING AT REACHING ZERO
defects, zero accidents and zeroenvironmental impact and theimprovement of the energy
performance by means of:

ATMOSPHERE

the involvement, participation and co-responsibility of the employees and workers
representatives where they exist, collaborators and suppliers and other relevant parties with theintention of making them aware of their individual duties, also through specific communication
initiatives, while promoting a healthy and safe behavior, and being aware of the rational use ofenergyembracing the philosophy of the 5 Z’s of sustainability approach, we strive to have Zeroaccidents, Zero occupational illnesses, Zero wastes, Zero inequality and Zero lack of knowledge
the implementation of all that is necessary to guarantee the safeguarding of the environmentand health and safety in the workplacesGENthe development of production processes, oriented to continuous improvement of thesafety, environmental and energy standards, to reduce and eliminate the negative impacts in an
economically feasible manner, by making provision for the acquisition of products and services
with a view to improve the energy and environmental performances

STR

the commitment to preventing defects, accidents, and environmental impacts
rather than identifying thema constant respect for company, customer and governmental health and safety, environmental
and energy requirements
a continuous improvement of the management and performances of health and safety,
environmental and energy matters by locating the necessary resources in order reach the set
objectives and targets, using adequate monitoring and evaluation tools.

Q
SOC
GOV
SUST
SOC
SUPP
IND

All the above to satisfy the requests andexpectations of our employees, customers andshareholders in the best possible way, increasing
the reputation of the company and strengthening
our leadership position.

CRED
NOTE

117

ATMOSPHERE
Think
USE OF RESOURCES
AND SUSTAINABILITY
Tsubaki Nakashima consumes resources
and, in the process of conducting businessactivities across the life cycles of its
products and services, emits GHGs andother emissions to the air, land, and water.
Following the specifications indicated by
the ISO 14001: 2015 standard and ourIntegrated Corporate Governance, we haveassessed the environmental impacts of ourbusiness activities across the value chain to
REDUCE OUR IMPACTS.

Tsubaki Nakashima takes a lifecycle thinking approach in efforts tominimize customers’ environmental
impacts by providing products thatoffer environmental performance.
Almost all our products are 100%
recyclable – we use steel, plastic,
glass, ceramic, aluminum, andother material that could have asecond life.

ChooseIn the Minimum TechnicalStandards set up, we focus ourattention on
Managementof Chemical Substances inmanufacturing,
replacinghazardous substances with
non-hazardous and recycle
them into the process, as muchas possible.

CreateClimate Change Policy,
Pollution Prevention &Chemical Management

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

LIFE CYCLE THINKING
Tsubaki Nakashima defines an ecoconsiderate product as one forwhich environmental impacts are
considered from product conception
to mission completion; that is,
at every phase of the life cycle,
from design and manufacturing totransport, usage, and recycling.

CRED
NOTE

119

Use

ATMOSPHERE

responsible use of natural
resources, as well as ofother resources is key, in our
approach.

Deliver

Transport / Value Chain – Ourmotto is Global Reach and Local
Depth, working to serve ourCustomersclosetotheirfactories,
also to reduce transportationand material handling.

Recycle & Reuse

Oil, coolants and othersubstances are recycled asmuch as possible.

ALL OURPRODUCTS ARE
RECYCLABLE,ALMOST 100%.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED

Through the creation of eco-considerate products, we are cooperating with our Customers to
expand our environmental impact mitigation efforts beyond Tsubaki Nakashima’s doors. The
Group’s core product, precision balls, are basically manufactured and delivered in regions
close to customers for local production for local consumption in order to reduce emissions, aswell as prevent damage and breakage caused by long-distance transportation. Although theprocurement of raw materials, manufacturing, sales, and after-sales service are carried out at eachsite according to the characteristics of each product and region, important visions and directions
in business operations such as purchasing, quality assurance, and technology development
are formulated at the Tsubaki Nakashima Headquarter and communicated to each site.

NOTE

121

Process
Map
Materiality Analysis (next)

Risks & Opportunities analysis

SWOT Analysis
Context
AnalysisTargets
Objectives, Targets & Planning

SUSTAINABILITYCOMMITTEE
All the strategies and activities are reviewed by the
Sustainability Committee, which is responsible forassisting the Management Committee by fulﬁllinga preparatory, consultive and advisory role inassessments and decision making processes withregard to Environmental, Social and Governanceissues, related to Tsubaki Nakashima business andits engagement with all stakeholders, the Corporate
Governance of the Company, and the review of
scenarios envisaged in the preparation of theMedium Term and Business Plans, based also on
the analysis of signiﬁcant issues for the creation of
long-term value.

Competences& Awareness
Rules& Reponsibilities

Risk Management
Human
side

Reports& Continuous
Improvement

GEN

Communication
Measuring

Management
Review

KPIs

STR
Q
SOC
GOV
SUST

Sustainability Committee has the objective to plan, coordinate
and implement the Sustainability initiatives and measures, inaccordance with TN Policy, as well as review and adapt it to theglobal standards and trends.
Members are the Chief Human Resources Officer (Chair),
the Chief Financial Officer, the Chief Transformation Officer,
The Director of Supply Chain, and the Global Sustainability
Manager.
In addition to the usual reporting (status of projects and objectives,
risk and opportunities, new tendencies, or requirements), TN SC
is an “agora” - a gathering place, in the ancient Greece - where
requests, needs, concerns, plans and proposals are put on thetable in a preventive and constructive way.
Every activity that involves resources is brought to the attentionof the SC in advance to guarantee coherence and coordination,in the interests of the Company and its Stakeholders
Tsubaki Nakashima Sustainability Committee gives a lot ofemphasis to communication and marketing activities, in addition
to the very well-structured ones relating to the technical part.
All Sustainability related activities are regulated by the rules of
the Global Sustainability System

SOC
SUPP
IND
CRED
NOTE

123

CORPORATE SOCIALREPONSABILITY THEMES

ESG

Products and Services
Business Operations alignedwith global social trends

EN
Productivity Innovation
VIR
and Competitiveness
ON
Strategic MarketingME
Effective use of energy and resources
NT

GEN

Productivity Improvement - Motus 4.0

STRQ

Climate change

SOC

Contributing to the environment(procurement, products)

GOV

Respect of human rights

SUST

Diversity
Training and development,
employees engagement
Supply Chain
Product Quality and Development
Relationships with the local
communities and other initiatives
ComplianceManagement Systems

SDG
TICK NOTES

SO
CI
AL

SOC
SUPP
IND

GOV
ERN
ANCE

CRED

70

NOTE

125

GLOBALSUSTAINABILITYSYSTEM

TIER 1TIER 2TIER 3
TIER 4

Principles
Guidelines
MS Procedures
Corporate
Processes
and Policies
Instructions, Local
Operative Procedures,
Best practices
Forms
Records

GEN
STR
Q
SOC
GOV
SUST
SOC

When, a few years ago, we designed the conceptualand action flow to make the company truly global
and equipped with a solid and shared governancesystem, we imagined starting from the principles,
then developing a single system and making
available an IT platform (or more than one) for the
Human Resources and Sustainability part
As we have already mentioned (and will repeat), theGlobal Sustainability System bases its foundations
on international requirements (ISO Standards),
and aligns itself with the second important System,that of Quality. The System is at 4 levels, from theManagement Manual to the formats to be used,passing through the management procedures, theoperational ones, the work instructions

While Tier 1 and Tier 2 are the exclusive responsibility of the Corporate
and cannot be modified by individual organizations, which however canpropose improvements and/or modifications, obviously, Tiers 3 and 4 are
the responsibility of the individual Plants. Many Tiers 3 and 4 documents
are available in the system, but they are to be considered guidelines, theimplementation of which is optional, in form, but not in substance.
Like all ISO Systems, the flow is the classic one which starts from thedefinition of the Process Map, to then analyze the Context in which thecompany operates, identify the Risks and Opportunities also deriving fromthe Risk Assessments (of Safety and Health, environmental and linked tothe use of resources), define the targets that are intended to be achieved,
the responsibilities, the times and resources necessary, the systems formeasuring performance and the countermeasures in case of delays and/or
failures, to then produce Report to allow Management (at different levels)to act with a view to continuous improvement

SUPP
IND
CRED
NOTE

127

GLOBALSUSTAINABILITYSYSTEM
CONTEXTANALYSISGENSTRTARGETS

Materiality analysis(next)SWOT analysis
Risks & Opportunities
analysis

Objective,
Targets
and Planning

HUMAN SIDEMEASURE

Roles& Responsibilities

Auditsand Actions

Competences& Awareness

KPIs

Q

REVIEW
Management
Review

SOC
GOV
SUST
SOC

Communication

SUPP

Risk Management

IND
CRED

Process
Map

Without claiming to go into detail about theProcess Map in this and in the next pages, we areinterested in highlighting the methodologicalrigor that drives our every step.

NOTE

REPORTSand continuous
improvement

129

RESOURCES

All employees
and TN organizational levels

PROCESS MAP ANALYSISSUSTAINABILITYSYSTEMGEN

SOURCES
Law & regulations​GRI Standards​
GHG Protocol​
CDP Standard​
ISO Standards​
Authorities​
Unions – Work Council​
Certification’s Body​
External Stakeholders(Customers, Suppliers,
Communities)​
Corporate bodies​
Regions and Plants​
Employees​

All TN PROCESSES​

TOOLS
Risk Assessment​
Software Checker​
Management Systems basedon international Standards​
Safety Engineering Manual​
Minimum Technical Standards​
Intranet and SharePoint​

INPUT

Business Plan ​TN Policies ​MT Plan​
P&L​
Law requirements​
Agreementswith Unions/Work Council​
Social changes​
Factor of production
and technology​
Idea’s/proposals​
CustomerSpecific Requirements​
Organizational Analysis​
R&O Analysis​
Specific technical inputs(see next page)​​

ACTIVITIESSupport Risk Assessments
and Environmental
Aspect’s analysis​
Define Roles and responsibility​
Create Training tools(TN Academy and Talent LMS)​
Maintain Global
Sustainability System​
ESG Report and IR support​
Maintain Minimum
Technical Standards ​Perform Audits (in presenceor remotely, where possible)​
GSS Training​
Specific Global Sustainable
Development activities(see next page)​

KPIs

KPIs from R&O analysis​
KPIs from OneTeam Software(HR Processes)​Specific KPIs (see next page)

OUTPUT

Compliance with the Laws
and Regulations​Certifications ​Safe Work conditions​
Respect the environment​
Energy Savings​
Sustainability AwarenessTraining ​Sustainability - Accountability​
POAs(according to the local laws)​
Other Sustainable
Development outputs(see next page)

RECEIVERS

Authorities​
Corporate Bodies​
Regions and Plants​
Employees​
Unions – Work Councils​
Sustainability Committee​
Customers​
Suppliers​
Investors

All TN PROCESSES

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

RISK ASSESMENT(S)Iso 5002 – Energy Assessments​
R&O Analysis
GSS-12.6.1-Risk Management-General
GSS-12.6.1.2-MGT_07_02_Risk Management Process and Committee (RMC)
GSS-12.6.1.2-Environmentale Aspects
GSS-12.6.1.2-Safety&Health-Identification and Assesment of the Risk

CRED
NOTE

131

RESOURCES

All employees
and TN organizational levels

ADDENDUM
GLOBAL SUSTAINABLE DEVLOPMENTGEN

SOURCES(previous page)

SPECIFIC TECHNICALINPUTS
Energy consumptions
Raw materials consumptions
Waste disposal
Water consumption
Energy prices
CO2 reduction targets
Sustainability Roadmap
Customers Sustainability
Requests

SPECIFIC GLOBALSUSTAINABLE
DEVELOPMENTACTIVITIESKPIs & results calculation& monitoring
Monthly, Quarterand Yearly reviews
Sustainable Committee presentations​Sustainability workshops
Sharing best practices
with Customers and Suppliers
IR Support
Coordinate and support plants
in developing Sustainability projects
Customers Sustainability
questionnaires

OUTPUT

Monthly/quarterly
yearly reports
Sustainability Targets
achievement ​Sustainability roadmap
updates and reviews
Projects development
action plan & status
Customers complianceabout sustainability
Environmental performances
Suppliers

RECEIVERS(previous page)

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

TOOLS

(previous page)

SPECIFIC KPIs

Carbon Footprint
CO2 total emissions
Energy intensity
Water footprint% of recycled waste% of green energy

RISK ASSESMENT(previous page)

CRED
NOTE

133

SWOT
ANALYSISHELPFULHARMFULTO ACHIEVINGTHE OBJIECTIVE

TO ACHIEVINGTHE OBJIECTIVEGENSTR

As regards the analysis of the context, thetool we use is that of the SWOT Analysis,
even as early as 2024 we will be working
on the analysis of double materiality, also
taking into account the fact that in Europe
the non-financial reporting regulations
have changed with the Corporate Social
Responsibility Directive (CSRD) which will
impact 3 of our production sites.

INTERNAL
ORIGINQ

ATTRIBUTES OF THE
ORGANIZATION

SOC
GOV

STRENGTHS

Our SWOT Analysis has been developed by
the Sustainability Committee, and validated
by the Management Committee

WEAKNESSES

SUST
SOC

INTERNAL
ORIGINSUPP

ATTRIBUTES OF THE
ORGANIZATION

IND
CRED

OPPORTUNITIESTHREATS

NOTE

135

STRENGTHSSWOTANALYSISOPPORTUNITIESConcrete commitment of the company and top management
Company is oriented to Sustainability​
Robust sustainability strategy
Global Sustainability System
and Minimum Techincal Standards, global integration
Target approval process with SBTI ongoing and CDP
participation – reliable & transparent targets and results​
Sustainable Development structure,
Sustainability Committee​
ESG report
Robust sustainability Actions, KPIs and monitoring system
Demonstrate a clear willingness of Tsubaki Nakashima
toward all investors in achieving CO2 reduction results​
Good results achieved already in 2023
2024-2028 investments for sustainability projects
already approved

Old plants and old machines; some limits to implement
the best technology and or sustainable solutions
The benefits of sustainability-related projects
are not understood, in some cases
Energy Management not always perceived
as an opportunity to be more competitive
In some cases, limited technical skills in the plants
Difficulty to collect reliable data about waste,
raw materials emissions, use of chemical products etc.
Ability to monitor financial impacts of sustainability
risks and opportunities
Allocation of sustainability investments to other projects
as they are deemed more important and higher priority
Succession planning for Sustainability related roles

SWOT

New regulations pushing the organization to enlarge the view
In Japan, “Sustainability-related policies and initiatives”
are now required to be included in securities reports
and other documents.
Customers and opportunities to grow;sustainability means a greater chance of getting new business.
Integrate Carbon Footprint into quotation/offer process
and track % of quotes selected for that
Improving competitiveness through more sustainable products
New technologies able to reduce energy and natural
resources’ consumptionMore recycling culture

WEAKNESSESSTR
Q

The result of this SWOT is a document called RISKAND OPPORTUNITIES ANALYSIS, in which all theelements are analyzed in detail: stakeholder’sinvolvement, potential success or failure,potential consequences, positive and negative,
measuring systems (Occurrence and Severity),
action identified and as well as the KPIs to be
included in the GOALS AND OBJECTIVES, whichis the consequent step, allowing us to track thetrend on monthly basis.

Increase of costs necessary for thesustainability transformation
Increased costs related to green energy certificates
Evolving regulatory landscape impacting
sustainability compliance.
Green energy availability
Natural disasterCustomers without a real interest in Sustainability
Suppliers not in alignment with TN’s sustainability goals
Loss of reliability with investors and customers due to failure
to meet expected targets.
Intense competition may challenge thecompany’s sustainability leadership

GEN

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

THREATS137

Tsubaki Nakashima places great
importance on maintaining andbuilding relationships of trustwith its stakeholders based onlong term collaboration.
We engage with a diverse groupof stakeholders around theworld, including the people who
manufacture our products (ouremployees, our contractors,
our agents), the communities
we work in, the Customers andSuppliers that we work with andthe Investors who make our work
possible.
Through these collaborations, we
are working toward co-creatng
an equitable and regenerative
future. We aim to center ourbusiness strategy, investments,
engagement and reportng on
the environmental, social andgovernance (ESG) topics that are
most important to our businessand our stakeholders across ourvalue chain.
As we seek to accelerate ourprogress — and leverage our sizeand scale to beneﬁt people, theplanet, and our business — our
ESG priorities guide our actions
in a cohesive, compelling andrisk-minded manner. In order tohave a common but also speciﬁc
approach to our Stakeholders andrespecting the ISOs requirements,
we are dividing them into two
main categories: internal andexternal.

STAKEHOLDERS

INTERNAL STAKEHOLDERS
are represented not only by shareholders
and company management, but above all by
employees and collaborators, the heart ofthe company, who are in direct contact withcustomers every day, representing Tsubaki
Nakashima. The company strongly believes in
the integration and concrete motivation of its
employees by stimulating training at 360° andin particular on fundamental issues such as
safety at work and the principles established by
the highest ethic’s standards. Shareholders andcompany management guide the strategy andoperations of the Company in compliance withand sharing ethical and moral principles.
EXTERNAL STAKEHOLDERS
include suppliers and contractors, who are
selected through a precise evaluation system,
as well as based on compliance with theprinciplesgoverned by our QMS and GSS:
being a supplier of Tsubaki Nakashima means
committing to extend the same ethical principles
that guide the company also to its supply chain
and along the entire value chain. A relevant
external stakeholder is the Customers.
Both categories of stakeholders (internal andexternal) have legitimate expectations regarding
the work of Tsubaki Nakashima and, in relation
to the most relevant stakeholders, the possibilityof expressing opinions and suggestions, bothin clear and anonymous (i.e. Surveys), throughvarious sharing tools made available by thecompany and with periodic meetings. Thanks
to these listening processes, the company has
the opportunity to understand their needs andevaluate them to improve its activities andits impact on them. In general, stakeholder
involvement takes place in compliance withthe principle of inclusiveness, through which
Tsubaki Nakashima undertakes to encourage theactiveparticipation of all internal stakeholders incorporate life and strategic decisions.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

139

LEGISLATOR AUTHORITIESREGULATORY AGENCIESSUPERVISORSCUSTOMERSGENMEDIA AND SPECIAL
INTERESTED PARTIESSTR

EXTERNALSTAKEHOLDERS

INTERNALSTAKEHOLDERS

WORKERSSTAKEHOLDERSCOMMUNITIES

Q
SOC
GOV

TOP MANAGEMENTSTOCK EXCHANGE

BOARD OF DIRECTORSINVESTORSCONTRACTORSAND SUBCONTRACTORS

WORKERS’
REPRESENTATIVES

SUST
SOC
SUPP
IND

COMPETITORSCREDSHAREHOLDERSSUPPLIERS

NOTE

141

SUS
TAIN
ABIL
ITY

THE JOURNEY TO ACHIEVE THE TAILOR-MADE
SUSTAINABILITY STRATEGY FOR TSUBAKI NAKASHIMA
Tsubaki Nakashima strongly believes in the sustainable transformation of its processes
and products. From several years Tsubaki Nakashima has pursued the path of sustainable
development, and it has taken a proactive standing in fighting climate change.
The needs to transform our Company, that is listed on the stock exchange, in a sustainabledirection arise from external factors such as national and international climate change regulations,progressive demands from stakeholders to reduce their carbon footprint, opportunities toexpand their business in sustainability-conscious markets, and also from internal factors such as
the increased willingness of investors to bet on sustainable companies, greater risk avoidance
and management, the need to seek efficiency in areas not always well explored, such as the
management of available resources, and more generally from a sense of ethics and morality
towards its employees, communities and future generations.
Consequently, the definition of a clear long-term strategy, an investment plan in plantmodernization and process innovation, the research for alternative energy sources, including
self-produced ones, the definition of a precise organization with new roles and competencies,
a management system based on international standards and careful analysis of results, anda precise internal and external communication strategy allow for greater competitiveness,
expansion of markets, greater attractiveness (investors, candidates, customers, suppliers) andabove all profit, hence solidity and future perspectives.
Tsubaki Nakashima’s sustainability journey will not stop until carbon neutrality has been achievedin the true meaning of the word “Sustainability” which means “simultaneous achievementof economic prosperity, in a healthy and socially equity environment for current and future
generations.”

GEN
STR
Q
SOC
GOV
SUST
SOC

Focusing on the aspects of climate change, for Tsubaki Nakashima, the necessity and a sense ofurgency has grown to develop a sustainability strategy so as to improve processes and facilities
not only from the standpoint of CO2 reduction and carbon footprint but also from the standpointof profit and innovation. This is where profit, sustainability, and innovation are merged into asingle strategy, which is the roadmap for sustainable development and is perfectly rooted
in the overall sustainability system we have developed to properly guide the company’ssustainable growth.

SUPP

Through the implementation of this strategy, successful results have been achieved in termsof CO2 reduction, cost savings, improved production efficiency, and clearly technological andinnovation progress.

NOTE

Innovation and technological development are thus the tools through which Tsubaki Nakashima
pursues continuous improvement and contributes to a more sustainable future and businessgrowth.

IND
CRED

143

SUS
TAIN
ABIL 2022
ITY

During 2022 Tsubaki
Nakashima developed asustainability strategy thatwas based on achieving
the 2030 CO2 emission
reduction target
This strategy was based on
4 different pillars:

Adopt innovativetechnologies
to produce
green energy

Purchasegreen energy
thanks to therenewable energy
certificates

Reduce energy
consumption

Challenge:
improve
the generalefficiency
of TN plants
throughhigh utilization

2023
this sustainability strategy
was revised in light of:

STRATEGYUPDATE

Updating the 2030
CO2 emission reduction
target with the new
methodology proposedby SBTi

GEN
STR
Q

Studies andanalysesdeveloped

SOC

Technologicalinnovationin the field ofsustainability

GOV
SUST
SOC

Sustainability
projects
developed andresults achieved

SUPP

Workshops,
comparison andbenchmarking
with the sustainability
strategies of customers
and other industries

IND
CRED
NOTE

145

Therefore, thanks to the expertise acquired, thecareful analysis of the responses of our factories
to the projects developed, and the continuous
benchmarking with other companies, the strategy
has been modified by adding a new pillar related tothe electrification of our plants. The strategy turns
out to be tailor-made for the Tsubaki Nakashimaplants and this has been demonstrated by theexcellent results obtained during 2023 related tothe improvement of the carbon footprint and theimportant reduction of CO2 emissions achieved.
In order to transparently demonstrate and measure
Tsubaki Nakashima’s real commitment, a public
disclosure was made in 2023 on setting CO2
reduction targets in line with the Paris Agreement
and thus the methodology proposed by Science
Based Target.
In addition, driven by continuous improvement andin order to be increasingly accurate and reliablein calculating our emissions, Tsubaki Nakashima
decided to adopt the “market-based” method
for calculating emissions related to electricity
consumption. This made it possible to analyze thespecific emission factors of our electricity suppliers.
The result we obtained is that the fuel mix used byour electricity suppliers is more sustainable than the
averages of the different countries where our plants
are located.
The next chapters will disclose the new CO2
reduction targets, the new sustainability strategy
and the recalculation of CO2 emissions with the
new “market-based” factors, as well as the projects
developed and the results obtained.

Science Based Targets initiative

SUS
TAIN
ABIL
ITY

Defines and promotes
best practice in emissions
reductions and net-zerotargets in linewith climate science
Develops standards,
tools and guidance
to enable companies to set
science-based targets
in line with the latest
climate science
Through its validation
services arm,
assesses and validates
companies’ targets
The SBTi mobilizes
the private sector to takethe lead on urgent
climate action.

The Science Based Targets initiative (hereafter SBTi) isa corporate climate action organization that enables
companies worldwide to play their part in combating
the climate crisis. SBTi develops standards, tools andguidance which allow companies to set greenhousegas (GHG) emissions reductions targets in linewith what is needed to keep global heating below
catastrophic levels and reach net-zero by 2050 at
latest.
The SBTi is incorporated as a charity, with a subsidiary
which will host our target validation services. Oneof the partner of SBTi is Carbon Disclosure Project(hereafter CDP), organization that monitors theenvironmental impacts of companies, and which
Tsubaki Nakashima already joined in 2022.
SBTi’s main purpose is to communicate strongly andclearly that we must urgently increase ambition in thefight against climate change.
For this reason, SBTIs shows companies how muchand how quickly they need to reduce their greenhousegas (GHG) emissions to prevent the worst effects ofclimate change.

SBTi

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

147

During 2023 Tsubaki Nakashima commits to set
NEAR-TERM SCIENCE BASED TARGETS.
Tsubaki Nakashima’s commitment to SBTi isa significant milestone for the Sustainable
Development of the company. By embracing
sustainability and setting ambitious Science
Based environmental goals, Tsubaki Nakashima
is taking a proactive standing in fighting climatechange and contributing to a more sustainable
future and growth. The SBTi that are ambitious
and transparent CO2 reduction goals provide
Tsubaki Nakashima with a clear framework toassess its environmental impact and create
strategies that contribute to a sustainable future.
These targets include emissions from a company’s
operations, supply chain, and products, ensuring
a comprehensive approach to mitigate climatechange. SBTs that are independently verified,giving stakeholders confidence in the organization’scommitment to reducing its carbon footprint. The
commitment made by Tsubaki Nakashima aligns
with the growing trend of companies recognizing
the need for urgent action and embracing theirrole in protecting the environment for future
generations.
Because of its commitment to Science Based
Target, Tsubaki Nakashima recalculated its scope 1
and scope 2 CO2 emission reduction targets. The
targets set in 2019 and used in previous years werestill in line with SBTi’s methodology but due to thefollowing changes the recalculation was necessary

SUS
TAIN
ABIL
ITY

1

CO2 TONS

Therefore, Tsubaki Nakashimarecalculated 2024 – 2030
absolute CO2 emissions
targets in light of:Commitment and new
methodology proposed by SBTi:
SBTi’s new methodology
includes more demanding targets.

OLD TARGETS
YEARS
172.844 2024
166.1402025

92.346

159.4362026

86.591

2

3

New baseline year:
the year 2022 was chosen
as the baseline year because
it is appropriate to choose
one of the most recent years.

GEN
STR
Q

152.7312027

80.837146.0272028

75.082

GOV

139.3232029

69.328SUST

132.619
Market based methodology
for Scope 2 emissions and thennew emission factors for electricity.
The new emission factors used
are specific to the electricity suppliersof our plants and thus proved
more accurate (marketbased method) than those used
so far, which instead reflected
a country average(location-based method).

NEW TARGETS
98.1002030

63.573-27,5%-42%

VS. 2019

VS. 2022
The recalculated targets have not yet been validated by SBTi because
Tsubaki Nakashima is analyzing its own scope 3 emissions, indirectemissions, which are a mandatory requirement of SBTi. In this regard,in addition to the scope 1 and scope 2 targets, a target for scope 3
emissions will also be set. This is another important milestone in
the fight against climate change because setting a target on indirectemissions (scope 3) means involving Tsubaki Nakashima’s entire
supply chain in its sustainability strategy.

SOC

SOC
SUPP
IND
CRED
NOTE

149

OLD STRATEGY

SUS
TAIN
ABIL
ITY
Tsubaki Nakashima’s new strategy forsustainable development is based on
the key concept of sustainable corporate
growth. Therefore, all pillars have thedual purpose of limiting CO2 emissions
and environmental impacts of plants andimproving our organization’s efficiency,
profit, innovation, and competitiveness.
Compared with the strategy developed
last years, the pillar related to theelectrification of our plants has been
added, and the pillar related to green
energy production technologies has
been changed because as of today,
given the technological development
and given the peculiarities of our plants,
only solar photovoltaic is agreed upon
and applicable.

NEW STRATEGY

ReduceReduceenergy consumption energy consumption
Adopt innovativetechnologies
to produce
green energy

Photovoltaic
systems

Purchase green
Purchase green
energy thanks to the energy thanks to theRenewable Energy
Renewable Energy
Certificates
Certificates
Challenge: improve Challenge: improve
the general efficiency the general efficiency
of TN plants through of TN plants throughhigh utilizationhigh utilization
Electrificationof TN plants-27,5%-42%

CO2 tons by 2030

CO2 tons by 2030

The following is the explanation pillar by pillar of
Tsubaki Nakashima’s sustainable development
strategy:
REDUCE ENERGY CONSUMPTION
Energy efficiency projects allow Tsubaki Nakashima’s
plants to reduce and optimize the energy
consumption. Through new machineries, throughoptimized use of our equipment, through careful
maintenance, through monitoring our consumption,and through the adoption of innovative energy
efficiency technologies the energy consumptionof our plants will decrease. Thus, these projects
aim to reduce Scope 1 and Scope 2 emissions andhave the benefit of improving plant efficiency by
reducing energy costs. Energy efficiency measures
are constantly evolving, we are learning from ourplants and we are testing and implementing energy
efficiency projects that have led us to a 5% decrease inenergy intensity (energy consumption / production)by 2023.
PHOTOVOLTAIC SYSTEMS
Photovoltaic systems will be used to produce
zero-emission electricity. Solar energy, being anatural source, so the electricity produced will begreen energy. Therefore, through the widespread
installation of photovoltaic systems in our plants wewill reduce Scope 2 emissions (emissions related
to electricity consumption) and also increase ourshare of green energy. These projects are a concretecommitment to our green transition.
PURCHASE GREEN ENERGY THANKSTO THE RENEWABLE ENERGY CERTIFICATES
Purchasing green energy is a skillful tool for lowering
Tsubaki Nakashima’s Scope 2 emissions. In addition,
through corporate green power purchase, electricity
suppliers will be increasingly incentivized to build
new renewable energy power plants (wind farms,
photovoltaic parks, hydroelectric power plants etc..)
so we believe that this is also a key pillar in fighting
climate change at the forefront and in our green
transition. This tool will be especially useful in ourplants where, due to geographical characteristics(solarirradiance/weather/exposure)and/orconstruction characteristics (roofs), it is not possible
to install photovoltaic systems.
CHALLENGE: IMPROVE THE GENERALEFFICIENCY OF TN PLANTS
THROUGH HIGH UTILIZATION
Through better utilization of our factories (optimized
productivity, optimized work weeks and break days
based on customer demands, etc.) we will go on to
reduce CO2 emissions. In fact, the environmental
sustainability of our plants is also related to production
efficiency. The more efficient the production,
the more sustainable the plant. Here, this pillar isthe perfect example of how Tsubaki Nakashima’s
sustainable growth not only impacts CO2 emissions
but also profit and competitiveness.
ELECTRIFICATION OF TN PLANTS
In order to lower the Scope 1 emissions to ZERO(emissions related to the use and combustion of fossil
fuels in our factories), the sources of emissions must
be directly eliminated as currently there is not yet acertified, international mechanism with reasonable
prices for the purchase of “green” fuels (for example
bio methane or bio gas). In our plants, the facilities that
consume fossil fuels and thus cause Scope 1 emissions
are mainly: furnaces and atmosphere gases, handlingforklifts, and ambient heating equipment. Therefore,
electrification projects are aimed at converting thesefacilities into electric systems so that green electricity
can be used or produced by photovoltaic plants orpurchased. This pillar is perfectly in line with anddriven by technological innovation in the electric
sector. Therefore, through electrification, not only
will CO2 emissions be reduced but also technologicalimprovement of our factories will be achieved.
Despite the new, much more restrictive targets, the
new sustainability strategy turns out to be in line
and compliant. Its effectiveness has been tested on
the results achieved in 2023, which will be shownin the next chapters.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

151

CARBONDISCLOSURE
PROJECT

Carbon Disclosure Project (hereafter CDP) is a not-for-profit charity that runs the global disclosuresystem for investors, companies, cities, states and regions to manage their environmental
impacts. The world’s economy looks to CDP as the gold standard of environmental reportingwith the richest and most comprehensive dataset on corporate and city action. The aim of CDP isto see a thriving economy that works for people and planet in the long term. CDP focus investors,
companies, cities and governments on building a sustainable economy by measuring and acting
on their environmental impact.

The main values of CDP are:
CDP defaults to transparency
CDP places accountability at its heart
CDP learns and improves
CDP believe in succeed together
As the world takes steps towards building a climate safe, deforestation free, water secure future,ambitious corporate action is more crucial than ever. Disclosure through CDP provides the
bedrock for this. As the world’s most comprehensive dataset, CDP’s data both fuels and tracks
global progress towards building a truly sustainable economy for people and planet.
As well as meeting the demands of your investors and customers, reporting your environmental
data through CDP enables Tsubaki Nakashima to protect and improve its company’s reputation,
boost its competitive advantage, uncover risks and opportunities, and track and benchmark
progress. In a world where mandatory disclosure is gaining momentum, disclosing through CDP
also helps Tsubaki Nakashima get ahead of regulation.
For that reason, during 2023 Tsubaki Nakashima participated in CDP questionnaires for climatechange (full version) and water security (minimum version). CDP questionnaires enables
Tsubaki Nakashima to progress towards environmental stewardship through benchmarking andcomparison with peers, in order to continuously improve its climate governance.
Tsubaki Nakashima obtained Level B- for the “Climate Change” category, which, in addition to
being the third level of eight, is also higher than the Asia regional average of C, and higher thanthe Metal products manufacturing sector average of C.
Strengths that emerged from the CDP: Business Strategy, Financial Planning & Scenario Analysis,
Energy, Governance, Scope 1 & Scope 2 emissions, Targets, Value chain engagement.
The score received shows that the sustainability strategy has been set up correctly and is strong
and reliable. Tsubaki Nakashima has already started the process of improvement to score betterand fill in the gaps in the areas where it received the lowest scores.
Tsubaki Nakashima obtained Level C for the “Water security” category, which is in the Awarenessband. This is the same as the Asia regional average of C, and the same as the Metal products
manufacturing sector average of C. Water impact does not appear to be a key indicator for theorganization with respect to CO2 emissions for that reason Tsubaki Nakashima currently focuses
its attention on reducing GHG emissions but nevertheless it also keeps the water consumption
under control.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

153

During 2023, several workshops
relatedtoenvironmental
sustainability were carried out.
The purpose of these on-site
workshops was to increase theplants’ awareness of climatechangeandenvironmental
sustainability issues. In addition,
on-site analyses were performed
to evaluate the implementationof the sustainability roadmap andto study and follow-up on theopportunities for improvement.

SUS
TAIN
ABIL
ITY

To follow up on the workshop
carried out in 2022 and tomeasure the effectiveness of theactions and projects developed asa result of the workshop, in 2023,
the plants in Georgia (US) and
Poland were visited again. Huge
improvements were identified
that confirmed the effectivenessof the projects developed
and the sustainability strategy
implemented. More strategic
projects were then analyzed
and proposed with a view tocontinuous improvement that will
be developed in the coming years.

2
5

Projects
alreadydeveloped
Energy efficiency
projects analyzed
for cointinuous
improvement- 840 CO tons/y2

Workshop
performed

4

7
15

Projects
alreadydeveloped
Projects
identified

Poland5
4Energy efficiency
projects alreadydeveloped
Energy efficiency
projects analyzed
for cointinuous
improvement- 1.596

CO2 tons/y

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

155

In 2023, plants producing for the
medical sector were also visited,since this business has potential
growth in the coming years.
Again, with a view to sustainable
and profitable growth, the twoplants in Michigan (US) and
Italy were analyzed in order to
identify opportunities to improvesustainability and to measure theadherence of the sustainability
strategy to these production
processes, which are very different
from the production of steel
balls. Thanks to the performed
analyses, the strategy appears tobe effective and partially already
implemented in these plants. It
is reported that the Italian plantis in line with all 5 pillars of thestrategy in that:
All the energy efficiency
best practices are already
implemented;

SUS
TAIN
ABIL
ITY
6

31
- 15.962

Sustainability
Projects
Developed in 2023

CO2 tons/y(+ 114% vs 2022)

Michigan- 840

Energyefficiency
projects
identified

Photovoltaic system is alreadyinstalled on the roof of the plant;
100% of green energy
purchasing through Guarantessof Origins (GOs);
High production efficiency;
The plant is already electrified(fossil fuels consumption).

To demonstrate Tsubaki Nakashima’s
concrete commitment to fighting climatechange and meeting promised targets,during 2023, several projects weredeveloped. Thanks to the sustainability
projects developed, 15.962 emissionsof CO2 tons were avoided, and Tsubaki
Nakashima’s carbon footprint improved
by 8% with respect to 2022. With an eye
toward continuous improvement andthanks to the experience gained and theresults achieved in 2022, 31 projects were
implemented in 2023 compared to 26
implemented in 2022, which, however,resulted in CO2 emission reduction benefitsof +114% compared to 2022.

Italy
TN Rispa
is the first plantwith no CO2emissions

CO2 tons/y

39%-20 GWhGreen energy(+ 13% vs 2022)
of energy
consumption

Installation of aphotovoltaic system
in Kunshan plantChina
2,5 -CO774
tons/y751
MWpinstalled2

MWh of green energy
produced in 2023 (Sep-Dec)
Green energy Purchasing
through International Renewable
Energy Certificates - IRECs in
China - Taicang Plant

Despite budgeted sustainability projects,
after the Q2 results the carbon footprint
and CO2 emissions were not in linewith expectations and especially thepromised targets. For this reason, Tsubaki
Nakashima decided to allocate additional
investment and 3 special projects weredeveloped in August 2023 aimed atrecovering the plan and achieving theCO2 reduction targets promised toinvestors and customers. As a result of
the allocation of these extraordinary
funds and the development of the 3
special projects, excellent results wereachieved and most importantly, thepromised 2023 targets were met. Thisis a clear and strong evidence of thewhole organization’s commitment tosustainable development.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

-10.300
CO2 tons/y

157

KPIs

Tsubaki Nakashima has set up and monitors
several KPIs to measure its sustainability
performance and the effectiveness ofsustainability strategy.
CO2 emissions [CO2 tons]: the total CO2
emissions of Scope 1 & Scope 2 are monitored
on a monthly basis and calculated taking into
account the guidelines provided by the GHG
Protocol and the ISO 14064. During 2023,
Scope 2 emissions, that are mainly related toelectricity consumptions, are calculated using
both the Location Based and Market Basedmethodologies. Market Based methodology
results to be more accurate and it is more inline with the real situation. That is why from2024 onward it will be used as the primarymethod for calculating Scope 2 CO2 emissions.
Considering the updated guidelines andtarget calculation method proposed by SBTi,and considering the change in calculation
methodology for Scope 2 emissions, the 2030
CO2 emissions reduction target of Tsubaki
Nakashima was updated and it is presented in
the next section.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

159

CHINA
59.945 CO2 TONSEUROPE
53.960 CO2 TONS

2023

CARBONFOOTPRINT

AMERICAS
9.679 CO2 TONS
JAPAN
10.540 CO2 TONSCERAMIC
2.453 CO2 TONSEUROPE
38.426 CO2 TONSTSUBAKINAKASHIMA
23.462CO2 TONSMEDICAL
1.765 CO2 TONS

Carbon footprint [CO2 tons/tons]:
Tsubaki Nakashima carbon footprintis calculated taking into account
Scope 1 & Scope 2 emissions and the
production expressed in tons. This KPI
reflects the sustainability of Tsubaki
Nakashima factories and targets are
set up taking into account the planned
CO2 reduction and the organization’s
future rate of production.

CHINA
32.885 CO2 TONSAMERICAS
19.522 CO2 TONS
JAPAN
23.944 CO2 TONSCERAMIC
3.654 CO2 TONSQ
SOCAVOIDEDCOMPARED TO 2022

CO2 TONS / TON*During 2022 the Americas
region also included the medical
plant located in US Michigan.
From 2023 onward, the medical
plant is in the new "Medical"
region. In order to make aproper comparison, the 2022
results for the Americas region
were recalculated excluding the
medical plant; this explains thedifference in the carbon footprint
values from what was reported
in the previous 2022 ESG report.

STR

TSUBAKINAKASHIMA
15.014
CO2 TONSMEDICAL
612 CO2 TONSAVOIDEDCOMPARED TO 2022

LOCATIONBASEDRESULTS

GEN

2022

2023

%
2023
VS 2022

2,56

2,41

-6%

1,40

1,44

31,40

CO2 TONS / TON

GOV

2022

2023

%
2023
VS 2022

JAPAN

1,14

1,10

-3%

2%

EUROPE

1,02

1,04

1%

28,80

-9%

CERAMIC

21,5

19,3

-11%

IND

2,16

1,79

-20%

CHINA

1,20

0,99

-20%

CRED

1,69

1,57

-7%

AMERICAS*

0,92

0,81

-14%

NOTE

3,89

4,38

+11%

MEDICAL*

1,28

1,52

+15%

1,88

1,74

-8%

TSUBAKI NAKASHIMA

1,11

1,03

-8%

SUST

MARKETBASEDRESULTS

SOC
SUPP

161

Category 1
Category 4

Upstream transportation

we started to calculate and analyze
the emissions related to thetransportation of raw material fromour suppliers’ warehouses/factories
to our plants. In this case, the “Distance-based method “ was usedwith the emission factors given by the“DEFRA” database.

in 2023 Tsubaki Nakashima started
the screening and calculation of scope
3 emissions (i.e. indirect emissions
linked to the supply chain). We
started by calculating the emissions
that we consider most impactful andmost significant for our organization:
raw materials, transportation, andwaste. The calculation methodologies
adopted that follow the guidelines
proposed by the GHG Protocol are
explained in these pages.

SCOPE 3

Raw materials

considering the huge estimated impact of these emissions,
we decided to proceed with the “ Supplier-specific method “which is the most accurate and reliable. For this purpose, aquestionnaire was sent to all raw material suppliers to fill out
regarding the carbon footprint for products sold to Tsubaki
Nakashima; this carbon footprint, expressed in CO2tons/tons,
was then multiplied by the amount of material purchased in
2023. The emissions for the two main raw materials that arepurchased are shown below: steel wire and ceramic blanks(semi-finished ceramic ball material). These analysis is not
only useful in order to estimate the CO2 emissions but it isan indicator that we will keep relevant for future business
continuity and procurement strategies.

Category 5

Waste generated in operations

also in this case, as with the raw material, it is strategic
for us to analyze emissions related to waste since we are
analyzing circular economy projects that will therefore leadto significant improvements. In this case, the “ Waste-typespecific method “ was used with emission factors derived
from the Ecoinvent database or from specific sector studies/
papers and our main wastes were considered.

EMISSIONS
CO2 TONS

Category 9

Downstream transportation
we started to calculate and analyze
the emissions related to thetransportation of products from ourplants to our customers’ warehouses/
plants. As for the upstream
transportation, the “ Distance-based
method “ was used with the emission
factors given by the “DEFRA”
database.

GEN
STR
Q

SCOPE 3
(CO2 TONS)

2023

RAW MATERIALS

152.792

GOV

WASTE

22.412SUST

UPSTREAM
TRANSPORTATION

11.666SOC

DOWNSTREAM
TRANSPORTATION

16.433SUPP

TSUBAKI NAKASHIMA

203.312

SOC

IND
CRED
NOTE

163

2023 GREEN ENERGYENERGY
CHINA
49%

+5%

energy efficiency

AMERICAS
49%
JAPAN
29%
CERAMIC
28%

EUROPE
31%

39%

Green Energy

Energy Intensity [MWh/tons]
this KPI is the ratio between energy
consumption
andproduction
expressed in tons and this is anindicator of the energy efficiency
of Tsubaki Nakashima factories.The
lower this KPI and the higher isthe energy efficiency of Tsubaki
Nakashima.

JAPAN

3,3

3,9

EUROPE

2,93,0

CERAMIC

2,7

3,8

JAPAN
EUROPE

3,4

2022

2023

3,54

3,96

+11%

2,22

-10%

CERAMIC

44,0

43,9

-1%

CHINA

2,11

2,08

-2%

AMERICAS*

3,12

2,69

-16%

MEDICAL*

5,94

7,07

+16%

TSUBAKI NAKASHIMA

2,62

2,49

-5%

*During 2022 the Americas region also included the medical plant located in US Michigan.
From 2023 onward, the medical plant is in the new "Medical" region. In order to make aproper comparison, the 2022 results for the Americas region were recalculated excluding
the medical plant; this explains the difference in the carbon footprint values from what
was reported in the previous 2022 ESG report.​

WATER
-4%

water footprint(compared to 2022)

25

millions litersof water saved(compared to 2022)

2,3

GEN
STR

AMERICAS%
2023
VS 2022

2,45

CHINA

(+13% compared to 2022)+13%
COMPARED TO 2022

% of green energy: this indicator isuseful to monitor the amount of green
energy consumed by the organizationand to properly set the strategy onpurchasing and self-producing green
energy and to monitor the results
obtained. Tsubaki Nakashima plans to
consume 100% renewable electricity
by 2040. The % of green energy is
calculated by taking into account thecountry-specific fuel mix, green energy
purchased through Renewable Energy
Certificates, and self-generated green
energy from photovoltaic systems
installed in the plants.

2023(compared to 2022)

TSUBAKINAKASHIMA
39%

MEDICAL
67%

2022

0,4

1,84

MEDICAL

2,5

0,2

TSUBAKI NAKASHIMA

2,8

2,7

Water footprint [m3/tons]: is the ratio between water
consumptions (m3) and the production expressed in tons.
Tsubaki Nakashima currently monitors this indicator as
another key aspect of a company’s sustainability, but because
no major deterioration is found, a long-term target has notbeen set but only annual targets for monitoring. In addition,
this indicator does not appear to be a key indicator for theorganization with respect to CO2 emissions and carbon
footprint for that reason Tsubaki Nakashima currently
focuses its attention on reducing greenhouse gas emissions
but it also keeps the water consumption under control.
Tsubaki Nakashima water consumption in 2023 was equal to
252 million liters. Considering that, in average, one person
consumes 237 liters of water per day, Tsubaki Nakashima
water consumption during 2023 is equivalent to the annual
water consumption of about 2,800 people.
The water footprint of Tsubaki Nakashima during 2023 wasequal to 2,7 liters/kg (i.e. m3/tons) and this value is very
low compared, for example, to the water footprint of beef
production 15,000 liters/kg.

Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

165

RECYCLED
RATE

In 2023 Tsubaki Nakashima has
defined a collaboration with the
Polytechnic of Turin for a Ph.D. on
waste (sludge) recovery from acircular economy perspective. Such a
project will not only help improve the
KPI of recycling but will be an added
value for the company, turning a cost
into a benefit.

tons of waste
produced(compared to 2022)

WASTE RECYCLED(TONS / TONS)

Recycled rate reflects the percentageof recycling waste. In order to calculate
this KPI the most important categories
of waste are taken into account. Oneof the goal for 2023 is to develop
projects to recycle our production
sludge.

-3.468

SUS
TAIN
ABIL
ITY

GEN
STR

2022

2023

%
2023
VS 2022

JAPAN

67%

74%

+7%

SOC

EUROPE

34%

50%

+16%

GOV

CERAMIC

41%

52%

+11%

CHINA

42%

23%

-19%

Q

SUST
SOC
SUPP

AMERICAS*

32%

46%

+14%

MEDICAL*

24%

29%

+5%

TSUBAKI NAKASHIMA

41%

48%

+7%

IND
CRED
NOTE

167

SECURITYSCENARIOREPORT

What isthe security report is? Brief description
During 2023 Tsubaki Nakashima integrated
climate change aspects within the Security Reportfollowing the guidelines proposed by TCFD – Task
Force on Climate-Related Financial Disclosures.
Tsubaki Nakashima in its statements, vision,
mission and policy, demonstrate a clear
commitment to contribute to a decarbonizedsociety, achieving Carbon Footprint’s neutrality
by 2050. The Company believes that not only
supplying high-quality products, but also giving
due consideration to the environment and useof natural resources in the manufacturing anddemand chain processes will help reduce theenvironmental impact of the entire value chain.
For that reason, Tsubaki Nakashima takes a life
cycle thinking approach in eﬀorts to minimize
customers’ environmental impacts by providing
products that oﬀer environmental performanceand carried out a scenario analysis to understandrisks, opportunities and impacts of climatechange on the Company and its business, andespecially to examine the resilience of thesustainability strategy and, if necessary, further
countermeasures. As a time period, we took
into account 2030, the year in which we need toachieve our near-term goals with SBTi, and 2050,
the year in which we would like to achieve carbon
neutrality. Considering instead the scenarios weselected two different climate change scenarios:
1.5°C scenario (scenario to which our goals willbe aligned, established by the Paris Agreement)
and 4°C (low carbon and decarbonization will
not be promoted and physical risks will increase).
Risks and opportunities were indicated in the
below table.

FACTORCHANGER/O*

COUNTERMEASURES

Conversion to EV

Decreased demand for bearings’
steel balls

Risk

Achieve sustainable business growth by expanding sales inceramic business and develop strategy for green steel balls
production.

Increased demandfor bearings’ ceramic balls

Opportunity

One of the pillars of the medium-term strategy of Tsubaki
Nakashima is the development and growth of ceramic balls
business to support the EV markets.

Increase in raw materials costs
due to changing input prices(energy costs etc..)

Risk

Develop a robust sustainability strategy with raw materials
suppliers.

Customers’sustainability
requirements

Loss of business opportunities
due to delays
in decarbonization

Risk

Tsubaki Nakashima developed a tangible sustainability
strategy and joined also SBTi to adapt its sustainability goals
and targets with respect to the Paris Agreement targets andthen the 1.5°C scenario.

Carbon tax
and carbon
pricing

Increase in cost due to theintroduction of carbon tax

Risk

Tsubaki Nakashima sustainability strategy is based on
decarbonization of its plants and one of the pillars is strictly
related to the electrification of the plants by eliminating
fossil fuels consumptions.

Increased demandfor energy-saving andlow-emissions bearings

Opportunity

Increase in electricity
costs due to useof renewable energy

Risk

Raw materials
costs

1,5 °C

RenewableenergyRisk

Install renewableenergy systems

4 °C

Weather-related
disasters

Risk of shutdown due
to damage of our suppliers
or our plants

Opportunity

Risk

Tsubaki Nakashima sustainability strategy is based on
decarbonization of its plants and to the development ofenvironmentally friendly and highly efficient bearing balls.
One of the sustainability KPIs of Tsubaki Nakashima is the
specific energy consumption and we are improving YoY
this parameter. Moreover, two of the five pillars of oursustainability strategy can be adopted to mitigate this risk:energy efficiency improvements, photovoltaic systems
installation in our plants.
Installation of renewable energy systems and specificallyphotovoltaic systems is the second pillar of the sustainability
strategy. Such plants not only generate zero-emission
electricity but also generate economic benefits and make ourfactories more independent of fluctuations in commodity
prices in the markets.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

Implement the pillars of our sustainability strategy andinvolve our suppliers as well.

169

MANAGEMENT OFWATERDISCHARGE

Management of water discharge
Related impacts
In every Tsubaki Nakashima Co.
Ltd (TN (Tsubaki Nakashima)) Plant
we establish a program to ensurethat wastewater generated by its
operations is managed in accordancewith all applicable local, regional,
state, and national environmental
laws and regulations, and TN Global
Sustainability System (GSS) policies.

GEN
STR
Q

Negative environmental impacts in the supply chain
and actions taken
As mentioned in the description of the Global
Sustainability System, one of the fundamental tools
for understanding the context in which one operates
is risk assessment, in particular the Assessment ofEnvironmental Aspects referred to in requirement
6.1.2 of the ISO 14001 standard. Given the variegationof suppliers and supply chains and taking into accountthat the Carbon Footprint Scope 3 will be calculated
and disclosed in 2024, it is each individual factory that,
evaluating the environmental aspects, identifies thetype, the potential impact, the relevance, the actions
to mitigate its impacts and the way to measure theachievement of results, with a view to continuous
improvement

But before defining the plan, it is in the Evaluation of Environmental Aspects (6.1.2 of the ISO
14001 regulation) that aspects and impacts are identified, their significance is defined, andspecific actions are created to minimize them by a certain date.
Each wastewater management program has the following elements
Identification of all wastewater streams generated by Plant operations,
including process wastewater, cooling water, stormwater runoff, and domestic sewage
Identification of the composition, generation rate, location, point of release or mixing
with other surface waters, and ultimate discharge point of each wastewater stream
Procedures to control, and verify control of discharges,
as required by applicable laws, regulations, and TN GSS policies
A plan to reduce the total volume of, and the concentration of contamination
present in, each wastewater stream
Procedures to identify wastewater streams that require permits(prior to the permits being required)Procedures for obtaining permits. Permits must be kept current,and each Plant must ensure that it follows permit conditions
Procedures to update program as processes are deleted, added, or changed
A plan for preventing foreseeable contamination of wastewater streams
A plan for responding to an accidental release or discharge that includes
containment procedures, names of response personnel,
response equipment and materials, and required notification procedures.
As for all the other Company’s Policies, the Audit Plan has the scope to check the level ofconformity and, eventually, define corrective actions
					

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

171

BIODIVERSITY

During 2023, Tsubaki Nakashima started thelearning process regarding Biodiversity. For thatreason, we don’t currently have any targets or KPIs
related to biodiversity. However, Tsubaki Nakashima
has worked to improve its understanding of the
impact and dependencies of biodiversity as well as
associated risks and opportunities. Thanks to thespecific tool developed by WWF, Biodiversity Risk
Filter, we started the assessment of:
PHYSICAL RISKS that are driven by the ways inwhich a business and its supply chains depend on
and can be affected by both natural and humaninduced conditions of land- and seascapes, and howpressures might deteriorate ecosystem services in
the future.
REPUTATIONAL RISKS that can result from acompany’s actual or perceived negative impacts on
biodiversity and people. Reputational risk represents
stakeholders’ and local communities’ perceptions ofwhether companies conduct business sustainably
or responsibly with respect to biodiversity and canultimately affect brand value and market share,
among other factors. Adverse effects on businesscould emerge from, for example, damages to thecorporate brand and thus declining sales, or greater
investor scrutiny and thus declining share price.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

173

PHYSICALRISKS

PHYSICAL RISKS: the map shows the glocalizations of different plants that are classified basedon physical risks (red: high risk, light yellow: low risk).

1

21

2

4
3,5
3
2,5
2
1,5
1
0,5
0

20
19
18
17

3
4
5
6
7

16
8

15
9

14
13

12

11

10

Tsubaki Nakashima carried out both anassessment based on the geographicallocation of plants and also an assessment
based on the organization’s specificmarket sector. The results obtained areshown in these pages.

N

PHYSICAL RISKS FOR GEOGRAPHICAL LOCATIONSPLANT
LOCATIONRISK VALUE

1

Katsuragi plant

Katsuragi - Japan

3,35

2

Koryiama plant

Koryiama - Japan

3,35

3

Okayama plant

Okayama - Japan

3,40

4

Rispa

Mirandola - Italy

2,88

5

Sechibaru plant

Sechibaru - Japan

3,35

6

TN Bosnia

Konjic - Bosnia and Herzegovina

3,25

7

TN Chongqing

Chongqing - China

3,00

8

TN Georgia

Cumming Georgia - USA

2,98

9

TN Italy

Pinerolo - Italy

2,88

10

TN Kunshan

Kunshan - China

3,75

11

TN Michigan

Sault Ste. Marie Michigan - USA

2,53

12

TN Polska

Krasnik - Poland

2,88

13

TN Rayong

Rayong - Thailand

3,00

14

TN Slovakia

Kysucke Nove Mesto - Slovakia

2,88

15

TN Taicang

Taicang - China

3,75

16

TN Taiwan

Taichung City - Taiwan

3,40

17

TN Tennessee Erwin

Erwin Tennessee -USA

3,38

18

TN Tennessee Mountain City

Mountain City Tennessee - USA

3,38

19

TN UK

Worthing West Sussex - UK

2,88

20

TN India Silvassa

Silvassa - India

3,58

21

TN Tennessee Mountain City

Konjic - Bosnia and Herzegovina

3,58

As we can see from the charts, based on the geographical location, the fourth plants
with the highest physical risks are TN Kunshan and TN Taicang in China and the twoplants in India.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

175

REPUTATIONALRISKSREPUTATIONAL RISKS

1

21

4
3,5
3
2,5
2
1,5
1
0,5
0

20
By comparing the twoanalyses performed, it
appears that the plants
on which we will haveto start focusing ouranalyses, which are thoseat the greatest risk of
biodiversity, are:TN Kunshan
TN Taicang
TN India (2 plants)
TN Chongqing
TN Taiwan
TN Tennessee (2 plants)

2

19
18
17

3
4
5
6
7

16
8

15
9

14
13

12

11

10

As was done forphysical risks also
for reputational risks
map, table and graphare shown.

N

REPUTATIONAL RISKS FOR GEOGRAPHICAL LOCATIONSPLANT
LOCATIONRISK VALUE

1

Katsuragi plant

Katsuragi - Japan

2,62

2

Koryiama plant

Koryiama - Japan

2,62

3

Okayama plant

Okayama - Japan

2,62

4

Rispa

Mirandola - Italy

2,50

5

Sechibaru plant

Sechibaru - Japan

2,62

6

TN Bosnia

Konjic - Bosnia and Herzegovina

2,77

7

TN Chongqing

Chongqing - China

2,95

8

TN Georgia

Cumming Georgia - USA

2,69

9

TN Italy

Pinerolo - Italy

2,38

10

TN Kunshan

Kunshan - China

2,95

11

TN Michigan

Sault Ste. Marie Michigan - USA

2,69

12

TN Polska

Krasnik - Poland

2,17

13

TN Rayong

Rayong - Thailand

2,58

14

TN Slovakia

Kysucke Nove Mesto - Slovakia

2,44

15

TN Taicang

Taicang - China

2,95

16

TN Taiwan

Taichung City - Taiwan

2,95

17

TN Tennessee Erwin

Erwin Tennessee -USA

2,94

18

TN Tennessee Mountain City

Mountain City Tennessee - USA

2,94

19

TN UK

Worthing West Sussex - UK

2,75

20

TN India Silvassa

Silvassa - India

3,12

21

TN Tennessee Mountain City

Konjic - Bosnia and Herzegovina

3,12

As we can see from the charts, based on the geographical location, the six plants
with the highest reputational risks are TN Kunshan, TN Chongqing, TN Taicang in
China, TN Taiwan, and the two plants in Tennessee (USA).

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

177

RISK

PHYSICAL+REPUTATIONAL

INDICATORS

RISKS

N

PLANT

NUMBER OF SITES BY TOP 10 RISK INDICATORS

1

21

2

1

Katsuragi plant

2

Koryiama plant3

Okayama plant

4

Rispa

5

Sechibaru plant

6

TN Bosnia

7

TN Chongqing

8

TN Georgia

9

TN Italy

10

TN Kunshan

11

TN Michigan

12

TN Polska

13

TN Rayong

14

TN Slovakia

15

TN Taicang

16

TN Taiwan

17

TN Tennessee Erwin

Physical Risks

18

TN Tennessee Mountain City

Reputational Risks

19

TN UK

20

TN India Silvassa

21

TN Tennessee Mountain City

4
3,5
3
2,5
2
1,5
1
0,5
0

20
19
18
17

5.4 Pollution

3
4
5
6

8

15
9

14
11

10

1.3 Limited Wild Flora& Fauna Availability
6.1 Protected / Conserved
Areas
8.3 Sites of International
Interest

3

3.2 Fire Hazard
2.2 Water Condition

3

16
8

5

9

8

107

SUST

7
5

10

10
11

GOV
7

5

6

Q
SOC

14

1 3

STR

7
8

3

3.5 Extreme Heat
7.3 Labor / Human Rights

5

10
2

GEN

10

6

3.1 Landslides

7

12

10

3.6 Tropical Cyclones

16

13

1

SOC

6
5

6

SUPP
4

Thanks to the tool used, by attributing the organization's market
sector and the locations of the various plants, the 10 mostimpactful biodiversity drivers for Tsubaki Nakashima were also
identified.

IND
CRED
NOTE

179

RISK

INDICATORS

1
2
3
4
5

TOP 5 INDICATORS ARE DESCRIBED BELOW:

Pollution (5.4): this indicator is based on nutrient, pesticide and air pollution. Pollution is an importantdriver of biodiversity and ecosystem change throughout all biomes. A high risk score for this indicator
is a result of high impact of your industry on biodiversity through this pressure in combination withhigh location risk scores.
Tropical Cyclones (3.6): this indicator assesses the predicted maximum wind speed on a 50-year
return period. Storms can impact companies and value chains through a variety of ways, including
building and property damage, flooding or power outages, which may lead to temporary or
permanent company closures and loss of revenue. A high risk score for this indicator is a result ofhigh dependency of your industry on the absence or mitigation of this natural hazard in combination
with high location risk scores.
Landslides (3.1): this indicator assesses the potential threat of rainfall - and earthquake-triggeredlandslides. Landslides impose significant risks to human lives and economic activities. Landslides
have become more prevalent because of anthropogenic disturbances, such as land-cover changes,
land degradation and expansion of infrastructure. These are further exacerbated by more extreme
precipitation due to climate change, which is predicted to trigger more landslides and threaten
sustainable development in vulnerable regions. A high-risk score for this indicator is a result of highdependency of your industry on the absence or mitigation of this natural hazard in combination withhigh location risk scores.
Limited Wild Flora & Fauna Availability (1.3): this indicator refers to the unavailability of commerciallyharvested species. A high risk score for this indicator is a result of high dependency of your industry
on this resource in combination with a high location risk score.
Protected/Conserved Areas (6.1): this indicator is based on overlap of the assessment units withprotected areas (PA). Reputational risk will be influenced heavily by proximity to protected areas,
particularly as these two designations are used in corporate and financial safeguards. A high risk
score for this indicator is a result of high impact of your industry on PAs in combination with highlocation risk scores.
The assessment conducted in 2023 shows that Tsubaki Nakashima’s impact on Biodiversity is mainly
related to Pollution and land protection/conservation. In the coming years, all impacts will beanalyzed in detail and a strategy will be defined to mitigate all the highest biodiversity-related risks. In
any case, from this first assessment, it denotes that Tsubaki Nakashima’s sustainable development
strategy is already in line and able to mitigate the highest and most impactful risk indicator, which
is precisely the one concerning pollution (5.4).

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

181

COMMITMENT
TO PEOPLE

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

183

To create success and efficiency
we need to co-operate as One
Team. This requires that we
operate, train and protect ourpeople according to common
rules. Let’s start with the
PEOPLE VISION and MISSION
of Tsubaki Nakashima’s
people: what we want toachieve is to createa multi ethnical andmonoculturalorganization.

COMMITMENT
TO PEOPLE

VISIONCREATE A MULTI-ETHNICALAND TN MONOCULTURAL ORGANIZATIONMISSION

Foster differences to create added value and give new
and growth perspectives, balance the interests of the parties
by maximizing their mutual benefit, integrate and help people grow,creating a safe, fair work environment where everyone
is valued and valued for what they give.

In simple words thismeans that every-one istreated in an equal way,
has equal chances todevelopindependently
from their gender, race,
language, and cultural
background. We want toinstall the best blend of ourpeople’s talents to become
successful in adding value
to our stakeholders and toachieve profitable growth.

We set standard of behavior for team members and all
stakeholders while at work, helping all the employees to us comply
with applicable laws and regulations, guiding the decision-making
process, reinforcing the commitment to impeccable character.
As part of the Tsubaki Nakashima team, each employee takes
care of himself/herself and each other and Tsubaki Nakashimapromotes safety, health, and social responsibilities because people
matter – not just to the Company, but to fellow team members,
friends, families, and communities.
We value the power of Individual and Collective know-how: wegrow the business and in parallel improve the work environmentby building positive and enduring relationships.
We appreciate and favorite the contribution of every team memberin every location. It is the variety of talent, ideas, opinions andexperiences – what we call the “TN Collective know-how” – thatgives a broader understanding of the marketplace and the world
around. It is how we build high-performance teams and deliver
innovative solutions for customers. In everything the Group
does, diversity is a competitive advantage, and it drives creativity,
innovation, decision making and ability to serve our Customers.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP

INTEGRITYAND
ACCOUNTABILITYRESPECTAND
COMPASSIONPASSIONAND
COMMITMENTVALUESPROXIMITY

IND
CRED
NOTE

185

COMMITMENT
TO PEOPLE

To realize this Vision
Tsubaki Nakashima has
defined CORE VALUES with
4 main pillars.

LEADING
BY EXAMPLE

GEN
STR
Q
SOC

FUTUREORIENTED

DELIVER

GOV
SUST
SOC
SUPP
IND

TECHNICALCAPABILITIES

CRED
NOTE

These are anchors for our attitude and behaviours. As a Team we foster our DIVERSITY and by
sharing our diverse know-how we are able to reach a High-Performance culture with many
innovations. Being a Manufacturing company, we install a Safe and Healthy work environment,
which is our top priority. We are continuouslyy learning and improving by sharing the lessons wehave learned with all our plants.

187

COMMITMENT
TO PEOPLE

Generations

We recognize and value integrated
strategies for the development
and management of the needs ofthe different generations that work
together within the organization.

Gender

We value gender balance and theover-coming of any stereotype,discrimination or prejudice, inorder to create the best conditions
in which each person can express
themselves. TN is committed
to increasing the strengtheningof awareness initiatives at alllevels and promotes policies andactions aimed at promoting equal
opportunities, work-life balance, thesharing of family responsibilities andthe removal of potential obstacles,
including those related to sexual
orientation.

One of the principles in Tsubaki Nakashima is to respect
the Universal Declaration of Human Rights and to promote
HIGH LABOR STANDARDS, by applying our Code of Conduct.
As part of EVERY EMPLOYEE’S Onboarding procedure, theyreceive the Code of Business Ethic’s documents.

GEN
STR

We have plants and offices in Japan, United States, Italy,
Poland, Slovakia, Bosnia, China, Thailand, India, and Taiwan,
and in each of these countries, local employees take thelead in conducting activities.

Q

Our respect to our people is expressed by the diversity in
our company, with its plants over the globe and with 37
different nationalities.
We foster a gender balance, without obstacles, as well as
integration and inclusion of people with disabilities.
Every-one has talents and Tsubaki Nakashima wants tomake full use of everyone’s skills and competences.

SUST

In all our Teams and Plants, we meet different generations
and different cultures.

SOC

SOC
GOV

SUPP

Disability

We recognize equal opportunities for
all its people regardless of sensory,
cognitive and motor disabilities. In thiscontext, it is committed to implementing
concrete measures to promote theintegration and inclusion of people
with disabilities, making full use of
their talent and skills in the Company
and thus contributing to the removal ofcultural, sensory and physical barriers.

IND

Interculturalism

We are committed to promoting andsystematizing the mix of different cultures
within it through the promotion of anintercultural vision and open to multilevel discussion, based on organizationaland social cooperation.

CRED
NOTE

189

COMMITMENT

2.968

TO PEOPLEEMPLOYEESHAVE A PERMANENT CONTRACT

GEN

2023 - ACTUAL SITUATION
CLASSIFICATION

JAN

FEB

MAR

APR

MAY

JUN

JUL

AGO

SEP

OCT

NOV

DIC

Direct

1.649

1.688

1.672

1.667

1.678

1.686

1.664

1.659

1.673

1.655

1.654

1.651

Direct temporary

346

339

358

360

351

348

332

333

329

334

345

355

TOTAL DIRECT

1.995

2.027

2.030

2.027

2.029

2.034

1.996

1.992

2.002

1.989

1.999

2.006

Indirect Hourly

572

561

561

557

560

553

548

554

554

555

555

551

Indirect Salaried

428

431

414

420

423

422

434

435

442

446

439

442

Indirect Temporary Hourly

55

57

66

63

69

76

65

61

58

58

63

64

Indirect Temporary Salaried

28

30

28

28

27

31

38

39

41

40

41

39

1.083

1.079

1.069

1.068

1.079

1.082

1.085

1.089

1.095

1.099

1.098

1.096

SG&A Hourly

71

71

74

75

75

78

79

73

71

71

71

71

SG&A Salaried

251

251

248

250

250

254

250

260

259

260

264

253

SG&A Temporary

23

22

24

24

25

24

31

26

25

26

24

24

TOTAL SG&A

345

344

346

349

350

356

360

359

355

357

359

348

3.423

3.450

3.445

3.444

3.458

3.472

3.441

3.440

3.452

3.445

3.456

3.450

TOTAL INDIRECTTOTAL PLANT EMPLOYEESGRI 401

As of December 31, 2023, Tsubaki
Nakashima had 3450 employees,of which 2006 direct workers,
1096 indirect workers and salaried
workers, and 348 SG&A employees.

3.450

EMPLOYEESThe percentage of female staff varies fromgeographical area to geographical area, butalso depending on the type of product andthe mechanical processes carried out, andon the local culture, especially for what isconcerning India. Summarizing the data by
area, in Japan (in the 4 factories and the Osaka
headquarters) female staff amounts to 16%,

in Taiwan it rises to 23%, in Thailand it is close
to 44% and in China (3 factories) it stands at
21 %. Moving westwards, we find India with apresence of only 1%, while in Poland we reach
22.5%, in Slovakia 20%, in Italy (2 factories)
21%, in Bosnia Herzegovina 26%, in UK by 27%
and in Holland by 25%. In the 4 US factories,
the percentage amounts to 18%

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

191

COMMITMENT
TO PEOPLE

GRI 407
The most important of our management principles is respect for others, respect for the laws
and the territory where we operate. Freedom of association and discussion with company
representatives is fully protected and regulated by specific policies contained in our governancesystem. In all countries where local legislation provides for the stipulation of collective agreements(CLA, CBA), national and/or company, and employees wish to join the Union, respect for themand the willingness to discuss constructively on any topic that both inherent to the employment
relationship and the working conditions is total.
Specifically, in the countries where it is foreseen, we can say that 100% of our staff is protected.
Where workers’ representatives are present, information but also discussion and discussion
meetings are held regularly. However, where they are not present, management organizes
information sessions on strategies, trends, and results at least once a year.

In every Country where we operate, the RATIO of Standard entry level wage compared tominimum wage is at 100%; this not only guarantees fair treatment to those, especially young
people, approaching the world of work for the first time, but constitutes a solid basis forsalary improvements linked, in addition to the adjustments required by local laws or collective
agreements, to the improvement of competence and professionalism, and career opportunities
A second truly determining factor for Tsubaki Nakashima is the relationship with the communities
and the territory in which we operate.
In our hiring policies, we favor - with equal professionalism - local staff; but while for direct andindirect workers, as well as salaried workers, this is quite widespread, we also measure ourability to attract (or develop) local management or those who then move close to the factories,
progressively integrating into local communities. The table below demonstrates what has been said:

GRI 202

Proportion of management hired from the local communities

Our approach to compensation and beneﬁts, and related policies, ensures that employees arebeing paid fairly, and describes terms for workers’ compensation, allowances, beneﬁts, andbonuses (short-term and long-term incentive plans) at diﬀerent levels of our organization.
Compensation and beneﬁts can be subject to diﬀering Countries’ laws and regulations, but there isa deep and strict alignment with the Company’s culture, Corporate Governance and Management
Principles.
Tsubaki Nakashima is strongly committed, because we believe that only with a holistic approach
can we truly create a work environment where everyone can find their own motivation to achieve
results.
Our approach to compensation and benefits, and related policies, ensures that employees arebeing paid fairly, and describes terms for workers’ compensation, allowances, benefits, andbonuses (short-term and long-term incentive plans) at different levels of our organization.
Compensation and benefits can be subject to differing Countries’ laws and regulations, but there isa deep and strict alignment with the Company’s culture, Corporate Governance and Management
Principles.
Clear rules concerning compensation and benefits increase employee motivation. We believe thatthe promise of rewards and recognition for high-performing employees encourages people towork harder to meet both personal and company goals and objectives.
Effective and fair compensation also enriches your company culture, employees are more likely torecommend working for your organization and this further increase company loyalty and reduces
employee turnover.

Japan
TaiwanThailandChina - Taicang
China - Kunshan
China - Chonqing
India
PolandSlovakia
Italy
BosniaUnited Kingdom
The Netherlands
USA(within a radius of 50 km/30 miles)

94%
100%
50%
33%
13%
61%
60%
62%
90%
85%
85%
100%
100%
98%

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

193

GRI 401-3

For Tsubaki Nakashima, well-being is one of the keys for a healthy Company.
Our policies set additional expected standard of behavior for team members and all stakeholders
while at work, helping all the employees to us comply with applicable laws and regulations, guiding
the decision-making process, reinforcing the commitment to impeccable character. It includes
requirements driven by law, and requirements driven by Tsubaki Nakashima Code of Business
Ethics, philosophy, and culture and by Tsubaki Nakashima management statements.
As part of the Tsubaki Nakashima team, each employee takes care of himself/herself and eachother. Tsubaki Nakashima promotes safety, health, and social responsibilities because people
matter – not just to the Company, but to fellow team members, friends, families, and communities.
Tsubaki Nakashima shares a commitment to the idea that doing what is right extends into
the communities where the Group operates. As such, Tsubaki Nakashima cares for the work
environment and upholds human rights, regardless of local business customs. Specifically, when
we focus on people, it means that we respect and abide by all applicable employment laws in themarkets where we operate. If an employee has any questions regarding applicable employment
laws, he/she can consult with Tsubaki Nakashima Human Resources Team.
Our Labor Standards Policy is aligned with the principles established within the Universal
Declaration of Human Rights and in combination with TN (Tsubaki Nakashima) Managerial
Statement and Code of Business Ethics and reinforces the commitment to ensuring all internaland external stakeholders are treated with dignity and respect. As part of due diligence whenentering acquisitions, new operations, and other contractual arrangements, we seek to abide by
the requirements set out in this document to ensure any labor standards and human rights issues
are identified and assessed.
We believe that a good work environment means:
1 Physical environment: all places of work, all sites, and areas where work is carried out
2 Set of rules: the methods of performing the job’s functions
3 Corporate conditions: Company values, Company policies and protocols, Leadership style,
Employer’s programs for employees (e.g.: training, recreation, and engagement),
Job benefits (e.g.: salary, STI, LTI, health insurance, dental insurance, pension systems...),
Job conditions (terms of employment, flexibility), Social behaviors (G&O, PE, Teamwork,
openness, transparency, social and individual dynamics), Job satisfaction and Employee
opinions
As said, Tsubaki Nakashima operates in full compliance with employment laws and regulations in all
districts in which it operates. This includes laws governing wages, working hours, overtime, statutory
employee benefits and many others. The Company compensates employees competitively relative tothe industry and respective local labor markets.

COMMITMENT
TO PEOPLE

GEN
STR
Q
‘A better corporate citizen’ forms part of Tsubaki
Nakashima’s Management Principles and “Integrity,
Respect and Honest Communication, Courage”
inspire our Leaders, at all levels. As part of thiscommitment, Tsubaki Nakashima recognizes its
responsibility to ensure its people can enjoy a worklife balance and are provided with opportunities todevelop professionally.
The GRI standard 401 – 3 specifically mentions
elements of the benefit’s package are applying inmost of the Countries:
1 Life insurance: 10 plants
2 Health care (public and/or private),in every Country
3 Disability and invalidity
coverage, in every Country
4 Parental leave, in every Country except India(where the employees’ population is 99% men)
5 Retirement provisions, in every Country
6 Canteen, in 13 plants
7 Gifts, in every Country
8 Uniforms, in every plant excluding one

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

195

Tsubaki Nakashima recruits, develops, and promotes personnel based on merit and strives to maintaina work environment free from discrimination and harassment.

TRAINING

In Tsubaki Nakashima, for the DEVELOPMENT OF OUR PEOPLE, we have established and improved
an education and training system and we are continuously working to provide opportunities forall employees to acquire the knowledge, skills, and techniques necessary to perform their duties
accurately and promptly, both inside and outside the workplace. In Vision Zero, this is Zero lack ofKnowledge.

In the process of creating professionalism and skills, the most important part is that of defining
the expectations, contents and boundaries of a function, at any level; and then of the system oforganizational relationships. For this reason, in Tsubaki nakashima, we use two tools in particular:

GRI 404

We believe that the VALUE OF OUR MANAGERS should be the ratio between COMPETENCIES,
HUMILITY and ABILITY to operate. However, only our ATTITUDE can be the right multiplier to achieve
or not the success.

V = (C + h + A) x A
2

AND EDUCATION
1 Job Descriptions

GEN
STR

2 Definition of the minimum technical requirements and Gap Analysis

Immediately after the Gap analysis, a process of training and acquisition of skills begins which isexpressed and monitored through corporate tools (Performance Evaluation and the training platform
called Talent LMS) but above all factory tools (normally the so-called Skill Map)
But before getting into the specifics, one of the most important and subsequent phases of introducing
a new employee into the organization is the onboarding process.

Q
SOC
GOV

The minimum requirements of TN’s onboarding process are:1

Preparation for the employee’s first day: documentation, tour of work area, uniforms, equipment,
designated work area ready, introduction to managers, peers, subordinates, PPEs, etc.
2

Training program - including company overview, review of job description, goals and objectives,
pertinent work-instructions, on-the-job training program, key areas of interaction.

SUST
SOC

3

SUPP

4

IND

Goals Deployment - clear goals and objectives should be assigned to the employee in One Team (orif the process has been closed for the year), SMART goals should still be documented and deployed.
Follow-up sessions with the manager and HR should be formally conducted to document theemployees’ and manager’s feedback re. the onboarding processes. TN requires at least 2 follow up
sessions - one after the training plan is completed, and one after the employee completes 3 months
in the organization.

COMMITMENT

CRED
NOTE

TO PEOPLE

197

MAPPING AND

TRAINING
OF WORKERS

Plant managers and Management Team Members are requested to test the knowledge and technicalskills (specific to each machine / stage of the production/other specific processes) which are also
constantly mapped and monitored in order to ensure maximum effectiveness and quality of work
performed and therefore to verify and guarantee the compliance with the customer requirements.
The form, content and mapping of the analysis can differ from plant to plant, but the content must be thesame. The Department Supervisors analyze the skills of each employee, confirming the competencies
described in the “Skill Map” (or Training Plan) or planning the needed training activities in order todetermine the real status quo in terms of expertise, performance and reliability, and contains the date
in which the evaluation was done and the effectiveness of the training.

TSUBAKI NAKASHIMA ACADEMY (TN ACADEMY) aims to improve the value we create for the customer,
make our employees aware and prepared and offer growth opportunities, building their loyalty to thecompany.
The CHALLENGES OF TN ACADEMY we had to face were many: large number of participants, distributionof plants across different time zones, prerequisites of knowledge for participation in TN Academy,
thorough knowledge of company policies, ethics and vision, varying training and induction strategies
and procedures across the plants.
The SOLUTION we identified for the development of TN Academy, as well as a more agile managementof training at local level, and specifically the on-boarding processes, was a
A learning management system available online for all plants, with a
B common training platform – identical courses globally,

Training is provided in case of:
A new employees (On-boarding)B job change (job rotation, change of channel/department, etc.)
C new methodologies / machines / tools
D new work-instructions, procedures, policies, systems, customer requirements
E recovery/development because of the Performance Evaluation

TRAINING
PLATFORMS

TN Academy

Since 2023, TN Academy has been
migrated to a specific software,called TALENT LMS where, at thetime of drafting this Report, thestatus is the following:

STR

C training library available on the platform andD corporate trainings as well as plant-specific trainings all under one system

Q

TALENTLMS PLATFORM

SOC

COMMONREGISTRY

The Mapping starts from a formalized and described process for the key roles (those identified in
the Performance Evaluation) and for some well-defined indirect employees. The local HR Office is
responsible for the information collecting process that, combined with the analysis of training needs
and, if applicable, Competency Assessment, would form the Training and Development Plan.

TN ACADEMY(CORPORATE)

GEN

GOV

TRAINING PLANS(LOCAL)SUST
SOC

TALENT LIBRARY(PRE-DESIGNED COURSES)

SUPP

TRAINING TIMELEARNING STRUCTURES

1 MONTH
27 DAYS
14 HOURS

272 COURSES
32 GROUPS
22 BRANCHES
9 TESTS
3 SURVEYSCOURSE COMPLETION RATE

6.096 ASSIGNMENTS
3.506 COMPLETIONS
57.5% COMPLETED
0 NOT PASSED
190 IN PROGRESSPOTENTIAL SAVINGS

457 LESS COMMUTE HOURS
53.01 K$ TRAINING SAVINGS
327 BETTER SKILLED PEOPLE-7.39 Mg CO ENVIRONMENTAL IMPACT

IND
CRED
NOTE

2

199

DIVERSITY
AND EQUALOPPORTUNITYGRI 404-3:

Percentage of employees
receiving regular performanceand career development
reviews
All employees (100%) who
are included in the Goals
and Objectives processes
are consequently involved in
the Performance Evaluation
processes, at least once a year
and in a formal manner. As
regards the other employees,
considering that every year
there is a salary analysis
which evidently has as its
basis the evaluation of thetechnical-professional
skillsof the employees, we cansay that 100% of the people
are evaluated using objective
criteria.

GRI 408:
Child Labor

There are no employees
under 18 years of age
in any of the factories.

GRI 405:
Ratio of basic salary and remuneration of women to men:in our company, given the same job and function performed,
there are no salary differences between men and women,
as established by international and local regulations.
% of women in positions of responsibility/leadership NOTE: responsibility means for example: team leader, shift
leader, supervisor, head of department, manager, executive.
Even considering that our industrial sector and company
history, combined with the local culture that differs fromcountry to country, does not have a significant percentage
of female personnel in our factories, many women, and in
this case also very significant percentages, hold positions ofresponsibility at various levels.
The highest levels are reached in USA and China (20 - 30%)
but above all in Thailand where the percentage reaches 70%.
Women and non-Japanese members are represented in
our very diverse Committees
In the Management Committee (6 members), 3 are notJapanese of which one is a woman
In the Sustainability Committee (5 permanent members),
3 are not-Japanese of which two are women.
The Chair of our Risk Management Company is a notJapanese woman

GRI 406:
Non-discrimination

In 2023 we received one complaint concerning a
potential Incidents of discrimination.
Although Policy 3&4 relating to the “Non-retaliationand Whistle Blower process” allows each employee aprotected approach, in this case the former employee
preferred to expose herself only after having
terminated the working relationship. The Company
conducted a double internal investigation to ascertain
the truth, finding no discriminatory behavior. Despite
this, the former employee continued, and the casewill be heard in 2024 .

SMART
Purposes
Leverage a single toolfor identification of
performance relative
to assigned goals andrelevant competencies
for the prior year
Everyone has goals that
support overall Goals
Create, maintain aligned
global performance
evaluation process
Evaluate anddevelop one set ofcompetencies across
Tsubaki Nakashima
Simplicity

Goals and objective
process
Translate financial targets
in individual and specific tasks
Address the issues we havein every organization(e.g.: Quality, Forecast accuracy,
OEE, Productivity…)

Goals must be connectedto the strategy (MTP) and BP
Goals must be the resultof a discussion between employee and manager

SETTING TARGETS AND EXPECTATIONSEVALUATE PERFORMANCES AND COMPETENCIESThe criteria for evaluating employees who work a full day andemployees who work shorter hours are identical. This was done
to ensure a level playing field when it comes to advancement
and promotions. Employees are evaluated (Performance
Evaluation and Competency Assessment process) based on
their achievements with respect to goals (Goals and Objectives
Process) and based on their behaviors and competences, withrespect to the Tsubaki Nakashima Competencies.
Every target must align with the S.M.A.R.T. PHILOSOPHY
Each target (Goals and Objectives – G&O - Process) is discussed
between the first level manager and the employee and supervisedby the second level manager; the relevant HR Manager must
confirm that the targets meet the required requirements. A midterm review is carried out mid-year to confirm or modify thetargets.
The Performance Evaluation (PE), on the other hand, is a much
more complex process because it does not examine the results
set the previous year, but evaluates the individual’s skills,
identifies competences, strengths and weaknesses, provides anaction, experiential and training plan, to fill gaps and/or improve.
While the G&O process is started by the first level manager, theperformance evaluation begins with the employee himself which
is analyzed in a meeting with the manager and viewed by thesecond level manager.
The elements related to the assessment of competencies, are 4 andtake into consideration both behavioral competencies (Leading
by Example) and future orientation (Growth, Transformation),but also the technical competencies specific to the tasks androle performed (Technical Capabilities) and the ability to meet
expectations and achieve expected results (Delivery).
These are the cardinal points of our every action, which is why
they are represented graphically by a compass.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

201

GEN

EMPLOYEES’SATISFACTIONSURVEY 2023

STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

203

EMPLOYEES’SATISFACTIONSURVEY 2023

EthicsBrand

The success and growth Tsubaki Nakashima haveexperienced has been the direct result of our commitment
to maintaining a culture that places integrity and the fairtreatment of associates, customers, suppliers, competitors
and investors at the core of all our business dealings. This
continued emphasis on integrity, trust, participation andcredibility will allow us to build upon our reputation as aFirst-class Market Leader, creating value and future for theCompany and for all our employees.
The opinion of our employees, open, honest and sincere,
helps to improve working conditions, relationships,
performances, financial results. This is the reason why,
every other year, we conduct an internal Survey (which is
fully anonymous) to collect opinions, different points ofview and suggestions.
Once the results have been collected, they are analyzed byeach individual organization, discussed in specific meetings,
corrective and improvement actions defined which are
published and monitored.

GEN
Team

STR
Q

Job

SOC
SkillsGOV
SUST

Quality

SOC
Sustainability

SUPP

In 2023 we decided to improve the previous Surveys,
asking 35 questions, divided into 8 different categories –comparable with the past questionnaires.
The participation (70%) was in line with 2021 Survey andbetter that the 2019’s one (62%)

IND
Trust
CRED
% 0

Fully agree + Agree
Partially agree
Not agree

10

20

30

40

50

60

70

80

90

100

As can be seen from the graph, the percentage of consensus is very high: excluding those who partiallyagree with the proposed statements and considering only those who agree or totally agree, the minimum% is 65% in the case of the My Job category, to reach over 81% of the Brand Identity and Sustainability
categories. If we also take into account the “Partially Agree” category, the % reaches the minimumof 87% (My Job) up to more than 90% for all the other categories. Compared to previous years, we
improved in every area. It means that our employees are satisfied with the Company, appreciating theeffort we made to improve. We will continue to create actions and to listen the voice of our People

NOTE

205

TN AWARDS
2023

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

207

TN
AWARDSBEST RUN PLANT
Tsubaki Nakashima aims to recognize andreward excellence across the Organization,
inspiring us to be better, to think bigger andto continue to grow, profitably through the
TN Best Plant Award, which recognizes thecontinuous pursuit of excellence in every
aspect of the business including customers,
employees,
and environment.
For Tsubaki Nakashima is important torecognize those in our organization who
have really made a difference, and to
consider, in addition to the ability togenerate profit while keeping the promisesof the Business Plan, the 4 Cardinal Points of
our Performance Evaluation’s process.

WINNER 2023
TJO
GLOBAL CERAMIC
BUSINESSOKAYAMA, JAPANONE TEAM SPIRITETHICS AND COMPLIANCELEADING
BY EXAMPLEABILITY
TO ACHIEVE
THE TARGETS(OPERATINGPROFIT)
ALIGN ACTIONSWITH CORPORATEGOALSThe contribution to earnings of
178MJPY, which was generated
by overcharging BP.​Appropriate
supportforthe slump in TSR and the
response to the increasein TAG-C production, while
making facilities and materials
available.​

GROWTHORIENTATION (3NS)
CONTINUOUS
SUSTAINABILITY
DEVELOPMENT
APPROACH

GEN
STR
Q
SOC

FUTUREORIENTED

DELIVER

GOV
SUST
SOC

TECHNICALCAPABILITIESPROCESS FOCUS (PRODUCTIVITY, QUALITY,
ONTIME DELIVERY, INVENTORY MANAGEMENT)PROCESS IMPROVEMENT INNOVATION,
PROJECTS, KAIZEN)

SUPP
IND
CRED
NOTE

209

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP

TN
AWARDSBEST RUN PLANT 2023
TJO (Okayama, Japan)

IND
CRED
NOTE

211

BX
AWARDS
BE EXCEPTIONAL AWARDSBX (Be eXceptional) Awards is recognizing the results of peers andcolleagues in our group who have achieved excellence and serve as
inspiration and example for others. We want to inspire and celebrate
positive behavior, results, and successes.

OVERALL BX AWARDS RESULTS 2023
# of award
nominations
1st Quarter

2nd Quarter

Every employee of Tsubaki-Nakashima (except Regional or Divisional
Presidents, Global Function’s Heads and Management Committee
Members) can nominate candidates for the BX Award. No one
knows better than you as to whom amongst your peers needs
recognition for the extraordinary efforts and results, they deliver tothe company.

The most awarded employees in one
quarter – was China

4th Quarter

TOTAL
GEN

14 8 30

8

8 12

5

4 12

8

7 21

35 27 75

REGIONS: NUMBER OF AWARDS PER QUARTER
Americas

Europe

China

Japan

Asia

Q

GOV
4

1

0 1

3

3

0 0

2

3

3 3

4

1

2 4

1

0

0 0

SUST

REGIONS: NUMBER OF PLANTS PER QUARTER
Europe

China

Japan

Asia

WINNERS

75

STR

SOC

Americas

The most consistent - China, which
contributed nomination of at least
three employees each quarter

3rd Quarter# of awarded
employees

To createprofitable growth
the content needs
to Be eXceptional

Thriving as a Company and acting as a worldwide leader in ourbusiness segment can only be realized by showing exceptional results
and world-class excellence in all the things we do, independent fromthe role we fulfill in the Corporate – Region/Division - Plant or levelof responsibility we hold. Our goal is that every employee steps on
board and feels the spirit of being part of a winning team.

The biggest contributor was Japan (32candidates) which participated in eachquarter, as well as China# of plants

SOC
SUPP

1

AWARDEDEMPLOYEES

1

0 1

3

3

0 0

2

3

3 3

2

1

1 3

1

0

0 0

REGIONS: NUMBER OF EMPLOYEES PER QUARTER
Americas

Europe

China

Asia

Japan

IN 2023

IND
CRED
NOTE

4

1

0 2

3

3

0 0

14 3

3 9

8

5

9 10

1

0

0 0

213

INITIATIVES

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

215

INITIATIVESFOR COMMUNITIESTREAT THE TROOPS
The “Treat The Troops”
campaign was a huge success​thanks to the generosity of
our awesome employees​anda monetary donation fromthe company.

LIVE UNITEDGEN
STAFF THE BUS

THANKSGIVING
FOOD DRIVE
The drive collected >300 lbs
of food for those that need
it. We partnered with Calvary
Cares, an Erwin Food Pantry ofCalvary Baptist Church, for the
distribution. Don Pate, former
NN Maintenance Tech, runs
the program

USA

USA

Cumming[Georgia]

Erwin[Tennessee]

STR
Q
SOC
GOV

THE ANGEL TREE
FifteenUnicoiCountyChildren were represented on
our Tsubaki Nakashima’s tree,
and available for “adoption”:
an initiative to collect money
for the local community.

STAFF THE BUS
Donation of school supplies for teachers and students(cleaning wipes, notebooks, pens, pencils, tissue).

HOLIDAY TOY DRIVE
Donation of toys for local
children in need.

SUST
SOC
SUPP

USA

Sault Saint Marie[Michigan]

IND
CRED
NOTE

217

INITIATIVESFOR COMMUNITIESFOOD FOR ANIMALS
Collection of food and otheraccessories for homeless dogs
and cats under the care of thelocal association “TULIMY”in English “We cuddle” .

ITALY

GEN

Pinerolo

POLAND
Krasnik
SPONSORING
LOCAL INITIATIVES

EARTH DAYCampaign to promoteecology among employees
and residents. Distributed
free seedlings of trees,
shrubs and balcony plants.
Planted several trees andshrubs.

STR
Q
SOC
GOV
SUST

TSUBAKI NAKASHIMABIG WALKING IN PINEROLO
collecting money for the
local associations – 17.500
Euros distributed (3.200
participants),

FOOD FOR ANIMALS.

SLOVAKIA
KysuckeNove Mesto

SOC
SUPP
IND
CRED
NOTE

SHOPPING FOR CHRISTMASCOLLECTION FOR FAMILIES

219

INITIATIVESFOR EMPLOYEESEMPLOYEEEMPLOYEESCHRISTMAS PARTYEMPLOYEEOF THE MONTHEMPLOYEE APPRECIATIONCOOKOUTGEN

DECEMBER HOLIDAY LUNCH

USA

STR

Cumming[Georgia]

Q

USA

LUNCH BAG GIFT
for all employees

GOV

Sault Saint Marie[Michigan]
SHRINE CIRCUS

SUST
SOC

MANAGEMENT TEAM DINNER
ST. VALENTINE’S CANDIES
for all employees

SHARING CELEBRATIONS

SOC

SUPP
IND
CRED

USA

Erwin
[Tennessee]

NOTE

221

EMPLOYEEBIRTHDAY PARTY

INITIATIVESFOR EMPLOYEES
PARTY

GEN
STR

CHINA

Q

Chongqing
OFFICERELOCATION
CEREMONYCHINA

EMPLOYEE AWARD

SOC

OFFICECHRISTMAS DECOREMPLOYEE AWARD

GOV
SUST

Kunshan

SOC
SUPP
IND

LANTERN FESTIVAL

WOMEN’S DAY

WOMEN’S DAY

CRED

CHINA

Taicang

NOTE

223

INITIATIVESFOR EMPLOYEESFAREWELL PARTYNETHERLANDS
Veneendaal

PLAYNG BASEBALL TOGETHERCHRISTMAS
LUNCH

ITALY
Pinerolo

GEN
STR
Q
SOC
GOV

JAPAN
Katsuragi

EMPLOYEES’ REWARDS,
RECOGNITION
and encouragement to refer
qualified candidates

INDIA

TEAM
BUILDING FOR
MANAGERS ANDSHIFTLEADERSPOLAND

SUST

KrasnikSOC

SLOVAKIA
KysuckeNove Mesto

CHRISTMAS PARTY

SUPP
IND
CRED
NOTE

225

SAFETY& HEALTH

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

227

SAFETY& HEALTH
GRI 403:

Tsubaki Nakashima believes that providing and maintaining
a safe and healthy work environment and promoting
physical and mental well-being are the foundation of ahealthy company. Accordingly, understanding that safety
and health are the lifeblood of the company, we haveinstituted safety and health systems and activities at oursites around the world, so that our employees and partners
can enjoy working as part of a team in a healthy environment
and in the knowledge that they are safe and secure.
In our Vision Zero Approach, this is the ZERO ACCIDENTS,
ZERO OCCUPATIONAL ILLNESSES and, for some extend,
ZERO WASTES

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

229

SAFETY& HEALTH

Since that program came into effect,
we have enforced the GSS Manual andProcedures and manage our workplaces
with the idea that every workplace is
responsible for maintaining its own safety.
The Global Sustainability System has been
implemented in each of our factories, it isavailable on the Global Intranet platform.

The core component of this effort is the Tsubaki Nakashima
Global Sustainability System (GSS), according to the 3 mostimportant ISO Standards (ISO 14001, ISO 45001 and ISO
50001) of which one of them is ISO 45001 (OCCUPATIONALHEALTH AND SAFETY), established in 2018 and progressively
deployed in all the factories.

in its most updated version, together withmore than 40 training courses on the
GSS and on every single aspect of safety,
health and the environment, practicalexamples, and 43 Minimum TechnicalRequirements ( considered a level 3 ofthe system, where level 1 is the Manual,level 2 is the management procedures
and level 4 the forms and modules) which
establish the guidelines for complete andcorrect management of technical aspects,
ranging from the Machine Guarding toAtmospheric emissions, from Electrical
Safety to Wastewater management.

GSS (in its SH portion) is covering safety, health, disasterprevention, and facilities; this original Tsubaki Nakashima
program is based on an occupational safety and healthmanagement system that also conforms to International
Labour Organization (ILO) guidelines.
According to all the ISO standards we refer to here, themanagement flow is rigorously applied and begins (asdescribed in the figure) with the process map and thecontext analysis - for which we use the SWOT Analysis -, theidentification of the Risks and Opportunities which in turngenerates the Targets that are intended to be achieved andthe KPIs to measure their achievement, up to the final act
which is the Management Review.

Another extremely important tool is
the Safety Engineering Manual, basedon International Technical Standards,
a detailed guideline which helps theplants to guarantee safe machineries andworkplaces.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND

Process
Map
Materiality Analysis (next)
SWOT Analysis
Context
AnalysisRisks & Opportunities analysis

Targets
Objectives, Targets & Planning

Competences& Awareness
Rules& Reponsibilities

Risk Management
Human
side

Reports& Continuous
Improvement

NOTE

Communication
Measuring
KPIs

CRED

Management
Review

231

SAFETY& HEALTH

An extremely important part of the GSS is that relating torisk analysis: this is the reason why for years the Company
has asked each plant to use two tools created specifically toguarantee a complete, rigorous and serious risk assessment.
The Tools are:the Safety and Health Risk assessment toolkit and35

the Environmental aspects and impacts assessment

30

available on the Global Intranet.

25

Energy Assessments (based on ISO 50002) are managed
directly by the Central Sustainability Office, through specificworkshops and improvement and investment plans

20

Once the system has been implemented and fully
operational, both the system itself and the work
environments (therefore safety, health protection and theenvironment, as well as the rational use of resources, inparticular energy ones, must be kept under control.

5

+236%

+212%

311
+180%

C. A. SOLVED

255
+183%

STR

Audits count

IP count

Auditors count

Q
SOC
GOV

10

0
03/23

SUST
04/23

05/23

06/23

07/23

08/23

09/23

10/23

11/23

12/23

01/24

02/24

03/24

SOC

PERFORMANCE (30/03/2003 - 30/03/2024)
Average rating

100

Audit count

35

90

AVERAGE RATING

92%
+46%

Average rating

25

FINDINGSOVERVIEW (30/03/2003 - 30/03/2024)

80

30

70

25

60

20

50
40

15

30

10

20

5

10
0
03/23

04/23

05/23

06/23

07/23

08/23

09/23

10/23

11/23

12/23

01/24

02/24

SUPP
IND

Audit count37

ACTIVE AUDITORS

GEN

15

For this reason, a very sophisticated and electronic
inspection and audit system has been implemented,
available in 6 languages and available to all plants.

AUDITED IP

At the time of publication of this report, and looking at the period March 2023 - March 2024,
we can say that attention to internal auditing has grown exponentially

CRED
NOTE

0
03/24

233

SAFETY& HEALTH

ACCOUNTABILITYPYRAMIDGEN

MANAGEMENTCOMMITTEESTAFFSUPPORT

CEO
GM - PRESIDENTSTR

DIRECTRESPONSIBILITYQ
SOC

FINANCEHR& SUSTAINABILITY MAINTAINANCE

ENGINEERING

SALES
AND BUSINESSDEVELOPMENT

SUPPLYCHAIN

PLANT MANAGER

GOV
SUST

HEAD OFDEPARTMENT
SUPERVISORTEAM LEADER / SHIFT LEADER

WORKER

SOC
SUPP
IND
CRED
NOTE

235

SAFETY& HEALTH

INJURIES, ACCIDENTS AND

OCCUPATIONAL
ILLNESSES

TN believes that an effective system must be effective
regardless of the Certification paths; we are interested
in ensuring that safety is maximum, and that health andenvironmental protection are maximum, that each plantfocuses not only on the production and quality of products,
as well as on customer satisfaction, but on the rational useof resources. For this reason, each plant is free to choose
whether to be certified or not, considering certification as
an additional element to a solid and serious reality, not justsomething to show at the entrance.

INJURY FREQUENCY AND SEVERITY TABLES (2023)
AREA
PLANT
FREQUENCY
SEVERITY
14001

TJB

0,89

0

TJO

0

0

TJS

9,6

0

TJL

0,6

1,7

TJT

0

0

TCT

0

0

TCC

0,5

145

TCK

0,4

17

NUMBER OF ENVIRONMENTAL, SAFETY & ENERGY CERTIFICATIONS - ACHIEVED AND PLANNED

TSI

0,6

4,3

Japan
TaiwanThailand
China
India
PolandSlovakia
Italy
BosniaUnited Kingdom
Usa

TEN-R

0

0

TEP

0

0

TEU

0

0

TEI

0

0

TES

1,9

16,1

TEN-SMP

0

0

TEB

0,3

1,1

TAG

1,1

23

TAE-B

3,8

90

TAE-R

1,3

132

TAC

3,5

17

TAM

0

0

TSR

0,7

0

But the presence of certifications (ISO 14001, 45001 and
50001) is very massive, with 24 certifications achieved andscheduled45001

Taiwan
50001

China

IFICATIO
RT

CE

24

NS

4
1
1
3
2
1
3
3
2
0
4

Japan

EuropeAmericaThailandAs regards occupational diseases, they
were not found again in 2023, thanks
to the numerous initiatives aimed atcontaining noise, avoiding manual
handling of loads and eliminating
and/or reducing exposing people torisks of contact or inhalation withdangerous substances, also throughtheir elimination and replacementwith non-hazardous substances.
In 9 of the 21 plants, there were no
accidents at work; in 13, the number ofaccidents decreased compared to theprevious year, and in 15 we decreased
the Injury Severity.

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

237

INJURIES, ACCIDENTS AND

OCCUPATIONAL
ILLNESSES

Occupational health services are available in mostfactories and preliminary visits are always carriedout to guarantee suitability for carrying out the work
activity.

GEN

The participation, consultation and communicationof workers on health and safety at work is not only
guaranteed but encouraged, through workshops,
safety kaizens, meetings of local sustainability
committees and with questionnaires.

Q

The training of workers on health and safety at work
is always guaranteed with specific courses, and safety,
health and sustainability are always present in theannual training plans, with a focus on the promotionof workers’ health and well-being in general, evenoutside of work.
Tsubaki Nakashima analyzes all
occupational injuries and accidents,
identiﬁes causes, and makes plansfor preventing similar incidents.
Occupational accidents, including
the NEAR MISSED, are reported in
the form of PRELIMINARY ACCIDENTREPORT AND ROOT CAUSE ANALYSIS
which describes accident causes,
countermeasures, and actions thatall sites are to take to prevent similar
accidents in the future.
These reports are placed on One
Team Software and discussed with
employees.

We can say that 100% of our employees are therefore
covered by an occupational health and safety
management system, i.e. the GSS which we havealready mentioned several times
In the pictures in this page and top right: first-aid andfire fighting training in Okayama (Japan).

TRAINING

STR

SOC

During 2022, and thanks to the decrease in traveldifficulties following the pandemic, training
courses on safety and health were held - with
31 modules and different topics, audits andawareness acquisition in the field involving 75
managers and supervisors in Japan, 25 in Thailand
and over 150 in Europe. In 2023, there are plans
to extend the training to America and China, thus
covering the entire organization. The Talent LMS
e-learning platform will make it possible to use
all the training material (and course videos) bothfor on-boarding new employees and for refresh
training.
The company works every day with its employees
and collaborators to increase awareness of theimportance of behaving safely and respectfullyof one’s physical integrity, health and theenvironment in which one lives. The photographbelow expresses an extremely simple and effective
concept: every worker, entering the factory, cansee who the main actor of the safety guarantee
is, in a mirror...

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

239

SAFETY AND ENVIRONMENTAL

CLEAN THE ROAD

INITIATIVESHEAT SHIELDS
on the roof to protect ouremployees.

GEN
STR

JAPAN
Katsuragi

FIREFIGHTING TRAINING

JAPAN
Koriyama

NOISE MONITORING
FIREFIGHTING TRAININGQ
NEW SLUDGE PROJECT
Thanks to our continuous research,
Tsubaki Nakashima has developed
a new methodology for recyclingiron sludge, without heat or use of
briquetting machines. The processedsludge produced by this method is
directly used as a steel material at steel
companies, and the sludge has beenreborn as special steel products suchas steel wheels for cars.

JAPANOkayama

FIRST-AID TRAINING

SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

241

SAFETY AND ENVIRONMENTALINITIATIVES

GEN
STR
Q
NEW SLUDGE PROJECT
in 2023, we started a pilot project ofwater sludge granulation. This process
involves the recovery and reuse ofwater coolant while granulating thesludge resulting from the processing ofsteel balls and needles. The resulting
granulate is recycled in steelworks.
In 2023, we recovered 200,000 litersof coolant and granulated over 50% of
the produced water sludge.
At the end of 2023, we started
briquetting oil sludge. This process
consolidates our sludge and thenrecycles in steel mills.

SOC

POLAND
Krasnik

SLOVAKIATREE PLANTING

KysuckeNove Mesto

GOV
SUST
SOC
SUPP
IND
CRED
NOTE

243

SUPPLIERS
GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

245

SUPPLIERS& SUSTAINABILITYSUSTAINABILITYDATA

In order to assess and measure in detail the environmental
sustainability of suppliers Tsubaki Nakashima decided todevelop an ad hoc carbon footprint questionnaire. As thework of screening suppliers’ CO2 emissions is onerous
considering the large number of suppliers, as a first step
it was decided to engage the raw material suppliers as
they are also estimated to be responsible for most of the
supply chain-related CO2 emissions. The specific carbon
footprint of all raw material suppliers was then assessedin 2023 and they were then also engaged and informedof Tsubaki Nakashima’s sustainability goals.

During 2023 Tsubaki Nakashima developed additional
projects to engage suppliers in sustainable development
and in the green transition. We believe that all of our
suppliers must be committed to the same challenges as weare facing, in other words, those related to sustainability.
We also believe that it is powerful to share and support
each other in this journey. For that reason, in addition to
the sustainability self-assessment questionnaire, alreadysent in 2022 and useful to evaluate Social, Governance andEnvironmental impacts of our main suppliers, during 2023
Tsubaki Nakashima developed:

GEN
STR
Q
SOC

SUPPLIERS’ CODE OF CONDUCTGOVThrough the code of conduct developed compliance isrequired of all our suppliers regarding:

SUST

DRIVINGINTEGRITYIN BUSINESSDEALINGSHEALTHAND SAFETYANTITRUSTAND
COMPETITIONLAWSENVIRONMENTALRESPONSIBILITY

ANTICORRUPTION
AND ANTIBRIBERY LAWSDRIVINGINTEGRITY
THROUGH OURACTIONSGIFTSANDENTERTAINMENT

CONFLICTS
OF INTERESTSANCTIONSAND EXPORTCONTROLLAWS
PROTECTION OF
INFORMATIONANDINTELLECTUAL
PROPERTY

SOURCING
MATERIALS
FROM AREAS
OF CONFLICTDRIVINGINTEGRITYWITH GOOD
COMMUNICATION  DRIVINGINTEGRITYWITHIN OURWORKPLACEREPORTING
CONCERNS
AND NONRETALIATIONSOC

RESPECT
FOR LABORSTANDARDS AND
HUMAN RIGHTS

CONFLICTWITH OTHERREQUIREMENTS

DIVERSITYAND
INCLUSION
It is mandatory thatall suppliers adhere to
the developed code of
conduct, which is therefore
a powerful control tool forassessing the minimum
requirements in the ESG
area of our suppliers.

SUPP
IND
CRED
NOTE

247

INDEXGEN

STR

Q

GENERAL DISCLOSURE, MARKETS AND PRODUCTS,
ORGANIZATION, MANAGERIAL PRINCIPLESIntroduction and methodological notes
Precision for a changing and sustainable world - CEO MESSAGE
Vision, Mission, Management Principles
PolicyWho we are 
History
2023 new brand
21 plants
Organization
Organizational Chart 2024
Production
Products by sales
Equipment FactoryPrecision Steel Balls
Precision Ceramic Balls
Rollers
Medical Device Business
Metrology Products
Linear & Blowers
STRATEGY
Mid-Term Strategy 2021 - 2023
Results
Advantage Advisors 
QUALITY
QualityGlobal Quality KPIs
Main Global Quality activities
Global Laboratory
Events

SOC
5
7
13
17
19
21
25
37
39
41
43
45
47
49
53
55
65
69
71

73
77
79

81
85
87
91
93

GOV

SUST

SOCIALInternational events and perticipation in external activities 
Relations with schools 

95
101

GOVERNANCE
Governance
Risk Management System
Risk Management Committee

103
111
113

SUSTAINABILITYSUSTAINABILITYTN Atmosphere
Sustainability Committee
SDG tick notes
Global Sustainability System
Process Map Analysis
SWOT AnalysisStakeholders 
Sustainability strategy
SBTi
Near-term SBTNew Strategy
CDP
KPIs
Carbon footprint
Scope 3 emissions
Water
Recycled rate - wastes
Security ReportManagement of water discharge
BIODIVERSITY

115
117
123
125
127
131
135
141
143
147
149
151
153
159
161
163
165
167
169
171
173

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP
IND
CRED
NOTE

249

INDEX
SOC

SOCIALCOMMITTMENT TO PEOPLE
Principles, vision, mission
Core valuesInclusion and diversity, other policiesOur people - data
Inclusion and diversity, and other policies 
Our people - dataTraining and education
Training Platforms
Viversity and equal opportunities
Employee’s satisfacion Survey 2023
TN Awards 2023 
BX Awards
Initiatives
SAFETY & HEALTHGSS e Minimum Technical requirements
Accountability Pyramid
Certifications and Indexes
Training
Initiatives

183
185
187
189
191
191
193
197
199
201
203
207
213
215
227
231
235
237
239
241

GEN
STR
Q
SOC
GOV
SUST
SOC
SUPP

SUPPLIERS
SuppliersSuppliers and sustainability

245
247

IND

IND

INDEX

249

CRED

CRED

CREDITS

253

NOTE

NOTE

NOTES255

SUPP

251

CREDITSThe new logo and brand of the company, as well as thegraphic design and development of the contents in thispublication were thought and created by MARIO BOIS,
Italian eclectic artist, that expresses his creativity indifferent fields, being: graphic designer, actor in theatre
and film industry, journalist, director, author and poet. He
played the main character in "FIORI", movie nominatedamong the three finalists at Italian Golden Globe in
Rome in 2022. Since 2021 he’s glad to be called to workat new strategies and ideas for an efficient, creative andimpressive corporate identity and communication for
Tsubaki Nakashima.

GEN

In 2023 the ESG Report 2022 was awarded the IDA(International Design Awards) with bronze award for the
category “annual reports”.

SOC

STR
Q

GOV
SUST
SOC
SUPP
The pictures collected in this edition have been taken by
FRANCO DUTTO, CHRO of Tsubaki Nakashima. You haveappreciated them in most of the pages of this report.
“If it is true that photography is a means of expressionthat allows us to convey emotions, tell stories and shareexperiences, and is a way to communicate without words,
the images in this Report represent the eyes with which I
looked at the world I visited , the people I met, the places
where we are present. And they are the it’s the humantreasure that I want to share, leaving Tsubaki Nakashima
after many successful years.”

IND
CRED
NOTE

253