INTEGRATED REPORT 2023
Arisawa Mfg. Co., Ltd.

ARISAWA INTEGRATED REPORT

Corporate Philosophy
Arisawa as business came into being in 1909 with the production of Battenberg lace,where it cultivated expertise that would later attain a new height with the epochal introduction of glass ﬁber.
What followed was a string of novel materials from Arisawa featuring unheard-of properties,
to which the company went on to apply innovative technologies.
This process enabled Arisawa to build up coherent production systems and a unique technical edge integrating the"weaving, coating, and molding" elements while consistently fulﬁlling users' needs.
Arisawa's current offerings include, among others, electronic materials for use in PCs,
mobile phones, etc., industrial application structural materials(e.g. honeycomb sandwich panels for use in aircraft interiors), electrical insulating materials, and display materials,
all of which contribute to the development of various industries.
We at Arisawa Mfg. Co., Ltd. have our mind set on opening a vista for the future as we remain proactive
in our efforts to develop innovative materials.

CIC"Create, Innovate, and Challenge"

Better today than yesterday
better tomorrow than today~ Take a step forward to create a better future ~1About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

About Arisawa
Corporate Philosophy ……………………………… 1
Policies ………………………………………………… 3
Global Business Operations ……………………… 4
Message from Representative Director ……… 5

Value Creation
History of Value Creation ………………………… 11
Value Creation Process …………………………… 13
Management Capital for Value Creation ……… 15
Sources of Value Creation (Business Model)… 17
New Initiatives for Value Creation ……………… 18

Management Policy
Sustainability Management ……………………… 19
Mid-Term Management Plan …………………… 21
Businesses / Overview of Each Segment ……… 23
ｰ Electronic Material Segment …………………… 25
ｰ Industrial Structural Material andElectrical Insulating Material Segment ……… 27
ｰ Display Material Segment ……………………… 29
Editorial policy
Since the ﬁrst issuance of an environmental report in
FY2005, the Arisawa Group has provided information
about its social contribution activities through businessin its mid-term management plan and initiatives on
climate change (disclosure based on the framework of
TCFD recommendations).
This integrated report is intended to provide newopportunities for dialogue by presenting stakeholders,
including shareholders and investors, with the company's
initiatives toward the improvement of its corporate value
over the medium to long term.

Financial Strategy …………………………………… 31

Sustainability
Environmental Management ……………… 33
E

Promotion of Circular Economy ………… 37
Human Resource Management ………… 39

Scope of the report
This report covers Arisawa Mfg. Co., Ltd. and its
domestic and overseas group companies and afﬁliates. In
this report, "Arisawa", "we", "us", or "our" means Arisawa
Mfg. Co., Ltd., and "our group" means the entire Arisawa
Group.

Coverage period of the report
The coverage period is from April 1, 2022, to March 31,
2023, but note that some descriptions may include
activities before and after this period when necessary.

Response to Climate Change …………… 35

S

Occupational Safety and Health ………… 41
Supply Chain Management ……………… 42
Quality Improvement Initiatives ………… 43
Corporate Governance …………………… 45

G

Board of Directors ………………………… 47
List of Ofﬁcers ……………………………… 51

Other reference information

Company Overview

For technical terms, such as our group's products
mentioned in this report, see our website (Technology/Products > Glossary).

Company Proﬁle …………………………………… 53
Stock Overview ……………………………………… 54

2

ARISAWA INTEGRATED REPORT

About Arisawa
Policies

Management Policy
On the basis of the motto "Create, Innovate and Challenge", we pledge to:(I) create new values and enhance customer satisfaction.
(II) discover customer demands and create new businesses with our creativetechnologies.
(III) strengthen corporate structure by improving our quality and productivity.
(IV)contribute to solving the social and environmental issues, and realize thesustainable growth.

Our Action Guideline(I) We compare what we are today with what we were yesterday, rather thancomparing ourselves with others.
(II) We do a job to be proud of in the future as a professional manufacturer witha strong will and a humble heart.
(III) We take a step forward to challenge, instead of looking for an excuse ofcannot to do.
(IV)We give the highest priority to safety, and fulﬁll our own roles and responsibilities for zero accidents

3

ESG Policy

Environmental Policy

In all aspects of our business activities, we actively addresses a variety of issues related toenvironment, society and governance and aims toachieve sustainable growth.

We strive to reduce environmental loads, promote
environmental conservation, and help solve socialand environmental issues in our whole businessactivities, from development and design to manufacturing of electronic materials, industrial structural materials, electrical insulating materials, anddisplay materials, to achieve sustainable growth.

CSR Procurement Policy

Quality Policy

We procure materials in compliance with laws andinternal policies and based on the mutual understanding and trust with our suppliers.

We pledge to supply the high quality product thatmeets the reliability and needs of the customer bystanding in the customer's viewpoint.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Global Business Operations (As of March 31, 2023)
Sales

Number of employees
Europe & U.S.
144

Europe & U.S.
¥5.3 billion

10％

13％

China & Taiwan¥8.6 billion

20％

China & Taiwan
345

FY ended
March 2023

¥42.7
billion24％

Arisawa¥24.4 billion

Arisawa
599

FY ended
March 2023

41％

1,458

57％

Domestic subsidiaries¥4.4 billion

Domestic subsidiaries
370

10％

25％

Global Ofﬁces

Protec Arisawa Europe, S.A.
Protec Arisawa America, Inc.

TopFlex Corporation
ThinFlex Corporation

Arisawa Mfg. Co., Ltd.
(Joetsu Head Ofﬁce and Factories)
Arisawa Fiber Glass Co., Ltd.
Arisawa Sogyo Co., Ltd.
ColorLink Japan, Ltd.
Arisawa Mfg. Co., Ltd.(Tokyo Head Ofﬁce)
Arisawa Jushi Kogyo Co., Ltd.

Arisawa Mfg. Co., Ltd.(Kansai Sales Ofﬁce)
Satosen Co., Ltd.

4

ARISAWA INTEGRATED REPORT

About Arisawa
Message from Representative Director

Being a company that keeps evolving by passing down
the knowledge and technologies cultivated since its
foundation to the next generations
Representative Director and CEO

Yuta Arisawa

Background of Issuing
the Integrated Report

Impetus for the Growth of Arisawa

Arisawa as business came into being in 1909 with theSince our foundation, we have developed and offeredproduction of Battenberg lace, where it cultivatedproducts and services through trial and error while

expertise that would later attain a new height with thelistening to the opinions of customers to exceed theirepochal introduction of glass ﬁber. Since then, we

expectations even a little bit. Our mission is tohave produced new products through research andpersistently surprise and delight customers by goingdevelopment and technological innovation to materi-

above expectations.

alize our dreams while living up to customers' expectations.

We repeatedly attempt to integrate our knowledge
and technologies cultivated since our foundation to

Our core technologies are "weaving, coating, andprovide them as services. Most of these knowledge andmolding", and we thoroughly pursue the correspond-

technologies are something like tacit knowledge, suching

processing

as experiences and instincts, which is hard to put into

technologies. We have manufacturing sites in Taiwan,

manufacturing,

formulation,

andwords. However, we itemized and organized all of them

China, European countries, and the U.S. and use

and prepared manuals including speciﬁed manufactur-

various technologies at them to meet worldwide

ing conditions. By sharing this stored explicit knowl-customers' needs.

edge among related departments, we have improved

This is our ﬁrst attempt to issue a periodic integrated report. The ﬁrst issue introduces the sources of

our work environment for all members to appropriately
carry out their tasks.

our corporate culture and our long-term goals andManufacturing and development require patience.

also provides our stakeholders with information about

To address customers' demands, we have conducted

our group's initiatives for the sustainable growth ofsteady experiments. Developing products that fulﬁllsocial contribution and corporate value.

their expectations also requires us to search forvarious possibilities, which may result in unexpectedby-products.These can be called induced accidents.
The reason why we have grown and developed for morethan 100 years must be that we have placed importance on "tacit knowledge" and "induced accidents".

5About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

6

ARISAWA INTEGRATED REPORT

About Arisawa
Message from Representative Director
A corporate culture that allows
employees to keep developing
unique technologies

stagnates and begins to lose ground once it is satisﬁed

For 10 years since I became the Representative Director

and encouraging each other based on the spirit of "Betterand CEO of Arisawa, I have managed the company with afocus on "succession and evolution". To keep us surviving
and growing, I always ask all of our employees for somewith the current situation and stops taking steps forward.
Each employee's step is small but when put together will bea huge driving force for the entire company.
If we move forward with all employees working hard
today than yesterday better tomorrow than today", we willkeep evolving towards further prosperity over the next
100 years.

favors.
First, I want them to keep trying new things in theirwork without being afraid of failure. If they fail, theyshould learn from the failure by investigating the cause orreason and do better next time.
Second, they must never stop taking steps forward.
We have a corporate value of "Better today than yesterday
better tomorrow than today". It means that employees
should not compare themselves to others but think thatthey can do better than yesterday, one day at a time. That
is why it is important to repeat trial and error and learn
from failure. Maintaining this corporate culture that allows
for failure can lead us to achieve CIC ("Create, Innovate,
and Challenge")̶the basic motto of our management
policy.
As a river stagnates when it stops ﬂowing, a company

7

Reaching out for new demands
Regardingthesocialenvironment

surroundingus,

economic activities have been resumed by easing restrictions on people's activities during the spread of COVID-19
infections. However, there is still an uncertain outlook forthe economy due to the continued high prices of energy
and raw materials amid the prolonged Ukrainian crisis andthe weaker yen, global inﬂation, and demand decline in the
Chinese market.
Especially, electronic materials, one of our group's
main business ﬁelds, have been affected by the downturnin demand for PCs and smartphones since the latter half of
FY2022 partly due to the rebound of stay-at-homeAbout Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

demand. Meanwhile, the slump of the aircraft industry due

markets where our technologies can be leveraged forto the COVID-19 crisis hit the bottom, and the demand forfurther expansion.

honeycomb sandwich panels for use in aircraft interiors is
beginning to pick up again.

By regarding environmental issues as important, we
will also drive initiatives for the renewable and new energy

In the electronic material ﬁeld, smartphones are

ﬁelds and increase the percentage of products thatgetting wider and thinner and gaining improvements suchcontribute to saving energy and resources. To achieve ouras a longer battery life. Other features are also expectedannounced goals (Scope 1 and 2) of carbon neutrality by

to be available in the future, such as faster communica-

2030, we promote the procurement of green energy,

tions, IoT devices, and touch-free operation devices. To

energy-saving equipment, and the use of solar energy

address such demand, we are working hard to be the ﬁrst

generation (onsite PPA).

in the industry to develop high-grade products.

The update and replacement timings of existing

Looking at the global market trend in the medium tosystems are business opportunities for us. To quickly

long term, we assume that the demand is highly likely torespond to new demand from customers and predictrise. We will increase our presence not only in the informa-potentially increasing demand, we need to improve exist-

tion device ﬁeld, which has a short life cycle of producting products and always sow the seeds of new products. I

models, but also in the next-generation mobility ﬁeld,

tell the research and development team members to spend

including electric vehicles, for long-term and stable

15 percent of their working hours studying what they like.

growth. Regarding an entry to the next-generation mobili-Free study stimulates employees' intellectual curiosity,

ty ﬁeld, the same process of using obtained information

hopefully leading to innovation. For example, if there isfor material development is applicable, so I believe that we

one good idea out of 50 ideas submitted, I think it iscan leverage our experience and knowledge. However,enough.

since this ﬁeld requires more endurance and reliability

Another means of company growth is M&A. M&A

than the information device ﬁeld, we will consider theallows us to offer new lineups of technologies andentry after strengthening collaboration with businessproducts for continued growth as a group. Whether topartners and receiving advice from them.

implement M&A or not relies the most on the existence of

For aircraft materials, we are developing ones to be"a synergistic effect with the strengths of our business".

certiﬁed as next-generation aircraft materials. As well as

The important thing is not to bring us short-term proﬁts

developing and offering lighter and stronger materials

but to improve our corporate value in the long term. Newly

while in compliance with strict safety standards, we will

joined group companies ThinFlex and Protec have steadilyurge not only large but also small and medium-sizedshown a synergistic effect and supported the growth ofaircraft manufacturers to adopt the materials.

our group, which I am conﬁdent are examples of M&A

Even in the life science ﬁeld, which continues strong

success.

growth, such as water treatment, we will tap into new8ARISAWA INTEGRATED REPORT

About Arisawa
Message from Representative Director
Growing for the next 100 years
With support from various stakeholders, including clients,
suppliers, shareholders, and local community members, aswell as the efforts made by our predecessors, we havedeveloped and supplied materials required in the times,
contributing to society. Consequently, we have grown insize to a company listed on the Prime Market with over
1,400 employees in total as a group. This is due entirely tothe cooperation of many people involved in our businesses. Let me sincerely thank all of them again.
The environment surrounding us was not entirely
smooth sailing. Our executives and employees are serious,
sincere, honest, patient, and hungry for challenges. I
would say that a strong relationship of mutual trust
between executives, employees, and stakeholders helped
us overcome various crises to survive in the industry. We
are a technology-based company with long-cultivatedunique technologies of "weaving, coating, and molding" ascore competencies. In the competitor value chain ofelectronic and industrial structural materials, nothing cantake the place of the current relationship, where we are
ﬁrst provided with demand and proposal of new materials
for prototyping from clients and for development frommaterial manufacturing partners. To maintain this healthybusiness cycle, it is crucial for us to keep investing inresearch and development and human resources even in
tough times.
For investment in human resources, which is important as well as research and development, we provide
frameworks and opportunities that encourage employees
to be more ambitious. A key factor could be increased
engagement, such as creating a better work environment
where the curiosity of employees is respected to maximize
their capabilities and stimulating internal communication.
We will invigorate the entire workplace by actively hiringexperienced personnel and having women play more
active roles while cherishing traditionally good things.
We take pride in selling not only "products" but also"reliability". Selling "reliability" means that we deliver"relief" along with "products" to customers. "Relief" meansthat we ﬁrst continuously provide the promised performance (speciﬁcations) and then stably supply the quantity needed by customers whenever needed. Keeping doing
such simple and basic things faithfully makes "products"
and "reliability" inseparable, resulting in the safe delivery
9of "relief". I believe this is what the Arisawa brand offers.
Together with our employees, I would like to secure thetrust of customers, continuously receive orders fromthem, and keep offering high-quality products to them.
Last of all, let me speak about our governance. To
strengthen the management monitoring, we have appointed a new Board of Directors with a majority of independent
outside directors. Five of six Nomination and Compensation Advisory Committee members are also independent
outside directors, and even the chairperson is an independent outside director. We chose persons who can complement the skills our executives do not have according to the
published skill matrix. The skill matrix revealed our need toenhance the knowledge of ﬁnancial markets, so we spent
three years to ﬁnd a new director who is familiar withﬁnance. She started serving as a director this ﬁscal year
and has already provided us with valuable opinions. The
enhanced monitoring allows management with a sense ofserious purpose.
I am sure that we will have a bumpy road ahead. Our
products must become the foundation of advanced
technology, contributing to creating a better future. To
keep our business activities growing permanently over the
next 100 years as a public entity of society, we will makefurther efforts to aim higher.

About rebranding
We renewed our corporate logo on April 1, 2023. (SeeRebranding on page 16.)(1) "What should not be changed" and"what should be changed" There was

There was an opportunity to think about what is themost characteristic of the Arisawa brand. It may beAbout Arisawa

Value Creation

Management Policy"seriousness" or "honesty," but everyone must have a
different impression. If I am asked to describe Arisawa in a

Sustainability

Company Overview(2) Implications of the word "Pieces"

I asked myself what our predecessors have made. My

word, I would not be able to ﬁnd the right one for a while.

answer is that they have created value for customers. The

To contemplate our brand again internally, we launched aengineering division creates new value, the manufacturing

rebranding project, by taking advantage of the senses anddivision materializes that value, and the technical divisionintellectual abilities of young employees, who will playprovides the value to customers. This is what we haveactive roles in the company in the years to come.

persistently done for more than 100 years. I had theThis year marked the 114th anniversary of Arisawa.

project team members come up with a new slogan thatIn these long years of history, we posted an unconsolidat-

expresses the mission of passing this tradition down to theed operating loss for the ﬁfth straight ﬁscal year. Howev-

next generations. It is "Where Future Pieces Arise".

er, we overcame such a crisis situation and have conduct-

This slogan represents that unique pieces (materials

ed corporate activities with vitality. This could be attribut-

and parts) are born and raised in this company and shaped

ed to our corporate culture persistently established by our

into high-tech products that support a better future. It

predecessors, unique technologies, and high-quality

also implies huge responsibilities attached to us as the

products, all of which are built on our underlying motto

front-runner of product-making and our commitment tocalled CIC ("Create, Innovate, and Challenge") - some-the continued advancement of technology.

thing like our DNA. This DNA, which has supported ourThis logo renewal is only the beginning of ourhistory of more than 100 years, must be passed down torebranding. The logo is a tool and just one piece ofthe next generations.

rebranding us. It is not easy to have our new brand pene-

Society is ever-changing, and we need to change,

trate the market. The important thing is that we help makeaccordingly. To rebrand the company, we ﬁgured out

people's lives better through our daily work. The pieces we"what should not be changed" and "what should bemade are built into various end products, such as aircraftchanged". In the end, we decided to change brand expres-interiors, smartphones, and tablets. Our products aresion while maintaining our long-inherited CIC spirit. The

rarely recognized by users. Therefore, another purpose ofrenewal of our corporate logo is just one of the approach-

our rebranding project is to let our employees take pride in

es for rebranding, hopefully leading to the establishment

doing behind-the-scenes jobs as "unsung heroes".

and widespread of our brand image sooner or later.

10

ARISAWA INTEGRATED REPORT

Value Creation
History of Value Creation
Arisawa has contributed to society for 114 years by developing its unique technologies of "weaving, coating, and molding".
1900●1909 Tomitaro Arisawa establishes company making Battenberg lace.
●1919 Renames Company to Nihon Braid Co. Ltd.

Starting "weaving" technology
The history of Arisawa began in 1909 with the production and sales ofBattenberg lace. As it is said that more than 7,000 people of about 27,000
people of Takada City (presently part of Joetsu City) were engaged inBattenberg lace making, this company's foundation coincided with thetrend.
In the same year, the company was renamed Nihon Braid Co. Ltd.,
which inspired the company's original logo "NB". In 1910, the company
established Toyo Braid, a joint-stock company that domestically produces
braids (fabric tapes)−the basic material for Battenberg lace−which were
imported before then, leading to the invention of "weaving" technology.
The company had 800 weaving machines and 600 artisans at its peak andwas renamed again to Nihon Braid in 1919.
Affected by the aftermath of the Great Depression, Nihon Braid wasforced to be reorganized due partially to the rise of low-priced Chinese
Battenberg lace. When Nihon Braid was reorganized to become a privately
managed ﬁrm, Arisawa Seisakusho, in 1930, Japanese industries were at
the bottom.However, as the encouragement policy set by the Japanese
government for such domestic products as electrical insulating tapes
provided a supportive backdrop, the company gained top-rating clients,
such as Toshiba and Mitsubishi, and established the foundation of what
Arisawa is today. There was also a time when the company was boosted by
fastener tapes --other narrow woven fabrics.
During World War II, the company shifted its main production toelectrical insulating tapes and fabrics for military use to get through thetough times.

Arisawa at the time of its foundation

Battenberg laceFirst foundation

First foundation●1930

Nihon Braid Co. Ltd. is reorganized to
become Arisawa Seisakusho, a privately
managed ﬁrm owned by Tomitaro Arisawa.

●1931 Launches production ofelectrical insulating tape.

●1934 Launches mass

production of fastener tape.

Weaving

Second foundation
From "weaving" to "coating" and then to "molding"In 1949, Arisawa Seisakusho became Arisawa Mfg. Co., Ltd. andintroduced the glass cloth manufacturing equipment, which became a major
turning point for the company. After entering the glass tape fabric market,
the company started testing the production of glass cloths for laminates in1951. This helped the company develop its "weaving" technology.
The company launched the testing of "coating" technology around thesame time and started the mass production of glass cloth products withsilicone rubber applied in 1958, which it can be said was the beginning of its
full-scale coating business.
In 1961, immediately after being listed on the 2nd Section of theTokyo Stock Exchange, the company started producing not only impregnated paper for decorative boards and ski sheets but also products made by
applying its "molding" technology such as ﬁlament winding and pultrusion.
The company also launched the prototyping of reﬂective aluminum screensat the request of Sony and started their shipments in 1972. They became
the company's primary business, which deﬁned one of its key moments.
By not only improving the basic technologies of "weaving, coating, andmolding" but also integrating them and even introducing another technologyof "combining", the company has produced products that meet the requirements of the times. The major products include polarizing ﬁlms, materials for
ﬂexible printed circuit boards, honeycomb sandwich panels for aircraft,
Fresnel lenses, and 3D ﬁlters.

Glass cloth warping factory

Transition of sales

Honeycomb sandwich panels(In 100 millions of yen)

700
600
500

President Tadaichi Arisawa
reorganizes to Arisawa Mfg. Co., Ltd.

Eiichi Arisawa
becomes President

400
Shuichi Minowa
becomes President

300
200
100
0

11

1950

1960

1970

1980

About Arisawa

Value Creation

Management Policy

Sustainability

1950

Company Overview

2000●1949 Company becomes Arisawa Mfg. Co., Ltd. Tadaichi Arisawa becomes President.

●2002 Arisawa Mfg. Co., Ltd. stock is listed in the 1st Section of the Tokyo Stock Exchange.

●1961 Stock is listed on the 2nd Section of the Tokyo Stock Exchange.

●1946 Expands electrical insulating tape production facilities.
●1949 Begins technological development activities for the production of glass cloths.
●1950 Launches production of glass and synthetic ﬁber cloths.
●1951 Launches test weaving of glass cloths for laminates.

Second foundation●1967 Builds glass cloth processing factory.

●1954 Sets up resin processing department; and begins research of silicone rubber processing technology.
●2008 Opens new facilities for 3D ﬁlter X-pol.
●1958 Expands production facilities for glass cloth silicone rubber and glass tubes.
●1959 Launches mass production of prepregs and varnished clothes.
●2020●1981 Launches production of materials for ﬂexible printed circuit boards.
Launches mass
●1965 Launches mass production of impregnated paper for decorative boards.
production of titanium
foil with ultra-thin●1975 Launches production of mica tape for heat-resistant/ﬁreproof electric wires.
lubricant applied.
●1980 Launches production of polarizing ﬁlms.

Coating●1953 Launches research activities for the production of skis using reinforced plastic.
●1957 Announce trial production of glass ﬁber skis.
●1984 Launches mass production of honeycomb sandwich panels for aircraft.
●1985 Establishes screen manufacturing factory for Fresnel lens production.
●1969 Launches ﬁlament winding operations.
●1998 Establishes new facilities for the production of optical lens sheets.
●1971 Launches production of ski sheets.
●1972 Launches production of pultrusion moldings.

Launches mass production of reﬂective aluminum screens.

Molding●1978 Launches research activities for carbon ﬁber composite materials.

History of the major afﬁliates
ThinFlex / TopFlex 2009
Satosen 2017
Arisawa Fiber Glass 2000
Protec Arisawa Europe / Protec Arisawa America 2010
Arisawa Sogyo 1974
Arisawa Jushi Kogyo 1966
Polatechno 1991

2019
ColorLink Japan 2007

Yuta Arisawa
becomes President
Sanji Arisawa
becomes President

1990

2000

2010

2020

12

ARISAWA INTEGRATED REPORT

Value Creation
External environments (social issues)

Value Creation Process
Arisawa started its business with the making of one braid about 100
years ago. We at Arisawa have supported various kinds ofproduct-making by developing products using glass ﬁber and othernew materials and innovating technologies in response to the needsof the times. With responsibility and pride as a company involved in
the initial stage of product-making, we will move forward moresmoothly and actively to change product-making around the world
for the better in the next 100 years.
Our group's current major product segments include electronicmaterials, industrial structural materials, electrical insulating
materials, and display materials. Through value-creation activities tosupport these segments, we offer products and services that help
people have richer lives. We are committed to creating social andeconomic values by tackling the four issues "contribution to a
decarbonized society", "development of diversiﬁed human resources
and improvement in job satisfaction", "promotion of circular
economy", and "enhancement of governance" through activities to bea strong company that can achieve sustainable growth.

-Climate change -Resource depletion -Ecosystem collapse-Tightening of regulations -Diversiﬁcation of values and lifestyles-Aging society -Divisions of the supply chain-Exposure of human rights issues -Mobility of workplaces-Progress of innovation -Exposure of geopolitics and cyber risks❺Materiality / ESG Policy
P.19〜20

Promotion of
circular economy
Contribution to a
decarbonized society

Enhancementof governance
Development of diversiﬁed
human resources andimprovement in job satisfaction❶Management Capital（Input）
Manufactured
capital

P.15〜16

Manufacturing and processing
facilities covering from productionof many models in small quantities
to mass production
A global production system

データ待ち

Financial capital"Create, Innovate,

Natural capital
Energy (crude oil equivalent)[FY2022: 15,432 kL]
Raw materials such as chemicalmaterials and organic solvents(amount of purchased materials)[FY2022: 9,009 t]

CI

Better today than yesterday

A robust balance sheet

Intellectual capital

Stable cash ﬂow
generation capability

Material processing technologies
with the basics of"weaving, coating, and molding"A relationship of trustwith customers based on records

An in-house control systemand control know-how
Tacit knowledge transferred
across departments
and products

Social & relationshipcapitalHuman capital
Consolidated numberof employees 1,458
A persistent corporate
culture with achallenging spirit

A network with about
1,000 suppliers with abroader range of service❷ Competitive advantages
and business model evolution
A mastered processing
production that integrates"weaving, coating,and molding"■Independence from therelated manufacturer
groupsA centralized system
to allow quick response■Development andmanufacturing functions
centralized for quick
integration

Flexible
response toenvironmental ■Integrated production of"weaving, coating,change■An integrated processing
and molding" withproduction of "weaving,
fast feedback to eachcoating, and molding" toprocess
enable compound development■Quick decisionmaking
and manufacturing
by top executive

Existing businesses utilizing＋
competitive advantages

Innovative new businesses
based on the CIC spirit

Evolution of the mid-term model● Evolution into a proposal-based business through active discovery of needs● Evolution into an industry front-runner leading toward a decarbonized society● Evolution into "weaving, coating, and molding" + "combining"● Evolution into a global manufacturer from Joetsu to the world13

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Suppliers❹ Value Provision（Outcome）

Stable and continuous transactions
Added value generated only throughcollaboration with us

Customers

Shareholders
and investors
Stable andhigh-level dividends
Improvement inshareholder value

Employees

Financial
perspectives

・Improvementin addedvalue
・Improvement
in corporate
value

Improvement incustomers' productivity

・Realization of adecarbonized andrecycling-basedsociety・Development ofcustomers'
businesses

Easy-to-work andworker-friendly
workplaces

・Maintenanceof biodiversity

Our sustainable growth・Super smart
society×+ Achievement ofwell-being for employees

・Commercialization of next-generation mobility

Appropriate evaluationand treatment based on
performance
Stable livelihood
Relief for future

Contribution to
innovation forcustomers' products

Solving social andenvironmental issues

Socialperspectives

Skill learning andimprovement
opportunities(growth opportunities)

C

Environmental
perspectives

・Networking society that connects all people
・Vigorous community andsafe and sanitary living

Local and international societies

Naturalenvironment
Realization of
next-generationenergy contributing
to decarbonization
Environmental loads
due to unrecyclable
waste(negative effects)

Contribution to local economies
through employment and procurement

Development of local society through tax payment
Vitalization of intra-community exchanges
and improvement in local brand value
Safe and secure water and less burdenof medical expenses on patientsand Challenge"

better tomorrow than today❸Products contributing
to a sustainable future（Output）

Information
deviceNext-generation
mobility

Smartphones and tablets

Support for EVs,
FCVs, and self-driving

Fast communications

Aircraft weight saving

Contribution to
IoT society

Contribution to
next-generationtransportation devices

Life science

Medical ﬁeld displays

Structural materials forwater processing
and disaster measures

New energy for decarbonization

New challenge
for environmental
change14

ARISAWA INTEGRATED REPORT

Value Creation
Management Capital to Support Value Creation
With the capital built up through repeated growth as our foundation, we will further increase our competitive advantages.
While evolving the value creation process through business strategy management and active initiatives on ESG issues, weraise our corporate value.

Financial capital

Manufactured capital

We have not only working capital but also ﬁnancial capital that

We use facilities that can produce many models in small quanti-

ment, M&A, and DX investment for growth as necessary. Major

that can handle medium to mass production to respond to theallows stable and ﬂexible operation to implement capital invest-

ﬁnancial resources are ﬂexibly gained from cash ﬂow fromoperating activities and borrowings from ﬁnancial institutions.

We set an ROIC goal of 6 % in our mid-term management

plan, aiming for proﬁtability enhancement and capital efﬁciency

improvement. Speciﬁcally, we ﬁrst maintain a healthy cash ﬂow
through business and secure ﬁnancial soundness, and thenactively allocate the capital to new business investment andresearch and development investment for further growth. We will
return the resulting surplus appropriately to our stakeholders.

expansion of the scale of customers' businesses and an integrat-

ed production system, from earlier and post-processes toinspection, we deliver advanced quality control and stablesupply. In addition, in-house development of a control system forproduction facilities achieves production efﬁciency improvement
and cost reduction.

Capital expenditure(Billions of yen）
50

44.8
2.4

40

Intellectual capital
Since our foundation, we have improved our core technologies of"weaving, coating, molding", and "combining" through trial anderror to fulﬁll customers' needs.We have many experienced

engineers who have been involved in development to highly
integrate these technologies and optimize the functions.

Our unique technologies made through research anddevelopment with new innovations based on the experiences

30

25.0

20

6.9
0.9

10

21.4

22.6

5.3
1.5

6.9

8.2

16.5

14.0

12.0

10.8

2018

2019

2020

2021

0.7

0

17.5

21.6

■ Arisawa

0.8

0.5
2.0

■ Domestic subsidiaries

1.0

2.6

■ Taiwan & China

0.8
24.1

2022
■ Europe & U.S.

passed down from senior employees to junior employees are

Human capitalcustomers' businesses. By understanding the characteristics of

Our executives and employees are traditionally serious, sincere,

process and incorporating our core technologies cultivated oversupported more than 100 years of our history. By integrating

positioned as important assets that contribute to the growth of

products required by customers and the in-house manufacturing
the years, we proceed with obtaining an optimized design.

We established a "15 % culture", where employees

engaged in development can spend 15 percent of their working

hours studying what they like, and also set up a program calledhonest, patient, and hungry for challenges, which we can say has
knowledge and technologies cultivated since our foundation stepby step through trial and error, we have offered highly reliable
products to customers.

We have multi-skilled operators who can handle various"the new product development award", which is one of the

products, trained operators with adapting capabilities, andnew products. We will continue to improve the environment so

employed. Turning tacit knowledge into explicit knowledge helps

incentives to employees who contribute to the development ofthat more new products and businesses are born.
Research and development costs
25
20
15
10

20.0

20.7

2.3
2.0

2.1
2.0

0.3

15.4

0.4

16.2

19.1
0.2
2.5
1.5

14.9

19.2
0.2
2.6
1.3

15.1

19.9
0.7
2.5
1.4

15.3

5
0

development specialists, and many of them have been long
us build a stronger human network.
(Billions of yen）

(Billions of yen）

2018

2019

2020

■ Domestic subsidiaries

2021■ Taiwan & China

2022■ Europe & U.S.

Number of employees
1,433

1,425

1,458

108

115

144

367

358

353

345

373

3363

361

358

370

602

614

606

599

599

2018

2019

2020

2021

1,454

1,500

1,432
105

110

1,200

352

900
600
300

■ Arisawa

15

ties to better cater to various customers' needs. With facilities

0■ Arisawa■ Domestic subsidiaries■ Taiwan & China

2022■ Europe & U.S.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Social capital

Natural capital

Based on the relationship of trust with suppliers, we grasp the

In the manufacturing process, we introduce renewable aenergy,

advanced procurement of risk materials. We have also diversiﬁed

resource use, and waste disposal.

circumstances of each industry and take such measures as
suppliers to establish a stable supply chain. Promoting CSR

improve energy use efﬁciency, and reduce CO2 emissions, waterprocurement with respect for human rights, labor rights, and theenvironment while ensuring material quality and stable supply
allows high-quality and stable product-making. With the importance placed on continuous partnership with suppliers based ontrust, we conduct procurement for mutual sustainable growth.

At the time of our entry into the FRP ﬁeld, when we only had

weaving technology, we sincerely focused on prototype-making

to materialize requests while being given technical advice byheavy electric manufacturers. These experiences helped us build
a strong relationship of trust with clients. A person from a trading
company once told me, "Mr. Arisawa, your company is a department store of prototypes." We would like to cherish the relation-

ship with clients who contact us ﬁrst in the consideration or

Water resource use
（k㎥）
500

427.6

300

307.9

241.4

226.9

200
100
0

171.0

186.2

153.6

136.9

2018

2020

2022

prototyping phase, which is a great asset to us.

Rebranding

380.5

400

■ Surface water■ Underground water

On April 1, 2023, Arisawa renewed its logo and announced the brand message shown below.
The company produces and develops "future pieces" to create its own value.

LOGO
Before（ 〜2023.03 ）After（ 2023.04〜 ）"NB" is the design logo of its

The triangle is designed like "A" of Arisawa.

The company stayed long withcore technologies of "weaving, coating, andformer company Nihon Braid.

Its three sides represent the company's

this logo for about 100 years.

molding", and its three colors represent"cherry blossoms", "sky and sea", and"mountains and ﬁelds" of Joetsu City.

We put our thoughts into the logo,

hoping to produce something new andunique to Joetsu based on these threetechnologies.

CORPORATE MESSAGE
The value of a great invention or a great product serving our daily life may vary signiﬁcantly, depend-ing on the comprising material or parts. The responsibility of a player in the ﬁrst stage of manufacturing is huge and heavy. Arisawa is fully aware of this.

We manufacture a variety of pieces of material and parts for ﬁnished products that are not visible

to many consumers. But they certainly exist as indispensable part of our daily life. Our products shore

Where Future
Pieces Ariseup the continuing advancement of technology, by providing the basis for cutting-edge technology andthe footing for further technological development. Arisawa, in a way, is the ﬁrst runner in a relay of
manufacturing who helps blaze a path to the future.

Such future-oriented pieces will be produced here and form distinctive shapes.

Weaving, coating and molding. That is what we basically do to manufacture our products. While

boosting technological innovation, we strive to be a corporation that pays keen attention to therealization of a society friendly to people and the earth. When the ﬁrst step of manufacturing becomes
advanced, the world of manufacturing will undergo vast changes.

Located at Takada in Joetsu City, an area under severe winter weather but otherwise blessed withthe beauty of nature, Arisawa will continue producing original pieces, dreaming forward to theexciting future.

16

ARISAWA INTEGRATED REPORT

Value Creation
Sources of Value Creation (Business Model)
We aim to create a sustainable society and ensure its growth by creating a business model with originality while tackling social issues andthen providing various values to our stakeholders.

Initiatives toward business model evolution
Improvement in sustainable corporate value

Promotion of human resource strategy

To efﬁciently operate business portfolio management for further

To keep offering products and services that exceed the expecta-

scious management with ROIC set as an indicator. As it is import-

strategy that encourages, supports, and nudges motivatedtions of customers and society, we deploy a human resource

improvement in corporate value, we focus on capital cost-con-employees for their growth. We also promote a comprehensive

ant that our management direction is properly understood andorganizational strategy so that employees can work lively under

empathized by our stakeholders, we also provide opportunities

the new Arisawa brand.

for active dialogue.

Enhancement of competitiveness for value creation

Quality improvement

We enhance our competitiveness by creating new value throughUtilizing know-how cultivated through APS (our production

activities targeting new growing markets.

including ones in new ﬁelds.

management system), we will improve our services and quality

the active promotion of carbon neutrality and development

New value creation and challenge for new ﬁelds through co-creation

Promotion of coexistence and shared prosperity with the environment

We will create new value through co-creation by ﬁnding more

Toward long-term coexistence and shared prosperity withpartners who can share the same empathy through open innova-

society, we promote eco-friendly product and technology

tion. We will also expand our business into new ﬁelds to increasedevelopment to actively create new value.

value proposition for further expansion of corporate value.

Direction of business model evolution
We expand the areas of proposal-based business through the active discovery of needs by leveraging the experiences in the existing

business ﬁelds with competitive advantages. We develop needs with our innovative proposals and high-quality product-making based on
the CIC spirit to create new businesses.

Existing
businesses
leveraging
competitive
advantages

17＋

Innovative

Evolution

new businessesof the mid- to

based on thelong-term

CIC spiritmodel● Evolution into a proposal-based business through active discovery of needs● Evolution into an industry front-runner leading toward a decarbonized society● Evolution into "weaving, coating, and molding" + "combining"● Evolution into a global manufacturer from Joetsu to the world

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

New Initiatives for Value Creation

ARISAWAINNOVATES!
With eyes on the next 100 years

The Innovation Center is scheduled
for completion in December 2024
toward growth for 100 years to comeOur Innovation Center aims to be a base for open innovation where unprecedented newvalue is created through the integration and co-creation of technologies with othercompanies and research institutes. To achieve this goal, we introduced a design that
stimulates more communication throughout the company.
For example, the ofﬁce ﬂoor for the engineering division is located on the circulation to our cafeteria. To share ideas immediately, a workshop space is installed next to thelaboratory. This center with an open and connected space is designed in the image of an
igloo. By breaking down silos to share one space with people from different departments
and ﬁelds, we create a place where people and ideas come and go.

Perspective drawing of the exterior of the Innovation Center (above-ground 3-story building)18

ARISAWA INTEGRATED REPORTManagement Policy
Sustainability Management
As "contribute to solving the social and environmental issues, and realize the sustainable growth" is mentioned in ourManagement Policy, we understand that active engagement in social and environmental issues is required in our businessactivities. Speciﬁcally, we set KGI goals, such as achieving our goals (Scope 1 and 2) of carbon neutrality by 2030, andspeciﬁed them in our mid-term management plan. Toward these goals, we have worked on solving climate change issues,
promoting human capital management, and reducing emissions.

ESG Policy

In all aspects of our business activities, we promote environmental conservation and contribute to solving social and environmental issues, aiming toachieve sustainable growth.

ESG promotion organization
We set up the ESG Committee in December 2021 to take theitems and activity status to the Board of Operating Ofﬁcers, theOperating Ofﬁcer was appointed the chairperson, and Executive

Board of Directors makes ﬁnal decisions. The Board of Directors

initiative on climate change issues. Director and Senior Managing

Ofﬁcers and Division Managers were appointed the committee

members to promote the activities. The ESG Committee holds
four meetings a year to raise awareness and promote sustainabili-

ty-conscious management and discuss such themes as a

response to climate change, realization of a decarbonizedsociety, respect for human rights, consideration for work
conditions, and fair and appropriate transactions with clients.
Regardingenvironmental

conservation

activities,

Management Conference, and the Board of Directors, and thechecks the progress of the mid-term management plan, discusses

measures for issues, and reﬂects the results in the management

strategy and risk management and assessment based on the
periodic reports. As shown above, the Board of Directors is
responsible for debating ESG-related agendas and supervising
the goal-setting and the progress of initiatives.

theEnvironmental Protection and Management Committee, whichworks with the ESG Committee, supervises the progress ofactivities conducted by the Carbon Neutrality Project and theBoard of Corporate
Auditors

Board of Directors

Emission Subcommittee and continuously improves them.

Management
Conference

The Procurement Subcommittee sets up the CSR Procure-

Board of
Operating Ofﬁcers

ment Policy under the supply chain management and promotes
CSR activities with suppliers.

Under the concept of human capital management contribut-

ing to corporate value improvement, the Human Capital Subcom-

Environmental Protection
and Management Committee

ESG Committee

mittee was established in March 2023 to link management strate-

Procurement Subcommittee

discuss such matters as setting up a human resource strategy.

Human Capital Subcommittee

gy to human resource strategy. It holds a monthly meeting toNomination &Compensation Advisory
Committee

Linkage

Carbon Neutrality Project
Emission Subcommittee

Each committee periodically reports important agenda

19

Board of Directors- Supervise the entire sustainability

ESG Committee- Promote the entire activities to overcome challenges for sustainability, such as establishing a general sustainability policy, coordinating to set division goals,
and managing their progress

Procurement Subcommittee- Procure eco-friendly materials, provide suppliers with training on human rights, labor rights, safety and health, and corporate ethics in accordance with the
CSR Procurement Policy, and establish a socially acceptable supply chain

Human Capital Subcommittee- Develop human resources who can implement CIC and promote human resource development by linking management strategy to human resource strategy- Develop future leader candidates who can achieve diversity and ensure equal opportunities

Environmental Protection
and Management Committee- Manage budgets and conduct company-wide coordination for activities to reduce environmental loads, such as setting goals for the Carbon Neutrality
Project and the Emission Subcommittee and managing their progress

Carbon Neutrality Project- Establish and implement measures to achieve carbon neutrality by 2030, such as capital investment, technological innovation, use of renewal energy, andimprovement in energy use efﬁciency

Emission Subcommittee- Take the initiative in reducing, removing, and recycling emissions and waste generated in business activities- Research the technology trend toward the realization of zero emissions in 2050

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Materiality (key issue) identiﬁcation
We discussed how to respond to changes in external environ-satisfaction", "promotion of circular economy", and "enhance-international Sustainable Development Goals (SDGs) at the ESG

ny-wide efforts.

ments due to environmental issues and how to contribute toCommittee meetings. Consequently, we designated the following

four items as materiality to be tackled in our mid-term management plan: "Contribution to a decarbonized society", "develop-

ment of diversiﬁed human resources and improvement in job

ment of governance". To solve these issues, we make compaIn the process of identifying materiality, we had the ESG

Committee narrow the items down to four based on the severity
for a sustainable society and the severity for our business.

Severity for a sustainable societyHigh

Decarbonizedsociety

Governance

CirculareconomyHuman resource
development

Social

Our achievement rate

High

Environment

Governance

Low
High

Severity for our businessInitiatives on materiality
We set KGIs (key goal indicators) to achieve in each materiality to increase our corporate value.
Materiality

KGI (Key Goal Indicator)

Promising global goals

Contribution to a

- Achieve carbon neutrality by 2030 - Promote energy and resource saving

decarbonized society- Replace with renewable energy

Development of diversiﬁed
human resources- Develop next-generation human resources- Offer low environmental load materials

Improvement in job
satisfaction- Be a company where all employees can work lively

Promotion of- Reduce emissions

circular economy- Establish a sustainable supply chain

Enhancement of- Be an organization with a strong sense of ethics

governance- Build an organizational structure with an open-door policy

20

ARISAWA INTEGRATED REPORTManagement Policy
Mid-Term Management Plan
Background of formulating a mid-term
management plan and its basic policy
The environment surrounding us has the following various types

6 % in FY2024 (ﬁscal year ending March 2025).

collapse, tightening of regulations, diversiﬁcation of values andproduct development while fulﬁlling users' needs and realize itsof human rights issues, mobility of workplaces, exposure ofmid- to long-term corporate value. Speciﬁcally, to maintain orof issues: Climate change, resource depletion, ecosystem
lifestyles, aging society, divisions of the supply chain, exposure

geopolitics and cyber risks, and progress of innovation. While

being strongly requested to tackle these issues by stakeholders,
including investors, companies must produce beneﬁts to continue
business.

Our group formulated a mid-term management policy basedon the management policy (see page 3) with the motto of"Create, Innovate, and Challenge" and released it in October
2020. By maximizing our corporate value with both businessstrategy and ﬁnancial strategy, we aim to achieve an ROIC goal of

Our group strives to work on technological innovation andsound survival and sustainable growth, thereby increasing its
expand the revenue base of existing businesses, we implement

strategic investments in a new business that maximizes thesynergy effect with existing businesses and has high proﬁtabilityof capital, as well as improving and expanding production
capability and investing in the development of new products that

anticipates users' needs. We also select themes that have impacts
on society and the environment and aim to address their issues
through business.

Business strategy[Enhancement of proﬁtability]■ Strengthen proﬁt management
using ROIC
■ Explore existing businesses■ Create new businesses

Financial strategy

Maximizationof corporate
value[Improvement in capital efﬁciency]■ Convert non-business assets tobusiness assets■ Strengthen return to shareholders

Contribution to the development of a sustainable society

Business strategy
We enhance proﬁtability through "exploration of existing businesses" and "creation of new businesses" and also develop differentiatedproducts with a focus on ﬁelds with growth prospects.

■Develop differentiated products using
unique technologies■Reduce costs thoroughly■Improve production capability andefﬁciency

Creation of
new businesses■Realize external growth throughﬂexible M&A■Realize internal growth through thedevelopment of new products using
existing technologies

Strengthen partnershipwith group companies
to discover new applications
and ﬁelds

Enhancement of proﬁtability

21

Exploration ofexisting
businesses

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Financial strategy
We improve capital efﬁciency by actively returning surplus to shareholders while managing cash ﬂow effectively and converting non-business assets to business assets.

Capital investment

Return to shareholders

Strategic investment

Exploration of existing businesses

Active returnM&A and new businesses■ Maintain and expand the revenue base■ Total return ratio: 80% or more

■ Develop new applications

Set the dividend payout ratio as 80%
and consider share buyback asnecessary by taking demand for funds
into account.

■ Tap into new markets throughexternal growth■ Create new businesses using existing
technologies

Improvement in capital

Planned and actual sales
We set an ROIC goal of 6 % by the end of FY2024, which is higher

and the delay in market recovery. Meanwhile, the sales of FRP

The actual sales for FY2022 fell short of the planned sales

steady growth due to the increased demand in the seawaterpressure vessels for industrial structural materials showed

than the capital cost of 5.9 % (as of the end of FY2022).

desalination business. In addition, the sales of honeycomb

announced on May 12, 2022. The main reasons why we failed to

sandwich panels for aircraft were recorded higher than expected

meet the planned sales and revised the estimates downward in thedue to the recovery in demand in the aircraft industry.

mid-term management plan are the prolonged adjustment ofAmid the lingering stagnation of the electronic material

inventories such as smartphones and semiconductors in theelectronic material market, one of our main businesses, and themarket, we will attempt to put our business back on track ingrowth speciﬁed in the plan is likely to occur one or two years

strategy speciﬁed in the mid-term management plan.

FY2023 and FY2024 by steadily implementing the businessslumping Chinese economy and its slow recovery. The anticipatedlater than expected due to the rebound of stay-at-home demand(Billions of yen）

Overall sales

600

615
549

484

400

430 430(Billions of yen）

536

427

400
300

453

Electronic materials

500

426
297 297(Billionsof yen）

200

2021

2022

2023

338

100

2022

2023

■Actual2024■Planned (May 12, 2023)

2024

Industrial structural materials &electrical insulating materials

150

2021

273 273100
0■Planned (May 12, 2022)

265

200

200

0

339

96 96

117

124 132

137 142

2022

2023

2024

106

50
0

2021

(Billions of yen）

Display materials

100

Changes in ROIC

2021

2022

2023

2024

Value announced on
May 12, 2022

4.4％

4.4％

5.6％

6.6％

50

Value announced on
May 12, 2023

4.4％
(actual)2.8％(actual)

2.7％

5.2％

0

75

25

41

32 32

35

2021

2022

40

45

2023

48

53

2024

■Planned (May 12, 2022) ■Actual ■Planned (May 12, 2023)

22

ARISAWA INTEGRATED REPORTManagement Policy
Businesses / Outline of Each Segment
Our group offers various products by leveraging our excellent processing technologies and centralized production system.

Electronics Materials
P25-26This is our group's main business, which
accounts for more than 60 percent of ourconsolidated sales. There are production sites
in Japan, Taiwan, and China. This business
contributes to the growth of society mainly in
the information device ﬁeld.

Sales and proportion of major products

265

Sales breakdown in the segment

Sales■ Materials for ﬂexible printed circuit boards

Sales
proportion in
the segment

billion yen& semiconductor-related materials■ Rigid printed circuit boards■ Glass cloths for printed circuit boards &prepregs for rigid printed circuit boards

87%
7%
6%

Electricalinsulating
materials

62

Sales in％

42

Display Materials
P29-30This is a group of our products that can berecognized by general people. This business
contributes to the development of people's richlives by offering materials for medical andamusement use.

Displaymaterials
Related products& others

1％

Sales and proportion of major products

42

Sales

billion yen

23

Sales breakdown in the segment

Sales
proportion in
the segment■ Polarization control optical components

54%■ 3D display-related materials

38%■ Others

8%

10

％

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Industrial Structural
Materials
P27-28This is the second pillar of our group's business.
There are production sites in Japan, Spain, andthe U.S. This business contributes to society byoffering materials to improve fuels for aircraft
and vehicles and produce new energy and cleanwater.

Sales and proportion of major products
Sales breakdown in the segment

91

Sales

billion yen

FY2022

7billionSales
proportion in
the segment

Industrial
structural
materials

21％■ FRP pressure vessels for water treatment

61%■ In-vehicle materials

21%■ Honeycomb sandwich panels for aircraft

9%■ Others

9%Electrical Insulating
Materials
P27-28This is a group of products with a long history.
This business contributes to creating a livable
society by offering insulating materials andheat dissipation materials for generators.

Electrical insulating
materials

6％

Sales and proportion of major products

26

Sales

billion yen

Related products & others

Sales breakdown in the segment

Sales
proportion in
the segment■ Prepregs for electrical insulation

44%■ Glass cloths & glass tapes

23%■ Others

33%

The related product and other businesses handle pultrusion molding
production, golf driving range operation, and logistics and transport.

24

ARISAWA INTEGRATED REPORTManagement Policy
Strategy by segment

Electronic Material Segment
In the electronic material ﬁeld, we develop and manufacture materials for printed circuit boards, semiconductor-relatedmaterials, and printed circuit boards, all of which are key devices for information and communication society, using thefollowing four core technologies:
Surface processing
technology to maximize
the performanceof glass cloths

Compounding technologyof mixing denaturants
and chemicals into
thermosetting resins

Resin coating
technology

Laminating

Our group's products range from prepregs for rigid printed circuit boards to materials for ﬂexible printed circuit boards (FPC). Especially,
our materials for ﬂexible printed circuit boards have gained acclaim for its production process with excellence in ﬂexibility, anti-migration
property, and heat resistance at high temperatures and ultra-narrow gaps. With the deep trust of customers, we have retained our position
as one of the top manufacturers specializing in electronic materials.

Business locations

Analysis of the present situations[Arisawa](Nakadahara Factory, Nakadahara-nishi Factory,
Minami-honcho Factory)
Materials for ﬂexible printed circuit boards,
prepregs for rigid printed circuit boards, &semiconductor-related materials

SWOT analysis based on the present business environmentis shown below:

S

Strengths-Design ﬂexibility with in-house
resin compounding technology-Support for various types ofprocessing using equipment[Arisawa Fiber Glass]

Glass cloths for printed circuit boards[Satosen]

Rigid printed circuit boards

Overseas ofﬁces［ThinFlex］(Taiwan)

Materials for ﬂexible printed circuit［TopFlex］(China)O-Differentiated products
high functionality andqualityBusiness environment
Electronic devices, such as smartphones, are becoming more highly functional, andelectronic circuits have a higher circuit density through reﬁning, accordingly.

There are growing needs for materials supporting fast transmission, high heatdissipation, high heat resistance, and large current in a wide range of application
areas, from home appliances to in-vehicle parts, and we work on developing highly

25

with
high

-Flexible proposals, selectedfrom a variety of products

Materials for ﬂexible printed circuit boards

functional products in response to these needs.

Opportunities

W

Weaknesses-Lower production efﬁciency
due to the production of manymodels in small quantities-An
excessive
numberofinspectors required to maintainqualityT

Threats-Low-price strategy of overseas
competitors-Slowdown in demand growth forPCs, tablets, and smartphones

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Sales transition (Billions of yen）

Business strategy

299

298

To enhance proﬁtability according to the mid-term management plan, we work265

on "exploration of existing businesses" and "creation of new businesses".

Regarding electronic materials, we aim to grow them as our primarybusiness with two strategies. We develop new products mainly in the mobile,
semiconductor, and in-vehicle ﬁelds for business expansion. We also deepenties with our group companies to strengthen the business foundation in the
Asian markets.

2020

2021

2022

Business summary for FY2022 and measures and outlook for FY2023
The sales of materials for ﬂexible printed circuit boards and glass

my due to the continued high prices of energy and raw materials

from the previous year due to the downturn in demand for PCs

decline in the Chinese market.

cloths for printed circuit boards experienced a signiﬁcant decline
and smartphones, especially in the Chinese market, since theamid the prolonged Ukrainian crisis, global inﬂation, and demand
Inventory adjustments continue due to the decrease inlatter half of FY2022. Regarding materials for smartphones,

demand for PCs and smartphones, and it is assumed that it will

new domestic users and in cooperation with ThinFlex for Chineseboards and glass cloths for printed circuit boards to recover.

deliveries of materials for ﬂexible printed circuit boards began forusers.

The semiconductor and in-vehicle markets are expected to

grow in the long term, so we have developed differentiatedproducts to be used in these markets.

take a while for the sales of materials for ﬂexible printed circuit
Amid ﬁerce competition in products and costs with overseas

competitors, we will boost our competitiveness by offering differentiated products and establishing global ties with our afﬁliates.

In FY2023, there is still an uncertain outlook for the econo-

Exploration of existing businesses

Businessstrategy

Goals forFY2023Creation of new businesses

Business enhancement in the mobile ﬁeld

Commercialization in the semiconductor and in-vehicle ﬁelds■ Create value for customers and continue growth by offering
products with originality■ Develop new products and strengthen the business foundationin the Asian markets by establishing ties with our group companies■ Develop new products and enter new ﬁelds■ Expand business in growing ﬁelds by strengthening
competitiveness in production and technology

Higher functionality for application to circuit boards

Development in preparation for versatile application■ Higher density, extra-ﬁne line, and tiering of mobile circuits■ Fast-transmission, high-frequency, and 5G/6G millimeterwave compatible circuits■ In-vehicle: High heat-resistant, large-current, and longer circuits■ Enter new ﬁelds(Explore the needs for application to other than circuits)■ Offer environmentally sound products■ Co-develop products by strengthening partnership with customers,
material manufacturers, and private research institutes

TOPICS

Start operation of new coating machine
ai-coater in September 2023
We started operating a new small
experimental coating machine
known as ai-coater in September
2023. It helps us reduce theproduct development period. We
will also use this machine topromote open innovation to win
over co-development projects
and new OEM projects.

Set up a new production line in TopFlex
To capture business opportunities
in the growing market of ﬂexible
printed circuit boards in Asia,
mainly Greater China, we set up a
new production line in TopFlex(wholly owned by ThinFlex) andwill begin the operation in the ﬁrst
half of FY2024.

26

ARISAWA INTEGRATED REPORTManagement Policy
Strategy by segment

Industrial Structural Material andElectrical Insulating Material Segment
In the industrial structural material and electrical insulating material ﬁelds, we pursue FRP (Fiber Reinforced Plastic)
molding technology based on our core technologies of weaving and resin impregnation technology. FRP molded products
are made by laminating prepregs, which are semi-cured through the impregnation of resin into the ﬁber, turning them into
a desired shape, and applying heat and pressure to it.

Using glass ﬁber with insulation capability and heat resistance and carbon ﬁber with lightweight, high strength, and a high module of elasticity as main materials and leveraging FRP-speciﬁc anisotropy generated by the orientation of ﬁber optimizes FRP materials to bring out
desired mechanical and thermal properties. With these characteristics, they are used in electrical insulating materials for such devices as
generators and motors, materials for aircraft interiors, primary structural materials, general industrial structural materials, materials in thein-vehicle and new energy ﬁelds, and materials for sports equipment.

Business locations

Analysis of the present situations
SWOT analysis based on the present business environmentis shown below:[Arisawa] (Nakadahara Factory & Minami-honcho Factory)
FRP pressure vessels for water treatment (ﬁlament winding molded products),
honeycomb sandwich panels for aircraft, prepregs, prepregs for electrical insulation)[Arisawa Fiber Glass]

Glass cloths, glass tapes,
special ﬁber woven products[Arisawa Sogyo]

FRP (pultrusion moldings), prepregs[Arisawa Jushi Kogyo]
FRP

Strengths-Consistent development andmanufacturing
throughtheintegration of core technologies
of "weaving, coating, andmolding"-Flexible new resin formulationand improvement

O

Opportunities

Overseas ofﬁces-Demand recovery in the aircraft
ﬁeld［Protec Arisawa Europe, S.A.］(Spain)-An entry to markets requiringhigh heat resistance, highpressure resistance, and gas
resistance［Protec Arisawa America, Inc.］(U.S.)
FRP pressure vessels for water treatment(ﬁlament winding molded products)

Business environment
Amid the shift to a decarbonized society, the demand for FCVs (Fuel Cell Vehicles)

and EVs (Electric Vehicles) has been growing, which requires transportation
methods, including aircraft, to be lighter weight for improved fuel efﬁciency. Thereis also a growing demand for new energy sources that replace fossil fuels.

In the life science ﬁeld, demand is also up for products for water treatment(seawater desalination) and infrastructure reinforcement as measures against

disasters. Our group has developed highly functional products to fulﬁll these needs.

27

S

W

Weaknesses

T

Threats-Easily affected by market
changes due to many types oflimited products sold to speciﬁccustomers-Lower production efﬁciency
due to the production of manymodels in small quantities-Long-term experience requiredin human resource development-Competition
domestic
competitors

in costs withandoverseas-Competition in costs with othermaterials (metal, ceramic, etc.)

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Sales transition (Billions of yen）

Business strategy

111
To enhance proﬁtability according to the mid-term management plan, we work

117
97

on "exploration of existing businesses" and "creation of new businesses".

Regarding industrial structural materials and electrical insulating

materials, we develop unique products for further growth, focusing on thetransportation infrastructure, water treatment, and new energy ﬁelds as our
main businesses.

2020

2021

2022

(Fiscal year)

Business summary for FY2022 and measures and outlook for FY2023
The sales of industrial structural materials for FY2022 increased

In FY2023, the COVID-19 pandemic has ﬁnally shown signs

from the previous year due to the steady demand for FRP

of abating after a few years, and the aircraft industry is on a

The demand for honeycomb sandwich panels for aircraftcontinued strong demand in the water treatment ﬁeld. Meanwhile,

pressure vessels for water treatment and in-vehicle materials.

began to pick up again in the latter half of FY2022. The sales ofelectrical insulating materials for infrastructure were stably solid.
FRP pressure vessels for water treatment saw an increase inmoderate recovery track. It is also expected that there will be

the prices of energy and raw materials continue to soar, which willneed to be closely watched.

By continuing to produce differentiated products throughsales due to the technical support to Protec and have been

the expansion of application of our materials into new ﬁelds, suchcle materials, we deepened relationship of trust with users andtreatment, we will boost competitiveness through global coopera-

considered to be applied to the medical ﬁeld. Regarding in-vehideveloped differentiated products in new ﬁelds.

as ﬁlament winding technology to other ﬁelds than watertion with our afﬁliates.

Exploration of existing businesses

Businessstrategy

Goals forFY2023Business enhancement in the transportation infrastructureﬁeld and revenue expansion in the water treatment ﬁeld

■ In-vehicle: Make differentiation and enter markets using unique technologies■ Aircraft: Increase added value through the anticipation of users' needs■ Water treatment: Create new demand by developing
high-performance products

Creation of new businesses
Commercialization in the hydrogen energy ﬁeld
■ Enter the hydrogen energy and superconductivity ﬁelds andpromote the development for commercialization

Higher functionality and versatile application

Development in preparation for versatile application■ Aircraft: Increase the production of honeycomb sandwich panels
for interiors and develop new materials*■ Water treatment: Create new demand by developing
high-performance products, as well as ultra-high-pressure vessels■ In-vehicle: Adopt new mechanical components and materials for
FCVs and EVs■ Hydrogen energy: Do a carbon-neutral business mainly for materials
and products■ Superconductivity: Expand the adoption range by grasping needs anddeveloping customized products■ Offer environmentally sound products■ Co-develop products by strengthening partnership with customers,
material manufacturers, and private research institutes* High-strength lightweight panels, etc.

TOPICS

Our ultra-thin coating technology is applied to
Toyota's FCV MIRAIOur ultra-thin coating technology is applied to the special titanium foil
used for MIRAI --hydrogen fuel cell vehicle by Toyota Motor Corporation. Special titanium foil is used in a ﬂow channel (separator) for
power generation by combining hydrogen and oxygen. During press
molding, the mold heavily wears as titanium is hard. However, we
succeeded in applying lubricant to this special titanium foil with athickness of a few micrometers. Applied lubricant results in less moldwear, reducing the number of mold replacements by half compared toconventional technologies.

28

ARISAWA INTEGRATED REPORTManagement Policy
Strategy by segment

Display Material Segment

In the display material ﬁeld, we have expanded our technological areas from front screen molding, UV molding, and thin ﬁlm
coating to 3D images. Xpol® is a 3D image display ﬁlter with ﬁne polarizing elements arranged in order. Attaching thisﬁlter to a ﬂat panel display, such as an LCD, allows 3D images to be viewable without ﬂickering through polarized glasses.
This ﬁlter has been used mainly for medical purposes, such as endoscope monitors.

We have developed an optical retardation element (wave plate) that can be a phase difference plate using a photo-alignment layer and apolymerizable liquid crystal and offered it as a product. We not only offer optical materials but also add a bit of contrivance to them to gain
the trust of customers. One such example is lamination processing. Our advanced lamination technology has been developed through theexperience of handling a wide range of optical materials and has been highly acclaimed. By reconsidering the properties of "light", we will
work on further product development.

Business locations

Analysis of the present situations
SWOT analysis based on the present business environmentis shown below:[Arisawa](Nakadahara Factory)
3D display-related materials[ColorLink Japan]
Polarization control optical components

S

Strengths

O

Opportunities-Xpol® brand value-In-house 3D optical design-Massproduction
factories
available for in-house core
processing-Flexibility for the production ofmany models in small quantities-Growth opportunities in the
Asian markets-Spread of minimally-invasive
treatment to the medical ﬁeld
-Acceleration and penetration of
remote surgeries due to ashortage of doctors

Business environment
Under circumstances where a shortage of doctors and the concentration of population in urban areas have occurred, the spread of fast communications allows remotesurgeries and robotic arm surgeries, hopefully reducing the workload on doctors. As

the demand for displays is also expected to rise in the education ﬁeld due to theprogress of digitization, we have developed highly functional products to meet theseneeds.

29

W

Weaknesses

T

Threats-Energy costs required tooperatemass
production
facilities (a higher processing
cost percentage)-A lower level of compounding
technology
thanmoldingtechnology-Emergence of different types of
3D displays-Competition in costs withoverseas competitors

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Sales transition (Billions of yen）

Business strategy

42

To enhance proﬁtability according to the mid-term management plan, we workon "exploration of existing businesses" and "creation of new businesses".

Regarding display materials, we will expand the sales of new products

33
24

utilizing our unique technologies mainly in the medical high-deﬁnition display
ﬁeld.

2020

2021

2022

(Fiscal year)

Business summary for FY2022 and measures and outlook for FY2023
An increase in the sales of 3D-related materials and ColorLink(non-medical ﬁelds) while capturing business opportunities inthe total sales for FY2022 from the previous year.

achieving a higher deﬁnition.

Japan's sales of materials for the use of polarization pushed up
Regarding 3D-related materials, we are working on reduc-ing costs through process improvement, expanding their applica-tion to non-medical purposes, and preparing demonstration
content for proposals to companies in the target ﬁelds.

the medical ﬁeld in the Chinese market. We will also work on
By offering differentiated products, such as PSA (Pressure

Sensitive Adhesive) sheets, and establishing global ties with our
afﬁliates, we will boost our competitiveness.

In FY2023, we aim to continue growth through the expan-

sion of our businesses, mainly Xpol®, and the development andsales of new products. Regarding 3D displays, we are planning to
expand the sales channels for educational and general industries

Exploration of existing businesses

Businessstrategy

Goals forFY2023Creation of new businesses

Business enhancement in the medical
high-deﬁnition display ﬁeld

Commercialization in new ﬁelds■ Expand the share of endoscopes and microscopes and attract
overseas users■ Expand the sales channels for telemedicine and robotics use■ Meet the needs for a higher deﬁnition■ Expand 3D ﬁlter application into non-medical ﬁelds

Higher functionality and versatile application

Development in preparation for versatile application■ 3D display: Expand the sales channels in the Chinese market andnon-medical ﬁelds and achieve a higher deﬁnition■ Screen: Improve the yield rate through technical support to
afﬁliates and expand the application of existing products■ Offer environmentally sound products■ Co-develop products by strengthening partnership with customers,
material manufacturers, and private research institutes

TOPICS

Begin offering medical 3D monitors for
robotic surgeries

Medical 3D monitors, which are designed for endoscopic and microscopic
surgeries, have been offered for robotic surgery use since FY2023. They
were originally introduced as monitors for assistants around the roboticarm, but we are seeing this opportunity as a chance to apply them as cockpit
monitors for operators. As the patent for the major robotic surgery systemda Vinci expired, there are many new entries from various manufacturers.
The expansion of sales channels by gaining new customers will help expand
the needs not only for robotic surgeries but also for the purpose of existingendoscopic and microscopic surgeries.

30

ARISAWA INTEGRATED REPORTManagement Policy
Financial strategy
Aiming for further growth and corporate value improvement
Our consolidated ﬁnancial results for FY2022 saw sales andproﬁt declines with net sales of \42.7 billion (down 0.9 %, year
on year) and operating proﬁt of \2.2 billion (down 32.9 %, year

differentiated products and expand their sales to further improveand enhance proﬁtability.

Our group drew up a new mid-term management plan inon year). This is because economic activities have been resumed

2020 with FY2024 set as the target year to clarify that we will be

COVID-19 infections, but there is still an uncertain outlook forbusinesses. We actively return surplus to shareholders andby easing restrictions on people's activities during the spread ofthe economy due to the continued high prices of energy and raw

materials amid the prolonged Ukrainian crisis, global inﬂation, anddemand decline in the Chinese market.

In FY2023, harsh external environments are likely tocontinue, such as continued high energy prices and inﬂation.
Even in such business circumstances, we will develop attractive

committed to exploring existing businesses and creating new
improve capital efﬁciency by managing cash ﬂow effectively andconverting non-business assets to business assets from theﬁnancial strategic viewpoint for a stronger revenue base while

proceeding with a business strategy targeting ﬁelds withprospective future growth.

Aggressive and defensive business management through the introduction
and spread of ROIC management
Our group used to set a ﬁnancial target with operating proﬁt

FY2020. The set goal is 6 % or more, which is higher than ourtions required in our business environment and by our stakehold-FY2022, calculated by us based on the value measured by amargin and ROE as our KPI goal. To adapt to changes in expecta-

ers, however, we decided to adopt ROIC as our KPI goal toward

the shift to capital cost and corporate value-conscious manage-

ment based on the mid-term management plan formulated inshareholders' cost of capital WACC of 5.9 % (as of the end of
third-party organization).

In addition, we use ROIC not only for management KPI but

also as a judgment tool for investment in facilities.

Investment for growth
Our group allocates funds we have now and will gain during thecurrent ﬁscal year to production capital expenditure to support

Details of capital expenditure for FY2022 to 2024

the expansion of existing business areas and growth investment

Increase in production capability

ment, research and development, human resource development,

8.1billion

to create new business. We also spend capital on quality improveand digitization to aim at strengthening the business foundation.

Achieving continuous growth while maintaining our competitive

advantages through these activities will lead to a virtuous cyclethat allows reinvestment for further growth of our group.

Improvement in the production process

1.1billion

Transition of capital expenditure
100

84

75

25
0

44

31

26

22

FY2021(Actual)- A waste heat recovery system- Onsite solar energy generation(Promotion of carbon neutrality)- A production management system and security measures(Promotion of DX)

New product development(Billions of yen）

50

- Production facilities in ThinFlex(Expansion of sales in the Chinese market)- Production facilities for insulating ﬁlms for semiconductorboards (Expansion of existing businesses)

FY2022(Actual)FY2023(Planned)

FY2024(Planned)

5.9billion- Innovation Center(Establishment of an open innovation base)- A small coating machine and testing facilities(Exploration of existing businesses and creation of new businesses)

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Policy of determination on dividends from surplus, etc.
We will proactively return its funds earned during the period topolicy is a total return ratio of 80% or more for perfor-

expansion of its revenue base for existing businesses and thetion of treasury shares in total consideration of demand of funds,

shareholders as well as invest them in the maintenance andcreation of new businesses. Speciﬁcally, the company s basic

mance-linked dividend and we will respond ﬂexibly to an acquisiﬁnancial conditions, etc.

Business overview for the past 5 years(Millions of yen)

FY2018FY2019FY2020

FY2021

FY2022

44,72845,97046,43943,08942,722

4,297

2,783

3,578

4,204

2,717

Operating results
Net sales

3,119Operating proﬁt
Ordinary proﬁt
Proﬁt attributable to owners of parent
By Segments
Electronic materials

Net sales
Segment proﬁt

Industrial application

Net sales

structural materials

Segment proﬁt

Electrical insulating materials

Net sales
Segment proﬁt

Display materials

Net sales
Segment proﬁt

Financial Position
Total assets
Net assets
Equity ratio（％）
Return on equity（％）
Interest-bearing liabilities
Return on Invested Capital（％）
Cash ﬂows
Cash ﬂows from operating activities
Cash ﬂows from investing activities
Cash ﬂows from ﬁnancing activities
Cash and cash equivalents at the end of period
Per-share Indication
Basic earnings or loss per share (Yen)Net assets per share (Yen)Price earnings ratio(Times)
Dividend per share(Yen)Consolidated dividend payout ratio（％）
Number of shares issued and outstanding(Thousands of shares)
Other
Capital expenditure
Depreciation
Research and development expenses
Consolidated number of employees

2,861

2,762
212

3,118
2,160

3,320
3,911

2,228
2,856

28,77029,76531,65029,76826,543

8,395

8,974

8,842

7,053

9,128

2,620
1,393
3,127

2,331
1,475

2,981
939

2,907
872

1,223
1,315

2,984

2,340

2,604

3,699

3,427

2,820

3,253

4,162

73,096

71,70967,257

68,68967,659

69.3%

64.3%

68.8%

69.6%

69.5%

430
114

53,462
5.7%

366
235

49,018
0.4%

7,905

8,356

2,893

4,837

（576）

（4,431）

3.9%（3,304）
7,718
79.15

3.6%

6,580

14,725

6.14

192
221

47,444
4.7%

303
815

47,965
8.3%

2,582

184

1,024

47,107

6.0%

8,273

9,073

10,240

610

5,901

3,471

（5,703）（4,042）（2,572）

4.2%

1,567

11,488
64.94

4.4%

2,869

16,893117.402.8%

508

18,53586.46

1,397.78

1,387.76

1,388.50

1,434.46

1,422.43

30.00

30.00

39.00

95.00

90.00

10.0

130.7

37.9%

488.6%
36,381

2,500
2,001

36,226

1,901
1,432

15.4

14.5

34,47080.9%

33,614104.1%

2,168

2,144

2,268

4,486

2,074

1,905

1,926

1,991

1,982
1,454

60.1%

8.2

2,107
1,433

2,170
1,425

33,541

2,290
1,458

Note: The Accounting Standard for Revenue Recognition, etc. are applied to the ﬁgures from FY2021.

32

ARISAWA INTEGRATED REPORT

Sustainability（E）
Environmental Management
Environmental Policy
Our corporate group will carry out the following measures in order to reduce environmental loads and promote environmental conservationfor our overall business activities from development and design to manufacturing of electronic materials, industrial application structural

materials, electrical insulation materials and display materials, and to contribute to solving the social and environmental issues and realize
the sustainable growth.

❶ To strive towards the prevention of environmental pollution by accurately determining the environmental impact of our business activities, products
and services.
❷ To comply with environmental laws, regulations, agreements and other requirements to which we have agreed.
❸ To establish and carry out "Environmental Goals" and review them periodically in promoting environmental activities.
❹ To develop the products and technologies contributing to reducing environmental loads.
❺ To strengthen the management of hazardous chemical substances which might have an impact on the environment.
❻ To strengthen the management of air, water, and soil pollution and strive to maintain biodiversity.
❼ To work toward resource saving, energy saving, industrial wastes reduction and recycling promotion.
❽ To contribute to reducing greenhouse gas and creating a recycle-based society by introducing renewable energy and recyclable resources.
❾ To raise awareness of all employees through environmental education and enlighten them so that they will take responsible actions for a sustainable society.
❿ To continually improve the environmental management system by performing periodic internal environmental audits and management reviews.

Promotion Structure ofEnvironmental Protection

Board of Directors

Management
Committee

Environmental protection activities are promoted

Environmental Protection and Management Committee
Chairperson

Operating Ofﬁcer supervising Quality Assurance Dept.

Vice
chairperson

nvironmental Manager→Selected from pollution prevention supervisors

as a whole by the factories and afﬁliates on thepremises at three sites (Minami-honcho, NakadaEnvironmental

Protection

andSecretariat

Board of Operating
Ofﬁcers

hara, and Nakadahara-nishi) in Joetsu-shi. The

Committee
memberManagement

Committee uses the PDCA cycle and is engaged in

Cooperate

the protection activities in cooperation with the
ESG Committee.

ESG Committee

Quality Assurance Dept.

Manufacturing Dept.
→Executive ofﬁcer in charge, General manager,
Group leader
Technology Dept., Manufacturing Engineering Dept.
Quality Assurance Dept. Internal Auditing Ofﬁce,
Arisawa Sogyo, Arisawa Fiber Glass→ Executive ofﬁcer in charge, Group leader

Material Balance
Our group strives to reduce environmental loads by understanding the balance between energy and resource inputs in business activities
and CO2 and waste emissions generated as a result.

INPUT

FY2021

FY2022

Energy Inputs
Fuel

FY2022

8,663 kL

7,332 kLSum

32,564 ton

26,681 ton

City gas

7,456 千m3N

6,307 千m3N

Fuel

16,747 ton

14,165 ton

5.0 ton

4.0 tonElectricity

15,817 ton

12,516 ton

9,544 kL

8,100 kL

38,117 千kWh

32,327 千kWh

110 ton

135 ton(crude oil equivalent)Electricity

Purchased items

Organic solvent air emissions
Substances subject to the PRTR system
Industrial emissions

10,262 ton

9,009 tonSum

1,658 ton

1,643 ton

9,264 ton

8,078 ton

Recycled (reused)

1,605 ton

1,596 tonIncl. organic solvent

580 ton

608 tonLandﬁll disposal

53 ton47 tonSecondary materials

998 ton

931 ton

Chloroﬂuorocarbon emissions- ton

1.12 ton

Total inputs

380.5 千m3

307.9 千m3

Surface water

153.6 千m3

136.9 千m3

Underground water

226.9 千m3

171.0 千m3

Sum
Raw materials

Water inputs

33

FY2021CO2 emissions

Sum (crude oil equivalent)
LPG

Electricity

OUTPUT

Emissions by a chloroﬂuorocarbon

Period covered: FY2022 (April 2022 to March 2023)
Business sites: Joetsu Head Ofﬁce and Minami-honcho Factory(including Arisawa Fiber Glass Co., Ltd. and Arisawa Sogyo Co., Ltd. within the premises)
Nakadahara Factory (including Arisawa Sogyo Co., Ltd. within the premises)
Nakadahara Nishi Factory (including Arisawa Sogyo Co., Ltd. within the premises)

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Environmental Targets, Results and Assessment for FY2022
We have established the environmental management system in accordance with ISO 14001, and we identify and evaluate importantenvironmental risks and opportunities through its operation and determine how to address environmental issues.
No.

Environmental

Target Values

1

Develop the products and technologies contributing to
reducing environmental loads

Develop 6 items or more during the period

Developed 6 items

Achieved

1) Survey environmental hazardous materials of existingpurchased speciﬁcations

Obtain data and guarantees as required

230

Achieved

2) Grasp the disclosure of CSR procurement policy andthe measures of suppliers

Survey 30% of sellers

31％

Achieved

Neither cause a new environmental pollution or healthdamage, nor commit the material violation of laws andregulations to sustain biodiversity

Commit no material violation of laws
and regulations

0

Achieved

Save energy at Minami-honcho Factory

Reduced by 18% comparedto the past results231) Save energy (reduce electricity and city gas)

Reduce energy amount kL by 1% compared to thepast results, or reduce energy amount kl/processing
output by 1% compared to the previous year

Save energy at Nakadahara Factory and
Nakadahara Nishi Factory

Reduce energy amount kL by 1% compared to thepast results, or reduce energy amount kl/processing
output by 1% compared to the previous year

42) Achieve zero emissions

5

6

7

Maintain a recycling rate of 90% or higher

Results

Reduced by 1.1% comparedto the previous year
Reduced by 18% comparedto the past results

Reduced by 3.6% comparedto the previous year

Evaluati

Achieved

Achieved(recycling rate = amount of recycling / amount ofindustrial waste disposal)

97.1％

Achieved

3) Reduce industrial waste

Reduce industrial waste by 2% comparedto FY2020

Reduced by 5.8%
compared to FY2020

Achieved

Reduce CO2 emissions(achieve carbon neutrality by FY2030)

Reduce CO2 emissions by 21% comparedto FY2020

Reduced by 37.3%
compared to FY2020

Achieved

1) Conduct a general education and training

Conduct once a year at each department

Conducted

Achieved

2) Conduct training for employees engaged in
speciﬁed work

Conduct once a year at a relevant department

Conducted

Achieved

3) Conduct training for hired and transferred employees

Conduct at hiring or transferring

Conduct as required

Achieved

1) Conduct volunteer activities

Conduct once a year or more

Conducted once

Achieved

2) Issue an environmental report

Publish on our website in OctoberIssued in October

Achieved

Environmental Compliance

Employee Education on Environment

We received two complaints about noise from neighborhood in

We conduct general education every year aimed at increasing

Both were due to the operating sound of air conditioner

with environmental laws and regulations related to our business

FY2022.

compressor units. We obtained the neighborhood s approval byimplementing measures, such as installing soundproof shielding

plates on the units, changing operating hours, and limiting theemployees

environmental awareness, including complianceactivities, sharing of information with stakeholders, and spreadof our environmental targets.

In addition, we have established the procedures fornumber of units in operation.

preparing for and responding to emergency, including theenvironmental issues through communication with parties

accidents, and conduct education and training every year at theWe will continue to promptly respond to complaints about

concerned.

prevention of environmental pollution due to disasters andfactories and research facilities at high environmental risks. No

incidents occurred that could have a major impact on asurrounding environment in FY2022.

Furthermore, we are implementing measures to expand

specialized knowledge, such as training ISO 14001 internal
auditors and educating employees engaged in speciﬁc tasks.

34

ARISAWA INTEGRATED REPORT

Sustainability（E）
Responding to Climate Change
We support the recommendations by the Task Force on Climate-related Financial Disclosures (TCFD). We have also participated in the TCFD

Consortium, a platform where supporting companies and ﬁnancial institutions discuss. We consistently improve our environmental protection

activities by promoting the reduction, etc. of electricity and gas consumption, hazardous chemical substance, and industrial waste inaccordance with the Environmental Policy, as the Environmental Protection and Management Committee deliberates on the activities.

Under the philosophy that the solution of environmental issues leads to value creation for society as well as the reduction of businessrisks, we publicized Carbon Neutral Initiatives on our website in June 2021 because we especially recognize climate change as a pressing
issue.

ESG Policy

In all aspects of our business activities, Arisawa actively addresses a variety of issues

related to environment, society and governance and aims to achieve sustainable growth.

Governance (Promotion Structure)

Metrics and Goals

We established the ESG Committee in December 2021 in order

We have implemented various measures to improve energy use

At the committee, a director and senior managing operat-

ment of the measures, but also aim to achieve carbon neutrality

to take the lead in addressing climate change issues.

ing ofﬁcer serves as a chairperson, and operating ofﬁcers andgeneral managers of each division serve as members, promoting the organized activities.

The ESG Committee deliberates four times a year onthemes, such as responding to climate change, realizing a

efﬁciency. From now on, we will not only expand the deployin FY2030 (compared to CO₂ emissions in FY2020)* in termsof direct emissions (Scope1) and indirect emissions (Scope2)

by using renewable energy and purchasing carbon neutral gas
as well as promoting the development of low-carbon products.

decarbonized society, respecting for human rights, consider-ing for working environment, and having fair and appropriate
transactions with business partners, in addition to enlightening
and promoting sustainability-conscious management.

Important matters to be deliberated and the status of theactivities, etc. are regularly reported by each committee to theBoard of Operating Ofﬁcers, the Management Committee andthe Board of Directors, and the Board of Directors makes theﬁnal decision.

Please refer to the ESG Promotion Structure on page 19

for a promotion system on ESG.

Risk Management
We recognize that climate change-related risks are importantmanagement issues. Therefore, the ESG Committee identiﬁes
and assesses the climate change-related risks, and reports to

the Board of Operating Ofﬁcers, the Management Committee

and the Board of Directors, thereby deﬁning key issues. We
improve our risk management system by managing these risks.

As for assessing the climate change-related risks, upon

identifying climate change factors in businesses, we assume
the changes of future regulations, and societal, technologicaland climate conditions for each 1.5°
C and 4°
C scenarios.

Please refer to the materiality and KGI on page 20 for theissues that we address and our vision for the future.

35

About Arisawa

Strategy

Value Creation

Management Policy

Sustainability

Company Overview

We analyzed the effects as of 2030 by using two scenarios, the 4°
C scenario* and the 1.5°
C scenario*, targeting at ourwhole supply chain from purchase, development, production to sales of products and services. Upon scenario analysis,the ESG Committee identiﬁed signiﬁcant risks and opportunities related to climate change and assessed ﬁnancial impacts
that those would have.

*Source: The Ministry of the Environment Practical Guide for Scenario Analysis in line with TCFD Recommendations 3rd edition

Risks
Transition/ PhysicalTransition

Impact of transition to a decarbonized society

Physical

Impact of natural disasters

Financial Impacts

Assessment

Responses

Carbon price(carbon taxes)

Factors

・Increase in operating costs due to the implementation ofcarbon taxes【1.5℃】Large

Emissions trading

・Additional costs incurred for credit purchases, etc.

【1.5℃】Large

Response to GHG
emissions regulations

・Increase in costs for renewing equipment ﬁxtures with highefﬁciency・Regulations on the use of chloroﬂuorocarbon【1.5℃】Large

・Set targets for energy saving and CO₂ emissions reduction in thecompany-wide environmental targets
・Set targets for achieving carbon neutrality by 2030
・Save energy and purchase renewable energy
・Set targets for a recycling rate
・Reduce energy consumption by productivity improvement
・Consider renewing with energy-saving equipment in compliancewith regulations
・Promote capital expenditure by introducing ICP

Plastic regulations

・Increase in costs due to regulations on plastic packaging 【1.5℃】Medium
materials

・Reduce usage
・Consider replacements

Renewableenergy policy

・Increase in energy costs due to higher renewable energy
prices

【1.5℃】Large

・Set targets for energy saving and CO₂ emissions reduction in thecompany-wide environmental targets
・Promote investment in energy saving
・Reduce energy consumption by productivity improvement
・Set targets for achieving carbon neutrality by 2030

Change in raw
material costs

・Increase in procurement costs due to carbon taxes andother regulations
・Increase in raw material costs due to soaring crude oil andcopper prices【1.5℃】Large

・Reduce the usage of raw materials by improving yield・Select suppliers based on risk assessment

Change in customer
reputation

・Decrease in sales due to suspension in trading and market
share loss when environmental friendliness cannot be
addressed【1.5℃】Large

・Introduce our initiatives by externally delivering
Environmental Policy and issuing environmental reports
・Publicize initiatives for ESG, TCFD, and carbon neutrality

Change in investor
reputation

・Avoidance of investment and loan from ﬁnancial institutions
and investors when disclosing climate change-related
information is delayed【1.5℃】Large

・Issue integrated reports

Increased severity of
extreme weather events

・Increase in costs to deal with the suspension of operations 【1.5℃】Medium
and logistics functions【4℃】Large
・Delivery delay of procured materials
・Increase in procurement (transportation) costs

・Store inventory of four months worth of raw materials whose
replacements are not available in raw material procurement
・Require suppliers of BCP measures
・Dual vendor system
・Increase productive capacity with capital expenditure
・Renew aged buildings

Rise in averagetemperature

・Increase in energy costs with increase in the frequency of
the use of air-conditioners【1.5°C】Small【4°C】Medium・Set targets for energy saving and CO₂ emissions reduction in thecompany-wide environmental targets
・Promote investment in energy saving
・Paste heat-insulation sheets on windows directly exposed to
sunlight

Financial Impacts

Assessment

Responses

theOpportunities
Transition/ PhysicalFactors

Transition

Impact of transition to a decarbonized society

Physical

Impact ofnaturaldisasters

Emissions trading

・Additional revenue when emission allowances are excess【1.5°C】Large・Set targets for energy saving and CO₂ emissions reduction in thecompany-wide environmental targets
・Set targets for achieving carbon neutrality by 2030
・Save energy and purchase renewable energy
・Set targets for a recycling rate
・Reduce energy consumption by productivity improvement
・Consider renewing with energy-saving equipment in compliancewith regulations
・Promote capital expenditure by introducing ICP

Progress of low-carbon
technologies

・Increase in sales of materials for electronic parts due to theincreased demand for EV
・Increase in sales of materials for fuel cell due to theincreased demand for fuel-cell vehicles
・Increase in sales of materials for hydrogen generation
devices due to the increased demand for hydrogen energy
・Increase in sales of carbon cloth prepregs and honeycomb
materials due to the increased demand for the weight
reduction of vehicles and aircrafts【1.5°
C】Large・Develop and promote sales of high heat-resistant FPC materials
for EV and high heat-dissipation/insulation adhesive sheets

Change in customer
reputation

・Increase in market share by receiving a high reputation inmarkets when environmental friendliness can be addressed【1.5°C】Large・Introduce our initiatives by externally delivering the Environmental Policy and issuing environmental reports
・Publicize initiatives for ESG, TCFD, and carbon neutrality

Change in investor
reputation

・Easiness to obtain investment and loan from ﬁnancial
institutions and investors when climate change-related
information is disclosed more than other companies【1.5°C】Large・Issue integrated reports

Increased severity of
extreme weather events

・Increase in sales of seawater desalination treatment devices 【1.5°C】Mediumdue to the impact of water stress【4°C】Large・Increase in demand for and sales of electronic devices due tolower human mobility

・Promote sales in the electronic materials ﬁeld and of ﬁlament
winding products

Assessment (small, medium, large): analyzing quantitatively and qualitatively, and assessing relative impacts.

36

ARISAWA INTEGRATED REPORT

Sustainability（E）
Promotion of Circular Economy
Emission Policy
In order to realize a sustainable society, it is required to make an early transition to an economic system with less environmental impact; itis required to break away from an economic system (linear economy) that uses a large amount of natural resources and fossil fuels, produc-es and consumes a large quantity of industrial products, and disposes of these products in mass quantities and to make a shift to a circular
economic system by treating as resources industrial products which are considered waste in the conventional economic system andcirculate those by recycling (Recycle), reusing (Reuse) and reducing (Reduce).

We have been working to reduce and reuse emissions and waste generated by our business activities through the activities. To

accelerate activities for reducing and reusing, we established the Emission Subcommittee within the Environmental Protection and Management Committee in FY2022.

Long Term Targets for the Emission Subcommittee[1] Reduce industrial waste emissions by 30% compared to FY2020 by 2050.
[2] Achieve the zero emissions of industrial waste related to development and manufacturing by 2050.

Toward these targets, we will continue to reduce waste and recycle industrial waste that is not currently recycled.

Outsourcing Disposal ofHazardous Industrial Waste
We outsource the disposal of industrial waste to disposal operators. In compliance with laws and regulations, such as the Act on
Waste Management and Public Cleansing, we properly issue anindustrial waste control documentation (manifest) and check theprocess up to the ﬁnal disposal destinations. We also conduct
on-site inspections (including document examinations) of
disposal operators as needed to conﬁrm that our emissions aredisposed of properly.

37

Green Purchasing
The green purchasing ratio was 87.4% in value terms.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Activity Results
Regarding the reduction of industrial waste emissions, we

As a result, we are now able to recycle glass waste, PVC

conduct monthly waste patrols in our factories to identify items

pipes and PVC cutting waste in FY2022. In addition, we areinvestigate whether any new materials are available for recycling,

waste liquid, separation of paper tubes with mouthpieces intothat may be subject to reduction. Regarding zero emissions, weand work toward a goal of achieving a recycling rate of 90% or
higher for a single year.

Industrial Waste and Recycling Rate
Industrial waste emissions were 1,643 tons. The breakdown of theemissions is 50% for waste plastic, 19% for waste oil, 11% for sludge,

considering recycling by the distilled separation of cleaning
steel and paper tubes, and compaction of plastic platelets.

Waste acid 4％
Other
9％

Wood chips 7％

7% for wood chips, 4% for waste acid, and 9% for other.

Waste plastic emissions were reduced by 0.4% from theprevious year.

In order to achieve the zero emissions of industrial waste related

Sludge 11％

to development and manufacturing by 2050, we are continuing topromote active recycling (thermal recycling or material recycling),
and the recycling rate in FY2022 was 97.1%.

Waste plastics
50％

Waste oil19％

Types and Ratio of Industrial Waste

Trends in Industrial Waste Emissions and Recycling Rates
Qty（tons）

（%）

4,000

100
80

3,000

60
2,000
40
1,000

0

20

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Industrial Waste Emissions

0

Recycling Rates

38

ARISAWA INTEGRATED REPORT

Sustainability（S）
Human Resource Management
Human Capital Management Policy
Human resources are the source of value creation and the driving

human resources.

group. With growing attention to diversity, collaboration, andtee within the ESG Committee.

environment and update human resource development plans toof activities aimed at building an organization suitable for execut-

and are eager to work in. To further enhance our corporate value,leaders, creating a better environment for employees in positions,force to achieve sustainable growth and development for ourhealth management, we will continue to improve a working
create workplaces that we can be proud of and feel comfortable
we are focusing on attracting and developing diverse humanresources, including creative and ﬂexible leaders and digital

Initiatives on Recruitment andEnsuring Diversity
Our basic policy in recruitment is to ensure diversity and achieveequal opportunity, and we attract a diverse range of new gradu-

ates for research and development positions, regardless ofregion and school.

The ﬁrst female director was appointed in June 2021, andtwo of the directors are female as of June 2023 through theimplementation of various development plans and efforts topromote the active participation of women. In addition, the ﬁrst

In FY2023, we established the Human Capital SubcommitThe Human Capital Subcommittee will work on a wide range

ing business strategies, such as improving the attractiveness of
examining a dynamic human resource portfolio, and relearning
skills that are lacking in the organization.

（％）
50

Trends in female employees
in managerial positions

40
30
20

20.0
12.5

10.6

FY2021(Results)

FY2022(Results)

100female operating ofﬁcer was appointed in June 2022 throughFY2024(Plan)

internal promotion.

We will furthermore aim to increase the ratio of women in

Trends in mid-career inmanagerial positions

management positions to 20% by the end of FY2024. Additional-

ly, in order to respond to environmental changes and take on new

business challenges speedily, we also place emphasis on the
mid-career hiring of professionals with advanced knowledge andexperience in specialized ﬁelds.

（％）
100
75

We believe that new ideas and solutions are created by

50

together and thinking about things from each perspective, which25

people with different backgrounds and experiences getting
will lead to an increased corporate value. We regard diversity as
an important management issue and will continue to promote it.

0

68.8

70.5

70.0

FY2021(Results)

FY2022(Results)

FY2024(Plan)

Human Resource Development
With regard to the human resource development, we aim towith a new employee development plan. Career consultation by a

improve organizational power by striving to provide a wide range

addition, we are working to develop and promote human resourc-

enhance job satisfaction for each and every employee andof opportunities for skill development, including improvement ofbasic skills with position-based trainings, external trainings, andself-development with e-learning.

New employees receive one-on-one guidance from anindividually assigned trainer and learn their tasks in accordance

39

career consultant or industrial counselor is also available. In
es and future leadership candidates who can think independently

and practice CIC, which is at the core of our management policy,

through communication, such as direct dialogue between
management and young employees in executive ofﬁcer courses.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Fair Evaluation and Treatment
We adhere to meritocracy regardless of age, gender, or career in

Ratio of gender wage gaps
between men and women

recruiting, promoting and appointing, and have introduced asystem to encourage the growth of employees through multidi-

（％）
100

mensional evaluation and feedback based on the management by
objectives (MBO).

We also aim to build a strong organization through salary75

job responsibilities. Examples of the incentive system for employ-

50

increases based on evaluations and an incentive system based on

ees include an employee stock ownership plan for employees in

77.6

80.5

FY2021(Results)

FY2022(Results)

85.0

25

management positions, the allocation of bonuses based on

performance evaluations, awards on Culture Day (awards to0

employees for long service, excellent work efﬁciency, and contri-

butions to improving the company's performance), and a reward

FY2024(Plan)

system for proposals that contribute to improved productivity.

Promotion of Work-life Balance
As an example, depending on a type of work, we have

As we value each employee's independence and creativity, andcoexistence and co-prosperity with the company and protect

adopted systems, such as ﬂextime, teleworking, and staggeredon ensuring a healthy work environment that respects humanchildcare leave and the percentage of annual paid leave taken are

working hours. As a result, the rate of male employees taking

workplace safety and physical and mental health, we are working

on the rise. We also support employee asset building throughrights and is free from discrimination. While giving ﬁrst priority toemployee shareholding associations and selective deﬁned contri-

ensuring human safety and health in all processes of our businessbution plans. It is a company's obligation to provide a comfortable

activities, we will respect the personality and individuality of eachwork environment for its employees, and this contributes to highand every employee, foster a free and open-minded corporate

employee retention rates by making it easier to maintain work-life

culture that respects diversity, and maintain a cheerful andbalance and improving operational efﬁciency.

rewarding work environment.

Ratio of male employees
taking childcare leave
（％）

（％）

100

60.0
42.1

75

25

25

0

0

FY2021(Results)

FY2022(Results)

10

57.2

65.6

75.0

50

29.4

FY2024(Plan)

Turnover ratio(non-consolidated)
（％）

100

75
50

Percentage of annual
paid leave taken

5

FY2021(Results)

FY2022(Results)

FY2024(Plan)

0

1.2

1.2

1.2

FY2020(Results)

FY2021(Results)

FY2022(Results)

Corporate Culture
We do not use titles that imply hierarchical relationships, such as
jyoushi (boss) or buka (subordinate), and encourage employees

to address each other by attaching the Japanese honoriﬁc san tonames. We believe that this will protect the health of our employ-ees, create a comfortable workplace, and eventually improve
productivity and encourage innovation, which result in increasing
corporate value.

40

ARISAWA INTEGRATED REPORT

Sustainability（S）
Occupational Health and Safety
Under the Safety Declaration and Our Action Guideline, all of our employees and the employees of our subcontractors
who work with us participate in promoting safety activities with the aim of achieving zero accidents.

1. We will aim to be a good company that places
safety ﬁrst, live up to the trust of our customers, and fulﬁll social responsibilities.
2.We will build a safe and comfortable workplacethrough a zero accident campaign in which all
employees participate, always keeping safety
awareness in mind.
3. We will not do or let anyone do risky behavior.
We will build a disciplined workplace that
follows standard work and rules.

Promotion System ofOccupational Health and Safety
At each workplace, group leaders carry out
decisions as a workplace safety and healthpromoter. A director and general manager acts
as a general occupational health and safety
manager, who reports on important matters toand is monitored and supervised by the Board of
Directors.
In addition, under the management policyof labor-management cooperation, we holdregular meetings with the union on occupational
health and safety and outsourcing safety
meetings to raise the safety awareness of all
employees.

Priority Goals of Occupational
Health and Safety for FY2022

Our Action Guideline

We give the highest priority to safety,
and fulﬁll our own roles andresponsibilities for zero accidents.

Board of Directors

Occupational Health and Safety Committee

Management
Committee

Chairperson(General Occupational
Health and Safety Manager)

Board of Operating
Ofﬁcers

Secretariat(General Affairs Dept.)

Vice-chairperson
Staff
Safety Manager
Health Manager

Committee Memberof Management

Committee Memberof Labor

Working Environment
Measurement Expert

Industrial Doctor

Labor Union Leader
Secretary-general
Executive Committee Member

Committee Memberof Management

Manager
Some Group Leaders
Workplace Occupational
Health and Safety Manager

Observer (some subsidiary companies)

Workplace Safety and Health Promoter

Occupational Health and Safety Initiatives
To achieve the goal of no accidents, we continue to engage in daily safety
activities, such as safety patrols, safety education and training, and occupational
health and safety risk assessments as well as report on near-miss (hiyari-hatto)
incidents at each workplace, hazard prediction training, 4S activities (4S stands for
Seiri, Seiton, Seisou, and Seiketsu, or Sorting, Setting-in-Order, Shining, andStandardizing), and rotational safety announcements.
In order to prevent accidents and disasters, it is important to ensure the safetyof manufacturing processes and the soundness of facilities and to continue stable
operations. At each factory, we make plans to inspect and renew facilities, prioritize
them according to risk and importance, and carry out inspections, repairs, andrenewals in sequence. In addition, we are proceeding with risk assessments when
installing facilities as a measure to prevent similar accidents from happening again,
besides conﬁrming the effectiveness of countermeasures using past accident cases.
As a response to emergencies, we have in place a disaster prevention system
for self-protection at each business facility and conduct various disaster prevention
drills in accordance with the annual plan in case an accident occurs. Speciﬁcally, we
conduct company-wide ﬁre drills, joint ﬁre drills with a ﬁre department, and company-wide earthquake drills (BCP activation drills).
We also maintain close contact with our domestic consolidated subsidiaries toshare information and apply safety and other measures to them.

41

1.Accidents are caused by habituation andcarelessness. Always go back to basics and do
standard work.
2. Give a warning immediately if you see
something unsafe. The words that are given
and the feelings that are wished for are zeroaccidents.
3.Safety greetings and pointing and calling are
carried out by all.

=

Safety Declaration

Safety frequency rate
1.5
1

1.20

0.984

0.5

1.20

1.21

1.31

1.25

0.964

0.508
0

0

0

2018
2019
2020
2021
2022
［ Frequency rate: (total number of casualties due to industrial accidents/ total number of actual working hours)×1,000,000 ］

Safety severity rate
0.15
0.1

0.100

0.100
0.070

0.05
0

0.060

0.080

0.060

0.005

0.001

0

2018

2019

2020

0
2021

2022

［ Severity rate: (total number of working days lost /total number of actual working hours) ×1,000 ］
Arisawa Group (domestic)

Average of domestic manufacturing industry

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Supply Chain Management
In 2022, we established the Procurement Subcommittee and announced the CSR Procurement Policy with the aim of procuring environmentally friendly products and services and building a supply chain free of social issues related to human rights,
health, ethics and so forth.
We will actively promote CSR activities in order to fulﬁll social responsibilities through business activities. Through those
activities, we will work to address a variety of issues and aim at sustainable growth in continuing our business activities.

CSR Procurement Policy
1. Establishing a Company Structure to Facilitate CSR(Corporate Social Responsibility)
・Develop management policies and action guidelines on CSR.
・Establish an organizational structure which promotes CSR.

2. Fair Trade
・Prohibit the offering and receiving of inappropriate proﬁts andadvantages.
・Conduct trading through fair and free competition.

3. Human Rights, Ethics, and Legal Compliance
・Prohibit human rights abuses (harassment, discrimination, abuse, andcorporal punishment) and respect human rights.
・Prohibit forced labor and overwork, and appropriately manage working
hours and days off.
・Have no relationships with anti-social forces (individuals and groups)
and do not engage in transactions with such forces.
・Identify and comply with laws, regulations and rules applicable tobusiness activities.

4. Ensuring Quality and Safety
・Establish and implement a quality management system, and promote
quality assurance activities.
・Comply with laws and ensure sufﬁcient product safety regarding
internally designed products.
・Identify risks, such as potential accidents, earthquakes, ﬁres and ﬂood
damage, and establish a safe working environment.

5. Environmental Consciousness
・Acquire a certiﬁcation, such as the one of Environmental Management
Systems (EMS), and promote environmental activities systematically.
・Comply with laws and regulations related to environmental protection
pertaining to air, water quality, soil, and chemical substance.
・Work on environmental load reduction in our business activities(biodiversity conservation, and resource saving and energy saving).
・Appropriately manage and dispose of waste generated in operations inaccordance with laws and regulations. Promote recycling and set a
continuous reduction goal.

6. Information Management and Contribution to Society
・Establish and appropriately manage an information security system.
・Take measures against internal and external threats, such as computervirus.
・Actively participate in social contribution activities.

7. Business Continuity Plans (BCP)・Establish BCP, and build and raise awareness about a risk management
system to prepare for unforeseen situations.
・Promote efforts to suppliers.

8. Responsible Mineral Procurement
・Prohibit and monitor the use of minerals which might serve as a sourceof funds for groups involved in internal conﬂicts and disputes.

Procurement Initiatives

Respect for Human Rights

Based on the CSR procurement policy, we started a supplier

The CSR questionnaire includes questions on the reporting

major existing suppliers to complete a survey once every ﬁveviolations, the consultation service, and the disciplinary policy

survey using a CSR check sheet in FY2022. We will ask ouryears, and new suppliers, in principle, to complete a survey
before starting business.

Of the approximately 300 suppliers of our raw materials,

we conducted a questionnaire survey of approximately 150

suppliers in FY2022, and received responses from approximately 90 companies. As a result of totalizing the self-diagnosis, there were 10 suppliers with scores below 70, and we are
getting alignment on items that require improvement.

In the future, we will establish a mechanism to regularly

conduct a cycle of investigation, diagnosis, risk assessment,

system for violations of basic human rights and legal and ethicaland procedure. In the FY2022 survey, there were no negative
responses regarding human rights due diligence, so we did not

request any measures to prevent, mitigate, or suspend such

issues. Furthermore, we believe that conducting surveys andinterviews with individual employees of the suppliers will be oneof our future tasks.

Regarding the working environment of the suppliers, we

conduct fact-ﬁnding surveys on the production environment at
the time of quality audits.

and follow-up.

42

ARISAWA INTEGRATED REPORT

Sustainability（S）
Quality Improvement Initiatives
Quality Policy
Under our quality policy Arisawa pledges to supply the high quality product that meets the reliability and needs of thecustomer by standing in the customer's viewpoint, we will implement the following activity guidelines. We believe that for acompany to survive and develop sustainably, it is absolutely necessary to comply with laws and regulations and provide
products of the quality that customers expect. In order to ensure thorough quality compliance, we will promote measures,such as enhancing education and strengthening quality fraud checking functions.

Activity Guidelines

1．We will regularly review our quality management system and continually improve its effectiveness in order to meet the requirements of ISO 9001/JIS Q 9100.
2．We will monitor our manufacturing processes and strengthen control through our quality management system to ensure thatthe products we provide meet the needs of our customers and society and increase customer satisfaction.
3．We will set the following quality targets and do our best in order to achieve the quality policy.
（1）Reduction of complaints that are caused by the company（3）Proper operation and management of measuring instruments（2）Reduction of internal percent defective

4．We will set quality targets on a yearly basis and review them as necessary.
5．We will conduct internal audits to conﬁrm the effectiveness of our quality management system, and strive to maintain andimprove it.
6．We will provide education and training to all employees to ensure that they are fully aware of our quality policy in order toeffectively utilize our quality management system.

Quality Control System
We have acquired ISO 9001 (target sites: Arisawa
Mfg. Co. and Arisawa Fiberglass) and JIS Q 9100

Board of Directors

Quality Control Committee
Chairperson

Management
Committee（Operating Ofﬁcer supervising
Quality Assurance Dept.）

will work to improve the quality of our products andBoard of Operating
Ofﬁcers

Vice-chairperson(Quality Control Manager)

quality assurance system we have established, we
services.

In addition to the Company-wide Quality

Control Committee (once a year), Factory Quality
Control Committee (once a year), and Line Quality
Committee (twice a year), which are held regularly,=(target products: aircraft materials). Based on the

Secretariat（Quality Assurance Dept.）

Quality Assurance Dept. Manager
Committee
Memberthe Individual Quality Control Committee deliberates
individual cases.

Manufacturing Dept.
→ Operating Ofﬁcer in charge, Manager,
Group Leader
Engineering Dept., Manufacturing Engineering
Dept., Information System, Sales & Marketing
Dept., Quality Assurance Dept.
→ Group Leader

The structure of the Company-wide Quality

Control Committee is shown in the ﬁgure on the right.

Quality Control Initiatives
In the mass production of new products, the Quality Assurance

In order to incorporate customer needs and improve customer

design and development stages, conducting risk assessments andand complaints from stakeholders in each process. This cycle

Department and other related departments are involved from theaccompanying process risk patrols prior to the transfer of
production. For existing products, the Quality Assurance Depart-

ment and the Manufacturing Department jointly conduct thequality patrols of each process to identify potential risks andthereby prevent complaints.

43

satisfaction, we make improvements by reﬂecting evaluations
enables us to improve our quality management system. Addition-

ally, in order to maintain and improve the quality management

system, we conduct internal audits twice a year to check theoperational status.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Targets and Results of Initiatives for FY2022(1) Zero complaints that are caused by the company
Percent defective

Number of complaints

By identifying potential risks and taking countermeasures with(Complaints)（％）

the use of FMEA and risk assessment, we not only reduce the risk

15

1.5

of complaints, but also strive to raise the quality awareness of11each and every employee and reduce human errors, such as

10careless mistakes, through quality education. In addition tocomplaints, we also took seriously and examined carefully the
points raised by our customers and worked to correct them andprevent their recurrence in the same way as complaints.

0.95

10

1.0
6
4

5

0

2018

2019

5

2020 2021 2022

0.83

0.96
0.71
0.50

0.5

0

2018 2019 2020 2021 2022

(2) Reduction of Internal Percent Defective(3) Collaboration with Suppliers

Each manufacturing group set targets for major products andWe regularly evaluate suppliers for quality-related nonconformi-interviews during the process patrols, we identiﬁed quality risks

audits as necessary. We also hold regular quality meetings withbottom up, and prevented defects from occurring.

important products to share customer and company require-(4) Customer Satisfaction Survey(5) Proper Operation and Management of Measuring Instruments

We conduct customer satisfaction surveys twice a year to checkWe keep our measuring instruments in proper condition at all

ules and so forth, and are working to improve customer satisfac-

operation of the instrument management system.

worked to reduce percent defective. Speciﬁcally, throughties and their responses on a regular basis and conduct supplierthat operators and inspectors perceived on a daily basis from thethe suppliers of major raw materials and raw materials used inrequirements for us regarding technical support, delivery schedtion from various aspects.

(6) Management and Promotion of Quality Plans
・We achieved 100% of the quality targets of each department for
FY2022.

・We passed the initial audit that integrated ISO 9001 and 14001.

ments, and are promoting quality improvement initiatives.

times by sounding an alarm at each calibration cycle through the(7) Quality Education
We conduct general education every year to disseminate company-wide and group-wide quality targets. Additionally, we conduct
education to provide products with higher quality

aimed atThis has led to reductions in the number of man-hours and costs

fostering quality awareness among all employees in the Manufac-

・Standards are kept up-to-date and can be viewed by eachproduct prevention training in departments subject to JIS Q

required for auditing.

department through the document management system.

turing Department, as well as product safety and counterfeit
9100.

We strive to improve and strengthen our quality management system through close exchange of opinions with stakeholders, and by promoting employee education, we aim to instill in all employees an awareness of emphasizing quality from the perspective of stakeholders.

44

ARISAWA INTEGRATED REPORT

Sustainability（G）
Corporate Governance
Basic Concept of Corporate Governancedecisions of the Board of Directors, where outside directors andWe have a corporate governance system in place to increase

outside corporate auditors attend.

corporate value through sustainable growth and to maintainIn terms of equitable management, in line with the basicsocial credibility and is also making efforts to secure efﬁcient andequitable management and to enhance management transparency

policy concerning the improvement of the internal control system,

In terms of management efﬁciency, to ensure expeditious

ing legal compliance. In order to enhance transparency, we

we improve organizations and systems for the purpose of ensur-

through proactive disclosure.

promote communication with our shareholders and generaldecision making, we aim at management by a selected few andinvestors through IR activities, etc. and conduct disclosure

restrict the number of directors to the requisite minimum. We also

practices as actively and promptly as possible.

employ the operating ofﬁcer system to ensure speedy executionof operations and collect highly accurate information under the

Changes in Enhancement of Corporate Governance System
Although we are a company with a board of company auditors, we have in place the Assignment and Remuneration Advisory Committee,
which is voluntary, that deliberates matters related to the appointment and dismissal of directors, appointment and removal of representa-

tive directors and directors responsible for business execution, succession plan and director remuneration, and reports to the Board of
Directors.

The company's Board of Directors currently consists of four internal directors and ﬁve outside directors (including two female

directors) for a total of nine directors. The evaluation of the effectiveness of the Board of Directors are conducted by a third-party organization to ensure fairness.

FY

45

Items

InsideOutside

Male

Male

Operating Ofﬁcers

Board of Corporate Auditors

Board of Directors

FemaleInsideOutsideInsideOutside

Male

Male

Male

FemaleServed as
directors

2015

・Issuance of corporate governance report

5

2

1

2

11

5

2016

・Self-assessment of the effectiveness of theboard of directors

5

2

1

2

11

5

2017

5

2

1

2

11

5

2018

5

2

1

2

11

5

2019

・Non-renewal of the anti-takeover measures
・Establishment of the Assignment and Remuneration
Advisory Committee (voluntary advisory body)

4

2

1

2

11

4

2020

・Assessment of the effectiveness of the Board of
Directors by a third party organization
・Introduction of exercising voting rights by anelectromagnetic method

4

3

1

2

11

4

2021

・Change of stock-based compensation for directors
from stock options to restricted stocks

4

4

1

1

2

11

4

2022

4

4

1

1

2

11

1

4

2023

4

3

2

1

2

10

1

4

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Outline of Corporate Governance System
As for execution of operations, to ensure speedy execution andother organizations of the company and conducts scheduled

determined at the regular or extraordinary meetings of the Board

audits, an audit plan is made for each term pursuant to theaudits and special audits as appropriate. As for the scheduled

control of the management policy and management plansrelevant internal regulations, and audits are conducted after theof Directors, the Board of Operating Ofﬁcers (comprising 1 chief

ﬁnal decision by the chief executive ofﬁcer. Audit results are

executive ofﬁcer and 10 operating ofﬁcers for a total of 11

notiﬁed to the relevant departments along with speciﬁc advice

members) is in place in pursuit of management proactively andand recommendations, while reporting to, and opinion exchanges

accurately.

with, the corporate auditors are also made.

Each operating ofﬁcer plans and promotes operations

The certiﬁed public accountants who conduct the account-under his or her supervision upon approval at the Board of

Directors or extraordinary meetings of the Board of Directors as

ing audit of the company are two members of Ernst & Younglished in FY2023 to deliberate and coordinate basic management

accounting audit work of the company is determined in accor-

ShinNihon LLC, and the composition of assistants involved in thewell as the regular meeting of Management Committee (estab-dance with the selection standards of the audit corporation andpolicies based on decisions of the Board of Directors, otherspeciﬁcally includes 11 certiﬁed public accountants and 8

important matters related to management, and to conduct prelimi-

others.

nary deliberations on matters to be discussed at the Board of

The results of auditing by the internal audit division and the

Directors meetings) or the Board of Operating Ofﬁcers andstrives for efﬁcient and speedy execution of their duties pursu-

details of accounting audits by the accounting auditors are

Authority, etc.

auditors share in the recognition of such results in the course ofreported to the Board of Corporate Auditors, and the corporate

ant to the Regulations for the Segregation of Duties and Ofﬁcial

their auditing to enhance their collective audit function.

As an internal audit division, three full-time employees are

assigned to the Internal Auditting Ofﬁce, which is independent ofGeneral Meeting of Shareholders
Appointment & Dismissal
Advisory
Assignment・Remuneration
Advisory Committee（CEO and 5 Outside Directors） Return
Appointment & Dismissal

Board of Directors
9 Directors(incl. 5 Outside Directors)

Appointment, Dismissal,
Directions & Supervision

Operating Ofﬁcers

Directions &Supervision

Appointment & Dismissal

Audit

Appointment & Dismissal

Board of Corporate Auditors
3 Corporate Auditor(incl. 2 Outside Corporate Auditor)

Accounting Audit

Collaboration

Submit・Report
ReportPresident andRepresentative Director

Management Committee*

Accounting Auditors(Ernst & Young ShinNihon LLC)

Internal Auditing Ofﬁce
Directions

Board of Operating Ofﬁcers**

Compliance Committee
ESG Committee, etc.

Internal Audit

Each division, department, subsidiary, etc.

＊The Management Committee is comprised of ﬁve operating ofﬁcers at the senior level or above, including the CEO, and was established on April 1, 2023.
＊＊Note: The Board of Operating Ofﬁcers consists of a total of 11 operating ofﬁcers (including, but not limited to, the chief executive ofﬁcer), 4 of which are concurrently assumed by the relevant directors.

Number of meetings held and main agenda items in FY2022
Board of Directors

Board of Operating Ofﬁcers

Assignment・Remuneration Advisory Committee

Board of Corporate Auditors

Chairperson

CEO

CEO

Outside Director

Full-time Corporate Auditor

AttendeeDirector (including outside directors),
Corporate Auditor(including outside directors)

Operating Ofﬁcers,
Corporate Auditor (full-time only)

CEO and Outside Director

Outside Corporate Auditor

The Number of Meetings

9times15times

3times9timesDeliberation
Items

Quarterly
ﬁnancial
resultsandperformance
forecasts,
annualmanagement strategy, medium-termbusiness plan, governance, general
meetings of shareholders, etc.

Quarterly
ﬁnancial
resultsandperformance
forecasts,
capitalinvestments,
annualmanagement
strategy, monthly business reports, etc.

Appointment and dismissal of directors,
Remuneration of directors, etc.

Advice to internal audits, validation of
accounting audit results, etc.

46

ARISAWA INTEGRATED REPORT

Sustainability（G）
Board of Directors
Approach to the Board of Directors Diversity
The company's basic approach is to have the Board of Directors

operation. Regarding diversity, we have appointed multiple

insight, and a high level of expertise, within the limits of 15

business and who have experience as managers at other compa-

directors who have extensive experience in international

composed of individuals with a wealth of experience, deepnies. The composition also takes gender and age into consider-directors and 4 corporate auditors set forth in the Articles ofation.

Incorporation, while taking into consideration their balance ofknowledge, experience, and abilities related to each business andSkill Matrix
In the medium-term business plan, we set the goal of aiming togies to improve capital efﬁciency by converting non-businessstrategies and ﬁnancial strategies. We will pursue the business

The Board of Directors is comprised of individuals with the skills

assets into business assets and returning proﬁts to shareholders.

maximize corporate value by executing a cycle of businessand insight necessary to achieve these goals.

strategies to strengthen proﬁtability by delving into existing
businesses and creating new businesses and the ﬁnancial strate-

Name
Representative Director

Yuta Arisawa
Director

Corporate
Management○

Takeshi Masuda
Director

Osamu Nakajima
Director

Makoto Tai
Outside Director

Koji Nakamura
Outside Director

Kazuo Abiko

Outside Director

Hirotoshi Takada
Outside Director

Miho Numata
Outside Director

○
○
○
○

Businessstrategy /marketing○R&D/
technologicalstrategies○○○

Corporate Auditor

Outside Corporate Auditor

Koichiro Tanaka

Outside Corporate Auditor

Koichi Yokota

○
○

○
○

○
○

○

○

○

○

Makiko Horie
Hisashi Masumura○

Finance /HR / labor /Legal /
accounting /HR development risk managementﬁnancial market

○
○
○
○

○

○

○

○

International
experience

○
○
○
○
○
○
○

Policy on Appointment and Dismissal of Directors
In nominating candidates for executive managers and directors

cases is applicable: (1) a relationship with antisocial forces isfor executive managers or directors or corporate auditors in theviolated, causing a signiﬁcant loss to our group, (3) the execu-

experience, deep insight, and a high level of expertise, suitablecompany. The Board of Directors determines the nomination ofcandidates for directors based on the report of the Assignment
and Remuneration Advisory Committee, and candidates forcorporate auditors by getting consent of the Board of Corporate
Auditors.

47

Dismissal will occur in the event that any of the following

and corporate auditors, we select those who have extensive

found, (2) laws, regulations, or articles of incorporation aretion of duties is signiﬁcantly impeded, or (4) it becomes clearthat the requirements of the appointment criteria are not met. In
that case, after deliberation by the Board of Directors, a decision

is made to dismiss a position or to submit a proposal for dismissal
to the general meeting of shareholders.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Outside Directors
A majority of ﬁve members out of the nine directors is indepen-

information on economic conditions, industry trends, relevant

and the Board of Directors is engaged in constructive discus-ing, and other matters necessary for them to fulﬁll their roles anddent outside directors as deﬁned by the Tokyo Stock Exchangesions, including their objective opinions from an independent

standpoint. The outside directors, who have a wealth of experi-laws and regulations, corporate governance, ﬁnancial accountresponsibilities.

Speciﬁcally, we arrange seminars for outside directors

ence and a wide range of insight, also provide advice and recom-

provided by external organizations, where our operating ofﬁcers

Board of Directors' decision-making.

strategies, the status of various businesses, business environ-mendations to ensure the appropriateness and legitimacy of theOn the other hand, we support outside directors in theperformance of their duties by collecting and providing them within charge regularly provide explanations on business plans andment, and management issues, while arranging inspection tours of
product manufacturing processes.

Name

Reasons for Appointment and Expected Role

Attendance
Rate

Koji Nakamura

Koji Nakamura, an Outside Director, has been involved in corporate management in Japan and overseas for many
years, having served as Senior Executive Managing Ofﬁcer of Mitsui & Co., Ltd. and as Director at Sanko Gosei Ltd.
The Company has appointed him because we deem that he has extensive insight and knowledge regarding global
management from his experience as a managing ofﬁcer at a global company and that he will deliver opinions from an
outside perspective with regard to the overall management of the Company, particularly in the area of businessstrategy, and increase the rationality and transparency of the Company s management.

100%

Kazuo Abiko

After graduating from Graduate School of the California State University, Kazuo Abiko, an Outside Director, wasappointed the General Manager of Tokyo Studio and General Manager for Northeast Asia at Associated Press while also
working as the President of Foreign Correspondents Club of Japan. The Company has appointed him because we deemthat he will deliver opinions from an outside perspective and increase the rationality and transparency of the Company s
management by leveraging his knowledge in international communication and standards and ethics of journalism,
including his work as a part-time lecturer at Tokyo University of Foreign Studies and Sophia University thereafter

100%

Hirotoshi Takada

Hirotoshi Takada, an Outside Director, has served the Representative Director of NIPPON SEIKI CO., LTD. and as
Chairman, etc. of overseas subsidiaries, has been engaged over many years in sales and product planning, etc. in theautomobile industry; has a deep knowledge of that industry. The Company has appointed him because we deem that hewill deliver opinions from an outside perspective and increase the rationality and transparency of the Company byleveraging his abundant experience and broad knowledge as a manager of a company in the manufacturing industry
with a global business.

100%

Miho Numata

Miho Numata, an Outside Director, is Representative of NUMATA LAW OFFICE, and by serving as Civil Conciliation
Commissioner of Tokyo Summary Court and as Outside Corporate Auditor of Tokyo Boeki Holdings Corporation, while
managing the law ofﬁce, she has a well-balanced career. The Company has appointed him because we deem that she
will deliver opinions from an outside perspective and increase the rationality and transparency of the Company by using
her in-depth knowledge and experience as a legal expert who has worked as an attorney at law for many years, and her
sophisticated knowledge relating to governance and compliance, etc.

100%

Makiko Horie

Makiko Horie, an Outside Director, was engaged in sales to institutional investors, company surveys, and operation
related to the Japanese stock market at a global ﬁnancial institution, and also involved in management consultation andlaunching of start-ups. The Company has appointed her because we deem that she can reﬂect on management
strategies the status of the Company that investors expect by leveraging her experience and increase the rationality
and transparency of the Company.

Newly
Appointed

Evaluation of the Effectiveness of the Board of Directors
We analyze and evaluate the effectiveness of the Board ofities, and that free and open and constructive discussions arecorporate auditors with the aim of improving the functioning ofdecision-making and supervision related to business execution.

Directors based on a questionnaire survey to all directors andthe Board of Directors. The survey is conducted on the condition

held

at

meetings,

ensuringtheeffectiveness

of

both

On the other hand, as the role of subsidiaries in consolidat-of anonymity in order to elicit unreserved opinions from theed ﬁnancial results increases in importance, it has been pointed

and analysis of the results are outsourced to an external organi-subsidiary management and that training for directors andsubjects. The implementation of the survey and the tabulation

zation, and the Board of Directors deliberates based on the reportto address issues.

The results of the survey conducted this spring determinedthat the company's Board of Directors has a composition with thebalance and diversity necessary to fulﬁll its roles and responsibil-

out that further efforts are needed in discussions regarding
auditors needs to be further enhanced, and the Board of

Directors shared the recognition of those points. We will continue
to work on issues identiﬁed by these analyses and evaluations
and aim for increasing our corporate value.

48

ARISAWA INTEGRATED REPORT

Sustainability（G）
Board of Directors
Policy of Determination on Amount of Remuneration,etc. of Directors and Corporate Auditors
We have in place the Assignment and Remuneration Advisory Committee consisting of ﬁve outside directors and the president
for a total of six members and chaired by an independent outside director as an advisory body to the Board of Directors in orderto improve the independence, objectivity and transparency of the procedures for determining the remuneration of directors
and to enhance corporate governance. A calculation method of the details of individual remuneration for directors is determined at the Board of Directors based on deliberations and reports by the Assignment and Remuneration Advisory Committee.
Basic Guidelines for Remuneration System for Directors

Matters Concerning Determination of Remuneration for Directors

・The system should encourage the management to improve their

The Assignment and Remuneration Advisory Committee isremuneration and to exercise their solid entrepreneurship for

Board of Directors. The details of the consultation include basic

performancethroughassociating

theperformancewithsustainable development of the company.

・The system should reﬂect not only ﬁnancial performance but
also appreciation for proactive initiative with the basic spirit ofCreation, Innovation and Challenge.

・The system should attract excellent human resources for
management who can contribute to sustainable development

consulted on individual remuneration based on a resolution by the

remuneration amounts for each director and the evaluation
allocation based on the performance of a division of which eachdirector is in charge in the performance-based remuneration. The

Board of Directors determines each remuneration pursuant to thereport of the Assignment and Remuneration Advisory Committee.

and enhancement of corporate value of the company.

Remuneration Structure

Veriﬁcation of Validity of Remuneration

In the case of 100% achievement of KPI, the ratio of remunera-

The Assignment and Remuneration Advisory Committee conﬁrms

tion to executive directors is as follows.
Basic remuneration

50%

Performance-based
remuneration

30%

Stock-based
compensation

20%

Stock-based remuneration is provided in the form of restricted stock-based remuneration(programmed to lift restrictions of transfer upon retirement)
for the purpose of sharing interests with shareholders.

Outside directors are paid only basic remuneration in consideration of their role of supervisory function that they play.

accordance with the policy for determination on the remunerationof directors, veriﬁes its validity, and submits reports to the Boardof Directors.

The Assignment and Remuneration Advisory Committee

uses an objective and multifaceted benchmark analysis of
remuneration based on

Management Remuneration Databaserun by an outside remuneration consultant, Willis Towers Watson(WTW), to verify the validity of the individual remuneration of
directors.

Details and Reasons for Selection of the Key Performance
Indicators (KPI) for Performance-Based Remuneration

Remuneration of Corporate Auditors, etc.

Consolidated operating proﬁt for the single ﬁscal year has been

The company's basic policy is to pay an appropriate level ofmance-based remuneration. The reasons for selecting suchhis or her duties.

adopted as the Key Performance Indicators for perforIndicators is that i) they are a ﬁnancial indicator which represents

remuneration to each corporate auditor for the performance of

The remuneration for corporate auditors is determined

the result of primary business activities of companies, ii) they use

through discussions among the corporate auditors, taking into

ROIC which is a target ﬁgure to be achieved of the medium-term

division of audit work. The remuneration for corporate auditors is

net operating proﬁt less adjusted taxes (NOPLAT) to calculate
business plan, and iii) they are a ﬁnancial index used in the bonus
system for employees.

Out of amount of carbon dioxide emission reduction held up

in our Carbon Neutral Project, the company added goal attainment levels with respect to reduced usage resulted from improv-

ing energy use efﬁciency to the Performance Indicators fromFY2022, and reﬂected them in remuneration from July 2023.

49

that the individual remuneration of directors is calculated inconsideration whether they work full-time or part-time and theﬁxed remuneration only, which is paid on a monthly basis, with anemphasis on strengthening their independence from management.

About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

The aggregate amount of remuneration, etc. of each category of directors and corporate auditors,
the breakdown of such aggregate amount by the type of remuneration,etc. and the number of directors and corporate auditors covered

Category of directors andcorporate auditors

Aggregate amountof remuneration,etc.

Directors(excluding outside directors)

Number of directors
or corporate
auditors covered

Breakdown by the type of remuneration, etc.
Performance-based
Fixed remuneration
remuneration

Monetary
remuneration, etc.

203.51million yen

106.50million yen

60.26million yen

36.74million yen

4

Corporate Auditors(excluding outside corporate auditors)

13.08million yen

ー

ー

ー

2

Outside directors andoutside corporate auditors

31.00million yen

ー

ー

ー

7

Cross-shareholdings
Method of Verifying the Reasonableness of Shareholding

Reduction of Cross-shareholdings

Regarding all cross-shareholdings held, the Board of Directors

Regarding cross-shareholdings, the company passed a resolutionof transaction performances and returns, etc., qualitativesell off and reduce the stock names with a reduced need to be

yearly gives comprehensive consideration to quantitative analysis

analysis of status of business, business strategies, background of

acquisition, etc., as well as risk of shareholding, and then veriﬁes

at the Board of Directors held on May 12, 2022 to progressively
held to maintain business relations.

Speciﬁcally, at the ﬁscal year ended on March 31, 2022,

and evaluates the propriety of such shareholding.

the company sold off some shares of eight names out of nine held

analysis:

to hold the stock names and sell off and reduce the names with a

Following items are veriﬁed through the quantitativeat the end of March 2022. We will continue to scrutinize the need
reduced need to be held.

1

2

3

Balance of dividend
earning rate andcapital cost

Annual amount oftransaction andamount of proﬁts

Proﬁt or loss fromvaluation of stock

Trends in Cross-shareholding(Number of stock names)(Billions of yen）

40

30

20
16

17

16

16

15
12

20

10

0

36.1
26.9

27.9

26.8
18.4

2016

2017

2018

2019

Amount shown on balance sheets (current market price)

2020

9

9
7

25.6
17.6

2021

10

2022

5
10.2
2023

0

Number of stock names

50

ARISAWA INTEGRATED REPORT

Sustainability（G）
Directors and Ofﬁcers
Directors

Director
Senior Operating Ofﬁcer
supervising Electronic Materials
Sales & Marketing Dept.;Div. Chief,Business Promotion Div.;
Deputy Div. Chief,
Innovation Promotion Div.

Director
Senior Managing Operating
Ofﬁcer supervising
Manufacturing Dept.
and Administration Dept.

President andRepresentative Director
CEO

Yuta ARISAWA

Takeshi MASUDA

Osamu NAKAJIMA

CAREER HISTORYCAREER HISTORYCAREER HISTORY

Apr. 1992 Joined Mitsubishi Electric Corporation

Oct. 1990 Joined the Company

Apr. 1989 Joined Mitsui & Co., Ltd.

Feb. 2002 Joined JPMorgan Securities Japan Co., Ltd.

Nov. 2003 Group Leader, Administration Planning GroupMay 2011 Department Manager, Solar Business Div., Functional Chemicals

Aug. 2003 Joined the Company

Jul. 2008 Assistant General Manager, Manufacturing Dept.

Apr. 2007 Assistant General Manager, Manufacturing Dept.

Oct. 2010 General Manager, Corporate Planning Dept.

Apr. 2009 Operating Ofﬁcer of the Company

Jun. 2011 Operating Ofﬁcer of the Company supervising Corporate Planning Dept.

Jun. 2010 Director and Senior Operating Ofﬁcer of the Company

Jun. 2015 Operating Ofﬁcer

Jun. 2011 Director and Senior Managing Operating Ofﬁcer of the Company

Jun. 2021 Director and Senior Operating Ofﬁcer of the Company

Jun. 2014 President, Representative Director of the Company (current)

Jun. 2023 Director and Senior Managing Operating Ofﬁcer of the Company (current)

Business Unit of Mitsui & Co., Ltd.
Apr. 2013 Department Manager, Advanced Materials Div., Functional
Chemicals Business Unit of Mitsui & Co., Ltd.
Jul. 2014 Department Manager, Business Development Div., Basic Chemicals

Jun. 2015 Chief Operating Ofﬁcer (COO) of the Company

Business Unit of Mitsui & Co., Ltd.
Oct. 2015 Joined the Company as Operating Ofﬁcer of the Company
supervising Electronic Materials Sales & Marketing Dept.

Jun. 2017 Chief Executive Ofﬁcer (CEO) of the Company (current)

Jun. 2016 Director and Senior Operating Ofﬁcer of the Company (current)

Director
Senior Operating Ofﬁcer
supervising Development
Support Dept.and Innovation Center
Preparatory Ofﬁce;Div. Chief,
Innovation Promotion Div.;
Deputy Div. Chief,Business Promotion Div.
supervising Analysis Center

Outside Directors

Outside Directors

Koji NAKAMURA

Kazuo ABIKO

Makoto TAI
CAREER HISTORYCAREER HISTORYCAREER HISTORY

Apr. 1988 Joined Daiichi Denko Co., Ltd.(currently Sumitomo Electric

Apr. 1973 Joined Mitsui & Co., Ltd.

Nov. 1978 Joined Associated Press

Apr. 2004 Managing Ofﬁcer; Chief Operating Ofﬁcer of Synthetic Resins and

May 1985 Deputy General Manager of Tokyo Studio

Wintec, Inc.)
Jul. 2006 Group Leader, Electronic Materials Group, Research &Apr. 2006 Executive Managing Ofﬁcer; Chief Operating Ofﬁcer of Chemicals
Business Unit II

Development Dept.
Apr. 2010 Assistant General Manager, Electronic Materials Dept.
Apr. 2012 General Manager, Research & Development Dept.

Apr. 2004 General Manager of Tokyo Bureau, Associated Press
Jul. 2004 General Manager for Northeast Asia

Apr. 2009 Senior Executive Managing Ofﬁcer; Chief Operating Ofﬁcer of
EMEA (Europe, the Middle East and Africa) Business Unit

Feb. 2010 Advisor
Sep. 2010 Part-time lecturer at Tokyo University of Foreign Studies

Mar. 2011 Retired as Senior Executive Managing Ofﬁcer

Sep. 2011 Part-time lecturer at Sophia University

Aug. 2011 Corporate Auditor, SANKO Co., Ltd. (current)

Apr. 2015 Visiting Professor at Kanda University of International Studies

Jun. 2019 Operating Ofﬁcer

Aug. 2016 Outside Director, Sanko Gosei Ltd. (current)

Jul. 2018 Auditor, Foreign Correspondents Club of Japan

Jun. 2023 Director and Senior Operating Ofﬁcer of the Company (current)

Jun. 2020 Director of the Company (current)

Jun. 2020 Director of the Company (current)

Jun. 2015 Operating Ofﬁcer of the Company supervising Electronic Materials
Research & Development Dept.

Outside Directors

Outside Directors

Outside Directors

Hirotoshi TAKADA

Miho NUMATA

Makiko HORIE

CAREER HISTORYCAREER HISTORYCAREER HISTORY

Mar. 1977 Joined NIPPON SEIKI CO., LTD.

Dec. 2009 Registered as an attorney at law and joined NUMATA LAW OFFICE

Apr. 1990 Joined Nomura Securities Co., Ltd.

Apr. 2003 Director and President, UK-NSI Co., Ltd.

Jun. 2016 Representative (current)

May 1995 Joined Merrill Lynch Investment Managers Ltd. (currently

Jun. 2005 Director, NIPPON SEIKI CO., LTD.

Apr. 2018 Civil Conciliation Commissioner, Tokyo Summary Court (current)

Jun. 2008 Managing Director

Jun. 2020 Outside Corporate Auditor, Tokyo Boeki Holdings Corporation (current)

May 2016 Joined Value Create Inc.; Partner

Apr. 2011 Representative Senior Managing Director

Jun. 2021 Director of the Company (current)

Oct. 2021 Joined SDG Impact Japan Inc.; Partner (current)

Apr. 2011 General Manager, Technical divisionJun. 2011 Chairman, Wuhan Nissei Display System Co., Ltd.
Mar. 2012 Chairman, Nissei Display Sales and Development Co., Ltd. (Shanghai)Mar. 2013 President and Representative Director, NIPPON SEIKI CO., LTD.
Mar. 2014 Chairman, Dongguan Nissei Electronics Co., Ltd.
Apr. 2014 Chairman, Hong Kong Nippon Seiki Co., Ltd.
Jun. 2015 President and Representative Director, Executive Ofﬁcer, NIPPONSEIKI CO., LTD.
Jul. 2015 Chairman, Hong Kong Ek Chor Nissei Co., Ltd.
Jul. 2015 Chairman, Shanghai Nissei Display System Co., Ltd.
Mar. 2016 Chairman and Director, Thai Nippon Seiki Co., Ltd.
Jun. 2017 Vice Chairman and Director, Executive Ofﬁcer, NIPPON SEIKI CO., LTD.
Jun. 2021 Director of the Company (current)

51

Jul. 2001 President, Foreign Correspondents' Club of Japan

Inorganic Chemicals Business Unit

Mar. 2002 Joined the Company

BlackRock Japan Company, Ltd.)

Jun. 2023 Director of the Company (current)About Arisawa

Value Creation

Management Policy

Sustainability

Company Overview

Corporate Auditor

Full-time Corporate Auditor

Outside Corporate Auditor

Outside Corporate Auditor

Hisashi MASUMURA

Koichiro TANAKA

Koichi YOKOTA

CAREER HISTORYCAREER HISTORYCAREER HISTORY

Nov. 1987 Joined the Company

Oct. 1987 Joined Tohmatsu Aoki & Sanwa (presently Deloitte Touche

Nov. 1996 Registered as Certiﬁed Public Tax Accountant

Jul. 2005 Group Leader, Human Resources Group, Human Resources Dept.

Apr. 2003 Director, Takada Branch of Kanto-Shinetsu Certiﬁed Public Tax

Tohmatsu LLC)

Jul. 2008 Group Leader, Administration Planning Group, Corporate Planning Dept.

Mar. 1991 Registered as Certiﬁed Public Accountant

Oct. 2010 Assistant General Manager, Manufacturing Dept.

Aug. 1998 Resident Representative of Dalian Ofﬁce, U.S. Deloitte Touche

Apr. 2012 General Manager of Human Resources Dept.

Sep. 2002 Managing Director of the Japanese Operations Dept. in South

Oct. 2020 General Manager, General Affairs Dept.
Jun. 2022 Full-time Corporate Auditor of the Company (current)

Apr. 2019 General Manager, Takada Branch of Kanto-Shinetsu Certiﬁed

Tohmatsu (Ofﬁce Head)

Apr. 2018 General Manager of Human Resources Dept. and General Affairs Dept.

Accountant s Association
Jan. 2004 Head, Yokota Accountant Ofﬁce (current)

China of Shenzhen Ofﬁce in China, Deloitte Touche Tohmatsu Limited
Dec. 2003 Director and Executive Ofﬁcer; Partner supervising China Business and in

Public Tax Accountant s Association
Jun. 2020 Corporate Auditor of the Company (current)
Apr. 2021 Managing Director, Niigata Prefecture Branch Federation of

charge of Public Communication, Corporate Finance Dept. of Deloitte

Kanto-Shinetsu Certiﬁed Public Tax Accountant s Association (current)

Touche Tohmatsu (presently Deloitte Tohmatsu Financial Advisory LLC)
Jun. 2014 Retired from Deloitte Touche Tohmatsu LLC
Jul. 2014 Established Tanaka Sogo Accountant Ofﬁce, Representative
Director (current)
Mar. 2017 Outside Corporate Auditor, ODAWARA ENGINEERING CO., LTD. (current)
Jun. 2018 Auditor, Japan Automobile Research Institute (current)
Jun. 2020 Corporate Auditor of the Company (current)

Operating Ofﬁcer (excluding those serving concurrently as directors)
Shuichi FUJITA

Yoshifumi ARA

Takeshi AIZAWA

Senior Operating Ofﬁcer supervising
Performance Materials Sales &Marketing Dept.; Deputy Division
Chief, Business Promotion Div.

Operating Ofﬁcer supervising
Procurement Dept.
and Quality Assurance Dept.;
Deputy Division Chief,
Administration Div.

Operating Ofﬁcer supervising
Functional Films Development Dept.,
Laminate Materials Development Dept.,
Molding Materials Development Dept.
and Process Technology Dept.;
Deputy Division Chief,
Innovation Promotion Div.

Shuichi KUBOTA

Takahito TANABE

Kazumi IKEDA

Operating Ofﬁcer supervising
Corporate Strategy Dept.;
Deputy Division Chief, Administration Div.

Operating Ofﬁcer supervising
Manufacturing Engineering Dept.
and Manufacturing Dept. (sub);Deputy Division Chief, Manufacturing Div.

Operating Ofﬁcer supervising
General Affairs Dept.
and Human Resources Dept.;
Deputy Division Chief, Administration Div.

Takao MOCHIZUKI
Operating Ofﬁcer supervising
Manufacturing Dept. (principal)
and Innovation Center Preparatory
Ofﬁce (sub); Deputy Division Chief,
Manufacturing Div.

52

ARISAWA INTEGRATED REPORT

Company Overview
Company proﬁleCompany Name

Arisawa Mfg. Co., Ltd.

Head Ofﬁce

Minami-honcho 1-5-5, Joetsu-shi, Niigata-ken

Inauguration

April 8, 1909

(As of Mar. 31, 2023)

Establishment

July 1, 1949

Lines of Business

Manufacture and sales of electronic materials, industrial structural materials, electrical insulating materials, display materials,
and so forth.

Capital7,847,873 thousand yen

Number of Employees

1,458 (Non-Consolidated: 599)

Fiscal Year-end( Business year )April 1 to March 31 of the following year each year

Securities Code

5208

Market Division

Listed on Prime Market of Tokyo Stock Exchange

Ordinary General Meetingof Shareholders

To be held in June each year

Independent Audit
Corporation

Ernst & Young ShinNihon LLC

Transfer agent

Sumitomo Mitsui Trust Bank, Limited (1-4-1, Marunouchi, Chiyoda-ku, Tokyo)

Major Shareholders

Full name or corporate nameand Number of Stocks Held

Number of shares held

Shareholding ratios（%）

The Master Trust Bank of Japan, Ltd. (Trust account)

4,246,400

12.80

INTERTRUST TRUSTEES（CAYMAN）LIMITED SOLEL Y INITS CAPACITY AS TRUSTEE OF JAPAN-UP

2,404,800

7.25

Mitsubishi Gas Chemical Company, Inc.

1,472,166

4.43

Custody Bank of Japan, Ltd. (Trust account)

1,186,200

3.57

Arisawa Kenko Ltd.

834,338

2.51

Daishi Hokuetsu Bank, Ltd.

743,903

2.24

The Master Trust Bank of Japan, Ltd.
(Retirement beneﬁt trust account and Mitsubishi Electric Corporation account)

530,536

1.59

Sanji Arisawa

451,069

1.35

Nippon Life Insurance Company

388,822

1.17

Yoko Mori

378,180

1.14

Arisawa Mfg. Co., Ltd. ofﬁcial website
https://www.arisawa.co.jp/en/index.html

Company
https://www.arisawa.co.jp/en/co̲proﬁle/index.html

Sustainability
https://www.arisawa.co.jp/en/csr/environment.html

IR/Financial
https://www.arisawa.co.jp/en/ir/index.html

53About Arisawa

Value Creation

Stock Status

Management Policy

Sustainability

Company Overview（As of March 31, 2023）

Number of sharesissued and outstanding

33,541,124■ Individuals and others

44.6%■ Financial institutions

26.1%■ Other domestic corporations

Number of shareholders

18.2%■ Foreign individuals

23,434

8.7%■ Financial instruments business operators

1.3%■ Treasury shares

1.1%

Trends in Stock Price and Dividend(Yen)(April 1, 2018 to March 31, 2023)

1,600
1,400
1,200
1,000
800
600
400
200
0

2018

2019

2020

2021

2022

FY2018FY2019FY2020

FY2021

FY2022

Basic earnings per share (yen)

79.15

6.14

64.94

117.4086.46

Dividend per share (yen)

30.00

30.00

39.00

95.00

90.00

38.0

488.6

60.1

100.3

104.1

Highest

1,350

1,148

1,118

1,072

1,438

Lowest

655

680

738

844

885

Fiscal year-end

793

802

1,000

957

1,254

3.8

3.7

3.9

9.9

7.2

Total return ratio（%）
Share price(yen)

Dividend yield（%）※

2023※Dividend yield = dividend amount per share ÷stock price at the end of ﬁscal year

54

Where Future Pieces Arise

Arisawa Mfg. Co., Ltd.
〒943-8610
Minami-honcho 1-5-5, Joetsu-shi, Niigata-ken

https://www.arisawa.co.jp/