NOK CORPORATIONNOKESG DATA BOOK

2024

Content, Editorial Policy
This Data Book summarizes the NOK Group’s performancedata, policies, and initiatives related to the environment,
society, and governance (ESG). Referring to multiple
reporting guidelines, we have organized related numerical
data for each ESG category. We consider this Data Book
to be a vital means of improving communication withall of our stakeholders. We would appreciate your candid
opinions and feedback on the report.

Basic
Information

Company Profile
NOK Philosophy

01

Sustainability Overview

03

Environment Environmental Management

04

Information Disclosure Based on TCFD
Recommendations

07

Climate Change Countermeasures

10

Resource Conservation and Waste Recycling

12

Conservation of Water Resources

13

Management of Substances ofEnvironmental Concern

15*Some activities prior to the period covered and recent activities are also included

Environmentally Friendly Products

16

Publication Date
July 2024 (published annually)

Conservation of Biodiversity

18

Human Rights

25

Human Resources

27

Labor Practices

29

Diversity29

Human Resource and Welfare System

30

Occupational Safety and Healthcare

32

Supply Chain Management

34

Product Quality and Safety37

Coexistence with Local Communities and Society

40

Corporate Governance

44

Compliance47

Risk Management

50

Period Covered
Most of the activities described in this report took place infiscal 2023 (April 1, 2023 to March 31, 2024)

SocietyScope
NOK Corporation and 92 consolidated subsidiaries
Referenced Guidelines• ISO 26000: 2010 - Guidance on social responsibility• Global Reporting Initiative (GRI) Standards• United Nations Global Compact• Task Force on Climate-related Financial Disclosures(TCFD)
Contact
Sustainability Integration Dept., Corporate Affairs,
CEO Office, NOK CORPORATION
1-12-15 Shiba Daimon, Minato-ku, Tokyo 105-8585, Japan
TEL: +81-3-5405-6372 FAX: +81-3-5405-6379

GovernanceInitiatives and External Evaluations

57

GRI Standard Content Index

58

Disclaimer
This Data Book contains forward-looking statements regarding the plans, strategies and performance of the Group. These statements
are based on information available at the time of issue and involve risks and uncertainties. Please understand that future performance
may differ from these statements due to changes in the Business environment and other factors.

Basic Information
Company Profile
Company Name NOK CORPORATIONHead Office

1-12-15 Shiba Daimon, Minato-ku,
Tokyo 105-8585, Japan

Established

December 2, 1939

FoundedJuly 9, 1941

Capital ​23,335 million yen (as of March 31, 2024)

Number of
Employees

38,097 (consolidated, as of March 31, 2024)
3,337 (non-consolidated, as of March 31, 2024)

Consolidated
Subsidiaries

92 companies

Composition of employees by region (consolidated)

Europe and theJapan

United States

1,183 (3.1%)

10,683 (28.0%)
FY 2023

38,097
Southeast Asia

15,225 (40.0%)

persons

China

11,006 (28.9%)

Basic Information

Environment

Society​

Governance​

NOK Philosophy
NOK Group’s management ethos, embodied in the principleof respect for employees based on care and trust, has served
as the bedrock of our organization for nearly 80 years.
In 2023, we built upon this enduring legacy by crafting
Our Purpose and Our Values — new guiding principles
thoughtfully aligned with the prevailing social context.

As Global One NOK, we unite with the shared values
embraced by our worldwide workforce, and together, we
aim to achieve a sustainable society while continuing toelevate our corporate worth. We intend to accomplish
this goal by generating value that serves social needs andengaging in self-driven, responsible initiatives.

Our Purpose
Why we are here

Shaping Possibilities with Unique Technology

Our Values
The principles and values that guide us

RESPECTIGNITEWe respect diversity
and inclusivity

We ignite a passion for
innovation

EXPLORE

EXCEED

We explore every
We exceed expectations
possibility for betterby deliveringsolutions
exceptional results

We pursue our dreams

Our Founding Principles
1. T
 he Management has to run the Company based on feelings ofcare and trust in its employees.
2. T he Management has to run the Company while uniting to ensure
full ventilation without forming any cliques.
3. T he Management has to run the Company while making absolutely
incredible efforts against all odds and risks.
4. T he Management has to run the Company while pursuing dreams
with management plan.

01

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society

Governance

NOK Charter of Corporate Behavior

We, NOK Corporation, are committed to being an entity that fulfills the role of driving efforts toward the realization of a sustainable society
according to our founding Principles under the NOK spirit. We will pursue this through developing the Management Policies in such a way that all
our stakeholders are proud of us and chase their dream with us; and, while upholding the principle of fair and free competition, through creating
added value that is socially useful, generating employment, and acting autonomously and responsibly. In order to achieve this realization, we will
behave according to the eleven principles set forth below in the Principles of Corporate Behavior in both domestic and overseas operations, so as
so respecting human rights, complying with related laws, regulations, and international rules as well as the spirit behind those, and discharge oursocial responsibility with a strong sense of ethical values.
Enacted on May 1, 2006

Revised on July 1, 2019

Our Founding Principles

Management Policies

1. The Management has to run the Company based on feelingsof care and trust in its employees.

1.We are committed to be a strong and unique parts supplier
while focusing its managerial resources on core business areas.

2. The Management has to run the Company while uniting toensure full ventilation without forming any cliques.

2. W e are committed to be a profitable and robust company while
fulfilling company-wide cost reduction programs ranging fromfront-line sales to manufacturing floor.

3. The Management has to run the Company while making
absolutely incredible efforts against all odds and risks.
4. The Management has to run the Company while pursuing
dreams with management plan.

3. W
 e are committed to continuously improving our quality while
producing and selling our products that are proven to betechnologically unique and socially useful, on a global scale.

Principles of Corporate Behavior
1. Provision of Socially Useful
Products

We will develop and provide socially useful and safe products through the creation of new value, and provide pertinent
information regarding products and have sincere dialogues with end users and customers while also working toachieve sustainable economic growth and solve social issues, thereby gaining their satisfaction and deeper trust.

2. Fair and Appropriate Trade

We will ensure that we engage in fair, transparent, and free competition, that transactions are appropriate, and that
responsible procurement is carried out, when selling products and purchasing materials. Also, we will maintain asound and proper relationship with political bodies and government agencies.

3. Proper Disclosureand Management ofInformation

We will disclose accurate information about the Company timely and appropriately, and have constructive dialogues
with the various stakeholders who surround our business in order to increase the corporate value. Also, protect andproperly manage personal and customer data and other types of information as well as intellectual property rights.

4. Thorough Risk Management
We will resolutely provide systematic risk management to prepare against activities of antisocial forces, terrorists,
and Severance of all
cyberattacks, natural disasters, and other elements that threaten the lives of the public and business activities.
relations with Antisocial
Especially we will resolutely confront any antisocial forces or groups and sever all relations with such groups.
Forces and Groups
We will proactively initiate environmental conservation activities while taking into account the fact that commitment
5. Commitment toEnvironmental Conservation to solving environmental issues is a prerequisite for a company to engage in business activities as a going concern.

6. Promotion of Social
Contribution Activities

As a good corporate citizen, we will actively participate in communities and contribute to their development.

7. Cooperation with theInternational Community

As a global corporation, we will comply with laws and regulations of the countries and regions where our business
operations are based , and respect human rights and other international norms of behavior (ex. prohibition of childlabour and forced labour). Also, conduct business by taking into consideration the local culture and customs as wellas the interests of stakeholders, and contribute toward the development of the local economy and society.

8. Respect for Human Rights

We will carry out management that respects the human rights of all people.

9. Provision of a Safe andComfortable Working
Environment

We will realize a work style that enhances the abilities of employees while respecting their diversity, character andpersonality, and by drawing a line between public and private matters, and maintaining order in the workplace, wewill realize a comfortable working environment that takes cleanliness, health, and safety into consideration.

10. R esponsibilities of Our
Officers

Our officers, while carrying out management with the recognition that it is their role to realize the spirit of thisCharter, will establish effective internal control systems, and will take the lead in an exemplary manner to implement
the Charter within the entire NOK Group, while encouraging our business counterparts to act in a mannerconsistent with this Charter. In addition, our officers will constantly listen to opinions from both within and outside
the Company to ensure compliance with business ethics.

11. R esponse to Problems

In the event that a matter in noncompliance with this Charter arises, which causes society to lose trust in us, ourofficers will take steps such as taking the lead in solving the problem, identifying the cause, and taking measures toprevent the recurrence of similar problems, thus fulfilling their responsibilities. Moreover, they will publicly disclose
relevant information promptly and appropriately, fulfill their accountability requirements, indicate those who are inauthority and those who are responsible, and severely punish those involved, including them.

02

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​

Governance​

Sustainability Overview
NOK Group Sustainability Statement
At NOK Group, we aim to extend beyond generating
economic benefits for stakeholders: we aspire to evoke
a profound sense of pride in them. To that end, we
have been dedicated to fostering a sustainable society
alongside our business endeavors since our founding.
Our Purpose statement, “Shaping Possibilities with
Unique Technology,” reflects our ambition to enhancepeople’s lives with innovative products resulting fromproprietary technologies based on our R&D, and we strive
to offer people safer and more comfortable lifestyles byharnessing these capabilities and embracing diversity anduntapped possibilities.
We remain committed to proactively tacklingworldwide environmental and social challenges byleveraging the inherent value within our company torealize a sustainable society.

Governance
We have set up a Sustainability Committee as anorganization that discusses sustainability for the Groupand decides on policies and other matters.
Chaired by the Group CEO and composed of top
management including the Group CFO, the Sustainability
Committee discusses and decides on sustainability
measures and policies. It also addresses key issues crucial
to the Group’s management and shares its findings withthe leadership team. As well as conducting reviews, it

submits proposals and reports to the Board of Directors.
The Sustainability Office serves as the secretariat andholds meetings regularly (in principle, once a month).
Since sustainability risks are closely linked to theGroup’s management risks, the Sustainability Committee
coordinates with the Risk Management Committee totackle them.

Board of Directors
Proposal/Report

Proposal/Report

Sustainability Committee

Risk Management Committee
Cooperation

Chairperson: Group CEO
Members: Group CFO and other executives
Secretariat: Sustainability Office

Chairperson: Group CEO
Vice-chairperson: Group CFO
Members: Executives
Secretariat: Business Strategy Div.
Management Planning Div.
Legal Affairs Div.

Risk Management
We have outlined the basic policy and management
framework for risk management across the Group in the
Risk Management Regulations. We have established a
Risk Management Committee chaired by the Group CEO,with the Group CFO as vice-chair and executive members

as committee members. This committee drives theGroup’s risk management initiatives, reviewing businessstrategy risks and potential loss risks that could affect theCompany’s management. It also reviews and decides onrisk management and compliance policies.
* See page 50 for details.

03

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

Governance

Environment
Environmental Management
Basic Concept

The NOK Group has established a system in accordancewith ISO 14001 standards, promotes environmental
management, and strives to implement environmental
management with the next generation in mind, thereby

reducing its environmental burden. The current percentage
of NOK Group establishments with ISO 14001 certification
is 100%.

NOK Group Environmental Statement

As NOK Group is a part of society, all employees recognize that the company ʼs operations, products, and services have a significant impact on
the environment on a global scale. To foster the development of a sustainable society, we establish NOK Group Environmental Statement andstrive for environmental conservation management that considers future generations and beyond. We also work with internal and external
stakeholders, including employees, shareholders, local communities, and business partners in the value chain from raw material procurement,
production, distribution, use, and disposal to continuously reduce our environmental impact.

1

Based on our existing proprietary technologies, we strive to reduce environmental impact by promoting the improvement oftechnologies and the development of products that take environmental conservation into consideration.

2

We comply with environmental laws and regulations, local government ordinances, and regional agreements, etc., andpromote activities for environmental conservation.

3
4
5

We promote energy conservation and reduction of greenhouse gas emissions to achieve a decarbonized society.
We strive to conserve resources and contribute to a circular society by reducing, reusing, and recycling waste.
To conserve water resources, we promote efficient water use and appropriate management of water quality.

6

We assess our impact on biodiversity and promote biodiversity conservation activities tailored to local characteristics incooperation with business partners and external organizations.

7

We strive to prevent environmental pollution and reduce environmentally hazardous substances by thoroughly managing all
chemical substances.

8

We disclose information on environmental conservation and social contribution activities and proactively communicate withlocal and broader society.

9

We promote environmental education for all our employees to raise awareness of the global environment.

10

We strive to continuously improve our environmental management system by setting targets, promoting activities to reduce
environmental impact, and regularly assessing progress.
Enacted on September 17, 2001
Revised on June 28, 2023
Representative Director, Group Chief Executive Officer, NOK CORPORATION

Masao Tsuru

NOK’s Environmental Strategy: Twin Green Plan 2030
In response to the global trend toward carbon neutrality andthe results of TCFD scenario analysis, we revised the NOK
Twin Green Plan 2030, formulated in 2018, and declaredthat we will aim to achieve carbon neutrality by 2050.

Under this long-term vision, the Group will work together
to realize a sustainable society through the provision of
eco-friendly products and business activities in response toelectrification of automobiles and carbon neutrality.

* For details, please refer to NOK’s website:
https://www.nok.co.jp/en/csr/twingreen.html

04

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​Compliance with Environmental Laws and Regulations
The NOK Group faced no major fines, surcharges, or lawsuits
related to environmental accidents or complaints in FY 2023.
* For details on fines, surcharges, and lawsuit costs, see page 18.

Environmental Awards

In FY 2020, the NOK Group introduced an environmental
awards program for the purpose of breathing life into
environmental activities within the Company and raising
the awareness of every employee regarding environmental
issues. The program comprehensively evaluates actions
taken at each site to address climate change, resource
efficiency and circulation, biodiversity, and otherenvironmental issues. The program also provides an

Governance​

incentive for action by recognizing the initiatives judged tobe the most outstanding with awards.
In FY 2023, NOK (Wuxi) Vibration Control China Co.,
Ltd. won the gold prize as a “Wuxi City Environmental
Protection Model Enterprise.” Mektec Manufacturing
Corporation (Suzhou) received the silver prize forachieving significant energy savings through compressor
improvements. Bronze prizes were awarded to NOK’s
Tottori Plant, for enhancing its wastewater treatment
system, and Changchun NOK-Freudenberg Oil Seal Co.,
Ltd., for continuously reducing environmental impact.
We will continue using this program to raise awareness ofenvironmental conservation throughout the entire NOKGroup and further improve our environmental activities.

Material Balance (Material Flow)
INPUT

FY 2023 NOK

Raw materials

DesignTotal raw-material input

85,516tons

Rubber12,297tons

Additives & Adhesives

10,884tons

Plastics

1,086

tons

Metals61,249tons• Environmental Conservation
Assessment of Products, etc.
• Environmental Impact
Assessment

Procurement

EnergyTotal energy input

1,173

TJ

Electric Power

1,043

TJ

Gasoline

30

TJ

Kerosene

3

TJ

Heavy Oil A

1

TJ

Light Oil

5

TJ

Liquefied Petroleum
Gas (LPG)

81

TJ

City Gas

11

TJ• Environmental Impact
Assessment• Green Procurement• Environmental Conservation
Inspection of Machinery andEquipment

Production• Life Cycle Assessment (LCA)• Pollution Prevention• Chemical Substances Control• Energy Conservation• Waste Reduction• Environmental Impact
Assessment

Water
Total water withdrawals

712

1,000 m3

Drinkable water503

1,000 m3

Industrial water32

1,000 m3

Groundwater177

1,000 m3

Logistics• Efficient Transportation• Promotion of Modal ShiftEnvironmentally hazardous substances
Chemical substances
subject to the Pollutant
Release and Transfer
Register (PRTR) system

1,316

tons

Customers

OUTPUTGas emissions
Total CO2 emissions(Scope 1 + Scope 2) *1

136 1,000 tons-CO2

Scope 1 (Fuel)

8 1,000 tons-CO2

Scope 2 (Electricity/heat)128 1,000 tons-CO2

Scope 3 (Indirect emissions)326 1,000 tons-CO2

NOx (Nitrogen Oxides) *2

11SOx (Sulfur Oxides) *

2

tons

2

1,000 tons

Total wastewater562

1,000 m3

Rivers506

1,000 m3

Sewage system

56

1,000 m3

5.9

tons

2

VOCs (Volatile Organic Compounds)

tons

Wastewater

BOD load *3

Industrial waste, etc.
By-product generation

39

1,000 tons

Industrial waste

14

1,000 tons

14

1,000 tons

Final disposal

Amount of waste recycled

0.01

1,000 tons

Valuable waste

25

1,000 tons

Environmentally hazardous substances
Chemical substances subject to the
Pollutant Release and Transfer Register 104(PRTR) system (discharge volume)
Chemical substances subject to the
Pollutant Release and Transfer Register 47(PRTR) system (amount of movement)

tons

tons

*1 Total CO2 emissions: Calculated based on the “Greenhouse gas emissions accounting and reporting manual.” The emission factor is based on the national emission factor bycountry published by the International Energy Agency (IEA).
*2 NOx (nitrogen oxides) and SOx (sulfur oxides): Total amount of NOx and SOx generated from specified facilities under the Air Pollution Control Act.
*3 BOD load: Biochemical oxygen demand (BOD) is one of the indicators of water pollution, and represents the amount of oxygen used by microorganisms to decompose pollutant
organic material in water. The figure for BOD load was obtained by multiplying the BOD measurement by the amount of effluent entering rivers.

05

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

Governance

Environmental Education

The NOK Group conducts a variety of education programs
to foster a company-wide environmental spirit. TheNOK Group conducts tiered training for its employees,
as well as specialized education that covers ISO 14001
management, energy conservation, resource-saving, waste
reduction, water risk management (intake and quality),
and chemical substance management. We also conduct
drills based on emergency scenarios. The result is raising
the environmental awareness of every employee.

Working with Suppliers

New employee

Level-specificeducation

Specialized
education(for eligible
employees)

The NOK Group administers a CSR survey to supplies topromote CSR initiatives such as reducing environmental
impact and working together across the supply chain.
*For detail, see page 34.

06

General employee Management positions

New employee
training

NOK CORPORATION ESG Data Book 2024

General employee education
Education for
management
positions
Emergency-related education
Education for internal auditors
Resource (waste, water)-related education
Energy-related courses
Chemical substances-related education

Environment

Basic Information

Society​

Governance​

Information Disclosure Based on TCFD Recommendations
In line with the recommendations of the TCFD, we disclose the NOK Group’s business strategies related to climate change.

Governance (Climate Change)

NOK Group is addressing to climate change by establishing a management system based on the Sustainability Committee.

Board of Directors
ReportSupervise
Cooperation

Sustainability Committee(Committee Chairperson: Group CEO)
ReportDirectClimate Change ‘Scenario
Analysis’ Subcommittee

ReportCooperation

Promote/ExecuteDirectCarbon Neutral
Subcommittee

DirectReportCooperation

Sustainability Office

Promote/ExecuteCooperation

Cooperation

Related Internal Organizations
NOK Group Environmental
Conservation Committee
Risk Management Committee
BCM Committee
Information Security Committee
Safety and Health Committee
Labor Management Councils, etc.
Promote/ExecuteVarious sites/ Group companies

Supervision of the Board of Directors

The Board of Directors regularly receives reports fromthe Sustainability Committee on issues related toclimate change risks and opportunities, as well as othersustainability matters. It approves and oversees progresson addressing them.

Sustainability Committee

We have set up the Sustainability Committee as the
body for discussing and deciding on the Group’s
sustainability policies. As well as discussing and deciding
on sustainability measures, the committee also discusses
key management issues. After sharing these with senior
management, it engages in further deliberation. The
committee then submits its proposal and report to the

Risk Management

The NOK Group’s “Risk Management Regulations”
stipulate the basic policy and management system forrisk management across the entire Group. We have alsoestablished a Risk Management Committee to promoterisk management within the Group.
Since sustainability risks are closely linked to theGroup’s management risks, the Sustainability Committee
coordinates with the Risk Management Committee totackle them.
The Climate Change ‘Scenario Analysis’Subcommittee, a sub-organization of the Sustainability
Committee, works with related internal organizations
to identify climate change risks and opportunities,
which it assesses based on their potential impact on
the business and the expected duration of that impact.

07

Board of Directors.
We have also set up two specialized organizations
under the Sustainability Committee to address climatechange, the Climate Change ‘Scenario Analysis’Subcommittee and the Carbon Neutral Subcommittee.
The Climate Change ‘Scenario Analysis’ Subcommittee
assesses the impact of climate change, while theCarbon Neutral Subcommittee plans and promotes
specific measures to address climate change. These
subcommittees collaborate with related internalorganizations and each branch or group company to drive
climate initiatives. We have established a framework thatthey regularly report on progress at the Sustainability
Committee.

The Sustainability Committee then assesses anddiscusses the findings, formulating countermeasures andreflecting them into our business strategies.

Strategy

We recognize that climate change is an importantmanagement issue that will affect our businesses into
the future. We assessed the impact of climate change,
and we have carried out scenario analyses in accordancewith TCFD recommendations to climate change
countermeasures in our management strategy. Based ondata from the International Energy Agency (IEA) andother sources, we defined two scenarios, the 4°C and a 2°C
scenarios for the impact of climate change on our businessand evaluated the risks and opportunities for NOK Group.
Based on the results of these scenario analyses, we will

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

be actions to address the identified risks and opportunities
of NOK Group. We will also continue to expand ourscenario analyses and incorporate their results into ourSociety​​

Governancebusiness strategies and management plans. We strive toimprove the resilience of our management strategies.

Envisioned world

4℃ scenario

Temperature rise

By the end of the 21st century, the global temperature rises by
about 4℃ compared to the pre-industrial era.

By the end of the 21st century, the global temperature rise is
kept to less than 2℃ higher than the pre-industrial era.

Policies/energy

Little or no progress in carbon neutrality policies, no carbon
tax introduced, limited deployment of renewable energy.

Carbon taxes are introduced, the share of renewable energy
grows, business costs rise accordingly.

The automotive industry gradually moves towards
electrification, but the bulk of vehicles still run on internal
combustion engines.

The automotive industry undergoes rapid electrification, which
results in a decline in the number of internal combustion
engine vehicles.

Gradual advances in electrification are accompanied by agradual rise in the price of related raw materials.

Markets related to renewable energy and the reductionof environmental footprints expand, and the robotics andsemiconductor markets also expand with the acceleration ofdigitalization. The expansion of these markets is accompanied
by rises in prices of related raw materials to levels even higher
than in the 4℃ scenario.

Rising temperatures increase damage from flooding and tropical
cyclones, which affects factory operations and supply chains.

While rising temperatures cause damage from flooding and tropical
cyclones, their impacts are smaller than under the 4℃ scenario.

Markets/raw
materials

Physical risks

2℃ scenario

Scenario definition Period covered: 2030
Scope of coverage: Consolidated
Referenced scenarios: IEA 2DS, IEA SDS, IEA STEPS, RCP2.6, RCP4.5, RCP6.0, RCP8.5, etc.

Risks and Opportunities
Physical Risks and Our Measures

More than 90% of the NOK Group’s production sites arelocated in Asia, including Japan. Among 76 production
sites, eight have been assessed to be of high risk by
the AQUEDUCT* flood risk assessment tool (rivers
and coastline). The scale and frequency of floods andtyphoon damage in the Asian region are expected toincrease in the future as the impact of climate change
worsens. Accordingly, all of NOK Group’s sites, notjust those currently designated as high risk, carry therisk of negatively impacting operations and upstream/
downstream supply chains. To combat this risk, we areassessing the risk of hazards from natural disasters at eachsite and, together with the flood risk of every site, we are
implementing longer-term (at least five years) to installa water gate and other disaster-prevention measures.
We are also ensuring we have enough raw materials andproduct inventory to cope with such risks in an effort
to minimize the impacts on upstream and downstream
supply chains.
* AQUEDUCT is a water risk assessment tool made available by the World
Resources Institute (WRI). It is presented in the form of a world map that showswater risks in terms of quantity, quality, and regulatory and reputational risks.

Transition Risks and Our Measures

The NOK Group’s mainstay products stop oils, liquids,
gases, and other substances in various forms from leaking
out with the use of sealing technology. A typical NOK

08

product is oil seals, which have long been used widely in
the internal combustion engines of vehicles. Given thatthe transition to a low-carbon society for the purpose of
alleviating the impacts of climate change is accelerating ashift towards EVs, we anticipate the risk of a decline in oil
seal sales for internal combustion engine applications. In
terms of response measures, the NOK Group is promoting
product development and sales expansion in fields thatoffer potential growth in a low-carbon society, including
electrical units for electric vehicles, seal products forbatteries, and flexible printed circuits (FPCs).
Also, another aspect of the global decarbonization
movement is the possibility that carbon tax regulations
in each country could be enacted and tightened. Mostof the NOK Group’s CO2 emissions come from the useof electricity and there are concerns that business costs
will increase if the amount of CO2 we emit directly istaxed, or if our power costs are hit with a carbon tax.
Therefore, with the aim of furthering our efforts to reduce
CO2 emissions, we raised our 2030 overall domestic
CO2 emissions reduction target to 50% and the overseas
emissions intensity reduction target to 30%, compared to
FY 2018. We will continue to look at solar power generationand the capacity of other technologies and products thatcan be adopted immediately, but up ahead, we will closely
examine and trial new emerging technologies and measuresand make investment plans to ensure that we reach our
reduction targets.

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​Group-wide

Impacts

Governance​

Seal BusinessElectronic Products Business

Risks

Opportunities

Actions

 eclining sales of conventional productsDfor internal combustion engine
applications due to the increase ofelectric vehicles.

Demandfor control/electrical units
and electronic components grows withelectrification.

 xpand sales to the electric vehicle (EV/E
FCV) market and growth industries(renewable energy, semiconductors, etc.).

 arbon neutrality increases
C
opportunities to grow sales of lowfriction, long-life products.

Createmore opportunities to expand salesof seal products for electrical units andbatteries for electric vehicles, as well as
newly developed products.


Decliningmarket competitiveness due
to delays in response to environmental
issues (prices, customers’ purchasing
policies).

Markets

 arkets related to renewable energy,
Msemiconductors, and labor- and powersaving (robots, etc.) grow.

 evelop and expand sales of productsDwith smaller environmental footprints (lowfriction, long life, high durability, bio-based
raw materials, etc.)Developand expand sales of FPCs forelectric vehicle batteries.

Expandsales in the renewable energy
storage battery market.
 ultivate the electric vehicle infrastructureC
market (charging stations).

 ising procurement costs due to carbon
Rtaxes on raw materials.

Raw ising raw-material prices due to shifts inRsupply-demand balance.

materials

 educe raw-material costs throughR
recycling and other effective uses ofresources.
 educe costs by improving supply-chainRefficiency.

 onitor supply-and-demand forecasts forM
raw materials, and optimize procurement
costs and prices. (Seal Business: rawrubber materials, steel materials, etc.;
Electronic Products Business: copper, etc.)
 trategy for developing material-savingSfabrication methods (to improve yields).
 onsider increasing the use of reusedCmaterials and product recycling.


Risingoperating costs due to carbon
taxes.

Carbon price

EnergyExternal
evaluation

 romote manufacturing efficiency andPenergy-saving initiatives.
(Improve motivation to save energy.)

Introduce internal carbon pricing.
 evelop new low-energy materials andDfabrication methods.

 ising energy procurement costs due toRshifts in electricity demand and powersource makeup.

I ntensifying competition among electric
power suppliers.

 orporate valuation negatively impactedC
due to insufficient environmental initiatives.

 ttract ESG investment by improvingAexternal evaluation.

 roactively disclose corporate informationPin accordance with the ESG Framework.

— arry out hazard risk assessments andCtropical cyclone/disaster countermeasures(water protection) at all locations.

 romote the introduction of in-houseP
renewable energy power sources using
public subsidies, etc.

Optimize our power procurement sources.
I ntroduce renewable energy sources suchas solar power generation.

 oncerns that these will become aCstandard for making investment andfunding decisions.
Supply-chain disruptions due to disasters.

Disasters

 evise the targets in the NOK Twin GreenR
Plan 2030.

 uspension of operations at Company
S
plants and damage to inventory instorage.

 ecure inventory levels that areSappropriate for the risk exposure.

Indicators and Targets

As part of our climate change actions, the NOK Group
formulated the NOK Twin Green Plan 2030, and has
been promoting the reduction of CO2 emissions anddevelopment of next-generation eco-technologies. To
strengthen our climate-change actions, we have recently
raised the CO2 emission reduction targets set in the NOK

Twin Green Plan 2030 based on results from our TCFD
scenario analyses. With the aim of achieving carbon
neutrality by 2050, we will continue to promote initiatives
to address climate change and consider revisions to ourtargets from time to time based on the results of scenario
analyses and social conditions.

Targets
2050 Aiming to achieve carbon neutrality
2030 NOK consolidated (in Japan) 50% reduction in CO2 emissions (compared to 2018)
NOK consolidated (overseas) 30% reduction in CO2 emissions per unit (compared to 2018)09

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​​

Governance

Climate Change Countermeasures
Basic Concept

In recent years, climate change has come to the fore as a
global challenge. Efforts to reduce carbon emissions haveaccelerated in Japan and around the world, as instancedby the entry into force of the 2016 Paris Agreement andJapan’s declaration on 2050 carbon neutrality pledge.
Recognizing that climate change is an important global
issue that must be addressed to create a sustainable society,
the NOK Group is working to achieve carbon neutrality
by 2050. Following the TCFD recommendations, weanalyze the risks and opportunities that climate changepresents for the Company. We incorporate climate change
countermeasures into our management strategies. We also
strive to reduce energy use thoroughly across our value
chain, including manufacturing and logistics, and actively
introduce renewable energy to cut CO2 emissions.

Policy Views

The NOK Group supports the Paris Agreement enacted
in November 2016, which aims to hold “the increase in
the global average temperature to well below 2°C above
pre-industrial levels” and pursue efforts “to limit thetemperature increase to 1.5°C above pre-industrial levels.”

We also support Japan’s October 2020 pledge to achievecarbon neutrality by 2050, setting this as the CO2 emissions
reduction target for our business activities. In pursuing these
efforts, we comply with climate change policies like the “Acton Promotion of Global Warming Countermeasures” and the“Act on Rationalization of Energy Use and Shift to Non-fossil
Energy.” We also continue to promote proper information
disclosure and activities to reduce CO2 emissions and energy
consumption.

Managing CO2 Emissions and Energy Consumption
In FY 2023, our domestic group companies reduced CO2
emissions by 26.4% compared to FY 2018. Our overseas
group companies reduced CO2 emission intensity by
16.4%. Despite a slight increase in overall CO2 emissions
due to higher production, we are on track to meet the
NOK Group’s FY 2030 targets.
In addition, we have reduced electricity usage by
17.2%, bringing us close to our 2030 target of an 18%
reduction. Having almost met our renewable energy
target for 2030, we have now set a new target to increase
our usage of domestic renewable energy to 15% of our
total power consumption by 2025.

Scope of coverage

Unit

Baseline figure/
Base year

Target figure/Target year

CO2 emissions reduction

Consolidated

1,000 tons-CO2

759.49/2018

Carbon neutral/2050

658.13 (13.3% reduction)

CO2 emissions reduction

Domestic groupcompanies

1,000 tons-CO2

258.61/2018

129.3/2030 (50% reduction)

190.42 (26.4% reduction)

CO2 emissions intensity reduction

Overseas groupcompanies

ton-CO2/
millions of yen

1.31/2018

0.92/2030 (30% reduction)

1.10 (16.4% reduction)

Reduction in electricity
consumption (energy saving)

Domestic groupcompanies

GWh

455.5/2018

373.5/2030 (18% reduction)

377.05 (17.2% reduction)

Increase in renewable energy ratio

Consolidated%

0.01/201810/2030

12.21

NOK Group Targets

FY 2023 results* CO2 emissions are the sum of fuel and electricity consumption multiplied by the conversion factor. Fuel CO2 conversion factors are calculated using emission factors based on
the Law Concerning the Promotion of Measures to Cope with Global Warming. The electric power CO2 conversion factors are: domestic—emission factors by electric utility; andoverseas—“CO2 Emissions from Fuel Combustion” by the International Energy Agency (IEA) (using both market-based and location-based methods).
The renewable energy ratio includes CO2-free electricity, credits, and certificates.

CO2 emissions reduction target (domestic)

Greenhouse gas breakdown (domestic)
Greenhouse gas(1,000 tons-CO2)

300
250
200

Target ﬁgure

190 50% reduction

150
100
50
0

2018 2019 2020 2021 2022 2023

2030 (FY)10

CO2 emissions(tons-CO2)

GWP reference

CO2 emissions notfrom energy sources

59

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

CH4

346

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

N2O

102

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

HFCs

1,068

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

PFCs

69

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

SF6

1,241

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

NF3

0

IPCC Fifth Assessment Report(AR5 value for a 100-year time horizon)

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FY 2023 Scope 3 breakdown

CO2 emissions intensity (overseas)

Category(tons-CO2/millions of yen)

1.600
1.425
1.250
1.075
0.900
0.725
0.550
0.375
0.200

Target figure
30% reduction

1.095
FY 2023
CO2 Intensity

16.4%

decrease comparedto FY 20182018 2019 2020 2021 2022 2023

2030 (FY)

CO2 emissions reduction target (consolidated)(1,000 tons-CO2)

658
Target ﬁgure
Achieving carbon
neutrality

2018 2019 2020 2021 2022 2023

2050 (FY)

Adoption of Internal Carbon Pricing

The NOK Group is promoting the adoption of internalcarbon pricing (ICP) to further measures aimed at reducing
CO2 emissions with a view to achieving carbon neutrality.
Internal carbon pricing is a mechanism that we use toattach our own monetary value (carbon price) to CO2emissions. In doing so, it provides a frame of reference forinvestment, thereby facilitating investment in equipmentthat contributes to CO2 emission reductions. We have set a
carbon price of 30,000 yen/ton-CO2 for capital investments(environmental investments) that help lower CO2 emissions(Scope 1 and 2), such as in extremely energy-efficientequipment and renewable energy equipment (solar power
generation). Using this mechanism, we intend to step up thepace of efforts to reduce CO2 emissions and do everything
we can to achieve carbon neutrality.

Insulation of Piping ValveAt NOK Tottori Plant, they are taking measures to reduceheat from boiler steam piping as part of their energy
conservation. They carried out that involved adding
insulation jackets to valves of boiler steam pipes to prevent
heat loss. This reduces the consumption of fuel (heavy oil
A) by 1,167 liters a year.

11(1,000 tons-CO2)

Scope of coverage CO2 emissions

1 Purchased goods and services

Consolidated

1,915

2 Capital goods

Consolidated

156

Fuel- and energy-related activities(not included in Scopes 1 and 2)

Consolidated

80

4 Upstream transportation and distribution

Consolidated

10

5 Waste generated in operations

Consolidated

9

6 Business travel

Consolidated

5

7 Employee commuting

Consolidated

16

8 Upstream leased assets

Consolidated

0

Consolidated-

10 Processing of sold products

Consolidated

0

11 Use of sold products

Consolidated

N/A

End-of-life treatment of sold12
products

Consolidated

2

13 Downstream leased assets

Consolidated

N/A

14 Franchises

Consolidated

N/A

15 Investments

Consolidated

N/A

Total

Consolidated

2,192

3

9

800
700
600
500
400
300
200
100
0

Governance​

Downstream transportation anddistribution* Category 9 is not included in the calculation because it is difficult to calculate its
current status.

Relations with Industry Associations

The NOK Group participates in formulating throughindustry associations to set industry-wide guidelines forachieving carbon neutrality. We also align our own actionplans with these guidelines to maintain consistency.
If an industry association’s policy significantly diverges
from societal trends, we will recommend that the policy
be reviewed.
Main associations in which we participate
Japan Auto Parts Industries Association (JAPIA)

Increasing the Efficiency of Pneumatic Systems

Mektec Manufacturing Corporation (Suzhou) has improved
its pneumatic systems, replacing compressors andadsorption dryers with high-efficiency equipment, which
reduces electricity consumption. This was combined with asystem for reusing waste heat from compressors to produce
hot water, reducing CO2 emissions by 768 tons per year.

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​​

Governance

Resource Conservation and Waste Recycling
Basic Concept

Resource Use and Waste Management

In recent years, many around the world are calling for ashift to a recycling society and demanding that businesses
further promote the efficient use of resources, taking
into account entire product lifecycles, as well as the 3Rs(Reuse, Reduce and Recycle). The NOK Group contributes
to realizing a recycling-oriented society through a rangeof measures throughout the product life cycle, including
the efficient use of resources such as raw materials, water,and energy as well as waste reduction and recycling ofresources by improving each process.
Resource use targets and results for FY 2023

Increase in by-product recycling rate

Scope of coverage
Domestic group companies

In FY 2023, our domestic landfill disposal amounted to
1,042 tons, a reduction on the previous year thanks toefforts in sorting and recycling. We reached a recycling
rate of 97.8%, meeting our target level. In addition, we
revised our target for industrial waste emissions to a
reduction of at least 1.0% from the average of the past five
years. This target level was also met.

Unit Baseline figure/Base year Target figure/Target year
96.8/2018%

FY 2023 results

100/2030

97.8* By-product: General term for industrial waste and valuable resources.
* Recycling rate: “Recycling rate = 1 – amount of landfill disposal / amount of by-product generated x 100”
Waste-related targets, and results for FY 2023

Reduction in industrial waste against
average of past 5 years

Scope of coverage

Domestic group companies tons

Amount of industrial waste generated (domestic)(1,000 tons)

70
60
50
40
30
20
10
0

Unit Baseline figure/Base year Target figure/Target year
23,062/2023(1.0% reduction)

23,295/2022

FY 2023 results
20,583(11.6% reduction)

Amount disposed of in landfill
and waste recycling rate (domestic)（%）(tons)

3,000

48

2,500

1

1,500
500
(FY)

■Amount disposed of in landfill

Thoroughly Sorting Waste

At the NOK Kumamoto Plant, we are working hard to cut
waste by sorting mixed waste thoroughly. By separating tools
discarded as mixed metal waste into iron scrap and plastic,
we have reduced industrial waste by 3.4 tons annually.

12

1,042

1,000

27
2018 2019 2020 2021 2022 2023

97.8

2,000

20

■Valuable waste ■Amount recycled

98.0

Target ﬁgure (Recycling rate)

0

100.0
98.0
96.0
94.0
92.0
90.0

����

����

����

����

■Amount disposed of in landfill (left)

Recycling Waste Sand�������� (FY)88.0

Waste recycling rate (right)

As part of waste disposal activities, Thai NOK Co., Ltd.
reviewed how it handles waste sand from its castingprocess, which used to be disposed of in landfills.
Following the review, it is now recycled as aggregate
for road foundations. As a result, the amount of waste
discharged to landfill has been reduced to zero.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​

Governance​

Conservation of Water Resources
Basic Concept

Assessment of Water Risks with AQUEDUCT

Currently, the global shortage of water resources is seen
as a problem. It has become increasingly important forcompanies to make effective use of water resources tobring about a sustainable society. The NOK Group works
to conserve water resources by identifying and reducing
the amount of water used in the manufacturing process of
our products, and by taking thorough measures to clean
wastewater. In addition, the NOK Group assesses thewater risks in each country and region. And we promoteconservation of water resources activities tailored to thecharacteristics of there.

The NOK Group conducts water risk assessments acrossthe Group to efficiently promote response measures towater risks. The results of the study on water stress at all
our production locations obtained by using AQUEDUCT*,
which is operated by the World Resources Institute (WRI),
are as follows:

Water stress
19

3

12

All

76

Response to Water Risk

The NOK Group uses high-quality water in the
manufacturing processes of our products. Ensuring a stablesupply of high-quality water is important in conducting
our business activities. If a natural disaster or other event
prevents a stable supply of high-quality water, we expect
this to impact a variety of value chains and disrupt supply
chains. Our business activities and water are closely related.
Moreover, since wastewater generated in the
manufacturing process may contain harmful substances,
there is a concern that if wastewater exceeding theeffluent standard prescribed by law is discharged, it
may cause environmental pollution and harm to the
local community. For this reason, we regularly carry out
thorough wastewater treatment control, run emergency
drills, and check response procedures.

5■Extremely high■High■Medium-high■Low-medium■Lowlocations37
The survey revealed that of 76 production sites, sixsites in Thailand and China and two sites in Germany are
production sites with high water stress. The NOK Group is
currently working to grasp and restrain water withdrawals
on a global basis. In addition, we will conduct water risk
assessments when new facilities are established, andwe will strive to make production and conserve water
resources with consideration for water withdrawals andwastewater.
* A water risk assessment tool published by the World Resources Institute (WRI).
It provides a world map with information on water risks such as quantity of water,water quality, regulations, and reputation.

Water withdrawals in certain water-stressed regions
Country
Thailand

Production sites(m3)

No. of sites

Water stress

Water withdrawals

Thai NOK Co., Ltd.

2

Extremely high634, 155

China

Changchun NOK-Freudenberg Oil seal Co., Ltd.

1

Extremely high49, 880

Thailand

Mektec Manufacturing Corporation (Thailand) Ltd.

1

High

927, 873

Thailand

Mektec Precision Component (Thailand) Ltd.

1

High

63, 760

13

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Society​​

the increase in water intake as consolidated goals andactively work to reduce water usage. In FY 2023, the total
water withdrawal for all our factories worldwide was 8,691
thousand cubic meters, while the total discharge was 6,613
thousand cubic meters. In our production process, we aim
to reduce water intake by optimizing the water circulation
facilities of the cooling tower and reusing wastewater.

Water Management

At the NOK Group, our water management approach
focuses on wastewater quality and water withdrawal
volume. For wastewater quality, we set internal standards
stricter than legal requirements and conducted regularwastewater analysis to ensure cleaner water discharge.
For water withdrawal management, we aim to control

Water resource targets and FY 2023 performance Scope of coverage
Increase-controlled water withdrawals

Consolidated

Unit
1,000 m3

The Electronic Products Business has production sites
in water-risk areas and involves some of the highest
water use in the NOK Group. As part of our measures toaddress future water risks, we have developed a water
management plan* for this business that aims to reducewater withdrawals by 6.4% compared to 2022 levels.
Specific initiatives in this plan include optimizing theamount of water supplied to air conditioning equipment,

Water resource targets and FY 2023 performance Scope of coverage

Unit

Reduction of water withdrawals

Electronic Products
1,000 m3
Business (domestic)

Reduction of water withdrawals

Electronic Products
Business (overseas)

Water withdrawals (consolidated)(1,000 m3)

8,667/2022

8,667/2022

FY 2023 results
8,691

and the water amount to clean pure water manufacturingmachine in our production. We also recycle wastewaterusing NOK UF membranes when generated during the
production of purified water, we are also diverting it todomestic water such as toilets flush water.
* This water management plan applies to 9 out of 52 main production sites in
the NOK Group (17%), and 61% of the Group’s total water withdrawal.

Baseline figure/Base year Target figure/Target year

FY 2023 results

816/2022702/2025 (14% reduction)

762 (6.6% reduction)

4,516/2022

4,290/2025 (5% reduction)

4,439 (1.7% reduction)(1,000 m3)

8,000

8,691

7,250

8,000

6,613

6,500

7,000

5,750

6,000
5,000

1,000 m3

Baseline figure/Base year Target figure/Target year

Wastewater (consolidated)

10,0009,000

Governance2018 2019 2020 2021 2022 2023

14

(FY)

5,000

2018 2019 2020 2021 2022 2023 (FY)NOK CORPORATION ESG Data Book 2024

Environment

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Society​

Governance​

temperature evaporator. The cooling water generated by
the evaporator is reused, and the concentrated liquid istreated as hazardous waste.

Violation of Laws and Regulations on Water
Withdrawal and Wastewater

In FY 2023, there were no significant non-conformities in
the NOK Group related to water volume or water quality.
* For details on fines, surcharges, and lawsuit costs, see page 18.

Rice Paddy Ownership Program
Since FY 2019, the NOK Kumamoto Plant has supported
a groundwater recharge project by the Kumamoto
Groundwater Foundation as part of its efforts to protect
water resources. Businesses and groups sign agreementswith local farmers who have rice paddies in groundwater
recharge zones. As they grow rice together, the water
stored in the paddies soaks into the ground, recharging
groundwater levels. In FY 2023, 45 people took partin planting rice, and 17 helped with the harvest. They
managed to recharge 4,495 m³ of groundwater, and also
donated 150 kg of the harvested rice to a food bank. In
this way, the project not only conserves water resources
but also contributes to the local community.

Reuse of Brine Water

Thai NOK Co., Ltd. has been reusing drain water from air
conditioning systems and rainwater as toilet flush waterto cut water use. They recently also started supplying
brine water. By supplying 20.5 m3 of brine water per day,they have reduced their water use by 635 m³ per month.

Initiatives to Prevent Water Pollution

NOK (Wuxi) Vibration Control China Co., Ltd. took steps
to prevent water pollution by upgrading its wastewater
treatment facilities to a high-efficiency treatment systemusing reverse osmosis membrane and a low-temperatureevaporator. Contaminated water is filtered throughthe reverse osmosis membrane, following which thepurified water is reused and concentrated in the low-

Management of Substances of Environmental Concern
Basic Concept

Chemical Substance Management

Owing to the fact that chemical substances are destroying
ecosystems and harming people’s health, regulations on
substances of concern worldwide are being tightened year
after year. The NOK Group will reduce the substancesof concern used and emitted in its business activities,
minimize and try to eliminate the impacts of pollutantsin society, identify and manage chemical substances
throughout the product life cycle, and help reduce theenvironmental impacts in the entire supply chain.
VOC emission targets and FY 2023 results
Controlling VOC emissions

The NOK Group’s VOC emissions for FY 2023 were 2,704
tons, below our target of 5,855 tons.

Scope of coverage

Unit

Baseline figure

Target figure

FY 2023 results

Consolidated

1,000 tons—

5.86 or less

2.70

VOC emissions (consolidated)(tons)

6,000

Target figure

5,000
4,000

2,704

3,000
2,000
1,000
0

2010

2018 2019 2020 2021 2022 2023 (FY)15

NOK CORPORATION ESG Data Book 2024

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Environment

Modification of Vulcanizing Gas
and VOC Treatment Facilities

Society​​

GovernanceInitiatives to Prevent Air Pollution

Changchun NOK-Freudenberg Oil Seal Co., Ltd. upgraded its
existing VOC treatment facilities, installing high-efficiency
equipment. This boosted exhaust gas treatment efficiency
in the adhesion process to 90%, slashing emissions to well
below standard limits and cutting VOC emissions by 7.92
tons per year. They also equipped the vulcanization gas
treatment facilities with high-efficiency systems, increased
exhaust volume, and improved vulcanization gas treatment
efficiency to 90%. This reduced non-methane hydrocarbon(NMHC) emissions by 0.35 tons per year.

NOK (Wuxi) Vibration Control China Co., Ltd. uses
methanol in the bonding process following the
introduction of new products. Because methanol has asmall molecular weight, traditional adsorption methods
are inefficient, leading to a large amount of VOCemissions into the air and operating costs. To address
this, they adopted the liquid-phase absorption andthe concentrated distillation processing technologies.
Solvents are used to absorb the methanol based on theprinciple of “like dissolves like.” The resulting liquid
is then distilled to desorb methanol from the solvent,thereby reducing VOC emissions.

Environmentally Friendly Products
Basic Concept

Product Assessment

To minimize the impacts of climate change, the depletionof resources, waste treatment, the growing demand forwater resources, and other environmental risks, andto create a sustainable society, we cannot ignore theenvironmental burden of the products we use on a daily
basis. Companies are required to contribute to solving
environmental problems through develop products andtechnologies on considering for all on life cycle from theprocurement purchasing raw materials, manufacturing ofproducts, logistics, using, and disposing, that contributeto environmental conservation.
The NOK Group is developing products that contributeto next-generation eco-technologies, considering theentire product lifecycle.

We have given in document of "Environmental
Preservation Assessment Standards for Products" intended
for new product design, new material formulation design,
new manufacturing process design, and new production
facility design. Based on this standard, we conduct
environmental assessments throughout the entire
product life cycle from the product design stage throughto the processes design and manufacturing facility
design, and promote the development of environmentallyfriendly products.
In addition, NOK conducts risk assessments for its
products. When using new chemicals, we evaluate factors
such as safety, toxicity, environmental impact, and legal
compliance. We also set our own management categories
for each substance, such as bans on their use, reductions,and controls. This system enables us to properly control
harmful substances to prevent them contaminatingor leaking from our products. In this way, we manage
product risks such as hazards to the environment andhealth or legal non-compliance.

Assessment

Green procurement
Disuse of substances of concern(regulatory compliance, minimizing external discharge and dispersion)

DesignProduction

〇

〇

〇

〇

Use

〇

Reduction of energy consumption(using energy-efficient materials and equipment, contributing to energy savings during use)

〇

〇

〇

Use of resources(recyclable materials, fewer resources used, improved yields, improved service life)

〇

〇

〇

Reduction of waste(ease of disassembly, reuse, low disposal ratio)

〇

〇

16

NOK CORPORATION ESG Data Book 2024

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Basic Information

Environment

Society​

Governance​

Quantitative Data on Eco-Friendly Products (Production Volume, Waste Amount, Recycling Amount, etc.)
As part of the Green Product component of the Twin
Green Plan 2030, the NOK Group has continued toengage in business activities with the stated aim ofhelping to reduce CO2 emissions through its products. To
efficiently and effectively promote this initiative, we havecalculated, based on our own standards, the size of ourcontributions to CO2 reductions at the NOK product use
stage. These calculations showed that we cut emissions by
1.08 million t-CO2 in FY 2022 and 1.35 million t-CO2 in FY
2023. We will continue to contribute to the goal of carbon
neutrality by developing and expanding sales of productsthat help reduce CO2 emissions.

Approach to calculating size of contributions to CO2 reductions
CO2 reduction contribution [CO2] = contribution to CO2 reductions per product [CO2/items/hours] x duration of use[hours] x annual sales volume [items]* Only automotive products were included in the scope of calculation

Environmental Accounting

In targeting sustainable development and with the aim of efficiently and effectively taking action to address environmental
conservation issues, we grasp how much we need to invest and spend on environmental conservation in our businessactivities every year.
Trends in environmental investments and costs

Scope of coverage

Unit

FY 2020

FY 2021

FY 2022

FY 2023

Environmental conservation investments

Non-consolidated

millions of yen

464

495

544

637

Environmental conservation costs

Non-consolidated

millions of yen

620

550

556

655

Total

Non-consolidated

millions of yen

1,084

1,045

1,100

1,293

Scope of coverage

Unit

FY 2022

FY 2023

Pollution and resource costs

Non-consolidated

millions of yen

168

166

Pollution and resource investments

Non-consolidated

millions of yen

2

9

Water risk costs

Non-consolidated

millions of yen

49

24

Water risk investments

Non-consolidated

millions of yen

33

23

Environmental conservation costs

In terms of potential future costs, or shadow costs, we expect 96 million yen in pollution and resource-related costs,
which relate to measures such as waste treatment and analysis of environmentally hazardous substances. We also anticipate
20 million yen in water risk costs, which relate to measures such as wastewater and groundwater analysis and the purchaseof wastewater treatment equipment and chemicals.
Scope of coverage

Unit

FY 2020

FY 2021

FY 2022

FY 2023

Reduction of power consumption

Non-consolidated

GWh

5

9

11

12

Reduction of CO2 emissions

Non-consolidated

tons-CO2

2,033

4,258

5,006

5,586
FY 2023

Effects of environmental conservation

Economic effects of environmental conservation measures

Scope of coverage

Unit

FY 2020

FY 2021

FY 2022

Energy-saving effectNon-consolidated

millions of yen

61

107

194

259

Gain on sales of recyclable materials

Non-consolidated

millions of yen

248

1,256

1,145

1,083

17

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Environment

Society​​

Governance

FY 2023 NOK environmental accounting
Category

Main contents

Unit

Environmental conservation costs to control environmental burden causedby business activities within business areas

millions of yen

257

398

Pollution prevention costs

Investment, and maintenance and management costs related topollution prevention activities

millions of yen

10

135

Global environmental
conservation costs

Investment, and maintenance and management costs related to global
warming countermeasures, including energy conservation

millions of yen

238

97

Resource circulation costs

Investment, and maintenance and management costs related toresource recycling activities, including waste disposal and recycling

millions of yen

9166

Upstream and downstream costs

Costs of controlling the environmental burden that occurs in upstream
and downstream processes, such as green procurement, etc.

millions of yen

00Management activity costs

Costs associated with management activities such as ISO 14001
maintenance and operation

millions of yen

060

Research and development costs

Costs of research and development that contributes to the environment,
millions of yen
such as the development of environmentally friendly products

380

198

Social activity costs

Costs related to greening of business establishments and support for
the activities of environmental conservation groups

millions of yen

00

Costs involved in dealing withenvironmental damage

Costs associated with the removal of environmental burdens, such as
special equipment and facilities

millions of yen

00

Fines, penalties and/or legal costs associated with the settlement of environmental accidents and complaints

millions of yen

0

0

Total

millions of yen

637

655

Aggregate total

millions of yen

Business area costs

Investments

Costs

1,293

Conservation of Biodiversity
Basic Concept

Biodiversity Conservation Guidelines

In recent years, species have become extinct mainly asa result of the destruction of the natural environment,
overexploitation, and climate change, and subsequently,
the world’s biodiversity is shrinking at an alarming rate.
A new set of 23 targets for biodiversity through to theyear 2030, known as the Kunming-Montreal Global
Biodiversity Framework, was adopted. The conservation of
biodiversity is one of the global challenges, and efforts arebeing made in various countries.
The NOK Group undertakes no business activities inregions designated as a World Heritage Site and has noplans to do so. As part of our efforts to protect biodiversity,
we will carry out risk assessments and partner with externalorganizations to implement measures to help prevent
deforestation and alleviate the impacts on biodiversity.
We also ask that our suppliers take biodiversity
into account when doing business and we intend tostrengthen partnerships to ensure that net-positive
impacts are felt across the entire supply chain, not just by
our primary suppliers.

The NOK Group advances initiatives to conserve
biodiversity, aiming to achieve a net positive impact.
・We assess biodiversity risks in our business and identify
the impact of our activities on biodiversity.
・Based on the mitigation hierarchy (precedence of avoid,
minimize, restore, offset), we develop and implement
policies to prevent deforestation and conserve
biodiversity.
・We do not conduct business activities in globally
important biodiversity areas such as UNESCO World
Natural Heritage sites.
・We work with suppliers, external groups, and otherstakeholders to help prevent forest destruction andpreserve biodiversity.

18

NOK CORPORATION ESG Data Book 2024

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Basic Information

Society​

Biodiversity Risk Assessments

Governance​

within a five-kilometer radius, one of them is a wetlands
designated under the Ramsar Convention, while five others
are IUCN Category II protected areas (national parks).

To assess the risks pertaining to how the NOK Group'sbusiness activities might affect biodiversity, we used the
IBAT*1 to study the relationships between our production
sites and key biodiversity areas. The results of the study
revealed that of the sites where a nature reserve is located*1 IBAT is a biodiversity information database tool developed by an alliancecomprising the IUCN, the UNEP-WCMC, Birdlife International (aninternational environmental NGO), and Conservation International.

No. of sites

World
Heritage

Ramsar

MAB

Domestic production sites

50

0

1

Overseas production sites

26

0

Total

76

0

IUCN

Ⅱ

Ⅲ

0

0

0

0

5

0

Ia

Ib

0

0

0

0

0

0

1

0

0

5

0

*W
 orld Heritage: Sites chosen by UNESCO for their cultural, historical, or scientific importanceRamsar: a wetland designated by a country under the Ramsar Convention
MAB: Areas internationally recognized as biosphere reserves under the UNESCO Man and the Biosphere (MAB) Programme
IUCN: Areas inhabited by species listed as critically endangered or endangered on the IUCN Red List

We also used the WWF Biodiversity Risk Filter*2 toassess biodiversity risks at NOK Group’s 76 production
sites. As a result, none of our production sites werecategorized as being “very high risk” in terms of supply
services, regulatory and basic services, and impacts on
biodiversity. We will continue to perform risk assessmentsof biodiversity and our business activities, leverage
this time results of these studies in our measures for
safeguarding biodiversity, and press ahead with initiatives
best suited to the characteristics of each region.
*2 The WWF Biodiversity Risk Filter is a risk assessment tool for biodiversity
made available by the World Wide Fund for Nature.

Participation in Inawashiro Lake Clean Action

The NOK Fukushima Plant took part in the Inawashiro
Lake Clean Action, hosted by Fukushima Prefecture andother local authorities. Twenty-four staff members joined
to collect water weeds and trash along the lake’s shore, topreserve its beauty for future generations.

Wetland Conservation Activities

The NOK Group regularly carries out cleaning activities
around its domestic and overseas sites. Our Shonan
R&D Center works with an NPO to preserve the wetlands
around the Oba detention basin. Employees volunteer
to help, trimming plants to help protect penthorum
chinense, an endangered species of perennial herb, and topreserve the area’s scenic views.

19

Supply services

16 3

70

12

Very HighHigh

Regulatory andbasic services

86

14

MediumLow

Impact on
biodiversity

68
0%

20%

40%

Very low

32
60%

80%

100%

Efforts to Eradicate Lanceleaf Coreopsis

Kumamoto NOK Co., Ltd. carried out a joint operation
with Aso Kuju National Park Management Office ofthe Ministry of the Environment to remove lanceleaf
coreopsis. This invasive plant is known for its strong
reproductive ability which can pose a threat to nativeplants, and is designated as an invasive alien species bylaw. A total of 13 people, including employees of otherprivate companies, took part, removing 230 kilograms oflanceleaf coreopsis.

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​​

Governance

Environmental Performance Data
Unit

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

Total consumption of raw
Non-consolidated andmanufacturing subsidiaries
materials

tons

90,66180,64689,157

79,18385,516

RubberNon-consolidated andmanufacturing subsidiaries

tons

13,048

11,742

13,154

11,994

12,297

Compounding
ingredients andadhesives

Non-consolidated andmanufacturing subsidiaries

tons

10,971

9,921

11,012

10,188

10,884Non-consolidated andmanufacturing subsidiaries
Non-consolidated andMetalsmanufacturing subsidiaries
Non-consolidated andTotal energy consumption manufacturing subsidiaries
Consolidated

tons

1,083

965

1,149

1,039

1,086

tons

65,55958,01863,842

55,962

61,249Input

Scope of coverage

Plastics

TJ

1,260

1,156

1,245

1,230

1,173*1

TJ

5,101

4,709

5,276

4,958

5,014

Electricity

Non-consolidated andmanufacturing subsidiaries

TJ

1,126

1,039

1,118

1,104

1,043*1

Consolidated

TJ

4,390

4,079

4,600

4,319

4,415

Fuels

Non-consolidated andmanufacturing subsidiaries

TJ

134

118

127

127

130*1

Consolidated

TJ

711

630

676

639

599

0.010

0.010

0.010

0.010

0.009

0.009

0.010

0.010

0.008

0.008

Non-consolidated andTJ/millions of yen
Energy emissions intensity manufacturing subsidiaries
Consolidated
TJ/millions of yen

Renewable energy ratio
Total water withdrawals

City waterIndustrial water

Ground water
Inputs (water intake)emissions intensity
Water consumption

Consolidated

%

0.1

0.2

0.4

3.8

12.2

Non-consolidated andmanufacturing subsidiaries

1,000 m3

821

809

832

792

712

Consolidated

3

1,000 m

9,366

8,347

9,187

8,667

8,691

Non-consolidated andmanufacturing subsidiaries

1,000 m3

611

612

664

620

503

Consolidated

3

1,000 m

4,993

4,575

4,961

4,269

4,112

Non-consolidated andmanufacturing subsidiaries

1,000 m3

37

27

31

34

32

Consolidated

3

1,000 m

4,080

3,505

4,012

4,192

4,344

Non-consolidated andmanufacturing subsidiaries

1,000 m3

173

171

137

139

177

Consolidated

1,000 m

292

267

214

207

236

Non-consolidated andm3/millions of yen
manufacturing subsidiaries

5.9

5.9

5.6

5.7

5.5

Consolidated

m /millions of yen

17.0

17.0

16.6

14.1

14.0

Non-consolidated andmanufacturing subsidiaries

1,000 m3

289

302

235

218

150

Consolidated

3

1,000 m

1,632

2,237

2,568

2,625

2,078

1,000 tons

1.6

1.5

1.6

1.5

1.3

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

1,000 tons-CO2

8

7

8

8

8*1

1,000 tons-CO2

169

140

149

129

128*1

1,000 tons-CO2

178

147

156

137

136*1

Consumption of substances
Non-consolidated andmanufacturing subsidiaries
subject to PRTR
Output3

3

Scope of coverage
Scope 1

Non-consolidated andScope 2 manufacturing subsidiaries

Total CO2
Scope 1+2
emissions
Location-base*2 Scope 1
Scope 2
Scope 1+2

Consolidated

Unit

1,000 tons-CO2

43

38

41

39

36

1,000 tons-CO2

679

598

700

633

621

1,000 tons-CO2

722

636

741

672

657

20

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

OutputScope of coverage

FY 2023

FY 2019

FY 2020

FY 2021

FY 2022

8

7

8

8

8

Scope 2 manufacturing subsidiaries
Scope 1+2

1,000 tons-CO2

151

137

140

128

134

1,000 tons-CO2

159

144

148

136

142

Scope 11,000 tons-CO2

43

38

41

39

36

1,000 tons-CO2

650

590

685

628

622

Scope 2

Non-consolidated andConsolidated

Unit

Governance​

1,000 tons-CO2

Scope 1
Total CO2
emissionsMarket-base*2

Society​

1,000 tons-CO2

693

628

727

667

658

Consolidated

1,000 tons-CO2

268

269

2,169

2,137

2,192

Non-consolidated andmanufacturing subsidiaries

Kg

8,975

8,591

8,047

11,502

11,031

Domestic groupcompanies

Kg

23,49023,072

20,83821,697

16,057

Non-consolidated andmanufacturing subsidiaries

Kg

3,784

2,973

2,580

2,345

2,163

Domestic groupcompanies

Kg

3,784

2,973

7,757

3,103

4,805

VOC emissions

Non-consolidated andmanufacturing subsidiaries

1,000 tons

1.9

1.7

1.8

1.6

1.6

Consolidated

1,000 tons

3.4

3.1

3.2

2.9

2.7

Emissions of substances
subject to PRTR

Non-consolidated andmanufacturing subsidiaries

1,000 tons

0.132

0.102

0.123

0.099

0.104

Non-consolidated andmanufacturing subsidiaries

1,000 m3

533

507

597

574

562

7,734

6,111

6,619

6,043

6,613

Scope 1+2CO2 emissions for Scope 3
NOx

SOx

Total wastewaterRiver/lake

Sewage system

BOD load

Industrial waste
Amount of waste
recycled
Landfill disposal
amountConsolidated

1,000 mNon-consolidated andmanufacturing subsidiaries

3

1,000 m

471

451

538

510

506

Consolidated

1,000 m3

3,842

2,755

3,014

2,647

3,107

Non-consolidated andmanufacturing subsidiaries

1,000 m3

62

56

58

64

56

3

Consolidated

1,000 m3

3,892

3,356

3,605

3,396

3,506

Non-consolidated andmanufacturing subsidiaries

tons

3.97

3.53

5.34

4.04

5.92

Domestic groupcompanies

tons

5.16

5.36

6.96

7.92

12.77

Non-consolidated andmanufacturing subsidiaries

1,000 tons

15

14

15

14

14*1

Consolidated

1,000 tons

54

49

57

50

46

Non-consolidated andmanufacturing subsidiaries

1,000 tons

14

14

15

14

14

Consolidated

1,000 tons

42

44

51

44

43

Non-consolidated andmanufacturing subsidiaries

1,000 tons

0.34

0.03

0.02

0.02

0.01

Consolidated

1,000 tons

12

5

6

5

3

Valuable waste

Non-consolidated andmanufacturing subsidiaries

1,000 tons

28

24

27

24

25*1

Consolidated

1,000 tons

56

47

55

51

55

Recycling rate

Non-consolidated andmanufacturing subsidiaries

%

99.19

99.92

99.95

99.93

99.96

Consolidated

%

89.62

94.77

94.59

95.11

97.25

*1 This data has been verified by a third party.
*2 CO2 emissions are the sum of fuel and electricity consumption multiplied by a conversion factor. The CO2 conversion factor for fuel uses an emission factor based on Japan’s Act on
Promotion of Global Warming Countermeasures.
For electric power CO2 conversion factors, in Japan we use the emission factors of different general transmission and distribution utilities; overseas we use the CO2 Emissions from
Fuel Combustion factor of the International Energy Agency (IEA) (combining market- and location-based methods)

21

NOK CORPORATION ESG Data Book 2024

Environment

Basic Information

Society​​

Governance

Environmental Performance Results Aggregation Range
Page

Theme

Item

Input

P.5

Material Balance

OutputP.10-11

P.12

P.13-14

Climate ChangeCountermeasures

Resource Conservationand Waste Recycling
Conservation of Water
Resources

NOK Group Medium- to
Long-Term Targets

Targets and Results
Targets and Results

Aggregation range
Raw materials

Non-consolidated and domestic
manufacturing subsidiaries

EnergyNon-consolidated and domestic
manufacturing subsidiaries

Water

Non-consolidated and domestic
manufacturing subsidiaries

Environmentally hazardous substances

Non-consolidated and domestic
manufacturing subsidiaries

Gas emissions

Non-consolidated and domestic
manufacturing subsidiaries

Wastewater

Non-consolidated and domestic
manufacturing subsidiaries

Industrial waste, etc.

Non-consolidated and domestic
manufacturing subsidiaries

Environmentally hazardous
substances

Non-consolidated and domestic
manufacturing subsidiaries

CO2 emissions (consolidated)

Consolidated

CO2 emissions (domestic)

Domestic group companies

CO2 emission intensity (overseas)

Overseas group companies

Electricity consumption

Domestic group companies

CO2-free electricity ratio

Consolidated

Scope 3

Consolidated

GHG

Domestic group companies

Landfill disposal amount

Domestic group companies

By-product recycling rate

Domestic group companies

Industrial waste

Domestic group companies

Total water withdrawals

Consolidated

Wastewater

Consolidated

Water risk assessment

Consolidated

P.15

Management of
Substances ofEnvironmental Concern

Targets and Results

VOC emissions into the atmosphere

Consolidated

P.17-18

Environmentally
Friendly Products

Environmental Accounting

Various costs

Non-consolidated

Raw materials

Non-consolidated and domestic
manufacturing subsidiaries

EnergyConsolidated

Input

P.20-21

Environmental
Performance Data
Output22

Water

Consolidated

PRTR results

Non-consolidated and domestic
manufacturing subsidiaries

CO2 emissions

Consolidated

NOx

Domestic group companies

SOx

Domestic group companies

VOC emissions into the atmosphere

Consolidated

Wastewater

Consolidated(BOD indicates domestic group companies)

Industrial waste, etc.

Consolidated

PRTR results

Non-consolidated and domestic
manufacturing subsidiaries

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​

Governance​

List of ISO 14001-certified companies
In the NOK Group, 100% of plants/offices have obtained ISO 14001

Country

ISO 14001-certified companies

Scope of application

NOK CORPORATION
Tenei Seal Industry CorporationJapan

NOK METAL Co., Ltd.
Miyagi NOK Corporation
Miharu Industry Corporation
Tohoku Seal Industry Corporation
Nihonmatsu NOK Corporation
Isohara Polyurethane Industry Corporation
Isshin Industries Corporation
Kanasei Corporation
Kikugawa Seal Industry Co., Ltd.
MYK Corporation
TVC Co., Ltd.
Saga NOK Corporation
Kumamoto NOK Corporation
Kusu NOK Corporation
Nichinan NOK Corporation
Aso NOK Corporation
MEKTEC CORPORATIONMEKTEC-J Co., Ltd.
NOK KLUEBER CO., LTD.
UNIMATEC CO., LTD.
Synztec co., ltd.
Kuki Roll Industry Co., Ltd.
ESTOH Co., Ltd.
NOK Elastomers Processing Co., Ltd.

Thailand
Malaysia
VietnamIndonesia

China

TaiwanNOK Fugaku Engineering Co., Ltd.
Kusu Seimitsu Co., Ltd.
Thai NOK Co., Ltd.
Mektec Manufacturing Corporation (Thailand) Ltd.
Mektec Precision Component (Thailand) Ltd.

Headquarters Factory
Fukushima Plant: Certified as NOK

Certified as NOK
Certified as NOK

Certified as NOK
Certified as NOK

Certified as MEKTEC

Certified as Synztec co., ltd.
Tohoku Plant: Certified as NOK
Kyusyu Plant
Certified as NOK Fugaku Engineering Co., Ltd.

Synztec (Malaysia) Sdn. Bhd.
Vietnam NOK Co., Ltd.
Mektec Manufacturing Corporation (Vietnam) Ltd.
Synztec Vietnam Co., Ltd.
PT. NOK Indonesia
PT. NOK Freudenberg Sealing Technologies
PT. NOK Precision Component Batam
Wuxi NOK-Freudenberg Oil Seal Co., Ltd.
Changchun NOK-Freudenberg Oil seal Co., Ltd.
Taicang NOK-Freudenberg Sealing Products Co., Ltd.
NOK (Wuxi) Vibration Control China Co., Ltd.
NOK (Wuxi) Water Treatment Technology Co., Ltd.
Mektec Manufacturing Corporation (Zhuhai) Ltd.
Mektec Manufacturing Corporation (Suzhou)
Synztec Precision Parts (Shenzhen) Co., Ltd.
Mektec Corporation

Germany

MEKTEC EUROPE GmbH
Mektec Manufacturing Corporation Europe DE GmbH

Certified as MEKTEC EUROPE

Czech Republic

Mektec Manufacturing Corporation Europe CZ s.r.o.

Certified as MEKTEC EUROPE

Hungary

Mektec Manufacturing Corporation Europe HU Kft.

Certified as MEKTEC EUROPE23

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

GovernanceIndependent Verification Report

No.1811004769

Independent Verification Report
To: NOK CORPORATION
1. Objective and Scope
Japan Quality Assurance Organization (hereafter “JQA”) was engaged by NOK CORPORATION (hereafter “the Company”) to
provide an independent verification on the statement of information regarding Greenhouse gas emissions, energy use and total
amounts of industrial wastes for FY2022*1 and FY2023*2. The content of our verification was to express our conclusion, based on
our verification procedures, on whether the statement of information regarding Greenhouse gas emissions, energy use and total
amounts of industrial wastes on “Monthly report of Environmental Performance for FY2022” and “Monthly report ofEnvironmental Performance for FY2023” (hereafter “the Reports”) was correctly measured and calculated, in accordance with the“Calculation procedure of Environmental Performance,” (hereafter “ the Rule”) established by the Company. The purpose of theverification is to evaluate the Reports objectively and to enhance the credibility of the Reports.
The fiscal year 2022 of the Company ended on March 31, 2023.

*1

The fiscal year 2023 of the Company ended on March 31, 2024.

*2

2. Procedures Performed
JQA conducted verification in accordance with “ISO 14064-3” for Greenhouse gas emissions and with “ISAE3000” for energy
use and total amount of industrial wastes. The scope of this verification assignment covers energy-derived CO2 emissions fromScope 1 and 2 Greenhouse gas emissions, energy use and total amount of industrial wastes including valuables. The verification
was conducted to a limited level of assurance and quantitative materiality was set at 5 percent each of the total emissions in theReports. The organizational boundaries of this verification cover 32 plants for FY2022 and 34 plants for FY2023 in Japan managed
by the Company and its production subsidiaries.
Our verification procedures included:• Performing validation to check the Rule and overall monitoring and calculation system with Shonan R & D Center of theCompany.
• Visiting three sampling sites, Tokai plant of the Company, Kusu NOK Corporation, and TVC Co., Ltd. The location ofsampling sites was selected by the Company.
• On-site assessment to check the report boundaries; monitoring points of energy use and industrial wastes; and monitoring
and calculation system and its controls on each sampling site.
• Vouching: Cross-checking the reported data against evidence for all sampling plants.
3. Conclusion
Based on the procedures described above, nothing has come to our attention that caused us to believe that the statement of theinformation regarding Greenhouse gas emissions, energy use and total amount of industrial wastes shown in the Reports is notmaterially correct, or has not been prepared in accordance with the Rule.
4. Consideration
The Company was responsible for preparing the Reports, and JQA’s responsibility was to conduct verification of Greenhouse gas
emissions, energy use and total amount of industrial wastes in the Reports only. There is no conflict of interest between the
Company and JQA.

Sumio Asada, Board Director
For and on behalf of Japan Quality Assurance Organization
1-25, Kandasudacho, Chiyoda-ku, Tokyo, JapanMay 28, 2024

24

NOK CORPORATION ESG Data Book 2024

Basic Information

Society​​

Environment

GovernanceSociety
Human Rights
Basic Concept
In its principles of corporate conduct, the NOK Group
upholds an approach to management that respects humanrights. As a corporate group with global operations, weare committed to respecting the human rights of all
stakeholders, including employees. We see this as essential
to contributing to the sustainable growth of society.
To address respect for human rights more concretely,
we formulated a Human Rights Policy with the desire
to make the NOK Group’s basic stance on human rights
known throughout our organization and among outside
stakeholders, and to gain understanding and cooperationin promoting respect for human rights. We share thepolicy widely both inside and outside the Company
through our website.
The NOK Group shares its views on human rights with
employees through booklets and smartphone apps. We
also ensure that business partners are aware of our stanceby sharing the human rights guidelines set forth in our
CSR Procurement Guidelines (page 35).
The Board of Directors approved the revised policy on
May 24, 2023.

NOK Group Human Rights Statement

Human Rights Statement

1

2
3
4
5
6

In line with our management philosophy of fostering a company driven by care and trust in our employees, the NOK Group places
utmost importance on the well-being and dignity of each individual within our organization. We are committed to upholding
human rights as protected in internationally recognized norms, including the International Bill of Human Rights, the ILO
Declaration on Fundamental Principles and Rights at Work, and the Ten Principles of the UN Global Compact.
The NOK Group aligns with and supports the United Nations Guiding Principles on Business and Human Rights, and ourcompany policy is founded upon these principles. Furthermore, through our Principles of Corporate Behavior, we recognize thatcompliance with local laws, adherence to international norms — including human rights, and consideration of cultural diversity,
customs, and stakeholder interests — are integral to our operations, and we pledge to respect human rights across all countries
and regions where we conduct business.

Scope of Application

This policy applies to all individuals within the NOK Group, including officers, employees, suppliers, and other relevant parties.
We require the utmost respect for human rights throughout our supply chain, ensuring that no entity associated with the NOKGroup is complicit in any human rights violations.

Human Rights Due Diligence

Based on this policy, the NOK Group will institute and execute essential mechanisms for human rights due diligence. Inalignment with the NOK Group Procurement Policy and CSR Procurement Guidelines, we require our suppliers to adhere tohuman rights standards. Additionally, we request our other business partners to uphold human rights based on this policy.

Remediation & Correction

We have implemented a dedicated point of contact for reporting human rights compliance violations and seeking consultations.
Upon identifying a breach that has resulted in or contributed to an adverse impact on human rights, we take prompt action toaddress and rectify the situation.

Education & Training

To ensure a comprehensive understanding and consistent implementation of this policy among all officers and employees, we
continually foster awareness through educational initiatives, training programs, and ongoing efforts. These initiatives specificallyfocus on enhancing knowledge and promoting a culture of respect for human rights and preventing harassment.

Priority Action Areas & Transparency

Following this policy, we concentrate on the designated priority action areas outlined separately to uphold our commitment tohuman rights. To ensure transparency and accountability, we diligently execute these initiatives and provide regular updates on
our progress and outcomes through various channels, including our company website.
Enacted: December 16, 2021
Revised: May 24, 2023
Representative Director, Group Chief Executive Officer, NOK CORPORATION

Masao Tsuru

25

NOK CORPORATION ESG Data Book 2024

Basic Information

Society​​

Environment

Governance

Priority Action Areas• Ensuring freedom of association and collective bargaining rights

NOK Group strictly adheres to the laws and regulations of the countries where we operate, ensuring that our employees are free to joinor establish labor unions without any hindrance. Moreover, we actively recognize and support the exercise of collective bargaining rights.

• Eliminating forced labor

The NOK Group maintains a zero-tolerance policy towards forced labor and human trafficking, whereby individuals are coerced into work
against their will and under the threat of punishment.

• Eradicating child labor

The NOK Group firmly opposes and prohibits child labor below the minimum age defined by labor laws and regulations in the countries
and regions where we operate and international norms.

• Ensuring equal opportunities and non-discrimination in employment

The NOK Group is committed to providing equal and unbiased employment opportunities to all individuals, irrespective of their race,color, gender, religion, political opinion, national origin, social origin, age, disability, HIV/AIDS infection or development, labor union
membership, sexual orientation, or political or personal beliefs. We strictly prohibit any form of discrimination based on these grounds.

• Ensuring harassment prevention

At the NOK Group, we hold the utmost respect for the human rights of every employee. We maintain a zero-tolerance policy towards all
forms of harassment, including power harassment and sexual harassment.

• Ensuring fair wages and responsible working hours

We are dedicated to upholding the payment of wages following legal requirements and endeavor to provide living wages or higher.
Additionally, we strictly prohibit excessive overtime work that surpasses the legal limits on working hours.

Promotion Framework
Respect for human rights is crucial in all businessactivities. At the NOK Group, the HR Department, Legal
Affairs Department, and Sustainability Department work
together under the oversight of the General Manager of the
Corporate Administration Office to drive this effort. The
Internal Control Audit Committee, which advises the Boardof Directors, regularly audits the human rights compliancesystems of NOK and its subsidiaries based on internal
control regulations. It reports its findings to the Board of
Directors and the Audit and Supervisory Committee.

to prevent them from happening again. We may takedisciplinary action for human rights violations inaccordance with internal guidelines.
We have also set up a consultation service (in the
Legal Affairs Department) for suppliers with complianceconcerns, including those about human rights violations,in dealings with NOK Group companies. We conduct
human rights due diligence as stipulated in our Human
Rights Policy, including in the supply chain, and takecorrective action when we identify any rights violations.

Initiatives

Respect for Basic Human Rights in Relation to Employees

Confirming Human Rights Compliance

Regarding respect for human rights and compliance withlabor laws at overseas subsidiaries, we confirm annuallywhether there has been any discriminatory treatment of
employees or incidences of harassment, child labor, orforced labor.
Also, as a consultation service for human rights
issues, we have set up internal and external reporting
hotlines in Japan, staffed by a lawyer. We have alsoestablished an internal reporting hotline at each of ouroverseas subsidiaries. We have rules in place to safeguard
information at the hotline where it is shared. These
rules ensure details are kept confidential and protect
the whistleblower from detriment. We receive several
consultations every year. When we find compliancebreaches, we take proper corrective actions and work

26

The NOK Group Principles of Corporate Behavior set
forth the values of respect for human rights and provisionof a comfortable and secure working environment. Our
Behavioral Guidelines on Employee Compliance also
stipulate respect for human rights and the prohibition of
discrimination and harassment.

Implementation of Human Rights Due Diligence

We conduct a survey on human rights and labor practices
at NOK and all our subsidiaries. In FY2023, the NOKGroup assessed six key areas of its human rights policy:
freedom of association and collective bargaining rights,
forced labor, child labor, equal opportunities and nondiscrimination in employment, harassment, and fair wages
and responsible working hours. We also reviewed theconditions of technical trainees in Japan. We confirmed

NOK CORPORATION ESG Data Book 2024

Basic Information

Environmentthat no immediate corrections for human rights violations
were necessary.
We also conducted similar surveys for our major
suppliers and received responses from approximately 80%of them. Details are in the supply chain section on page 34.

Mitigation and Improvement of
Human Rights Risks

In FY2023, NOK had two cases where individuals faced
disciplinary action for harassment or other human rights
violations. In each case, we investigated the facts toensure the person seeking advice would not face any
detriment. We took appropriate action based on internal
regulations and alerted employees to prevent similar
incidents from happening again.
Our other Group companies also did not have any
immediate human rights violations requiring immediate
correction. However, it was noted that some companies lacka system to regularly check for discrimination. There werealso cases of temporary overwork during peak periods. To
ensure proper labor-hour management, we instructed

Society​​

Governancethem to regularly check for discrimination and review
task assignments.

Providing Human Rights Education

To raise awareness among employees of the NOK Group,
we produced online content and educational videos
providing basic knowledge on human rights and recent
topics. For employees at the manager level and above,
we provide education on human rights and harassmentin the year they are appointed to management positions
and in the fourth year. This training includes guidance on
how to handle reports and consultations on bullying andharassment.

Initiatives Against Forced Labor and Child LaborAt the NOK Group, to prevent forced labor, we make surethat we do not charge impose fees that would cause themto engage in forced labor. We do not require the surrenderor restrict the use of passports or other identification
documents. To prevent child labor, we check each worker’s
age using a valid certificate or document.

Human Resources
Basic Concept
Under the Basic Principle of Human Resources
Development and the Vision of Human Resources
Development, the NOK Group aims to create workplaces
where employees can find satisfaction in their jobs andfeel that they are growing. To this end, we are working todevelop personnel who can contribute to the creation ofsuch workplaces through various programs. One of the

Human Resources Development Program
The employee education program of the NOK Groupconsists of level-specific education and development/
specialized education.

Tiered Training

Alongside our usual tiered training programs, we
introduced a new training course that focuses on
instilling an understanding of the Purpose and Values weformulated in FY2023. This Purpose and Values training
is provided for all department directors and managers
within the NOK Group. It aims to foster a culture thatembraces our purpose and values, and to nurture
employees who are willing to take on challenges. In
FY2023, 514 people took the course.

27

four key pillars of the medium-term management plan is
to construct a diverse human capital foundation. When
we fully tap into the skills and individuality of a diverse
range of talent, new company value emerges. We havemade various reforms to build a foundation where every
employee can thrive.

Training and Specialized Education
NOK-U35 Program

As part of our efforts to develop the next generation ofleaders, in FY2023 we launched the NOK-U35 Program.
This program targets employees aged 35 and under,
chosen through a voluntary sign-up process. The aim is to
use the short time frame of the program to develop these
individuals into potential future leaders. We plan to takein a few participants each year. In FY2023, four people
joined this program.

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Society​​

Environment

Global Human Resources Development Program

GovernanceDigital Transformation Human Resources
Development Program

Since FY2016, we have run a Global Human Resources
Development Program to strengthen our competitivenessin overseas markets. This program aims to cultivate
people who can use English effectively in businesssettings. To develop global talent, we offer more thanstandard language training, providing English immersion
camps and role-playing for cross-cultural understanding.
In this way, we give employees in Japan as many
opportunities as possible to experience different cultures.
Three people took part in FY2023. So far, 20 people havecompleted the program, 11 of whom are working abroad.

We are rolling out data-driven initiatives across the NOKGroup. As a foundation for creating new value, we will
start a program that provides basic knowledge on data
and digital technologies to ensure employees can use
data effectively. All employees except for executives andmanagers will receive this training as “DX Standard” level
employees. The DX Standard training program launches
in July 2024. We expect around 2,500 participants.
In this way, we are developing a range of training programs
aimed at building a culture of embracing challenges.

System of Human Resources Development Program

Sub-section
Chief, AssistantSection Manager

Worksite leader training

4th year 4th year follow-up training
3rd year 3rd year career interview
New employee

Special training

New manager training

Business skills training

Section Manager

Temporary assignment
training

Manager follow-up training

Selective training for future leaders

Department director
training

Global human resources
development

Department Director

Digital transformation human resources
development program

Executive officer
training

Purpose and values training

Executive Officer

New employee training
Junior training program

Management program

Top management
programLevel-specific education

Special skills training
program

Human resources
development program

Development/specialized education

Engagement Survey
We administer an engagement survey targeting regular
employees and reemployed personnel of major domestic
Group Companies. FY2025, the final year of our mediumterm management plan, we aim for a score of 72. We areworking to improve engagement to meet this target.
In FY2023, the response rate was 98%, representing nearly
all targeted employees. Our comprehensive score surpassed
that of peer companies of a similar corporate scale.

Scope of coverage

Unit

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

Major domestic group companies

%

—

—

—

98

98

Engagement score

Non-consolidated

—

—

—

—

65

66

Percentage of highly engaged employees*

Non-consolidated

%

—

—

—

—

33.8

Item
Response rate

*We define “highly engaged employees” as employees with an overall score of 72 or higher

28

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

GovernanceLabor Practices
Basic Concept
At the NOK Group, we aim to respect and protect the rightsof our employees by putting into practice the management
principle of valuing human dignity. To achieve this, wefollow Principles 1 to 6 of the UN Global Compact anduphold our management principle of being “a company

with open communication.” We actively promotedialogue among employees and between the Company
and employees. We strive to create a workplace where
employees can work with peace of mind and enthusiasm.

Initiatives

Compliance with Labor-Related Laws
Our domestic Group Companies are instructed toensure compliance with the Labor Standards Act, theLabor Union Act, and all other labor-related laws. Our
overseas Group Companies are also instructed to ensurecompliance with labor-related laws of each relevant
country. There were no serious legal violations in FY2023.
Business sites in Japan that accept foreign technicalinterns have been checked for compliance with the
Immigration Control Act as well as for the working andliving environment and working conditions for interns.
We found that there were no problems overall.

Establishment of Healthy Labor Managementand Labor Relations Based on Dialogue
Dialogue between management and employees isessential to realizing “the management principle on
feelings of care and trust” and promoting healthy
development. Through respecting the right to organize,
the right to bargain collectively, and other rights of
employees, the NOK Group has built a healthy labor-

management relationship.
100% of employees of NOK Corporation and majordomestic Group Companies are members of labor unions(apart from non-eligible employees). Regular labormanagement meetings are held with the participationof the top management. Not only do we carry out
negotiations on working conditions, but also explain
business conditions and present management issues.
Also, discussions on the Company’s important policies
and measures take place so that both the labor side andthe management side can cooperate in realizing businessdevelopment and employee wellbeing. Measures thathave a significant impact on employees are explained anddiscussed in advance.
The Company explains the business environment andmanagement plan for the next fiscal year to the labor
union and holds consultations about them. With that inmind, the union submits a demand for consensus-based
compensation and working conditions for its members.
In the spring of 2023’s negotiations, the request was fully
discussed and concluded.

Diversity
Basic Concept
The NOK Group takes the stance of recruiting andappointing various diverse human resources regardlessof their gender, race or nationality. Approximately 40,000
employees of diverse nationalities, races, genders, andemployment types are currently working in the NOKGroup. We ensure that executives at both domestic andoverseas bases understand management based on respectfor human dignity, which is the basic principle of the NOKGroup, and promote the practice of such management inaccordance with the circumstances in each region.
We aim for an equal percentage of women, foreign
nationals, and mid-career hires in management positions
across the Group. There is no discrimination in promotions.
At our overseas locations, we base our approach on
localizing business operations. We actively hire local
talent and promote the development and appointment

29

of people who understand and are aware of the local
context, regardless of race or gender.
Interaction among executives and the technology,
manufacturing, sales, operations, and other departmentsof both domestic and overseas bases is facilitated sothat they can utilize the outcomes to develop personnel
and improve operational quality and efficiency in eachdepartment.
Furthermore, non-Japanese employees are appointed
to the executive positions of overseas subsidiaries. In
addition, we proactively advance the appointment,
development, and participation of employees of foreign
nationalities by providing training for engineering staff
and manufacturing operators of overseas subsidiaries
in the technology and manufacturing departments andhiring non-Japanese students in Japan.

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Society​​

Environment

GovernanceInitiatives

Female Empowerment
One issue Japan faces is the scarcity of women in
management positions. A survey on career aspirations
showed that few women aspire to become leaders or
specialists. We aim to broaden our job roles and change job
functions based on each employee’s skills and motivation.
We will also provide education on career development. In
FY2024, we will introduce a new HR system with multiple
career courses to support independent career growth. By
the end of FY2025 NOK Corporation and major domestic
Group Companies aim to double the number of female
managers compared to the end of FY2022, and to raise theratio of career-minded females to 30%.

Enhancing the Employment and Support
System for People with Disabilities
NOK furthers the employment of people with disabilities
so that they can take jobs according to their abilities
and aptitudes, and live independent lives in theircommunities. Facilities around Japan promote theallocation of people with disabilities to fulfilling jobs
and the creation of workplaces that enable them to work

comfortably to establish an environment where people
with disabilities can work with vitality.

Hiring Senior Employees
In FY2006, we introduced a reemployment system for
retirees so that motivated individuals can continue working
after retirement. As well as providing these employeeswith financial stability, the system allows them to passon their knowledge and skills to younger generations.
We are working to create opportunities where their richexperience and advanced skills can be put to full use.
In FY2016, we introduced flexible work arrangements
and revised our labor conditions. We have since continued
to review these conditions as needed. We also established
an internal job application system and a personnel
registration system for senior employees. We also continue
to implement measures to support senior employees after
retirement. These include life planning seminars for astable life post-retirement and pre-retirement training tohelp maintain their motivation to work.

(FY 2023)

Gender wage differential (ratio of women’s wages to men’s wages)
Classification

Unit

All employees
Regular employees
Non-regular employees

Annual income

Of which, monthly wages

Of which, bonus

Average

MedianAverage

MedianAverage

Median

%

74.2

80.1

76.4

77.6

69.2

86.2

%

77.0

81.8

79.2

79.8

72.5

86.6

%

65.6

63.5

67.3

64.9

58.1

57.1

Human Resource and Welfare System
Basic Concept
As part of management based on respect for humandignity, NOK is making efforts to create working
environments where employees can balance their job
satisfaction with a comfortable lifestyle. In addition toconventional initiatives, we now consider and undertake
various other measures from the viewpoint of workstyle reform. In terms of specific measures to realize

flexible and diverse work styles, we are also working on
implementing and improving a flextime system, childcare
leave, nursing care leave, and other employee benefit
systems, lowering the upper limit on overtime to shorten
working hours, and improving the rate of paid leave takenby employees.

Work-Life Balance
At the NOK Group, we have set up support systems
that go beyond legal requirements to create a better
workplace. We also share information about thesystem and provide advice through our intranet so that
employees can use it easily. We will continue to introduce

30

various systems to cater for the diversifying work styles
and lifestyles of today.

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Society​​

Environment

Governance

Systems to Promote Work-Life Balance
Flextime

Employees can choose to have no core time and set a non-working day for a work week with three days off

Remote work

Can be used up to 64 hours per month or 2 days per week

Half day of annual paid leave

Annual paid leave may be taken in half-day increments

Maternity leave before and after childbirth

Six weeks of paid special leave with pay before childbirth and eight weeks of paid special leave after childbirth

Spousal birth leave

Two days of paid special leave when a spouse gives birthChildcare leave system

Available until the child turns two years old

Shorter work hours for childcare

Available until the child reaches 4th grade of elementary school

Nursing leave

5 days/year for one child, 10 days/year for two or more children

Caregiving leave

5 days/year for one person requiring nursing care, 10 days/year for two or more persons requiring nursing care

Caregiving leave system

Available for up to one year

Shortened work hours for caregiving

Available for up to three years

Support leave

Paid special leave for medical treatment or recovery related to personal illness or injury, pregnancy,
childbirth, or for family care and caregiving. Childcare and spousal care support allowanceChildcare and spousal care support allowance

Financial support provided to those working while raising small children or caring for a spouse

Initiatives

Reinforcing Initiatives to Shorten Working Hours
and Encourage Paid Leave-Taking
NOK has endeavored to shorten the total actual working
hours to help employees pursue comfortable andprosperous lifestyles. The central labor-management
council annually develops a plan for new initiatives andreviews the performance of previous initiatives. Specifically,
we check the record of overtime work hours and paid leave
taken on both a departmental and individual basis byusing the relevant data, and thereby identify problems anddevelop a response plan. Our target is to keep total actual
working hours to within 2,000 hours and for employees totake 17 or more days of paid leave. We expect to achieve
this in FY2023. Our new target will be to keep total working
hours under 1,900 per year and will continue to review andimplement various measures to achieve this.

Reflecting External Expertise into
Our Personnel System Design
We take part in regular meetings and working group
activities related to the personnel policies put in place
by Japan Auto Parts Industries Association (JAPIA). This
allows us to gain information on industry trends related todiverse work styles and revisions to labor-related laws andregulations, which is useful in considering improvements
to the personnel systems.

31

Drawing on Career Aspiration Surveys and Interviews
Every year, NOK offers employees an opportunity to
declare on their current workplace situations and their job
aspirations. At that time, supervisors hold an interview
with employees regarding the content of the declarations,
including their career aspirations, which is used inpersonnel development and utilization, as well as to place
the right people in the right positions.

Workplace Communication
The NOK Group strives to always be an open andcomfortable workplace. Managers take the initiative inachieving and maintaining a level of communication
between superiors and subordinates, colleagues, andworkplaces. In addition to holding regular department
meetings, supervisors and their subordinates meet
about four times a year to discuss goals, progress, andachievements as part of our performance review process. We
began one-on-one meetings in FY2023 and are conducting areview toward full implementation in FY2025.

Support for Retiree Associations
To help employees enrich their lives after retirement,
NOK established retiree associations and supports eachassociation through holding each regional gatherings andother events for retirees to interact.

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Society​​

Environment

GovernanceOccupational Safety and Healthcare
Basic Concept
At NOK Group, we have the management principle basedon respect for human dignity, and we believe safety isa vital precondition for human dignity. We formulated
the NOK Group Safety Principles in FY2017 and pursued
health and safety activities across the Group with the aimof eliminating industrial accidents. In addition, in FY2022,
the Group CEO released a Health Declaration to indicate
the commitment of top management to initiate healthpromotion based on a health management approach.

As a company, we view mental and physical health as amanagement issue and are working to support employee
health. We also encourage employees to engage inhealthy activities on their own.
Safety Principles of NOK Group“Safety is the foundation for implementing management spirit that
respects human dignity, my desires, and my mission”

Occupational Health and Safety Promotion Framework
The NOK Group runs an occupational safety and healthmanagement system (OHSMS) based on the principles of
ISO 45001.*

and safety secretariats of each business site, branch, andGroup Company to maintain and improve the health andsafety management level of the NOK Group.

The Group CEO leads our framework for managing
work safety and health. This applies to all Group
companies and both on-site and off-site tasks. We aim toensure that everyone, including dispatched and contract
employees, works in a safe and healthy environment.
To this end, we promote safety and health activities andregularly check their progress through internal audits. We
have set emergency response procedures for each facility
based on our emergency response manual.
We have formed health and safety committees at eachbusiness site. These are made up of representatives frommanagement and employees and serve as a forum fordiscussing workplace safety and health. The committees
meet monthly to confirm the status of activities anddiscuss and decide on health and safety measures.
The Safety and Health Control Division, which
oversees the entire Company, collaborates with the health*Percentage of ISO 45001 certified offices: 16.3% (as of March 31, 2024)

Initiatives in Safety and Disaster Prevention
Establishing the NOK Occupational
Health and Safety Policy

Based on the NOK Group Safety Principles, we formulated
the NOK Occupational Health and Safety Policy in FY2022.
The policy indicates the specific direction of health and safety
activities in line with the thinking of the top management.

Occupational Health and Safety Promotion Framework
Group Chief Executive Officer
Central Safety and Health Committee (Chair: Safety Officer)
NOK Safety and HealthControl Division

Domestic plants

Safety and HealthCommittee(Chairperson: Head ofBusiness Unit)NOK

Head office/branches

Safety and HealthCommittee(Chair: Safety and Health
Officer [head office],
Branch Manager [branches])

Group Companies
Safety and HealthCommittee(Chairperson: Person
responsible for safety)

aimed for zero major accidents, but fell short of this goal as
one accident occurred. We will continue to carry out healthand safety activities across the entire Group based on the
NOK Group Safety Principles.
Medium-term Health and Safety Plan
· Improving the level of safety management to eliminate major accidents

Formulating Action Plans
We create annual action plans based on the status ofindustrial accidents. The Central Safety and HealthCommittee, chaired by the executive in charge of healthand safety and made up of representatives from labor andmanagement, deliberates and decides on the plan, which
it disseminates to all business sites along with priority
action items.
We formulated a medium-term health and safety plan
spanning FY2023 to FY2025 and have continued to takemeasures in the following three key areas. In FY2023, we

32· Equipment safety measures through risk assessment· Zero explosions and fires and thorough implementation of
measures to prevent recurrence

Business sites that have experienced issues suchas industrial accidents and require improvement aredesignated “specified management business units.” The
Safety and Health Promotion Department follows up withthese sites on an individual basis.

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Environment

Checking for Occurrence of Industrial Accidents
In FY2023, there was one major accident and eight losttime incidents. These accidents were mainly caused by
employees being trapped or falling down or by heavy
objects. The main issues were unsafe equipment and thelack of set work procedures. We therefore reviewed theequipment and work environment. We also set up work
procedures and provided training based on them. When an
industrial accident happens, we thoroughly investigate thecauses and background through on-site inspections andinterviews with those involved. We then share the findings
across all locations to prevent future incidents.

Measures to Improve Safety
Based on risk assessment results and past data such as
near-miss incidents and findings of safety patrols, we
identify processes, equipment, and tasks that we judge
to be high risk, based on the probability of them causing
workplace accidents and on the severity of the injury
that would be expected. We classify these as “designatedhazards,” and prioritize response measures andmanagement to address them.

Health and Safety Education
Health and safety education begins when employees firstenter the Company. We follow up with regular educational
programs to help employees gain the knowledge andskills needed to work safely, as well as hazard simulations
using hands-on hazard simulation equipment we designed
in-house. We also carry out training for line managers,
seeking to instill unified thinking about health and safety
management in their own workplaces and a sharedawareness of health and safety as managers. With the aim

Society​​

Governanceof instilling safety knowledge and maintaining and raising
the safety awareness of employees, we also offer training
at each workplace using “Safety and Health Guidelines
Handbook.” Created in 1972, we still use this Handbook asa tool for health and safety education and activities in theworkplace, revising them as needed.

Fire Prevention Initiatives
With a priority on preventing fire disasters and small
fires, we have formed the Fire prevention Task Force subcommittee as part of BCM activities to consider issues andresponse measures and deploy them across the Group.
We have also established a database that we use to share
Group-wide information on near-miss incidents and small
fires and deploy response measures horizontally.

Traffic Safety Initiatives
The NOK Group is committed to creating a culture of traffic
safety as a company engaging in transportation in society
through our products. For example, since the 1970s,
before legislation mandated the wearing of seatbelts, wehave worked to ensure that all occupants of our vehicles,
not just drivers, wear a seatbelt. In addition, we provide
education and guidance at each workplace to prevent
speeding and driving under the influence, which can cause
serious accidents. In addition, we participate in community
sponsored zero-accident, zero-violation challenges. We also
regularly hold traffic safety seminars with the help of local
police stations. To maintain and improve the road safety
awareness of employees, we have also established a system
to commend excellent drivers who continue to drive safely,
awarding them according to their number of years without
an accident or violation.

Initiatives in Health and sanitation
Health Management

We have a 100% regular health checkup rate. In addition, we
actively encourage medical examinations and provide healthguidance with the aim of ensuring that 100% of employees
undergo follow-up examinations for the early detection andtreatment of illnesses.
For mental health issues, we make online interviews withan industrial physician or counselor available. We have also
set up a 24-hour, year-round free telephone consultation
service through an external specialist organization, putting
in place a framework to respond early on to any issues
and support a smooth return to work. Also, we conduct
consultations with industrial physicians and health nurses
based on stress check results to prevent mental health issues.

Health Promotion
To boost employee awareness of health, we introduced ahealth management app for employee smartphones anduse it to disseminate health information. We also provide
aerobic exercise, stretching and other workouts under the33

guidance of our athlete employees to help staff develop
the habit of exercising.

Initiatives to Improve the Workplace Environment
The NOK Group first launched activities to improve our work
environment in 1993. Since then, we have systematically
implemented environment controls (noise, heat, and cold),safe work practices (working posture and the handling ofheavy objects), and support systems (such as providing
break-time facilities). In 2023, we have installed exhaust fansand makeshift cooling rooms as part of our heat mitigation
measures in the indoor workspaces.

Addressing Global Health Issues
The NOK Group has many overseas offices. For employees
and their families who are assigned abroad, they provide
information on infections like tetanus, hepatitis, andrabies. They also offer vaccinations and medical support in
those locations.

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Environment

Society​​

GovernanceSupply Chain Management
Basic Concept
At the NOK Group, we believe that to fulfill our corporatesocial responsibility, it is essential to share a common
awareness across the procurement supply chain whilebuilding relationships based on mutual trust.
Today’s society is also facing many problems such asenvironmental and human rights issues, and companies
are expected to help address these to build a sustainable
society. To this end, we established the NOK Group
Procurement Policy for conducting procurement activities
with suppliers.

At the same time, we ask suppliers to respect ourCharter of Corporate Behavior, the NOK Group Human
Rights Policy, the CSR Procurement Guidelines, and the
NOK Group Green Procurement Guidelines as we work
across the entire supply chain to achieve equitable, fair,and socially and environmentally friendly procurement
and bring about a sustainable society.

NOK Group Procurement Policy
1. We comply with laws, regulations and social norms.
2. Based on the idea of free competition, we select suppliers in a stringent manner by providing fair and equal opportunities.
3. We share mutual interests and benefits with suppliers based on the idea of mutual prosperity.
4. We engage in open communication and build relationships of trust with suppliers.
5. We conduct improvement activities proactively in collaboration with suppliers.

Promotion Framework
The NOK Group has established a Sustainability
Committee chaired by the Group CEO. We report key
matters concerning the Group’s overall procurement
activities to the Board through the Sustainability
Committee. We have set up a network between the
Procurement Division, which is led by an executive
officer overseeing procurement, and related companies,business divisions, and production sites. Through regular
procurement manager meetings, we share and implement
Group policies and measures. We are promoting oursustainable sourcing and other procurement activities
globally across the entire Group.

Supply Chain Management Promotion Framework
Board of Directors
Sustainability Committee
Secretariat: Sustainability Office

Procurement Division

Various sites/ Group companies
Suppliers

34

NOK CORPORATION ESG Data Book 2024

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Environment

Society​​

Governance

CSR Procurement Guidelines

To fulfill our corporate social responsibility, we request that not only our Group but also our suppliers refer to theseguidelines and actively promote CSR activities, including within their supply chains.

1

Compliance with laws and regulations
We will comply with laws and social norms in each country, including competition laws, trade-related laws, and environmentrelated laws.

Respect for human rights

2• We do not deal with business entities that use forced or child labor, that engage in unlawful employment of foreign nationals
or any other illegal employment, and that do not satisfy occupational safety and health regulations.
• We do not discriminate on the grounds of race, ethnicity, creed, gender, age, marital status, physical characteristics, disability,
etc., in any employment or treatment (application, recruitment, promotion, remuneration, right to receive education, work
grants, wages, welfare, punishment, dismissal, retirement, etc.).
• We comply with the laws and regulations of each country and region where employees are entitled to minimum wages,
overtime, wage deductions, piece-work payment, other benefits, working hours (including overtime), holidays, and annual
paid holidays. In particular, we recommend that wages exceed national and local laws and regulations, and we do not work
excessive overtime hours.
• We respect the freedom of association and the right to participate in collective bargaining, and engage in good faith dialogue
and consultation directly with employees or their representatives. We also recognize employees’ right to freely associate or notin accordance with the laws and regulations of each country and region.
• We do not accept any form of harassment, including abuses of power and sexual harassment.

3

Safety4

Green procurement

5

Confidentiality

6

Elimination of anti-social forces

7

Activities regarding conflict minerals

8

Contribution to local community and society

910

We prioritize the safety of customers and consumers, and purchase products that satisfy safety regulations.

We carry out procurement activities based on the NOK Group Green Procurement Guidelines with consideration for conserving
the global environment.

We deal with suppliers that can appropriately manage and control the confidentiality of information on customers, individuals
and technologies, etc., obtained through business transactions.

We do not deal with any organized crime groups, any of their members and related individuals, any other antisocial forces, orany business entities associated with them.

We strive to avoid purchasing minerals and their processed products sourced from countries where inhumane armed forces areactive and mining minerals for their financial resources.

We contribute to the development of the local community and society by proactively doing business with local suppliers.

Information disclosure
We disclose business information related to management and finance, product handling and safety, quality, environment
information, etc., to all stakeholders in a timely and appropriate manner, and develop and maintain mutual understanding andtrust through open and fair communication.

Deployment of CSR to suppliers’ own supply chain
To advance initiatives throughout the supply chain, we ask suppliers to implement initiatives throughout their own supply chain
equivalent to those described in the NOK Charter of Corporate Behavior and CSR Procurement Guidelines.

35

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Society​​

Environment

Initiatives

Governance

Identification of Key Suppliers

Education and Training in the Procurement Department

The NOK Group works with about 2,000 suppliers within
Japan. Among them, we identify suppliers with large
purchase amounts or those providing key products andmaterials as “key suppliers.” We have identified 71 key
suppliers so far and review them regularly.

To promote sustainable procurement throughout the supply
chain, during FY2023 we provided procurement department
leaders, including the General Manager of the Procurement
Division with training on sustainable procurement. In
FY2024, we plan to hold training sessions at key production
sites to further promote sustainable procurement.

Conducting the CSR Supplier Survey
We conduct an annual CSR survey focusing on key
suppliers we have identified.
The CSR supplier survey covers governance, humanrights, labor, environment, compliance, quality and safety,
information security, supply chain, and community
engagement, checking the efforts of each company in theseareas. We assess each company’s response, flagging any
suppliers whose efforts are found to be lacking as at-risk
suppliers.For at-risk suppliers and some key suppliers,
we carry out detailed interviews, on-site audits, andimprovement activities to minimize risks.
Number of suppliers (Japan)
Number of key suppliers

Approx. 2,000
71

Number of CSR supplier surveys conducted

238

Number of suppliers audited on-site

11

Number of at-risk suppliers

0Green Procurement
To boost our environment-related efforts in cooperation
with our suppliers, we issue the NOK Group Green
Procurement Guidelines. These guidelines informsuppliers about NOK Group’s environmental values andpolicies, enabling us to source eco-friendly raw materials
and parts. We ask suppliers to work to cut energy use,
reduce greenhouse gases, promote resource recycling,
lower waste production, and consider biodiversity. We
also ask that they submit a cooperation agreement.

36

Initiatives on Conflict Minerals
Since FY2013, we have been addressing the issue of
conflict minerals. Each year, we review the results ofefforts in the previous fiscal year. We then create a newplan and manage our progress regularly by supplier andbusiness division.

Conflict Minerals Surveys
At NOK, we use tin in some of our seal products. We havetherefore adopted the industry-standard Responsible
Minerals Initiative (RMI), (Conflict Minerals Reporting
Template (CMRT) and Extended Minerals Reporting
Template (EMRT). These templates help us trace our
supply chain back to its origins.
Once a year, we select materials for review and use the
CMRT and EMRT to conduct conflict minerals surveys
of suppliers. The survey checks for 3TG (Tin, Tantalum,
Tungsten, Gold), cobalt, and mica content, country oforigin, smelters, and supplier due diligence. We also
identify non-certified smelters in our supply chain bycross-checking them against the latest RMI-certified
smelter list. In FY2023, we conducted a survey on thesame raw materials as the previous year and received
responses from 433 companies. We reviewed the survey
responses closely. Where the responses from suppliers
were incomplete, we sought clarification to improve thereliability of the responses.

Participation in Supply Chain Initiatives
NOK is a member of the Japan Auto Parts Industries
Association (JAPIA). We work with customers, suppliers,and other industry firms to address challenges across theentire supply chain. As part of this, we are also advancing
our efforts to address the issue of conflict minerals.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

Governance

Product Quality and Safety
Basic Concept
The NOK Group has a longstanding commitment tomanufacturing, we have been focusing on ultimate quality
into the manufacturing process. Since our founding, ourtechnology and quality have earned the trust of numerous
customers, who use our products in a variety of fields.
To build in quality through the manufacturing process,our efforts have concentrated on cultivating the people
involved in manufacturing under our Management
Principles of respecting human dignity. We havedeveloped a variety of educational programs for thispurpose. Recently, we have focused on strengthening
the training of managers and supervisors, driven by
the desire to pass on the basics of manufacturing tofuture generations as veteran employees retire frommanufacturing sites.
In recent years, we have actively adopted digitaltechnology and set a quality policy theme of building
a foundation for compelling quality. Aiming to surpass
customer expectations through the added value (“+α”)
we offer, we have started efforts to further enhancecustomer satisfaction.

Basic policy“Putting quality first, we provide services and products that
customers can trust at all stages of research and development,
design, production, sales, service, etc.”

Behavioral guidelines

1. All employees work together to make constant efforts toimprove quality
2. Improve our unique technology

3. Continuously improve administration technology
4. Thoroughly comply with laws and regulations
5. Continuously manage the policy

Frameworks for Quality Management and Quality Assurance
To continue supplying products that meet customer
needs, NOK has established a quality management
framework based on ISO 9001 and other international
standards, which we are operating in pursuit of ongoing
improvement.

Quality Officers also supervise the planning,
coordination, and promotion of quality assurance. We
develop Quality Assurance (QA) Action Plans in line with
the NOK Quality Assurance Policy and conduct regularon-site Quality Assurance (QA) Reviews.

Quality Assurance System Overview

Policy, Decision Making

Formulation of a quality
assurance plan

Supervision of planning,
coordination, and promotion
QA Reviews

Seal BusinessGroup CEO

Quality Control Representative

Corporate Quality Control OfficeElectronic Products BusinessCorporate Quality Control Officer

Quality Control Representative

Quality Control Department
Directorsʹ Meeting· Deployment of best practices· Sharing of lessons learned

Other Business
Quality Control Representative

Domestic production departments
Overseas production departments
Production subsidiary

Production subsidiary

Production subsidiary

Plants in Japan do the following as mother factories:• Support for quality assurance activities• Support for product transfers and launches of overseas production• Promotion of priority issues

37

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

Governance

Quality Improvement Activities
We are taking steps to improve quality in all of our processes, from order receipt to delivery.

Overview of Quality Improvement Activities
Management process

Policy deployment

Quality Assurance Activity Plan

Audit, review

Quality Assurance Review

Communication

Quality Control Department Directors' Meeting

Product realization process

Customers

Order receipt

DesignTrial production

Mass production
Trial production

Mass production
InitialMass production

Delivery

Customers

Field quality

Judgment at quality gates

Mass-production process improvement

Customer satisfaction

Field quality monitoring activities

Special quality evaluation meeting

Activities to reduce non-conformity

Customer commendation

Education, training

SuT Program

Human resource development

Cultivation of administrators and supervisors

Motivation In-house

Quality Award System

Revitalization of the workplace

QC circle activities

Support process

Field Quality Monitoring Activities

QC Circle Activities

NOK draws on field quality data to regularly monitor foranything that could lead to significant complaints fromthe market. Using results obtained from past activity
performance assessments, surveys, and analyses, among
other data, we collaborate on initiatives such as proposing
improvements to customers.

NOK employees take initiative in conducting quality control(QC) circles to pursue quality improvement activities insmall groups. In QC circles, all members of the circle work
together to resolve matters they deal with in the day-to-day
workplace. QC circles also provide a venue for the growthand character formation of members through sharedactivities, which leads to a more vibrant workplace.
In FY2023, 730 QC circles in Japan and overseas took
part in a quality control competition. The top activity
presentations of circles selected by each company wereentered into the NOK Group QC Circle Convention,and the outcomes of the winning circles’ activities
were showcased. Since the first NOK Group QC Circle
Convention was held in 1963, this competition has been
held 71 times over the span of 60 years.

Improvement Activities through Quality Control
Education and Practice Based on QC-Oriented Thinking
NOK offers quality control education at each level of theorganization. We put a particular emphasis on problem
solving, where we advocate fact- and data-based logicalanalysis and improvement under the motto of “Let’s argue
from the data,” which is a hallmark of QC-oriented thinking.
To enable rapid problem solving, NOK offers a SuT*
Program which aims to support the more widespreaduse of tools that help speed up problem-solving. Having
started out with a course on the “Seven QC tools,” we now
offer more than 20 courses ranging from multivariate
analysis to design of experiments. We also have an
advanced curriculum to train participants in methods
through hands-on exercises.

Customer Quality Awards
We have received high marks from customers for ourquality achievements and improvement activities. In
FY2023, we received 35 commendations for quality.

* SuT stands for Speed-up Tools of Problem Solution.

38

NOK CORPORATION ESG Data Book 2024

Basic Information

Society​​

Environment

Governance

List of Quality Management System Certified Companies
Country

Certified companies (business divisions/business establishments)

Operating site

7-Mar-14

Tenei Seal Industry Corporation

ISO 9001

18-Dec-20

Miharu Industry Corporation

ISO 9001

12-Apr-21

Tohoku Seal Industry Corporation

ISO 9001

2-Apr-21

Miyagi NOK Corporation

ISO 9001

15-Mar-21

Nihonmatsu NOK Corporation

ISO 9001

3-Mar-21

NOK METAL Co., Ltd.

ISO 9001

14-Apr-21

Kitaibaraki Plant

ISO 9001

3-Sep-07

Isohara Polyurethane Industry
Corporation

ISO 9001

15-Dec-14

Shizuoka Plant

ISO 9001

9-Oct-13

Nihonmatsu Plant

ISO 9001

9-Oct-13

Tsukuba Plant

ISO 9001

9-Oct-13

MYK Corporation

ISO 9001

9-Oct-13

Kikugawa Seal Industry Co., Ltd.

ISO 9001

9-Oct-13

ISO 9001

17-Oct-07

Tottori Plant

ISO 9001

3-Jun-09

TVC Co., Ltd.

ISO 9001

3-Jun-09

Kumamoto Plant

ISO 9001

30-Sep-98

Isshin Industries Corporation

ISO 9001

28-Nov-11

Kanasei Corporation

ISO 9001

13-Apr-11

Saga NOK Corporation (Ureshino Plant)

ISO 9001

7-Feb-01

Saga NOK Corporation (Tosu Plant)

ISO 9001

7-Nov-08

Kusu NOK Corporation

ISO 9001

27-Mar-04

Kumamoto NOK Corporation

ISO 9001

24-Mar-04

Nichinan NOK Corporation

ISO 9001

24-Mar-05

Aso NOK Corporation

ISO 9001

25-Jun-08

Oil Seal Production

IATF 16949

28-Jan-18

Vibration Control Production

IATF 16949

24-Jan-18

Rubber Seal Production

IATF 16949

2-Feb-18

ISO 9001

1-Sep-09

NOK CORPORATION, Gaskets & Boots DivisionJapan
NOK CORPORATION Tokai Plant
NOK CORPORATION, Vibration Control Rubber Division
NOK CORPORATION, Precision Moldings & O‐rings Division

VietnamThai NOK Co., Ltd.

Vietnam NOK Co., Ltd.
P.T. NOK Indonesia

Indonesia

PT. NOK Freudenberg Sealing Technologies
Wuxi NOK-Freudenberg Oil Seal Co., Ltd.
Changchun NOK-Freudenberg Oil seal Co., Ltd.

China

Date of acquisition

ISO 9001

NOK CORPORATION, Plastics & Polyurethane Division

ThailandType of standards

NOK CORPORATION, Oil Seal Division

Taicang NOK-Freudenberg Sealing Products Co., Ltd.

IATF 16949

12-Dec-11

IATF 16949

26-Jul-17

ISO 9001

10-Jul-18

IATF 16949

13-Jun-18

ISO 9001

21-May-99

IATF 16949

17-Apr-18

IATF 16949

12-Jun-18

ISO 9001

20-Feb-07

IATF 16949

20-Jan-16

NOK (Wuxi) Vibration Control China Co., Ltd.

IATF 16949

15-Mar-19

NOK (Wuxi) Water Treatment Technology Co., Ltd.

ISO 9001

29-Oct-20* This list covers establishments engaged in seal production among overseas group companies.

39

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society​​

GovernanceCoexistence with Local Communities and Society
Basic Concept
In the NOK Group Charter of Corporate Behavior, weclearly state that “As a good corporate citizen, we will
actively participate in communities and contribute to theirdevelopment.” The local community is a key stakeholder
for the NOK Group. As a good corporate citizen, we valuecommunication with our local community so that we cangrow together. We strive to be loved and trusted, and to be

seen as a source of pride. The NOK Group also focuses on
nurturing and supporting the next generation, who will
shape the future.
As part of our social contribution efforts, we alignour activities with the NOK Group’s philosophy and ourcriteria for funding social contribution activities. We selectactivities mainly in our key focus areas.

〈Key Focus Areas〉
・Activities that contribute to the sustainable development of the communities in each country and region where NOKGroup offices are located・Training and supporting the next generation
Focus areas

Examples of activities

Health, medicine, sports

Participating in blood donation events, sponsoring sports, health, and well-being events, supporting anddonating to school sports events, Ecocap bottlecap recycling activities

Academic, research, education

Accepting interns, granting scholarships, supporting events for next-generation development and school events

Crime prevention, disaster prevention

Participating in and donating to crime prevention and traffic safety activities, participating in disaster prevention
activities, visiting victims after disasters

Local community activities,
conservation of traditional culture

Donating road safety goods to local governments, sponsoring local festivals, making donations to shrines,
donating goods to local communities, inviting local residents to festive events at the plants

Environment

Participating in local cleanup activities, tree planting activities, groundwater protection activities, recycling activities

Social welfare

Donations to the Red Cross and other social welfare organizations

Promotion Framework
At NOK, we have established funding the criteria for social
contribution activities, and base our decisions on theseguidelines. The administrative and operations departments
at each site choose the main themes for implementation.
They then present these to an advisory committee chaired

Initiatives

Contribution to the Local Community

The NOK Group regularly carries out local cleanup
activities at its offices in Japan and overseas. We also
focus on community-based activities, such as sponsoring
local festivals and inviting local residents to events at
our facilities. Each year, employees at NOK’s Kumamoto
plant join volunteer efforts to preserve and restore
the Aso grasslands. They also support groundwater
recharge projects. These actions help protect the naturalenvironment and water resources, contributing to the
local community.

40

by the Group CEO, which decides on the activities. The
local community contributions of each business site
are tabulated each year by numbers of participants andamounts spent. This data is then reported in the integrated
annual report and the ESG data book.

Activities to Develop and Support the Next Generation

The NOK Group works to develop and support the next
generation in several ways. We offer plant tours for students
and local residents, and they conduct outreach classes. In
FY2023, our manufacturing subsidiary TVC Co., Ltd. held an
event called “Parent-Child Open School: Have Fun Learning
about SDGs and TVC” to highlight its SDG efforts. A total of
63 people took part, including 48 children.

NOK CORPORATION ESG Data Book 2024

Basic Information

Society​​

Environment

Item

Scope of coverage

Unit

FY 2019

Governance

FY 2020

FY 2021

FY 2022

FY 2023

Composition of Employees
Regular employees

Number of
employees by
employment type

Number of
employees by region

Non-regular employees
Totalpersons
persons

Non-regular employees

Consolidated

personsJapan

persons

China
Southeast Asia

persons
Consolidated

persons

Total

personsMalepersons

Total

Non-consolidated

Male
Femalepersons
Consolidated

persons
persons％%

Age 30s
Age 40s

persons
persons％

Percentage of female employees

Age 20s and under%
Non-consolidated%

Age 50s%

Age 60s and over%Age 20s and under%Age 30s%

Age 40s
Age 50s

Major domestic groupcompanies%%

Age 60s and over

%

Male

age

FemaleNon-consolidated

Total
Male
FemaleTotal

Major domestic groupcompanies

Male
Total

age
age
age
years

Non-consolidated

Total
Female

age
age

Male
FemaleAverage length ofcontinuous service

persons

Europe and the United States

Percentage of female employees

Average age

persons

Total

Total

Employee ratio by age

persons

Regular employees

FemaleNumber of
employees bygender andpercentage of
women

persons
Non-consolidated

years
years

Major domestic groupcompanies

years
years
years

3,529
389
3,918
40,492
2,726
43,21811,001
10,913
17,395
1,183
40,492
2,747
782
3,529
22.2
—
—
—
—
22.1
27.5
29.6
20.5
0.3
—
—
—
—
—
40.1
40.1
40.1
—
—
—
17.1
19.3
17.6
—
—
—

3,676
389
4,065
37,9992,388
40,387
11,017
9,383
16,194
1,405
37,999
2,857
819
3,676
22.3
—
—
—
—
20.7
27.3
29.1
22.4
0.4
—
—
—
—
—
40.3
40.4
40.3
—
—
—
17.3
19.5
17.8
—
—
—

3,489
398
3,887
37,6132,300
39,913
10,7309,690
15,623
1,570
37,613
2,704
785
3,489
22.5
—
—
—
—
19.6
27.2
27.1
25.5
0.5
—
—
—
—
—
40.9
41.2
41.0
—
—
—
17.8
20.0
18.3
—
—
—

3,419
401
3,820
37,913
2,285
40,198
10,64810,65915,196
1,410
37,913
2,643
776
3,419
22.7
—
—
—
—
18.8
26.5
25.7
28.5
0.5
17.8
25.7
26.8
29.0
0.6
41.1
42.0
41.3
41.3
41.4
41.3
17.9
20.7
18.5
17.5
19.3
17.9

3,337
412
3,749
38,097
2,295
40,392
10,683
11,006
15,225
1,183
38,097
2,572
765
3,337
22.9
21,186
16,911
38,097
44.4
17.9
27.5
24.6
29.5
0.6
17.1
26.9
25.9
29.5
0.6
41.1
42.5
41.4
41.2
41.8
41.3
17.8
21.2
18.6
18.1
20.6
18.7

92
25
117
—
—
—
98
26

30
11
41
—
—
—
47
22

68
12
80
80
16
96
88
22

56
17
73
76
22
98
88
24

Hiring and Turnover

persons

117
34
151
—
—
—
134
42

Total

persons

176

124

69

110

112

Male

persons

—
—
—

—
—
—

—
—
—

113
30
143

123
32
155

Male
FemaleHiring of new
graduates

persons
Non-consolidated

Total
Male
FemaleTotal

persons
Major domestic groupcompanies

Male

Number of new hiresby gender(total of new graduatesand mid-career hires)

FemaleFemaleTotal

persons
persons
persons
persons
persons

Non-consolidated

Major domestic groupcompanies

41

persons
persons

NOK CORPORATION ESG Data Book 2024

Basic Information

Item

Number of new hiresby age group(total of new graduatesand mid-career hires)

Scope of coverage

Unit

—

—

—

8.3

9.2

Non-consolidated%

Consolidated

%

—
1.0
—
—
—
—

—
1.8
—
—
—
—

—
1.7
—
—
—
—

—
2.3
—
—
—
—

898,000
4.1
11.5
2.0
10.5
4.4

—

—

—

—

3.0

—
—
—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—
—
—

4.1
2.7
2.6
2.7
3.9
2.6
1.5
0.7
3.7
2.2
1.3
0.8

%

132.9
—
134.2
—

132.6
—
133.7
—

128.1
—
129.2
—

123.6
116.4
124.3
71.8

122.3
115.5
122.5
74.2

%

—

—

—

75.3

77.0

%

—

—

—

55.4

65.6

1,103
13,992

1,027
15,763

1,524
17,512

8,383
22,9401,650
19,145————

72,108

—

—

—

—

4.0

—
—
—

—
—
—

—
—
—

—
—
—

14,89518,004786,347

—

—

—

—

405,251

—

—

—

—

19.5

%

0.8

0.5

0.3

1.7

2.3

persons
Major domestic groupcompanies

Overall rate of turnoverRate of turnoverRate of voluntary turnoverRate of turnover bygender(Overall rate of turnover)Non-consolidated%

Consolidated%

Non-consolidated

Total
Male
FemaleTotal

Major domestic groupcompanies

Age 20s and underAge 30s
Age 40s

persons
persons

Non-consolidated

Male
Femalepersons

％

％

％

％

％

％
%

Non-consolidated%%

Age 50s%

Age 20s and under%Age 30s
Age 40s

Major domestic groupcompanies

Age 50s

%
%
%

—
—
—
—
—
—
—
—
—

55
12
2
0
—
—
—
—
6.5

85
19
6
0
111
21
11
0
7.8

85
21
4
2
114
33
5
3
7.6

%

persons
persons

Age 20s and under

Average employment cost

FY 2023yen

Non-consolidated

Age 50s and over

Ratio of senior management hired fromregional communities

FY 2022

Non-consolidated

persons

Age 40s

FY 2021%

Age 30s

Age 30s

FY 2020

Major domestic groupcompanies

persons

Age 40s

FY 2019

Governance

—
—
—
—
—
—
—
—
—

Age 20s and underAge 50s and overRate of turnover by age(Overall rate of turnover)Society​​

Environment

Remuneration
Fukushima

Ratio of standard entrylevel salary to regional
minimum wage
Employee genderwage gap(percentage for female
if men=100)

IbarakiKumamoto

Major production sitesof NOK and MEKTEC

All employees
Of which regular
employees

Non-consolidated

Of which part-time andfixed-term employees%%%

Investment in Human Capital

Human resource
development
programs*1

Investment in humanresource development(including humanresource development
programs)*2

Total number of participants

persons

Total training hours

hours

Total training cost

Major domestic groupcompanies

Training hours per person

thousandsof yenhours/
persons

Training cost per person

yen/persons

Total number of people

persons

Total hours
Total staff training costs

hours

Consolidated

Hours per person

thousandsof yenhours/
persons

Diversity
Percentage of management
positions held by women
Percentage of upper management
positions held by women

Major domestic groupcompanies
Overseas groupcompanies

%

28.1

30.0

35.7

32.1

30.9

Consolidated

%

—

—

—

26.9

18.2

Consolidated

%

—

—

—

—

15.9

*1 Tiered education and training/specialized education exclude ISO-based quality, environment, and safety education and training implemented since FY2023 such as Purpose andValues training.
*2 Includes human resource development programs, Purpose and Values training, etc.

42

NOK CORPORATION ESG Data Book 2024

Basic Information

Society​​

Environment

Item
Percentage of lower management positions
held by women
Percentage of management positions in revenuegenerating functions (sales, etc.) held by women

Scope of coverage

Unit

Consolidated%—

Consolidated

FY 2019

Governance

FY 2020

FY 2021—

FY 2023

FY 2022
—

—

19.0

%

—

—

—

—

19.9

%

—

9.8

9.8

11.3

%

—

0.3

0.3

0.3

%

—

—

—

12.3

%

—

—

—

0.3

12.8
0.3
13.3
0.3

Non-consolidated

%

—

—

—

20

23

Male

Non-consolidated(Leave-taking rate)

persons (%)

1

2

5

24 (21.8)

46 (40.0)

FemaleNon-consolidated

persons

60

47

30

32

34

%

%

—
—
0
0
209
6
2.06

—
—
1
0
212
10
2.03

100
100
1
0
221
12
2.15

100
100
2
0
183
12
2.56

100
100
1
0
191
15
2.71

%

—

—

—

0.71

0.75

2,041.7

1,953.0

2,006.8

1,997.3

1,972.4

205.8

117

183.2

180.7

162.5

day/persons

14.5

14.5

16

16.9

17.8

Major domestic groupcompanies

sessions

16

17

16

17

18

Major domestic groupcompanies

cases

—

—

—

—

0

—

1.20

1.21

1.31

1.25

1.29

—

0.27

0.21

0.28

0.35

0.3

—

0.100

0.070

0.060

0.080

0.080

—

Mid-career employees

Ratio of mid-career
Non-consolidated
and foreign-national Foreign-national employees
employees in
Mid-career employees
Major domestic groupmanagerial positions
companies
Foreign-national employees

Percentage of women aspiring to careers inleadership and professional positions
Human Resource and Welfare System
Number of
employees who tookchildcare leave

Male

Rate of return-to-workafter childcare leave

FemaleMale

Number of employees who
took nursing care leave

FemaleMale

Number of persons
reemployed

FemaleEmployment of disabled persons

Non-consolidated
Non-consolidated
Non-consolidated
Non-consolidated
Consolidated

Actual total hours worked

Hours worked per
Overtime worked
employee/Average(on an annual basis)
number of days ofannual paid leave taken Average number of days ofNon-consolidated

annual paid leave taken

Number of labormanagement
conferences held

Number of Central Labor
Management Councils held

Number of Labor Standards Act Violations%
persons
persons
persons
personshours/
personshours/
persons

Occupational Safety and Healthcare
Lost-time injury frequency rate*1

Severity rate*2

0.038

0.011

0.004

0.005

0.006

Employees

Consolidated

persons

0

0

0

0

0

Contract employees*4

Consolidated

persons

0

0

0

0

0

Safety, health, and wellness training
for line managers

Major domestic groupcompanies

persons

129

161

150

141

170

Equipment safety training

Non-consolidated

persons

Non-consolidated

Units

59
1,131

146
994

102
646

274
194

639
215

320

68

170

270

413

Deaths due tooccupational
accidents
Safety and
HealthTraining

Manufacturing industry*3(calendar year)
Major domestic groupcompanies
Manufacturing industry*3(calendar year)
Major domestic groupcompanies

No. of units undergoing facility safety improvements
Investment in facilities and equipment forsafety measures
Total number of employees commended for safe
driving (commended for 30 years or longer)
Number of health consultation calls

Non-consolidated

millions of yen

Major domestic groupcompanies

persons

910 (124)

908 (139)

963 (158)925 (146)

888 (116)

Major domestic groupcompanies

cases

—

850

715

552

443

Japan

％

ASEAN

％

％

—
—
—

—
—
—

93.3
84.3
72.2

91.5
84.7
77.3

90.4
89.7
80.1

Consolidated

millions of yen

116

82

81

119

114

Supply Chain Management
Breakdown of local procurement by region(by value)

China

Growing Together with the Community
Amount spent on social contribution activities*1 Number of casualties and rate of lost-time injuries and accidents per million working hours*2 Severity of injuries represented by the total number of workdays lost per 1,000 working hours*3 Ministry of Health, Labour and Welfare 2022 Occupational Accident Trend Survey*4 Including contractors

43

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

GovernanceCorporate Governance
Basic Concept
The NOK Group aims not only to contribute to thedevelopment of economic society by creating added value
through fair competition, but also to become a company
that benefits society at large by promoting managementthat can make all stakeholders proud of the company
and continue pursuing their dreams together. We arealso promoting a management plan to secure economic
growth with stability and strong increases in revenue overthe medium to long term.
For this reason, the NOK Group considers continuously
strengthening the corporate governance framework as
one of our business management priorities, and we arecommitted to this goal.

Corporate Governance System
In June 2024, NOK adopted a Company with an Audit
and Supervisory Committee system. In a fast-changing
business environment shaped by new technologies andshifting user needs, we must design and offer products andservices with the customer in mind. To achieve this, weneed efficient and agile business execution based on quick
decisions. Furthermore, to better delineate the roles ofoversight and execution, we have adopted a Company with
an Audit and Supervisory Committee system. This allows

the Board of Directors to focus solely on decision-makingof key management policies and plans, and supervisingbusiness execution. We delegate some key businessdecisions to executive directors and further delegate
authority for execution to executive officers. This ensuresa clear separation of oversight and execution and allows
for quick decision-making. Our Audit and Supervisory
Committee, composed of a majority of external directors,
oversees business execution from a neutral standpoint.
This ensures a governance system that balances flexible
business execution with effective monitoring. Our Audit
and Supervisory Committee consists of five directors,
including four external directors. A full-time Audit andSupervisory Committee member serves as the chair.
To enhance the objectivity and transparency of
executive nominations and remuneration, and toaddress other key management issues, we establisheda Nomination and Remuneration Advisory Committee
in June 2024. This committee serves as an advisory
body to the Board of Directors. The Nomination andRemuneration Advisory Committee consists of a chair anda majority of independent external directors. It regularly
reviews and advises on crucial matters such as executive
nominations and compensation, providing appropriate
guidance to the Board of Directors.

Diagram of Corporate Governance System
Shareholders’ Meeting
Appoint/Remove
Consult

Nomination andRemuneration
Advisory Committee

Board of Directors
Directors(Executive: 4 Internal
Directors)

Report• I nstructions to execute
management policies and plans• Appoint/Supervision• Request for reporting

Appoint/Remove

Appoint/Remove
Audit/Supervise

Audit & Supervisory
Committee
Directors(Audit & Supervisory Committee Members: 1 Internal Director, 4 External Directors)• Reports for plans for importantbusiness execution• Reports for important businessexecution (consolidated, segments
and companies)

Audit/Report
DirectAudit/ReportGroup
Chief Financial
OfficerGroup
Chief Technology
OfficerIndependent Auditor

ReportNOK Chief Executive Officer (Group Chief Executive Officer)

Leading Function

Cooperation

Internal Audit Office

ReportCooperation

Business Function• • •Control

Chief
Executive
Officer, etc.

Chief
Executive
Officer, etc.

Sealing
Solutions

MEK

• • •

Management Committee• Sharing of management policies and plans• Discussion and monitoring of business execution• • •Finance/accounting/quality/environment/safety/information security, etc.

Compliance, risk/crisis management, etc.

44

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

Steps to Enhance Corporate GovernanceYear and month

PolicyPurpose2004

Apr. Established the Corporate Risk Management Office

2006

May Established the Basic Policy for the Internal Control SystemJul.

Established the Accounting and Audit Division

Established as the Internal Audit Unit

Enacted the NOK Charter of Corporate Behavior

Formulate basic policies for the internal control system
Enacted and declared Management Principles, Management Policies, andPrinciples of Corporate Behavior

Aug. Enacted the Behavioral Guidelines on Employee Compliance
Compliance Rules established2007

Prevent and minimize negative impacts on business continuity

Enacted and disseminated guidelines on matters for employees to comply with
Provisions on the handling of compliance with laws and regulations andcompany rules and regulations

Mar. Established the Risk Management Rules

Provisions on responses to the occurrence of business risks and emergencies

Oct. Established the internal control subsidiary management rules

Prescribes instructions to subsidiaries and compliance by subsidiaries

Established the internal control rules for financial reporting

Prescribes methods for developing and evaluating internal controls overfinancial reporting

2008

Jan.

Established the Internal Control Audit Committee

Audit and maintain the state of the internal control system

2009

Jun.

Introduced the Executive Officer System

Separate management oversight and executive functions, and establish an
agile management framework

Changed the term of office of directors to one year

Separate management oversight and executive functions, and establish an
agile management framework

Revised the executive compensation system

Introduce a long-term performance-based and performance-linked
compensation system

2013

Jul.

Established internal control rules

Consolidate Internal Control Subsidiary Management Rules and other internal
control-related rules

2015

Jun.

Established the Risk Management Committee

Minimize risk probability and losses through cross-organizational verificationand evaluation

2016

Apr. Installed a whistle-blowing system (that covers domestic Group
Companies)

Created a whistle-blowing framework by establishing the Whistle-Blowing
Hotline (in and outside the company)

May Started assessing the effectiveness of the Board of Directors

Improve the effectiveness of the Board of Directors

Jun.

Strengthen the management oversight function

One external director took officeStrengthen the management oversight function

Increased the number of external directors to two

Oct. Established the CSR Committee

2017

2019

Raise the awareness of CSR throughout the company and promote effective
CSR activities

Established the Central BCM Committee

Increase the effectiveness of the business continuity plan and help to improve
corporate value

Seal Segment BCM Committee established

Build and maintain the BCM within the segment as a sub-organization of theCentral BCM CommitteeMar. Electronic Segment BCM Committee established

Build and maintain the BCM within the segment as a sub-organization of theCentral BCM Committee

Jan.

Established the Business Continuity Management Rules

Provides a business continuity management systemJul.

Established the Management Oversight Council (composed of
the President and Representative Director, external directors
and auditors)

Check, assess, and advise on key management issues and serious risks

Jan.

2020

Oct. Expanded the internal reporting system (China Group
companies excluding Taiwan and Hong Kong)

Strengthen the reporting framework by expanding the establishment of somewhistle-blowing desks at overseas bases

2021

May Established the ESG Committee

Promote the company’s continued sustainable growth and the implementationof responsible initiatives

2022

Mar. Expanded and introduced a whistle-blowing system (AsianGroup Companies outside mainland China)

Strengthen the reporting framework by expanding the establishment of somewhistle-blowing desks at overseas bases

Jun.

Established the Internal Audit Department

Established a specialized department for internal control audits

Formulated whistle-blowing regulations

Formulated regulations in compliance with the revised Whistleblower
Protection Act

2023

Apr. Formulated NOK Group Anti-Bribery and Anti-Corruption Policy
Formulated basic rules for bribery and corruption prevention
Jul.

2024

Changed our Risk Management Committee Structure

Took actions and reinforced framework for bribery and corruption prevention
Strengthened our systems to address risks throughout the Group

Oct. Established the Sustainability Committee

Promoted sustainability initiatives across the Group

Jun.

Transitioned to a Company with Audit and Supervisory
Committee system

Established a governance system that combines flexible business execution
and monitoring

Established Internal Audit Office

Established an Internal Audit Department under the direct control of the
President, independent of business execution divisions

Established Nomination and Remuneration Advisory Committee
Confirmation, evaluation, and advice on important issues and serious risks related(composed of a representative director and external director andto company management, such as nomination and remuneration of officers
chaired by an external director)

45

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

Remuneration of Directors
The Company has established the following basic policy
for determining the details of remuneration for directors.
Based on this policy, we determine remuneration within
the total amount approved by the General Meeting of
Shareholders. The Board of Directors decides remuneration

for directors who are not Audit and Supervisory Committee
members. Directors who are Audit and Supervisory
Committee members decide their own remuneration
through discussions among themselves.

Basic Policy

in which the amount varies according to the level ofachievement of KPIs related to the priority implementation
measures in the NOK Group’s medium-term management
plan. Together with monetary remuneration, which varies
according to the degree to which performance targets
are achieved in a single fiscal year, the goal is to increase
corporate value over the medium to long term and toenhance stakeholder satisfaction.

We believe in using remuneration to motivate themanagement team, including directors of our corecompanies, to achieve their goals. Through this approach,
we aim to enhance corporate value over the medium tolong term and increase stakeholder satisfaction. To thisend, we have in place a stock-based remuneration planfor the management of the NOK Group’s core companies,(As of June 30, 2024)

Composition of
the Directors

Unit

Gender

Total

Male

Internal/External
FemaleInternal

External

Directors

persons

9

8

1

5

4

Executive Officer*

persons

15

14

1

15

0

* Figures for executive officers do not include those concurrently serving as directors.

Board of Directors and Skills Matrix
Skills possessed
Officers

Directors
who are not
Audit andSupervisory
Committee
members

Years in
Genderposition

Name

Masao Tsuru

Male

4

Akira Watanabe

Male

11

Junichi Orita

Male

3

Yuki SatoMale0

Hideki Watanabe*1

Male

4

External

Male

8

External

Male

2

External

female0

Atsushi Kajitani*1 External

Male

8

Directors who Makoto Fujioka
are Audit andNaoki ShimadaSupervisory
Committee
members
Motoko Imada

Financial,
Compliance/
Business
Corporate
Group
Technology
New(production/sales)
Sustainability
accounting, andRiskstrategy
management strategy
businessstrategy
capital policies
management
○

○

○

○

○
○

○

○
○
○

○

○
○

○

○
○
○

○

*1 F
 or Mr. Hideki Watanabe and Mr. Atsushi Kajitani, directors who are Audit and Supervisory Committee members, the number of years of service shown includes the period during
which they were auditors.
*2 The above list shows up to two areas specifically expected of each person, and does not indicate all areas of their knowledge or experience.

46

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Item

Representative Director

Composition of Management
Directors
Oversight Council (advisory bodyfor nominations, remuneration, etc.) External Directors
External Auditors
Management Oversight Council(advisory body for nominations,
remuneration, etc.)

Number of Management
Oversight Council meetings held
Average attendance rate

GovernanceSociety

Unit

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

persons

2

2

2

2

2

persons

0

0

0

0

0

persons

2

2

2

3

persons

1

1

1

ー

ー

sessions

2

2

2

2

2

3

%

100

100

100

100

100

Directors

persons

8

9

9

9

9

Of which, the number of external directors

persons

2

2

2

3

3

Of which, the number of female directors

persons

0

0

0

0

0

Auditors

persons

5

5

5

5

5

Of which, the number of external auditors

persons

3

3

3

3

3

Of which, the number of female auditors

persons

0

0

0

0

0

Board of Directors

Number of board of directors’ meetings
held (held on paper)sessions

13 (2)

14 (2)

12 (0)

13 (1)

14 (1)

%

98.2

100

99.1

100

98.2

Board of Statutory Auditors

Number of board of statutory auditors’
meetings held

sessions

9

12

11

11

12

%

97.8

98.3

100

98.2

100

millions of yen

289

317

406

393

366

Composition of Board of Directors

Composition of Board of Statutory
Auditors

Average attendance rate

Remuneration of Directors andAuditors*1
Auditor Remuneration*2

Average attendance rate
Directors
Of which, the number of external directors

millions of yen

12

11

14

25

30

Auditors

millions of yen

59

60

67

75

80

Of which, the number of external auditors

millions of yen

18

17

17

27

30

*1 The directors’ remuneration for FY 2019 includes remuneration granted to a board director who stepped down as a director as of October 31, 2019.
The directors’ remuneration for FY 2021 includes remuneration for one auditor who retired from the position of board director at the conclusion of the 115th Ordinary General
Meeting of Shareholders held on June 25, 2021.
The directors’ remuneration for FY 2022 includes remuneration for one auditor who retired from the position of board director at the conclusion of the 116th Ordinary General
Meeting of Shareholders held on June 24, 2022.
The directors’ remuneration for FY 2023 includes remuneration for one auditor who retired from the position of board director at the conclusion of the 117th Ordinary General
Meeting of Shareholders held on June 28, 2023.
*2 The directors’ remuneration for FY 2020 includes remuneration for two auditors who retired from the position of board director at the conclusion of the 114th Ordinary General
Meeting of Shareholders held on June 25, 2020.

Compliance
Basic Concept
The NOK Group established the Compliance Rules in2006, based on the NOK Charter of Corporate Behavior,
which stipulates compliance with laws and regulations
as well as the company’s various rules and regulations.
The company established the Behavioral Guidelines on
Employee Compliance as a guide for specific details of
the regulations. This document specifies the items that

employees must comply with in their business activities,
and we ensure that all Group employees familiarize
themselves with the Guidelines. If any complianceviolations are discovered, those involved will facedisciplinary action under Company rules. Their actions
will also affect their performance evaluations.

Behavioral Guidelines on Employee Compliance
1. R
 espect for Human Rights, Prohibition against
Discrimination and Harassment

7. Environmental Conservation

3. Regulations against Insider Trading

10. Appropriate Management of Information

8. Health and Safety

2. Fair and Appropriate Trade

9. Provision of Useful and Safe Products

4. Export/Import Procedures (Security Trade Control)
5. Laws Related to Intellectual Property Rights

6. Severance of all Relations with Antisocial Forces

47

11. P
 rohibition Against Acts that May Damage theCompany’s Interests
12. Reporting Violations of Ordinances, etc.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

Promotion System
At the NOK Group, the Risk Management Committee,
chaired by the Group CEO, decides compliance policies.
It also reviews compliance-related issues and problems.
Based on these policies and outcomes, the Compliance
Promotion Subcommittee, as part of the Risk Management
Committee, works to prevent legal risks globally across theGroup. It promotes compliance measures and considers
steps to prevent repeat legal violations, striving forthorough compliance.

Furthermore, to strengthen compliance across theGroup, each department in charge of specific laws andregulations promotes compliance activities in their areaof responsibility, based on the Compliance Rules. These
departments also serve as contact points for reportingand consulting on the relevant laws and regulations or oninternal rules and internal regulations.

Education
The NOK Group has designated every October as
Compliance Promotion Month. During this period, we
conduct a compliance awareness survey for all employees inJapan and oversees. We aim to regularly instill and reinforce
company compliance policies. The Company also provides
compliance education as part of the training for new

employees and newly appointed managers. We have creatededucational materials for all employees titled “Introduction
to Compliance” (in Japanese, English, Chinese, and Thai)and regularly distribute articles titled “an Encouragementof Compliance” to continuously promote awareness aboutcompliance.

Compliance education

Implementation period

TargetMeasure, purpose

New employees

Training for new employees

When joining Company (April)

Training for newly appointed
managers

Newly appointed Acquisition of compliance knowledge necessary for labor
When appointed (twice a year)
managers
management

Acquisition of basic compliance knowledge

Management training forseconded employees

When seconded (once a year)

Newly seconded
Acquisition of internal control and compliance knowledge
officers

Group legal training

Once a year

Group company
officials

Compliance Promotion Month

Every October

All group officers Education via compliance primers and educational databasesand employees Compliance awareness surveys, comprehension tests, etc.

Four times a year

All group officers Acquisition of knowledge on laws and regulations by theme andand employees improvement of compliance awarenessDistribution of compliancearticlesAcquisition of compliance knowledge required for work

Reporting Desk and Whistle-Blowing Hotline
The NOK Group has established the NOK Group Reporting
and Consultation Desk and Whistle-Blowing Hotline
to detect and correct illegal conduct that violates theCompliance Rules at an early stage.
NOK Group employees can contact the Reporting andConsultation Desk if they notice an illegal act or violation
or if they are unsure whether an action counts as anillegal act or violation. If the violation continues evenafter the report to the Reporting and Consultation Desk or
if it is difficult to report there, we have established systemthat employees can contact the Whistle-Blowing Hotline.
The Whistle-Blowing Hotline consists of the internal
contact (Legal Affairs Department) and independent48

lawyers. Reports can be made anonymously, if they
are objective and specific. Moreover, the whistleblower is protected against disadvantageous treatment
under Whistle-Blowing Rules. Whenever a report orconsultation is received, the Company takes appropriate
action, such as investigating and correcting the situationin question.
Regarding overseas sites, the Whistle-Blowing Hotline
was set up (in and outside of the company) at 12 Group
companies in China. Furthermore, we expanded andestablished whistle-blowing hotlines at 32 Group companies
in the rest of Asia to strengthen our whistle-blower system.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society

GovernancePrevention of Corruption and Bribery
The NOK Group declares in NOK Charter of Corporate
Behavior that it will maintain "fair, transparent, andfree competition, appropriate business transactions,and sound and normal relations with political andadministrative authorities,” and that corruption andbribery are prohibited. As a signatory to the United
Nations Global Compact, the NOK Group respects theTen Principles of the United Nations Global Compact
and has established the NOK Group Policy on Preventionof Corruption and Bribery to further promote measures
to prevent corruption and bribery. In the event of aviolation of the Group’s anti-corruption policy, the Risk
Management Committee is primarily tasked with taking
response measures. Our Whistle-Blowing Hotline also
accepts information on violations of anti-corruption rules.
Once a year, the Internal Control Audit Committee
conducts an anti-corruption audit of all domestic andinternational divisions and Group subsidiaries. Based on
the results of each audit, it identifies any anti-corruption
risks in the business and reports its findings to the Boardof Directors.

NOK Group Policy on Prevention of Corruption and Bribery

12Compliance with Laws and Regulations
We will observe laws and regulations prohibiting bribery (hereinafter referred to as "bribery related laws and regulations") in theperformance of group duties in the countries and regions concerned.

Prohibition of Provision or Receipt of Illicit Profit
We will not engage in any acts (including facilitation payments) that are prohibited by bribery related laws and regulations for the
purpose of obtaining illicit or unfair profits, regardless of whether domestic or foreign, directly or indirectly, public officials, private
citizens, or private companies.

3

Prohibition of Bribery Through Third Parties

4

Proper Accounting and Record Management

5

Education and Training

6

Effective Operation of the Whistle-Blowing System

7

Risk Assessment and Review

8

Monitoring and Continuous Improvement

We will prevent bribery through third parties and will not tolerate such acts by appropriately managing business relationships withthird parties, such as agents and consultants.

We will keep accurate and factual accounting books and other records for all transactions related to this policy, perform
appropriate accounting procedures, and properly maintain these records.

We shall provide education and training on the prevention of corruption and bribery for officers and employees to thoroughly
inform them of the purpose and content of this policy.

We will establish a contact point for consultation and reporting for when we recognize an act that violates or may violate this policy,
and we will use this contact point to prevent, detect early, and correct the act in question.

We will periodically assess risks of corruption and bribery, handle high-risk business activities in a focused manner, and review thispolicy and responses based on this policy as necessary.

We will monitor the status of compliance with this policy and internal rules concerning the prevention of corruption and bribery,
and make continuous improvements based on the results.
Enacted on April 1, 2023

49

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Item

GovernanceSociety

Scope of coverage

Unit

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

Serious legal violations

Consolidated

cases

0

0

0

0

0

Amount of fines for legal violations

Consolidated

yen

0

0

0

0

0

Anti-corruption violations

Consolidated

cases

0

0

0

0

0

Amount of fines for anticorruption violations

Consolidated

yen

0

0

0

0

0

Violations of the Code of Conduct other than above

Consolidated

cases

6

8

4

4

10

Number of cases relating to human rights
violations and harassment

Consolidated

cases

0

0

1

2

3

Number of cases relating to privacy(including customer personal information)

Consolidated

cases

0

0

0

0

0

Number of cases relating to conflicts of interest

Consolidated

cases

0

0

0

0

0

Number of cases relating to insider trading

Consolidated

cases

0

0

0

0

0

OthersConsolidated

cases

6

8

3

2

7

Scope ofcoverage

Unit

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023

Lobbying activities

Consolidated

yen

0

0

0

0

0

Political activities

Consolidated

yen

0

0

0

0

0

Other political contributions

Consolidated

yen

0

0

0

0

0

Scope ofcoverage

Unit

FY 2023

Keidanren Japan Business Federation

Consolidated

yen

3,300,000

Japan Auto Parts Industries Association

Consolidated

yen

3,900,000

Tokyo Employers’ Association

Consolidatedyen

1,120,000

Spending on political organizations

Main spending on politicalorganizations (annual fees)

Risk Management
Basic Concept
NOK’s Risk Management Regulations stipulate the basic
policy and management framework for risk management
across the entire Group. Based on these regulations, wehave established a Risk Management Committee chairedby the Group CEO to promote risk management for theGroup. There are two types of business risks that may
affect the management of the Company: business strategy
risk, in which we maximize returns while balancing risks
to enhance corporate value; and the risk of loss, in which
we seek to prevent or minimize the probability of losses
occurring to maintain corporate value.
For business strategy risks, the Risk Management
Committee meets three times a year to identify such risks

50

in group company operations and new ventures. The
committee discusses these risks in monthly management
strategy meetings so that returns can be maximized in atimely and appropriate manner. For risk of loss, the Risk
Management Committee has a subcommittee called
the Risk and Crisis Management Subcommittee. This
subcommittee meets twice a year to identify and analyze
such risks across the group. It then quantifies these risks
by evaluating their frequency of occurrence and scale ofdamage assesses their importance and urgency, and ranks
them in order of priority. Finally, it reviews actions andmeasures that are needed.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

Risk Management Framework
Management and Supervisory Bodies
Board of Directors
ReportBusiness Execution Bodies

Guide and Supervise

Risk Management Committee
Business Strategy
Risk Management

DirectCheck and Evaluate

ReportReportManagement Committee

Risk of Loss
Management

Risk and Crisis Management Subcommittee

Refer for Discussion

ReportLeading Function (Business Execution Division)

Business Function (Business Execution Division/ Subsidiaries)

Thorough Awareness
Finance, accounting, quality, environment, safety,
information security, etc.
ReportCompliance, risk/crisis management, etc.

Crisis and Risk Categories That May Significantly Impact Company Management
Risks of loss are categorized as follows based on the type of crisis that may significantly impact company management andits cause.
Type of crisis

Cause

Risk category

Fire, explosion
Natural disasters (earthquakes, floods, volcanic eruptions, etc)
Illness (COVID-19, H1N1 influenza, SARS, etc.)
Shutdown of operations

Suspension of materials supplies
Cyberattacks•Disaster risk
•Credit risk•Country risk

Unlawful obstruction of business
Disruption of critical infrastructure
Judicial risk (crime, profit sharing, etc.)
Taxation (violation of tax laws, etc.)
Legal violations, etc.

Companies Act, Financial Instruments and Exchange Act (shareholder derivative lawsuits, etc.)
Environment (pollution, etc.)•Legal risk
•Credit risk

Labor laws (violation of Labor Standards Act, harassment, etc.)
Industrial accidents
Employee death, serious injury,or the possibility thereof

Traffic accidents
Natural disasters (earthquakes, floods, volcanic eruptions, etc.)
Fire, explosion•Disaster risk•Country risk

Overseas armed conflict, riots, terrorism, kidnapping, etc.
Lawsuits
Other matters that significantly
impact company management•Legal risk
Loss, leakage of key confidential information•Credit risk

Serious quality issues•Credit risk

Other

•Various risks

51

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society

GovernanceBusiness Risks
1. Business strategy risk

Strategic risk

(1) Dependence on customer performance
The bulk of the Group’s business is the manufacture and sale of seal products and electronic products. In these fields, our major clients areleading domestic and foreign manufacturers of automobiles, construction machinery, and electronic devices. Sales to such client companies
may be affected by factors beyond the Group’s control, such as the companies’ business performance and unforeseen changes in contracts.
A decline in sales to such customers may affect the Group’s operating results and financial position. The Group aims for a balanced customer
portfolio and strives to minimize the risk of sales declines to client companies.
(2) Alliances with other companies
The Group engages in various alliances with other companies in developing its business. However, the Group’s operating results andfinancial position may be affected by factors beyond its control, such as the dissolution of such alliances due to the peculiar circumstancesof alliance partners.
In particular, since 1960, the Company has been in a capital and technical alliance with Freudenberg in Germany. Freudenberg (including its
group companies) has played an important role as a partner company in the business development of our Group.
Freudenberg is currently our largest shareholder, holding 25.1% of outstanding shares of the Company through its investment arm,
Freudenberg S.E. The Group recognizes that its alliance with Freudenberg will remain stable going forward. However, should there be a change inthe relationship with Freudenberg or Freudenberg’s business strategy or some other change, this may affect the business of the Group.

Investment risk

(1) Impact of changes in demand trends
Oil seals and other mainstay products of the Group are primarily used in internal combustion engines. Fuel cell and electric vehicles have also
entered the automotive market in recent years. Anticipating the future spread of such vehicles, the Group is also promoting R&D into new
products that can be installed in the vehicles. At present, however, it is difficult to foresee the impact that the spread of fuel cell and electricvehicles will have on the Group’s operating results and financial position.
Moreover, as the trend toward the commoditization of automobiles, construction equipment, electronic device products, and officeequipment grows, the number of local manufacturers in emerging countries has increased. Going forward, mounting competition may cause
prices to decline, which may affect the Group’s operating results and financial position.
(1) Impact of exchange rate fluctuations
With overseas sales accounting for roughly 70% of Group consolidated net sales in the fiscal year under review, exchange rate movements invarious regions may affect the Group’s operating results and financial position. For this reason, we hedge risks by means of foreign exchange
forward contracts. However, as such contracts do not necessarily avoid exchange rate risks entirely, exchange-rate fluctuations may have an
impact on the Group’s operating results and financial position.

Market risk

(2) Impact of interest rate fluctuations
The Group raises funds in consideration of the need for funds, the means of funding, and financial conditions. Fluctuations in interest rates onfunding stemming from changes in financial conditions may affect the Group’s operating results and financial position.
(3) Impact of stock market trends
Domestic and overseas stock market trends affect the valuation of investment securities held by the Company and the investment statusof the Group’s pension assets. A downturn in the stock market could subject investment securities to valuation losses, cause a decrease inpension assets, and increase the Company’s burden.
(4) Fluctuations in raw materials costs
The costs of steel sheets, synthetic rubber, copper foil, resin films, gold, and other products that are the main raw materials for Group
products fluctuate in line with supply and demand. As these fluctuations in raw materials costs are not always immediately reflected in productprices, they may affect the Group’s operating results and financial position. Given such fluctuations in raw materials costs, the Group is seeking
a broad range of business partners in Japan and worldwide to ensure a stable, continuous supply of raw materials.

2. Risk of loss

Legal risk

(1) Impact of legal regulations
The Group is subject to various laws and regulations in the various countries where it operates. We are working to develop internal regulations andmanuals that conform to such laws and regulations, foster and thoroughly instill awareness of compliance through various types of education, andbuild a framework for collaboration with outside experts. However, if such laws and regulations are revised or made more stringent going forward,
the additional costs incurred in complying with new regulations may affect the Group’s operating results and financial position.
(2) Risks related to lawsuits and other legal proceedings
When doing business in various countries, the Group establishes frameworks for Group internal control and collaboration with outside
experts and hedges risks by taking out various types of insurance. However, we may become a party to lawsuits, regulatory action, or otherlegal proceedings. If fines or restrictions on business execution are exacted on the Group as a result of such proceedings, this may affect theGroup’s operating results and financial position.

52

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society

Governance2. Risk of loss

Legal risk

(3) Impact of intellectual property infringement
The Group guards its proprietary technology by obtaining patent rights and other intellectual property rights, and is also attentive topreventing infringement on the intellectual property rights of third parties. However, if the inability to adequately guard the Group’s intellectual
property rights due to factors such as disparities in country circumstances results in lower sales or in litigation costs, or if Group products
unintentionally infringe on the intellectual property rights of other companies, resulting in the need to suspend sales or pay remuneration,
this may affect the Group’s operating results and financial position.
(4) Impact of environmental regulations
The Group complies with environmental laws and regulations at its various sites and takes necessary measures to address the environmental
demands of customers. In the future, however, laws and regulations or customer demands may become more stringent, the Group may bear
additional environmental responsibilities, and business activities may be restricted. If responding to such developments incurs a sizable cost,this may affect the Group’s operating results and financial position.

Countryrisk(1) Political and economic conditions
The Group operates in Japan, North America, Europe, China, and other Asian countries. Therefore, shifts in political and economic conditions in
the countries and regions where the Group manufactures and sells products may affect the Group’s operating results and financial position.

Disaster risk

(1) Natural disasters, etc.
The Group’s production and distribution activities may be hindered by earthquakes, typhoons, floods, volcanic eruptions, and other natural
disasters, fires and other accidents. To prepare against such eventualities, we are striving to minimize business continuity risks by decentralizing
production sites and putting safety measures in place. We also hedge risks by means of various types of insurance. However, it may not be
possible to entirely prevent or mitigate the occurrence of such events, which may affect the Group’s operating results and financial position.
(2) Infectious diseases, etc.
To prepare against situations in which an outbreak of infectious disease or other pandemic hinders production and transportation activities,
the Group is striving to minimize business continuity risks by decentralizing production sites and putting safety measures in place.
In particular, we have taken various measures to minimize the impact of COVID-19 since its global outbreak in 2020. Measures include
drafting a response manual, allowing employees to work remotely and follow staggered working hours, and using remote working tools tocreate an environment where work can continue. There are signs that the pandemic is subsiding, as countries reassess their handling of
the disease. However, if there is a resurgence in new infections or the pandemic is prolonged, the economic or business environment of theGroup may deteriorate, which may affect the Group’s operating results and financial position.
(1) Impact of information leaks
In the conduct of business, the Group comes into possession of technical information, personal information, and other confidential
information. We have established an internal framework and procedures to prevent leaks of such information. However, in the event that
information is leaked due to unforeseen circumstances, this may affect the Group’s operating results and financial position.

Credit risk

(2) Impact of cyberattacks, etc.
The Group makes use of outside organizations and other resources to investigate and implement preventive measures against operational
shutdowns, loss of key data, and information leaks due to malicious cyberattacks. However, cyberattacks using unknown methods may affectoperations.
(3) Impact of product quality issues
The Group manufactures products in accordance with globally recognized quality control standards at its various production sites. However,entirely eliminating product quality defects due to unpredictable causes is difficult. In the event of a product defect that leads to a large-scale
recall or product liability, the significant cost of the response and the loss of social credibility may affect the Group’s operating results andfinancial position.

53

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

Society

Governance

Responding to Disaster Risk
1. Business Continuity Management (BCM) System

responsible for formulating, maintaining, and updating
the business continuity plan (BCP), securing thebudget and resources to implement it, implementing
preventative measures, conducting education andtraining, conducting inspections, and engaging inongoing activities.
In the event of an emergency, the Company must
immediately set up an emergency response headquarters
at the head office and on-site response headquarters at
local business establishments. Depending on the situation,
relevant departments and divisions will work together todeal with the situation promptly and appropriately.

Composition of BCM Committee

2. P lanning and Promoting
Business Continuity Plans (BCP)

Regarding business risks and emergencies, NOK defines
natural disasters, fires, explosions, serious accidents andepidemics of infectious disease as “events that interfere withbusiness continuity.” The company established the BusinessContinuity Management System to ensure business
continuity and to promote business continuity activities
consistently and effectively should such an event occur.
Specifically, the NOK Group BCM Committee wasestablished as a standing committee to promote business
continuity management activities. The management
framework consists of the BCM Committee, which isCentral BCM Committee

NOK will proceed with business continuity measures
based on the following basic policy.

Segment BCM Committee
Seal
Business

Electronic
Products Business

1. Give top priority to protecting people, saving people's
lives, and ensuring safety.

Other
Business

2. As a member of the local community, actively
cooperate with the recovery of the whole region.
3. M inimize the impact on customers and other stakeholders,and fulfill responsibilities as a business operator.

Sub-committee in Segment
Sub-committee by organization(by business division and location)
Sub-committee by function (cross-functional)* A sub-committee is established in each segment’s BCM Committee

Each business site, including domestic and overseas
Group Companies, has a plan that outlines policies,
systems, and procedures to ensure that important business
operations are not interrupted or, if they occur, to berestored as quickly as possible if an unforeseen event
should occur. At the same time, the Company verifies theplan’s effectiveness through training and responding to
identified issues. It also continues to implement measures
to minimize damage, improve emergency communication
methods and reporting systems, and reinforce theearthquake resistance of our IT infrastructure. We arealso working with suppliers to strengthen the business
continuity of our supply chain BCM.

ESG Assessment for New Businesses and Projects
We recognize that when planning new businesses or
projects, we need comprehensive evaluations that include
ESG perspectives. Besides financial and tax assessments,
we look into the corporate culture and business model. We
also conduct due diligence focused on ESG factors: climatechange, human rights, labor problems, workplace safety
and health, compliance, and anti-corruption. We move54

ahead only after confirming there are no issues.
Before Estoh Co., Ltd. became a subsidiary in Octoberlast year, we conducted due diligence and confirmed
there were no problems.

NOK CORPORATION ESG Data Book 2024

Basic Information

Environment

GovernanceSociety

Information Security Measures, Cyber Security Strategy
The NOK Group views the leak of customer and personal
information and the threat of sophisticated cyberattacks assignificant risks. The Risk Management Committee, chairedby the Group CEO and vice-chaired by the Group CFO, andcomposed of senior management, addresses these risks,
which we see as top priorities for management action.
Based on the results of the deliberations and the policy, we
advance countermeasures in a specialized department (theIT Division headed by the Group CIO).
In addition, having established an NOK Group
Information Security Policy, the Central Information
Security Committee, which is headed by the Group CIO,
and the information security committees establishedwithin each division and Group company systematically
implement response measures for their organizations.
The Information Security Management Regulations set
forth information security measures and management. They
also stipulate how to respond when an accident occurs.
If we detect an information security incident that could
lead to the loss or leakage of confidential information, we
follow the procedures in the Information Security Incident
Response Standards as we respond to prevent or mitigate
damage. In addition, any employees who violate these rules
and cause damage may be subject to disciplinary action

based on the employment rules.
For cybersecurity countermeasures, we base ourpolicies and strategies on the NIST CSF. We conduct a
range of planned activities including regular vulnerability
assessments and annual incident response drills.
Having launched NOKG-CSIRT in FY 2023, we
continue bolstering our cyberattack countermeasures.
At the NOK Group, our approach to security education
is guided by the belief that each employee’s security
awareness and skills are key. In FY 2023, we distributed
educational videos on the latest information security
trends and responses to targeted attack emails to
employees and conducted a questionnaire to check theirunderstanding. We also provide regular education on
IT knowledge and security information. Topics includeanti-virus measures and information management for
remote work.
Going forward, we will continue to implement a PDCA
cycle, striving to maintain and enhance information
security measures. In addition, we will actively participate
in joint measures to strengthen information security
measures for the entire supply chain outside the Group as
well, including those of industry groups.

Protection of Intellectual Property
The NOK Group has summarized key points regarding
intellectual property-related laws in the Behavioral
Guidelines on Employee Compliance and works to ensurethat all employees are aware of these points. In this way,
the Group seeks to apply for and acquire intellectual
property rights for our own inventions, as well as respects
the intellectual property rights of other companies andstrives to prevent infringements of others’ rights by

researching and identifying the patents belonging toother companies.
We have also set up an Anti-Counterfeit Committee
to protect NOK brands and are working to confront
counterfeiting overseas. In China, we are detecting plantsthat manufacture counterfeit products and removing
pages selling counterfeit products from online sales sites.

Anti-counterfeit Measures
Item

Unit

FY 2019

FY 2020

FY 2021

FY 2022

Exposing counterfeit product manufacturing sites

cases

4

3

9

8

6

Deleting online sales sites

cases

830

664

5,093

5,284

4,417

Domestic

cases

1,355

1,267

1,265

1,202

1,379

Overseas

cases

1,250

1,433

1,729

1,728

1,959

Total

cases

2,605

2,700

2,994

2,930

3,338

Domestic

cases

1,882

1,768

1,770

1,666

1,766

Overseas

cases

1,901

2,112

2,674

2,683

2,772

Total

cases

3,783

3,880

4,444

4,349

4,538

Patents held (non-consolidated)

Patents held (NOK Group)

55

NOK CORPORATION ESG Data Book 2024

FY 2023

Basic Information

Environment

GovernanceSocietyTax Policy
Basic Concept

3. C omplying with the Transfer Pricing Taxation

The NOK Group operates worldwide. We regard fulfilling
tax obligations in each country and region as a fundamental
and crucial social responsibility for any company. Based on
this view, we have established a tax policy and are working
to ensure transparency in tax matters.

1. Basic Policy

We conduct fair and appropriate business activities
globally based on the NOK Charter of Corporate Behavior
and our Behavioral Guidelines on Employee Compliance.
Regarding taxes, our tax department leads information
sharing with related department and engages external
experts like tax accountants for support. Through these
efforts, we ensure our compliance with tax laws andregulations in all countries and regions where we operate.
Should there ever arise any actions that deviate from tax
laws or any issues that suggest tax avoidance, we willpromptly correct them and ensure proper tax payments.

2. Appropriate Tax Payment

The countries and regions where the Group operates arechosen based on business needs. Tax burden is just one
factor among many. We do not choose locations mainly for
their low tax rates. We base our tax planning on the intent oftax laws and regulations in each country and region. While
we consider and implement plans that benefit cash flow andoptimize tax costs, we do not adopt abnormal tax structuresthat use entities without substance for tax avoidance.

Transactions between overseas affiliates of the Groupare conducted based on arm’s length price based on
the functions and risks of each site, based on the OECD
guidelines and the transfer pricing taxation of eachcountry.
In addition, we are preparing transfer pricing
documents in accordance with the tax systems of eachcountry. We are also working to reduce transfer price risks
through a system that verifies and corrects transaction
prices after the fact.

4. Complying with Anti-Tax Haven Rules

The Group does not use tax havens for the purpose of tax
avoidance. We properly file and pay taxes in the countries
and regions where we operate. When we need to operate
in low-tax countries for legitimate business reasons, weaccurately calculate the tax burden and assess economic
rationality based on economic activity standards. We reflect
these assessments in our tax filings as needed.

5. Relationships with Tax Authorities

The NOK Group responds earnestly to requests from tax
authorities in each country and region where we operate.
By providing accurate tax information, we strive to build
healthy relationships with these authorities. We also
implement measures to prevent recurrence of any issues
identified by the tax authorities.

Business Overview by Country/Region (FY 2022, consolidated)(100 million yen)

Number of
employees (persons)

Earnings

Earnings before
interest tax

Japan

10,6484,595.5

122.4

12.8

115.4

China

10,6595,018.7

56.8

4.0

25.8

Rest of Asia

15,196

2,655.8

176.6

8.2

26.5

Europe, the United States, other

1,410

895.7

1.5

0.0

7.0

56

NOK CORPORATION ESG Data Book 2024

Income taxes
payableIncome taxes paid

Initiatives and External Evaluations
Engaging in Initiatives

Japan Climate Initiative

United Nations Global Compact (UNGC)In April 2021, the NOK Group signed the United Nations’Global Compact and joined the Global Compact Network
Japan (GCNJ). We have participated in ten study groups
organized by the GCNJ,
including those on SDGs,
reporting, human rights
education, environmental
management, anticorruption, ESG, internaldissemination about the
Global Compact, humanrights due diligence, WEP,
and the circular economy.

Task Force on Climate-related
Financial Disclosures (TCFD)

The NOK Group joined the Japan Climate Initiative ( JCI)in April 2022, joining with a powerful network of likeminded organizations
dedicated to tacklingclimate change throughcollaboration andinnovation.

Keidanren Initiative for Biodiversity Conservation

The NOK Group has been a supporter of the Keidanren
Biodiversity Initiative since December 2019, actively
engaging in initiatives that address multiple aspects of its
revised action guidelines and contribute to its overarching
mission of biodiversity conservation.

Keidanren Challenge ZeroIn April 2022, the NOK Group embraced the TCFD
recommendations, championing transparency andaccountability in climate change initiatives and policies.

Challenge Zero is a groundbreaking initiative spearheadedby Keidanren, with the ambitious goal of achieving adecarbonized society and net-zero emissions by the latter
half of this century. Companies are invited to submit theirinnovative challenge themes for realizing a decarbonizedsociety, with the project actively promoting and showcasingthese efforts. In February 2020, NOK endorsed theChallenge Zero declaration and has put forth a challenge
focused on advancing towards a hydrogen society throughthe development of advanced components for increased fuelcell adoption.

External Evaluations
CDP (Carbon Disclosure Project)

CDP is a global NGO committed to addressing criticalenvironmental challenges, particularly climate change. By
sending out comprehensive questionnaires to companies
worldwide, CDP evaluates theirenvironmental initiatives andshares this valuable information
on a global scale. The NOK Group
have actively participated in the
CDP questionnaire process since
fiscal year 2010.

57

FTSE (Financial Times Stock Exchange)

NOK remains a component of the FTSE4Good Index Series
and the FTSE Blossom Japan Index, both key benchmarksin ESG investing. We have also been selected for the FTSE
Blossom Japan Sector Relative Index, which is designed to
be sector neutral.

NOK CORPORATION ESG Data Book 2024

GRI Standard Content Index
Disclosure
No.

Relevant sections
Content

General Disclosures 2021 1. The organization and its reporting practices
2-1
Organizational details
2-2
Entities included in the organization’s sustainability reporting
2-3
Reporting period, frequency and contact point
2-4
Restatements of information
2-5
External assurance
General Disclosures 2021 2. Activities and workers
2-6
Activities, value chain and other business relationships
2-7
Employees
2-8Workers who are not employees
General Disclosures 2021 3. GovernanceName (heading)Page

Company Profile
Content, Editorial Policy
Content, Editorial Policy‒
Independent Verification Report

Basic Information
Content, Editorial Policy
Content, Editorial Policy‒
P.24

Supply Chain Management
Composition of Employees
‒

P.34
P.41
‒

Corporate Governance Framework
Composition of the Directors
P.44, P.46
Board of Directors and Skills Matrix
2-10Nomination and selection of the highest governance body
Board of Directors and Skills Matrix
P.46
2-11
Chair of the highest governance body
Board of Directors and Skills Matrix
P.46
Role of the highest governance body in
NOK Philosophy
2-12
P.1, P.3
overseeing the management of impacts
Governance (Sustainability Overview)
2-13
Delegation of responsibility for managing impacts
Governance (Sustainability Overview)
P.3
2-14
Role of the highest governance body in sustainability reporting Governance (Sustainability Overview)
P.3
NOK Group Policy on Prevention of Corruption
P.49
2-15
Conflicts of interest
and Bribery
Corporate Governance Framework
2-16
Communication of critical concerns
P.44, P.51
Risk Management Framework
2-17
Collective knowledge of the highest governance body
Board of Directors and Skills Matrix
P.46
2-18
Evaluation of the performance of the highest governance body ‒‒Remuneration of Directors
2-19
Remuneration policies
P.46
Board of Directors and Skills Matrix
2-20
Process to determine remuneration
Remuneration of Directors
P.46
2-21
Annual total compensation ratio‒‒
General Disclosures 2021 4. Strategy, policies and practices
2-22Statement on sustainable development strategy
NOK Group Sustainability Statement
P.3
NOK Charter of Corporate Behavior
NOK Group Sustainability Statement
2-23
Policy commitments
NOK Group Environmental Statement
P.2-4, P.25, P.34
NOK Group Human Rights Statement
NOK Group Procurement Policy
Sustainability Overview
2-24
Embedding policy commitments
P.3, P.25
NOK Group Human Rights Statement
Implementation of Human Rights Due
2-25
Processes to remediate negative impacts
P.26-27
Diligence (Human Rights)
2-26
Mechanisms for seeking advice and raising concerns
Reporting Desk and Whistle-Blowing Hotline P.48
2-27
Compliance with laws and regulations
Serious legal violations
P.50
2-28
Membership associations
Initiatives in Which NOK Participates
P.57
General Disclosures 2021 5. Stakeholder engagement
Implementation of Human Rights Due
2-29
Approach to stakeholder engagement
P.26-27
Diligence (Human Rights)
2-30
Collective bargaining agreements
Labor Practices
P.29
Material topics 2021
2. Disclosures on material topics
3-1
Process to determine material topics‒‒
3-2
List of material topics‒‒
3-3Management of material topics‒‒
200 Economic
201 Economic performance
201-1
Direct economic value generated and distributed‒‒
Financial implications and other risks and opportunities due to Risks and Opportunities (Information
201-2
P.8
climate change
Disclosure Based on TCFD Recommendations)201-3
Defined benefit plan obligations and other retirement plans
‒
‒
201-4
Financial assistance received from government‒‒
200 Economic
202 Market presence
Ratios of standard entry level wage by gender compared to
Ratio of standard entry-level salary to regional
202-1
P.42
local minimum wage
minimum wage
Proportion of senior management hired from the local
Ratio of senior management hired from
202-2
P.42
community
regional communities
200 Economic
203 Indirect economic impacts
Initiatives (Coexistence with Local Communities
203-1
Infrastructure investments and services supported
P.40
and Society)203-2
Significant indirect economic impacts‒‒
200 Economic
204 Procurement practices
204-1
Proportion of spending on local suppliers
Breakdown of local procurement by region
P.43
200 Economic
205 Anti-corruption
Prevention of Corruption and Bribery
205-1
Operations assessed for risks related to corruption
NOK Group Policy on Prevention of Corruption P.49
and Bribery
Communication and training about anti-corruption policies
NOK Group Policy on Prevention of Corruption
205-2
P.49
and procedures
and Bribery
205-3
Confirmed incidents of corruption and actions taken
P.50
Anti-corruption violations
200 Economic
206 Anti-competitive behavior
Legal actions for anti-competitive behavior, anti-trust,
206-1
‒
‒
and monopoly practices

2-9

Governance structure and composition58

NOK CORPORATION ESG Data Book 2024

DisclosureNo.

200 Economic
207-1
207-2
207-3
207-4

300 Environment
301-1
301-2
301-3
300 Environment
302-1
302-2
302-3
302-4
302-5
300 Environment
303-1
303-2
303-3
303-4
303-5
300 Environment
304-1
304-2
304-3
304-4
300 Environment
305-1
305-2
305-3
305-4
305-5
305-6
305-7
300 Environment
306-1
306-2
306-3
306-4
306-5
300 Environment
307-1
300 Environment
308-1
308-2
400 Social
401-1
401-2
401-3
400 Social
402-1
400 Social
403-1
403-2
403-3
403-4
403-5
403-6

Relevant sections
Content

Name (heading)Page

207 Tax
Approach to tax
Tax Policy
P.56
Tax governance, control, and risk management
Tax Policy
P.56
Stakeholder engagement and management of concerns related to tax Tax Policy
P.56
Business Overview by Geography
Country-by-country reporting
P.56(FY 2022, consolidated)
301 Materials
Material Balance (Material Flow)
Materials used by weight or volume
P.5, P.20
Environmental Performance Data
Recycled input materials used‒‒
Reclaimed products and their packaging materials‒‒
302 Energy
Material Balance (Material Flow)
Energy consumption within the organization
P.5, P.20
Environmental Performance Data
Energy consumption outside of the organization
FY 2023 Scope 3 breakdown
P.11
Energy intensity
Environmental Performance Data
P.20
Reduction in electricity consumption (energy saving) P.10
Reduction of energy consumption
Reductions in energy requirements of products and services
Increase in renewable energy ratio
P.10
303 Water and effluentsResponse to Water Risk
Interactions with water as a shared resource
P.13
Assessment of Water Risks with AQUEDUCTManagement of water discharge-related impacts
Water Management
P.14
Water withdrawal
Water withdrawals (consolidated)
P.14
Water discharge
Wastewater (consolidated)
P.14
Water consumption
Environmental Performance Data
P20
304 Biodiversity
Operational sites owned, leased, managed in, or adjacent to, protected
Conservation of Biodiversity
P.18
areas and areas of high biodiversity value outside protected areas
Significant impacts of activities, products, and services on biodiversity Conservation of Biodiversity
P.18
Habitats protected or restored
Conservation of Biodiversity
P.18
IUCN Red List species and national conservation list species‒‒
with habitats in areas affected by operations
305 Emissions
Material Balance (Material Flow)
Direct (Scope 1) GHG missions
P.5, P.20
Environmental Performance Data
Material Balance (Material Flow)
Energy indirect (Scope 2) GHG emissions
P.5, P.20
Environmental Performance Data
Material Balance (Material Flow)
Other indirect (Scope 3) GHG emissions
FY 2023 Scope 3 breakdown
P.5, P.11, P.20
Environmental Performance Data
P.11
GHG emissions intensity
CO2 emissions intensity (overseas)
Managing CO2 Emissions and Energy Consumption P.10
Reduction of GHG emissions
Emissions of ozone-depleting substances (ODS)‒‒
Nitrogen oxides (NOx), sulfur oxides (SOx),
Material Balance (Material Flow)
P.5, P.20
and other significant air emissions
Environmental Performance Data
306 Waste
Waste generation and significant waste-related impacts
Resource Conservation and Waste Recycling P.12
Managing CO2 Emissions and Energy Consumption P.12
Management of significant waste-related impacts
Amount of industrial waste generated
Waste generated
P.12(domestic)
Amount of waste recycled
Waste diverted from disposal
P.21(Environmental Performance Data)
Landfill disposal amount
Waste directed to disposal
P.21(Environmental Performance Data)
307 Environmental compliance
Compliance with Environmental Laws and Regulations P.5
Non-compliance with environmental laws and regulations
308 Supplier Environmental Assessment
New suppliers that were screened using environmental criteria ‒‒Negative environmental impacts in the supply chain and actions taken Conducting the CSR Supplier Survey
P.36
401 Employment
New employee hires and employee turnover
Hiring and Turnover
P.41-42
Benefits provided to full-time employees that are not‒‒provided to temporary or part-time employees
Systems to Promote Work-Life Balance
Parental leave
P.31, P.43
Human Resource and Welfare System
402 Labor/Management Relations
Minimum notice periods regarding operational changes
Initiatives (Labor Practices)P.29
403 Occupational health and safety
Occupational Health and Safety
Occupational health and safety management system
P.32
Promotion Framework
Hazard identification, risk assessment, and incident investigation Initiatives in Safety and Disaster Prevention
P.32
Initiatives in Safety and Disaster Prevention
Occupational health services
P.32-33
Initiatives in Health and Sanitation
Worker participation, consultation, and communication on
Occupational Safety and Healthcare
P.32-33
occupational health and safety
Worker training on occupational health and safety
Initiatives in Safety and Disaster Prevention
P.32
Initiatives in Health and Sanitation
Promotion of worker healthP.33, P.43
Number of health consultation calls

59

NOK CORPORATION ESG Data Book 2024

Disclosure
No.
403-7
403-8

Relevant sections
Content

Prevention and mitigation of occupational health and safety
impacts directly linked by business relationships
Workers covered by an occupational health and safety
management system

403-9Work-related injuries

403-10Work-related ill health400 Social

404 Training and Education

404-1

Average hours of training per year per employee

404-2

Programs for upgrading employee skills
and transition assistance programs

400 Social

Percentage of employees receiving regular performance andcareer development reviews
405 Diversity and equal opportunity

405-1

Diversity of governance bodies and employees

405-2

Ratio of basic salary and remuneration of women to men

400 Social
406-1
400 Social

406 Non-discrimination
Incidents of discrimination and corrective actions taken
407 Freedom of association and collective bargaining

407-1

Operations and suppliers in which the right to freedom of
association and collective bargaining may be at risk

404-3

400 Social
408-1
400 Social
409-1
400 Social
410-1
400 Social
411-1
400 Social
412-1
412-2
412-3
400 Social
413-1
413-2
400 Social
414-1
414-2
400 Social
415-1
400 Social
416-1
416-2
400 Social
417-1
417-2
417-3
400 Social
418-1
400 Social
419-1

Name (heading)
‒

Page
‒

Occupational Health and Safety Promotion
P.32
Framework
Hours worked per employee/Average numberof days of annual paid leave taken
Number of Labor Standards Act Violations
P.43
Lost-time injury frequency rate
Severity rate
Deaths due to occupational accidents
Lost-time injury frequency rate
Severity rate
P.43
Deaths due to occupational accidents
System of Human Resources Development program
P.28 , P.42
Investment in human capital
System of human resources development program
Digital Transformation Human Resources
P.28
Development Program
Global Human Resources Development Program‒‒

Basic Concept (Diversity)
P.29-30, P.42
Initiatives (Diversity)
Percentage of management positions held by women
Employee gender wage gap
P.42(percentage for female if men=100)
NOK Group Human Rights Statement

P.25

Priority Action Areas (Human Rights)
Implementation of Human Rights Due
Diligence (Human Rights)

P.26-27408 Child labor
Priority Action Areas (Human Rights)
Operations and suppliers at significant risk for incidents of child labor Initiatives Against Forced Labor and Child Labor P.26-27(Human Rights)
409Forced or compulsory labor
Priority Action Areas (Human Rights)
Operations and suppliers at significant risk for
Initiatives Against Forced Labor and Child Labor P.26-27
incidents of forced or compulsory labor(Human Rights)
410 Security practices
Security personnel trained in human rights policies or procedures ‒‒411 Rights of indigenous peoples
Incidents of violations involving rights of indigenous peoples‒‒
412 Human rights assessment
NOK Group Human Rights Statement
Operations that have been subject to human rights reviews or
Implementation of Human Rights Due
P.25, P.26-27
impact assessments
Diligence (Human Rights)
Providing Human Rights Education (Human Rights) P.27
Employee training on human rights policies or procedures
Significant investment agreements and contracts that include‒‒
human right sclauses or that underwent human rights screening
413 Local communities
Operations with local community engagement,
Coexistence with Local Communities and Society P.40
impact assessments, and development programs
Operations with significant actual and potential negative‒‒
impacts on local communities
414 Supplier social assessment
New suppliers that were screened using social criteria‒‒
Negative social impacts in the supply chain and actions taken
Conducting the CSR Supplier Survey
P.36
415 Public policy
Political contributions
Spending on political organizations
P.50
416 Customer health and safety
Assessment of the health and safety impacts of product andProduct Quality and Safety
P.37-38
service categories
Incidents of non-compliance concerning the health and safety‒‒
impacts of products and services
417 Marketing and labeling
Requirements for product and service information and labeling ‒‒Incidents of non-compliance concerning product and service‒‒
information and labeling
Incidents of non-compliance concerning marketing communications ‒‒418 Customer privacy
Substantiated complaints concerning breaches of customer‒‒
privacy and losses of customer data
419 Socioeconomic complianceNon-compliance with laws and regulations in the social and economic area Serious legal violations, etc.
P.50

60

NOK CORPORATION ESG Data Book 2024