F-TECH CSR REPORT 2019

On the Global Way

Challenging Spirit

Respecting People

Editorial Policy
Since FY2010, F-tech Inc. has reported the Group’s environmental and societal initiatives on a global basis in its “Environmental
Activity Report.” From FY2017 the Group initiated its 13th Mid-term Management Plan, and taking into consideration a social
background that highly values CSR*1 and ESG*2, the Group has changed its “Environmental Activity Report” format to a “CSR
Report” format.
We consider this report as one of our communication tools for our shareholders with relation to our CSR activities, offering
coverage of our initiatives on CSR promotion system, governance and compliance, human rights and labor, environmental
protection, safety and quality, societal contributions, and more in a reader-friendly manner.
Going forward, we will strive to provide even more complete details on items reported thus far, including the environment andsociety, while taking measures to ensure continuity.
This report is prepared with reference to the Ministry of Environment’s “Environmental Reporting Guidelines (Fiscal Year 2018
version)” for environmental matters and to ISO26000 for social responsibility matters.
Furthermore, in this report, the F-tech Group is referred to as the “F-tech Group” or “the Group,” and F-tech Inc. is referred to as“F-tech” or “the Company.”*1 CSR: corporate social responsibility*2 ESG: From the perspective of companies aiming at sustainable growth, the 3 areas to be emphasized: the environment (E), society (S), andcorporate governance (G)│ 1 │ F-TECH CSR REPORT 2019

Contents
01 Editorial Policy
03 Message from the Top
04 Overview of Corporate Activities
05 Corporate Groups and Overview of Corporation
07 Management Philosophy and CSR
08 CSR System
09 Governance / Compliance / Risk Management
11 Creating a Comfortable Working Environment
VOICE

Childcare and Nursing Support Initiatives

13 Labor and Safety & Health Initiatives
14 Quality Assurance Initiatives

Making Profit

15 Relationship with Shareholders and Investors
16 Relationship with Local Communities
17 Environmental Philosophy・Environmental Policy
19 Environmental Management

20 Mid-term Environmental Plan
21 Initiatives for Reduction of CO2 Emissions, Water Usage, and Waste Emissions
22 Material Flow
23 Supply Chain Management
24

TOPICS

The 9th Global Environment Conference

25 Environmentally-friendly Products and Technologies
26

VOICE

Pursuing Weight Reductions Through Analytic Technology

27 Global Initiatives
31

TOPICS

F&P Mfg. Inc. (F&P/Ontario, Canada)

34 Data Collection

Reporting Period
FY2018 (April 2018-March 2019) achievements and partial contents outside the scope of the reporting period.

Reporting Organizations（☞P5）
F-tech Inc. [Reporting sites: 3 sites]
Overseas Subsidiaries [Reporting organizations: 12 companies, 14 sites]
Future Predictions, Plans, and Goals
This report contains future forecasts with respect to the “Reporting Organizations” in the Group listed above.
The statements contained herein are forecasts based on information current at the time of inclusion and are notconclusive. As such, the results of future business activities may differ from the forecasts described in this report.

F-TECH CSR REPORT 2019│ 2│

Message from the Top
We will make every effort to achieve sustainable growth and CSR
based on the policy of "Back to Basics and Challenge for New."
Responding to New Trends in the
Automotive Industry
Challenging Constant TechnologicalInnovations

Continuing to Improve our CSR
Promotion System,
Along with Promoting “Compliance” and“Creation of Comfortable Workplace”

The automotive industry is on the cusp of a major turning
point as technologies such as EVs and autonomousvehicles emerge. In response to these changes, theGroup set its 13th Mid-term Management Plan of “Backto Basics, Challenge for New” beginning in FY2017, andhas since striven to achieve its goals. This combines thebasics necessary for overall business activity, looking
back at the first steps, while also looking to the future forsustainable growth options. It is our absolute resolve andcommitment to challenging new fields.
We are working toward strengthening our businessfoundation through initiatives for the Group’s CSR
activities, business process improvement, anddevelopment of unique technologies. Going forward, we
will continue to strive for sustainable growth throughaddressing each issue that arises in the changing
business environment and resolving them step-by-step.

It has been 2 years since we began company-wide CSR
committee activities in FY2017, which works to address
issues such as corporate governance, verification ofvarious internal control issues, and confirmation ofadequate systems for recognizing and solving important
issues. We are also renewing “Our Action Guidelines”,
again affirming that each and every member of theGroup is truly acting in a proper way with regards to
CSR, pushing to make this a widespread ideology. At thesame time, in striving to create a comfortable working
environment for everyone, we are raising awareness of
issues such as promoting diversity, building a work-lifebalance, and reforms of working practices, and we are
currently implementing measures such as improvementsof existing facilities and revising work rules. (☞P10-12)

F-tech Group is
Further Strengthening its Environmental
Conservation Activities
The Group regards initiatives towards environmental
issues as one of the important pillars of management. In
October of 2013, we were the first domestic automotive
parts manufacturer to obtain ISO50001 international
standard certification. As of our acquisition of ISO50001,
we have evolved our concept of energy management,
creating our new and original “Global F-tech Energy
Management System” and implementing systematicmanagement. We have received numerous environmental
awards, both in Japan and overseas, including theInternational Energy Management Award, as a company
that actively promotes the usage of clean energy. In
October of 2018, we were invited by the Singaporean
government to showcase our environmental initiatives
to 400 small and medium enterprises at the International
Environmental Conference EENP 2018. In 2017, the Groupset its new global environmental targets for 2030. Since
2009, the Group has continued to hold environmental
conferences, tackle various environmental challenges,
and share solutions, working to further strengthen our
global environmental management systems and further
reduce our environmental impact. (☞P19-24)

Balancing Strength, Durability, andWeight Savingsis the Eternal Theme of Our Products
Regardless of changes in power trains and usage
for automobiles, a fundamental requirement for our
products is to combine strength, durability, and weightsavings. In order to balance contradictory performance
demands, we have created our own original highefficiency technology to achieve high durability andlow weight at the same time. This makes full use ofdifficult plasticity processing techniques and simulation
technologies, combining synapsed regions with plasticity,hydroforming, and friction stir welding (FSW) of dissimilar
metal joints. (☞P25)
These are just the first steps the Group is taking toward
CSR activities. We will continue to strive to “always be
improving,” and as we confront our problems head-on, we
will show our sincere commitment to these improvement
activities in this report.

President & CEO

Yuichi Fukuda│ 3 │ F-TECH CSR REPORT 2019

Overview of Corporate Activities
The Challenge is Strengthening Management and Internal
Reforms Across the Whole Group.
Financial Indicators

Environmental Indicators■SalesDespite a decrease in vehicle sales in Asia, including
China, sales increased 4.1% from the previous period due
to sales to Japanese customers and production of neworders in North America. Sales totaled 235,361 million
yen.

■CO2 Emissions Volume
Goal: 7.5% reduction from the FY2013 CO2 emission
intensity
FY2018 achievement of intensity was 0.45t-CO2/sales of 1
million yen (improved 10% over FY2013)■Water Resource Usage Volume
Goal: 5% reduction from the FY2013 water resource
usage intensity
FY2018 achievement of usage intensity was 3.18㎥/salesof 1 million yen (improved 1.8% over FY2013)■Operating Income
Our operating income decreased 4.0% from the previous
period to 6.5 billion yen. We will continue to strengthen
our management and push internal reforms, particularly
with regards to factors such as increased labor costs,
reduced production efficiency, and loss of new model
launches following the worsening employment situationin North America.

■Waste Emissions Volume
Goal: 5% reduction from the FY2013 waste emission
intensity
FY2018 achievement of emission intensity was 0.023
tons/sales of 1 million yen (improved 33% over FY2013)■Interest-bearing Debt
Although new investments were on the rise due to orders
from new and existing customers, new investments in
FY2018 settled down, totaling 46.2 billion yen.
■Interest-bearing Debt Ratio
Although interest-bearing debt was 42.6% at the endof FY2014, total asset increase and strengthening ofmanagement saw the rate decrease to 33.7% at the endof FY2018.

Item

Financial Indicators
Environmental Indicators

Unit

FY2013

FY2014FY2015FY2016FY2017FY2018Sales

1 million yen

172,456

175,579

196,343

197,941

226,060

235,361

Operating income

1 million yen

6,725

5,564

6,821

8,035

6,856

6,580

Operating income
ratio

％

3.9

3.2

3.5

4.1

3.0

2.8

ROE

％

16.2

6.3

9.1

12.8

12.8

6.9

Interest-bearing debt
balance1 million yen

44,67456,57058,68659,12959,50846,220Interest-bearing debt
ratio

％

40.2

42.6

42.5

40.9

39.5

33.7

CO2 Emissions Volume t-CO2/1 million(intensity)
yen sales

0.50

0.46

0.44

0.48

0.45

0.45

Water Resource Usage m3/1 million yen
Volume (intensity)
sales

3.24

3.18

3.31

3.42

3.11

3.18

Waste Emissions
Volume (intensity)

0.035

0.031

0.038

0.045

0.026

0.023

ton/1 million
yen sales

F-TECH CSR REPORT 2019│ 4│

Corporate Groups and Overview of Corporation

On the Global Way
Established in 1947 as a metal-processing company, F-tech began manufacturing automotive parts in 1967 and has
been following the automotive industry’s development for over half a century since then. We established our first local
subsidiary overseas in 1986, and since then we have expanded our production sites across the world and have built a
global network. We have also developed a variety of original technologies to meet the needs of automakers, such astechnology to achieve strength, durability, and weight reductions at the same time. We have received high praises and aretrusted by the world’s leading car manufacturers.
Going forward we aim to provide overwhelmingly competitive products as an industry-leading global company, strive
to create new added value, keeping in mind our goal to contribute 世界を結び、世界で創る
to local communities.

On the Global Way

世界９か国、11 生産拠点、7 開発拠点が、品質・開発・生産・環境などあらゆる面で

Global Network 9 Countries, 11 Production Sites, and 7 Development Sites
In addition to developing production sites in North America, Asia, and China with state-of-the-art facilities, we have alsoestablished development sites in each area to respond quickly to customer’s demands. We are aiming to “level up” the entire
Group by the exchange of information in all areas, including quality, development, production, and the environment.

GERMANY●F.tech R&D North America Inc. European Branch

CHINA●Kentucky／Johnan America, Inc.
●●Georgia／F&P Georgia, A division of F&P America Mfg., Inc.
●Johnan De Mexico, S.A.de C.V.
●FEG de Queretaro, S.A.de C.V.

THAILAND●F.tech R&D Philippines Inc.
●F.tech Philippines Mfg., Inc.

PHILIPPINES●PT.F.TECH INDONESIA
PT.JFD INDONESIA●INDONESIA●F&P mfg., De Mexico S.A.DE.C.V.

●
●● ●
★
●

Kameyama Plant●
Kyushu F-tech Inc.

Consolidated subsidiaries
Aﬃliated companies
Branch oﬃce

★Operational sites in Japan、○Affiliated companies in Japan、●Affiliated overseas companies、Reporting Organizations◎

F-tech Inc. [Reporting sites 3 sites]★Head office, and Kuki plant (Kuki City, Saitama) ◎★Haga Technical Center (Haga Town, Haga-gun, Tochigi) ◎★Kameyama Plant (Kameyama City, Mie) ◎●Equipment Center (Kazo City, Saitama)Three Domestic subsidiaries, and an affiliated company[Reporting organizations: 4 companies]●Fukuda Engineering Co., Ltd. (Kazo City, Saitama) (FEG) ◎●Kyushu F-tech Inc. (Yamaga City, Kumamoto) (QFT) ◎●Reterra Inc. (Ogano Town, Chichibu-gun, Saitama) (Reterra) ◎●Johnan Manufacturing Inc. (Ueda City, Nagano) (Johnan Manufacturing) ◎Number of employees by regional segments
12,00010,000
8,000

Total
7,703

Total
7,948

Japan
1,322

Japan
1,345

North
America
3,470

North
America
3,594

Asia
2,911

Asia
3,009

Asia
3,430

2014

2015

2016

6,000
4,000
2,000
0

Total
8,918
Japan
1,415
North
America
4,073│ 5 │ F-TECH CSR REPORT 2019

Total
9,997

Total
10,195

Japan
1,438

Japan
1,539

North
America
4,696

North
America
4,670

Asia
3,863

Asia
3,986

2017

2018

MEXICO

Reterra Inc.

Johnan Manufacturing Inc.

●

●●●
●
●

●Ontario／F&P Mfg., Inc.
●Ontario／Dyna-Mig, A division of F&P Mfg., Inc.

Ohio／F&P America Mfg., Inc.
F.tech R&D North America Inc.● ●Michigan Branch Oﬃce

Shandong / YANTAI FUYAN MOULD CO., LTD●
Hubei / F-Tech Wuhan Inc.●
Johnan Wuhan Inc.●●Guangdong / F-Tech Zhongshan Inc.
Progressive Tools &F-tech R&D (Guangzhou) Inc.
Components (P) LTD.●
F.tech Mfg., (Thailand) Ltd. ●Johnan F.tech (Thailand) LTD.●

CANADA

UNITED STATESOF AMERICA

Johnan UK Ltd.● ●F.tech Inc. Oﬃce UK

Haga Technical CenterF-tech Head Oﬃce, and Kuki Plant
Equipment Center
Fukuda Engineering Co., Ltd.

Affiliated overseas companies●F＆P Mfg., Inc. (Ontario, Canada) (F&P)◎● Dyna-Mig, a division of F&P Mfg., Inc. (Ontario, Canada) (DYNA-MIG) ◎●F&P America Mfg., Inc. (Ohio, United States) (F&PA) ◎● F&P Georgia, a division of F&P America Mfg., Inc. (Georgia, United States) (F&PG) ◎●F-tech R＆D North America Inc. (Ohio, United States) (R&DNA) ◎● Michigan Branch Office (Michigan, United States)● F.tech R&D North America Inc. European Branch (Dusseldorf, Germany)●F.E.G. DE QUERETARO S.A. DE C.V. (Queretaro, Mexico) (FEGQ) ◎●F&P MFG., DE MEXICO S.A. DE C.V. (Guanajuato, Mexico) (FPMX) ◎●F-tech Philippines Mfg., Inc. (Laguna, Philippines) (FPMI) ◎●F-tech R＆D Philippines Inc. (Laguna, Philippines) (FR&DP) ◎●F-tech Mfg.(Thailand) LTD. (Ayutthaya, Thailand) (FMTL) ◎●PT. F-TECH INDONESIA (Karawang, Indonesia) (FTI) ◎●F-Tech Zhongshan Inc. (Guangdong, China) (FTZ) ◎●F-Tech Wuhan Inc. (Hubei, China) (FTW) ◎●YANTAI FUYAN MOULD CO., LTD (Shandong, China)●F-tech R&D (Guangzhou) Inc. (Guangdong, China) (FR&DCH) ◎●F-tech Inc. Office UK (London, U.K.)●Johnan America, Inc.
●Johnan De Mexico, S.A.de C.V.
●Johnan UK Ltd.
●Johnan F-tech (Thailand) LTD.
●PT.JFD INDONESIA●Johnan Wuhan Inc.
●Progressive Tools & Components ( P) LTD.
※YANTAI FUYAN MOULD Co., Ltd, the newly established Michigan Branch Office, andthe European Branch Office are outside the reporting scope as they are not mass
manufacturing facilities and do not have any significant impact on the environment.

Corporate Groups and Overview of Corporation
Corporate Overview
Company Name
Head Office Address
Established
CapitalRepresentative
Employees (consolidated)
Business activities

F-tech Inc.

Main

Honda Motor Co., Ltd.

19, Showa-numa, Shobu-cho, Kuki, Saitama

customers

General Motors Company
Nissan Motor Co., Ltd.

July 1, 1947

Honda R&D Co., Ltd.

6,790,370,000 yen

Nissan Shatai, Co., Ltd.

President & CEO Yuichi Fukuda

Mitsubishi Motors Corporation

10,195 people

Suzuki Motor Corporation

Automotive parts and related dies, machineries,
and tools development, manufacturing, and sales

Toyota Motor Manufacturing and others

エフテックグループについて
Our
Products: Becoming a Top Chassis-suspension Supplier

エフテ

We manufacture suspension components, such as suspension arms, subframes, and pedals, which are important safetyrelated components in automobiles, using our strong design and technological capabilities alongwith our unique integrated
得意先別売上高シェア
processing system. We have managed to achieve product strength and durability, and weight reductions at the same time, allwhile maintaining the high quality required by auto manufacturers.

Our Products

営業利益・利益

（百万円）

（百万円）
9,000

250,000

サスペンションやサブフレーム、ペダルなど、自動車の足廻り重要保安部

8,000■Pursuit of Cutting-Edge
Processing Technology
200,000

品を中心に、独自の一貫体制（企画・開発、金型・設備製作、プレス加工・
ハイドロフォーミング、溶接、電着塗装、組立）で製造しています。

7,000
6,000

150,000

Suspension component parts

Chassis system

5,000

In addition to hydroforming
and friction stir welding
100,000(FSW) technologies, we have also developed FUT-1,
50,000an ultra-precise plastic processing technology that0
allows for optimal thickness
adjustments.
2013 年
2014 年2015 年
2016 年2017 年
ROE・ROA
Hydroforming

Modules

ROE

Hydroforming is18.0%
a processing method in which a
16.0% a concave die of the desired
pipe is inserted into
14.0%
shape, and hydraulicpressure is used to shape the
12.0%
pipe into a closed
cross-section. We have reduced
10.0%
the number of operations
all while improving
8.0%
product strength,6.0%durability, and weight reductions.

ROA

4,000
3,000
2,000
1,000
0

201

設備投資
（百万円）
25,00020,00015,00010,000

4.0%

5,000

2.0%
0

0.0%
2013 年

Control parts

2014 年2015 年

2016 年2017 年

総資産

Mounted components

ROE
ROA

（百万円）

FSW

得意先別売上高シェア（百万円）■Design Technology
Capability

240000220000その他

By utilizing our proprietary analysis
technology, we are promoting
developments based on productperformance predictions fromthings like runtime suspension
systems.

200000

F,T,C（新）スズキ

18000016000033

200,000

150,000

100,000

エフテック CSR 報告書 2018

Total
226,060

Total
196,343

Total
197,941

Japan
22,016

Japan
25,229North
America
124,953

North
America
120,433

Asia
39,811

Asia
49,372

Asia
52,279

2014

2015

2016

Total
175,579
Japan
25,579North
America
110,189

50,0000Japan
28,7952017 年

Asia
65,909

2017

2018

2,000

60,0001,500

40,000

1,000

Asia
28％

500
0

20

自己資本比率

30.0%
25.0%

200.0020.0%

150.0015.0%

100.00

10.0%

50.00

5.0%
0.0%
2013 年

2014 年2015 年

2016 年2017 年

FUT-1
FUT-1 is an ultra-precise plastic processing
technology that achieves maximum material yieldand no post-processing through precise thick-plateshearing processing technology.

Japan
33,001

Asia
67,3602,500

80,0000.00

Total
235,361

North
America
136,450

3,000

100,000

トヨタ
GM

North
America
129,904

3,500

120,000

250.00120000250,000

4,000

140,000

三菱

ホンダ

100000Consolidated
sales by regional
segments(Unit: million
yen)
2013 年
2014 年2015 年
2016 年

研究開発費
（百万円）

160,000

FSW is a new technology
in which steel and
20,000aluminum are joined
0 through friction stirring. Hybrid
2013 年
2014 年
2015
年
2016 年2017 年
structures can achieve lighter
weights
withhigherdurability. This new
joining technology reduces
一株当たり当期純利益
manufacturing energy and is environmentally（百万円）
friendly.
300.00日産

140000

201

Japan
14％

North America
58％

F-TECH CSR REPORT 2019│ 6│

20

Management Philosophy and CSR
Mission Statement
From a global perspective, we strive to contribute to our society and to improve the quality oflife through manufacturing of the highest quality products with ambition and sincerity.

Corporate Philosophy

Challenging Spirit

Respecting People

Making Profit

Our Action Guidelines■Compliance with laws and ordinances

We always give top priority to ethically appropriate conduct in all our
activities. We always comply with laws and ordinances and act with agood social conscience as a good member of society in keeping withbeing a company with a high commitment to legal compliance. If we
discover any violation or possible violation of any laws, ordinances orcompany rules, we will report the matter, make suggestions, and consult
with our direct supervisor or the Corporate Ethics Kaizen Window.

■Respect for human rights

We respect all individual and human rights of our colleagues in theworkplace.
We do not tolerate any child labor, forced labor, discrimination or any
type of harassment that violates human rights.

■Labor and Safety & Health

We will establish a safe and secure working environment for all our
employees, and maintain a pleasant and safe working environment.

■Quality

We strictly follow the highest standards and procedures giving toppriority to provide products and services with safety to meet customer's
expectations.

■Compliance with company rules

We create our company's internal rules and regulations based onrational reasoning and relevant objectives to create a fair and equal
working environment and we commit to communicating with our
employees effectively.

■Traffic safety

As a member of the automotive components manufactures, we always
observe traffic safety laws, rules and regulations, being a good citizen on
the road by giving way to others on the road.

■Environmental protection

We will endeavor to protect the environment, with the belief that the
Earth belongs to all humankind. We always consider minimizing theimpact on nature and optimize energy resource utilization in
production.

■Increasing corporate value

We believe the purpose of a company as a going concern is the creationof value. We will always strive to maximize socially accepted corporate
values by bringing profit long-term for our shareholders and society.

■Disclosure and management of information

We strictly distinguish and manage information from personal, company
confidential, and to be disclosed appropriately. However, we strive to
publicly make available any required information in accordance withrespective laws and corporate regulations appropriately and in a timely
manner.

■Fair transactions

We always ensure business is conducted in a free, equal and fair mannerwith transparency, and will not engage or agree with any irrational,
corrupt business practices.
We will not allow giving and receiving of any benefit or conveniencebeyond reasonable and legal limits socially acceptable, and we will not
maintain any unfair relationship with political parties or government
authorities.
We will never permit or tolerate any relationship or connection withany anti-social organizations or behaviors which may threaten the safety
and well-being of our society.

■Community involvement

Being a member of the local community, we support the creation of an
equal, wealthy and well-being of our society through participation in
local community development, promotion of cultural, educational, andthe improvement of the welfare of the local society.

Our CSR Approach
We fully understand that our business activities affect both society and environment, and wepledge to act responsibly based on our mission statement, philosophies, and action guidelines,
as well as to contribute to the creation of a sustainable society and environment.
Realizing the corporate
mission statement

Corporate philosophy and CSR

Implementationof Our Action Guideline

Realizing CSR

Establishment
Corporate Philosophy
Challenging Spirit│ 7 │ F-TECH CSR REPORT 2019

Respecting People

Making Profit

Realizing a sustainable society

Corporate value

Governance
Human rights and Labor
Quality and Safety
Environment
Society

CSR System
We aim to steadily improve our CSR promotion systemthroughout the Group.
Consolidating and Revitalizing theCompany’s CSR Committees
through the Actions of Each Committee

Raising the Level of All Groups
Through the “New CSR Verification
Sheet”

F-tech Group, as a global company, conducts business in
the Japan, North America, and Asia Pacific regions, but
we operate with full awareness and understanding of oursocial responsibilities in each region.
Our offices in Japan and overseas, subsidiaries, andaffiliated companies are all involved in environmental
conservation activities, and the Group also holds anannual group-wide Global Environmental Conference toshare information.
Furthermore, we also promote sharing throughout
the entire Group, including through various nonenvironmental initiatives such as analysis of productquality assurance and workplace safety, reform measures,
governance, compliance, and employee work styles.
Our company-wide CSR committee was launchedin October of 2017 to standardize CSR activities as theGroup and to generate a group-wide synergistic effect.
The company-wide CSR committee aims to even further
globally energize CSR activities while sharing details of
the activities carried out by each department or related
divisions, based on the company mission statement,
philosophies, and action guidelines.

Before establishing the company-wide CSR committee,
the risk management committee created 2 types ofverification sheets, “Corporate Governance” and “RiskElimination,” and conducted surveys in each company
and department, both in Japan and overseas.
In FY2018, the company-wide CSR committee
consolidated the above 2 sheets and ESG verification
documents into the “New CSR Verification Sheet,” andsurveys were conducted in affiliated companies in Japanand overseas using this one sheet. Currently we havebegun to verify the problems and countermeasures
discovered in this survey across all companies anddepartments. Each location has already begun to selectimportant issues from the resultant themes, and we arepromoting self-directed improvements under the followup of the CSR committee secretariat.
Even after 2019 the company-wide CSR committee willcontinue to pursue improvements in significant areas
throughout the Group, improve our understanding of
CSR, and to share issues between each department andfollow up on solutions.

■Company-wide CSR Management System
Board of Directors
Chief Company-WideCSR Officer

Executive Vice President

Committee Chairperson

Company-Wide
CSR Committee
Company-WideCSR Officer

Committee Member

Promotion Director Each Division Manager
Each Manager
Promoter

Division Manager ofManagement Planning
Secretariat General Affairs Department ofManagement Planning Division
Global Committee
MemberPromotion Director
PromoterRegional
Society

Quality assurance
and Product safetyPRcommittee
Management
planning
division

Qualityassurance
evaluation
meeting
Production
planning
division

Company-wide
CSR committee.
ReportInstruction

Compliance

Environment

Human Rights
and Labor

Corporate
GovernanceCompliancecommittee
Management
planning
division

Environmental
conference
Production
planning
division

Safety and
HealthCommittee
Production
planning
division

Riskmanagement
committee
Management
planning
division

Each Site Manager
Each Related Executive

F-TECH CSR REPORT 2019│ 8│

Governance / Compliance / Risk Management
We Will Actively Work to Enhance Our Corporate Governance to
Improve Sustainability.
Corporate Governance Structure
The Group has committed management that focusesstakeholders in mind, including all of the shareholders,customers, and creditors, as well as regional societies,
and workers, the Group is endeavoring to maximize theCompany's continuous and long-term shareholder return
as a basic goal for corporate governance.
As the decision-making body for management issues,
the Company’s Board of Directors, consisting of 11
directors (including 2 outside directors), implements
important business executions, legal matters as well
as monitors business executions. We separate themanagement from business execution function byintroducing an executive officer system to strengthen
the decision-making, oversight functions of the Board of
Directors for expediting business executions.
In addition, to ensure monitoring of management,
F-tech has appointed 2 highly independent outside
directors, whose external viewpoints are actively
incorporated into management. Moreover, the directors'
terms of office are limited to one year to facilitate theCompany's ability to respond proactively to changes inthe business environment.
As a company that has elected an Audit & Supervisory
Board-style structure, F-tech has the Audit & Supervisory
Board consisting of 4 Audit & Supervisory Board
Members (including 2 outside Audit & Supervisory Board
Members). Each Audit & Supervisory Board Member,in accordance with audit policies and individual work
assignments established by the Audit and Supervisory
Board, audits the directors' performance of their workthrough, attendance at meetings of the Board of
Directors, business operation execution, and reviews its
corporation assets and financial condition.

Reception of the Corporate Governance
CodeWith regards to the Corporate Governance Code (June
1st, 2015/Revised June 1st, 2018) set by the Tokyo
Stock Exchange, we as a company have compiled ourthoughts in our “F-tech Corporate Governance Guidelines(November 1st, 2015/Revised November 29th, 2018),”
and our response has been published on our company’s
website. Furthermore, at the point of June 2019 intime, the matters for which the Company provides
explanations are as below.
(Supplementary Principle 4-2-1)
Management remuneration incentive(Set the balance of cash and stock)
Currently, the Company’s executive remuneration
is based on a fixed monthly remuneration that paysout each month, as well as an executive bonus thatfluctuates based on annual performances. Directors,
operating officers, and Audit & Supervisory Board
Members (excluding outside directors and outside
Audit & Supervisory Board Members) can contribute a
set amount of their fixed remuneration to the directors’shareholding system, thereby promoting the company’ssustainable growth and mid-to-long-term improvement
in corporate value. We will consider the introduction offurther remunerations and shareholding remunerationsaligned with mid-to-long-term performance in the future
if needed.

Corporate Governance Structure
Shareholder meeting
Selection/Removal

Selection/Removal

ReportAccounting

Exchange opinions

Auditor(s) Audit

Board of Directors
Selection/Removal

Report↑ ↓SupervisionInternal Audit Office

Audit

Representative Director↑ReportGeneral Counsel

Audit &
Supervisory Audit
Board

Management Meeting

Corporate Ethics Committee
Risk
Management Committee
Controls and Monitor

Each department, affiliated company, subsidiary

Internal control system│ 9 │ F-TECH CSR REPORT 2019

Governance / Compliance / Risk Management(Supplementary Principle 4-10-1)
Use of operational approach(Consideration of nomination and remunerationcommittee)
F-tech does not have an optional advisory committee
for discussing matters such as nominations andremuneration for directors and officers. However,
the Company discusses important matters, including
nominations and remuneration at meetings among
independent outside directors and presidents.
Furthermore, the Board of Directors actively seeks theopinions of directors and Audit & Supervisory Board
Members including independent outside directors
and independent outside Audit & Supervisory Board
Members, taking time to carefully deliberate.

Compliance Initiative
The Group established its “Corporate Ethics Committee”
in October of 2004 to verify compliance with laws andcompany policies, as well as to prepare and set policies.
This committee also makes decisions related to important
issues that cannot be handled by individual divisions,
including the protection of proponents, while providing
instruction for improvement to relevant decisions sothat compliance status can be verified at all times. In
November of 2004 we set forth our corporate conduct
standards, “Our Action Guidelines (Corporate Code of
Conduct),” in order to proactively prevent violations oflaws and regulations. In June of 2006 we established our“Compliance Regulations” compliance system with thegoal of improving corporate ethics and legal compliance.
Furthermore, the Company has established a “Corporate
Ethics Kaizen Window,” a system in which employees andother workers in the Group to directly report or consult
with the Company. In addition to later establishing a

new “Compliance Committee” in September of 2015,
the Company has also set up an “External Suggestion
Window (located within a corporate law office)” and an“Audit & Supervisory Board Member and Outside Director
Suggestion Window” for anonymous reports, creating
an environment where suggestions can be easily madethrough multiple points of contact.
Furthermore, we reviewed “Our Action Guidelines” inMarch of 2019, revising it to be a more reader-friendly
brochure that has been redistributed to all employees,
and are participating in ongoing compliance training todirectors and workers for further enhancement of ourcompliance initiatives.

Risk Management Initiatives
The Group utilizes a structure to prevent risk of loss byrecognizing the risks associated with major business
operations and placing responsible managers fromprofessional perspectives in charge of departments.
In June of 2006 we established our risk management
system, called “Risk Management Regulations.”
Additionally, in the case of an unforeseen event suchas large-scale disasters, an emergency task force inwhich the President acts as a general manager and theVice-President or responsible director acts as assistantgeneral manager is put into place after consulting withoutside lawyers to prevent additional damages and tominimize environmental harm. In September of 2015 weestablished “Risk Management Committees” throughout
each affiliated company in the Group to follow companywide risks to prevent their reoccurrence.
Since the establishment of the “Company-Wide CSR
Committee” in June of 2017, each committee between
the “Company-Wide CSR Committee,” “Risk Management
Committee,” and “Compliance Committee” have been
held respectively twice a year. At the end of each fiscal
year, each affiliated company in the Group has conducted
its own verification using checklists prepared for eachbusiness, reporting new countermeasures to the 3committees. After deliberation by the committees, a
final report and verification results from all of the Group
companies are made to the Board of Directors. These 3
committees identify company-wide issues related to theCompany’s corporate governance and strengthening of
the internal controls system, follow up on risk regulations,improve upon apparent risks, and develop company-widemeasures to prevent risk reoccurrences throughout theentire Group. The Risk Management Committee regularly
reports Board of Directors on how to identify, evaluate,
and deal with risks related to important environmental
issues.

F-TECH CSR REPORT 2019│ 10 │Creating a Comfortable Working Environment
We aim to create a healthy and comfortable working
environment based on our philosophy of respecting people.
Diversity Initiative◎Promoting Active Participation of Female Employees
F-tech aims to create a workplace where everyone,
regardless of gender, can show their individuality andabilities. There have been great improvements to ourworking environment in this regard, particularly within
the manufacturing, engineering, development, andprocurement departments, where most employees weremale, and we are actively placing women in a variety
of fields throughout the Company. Until 10 years ago
women did not work in manufacturing sites that handled
heavy metal plates. However, in the present day there
is a strong demand for the unique perspective thatwomen can provide, and there is much promise in female
engineers.
In the future, we will continue to follow the Promotionof Women’s Participation Act, promoting recruitment,
promotion, and leadership training for women as we
aim to expand the overall percentage of women in theworkplace in all fields. On the other hand, we must takeanother look at how men operate in the workplacein order to allow women to participate as well. Goingforward, we will work toward improving the working
environment so that everyone can have a good work-lifebalance and both men and women can enjoy fulfillingsocial lives.

Change in Female Employment Ratio
10.5%
10.0%
9.5%
9.0%
8.5%
2014

2015

2016

2017

Number of Female Employees

F-voice

2018

2019

8.0%

Ratio of Female Employees

Number of Female Employees

105
100
95
90
85
80
75

Ratio of Female EmployeesChildcare and Nursing Support Initiatives

Flexible Working Hours
That Match
How Your Child Grows
Kameyama Plant, Production Division,
Administration Section

Tomomi Takahara
I believe that F-tech has created an easy-to-work-in
environment for those of the age where they wish to raisechildren thanks to its combination of paid leave,pre-and-post-birth maternity leave, and flexible working
hours.
I was unable to participate in morning meetings in mydepartment due to having to drop my child off at daycare,and this weighed heavily on me at times. I’m very grateful│ 11 │ F-TECH CSR REPORT 2019

◎Promoting Active Participation of Senior Citizens
We provide an environment where our employees
approaching the retirement age of 60 can continue towork after retiring, as well as providing information likelife planning seminars aimed at specific age groups.
We launched our “Takumi System” in July of 2019to provide a new way for retired employees to work,
boosting retirees’ motivation while passing on their skills.
In this system, our talented workers with advanced skills
are recognized as “Takumi,” and they play the importantrole of instructors who pass on their skills to theirsuccessors. (3 participants at the point of October 2019 intime)◎Empowerment of Foreign Employees andRevitalization of the GroupAt F-tech we consider it essential to develop cooperation
with our overseas sites. To achieve this, we must secure
diverse human resources, and as such we are actively
hiring foreign employees on top of our active employeesof varying nationalities. Furthermore, we are accepting
short-term trainees from overseas sites and foreigntechnical intern trainees. In order to help our foreign
employees understand our operations, we strive tocreate a working environment welcoming to foreigners
through methods such as creating multilingual notices
and manuals, as well as through interactions at company
events.
◎Active Participation of Those with Disabilities
F-tech is committed to hiring people with disabilities.
Furthermore, we aim to create a working environment
where every individual can maximize their abilities andfind value in their work, regardless of disability. Our
employment rate of those with disabilities has risen since
FY2018, up to 2.6% (26 employees), above the mandatory
employment rate of 2% (20 employees).

that everyone in my department was so considerate of me
and changed the meeting time to 8:30am, taking a weightoff my shoulders.
This year my oldest son is in the senior class of his daycare
and my second son is in his second year of daycare. It seems
like they’ve both gotten used to daycare life and are
enjoying playing with their friends, one evening when I went
to pick them up, they told me “Come pick us up later.” With
that as my catalyst, I’ve been able to extend my work hours
as a challenge to myself.
When my children go to elementary school in the future,
my childcare circumstances will change even more. My task
in the future will be to figure out a work-life balance as thesethings change. At work, I aim to strive to get the expertise as
much as possible of what I am engaged in here, so I’d like tocontinue to deepen my knowledge of management duties.

Creating a Comfortable Working Environment◎Work-Life Balance Initiatives
Following our philosophy of respecting people, F-tech
believes that people need a fulfilling private life in orderfor them to work with purpose, and as such we placemuch importance on work-life balance. Furthermore, theentire Group aims to be a company that is easy to workfor, not only for those who need childcare or nursing
assistance, but for all of our employees. The following are
examples of our work-life balance initiatives.
◎Support for Balancing Childcare and Nursing
In FY2018 we held a company-wide briefing on worklife balance and a nursing care support system for all
・Overtime hours are expected to be kept within 20 hours permonth, and we are working with labor and management tomanage employees’ time and reduce long working hours.
In FY2018, the average overtime hours worked by regular
employees was 14 hours per month, and management is clearlyworking to manage hours worked and to reduce long working
hours.
・Aiming for all employees to fully utilize their annual paid leave,
which expires with lack of use, we have achieved our goalof regular employees taking 100% of their paid leave for 20
consecutive years.
・We have revised our work rules on our half-day paid leave systemfrom 4 times a year to 20 times a year starting in FY2019. This
allows employees to flexibly respond to their individual situation
as needed (childcare, school events, nursing care, outpatient
treatments, etc.).
・We are releasing our “Work-Life Balance Initiative,” announced
November of 2018 at the Kameyama City sponsored lecture at
our Kameyama Plant.

Following the Kuki plant’s gold certification
for its “Diversity of Work Style Practices” by
Saitama Prefecture, Mie Prefecture registered
the Company as a “Mie Work Style Reform
Promoting Company” in October of 2019.

F-voiceChildcare and Nursing Support Initiatives

Creating an Environment Where
Men Can Take Childcare Leave
Fukuda Engineering Co., Ltd. (FEG)
Administrative Department Test Section

Yuta Toyoda
F-tech components (SUS/MT) are put through strength anddurability tests before mass production. One of the positivesof being a member of test section is our involvement incomponents from a wide variety of F-tech sites. In addition
to testing, we also work to help reduce costs through review
of departments’ supply expenses and management of repair
expenses.

managers, done with the aim of creating a cooperative
working environment where employees can understandeach other’s circumstances regarding childcare andnursing. We will continue providing explanations during
training for new managers from FY2019 onward, andwe will also be distributing information on childcare andnursing to all employees through our company portal site.
Of the 30 female employees who took childcare leave,
28 of them returned between 2014 and 2018 (100%took childcare leave, and 94% returned to work after). Of
these, 18 (51%) took childcare leave for their second or
greater child, and we believe that this demonstrates anenvironment that makes it easy to take childcare leaveand then return to work after. The number of men taking
paternity leave has continued to rise, with 6 men taking it
thus far.
In order to supplement support during childcare
leave, we have established an interview system before
maternity leave and before returning to work, in addition
to regular communication during leave. 17 employees
are currently utilizing our reduced working hours systemfor childcare after their return to work (available throughcompletion of the 3rd year of elementary school). Nursing
care leave can be taken for up to 1 year a maximum of 3
times per eligible family member. As with childcare leave,
we utilize an interview system in addition to regularcommunication during leave.
◎Initiative for Promotion of Human Rights AwarenessAt the Company, out of the philosophy, “respecting
people”, our employees respect others and are provided
annual training to prevent the occurrence of various typesof harassment, including child labor and forced labor. We
verify the status of compliance to this respect of humanrights of employees every year.
Furthermore, we have established an internal
whistleblower hotline that allows anonymous consultsin the case that a person believes that a human rights
violation or compliance issue has occurred. We strive tocreate a working atmosphere with an open culture where
people can come forward easily.

I chose to take childcare leave because my wife fell ill one
month after giving birth to our first child. This was the firsttime childcare leave for men was available in FEG, so I tried
not to leave my work undone before I took the leave.
Thanks to this leave my wife was able to recover, mychildren have been growing well, and I could return to work.
However, I was a bit concerned about whether I could
smoothly transition back to working.
In the future, I hope it gets easier for men to take childcare
leave and reduced work hours. As a person with anexperience of child leave, I’d like to take initiative withregards to work efficiency, and to improve my skills andknowledge through challenging myself with new tests.
F-TECH CSR REPORT 2019│ 12 │Labor and Safety & Health Initiatives
Improvement through Standardized and Shared Health and
Safety Rules
F-tech* and FEG have continued and carried out labor,
safety & health activities in FY2018 as well with thecompany-wide safety policy of “getting back to basics
and completing 5S for zero occupational accidents at asafe workplace” adopted in FY2017.
The company-wide Safety Committee, consistingof members from F-tech and FEG, has been focusing
on the 2 goals of “zero occupational accidents” and“reconfirmation of rules related to large-scale accidents(forklifts, cranes).” The Safety Committee also works
to reduce the number of commuting injury andoccupational accidents.
For FY2019, our company-wide safety policy is to“standardize and share health and safety rules, andimprove the safety level of all sites,” and we plan todevelop activities toward our newly prioritized measureof “unified safety assessments and rule developments(regular/irregular work).”*Head office, Kuki Plant, Kameyama Plant, Haga Technical Center, and Kazo
Equipment Center

Prevention of Similar Accidents by
Sharing Information
Inside and Outside the GroupIn addition to taking steps to prevent recurrence bysharing information about past occupational accidents,
which was a priority matter in FY2018, we are actively
engaged in prevention of similar accidents by spreading
information laterally to affiliated companies. The
developed contents have been listed up, countermeasures for necessary improvements have been
implemented in each area, confirmed by the Safety &Health Committee.

Actions to Prevent Forklift Accidents
As a specific action taken, we introduce measures taken
to prevent forklift accidents. We have invited specialists tohold forklift workshops at the Kuki and Kameyama plants
for our workers, and we are working to further improvesafety awareness and countermeasures in place throughthings like safety lights on forklifts.

Various Initiatives for Chemical
Substance Risk Assessment
Risk assessments for chemical substances in existing
work are being carried out at all plants. Risk assessments
have been implemented in each area and necessary
appropriate improvements have been implemented
to address problem areas. We will strive even harder tostrengthen our activities this continuing fiscal year as wellto prevent occupational accidents caused by chemicals.

〈Case Study of Kuki Plant〉
A blue diode safety light is attached to a forklift,enhancing visibility with its cast light.

Case Study of Haga Technical Center’s Initiative〈Case Study of Kameyama Plant〉
The plant invites specialists to conduct in-house
workshops that include practical training.

Figure: Easy-to-see information of GHS pictogram**GHS pictogram: Display of easy-to-understand information on chemical hazards
using globally standardized pictograms.

│ 13 │ F-TECH CSR REPORT 2019

Quality Assurance Initiatives
Improving Customer Satisfaction at Every Group Site

As part of the 13th Mid-Term Management Plan, we aim
to achieve “A world top class high-quality standard” forour products. In order to provide the best possible value
to our customers, we have set group-wide goals and arepromoting quality improvement activities.
In FY2018, the halfway point of our 13th Mid-Term
Management Plan, we have created initiatives for 1) ZD(Zero Defect) Activities, 2) Preventative Activities, andProduction Sites

Commendation Achievements

3) Continuing Quality Improvements in North American
Sites. As a result of these initiatives we have seen positive
results at each Group production site, and we havealso seen an increase in the number of sites receiving
commendations from customers. In the final year of
the 13th Mid-Term Management Plan, our whole groupwill continue striving to achieve maximum customer
satisfaction.
Production Sites

Thailand；F.tech Mfg.,（Thailand）LTD.
［FMTL］
Award of Quality

Canada；F＆P Mfg.,Inc.
［F&P］
Excellence in
Delivery andQuality Award

Philippines；
F.tech Philippines
Mfg.,Inc.
［FPMI］
Excellence inQuality

Canada；F＆P Mfg.,Inc.
［F&P］
Service Parts
Award

U.S.A.；
F&P America
Mfg.,Inc.
［F&PA］
Certificate of
Excellence

China；
F-Tech Zhongshan
Inc.
［FTZ］
Quality ExcellenceAward

Canada；Dyna-Mig, A
division of F&P
Mfg.,Inc.
［DYNA-MIG］
Certificate of
Excellence

Japan；
Kuki Plant［QFT］
Certificate of
Quality Excellence

Commendation Achievements

F-TECH CSR REPORT 2019│ 14 │

Relationship with Shareholders and Investors
Striving for Timely and Appropriate Information Disclosureand Enhanced Meaningful Dialogue.
The Company has established its “policy related toconstructive dialogue with shareholders” within the
F-tech Corporate Governance Guidelines, and weare striving for timely and appropriate disclosures of
information.

Appropriate Information Disclosure(F-tech Corporate Governance Guidelines, Article 14)
In its aim to build a relationship of mutual trust withall stakeholders, including shareholders, the Company
ensures management transparency by disclosing fairly
and in a reader-friendly manner information, including
legal disclosures, management policies, financial status,and business initiatives, as well as procedures in theappointment of the senior management and nominationof, directors, and Audit & Supervisory Board Member
candidates.

Communication with Shareholders,Private Investors, and Institutional
Investors
The Company endeavors to disclose information
to shareholders, private investors, and institutional
investors both domestically and overseas in a timely andappropriate manner.
In order to further our investors’ understanding of ourcompany, we endeavor to create various opportunities
for communication through shareholders’ meetings,
financial results briefings, corporate briefings forindividual investors, facility tours, 1-on-1 meetings,
telephone conferences, and exhibitions at various events.
We will continue to work hard and expand the number ofpeople who become fans of F-tech.

Constructive dialogue with shareholders(F-tech Corporate Governance Guidelines, Article 34,
Paragraph 1)
Based on the recognition that constructive dialogue
with shareholders is essential to enhance sustainablecorporate growth and increased corporate value overthe mid-to long-term corporate value, F-tech uses every
effort to engage in such mutual dialogue.

Financial results briefing

Shareholders’ meeting[Policy related to constructive dialogue
with shareholders]
Based on the recognition that meaningful dialogue withshareholders is essential to enhance sustainable growthand mid-to-long-term corporate value, F-tech approaches
these dialogues based on the following policies.
・To the extent reasonable, dialogues with shareholders are
conducted by the President & CEO, the director with IR
oversight, other management, or managers from the division
responsible for IR.
・The division responsible for IR shall collaborate with andengage in meaningful dialogue with the internal related
divisions.
・We shall explain to our shareholders in an understandable
manner, the strategies, investments, and important company
indicators related to the Mid-term Management Plan,
endeavoring to disclose information for determining mid-tolong-term corporate value.
・The IR team plans to conduct multiple IR activities, in addition
to individual interviews, including holding financial results
briefings and facility tours and attending IR fairs.
・The executive officer responsible for IR conscientiously conveys
the Company policies to shareholders through dialogue andshares any opinions he receives from shareholders to directors
and others.
・In order to thoroughly fair information disclose, the IR
executive officer strictly controls important non-public
information in accordance with company rules.

│ 15 │ F-TECH CSR REPORT 2019

Facility tour for institutional investors at Haga Technical Center (left) and
Kameyama Plant (right)

Information meeting for individual investors

Nikkei IR Investors' Fair
(January 2018)

Exhibition for Human andAutomotive Technology (July 2018)

Relationship with Local Communities
Striving for Human Resources Development ThroughReforestation Programs and Scholarship Foundations.
F-tech reforestation program

F-tech Reforestation Program 2015-2019
Activity Report for 1st Agreed Term
As of May 2019, the 5th reforestation activity withinthe “F-tech Reforestation Program" (Moroyama Town,
Saitama) was held. It started in Japan in 2015 with the
publication of the Biodiversity Guidelines. A total of 398
people comprised of employees and their families haveparticipated in the five reforestation activities.
The activities primarily consist of forest thinning work.
Forest thinning to maintain an appropriate number oftrees with regard to their growth status is essential to thepreservation of undeveloped woodlands. However, it isa work that has struggled due to Japan’s declining birthrate and aging population, and as a result many forests
have been devastated. The lack of thinning has resulted
in a lack of sunlight in the forest, which then causes
understory vegetation to die off, and topsoil would flowout. Furthermore, as tree trunks get thinner and longer,
the water source’s groundwater recharge also declines.
As a result of these conditions, the heavy rainwater
following abnormal weather in the recent years has led
to higher risks of disasters such as landslides and debris
flows.
Results of 5 years of our activities, we have seen plentyof light shining down into a previously dark forest, and as
each forest thinning activity implement, more and more

Environmental protection activities by region

Clean up at Bizenhori River(Head Office/Kuki Plant)

Adopt program(Kameyama Plant)

Off-site cleaning activities(Haga Technical Center)

Cleaning activities at industrial park
(Head Office/Kuki Plant)

grass was growing around the trees. Compared to foreststhat are not thinned, trees that continue to grow inthinned forests absorb more CO2, leading to a reduction
in CO2 emissions.
FY2019 is the last activity year of our current
agreed term with Saitama Prefecture and Saitama
Prefectural Agriculture and Forestry Corporation, but
we are coordinating to implement these activities on acontinuing basis. (Participants: Head Office, Kuki Plant,
Haga Technical Center, Reterra Inc., Fukuda Engineering
Co., Ltd.)

Biodiversity Initiatives
As of FY2017, our target in Japan was to achieve “total
number of participants to be over 25% of the number of
employees”. In FY2018, thanks to many of our employees
we achieved this target.
Goal

Achievement

Domestic
Sites

Employee participation
rate: Over 25% (Total
participants of 206 or
more)

Participation rate: 43% Total
number of participants: 358
Activity sites: 3 Number ofactivities: 11

The Group

Continuing
biodiversity
initiatives

Total number of participants:
597
Activity sites: 12 Number ofactivities: 17

F-tech Scholarship Foundation
The F-tech Scholarship Foundation was established in 2016 with the goal of supporting highly
motivated and academically inclined university students and graduate students, to support
the futures of our world. The Foundation became a public interest incorporated foundation in2017, and it promotes around 30 people every year. We aim to use this foundation to support
the society through nurturing individuals who can contribute to the advancement of culture,technology, and academics in Japan and across Asia.

F-TECH CSR REPORT 2019│ 16 │

Environmental Philosophy・Environmental Policy
Endeavoring and being Conscious to Reduce the Environmental
Impact through the Automobile’s Full Life Cycle.
Basic Concept for the Environment
As a manufacturer of suspension components forautomobiles, F-tech has been used its proprietary
integrated system to ensure safety, throughout ourdesigns, development, production, and sales.
Currently, sales of heavy automobiles, such as low
fuel consumption cars, electric vehicles, and batterypowered hybrid vehicles, are becoming mainstream. In
order to continue being seen as a promising company
by automobile makers, we have risen to the challengeof creating a product that is safe, lightweight, andenvironmentally conscious to meet the needs of fuelefficient vehicles, all while continuing to mass-produce
and respond to the market’s changes.
Automobiles require a great amount of environmental
resources over their lifecycle, from procurement to
R&D, production, transportation, regular use, and finallydisposal. Our company recognizes that our businessactions are part of this automobile lifecycle, and webelieve that we can contribute to a sustainable society byproactively working to reduce the environmental impactof our actions.

F-tech Environmental Philosophy
In order to become the top runner in the area of the environment in the automotive industry, we will make theutmost effort to establish a future with rich nature and low carbon by having each of our associate's extending
their understanding of global environmental issues and proactively engaging in the continuous preservation of
the environment in all areas of our corporate activities.

F-tech Basic Policy
1. Work to reduce environmental impact and sustain biodiversity in all of our business activities involved in the
manufacturing of F-tech’s suspension systems, in order to form a sustainable society.
・Reduce environmental impact throughout the life cycle of the product.
・Reduce vehicle CO2 emissions by achieving lighter weight products in the development area.
・Save resources and energy in all business activities.
・Continue zero emission of waste in all business activities.
・Work on social contribution activities that lead to preservation of biodiversity.
2. Comply with environmental/energy laws and the other agreed upon requirements.
3. Strive to continuously improve our environmental/energy management system and prevent pollution.
4. Establish environmental/energy objectives and targets, and review regularly.
5. Ensure the availability of information as well as the necessary resources in order to achieve environmental andenergy goals.
6. Develop high environmental consciousness human through energy conservation activities and environmental
conservation activities.
7. Strive to take advantage of introduction of energy efficient products, equipment and service.
8. Disclose environment information related to business activities appropriately.

│ 17 │ F-TECH CSR REPORT 2019

Environmental Philosophy・Environmental Policy

Map of Important Environmental Issues
F-tech has recognized important environmental issues
related to our environmental initiatives based on therequests and expectations of our stakeholders, including
our customers and local communities. We have identified
the priority levels of these important issues in accordancewith their importance to our business and our current

initiatives, and these issues have been reflected in our
mid-to-long-term business plans.
■Process for Identifying Important Issues
Organizing and finding
issues and requirementsfrom stakeholders

Identifying priority for
F-techReflection in mid-tolong-term businessplan and environmental
action plan

Map of Important Issues

HigherRequests and expectations of stakeholders

Conservation of biodiversity

Reducing CO2 emissions

Chemical substance management
Partnerships and value chains with suppliers

Contributing to automobile weight reductions
and developing safe and environmentallyfriendly products

Reinforcement of overall management ofenvironmentally hazardous substances

Saving resources, water usage, and reducing
waste

Social contribution activities
Building and reinforcing structures according
to environmental management systems
Data provision to main customers

Environmental protections for air, water, soil andthe like
Compliance with environmental laws andregulations
Development of environmentally-conscious andenergy-conserving human resourcesGroup expansion of energy management system(ISO50001)

Importance to the Company

Important Environmental Issues
F-tech aims to help achieve a sustainable society
through reducing our environmental impact in ways
such as “reduction of CO2 emissions”, “preservation of
the air, water, and soil”, “saving resources, reductionof water usage and waste”, “management of chemical
substances”, “development of environmentally friendly
products”, and “conservation of biodiversity”, all of which
we consider important environmental issues.
In particular, we have set quantitative targets for“reduction of CO2 emissions”, “water usage reductions”,
and “waste reductions” as of 2017 as part of our “2030
Global Environmental Targets.”
Through these “2030 Global Environmental Targets”
we have outlined clear goals and are promoting
solutions to issues throughout the Group, all with theaim to meet our company environmental philosophyof becoming the “environmental top-runner” in theautomotive industry.

Higher■2030 Global Environmental Targets■CO2 emission intensity Unit ▲26% improvement
Base year: compared to FY2013
Indicator: Sales■Water Usage Intensity Unit ▲17% improvement
Base year: compared to FY2013
Indicator: Sales■Waste Emission Intensity Unit ▲17% improvement
Base year: compared to FY2013
Indicator: Sales※CO2 emissions
Subject: Energy used within factories
Out of scope: distribution, company vehicles, welding CO2 gas※ In order to increase consistency with greenhouse gas
emissions and water resources use, from this report,
sales figures include inter-group transactions.

F-TECH CSR REPORT 2019│ 18 │

Environmental Management
Improving Management Systems throughFocus on ISO50001 Group Development.
F-tech’s Company-wide Environment
Management System

Environmental Education
Since beginning our global environmental efforts in 2008,
the Company has received ISO50001 certification in 2013,
and in 2015 we established the Global F-tech Energy
Management System throughout the Group, and wecontinue to promote the expansion of ISO50001 to sites
across the entire Group. The key to success of ISO50001
is energy diagnostics. Energy specialists need to be able
to conduct diagnostics and analysis related to equipment
and energy conservation require a high degree ofexpertise, so we believe it is of utmost importance that
we develop these core human resources.
At present, we plan to foster human resources
promoting ISO50001 as “energy-saving specialized
human resources” on a global level, and we havealso pushed for energy-saving specialized humanresources as one of our main policies at the 2019 Global
Environmental Conference.

The Group believes that environmental issues are oneof the most pressing issues that we should address.
The Group's effort to obtain ISO14001 certification in
Japan got underway from 1998, and attained ISO14001
certification of its overseas production sites in 2009.
Further, the certification of the newly establishedproduction site in Mexico was completed in May 2017.

Organizational Structure
The Group started building its Company-wide
Environmental Management System from 2008. Thissystem was built so that site manager is the person-incharge at overseas production sites and each site has aperson responsible for implement of the Environmental
Management System. (See figure below)

Compliance with Environmental Laws
and Regulations

Internal Environmental Audits

F-tech has introduced ISO14001 to our production
sites and have continuously promoted environmental
improvement activities in an effort to comply with laws
and regulations of the areas we work in as well as tomeet the requests of our shareholders, all based on the
Company’s environmental philosophy. Furthermore,
we have not committed any serious environmental
violations, have paid no fines, and have not been involvedin any serious accidents.

As part of our global environmental expansion, ourEnvironmental Management System and Energy
Management System used at Japanese sites will be thebasis and it is important that they are in conformity
with system and standards. To ensure this, we regularly
conduct internal environmental audits.
In order to conduct effective audits, the Company
regularly holds internal environmental auditor seminars
and continuously strives to increase our number ofauditors. Auditors from various divisions participate
in audits to ensure fair audits. In FY2018, 35 auditors
participated in internal audits, an increase of 7 auditorsfrom the previous year.

■F-tech Group Environmental Management System
Director in charge of environment (Director of Production Planning Division)
JPN secretariat
Global Environmental Conference

Asia-Pacific 4 sites
Site representative・Environmental
management officer
・Environmental
management
implementation officer(local staff)

Japanese
expatriates(support)

Related departments

China 3 sites
Site representative・Environmental
management officer
・Environmental
management
implementation officer(local staff)

Japanese
expatriates(support)

Related departments※Integrated management of All F-tech

Domestic 6 sites＊
Environmental management officer

North America 7 sites
Site representative・Environmental
management officer
・Environmental
management
implementation officer(local staff)

Japanese
expatriates(support)

Related departments

・Site manager
・Environmental management
implementation officer
・Environmental manager promotion officer

Related departments＊The 6 domestic sites in Japan include subsidiaries and an affiliated company.

│ 19 │ F-TECH CSR REPORT 2019

Mid-term Environmental Plan
Raising our Level Group-WideThrough Sharing Know-How■Progressof the 13th Mid-term


In FY2019, we plan to expand into the neighboringareas of 3 sites that have already completed the process,but firstly we believe that it is urgent tasks to support
these areas through environmental VISIT from the head
office, and also to develop the energy improvement
process experts from human resources at each site.
As such, we are promoting “overseas expansion ofISO50001” and “energy-saving specialized human resource
development” as our major policies. In particular, we
believe that more independent environmental activities
at overseas production sites are an indispensable part ofachieving our global environmental goals.

Management Plan (Environmental Areas)

In the Company, our domestic sites lead the entire
Group’s development of environmental plans. Sharingthat know-how throughout the Group, we are working
and improving to reduce the Group’s environmental
impact while incorporating initiatives from sites both
domestic and overseas.
The core of this is our development of ISO50001*.
Expansions to F&PA in North America were completed
in 2015 and expansions to FTZ and FTW in China werecompleted in 2016. FMTL is in the process of being rolled
out throughout Asian areas. This is something we aimed
to complete in FY2018 according to the mid-term plan,but ISO/TS16949 was changed in 2016, and with it cameissuance of changes to international standard IATF16949,
which targets automotive industry quality management
systems. For dealing with IATF16949, and adjustment ofstarting periods by FMTL and the head office’s support,
the completion would be FY2019.

＊Group development of ISO50001: In October of 2013, Kameyama
Plant in Mie Prefecture became the first domestic automotive
manufacturing company in Japan to obtain Energy Management
System ISO50001 certification. In 2015, we built upon the efforts at the
Kameyama Plant and issued the “Global F-tech Energy Management
System” as a common energy management system for the entire
Group. This system covers all the requirements set forth by ISO50001
as well as our own knowledge and is shared across the Grouphorizontally to all production sites.

■13th Mid-term Environmental Plan (2017-2019) FY2018 Results

Subject: F-tech Group (6 sites in Japan, 14 sites overseas)

Development Content
・Reduction of CO2 emission intensity
・Reduction of water quality source
usage intensity
・Reduction of waste emission intensity
・Issuance of environmental reports at
production sites
・Compliance with ISO50001 at overseas
benchmark sites
・Obtain ISO14001 (FY2015 revised)certification
Subject: F-tech Group・Obtain ISO4001 certification forrecently launched mass production sites
・Training energy-saving specialized
human resources
・Contribution activities to regional
communities
・Evaluation of biodiversity (business
operations area)

2017
Plan
Results⇒Evaluation
Plan
Results⇒Evaluation
Plan

Period2018

10.5% improvement ⇒〇9.6% improvement ⇒〇[4% improvement (compared to 2013)] [5% improvement (compared to 2013)] [6% improvement (compared to 2013)]
3.8% improvement ⇒△1.7% improvement ⇒×[4% improvement (compared to 2013)] [5% improvement (compared to 2013)] [6% improvement (compared to 2013)]

Results⇒Evaluation

25.9% improvement ⇒〇32.6% improvement ⇒〇Plan[Issuance preparation][Issuance preparation]

Results⇒Evaluation Start of issuance preparation ⇒〇Plan[Asia-Pacific start]

Results⇒Evaluation Manual preparation completed ⇒〇[Asia-Pacific completion][Issuance registration]

Results⇒Evaluation

2 remaining sites incomplete ⇒△Acquisition site transaction complete ⇒〇[Continuous development]

Maintain FY2016 standards level[Plan training curriculum]

Results⇒Evaluation Proposed plan completed ⇒〇
Plan
Plan

[North America horizontal development]

2/3 support completed ⇒×[System building]Plan[Internal issuance]

Start of issuance preparation ⇒〇

Plan

Plan

2019 Goals[6% improvement (compared to 2013)] [7.5% improvement (compared to 2013)] [9% improvement (compared to 2013)][Structure training curriculum][Training completed]

Program preparations completed ⇒〇Maintain FY2016 standards level[Current understanding][Consideration of countermeasures][Brushing up Guidelines]

Results⇒Evaluation Understanding completed ⇒〇 Countermeasure consideration completed ⇒〇〇: Target achieved; △: 70%-99% achievement; ×: Less than 70% achieved.
We refrain from announcing the goals of “development/engineering” due to consideration of confidential information.

F-TECH CSR REPORT 2019│ 20 │

Initiatives for Reduction of CO2 Emissions, Water Usage, and Waste Emissions
We are Striving to Improve Data Accuracy Across the Entire
Group.
■CO2 Emissions-Current Achievements Target achieved: Target＜Reduce 7.5% CO2 emissions intensity unit compared to FY2013＞ →Results＜Reduced: 9.6%＞■CO2 Emissions-Current Achievements

0.498
0.460

160,000

0.483
0.436

0.450

0.5

0.446

0.450

131,621

131,726

0.5
0.2

0.446

■CO2 Emissions-Current Achievements
140,000
t-CO2 ■Japan
120,000
200,000 106,056
100,000
180,000
0.498
80,000160,000
60,000140,000
40,000120,000

131,621■North America ■China122,387■Asia-Pacific
109,602102,987
0.460

0.483
0.436
122,387

Intensity unit（t-CO2/JPY 1M sales）
0.6■FY2018 Breakdown by Region
Japan 25％
Asia-Pacific 13％
131,726
0.4
China 21％
Intensity unit
（t-CO2/JPY 1M sales）
0.6
BreakdownbyRegion■FY2018
0.3■COAchievements
109,6022 Emissions-Current
106,056
102,9870.4
0.1

t-CO2/JPY 1M

180,000■North America ■China ■Asia-PacificJapan 25％

t-CO2/JPY 1M

t-CO2 ■Japan
200,000

Asia-Pacific 13％
China 21％CO2 emissions increased by 24% comparedto FY2013 and are increasing year by year.
Compared to last year, CO2 emissions areabout the same, and the breakdown is asfollows: North American sites, which havea high emission rate, stayed at roughly thesame emissions rate; China and the AsiaPacific slightly decreased their emissions
rate; Japanese emissions rates increased
due to an increase in production.
We will strive to reach our 2030 targetof reducing CO2 emissions throughoptimization of energy use via ISO50001
and sharing environmental measures andactivities throughout the Group.

North America 41％
Intensity unit
（t-CO2/JPY 1M sales）
0.3
0.6
0.0
2018
■FY2018 Breakdown by Region
0.2
0.483
0.5
0.460
0.450
0.446
160,000 ■Water Resource UsageCurrent Trends
0.436
40,000Japan 25％
Asia-Pacific 13％
0.1 ㎥ JPY 1M sales)
Intensity unit
（ /140,000
m3 ■Japan ■North America ■China ■Asia-Pacific
131,726
131,621
North America
41％
20,0000.4
122,387China
21％
1,200,000
3.70
120,000
109,602
3.42■FY2018 Breakdown by Region
0.0
0 106,056
102,987
3.31
2013
2014
2015
2016
2017
2018
3.45
3.24
100,000
0.3
1,000,000
3.18
3.18
Asia-Pacific
19％intensity unit compared to FY2013＞ Results＜Reduced: 1.8%＞
3.11
Targetnot3.20
achieved : Target＜Reduce5%water usage→
Japan 13％80,000■Water Resource775,695
Usage-796,544
Current847,904
Trends 864,070
0.2
2.95
800,000
60,0003 ■Japan ■North America ■China ■Asia-PacificWater usage has increased year by year, up
Intensity unit（㎥/ JPY 1M sales)
m 652,801
672,275
2.70
1,200,000
3.70
32% from FY2013. Most of the Group’s water
40,0000.1
600,000
3.42■FY2018 Breakdown by Region
usage is heavily linked to coating process
3.31
2.45
3.45
North
America41％
20,0003.24
1,000,000
3.18
3.18
due to its usage in cleaning of products,
Asia-Pacific 19％
3.11
2.20
Japan 13％
3.20
0.0
0
400,000
2013
2014
2015
2016
2017
2018
surface treatments, electrodeposition
796,544864,070775,695
847,904
1.95
2.95
800,000
coating, and steam usage.
672,275
200,000 652,801■Water Resource Usage- Current Trends
China 29％1.70 North America 40％
Looking at the usage percentages by
2.70
600,0003 ■Japan ■North America ■China ■Asia-PacificIntensity unit（㎥/ JPY 1M sales)site compared to FY2013, our sites in the
m
2.45
1.45
0
1,200,000
3.70
2013
2014
2015
2016
2017
2018
Asia-Pacific region and North America
3.42■FY2018 Breakdown by Region
2.20
400,000
have reduced their usage of water per
3.31
3.45
3.24
1,000,000
3.18
3.18
1.95
Asia-Pacific 19％
unit due to measures toward water usage
3.11
Japan
13％
3.20
200,000 ■Waste Emissions- Current Trends
reductions. Usage at our sites in Japan and
China 29％
796,544864,070 1.70 North America 40％
775,695
847,904
2.95
800,000
Intensity unit（ton/JPY 1M sales）
ton ■Japan ■North America ■China ■Asia-Pacific
China has deteriorated due to increases in
672,275
1.45
652,801
0
16,0000.05
2.70
production. In FY2018, we conducted water
0.045
2013
2014
2015
2016
2017
2018
BreakdownbyRegion■FY2018600,000
shortage risk assessments at each site.
14,000
2.45
0.038
0.04
Going forward, we will continue to promote
Asia-Pacific 8％
0.035
Japan 21％2.20
12,000 ■Waste
400,000
EmissionsCurrent
Trendsto manage our daily water usage based on
China 15％
10,5820.031
1.95
risk assessments.
Intensity unit
（ton/JPY 1M sales）
ton ■Japan ■North America ■China ■Asia-Pacific
10,000
0.03
8,828
0.026
200,000
16,0000.05 North America 40％
China 29％
1.70
0.023
0.045
8,000
■FY2018 Breakdown by Region
6,967
6,644
6,971
14,000
1.45
0
0.02
6,320
0.038
2013
2014
2015
2016
2017
2018
6,000
0.04
Asia-Pacific 8％
0.035
Japan 21％
12,000China 15％
10,5820.031
4,000
0.01Target＜Reduce 5% waste emissions intensity unit compared to FY2013＞ → Results＜Reduced:32.6%＞
Target achieved:
10,000
0.03
8,828
0.026
North America 56％
2,000 ■Waste Emissions- Current Trends
0.023
8,000
In accordance with our targets set inIntensity unit（ton/JPY 1M sales）■North6,967
ton ■Japan
6,644 America ■China ■Asia-Pacific
6,971
0.00
0
16,000
0.02
2013
2014
2015
2016
2017
2018
6,320
0.05
the 2030 Global Environmental Plan, we
0.045
6,000
■FY2018 Breakdown by Region
unified the Group’s definition of waste in
14,0004,000
0.038
FY2017. However, certain overseas sites had
0.04
0.01
Asia-Pacific 8％
0.035
Japan 21％
12,000different recognitions of these definitions,North
America
2,000
China
15％ 56％
10,5820.031■North America ■China
2014

2015

■Asia-Pacific

2016

2017

t-CO2/JPY 1M

20,000 ■Japan
100,000
t-CO2
200,000
0
80,0002013
180,000
0.498
60,000

ton/JPY 1M

m3/JPY 1M

m3/JPY 1M

m3/JPY 1M■Water Resource Usage- Current Trends

8,000

2013
6,967

2014

8,828
2015

2016

6,644

0.026
2017
6,971

6,000

2018
0.023
6,320

4,000

0.03
0.00
0.02

ton/JPY 1M

10,0000

ton/JPY 1M■Waste Emissions- Current Trends

0.01
North America 56％

2,000
0

2013

2014

2015

2016

2017

2018

0.00

 C
 O2 emissions covers energy usage in factories and research laboratories, as well as energy※
utilized in logistics and distribution.
※In Japan, data includes Kuki Plant, Kameyama Plant, Haga Technical Center, and domestic
subsidiaries.

│ 21 │ F-TECH CSR REPORT 2019such as including potentially valuable scrap
as waste, so waste emissions were higher
than typical.
Therefore, we have thoroughly redefined
our definition of valuable items, checked
waste amounts going back to the base year,
and have improved data accuracy for themost recent fiscal year. These modifications
for the past 3 years’ data have not been
completed at certain sites, but we areaiming to thoroughly disseminate ourstandards and definitions for FY2019.
We are also considering to change ourtarget figures accordingly.

Material FlowINPUTOUTPUT

F-tech Group

Entire Group
Waste

Water resources
864 1,000m3

EnergyElectricity
212,678 MWh

CO26,320 tDirect waste
amount outsideof company

2,052 tResearch &Development↓

City gas
5,640 1,000㎡

Production

Natural gas
3,444 1,000㎡

Stamping

CO2

122,282 t - CO2

Welding

LPG
4,283 tPaint & Assembly

Gasoline
307 kℓCompany vehicles

Diesel fuel315 kℓKerosene
8 kℓ
Gasoline
0 kℓDiesel fuel3,139 kℓ

CO28,313 - CO2

Transport

Customers (car manufacturers)

Users

・Output CO2 emissions were calculated by multiplying the amount of energy consumption inputted by the CO2
conversion factor.
・The CO2 calculation method refers to the “Greenhouse Gas Emission Calculator and Report Manual” issued by the
Ministry of Economy, Trade and Industry and the Ministry of Environment and WRI/WBCSD’s “The Greenhouse Gas
Protocol.”・Domestic power consumption was calculated based on the most recent co-efficient of each power company.
・Reporting period: April 2018-March 2019
F-TECH CSR REPORT 2019│ 22 │Supply Chain Management
Promoting Initiatives that Focus on the Value Chain.

F-tech Group Green Purchasing Concept
The Group has reflected its basic philosophy of green
procurement in the “F-tech Green Purchasing Guidelines”
to purchase environmentally-friendly component parts,
materials and products on a priority basis.
Since July 2013 when we started delivering the
Guidelines to approximately 70 of our customers、weare currently asking 61 of our domestic and overseas
customers to undertake the following (as of April 2019):
 onstruction of an environmental management system●C● Compliance with environmental laws and regulations● Conduct management of chemical substances in
products● Grasp and reduce greenhouse gas emissions
The Group is dedicated to continuously protecting the
global environment by promoting green purchasing
to its customers in accordance with the “F-tech Green
Purchasing Guidelines.”

Management of Chemical Substances in
Products

Outreach to Customers

Purchasing Policy Explanatory Meeting
We held an explanatory meeting about our purchasing
policy in Saitama City in Saitama in April 2019, attended
by 61 customers, where we introduced the Company’senvironmental initiatives as a case study. We requested
their cooperation with conducting an environmental
initiative status survey and were able to understand thesituation of our customers. Going forward, we will holdexplanatory meetings to explain the Company’s policies
on CSR to our customers for their understanding.
■Environmental Initiative Status Survey
1. Environmental impact substance survey:①each energy consumption②water resource consumption
2. Setting CO2 reduction targets and achievement
status
3. Status of biodiversity activities

Case Studies of Improvements

With respect to regulations concerning chemical
substances in products, the Group has establisheda management system at each site and conductsInternational Material Data System (IMDS) surveys. The
Group has established the “F-tech Chemical SubstanceManagement Standards” which strictly prohibits the useof chemical substances which are harmful to humans or
the environment or whose use is prohibited or restrictedby law.
Through the green purchasing movement, we arealso working toward eliminating these target substanceswith our customers’ understanding and providing to thecustomers with products free of such chemical substance.

The Company appeals to our customers to improve theirefforts in reducing greenhouse gas emissions.
・Reducing iron scrap waste by purchasing welding wires
and using steel pails that are able to be separated asrecyclable garbage.
⇒2,452kg/year CO2 reduction; “Approximately 175
cedar trees”
・Specifications for carts for parts transportation havebeen adjusted, and loading efficiency was improved bystacking, and transports required have been reduced.
⇒3,044kg/year CO2 reduction; “Approximately 217
cedar trees”■Grasping Greenhouse Gas Emissions in the Value Chain

Conflict Mineral Investigation
As an important concern for ESG, since the conflictmineral issue is linked to human rights violations in the
Republic of the Congo and surrounding areas as well as
destruction of the environment, using conflict minerals
as a source of funding for armed insurgents is strictly
prohibited. With the cooperation of customers, weregularly participate in investigations conducted underthe “OECD Due Diligence Guidance for Responsible
Supply Chains of Minerals for Conflict-Affected and HighRisk Areas” issued by the Organization for Economic
Cooperation and Development (OECD).

Domestic customers’ Greenhouse Gas Emissions
GHG* emissions
Grasp rate

t-co2
5,000

92.86%

92.90%

81.60%

86.44%

87.40%

87.80%

4,000

100%
80%

3,074
3,000

2,669

60%
1,852

2,000

1,851

1,851
1,486

1,000
0

40%
20%

2013

2014

2015

＊GHG: Greenhouse gas│ 23 │ F-TECH CSR REPORT 2019

2016

2017

2018

0%

Other

TOPICS

The 9th Global Environment Conference

The 9th Global Environmental Conference was held in
Guangdong (Zongshan), China, from October 16-18,
2018, and was attended by 31 managers from 13 sites.
Through all of the Global Environmental Conferences,including this 9th conference, the sharing of effective
environmental measures equivalent to a total of
approximately 350 million yen has allowed us to reduce
our environmental impact and manufacturing costs
across the entire Group. At the meeting, the secretariat
primarily focused on the following 3 items.

(1) “2030 Global Environmental Targets”
Progress Confirmation:

While company-wide targets were met in terms of CO2
emission intensity and waste intensity for FY2017, there
was a particularly notable difference in results for waste
intensity. This is because our definition of waste, which
was a new target, was construed inconsistently acrosscertain sites. After sharing at the conference, we began
to review and correct our data on paid waste, unpaid
waste, and valuable resources. Going forward, we willcontinue to work on improving our data accuracy. We
also developed environmental data analysis tables foreach site and have instructed sites that did not meettheir targets to make improvements based on causal
analysis.

(2) Issuance of Environmental Reports
by Each Production Site:

Purpose of internal functions: Improve theenvironmental awareness at each site, and improve data
accuracy in accompanying publications.
Purpose of external functions: Announce our stanceon environmental protections and concrete measures tobe taken, be held accountable to external stakeholders
and to lead an appropriate assessment ofenvironmentally-friendly business activities.
To this end, we have confirmed the implementation
status at each site, aiming for external issue at each site
in 2020.

(3) Toward the 10th Global
Environmental Conference:

2019 will mark the 10th anniversary of the Global
Environmental Conference. A checklist has beendeveloped to confirm the implementation ofenvironmental measures that have been laterally
deployed in the past. In the future, we will be checking
the environmental data analysis status at each site aswell as the progress of initiatives, and the Group will
work together to achieve the “2030 Global
Environmental Targets” as we address weak points andcontinue with human resource development.

■Grand Prize (First Ranked Site)：F&P Mfg., Inc. (F&P)■Excellence Award (First ranked site for measure)： F-tech Wuhan Inc. (FTW)

Changing welding wire packing – Fiber cask

Improvement of dissolved water for paintwastewater treatment chemicals

By changing the material of
the welding wire’s containerfrom a mix of metal andfiber to all-fiber, its capacity
has been doubled. As aresult of this improvement,
all empty containers are
now able to be recycled which had previously been
disposed of as waste, reducing waste by 50%.
Additionally, by doubling the capacity of each packaging
unit, the amount of inventory stored is available forreview, leading to a potential reduction in purchasing
and disposal.（☞P31）

Up until now, tap water wasused for the dissolution ofchemicals used in paintwastewater treatments.
After this improvement, byusing treated water fromthe drainage treatment
plant instead of tap water as the dissolved water forchemicals, the company has reduced its tap water usage
by 3,360 tons per year and reduced its water bill by
10,517 yuan. Furthermore, working in conjunction withwater level sensors, tanks are automatically supplied withthe appropriate amount of water.（☞P33）■CSR Award：F&P mfg.,De Mexico S.A.DE.C.V (FPMX)■Idea Award：F.tech Mfg., (Thailand) Ltd. (FMTL)

Environmental education for nearby schools anddonation of garbage cans

Set-up of “garbage bank” within the site/Trade of
garbage and eggs

Environmental seminars
were held at nearby schools
in order to help deepen theenvironmental knowledgeof their junior high and highschool students. The
students were very
interested in the environmental issues that have been
increasing in recent years, and they had many questions
and concerns about the effects of water and air pollution
on the global environment. Lastly, the company also
donated garbage cans to help raise the students’environmental awareness.（☞P30）

Employees’ awareness ofwaste separation was notsatisfactory at this site,
resulting in recyclable waste
mixed in with other wastes.
Because of this, in aneffort to raise employees’
awareness regarding garbage separation, they
established a “garbage bank” that collects recyclable
garbage within the site and allows employees to savemoney by recycling with this system. The recyclable
garbage profit is then allocated to the cost of trading
garbage for eggs (☞P32), and toward the costs ofenvironmental conservation activities.
F-TECH CSR REPORT 2019│ 24 │

Environmentally-friendly Products and Technologies
Promoting development looking to next-generation
automobiles, from gasoline engines to electric motors.
Since the Company began business with the Honda Motor
Company in 1959 producing 2-wheeled components, totoday where we develop and manufacture major safety
parts for the suspension systems of 4-wheeled vehicles,
we have supported the development of a mobile society
through auto manufacturers around the world.
Even if automobile powertrains shift from engines
to motors in the future, the performance requirementsof lightweight, durable, and safe suspension parts
will remain constant. The Company is keeping nextgeneration vehicles ever in mind as we continue ourdevelopment.

Sharing Technology in the 4 Cornersof the World, and Building a 24-Hour
Development System

At present, we have 7 research, development andtechnology sites in addition to our 11 production sites
across 9 countries in the world. The main roles of sites ineach region, such as product development, prototyping,and verification of production efficiency, are transparently
shared, and as a result our development sites acrossJapan, North America, and Asia work together to enable24-hour development.

Furthermore, the Company has constructed astructure and frame that is highly energy-efficient andabsorbent using its independently constructed impact
analysis method. The Company has become capableof developing based on the needs of each individualvehicle.

Development of Resinification for Pedal
Arms and Contributions to Weight
Reductions

The Company has utilized resin products for portionsof our pedal parts for a long time. Recently, Honda
of America Mfg., Inc. has begun mass production ofresinification for clutch pedals. Aiming to meet increasingfuel economy regulations, further weight reductions of
products has become one of our main keywords.
We have helped to contribute to improved fuelefficiency through reducing the weight of our main
products, which include chassis parts such as suspension
arms and axel beams, by means of adopting high-tensilematerials to reduce thickness while maintaining strengthand durability.

Using Proprietary Analytic Technology
to Predict Field Product Performance

In order to respond to our customers’ growing needs for
improved strength, durability, and vehicle performance,
the Company implements product designs utilizing
independently developed optimization simulations andstructural simulations. Optimization simulations are a method
used to examine product shape without waste, as well as
respond to recent demands for increased crash performancesand development of the most lightweight products.

Developing a High-Rigidity Suspension Arm that Achieves Stable Steering for Vehicles
Suspension arms are subjected to torsion and strain
without increasing the sheet’s thickness, while also
when exposed to weight or inertia. In flat sheet
achieving weight reductions at the same time.
structured suspension arms, which have been used,
In addition, we have created a highly efficient
the way to increase the rigidity by preventing torsion
method to produce this high technology plasticity
and strain was to thicken the sheet. However it caused
processing through original technologies that makeanother problem which was the increase of theuse of our general-purpose equipment.
weight.
By double-burring the
Performance Comparison on Suspensions
high-rigidity suspension
Rigidity
Inverse cross section + Double burringarms developed by theHighly difficult plasticity processing
Company, we are able tohelp suppress this torsion,
Flat-sheet structureHigh-rigidity createdmaking the components
resist deformation.
Furthermore, by adopting
an inverse and doubleInverse cross section + Double burring
Flat-sheet structure
Flat-sheet structureHigh-rigidity Arm
burring structure, we are＊1＊2High-rigidity Suspension Arm(Sheet thickness increased)able to increase rigidity＊1 Inverse cross section: Shape where the end of the steel sheet folds inside the main body of the suspension arm＊2 Double burring: Structure where Bush is supported from both sides (high rigidity, increased steering stability)│ 25 │ F-TECH CSR REPORT 2019

VOICEF-voicePursuing Weight Reductions Through Analytic Technology

Research & Development

The Pursuit of Weight Reductions
through Analytic Technology
is an Important Theme for
Next-Generation Vehicles.
Research & Development Division, Product Development Dept.,
Control Development Section

Aisuke WatanabeIF

personally like cars and manufacturing, so I chose to geta job in the automotive industry and discovered F-tech.
-tech produces components that play particularly
important roles in automobiles. I was fascinatedby the consistent process in the making of parts that
affect ride comfort and operability, such as suspension
and pedal components, from development throughproduction, and I decided to join the company.
roduct design is likely to be regarded as justdrawing, but that’s not all there is to it. Not only must
products perform, but they must also take into accountand reflect the opinions compiled from across various
other departments. In fact, the most important job of adesigner is to work with customers and other sections of
the Company over and over to determine the final formof the product.
n recent years, next-generation vehicles like those withelectric motors and autonomous cars have become
the hot topic.

P
I

R

educing an automobile’s weight significantly affects
its inherent fuel efficiency and helps to reduce CO2
emissions. Furthermore, it leads to a reduction in heightof the vehicle’s center of gravity, which helps to improvedriving performance and steering stability. With regards
to weight reductions, analytic technologies make itpossible to propose shapes and specifications for thealignment of joists and material replacements that othercompanies cannot consider themselves.
n order to create even more refined technologies,
we must not only evolve existing technology, but
incorporate new technologies as well. By integrating
both new and existing technologies, we hope torelease appealing products to the world. When I see thespecifications that were toiled over so greatly becomecomponents which are then loaded into a car that goeson to drive around town, I truly realize how enjoyable
and rewarding this job can be.

I

F-TECH CSR REPORT 2019│ 26 │

CSR - Global Initiatives

Japan
Kuki Plant (Kuki City, Saitama)

Planned Response to Total Abolition of Mercury Vapor
Lights, and Energy Savings with LED Replacements
After 2020, the production of high-pressure mercury lights will be banned inaccordance with the Minamata Convention. As such, the Kuki Plant has set forth aplan to completely abolish high-pressure mercury lights by the end of 2019, andit has been progressing on replacing them with LEDs since 2017. Out of a total of
138 high-pressure mercury lights, 121 were replaced by FY2018, and the remaining
17 lights were replaced with LEDs this year, the final year of the plan. By not only
replacing the lights but also optimizing illumination, the plant has reduced its
power consumption from 240,683kWh per year with mercury lights to 38,719Kwh, a ▲Before
reduction of 201,964kWh per year.
Furthermore, LEDs can be turned on instantly when needed. As a result, lightsthat had previously needed to be kept on can now only be turned on as necessary,
reducing power consumption during operations.
In the future, we believe that further promotion of LED lighting will be requiredby the “Improvements of Lighting Culture” recommended by the Ministry of theEnvironment, and as such we hope to systematically replace the fluorescent lights inour offices with LEDs instead.
▲AfterKameyama Plant (Kameyama City, Mie)

Reduction of usage of city gas via heat pump
In the cation electrodeposition coating process, the first step is combustion in the
hot water boiler to raise the temperature of the water tank to the set temperature(60℃ to 80℃). The boiler must continue operating to maintain this set temperature,
resulting in a constant usage of city gas during operations. The usage wasparticularly high during the cold winter months. This year, the plant introduced aheat pump (electric) as an improvement measure to reduce the consumption of citygas. After the hot water tank reaches the set temperature, the heat pump maintains
Heat pump
the temperature to reduce the amount of city gas consumed. Comparing winterCombustion in the boiler to raise
Heat pump maintains the temperature
the temperature to the set temperature
after it reached to the set temperature
Flow of hot water
To each processmonths, the usage of city gas was reduced by 740㎥ (CO2 equivalent: 1,539kg of
CO2). In the upcoming fiscal year, we plan to promote even further reductions in fuelBoiler
Hot water tank
About 60 - 80
Heat pumpconsumption by optimizing the start times of operating our drying furnace.
City gas℃℃

Haga Technical Center (Haga Town, Haga-gun, Tochigi)

Power reductions through inverterization of a cooling tower│ 27 │ F-TECH CSR REPORT 2019

Hydraulic power source 1
Cooling tower

Hydraulic power source 2

INV installed in 2018

Hydraulic power source 3

Cools off hydraulic oilof 3 machines

Cooling tower

Used for 13 vibration generation machines

The fatigue tester used to test the durability of developed components utilizes acooling tower to cool off the hydraulic oil used to power the machine. The cooling
tower brings in outside air through the ventilator to cool off the water that has beenheated through use, and the remaining cooling water is cooled by evaporating a
portion of the water. The cooling tower that is currently in use was first introduced
in 2001, and the ventilator is designed to rotate at a constant rate, enough to handle
even the maximum load, regardless of the outside temperature and operational
status of the hydraulic power source.
This time, as an energy-conservation measure, the plant is utilizing an inverter
control to adjust the output of the ventilator, and by setting it to an appropriate
temperature for the hydraulic oil, we are able to prevent overcooling. As a result, we
expect to reduce power consumption by 10,780kWh (4.1 tons of CO2) compared tothe previous year.

CSR - Global Initiatives

Japan
Fukuda Engineering Co., Ltd. (FEG/Kazo City, Saitama)

Reducing power consumption by using LEDs for outside lights
FEG utilizes halogen bulbs for the 9 exterior lights installed on the premises. Thistime, we aimed to reduce power consumption by replacing these outside lights withLED bulbs.
The halogen bulbs used at FEG consume 400W each, and as they are lit for
12 hours each day, their power consumption is [400W x 12 hours x 30 days x 9
bulbs=1,296kWh per month]. By changing those outside lights to 160W LED bulbs,
their consumption becomes [160W x 12 hours x 30 days x 9 bulbs=518.4kWh permonth], a reduction in power consumption of 777.6kWh per month. Furthermore,by switching the automatic lighting that activates at 5:00pm to a setting that utilizes
a sensor to automatically turn on the lights after dark, even if it is after 5:00pm,
which have helped us reduce the power consumption in summer. The new bulbs
also only need replacing every 10 years instead of every 3. Electricity rates areprojected to increase in the future, so we would like to push even harder for energy
conservation efforts.

Kyushu F-tech Co., Ltd. (QFT/Yamaga City, Kumamoto)

LED lighting in the buildings

Since FY2017, Kyushu F-tech has been promoting the use of LEDs for in-houselighting in its plants. As a first step, we changed the lighting in press and forging
plants to LEDs in FY2017, and in FY2018 we changed to LEDs in its welding,assembly, and office buildings, nearly completing the switch to LED lights for thewhole plant. Comparing sales and electricity consumption from the first step of thisprocess in FY2017 to its completion in FY2018:
FY2017 Sales: 1,609 (million yen), Electricity consumption: 1,180,841 (kWh)FY2018 Sales: 1,513 (million yen), Electricity consumption: 1,046,437 (kWh)As you can see, sales decreased by 6.0% in FY2018, while electricity usage
decreased by 11.4%, a significant change. This decrease is not simply due tochanging all the lighting equipment at the plant to LED illumination, but building
the habit of turning lights on and off for break times as well. In the future, the plant
plans to change the section lights of each workshop to LEDs as well.

Stamping plant

Welding plant

Reterra Inc. (Ogano Town, Chichibu-gun, Saitama)

Energy-conservation measures for the “2nd plant (heattreatment facility)”
In 2007, Reterra built a heat treatment plant in an industrial park to help increase
the strength of its cast aluminum products. 11 years passed since its establishment,
the plant has seen an increase in nighttime work alongside increased production,
and as a result its CO2 emissions and energy consumption has been increasing year
by year. Emissions reached 390t of CO2 in FY2017, and in FY2018 all 28 of the plant’s
mercury lamps were replaced with LEDs to reduce the power consumption of ceilinglighting. On top of this, adopting the “Saitama Prefecture Energy-Saving Subsidy”
has cut power consumption in half with minimal capital investment. In FY2018,” wecould reduce the CO2 emissions of 381t of CO2 by 2.3% due to the changing to LED
bulbs.
・Before: Mercury lamps 300W x 28 lamps After updating: LED bulbs 150W x 28 bulbs
・Investment: Total of 2,020,000 yen (including Saitama Prefecture subsidy of 610,000 yen)・Reductions: Electricity 22,000kWh per year Electricity cost 418,000 yen per year 11t CO2 per year
・Return on Investment: 3.4 years

Aluminum 2nd plant

Changed to LEDs
F-TECH CSR REPORT 2019│ 28 │

CSR - Global Initiatives

North America
F&P Mfg., Inc. (F&P/Ontario, Canada)

Reducing the volume of transports by updating packing
material compression machines
Previously, the packing material used for pedals was too large to be compacted by
the facility’s compression machines prior to disposal. As such, we have upgradedto a larger model that is able to compress these materials. Up until this point, onlyaround 60 boxes could be loaded per trailer, and 5 trailers were sent per month
to processing to facilities. After the upgrade, the load capacity per vehicle wasconsiderably increased, resulting in a reduction of 19 trailer loads per year and a cost
reduction of $13,860 per year. Furthermore, the number of forklifts used in shipping
also decreased which has contributed to a reduction in CO2 emission.

Compressing

Inside a trailer

Dyna-Mig, a Division of F&P Mfg., Inc. (DYNA-MIG/Ontario, Canada)

Creating habitats for endangered species (Monarch Butterflies)
The monarch butterfly migrates from Mexico to North America. Ontario is one partof where monarch butterflies lay eggs and their larvae grow, but in recent years
there has been a reported dramatic decline in monarch butterfly population, and it
has now been designated as an endangered species. This is due in part to the factthat milkweed, which is the only food that monarch larvae can consume, growing
on agricultural farmland has been adversely affected by harmful chemicals andpesticides.
In 2017, DYNA-MIG sowed milkweed seeds around its rainwater collection pond.
As a result, in 2018 the amount of milkweed growing by the pond more thandoubled, and there were many monarch butterflies sighted.

F&P America Mfg., Inc. (F&PA/Ohio, U.S.A.)

Life-saving blood donations

F&PA held 3 blood donation events in FY2018, and it reached 97% of its participatory
target, reaching 74 out of a goal of 76 participants. This blood donation event has
been an ongoing project since 2011. Many of the participants at F&PA are repetitive
participants, and they look forward to contributing to society through the blood
drives.

F&P Georgia, a Division of F&P America Mfg., Inc. (F&PG/Georgia, U.S.A.)

Etowah River cleanup event

On September 15th, 2018, 100 people participated in the Etowah River cleanup
event, helping to remove 1,800 pounds (0.9 tons) of waste from the river. Protecting
rivers from pollution is extremely important, as they are a source of drinking water
for many cities, and we believe that helping to create a clean water environment willlead to further ecological conservation.

Charity 5k/3k health walk
F&PG has held 5km and 3km health walks for employees and locals alike. Thesewalks have raised $8,455 in donations for employees with spouses receiving cancer
treatments.
※Donations Breakdown: Event participation fee + donations from participants│ 29 │ F-TECH CSR REPORT 2019

CSR - Global Initiatives

North America
F-tech R&D North America Inc. (R&DNA/Ohio, U.S.A.)

Support for tornado victims, and environmental activities
R&DNA regularly continues to make donations to shelters for the homeless andothers, as a contribution to local communities. In response to the large-scale
damage caused by tornadoes around the Ohio office on Memorial Day, R&DNA’s
employees took initiative and collected cleaning tools and necessities, delivering
them to affected areas.
As a result of introducing an enterprise resource planning system (ERP) for
accounting and testing, we have effectively reduced paper usage by over 50%.
Furthermore, as we placed the Sales department in the Michigan Office, we havechanged our lights from fluorescent lights to LEDs. When choosing office supplies,
not only do we consider cost, but carbon footprint* as well, seeking products likethose made of recycled materials, and when replacing company cars, we select ones
with good fuel efficiency, such as electric vehicles.
＊Carbon footprint: Abbreviation for “Carbon Footprint of Products.” A system to indicate theamount of greenhouse gas emissions created throughout a product or service’s entire life cyclefrom procurement of raw materials to disposal and converting this to CO2 using LCA (Life Cycle
Assessment).

FEG de Queretaro, S.A. de C.V. (FEGQ/Queretaro, Mexico)

Utilizing the “Social Contributions Program”
As part of their Social Contributions Program, employees and their families
participated in a tree-planting activity, planting endemic species in the La Valeta
area bordering Guanajuato. This activity aims to help prevent desertification via
reforestation. Participating in these activities provided a good opportunity for those
involved to reconsider their awareness of global warming and the importance of
maintaining a healthy environment.
We will continue to actively participate in various programs and contribute to the
local community.

F&P Mfg., De Mexico S.A.DE.C.V (FPMX/Guanajuato, Mexico)

Tree planting activities and local harmony

Mexico is an extremely hot country. Planting trees to create shade is a popular
activity because it leads to refreshment. The employees planted 30 endemic tree
species themselves, helping to maintain biodiversity in the area. We also have held
environmental lectures at nearby schools for 2 consecutive years. The students
involved took great interest, including asking questions about the environment andvoicing their concerns. After the lecture, 5 garbage cans were donated to promote
separation of recyclables.
In order to reduce power consumption, we also changed some of the 280
lights along the welding line to LEDs. As a result, we have achieved annual power
reductions of 2,580.48kWh and annual CO2 reductions of 1,173kg.

Tree planting
activities

Holdingenvironmental
lectures atschools

Donation of
garbage cans
to schools
F-TECH CSR REPORT 2019│ 30 │

TOPICSF&P Mfg. Inc. (F&P/Ontario, Canada)

Established in 1986, the Group’s First Overseas Site
The HAM* Environmental Awards
A sustainability symposium was hosted by HAM* in
Columbus, Ohio on October 30th of 2018, and there theyevaluated F&P’s activities related to waste management,
energy conservation, and biodiversity conservation.
*HAM : Honda of America Manufacturing

The company’s welding division has switched its
purchase of welding wires from a 500lb container madeof metal and fiber to a 1000lb container made of only
fiber, allowing it to be completely recycled. This reduced
waste by 50%, cut the number of visits to garbage
incinerators by 19, and has cut purchase frequency ofwire in half, saving the company $20,000 per year.
The hydro division also changed theirlaser cutting system into a moreenergy-efficient model. This new laser
cutting system has highelectricity-to-light conversion efficiency,
allowing it to be operated with 82% lesspower (217,300kWh). F&P was able tosave $30,422 on electricity, plus an additional subsidy of$23,530 from Saving ON Energy.
In F&P’s Environmental Management System, we haveset goals for employees to participate in tree planting
and cleaning activities every year. On April 27th, 2019,
F&P planted 40 tamarack trees and 10 spruce trees
provided by South Simcoe Streams Network. We also
installed various fences to protect around 40 trees from“overzealous” beavers. Furthermore, over 150 of the trees
we have previously planted have been maintained with“tree preservation materials.” The company also learned
about reeds, which are designated as an invasive
non-native species, and has helped to suppress theirspread by cutting off the seed-bearing tops of over 1,000
reeds.
│ 31 │ F-TECH CSR REPORT 2019

F&P is one of F-tech’s 6 North
American subsidiaries, and it
was established in Novemberof 1986 as the Group’s firstoverseas site. From its humble beginning with just 2
presses, it has grown into a company that produces avariety of parts.
The company brought in a 3,500t servo press in 2017.
Address: 1 Nolan Road, Tottenham,
Ontario, Canada, L0G 1W0
Employees: About 840
Area: Site area 417,000 ㎡
Building area 24,100 ㎡
Products: Primarily produces parts for Honda vehicles,
including the Civic and CR-V, 60 million parts annually
Recent Awards
Green Excellence Awards Waste Management, Energy, andBiodiversity Protection (2018),
Honda Quality Performance Award/Honda Delivery Award(2016)

Waste Reduction Activities
Production Flow – New Product Life Cycle

Cardboard
compressor

Set aside parts forreuse, recycling,incineration, andexhaustSupport withrubber bands

Flooring

Tension bar

To incineration
facility

Lifting strap
Returning to
manufacturer for reuse

CSR - Global Initiatives
CSR体制

Asia
F-tech Philippines Mfg., Inc. (FPMI/Laguna, Philippines)

Raising Employee Awareness Through Tree-Planting Activities
In October of 2018, as part of its social contribution to the Philippines governmental
projects, FPMI held tree-planting activities along with FR&DP and the Departmentof Environment and Natural Resources. With the help of 61 volunteers, we planted
a total of around 1,500 seedlings, including mahogany, oak, and coffee trees in
Siniloan, Laguna. This National Greening Program aims to address and mitigate not
only forest conservation, but poverty, food security, conservation of biodiversity,and climate change. Through these activities, we are working to raise employee
awareness of the importance of environmental conservation.
F-tech F&D Philippines Inc. (FR&DP/Laguna, Philippines)

Activities to Support the Future of Young People
FR&DP and FPMI joined together to participate in Brigada Eskwela 2018. Brigada
Eskwela is an activity led by the Ministry of Education in which various organizations
and guardians help children to prepare for the upcoming semester of public
elementary school.
This year, we were in charge of 2 elementary schools in the Biñan area, andwe cleaned classrooms, organized and tidied up, performed environmental
maintenance on the walls’ paint, and donated drinking glasses to the schools’
cafeterias. In addition, we participated in tree-planting activities related to thegovernment’s national greening program in Siniloan, Laguna, and FR&DP wasinvolved in planting 1,500 seedlings. Both of these activities were done with the aimof supporting the future of youth in the Philippines.
Furthermore, the in-house event Family Day gives an opportunity to teachchildren how to recycle as part of raising environmental awareness.
F-tech Mfg., (Thailand) Ltd. (FMTL/Ayutthaya, Thailand)

Trading garbage for eggs/tree-planting
FMTL is committed to environmental education and raising awareness ofenvironmental activities, and alongside our raising of awareness for environmental
protections, it also continues to promote the understanding of our employees
through environmental protection activities.
As a part of an environmental education, FMTL created a system in which
garbage that is sorted and brought to the secretariat can be exchanged for eggs.
For example, 10 PET bottles can be traded for 1 egg. Sorted and collected garbage
is then sent to a recycling company for funds, which are used for purchasing eggs
or donated to local temples. Garbage is simply waste if you throw it away, but by
sorting it you can instead recycle with a tangible return of funds.
Furthermore, it has planted trees in an effort to prevent the destruction ofmangrove forests, which have been deteriorating rapidly in recent years due to salt
exploitation and shrimp farming. These activities have helped to restore mangrove
forests and preserve their aquatic ecosystems and breeding grounds.
PT.F-TECH INDONESIA (FTI/Karawang, Indonesia)

Health checkups and food provisions for children of local
residents/donations to orphanages
Since the start of operations in 2008, the KIIC industrial park (Karawang International
Industrial City) where FTI is located has run a joint CSR program and baby foodinitiative, supplying and distributing baby food to children in nearby villages on
the same dates as children’s medical health checkups. As cooperation with nearby
villages is important in the advancement of Indonesian businesses, we participate
alongside other KIIC companies in visiting each nearby village. This time, thecompany’s employees will also be participating in this project, aiming to deepen
their awareness of social contributions to the community.
Furthermore, as part of our regular CSR program, it participates in welfare
activities at orphanages near the industrial park. All employees participated, joining
with religious leaders to donate food for around 20 orphans.
F-TECH CSR REPORT 2019│ 32 │

CSR - Global Initiatives

China
F-tech R&D (Guangzhou) Inc. (FR&DCH/Guangdong, China)

Updating to a low-noise cooling tower

FR&DCH had an urgent need for management to evaluate noise complaints comingfrom residents of adjacent apartments as well as to look into environmental impacts
as dictated by the Environmental Protection Administration and improve thesematters.
Initially, noise complaints from the adjacent apartment residents about thecooling tower resulted in the installation of noise reducing barriers, but this had
no noticeable effect. After visiting a client site that had installed a cooling towerthat met new specifications, we noted that the tower was exceptionally quiet andoperated far below noise standards. FR&DCH immediately decided to replace
the cooling tower with this new specification, and after comparing power andnoise generation, we finally selected a new model that offered low noise, easy
maintenance, ready assembly, and a small necessary area.
After this update, we no longer receive noise complaints from residents of theadjacent apartments, and in August 2018 we received a certificate from the State
Environmental Protection Administration(SEPA).

F-tech Wuhan Inc. (FTW/Hubei, China)

Improving water consumption in the paint wastewater
treatment process

Before update

After update

Improvement of water solution for paintwastewater treatment chemicals
The paint wastewater treatment chemicals dissolve
in tap water. This chemical solution water results inwater consumption of 280t per month.

F-tech Zongshan Inc. (FTZ/Guangdong, China)

Reduction in painting process spray

Produced water
is reused todissolve powder
chemicals in
untreated water
tanks

Water supply tank
Water supply circuit

Biologicalsedimentation
tank
ActivatedsludgePassed produced water after treatment

The paint wastewater treatment process utilizes 5 chemicals (FeSO4 , Ca(OH)2 , NaOH,
PAC, PAM) that are dissolved into water, and this process consumes 280t of water
Dissolve
Water pipechemicals
per month.
by waterOur plumbing has been reviewed so that FTW may reuse the treated water
already used in the wastewater treatment process, and we aimed to reduce water
Sensor equipment
consumption by reusing this water to dissolve paint treatment chemicals. The piping
Explanation of water supply control system
for treated water is connected to the water pipe, allowing for automatic supplying
5 tanks, each with a capacity of 1.5t, for a totalof 7.5t. Investment for improvements was 30
of water based on the water level of the supply tank. After this update, it is able toyuan, resulting in a reduction in annual water
consumption of 3,360 tons and a reduction indissolve all 5 types of chemicals used in wastewater treatment in the reused water,water bill of 10,517 yuan.
reducing our annual water consumption by 3,360t per year and reducing water
Changed to reuse of produced water Previous water circuit
Produced wastewater treatment system
Interlocking control auto-valve
costs by 10,000 yuan per year.

Automatic spray by automatic sensor
In order to maintain contamination levels set in the painting line operational
configuration, around 5.6t of water is supplied and drained per hour. FTZ looked
into reducing the water consumption used in this process. As a result, it decided
that, if appearance remained satisfactory, we could reduce the amount of cleanwater needed for washing after the UF process.
Reduction in painting process spray
FTZ began by stopping the clean water spray used after UF, and as a
Installed sensor
Bars for detectors
result we were able to identify that 46 out of 150 parts had issues, including(for automated spray)(Set on hangers for spray installations)drippage. As such, we found that it could reduce our water consumption
by 32t per day by spraying only the parts that caused drippage. With aninvestment of 20,000 yuan, FTZ able to save 7,680t of water and 169,113
yuan annually.
Furthermore, reduction of the wastewater created also decreased thechemicals needed for the treatment of wastewater, leading to an overall
positive environmental impact. As a total effect, this resulted in a savings Improvement Plan: Make improvements so that spraying
is only done to parts where drippage occurs.
of 180,000 yuan per year.

│ 33 │ F-TECH CSR REPORT 2019

Data●●●●●
Collection
Sales results by customer(Unit hundred million yen)
2,500

0.2%
1.3%
2.7%
3.4%

Others
FTC

2,000

4.4%

3.1%

Suzuki
1,500

Mitsubishi
12.9%

Toyota

1,000

72.0%

Nissan
500
0

GM
Honda
2013

2014

2015

2016

2017

Operating income and Operating margin

2018

ROE・ROA

Operating income
Operating margin （%）
4.5(Unit million yen)
9,000
8,000

4.0

16

7,000

3.5

14

6,000

3.0

12

5,000

2.5

10

4,000

2.0

8

3,000

1.5

6

2,000

1.0

4

1,000

0.5

2

0.0

0

0

2013

2014

2015

2016

2017

2018

(Unit hundred million yen)

（%）

1,600

35

1,400

30

1,200

25

1,000

2013

2014

2015

2016

2017

2018

2015

2016

2017

2018

20

800

15

600

10

400

5

200
2013

2014

2015

2016

2017

2018

Current net earnings per share

0

2013

2014

R&D expenses/Capital investments

(Yen)
300

R&D expenses(Left axis)
Capital investments(Right axis)(Unit hundred million yen)

250
200
150
100
50
0

ROE

Capital-to-asset ratio

Total assets

0

ROA

（%）
18

2013

2014

2015

2016

2017

2018

40

320

35

280

30

240

25

200

20

160

15

120

10

80

5

40

0

2013

2014

2015

2016

2017

2018

0

F-TECH CSR REPORT 2019│ 34 │

F-TECH CSR REPORT 2019

Issuer:F-tech Inc.
19, Showa-numa, Shobucho, Kuki, Saitama Prefecture 346-0194
JAPANInquiries:

F-tech Inc General Affairs Department
TEL. 0480-85-5211 FAX. 0480-87-1290
E-mail : webmaster@ftech.co.jp

Issued in January 2020,
Next Issue : Scheduled for release in October 2020