New Frontiers of Innovation
Furukawa Electric Group
Sustainability Report

2012

FURUKAWA ELECTRIC GROUP PHILOSOPHYCORPORATEPHILOSOPHY

Drawing on more than a century of expertise in the development and fabrication of advanced
materials, we will contribute to the realization of a sustainable society through continuous
technological innovation.

MANAGEMENTPHILOSOPHY

With an eye to the future, we at the Furukawa Electric Group pledge to:s Live up to the expectations and trust invested in us by society, with fairness and integrity.
s Apply the sum total of our expertise to satisfy our customers and grow with them.
s Continuously strive to achieve world-class technological innovation, and transform
ourselves in every area of endeavor.
s Nurture human resources at every level, so that we can become a more diverse andcreative organization.

THE FURUKAWA
ELECTRICGROUP CREDO

1. Maintain high ethical standards, and value honesty and integrity above all.
2. Continually improve, innovate, and lead, in every area of endeavor.
3. Take a hands-on approach that addresses the reality of every situation—in the office,at the factory, and on site.
4. Be proactive—take the initiative and work with others, persevering until a solution is found.
5. Maintain open channels of communication between departments and divisions, so that
we can share ideals and help each other grow.

Editorial Policy
outlining our acquisition of SuperPower, Inc. of the UnitedStates. In this section, we explain our efforts to accelerate
operations in the superconducting business by providing an
overview of current conditions and our goals for the future.
This report includes information of particularly high priority;
other CSR-related information is contained in the CSR Data
Book, English-language financial information is provided in the
Financial Review, and other detailed data can be found on our
website.

Until 2011, each year Furukawa Electric published a CSR
Report, detailing its corporate social responsibility (CSR)
activities, and an Annual Report, which reported on
operational and financial conditions.
However, we have now combined this information fromthe standpoint of the Furukawa Electric Group’s sustainability.
Accordingly, the 2012 version of these reports is a combined
Sustainability Report. This initial report contains a message
from the Group’s new president and a special feature

Scope of This Report
Accuracy of the Data Disclosed in This Report
In order to maintain accuracy in data disclosure, the information
provided in this report has been vetted by the divisions incharge of the relevant information, the Investor & Public
Relations Unit and the Administration Department of the CSR
Division, which is in charge of editing this report. We have also
provided a third-party opinion so as to offer the point of view ofan outside expert.
We are looking into obtaining third-party assurance ofreport content in the future.

Organizations Covered
This report covers Furukawa Electric Co., Ltd. and all membersof the Furukawa Electric Group, including affiliated companies.
Period Covered
From April 1, 2011 to March 31, 2012
* Includes selected information on past initiatives and activities during
fiscal 2013.

Scope of Data Covered
This report covers Furukawa Electric Co., Ltd. and its 116
consolidated subsidiaries. Exceptions to the scope of the datacollected have been clearly stated.

Websitehttp://www.furukawa.co.jp/english/csr/index.htm

Publication Timeframe
Publication date: September 18, 2012
Planned publication of next edition: September 2013 (previous
edition published in November 2011)

Source Guideline

Furukawa Electric Group Sustainability Report 2012OUTPUT

G3 Performance Indicators &Sector Supplement
Performance Indicators

Report on a minimum of 10
Performance Indicators,
including at least one from eachof: Economic, Social andEnvironmental.

* Sector supplement in final version

Management Approach
Disclosures for each Indicator
Category
Report on a minimum of 20
Performance Indicators, at least
one from each of Economic,
Environmental, Human rights,
Labor, Society, ProductResponsibility.

B+

A

A+

Same as requirement for Level B

Management Approach
Disclosures for each Indicator
Category
Report on each core G3 andSector Supplement* Indicatorwith due regard to theMateriality Principle by either:a) reporting on the Indicator orb) explaining the reason for its
omission.

Report Externally Assured

Not Required

B
Report on all criteria listed forLevel C plus:
1.2
3.9, 3.13
4.5-4.13, 4.16-4.17

Report Externally Assured

G3 Management
Approach Disclosures

C+

Report Externally Assured

Report on:
1.1
2.1-2.10
3.1-3.8, 3.10-3.12
4.1-4.4, 4.14-4.15

OUTPUT

1

G3 Profile Disclosures

OUTPUT* Please refer to page 46, “GRI Guideline
Table of Contents” which shows thecorrespondence of this report to the
GRI Guideline.

C

Report Application Level

Standard Disclosures

We referred to the GRI “Sustainability
Reporting Guideline 2006 (3rd Edition)”*and the Ministry of the Environment’s“Environmental Reporting Guideline 2007
Edition” in composing the Furukawa
Electric Group Sustainability Report2012.
Our own assessment places thisreport at the “B” standard in the GRI
Application Level.

Inquiries
Administration Department, CSR Division
Furukawa Electric Co., Ltd.
TEL: +81-3-3286-3044 FAX: +81-3-3286-3920

New Frontiers of Innovation
Furukawa Electric Group
Sustainability Report

Initiatives for the Environment

Condcting Projects
Related to Biodiversity

P.26

2012

Special Feature

Becoming a Top
Global Supplierin the Field ofSuperconductors

Strengthening Management

Receiving the 2011
BCAO Award

P.42

P.11
P.30

Initiatives for Society

Holding the Fourth
Plant Tour for
Individual Investors

Contents
Furukawa Electric Group Philosophy/
Editorial Policy

01

Initiatives for Society

27

Contents

02

Relations with Our Customers

28

Furukawa Electric Group Overview

03

Relations with Our Shareholders

30

AT A GLANCE

05

Relations with Business Partners

31

President Message

07

Relations with Our Employees

32

Special Feature

11

Relations with Communities

37

Initiatives for the Environment

17

Strengthening Management

39

Environmental Management

18

Corporate Governance40

Environmental Education

19

CSR Management

41

Material Flow

20

Targets and Performance (Environment)

21

Targets and Results

44

Environmentally Sound Products

22

Environmentally Conscious Production/
Chemical Substance Management

Third-Party Opinion

45

23

Environmental Risk Management

GRI Guideline Table of Contents

46

25

Biodiversity Preservation

26

Becoming a Top Global Supplierin the Field of Superconductors

Furukawa Electric Group Sustainability Report 20122

Furukawa Electric Group Overview

Furukawa Electric Group Overview*1
Net sales
918.8 billion yen (Consolidated, fiscal year 2012)

Net sales by Main Business Segment (Consolidated)

Number of employees
45,425 (Consolidated, as of March 31, 2012)

14.4%¥144.5 billion

Number of companies
135 (116 subsidiaries and 19 affiliates accounted for using
the equity method)

Energy andIndustrial products

Telecommunications*1 There were no major changes in terms of organizational scale, structure orownership during the reporting period.
*2 Figures excludes intersegment transactions

Electronics and Automotive systems

21.2%¥212.0 billion
Total:

Metals¥918.8*2

27.2%¥272.2 billion

14.1%¥141.6 billion

billionServices and Others

Light metals

3.6%¥36.5 billion

19.5%¥195.6 billion

Furukawa Electric Group Corporate Profile
Name

Furukawa Electric Co., Ltd.

Domestic bases

Headquarters
location
President
FoundedEstablishedNet sales

2-3 Marunouchi 2-chome, Chiyoda-ku,
Tokyo 100-8322, Japan
Mitsuyoshi Shibata
1884
1896
403.7 billion yen(Non-consolidated, fiscal year 2012)
4,192(Non-consolidated, as of March 31, 2012)s Head Office

Number of
employeess Branch Offices
Hokkaido Branch Offices,Tohoku Branch Offices,
Chubu Branch Offices,Kansai Branch Offices,
Chugoku Branch Offices,Kyushu Branch Officess Branches
Hokuriku Branch,Shikoku Branch,Okinawa BranchWorks, Research Laboratories
Bases

Works

Research Laboratories

Nikko,Tochigi
Ichihara,Chiba
Yokohama,Kanagawa
Hiratsuka,Kanagawa
Kameyama,Mie
Amagasaki,Hyogo

Nikko Works Copper Foil Division
Chiba Works
Yokohama Works
Hiratsuka Works
Mie Works
Copper Tube Division

Metal Research Center
Power & System Laboratories, FITEL Photonics Laboratory
Yokohama R&D Laboratories
Ecology & Electronics Laboratories, Power & System Laboratories, R&D Center for Automotive Systems & Devices

WEB

Domestic Network

http://www.furukawa.co.jp/english/kaisya/01-03.htm

Results (Consolidated)
Net Sales by Region

Operating Income

Domestic
North America
China (including Hong Kong)
Southeast Asia, South Korea, Taiwan
Other(Billions of yen)(Billions of yen)

1,174.2
1,032.8

1,200

809.7

925.8

60

918.8

800

40

400

20

48.4
35.1
20.3

0

3

2008

2009

2010

2011

Furukawa Electric Group Sustainability Report 2012

2012

(FY)

0

15.9

9.8
2008

2009

2010

2011

2012

(FY)

Operation BasesEuropeNorth America

Asia
Central/South America

No. of Employees by Region

Furukawa Electric
Overseas subsidiary or affiliate

Japan

Europe, other

14,214523

Representative office

North/South America

5,239
Asia

WEB

25,449Overseas Network (Details)

http://www.furukawa.co.jp/english/kaisya/01-04.htm

Total Assets/Net Assets

Research Expense/Capital Investment

Total Assets(Billions of yen)

Research Expense(Billions of yen)

1,200

Net Assets

845.7

835.8

826.9

400

0

30

2008

190.4
2009

208.9
2010

215.9
2011

41.3

40

790.1

800

295.0

45.3

50

1,014.8

Facility Investment

19.8

19.9

20

197.6
2012

27.9

25.4
17.3

18.3

33.6
19.0

10
(FY)

0

2008

2009

2010

2011

2012

(FY)

Furukawa Electric Group Sustainability Report 2012

4

AT A GLANCE
Related to Transmission Infrastructure

Net Sales Ratio
Telecommunications

14.4%

Energy andIndustrial Products

27.2%

Related toTransmission
Infrastructure

Services andOthers

3.6%

Energy and Industrial Products

sOptical Fiber and Cable BusinesssPhotonics and Network Solutions
BusinesssEnergy BusinesssIndustrial Products BusinessElectronics andAutomotive Systems

21.2%
14.1%

Net Sales
Operating
IncomeRelated toFunctional
Materials

Light Metals

19.5%

Furukawa Electric Group Sustainability Report 2012

27.2%

14.4%

MetalsThe Furukawa Electric Group isconcentrating on businessdevelopment in two areas: thetransmission infrastructure business,for which substantial demand growthis expected in emerging markets, andthe functional materials business, ahigh-value-added sector in which we
can leverage the Group’s uniqueadvantages in materials.

5

Telecommunications(Billions of yen)(Billions of yen)

FY2010 FY2011 FY2012

FY2010 FY2011 FY2012

135.5 149.3 144.5
9.6
4.1
9.8

Net Sales
Operating
Income208.8 253.0 272.2
3.7
0.9 -0.8

Fiscal 2012 Topics

Fiscal 2012 Topics

sFurukawa Industrial S.A. Produtos
Electricos (FISA) in Brazil acquired
Metrocable Industria e Comércio Ltda,
which manufactures and sells opticalfiber cablessRiken Electric Wire to establish joint
venture in elevator cable business with
Hebei Huatong Wires & Cables GroupsAcquired SuperPower, Inc., a U.S.
manufacturer of second-generation
high-temperature superconducting
wire

Measures in Fiscal 2013

Measures in Fiscal 2013

sEstablish joint venture in China to
produce and sell optical fiber preform(July 2012)

sStart production at new optical fiber
compound overhead ground wires(OPGW) plant at FISA in Brazil(October 2012)

sBuild new optical cable plant in Russia(July 2013)

sEstablish company integrating three ofour electric component companies(October 2012)

Major Products

Major Products

Optical fiber cables, optical fiber cable
accessories and installations, opticalcomponents, optical semiconductor
devices, metal communication cables,
electronic appliance wires, network
equipment, CATV systems, radio
products

Copper wires, aluminum wires, powertransmission cables, power transmission cable accessories and installations,insulated wires, cable conduits,water-feeding pipe materials, foam
products, UV tapes for semiconductor
manufacturing, electrical insulation
tapes, electric material products

Related to Functional Materials

Electronics and Automotive Systems

MetalsLight Metals

sAutomotive Parts BusinesssElectronics Components BusinesssMagnet Wire Business

sCopper Strips Business
sCopper Pipes Business
sCopper Foils BusinesssAluminum Rolling BusinesssAluminum Extrusion BusinesssAluminum Casting, Forging and OtherNet Sales
Operating
Income

19.5%

14.1%

21.2%
(Billions of yen)(Billions of yen)(Billions of yen)

FY2010 FY2011 FY2012

FY2010 FY2011 FY2012

FY2010 FY2011 FY2012

177.2 209.6 212.0
5.1
7.2
7.8

Net Sales
Operating
Income119.6 152.9 141.6
0
- 2.2
3.2

Net Sales
Operating
Income188.1 209.0 195.6
5.7- 0.2 11.5

Fiscal 2012 Topics

Fiscal 2012 Topics

Fiscal 2012 Topics

sAcquired controlling interest in
ChonQing Chang Hua Automobile
Harness in China and expand wire
harness businesssRevised system for domestic
production of copper pipes

sFurukawa-Sky to invest in ARCO
Aluminum of the United States

Measures in Fiscal 2013

Measures in Fiscal 2013

Measures in Fiscal 2013

sStart production at new wire harness
plant in the Philippines (March 2013)

sCommence production at new plantfor electrodeposited copper foil (usedin circuits and batteries) in Taiwan(June and August 2012)sFurukawa-Sky to build aluminum
rolling mill in Thailand (January 2014)

Major Products

Major Products

Major Products

Automotive components and wiring
harnesses, magnet wires, electronic
component materials, heat sinks, harddisc drive (HDD) aluminum blanks,
battery products

Wrought copper products (plates,
strips, pipes, rods, wires), functionalsurface (plating) products, Electrodeposited copper foils, processed
products for electronic parts, superconducting products, special metalmaterials (shape-memory and superelastic alloys)

Aluminum plates, extruded aluminumproducts, castings, forged products,
processed light metal productssAcquired Automotive Connector
Business from Mitsubishi Cable
Industries

Furukawa Electric Group Sustainability Report 20126

President Message

We will contribute to improving energy efficiency
by utilizing our unique materials expertise.

Mitsuyoshi Shibata
President
ProfileBorn in Tokyo in 1953. Graduatedfrom the Department of Metal
Materials, Faculty of Engineering, The
University of Tokyo, and joined
Furukawa Electric in 1977. Beginningin with production technology in thecompany’s copper wire plant,
experienced the development andcommercialization of semiconductor
lasers before heading the Patent &Licensing Department, the Yokohama
R&D Laboratories, the Corporate
Strategy Planning Department, andthe Metals Company. Following abroad range of experiences, including
the overseas investment related tocopper foil and restructuring of thecopper pipe business, appointed
President in April 2012.

7

Furukawa Electric Group Sustainability Report 2012

My name is Mitsuyoshi Shibata, and I was appointed
President on April 1, 2012. I would like to thank all of our
stakeholders for their ongoing support. Having taken thereins of the Furukawa Electric Group during such difficult
times, I feel a strong sense of the seriousness of my task.

Review of Fiscal 2012
Japanese industry has faced a drastically changing
environment over the past several years, and the
Furukawa Electric Group now confronts a situation inwhich we must fundamentally reconsider the businessstructure in place up to now. Although there was somerecovery after the Great East Japan Earthquake in fiscal
2012, the economic environment has continued to bedifficult, due to factors such as the global economic
slowdown, the persistently strong yen against the dollar
and the euro, and the Thailand floods.
The Furukawa Electric Group has taken measuresin the face of such headwinds, such as a complete
withdrawal from the glass substrate business and thestreamlining of our copper tube operations in Japan, but
at the same time we also engaged in growth initiatives
such as expanding capacity for production of copper foil
for lithium-ion batteries and expanding the range ofapplications for microcellular foamed sheet (MCPET).
Also, through our acquisition of the U.S. company
SuperPower, Inc., the Furukawa Electric Group became
the world’s only total supplier of second generation
high-temperature superconducting products, offering
everything from wire through equipment. We also
advanced our aluminum business globally by building
new production bases in North America and China.
Nonetheless, the Furukawa Electric Group’s
consolidated results for fiscal 2012 reflect decreased

revenue and earnings due to factors such as the difficult
operating environment and the fine paid for violating U.S.
antitrust laws, which was posted as an extraordinary
loss. This has forced us to forego payment of a year-end
dividend.

Embark on Reform for Real Victory
Taking the above into account, I view the Furukawa
Electric Group as having reached a stage where thesteps we take toward structural reform must be morebold and effective than ever before—we must embark onreform for real victory. As we are engaged in a diversity ofbusinesses, determining the direction of the Group andwhere to invest in also entails deciding which businesses
require streamlining. We are looking into measures suchas integrating operations in the optical fiber businessglobally, reorganizing production bases in the domestic
optical cable business to attain improved earnings, andaccelerating the shift from domestic production ofcopper foil and other products to overseas production.
While that reorganization takes place we will also
strengthen business in the social infrastructure sector,
including energy and telecom, as well as in the nextgeneration vehicle sector, in which better environmental
features are called for. Our goal is to build a businessstructure capable of handling even greater demand fromglobal growth markets.

For a Sustainable Society
The world is currently facing some major energy issues,
including steep rises in oil prices and the environmental
impact of mass consumption of fossil fuels. For the world

Furukawa Electric Group Sustainability Report 20128

President Message

to achieve sustainability, countries around the globe must
make progress in energy conservation and expand theuse of renewables. Energy supplies must be stabilized
while environmental impact is brought under control.
Furukawa Electric has been manufacturing andproviding useful products made from a variety ofmaterials, such as copper, aluminum, and plastic, since
our founding in 1884. In recent years we have beenusing our unique materials expertise to help solve global
issues, such as energy conservation and energy supply
stability. Our R&D is focused on three categories—nextgeneration vehicles, energy/smart grids, and high-density
optical telecommunications. The Furukawa ElectricGroup will concentrate our maximum materials
technology on achieving energy efficiency in each of
those categories.
For example, switching from copper wire harnesses
to lighter aluminum wire harnesses for the internal wiringof next-generation vehicles helps improve fuel economy
by making the vehicle lighter. We are also engaging in
the energy/smart grid sector by developing high-volumestorage batteries, which are vital to renewable energy

power plants because of susceptibility to fluctuations in
power demand due to seasonal changes, as well as
superconducting electric power cables andsuperconducting magnetic energy storage (SMES) units
that broadly reduce power loss during transmission. Our
efforts in the high-density optical telecommunications
field include responding to the switch from metal to fiber
for large computer internal circuitry, and we areproceeding with optical interconnection development for
improved speeds and lower power consumption.
To develop new energy sector businesses, weestablished the Offshore Wind Power Project Team in
March 2012 and the High-Temperature
Superconductivity Business Development Team in April.
We will contribute to solving social issues while at thesame time adding new value to the businesses of ourcustomers through our R&D and business development
focusing on environment and energy. Superconductivity
is a technology noted for its potential to create
fundamental change in our existing energy infrastructure.
We are evolving our business focus toward leading theworld in superconductivity technology. Please see theSpecial Feature (pages 11–16) for details.

Resolving Environmental Issues
Environmental conservation is our responsibility to thenext-generation, and as a socially responsible company
we are tackling environmental issues head-on. The
Furukawa Electric Group not only addresses societal
issues by reducing the environmental impact of products,
we also are moving forward with the indexing of productenvironmental performance based on lifecycle
assessment (LCA) methodology, which broadly

9

Furukawa Electric Group Sustainability Report 2012

contributes to creating value for the customer. We
emphasize environmental contribution in conducting ourbusiness, and promote environmentally themed R&D.
The Furukawa Electric Group also announced
efforts to promote biodiversity in fiscal 2011, through ourefforts emphasizing eco-system impact assessment,sustainable use of resources, and increasing theawareness of each employee. During fiscal 2012, we
focused on eco-system impact and conducted risk
assessments on biodiversity in all fields of Groupbusinesses. Taking the results of those assessments into
account, we plan to establish a Long-Term
Environmental Vision and Activity Guidelines, so as topromote environmentally-conscious management acrossthe entire Group value chain.

Restoring TrustAs announced in September 2011, Furukawa Electric
paid a fine of US$200 million as part of a plea agreement
made with the United States Department of Justicerelated to cartel activities for automotive wire harnesses
and related products. Furukawa Electric Group formed
the “Third-Party Investigation Committee on Violations of
the Anti-Monopoly Act” in 2009, and in December of thatyear that Committee announced its findings. In parallelwith the Committee’s activities, a thorough investigation
by outside legal counsel was carried out. This
investigation confirmed that all conduct suspected ofbeing in violation of the Anti-Monopoly Act had ceased,
and all illegal conduct had been eliminated by the time
the Committee’s report was issued. Although theautomotive wire harnesses case concerned past
conduct that was found by outside legal counsel

investigation rather than any new occurrences of illegal
conduct, we once again humbly ask the forgiveness ofour stakeholders for any distress or trouble this incident
may have caused.
We are working to restore public trust by enforcing
strict compliance at all affiliated companies in Japan andoverseas. We are focused on building a global
compliance structure through efforts this fiscal year suchas conducting compliance seminars in China andsupporting effective risk management and internal
controls at overseas bases.
As noted in the Furukawa Electric Group Corporate
Philosophy, contribution to the realization of a sustainable
society is our core principle. To realize this philosophy,
we are aware that we must maintain close
communications with society so as to meet our
stakeholders’ desires and expectations, and are also
aware that we must fulfill our corporate social
responsibilities fully so as to remain an indispensable
corporate citizen. It is my sincere hope that we may
continue to enjoy the support of our stakeholders.

Mitsuyoshi Shibata
President

Furukawa Electric Group Sustainability Report 201210

Special Feature
By leveraging the proprietary technology we have accumulated overmany years with technologies acquired through M&A activities,
we are working to

Become a Top Global
Supplier in the Fieldof Superconductors.
Furukawa Electric has conducted R&D in the fieldof superconductors since the 1960s, and has
amassed some of the world’s leading technologies
in this sector.
In February 2012, we acquired
SuperPower Inc. of the United States,
one of only a few companies in the world
currently manufacturingsecond-generation high-temperature
superconductor wire materials.
We converted this company
to a subsidiary in order tobolster our competitivenessin world markets.

Electricity

Raising
generation
efficiency

storage
Electricity

creation
Electricity

transmission
11

Furukawa Electric Group Sustainability Report 2012

Storing large
amounts of electricity
without losses

Lowering
transmission loss

Special
FeatureBecoming a Top Global Supplierin the Field of Superconductors

Successes Based on a Half Century of R&D Have
Led Us to Possess Some of the World’s Leading
Technologies in the Superconductor Field.
Against the backdrop of increasingly severe global warming and electric power risks, throughout theworld interest has grown in the practical application of superconductor technologies to use energy
more effectively. Since the 1960s, Furukawa Electric has the leading role in R&D of superconducting
technologies. Over that time, our efforts have included the spectrum of activity from low-temperature
superconductivity using metallic materials to high-temperature conductivity with oxide materials. In
the process, we have accumulated some of the world’s leading technologies in this field.
2003
Delivered cables for the Large Hadron Collider
at CERN*1, becoming the first company in theworld to provide detection equipment forlarge-scale conduction
Based on this performance, won the Golden
Hadron Award*2

Furukawa Electric’s Efforts
1963
Commenced R&D on low-temperature
superconductivity
Began industrial production of NbTi
multicore wire

2005
Performed field test on 500 m
superconducting cable, the longest
in the world at the time, at theCentral Research Institute ofElectric Power Industry*3

1973
Became the first in
the world tosucceed in
producing ultrafine
multicore wireusing a compoundof V3Ga and
Nb3Sn
1960

1970

1980

2007

2011

Constructed a large-scale accelerator,
developed a model coil for research into
nuclear fusion, conductedsuperconducting generator verification
testing and participated in otherlarge-scale projects in Japan andoverseas

Achieved the world’s
lowest transmission
loss throughapplication ofultrafine wire
processing
technology and cableforming technologythat reduces theperpendicularmagnetic field*4

Developed the world’s
highest-voltage 275 kVsuperconducting cable*5

1986
Commenced R&D into high-temperature
superconductivity

1980

Worldwide Evolution ofSuperconducting Technologies

1990

2000

1987 Yttrium superconductor material (2G HTS) discoveredat the University of Houston, in the United States

1911 Phenomenon of superconductivity first discovered atLeiden University in the Netherlands, using mercury

1953 Nb3Sn discovered to be a practical metallic
superconducting material

1957 BCS theory proposed to explain superconductivity*1 The European Organization for Nuclear Research (CERN), which announced the discovery of the Higgs
particle to a high degree of certainty in July 2012
*2 Golden Hadron Award: Prize awarded by CERN to manufacturers determined to have contributed
substantially to the LHG plan
*3 NEDO “Project for R&D on Basic Technologies for Superconducting AC Equipment”

2012
Through the acquisition of
a U.S. company, became
the world’s only integrated
manufacturer of
second-generation
high-temperature
superconducting materials

2010

2011
Marked the 100th
anniversary of the
discovery of thephenomenon ofsuperconductivity.
Ceremonies held inJapan and overseas*4 NEDO “Project for the Development of a Technological Base for the
Application of Superconductivity”*5 NEDO “Technological Development of Yttrium-based Superconducting
Power Equipment Project”

Commenced Verification Testing in Chinaof the World’s Highest-Voltage Superconducting Cable
In the Chinese city of Shenyang, the Furukawa Electric Group will conduct
long-term loading cycle tests of the world’s highest-voltage 275 kVsuperconducting cable in October 2012. This test was commissioned by the New
Energy and Industrial Technology Development Organization (NEDO) as part of its“Technological Development of Yttrium-based Superconducting Power Equipment
Project.” By conducting verification testing in China, where demand for transmission
infrastructure is rising sharply, we aim to demonstrate the technological superiorityof superconducting cables and enhance our international competitiveness.

275 kV superconducting cable test layout

Furukawa Electric Group Sustainability Report 201212

Special
FeatureBecoming a Top Global Supplierin the Field of Superconductors

Meeting Expanding Demand for Superconductivity
in Regions throughout the Worldby Using Smart Grids as Key Materials
Now that a century has passed since the phenomenon of superconductivity was first
discovered, technological development and commercialization is accelerating. In particular,
attention is focusing on the use of smart grids, which are anticipated for use innext-generation social infrastructures. By adding the second-generation high-temperature
superconductor (2G HTS) wire production technology of SuperPower, Furukawa Electricplans to reinforce its lineup of technologies aimed at realizing smart grids. We provide
advanced technologies and products in a host of fields related to the generation,transmission and storage of electricity.

Superconducting Cable Demand Forecast

Lowering
Transmission
Loss(based Furukawa Electric’s calculations)(Billions of yen per year)

Electricity

transmission

9

We help to transmit the electricity thatpower plants generate in a stablemanner and without losses.
The electrical resistance of power cables means thatsome energy is lost when electricity is sent from power
stations to locations where the power is used. In Japan,
where reducing the use of electricity has become an
important issue for society as a whole, approximately
5% of power is lost during transmission.
Cables that use superconducting technologies haveno electrical resistance, so transmission losses are
greatly reduced. By 2050, we estimate thatapproximately 4,000 km of copper cable will be
replaced with superconducting cable, reducing annual
power consumption by 3.1 billion kilowatts for every 2.6
million people. This equates to a decrease in the CO2
emitted during generation of 1.06 million tons (based
Furukawa Electric’s calculations).
Combining SuperPower’s
technologies in the mass
production and lengtheningof 2G HTS materials with
Furukawa Electric’s
technologies in power cables
will enable the mass
production ofsuperconducting cables ofhigher quality and at a lower
price. This combination
should enable us to meetincreasing global demand.

13

Furukawa Electric Group Sustainability Report 2012

34

9
20

2020

2030

Europe

10
5

2020

2030

China
Total

2020

2030

Japan

2030

¥64.0 ¥102.0
2020

billion/year

billion/yearStoring Large Amounts
of Electricity without Losses

Electricity

storage

Electricity

We are using superconducting magnetic
energy storage (SMES) to stabilize supply anddemand for electric power.

49

To encourage the spread of generation from renewable energy sources such as solar andwind power, systems are needed to store excess energy and thereby offset naturalfluctuations. Rapid charging and discharging was difficult for the storage batteries used in thepast, so the industry was unable to overcome generation irregularities.
SMES, which allows large amounts of electricity to be charged and discharged
instantaneously, can help to offset power fluctuations inreal time. As a result, this technology is a subject ofgrowing attention for use in electricity storage equipment at
renewable energy generation facilities.
SuperPower’s 2G HTS wires are ideal for the coils
needed to generate the strong magnetic fields required by
SMES. Therefore, we are collaborating with ABB, theUniversity of Houston and Brookhaven National Laboratory
SMES simulation model using a toroidal coil
to develop SMES systems.

Raising
Generation Efficiency

30

Electricity

creation

By raising generation efficiency and making
generation equipment more compact andlightweight, we are contributing to theproliferation of wind power generation.

2020

2030

United States

Wind power generation is a type of sustainable energy use that is gaining popularity
throughout the world. At present, the largest wind power generators are around 5 megawatts
in scale. Technological developments will be needed to increase this amount to 10 or 15
megawatts. With conventional technologies, increasing the amount of power generated
required larger generators, which led to higher manufacturing and construction costs.
However, using 2G HTS wire, which has zero electrical resistance and high current density,means that even very thin wires can transport a large amount of electricity. This situation
results in more efficient generation and more compact and lightweight generation equipment.
At present, SuperPower is cooperating with TECO-Westinghouse and the University of
Houston on research and development of 2G HTS wire forlarge-scale wind power generators of around 10 megawatts.
Around the world, rising expectations are accelerating theuptake of large-scale wind power generation including
conducting research that will contribute to the reduction of CO2
emissions and the use of oil resources.

Furukawa Electric Group Sustainability Report 201214

Special
FeatureBecoming a Top Global Supplierin the Field of Superconductors

Through the Acquisition of SuperPower, Becoming theWorld’s Only Integrated Manufacturer of SecondGeneration High-Temperature Superconductivity Wire
Only two companies in the world are capable of mass producing second-generation high-temperature
superconductor (2G HTS) wire. Furukawa Electric has acquired one of these, SuperPower, thereby
turning the Company into the world’s only integrated manufacturer of 2G HTS wire.
In this section, SuperPower’s President Shirasaka, assigned from Furukawa Electric, and heads ofthe company’s management and sales divisions talk about synergies and the benefits of collaboration
between SuperPower and Furukawa Electric.

Combining SuperPower’s Wire Production
Technology with Commercialization
Capabilities Developed by Furukawa Electric
Yusei: The most significant element in this acquisition
was the addition of the 2G HTS wire production
technologies possessed by SuperPower to the lineup of
superconducting technologies that Furukawa Electric has
cultivated over many years. As 2G HTS wire using rareearth-based elements can be produced at a lower costthan bismuth-based first-generation materials, they are
gaining attention as the mainstream superconducting
material of the future. However, as the technologicalhurdles to producing 2G HTS wire are high, only twocompanies in the world are currently capable ofproducing it in mass quantities. By adding one of thesePresident

Senior Director, Marketing and Sales Division

Vice President, Finance and Administration

Yusei Shirasaka

Traute (Trudy) F. Lehner

Arthur (Art) P. Kazanjian

Furukawa Electric Co., Ltd.
Executive Officer
Leader, High-Temperature Superconductivity
Commercialization Team, R&D Headquarters

15

companies to the Furukawa Electric Group, we havebecome the only corporate group in the world able tosupply mass quantities both 2G HTS wire andHTS-based equipment.
Art: I understand that Furukawa Electric has conducted
research over a long period of time, from the era of
low-temperature superconductivity. SuperPower’s
predecessor manufactured metallic superconductor
wires as well, so I believe we have some points incommon. If we can integrate the 2G HTS wire production
technologies that SuperPower possesses with Furukawa
Electric’s technologies in power cables, wound wires andequipment development, we should be able to provide
even more advanced superconductor materials to world
markets.
Trudy: On the sales front, Furukawa Electric’s global

Furukawa Electric Group Sustainability Report 2012

network should be a major source of strength. Throughthis network, we will be able to provide even moredetailed support services to our customers.

Meeting Our Corporate Responsibilities andbecoming a Trusted Corporate Group in
Global Markets

Aiming to Address the Issues Society Faces by
Leveraging World-Leading Superconducting
Technologies

Yusei: Being active in global markets requires
competitive technologies and products; it also requiresthat a company be trusted by society. Furukawa Electrichas been active in CSR activities for some time; what is
the situation at SuperPower?
Trudy: Our headquarters and manufacturing operation
are located in Schenectady, New York, and wecontribute in many ways to the local community. I am on
the board of directors of the Schenectady chamber ofcommerce. In 2010, the 10th anniversary ofSuperPower’s founding, we built and contributed an
exhibit about superconductivity to the Schenectady
Museum, where I am vice president of the board oftrustees. We partner with local schools and universities topromote education in the area of superconductivity,
including teaching courses in the field and hosting
student interns.
Art: For a company to succeed, I believe that respect fordiversity is important. The engineers at our company
come from a range of different cultures andbackgrounds, which leads to the development of moreinnovative technologies. The company also has two
female managers, in addition Trudy, who is a company
director.
Yusei: This is excellent. I am pleased to hear that we arelikely to be sources of encouragement to each other on
the social contribution front, in addition to the technology
and business sides.

Yusei: As the world’s only comprehensive supplier in the
2G HTS arena, we have become highly competitive inworld markets. Going forward, we will need to think
about how to leverage this strength to meet society’s
needs.
Art: The benefit of superconducting technologies is thatthey offer zero electrical resistance, so current density ishigh. Superconducting technologies allow energy to be
used more efficiently, so they should play a significant
role in resolving energy and environmental problems.
Trudy: We are already progressing towardcommercialization with applications for power cables andlarge-scale wind power generation equipment. For wind
power generation in particular, superconducting
technologies are gaining growing attention because they
allow increases in generation efficiency and morecompact equipment, which reduces construction costs.
Art: In non-energy fields, as well, metallic
superconductor technologies are already being used in
the medical field for magnetic resonance imaging andother applications. Switching over to the use of 2G HTS
should result in higher-performance equipment that ismore compact.
Yusei: The field of energy and the environment and the
medical sector both involve some of the major issues
that society is facing. We need to recognize that
resolving these issues is one of our social responsibilities
as a manufacturer.

Furukawa Electric Group Sustainability Report 201216

Initiatives for the Environment
The Furukawa Electric Group is striving to reduce its environmental impact throughout
the product lifecycle.
18

Environmental Management

19

Environmental Education

20

Material Flow

21

Targets and Performance(Environment)

22

Environmentally Sound
Products

23

Environmentally Conscious
Production

24

Chemical SubstanceManagement

25

Environmental Risk
Management

26

Biodiversity Preservation

List of companies participating in the liaison meeting for consolidated
environmental management (Fiscal 2012)
Access Cable Company
Asahi Electric Works Co., Ltd.
Inoue Manufacturing Co., Ltd.
NTEC Ltd.
FCM Co., Ltd.
Okano Electric Wire Co., Ltd.
Okumura Metals Co., Ltd.
Kyowa Electric Wire Co., Ltd.
Furukawa Electric Ecotec Co., Ltd.
Shodensha Co., Ltd.
Seiwa Giken Inc.
Totoku Electric Co., Ltd.
FITEC Corporation
Furukawa Automotive Systems Inc.
Furukawa Sangyo Kaisha Ltd.
Furukawa C&B Co., Ltd.
Furukawa Industrial Plastics Co., Ltd.
Furukawa-Sky Aluminum Corporation

Detailed data is provided in our CSR Data Book (PDF).

http://www.furukawa.co.jp/english/csr/report/index.htm

17

Furukawa Electric Group Sustainability Report 2012

Furukawa Precision Engineering Co., Ltd.
Furukawa Techno Material Co., Ltd.
Furukawa Electric Advanced
Engineering Service Co., Ltd.
Furukawa Electric Industrial Cable Co., Ltd.
The Furukawa Battery Co., Ltd.
Furukawa Logistics Corporation
Furukawa Life Service Inc.
Miharu Communications Inc.
Riken Electric Wire Co., Ltd.
Furukawa Magnet Wire Co., Ltd.

Initiatives for the Environment

Environmental Management
The Furukawa Electric Group conducts its environmental protection activities to achieve the objectives set forth in its
2012 Medium-Term Plan for Environmental Preservation Activities, in accordance with the Basic Philosophy and Action
Guidelines of its Basic Environmental Policy.

Furukawa Electric Basic Environmental Policy
Basic Philosophy
We, the employees of the Furukawa Electric Group, recognize that preservation of the global environment is aserious issue confronting the international community, and we pledge to contribute to a sustainable future for theworld through technological innovation that utilizes our strength in advanced materials.

Action Guidelines
1. W
 e shall comply with environmental laws and regulations as well as the demands of our customers and others,setting ever higher environmental targets as we continuously improve our global environmental conservation
efforts.
2. W
 e shall strive to develop products that are friendly to the Earth, and create new environmental businesses.
3. W
 e shall strive to reduce environmental risk by incorporating anti-climate change and resource conservation/
recycling considerations, as well as a reduction in the use of environmental impact-causing substances, acrossthe entire product lifecycle.
4. W
 e shall evaluate the ecological impact of all of our businesses, and strive for the preservation of biodiversity andsustainable use of resources.
5. W
 e will seek harmony with the natural environment and local communities through dialogue with our stakeholders.

Environmental Management Promotion
Organization
Management Organization
The Furukawa Electric Group’s Central Committee forEnvironmental Management, headed by the chief social
responsibility officer (CSRO) and answering directly to thepresident, meets quarterly to formulate Group environmental
management targets and follow up on their status. To
reinforce Group environmental management, in April 2011
we inaugurated the Environmental Committee. Targeting
Environmental management promotion organization
PresidentGroup companies in Japan, this committee integrates thetwice-yearly Liaison Meeting for Consolidated Environmental
Management and the Committee for Consolidated
Environmental and Green Product Management. This
committee is working to promote environmental activities
throughout the Group in accordance with consistentenvironmental targets.
Fiscal 2013 will be the final year for the Furukawa ElectricGroup’s 2012 environmental protection targets. Therefore, inFebruary 2012 we set up the Working Group for Sustainability
Planning, a cross-company organization chaired by the
CSRO. The aim of this working group is to formulate amedium- to long-term environmental management plan.

Receiving Third-Party Verification

CSRO:Chairperson

Central Committee forEnvironmental Management
Committee for Reductionof GHG Emissions
Working Group for Reducing
GHG Emissions

Environment Committeeof Works

Committee for Development ofEnvironmentally Sound Products

Our seven manufacturing works and all domestic affiliates
participating in consolidated environmental management are
acquiring ISO 14001 certification. Our overseas affiliates arecollecting data and constructing management systems tothis end.

Working Group for
Sustainability Planning

Safety and Environment Promotion Department, CSR Division

Environmental Accounting

Environment
Committees
of companies andbusiness divisions

The Furukawa Electric Group conducts environmental
accounting in conformance with the environmental
accounting guidelines published by the Ministry of theEnvironment. The Furukawa Electric Group’s overall
environmental conservation costs in fiscal 2012 came to¥1.6 billion in investment and ¥6.1 billion in expenses.

Energy Conservation
Liaison Meeting forCommittee,
Domestic andWaste Committee,
Overseas Group
Chemical SubstanceAffiliates
Committee,
Other Expert Committees

Environmental Personnel Meeting
Transport Energy Reduction Committee
Committee for Green Product Management
Group Environmental Committee
Working Group for the Promotion ofEnvironmental Performance IndicesWEB

Environmental Accounting

http://www.furukawa.co.jp/english/csr/enviroment/accounts.htm

Furukawa Electric Group Sustainability Report 201218

Initiatives for the Environment

Environmental Education
The Furukawa Electric Group focuses on education and other activities to raise groupwide environmental awareness inaccordance with its Basic Environmental Policy.

Environmental Education System andEnvironmental Education Programs
The Furukawa Electric Group conducts various types ofenvironmental education to cultivate among employees theunderstanding that is necessary to conduct environmental
activities and raise their environmental consciousness.
In fiscal 2012, 45 employees attended our ISO 14001
Internal Environmental Auditor Course, 34 attended ourFGMS* Auditor Course, and 16 participated in our EMS
Upgrade Seminar.
* Furukawa branding Green products Management System

Environmental education programs
Category ofeducational
training

Content

Education for new
General environmental
recruits (once a
protection activities
year, mandatory)
EMS activities(as needed,
mandatory)

New
Generalrecruits employees

MidManagecareer
ment
employees

Training for
new recruits

Environmental Policy andpurpose, goals and generalknowledge pertaining to theenvironment

Requirements of ISO
ISO14001-related
standards, environmental
education (two-day
regulations, procedures forcourse) (twice ainternal environmental audits,
year, voluntary)
various drills
One-day brushup course (once a
year, mandatory)

Trends in environmental
regulations, various drills tobrush up auditing skills
Environmentallysound design

Environmental
Environmental regulations
subjects (asneeded, voluntary) Control of chemical
substances contained in
products
Consolidated
environmental
management
seminars

Seminars by experts onpriority issues

Environmental Awards System
To ramp up our environmental activities, in fiscal 2011 we
introduced an environmental awards system. There are three
award categories for Furukawa Electric on a standalone basis:
expanding sales of environmentally sound products, global
warming prevention activities, and group activities. Affiliatedcompanies are awarded for overall environmental activities.

Award for Efforts to Increase Sales ofEnvironmentally Sound Products
We provide the Award for Expanding Sales of Environmentally
Sound Products to further promote sales of environmentallysound products. Each company is ranked by number of19

Furukawa Electric Group Sustainability Report 2012

registrations and its percentage sales of environmentallysound products, with the top companies receiving awards.
In fiscal 2012, the Superior Excellence Award was given
to the Energy & Industrial Products Company.

Global Warming Prevention Activity Award
To promote activities at the business divisions to prevent
global warming, we have initiated the Global Warming
Prevention Activity Award. This award is given to divisions
that take superior initiative, and is tied to the improvement inmotivation.
There were 14 entries for this award in the current fiscal
year, six more than in the preceding year. In addition to three
initiatives in the preceding year, including the development
and commercialization of superior environmental
technologies and internal production process improvements
leading to reduced CO2 emissions, we received reports on
11 ongoing projects. These included such measures asproper operation of a compressor, updates to high-efficiency
lighting equipment, reducing standby power and thermal
insulation processing.
As a result of the judging, the Copper Foil Division won
the Superior Excellence Award for its process improvement
measures that contribute to the substantial reduction ofelectricity used in the manufacturing process. In addition, we
have granted two Excellence Awards and six Effort Awards.

Environmental Group Activity
Presentation Meetings
We began holding our Environmental Group Activity
Presentation Meetings in 2010 to promote a variety ofenvironmental activities. At this event, each recommendedgroup announces the content and results of environmental
activities. Committee members review outstanding activities,
with a focus on initiatives that are innovative and can be
deployed groupwide.
The second of these meetings was held at corporate
headquarters in September 2011, and presentations weremade by seven teams recommended by each Works.
Following strictly impartial judging by 10 committee
members, including the CSRO, the Hiratsuka Works’“Energy Conservation Activities
Related to MCPET Production”
was selected for the Superior
Excellence Award. Initiatives
by the Copper Tube Divisionand the Yokohama Works also Environmental Group Activity
Presentation Meeting
received Excellence Awards.

Initiatives for the Environment

Material Flow
The Furukawa Electric Group strives to reduce various kinds of environmental impact, resource use and energy
consumption in the course of conducting business.

Environmental Impact of the Furukawa Electric Group in Fiscal 2012
Data has been compiled for Furukawa Electric, its 28 affiliated companies in Japan and 44 affiliated companies overseas.

INPUT
Category

Domestic

OUTPUT
Overseas

Category

Unit

Furukawa ElectricRaw materials

Domestic Overseas

Unit

Waste

Copper155,258

164,397

tons

Seven works,

Total waste generated

64,73032,460 tons

Aluminum

280,542

40,681

tons

Final waste disposal

1,014

7,170 tons

Iron

4,515

10,826tons

28 domestic
affiliated companies

Recycling amount

59,70917,201 tons

Nickel

568

—

tons

and

Chromium

165

—

tons

Manganese

1,507

—

tons

44 overseas
affiliates

CO2819,835

393,108 tons-CO2

132— tonsAtmospheric emissions

Magnesium

4,943

—

tons

SOx

Other metals

40,700

—

tons

XOx

736

— tons

46

—

tons

Soot

35

— tonsVolume emitted

151— tonsVolume transferred304— tonsRubber
Glass

132

1,493

tons

Plastic

46,87846,999tons

Energy17,918

6,589

TJElectricity (purchased electricity)

1,076,320

526,321

MWh

Electricity (hydroelectric power)

147,835

22,840MWh

Wastewater

24,065

1,261 1,000 m3

Electricity (solar power)

15

—

MWh

Public waterways

22,855510 1,000 m3

21,298218 1,000 m3

Chemical substances

City gas

40,9444,319

1,000 m3

RiversLPG

40,118

2,325

tons

Sea

1,554

0 1,000 m3

Heavy fuel oil A

11,223

1,042

kl

Other

2,783

292 1,000 m3

Sewer

1,210

751 1,000 m3

Kerosene

14,5007

kl

Light oil

789

109

kl

BOD

69

— tonsWater

26,9382,148

1,000 m3

COD

71

— tonsIndustrial water

20,16574

1,000 m3

SS

53

— tonsGroundwater

5,575

327

1,000 m3

Tap water

1,198

1,747

1,000 m3

Product shipping volume924,927— tons57,329—Product collection volume

5,483— tonsType of cable

4,963— tonsPlastics

438— tons

Metals82— tons115,017659,871 tons

Chemical substances
Volume handled*1

tons

Packaging*2
Cardboard

900

—

tons

Wood

37,15674,405tons

Plastic

1,079

3,883

tons

Paper

601

557

tons

1,084

—

tons

Paper

*3

Volume of water
recycled and reused*1 PRTR-listed substances*2 Cardboard, wood, plastic, and paper used in product shipping*3 OA paper, copy paper, etc. used at plants and offices

Furukawa Electric Group Sustainability Report 201220

Initiatives for the Environment

Targets and Performance (Environment)
The Furukawa Electric Group is proceeding with environmental conservation activities against medium-term targets in its
2012 Medium-Term Plan for Environmental Preservation Activities and the annual plan based upon it.

Activity Targets and Performance in Fiscal 2012
The Furukawa Electric Group defines medium-term targets
every three years. (For fiscal 2012, these were in the form of
the 2012 Medium-Term Plan for Environmental Preservation
Activities.) Each year, we establish targets for environmental
protection activities based on these plans. In addition todeveloping these activities at all of the Furukawa ElectricWorks, we are also making progress in consolidating theoverall Group targets and activities by reflecting them in theenvironmental targets at each affiliate through the efforts ofActivities
Waste reduction activities

Activities to prevent
global warming

Chemical substancemanagement activities
Green activities
Eco-design activities
Biodiversity preservation

the Group Environmental Committee.
In fiscal 2012, we reached many of our targets in the
categories of reducing emission of gases that cause global
warming and lowering VOC emissions. However, we fell
short of our targets in a number of activities. In fiscal 2013,
we will redouble our efforts to do so from fiscal 2012 on,with the goal of fulfilling our 2012 Medium-Term Plan forEnvironmental Preservation Activities for the Group overall.

Performance in fiscal 2012
Furukawa Electric
RatingAffiliated companies

Rating

―18.8% reduction
11.8% reduction

○
―
○
○

89.2%
74%
20.5% reduction
12.6% reduction

×
×
○
○

Achieved at 7/21 Divisions

×

Achieved at 12/17 Works×13.8% reduction○

Achieved at 8/12 Works

×27.7% reduction

○

―

―

―

―

58.9% reduction○

Achieved at 6 companies○○

Environmental preservation activity targets for fiscal 2012
97% or more recycling rate (95% or more for affiliates)
Affiliates zero emissions achievement ratio: 80%
14% reduction in greenhouse gas emissions compared with fiscal 2001 level
4% reduction in energy consumption compared with fiscal 2008 level
1% reduction in specific energy consumption for manufacturing compared withthe previous fiscal year
5% reduction in specific energy consumption for transportation compared withfiscal 2007 level (1% reduction at affiliates compared to the previous fiscal year)
Furukawa Electric: 10% reduction in emissions of volatile organic compounds
compared with fiscal 2008 level*1
Affiliated companies: 42% reduction in emissions of volatile organic compounds
compared with fiscal 2005 level*2
Procurement rate for 52 general-purpose products: 100%
Expand to Group companies
Sales ratio for environmentally sound products: 25% or greater (Furukawa
Electric only)
Establish biodiversity impact guideline
Examine models for biodiversity action

97%

100%
○
Expanded to 15 Group companies
40.0%

○

―

Evaluation of risk and determination of issues with regard to biodiversity―△*1 Revised by adding hydrocarbon-based detergent (Subject: All VOCs)*2 As has been the case up to now, mainly two substances (toluene and xylene)

Fiscal 2013 Activity Targets
As fiscal 2013 will the last year for the 2012 MediumTerm Plan for Environmental Preservation Activities, we will
intensify groupwide efforts to achieve the plan’s final goals.
With regard to chemical substance management
Activities
Waste reduction
activities

Activities to prevent
global warming

Chemical substancemanagement activities

Recycling rate
Group zero emissions achievement ratio
Greenhouse gas emissions
Energy consumption
Specific energy consumption for
production
Specific energy consumption fortransportation
VOC emissions volume

Green activities

Eco-design activities

activities, we have revised affiliated companies’ targets for
reducing VOC emissions. As for Furukawa Electric on astandalone basis, their new management target is all VOCs.

Environmental preservation activity targets for fiscal 2013
99% or more (97% or more for affiliates)
Affiliates zero emissions achievement ratio: 90%
Reduce by 15% compared to fiscal 2001
Reduce by 5% compared to fiscal 2008
Reduce by 1% compared to the previous fiscal year
Reduce by 6% compared to fiscal 2007 (Furukawa Electric only)
Furukawa Electric: Reduce by 15% compared to fiscal 2008
Affiliated companies: Reduce by 1% compared to the previous fiscal year*1
Procurement rate for 52 general-purpose products: 100%
Expand to affiliates
Sales ratio for environmentally sound products: 45% or greater (Furukawa
Electric only)
Conduct of LCA for all important products:100%

Biodiversity preservation*1: Targets all surveyed VOCs

21

Furukawa Electric Group Sustainability Report 2012

Formulation of biodiversity guidelines and creation of structures2012 Medium-Term Plan forEnvironmental Preservation Activities
99% or more recycling rate
Affiliates zero emissions achievement ratio: 90%
Reduce by 15% compared to fiscal 2001
Reduce by 5% compared to fiscal 2008
Reduce by 1% compared to the previous fiscal
year
Reduce by 6% compared to fiscal 2007
(standalone only)
Optimal management of the quantity of chemical
substances consumed
Expansion of general purpose green products
Increase in the development and sale ofenvironmentally sound products
Improvement in product environmental
performance indices and increase in sales
Formulation of guidelines and establishments ofsystems

Initiatives for the Environment

Environmentally Sound Products
The Furukawa Electric Group certifies and registers low-environmental impact products as “environmentally soundproducts,” and promotes their use.

Environmentally Sound Products andthe e-Friendly Accreditation System

Environmental Performance Index(“Visualization”)

The Furukawa Electric Group certifies and registers asenvironmentally sound products those products withimproved performance compared to existing productsin the categories of materials and parts purchasing andmanufacture, use, distribution and disposal.
We have created the “e-Friendly” environmental mark to
identify such environmentallysound products. This markis placed on those products,
The e-Friendly markas well as in catalogs.

In order to create environmental performance indicators for
major product lines, the Furukawa Electric Group is using
life-cycle assessment (LCA) to “visualize” CO2 emissions.
In fiscal 2012, we performed LCAs on 22 additional
product lines and created Product Category Rules (PCR)
guidelines. This effort brought the total number of productlines up to 40, allowing us to use environmental performanceindicators for products accounting for approximately 50% of
total net sales.
In fiscal 2013, we will implement LCA evaluation targets
for all major production lines. We will use the results of ourcalculations to define numerical targets for our next mediumterm plan and employ them on research and development
on environmentally sound products.

Environmentally sound product categories
Category

Content

Prevention of global Products with functions that help in the reduction of emissions as well
warmingas the absorption and stabilizing of greenhouse gases
Products made from recycled materials, products designed with easyto-recycle components, products made from materials or with design
facilitating volume reduction for lowering waste volume, products
designed to share common components with other products or
products designed as common components.

Implementation of LCA evaluations on product lines
Energy and Industrial Products Company

45

Elimination ofmaterials that havean impact on
the environment

Products that do not lead to an increase in the use of ozone-depletive
substances during the manufacturing process, do not contain harmful
substances above regulatory limits and do not generate harmful
substances above these limits during use or disposal.

Telecommunication Company

911Electronics and Automotive Systems Company

4

3

Metals Company

1

3

Total

18

22

Resource savings

Products that result in overall energy savings by such means as reducing
the use of raw materials and components as well as scarce resources,
featuring enhanced longevity, allowing easier product and component
maintenance, and reducing the use for resources in packaging.

Zero emission

Company Business Division

Expanding Environmentally Sound
Products
We are working to increase our overall percentage ofenvironmentally sound products. We set targets based on
percentage of sales, and confirm our progress and successon this basis.
In fiscal 2012, on a standalone basis Furukawa Electricreached its target for environmentally sound products of
40.0% of total sales, surpassing its goal of 25% or more. (Thegroupwide result was 19.7%) For fiscal 2013, we have raised
this target to 45% or more, and we will continue with efforts
accordingly.

2011

2012

Examples of Degree of Social Contribution (NC-WS
Electrodeposited Copper Foil)

For one product on which LCA has been calculated, NCWS electrodeposited copper foil, we calculated the degreeof contribution to CO2 reduction if the product were actuallyused in the lithium-ion batteries of electric vehicles.
At Eco-Products 2011, we introduced the results of thesecalculations and the degree of social contribution made by
NC-WS.

Environmentally sound products as a percentage of sales
Cumulative number of registered items (non-consolidated)
Cumulative number of registered items (affiliated companies)
Percentage of sales on a single-year basis (non-consolidated)
Percentage of sales on a single-year basis (Group companies)(No. registered)

100

2mm

40.0

80
14.4

40
20
0

50

6.0
8

8

2009

44

12

2010

11.3

19.7

5mm

100

The use of Furukawa Electric’s
copper foil would result in an
estimated savings of 1.28 million
tons per year by 2020.

30
20

73

14

16

10

2011

2012

0

67

単年売上高比率
（単体）
（件）

1mm

40
20.9

60

累積登録件数（単体）(%)

Poster displayed at Eco-Products 2011
Furukawa Electric Group Sustainability Report 201222

Initiatives for the Environment

Environmentally Conscious Production/
Chemical Substance Management
The Furukawa Electric Group to enhance sustainability by reducing the environmental impact of production anddistribution processes and appropriately managing chemical substances.

Reducing Greenhouse Gas Emissions
Initiatives at Works
The majority of the Group’s greenhouse gas emissions
consist of CO2 generated from electricity, fuel and otherenergy sources. As emissions from manufacturing
processes account for a large proportion, we work on
reducing emissions by increasing the efficiency of production
processes, switching fuels, replacing equipment withmore efficient alternatives, insulating hot areas and othermeasures.
Total Group GHG emissions came to 820,000 tons of
CO2 in fiscal 2012, a reduction of 20.0% against fiscal 2001
levels, and energy consumption was down 12.3% comparedwith fiscal 2008 levels. On a non-consolidated basis, weachieved an equivalent of 244,000 tons of CO2, a reductionof 18.8% compared to fiscal 2001. CSR Data Book
Greenhouse gas emissions
Furukawa Electric

Affiliated companies(104 tons CO2)

120
90
60
30
0

72.5

70.6

69.6

66.9

65.7

61.6

60.0

57.6

30.0

28.7

28.2

27.1

26.5

25.9

24.6

24.4

2001

2006

2007

2008

2009

2010

2011

2012

enhancements in loading rates. In addition, Furukawa Electricachieved a reduction of 13.8% in specific consumption fromfiscal 2007. Despite such factors as a decrease in longdistance shipping and a downward trend in the modal shift
rate, we will continue to promote modal shifts, increased
loading rates, joint shipping and similar measures todecrease the energy used in shipping. CSR Data Book

Reducing Waste
The Furukawa Electric Group began taking action to reduce
outsourced waste disposal in fiscal 1994, and launchedzero emission efforts in fiscal 2002 for reducing the volume
of final disposal to less than 1% of the total volume of waste
by directly transporting waste from each works to final
disposal sites.
As a result of our efforts to meticulously sort waste
and recycle waste acid and sludge into useful resources,
the overall level of outsourced waste (which was notrecycled) disposal for the Group for fiscal 2012 fell by 66.1%
compared with fiscal 2005 to 5,021 tons. Also, the volume
of waste directly sent to landfills fell by 78.1% (to 1,014 tons)
in comparison to fiscal 2005 for Group companies in Japan,
disposal for Furukawa Electric alone was zero.
Non-recyclable waste volumes(FY)*1 The emissions coefficients of the respective power companies are used toconvert power use volumes.
*2 CO2 emissions attributable to hydroelectric power are deemed to be zero.

Furukawa Electric

15,00010,000Initiatives in Logistics

Affiliated companies(Tons)

10,9979,041

In fiscal 2012, total transportation volume for the Furukawa
Electric Group decreased 3.2% year-on-year to 460 million
ton-kilometers. Of this total, Furukawa Electric alone accounts
for 133 million ton-kilometers, down 1.0% compared withfiscal 2011. The Company decreased CO2 emissions
by 2.6% year-on-year to 14,900 tons, due largely to

Direct landfill disposal

Modal shift and specific consumption (Furukawa Electric)(Tons)

7,951

3,816
0

2005

2,119
2006

Furukawa Electric

Specific consumption

1.9

(%)

1.869
8.5

10.7

1.7
0

9.9

1.833

1.8

9.0

2009

4,903

4,272

1,552 1,839 1,160 1,252
863
749
2007
2008
2009
2010
2011
2012 (FY)

Affiliated companies

2010

4,000
3,000

8.0

6.6
1.698

3.6
2008

5,753

12.0

1.742

2007

7,824

5,000

Rate of modal shift(MJ/ton-kilometers)

1.897

8,573

5,000

2011

1.636

2012

4.0
(FY)

0

4,121
3,113

2,000
1,000

2,254

古河電工

関係会社

（万トン-CO504 2）

120
0 2005

176
2006

177
2007

2,124

1,818

271
2008

258
2009

1,619
164
2010

1,355
1,014
4
0
2011
2012 (FY)90

23

Furukawa Electric Group Sustainability Report 201260
30

72.5 67.6 70.4 73.3 75.6 70.6 69.6 66.9 65.7 61.6 60.0 57.6

Also, in fiscal 2012, the target waste recycling rate (theratio of recycled waste compared to total waste volume) was
95% or more for affiliated companies and 97% or more for
Furukawa Electric on a standalone basis. Furukawa Electric
met this objective, at 97.0%, but affiliated companies fell
below their target, reaching 89.2%. CSR Data Book

Green Activities
Response to Customer Requests
When the Group receives a request from a customer
for information concerning chemical substances in our
products, it conducts a thorough environmental examination.
We also monitor trends in laws and regulations covering thechemical substances contained in products and compile andupdate data as it becomes available, allowing us to respondpromptly to customer requests. Furthermore, by collecting
information from industrial organizations and conducting
seminars, as well as participating in research groups, we canmonitor environmental regulations and standards and social
issues/items of concern. This enables us to incorporate
customer needs in our environmental conservation targets.

Response to Overseas Regulations(REACH Regulations, RoHS Directive)

affiliated companies, in fiscal 2012 we designed items forconformance at 15 affiliated companies. We continue topurchase conforming items.
Also, purchases of items for use in our products are
made based on our Green Procurement Guidelines, withthe selection of appropriate items based on the FGMS
system at the supplier and confirmation of data on chemical
substances contained in the products. We continue to
implement Green Procurement in regard to our main
suppliers and products purchased, and henceforth aim to
expand it for application to all components.

Chemical Substance Management
Activities
The Group works to reduce emissions of harmful chemical
substances. In particular, we make every effort to actively
reduce emissions of volatile organic compounds, one causeof photochemical smog. CSR Data Book
Overall Group emissions (of toluene and xylene) in fiscal
2012 were down 58.3% compared to fiscal 2005.
Among Group companies in Japan, there remains
one that uses organic chlorine compounds, and we areconsidering the phasing out of their use at this company.

Substances of very high concern (SVHCs)* that are includedin the Candidate List under the REACH regulations are
updated twice each year. Each time additional SVHCs are
published, the Furukawa Electric Group researches thestatus of its use of such substances. As of the end of fiscal
2012, we had conducted checks on 73 substances.

Emissions of volatile organic compounds		
(Group total: toluene and xylene)* Substance of Very High Concern. Use or marketing of SVHCs requires
approval, and manufacturers are liable to submit notification if an SVHC
exceeds 0.1% weight content.

100(Tons)

300

241

237

206

200

0

Regular Auditing under the Furukawa Branding
Green Products Management System (FGMS)

261

2005

2006

2007

2008

138

122

127

2009

2010

2011

109

2012

(FY)

Appropriate Management of Chemical Substances

Our FGMS Regular Auditing in fiscal 2012 was conducted
through self-checking and auditing at a Works of Furukawa
Electric, four factories of affiliate companies, and two
factories of affiliates’ suppliers. To control chemical
substances contained in products, we will continue tomonitor environmental risks, and expand and implement
auditing according to degree of importance.

At the Furukawa Electric Group, we confirm the properties
and applicable laws and regulations regarding all chemical
substances we use during the manufacturing process ontheir Material Safety Data Sheets and administrate them.
We also monitor the usage volume of chemical
substances listed in the PRTR Law*. CSR Data Book

Expansion of Green Procurement (GeneralPurpose Products) to Group Companies

Reducing Emission of Volatile Organic Compounds

We encourage the purchasing of OA equipment, officesupplies and other items that conform to the Green
Purchasing Law. Extending these activities to include* Law Concerning Reporting, Etc. of Releases to the Environment of SpecificChemical Substances and Promoting Improvements in Their Management

We are voluntarily working to reduce emissions of VOCs. The
main targets are toluene, acetone and n-decane.
In fiscal 2012, we reduced emissions 27.7% against
fiscal 2008 levels, surpassing our target of a 10% reduction.

Furukawa Electric Group Sustainability Report 201224

Initiatives for the Environment

Environmental Risk Management
The Furukawa Electric Group recognizes the potential risks of environmental impact resulting from its business activities
and formulates countermeasures for each type of risk.

Preventing Soil and Groundwater
Pollution

Response to Asbestos Concerns

The Furukawa Electric Group engages in the management ofspecific toxic substances and conducts regular inspections
for leaks to prevent the pollution of soil and groundwater innearby communities. We reduce the risk of pollution throughmeasures to prevent leaks and through ongoing efforts toswitch to substitute substances.
In fiscal 2012, we continued proper disposal of the slag
stored in the Oyama area (a site of the former Furukawa
Magnesium Co., Ltd.). Soil remediation through excavation
and removal has been conducted at locations where siteexaminations have found contamination. We will confirm
our plans as we continue with this work. Also, groundwatermeasures conducted in the previous fiscal year wereongoing at the site of the former Ibaraki Factory of Aoyama
Kinsho Co., Ltd.

Although our company does not currently produce or importany products containing asbestos, some of the industrialuse products we made and sold in the past did containasbestos. These include electrical wiring for ships, and fireresistant products for constructing telecommunications andelectrical power facilities, etc. For details please visit our
homepage.
In addition, we are currently examining the buildings andplants of Furukawa Electric and our affiliates to determine
if asbestos-containing building materials have been used.
Inspections for asbestos dispersal in buildings in whichspray-on materials had been used have confirmed thepresence of asbestos, and removal work or containment
measures have been taken to prevent future dispersal. We
have also proceeded to replace equipment and fixtures inwhich asbestos insulation has been used so as to prevent
dispersal, with planned replacements of all items which are
currently not dispersing asbestos with items not containing
it. For other items, we conduct regular inspections andintroduce alternates during facility renewals.

Effort to Prevent Atmospheric andWastewater Pollution
At each of the Furukawa Electric Group’s works andthe business bases of affiliated companies, we maintainvoluntary control limits and manage operations to avoid
exceeding regulatory limits, such as those prescribed by the
Air Pollution Control Law and Water Pollution Control Law.
Atmospheric and wastewater quality data was all within
regulatory limits at each works in fiscal 2012.
WEB

Management status at works

http://www.furukawa.co.jp/english/csr/enviroment/risk.htm

PCB Management
The Furukawa Electric Group monitors the amount of
PCB-containing equipment at each of our Works andaffiliate company sites, and conducts proper storage andmanagement. Based on this information, we register with
the Japan Environmental Safety Corporation and entrust
waste processing in accordance with plans. In fiscal 2012,
processing of managed substances commenced at the
Mie Works and the Copper Tube Division. Also, condensers
and transformers removed from our facilities are examined
for PCB content on a case-by-case basis. We are also
proceeding with planned analyses of equipment containing
even small amounts of PCB, with all examinations slated forcompletion by fiscal 2013.
WEB

25

Number of instruments containing PCB

http://www.furukawa.co.jp/english/csr/enviroment/risk.htm

Furukawa Electric Group Sustainability Report 2012

WEB

Response to Asbestos Concerns (Details)

http://www.furukawa.co.jp/english/csr/enviroment/risk.htm

Environmental Accident Response
At the Furukawa Electric Group, we conduct annual checks
for conceivable, clear environmental impact so as to prevent
environmental accidents or prevent widespread impact in theevent of an accident. We also conduct simulation drills that
presuppose post-accident responses.
We regularly confirm environmental laws and otherregulations to determine items requiring compliance, and
we endeavor to comply accordingly. According to our fiscal
2012 survey on the status of our regulatory compliance, wewere not in material violation of any regulations.

Initiatives for the Environment

Biodiversity Preservation
Based on the three points of emphasis that the Furukawa Electric Group established in 2011, we conducted initiatives tominimize the impact of our business activities on biodiversity.

Three Important Biodiversity Effort
Categories
We established the following three important biodiversity
categories to specify Group biodiversity efforts, in recognitionof the fact that our business, products and services are theresult of biodiversity, and of our impact, whether positive or
negative, on eco-systems.

Biodiversity Preservation:			Three Important Categories
1. Assess the impact of business practices on eco-systems,
and work to minimize the negative impact and maximize
the positive.
2. Promote sustainable resource use in consideration of
biodiversity preservation through anti-climate change
measures, resource conservation, and resource re-use, as
well increasing efforts to reduce the use of environmental
impact-causing substances.
3. By raising the consciousness of each individual, we actively
promote biodiversity preservation in tandem with society.

Evaluating Relationships between Operations
and Biodiversity and Analyzing Risks
Between August 24 and November 11, 2011, the Furukawa
Electric Group worked extensively to determine all thebusiness risks related to biodiversity, and we began taking
part in a project to clarify outstanding issues. We recognizedthat to develop specific actions related to biodiversity
preservation, we first needed to determine the current
status. We outsourced the consulting on this project to a
Project Implementation Flow
Kick-off
meeting• Sharethe objectives of risk analysis
• Explainbasic information related to companies
and biodiversity

Hearings at
individual
divisionsand organize each division’s risks• Determine• Helpeach person in charge understand therelationship between their work and biodiversity

Internal
workshopshearing results• Share• Reconfirmrisks• Identify
major risks• Determine
the ideal state to reach by 2020

specialist in this field,
Response Ability,
Inc., which analyzed
and evaluated therelationships between
the Group’s overallbusinesses andbiodiversity.

Holding internal workshops as one aspect ofthe project

Project Outcomes
Through this project, we recognized the existence of
biodiversity-related risks at all stages of recycling Furukawa
Electric Group products. Based on this knowledge, we
ascertained seven management issues involving themanagement of individual risks that should lead to Furukawa
Electric’s increased competitiveness.
Environmental Management Issues and Action Plans
• Establish
long-term vision and long-term targets forenvironmental management
• Createan organizational structure to support long-term
environmental activities
Seven• Promoteenvironmentally conscious research andEnvironmental development
Issues• Shift
to sustainable energy• Formulate
guidelines (raw materials, land use, water, etc.)• Promotethe 3Rs (reduce, reuse and recycle)• Communicate
with multiple stakeholders

Action Plans• Createa long-term plan for sustainability• Incorporate
biodiversity into R&D policy• Takeaction in individual biodiversity-related themesthat will have a rapid effect• Establish
working group to create a long-term plan forsustainability• Formulate
the next medium-term plan and organize aworking group for individual themes

Of these, we identified the creation of a long-term vision
for environmental management as a priority. We gatheredpeople from related divisions to formulate a working
group (the Sustainability Plan Working Group) to create amedium- to long-term plan on environmental management.
To ensure a fit between this long-term vision and the next
medium-term plan, we will share information and encouragecommunication among all related teams.
From fiscal 2013, to make our biodiversity preservation
initiatives more concrete, we will draw up guidelines related
to land use, procurement and other items.

Furukawa Electric Group Sustainability Report 201226

Initiatives for Society
The Furukawa Electric Group values communication with all stakeholders throughout
its corporate operations.
28

Relations with Our Customers

30

Relations with Our Shareholders

31

Relations with Business Partners

32

Relations with Our Employees

37

Relations with Communities

Detailed data is provided in our CSR Data Book (PDF).

http://www.furukawa.co.jp/english/csr/report/index.htm

27

Furukawa Electric Group Sustainability Report 2012

Initiatives for Society

Relations with Our Customers
Furukawa Electric places the utmost emphasis on quality and aims to ensure customer satisfaction while endeavoring to
manufacture excellent products from the customer’s perspective.

Maintaining or Improving the Quality of
Products, Services and Operations
Quality Control Policy
At every stage of our operations, from research anddevelopment to manufacturing, sales, customer service andmanagement, in all sections and all hierarchies, we always
strive to adhere to a PDCA management cycle based on
actual facts, maintain and improve our products, customer
services and the quality of our operations and put ourmanagement policies into practice.

To promote quality control at every level throughout theCompany, Furukawa Electric has established the Central
Quality Control Committee, which reports directly to thepresident, as its topmost quality control body. Under thiscommittee’s direction, Divisional Quality Control Committees,
which have links to the heads of each division make every
effort to maintain or improve the quality of our products,
services and operations.

Status of Activities in Fiscal 2012
In fiscal 2012, we pursued activities in line with the quality
policy introduced in fiscal 2011, placing the utmost emphasis
on quality while endeavoring to manufacture excellent
products from the customer’s perspective. We moved
forward with the following efforts: 1. Visualize design as wellas manufacturing quality; 2. Work to prevent accidents anddefects through experience; and, 3. Conduct quality training
and personnel development programs.
One specific objective was to reduce the number ofcustomer complaints throughout the Company by 10% ormore compared with the preceding fiscal year. As a resultof our efforts in this regard, we lowered the number ofcomplaints by 37%, surpassing our goal. The current level is
92% lower than it was 10 years ago.
Similarly, in fiscal 2013 we will continue efforts in line withthis policy. Through repeated application of the PDCA cycle,
we will endeavor to provide products that satisfy customers.

QC Circle Activities
The Furukawa Electric Group forms its worksite employees
into circles, promoting “QC Circle Activities” targeting quality
improvement and personnel training. In principle, the content
of these activities is left to the discretion of members of eachcircle. However, to ensure that these activities are not merely
temporary, the Company follows up regularly on the statusof activities and comments on their results. This approachencourages the members of circles to raise the level of theiractivities.
Furthermore, each manufacturing works holds QC Circle
Meetings. Circles selected there are invited to participate in
the QC Circle Conference, which takes place annually. Thisconference enables employees to share and compete on
the quality of their activities and provides an opportunity toenhance awareness.
In fiscal 2012, the QC Circle Conference was heldat the Mie Works. Representatives of eight circles frommanufacturing works in Japan and four overseas circles
recommended by individual companies attended andreported on their activities. The circle from FISA, an affiliatedcompany in Brazil, won the silver award for its efforts,
confirming that QC Circle activities are moving steadily ahead
at our overseas locations.

Presentation by FISA-recommended circle

Customer complaints (Furukawa Electric)
(%)

100

Base rate

100

50

0

27

2002

2008

18

16

13

2009

2010

2011

8
2012

Commemorative photo of all participants at the close of the conference(FY)

Furukawa Electric Group Sustainability Report 201228

Initiatives for Society

Relations with Our Customers

Participation in an Experimental Offshore Wind Farm Project
Furukawa Electric is participating in an experimental offshore
floating wind farm project sponsored by the Ministry of
Economy, Trade and Industry.
Offshore wind farms are attracting attention aroundthe world as potential next-generation large-scale power
generation facilities. These facilities harness frequent andpowerful ocean winds to generate electricity, which is thensupplied to land via undersea cables. As they need not belocated on land, wind farms are gaining a following in Japan,
where space for on-land sites for generation facilities islimited. For demonstration experiments on this project, whichis scheduled to last through 2015, three wind turbines capableof generating several thousand kilowatts each, as well as
related equipment, are to be sited in the Pacific Ocean some
20 kilometers off the coast of Fukushima Prefecture.
Furukawa Electric is in charge of developing an ultrahighpressure riser cable* system to transmit the electricity thefacility generates. As the wind farm will be floating rather than
fixed to the ocean floor, it will be easy to site, but equipment
will be easily affected by wind and waves. The riser cablemust also cope with the facility’s rocking on the waves and the
motion of the seawater itself. For these reasons, in addition
to being optimized to meet sea movement and flotation
requirements, the cable must have the same useful life as theturbines themselves, and must have the durability to withstandrepeated fatigue. Furthermore, the system itself must be
raising the voltage in order to transmit massive amounts ofelectricity over a long distance. An optical communication
system is therefore ideal. To overcome these hurdles, we plan
to employ the deepwater design simulation, broad-ranging
material and undersea cable technologies we have cultivated,and optical communication technologies, which meetrequirements for both reliability and cost.
* A permanently suspended submarine cable for connecting to a floating
structure. On an offshore wind farm, this cable connects the wind turbineswith transmission cables on the ocean floor.

Conceptual illustration

High-durability riser cable se behavioral analysis technology toUdevelop a riser cable optimally suited to theocean region and facilities

Riser cable connectors

 evelop connecting and subsidiaryDmaterials that can withstand large
movements in the riser cable

Optical communication system evelop an optical communication systemDsuitable for large-scale wind farms that is
economical and highly reliable

Shanghai, China Technology Fair
To accelerate its development of overseas markets, centering
on emerging countries, the Furukawa Electric Group takes aproactive stance on groupwide overseas marketing and efforts
to expand trading areas. As part of this move, each year since2009 we have held a joint Group technology fair in East Asia topromote our technologies and products.
During fiscal 2012, we held the final exhibition in thisseries, the FURUKAWA Innovation Expo 2011 in Shanghai,on July 22, 2011, at the Shanghai World Financial Center, amultistory high-rise that has become a landmark of the city.
A total of 29 Group companies, including Furukawa Electricand 17 companies based in China, attended the expo.
Themed on the environment, the fair featured 85 products andtechnologies divided into four categories: Smart Grid (energy/
construction), electronics, communications and transportation.
The Company’s president, CMO and CTO also conductedpresentations that covered management strategy and othertopics, and seven technology seminars were held to introduce

29

Furukawa Electric Group Sustainability Report 2012

recent technology trends. Through these presentations
and seminars, we described the Furukawa Electric Group’s
products and technologies and global development strategies,
and communicated our vision for the future. In July 2012,
we hosted another technology fair in Jakarta, Indonesia,
which is attracting attention due to increasing investmentby the infrastructure and automotive industries. In addition
to introducing products and technologies, we explained ourefforts to contribute to industrial development in ASEAN
countries.
Going forward,
we intend to further
expand our businessin various regions,
including Brazil,
India, Europe andthe United States.
Technology Fair in Shanghai

Initiatives for Society

Relations with Our Shareholders
Furukawa Electric’s investor relations (IR) focus is on mutual communications with shareholders and investors aimed at
improving our enterprise value.

Relations with Individual Investors

Information Disclosure Policy and IR
Framework
The Furukawa Electric Group Basic Policy on CSR requiresthat the Group seeks to improve upon the sound, friendly
relationships we maintain with all of our stakeholders. Our
Own Regulations on the Timely Disclosure of Corporate
Information meanwhile set out a framework for the disclosureof appropriate information at the appropriate time.
Based on this policy, all IR activities are overseen by
the Chief Financial Officer (CFO) and are managed by theInvestor & Public Relations Unit of the Corporate Strategy
Planning Department.
Trends in shareholder distribution(%)

March 31, 2011

March 31, 2012

Individuals

30.0

33.1
38.3

Financial institutions

42.1

Domestic companies

7.2

7.3

Overseas companies

18.0

18.6

Securities firms, etc.

2.7

2.8

In October 2011, we held our fourth plant tour for individual
investors.
Visitors were selected by lottery from among those who
responded to an open invitation, with 189 people invited toattend out of the 1,935 who responded. During the tour,
we offered participants a number of opportunities to get afeel for Furukawa Electric. We introduced our production
processes for optical fibers, copper products and automotive
parts, and visited a hydroelectric power station. The tour
also featured a simple explanation on the phenomenon ofsuperconductivity.
At the opening of this tour, we apologized for and offeredan explanation about the cartel issue. Participants indicatedtheir emotional attachment to Furukawa Electric, but also
said that they wanted us concentrate more heavily oncompliance.

Note: As of March 31, 2012, individual shareholders numbered 69,476 (up1,691 from a year earlier) and held 33.1 % of the Company’s shares.
Note: As of March 31, 2012, foreign shareholders held 18.6% of theCompany’s shares.

Relations with Institutional Investors
and Securities Analysts
In addition to holding management briefings (covering interim
and year-end results and mid-term plans when announced)
for institutional
investors andsecurities analysts,
we actively encouragecommunication all
year round.
Briefing for institutional investors

Nikko Works: Experiment to explain
the phenomenon of superconductivity

Mie Works : A close-up look at
just-produced 1100°C copper rod

Returning Profits to Shareholders
The basic policy of the Company is to pay stable dividends
and, at the same time, distribute profits to shareholders
commensurate to its future business operations, with an eye
on future income trends from a long-term perspective.
For the fiscal year ended March 31, 2012, we paid aninterim dividend of ¥2.5 per share. However, the Company
decided to forego the year-end dividend, owing to a
substantial decline in consolidated operating income, as wellas the posting of a significant net loss.

Main IR activities in fiscal 2012 (Furukawa Electric)
April–JuneMay
Term-end results announcement
June
Visits from European investors
June
General Shareholders’ Meeting
June
Shareholders’ Report issued

July–September

AugustFirst quarter earnings announced

October–December
October
Plant tours for individual investors
November
Second quarter earnings announced
NovemberMeetings in Singapore and Hong Kong
November
Forum for investors in Japan

January–March

February
Third quarter earnings announced

Furukawa Electric Group Sustainability Report 201230

Initiatives for Society

Relations with Business Partners
Furukawa Electric’s Group purchasing policy calls for stable and continuous purchasing on optimum terms. Therefore,
we focus on establishing and maintaining relationships of trust with our business partners.

Optimum Purchasing on a Steady,Ongoing Basis
Furukawa Electric’s Group purchasing policy is toestablish strategic relationships with business partners toensure optimum purchasing on a steady, ongoing basis.
Based on this policy, Furukawa Electric strives to create
cooperative relationships based on mutual trust with its
business partners, thereby contributing to sustainable future
development.

Furukawa Electric Group Procurement Policy
We will optimize our procurement through global partnering by:
1. Establishing strategic business relations with trading
partners to create a stable and sustainable procurement
function;
2. Establishing a system to facilitate centralized negotiations
to promote group procurement activities from multiple
locations;
3. Enforcing compliance and contributing to society;4. Securing stable and sustainable procurement of raw
materials and parts for our key products;
5. Achieving medium-term goals through continuous cost
reduction programs;
6. Expanding procurement from optimal locations;
7. Adopting procurement methods that match optimal leadtimes.

Conducting Training on Subcontracting
Transactions
In order to forge sound relationships with business partners
through fair transactions that comply with rules andregulations, the Furukawa Electric Group provides training
for employees on subcontracting transactions.
In fiscal 2012, in addition to continuing with the courses
we have conducted to date, we introduced a new e-learning
program. This program is aimed at ensuring thoroughawareness of the content of the Act against Delay inPayment of Subcontract Proceeds, Etc., to Subcontractors(Subcontract Law).

Partner Meetings and Partner
Evaluation Scheme
The Company seeks to deepen awareness among ourbusiness partners through regularly held Partner Meetings,
where we explain the state of the Company, our purchasing
policy and individual company management strategies.
For fiscal 2012, this meeting was held in August and was

31

Furukawa Electric Group Sustainability Report 2012attended by 95 key business partners.
We also evaluate key business partners on the basis ofquality, technology, price, delivery system, degree of social
contribution and financial condition, and then hold meetings
to provide feedback on our findings. We discuss the resultsof our evaluations withthem to more closelyalign our awareness of
procurement activities.
In fiscal 2012, weevaluated some 330
business partners andprovided feedback toPartner Meetingthem.

Promoting CSR through Procurement
Activities
Based on the CSR Deployment Guideline for Business
Partners that we formulated in fiscal 2011, we take part ininitiatives to ensure that our procurement activities involve
thoroughly compliant and fair transactions and take into
account human rights and safety, and consideration for theenvironment.
In fiscal 2012, we prepared an English-languagetranslation of our new CSR Deployment Guideline for
Business Partners. Using this translation, we aim to instill
compliance awareness in our overseas business partners
going forward, promoting CSR procurement activities
throughout the supply chain.
We will respond to growing societal requests not tomake use of resources procured from mines that neglect
human rights and environmental considerations (so-called“dirty mining”). This effort is designed to encourage ongoing
efforts on the part of our business partners.
WEB

CSR Deployment Guideline for Business Partners

http://www.furukawa.co.jp/sizai/english/guide.htm

Conflict Minerals*
In response to final disclosure regulations set forth in the
U.S. SEC’s Dodd-Frank Wall Street Reform and Consumer
Protection Act of 2010, we will ask for the cooperation of ourbusiness partners in confirming the country of origin of themine resources they provide and in not using minerals fromproscribed locations.
* Defined as minerals (tantalum, tin, gold, tungsten or their derivatives) thatoriginate in or near the Democratic Republic of the Congo that may help tofinance armed conflict.

Initiatives for Society

Relations with Our Employees
Furukawa Electric focuses on human resources skill development in our drive toward globalization. We also arebuilding workplace environments where diversity can flourish.

Personnel Management Policy

Human Resources Development

Our basic personnel management policy focuses oncontinuously creating human resources who are capable ofputting the Five Principles of the Furukawa Electric Group
Credo into practice on their own initiative.

Enhancing Training and Educational Programs

THE FURUKAWA ELECTRIC GROUP CREDO
1. Maintain high ethical standards, and value honesty andintegrity above all.
2. Continually improve, innovate, and lead, in every area ofendeavor.
3. Take a hands-on approach that addresses the reality of
every situation—in the office, at the factory, and on site.
4. Be proactive—take the initiative and work with others,
persevering until a solution is found.
5. Maintain open channels of communication between
departments and divisions, so that we can share ideals
and help each other grow.

In other words, we believe that a workplace environmentthat encourages among all employees compliance andconsideration for human rights serves as the foundation
upon which employees can maximize their capabilities.
On this basis, we are devising and introducing a personnel
system that will harness employees’ diverse abilities andpersonalities. This should encourage employee creativity,
setting the cornerstone for “continuous technologicalinnovation.”
Under New Frontier 2012, our mid-term management
plan that went into place in fiscal 2011, we are cultivating a
powerful workforce that will enable us to emerge victorious
amid stringent global competition. We are raising this asa constructive mission for building collaborative ties withaffiliates in Japan and overseas, and are augmenting current
measures and putting new ones in place accordingly.
As part of this initiative, we identify personnel who webelieve will contribute to the development of our businessthrough their advanced specialties, regardless of position. In
fiscal 2012, we introduced a Professional System to provide
better support to these people. The system, which aims tocultivate people who are skilled at bringing about reforms,
clearly identifies specialists in individual domains and seeks
to put them in positions and offer training according aprearranged schedule that will prove helpful in achieving
these objectives. As of April 2012, we had assigned 20
professionals under this program.

We provide various opportunities that encourage employees
who wish to do so to develop their skills through training,
remote learning and by obtaining qualifications. Since fiscal
2009, we have concentrated in particular on fostering
facilitation skills, which are needed to maximize andinvigorate organizational capabilities.
We use multifaceted evaluations when training
managers, helping to foster a sense of collaboration that will
enable them to manage organizations efficiently. Employees
who are about to be promoted to manager are encouraged
to take the initiative to create group discussions in which
they approach a situation logically, find out for themselves
what the issues are, and talk over solutions. We also have inplace an OJT Leader System targeting mid-level managers
to enable them to teach younger people. In addition togroup training, participants in this program share information
about leadership issues and work together to resolve them,encouraging their awareness of responsibility.

Training Leaders Suited for the Global Environment
We launched the Global Business Leader Training Program in
fiscal 2007 for the training of future management personnel.
More than 100 graduates of this program are currently atimportant posts in Furukawa Electric and at our affiliates inJapan and overseas.
At the same time, we began leadership training in Japanfor overseas management personnel. Called the Global
Development Program, the training deepens understandingof the Group, and helps managers polish their cultural
skills and leadership abilities through active discourse with
Furukawa Electric’s Japanese personnel. The goal of the
program is to develop personnel who can thrive in the global
environment.

Group deliberation as part of the global development program

Furukawa Electric Group Sustainability Report 201232

Initiatives for Society

Relations with Our Employees

Worksite Innovation Project
Since fiscal 2009, Furukawa Electric has been pursuing
initiatives to bolster the manufacturing capabilities of its
production sites. These activities focus on cultivating
gembaryoku (worksite capabilities) by encouraging people atits production sites to think for themselves and act on theirown initiative for the good of the customer.
We established the Furukawa Electric Group
Gembaryoku Enhancement Training Center at the Yokohama
Works in September 2010 for a variety of group training
programs. Specifically for new recruits, we conduct
programs for both technical and business employees. These
include the Joy of Manufacturing, which provides onsite
experience, and Craftsmanship Training, which fosters
recognition of the dangers of the production site.
In fiscal 2012, we set rank-specific goals for employees
at production sites and commenced a Basic Program aimed
at raising skill levels for all these employees. We put up
posters and distributed “gembaryoku” badges to employees
undergoing training, encouraging them to put into practicethe things that they had learned.
At each manufacturing works, we also conduct Chief
Operator Training, as well as training for mid-level operatorsand younger staff. This training helps to transmit coreknowledge at production sites, raise worksite awarenessand encourage people to pass on technologies and skills.
By providing an opportunity for headquarters and Group
company employees to interact without regard to affiliation,these efforts support the sharing of expertise.

Badges with the “gembaryoku”
logo distributed to trainees

Diversity
Diversity in Hiring
We are actively recruiting non-Japanese personnel andinternational students to support the globalization of ourbusiness. We also host students on internships fromoverseas universities.
We have a number of initiatives underway to recruit
talented personnel. In addition to information exchanges toshare know-how on hiring within the Group, we hold the
Furukawa Electric Group
Forum, at which we conduct
briefings in conjunction withGroup affiliates, and work
proactively to demonstrate
to students the Furukawa
Electric Group’s appeal.

Explaining the content of our businessto international students

CSR Data Book

Hiring the Disabled
Furukawa Electric established Furukawa Newleaf Co., Ltd.
as a special subsidiary in 2004 to actively employ people
with learning disabilities. This is one of our efforts to increase
the percentage of people with disabilities that we employ.
The company handles cleaning operations at thecompounds of our works and currently employs a total of 32
people with disabilities, 11 at the Hiratsuka Works and 21 at
the Chiba Works. The company also provides individualized
guidance on everything from matters of daily conduct in thecompany through the building of good human relationships,
to assist people with learning disabilities in becoming
independent members of society.
We also invite
caregivers with children
with no work experience totour our work and guidancesites, so as to better
understand our efforts
involving the employment
Furukawa Newleaf Co., Ltd., employees
in actionof people with disabilities.
Ratio of employees with disabilities (Furukawa Electric)
(%)

2.00

1.80

1.86

1.85

2009

2010

1.91

1.95

2011

2012

1.54
Basic Program training underway(lecture by experienced officer)

1.50
1.00
0

33

Furukawa Electric Group Sustainability Report 2012

2007

2008

(FY)

Although our employment ratio of people withdisabilities was 1.95% in fiscal 2012, exceeding the statutory
target, we intend to work on further expanding this group of
employees, primarily through our special subsidiary.

Upgrading and Enhancing Workplace
Environments
Introduction of a Volunteer Leave System
To support individual employees’ efforts to participate insocial contribution activities, we have introduced a Volunteer
Leave system for people who have been employed for one
year or more. We set the number of annual leave days that
employees can take under this system at five, encouraging
people to take advantage of this system to volunteer insupport of restoration and reconstruction activities following
the Great East Japan Earthquake. The system went into
place on July 16, 2011.

My Volunteer Activity Report
I participated in volunteer activities
to support reconstruction in the cities
of Rikuzentakata and Ofunato, in
Iwate Prefecture.

Going forward, we plan to enhance the Volunteer
Leave system to support more employee participation inenvironmental contribution activities and increase the use of
the Volunteer Leave program. CSR Data Book

Human Rights Awareness
The Furukawa Electric Group CSR Code of Conduct
stipulates that we work to respect human rights, prohibiting
discriminatory treatment and human rights infringement aswell as prohibiting harassment. We have also established aconsultation desk concerning human rights concerns thatcan be accessed from within or outside the company, andconsultations by employees are promptly responded tojointly by the HR & Administration Department and the CSR
Division in the event that issues are reported. As of the endof fiscal 2012 there had been no cases of involving humanrights concerns within Furukawa Electric.
Furthermore, from the perspective of prevention, we
have in place a training curriculum that covers employees
from new recruits to top executives, including executives andmanagers at affiliated companies. The curriculum centerson raising awareness, covering such matters as prohibitionof discrimination against female employees, promoting
employment of seniors and people with disabilities, andimproved understanding of Japanese social integration
issues.

Koji Ohta

Ecology & Electronics Laboratories

I took part in volunteer activities to support
reconstruction of the area affected by the Great East
Japan Earthquake for a one-week period starting
September 18. Sleeping in the classroom of a closed
elementary school, we worked from early morning untillate in the evening at picking up rubble strewn acrossfields. The amount of rubble seemed never to decrease;
there is still much work to be done in the stricken region,
and more help is needed.
To participate in this project, I took part in the newly
introduced Volunteer Leavesystem, which makes it
easy to take time off work.
Social contribution is thegoal, which encourages
cooperation from theworkplace.
I hope that more people
will take advantage of thisopportunity to volunteer
for reconstruction support
activities. This is anexperience that is sure to
Work underway in the city ofremain with you.
Ofunato.

Improving the Working Environment throughLabor-Management Opinion Exchanges
Furukawa Electric maintains a basic position that both laborand management should endeavor to engage in sincere
discussions, and therefore we focus on issue resolution anddeepening mutual understanding.
We hold our Central Management Briefings twice
annually for public exchanges of opinion between laborand management. We have conduced such meetingsfor 60 years, since 1952. As of May 2012 we had held
these briefings 119 times. Representatives from labor andmanagement exchange frank opinions and share information
about a broad spectrum of items at these briefings, suchas the business environment, management, and topicalmatters.
We also have in place various committees such as
the Personnel System Exploratory Committee and theCommittee for Studying Shorter Hours that are designed
to improve the working environment, which management
and labor discuss on a daily basis. These discussions
lead to improvements in various systems and strengthen
monitoring functions, such as compliance response and theimplementation status of other CSR activities.

Furukawa Electric Group Sustainability Report 201234

Initiatives for Society

Relations with Our Employees

Occupational Health and Safety
The Furukawa Electric Group health and safety efforts take
into consideration our social responsibility to maintain ahealthy, safe and comfortable working environment.
The Central Health and Safety Committee chaired by theCompany’s Chief Social Responsibility Officer, formulates
our companywide Health and Safety Management
Guidelines and monitors and issues guidance to our worksites concerning their efforts. We also conduct Safety
Management Liaison Meetings throughout the Group forthe sharing of examples of disaster preparedness andinformation about activities.
Furukawa Electric is also constructing labor safety andhealth management systems at each of its works. In addition
to having received certification for our Chiba, Hiratsuka and
Mie works, in fiscal 2012 the Nikko Works also obtained
management system certification* from the Japan Industrial
Safety & Health Association (JISHA). In fiscal 2013, we aim
to receive certification for our Copper Tube Division.
We also hold Group Activity Presentation Meetings
covering our safety activities, and we give awards toexcellent teams. Each year, we hold meetings at each of ourworks, and groups chosen at those meetings participate
in a companywide conference. In fiscal 2012, 13 teams
were selected fromamong the Worksfor presentations at
the Companywide
Presentation Meeting.
* Organizations covered by
the Occupational Safety
Health Management System
are certified as meeting
JISHA standards.

Furukawa Electric has placed “Anzen Dojos” (safety
education centers) at all manufacturing sites to enable
employees to get a sense of the dangers. These centers
are designed as educational facilities where employees
can experience various dangers, such as heavy items,
edged tools, work in high places, revolving equipment andelectricity, to raise their sensitivity to danger.

Reciprocal Patrols
Each month, patrols are conducted at our manufacturing
works to confirm their safety. In addition, once eachyear a person in charge of health and safety at anothermanufacturing works performs a factory check, conducting
inspections from a different point of view to confirm that no
dangers have been overlooked. These checks also serve
as good case studies, providing opportunities for people incharge of health and safety to exchange information. They
also serve to improve the level of safety and health activities
on the part of people conducting the checks and thoseundergoing them.

Labor Accidents
In 2011 (January to December 2011), the frequency of
accidents resulting in absence from work was 0.49 for
Furukawa Electric on a standalone basis and 0.72 for theentire Group.
Frequency of accidents resulting in the suspension ofoperations
Furukawa Electric

2.00

1.77

1.78

Groupwide

1.85

1.95

Manufacturing

1.90

1.83

Companywide conference

Forklift Truck Safety Skills Competition
Forklift accidents are the cause of many serious injuries,
and are often caused by insufficient skills on the part of theoperator. Therefore, we hold our Forklift Truck Safety Skills
Competition, so as to improve awareness and operator
skills. There were 23 entrants from companies affiliated with
our Works and from other associated companies in our fiscal
2012 competition.
Furthermore, even
operators not taking
part in the competition
train on the competition
courses within theWorks.
The forklift truck safety skills competition

35

Educating Employees at “Anzen Dojos”

Furukawa Electric Group Sustainability Report 2012

All sectors

1.75
1.62

1.61

1.62

0.99

0.98

1.05

0.63

0.58

1.50
0.98

0.98

0.99

1.01

1.02

1.00

0.50

0.74
0.54

0.47
0.30

0

1.09

1.12
0.65

0.72

0.52

0.49
0.27

0.25

0.57
0.37
0.14

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Note 1: Frequency = (Accidents resulting in injury or death / total working
hours) × 1 million
2: Within the graph, figures for “manufacturing” and “all sectors” aretaken from the “Fiscal 2011 Survey on Industrial Accidents,”
conducted by the Ministry of Health, Labour and Welfare.

(FY)Healthcare for Employees Working Long Hours
In accordance with the Guideline issued by the Labor
Standards Bureau entitled “Measures to be Taken by
Employers to Prevent Health Impairment Due to Overwork,”
we are focusing on managing the health of employees
who work long hours by implementing strict limitations
on worktime based on health checkups and arranging
consultations by such workers with industrial physicians.

2012 within the company overall. As we eventually plan
to go to an entirely smoke-free workplace, we are taking
a multifaceted approach with three main thrusts: sharing
information, supporting efforts to quit smoking and creating
a smoke-free environment).
Smoking rates among Furukawa Electric employees (men)(%)

60

Mental Health Education
Our companywide mental health measures have been inplace since fiscal 2002, and are based on the Guidelines for
Promoting Mental Healthcare in the Workplace issued by the
Ministry of Health, Labor and Welfare.
We invite industrial physicians and nurses to take partas lecturers in education and training programs targeting
managerial and general employees. In the past, such training
has focused on stress control for employees aged 30–35,
as well as approaching mental health in terms of “workengagement*.”
In fiscal 2012, we also held Pleasant Workplace
Discussion Groups for workplace environment improvement
throughout the Company.
* A mental health concept pertaining to motivation, devotion, and energy
regarding work.

Strengthening Smoking Measuresn accordance with the Labor Standards Bureau DirectorGeneral’s 2003 directive entitled “Guidelines on Smoking
in the Workplace”, as well as the “Anti-Passive Smoking
Measures” issued by the Ministry of Health, Labor andWelfare in February 2010, we have been developing
companywide programs to prevent exposure to passive
smoke and encourage quitting smoking. As a result ofsuch activities, the percentage of smokers among male
employees fell from 53.3% in fiscal 2003 to 33.7% by fiscal

53.3

52.7

48.3

45.7

44.5

42.9

40.6

40

42.0

38.9

33.7

20

0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

(FY)

Responding to Asbestos-Related Health Issues
During the period from fiscal 2005 to 2006, we once again
investigated workplaces that previously handled asbestos
products and we organized medical examinations focusedon asbestos for all relevant employees. We also sent out
notices urging retired employees who worked at the relevantsites to undergo medical examinations.
As of March 31, 2012, symptoms have been detected
in one current employee and 10 retired employees. Also,a retired employee who had worked laying undergroundcables died from mesothelioma, and one died from lungcancer. These were confirmed to be industrial accidents.
We are continuing to deal with this by notifying retired
employees who worked at the relevant site regarding
changes to the requirements for issuing health cards inthe wake of revisions to Occupational Health and Safety
Regulations in April 2009.

Yokohama Works Receives Incentive Award from the Minister of Health, Labour and Welfare
In October 2011, Furukawa Electric’s Yokohama Works received
an incentive award, the fiscal 2012 “Awards from the Minister
for Health, Labour and Welfare for excellent workplaces,
organizations and persons who have contributed related tooccupational safety and health.” This same manufacturing works
received the Kanagawa Prefectural Labor Director Award in 2011.
The current award was in recognition of the works’proactive efforts to prevent damage to health as a result of
long working hours and to improve mental health, measures
to prevent health damage through chemical substancemanagement, and a focus on monitoring the working

environments in areas that are a potential health hazard(hazardous work). The works was evaluated as having “superior
health assurance measures.”Award (left) and letter of commendation (right)

Furukawa Electric Group Sustainability Report 201236

Initiatives for Society

Relations with Communities
The Furukawa Electric Group engages in social contribution from the perspectives of nurturing future generations,promoting sport and culture, and living in harmony with the natural environment and local communities.

Furukawa Electric Group Basic Policy on Social Contribution Activities
The Furukawa Electric Group will continuously undertake social contribution activities focusing on nurturing future
generations, promoting sport and culture, and living in harmony with the natural environment and local communities,
in addition to its business-related activities, in order to maintain and strengthen community ties built over centuries
and create a better tomorrow for future generations.

CSR Awards

Social Contribution Award

Furukawa Electric established the CSR Awards in fiscal
2010 to recognize the social contribution or environmental
preservation efforts of our subsidiaries that notably exceed
their regular business. In fiscal 2012, the third time for theseawards, we focused on activities rooted in local communities
and regions. Two companies received social contributionawards and one an environmental preservation award.

Furukawa Metal (Thailand) Public Co., Ltd. (FMT)The Kingdom of Thailand

Social Contribution Award

P.T. Tembaga Mulia Semanan (TMS)
The Republic of Indonesia
TMS’s approach is to make small but ongoing social
contributions, and the company has provided support to thepoor in Indonesia in this way since around 1980. Using thecompany’s own funds, as well as employee contributions,
TMS provides funding and food aid, and distributes schoolsupplies for single-mother households and orphans.

Since 2004, FMT has participated in Thailand’s “To Be
Number One” anti-drug campaign, of which Princess
Ubolratana Rajakanya is project leader. The campaign uses
three strategies for its committee, funding and activities:
to campaign for awareness, to provide mental healthimmunization to youth in communities and to develop
lifestyles and networks for prevention and assistance. In
cooperation with local government institutions, as well as
local residents, schools, training facilities and companies,
FMT is taking an active part in raising awareness both within
and outside the company through music and sporting
activities. In recognition of the style and content of these
activities, FMT took part in a nationwide competitioncommemorating 10 years of To Be Number One campaign
activities. FMT’s
team was selected
to represent central
and eastern Thailand.
The competition isscheduled to takeplace over the threeof the activity secretariat selected
day period from July 13 Members
to represent central and eastern Thailand in
the nationwide competition
through 15, 2012.

Child receiving aid to purchase school supplies

Environmental Preservation Award

Furukawa Industrial S.A. Produtos Eletricos (FISA)
Federative Republic of Brazil

Support for widows

37

Furukawa Electric Group Sustainability Report 2012FISA has, on its own initiative, organized the industry’s first
LAN cable collection and recycling program, which covers
the entire country of Brazil. This “Green IT” initiative targets
the collection of used and discarded LAN cable to prevent
it from being incinerated, leading to environmental pollution,with the aim of lowering CO2 emissions. Under this program,participating companies are presented with environmentallyfriendly RoHS-compliant LAN cables in accordance with theamounts FISA collect. The plastic from the recovered LAN

cables is processed at FISA’s plant, and copper wiring issent to copper processing companies for recycling. Some
336 companies have taken part in this project since it got
underway in 2008, collecting a total of 226,483 kg of LAN
cable (as of June 30, 2012).

Donating Disaster Stockpile Food Nearing its BestBy Date (Head Office, Furukawa Electric)
The Furukawa Electric head office maintains a stockpileof food against the eventuality of a Tokyo Metropolitan
Earthquake. In February 2012, we recognized that some
1,800 cans of bread (75 boxes of 24 cans each) in its
stockpile were nearing the end of their March best-by date,
and that we therefore needed to bring in fresher food. Rather
than disposing of still-edible food,the Company decided to distribute
Manufacturing
All sectors
it toFurukawa
thoseElectricin need.Groupwide
We donated1.95 1.90
the food to Second
1.85 Harvest
1.83
2.00
1.77 1.78
1.75
Japan*, delivering it to their office1.62 1.61 1.62
in Asakusabashi on February 29.

Trend in amount of LAN cable collected
Collected cable (second half)

Collected cable (first half)(kg)

80,00069,47935,10960,00029,75240,00020,000011,093

5,338
3,427
2009

34,98027,335

9,970
2010

2011

2012

2013

(FY)

Environmental Contribution Activity
Case Study
Clearing Mountain Pathways (Nikko, Furukawa
Electric)
The Furukawa Nikko mountaineering club of the Furukawa
Electric Nikko Works has a history reaching back 80 years
to the time of the works’ establishment. The club is a core
member of a mountain region federation involving Tochigi
Prefecture and the city of Nikko. Each year, the club cares forthe mountain pathways to prevent mishaps and mountainclimbing accidents. On June 23, 2012, these activities
covered the Mt. Taro region of Okunikko. The club sets up
public notice signboards, upgrades walkways and clears
away brush and roots from mountain pathways with themountain federation members. To promote safe mountainclimbing, the works plans to continue taking part in thisinitiative going forward.

1.50* This NPO gathers still-edible food that has
been disposed of for various reasons anddistributes it to the needy, 1.01
as well1.02
as 1.09
0.98 0.98 0.99
providing it free of charge to welfare
1.00
0.74
institutions and organizations.

1.12 0.99
0.98 1.05
Stockpile of food nearing theend of its best-by date
0.72
0.65
0.63 0.58
Activities
inregions
throughout
Japan
WEB
0.54
0.52
0.49
http://www.furukawa.co.jp/english/csr/social/activity.htm
0.47
0.50
0.57
0.27
0.37
Overseas0.30
Affiliates0.25
Provide Reconstruction
0.14

Supportfor the Region Affected by the Great East(FY)02003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Japan Earthquake
Furukawa FITEL (Thailand) Co., Ltd. (FFT)The Kingdom of Thailand
FFT volunteers made and soldwithin the company T-shirts
emblazoned with FFT’s name. All
the funds they raised in this way,after expenses, were provided as
relief money.

Furukawa Electric Autoparts (Philippines) Inc. (FEAP)
The Republic of the Philippines
FEAP provided its donations and funds solicited throughemployee donations as relief funds through the Philippine
Red Cross Society.
Clearing brush from mountain pathways

Taking away a fallen tree

Setting up a notice board

Providing relief funds via the Red Cross

Furukawa Electric Group Sustainability Report 201238

Strengthening Management
The Furukawa Electric Group properly monitors our business practices
and endeavors to establish structures for improving them, so as tosteadily meet our responsibilities to our various stakeholders,
who view us from differing perspectives.

Main Stakeholders and Main Responsibilities

Environment

Local
communities

Customers

Suppliers

FURUKAWA
ELECTRICGroup

Employees

Main Stakeholders

Shareholders

Means of Communication

Main Responsibilities

EnvironmentsReduce emission of gases that contribute to global warmingsPromote energy conservation and recyclingsProtect biodiversity
sCurtail industrial wastesManage and reduce harmful chemical substancessCompliance with laws and regulations
sCompliance with the Kyoto Protocol and the Nagoya Protocol on
biodiversitysResponse to environmental activities of the Ministry of theEnvironment and other government organs
sResearch and information exchange on biodiversity preservation
through JBIB*

CustomerssMaintain and improve the quality of products, operations andservicessOffer products and services that are useful to societysProvide solutions to issues confronting customers through a broadarray of technologies and know-how

sDialogue through regular businesssWebsite, Sustainability Reports
sDialogue at technology exhibitions, trade shows

SupplierssEstablish a sound relationship founded on fair trading incompliance with laws and regulations
sRealize CSR throughout the supply chain by implementing CSR
Deployment Guideline for Business Partners

sPartner Meetings
sDialogue through regular businesssCSR surveys
sFeedback interviews on results of partner evaluations

ShareholderssProvide appropriate returnssEnsure timely and appropriate disclosuresEnhance corporate value

sSustainability Reports
sGeneral meetings of shareholders, shareholder reports
sManagement briefings and results presentations
sInvestor visitssShareholder plant tours

EmployeessRespect human rights
sCultivate and appropriately value and reward human resources
sPromote health, including occupational health and safety, as wellas mental healthsSupport diverse workstyles and work/life balancesInternal newsletter, intranet
sManagement briefings

Local
communities

sNurture future generationsPromote sporting and cultural activities
sLive in harmony with the natural environment and local
communities

sFactory tours
sCooperate with and sponsor sports and traditional eventssSupport the activities of and collaborate with local NPOssPreserve the Satoyama Environment* Japan Business Initiative for Biodiversity. Founded in 2008, the JBIB is a joint effort by
Japanese companies to act on behalf of biodiversity preservation.

39

Furukawa Electric Group Sustainability Report 2012

Strengthening Management

Corporate Governance
The Furukawa Electric Group strives to maintain sound management by constructing and upgrading highly transparent
and efficient internal control systems.

are independent of the Board of Directors. We continue tomake every effort to strengthen our audit functions throughclose collaboration between our Corporate Auditors,
Accounting Auditors and the CSR Division, which acts as ourinternal auditing department, including sharing informationand exchanging opinions.

Board of Directors and Board of
Corporate Auditors
Board of Directors
The Furukawa Electric Board of Directors is composed of
11 directors, including two Outside Directors. This is so as
to receive advice and opinions from an outside perspective
in Board of Directors meeting discussions and decisions.
It helps to ensure transparency in decision-making, andstrengthens the oversight function in management overall.
The Outside Directors bring their rich experience fromthe worlds of trading and corporations, and provide valuableadvice and guidance from a variety of perspectives, andthe Board takes these into serious consideration in making
decisions. Therefore, we have created a system that enables
Outside Directors and Outside Auditors to perform theirduties smoothly, which includes doing our best to schedule
our Board of Directors meetings so that our Outside Directors
and Outside Auditors are able to attend, provide them with
documentation several days in advance and also to provide
them with detailed prior explanations so as to deepen theirunderstanding sufficiently in regard to items of discussion.
The Compensation Committee, which includes Outside
Directors, is charged by the Board with the policy oncompensation of directors and the details of individualcompensation, so as to maintain transparency in thedecision process and eliminate arbitrariness.

Operational Performance
Our operational structure is based on a company system anda chief officer system. Under the supervision of the president,
who is responsible for overall operational performance,
operations are run by company presidents, and operations
relating to matters such as groupwide strategies, resource
allocation and administration are handled by the relevant
chief officer. Details are then reported back to the Board of
Directors on a quarterly basis.

Internal Control
Our Group internal control system is implemented withthe understanding that internal control maintains andenhances the efficiency of operational performance, ensurescompliance, manages risk and information, and overseesGroup companies. The CSR Division Administration
Department Internal Control System Group upgrades
the system, and also assesses and seeks to improve its
operations. The Group J-SOX Committee and the CSR
Division are responsible for composing the Furukawa ElectricGroup’s financial reports as required under the Financial
Instruments and Exchange Act, and maintaining andenhancing their credibility.

Board of Corporate Auditors
Furukawa Electric has in place a Board of Auditors. We
place great importance on the function performed by our
Corporate Auditors and Board of Corporate Auditors, which
Corporate governance organization chart

Shareholders’ Meeting

Monitoring
andSupervising

Appoint
Submit proposals
and reports

Appoint

Board of Directors
11 Directors (including 2 outside directors)
Submit reports,
attend meetings
and audits

CSR and Risk Management Committee
CommitPresident, Company Presidents, Chief Officers
Special Committees
Central Committee for Environmental Management
Central Compliance Committee, etc.

Monitors

Business
Operations

Appoint

Audit accounts

Board of Corporate Auditors
5 Corporate Auditors (including 3 outside auditors)

Submit reports

Collaboration between auditsCompensation Committees Decision of critical matters relating to business operationss Supervise business operations

Accounting
Auditorss Screen reports relating to businesss Examine status of operations and assets

s Screen reports relating
to accountings Examine status ofoperations and assets

Appoint

ChairmanPresident
AdviseManagement Committee
Chairman, President, Chief Officers, Company Presidents

Submit reports

Direction

CSO (Chief Strategy Officer)
CFO (Chief Financial Officer)

Internal Audit (CSR Division)

Chief Officers
CMO (Chief Marketing Officer)
CPO (Chief Production Officer)

CSRO (Chief Social Responsibility Officer)
CTO (Chief Technology Officer)

Provide support and guidanceBusiness
operations

Company Presidents

Furukawa-Sky Aluminum Corporation

Telecommunications Company, Energy and Industrial Products Company, Metals Company, Electronics and Automotive Systems Company

Light Metals Company

Affiliate Companies

Other affiliate companies

Furukawa Electric Group Sustainability Report 201240

Strengthening Management

CSR Management
The Furukawa Electric Group has created a specialized unit for taking a unified approach to CSR activities, including
strengthening compliance and risk management.

CSR Promotion Framework
The Furukawa Electric Group established the CSR Division
as a specialized unit for promoting CSR activities andappointed a Chief Social Responsibility Officer (CSRO) to
supervise its operations in accordance with the Group’s
Basic Policy on CSR. It enhances the monitoring of overall
corporate practices from the point of view of CSR concerns
such as internal controls, compliance, risk management,
safety, environmental conservation, and social contribution,and takes a unified approach to CSR-related activities. In theevent a problem occurs, it provides a system for taking thenecessary measures, such as investigating the backgroundof the problem and elucidating the cause, establishing andimplementing remedial and recurrence prevention measures,
disclosure, etc.

Furukawa Electric Group Basic Policy on CSR

necessary.
In line with the Group’s development of business inglobal markets, the risks that it faces grow more diverse andcomplex each year. Going forward, we plan to reorganize
our risk management structure, integrating it with the
management control function to create a more effective risk
management organization.

Business Continuity Management (BCM)
The Furukawa Electric Group has established a BusinessContinuity Management System (BCMS). We pursue
groupwide BCM activities based on this system.
In fiscal 2012, we distributed a companywide
questionnaire to evaluate our response to the Great East
Japan Earthquake. Based on the responses we received, werevised our Crisis Management Rules (Companywide Rules)
and Emergency Response Headquarters Establishment
and Operation Manual (CSR Standards) and created a new
Emergency Contact Card.

Based on the Furukawa Electric Group Corporate Philosophy,•We will operate our businesses in harmony with society andthe environment and endeavor to create social value throughtechnological innovation, complying with laws, social norms,
and ethics as a member of the international community.
•We will strive to maintain and build sound and friendly
relationships with all of our stakeholders and contribute to
the sustainable development of society.

WEB

CSR Promotion Framework

http://www.furukawa.co.jp/english/csr/management/csr_manage.htm
Emergency Contact Card

Risk Management
Risk Management
Our CSR and Risk Management Committee conduct
regular risk assessments, identifying and evaluating risks.
The committee defines important risks that require acompanywide response and promotes measures to address
them.
The CSR and Risk Management Committee Secretariat
reports the status of progress on these measures to thecommittee and the Board of Directors and follows up, as
Important companywide risks and priority management
items (fiscal 2012)
Important Companywide Risks
1. Compliance
2. Quality control
3. Large-scale disasters, such as
earthquakes
4. Information security
5. Affiliated company controls

41

Priority Management Items (Fiscal 2012)
1. Occupational safety
2. Management of toxic and poisonous
substances

Furukawa Electric Group Sustainability Report 2012

Furthermore, we conducted BCP Exercise Assuming
a Tokai Earthquake at our Hiratsuka Works (October),
BCP Exercise Assuming a Tokyo Metropolitan Earthquakeat our Chiba Works (November) and Incident Response
Exercise Assuming a Tokyo Metropolitan Earthquake at ourheadquarters (December). We confirmed the viability of theabovementioned rules and manuals, and held discussions
to envision potential situations. The Central Disaster
Prevention and Business Continuity Management Promotion
Committee, the body that promotes groupwide disasterprevention and BCM activities, deliberated the results ofthese discussions, and we are now in the process of making
further revisions.
Four of our affiliated companies suffered damage fromthe flooding in Thailand in October 2011, and temporarilysuspended production. We had alternative productionin place within two months, but we recognize that our
response to this risk had been insufficient. Learning from

this experience, we will improve our BCM activities going
forward.
In recognition of our efforts, in April 2012 we received the
BCAO Award 2011*, the “Award for Practical Excellence”
from the Business Continuity Advancement Association(BCAO), a specified nonprofit organization managed by
the Japanese Cabinet Office. We were evaluated highlyin three areas: “efforts to promote companywide BCM
activities through committee action,” “the rapid restorationof works following the Great East Japan Earthquake throughthe actual operation of
established BCPs,” and“proactively communicating
information pertaining to
the experience outside thecompany.”* This award is presented to recognize
individuals and organizations inJapan that contribute to the spreadand implementation of business
continuity (BC) activities.
Award ceremony

Compliance
Instilling Compliance Globally throughout theGroup
The Furukawa Electric Group is working to augmentgroupwide compliance, including at overseas bases. These
efforts are designed to identify changes in the businessenvironment resulting from global developments andchanges in the positioning of compliance within internationalsociety, as well as taking into account our international scopeof activities.
In fiscal 2012, in accordance with our March 2011
revision of the Furukawa Electric Group CSR Code ofInternational version (English)

International version (Indonesian)International version (Thai)

China area version (Chinese)

Conduct, we issued the fourth edition of the Furukawa
Electric Group CSR Compliance Handbook, which serves
as an instruction manual. Furthermore, to instill at overseas
affiliated companies our Group corporate philosophy andcode of conduct, we held meetings to exchange ideas in
China and Southeast Asia, and we published internationaland China area version of the handbook. In addition, toensure our compliance with individual countries’ competition
laws, we published a bilingual Japanese/English Competition
Laws Compliance Guide that outlines the content thatoverseas affiliated companies need to put into practice.
We have shared this information groupwide to prevent any
recurrence of breaches of conpetition laws.
Exchanges of Ideas in China and Southeast Asia
In August 2011, our CSR Division hosted Internal Control
Presentations/Exchanges of Ideas Pertaining to Compliancein Shanghai, Tianjin and Bangkok. The representatives ofaffiliated companies in China and Southeast Asia participatedin these activities. After
explaining the revisions
to the Furukawa
Electric Group CSR
Code of Conduct, we
had exchanges of ideas
on global compliancepromotion.
Meeting to exchange ideas (Tianjin, China)
Preventing Bribery
Anti-bribery laws, including but not limited to the U.S.
Foreign Corrupt Practices Act and the UK Bribery Act haverecently being strengthened, and government agencies are
increasingly active on their enforcement. Accordingly, theFurukawa Electric group is continuously determined thatthe groupwide management of bribery risks is of the utmost
importance.
During fiscal 2012, we conducted bribery risk
assessments targeting overseas affiliated companies todetermine the degree to which they were currently facing therisk of bribery. To enhance our own measures in this area, in
April 2012 we formulated the Furukawa Electric Group AntiBribery Statement.
Going forward, we will create a groupwide bribery risk
management system, drawing up guidelines for consistentaction across the Group and conducting awarenessactivities.

International and China area versions of our CSR Compliance Handbook

Furukawa Electric Group Sustainability Report 201242

Strengthening Management

CSR Management

Monitoring
Voluntary Compliance Checks
Furukawa Electric has designated October and Novemberof each year as “Compliance Months,” during which we
execute compliance activities. During this period, one such
effort was our Voluntary Compliance-Checking Activities.
In fiscal 2012, we asked each department conduct selfchecks with check sheets covering four areas: the AntiMonopoly Act, dispatch and contract work, subcontracting
transactions and occupational safety. We plan to expand
areas covered by such check sheets in an effort to enhance
this activity. In addition, we are developing the informationin check sheets for affiliated companies in order to raisegroupwide awareness.
Employee Compliance Awareness Surveys
We conduct compliance awareness surveys targeting theemployees of Furukawa Electric and affiliated companies inalternate years. Designed to gauge employee awarenessand understanding of compliance, these surveys aim toencourage recognition of compliance. In fiscal 2012, we
conducted such surveys targeting approximately 5,400
employees. In fiscal 2013, we plan to boost complianceawareness and strengthen risk management based on
survey results.

Compliance Education
The Furukawa Electric Group conducts complianceeducation for employees at every level of the Company, fromnew recruits to directors. Furthermore, we hold theme-based
group training such as seminars related to the Anti-Monopoly
Act and e-learning courses, and conduct groupwide
compliance education.
WEB

Compliance education in fiscal 2012

http://www.furukawa.co.jp/english/csr/management/comp.htm

Report on Anti-Monopoly Act Violations
In September 2011, the Company entered into a plea
agreement with the U.S. Department of Justice concerning
allegations of cartel activities with certain competitors involving
transactions of automotive wire harness products. In court
proceedings following this agreement, the Company wasassessed a fine of US$200 million. Investigations involving
transactions on these same products are also underway by
the authorities of some countries, including the European
Commission. In Japan, the Japan Fair Trade Commission
submitted an order related to transactions on these products
in January 2012. Although we were not the recipient of thisorder, we were cited within the order as being in violation.
Furthermore, in July 2011, we received from the Japan Fair
Trade Commission cease and desist as well as administrative
surcharge orders in relation to Anti-Monopoly Act violations by
two of our domestic subsidiaries involving transactions related
to wire and cable products for construction and interior wiring.
Also in July 2011, equity method affiliate VISCAS Corporation
received from the European Commission a Statement of
Objections* related to transactions involving power cables and43

Furukawa Electric Group Sustainability Report 2012

related products, and this investigation is ongoing.
On December 10, 2009, the Furukawa Electric Group
released the report of the Third-Party Investigation Committee
on Violations of the Anti-Monopoly Act. Prior to releasing thereport, we had investigations conducted by outside attorneys
with the aim of preventing and eradicating activity considered
to be in potential violation of the Anti-Monopoly Act, and we
introduced groupwide recurrence prevention measures, basedon the committee’s findings. Although the abovementioned
proceedings and investigations result from transactions priorto December 2009, we apologize sincerely to all related parties
for the concern and trouble we have caused them over a
prolonged period. We will continue working to restore publictrust through thorough compliance activities at each company
in the Furukawa Electric Group, both in Japan and overseas.
* A “Statement of Objections” indicates a provisional opinion by theEuropean Commission concerning suspicion of infringement of European
competition laws, and requests a statement by the party or parties
involved. The Statement of Objections document is currently under
examination, and no final determination has been made.

Targets and Results
The Furukawa Electric Group sets firm targets for our CSR efforts based upon our CSR Code of Conduct, and seeks to
upgrade these efforts through use of the PDCA Cycle.
Initiatives for Society
Fiscal 2012 Targets

Fiscal 2012 Results

Quality(P. 28)•Reduction of quality
complaints.
…10% in comparison withfiscal 2011

•Reduced by 37% compared with fiscal 2011○

•Reduce by 10% compared with fiscal 2012

Procurement(P. 31)•Execute partner
assessments and feedback
consultations•Disclosure of CSR
Deployment Guideline(English edition) foroverseas partners•Assessed main partners and held feedback consultations•Posted the English version of the CSR Deployment Guideline on
our website○•Continue to conduct partner assessments and feedback
consultations•Roll out CSR Deployment Guideline for business
partners•Continue with Global
Development Program(GDP)•Performed GDP targeting overseas local corporate members (19people in frontline leadership positions)○•Continue with GDP (targeting section managers)•By fiscal 2014, reconfigure content of training in linewith new global human resource training system•Develop worksite capability
training at all works•Increase number of Senior
Trainers•Completed basic system for Manufacturing Training•Commenced Readiness Activities for people in charge of
operations at all works•Completed deployment of worksite capability training at all
works

○

•Introduce new training program…Training for forepersons, special training•Cultivate lecturers…Increase number of instructors and conduct brush-up
training•Promote creation of rules for global Group development•Look into and execute work
systems in response todisaster-related power
shortages•Began operating the systems indicated below in preparation forrolling blackouts and other unforeseen power outages (throughMarch 31, 2013)· Temporary suspension of work
· Annual leave allotment in hourly units· F lex-time without core hours· Working from home○­—

•Work from home system for•Introduced the following systems (from April 30, 2012)use during childcare leave,·W ork from home system for employees on childcare or
introduce return to work
nursing leavesystem for employees who· R eturn to work for employees who dropped out due todropped out due tochildbirth or childrearing (employment upon return)childbirth or childrearing○•Introduce into regular use a system of flex-time without
core hours, as well as work-at-home system for
employees other than those raising children•Reinforce safety activities…0 serious accidents,
accidents requiring leave 1or fewer×•0 serious accidents, accidents requiring leave 1 or
fewer

○

•Acquisition of JISHA OSHMS certification by the Copper
Tube Division•Introduced volunteer leave system to provide support for
restoration and reconstruction related to the Great East Japan
Earthquake•Provided information on intranet site about supporting volunteer
activities○•Increase applicability of volunteer leave system•Introduce volunteer activities conducted by employees
on a voluntary basis both within and outside theCompany

Fiscal 2012 Targets

Fiscal 2012 Results

Achievement

Fiscal 2013 Targets•Cultivate complianceawareness and promote its
spread on the front line

•Held “heart-to-heart communication between president andemployees” at the head office, 3 branches and 7 business sites•Executed 2nd Employee Compliance Awareness Survey○•Conduct CSR roundtables at each works•Conduct compliance awareness surveys targeting
employees of Group companies in Japan•Enhance complianceeducation•Published Furukawa Electric Group CSR Compliance Handbook(4th Edition), distributed and used in training•Published international and Chinese-language versions ofhandbook○•Conduct training related to safety-guaranteed export
management and bribery regulations•Hold compliance seminar for companies in China○•Formulate basic Group policies and guidelines on
preventing bribery•Create checklist for people with management
responsibility at overseas offices○•Promote response in relation to ISO 22301, theinternational standard on business continuity
management (BCM)•Conduct education for internal auditors to reinforce
BCM system

Personnel
Development andWorking
Environment(PP. 32–34)

Industrial Safety
and Health(PP. 35–36)

Social Contribution(PP. 37–38)•0 serious accidents, 4 accidents requiring leave•Construction of labor safety
and health management•Acquisition of JISHA OSHMS certification by the Nikko Works
system•Active social contribution
efforts

Achievement

Fiscal 2013 Targets

Strengthening Management

Risk Management/
Compliance(PP. 41–43)•Promote efforts to prevent
recurrence of infringements•Published groupwide Competition Laws Compliance Guide
to the Anti-Monopoly Act•Conducted self-check activities at each division using
and competition laws, asArea-Specific Check Sheets
well as complianceself-checking activities•Revise BCP and make it
more thoroughInitiatives for the Environment•Based on issues raised as a result of the Great East Japan
Earthquake, completely revised crisis management rules andrelated manuals•Conduced BCP training at the Chiba and Hiratsuka Works, andreflected results in our BCP

Refer to Targets and Performance (Environment) in this report (P.21)

Furukawa Electric Group Sustainability Report 201244

Third-Party Opinion

Dr. Naoki Adachi
CEO
Response Ability, Inc.
Studied plant ecology at the University of Tokyo, where he wasawarded a doctorate from the Graduate School of Science.
Undertook research concerning tropical forests at the National
Institute for Environmental Studies (NIES) and also at the Forest
Research Institute Malaysia (FRIM). After leaving NIES, he set up
his own consultancy business, specializing in corporate efforts
to conserve biodiversity and CSR procurement (supply chain
management). In addition to roles as a member of the Standing
Committee of the Ecological Society of Japan, an advisor to the
Sustainable Management Forum of Japan and Executive Directorof Japan Business Initiative for Biodiversity (JBIB), he also serveson the Ministry of the Environment’s Committee on Biodiversity
Private Sector Activities Guidelines and many other governmental
committees.

Furukawa Electric has this year elected to synthesize theinformation formerly contained in its CSR and annual reports as a
“Sustainability Report.” This appears to be in response to thetrend, particularly in Europe, to disclose a variety of non-financial
information, including that pertaining to environmental, social andgovernance (ESG), to investors. It is important in such reports toemploy clear indicators and show the items that companies aretargeting specifically. At this point, numerical targets are provided
mostly in the environmental field. Going forward, using moreeasy-to-understand indicators for the society and management
categories would make the report even easier to understand andsimplify comparisons. This report also deserves high marks forthe introduction, in President Shibata’s own words, of thebusinesses that Furukawa Electric will develop going forward(pages 7–10) and the special features on second-generation
high-temperature superconductor technologies (pages 11–16),
which explains specifically what sort of technologies theCompany has that will enable it to develop business in this field.
These introductions are detailed and clear.
As to sustainability, in times when life was much simpler,
clothing, food and housing were the main elements of people’s
lives to be sustainable. I believe that nowadays, energy andinformation needed to be added to that list. Furukawa Electric’s

45

Furukawa Electric Group Sustainability Report 2012businesses support these two needs, and the Company’s
technologies to efficiently transmit, store and create electricity
should each make major contributions to realizing a sustainable
society. As Furukawa Electric already possesses thesetechnologies, it has a definite advantage in exploiting them todevelop related businesses. The question that needs to beconsidered from a sustainability perspective is how the Company
will achieve these developments and realize the business.
Regardless of how many sophisticated technologies a company
has, products cannot be made without resources. As last year’s
flooding in Thailand demonstrated, unless a company can adapt
to weather disasters which are expected to be much more
severe, business stability will be lost. I would like to see Furukawa
Electric explain specifically how it will respond to such issues andwhat it is doing to guarantee the sustainability of the businesses
themselves. According to this report, at present the Company
has only short-term goals looking two to three years into the
future. I definitely hope that the Working Group for Sustainable
Planning (page 18) established this year will set targets andformulate plans to realize sustainability over the much longer
term, and that the Company will pursue activities accordingly.
These initiatives should focus not just on contributing tosociety through technology but also take the lead in promoting
new activities that will enable the Company to boost its own
sustainability, as well as that of society as a whole. For instance,in addition to promoting energy conservation, it should become
possible to shift to more renewable energy sources and to
generate renewable energy. Looking just at superconducting
cables, for example, by 2030 demand is expected to be 1.6
times the current level (page 13). Resource requirements arelikely to grow in direct relation to this demand increase. Suchquestions will arise as how to procure increasingly scarce metal
resources and how to shift from the use of petroleum-derived tobiologically-derived plastics. The Company needs to describe aclear path and start on specific actions.
In fiscal 2012, Furukawa Electric analyzed and evaluated therelationship between biodiversity and its businesses andformulated an action plan based on the issues discovered (page26). I was also involved in this process and became aware that
Furukawa Electric had a truly diverse relationship with biodiversity.
The reason companies undertake to conserve biodiversity is thatbiodiversity is directly connected to their business risks. Even
more important, however, is that biodiversity and the ecosystemservices are supporting corporate activities, so are they essential.
For this very reason, it is essential to minimize the loads thatbusinesses place on ecosystems; limiting this impact to the levelthat nature allows is the ultimate condition for sustainability.
Though this is an extremely challenging issue, I hope theCompany will look more deeply into this matter, and look forward
to Furukawa Electric showing the world exactly what asustainable company looks like.

GRI Guideline Table of Contents
No.

Indicators

Page

1. Strategy and Analysis
1.1Statement from the most senior decisionmaker of the organization about the relevance of sustainability to the organization and its strategy

7-10

1.2

Description of key impacts, risks, and opportunities

7-10, 11-16

2. Organizational Profile
2.1-2.8

Organizational profile

3-4, 5-6

2.9

Significant changes during the reporting period regarding size, structure, or ownership

No major changes

2.10

Awards received in the reporting period

CSR Data Book, page 6

3. Report Parameters3.1-3.3

Report Outline

1

3.4

Contact point for questions regarding the report or its contents

1

3.5

Process for defining report content

1, 39

3.6-3.8

Boundaries and scope of the report

1, 3-4

3.9

Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations applied to thecompilation of the Indicators and other information in the report

Data page

3.10-3.11

The reasons for and effects of restatements of information provided in earlier reports, as well as significant changes since the previous
reporting period

No repetition from the previous
report’s content nor major changes

3.12

Table identifying the location of the Standard Disclosures in the report

46

3.13

Policy and current practice with regard to seeking external assurance for the report

1, 45

4. Governance, Commitments, and Engagement
4.1-4.3

Outline of corporate governance

40

4.4

Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body30, 34

4.5-4.7

Corporate governance details

40

4.8

Internally developed statements of mission or values, codes of conduct, and principles

1

4.9-4.10

Process whereby the highest governance body oversees the organization’s identification and management of economic, environmental, and thatbody’s process for evaluating social performance

40-41
40-42

4.11

Explanation of whether and how the precautionary approach or principle is addressed by the organization

4.12

Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses 39

4.13

Memberships in associations (such as industry associations) and/or national/international advocacy organizations

Not indicated (JapaneseElectric Wire & Cable Makers’
Association, etc.)

4.14-4.17

Stakeholder engagement30-31, 34, 39

5. Performance Indicators
Economic

Management approach

5-6, 7-10EC8Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, inkind, or pro bono engagement

37-38

EC9

Understanding and describing significant indirect economic impacts, including the extent of impacts

18, CSR Data Book, page 4

Environmental Management approach

7-10, 21, 31

EN1

20

Materials used by weight or volume

EN3

Direct energy consumption by primary energy source

20

EN5

Energy saved due to conservation and efficiency improvements

23-24, CSR Data Book, page 2

EN6

Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of
these initiatives

11-16, 22, 29

EN7

Initiatives to reduce indirect energy consumption and reductions achieved

23

EN8

Total water withdrawal by source

20

EN14

Strategies, current actions, and future plans for managing impacts on biodiversity

26

EN16

Total direct and indirect greenhouse gas emissions by weight

20, 23-24

EN18

Initiatives to reduce greenhouse gas emissions and reductions achieved

20, 23-24

EN20

NO, SO, and other significant air emissions by type and weight

20

EN22

Total weight of waste by type and disposal method

23-24

EN26

Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

11-16, 22, 29

EN29

Significant environmental impacts of transporting products and other goods and materials used for the organization’s operations, and transporting
23
members of the workforce

EN30

Total environmental protection expenditures and investments by type

18, CSR Data Book, page 3

Product

Management approach

28-29, 44

PR1

Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant
products and services categories subject to such procedures

28-29

Labor

Management approach

32-36, 44

LA1

Total workforce by employment type, employment contract, and region

3

LA8

Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community
members regarding serious diseases

36

LA11

Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings 32-33

Human rights Management approachHR3

31, 32-34

Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including thepercentage of employees trained

43, web (Compliance Education)

Society

Management approach

42-43, 44

SO3

Percentage of employees trained in organization’s anti-corruption policies and procedures

43, web (Compliance Education)

SO4

Actions taken in response to incidents of corruption

42-43

SO7

Total number of legal actions for anticompetitive behavior, anti-trust, and monopoly practices and their outcomes

43

Furukawa Electric Group Sustainability Report 2012

46

Administration Department, CSR Division
2-3 Marunouchi 2-chome, Chiyoda-ku, Tokyo 100-8322, Japan
Tel: +81-3-3286-3044
Fax: +81-3-3286-3920
http://www.furukawa.co.jp/english/