Integrated Report 2022
Fiscal Year Ended December 2021

for the sustainable future

Nisshinbo Holdings Inc.
2-31-11, Ningyo-cho, Nihonbashi,
Chuo-ku, Tokyo 103-8650, JAPANTEL +81-3-5695-8833 FAX +81-3-5695-8970
www.nisshinbo.co.jp/english/

Nisshinbo Group Corporate Philosophy

Nisshinbo Group Operating Performance

Based on its commitment to VALUE and its Business Conduct Guidelines, which are derived fromNet Sales
Real Estate

stakeholders as an Environment and Energy Company group that works to create a sustainable society.

—The value we provide and the approach we take to realize
our Corporate Philosophy• We provide our customers with eco-friendly products andservices to create a safer and more secure society with integrity.
• We create new value to inspire and satisfy our customers.

• We improve upon our corporate value and meet the expectationsof our shareholders.

Business Conduct Guidelines— Standards of behavior expected of every Group employee• Respect for Human Rights

Entit

y

mental Spiri

Cons istent
Integrity• Respect for Diversity• Awareness and Concern towards our Environmental Impact• Safety is the Basis for Everything

t

Inno

• Thorough-Going Compliance

v at

i on

• Fair and Transparent Business Practices• Boldly Striving Forward

Precision
Instruments¥510.6 billion-4-8Automobile Brakes

Micro Devices

Wireless andCommunications

Automobile
BrakesMicro Devices

Chemicals

Precision
Instruments

Real Estate
OthersTextilesOperating Income/Loss*EPS

Shareholders’Equity Ratio
and ROE(billions of yen)

(yen)

（％）

25

250

20

200

40

15

150

30

10

100

20

5

50

10

0

0

0

(adjusted)

ROE

-10

2018.3 2018.12 2019.12 2020.12 2021.12

2018.3 2018.12 2018.12 2019.12 2020.12 2021.12• Quality Communication

Shareholders Equity Ratio

50

-50

-5

• Innovation

0

Period ended
December 2021

How We Achieve Sustainability

blic

Funda

Period ended
December 2021

8

Special Feature• We hold dear a corporate culture in which our employees canproudly work with vigor and boldly engage in new endeavors.

Pu

12

How We Manage Our Business

VALUE

Business Conduct
Guidelines¥21.7 billion(billions of yen)

4

Change and Challenge!
For the creation of the future of Earth and People.

VALUE

TextilesWireless andCommunications

Chemicals

Nisshinbo Group Corporate Philosophy

Corporate
Philosophy

Others

Where We’ve Come From,
Where We’re Going

the Corporate Philosophy, the Nisshinbo Group aims to increase corporate value together withOperating Income

2018.3 2018.12 2019.12 2020.12 2021.12*Operating income for the fiscal year ended December
2018 has been adjusted to facilitate the year-on-yearcomparison.

Where We’ve Come From, Where We’re Going
C2 Nisshinbo Group Corporate Philosophy
1 Nisshinbo Group Operating
		 Performance
2 Nisshinbo Group History
4 The Nisshinbo Group’s		 Value-Creation Process
6 Nisshinbo Group Strategic Business		 Domains and Business Segments
8 Message from the President
14 Three Strategic Business Domains
22 Nisshinbo Group Financial Strategy

32 Creation of a Safe and Secure Society
34 Contribution to the Environmental
		 and Energy Field
35 Reports Based on the TCFD
		 Recommendations
37 Message from the Chairman and Director
38 Corporate Governance
42 Compliance
43 Risk Management
44 Outside Director Discussion with the		 President of Nisshinbo Micro Devices

Special Feature

46 Board of Directors, Audit & Supervisory
		 Board Members and Managing Officers

24 Value Co-creation with Stakeholders

Overview of Business Segments

How We Achieve Sustainability

50 At a Glance

28 ESG Initiatives －		 Materiality, Risks and Opportunities

51 Wireless and Communications

57 Automobile Brakes
59 Precision Instruments
61 Chemicals

Research andDevelopment Expenses

Greenhouse Gas (GHG) Emissions(thousands)(billions of yen)(Thousand t-CO2e)

25

25

20

20

15

15

1,000

Energy-related GHG
Non-energy-related GHG

63 Textiles
65 Real Estate

750

Data Section
66 Financials

Eleven-Year Summary

68		
			

Management’s Discussion
and Analysis

70		

Financial Statements

500
10

10

5

5

Data Section

How We Manage Our Business

30 Nisshinbo Group		 Human Resources Strategy

Number of Employees

74 Key Companies in the Nisshinbo Group
75 Major External Assessments
76 Corporate Data
77 Integrated Report 2022 Publication and		 Corporate Website Guidance

Overview of Business Segments

Contents

250

0

0

2018.3 2018.12 2019.12 2020.12 2021.12

0

2018.3 2018.12 2019.12 2020.12 2021.12

2017

2018

2019

2020

2021

54 Micro Devices

1

Nisshinbo Group History

Devices Inc. and Nisshinbo Brake Inc. Based on our corporate philosophy, we have continued to grow

Nisshinbo Group Net Sales (billions of yen)
Electronics (Wireless and Communications, Micro Devices)by proactively promoting portfolio reforms in response to the needs of today to contribute to human600

society through our business activities.

500

Each diversified business leverages synergies linked to technological capabilities and global sales
developments constituting the current form of the Nisshinbo Group.

Automobile Brakes

Others* Nine months of results due to change in ﬁscal year-end

400
300

Where We’ve Come From,
Where We’re Going

The Nisshinbo Group began with operating companies such as Japan Radio Co., Ltd., Nisshinbo Micro

200

How We Manage Our Business

100

1878～

1940～

1950～

0

2000～

2012.32013.32014.32015.32016.32017.32018.32018.12*2019.122020.122021.12

1878

1944

1958

2005

• Walter Willson Cobbett Ltd.,TMD’s forerunner company,
founded• Production of friction materials started• Established Nihon Kohbunshikan Co.,
Ltd., begins production of plastic
bobbins• New Japan Radio Co., Ltd.,
becomes a consolidated
subsidiary

1946

1949

• Nippon Radio Telegraph Manufacturing
Co. founded(now Japan Radio Co., Ltd.)• Nagano Japan Radio Co., Ltd.,
Ueda Japan Radio Co., Ltd., andTOKYO SHIRTS CO., LTD., founded

Challenges in each era• National modernization andindustrialization

Nisshinbo Group’s role• New Japan Radio Co., Ltd., founded• Transition in key industries(from textiles to automobiles)• Contributed to Japan’s modernization
as a cotton textile maker

The Group’s Contribution

Supported development of
automotive sector as a specialist
supplier of friction materials

Businesssegments

Textiles• TMD Friction Group S.A. acquired
2013

2017

• Alphatron Marine Beheer B.V.
acquired• Papers business sold
• Japan Radio Co., Ltd.,
becomes a wholly owned
consolidated subsidiary

2019

2022
• Nisshinbo Micro Devices Inc.
founded• D-CLUE Technologies Co., Ltd.,acquired• NJ Components Co., Ltd., acquired

Targeting specific SDGs where Nisshinbo can make a real contribution while also taking into account all 17 SDGs

Life &
Healthcare●○

Automobile
Brakes●Precision
Instruments●

Wireless andCommunications

●

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●

Micro Devices

●

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●

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Chemicals

●

●

●

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○

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○

●

Real Estate

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○

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○

○

○

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Target 3.6

Target 7.3

Target 3.2

Target 3.2: Reduce the infant mortality rate
Target 3.6: Halve the number of global deaths and injuries
from road traffic accidents

Target 7.3: Double the global rate of improvement inenergy efficiency

Target 9.4

Target 13.1

Target 9.4

Target 9.4: Improve sustainability with environmentallysound technologies

Target 13.1: Strengthen resilience to climate-related
hazards and natural disasters

Core SDG objectives and targets in our business

2

2011

acquired• Helping to create a super-smart society as an Environment and Energy Company groupa specialist supplier of friction materials

Mobility2015• TOKYO SHIRTS CO., LTD.,acquired• Nanbu Plastics Co., Ltd.,acquired• Global warming and othershared issues faced by mankind• Supported development of automotive sector as

Infrastructure& Safety

2020• RBI GmbH and LEAS GmbH

Data Section

Helping to create a super-smart
societyas an Environment and Energy
Company group

Strategic businessdomains2018• Foundation brakes business sold
• Acquired Ricoh Electronic Devices
Co., Ltd., making it a consolidated
subsidiary• ProNav AS acquired• New Japan Radio Co., Ltd.,
becomes a wholly owned
subsidiary

Overview of Business Segments

Contributed to Japan’s modernization
as a cotton textile makerNissinbo Group’s contribution

1959

2014
• CHOYA CORP. sold

How We Achieve Sustainability

1915

1907

2010
• Japan Radio Co., Ltd., and Nagano
Japan Radio Co., Ltd., become
consolidated subsidiaries

Special Feature• Nisshin Cotton Spinning Co., Ltd., founded• Nisshin Cotton Spinning Co., Ltd.,
starts operating its Nishi Arai Plant as achemicals production facility

Holding company system adopted

Business portfolio reforms

3

The Nisshinbo Group’s Value-Creation Process

Where We’ve Come From,
Where We’re Going

The Nisshinbo Group has flexibly reshuffled its business portfolio based on the Group Corporate
Philosophy while responding to changes in the external environment to achieve its clear vision ofrealizing a super-smart society. The products and solutions created as a result are steadily meeting
market needs and gaining support.

Safe and secure lifestyles
Outputs/Outcome

Financial baseFinancial results

272.6 billion¥◦ Equity◦ Interest-bearing debt

◦2025 ROE target

131.8 billion

Dividend payout ratio target

Japan and the world

39
86

24 countries◦ Mobility-related◦ Number of consolidated employees◦ Ratio of overseas employees

52%Intellectual property◦ R&D expenses

23.7 billion¥

technological capabilities◦ Minerals◦ Water resources◦ Energy

4

The quality of a company is thesum of its people, not thebusiness itself

related◦ Life & healthcare-related

Impact on society andthe environment

Providing solutions to issues directly

Ability toconnect
peoplefacing human society

Environmental
destruction◦ Specialized humanresources◦ Increase in female managers◦ Realization of diversity◦ Joint research anddevelopment results
through open innovation◦ Realization of a safe andsecure global supply chain◦ CO₂ reductions (products)◦ CO₂ reductions (business)▶

Global environmental protection
and improvement

Extreme weather response ▶ Early warning ＝ Defensive solutions

Group Corporate
Philosophy

ESG management

Business policies
Public entity
founding spirit＝ Offensive solutions

Ability
to fusetechnologies

Materiality◦ Contribution to the 		environmental and energy
field▶ P.34◦ Creation of a safe and securesociety▶ P.32◦ Global compliance▶ P.38Strategies◦ Resolving social issues
through business▶ P.24
Value Co-creation with Stakeholders◦ Focusing efforts in strategic
business domains▶ P.14Three Strategic Business Domains◦ Management baseenhancements

KPI◦ Products and services
contributing to a sustainable
society

Data Section◦ Patents, know-how,

Ongoing business portfoliochanges to meet the demands of a
new age and society.

Overview of Business Segments

21,112 peoplep◦ Infrastructure & safety-

Human resources

Natural resources

g

u
ro

How We Achieve Sustainability◦ Global footprint%

Development of new
products and services◦ Sales network spanning◦ Group companies
overseas

Global issues

Special Feature

30

Sales basein Japan

Opportunities
and risks◦ Stable dividends¥◦ Group companies

12%

Realizing a
super-smart society

Changes in the external
environment

How We Manage Our BusinessInputs◦ Proportion of sales in growthbusiness areas◦ Non-financial indicators(e.g., human resources,
supply chain, quality,
environment, governance)5

Nisshinbo Group Strategic Business Domains and Business Segments

three strategic business domains in which it concentrates management resources.
The graphic below illustrates how each business segment is positioned within the businessportfolio and how they are related to the strategic business domains.
Nisshinbo will leverage technologies and networks possessed by its various businesses to create
new innovations leading to the enhancement of corporate value.

More than 100 years oftechnologies originating frommarine systems

Where We’ve Come From,
Where We’re Going

In addition to promoting the reorganization of its business portfolio, the Nisshinbo Group establishedContributing to disasterprevention and mitigation in
the fields of weather, waterand river management

Business scale
Global top share expanded due
to copper-free friction materials
and environmental contributions

Automobile

Generating cash for growthinvestments(idle plant site utilization)

In
fra
st
ru
ct
ur
e

Established joint venture with
Continental in 2000 to jointly
develop autonomous driving
technologies

Contributing to enhanced
corporate value withenvironmentally friendly
products

Mo
bili
ty

Micro Devices
&

Sa
fe
ty

Overview of Business Segments

TextilesCommunications

How We Achieve Sustainability

Precision
Instruments

Wireless andSpecial Feature

BrakesHow We Manage Our Business

Strengths in signal processing ICs and power
supply ICs
Increased demand for use in automobiles andindustrial equipment

Fuel cell separators and otherenvironmental technologies

Chemicals

Stability
6

Data Section

Real
EstateLife & Healthcare

Growth potential7Message from the President

Transformation and Growth

Where We’ve Come From,
Where We’re Going

Ongoing Business Portfolio

Nisshinbo Group Corporate Philosophy

as an Environment andChange and Challenge!
For the creation of the future of Earth and People.

Energy Company groupsociety and shifting focus to the environment and energy fields

How We Manage Our Business

Adapting to the changing demands of modern life andTargeting three strategic business fields

Business Policies

Realize a super-smart society as
an Environment and Energy Company group
Aiming to increase corporate value
through business policies closely linked to our
Corporate Philosophy

Special Feature

Strategic Business Domains

Masahiro Murakami
President and Representative Director
Nisshinbo Holdings Inc.

How We Achieve Sustainability

Viewing the Challenging External
Environment as an Opportunity for Growth

response to the pandemic, as well as semiconductor
shortages, soaring raw material costs and otherbusiness operation risks, from the beginning of 2022,

With the mission of contributing to society throughglobal political tensions, the end of monetary easing
and environmental destabilization driven by climate

a super-smart society as an Environment and Energychange have all exacerbated uncertainty about theCompany group based on business policies guided

future. I view this challenging external environment

by our Corporate Philosophy“Change and Challenge!

as a tremendous opportunity for the Group to realize

For the creation of the future of Earth and People.”further growth through efforts including the promotion

We have formulated a growth strategy to realize theseof strategic investments and business revitalization.

business policies and have implemented businessportfolio transformations through the cultivation of
new businesses and M&A activities. As a result, Groupbusinesses having different roots were integrated,

Realization of Efforts to Generate Operating
Cash Flow in 2021

Infrastructure & Safety

Life & Healthcare

Weather radar
Disaster prevention
solutions
Alertmarker+, etc.

Ultrasound imaging equipment
Medical equipment andhealthcare management
equipment development, etc.

The success of these efforts is evident in theprevention and mitigation business enhancements

numbers, which indicate that we remain on track forand autonomous vessel navigation initiatives. In Microbusiness performance recovery. Net sales amounted to

Devices, we promoted a return to regular pricing¥510.6 billion, up 11.7% compared with the previous

levels following price rollbacks, while preparing

fiscal year. In terms of profit, operating income

for the integration of New Japan Radio and Ricoh

skyrocketed 1,645.8% to ¥21.7 billion, ordinary

Electronic Devices, which was completed with the

To achieve growth, Nisshinbo must improve businessincome soared 631.5% to ¥25.3 billion and net income

launch of new company Nisshinbo Micro Devices

diversity.

profits, enhance profitability and increase operating

attributable to owners of the company jumped 83.3%

in January 2022. In Automobile Brakes, Nisshinbo

cash flows. To this end, since 2020, under the slogan

to ¥24.8 billion compared with the previous fiscal

Brake attempted to strengthen bases in the United

values as drivers of growth, we will pursue synergies“Generation of Operating Cash Flow,”we haveyear. All indicators significantly exceeded results in theStates and European subsidiary TMD consolidated

between technologies and sales transcending themade efforts to improve profitability that include

previous fiscal year, solidifying Nisshinbo’s earnings

bases in Germany and closed bases in France, whileboundaries of each business.

thorough cost controls and strategic pricing, selective

base for executing growth strategies.

at the same time, business was strengthened in

Scanning the current social landscape, in addition
to various restrictions on economic activities in

8

concentration on the business and product portfolio,
and continuous inventory reductions.

In Wireless and Communications, we steadfastly
executed growth strategies such as disaster

Data Section

facilitating the transition from a multilateral stage to
To leverage the diversity of businesses, people andOverview of Business Segments

business activities, the Nisshinbo Group aims to realize

Mobility
Copper-free friction materials
Fuel cell vehicle parts and materials
Marine wireless communicationequipment, etc.

Romania and Brazil. Regarding Precision Instruments,
in molding products, we closed unprofitable bases in

9Message from the President

February 2022 acquisition of D-CLUE Technologies

forward. Due to demand for the mass production

and consolidated bases in Kyushu, while expandingis another step in the implementation of this growthof products used in the Mobility domain, including

the Fujieda Plant facility to facilitate medical businessstrategy. The semiconductor market is expected to

cutting-edge radar equipment, we will consider thegrowth. In Chemicals, in response to strong demandremain robust in the near term, thus we expect solid

utilization of mass-production technologies cultivatedfor bipolar plates for fuel cells, Nisshinbo made theperformance in 2022.

in Textiles and Automobile Brakes.

decision to expand facilities, including the construction

In Automobile Brakes, orders for copper-reduced

Where We’ve Come From,
Where We’re GoingIndonesia, consolidated and closed bases in China,

In Infrastructure & Safety, we will maintain socialand copper-free friction materials complying with

infrastructure while promoting initiatives aimed at

speed spinning equipment performing favorably in Brazil

environmental regulations are expected to remain

protecting human life through disaster prevention andand considering its horizontal deployment in Indonesia,

firm. In addition, the TMD Group, which has been

mitigation. For example, weather radar ascertaining

we revised the TOKYO SHIRTS retail strategy, instituting

restructuring its business for several years and is

weather information, water and river informationa policy of targeting growth centered on Online Merges

now seeing the concrete results of these efforts, will

systems, and Alertmarker+, which automaticallywith Offline (OMO) businesses fusing e-commerce withleverage its strength and dominant position in thedisseminates disaster-related and other information by

online and offline business.

aftermarket business to recover profitability.

connecting to existing displays, contribute to solutions

In Real Estate, we anticipate a decline in sales andthat protect human life from floods and other natural

Again in 2022, Business Expansion
Is Expected Mainly in Wireless andCommunications, Micro Devices andAutomobile Brakes

profits due to the conclusion of large housing lot sales

disasters. Japan Radio, which has a high market sharebusiness projects.

in aerospace and meteorological systems, as well as

determine the rise or fall of its business. Accordingly, I

water and river information systems, is enhancing the

make sincere efforts to engage in direct and proactive

except Real Estate, including the three mainstay

performance of weather radar that detects abnormal

communications with Nisshinbo employees to facilitatebusinesses comprising Wireless and Communications,weather such as localized torrential rainstorms at anstronger consent and understanding. As overseas

Micro Devices and Automobile Brakes.

even earlier stage.

travel was restricted in 2021 due to the pandemic,

allocation of management resources on its threemainstay businesses: Wireless and Communications,year’
s slogan,“strengthening profitability throughbusiness transformations,”we will further promote

I repeatedly visited business sites in Japan where I

ultrasound diagnostic device manufactured by Ueda

engaged groups of 10–15 employees in hour-long

Japan Radio were launched by major medical device

dialogues. As I also conducted online dialogues with

manufacturer Terumo Corporation. We will continue

overseas bases, I was able to directly communicate

How We Achieve Sustainability

Micro Devices and Automobile Brakes. Under thisOngoing Business Portfolio Transformation,
Concentrating Management Resources inStrategic Business Domains

In Life & Healthcare, sales of the Group’s handheldwith more than 1,300 employees. During thesein wireless and communications technologies anddialogues, in addition to sharing my thoughts on the

In Wireless and Communications, public-sector

change. Ongoing changes and business transformation

medical devices. In this domain, although there will

direction of the Nisshinbo Group and the importancesolutions and specialized equipment are expected

represent offense-oriented management focused on

be longer timelines in terms of development speedof changes and challenges, we had an interactive

to remain firm, while in marine systems, we will

growth, and in 2022, we will continue to promoteand management cycles compared to the other two

discussion regarding what changes should be madeleverage resources accumulated thus far as the leadingbusiness portfolio transformation.

domains, we aim to provide products and services

and what challenges should be taken to build a betterthat contribute to telemedicine, remote treatment andfuture for the Group and individual employees.

company in marine radar equipment to expand thisWith a view to promoting business portfolio

domain to include data businesses, including support

transformation, we defined Mobility, Infrastructure

for autonomous vessel navigation.

& Safety and Life & Healthcare as strategic businessIn Micro Devices, we aim to create synergies

supervised nursing care.

When taking on challenges, it is quite natural to

Furthermore, we will promote business portfolio

encounter failure. I personally have experienced failure

domains for the concentration of managementtransformation and other offense-oriented management

in attempting to launch a new business that resulted

between technologies possessed by the two

resources. The Group’s strengths lie in the expertisewith the aim of sustainably improving ROIC and ROE.

in withdrawal from that business altogether. I strongly

companies integrated as Nisshinbo Micro Devices andin wireless and communications technologies it has

are targeting development in two domains: Energy

accumulated over more than a century, as well as

Management, comprising power supply ICs and battery

strong technological capabilities in such areas asmonitoring ICs, and Signal Processing, comprising

electronic devices and chemicals. We will integrate

operational amplifiers, comparators and other signal

these technologies to expand business across theprocessing ICs. In addition to providing these analog

Group.
Mobility refers to all moving objects, including

Fostering a Corporate Culture That
Encourages Personal Changes andChallenges

as a learning experience, which is why I said in the
dialogues,“This is not the kind of company where one or
two failures ends a career.”I was speaking from actual
experience. In terms of Human Resources systems, we

For a company to implement ongoing changes,

are attempting to cultivate a culture free from the fear

employees who support the company must also bearof failure by limiting evaluations to results from the two

the development of a“connected society”throughautomobiles, vessels, aircraft and man-made satellites.

in mind the views and opinions that precede changing

most recent fiscal years. It is my belief that a corporate

growth as an analog solutions provider that analyzes

The development of control and communication

times and incorporate them as individual behavioral

culture intolerant to failure gives rise to dishonesty, while

information collected through these devices andsystems for large drones, the demand for which ischanges. The phrase“business is people”emphasizes

a corporate culture that tolerates failure and can makeconverts it into high-value-added information. The

rapidly expanding, will be sequentially installed goingthat it is the employees working at a company who

positive use of it creates innovation.

10

11

Data Section

semiconductor devices, Nisshinbo will contribute tobelieve that the key to success is for teams to use failure

Overview of Business Segments

to promote collaborations between Group strengths
It is important for companies to engage in continuous

business transformations targeting growth.

Special Feature

In 2022, Nisshinbo will again concentrate theBusiness is expected to expand in all segments

How We Manage Our Businessof a new building. In Textiles, while enhancing high-Message from the Presidentof businesses and human resources, we must“unite indiversity”when promoting management at the Groupand global levels. For a company, the key to this lies inthe sharing and inculcation of its corporate philosophy.
Under a business policy aimed at realizing a super-smart

ESG is Nisshinbo’s founding spirit

S

Public Entity—Our founding spirit of contributing to society through business activities
We engage in ongoing dialogue with stakeholders (customers, shareholders, employees,
business partners, regional companies, etc.) to understand their requests and evaluations andreflect this information in our business activities.

G

2006

society as an Environment and Energy Company group,
we will proactively engage in the provision of products
and systems that contribute to protecting the global
environment and promoting alternative energy. We willleverage strengths accumulated in the manufacturing of
tangible products to heighten our focus on intangible

2015
2017

Contributing to the SDGs
through our business

How We Manage Our BusinessE

In 2006, we positioned global environmental protection as our top-priority social issue andreformed our business with a focus on the environment and energy.

We embarked on governance reforms, including the introduction of an outside
director system, before the enactment of Japan’s Corporate Governance Code
Abolished takeover defense measures
Abolished internal advisor and consultant system and formulated Nisshinbo’s
Corporate Governance Policy

products and services, transitioning to a businessstructure that uses DX to resolve new social issues andcontribute to the realization of a sustainable society.

the importance of contributing to society throughbusiness partners, local communities, national andbusiness activities as a public entity. In other words,

local governments, and all other stakeholders.

Without a Sustainable Global Environment,
the Economy Will Not Survive

before the advent of concepts such as the SDGs andof failure, digital transformation (DX) and diversity and

The Environment and Energy Company group businessinclusion (D&I) are key to promoting actual changes
and growth.

In a corporate culture that tolerates and makes use

shareholders, as well as customers, employees,

Within the Group, which is a fusion of diverse
businesses, the greatest mission of Nisshinbo Holdings

already been focused on pursuing the SDGs andas a holding company is formulating management

emphasizing the importance of ESG. With businesses,

policies and strategies that lead to greater stakeholder

policy was formulated in 2006. This was driven by

products and services that contribute to reducing CO2

value while allocating management resources

a sense of crisis about the global environment, withand protecting the environment, by achieving growthaccordingly. From a long-term perspective, it is also

the Group can expand its social contributions.

critical that the Group facilitates the incubation of

The Nisshinbo Group makes ongoing digitalthe catchphrase“global warming”as the rallying

investments to link DX with the expansion of new

cry. Fifteen years later, rather than improving, thebusiness. In addition to transforming processes such as

global environment has deteriorated even further,facing each business due to climate change. We

are unable to handle and accelerates the creation

work styles incorporating digital technologies and data,

and while global warming was replaced with the newlaunched scenario analyses in 2021, focusingof Group synergies that I mentioned earlier. Even if

the purpose of DX is to modify existing business andcatchphrase“climate change,”this crisis is still the top

initially on three business segments (Wireless andan individual company cannot handle something on

create new business models. With digital technologies

priority requiring a global response.

Communications solutions businesses, Automobile

its own, seeking collaboration with the Group offers

as the catalyst for accelerating innovations, we are

The COVID-19 pandemic made humanity keenly

To this end, we must identify risks and opportunities

development themes that individual Group companies

many benefits, including accelerated problem solving,aware that economic activity will be meaningless if notopportunities. In support of these analyses, in June

improved cost performance and the avoidance offor customers using the data collected by Nisshinbo

predicated on a sustainable society. In the background2021, we formulated and announced qualitative andintellectual property outflows. For example, having adevices to target business growth envisioning aof this unexpected pandemic, the global environmental

quantitative environmental targets to be achieved by

Chemicals business in the Group enables us to offertransition from manufacturing to the service industry.

crisis continues to slowly deepen. Despite the frequent2030. In 2022, the scope of analysis was widenedmaterials that meet the demand for improved electricaloccurrence of abnormal weather events, day-to-

to include all remaining businesses, enabling us toand electronic system performance, which in turn leads

day weather does not seem abnormal. However, it

cover more than 90% of consolidated net sales, and into the realization of Group synergies when that higher

homogeneity is the enemy of innovation.”We

would be wrong to assume this means the top priority

June 2022, Nisshinbo announced the goal of carbon

performance leads to the creation of new devices.

must cultivate an organizational culture in which all

should be placed on immediate economic concerns,

neutrality by 2050 and declared its support for the

To continue improving stakeholder value, including

employees can speak and act freely without excessive

relegating the SDGs and ESG to secondary concerns

Task Force on Climate-related Financial Disclosuresthese synergies, we will accelerate growth investments

restraint from their surroundings. However, it is wrong

to be addressed only if there is sufficient leeway to(TCFD) recommendations.

in research and development, facilities expansion andto think in terms of“accepting minorities different

do so. We must never forget that our world, wherefrom oneself.”Each person has unique individuality,

most things can be bought with money, requires awith differences that are valuable. D&I initiatives begin

sustainable global environment, stable societies andby recognizing that individuals are diverse. To lay theworld peace. Promoting business that contributes

foundations for this understanding, we need to respect

to global environmental improvements will enable

The Company is entrusted to us by its shareholders;

its business activities with the aim of becoming apeople from various backgrounds.

Nisshinbo to enhance its reputation in society andthus, we have a responsibility to handle it carefully

Company that is ever more valued and trusted by its

generate profits.

and make it better. We must improve value forstakeholders.

12

M&A, which will lead to improved ROIC and ROE.

Targeting Further Enhancement of
Stakeholder Value

With an unwavering focus on realizing a supersmart society as an Environment and Energy Company
group, Nisshinbo will contribute to society through13

Data Section

D&I initiatives are also important, as it is said
that“diversity is the source of innovation, while

Overview of Business Segments

Brakes and Chemicals) where we anticipate

making full use of bolder ideas and creating new value

How We Achieve Sustainability

ESG, Nisshinbo Group management strategies had

Special Feature

Creating Innovation with DX and D&I

Since its founding, the Nisshinbo Group has upheld

Where We’ve Come From,
Where We’re Going

As the Nisshinbo Group comprises a diverse arrayThree Strategic Business Domains
business domains targeting further growth, with the entire Group working together to drive continuous
innovations as an Environment and Energy Company group. Amid the accelerating digitization of businesses

Nisshinbo Micro Devices Connecting Everything

and services due to the impact of COVID-19, the Nisshinbo Group positions the promotion of DX as an

Background of Founding

important management strategy, thus in these three strategic business domains, the Group is expanding

In January 2022, two companies constituting the core of the Nisshinbo

the scope of business to include services providing value through the utilization of digital data based on
Nisshinbo manufacturing technologies and products. In January 2022, two core companies in the Microis under way. We will contribute to the development of a connected society
realized in these three strategic business domains through electronicGroup’s Micro Devices business, New Japan Radio Co., Ltd., and Ricoh
Electronic Devices Co., Ltd., were integrated to create Nisshinbo Micro
Devices Inc. New Japan Radio, which has developed business focused on

How We Manage Our Business

Devices business were merged and the integration of development, sales, manufacturing and other resources

Where We’ve Come From,
Where We’re Going

Nisshinbo established the three fields of Mobility, Infrastructure & Safety and Life & Healthcare as strategic

electronic devices and microwave products with analog semiconductors
at the core, and Ricoh Electronic Devices, which has developed businessdevices using our strength in analog technologies and microwave

centered on high-performance power supply ICs with CMOS analog

products with strengths in analog products.

technologies, have analog technologies at their core with almost no overlap
in terms of individual technologies, products and customers, and have

Infrastructure & Safety

Mobility

SDGs at the Core of Business Objectives

these areas. In the past, these two companies created synergies within theGroup through a cooperative system spanning purchasing to production, butnow, amid rapid expansion in the sensing market in line with the realizationof a smart society, our aim is to achieve growth and realize higher corporate
profits than ever before through the unification of these companies and theSatoru Taji
President and Representative Director

Special Feature

The Nisshinbo Group leverages the technologies andknowledge of each Group company related to disasterprevention systems such as weather radars, river waterlevel monitoring systems and total maritime information
services, providing solutions facilitating human safety
and security in a super-smart society.

achieved growth through efforts to enhance their respective strengths inNisshinbo Micro Devices Inc.

integrated use of their development, production, sales and other resources.
With demand for sensing and semiconductors expected to increase in theautomotive CASE, industrial equipment and healthcare fields, Nisshinbo

The Nisshinbo Group will integrate radar, wirelesscommunications and other proprietary technologies, while
enhancing technologies related to all moving objects onland, sea and air, including autonomous vessel navigation
and advanced driver assistance systems (ADAS), tocontribute to safety and the environment.

Micro Devices aims to become an analog solutions provider offering high

Policies Going Forward
Under the themes of promoting competitive electronic device businesses and expanding the microwave business andSDGs at the Core of Business Objectives

profit generation, Nisshinbo Micro Devices will attempt to develop highly competitive products while enhancing thequality of hardware and software with the aim of creating new solutions businesses. By refining“Connect Everything”

Life & Healthcare
As an Environment and Energy Company group,
the Nisshinbo Group promotes the development ofenvironment- and medical-related products incorporating
the technologies of each Group company.
SDGs at the Core of Business Objectives

Business Details
Electronic Devices
Semiconductor Integrated Circuits, Discrete Semiconductors, Optical Semiconductors
Providing analog solutions centered on energy management and signal processing, with core analog technologies suchas operational amplifiers and power supply ICs for in-vehicle, industrial and consumer equipment.

Microwave Products
Data Section

Satellite Communications Components, Radio Wave Sensors, Radar Components, Linear Accelerator (Linac)
Components
Realizing highly reliable, stable and long-term supplies, we contribute to various fields including radar and satellite
communications. We combine microwave technologies cultivated over many years with advanced modularization
technologies to provide product lineups that meet new market needs.
Please see“Special Feature: Value Co-creation with Stakeholders”on page 26 for details regarding Nisshinbo Micro
Devices’new solutions business.

14

Overview of Business Segments

technologies, we will grow and meet customer expectations as an analog solutions provider.

How We Achieve Sustainability

added value and new solutions under the keyword“connected.”

15

Strategic Business Domains

Mobility

Main Products and Services

The mobility domain market is expanding. In the automotive
industry, new technological innovations such as“CASE”are
advancing, as the movement toward EV and autonomous driving

Environmental Changes Surrounding the Shipping Industry■ Marine System: J-Marine Cloud

125

With the acceleration of satellite communication services for vessels andProduct trade volume

is progressing. Regarding autonomous vehicles, following Level 3,1202011‒19 performance trend forecast

which allows conditional autonomous driving, efforts are under

115

Pessimistic scenario

way around the world toward the practical application of Level110

4 services that allow autonomous driving. Furthermore, although105

the shipping industry experienced sharp declines in the firstthe advent of flat-rate plans, it has become easier to access the Internet

Baseline forecast

between vessels and land as well as various solutions effectively utilizing

Index with 2015 as 100

that information. Japan Radio collects information gathered from sea
and land from meteorological and marine information providers, land

COVID-19, signs of a recovery appeared in the second half ofcompiles databases. This enables the realization of vessel“visualization”

2020. As a means of realizing improved safety and efficiency as

90that had been difficult to achieve from land, while also contributing to

2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
2018Q3
2018Q4
2019Q1
2019Q2
2019Q3
2019Q4
2020Q1
2020Q2
2020Q3
2020Q42021Q12021Q22021Q32021Q42022Q12022Q22022Q32022Q4of next-generation autonomous vessels is progressing amid
investment in autonomous projects and growing demand for ships
equipped to monitor the conditions of surrounding vessels.

Source: WTO Global Trade Forecast, October 2021

the improvement and resolution of various problems related to vessel
navigation and operation, such as energy conservation, environmental andanti-piracy measures, and support for safe, secure and smart operational
management. Demand for these systems is expected to grow further

How We Manage Our Businessradar stations, and land AIS on the J-Marine Cloud common platform and95

well as sustainability in the marine industry, the development

Handwriting function and weather and nautical forecast overlapping function
Large touchscreen monitors connected tothe cloud provide powerful route planning support.

while at sea, creating an environment enabling the sharing of information100

half of 2020 due to a standstill in economic activities caused by

Where We’ve Come From,
Where We’re Going

Market Environment

Sharing and collection of information between sea and land
Weather and nautical information

Cloud

Handwritten information

J-Marine Cloud

Vessel operation information

Digital navigation charts

going forward as autonomous vessel navigation expands globally.

Issues and Initiatives Going Forward
as overall systems. These include traffic lights, expressways andinformation on speed, location and direction of travel, thus

other infrastructure, and wireless communications with land

they must be resilient in both rain and sunlight as well as harsh

and air for marine vessels. At sea, where we target autonomous■ Sensor Fusion (3D Authentication Technologies,
Erroneous Incursion Detection, etc.)

weather environments such as fog and snow. When consideringnavigation under harsher weather conditions than on land, we will

The Nisshinbo Group added AI functions to cameras and has beencommunications between moving objects and traffic infrastructure,

participate in external projects and dig deeper into technologies

working on systems that detect wrong-way entries on expressways

sophisticated, high-capacity communications equipment

utilizing sensors connecting to autonomous navigation services

as well as automated systems for port monitoring operations at sea.

is essential. The Nisshinbo Group goes beyond providing

using the cloud.

In addition, we use radar to monitor pedestrian traffic, facilitating safe

mechanisms, such as sensing technologies, that contribute to theMarine Business
Solutions BusinessCommunications Equipment
Business

Main customers

Production method

Solutions, systems,
devices, services

Shipbuilding companies,
shipowners,
government agencies,
public organizations

Prospects
Make-to-order

Devices, modules,
components

Nisshinbo HD 100%

Automobiles, construction
equipment manufacturers, carriers

Repeated mass
production

Indirect (personnel, procurement, etc.) andtechnological collaborative efficiency

Devices, modules,
components

Automobiles, construction
equipment manufacturers, carriers

Repeated mass
production

while the use of 4D sensing incorporating lasers has helped prevent
collision accidents in warehouses and other locations. Sensor fusion isthe combination of these different types of sensors aimed at realizing highCompletely
different
Strongcustomerdemands(Industryspecific)

functionality and performance.

Radar

Cameras(image recognition)

Raw information collected from different sensors embedded intransportation infrastructure is processed prior to fusing to improveaccuracy, which leads to the provision of highly useful solutions
Traffic signal control system

in transportation and other fields. We are already seeing practicalapplications at the technological development level and intend to engage
in concrete business developments in fields where strong demand is

Overview of Business Segments

JRC Mobility Inc.

Intersection
surveillance sensors

crossings at intersections by extending the duration of green lights,

Supply targets

Business withdrawal

Crosswalk surveillance

How We Achieve Sustainability

automation of individual moving objects. We also provide solutions

that are indispensable for autonomous driving obtain accurate

Special Feature

Sensing technologies using cameras, LiDAR, micro radar and AI

Efforts include extending green lights tofacilitate safe intersections

expected over the medium to long term.

• Business management: Specialized and integrated system ▶︎ Flexible and focused organization• Management/Decision-making: Simple process ▶︎ Quick judgments/Investment potential• Achievements and responsibilities: Clarification of Company performance ▶︎ Clarification of profitability and costs
1 Maintain independence with all functions required for the Mobility business
2 At the senior management level, promote integration and exchanges enabling JRC Mobility

to share knowledge and resources with JRC■ Automotive Brakes: Friction Materials
Nisshinbo Brake provides automobile manufacturers around the world
with optimal products according to type of vehicle used and driving
environment. In particular, Nisshinbo friction materials such as discpads and brake linings, which boast a world-leading market share, have

Value Creation Source and Strengths
By linking business segments including Wireless andthese efforts, our 3D recognition technologies have alreadyCommunications, Micro Devices, Automobile Brakes, Precision

earned a high reputation worldwide for their ability to facilitate

Instruments and Chemicals, the Nisshinbo Group combined

autonomous movement without malfunction regardless oftechnologies such as LTE (next-generation high-speed mobile

the weather. The addition of AI will enable us to incorporate

communications standard) and millimeter wave communications,predictions of movement for people and objects as we attemptwhile refining technologies related to the autonomous operationto achieve commercialization. We also aim to create solutions inof all moving objects on land, sea, air and space, beginning withareas other than vessel navigation by visualizing the ocean using

advanced driver assistance systems (ADAS: Level 2). Amongmeteorological data and marine resources.

16

Data Section

been adopted by many major auto manufacturers due to their highquality. In the United States, starting in 2021, the sale of friction material
products with a copper content of 5% or more and use in new vehicles
is prohibited, and from 2025 onward, environmental regulations will betightened to prohibit copper content of 0.5% or more. In light of thesedevelopments, Nisshinbo Brake quickly promoted the development ofcopper-reduced and copper-free friction materials that have garnered astrong reputation among automakers, with product shipments increasing
every year. The Group will maintain efforts to further increase its share inBrake pads

the friction materials market.

17Strategic Business Domains

Infrastructure & Safety
Main Products and Services
Nationwide“AMeDAS”occurrences per hour with an hourly
rainfall of 50 mm or morein the frequent occurrence of abnormal weather and natural
disasters, with the intensification of disasters such as
torrential rainstorms and landslides becoming increasingly
serious. In Japan, the number of brief but heavy rains
significantly in the past 40 to 50 years, a trend common
throughout the world. Nisshinbo Group disaster prevention
and meteorological systems are expected to continue
growing, supported by stable public demand. In addition,with regard to mobile networks, we will build on our trackrecord of private LTE (4G) overseas. In Japan, the transition
to 5G (fifth-generation mobile communications system)

grow toward local 5G. Accordingly, we anticipate dramatic

Nisshinbo weather radar is widely used in meteorological and rainfall
observation systems, including those operated by the Japan Meteorological

400

Agency and the Ministry of Land, Infrastructure, Transport and Tourism,350

as well as overseas meteorological agencies. Phased array weather radar300

combines several small radars on a plane to reduce blind spots, scans250

the entire sky in 30 seconds and observes cumulonimbus clouds threedimensionally and at high speed to quickly predict localized heavy rainfall.

200

This enables the rapid recognition of torrential rainstorms and tornadoes

150
100

Amid the rising trend of brief but heavy rainfall, demand for these services
is expected to further increase going forward, thus we will continue

0

1980

1985

1990

1995

2000

2005

2010

2015

2020

■ Disaster Prevention and Weather Services:
Pond Monitoring System
Transformation to a profitable business structure through digital businessservices. Japan Radio will increase productivity, promote
structural safety management and contribute to theBusinesstransformations

resolution of regional issues through the provision ofNew
earnings
From provider of equipment to provider of solutions
base
・IoT (systemization, digitization)
・Creating value from data (service offerings)

JRC changes and diversification

Furthermore, Nisshinbo will continue to provide highly

Traditional Biz
model

useful solutions with data collected by traffic infrastructuresensing technologies that include traffic volume

AI/IoT/Cloud

Products

measurements, wrong-way driver detection and prevention
on expressways, and the detection of anomalies on aging

Physicalhighways and other infrastructure. From the perspective

Earnings

Customer changes and diversification

Biz modeltransformation

JRC andcustomer co-creation

Services

Customer value

Earnings

Earningsof safety, while enhancing the performance of disaster

Rainfallsensors
Solar panels

system, which monitors the water level at multiple points, has a multistage
warning determination function that conducts highly accurate water level

Data collection

Communication
measures(IoT devices)Power
supplyStoragebattery
Housing BOX

Mobiletelephonebase station

Storage/processing
External
data
Information
disclosure
function

Reportingfunctionmeasurements in response to rapid rises in river water levels due totorrential rainstorms, urban disasters and river flooding. When the system
detects that the water has risen to a specified level, monitoring stations areautomatically notified. In addition, the use of wireless communications, solar
panels and long-duration storage batteries facilitate independent power
supplies, making the ability to create disaster-resistant monitoring systems
not easily impacted by power outages and disconnections a substantial
urban areas, the low power consumption design enables continuous long-

Basic water level system frameworkterm operation, including the ability to operate for more than a month even

Customer’s businessBusiness platformthat provide safety and security, including not only
weather radar covering large areas but also a large
number of reduced-cost radar units installed in small river
basins to improve hydraulic control so that local disasters

Wireless communications
and sensors

Applications

AI and analysis

Data management

Overview of Business Segmentsin the absence of sunlight. As climate change has contributed to the rise in

prevention systems, we will continue providing solutions

that are difficult to foresee can be predicted.

Water levelsensors

utilizing next-generation smart water level gauges on wireless sensor

merit. In addition to using 920 MHz, which has less interference even in

Solutions

DigitalThe Nisshinbo Group provides dam and river management systems

Monitoring equipment (cloud)

How We Achieve Sustainability

local 5G compatibility solutions connecting the inside ofstructures such as buildings and dams to private networks.

Observation equipment
Camerasensors

networks to prevent flood damage caused when rivers overflow. This

Shift to high-value-added businesses

added digital businesses that provide solutions andPond monitoring system

brief but heavy rainfall in recent years, we expect demand to increase evenfurther as a solution protecting human safety and security.

Management

Note: Create solutions with optimal platform configuration
Escape not-invented-here syndrome × partners × open innovation■ Combined Display System for Disaster Prevention:
Alertmarker+
Japan Radio provides the Alertmarker+ information mixed display systemthat visualizes and transmits area-specific messages, evacuation orders,and disaster and life support information to digital signage and a variety ofother existing displays via an HDMI cable connection. Existing displays inValue Creation Source and Strengths

municipal offices, public halls, hospitals, schools and other facilities wherea wide range of solutions in Japan and overseas, from disasterpeople gather are used to facilitate emergency broadcast distribution

sediment-related disasters, tsunamis and storm surges, Nisshinbo

prevention to disaster prevention information communication

by automatically linking to J-Alerts and disaster e-mails. The automaticGroup business segments including Wireless and Communications,systems that notify residents of dangers by combining weather

distribution of disaster information enables the rapid provision of information

Micro Devices and Chemicals collaborate to provide equipment

information with earthquake information obtained from weather

to evacuees, while automatic links reduce the workload on those sending

and systems such as water level gauges and rainfall meters, as

radar. With the advantage of strengths in leveraging Group

information. Alertmarker+ is easily installed with the addition of Alertmarker

well as the telemeters, alarms, sirens and cameras that remotelycompany technologies and knowledge, we will make use of strong

BoX, a device made by Japan Radio that connects to existing displays via an

manage them, while building dam management and other systems

relationships with government agencies cultivated up to now, andHDMI cable. As this service requires no new external connections such as

by creating a network with these devices using communicationin addition to equipment sales, we will utilize data obtained fromInternet connections to existing servers, it provides excellent cybersecurity.

technologies. In disaster prevention systems including weather

that equipment to create a variety of service solutions.

This service is increasingly used in event halls and underground shopping

18

malls in line with the spread of signage.

Data Section

To protect people from natural disasters such as river floods,

radar and river water level monitoring systems, we are developing

Special Featurebusiness of providing equipment to target high-value-radar, including quantitative precipitation conversion, which is more difficult
to observe, and particle discrimination applied to rain, snow and hail.

Source: Japan Meteorological Agency materials

Issues and Initiatives Going Forward
The Nisshinbo Group intends to shift away from the

Positional relationshipbetween radar andtornado shown in upperright black-framed inset(right image)developments aimed at the commercialization of next-generation weather（year）1975

growth in the market for private networks.

Cumulonimbus clouds
generating a tornado andtornado echo intensity (leftimage)

caused by cumulonimbus clouds that have been increasing in recent years.

50

is expected to cause the market for mobile networks(which had previously centered on public networks) to

500 Trend = 28.9 (times per 10 years)
450

How We Manage Our BusinessOccurred in 1,300 locations

with an hourly rainfall exceeding 50 mm have increased■ Disaster Prevention and Weather Services:
Phased Array Weather Radar

Internet

The effects of climate change in recent years have resulted

Where We’ve Come From,
Where We’re Going

Market Environment(In peacetime)

L-alertFacility manager
house-to-house delivery
Disaster prevention e-mail links
Emergency early warningarea-speciﬁc messages

Existing
displays(Alarm sounded)

HDMI cables
CMS and otherexisting equipment

19

Strategic Business Domains

Life & Healthcare

The markets for in-home and home-visit nursing care, seniortimes higher than in fiscal 2000 when the public nursing carefacilities, nursery school monitoring and telemedicine in regional

insurance system was started.

Core
UltrasoundTechnologies

Image processing technology for
ultrasound diagnostic equipment

Ultrasound oscillator andtransducer technologies

In addition, with the increasing risk of heat stroke due todepopulation, childbirth at older ages, the social advancement

global warming and higher temperatures driving new demandof women and other societal changes. As an example, in fiscal

for worker health management monitoring, further growth is2019, approximately 6.69 million people in Japan were certified

expected in Life & Healthcare–related markets going forward.

Piezoelectric (PZT) materials

Transducers

General-purpose ultrasound image

healthcare are expanding due to the graying of society, rural

Where We’ve Come From,
Where We’re Going

Market Environment

as requiring nursing care (in need of support), which is about 2.6

Opening(thousands of people)

8,000
7,000

RequiringsupportRequiringsupport 1

Requiring
nursing care 2

Requiringsupport 2

Requiring
nursing care 3

Requiringtransitional care

Requiring
nursing care 44,000

4,323 4,401

Porous PZT material

Requiring
nursing care 5

4,846
4,529 4,673

5,062

5,306

5,611

0.5mm

5,838

6,320
6,058 6,204

6,413 6,582

6,686

Wireless technologies

ID
transmission
Tag
DSF-214

2,983

3,000

Reader
DRF-161

Special Feature

3,445

3,839

4,086

Ultrasound image (Intravascular)

Requiring
nursing care 1

6,000
5,000

How We Manage Our Business

PZT-based ceramic material

People certified as requiring nursing care

2,562
2,000
1,000
0
2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

System to monitor people
who require nursing care
How We Achieve Sustainability（FY）

Portable ultrasound analyzer

Source: 2019 Nursing Care Insurance Business Progress Report (Annual Report); Ministry of Health, Labour and Welfare

Issues and Initiatives Going Forward
analysis equipment and the intravascular ultrasound business,

As an example, by visualizing the muscle and fat in humanthe Group will focus efforts on expanding the high-value-added

bodies, we can ascertain health conditions with the potential

portable ultrasound business and wireless technologies forfor services that provide information value leading to increased

medical use with the aim of entering and achieving growth in thehealth.

fields of prevention, prognosis, diagnosis and treatment support,

As the spread of COVID-19 has led to the rise of“remote”andas well as to strengthen our business earnings base. We intend to“contactless”needs in various fields, the Group will leverage its

develop new and valuable services and solutions in the medical

strengths in wireless communication technologies and promoteand healthcare fields.

Main Products and Services■ Wireless Technologies:“Mamotte-ne”Nursing Care Patient Monitoring System
In February 2022, Ueda Japan Radio launched sales of the“Mamottene”nursing care patient monitoring system for home use. This system
detects sleeping positions, including supine, prone and sideways, actions
before getting out of bed, including raising the upper body while lying
sideways, raising the upper body while sitting and sitting up, and risks offalling or other accidents. The system detects when a patient is gettingout of bed, sending a buzzer alert to the receiver and notifying family

Value Creation Source and Strengths
manufacturing, creating a medical business based on the pastusing a smartphone app, family members are free to customize detector

and medical-related products through collaborations amongcultivation of the world’s top-level ultrasound and wirelesssetting preferences in accordance with nursing care patient conditions.

the Wireless and Communications, Micro Devices, Precisioncommunication technologies. Proprietarily developed handheld

Through the adoption of this system, we aim to reduce falling risks

Instruments, Chemicals and Textiles business segments andultrasound devices with high-quality images manufactured andamong nursing care patients while contributing to reduced burdens

applying their respective technologies and knowledge. In terms

launched by Ueda Japan Radio in December 2020 are driving

on families who watch over patients at night. We have also preparedof medical-related products, for more than 60 years since thethe expansion of our earnings base in the Life & Healthcarea version of this service covered by nursing care insurance that can be

development of ultrasonic diagnostic equipment in 1960, Ueda

domain amid growing demand in the diagnostic field due torented by applying nursing care insurance. As the number of people

Japan Radio has contributed to the development of ultrasonic

COVID-19.

certified as requiring nursing care is expected to continue increasing in

diagnostic equipment through contract development and20

Notiﬁcation before
patient is out of bed

見守
PWR

中断
TRX

L（
1 高）

見守
PWR

ERR
L（
3 低）

見守

中断
TRX

L1（高）

見守
PWR

PAR
L（
2 中）

PWR
PAR
L2（中）

ERR
L3（低）

中断
TRX

L1（高）

PAR
L2（中）

ERR
L3（低）

中断
TRX

L（
1 高）

PAR
L（
2 中）

ERR
L（
3 低）

Sleeping

Getting out of bed[Important Point]

Notiﬁcation before anursing care patient isout of bed lowers therisk of the patient
falling down

Rush to patient

Guide to toilet

Data Section

members. In addition to being able to confirm notifications in real time

The Nisshinbo Group promotes the development of environment-

Start ofmonitoring

Family member
bedroomnursing care. While maintaining a base comprising existingand edge devices.

Nursing carepatient bedroom

product developments in the fields of medical equipment andcontinue to provide value in the monitoring market with sensors

Overview of Business Segments

As demands for monitoring increase, the Nisshinbo Group will

Japan, the need for this product is expected grow going forward.

21

Nisshinbo Group Financial Strategy

domains and will invest capital mainly in the Wireless anddependence on debt by a multiple of four. When engaging in

Communications and Micro Devices businesses. Based on

actions including the consolidation of Nanbu Plastics’s

M&A as part of our bold business portfolio reforms, we will

current depreciation costs and net operating profit after tax

overseas bases. Furthermore, in terms of measures aimed

consider how to make the best use of leverage.

(NOPAT), we will budget resource allocations of no less thanPrior to evaluating ROIC, we had been promoting business

at improving profitability, we are promoting continuous

in priority investment areas. Furthermore, in addition toindividual products. In the near future, we want to transition

The Nisshinbo Group corporate philosophy is“Change

M&A. Should single-year budgets be exceeded, we will use

to detailed performance evaluations through the full-scale

and Challenge! For the creation of the future of Earth andshort-term bank loans while considering other options.

introduction of ROIC.

People.”As climate change is one of the major threats facing

and divestment at all levels, including business units andlong-term capital, having thoroughly considered financial

semiconductor and brake friction materials businesses, initial

by climate change and appropriately responding to risks

market trends, and maintaining a balance between the long

investments are unavoidably large and asset efficiency tends

are important management issues. As part of these efforts,and short term, Nisshinbo arranged long-term bank loans

to decline. This creates barriers to entry and contributes toin fiscal 2021, the Group began analyzing climate change

as appropriate. Over the medium to long term, we willbusiness stability but tends to be disadvantageous in terms

scenarios in accordance with the Task Force on Climate-revise our fund procurement structure, and in the event ofof ROIC. At the same time, the solutions and marine systems

related Financial Disclosures (TCFD) recommendations anddecisions contributing to growth, we will approach financing

businesses that handle the wireless and communications

declared its endorsement of the TCFD in June 2022. Scenario

flexibly and consider implementation after ensuring abusinesses belong to the assembly industry, thus initial

analysis is significant in that it provided an opportunity tominimum level of safety.

investments are lower. Furthermore, we will transition

incorporate the realities of climate change into our business.

Corporate Strategy Center

The Nisshinbo Group established and conducts activities

the technologies and products we have honed throughin the three fields of Mobility, Infrastructure & Safety and Life

manufacturing. As we develop service businesses integrating& Healthcare as strategic business domains, enabling each to

The Nisshinbo Group promotes management focused

DX and IoT, we will develop asset-light businesses. In thisdefine initiatives related to climate change. The manufacturing

on ROE with the aim of realizing sustained increases inway, we want to prevent balance sheet bloating and increaseindustry must strive to reduce greenhouse gases emitted

shareholder value through the distribution of profits. We

asset efficiency. Increasing asset efficiency will naturally affectfrom production processes while responding to societal

also intend to accelerate investment in areas that drive

the streamlining of shareholders’equity on the procurement

demands in ways that lead to reduced greenhouse gases

growth, such as R&D, capital expenditures and M&A, aiming

side. We aim to achieve ROE targets by streamlining

emitted from products. Furthermore, we have a responsibility

to secure even greater support and trust from society andshareholders’equity while increasing profitability.

to introduce system technologies that protect human safety

stakeholders as an Environment and Energy Company group.

and assets from the intensification of climate change caused

In principle, there are two distributions per fiscal year:

by global warming. I believe each of these scenarios involves

the interim dividend and the year-end dividend. Targeting aboth business risks and opportunities.

consolidated payout ratio around 30%, Nisshinbo’s policy

The Nisshinbo Group promotes management emphasizing

The scale of Nisshinbo Group business is undergoing major

capital productivity while maintaining financial soundness inchanges due to business portfolio reforms based on organic

recognizes the need to be proactively involved in resource

preparation for medium- to long-term investment and risks.

growth and numerous M&A activities. In the three core

allocation when it comes to climate change efforts. In otherTo realize our return on equity (ROE) target of 12% in 2025,

segments of Wireless and Communications, Micro Devices

words, the promotion of environmental investments and R&D

to execute future growth strategies, in addition to being

we are aiming for autonomous corporate growth while

and Automobile Brakes, we have proactively engaged

contributes to the reduction of greenhouse gas emissions.

mindful of stability, our policy is to purchase our own shares

introducing return on invested capital (ROIC) as an importantin M&A. We have also transferred the paper products

Environmental investments, the utilization of renewableamong other more proactive efforts to enhance shareholderinternal management indicator.

business in consideration of its large environmental impact

energy and R&D activities are likely to cause cost increases

returns. Regarding treasury stock, in principle, shares will be

and growth potential within the Group. Through these

within short-term financial performance. We must overcome

cancelled. However, in the event of M&A projects that will

investments are mainly provided by operating cash flows, andefforts, Japan Radio, the core company in the Wireless andthese increases by devising measures such as the favorable

contribute substantially to increased shareholder value, we

we are working to improve capital efficiency by effectively

Communications business, has asset-light aspects leading

treatment of environmental investments and internal carbon

can use shares for stock swaps.

utilizing interest-bearing debt as necessary. We are also

to improved balance sheet asset efficiency. From thepricing. We intend to recoup investments through themaking efforts to ensure liquidity within the Group and reduce

perspective of flow, we acquired a semiconductor subsidiary

provision of products and services that are beneficial in

31, 2022, we plan to increase the full-year dividend per

the weighted average cost of capital (WACC) by raising andthat is now part of Nisshinbo Micro Devices and haveresolving social issues caused by climate change.

share by ¥4 to ¥34 per share (comprising an interim

managing capital Group-wide with the aim of strengthening

incorporated Micro Devices as a growth business.

Group working capital and the capital necessary for growth

Sometimes referred to as the keeper of resources, the CFO

is to provide the stable and continuous distribution ofdividends.
Furthermore, if sufficient internal reserves are available

Based on this policy, in the fiscal year ending December

From the perspective of funding, we will create a path

dividend of ¥17 and a year-end dividend of ¥17). In May, we

Meanwhile, regarding safety indicators supporting structural

toward sustainable finance efforts, such as green bonds,

announced the acquisition of treasury stock, which limits theRegarding ROIC, the WACC is set at 6% and the 2025 ROE

reforms, for the past 10 years, we have considered safety while

by organizing and promoting the Group’s environmental

number of shares to be acquired and the total acquisition

target is 12%, thus the optimum ROIC level is estimated to be

paying close attention to the EBITDA to interest-bearing debt

contribution activities in an easy-to-understand manner.

amount to 12 million shares and ¥10 billion, respectively.

approximately 8%. With a variety of businesses, the Groupratio. From the fiscal 2021 results, which saw a recovery fromestablishes the ROIC level suitable for each business and thenthe pandemic, we were able to confirm the revenue bases

strives to achieve that profit level by passing on or reducingof each business with the ratio of cash flows (net income

costs.

plus depreciation) to liabilities dropping to approximately

governance and improving the efficient use of capital.

22

Operating cash flows in the current fiscal year are expected

Financial Strategy Supporting Growth

to amount to approximately ¥50 billion, and in addition to

The Nisshinbo Group has clearly defined strategic businessstock within the scope of consolidated cash flows.

securing growth investment funds, we will acquire treasury

23

Data Section

Financial Results Over the Past 10 Years

Overview of Business Segments

Basic Financial Capital Strategy

How We Achieve Sustainability

Senior Manager of Finance, Accounting & IT Service Department of

Basic Policy Regarding Shareholder Returns

from businesses that sell products to those that utilize

Special Feature

Director and Managing Officer

Regarding capital investment, M&A investment and otherthe Earth and people, seizing business opportunities created

The key point is cultivating asset-light businesses. In the

Shuji Tsukatani

accelerating growth strategies, we want to proactively utilize

How We Manage Our BusinessClimate Change Initiatives

improvements and cost control activities as well as selection

Improving Investment Efficiency
through More Profitable
Businesses¥40 billion annually to capex and R&D investment, mainly

Where We’ve Come From,
Where We’re Going

2.7 times. This means that we should be able to increase ourselection and divestment, and in line with that policy, tookSpecial Feature

Value Co-creation with Stakeholders

Selling Systems and Equipment That Protect Ocean Safety and Security, Developing
Autonomous Vessel Operation Systems Utilizing Data

2. Scenario for Value Co-creation throughStronger Relationships with Customers
Marine Systems Performance

1. Solutions Overview

The Nisshinbo Group sells navigation equipment and bridge
systems to commercial and fishing vessels globally, with aefficiency and optimization. As the J-Marine Cloud service

large market share of more than 30% in navigation equipment

communications equipment, marine radar and other navigation

can be used in all shipping company operations, the Smartfor large commercial ships. In providing products andequipment, and bridge systems as products to commercial

Ship Viewer (SSV), which makes ships visible, and the JM-

product-based solutions, we prevent ship collisions and otherand fishing vessels globally. Furthermore, through maritime

Safety smartphone app for individual users can be used tomarine accidents while supporting global shipping industry

safety centers and numerous communications base stations

warn of approaching vessels, earthquakes, tsunamis and otherdevelopments by protecting safety and security while at sea.

located in areas where navigation is difficult, we provide

sudden changes in sea conditions, contributing to a reduction

information necessary for safe vessel operation and create

in marine accidents involving small vessels such as pleasure

Vessel Traffic Services (VTS) that centrally control navigationboats.

both in Japan and overseas.

Onshore, we also obtain real-time information on the

In addition, we operate J-Marine Cloud, which provides

OutputNavigation equipment and systems

Outcomeposition, engine, navigation equipment and surveillance images

Contributes to reducing environmental burdens by supporting safe

weather conditions obtained from weather radar and vesselof managed vessels and share information among vessels

and secure vessel operations and efficient vessel navigation

positioning information from VTS and AIS in real time online

enabling the provision of advanced operational support. The

for information analysis that enables vessel operators toutilization of data obtained through wireless communications

operate vessels safely. J-Marine NeCST, which can also betechnologies facilitating communications between vessels

linked to J-Marine Cloud, is a groundbreaking vessel operationand land is linked to the realization of autonomous navigation

support service that enables information to be handwritten

leading to the safest and most efficient routes.

in displays, contributing substantially to voyage planning

JM-Safety

J-Marine Cloud ／J-Marine NeCST
Information on other vessels
Radar information(JRC RMS)

Satellite communications

RMS

One-stop services

J-Marine Cloud

Information sharing between
ship and shore

Vessel visualization service(Smart Ship Viewer)

technologies facilitating communications between vessels and land
Sales base: Companies that operate commercial and fishingvessels globally

Unmanned Operations Leading to the
Resolution of Social Issues
Japan Radio participated in the Designing the Future of Full
Autonomous Ship (DFFAS) Consortium, comprising 30 Japanesecompanies promoting joint developments targeting the social
implementation of unmanned vessel operations using an
open innovation framework, under The Nippon Foundation

Autonomous Vessel Operation System
Developments

MEGURI2040 Fully Autonomous Ship Program. On February

Japan Radio is advancing technological developments andcenter capable of monitoring and remotely maneuvering

demonstration experiments with the aim of becoming aunmanned vessels. The SUZAKU completed an approximately

comprehensive system integrator for autonomous vessel

790-kilometer roundtrip between the Port of Tokyo and theoperation systems covering both land and sea. In terms of

Port of Tsumatsusaka (Mie Prefecture), with unmanned vessel

land-based systems, we participated in MEGURI2040, a fully

operations successfully conducted throughout the entire process,autonomous ship program conducted by The Nippon Foundation,

which lasted approximately 40 hours. This was the first time in

and we completed construction of the Fleet Operation Center

the world that a ship with a comprehensive unmanned vessel

in September 2021 to support unmanned vessel operations

operation system with remote controls, land-based support

from land. We will gather a variety of information required forand other equipment was used to conduct an unmanned vessel

navigation, including information about large ships, weather andoperation demonstration experiment in the open sea with various

sea conditions, from J-Marine Cloud to support the planning ofwatercraft moving back and forth. The realization of unmanned

optimized routes for unmanned vessels. With regard to onboard

vessel operations will lead to safe vessel navigation andsystems, through joint research and development with Kawasaki

contribute to reducing maritime accidents and crew shortages,

Kisen Kaisha, Ltd., and YDK Technologies Co., Ltd., we arewhich, in the future, will result in increased cargo handling andpromoting the development of technologies such as AI imagetransport efficiencies, as well as the development of new methods

recognition, sensor fusion, risk determination and the generationof transportation for remote islands and metropolitan areas.

26, 2022, the container ship SUZAKU was used to conduct
a demonstration experiment incorporating a land supportof safe routes that will automatically avoid collisions with othervessels, which is essential for realizing autonomous vessel

Collision prediction warning,
Guard zone monitoring

Vessel position, measurement data,
equipment status, AIS, radar, planned

Digital sea charts
Meteorological and sea

Meteorologicalroute, VTS information

accidents are caused by human error, we will prevent maritime
accidents while contributing to the development of the shippingand sea conditionindustry, which faces challenges that include labor shortages andinformation

condition information

operations. As it is said that approximately 80% of maritime

targeting full-scale commercialization of an autonomous vessel

Customers

operation system in 2025.

■ Collision/approach prediction

Output■ Alarm notification■ Weather information
AIS： Automatic Identification System VTS： Vessel Traffic Services

24

Data Section

aging crews. We will proceed with demonstration experiments■ Earthquake/tsunami news flash

Administrative vessels

Overview of Business Segments

Remote Maintenance System

Technological capabilities: Wireless and communications

How We Achieve Sustainability

Smartphone app

development and global sales

Special Feature

onto electronic navigation charts (ENCs) on large built-

Human resources: Human resources responsible for research andHow We Manage Our Business

The Nisshinbo Group provides marine wirelessMain Capital

Where We’ve Come From,
Where We’re Going

Marine Systems Supporting Global Shipping Developments

Autonomous vessel operation system
Navigation
planning

OutcomeContributes to shipping industry developments

IKOUS Corporation, container ship SUZAKU (Image provided by The Nippon Foundation)

25

Special Feature

Value Co-creation with Stakeholders

Nisshinbo Micro Devices Customer Relations Enhancement Strategy

2. Scenario for Value Co-creation through Stronger Relationships with Customers

The demand for communications infrastructure and other

Example of Strengthening Relationships withMajor Customers ① (In-vehicle)

Output

The automobile industry is experiencing technological

Outcomeinnovations in new areas represented by CASE. With regard

Increased productivity and safety, highly efficient electric power

Nisshinbo Micro Devices has expanded its customer baseelectronic devices due to the acceleration of DX and thecentered on major global companies representing eachadvent of IoT and a smart society amid the trend toward a

industry in the fields of in-vehicle, industrial equipment andglobal digital shift is expected to continue growing over the

consumer equipment. By further strengthening relationships

medium to long term. Given these conditions, Nisshinbo Microwith major players in these markets, we will capture demand

Devices Inc., which was established in January 2022 with thein each market, leading to business expansion. The current

integration of New Japan Radio Co., Ltd., and Ricoh Electronic

breakdown by sales in each market is shown in the following

Devices Co., Ltd., is expanding its competitive productgraph. We will maintain the consumer business while targeting

portfolio while incorporating AI and digital technologies into its

growth in the in-vehicle and industrial machinery businesses.

strengths in analog technologies with the aim of becoming an

toward the practical implementation of Level 4 services
enabling unmanned driving are spreading throughout theworld. Given these conditions, by linking business segments

Nisshinbo Group is working to contribute to safety and the

In-vehicle

Main Capital
Human resources: Engineers who make full use of analog
technologies, serving as a bridge between AI and accurate
information
Technological capabilities: Mounting technologies expansion fromstand-alone IC technologies to modules
Customer base: Trading performance with numerous major global
companies representing their industry in the in-vehicle, industrial
machinery and consumer markets

environment by refining technologies related to autonomous
driving, including advanced driver assistance systems (ADAS:
Level 2 autonomous driving). Nisshinbo Micro Devices is cocreating with major domestic and overseas automobile parts

How We Achieve Sustainability

Major automotive-relatedcompanies within and outsideJapan

Major manufacturers in awide range of industries
within and outside Japan

PMIC, sensors and AFE

manufacturers while developing application-specific integrated
circuits (ASICs) for automobiles.

OutputASIC deployment for power management and sensor signal
processing for specific customers

OutcomeExample of Strengthening Relationships withMajor Customers ② (Industrial machinery)

Outlook by Market

At manufacturing sites, the introduction of industrial equipment

In 2022, despite sluggish growth in theElectronic Device Business: Sales by Market

consumer market due to an abatement in

90,000pandemic-related stay-at-home demand, in
the in-vehicle market, global automobile sales
are expected to grow more than 6% year on

80,000ConsumerIndustrial machinery

such as industrial robots and machine tools is advancing
automation and efficiency in manufacturing processes.

In-vehicle

CAGR

global shipment volumes in core segments are

50,000expected to grow 5% year on year.

40,000

10.0%

globally amid intensifying price competition and rising production
8.6%

costs. Until now, Nisshinbo Micro Devices has established a
track record of handling a large number of prominent customers
worldwide, thus we will strive to expand the scale of our

30,000business by increasing the number of registered products among

20,000

4.1%

10,000

customers and deploying them horizontally. To this end, we will
strengthen relationships with industrial equipment manufacturers

0(CY)

developed countries, but now factory automation is expanding
Data Section

year, while in the industrial machinery market,

Automation had been implemented using industrial equipmentin the automobile and mobile equipment industries mainly inMarket axis

70,00060,00026

Overview of Business Segments

Traffic safety and highly efficient electric power with ADAS

Nisshinbo Micro Devices Inc.

2021

Special Feature

Automobile Brakes, Precision Instruments and Chemicals, theIndustrial
machinery

Major high-tech companies
within and outside Japan

which enables conditional autonomous driving, while efforts

including Wireless and Communications, Micro Devices,

analog solutions provider offering unprecedented new value.

Consumer

to autonomous driving, bans have been lifted on Level 3,

How We Manage Our Business

1. Enhance Customer Relationships as an Analog Solutions Provider

Where We’ve Come From,
Where We’re Going

Aiming to Become an Analog Solutions Provider Relied on
by Customers throughout the World

2022

2023

2024

and meet diverse needs including enhanced safety, energy
efficiency, noise resistance and reliability.

27

How We Achieve Sustainability ̶ ESG Initiatives

With its corporate philosophy“Change and Challenge! For the creation of the future of Earth andMateriality and Related Major Risks, Opportunities and Responses
ESG

Materiality

People,”the Nisshinbo Group has since its founding inherited the basic spirit of corporate public

Major risks andopportunities

In February 2015, we identified material issues for the Group in order to clarify issues that required
action to achieve sustainable growth for the Nisshinbo Group’s business together with society.

2. Prioritize social issues

3. Deliberate and approve at the
Corporate Strategy ConferenceFirst, we identified social issues,

During Group CSR Council

The Corporate Strategy Conference,referring to ISO26000, the fourth

deliberations, we prioritized thechaired by the president ofedition of the GRI Guidelines,

social issues we had identified

Nisshinbo Holdings and comprising

the 10 principles of the UN

from the perspective of their

all managing officers, deliberated the

Global Compact and other social

importance to stakeholders andissues’materiality. After considering

norms. We then evaluated their

their importance to the Nisshinbo

the importance of these social issues

relationship to the Group’sGroup, coming up with a draft

and their relationship to the Group’sbusinesses and identified 22 social

proposal.

businesses, we determined the threematerial issues indicated below.

Creation of asafe andsecure society

G Corporate Governance

Creation of a safe andsecure society• Encourage HD and Group companies to work together
to roll out high-level health and safety approaches fromJapan to sites worldwide－

Quality• Loss of trust, claims fordamages or product recalls
due to quality issues ordefects with products orservices• Use the risk management system to minimize risk
probability and potential impact• Establish a quality assurance team at HD to oversee
quality assurance and product safety activities at Group
companies• Management issues due togreater business diversity• Large number of duplicate
functions among Groupbusinesses• Harness the Group’sdiverse strengths by
integrating businesses/organizations to drive
innovation and increase
resilience to changes in theoperating environment• Reform the business portfolio to align with changes inissues faced by society; improve cash flow
• Improve efficiency by overhauling Group-wideorganizations and outsourcing• Maintain Group integration by consolidating theoversight of Group company management at HD andestablishing financial discipline• Increasing complacency ingovernance• Take risks based on abalance between proactive
and defensive governance• Build on pioneering steps such as the introduction of
the outside director system in 2006, the adoption of theHD system in 2009 and the termination of the advisor/
consultant system in 2017; establish an advanced
governance system that balances managementtransparency with bold risk-taking• Loss of trust and damage
to corporate value causedby legal violations suchas corruption or anticompetitive practices, orby corporate behavior thatdiverges from social norms－• Employ messaging from the president of HD tounderscore the importance of fair business practices• Provide continuous compliance training• Impose severe penalties for misconduct• Appoint outside directors with legal background

Compliance

Fraud/illegal
conduct

SDGs with Close Links to the Nisshinbo Group’s Businesses
6. Clean water and sanitation
Ensure availability andsustainable management ofwater and sanitation for all

28

9. Industry, innovation and infrastructure
Build resilient infrastructure, promote
inclusive and sustainable industrialization,and foster innovation

12. Responsible consumption
and production
Ensure sustainableconsumption and production
patterns

13. Climate action
Take urgent action tocombat climate change
and its impacts

Information
security• Financial window-dressing,－accounting irregularities, etc.
• Unauthorized disclosureof personal information,customer information ortrade secrets• Information leaks or data
corruption caused bycomputer viruses－

Data Section

Organizational
GovernanceFair Operating Practices

Global compliance• Impact on business of failure －to ensure employee healthand safety worldwide

Businessmanagement

Globalcompliance• Use RPA, IoT and other tools to increase automation• Promote the overlap
and realize labor savings
between the Corporate
Philosophy and the growing • Implement strategic PR activities to improve thecorporate visibility and image
interest in ESG among
younger people, leading to • Provide human resources and financial support to joint
research projects with academia
more hiring opportunities• Use targeted local recruitment activities

Occupational
injuriesGroupmanagement

Environment

Human Rights
Labor Practices
Consumer Issues
Community Involvement
and Development• Establish a human rights group and a diversity
development department at HD to maintain and raiseawareness across the Group• For segments that fall under the conflict minerals issues,
investigate usage and report that to our stakeholders

Human
resources

ISO26000

G: Corporate Governance

S Social Initiatives

Contribution to theenvironmental and energy
field－• Widespread sexual andpower harassment that
undermines the working
environment• Human rights abuses in the
supply chain

Overview of Business Segments

E Environmental Initiatives

SDGs

Responses to Risks:• Develop a business continuity plan (BCP) based on theassumption of major natural disasters; conduct training to
improve the Group’s response to the risk of business disruption• Take steps to reduce CO2 emissions• Introduce SOx/NOx removal equipment• Increase the sales ratio for“products that contribute to
the creation of a sustainable society”to 70% by 2030
Responses to Opportunities:• Improve technological capabilities for developing fuelcell parts and materials• Increase production capacity and strengthen sales formarine wireless communication equipment to address therising demand for new biomass fuel transportation vessels• Sell water/river management systems, weather radarand other disaster prevention/mitigation solutions
developed in Japan to customers overseas• Conduct climate change scenario analyses according to
the Task Force on Climate-related Financial Disclosures(TCFD) recommendations; identify climate change risks
and opportunities facing the Group in the future andutilize them in formulating business strategies• Difficulties hiring andretaining talented people

Relationship between Materiality and Global Guidelines
Materiality• Address the greater• Impact on supply chainsdemand for fuel cellfrom major natural disasters
vehicles as the hydrogencaused by extreme weather
society gains momentum• CO2 emission costs due to• Grow the number of new
introduction of carbon tax
ships built amid rising• Costs to reduce CO2
demand for biomass fuelemissionstransportation• Costs to respond to tighter
rules on SOx/NOx emissions • Expand businesses
that provide disasterworldwide
prevention/mitigation• Impact on business activities
solutions to address risingfrom tighter rules onwind and flood damage
greenhouse gas emissions

How We Achieve Sustainability

issues for consideration.

Human rights

Responses to risks and opportunities

Special Feature

1. Identify social issues forconsideration

Contribution to the
Climateenvironmental
changeand energy
field

Opportunities

How We Manage Our Business

Process of Determining Materiality

S: Social Initiatives

thoughts on corporate management and proactively pursuing ESG initiatives.

E: Environmental Initiatives

institutions of contributing to society through business activities. We are placing ESG at the heart of our

Risks

Where We’ve Come From,
Where We’re Going

ESG Initiatives — Materiality, Risks and Opportunities• Use the internal control system and the corporate
ethics reporting system to prevent misconduct• Employ regular rotation to prevent misconduct• Conduct continuous training and annual internal audits
to assess information security• Use the risk management system to minimize risk
probability and potential impact

For risks related to business, please see pages 22–24 of the 179th Securities Report.

29

How We Achieve Sustainability ̶ Nisshinbo Group Human Resources Strategy

Business is people―Business success or failure depends on human
intelligence and virtue －(1) With regard to human resources able tocontribute to the development of business(2) Recruit, train and place people in the rightjob,

Executive Managing Officer
Senior Manager of Sustainability Development Department
and Human Resources and Administration Service Department,
Corporate Strategy Center

How does the Nisshinbo Group view its
human resources?

business leaders”who can take on challenges and achieve
answers as globally competitive leaders. Second, we pursue

and generating appropriate earnings through creation and

What measures have been implemented
since formulating the Group humanresources strategy?

In 2020, we introduced a talent management system aimed at
visualizing the skills, capabilities and experience possessed byeach employee. This system is used to identify and promote
human resources to place the right people in the right jobs.
Furthermore, in April 2021, we launched a learning management
system providing employees at all Group companies an equal
opportunity to receive extensive education. These efforts haveposition candidates.

of strengthening and driving commercialization, profitability
transformation. Third, we look for“general employees”who,in response to major trends in technological changes such as
digitization, must be able to achieve operational efficiencies
and productivity improvements. From these ranks, we expect
to cultivate human resources who will become candidates
for leading future transformations. We are also proactively
developing education, training and other programs to deepen
each class, such as the senior management candidate training
program launched in 2015, which has already been successful
in producing many of the executives currently holding
management positions. Furthermore, we conduct Group-wide
workshops and provide innovation leader training for younger
employees to increase the number of senior management
candidates in reserve. Nisshinbo does not believe it possible
to develop human resources through on-the-job training
alone, thus we will continue to proactively invest in humanＱ

respective business areas. With more than 20,000 employees
worldwide, we formulated a Group human resources strategy
in 2020 to ensure employees from these diverse backgrounds

What do you prioritize from the perspectiveof securing new human resources?

In addition to these mechanisms supporting human resource

development, we will recruit a wide variety of humanmanagement, we have dramatically increased opportunities

resources, including, but not limited to, new graduates, placing

for the sharing of human resource–related policies and issues

the right people in the right jobs and providing training.

across the Group. Group Human Resources Department

As employee engagement is also important for eliciting

meetings are not limited to core companies; human resource

enthusiasm and creativity, we must take health management

managers from approximately 30 companies attend each

into consideration and create an environment in which skilled

meeting. Rather than imposing the policies of the holding

people are treated appropriately.

company, we respect the various methods employed by Groupsystems for the ongoing recruitment and training of highly
specialized human resources with digital skills able to realize
management policies and business strategies. As we also
believe that the source of innovation lies in human resource
diversity, we are focusing on developing and promoting
diversity within human resources, including female managers
and foreign national employees.
In terms of global human resource development, to expand
the number of candidates for senior management positions,which currently is open only to candidates in Japan, we want
to expand participation to include overseas candidates. In
China, we are developing a simplified version of the three-tiered
education system employed in Japan, targeting approximately
1,600 Group employees from more than 20 companies across
China centered on our base in Shanghai. These efforts havebeen well received by local Group employees, so we want
to expand them to Indonesia and Thailand in the future. We
will also continue to proactively hire and train foreign national
employees in Japan. Although some employees we hire mightleave their jobs, we believe that the provision of opportunities
to return to work for Nisshinbo and play an active role will
also lead to the expansion of diversity. In a diverse workplace,
employees frequently encourage and learn from each other,and my personal sense is that diversity creates tremendous
value in terms of invigorating human resources. I believe it
is important to maintain friendly relationships with former
employees, both Japanese and non-Japanese, who have left
Nisshinbo for new challenges while providing opportunities forconsequently, the enhancement of corporate value.

level as new graduate hires and promoting the creation of anenvironment in which talented mid-career hires with various
experiences from a variety of backgrounds can make a softlanding in the Nisshinbo Group. In terms of systems, wecreated new positions with limited regional responsibilities.
Regarding corporate culture, we are focused on diversity andinclusion that recognizes and respects differences and benefits
from mutual strengths while ensuring psychological safety. It
is also helpful to tolerate any friction caused by these culturaldifferences. In April each year, mid-career hires in their first yearＱ

In closing, do you have a message for
Nisshinbo stakeholders?

For human resources to fully demonstrate their capabilities,
job satisfaction is a critical underlying factor in an environmentthat guarantees psychological safety. Rather than mechanisms,
systems and compensation, the primary driver of job
satisfaction is empathy for the direction of the organizationand its business. As the Nisshinbo Group develops a wide
range of businesses, we believe that attracting a diverse
array of human resources and strengthening unity within thatdiversity will lead to Group growth and the realization of our
objectives.

31

Data Section

or failure depends on human intelligence and virtue.”Under

distribution within human resources, we must enhancethem to return, as that will lead to strengthening diversity, andwe are increasing the number of mid-career hires to the same
The“L-Click”cloud-based learning management system (LMS) with e-learningand administrative functions

In addition to addressing the unbalanced generational

to past business trends, the human resource generation
this situation to compete globally in the future. To this end,

can fully demonstrate their capabilities. The essence of thisWhat issues have you identified in terms ofpromoting this human resource strategy?

Having adjusted the number of new graduates hired in response
distribution has become unbalanced. We must quickly rectify

are aligned with the direction of the Nisshinbo Group andＱ

Overview of Business Segments

resource developments.

and cultures, each of which possesses strengths in their30

The Group categorizes human resources into threeand function.

variety of companies with different histories, backgrounds

this human resources policy, with a focus on future business

What is required of Nisshinbo humanresources and what are your training policies?

“managers and managerial candidates”who must be capablein amicable M&A. Accordingly, the Group now comprises athat“business is people;”in other words,“business success

Ｑ

Provide ongoing training and allocate people

The Nisshinbo Group has achieved growth while engaging

policy can be summarized by Nisshinbo’s conventional viewequal, from small companies to the holding company.

(5) Evaluate employees fairly and treat them

led to an increased number of female managers and managerialＱ

perspective of the mid-career hires.

changes that include requests that personnel systems be madeHow We Achieve Sustainability

Makoto Sugiyama

issues are also provided to management as feedback from theincluding employees posted overseas. This has given rise toSpecial Feature

Principle“Business is People”

restrictions on geographical location or number of people,

transformation in an opaque and uncertain era with no correct

generating appropriate earnings at each level

Unity in Diversity under the Basic

identify issues in need of Nisshinbo Group improvement. These

classes. First, we seek“senior management and future

appropriately, andＱ

new graduates. After training, a roundtable discussion is held topandemic, with people communicating on equal levels without(3) Encourage enthusiasm and creativity,(4) Maintain physical and mental health,Realizing Our Vision throughof employment also participate in group training conducted forGroup objective. Online meetings have advanced during the

How We Manage Our Business

now and in the future, Nisshinbo willcompanies and aim to align them more closely with a single

Where We’ve Come From,
Where We’re Going

Nisshinbo Group Human Resources Strategy— Nisshinbo Group Human Resources Policy —How We Achieve Sustainability ̶ Creation of a Safe and Secure Society

Basic Stance
Each and every employee’s ability is key for companies to contribute sustainably to a diverse and global society. We aim tocreate a more worker-friendly environment by respecting the character and individuality of each employee and placing theAssisting Workers in Balancing Work and Nursing Care

Occupational Injuries

Each Group company in Japan has introduced several programs

In fiscal 2021, there were no instances of major workplace accidents

to help employees balance work and nursing care. These include(accidents with Level 7 or higher injuries). The frequency of occupational

nursing-care leave, family-care leave, shortened working hours for

accidents with lost workdays* at the Group’s domestic business sites

family care and a system for returning employees to work after

was 0.16, an improvement from 0.50 in fiscal 2020.

retirement for nursing care.

*Frequency of injuries with lost workdays = number of employees injured

right people in the right jobs. To this end, we respect diversity in all respects, including human rights and hiring, and promote awork-life balance. In addition, we carry out safety and occupational health activities with the aim of eliminating all occupational

Human Resources Training
The Nisshinbo Group has built a systemized training frameworkwith several components. The framework includes courses
designed for different groups, such as new recruits and people
newly appointed to mid-level manager, section head anddivision head positions; courses to acquire specific skills; general
study courses covering topics such as career training, safety,
human rights and the environment; and specialist courses ontechnologies, accounting, intellectual property and other topics
program for employees earmarked to become senior managers.
The program is designed to foster approaches, knowledge andbehavior for their future senior manager roles before they arepromoted.“Innovation Leader Development Training”is provided
for young and mid-career employees. In April 2021, we introduced
a learning management system nicknamed“L-Click”to encourage
and equalizing educational opportunities.

Promotion Activities for Diversity & Inclusion
The Nisshinbo Group promotes diversity and inclusion (D&I)
activities aimed at“cultivating an organizational culture thatempowers employees to speak freely without hesitation and takeaction.”Having established the milestone of achieving a“workplacein which diverse people are active”by 2025, Nisshinbo conducts
Japan. Since 2021, the Group has conducted“Psychological Safety:
Achieving Results through D&I”training sessions for employees
at each level with the aim of inculcating an understanding of theimportance of“psychological safety,”a foundational concept of D&I.

Engaging People with Disabilities as Valuable Assets
As of December 31, 2021, JRC Tokki Co., Ltd., employed 10
people with disabilities (2.6% employment rate). These employees
play active roles in a wide range of departments, including
general affairs, accounting, procurement, quality assurance andmanagement, where they are exclusively assigned based on their
independence of individuals, we create an environment in which
everyone is highly motivated to engage in work as a unified force.

Empowering Women
Based on the Act on Promotion of Women’s Participation andAdvancement in the Workplace, Nisshinbo Holdings Inc. hasformulated the following“General Action Plans”to ensure thatdiverse human resources, including women, can work energetically32

To promote respect for human rights and put in place a more

0.3

comfortable workplace, the Nisshinbo Group engages in human

0.0

rights education and training activities based on a structure in

Goal 1: The proportion of females in the total number of clericalwhich Nisshinbo Holdings Inc.’s Chief of the Corporate Strategy

Measure: January 2022-: Public relations on efforts to promote

Sustainability Development Department serves as the Promotion

professionals is to be more than fifty percent.

women's active participation, diversity, and inclusion.

Goal 2: The number of women in supervisory roles will be more than
twice as many as that in fiscal year 2021.

Measure: January 2022-: Interviews with supervisors for positive andfair development and the evaluation of female employees

Development of an individual development plan for female
employees and follow-up on implementation status

Creation of opportunities for exchange between female employees

Center serves as the Promotion Committee Chair and Chief of theCommittee Vice-Chair.
Throughout the year, we provide training for newly hired
employees and overall training for all employees.
In addition, the“Nisshinbo Group Sustainable Procurement
Basic Policy”and“Sustainable Procurement Guidelines”usedby Group companies clearly indicate our consideration for basic
human rights and the prohibition of child labor, as well as thoroughand managers and supporting network formation

respect for human rights throughout the supply chain.

Goal 3: Take at least 70% of annual paid leave.

Safety and Health Activities

Measure: January 2022-: Management and follow-up of leave status* Japan Radio Co., Ltd., Nagano Japan Radio Co., Ltd., Ueda Japan Radio Co., Ltd.,JRC Tokki Co., Ltd., JRC Engineering Co., Ltd., JRC System Services Co., Ltd., Nagano
Japan Radio Manufacturing Co., Ltd., Nisshinbo Micro Devices Inc., Nisshinbo Micro
Devices AT Co., Ltd., Nisshinbo Micro Devices Fukuoka Co., Ltd., Nisshinbo Brake
Inc., Nisshinbo Mechatronics Inc., Nanbu Plastics Co., Ltd., Kyushu Nanbu Plastics Co.,
Ltd., Nisshinbo Chemical Inc., Nisshinbo Textile Inc., Tokyo Shirts Co., Ltd.

Work-Style Reforms
In 2020, beyond promoting the active participation of a diverse
range of human resources, each Group company in Japan
instituted a telework system to facilitate more comfortable work
environments. Currently, we are advancing a variety of activities
based on the Action Plan for Workstyle Reforms, which wasannounced in January 2021.

The Action Plan for Workstyle Reforms(January 1, 2021, to December 31, 2024)

1. Rectify long working hours

Reduce the number of employees who work more than 45 hours
a month of overtime by 20% compared with fiscal 2020.

2. Encourage the use of annual paid leave

Maintain an annual paid vacation rate of at least 70%.

3. Promote flexible work styles(1) We will review systems that correspond to a variety of work styles.
(2) Develop an environment that makes it easier for male
employees to take childcare leave, etc.

The Nisshinbo Group shares the Business Conduct Guidelines“Safety Is the Basis for Everything”with all employees andpromotes health and safety activities with the aim of maintaining
and improving safe and supportive working environments at all
business sites within and outside Japan.
To extend the record of zero major workplace accidents
achieved in fiscal 2021, we focused on initiatives such as ongoingrisk assessments (work, equipment, chemical substances) and theimplementation of priority measures for serious risks; the early
detection and elimination of unsafe conditions via comprehensive
workplace patrols and the correction of unsafe behaviors as preventive
safety activities; the thorough implementation of“stop-call-wait”whentrouble occurs in parallel with equipment safety devices and otherimprovements; thorough safety confirmations before maintenancework; efforts to prevent falls with a focus on older employees as afalling countermeasure; and enhanced safety education for unskilled
persons including temporary employees to improve risk sensitivity.
These policies were implemented at all Group companies.
Each business office enhances each employee’s safetyawareness by conducting small group activities (e.g., training
when work details change, skill-improving education, horizontal
development of occupational accidents within the Group, danger
awareness training and 5S activities) in addition to trainings for
new hires and for employees changing work content. It alsosystematically conducts risk assessments (of equipment, work andchemical substances) according to an annual plan to prioritize therisks to be addressed and take preventive safety measures.

0.6

18.3

18.12

19.12

20.12

21.12

Health and Safety Audits
The Nisshinbo Group conducts regular occupational healthand safety audits of its manufacturing sites. A monitoring teamcomposed of the Health & Safety Group from Nisshinbo Holdings
Inc., labor unions, safety and health management staff representing
each business, and health and safety officers from other businesssites checks the state of health and safety management at thetargeted business sites. In fiscal 2021, we conducted audits at 44
manufacturing sites in Japan and one manufacturing site overseas.
In response to the spread of COVID-19 infections, onsite audits
were conducted after implementing infection control measures inJapan, while online document audits were conducted overseas.
At the end of each fiscal year, the results of all audits andchecks are compiled in a comprehensive audit report, which isused to analyze potential risks and communicate good practices tothe whole Group as part of workplace health and safety activities
in the following fiscal year.

Health Management
The Nisshinbo Group’s Health Management Policy states that the“Nisshinbo Group, through the establishment of an environment
where each individual member can play an active role by promoting
employee health and sound workplace, aims to be a corporategroup which is indispensable, at any time, for our society.”To
promote health management efforts across the Group, Nisshinbo
established the Group Health Management Department Meeting,which is attended by health management department leaders fromeach Group company and is tasked with coordinating the Group’sactivities. Specifically, the meeting focuses on activities in three key
areasーpersonal health, organizational health and safety awarenessーto ensure all employees are fully aware of their safety obligations.
In fiscal 2021, to promote“individual health,”“participationin walking events”and“organizational health,”with regard tomaintaining the average overall health risk value of stress checks
below 100, reducing the number of companies with stress checks
above 100 and“reliably meeting safety consideration obligations,”
starting in fiscal 2022, Nisshinbo decided to create a healthmanagement report based on employment guidelines and healthcheck items under the Industrial Safety and Health Act.

For more information, please see the Sustainability section of the Nisshinbo Group website.
https://www.nisshinbo.co.jp/english/csr/index.html

33

Data Section

individual (or respective) aptitudes. Furthermore, in respecting theimplemented by 17 Group companies* in Japan.

Overview of Business Segments

D&I promotion activities across the Group within and outside

Respect for Human Rights

General Action Plans

Average for Japanese manufacturing industry

0.9

and maximize their abilities. Similar measures are being(Planning period: January 1, 2022, to March 31, 2026)

Nisshinbo Group (Japan)

1.2

How We Achieve Sustainability

the active participation of diverse human resources by expanding

1.5

Special Feature

related to specific businesses and functions. We also run a special

Frequency of Injuries with Lost Workdays

How We Manage Our Businesshazards.

The“Tomonin”logo. This logo is used to promote
work environments where employees can balance
work and nursing care.

with lost work ÷ aggregate number of working hours × 1 million

Where We’ve Come From,
Where We’re Going

Creation of a Safe and Secure SocietyHow We Achieve Sustainability ̶ Contribution to the Environmental and Energy Field

Reports Based on the TCFD Recommendations

Basic Stance

Overview of the TCFD Response

Strategy

The Nisshinbo Group is aiming to increase corporate value as a more united corporate group by realizing its Corporate Philosophy,

Climate change is a global issue that transcends nations andOverview“Change and Challenge! For the creation of the future of Earth and People.”As an Environment and Energy Company group, we
will continue to offer new products and systems that help protect the environment, save energy and create alternative sources ofenergy, while also providing solutions that address some of the greatest issues faced by humanity today, such as environmental
destruction and natural disasters caused by climate change, to make life safer and more secure for people everywhere.

As the Nisshinbo Group is engaged in a wide range of businesses,

regions, making the reduction of greenhouse gases a shared

we first conducted climate change scenario analyses using

global long-term objective. Believing it important to seize

the following steps to target businesses we anticipate will bebusiness opportunities created by climate change and respondsignificantly affected by risks and opportunities, including theappropriately to risks, in fiscal 2021, the Nisshinbo Group began

Solutions business within the Wireless and Communications

conducting climate change scenario analyses in accordance with

Long-Term Environmental Target (to fiscal 2050)
Aim to be Carbon Neutral

them in the formulation of business strategies, we will devise

Two climate change scenarios were used, one based on a worldin which warming continues (warming progression scenario:

climate change will pose to the Group in the future, then utilizing

2.6℃ –4℃ scenario) and the other a world in which warming
is curtailed and a positive shift is under way (decarbonization

more flexible and robust strategies and increase resilience against

Medium-Term Environmental Target (to fiscal 2030)of the TCFD recommendations.

Primary targets

Provide sustainable solutions
Increase ratio of products that
contribute to a sustainable society

70％ or more of total sales

Global warming countermeasures
Reduce greenhouse gas emissions*1
by

50％ or more comparedto fiscal 2014

Water resource
countermeasures

Contribute to the realizationof a recycling society

Reduce water usage per unitof salesImprove the recycling ratio
to95％ or more

by

70％ or more comparedto fiscal 2014

*1 To target the long-term environmental goal of carbon neutrality by fiscal 2050, the short- and medium-term environmental targets for greenhouse gas emission reduction items were revised.

Previous Three-Year Environmental Targets and Results (2019–2021),
New Three-Year Environmental Targets (2022–2024)

The Nisshinbo Group established and now operates a governancesystem within the Group-wide governance system*1 toappropriately respond to risks and opportunities related to climatechange. Responsibility for climate-related issues is entrusted to

Improvement of the sales percentage
by the products that contribute to thedevelopment of the sustainable society

55% or more of total sales

52% of total sales

60% or more of total sales

Reduction of greenhouse gas
emissions per unit of sales

Reduce by 10% or morecompared to fiscal 2014

Reduced 14%
compared to fiscal 2014―

Reduction of greenhouse gas
emissions――

Reduce by 35% or morecompared to fiscal 2014

Reinforcement of the maintenance of
biodiversity

Implement at more than 5 overseas sites

Implemented at 5 sites overseas

Activities in Japan and abroad
At more than 5 new sites

Reduction of water usage per unit ofsales

Reduce by 3% or morecompared to fiscal 2017

Reduced 33%
compared to fiscal 2017

Reduce by 65% or morecompared to fiscal 2014

Promote Life Cycle Assessment (LCA)*

50% or more of total sales

57% of total sales

60% or more of total sales

Reduction of the energy consumption
per unit of sales

Reduce by 10% or morecompared to fiscal 2014

Reduced 9%compared to fiscal 2014

Reduce by 15% or morecompared to fiscal 2014

Reduction of the volume of PRTR*2
substances emissions per unit of sales

Reduce by 10% or morecompared to fiscal 2017

Reduced 10%
compared to fiscal 2017

Reduce by 30% or morecompared to fiscal 2014

Increase the recycling rate to 90% or more

88% recycling rate

Increase the recycling rate to 90% or more

*1 Life cycle assessment (LCA): Understanding of environmental load, through the life cycle of a product, from raw materials to production, use and finally to disposal.
*2 PRTR substances: Substances subject to the Pollutant Release and Transfer Register (PRTR) system pursuant to the“Act on the Confirmation, etc., of Release Amounts of Specific Chemical
Substances in the Environment and Promotion of Improvements to the Management Thereof”for which reports of their amounts of release and transfer must be filed.

Chemicals

the president and executive officers, which reports to the Board

Analysisof Directors, who discuss responses to reported climate-related

1 Assess materiality of climate-related risks

Steps of Climate Scenario
Analysis

Important risks and opportunities were identified for each of the three targeted businesses. As the impacts of climate change have thepotential to arise in the medium to long term, risks and opportunities were qualitatively evaluated as“large,”“medium”or“small”on shortterm as well as medium- to long-term timelines leading up to 2050. As a result, we extracted risks and opportunities of high importance
related to the survival of the business and the creation of new businesses in the Solutions business within the Wireless and Communications
business and the Automobile Brakes and Chemicals businesses, as shown in the table below.
Assessment Item
Risk type
Major categories Subcategories

Policy andLegal

Market andTransition
Technology
risks
ShiftsWireless andCommunications*1

Carbon price

Automobile
Chemicals
Brakes●Energy mix

Reputation

Customerpreferences

Chronic

Precipitation,
Weatherpatterns

Acute

Severity of
extremeweather
events●●●●For more detailed information, please visit the Sustainability section of the Nisshinbo Group website.
https://www.nisshinbo.co.jp/english/csr/index.html

34

Physical
risks

Risks

Opportunities

Automobile Brakes
Chemicals
Taxing emissions by introducing acarbon tax

Automobile Brakes
Increase in sales of brake friction materials due tochange in demand for automobiles
Chemicals
Increase in sales of cross-linking agents due torising demand for cold-drying paints

Chemicals
Increase in energy costs causedby fluctuations in crude oil and/or
electricity prices
Automobile Brakes
Chemicals
Responding to GHG*2 reduction
requests from customers*1 Solutions business within the Wireless and Communications Business●—
Chemicals
Increase in sales of insulation materials due tothe popularization of ZEB*3
Chemicals
Increase in sales of fuel cell bipolar plates due toproliferation of fuel cells—

Wireless and Communications
Increase in demand for disaster prevention
products and services due to increased flood risk

Automobile Brakes
Chemicals
Physical damage and loss of businessinterruption caused by flooding

—

●

●

●： Items of high importance*2 Greenhouse gases*3 Zero Net Energy Buildings

35

Data Section

hence we will contribute to the achievement of the SDGs through our business. The Group considers

are core.

3 Evaluate business impacts

1. Assess materiality of climate-related risks

The direction targeted by the Nisshinbo Group overlaps with the Sustainable Development Goals (SDGs),

manufacturing industry constituting the focal point of Group business activities, these four goals (right)

2 Identify and define range of scenarios

4 Identify potential responses

Nisshinbo Group SDGs Initiatives

goals to which it will specifically contribute while maintaining an awareness of all the SDGs. With theAutomobile Brakes

Overview of Business Segments

Fiscal 2024 target

Solutions businessin Wireless andCommunications

How We Achieve Sustainability

Fiscal 2021 results

Selectedbusinesses
with high risk/
opportunity
impacts

committees such as the Corporate Strategy Conference comprising*1 Refers to“Corporate Governance Structure”on page 38, Corporate Governance.

Fiscal 2021 target

Improvement of recycling rate

The Nisshinbo Groupissues and monitor targets and progress toward their resolution.

Key action items

1

GovernanceSpecial Featuretoscenario: 1.5℃ –2℃ scenario).

future risks. In June 2022, Nisshinbo announced its endorsement

How We Manage Our Businessbusiness and the Automobile Brakes and Chemicals businesses.

the Task Force on Climate-related Financial Disclosures (TCFD)
recommendations. By identifying the risks and opportunities that

Where We’ve Come From,
Where We’re Going

Contribution to the Environmental and Energy Field

How We Achieve Sustainability ̶ Reports Based on the TCFD Recommendations

How We Achieve Sustainability ̶ Reports Based on the TCFD Recommendations

How We Achieve Sustainability ̶ Message from the Chairman and Director

２. Identify and define range of scenarios
Where We’ve Come From,
Where We’re Going

With 2050 as the time axis, the Nisshinbo Group analyzed climate-related risks and opportunities using the warming progression anddecarbonization scenarios. The following documents were referenced for the analysis.
Warming Progression Scenario

Decarbonization Scenario

International Energy Agency (IEA)

Intergovernmental Panel on Climate

International Energy Agency (IEA)

・Stated Policies Scenario (STEPS)

Change (IPCC)

・Net-Zero Emissions Scenario (NZE)

Change (IPCC)

・Reference Technology Scenario (RTS)・RCP8.5

・Sustainable Development Scenario (SDS)・RCP 2.6 or RCP 4.5

Intergovernmental Panel on Climate

In the warming progression scenario, physical risks will become apparent at some bases, while demand for disaster prevention–related
products and services is expected to increase. In the decarbonization scenario, although demand for friction material replacements will

How We Manage Our Businessdecrease due to the extended life of friction materials for brakes in line with the expansion of EVs due to the spread of decarbonization, thedemand for insulation materials and high-performance materials that contribute to saving energy is expected to increase.

3. Evaluate business impacts
In this scenario analysis, we evaluated the financial impacts on each business. As shown in the table below, the magnitude of the impact
varies depending on the evaluation items and scenarios, thus we assume that capturing demand will lead to the creation of business
opportunities, especially in friction materials for brakes (Automobile Brakes business) under the ongoing warming scenario and bipolar plates
for fuel cells (Chemicals business) under the decarbonization scenario.

Category

Assessment Item

Assessment of Impacts
Warming Progression Scenario

Category

Decarbonization Scenario

Precipitation,
Weatherpatterns

Increase in sales of cross-linking
agents due to rising demand forcold-drying paints
Increase in energy costs caused
Energy mix by fluctuations in crude oil and/or
electricity prices

・ All Departments

As the risk of flooding increases due to the frequent occurrence of natural
disasters, the demand for disaster prevention products and services iswhich will lead to the enhancement of corporate value over the medium
to long term
At present, the Board of Directors comprises 12

information, Nisshinbo has taken a more active

corresponding to changes and regulations associated with decarbonization.

members, of which seven are inside directors

approach toward the environment, carbon neutrality,and five are outside directors. Of the five outside

TCFD, human rights and D&I. We will engage indirectors, three are male and two are female. The

discussions that take sustainability management

five outside directors are diverse, with expertise

into consideration to determine the degree to whichspanning management, IT and human resources,

we are able to link economic value and financial

As demand for cross-linking agents, insulation for building materials
and fuel cell separators is expected to increase, we intend to steadily
capture these rising demands. In response to increased flooding risks,
we will promote efforts to prevent and mitigate damage.
Furthermore, to expand support for the TCFD recommendations, in fiscal
2022, we will widen the scope of climate change scenario analysis to include

the legal profession, university professorships andinformation to social value initiatives, and how best to

While demand for brake friction materials is expected to grow due tothe Wireless and Communications (Marine systems, ICT and Mechatronics,

rising demand for automobiles, as the ratio of EVs increases, the demand

Mobility), Micro Devices, Precision Instruments and Textiles businesses.

the semiconductor industry. From the perspective

approach the relationship between the two.

・ Automobile Brakes

Risk Management
Regarding risks and opportunities related to climate change to which the Group should pay attention, risks are unambiguously ascertained,
analyzed and evaluated in each business based on the Risk Management Rules. The persons in charge of each business prioritize risks andhypothesize the magnitude of their impacts on business and future scenarios. This information is comprehensively mapped at the Corporate
Strategy Center and deliberated by the Corporate Strategy Conference and the Board of Directors.

The Nisshinbo Group aims to seize business opportunities related to climatechange while mitigating risks. To mitigate climate change–related risks, weare aiming for carbon neutrality by 2050 and proactively promoting climatechange countermeasures such as energy conservation activities and reduced
perfluorocarbon (PFC)* emissions.
*Perfluorocarbon is a fluorine-based greenhouse gas used for dry etching in the semiconductor manufacturing process.

of the skills matrix, each plays a role appropriate for

Although immediate costs might increase, long-

improving offensive and defensive Group governance.

term, global efforts toward the environment, humanRegarding outside directors and outside members

rights and the value of human resources constitute theof the Audit & Supervisory Board, as Chairman offoundation upon which we will generate new businessthe Board, I welcome guidance and questions from

opportunities, while avoiding social costs and future

third-party perspectives differing from those of inside

cost increases due to market failures and negative

Target for 2024 (The 5th Three-Year Environmental Target)
Reduce greenhouse gas emissions by 35% or morecompared to fiscal 2014

managers and strive to elicit frank comments enabling

externalities. I also want to deepen Board of Directors

the Board to draw out and dig deep into potential

discussions in line with current realities to share

Target for 2030 (The Medium-Term Environmental Target)
Reduce greenhouse gas emissions by 50% or morecompared to fiscal 2014

issues from the perspective of a diverse range ofwith various stakeholders the robust scenarios andstakeholders. I also bear in mind the connection toobjectives that will contribute to enhancing corporate

Target for 2050 (The Long-Term Environmental Target)
Aim to be Carbon Neutral

improving departmental and executive accountability

value and society over the medium to long term.

For more detailed information, please visit the Sustainability section of the Nisshinbo Group website.
https://www.nisshinbo.co.jp/english/csr/index.html

to better inform the Board of Directors.
Furthermore, amid growth in the importance ofESG, the SDGs and other social value and non-financial

37

Data Section

Indicators and Targets

36

linking economic value and financial information to social value initiatives,

Overview of Business Segments

expected to increase, thus we intend to steadily capture rising demand.

The Board of Directors will deepen discussions regarding the necessity offor brake repairs might decrease, thus we will provide products and services
・ Chemicals

・ Solutions Business within the Wireless and Communications Business

Chairman and Director
Nisshinbo Holdings Inc.

How We Achieve Sustainability

4. Identify potential responses

emissions, avoid carbon taxes by saving energy and reduce energy costs.

Increase in demand for disasterprevention products and services
due to increased flood risk

Severity of
extremePhysical damage and loss of busiweather
ness interruption caused by flooding
eventsCustomer
Responding to GHG reduction
preferences requests from customers

Masaya Kawata

Assessment of Impacts
Warming ProDecarbonizagression Scenario tion Scenario

Increase in sales of insulation materials due to the popularization of ZEB
Customerpreferences Increase in sales of fuel cell bipolar
plates due to proliferation of fuel cells

Increase in sales of brake friction
materials due to change indemand for automobiles

To minimize risks related to GHG emissions, we will work to reduce GHG

Assessment Item

： Negative impact

Special Feature

Taxing emissions by introducing
a carbon tax
Carbonprice： Positive impact

How We Achieve Sustainability ̶ Corporate Governance

Board of Director Duties and Diversity

selects management talent as candidates for directors who

Directors and the Board of Directors recognize that they have afirm commitment and ability to realize the Company’s Corporate

fiduciary duty to shareholders and thus strive to appropriately

Basic Stance

Philosophy and increase corporate value, and who enhance thereflect shareholders’intentions within the board. By overseeing

Nisshinbo is aiming to increase corporate value over the medium to long term as an Environment and Energy Company group by
operating its various businesses based on global business management and cash flow management. We follow the Nisshinbo
Group corporate philosophy:“Change and Challenge! For the creation of the future of Earth and People.”To achieve this, we are
improving the quality of corporate governance and other aspects of our organizational culture. In parallel, we are striving to deliver
share price in management decisions.
By making rapid and bold decisions based on risk-taking in line with our management principles, we are working to enhance
management efficiency while ensuring transparency, as well as improve accountability, act ethically and build a stronger corporate
governance structure founded on our Corporate Philosophy.

Corporate Governance Policy
We have formulated the Nisshinbo Corporate Governance Policy,
which clearly states our basic thinking on corporate governanceand related initiatives. By steadily implementing the principles
we aim to improve the effectiveness of governance and create aframework for rapid and bold decision-making that contributes tosustained growth and increased corporate value over the medium
to long term.

Organizational form

Company with Auditors

Number of directors under the Articles of Incorporation

14

Term of office for directors under the Articles ofIncorporation

1 yearChairman (except when
concurrently serving as
President)

Chairman of the Board of Directors
Number of directors (including outside directors)

12（5）Outside director appointment status

Appointed

Composition of the
Directors

Corporate Governance Reforms
Improvement Eﬀorts in 2021
・As a Prime Market‒listed company, in response to Corporate Governance Code revisions (June 2021), the Group began conducting
climate change scenario analyses in accordance with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.

2006

Introduced outside director system andmanaging oﬃcer system, reduced term ofCorporate Governance Policy formulated,established Remuneration Committee andNomination Committee (both discretionary

Audit & Supervisory Board

ReportInstruct

Discusses business execution matters

ReportIntroduced restricted stockcompensation systemof which are women）

0

5

10

15（people）

Financial Auditors

Coordinate

Accounting audit

Representative Directors

2018

Number of outside directors （Reappoint

Coordinate

ReportAbolished internal advisor andconsultant system

Number of inside directors（year）
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022

Internal Audit Oﬃcer

Evaluating the Effectiveness of the Board of Directors
The Board of Directors conducts a survey on the efficacy of theefficacy are held to confirm the status of responses to priority

Board in which all officers participate to evaluate the efficacy ofissues set each year. The 2021 efficacy survey results confirmed

the Board of Directors through the analysis of aggregated data andthat Board members with various backgrounds leverage their

the comparative verification of previous year results. Furthermore,management experience and expert knowledge to actively offer

discussions regarding measures and initiatives aimed at improving

opinions and engage in discussions.

2021 Priority Issues

・Systematically deliberated the overall direction of management

Report
Audit<Audit functions>

Corporate Governance Structure

・Provide materials and lecture planning aimed at inculcating a deeper

strategies and multiple projects related to the business portfolio

understanding of the business environment behind the issues

・Planned and held conferences related to the TCFD recommendations

・Facilitate focused discussions regarding the overall direction ofand global environmental problems

management strategies and the business portfolio

2022 Priority Issues
・Facilitate discussions related to priority themes such as sustainability,

The Group has adopted a Company with Audit & Supervisory

officers and strengthening oversight by the Board of Directors,

Status of Response to Priority Issues

Board system. In addition, Nisshinbo has separated decision-

we are improving management efficiency and transparency and・Increased outside director and outside Audit & Supervisory Board

the business portfolio and management strategies

making and oversight from business execution and adopted

creating an effective governance structure that will support themember participation in internal meetings and opportunities to utilize

・Implement various measures contributing to deeper discussions by,a managing officer system to reinforce those functions. By

Group’
s sustained growth and enhance corporate value over thethe video conferencing system to promote an understanding of diverse

and the increased efficacy of, the Board of Directors and independenttransferring responsibility for business execution to managing

medium to long term.

business environments

committees

39

Data Section

Managing Oﬃcers, Business Divisions, Group Companies

38

Overview of Business Segments

Discuss/
Report2017
Appoint/Dismiss

Composition of the Board of Directors

How We Achieve Sustainability

2016

2

Audit

Instruct

Ratio of women: 16.7%4（2）Four Audit & Supervisory Board Members(including two independent outside audit &supervisory board members)<Business execution functions>Board of Management

Ratio of Outside Directors: 41.7%

Abolished takeover defense measures

Audit

Recommend
Appoint/
Oversight

Diversity

Board of Directors

12 directors (including ﬁve independent outside directors)

Nomination Committee
Remuneration Committee

Independence

bodies), started evaluating eﬀectiveness ofBoard of Directors

in the Skill Matrix on page 48.

along the lines of environment and energy, the Board of Directors

2015

Coordinate

women). The skills and expertise of each Board member are listed

To promote the globalization of each Nisshinbo company

5<Decision-making and oversight functions>of which five are independent outside directors (including two

increased profitability and higher returns for shareholders.

Number of Audit & Supervisory Board Members underthe Articles of Incorporation

Appoint/Dismiss

30, 2022, the Board of Directors was composed of 12 directors,

the Company aims to achieve greater accountability to stakeholders,

Corporate Governance Structure
Appoint/Dismiss

Directors, as well as the skills of each Board member. As of Marchthat is focused on quick and bold decision-making. In this manner,oﬃce for directors from two years to one

General Shareholders' Meetingknowledge, expertise and other skills required for the Board ofCompany fearlessly confronts risk and works to achieve governance5

Number of outside corporate auditors designated as
independent officers

which includes outside directors, deliberates the experience,business execution and decision-making. At the same time, theNumber of outside directors designated as independent
officers

Number of Audit & Supervisory Board Members(including outside members)

gender and nationality. Furthermore, the Nomination Committee,

management systems, directors and the board help to monitor

Special Featureof the policy and revising and improving its content as needed,

Matters concerning the composition of governing bodies
and organization management

composition of the board through greater diversity in areas such as

the preparation and management of internal control and risk

How We Manage Our Businessquantitative growth in earnings and shareholder value, focusing on ROE to improve profitability and placing importance on theAdvisepossess outstanding management experience, have the necessary

Where We’ve Come From,
Where We’re Going

Corporate Governance Global complianceHow We Achieve Sustainability ̶ Corporate Governance

Remuneration for Directors and Senior Managers
To increase transparency and objectivity in processes forthe maximum limits approved by the General Shareholders’

The director in charge of IR supervises numerous measures aimed

disclosure outside the Company and various types of direct

determining remuneration, Nisshinbo has established a

Meeting. Stock-based remuneration for each role is set within

at communicating with shareholders and investors, actively

dialogue.

Remuneration Committee as an advisory body for the Board ofseparate maximum limits for amounts and shares determinedengaging in IR activities that include accurate and fair information

Directors. As of March 30, 2022, the committee comprised theby resolutions of the General Shareholders’Meeting. However,chairman, the president and five outside directors. The committee

outside directors receive only basic remuneration (monthly

chairman is selected by members of the committee.

payment) and retirement benefits are not paid to directors.
Remuneration for managing officers is based on the same policies

Remuneration for directors comprises basic remunerationand procedures.

(monthly payment) and bonuses and stock-based remuneration

Remuneration for Directors and Auditors (fiscal period ended December 2021)

Classification

Directors(excluding outside directors)

Total remuneration(millions of yen)

Nisshinbo recognizes that continuous dialogue with stakeholders

to resolve any issues by emphasizing dialogue with customers,

is key to supporting sustained growth in corporate value. In

shareholders, employees and all other stakeholders connected toline with the aims of our VALUE commitment, we work hard

the Nisshinbo Group.

Stakeholder Engagement Initiatives

Remuneration breakdown (millions of yen)
Basic remuneration(Fixed)Bonus(Performance-linked)

Restricted stockcompensation plan

162

48

19

230

Stakeholder Engagement

Total
number of payees

8

34

34

̶

̶

2

Outside directors and outside Audit &Supervisory Board members

60

60

̶

̶

7

Notes: 1. Total maximum remuneration for directors: No greater than ¥400 million per year (Employee salaries of individuals simultaneously appointed as employee and director are not included in
payments to directors. Directors are also eligible to receive compensation through a restricted stock compensation plan, up to a maximum value of ¥40 million per year.)
2. Total maximum remuneration for members of the Audit & Supervisory Board: No greater than ¥70 million per year
3. The Company had 12 directors (including five outside directors) and four Audit & Supervisory Board members (including two outside members of the Audit & Supervisory

Shareholders/investors

and dismissing directors, Nisshinbo has established a Nomination

Committee informs the Board of Directors of candidates based on

Committee as an advisory body for the Board of Directors. As

prescribed criteria. If reasons for ineligibility arise with respect toof March 30, 2022, the committee comprised the chairman,

senior management, directors or executive officers, their dismissal

the president and five outside directors. Regarding senioror removal is reported to the Board of Directors.

shareholder rights is not impeded and will take appropriate
measures to fully protect shareholder rights. The Company will
implement various measures related to communication withof the General Shareholders’Meeting.
The Company has set out a policy for cross-shareholdings.
In line with that policy, it regularly assesses the purpose andeconomic rationale for cross-shareholdings based on capital costs
and other indicators.
Shares with diminished strategic value are sold incrementallyand systematically.

40

Suppliers

100
80(¥74.8 billion)

73(¥61.5 billion)

66

60(¥69.1 billion)

63(¥46.9 billion)

55(¥45.7 billion)

20

2018.32018.122019.122020.12Six times

General Meeting of Shareholders

One time

Briefings and small meetings
for institutional investors

Briefings: Twice annually, One-on-one
meetings: 68 times

Online information and publications
for investors

Publication of integrated report

Publication of internal newsletter

Published seasonally(published quarterly)

Corporate communications

Employee surveys

One time

Diversity

ESG education

Four times

Sustainability Development

Internal whistleblower system

Six cases

Sustainability Development

Disclose and raise awareness ofGreen Procurement Guidelines

One time

Procurement Division

Group education

One time

Water consumption volume andhazardous substance productinspections

Water consumption four times annually
Chemical substances in products
annually

Sustainable procurement surveys

One time

Factory tours, workshops

13 times

Factories, engineering
departments

Participation in projects to protect
biodiversity

Four times

Business sites

Participation in neighborhood cleaning
activities

17 times

Business sites

Marketing/engineering

Corporate communications

Sustainability Development

52

40

0

Online seminars

Data Section

shareholders and investors and ensure the appropriate operation

Changes in Cross-Shareholdings(stocks)

29 times

Employees

Protecting the Rights and Ensuring the Equal Treatment of Shareholders
The Company shall ensure that the exercise of minority

Exhibitions

Overview of Business Segments

management, directors and executive officers, the Nomination

Key department/site

How We Achieve Sustainability

Board) as of March 30, 2022.

To increase transparency and objectivity in processes for selecting

Times

Customers

4. The actual amount of bonus payments reflects degree of achievement regarding performance targets such as net sales, pretax profits, operating cash flow and other indicators related to
the Group or businesses remitted at a fixed rate according to position.

Selection and Dismissal of Directors and Senior Managers

Examples of engagement

Special Feature

Audit & Supervisory Board members(excluding outside Audit & Supervisory
Board members)

Stakeholder

2021.12NGOs, NPOs,
government
agencies

How We Manage Our Business(restricted stock compensation plan), both of which are set within

Where We’ve Come From,
Where We’re Going

Dialogue with Shareholders

41Compliance

Risk Management

Based on Public Entity and Consistent Integrity—the fundamental spirit of Nisshinbo’s Corporate Philosophy—the Group’s mission is

Risk Management System

to act with fairness and integrity to contribute to society through its business activities. To achieve our mission, we have formulated

The Nisshinbo Group has established a risk management system, shown in the diagram below, to appropriately address business risks andBusiness Conduct Guidelines in order to win trust from the public through fair and honest business activities.

minimize any losses associated with those risks.

Corporate Ethics Committee andCorporate Ethics Reporting System

Ensuring Business Confidentiality

Risk Management Structure

Nisshinbo has established a Corporate Ethics Committee to handle

prevent any leak of confidential information such as intellectual

all compliance matters across the Group.

property, technologies and expertise disclosed during the productNisshinbo has also established a Corporate Ethics Reporting
System to rapidly identify and prevent any reoccurrence ofsuspected or actual legal violations. Group employees andexternal parties can submit reports to the system. Group
employees can report their concerns internally to the Corporate

Nisshinbo signs non-disclosure agreements with suppliers todesign and development stage and across all points of the supply
chain.
We also conduct annual internal audits to check whether theGroup’s trade secrets are being managed appropriately.

Ethics Committee or directly to an outside corporate attorney. All

Sustainable Procurement Basic Policy

information provided by whistleblowers is treated in the strictest

Nisshinbo has formulated the Nisshinbo Group Sustainablefrom unfair treatment. The Corporate Ethics Committee takes
appropriate steps to deal with issues raised by reports.

Compliance Education
To ensure fair and honest business practices, the Nisshinbo Group
conducts compliance training for different employee levels andassignments.
From the fiscal year ended March 2017, we added annualcompliance training for manager-grade employees in the Group to
our list of KPIs in order to raise awareness about compliance. We
also created a compliance training manual for managers in both
Japanese and English to be used in training sessions across theGroup.
In addition, compliance training is provided at each subsidiary in

Initiatives to Prevent Corruption

Nisshinbo Chemical
Nisshinbo Textile

AnnualreviewPresidents and key
personnel from HD

Political/
economic

and core operatingcompanies

environmental protection, human rights, health and safety, andquality assurance.

Instruct

1. To strictly observe all legal obligations and social norms
2. To always pursue business in a sound and fair manner
3. To properly manage all information

Person with ultimate
responsibility= President of HD
Appoint
Risk management
general manager
Risk Management
Oﬃce

framework
Conﬁrmrisk
management
status

5. To respect all basic human rights
6. To strive for a secure and healthy living and working
environment
7. To aim to ensure the quality and safety of all products andservices
We are working to extend our sustainable initiatives across theBoard ofManagement

Board ofDirectors

Verify major risks and risk developments, discuss responses

Report on status of urgent and high-priority risks

Note: HD means Nisshinbo Holdings Inc.

entire supply chain by asking suppliers to adhere to our principles
in those seven areas.

The Nisshinbo Group established the“Nisshinbo Group Crisis

is distributed to all subsidiaries, including overseas Group
companies. In addition to information about Article 18 of Japan’sUnfair Competition Prevention Act (prohibition of provision of illicit
information about international treaties and laws designed toprevent corruption, such as the United Nations Convention Against
Corruption (UNCAC), OECD treaties on preventing corruptionof overseas public officials in international transactions, the U.S.
Foreign Corrupt Practices Act (FCPA) and its related guidelines,
and the U.K. Bribery Act. Nisshinbo updates the guidebook asnecessary and uses it as part of its corruption prevention measuresin the Group.

42

Management Regulations”to respond promptly in the event of anearthquake, fire or other emergency.
Furthermore, to prepare for large-scale earthquakes andother emergencies from the perspective of business continuity,
the Group conducts annual information communication training
necessary for confirming the safety of employees and quickly
recovering from disasters. A“safety confirmation and emergency
contact system”was developed and introduced to confirm safety
quickly and reliably.

Disaster Prevention System

We have also conducted annual disaster prevention inspections
for more than 50 years to strengthen response capabilities
immediately after a disaster and improve our initial response
system. Furthermore, we are deploying business continuity
management (BCM) across the entire Group, organically linking
initial response systems with business continuity planning (BCP).

Information System
The Group is promoting the transition of its major systems to thecloud with the aim of preparing for large earthquakes and otherdisasters, as well as realizing safe operations 24 hours a day, 365
days a year.
Please see Key Risks and Opportunities on page 29.

Self-defense fire brigades have been established at Nisshinbo
Holdings and major Nisshinbo Group companies, with inspectionsof fire protection equipment and firehose training conducted
regularly.

43

Data Section

profit, etc., to foreign public officials, etc.), the guidebook provides

Conﬁrmrisk
management
status

4. To give due consideration to protection of the environment

regulatory systems and stepping up efforts to prevent and expose

responding to related regulations overseas. The guidebook

industrial
structure

Identify risks for entire Groupand verify response measures

Risk Management Structure

Prevention Guidebook, which includes information about

ClimatechangeOperating environment

In recent years, countries worldwide have been reinforcing
bribery and corruption. Nisshinbo has created a Corruption

Internal risksMonthly
reviewBusiness portfolio
Capex/R&D
Attract/train
human resources
Regulatory Governance, etc. Changes in

Procurement Basic Policy, clarifying its stance on seven specificareas: legal compliance, fair trade, information security,

Implement
PDCA

External risks

Overview of Business Segments

accordance with conditions in each country, region and industry.

Identify and evaluate risks,develop appropriate responses

Nisshinbo Brake
Nisshinbo Mechatronics

How We Achieve Sustainability

work sites and provides training to employees prior to overseas

Formulate plan for new ﬁscal year

Nisshinbo Micro Devices

Special Featureof confidence, and every effort is made to protect whistleblowers

Nisshinbo Holdings (HD)Japan Radio

How We Manage Our Business

How We Achieve Sustainability ̶ Risk Management

Where We’ve Come From,
Where We’re Going

How We Achieve Sustainability ̶ ComplianceHow We Achieve Sustainability̶
Outside Director Discussion with the President of Nisshinbo Micro Devices

have established a system able to consistently provide a series

Solutions Provider in the Expanding Semiconductor Market

signals emitted from sensors, converting and processing themof inflows and outflows, filtering and amplifying various analog
to a digital format, and providing real world feedback throughIn January 2022, New Japan Radio Co., Ltd., and Ricoh Electronic Devices Co., Ltd., were integrated toactuators. In February 2022, D-CLUE Technologies Co., Ltd.,launch Nisshinbo Micro Devices Inc. Nisshinbo Holdings Inc. outside director Naoko Tani and president ofalso joined the Nisshinbo Group, further strengthening its

the new company Satoru Taji discuss semiconductor market growth potential and Nisshinbo Micro Devices’competitive advantages.

digital processing know-how. We expect the expansion of ourportfolio of high-value-added products to become a majorGroup strength, leading to enhanced customer proposal
production, we believe the Group’s strengths lie in thedevelopment and commercialization, from front- to back-end

Naoko Taniprocesses, of proprietary robust technological capabilities that
include cutting-edge technologies used on the Yashiro Plant

Satoru TajiAfter joining Ricoh Company,
Ltd., in 1981, Mr. Taji spent thenext 23 years engaged in device
gaining experience in productdevelopment and businessplanning, in 2015, Mr. Taji wasLtd. (formerly SAGA ELECTRONICS Co., LTD.), primary andsecondary mounting technologies.
Tani: I think it is also significant that there are many customers
within the Group, including Japan Radio Co., Ltd., who
use semiconductors. In addition to telecommunications

toward increasingly shorter cycles in recent years,
demonstrating instability unlike anything experienced in thepast. Since the autumn of 2020, demand has been robust on
the back of demand arising from people staying at home, thus
supply shortages have persisted until now. Amid the ongoingpandemic and rising geopolitical risks, many companies
are holding parts inventories in anticipation of supply chain
fragmentation, which tells me the way we think about propertides will change, I expect an adjustment phase to comeeventually, mainly for automobile-related parts, during which
we will see the optimization of excess inventories.
Tani: Since 2008, the players that drive semiconductor
demand have changed, with smartphones replacing PCs
and LCD TVs. Going forward, we expect DX and green
transformation (GX) to drive demand even higher, and44

major drivers of semiconductor demand going forward, as
they consume enough power to potentially overwhelm global
power supplies. While the Nisshinbo Group addresses theseissues as its corporate mission, new business opportunities
will emerge amid large-scale global investments aimed atrealizing carbon neutrality, thus it would be optimal to capture
demand for both as we move forward.

Ｑautomobiles will also expand, thus it will be advantageous

How do you personally perceive your rolein terms of adding value to the Nisshinbo
Group aim of realizing a super-smart
society?

having companies like Nisshinbo Brake, which has a network

Electronic Devices Co., Ltd. Inthat connects it directly to car manufacturers and Tier 1

Taji: Electronics and electronic components will play an increasingly

suppliers, within the Nisshinbo Group.

important role in the development of society. As a Nisshinbo Group

president of the newly
inaugurated Nisshinbo
Micro Devices Inc.

Ｑ

What is your view regarding businessdevelopment challenges andopportunities?

because the volume of telecommunications data will increase
dramatically, we see this as leading to large-scale investments
in data centers and telecommunications infrastructure.
Taji: With the advent of IoT and the smart society, sensing
technologies will be used everywhere, thus I think demand fortelecommunications infrastructure will grow in a straight line.
We believe the semiconductor industry will grow steadily overthe medium to long term as the smart society and the shift toEVs spread to developing countries after having taken root indeveloped countries.

Given these conditions, what is the
Nisshinbo Group’s competitive advantage
relative to semiconductors?

Taji: Although the two companies both had analog
technologies at their core before the integration, there
is almost no overlap in terms of technologies, products
and, particularly, overseas customers. Each company has
strengthened their respective areas of expertise and achieved
growth. Amid rapid expansion in the market for sensors
facilitating the realization of a smart society, by fusing the
product and technological strengths of each company, we

in Nisshinbo Micro Devices, to ensure they experience
the benefits of this integration, I want to raise employee
awareness through repeated experiences of success inthe collaborative development of new products and thedissemination and sharing of information.
Tani: In the past, I reviewed the results of a Ricoh Electronic
Devices employee satisfaction survey, which made an
impression on me, as employee satisfaction was extremely
high. We have high expectations for your leadership, Mr. Taji.
Taji: Including its lines and group companies, Nisshinbo Micro
Devices will have a large family of more than 3,500 people, so
I want to foster an environment where each person can think
and act autonomously. To proceed smoothly with the postmerger integration (PMI) process, including this transformationin employee awareness, and evolve into a company with asturdy constitution, I think it is important to ensure that directinteractions with other cultures and methods are perceived
positively as an opportunity to change for the better. Reducing
adverse environmental impacts is another major issue forsemiconductor factories, which consume vast amounts ofwater and energy. To this end, we will consider various
measures leading to drastic reductions in the consumption ofboth resources.

company, our role is to be useful to society by firmly determining
a future direction and taking a proactive approach, while alsoachieving our mission of realizing profit as a company.
Tani: After being appointed outside director, I learned that mymother was also involved with Nisshinbo in the 1940s, which I feelis an extraordinary turn of fate. I have participated in management
for more than a year now, and my sense is that the Group values
human resources and is managed with strong governance.
Functioning as a check on management as an outside director,
I want to contribute to further drawing out positive aspects of
the Nisshinbo Group, which has diverse human resources andencourages the active participation of young people and women.

Ｑ

In closing, do you have a message for
Nisshinbo stakeholders?

Taji: We will provide customers with valuable products
and modules by“enhancing”technologies possessed byboth companies and“advancing”products and services
created by those technologies, with the aim of contributing
to the realization of 2025 numerical targets for net sales of¥100 billion and an operating margin of 10%. Beyond that,
we will incorporate AI and digital technologies into analog
technologies as we aim to become an analog solutions
provider offering unprecedented new value. I sincerely thankall our stakeholders for their continued support.
Tani: As the Nisshinbo Group is creating innovations focusedon society 20 years in the future, we hope to continue
meeting stakeholder expectations.

45

Data Section

inventories is changing. While it is difficult to predict when

Tani: An urgent issue involves data centers, which will be

appointed president of Ricoh
2022, Mr. Taji was appointedＱ

commensurate with an Environment and Energy Company.

Overview of Business Segments

Taji: Volatility in the semiconductor market has trended

We develop products contributing to the resolution of issues

How We Achieve Sustainability

Ongoing semiconductor supply shortages
have been exacerbated by the pandemic.
What is your view on recent changes
in the semiconductor market and its
potential for growth?

are low power consumption, high accuracy and high efficiency.

infrastructure, demand for semiconductors used in

Taji: As employees are the source of business developments

Ｑ

Taji: We possess technologies for which the greatest strengths

Special Featureand process development. After

six- and eight-inch lines and Nisshinbo Micro Devices AT Co.,As an Environment and Energy Company
group, how will you attempt to resolve
issues facing the environment and society
and co-create value with stakeholders
through your products and services?

How We Manage Our Businesscapabilities and synergies through cross-selling. Regarding

Ms. Tani has been involved in
the semiconductor businessfor many years, including
experience working at SEMI,
which handles exhibitions andstandardization activities at
the international association ofsemiconductor manufacturing
equipment and materials. In
2007, Ms. Tani was appointed
president of Semiconductor
Portal Inc. (current position),
which is engaged in thedissemination of semiconductor
and semiconductor-related
information via a portal website,
as well as the management ofinternational conferences. Ms.
Tani was appointed outside
director in 2021.

Ｑ

Where We’ve Come From,
Where We’re Going

Further Refining“Connect Everything”Technologies to Grow as an Analog

How We Achieve Sustainability ̶ Board of Directors, Audit & Supervisory Board Members and Managing Officers

Where We’ve Come From,
Where We’re Going

Board of Directors, Audit & Supervisory Board Members and Managing Officers（As of March. 30, 2022）

Board of Directors

Director (Outside Director)

Director (Outside Director)

Director (Outside Director)

Shinobu Fujino

Hiroaki Yagi

Hiroyuki Chuma

Naoko Tani

Board of Directors meeting participation:
Attended 14/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 13/13* meetings

Apr. 1987: Joined Ryoka Systems Inc.
June 2003: Opened a counseling businessoffice (to the present)
June 2015: Outside Director of the Company (to the present)

Apr. 1981: Appointed as Public Prosecutor
Jan. 2007: Special Investigation Director ofTokyo District Court Public Prosecutors Office
Dec. 2015: Chief Prosecutor of Tokyo District Court Public Prosecutors Office
Sept. 2016: Deputy Prosecutor-General ofSupreme Public Prosecutors Office
July 2018: Superintending Prosecutor ofTokyo High Public Prosecutors Office
Mar. 2019: Registered as attorney-at-law (tothe present)
June 2019: President of Japan International
Training Cooperation Organization (JITCO)(currently Japan International Trainee &Skilled Worker Cooperation Organization) (tothe present)
Mar. 2020: Outside Director of the Company(to the present)

Aug. 1984: Assistant Professor of Department of
Economics, Southern Illinois University Carbondale
July 1985: Associate Professor of Faculty of
Economics, Tokyo Metropolitan University
Apr. 1992: Associate Professor of Graduate School of
Economics/Faculty of Economics, Hitotsubashi University
Apr. 1993: Professor of Graduate School of Economics/Faculty of Economics, Hitotsubashi University
Apr. 1999: Professor of Institute of Innovation
Research, Hitotsubashi University
Jan. 2000: Visiting Professor of Department of
Economics, Yale University
Apr. 2000: Faculty Fellow, Research Institute of
Economy, Trade and Industry (RIETI)
Apr. 2004: Director of Research, National Instituteof Science and Technology Policy (NISTEP)
Apr. 2012: Professor of Graduate School ofCommerce & Management/Faculty of Commerce& Management, and Institute of Innovation
Research, Hitotsubashi University
Apr. 2014: Professor of Faculty of Social Innovation/Graduate School of Innovation and Social
Studies, Seijo University
Apr. 2015: Professor Emeritus of Hitotsubashi University
Apr. 2015: Faculty Fellow, RIETIMar. 2020: Outside Director of the Company (tothe present)

Apr. 1978: Joined Suntory Limited
June 1980: Joined Marcom International Inc.
Sept. 1985: Joined SEMI Japan
Apr. 2001: Joined Semiconductor Portal, Inc.
Director of Semiconductor Portal, Inc.
Nov. 2002: Representative Director of Semiconductor Portal, Inc.
June 2007: President and Representative
Director of Semiconductor Portal, Inc. (to thepresent)
Mar. 2021: Outside Director of the Company(to the present)

Number of Company’s shares held: 0 shares

Chairman and Director

President and Representative Director

Masaya Kawata

Masahiro Murakami

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Number of Company’s shares held: 140,747 shares

Apr. 1982: Joined the Company

Apr. 2008: Managing Officer, Senior Manager of Corporate Governance Department of Corporate Strategy Center, Senior Manager of Human Resources & Administration
Service Department of Business Support Center (served
concurrently) and General Manager of Property Management Department of the Company (served concurrently)

Apr. 2009: Deputy Chief of Business Support Center(served concurrently), Senior Manager of Corporate
Strategy Department of Corporate Strategy Center(served concurrently) and Senior Manager of Finance,
Accounting & IT Service Department of Business Support Center of the Company (served concurrently)
June 2010: Director and Chief of Business Support
Center of the Company (served concurrently)
Jan. 2012: Responsible for Property Management
Department of the Company

June 2014: Chief of Corporate Strategy Center of
the Company (served concurrently)

June 2015: Director and Senior Executive Managing
Officer of the Company
June 2016: Representative Director and Senior
Executive Managing Officer of the Company
June 2018: Vice President and Representative
Director of the Company

Mar. 2019: President and Representative Director of
the Company (to the present)

Number of Company’s shares held: 4,278 shares
Board of Directors meeting participation:
Attended 13/13* meetings

Apr. 1982: Joined Japan Radio Co., Ltd.
Apr. 2010: General Manager of Technical Development Department of Research and Development Headquarters of Japan Radio Co., Ltd.
Apr. 2011: Director of Laboratory of Research andDevelopment Headquarters of Japan Radio Co., Ltd.
Apr. 2012: Executive Officer and General Manager of Research and Development Headquarters ofJapan Radio Co., Ltd.
June 2012: Executive Officer and Director ofLaboratory of Japan Radio Co., Ltd.
Apr. 2017: Executive Officer and Deputy General Manager of Technical Headquarters of Japan Radio Co., Ltd.
June 2017: Director, Executive Officer, General
Manager of Technical Headquarters, and Executive of
Research and Development of Japan Radio Co., Ltd.
Apr. 2019: Director, Executive Officer, General
Manager of Technical Development Headquarters, and Executive of Business Creation of Japan
Radio Co., Ltd.
Mar. 2020: President and Representative Directorof Japan Radio Co., Ltd.
Mar. 2021: Director and Senior Executive Managing Officer of the Company
Mar. 2022: Representative Director and Senior
Executive Managing Officer of the Company(served concurrently, to the present)

Satoru Taji

Number of Company’s shares held: 1,080 shares
Apr. 1981: Joined Ricoh Company, Ltd.
Apr. 2008: General Manager, Imaging System
LSI Development Center, Ricoh Electronic
Devices Co., Ltd.
Apr. 2014: Ricoh Group Director and Deputy
General Manager of Electronic Device Division
Oct. 2014: Director, Ricoh Electronic Devices
Co., Ltd.
Apr. 2015: Group Executive Officer, Ricoh
Company, Ltd.
President, Ricoh Electronic Devices Co., Ltd.
Jun. 2018: Director, New Japan Radio Co., Ltd.
Mar. 2021: Managing Officer of the Company
Jan. 2022: Executive Managing Officer of theCompany (to the present)
President, Nisshinbo Micro Devices Inc.
(concurrent, to the present)*Mar. 2021 Since appointment as director

Audit & Supervisory Board Member

Outside Audit & Supervisory Board Member

Outside Audit & Supervisory Board Member

Toshihiro Kijima

Takumi Ohmoto

Atsushi Yamashita

Mitsunori Watanabe

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Director and Managing Officer

Director and Managing Officer

Director (Outside Director)

Kazunori Baba

Yasuji Ishii

Shuji Tsukatani

Keiji Taga

Audit & Supervisory Board meeting participation: Attended 14/14 meetings

Audit & Supervisory Board meeting participation: Attended 14/14 meetings

Audit & Supervisory Board meeting participation: Attended 14/14 meetings

Audit & Supervisory Board meeting participation: Attended 14/14 meetings

Number of Company’s shares held: 21,315 shares

Board of Directors meeting participation:
Attended 16/16 meetings

Number of Company’s shares held: 14,790 shares

Board of Directors meeting participation:
Attended 15/16 meetings

Board of Directors meeting participation:
Attended 16/16 meetings

Apr. 1983: Joined the Company
Apr. 2009: Managing Officer, Senior Manager ofCorporate Governance Department of Corporate
Strategy Center and Senior Manager of Human
Resources & Administration Service Department
of Business Support Center of the Company(served concurrently)
June 2013: Deputy Chief of Business Support
Center of the Company
June 2014: Director and Managing Officer of theCompany
President and Representative Director of
Nisshinbo Textile Inc.
June 2016: Executive Managing Officer of theCompany
Mar. 2019: Director and Executive Managing
Officer (to the present), and Chief of Corporate
Strategy Center of the Company (to the present)

46

Apr. 1988: Joined the Company
Apr. 2011: Managing Officer and General Manager of Production of Friction Materials Division of
Nisshinbo Brake Inc.
Apr. 2013: Executive Managing Officer, Senior
Manager of Strategy Office (served concurrently),
and General Manager of Product Division (served
concurrently) and Engineering Division of Nisshinbo Brake Inc. (served concurrently)
June 2013: Director and Executive Managing
Officer of Nisshinbo Brake Inc.
Jan. 2015: Director, Executive Managing Officer
and Senior Manager of Brake R&D Division of
Nisshinbo Brake Inc.
Apr. 2015: Vice President and Director of Nisshinbo Brake Inc.
June 2015: Managing Officer of the Company
June 2017: President and Representative Directorof Nisshinbo Brake Inc. (to the present)
Mar. 2019: Director and Managing Officer of theCompany (served concurrently, to the present)

Senior Manager of Finance, Accounting & IT
Service Department of Corporate Strategy Center
Board of Directors meeting participation:
Attended 16/16 meetings

Apr. 1986: Joined the Company
Jan. 2014: Senior Manager of Finance andAccounting Group of Finance, Accounting & IT
Service Department of Business Support Centerof the Company
June 2015: Senior Manager of Finance, Accounting & IT Service Department of Business Support
Center of the Company
Apr. 2018: Managing Officer and Senior Manager
of Finance, Accounting & IT Service Department
of Business Support Center of the Company
Mar. 2020: Director and Managing Officer of theCompany (to the present)
Apr. 2020: Senior Manager of Finance,
Accounting & IT Service Department of Corporate
Strategy Center of the Company (to the present)

Number of Company’s shares held: 0 shares

Apr. 1979: Joined the Company
Apr. 2007: Managing Officer and Deputy General
Manager of Paper Products Division of the Company
Apr. 2009: Director, Managing Officer, General
Manager of Strategic Planning Department,
General Manager of Specialty Paper Division of
Nisshinbo Paper Products Inc.
June 2010: Managing Officer and Deputy General Manager of Business Development Divisionof the Company, Director and Senior Executive
Managing Officer of Nisshinbo Chemical Inc.
June 2012: Vice President, Director of Nisshinbo
Chemical Inc.
June 2013: Director of the Company, General
Manager of Business Development Division of
the Company, President and Representative
Director of Nisshinbo Chemical Inc.
June 2016: Executive Managing Officer of the Company
Mar. 2019: Standing Auditor & Supervisory Board
Member (to the present)

Apr. 1978: Joined the Company
Jan. 2007: Manager of Finance Department
and Accounting Department of Accounting
and Finance Division of the Company
June 2010: Senior Manager of Finance,
Accounting & IT Service Department of
Business Support Center of the Company
June 2015: Standing Auditor & Supervisory
Board Member (to the present)

Apr. 1988: Registered as an attorney-at-law(to the present), joined Tanaka & Takahashi
Law Office
May 2001: Joined Clifford Chance Law Office
May 2011: Joined K&L Gates LLP
Oct. 2014: Joined Sonderhoff & Einsel Law
and Patent Office (to the present)
Mar. 2019: Outside Audit & Supervisory
Board member (to the present)

Apr. 1980: Joined Shikoku Chemicals Corporation
Mar. 2002: General Manager of Corporate Planning
Department of Shikoku Chemicals Corporation
June 2013: Managing Officer of Shikoku Chemicals Corporation
June 2014: Director, Managing Officer, General
Manager of Corporate Planning and Secretariat (concurrent posts) of Shikoku Chemicals Corporation
Mar. 2017: Director, Managing Officer, Deputy
Head of Planning and Management of Shikoku
Chemicals Corporation
Feb. 2018: Director, Managing Officer, Head of Osaka
Branch Office of Shikoku Chemicals Corporation
Mar. 2019: Outside Audit & Supervisory Board
member (to the present)
June 2019: Director, Executive Managing Officer(to the present), Head of Corporate Strategy
Division and Business Planning Division (served
concurrently) of Shikoku Chemicals Corporation
Mar. 2020: Head of Corporate Strategy Division andBusiness Development Division (served concurrently,
to the present) of Shikoku Chemicals Corporation

Apr. 1973: Joined Japan Development Bank
(currently Development Bank of Japan Inc.)
Oct. 1999: General Manager of Urban Development
Department of Development Bank of Japan Inc.
June 2002: General Manager of General Affairs
Department of Development Bank of Japan Inc.
June 2004: Executive Director of Development
Bank of Japan Inc.
Oct. 2008: Director and Executive Managing
Officer of Development Bank of Japan Inc.
June 2009: Vice President and Representative
Director of Tokyo Ryutsu Center Inc.
President and Representative Director of TRC Service Co., Ltd.
June 2013: President and Representative Directorof Tokyo Ryutsu Center Inc.
Director of TRC Service Co., Ltd.
June 2017: Chairman and Director of DBJ AssetManagement Co., Ltd.
June 2018: Adviser of DBJ Asset Management Co., Ltd.
Mar. 2019: Outside Director of the Company (to the present)

Number of Company’s shares held: 20,400 shares

Number of Company’s shares held: 0 shares

Number of Company’s shares held: 0 shares

47

Data Section

Audit & Supervisory Board Member

Overview of Business Segments

Director and Executive Managing Officer

Number of Company’s shares held: 13,590 shares*Mar. 2021 Since appointment as director

Audit & Supervisory Board Members

Number of Company’s shares held: 15,530 shares

Chief of Corporate Strategy Center

Number of Company’s shares held: 0 shares

How We Achieve Sustainability

June 2012: Director, Executive Managing Officer
and Deputy Chief of Corporate Strategy Center of
the Company (served concurrently)

Takeshi Koarai

Director and Executive Managing Officer

Number of Company’s shares held: 0 shares

Special Feature

Apr. 1975: Joined the Company
June 2006: Managing Officer and General Manager of Human Resources Division of the Company
Apr. 2007: Deputy General Manager of Accounting and Finance Division of the Company (served
concurrently)
June 2007: Director of the Company
Apr. 2008: Deputy Chief of Business Support
Center of the Company
Apr. 2009: President and Representative Directorof Nisshinbo Brake Inc.
June 2010: Director and Executive Managing
Officer of the Company
June 2011: Deputy Chief of Corporate Strategy
Center and General Manager of Business
Development Division of the Company (served
concurrently)
President and Representative Director of Nisshinbo Chemical Inc.
June 2012: Director and Senior Executive Managing Officer of the Company
President and Representative Director of Nisshinbo Mechatronics Inc.
June 2013: President and Representative Directorof the Company
Mar. 2019: Chairman and Representative Directorof the Company
Mar. 2022: Chairman and Director of the Company (to the present)

Number of Company’s shares held: 64,230 shares

Representative Director and Senior Executive
Managing Officer

Number of Company’s shares held: 0 shares

How We Manage Our BusinessDirector (Outside Director)

How We Achieve Sustainability ̶ Board of Directors, Audit & Supervisory Board Members and Managing Officers

Managing Officers

Selecting the skills required for directors to supervise and guide various businesses from a variety
of expert perspectives, and incorporating diversity into the Board of Directors enables Nisshinbo to
realize highly effective governance.

NameManagement
experience

International
experience andknowledge

Businessand industry
knowledge

President

Masahiro
Murakami*
Senior Executive
Managing Officer

ESG

Technology andinnovation

Legal and risk
management

Finance andaccounting

Takeshi Koarai*
Executive Managing Officers

Masaya Kawata●

Masahiro Murakami●●

How We Manage Our Business

Skill

*

Where We’ve Come From,
Where We’re Going

Expertise and Experience Required of Nisshinbo Directors (Skill Matrix)

●

●

●

●

Satoru Taji*

Kazunori Baba*●

Managing Officers

Makoto Sugiyama

Senior Manager of
Sustainability Development
Department and Human
Resources and Administration
Service Department, Corporate
Strategy Center

Special Feature

Yasuji Ishii*

Executive Managing Officer

Shuji Tsukatani*
Takeshi Koarai

●

●

●

Satoru Taji

●

●

●

●

Yasuji Ishii

●

●

●

Shuji Tsukatani

●

●

●

Keiji Taga

●

●

●

President,
Nisshinbo Mechatronics Inc.

Managing Director,
Nisshinbo Singapore Pte. Ltd.

●

●

●

●

●

●

President,
Nisshinbo Textile Inc.

Senior Manager of Property
Management Department

Yuzo Matsui●

Managing Officer

President,
Nisshinbo Chemical Inc.

●●

Managing Officer

Nobuyuki Adachi
General Manager, Business
Development Division

Data Section

Naoko Tani●Managing Officer●

Ikuo Takahashi

Hiroyuki Chuma

Managing Officer

Kaoru Murata●●

Hiroaki Yagi

Kazuo Saito●●

Shinobu Fujino

Managing Officer

Toshihiro Masuda

Overview of Business Segments●

Managing Officer●*Up to four major skills are listed for each Board member. Not all skills are represented.

48

How We Achieve Sustainability

Kazunori Baba

*Concurrent board member49At a Glance
Overview of Business Segments

Micro Devices, Automobile Brakes, Precision Instruments, Chemicals, Textiles and Real Estate. Nisshinbo

Wireless andCommunications

supplies high-value-added products that meet customer needs, driven by innovation born out of the businesscollaboration and portfolio reorganization that has kept the Group aligned with changing needs.

Where We’ve Come From,
Where We’re Going

The Nisshinbo Group is made up of seven distinct businesses—Wireless and Communications,

Net Sales Composition by Segment
Wireless and Communications¥155.0 billion 30.3%

Real Estate¥15.5 billion 3.1%
Net Sales

Textiles¥34.4 billion 6.8%

Micro Devices¥510.6 billion(

Chemicals¥11.0 billion 2.2%

Period ended
December 2021

¥77.3 billion

)

15.2%

Automobile Brakes

Precision Instruments

Special Feature¥138.2 billion 27.1%¥55.7 billion 10.9%

Wireless and Communications

How We Manage Our Business

Others¥22.9 billion 4.5%

P.51

Main business areas
Marine systems ▶ Marine radar and communications equipment

weather radars), as well as marine systems and mobility businesses.

Solutions and specialized equipment▶ Disaster prevention systems and weather radars
ICT and mechatronics ▶ Power supplies, large-format copiers
Medical equipment ▶ Probes for ultrasound diagnostic equipment, oscillators for catheters
Mobility ▶ GPS receivers, ITS equipment for vehicles

Micro Devices

Chemicals

P.54

Main business areas

Semiconductor devices, SAW filters andpower management ICs, etc.

electronic devices, supported by
microelectronics technologies.

P.57

The Nisshinbo Group is the world’s
Friction materials▶ Disc pads and brake linings

global supplier using its network

Fine carbon products

reliability to users in the shipping sector. It also provides various
disaster prevention systems, such as dam and river management
systems and weather forecasting systems. In addition, JRC
Mobility Inc., which was established in 2018 to develop theGroup’
s business in the mobility field, is pushing ahead with new
ITS* products and other existing automotive and commercial

made from natural cotton; supplies

wireless products transferred from Japan Radio Co., Ltd.
Shirts▶ Dress shirts, casual shirts and fabric*Intelligent Transport Systems: Systems that use data processing technology tosolve traffic issues such as accidents and congestion

high-quality“Made by Nisshinbo”
dress shirts, uniforms and other

Real Estate

Textiles▶ Uniform fabric and casual fabricRelated SDGs
Data Section

P.59

Main business areas
Manufactures molding products forhome appliance and automotive
applications and supplies
processed precision automotive
parts and customized production
equipment for customers
worldwide, primarily in Asia.

Bipolar plates for fuel cells

communication and navigation equipment with world-leading

products that will help realize autonomous driving, drawing on

products to markets worldwide.

covering key markets worldwide.

Precision Instruments

Thermal insulation products

P.63

Mainstay business is products

leading maker of brake friction
expanding its presence as a true

TextilesCarbodilite high-performance chemical additive

Main business areas

Main business areas

materials by market share; now

Manufactures a range of highly
promising products in theenvironmental and energy fields,such as Carbodilite, a modifier
for biodegradable plastics andwaterborne resins, and bipolar
plates for fuel cells.

P.65

Main business areas
Molding products
Precision parts processing including parts forelectronic brake systems (EBS)
Customized production equipment

Procures funds to support the
Nisshinbo Group’s growth strategy

Sales▶ Housing lots

by effectively utilizing idle plantsites and other real estate assets
arising from business restructuring.

Overview of Business Segments

analog semiconductors and other

50

The Wireless and Communications business supplies

Main business areas

Working to expand sales ofAutomobile Brakes

P.61

Japan Radio Co., Ltd./JRC Mobility Inc.

How We Achieve Sustainability

Engages in the solutions business (including disaster prevention systems andLeasing▶ ARIO Nishi Arai and other properties

P.52

Business Results and Strategy

51

Overview of Business Segments ̶ Wireless and Communications

Marine Systems
In terms of global growth strategy, to continue improving

Summary of Financial Results for 2021

inductors from NJ Components Co., Ltd., also performed well,

In 2021, the Wireless and Communications business reported

In mobility, the Japan Radio communications equipment

leading to higher sales and profits.

sales of ¥155,085 million, up 7.5% year on year, and segment

business has been gradually transferred to JRC Mobility,

profit of ¥7,815 million, up 203.4%.

and along with the ITS business, the transfer of commercial

In solutions and specialized equipment, although multiplex

wireless and other business was completed in January 2021,
the Japan Radio communication equipment business was

performance declined, dam management equipment effective

constructively liquidated and JRC Mobility began handling theat controlling floods and other water damage, water andmobility business in 2021. In addition to sales contributions

river information systems, and water level and rainfall

from RBI GmbH and LEAS GmbH in Germany, both of whichtelemetry devices performed well. Sales and profits were

became consolidated subsidiaries in June 2020, a recovery inalso higher due to strong performance in disaster preventioncommercial radio business for overseas clients led to higher

administrative radio systems for prefectures and municipalities

sales and profits.

used for ascertaining conditions and transmitting information

In medical equipment, despite higher sales of ultrasoundimaging equipment driven by heightened demand foradministrative information during normal times, transmission

diagnostics due to the spread of COVID-19, in all other areas,

systems mounted on ships to communicate with helicopters,

sales of analysis equipment and other devices declined due toand overseas systems such as coastal base stations andlower demand for examinations across Europe. Furthermore,

weather radar that transmit information necessary for safe

global difficulties in obtaining parts affected diagnostic

navigation from land to sea.

equipment, resulting in lower sales and profits.

build vessels due to fewer ships being built, equipment andmaintenance services for small and medium-sized vessels
to completed goodwill amortization in subsidiary Alphatron
Marine contributed to higher sales and profits.
In ICT and mechatronics, despite sluggish mechatronics
performance caused by tight supplies of electronic
components, there were signs of a post-COVID recovery in

Medical Equipment

to strengthen river market products, sales and services, while

In medical equipment, we continue to focus efforts

expanding market share by utilizing sales channels to theEuropean market, which is the strength of Alphatron Marine.
Furthermore, as an initiative in the digital sphere, to realize
smart ships with automated vessel operation functionality andequipment compatible with digitization, Nisshinbo is expanding
the functionality of the Smart Ship Viewer, an onboard
information-sharing service utilizing ship-to-shore networks, aswell as J-Marine NeCST, a vessel operation device comprising
the heart of the vessel, with the aim of expanding safe vessel
operation support services contributing to more efficient vessel
operations and safer navigation. We will also work to develop
marine system businesses such as integrated management
systems for offshore wind power generation. In marine systems,
we aim to generate profits by enhancing sales and service
via digital methods to reorient toward a stable profit structure.

Medium- to Long-Term Business Strategy

Solutions and Specialized Equipment

In the Wireless and Communications business, we will shift

In solutions and specialized equipment, while steadily

to management that emphasizes sales scale expansion andcapturing demand in existing businesses and strengthening

improved profitability by revising current business growth

profitability in government offices, private demand andstrategies, identifying and disposing of low-profit businesses,

overseas business fields, Nisshinbo will strive to enlarge its

and promoting business portfolio reforms that include taking

business domains by expanding into adjacent fields throughon the challenge of high-profit businesses.

alliances and M&A. We will also focus efforts on establishingdigital businesses utilizing ICT and IoT. In the public sector,

demand for certain ICT and component models. Multilayer

we will continue to expand profits through initiatives under afive-year plan to accelerate measures for the prevention andmitigation of disasters and enhanced national resilience as well

Net Sales(millions of yen)

21.12

Marine systems

32,50933,227

Communications equipment*

7,669

̶

Solutions and specialized equipment

65,607

71,254

ICT and mechatronics

20,708

Medical equipment

Segment Profit(millions of yen)monitoring field, including support for integrated controls

21.12

(303)

791

200

̶

Solutions and specialized equipment

2,683

5,557

23,726

ICT and mechatronics

(237)

128

ICT and Mechatronics

8,064

7,794

Medical equipment

456

102

In this business, Nisshinbo will promote SDGs and social

Other businesses

3,166

4,613

Other businesses

(7)

788

JRC Mobility

7,857

17,494

JRC Mobility

(571)

610

while making efforts to move to a highly profitable structure

Eliminations, retirement benefits
and other adjustments(1,271)(3,024)

Eliminations, retirement benefits
and other adjustments

353

(162)

our business domain in growth fields related to IoT and AI

Total

144,312155,085

Total

2,575

7,815

*Completed transfer of communications equipment to mobility in fiscal 2021

52

Communications equipment*

establishing sales channels. Furthermore, we will focus efforts
on wireless technologies for medical use, such as utilizing our
proprietary wireless technologies in medical equipment, andaim to enter and grow the fields of prevention, prognosis,
diagnosis and treatment support. We aim to expand and growthis business by creating digital businesses in new entry fields
based on the existing analysis equipment and intravascularultrasound businesses.

5G and LTE Initiatives
In Japan, the number of businesses attempting to create
value through the utilization of data using IoT and otherinfrastructure is expected to increase, and the issuance of local
5G radio station licenses is on the rise. Having acquired a local
5G radio station license in June 2021, Japan Radio Co., Ltd.
(JRC), is focused on deepening collaborations with business
partners through proof-of-concepts and demonstrations,providing solutions facilitating customer value creation anddeveloping local 5G products leveraging JRC’s strengths inorder to establish a highly profitable business foundation.
Overseas, we are engaged in the expansive deployment ofprivate LTE, mainly in Europe and the United States. Nisshinbo
will further expand this business through the provisionof solutions leveraging JRC’s strengths, including systemintegrated LTE-BOX advances, wireless radio frequency andother local environment customizations, and the expansion anddiversification of applications meeting customer needs.

and operations management. In the digital business, we will

20.12
Marine systems

portable ultrasound business by strengthening marketing andtake on the challenge of new initiatives such as automaticallygenerating 3D spatial data from 2D map data and deploying it
as an online service. Furthermore, we will improve efficiency by
restructuring business processes and creating resources aimed
at strengthening profitability and expanding business.

Data Section

20.12

will expand our business domain by moving into the aviationtransformations. We will expand the high-value-added

Overview of Business Segments

as a drainage basin hydraulic control project. In addition, weon increasing profitability through business structure

How We Achieve Sustainability

overseas performed solidly, while a decrease in expenses due

automated manufacturing.

In the field of small and medium-sized vessels, we will strive

capabilities through the promotion of operational efficiencies

In marine systems, although sales declined because of
intensifying price competition affecting equipment for new-and increase orders for equipment retrofits and repair work.

reflecting needs for digital transformation, labor savings andSpecial Featurewhen disasters occur, as well as for the transmission of

expand our LCM business in the highly profitable aftermarket

we will expand the industrial equipment business domain,

How We Manage Our Businesswireless device and other backbone transmission systemprofitability in the commercial vessels segment, we will furtherof automotive power supply components. In mechatronics,
Where We’ve Come From,
Where We’re Going

Business Results and Strategy

problem-solving businesses, strengthen independent
development and leverage Group synergies to expand businessthrough expansion into new fields. In ICT, we will expand
to establish the foundation for digital business creation. In
components, our aim is to make Nisshinbo an indispensable
part of realizing a carbon-free society through the provision

53

Overview of Business Segments ̶ Micro Devices

Business Results and Strategy

Micro Devices

Summary of Financial Results for 2021

Medium- to Long-Term Business Strategy

In 2021, the Micro Devices business reported sales of ¥77,374

With the launch of Nisshinbo Micro Devices Inc., under the

million, up 26.6% year on year, and segment profit of ¥4,292

themes of“promotion of the electronic device business withmillion (an improvement of ¥8,186 million year on year).

a competitive advantage”and“expansion of the microwave

In mainstay electronics devices, the market recovery trend

business and profit generation,”Nisshinbo will combine
technologies held by the former New Japan Radio Co.,

continued in 2021, with plants commencing full production

Ltd., and the former Ricoh Electronic Devices Co., Ltd., andfrom the beginning of the year and remaining in operation

strengthen competitive standard products as a base businessall year. COVID-19 lockdowns across Southeast Asia caused

while attempting to develop signal processing and high-value-fragmentation in supply chains, which resulted in global

added power module products. Enhancing the quality of bothsupply shortages of parts and materials, mainly electronic

hardware and software, we will create new solutions with thecomponents. This resulted in parts shortages that led toaim of becoming an analog solutions provider that customers

lower production in the automotive and industrial equipment

can count on.

industries. However, automotive products centered on LSIs
such as ASSP and ASIC, and industrial equipment products
including power supply ICs, sensors, encoders and pin
drivers all performed well, buoyed by strong demand. In
lithium battery protection IC for mobile telephones, sales of
products such as GaAs products (e.g., antenna switches, LNAs)
and SAW filters were strong due to the ongoing switchoverfrom mobile phones to 5G base stations and automotive GNSS.
In consumer products, while the sale of conventional products
declined, overall sales remained at the same level as in thefacilitating the societal changes necessitated by COVID-19.
In microwave products, amid a swift increase in shipping

Nisshinbo Micro Devices Inc.
In the Micro Devices business, Nisshinbo has created newvalue in audio equipment, automotive and industrial devices,
ICT and other fields, drawing on its competitive advantages in
2022, a merger was concluded between the former New Japanof 2021, radar uptime increased, demand for replacement
magnetrons grew significantly and electron tube and radar
components performed favorably throughout the year. Orders
for satellite communications components, a key growth driver,and sensors made using microwave technologies were strong.
Despite being significantly hindered by parts shortages that
affected critical electronic components and connectors, weRadio Co., Ltd., and the former Ricoh Electronic Devices Co.,

communicated with customers from an early stage while

Ltd. Nisshinbo will combine the technologies held by both

encouraging advanced preparations and product schedulecompanies to create new, high-value-added products andsolutions businesses in the areas of automotive CASE, industrial

revisions in response to extended parts delivery times, enabling

The signal processing IC includes sensor product lines thatwill expand markets for operational amplifiers and IoT. We
will attempt to combine signal processing ICs with microwave
sensors while aiming to provide modules and even solutions
from conventional single IC provision. With EM, a power
control system IC required for a wide range of devices, we
aim to develop high-value-added power module products
such as PMIC and IPM for power supply control system ICs
amid rising demands for low power consumption and otherhighly precise functions. The primary target markets areautomotive, industrial equipment and consumer products. We
will strengthen the planning and development of customeroriented, high-performance ASIC and ASSP products forautomotive and industrial equipment applications. In consumer
products, we will accelerate the planning and development of
products including touchless sensors that facilitate the societal
changes necessitated by COVID-19, as well as in new productareas such as beauty equipment. Furthermore, by expanding
the ratio of products for automotive and industrial equipment,
we aim to establish a stable business portfolio.

us to maintain solid sales.

equipment and healthcare.

Related SDGs

(millions of yen)

20.12

21.12

New Japan Radio

41,931

51,072（former Ricoh Electronic
Devices）

20,515

Segment Profit(millions of yen)

20.12

21.12

New Japan Radio(2,427)2,864

28,014（former Ricoh Electronic
Devices）(1,205)

1,698

(263)

(271)

(3,895)

4,292

P.44

Outside Director Discussion with the Presidentof Nisshinbo Micro Devices

Eliminations, etc.*(1,306)(1,713)Eliminations, etc.*

P.55

Business Results and Strategy

Total

61,141

77,374

Total

P.56

Key Products*Includes goodwill amortization and revisions to retirement benefits

Data Section

54

Net Sales

Overview of Business Segments

analog semiconductors and microwave technologies. In January

due to rapidly recovering market conditions at the beginningand energy management (EM).

How We Achieve Sustainability

previous fiscal year due to Nisshinbo’s provision of products

In electronic devices, we will focus on signal processing (SP)Special Featurecommunication-related products, in addition to solid sales ofElectronic Devices

How We Manage Our Businessthat began in the fourth quarter of the previous fiscal year

Where We’ve Come From,
Where We’re Going

Overview of Business Segments

55

Overview of Business Segments ̶ Micro Devices

In terms of production, we will engage in additional

In satellite communication components, amid ongoingdifficulties in procuring parts, we will strive to ensure stable

Regarding the wafer process (pre-process), Nisshinbo willproduction of transmitters and receivers compatible with VSAT

mass-produce 0.18-um CDMOS achieving miniaturization with(small ground station) system terminals, which are performinga high withstand voltage process at the Yashiro Plant (Hyogo

well. At the same time, we will upgrade existing productPrefecture), while manufacturing in-house a portion of newmodels, develop high-power transmitters for base stations

products that are outsourced. In terms of the assembly process

anticipated to have high added value and develop new(post-process), we will transfer the testing and assembly ofmarkets.

products manufactured at the Yashiro Plant to manufacturing
the use of low-cost outsourced semiconductor assembly

integrated with electronic device packaging and modularizationand testing (OSAT) overseas. In addition, we will consider

technologies, as well as sensor technologies and signal

discontinuing the production of SAW filters at our products’

processing combined with other sensors to accelerate

end of life (EOL). With respect to materials, we will promoteadvances in smart sensor technologies that stably generate thethe replacement of gold wires used in post-processing withrequired data. We will also enhance our technical capabilities

copper wires. Regarding lead frames, for which there is a

to support the design and development of systems using

shrinking number of suppliers, we will evaluate the quality

sensors and respond to a wide range of customer requests.

In terms of sales, we will strive to further improve customer

With regard to satellite component and sensor products,
as the impact from sensor part supply shortages is expected
to become increasingly severe, we will attempt to realize
stable production with a parts procurement strategy focused

development that incorporates new projects and customer

on market expansion, while utilizing our Thai manufacturingneeds while demonstrating integrated synergies such as cross-subsidiary to strengthen price competitiveness, acquire a wide

selling. In addition, we will strengthen the production andrange of customers and respond to production increases.

sales matching system through fixed order manufacturing
management, reduce inventories and strive to maintain

Related SDGs

which are key components in automobile brake systems. Our strategy in the Automobile Brakes business
How We Achieve Sustainability

is to address the specific requirements of each market and customer with three businesses—Nisshinbo

Microwave Products

Brake, TMD Friction Group and Saeron Group—aiming to meet global automaker needs for optimum parts

For microwave products, electron tubes and radar components,

procurement as the world’s leading friction materials company.

Nisshinbo will make an effort to increase profitability by
improving production efficiency while responding to ongoing

Business Results and Strategy

increases in demand. We will also strengthen sales of electron
tubes and electron guns for Linac.

Electronic devices

Microwave
products

Industrial equipment products

The number of ICs per vehicle continues

Nisshinbo has a diverse lineup ofSatellite communication systemcomponents

to increase amid the shift to vehicle

products to meet customers’needs:

electrification and advances in autonomous

operational amplifiers that play a key

VSATs* are satellite ground stations

driving technology. ICs are now neededrole in improving the sensing precision

for a growing array of applications, fromof encoders, which support movement

car audio to power control units, which

in industrial robots; PMICs that support

support basic vehicle functions, electric

stable, low-noise operation of various

power-assisted steering and battery

industrial equipment; and analog

management systems, as well as sensors

front-end ICs that optimally integratethat are integral to parking assist systems,

industrial equipment functions.

collision avoidance and prevention systems

that play a crucial role in satellite-basedInternet connectivity, data transmission
and telephony. New Japan Radio isfitted with friction materials that have a copper content of

In 2021, the Automobile Brakes business reported sales ofcome into force in 2025 further reducing the limit on copper¥138,295 million, up 20.4% year on year, and segment profit

content to less than 0.5%, new orders are steadily increasingof ¥3,558 million (an improvement of ¥5,847 million comparedfor copper-less (copper content less than 5%) and copper-

with the previous fiscal year).

free (less than 0.5%) friction materials from Nisshinbo Brake

more than 5%. Amid movements toward stricter rules that will

Global automobile production, which significantly affects theInc. The increased market share driven by orders for copper-

Automobile Brakes business, recovered substantially in the first

free friction materials contributed significantly to higher sales

half of 2021. However, in the second half, automakers werein Japan and at subsidiaries in the United States and China.

forced to slash production due to supply chain disruptions,

Investments in production equipment for copper-free materials

including difficulties in sourcing parts from Southeast Asia,

are proceeding as planned. And although sales at our Southand semiconductor shortages. For these reasons, the full-year

Korean subsidiary remained at the same level as the previous

recovery was only about 5% compared with the previous year.

fiscal year due to the impact of curtailed production by major

In addition, the soaring cost of steel and other raw materials

customers, profits increased due to cost reductions and otherstarting in the second quarter of 2021 exerted downward

efforts.

pressure on profits.

The TMD Group, for which Europe is its main market,

Under these conditions, at Nisshinbo Brake Inc., in addition

expanded market share and increased sales by creating afor VSAT and one of only a handful ofto robust sales in Japan and at the subsidiary in Thailand, sales

suppliers worldwide. It has the top sharestrategic supply system for aftermarket friction materials

and profits were higher at the China subsidiary, where the mainamid economic stagnation caused by COVID-19. In addition,customers are Japanese auto manufacturers enjoying strong

significant progress has been made on business revitalization

sales. In the United States, effective from 2021, environmental

plans, enabling a return to profitability.

Japan’
s only supplier of key components

in the global market.
*Very Small Aperture Terminals

regulations prohibit the sale of friction materials or vehicles

57

Data Section

Automotive products

Summary of Financial Results for 2021

Overview of Business Segments

Key Products

56

Nisshinbo Brake Inc./TMD Friction Group S.A.
Nisshinbo is a global supplier with world-class development capabilities in the field of friction materials,

appropriate inventories.

Special Featureawareness and satisfaction through product planning andand autonomous driving.

How We Manage Our Businessmillimeter-wave band (60 GHz) products in 2022 that will be

products satisfying adoption criteria from multiple companies.

Automobile Brakes

In the microwave sensor product line, we will launch

subsidiaries in Saga Prefecture and Thailand, while expandingof products made in South Korea and China, then purchase

Overview of Business Segments

Where We’ve Come From,
Where We’re Going

reductions in outsourcing costs to further improve profitability.

Overview of Business Segments ̶ Automobile Brakes

assembled product must be durable enough to withstand long-

Market Environment and Business Strategy

with electronically controlled regenerative braking. In addition,

Semiconductor shortages that arose last year and supply
chain disruptions brought about by the pandemic continued
into 2022, with manufacturers facing frequent shutdowns.
That being said, demand for automobiles has not entirely
vanished, and we expect an increase in sales of Nisshinbo
Brake assembled products when demand returns. Regarding
increasing in the United States and other countries, full-scale
production is slated to launch soon. As many lineups havealready been adopted by the world’s best-selling models,
this will enable Nisshinbo to capitalize on a major growth
opportunity.
At the same time, we will attempt to increase the market
share of the TMD Group aftermarket business through strategic
production facility enhancements. Business revitalizationplans are on track, with the integration of assembled parts
manufacturing at the Essen plant in Germany linked towill continue to enhance cost competitiveness through thepromotion of optimized local production utilizing the Romania
plant, among other efforts.
Furthermore, as a measure launched in 2021 aimed at
mitigating the impact of the soaring cost of steel and otherraw materials, we are passing on cost increases through sales
starting with aftermarket products developed by the TMD
Group.

vibration suppression during braking. Anticipating changes
in demand for friction materials due to the way automobiles
will be used going forward, Nisshinbo is focusing efforts on

Precision
Instruments

the research and development of products that are highly
compatible with electronically controlled braking. We will also
promote and adopt technological developments from various
fields aimed at reducing greenhouse gases to proactively
engage in the creation of a sustainable society. In addition,
we have commenced research regarding vehicle undercarriage
sensing in collaboration with Group companies focused on the

Nisshinbo Mechatronics Inc.
Utilizing various areas of expertise accumulated over more than 70 years, this segment is focused on

future of mobility in society. We will promote our value as aprecision metal parts processing for the automotive sector and parts molding and processing for thepartner trusted by customers. In these product development

automotive and home appliance sectors. The segment also makes customized production equipment toinitiatives, we are transitioning to data-driven systems able

meet the specific needs of customers. We work closely with subsidiary Nanbu Plastics Co., Ltd., to develop

to effectively utilize the culmination of our experience andthese businesses globally, centered on Asia.

knowledge and promoting the digitized representation of
events by combining advanced analysis methods and CAE
analysis to create processes that facilitate more efficient andaccurate proposals. We are moving quickly forward with plansto optimize operations using production controls incorporating
ICT into the manufacturing process; visualize equipment
operating status and equipment prognosis and predictive
maintenance; control quality using AI to analyze manufacturing
and inspection data; and use RPA to review operational
efficiency.

Related SDGs

Business Results and Strategy
Summary of Financial Results for 2021

Medium- to Long-Term Business Strategy

In 2021, the Precision Instruments business reported sales ofIn the Precision Instruments business, we will enhance production¥55,769 million, up 8.5% year on year, and segment profit of ¥716

systems at all plants with a focus on products for which demand

million (an improvement of ¥1,663 million compared with theis expected to grow in the future, including precision parts andprevious fiscal year).

lenses for automobile headlamps and medical molding products.
At the same time, we will move forward with manufacturing site

semiconductor supply shortages in automotive-related industries,

consolidation and other business restructuring efforts, identifying

Improvement activities under way at sites throughout theas well as curtailed production by auto manufacturers, North

unprofitable operations and products to further strengthen ourworld have been proactively implemented in all regions andAmerican demand was strong for automotive exhaust valves

operating base.

levels despite COVID-19, resulting in achievements that

manufactured by Nisshinbo Precision Instrument & Machinery

Plans are under way for electrification and autonomous

include increased profitability and quality through equipment

Hiroshima Corp. The transfer and concentration of MK100

driving‒related next-generation vehicles and new brakes at

automation and image testing. Improvement activity meetings,

electronic brake system (EBS) valve block production to Nisshinbo-

finished vehicle manufacturers. HVs, EVs and other electric

which are held regularly to facilitate reciprocal communication

Continental Precision Machining (Yangzhou) Co., Ltd., has enabled

vehicles accumulate energy when braking by using an electricacross the Group and share knowledge, have been conducted

Nisshinbo to meet growing customer demand for this product anddrive system that reduces wear on conventional mechanicalonline during the pandemic to devise ways of perpetuating theincrease productivity, driving sales and profits higher. In March

brake friction materials, thus we expect demand for repair

kaizen (improvement) culture.

2021, Nisshinbo launched mass production of next-generation

Improvement Activities

Toward the Spread of Electrification andAutonomous Driving“MKC1”EBS valve blocks supporting vehicle electrification andparts to decrease in the long run. On the other hand, theautonomous driving, and we are already preparing for mass
production of the next-generation“MKC2,”an even smaller andlighter version of this product.
In molding products for automobiles and air-conditioning

Net Sales
20.12

21.12

44,05749,048Nisshinbo Brake(millions of yen)

20.12

21.12

788

3,202

conditioners equipped with ventilation functions, leading toincreased customer orders for home appliances, mainly in Japanand China. At Nisshinbo Mechatronics (Thailand) Ltd., despite
production delays caused by a shortage of wire harnesses forhome appliance customers and semiconductors for automotive

TMD

75,106

94,072

TMD(3,219)366

customers, overall demand was headed toward a recovery. Within
the Nanbu Plastics Group, production at the Nanbu Plastics

Eliminations, etc.*
Total(4,337)
114,827*Including amortization of intangible fixed assets at TMD

58(4,825)
138,295

Eliminations, etc.*
Total

142
(2,289)

(10)
3,558

Indonesian subsidiary was discontinued in an effort to reorganize
this unprofitable business. As a result of these factors, slumping
demand recovered in automotive, home appliance, housing and

The Nisshinbo Mechatronics Inc. molding products business andNanbu Plastics Co., Ltd., have production bases in Japan and Asia
(Thailand, China, India, the Philippines and Indonesia). We willcontinue to optimize production bases to efficiently capture global
demand leading to the realization of higher profits. In the molding
products business, we are implementing strict cost management
to identify unprofitable products and intensify cost-reduction
activities, advancing reasonably priced proposals to customers to
improve profitability.
Following the discontinuation of production at its Indonesiansubsidiary, the Nanbu Plastics Group is reorganizing business at
its subsidiary in Guangzhou, China, in preparation for the transfer
of production. Kyushu Nanbu Plastics Co., Ltd., is also revisingproduction systems in response to changes in the businessenvironment, including policy decisions by major clients to shift
production in-house and shrinking demand for vapor deposition
components caused by the switch to LED automobile headlamps.
The Nanbu Plastics Group will continue to identify and dispose of
unprofitable businesses, allocating management resources to highvalue-added businesses and improving profitability.

medical applications, leading to higher sales and profits.

59

Data Section

Nisshinbo Brake(millions of yen)equipment, the pandemic drove up demand for high-end air

Segment Profit

Business/Product Identification and Closeout

Overview of Business Segments

Although precision parts for automobiles were affected by

How We Achieve Sustainability

prices. To this end, we are engaged in tenacious negotiations,demands for high-quality products with excellent noise andSpecial Featurefacilitating efficient production and improved profitability. We

in response to the enhanced silence of the vehicle, there are

Overview of Business Segments

How We Manage Our Businesshigh-performance copper-free products, for which orders areterm use, realizing stable braking force through coordination

Where We’ve Come From,
Where We’re Going

Medium- to Long-Term Business Strategy

Overview of Business Segments ̶ Precision Instruments

In the precision parts business, with regard to automotive EBS
valve blocks for which customer demand is expected to rise in
the future, we will attempt to improve capacity utilization rates
at Nisshinbo-Continental Precision Machining (Yangzhou) Co.,
Ltd., where production is concentrated, to focus efforts on the
production and sales of automotive EBS valve blocks. In addition,
the market for two- and four-wheeled vehicles in India is expected
to grow, and in line with the Indian government’s national
and production), Nisshinbo plans to launch a joint venture with
Continental in India by the end of 2022 and will proceed withpreparations for the start of mass production in 2023.

through the development and launch of high-value-added fans.
Regarding automobile headlamp lenses for Chinese customers, theproduction of which was transferred from Nanbu Plastics, we willattempt to further increase orders by expanding production while
India Private Limited, as the air-conditioner market in India is
expected to expand, we will make the capital investments
necessary to capture demand and expand market share.
The Nanbu Plastics Group will focus on highly profitablelenses within automotive applications, capturing new orders andimplementing sales promotion measures for high-value-added PES(aspherical) lenses.
Medical applications are another promising growth field for

Molding Products Business Expansion Measures
In the Nisshinbo Mechatronics molding products business, as new

to the Nisshinbo Group Fujieda site where it was set up andwill strengthen proposal capabilities leading to new orders. We
will promote the development of new, high-value-added products
such as antifouling fans and small cooling fans and maintain efforts

Nanbu Plastics medical business (Yoshida site) was relocatedsubsequently commenced operations. We will implement

Nisshinbo Chemical Inc.
Drawing on a broad base of expertise and intellectual property in the chemical field, thisRelated SDGs

segment is working to develop products that help protect the environment and makelife more comfortable. Our environment- and energy-related products include bipolar
plates for fuel cells and Carbodilite, a high-performance plastic material that increases

production equipment and capacity enhancements, and introduce

the durability and chemical resistance of biodegradable plastics and water-based

automation, labor saving and other production efficiency

resins, which have minimal environmental impact. We are prioritizing the investment of

improvements to further expand orders.

management resources in these promising growth areas.
Special Featuretargeting product launch.

Chemicals

strengthening quality control systems. At Nisshinbo Mechatronics

the Precision Instruments business. In September 2021, theinquiries for home appliance and office equipment fans rise, we

Overview of Business Segments

How We Manage Our Business“Make in India”policy (measures promoting local procurementwith motor manufacturers achieving product differentiation

Where We’ve Come From,
Where We’re Going

Precision Parts Business Expansion Measures

At Nisshinbo Mechatronics (Thailand) Ltd., we will enhance theBusiness Results and Strategy

price competitiveness of existing products through automation andlabor saving within production processes, further increase orders
through the development and launch of high-value-added fans,

Summary of Financial Results for 2021

and attempt to recover sales and profits to pre-pandemic levels.
At Nisshinbo Mechatronics (Shanghai) Co., Ltd., we will maintain

Sales and profits of glass-like carbon products increased due toa full-scale recovery in demand for semiconductor manufacturing

In 2021, the Chemicals business reported sales of ¥11,083 million, up

equipment parts and an increase in orders. In the first half of thewhile targeting higher profitability through joint developments

15.7% year on year, and segment profit of ¥2,054 million, up 13.4%.

fiscal year, although the market continued to stagnate due to

In 2021, bipolar plates for fuel cells from the In-vehicle

Net Sales(millions of yen)

20.12
Precision parts

14,387

Segment Profit

21.12
15,891(millions of yen)

20.12
Precision parts

(78)

21.12
223

40,66944,038

Molding products

(38)

1,306

Eliminations, etc.

(3,637)(4,161)Eliminations, etc.

(832)

(814)

Total

51,41955,769

Total

(948)

716

Key Products

and cloud services in the semiconductor market, while

into the Chemicals business. Amid a boom in global fuelsemiconductor manufacturing equipment demand also expanded

cell development, there were many inquiries regarding thedramatically due to supply chain reorganization efforts triggered

development and trial production of bipolar plates, which are

by semiconductor frictions between the United States and China,

being developed for high-durability applications and are superior

all of which resulted in increased orders of parts for capital

to competing materials in terms of light weight and durability. As

investment.

a result, sales and profits rose due to increased orders for home
appliance and fixed- and in-vehicle prototype products.
In functional materials, despite the impact of soaring chemical
raw material and transportation costs, sales and profits increased
due to higher sales of modifiers for waterborne cross-linking agentsand pulverized modifier for biodegradable plastics amid a growing

Attracting attention as technologies for realizing carbon neutrality,
demand is rising for fixed hydrogen cells and fuel cells as powerhome appliances and PC-related products, for which demand

supplies for use during emergency and normal operations.
Nisshinbo has received many global inquiries regarding ourrecovery in demand for automobile parts and building materials

bipolar plates. As we expect to exceed current production

contributed to higher sales.

capacity in 2023, the decision was made to expand the plant andinstall a new line to meet rapidly growing demand with increased

wastewater treatment were affected by fewer orders in the domestic

capacity. In-vehicle applications, particularly those for buses andmarket amid skyrocketing raw material costs, movements toward atrucks, are being developed throughout the world. Having engaged

post-pandemic market recovery led to higher orders for refrigeration/

in development with several leading manufacturers until now,

freezing equipment and undiluted solutions for civil engineering,

Nisshinbo is targeting commercialization in response to strong

which are used in prefabricated refrigerators, clean rooms, exteriordemand for bus and truck prototypes. In November 2021, wewall materials and tunnel repair backfill injection work, all of which

acquired IATF16949, a required certification for automobile parts

lifted sales and profits higher. Orders for cold storage and urethane

factories. We intend to expand business through further productblocks used in automotive design models were also brisk.

developments, improved productivity and enhanced quality.

61

Data Section

60

Fans for residential and commercial air conditioners

Bipolar Plates for Fuel Cells

pollution. In addition to robust sales of food packaging materials,
expanded under restrictions on movement due to COVID-19, a

Automotive headlight components

Enhanced Capacity and Accelerated Development ofenvironmental awareness of problems such as marine microplastic

In thermal insulation products, although bio-carriers for

Automotive EBS valve block

Medium- to Long-Term Business Strategy

Overview of Business Segments

Molding products

COVID-19, demand grew on the expansion of 5G communications

Development Division of Nisshinbo Holdings were integrated

How We Achieve Sustainability

efforts to expand orders for Eco Cross® and Eco Blade Turbo®,

Overview of Business Segments ̶ Chemicals

Chinese market leveraging the advantages of Japanese brandto Environmental Issues

power and strong technological development capabilities. At theFaced with environmental issues such as ocean plastic pollution,market needs, acquiring orders in the private wastewater field andglobal warming and air pollution caused by volatile organic
compounds (VOCs), amid growing global environmental awareness,there are demands for the use of biodegradable resins and waterbased paints. Demand for Carbodilite products is growing as it isa material that is indispensable for the spread of biodegradable
plastics that contribute to resolving these issues, as well as watermaterials. Nisshinbo is accelerating product development andsales channel expansion, mainly targeting environmentally friendly
products. We will accelerate sales, specifically in the rapidly

expanding into the water purification tank market.
In addition, regarding developments in infrastructure safetymeasures, we will cultivate high-value-added products through newdevelopments that do not rely on insulation to expand our businessdomains. Despite global difficulties in procuring raw materials,
Nisshinbo will continue to develop alternative products with anemphasis on ensuring a stable supply of products.

Long-Term Growth Expected in Glass-Like Carbon Products

growing environmental and energy markets where Carbodilite is

Although volatility will continue in the market for semiconductors,

undeveloped. In Japan, Europe and the United States, there is rising

the main application for glass-like carbon products, the spreaddemand for advanced performance Carbodilite. By developing andof CASE and the Metaverse are expected to drive long-term

launching high-value-added products that meet these needs, wegrowth. Amid changes among major players, including the rapid

will expand our sales channels.

advance of fabless manufacturers and foundries, and insourcing
in China, we are strengthening collaborations with semiconductor

Differentiating and Increasing the Added Value of

manufacturing equipment manufacturers and component

In thermal insulation products, we will work to further expand

will focus on the advanced semiconductor segment, which is thebusiness by maintaining and expanding civil engineering basedriver of capital investments in semiconductors, meet demandsolutions and hard blocks constituting core products in the heat

for advanced materials and aim for business growth by providing

insulation field, as well as by launching highly flame-retardant

key materials that support the mass production of miniaturization

products. In the anti-vibration field, to grow railway anti-vibration

processes. We will continue to increase the production capacity ofmaterials into non-form pillars, we will work to increase orders

glassy carbon products, for which strong demand is expected, andfor products that enable the extension of track maintenance work

develop new products compatible with advanced semiconductor

cycles, as well as orders for large overseas properties. In the water

miniaturization.

(millions of yen)in the fields of spinning, weaving, processing and sewing, and today possesses some of the world’s mostadvanced technologies in product development and production. Nisshinbo is currently working to increase
global sales of the APOLLOCOT brand by mobilizing its sophisticated textile processing technologies.

(millions of yen)

Medium- to Long-Term Business Strategy

In 2021, the Textiles business reported sales of ¥34,479 million,

Market Environment and Business Strategy

up 1.5% year on year, and a segment loss of ¥1,023 million (a21.12

Environment and energyrelated products*

1,630

1,697

1,492

1,730

Carbon products, etc.

182

358

Eliminations, etc.

(186)

(248)

Eliminations, etc.

(1)

(1)

Total

1,811

*Fuel cell bipolar plates, Carbodilite, insulation materials

2,054

fell sharply due to abrupt inventory adjustments at the distribution
stage. At TOKYO SHIRTS CO., LTD., ebbing demand for businessshirts driven by the spread of telework and a decrease in store
traffic and temporary store closures due to the declaration andexpansion of a state of emergency resulted in sluggish physicalstore sales, and although online sales increased, plan targets were
not achieved. In uniforms, working apparel inventory adjustments
have concluded, with market conditions recovering from thesecond half of the fiscal year, whereas sales increased in line withrobust sales to food processing plants and the medical field, where
demand was firm. In developed materials, because the market
shrank considerably, sales of nonwoven fabrics for cosmetic

Key Products

sundries and spandex yarns for legwear declined significantly amid
lifestyle changes brought about by the impact of voluntary banson leaving home, and although U.S.-bound exports of MOBILON
materials was lower than in the previous fiscal year.

Bipolar plates for fuel cells

62

Carbodilite

Bio-carriers: APG

consumption, was greatly affected by changes in lifestyle andconsumption behaviors such as voluntary bans on leaving home
and the spread of telework due to COVID-19. However, there are
significant business opportunities for services and products that
support the online sales of apparel and casual business styles, aswell as environmental products that embody the SDGs centeredon natural materials. In addition, as the world’s population is still
growing, and economic growth is robust in Asia, the global textiles
market is expected to expand further.
In this market environment, the Textiles business will proactively
promote the“conversion to sustainable textiles businesses.”
We will focus resources on the development of highly functional
products centered on the environment, health and comfort,
while rapidly expanding global business leveraging Nisshinbo’senvironmentally friendly manufacturing approach in an attempt torebuild business profitability.

Rebuilding Business Profitability
Data Section

tape for medical face masks were solid, performance in developed

The Textiles business, which is directly linked to apparel

Overview of Business Segments

20.12

Carbon products, etc.

11,083

Summary of Financial Results for 2021

due to the spread of COVID-19, as sales of wrinkle-free shirt fabricSegment Profit

21.12
9,601

Business Results and Strategy

In the shirts segment, demand for business apparel declined

8,271

9,577

with its state-of-the-art technologies and high quality. Nisshinbo subsequently expanded its business globally

deterioration of ¥210 million year on year).

Environment and energyrelated products*

Total

Since its founding in 1907 as Nisshin Cotton Spinning Co., Ltd., Nisshinbo has led the Japanese textile industry

development and industrial equipment supplies. In particular, wetreatment field, we will promote a differentiation strategy in the

20.12

Related SDGs

How We Achieve Sustainability

manufacturers, both of which play vital roles in technologicalNisshinbo Textile Inc.

Special Feature

Thermal Insulation Products

Net Sales

TextilesHow We Manage Our Businessbased paints and coating agents and high-performance electronicsame time, in Japan, we will develop new products that meet

Overview of Business Segments

Where We’ve Come From,
Where We’re Going

Expanding Carbodilite Sales, Contributing Solutions

In anticipation of market needs, Nisshinbo aims to maintain andOverseas, our Indonesian subsidiary saw a decrease in

expand its top market share by proactively launching products

production resulting from curtailed social activities due tocentered on the environment, health and comfort. We will also

COVID-19, while sales to Japan and other countries and regions

rebuild profitability by developing next-generation products andwere sluggish, with sales and losses at about the same level as inreducing raw material and other manufacturing costs. In thethe previous year. At our Brazilian subsidiary, we were able to pass

shirts segment, we will attempt to expand market share throughon increases in raw cotton costs, while sales of differentiated yarn

the rapid development and launch of next-generation products

made using new spinning equipment were favorable, resulting incontributing to new functionality for APOLLOCOT non-iron fabric,higher sales and profits.

which helps reduce electricity consumption.

63

Overview of Business Segments ̶ Textiles

sundries, spandex yarns for legwear and elastomer businessmaterials. We will also take on challenges including the“shirt

to Market Changes
At TOKYO SHIRTS CO., LTD., we will reshuffle physical stores andpromote DX to realize business transformations targeting a profit
structure led by online-merge-offline (OMO) businesses. Viewing thisrebirth project”and other circular economy business formats.

Cultivating Environmentally Themed New Business Domains

as an opportunity to reduce reliance on China and diversify risks

In terms of new environmental businesses, we are engaged in a

across Asia, Nisshinbo will leverage the advantages of Indonesian

shirt rebirth project and a cellulose nanofiber utilization project.

integrated materials to accelerate global business expansion.

Overview of Business Segments

Where We’ve Come From,
Where We’re Going

Business Transformation in Response

Real Estate

The shirt rebirth project involves joint research conductedby the Nisshinbo Holdings Business Development Division and

How We Manage Our Business

Developing Sustainable Textile Businesses in the

Shinshu University. Unused cotton shirts are collected and cut up,

Environment and Healthcare Domains

the cotton is dissolved and converted into recycled fibers, and the

Nisshinbo will promote the development and launch of sustainable

development of practical applications launched in 2021 with the

product groups centered on eco-friendly, healthy and comfortable

goal of commencing trial production in 2023.

fibers are used to make a new shirt. The full-scale research andNisshinbo Holdings Inc.

products. At the same time, we will strive to break away from the

The cellulose nanofiber utilization project, which is being

use of coal fuel as a manufacturing environment initiative, including

promoted as a next-generation environmental product, involves

Nisshinbo’s Real Estate business redevelops properties that have become vacant because of businessproactive efforts to reduce CO2 emissions and water consumption,

converting surplus such as cuttings and cotton waste generated inconverting to eco-friendly plants that comply with environmental

changes at Group companies. Income from those activities is used to fund the Group’s growth strategy,

the manufacturing process into nanofibers, recompacting them andregulations.

utilizing them for various purposes. Soaps that use the cellulose

such as launching new businesses and expanding global operations. Income is generated from two main

Furthermore, we will promote the use of more environmentally

nanofibers currently under development as scrubbing agents aim
to contribute to solving the problem of marine microplastics.

Net Sales

Segment Profit

sources—property leasing and the sale of housing lots. Nisshinbo has actively developed the housing lot
sales business since 2009, when the Group moved to a holding and operating company structure. The

Special Feature

friendly and recyclable nonwoven fabrics used for cosmetic

Related SDGs

Group’
s domestic real estate portfolio includes many land and property sites with excellent locations,generating strong earnings for the Real Estate business.

Japan

20.12

21.12

29,51427,651

14,166

17,075

Eliminations, etc.

(9,723)(10,248)

Total

33,957

34,479Japan
Overseas

20.12

21.12

(842)

(1,269)(31)

Eliminations, etc.
Total

(millions of yen)

213

61

34

(813)

(1,023)Business Results and Strategy
Summary of Financial Results for 2021
In 2021, the Real Estate business reported sales of ¥15,584
million, down 23.2% year on year, and segment profit of ¥9,389
million, down 18.4%.
In the housing lot sales business, profitability remained at highlevels, driven by sales of condominiums in Mitaka, Tokyo, and sales ofland in Kitajima, Tokushima Prefecture; Higashiomi, Shiga Prefecture;
and Okazaki, Aichi Prefecture. However, sales and profits declined
overall as more Mitaka condominiums were sold in the previous fiscal
year. At the same time, leasing operations in the property leasing
business were firm for land, office buildings and commercial facilities.

Medium- to Long-Term Business Strategy
In 2022, we expect to continue securing high profits as in the

Mobilon/Elastomer

Our Apollocot shirts, developed with

Oikos nonwoven fabrics employ

Mobilon is a type of spandex (polyurethane

the full capabilities of Nisshinbo Textile

the spunlace manufacturing

elastic fiber) developed by Nisshinbo Textile using

Inc., have been highly appraised bymethod, which uses water jets

proprietary technologies. Leveraging its soft touchcustomers as next-generation non-to finish fibers in a sheet format.

when stretched and ability to maintain shape, theiron shirts, and the technology is being

These extremely safe andrange of applications continues to expand into a

extended to other items as well, suchhygienic ecological materials arevariety of categories including clothing and materials.

as handkerchiefs, business knit shirts

used in a wide range of fields,

Our elastomer is a thermoplastic polyurethane materialand cotton business pants.

from cosmetics and householdalso developed using proprietary technologies. Thanks tosundries to industrial applications.

its excellent elasticity, flexibility and durability, it is usedwidely in apparel, face masks and other industrial materials.

64

Regarding the redevelopment of employee housing in Nishiarai(Tokyo) as rental condominiums, construction of Phase 1 (50 units)
was completed and leasing has begun, with Phase 2 (149 units)leasing slated to commence in April 2024.
We have commenced redevelopment of the former Notogawa
factory site (Shiga Prefecture) as 129 condominium units, withplans to launch sales in 2023.
In terms of new projects, we plan to sell the site of the former
Hamamatsu factory (Shizuoka Prefecture) for use as a commercial
facility in 2022–2023.
Furthermore, we are moving forward with plans to construct 50
rental condominium units on the site of the former Japan Radiobusiness were firm for land, office buildings, commercial facilities

Co., Ltd., Seifu Dormitory (Tokyo). Development and construction

and other properties, while sales of land and other properties arework will begin in 2022, with leasing scheduled to start in 2024.
In addition, at the Shibaura Nissin Building (Tokyo) owned by

The Real Estate business will continue to fulfill its role as a

Nisshinbo Urban Development Co., Ltd., we are moving forward

source of funds to help Nisshinbo attain its management targets

with construction plans for rental condominiums in collaboration

by effectively utilizing the real estate assets of the whole Group.

with a major housing manufacturer.

Net Sales

Segment Profit(millions of yen)

Data Section

Oikos fabric

medical and welfare facilities.

previous fiscal year. Leasing operations in the property leasing

ongoing in the housing lot sales business.

Non-Iron Shirts Apollocot

For the redevelopment of the former Miai Plant site (Aichi
Prefecture), we will continue sales of all 357 detached homes andOverview of Business Segments

Key Products

We plan to continue generating stable earnings by focusing on
the projects shown below.

How We Achieve Sustainability

Overseas(millions of yen)(millions of yen)

20.12

21.12

20.12

21.12

20,27915,584

11,512

9,389

65

Financials

Where We’ve Come From,
Where We’re Going

Eleven-Year Summary
2014.032015.032016.032017.032018.032018.122019.122020.122021.12¥379,340¥450,693¥494,350¥523,758¥533,989¥527,274¥512,048¥416,221¥509,661¥457,051¥510,643

169,907

175,308

187,743

209,116

205,368

190,852

193,621

̶

̶

̶

̶

Wireless and Communications

̶

̶

̶

̶

̶

̶

̶

90,427

152,213

144,312155,085

Micro Devices

̶

̶

̶

̶

̶

̶

̶

53,77765,286

61,141

77,374

Automobile Brakes

47,450118,849

148,699

161,887

165,037

146,062

154,205

135,008

131,338

114,827

138,295

Precision Instruments

25,191

24,52028,65528,60829,52560,68764,91862,21965,42951,41955,769Chemicals

8,258

8,150

8,810

8,138

8,285

9,483

11,285

8,173

9,391

9,577

11,083

Textiles

60,96454,73654,63051,07360,12755,84254,64043,66049,50533,957

34,479Papers30,22030,524

31,686

31,28032,58532,648

̶

̶

̶

̶

̶

Real Estate

9,082

15,367

10,567

9,246

8,358

8,084

8,406

4,237

11,655

20,27915,584

Other Businesses

28,26823,23923,56024,41024,704

23,61624,97318,72024,844

21,53922,974

Operating Income (Loss)

4,170

13,394

13,175

13,744

12,617

4,890

15,086(2,506)

6,482

1,248

21,789Net Income (Loss) Attributable to Owners of theCompany

9,416

6,418

9,012

13,694

10,776

3,575

26,352(7,183)(6,604)

13,541

24,817

Equity¥213,751¥242,623¥276,865¥306,938¥284,472¥275,753¥290,434¥264,849¥252,536¥242,068¥272,632

Total Assets

534,584

551,933

611,311

678,486

651,793646,288

651,959622,381

617,528

581,204

604,799

Capital Expenditures

15,705

20,12319,89636,90922,86230,50530,10327,19932,38725,87026,482

Depreciation and Amortization

14,55018,96921,48623,111

22,571

22,264

22,183

19,816

24,955

22,12523,165Net Cash Provided by Operating Activities¥ 12,974¥ 34,095¥ 26,075¥ 37,120¥ 39,566¥ 26,768¥ 32,415¥ 15,495¥ 26,249¥ 42,590¥ 39,828

Net Cash Provided by (Used in) Investing Activities(57,861)(10,973)(19,862)(21,271)(22,793)(31,429)(1,798)(20,723)(21,759)(6,321)(16,767)

Net Cash Provided by (Used in) Financing Activities

16,835(24,073)(2,321)(6,238)(9,044)

3,595(34,785)

11,936(10,065)(24,230)(30,819)

53.83

¥

22.52

¥ 160.59¥ (43.26)¥ (39.45)

¥

81.38

¥ 149.08

Operating Results (millions of yen)
Net Sales
Electronics

Special Feature

2013.03

How We Manage Our Business2012.03

Financial Position (millions of yen)¥

Shareholders’Equity

1,063.19

1,198.67

1,369.78

1,634.07

1,472.26

1,444.94

1,659.29

1,457.26

1,431.35

1,375.19

1,556.01

15.00

15.00

15.00

15.00

30.00

30.00

30.00

30.00

30.00

30.00

30.00

Shareholders’Equity Ratio

34.7

37.9

39.1

38.2

35.9

35.5

41.2

40.1

38.6

39.4

42.8

Return on Assets (ROA)

1.9

1.2

1.5

2.1

1.6

0.6

4.1

(1.1)

(1.1)

2.3

4.2

Return on Equity (ROE)

5.1

3.2

4.0

5.5

4.4

1.5

10.6

(2.8)

(2.7)

5.8

10.2

Payout Ratio

27.9

40.8

29.1

18.7

44.2

133.2

18.7

̶

̶

36.9

20.1

Cash Dividends

36.74

¥

51.60

¥

80.33

¥

67.93

¥

Key Ratios（%）

Notes: 1. In the fiscal year ended March 2017, Iwao & Co., Ltd., was merged with Nisshin Toa Inc., both of which are consolidated subsidiaries. The apparel textile operations of Iwao & Co., Ltd.,
included in the Other Businesses segment were reclassified under the Textiles business segment as a result. Figures from the fiscal year ended March 2013 have been adjusted to reflect thischange.
2. The Group’s elastomer operations were transferred from the Chemicals business to the Textiles business in the fiscal year ended March 2016. Figures from the fiscal year ended March
2015 have been adjusted to reflect this change.
3. The Company changed its fiscal year-end from March 31 to December 31, effective from the fiscal period ended December 31, 2018.
4. The electronics business segment was separated into Wireless and Communications and Micro Devices as part of adjustments to earnings management classifications in the fiscal period
ended December 2019.

66

67

Data Section

Net Income (Loss) Attributable to Owners of theCompany

Overview of Business Segments

Per Share（yen）

How We Achieve Sustainability

Cash Flows (millions of yen)

Financials

HIGHLIGHTS◦ In addition to favorable performance in Wireless and Communications, higher net sales in Micro Devices, Automobile Brakes andPrecision Instruments, all of which continue to recover from the impacts of the pandemic, contributed to Group sales growth.
◦ Net income attributable to owners of the Company expanded on ordinary income growth and lower income taxes.

Operating Results
Precision Instruments, all of which continue to recover from the impacts of the pandemic, resulted in net sales of ¥510,643 million (US$4,440
million), up ¥53,592 million (11.7%) year on year. Higher net sales resulted in operating income of ¥21,789 million (US$189 million), up¥20,541 million year on year. Net income attributable to owners of the Company amounted to ¥24,817 million (US$216 million), an
improvement of ¥11,276 million (83.3%) year on year, as a decline in extraordinary income from gains on sales of investment securities wasoffset by ordinary income growth, lower income taxes and other factors.

(billions of yen)(billions of yen)

600

25

500

20

400

15

300

10

200

5

100

0

0

-5

18.12

(adjusted)

19.12

20.12

21.12

Based on focused capital investment in long-term growth fields, the Nisshinbo

term risks posed by the impact of COVID-19, the Company

Group is committed to cutting-edge manufacturing equipment and environmental

maintained the same amount of commitment line contracts

measures, engaging in capital investments to meet growing demands inwith major banks, renewing them for ¥30,000 million. The

developing markets. In the fiscal year under review, capital expenditures totaled

Company also continues to have access to approved funding¥26,482 million (US$230 million). In the Wireless and Communications business,through overdraft facilities and commercial paper, ensuring¥4,535 million was invested in Japan Radio Group backbone IT systems asnecessary levels of liquidity.

well as solutions and specialized equipment business testing equipment. In theMicro Devices business, ¥2,888 million was invested in New Japan Radio Co.,

Cash Flows
Cash Flows from Operating Activities
Cash provided by operating activities totaled ¥39,828
million (US$346 million). This was mainly due to income
and amortization of ¥23,165 million.
Cash Flows from Investing Activities
Cash used in investing activities totaled ¥16,767 million(US$146 million), mainly reflecting ¥20,112 million used forthe purchase of property, plant and equipment.
Cash Flows from Financing Activities
Cash used in financing activities totaled ¥30,819 million (US$268
million). This was mainly due to a ¥5,280 million increase in shortterm bank loans―net, ¥28,149 million for repayment of long-term

18.3

18.12

18.12

(adjusted)

19.12

20.12

21.12

Note: Operating income for the fiscal year ended December 2018 has beenadjusted to facilitate year-on-year comparison.

debt and ¥4,994 million for cash dividends paid.
As a result of the above, cash and cash equivalents at theend of the fiscal year totaled ¥42,596 million (US$370 million),
period.

Dividends
In principle, there are two distributions per fiscal year: the interim dividend and the year-end dividend. We aim for a consolidated payout
ratio of around 30% as we implement the stable and continuous distribution of dividends. In addition to confirming that internal reserves are

million was invested in Ricoh Electronic Devices Co., Ltd., mainly for electronic
device manufacturing facilities. In the Automobile Brakes business, ¥6,093
million was invested in the TMD Group, mainly for friction material manufacturing
facilities, whereas ¥1,005 million was invested in Nisshinbo Automotive
Manufacturing Inc., mainly for manufacturing facilities for friction materials
complying with copper content regulations. In the Precision Instruments business,¥1,996 million was invested in Nanbu Plastics Co., Ltd., mainly for molding
product manufacturing facilities, and ¥1,472 million was invested in NisshinboContinental Precision Machining (Yangzhou) Co., Ltd., mainly for precision
machined parts manufacturing facilities.

Capital Expenditures(billions of yen)

30
25
20
15
10
5
0

17.3

18.3

18.12

19.12

20.12

21.12

Medium-Term Management Strategy

sufficient for future growth strategies, our policy is to engage in more proactive shareholder returns, including consideration for the purchase

The Nisshinbo Group will strive for unity through diversity in Group and global management and contribute to the realization of a sustainableof our own shares. In principle, we will cancel treasury shares, but in the event an M&A project will contribute substantially to increased

society through the embodiment of our corporate philosophy“Change and Challenge! For the creation of the future of Earth and People.”shareholder value, we will utilize stock swaps or issue new shares. In the fiscal year under review, the full-year dividend amounted to ¥30

Nisshinbo will proactively engage in the provision of products and systems that contribute to global environmental preservation and(US$0.26) per share.

alternative energy as an Environment and Energy Company group, while steadily promoting business portfolio transformation with the

Financial Position

on“experiences”and“services,”backed by its strengths in manufacturing“things,”transforming the company into a business that provides

Total assets as of December 31, 2021, stood at ¥604,799 million (US$5,259 million), an increase of ¥23,595 million from the end of theprevious fiscal period. This was mainly due to increases of ¥6,495 million in inventories, ¥11,251 million in receivables and ¥5,398 million indeferred tax assets.
Total liabilities were ¥332,167 million (US$2,888 million), a decrease of ¥6,969 million from the end of the previous fiscal period. This was
mainly due to increases of ¥5,807 million in short-term bank loans and ¥9,017 million in payables, and a decrease of ¥24,754 million in longterm debt (including the current portion).
Equity totaled ¥272,632 million (US$2,370 million), an increase of ¥30,564 million from the end of the previous fiscal period. This was
mainly due to increases of ¥19,823 million in retained earnings and ¥7,172 million in foreign currency translation adjustments.

(billions of yen)(billions of yen)

700
600
500
400
300
200
100
0

300

68

The Nisshinbo Group currently uses Japanese accounting standards. However, given that the Company’s basic management policy is todevelop its business globally, overseas operations will likely account for a growing share of consolidated earnings. Thus, we are considering

50

20.12

21.12

0

communications, and control systems for aircraft and drones. Nisshinbo provides safe and secure social infrastructure as a solution to climate change. In the

Selection of Accounting Standards

100

19.12

networks linking automobiles with traffic infrastructure and developing radar, sensors and other devices needed for autonomous ship operation, satellite

COVID-19. Through such business activities, the Nisshinbo Group is targeting ROE of 12% in 2025.

150

18.12

vehicle components. Furthermore, we provide devices and develop sensors that are key for autonomous driving technologies, while building communication

as we aim for carbon neutrality, Nisshinbo will launch TCFD initiatives while flexibly and proactively responding to the paradigm shift brought about by

200

18.3

and sales promotion of copper-reduced and copper-free friction materials and will accelerate the commercialization of carbon separators and other fuel cellefforts to create service businesses that utilize data gathered from the systems and platforms Nisshinbo develops. Focused on sustainability and governance

250

17.3

as wireless and communications, electronic devices and chemicals. In automobile-related products, we are leading global markets due to the development

voluntarily adopting International Financial Reporting Standards (IFRS), a common set of global accounting standards. At present, no final

17.3

18.3

18.12

19.12

20.12

21.12

decision has yet been made regarding timing and other factors related to the voluntary adoption of these standards.

69

Data Section

EquityIn addition to expanding the mobility field, which is the Nisshinbo Group’s mainstay business, we concentrate the allocation of management resources on
strategic business areas also including Infrastructure & Safety and Life & Healthcare and expand business across the Group by integrating technologies such

medical field as well, we promote Group-wide efforts focused on wireless, communications and electronic device technologies. Furthermore, we are making

As a result of the above, the consolidated shareholders’equity ratio increased 3.4 percentage points to 42.8%.

Total Assets

solutions for new social issues through DX with the aim of realizing a super-smart society.

Overview of Business Segments

awareness that“the quality of a company is the sum of its people, not the business itself.”Furthermore, Nisshinbo will increase its focus

How We Achieve Sustainability

a decrease of ¥6,103 million from the end of the previous fiscal

Ltd., mainly for electronic device manufacturing and R&D facilities, while ¥1,348

Special Feature

Operating Income/Loss

18.12

In the fiscal year under review, with consideration for the long-

before income taxes of ¥22,896 million and depreciation

Net Sales

18.3

Capital Expenditures

How We Manage Our BusinessIn 2021, in addition to favorable performance in wireless and communications, higher net sales in Micro Devices, Automobile Brakes andFund Procurement

Where We’ve Come From,
Where We’re Going

Management’s Discussion and Analysis

Financials

December 31, 2021 and 2020

Thousands of U.S.
Dollars (Note)

Millions of Yen

ASSETS

2021

2021

2020

Time deposits¥

42,596
2,344¥

48,6991,848$

370,400
20,383

Receivables:
17,55618,133

152,661

Trade accounts

104,277

96,456

906,757

675

807

5,870

Other
Allowance for doubtfulreceivables
Inventories
Other current assets
Total current assets

7,357

3,120

63,974

(720)

(622)

(6,261)

122,841

116,346

1,068,183

7,227

7,472

62,842

304,153292,2592,644,809

Land

34,36434,297

298,817

Buildings and structures

162,797

159,642

1,415,627

359,175

347,962

3,123,261

Construction in progress

6,708

6,803

58,330Other

13,98911,906

121,643

Total

577,033

560,610

5,017,678

Accumulated depreciation(404,284)(391,685)(3,515,513)

Net property, plant, andequipment

172,749

168,925

1,502,165

INVESTMENTS AND OTHERASSETS:
55,612457,661

Investments in and advances
to unconsolidated
subsidiaries and affiliates

31,70931,647

275,730

Deferred tax assets

9,984

4,586

86,817

Goodwill

3,304

4,595

28,730Other30,26923,580263,210

127,897

120,020

1,112,148¥ 604,799¥ 581,204$ 5,259,122

TOTAL¥ 41,054

356,991

30,000260,870

Current portion of long-term
debt

6,356

27,991

55,270

Payables:Trade notes

23,25521,080202,217

Trade accounts

42,631

37,348

370,704

13

79

113

11,926

10,301

103,704

Accrued expenses

17,491

14,773152,096

Accrued income taxes

3,432

6,316

29,843

Other current liabilities

24,233

19,717

210,722200,391

202,852

1,742,530

Unconsolidated subsidiaries
and affiliates
Other

Total current liabilities
LONG-TERM LIABILITIES

53,97257,091

469,322

Liability for retirement benefits

51,98452,804452,035

Deferred tax liabilities

11,001

12,136

95,661Other long-term liabilities

14,81914,253

128,861

Total long-term liabilities

131,776

136,284

1,145,879

Total liabilities

332,167

339,136

2,888,409

EQUITY:
Shareholders’ equity:
Common stock—authorized,
371,755,000 shares; issued,
179,042,894 shares in 2021
and 178,978,479 shares in
2020

27,69927,669240,861

Capital surplus

19,882

20,450172,887

Retained earnings

193,921174,098

1,686,270(15,953)(15,950)(138,722)¥510,643¥457,051$4,440,374

COST OF SALES

395,161

365,434

3,436,183

115,482

91,617

1,004,191

93,69390,369814,721

21,7891,248

189,470

1,649

1,931

14,339(9,948)Gross profit
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES
Operating income
OTHER INCOME (EXPENSES):Interest and dividend income(1,144)(1,138)Gain on sales of property, plant, and equipment

1,105

1,315

9,609

Equity in earnings of an unconsolidated subsidiaries and affiliates

2,674

2,574

23,252(1,619)(3,837)(14,078)

2,418

19,211

21,026(4,617)(909)(40,148)

Interest expense

Loss on impairment of long-lived assets
Gain on sales of securities
Business structure improvement expenses

641

(365)

5,574

1,107

18,782

9,626

22,896

20,030199,096

Current

4,273

7,962

37,157

Deferred(7,565)(593)(65,783)(3,292)

7,369(28,626)

NET INCOME

26,18812,661

227,722NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS

1,371

(880)

11,922¥ 24,817¥ 13,541$ 215,800

Yen

U.S. Dollars¥149.08¥81.38

$1.30

30

30

0.26

Other—net

INCOME BEFORE INCOME TAXESINCOME TAXES:

Total income taxes

Total shareholders’ equity

225,549

206,267

1,961,296

PER SHARE OF COMMON STOCK:Net income
Cash dividends

Accumulated othercomprehensive income:Consolidated Statement of Comprehensive Income (Loss)
Years Ended December 31, 2021 and 2020

Net unrealized gain (loss)
on available-for-salesecurities

25,81325,782

224,461

Deferred gain (loss) on
derivatives under hedge
accounting

5

(2)

44

Millions of Yen
2021

NET INCOME¥26,188

Thousands of U.S. Dollars(Note)

2020
2021
Thousands of U.S. Dollars¥12,661$227,722(Note)
Millionsof YenOTHER COMPREHENSIVE INCOME (LOSS):
31(13,787)

Deferred gain on derivatives under hedge accounting

7

22

61

Foreign currency translation adjustments

6,893(5,004)59,93914,609

Postretirement liability adjustments

3,772

927

32,80022,605

291,408

Equity in earnings of unconsolidated subsidiaries and affiliates

1,224

13

10,643

125

151

1,087

11,927(17,829)

103,713

13,446

13,045

116,922272,632

242,068

2,370,713¥38,115¥(5,168)$331,435

6,014(1,158)52,294

Postretirement liability
adjustments

1,680(2,017)33,512

Stock acquisition rights
Noncontrolling interests

COMPREHENSIVE INCOME (LOSS)TOTAL COMPREHENSIVE INCOME(LOSS) ATTRIBUTABLE TO:¥581,204 $5,259,122

Owners of the Company¥35,723¥(4,296)$310,635

Note: The translations of Japanese yen amounts into U.S. dollar ($) amounts are included solely for the convenience of readers outside Japan and have been made at the rate of ¥115 to $1, theapproximate rate of exchange at December 31, 2021.

Noncontrolling interests

2,392

(872)

20,80070¥604,799

Total other comprehensive income (loss)

270

71

Data Section

Net unrealized gain (loss) on available-for-sale securities

Foreign currency translation
adjustments

TOTAL

NET SALESNET INCOME ATTRIBUTABLE TO OWNERS OF THE COMPANY

Treasury stock—at cost,
12,552,280 shares in 2021
and 12,549,457 shares in2020

Total equity

2021

Other income (expenses)—net

Long-term debt

Total

2020

Overview of Business Segments

52,631¥ 35,247 $

30,000

Short-term bank loans

2021

2021

Commercial paper

Thousands of U.S. Dollars(Note)How We Achieve Sustainability

Machinery, equipment andtools

Total investments andother assets

2020

Millions of Yen

Special Feature

PROPERTY, PLANT AND
EQUIPMENT:

Investment securities

2021

Years Ended December 31, 2021 and 2020

How We Manage Our Business

Trade notes

Unconsolidated subsidiaries
and affiliates

LIABILITIES AND EQUITYCURRENT LIABILITIES:CURRENT ASSETS:
Cash and cash equivalents

Millions of Yen

Thousands of U.S.
Dollars (Note)

Where We’ve Come From,
Where We’re Going

Consolidated Statement of Profit or Loss

Consolidated Balance SheetFinancials

Years Ended December 31, 2021 and 2020

Millions of Yen
2021

2020

Thousands of
U.S. Dollars (Note)
2021

Segment Information

Years Ended December 31, 2021 and 2020

2021

OPERATING ACTIVITIES:¥20,030$199,096(10,998)(4,413)(95,635)

Depreciation and amortization

23,165

22,125

201,435

Amortization of goodwill

1,334

1,832

11,600(2,674)(2,574)(23,252)

178

9

1,548

Segment profit (loss)

Interest and dividends income

3,725

3,692

32,391

Segment assets

Provision for business structure improvement

2,922

446

25,409Provision for contingent loss

―

(331)

―

Provision for product warranties

―

(296)

―

Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Income taxes—paid

Equity in losses (earnings) of unconsolidated subsidiaries and affiliates
Provision for (reversal of) doubtful receivables(6,739)Loss on impairment of long-lived assets

1,619

3,837

14,078Loss (gain) on sale of investment securities and investments in and advances tounconsolidated subsidiaries and affiliates, net(2,418)(19,207)(21,026)

Loss on write-down of investment securities and investments in and advances tounconsolidated subsidiaries and affiliates

36

308

313

Decrease (increase) in receivables(9,536)

14,483(82,923)

Decrease (increase) in inventories(5,432)

5,499(47,235)

Increase (decrease) in payables

7,387(3,114)64,235

9,588

1,267

83,374

Total adjustments

16,932

22,560147,234

Net cash provided by (used in) operating activities

39,82842,590346,330

Proceeds from sale of property, plant, and equipment

1,852

2,265

16,104

Proceeds from sale of investment securities and investments in and advances tounconsolidated subsidiaries and affiliates

5,596

22,304

48,661(20,112)(24,601)(174,887)

Purchase of investment securities and investments in and advances to unconsolidated
subsidiaries and affiliates

(118)

(36)

(1,026)

Decrease (increase) in time deposits—net(284)(1,726)(2,469)―(1,329)―(3,701)(3,198)(32,183)(16,767)(6,321)(145,800)¥23,061¥36,269$200,530

Changes in operating assets and liabilities:

Other—net

INVESTING ACTIVITIES:

Purchase of property, plant, and equipment

Purchase of investments in subsidiaries with changes in consolidation scope
Other—net
Net cash provided by (used in) investing activities
FORWARD

Proceeds from long-term debt

2,698

36,51923,461

Repayment of long-term debt

(28,149)(41,468)(244,774)

5,280(11,210)45,913(4,994)(4,992)(43,426)

Increase (decrease) in short-term bank loans—net
Cash dividends paid

Increase (decrease) in other long-term liabilities
Other—net
Net cash provided by (used in) financing activities
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

(3)

(4)

(26)

(730)

(531)

(6,348)(4,921)(2,544)(42,791)(30,819)(24,230)(267,991)

1,655

(608)

14,391(6,103)

11,431(53,070)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

48,69937,268423,470

CASH AND CASH EQUIVALENTS, END OF YEAR

¥42,596¥48,699$370,400

72¥155,085¥77,374¥138,295¥55,769¥11,083¥ 34,479¥15,584¥22,974

946

1,089

25

565

160

23

1,383

1,867

Consolidated

Sales to externalcustomers
Intersegment sales ortransfers
Total

¥

―

¥510,643(6,058)―¥156,031¥78,463¥138,320¥56,334¥11,243¥ 34,502¥16,967¥24,841¥(6,058)¥510,643¥

7,815¥ 4,292¥¥716¥ 2,054¥ (1,023)¥ 9,389¥

133¥(5,145)¥ 21,789

175,886

75,312

148,70971,824

11,311

38,09937,58232,757

13,319604,799

Depreciation andamortization

3,935

3,966

7,726

4,417

330

1,361

915

226

289

23,165

Increase in property,
plant, and equipment
and intangible assets

4,701

4,236

9,879

4,511

1,378

562

1,783

85

(653)

26,482

Wireless andCommunications

Micro Devices

Automobile
BrakesPrecision
Instruments

Chemicals

TextilesReal Estate

Other
Businesses

Eliminations/
Corporate¥144,312¥61,141¥114,827¥51,419¥ 9,577¥ 33,957¥20,279¥21,539

398

876

20

421

181

17

1,399

2,571

3,558

Other:

2020

Millions of Yen
Consolidated

Sales:
Sales to externalcustomers
Intersegment sales ortransfers
Total

¥

―

¥457,051(5,883)―¥144,710¥62,017¥114,847¥51,840¥ 9,758¥ 33,974¥21,678¥24,110¥(5,883)¥457,051¥

2,575¥(3,895)¥ (2,289)¥ (948)¥ 1,811¥(813)¥11,512¥248¥(6,953)¥

170,435

74,114

131,964

70,057

10,43342,56940,98430,422

10,226581,204

Depreciation andamortization

3,736

4,316

6,744

4,059

214

1,439

914

225

478

22,125

Increase in property,
plant, and equipment
and intangible assets

7,167

4,819

7,684

3,870

108

1,070

398

7

747

25,870

Wireless andCommunications

Micro Devices

Automobile
BrakesPrecision
Instruments

Chemicals

TextilesReal Estate

Other
Businesses

Eliminations/
Corporate

Consolidated$1,348,565$672,817$1,202,566$484,948$96,374$299,817$135,513$199,774$―$4,440,374

8,226

9,470

217

4,913

1,391

200

12,026

16,235(52,678)―

Segment profit (loss)
Segment assets

1,248

Other:

2021

Thousands of U.S. Dollars (Note)

Sales:

Intersegment sales ortransfers
Total$1,356,791$682,287$1,202,783$489,861$97,765$300,017$147,539$216,009$(52,678)$4,440,374

Segment profit (loss)$

67,957$ 37,322

$

$

6,226

$17,861$ (8,896)$ 81,643$

1,157$(44,739)$ 189,470

Segment assets

1,529,443

654,887

1,293,122

624,557

98,357331,296326,800

284,843

115,817

5,259,122

Depreciation andamortization

34,21734,487

67,18338,4092,870

11,835

7,956

1,965

2,513

201,435

Increase in property,
plant, and equipment
and intangible assets

40,87836,83585,904

39,226

11,983

4,887

15,504739(5,678)230,278

30,939Other:

73

Data Section

Purchase of treasury stock

Real Estate

Sales:

Sales to externalcustomers

FINANCING ACTIVITIES:TextilesEliminations/
Corporate

Overview of Business Segments(10,339)(682)

Chemicals

Other
Businesses

How We Achieve Sustainability

(321)

(775)

Precision
Instruments

Special Feature(1,189)Loss (gain) on sale of property, plant, and equipment, net

Increase (decrease) in liabilities for retirement benefits

Micro Devices

Automobile
BrakesHow We Manage Our Business￥22,896

Income before income taxes

Millions of Yen
Wireless andCommunications

Where We’ve Come From,
Where We’re Going

Consolidated Statement of Cash Flows

Key Companies in the Nisshinbo Group

Major External Assessments(As of June 1, 2022)

External Assessments of ESG
Activities

MSCI ESG RATINGS

CDP Water Security 2021 Evaluation
CDP Climate Change 2021 Assessment

FTSE Blossom Japan Sector Relative Index

Company

Main Products and Services

Japan Radio Co., Ltd.

Japan

Disaster prevention systems,
mobile communications equipment

JRC Mobility Inc.

Japan

Automotive radars, ultrasound sensors

Japan

Electronic devices, microwave products

Nisshinbo Brake Inc.

Japan

Automobile brake friction materials

TMD Friction Group S.A.

EuropeAutomobile brake friction materials

Saeron Automotive Corporation

South Korea

Automobile brake friction materials

Nisshinbo Automotive Manufacturing Inc.

USA

Automobile brake friction materials

Nisshinbo Somboon Automotive Co., Ltd.

Thailand

Automobile brake friction materials

Nisshinbo Saeron Changshu Automotive Co., Ltd.

China

Automobile brake friction materials

Nisshinbo Mechatronics Inc.

Japan

Molding products,
automotive precision parts

Nanbu Plastics Co., Ltd.

Japan

Molding products

Nisshinbo Precision Instrument & Machinery Hiroshima Corporation

Japan

Automotive precision parts● Wireless and Communications

Selected as a“Company Taking on the
Zero-Emission Challenge”by the Ministry of
Economy, Trade and Industry (METI)

Special Feature

Location

FTSE Russell (trading name of FTSE International Limited
and Frank Russell Company) certifies that Nisshinbo
Holdings, Inc., has met the requirements for inclusionin the FTSE Blossom Japan Sector Relative Index basedon the results of a third-party survey and has become
a constituent of this index. The FTSE Blossom Japan
Sector Relative Index is widely used to create andevaluate sustainable investment funds and other financial
products.

● Micro Devices
Nisshinbo Micro Devices Inc.
● Automobile Brakes

China

Automotive precision parts

ThailandMolding productsContinental Automotive Corporation

Japan

Automotive precision parts

Japan

Urethane products,
high-performance chemical products

Nisshinbo Textile Inc.

Japan

Shirt fabric, developed materials

NISSHINTOA IWAO INC.

Japan

Textile productsTOKYO SHIRTS CO., LTD.

Japan

ShirtsNisshinbo Do Brasil Industria Textil Ltda.

BrazilTextile spinning

PT. Nikawa Textile Industry

Indonesia

Textile spinning and weaving

PT. Nisshinbo Indonesia

Indonesia

Textile weaving and dyeing

Japan

Real estate operations

Nisshinbo Singapore Pte. Ltd.

Singapore

Group company support

Nisshinbo Business Management (Shanghai) Co., Ltd.

China

Group company support● Chemicals
Nisshinbo Chemical Inc.

Selected as a 2022 Certified Health &Productivity Management Outstanding
Organization

MSCI Japan Empowering Women (WIN) Index
THE INCLUSION OF NISSHINBO HOLDINGS INC.
IN ANY MSCI INDEX, AND THE USE OF MSCILOGOS, TRADEMARKS, SERVICE MARKS OR
INDEX NAMES HEREIN, DO NOT CONSTITUTEA S P O N S O R S H I P, E N D O R S E M E N T O R
PROMOTION OF NISSHINBO HOLDINGS INC.
BY MSCI OR ANY OF ITS AFFILIATES. THE MSCIINDEXES ARE THE EXCLUSIVE PROPERTY OF
MSCI. MSCI AND THE MSCI INDEX NAMESAND LOGOS ARE TRADEMARKS OR SERVICEMARKS OF MSCI OR ITS AFFILIATES.

S&P/JPX Carbon Efficient Index

Overview of Business Segments

Nisshinbo-Continental Precision Machining (Yangzhou) Co., Ltd.
Nisshinbo Mechatronics (Thailand) Ltd.

How We Achieve Sustainability● Precision Instruments

MSCI Japan ESG Select Leaders Index
THE INCLUSION OF NISSHINBO HOLDINGS INC.
IN ANY MSCI INDEX, AND THE USE OF MSCILOGOS, TRADEMARKS, SERVICE MARKS OR
INDEX NAMES HEREIN, DO NOT CONSTITUTEA S P O N S O R S H I P, E N D O R S E M E N T O R
PROMOTION OF NISSHINBO HOLDINGS INC.
BY MSCI OR ANY OF ITS AFFILIATES. THE MSCIINDEXES ARE THE EXCLUSIVE PROPERTY OF
MSCI. MSCI AND THE MSCI INDEX NAMESAND LOGOS ARE TRADEMARKS OR SERVICEMARKS OF MSCI OR ITS AFFILIATES.

Selected as a“Kurumin”Certified ChildRearing Support Company● Textiles

Data Section

SOMPO Sustainability Index● Real Estate
Nisshinbo Urban Development Co., Ltd.
● Other74

How We Manage Our Business

THE USE BY NISSHINBO HOLDINGS INC. OF ANY
MSCI ESG RESEARCH LLC OR ITS AFFILIATES (“MSCI”)
DATA, AND THE USE OF MSCI LOGOS, TRADEMARKS,SERVICE MARKS OR INDEX NAMES HEREIN, DO NOTCONSTITUTE A SPONSORSHIP, ENDORSEMENT,RECOMMENDATION, OR PROMOTION OF NISSHINBOHOLDINGS INC. BY MSCI. MSCI SERVICES AND DATAARE THE PROPERTY OF MSCI OR ITS INFORMATIONPROVIDERS, AND ARE PROVIDED 'AS-IS' AND
WITHOUT WARRANTY. MSCI NAMES AND LOGOS ARE
TRADEMARKS OR SERVICE MARKS OF MSCI.

Headquarters

Where We’ve Come From,
Where We’re Going

ESG Index

75

Corporate Data

Integrated Report 2022 Publication(As of December 31, 2021)

February 5, 1907

Composition of Shareholders

Common Stock

27,698 million (US$240 million)

Treasury stock

Employees

Parent Company

7.0%

219

Subsidiaries

20,893

Total

21,112

Securities firms

23.1%

2.6%

Japanese individuals
and others

Head Officeincluding the potential for market growth in three strategic business areas and value co-creation initiatives.

26.4%

constituting a substantial amount of content in relatively few pages.
How We Manage Our Business

Foreign institutions

17.9%

37,979This Integrated Report explains how the Group will achieve sustainable growth from multiple perspectives,

Micro Devices Inc., our human resource strategy and a report based on TCFD recommendations,

Other Japaneseinstitutions

Tokyo 103-8650, Japan

Thank you for reading the Nisshinbo Group Integrated Report 2022.

Regarding ESG, the report includes a dialogue between an outside director and the president of Nisshinbo

23.0%

2-31-11, Ningyo-cho, Nihonbashi, Chuo-ku,

Shareholders

Japanese financial
institutions

Where We’ve Come From,
Where We’re Going

FoundedIn creating this report, we solicited feedback on Integrated Report 2021 from institutional investors
and incorporated their opinions from the initial planning stages, shared information with departments
responsible for report creation and senior management to ensure the report reflects the voice of the market,

Basic Stock Information
SectorMajor Shareholders

Number of shares per

3105
100 shares

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

18,032

10.83

Fukoku Mutual Life Insurance Company

9,000

5.41

Teijin Limited

7,370

4.43

Custody Bank of Japan, Ltd. (Trust Account)

6,333

3.80

and collaborated with the relevant departments to improve report content as described above. I attest thatthe editing process and published content are appropriate and honest.
My hope is that this report aids in understanding the Nisshinbo Group’s medium- to long-term value
creation capabilities.
Masahiro Murakami
President and Representative Director
Nisshinbo Holdings Inc.

Business year

January 1 to December 31

Shareholder record date

December 31(June 30 for interim dividend)

STATE STREET BANK AND TRUST COMPANY 505001

4,821

2.90

Total shares authorized

371,755,000 shares

CITY INDEX ELEVENTH CO., LTD.

4,249

2.55

179,042,894 shares

Shikoku Chemicals Corporation

2,600

1.56

“International Integrated Reporting Framework,”Value Reporting Foundation (VRF)“Guidance for Integrated Corporate Disclosure and Company-Investor Dialogues
for Collaborative Value Creation,”Ministry of Economy, Trade and Industry (METI)

for dividends

Treasury stock

Transfer agent(As of December 31, 2021)

12,552,280 shares

THE BANK OF NEW YORK MELLON 140044

2,553

1.53

Mitsubishi UFJ Trust and Banking

Japan Wool Textile Co., Ltd.

2,282

1.37

Chiyoda-ku, Tokyo 100-8212, JapanDFA INTL SMALL CAP VALUE PORTFOLIO

2,239

1.34

(As of December 31, 2021)
Corporation: 1-4-5, Marunouchi,

Guidelines Used to Prepare the Report
How We Achieve Sustainability

Total shares issued

Special Feature

trading unit

Number of shares held Shareholding ratio(thousand shares)（％）

Shareholder nameElectrical equipment

Stock code

(As of December 31, 2021)“Sustainability Reporting Standards,”Global Reporting Initiative (GRI)

		

（%）

Nisshinbo Holdings Inc.

180.0

TOPIX

Corporate Website Guidance

Overview of Business Segments

Total Shareholder Return (5-Year Period)

160.0
140.0

Investor Information

120.0

・ Financial results

100.0

・ Securities Report

80.0

・ Presentation materials

Sustainability・ Integrated Report/Annual
Report・ Corporate Governance・ Environment
・ Social
・ Governance

Report, etc.

60.0

Data Section

40.0
20.0
0.0

16.3

17.3

18.3

18.12

19.12

20.12

21.12

（％）

17.3

18.3

18.12

19.12

20.12

21.12

Nisshinbo Holdings Inc.

95.6

124.8

77.1

97.5

75.5

88.3

TOPIX

114.7

132.9

117.1

138.3

148.6

167.5

Note: Share price index trends including dividends (March 31, 2016 = 100)76

77