DENKA GROUPCSR REPORT

2014

References

Pursuing Lasting Trustas an Outstanding ManufacturerReference

The DENKA Group Guidelines
Based on its corporate philosophy, “to become a company that creates new value from resources by fully employing ourtechnological capabilities,” the DENKA Group established CSR action guidelines.

CONTENTS

1. We will promote sustainable social and business development
out of a conviction that corporate social responsibility is theessence of business.
2. While constantly ensuring quality to maintain customer trust,
we will contribute to sound social progress by developing andsupplying products and services that are safe and environment
friendly.

The DENKA Group Guidelines

3

Compliance

4

Information Security and System Management/
Online Information Management5

Responsible Care (RC) Activities

6

ISO 14001 and 9001 Management Systems

7

Environmental Conservation

8

Product Safety Management System

11

Environment- and Energy-Related Subsidies

15

Environmental Accounting

16

The DENKA Group’s Environment-Friendly Products and Technologies

17

Initiatives with Our Stakeholders

21

Corporate Officers

23

Consolidated Financial Statements

24

Global Reporting Initiative (GRI) Content Index

26

3. We will operate fairly.
4. We will maintain a good level of communication with society anddisclose appropriate information.
5. We will comply with laws and regulations and operate fairly
according to social norms.
6. We will maintain safe, clean and comfortable workplaces andrespect all basic human rights.
7. We will use, reuse and recycle resources to help protect theenvironment.
8. We will maintain security and disaster prevention measures,
participate in environmental protection activities and communicate
with society.
9. We will contribute to society as a good corporate citizen.
10. We will contribute to social development as a good member ofthe global community.
Established April 1, 2007

2

DENKA GROUP CSR REPORT 2014

DENKA GROUP CSR REPORT 20143

Reference

Reference

Compliance

Information Security and System Management/Online Information Management

To Maintain the Trust of Society, We Will Develop a Corporate
Structure with Greater Transparency While Ensuring Fair Transactions.

DENKA Will Secure Information Security
through Appropriate Control.

Compliance

Information Security

Our Stance against Corruption and Antisocial Forces
On the back of the recent trend toward the tightening of anticorruption regulations, laws pertaining to the prevention ofbribery of foreign public officials have been enhanced in the
United States and the United Kingdom. As these regulations
are also applicable to Japanese companies, we hold study
sessions and have external specialists give lectures to ensurethat content of these regulations is thoroughly followed byevery employee concerned.
Meanwhile, to prevent antisocial activities, prefectures
throughout Japan have enacted ordinances for eliminatingorganized crime groups. Reflecting this, business transactions
with such forces are now clearly deemed illegal. DENKA is
striving to ensure that the Company and its business partners
have no relationships with antisocial forces. To that end, weare taking such steps as revising business contracts toincorporate rules prohibiting such relationships and asking
business partners to submit written oaths abjuring all such
relationships. We also cooperate with the police, lawyers andother specialized external institutions to gather the latest
information.
Security Trade Control
Current international regulations on trade control aim toprevent the proliferation of weapons for mass destruction byprohibiting exports of products and technologies that could
help the development and manufacture of such weapons. Inline with this, the DENKA Group Ethics Policy requires
adherence to Japan’s Foreign Exchange and Foreign Trade
Act, the Export Trade Control Order and other related
regulations as well as the Company’s in-house rules on security
trade control. Reflecting this, our fiscal 2013 initiatives aimed
at ensuring security trade control included internal audits
undertaken at each sales section and participation in externalseminars in addition to product classification as well as enduse and end-user verification in the course of our daily
operations.
Protection of Intellectual Property Rights
In line with the DENKA100 new growth strategies, we are
stepping up initiatives to accelerate global expansion andfacilitate open innovation. Therefore, the protection of
intellectual property rights is becoming ever more important interms of compliance.
In step with global expansion, appropriate measures
must be taken to protect businesses’ intellectual property
rights against piracy in both consuming and production areas.
In addition to exercising their own intellectual property rights,
businesses must respect other companies’ rights while giving
due consideration to local law systems and cultures.
In order to facilitate open innovation, it is essential tomaintain relationships of mutual respect between research
partners as they often share their intellectual property rights
based on joint research contracts.
DENKA’s business divisions, R&D sections, Legal and IP
Departments are working together to tackle these issues while

4

DENKA GROUP CSR REPORT 2014

formulating educational programs aimed at facilitating a
corporate culture that is conscious of intellectual property
rights.
Prevention of Insider Trading
In recent years, the incidence of insider trading by corporate
officers and employees illegally using or leaking information
has increased. In response, Japan’s Securities and Exchange
Surveillance Commission is stepping up efforts aimed at
cracking down on such trading. In line with its in-house rules
regarding the control of insider information and prevention of
insider trading, DENKA prohibits information leakage as wellas the sale or purchase of stocks without prior notice while
uniformly banning such sale and purchase during the two
weeks before the date of financial results announcement.
These rules are thoroughly disseminated via the Company’s
intranet and other media, thereby helping to ensure theappropriate control of information and the prevention of insider
trading.

Information Security Management
The DENKA Group Ethics Policy established in 2002 includes
a code of specific behavior that encompasses guidelines
under the headings the Safe Management of Personal
Information/Confidential Information Management andRespect for Intellectual Property Rights, both of which arestrictly complied with. As subordinate regulations of theseguidelines, DENKA established and developed the Personal
Privacy Policy and the Regulation for Protecting Information
regarding Corporate Secrets, which are thoroughly
disseminated through lectures and in-house newsletters.
Furthermore, DENKA strictly manages and respectfully
handles confidential information provided by third parties inaccordance with the DENKA Group Ethics Policy.

Information System Management
In recent years, the volume of information digitally processed by
the Group’s information system has been rapidly expanding on
the back of drastic advances in IT technologies. Accordingly, it
is increasingly important to secure our information management
system. DENKA created the Information System Management
Guidelines in 2006 and the Information System Work Manual in2008 based on the Regulation for Protecting Information
regarding Corporate Secrets. In cooperation with managers
and persons in charge at each relevant department, we areappropriately handling digitized information.

Information System Management Structure
President

Chief Control Officer

Structure of Information Management Rules
DENKA Group Ethics Policy
Code of specific behavior

Directors in Charge

Chief control officer at each relevant department

General Managers

General administrator at each relevant department

Managers

Administrator at each section or area in charge

Safe Management of Personal Information/Confidential Information
Management and Respect for Intellectual Property Rights
Subordinate regulations

Personal Privacy Policy and Regulation for Protecting
Information regarding Corporate Secrets
Management of information
related to information system

Information System Management Guidelines(established in 2006)

Lectures on Information Security
To disseminate in-house rules pertaining to information
security, our information technology specialist course, covering
the Information System Management Guidelines and basic
rules, is provided annually at Headquarters as well as eachbranch and plant. With classes of about 10 employees, thecourse aims to ensure the adoption of proper information
management methods through practical training as well asactive discussion.

Younger employees participating in a lecture on information management

Protection of Electronic Data
To secure the reliability and efficiency of information systems,
we are utilizing external specialized data centers to manageand operate our information system equipment. As a part ofemergency preparations, in fiscal 2012 we established an
information system operational structure that links two data
centers (located in the east and west of Japan) capable ofsupplementing each other’s operational capacity at the time ofwide-area disaster, including earthquake and tsunami, thereby
securing the continuity of our business operations.
Online Information Management
DENKA utilizes the Tokyo Stock Exchange’s timely disclosure
network (TDnet) service to disclose corporate information
subject to the timely disclosure rules. Although the Company
presents the same information on its website, DENKA makes
sure that such information is protected from unauthorizedaccess or theft prior to the completion of timely disclosure. For
example, the number of personnel handling the managementof the website is strictly limited and they are appropriately
educated. They initiate procedures for the uploading of said
information only after confirming that the information has beensuccessfully disclosed through the aforementioned service.
Moreover, their workspaces are monitored and equipped withprotection systems. We have also set up a procedure tohandle emergencies, such as unintentional information
disclosure and leakage.

DENKA GROUP CSR REPORT 20145

Reference

Reference

Responsible Care (RC) Activities		

ISO 14001 and 9001 Management Systems		

Fiscal 2013 RC Objectives and Achievements

Assessment code: A = Reached target

Environmental Conservation
Community Relations

Disaster Prevention

Occupational Safety and Health

Product Safety

Reducewaste (zeroemissions)

SOx: 64t
NOx: 4,266t
Soot and dust: 123t
COD (BOD): 1,293t

SOx: 84t
NOx: 4,460t
Soot and dust: 73t
COD (BOD): 860t
• SOx emissions decreased approximately 28% year on year due to theswitchover of fuels at the Omi Plant from heavy oil to natural gas.
• N Ox emissions increased 10% year on year reflecting rising cement production
volume and an increase in the nitrogen content of coal used for cement production.
• Soot and dust emissions fell approximately 21% due to such steps as thereplacement of bag filters of dust collectors at the Omuta Plant’s calcium
carbide production facilities.
• COD (BOD) emissions remained virtually unchanged from the previous
fiscal year despite rising production volume. This was thanks mainly to thereinforcement of wastewater treatment facilities used in the Omi Plant’schloroprene rubber production process.

B

Total waste generated: 140,000t

123,590t• Waste reduction efforts at each plant have made progress.

A

Print
28-29
Web
9-10

139,000t
Analyze the causes of waste generation while reducing
waste sent to landfill

In-house and external landfill:
177t

210t
• F ailed to achieve the target due to the replacement of filters used at the
Omuta Plant’s electric furnaces and the disposal of flexible containers at the
Chiba Plant. However, overall performance encompassing plants throughout
the Group resulted in zero emissions.

B

Print
28-29
Web
9-10

Final landfill waste: 178t
Maintain zero emissions

B

Print
32

Raise the recycled resource usage intensity, thereby
contributing to the development of a recycling-oriented
societyEnhance the reuse of automobile shredder residue (ASR)

A

Web
11-12

Continue to supply SDSs and other product safety
information while remaining compliant with suchoverseas regulations on chemicals as REACH

Continuously provide sufficient
information on product safety,
such as through SDSs,* while
complying with international
regulations on chemical
substances, including REACH**• Revised the SDSs and labeling for products for the EU and China while
posting warning signs on reaction and storage tanks that contain substances
designated as hazardous by the Ministry of Health, Labour and Welfare.
• Made notifications under the Act on the Evaluation of Chemical Substances
and Regulation of Their Manufacture, etc., with regard to chemical substances
subject to monitoring while registering such substances in accordance with
REACH regulations.
• Took necessary measures to comply with the TSCA† regulations of the UnitedStates, K-REACH†† and other regulations worldwide that conform with GHS.***

Chemical
substance
management
and emission
reduction

90tCompanywide emissions of PRTR • Emissions of PRTR substances decreased 13% year on year, reflecting a fall
substances: 95t
in toluene emissions resulting from the use of solvent-free adhesives for the
Chiba Plant’s tape products.

Ensure safe
transportation• Conducted plant inspection tours by the Logistics Safety Working Team andidentified points where ongoing countermeasures are necessary (e.g., work
involving heights, stacking of containers).
• The Logistics Training Working Team hosted educational sessions, inviting external
lecturers (the Omuta Plant) to speak.
• Each business site held Logistics Subcommittee meetings to address issues related
to operating procedures, checklist management, staff education and training, andthe maintenance of safety with the aim of ensuring ongoing improvements.

Maintaincommunity
trust

Web
8-10

SOx: 116t
NOx: 4,250t
Soot and dust: 125t
COD (BOD): 1,150t• Reduce BOD emissions at the Omi Plant through such
steps as the improvement of facility management
methods

A

Compliancewith chemical
substance
management
policies

Eliminate
major
accidents

CO2 emissions intensity (from energy sources): 1.22t/t
Energy consumption intensity (fiscal 1990 base): 91% orlower• Promote total CO2 reduction through such steps as
improving production processes and increasing yield ratios

CO2 emissions intensity (from energy sources): 1.24t/t
Energy consumption intensity (fiscal 1990 base): 90%• Achieved the target for CO2 emissions intensity thanks to the success of
individual energy-saving activities implemented on the back of rebounds inproduction volume.

Raise the amount of waste andbyproducts used in one ton of
Recycled resource usage intensity: 554kg/t
cement (recycled resource usage • Promoted recycling of industrial waste into raw materials and fuels.
intensity) (560kg/t in fiscal 2012)Manageemployeehealth

Print
28-29

CO2 emissions intensity (fromenergy sources): 1.24t/t
Energy consumption intensity(fiscal 1990 base): 93% or lower

Use resources
efficiently

Eliminateoccupational
accidents

Major Initiatives and Goals for Fiscal 2014

Achievements

Evaluation

Prevent air andwater pollution

C = Missed target

Goals

Key Area

Prevent global
warming andsave energy

B = Partially missed target

Relevant
pages

Fiscal 2013 (the first year of the Fifth Medium-Term Environmental Plan)"Fulfill responsibilities as abulk shipper "Achieve zero occupational
accidents, implement safety
activities involving all workers,
create a lively and vibrantworkplace, provide safety
education, raise safety
awareness and carry out safety
activities tailored to local needs

Promoted such safety activities as creating a lively and vibrant workplacesince fiscal 2010 by enhancing communication. However, in addition to theoccurrence of major accidents, including a fatal incident, the Company’s
fiscal 2013 safety record exposed challenges in such as areas as accidents
in which workers at subcontractors suffered and accidents resulting frominsufficient on-site experience.

Launched the Mental Health Promotion Plan to implement comprehensive
countermeasures, including providing training and assisting employees who
suffer mental health problems with their reinstatement

Eliminate major accidents,
especially explosions, fires andlarge-scale leaks of chemical
substances while improving
production control• There were two major accidents (explosion and fire), including a heat blastfrom the Omi Plant’s electric furnace and a fire during the demolition of the
Chiba Plant’s SM distillation tower.
• The number of facility-related incidents totaled six (three explosion and fireincidents, two environmental accidents involving leakage and one facility
failure), decreasing nearly by half from 11 of fiscal 2012.
• Applied a security evaluation system at styrene monomer production
facilities and addressed weakness identified through evaluations performed
with the aim of implementing ongoing improvement measures.

Continue to engage
communities and build trust• Addressed complaints from community residents about noise and odors
through response desks at each business site, deploying countermeasuresand responding in good faith to complaints.
• E ngaged in community dialogue, hosted site tours and held children’s
chemistry classes.
• Included a third-party opinion in the DENKA Group CSR Report.

A

A

C

A

C

A

Print
28-29
Web
9-10

Web 13

Print
26-27
Web 14• Eliminate occupational and facility accidents in thecourse of distribution• Promote safety activities with the Logistics
Subcommittee spearheading• Promote risk assessment, prepare manuals, traintransporters, thoroughly manage compliance checklists
and ensure the safety of loading and unloading work

Achieve zero accident rate for incidents resulting in lostwork time by implementing the following policies:• Facilitate worksite communication to create a lively
and vibrant workplace• Safety activities involving everyone and thoroughimplementation of safety education• Implement safety activities tailored to local needs

Print
36-37

Achieve zero disease attributable to work

Print
6-7,
26-27
Web 14• Eliminate major facility accidents such as explosions
and fires• Ensure the security of each production site, including
overseas plants, by implementing steps tailored to thecharacteristics of individual facilities• Apply a security evaluation system Groupwide andstep up facility improvement based on evaluations
while creating a safety-oriented corporate culture

Print
38-39
Web 22

DENKA GROUP CSR REPORT 2014

ISO 14001 (Environment)

Omi Plant

Omuta Plant

Date Certified

Registration Number

October 16, 1999

2661116-2A(BV)

October 28, 2000

2832519(BV)

ISO 9001 (Quality)
Date Certified

Registration Number

Products Covered

August 19, 1994

2936857(BV)

Chloroprene, acetaldehyde, POVAL, ASR, SAKNOHOL,
special cement additives, cement, alumina fiber,
monochloro acetic acid, sodium monochloroacetate,caustic soda, monosilane, dichlorosilane,hexachlorodisilane

November 7, 1998

3066427(BV)

Fused silica, special cement additives, nitride powder,ceramic substrates, steel additives, acetylene black,calcium aluminate cement, FIRELEN, boron, boron carbide
powder, thermally conductive materials, heat sinks,
phosphor

Chiba Plant

May 31, 1999

2229709(BV)

March 22, 1995

2985010(BV)

Polystyrene, acrylonitrile styrene resins, methyl
methacrylate styrene resins, methacrylatebutadiene-styrene
resins, methacrylate acrylonitrile butadiene styrene resins,
acrylonitrile butadiene styrene resins, styrene-maleimide
copolymers, styrene-butadiene copolymers, ethylene vinyl
acetate copolymers, acrylic rubber, polystyrene sheet,styrene monomer, ethyl benzene, rain gutters, vinyl tape,corrugated pipes, duct hosing, polyvinyl chloride

Shibukawa Plant

May 21, 2001

2944628(BV)

October 23, 1996

3119550(BV)

Metal substrates, adhesives, emitters, thermallyconductive spacers, thermally conductive adhesive sheets,
electromagnetic shields, ELEGRIP tape, electric power

Ofuna Plant

November 9, 2001

JQA-EM1895(JQA)

October 25, 1996

JQA-1429(JQA)

Packaging tape, plastic films, polyvinyl chloride fibers

Isesaki Plant

September 30, 2003

2770789(BV)

February 28, 2008

3038095(BV)

Stretch films, food packaging sheets, electronic packaging
sheets, cover tapes, DX FILMs

Denka Innovation Center

July 5, 2004

2988036
(BV)

–

–

–

DSPL Merbau Plant

June 8, 2001

SNG0190016(Lloyd’s)November 29, 2000

SNG0160194(Lloyd’s)

Acetylene black

DSPL Seraya Plant

May 28, 2003

SNG0190023(Lloyd’s)

September 27, 2001

SNG0160242(Lloyd’s)

Polystyrene, methyl methacrylate styrene resins, styrenebutadiene copolymers, styrene-maleimide copolymers

DAPL Tuas Plant

March 2003

2003-0194(PSB)

April 2000

99-2-0984(PSB)

Fused silica filler

Denka Advanced
Materials (Suzhou)Co., Ltd.

May 20, 2008

310092-UK(BV)

September 19, 2007

271680-1(BV)

Electronic packaging sheets, cover tapes

DENKA Polymer Co., Ltd.

––

June 25, 2014

JUSE-RA1970 (JUSE)

Plastic food packaging and plastic sheets

DENKA SEIKEN Co., Ltd.

June 23, 2000

2737475(BV)

July 13, 2005

12 100 25631
TMS (TÜV SÜD)Clinical chemistry diagnostic reagents, immunologicaldiagnostic reagents, bacteriological and virologicaldiagnostic reagents, sterile cotton swabs––

November 19, 2009

2862476(BV)

Companywide emissions of PRTR substances: 92t
Step up ongoing efforts at the Chiba Plant to reduce theemissions of toluene

Facilitate communication with community residents andlocal societies to maintain their trust* Safety Data Sheet ** Registration, Evaluation, Authorisation and Restriction of Chemical Substances *** Globally Harmonized System of Classification and Labeling of Chemicals† Toxic Substances Control Act †† REACH-related law adopted in the Republic of Korea					

6Status of ISO Certification Acquisition
The status of our ISO certification acquisition as of July 10, 2014 is as follows:

Number of fatal accidents and incidents that required lost work time during
fiscal 2013 (fiscal 2012 for comparisons)
DENKA Group: 1 (5); accident frequency of 0.18 (0.92)
Among subcontractors: 7* (3) accident frequency of 1.25 (0.54)* Including one fatal accident

Maintain and improve employee
healthThe DENKA Group Is Pursuing Ongoing Improvement
Using Quality and Environmental Management Systems.

CRK Corporation

Rubber compounds, rubber tape, rubber molding

DENKA GROUP CSR REPORT 20147

Reference

Environmental Conservation

We Are Striving to Monitor Environmental Data
at Each Business Site and Affiliate.

Fiscal 2013 Environmental Performance by DENKA
Business Sites (Japan)* Figures for fiscal 2013 include the environmental data of affiliates.

SOx

NOx

(Tons)
1,000(Tons)
6,000

DENKA

Affiliates

Soot and Dust
DENKA

Items

(Tons)
150

Affiliates

DENKA

Affiliates

800

870

730

4,000 4,470
600

4,330 4,240

4,040

128

730
100

4,460 4,250

125

111

3,000
400
2,000

217

124
116

0

09

10

11

84

12

13

79

14 (FY)
Target

0

09

10

11

12

13

0

14 (FY)
Target09

10

11

COD (BOD)

Fiscal 2013 PRTR Substances Emissions and Transfers
Affiliates

1,600

1,500

1,000

1,150

860

12

13

14 (FY)
TargetSoot and dust emissions decreased byapproximately 21% year on year due
mainly to repairs made to the Omi Plant’s
cement kiln and the replacement of filtersat the plant’s calcium carbide production
facilities. For fiscal 2014, we expect sootemissions to increase as cement production volume increases. We will strive foremissions reduction through such means
as facility improvement.

11

12

DENKA GROUP CSR REPORT 2014

Emissions
Air

Water

Soil

Landfill

Total

AmountTransferred

0

0

0

0

2
12

n-Butyl acrylate
Acrylonitrile

2

0

0

0

2

860

Acetaldehyde

0

6

0

0

6

0

Aniline

0

0

0

0

0

17

Ethyl benzene

3

0

0

0

3

43

Ferric chloride

0

0

0

0

0

27

Calcium cyanamide

0

0

0

0

0

1

Vinyl acetate

16

0

0

0

16

0

Cyanamide

0

0

0

0

0

1

N,N-Dimethylformamide

0

0

0

0

0

18

Styrene

17

0

0

0

17

120

Water soluble copper salt

0

5

0

0

5

0

Toluene

20

1

0

0

21

32

Carbon disulfide

2

0

0

0

2

0

Fluorine compounds

1

0

0

0

1

21

n-Hexane

0

0

0

0

0

4

Boron and boron compounds

1

10

0

0

11

17

2-Ethylhexyl methacrylate

0

0

0

0

0

1

Methyl methacrylate

2

0

0

0

2

12

Total (tons)

64

22

0

0

86

328

Dioxin (mg-TEQ)

25

63

0

0

88

1

13

14 (FY)
TargetDespite rising production volume, COD(BOD) emissions in fiscal 2013 remained
virtually unchanged from the previous fiscal year, thanks to efforts to reinforce thecapacity of the Omi Plant’s treatment facilities for wastewater from the POVAL andchloroprene rubber production process.
We will strive to maintain efficient facility
operations in fiscal 2014, thereby reducing
emissions systematically.

8

PRTR Substances

10

0
10

1

1

2

0

66

3

0

0

0

NOx emissions

t

3,390

790

263

11

2

0

0

SOx emissions

t

61

1

20

2

0

0

0

0.83

0.78

1.02

–

67

5

1

0

0

0

0

1,000m3

63,000

1,190

9,600

2,400

46

427

8

COD (BOD) discharges

t

850

1

10

4

0

0

0

Waste

t

101,260

8,680

12,860

382

167

145

100

Final landfill waste

t

69

72

52

1

16

0

0

t

CO2 emissions (from energy sources)

PRTR substance emissions

Soot and dust emissions
Omuta

7%

Omi

16%
Chiba

25%

1.33

million tons

Omuta

8%

90

Omi

64%

tons

73

tons

Omi

76,671,000
m3

Omi

Chiba

Omuta

92%

73%

9

%

SOx emissions

NOx emissions

0

500

09

33

7

Water used

Chiba

The following table shows PRTR registered substances emitted and transferred in amounts exceeding one ton.

10

1,120

12

14

73

Unit: tons (excluding dioxin)

1,300

84

0.91

1,000

NOx emissions increased by approximately
10% year on year (non-consolidated basis)due to a rise in the volume of the Omi Plant’s
cement production and an increase in thenitrogen content of coal used for cement
production. Emissions at affiliates included
approximately 500 tons from the Tuas Plant
and approximately 190 tons from Hinode
Kagaku Kogyo. Although production volume
is expected to rise in fiscal 2014, we will stepup efforts to reduce NOx emissions.

DENKA

Innovation
CenterIsesaki116

SOx emissions decreased by approximately
28% year on year thanks mainly to the ongoing utilization of low-sulfur byproduct gas
that the Chiba Plant recovered from anearby factory complex for use as a boiler
fuel as well as a switchover of fuels used in
the Omi Plant’s production process to natural gas. Emissions at affiliates included approximately 120 tons from Hinode Kagaku
Kogyo. We will continue to systematicallyreduce SOx emissions in fiscal 2014.

(Tons)

Ofunat

Water used

260

200

Shibukawa

10,000t

10

50

Chiba

0.94

Soot and dust emissions

93

Omuta

0.90

CO2 emissions (from energy sources)
PRTR substance emissions

10

5,000

Omi

Compared with
FY1990

Unit energy consumption

149

Units

6%

Chiba

12%

Omuta

18%

Chiba

4,450
tons

24%

84

Omi

76%

COD (BOD) discharges

Omi

73%

tons

Final landfill waste
Ofuna

7%

Omi

Chiba

860

tons

Omi

98%

25%

33%

210

82%

Omi Plant
Omuta Plant
Chiba Plant
Shibukawa Plant
Ofuna Plant
Isesaki Plant
Denka Innovation Center

tons

Omuta

34%

DENKA GROUP CSR REPORT 20149

Reference

Product Safety Management System

Fiscal 2013 Environmental Performance by DENKA Business Sites, Overseas
Subsidiaries and Affiliates
Items

CO2 emissions (fromenergy sources)
PRTR substanceemissions

Units

Omi

Omuta

Chiba

Shibukawa

Ofuna

Seraya

Tuas

South

DAS

DCD

DPK

Seiken

CRK

HinodeAzumin10,000t

84

12

33

1

1

Isesaki Innovation Center Merbau

2

0

0.4

3.0

2.5

0.2

0.0

–

1.2

1.5

0.1

2.4

0.5

Tons

14

7

66

3

0

0

0

–

–

–

–

1

–

0

0

0.1

5

0

NOx emissions

Tons

3,390

790

263

11

2

0

0

1

5

501

1

0

0

0

3

0

190

29

SOx emissions

Tons

61

1

20

2

0

0

0

–

1

0

0

0

0

0

3

0

118

2

Soot and dust emissions

Tons

67

5

1

0

0

0

0

0

–

–

0

0

0

0

0

0

10

–

Wastewater

1,000m3

63,000

1,190

9,600

2,400

46

427

8

44

98

97

3

2

1

0

440

75

1,880

596

COD (BOD) discharges

Tons

850

1

10

4

0

0

0

0

3

0

–

0

0

0

0

0

2

4

Waste

Tons

101,260

8,680

12,860

382

167

145

100

254

785

411

140

112

19

113

275

84

244

78

Final landfill waste

Tons

69

72

52

1

16

0

0

–

–

381

0

112

18

0

42

37

184

63

We Consider Safety, Environmental Protection and Quality in All Our Processes, from Raw
Materials Procurement to Research, Production, Logistics, Consumption and Disposal.
Product Safety Management
Flowchart

We ensure product safety at each phase—from development andproduction to use by customers—while focusing on maintaining
and improving quality.

1. Development
Verify raw material safety
and required quality level
Production process design

2. Raw Materials
Green procurement
Purchasing
specifications

PRTR substance emissions

NOx emissions

10%

15%
Omuta

7%

96

68%

3. Outsourced Raw
Material Production

Tuas

Omi

Chiba

SOx emissions

tons

Vendor audits

5%

5,185
tons

Omuta

15%

208

Omi

29%

tons

65%
HinodeChiba

57%

We select and use raw materials for which safety can be verified while developing
products that conform with customer and legal demands. We establish production
processes that ensure consistent quality and thus trust in the products we develop.
2. Green Procurement and Purchasing Specifications
We purchase and use raw materials based on the Negative List, which takes into
consideration Japanese and international environmental management regulations, aswell as purchasing specifications that outline the required characteristics of purchased
raw materials. Consequently, we are striving to manufacture superior products from
quality raw materials and production processes.
3 & 5. Manufacturing Vendor Audits
We outsource some raw material production processes and the manufacture of semiprocessed goods. We regularly audit manufacturing vendors based on our in-housestandards for quality, logistics, environmental management and product safety.

Omi

Chiba

1. Verify the Safety of Raw Materials and Required Quality Level and Engage in
Production Process Design

4. Production
ISO 14001, ISO 9001 andGood Manufacturing Practices(GMP 1 )

10%

①原材料

4. Maintain/Improve Environmental Protection and Quality
We are undertaking environmental and quality management operations; gradually
expanding the scope of our efforts to include new products; and working to maintain andimprove quality, environmental protection and safety.
6. Waste Contractor Audits

Wastewater

Soot and dust emissions

5. Outsourced
Processing
and Production

COD (BOD) discharges

Hinode

6. Disposal

Vendor audits

12%

Waste contractor
audits

Chiba

Omuta

7. Management of Environmentally Hazardous Substances in Products

12%

6%

83

Omi

tons

80%

79,907,000
m3

Omi

79%

874
tons

Omi

97%

7. ProductsManagement of environmentallyhazardous substances (Negative List)

8. Logistics

Final landﬁll waste
Omi

Azumin

7%

6%

Omuta

7%

Hinode

18%

1,048
tons

Tuas

36%

10

DENKA GROUP CSR REPORT 2014

We commission waste contractors in line with the Waste Management and Public
Cleansing Law, requiring them to issue manifests and confirm collection. We regularly
evaluate the operations and financial positions of these vendors and visit their waste
processing sites.

Omi Plant
Omuta Plant
Chiba Plant
Shibukawa Plant
Ofuna Plant
Isesaki Plant
Denka Innovation Center
Denka Singapore Pte., Ltd. Merbau Plant
Denka Singapore Pte., Ltd. Seraya Plant
Denka Advantech Pte., Ltd. Tuas Plant
Denka Advantech Pte., Ltd. Tuas South Plant

Denka Advanced Materials (Suzhou) Co., Ltd. (DAS) [China]
Denka Chemicals Development Suzhou Co., Ltd. (DCD) [China]
DENKA Polymer Co., Ltd. (DPK)
DENKA SEIKEN Co., Ltd. (Seiken)
CRK Corporation (CRK)
Hinode Kagaku Kogyo Kaisha Ltd. (Hinode)
DENKA Azumin Co., Ltd. (Azumin)

Yellow cards
Container labels 2

9. Customers
Safety data sheets (SDS)
MSDSplus 3
AIS 3

We established the Negative List, which lists substances that are considered to beharmful to people and the environment. We are taking steps to ensure product quality
and safety while reducing environmental load by placing restrictions on usage during the
raw material phase and by decreasing the residual volume of harmful substances in our
products. The Advanced Technologies Research Institute analyzes the amount ofresidual substances harmful to the environment contained within raw materials andproducts. Analytical data verifying that the amount of such substances is below regulatory
limits is shared with the production, sales, and analysis and product management
departments.
8. Displaying Yellow Cards and Yellow Card Container Labels
We require drivers to carry yellow cards that explain post-accident procedures. We alsolabel containers to ensure swift and proper remediation. We regularly inform drivers of
our requirements and conduct emergency drills.
9. Safety Data Sheets (SDS)
We produce these sheets for all products to ensure proper handling according tophysical and chemical hazards and health and environmental risks. The sheets informcustomers and help educate employees. We have begun disseminating information on
environmentally hazardous substances contained in our products to customers throughthe Material Safety Data Sheet plus (MSDSplus)—which supplements information
conveyed on SDS sheets—and Article Information Sheet (AIS) systems.

DENKA GROUP CSR REPORT 201411

Quality Symposia, SQC and Quality Engineering Education
The DENKA Group holds periodic quality symposia aimed atenhancing quality management techniques while implementing education programs on the statistical quality control (SQC)
method and quality engineering across the board.
On February 21, 2014, the fourth quality symposium
was held and attended by representatives of the Company’splants, research laboratories and affiliates. During the twosessions, “Applying the SQC Method: Case Studies” and“Resolving Quality-Related Problems: Case Studies,” sevenpresentations were given that shared best practices in thearea of quality improvement.
SQC and Quality Engineering Education
DENKA has been implementing employee education programs centered on SQC to enhance quality control techniques on a Companywide basis. We are continuously striving
to improve such programs in line with the following policies.
• Tailor these programs to best serve diverse levels of expertise, offering introductory to advanced levels with particularemphasis on ensuring that the basics of the SQC method
are firmly adopted• Appoint persons to take charge of SQC promotion at eachproduction site and nurture them as SQC trainers• Establish Companywide education policies and determine
the required level of comprehension by job rank and category• Enrich the software used for statistical analysis
In addition, in fiscal 2013 we began to introduce quality
engineering (Taguchi methods) to advance our quality management techniques. The aim of quality engineering is to effectively ensure high product performance regardless of variability in production and end-use conditions.
After holding a study session themed on this engineering approach in fiscal 2012, we went on to implement a pilot
project during fiscal 2013 under selected R&D themes, withexternal specialists serving as advisors. Although some research has yet to yield results, we will continuously practicethis approach to enhance the quality of our products.

Collaborating in Chemical Industry Initiatives
HPV (High Production Volume) Program
DENKA has been participating in the HPV program, in which
chemical companies collaboratively evaluate the safety ofaround 1,000 substances that are used heavily worldwide
and are designated as priority substances by the Organisation for Economic Co-operation and Development (OECD).
The Company also takes part in the Japan Challenge Program, a similar initiative undertaken by the domestic chemicalindustry. Since fiscal 2011, DENKA has participated in JIPS,4
an initiative sponsored by the Japan Chemical Industry Association (JCIA) in support of GPS.5 Under JIPS, we collect anddisclose information on hazardous substances while carryingout risk assessments. This initiative also resulted in preparing
and posting GPS/JIPS Safety Summaries for three substances on the GPS portal site run by JCIA.

LRI (Long-range Research Initiative)
The Japan Chemical Industry Association, the American
Chemistry Council and the European Chemical Industry
Council oversee this program. The program entails conducting long-term basic research to correctly determine if and/or
in what manner chemical substances affect human health andthe environment. Currently, these bodies are engaged in longterm basic studies of such issues as ecological (environmental) toxicity due to exposure to chemical substances, neural
toxicity and cancer caused by exposure to toxic chemicals,and endocrine hypersensitivity due to exposure to chemical
substances.

1. Good Manufacturing Practices (GMP) refers to standards that Japan’s Ministry of Health, Labour and Welfare established in its Ministerial
Ordinance on Standards for Manufacturing Control and Quality Control for Drugs and Quasi-drugs.
2. The Japan Chemical Industry Association created a labeling format to augment the Yellow Card system. The labels present emergency guideline
numbers and United Nations identification numbers for different chemicals transported simultaneously in relatively small amounts on the samevehicle. The labels aid in the proper handling of these chemicals in emergencies.
3. The Joint Article Management Promotion-consortium (JAMP*)’s Material Safety Data Sheet plus (MSDSplus) and Article Information Sheet systems
provide standardized formats for presenting information on substances subject to management. MSDSplus is mainly for substances and agentsthat are upstream in the supply chain. Article manufacturers produce Article Information Sheets based on that information. JAMP aims to spread
its systems throughout Japan and Southeast Asia.
* JAMP is a cross-industry association established in Japan in 2006 to encourage companies to properly manage information on substances andcompounds as well as on chemical substances in parts, plastics and other articles. JAMP also establishes mechanisms to disclose and present
information on supply-chain products.
4. Japan Initiative of Product Stewardship (JIPS): Domestic chemical manufacturers’ voluntary initiative to control the risk of chemical substances
encompassing their supply chains.
5. Global Product Strategy (GPS): A voluntary initiative promoted by the International Council of Chemical Associations (ICCA) to control the risk ofchemical substances.

12

DENKA GROUP CSR REPORT 2014

Streamlining Logistics for Further Energy Savings
Response to the Revised Law Concerning the Rational
Use of Energy
As a designated shipper,* we are dedicated to enhancing theefficiency and environment friendliness of our logistics operations, namely the transportation and storage of products, withthe aim of improving customer satisfaction.
In recent years, an upturn in the domestic economy hascaused cargo transportation volumes to grow and the supplyof trucks and cargo vessels to tighten. Securing a stablemeans of product distribution has therefore become crucial tocustomer service. Under the banner of “scrutinize every costelement” set forth in the DENKA100 new growth strategies,
we are striving to overhaul our distribution structure with theaim of optimizing logistics. Accordingly, we are promoting
modal shifts while consolidating storage facilities, including
those located overseas. In these ways, we will develop a morerobust logistics platform.
In fiscal 2013, although the Company’s total transportation volume was 567 million t-km, up 6.5% compared withfiscal 2012, we were able to cut energy consumption intensity
0.9% year on year. This almost matched our year-on-year reduction target of 1% and was attributable to the success ofefforts to enhance transportation efficiency. The CO2 emission
volume increased 5.5% year on year in step with rising transportation volume. Looking ahead, we will further pursue optimal logistics operations in line with ongoing efforts to promoteenergy savings and reduce energy consumption intensity.
* Designated under the Revised Law Concerning the Rational Use of Energy: Business operators whose annual transportation volume exceeds 30
million t-km are obligated to fulfill specific requirements under said law, including submitting reports on their energy-saving targets and achievements.

Energy Saving Status
(FY)

2009

2010

2011

2012

2013

Transportation volume (1,000t-km)

618,865

605,609521,1310.95

567,484

Energy consumption intensity*

0.02400.02390.02500.02460.024499.6%

104.8%

98.3%

99.1%

38,50034,70034,80036,707

Change from fiscal 2012
CO2 emissions (t-CO2)

39,500

Safety inspection undertaken
at the Isesaki Plant

Hands-on training on storage management
implemented at the Omuta Plant

Initiatives Aimed at Streamlining Exports of Special Cement
Additives
The Special Cement Additives Dept., which markets a number of concrete improvers and other related products todomestic and overseas customers, has taken on the challenges of improving the efficiency and energy use of its export
operations. Previously, the department had been transporting
most of its output from the Omi Plant (Itoigawa, Niigata Prefecture) to the Tokyo metropolitan area, where it was reloadedon cargo vessels heading overseas. Revising this distribution
structure, the department began exporting through Naoetsu
and other ports nearer the plant using containers pre-loadedon plant premises.
This initiative was initiated in fiscal 2013 on a trial basis,and the volume of products exported through the new transportation route totaled approximately 700 tons. We will further
promote this shift to reduce CO2 emissions and transportation costs.

* Crude oil equivalent divided by cargo volume

Initiatives Undertaken by the Logistics Subcommittee
In addition to reviewing our distribution structure, we are striving to reinforce our logistics platform.
1.Logistics Safety Working Team
From fiscal 2013 onward, each plant is undertaking periodic
worksite patrols to raise safety awareness, with selected staff
inspecting logistics-related facilities.
2.Logistics Training Working TeamThe Omuta Plant hosted hands-on training for efficient warehousing within the factory premises, with external consultants
giving lectures.

Loading yard of the Omi Plant

Loading products for export into
shipping containers

DENKA GROUP CSR REPORT 201413

Reference

Environment- and Energy-Related Subsidies

We Proactively Utilize Subsidy Programs to Develop Technologies
That Reduce the Environmental Burden and Energy Consumption.
Occupational Safety and Health Management System
DENKA conducts risk assessments to monitor the degree ofrisk at each plant. Based on assessment results, we comprehensively manage risks and implement improvements. The
status of certification acquisition from external institutions is
as in the following table.
Although the Shibukawa Plant has yet to acquire certification for its occupational safety and health management
system, the plant is implementing safety management andInitiatives under the Government Subsidy Programs

promotion activities equivalent to those prescribed by a certified system.
Certification System Certification Number

Acquisition Date

Chiba Plant

Plant NameOHSAS 18001

279788February 6, 2007

Omi Plant

OSHMS

10-15-6

March 8, 2010

DSPL Seraya Plant

OHSAS 18001

SNG6011133

January 23, 2011

Change Management

Commercial operation

Test operation

Additional precautionary work

Confirmation upon completion

Construction and equipment production

Assess process suitability
at planning stage

Detailed designs and orders

Preliminary safety assessment

Approval

Deliberation

Decision on facilities outline and budget* 4Ms: Man, Machines (facilities, equipment, tools), Materials (raw materials
and components) and Methods (including work methods/operations, processing conditions and formulas)

Consider ways to reduce safety and security risks
and incorporate them in detailed designs
and equipment production specifications

Process review

This encompasses establishing rules to assess risks andimplement measures where needed for changes in the 4Ms*
during production. Preliminary safety assessments are important when building plants that use new processes. Change
management comes into play when we upgrade or modify
facilities. Facilities and operations departments conduct preliminary safety assessments and gather with in-house third
parties to discuss risks relating to fires, explosions and worker
safety. In particular, we emphasize preventing key lapses inareas concerning disaster prevention and occupational health.

Confirm that instructions havebeen implemented and order
additional precautionary work

Category

Project

DENKA GROUP CSR REPORT 2014

Business site

Subsidy title, Relevant authority

Fiscal year

1

Energy saving

Introduction of energy-saving burners for cement calcining, etc. Omi Plant

Subsidy program for the rationalization of business operators’
FY2011energy use (METI)

2

Energy saving

Introduction of the latest technologies at petrochemical plants
Chiba Plant(styrene monomer-related facilities)

Subsidy program for the rationalization of business operators’
FY2011 and 2012energy use (METI)

3

Energy saving

The improvement of heat recovery at the Omi Plant’s POVAL
production facilities

Omi Plant

Subsidy program for the rationalization of business operators’
FY2012 and 2013energy use (METI)

4

Energy saving

The introduction of high-performance burners for cement
production

Omi Plant

Subsidy program for the rationalization of business operators’
FY2013energy use (METI)5

The environment

CO2 emissions reduction initiative through a fuel changeoverfrom A-class heavy oil to town gas and LPG

Shibukawa Plant

Voluntary Emissions Trading Scheme (MOE)

FY20106

The environment

Development of a method to recycle slaked lime generated
from acetylene manufacture into cement products

Omuta Plant

Environment Research and Technology Development Fund
(MOE)

FY2011 and 20127

Advanced technology

Demonstration of a high-frequency induction furnace forsilicon nitride

Omuta Plant

Innovation Center Establishment Assistance Program (METI)FY2012 and 20138

Advanced technology

Demonstration of a boron nitride production facility (for use innext-generation high-heat conductive fillers)

Omuta Plant

Innovation Center Establishment Assistance Program (METI)FY2013 and 2014

9

Domestic businesslocation

Establishment of a production facility for a high-performance
conducting agent (acetylene black) for LiBs

Omuta Plant

Domestic Business Location Promotion Project Subsidy(METI)FY2013 and 201410

Advanced technology

Establishment of an R&D facility for next-generation LiBs

Advanced Technologies Program for Accelerating Breakthrough Innovation for
Research Institute
Practical Applications

The Omi Plant’s cement production facility

14

its target for CO2 emissions reduction, entitling it to CO2emission credits. The Omuta Plant succeeded in developinga method to recycle slaked lime, a byproduct of acetylene
manufacture, into cement products.
• The Omuta Plant won two governmental pilot projects fortesting advanced silicon nitride and boron nitride production
facilities under the Innovation Center Establishment
Assistance Program. Construction is now under way at
the Chiba Plant to establish an ultra-pure acetylene black
production facility that utilizes the Domestic Business
Location Promotion Project Subsidy. In addition, thedevelopment of a breakthrough technology for nextgeneration LiBs that is under way at the DENKA Innovation
Center’s Advanced Technologies Research Institute wasselected as a project under the support of METI’s Programfor Accelerating Breakthrough Innovation for Practical
Applications.

As part of its activities to reduce the environmental burden as
well as energy consumption, DENKA actively utilizes subsidy
programs provided by the Japanese Ministry of the Environment (MOE) and the Ministry of Economy, Trade and Industry(METI). It also utilizes subsidies aimed at facilitating publicprivate cooperation in advanced technology pilot projects aswell as at encouraging Japan-based production and R&D
facility construction.
During the fiscal 2010 to 2013 period, DENKA received
subsidies and approvals for subsidies for ten projects.
• As for energy-saving initiatives, the Omi Plant’s cement and
POVAL sections and the Chiba Plant’s styrene monomer
section, etc., have succeeded in reducing annual energy
consumption well in excess of their targets. Both plants areapplying for continued energy-saving-related subsidies infiscal 2014.
• Among initiatives aimed at reducing environmental burden,
the Shibukawa Plant was able to considerably surpass

The Chiba Plant’s styrene monomer production
facility

FY2014The Omi Plant’s POVAL production facility

DENKA GROUP CSR REPORT 201415

Reference

Reference

Environmental Accounting

The DENKA Group’s Environment-Friendly Products and Technologies

We Apply Environmental Accounting Covering Investments andSpending and Their Environmental and Economic Effects.

Employing Proprietary Technologies, We Offer Products and Solutions That
Contribute to Environmental Protection and Social Development.
Category:

Conservation Costs

Protect the environment

Improve the operational environment

Reduce weight of finished goods

Save resources and energy

Contribute to society

Electronics & Innovative Products Division

The Company’s environmental investments in fiscal 2013 were mainly accounted for by the following items: environmental conservation
costs associated with the introduction of energy-saving facilities (41%); implementation of environmental burden reduction measures (31%);
investments for the effective utilization of resources (15%); and R&D spending focused on developing energy-saving products (14%).

Category

Department

Product Name

Application

Benefits

Electronic Products
Dept.

DENKA AN PLATE, DENKA SN
PLATE and ALSINK

Rolling stock, industrial
instruments, electric and hybrid
vehiclesCeramic-based electronic circuit substrates with superior heat dispersion
capabilities that, when used in such components as inverters and drive
transistors, facilitate the downsizing and secure the greater reliability of units

Advanced Specialty
Materials Dept.

ALONBRIGHT

Phosphor for LEDs

A phosphor for white LEDs used in backlights for LCD TVs and various types of
LED lights that helps to significantly reduce energy consumption

Air conditioners, electronic
circuit substrates for automotiveparts

An electronic circuit substrate used in invertors that effectively disperses theheat emitted by drive transistors to protect electronic circuits and to facilitate
the downsizing of such components

Electronic circuit substrates for
LEDs

Electronic circuit substrates that help improve LED luminous efficiency byeffectively dissipating the heat generated by LEDs

Conservation Costs (millions of yen)
Conservation Cost Category

Details
Investments

Expenses(Subtotal)

1,153

2,302

a) Pollution prevention

Environmental burden reduction measures

416

1,795

b) Conservation

Energy saving

541

112

c) Recycling resources

Using resources effectively

197

395

2) Upstream and downstream costs

Changing raw materials, etc.

003) Administrative costs

Educational activities

4) R&D costs

Development of energy saving products, etc.

1) Business site costs

0

24

181

870

5) Social activity costs

Educational activities

0116) Environmental damage costs

Community relations

0

99

0

0

1,334

3,306

7) Others
Total

Electronic Products
Dept.
HITTPLATEElectronic Products
Dept.

Conservation Effects
We calculated the environmental load data. For more details, please also refer to the CSR Report 2014 (print or online version) and site reports.
Environmental Load

Units

FY2012 Results

FY2013 Results

Effects

10,000t

228

234

-6

SOx emissions

t

116

124

-8

NOx emissions

t

4,044

4,460

-416

Soot and dust emissions

t

93

73

20

CO2 emissions (from energy and non-energy sources)

COD (BOD) discharges
Water used
PRTR substance emissions
Waste
Final landfill waste
CO2 emissions from transportation

t

864

860

4

1,000m3

77,86076,750

1,110

t

103

90

13

1,000t

132

123

8

t

180

210

-30

1,000t35

37-2

Economic Effects

Electronic Products
Dept.

Thermally Conductive Sheets

Automotive parts, smartphones
and tablets

Silicon insulating materials packed with ceramic filler that boast high thermal
conductivity for use in hybrid and electric vehicles as heat dissipaters for power
semiconductors, facilitating the downsizing of automotive parts

Advanced Specialty
Materials Dept.

Silicon nitride

Bearings for wind power
turbines, mold-release agentsfor manufacturing silicon ingots
for solar cells

High-strength ceramic material used in the bearings of wind power turbines toenhance durability while significantly reducing facility maintenance workload.
It is also used as a mold-release agent for manufacturing silicon ingots being
processed into solar cells.

Advanced Specialty
Materials Dept.

BN powderLEDs

A highly heat-conducting material used as a filler for LED chips’ encapsulant todisperse heat and thereby enhance LED's luminous efficiency

Advanced Specialty
Materials Dept.

Molded BN products

LED manufacturing equipment

Used in LED chip manufacturing equipment as an excellent, easy to castinsulation material

Advanced Specialty
Materials Dept.

Spherical fused silica filler

Semiconductor encapsulant
fillers

An incombustible filler with a modified particle form and size mixed in theencapsulant used for semiconductors. Capable of protecting circuits fromtemperature fluctuations, it can be used to reduce the need for hazardous
flame retardants.

Advanced Specialty
Materials Dept.

Spherical alumina

LEDsInserted into a resin matrix as a heat-conducting filler for the purpose ofdissipating the heat generated by LED chips and thereby enhancing LED’s
luminous efficiency

Adhesives &Solutions Dept.

HARDLOC (SGA)

Metal adhesion (substitute forwelding)

An adhesive that hardens at room temperature and can be substituted for
welding metal, reducing energy consumption significantly while eliminating theneed to fix the deformation of metal materials

Adhesives &Solutions Dept.

TEMPLOC

Temporary adhesives forthe processing of glass insmartphones

A temporary UV-curing fixing adhesive that can be removed with hot water
rather than solvents, thereby reducing environmental burdens attributable towastewater treatment and heat processing while facilitating cost reduction byenabling “laminated-glass cutting”

Adhesives &Solutions Dept.

SOLARLOC

Temporary adhesives used
for slicing silicon ingots being
processed into solar cells

A 2-component type adhesive removable with hot water rather than organic
solvents, thereby reducing environmental burdens attributable to wastewater
treatment and heat processing

To present the actual economic effects of our environmental conservation measures, we calculated proceeds from selling and recycling
waste as well as cost reductions in the form of energy savings and reductions in waste treatment costs.
Item

Details

Effects (millions of yen)

Proceeds from selling waste from core operations and income from recycling
waste

Sales profits

393

Conserving energy

350

Using resources effectively

10

Category
Profits

Cost
reductions

Lowering energy costs by conserving energy
Reducing waste treatment costs by conserving or recycling resources
Total

16

DENKA GROUP CSR REPORT 2014

753

DENKA GROUP CSR REPORT 201417

Reference

The DENKA Group’s Environment-Friendly Products and Technologies

Category:

Protect the environment

Improve the operational environment

Reduce weight of finished goods

Save resource and energy

Contribute to society

Infrastructure & Inorganic Materials Division
Category

Department

Special Cement
Additives Dept.

Category:

Protect the environment

Improve the operational environment

Reduce weight of finished goods

Contribute to society

Infrastructure & Inorganic Materials Division
Product Name

EIEN/SUICOM

Application

EIEN: Embedded concretemolds, radioactive waste
containers
SUICOM: Vegetation blocks,
foundation blocks

Benefits
Incorporating special cement additives, EIEN can densify the internal structureof concrete by reacting with carbonate ions. In addition to absorbing CO2 in its
production process, it helps prolong the lives of buildings, thereby reducing CO2
emitted from demolition and construction processes.
During production, SUICOM absorbs CO2 and thereby hardens concrete thanks
to carbonization caused by a special cement additive made using slaked lime,
which generates no CO2 even at the raw material stage.

Category

Department

Product Name

Application

steelworks and thermal power generation plants as raw materials.

DENKA ∑1000, 2000, 6000

Concrete piles, propulsive
pipes, box culverts, highstrength piles, pillars forbuildings, concrete secondary
products, cast-in-place
concrete• When supplemented with ∑1000 and 2000, high-strength concrete can bemade through steam curing. These products also perform well with blast
furnace cement made of recycled steel slag. Concrete made of blast furnace
cement supplemented with ∑1000 boasts approximately 40% or lower CO2
emissions intensity than autoclave cured cement.
• ∑6000 reduces high-strength concrete’s CO2 emissions intensity by morethan 30%. Moreover, the concrete produced boasts superior abrasion
resistance and durability and can be recycled multiple times.
• This product effectively utilizes the industrial byproducts of steelworks andBenefits
An ultra-high strength fiber-reinforced concrete that significantly reduces
construction expenses and life cycle costs by facilitating the construction oflighter, stronger structures

Special Cement
Additives Dept.

SUQCEM

Special Cement
Additives Dept.

DENKA SOIL PACK SP20,
SP2000

Soil stabilization materials that strengthen soft ground by causing dehydration
when mixed directly into the soil.

Special Cement
Additives Dept.

ES, ES-L

Boasting high durability, these cement-based quick-hardening materials accelerate
the solidification and hardening of cement in terrestrial grouting work performed
during construction.

Special Cement
Additives Dept.

DENKA Colloidal Super

Special Cement
Additives Dept.

DENKA S packA grout additive used as the primary injection material in the dual-tube double
packer grouting method aimed at stabilizing ground, preventing water intrusionand countering soil liquefaction

Special Cement
Additives Dept.

CG1000, CG2000

Hardening materials with plasticity, used as cavity sealants for soil improvement
work

Agri-Products Dept.

AZUMIN (Magnesium Humate
soil fertilizer)

Concrete precast products• These products effectively utilize industrial byproducts emitted fromSpecial Cement
Additives Dept.

Save resource and energy

Soil liquefaction
countermeasures

Boasting high strength and durability as well as excellent permeability, this superfine powder cement additive is used in terrestrial grouting work.

thermal power generation plants as raw materials.
Special Cement
Additives Dept.

F-DAC

Additive used for vibratingcompaction• F-DAC helps shorten time required for the pre-curing and steam curing

processes, thereby contributing to the reduction of CO2 emissions. It
also performs well with blast furnace cement made from recycled steelslag. Concrete produced using blast furnace cement and F-DAC boasts
approximately 40% lower CO2 emissions intensity than steam-cured concrete.
• This product effectively utilizes industrial byproducts emitted from steelworks

Special Cement
Additives Dept.

Shotcrete (high strength and low
dust generation)

Special Cement
Additives Dept.

DENKA slurry shot method(NATMIC US-32, US-50)

Shotcrete for tunnels

This method applies quick-hardening cement as a shotcrete for tunnel
construction. It reduces dust and concrete splash during the spraying process,thereby helping to improve the workplace environment while decreasingmaterial loss.

Special Cement
Additives Dept.

Clear shot method (NATMIC
LSA, USS)

Shotcrete for tunnels

Employing quick-hardening cement with a low alkaline content, this method
improves the workplace environment in tunnel construction. By reducing dust
and concrete splash, it also helps to decrease material loss during the spraying
process.

Special Cement
Additives Dept.

Cement Dept.

18

NATMIC (T-10)

and thermal power generation plants as raw materials.
• NATMIC hardens quickly and thus is used as a shotcrete for tunnel
construction. It also performs well with blast furnace cement made withrecycled steel slag. When this product is added into blast furnace cement, theresulting concrete’s CO2 emissions intensity is approximately 50% lower thanthat of other type of concrete supplemented with the product.

Electrochemical repair

DENKA Cement

Countermeasure against
concrete deterioration due toneutralization and salt damage,etc., DENKA TECHNOCRETE
SYSTEM

Desalination (electrochemical repair) is an environment-friendly repair method
capable of reducing CO2 emissions by approximately 30% compared withconventional surface repair methods. Moreover, a surface coating applied after
the repair reduces the need for future repairs as well as CO2 emissions over a
structure’s useful life.

Utilization of industrial waste

With the aim of contributing to a recycling-oriented society, this product utilizes
waste produced by nearby municipal bodies and industrial byproducts as raw
materials and fuels for cement production. It also utilizes ash derived from the
combustion of scrap wood in a biomass boiler that powers the Omi Plant’s
production system.

Special Cement
Additives Dept.

Super Cement

Emergency repair of roads,
railways and airports

This ultraquick-hardening concrete gains practical strength over a short time
period, helping to restore the transportation infrastructure quickly at the timeof emergency.

Special Cement
Additives Dept.

F-DAC B-FORM

Concrete secondary products

Facilitating the hardening and solidification of concrete, this cement additive
shortens curing time while reducing fuel use, thereby enhancing production
efficiency and cost effectiveness.

Special Cement
Additives Dept.

SUNTIGHT T-K, T-F

Repair and maintenance ofsewage systems

This acid-resistant mortar for repair and maintenance use can enhance sewage
systems’ durability, preventing the deterioration of concrete due to sulfuric acid
exposure.

DENKA GROUP CSR REPORT 2014

Fertilizer, agrochemicals

When mixed into desalinized soil, AZUMIN humic acid fertilizer improves
agricultural yields, thereby helping restore farmland damaged by tsunami.

In addition to being used as a fertilizer, calcium cyanamide was certified under
the Japanese government’s J-Credit Scheme for its ability to lower emissions of
N2O attributable to the use of nitrogen fertilizers by more than 39% when it isemployed as a supplement (24% or greater ratio) to such fertilizers.*
Agri-Products Dept.

Calcium cyanamide

Fertilizer, agrochemicals*A study conducted by the National Agriculture and Food Research Organization
has estimated that the use of supplemented fertilizer in tea plantations
countrywide would have a GHG reduction effect equivalent to the planting of
200 million cedar trees. (The global warming potential of N2O is approximately
300 times greater than that of CO2)

Inorganic Products
Dept.

Synthetic FLUX COMPOUND

Desulfurizing agent, deoxidizing
agent

Product lineup includes Eco FLUX, which contains no fluorine, anenvironmentally harmful chemical.

Inorganic Products
Dept.

DENKA ALCEN

Automobile parts (catalyst
holder), materials for heating
furnaces and industrial furnaces

This alumina fiber, which is used to hold catalysts that purify automobile
exhausts, helps reduce the weight of automotive parts by facilitating the switchfrom cast iron to aluminum, thereby enhancing fuel efficiency.
It is also used as a thermal insulator for furnaces and is helping reduce heatloss. When used in fire-resistant linings, the product reduces the need for
repair work as it boasts greater heat resistance than that of ceramic fibers.

Inorganic Products
Dept.

Alumina cement

Steelmaking and refining of
non-ferrous metals

Boasting superior heat resistance, this product is used in fire-resistantmaterials for such equipment as steel ladles, helping enhance their heatinsulating properties.

DENKA GROUP CSR REPORT 201419

Reference

Reference

The DENKA Group’s Environment-Friendly Products and Technologies

Initiatives with Our Stakeholders

Category:

Protect the environment

Improve the operational environment

Reduce weight of finished goods

Save resource and energy

Contribute to society

Elastomers & Performance Plastics Division
Category

Department
Elastomers &Acetylene Black
Dept.

Product Name

DENKA BLACK

Application
Lithium-ion secondary
cells (conductive aid,
activating agents forelectrodes)

Benefits

Ultra-pure electro-conductive carbon black used as a conductive aid forelectrodes to enhance battery performance

20

The CSR Procurement Policies

Elastomers &Acetylene Black
Dept.

DENKA BLACK

Tire bladders

Incorporated in bladders* used in the manufacture (vulcanization) of tires toimprove heat conductivity and thus shorten vulcanization time and contributeto energy savings* A balloon-like device that inflates and applies pressure to hold the rubber
against the tire mold

Elastomers &Acetylene Black
Dept.

DENKA CHLOROPRENE

Gaskets for solar cells,
vibration insulation
rubber for wind power
generation, charging
cables for electric vehicles

Due to its flame resistance and ability to control vibrations, this product is usedin gaskets for solar cells installed on housing rooftops and charging cables forelectric vehicles in addition to as vibration insulation rubber for wind turbine
nacelles (covers that house power generation components).

1. We will maintain respect for human rights while striving to improve theworkplace environment and occupational safety and health.
2. We will pursue environment-conscious procurement, striving to securesafety and to reduce our impact on the earth’s environment.
3. We will undertake procurement activities based on compliance with relevant laws, regulations and corporate ethics.
4. We will purchase raw materials and equipment and consign construction
work by comprehensively taking into account such factors as quality,
prices and delivery time as well as suppliers’ technological capabilities,
supply reliability and their environmental conservation initiatives.

Elastomers &Acetylene Black
Dept.

Chloroprene latex

Aqueous adhesives

This product facilitates a changeover in chloroprene-based adhesive solventsfrom volatile organic compound (VOC) to aqueous solutions, thereby helping
reduce environmental burdens and improve the workplace environment.

The CSR Procurement Guidelines

Performance
Plastics Dept.

CLEAREN

Food packaging materials

CLEAREN can be processed at a temperature 50C° lower than that of its
competitor PET-G, while also being 20% lighter than PET-G, thereby reducing
energy use in processing and transportation.

Performance
Plastics Dept.

MS Polymer

Transparent molded resin
products

Incorporating PS as an ingredient, MS Polymer is 6% lighter than resins used
for the same applications that consist only of PMMA, and therefore requires
less energy in transportation.

Application

Benefits

Life Science & Environment Products Division
Category

Supply Chain

Department

Product NameHouseholdPackaging Materials
Dept.

SOFRIA

Food containers

Lighter than its competitor A-PET, SOFRIA helps reduce container weight andtransportation costs.

DENKA Polymer
Co., Ltd.

Easy Disposal Pack

Food packaging

The Easy Disposal Pack helps reduce the weight of food packaging whilecurbing the bulk of household waste as it can be easily compressed after use.

Environmental Film
Dept.

DENKA DX FILM

Back sheets for solar
panelsA fluorine-based film that boasts superior weather-resistance and thus helps
enhance the durability of back sheets for solar panels

Housing &Environmental
Materials Dept.

Rain Oasis

Rainwater storage system

Used to collect rainwater through rain gutters. Collected rainwater may be used
for watering the garden, cooling pavements and washing cars, contributing to
the effective utilization of water resources.

Housing &Environmental
Materials Dept.

TOYODRAIN

Corrugated pipes
for construction andagricultural use

Used in construction and farmland development, TOYODRAIN contributes to theeffective utilization of water resources.

Housing &Environmental
Materials Dept.

TOYO GUTTERS

Rain gutters for housing
and buildings

Protecting structures while contributing to the effective utilization of rainwater

Medical Science
Dept.

Macromolecular sodium
hyaluronate preparation

Joint function
improvement agent

Helping maintain quality of life by improving joint function

DENKA GROUP CSR REPORT 2014

1. Respect for Human Rights and Occupational Safety and Health:A supplier is required to include respect for fundamental human rights
and the pursuit of occupational safety and health in its corporate policy.
2. Compliance with Laws and Regulations: A supplier is required to include compliance with law and regulations, as well as fair corporate activities in accordance with social ethics, in its corporate policy.
3. CSR Promotion: A supplier is required to recognize CSR as being integral to its business activities. This entails including sustainable social andbusiness development in its corporate policy and establishing an inhouse CSR promotion structure.
4. Environmental Conservation: A supplier is required to include environmental conservation activities in its corporate policy and disclose thestatus of said activities to the general public. The said activities include
the appropriate management of chemical substances contained in its
products and green procurement.

5. We will sincerely engage with our suppliers and treat them as importantbusiness partners, fostering mutual understanding and trustworthy relationships with them through fair business transactions.
6. We will not accept from our suppliers nor provide them with any gifts orentertainment of value that are deemed in excess of social norms or of an
inappropriate nature.
7. We will not divulge any non-public information acquired in confidence
from our suppliers in the course of procurement activities while properly
managing and protecting their intellectual property rights.
8. We will maintain an equal partnership with all suppliers and provide themwith equal opportunities for competition in a fair manner.

5. Product Quality and Safety: A supplier is required to include quality andsafety assurance in its corporate policy. Such activities are expected totake place under an established product quality management system.
6. Fair and Just Business Transactions: A supplier is required to include
fair and just business transactions in its corporate policy.
7. Risk Management: A supplier is required to make sure that any risk orcontingencies it may confront are managed and controlled through suchmeans as the appropriate and timely information disclosure.
8. Contribution to Society: A supplier is required to include proactive contribution to local communities and global society in its corporate policy.
9. Severing Ties with Antisocial Forces: A supplier is required to not have
any relationship with antisocial forces, whether they are individuals or
entities.

Life Cycle Assessment (LCA) Initiative
We are promoting LCA for our mainstay products with an eye to ensuring the sustainability of our corporate activities. In doing so,
we are striving to utilize LCA as a means of promoting energy saving and CO2 reduction.
Main Achievements and Ongoing Initiatives:• Completed LCA for 47 mainstay products (resin-based andinorganic products as well as electronic materials)• Promoting the assessment of the direct and indirect effects ofenvironment-friendly products designed to help reduce
environmental burdens through their life cycles• Participating in the carbon-Life Cycle Analysis (c-LCA)
Committee hosted by the Japan Chemical Industry Association• Providing LCA-related information in response to customers’
requests• Held LCA presentation meetings at the following business sites
to report the results of relevant LCA initiatives
The Shibukawa Plant (March 13, 2013)
The Isesaki Plant (May 28, 2013)
The Ofuna Plant (August 21, 2013)

LCA presentation meetings(the Shibukawa Plant)

LCA presentation meetings(the Ofuna Plant)

DENKA GROUP CSR REPORT 201421

Reference

Reference

Initiatives with Our Stakeholders

Corporate Officers (as of April 1, 2014)
Board of Directors / Audit & Supervisory Board / Executive Officers

Local Communities
Main Educational Support Initiatives Undertaken by the DENKA Group (Fiscal 2013)
The Innovation Center and Head Office

Experimental Science
Classes

Plant Tours

Internship
Other Initiatives

The Summer Holiday Chemical Experiment Show for Children sponsored by the “Dream Chemistry 21” committee

The Omi Plant

Geomaru & Nuna to Omoshiro Science

The Omuta Plant

On-demand lectures at Tenryo Elementary School and Meiji Elementary School as well as the Omuta Ecotown Fair

The Shibukawa Plant

Kanashima Elementary School and Shibukawa Technical High School

The Ofuna Plant

Yamasaki Elementary School

The Innovation Center

Tadao Elementary School and Machida Dai-Yon Elementary School

The Omuta Plant

Miike Community Study Group, “child reporters” from Nishi Nihon Shimbun Newspaper, Miike Technical High School and
Miyakonojo National College of Technology

The Chiba Plant

Wakamiya Elementary School, Takushoku University Koryo High School, Tateyama Sogo High School and plant tours for
local elementary school students held in cooperation with other locally based companies

The Shibukawa Plant

Shibukawa Technical High School

The Ofuna Plant

Kamakura Jogakuin Junior High School

The Chiba Plant

Chiba Technical High School
Sponsoring the Fureai Trio’s classical music concerts at elementary schools nationwide

Head OfficeHolding basketball clinics for children in tandem with the NIIGATA ALBIREX BB

Board of Directors
Representative Director, President ............. Shinsuke Yoshitaka
Representative Director ............................ Hitoshi Watanabe
Director .................................................. Tetsuro Maeda
Director .................................................. Mitsukuni Ayabe
Director .................................................. Shinji Sugiyama
Director .................................................. Hideyuki Udagawa
Director .................................................. Manabu Yamamoto
Director .................................................. Kozo Tanaka (Outside Director)
Director .................................................. Tadashi Hashimoto (Outside Director)

Audit & Supervisory Board
Audit & Supervisory Board Member .......... Hideo Oishi
Audit & Supervisory Board Member .......... Jiro Hiroe
Audit & Supervisory Board Member .......... Toshiaki Tada (Outside)
Audit & Supervisory Board Member .......... Tsunehiro Sasanami (Outside)

Executive Officers
President and Chief Executive Officer ................................Shinsuke Yoshitaka
Senior Managing Executive Officer ....................................Hitoshi Watanabe
Senior Managing Executive Officer ....................................Mitsukuni Ayabe
Managing Executive Officer ..............................................Shinji Sugiyama
Managing Executive Officer ..............................................Hideyuki Udagawa
Managing Executive Officer ..............................................Manabu Yamamoto
Managing Executive Officer ..............................................Shohei Tamaki
Managing Executive Officer ..............................................Norihiro Shimizu
Managing Executive Officer ..............................................Toshiharu Kano
Managing Executive Officer ..............................................Sanshiro Matsushita
Managing Executive Officer ..............................................Kenji Nakano
Executive Officer .............................................................Akihiko Okuda
Executive Officer .............................................................Masaharu Suzuki
Executive Officer .............................................................Ken Koizumi
Executive Officer .............................................................Tetsuya Shinmura
Executive Officer .............................................................Junichi Kimura
Executive Officer .............................................................Toshio Imai

Experimental Science Classes• Summer Holiday Chemical Experiment• Geomaru & Nuna to Omoshiro ScienceShow for Children (the Innovation Centerand Head Office)(the Omi Plant)• Lecture on the science of adhesives at• Experimental science class in spring

Shibukawa Technical High School (theShibukawa Plant)

vacation season (the Shibukawa Plant)• The Omuta Ecotown Fair (the Omuta Plant)• Experimental science class at Kanashima

Elementary School (the Shibukawa Plant)• Yamasaki Elementary School (the Ofuna Plant)• Tadao Elementary School (the Innovation Center)

Plant Tours

22• Members of Miike Community Study• Local elementary school students touring• Plant tour during the summer vacation• Kamakura Jogakuin Junior High School

Group touring the Omuta Plant

the Chiba Plant facilities as a part of a tour
jointly hosted by DENKA and other locally
based companies

season to which employees' families areinvited (the Chiba Plant)

students touring the Ofuna Plant

DENKA GROUP CSR REPORT 2014

DENKA GROUP CSR REPORT 201423

Reference

Consolidated Financial Statements

Consolidated Balance Sheets (Summary)
Account item

Millions of yen

As of Mar. 31, 2014

As of Mar. 31, 2013

AssetsCurrent assets

Consolidated Statements of Income (Summary)
Account item
Net sales

Apr. 1, 2013 toMar. 31, 2014

Millions of yen
Apr. 1, 2012 toMar. 31, 2013

Capital Stock376,809341,645

Balance at April 1, 2013
Changes of items during the period

158,595

Cost of sales

299,671

269,326

Cash and deposits

8,427

10,800

Selling, general andadministrative expenses

55,90853,501

Notes and accounts
receivable, trade

83,701

77,111

21,23018,817

Inventories

62,81660,712Non-operating income

3,595

3,414

Other

10,107

10,474Non-operating expense

4,221

4,407

Allowance for doubtful
accounts
Non-current assets
Property, plant and equipment

(305)

(503)

266,599

256,761

Ordinary income
Extraordinary losses
Income before income taxes
and minority interests

Millions of yen
Shareholders’ Equity

164,747

Operating income

Consolidated Statement of Shareholders’ Equity (April 1, 2013 to March 31, 2014)

13,573

13,573Purchase of treasury stock
Disposal of treasury stock590

Net changes of items other thanshareholders’ equity

20,322

17,233

Total changes of items during theperiod

5,776

5,959

1,243

Income taxes—current

Investment securities

46,562

42,665

Income taxes—deferred

858

(132)

Other

7,016

6,786

Minority interests in income

114

151

13,573

11,255

165,043

Net income

281

1,299

Total Shareholders’ Equity(1,933)(4,704)

17,824

Intangible fixed assets

Treasury Stock80,693(4,704)20,604

206,214Retained Earnings

49,284

Dividends from surplus

Reversal of revaluation reserve forland

211,783

Capital Surplus

36,998(3,018)(3,018)

0

1

0
(1)

(1)
–

Balance at March 31, 2014

–

0

8,868

(3,018)5,850

36,99849,28489,562(4,951)

170,894

Other Accumulated Comprehensive Income
Allowance for doubtful
accounts
Total assets

(61)

(148)

431,347

415,356

Liabilities
Current liabilities

Net income

Balance at April 1, 2013

Consolidated Statements of Comprehensive Income
163,645

170,752

Notes and accounts payable,
trade

54,23855,226

Short-term loans

50,00647,085

Commercial paper

10,00014,000Current portion of bonds

5,000

10,000

Other current liabilities

44,401Long-term liabilities

Valuation Difference
Revaluation Reserve
on Available-for-Salefor Land
Securities

Account item
Income before minority
interests

Apr. 1, 2013 toMar. 31, 2014

Millions of yen
Apr. 1, 2012 toMar. 31, 2013

13,688

11,406

Other comprehensive income

7,516

Remeasurementsof Defined Benefit
Plans

Total Valuation
and Translation
Adjustments

Minority Interests

Total Net Assets(2,623)–

13,957

1,707

180,709

9,064

Changes of items during the period
Dividends from surplus–(4,704)

Net income–

13,573Purchase of treasury stock–(3,018)

Disposal of treasury stock–1

Reversal of revaluation reserve for
land

–

(1)

Valuation difference on
available-for-sale securities

1,133

2,380

44,440

Deferred gains or losses onhedges–1

Net changes of items other thanshareholders’ equity

1,123

1

3,103

(1,422)

2,805

150

2,956

78,18563,894

Revaluation reserve for land––

Total changes of items during theperiod

1,123

1

3,103

(1,422)

2,805

150

8,806

Bonds payable

25,00015,000Foreign currency translation
adjustments

3,128

1,357

Balance at March 31, 2014

8,640

9,065

479

(1,422)

16,762

1,858

189,516Long-term loans payable

30,66328,156

Other

22,522

20,7383680

241,831234,647

Share of other comprehensive
income of associates
accounted for using equity
methodTotal other comprehensive
income

4,297

3,820

Total liabilities
Net Assets
Shareholders’ equity

170,894

165,043

Comprehensive Income

Capital stock

36,99836,998(Breakdown)

Capital surplus

49,28449,284Retained earnings

89,56280,693

Treasury stock(4,951)(1,933)

Accumulated othercomprehensive income

16,762

13,957

Minority interests

1,858

1,707

Total net assets

189,516

180,709

Total liabilities and net assets

431,347

415,356

Consolidated Statements of Cash Flows (Summary)
Account item
17,986

15,227

Comprehensive income
attributable to owners of theparent17,80015,033Comprehensive income
attributable to owners of theminority interests

186

194

DENKA GROUP CSR REPORT 2014

Millions of yen
Apr. 1, 2013 toMar. 31, 2014

Apr. 1, 2012 toMar. 31, 2013

Net cash provided by operating activities

27,24540,215

Net cash used in investing activities(26,693)(25,864)

Net cash used in financing activities(3,327)(12,784)

339

153

Net increase (decrease) in cash and cash equivalents(2,436)

1,720

Cash and cash equivalents at the beginning of the year

10,6808,207

Increase in cash and cash equivalents due to the new consolidation of subsidiaries–

481

Increase in cash and cash equivalents due to the merger of non-consolidated subsidiaries

–

270

8,244

10,680Effect of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at the end of the year

24

Foreign Currency
Translation
Adjustments

DENKA GROUP CSR REPORT 2014

25

資料編
Reference

Global Reporting Initiative (GRI) Content Index
製品マネジメントシステム
Disclosure

Please see below to find disclosure information listed in the Sustainability Reporting Guidelines Version 3.1 (G3.1).
Note 1: Ref. = References (PDF), Site = Site Reports (PDF) Note 2: Core indicators are in boldface type.
Disclosure

Location of disclosure

4.8

PART I: Profile Disclosures
1. Strategy and Analysis
1.1

1.2

Statement from the most senior decision-maker of the organization

・To Our Stakeholders (p.4-5)

4.9

Description of key impacts, risks, and opportunities

・To Our Stakeholders (p.4-5)
・DENKA’s Group Operations and CSR (p.8-9)
・DENKA Group’s CSR (p.10-11)
・Our Business Operations (p.12-13)
・Responsible Care (RC) Activities (Ref. p.6)

4.10

Commitments to External Initiatives

2. Organizational Profile
2.1

Name of the organization

・Corporate Profile (p.2)
・Our Business Operations (p.14-17)
・The DENKA Group’s Environment-Friendly Products and Technologies(Ref. p.17-20)
・Corporate Profile (p.2)
・Major Affiliates (Site p.16-26)

4.11

・Corporate Governance (p.24)
・Risk Management (p.25)
・Our Initiatives to Maintain Safe Operations (p.26-27)
Explanation of whether and how the precautionary approach or principle is addressed by the organization
・Supply Chain (p.34)
・Compliance (Ref. p.4)
・Responsible Care (RC) Activities (Ref. p.6)
・ISO 14001 and 9001 Management Systems (Ref. p.7)
Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization
・Product Safety Management System (Ref. p.11-12)
subscribes or endorses
・Occupational Safety and Health Management System (Ref. p.14)
Memberships in associations (such as industry associations) and/or national/international advocacy organizations in which the・Product Safety Management System (Ref. p.12)
organization: * Has positions in governance bodies; * Participates in projects or committees; * Provides substantive funding beyond
・Life Cycle Assessment (LCA) Initiative (Ref. p.21)
routine membership dues; or * Views membership as strategic

2.2

Primary brands, products, and/or services

2.3

Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures

2.4

Location of organization's headquarters

2.5

Number of countries where the organization operates, and names of countries with either major operations or that are ・Corporate Profile (p.2)
specifically relevant to the sustainability issues covered in the report・Overseas Subsidiaries (Site p.16-21)

4.13

2.6

Nature of ownership and legal form

・Corporate Profile (p.2)

Stakeholder Engagement

2.7

Markets served (including geographic breakdown, sectors served, and types of customers/beneficiaries)

–

4.14

List of stakeholder groups engaged by the organization

・With Our Stakeholders (p.34-38)

2.8

Scale of the reporting organization

・Corporate Profile (p.2-3)
・Consolidated Financial Statements (Ref. p.24-25)

4.15

Basis for identification and selection of stakeholders with whom to engage

–

4.16

Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group

4.12

・Corporate Profile (p.2)

2.9

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

・Our Business Operations (p.12-13)

2.10

Awards received in the reporting period・Site Reports (p.7, 11)

4.17

3. Report Parameters

・With Our Stakeholders (p.34-38)
・With Our Stakeholders (Ref. p.21-22)
Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to ・DENKA’s Group Operations and CSR (p.8-9)
those key topics and concerns, including through its reporting・With Our Stakeholders (p.34-38)
PART II: Disclosures on Management Approach (DMAs) and Performance Indicators

Report Profile
3.1

Reporting period (e.g., fiscal/calendar year) for information provided

・Editorial Policy (p.2)
・Our Initiatives to Maintain Safe Operations (p.27)

3.2

Date of most recent previous report

・Previous CSR Reports (PDF)

3.3

Reporting cycle (annual, biennial, etc.)

・Previous CSR Reports (PDF)

3.4

Contact point for questions regarding the report or its contents

・Inquiries (p.2)

3.5
3.6
3.7

3.8

3.9
3.10
3.11

・DENKA’s Group Operations and CSR (p.8-9)
Process for defining report content
・DENKA Group’s CSR (p.10-11)
・With Our Stakeholders (p.34-38)
・Editorial Policy (p.2)
Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers)
・Environmental Conservation (p.28-29)
・Editorial Policy (p.2)
State any specific limitations on the scope or boundary of the report
・Environmental Conservation (p.28-29)
・Corporate Profile (p.2)
・Our Initiatives to Maintain Safe Operations (p.26-27)
Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can・Environmental Conservation (p.28-29)
significantly affect comparability from period to period and/or between organizations
・Initiatives to Secure Our Electricity Supply (p.30-31)
・Site Reports
Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations
・Environmental Conservation (p.28-29)
applied to the compilation of the indicators and other information in the report
Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement–(e.g., mergers/acquisitions, change of base years/periods, nature of business, measurement methods)
Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report

Economic
DMA

Table identifying the location of the Standard Disclosures in the report

EC1
EC2

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

Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and ・Consolidated Financial Statements (Ref. p.24-25)
other community investments, retained earnings, and payments to capital providers and governments
・Consolidated Financial Statements (Japanese only)
・To Our Stakeholders (p.4-5)
Financial implications and other risks and opportunities for the organization's activities due to climate change
・Environmental Conservation (p.28-29)

EC3

Coverage of the organization's defined benefit plan obligations

・Consolidated Financial Statements (Japanese only)

EC4

Significant financial assistance received from government

・Environment- and Energy-Related Subsidies (Ref. p.15)

Market Presence
EC5

Range of ratios of standard entry level wage by gender compared to local minimum wage at significant locations of operation–

EC6

Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation

・Supply Chain (p.34)
・Supply Chain (Ref. p.21)

EC7

Procedures for local hiring and proportion of senior management hired from the local community at significant locations of–operation

Indirect Economic Impacts

・Environmental Conservation (p.29)

EC8・Local Communities (p.38)
Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, ・The DENKA Group’s Environment-Friendly Products andTechnologies (Ref. p.17-20)
in-kind, or pro bono engagement
・Local Communities (Ref. p.22)

・GRI Content Index (Ref. p.26-30)

EC9Understanding and describing significant indirect economic impacts, including the extent of impacts

Assurance
3.13

・Third-Party Opinion (p.39)
DMA

Disclosure on Management Approach

Governance

4.2

4.3

4.4

4.5

4.6
4.7

Governance structure of the organization, including committees under the highest governance body responsible for specific ・DENKA Group’s CSR (p.10)
tasks, such as setting strategy or organizational oversight・Corporate Governance (p.24-25)
・Corporate Governance (p.24-25)
Indicate whether the Chair of the highest governance body is also an executive officer
・Corporate Officers (Ref. p.23)
・Corporate Governance (p.24-25)
For organizations that have a unitary board structure, state the number and gender of members of the highest governance ・Consolidated Financial Statements (Japanese only)
body that are independent and/or non-executive members
・Disclosure on the Internet accompanying the Notice of Convocationof the 155th Ordinary General Meeting of Shareholders
・Corporate Governance (p.24-25)
・Shareholders and Investors (p.35)
Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body・Disclosure on the Internet accompanying the Notice of Convocationof the 155th Ordinary General Meeting of Shareholders
・Consolidated Financial Statements (Japanese only)
Linkage between compensation for members of the highest governance body, senior managers, and executives (including・Disclosure on the Internet accompanying the Notice of Convocation
departure arrangements), and the organization's performance (including social and environmental performance)of the 155th Ordinary General Meeting of Shareholders
・Corporate Governance (p.24-25)
Processes in place for the highest governance body to ensure conflicts of interest are avoided
・Disclosure on the Internet accompanying the Notice of Convocationof the 155th Ordinary General Meeting of Shareholders
Process for determining the composition, qualifications, and expertise of the members of the highest governance body and its ・Disclosure on the Internet accompanying the Notice of Convocationcommittees, including any consideration of gender and other indicators of diversityof the 155th Ordinary General Meeting of Shareholders

DENKA GROUP CSR REPORT 2014

・Fiscal 2013 Overview (p.12)

Environmental

4. Governance, Commitments, and Engagement

4.1

・To Our Stakeholders (p.4-5)
・DENKA’s Group Operations and CSR (p.8-9)
・Our Business Operations (p.12-17)
・Promoting Our R&D Activities (p.18)

Economic Performance Indicators

GRI Content Index
3.12

Disclosure on Management Approach

Economic Performance

Report Scope and Boundary

26

Location of disclosure

・To Our Stakeholders (p.4-5)
・DENKA’s Group Operations and CSR (p.8-9)
Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, ・Fiscal 2013 Overview / DENKA100 New Growth Strategies (p.12-13)
and social performance and the status of their implementation
・Environmental Conservation (p.28)
・Employees (p.36)
・The DENKA Group Guidelines (Ref. p.3)
Procedures of the highest governance body for overseeing the organization's identification and management of economic,
・Corporate Governance (p.24-25)
environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with・Responsible Care (RC) Activities (Ref. p.6)
internationally agreed standards, codes of conduct, and principles
Processes for evaluating the highest governance body's own performance, particularly with respect to economic, environmental, ・Corporate Governance (p.24-25)
and social performance
・Our Initiatives to Maintain Safe Operations (p.26)

・To Our Stakeholders (p.4-5)
・Environmental Conservation (p.28-29)
・Responsible Care (RC) Activities (Ref. p.6)
・Site Reports

Environmental Performance Indicators
Materials
EN1

Materials used by weight or volume–

EN2

Percentage of materials used that are recycled input materials

・Overview of Environmental Impacts (p.28)
・Resource Recycling through Cement Production (p.32-33)

Direct energy consumption by primary energy source

・Overview of Environmental Impacts (p.28)

Energy
EN3
EN4
EN5

EN6
EN7

・Overview of Environmental Impacts (p.28)
・Initiatives to Secure Our Electricity Supply (p.30-31)
・Environmental Conservation (p.28-29)
Energy saved due to conservation and efficiency improvements
・Streamlining Logistics for Further Energy Savings (Ref. p.13)
・To Our Stakeholders (p.4-5)
Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements ・Environmental Conservation (p.28-29)
as a result of these initiatives
・The DENKA Group’s Environment-Friendly Products and Technologies(Ref. p.17-20)
Indirect energy consumption by primary source

Initiatives to reduce indirect energy consumption and reductions achieved

・Environmental Conservation (p.28-29)

DENKA GROUP CSR REPORT 2014

27

資料編
Reference

Global Reporting Initiative (GRI) Content Index
製品マネジメントシステム
Disclosure

Location of disclosure

Water
EN8

Total water withdrawal by source

・Overview of Environmental Impacts (p.28)
・Site Reports

EN9

Water sources significantly affected by withdrawal of water・Initiatives to Secure Our Electricity Supply (p.30-31)

EN10

Percentage and total volume of water recycled and reused–

Biodiversity
EN11
EN12

Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value・Site Reports (p.2)
outside protected areas
Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high–biodiversity value outside protected areas

EN13

Habitats protected or restored

–

EN14

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

–

EN15

Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level–of extinction risk

EN16

Total direct and indirect greenhouse gas emissions by weight・Environmental Conservation (p.28-29)
・Responsible Care (RC) Activities (Ref. p.6, 9-10)・Site Reports

EN17

Other relevant indirect greenhouse gas emissions by weight・Streamlining Logistics for Further Energy Savings (Ref. p.13)

EN18

Initiatives to reduce greenhouse gas emissions and reductions achieved

EN19

Emissions of ozone-depleting substances by weight

NOx, SOx, and other significant air emissions by type and weight

EN21

Total water discharge by quality and destination

EN22

Total weight of waste by type and disposal method

EN23
EN24
EN25

Total number and volume of significant spills

EN27

Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation
Percentage of products sold and their packaging materials that are reclaimed by category

LA11
LA12

Percentage of employees receiving regular performance and career development reviews, by gender

LA13

Composition of governance bodies and breakdown of employees per employee category according to gender, age group,・Employees (p.37)
minority group membership, and other indicators of diversity

Equal Remuneration for Women and Men
LA14

Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation

Disclosure on Management Approach

Investment and Procurement Practices
Percentage and total number of significant investment agreements and contracts that include clauses incorporating human–rights concerns, or that have undergone human rights screening
Percentage of significant suppliers, contractors and other business partners that have undergone human rights screening, and・Supply Chain (p.34)
actions taken
Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations,–
including the percentage of employees trained

HR2
HR3

Non-discrimination
HR4

Total number of incidents of discrimination and actions taken

HR5

Operations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining–
may be violated or at significant risk, and actions taken to support these rights

Child Labor
HR6

HR7

Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to・Supply Chain (Ref. p.21)
contribute to the effective abolition of child labor
Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor, and ・Supply Chain (p.34)
measures to contribute to the elimination of all forms of forced or compulsory labor・Supply Chain (Ref. p.21)

Security Practices
HR8

Percentage of security personnel trained in the organization's policies or procedures concerning aspects of human rights that
・The DENKA Group Guidelines (Ref. p.3)
are relevant to operations

Indigenous Rights

–

HR10

HR9

Total number of incidents of violations involving rights of indigenous people and actions taken

Significant environmental impacts of transporting products and other goods and materials used for the organization's・Streamlining Logistics for Further Energy Savings (Ref. p.13)
operations, and transporting members of the workforce

Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments

HR11

–

Number of grievances related to human rights filed, addressed and resolved through formal grievance mechanisms–

Social: Society

DMA

Disclosure on Management Approach

・Environmental Accounting (Ref. p.16)

・To Our Stakeholders (p.4-5)
・Compliance (p.25)
・Local Communities (p.38)
・The DENKA Group Guidelines (Ref. p.3)
・Compliance (Ref. p.4)
・Site Reports

Society Performance Indicators

Social: Labor Practices and Decent Work
Disclosure on Management Approach

Local Communities
・To Our Stakeholders (p.4-5)
・Human Resource Development (p.22) / Employees (p.36)
・Site Reports

SO1

SO10

Labor Practices and Decent Work Performance Indicators

SO9

Employment

Percentage of operations with implemented local community engagement, impact assessments, and development programs–

・To Our Stakeholders (p.4)
Operations with significant potential or actual negative impacts on local communities
・Report on Accidents at Our Plants (p.6-7)
・Our Initiatives to Maintain Safe Operations (p.26-27)
・To Our Stakeholders (p.4)
Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local
・Report on Accidents at Our Plants (p.6-7)
communities
・Our Initiatives to Maintain Safe Operations (p.26-27)

LA1

Total workforce by employment type, employment contract, and region, broken down by gender・Corporate Profile (p.2)
・Employees (p.37)
・Site Reports

Corruption

LA2

Total number and rate of new employee hires and employee turnover by age group, gender, and region

・Employees (p.37)

SO2

Percentage and total number of business units analyzed for risks related to corruption–

LA3

Benefits provided to full-time employees that are not provided to temporary or part-time employees, by major operations

・Employees (p.36-37)

SO3

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

LA15

Return to work and retention rates after parental leave, by gender

・Employees (p.36)

・Corporate Governance (p.24-25)
・Compliance (Ref. p.4)

SO4

Actions taken in response to incidents of corruption–

Labor/management Relations
LA4

Percentage of employees covered by collective bargaining agreements

・Consolidated Financial Statements (Japanese only)

LA5

Minimum notice period(s) regarding significant operational changes, including whether it is specified in collective agreements–

Occupational Health and Safety
LA6
LA7
LA8

28

–

Assessment

Remediation

SocialDMA–

Freedom of Association and Collective Bargaining

・Our Business Operations (p.14-17)
・Initiatives to Secure Our Electricity Supply (p.30-31)
・The DENKA Group’s Environment-Friendly Products and Technologies(Ref. p.17-20)

Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws–
and regulations

Total environmental protection expenditures and investments by type・To Our Stakeholders (p.4-5)
・Supply Chain (p.34)
・The DENKA Group Guidelines (Ref. p.3)
・Supply Chain (Ref. p.21)

Human Rights Performance Indicators

Forced and Compulsory Labor

Overall
EN30–

Social: Human Rights

Transport
EN29–

Diversity and Equal Opportunity

・Our Initiatives to Maintain Safe Operations (p.26-27)

Compliance
EN28–

Average hours of training per year per employee by gender, and by employee category

Programs for skills management and lifelong learning that support the continued employability of employees and assist them in ・Human Resource Development (p.22-23)
managing career endings
・Employees (p.37)

HR1

Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I,–
II, III, and VIII, and percentage of transported waste shipped internationallyIdentity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting–organization's discharges of water and runoff

Location of disclosure・Employees (p.37)

LA10・To Our Stakeholders (p.4-5)
・Environmental Conservation (p.28-29)
・Streamlining Logistics for Further Energy Savings (Ref. p.13)
・Life Cycle Assessment (LCA) Initiative (Ref. p.21)
・Overview of Environmental Impacts (p.28)
・PRTR Substances (p.29)
・Environmental Conservation (Ref. p.8-10)
・Overview of Environmental Impacts (p.28)
・Environmental Conservation (Ref. p.8-10)・Site Reports
・Overview of Environmental Impacts (p.28)
・Environmental Conservation (Ref. p.8-10)・Site Reports
・Environmental Conservation (p.28-29)
・Environmental Conservation (Ref. p.9-10)・Site Reports

Products and Services
EN26

Health and safety topics covered in formal agreements with trade unions

Training and Education

DMA

Emissions, Effluents and Waste

EN20

Disclosure
LA9

Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor–
and advise on occupational health and safety programs
Rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities by region and by・Our Initiatives to Maintain Safe Operations (p.26-27)
gender
Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or・Employees (p.36-37)
community members regarding serious diseases

DENKA GROUP CSR REPORT 2014

Public Policy
SO5

Public policy positions and participation in public policy development and lobbying

・Environment- and Energy-Related Subsidies (Ref. p.15)

SO6Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country–

Anti-competitive Behavior
SO7

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

Compliance
SO8

Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with laws and regulations –DENKA GROUP CSR REPORT 201429

Reference

Global Reporting Initiative (GRI) Content Index

Disclosure

Location of disclosure

Social: Product Responsibility

DMA

Disclosure on Management Approach・Promoting Further Innovation (p.20)
・Supply Chain (p.34)
・Responsible Care (RC) Activities (Ref. p.6)
・ISO9001 Management System (Ref. p.7)
・Product Safety Management System (Ref. p.11-12)

Product Responsibility Performance Indicators
Customer Health and Safety
PR1
PR2

Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage ・Product Safety Management System (Ref. p.11-12)
of significant products and services categories subject to such procedures
・ISO9001 Management System (Ref. p.7)
Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products ・Supply Chain (p.34)
and services during their life cycle, by type of outcomes
・Product Safety Management System (Ref. p.4-5)

Product and Service Labelling
PR3
PR4
PR5

Type of product and service information required by procedures, and percentage of significant products and services subject to・Our Business Operations (p.14-17)
such information requirements
Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information ・Supply Chain (p.34)
and labeling, by type of outcomes
・Product Safety Management System (Ref. p.4-5)
Practices related to customer satisfaction, including results of surveys measuring customer satisfaction–

Marketing Communications
PR6

PR7

・Shareholders and Investors (p.35)
Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising,・Information Security/System Administration/Online Information
promotion, and sponsorshipManagement (Ref. p.5)
・Shareholders and Investors (p.35)
Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications,・Information Security/System Administration/Online Information
including advertising, promotion, and sponsorship by type of outcomesManagement (Ref. p.5)

Customer Privacy
PR8

Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data–

Compliance
PR930

Monetary value of significant fines for non-compliance with laws and regulations concerning the provision and use of products–
and services

DENKA GROUP CSR REPORT 2014

DENKA GROUP CSR REPORT 201431