ESG Management Undertaken by the Sumitomo Rubber Group

Initiatives Related to Human Capital
Basic Perspective on Human Capital
The Sumitomo Rubber Group is engaged in ongoing investment in
human capital in line with a medium- to long-term human resources
strategy designed to embody our Purpose, “Through innovation wewill create a future of joy and well-being for all,” the foremost component of “Our Philosophy.” Furthermore, based on our Vision of“Uniting our diverse strengths, growing together, driving and thrivingon change,” we aim to create an organization in which every
employee with diverse attributes can feel a robust sense of psychological safety, work vibrantly and achieve success. To this end, we
implement a variety of measures, including promoting diversity &inclusion, enhancing leadership skills of executives and other managerial employees and shifting to human resources systems thatenable employees to choose from a diverse range of workstyle
options. In addition, we also focus on nurturing human resources

who can spearhead digital transformation (DX) and thereby support
our ability to align with the radically evolving corporate environment.
Sumitomo Rubber Group’s Basic Hiring Policy

A diverse
employment
environment andhuman resource
development

A workplaceenvironment
conducive to job
satisfaction

Fair evaluationand equal
benefits

Targets2022
results, etc.

Percentage ofManagement
Positions Heldby Women

Hiring Rateof Women

Percentage ofEmployees with
LGBTQ+ Ally Sticker*

2025

Annually2025

7%20%20%

3.8%

36%

No. of Mentor
System Users

2025

150 persons(cumulative total)

Prepared andbegan distributing
the stickers

49

persons(cumulative total)

Foreign National
Percentage of Male
EmployeeEmployees Who
Questionnaire Score Took Childcare Leave

2030:
Improvement
Across All
QuestionnaireItems

2023

100%

Examples ofquestionnaire items• Whether you feelthat your workplaceis inclusive• Whether robust
educational support
is available

19.9%
Note: 68.8% whenmale employees who
used other relevant
programs are included* A sticker to declare that its bearer is an ally to the LGBTQ+ community

Diversity & Inclusion (D&I)
Our Vision of “Uniting our diverse strengths, growing together, driving
and thriving on change,” another component of “Our Philosophy,”defines our ideals regarding what the Sumitomo Rubber Groupshould look like and informs various measures related to human capital. We will strive to embody “Our Philosophy” by respecting theunique personalities of employees, including invisible differencesamong them, and ensuring that they inspire one another to enhancetheir good traits.
We also place particular emphasis on promoting women’s empowerment, believing that doing so should be the starting point for thecreation of an organization that enables all employees with diverse
backgrounds to realize their full potential. Accordingly, we have positioned women’s empowerment as a priority issue, to this end tackling
both the updating of employee awareness and culture as well as thedevelopment of the working environment and programs.

D&I Top Commitment
In order to live up to the ideals of “Our Philosophy,” the Sumitomo
Rubber Group is actively working to promote mutual greater respectamong all of the diverse employees who make up our group.
The Sumitomo Rubber Group considers “uniting our diverse
strengths and growing together” to be a key management challenge.
With this in mind, we hereby declare the following.
President & Representative Director Sumitomo Rubber Industries, Ltd.

Medium- to Long-Term Vision
The ratio of female managers to the total number of managers, abenchmark for women’s empowerment, amounted to 3.8% at theend of fiscal 2022, falling significantly short of the 7% target we haveset for 2025. This situation is negatively affecting the gender wage
gap, which, at a ratio of 71:100, shows that the average wage paid
to full-time female employees is disproportionately low compared withthat paid to their male peers (based on total wages, including allowances). The wage discrepancy can also be attributed to differences intotal working hours (including overtime hours) among men andwomen as well as job category-linked compensation and the aforementioned difference in the ratio of managers. There are no simple
fixes, a number of obstacles to the promotion of diversity remain. To
overcome these obstacles, we will not only strive to update employee
awareness and culture but also thoroughly review our humanresources systems and implement other medium- to long-term measures going forward.

Satoru Yamamoto
Declaration on the Promotion of D&I
The Sumitomo Rubber Group respects and values the diverse
attributes and ways of thinking of all employees and so shallstrive to create workplaces that enable each individual to harness
their full potential.
• Gender, Sexual Orientation, Gender Identity, Age, Disability, etc.
• Employment Status, Situation of Hiring, etc.
• Place of Birth, Nationality, Race, Ethnicity, Culture, Religion, etc.

Initiatives Related to Human Rights
The Sumitomo Rubber Group has established a Corporate Code ofConduct to protect the human rights of all stakeholders, including
employees. In addition, we clearly communicate to all employees ourpolicy of not tolerating any human rights violations, including discrimination and harassment, irrespective of circumstances.
Among the social issues associated with natural rubber procurement,

violations of workers’ human rights have often been a concern. To
assess the status of human rights assurance and prevent related issues
and risks from materializing, we plan to establish a human rights management (human rights due diligence) structure by the end of 2024.
In 2023, prior to establishing this structure, we will clarify our stanceby publishing the Sumitomo Rubber Group Human Rights Policy.

Promoting Health & Productivity Management
Results and Plan
As we did in the previous fiscal year, in fiscal 2022 we implemented
a mentoring system to assist women in their career development
efforts. From the perspective of promoting women’s empowerment,
we focused on the two aspects of providing career education andhelping them strike an optimal work-life balance. We also focused on
encouraging male employees who are fathers to play greater roles inchild rearing to facilitate a workplace culture that empowers diverse
individuals to pursue success. Furthermore, we carried out activities
to help employees gain a robust understanding of and otherwise
educate them on sexual minorities, including members of theLGBTQ+ community. Other initiatives included ERG activities* undertaken by foreign national employees. In these ways, we conductedvarious measures to further promote diversity.
In fiscal 2023, we will continue implementing the activities
described above even as we strive further to promote D&I. To thisend, we will provide officers, from the President on down, with D&I
education to help them raise their awareness while establishing asystem that nurtures female senior managers. Through these andother efforts, we will solidify top management’s commitment to promoting D&I while cultivating female leaders who may one day
become part of senior management.

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Integrated Report 2023

Specific Examples of Initiatives• Hosted study sessions attended by officers, from the President ondown, to help them understand the importance of women’sempowerment• Implemented employee education on paternity leave and otheractivities to encourage managers to be supportive of staff engaged
in child rearing as part of promoting diversity management• Communicated a policy of correcting a work culture that expects
employees to work excessive hours, replacing it with a working
environment that is friendly to diverse people• Implemented a mentoring system through which female employees
assist younger peers in their career development efforts• Issued a handbook designed to promote understanding of theLGBTQ+ community while providing training to personnel in chargeof job interviews and staff at human resources and general affairs• Introduced a job-based wage-rank system for senior employees* Employee Resource Groups: Voluntary, employee-led groups run by individuals who sharecharacteristics or values

Having announced the “Health & Productivity Management Declaration” to internal and external stakeholders, we have promoted health & productivity management by rallying all business units across theboard, while the Company, employees, the labor union and the Health Insurance Association act incollaboration to the same end. Furthermore, we aim to gear up our efforts to promote health & productivity management by identifying seven priority targets that comprise two long-term priority targetsof “strengthening the industrial hygiene structure” and “fostering a health-oriented corporate culture”
as well as five short- to medium-term priority targets, including “preventing serious symptoms,”“improving lifestyle habits,” “tackling mental health-related issues” and “improving labor productivity.”
As part of measures related to “improving lifestyle habits,” we encourage smoking cessation. FromJanuary 2024 onward, smoking on business premises will be prohibited at all Sumitomo Rubber
Industries bases. Meanwhile, in addition to continuously subsidizing outpatient smoking cessation
treatment, we provide subsidies for an even broader range of anti-smoking medication, including nicotine patches, as well as implement such support measures as smoking cessation guidance furnishedby specialist industrial hygiene staff. Moreover, we will hold events and campaigns to encouragesmoking cessation at each business base. As such, we are developing an environment supportive of
those striving to quit smoking, with all business units across the board working in unison to this end.
In 2023, we were chosen for the seventh consecutive year by the Ministry of the Economy, Tradeand Industry as well as Nippon Kenko Kaigi (Japan Health Council), for certification as an excellent
company under the “2023 Certified Health and Productivity Management Organization Recognition
Program—White 500.”
We were also certified by the Japan Sports Agency for the first time as a “Sports Yell Company” under the agency’s 2023 selection program inrecognition of our corporate initiatives to support and popularize sports activities among employees to help them improve their health.
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ESG Management Undertaken by the Sumitomo Rubber Group

Initiatives Related to Human Capital

Human Resource Development
Encouraging Each Employee to Develop Their Competencies and Take on Challenges to Embody “Our Philosophy”
The Sumitomo Rubber Group aims to realize a working environmentand organizational culture that encourages diverse human resources
to spontaneously develop their careers and competencies andempowers them to earn success. To this end, we are implementinga variety of measures.
As part of measures stipulated under the new Midterm Plan, weare stepping up talent management that better informs the strategic

Development of managementhuman resources

Human resources
capable ofembodying“Our Philosophy”
Human resources
capable of contributing to society

development and allocation of human resources while providing all
employees with IT literacy education to promote digital transformation(DX).
In these ways, we will nurture human resources capable of exercising
forward-looking judgement ahead of changes in the environment,
earning success on the global stage, contributing to society andthereby embodying “Our Philosophy.”

Talentmanagement
Officers
General managers,
plant managers• Executive coaching for senior
management human resources• Management skills(Problem-identification and solving
capabilities and leadership)

Development of specialist
human resources• Design thinking• Scientific thinking (QC)
• Specialist expertise

Development of leadership• 360-degree feedback• Leadership skills• Communication skills (coaching)• Followership

Universal/general knowledge/skills
Managers

Career design
Each employee envisions what they shouldlook like in the future

Assistant managers
foremen• Problem-solving/logical-thinking capabilities• DX literacy• Marketing

Mid-level staff,
team leaders• Global human resourcedevelopment• Empowerment of women• Education to counter
unconscious biases• Accounting/finance• Presentation• Facilitation, etc.

Developing DX-Related Human Resources
We consider nurturing DX-related human resources a priority issue interms of “Laying Groundwork for Growing Lines of Business,” and“Expanding Growing Lines of Business,” both of which constitute pillars of the new Midterm Plan. Accordingly, we aim to ensure that all
employees are equipped with the universal skills and mindset needed
to realize a transition to a DX-driven business management approachand to this end, initiated DX-related human resource training programsin October 2022, targeting all 3,500 administrative staff as part ofresource reallocations. This will, in turn, help us achieve fresh growth.
In the below diagram we illustrate how we define three types ofDX-related human resources. Building on the DX literacy education

provided to all employees, we nurture “business core” humanresources capable of promoting DX in ways that align with the typesof business they handle; “professionals” capable of developing AI
and conducting sophisticated data analysis; and “data engineers”
capable of promoting measures to efficiently collect and utilize necessary data. As we aim to crystallize various DX measures by 2025,
we will strive to complete the development of these human resourcesby that year to establish foundations that will facilitate the transitionof the entire Sumitomo Rubber Group to data-driven decision makingand action.

Business coreProfessionals

Data engineers

Business translators

AI/data scientists

Data management

Number allocated to eachdivision: Approx. 480

Number allocated to eachdivision: Approx. 70

Number allocated to eachdivision: Approx. 300

DX literate human resources capable of utilizing sophisticated digital tools, resolving
business challenges and incorporating DX
into business processes as well as disseminating it in their business divisions

Human resources equipped with the mathematical and statistical knowledge needed toconduct data analysis and capable of performing sophisticated data analysis in the course ofAI utilization and/or program development

Human resources boasting DX-relatedexpertise and capable of introducing andmanaging technologies to collect and process enormous volumes of diverse datafrom within and outside the Group

Empowerment of diverse human resources: Diversity & inclusion
Supervisors,
chargehands

New recruits• Understanding of theLGBTQ+ community• Empowerment of foreign
national employees• Empowerment of senior
employees

DX literacy
All administrative staff (approx. 3,500)

Enhancing our organizational culture

Foundation: “Our Philosophy”
The SRI Way: “Being reliable and worthy of trust,”“Seeking out challenge” and “Valuing one another”• Entrenchment of OurPhilosophy• Encouragement to taking onchallenges• Open-minded workplace• Exercise of leadership• Highly productive operationsaligned with the Sumitomo RubberGroup’s overall strategies

Human Resource Development
The Sumitomo Rubber Group has positioned talent management as apriority measure in terms of the strategic and organizational development of human resources. Accordingly, we have expanded the scopeof talent management to include a wider range of human resources.
We have clarified the requirements for human resources in eachposition and help establish skill enhancement goals for individualemployees. In line with these goals, we implement necessary measures, including training programs, personnel transfer and personnel
relocation in addition to assigning employees to particular projects
and otherwise providing them with opportunities to broaden theirrange of job experience. By doing so, we promote the developmentof human resources over the medium to long term.
At the same time, we have incorporated career design education
into grade-specific training programs to help each employee envision
their future careers. Career design education and talent management
thus constitute the two key components of our human resource
development initiatives.

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Integrated Report 2023

To help employees realize their skill enhancement goals and future
career visions, we provide them with abundant opportunities for
spontaneous learning, for example, optional skill enhancement training, e-learning and correspondence courses.
Moreover, we have expanded the range of employees eligible toreceive leadership development education to include those in
non-managerial positions. This contributes to improving our organizational culture.
With regard to leadership development education for managerial
employees, each year we provide 360-degree feedback sessions
and seminars to all employees in assistant manager positions orabove, including officers, to help them objectively reflect on their leadership styles. Furthermore, every officer is given executive coachingto enhance their ability to exercise leadership as senior executives.
In these ways, we develop an environment that allows all employees to attain ongoing personal growth.

Human resources with a basic knowledge of DX and essential data literacy and capable of resolving problems via the use of digital tools

Systems and Programs Designed to Realize Diverse Work Styles
At Sumitomo Rubber Industries, the work-from-home system wasofficially instituted in December 2022, following the trial-basis introduction of this system during the COVID-19 pandemic. By allowing
employees to occasionally work from home, we will help them raise
their productivity and better balance their work and private lives,
thereby improving employee satisfaction.
In April 2023, we reviewed internal regulations on the shortening ofworking hours. This resulted in the revision of the regulations toenable employees to flexibly switch from working full-time to working
shorter hours, or vice versa. Under the former regulations, employees

who had worked shorter hours and then chose to return to full-time
could not be once again apply for shorter working hours. However,
the above revision has made it possible for employees to shift theirworkstyles more flexibly based on differing needs arising from theirlife stages.
In addition, we have expanded the scope of employees eligible totake non-mandatory paid leave to include term-contract and othernon-full-time employees while promoting the use of the flextime system. In these and other ways, we are striving to develop various systems that can be casually used by diverse employees.

Enhancing Our Organizational Culture
Since 2019, we have striven to enhance our organizational culture bypromoting a project that implements four essential policies, namely,“developing an environment supportive of those who take on challenges,” “creating an open-minded workplace free of boundaries
between departments and grades,” “enabling each individual toexercise leadership” and “pursuing highly productive operationsaligned with Groupwide strategies.”
We also strive to periodically assess the status of our entire
organization by, for example, conducting questionnaires on organizational culture. In these ways, we implement various measures totransform our organizational culture.

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