N I S SA N C H E M I C A L I N T E G R AT E D R E P O R T 2 018

https://www.nissanchem.co.jp/eng/

Printed in Japan

Integrated Report 2018

Corporate Ethos Structure
Mission Statement (Our Values)“Contribute to society with excellent technologies and products.”“Promote prosperity and welfare through concerted efforts to constantly develop new areas.”“Respect people who exhibit a sense of responsibility, originality and motivation.”

MissionStatem
ent
(Our
Value
s

Corporate Philosophy (Corporate Purpose))

We contribute to society in harmony with the environment,

Corpo

based on our excellent technologies, products and services.

rate P

(Corp

orate

Corporate Visionhiloso

Purpo

se)

phy

A corporate group that contributes to human survival
and development.

Corpo

rate V
ision

Basic

CSR

PolicyWhere it all begins.
Our goal is to fill the world with hope and happiness.
Our value is to produce a whole new excitement utilizing our imaginationand creativity.
Our pride is our team of specialists believing in the infinite possibilities ofchemistry and striving to achieve the impossible.
We are Nissan Chemical, an ever evolving company the world can’t dowithout.

Basic CSR Policy(1) Conduct sensible business activities as a member of the international
community in compliance with laws and regulations.
(2) Enhance corporate value by providing safe and useful products and services.
(3) Strive to achieve no-accidents & no-disasters and protect the global environment.
(4) Disclose information appropriately with a focus on communication with stakeholders.
(5) Create a cheerful and pleasant workplace by respecting the individuality andpersonalities of employees.

〔Corporate logo〕(6) Conduct ourselves as good corporate citizens and decent members of society.

This symbol designed in the motif of “N” and shining star describes the integration ofcreativity and the accumulation of infinite ideas that makes Nissan Chemical continue togrow by new finding. Its color, emerald green shows intelligence and credibility.
01

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201802

Corporate Ethos Structure
Mission Statement (Our Values)“Contribute to society with excellent technologies and products.”“Promote prosperity and welfare through concerted efforts to constantly develop new areas.”“Respect people who exhibit a sense of responsibility, originality and motivation.”

MissionStatem
ent
(Our
Value
s

Corporate Philosophy (Corporate Purpose))

We contribute to society in harmony with the environment,

Corpo

based on our excellent technologies, products and services.

rate P

(Corp

orate

Corporate Visionhiloso

Purpo

se)

phy

A corporate group that contributes to human survival
and development.

Corpo

rate V
ision

Basic

CSR

PolicyWhere it all begins.
Our goal is to fill the world with hope and happiness.
Our value is to produce a whole new excitement utilizing our imaginationand creativity.
Our pride is our team of specialists believing in the infinite possibilities ofchemistry and striving to achieve the impossible.
We are Nissan Chemical, an ever evolving company the world can’t dowithout.

Basic CSR Policy(1) Conduct sensible business activities as a member of the international
community in compliance with laws and regulations.
(2) Enhance corporate value by providing safe and useful products and services.
(3) Strive to achieve no-accidents & no-disasters and protect the global environment.
(4) Disclose information appropriately with a focus on communication with stakeholders.
(5) Create a cheerful and pleasant workplace by respecting the individuality andpersonalities of employees.

〔Corporate logo〕(6) Conduct ourselves as good corporate citizens and decent members of society.

This symbol designed in the motif of “N” and shining star describes the integration ofcreativity and the accumulation of infinite ideas that makes Nissan Chemical continue togrow by new finding. Its color, emerald green shows intelligence and credibility.
01

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201802

Editorial Policy

CO NTE NTS

In 1992, we introduced responsible care activities, and have disclosed the details of these activities via Environmental and Safety Report since 1999, CSR Report since 2013 and Annual

02 ・・・・・・・・・・・・・・・・Corporate Ethos Structure

57 ・・・・・・・・・・・Efficient Use of Water Resources / Control of Waste Water

Report in which business overview and financial section were included since 2016.

03 ・・・・・・・・・・・・・・・・Editorial Policy

58 ・・・・・・・・・・・Control of Exhaust Gas and Reduction of Emissions of VOCs,

This year, we have included the materiality, process of value creation, and detailed financial information in addition to the business overview, E (Environmental), S (Society), and G

05 ・・・・・・・・・・・・・・・・Corporate History (Nissan Chemical History)
Financial Highlights

59

Non-Financial Highlights

61

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(Governance) information to make this integrated report easier to understand creating medium to long-term value of Nissan Chemical Group to all stakeholders, including shareholders

07

and investors.

09

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FY2017 (April 2017 to March 2018)*The occupational accidents data is from January to December 2017 (P62)

Scope of reporting
The initiatives are described mainly in the financial and ESG information of theactivities of Nissan Chemical Group.
*Financial data includes the data of Nissan Chemical Corporation, consolidated
subsidiaries and entities accounted for using equity method. Non-consolidated coverage
ratio for the Group is 76% (percentage of net sales).
*Non-financial data are for Nissan Chemical Corporation only.

Cautionary Statements Regarding Forecasts.

Consolidated subsidiaries:
Nissei Corporation, Nissan Butsuryu Co., Ltd., Nissan Green & Landscape Co., Ltd.,
Nissan Engineering, Ltd., Nihon Hiryo Co., Ltd., Nissan Chemical America
Corporation (NCA), Nissan Chemical Europe S.A.S. (NCE), NCK Co., Ltd. (NCK)Sun Agro Co., Ltd., Clariant Catalysts (Japan) K.K.

Group companies:
The above consolidated subsidiaries and entities accounted for using equity method,
Environmental Technical Laboratories, Ltd., Nissan Chemical Taiwan Co., Ltd. (NCT),
Nissan Chemical Product (Shanghai) Co., Ltd. (NCS),
Nissan Chemical Agro Korea Ltd. (NAK), Nissan Chemical Do Brasil (NCB),
Nissan Agro Tech India PVT. LTD. (NAI), Nissan Chemical Materials Research (Suzhou)Co., Ltd. (NSU)

11
15

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Communication with Society

Message from the President“Progress2030” Long-Term Business Plan and65“Vista2021” Mid-Term Business Plan

65 ・・・・・・・・・・・・・・・・Relationships with Customers

Commitment to and Communication with Stakeholders

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19 ・・・・・・・・・・・・・・・・Identified Materiality

67 ・・・・・・・・・・・・・・・・Relationships with Business Partners

21

68 ・・・・・・・・・・・・・・・・Relationships with Shareholders and Investors

Process of Value Creation

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69 ・・・・・・・・・・・・・・・・Relationships with Communities and Society
71 ・・・・・・・・・・・・・・・・Relationships with Employees

23 ・・・・・・・・・・・・・・・・Nissan Chemical Products that Play an Active Role in Society
25 ・・・・・・・・・・・・・・・・Environmentally Friendly Products

Financial Section
75

Business Overview
27 ・・・・・・・・・・・・・・・・Performance Materials
29

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31

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Financial Review

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84 ・・・・・・・・・・・・・・・・Notes to Consolidated Financial Statements
90 ・・・・・・・・・・・・・・・・Independent Auditor’s Report

Agricultural Chemicals
Pharmaceuticals

Corporate Information

33 ・・・・・・・・・・・・・・・・Chemicals

91 ・・・・・・・・・・・・・・・・Domestic and Overseas Bases

35 ・・・・・・・・・・・・・・・・Advanced Materials & Planning

94 ・・・・・・・・・・・・・・・・Corporate Profile / Share Information

37

The forward-looking statements contained in this report are based on information currently
available. Accordingly, the actual results may vary significantly depending on changes invarious important factors.

Safety and Disaster Prevention, Occupational Safety and HealthStrategy
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Main Products

Entities accounted for using equity method:

Biodiversity Conservation

63 ・・・・・・・・・・・・・・・・Chemicals and Products Safety

We aim to make this report as a valuable communication tool by deepening our business activities and enhancing the content of this report.

Reporting period

Waste, and Emissions of PRTR Substances
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Research and Development

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95 ・・・・・・・・・・・・・・・・GRI Content Index
Corporate Governance
39 ・・・・・・・・・・・・・・・・Corporate Governance
39 ・・・・・・・・・・・Directors and Auditors
41 ・・・・・・・・・・・Basic Philosophy / Corporate Governance System
42 ・・・・・・・・・・・Policy and Procedures in the Nomination of Officer Candidates
43 ・・・・・・・・・・・Officers’ Remuneration / Effectiveness Evaluation of Boards
44 ・・・・・・・・・・・・・・・・Promotion of CSR
45 ・・・・・・・・・・・・・・・・Compliance
47 ・・・・・・・・・・・・・・・・Risk Management
Responsible Care (RC) Activities
49● Issued: November 2018

CSR & Public Relations Office, Corporate Planning Department, Nissan Chemical Corporation

planned to be issued in October 2019)

TEL: +81-3-4463-8123● Frequency of issuance: Annually

E-mail: csr_pr@nissanchem.co.jp

49 ・・・・・・・・・・・RC Management System
50 ・・・・・・・・・・・RC Basic Policy / RC Audits
51 ・・・・・・・・・・・Promotion of the RC Mid-Term Plan (FY2016-2021)
53 ・・・・・・・・・・・・・・・・Environment Safety and Climate Change Strategy● Guidelines used as reference

53 ・・・・・・・・・・・Environmental Impact from Business Activities

・International Integrated Reporting Council (IIRC) “International <IR> Framework”

54 ・・・・・・・・・・・Environmental and Safety Accounting

・GRI Sustainability Reporting Guidelines Standard
・ISO26000
・Ministry of the Environment “Environmental Accounting Guidelines 2005”03● Contact for inquiries about this report(The previous edition was issued in November 2017, and the next edition is

RC Management

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Nissan Chemical Corporation Integrated Report 201855 ・・・・・・・・・・・Reduction of Greenhouse Gas Emissions
56 ・・・・・・・・・・・Amount of Energy Consumption and Energy Consumption Rate

Nissan Chemical Corporation Integrated Report 201804

Editorial Policy

CO NTE NTS

In 1992, we introduced responsible care activities, and have disclosed the details of these activities via Environmental and Safety Report since 1999, CSR Report since 2013 and Annual

02 ・・・・・・・・・・・・・・・・Corporate Ethos Structure

57 ・・・・・・・・・・・Efficient Use of Water Resources / Control of Waste Water

Report in which business overview and financial section were included since 2016.

03 ・・・・・・・・・・・・・・・・Editorial Policy

58 ・・・・・・・・・・・Control of Exhaust Gas and Reduction of Emissions of VOCs,

This year, we have included the materiality, process of value creation, and detailed financial information in addition to the business overview, E (Environmental), S (Society), and G

05 ・・・・・・・・・・・・・・・・Corporate History (Nissan Chemical History)
Financial Highlights

59

Non-Financial Highlights

61

・
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・
・
・
・
・
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・
・

(Governance) information to make this integrated report easier to understand creating medium to long-term value of Nissan Chemical Group to all stakeholders, including shareholders

07

and investors.

09

・
・
・
・
・
・
・
・
・
・
・
・
・
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・

FY2017 (April 2017 to March 2018)*The occupational accidents data is from January to December 2017 (P62)

Scope of reporting
The initiatives are described mainly in the financial and ESG information of theactivities of Nissan Chemical Group.
*Financial data includes the data of Nissan Chemical Corporation, consolidated
subsidiaries and entities accounted for using equity method. Non-consolidated coverage
ratio for the Group is 76% (percentage of net sales).
*Non-financial data are for Nissan Chemical Corporation only.

Cautionary Statements Regarding Forecasts.

Consolidated subsidiaries:
Nissei Corporation, Nissan Butsuryu Co., Ltd., Nissan Green & Landscape Co., Ltd.,
Nissan Engineering, Ltd., Nihon Hiryo Co., Ltd., Nissan Chemical America
Corporation (NCA), Nissan Chemical Europe S.A.S. (NCE), NCK Co., Ltd. (NCK)Sun Agro Co., Ltd., Clariant Catalysts (Japan) K.K.

Group companies:
The above consolidated subsidiaries and entities accounted for using equity method,
Environmental Technical Laboratories, Ltd., Nissan Chemical Taiwan Co., Ltd. (NCT),
Nissan Chemical Product (Shanghai) Co., Ltd. (NCS),
Nissan Chemical Agro Korea Ltd. (NAK), Nissan Chemical Do Brasil (NCB),
Nissan Agro Tech India PVT. LTD. (NAI), Nissan Chemical Materials Research (Suzhou)Co., Ltd. (NSU)

11
15

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Communication with Society

Message from the President“Progress2030” Long-Term Business Plan and65“Vista2021” Mid-Term Business Plan

65 ・・・・・・・・・・・・・・・・Relationships with Customers

Commitment to and Communication with Stakeholders

・
・
・
・
・
・
・
・
・
・
・
・
・
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・

19 ・・・・・・・・・・・・・・・・Identified Materiality

67 ・・・・・・・・・・・・・・・・Relationships with Business Partners

21

68 ・・・・・・・・・・・・・・・・Relationships with Shareholders and Investors

Process of Value Creation

・
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・

69 ・・・・・・・・・・・・・・・・Relationships with Communities and Society
71 ・・・・・・・・・・・・・・・・Relationships with Employees

23 ・・・・・・・・・・・・・・・・Nissan Chemical Products that Play an Active Role in Society
25 ・・・・・・・・・・・・・・・・Environmentally Friendly Products

Financial Section
75

Business Overview
27 ・・・・・・・・・・・・・・・・Performance Materials
29

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31

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Financial Review

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・
・
・

84 ・・・・・・・・・・・・・・・・Notes to Consolidated Financial Statements
90 ・・・・・・・・・・・・・・・・Independent Auditor’s Report

Agricultural Chemicals
Pharmaceuticals

Corporate Information

33 ・・・・・・・・・・・・・・・・Chemicals

91 ・・・・・・・・・・・・・・・・Domestic and Overseas Bases

35 ・・・・・・・・・・・・・・・・Advanced Materials & Planning

94 ・・・・・・・・・・・・・・・・Corporate Profile / Share Information

37

The forward-looking statements contained in this report are based on information currently
available. Accordingly, the actual results may vary significantly depending on changes invarious important factors.

Safety and Disaster Prevention, Occupational Safety and HealthStrategy
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・

Main Products

Entities accounted for using equity method:

Biodiversity Conservation

63 ・・・・・・・・・・・・・・・・Chemicals and Products Safety

We aim to make this report as a valuable communication tool by deepening our business activities and enhancing the content of this report.

Reporting period

Waste, and Emissions of PRTR Substances
・
・
・
・
・
・
・
・
・
・
・
・
・
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・

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Research and Development

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・

95 ・・・・・・・・・・・・・・・・GRI Content Index
Corporate Governance
39 ・・・・・・・・・・・・・・・・Corporate Governance
39 ・・・・・・・・・・・Directors and Auditors
41 ・・・・・・・・・・・Basic Philosophy / Corporate Governance System
42 ・・・・・・・・・・・Policy and Procedures in the Nomination of Officer Candidates
43 ・・・・・・・・・・・Officers’ Remuneration / Effectiveness Evaluation of Boards
44 ・・・・・・・・・・・・・・・・Promotion of CSR
45 ・・・・・・・・・・・・・・・・Compliance
47 ・・・・・・・・・・・・・・・・Risk Management
Responsible Care (RC) Activities
49● Issued: November 2018

CSR & Public Relations Office, Corporate Planning Department, Nissan Chemical Corporation

planned to be issued in October 2019)

TEL: +81-3-4463-8123● Frequency of issuance: Annually

E-mail: csr_pr@nissanchem.co.jp

49 ・・・・・・・・・・・RC Management System
50 ・・・・・・・・・・・RC Basic Policy / RC Audits
51 ・・・・・・・・・・・Promotion of the RC Mid-Term Plan (FY2016-2021)
53 ・・・・・・・・・・・・・・・・Environment Safety and Climate Change Strategy● Guidelines used as reference

53 ・・・・・・・・・・・Environmental Impact from Business Activities

・International Integrated Reporting Council (IIRC) “International <IR> Framework”

54 ・・・・・・・・・・・Environmental and Safety Accounting

・GRI Sustainability Reporting Guidelines Standard
・ISO26000
・Ministry of the Environment “Environmental Accounting Guidelines 2005”03● Contact for inquiries about this report(The previous edition was issued in November 2017, and the next edition is

RC Management

・
・
・
・
・
・
・
・
・
・
・
・
・
・
・
・

Nissan Chemical Corporation Integrated Report 201855 ・・・・・・・・・・・Reduction of Greenhouse Gas Emissions
56 ・・・・・・・・・・・Amount of Energy Consumption and Energy Consumption Rate

Nissan Chemical Corporation Integrated Report 201804

Corporate History (Nissan Chemical History)
Nissan chemical was founded in 1887 as Japan’s first chemical fertilizer manufacturer.
We contributed to dramatic increases in domestic food production by the enthusiasms and efforts of our pioneers under the founding spirit “to dedicate ourselvesto prosperity of the nation by agricultural fertility”. The pioneering spirit has been still very much alive at Nissan Chemical where we have been working to expand
our business horizons with innovative technologies and projects that will make the world a better place for all.

1887~

(1887)
Tokyo Jinzo Hiryo

1923~(1910)
Dainippon Jinzo Hiryo(1923)(1937)(1949)(Three companies joint)
Nissan Chemical Industries
Nissan Chemical Industries (Spins off oils and fats section)(Participation to Nissan zaibatsu)(1889) Nippon Seimi Seizo
Tokyo Jinzo Hiryo (The Tokyo Artificial Fertilizer Company) started when
Dr. Jokichi Takamine, who is perhaps best known for his discovery of thedigestive enzyme taka-diastase, witnessed the age’s state-of-the-art
chemical fertilizer production technology while studying in England. Uponhis return to Japan, he enlisted the aid of some of the era’s mostsuccessful business tycoons (such as Eiichi Shibusawa and Takashi
Masuda) to launch a groundbreaking business that would revolutionize
Japanese agriculture.

In the first half of the twentieth century, amid a variety of M&A activities bydomestic corporates, we came to turning points with the three companies
joint in 1923 and with the participation to Nissan zaibatsu in 1937.
The three companies joint was a merger of Kanto Soda, Nippon Kagaku
Hiryo (renamed from Nippon Seimi Seizo) and Dainippon Jinzo Hiryo(surviving company).
The Company had been promoting business diversification and enteredunder the umbrella of Nissan zaibatsu in 1937, which was the 50th
anniversary of its foundation, renamed Nissan Chemical Industries.
Nissan zaibatsu was one of the new financial cliques that took over theKuhara Mining (now JXTG Holdings) and was renamed Nippon Sangyo.
It consisted of Nippon Mining in mining sector, Hitachi in the machinery
sector, and Nissan Motor in the automotive sector and so on.

As the plant site, the land in Ojima 1-chome, Koto-ku, Tokyo, now known
as Kamayabori, had been selected for its convenience in transporting raw
materials and products. In 1888, the production of superphosphate(fertilizer) started.
The main raw materials for superphosphate are phosphoric ore andsulfuric acid, and we had been aiming for the in-house production of
sulfuric acid and the development of its derivatives. Then the products
expanded into the industrial chemicals field, manufacturing sulfuric acidand soda products. The later-merged Nippon Seimi Seizo (now Onoda
Plant) was established in 1889 to produce sulfuric acid and soda.

After World War II, under the separation directive based on the Corporate
Reconstruction and Improvement Law, the fat and oil section was
separated into Nippon Oil and Fats (now NOF) in 1949 and Nissan
Chemical Industries newly started.

Nowadays, we provide products and services globally in the four business domains of Information & Communication, Life Sciences, Environment & Energy, andChemicals & Affiliates, while also refining our core technologies that we have cultivated over the years.
We are striving to create products that meet society’s demands.

1965~(1965)
Entering
petrochemical businessIn the 1950s, as domestic imports of petrochemical products expanded
and the momentum for domestic production increased, we establishedNissan Petrochemicals in 1965 and entered the petrochemical business,starting with the production of higher alcohol.

(Toyama Plant electrolytic facilities)(Package of superphosphate)(Toyama Plant sulfuric
acid warehouse)[In 1928, we began integrated ammonia and ammonium sulfate
manufacture at the Toyama Plant. Ammonia was produced throughelectrolysis process of water and continued until 1967.](Advertising in 1891)

1.2

Fertilizer

Petrochemical

3.2

0

05

24.6
0.3
4.9

21.2
1964

Nissan Chemical Corporation Integrated Report 2018

7.1
8.9

Other

127.6

18.8
50

(1994) LANDEL® (anti-hypertension agent)
PERMIT® (herbicide for corn)(1998) ARC® (bottom anti-reflective coating)(2002) Roundup® (nonselective herbicide)(2003) LIVALO® (anti-cholesterol agent)(2005) AdBlue® (high-grade urea solution)(2008) LEIMAY® (fungicide)(2009) STARMITE® (acaricide for fruit trees and vegetables)(2010) Acquisition of Thifluzamide (fungicide)
ORACLE® (fungicide for soil-borne diseases)(2013) ALTAIR® (herbicide for paddy rice)First shipment of fluralaner (active ingredient for
veterinary pharmaceutical)

Net sales by segment

45.8

100

SNOWTEX® (colloidal silica)
Melamine
HI-LITE® (disinfectant)
TEPIC® (epoxy compound)High-purity Sulfuric Acid
TARGA® (herbicide for grassy weeds)
High-purity Ammonia
High purity Nitric acid
SUNEVER® (LCD alignment coating material)
SIRIUS® (herbicide for paddy rice)(1991) SANMITE® (acaricide for fruit trees and vegetables)

In 2018, the Company has already been transcending the framework ofindustry in the development of its business and will accelerate this effort
toward the future. In order to clarify this stance, we changed our name to
Nissan Chemical Corporation.

Note) ARC® is a registered trademark of Brewer Science, Inc., and AdBlue® is a registered trademark of the Verband der Automobilindustrie.

Net Sales by Segment(Non-consolidated) (billion yen)
Chemicals Agrochemicals

The results of continued R&D investment in this difficult situation emerged.
By the early 1990s, a large number of agrochemicals were on the market,
and in the late 1990s, LCD alignment coating materials grew significantly,
while we entered the semiconductor field. In the 2000s, sales of LIVALO®,
anti-cholesterol agent, increased significantly and we acquired exclusive
marketing rights in Japan to ROUNDUP®, the world’s largest herbicide.
Since then, new agrochemicals have been introduced, and in 2013, theshipment of fluralaner, an active ingredient for veterinary pharmaceutical,
which is one of the main products at present, began.

Despite our long-awaited entry into the petrochemical business, theperiod of contribution to incomes was short, resulting in a large deficit.
However, the development of this business brought the penetration oftechnological ideas to the Company, which led to the development of newtechnologies and businesses such as fine chemicals.

(1951)(1964)(1965)(1978)(1979)(1984)(1985)(1987)(1989)(2018)
Nissan Chemical
Corporation

In 1989, we launched our Five-Year mid-term business plan with the aim of
becoming a value-creating enterprise that was unique and R&D oriented
with two pillars: high-tech fields such as agrochemicals andpharmaceuticals, and traditional technology fields such as functional
products and chemicals.

However, the petrochemical industry experienced a structural slump dueto the impact of the two oil crises of the 1970s. The Company worked torebuild its business, but it was unable to improve its profitability andbegan rationalization. The PVC business was transferred to Toyo Soda
Manufacturing (now Tosoh), the higher alcohol and synthetic detergent
business to Kyowa Hakko Kogyo (now KH Neochem), and thepolyethylene business to Maruzen Petrochemical and the Company has
withdrawn from the petrochemical business in 1988.

Launch of Major Products(Kamayabori Plant)

1989~(1988)
Withdrawal frompetrochemical business

37.2
1980

Significant decrease in sales
after withdrawing frompetrochemicals(Consolidated) (billion yen)
Performance
Chemicals
Materials
169.2
150

28.9

100
50

1990

（FY)

0

Pharmaceuticals

Other
Including fertilizers.
Fertilizers are not consolidated from fiscal 2007
due to spin-off of the fertilizer business.

193.4

200

88.1
9.8

46.2

Agricultural
Chemicals

54.7
35.8

34.1

154.2
34.1
5.1

9.6

7.5

58.1

Transferring inorganic
materials from Chemicals
to Performance Materials

34.4

23.4

38.0

58.8

50.2

38.1

34.9

2005

2010

2017

（FY)

Note
Segments are indicated by the current name.
Other includes trading, others and adjustment.
Nissan Chemical Corporation Integrated Report 201806

Corporate History (Nissan Chemical History)
Nissan chemical was founded in 1887 as Japan’s first chemical fertilizer manufacturer.
We contributed to dramatic increases in domestic food production by the enthusiasms and efforts of our pioneers under the founding spirit “to dedicate ourselvesto prosperity of the nation by agricultural fertility”. The pioneering spirit has been still very much alive at Nissan Chemical where we have been working to expand
our business horizons with innovative technologies and projects that will make the world a better place for all.

1887~

(1887)
Tokyo Jinzo Hiryo

1923~(1910)
Dainippon Jinzo Hiryo(1923)(1937)(1949)(Three companies joint)
Nissan Chemical Industries
Nissan Chemical Industries (Spins off oils and fats section)(Participation to Nissan zaibatsu)(1889) Nippon Seimi Seizo
Tokyo Jinzo Hiryo (The Tokyo Artificial Fertilizer Company) started when
Dr. Jokichi Takamine, who is perhaps best known for his discovery of thedigestive enzyme taka-diastase, witnessed the age’s state-of-the-art
chemical fertilizer production technology while studying in England. Uponhis return to Japan, he enlisted the aid of some of the era’s mostsuccessful business tycoons (such as Eiichi Shibusawa and Takashi
Masuda) to launch a groundbreaking business that would revolutionize
Japanese agriculture.

In the first half of the twentieth century, amid a variety of M&A activities bydomestic corporates, we came to turning points with the three companies
joint in 1923 and with the participation to Nissan zaibatsu in 1937.
The three companies joint was a merger of Kanto Soda, Nippon Kagaku
Hiryo (renamed from Nippon Seimi Seizo) and Dainippon Jinzo Hiryo(surviving company).
The Company had been promoting business diversification and enteredunder the umbrella of Nissan zaibatsu in 1937, which was the 50th
anniversary of its foundation, renamed Nissan Chemical Industries.
Nissan zaibatsu was one of the new financial cliques that took over theKuhara Mining (now JXTG Holdings) and was renamed Nippon Sangyo.
It consisted of Nippon Mining in mining sector, Hitachi in the machinery
sector, and Nissan Motor in the automotive sector and so on.

As the plant site, the land in Ojima 1-chome, Koto-ku, Tokyo, now known
as Kamayabori, had been selected for its convenience in transporting raw
materials and products. In 1888, the production of superphosphate(fertilizer) started.
The main raw materials for superphosphate are phosphoric ore andsulfuric acid, and we had been aiming for the in-house production of
sulfuric acid and the development of its derivatives. Then the products
expanded into the industrial chemicals field, manufacturing sulfuric acidand soda products. The later-merged Nippon Seimi Seizo (now Onoda
Plant) was established in 1889 to produce sulfuric acid and soda.

After World War II, under the separation directive based on the Corporate
Reconstruction and Improvement Law, the fat and oil section was
separated into Nippon Oil and Fats (now NOF) in 1949 and Nissan
Chemical Industries newly started.

Nowadays, we provide products and services globally in the four business domains of Information & Communication, Life Sciences, Environment & Energy, andChemicals & Affiliates, while also refining our core technologies that we have cultivated over the years.
We are striving to create products that meet society’s demands.

1965~(1965)
Entering
petrochemical businessIn the 1950s, as domestic imports of petrochemical products expanded
and the momentum for domestic production increased, we establishedNissan Petrochemicals in 1965 and entered the petrochemical business,starting with the production of higher alcohol.

(Toyama Plant electrolytic facilities)(Package of superphosphate)(Toyama Plant sulfuric
acid warehouse)[In 1928, we began integrated ammonia and ammonium sulfate
manufacture at the Toyama Plant. Ammonia was produced throughelectrolysis process of water and continued until 1967.](Advertising in 1891)

1.2

Fertilizer

Petrochemical

3.2

0

05

24.6
0.3
4.9

21.2
1964

Nissan Chemical Corporation Integrated Report 2018

7.1
8.9

Other

127.6

18.8
50

(1994) LANDEL® (anti-hypertension agent)
PERMIT® (herbicide for corn)(1998) ARC® (bottom anti-reflective coating)(2002) Roundup® (nonselective herbicide)(2003) LIVALO® (anti-cholesterol agent)(2005) AdBlue® (high-grade urea solution)(2008) LEIMAY® (fungicide)(2009) STARMITE® (acaricide for fruit trees and vegetables)(2010) Acquisition of Thifluzamide (fungicide)
ORACLE® (fungicide for soil-borne diseases)(2013) ALTAIR® (herbicide for paddy rice)First shipment of fluralaner (active ingredient for
veterinary pharmaceutical)

Net sales by segment

45.8

100

SNOWTEX® (colloidal silica)
Melamine
HI-LITE® (disinfectant)
TEPIC® (epoxy compound)High-purity Sulfuric Acid
TARGA® (herbicide for grassy weeds)
High-purity Ammonia
High purity Nitric acid
SUNEVER® (LCD alignment coating material)
SIRIUS® (herbicide for paddy rice)(1991) SANMITE® (acaricide for fruit trees and vegetables)

In 2018, the Company has already been transcending the framework ofindustry in the development of its business and will accelerate this effort
toward the future. In order to clarify this stance, we changed our name to
Nissan Chemical Corporation.

Note) ARC® is a registered trademark of Brewer Science, Inc., and AdBlue® is a registered trademark of the Verband der Automobilindustrie.

Net Sales by Segment(Non-consolidated) (billion yen)
Chemicals Agrochemicals

The results of continued R&D investment in this difficult situation emerged.
By the early 1990s, a large number of agrochemicals were on the market,
and in the late 1990s, LCD alignment coating materials grew significantly,
while we entered the semiconductor field. In the 2000s, sales of LIVALO®,
anti-cholesterol agent, increased significantly and we acquired exclusive
marketing rights in Japan to ROUNDUP®, the world’s largest herbicide.
Since then, new agrochemicals have been introduced, and in 2013, theshipment of fluralaner, an active ingredient for veterinary pharmaceutical,
which is one of the main products at present, began.

Despite our long-awaited entry into the petrochemical business, theperiod of contribution to incomes was short, resulting in a large deficit.
However, the development of this business brought the penetration oftechnological ideas to the Company, which led to the development of newtechnologies and businesses such as fine chemicals.

(1951)(1964)(1965)(1978)(1979)(1984)(1985)(1987)(1989)(2018)
Nissan Chemical
Corporation

In 1989, we launched our Five-Year mid-term business plan with the aim of
becoming a value-creating enterprise that was unique and R&D oriented
with two pillars: high-tech fields such as agrochemicals andpharmaceuticals, and traditional technology fields such as functional
products and chemicals.

However, the petrochemical industry experienced a structural slump dueto the impact of the two oil crises of the 1970s. The Company worked torebuild its business, but it was unable to improve its profitability andbegan rationalization. The PVC business was transferred to Toyo Soda
Manufacturing (now Tosoh), the higher alcohol and synthetic detergent
business to Kyowa Hakko Kogyo (now KH Neochem), and thepolyethylene business to Maruzen Petrochemical and the Company has
withdrawn from the petrochemical business in 1988.

Launch of Major Products(Kamayabori Plant)

1989~(1988)
Withdrawal frompetrochemical business

37.2
1980

Significant decrease in sales
after withdrawing frompetrochemicals(Consolidated) (billion yen)
Performance
Chemicals
Materials
169.2
150

28.9

100
50

1990

（FY)

0

Pharmaceuticals

Other
Including fertilizers.
Fertilizers are not consolidated from fiscal 2007
due to spin-off of the fertilizer business.

193.4

200

88.1
9.8

46.2

Agricultural
Chemicals

54.7
35.8

34.1

154.2
34.1
5.1

9.6

7.5

58.1

Transferring inorganic
materials from Chemicals
to Performance Materials

34.4

23.4

38.0

58.8

50.2

38.1

34.9

2005

2010

2017

（FY)

Note
Segments are indicated by the current name.
Other includes trading, others and adjustment.
Nissan Chemical Corporation Integrated Report 201806

Financial Highlights
Operating income / Operating margin

Financial Data (consolidated)(Billion yen)

（%）

40.0
30.0

10.9

10.4

20.0
10.0
0

17.4

2008

12.9

12.8

19.2

2009

19.8

2010

15.5
2011

12.7

19.5

13.6
22.2

14.8
25.3

16.2
28.6

17.4
31.4

18.1

20.0

35.0

15.0
10.0
5.0

2012

2013

2014

2015

2017

2016

Operating income (left axis)

0.0
(FY)

Operating margin (right axis)

Net income attributable to owners of parent / ROE(Billion yen)
30.0
25.0
20.0

12.6

11.9

10.3

9.5

11.4

15.0
10.0
5.0
0

10.1
2008

12.8

2009

13.0

2010

11.0
2011

13.9

12.7

16.7

12.7

18.2

14.6

22.4

16.1

15.1

27.1

24.0

（%）
16.0
12.0
8.0
4.0

2012

2013

2014

2015

2016

2017

Net income attributable to owners of parent (left axis)

0.0
(FY)

ROE (right axis)

Total amount of dividend / Share repurchase / Total payout ratio(Billion yen)

（%）

118

25.0

100

20.0

67
53

15.0
10.0

8.0
3.8

4.1

2.8
4.1

2008

2009

2010

5.0
0

37

32

64

59

5.0

5.0

6.0

4.1

4.3

4.9

5.7

2011

2012

2013

2014

Total amount of dividend (left axis)

71

70

71

9.0

9.0

9.0

6.8
2015

7.9
2016

Share repurchase (left axis)

0
(FY)

（%）

8.6

8.2

9.2

8.9

8.7

8.7

8.9

8.9

8.9

10.0

15.0
10.0

13.7

5.0
0

2008

13.1

2009

12.6

2010

13.6

2011

13.7

2012

14.2

2013

15.0

2014

15.8

2015
R&D expenses (left axis)

07

Nissan Chemical Corporation Integrated Report 2018

FY2015FY2016FY2017

Sales

Billion yen

163.7

171.2

176.9

180.3

193.4

Operating income

Billion yen

22.2

25.3

28.6

31.4

35.0

Ordinary income

Billion yen

23.7

26.4

29.5

31.7

36.2

Net income attributable to owners of parent

Billion yen

16.7

18.2

22.4

24.0

27.1

EBITDA*1

Billion yen

30.8

33.8

38.3

40.3

45.5

EPS*2

Yen / Share102.11113.99143.37156.97180.30

Dividend

Yen / Share

30

36

44

52

68

%

29.4

31.6

30.7

33.1

37.7

Total assets

Billion yen

208.0

223.9

228.2

231.7

249.0

Net assets

Billion yen

137.8

151.3

156.9

163.7

176.4

Cash

Billion yen

30.8

31.3

35.3

35.7

37.7

Liabilities with interest

Billion yen

36.1

35.1

33.1

30.8

28.6

%

65.7

66.9

68.1

69.9

70.1

Capex

Billion yen

8.8

9.8

10.2

14.3

13.7

Depreciation

Billion yen

8.5

8.5

9.7

8.9

10.5

Dividend payout ratio

Equity ratio*1 Operating income + depreciation*2 Net income attributable to owners of parent / issued shares

Sales according to region (billion yen)

Sales according to segment (billion yen)

Operating income according to segment (billion yen)
Others*-0.2

Total payout ratio (right axis)(Billion yen)

8.8

FY2014FY2017 Sales and Operating Income

R&D expenses / Percentage of sales
20.0

FY2013

50

10.2

2017

Unit

16.1

2016

17.2

2017

5.0

0.0
(FY)

R&D expenses / sales (right axis)

Europe,USA, etc.
29.3
Other Asian
countries
39.3
South Korea
20.2

Others*
34.1

Japan
104.5

Chemicals
34.9

Pharmaceuticals
1.2

Chemicals
3.4

Pharmaceuticals
7.5

Agricultural
Chemicals
58.1

Performance
Materials
58.8

Agricultural
Chemicals
16.4

Performance
Materials
14.2* Others: trading, others and adjustment

Nissan Chemical Corporation Integrated Report 201808

Financial Highlights
Operating income / Operating margin

Financial Data (consolidated)(Billion yen)

（%）

40.0
30.0

10.9

10.4

20.0
10.0
0

17.4

2008

12.9

12.8

19.2

2009

19.8

2010

15.5
2011

12.7

19.5

13.6
22.2

14.8
25.3

16.2
28.6

17.4
31.4

18.1

20.0

35.0

15.0
10.0
5.0

2012

2013

2014

2015

2017

2016

Operating income (left axis)

0.0
(FY)

Operating margin (right axis)

Net income attributable to owners of parent / ROE(Billion yen)
30.0
25.0
20.0

12.6

11.9

10.3

9.5

11.4

15.0
10.0
5.0
0

10.1
2008

12.8

2009

13.0

2010

11.0
2011

13.9

12.7

16.7

12.7

18.2

14.6

22.4

16.1

15.1

27.1

24.0

（%）
16.0
12.0
8.0
4.0

2012

2013

2014

2015

2016

2017

Net income attributable to owners of parent (left axis)

0.0
(FY)

ROE (right axis)

Total amount of dividend / Share repurchase / Total payout ratio(Billion yen)

（%）

118

25.0

100

20.0

67
53

15.0
10.0

8.0
3.8

4.1

2.8
4.1

2008

2009

2010

5.0
0

37

32

64

59

5.0

5.0

6.0

4.1

4.3

4.9

5.7

2011

2012

2013

2014

Total amount of dividend (left axis)

71

70

71

9.0

9.0

9.0

6.8
2015

7.9
2016

Share repurchase (left axis)

0
(FY)

（%）

8.6

8.2

9.2

8.9

8.7

8.7

8.9

8.9

8.9

10.0

15.0
10.0

13.7

5.0
0

2008

13.1

2009

12.6

2010

13.6

2011

13.7

2012

14.2

2013

15.0

2014

15.8

2015
R&D expenses (left axis)

07

Nissan Chemical Corporation Integrated Report 2018

FY2015FY2016FY2017

Sales

Billion yen

163.7

171.2

176.9

180.3

193.4

Operating income

Billion yen

22.2

25.3

28.6

31.4

35.0

Ordinary income

Billion yen

23.7

26.4

29.5

31.7

36.2

Net income attributable to owners of parent

Billion yen

16.7

18.2

22.4

24.0

27.1

EBITDA*1

Billion yen

30.8

33.8

38.3

40.3

45.5

EPS*2

Yen / Share102.11113.99143.37156.97180.30

Dividend

Yen / Share

30

36

44

52

68

%

29.4

31.6

30.7

33.1

37.7

Total assets

Billion yen

208.0

223.9

228.2

231.7

249.0

Net assets

Billion yen

137.8

151.3

156.9

163.7

176.4

Cash

Billion yen

30.8

31.3

35.3

35.7

37.7

Liabilities with interest

Billion yen

36.1

35.1

33.1

30.8

28.6

%

65.7

66.9

68.1

69.9

70.1

Capex

Billion yen

8.8

9.8

10.2

14.3

13.7

Depreciation

Billion yen

8.5

8.5

9.7

8.9

10.5

Dividend payout ratio

Equity ratio*1 Operating income + depreciation*2 Net income attributable to owners of parent / issued shares

Sales according to region (billion yen)

Sales according to segment (billion yen)

Operating income according to segment (billion yen)
Others*-0.2

Total payout ratio (right axis)(Billion yen)

8.8

FY2014FY2017 Sales and Operating Income

R&D expenses / Percentage of sales
20.0

FY2013

50

10.2

2017

Unit

16.1

2016

17.2

2017

5.0

0.0
(FY)

R&D expenses / sales (right axis)

Europe,USA, etc.
29.3
Other Asian
countries
39.3
South Korea
20.2

Others*
34.1

Japan
104.5

Chemicals
34.9

Pharmaceuticals
1.2

Chemicals
3.4

Pharmaceuticals
7.5

Agricultural
Chemicals
58.1

Performance
Materials
58.8

Agricultural
Chemicals
16.4

Performance
Materials
14.2* Others: trading, others and adjustment

Nissan Chemical Corporation Integrated Report 201808

Non-Financial Highlights
Employees working in global field (as of March 31, 2018)

Non-Financial Data (non-consolidated)
NCK Co., Ltd.（2001〜）
Employees based overseas: 12（Local Employees: 120）

Nissan Chemical Europe S.A.S.（2002〜）
Employees based overseas: 3（Local Employees: 5）Unit

FY2013

FY2014FY2015FY2016FY2017

Male

People

1,543

1,553

1,567

1,598

1,628

FemalePeople

164

168

172

174

191

％

9.6

9.8

9.9

9.8

10.5

Male

People

34

39

59

51

58

FemalePeople

7

10

6

13

20

％

17.1

20.4

9.2

20.3

25.6

Male

People

26

18

20

19

25

FemalePeople

81

91

96

100

103

Male

People

449

461

465

468

469

FemalePeople

9

10

12

11

11

Percentage of females among managers

％

2.0

2.1

2.5

2.3

2.3

Re-employment of retired employees

People

66

60

64

85

91

Percentage of re-employment of retired employees

％

63

66

97

89

75

Percentage of employees with disabilities*1

％

2.22

2.35

2.15

2.23

2.21

Employees who started maternity leave

People

8

9

7

13

6

Male

People

0

1

2

0

0

FemalePeople

6

6

8

11

8

Male

％

ー

ー

100

100

ー

Female

％

80

100

100

100

100

Male

％

ー

ー

100

100

ー

Female

％

100

100

85.7

100

100

Male

People

0

0

0

1

0

FemalePeople

7

9

11

10

10

Average overtime per month

Hrs

18.0

18.8

19.0

20.0

19.3

Percentage of taking annual leave

％

76.9

73.4

77.4

77.2

77.6

People

1

1

3

2

2

Percentage of employees leaving job within 3 years of employment

％

3.1

3.8

12.0

4.9

4.1

Average of length of employees’ service

Overall

Year

16.6

16.9

16.8

16.2

15.9

Male

Year

16.6

17.0

16.9

16.3

16.1

Female

Year

16.4

16.6

15.8

15.6

14.5

Amount of energy consumed (crude oil equivalent)*2

1,000kL

95

92

99

99

98

Waste generation

1,000tons

26.3

33.0

33.4

33.7

34.7

Final disposal volume of waste

1,000tons

1.5

2.3

2.2

1.1

0.8

Full-time employees

Percentage of females among full-time employees
New employees (graduates)

Nissan Chemical Agro Korea Ltd.（2005〜）（Local Employees: 5）

Percentage of females among new employees
Temporary employees
Nissan Agro Tech India PVT. LTD.（2017〜）
Employees based overseas: 2（Local Employees: 4）

Nissan Chemical Taiwan Co., Ltd.
（2010〜）
Employees based overseas: 8（Local Employees: 17）

Nissan Chemical Product (Shanghai) Co., Ltd.（2014〜）
Employees based overseas: 7（Local Employees: 17）

Managers

Nissan Chemical America
Corporation（1989〜）
Employees based overseas: 4（Local Employees: 30）

Nissan Chemical Do Brasil（2016〜）（Local Employees: 3）

Employees who started childcare leave

Greenhouse gas emissions

Percentage returning to work after taking maternity / childcare leave (“–”: Not applicable)(1,000 tons)
500

455

467

447

448

437

458

462

462

400

234

247

231

220

248

250

237

255

49

55

140

153

172

152

31
155

2012

2013

2014

2015

2016

432
246

300
200

61

60

59

53

100

160

160

157

175

2008

2009

2010

2011

0

CO2 emissions from energy use

Water resources input* / Effluent

53

55

CO2 emissions from non-energy use

Retention rate after taking maternity / childcare leave (“–”: Not applicable)

379
232

Employees who started shorter working hours for childcare
23
124
2017

(FY)

Dinitrogen monoxide (CO2 equivalent)

Leaving job within 3 years of employment*Tap water, groundwater and industrial water used for business activities(Million m3)
40
30
20
10
0

41.6

40.9

40.4
16.7
2008

15.9
2009

41.3

40.3
15.9

2010

15.5
2011

15.3
2012

42.8

41.1

41.1
15.1
2013

14.9
2014

42.1

42.2
15.1

2015

15.0
2016

14.4
2017

Water resources input

09

Nissan Chemical Corporation Integrated Report 2018

(FY)
Effluent*1 Statutory rate: 2.0％

*2 Energy: Fuel, purchased electricity and purchased steam used for business activities

Nissan Chemical Corporation Integrated Report 201810

Non-Financial Highlights
Employees working in global field (as of March 31, 2018)

Non-Financial Data (non-consolidated)
NCK Co., Ltd.（2001〜）
Employees based overseas: 12（Local Employees: 120）

Nissan Chemical Europe S.A.S.（2002〜）
Employees based overseas: 3（Local Employees: 5）Unit

FY2013

FY2014FY2015FY2016FY2017

Male

People

1,543

1,553

1,567

1,598

1,628

FemalePeople

164

168

172

174

191

％

9.6

9.8

9.9

9.8

10.5

Male

People

34

39

59

51

58

FemalePeople

7

10

6

13

20

％

17.1

20.4

9.2

20.3

25.6

Male

People

26

18

20

19

25

FemalePeople

81

91

96

100

103

Male

People

449

461

465

468

469

FemalePeople

9

10

12

11

11

Percentage of females among managers

％

2.0

2.1

2.5

2.3

2.3

Re-employment of retired employees

People

66

60

64

85

91

Percentage of re-employment of retired employees

％

63

66

97

89

75

Percentage of employees with disabilities*1

％

2.22

2.35

2.15

2.23

2.21

Employees who started maternity leave

People

8

9

7

13

6

Male

People

0

1

2

0

0

FemalePeople

6

6

8

11

8

Male

％

ー

ー

100

100

ー

Female

％

80

100

100

100

100

Male

％

ー

ー

100

100

ー

Female

％

100

100

85.7

100

100

Male

People

0

0

0

1

0

FemalePeople

7

9

11

10

10

Average overtime per month

Hrs

18.0

18.8

19.0

20.0

19.3

Percentage of taking annual leave

％

76.9

73.4

77.4

77.2

77.6

People

1

1

3

2

2

Percentage of employees leaving job within 3 years of employment

％

3.1

3.8

12.0

4.9

4.1

Average of length of employees’ service

Overall

Year

16.6

16.9

16.8

16.2

15.9

Male

Year

16.6

17.0

16.9

16.3

16.1

Female

Year

16.4

16.6

15.8

15.6

14.5

Amount of energy consumed (crude oil equivalent)*2

1,000kL

95

92

99

99

98

Waste generation

1,000tons

26.3

33.0

33.4

33.7

34.7

Final disposal volume of waste

1,000tons

1.5

2.3

2.2

1.1

0.8

Full-time employees

Percentage of females among full-time employees
New employees (graduates)

Nissan Chemical Agro Korea Ltd.（2005〜）（Local Employees: 5）

Percentage of females among new employees
Temporary employees
Nissan Agro Tech India PVT. LTD.（2017〜）
Employees based overseas: 2（Local Employees: 4）

Nissan Chemical Taiwan Co., Ltd.
（2010〜）
Employees based overseas: 8（Local Employees: 17）

Nissan Chemical Product (Shanghai) Co., Ltd.（2014〜）
Employees based overseas: 7（Local Employees: 17）

Managers

Nissan Chemical America
Corporation（1989〜）
Employees based overseas: 4（Local Employees: 30）

Nissan Chemical Do Brasil（2016〜）（Local Employees: 3）

Employees who started childcare leave

Greenhouse gas emissions

Percentage returning to work after taking maternity / childcare leave (“–”: Not applicable)(1,000 tons)
500

455

467

447

448

437

458

462

462

400

234

247

231

220

248

250

237

255

49

55

140

153

172

152

31
155

2012

2013

2014

2015

2016

432
246

300
200

61

60

59

53

100

160

160

157

175

2008

2009

2010

2011

0

CO2 emissions from energy use

Water resources input* / Effluent

53

55

CO2 emissions from non-energy use

Retention rate after taking maternity / childcare leave (“–”: Not applicable)

379
232

Employees who started shorter working hours for childcare
23
124
2017

(FY)

Dinitrogen monoxide (CO2 equivalent)

Leaving job within 3 years of employment*Tap water, groundwater and industrial water used for business activities(Million m3)
40
30
20
10
0

41.6

40.9

40.4
16.7
2008

15.9
2009

41.3

40.3
15.9

2010

15.5
2011

15.3
2012

42.8

41.1

41.1
15.1
2013

14.9
2014

42.1

42.2
15.1

2015

15.0
2016

14.4
2017

Water resources input

09

Nissan Chemical Corporation Integrated Report 2018

(FY)
Effluent*1 Statutory rate: 2.0％

*2 Energy: Fuel, purchased electricity and purchased steam used for business activities

Nissan Chemical Corporation Integrated Report 201810

Message from the President
The Results for FY2017 and Forecast for FY2018
In FY2017, the domestic economy continued to recover moderately as
corporate earnings improvement, capital investment and consumer
spending picked up amid the sustained strength of the global economy.
In Nissan Chemical, the Chemicals Division performed well and thesales of display materials from Performance Materials Division and
Fluralaner (active ingredient for veterinary pharmaceuticals) from
Agricultural Chemicals Division grew particularly. In the Pharmaceuticals
Division, domestic sales of LIVALO® (anti-cholesterol agent) declined due
to an increase in generics. However, in the fiscal year under review, net
sales was 193.4 billion yen and operating income was 35.0 billion yen, bothof which recorded highs. In terms of financial indicators, we improved upon
the previous year’s figures with an operating margin of 18.1% and return on
equity (ROE) of 15.1%. R&D expenses as a percentage of sales accounted
for 8.9% of the previous year’s level.
In FY2018, we forecast sales of 204.0 billion yen and operating incomeof 36.8 billion yen, up 10.6 billion yen and 1.8 billion yen, respectively,
compared to FY2017, due to the strong performance of all divisions and thesustained strength of the active ingredient for veterinary pharmaceuticals,
although there are also factors such as rising fuel and feedstock prices andincreased fixed costs associated with capital investment.

Business Plan
In 2016, we launched “Progress2030”, a long-term business plan that looks
ahead to 2030, and “Vista2021”, a six-year mid-term business plan thatoutlines the ideal state for 2021.
In “Progress2030”, we envisioned the corporate vision in 2030 as “Acorporate group which provides new values for helping to enrich people’s
lives by integrating internal and external knowledge with facing
globally-changing society”, and “A group of first-class pioneers who blaze a
way to the future with enthusiasm by trusts they have built and skills they
have cultivated”.
In FY2030, we set numerical targets of 300 billion yen in sales and 50
billion yen in operating income. Based on the five core technologies wehave cultivated, “Fine Organic Synthesis”, “Functional Polymer Design”,“Ultrafine Particle Control”, “Biological Evaluation”, and “Optical Control”,
we will contribute to the resolve of global issues in the fields of “Information& Communication”, “Life Sciences”, “Environment & Energy”, and,“Chemicals & Affiliates” and will strive to improve company value along withthe development of society.
In “Vista2021”, we aim “Information & Communication and Life Sciences
are the driving force for growth while Chemicals & Affiliates achieve astable profit.” and “Establish the foundation of Environment & Energy
business and a position as a promising chemical manufacturer that keeps
moving forward with a strong presence.”
President & CEO

Kojiro Kinoshita
11

Nissan Chemical Corporation Integrated Report 2018

Progress of “Vista2021 Stage I”
The first three years of the “Vista2021 Stage I” are based on three basic
strategies: “Maximizing the profit from existing products”, “Improving
marketing power”, and “Enhancing R&D capability”.
With regard to “Maximizing the profit from existing products”, we areaccelerating the development of cutting-advanced materials that meet thetechnological innovations in semiconductors, expanding sales of
nanoActiv® HRT, shale oil and gas extraction efficiencies, to other regions
and its production facilities, and providing a stable supply of APIs in
response to increased demand for Fluralaner.
Regarding “Improving marketing power”, in April 2016, we dispatched a
representative to Santa Clara, which is located in Silicon Valley, the UnitedStates, to collect and evaluate information on our cutting-edge
technologies, in order to create new businesses in the future. We alsoestablished subsidiaries in Brazil in 2016 and India in 2017 to expand ourbusiness in the growing overseas agrochemical market. In July 2018,
subsidiary in Suzhou, China, which was established to provide technicalsupport to the Chinese display materials market and strengthen customer
services, started operations. Through these measures, we will realize thedevelopment of products that meet market needs in early stage.
As results of “Enhancing R&D capability”, we have developed a new
insecticide, GRACIA® and are scheduled to be launched in South Korea in2018 and in Japan in 2019. In addition, we aim to expand into new
business fields through the introduction of new materials and technologies,
and we will reinforce the collaboration with external organizations, such as
2016

through organizational collaboration with Kyushu University. Besides, we
are working to early stage establish a synthetic method to reduce the
manufacturing cost of active ingredients for medical drugs such as peptides
and nucleic acids.
Our numerical targets for FY2018 are net sales of 217.0 billion yen,operating income of 35.0 billion yen, operating margin of 15% or more, andROE of 14% or more. Although net sales will be lower owing to downturn ataffiliate, we expect to achieve the targets in both operating income,
operating margin and ROE.

Shareholder Return
In our mid-term business plan, we announced our policy of graduallyraising the dividend payout ratio to 40% in FY2018 and achieving a total
payout ratio of 70%. In accordance with this policy, we raised the dividend
payout ratio from FY2016 onward and plan to raise to 40.6% in FY2018.
We have also continued to flexible share repurchase and maintain a total
payout ratio of 70%.

2018

Liquid crystal materials forphoto-alignment IPS
Semiconductor materials
Active ingredients forveterinary pharmaceuticals

300

2021

2030

Oilfield materials

Optical materials

OLED materials

Biomedical materials

New insecticides

Battery materials

300.0
60.0

250.0
250
200

163.7

171.2

176.9

150
100

22.2

25.3

28.6

180.3

31.4

193.4
35.0

50.0

204.0

36.8

40.0

40.0
30.0
20.0

50
0

50.0

10.0

2013

2014

2015

2016

2017

2018 (Forecast)

2021

Operating income (billion yen, right axis)

02030 (FY)
Sales (billion yen, left axis)

Nissan Chemical Corporation Integrated Report 201812

Message from the President
The Results for FY2017 and Forecast for FY2018
In FY2017, the domestic economy continued to recover moderately as
corporate earnings improvement, capital investment and consumer
spending picked up amid the sustained strength of the global economy.
In Nissan Chemical, the Chemicals Division performed well and thesales of display materials from Performance Materials Division and
Fluralaner (active ingredient for veterinary pharmaceuticals) from
Agricultural Chemicals Division grew particularly. In the Pharmaceuticals
Division, domestic sales of LIVALO® (anti-cholesterol agent) declined due
to an increase in generics. However, in the fiscal year under review, net
sales was 193.4 billion yen and operating income was 35.0 billion yen, bothof which recorded highs. In terms of financial indicators, we improved upon
the previous year’s figures with an operating margin of 18.1% and return on
equity (ROE) of 15.1%. R&D expenses as a percentage of sales accounted
for 8.9% of the previous year’s level.
In FY2018, we forecast sales of 204.0 billion yen and operating incomeof 36.8 billion yen, up 10.6 billion yen and 1.8 billion yen, respectively,
compared to FY2017, due to the strong performance of all divisions and thesustained strength of the active ingredient for veterinary pharmaceuticals,
although there are also factors such as rising fuel and feedstock prices andincreased fixed costs associated with capital investment.

Business Plan
In 2016, we launched “Progress2030”, a long-term business plan that looks
ahead to 2030, and “Vista2021”, a six-year mid-term business plan thatoutlines the ideal state for 2021.
In “Progress2030”, we envisioned the corporate vision in 2030 as “Acorporate group which provides new values for helping to enrich people’s
lives by integrating internal and external knowledge with facing
globally-changing society”, and “A group of first-class pioneers who blaze a
way to the future with enthusiasm by trusts they have built and skills they
have cultivated”.
In FY2030, we set numerical targets of 300 billion yen in sales and 50
billion yen in operating income. Based on the five core technologies wehave cultivated, “Fine Organic Synthesis”, “Functional Polymer Design”,“Ultrafine Particle Control”, “Biological Evaluation”, and “Optical Control”,
we will contribute to the resolve of global issues in the fields of “Information& Communication”, “Life Sciences”, “Environment & Energy”, and,“Chemicals & Affiliates” and will strive to improve company value along withthe development of society.
In “Vista2021”, we aim “Information & Communication and Life Sciences
are the driving force for growth while Chemicals & Affiliates achieve astable profit.” and “Establish the foundation of Environment & Energy
business and a position as a promising chemical manufacturer that keeps
moving forward with a strong presence.”
President & CEO

Kojiro Kinoshita
11

Nissan Chemical Corporation Integrated Report 2018

Progress of “Vista2021 Stage I”
The first three years of the “Vista2021 Stage I” are based on three basic
strategies: “Maximizing the profit from existing products”, “Improving
marketing power”, and “Enhancing R&D capability”.
With regard to “Maximizing the profit from existing products”, we areaccelerating the development of cutting-advanced materials that meet thetechnological innovations in semiconductors, expanding sales of
nanoActiv® HRT, shale oil and gas extraction efficiencies, to other regions
and its production facilities, and providing a stable supply of APIs in
response to increased demand for Fluralaner.
Regarding “Improving marketing power”, in April 2016, we dispatched a
representative to Santa Clara, which is located in Silicon Valley, the UnitedStates, to collect and evaluate information on our cutting-edge
technologies, in order to create new businesses in the future. We alsoestablished subsidiaries in Brazil in 2016 and India in 2017 to expand ourbusiness in the growing overseas agrochemical market. In July 2018,
subsidiary in Suzhou, China, which was established to provide technicalsupport to the Chinese display materials market and strengthen customer
services, started operations. Through these measures, we will realize thedevelopment of products that meet market needs in early stage.
As results of “Enhancing R&D capability”, we have developed a new
insecticide, GRACIA® and are scheduled to be launched in South Korea in2018 and in Japan in 2019. In addition, we aim to expand into new
business fields through the introduction of new materials and technologies,
and we will reinforce the collaboration with external organizations, such as
2016

through organizational collaboration with Kyushu University. Besides, we
are working to early stage establish a synthetic method to reduce the
manufacturing cost of active ingredients for medical drugs such as peptides
and nucleic acids.
Our numerical targets for FY2018 are net sales of 217.0 billion yen,operating income of 35.0 billion yen, operating margin of 15% or more, andROE of 14% or more. Although net sales will be lower owing to downturn ataffiliate, we expect to achieve the targets in both operating income,
operating margin and ROE.

Shareholder Return
In our mid-term business plan, we announced our policy of graduallyraising the dividend payout ratio to 40% in FY2018 and achieving a total
payout ratio of 70%. In accordance with this policy, we raised the dividend
payout ratio from FY2016 onward and plan to raise to 40.6% in FY2018.
We have also continued to flexible share repurchase and maintain a total
payout ratio of 70%.

2018

Liquid crystal materials forphoto-alignment IPS
Semiconductor materials
Active ingredients forveterinary pharmaceuticals

300

2021

2030

Oilfield materials

Optical materials

OLED materials

Biomedical materials

New insecticides

Battery materials

300.0
60.0

250.0
250
200

163.7

171.2

176.9

150
100

22.2

25.3

28.6

180.3

31.4

193.4
35.0

50.0

204.0

36.8

40.0

40.0
30.0
20.0

50
0

50.0

10.0

2013

2014

2015

2016

2017

2018 (Forecast)

2021

Operating income (billion yen, right axis)

02030 (FY)
Sales (billion yen, left axis)

Nissan Chemical Corporation Integrated Report 201812

Message from the President
For Sustainable GrowthThis report describes the process of value creation as an indication of how
our group will improve our company value in the future. Recognizing andresponding to various social changes and issues, we identified and will
strengthen our initiatives on materiality that are indispensable for realizing
our corporate vision in 2030.
With regard to materiality, we identified 19 key issues that are divided
into three parts, such as “provision of new value for helping to enrichpeople’s lives”, “strengthening of our business base”, and “continuous
improvement of responsible care activities” with underlying the crucial
issues for corporate survival that are “strengthening of corporate
governance, risk management and compliance”. The materiality weidentified takes into account ESG (Environment, Social, Governance) index
and several guidelines including SDGs (Sustainable Development Goals),and dialogues with stakeholders.
We will resolve these issues by leveraging our strengths that are “humanresources”, “R&D capability”, and “financial base”.

Approach to Crucial Issues
In regard to corporate governance, we have introduced an executive officer
system since 2014 and reduced the number of directors to acceleratemanagement decision-making and clarify management responsibility andoperational responsibility. Also, we strive to ensure the soundness andtransparency of our management by improving management monitoring
functions through the appointment of outside directors, strengthening
compliance system, risk management system and internal control system
in addition to conducting effectiveness evaluation using externalorganizations every few years that do not have any interest in ourcompany.
In April 2018, we established the Risk Management & Compliance
Committee, chaired by the Chief Risk Management Officer tocomprehensively manage the risks of our group, improve the effectivenessof risk management, and maintain and improve compliance. At the sametime, the Risk Management & Compliance Office was established under
the Corporate Planning Department as a specialized organization topromote continuous improvement in all of these activities. We haveestablished the Risk Management Basic Policy and the Compliance Basic
Policy. The Committee and the Risk Management & Compliance Office areresponsible for identifying group major risks, auditing compliance status,and providing compliance training and guidance. Moreover, we haveestablished the Consultation Hotline to prevent or resolve complianceviolations as early stage. In addition to paying attention to ensure
whistleblowers do not suffer from any disadvantage, the contact points forreporting are set up as outside attorneys, outside corporate auditors, inaddition to the department in charge of internal reporting.

13

Nissan Chemical Corporation Integrated Report 2018

Business Activities and CSR
Our group considers that the corporate philosophy “We contribute tosociety in harmony with the environment, based on our excellent
technologies, products and services.” is the basis of our business activities
and putting the philosophy into practice is CSR activities.
Since 1992, our group has been promoting responsible care activities toensure the environment, health, and safety of our products throughout their
entire life cycle as a manufacturing company that handles chemical
substances. In particular, climate change countermeasures are one of themost important issues that must be addressed around the world, such as
the effect into force of the Paris Agreement. We have switched from heavy
oil and naphtha, which are fuel and feedstock for ammonia and melamine,
to natural gas, and reduced nitrous oxide (N2O), which is a by-product ofnitric acid manufacture. As a result, we achieved our target for
improvement of greenhouse gas emission rate in FY2017 under the
responsible care mid-term plan by FY2021, and we revised the target
upward in FY2018.
Zero accident and accident-free initiatives are our responsibility as acompany and are the foundation of our business activities. Although
accidents that require staff time off from work are still occurring, we aim toeliminate occupational accidents by investigating the causes of accidents,
taking countermeasures, and sharing information with the entire group.
In order to achieve corporate sustainable growth, it is essential for each
employee to play an active role and to revitalize the organization. We arepromoting an fair personnel evaluation system, respecting diverse humanresources, personalities, and mind set, and introducing various humanresource development systems. In addition, based on the belief that thehealth of employees is a “foundation that supports sound corporate
growth”, we have established a Basic Health Policy and systems sothat employees can balance their work and life. As a result of these
initiatives, we were recognized under the “2018 Certified Health andProductivity Management Organization Recognition Program (White 500)”,
following from 2017.
We recognize that CSR elements such as attention to environment, labor
practice, human rights and ethic become more important, as well as quality
control, performance, cost and trading condition in value chain. We will
send out “CSR Procurement Questionnaire” to our business partners andsummarize their results. Based on these results, we will work with ourbusiness partners to promote CSR procurement, which enhances societysustainability, by developing activities that contribute to social andenvironmental impact and risk reduction in supply chain.

Participation in United Nations Global Compact
In April 2018, we joined United Nations Global Compact (UNGC) toenhance our CSR activities. UNGC is a voluntary initiative in which
corporates and collectives act as good members of the society andparticipate in the creation of a global framework for achieving sustainablegrowth by demonstrating responsibility and creative leadership. We support
10 principles advocated by United Nations in four fields in human rights,
labor, the environment and anti-corruption, and will continue to make efforts
to realize them, thereby contributing to the sustainable development ofsociety.

Closing

HumanrightsPrinciple 1: Businesses should support and respect theprotection of internationally proclaimed human rights
Principle 2: Make sure that they are not complicit in humanrights abuses
Principle 3: Businesses should uphold the freedom of association andthe effective recognition of the right to collective bargaining

LabourPrinciple 4: The elimination of all forms of forced andcompulsory labour
Principle 5: The effective abolition of child labour
Principle 6: The elimination of discrimination in respect of
employment and occupation
Principle 7: Businesses should support a precautionary
approach to environmental challenges

Environment

We changed our corporate name from “Nissan Chemical Industries, Ltd.” to“Nissan Chemical Corporation” on July 1, 2018. Founded in 1887 asJapan’s first chemical fertilizer manufacturer, Tokyo Jinzo Hiryo, theCompany has continued numerous mergers and acquisitions. The
Company has continued to take on new challenges by continuing to pursue
innovative technologies that promote social progress through theenthusiasms and efforts of its pioneers, whose founding spirit is “todedicate ourselves to prosperity of the nation by agricultural fertility”.
We have already been transcending the framework of industry in thedevelopment of our business and will accelerate this effort toward thefuture. It made us change the corporate name to adapt to its business
content.
In FY2018, we will start formulating a Stage II for the latter three years of
the “Vista2021”. While the group’s current performance is strong, we
recognize that the products that drive business performance are biased,
and that the creation of new products is lagging behind. By accelerating ourefforts for materiality, we intend to formulate plans to achieve sustainablesocial and corporate growth as a future-creating enterprise that responds tosocial needs with unique, innovative technologies.
I hope we can rely on the understanding and support of all of our
stakeholders in the future.

Principle 8: Undertake initiatives to promote greater
environmental responsibility
Principle 9: Encourage the development and diffusion ofenvironmentally friendly technologies

AntiCorruption

Principle 10: Businesses should work against corruption in
all its forms, including extortion and bribery

Nissan Chemical Corporation Integrated Report 201814

Message from the President
For Sustainable GrowthThis report describes the process of value creation as an indication of how
our group will improve our company value in the future. Recognizing andresponding to various social changes and issues, we identified and will
strengthen our initiatives on materiality that are indispensable for realizing
our corporate vision in 2030.
With regard to materiality, we identified 19 key issues that are divided
into three parts, such as “provision of new value for helping to enrichpeople’s lives”, “strengthening of our business base”, and “continuous
improvement of responsible care activities” with underlying the crucial
issues for corporate survival that are “strengthening of corporate
governance, risk management and compliance”. The materiality weidentified takes into account ESG (Environment, Social, Governance) index
and several guidelines including SDGs (Sustainable Development Goals),and dialogues with stakeholders.
We will resolve these issues by leveraging our strengths that are “humanresources”, “R&D capability”, and “financial base”.

Approach to Crucial Issues
In regard to corporate governance, we have introduced an executive officer
system since 2014 and reduced the number of directors to acceleratemanagement decision-making and clarify management responsibility andoperational responsibility. Also, we strive to ensure the soundness andtransparency of our management by improving management monitoring
functions through the appointment of outside directors, strengthening
compliance system, risk management system and internal control system
in addition to conducting effectiveness evaluation using externalorganizations every few years that do not have any interest in ourcompany.
In April 2018, we established the Risk Management & Compliance
Committee, chaired by the Chief Risk Management Officer tocomprehensively manage the risks of our group, improve the effectivenessof risk management, and maintain and improve compliance. At the sametime, the Risk Management & Compliance Office was established under
the Corporate Planning Department as a specialized organization topromote continuous improvement in all of these activities. We haveestablished the Risk Management Basic Policy and the Compliance Basic
Policy. The Committee and the Risk Management & Compliance Office areresponsible for identifying group major risks, auditing compliance status,and providing compliance training and guidance. Moreover, we haveestablished the Consultation Hotline to prevent or resolve complianceviolations as early stage. In addition to paying attention to ensure
whistleblowers do not suffer from any disadvantage, the contact points forreporting are set up as outside attorneys, outside corporate auditors, inaddition to the department in charge of internal reporting.

13

Nissan Chemical Corporation Integrated Report 2018

Business Activities and CSR
Our group considers that the corporate philosophy “We contribute tosociety in harmony with the environment, based on our excellent
technologies, products and services.” is the basis of our business activities
and putting the philosophy into practice is CSR activities.
Since 1992, our group has been promoting responsible care activities toensure the environment, health, and safety of our products throughout their
entire life cycle as a manufacturing company that handles chemical
substances. In particular, climate change countermeasures are one of themost important issues that must be addressed around the world, such as
the effect into force of the Paris Agreement. We have switched from heavy
oil and naphtha, which are fuel and feedstock for ammonia and melamine,
to natural gas, and reduced nitrous oxide (N2O), which is a by-product ofnitric acid manufacture. As a result, we achieved our target for
improvement of greenhouse gas emission rate in FY2017 under the
responsible care mid-term plan by FY2021, and we revised the target
upward in FY2018.
Zero accident and accident-free initiatives are our responsibility as acompany and are the foundation of our business activities. Although
accidents that require staff time off from work are still occurring, we aim toeliminate occupational accidents by investigating the causes of accidents,
taking countermeasures, and sharing information with the entire group.
In order to achieve corporate sustainable growth, it is essential for each
employee to play an active role and to revitalize the organization. We arepromoting an fair personnel evaluation system, respecting diverse humanresources, personalities, and mind set, and introducing various humanresource development systems. In addition, based on the belief that thehealth of employees is a “foundation that supports sound corporate
growth”, we have established a Basic Health Policy and systems sothat employees can balance their work and life. As a result of these
initiatives, we were recognized under the “2018 Certified Health andProductivity Management Organization Recognition Program (White 500)”,
following from 2017.
We recognize that CSR elements such as attention to environment, labor
practice, human rights and ethic become more important, as well as quality
control, performance, cost and trading condition in value chain. We will
send out “CSR Procurement Questionnaire” to our business partners andsummarize their results. Based on these results, we will work with ourbusiness partners to promote CSR procurement, which enhances societysustainability, by developing activities that contribute to social andenvironmental impact and risk reduction in supply chain.

Participation in United Nations Global Compact
In April 2018, we joined United Nations Global Compact (UNGC) toenhance our CSR activities. UNGC is a voluntary initiative in which
corporates and collectives act as good members of the society andparticipate in the creation of a global framework for achieving sustainablegrowth by demonstrating responsibility and creative leadership. We support
10 principles advocated by United Nations in four fields in human rights,
labor, the environment and anti-corruption, and will continue to make efforts
to realize them, thereby contributing to the sustainable development ofsociety.

Closing

HumanrightsPrinciple 1: Businesses should support and respect theprotection of internationally proclaimed human rights
Principle 2: Make sure that they are not complicit in humanrights abuses
Principle 3: Businesses should uphold the freedom of association andthe effective recognition of the right to collective bargaining

LabourPrinciple 4: The elimination of all forms of forced andcompulsory labour
Principle 5: The effective abolition of child labour
Principle 6: The elimination of discrimination in respect of
employment and occupation
Principle 7: Businesses should support a precautionary
approach to environmental challenges

Environment

We changed our corporate name from “Nissan Chemical Industries, Ltd.” to“Nissan Chemical Corporation” on July 1, 2018. Founded in 1887 asJapan’s first chemical fertilizer manufacturer, Tokyo Jinzo Hiryo, theCompany has continued numerous mergers and acquisitions. The
Company has continued to take on new challenges by continuing to pursue
innovative technologies that promote social progress through theenthusiasms and efforts of its pioneers, whose founding spirit is “todedicate ourselves to prosperity of the nation by agricultural fertility”.
We have already been transcending the framework of industry in thedevelopment of our business and will accelerate this effort toward thefuture. It made us change the corporate name to adapt to its business
content.
In FY2018, we will start formulating a Stage II for the latter three years of
the “Vista2021”. While the group’s current performance is strong, we
recognize that the products that drive business performance are biased,
and that the creation of new products is lagging behind. By accelerating ourefforts for materiality, we intend to formulate plans to achieve sustainablesocial and corporate growth as a future-creating enterprise that responds tosocial needs with unique, innovative technologies.
I hope we can rely on the understanding and support of all of our
stakeholders in the future.

Principle 8: Undertake initiatives to promote greater
environmental responsibility
Principle 9: Encourage the development and diffusion ofenvironmentally friendly technologies

AntiCorruption

Principle 10: Businesses should work against corruption in
all its forms, including extortion and bribery

Nissan Chemical Corporation Integrated Report 201814

“Progress2030” Long-Term Business Plan and “Vista2021” Mid-Term Business Plan

1. Outline of “Progress2030” Long-Term Business Plan

2. Outline of “Vista2021” Mid-Term Business Plan
―A Six-Year Plan starting in FY2016―

1 Corporate Vision in 2030
“A corporate group which provides new values for helping to enrich people’s lives by integrating internal and external knowledge withfacing globally-changing society”“ A group of first-class pioneers who blaze a way to the future with enthusiasm by trusts they have built and skills they have cultivated”

The plan is divided into the first three years (FY2016 to 2018) as Stage I and the second three years (FY2019 to 2021) as Stage II.

1 Ideal Situation of 2021
“Information & Communication and Life Sciences are the driving force for growth while Chemicals & Affiliates achieve a stable profit.”“Establish the foundation of Environment & Energy business and a position as a promising chemical manufacturer that keeps moving forward with a strong presence.”

2 Basic Strategies“Entering new fields by evolving, deepening and expanding unique technologies”

2 Financial target

1) Information & Communication (display, semiconductor, inorganic, optical and sensor materials)
For display, semiconductor and inorganic materials, we will provide products based on technological innovations in the market.

2. Operating income by Segment (billion yen)

1.Sales / Operating income / Net income*1 (billion yen)
Net sales (left axis)

We will also create sensor materials by using our existing technologies and optical materials by establishing optical control technologies.
2) Life Sciences (agrochemicals, veterinary pharmaceuticals, pharmaceuticals and biomedical materials)
We will strengthen the pipeline for agrochemicals and pharmaceuticals, also develop new veterinary pharmaceuticals.

Operating income (right axis)

250.0

250

In addition, we will create biomedical materials that contribute to advanced medical care using accumulated technologies for biological evaluation and material design.
3) Environment & Energy (batteries, energy harvesting and thermal control materials)
We will establish a device evaluation technology then supply battery materials and materials that contribute to efficient use of energy.
4) Chemicals & Affiliates (basic chemicals, fine chemicals and affiliates)
We will continue to carry out R&D in relation to TEPIC®-epoxy compound for LED sealants, solder resist, painting-and launch new high-performance compounds.

200
150

217.0

176.9

50.0

40.0

35.0

28.6

Chemicals

Net income (right axis)

40.0

31.0

27.1

35
25

100

20.0

15

50

10.0

0

0

2.0

2018

2021

(FY)

Pharmaceuticals

2.0

28.6

2.4

35.0 0.7

12.0

15.4

3.9
▲0.1

4.0

2015

2018

Others*2

40.0

16.7

12.9

10.8

0
2015

Agricultural Chemicals

45

30.0

22.4

Performance Materials

18.4

▲2.0

4.5
2021

(FY)

*1 Net income attributable to owners of parent*2 Others: trading, others and adjustment
Naphtha (¥/kL):FY2015 42,800 FY2016 35,400 FY2017 and onward 51,100 FX rate (¥/$): FY2015 1H 122 2H 118 FY2016 and onward 115

3 Business Domains / Business Size
“Information & Communication”, “Life Science”, “Environment & Energy”, and “Chemicals & Affiliates” based on five core technologies
Achievement of net sales of 300 billion yen and operating income of 50 billion yen
Net Sales (FY2030)

Net Sales (left axis)

3 R&D Expenses, Capex
Operating income (right axis)(billion yen)

Information &Communication Life Sciences
100 billion yen
100 billion yen

300

Environment & Energy
50 billion yen
Fine Organic
Synthesis

Functional
Polymer
DesignOpticalControlChemicals & Affiliates
50 billion yen

200

50.0
176.9
（16.2%）

15

Nissan Chemical Corporation Integrated Report 2018

60.0

50.0

40.0

30.0

28.6
20.0

100

Operating margin
ROE
R&D expenses/sales

FY2016-2018 total

60.0

53.8
45.0

42.7*4

40.0

28.8*

30.0
40.0

20.0
10.0
0

*3 Approval basis

R&D Expenses

0

0

2015

2021

2030

(FY)

Above 15%
Above 14%
Above 8%5 Shareholder Return

3

Capex

*4 Production commencement basis

Dividend payout ratio

Gradually increase to 40%
in FY2018

Total payout ration

Maintain 70%

（%）
80
60

Dividend payout ratio

37

67

40

10.0

50

Core Technologies(billion yen)

FY2013-2015 total

50.0

150
Biological
Evaluation

UltrafineParticle
Control

250.0（16.0%）

250

R&D Expenses, Capex (billion yen)( ) Operating margin

300.0（16.7%）

4 Financial Indicators (FY2018 target)

Full details of “Progress2030” and “Vista2021” are available online.
https://www.nissanchem.co.jp/eng/news_relese/release/en2016_05_16.pdf

20
0

37

2011

59

64

71

Total payout ration

70
40

31

29

32

31

2012

2013

2014

2015

2018
(FY)

Nissan Chemical Corporation Integrated Report 201816

“Progress2030” Long-Term Business Plan and “Vista2021” Mid-Term Business Plan

1. Outline of “Progress2030” Long-Term Business Plan

2. Outline of “Vista2021” Mid-Term Business Plan
―A Six-Year Plan starting in FY2016―

1 Corporate Vision in 2030
“A corporate group which provides new values for helping to enrich people’s lives by integrating internal and external knowledge withfacing globally-changing society”“ A group of first-class pioneers who blaze a way to the future with enthusiasm by trusts they have built and skills they have cultivated”

The plan is divided into the first three years (FY2016 to 2018) as Stage I and the second three years (FY2019 to 2021) as Stage II.

1 Ideal Situation of 2021
“Information & Communication and Life Sciences are the driving force for growth while Chemicals & Affiliates achieve a stable profit.”“Establish the foundation of Environment & Energy business and a position as a promising chemical manufacturer that keeps moving forward with a strong presence.”

2 Basic Strategies“Entering new fields by evolving, deepening and expanding unique technologies”

2 Financial target

1) Information & Communication (display, semiconductor, inorganic, optical and sensor materials)
For display, semiconductor and inorganic materials, we will provide products based on technological innovations in the market.

2. Operating income by Segment (billion yen)

1.Sales / Operating income / Net income*1 (billion yen)
Net sales (left axis)

We will also create sensor materials by using our existing technologies and optical materials by establishing optical control technologies.
2) Life Sciences (agrochemicals, veterinary pharmaceuticals, pharmaceuticals and biomedical materials)
We will strengthen the pipeline for agrochemicals and pharmaceuticals, also develop new veterinary pharmaceuticals.

Operating income (right axis)

250.0

250

In addition, we will create biomedical materials that contribute to advanced medical care using accumulated technologies for biological evaluation and material design.
3) Environment & Energy (batteries, energy harvesting and thermal control materials)
We will establish a device evaluation technology then supply battery materials and materials that contribute to efficient use of energy.
4) Chemicals & Affiliates (basic chemicals, fine chemicals and affiliates)
We will continue to carry out R&D in relation to TEPIC®-epoxy compound for LED sealants, solder resist, painting-and launch new high-performance compounds.

200
150

217.0

176.9

50.0

40.0

35.0

28.6

Chemicals

Net income (right axis)

40.0

31.0

27.1

35
25

100

20.0

15

50

10.0

0

0

2.0

2018

2021

(FY)

Pharmaceuticals

2.0

28.6

2.4

35.0 0.7

12.0

15.4

3.9
▲0.1

4.0

2015

2018

Others*2

40.0

16.7

12.9

10.8

0
2015

Agricultural Chemicals

45

30.0

22.4

Performance Materials

18.4

▲2.0

4.5
2021

(FY)

*1 Net income attributable to owners of parent*2 Others: trading, others and adjustment
Naphtha (¥/kL):FY2015 42,800 FY2016 35,400 FY2017 and onward 51,100 FX rate (¥/$): FY2015 1H 122 2H 118 FY2016 and onward 115

3 Business Domains / Business Size
“Information & Communication”, “Life Science”, “Environment & Energy”, and “Chemicals & Affiliates” based on five core technologies
Achievement of net sales of 300 billion yen and operating income of 50 billion yen
Net Sales (FY2030)

Net Sales (left axis)

3 R&D Expenses, Capex
Operating income (right axis)(billion yen)

Information &Communication Life Sciences
100 billion yen
100 billion yen

300

Environment & Energy
50 billion yen
Fine Organic
Synthesis

Functional
Polymer
DesignOpticalControlChemicals & Affiliates
50 billion yen

200

50.0
176.9
（16.2%）

15

Nissan Chemical Corporation Integrated Report 2018

60.0

50.0

40.0

30.0

28.6
20.0

100

Operating margin
ROE
R&D expenses/sales

FY2016-2018 total

60.0

53.8
45.0

42.7*4

40.0

28.8*

30.0
40.0

20.0
10.0
0

*3 Approval basis

R&D Expenses

0

0

2015

2021

2030

(FY)

Above 15%
Above 14%
Above 8%5 Shareholder Return

3

Capex

*4 Production commencement basis

Dividend payout ratio

Gradually increase to 40%
in FY2018

Total payout ration

Maintain 70%

（%）
80
60

Dividend payout ratio

37

67

40

10.0

50

Core Technologies(billion yen)

FY2013-2015 total

50.0

150
Biological
Evaluation

UltrafineParticle
Control

250.0（16.0%）

250

R&D Expenses, Capex (billion yen)( ) Operating margin

300.0（16.7%）

4 Financial Indicators (FY2018 target)

Full details of “Progress2030” and “Vista2021” are available online.
https://www.nissanchem.co.jp/eng/news_relese/release/en2016_05_16.pdf

20
0

37

2011

59

64

71

Total payout ration

70
40

31

29

32

31

2012

2013

2014

2015

2018
(FY)

Nissan Chemical Corporation Integrated Report 201816

“Progress2030” Long-Term Business Plan and “Vista2021” Mid-Term Business Plan

3. Outline of and Progress with “Vista2021 Stage I”

4 Progress with Basic Strategies

1 Basic Strategies

1) Maximizing the profit from existing products

Boosting the market shares of products for growing fields, driving overseas business expansion, and reducing costs2) Improving marketing power

Identifying market needs by moving closer to customers and obtaining information about advanced materials

3) Enhancing R&D capability

Improving existing technologies, establishing new technologies, and accelerating the development of new products

2 Sources of Growth
Increased sales*1(FY2018 vs. FY2015)

Less than one billion yen
AdBlue®

Chemicals

One to three billion yen

High purity ammonia

Over three billion yen

TEPIC®
VA

Performance Materials

Display Materials
Semiconductor Materials

3D packaging materials (TMAT), new lithography materials

ARC® (bottom anti-reflective coating)Multi-layer semiconductor process materials

Inorganic Materials

Oilfield materials
OLED materials

New Materials
Agricultural Chemicals

Sensor materials

Light control film materials

HYPERTECH®

New insecticides (in-house)

New products (acquired)

LIVALO® active ingredient (overseas)

Pharmaceuticals

Photo-alignment IPS

ROUNDUP®

ALTAIR®

Fluralaner

Overseas

Finetech®

New drugs / Expanded pipeline*1 Increased sales based on forecasts at the time of formulating our new mid-term business plan

Net sales (left axis)
250

200

150

176.9

180.3
31.4

28.6
22.4

24.0

193.4

204.0

27.1

217.0

40.0

36.8

35.0

Results for FY2017 Forecast for FY2018
50.0

35.0
28.5

27.1

30.0

100

20.0

50

10.0

Operating marginii. Launching of ROUNDUP® MAXLOAD AL Ⅲ
We expanded the line-up of ROUDUP® MAXLOAD AL series with ALⅢ (fast acting + persistenttype) for consumer use in March 2018.
iii. Growth in SUNEVER® (LCD alignment coating)
We have increased the share of smartphones and other small-and medium-sized displays, andsecured new customer for televisions.
iv. Expansion of application for inorganic materials
We launched shale oil/gas field with NanoActiv® HRT as enhancing oil recovery that have been
▲Shale oil mining site
adopted by 30 companies in North America and have enhanced the production capability.
2) Improving marketing poweri. Establishing Nissan Agro Tech India PVT. LTD. (Opened for business in September 2017)
We have enhanced sales support and extended services by cooperation with local partners in India agrochemical market, whichis expected to see significant growth. In addition, we are accelerating development of the products that meet market needs.
ii. Establishing Nissan Chemical Materials Research (Suzhou) Co., Ltd. (Opened for business in July 2018)
We have enhanced technical support and customer services in the China display materials market and are developing the products that meet market needs.
3) Enhancing R&D capability
i. Investment in PeptiStar Inc.
We have established novel synthetic method for constrained peptides. Through this technique, we are aiming to expand contracted manufacturing
and process researching services of pharmaceuticals and to develop in-house drug discovery and regenerative medicine materials.

FY2018 Sales
Outlook Level *32) Financial Indicators

Net income (right axis)

Operating income (right axis)▲BRAVECTO® spot-on for cats

5 FY2018 Sales Outlook of Future Growth Engines

3 Results for FY2017 and Forecast for FY2018
1) Sales / Operating income / Net income (billion yen)

1) Maximizing the profit from existing products
i. Increasing sales of Fluralaner (active ingredient for BRAVECTO®*2, veterinary pharmaceuticals)
In addition to chewable tablets (oral dosage forms) for dogs sold in over 85 countries, spot-on (transdermal absorbent)
for dogs and cats was released in Europe and the United States. We launched EXZOLT®*2, which is red miteexterminator for chicken, in Europe, Brazil, and other countries and have enhanced the production capability because thedemands for farm animal are expected to increase. *2 BRAVECTO® and EXZOLT® are registered trademarks of Intervet International B.V.

18.1%

Chemicals

16.1%

15.8%

R&D expenses / sales

8.9%

9.1%

Performance
Materials

0.3 to 0.6 billion yen

0.6 to 0.9 billion yen

3D packaging process materials (Semis, Others)

Light control film materials (Display, Others)

EUV under layer (Semis)

Hole injection layer materials for OLED (Display, Others)

CMOS image sensor materials(Semis, Others)

Repellant bank layer materials (Display, Others)

Total

0.1 billion yen

New TEPIC® (liquid type) (Fine Chemicals)
HYPERTECH®(high refractive) (Display, Others)

18.0%

ROE

Below 0.3 billion yen

Oilfield materials(Inorganic)

2.6 billion yen

Alignment materials for LC retarder (Display, Others)
Organosol (Insulation CTE) (Inorganic, Organo/Monomer sol)3) Shareholder Return

New high refractive materials (IM layer film) (Inorganic, Others)

Results for FY2017 Forecast for FY2018
Dividend payout ratio

37.7%

40.6%

Total payout ratio

70.7%

Maintain 70%

NEXTER® (Agro,Licensed-in)

GRACIA® (Agro, in-house)

Agricultural Chemicals
Pharmaceuticals

3D Cell culture medium

New GE API product (Custom Chemicals)

TRANSFORM™/ EXCEED™*4(Agro, Licensed-in)

0.9 billion yen

Maxacalcitol(Custom Chemicals)

0.6 billion yen

Total 4.2 billion yen
0

17

2015

2016

2017

Nissan Chemical Corporation Integrated Report 20182018 (forecast)2018 (target)

0(FY)*3 Including R&D costs deduction due to the sample shipments*4 TRANSFORM™/ EXCEED™ are trademarks of The Dow Chemical Company or its affiliates.

Nissan Chemical Corporation Integrated Report 201818

“Progress2030” Long-Term Business Plan and “Vista2021” Mid-Term Business Plan

3. Outline of and Progress with “Vista2021 Stage I”

4 Progress with Basic Strategies

1 Basic Strategies

1) Maximizing the profit from existing products

Boosting the market shares of products for growing fields, driving overseas business expansion, and reducing costs2) Improving marketing power

Identifying market needs by moving closer to customers and obtaining information about advanced materials

3) Enhancing R&D capability

Improving existing technologies, establishing new technologies, and accelerating the development of new products

2 Sources of Growth
Increased sales*1(FY2018 vs. FY2015)

Less than one billion yen
AdBlue®

Chemicals

One to three billion yen

High purity ammonia

Over three billion yen

TEPIC®
VA

Performance Materials

Display Materials
Semiconductor Materials

3D packaging materials (TMAT), new lithography materials

ARC® (bottom anti-reflective coating)Multi-layer semiconductor process materials

Inorganic Materials

Oilfield materials
OLED materials

New Materials
Agricultural Chemicals

Sensor materials

Light control film materials

HYPERTECH®

New insecticides (in-house)

New products (acquired)

LIVALO® active ingredient (overseas)

Pharmaceuticals

Photo-alignment IPS

ROUNDUP®

ALTAIR®

Fluralaner

Overseas

Finetech®

New drugs / Expanded pipeline*1 Increased sales based on forecasts at the time of formulating our new mid-term business plan

Net sales (left axis)
250

200

150

176.9

180.3
31.4

28.6
22.4

24.0

193.4

204.0

27.1

217.0

40.0

36.8

35.0

Results for FY2017 Forecast for FY2018
50.0

35.0
28.5

27.1

30.0

100

20.0

50

10.0

Operating marginii. Launching of ROUNDUP® MAXLOAD AL Ⅲ
We expanded the line-up of ROUDUP® MAXLOAD AL series with ALⅢ (fast acting + persistenttype) for consumer use in March 2018.
iii. Growth in SUNEVER® (LCD alignment coating)
We have increased the share of smartphones and other small-and medium-sized displays, andsecured new customer for televisions.
iv. Expansion of application for inorganic materials
We launched shale oil/gas field with NanoActiv® HRT as enhancing oil recovery that have been
▲Shale oil mining site
adopted by 30 companies in North America and have enhanced the production capability.
2) Improving marketing poweri. Establishing Nissan Agro Tech India PVT. LTD. (Opened for business in September 2017)
We have enhanced sales support and extended services by cooperation with local partners in India agrochemical market, whichis expected to see significant growth. In addition, we are accelerating development of the products that meet market needs.
ii. Establishing Nissan Chemical Materials Research (Suzhou) Co., Ltd. (Opened for business in July 2018)
We have enhanced technical support and customer services in the China display materials market and are developing the products that meet market needs.
3) Enhancing R&D capability
i. Investment in PeptiStar Inc.
We have established novel synthetic method for constrained peptides. Through this technique, we are aiming to expand contracted manufacturing
and process researching services of pharmaceuticals and to develop in-house drug discovery and regenerative medicine materials.

FY2018 Sales
Outlook Level *32) Financial Indicators

Net income (right axis)

Operating income (right axis)▲BRAVECTO® spot-on for cats

5 FY2018 Sales Outlook of Future Growth Engines

3 Results for FY2017 and Forecast for FY2018
1) Sales / Operating income / Net income (billion yen)

1) Maximizing the profit from existing products
i. Increasing sales of Fluralaner (active ingredient for BRAVECTO®*2, veterinary pharmaceuticals)
In addition to chewable tablets (oral dosage forms) for dogs sold in over 85 countries, spot-on (transdermal absorbent)
for dogs and cats was released in Europe and the United States. We launched EXZOLT®*2, which is red miteexterminator for chicken, in Europe, Brazil, and other countries and have enhanced the production capability because thedemands for farm animal are expected to increase. *2 BRAVECTO® and EXZOLT® are registered trademarks of Intervet International B.V.

18.1%

Chemicals

16.1%

15.8%

R&D expenses / sales

8.9%

9.1%

Performance
Materials

0.3 to 0.6 billion yen

0.6 to 0.9 billion yen

3D packaging process materials (Semis, Others)

Light control film materials (Display, Others)

EUV under layer (Semis)

Hole injection layer materials for OLED (Display, Others)

CMOS image sensor materials(Semis, Others)

Repellant bank layer materials (Display, Others)

Total

0.1 billion yen

New TEPIC® (liquid type) (Fine Chemicals)
HYPERTECH®(high refractive) (Display, Others)

18.0%

ROE

Below 0.3 billion yen

Oilfield materials(Inorganic)

2.6 billion yen

Alignment materials for LC retarder (Display, Others)
Organosol (Insulation CTE) (Inorganic, Organo/Monomer sol)3) Shareholder Return

New high refractive materials (IM layer film) (Inorganic, Others)

Results for FY2017 Forecast for FY2018
Dividend payout ratio

37.7%

40.6%

Total payout ratio

70.7%

Maintain 70%

NEXTER® (Agro,Licensed-in)

GRACIA® (Agro, in-house)

Agricultural Chemicals
Pharmaceuticals

3D Cell culture medium

New GE API product (Custom Chemicals)

TRANSFORM™/ EXCEED™*4(Agro, Licensed-in)

0.9 billion yen

Maxacalcitol(Custom Chemicals)

0.6 billion yen

Total 4.2 billion yen
0

17

2015

2016

2017

Nissan Chemical Corporation Integrated Report 20182018 (forecast)2018 (target)

0(FY)*3 Including R&D costs deduction due to the sample shipments*4 TRANSFORM™/ EXCEED™ are trademarks of The Dow Chemical Company or its affiliates.

Nissan Chemical Corporation Integrated Report 201818

Identified Materiality
We have identified the materiality needed to resolve social issues and realize our corporate vision in 2030 in addition to
responding to the ever-changing business environment.
First of all, based on our group’s long- and mid-term business plan, we clarified more than 500 keywords formateriality, referring to ESG-related metrics and guidelines.
Secondly, based on each keyword, we examined materiality factors and conducted in-house assessment from theviewpoint of the priority to our company and to our stakeholders.
Subsequently, we exchanged opinions with six stakeholders on the contents of our in-house assessment, discussed
incorporation of the stakeholders’ view point internally, and established a materiality matrix.
Clarifying Materiality
key words

In-house Assessment

Consulting Stakeholders’View Point

Identifying Materiality

We aim to provide new value for helping to enrich people’s lives through four businesses based on fivecore technologies.

Strengthening of Nissan Group’sbusiness baseWe aim to strengthen our business base to improve our ability to respond to increasingly diverse andsophisticated marketing needs.

Continuous improvementof responsible care activities

We aim to enhance the maintenance of environment, health, and safety through the operation of the Nissan
Chemical Responsible Care Management System.

Provision of new value for helping to enrichpeople’s lives

Contribution to health issues

Creation of pharmaceuticals that meet medical needs and biomedical materials that
contribute to advanced medical cares

Supply of environmentallyfriendly products and services

Sales of high-grade urea solution for exhaust gas purification of diesel vehicles
Development of energy harvesting materials that contribute to the utilization of unused energy

Contribution to the improvement of the quality of life

Supply of veterinary pharmaceuticals for companion animals and sales of disinfectantsfor drinking-water

Contribution to smart society

Development of sensor materials required for IoT and wiring materials that contribute tohigher capacities and speeds of data communications

Contribution to the food issues

Supply of agrochemicals to increase crop yields and conserve agricultural labor, and the
expansion of veterinary pharmaceuticals to livestock

Enhancement of R&D capability

Deepening core technologies, promotion of open innovation, and introduction of newtechnologies such as AI

Improvement of products quality

Continuous improvement of management systems and operations based on quality policy

Maintenance and improvement of employees’ health

Review of health promotion measures by the health promotion committee and mental
health checkups

Creation of a comfortableworkplace

Promotion of work-life balance, measures against harassment, and support for childcare andfamily care

Personnel retention and trainings

Provision of educations and capability trainings, and introduction of overseas
study program

Promotion of diversity

Promotion of active participation of women, hiring foreign students and people
with disabilities

Promotion of fair-trading

Implementation of internal training on the “Act against Delay in Payment of Subcontract
Proceeds, Etc. to Subcontractors” and the insider trading regulations

Promotion of CSR procurement

Conduct of assessment and audits of suppliers on CSR

Adaption to climate change

Formulation of BCPs to prepare for the plants’ inability to operate due to natural disasters

Mitigation of climate change

Energy saving through equipment improvement and fuel conversion that leads to
GHG emissions reduction

Promotion of occupational
health and safety

Establishment of an occupational safety management system and execution ofcapital investment in safety

Biodiversity conservation

Operation of Bio-Park and support for the NPO “Kurohama-numa Shuhen no Shizen wo
Taisetsu ni Suru Kai”

Management of chemical
substances

Minimization of negative impacts on human health and the environment throughout
the life cycle of chemical products

Reduction of industrial waste
and pollutant emissions

Reduction of the amount of waste for final disposal volume by reusing and recycling
waste and changing intermediate process methods

Strengthening of Nissan Group’s business baseCrucial issues for corporate survival
Strengthening of Corporate Governance, Risk Management and Compliance
Maintenance and improvement of
employees’ health
Personnel retention and trainings

Contribution to local society

FactorInternal approval(Resolution of theBoard of Directors)

Provision of new value for helping toenrich people’s lives

High

Materiality

Contribution to health issues

Promotion of diversity

Supply of environmentally friendly
products and services

Promotion of fair-trading

Enhancement of R&D capability

Promotion of CSR procurement

Mitigation of climate change

Promotion of occupational healthand safety

to Stakeholders

Continuous improvement of responsible care
activities
Improvement of products quality

Water resources conservation
Improvement of capital efficiency

Enhancement of information security
Priority

19

Nissan Chemical Corporation Integrated Report 2018

Creation of a comfortable workplace

Contribution to the improvement of
the quality of life

Biodiversity conservation

Contribution to smart societyManagement of chemical substances

Contribution to the food issues

Reduction of industrial waste andpollutant emissions

Adaption to climate change

Improvement of marketing powerIntellectual properties Exploitation
to the Company

Our Initiative

Expanding business domains
High

Nissan Chemical Corporation Integrated Report 201820

Identified Materiality
We have identified the materiality needed to resolve social issues and realize our corporate vision in 2030 in addition to
responding to the ever-changing business environment.
First of all, based on our group’s long- and mid-term business plan, we clarified more than 500 keywords formateriality, referring to ESG-related metrics and guidelines.
Secondly, based on each keyword, we examined materiality factors and conducted in-house assessment from theviewpoint of the priority to our company and to our stakeholders.
Subsequently, we exchanged opinions with six stakeholders on the contents of our in-house assessment, discussed
incorporation of the stakeholders’ view point internally, and established a materiality matrix.
Clarifying Materiality
key words

In-house Assessment

Consulting Stakeholders’View Point

Identifying Materiality

We aim to provide new value for helping to enrich people’s lives through four businesses based on fivecore technologies.

Strengthening of Nissan Group’sbusiness baseWe aim to strengthen our business base to improve our ability to respond to increasingly diverse andsophisticated marketing needs.

Continuous improvementof responsible care activities

We aim to enhance the maintenance of environment, health, and safety through the operation of the Nissan
Chemical Responsible Care Management System.

Provision of new value for helping to enrichpeople’s lives

Contribution to health issues

Creation of pharmaceuticals that meet medical needs and biomedical materials that
contribute to advanced medical cares

Supply of environmentallyfriendly products and services

Sales of high-grade urea solution for exhaust gas purification of diesel vehicles
Development of energy harvesting materials that contribute to the utilization of unused energy

Contribution to the improvement of the quality of life

Supply of veterinary pharmaceuticals for companion animals and sales of disinfectantsfor drinking-water

Contribution to smart society

Development of sensor materials required for IoT and wiring materials that contribute tohigher capacities and speeds of data communications

Contribution to the food issues

Supply of agrochemicals to increase crop yields and conserve agricultural labor, and the
expansion of veterinary pharmaceuticals to livestock

Enhancement of R&D capability

Deepening core technologies, promotion of open innovation, and introduction of newtechnologies such as AI

Improvement of products quality

Continuous improvement of management systems and operations based on quality policy

Maintenance and improvement of employees’ health

Review of health promotion measures by the health promotion committee and mental
health checkups

Creation of a comfortableworkplace

Promotion of work-life balance, measures against harassment, and support for childcare andfamily care

Personnel retention and trainings

Provision of educations and capability trainings, and introduction of overseas
study program

Promotion of diversity

Promotion of active participation of women, hiring foreign students and people
with disabilities

Promotion of fair-trading

Implementation of internal training on the “Act against Delay in Payment of Subcontract
Proceeds, Etc. to Subcontractors” and the insider trading regulations

Promotion of CSR procurement

Conduct of assessment and audits of suppliers on CSR

Adaption to climate change

Formulation of BCPs to prepare for the plants’ inability to operate due to natural disasters

Mitigation of climate change

Energy saving through equipment improvement and fuel conversion that leads to
GHG emissions reduction

Promotion of occupational
health and safety

Establishment of an occupational safety management system and execution ofcapital investment in safety

Biodiversity conservation

Operation of Bio-Park and support for the NPO “Kurohama-numa Shuhen no Shizen wo
Taisetsu ni Suru Kai”

Management of chemical
substances

Minimization of negative impacts on human health and the environment throughout
the life cycle of chemical products

Reduction of industrial waste
and pollutant emissions

Reduction of the amount of waste for final disposal volume by reusing and recycling
waste and changing intermediate process methods

Strengthening of Nissan Group’s business baseCrucial issues for corporate survival
Strengthening of Corporate Governance, Risk Management and Compliance
Maintenance and improvement of
employees’ health
Personnel retention and trainings

Contribution to local society

FactorInternal approval(Resolution of theBoard of Directors)

Provision of new value for helping toenrich people’s lives

High

Materiality

Contribution to health issues

Promotion of diversity

Supply of environmentally friendly
products and services

Promotion of fair-trading

Enhancement of R&D capability

Promotion of CSR procurement

Mitigation of climate change

Promotion of occupational healthand safety

to Stakeholders

Continuous improvement of responsible care
activities
Improvement of products quality

Water resources conservation
Improvement of capital efficiency

Enhancement of information security
Priority

19

Nissan Chemical Corporation Integrated Report 2018

Creation of a comfortable workplace

Contribution to the improvement of
the quality of life

Biodiversity conservation

Contribution to smart societyManagement of chemical substances

Contribution to the food issues

Reduction of industrial waste andpollutant emissions

Adaption to climate change

Improvement of marketing powerIntellectual properties Exploitation
to the Company

Our Initiative

Expanding business domains
High

Nissan Chemical Corporation Integrated Report 201820

Process of Value Creation
Nissan Chemical Group is developing its business activities in four business domains based on the five coretechnologies those have been cultivated over the years.
We aim to achieve sustainable growth together with society by making effort at the materiality identified byrecognizing various social issues and changes.

Social Issues and Changes

Advanced climate change

Materiality

Business Domains

Output (Main Products)

Create new technologies and products that meet emerging

and latent needs

Global crisis
Worsening health issues

Provision of new value forhelping to enrich people’s lives

Information & Communication

Exacerbation of the food issues

Information &Communication

Diversification of risk factors
Intensification of inter-corporate
competitions
Changes in lifestyleStrengthening of NissanGroup’s business base

Increase of requests for CSR

Human Resources
R&D Capability
Financial Base
Environment& Energy

considerations in the Supply Chain

Strength

Life
Sciences

Chemicals& Affiliates

Increase of requests forconsideration of health andsafety in the work environment

Continuous improvement ofresponsible care activities

Labor shortage

Life Sciences

Increase of requests for information
disclosure

21

Nissan Chemical Corporation Integrated Report 2018

Financial Indicators (FY2018)
Operating Margin: Above15%
ROE: Above 14%
R&D Expenses / Sales: Above 8%

Environment & Energy

Proportion of women among
employees in the main career track
FY2021: 10%

Chemicals & Affiliates
Basic Chemicals
Fine Chemicals

Greenhouse Gas
Emissions:
20% reduction from FY2011
level by FY2021
Emission rate (Emissions / sales):
40% reduction from FY2011
level by FY2021“A corporate group which
provides new values forhelping to enrich people’s lives
by integrating internaland external knowledge withfacing globally-changing
society”“A group of first-class pioneers
who blaze a way to the futurewith enthusiasm by trusts they
have built and skills they havecultivated”

Industrial Waste
FY2021:
99.5% or more recycling rate

Increase of interest in corporate
governance reform

Operating Income
FY2021: 40 billion yen
FY2030: 50 billion yen

Shareholder Return (FY2018)
Dividend Payout Ratio: 40%
Total Payout Ratio: Maintain 70%

Oilfield Materials
Secondary Battery Materials

Corporate Vision in 2030

Sales
FY2021: 250 billion yen
FY2030: 300 billion yen

Agrochemicals
Pharmaceuticals
Veterinary Pharmaceuticals
Biomedical Materials

Core Technologies
Fine Organic Synthesis, Functional
Polymer Design, Ultrafine Particle Control,
Biological Evaluation, Optical Control

Advent of a smart society

Display Materials
Semiconductor Materials
Optical Interconnect Materials

Targets

Business Model Future-Creating Enterprise that Responds to Social Needs

with Unique, Innovative Technologies

Strategies

Mid-Term Business Plan

“Progress2030” Long-Term Business Plan and “Vista2021”

Occupational Safety and Health
FY2021:
Zero accident that requires
staff time off from work

Nissan Chemical Corporation Integrated Report 201822

Process of Value Creation
Nissan Chemical Group is developing its business activities in four business domains based on the five coretechnologies those have been cultivated over the years.
We aim to achieve sustainable growth together with society by making effort at the materiality identified byrecognizing various social issues and changes.

Social Issues and Changes

Advanced climate change

Materiality

Business Domains

Output (Main Products)

Create new technologies and products that meet emerging

and latent needs

Global crisis
Worsening health issues

Provision of new value forhelping to enrich people’s lives

Information & Communication

Exacerbation of the food issues

Information &Communication

Diversification of risk factors
Intensification of inter-corporate
competitions
Changes in lifestyleStrengthening of NissanGroup’s business base

Increase of requests for CSR

Human Resources
R&D Capability
Financial Base
Environment& Energy

considerations in the Supply Chain

Strength

Life
Sciences

Chemicals& Affiliates

Increase of requests forconsideration of health andsafety in the work environment

Continuous improvement ofresponsible care activities

Labor shortage

Life Sciences

Increase of requests for information
disclosure

21

Nissan Chemical Corporation Integrated Report 2018

Financial Indicators (FY2018)
Operating Margin: Above15%
ROE: Above 14%
R&D Expenses / Sales: Above 8%

Environment & Energy

Proportion of women among
employees in the main career track
FY2021: 10%

Chemicals & Affiliates
Basic Chemicals
Fine Chemicals

Greenhouse Gas
Emissions:
20% reduction from FY2011
level by FY2021
Emission rate (Emissions / sales):
40% reduction from FY2011
level by FY2021“A corporate group which
provides new values forhelping to enrich people’s lives
by integrating internaland external knowledge withfacing globally-changing
society”“A group of first-class pioneers
who blaze a way to the futurewith enthusiasm by trusts they
have built and skills they havecultivated”

Industrial Waste
FY2021:
99.5% or more recycling rate

Increase of interest in corporate
governance reform

Operating Income
FY2021: 40 billion yen
FY2030: 50 billion yen

Shareholder Return (FY2018)
Dividend Payout Ratio: 40%
Total Payout Ratio: Maintain 70%

Oilfield Materials
Secondary Battery Materials

Corporate Vision in 2030

Sales
FY2021: 250 billion yen
FY2030: 300 billion yen

Agrochemicals
Pharmaceuticals
Veterinary Pharmaceuticals
Biomedical Materials

Core Technologies
Fine Organic Synthesis, Functional
Polymer Design, Ultrafine Particle Control,
Biological Evaluation, Optical Control

Advent of a smart society

Display Materials
Semiconductor Materials
Optical Interconnect Materials

Targets

Business Model Future-Creating Enterprise that Responds to Social Needs

with Unique, Innovative Technologies

Strategies

Mid-Term Business Plan

“Progress2030” Long-Term Business Plan and “Vista2021”

Occupational Safety and Health
FY2021:
Zero accident that requires
staff time off from work

Nissan Chemical Corporation Integrated Report 201822

Main Products

Nissan Chemical Products that Play an Active Role in Society

Performance Materials

Here we introduce our three business domains and products used in various parts of society.

AdBlueDisplay Materials

Inorganic Materials

Semiconductor Materials®

● SUNEVER® (LCD alignment coating)● ARC® (bottom anti-reflective coating)● NHC® (inorganic coating materials)● SNOWTEX® (semiconductor polishing, hardcoating, etc.)● Organo silica sol (coating for anti-scratch,
insulation, CTE reduction)

ROUNDUP® MAXLOADSNOWTEX®
LEIMAY® / ORACLE®

Image

Image

LCD TVImage

HI-LITE®
STARMITE® / SANMITE®
SIRIUS® / ALTAIR®

Life Sciences
TEPIC®
SUNEVER®

Agricultural Chemicals
Herbicide

LIVALO® / LANDEL®

Pharmaceuticals

Fungicide● SIRIUS®

● STARMITE®

● LEIMAY ®

● ALTAIR®

● SANMITE®

● ORACLE ®

● ROUNDUPMAXLOAD®

Melamine

Insecticide● PULSOR®

● TARGA®

ARC®

● PERMIT®

Active ingredient for veterinary pharmaceuticals● Fluralaner

Chemicals
Chemicals● LIVALO® (anti-cholesterol agent)● Melamine (adhesive agent for particle board)● LANDEL® (anti-hypertension agent)● High purity chemicals● AdBlue® (high-grade urea solution)

Novel agent under development● NIP-022 (thrombocytopenia treatment
agent)● NTC-801 (anti-arrhythmic agent)● FINEOXOCOL®
● TEPIC® (epoxy compound for LED sealants,
solder resist, painting)● Melamine cyanurate (flame retardant)● HI-LITE® (chlorinated isocyanuric acid for sterilizing)● Nissan Reishi (health food)

Fluralaner

23

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201824

Main Products

Nissan Chemical Products that Play an Active Role in Society

Performance Materials

Here we introduce our three business domains and products used in various parts of society.

AdBlueDisplay Materials

Inorganic Materials

Semiconductor Materials®

● SUNEVER® (LCD alignment coating)● ARC® (bottom anti-reflective coating)● NHC® (inorganic coating materials)● SNOWTEX® (semiconductor polishing, hardcoating, etc.)● Organo silica sol (coating for anti-scratch,
insulation, CTE reduction)

ROUNDUP® MAXLOADSNOWTEX®
LEIMAY® / ORACLE®

Image

Image

LCD TVImage

HI-LITE®
STARMITE® / SANMITE®
SIRIUS® / ALTAIR®

Life Sciences
TEPIC®
SUNEVER®

Agricultural Chemicals
Herbicide

LIVALO® / LANDEL®

Pharmaceuticals

Fungicide● SIRIUS®

● STARMITE®

● LEIMAY ®

● ALTAIR®

● SANMITE®

● ORACLE ®

● ROUNDUPMAXLOAD®

Melamine

Insecticide● PULSOR®

● TARGA®

ARC®

● PERMIT®

Active ingredient for veterinary pharmaceuticals● Fluralaner

Chemicals
Chemicals● LIVALO® (anti-cholesterol agent)● Melamine (adhesive agent for particle board)● LANDEL® (anti-hypertension agent)● High purity chemicals● AdBlue® (high-grade urea solution)

Novel agent under development● NIP-022 (thrombocytopenia treatment
agent)● NTC-801 (anti-arrhythmic agent)● FINEOXOCOL®
● TEPIC® (epoxy compound for LED sealants,
solder resist, painting)● Melamine cyanurate (flame retardant)● HI-LITE® (chlorinated isocyanuric acid for sterilizing)● Nissan Reishi (health food)

Fluralaner

23

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201824

Main Products

Environmentally Friendly Products
We define environmentally friendly products as the products that reduce environmental impact across each of the processes below, from manufacture to distribution, use anddisposal, or that play an important role in achieving that goal. We have set ourselves the goal of improving the percentage of our products that are environmentally friendly.

Manufacture

Distribution

i. Saving energy
iv. Reducing waste and environmental pollutants

Use

ii. Reducing CO2
v. Purifying air and water

Disposaliii. Conserving resources (water, raw materials)
vi. Renewable (new) energy

Chemicals
AdBlue®
AdBlue® is a high-grade urea solution used in “urea SCR system”, a technology for purifying
emissions. When sprayed onto emissions from diesel vehicles, it breaks down nitrogenoxide (NOx) into harmless nitrogen and water, which helps to reduce environmental impact.
We supply AdBlue® in line with each customer’s needs, in tank trucks, 200L drums, 1m3
containers, or BIB (Bag-in Box, 20L, 10L).

Performance Materials▲AdBlue®

HYPERTECH®

HI-LITE®

Nucleating agents for electroless plating
Nucleating agents make it possible to reduce the amount of metal used for wiring initems such as flexible printed substrates or touch panels by more than 90%.
Metal wiring is made by forming a metal film across the entire surface of the substrate
in a vacuum, and then removing unwanted parts with acid. HYPERTECH® makes it
possible to draw wiring patterns, meaning that metal only adheres to drawn lines. This inturn minimizes the amount of metal plating required.

HI-LITE® is widely used to assist with environmental sanitation for purposes suchas disinfecting and sterilizing pools and septic tanks. Having obtained certification
under NSF / ANSI-60 (the standard for chemicals intentionally added to drinking water),there is new scope to expand the range of applications for HI-LITE® for sterilizing drinking
water, such as applying in areas where standards of sanitation are insufficient, particularly indeveloping countries.

Coating materials with ultra-high refractive index
OLED lighting is known as one of low environmental impact application. HYPERTECH® makes
a film that is applied between the electrodes and substrate, or between the electrodes andlight source of OLED and makes it possible to improve light efficiency from the light source by
up to 20%. This product is transparent and heat resistant, and offers excellent adhesion todifferent substrate materials. Ease of application can also help to reduce manufacturing costs.

▲Touch panel▲Hygienic water supplies (illustration purposes only)

Venus® Oilclean▲OLED lighting (illustration purposes only)

Inorganic Materials
SNOWTEX®, Aluminasol, Organo silica sol, NanoUse® ZR
Materials can be used for a wide range of purposes, including saving energy fromtransformers, improving the efficiency of natural energy, purifying emissions, andextending the life of motors.

▲Industrial water treated with wastewater (illustration purposes only)▲Purifying emissions (illustration purposes only)

Advanced Materials & Planning

Agricultural Chemicals

ECOPROMOTE® SeriesCompact agrochemical formulations

ECOPROMOTE® is a crystal nucleating agent for polylactate. Combining theproperties of a bioplastic, made from plant instead of oil, and a biodegradable plastic
that is broken down into water and carbon dioxide by microorganisms, polylactate is
the foremost carbon neutral synthetic resin in terms of practical application. Uses arenonetheless limited due to issues relating to moldability and heat resistance.
ECOPROMOTE® stimulates the growth of polylactate crystals, and can be used forhigh speed injection molding or extrusion molding without affecting transparency. As aresult, it is increasingly being used for durable purposes such as electronic devices,
printers and filaments in 3D printers.

We supply lightweight and compact agrochemical formulations
that contain a high concentration of active ingredients, including
WG (Water dispersible) and Jumbo (floating granules, containing
active ingredients, wrapped in a soluble film). This helps in ways
such as reducing packaging materials, waste products, and CO2
emissions from manufacturing and shipping.

25

Venus® Oilclean is a microorganism formulation that decomposes oils and fats in
wastewater from food factories and other facilities. Compared to the pressurized
floating facility, which is a typical oils and fats in wastewater treatment system, thefacility using Venus® Oilclean significantly reduces odors and workload as well as
waste with simple equipment. Some major food factories have reduced the amountof waste derived from oils and fats to almost zero by introducing this product.

Nissan Chemical Corporation Integrated Report 2018

▲Comet WG▲Tenku Jumbo▲3D printerNissan Chemical Corporation Integrated Report 201826

Main Products

Environmentally Friendly Products
We define environmentally friendly products as the products that reduce environmental impact across each of the processes below, from manufacture to distribution, use anddisposal, or that play an important role in achieving that goal. We have set ourselves the goal of improving the percentage of our products that are environmentally friendly.

Manufacture

Distribution

i. Saving energy
iv. Reducing waste and environmental pollutants

Use

ii. Reducing CO2
v. Purifying air and water

Disposaliii. Conserving resources (water, raw materials)
vi. Renewable (new) energy

Chemicals
AdBlue®
AdBlue® is a high-grade urea solution used in “urea SCR system”, a technology for purifying
emissions. When sprayed onto emissions from diesel vehicles, it breaks down nitrogenoxide (NOx) into harmless nitrogen and water, which helps to reduce environmental impact.
We supply AdBlue® in line with each customer’s needs, in tank trucks, 200L drums, 1m3
containers, or BIB (Bag-in Box, 20L, 10L).

Performance Materials▲AdBlue®

HYPERTECH®

HI-LITE®

Nucleating agents for electroless plating
Nucleating agents make it possible to reduce the amount of metal used for wiring initems such as flexible printed substrates or touch panels by more than 90%.
Metal wiring is made by forming a metal film across the entire surface of the substrate
in a vacuum, and then removing unwanted parts with acid. HYPERTECH® makes it
possible to draw wiring patterns, meaning that metal only adheres to drawn lines. This inturn minimizes the amount of metal plating required.

HI-LITE® is widely used to assist with environmental sanitation for purposes suchas disinfecting and sterilizing pools and septic tanks. Having obtained certification
under NSF / ANSI-60 (the standard for chemicals intentionally added to drinking water),there is new scope to expand the range of applications for HI-LITE® for sterilizing drinking
water, such as applying in areas where standards of sanitation are insufficient, particularly indeveloping countries.

Coating materials with ultra-high refractive index
OLED lighting is known as one of low environmental impact application. HYPERTECH® makes
a film that is applied between the electrodes and substrate, or between the electrodes andlight source of OLED and makes it possible to improve light efficiency from the light source by
up to 20%. This product is transparent and heat resistant, and offers excellent adhesion todifferent substrate materials. Ease of application can also help to reduce manufacturing costs.

▲Touch panel▲Hygienic water supplies (illustration purposes only)

Venus® Oilclean▲OLED lighting (illustration purposes only)

Inorganic Materials
SNOWTEX®, Aluminasol, Organo silica sol, NanoUse® ZR
Materials can be used for a wide range of purposes, including saving energy fromtransformers, improving the efficiency of natural energy, purifying emissions, andextending the life of motors.

▲Industrial water treated with wastewater (illustration purposes only)▲Purifying emissions (illustration purposes only)

Advanced Materials & Planning

Agricultural Chemicals

ECOPROMOTE® SeriesCompact agrochemical formulations

ECOPROMOTE® is a crystal nucleating agent for polylactate. Combining theproperties of a bioplastic, made from plant instead of oil, and a biodegradable plastic
that is broken down into water and carbon dioxide by microorganisms, polylactate is
the foremost carbon neutral synthetic resin in terms of practical application. Uses arenonetheless limited due to issues relating to moldability and heat resistance.
ECOPROMOTE® stimulates the growth of polylactate crystals, and can be used forhigh speed injection molding or extrusion molding without affecting transparency. As aresult, it is increasingly being used for durable purposes such as electronic devices,
printers and filaments in 3D printers.

We supply lightweight and compact agrochemical formulations
that contain a high concentration of active ingredients, including
WG (Water dispersible) and Jumbo (floating granules, containing
active ingredients, wrapped in a soluble film). This helps in ways
such as reducing packaging materials, waste products, and CO2
emissions from manufacturing and shipping.

25

Venus® Oilclean is a microorganism formulation that decomposes oils and fats in
wastewater from food factories and other facilities. Compared to the pressurized
floating facility, which is a typical oils and fats in wastewater treatment system, thefacility using Venus® Oilclean significantly reduces odors and workload as well as
waste with simple equipment. Some major food factories have reduced the amountof waste derived from oils and fats to almost zero by introducing this product.

Nissan Chemical Corporation Integrated Report 2018

▲Comet WG▲Tenku Jumbo▲3D printerNissan Chemical Corporation Integrated Report 201826

Business Overview

Performance Materials
We will continue to expand the business by actively developing display, semiconductor and inorganic materials, as well as new materials for new
fields.

Main Products
SUNEVER®

Display Materials
We continue to develop our display materials business, spearheaded by SUNEVER® polyimide-based LCD alignment coating materials and
NHC® insulating hard coating materials, by catering to the growing needs of the display market, particularly in Asia.

Semiconductor Materials
We provide ARC® (bottom anti-reflective coating materials), OptiStack®* (muliti layer process materials) and temporary bonding materials for3D package, that are necessary for semiconductor manufacturing processes.
*OptiStack® is a registered trade mark of Brewer Science, Inc.

SUNEVER is a polyimide-based coating for LCD / flat panel
displays. It is used to coat the surface of the outer glass panels, toalign liquid crystal molecules in a certain direction. We offer
various grades of this product for small-and medium-sized
screens, such as LCD monitors, PCs, tablets and smartphones, inaddition to those for the latest flat-panel LCD TVs.

We have continuously provided nano-colloids, such as SNOWTEX® and organo silica sol, to variety of industries for many years using“Ultrafine Particle Control technology”, one of our core technologies. In these years, we have developed oilfield materials as new field for us.

New Products
Our development focuses on next generation products that identify the future needs of customers.

50
40
30

49.4

51.8

12.0

12.0

52.8

58.8

20

12.5

14.2

14.1
10

5

10
2014

2015

SpacerColor filter

ARC® is an anti-reflective coating developed for semiconductor lithography. It is used to coat the part under the photoresist, to resolve a number of issues
with lithographic exposure such as reflection from varying substrate levels. This makes it possible to significantly reduce the device failure rate.
Mask

Exposure

ResistResist2016

Mask

Exposure

ResistResistARC®

Substrate

2017

In FY2017, sales of display materials was strong in
SUNEVER® for small to medium size displays, such as
smart-phone. For semiconductor materials, sales of ARC® and
OptiStack® increased due to the commencement of operations
at new factories by some customers and recovery in capacity
utilizations. In inorganic materials sales, both SNOWTEX® andorgano silica sol / monomer sol performed well.

0
2018 (Outlook) (FY)T O P I C S

Establishing Local subsidiary in Suzhou, China
We established Nissan Chemical Materials Research (Suzhou) Co., Ltd. in July 2017 for
China display market which is expected to grow in the future. We will strengthen our
technical support and customer services, and aggressively develop products thatmeet market needs, with the aim of further expanding our business.

Substrate

SNOWTEX®, Organo silica sol
SNOWTEX® (colloid solution with nano-sized silica particles
dispersed stably in water) and the organo silica sol (colloid
solution with nano-sized silica particles dispersed stably in organic
solvent) are used in a wide range of fields, including optical film
coatings and electronic recording media abrasives. We have also
developed monomer sol dispersed in epoxy and methacrylate. It
can be used in solvent-free applications.

▲Tablet device

OLED materials
BaseSouth Korea: Pyeongtaek (NCK)

China: Shanghai (NCS)
Suzhou (NSU)

We are focusing on developing markets for OLED, which is
expected to grow in the future as a next-generation display. In
addition to coating hole-injection layer materials and TFT
planarizing film materials, we are currently moving forward withthe development of distinctive peripheral materials, including bankmaterials that help ensure the uniformity of pixels during inkjet
application, and optical alignment materials used for anti-reflective
retardation films.

Taiwan: Kaohsiung (NCT)

Nissan Chemical Corporation Integrated Report 2018

▲Silicon wafer

Polarizer (optical alignment
material+coating polarizer)
Light

Barrier layer (SiN)

Emission layer
Anode (reflective anode)

TFT array

Film substrate

27▲LCD TV(billion yen)

62.5

15

20

0

Alignment
film
Liquid crystal

Effects of anti-reflective coatings

Operating income (right axis)

70
60

Transparent
electrode▲LCD panel

Business Results and Outlook
Sales (left axis)

Glass substrate

ARC® (bottom anti-reflective coating)

Inorganic Materials(billion yen)

Polarizing filter

Backlight®

Glass substrate

Retardation film (optical alignment
material+coating liquid crystal)Light extraction layer
Sealing / planarizing materials
Bank material (photosensitive
liquid repellant material)
Hole-injection layer (HIL)
TFT planarization layer(photosensitive acrylic)
Release layer

Nissan Chemical Corporation Integrated Report 201828

Business Overview

Performance Materials
We will continue to expand the business by actively developing display, semiconductor and inorganic materials, as well as new materials for new
fields.

Main Products
SUNEVER®

Display Materials
We continue to develop our display materials business, spearheaded by SUNEVER® polyimide-based LCD alignment coating materials and
NHC® insulating hard coating materials, by catering to the growing needs of the display market, particularly in Asia.

Semiconductor Materials
We provide ARC® (bottom anti-reflective coating materials), OptiStack®* (muliti layer process materials) and temporary bonding materials for3D package, that are necessary for semiconductor manufacturing processes.
*OptiStack® is a registered trade mark of Brewer Science, Inc.

SUNEVER is a polyimide-based coating for LCD / flat panel
displays. It is used to coat the surface of the outer glass panels, toalign liquid crystal molecules in a certain direction. We offer
various grades of this product for small-and medium-sized
screens, such as LCD monitors, PCs, tablets and smartphones, inaddition to those for the latest flat-panel LCD TVs.

We have continuously provided nano-colloids, such as SNOWTEX® and organo silica sol, to variety of industries for many years using“Ultrafine Particle Control technology”, one of our core technologies. In these years, we have developed oilfield materials as new field for us.

New Products
Our development focuses on next generation products that identify the future needs of customers.

50
40
30

49.4

51.8

12.0

12.0

52.8

58.8

20

12.5

14.2

14.1
10

5

10
2014

2015

SpacerColor filter

ARC® is an anti-reflective coating developed for semiconductor lithography. It is used to coat the part under the photoresist, to resolve a number of issues
with lithographic exposure such as reflection from varying substrate levels. This makes it possible to significantly reduce the device failure rate.
Mask

Exposure

ResistResist2016

Mask

Exposure

ResistResistARC®

Substrate

2017

In FY2017, sales of display materials was strong in
SUNEVER® for small to medium size displays, such as
smart-phone. For semiconductor materials, sales of ARC® and
OptiStack® increased due to the commencement of operations
at new factories by some customers and recovery in capacity
utilizations. In inorganic materials sales, both SNOWTEX® andorgano silica sol / monomer sol performed well.

0
2018 (Outlook) (FY)T O P I C S

Establishing Local subsidiary in Suzhou, China
We established Nissan Chemical Materials Research (Suzhou) Co., Ltd. in July 2017 for
China display market which is expected to grow in the future. We will strengthen our
technical support and customer services, and aggressively develop products thatmeet market needs, with the aim of further expanding our business.

Substrate

SNOWTEX®, Organo silica sol
SNOWTEX® (colloid solution with nano-sized silica particles
dispersed stably in water) and the organo silica sol (colloid
solution with nano-sized silica particles dispersed stably in organic
solvent) are used in a wide range of fields, including optical film
coatings and electronic recording media abrasives. We have also
developed monomer sol dispersed in epoxy and methacrylate. It
can be used in solvent-free applications.

▲Tablet device

OLED materials
BaseSouth Korea: Pyeongtaek (NCK)

China: Shanghai (NCS)
Suzhou (NSU)

We are focusing on developing markets for OLED, which is
expected to grow in the future as a next-generation display. In
addition to coating hole-injection layer materials and TFT
planarizing film materials, we are currently moving forward withthe development of distinctive peripheral materials, including bankmaterials that help ensure the uniformity of pixels during inkjet
application, and optical alignment materials used for anti-reflective
retardation films.

Taiwan: Kaohsiung (NCT)

Nissan Chemical Corporation Integrated Report 2018

▲Silicon wafer

Polarizer (optical alignment
material+coating polarizer)
Light

Barrier layer (SiN)

Emission layer
Anode (reflective anode)

TFT array

Film substrate

27▲LCD TV(billion yen)

62.5

15

20

0

Alignment
film
Liquid crystal

Effects of anti-reflective coatings

Operating income (right axis)

70
60

Transparent
electrode▲LCD panel

Business Results and Outlook
Sales (left axis)

Glass substrate

ARC® (bottom anti-reflective coating)

Inorganic Materials(billion yen)

Polarizing filter

Backlight®

Glass substrate

Retardation film (optical alignment
material+coating liquid crystal)Light extraction layer
Sealing / planarizing materials
Bank material (photosensitive
liquid repellant material)
Hole-injection layer (HIL)
TFT planarization layer(photosensitive acrylic)
Release layer

Nissan Chemical Corporation Integrated Report 201828

Business Overview

Agricultural Chemicals
Provide a stable supply of food to people around the world. Provide agrochemicals that are environmentally friendly. This is what we aim to do.
We have integrated system from exploratory, research, development to manufacture and sales of new agricultural agents for mainstay
crops around the world as well as those in Japan. We also develop agents in collaborative efforts, and actively acquire agents from othercompanies. We constantly work to expand our product lineup and sell our products in Japan and other countries.

SIRIUS®
To meet the needs of farmers, we develop and sell a large number of one-shot herbicides for paddy rice. The main component of these herbicides
is SIRIUS®, our proprietary active ingredient. We have been marketing these products in more than 20 countries for over 20 years.

TARGA®

Agrochemicals

This herbicide controls gramineous weeds that affect broadleaf crops such as soy beans, rapeseed, beets, cotton and sunflowers. It is used in morethan 40 countries, including India and countries in the United States and Europe.

We develop, manufacture, and sell herbicides, insecticides, fungicides, and other products used for the management of agricultural land and green land.

PERMIT®

Veterinary Pharmaceuticals

This product has effect against cyperaceous weeds extremely. We market this product in Japan under the trade names of HICUT®, which is a herbicide
for paddy rice in the mid to late term that is highly effective against the pesky weed Eleocharis kuroguwai, and INPOOL®, for lawns. We also market it
as PERMIT® in more than 20 overseas countries as an herbicide for paddy rice, corn fields, sugar cane fields and lawns.

We develop and manufacture active pharmaceutical ingredients used in ectoparasiticides for companion animals.

■ Insecticide

Business Results and Outlook
Sales (left axis)(billion yen)
70
60

45.7

50

Operating income (right axis)

47.5

40

52.0

58.1
16.4

13.2

30

9.2

20

63.0
17.7

(billion yen)
20

15

10

10.8

STARMITE®

5In FY2017, shipment of Fluralaner expanded and sales of
ALTAIR® was strong. ROUNDUP® MAXLOAD contributed tohigher revenues by launching new product ROUNDUP®
MAXLOAD AL Ⅲ that is more effective and persistent in
weeding than conventional products. In addition, shipmentsof agrochemicals to overseas markets were strong.

10
0

2014

2015

2016

2017

SANMITE®
This insecticide / acaricide is effective against spider mites and rust mites in fruit trees, as well as spider
mites and whiteflies in vegetables. We also market this product in about 30 overseas countries.

▲STARMITE®

▲LEIMAY®

■ Fungicide
LEIMAY®, ORACLE®

02018 (Outlook) (FY)

These fungicides have specific activity for diseases caused by oomycetes and myxomycetes. We sell LEIMAY®, which is used as an
atomizing agent for potatoes, grapes and vegetables, and ORACLE®, which is used for preventing and eliminating the root-knot diseaseof cruciferous vegetables and soil-borne diseases of potatoes, rice, vegetables and lawns. BESGREEN® meanwhile is designed toprevent diseases in lawns, and is sold in domestic and more than 20 overseas countries including Europe, South Korea and China.

Main Products■ Herbicide
ALTAIR

This acaricide prevents and eliminates spider mites from fruits, tea and vegetables. It is extremely safe for the natural enemies of spider
mites and useful insects such as honey bees. In South Korea, it is used for fruits and vegetables, and in South America it is used for flowers.

GREATAM®, PULSOR®

®

These products contain a fungicide that we acquired from Dow AgroSciences in 2010. We market GREATAM® for the
sheath blight disease that affects paddy rice and IKARUGA® for large patch disease of lawn. We export and sell thisproduct in overseas markets including China, South Korea, India and Brazil under the trade name of PULSOR®.

ALTAIR , an active ingredient in herbicides for paddy rice, is a wide-spectrum herbicide that is highly
effective in eliminating bulrush and cyperaceous perennial weeds. It is also effective for weeds thatare resistant to conventional sulfonylurea-based herbicides. We market this product in Japan, South
Korea and China.
®

■ Active Ingredient for Veterinary Pharmaceuticals▲ALTAIR®

ROUNDUP® MAXLOAD, ROUNDUP® MAXLOAD AL・AL Ⅱ・AL Ⅲ

Fluralaner
A compound that we invented in-house, Fluralaner is one of the ingredients contained in BRAVECTO® (veterinary pharmaceuticals), developed by
MSD Animal Health. We manufacture Fluralaner and then supply it to MSD Animal Health for use in as active ingredient for veterinary pharmaceuticals.

In 2002, we acquired the exclusive marketing rights to this product in Japan
from Monsanto. While this herbicide kills most weeds, it has low toxicity tohumans and animals and does not remain in the soil or in the environment. In
addition to agricultural land, in 2011 we developed a shower-type “AL” that canbe used as a household product. In 2016, we added a fast-acting “AL Ⅱ” and in
2018, we launched “AL Ⅲ” that is both fast-acting and persistent to address
customer needs.

▲BRAVECTO®

T O P I C S

Establishing Nissan Agro Tech India PVT. LTD.
India is world’s sixth largest and one of the fastest growing agrochemical markets. Taking account of the market situation, we established a local
subsidiary in July 2017 to strengthen sales, marketing, and R&D. We support sales promotion and development of our products with six people.
▲ROUNDUP® MAXLOAD AL・ALⅡ・AL Ⅲ

29

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Business Overview

Agricultural Chemicals
Provide a stable supply of food to people around the world. Provide agrochemicals that are environmentally friendly. This is what we aim to do.
We have integrated system from exploratory, research, development to manufacture and sales of new agricultural agents for mainstay
crops around the world as well as those in Japan. We also develop agents in collaborative efforts, and actively acquire agents from othercompanies. We constantly work to expand our product lineup and sell our products in Japan and other countries.

SIRIUS®
To meet the needs of farmers, we develop and sell a large number of one-shot herbicides for paddy rice. The main component of these herbicides
is SIRIUS®, our proprietary active ingredient. We have been marketing these products in more than 20 countries for over 20 years.

TARGA®

Agrochemicals

This herbicide controls gramineous weeds that affect broadleaf crops such as soy beans, rapeseed, beets, cotton and sunflowers. It is used in morethan 40 countries, including India and countries in the United States and Europe.

We develop, manufacture, and sell herbicides, insecticides, fungicides, and other products used for the management of agricultural land and green land.

PERMIT®

Veterinary Pharmaceuticals

This product has effect against cyperaceous weeds extremely. We market this product in Japan under the trade names of HICUT®, which is a herbicide
for paddy rice in the mid to late term that is highly effective against the pesky weed Eleocharis kuroguwai, and INPOOL®, for lawns. We also market it
as PERMIT® in more than 20 overseas countries as an herbicide for paddy rice, corn fields, sugar cane fields and lawns.

We develop and manufacture active pharmaceutical ingredients used in ectoparasiticides for companion animals.

■ Insecticide

Business Results and Outlook
Sales (left axis)(billion yen)
70
60

45.7

50

Operating income (right axis)

47.5

40

52.0

58.1
16.4

13.2

30

9.2

20

63.0
17.7

(billion yen)
20

15

10

10.8

STARMITE®

5In FY2017, shipment of Fluralaner expanded and sales of
ALTAIR® was strong. ROUNDUP® MAXLOAD contributed tohigher revenues by launching new product ROUNDUP®
MAXLOAD AL Ⅲ that is more effective and persistent in
weeding than conventional products. In addition, shipmentsof agrochemicals to overseas markets were strong.

10
0

2014

2015

2016

2017

SANMITE®
This insecticide / acaricide is effective against spider mites and rust mites in fruit trees, as well as spider
mites and whiteflies in vegetables. We also market this product in about 30 overseas countries.

▲STARMITE®

▲LEIMAY®

■ Fungicide
LEIMAY®, ORACLE®

02018 (Outlook) (FY)

These fungicides have specific activity for diseases caused by oomycetes and myxomycetes. We sell LEIMAY®, which is used as an
atomizing agent for potatoes, grapes and vegetables, and ORACLE®, which is used for preventing and eliminating the root-knot diseaseof cruciferous vegetables and soil-borne diseases of potatoes, rice, vegetables and lawns. BESGREEN® meanwhile is designed toprevent diseases in lawns, and is sold in domestic and more than 20 overseas countries including Europe, South Korea and China.

Main Products■ Herbicide
ALTAIR

This acaricide prevents and eliminates spider mites from fruits, tea and vegetables. It is extremely safe for the natural enemies of spider
mites and useful insects such as honey bees. In South Korea, it is used for fruits and vegetables, and in South America it is used for flowers.

GREATAM®, PULSOR®

®

These products contain a fungicide that we acquired from Dow AgroSciences in 2010. We market GREATAM® for the
sheath blight disease that affects paddy rice and IKARUGA® for large patch disease of lawn. We export and sell thisproduct in overseas markets including China, South Korea, India and Brazil under the trade name of PULSOR®.

ALTAIR , an active ingredient in herbicides for paddy rice, is a wide-spectrum herbicide that is highly
effective in eliminating bulrush and cyperaceous perennial weeds. It is also effective for weeds thatare resistant to conventional sulfonylurea-based herbicides. We market this product in Japan, South
Korea and China.
®

■ Active Ingredient for Veterinary Pharmaceuticals▲ALTAIR®

ROUNDUP® MAXLOAD, ROUNDUP® MAXLOAD AL・AL Ⅱ・AL Ⅲ

Fluralaner
A compound that we invented in-house, Fluralaner is one of the ingredients contained in BRAVECTO® (veterinary pharmaceuticals), developed by
MSD Animal Health. We manufacture Fluralaner and then supply it to MSD Animal Health for use in as active ingredient for veterinary pharmaceuticals.

In 2002, we acquired the exclusive marketing rights to this product in Japan
from Monsanto. While this herbicide kills most weeds, it has low toxicity tohumans and animals and does not remain in the soil or in the environment. In
addition to agricultural land, in 2011 we developed a shower-type “AL” that canbe used as a household product. In 2016, we added a fast-acting “AL Ⅱ” and in
2018, we launched “AL Ⅲ” that is both fast-acting and persistent to address
customer needs.

▲BRAVECTO®

T O P I C S

Establishing Nissan Agro Tech India PVT. LTD.
India is world’s sixth largest and one of the fastest growing agrochemical markets. Taking account of the market situation, we established a local
subsidiary in July 2017 to strengthen sales, marketing, and R&D. We support sales promotion and development of our products with six people.
▲ROUNDUP® MAXLOAD AL・ALⅡ・AL Ⅲ

29

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201830

Business Overview

Pharmaceuticals
We strive to develop better pharmaceuticals by making use of our cultivated technologies. Our products help preserve precious lives and deliver
smiles to people around the world.

Drug Discovery
We first entered pharmaceutical business in 1982. Since then, we have continued to deal with challenges in the R&D of innovative new drugs, making
full use of our strategically developed chemical compound library, our cutting-edge evaluation functions, and our fine organic synthesis technologies.

Finetech®
This business provides total support to customers for their R&D of active pharmaceutical ingredients (API). Specifically, we engage in thecontracted development of manufacturing process in each one of the stages from pre-clinical to commercial production, as well as thecontracted manufacture of API and intermediates in compliance with GMP.

A Unique Business Model that Specializes in New Drug Discovery and the Manufacture of API without a Sales ForceBusiness Model
Before Launch
NissanChemical

Major
PharmaNissanChemicalClinical trial

API production

Sales milestone
Royalty

Major
PharmaSales

API shipment
Formulation
MarketingSales (left axis)

Operating income (right axis)

8.8

8.7

7.5

8.0

7.5

7.2

5

0

5.0
2.5

2.3

2.0

1.7

2014

2015

2016

This is a dual type Calcium antagonist that blocks not only L-type calcium channels, but also T-type channels. This agent has shown to have a positiveeffect on hypertension and angina pectoris. In addition, the agent is expected to provide a renal-protective and cardio-protective benefits. LANDEL® isdistributed by Zeria Pharmaceutical Co., Ltd. and Shionogi & Co., Ltd. in Japan, and FINTE® is distributed by Green Cross Co. in South Korea.

Novel Agent under Development
This activates the thrombopoietin receptor, which is a hematopoietic factor. This isorally administrable drug and enables to accelerate platelet production. It has thepotential to be a drug for treating every kind of thrombocytopenia.

This is an orally administrable antiarrhythmic agent that inhibits theacetylcholine-activated potassium channel current (IKACh). NTC-801 is expected to
be used as an atrial selective agent for the treatment of atrial fibrillation because
IKACh channels are apparent in the atrium but not in the ventricle.

▲Compound library at Biological Research Laboratories

Finetech® Business
Manufacturing API and intermediates (from pre-clinical to commercial production stages, including manufacturing in compliance with GMP)
We manufacture API and intermediates by establishing manufacturing methods that can be scaled up.

1.2
2017

We establish production processes that can be scaled-up through quantitative
reaction analysis and confirming the stability data of every process. We suggest
cost-competitive synthesis routes by only disclosing the structural formula.

(billion yen)
10

15

10

Efonidipine hydrochloride (LANDEL®, FINTE®)

Process research (route scouting, optimization and scale-up)

Business Results and Outlook(billion yen)This is a statin agent that greatly reduces LDL cholesterol and causes fewer drug-interactions, offering the advantage of safety. This agent is recognized
as one of the “strong statins” in clinical practice, and it is distributed by Kowa Pharmaceutical Co. Ltd. in Japan. It has also been released in the UnitedStates, as well as Latin American, European, and Asian countries. There are plans to release it in other countries and territories in the future.

NTC-801 (anti-arrhythmic agent)

After Launch

License out
Drug discovery

Pitavastatin calcium (LIVALO®)

NIP-022 (thrombocytopenia treatment agent)Features of Our Business

Upfront payment
Development milestone

Main Products

1.502018 (Outlook) (FY)In FY2017, sales of API of LIVALO® to overseas markets
increased, but sales to domestic market decreased due to anincrease in sales of generics. On the other hand, Finetech®
posted strong sales.

Supplying API of generics
We develop and sell API capable of high levels of activity in small amounts, such as the prostaglandin(PG) class of ingredients and vitamin D3 (VD3), by making use of our cultivated technologies forhandling high active API and our column equipment capable of high levels of refinement.

▲Finetech® development plant

T O P I C S

Challenges in manufacturing API of constrained peptides
We invested 900 million yen in a third-party allocation of shares of PeptiStar Inc., which is aiming to establish a stable supply system for API of constrained
peptides. In the future, we will work with PeptiStar Inc., to accelerate R&D on new liquid-phase methods of constrained peptides in which are expected toreduce pharmaceutical manufacturing costs, and expand our contracted manufacturing and process researching services of pharmaceuticals.

31

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201832

Business Overview

Pharmaceuticals
We strive to develop better pharmaceuticals by making use of our cultivated technologies. Our products help preserve precious lives and deliver
smiles to people around the world.

Drug Discovery
We first entered pharmaceutical business in 1982. Since then, we have continued to deal with challenges in the R&D of innovative new drugs, making
full use of our strategically developed chemical compound library, our cutting-edge evaluation functions, and our fine organic synthesis technologies.

Finetech®
This business provides total support to customers for their R&D of active pharmaceutical ingredients (API). Specifically, we engage in thecontracted development of manufacturing process in each one of the stages from pre-clinical to commercial production, as well as thecontracted manufacture of API and intermediates in compliance with GMP.

A Unique Business Model that Specializes in New Drug Discovery and the Manufacture of API without a Sales ForceBusiness Model
Before Launch
NissanChemical

Major
PharmaNissanChemicalClinical trial

API production

Sales milestone
Royalty

Major
PharmaSales

API shipment
Formulation
MarketingSales (left axis)

Operating income (right axis)

8.8

8.7

7.5

8.0

7.5

7.2

5

0

5.0
2.5

2.3

2.0

1.7

2014

2015

2016

This is a dual type Calcium antagonist that blocks not only L-type calcium channels, but also T-type channels. This agent has shown to have a positiveeffect on hypertension and angina pectoris. In addition, the agent is expected to provide a renal-protective and cardio-protective benefits. LANDEL® isdistributed by Zeria Pharmaceutical Co., Ltd. and Shionogi & Co., Ltd. in Japan, and FINTE® is distributed by Green Cross Co. in South Korea.

Novel Agent under Development
This activates the thrombopoietin receptor, which is a hematopoietic factor. This isorally administrable drug and enables to accelerate platelet production. It has thepotential to be a drug for treating every kind of thrombocytopenia.

This is an orally administrable antiarrhythmic agent that inhibits theacetylcholine-activated potassium channel current (IKACh). NTC-801 is expected to
be used as an atrial selective agent for the treatment of atrial fibrillation because
IKACh channels are apparent in the atrium but not in the ventricle.

▲Compound library at Biological Research Laboratories

Finetech® Business
Manufacturing API and intermediates (from pre-clinical to commercial production stages, including manufacturing in compliance with GMP)
We manufacture API and intermediates by establishing manufacturing methods that can be scaled up.

1.2
2017

We establish production processes that can be scaled-up through quantitative
reaction analysis and confirming the stability data of every process. We suggest
cost-competitive synthesis routes by only disclosing the structural formula.

(billion yen)
10

15

10

Efonidipine hydrochloride (LANDEL®, FINTE®)

Process research (route scouting, optimization and scale-up)

Business Results and Outlook(billion yen)This is a statin agent that greatly reduces LDL cholesterol and causes fewer drug-interactions, offering the advantage of safety. This agent is recognized
as one of the “strong statins” in clinical practice, and it is distributed by Kowa Pharmaceutical Co. Ltd. in Japan. It has also been released in the UnitedStates, as well as Latin American, European, and Asian countries. There are plans to release it in other countries and territories in the future.

NTC-801 (anti-arrhythmic agent)

After Launch

License out
Drug discovery

Pitavastatin calcium (LIVALO®)

NIP-022 (thrombocytopenia treatment agent)Features of Our Business

Upfront payment
Development milestone

Main Products

1.502018 (Outlook) (FY)In FY2017, sales of API of LIVALO® to overseas markets
increased, but sales to domestic market decreased due to anincrease in sales of generics. On the other hand, Finetech®
posted strong sales.

Supplying API of generics
We develop and sell API capable of high levels of activity in small amounts, such as the prostaglandin(PG) class of ingredients and vitamin D3 (VD3), by making use of our cultivated technologies forhandling high active API and our column equipment capable of high levels of refinement.

▲Finetech® development plant

T O P I C S

Challenges in manufacturing API of constrained peptides
We invested 900 million yen in a third-party allocation of shares of PeptiStar Inc., which is aiming to establish a stable supply system for API of constrained
peptides. In the future, we will work with PeptiStar Inc., to accelerate R&D on new liquid-phase methods of constrained peptides in which are expected toreduce pharmaceutical manufacturing costs, and expand our contracted manufacturing and process researching services of pharmaceuticals.

31

Nissan Chemical Corporation Integrated Report 2018

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Business Overview

Chemicals
Main Products

The development of products focused on high-level customer needs is another important mission.

Melamine

Basic Chemicals
We provide products to meet a wide range of demands, focusing on melamine, sulfuric acid, nitric acid, ammonia and other industrial
chemicals. We also provide high purity chemicals for washing semiconductors.

Fine Chemicals
This business focuses on environmental chemicals such as TEPIC (a special epoxy compound for sealants), melamine cyanurate andPHOSMEL® (non-halogen flame retardants), phenylphosphonic acid (a surface modifier), and HI-LITE® (sterilizing agent and disinfectant).
®

New Products
To better meet customer needs, we are working to fully enhance our product lineup, which focuses on new grade TEPIC®.

Features of Our BusinessSupplying Derivatives that Use Ammonia as Main Raw Material
Urea

AdBlue®

High purity liquid ammonia/
High purity aqueous ammonia

Melamine

Nitric acid

Cyanuric acid

Ammonia

Natural gas

High purity nitric acidMelaminecyanurate
Onoda Plant

HI-LITE®

40

Sales (left axis)

34.3

34.8

34.9

38.0

30
20
10
0

(billion yen)

5

3.9

3.8

3.4

3.9

4
3
2

1.9
2014

1
2015

2016

▲Plywood

AdBlue® (High-grade urea solution)
This is a solution of urea in demineralized water used as an operating fluid in diesel-powered freight trucks topurify emissions. We have established and expanded our original supply system addressing customer needs.

This is our unique, highly branched and saturated fatty alcohols and acids product with a long
chain alkyl group consisting of carbon 16 to 20. It has been used for various esters,
lubricants, cosmetics, and ink modifiers.

▲LED

TEPIC®
This tris (2, 3-Epoxy propyl) isocyanurate is a special tri-functional epoxy compound consisting of a triazine
ring and three glycidyl groups. The triazine ring provides excellent outdoor durability due to its low UVabsorption, while the glycidyl groups provide outstanding heat resistance by densely cross-linking with resins.

Melamine cyanurate (MC)Operating income (right axis)

34.3

Our products used for semiconductors / LED require an extremely high level of purity. We provide
sulfuric acid, nitric acid, and ammonia to customers, who hold our products in high regard.

▲AdBlue® truck

Business Results and Outlook(billion yen)High purity chemicals

FINEOXOCOL®

TEPIC®

Chlorine

Production flow of ammonia series products at Toyama Plant
Procurement from outside (as of August 2018)

This is widely used as an adhesive agent for plywood, laminated sheets, molded products, resin
finish for fabric and paper, and paint. It is highly aesthetic and offers a substantial level of quality.

2017

02018 (Outlook) (FY)In FY2017, sales of melamine decreased and sales ofhigh-purity sulfuric acid increased in basic chemicals. In
fine chemicals, shipment of TEPIC® was strong, while salesof HI-LITE® decreased. Profit margins for the entire
business also declined due to higher fuel and feedstock
prices.

This is a compound of melamine and isocyanuric acid. We provide a high quality product by integratingproduction from raw materials. MC is highly nitrogen containing compound, which offers superb thermal
stability up to 300°C. It is used as a flame retardant or an auxiliary flame retardant for various engineering
plastics such as nylon resins. It also exhibits outstanding flame retardation when used with flame
retardants such as phosphorus systems or metal hydroxide, and has been added to various plastics.

HI-LITE®

▲HI-LITE® in use

Chlorinated isocyanulate is the main ingredient in this product, which is used for sterilization anddisinfection of swimming pools and water purification tanks, and thus contributing to public hygiene.

Nissan Reishi
Nissan Reishi is a safe Japanese-made health food created through the domestic processingof Reishi mushrooms grown in Japan.
▲Reishi33

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201834

Business Overview

Chemicals
Main Products

The development of products focused on high-level customer needs is another important mission.

Melamine

Basic Chemicals
We provide products to meet a wide range of demands, focusing on melamine, sulfuric acid, nitric acid, ammonia and other industrial
chemicals. We also provide high purity chemicals for washing semiconductors.

Fine Chemicals
This business focuses on environmental chemicals such as TEPIC (a special epoxy compound for sealants), melamine cyanurate andPHOSMEL® (non-halogen flame retardants), phenylphosphonic acid (a surface modifier), and HI-LITE® (sterilizing agent and disinfectant).
®

New Products
To better meet customer needs, we are working to fully enhance our product lineup, which focuses on new grade TEPIC®.

Features of Our BusinessSupplying Derivatives that Use Ammonia as Main Raw Material
Urea

AdBlue®

High purity liquid ammonia/
High purity aqueous ammonia

Melamine

Nitric acid

Cyanuric acid

Ammonia

Natural gas

High purity nitric acidMelaminecyanurate
Onoda Plant

HI-LITE®

40

Sales (left axis)

34.3

34.8

34.9

38.0

30
20
10
0

(billion yen)

5

3.9

3.8

3.4

3.9

4
3
2

1.9
2014

1
2015

2016

▲Plywood

AdBlue® (High-grade urea solution)
This is a solution of urea in demineralized water used as an operating fluid in diesel-powered freight trucks topurify emissions. We have established and expanded our original supply system addressing customer needs.

This is our unique, highly branched and saturated fatty alcohols and acids product with a long
chain alkyl group consisting of carbon 16 to 20. It has been used for various esters,
lubricants, cosmetics, and ink modifiers.

▲LED

TEPIC®
This tris (2, 3-Epoxy propyl) isocyanurate is a special tri-functional epoxy compound consisting of a triazine
ring and three glycidyl groups. The triazine ring provides excellent outdoor durability due to its low UVabsorption, while the glycidyl groups provide outstanding heat resistance by densely cross-linking with resins.

Melamine cyanurate (MC)Operating income (right axis)

34.3

Our products used for semiconductors / LED require an extremely high level of purity. We provide
sulfuric acid, nitric acid, and ammonia to customers, who hold our products in high regard.

▲AdBlue® truck

Business Results and Outlook(billion yen)High purity chemicals

FINEOXOCOL®

TEPIC®

Chlorine

Production flow of ammonia series products at Toyama Plant
Procurement from outside (as of August 2018)

This is widely used as an adhesive agent for plywood, laminated sheets, molded products, resin
finish for fabric and paper, and paint. It is highly aesthetic and offers a substantial level of quality.

2017

02018 (Outlook) (FY)In FY2017, sales of melamine decreased and sales ofhigh-purity sulfuric acid increased in basic chemicals. In
fine chemicals, shipment of TEPIC® was strong, while salesof HI-LITE® decreased. Profit margins for the entire
business also declined due to higher fuel and feedstock
prices.

This is a compound of melamine and isocyanuric acid. We provide a high quality product by integratingproduction from raw materials. MC is highly nitrogen containing compound, which offers superb thermal
stability up to 300°C. It is used as a flame retardant or an auxiliary flame retardant for various engineering
plastics such as nylon resins. It also exhibits outstanding flame retardation when used with flame
retardants such as phosphorus systems or metal hydroxide, and has been added to various plastics.

HI-LITE®

▲HI-LITE® in use

Chlorinated isocyanulate is the main ingredient in this product, which is used for sterilization anddisinfection of swimming pools and water purification tanks, and thus contributing to public hygiene.

Nissan Reishi
Nissan Reishi is a safe Japanese-made health food created through the domestic processingof Reishi mushrooms grown in Japan.
▲Reishi33

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201834

Business Overview

Advanced Materials & Planning
Tackling challenges in new fields with an “undaunted spirit”
Our mission is to create new materials and businesses that will be our pillars for future growth of performance materials and life sciences business.
We work on developing new materials that meet market needs by making full use of our core technologies, “Fine Organic Synthesis”, “Functional
Polymer Design”, “Ultrafine Particle Control”, “Biological Evaluation” and “Optical Control”. We also promote collaboration between industry, government,
and academia, such as alliances with distinguished companies and joint research with universities, to generate actual demand at an early stage.

Main and New Products

Environmental Harmony Materials
ECOPROMOTE® (crystal nucleating agent for polylactate)This forms a stable crystal nucleus during the polylactate molding process
to significantly increase the speed of crystallization. It produces fine, evencrystals, helping to improve the molding cycle and enhance the heat
resistance and transparency of molded products.

Life Science Materials▲Bioplastic products (illustration purposes only)

FCeM series®

Optical Materials

FCeM ® series are the base materials for three dimensional cell cultures andenable to prepare the cells efficiently and extensively. Preparation Kit cancultivate large amounts of iPS / ES cells by floating cultures of cells in three
dimensional state. Cellhesion® enables mass culture of these cells as a
scaffold for vaccines and antibody-producing cells and mesenchymal stem
cells.

SUNCONNECT®

▲Preparation Kit▲Cellhesion®

▲Optical printed circuit board (illustration purposes only)

NANOFIBERGEL®
This is an additive for cosmetics and topical agents that is friendly topeople and the environment, consisting of fatty acids and amino acids. It
can be used in most cosmetic items. By adding to the active ingredients,
the moisturizing effect and the permeation promotion effect are achieved.
In addition, this product is available to promote protection effect for hairand skin.

Battery Materials
Organic Thin-film Solar Cell Material▲Spray▲Shampooprevelex® (Material for preventing the adhesion of biomolecules)
Applicable from experiments and research to regenerative medicine,prevelex® is an ultra-thin film material with nanometer-level thickness
which allows the easy coating of objects of various shapes. It can becoated on PP, COP and PDMS that had been difficult to coat. We arepromoting the development of customers in the medical equipment
field by taking advantage of its characteristics to prevent the adhesionof biomaterials such as exosome, as well as cell adhesion and protein
adsorption.

Electron collection layer
Active layer(power generation layer)
Hole collection layer▲Consumables for pharmaceutical research

Positive electrode (ITO)▲Example for Organic Thin-film Solar Cell

FairCurrent®
FairCurrent® is undercoat material for lithium-ion batteries (LiB) containing
highly dispersed nanomaterial. The thin film of FairCurrent® coated on
current electrode enables LiB to improve energy density and life by
reduction of electric resistance and increasing adhesion to electrode, andapplicable for the automotive LiB.

AQUAJOINT® is a two-liquid, room temperature solidified, elastic hydrogel. By merely mixing thetwo aqueous solutions and allowing them to stand at room temperature, water-soluble components
form a three-dimensional network and gel. These aqueous solutions with additive can make moldand can be formulated as customer needs.
▲AQUAJOINT®

Nissan Chemical Corporation Integrated Report 2018

▲Foundation

Negative electrode (Al)We are developing the hole collection layer of organic thin-film solar cells.
The hole collection layer collects holes from excitons generated in theactive layer and then transports them to the cathode. At the same time,it blocks the inflow of electrons. It plays an important role in improving
power generation efficiency. We will accelerate market development by
taking advantage of the features of this material, such as the capability offorming highly flat thin film, preparation at the HOMO level, andcompatibility with various printing methods.

Light

AQUAJOINT®

35

This is liquid organic-inorganic hybrid resin materials that exhibit highthermal stability and near-infrared transparency. Suitable for imprinting
methods, photo lithography and other processes. It is used for opticalinterconnects for purposes such as optical waveguides and lenses for
optical connectors.

▲Electric vehicle

Nissan Chemical Corporation Integrated Report 201836

Business Overview

Advanced Materials & Planning
Tackling challenges in new fields with an “undaunted spirit”
Our mission is to create new materials and businesses that will be our pillars for future growth of performance materials and life sciences business.
We work on developing new materials that meet market needs by making full use of our core technologies, “Fine Organic Synthesis”, “Functional
Polymer Design”, “Ultrafine Particle Control”, “Biological Evaluation” and “Optical Control”. We also promote collaboration between industry, government,
and academia, such as alliances with distinguished companies and joint research with universities, to generate actual demand at an early stage.

Main and New Products

Environmental Harmony Materials
ECOPROMOTE® (crystal nucleating agent for polylactate)This forms a stable crystal nucleus during the polylactate molding process
to significantly increase the speed of crystallization. It produces fine, evencrystals, helping to improve the molding cycle and enhance the heat
resistance and transparency of molded products.

Life Science Materials▲Bioplastic products (illustration purposes only)

FCeM series®

Optical Materials

FCeM ® series are the base materials for three dimensional cell cultures andenable to prepare the cells efficiently and extensively. Preparation Kit cancultivate large amounts of iPS / ES cells by floating cultures of cells in three
dimensional state. Cellhesion® enables mass culture of these cells as a
scaffold for vaccines and antibody-producing cells and mesenchymal stem
cells.

SUNCONNECT®

▲Preparation Kit▲Cellhesion®

▲Optical printed circuit board (illustration purposes only)

NANOFIBERGEL®
This is an additive for cosmetics and topical agents that is friendly topeople and the environment, consisting of fatty acids and amino acids. It
can be used in most cosmetic items. By adding to the active ingredients,
the moisturizing effect and the permeation promotion effect are achieved.
In addition, this product is available to promote protection effect for hairand skin.

Battery Materials
Organic Thin-film Solar Cell Material▲Spray▲Shampooprevelex® (Material for preventing the adhesion of biomolecules)
Applicable from experiments and research to regenerative medicine,prevelex® is an ultra-thin film material with nanometer-level thickness
which allows the easy coating of objects of various shapes. It can becoated on PP, COP and PDMS that had been difficult to coat. We arepromoting the development of customers in the medical equipment
field by taking advantage of its characteristics to prevent the adhesionof biomaterials such as exosome, as well as cell adhesion and protein
adsorption.

Electron collection layer
Active layer(power generation layer)
Hole collection layer▲Consumables for pharmaceutical research

Positive electrode (ITO)▲Example for Organic Thin-film Solar Cell

FairCurrent®
FairCurrent® is undercoat material for lithium-ion batteries (LiB) containing
highly dispersed nanomaterial. The thin film of FairCurrent® coated on
current electrode enables LiB to improve energy density and life by
reduction of electric resistance and increasing adhesion to electrode, andapplicable for the automotive LiB.

AQUAJOINT® is a two-liquid, room temperature solidified, elastic hydrogel. By merely mixing thetwo aqueous solutions and allowing them to stand at room temperature, water-soluble components
form a three-dimensional network and gel. These aqueous solutions with additive can make moldand can be formulated as customer needs.
▲AQUAJOINT®

Nissan Chemical Corporation Integrated Report 2018

▲Foundation

Negative electrode (Al)We are developing the hole collection layer of organic thin-film solar cells.
The hole collection layer collects holes from excitons generated in theactive layer and then transports them to the cathode. At the same time,it blocks the inflow of electrons. It plays an important role in improving
power generation efficiency. We will accelerate market development by
taking advantage of the features of this material, such as the capability offorming highly flat thin film, preparation at the HOMO level, andcompatibility with various printing methods.

Light

AQUAJOINT®

35

This is liquid organic-inorganic hybrid resin materials that exhibit highthermal stability and near-infrared transparency. Suitable for imprinting
methods, photo lithography and other processes. It is used for opticalinterconnects for purposes such as optical waveguides and lenses for
optical connectors.

▲Electric vehicle

Nissan Chemical Corporation Integrated Report 201836

Business Overview

Research and Development
We strive to further refine the core technology we have cultivated throughout our long history, and develop new products, technologies, and businesses.

Chemical Research Laboratories

While we deepen our proprietary technologies, we also promote thecreation of new materials and introduction of new technologies throughindustry-government-academia collaborations. As part of these activities,
we are participating in a project of the Japan Agency for Medical
Research and Development (AMED), which was founded in April 2015,
and are working on the development of a cell manufacturing andprocessing system for the industrialization of regenerative medicine. We
are conducting joint development with Kyoto University, and havediscovered a technology that leads to the low-cost manufacturing of iPS
cells. We will continue to contribute to the development of regenerative
medicine while also proceeding with state-of-the-art research.
In addition, as an industry- academia collaboration, we have set up alaboratory in FiaS (Fukuoka Industry-Academia Symphonicity) since
September 2008 as a base for introducing materials seeds andcutting-edge technologies at Kyushu University.

Chemical Research Laboratories is Nissan Chemical’s core R&D site,
and is responsible for our corporate research. It researches and develops
agrochemicals and pharmaceuticals that utilize the fine organic synthesis
technology we have cultivated over the years, research on company-wide
processes, and material analysis research.

Major research contents- Discovery of agrochemicals and pharmaceuticals, and the development ofagrochemical formulations and active pharmaceutical ingredients- Development of new organic materials and polymer materials- Process development of new products and candidates- Material analysis and computational science that support research

Promotion of Industry-Government-Academia Collaborations▲Funabashi, Chiba

Materials Research Laboratories
Materials Research Laboratories creates highly unique new materials, allowing us to respond quickly to increasingly sophisticated and diverse
market needs. At the same time, the Laboratories focuses their efforts on researching next-generation materials in an effort to create new markets.

Major research contents- Material development based on technologies for the design, synthesis, and evaluation of functional polymers and composite materials- Development of new materials intended for new display technologies and semiconductor process technologies- Manufacturing research and the application development of materials such as inorganic particulates

iPS cells

Bone cells

OrgansNerve cells

Blood cells

Muscle cells▲Regenerative medicine (illustration purposes only)

T O P I C S

Since FY2017, we have been participating in projects in NARO (National
Agriculture and Food Research Organization), and are researchingefficient agrochemical manufacturing processes using flow reactors thatcan carry out chemical reactions in fluids.
▲Fukuoka Industry-Academia Symphonicity

R&D Expenses
We consider R&D is the source of growth, and have intensively invested our management resources in R&D.
Over the last five years, R&D expenses have totaled 78.3 billion yen. The percentage of our expenses in Performance Materials and Life
Sciences (Agricultural Chemicals and Pharmaceuticals) is accounting for 47% and 40% respectively.
▲Funabashi, Chiba▲Sodegaura, Chiba▲Toyama, Toyama

2017 0.6

Biological Research Laboratories
Biological Research Laboratories serves as a place for life science
research, such as evaluation research related to the usefulness and safetyof agrochemicals, pharmaceuticals and medical materials.

37

Nissan Chemical Corporation Integrated Report 20182016 0.5

7.92015 0.5

7.4

4.3

2.5

3.8

3.9

1.7

2.2

1.7

16.1

2.4

1.6

15.8

17.2

■ Chemicals■ Performance Materials

Major research contents- Efficacy tests, safety tests, and residue tests of agrochemicals in greenhouses and on farmland- Pharmacological tests, safety tests and pharmacokinetics tests of pharmaceuticals,
ranging from those on the gene level to those based on pathological models- Development of medical materials such as cell culture media, stem cell
amplifiers, and coating materials for medical equipment

8.1

2014 0.5

6.7

3.5

2.7

1.6

15.0

■ Pharmaceuticals

0.4
2013
▲Shiraoka, Saitama(FY) 0■ Agricultural Chemicals

6.3

3.5
5

2.9
10

1.1 14.2
15■ Others
20（billion yen）

Nissan Chemical Corporation Integrated Report 201838

Business Overview

Research and Development
We strive to further refine the core technology we have cultivated throughout our long history, and develop new products, technologies, and businesses.

Chemical Research Laboratories

While we deepen our proprietary technologies, we also promote thecreation of new materials and introduction of new technologies throughindustry-government-academia collaborations. As part of these activities,
we are participating in a project of the Japan Agency for Medical
Research and Development (AMED), which was founded in April 2015,
and are working on the development of a cell manufacturing andprocessing system for the industrialization of regenerative medicine. We
are conducting joint development with Kyoto University, and havediscovered a technology that leads to the low-cost manufacturing of iPS
cells. We will continue to contribute to the development of regenerative
medicine while also proceeding with state-of-the-art research.
In addition, as an industry- academia collaboration, we have set up alaboratory in FiaS (Fukuoka Industry-Academia Symphonicity) since
September 2008 as a base for introducing materials seeds andcutting-edge technologies at Kyushu University.

Chemical Research Laboratories is Nissan Chemical’s core R&D site,
and is responsible for our corporate research. It researches and develops
agrochemicals and pharmaceuticals that utilize the fine organic synthesis
technology we have cultivated over the years, research on company-wide
processes, and material analysis research.

Major research contents- Discovery of agrochemicals and pharmaceuticals, and the development ofagrochemical formulations and active pharmaceutical ingredients- Development of new organic materials and polymer materials- Process development of new products and candidates- Material analysis and computational science that support research

Promotion of Industry-Government-Academia Collaborations▲Funabashi, Chiba

Materials Research Laboratories
Materials Research Laboratories creates highly unique new materials, allowing us to respond quickly to increasingly sophisticated and diverse
market needs. At the same time, the Laboratories focuses their efforts on researching next-generation materials in an effort to create new markets.

Major research contents- Material development based on technologies for the design, synthesis, and evaluation of functional polymers and composite materials- Development of new materials intended for new display technologies and semiconductor process technologies- Manufacturing research and the application development of materials such as inorganic particulates

iPS cells

Bone cells

OrgansNerve cells

Blood cells

Muscle cells▲Regenerative medicine (illustration purposes only)

T O P I C S

Since FY2017, we have been participating in projects in NARO (National
Agriculture and Food Research Organization), and are researchingefficient agrochemical manufacturing processes using flow reactors thatcan carry out chemical reactions in fluids.
▲Fukuoka Industry-Academia Symphonicity

R&D Expenses
We consider R&D is the source of growth, and have intensively invested our management resources in R&D.
Over the last five years, R&D expenses have totaled 78.3 billion yen. The percentage of our expenses in Performance Materials and Life
Sciences (Agricultural Chemicals and Pharmaceuticals) is accounting for 47% and 40% respectively.
▲Funabashi, Chiba▲Sodegaura, Chiba▲Toyama, Toyama

2017 0.6

Biological Research Laboratories
Biological Research Laboratories serves as a place for life science
research, such as evaluation research related to the usefulness and safetyof agrochemicals, pharmaceuticals and medical materials.

37

Nissan Chemical Corporation Integrated Report 20182016 0.5

7.92015 0.5

7.4

4.3

2.5

3.8

3.9

1.7

2.2

1.7

16.1

2.4

1.6

15.8

17.2

■ Chemicals■ Performance Materials

Major research contents- Efficacy tests, safety tests, and residue tests of agrochemicals in greenhouses and on farmland- Pharmacological tests, safety tests and pharmacokinetics tests of pharmaceuticals,
ranging from those on the gene level to those based on pathological models- Development of medical materials such as cell culture media, stem cell
amplifiers, and coating materials for medical equipment

8.1

2014 0.5

6.7

3.5

2.7

1.6

15.0

■ Pharmaceuticals

0.4
2013
▲Shiraoka, Saitama(FY) 0■ Agricultural Chemicals

6.3

3.5
5

2.9
10

1.1 14.2
15■ Others
20（billion yen）

Nissan Chemical Corporation Integrated Report 201838

Corporate GovernanceCorporate GovernanceDirectors and Auditors
Directors

Representative Director, President & CEO

Director, Senior Executive Vice President

Outside Director

Outside Director

Kojiro Kinoshita

Junichi Miyazaki

Tisato Kajiyama

Tadashi Ohe

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 11/12

1977 Joined the Company
2002 Director, Head of Corporate Planning Department
2006 Managing Director
2008 Representative Director, President & CEO (to the present)

1974 Joined The Industrial Bank of Japan, Limited
2006 Joined the Company, Advisor(currently Mizuho Bank, Ltd.)
2006 Director
2000 General Manager of International Department of The Industrial 2007 Director, Head of Corporate Administration Department
Bank of Japan, Limited (currently Mizuho Bank, Ltd.)
2008 Managing Director
2011 Senior Managing Director
2003 Corporate Auditor of Mizuho Corporate Bank, Ltd.
(currently Mizuho Bank, Ltd.)2013 Director, Senior Executive Vice President (to the present)
2005 Managing Executive Officer of Kowa Real Estate Co., Ltd.
2005 Managing Director of Kowa Real Estate Co., Ltd.

1969 Post Doctor Course, The University of
Massachusetts Amherst, USA
1984 Professor of Faculty of Engineering at The Kyushu
University (currently National University Corporation
Kyushu University)
2001 President of The Kyushu University

2008 President of Independent Administrative Institution
Japan Student Services Organization2010 Outside Corporate Auditor of the Company
2011 Chairman, Board of Trustees and President of
Public University Corporation Fukuoka Women’s
University (to the present)2014 Outside Director of the Company (to the present)

1969 Qualified for attorney-at-law
1989 Instructor for the Legal Training andResearch Institute of Japan (court
representation in civil proceedings)
1994 Outside Corporate Auditor of Canon Inc.
(to the present)
2004 Outside Corporate Auditor of
Marui Group Co., Ltd. (to the present)

2006 Outside Corporate Auditor of Kao Corporation2011 Outside Director of JECO Co., Ltd.
(to the present)2015 Outside Director of the Company(to the present)

Auditors
Director, Senior Executive Vice President

1979 Joined the Company
2004 Director, Head of Electronic Materials
Research Laboratories
2011 Managing Director
2013 Senior Managing Director

Director, Managing Executive Officer

Outside Corporate Auditor

Hiroyoshi Fukuro

Katsuaki Miyaji

Yasuyuki Nakajima

Norihiro Suzuki

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

1979 Joined the Company
2008 General Manager of Semiconductor Materials Research Department, Electronic
Materials Research Laboratories
2008 Associate Executive Officer, General Manager of Semiconductor Materials Research
Department, Electronic Materials Research Laboratories
2010 Associate Executive Officer, General Manager of Semiconductor Materials Research
Department, Electronic Materials Division2015 Corporate Auditor of the Company (to the present)2012 Managing Director of The Norinchukin Bank
1983 Joined The Norinchukin Bank
2014 Director of Nochu Bussiness2003 General Manager of Naha Branch2008 General Manager of Cooperative
Support Co., Ltd., and Director of Nochu
Information System Co., Ltd.
Finance & Administration (Kanto Area) Div.
2010 Seconded to Eiraku Co., Ltd. as President 2016 Outside Corporate Auditor of the Company(to the present)(currently Norinchukin Facilities Co., Ltd.)

Outside Corporate Auditor

Outside Corporate Auditor

2014 Director, Senior Managing Executive Officer
2018 Director, Senior Executive Vice President (to the present)

1985 Joined the Company
2016 Managing Executive Officer, Head of Corporate2010 Director, Head of Chemical Research Laboratories
Planning Department
2011 Director, Head of Advanced Materials & Planning Department 2016 Director, Managing Executive Officer
2014 Executive Officer, Head of Electronic Materials Research(to the present)
Laboratories
2014 Executive Officer, Head of Materials Research Laboratories

Director, Managing Executive Officer

Director, Managing Executive Officer

Takashi Honda

Hitoshi Suzuki

Shuichi Takemoto

Noriyuki Katayama

Attendance at the Board Meeting 12/12（newly appointed）

Attendance at the Board Meeting 10/10
Attendance at the Board of Corporate Auditors’ Meeting 10/10

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

1982 Joined The Fuji Bank, Limited
2002 Deputy General Manager, IT & Systems Control
Department of Mizuho Bank, Ltd.
2004 General Manager, Human Resources Division ofMizuho Information & Research Institute, Inc.
2008 General Manager, Fukuoka Branch of Mizuho Bank, Ltd.
2009 General Manager, IT & Systems Planning
Department of Mizuho Trust & Banking Co., Ltd.
2010 Executive Officer, IT & Systems Planning
Department of Mizuho Trust & Banking Co., Ltd.

1990 Qualified for attorney-at-law, Joined the law
office of Nagashima & Ohno (currently
Nagashima Ohno & Tsunematsu)
1996 Qualified for attorney-at-law in New York State, USA
1996 Joined Tokyo City Law & Tax Partners
2003 Joined City-Yuwa Partners (to the present)
2004 Statutory Auditor of Deutsche Asset Management(Japan) Limited (to the present)
2005 Statutory Auditor (part-time) of Deutsche Securities
Junbi K.K. (currently Deutsche Securities Inc.)

1981 Joined the Company
2012 General Manager of Planning & Development Department, Agricultural Chemicals Division2014 Executive Officer, Deputy Head of Agricultural Chemicals Division, General Manager of Planning &Development Department, Agricultural Chemicals Division2017 Managing Executive Officer, Head of Agricultural Chemicals Division2017 Director, Managing Executive Officer (to the present)

39

Corporate Auditor

Nissan Chemical Corporation Integrated Report 20181985 Joined the Company
2007 General Manager of Semiconductor Materials
Department, Electronic Materials Division2010 General Manager of Semiconductor Materials Research
Department, Electronic Materials Research Laboratories
2012 General Manager of Semiconductor Materials
Department, Performance Materials Division2013 Deputy Head of Performance Materials Division2013 Director, Deputy Head of Performance Materials
Division
2014 Executive Officer, Deputy Head of Performance
Materials Division2016 Executive Officer, Head of Materials Research Laboratories
2018 Managing Executive Officer, Head of
Performance Materials Division2018 Director, Managing Executive Officer (to the present)

2011 Managing Executive Officer of Mizuho Trust &Banking Co., Ltd.
2013 Managing Executive Officer of Mizuho Trust &Banking Co., Ltd., and Managing Executive Officer ofMizuho Financial Group, Inc.
2014 Deputy President of Mizuho Private WealthManagement Co., Ltd.
2017 Advisor of Mizuho Trust & Banking Co., Ltd.
2017 Outside Corporate Auditor of the Company(to the present)

2006 Outside Director of Accordia Golf co., Ltd.
2009 Visiting Professor of Toyo University Law School2013 Supervisory Director of SIA REIT, Inc.
(currently One REIT, Inc.)
2014 Examiner for the preliminary bar examination2014 Outside Corporate Auditor of the Company (to the present)2017 Supervisory Director of HEIWA REAL ESTATE
REIT, Inc. (to the present)2018 Outside Director of Nippon Denkai, Ltd.
(to the present)

Nissan Chemical Corporation Integrated Report 201840

Corporate GovernanceCorporate GovernanceDirectors and Auditors
Directors

Representative Director, President & CEO

Director, Senior Executive Vice President

Outside Director

Outside Director

Kojiro Kinoshita

Junichi Miyazaki

Tisato Kajiyama

Tadashi Ohe

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 11/12

1977 Joined the Company
2002 Director, Head of Corporate Planning Department
2006 Managing Director
2008 Representative Director, President & CEO (to the present)

1974 Joined The Industrial Bank of Japan, Limited
2006 Joined the Company, Advisor(currently Mizuho Bank, Ltd.)
2006 Director
2000 General Manager of International Department of The Industrial 2007 Director, Head of Corporate Administration Department
Bank of Japan, Limited (currently Mizuho Bank, Ltd.)
2008 Managing Director
2011 Senior Managing Director
2003 Corporate Auditor of Mizuho Corporate Bank, Ltd.
(currently Mizuho Bank, Ltd.)2013 Director, Senior Executive Vice President (to the present)
2005 Managing Executive Officer of Kowa Real Estate Co., Ltd.
2005 Managing Director of Kowa Real Estate Co., Ltd.

1969 Post Doctor Course, The University of
Massachusetts Amherst, USA
1984 Professor of Faculty of Engineering at The Kyushu
University (currently National University Corporation
Kyushu University)
2001 President of The Kyushu University

2008 President of Independent Administrative Institution
Japan Student Services Organization2010 Outside Corporate Auditor of the Company
2011 Chairman, Board of Trustees and President of
Public University Corporation Fukuoka Women’s
University (to the present)2014 Outside Director of the Company (to the present)

1969 Qualified for attorney-at-law
1989 Instructor for the Legal Training andResearch Institute of Japan (court
representation in civil proceedings)
1994 Outside Corporate Auditor of Canon Inc.
(to the present)
2004 Outside Corporate Auditor of
Marui Group Co., Ltd. (to the present)

2006 Outside Corporate Auditor of Kao Corporation2011 Outside Director of JECO Co., Ltd.
(to the present)2015 Outside Director of the Company(to the present)

Auditors
Director, Senior Executive Vice President

1979 Joined the Company
2004 Director, Head of Electronic Materials
Research Laboratories
2011 Managing Director
2013 Senior Managing Director

Director, Managing Executive Officer

Outside Corporate Auditor

Hiroyoshi Fukuro

Katsuaki Miyaji

Yasuyuki Nakajima

Norihiro Suzuki

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

1979 Joined the Company
2008 General Manager of Semiconductor Materials Research Department, Electronic
Materials Research Laboratories
2008 Associate Executive Officer, General Manager of Semiconductor Materials Research
Department, Electronic Materials Research Laboratories
2010 Associate Executive Officer, General Manager of Semiconductor Materials Research
Department, Electronic Materials Division2015 Corporate Auditor of the Company (to the present)2012 Managing Director of The Norinchukin Bank
1983 Joined The Norinchukin Bank
2014 Director of Nochu Bussiness2003 General Manager of Naha Branch2008 General Manager of Cooperative
Support Co., Ltd., and Director of Nochu
Information System Co., Ltd.
Finance & Administration (Kanto Area) Div.
2010 Seconded to Eiraku Co., Ltd. as President 2016 Outside Corporate Auditor of the Company(to the present)(currently Norinchukin Facilities Co., Ltd.)

Outside Corporate Auditor

Outside Corporate Auditor

2014 Director, Senior Managing Executive Officer
2018 Director, Senior Executive Vice President (to the present)

1985 Joined the Company
2016 Managing Executive Officer, Head of Corporate2010 Director, Head of Chemical Research Laboratories
Planning Department
2011 Director, Head of Advanced Materials & Planning Department 2016 Director, Managing Executive Officer
2014 Executive Officer, Head of Electronic Materials Research(to the present)
Laboratories
2014 Executive Officer, Head of Materials Research Laboratories

Director, Managing Executive Officer

Director, Managing Executive Officer

Takashi Honda

Hitoshi Suzuki

Shuichi Takemoto

Noriyuki Katayama

Attendance at the Board Meeting 12/12（newly appointed）

Attendance at the Board Meeting 10/10
Attendance at the Board of Corporate Auditors’ Meeting 10/10

Attendance at the Board Meeting 12/12
Attendance at the Board of Corporate Auditors’ Meeting 12/12

1982 Joined The Fuji Bank, Limited
2002 Deputy General Manager, IT & Systems Control
Department of Mizuho Bank, Ltd.
2004 General Manager, Human Resources Division ofMizuho Information & Research Institute, Inc.
2008 General Manager, Fukuoka Branch of Mizuho Bank, Ltd.
2009 General Manager, IT & Systems Planning
Department of Mizuho Trust & Banking Co., Ltd.
2010 Executive Officer, IT & Systems Planning
Department of Mizuho Trust & Banking Co., Ltd.

1990 Qualified for attorney-at-law, Joined the law
office of Nagashima & Ohno (currently
Nagashima Ohno & Tsunematsu)
1996 Qualified for attorney-at-law in New York State, USA
1996 Joined Tokyo City Law & Tax Partners
2003 Joined City-Yuwa Partners (to the present)
2004 Statutory Auditor of Deutsche Asset Management(Japan) Limited (to the present)
2005 Statutory Auditor (part-time) of Deutsche Securities
Junbi K.K. (currently Deutsche Securities Inc.)

1981 Joined the Company
2012 General Manager of Planning & Development Department, Agricultural Chemicals Division2014 Executive Officer, Deputy Head of Agricultural Chemicals Division, General Manager of Planning &Development Department, Agricultural Chemicals Division2017 Managing Executive Officer, Head of Agricultural Chemicals Division2017 Director, Managing Executive Officer (to the present)

39

Corporate Auditor

Nissan Chemical Corporation Integrated Report 20181985 Joined the Company
2007 General Manager of Semiconductor Materials
Department, Electronic Materials Division2010 General Manager of Semiconductor Materials Research
Department, Electronic Materials Research Laboratories
2012 General Manager of Semiconductor Materials
Department, Performance Materials Division2013 Deputy Head of Performance Materials Division2013 Director, Deputy Head of Performance Materials
Division
2014 Executive Officer, Deputy Head of Performance
Materials Division2016 Executive Officer, Head of Materials Research Laboratories
2018 Managing Executive Officer, Head of
Performance Materials Division2018 Director, Managing Executive Officer (to the present)

2011 Managing Executive Officer of Mizuho Trust &Banking Co., Ltd.
2013 Managing Executive Officer of Mizuho Trust &Banking Co., Ltd., and Managing Executive Officer ofMizuho Financial Group, Inc.
2014 Deputy President of Mizuho Private WealthManagement Co., Ltd.
2017 Advisor of Mizuho Trust & Banking Co., Ltd.
2017 Outside Corporate Auditor of the Company(to the present)

2006 Outside Director of Accordia Golf co., Ltd.
2009 Visiting Professor of Toyo University Law School2013 Supervisory Director of SIA REIT, Inc.
(currently One REIT, Inc.)
2014 Examiner for the preliminary bar examination2014 Outside Corporate Auditor of the Company (to the present)2017 Supervisory Director of HEIWA REAL ESTATE
REIT, Inc. (to the present)2018 Outside Director of Nippon Denkai, Ltd.
(to the present)

Nissan Chemical Corporation Integrated Report 201840

C o r porat e Govern a n c e

Basic Philosophy
We think of corporate governance as a mechanism that ensures sound, efficient management to provide stakeholders with sustainable, medium- tolong-term profits. Based on this idea, we strive to ensure management decisions are made promptly, and work to clarify the management responsibility
and responsibility for executing operations. At the same time, we take initiatives for strengthening the management’s monitoring function, compliance,risk management, and internal control system under our Board of Directors and Board of Corporate Auditors, whose members include highly

Policy and Procedures in the Nomination of Officer Candidates
Decisions regarding the nomination of candidates for directors and corporate auditors are made at board meetings attended by outside directors and proposed at thegeneral shareholders’ meeting. In addition, nominations of corporate auditor candidates are approved by the Board of Corporate Auditors in advance.

Nominate Policy

independent outside officers.

Corporate Governance System
Execution and supervision of operations
By introducing a system with executive officers, we clarify the management’s functionof prompt decision-making and supervision and the function of executing operations,
thereby strengthening both. We also strive to improve management’s capabilities todevelop and execute our management strategies. In addition, we have set a
one-year term for each director and executive officer, thereby clarifying themanagement responsibility and the responsibility for executing operations.

Board Meeting
Our board meets monthly in principle, to resolve important management matters. It
also supervises the execution of operations by directors and executive officers. We
ensure that important management matters are determined through careful
deliberations at the board meetings or management meetings in our efforts toeliminate or reduce business risks. In addition, the details of decisions made at the
management meetings and the results of business executions based on decisions
made at the board meetings, etc. are reported to the Board of Directors to enhance
the supervising function of the board meeting. The Company further strives to ensure
and improve effectiveness in execution of roles and responsibilities of the Board of
Directors by conducting the effectiveness evaluation on the overall Board of Directors
every fiscal year.

Internal Audit
We have the Internal Audit Department, which conducts fair and independent internal
audits in accordance with the “Nissan Chemical Group Internal Audit Rules”. Businessactivities are checked by the Finance & Accounting, Legal, Intellectual Property, andEnvironment, Safety & Quality Assurance Departments, with each applying its
respective expertise.

Audit by Corporate Auditors
We have established the Board of Corporate Auditors. In accordance with auditing
plans formulated by the Board of Corporate Auditors, corporate auditors audit theexecution of directors’ operation by participating in the board meetings and otherimportant meetings, and by regularly visiting each division / department of the Head
Office and plant / laboratory to exchange opinions.

Number stipulated in the Current Number of outside officers
Articles of Incorporation number included in the figure on the left

PolicyWe operate business activities globally in diverse fields, including chemicals, performance materials, agricultural chemicals, andpharmaceuticals. Accordingly, in nominating candidates for our directors, we consider the balance between knowledge,
experience, capabilities, and other elements of the overall board of directors and its diversity to ensure that our directors can makedecisions regarding the above business activities and supervise the execution of operations in an appropriate and flexible manner.
<Inside Directors>
Human resources who have expertise, knowledge and other capacities in each business field such as
corporate planning, personnel, finance & accounting, research and development, production technology,
environment, safety & quality assurance and others.
<Outside Directors>
Human resources who are capable of giving opinions proactively, raising questions and giving advice on growth strategies,
the enhancement of governance and other issues from the viewpoints of various stakeholders and society.

12

8

2 2）
（

Corporate Human resources with experience and knowledge in a wide range of fields including finance & accounting who are capable of giving
Auditors opinions and advice to the management from a fair and neutral standpoint, in addition to auditing the execution of operations.

5

4

3 1）
（

General Shareholders’ Meeting

Accounting Auditors

ReportBoard of Directors

Audit

Board of Corporate
Auditors

Directors

Audit(Business execution framework)

CSR Committee

President and CEO

ReportManagement
Meeting

Risk Management &Compliance Committee

Each division &department

Environment, Safety &Quality Assurance Committee

Group companies

Cooperate

Internal Audit
Department

Audit

The figure in ( ) indicates the number of directors / corporate auditors designated as independent officers

Appointment of Outside Officer

Audit

Accounting Audit
We have appointed the Yaesu Audit Company as our accounting auditor. They audit
at the end of each fiscal year, and during the fiscal year as necessary.

OutsideDirectors

Support for Outside Directors and Corporate Auditors
The Corporate Planning Department supports outside directors by giving them priorexplanations of the contents of the agenda and other matters to be discussed at theboard meetings, and serves as a contact for inquiries. For outside corporate
auditors, we have appointed audit assistants in response to requests from them.
Audit assistants are employees who help outside corporate auditors fulfill theirduties efficiently and smoothly. They serve as coordinators for holding internal
audits, Board of Corporate Auditors’ meetings, and other meetings, help outside
corporate auditors conduct audits, and collect and provide information to them.

OutsideCorporate
AuditorsName

Reason for appointment

Tisato Kajiyama
Appointed in June
2014

Dr. Kajiyama has acquired as the President of Kyushu University, the President of the Independent Administrative Institution Japan Student Services Organizationand the President of Public University Corporation Fukuoka Women’s University. We believe that he has reflected his broad range of knowledge, experience andexpertise as a doctor of engineering in our corporate management with objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Tadashi Ohe
Appointed in June2015

We believe that Mr. Ohe has reflected his extensive experience, including his experience of outside director at several companies
and expertise as attorney-at-law in our corporate management with objective and neutral standing-point, and will continue to fulfill
the duties appropriately.

Norihiro Suzuki
Appointed in June
2016

Mr. Suzuki has a wide range of knowledge, including extensive experience and finance expertise those are cultivated throughmany years of business at financial institutions. We believe that he has reflected his knowledge in our corporate audit with
objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Shuichi Takemoto
Appointed in June
2017

Mr. Takemoto has a wide range of knowledge, including extensive experience and finance expertise those are cultivated throughmany years of business at financial institutions. We believe that he has reflected his knowledge in our corporate audit with
objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Noriyuki Katayama
Appointed in June
2014

Mr. Katayama has an extensive experience including the experience of outside director / auditor at several companies andexpertise as attorney-at-law. We believe that he has reflected his knowledge in our corporate audit and will continue to fulfill theduties appropriately.

Number of Major Meetings and Attendances (FY2017)
Board Meeting

41

Nissan Chemical Corporation Integrated Report 2018

12 times

Attendance of outside directors at board meetings

96％

Attendance of outside corporate auditors at board meetings

100％

Board of Corporate Auditors’ Meeting
Attendance of outside corporate auditors at board of auditors’ meetings

12 times
100％

Nissan Chemical Corporation Integrated Report 201842

C o r porat e Govern a n c e

Basic Philosophy
We think of corporate governance as a mechanism that ensures sound, efficient management to provide stakeholders with sustainable, medium- tolong-term profits. Based on this idea, we strive to ensure management decisions are made promptly, and work to clarify the management responsibility
and responsibility for executing operations. At the same time, we take initiatives for strengthening the management’s monitoring function, compliance,risk management, and internal control system under our Board of Directors and Board of Corporate Auditors, whose members include highly

Policy and Procedures in the Nomination of Officer Candidates
Decisions regarding the nomination of candidates for directors and corporate auditors are made at board meetings attended by outside directors and proposed at thegeneral shareholders’ meeting. In addition, nominations of corporate auditor candidates are approved by the Board of Corporate Auditors in advance.

Nominate Policy

independent outside officers.

Corporate Governance System
Execution and supervision of operations
By introducing a system with executive officers, we clarify the management’s functionof prompt decision-making and supervision and the function of executing operations,
thereby strengthening both. We also strive to improve management’s capabilities todevelop and execute our management strategies. In addition, we have set a
one-year term for each director and executive officer, thereby clarifying themanagement responsibility and the responsibility for executing operations.

Board Meeting
Our board meets monthly in principle, to resolve important management matters. It
also supervises the execution of operations by directors and executive officers. We
ensure that important management matters are determined through careful
deliberations at the board meetings or management meetings in our efforts toeliminate or reduce business risks. In addition, the details of decisions made at the
management meetings and the results of business executions based on decisions
made at the board meetings, etc. are reported to the Board of Directors to enhance
the supervising function of the board meeting. The Company further strives to ensure
and improve effectiveness in execution of roles and responsibilities of the Board of
Directors by conducting the effectiveness evaluation on the overall Board of Directors
every fiscal year.

Internal Audit
We have the Internal Audit Department, which conducts fair and independent internal
audits in accordance with the “Nissan Chemical Group Internal Audit Rules”. Businessactivities are checked by the Finance & Accounting, Legal, Intellectual Property, andEnvironment, Safety & Quality Assurance Departments, with each applying its
respective expertise.

Audit by Corporate Auditors
We have established the Board of Corporate Auditors. In accordance with auditing
plans formulated by the Board of Corporate Auditors, corporate auditors audit theexecution of directors’ operation by participating in the board meetings and otherimportant meetings, and by regularly visiting each division / department of the Head
Office and plant / laboratory to exchange opinions.

Number stipulated in the Current Number of outside officers
Articles of Incorporation number included in the figure on the left

PolicyWe operate business activities globally in diverse fields, including chemicals, performance materials, agricultural chemicals, andpharmaceuticals. Accordingly, in nominating candidates for our directors, we consider the balance between knowledge,
experience, capabilities, and other elements of the overall board of directors and its diversity to ensure that our directors can makedecisions regarding the above business activities and supervise the execution of operations in an appropriate and flexible manner.
<Inside Directors>
Human resources who have expertise, knowledge and other capacities in each business field such as
corporate planning, personnel, finance & accounting, research and development, production technology,
environment, safety & quality assurance and others.
<Outside Directors>
Human resources who are capable of giving opinions proactively, raising questions and giving advice on growth strategies,
the enhancement of governance and other issues from the viewpoints of various stakeholders and society.

12

8

2 2）
（

Corporate Human resources with experience and knowledge in a wide range of fields including finance & accounting who are capable of giving
Auditors opinions and advice to the management from a fair and neutral standpoint, in addition to auditing the execution of operations.

5

4

3 1）
（

General Shareholders’ Meeting

Accounting Auditors

ReportBoard of Directors

Audit

Board of Corporate
Auditors

Directors

Audit(Business execution framework)

CSR Committee

President and CEO

ReportManagement
Meeting

Risk Management &Compliance Committee

Each division &department

Environment, Safety &Quality Assurance Committee

Group companies

Cooperate

Internal Audit
Department

Audit

The figure in ( ) indicates the number of directors / corporate auditors designated as independent officers

Appointment of Outside Officer

Audit

Accounting Audit
We have appointed the Yaesu Audit Company as our accounting auditor. They audit
at the end of each fiscal year, and during the fiscal year as necessary.

OutsideDirectors

Support for Outside Directors and Corporate Auditors
The Corporate Planning Department supports outside directors by giving them priorexplanations of the contents of the agenda and other matters to be discussed at theboard meetings, and serves as a contact for inquiries. For outside corporate
auditors, we have appointed audit assistants in response to requests from them.
Audit assistants are employees who help outside corporate auditors fulfill theirduties efficiently and smoothly. They serve as coordinators for holding internal
audits, Board of Corporate Auditors’ meetings, and other meetings, help outside
corporate auditors conduct audits, and collect and provide information to them.

OutsideCorporate
AuditorsName

Reason for appointment

Tisato Kajiyama
Appointed in June
2014

Dr. Kajiyama has acquired as the President of Kyushu University, the President of the Independent Administrative Institution Japan Student Services Organizationand the President of Public University Corporation Fukuoka Women’s University. We believe that he has reflected his broad range of knowledge, experience andexpertise as a doctor of engineering in our corporate management with objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Tadashi Ohe
Appointed in June2015

We believe that Mr. Ohe has reflected his extensive experience, including his experience of outside director at several companies
and expertise as attorney-at-law in our corporate management with objective and neutral standing-point, and will continue to fulfill
the duties appropriately.

Norihiro Suzuki
Appointed in June
2016

Mr. Suzuki has a wide range of knowledge, including extensive experience and finance expertise those are cultivated throughmany years of business at financial institutions. We believe that he has reflected his knowledge in our corporate audit with
objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Shuichi Takemoto
Appointed in June
2017

Mr. Takemoto has a wide range of knowledge, including extensive experience and finance expertise those are cultivated throughmany years of business at financial institutions. We believe that he has reflected his knowledge in our corporate audit with
objective and neutral standing-point, and will continue to fulfill the duties appropriately.

Noriyuki Katayama
Appointed in June
2014

Mr. Katayama has an extensive experience including the experience of outside director / auditor at several companies andexpertise as attorney-at-law. We believe that he has reflected his knowledge in our corporate audit and will continue to fulfill theduties appropriately.

Number of Major Meetings and Attendances (FY2017)
Board Meeting

41

Nissan Chemical Corporation Integrated Report 2018

12 times

Attendance of outside directors at board meetings

96％

Attendance of outside corporate auditors at board meetings

100％

Board of Corporate Auditors’ Meeting
Attendance of outside corporate auditors at board of auditors’ meetings

12 times
100％

Nissan Chemical Corporation Integrated Report 201842

C o r porat e Govern a n c e

Promotion of CSR
Officers’ Remuneration

Our group considers that the corporate philosophy “We contribute to society in harmony with the environment, based on our excellent technologies,

The fundamental principle in officers’ remuneration is to maintain its system that is in line with management policy by ensuring that officers contribute to increasing operating performanceon a continual basis over the mid- to long-term and toward increasing the overall value of the group, thereby meeting shareholder expectations. At the same time, the basic policy is to set
remuneration at an appropriate level, taking into account such factors as the management environment, operating performance and consistency with the treatment of employees.
The remunerations of individual directors are determined at the board meeting attended by outside directors as well within the total amount determined by resolution of the generalshareholders’ meeting. The remunerations of individual corporate auditors are determined through discussions by corporate auditors.
OfficerNumber of officers

Remuneration (million yen)

Directors (excluding outside directors)

9321

Corporate Auditors (excluding outside corporate auditors)

1

27

Outside officers

6

80

Total

16

428

products and services.” is the basis of our business activities. We have established CSR & Public Relations Office under Corporate Planning
Department to enhance our CSR activity with the mission “to draw up CSR strategies in response to social trends, to raise awareness of CSR internally,
and to send relevant information”. CSR & Public Relations Office serves secretariat of CSR Committee to tackle global social issues more strategically.
This committee which is composed of managing executive officers responsible for divisions and departments, meets biannually to discuss CSR policy,
materiality, mid- and long-term plans and annual plans related to CSR, evaluation of the results of activities, and issues that need to be improved andexamined based on the evaluation. The results of the deliberations are approved by the management meeting and submitted to the board meeting.
In addition, we have participated in United Nations Global Compact (UNGC) in April 2018. We support 10 principles advocated by UNGC in four fields
in human rights, labor, the environment and anti-corruption and will continue to make efforts to realize them, thereby contributing to the sustainable
development of society.

(Note) The above number of officers and remuneration include remuneration for two directors and one corporate auditor who retired at the close of the 147th general shareholders' meeting held on
June 28, 2017.

Analysis and Evaluation of the Effectiveness of the Overall Board of Directors (Effectiveness Evaluation of Boards)

CSR Promotion Structure

We consider the primary roles and responsibilities of the Company’s Board of Directors as follows and annually analyze and evaluate whether the roles andresponsibilities are fulfilled. In order to ensure the neutrality and objectivity of the executioner of the effectiveness evaluation, evaluation is conducted every few years
by third-party that is not related to the Company and interests. Effectiveness evaluation in FY2017 was conducted with the cooperation of external organization.

Board Meeting
President and CEO

The Primary Roles and Responsibilities of the Board of Directors(1) Establishing a strategy for achieving sustainable growth and increasing the Company’s corporate value over the medium to long-term, and facilitating the execution of the foregoing

Management Meeting(2) Providing appropriate support for risk-taking by the management by developing an enhanced internal control system and other systems(3) Strengthening the swift management decision-making and oversight function and the execution function through clarification of both function(4) Further enhancing management transparency, soundness and objectivity through, among other efforts, appointment of Outside Officers who monitor andoversee the management from external viewpoints

Evaluation Procedures
The Company prepared a questionnaire for directors and corporate auditors and analyzed the results of their responses, and conducted individual interviews with all directors and corporate auditors. Basedon the results of these responses and interviews, all independent directors (two outside directors and one outside corporate auditor), the President, the Vice President, the Director and Head of the
Corporate Planning Department, and external organizations analyzed and evaluated at the meeting of exchange of ideas. The results of the meeting were discussed and summarized at the board meeting.

Evaluation Results
As a result of deliberations by the board meeting, it is concluded that the Board of Directors assured the effectiveness considering its structure, operation and appropriate content
to discuss. Implemented countermeasures against the results of effectiveness evaluation implemented in FY2016 were also taken into account. However, it is necessary toassess following items as future initiatives at the boards’ effectiveness evaluation later than 2018 and improve subsequently and take remedial action as necessary.

CSR Committee

Risk Management & Compliance Committee

Environment, Safety & Quality Assurance Committee

Chairman
Director responsible for Corporate
Strategy & Coordination

Chairman
Chief Risk Management Officer (CRO)

Chairman
Officer responsible for the Environment,
Safety & Quality Assurance Department

Secretariat Office
CSR & Public Relations Office,Corporate Planning Department

Secretariat Office
Risk Management & Compliance Office,Corporate Planning Department

Secretariat OfficeEnvironment, Safety &Quality Assurance Department

Managing executive officers
responsible for divisions & departments

Future Initiatives(1) Enhancing the involvement of outside directors in discussions for developing management plans(2) Having outside directors and auditors participate in discussions on the progress of management strategies and plans

Divisions and Departments(3) Further improving information materials used in the board meetings

Internal Audit Dept., business divisions, Research Planning Dept.,Intellectual Property Dept., Advanced Materials & Planning Dept.,
Purchasing Dept., Corporate Planning Dept., Personnel Dept.,
Finance & Accounting Dept., Production Technology Dept.,
Environment, Safety & Quality Assurance Dept.

(4) Sharing discussions at management meetings with outside directors and auditors(5) Composition of the Board of Directors that considers balance and diversity(6) Setting up a voluntary committee that explains and discusses successor plans including executive managers

43

Heads ofdivisions & departments
plants & laboratories
President of domestic
consolidated subsidiaries

Nissan Chemical Corporation Integrated Report 2018

Heads ofbusiness divisions
Advanced Materials &Planning Department
Purchasing Department
Corporate Planning Department
Personnel Department
Production Technology Department
Environment, Safety & Quality
Assurance Department
plants & laboratories

Nissan Chemical Corporation Integrated Report 201844

C o r porat e Govern a n c e

Promotion of CSR
Officers’ Remuneration

Our group considers that the corporate philosophy “We contribute to society in harmony with the environment, based on our excellent technologies,

The fundamental principle in officers’ remuneration is to maintain its system that is in line with management policy by ensuring that officers contribute to increasing operating performanceon a continual basis over the mid- to long-term and toward increasing the overall value of the group, thereby meeting shareholder expectations. At the same time, the basic policy is to set
remuneration at an appropriate level, taking into account such factors as the management environment, operating performance and consistency with the treatment of employees.
The remunerations of individual directors are determined at the board meeting attended by outside directors as well within the total amount determined by resolution of the generalshareholders’ meeting. The remunerations of individual corporate auditors are determined through discussions by corporate auditors.
OfficerNumber of officers

Remuneration (million yen)

Directors (excluding outside directors)

9321

Corporate Auditors (excluding outside corporate auditors)

1

27

Outside officers

6

80

Total

16

428

products and services.” is the basis of our business activities. We have established CSR & Public Relations Office under Corporate Planning
Department to enhance our CSR activity with the mission “to draw up CSR strategies in response to social trends, to raise awareness of CSR internally,
and to send relevant information”. CSR & Public Relations Office serves secretariat of CSR Committee to tackle global social issues more strategically.
This committee which is composed of managing executive officers responsible for divisions and departments, meets biannually to discuss CSR policy,
materiality, mid- and long-term plans and annual plans related to CSR, evaluation of the results of activities, and issues that need to be improved andexamined based on the evaluation. The results of the deliberations are approved by the management meeting and submitted to the board meeting.
In addition, we have participated in United Nations Global Compact (UNGC) in April 2018. We support 10 principles advocated by UNGC in four fields
in human rights, labor, the environment and anti-corruption and will continue to make efforts to realize them, thereby contributing to the sustainable
development of society.

(Note) The above number of officers and remuneration include remuneration for two directors and one corporate auditor who retired at the close of the 147th general shareholders' meeting held on
June 28, 2017.

Analysis and Evaluation of the Effectiveness of the Overall Board of Directors (Effectiveness Evaluation of Boards)

CSR Promotion Structure

We consider the primary roles and responsibilities of the Company’s Board of Directors as follows and annually analyze and evaluate whether the roles andresponsibilities are fulfilled. In order to ensure the neutrality and objectivity of the executioner of the effectiveness evaluation, evaluation is conducted every few years
by third-party that is not related to the Company and interests. Effectiveness evaluation in FY2017 was conducted with the cooperation of external organization.

Board Meeting
President and CEO

The Primary Roles and Responsibilities of the Board of Directors(1) Establishing a strategy for achieving sustainable growth and increasing the Company’s corporate value over the medium to long-term, and facilitating the execution of the foregoing

Management Meeting(2) Providing appropriate support for risk-taking by the management by developing an enhanced internal control system and other systems(3) Strengthening the swift management decision-making and oversight function and the execution function through clarification of both function(4) Further enhancing management transparency, soundness and objectivity through, among other efforts, appointment of Outside Officers who monitor andoversee the management from external viewpoints

Evaluation Procedures
The Company prepared a questionnaire for directors and corporate auditors and analyzed the results of their responses, and conducted individual interviews with all directors and corporate auditors. Basedon the results of these responses and interviews, all independent directors (two outside directors and one outside corporate auditor), the President, the Vice President, the Director and Head of the
Corporate Planning Department, and external organizations analyzed and evaluated at the meeting of exchange of ideas. The results of the meeting were discussed and summarized at the board meeting.

Evaluation Results
As a result of deliberations by the board meeting, it is concluded that the Board of Directors assured the effectiveness considering its structure, operation and appropriate content
to discuss. Implemented countermeasures against the results of effectiveness evaluation implemented in FY2016 were also taken into account. However, it is necessary toassess following items as future initiatives at the boards’ effectiveness evaluation later than 2018 and improve subsequently and take remedial action as necessary.

CSR Committee

Risk Management & Compliance Committee

Environment, Safety & Quality Assurance Committee

Chairman
Director responsible for Corporate
Strategy & Coordination

Chairman
Chief Risk Management Officer (CRO)

Chairman
Officer responsible for the Environment,
Safety & Quality Assurance Department

Secretariat Office
CSR & Public Relations Office,Corporate Planning Department

Secretariat Office
Risk Management & Compliance Office,Corporate Planning Department

Secretariat OfficeEnvironment, Safety &Quality Assurance Department

Managing executive officers
responsible for divisions & departments

Future Initiatives(1) Enhancing the involvement of outside directors in discussions for developing management plans(2) Having outside directors and auditors participate in discussions on the progress of management strategies and plans

Divisions and Departments(3) Further improving information materials used in the board meetings

Internal Audit Dept., business divisions, Research Planning Dept.,Intellectual Property Dept., Advanced Materials & Planning Dept.,
Purchasing Dept., Corporate Planning Dept., Personnel Dept.,
Finance & Accounting Dept., Production Technology Dept.,
Environment, Safety & Quality Assurance Dept.

(4) Sharing discussions at management meetings with outside directors and auditors(5) Composition of the Board of Directors that considers balance and diversity(6) Setting up a voluntary committee that explains and discusses successor plans including executive managers

43

Heads ofdivisions & departments
plants & laboratories
President of domestic
consolidated subsidiaries

Nissan Chemical Corporation Integrated Report 2018

Heads ofbusiness divisions
Advanced Materials &Planning Department
Purchasing Department
Corporate Planning Department
Personnel Department
Production Technology Department
Environment, Safety & Quality
Assurance Department
plants & laboratories

Nissan Chemical Corporation Integrated Report 201844

C o r porat e Govern a n c eCompliance
Regarding compliance with legislation and social norms to be a prerequisite for our continued survival and development as a company, we have formulated compliance

Prohibition of bribery of foreign public officials

rules and compliance basic policy, and established the Risk Management & Compliance Committee and the Consultation Hotline (whistleblowing system).

It is prohibited to provide foreign public officials, etc. with money or any other favors to gain illegal profits in the course of business or in return for favors

In addition, the Risk Management & Compliance Office under the Corporate Planning Department has been established as a specialized

provided by them in business, either directly or via a third party such as a consultant. It is also prohibited to promise or offer to provide such favors.

organization to promote continuous improvement of the entire compliance activities of Nissan Chemical Group. This office provides education andguidance on compliance, receives reports from the heads of each division / department, plant / laboratory, and group company, and conducts
regular audits of the status of compliance. The office makes recommendations for improvement as necessary.

Measures for Promoting Compliance (FY2017)

We have formulated the Compliance Manual, which sets forth compliance assessment for group employees, and are working to earn a solid

Formulation of guideline for confidential information

Information Managementsocial evaluation as a good corporate citizen by matter even more day-to-day activities than before.

In-house training for revision of the “Act on the Protection of Personal Information”
In-house training for new employees

Insider Trading Regulations

Compliance Basic Policy
1. We consider compliance to be an important management issue and ensure thorough compliance in every aspect of its business activities, thereby establishing corporate ethics.
2. All officers and employees of Nissan Chemical Group shall be sufficiently aware of compliance and prevent the occurrence of a compliance violation.

Dissemination by in-house newsletter
In-house training for the “Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors”

Subcontracting Regulation

Internal audit

3. In the event that a compliance violation has occurred or is likely to occur, we take a prompt and appropriate response.

Improvement of contact (addition of outside corporate auditors)

Consultation Hotline

Compliance Manual Rules

Introduction of in-house leniency system
In-house training
Formulation of the “Anti-Corruption and Bribery Policy” at Nissan Chemical Product (Shanghai) Co., Ltd.

As a corporate citizen

As a public corporation

As a member of the workplace

Comply with the laws/regulations of the industry
Restrict contributions and political donations
Terminate any relationships with antisocial forces
Comply with antitrust laws
Conduct fair transactions with suppliers and comply withthe “Act against Delay in Payment of Subcontract
Proceeds, Etc. to Subcontractors”
Prevent unfair competition
Comply with laws and regulations related to security export control
Comply with laws and regulations related to import/export
Prohibit excessive entertainment and gifts
Prohibit bribery of foreign officials, etc.
Implement appropriate marketing and advertising

Disclose management information
Conduct appropriate accounting processing

Comply with work regulations
Respect human rights; prohibit discrimination
Prohibit sexual harassment
Protect privacy
Ensure the health and safety of the workplace
Prohibit political and religious activities

As a manufacturer
Ensure the safety of productsProtect the environment
Implement security and disaster prevention measures

As a stakeholder of the Company
Prohibit conflicts of interest
Use corporate assets appropriately
Prohibit insider trading

Dissemination by in-house newsletter

Anti-bribery

We have established compliance rules from various viewpoints, including anti-corruption.

In-house training for the “Foreign Exchange Law”

Security Export Control

Internal audit
Consolidated subsidiaries Compliance Officers Meeting
Training for group companies

OthersTraining for newly-appointed board members
Training for board members

etc.

As a person who handles work-related information
Manage confidential corporate information appropriately
Use information systems appropriately
Manage personal information appropriately
Protect intellectual property rights

Restrictions on acts of endowment and political donations(1) Political donations and donations to various organizations must be made by observing the relevant laws and regulations such as the “Public Offices Election
Act” and the “Political Funds Control Act”, and by following the proper methods.
(2) Prior approval must be obtained by following internal rules before donating money or making any other donation.

Consultation Hotline

We have Consultation Hotline to prevent compliance violation or resolve the problem early on. When an employee discovers a compliance violation or potential complianceviolation, he or she shall address the problem in normal operation in principle, through measures that include reporting the matter to their superior. However, if he or she thinks
it is difficult to address the problem promptly and effectively, they can use the Consultation Hotline.
The contact point for reporting shall be the Risk Management & Compliance Office, outside attorneys, or outside corporate auditors, and the means for reporting
may be selected by e-mail, mail, or telephone. Upon receipt of a report, the contents are reported to the corporate auditors. The Board of Directors periodically receives
reports from the Risk Management & Compliance Office on the status of the operation of the internal reporting system and supervises it.
Although it is possible to report anonymously, even if the name of the informant is indicated, we take care not to disadvantage the informant due to the use of the system.
In FY2017, there were no cases of whistleblowing. We inform employees of the system via our in-house newsletter.

(3) Sound and transparent relationships with politicians and the government must be created by refraining strictly from actions that may lead to themisunderstanding that we have cozy relationships with them, not to mention bribery, payoffs and illegal political donations.

Prohibition of excessive entertainment and gift-giving(1) Entertainment and gift-giving for public officials or quasi-public officials that contravene the regulations under the “National Public Service Ethics Act”, etc. are prohibited.
(2) Entertainment and gifts to business partners must be given within the bounds of common sense of the general public.

FY2013

FY2014FY2015FY2016FY2017

2

1

1

0

0

Consultation Hotline Reports (Number)(3) Response to entertainment or a gift offered by our client or business partner, etc. must not be made before consulting our superiors when the entertainmentor the gift is suspected to be beyond the bounds of common sense of the general public.

45

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201846

C o r porat e Govern a n c eCompliance
Regarding compliance with legislation and social norms to be a prerequisite for our continued survival and development as a company, we have formulated compliance

Prohibition of bribery of foreign public officials

rules and compliance basic policy, and established the Risk Management & Compliance Committee and the Consultation Hotline (whistleblowing system).

It is prohibited to provide foreign public officials, etc. with money or any other favors to gain illegal profits in the course of business or in return for favors

In addition, the Risk Management & Compliance Office under the Corporate Planning Department has been established as a specialized

provided by them in business, either directly or via a third party such as a consultant. It is also prohibited to promise or offer to provide such favors.

organization to promote continuous improvement of the entire compliance activities of Nissan Chemical Group. This office provides education andguidance on compliance, receives reports from the heads of each division / department, plant / laboratory, and group company, and conducts
regular audits of the status of compliance. The office makes recommendations for improvement as necessary.

Measures for Promoting Compliance (FY2017)

We have formulated the Compliance Manual, which sets forth compliance assessment for group employees, and are working to earn a solid

Formulation of guideline for confidential information

Information Managementsocial evaluation as a good corporate citizen by matter even more day-to-day activities than before.

In-house training for revision of the “Act on the Protection of Personal Information”
In-house training for new employees

Insider Trading Regulations

Compliance Basic Policy
1. We consider compliance to be an important management issue and ensure thorough compliance in every aspect of its business activities, thereby establishing corporate ethics.
2. All officers and employees of Nissan Chemical Group shall be sufficiently aware of compliance and prevent the occurrence of a compliance violation.

Dissemination by in-house newsletter
In-house training for the “Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors”

Subcontracting Regulation

Internal audit

3. In the event that a compliance violation has occurred or is likely to occur, we take a prompt and appropriate response.

Improvement of contact (addition of outside corporate auditors)

Consultation Hotline

Compliance Manual Rules

Introduction of in-house leniency system
In-house training
Formulation of the “Anti-Corruption and Bribery Policy” at Nissan Chemical Product (Shanghai) Co., Ltd.

As a corporate citizen

As a public corporation

As a member of the workplace

Comply with the laws/regulations of the industry
Restrict contributions and political donations
Terminate any relationships with antisocial forces
Comply with antitrust laws
Conduct fair transactions with suppliers and comply withthe “Act against Delay in Payment of Subcontract
Proceeds, Etc. to Subcontractors”
Prevent unfair competition
Comply with laws and regulations related to security export control
Comply with laws and regulations related to import/export
Prohibit excessive entertainment and gifts
Prohibit bribery of foreign officials, etc.
Implement appropriate marketing and advertising

Disclose management information
Conduct appropriate accounting processing

Comply with work regulations
Respect human rights; prohibit discrimination
Prohibit sexual harassment
Protect privacy
Ensure the health and safety of the workplace
Prohibit political and religious activities

As a manufacturer
Ensure the safety of productsProtect the environment
Implement security and disaster prevention measures

As a stakeholder of the Company
Prohibit conflicts of interest
Use corporate assets appropriately
Prohibit insider trading

Dissemination by in-house newsletter

Anti-bribery

We have established compliance rules from various viewpoints, including anti-corruption.

In-house training for the “Foreign Exchange Law”

Security Export Control

Internal audit
Consolidated subsidiaries Compliance Officers Meeting
Training for group companies

OthersTraining for newly-appointed board members
Training for board members

etc.

As a person who handles work-related information
Manage confidential corporate information appropriately
Use information systems appropriately
Manage personal information appropriately
Protect intellectual property rights

Restrictions on acts of endowment and political donations(1) Political donations and donations to various organizations must be made by observing the relevant laws and regulations such as the “Public Offices Election
Act” and the “Political Funds Control Act”, and by following the proper methods.
(2) Prior approval must be obtained by following internal rules before donating money or making any other donation.

Consultation Hotline

We have Consultation Hotline to prevent compliance violation or resolve the problem early on. When an employee discovers a compliance violation or potential complianceviolation, he or she shall address the problem in normal operation in principle, through measures that include reporting the matter to their superior. However, if he or she thinks
it is difficult to address the problem promptly and effectively, they can use the Consultation Hotline.
The contact point for reporting shall be the Risk Management & Compliance Office, outside attorneys, or outside corporate auditors, and the means for reporting
may be selected by e-mail, mail, or telephone. Upon receipt of a report, the contents are reported to the corporate auditors. The Board of Directors periodically receives
reports from the Risk Management & Compliance Office on the status of the operation of the internal reporting system and supervises it.
Although it is possible to report anonymously, even if the name of the informant is indicated, we take care not to disadvantage the informant due to the use of the system.
In FY2017, there were no cases of whistleblowing. We inform employees of the system via our in-house newsletter.

(3) Sound and transparent relationships with politicians and the government must be created by refraining strictly from actions that may lead to themisunderstanding that we have cozy relationships with them, not to mention bribery, payoffs and illegal political donations.

Prohibition of excessive entertainment and gift-giving(1) Entertainment and gift-giving for public officials or quasi-public officials that contravene the regulations under the “National Public Service Ethics Act”, etc. are prohibited.
(2) Entertainment and gifts to business partners must be given within the bounds of common sense of the general public.

FY2013

FY2014FY2015FY2016FY2017

2

1

1

0

0

Consultation Hotline Reports (Number)(3) Response to entertainment or a gift offered by our client or business partner, etc. must not be made before consulting our superiors when the entertainmentor the gift is suspected to be beyond the bounds of common sense of the general public.

45

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201846

C o r porat e Govern a n c e

Risk Management
Risk Management Basic Policy

Identified Group Major Risks

We are promoting risk management in accordance with the following action guidelines, with the aim of recognizing the various risks involved in the Nissan ChemicalGroup, preventing the occurrence of loss risk, minimizing the impact of their occurrence, and contributing to the achievement of our management strategic goals.

We clarified risks taking into account the business characteristics of each division and the surrounding businesses, including global political, economic and social
conditions. Subsequently, risk assessment was conducted from the viewpoint of probability and impact on the business. By following the assessment, risk map was
created and group major risks were identified. The contents of major risks were deliberated by the Risk Management & Compliance committee and agreed at the board
meeting.

1. We place top priority on the safety of the lives of officers and employees of the Nissan Chemical Group.
2. We consider risk management to be an important management issue, and engage in the activities from a company-wide perspective.
3. All officers and employees of the Group shall be sufficiently aware of risk management, strive to improve their abilities, and endeavor toprevent the occurrence of loss risk.

Risk Map (Excerpt)
Severe4. We promptly share the information on risk throughout the company.

Fire/ Explosion

5. We make efforts to respond promptly and accurately to the occurrence of loss risk and to minimize losses.

Risk Category

Earthquake/ Tsunami

Key Process Risk
Supportive Process Risk

1. Ensuring the Safety of Human Resources

3. Sound preservation of assets

2. Surviving as a company

4. Securing the credibility of stakeholders

5. Maximizing business opportunities and opportunities to makeachievements, and avoiding the loss of these opportunities
6. Ensuring compliance and pursuing efficiency, accuracy, andeffectiveness in the execution of business operations

Risk Management System

Impact on the business

Goals of risk management

The Risk Management & Compliance Office under the Corporate Planning Department has been established as a specialized organization to promote continuous
improvement in all of our risk management activities.
In addition, the Risk Management & Compliance Committee, which is held twice a year, has been established as an organization to enhance the effectiveness of risk
management, and to maintain and promote compliance.
The committee is chaired by the Chief Risk Management Officer (CRO), who is appointed at the board meeting, and is composed of the risk & compliance managers
of each division / department, plant / laboratory, and domestic consolidated subsidiary appointed by the CRO.
The risk & compliance managers periodically conduct risk identification and assessment, formulate countermeasure plans, conduct self-assessment for status of
implementation of the countermeasure plan and subject, formulate improvement plan, and systematically perform education and training at each division / department,
plant / laboratory and domestic consolidated subsidiary.
The important matters related to risk management and countermeasure plans, etc. are decided at the board meeting after discussion by the committee.

Quality Defect/ RecallFailure of Supplier
to Comply with ESG

Delay or Discontinuance ofProduct and Technology
Development

Infringing or Being
Infringed of Intellectual
Property Rights

Failure to Complete
Procedures for Cancellation orRegistration of License

Revision orStrengthening of
Law or Regulation

Typhoon/ Torrential Rain

Failure of the Business
Portfolio Strategy

Occupational
Accidents

Labor Dispute / Strike

Inadequate Response
to Customer

Cyber Attack

Rising Raw Material Price

Damage or Failure of
Facility and Machinery

Delay or Rejection ofApproval or
Register of Product

Violation of Human Rights(Sexual harassment andPower harassment)

Extreme Weather

Change in the
Surroundings ofBusiness Partners

Delay in Human
Resource Development

Insufficient Governance ofOverseas Subsidiary andBase

Fluctuations in Exchange

New Entrant/ Intensifying Competition

Risk Management & Compliance
Committee
CRO

Risk & Compliance Manager(Each division & department,
plant & laboratory anddomestic consolidated subsidiary)

CSR Committee
Environment, Safety &Quality Assurance Committee

Risk Management &Compliance Office,Corporate Planning Department(Secretariat Office)Report47

Nissan Chemical Corporation Integrated Report 2018

Difficulty in Procurement ofSpecific Raw Material

External Environmental Risk
Management Process Risk

ProbabilityGroup Major Risk
Board Meeting

Advent of Innovative
Technology

High

Summary of Risk

Delay or Discontinuance of Product and Technology Development

Risk of the failure of payback of invested capital to R&D due to being unable to launch the product under development

Advent of Innovative Technology

Risk of the losing competitive power due to advent of innovative technology with low cost

Failure of the Business Portfolio Strategy

Risk of decline in business performance due to the failure of the business portfolio strategy

Difficulty in Procurement of Specific Raw Material

Risk of being unable to supply the product to customer due to the discontinuance of specific raw material

Revision or Strengthening of Law or Regulation

Risk of unwilling discontinuance of sales of product, or unwilling change in business or capital investment plan due to revision / strengthening of law or regulation

Typhoon / Torrential Rain

Risk of increasing expenses to plant restoration and decreasing production volume due to direct onslaught on main plant by large-scale typhoon

Earthquake / Tsunami

Risk of suspension of business activities and the death or injury of many employees due to massive earthquake occurring at the location of business site

Fire / Explosion

Risk of suspension of business activities and the death or injury of many employees, and being sued by neighboring resident for the damage by fire / explosion at plant

Quality Defect / Recall

Risk of reimbursement for large expenses by customer and discontinuance of transactions due to PL accident which occurs with product containing material provided by the Company

Infringing or Being Infringed of Intellectual Property Rights

Risk of being subjected to a large amount of damages and product injunction claims from other company due to infringement on other company’s patent

Cyber Attack

Risk of shut down of operations for a long period of time, and losing credibility of customer and society because of leak of customer’s or the Company’s confidential information by cyber attack

Delay in Human Resource Development

Risk of personnel shortage which occurs in each division due to delay in the human resource development who will be responsible for the growth of the Company

Insufficient Governance of Overseas Subsidiary and Base

Risk of losing credibility due to discovery of impropriety management at overseas subsidiary and base caused by inadequate control

Nissan Chemical Corporation Integrated Report 201848

C o r porat e Govern a n c e

Risk Management
Risk Management Basic Policy

Identified Group Major Risks

We are promoting risk management in accordance with the following action guidelines, with the aim of recognizing the various risks involved in the Nissan ChemicalGroup, preventing the occurrence of loss risk, minimizing the impact of their occurrence, and contributing to the achievement of our management strategic goals.

We clarified risks taking into account the business characteristics of each division and the surrounding businesses, including global political, economic and social
conditions. Subsequently, risk assessment was conducted from the viewpoint of probability and impact on the business. By following the assessment, risk map was
created and group major risks were identified. The contents of major risks were deliberated by the Risk Management & Compliance committee and agreed at the board
meeting.

1. We place top priority on the safety of the lives of officers and employees of the Nissan Chemical Group.
2. We consider risk management to be an important management issue, and engage in the activities from a company-wide perspective.
3. All officers and employees of the Group shall be sufficiently aware of risk management, strive to improve their abilities, and endeavor toprevent the occurrence of loss risk.

Risk Map (Excerpt)
Severe4. We promptly share the information on risk throughout the company.

Fire/ Explosion

5. We make efforts to respond promptly and accurately to the occurrence of loss risk and to minimize losses.

Risk Category

Earthquake/ Tsunami

Key Process Risk
Supportive Process Risk

1. Ensuring the Safety of Human Resources

3. Sound preservation of assets

2. Surviving as a company

4. Securing the credibility of stakeholders

5. Maximizing business opportunities and opportunities to makeachievements, and avoiding the loss of these opportunities
6. Ensuring compliance and pursuing efficiency, accuracy, andeffectiveness in the execution of business operations

Risk Management System

Impact on the business

Goals of risk management

The Risk Management & Compliance Office under the Corporate Planning Department has been established as a specialized organization to promote continuous
improvement in all of our risk management activities.
In addition, the Risk Management & Compliance Committee, which is held twice a year, has been established as an organization to enhance the effectiveness of risk
management, and to maintain and promote compliance.
The committee is chaired by the Chief Risk Management Officer (CRO), who is appointed at the board meeting, and is composed of the risk & compliance managers
of each division / department, plant / laboratory, and domestic consolidated subsidiary appointed by the CRO.
The risk & compliance managers periodically conduct risk identification and assessment, formulate countermeasure plans, conduct self-assessment for status of
implementation of the countermeasure plan and subject, formulate improvement plan, and systematically perform education and training at each division / department,
plant / laboratory and domestic consolidated subsidiary.
The important matters related to risk management and countermeasure plans, etc. are decided at the board meeting after discussion by the committee.

Quality Defect/ RecallFailure of Supplier
to Comply with ESG

Delay or Discontinuance ofProduct and Technology
Development

Infringing or Being
Infringed of Intellectual
Property Rights

Failure to Complete
Procedures for Cancellation orRegistration of License

Revision orStrengthening of
Law or Regulation

Typhoon/ Torrential Rain

Failure of the Business
Portfolio Strategy

Occupational
Accidents

Labor Dispute / Strike

Inadequate Response
to Customer

Cyber Attack

Rising Raw Material Price

Damage or Failure of
Facility and Machinery

Delay or Rejection ofApproval or
Register of Product

Violation of Human Rights(Sexual harassment andPower harassment)

Extreme Weather

Change in the
Surroundings ofBusiness Partners

Delay in Human
Resource Development

Insufficient Governance ofOverseas Subsidiary andBase

Fluctuations in Exchange

New Entrant/ Intensifying Competition

Risk Management & Compliance
Committee
CRO

Risk & Compliance Manager(Each division & department,
plant & laboratory anddomestic consolidated subsidiary)

CSR Committee
Environment, Safety &Quality Assurance Committee

Risk Management &Compliance Office,Corporate Planning Department(Secretariat Office)Report47

Nissan Chemical Corporation Integrated Report 2018

Difficulty in Procurement ofSpecific Raw Material

External Environmental Risk
Management Process Risk

ProbabilityGroup Major Risk
Board Meeting

Advent of Innovative
Technology

High

Summary of Risk

Delay or Discontinuance of Product and Technology Development

Risk of the failure of payback of invested capital to R&D due to being unable to launch the product under development

Advent of Innovative Technology

Risk of the losing competitive power due to advent of innovative technology with low cost

Failure of the Business Portfolio Strategy

Risk of decline in business performance due to the failure of the business portfolio strategy

Difficulty in Procurement of Specific Raw Material

Risk of being unable to supply the product to customer due to the discontinuance of specific raw material

Revision or Strengthening of Law or Regulation

Risk of unwilling discontinuance of sales of product, or unwilling change in business or capital investment plan due to revision / strengthening of law or regulation

Typhoon / Torrential Rain

Risk of increasing expenses to plant restoration and decreasing production volume due to direct onslaught on main plant by large-scale typhoon

Earthquake / Tsunami

Risk of suspension of business activities and the death or injury of many employees due to massive earthquake occurring at the location of business site

Fire / Explosion

Risk of suspension of business activities and the death or injury of many employees, and being sued by neighboring resident for the damage by fire / explosion at plant

Quality Defect / Recall

Risk of reimbursement for large expenses by customer and discontinuance of transactions due to PL accident which occurs with product containing material provided by the Company

Infringing or Being Infringed of Intellectual Property Rights

Risk of being subjected to a large amount of damages and product injunction claims from other company due to infringement on other company’s patent

Cyber Attack

Risk of shut down of operations for a long period of time, and losing credibility of customer and society because of leak of customer’s or the Company’s confidential information by cyber attack

Delay in Human Resource Development

Risk of personnel shortage which occurs in each division due to delay in the human resource development who will be responsible for the growth of the Company

Insufficient Governance of Overseas Subsidiary and Base

Risk of losing credibility due to discovery of impropriety management at overseas subsidiary and base caused by inadequate control

Nissan Chemical Corporation Integrated Report 201848

Re s p o n s i b l e C ar e ( R C ) Activit ies

RC Management
Responsible Care activities aim to secure environment, health and safety (EHS) performance on voluntary basis throughout theentire process, from the development of chemical substances to manufacture, distribution, use, final consumption and disposal /recycling. These activities also serve as a form of communication with society through the announcement of their results. Chemicalcompanies in more than 60 countries and regions are working on RC activities. In Japan, the Japan Responsible Care Council wasestablished by the Japan Chemical Industry Association in 1995, and we are one of the original members of the association.

RC Basic Policy
We have set priority matters related to EHS in all stages of our business activities as our RC Basic Policy. We have fully shared this basic policy with all groupcompanies.
We revised the RC Basic Policy in April 2018, in accordance with the “Principles of the Japan Chemical Industry Association regarding the Environment, Healthand Safety” established on December 16, 2016.

We have also signed the Responsible Care Global Charter, which was revised in 2014. We are enhancing our efforts in RC
activities.

RC Basic Policy

Nissan Chemical RC Management System(1) Safeguard the environment, health and safety in domestic and overseas through strong leadership by management.

To achieve our RC mid-term plan, we have established RC management system based on ISO14001*, and we carry out targets management and continuous
improvements based on PDCA (Plan, Do, Check, Act).
We have established the Environment, Safety & Quality Assurance Committee, which is chaired by the officer responsible for the Environment, Safety & Quality
Assurance Department, as the organization in charge of promoting these activities. The committee holds annual meeting, at which its members discuss the resultsof activities at each laboratory / plant, review all the activities of the Company, and set the RC targets for the next fiscal year.
The results of the discussion are reported to management meeting. The targets of next fiscal year are resolved at the board meeting after deliberated andapproved by the management meeting.

(2) Strive to continually improve environmental, health and safety performance and the security of facilities, processes andtechnologies throughout the entire chemical lifecycle of our products from development to disposal, and disclose theresults of such efforts to the society.

* International standard for environmental management system. All of our plants have acquired ISO 14001 third party certification.

(6) Influence business partners to promote the safe management of chemicals within their own operations.

PLAN

Four Codes of RC

Corrective actions
Annual results report(4) Protect the environment and people’s health and safety by promoting continual improvement in chemical product safety
and stewardship throughout the supply chain.
(5) Strengthen chemicals management systems by participating in the activities related to development and implementationof lifecycle-oriented, science-based, and risk-based sound chemical management legislation and best practice.

Environment, Safety & Quality Assurance Committee(Report, annual plan development)

ACT(3) Further reduce consumption of resources and energy and strive to reduce, reuse and recycle waste.

Environmental Protection /Safety and Disaster Prevention /Occupational Safety and Health /Chemicals and Products Safety

Implementation in accordancewith annual plan

DO

CHECK
Internal audit(7) Endeavor to engage in dialogue with local authorities and communities by heeding their concerns regarding the effectsof our products and business activities on the environment, health and safety, and by providing them with necessary
information to help them understand properly.
(8) Further expand dialogue with our stakeholders in order to better meet their expectations regarding our efforts withrespect to the environment, health and safety.
(9) Contribute to the sustainable development of society by developing and providing innovative technologies and othersolutions.

RC Audits
RC audits are activities for checking RC activities at each plant, laboratory and affiliate. They are carried out by Environment, Safety & Quality Assurance
Department in accordance with the RC audit guidelines. In these audits, the auditors check whether RC activities, as well as internal audits and patrols, are carriedout appropriately and the PDCA cycle is implemented without fail, and compliance about EHS at each location. Environment, Safety & Quality Assurance
Department clarifies visible or potential problems related to EHS and promotes improvements in response after clarifying the problems, if any. In FY2017, total 43
audits were conducted.

▲ Environment, Safety & Quality Assurance Committee: Officer responsible for the Environment, Safety & Quality Assurance Department (Chairman),the head of Corporate Planning Department, Production Technology Department, Personnel Department, Purchasing Department, business divisions,
Advanced Materials & Planning Department, Environment, Safety & Quality Assurance Department, all plants and laboratories. Meeting is held annually.

49

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201850

Re s p o n s i b l e C ar e ( R C ) Activit ies

RC Management
Responsible Care activities aim to secure environment, health and safety (EHS) performance on voluntary basis throughout theentire process, from the development of chemical substances to manufacture, distribution, use, final consumption and disposal /recycling. These activities also serve as a form of communication with society through the announcement of their results. Chemicalcompanies in more than 60 countries and regions are working on RC activities. In Japan, the Japan Responsible Care Council wasestablished by the Japan Chemical Industry Association in 1995, and we are one of the original members of the association.

RC Basic Policy
We have set priority matters related to EHS in all stages of our business activities as our RC Basic Policy. We have fully shared this basic policy with all groupcompanies.
We revised the RC Basic Policy in April 2018, in accordance with the “Principles of the Japan Chemical Industry Association regarding the Environment, Healthand Safety” established on December 16, 2016.

We have also signed the Responsible Care Global Charter, which was revised in 2014. We are enhancing our efforts in RC
activities.

RC Basic Policy

Nissan Chemical RC Management System(1) Safeguard the environment, health and safety in domestic and overseas through strong leadership by management.

To achieve our RC mid-term plan, we have established RC management system based on ISO14001*, and we carry out targets management and continuous
improvements based on PDCA (Plan, Do, Check, Act).
We have established the Environment, Safety & Quality Assurance Committee, which is chaired by the officer responsible for the Environment, Safety & Quality
Assurance Department, as the organization in charge of promoting these activities. The committee holds annual meeting, at which its members discuss the resultsof activities at each laboratory / plant, review all the activities of the Company, and set the RC targets for the next fiscal year.
The results of the discussion are reported to management meeting. The targets of next fiscal year are resolved at the board meeting after deliberated andapproved by the management meeting.

(2) Strive to continually improve environmental, health and safety performance and the security of facilities, processes andtechnologies throughout the entire chemical lifecycle of our products from development to disposal, and disclose theresults of such efforts to the society.

* International standard for environmental management system. All of our plants have acquired ISO 14001 third party certification.

(6) Influence business partners to promote the safe management of chemicals within their own operations.

PLAN

Four Codes of RC

Corrective actions
Annual results report(4) Protect the environment and people’s health and safety by promoting continual improvement in chemical product safety
and stewardship throughout the supply chain.
(5) Strengthen chemicals management systems by participating in the activities related to development and implementationof lifecycle-oriented, science-based, and risk-based sound chemical management legislation and best practice.

Environment, Safety & Quality Assurance Committee(Report, annual plan development)

ACT(3) Further reduce consumption of resources and energy and strive to reduce, reuse and recycle waste.

Environmental Protection /Safety and Disaster Prevention /Occupational Safety and Health /Chemicals and Products Safety

Implementation in accordancewith annual plan

DO

CHECK
Internal audit(7) Endeavor to engage in dialogue with local authorities and communities by heeding their concerns regarding the effectsof our products and business activities on the environment, health and safety, and by providing them with necessary
information to help them understand properly.
(8) Further expand dialogue with our stakeholders in order to better meet their expectations regarding our efforts withrespect to the environment, health and safety.
(9) Contribute to the sustainable development of society by developing and providing innovative technologies and othersolutions.

RC Audits
RC audits are activities for checking RC activities at each plant, laboratory and affiliate. They are carried out by Environment, Safety & Quality Assurance
Department in accordance with the RC audit guidelines. In these audits, the auditors check whether RC activities, as well as internal audits and patrols, are carriedout appropriately and the PDCA cycle is implemented without fail, and compliance about EHS at each location. Environment, Safety & Quality Assurance
Department clarifies visible or potential problems related to EHS and promotes improvements in response after clarifying the problems, if any. In FY2017, total 43
audits were conducted.

▲ Environment, Safety & Quality Assurance Committee: Officer responsible for the Environment, Safety & Quality Assurance Department (Chairman),the head of Corporate Planning Department, Production Technology Department, Personnel Department, Purchasing Department, business divisions,
Advanced Materials & Planning Department, Environment, Safety & Quality Assurance Department, all plants and laboratories. Meeting is held annually.

49

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201850

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Promotion of the RC Mid-Term Plan (FY2016-2021)
Responsible
Care Code

Mid-term plan (FY2016-2021)
・Reducing greenhouse gas (GHG) emissions and improving the GHG
emission rate*1
GHG emissions: Reducing the total amount during the period of the
mid-term plan (FY2016 to 2021) by 100,000 tons compared to the periodof the previous mid-term plan (FY2010 to 2015) as CO2 equivalent
GHG emission rate: Improving by 20% from FY2011 level by FY2021

FY2017 plan

Achievement assessment

Reference

FY2018 plan

P55

・Reducing GHG emissions and further
improving the GHG emission rate
GHG emissions: Reducing by 20% from
FY2011 level by FY2021
GHG emission rate: Improving by 40% from
FY2011 level by FY2021

・Energy consumption rate was improved by 24%
from FY2011 level.

P56

・Further energy saving by improving the equipment
・Further reducing the energy consumption rate
capacities and renewal aging facilities
Achieving a 30% of reduction from the・Energy consumption rate: Improving by 25% from FY2011 level
FY2011 level by FY2021
・Relocating head office to a highly energy-saving-efficientbuilding (PAL / ERR Stage 3)

・Recycling rate was 97.9%.

P58

・Further reducing industrial waste
・Recycling rate: 99.5% or higher by FY2021

・Continuously conducting EHS audits
・Monitoring CSR activities in the supply chain

・EHS audits were conducted in major raw material suppliers.
・CSR assessments were conducted in major raw
material suppliers.

P67

・Expanding the coverage of EHS audits
・Establishing a CSR supply chain・Expanding the coverage of CSR assessment in the
management (green procurement) system
supply chain・Strengthening measures for biodiversity conservation

・Promoting activities for biodiversity based on
biodiversity action guidelines

・Management of Bio-Park・Support for a NPO and dialogue with them・Participation in “Fujimae-Higata Clean-up Activities”
・Continuous support for the conservation of Pinus
pentaphylla

P59・Strengthening measures for biodiversity
conservation

・Promoting activities for biodiversity based on
biodiversity action guidelines

・Promoting development and sales of environmentally friendly products

・Promoting development and study of environmentallyfriendly products

・Environmentally friendly product has been launched.
(Venus® Oilclean)

P25

・Promoting development and sales ofenvironmentally friendly products

・Promoting development and sales ofenvironmentally friendly products

・Zero accident of fire / explosion / leaking chemicals
・Reviewing and revising prior assessment guidelines☆☆☆

・There was no accident of fire / explosion / leaking chemicals.
・Prior assessment guideline was reviewed.
・Questionnaire about safety culture was revised.

P61

・Zero accident of fire / explosion / leaking chemicals ・Zero accident of fire / explosion / leaking chemicals
・Creating safety culture and improving the safety capabilities ・Revising prior assessment guideline
・Improving effectiveness of the prior assessment system ・Implementing the revised questionnaire about safety
culture and analysis
on manufacturing, construction work and research☆☆

・There was one case of an accident requiring staff time offfrom work. There were two cases of accidents involving
employees of subcontractors including temporary staff.
・Status of occupational safety and health was confirmed
and guidances were provided to subcontractors.

P62

・Revising the occupational safety and health ・Implementing the investment in in equipments andmanagement systemfacilities for safety (350 million yen / three years: final year)
・Achieving zero accident that requires staff
・Achieving zero accident that requires staff time offtime off from workfrom work☆☆☆

・Risk assessment was reviewed byprior assessment.
・Safety summary of AdBlue® was disclosed.
・Study of Whole Effluent Toxicity (WET) was launched.

P63

・Promoting risk-based management throughout the ・Continuously disclosing safety summaries ofchemical substances
lifecycle of chemical substances
・Contributing to advanced research that examines ・Continuously conducting the risk assessment by priorassessment system
the impact of chemical substances on human・Studying WET
health and the environment

・N2O emissions reduced by conversion of fuel for melamine
heating furnace and by downsizing nitric acid plants.
GHG emissions: Reducing by 53,000 tons from FY2016
as CO2 equivalent (by15% from FY2011 level)
GHG emission rate : Improving by 36% from FY2011 level

・Further reducing GHG emissions by conversion offuel for melamine heating furnace and others
・Reducing N2O emissions from nitric acid plants*1 Emissions / sales

・Improving the energy consumption rate*2
Achieving a 20% improvement from FY2011 level by FY2021*2 Amount of energy consumption / sales

Environmental
protection andcountermeasures ・Reducing industrial waste
to address climatechange・Establishing a CSR supply chain management (green procurement) system

・Creating safety culture and improving the safety capabilities
Safety and disaster Improving effectiveness of the prior assessment system on manufacturing,・
prevention
construction work and research

51

Revision of the mid-term plan(underline means revision)・Energy saving by improving the equipment capacities
and renewal aging facilities

・Target setting of the recycling rate

Occupationalsafety and health・Establishing an occupational safety and health management system
based on ISO45001
・Achieving zero accident that requires staff time off from work

・Implementing investment in equipments and facilities
for safety (350 million yen / three years)
・Reviewing the status and providing guidance on
occupational safety on subcontractors

Chemicals andproducts safety

・Promoting risk-based management throughout the lifecycle of chemical
substances
・Contributing to advanced research that examines the impact of chemical
substances on human health and the environment

・Reviewing the implementation of risk assessment
・Continuously disclosing safety summaries ofchemical substances

Nissan Chemical Corporation Integrated Report 2018☆☆☆

・Reducing GHG emissions by conversion of fuel forammonium auxiliary boiler・Suppressing Freon gas emissions by chiller renewal
・GHG emissions: Reducing by 16% from FY2011 level
GHG emission rate: Improving by 37% from FY2011 level

・Recycling rate: 98.5% or higher

Nissan Chemical Corporation Integrated Report 201852

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Promotion of the RC Mid-Term Plan (FY2016-2021)
Responsible
Care Code

Mid-term plan (FY2016-2021)
・Reducing greenhouse gas (GHG) emissions and improving the GHG
emission rate*1
GHG emissions: Reducing the total amount during the period of the
mid-term plan (FY2016 to 2021) by 100,000 tons compared to the periodof the previous mid-term plan (FY2010 to 2015) as CO2 equivalent
GHG emission rate: Improving by 20% from FY2011 level by FY2021

FY2017 plan

Achievement assessment

Reference

FY2018 plan

P55

・Reducing GHG emissions and further
improving the GHG emission rate
GHG emissions: Reducing by 20% from
FY2011 level by FY2021
GHG emission rate: Improving by 40% from
FY2011 level by FY2021

・Energy consumption rate was improved by 24%
from FY2011 level.

P56

・Further energy saving by improving the equipment
・Further reducing the energy consumption rate
capacities and renewal aging facilities
Achieving a 30% of reduction from the・Energy consumption rate: Improving by 25% from FY2011 level
FY2011 level by FY2021
・Relocating head office to a highly energy-saving-efficientbuilding (PAL / ERR Stage 3)

・Recycling rate was 97.9%.

P58

・Further reducing industrial waste
・Recycling rate: 99.5% or higher by FY2021

・Continuously conducting EHS audits
・Monitoring CSR activities in the supply chain

・EHS audits were conducted in major raw material suppliers.
・CSR assessments were conducted in major raw
material suppliers.

P67

・Expanding the coverage of EHS audits
・Establishing a CSR supply chain・Expanding the coverage of CSR assessment in the
management (green procurement) system
supply chain・Strengthening measures for biodiversity conservation

・Promoting activities for biodiversity based on
biodiversity action guidelines

・Management of Bio-Park・Support for a NPO and dialogue with them・Participation in “Fujimae-Higata Clean-up Activities”
・Continuous support for the conservation of Pinus
pentaphylla

P59・Strengthening measures for biodiversity
conservation

・Promoting activities for biodiversity based on
biodiversity action guidelines

・Promoting development and sales of environmentally friendly products

・Promoting development and study of environmentallyfriendly products

・Environmentally friendly product has been launched.
(Venus® Oilclean)

P25

・Promoting development and sales ofenvironmentally friendly products

・Promoting development and sales ofenvironmentally friendly products

・Zero accident of fire / explosion / leaking chemicals
・Reviewing and revising prior assessment guidelines☆☆☆

・There was no accident of fire / explosion / leaking chemicals.
・Prior assessment guideline was reviewed.
・Questionnaire about safety culture was revised.

P61

・Zero accident of fire / explosion / leaking chemicals ・Zero accident of fire / explosion / leaking chemicals
・Creating safety culture and improving the safety capabilities ・Revising prior assessment guideline
・Improving effectiveness of the prior assessment system ・Implementing the revised questionnaire about safety
culture and analysis
on manufacturing, construction work and research☆☆

・There was one case of an accident requiring staff time offfrom work. There were two cases of accidents involving
employees of subcontractors including temporary staff.
・Status of occupational safety and health was confirmed
and guidances were provided to subcontractors.

P62

・Revising the occupational safety and health ・Implementing the investment in in equipments andmanagement systemfacilities for safety (350 million yen / three years: final year)
・Achieving zero accident that requires staff
・Achieving zero accident that requires staff time offtime off from workfrom work☆☆☆

・Risk assessment was reviewed byprior assessment.
・Safety summary of AdBlue® was disclosed.
・Study of Whole Effluent Toxicity (WET) was launched.

P63

・Promoting risk-based management throughout the ・Continuously disclosing safety summaries ofchemical substances
lifecycle of chemical substances
・Contributing to advanced research that examines ・Continuously conducting the risk assessment by priorassessment system
the impact of chemical substances on human・Studying WET
health and the environment

・N2O emissions reduced by conversion of fuel for melamine
heating furnace and by downsizing nitric acid plants.
GHG emissions: Reducing by 53,000 tons from FY2016
as CO2 equivalent (by15% from FY2011 level)
GHG emission rate : Improving by 36% from FY2011 level

・Further reducing GHG emissions by conversion offuel for melamine heating furnace and others
・Reducing N2O emissions from nitric acid plants*1 Emissions / sales

・Improving the energy consumption rate*2
Achieving a 20% improvement from FY2011 level by FY2021*2 Amount of energy consumption / sales

Environmental
protection andcountermeasures ・Reducing industrial waste
to address climatechange・Establishing a CSR supply chain management (green procurement) system

・Creating safety culture and improving the safety capabilities
Safety and disaster Improving effectiveness of the prior assessment system on manufacturing,・
prevention
construction work and research

51

Revision of the mid-term plan(underline means revision)・Energy saving by improving the equipment capacities
and renewal aging facilities

・Target setting of the recycling rate

Occupationalsafety and health・Establishing an occupational safety and health management system
based on ISO45001
・Achieving zero accident that requires staff time off from work

・Implementing investment in equipments and facilities
for safety (350 million yen / three years)
・Reviewing the status and providing guidance on
occupational safety on subcontractors

Chemicals andproducts safety

・Promoting risk-based management throughout the lifecycle of chemical
substances
・Contributing to advanced research that examines the impact of chemical
substances on human health and the environment

・Reviewing the implementation of risk assessment
・Continuously disclosing safety summaries ofchemical substances

Nissan Chemical Corporation Integrated Report 2018☆☆☆

・Reducing GHG emissions by conversion of fuel forammonium auxiliary boiler・Suppressing Freon gas emissions by chiller renewal
・GHG emissions: Reducing by 16% from FY2011 level
GHG emission rate: Improving by 37% from FY2011 level

・Recycling rate: 98.5% or higher

Nissan Chemical Corporation Integrated Report 201852

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Environment Safety and Climate Change Strategy
Environmental Impact from Business Activities

Environmental and Safety Accounting

The figure below shows the inputs of raw materials, energy and water for production and emissions to the atmosphere, waters, soil and waste. This is the summaryof environmental impact yielded by the Company.

We have made active investment in equipments and facilities such as conversion of the fuel from heavy oil to natural gas for melamine heating furnaces at Toyama
plant to save energy and reduce GHG emissions. We also renovate aging facilities and implement constructions for occupational safety and work environment
improvement measures in a well-planned manner to ensure safety and disaster prevention and maintain safe operation.

FY2017 Environmental Impact Results
Environmental Accounting

INPUT
Raw Materials
365,218ｔ

Energy Input

97,468kL（Crude oil equivalent）
Energy:fuel, purchased electricity and purchased steam used
for business activities (volume of fuel and purchased
steam: crude oil equivalent)

Our investment plans in equipments and facilities were categorized according to Environmental Accounting Guidelines 2005 published by the Ministry of theEnvironment, and the amount of investment and expenses were calculated.

Water Resources Input
42,140,000m3

Category

Water resources:
tap water, ground water andindustrial water used forbusiness activities

Pollution Prevention

Business Area

FY2017

EffectContent

86

Compliance

Waste water measures, leakage prevention,and improvement of pollution control equipment
Conversion of fuel and feedstock forammonia, and fuel for melamine
heating furnaces
Downsizing nitric acid plants

Investment (million yen) Expenses (million yen)
226

GlobalEnvironmental
Conservation

560

626

Economic benefit : 398 million yen
Energy consumption rate : Improving by 24% from FY2011 level
GHG emissions : Reducing by 53,000 tons-CO2efrom FY2016 (Reducing by 15%
from FY2011 level), Reducing
SOx (by 50% from FY2016 level)

Resource Circulation

20

358

Reducing final disposal volume of waste Costs for the transportation and disposal of industrial waste

01

Supply chain management

EHS audit travel expenses for suppliers

ISO14001: Acquired certificationin 2015 version

ISO activities expenses–certification, training,
personnel and business travel expenses

Production Activities（Five plants）
Upstream / Downstream

OUTPUT

Volume of production 715,302t
Emissions to the Atmosphere
CO2
GHG other than CO2
NOx
SOx
Dust
PRTR substances

232,000 tons-CO2
148,000 tons-CO2e
112 tons
192 tons
18 tons
0.47 tons

Emissions to the AtmosphereCO2 : the amount of CO2 emitted from business activities
GHG other than CO2: the amount of CH4, N2O, HFC and SF6
NOx ,SOx , dust: the amount of NOx , SOx , and dust included in emissions
from each burning facility

Emissions into Waters
Effluent
COD
Total nitrogen
Total phosphorus
PRTR substances

Emissions to the Soil

14,428,000 m3
291 tons
2,879 tons
13 tons0.45 tons

PRTR substances

Emissions into waters
COD, Total nitrogen, Total phosphorus: amount calculated by multiplying effluent
to the public waters by the concentration of nitrogen, phosphorus and COD

Total
Recycled
External disposal

N/A

Waste
34,651 tons
5,572 tons
806 tons

Waste
Recycled: the amount of waste recycled
External disposal: the final amount of landfill disposal by contractor

Administration

0

228

R&D

54

559

Promotion of R&D related to environment and energy R&D expenses related to environment and energy

Social Activity

0

21

Information disclosure and contribution to local communities Publication of annual report and maintain of biotope

Environmental Remediation

0

1

Total

859

1,880

Compliance

Expenses on countermeasures against soil contamination

Safety Accounting

Our investment plans in equipments and facilities related to safety were categorized into “Safety and Disaster Prevention”, “Occupational Safety”,“Administration”, and “Social Activity” and the amount of investment and expenses were calculated.
Category

FY2017

EffectContent

748

Zero accident of fire / explosion / leaking chemicals,
and prevention of trouble at manufacturing

Leakage prevention, facility deterioration
measures, and maintenance

Investment (million yen) Expenses (million yen)

Safety and Disaster Prevention

1,723

Occupational Safety

235

29

Prevention of occupational accident

Improvement of unsafe areas

Administration

0226

Prevention of occupational accident

Personnel and business travel expenses

Information disclosure

Publication of annual reportSocial Activity

0

14

Total

1,958

1,017

Major Results in FY2017 Concerning Reduction of Environmental Impact
Reduction of
24%

53

Energy consumption rate(compared to FY2011)

Nissan Chemical Corporation Integrated Report 2018

Reduction of
53,000tons

GHG emissions(compared to FY2016)

Reduction of50%

Sulfur oxide (SOx) emissions(compared to FY2016)

Nissan Chemical Corporation Integrated Report 201854

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Environment Safety and Climate Change Strategy
Environmental Impact from Business Activities

Environmental and Safety Accounting

The figure below shows the inputs of raw materials, energy and water for production and emissions to the atmosphere, waters, soil and waste. This is the summaryof environmental impact yielded by the Company.

We have made active investment in equipments and facilities such as conversion of the fuel from heavy oil to natural gas for melamine heating furnaces at Toyama
plant to save energy and reduce GHG emissions. We also renovate aging facilities and implement constructions for occupational safety and work environment
improvement measures in a well-planned manner to ensure safety and disaster prevention and maintain safe operation.

FY2017 Environmental Impact Results
Environmental Accounting

INPUT
Raw Materials
365,218ｔ

Energy Input

97,468kL（Crude oil equivalent）
Energy:fuel, purchased electricity and purchased steam used
for business activities (volume of fuel and purchased
steam: crude oil equivalent)

Our investment plans in equipments and facilities were categorized according to Environmental Accounting Guidelines 2005 published by the Ministry of theEnvironment, and the amount of investment and expenses were calculated.

Water Resources Input
42,140,000m3

Category

Water resources:
tap water, ground water andindustrial water used forbusiness activities

Pollution Prevention

Business Area

FY2017

EffectContent

86

Compliance

Waste water measures, leakage prevention,and improvement of pollution control equipment
Conversion of fuel and feedstock forammonia, and fuel for melamine
heating furnaces
Downsizing nitric acid plants

Investment (million yen) Expenses (million yen)
226

GlobalEnvironmental
Conservation

560

626

Economic benefit : 398 million yen
Energy consumption rate : Improving by 24% from FY2011 level
GHG emissions : Reducing by 53,000 tons-CO2efrom FY2016 (Reducing by 15%
from FY2011 level), Reducing
SOx (by 50% from FY2016 level)

Resource Circulation

20

358

Reducing final disposal volume of waste Costs for the transportation and disposal of industrial waste

01

Supply chain management

EHS audit travel expenses for suppliers

ISO14001: Acquired certificationin 2015 version

ISO activities expenses–certification, training,
personnel and business travel expenses

Production Activities（Five plants）
Upstream / Downstream

OUTPUT

Volume of production 715,302t
Emissions to the Atmosphere
CO2
GHG other than CO2
NOx
SOx
Dust
PRTR substances

232,000 tons-CO2
148,000 tons-CO2e
112 tons
192 tons
18 tons
0.47 tons

Emissions to the AtmosphereCO2 : the amount of CO2 emitted from business activities
GHG other than CO2: the amount of CH4, N2O, HFC and SF6
NOx ,SOx , dust: the amount of NOx , SOx , and dust included in emissions
from each burning facility

Emissions into Waters
Effluent
COD
Total nitrogen
Total phosphorus
PRTR substances

Emissions to the Soil

14,428,000 m3
291 tons
2,879 tons
13 tons0.45 tons

PRTR substances

Emissions into waters
COD, Total nitrogen, Total phosphorus: amount calculated by multiplying effluent
to the public waters by the concentration of nitrogen, phosphorus and COD

Total
Recycled
External disposal

N/A

Waste
34,651 tons
5,572 tons
806 tons

Waste
Recycled: the amount of waste recycled
External disposal: the final amount of landfill disposal by contractor

Administration

0

228

R&D

54

559

Promotion of R&D related to environment and energy R&D expenses related to environment and energy

Social Activity

0

21

Information disclosure and contribution to local communities Publication of annual report and maintain of biotope

Environmental Remediation

0

1

Total

859

1,880

Compliance

Expenses on countermeasures against soil contamination

Safety Accounting

Our investment plans in equipments and facilities related to safety were categorized into “Safety and Disaster Prevention”, “Occupational Safety”,“Administration”, and “Social Activity” and the amount of investment and expenses were calculated.
Category

FY2017

EffectContent

748

Zero accident of fire / explosion / leaking chemicals,
and prevention of trouble at manufacturing

Leakage prevention, facility deterioration
measures, and maintenance

Investment (million yen) Expenses (million yen)

Safety and Disaster Prevention

1,723

Occupational Safety

235

29

Prevention of occupational accident

Improvement of unsafe areas

Administration

0226

Prevention of occupational accident

Personnel and business travel expenses

Information disclosure

Publication of annual reportSocial Activity

0

14

Total

1,958

1,017

Major Results in FY2017 Concerning Reduction of Environmental Impact
Reduction of
24%

53

Energy consumption rate(compared to FY2011)

Nissan Chemical Corporation Integrated Report 2018

Reduction of
53,000tons

GHG emissions(compared to FY2016)

Reduction of50%

Sulfur oxide (SOx) emissions(compared to FY2016)

Nissan Chemical Corporation Integrated Report 201854

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Reduction of GHG Emissions (scope 1, 2)

Amount of Energy Consumption and Energy Consumption Rate

In accordance with the “Act on Promotion of Global Warming Countermeasures”, we collect data on the emissions of carbon dioxide (CO2) and other GHG from all of our businessestablishments, including our plants, laboratories, and head office and submit this data to the national government. In FY2017, the conversion of the fuel of melamine heating furnacefrom heavy oil to natural gas, which generates less GHG, helped to reduce GHG emissions from energy use and non-energy use. The volume of reduction of emissions was 53,000
tons-CO2e compared to FY2016 levels. By reducing emissions by 15% from FY2011 level, the energy consumption rate calculated as a ratio of emissions and sales (emissions /sales) significantly improved by 64% compared to that of FY2011.

Production, research and office

GHG emissions (1,000 tons-CO2e)

Index of the GHG emission rate (FY2011 as a base of 100)

500

100

36%

400

220
300

248

250

237

255

246
232

53

200

100

175

0

2011

49
140
2012
CO2 emissions
from energy use

55
153
2013

53
172

2014

55
152
2015

CO2 emissions
from non-energy use

31
155
2016

50

100

94

93

89

87

Logistics
78

23

64

124
2017 (FY)

0

2011

2012

2013

2014

2015

2016

2017

(FY)

Dinitrogen monoxide (N2O)

To discover our GHG emissions throughout the supply chain, from the purchase of raw materials to use and disposal by customers, we calculated our indirect GHG
emissions via the supply chain (Scope 3) in addition to our direct GHG emissions (Scope 1) and indirect emissions derived from energy (Scope 2). We also
participated in the Ministry of the Environment’s SC (Supply Chain) emissions calculation support project, and the results of these initiatives are available on theGreen Value Chain Platform website at https://www.env.go.jp/earth/ondanka/supply_chain/gvc/en/. Scope 3 was calculated and found to be accounted for 62% ofpurchased products and services.

Scope 355

Item
Purchased goods and services
Capital goods
Fuel- and energy- related activities not included in Scope 1 or 2
Transportation and distribution (upstream)
Waste generated in operations
Business travel
Employee commuting
Leased assets (upstream)
Transportation and distribution (downstream)
Processing of sold products
Use of sold products
End-of-life treatment of sold products
Leased assets (downstream)
Franchises
Investments

Nissan Chemical Corporation Integrated Report 2018

As a cargo owner, we work together with Nissan Butsuryu Co., Ltd., a group company
which handles our logistics operations, to promote the rational use of energy fortransportation. In FY2017, the amount of energy consumption in crude oil equivalent
increased from the previous fiscal year. However, the energy consumption rate was
improved. We will continue striving to improve our energy consumption rate throughmeasures such as promoting modal shifts, replacing vehicles with energy-saving andpracticing eco-driving.

100

100.0

96.4

89.1

96.9

96.7

94.8

2011

2012

2013

81.5

86.1

83.1

75.5

98.8

99.4

97.5

2016

2017

75
50
25
0

91.9

2014

2015

Energy consumption(FY)

Energy consumption index

Energy consumption (left axis: crude oil equivalent 1,000kL) and energy consumption rate(right axis: kL / one million ton kilo) in logistics
8

35.4

35.9

36.5

36.5

36.3

35.7

35.5

30

6
4
2
0

40

5.0

5.0

5.2

5.2

5.2

5.4

5.8

2011

2012

2013

2014

2015

2016

2017 (FY)

Energy consumption

20
10
0

Energy consumption rate

T O P I C SReduction of GHG Emissions (Scope 3)

No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

In accordance with the “Act on the Rational Use of Energy”, we collect data on the amount ofenergy consumed at all of our business establishments and submit this data to the national
government, along with data on our energy consumption rate. Our energy consumption(crude oil equivalent) in FY 2017 reduced compared to that of previous fiscal year. We havea product matrix that covers a wide range of products, from commodity chemicals toagrochemicals, pharmaceuticals and functional products for electronic materials. This is why
we calculate it not based on simple quantity of production but based on sales. This
consumption rate improved from the previous fiscal year by 7.6%. This is attributed mainly toconversion of the fuel from heavy oil and naphtha to natural gas. In FY2018, our head office
was relocated to a highly energy-saving-efficient building (PAL / ERR Stage 3).

Energy consumption (crude oil equivalent 1,000kL) and energy consumption index(FY2011 as a base of 100) in production, research and office
125

Calculated value (tCO2e)472,635
39,0288,610
14,921
6,458
1,606
392
Included in Scope 1 or 2
1,579
149,41065,8322,617
183
Not applicableNot applicable

9%
20%

62%

Efforts for Reducing GHG Emissions
At the Toyama Plant, fuel and feedstock for ammonia were conversed from naphtha and heavy oil tonatural gas in August 2016 and fuel for melamine heating furnace in August 2017. This contributed toa major achievement in reducing emissions of not only carbon dioxide but also sulfur oxides (SOx). We
also contributed to reduction of GHG emissions by making effective use of carbon dioxide, which is aby-product of the manufacturing process.
On the other hand, in July 2017, production capacity of nitric acid was optimized to reduce nitrous
oxide (N2O) emissions generated from reactors by approximately 30,000 tons as CO2 equivalent perannual. This year, we plan to switch fuel used in heating furnaces using cyanuric acid as a heating
medium. We will continue to expand the use of natural gas for other boiler fuels and consider ways toreduce the amount of GHG emissions in order to reduce our environmental impact.

5%
Purchased goods and services

Employee commuting

Capital goods

Transportation and distribution(downstream)

Fuel- and energy- related activities
not included in Scope 1 or 2

Processing of sold products

Transportation and distribution (upstream)

Use of sold products

Waste generated in operations

End-of-life treatment of sold products

Business travel

Leased assets (downstream)▲Melamine heating furnace

Nissan Chemical Corporation Integrated Report 201856

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Reduction of GHG Emissions (scope 1, 2)

Amount of Energy Consumption and Energy Consumption Rate

In accordance with the “Act on Promotion of Global Warming Countermeasures”, we collect data on the emissions of carbon dioxide (CO2) and other GHG from all of our businessestablishments, including our plants, laboratories, and head office and submit this data to the national government. In FY2017, the conversion of the fuel of melamine heating furnacefrom heavy oil to natural gas, which generates less GHG, helped to reduce GHG emissions from energy use and non-energy use. The volume of reduction of emissions was 53,000
tons-CO2e compared to FY2016 levels. By reducing emissions by 15% from FY2011 level, the energy consumption rate calculated as a ratio of emissions and sales (emissions /sales) significantly improved by 64% compared to that of FY2011.

Production, research and office

GHG emissions (1,000 tons-CO2e)

Index of the GHG emission rate (FY2011 as a base of 100)

500

100

36%

400

220
300

248

250

237

255

246
232

53

200

100

175

0

2011

49
140
2012
CO2 emissions
from energy use

55
153
2013

53
172

2014

55
152
2015

CO2 emissions
from non-energy use

31
155
2016

50

100

94

93

89

87

Logistics
78

23

64

124
2017 (FY)

0

2011

2012

2013

2014

2015

2016

2017

(FY)

Dinitrogen monoxide (N2O)

To discover our GHG emissions throughout the supply chain, from the purchase of raw materials to use and disposal by customers, we calculated our indirect GHG
emissions via the supply chain (Scope 3) in addition to our direct GHG emissions (Scope 1) and indirect emissions derived from energy (Scope 2). We also
participated in the Ministry of the Environment’s SC (Supply Chain) emissions calculation support project, and the results of these initiatives are available on theGreen Value Chain Platform website at https://www.env.go.jp/earth/ondanka/supply_chain/gvc/en/. Scope 3 was calculated and found to be accounted for 62% ofpurchased products and services.

Scope 355

Item
Purchased goods and services
Capital goods
Fuel- and energy- related activities not included in Scope 1 or 2
Transportation and distribution (upstream)
Waste generated in operations
Business travel
Employee commuting
Leased assets (upstream)
Transportation and distribution (downstream)
Processing of sold products
Use of sold products
End-of-life treatment of sold products
Leased assets (downstream)
Franchises
Investments

Nissan Chemical Corporation Integrated Report 2018

As a cargo owner, we work together with Nissan Butsuryu Co., Ltd., a group company
which handles our logistics operations, to promote the rational use of energy fortransportation. In FY2017, the amount of energy consumption in crude oil equivalent
increased from the previous fiscal year. However, the energy consumption rate was
improved. We will continue striving to improve our energy consumption rate throughmeasures such as promoting modal shifts, replacing vehicles with energy-saving andpracticing eco-driving.

100

100.0

96.4

89.1

96.9

96.7

94.8

2011

2012

2013

81.5

86.1

83.1

75.5

98.8

99.4

97.5

2016

2017

75
50
25
0

91.9

2014

2015

Energy consumption(FY)

Energy consumption index

Energy consumption (left axis: crude oil equivalent 1,000kL) and energy consumption rate(right axis: kL / one million ton kilo) in logistics
8

35.4

35.9

36.5

36.5

36.3

35.7

35.5

30

6
4
2
0

40

5.0

5.0

5.2

5.2

5.2

5.4

5.8

2011

2012

2013

2014

2015

2016

2017 (FY)

Energy consumption

20
10
0

Energy consumption rate

T O P I C SReduction of GHG Emissions (Scope 3)

No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

In accordance with the “Act on the Rational Use of Energy”, we collect data on the amount ofenergy consumed at all of our business establishments and submit this data to the national
government, along with data on our energy consumption rate. Our energy consumption(crude oil equivalent) in FY 2017 reduced compared to that of previous fiscal year. We havea product matrix that covers a wide range of products, from commodity chemicals toagrochemicals, pharmaceuticals and functional products for electronic materials. This is why
we calculate it not based on simple quantity of production but based on sales. This
consumption rate improved from the previous fiscal year by 7.6%. This is attributed mainly toconversion of the fuel from heavy oil and naphtha to natural gas. In FY2018, our head office
was relocated to a highly energy-saving-efficient building (PAL / ERR Stage 3).

Energy consumption (crude oil equivalent 1,000kL) and energy consumption index(FY2011 as a base of 100) in production, research and office
125

Calculated value (tCO2e)472,635
39,0288,610
14,921
6,458
1,606
392
Included in Scope 1 or 2
1,579
149,41065,8322,617
183
Not applicableNot applicable

9%
20%

62%

Efforts for Reducing GHG Emissions
At the Toyama Plant, fuel and feedstock for ammonia were conversed from naphtha and heavy oil tonatural gas in August 2016 and fuel for melamine heating furnace in August 2017. This contributed toa major achievement in reducing emissions of not only carbon dioxide but also sulfur oxides (SOx). We
also contributed to reduction of GHG emissions by making effective use of carbon dioxide, which is aby-product of the manufacturing process.
On the other hand, in July 2017, production capacity of nitric acid was optimized to reduce nitrous
oxide (N2O) emissions generated from reactors by approximately 30,000 tons as CO2 equivalent perannual. This year, we plan to switch fuel used in heating furnaces using cyanuric acid as a heating
medium. We will continue to expand the use of natural gas for other boiler fuels and consider ways toreduce the amount of GHG emissions in order to reduce our environmental impact.

5%
Purchased goods and services

Employee commuting

Capital goods

Transportation and distribution(downstream)

Fuel- and energy- related activities
not included in Scope 1 or 2

Processing of sold products

Transportation and distribution (upstream)

Use of sold products

Waste generated in operations

End-of-life treatment of sold products

Business travel

Leased assets (downstream)▲Melamine heating furnace

Nissan Chemical Corporation Integrated Report 201856

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Efficient Use of Water Resources

Control of Waste Water

Control of Exhaust Gas

Reduction of Emissions of VOCs

At each plant, we carry out exhaustive water-saving activities by observing environmental laws andregulations and cooperating with local organizations. These activities ensure that our operations do notplace an impact on natural water circulation. We also clean waste water before returning it to nature toprevent it from negative impact on the environment.
At the Toyama Plant, we have been promoting the rational use of groundwater as a member of thegroundwater use council in the Toyama area, a local council that works to protect the local naturalenvironment and promote the sound development of local communities. At the Onoda Plant, we havebeen taking measures to maintain the quality of waste water discharged from the plant in line with the“Act on Special Measures concerning Conservation of the Environment of the Seto Inland Sea”.

Our plants observe the discharge standards stipulated in the “Water Pollution
Control Act” and regulatory values based on agreements with local
communities. We monitor the chemical oxygen demand (COD), the total
nitrogen and total phosphorous concentration in waste water. In FY2017, theemissions of all of them decreased compared to that of previous fiscal year.

We control exhaust gas by observing the discharge standards in the “Air Pollution
Control Act” and regulatory values based on agreements with local communities. We
maintain the proper conditions in our desulfurization facilities and denitrification
facilities in an effort to control the emissions of air pollutants such as sulfur oxide(SOx) and nitrogen oxide (NOx). In FY2017, SOx emissions was reduced by 50%
compared to that of previous fiscal year by boiler fuel conversion to natural gas.

We regularly take initiatives to reduce emissions of volatile organic compounds (VOCs), which cause theformation of photochemical oxidants. Among the twelve substances of VOCs which were selected,
formulated voluntary management plan, and worked on reduction by chemical industry, three(1,2-dichloroethane, benzene, and formaldehyde) were handled in the Company. As a result of measures
such as the introduction of VOC removal equipment, 1,2-dichloroethane has not been discharged to theatmosphere since 2006. In addition, emissions of benzene have been eliminated since FY2017 due to theconversion of naphtha to natural gas as a fuel and feedstock. We are also reducing emissions offormaldehyde through measures such as sealing facilities and combustion treatment of exhaust gases.

COD (left axis) / Total phosphorus (left axis) / Total nitrogen (right axis) emissions (ton)
4,000

400

381

Water input / Effluent (Million m3)

3,356

359

45.0

3,123

3,064

300

40.0

150

41.1

41.1

42.2

42.8

0

2,294

200

1,000

10.0
5.0

15.1

15.0

14.4
13

11
0.0

2013

2014

2015

2016
Water resources input

2017

(FY)

Effluent

0

2013

2014

COD emissions

18

14
2015

2016

Total phosphorus emissions

13
2017

(FY)

0

Total nitrogen emissions

T O P I C S

57

Nissan Chemical Corporation Integrated Report 2018

Emissions of organic air pollutants (ton)
1.0

114

158

148

0.8

192

0.83 0.82

0.6

112

0.4

0.26

2013

2014

2015

2016
SOx emissions

2017

0.0

(FY)

1998

0.17

2013

0.27

0.20 0.17

0.17

2014

0.13 0.17

2015

NOx emissions

We thoroughly implement control measures to ensure the proper disposal of waste, while also are
striving to reduce industrial waste. We also applied electronic manifests using legal compliancesystem for waste.
Waste water discharged in the manufacturing process accounts for the majority of our industrial waste.
We treat this waste internally by means of combustion. The amount of waste generated began torise in FY2014 due to an increase in the production volume of organic fine chemicals and flame
retardants attributed to their new uses. As for solid waste, we reuse sludge as feedstock for thebase course material of roads and cement. In addition, at the Toyama Plant, we promote therecycling of waste plastics and the conversion of such plastics to valuables, and we have changed
the method of their intermediate processing to increase the recycling volume. As a result, the final
disposal volume reduced compared to that of FY2016. The recycling rate* was calculated andconfirmed to be 97.9% in FY2017. Our goal is to achieve a recycling rate of 99.5% or higher.

0.16
0.00

2016

2017(FY)

BenzeneFormaldehyde

Volume of waste generation (1,000tons)
40
30
20

26.3

10
0

2013

33.0

33.4

33.7

34.7

2014

2015

2016

2017

(FY)

Volume of waste generation
Recycled volume / Final disposal volume (1,000tons)
6
4
2
0

2.4

1.5

4.5

3.1 2.3

2013

2014

5.6

3.8 1.1

2.2

2015*Recycling rate (%)＝[Recycled volume (ton)+Volume of valuable regenerative (ton)＋Volume of reduction (ton)]÷
[Volume of waste generation (ton)＋Volume of valuable regenerative (ton)]×100

Use of Renewable Energy
The Toyama Plant mainly produces ammonia-based products andperformance materials. It makes the plant consume a large amountof purchased electricity in the manufacturing process. This electricity
is supplied by electric power corporations and Toyama Kyodo
Jikahatsuden Co., Ltd., which was established through investment
by companies in the Toyama Prefecture, including the Company.
Toyama Kyodo Jikahatsuden Co., Ltd. uses the abundant water fromthe Jinzu River System to generate hydroelectric power at theMiza / Kuzuyama Power Station in Takayama City, Gifu Prefecture.
At the Toyama Plant, purchased electricity generated at thesehydroelectric power station is used at approximately one-third of theentire electricity consumption. We will continue to use
environmentally friendly natural energy in the future.

50%

382

Reduction of Waste
100

14.9

146

2,000

42.1

15.0

15.1

391

0.2

249

30.0

20.0

3,000

291

279

345

300

2,879
294

35.0

25.0

SOx emissions / NOx emissions (ton)
450

2016

0.8

2017

Recycled volume(FY)

Final disposal volume

Reduction of Emissions of PRTR Substances▲Miza Power Station▲Kuzuyama Power Station

In FY2017, we emitted 60 chemical substances whose emissions must be
registered in accordance with the “Act on Confirmation, etc. of Release
Amounts of Specific Chemical Substances in the Environment and Promotionof Improvements to the Management Thereof (PRTR law)”. The main
substances emitted were formaldehyde and n-hexane. Formaldehyde is used
as a reaction solvent. n-Hexane has been greatly reduced by switching fueland feedstock from naphtha to natural gas. As a result, the total emissions
have been significantly reduced by half emissions to the atmosphere andwaters totaled 0.92 tons, of 0.47 tons and 0.45 tons, respectively. We willcontinue to take steps to control the emissions. We did not emit thesesubstances into the soil.

Emissions of PRTR substances (ton)
Substance

FY2013

FY2014FY2015FY2016FY2017

Formaldehyde

0.5

0.4

0.5

0.3

0.4

n-Hexane

1.4

1.4

1.3

1.1

0.2

Others

0.4

0.5

0.4

0.4

0.3

Total

2.3

2.3

2.2

1.8

0.9

Breakdown of emissions of PRTR substances (ton)
3
2

1.8

1.9

1.7

1

0.5

0.4

0.5

0.4

2013

2014

2015

2016
2017 (FY)
Atmosphere
Waters

0

1.5

0.5
0.4

Nissan Chemical Corporation Integrated Report 201858

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Efficient Use of Water Resources

Control of Waste Water

Control of Exhaust Gas

Reduction of Emissions of VOCs

At each plant, we carry out exhaustive water-saving activities by observing environmental laws andregulations and cooperating with local organizations. These activities ensure that our operations do notplace an impact on natural water circulation. We also clean waste water before returning it to nature toprevent it from negative impact on the environment.
At the Toyama Plant, we have been promoting the rational use of groundwater as a member of thegroundwater use council in the Toyama area, a local council that works to protect the local naturalenvironment and promote the sound development of local communities. At the Onoda Plant, we havebeen taking measures to maintain the quality of waste water discharged from the plant in line with the“Act on Special Measures concerning Conservation of the Environment of the Seto Inland Sea”.

Our plants observe the discharge standards stipulated in the “Water Pollution
Control Act” and regulatory values based on agreements with local
communities. We monitor the chemical oxygen demand (COD), the total
nitrogen and total phosphorous concentration in waste water. In FY2017, theemissions of all of them decreased compared to that of previous fiscal year.

We control exhaust gas by observing the discharge standards in the “Air Pollution
Control Act” and regulatory values based on agreements with local communities. We
maintain the proper conditions in our desulfurization facilities and denitrification
facilities in an effort to control the emissions of air pollutants such as sulfur oxide(SOx) and nitrogen oxide (NOx). In FY2017, SOx emissions was reduced by 50%
compared to that of previous fiscal year by boiler fuel conversion to natural gas.

We regularly take initiatives to reduce emissions of volatile organic compounds (VOCs), which cause theformation of photochemical oxidants. Among the twelve substances of VOCs which were selected,
formulated voluntary management plan, and worked on reduction by chemical industry, three(1,2-dichloroethane, benzene, and formaldehyde) were handled in the Company. As a result of measures
such as the introduction of VOC removal equipment, 1,2-dichloroethane has not been discharged to theatmosphere since 2006. In addition, emissions of benzene have been eliminated since FY2017 due to theconversion of naphtha to natural gas as a fuel and feedstock. We are also reducing emissions offormaldehyde through measures such as sealing facilities and combustion treatment of exhaust gases.

COD (left axis) / Total phosphorus (left axis) / Total nitrogen (right axis) emissions (ton)
4,000

400

381

Water input / Effluent (Million m3)

3,356

359

45.0

3,123

3,064

300

40.0

150

41.1

41.1

42.2

42.8

0

2,294

200

1,000

10.0
5.0

15.1

15.0

14.4
13

11
0.0

2013

2014

2015

2016
Water resources input

2017

(FY)

Effluent

0

2013

2014

COD emissions

18

14
2015

2016

Total phosphorus emissions

13
2017

(FY)

0

Total nitrogen emissions

T O P I C S

57

Nissan Chemical Corporation Integrated Report 2018

Emissions of organic air pollutants (ton)
1.0

114

158

148

0.8

192

0.83 0.82

0.6

112

0.4

0.26

2013

2014

2015

2016
SOx emissions

2017

0.0

(FY)

1998

0.17

2013

0.27

0.20 0.17

0.17

2014

0.13 0.17

2015

NOx emissions

We thoroughly implement control measures to ensure the proper disposal of waste, while also are
striving to reduce industrial waste. We also applied electronic manifests using legal compliancesystem for waste.
Waste water discharged in the manufacturing process accounts for the majority of our industrial waste.
We treat this waste internally by means of combustion. The amount of waste generated began torise in FY2014 due to an increase in the production volume of organic fine chemicals and flame
retardants attributed to their new uses. As for solid waste, we reuse sludge as feedstock for thebase course material of roads and cement. In addition, at the Toyama Plant, we promote therecycling of waste plastics and the conversion of such plastics to valuables, and we have changed
the method of their intermediate processing to increase the recycling volume. As a result, the final
disposal volume reduced compared to that of FY2016. The recycling rate* was calculated andconfirmed to be 97.9% in FY2017. Our goal is to achieve a recycling rate of 99.5% or higher.

0.16
0.00

2016

2017(FY)

BenzeneFormaldehyde

Volume of waste generation (1,000tons)
40
30
20

26.3

10
0

2013

33.0

33.4

33.7

34.7

2014

2015

2016

2017

(FY)

Volume of waste generation
Recycled volume / Final disposal volume (1,000tons)
6
4
2
0

2.4

1.5

4.5

3.1 2.3

2013

2014

5.6

3.8 1.1

2.2

2015*Recycling rate (%)＝[Recycled volume (ton)+Volume of valuable regenerative (ton)＋Volume of reduction (ton)]÷
[Volume of waste generation (ton)＋Volume of valuable regenerative (ton)]×100

Use of Renewable Energy
The Toyama Plant mainly produces ammonia-based products andperformance materials. It makes the plant consume a large amountof purchased electricity in the manufacturing process. This electricity
is supplied by electric power corporations and Toyama Kyodo
Jikahatsuden Co., Ltd., which was established through investment
by companies in the Toyama Prefecture, including the Company.
Toyama Kyodo Jikahatsuden Co., Ltd. uses the abundant water fromthe Jinzu River System to generate hydroelectric power at theMiza / Kuzuyama Power Station in Takayama City, Gifu Prefecture.
At the Toyama Plant, purchased electricity generated at thesehydroelectric power station is used at approximately one-third of theentire electricity consumption. We will continue to use
environmentally friendly natural energy in the future.

50%

382

Reduction of Waste
100

14.9

146

2,000

42.1

15.0

15.1

391

0.2

249

30.0

20.0

3,000

291

279

345

300

2,879
294

35.0

25.0

SOx emissions / NOx emissions (ton)
450

2016

0.8

2017

Recycled volume(FY)

Final disposal volume

Reduction of Emissions of PRTR Substances▲Miza Power Station▲Kuzuyama Power Station

In FY2017, we emitted 60 chemical substances whose emissions must be
registered in accordance with the “Act on Confirmation, etc. of Release
Amounts of Specific Chemical Substances in the Environment and Promotionof Improvements to the Management Thereof (PRTR law)”. The main
substances emitted were formaldehyde and n-hexane. Formaldehyde is used
as a reaction solvent. n-Hexane has been greatly reduced by switching fueland feedstock from naphtha to natural gas. As a result, the total emissions
have been significantly reduced by half emissions to the atmosphere andwaters totaled 0.92 tons, of 0.47 tons and 0.45 tons, respectively. We willcontinue to take steps to control the emissions. We did not emit thesesubstances into the soil.

Emissions of PRTR substances (ton)
Substance

FY2013

FY2014FY2015FY2016FY2017

Formaldehyde

0.5

0.4

0.5

0.3

0.4

n-Hexane

1.4

1.4

1.3

1.1

0.2

Others

0.4

0.5

0.4

0.4

0.3

Total

2.3

2.3

2.2

1.8

0.9

Breakdown of emissions of PRTR substances (ton)
3
2

1.8

1.9

1.7

1

0.5

0.4

0.5

0.4

2013

2014

2015

2016
2017 (FY)
Atmosphere
Waters

0

1.5

0.5
0.4

Nissan Chemical Corporation Integrated Report 201858

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Biodiversity Conservation

T O P I C S

At Nissan Chemical, we are fully aware of the fact that biodiversity serves as an important foundation for sustainable society in the future. As amember of international society, we intend to promote activities that contribute to biodiversity conservation by sharing roles andresponsibilities with all the people and working together with them. For this purpose, we have established the “Nissan Chemical Biodiversity
Action Guidelines”. In addition, in October 2015, we participated in the Japan Business and Biodiversity Partnership to promote our initiatives
for biodiversity.

Nissan Chemical Biodiversity Action Guidelines
Our corporate philosophy is “We contribute to society in harmony with the environment, based on our excellent technologies, products, and services.” We at the Nissan
Chemical Group engage in business activities that take into account biodiversity and help protect the global environment.

Nagoya Plant “Fujimae-Higata Clean-up Activities”
Since May 2016, the Nagoya Plant has participated in the Fujimae-Higata Clean-up Activities (twice a year in spring and autumn) with cooperationby employees of Nagoya Plant and subcontractors to conserve the tideland registered under the Ramsar Convention.
In 2004, four citizen collectives formed the Fujimae-Higata Clean-up Activities Planning Committee in cooperation with the government and companies to conduct aclean-up activities by river basin citizens and citizen’s groups with the objectives of “making Fujimae-Higata free from shame in the Ramsar Convention,” “restoring tidal
flats and rivers that children can play with peace of mind,” and “forming a network to think about the waste and water of the entire river basin”.
As part of our initiatives to conserve biodiversity, we will continue to contribute to the conservation of valuable tidal flat, where migratory birds gather astransit sites for long journeys.

1. We will understand, analyze, and evaluate the impact of our products on biodiversity throughout their lifecycle and strive to
reduce the impact. We will work to preserve biodiversity and ensure the sustainable use of biological resources.
2. We will strive to raise each employee’s awareness of biodiversity through responsible care activities.
3. We will continue to carry out social contribution activities that help preserve biodiversity and earn us the high esteem and trust of society.
4. We will disclose the results of these initiatives to deepen the level of communication with society.

Our Biodiversity Initiatives
Toyama Plant “Nissan Bio-Park Nishi-Hongo”
The Nissan Bio-Park Nishi-Hongo, operated by the
Toyama Plant, has lawn plazas, wetlands, ponds, brooks,
and flower fields on approximately 2 hectares of land. We
are also involved in the cultivation of fireflies and beetles
and the breeding of the endangered Nihon Medaka withthe cooperation of local residents, and retired and current Nature observation learning by elementary
school students
employees of the plant. In addition, children fromneighboring nursery schools pick up tulips, and dig bulbsof them, and elementary school students learn
Nagoya Plant “Fujimae-Higata
natural observations.

Clean-up Activities”(Refer to TOPICS)

Chemical Research Laboratories“Conservation of pine forests on the premises”
Chemical Research Laboratories is located in the northwestern partof Funabashi City, Chiba Prefecture, which was originally rich innature. In recent years, however, the use of residential land has
progressed due to the convenience of transportation. Since its
establishment in 1971,
Chemical ResearchLaboratories has been
engaged in conservation
activities to preserve pine
forests, which had spread tothe south of the premises.

59

Nissan Chemical Corporation Integrated Report 2018(USA)T O P I C SHead Office / Biological Research Laboratories Support for “Kurohama-numa Shuhen no Shizen wo Taisetsu ni Suru Kai”

Nissan Chemical America Corporation“Membership Program of Armand Bayou
Nature Center”
Head Office / Biological Research Laboratories
Support for “Kurohama-numa Shuhen no
Shizen wo Taisetsu ni Suru Kai” (Refer to TOPICS)

Sodegaura Plant“Support for the conservation of Pinus pentaphylla”
Sodegaura Plant has participated in efforts
to protect and restore the Pinus
pentaphylla, which was selected as theendangered species by Chiba Prefecture.
It grew up smoothly, and a new leaf cameout.

In FY2016, we began to support “Kurohama-numa Shuhen no Shizen wo Taisetsu ni Suru Kai (Society for Cherishing the Natural Environment around Kurohamanuma Pond)”, an
NPO in Hasuda City, Saitama Prefecture. For many years, this organization has been engaged in activities for conserving the biodiversity of the area around Kurohamanuma Pond,
which is designated as the No.11 Land for Conservation by Trust (Trust Hozen 11-gou chi) by the Saitama Greenery Trust Association of Saitama Prefecture. Every year,
representatives from the CSR & Public Relations Office, the Environment, Safety & Quality Assurance Department, and the Biological Research Laboratories visit the environmental
learning center (Kankyo Gakushu-Kan) in Hasuda City managed by the NPO to exchange opinions on biodiversity conservation. Furthermore, in 2018, in order to deepen
understanding of biodiversity conservation, we participated in the Saitama Greenery Trust Association in the vicinity of Kurohamanuma pond, and learned about forest conservation
through the lecture titled “Toward the History and Current State of Forests and Nature” sponsored by the President of the Trust Association, Professor Emeritus Takehiko Ota of the
University of Tokyo, and experienced bird-watching at nature observation meetings.
We will continue to support the NPO which conducts the community-based activities while facing issues such as dryness of the Kurohamanuma,
reduction of native species due to breeding of alien species, aging of the members.

▲Dialogue on biodiversity conservation activities▲Bird-watching session▲Rice paddies that prevent the drying of Kurohama-numa Pond

Nissan Chemical Corporation Integrated Report 201860

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Biodiversity Conservation

T O P I C S

At Nissan Chemical, we are fully aware of the fact that biodiversity serves as an important foundation for sustainable society in the future. As amember of international society, we intend to promote activities that contribute to biodiversity conservation by sharing roles andresponsibilities with all the people and working together with them. For this purpose, we have established the “Nissan Chemical Biodiversity
Action Guidelines”. In addition, in October 2015, we participated in the Japan Business and Biodiversity Partnership to promote our initiatives
for biodiversity.

Nissan Chemical Biodiversity Action Guidelines
Our corporate philosophy is “We contribute to society in harmony with the environment, based on our excellent technologies, products, and services.” We at the Nissan
Chemical Group engage in business activities that take into account biodiversity and help protect the global environment.

Nagoya Plant “Fujimae-Higata Clean-up Activities”
Since May 2016, the Nagoya Plant has participated in the Fujimae-Higata Clean-up Activities (twice a year in spring and autumn) with cooperationby employees of Nagoya Plant and subcontractors to conserve the tideland registered under the Ramsar Convention.
In 2004, four citizen collectives formed the Fujimae-Higata Clean-up Activities Planning Committee in cooperation with the government and companies to conduct aclean-up activities by river basin citizens and citizen’s groups with the objectives of “making Fujimae-Higata free from shame in the Ramsar Convention,” “restoring tidal
flats and rivers that children can play with peace of mind,” and “forming a network to think about the waste and water of the entire river basin”.
As part of our initiatives to conserve biodiversity, we will continue to contribute to the conservation of valuable tidal flat, where migratory birds gather astransit sites for long journeys.

1. We will understand, analyze, and evaluate the impact of our products on biodiversity throughout their lifecycle and strive to
reduce the impact. We will work to preserve biodiversity and ensure the sustainable use of biological resources.
2. We will strive to raise each employee’s awareness of biodiversity through responsible care activities.
3. We will continue to carry out social contribution activities that help preserve biodiversity and earn us the high esteem and trust of society.
4. We will disclose the results of these initiatives to deepen the level of communication with society.

Our Biodiversity Initiatives
Toyama Plant “Nissan Bio-Park Nishi-Hongo”
The Nissan Bio-Park Nishi-Hongo, operated by the
Toyama Plant, has lawn plazas, wetlands, ponds, brooks,
and flower fields on approximately 2 hectares of land. We
are also involved in the cultivation of fireflies and beetles
and the breeding of the endangered Nihon Medaka withthe cooperation of local residents, and retired and current Nature observation learning by elementary
school students
employees of the plant. In addition, children fromneighboring nursery schools pick up tulips, and dig bulbsof them, and elementary school students learn
Nagoya Plant “Fujimae-Higata
natural observations.

Clean-up Activities”(Refer to TOPICS)

Chemical Research Laboratories“Conservation of pine forests on the premises”
Chemical Research Laboratories is located in the northwestern partof Funabashi City, Chiba Prefecture, which was originally rich innature. In recent years, however, the use of residential land has
progressed due to the convenience of transportation. Since its
establishment in 1971,
Chemical ResearchLaboratories has been
engaged in conservation
activities to preserve pine
forests, which had spread tothe south of the premises.

59

Nissan Chemical Corporation Integrated Report 2018(USA)T O P I C SHead Office / Biological Research Laboratories Support for “Kurohama-numa Shuhen no Shizen wo Taisetsu ni Suru Kai”

Nissan Chemical America Corporation“Membership Program of Armand Bayou
Nature Center”
Head Office / Biological Research Laboratories
Support for “Kurohama-numa Shuhen no
Shizen wo Taisetsu ni Suru Kai” (Refer to TOPICS)

Sodegaura Plant“Support for the conservation of Pinus pentaphylla”
Sodegaura Plant has participated in efforts
to protect and restore the Pinus
pentaphylla, which was selected as theendangered species by Chiba Prefecture.
It grew up smoothly, and a new leaf cameout.

In FY2016, we began to support “Kurohama-numa Shuhen no Shizen wo Taisetsu ni Suru Kai (Society for Cherishing the Natural Environment around Kurohamanuma Pond)”, an
NPO in Hasuda City, Saitama Prefecture. For many years, this organization has been engaged in activities for conserving the biodiversity of the area around Kurohamanuma Pond,
which is designated as the No.11 Land for Conservation by Trust (Trust Hozen 11-gou chi) by the Saitama Greenery Trust Association of Saitama Prefecture. Every year,
representatives from the CSR & Public Relations Office, the Environment, Safety & Quality Assurance Department, and the Biological Research Laboratories visit the environmental
learning center (Kankyo Gakushu-Kan) in Hasuda City managed by the NPO to exchange opinions on biodiversity conservation. Furthermore, in 2018, in order to deepen
understanding of biodiversity conservation, we participated in the Saitama Greenery Trust Association in the vicinity of Kurohamanuma pond, and learned about forest conservation
through the lecture titled “Toward the History and Current State of Forests and Nature” sponsored by the President of the Trust Association, Professor Emeritus Takehiko Ota of the
University of Tokyo, and experienced bird-watching at nature observation meetings.
We will continue to support the NPO which conducts the community-based activities while facing issues such as dryness of the Kurohamanuma,
reduction of native species due to breeding of alien species, aging of the members.

▲Dialogue on biodiversity conservation activities▲Bird-watching session▲Rice paddies that prevent the drying of Kurohama-numa Pond

Nissan Chemical Corporation Integrated Report 201860

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Safety and Disaster Prevention, Occupational Safety and Health
Safety and Disaster Prevention

Occupational Safety and Health

We carry out risk assessment, process risk predictions, and facility risk predictions by prior assessment for manufacture with the aim of ensuring safety, achieving
stable operations, and improving our process safety capability. As a result, in FY2017, there was no accident such as explosion / leakage.
Our plants, laboratories and affiliates carry out various drills and training sessions all taking into account the characteristics of the location and region, and aredesigned to make us ready to respond to emergencies or accidents in a reliable manner.
In addition, we are working to improve issues assessed through questionnaire about safety culture at each location.

We make continuous improvements with regard to occupational safety and health as well, by implementing a PDCA cycle in our RC management system. We thereby prevent
occupational accidents, promote the good health of staff, and build a comfortable workplace environment in our efforts to improve the level of safety and health at each business location.
At business locations where occupational accidents have occurred, we conduct a thorough investigation into the causes and plan and implement emergency and permanentmeasures. This information is compiled as an occupational accident report, and the entire Nissan Chemical Group is working to prevent similar accidents by sharing informationand promoting horizontal deployment. We are also working to prevent occupational accidents at our subcontractors through safety audits.
In FY2016, we have participated in the Anzen Project (safety project) of the Ministry of Health, Labour and Welfare, and began publishing an occupational safety newspaper
in an effort to raise awareness of safety activities.

▲Disaster drill

T O P I C S▲Occupational accident report▲Occupational safety newspaper (occupational safety monthly
report, number of days of accident-free continuation)

Safety Education at Training Center
We have established a training center within the Toyama Plant to provide guidance on basic facility and work methods to young employees who have worked
for the Toyama Plant for less than 10 years. The lecturers are employees of the machinery, electricity, and instrumentation conservation division of the Toyama
Plant. While using a model of educational equipment, they teach the importance of safe work methods by actually moving hands. This training, which has been
implemented since 1991, has also accepted participants from other plants, and contributes to raising the safety awareness of the entire company.

Safety Result
In 2017, we have one case of an accident requiring staff time off from work, and nine cases of accidents not requiring staff time off from work. The number of accident
requiring staff time off from work is the same as that of previous year, and the number of accident not requiring staff time off from work increased (by 6). These were
due to increased bee sting and chemical injuries. We are aiming to achieve zero accident by promoting risk assessment, risk predictions training, HHK*1, 5S*2 andappropriate wearing of protective equipment and by raising awareness of safety through the safety meeting and the occupational safety newspapers. In measure, weplan to invest a total of 350 million yen over the three-annual period beginning in FY2016 to the safety of facilities for prevention of fall / overturning.
*1 HHK stands for Hiyari-Hatto (near miss incident) and Kigahari (alarming). It means the discovery of near-miss incidents that are not linked directly to serious injuries or accidents but could have resulted in suchinjuries or accidents.
*2 5S stands for Seiri, Seiton, Seisou, Seiketsu, Shitsuke. These words mean “Sort” “Set” “Shine” “Standardize” “Sustain” respectively.

Lost work time accidents frequency rate

（%）
2.0

1.48

1.5
1.15

0.5
0.0

61

Nissan Chemical Corporation Integrated Report 2018

0.43

0.36
0.00

2006

2007

2008

0.15

1.11

1.0
0.36

0.00
2009

2010

2011

Lost work time severity rate

（%）
0.20

0.81

0.37

0.05
0.37

0.37

2012 2013 2014
Nissan Chemical

2015 2016 2017
Chemical Industry

0.37

0.090

0.10

0.00

0.001
0.006

0.028

0.000
2006

2007

2008

0.000 0.004
0.000
2009

2010

2011

0.000

0.000

0.029

2012 2013 2014
Nissan Chemical

0.013

0.012

2015 2016 2017
Chemical Industry

Nissan Chemical Corporation Integrated Report 2018

62

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Safety and Disaster Prevention, Occupational Safety and Health
Safety and Disaster Prevention

Occupational Safety and Health

We carry out risk assessment, process risk predictions, and facility risk predictions by prior assessment for manufacture with the aim of ensuring safety, achieving
stable operations, and improving our process safety capability. As a result, in FY2017, there was no accident such as explosion / leakage.
Our plants, laboratories and affiliates carry out various drills and training sessions all taking into account the characteristics of the location and region, and aredesigned to make us ready to respond to emergencies or accidents in a reliable manner.
In addition, we are working to improve issues assessed through questionnaire about safety culture at each location.

We make continuous improvements with regard to occupational safety and health as well, by implementing a PDCA cycle in our RC management system. We thereby prevent
occupational accidents, promote the good health of staff, and build a comfortable workplace environment in our efforts to improve the level of safety and health at each business location.
At business locations where occupational accidents have occurred, we conduct a thorough investigation into the causes and plan and implement emergency and permanentmeasures. This information is compiled as an occupational accident report, and the entire Nissan Chemical Group is working to prevent similar accidents by sharing informationand promoting horizontal deployment. We are also working to prevent occupational accidents at our subcontractors through safety audits.
In FY2016, we have participated in the Anzen Project (safety project) of the Ministry of Health, Labour and Welfare, and began publishing an occupational safety newspaper
in an effort to raise awareness of safety activities.

▲Disaster drill

T O P I C S▲Occupational accident report▲Occupational safety newspaper (occupational safety monthly
report, number of days of accident-free continuation)

Safety Education at Training Center
We have established a training center within the Toyama Plant to provide guidance on basic facility and work methods to young employees who have worked
for the Toyama Plant for less than 10 years. The lecturers are employees of the machinery, electricity, and instrumentation conservation division of the Toyama
Plant. While using a model of educational equipment, they teach the importance of safe work methods by actually moving hands. This training, which has been
implemented since 1991, has also accepted participants from other plants, and contributes to raising the safety awareness of the entire company.

Safety Result
In 2017, we have one case of an accident requiring staff time off from work, and nine cases of accidents not requiring staff time off from work. The number of accident
requiring staff time off from work is the same as that of previous year, and the number of accident not requiring staff time off from work increased (by 6). These were
due to increased bee sting and chemical injuries. We are aiming to achieve zero accident by promoting risk assessment, risk predictions training, HHK*1, 5S*2 andappropriate wearing of protective equipment and by raising awareness of safety through the safety meeting and the occupational safety newspapers. In measure, weplan to invest a total of 350 million yen over the three-annual period beginning in FY2016 to the safety of facilities for prevention of fall / overturning.
*1 HHK stands for Hiyari-Hatto (near miss incident) and Kigahari (alarming). It means the discovery of near-miss incidents that are not linked directly to serious injuries or accidents but could have resulted in suchinjuries or accidents.
*2 5S stands for Seiri, Seiton, Seisou, Seiketsu, Shitsuke. These words mean “Sort” “Set” “Shine” “Standardize” “Sustain” respectively.

Lost work time accidents frequency rate

（%）
2.0

1.48

1.5
1.15

0.5
0.0

61

Nissan Chemical Corporation Integrated Report 2018

0.43

0.36
0.00

2006

2007

2008

0.15

1.11

1.0
0.36

0.00
2009

2010

2011

Lost work time severity rate

（%）
0.20

0.81

0.37

0.05
0.37

0.37

2012 2013 2014
Nissan Chemical

2015 2016 2017
Chemical Industry

0.37

0.090

0.10

0.00

0.001
0.006

0.028

0.000
2006

2007

2008

0.000 0.004
0.000
2009

2010

2011

0.000

0.000

0.029

2012 2013 2014
Nissan Chemical

0.013

0.012

2015 2016 2017
Chemical Industry

Nissan Chemical Corporation Integrated Report 2018

62

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Chemicals and Products Safety
Disclosure of Safety Summary of Chemical Substances

Chemicals Management
To achieve the “2020 goal”*1 on which agreement was reached at the “World Summit on
Sustainable Development (WSSD)” in 2002, the “Strategic Approach to International Chemicals
Management (SAICM)” for promoting risk reduction based on scientific risk assessment,collection and provision of information, and other measures were adopted at the “International
Conference on Chemicals Management (ICCM)” in 2006. At Nissan Chemical, we strive tominimize the negative impact of chemical products on people’s health and the environment
during their lifecycle in line with the domestic SAICM implementation plan.
*1 “Aiming to achieve, by 2020, that chemicals are used and produced in ways that lead to the minimization ofsignificant adverse effects on human health and the environment”

Research
Disposal

Development

ChemicalsManagement
Use

For minimizing the risks of chemical substances throughout the entire value chain, we participate in the
GPS*2 / JIPS*3 activities promoted by the International Council of Chemical Association (ICCA) and JCIA. As partof our activities, we conduct risk assessments of our chemical products, conduct appropriate risk-based
management, and provide safety information. The Information is compiled in GPS / JIPS Safety Summary andmade available to the society.
*2 Global Product Strategy*3 Japan Initiative of Product Stewardship

Manufacture
Sales

Risk Assessment in Products Lifecycle
We perform a risk assessment (prior assessment) of each step in handling chemical products, such as the research and development, manufacture, sales andrevision. The assessment of risks to human health and the environment in the value chain is based on data performed by the Biological Research Laboratories, either
on its own or by outsourcing, safety test data obtained from results of searching external databases such as literature, and checking things such as data on
physicochemical properties and work environment conditions. Based on the results of risk assessment, we avoid using chemicals of concern and study safe
alternatives. These results are reported to top management and made known to all the relevant people in the Company. The results are also made known to people inthe value chain by means such as technology transfer documents and safety data sheets(SDSs).
We also participate in Long-Range Research Initiative, an international initiative promoted by
Japan Chemical Industry Association (JCIA) that seeks to provide long-term support for researchon the impact of chemicals on human health and the environment. The activities we engage in
aim to advance research on the assessment of risks to human health and the environment.

Consideration for Animal Testing
Assessment made using laboratory animals is essential for the research and development of agrochemicals, pharmaceuticals, medical materials and chemical materials that are beneficial
for society. Biological Research Laboratories has established Animal Testing Guideline of Nissan Chemical in accordance with the Three Rs principles of animal welfare (Replacement withalternative methods, Reduction in the use of laboratory animals and Refinement of methods for reducing pain), and laws and regulations such as the “Act on Welfare and Management of
Animals”. Following this guideline, the institutional Animal Care and Use Committee examines whether to conduct animal testing, both ethically and scientifically, and checks how the tests
are performed to ensure that animal testing is conducted appropriately and that proper consideration is given to animal welfare.
Due to these initiatives, the Biological Research Laboratories has obtained third-party certification of its laboratory animal facilities from Japan Health Sciences
Foundation.

T O P I C S

New Initiative to Wastewater Assessment

Disclosure of SDS of Products
To ensure that our chemical products are used safely by our customers, we provide SDSs of all products. Customers and users can download the SDSs for all
agrochemicals from our website. (https://www.nissan-agro.net/products/index.php). Our employees can obtain information about risks and hazards, laws andregulations, transportation, storage and methods of disposal of products from our internal SDS database for safety and compliance.

63

Nissan Chemical Corporation Integrated Report 2018

Since industrial effluents are directly released to the environment, reference
values are set for each hazardous substance and released to theenvironment after they are cleared. However, this management method does
not confirm the impacts on aquatic organisms and does not comprehensively
assess wastewater. Currently, water environmental management methods
using aquatic organisms are being studied in Japan. WET (Whole Effluent
Toxicity) enables to assess the impacts of chemical substances in wastewatercomprehensively by raising aquatic organisms in wastewater and clarifying
their effect on the biological body. The Biological Research Laboratories has
applied the evaluation technology for aquatic organisms cultivated throughproduct safety assessments, and has begun initiatives to introduce WET thatincorporates the viewpoint of organisms into plant effluent assessment.

Nissan Chemical Corporation Integrated Report 2018

64

R e s ponsi bl e Car e ( RC) Ac tiv itie s

Chemicals and Products Safety
Disclosure of Safety Summary of Chemical Substances

Chemicals Management
To achieve the “2020 goal”*1 on which agreement was reached at the “World Summit on
Sustainable Development (WSSD)” in 2002, the “Strategic Approach to International Chemicals
Management (SAICM)” for promoting risk reduction based on scientific risk assessment,collection and provision of information, and other measures were adopted at the “International
Conference on Chemicals Management (ICCM)” in 2006. At Nissan Chemical, we strive tominimize the negative impact of chemical products on people’s health and the environment
during their lifecycle in line with the domestic SAICM implementation plan.
*1 “Aiming to achieve, by 2020, that chemicals are used and produced in ways that lead to the minimization ofsignificant adverse effects on human health and the environment”

Research
Disposal

Development

ChemicalsManagement
Use

For minimizing the risks of chemical substances throughout the entire value chain, we participate in the
GPS*2 / JIPS*3 activities promoted by the International Council of Chemical Association (ICCA) and JCIA. As partof our activities, we conduct risk assessments of our chemical products, conduct appropriate risk-based
management, and provide safety information. The Information is compiled in GPS / JIPS Safety Summary andmade available to the society.
*2 Global Product Strategy*3 Japan Initiative of Product Stewardship

Manufacture
Sales

Risk Assessment in Products Lifecycle
We perform a risk assessment (prior assessment) of each step in handling chemical products, such as the research and development, manufacture, sales andrevision. The assessment of risks to human health and the environment in the value chain is based on data performed by the Biological Research Laboratories, either
on its own or by outsourcing, safety test data obtained from results of searching external databases such as literature, and checking things such as data on
physicochemical properties and work environment conditions. Based on the results of risk assessment, we avoid using chemicals of concern and study safe
alternatives. These results are reported to top management and made known to all the relevant people in the Company. The results are also made known to people inthe value chain by means such as technology transfer documents and safety data sheets(SDSs).
We also participate in Long-Range Research Initiative, an international initiative promoted by
Japan Chemical Industry Association (JCIA) that seeks to provide long-term support for researchon the impact of chemicals on human health and the environment. The activities we engage in
aim to advance research on the assessment of risks to human health and the environment.

Consideration for Animal Testing
Assessment made using laboratory animals is essential for the research and development of agrochemicals, pharmaceuticals, medical materials and chemical materials that are beneficial
for society. Biological Research Laboratories has established Animal Testing Guideline of Nissan Chemical in accordance with the Three Rs principles of animal welfare (Replacement withalternative methods, Reduction in the use of laboratory animals and Refinement of methods for reducing pain), and laws and regulations such as the “Act on Welfare and Management of
Animals”. Following this guideline, the institutional Animal Care and Use Committee examines whether to conduct animal testing, both ethically and scientifically, and checks how the tests
are performed to ensure that animal testing is conducted appropriately and that proper consideration is given to animal welfare.
Due to these initiatives, the Biological Research Laboratories has obtained third-party certification of its laboratory animal facilities from Japan Health Sciences
Foundation.

T O P I C S

New Initiative to Wastewater Assessment

Disclosure of SDS of Products
To ensure that our chemical products are used safely by our customers, we provide SDSs of all products. Customers and users can download the SDSs for all
agrochemicals from our website. (https://www.nissan-agro.net/products/index.php). Our employees can obtain information about risks and hazards, laws andregulations, transportation, storage and methods of disposal of products from our internal SDS database for safety and compliance.

63

Nissan Chemical Corporation Integrated Report 2018

Since industrial effluents are directly released to the environment, reference
values are set for each hazardous substance and released to theenvironment after they are cleared. However, this management method does
not confirm the impacts on aquatic organisms and does not comprehensively
assess wastewater. Currently, water environmental management methods
using aquatic organisms are being studied in Japan. WET (Whole Effluent
Toxicity) enables to assess the impacts of chemical substances in wastewatercomprehensively by raising aquatic organisms in wastewater and clarifying
their effect on the biological body. The Biological Research Laboratories has
applied the evaluation technology for aquatic organisms cultivated throughproduct safety assessments, and has begun initiatives to introduce WET thatincorporates the viewpoint of organisms into plant effluent assessment.

Nissan Chemical Corporation Integrated Report 201864

Communication with Society

Commitment to and Communication with Stakeholders

Quality Assurance Management System

We enhance corporate
value and provide theappropriate profit returns.

Our
Group

Shareholders and Investors

Communities
and Society
We engage actively in social
contribution activities andregional interaction.

At the general shareholders’ meeting, the president, who acts as the chairman,
provides explanations of the business report and business plan. We also hold an IR
briefing meeting for institutional investors, analysts, the media, and private investors
periodically to explain the overall conditions of our business.

Employees
Every year, the president visits offices, plants, and laboratories in Japan andBusiness
Partners

Employees
We create a workplace whereindividuals are respected andare able to fully demonstrate
their abilities.

products and services.

We establish good, constructive
relationships throughfair and equitable business.

overseas to deepen mutual understanding with employees.

Business Partners
We promote supply chain management and check our business partners’ CSR
initiatives as necessary.

Communities and Society
We interact with local communities through measures such as plant tours and visits
to local elementary schools to give special classes.

*An international standard on quality management system

Reporting of Improvements and Survey Results at the Committee<Temporary voluntary inspections>
In recent years, the falsification of inspection data by other companies has become a major social issue, and the Company has conducted a temporary voluntary inspection to check whether there are any
improper or inappropriate behaviors related to quality control. As the results, although slight defects were found in the shipment management system for some products, it was confirmed that there were no
improper or inappropriate behaviors related to quality control, such as falsifying, concealing, manipulating and fabricating. We reported this defect to the board meeting and take corrective actions,
including notifying customers.
In addition, in order to implement preventive measures and continuously improve and maintain the system, we set
The number of complaintout the “implementation of quality audits of the parent company and affiliated companies with an emphasis on
10
prevention” as an action plan, and decided to give priority to the identification of potential risks in the shipping
system.

Moving forward, we will promote continuous improvements together with the plants to provide customers with safer,higher-quality products.

PDCA in Quality Assurancee

Our quality policy is “Providing products and services that satisfy customers”. Under this policy, we set mid-term quality targets and implement annual schedules
along with PDCA cycle in an ongoing effort to improve our management system and operations every year.
Moving forward, we will continue to improve our capability of meeting market needs that are becoming more diverse and complex. We will thereby develop
ourselves further as a company that contributes to society.

as

Quality Policy and Quality Targets

cre

Relationships with Customers<Intranet>
We have a corporate network that requires us to promptly collect customer opinions concerning products (including
complaints and product liability accident information), evaluate them and take corrective action if necessary.
In FY2016, there was an increase in complaints regarding distributions, such as labeling, quantity, and delivery. In
FY2017, the number of these complaints decreased due to the implementation of intensive auditing guidance for theprocess. This year, we decided to implement auditing guidance for foreign-substance, which has been increasingover the past three annuals, with a focus on the risk management system for foreign-substance contamination.

De

8

e

Shareholders
and Investors

We provide safe, secureand excellent products andservices.

asCustomers

Our quality assurance management system is based on ISO9001(QMS)*. Our plants have obtained ISO9001 certification respectively, and maintain and update their certification
through the certifying body. They have also completed the transition to the latest version: 2015.
We have established a quality assurance division that is independent of the manufacturing divisions at each plant. Each quality assurance division is responsible for inspecting thequality of each product, and the quality assurance division of the head office conducts quality audits of each plant and affiliate at least once a year. The Environment, Safety & Quality
Assurance Committee meets regularly once a year as an organization to promote quality assurance activities on a company-wide basis. The committee reports on the results ofplants’ and our affiliates’ activities, the results of audits, the status of improvements, complaints and the status of corrective actions. The committee discusses the policies for activitiesof quality assurance. Contents of the discussions are reported to the board meeting, and quality control systems are in place under management review.

re

We identify customer needs through sales activities, and work to improve ourInc

Customers

6

4

2

0

Labeling

Quantity

Delivery Foreign-substance Container
FY2016FY2017FY2015

Customer opinions concerning products (complaints and PL accident information, etc.)

Environment, Safety & Quality Assurance Committee(Report, annual plan development)

Quality Policy

Customer demands

PLAN
Implementation in accordancewith annual plan

“Providing products and services
that satisfy customers”
Quality Targets (for Achieving the Quality Policy)
Quality assurance in all processes, from design and development to production, shipment,
distribution and delivery● Taking corrective and preventive measures to address quality abnormalities and problems● Strengthening supply chain management linked to business strategies●

ACT

Operation of
Quality AssuranceDO

Annual report(performance results)
Corrective actions
CHECK
Activity report /Internal audit

Business division(planning)

Product development
Laboratories
Direction for use
Production method
Analysis method
Technology transfer

Technology transfer

Scale-up
Practical use
Acceptance ofraw materials
PassedCustomersatisfaction

Production
Plant

Production
・Product realization
・Production control
・Quality control

Performance
Materials
Shipping
PassedChemicals
Agricultural
Chemicals
Pharmaceuticals

We produce products in accordance with ISO9001:2015, the international standard of quality management, besides we produce pharmaceuticals under thequality assurance system that meets the pharmaceutical Good Manufacturing Practice (GMP), standards for manufacturing control and quality control of drugs.

65

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201866

Communication with Society

Commitment to and Communication with Stakeholders

Quality Assurance Management System

We enhance corporate
value and provide theappropriate profit returns.

Our
Group

Shareholders and Investors

Communities
and Society
We engage actively in social
contribution activities andregional interaction.

At the general shareholders’ meeting, the president, who acts as the chairman,
provides explanations of the business report and business plan. We also hold an IR
briefing meeting for institutional investors, analysts, the media, and private investors
periodically to explain the overall conditions of our business.

Employees
Every year, the president visits offices, plants, and laboratories in Japan andBusiness
Partners

Employees
We create a workplace whereindividuals are respected andare able to fully demonstrate
their abilities.

products and services.

We establish good, constructive
relationships throughfair and equitable business.

overseas to deepen mutual understanding with employees.

Business Partners
We promote supply chain management and check our business partners’ CSR
initiatives as necessary.

Communities and Society
We interact with local communities through measures such as plant tours and visits
to local elementary schools to give special classes.

*An international standard on quality management system

Reporting of Improvements and Survey Results at the Committee<Temporary voluntary inspections>
In recent years, the falsification of inspection data by other companies has become a major social issue, and the Company has conducted a temporary voluntary inspection to check whether there are any
improper or inappropriate behaviors related to quality control. As the results, although slight defects were found in the shipment management system for some products, it was confirmed that there were no
improper or inappropriate behaviors related to quality control, such as falsifying, concealing, manipulating and fabricating. We reported this defect to the board meeting and take corrective actions,
including notifying customers.
In addition, in order to implement preventive measures and continuously improve and maintain the system, we set
The number of complaintout the “implementation of quality audits of the parent company and affiliated companies with an emphasis on
10
prevention” as an action plan, and decided to give priority to the identification of potential risks in the shipping
system.

Moving forward, we will promote continuous improvements together with the plants to provide customers with safer,higher-quality products.

PDCA in Quality Assurancee

Our quality policy is “Providing products and services that satisfy customers”. Under this policy, we set mid-term quality targets and implement annual schedules
along with PDCA cycle in an ongoing effort to improve our management system and operations every year.
Moving forward, we will continue to improve our capability of meeting market needs that are becoming more diverse and complex. We will thereby develop
ourselves further as a company that contributes to society.

as

Quality Policy and Quality Targets

cre

Relationships with Customers<Intranet>
We have a corporate network that requires us to promptly collect customer opinions concerning products (including
complaints and product liability accident information), evaluate them and take corrective action if necessary.
In FY2016, there was an increase in complaints regarding distributions, such as labeling, quantity, and delivery. In
FY2017, the number of these complaints decreased due to the implementation of intensive auditing guidance for theprocess. This year, we decided to implement auditing guidance for foreign-substance, which has been increasingover the past three annuals, with a focus on the risk management system for foreign-substance contamination.

De

8

e

Shareholders
and Investors

We provide safe, secureand excellent products andservices.

asCustomers

Our quality assurance management system is based on ISO9001(QMS)*. Our plants have obtained ISO9001 certification respectively, and maintain and update their certification
through the certifying body. They have also completed the transition to the latest version: 2015.
We have established a quality assurance division that is independent of the manufacturing divisions at each plant. Each quality assurance division is responsible for inspecting thequality of each product, and the quality assurance division of the head office conducts quality audits of each plant and affiliate at least once a year. The Environment, Safety & Quality
Assurance Committee meets regularly once a year as an organization to promote quality assurance activities on a company-wide basis. The committee reports on the results ofplants’ and our affiliates’ activities, the results of audits, the status of improvements, complaints and the status of corrective actions. The committee discusses the policies for activitiesof quality assurance. Contents of the discussions are reported to the board meeting, and quality control systems are in place under management review.

re

We identify customer needs through sales activities, and work to improve ourInc

Customers

6

4

2

0

Labeling

Quantity

Delivery Foreign-substance Container
FY2016FY2017FY2015

Customer opinions concerning products (complaints and PL accident information, etc.)

Environment, Safety & Quality Assurance Committee(Report, annual plan development)

Quality Policy

Customer demands

PLAN
Implementation in accordancewith annual plan

“Providing products and services
that satisfy customers”
Quality Targets (for Achieving the Quality Policy)
Quality assurance in all processes, from design and development to production, shipment,
distribution and delivery● Taking corrective and preventive measures to address quality abnormalities and problems● Strengthening supply chain management linked to business strategies●

ACT

Operation of
Quality AssuranceDO

Annual report(performance results)
Corrective actions
CHECK
Activity report /Internal audit

Business division(planning)

Product development
Laboratories
Direction for use
Production method
Analysis method
Technology transfer

Technology transfer

Scale-up
Practical use
Acceptance ofraw materials
PassedCustomersatisfaction

Production
Plant

Production
・Product realization
・Production control
・Quality control

Performance
Materials
Shipping
PassedChemicals
Agricultural
Chemicals
Pharmaceuticals

We produce products in accordance with ISO9001:2015, the international standard of quality management, besides we produce pharmaceuticals under thequality assurance system that meets the pharmaceutical Good Manufacturing Practice (GMP), standards for manufacturing control and quality control of drugs.

65

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201866

C o m muni cat i on with So c ie ty

Relationships with Business Partners

Relationships with Shareholders and Investors

Supply Chain Management

We have formulated a Disclosure Policy and disclose information in accordance with the rules on timely disclosure established by the Tokyo Stock Exchange, Inc. on

We have established a policy on the procurement of materials. We work on priority topics of CSR together with our business partners in our efforts to fulfill our
corporate social responsibility.
Before outsourcing an operation such as the manufacture of important raw materials, intermediates and products, we ask the potential contractors to answer aquestionnaire on CSR. We give priority to companies which fulfill our standards when selecting business partners. We revised the questionnaire in FY2017 to implement
our procurement and purchase activity based on the purchase policy and to promote CSR activity in supply chain.
We also conduct on-site audits of suppliers in Japan and overseas to check their initiatives for CSR activities in detail, with a particular focus on their activities related
to EHS in our efforts to promote supply chain management. In addition, we have made it our policy not to use conflict minerals and raw materials containing suchminerals related to inhumane armed groups in the Democratic Republic of the Congo and surrounding countries.

Main item in CSR questionnaire
Content

Item
1. Human Rights,
Labor
2. Consideration for
the Environment

which our shares are listed. We also regularly report the opinions of shareholders and institutional investors, which are captured through dialogue, to the board meeting.

Disclosure Policy (Excerpt)1) Information Disclosure Standards
The Company will disclose its information in accordance with the “Financial Instruments and Exchange Act” and other laws and ordinances, and with the “Securities Listing Regulations”,
and other rules concerned with timely disclosure established by Tokyo Stock Exchange, Inc. where the Company’s shares are listed (hereinafter the “Timely Disclosure Rules”).
In the case where there arises any matter with significant impact on securities investment decisions such as facts concerning decisions or occurrences, financial results andinformation on any subsidiary, where Tokyo Stock Exchange, Inc. makes an inquiry and requests disclosure of the fact concerned with the inquiry, or where any material content
regarding the Company’s information already disclosed is changed, suspended or the like, the Company will disclose information in compliance with the Timely Disclosure Rules.
In addition, the Company endeavors to disclose company information other than that is required under the Timely Disclosure Rules (hereinafter “information
subject to timely disclosure”), including materials presented in company briefing sessions, as positively and impartially as possible to meet investors’ requests.

Prohibition of forced or compulsory labor, Prohibition of child labor, Prohibition of inhumane treatment, Non-discrimination,2) Information Disclosure Methods

Appropriate wages, Adequate hours of work, and Right to organize

The Company will swiftly publish information that falls under the information subject to timely disclosure by means of the Timely Disclosure Network (TDnet) provided by Tokyo
Stock Exchange, Inc., as well as on its own website. At the time of disclosing any information that is not subject to timely disclosure, the Company shall give consideration totransmission of the information to general investors in an appropriate, accurate and impartial manner in view of the objective of the Timely Disclosure Rules.

Chemicals management, Resource and energy-saving, Reduction of GHG emissions, Reduction of waste, Biodiversity conservation,
Water resources conservation, and Raw material procurement

3. Health and Safety

Health and safety at workplaces and facilities, Consideration for physically impact work, Occupational accidents response, Emergency response, and Health care

4. Ethic

Prohibition of corruption and bribery, Prohibition of abuse of dominant bargaining position, Prohibition of improper offering andreceipt of profit, Prohibition of restrictive competition, Prohibition of insider trading, Elimination of antisocial forces, Consultation
hotline, Privacy protection, and the Non-use of conflict minerals

5. Building of crisis management systems

Formulation of business continuity plans, Understanding of information on business partners and production bases, and Information security

6. Quality

Accurate information and Response to complaints

Institutional Investors, Analysts and the MediaWe hold a financial briefing meeting for institutional investors, analysts and the media every half year to explain the overall conditions of our business. This
meeting is attended by the CFO / Officer in charge of Financial Department and the managers responsible for individual divisions. We also hold tours of ourfacilities for institutional investors and analysts as needed so that they can see our work sites in person and better understand our production and research. In
addition, we participate every year in conferences in Japan and overseas hosted by securities companies.

Overseas Investors
Purchase Policy
We procure and purchase raw materials and materials in accordance with our Basic CSR Policy.
1. Compliance with laws, regulations and social norms
We promote sound procurement and purchase activities by observing all relevant laws, regulations, social norms, and internal regulations, as well as corporate ethics.
2. Fair, equitable, transparent trades
We continue to create opportunities for business with new suppliers, without adhering to past purchases or the corporate group, thereby ensuring fair, equitable, transparent trades.
3. Procurement and purchase based on economic rationality
We undertake procurement and purchase that are optimal for us based on a comprehensive evaluation of quality, price, stable supply, technology
development capabilities, stable management and other factors.
4. Consideration for the global environment
To achieve a sustainable society, we strive to remain conscious of the protection of the global environment in our procurement and purchase activities.
5. Establishment of partnership
Based on our fundamental recognition that all of our business partners are essential for executing businesses, we establish relationships of mutual trust with them inour efforts to achieve further development. We will also work on the following themes with our business partners in our efforts to fulfill our corporate social responsibility.
1) Compliance with laws, regulations, social norms and corporate ethics
2) Ensure safety and protecting the environment3) Respect human rights and giving consideration to the work environment

67

Nissan Chemical Corporation Integrated Report 2018

The CFO / Officer in charge of Financial Department participates every year in conferences hosted by securities
companies or other entities that are held in the United States, Europe, Asia and other regions. At these
conferences, the CFO provides explanations directly to overseas investors and exchanges opinions with them.
We publish news releases, business plans, presentation materials for full-year and first-half financial results
briefing sessions in both Japanese and English at the same time, in principle, with the aim of disclosing
information more promptly and fairly to investors in Japan and overseas.
▲Financial results briefing meeting

Private Investors
Once a year, we hold a briefing session for private investors, at which the CFO / Officer in charge of Financial Department provides explanations. We also hold a convivial
party for shareholders after the end of each general shareholders’ meeting to promote constructive dialogues with the shareholders who participated in the meeting.

Environmental Reporting Platform Development Pilot ProjectAs part of our efforts to disclose ESG information, which has been growing in demand from institutional investors in recent years, we have participated in
the “Environmental Reporting Platform Development Pilot Project” established by the Ministry of the Environment.

Nissan Chemical Corporation Integrated Report 201868

C o m muni cat i on with So c ie ty

Relationships with Business Partners

Relationships with Shareholders and Investors

Supply Chain Management

We have formulated a Disclosure Policy and disclose information in accordance with the rules on timely disclosure established by the Tokyo Stock Exchange, Inc. on

We have established a policy on the procurement of materials. We work on priority topics of CSR together with our business partners in our efforts to fulfill our
corporate social responsibility.
Before outsourcing an operation such as the manufacture of important raw materials, intermediates and products, we ask the potential contractors to answer aquestionnaire on CSR. We give priority to companies which fulfill our standards when selecting business partners. We revised the questionnaire in FY2017 to implement
our procurement and purchase activity based on the purchase policy and to promote CSR activity in supply chain.
We also conduct on-site audits of suppliers in Japan and overseas to check their initiatives for CSR activities in detail, with a particular focus on their activities related
to EHS in our efforts to promote supply chain management. In addition, we have made it our policy not to use conflict minerals and raw materials containing suchminerals related to inhumane armed groups in the Democratic Republic of the Congo and surrounding countries.

Main item in CSR questionnaire
Content

Item
1. Human Rights,
Labor
2. Consideration for
the Environment

which our shares are listed. We also regularly report the opinions of shareholders and institutional investors, which are captured through dialogue, to the board meeting.

Disclosure Policy (Excerpt)1) Information Disclosure Standards
The Company will disclose its information in accordance with the “Financial Instruments and Exchange Act” and other laws and ordinances, and with the “Securities Listing Regulations”,
and other rules concerned with timely disclosure established by Tokyo Stock Exchange, Inc. where the Company’s shares are listed (hereinafter the “Timely Disclosure Rules”).
In the case where there arises any matter with significant impact on securities investment decisions such as facts concerning decisions or occurrences, financial results andinformation on any subsidiary, where Tokyo Stock Exchange, Inc. makes an inquiry and requests disclosure of the fact concerned with the inquiry, or where any material content
regarding the Company’s information already disclosed is changed, suspended or the like, the Company will disclose information in compliance with the Timely Disclosure Rules.
In addition, the Company endeavors to disclose company information other than that is required under the Timely Disclosure Rules (hereinafter “information
subject to timely disclosure”), including materials presented in company briefing sessions, as positively and impartially as possible to meet investors’ requests.

Prohibition of forced or compulsory labor, Prohibition of child labor, Prohibition of inhumane treatment, Non-discrimination,2) Information Disclosure Methods

Appropriate wages, Adequate hours of work, and Right to organize

The Company will swiftly publish information that falls under the information subject to timely disclosure by means of the Timely Disclosure Network (TDnet) provided by Tokyo
Stock Exchange, Inc., as well as on its own website. At the time of disclosing any information that is not subject to timely disclosure, the Company shall give consideration totransmission of the information to general investors in an appropriate, accurate and impartial manner in view of the objective of the Timely Disclosure Rules.

Chemicals management, Resource and energy-saving, Reduction of GHG emissions, Reduction of waste, Biodiversity conservation,
Water resources conservation, and Raw material procurement

3. Health and Safety

Health and safety at workplaces and facilities, Consideration for physically impact work, Occupational accidents response, Emergency response, and Health care

4. Ethic

Prohibition of corruption and bribery, Prohibition of abuse of dominant bargaining position, Prohibition of improper offering andreceipt of profit, Prohibition of restrictive competition, Prohibition of insider trading, Elimination of antisocial forces, Consultation
hotline, Privacy protection, and the Non-use of conflict minerals

5. Building of crisis management systems

Formulation of business continuity plans, Understanding of information on business partners and production bases, and Information security

6. Quality

Accurate information and Response to complaints

Institutional Investors, Analysts and the MediaWe hold a financial briefing meeting for institutional investors, analysts and the media every half year to explain the overall conditions of our business. This
meeting is attended by the CFO / Officer in charge of Financial Department and the managers responsible for individual divisions. We also hold tours of ourfacilities for institutional investors and analysts as needed so that they can see our work sites in person and better understand our production and research. In
addition, we participate every year in conferences in Japan and overseas hosted by securities companies.

Overseas Investors
Purchase Policy
We procure and purchase raw materials and materials in accordance with our Basic CSR Policy.
1. Compliance with laws, regulations and social norms
We promote sound procurement and purchase activities by observing all relevant laws, regulations, social norms, and internal regulations, as well as corporate ethics.
2. Fair, equitable, transparent trades
We continue to create opportunities for business with new suppliers, without adhering to past purchases or the corporate group, thereby ensuring fair, equitable, transparent trades.
3. Procurement and purchase based on economic rationality
We undertake procurement and purchase that are optimal for us based on a comprehensive evaluation of quality, price, stable supply, technology
development capabilities, stable management and other factors.
4. Consideration for the global environment
To achieve a sustainable society, we strive to remain conscious of the protection of the global environment in our procurement and purchase activities.
5. Establishment of partnership
Based on our fundamental recognition that all of our business partners are essential for executing businesses, we establish relationships of mutual trust with them inour efforts to achieve further development. We will also work on the following themes with our business partners in our efforts to fulfill our corporate social responsibility.
1) Compliance with laws, regulations, social norms and corporate ethics
2) Ensure safety and protecting the environment3) Respect human rights and giving consideration to the work environment

67

Nissan Chemical Corporation Integrated Report 2018

The CFO / Officer in charge of Financial Department participates every year in conferences hosted by securities
companies or other entities that are held in the United States, Europe, Asia and other regions. At these
conferences, the CFO provides explanations directly to overseas investors and exchanges opinions with them.
We publish news releases, business plans, presentation materials for full-year and first-half financial results
briefing sessions in both Japanese and English at the same time, in principle, with the aim of disclosing
information more promptly and fairly to investors in Japan and overseas.
▲Financial results briefing meeting

Private Investors
Once a year, we hold a briefing session for private investors, at which the CFO / Officer in charge of Financial Department provides explanations. We also hold a convivial
party for shareholders after the end of each general shareholders’ meeting to promote constructive dialogues with the shareholders who participated in the meeting.

Environmental Reporting Platform Development Pilot ProjectAs part of our efforts to disclose ESG information, which has been growing in demand from institutional investors in recent years, we have participated in
the “Environmental Reporting Platform Development Pilot Project” established by the Ministry of the Environment.

Nissan Chemical Corporation Integrated Report 201868

C o m muni cat i on with So c ie ty

Relationships with Communities and Society
We recognize that creating a sustainable society is essential for the growth and development of the Company. As a corporate citizen, we engage in a range of social
contribution activities in addition to providing products and services with new values that help enrich people’s lives.

We have been engaged in welfare fund activities since 1997 as a part of our activities for contributing to local communities. These activities are carried out at thehead office and individual offices, plants, laboratories and group companies. They are also conducted as joint projects. In these activities, there are cases that staff
members visit welfare facilities and ask them what items they need before considering what to donate. Overall, the activities are carried out in a community-basedmanner.

Support for the Next Generation
We have been involved with the “Tobitate! (Leap for Tomorrow) Young Ambassador Program”, a joint
government-industry project for supporting students who wish to study overseas since FY2015. This program is aimed
at fostering globally competitive individuals who will demonstrate their capabilities on the world stage in the future.
Japanese companies make donations and regularly in cooperate with student selection and other processes as judges
to send high school and university students, who are the potential future leaders of Japan, to various parts of the world.
And we participated in the event, “Summer Riko-Challe” for the first time in 2017. This event cohosted by the
Cabinet Office, the Ministry of Education, Culture, Sports, Science and Technology and Keidanren (the Japan
Business Federation) is aimed at arousing interest in and promoting understanding of careers in the field of
science and technology among female students. Thirteen female junior high school students from Saitama andother prefectures participated in the work experience at the Biological Research Laboratories and the exchange
meeting with female researchers to deepen their interest in science and engineering.
In addition, we provide a various support activities for the next generation. Employees visited to elementary
schools near the Chemical Research Laboratories and the Materials Research Laboratories for classes. At the
Biological Science Laboratories, junior high school students had a work experience. Plants and laboratories
accepted interns and dispatched part-time lectures.

Welfare FundT O P I C S

Welfare Fund Activities (Extraordinary Contributions toCommemorate the 130th Anniversary)▲Internship at Sodegaura Plant

FY2017 is the 20th anniversary of the Welfare Fund, the group madeextraordinary contributions in three districts: Toyama, Sanyo Onoda(Yamaguchi Prefecture), and Saitama as one of the events commemorating
the 130th anniversary of Nissan Chemical’s foundation. We were able todonate expensive goods that were truly needed in the field of welfare andthat were difficult to donate in ordinary years, such as welfare vehicles, tosupport facilities for the disabled and extraordinary nursing homes for theelderly.
▲Presentation ceremony in the Toyama area

Interaction with Local Residents
We hold plant tours and explanatory meetings on regular basis for local residents and schools. During these meetings we explain our initiatives for disasterprevention and environmental protection in an effort to show that the plants are safe and secure. We also participate in local beautification activities such as
cleaning of public roads and nearby stations around the plants, and activities for planting flowers together with local residents.

T O P I C S

Cherry blossom festival at Onoda Plant
Onoda Plant takes place a Cherry blossom festival every year to develop the deep and warm personal relationship with local residents. This festival marked
the 27th on April 7, 2018 since Onoda Plant started the event in 1990. Everyone was able to feel a sense of unity with the enthusiasm of staff of Onoda Plant
through a variety of hand-made programs. It blew out the cold though it was slightly chilly day.

▲Presentation ceremony in the Sanyo Onoda area

▲Presentation ceremony in the Saitama area

Industry Awards
To support the development of synthetic organic chemistry, we established the “Nissan Chemical Award for Novel Reaction & Method” in FY2009 as an award
presented by the Society of Synthetic Organic Chemistry, Japan. This award is granted to researchers who have made creative, excellent achievements in research
related to novel reactions and methods. The research undertaken by Professor Takanori Shibata of Waseda University, who was the FY2017 recipient of the award,
provides new method for simple synthesis of a group of compounds which have high synthetic value-added asymmetric backbones with high atomic efficiency using
a catalyst that can be easily prepared from commercially available iridium and rhodium complexes, and asymmetric ligands. This research has contributed greatly tothe development of this field.

69

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201870

C o m muni cat i on with So c ie ty

Relationships with Communities and Society
We recognize that creating a sustainable society is essential for the growth and development of the Company. As a corporate citizen, we engage in a range of social
contribution activities in addition to providing products and services with new values that help enrich people’s lives.

We have been engaged in welfare fund activities since 1997 as a part of our activities for contributing to local communities. These activities are carried out at thehead office and individual offices, plants, laboratories and group companies. They are also conducted as joint projects. In these activities, there are cases that staff
members visit welfare facilities and ask them what items they need before considering what to donate. Overall, the activities are carried out in a community-basedmanner.

Support for the Next Generation
We have been involved with the “Tobitate! (Leap for Tomorrow) Young Ambassador Program”, a joint
government-industry project for supporting students who wish to study overseas since FY2015. This program is aimed
at fostering globally competitive individuals who will demonstrate their capabilities on the world stage in the future.
Japanese companies make donations and regularly in cooperate with student selection and other processes as judges
to send high school and university students, who are the potential future leaders of Japan, to various parts of the world.
And we participated in the event, “Summer Riko-Challe” for the first time in 2017. This event cohosted by the
Cabinet Office, the Ministry of Education, Culture, Sports, Science and Technology and Keidanren (the Japan
Business Federation) is aimed at arousing interest in and promoting understanding of careers in the field of
science and technology among female students. Thirteen female junior high school students from Saitama andother prefectures participated in the work experience at the Biological Research Laboratories and the exchange
meeting with female researchers to deepen their interest in science and engineering.
In addition, we provide a various support activities for the next generation. Employees visited to elementary
schools near the Chemical Research Laboratories and the Materials Research Laboratories for classes. At the
Biological Science Laboratories, junior high school students had a work experience. Plants and laboratories
accepted interns and dispatched part-time lectures.

Welfare FundT O P I C S

Welfare Fund Activities (Extraordinary Contributions toCommemorate the 130th Anniversary)▲Internship at Sodegaura Plant

FY2017 is the 20th anniversary of the Welfare Fund, the group madeextraordinary contributions in three districts: Toyama, Sanyo Onoda(Yamaguchi Prefecture), and Saitama as one of the events commemorating
the 130th anniversary of Nissan Chemical’s foundation. We were able todonate expensive goods that were truly needed in the field of welfare andthat were difficult to donate in ordinary years, such as welfare vehicles, tosupport facilities for the disabled and extraordinary nursing homes for theelderly.
▲Presentation ceremony in the Toyama area

Interaction with Local Residents
We hold plant tours and explanatory meetings on regular basis for local residents and schools. During these meetings we explain our initiatives for disasterprevention and environmental protection in an effort to show that the plants are safe and secure. We also participate in local beautification activities such as
cleaning of public roads and nearby stations around the plants, and activities for planting flowers together with local residents.

T O P I C S

Cherry blossom festival at Onoda Plant
Onoda Plant takes place a Cherry blossom festival every year to develop the deep and warm personal relationship with local residents. This festival marked
the 27th on April 7, 2018 since Onoda Plant started the event in 1990. Everyone was able to feel a sense of unity with the enthusiasm of staff of Onoda Plant
through a variety of hand-made programs. It blew out the cold though it was slightly chilly day.

▲Presentation ceremony in the Sanyo Onoda area

▲Presentation ceremony in the Saitama area

Industry Awards
To support the development of synthetic organic chemistry, we established the “Nissan Chemical Award for Novel Reaction & Method” in FY2009 as an award
presented by the Society of Synthetic Organic Chemistry, Japan. This award is granted to researchers who have made creative, excellent achievements in research
related to novel reactions and methods. The research undertaken by Professor Takanori Shibata of Waseda University, who was the FY2017 recipient of the award,
provides new method for simple synthesis of a group of compounds which have high synthetic value-added asymmetric backbones with high atomic efficiency using
a catalyst that can be easily prepared from commercially available iridium and rhodium complexes, and asymmetric ligands. This research has contributed greatly tothe development of this field.

69

Nissan Chemical Corporation Integrated Report 2018

Nissan Chemical Corporation Integrated Report 201870

C o m muni cat i on with So c ie ty

Relationships with Employees

Activities for Recruiting Foreign Students

Approach
In order to achieve “Progress2030” and “Vista2021,” it is essential that each employee demonstrates his or her ability and revitalizes organization. To this end, we are implementing
ranges of initiatives, including human resource development and the promotion of diversity. In addition, in order to create a comfortable workplace, we are promoting mental andother health initiatives. In February 2018, as in the last year, we received certification under the 2018 Certified Health and Productivity Management Organization Recognition
Program (White 500)*. We will continue to create an organization, system, and workplace environment that will enable employees to fully demonstrate their capabilities.
*A program for recognizing “health and productivity management” initiatives with which employee health management is considered from the viewpoint of business administration and put
into practice strategically.

Personnel system
We aim to create an organization in which diverse human resources can work together and enjoy the challenge of innovation to realize corporate vision in 2030. To
this end, we are promoting the following new measures while maintaining the current framework of our professional qualification system.
Establishment of the “Ideal Human Resource Portfolio” and Human Resource Development Policy
Introduction of career support programs that encourage individuals to take on “challenges”● Development of human resources with management capability, business creativity and global competitiveness, and enhancement of measures to foster them at an early stage●

We recruit foreign students as a measure for developing globally competitive
human resources. As a results, three foreign people joined in April 2018. Moving
forward, we will continue to promote the diversity of our human resources by
employing foreign students continuously and create an organization that will allow
diverse human resources to demonstrate their capabilities.

Percentage of employees with disabilities

(％)
2.40

2.35%

2.30

2.15%

2.20

2.21%

2.22%

2.10

Employment of People with Disabilities

2.23%

2.12%

2.00

For more than ten years, we have kept the percentage of employees withdisabilities at a level above the statutory minimum rate. We will continue toobserve the legal requirements and remain proactive in providing workplaces thatenable the active participation of people with disabilities.

1.96%

1.90

Statutory minimum rate
2012 and before: 1.80%
Since 2013 : 2.00%(Since 2018: 2.20%)

1.80
1.70
(FY)

2011

2012

2013

2014

2015

2016

2017

Training and Capability Development●

Fair Personnel Evaluation

Educational Training System

CSR training

2017

Training on health management / promotion

2016

Compliance training

2015

Acquisition of qualifications

2014

Dispatch to external classes for acquiring specialized knowledge

2013

Correspondence course

2012

New employee
training

Cross-cultural communication training (Overseas
language program, English conversation training, etc.)

2011

CommonDomestic and overseas study programs

0.0
(FY)

Business improvement
training

Second year
self-start training
New employee
self-start training

CommonProduction technology presentation

Nissan Chemical Corporation Integrated Report 2018

14.0%

12.0%

10.0

Third year
self-start training

Managerial position / C class

Strategic OJT

17.1%

●

71

28.3%

21.9%

19.2%

Training before promotion
to A3 classManagerial position / C class

CommonTheme proposal system

20.0

28.2%

Training before promotion to C3 class

Cultural education

R&D strategic planning training

30.0

Training for improving
on-site capabilities

Support for careerdevelopment

Dispatch to external research institutions

Target: 30%

Training before promotion to
managerial position

Developing a cosmopolitan
way of thinking

Participation in academic meetings

40.0

A class

Improving research and development capabilities andproduction technology capabilities

Internal research exchange meeting

Period of the plan : Five years from April 1, 2016 to March 31, 2021
● Target: Increase the proportion of women among employees in themain career track to 10% or higher● Actions to take
1. Increase the proportion of women among new graduates in
the main career track to 30% or higher
2. Assign women proactively to departments with low rates offemale employees in the main career track

Proportion of women among new graduates in the main career track

Managerial position / C class

Evaluator
training

Action Plan for Promoting Active Participation of Women in the Workplace (Excerpt)(％)

Non-managerial positions

Respect for Diversity, Personal Characteristics and Ways of Thinking of Individuals

Developing leadershipManagerial
positions

We have positioned dialogue as a means of communication to overcome conflicts and cooperation by freely communicating with each other, and we are striving to
improve the quality and speed of business through the management of objectives for each fiscal year.
In addition to this target management, our evaluation system is designed to enable employees to develop their strengths and demonstrate their personality through two-way
communication between themselves and their superiors so that “self-independent individual” realizes how one wants it to be, thereby enabling them to work with enthusiasm
while realizing growth. We are enhancing transparency and employees’ satisfaction, and strive to fairly evaluate personnel according to results and contributions.
The final evaluation for each fiscal year is fed back by the Personnel Department to the department, the secondary evaluators, the primary evaluators, and theemployees under the four objectives of 1) to motivate them to take on challenges, 2) to improve their satisfaction, 3) to foster a sense of human resource
development among their superiors, and 4) to clarify their capabilities development goals.
In the annual evaluator training, employees are trained in practical methods of evaluating, communicating, and putting those methods into practice, with theobjectives of 1) understanding the role and significance of the evaluation in the personnel system, and 2) creating a system in which the evaluation is appropriately
operated as the cornerstone of human resource development, while keeping in mind the basics of evaluations that should be learned by evaluators.

At Nissan Chemical, a diverse range of individuals have been actively contributing
to the group with their excellent talents in a wide range of fields irrespective of theage, gender and nationality and we will continue to promote respect for diversity.
One thing that we are proud of is our high employee retention rate, such as
15.9-year of the average length of service, it makes us believe that our workplaceenvironment allows each individual employee to play an active part.

We believe it is essential for human resource development that “each employee should continue to educate themselves voluntarily in their efforts to develop themselves”.
We have therefore introduced various human resource development programs for our employees who aspire to learn new things and develop themselves.

List of training programs (implemented in FY2017)
Name
New employee training
New employee follow up training
Second year self-start training
Third year self-start training
C2 kick-off training
Training before promotion to C3 class / Managerial position
Training before promotion to A3 class
Evaluator training
Domestic and overseas study program
Overseas language study programE-mail writing training
Strategic OJTCorrespondence course

Content
Number of trainees
Improvement of communication skills / Career training
39
Improvement of communication skills / Cultivation of stress management skills
39
Presentation of assigned research papers
43
Presentation of assigned research papers
37
Development of junior leadership / Career education
37
37
Developing the capability of setting essential challenges and the capability of formulating strategies
20
Development of leadership30
Improvement of evaluation skills
5
Development of next-generation leaders
7
Development of globally competitive human resources
67
Improvement of skills in writing e-mail in English
18
Improvement of capability of developing human resources
602 cases
Improvement of business execution capability

Period21days
2days
1day
1day
2days
6days
4days
1day
90days1day

Nissan Chemical Corporation Integrated Report 201872

C o m muni cat i on with So c ie ty

Relationships with Employees

Activities for Recruiting Foreign Students

Approach
In order to achieve “Progress2030” and “Vista2021,” it is essential that each employee demonstrates his or her ability and revitalizes organization. To this end, we are implementing
ranges of initiatives, including human resource development and the promotion of diversity. In addition, in order to create a comfortable workplace, we are promoting mental andother health initiatives. In February 2018, as in the last year, we received certification under the 2018 Certified Health and Productivity Management Organization Recognition
Program (White 500)*. We will continue to create an organization, system, and workplace environment that will enable employees to fully demonstrate their capabilities.
*A program for recognizing “health and productivity management” initiatives with which employee health management is considered from the viewpoint of business administration and put
into practice strategically.

Personnel system
We aim to create an organization in which diverse human resources can work together and enjoy the challenge of innovation to realize corporate vision in 2030. To
this end, we are promoting the following new measures while maintaining the current framework of our professional qualification system.
Establishment of the “Ideal Human Resource Portfolio” and Human Resource Development Policy
Introduction of career support programs that encourage individuals to take on “challenges”● Development of human resources with management capability, business creativity and global competitiveness, and enhancement of measures to foster them at an early stage●

We recruit foreign students as a measure for developing globally competitive
human resources. As a results, three foreign people joined in April 2018. Moving
forward, we will continue to promote the diversity of our human resources by
employing foreign students continuously and create an organization that will allow
diverse human resources to demonstrate their capabilities.

Percentage of employees with disabilities

(％)
2.40

2.35%

2.30

2.15%

2.20

2.21%

2.22%

2.10

Employment of People with Disabilities

2.23%

2.12%

2.00

For more than ten years, we have kept the percentage of employees withdisabilities at a level above the statutory minimum rate. We will continue toobserve the legal requirements and remain proactive in providing workplaces thatenable the active participation of people with disabilities.

1.96%

1.90

Statutory minimum rate
2012 and before: 1.80%
Since 2013 : 2.00%(Since 2018: 2.20%)

1.80
1.70
(FY)

2011

2012

2013

2014

2015

2016

2017

Training and Capability Development●

Fair Personnel Evaluation

Educational Training System

CSR training

2017

Training on health management / promotion

2016

Compliance training

2015

Acquisition of qualifications

2014

Dispatch to external classes for acquiring specialized knowledge

2013

Correspondence course

2012

New employee
training

Cross-cultural communication training (Overseas
language program, English conversation training, etc.)

2011

CommonDomestic and overseas study programs

0.0
(FY)

Business improvement
training

Second year
self-start training
New employee
self-start training

CommonProduction technology presentation

Nissan Chemical Corporation Integrated Report 2018

14.0%

12.0%

10.0

Third year
self-start training

Managerial position / C class

Strategic OJT

17.1%

●

71

28.3%

21.9%

19.2%

Training before promotion
to A3 classManagerial position / C class

CommonTheme proposal system

20.0

28.2%

Training before promotion to C3 class

Cultural education

R&D strategic planning training

30.0

Training for improving
on-site capabilities

Support for careerdevelopment

Dispatch to external research institutions

Target: 30%

Training before promotion to
managerial position

Developing a cosmopolitan
way of thinking

Participation in academic meetings

40.0

A class

Improving research and development capabilities andproduction technology capabilities

Internal research exchange meeting

Period of the plan : Five years from April 1, 2016 to March 31, 2021
● Target: Increase the proportion of women among employees in themain career track to 10% or higher● Actions to take
1. Increase the proportion of women among new graduates in
the main career track to 30% or higher
2. Assign women proactively to departments with low rates offemale employees in the main career track

Proportion of women among new graduates in the main career track

Managerial position / C class

Evaluator
training

Action Plan for Promoting Active Participation of Women in the Workplace (Excerpt)(％)

Non-managerial positions

Respect for Diversity, Personal Characteristics and Ways of Thinking of Individuals

Developing leadershipManagerial
positions

We have positioned dialogue as a means of communication to overcome conflicts and cooperation by freely communicating with each other, and we are striving to
improve the quality and speed of business through the management of objectives for each fiscal year.
In addition to this target management, our evaluation system is designed to enable employees to develop their strengths and demonstrate their personality through two-way
communication between themselves and their superiors so that “self-independent individual” realizes how one wants it to be, thereby enabling them to work with enthusiasm
while realizing growth. We are enhancing transparency and employees’ satisfaction, and strive to fairly evaluate personnel according to results and contributions.
The final evaluation for each fiscal year is fed back by the Personnel Department to the department, the secondary evaluators, the primary evaluators, and theemployees under the four objectives of 1) to motivate them to take on challenges, 2) to improve their satisfaction, 3) to foster a sense of human resource
development among their superiors, and 4) to clarify their capabilities development goals.
In the annual evaluator training, employees are trained in practical methods of evaluating, communicating, and putting those methods into practice, with theobjectives of 1) understanding the role and significance of the evaluation in the personnel system, and 2) creating a system in which the evaluation is appropriately
operated as the cornerstone of human resource development, while keeping in mind the basics of evaluations that should be learned by evaluators.

At Nissan Chemical, a diverse range of individuals have been actively contributing
to the group with their excellent talents in a wide range of fields irrespective of theage, gender and nationality and we will continue to promote respect for diversity.
One thing that we are proud of is our high employee retention rate, such as
15.9-year of the average length of service, it makes us believe that our workplaceenvironment allows each individual employee to play an active part.

We believe it is essential for human resource development that “each employee should continue to educate themselves voluntarily in their efforts to develop themselves”.
We have therefore introduced various human resource development programs for our employees who aspire to learn new things and develop themselves.

List of training programs (implemented in FY2017)
Name
New employee training
New employee follow up training
Second year self-start training
Third year self-start training
C2 kick-off training
Training before promotion to C3 class / Managerial position
Training before promotion to A3 class
Evaluator training
Domestic and overseas study program
Overseas language study programE-mail writing training
Strategic OJTCorrespondence course

Content
Number of trainees
Improvement of communication skills / Career training
39
Improvement of communication skills / Cultivation of stress management skills
39
Presentation of assigned research papers
43
Presentation of assigned research papers
37
Development of junior leadership / Career education
37
37
Developing the capability of setting essential challenges and the capability of formulating strategies
20
Development of leadership30
Improvement of evaluation skills
5
Development of next-generation leaders
7
Development of globally competitive human resources
67
Improvement of skills in writing e-mail in English
18
Improvement of capability of developing human resources
602 cases
Improvement of business execution capability

Period21days
2days
1day
1day
2days
6days
4days
1day
90days1day

Nissan Chemical Corporation Integrated Report 201872

C o m muni cat i on with So c ie tyAwards Program

HealthEvery year we grant awards to employees who have made beneficial inventions, devised improvement measures, or made remarkable achievements and contributions. Regarding intellectual properties, we also reward
excellent inventions selected from among patent-pending inventions at an early stage in an effort to create greater incentive for R&D, discover excellent inventions and improve upon their quality and creativity.

We have promoted mental and physical health initiatives based on the belief that employees’ health is a “foundation that supports sound corporate growth”. In 2018,
we have established a Basic Health Policy with the aim of maintaining and improving the health of our employees.
Concretely, we are implementing measures for lifestyle-related diseases, mental health care, and quitting smoking to promote the health of our employees incooperation with the health insurance association.

FY2017 Award (Award-winning projects: FY2016)
Name

Presenter

Content

Number of awards Number of rewarded

Central Awards
Division Awards
Office Awards

President and CEO
Head of each division
Head of each officeCommend employees who have made beneficial
inventions, devised improvement measures, or maderemarkable achievements and contributions.

1
2
3

5
19
18

Rewards for
Excellent
Inventions

Officer in chargeof Intellectual
Property Department

Reward excellent inventions at an early stage topromote the improvement of R&D capabilities. Rank S
rewards are granted to more excellent inventions.

18(Rank S:
3 inventions)58

Basic Health Policy
Mental and physical health is a foundation that supports sound corporate growth from the viewpoint of the happiness of employees and their families, as well as
the trust of the corporate and the smooth operation of the business. We and our employees will work together to promote initiatives aimed at maintaining andpromoting health in a multifaceted manner and aim to be a dynamic company.
1. Employees’ health is based on their own management and we will provide support.
2. We will implement effective and flexible measures through smooth internal and external cooperation.
3. We will ensure the proper use and management of personal information and comply with laws and regulations.

▲Central Awards presentation ceremony

Creation of a Comfortable Workplace
We have introduced a wide variety of programs and measures that enable employees to work in a highly productive manner and achieve a good work-life balance.
In addition to maintaining the high rate of employees taking annual leave of 70% or more in recent years, we are also aiming to support more efficient ways ofworking and taking time off. For example, we have decided to implement a new hourly leave system by the end of FY2018.

Content

Flextime

This system has been introduced at the head office and laboratories.

Childcare Leave

In the case that certain requirements are fulfilled, an employee may take childcare leave until
his or her child is two years old or until the coming April 20 after the child’s first birthday.

Paternity Leave

A male employee whose spouse gave birth to a child may take up to seven days of paternity
leave (paid) within eight weeks of the child’s birth.

Nursing Care Leave

An employee may use up to 20 days per year of annual leave which has been saved up forchildcare or spousal care and which is no longer valid.

Shorter Working Hours

Specified working hours may be shortened by units of 30 minutes and by up to 120 minutes
for looking after children in third grade (elementary school) or younger.

Half-day Leave

An employee may take annual leave by units of half days, with an upper limit of 30 times per year.

Planned Leave

We recommended 2days of company-wide planned leave and 3days of individual planned leave annually.

Hourly Annual Leave (introduced in November 2018)

An employee may take hourly annual leave up to 24 hours.

Annual Leave Accumulation

An employee may save up a maximum of 40 days of annual leave that are invalid and use them as medical leave,
leave for their own sickness, to look after elderly or sick family members or for other similar purposes.

Refreshment Leave

An employee may take ten consecutive days of leave (paid) after becoming 50 years old. Financial aid is also granted.

Re-employment Refreshment Leave

An employee may take three consecutive days of leave (paid) before or after their mandatory retirement.

Overseas Business Trip Special Leave

An employee who travel long hours and return to work on Sunday will be granted 1 day leave (paid).

Family Care Leave

In the case that certain requirements are fulfilled, an employee may take up to 365 days offamily care leave in total per family member needing care.

Based on the “Act on Advancement of Measures to Support Raising
Next-Generation Children”, we are working to improve theemployment environment and diverse labor conditions so that
employees can fully demonstrate their capabilities while balancing
childcare and work. We also encourage male employees to participate
in childcare by providing paid paternity leave. In recognition of these
initiatives, we were granted Next Generation Accreditation Mark (asknown as Kurumin) by the Tokyo Labour
Bureau of the Ministry of Health, Labourand Welfare, as a company who supports
childcare well.

Promotion of Appropriate Work Hours
Workshop for work hours: We held workshops to learn
about the basics of working hours at meetings ofpersonnel managers and labor union training sessions.
● Introduction of new system for work management:
We have introduced a new system that enables
timely monitoring and visualization of working hours
and remaining annual leave.
●

Countermeasures against Harassment
Countermeasures against harassment related to pregnancy, childbirth, childcare leave, family care leave, etc., sexual harassment and power harassment
Three types of harassment are subject to disciplinary action in our rule of employment.
● We post explanatory materials and consultation services on our intranet to enable employees to access and consult with us at any time.
● Since 2013, we have introduced training for obtaining basic knowledge on power harassment as part of the training before promotion to A3 class (positions equivalent to teamleaders at plant). More than 100 employees have undergone this training.
●

73

Nissan Chemical Corporation Integrated Report 2018●

Support Raising Next-Generation Children

Systems for Promoting a Good Work-Life balanceName2018 Certified Health and Productivity Management Organization
Recognition Program (White 500)
In February 2018, we have been recognized under the 2018
Certified Health and Productivity Management Organization
Recognition Program (White 500) for two consecutive years.

The members of this committee are selected from the Company, the Nissan
Chemical Health Insurance Association, and the Nissan Chemical Labor Union,
two from each, and meet regularly to discuss health promotion measures. The
committee met four times in FY2017.

Regular Health Checkup●●

We are reinforcing guidance for the preparatory group for diabetes and specific healthguidance in cooperation with Nissan Chemical Health Insurance Association.

Mental Health Measures
We carry out stress check, analyze its results and give feedback to employees.
We also conduct training as necessary based on the results.
● Implementation of stress check: undergone by 100% of all employee● Organizational analysis of stress check and reporting session: A total twelve
reporting sessions were held for executives at the head office, laboratories andplants. The analysis and holding of reporting sessions were outsourced to an
external specialty company.
● Training: self-care training was provided four times to new employees andthose who had never undergone the training.*2●

Health Promotion Committee●

Prevention of Sever Disease

We encourage employees to undergo regular health checkups by targeting a
rate of 100%. We achieved the target rate of 100%*1 in FY2017.

*1 Employees on temporary retirement, etc. are excluded.

*2 Care that can be provided to oneself. It includes being aware of one’s own stress and preventing or coping with stress.

Labor-Management Relationship Based on Open Dialogue and Mutual Understanding
Nissan Chemical and the Nissan Chemical Labor Union have built a good relationship based on mutual understanding and trust. They strive to improve labor
conditions and develop systems through discussions as good partners to the management by taking a range of measures, including holding periodic meetings
for reporting business results and initiatives for better work-life balance.
All non-managerial employees, excluding those who have concluded a special agreement with the Company, belong to the Nissan Chemical Labor Union.
The number of its member is 1,465 (including those from some affiliates).
Name of the meeting

Content

Central Management Advisory Council

The policies and financial results of the Company are explained by the management to the labor union members.

Business Location Management
Advisory Council

1) Explanation of the contents of the Central Management Advisory Council
2) Discussions about problems that are specific to each business location

Number of meetings held in FY2017
2

Number of participants per meeting
Company: 6 Labor union: 7

Differs among
business locations

Executives of the business location
Executives of the labor union branch

Dialogue activities

Management and general union members set opportunities to have open dialogues. Union
members can discuss issues and problems of their own workplaces directly with the management.

3

Company: 3
Labor union: slightly more than 10

Labor-Management
Committee

The Personnel Department and executive members of the labor union regularly
exchange opinions about a wide range of problems and hold discussions to solve issues.

9Company: 3
Labor union: 7

Two each are selected from the Company, the health insurance association, and the labor union as its
members, who discuss measures for promoting good health among employees and other issues.

4Company: 2 Health insurance union: 2
Labor union: 2

Health Promotion Committee

Nissan Chemical Corporation Integrated Report 201874

C o m muni cat i on with So c ie tyAwards Program

HealthEvery year we grant awards to employees who have made beneficial inventions, devised improvement measures, or made remarkable achievements and contributions. Regarding intellectual properties, we also reward
excellent inventions selected from among patent-pending inventions at an early stage in an effort to create greater incentive for R&D, discover excellent inventions and improve upon their quality and creativity.

We have promoted mental and physical health initiatives based on the belief that employees’ health is a “foundation that supports sound corporate growth”. In 2018,
we have established a Basic Health Policy with the aim of maintaining and improving the health of our employees.
Concretely, we are implementing measures for lifestyle-related diseases, mental health care, and quitting smoking to promote the health of our employees incooperation with the health insurance association.

FY2017 Award (Award-winning projects: FY2016)
Name

Presenter

Content

Number of awards Number of rewarded

Central Awards
Division Awards
Office Awards

President and CEO
Head of each division
Head of each officeCommend employees who have made beneficial
inventions, devised improvement measures, or maderemarkable achievements and contributions.

1
2
3

5
19
18

Rewards for
Excellent
Inventions

Officer in chargeof Intellectual
Property Department

Reward excellent inventions at an early stage topromote the improvement of R&D capabilities. Rank S
rewards are granted to more excellent inventions.

18(Rank S:
3 inventions)58

Basic Health Policy
Mental and physical health is a foundation that supports sound corporate growth from the viewpoint of the happiness of employees and their families, as well as
the trust of the corporate and the smooth operation of the business. We and our employees will work together to promote initiatives aimed at maintaining andpromoting health in a multifaceted manner and aim to be a dynamic company.
1. Employees’ health is based on their own management and we will provide support.
2. We will implement effective and flexible measures through smooth internal and external cooperation.
3. We will ensure the proper use and management of personal information and comply with laws and regulations.

▲Central Awards presentation ceremony

Creation of a Comfortable Workplace
We have introduced a wide variety of programs and measures that enable employees to work in a highly productive manner and achieve a good work-life balance.
In addition to maintaining the high rate of employees taking annual leave of 70% or more in recent years, we are also aiming to support more efficient ways ofworking and taking time off. For example, we have decided to implement a new hourly leave system by the end of FY2018.

Content

Flextime

This system has been introduced at the head office and laboratories.

Childcare Leave

In the case that certain requirements are fulfilled, an employee may take childcare leave until
his or her child is two years old or until the coming April 20 after the child’s first birthday.

Paternity Leave

A male employee whose spouse gave birth to a child may take up to seven days of paternity
leave (paid) within eight weeks of the child’s birth.

Nursing Care Leave

An employee may use up to 20 days per year of annual leave which has been saved up forchildcare or spousal care and which is no longer valid.

Shorter Working Hours

Specified working hours may be shortened by units of 30 minutes and by up to 120 minutes
for looking after children in third grade (elementary school) or younger.

Half-day Leave

An employee may take annual leave by units of half days, with an upper limit of 30 times per year.

Planned Leave

We recommended 2days of company-wide planned leave and 3days of individual planned leave annually.

Hourly Annual Leave (introduced in November 2018)

An employee may take hourly annual leave up to 24 hours.

Annual Leave Accumulation

An employee may save up a maximum of 40 days of annual leave that are invalid and use them as medical leave,
leave for their own sickness, to look after elderly or sick family members or for other similar purposes.

Refreshment Leave

An employee may take ten consecutive days of leave (paid) after becoming 50 years old. Financial aid is also granted.

Re-employment Refreshment Leave

An employee may take three consecutive days of leave (paid) before or after their mandatory retirement.

Overseas Business Trip Special Leave

An employee who travel long hours and return to work on Sunday will be granted 1 day leave (paid).

Family Care Leave

In the case that certain requirements are fulfilled, an employee may take up to 365 days offamily care leave in total per family member needing care.

Based on the “Act on Advancement of Measures to Support Raising
Next-Generation Children”, we are working to improve theemployment environment and diverse labor conditions so that
employees can fully demonstrate their capabilities while balancing
childcare and work. We also encourage male employees to participate
in childcare by providing paid paternity leave. In recognition of these
initiatives, we were granted Next Generation Accreditation Mark (asknown as Kurumin) by the Tokyo Labour
Bureau of the Ministry of Health, Labourand Welfare, as a company who supports
childcare well.

Promotion of Appropriate Work Hours
Workshop for work hours: We held workshops to learn
about the basics of working hours at meetings ofpersonnel managers and labor union training sessions.
● Introduction of new system for work management:
We have introduced a new system that enables
timely monitoring and visualization of working hours
and remaining annual leave.
●

Countermeasures against Harassment
Countermeasures against harassment related to pregnancy, childbirth, childcare leave, family care leave, etc., sexual harassment and power harassment
Three types of harassment are subject to disciplinary action in our rule of employment.
● We post explanatory materials and consultation services on our intranet to enable employees to access and consult with us at any time.
● Since 2013, we have introduced training for obtaining basic knowledge on power harassment as part of the training before promotion to A3 class (positions equivalent to teamleaders at plant). More than 100 employees have undergone this training.
●

73

Nissan Chemical Corporation Integrated Report 2018●

Support Raising Next-Generation Children

Systems for Promoting a Good Work-Life balanceName2018 Certified Health and Productivity Management Organization
Recognition Program (White 500)
In February 2018, we have been recognized under the 2018
Certified Health and Productivity Management Organization
Recognition Program (White 500) for two consecutive years.

The members of this committee are selected from the Company, the Nissan
Chemical Health Insurance Association, and the Nissan Chemical Labor Union,
two from each, and meet regularly to discuss health promotion measures. The
committee met four times in FY2017.

Regular Health Checkup●●

We are reinforcing guidance for the preparatory group for diabetes and specific healthguidance in cooperation with Nissan Chemical Health Insurance Association.

Mental Health Measures
We carry out stress check, analyze its results and give feedback to employees.
We also conduct training as necessary based on the results.
● Implementation of stress check: undergone by 100% of all employee● Organizational analysis of stress check and reporting session: A total twelve
reporting sessions were held for executives at the head office, laboratories andplants. The analysis and holding of reporting sessions were outsourced to an
external specialty company.
● Training: self-care training was provided four times to new employees andthose who had never undergone the training.*2●

Health Promotion Committee●

Prevention of Sever Disease

We encourage employees to undergo regular health checkups by targeting a
rate of 100%. We achieved the target rate of 100%*1 in FY2017.

*1 Employees on temporary retirement, etc. are excluded.

*2 Care that can be provided to oneself. It includes being aware of one’s own stress and preventing or coping with stress.

Labor-Management Relationship Based on Open Dialogue and Mutual Understanding
Nissan Chemical and the Nissan Chemical Labor Union have built a good relationship based on mutual understanding and trust. They strive to improve labor
conditions and develop systems through discussions as good partners to the management by taking a range of measures, including holding periodic meetings
for reporting business results and initiatives for better work-life balance.
All non-managerial employees, excluding those who have concluded a special agreement with the Company, belong to the Nissan Chemical Labor Union.
The number of its member is 1,465 (including those from some affiliates).
Name of the meeting

Content

Central Management Advisory Council

The policies and financial results of the Company are explained by the management to the labor union members.

Business Location Management
Advisory Council

1) Explanation of the contents of the Central Management Advisory Council
2) Discussions about problems that are specific to each business location

Number of meetings held in FY2017
2

Number of participants per meeting
Company: 6 Labor union: 7

Differs among
business locations

Executives of the business location
Executives of the labor union branch

Dialogue activities

Management and general union members set opportunities to have open dialogues. Union
members can discuss issues and problems of their own workplaces directly with the management.

3

Company: 3
Labor union: slightly more than 10

Labor-Management
Committee

The Personnel Department and executive members of the labor union regularly
exchange opinions about a wide range of problems and hold discussions to solve issues.

9Company: 3
Labor union: 7

Two each are selected from the Company, the health insurance association, and the labor union as its
members, who discuss measures for promoting good health among employees and other issues.

4Company: 2 Health insurance union: 2
Labor union: 2

Health Promotion Committee

Nissan Chemical Corporation Integrated Report 201874

Financial Section
Financial Review

Financial Review of the Year Ended March 31, 2018

Overview

Operating Results

The domestic economy for the current consolidated fiscal year

As a result, the Company’s results for the current fiscal year

Total liabilities as of March 31, 2018 was 72,678 million yen(April 1, 2017 to March 31, 2018) continued to recover moder-were net sales 193,389 million yen (an increase of 131million(an increase of 4,637 million yen) due to increases in notes andately as corporate earnings improvement, capital investmentyen), operating income 34,988 million yen (an increase of 3,550

accounts payable-trade.

and consumer spending recovery amid the expansion of themillion yen) and ordinary income 36,235 million yen (anglobal economy. Under such circumstance, in the Chemicals

increase of 4,521 million yen), and net income attributable toincrease of 12,657 million yen). As a result, the equity ratio wasfinancing activities for the consolidated fiscal year ended March

Segment, sales of Basic Chemicals whereas and Fine Chemi-

owners of parent 27,142 million yen (an increase of 3,116

70.1% (an increase of 0.2 point).

31, 2018 was 20,268 million yen (19,042 million yen for thecals decreased from the same period of the previous year. In

million yen). Operating income and ordinary income reachedthe Performance Materials Segment, sales of Display Materials,

record highs for the fourth consecutive year and net income

Semiconductor Materials and Inorganic Materials increased. In

attributable to owners of parent for the fifth consecutive year.

the Agricultural Chemicals Segment, shipments of active

ment securities.

ingredients for veterinary pharmaceuticals increased. In the

Financial Position

Pharmaceutical Segment, the domestic sales of “LIVALO”

Total assets as of March 31, 2018 was 249,043 million yen (an(anti-cholesterol drug) decreased due to expansion of genericincrease of 17,294 million yen from the previous year) due to

products.

increases in notes and accounts receivable-trade and invest-

Operating Income (Millions of Yen)

34,98835,000Net Income per Share (Yen)

Total Assets (Millions of Yen)

200

250,000

31,43830,00028,60625,34725,000231,748
223,854 228,169

156.97

207,999

the previous year).

Net assets as of March 31, 2018 was 176,364 million yen (anrepayment of long-term loans payable, net cash used inprevious year).

Position of Cash Flow

As a result, cash and cash equivalents for the consolidated

Deducting income taxes paid from income before income taxes

fiscal year ended March 31, 2018 was 37,702 million yen

and non-controlling interests, depreciation and changes in(35,701 million yen for the previous year), reflecting 177 million

working capital, net cash provided by operating activities for the

yen effect of exchange rate changes. It increased by 2,000

consolidated fiscal year ended March 31, 2018 was 37,691

million yen compared to the previous year.

million yen (32,491 million yen for the previous year).
Due to mainly investment in plant and equipment, net cash

70

65.7

66.9

68.1

Capital Expenditures (Millions of Yen)
Depreciation Expense (Millions of Yen)

Dividends per Share (Yen)

69.9

70.1

68

70

60

60

52
50

50

22,24644113.9920,000100

150,000

102.11

15,00014,29915,000100,000

40

40

30

30

13,694

12,500200,000

143.37150

March 31, 2018 was 15,244 million yen (13,152 million yen for
Due to share repurchase, payment of dividends andEquity Ratio (%)
Return on Equity (%)

249,043

180.30used in investing activities for the consolidated fiscal year ended

36
30

10,000

9,796

10,2459,684

8,786
8,515 8,452

10,510
8,889

7,500

5,000
10,00020

50
50,000

75

12.7

15.1

16.1

10

5,000

0

12.7

14.6

FY2013 FY2014 FY2015 FY2016 FY2017

Nissan Chemical Corporation Integrated Report 2018

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

20
2,500

10

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

Nissan Chemical Corporation Integrated Report 201876

Financial Section
Financial Review

Financial Review of the Year Ended March 31, 2018

Overview

Operating Results

The domestic economy for the current consolidated fiscal year

As a result, the Company’s results for the current fiscal year

Total liabilities as of March 31, 2018 was 72,678 million yen(April 1, 2017 to March 31, 2018) continued to recover moder-were net sales 193,389 million yen (an increase of 131million(an increase of 4,637 million yen) due to increases in notes andately as corporate earnings improvement, capital investmentyen), operating income 34,988 million yen (an increase of 3,550

accounts payable-trade.

and consumer spending recovery amid the expansion of themillion yen) and ordinary income 36,235 million yen (anglobal economy. Under such circumstance, in the Chemicals

increase of 4,521 million yen), and net income attributable toincrease of 12,657 million yen). As a result, the equity ratio wasfinancing activities for the consolidated fiscal year ended March

Segment, sales of Basic Chemicals whereas and Fine Chemi-

owners of parent 27,142 million yen (an increase of 3,116

70.1% (an increase of 0.2 point).

31, 2018 was 20,268 million yen (19,042 million yen for thecals decreased from the same period of the previous year. In

million yen). Operating income and ordinary income reachedthe Performance Materials Segment, sales of Display Materials,

record highs for the fourth consecutive year and net income

Semiconductor Materials and Inorganic Materials increased. In

attributable to owners of parent for the fifth consecutive year.

the Agricultural Chemicals Segment, shipments of active

ment securities.

ingredients for veterinary pharmaceuticals increased. In the

Financial Position

Pharmaceutical Segment, the domestic sales of “LIVALO”

Total assets as of March 31, 2018 was 249,043 million yen (an(anti-cholesterol drug) decreased due to expansion of genericincrease of 17,294 million yen from the previous year) due to

products.

increases in notes and accounts receivable-trade and invest-

Operating Income (Millions of Yen)

34,98835,000Net Income per Share (Yen)

Total Assets (Millions of Yen)

200

250,000

31,43830,00028,60625,34725,000231,748
223,854 228,169

156.97

207,999

the previous year).

Net assets as of March 31, 2018 was 176,364 million yen (anrepayment of long-term loans payable, net cash used inprevious year).

Position of Cash Flow

As a result, cash and cash equivalents for the consolidated

Deducting income taxes paid from income before income taxes

fiscal year ended March 31, 2018 was 37,702 million yen

and non-controlling interests, depreciation and changes in(35,701 million yen for the previous year), reflecting 177 million

working capital, net cash provided by operating activities for the

yen effect of exchange rate changes. It increased by 2,000

consolidated fiscal year ended March 31, 2018 was 37,691

million yen compared to the previous year.

million yen (32,491 million yen for the previous year).
Due to mainly investment in plant and equipment, net cash

70

65.7

66.9

68.1

Capital Expenditures (Millions of Yen)
Depreciation Expense (Millions of Yen)

Dividends per Share (Yen)

69.9

70.1

68

70

60

60

52
50

50

22,24644113.9920,000100

150,000

102.11

15,00014,29915,000100,000

40

40

30

30

13,694

12,500200,000

143.37150

March 31, 2018 was 15,244 million yen (13,152 million yen for
Due to share repurchase, payment of dividends andEquity Ratio (%)
Return on Equity (%)

249,043

180.30used in investing activities for the consolidated fiscal year ended

36
30

10,000

9,796

10,2459,684

8,786
8,515 8,452

10,510
8,889

7,500

5,000
10,00020

50
50,000

75

12.7

15.1

16.1

10

5,000

0

12.7

14.6

FY2013 FY2014 FY2015 FY2016 FY2017

Nissan Chemical Corporation Integrated Report 2018

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

20
2,500

10

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

0

FY2013 FY2014 FY2015 FY2016 FY2017

Nissan Chemical Corporation Integrated Report 201876

Consolidated Balance Sheets
For FY2017 and FY2016(Thousands of
U.S. dollars)(Millions of Yen)

Assets

FY2017

Liabilities

FY2017FY2016

Current assets

FY2017FY2016FY2017¥ 18,579¥ 14,943$ 174,828

Short-term loans payable

23,591

23,155

221,991

Current Liabilities¥ 37,702¥ 35,701$ 354,776

Notes and accounts receivable - trade65,42260,075615,621

Merchandise and finished goods

29,85528,602

280,935

115

64

1,082

Current portion of long-term loans payable

2,554

3,070

24,033

Raw materials and supplies

7,797

7,778

73,370

Income taxes payable

5,156

3,288

48,518

Accounts receivable - other

1,831

2,379

17,230

Provision for bonuses

2,011

1,920

18,923

Short-term loans receivable

494

1,065

4,649

Deferred tax assets

3,019

2,708

28,409Provision for directors’ bonuses

27

28

254

Other

2,422

2,221

22,791Other

10,950

11,259103,039

(34)

(33)

(320)

Total current liabilities

62,871

57,665591,616

148,626

140,564

1,398,570

Non-current liabilities
Long-term loans payable

2,446

4,580

23,017

Deferred tax liabilities

4,341

2,649

40,849Provision for business structure improvement

516

594

4,856

Cash and deposits

Work in process

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

Notes and accounts payable - trade

63,98562,253602,098

Accumulated depreciation and impairment loss

(39,573)(38,428)(372,382)

Buildings and structures, net

24,411

23,824

229,707

Provision for loss on business of subsidiaries and affiliates

309

309

2,908

Machinery, equipment and vehicles

125,451

120,540

1,180,493

Net defined benefit liability

126

101

1,186

Accumulated depreciation and impairment loss

(112,434)(109,038)(1,058,003)

2,068

2,141

19,46013,017

11,502

122,490

Other

Machinery, equipment and vehicles, net

37,32335,717351,209

Total non-current liabilities

9,807

10,37692,284(32,261)(30,880)(303,576)

72,67868,041

683,900

5,061

4,837

47,624

9,047

9,198

85,132

22

103

207

Accumulated depreciation

(22)

(90)

(207)

Leased assets, net

0

12

0

Construction in progress

2,936

2,594

27,628

Capital stock

18,942

18,942

178,244

Total property, plant and equipment

54,47351,969512,591

Capital surplus

13,613

13,611

128,098

Retained earnings

133,822

126,370

1,259,264

Treasury shares(5,962)(7,587)(56,102)

Total shareholders’ equity

160,416

151,337

1,509,514

13,653

10,079128,475

Buildings and structures

Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets

Intangible assets
Software

775

610

7,293

Other

993

966

9,344

Total intangible assets

1,768

1,577

16,63738,51732,465362,445

Investments and other assets
Investment securities

Total liabilities

Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

115

125

1,082

Foreign currency translation adjustment

125

243

1,176

Net defined benefit asset

2,193

1,987

20,636

Other

3,440

3,156

32,370Remeasurements of defined benefit plans

390

380

3,670

(92)

(98)

(866)

14,17010,703

133,340

44,174

37,636415,677

1,778

1,666

16,731

100,416

91,183944,914

Total net assets

176,364

163,707

1,659,584¥249,043¥231,748$2,343,493

Total liabilities and net assets¥249,043¥231,748$2,343,493

Deferred tax assets

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

77(Thousands of
U.S. dollars)(Millions of Yen)

Nissan Chemical Corporation Integrated Report 2018

Total Accumulated other comprehensive income
Non-controlling interests

Nissan Chemical Corporation Integrated Report 201878

Consolidated Balance Sheets
For FY2017 and FY2016(Thousands of
U.S. dollars)(Millions of Yen)

Assets

FY2017

Liabilities

FY2017FY2016

Current assets

FY2017FY2016FY2017¥ 18,579¥ 14,943$ 174,828

Short-term loans payable

23,591

23,155

221,991

Current Liabilities¥ 37,702¥ 35,701$ 354,776

Notes and accounts receivable - trade65,42260,075615,621

Merchandise and finished goods

29,85528,602

280,935

115

64

1,082

Current portion of long-term loans payable

2,554

3,070

24,033

Raw materials and supplies

7,797

7,778

73,370

Income taxes payable

5,156

3,288

48,518

Accounts receivable - other

1,831

2,379

17,230

Provision for bonuses

2,011

1,920

18,923

Short-term loans receivable

494

1,065

4,649

Deferred tax assets

3,019

2,708

28,409Provision for directors’ bonuses

27

28

254

Other

2,422

2,221

22,791Other

10,950

11,259103,039

(34)

(33)

(320)

Total current liabilities

62,871

57,665591,616

148,626

140,564

1,398,570

Non-current liabilities
Long-term loans payable

2,446

4,580

23,017

Deferred tax liabilities

4,341

2,649

40,849Provision for business structure improvement

516

594

4,856

Cash and deposits

Work in process

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

Notes and accounts payable - trade

63,98562,253602,098

Accumulated depreciation and impairment loss

(39,573)(38,428)(372,382)

Buildings and structures, net

24,411

23,824

229,707

Provision for loss on business of subsidiaries and affiliates

309

309

2,908

Machinery, equipment and vehicles

125,451

120,540

1,180,493

Net defined benefit liability

126

101

1,186

Accumulated depreciation and impairment loss

(112,434)(109,038)(1,058,003)

2,068

2,141

19,46013,017

11,502

122,490

Other

Machinery, equipment and vehicles, net

37,32335,717351,209

Total non-current liabilities

9,807

10,37692,284(32,261)(30,880)(303,576)

72,67868,041

683,900

5,061

4,837

47,624

9,047

9,198

85,132

22

103

207

Accumulated depreciation

(22)

(90)

(207)

Leased assets, net

0

12

0

Construction in progress

2,936

2,594

27,628

Capital stock

18,942

18,942

178,244

Total property, plant and equipment

54,47351,969512,591

Capital surplus

13,613

13,611

128,098

Retained earnings

133,822

126,370

1,259,264

Treasury shares(5,962)(7,587)(56,102)

Total shareholders’ equity

160,416

151,337

1,509,514

13,653

10,079128,475

Buildings and structures

Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets

Intangible assets
Software

775

610

7,293

Other

993

966

9,344

Total intangible assets

1,768

1,577

16,63738,51732,465362,445

Investments and other assets
Investment securities

Total liabilities

Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

115

125

1,082

Foreign currency translation adjustment

125

243

1,176

Net defined benefit asset

2,193

1,987

20,636

Other

3,440

3,156

32,370Remeasurements of defined benefit plans

390

380

3,670

(92)

(98)

(866)

14,17010,703

133,340

44,174

37,636415,677

1,778

1,666

16,731

100,416

91,183944,914

Total net assets

176,364

163,707

1,659,584¥249,043¥231,748$2,343,493

Total liabilities and net assets¥249,043¥231,748$2,343,493

Deferred tax assets

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

77(Thousands of
U.S. dollars)(Millions of Yen)

Nissan Chemical Corporation Integrated Report 2018

Total Accumulated other comprehensive income
Non-controlling interests

Nissan Chemical Corporation Integrated Report 201878

Consolidated Statements of Income /Consolidated Statements of Comprehensive Income

Consolidated Statements of Changes in Net Assets
For FY2017

For FY2017 and FY2016(Millions of Yen)
Total shareholders’ equity

Consolidated Statements of Income
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in earnings of affiliates
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on disposal of non-current assets
Plant stop losses
Impairment loss
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Extraordinary losses
Income before income taxes and non-controlling interests
Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2016FY2017¥193,389
113,51379,87644,88734,988¥180,289
105,916
74,37242,93431,438$1,819,789
1,068,157
751,633
422,386
329,237

26
817
1,324
768
2,937

20
726
701
805
2,253

245
7,688
12,4597,227
27,637

126
591
270
−
460
240
1,690
36,235−−36,235
9,146
(214)
8,932
27,302159¥ 27,142

156
601
274
220
314
411
1,978
31,713−−31,713
7,439
81
7,520
24,192166¥ 24,026

1,186
5,561
2,541
−
4,329
2,258
15,903340,971−−
340,971
86,064(2,014)84,050256,9121,496$ 255,406

Capital stock

Balance at beginning of current period¥18,942

Capital surplus Retained earnings Treasury shares¥13,611¥126,370¥(7,587)

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of affiliates accounted for using equity method
Total other comprehensive income
Comprehensive income(Comprehensive income attribute to)
Owners of parent
Non-controlling interests

79

Nissan Chemical Corporation Integrated Report 2018

(Thousands of
U.S. Dollars)(Millions of Yen)FY2017FY2016FY2017¥27,302¥24,192$256,912

3,575
(124)
10
(1)
3,460
30,763

(436)
188
(174)
1
(420)
23,77133,641(1,167)94(9)32,559289,480

23,584
186

288,030$ 1,440

30,609153¥¥¥151,337

Changes of items during period
Dividends of surplus(9,063)(9,063)

Net income attributable to owners of parent

27,142

27,142

Share repurchase(10,627)

Cancellation of treasury shares
Change in treasury shares of parent arising from transactions with non(9,002)(9,002)

10,627−2

2

controlling shareholders
Net changes of items other than shareholders’ equity
Total changes of items during period

−

2

7,452

1,624

9,078

¥18,942¥13,613¥133,822¥(5,962)¥160,416

Total
Valuation
accumulateddifference on Foreign currency Remeasurements
otheravailable-for-saletranslationof defined benefit comprehensive
securities
adjustment
plansincomeNon-controllinginterests

Total
net assets¥10,703¥1,666¥163,707

Balance at end of current period

Accumulated other comprehensive income

Balance at beginning of current period¥10,079

¥243

¥380

Changes of items during period
Dividends of surplus(9,063)

Net income attributable to owners of parent

27,142

Share repurchase(9,002)

Cancellation of treasury shares

Consolidated Statements of Comprehensive Income

Total
shareholders’equity−Change in treasury shares of parent arising from transactions with non2

controlling shareholders
Net changes of items other than shareholders’ equity
Total changes of items during period
Balance at end of current period

3,574

(118)

10

3,466

111

3,578

3,574

(118)

10

3,466

111

12,657¥13,653

¥125

¥390

¥14,170¥1,778¥176,364

Nissan Chemical Corporation Integrated Report 201880

Consolidated Statements of Income /Consolidated Statements of Comprehensive Income

Consolidated Statements of Changes in Net Assets
For FY2017

For FY2017 and FY2016(Millions of Yen)
Total shareholders’ equity

Consolidated Statements of Income
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in earnings of affiliates
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on disposal of non-current assets
Plant stop losses
Impairment loss
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Extraordinary losses
Income before income taxes and non-controlling interests
Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2016FY2017¥193,389
113,51379,87644,88734,988¥180,289
105,916
74,37242,93431,438$1,819,789
1,068,157
751,633
422,386
329,237

26
817
1,324
768
2,937

20
726
701
805
2,253

245
7,688
12,4597,227
27,637

126
591
270
−
460
240
1,690
36,235−−36,235
9,146
(214)
8,932
27,302159¥ 27,142

156
601
274
220
314
411
1,978
31,713−−31,713
7,439
81
7,520
24,192166¥ 24,026

1,186
5,561
2,541
−
4,329
2,258
15,903340,971−−
340,971
86,064(2,014)84,050256,9121,496$ 255,406

Capital stock

Balance at beginning of current period¥18,942

Capital surplus Retained earnings Treasury shares¥13,611¥126,370¥(7,587)

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of affiliates accounted for using equity method
Total other comprehensive income
Comprehensive income(Comprehensive income attribute to)
Owners of parent
Non-controlling interests

79

Nissan Chemical Corporation Integrated Report 2018

(Thousands of
U.S. Dollars)(Millions of Yen)FY2017FY2016FY2017¥27,302¥24,192$256,912

3,575
(124)
10
(1)
3,460
30,763

(436)
188
(174)
1
(420)
23,77133,641(1,167)94(9)32,559289,480

23,584
186

288,030$ 1,440

30,609153¥¥¥151,337

Changes of items during period
Dividends of surplus(9,063)(9,063)

Net income attributable to owners of parent

27,142

27,142

Share repurchase(10,627)

Cancellation of treasury shares
Change in treasury shares of parent arising from transactions with non(9,002)(9,002)

10,627−2

2

controlling shareholders
Net changes of items other than shareholders’ equity
Total changes of items during period

−

2

7,452

1,624

9,078

¥18,942¥13,613¥133,822¥(5,962)¥160,416

Total
Valuation
accumulateddifference on Foreign currency Remeasurements
otheravailable-for-saletranslationof defined benefit comprehensive
securities
adjustment
plansincomeNon-controllinginterests

Total
net assets¥10,703¥1,666¥163,707

Balance at end of current period

Accumulated other comprehensive income

Balance at beginning of current period¥10,079

¥243

¥380

Changes of items during period
Dividends of surplus(9,063)

Net income attributable to owners of parent

27,142

Share repurchase(9,002)

Cancellation of treasury shares

Consolidated Statements of Comprehensive Income

Total
shareholders’equity−Change in treasury shares of parent arising from transactions with non2

controlling shareholders
Net changes of items other than shareholders’ equity
Total changes of items during period
Balance at end of current period

3,574

(118)

10

3,466

111

3,578

3,574

(118)

10

3,466

111

12,657¥13,653

¥125

¥390

¥14,170¥1,778¥176,364

Nissan Chemical Corporation Integrated Report 201880

Consolidated Statements of Changes in Net Assets
For FY2016

For FY2017(Thousands of
U.S. dollars)(Millions of Yen)
Total shareholders’ equity
Capital stock

Balance at beginning of current period¥18,942

Total shareholders’ equity

Capital surplus Retained earnings Treasury shares¥13,611¥115,878¥(4,281)

Total
shareholders’equity¥144,151

Balance at beginning of current period$178,244

Capital surplus Retained earnings Treasury shares

Total
shareholders’equity$128,079$1,424,080$1,189,141$(71,394)

Changes of items during period

Changes of items during period
Dividends of surplus(7,680)(7,680)

Dividends of surplus(85,283)(85,283)

Net income attributable to owners of parent

24,02624,026

Net income attributable to owners of parent

255,406

255,406

(157)

(157)

Share repurchase(9,002)(9,002)

Cancellation of treasury shares

0

0

5,695

−

Change in scope of consolidation
Share repurchase
Disposal of treasury shares

0Cancellation of treasury shares(0)(5,695)

Total changes of items during period

Change in treasury shares of parent arising from transactions with non(84,709)

100,000−
19

19

controlling shareholders−−

10,492(3,305)

7,186¥18,942¥13,611¥126,370¥(7,587)¥151,337

Total changes of items during period−

19

70,123

15,28285,424$178,244$128,098$1,259,264$(56,102)$1,509,514

Accumulated other comprehensive income

Accumulated other comprehensive income

Total
accumulated
Valuationother
difference on Foreign currency Remeasurements
translationof defined benefit comprehensive
available-for-saleadjustment
plansincomesecurities

Total
Valuation
accumulateddifference on Foreign currency Remeasurements
otheravailable-for-saletranslationof defined benefit comprehensive
securities
adjustment
plansincomeNon-controllinginterests

Total
net assets$15,677$1,540,482

Balance at end of current period

Balance at beginning of current period(100,000)(84,709)

Net changes of items other than shareholders’ equity

Net changes of items other than shareholders’ equity¥10,515

¥171

¥554

¥11,241

Non-controllinginterests

Total
net assets¥1,531¥156,924

Changes of items during period

Balance at end of current period

Balance at beginning of current period$ 94,843$2,287$3,576$100,715

Changes of items during period

Dividends of surplus(7,680)

Dividends of surplus(85,283)

Net income attributable to owners of parent

24,026

Net income attributable to owners of parent

255,406(84,709)

Change in scope of consolidation(157)

Share repurchase

Share repurchase(9,002)

Cancellation of treasury shares

Disposal of treasury shares

0Cancellation of treasury shares−controlling shareholders
Net changes of items other than shareholders’ equity

Net changes of items other than shareholders’ equity
Total changes of items during period
Balance at end of current period

81

Capital stock

Nissan Chemical Corporation Integrated Report 2018

(435)

72

(174)

(537)

134

(403)

(435)

72

(174)

(537)

134

6,782

¥10,079

¥243

¥380

¥10,703¥1,666¥163,707−

Change in treasury shares of parent arising from transactions with non

Total changes of items during period
Balance at end of current period

19
33,631(1,110)94

32,615

1,045

33,66933,631(1,110)94

32,615

1,045

119,102$128,475$1,176$3,670$133,340$16,731$1,659,584

Nissan Chemical Corporation Integrated Report 201882

Consolidated Statements of Changes in Net Assets
For FY2016

For FY2017(Thousands of
U.S. dollars)(Millions of Yen)
Total shareholders’ equity
Capital stock

Balance at beginning of current period¥18,942

Total shareholders’ equity

Capital surplus Retained earnings Treasury shares¥13,611¥115,878¥(4,281)

Total
shareholders’equity¥144,151

Balance at beginning of current period$178,244

Capital surplus Retained earnings Treasury shares

Total
shareholders’equity$128,079$1,424,080$1,189,141$(71,394)

Changes of items during period

Changes of items during period
Dividends of surplus(7,680)(7,680)

Dividends of surplus(85,283)(85,283)

Net income attributable to owners of parent

24,02624,026

Net income attributable to owners of parent

255,406

255,406

(157)

(157)

Share repurchase(9,002)(9,002)

Cancellation of treasury shares

0

0

5,695

−

Change in scope of consolidation
Share repurchase
Disposal of treasury shares

0Cancellation of treasury shares(0)(5,695)

Total changes of items during period

Change in treasury shares of parent arising from transactions with non(84,709)

100,000−
19

19

controlling shareholders−−

10,492(3,305)

7,186¥18,942¥13,611¥126,370¥(7,587)¥151,337

Total changes of items during period−

19

70,123

15,28285,424$178,244$128,098$1,259,264$(56,102)$1,509,514

Accumulated other comprehensive income

Accumulated other comprehensive income

Total
accumulated
Valuationother
difference on Foreign currency Remeasurements
translationof defined benefit comprehensive
available-for-saleadjustment
plansincomesecurities

Total
Valuation
accumulateddifference on Foreign currency Remeasurements
otheravailable-for-saletranslationof defined benefit comprehensive
securities
adjustment
plansincomeNon-controllinginterests

Total
net assets$15,677$1,540,482

Balance at end of current period

Balance at beginning of current period(100,000)(84,709)

Net changes of items other than shareholders’ equity

Net changes of items other than shareholders’ equity¥10,515

¥171

¥554

¥11,241

Non-controllinginterests

Total
net assets¥1,531¥156,924

Changes of items during period

Balance at end of current period

Balance at beginning of current period$ 94,843$2,287$3,576$100,715

Changes of items during period

Dividends of surplus(7,680)

Dividends of surplus(85,283)

Net income attributable to owners of parent

24,026

Net income attributable to owners of parent

255,406(84,709)

Change in scope of consolidation(157)

Share repurchase

Share repurchase(9,002)

Cancellation of treasury shares

Disposal of treasury shares

0Cancellation of treasury shares−controlling shareholders
Net changes of items other than shareholders’ equity

Net changes of items other than shareholders’ equity
Total changes of items during period
Balance at end of current period

81

Capital stock

Nissan Chemical Corporation Integrated Report 2018

(435)

72

(174)

(537)

134

(403)

(435)

72

(174)

(537)

134

6,782

¥10,079

¥243

¥380

¥10,703¥1,666¥163,707−

Change in treasury shares of parent arising from transactions with non

Total changes of items during period
Balance at end of current period

19
33,631(1,110)94

32,615

1,045

33,66933,631(1,110)94

32,615

1,045

119,102$128,475$1,176$3,670$133,340$16,731$1,659,584

Nissan Chemical Corporation Integrated Report 201882

Notes to Consolidated Financial Statements

Consolidated Statements of Cash FlowsFor FY2017 and FY2016(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2016FY2017

Income before income taxes and non-controlling interests¥36,235¥31,713$340,971

Depreciation

10,5108,889

98,899Impairment loss

−

220

−

Interest and dividend income

(844)

(746)

(7,942)

Interest expenses

126

156

1,186

Increase (decrease) in provision for business structure improvement

−

(86)

−

Cash flows from operating activities

591

601

5,561

Decrease (increase) in notes and accounts receivable - trade(5,266)(2,573)(49,553)

Decrease (increase) in inventories(1,309)2,054(12,318)

Increase (decrease) in notes and accounts payable - trade

3,494

(334)

32,879Loss (gain) on disposal of non-current assets

Other

(328)

(474)

(3,086)

Subtotal

43,20939,419406,596

Interest and dividend income received

1,881

2,175

17,700Interest expenses paid

(125)

(156)

(1,176)

Income taxes paid

(7,273)(8,947)(68,439)

Net cash provided by (used in) operating activities

37,69132,491

354,672

(759)

(787)

(7,142)

65

2,988

612

Cash flows from investing activities
Purchase of investment securities
Proceeds from sales of investment securities(13,768)(12,394)(129,557)

Payments for retirement of property, plant and equipment

(405)

(477)

(3,811)

Purchase of intangible assets(585)(1,091)(5,505)Net decrease (increase) in short-term loans receivable

546

(12)

5,138

Purchase of long-term prepaid expenses

(67)

(834)

(630)

Other

(270)

(542)

(2,541)(15,244)(13,152)(143,446)

Net increase (decrease) in short-term loans payable

501

220

4,714

Proceeds from long-term loans payable

420

550

3,952

Repayments of long-term loans payable(3,070)(3,060)(28,889)

Cash dividends paid

(9,063)(7,680)(85,283)

(39)

(52)

(367)

(9,002)(9,002)(84,709)

(14)

(17)

(132)

Purchase of property, plant and equipment

Net cash provided by (used in) investing activities
Cash flows from financing activities

Dividends paid to non-controlling interests
Share repurchaseOther(20,268)(19,042)(190,722)

Effect of exchange rate change on cash and cash equivalents

(177)

94

(1,666)

Net increase (decrease) in cash and cash equivalents

2,000

390

18,820Cash and cash equivalents at the beginning of period

35,70135,335335,946

−

(25)

−

¥37,702¥35,701$354,776

Net cash provided by (used in) financing activities

Decrease in cash and cash equivalents resulting from exclusion of subsidiaries from consolidation
Cash and cash equivalents at end of period

83

Nissan Chemical Corporation Integrated Report 2018

1. Basis for presenting Consolidated Financial Statements
The accompanying consolidated financial statements have been preparedin accordance with the provisions set forth in the Japanese Financial
Instruments and Exchange Act, the related accounting regulations, andthe accounting principles generally accepted in Japan (“J-GAAP”), which
differ in certain aspects from the application and disclosure requirementsof the accounting principles generally accepted in the United States ofAmerica (“US-GAAP”) and International Financial Reporting Standards(“IFRS”).
In preparing these consolidated financial statements, certain reclassification and rearrangements have been made to the consolidated financial
statements issued in Japan in order to present them in a form that is morefamiliar to readers in other countries.
2. Summary of Significant Accounting Policies
a. Consolidation
The consolidated financial statements as of March 31, 2018 include theaccount of Nissan Chemical Industries, Ltd. (the “Company”) and its eightmain (eight in FY2016) subsidiaries (together, the “Companies”). The
Company does not consolidate other subsidiaries due to their immateriality in terms of consolidated total assets, net sales, net income, andretained earnings.
Under the control or influence concept, those companies in which theCompany, either directly or indirectly, is able to exercise control over
operations are fully consolidated. Those companies over which theCompany has the ability to exercise significant influence are accounted
for by the equity method.
Investments in two affiliated companies (two in FY2016) are accounted
for by the equity method.
The assets and liabilities of the newly consolidated subsidiaries arestated at fair value as of the respective dates on which they wereacquired.
All significant inter-company balances and transactions have been
eliminated in consolidation.
All material unrealized profits included in assets resulting fromtransactions within the Companies are eliminated.
b. Securities
The Company’s marketable securities are reported at fair value.
Unrealized holding gains and losses, net of the related tax effect, on
marketable securities are excluded from earnings. Instead, they arereported as a separate component of other comprehensive income until
realized. Realized gains and losses for securities are included inearnings, and are derived using the moving average method for
determining the cost of securities sold.
Non-marketable securities in companies over which the Company isincapable of exercising significant influence are stated at cost andreviewed periodically for impairment.

c. Inventories
Inventories are stated at the lower of cost or net realizable value. The costis determined by the average method.
d. Property, Plant and Equipment (excluding Leased Assets)
Property, plant and equipment are stated at cost. In general, thedepreciation of property, plant and equipment is computed by the
declining-balance method over the estimated useful lives of these assets.
The estimated useful life ranges are two years to fifty years for buildings
and structures, and two years to twelve years for machinery and equipment.
e. Goodwill and other Intangible Assets
Goodwill is amortized by the straight-line method within 20 years. Other
intangible assets are also amortized the using straight-line method.
The most typical intangible asset is Software, and its useful life is five
years.
f. Leased Assets
Leased assets arising from finance lease transactions which do nottransfer ownership to the lessee are depreciated to a residual value ofzero by the straight-line method, using the contract term as the useful life.
g. Allowance for Doubtful Accounts
The allowance for doubtful accounts is the Companies’ best estimate forthe amount of probable credit losses in the Companies’ existing tradereceivables.
An additional reserve for individual receivable is recorded when the
Companies’ become aware of a customer’s inability to meet its financial
obligations, such as when a customer files for bankruptcy or when the its
operating results or financial position deteriorates.
If the customer’s circumstances change, estimates of the recoverabilityof receivables are further adjusted.
h. Provision for Bonuses
The Companies provide accrued bonuses for employees based on theestimated amounts to be paid for the fiscal year.
i. Provision for Directors’ Bonuses
The Companies provide accrued bonuses for members of the Board of
Directors based on the estimated amounts to be paid for the fiscal year.
j. Provision for Business Structure Improvement
The Company provides a reserve at the estimated amount to cover the
expenses and losses to be incurred in association with structural
improvement.
k. Provision for Loss on Business of Subsidiaries and Affiliates
The Company provides a reserve at the estimated amount to cover thelosses on business of subsidiaries and affiliates in consideration of theirfinancial position.

Nissan Chemical Corporation Integrated Report 201884

Notes to Consolidated Financial Statements

Consolidated Statements of Cash FlowsFor FY2017 and FY2016(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2016FY2017

Income before income taxes and non-controlling interests¥36,235¥31,713$340,971

Depreciation

10,5108,889

98,899Impairment loss

−

220

−

Interest and dividend income

(844)

(746)

(7,942)

Interest expenses

126

156

1,186

Increase (decrease) in provision for business structure improvement

−

(86)

−

Cash flows from operating activities

591

601

5,561

Decrease (increase) in notes and accounts receivable - trade(5,266)(2,573)(49,553)

Decrease (increase) in inventories(1,309)2,054(12,318)

Increase (decrease) in notes and accounts payable - trade

3,494

(334)

32,879Loss (gain) on disposal of non-current assets

Other

(328)

(474)

(3,086)

Subtotal

43,20939,419406,596

Interest and dividend income received

1,881

2,175

17,700Interest expenses paid

(125)

(156)

(1,176)

Income taxes paid

(7,273)(8,947)(68,439)

Net cash provided by (used in) operating activities

37,69132,491

354,672

(759)

(787)

(7,142)

65

2,988

612

Cash flows from investing activities
Purchase of investment securities
Proceeds from sales of investment securities(13,768)(12,394)(129,557)

Payments for retirement of property, plant and equipment

(405)

(477)

(3,811)

Purchase of intangible assets(585)(1,091)(5,505)Net decrease (increase) in short-term loans receivable

546

(12)

5,138

Purchase of long-term prepaid expenses

(67)

(834)

(630)

Other

(270)

(542)

(2,541)(15,244)(13,152)(143,446)

Net increase (decrease) in short-term loans payable

501

220

4,714

Proceeds from long-term loans payable

420

550

3,952

Repayments of long-term loans payable(3,070)(3,060)(28,889)

Cash dividends paid

(9,063)(7,680)(85,283)

(39)

(52)

(367)

(9,002)(9,002)(84,709)

(14)

(17)

(132)

Purchase of property, plant and equipment

Net cash provided by (used in) investing activities
Cash flows from financing activities

Dividends paid to non-controlling interests
Share repurchaseOther(20,268)(19,042)(190,722)

Effect of exchange rate change on cash and cash equivalents

(177)

94

(1,666)

Net increase (decrease) in cash and cash equivalents

2,000

390

18,820Cash and cash equivalents at the beginning of period

35,70135,335335,946

−

(25)

−

¥37,702¥35,701$354,776

Net cash provided by (used in) financing activities

Decrease in cash and cash equivalents resulting from exclusion of subsidiaries from consolidation
Cash and cash equivalents at end of period

83

Nissan Chemical Corporation Integrated Report 2018

1. Basis for presenting Consolidated Financial Statements
The accompanying consolidated financial statements have been preparedin accordance with the provisions set forth in the Japanese Financial
Instruments and Exchange Act, the related accounting regulations, andthe accounting principles generally accepted in Japan (“J-GAAP”), which
differ in certain aspects from the application and disclosure requirementsof the accounting principles generally accepted in the United States ofAmerica (“US-GAAP”) and International Financial Reporting Standards(“IFRS”).
In preparing these consolidated financial statements, certain reclassification and rearrangements have been made to the consolidated financial
statements issued in Japan in order to present them in a form that is morefamiliar to readers in other countries.
2. Summary of Significant Accounting Policies
a. Consolidation
The consolidated financial statements as of March 31, 2018 include theaccount of Nissan Chemical Industries, Ltd. (the “Company”) and its eightmain (eight in FY2016) subsidiaries (together, the “Companies”). The
Company does not consolidate other subsidiaries due to their immateriality in terms of consolidated total assets, net sales, net income, andretained earnings.
Under the control or influence concept, those companies in which theCompany, either directly or indirectly, is able to exercise control over
operations are fully consolidated. Those companies over which theCompany has the ability to exercise significant influence are accounted
for by the equity method.
Investments in two affiliated companies (two in FY2016) are accounted
for by the equity method.
The assets and liabilities of the newly consolidated subsidiaries arestated at fair value as of the respective dates on which they wereacquired.
All significant inter-company balances and transactions have been
eliminated in consolidation.
All material unrealized profits included in assets resulting fromtransactions within the Companies are eliminated.
b. Securities
The Company’s marketable securities are reported at fair value.
Unrealized holding gains and losses, net of the related tax effect, on
marketable securities are excluded from earnings. Instead, they arereported as a separate component of other comprehensive income until
realized. Realized gains and losses for securities are included inearnings, and are derived using the moving average method for
determining the cost of securities sold.
Non-marketable securities in companies over which the Company isincapable of exercising significant influence are stated at cost andreviewed periodically for impairment.

c. Inventories
Inventories are stated at the lower of cost or net realizable value. The costis determined by the average method.
d. Property, Plant and Equipment (excluding Leased Assets)
Property, plant and equipment are stated at cost. In general, thedepreciation of property, plant and equipment is computed by the
declining-balance method over the estimated useful lives of these assets.
The estimated useful life ranges are two years to fifty years for buildings
and structures, and two years to twelve years for machinery and equipment.
e. Goodwill and other Intangible Assets
Goodwill is amortized by the straight-line method within 20 years. Other
intangible assets are also amortized the using straight-line method.
The most typical intangible asset is Software, and its useful life is five
years.
f. Leased Assets
Leased assets arising from finance lease transactions which do nottransfer ownership to the lessee are depreciated to a residual value ofzero by the straight-line method, using the contract term as the useful life.
g. Allowance for Doubtful Accounts
The allowance for doubtful accounts is the Companies’ best estimate forthe amount of probable credit losses in the Companies’ existing tradereceivables.
An additional reserve for individual receivable is recorded when the
Companies’ become aware of a customer’s inability to meet its financial
obligations, such as when a customer files for bankruptcy or when the its
operating results or financial position deteriorates.
If the customer’s circumstances change, estimates of the recoverabilityof receivables are further adjusted.
h. Provision for Bonuses
The Companies provide accrued bonuses for employees based on theestimated amounts to be paid for the fiscal year.
i. Provision for Directors’ Bonuses
The Companies provide accrued bonuses for members of the Board of
Directors based on the estimated amounts to be paid for the fiscal year.
j. Provision for Business Structure Improvement
The Company provides a reserve at the estimated amount to cover the
expenses and losses to be incurred in association with structural
improvement.
k. Provision for Loss on Business of Subsidiaries and Affiliates
The Company provides a reserve at the estimated amount to cover thelosses on business of subsidiaries and affiliates in consideration of theirfinancial position.

Nissan Chemical Corporation Integrated Report 201884

l. Provision for Retirement Benefits
The Company has a defined benefit plan and a retirement plan that
substantially covers all of its employees.
The method for calculating the estimated amount of all retirement
benefits to be paid at future retirement dates is based on the benefit
formula.
Actuarial gains and losses are primarily amortized using the decliningbalance method over the average of the estimated remaining service years(16 years) commencing from the period which the gains and losses occurred.
Certain consolidated subsidiaries use a simplified method for
calculating retirement benefits.
In this method, the retirement benefit obligation is the same amount as
the necessary payment related to retirement benefits.
m. Translation of Foreign Currency
The assets and liabilities of the Company’s subsidiaries located outside
Japan are translated into Japanese yen at the exchange rate in effect on
the balance sheet date. Revenue and expense items are translated at theprevailing average exchange rates for the year. Gains and losses resulting
from foreign currency transactions are included in other income(deductions), and those resulting from the translation of financial
statements are excluded from the statements of income. Instead, they are
accumulated in net assets as a component of accumulated othercomprehensive income (loss).
n. Derivatives and Hedge Accounting
The Company enters into interest rate swap contracts to hedge the risk ofchanges in interest rates over borrowings.
Derivatives are carried at fair value with all changes in unrealized gains
and losses charged to income, except for those which meet the criteria fordeferral hedge accounting under which unrealized gains or losses, net ofthe applicable income taxes, are reported as components of accumulated
other comprehensive income (loss).
If interest rates swap contracts meet certain criteria, the net amount tobe paid or received under the interest rate swap contract is added to or
deducted from the interest on the assets or liabilities for which the swap
contract is executed.
o. Cash and Cash Equivalent
The Companies consider cash equivalents include all highly fluid
investments, which have been purchased with original maturities of threemonths or less.

3. U.S. dollar Amounts
The accompanying consolidated financial statements are expressed inJapanese yen as of and for the year ended March 31, 2018 after being
converted from the currency of the country in which the Company
operates. The translation of Japanese yen amounts to United States
dollar amounts is included solely for the convenience of the readers
outside Japan, and has been made at the rate of ¥106.27 to US $1, whichis the approximate closing exchange rate reported by the Tokyo Foreign
Exchange Market on March 31, 2018. This translation should not be
construed to indicate that the Japanese yen amounts shown can beconverted to United States dollars at the above rate.
4. Unapplied Accounting Standards
Accounting Standards Board of Japan released “Accounting Standard for
Revenue Recognition” and “Implementation Guidance on AccountingStandard for Revenue Recognition” on March 30, 2018.
The Companies have not applied the above standard and guidance forthe current consolidated fiscal year.
The applying timing is under consideration.
The impact on consolidated financial statements is under evaluation aswell.
5. Collateral Assets and Liabilities
Collateral assets and liabilities as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017

Investment securities

FY2016¥ 97¥122

FY2017

7. Comprehensive Income(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016

Valuation difference on available-for-sale securities:¥5,200¥(582)

Reclassification adjustment

(29)

(47)

(273)

Amount before tax effect

5,170

(629)

48,650Tax effect(1,595)

192(15,009)

3,575

(436)

33,641

Gains (losses) arising during the year

Valuation difference on available-for-salesecurities, net of tax$48,932

Foreign currency translation adjustment:
(124)
−

188

(1,167)

Reclassification adjustment
Amount before tax effect

(124)

188

(1,167)

Gains (losses) arising during the year−

Tax effectForeign currency translation(124)

adjustment, net of tax

−
−

188

−

(1,167)

Remeasurements of defined benefit plans:
Gains (losses) arising during the year

88

(144)

828

Reclassification adjustment

(73)

(107)

(687)

Amount before tax effect

15

(252)

141

Tax effect

(4)

77

(38)

Remeasurements of defined benefit plans, net of tax 10

(174)

94

Share of other comprehensive income of affiliates accounted for using equity methods
¥340

¥253

$3,199Accrued expenses

¥−

¥ 0

$

−

6. Research and Development Expenses
Research and development expenses included in selling, general andadministrative expenses for FY2017 and FY2016 were as follows:(Millions of Yen)FY2017¥17,228(Thousands of
U.S. dollars)

FY2016FY2017¥16,078$162,115

Gains (losses) arising during the year
Total other comprehensive income

9. Investment Securities

(1)

1

(9)

¥3,460¥(420)$32,559

8. Common Shares(1) Dividends
Cash dividends charged to retained earnings for the years ended
March 31, 2018 and 2017 represent the dividends paid out during
those years. The accompanying consolidated financial statements do
not include any provisions for a dividend approved by the Annual
Shareholders Meeting of 36 yen per share with an aggregate 5,380
million yen for the year ended March 31, 2018.

FY2017¥24,031$282,507

Unlisted securities of affiliates

6,812

6,636

64,101

Unlisted securities

1,682

1,797

15,828¥38,517¥32,465$362,445

10. Short-term Debt and Long-term Debt
Short-term debt consisting of an unsecured bank overdraft as of March
31, 2018 was 23,591 million yen.
The weighted average interest rate on short-term debt outstanding asof March 31, 2018 was 0.56%.
The weighted average interest rate on long-term debt outstanding as ofMarch 31, 2018 was 0.77%.
The weighted average interest rate on the current portion of long-term
debt outstanding as of March 31, 2018 was 0.89%.
Long-term debt as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017Long-term debt
Less current portion¥5,000FY2017FY2016¥7,650$47,050(2,554)(3,070)(24,033)¥2,446¥4,580$23,017Long-term debt payments due after FY2018 were as follows:(Millions of Yen)

(Thousands of
U.S. dollars)

FY2019¥1,754$16,505

FY2020414

3,896

FY2021194

1,826

FY2022 and thereafter

Nissan Chemical Corporation Integrated Report 2018

FY2017FY2016¥30,022Equity securities

Year ending March 31

85(Thousands of
U.S. dollars)(Millions of Yen)−

$1,148

Accounts payable(2) Retained Earnings
Retained earnings on a consolidated basis consist of legal reserve andretained earnings. In accordance with provisions of the Companies Act ofJapan, the Company has provided a legal reserve as an appropriation ofretained earnings. The Code states that while neither legal capital surplus
nor legal retained earnings are available for dividends, both may be used
to reduce or eliminate a deficit by a resolution of the shareholders’meeting, or may be transferred to stated capital common stock by aresolution of the Board of Directors. Legal reserve in the accompanying
consolidated financial statement includes only that of the Company.
Retained earnings of the Company and its consolidated subsidiaries
include a certain special reserve for the purpose of obtaining tax benefitsin accordance with the Special Taxation Law of Japan.

84

790

¥2,446$23,017

Nissan Chemical Corporation Integrated Report 201886

l. Provision for Retirement Benefits
The Company has a defined benefit plan and a retirement plan that
substantially covers all of its employees.
The method for calculating the estimated amount of all retirement
benefits to be paid at future retirement dates is based on the benefit
formula.
Actuarial gains and losses are primarily amortized using the decliningbalance method over the average of the estimated remaining service years(16 years) commencing from the period which the gains and losses occurred.
Certain consolidated subsidiaries use a simplified method for
calculating retirement benefits.
In this method, the retirement benefit obligation is the same amount as
the necessary payment related to retirement benefits.
m. Translation of Foreign Currency
The assets and liabilities of the Company’s subsidiaries located outside
Japan are translated into Japanese yen at the exchange rate in effect on
the balance sheet date. Revenue and expense items are translated at theprevailing average exchange rates for the year. Gains and losses resulting
from foreign currency transactions are included in other income(deductions), and those resulting from the translation of financial
statements are excluded from the statements of income. Instead, they are
accumulated in net assets as a component of accumulated othercomprehensive income (loss).
n. Derivatives and Hedge Accounting
The Company enters into interest rate swap contracts to hedge the risk ofchanges in interest rates over borrowings.
Derivatives are carried at fair value with all changes in unrealized gains
and losses charged to income, except for those which meet the criteria fordeferral hedge accounting under which unrealized gains or losses, net ofthe applicable income taxes, are reported as components of accumulated
other comprehensive income (loss).
If interest rates swap contracts meet certain criteria, the net amount tobe paid or received under the interest rate swap contract is added to or
deducted from the interest on the assets or liabilities for which the swap
contract is executed.
o. Cash and Cash Equivalent
The Companies consider cash equivalents include all highly fluid
investments, which have been purchased with original maturities of threemonths or less.

3. U.S. dollar Amounts
The accompanying consolidated financial statements are expressed inJapanese yen as of and for the year ended March 31, 2018 after being
converted from the currency of the country in which the Company
operates. The translation of Japanese yen amounts to United States
dollar amounts is included solely for the convenience of the readers
outside Japan, and has been made at the rate of ¥106.27 to US $1, whichis the approximate closing exchange rate reported by the Tokyo Foreign
Exchange Market on March 31, 2018. This translation should not be
construed to indicate that the Japanese yen amounts shown can beconverted to United States dollars at the above rate.
4. Unapplied Accounting Standards
Accounting Standards Board of Japan released “Accounting Standard for
Revenue Recognition” and “Implementation Guidance on AccountingStandard for Revenue Recognition” on March 30, 2018.
The Companies have not applied the above standard and guidance forthe current consolidated fiscal year.
The applying timing is under consideration.
The impact on consolidated financial statements is under evaluation aswell.
5. Collateral Assets and Liabilities
Collateral assets and liabilities as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017

Investment securities

FY2016¥ 97¥122

FY2017

7. Comprehensive Income(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016

Valuation difference on available-for-sale securities:¥5,200¥(582)

Reclassification adjustment

(29)

(47)

(273)

Amount before tax effect

5,170

(629)

48,650Tax effect(1,595)

192(15,009)

3,575

(436)

33,641

Gains (losses) arising during the year

Valuation difference on available-for-salesecurities, net of tax$48,932

Foreign currency translation adjustment:
(124)
−

188

(1,167)

Reclassification adjustment
Amount before tax effect

(124)

188

(1,167)

Gains (losses) arising during the year−

Tax effectForeign currency translation(124)

adjustment, net of tax

−
−

188

−

(1,167)

Remeasurements of defined benefit plans:
Gains (losses) arising during the year

88

(144)

828

Reclassification adjustment

(73)

(107)

(687)

Amount before tax effect

15

(252)

141

Tax effect

(4)

77

(38)

Remeasurements of defined benefit plans, net of tax 10

(174)

94

Share of other comprehensive income of affiliates accounted for using equity methods
¥340

¥253

$3,199Accrued expenses

¥−

¥ 0

$

−

6. Research and Development Expenses
Research and development expenses included in selling, general andadministrative expenses for FY2017 and FY2016 were as follows:(Millions of Yen)FY2017¥17,228(Thousands of
U.S. dollars)

FY2016FY2017¥16,078$162,115

Gains (losses) arising during the year
Total other comprehensive income

9. Investment Securities

(1)

1

(9)

¥3,460¥(420)$32,559

8. Common Shares(1) Dividends
Cash dividends charged to retained earnings for the years ended
March 31, 2018 and 2017 represent the dividends paid out during
those years. The accompanying consolidated financial statements do
not include any provisions for a dividend approved by the Annual
Shareholders Meeting of 36 yen per share with an aggregate 5,380
million yen for the year ended March 31, 2018.

FY2017¥24,031$282,507

Unlisted securities of affiliates

6,812

6,636

64,101

Unlisted securities

1,682

1,797

15,828¥38,517¥32,465$362,445

10. Short-term Debt and Long-term Debt
Short-term debt consisting of an unsecured bank overdraft as of March
31, 2018 was 23,591 million yen.
The weighted average interest rate on short-term debt outstanding asof March 31, 2018 was 0.56%.
The weighted average interest rate on long-term debt outstanding as ofMarch 31, 2018 was 0.77%.
The weighted average interest rate on the current portion of long-term
debt outstanding as of March 31, 2018 was 0.89%.
Long-term debt as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017Long-term debt
Less current portion¥5,000FY2017FY2016¥7,650$47,050(2,554)(3,070)(24,033)¥2,446¥4,580$23,017Long-term debt payments due after FY2018 were as follows:(Millions of Yen)

(Thousands of
U.S. dollars)

FY2019¥1,754$16,505

FY2020414

3,896

FY2021194

1,826

FY2022 and thereafter

Nissan Chemical Corporation Integrated Report 2018

FY2017FY2016¥30,022Equity securities

Year ending March 31

85(Thousands of
U.S. dollars)(Millions of Yen)−

$1,148

Accounts payable(2) Retained Earnings
Retained earnings on a consolidated basis consist of legal reserve andretained earnings. In accordance with provisions of the Companies Act ofJapan, the Company has provided a legal reserve as an appropriation ofretained earnings. The Code states that while neither legal capital surplus
nor legal retained earnings are available for dividends, both may be used
to reduce or eliminate a deficit by a resolution of the shareholders’meeting, or may be transferred to stated capital common stock by aresolution of the Board of Directors. Legal reserve in the accompanying
consolidated financial statement includes only that of the Company.
Retained earnings of the Company and its consolidated subsidiaries
include a certain special reserve for the purpose of obtaining tax benefitsin accordance with the Special Taxation Law of Japan.

84

790

¥2,446$23,017

Nissan Chemical Corporation Integrated Report 201886

11. Retirement Benefits(1) The liability for retirement benefits as of FY2017 and FY2016 were as
follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016Retirement benefit obligation¥12,156¥12,031$114,388

Plan asset(14,349)(14,018)(135,024)(2,193)(1,987)(20,636)

126

101

1,186

Unfunded retirement benefit obligation(2,067)(1,885)(19,450)

Net defined benefit liability

126

101

1,186

Net defined benefit asset(2,193)(1,987)(20,636)

Net retirement benefit obligation¥ (2,067)¥ (1,885)$ (19,450)

Net retirement benefit obligation(2) Actuarial assumptions
The principal actuarial assumptions as of FY2017 and FY2016 were as
follows:
FY2017

Discount rateLong-term expected rate of return
Expected rate of salary increase (forecast)

0.8%

FY2016

0.8%

2.0%

2.0%

3.6 to 9.0%

3.6 to 9.0%

(Note) Expected rate of salary increase is calculated based on our point system.

12. Income Taxes
The Company is subject to a number of taxes based on income. The
statutory income tax rates were approximately 30.86% for the year ended
March 31, 2018 and 30.86% for the year ended March 31, 2017.
The tax effects on significant temporary differences which resulted indeferred tax assets and liabilities as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016

Deferred tax assets:
Tax effect on investment in

Segment¥ 1,124¥1,124$ 10,577

Inventory

672

746

6,324

Provision for bonuses

620

589

5,834

Prepaid consignment research expenses

541

369

5,091

Unrealized profit of inventories

407

384

3,830

Other

2,555

2,441

24,043Gross deferred tax assets

5,921

5,656

55,717

Less: Valuation allowance

(49)

(49)

Total deferred tax assets

5,871

5,606

subsidiary to be liquidated

Trading

Trading, etc.

55,246

OthersTransportation, landscaping, engineering, fertilizer, etc.

(2) Basis for the measurement of reported segment income or loss, segment assets, and other material items
The accounting policies for the reportable segments are consistent with the Company’s accounting policies used in the preparation of its consolidated financial
statements.
Intersegment sales and income (loss) are recognized based on current market prices.

(4,477)(57,467)

Net defined benefit asset

(645)

(596)

(6,069)

(268)

(276)

(2,522)

(57)

(72)

(536)

Total deferred tax liabilities(7,078)(5,422)(66,604)

Net deferred tax assets¥(1,206)¥ 184$(11,348)

The differences between the statutory tax rate and the effective tax rate
for the years ended FY2017 and FY2016 were as follows:
FY2017FY201630.86%

30.86%

2.51%

2.69%

0.41

0.46

Difference of tax rate for foreign consolidated subsidiaries(0.47)(0.65)

Equity in earnings of affiliates(1.13)(0.68)(2.64)(2.80)(5.26)(6.20)

Statutory tax rate
(Reconciliation)
Elimination of intercompany dividend income
Entertainment and other permanently non-deductible
expenseDividend and other items excluded permanently from taxable
incomeTax credit

Nissan Chemical Corporation Integrated Report 2018

Agricultural Chemicals(461)(6,107)

Other

Performance Materials

LIVALO® (anti-cholesterol drugs), etc.
Finetech® (custom manufacturing and process researching services for pharmaceutical companies)

Unrealized gain on securities

depreciation of non-current assets

Chemicals

Main Products
Basic chemicals (melamine, sulfuric acid, nitric acid, ammonia, etc.)
Fine chemicals (epoxy compound for LED sealants, solder resist and painting, flame retardants, chlorinated cyanuric
acid for sterilizing, etc.)
Display materials (LCD alignment coating, etc.)
Semiconductor materials (bottom anti-reflective coating for semiconductors, etc.)
Inorganic materials (hard coating materials, electronic information materials, polishing materials, etc.)
Agrochemicals (herbicides, insecticides, fungicides, combination fungicide and insecticide, and plant growth regulators)
Animal health products

Pharmaceuticals

Deferred tax liabilities:

Reserve for advanced

87

13. Segment Information(1) General Information about reportable segments
In regard to reportable segments, the Company is able to obtain discrete financial data from its component units.
Accordingly, its segments are subject to regular review to help the Board of Directors decide how to allocate managerial resources and evaluate businessperformance.
Divisions by products and services are located at headquarters. Each division works out a comprehensive strategy applicable to their products and services
and carries out their business activities.
The Company consists of segments based on the following divisions:

Other, net

0.37

0.04

Effective tax rate

24.65%

23.72%(3) Information on sales, income (loss), assets, and other item amounts by reportable segment
Millions of Yen
FY2016

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets

Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others¥25,723
9,057
34,7803,820
26,113¥46,403
6,406
52,80912,53348,028¥47,791
4,160
51,952
13,201
55,588¥ 7,966
26
7,992
1,656
10,182¥42,281
12,91655,198
1,697
19,782¥10,108
13,921
24,029966
10,731

1,613
−

4,763
−

1,336
−

705
−

59
2

330
−

¥ 2,000¥ 8,404¥ 2,416

¥

903

¥

46

¥

299

Adjustment(Note)

Consolidated
Total

¥

14
(46,489)(46,474)(2,437)61,322¥180,289−
180,289
31,438
231,748

79
−

8,887
2

229

¥ 14,299¥

Notes: The adjustments are as follows:(1) The (2,437) million yen adjustment in segment income includes (285) million yen in intersegment eliminations, 14 million yen sales not attributable to any reporting
segment, and (2,165) million yen corporate expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 61,322 million yen adjustment in segment assets includes (9,338) million yen in intersegment eliminations and 70,660 million yen in corporate assets not
attributable to any reportable segment. The corporate assets are mainly group administrative assets which do not belong to segments.
(3) The 79 million yen adjustment in depreciation and amortization is corporate expenses.
(4) The 229 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets are mainly group
administrative assets which do not belong to segments.

Nissan Chemical Corporation Integrated Report 201888

11. Retirement Benefits(1) The liability for retirement benefits as of FY2017 and FY2016 were as
follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016Retirement benefit obligation¥12,156¥12,031$114,388

Plan asset(14,349)(14,018)(135,024)(2,193)(1,987)(20,636)

126

101

1,186

Unfunded retirement benefit obligation(2,067)(1,885)(19,450)

Net defined benefit liability

126

101

1,186

Net defined benefit asset(2,193)(1,987)(20,636)

Net retirement benefit obligation¥ (2,067)¥ (1,885)$ (19,450)

Net retirement benefit obligation(2) Actuarial assumptions
The principal actuarial assumptions as of FY2017 and FY2016 were as
follows:
FY2017

Discount rateLong-term expected rate of return
Expected rate of salary increase (forecast)

0.8%

FY2016

0.8%

2.0%

2.0%

3.6 to 9.0%

3.6 to 9.0%

(Note) Expected rate of salary increase is calculated based on our point system.

12. Income Taxes
The Company is subject to a number of taxes based on income. The
statutory income tax rates were approximately 30.86% for the year ended
March 31, 2018 and 30.86% for the year ended March 31, 2017.
The tax effects on significant temporary differences which resulted indeferred tax assets and liabilities as of FY2017 and FY2016 were as follows:(Thousands of
U.S. dollars)(Millions of Yen)FY2017FY2017FY2016

Deferred tax assets:
Tax effect on investment in

Segment¥ 1,124¥1,124$ 10,577

Inventory

672

746

6,324

Provision for bonuses

620

589

5,834

Prepaid consignment research expenses

541

369

5,091

Unrealized profit of inventories

407

384

3,830

Other

2,555

2,441

24,043Gross deferred tax assets

5,921

5,656

55,717

Less: Valuation allowance

(49)

(49)

Total deferred tax assets

5,871

5,606

subsidiary to be liquidated

Trading

Trading, etc.

55,246

OthersTransportation, landscaping, engineering, fertilizer, etc.

(2) Basis for the measurement of reported segment income or loss, segment assets, and other material items
The accounting policies for the reportable segments are consistent with the Company’s accounting policies used in the preparation of its consolidated financial
statements.
Intersegment sales and income (loss) are recognized based on current market prices.

(4,477)(57,467)

Net defined benefit asset

(645)

(596)

(6,069)

(268)

(276)

(2,522)

(57)

(72)

(536)

Total deferred tax liabilities(7,078)(5,422)(66,604)

Net deferred tax assets¥(1,206)¥ 184$(11,348)

The differences between the statutory tax rate and the effective tax rate
for the years ended FY2017 and FY2016 were as follows:
FY2017FY201630.86%

30.86%

2.51%

2.69%

0.41

0.46

Difference of tax rate for foreign consolidated subsidiaries(0.47)(0.65)

Equity in earnings of affiliates(1.13)(0.68)(2.64)(2.80)(5.26)(6.20)

Statutory tax rate
(Reconciliation)
Elimination of intercompany dividend income
Entertainment and other permanently non-deductible
expenseDividend and other items excluded permanently from taxable
incomeTax credit

Nissan Chemical Corporation Integrated Report 2018

Agricultural Chemicals(461)(6,107)

Other

Performance Materials

LIVALO® (anti-cholesterol drugs), etc.
Finetech® (custom manufacturing and process researching services for pharmaceutical companies)

Unrealized gain on securities

depreciation of non-current assets

Chemicals

Main Products
Basic chemicals (melamine, sulfuric acid, nitric acid, ammonia, etc.)
Fine chemicals (epoxy compound for LED sealants, solder resist and painting, flame retardants, chlorinated cyanuric
acid for sterilizing, etc.)
Display materials (LCD alignment coating, etc.)
Semiconductor materials (bottom anti-reflective coating for semiconductors, etc.)
Inorganic materials (hard coating materials, electronic information materials, polishing materials, etc.)
Agrochemicals (herbicides, insecticides, fungicides, combination fungicide and insecticide, and plant growth regulators)
Animal health products

Pharmaceuticals

Deferred tax liabilities:

Reserve for advanced

87

13. Segment Information(1) General Information about reportable segments
In regard to reportable segments, the Company is able to obtain discrete financial data from its component units.
Accordingly, its segments are subject to regular review to help the Board of Directors decide how to allocate managerial resources and evaluate businessperformance.
Divisions by products and services are located at headquarters. Each division works out a comprehensive strategy applicable to their products and services
and carries out their business activities.
The Company consists of segments based on the following divisions:

Other, net

0.37

0.04

Effective tax rate

24.65%

23.72%(3) Information on sales, income (loss), assets, and other item amounts by reportable segment
Millions of Yen
FY2016

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets

Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others¥25,723
9,057
34,7803,820
26,113¥46,403
6,406
52,80912,53348,028¥47,791
4,160
51,952
13,201
55,588¥ 7,966
26
7,992
1,656
10,182¥42,281
12,91655,198
1,697
19,782¥10,108
13,921
24,029966
10,731

1,613
−

4,763
−

1,336
−

705
−

59
2

330
−

¥ 2,000¥ 8,404¥ 2,416

¥

903

¥

46

¥

299

Adjustment(Note)

Consolidated
Total

¥

14
(46,489)(46,474)(2,437)61,322¥180,289−
180,289
31,438
231,748

79
−

8,887
2

229

¥ 14,299¥

Notes: The adjustments are as follows:(1) The (2,437) million yen adjustment in segment income includes (285) million yen in intersegment eliminations, 14 million yen sales not attributable to any reporting
segment, and (2,165) million yen corporate expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 61,322 million yen adjustment in segment assets includes (9,338) million yen in intersegment eliminations and 70,660 million yen in corporate assets not
attributable to any reportable segment. The corporate assets are mainly group administrative assets which do not belong to segments.
(3) The 79 million yen adjustment in depreciation and amortization is corporate expenses.
(4) The 229 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets are mainly group
administrative assets which do not belong to segments.

Nissan Chemical Corporation Integrated Report 201888

Independent Auditor’s Report
Millions of Yen
FY2017

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets

Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others¥25,546
9,390
34,937
3,410
26,976¥51,973
6,789
58,762
14,20052,938¥54,262
3,876
58,13816,37056,571¥7,493
26
7,520
1,233
9,118

¥44,474
15,012
59,486
1,826
23,393¥ 9,638
11,822
21,461
612
9,658

1,733
1

5,925
−

1,416
−

713
−

52
−

319
−

¥ 2,594¥ 7,209¥ 2,541

¥ 679

¥

23

¥

304

Adjustment(Note)

Consolidated
Total

¥

−
(46,917)(46,917)(2,665)70,387¥193,389−
193,389
34,988249,043347−

10,5081341¥ 13,694¥

Notes: The adjustments are as follows:(1) The (2,665) million yen adjustment in segment income includes (254) million yen in intersegment eliminations, and (2,410) million yen corporate expenses not
attributable to any reportable segment. The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 70,387 million yen adjustment in segment assets includes (8,200) million yen in intersegment eliminations and 78,588 million yen in corporate assets not
attributable to any reportable segment. The corporate assets are mainly group administrative assets which do not belong to segments.
(3) The 347 million yen adjustment in depreciation and amortization is corporate expenses.
(4) The 341 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets are mainly group
administrative assets which do not belong to segments.
Thousands of U.S. dollars
Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others$240,388
88,360328,757
32,088
253,844$489,066
63,884552,950
133,622498,146$510,605
36,473547,078
154,042532,333$70,509245
70,763
11,60385,800$418,500
141,263559,763
17,183
220,128$ 90,694
111,245
201,948
5,759
90,882

16,308955,754−

13,325
−

6,709
−

489
−

3,002
−

$ 24,410$ 67,837$ 23,911

FY2017

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets$ 6,389$

216

Overseas operations, which represent sales to customers outside Japan for FY2017 and FY2016 were as follows:
Millions of Yen

FY2016
Net salesJapan

FY2017
Net sales
FY2017
Net sales

Korea

Other Asia

Europe and theUnited States Consolidated Total
Europe and theUnited States Consolidated Total¥103,077¥ 15,513¥ 39,286

Japan

Korea

Other Asia

¥104,523¥ 20,218

Japan

Korea

$983,561$190,251¥ 39,339¥ 22,412¥ 29,308¥ 180,289¥ 193,389

Thousands of U.S. dollars
Europe and the
Other Asia
United States Consolidated Total$370,180$275,788$ 2,861

Adjustment(Note)

Consolidated
Total−(441,489)(441,489)(25,078)
662,341$1,819,789−
1,819,789
329,237
2,343,493

3,265−

98,88093,209$ 128,860$$

Independent Auditor’s Report
To the Board of Directors of
Nissan Chemical Industries, Ltd.
We have audited the accompanying consolidated financial statements of Nissan Chemical Industries, Ltd. and consolidated subsidiaries,
which comprise the consolidated balance sheets as of March 31, 2018, and the related consolidated statements of income, comprehensive income, changes in net assets, and cash flows for the year then ended, and a summary of significant accounting policies and otherexplanatory information, all expressed in Japanese Yen.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in conformity withaccounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable thepreparation of consolidated financial statements that are free from material misstatements, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit inconformity with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtainreasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of theconsolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevantto the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates madeby management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial
position of Nissan Chemical Industries, Ltd. and its consolidated subsidiaries as of March 31, 2018, and the consolidated results of theiroperations and their cash flows for the year then ended in conformity with accounting principles generally accepted in Japan.
Convenience Translation
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year ended March 31, 2018 arepresented solely for convenience. Our audit also included the translation of yen amounts into U.S. dollar amounts and, in our opinion,such translation has been made on the basis described in Note 3 to the consolidated financial statements.
Yaesu Audit & Co.
Tokyo, Japan
June 27, 2018

$1,819,789

14. Amounts per Share

Net income per share is based on the weighted average number of shares of common stock outstanding during the year.
Cash dividends per share attributable to the period represent dividends declared as applicable to the year.
Amounts per share of net income and cash dividends for FY2017 and FY2016 were as follows:(Yen)
FY2017

Net income
Cash dividends

89¥180.30¥ 68.00

Nissan Chemical Corporation Integrated Report 2018

(U.S. dollars)
FY2016¥156.97¥ 52.00

FY2017

$1.70
$0.64

As the audit is for the fiscal year from April 1, 2017 to March 31, 2018, the above report does not reflect the company name change on
July 1, 2018.

Nissan Chemical Corporation Integrated Report 201890

Independent Auditor’s Report
Millions of Yen
FY2017

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets

Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others¥25,546
9,390
34,937
3,410
26,976¥51,973
6,789
58,762
14,20052,938¥54,262
3,876
58,13816,37056,571¥7,493
26
7,520
1,233
9,118

¥44,474
15,012
59,486
1,826
23,393¥ 9,638
11,822
21,461
612
9,658

1,733
1

5,925
−

1,416
−

713
−

52
−

319
−

¥ 2,594¥ 7,209¥ 2,541

¥ 679

¥

23

¥

304

Adjustment(Note)

Consolidated
Total

¥

−
(46,917)(46,917)(2,665)70,387¥193,389−
193,389
34,988249,043347−

10,5081341¥ 13,694¥

Notes: The adjustments are as follows:(1) The (2,665) million yen adjustment in segment income includes (254) million yen in intersegment eliminations, and (2,410) million yen corporate expenses not
attributable to any reportable segment. The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 70,387 million yen adjustment in segment assets includes (8,200) million yen in intersegment eliminations and 78,588 million yen in corporate assets not
attributable to any reportable segment. The corporate assets are mainly group administrative assets which do not belong to segments.
(3) The 347 million yen adjustment in depreciation and amortization is corporate expenses.
(4) The 341 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets are mainly group
administrative assets which do not belong to segments.
Thousands of U.S. dollars
Chemicals

Performance
Materials

Agricultural
Chemicals

Pharmaceuticals

Trading

Others$240,388
88,360328,757
32,088
253,844$489,066
63,884552,950
133,622498,146$510,605
36,473547,078
154,042532,333$70,509245
70,763
11,60385,800$418,500
141,263559,763
17,183
220,128$ 90,694
111,245
201,948
5,759
90,882

16,308955,754−

13,325
−

6,709
−

489
−

3,002
−

$ 24,410$ 67,837$ 23,911

FY2017

Net sales
Sales to outside customers
Intersegment sales
Total sales
Segment income (loss)
Segment assets
Other items
Depreciation and amortization
Amortization of goodwill
Increase of property, plant andequipment, and intangible assets$ 6,389$

216

Overseas operations, which represent sales to customers outside Japan for FY2017 and FY2016 were as follows:
Millions of Yen

FY2016
Net salesJapan

FY2017
Net sales
FY2017
Net sales

Korea

Other Asia

Europe and theUnited States Consolidated Total
Europe and theUnited States Consolidated Total¥103,077¥ 15,513¥ 39,286

Japan

Korea

Other Asia

¥104,523¥ 20,218

Japan

Korea

$983,561$190,251¥ 39,339¥ 22,412¥ 29,308¥ 180,289¥ 193,389

Thousands of U.S. dollars
Europe and the
Other Asia
United States Consolidated Total$370,180$275,788$ 2,861

Adjustment(Note)

Consolidated
Total−(441,489)(441,489)(25,078)
662,341$1,819,789−
1,819,789
329,237
2,343,493

3,265−

98,88093,209$ 128,860$$

Independent Auditor’s Report
To the Board of Directors of
Nissan Chemical Industries, Ltd.
We have audited the accompanying consolidated financial statements of Nissan Chemical Industries, Ltd. and consolidated subsidiaries,
which comprise the consolidated balance sheets as of March 31, 2018, and the related consolidated statements of income, comprehensive income, changes in net assets, and cash flows for the year then ended, and a summary of significant accounting policies and otherexplanatory information, all expressed in Japanese Yen.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in conformity withaccounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable thepreparation of consolidated financial statements that are free from material misstatements, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit inconformity with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtainreasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of theconsolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevantto the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates madeby management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial
position of Nissan Chemical Industries, Ltd. and its consolidated subsidiaries as of March 31, 2018, and the consolidated results of theiroperations and their cash flows for the year then ended in conformity with accounting principles generally accepted in Japan.
Convenience Translation
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year ended March 31, 2018 arepresented solely for convenience. Our audit also included the translation of yen amounts into U.S. dollar amounts and, in our opinion,such translation has been made on the basis described in Note 3 to the consolidated financial statements.
Yaesu Audit & Co.
Tokyo, Japan
June 27, 2018

$1,819,789

14. Amounts per Share

Net income per share is based on the weighted average number of shares of common stock outstanding during the year.
Cash dividends per share attributable to the period represent dividends declared as applicable to the year.
Amounts per share of net income and cash dividends for FY2017 and FY2016 were as follows:(Yen)
FY2017

Net income
Cash dividends

89¥180.30¥ 68.00

Nissan Chemical Corporation Integrated Report 2018

(U.S. dollars)
FY2016¥156.97¥ 52.00

FY2017

$1.70
$0.64

As the audit is for the fiscal year from April 1, 2017 to March 31, 2018, the above report does not reflect the company name change on
July 1, 2018.

Nissan Chemical Corporation Integrated Report 201890

Corporate Information

Domestic and Overseas Bases

List of Offices, Plants and Laboratories
Offices

Domestic Production Bases
Nagoya Plant

Toyama Plant

This plant faces the Port of Nagoya. Here we
manufacture sulfuric acid and high-quality urea
aqueous solution, among other products.

This plant is located in the center of Toyama Plain.
Here we manufacture various groups of products,
such as basic chemicals, environmental
chemicals, and performance materials.

Head Office

Sapporo Sales Office

5-1, Nihonbashi 2-Chome, Chuo-ku, Tokyo 103-6119
Tel: +81-3-4463-8111

Maruito Sapporo Building 1-1, Kita-Nijyo-Nishi, Chuo-ku, Sapporo 060-0002
Tel: +81-11-251-0261

Sendai Sales Office

Nagoya Sales Office

Greenwood Sendai Ichibancho Building 2-7-12, Ichibancho, Aoba-ku, Sendai 980-0811
Tel: +81-22-266-4311

Nagoya KS Building 3-1-18, Taiko, Nakamura-ku, Nagoya 453-0801
Tel: +81-52-452-8623

Osaka Sales Office

Fukuoka Sales OfficeOsaka Daiichi Seimei Building 1-8-17, Umeda, Kita-ku, Osaka 530-0001
Tel: +81-6-6346-7200

JPR Hakata Building 1-4-4, Hakata Ekimae, Hakata-ku, Fukuoka 812-0011
Tel: +81-92-432-3421

PlantsOnoda Plant
This plant is located in Sanyo-Onoda City,
Yamaguchi. It is our base for the production offine organic synthetic compounds, such as
agrochemicals and pharmaceuticals.

Sodegaura Plant

Sodegaura Plant Goi Works

11-1, Kitasode, Sodegaura, Chiba 299-0266
Tel: +81-438-63-2341

12-17, Goiminamikaigan, Ichihara, Chiba 290-0045
Tel: +81-436-22-2110

Saitama Plant

Toyama Plant

235-1, Aza Nishidai, Oaza Jimbohara-machi, Kamisato-machi, Kodama-gun, Saitama 369-0305
Tel: +81-495-34-2810

635, Sasakura, Fuchu-machi, Toyama 939-2792
Tel: +81-76-433-9602

Nagoya Plant

Onoda Plant

7, Tsukiji-cho, Minato-ku, Nagoya 455-0045
Tel: +81-52-661-1676

6903-1, Oaza Onoda, Sanyo-Onoda, Yamaguchi 756-0093
Tel: +81-836-83-2800

Laboratories
Chemical Research Laboratories

Materials Research Laboratories

10-1, Tsuboi-Nishi 2-chome, Funabashi, Chiba 274-8507
Tel: +81-47-465-1112

488-6, Suzumi-cho, Funabashi, Chiba 274-0052
Tel: +81-47-419-3810

Biological Research Laboratories

11-1, Kitasode, Sodegaura, Chiba 299-0266
Tel: +81-438-64-2881

1470, Shiraoka, Shiraoka, Saitama 349-0294
Tel: +81-480-92-2513

635, Sasakura, Fuchu-machi, Toyama 939-2792
Tel: +81-76-465-7133

Nissan Chemical GroupJapan

Saitama Plant
This plant is located in northern Saitama. Here
we manufacture agricultural formulations.
91

Nissan Chemical Corporation Integrated Report 2018

Sodegaura Plant, Sodegaura Plant Goi Works
These plants are located in the industrial area in
Sodegaura and Ichihara City, Chiba. These are ourbases for the production of performance materials.

Nissei Corporation

Nissan Butsuryu Co., Ltd.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3241-2548■ Sales of chemical products and insurance, and real estate business

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-5255-6901■ Transportation

Nissan Green & Landscape Co., Ltd.

Nissan Engineering, Ltd.

3-16-9, Uchikanda, Chiyoda-ku, Tokyo 101-0047
Tel: +81-3-3256-4031■ Landscaping and civil engineering634-1, Sasakura, Fuchu-machi, Toyama 939-2753
Tel: +81-76-465-5711■ Plant engineering services

Nihon Hiryo Co., Ltd.

Environmental Technical Laboratories, Ltd.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3241-4231■ Fertilizers and agrochemicals

2-11-7, Kohoku, Adachi-ku, Tokyo 123-0872
Tel: +81-3-3898-6643■ Environmental analysis

Sun Agro Co., Ltd.

Clariant Catalysts (Japan) K.K.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3510-3601■ Fertilizers and agrochemicals

2-28-8, Honkomagome, Bunkyo-ku, Tokyo 113-0021
Tel: +81-3-5977-7300■ Catalysts for petrochemical and petroleum products

Nissan Chemical Corporation Integrated Report 201892

Corporate Information

Domestic and Overseas Bases

List of Offices, Plants and Laboratories
Offices

Domestic Production Bases
Nagoya Plant

Toyama Plant

This plant faces the Port of Nagoya. Here we
manufacture sulfuric acid and high-quality urea
aqueous solution, among other products.

This plant is located in the center of Toyama Plain.
Here we manufacture various groups of products,
such as basic chemicals, environmental
chemicals, and performance materials.

Head Office

Sapporo Sales Office

5-1, Nihonbashi 2-Chome, Chuo-ku, Tokyo 103-6119
Tel: +81-3-4463-8111

Maruito Sapporo Building 1-1, Kita-Nijyo-Nishi, Chuo-ku, Sapporo 060-0002
Tel: +81-11-251-0261

Sendai Sales Office

Nagoya Sales Office

Greenwood Sendai Ichibancho Building 2-7-12, Ichibancho, Aoba-ku, Sendai 980-0811
Tel: +81-22-266-4311

Nagoya KS Building 3-1-18, Taiko, Nakamura-ku, Nagoya 453-0801
Tel: +81-52-452-8623

Osaka Sales Office

Fukuoka Sales OfficeOsaka Daiichi Seimei Building 1-8-17, Umeda, Kita-ku, Osaka 530-0001
Tel: +81-6-6346-7200

JPR Hakata Building 1-4-4, Hakata Ekimae, Hakata-ku, Fukuoka 812-0011
Tel: +81-92-432-3421

PlantsOnoda Plant
This plant is located in Sanyo-Onoda City,
Yamaguchi. It is our base for the production offine organic synthetic compounds, such as
agrochemicals and pharmaceuticals.

Sodegaura Plant

Sodegaura Plant Goi Works

11-1, Kitasode, Sodegaura, Chiba 299-0266
Tel: +81-438-63-2341

12-17, Goiminamikaigan, Ichihara, Chiba 290-0045
Tel: +81-436-22-2110

Saitama Plant

Toyama Plant

235-1, Aza Nishidai, Oaza Jimbohara-machi, Kamisato-machi, Kodama-gun, Saitama 369-0305
Tel: +81-495-34-2810

635, Sasakura, Fuchu-machi, Toyama 939-2792
Tel: +81-76-433-9602

Nagoya Plant

Onoda Plant

7, Tsukiji-cho, Minato-ku, Nagoya 455-0045
Tel: +81-52-661-1676

6903-1, Oaza Onoda, Sanyo-Onoda, Yamaguchi 756-0093
Tel: +81-836-83-2800

Laboratories
Chemical Research Laboratories

Materials Research Laboratories

10-1, Tsuboi-Nishi 2-chome, Funabashi, Chiba 274-8507
Tel: +81-47-465-1112

488-6, Suzumi-cho, Funabashi, Chiba 274-0052
Tel: +81-47-419-3810

Biological Research Laboratories

11-1, Kitasode, Sodegaura, Chiba 299-0266
Tel: +81-438-64-2881

1470, Shiraoka, Shiraoka, Saitama 349-0294
Tel: +81-480-92-2513

635, Sasakura, Fuchu-machi, Toyama 939-2792
Tel: +81-76-465-7133

Nissan Chemical GroupJapan

Saitama Plant
This plant is located in northern Saitama. Here
we manufacture agricultural formulations.
91

Nissan Chemical Corporation Integrated Report 2018

Sodegaura Plant, Sodegaura Plant Goi Works
These plants are located in the industrial area in
Sodegaura and Ichihara City, Chiba. These are ourbases for the production of performance materials.

Nissei Corporation

Nissan Butsuryu Co., Ltd.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3241-2548■ Sales of chemical products and insurance, and real estate business

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-5255-6901■ Transportation

Nissan Green & Landscape Co., Ltd.

Nissan Engineering, Ltd.

3-16-9, Uchikanda, Chiyoda-ku, Tokyo 101-0047
Tel: +81-3-3256-4031■ Landscaping and civil engineering634-1, Sasakura, Fuchu-machi, Toyama 939-2753
Tel: +81-76-465-5711■ Plant engineering services

Nihon Hiryo Co., Ltd.

Environmental Technical Laboratories, Ltd.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3241-4231■ Fertilizers and agrochemicals

2-11-7, Kohoku, Adachi-ku, Tokyo 123-0872
Tel: +81-3-3898-6643■ Environmental analysis

Sun Agro Co., Ltd.

Clariant Catalysts (Japan) K.K.

1-10-5, Nihonbashihon-cho, Chuo-ku, Tokyo 103-0023
Tel: +81-3-3510-3601■ Fertilizers and agrochemicals

2-28-8, Honkomagome, Bunkyo-ku, Tokyo 113-0021
Tel: +81-3-5977-7300■ Catalysts for petrochemical and petroleum products

Nissan Chemical Corporation Integrated Report 201892

C o rporat e I nf orm a tio n

Corporate Profile

Domestic and Overseas Bases(As of July 1, 2018)

Overseas Bases (As of July 1, 2018)

America

Corporate Name

Nissan Chemical Corporation

Head Office

5-1, Nihonbashi 2-Chome, Chuo-ku, Tokyo 103-6119, Japan

FranceTel: +81-3-4463-8111

Nissan Chemical America Corporation
Nissan Chemical Europe S.A.S.

Parc d’Affaires de Crécy - 10A rue de la Voie Lactée
69370 Saint Didier au Mont d'Or, France
Tel: +33-4-37-64-40-20■ Sales of agrochemicals

10333 Richmond Avenue, Suite 1100, Houston,
Texas 77042, U.S.A.
Tel: +1-713-532-4745■ Production and sales of inorganic materials

Founded1887

Capital Stock

18,942 million yen

Number of Employees

Consolidated: 2,511 (As of March 31, 2018)

Stock Listing

Tokyo Stock Exchange

Transfer Agent

Sumitomo Mitsui Trust Bank, Limited 4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo 100-8233, Japan

Share Information(As of March 31, 2018)
Total Number of Authorized Shares

360,000,000

Shares of Common Share Issued

151,000,000

Shareholders

11,189Major shareholders (Top ten companies)

India
Nissan Agro Tech India PVT. LTD.

502-504, 5th Floor, Tower B, Spazedge
Commercial Complex, Sector-47, Sohna Road,
Gurgaon-122002, Haryana, India
Tel: +91-124-4214446 / 47
■ Sales support and promotional services for agrochemicals

China
Nissan Chemical Product (Shanghai) Co., Ltd.

BrazilNissan Chemical Do Brasil

Avenida Gisele Constantino, 1850,
Salas 1518 a 1520, Parque Bela Vista,
Votorantim, SP, 18110-650, Brasil
Tel: +55-15-3019-8772■ Sales support and promotional services for agrochemicals

Korea

Room 1110A, New Town Center,
83, Lou Shan Guan Road, Shanghai, China
Tel: +86-21-6236-8300■ Sales support and promotional services for agrochemicals

Nissan Chemical Materials Research (Suzhou) Co., Ltd.

Room101, NW-10, Nanopolis Suzhou 99 Jinji Lake Avenue,
Suzhou Industrial Park, China
Tel: +86-512-62732080■ R&D, sales support and promotional services for performance materials

TaiwanNissan Chemical Taiwan Co., Ltd.

5F., No.67, Luke 2nd Rd., Luzhu Dist., Kaohsiung City 821,
Taiwan (R.O.C.)
Tel: +886-7-695-5252■ R&D and sales support for display and semiconductor materials

93

Nissan Chemical Corporation Integrated Report 2018

Number of shares held (1,000 shares)

Investment (%)

The Master Trust Bank of Japan, Ltd. (Trust Account)

23,117

15.5

Japan Trustee Services Bank, Ltd. (Trust Account)

10,528

7.0

Trust & Custody Services Bank, Ltd. as trustee for theMizuho Trust & Banking Co., Ltd. Retirement Benefit Trust

7,516

5.0

The Norinchukin Bank

4,800

3.2

Nissan Chemical Customer Shareholders Association

3,998

2.7

Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account)

2,905

1.9

Sompo Japan Nipponkoa Insurance Inc.

2,380

1.6

Ono Pharmaceutical Co., Ltd.

2,376

1.6

Japan Trustee Services Bank, Ltd. (Trust Account 5)

2,329

1.6

STATE STREET BANK WEST CLIENT – TREATY 505234

2,184

1.5

(Note) Investment percentages are calculated excluding treasury shares.

NCK Co., Ltd.

127, Chupalsandan-ro, Paengseong-eup, Pyeongtaek-si,
Gyeonggi-do, 17998, KOREA
Tel: +82-31-691-7044■ Production and sales of display and semiconductor materials

Nissan Chemical Agro Korea Ltd.

Percentage ofshare held (%)

Financial
institutions

Securities
companies

Other domestic
companies

Overseas
investors

49.4

1.7

11.2

25.4

Individuals / Others Treasury shares
11.3

1.0

Room 2001, 74, Sejong-daero, Jung-gu,
Seoul 04526, Korea
Tel: +82-2-774-6470■ Sales of agrochemicals

Nissan Chemical Corporation Integrated Report 201894

C o rporat e I nf orm a tio n

Corporate Profile

Domestic and Overseas Bases(As of July 1, 2018)

Overseas Bases (As of July 1, 2018)

America

Corporate Name

Nissan Chemical Corporation

Head Office

5-1, Nihonbashi 2-Chome, Chuo-ku, Tokyo 103-6119, Japan

FranceTel: +81-3-4463-8111

Nissan Chemical America Corporation
Nissan Chemical Europe S.A.S.

Parc d’Affaires de Crécy - 10A rue de la Voie Lactée
69370 Saint Didier au Mont d'Or, France
Tel: +33-4-37-64-40-20■ Sales of agrochemicals

10333 Richmond Avenue, Suite 1100, Houston,
Texas 77042, U.S.A.
Tel: +1-713-532-4745■ Production and sales of inorganic materials

Founded1887

Capital Stock

18,942 million yen

Number of Employees

Consolidated: 2,511 (As of March 31, 2018)

Stock Listing

Tokyo Stock Exchange

Transfer Agent

Sumitomo Mitsui Trust Bank, Limited 4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo 100-8233, Japan

Share Information(As of March 31, 2018)
Total Number of Authorized Shares

360,000,000

Shares of Common Share Issued

151,000,000

Shareholders

11,189Major shareholders (Top ten companies)

India
Nissan Agro Tech India PVT. LTD.

502-504, 5th Floor, Tower B, Spazedge
Commercial Complex, Sector-47, Sohna Road,
Gurgaon-122002, Haryana, India
Tel: +91-124-4214446 / 47
■ Sales support and promotional services for agrochemicals

China
Nissan Chemical Product (Shanghai) Co., Ltd.

BrazilNissan Chemical Do Brasil

Avenida Gisele Constantino, 1850,
Salas 1518 a 1520, Parque Bela Vista,
Votorantim, SP, 18110-650, Brasil
Tel: +55-15-3019-8772■ Sales support and promotional services for agrochemicals

Korea

Room 1110A, New Town Center,
83, Lou Shan Guan Road, Shanghai, China
Tel: +86-21-6236-8300■ Sales support and promotional services for agrochemicals

Nissan Chemical Materials Research (Suzhou) Co., Ltd.

Room101, NW-10, Nanopolis Suzhou 99 Jinji Lake Avenue,
Suzhou Industrial Park, China
Tel: +86-512-62732080■ R&D, sales support and promotional services for performance materials

TaiwanNissan Chemical Taiwan Co., Ltd.

5F., No.67, Luke 2nd Rd., Luzhu Dist., Kaohsiung City 821,
Taiwan (R.O.C.)
Tel: +886-7-695-5252■ R&D and sales support for display and semiconductor materials

93

Nissan Chemical Corporation Integrated Report 2018

Number of shares held (1,000 shares)

Investment (%)

The Master Trust Bank of Japan, Ltd. (Trust Account)

23,117

15.5

Japan Trustee Services Bank, Ltd. (Trust Account)

10,528

7.0

Trust & Custody Services Bank, Ltd. as trustee for theMizuho Trust & Banking Co., Ltd. Retirement Benefit Trust

7,516

5.0

The Norinchukin Bank

4,800

3.2

Nissan Chemical Customer Shareholders Association

3,998

2.7

Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account)

2,905

1.9

Sompo Japan Nipponkoa Insurance Inc.

2,380

1.6

Ono Pharmaceutical Co., Ltd.

2,376

1.6

Japan Trustee Services Bank, Ltd. (Trust Account 5)

2,329

1.6

STATE STREET BANK WEST CLIENT – TREATY 505234

2,184

1.5

(Note) Investment percentages are calculated excluding treasury shares.

NCK Co., Ltd.

127, Chupalsandan-ro, Paengseong-eup, Pyeongtaek-si,
Gyeonggi-do, 17998, KOREA
Tel: +82-31-691-7044■ Production and sales of display and semiconductor materials

Nissan Chemical Agro Korea Ltd.

Percentage ofshare held (%)

Financial
institutions

Securities
companies

Other domestic
companies

Overseas
investors

49.4

1.7

11.2

25.4

Individuals / Others Treasury shares
11.3

1.0

Room 2001, 74, Sejong-daero, Jung-gu,
Seoul 04526, Korea
Tel: +82-2-774-6470■ Sales of agrochemicals

Nissan Chemical Corporation Integrated Report 2018

94

GRI Content Index

This refers to information related to items of GRI Standard as a reference, but does not indicate that this report is in accordance with GRI Standard.
“Not Applicable” indicates that the corresponding items are not relevant or have no cases relevant to any critical levels. “―” indicates no information.

GRI102 : General Disclosures 2016
1. Organizational profile
102-1
Name of the organization
102-2

Activities, brands, products, and services

102-3

Location of headquarters

102-4

Location of operations

102-5

Ownership and legal form

102-6

Markets served

102-7

Scale of the organization

102-8

Information on employees and other workers

102-9

Supply chain

102-10Significant changes to the organization and its supply chain

102-11

Precautionary Principle or approach102-12External initiatives

102-13

Membership of associations

2. Strategy
102-14
Statement from senior decision-maker102-15Key impacts, risks, and opportunities

3. Ethics and integrity
102-16102-17

Values, principles, standards, and norms of behavior

Mechanisms for advice and concerns about ethics

4. Governance102-18Governance structure102-19Delegating authority

102-20Executive-level responsibility for economic, environmental, and social topics

102-21

Consulting stakeholders on economic, environmental, and social topics

102-22Composition of the highest governance body and its committees

102-23Chair of the highest governance body102-24

Nominating and selecting the highest governance body102-25

Conflicts of interest

102-26

Role of highest governance body in setting purpose, values, and strategy

102-27

Collective knowledge of highest governance body102-28

Evaluating the highest governance body’s performance102-29102-3095

Identifying and managing economic, environmental, and social impacts

Effectiveness of risk management processes

Nissan Chemical Corporation Integrated Report 2018

Reference pageP94 Corporate ProfileP23-26 Main Products
P27-38 Business Overview
P94 Corporate Profile
P9-10 Non-Financial Highlights
P91-93 Domestic and Overseas bases
P94 Corporate Profile
P7-8 Financial Highlights
P27-38 Business Overview
Annual securities report
P7-8 Financial Highlights
P9-10 Non-Financial Highlights
P75-90 Financial Section
P91-93 Domestic and Overseas bases
Annual securities report
P9-10 Non-Financial Highlights
Annual securities report―P11-14 Message from the President
P15-18 “Progress2030” and “Vista2021”
P49-64 Responsible Care (RC) Activities
P11-14 Message from the President
P44 Promotion of CSR
P49-52 Responsible Care Management
P11-14 Message from the President
P49-52 Responsible Care Management
P59-60 Biodiversity Conservation
P63-64 Chemicals and Products Safety
P11-14 Message from the President
P19-20 Identified Materiality
P21-22 Process of Value Creation
P47-48 Risk Management
P2 Corporate Ethos Structure
P11-14 Message from the President
P45-46 ComplianceP39-43 Corporate GovernanceP45-46 ComplianceCorporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance report
P68 Relationships with Shareholders and Investors
Corporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance reportP19-20 Identified Materiality
P21-22 Process of Value Creation
P39-43 Corporate GovernanceP45-46 ComplianceP47-48 Risk Management
P49-52 Responsible Care Management
Corporate governance reportP47-48 Risk Management
Corporate governance report102-31

Review of economic, environmental, and social topics

102-32Highest governance body’s role in sustainability reporting

102-33

Communicating critical concerns

102-34Nature and total number of critical concerns

102-35

Remuneration policies

102-36

Process for determining remuneration

102-37

Stakeholders’ involvement in remuneration

Annual total compensation ratio
102-38102-39Percentage increase in annual total compensation ratio
5. Stakeholder engagement
List of stakeholder groups
102-40
Collective bargaining agreements
102-41
Identifying and selecting stakeholders
102-42
Approach to stakeholder engagement102-43
Key topics and concerns raised
102-44
6. Reporting practice102-45

Entities included in the consolidated financial statements

102-46
Defining report content and topic Boundaries
102-47
List of material topics
102-48
Restatements of information
102-49Changes in reporting
102-50
Reporting period
102-51
Date of most recent report102-52
Reporting cycle
102-53
Contact point for questions regarding the report102-54Claims of reporting in accordance with the GRI Standards
102-55
GRI content index
102-56External assurance
GRI103 : Management approach 2016
103-1
Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

Economic

GRI201 : Economic Performance 2016
201-1
Direct economic value generated and distributed
201-2
Financial implications and other risks and opportunities due to climate change
201-3
Defined benefit plan obligations and other retirement plans
201-4
Financial assistance received from government
GRI202 : Market Presence 2016
202-1
Ratios of standard entry level wage by gender compared to local minimum wage
Proportion of senior management hired from the local community
202-2
GRI203 : Indirect Economic Impacts 2016
203-1

Infrastructure investments and services supported

203-2
Significant indirect economic impacts
GRI204 : Procurement Practices 2016
204-1
Proportion of spending on local suppliers

P44 Promotion of CSR
P47-48 Risk Management
P49-52 Responsible Care Management
Corporate governance report―P45-46 ComplianceP47-48 Risk Management
Corporate governance reportP45-46 ComplianceP47-48 Risk Management
P39-43 Corporate GovernanceCorporate governance reportP39-43 Corporate GovernanceCorporate governance reportP39-43 Corporate GovernanceCorporate governance report――P65-74 Communication with Society
P71-74 Relationships with Employees
P65-74 Communication with Society
P65-74 Communication with Society
P59-60 Biodiversity Conservation
P3 Editorial Policy
Annual securities report
P3 Editorial Policy
P19-20 Identified Materiality―
P19-20 Identified Materiality
P3 Editorial Policy
P3 Editorial Policy
P3 Editorial Policy
P3 Editorial Policy―
P95-98 GRI Content Index―
P19-20 Identified Materiality
P19-20 Identified Materiality
P21-22 Process of Value Creation
P27-38 Business Overview
P39-43 Corporate Governance
P44 Promotion of CSR
P45-46 ComplianceP47-48 Risk Management
P49-64 Responsible Care (RC) Activities
P65-66 Relationships with Customers
P67 Relationships with Business Partners
P71-74 Relationships with Employees
P39-43 Corporate Governance
P44 Promotion of CSR
P45-46 ComplianceP47-48 Risk Management
P49-52 Responsible Care Management
P65-66 Relationships with Customers
Reference page
Annual securities report―
Annual securities report―――P59-60 Biodiversity Conservation
P69-70 Relationships with Communities and Society――

Nissan Chemical Corporation Integrated Report 2018

96

GRI Content Index

This refers to information related to items of GRI Standard as a reference, but does not indicate that this report is in accordance with GRI Standard.
“Not Applicable” indicates that the corresponding items are not relevant or have no cases relevant to any critical levels. “―” indicates no information.

GRI102 : General Disclosures 2016
1. Organizational profile
102-1
Name of the organization
102-2

Activities, brands, products, and services

102-3

Location of headquarters

102-4

Location of operations

102-5

Ownership and legal form

102-6

Markets served

102-7

Scale of the organization

102-8

Information on employees and other workers

102-9

Supply chain

102-10Significant changes to the organization and its supply chain

102-11

Precautionary Principle or approach102-12External initiatives

102-13

Membership of associations

2. Strategy
102-14
Statement from senior decision-maker102-15Key impacts, risks, and opportunities

3. Ethics and integrity
102-16102-17

Values, principles, standards, and norms of behavior

Mechanisms for advice and concerns about ethics

4. Governance102-18Governance structure102-19Delegating authority

102-20Executive-level responsibility for economic, environmental, and social topics

102-21

Consulting stakeholders on economic, environmental, and social topics

102-22Composition of the highest governance body and its committees

102-23Chair of the highest governance body102-24

Nominating and selecting the highest governance body102-25

Conflicts of interest

102-26

Role of highest governance body in setting purpose, values, and strategy

102-27

Collective knowledge of highest governance body102-28

Evaluating the highest governance body’s performance102-29102-3095

Identifying and managing economic, environmental, and social impacts

Effectiveness of risk management processes

Nissan Chemical Corporation Integrated Report 2018

Reference pageP94 Corporate ProfileP23-26 Main Products
P27-38 Business Overview
P94 Corporate Profile
P9-10 Non-Financial Highlights
P91-93 Domestic and Overseas bases
P94 Corporate Profile
P7-8 Financial Highlights
P27-38 Business Overview
Annual securities report
P7-8 Financial Highlights
P9-10 Non-Financial Highlights
P75-90 Financial Section
P91-93 Domestic and Overseas bases
Annual securities report
P9-10 Non-Financial Highlights
Annual securities report―P11-14 Message from the President
P15-18 “Progress2030” and “Vista2021”
P49-64 Responsible Care (RC) Activities
P11-14 Message from the President
P44 Promotion of CSR
P49-52 Responsible Care Management
P11-14 Message from the President
P49-52 Responsible Care Management
P59-60 Biodiversity Conservation
P63-64 Chemicals and Products Safety
P11-14 Message from the President
P19-20 Identified Materiality
P21-22 Process of Value Creation
P47-48 Risk Management
P2 Corporate Ethos Structure
P11-14 Message from the President
P45-46 ComplianceP39-43 Corporate GovernanceP45-46 ComplianceCorporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance report
P68 Relationships with Shareholders and Investors
Corporate governance reportP39-43 Corporate Governance
P44 Promotion of CSR
Corporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance report
Corporate governance reportP39-43 Corporate GovernanceCorporate governance reportP19-20 Identified Materiality
P21-22 Process of Value Creation
P39-43 Corporate GovernanceP45-46 ComplianceP47-48 Risk Management
P49-52 Responsible Care Management
Corporate governance reportP47-48 Risk Management
Corporate governance report102-31

Review of economic, environmental, and social topics

102-32Highest governance body’s role in sustainability reporting

102-33

Communicating critical concerns

102-34Nature and total number of critical concerns

102-35

Remuneration policies

102-36

Process for determining remuneration

102-37

Stakeholders’ involvement in remuneration

Annual total compensation ratio
102-38102-39Percentage increase in annual total compensation ratio
5. Stakeholder engagement
List of stakeholder groups
102-40
Collective bargaining agreements
102-41
Identifying and selecting stakeholders
102-42
Approach to stakeholder engagement102-43
Key topics and concerns raised
102-44
6. Reporting practice102-45

Entities included in the consolidated financial statements

102-46
Defining report content and topic Boundaries
102-47
List of material topics
102-48
Restatements of information
102-49Changes in reporting
102-50
Reporting period
102-51
Date of most recent report102-52
Reporting cycle
102-53
Contact point for questions regarding the report102-54Claims of reporting in accordance with the GRI Standards
102-55
GRI content index
102-56External assurance
GRI103 : Management approach 2016
103-1
Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

Economic

GRI201 : Economic Performance 2016
201-1
Direct economic value generated and distributed
201-2
Financial implications and other risks and opportunities due to climate change
201-3
Defined benefit plan obligations and other retirement plans
201-4
Financial assistance received from government
GRI202 : Market Presence 2016
202-1
Ratios of standard entry level wage by gender compared to local minimum wage
Proportion of senior management hired from the local community
202-2
GRI203 : Indirect Economic Impacts 2016
203-1

Infrastructure investments and services supported

203-2
Significant indirect economic impacts
GRI204 : Procurement Practices 2016
204-1
Proportion of spending on local suppliers

P44 Promotion of CSR
P47-48 Risk Management
P49-52 Responsible Care Management
Corporate governance report―P45-46 ComplianceP47-48 Risk Management
Corporate governance reportP45-46 ComplianceP47-48 Risk Management
P39-43 Corporate GovernanceCorporate governance reportP39-43 Corporate GovernanceCorporate governance reportP39-43 Corporate GovernanceCorporate governance report――P65-74 Communication with Society
P71-74 Relationships with Employees
P65-74 Communication with Society
P65-74 Communication with Society
P59-60 Biodiversity Conservation
P3 Editorial Policy
Annual securities report
P3 Editorial Policy
P19-20 Identified Materiality―
P19-20 Identified Materiality
P3 Editorial Policy
P3 Editorial Policy
P3 Editorial Policy
P3 Editorial Policy―
P95-98 GRI Content Index―
P19-20 Identified Materiality
P19-20 Identified Materiality
P21-22 Process of Value Creation
P27-38 Business Overview
P39-43 Corporate Governance
P44 Promotion of CSR
P45-46 ComplianceP47-48 Risk Management
P49-64 Responsible Care (RC) Activities
P65-66 Relationships with Customers
P67 Relationships with Business Partners
P71-74 Relationships with Employees
P39-43 Corporate Governance
P44 Promotion of CSR
P45-46 ComplianceP47-48 Risk Management
P49-52 Responsible Care Management
P65-66 Relationships with Customers
Reference page
Annual securities report―
Annual securities report―――P59-60 Biodiversity Conservation
P69-70 Relationships with Communities and Society――

Nissan Chemical Corporation Integrated Report 2018

96

GRI Content Index
GRI205 : Anti-corruption 2016
Operations assessed for risks related to corruption
205-1
Communication and training about anti-corruption policies and procedures
205-2
205-3
Confirmed incidents of corruption and actions taken
GRI206 : Anti-competitive Behavior
Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
206-1

Environmental

GRI301 : Materials 2016
301-1
Materials used by weight or volume301-2
Recycled input materials used
301-3
Reclaimed products and their packaging materials
GRI302 : Energy 2016
302-1
Energy consumption within the organization
302-2
Energy consumption outside of the organization
Energy intensity
302-3
302-4
Reduction of energy consumption
302-5
Reductions in energy requirements of products and services
GRI303 : Water 2016
303-1
Water withdrawal by source
303-2
Water sources significantly affected by withdrawal of water
303-3
Water recycled and reused
GRI304 : Biodiversity 2016
304-1
Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas
304-2
Significant impacts of activities, products, and services on biodiversity
304-3
Habitats protected or restored
304-4
IUCN Red List species and national conservation list species with habitats in areas affected by operations
GRI305 : Emissions 2016
305-1
Direct (Scope 1) GHG emissions
305-2
Energy indirect (Scope 2) GHG emissions
305-3
Other indirect (Scope 3) GHG emissions
305-4
GHG emissions intensity
305-5
Reduction of GHG emissions
305-6
Emissions of ozone-depleting substances (ODS)
305-7
Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions
GRI306 : Effluents and Waste 2016306-1
Water discharge by quality and destination
306-2
Waste by type and disposal method
306-3
Significant spills
306-4
Transport of hazardous waste
306-5
Water bodies affected by water discharges and / or runoff
GRI307 : Environmental Compliance 2016
307-1
Non-compliance with environmental laws and regulations
GRI308 : Supplier Environmental Assessment 2016308-1
New suppliers that were screened using environmental criteria
308-2
Negative environmental impacts in the supply chain and actions taken

SocialGRI401 : Employment 2016
401-1
New employee hires and employee turnover
401-2
Benefits provided to full-time employees that are not provided to temporary or part-time employees
401-3
Parental leave
GRI402 : Labor / Management Relations 2016
402-1
Minimum notice periods regarding operational changes
GRI403 : Occupational Health and Safety 2016403-1
Workers representation in formal joint management–worker health and safety committees
403-2
Types of injury and rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities
403-3
Workers with high incidence or high risk of diseases related to their occupation
403-4
Health and safety topics covered in formal agreements with trade unions
GRI404 : Training and Education 2016
404-1
Average hours of training per year per employee
404-2
Programs for upgrading employee skills and transition assistance programs
404-3
Percentage of employees receiving regular performance and career development reviews
GRI405 : Diversity and Equal Opportunity 2016405-1
Diversity of governance bodies and employees
405-2
Ratio of basic salary and remuneration of women to men
GRI406 : Non-discrimination 2016406-1
Incidents of discrimination and corrective actions taken
GRI407 : Freedom of Association and Collective Bargaining 2016
Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk
407-1
GRI408 : Child Labor 2016
408-1
Operations and suppliers at significant risk for incidents of child labor

97

Nissan Chemical Corporation Integrated Report 2018―
P45-46 Compliance
Not applicableNot applicable

Reference pageP53-58 Environment Safety and Climate Change Strategy――
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy―
P53-58 Environment Safety and Climate Change Strategy―
No water recycling / reuse
P59-60 Biodiversity Conservation―
P59-60 Biodiversity Conservation―
P53-58 Environment Safety and Climate Change Strategy
CO2 emissions from energy use, CO2 emissions from non-energy use
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy―
P53-58 Environment Safety and Climate Change Strategy

GRI409 : Forced or Compulsory Labor 2016
Operations and suppliers at significant risk for incidents of forced or compulsory labor
409-1
GRI410 : Security Practices 2016
Security personnel trained in human rights policies or procedures
410-1
GRI411 : Rights of Indigenous Peoples 2016
Incidents of violations involving rights of indigenous peoples
411-1
GRI412 : Human Rights Assessment 2016
Operations that have been subject to human rights reviews or impact assessments
412-1
Employee training on human rights policies or procedures
412-2
Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening
412-3
GRI413 : Local Communities 2016
Operations with local community engagement, impact assessments, and development programs
413-1
Operations with significant actual and potential negative impacts on local communities
413-2
GRI414 : Supplier Social Assessment 2016
New suppliers that were screened using social criteria
414-1
Negative social impacts in the supply chain and actions taken
414-2
GRI415 : Public Policy 2016
Political contributions
415-1
GRI416 : Customer Health and Safety 2016
Assessment of the health and safety impacts of product and service categories
416-1
Incidents of non-compliance concerning the health and safety impacts of products and services
416-2
GRI417 : Marketing and Labeling 2016
Requirements for product and service information and labeling
417-1
Incidents of non-compliance concerning product and service information and labeling
417-2
Incidents of non-compliance concerning marketing communications
417-3
GRI418 : Customer Privacy 2016
Substantiated complaints concerning breaches of customer privacy and losses of customer data
418-1
GRI419 : Socioeconomic Compliance 2016
Non-compliance with laws and regulations in the social and economic area
419-1

Not applicable―Not applicable――――Not applicable―――P63-64 Chemicals and Products Safety
Not applicable―P65-66 Relationships with Customers
Not applicableNot applicableNot applicableP53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
Not applicable――Not applicable――
Reference page

P9-10 Non-Financial Highlights―
P9-10 Non-Financial Highlights―
P71-74 Relationships with Employees
P61-62 Safety and Disaster Prevention, Occupational Safety and Health―P71-74 Relationships with Employees
P71-74 Relationships with Employees
P71-74 Relationships with Employees
P71-74 Relationships with Employees
P9-10 Non-Financial Highlights
Basic salary does not differ between women and men.
Not applicableNot applicableNot applicable

Nissan Chemical Corporation Integrated Report 2018

98

GRI Content Index
GRI205 : Anti-corruption 2016
Operations assessed for risks related to corruption
205-1
Communication and training about anti-corruption policies and procedures
205-2
205-3
Confirmed incidents of corruption and actions taken
GRI206 : Anti-competitive Behavior
Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
206-1

Environmental

GRI301 : Materials 2016
301-1
Materials used by weight or volume301-2
Recycled input materials used
301-3
Reclaimed products and their packaging materials
GRI302 : Energy 2016
302-1
Energy consumption within the organization
302-2
Energy consumption outside of the organization
Energy intensity
302-3
302-4
Reduction of energy consumption
302-5
Reductions in energy requirements of products and services
GRI303 : Water 2016
303-1
Water withdrawal by source
303-2
Water sources significantly affected by withdrawal of water
303-3
Water recycled and reused
GRI304 : Biodiversity 2016
304-1
Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas
304-2
Significant impacts of activities, products, and services on biodiversity
304-3
Habitats protected or restored
304-4
IUCN Red List species and national conservation list species with habitats in areas affected by operations
GRI305 : Emissions 2016
305-1
Direct (Scope 1) GHG emissions
305-2
Energy indirect (Scope 2) GHG emissions
305-3
Other indirect (Scope 3) GHG emissions
305-4
GHG emissions intensity
305-5
Reduction of GHG emissions
305-6
Emissions of ozone-depleting substances (ODS)
305-7
Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions
GRI306 : Effluents and Waste 2016306-1
Water discharge by quality and destination
306-2
Waste by type and disposal method
306-3
Significant spills
306-4
Transport of hazardous waste
306-5
Water bodies affected by water discharges and / or runoff
GRI307 : Environmental Compliance 2016
307-1
Non-compliance with environmental laws and regulations
GRI308 : Supplier Environmental Assessment 2016308-1
New suppliers that were screened using environmental criteria
308-2
Negative environmental impacts in the supply chain and actions taken

SocialGRI401 : Employment 2016
401-1
New employee hires and employee turnover
401-2
Benefits provided to full-time employees that are not provided to temporary or part-time employees
401-3
Parental leave
GRI402 : Labor / Management Relations 2016
402-1
Minimum notice periods regarding operational changes
GRI403 : Occupational Health and Safety 2016403-1
Workers representation in formal joint management–worker health and safety committees
403-2
Types of injury and rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities
403-3
Workers with high incidence or high risk of diseases related to their occupation
403-4
Health and safety topics covered in formal agreements with trade unions
GRI404 : Training and Education 2016
404-1
Average hours of training per year per employee
404-2
Programs for upgrading employee skills and transition assistance programs
404-3
Percentage of employees receiving regular performance and career development reviews
GRI405 : Diversity and Equal Opportunity 2016405-1
Diversity of governance bodies and employees
405-2
Ratio of basic salary and remuneration of women to men
GRI406 : Non-discrimination 2016406-1
Incidents of discrimination and corrective actions taken
GRI407 : Freedom of Association and Collective Bargaining 2016
Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk
407-1
GRI408 : Child Labor 2016
408-1
Operations and suppliers at significant risk for incidents of child labor

97

Nissan Chemical Corporation Integrated Report 2018―
P45-46 Compliance
Not applicableNot applicable

Reference pageP53-58 Environment Safety and Climate Change Strategy――
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy―
P53-58 Environment Safety and Climate Change Strategy―
No water recycling / reuse
P59-60 Biodiversity Conservation―
P59-60 Biodiversity Conservation―
P53-58 Environment Safety and Climate Change Strategy
CO2 emissions from energy use, CO2 emissions from non-energy use
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy―
P53-58 Environment Safety and Climate Change Strategy

GRI409 : Forced or Compulsory Labor 2016
Operations and suppliers at significant risk for incidents of forced or compulsory labor
409-1
GRI410 : Security Practices 2016
Security personnel trained in human rights policies or procedures
410-1
GRI411 : Rights of Indigenous Peoples 2016
Incidents of violations involving rights of indigenous peoples
411-1
GRI412 : Human Rights Assessment 2016
Operations that have been subject to human rights reviews or impact assessments
412-1
Employee training on human rights policies or procedures
412-2
Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening
412-3
GRI413 : Local Communities 2016
Operations with local community engagement, impact assessments, and development programs
413-1
Operations with significant actual and potential negative impacts on local communities
413-2
GRI414 : Supplier Social Assessment 2016
New suppliers that were screened using social criteria
414-1
Negative social impacts in the supply chain and actions taken
414-2
GRI415 : Public Policy 2016
Political contributions
415-1
GRI416 : Customer Health and Safety 2016
Assessment of the health and safety impacts of product and service categories
416-1
Incidents of non-compliance concerning the health and safety impacts of products and services
416-2
GRI417 : Marketing and Labeling 2016
Requirements for product and service information and labeling
417-1
Incidents of non-compliance concerning product and service information and labeling
417-2
Incidents of non-compliance concerning marketing communications
417-3
GRI418 : Customer Privacy 2016
Substantiated complaints concerning breaches of customer privacy and losses of customer data
418-1
GRI419 : Socioeconomic Compliance 2016
Non-compliance with laws and regulations in the social and economic area
419-1

Not applicable―Not applicable――――Not applicable―――P63-64 Chemicals and Products Safety
Not applicable―P65-66 Relationships with Customers
Not applicableNot applicableNot applicableP53-58 Environment Safety and Climate Change Strategy
P53-58 Environment Safety and Climate Change Strategy
Not applicable――Not applicable――
Reference page

P9-10 Non-Financial Highlights―
P9-10 Non-Financial Highlights―
P71-74 Relationships with Employees
P61-62 Safety and Disaster Prevention, Occupational Safety and Health―P71-74 Relationships with Employees
P71-74 Relationships with Employees
P71-74 Relationships with Employees
P71-74 Relationships with Employees
P9-10 Non-Financial Highlights
Basic salary does not differ between women and men.
Not applicableNot applicableNot applicable

Nissan Chemical Corporation Integrated Report 201898

N I S SA N C H E M I C A L I N T E G R AT E D R E P O R T 2 018

https://www.nissanchem.co.jp/eng/

Printed in Japan

Integrated Report 2018