Creating a
Sustainable Society fora Better Future
Kintetsu World Express
Sustainability Report2023

A member of theGroupOur Sustainability Efforts in Progress
Striving to create a sustainable society for a better future

Contents
Introduction

SocialGovernance

KWE at a Glance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  3

Material Topics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Material Topics…………………………………………………………………………………… 32

Philosophy & Policies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  4

Data Security. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Anti-Corruption…………………………………………………………………………………… 33

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

Diversity and Equal Opportunity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Corporate Governance…………………………………………………………………… 34

KWE Stakeholders &Sustainability Governance Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7

Occupational Safety and Health. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Materiality Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

Environment

Social Impacts in the Supply Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Information

Social Contribution Activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

ESG Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Corporate Data. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Material Topics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Emissions & Energy— Disclosures Based on the TCFD Recommendations.. . . . . . . . . . . . . . 13
Emissions & Energy— Specific Initiatives & Topics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Emissions & Energy — Upcoming Initiatives. . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Editorial policy

Referenced guidelines

Report scope
Organizations: Kintetsu World Express, Inc. and its consolidated and equity method affiliates (includes Kintetsu World Express (non-consolidated)).
Period: Fiscal year 2022 from April 1 2022 to March 31 2023 (includes some information outside this period).

・GRI Sustainability Reporting Standards
・Environmental Reporting Guidelines 2018, Ministry of the Environment, Japan

Disclaimer regarding forward-looking statements
The forward-looking statements in this report are based on information currently available to us and certain
assumptions that we believe to be reasonable, and are not intended to be a promise by us that we willachieve these goals. Actual results may differ significantly due to various factors.

Kintetsu World Express Sustainability Report 2023

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Introduction

KWE at a Glance

Consolidated net sales and number of employees (FY2022)

We focus on both business growth and sustainability to help create a better future
The KWE Group conducts international logistics business through a network of 136 subsidiaries with 683 sites in 300 cities and 45 countries. KWE continues to see ongoing growth and increasing corporate value realized through active expansion and globalization.
The KWE Group is committed to helping create a better future with a focus on both business growth and sustainability.

1,080,949,000,000yen
18,552(Up 10.3% year on year)(Up 8.7% year on year)

Net sales and number of employees by business segment (FY2022)
We are increasing the scale of our business and freight volumes to achieve our vision to be a global top 10 solutions partner, a global brand born in Japan.
Air freight forwarding

Sea freight forwarding

339,281,000,000 yen(Up 12.5% year on year)

Share of total

Share of total

31.4%

42.7%

(Up 0.0% year on year)

OthersShare of total

Share of total

461,835,000,000 yen

Logistics

4.5%

21.4%

231,424,000,000 yen(Up 35.7% year on year)

48,409,000,000 yen(Up 4.3% year on year)

Sustainability highlights (Since FY2022 on)
We made progress on our material topics across the three ESG pillars in FY2022.

Environment

SocialGovernance■ Increased participation in Sustainable Aviation Fuel (SAF) programs■ Established KWE Group Occupational Safety and Health Policy■ Appointed Head of Group Compliance■ Obtained third-party verification of greenhouse gas emissions in■ Established KWE Group Diversity and Equal Opportunity Policy■ Established a new Audit & Supervisory Board in place ofJapan■ Established FY2030 reduction targets for Scope 1 and 2 CO₂emissionsprior Audit & Supervisory Board■ Announced Health and Productivity Management Declaration(Kintetsu World Express (non-consolidated))■ Established our global whistleblower hotline

Number of employees by segment (FY2022)
With a strong sense of responsibility and our customer-first approach, each employee will be focused on corporate sustainability and enhancing our on-site capabilities.

Europe, Middle East
& Africa

Southeast Asia
& Oceania

employees

employees

887

3,670

East Asia

3,476
employees

Japan

The Americas

employees

employees

2,769

1,521

APL Logistics

6,188
employees

Others41

employees

Kintetsu World Express Sustainability Report 2023

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Introduction

Philosophy & Policies
Prioritizing and integrating sustainability based on our Corporate Philosophy and the KWE Group Sustainability Basic Policy
We established the KWE Group Sustainability Basic Policy and started prioritizing sustainability as a Group in 2020.

Corporate Philosophy
Contribute to the development of a global community through logistics services by creating new value, sustaining the environmentand collaborating with our clients, shareholders and employees.

Corporate Guidelines
1. We strive to further increase corporate value by delivering customers quality services that meet their needs and earn their confidence.
2. We strive to be an organization that grows and expands through logistics business.
3. We promote communications with stakeholders and disclose corporate information accurately and appropriately.
4. We are committed to comply with external regulations while compliance monitoring and assessment are built into all levels of the business.
5. We ensure a safe and healthy work environment where people are treated respectfully and fairly.
6. We contribute to sustainable community development, with attention to global environmental issues.

KWE Group Code of Conduct
https://www.kwe.com/about/whoweare/policy/code-of-conduct/
KWE Vendor Code of Conduct
https://www.kwe.com/about/whoweare/policy/vendor-code-of-conduct/

KWE Group Sustainability Basic Policy
The KWE Group endeavors to create a sustainable society for a better future based on the Corporate Philosophy and KWE Group Corporate Guidelines.

Kintetsu World Express Sustainability Report 2023

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Introduction

Executive Summary
Steady and ongoing efforts in sustainability lead to stronger
competitive advantage and brand power, enabling continuing
growth and increased corporate value.
President & CEO

Nobutoshi Torii

Action on Sustainability So Far

Material Topic Initiatives:

The KWE Group Sustainability Committee, established in

Looking Back at FY2022 and Creating New Priorities in

FY2020, has been leading initiatives on sustainability, includ-

FY2023ing establishing the KWE Group Sustainability Basic Policy,

Working in line with global standards is a continuing priority

conducting a materiality assessment, and setting KPIs fromin our material topic initiatives.

FY2021 onwards. Our corporate culture prioritizes a custom-

Regarding our environmental initiatives, in FY2022 we suc-

er-first approach. It has been the foundation for addressing

cessfully sourced 100% renewable energy for our sites acrosssustainability in the context of daily customer contact by ourJapan with the purchase of Renewable Energy Certificate.

employees around the world, while at the same time we have

These efforts significantly reduced our Scope 2 emissions.

moved ahead with prioritizing sustainability on an integrated,

And moving toward Scope 3 reductions, we have beengroup-wide basis. In particular, the younger generation who

increasing our participation in Sustainable Aviation Fuel (SAF)

carry the future of the KWE Group are now highly aware of

programs worldwide in our air freight business. We are also

the importance of sustainability and have a strong will to fo-

promoting container round use and matching systems in ourcus on sustainability with a sense of personal responsibility.

sea freight business, expanding the use of hydrotreated veg-

Our global corporate efforts in sustainability with a cus-

etable oil (HVO) fuel for truck transport.

tomer-first approach and on-site capabilities are leading to

We will continue these efforts in FY2023 to reduce CO₂stronger competitive advantage and brand power, enablingemissions. KWE has set our FY2030 reduction targets forcontinuing growth and increased corporate value.

Scope 1 and 2 emissions and implemented a data tracking
Kintetsu World Express Sustainability Report 2023

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Introduction

system to mark our progress. We are working toward becom-

occupational safety and health, we established the KWE

ing carbon neutral by 2050. At this time we are also looking at

Group Occupational Safety and Health Policy and the KWE

initiatives to target biodiversity, which is closely linked to de-Group Occupational Safety and Health Regulations. These

carbonization.

form the basis for our activity in FY2023 which includes set-In the social pillar, for our material topic data security inting up a new Safety and Health Management Center as a

FY2022 we focused on improving employee training in cy-

group-wide structure. In Japan, we will be announcing our

ber-security. In FY2023 we will be conducting security assess-

Health and Productivity Management Declaration - Kintetsu

ments in line with the local requirements at our subsidiaries

World Express (non-consolidated), to pave the way for futurearound the world.

health management initiatives.

For our material topic of diversity and equal opportunity,

For our governance initiatives and regarding the material

in FY2022 we drafted the global KWE Group Diversity andtopic of anti-corruption, we conducted unified group compli-

Equal Opportunity Policy and we implemented global em-

ance training last year under the lead of our General Counsel.

ployee training in human rights and equal opportunity. We

In FY2023, we will appoint a Head of Compliance and ouralso recommended that our male employees take childcare

global whistleblower hotline will launch.

leave and expanded our continued education programs.

In line with our Management Plan 2027, our vision to be a

In FY2023 we will formally establish the KWE Group Diver-global top 10 solutions partner, and the drive to be a global

sity and Equal Opportunity Policy and increase disclosures re-brand born in Japan, we are following our business growth

lated to human resource investments. For our material topic

strategy and driving corporate sustainability. These efforts willof social impacts in the supply chain, we prepared and rolled

ensure ongoing growth and increasing corporate value.

out vendor requirements last year. In 2023, we will work on
setting up a framework for improving our human rights initia-

We ask for the continuing support of our stakeholders inthese endeavors.

tives, such as formally establishing a human rights policy. For

Kintetsu World Express Sustainability Report 2023

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IntroductionKWE Stakeholders & Sustainability Governance Framework
KWE Stakeholders

Sustainability Governance Framework

Aiming to achieve a sustainable society from the standpoint of our stakeholders
Over the 70 years the KWE Group has been working in international logistics, we have built
good relationships with our stakeholders that enable sustainable business growth.
Based on the KWE Group Sustainability Basic Policy established in November 2020 (seep.4), we are moving forward and contributing to a sustainable society for our customers,
employees, business partners and vendors, local communities, governments, shareholders
and investors*, and other stakeholders.

The KWE Group Sustainability Committee led by the President & CEO
The KWE Group Sustainability Committee is chaired by KWE’s President & CEO. Members
include the Company’s full-time board directors, regional headquarters general managers, corporate department general managers, a representative from APLL, and temporary
members appointed as needed. The committee drives effective action on sustainability
with regular monitoring, evaluation, and feedback surrounding ongoing initiatives.

Customers

Shareholders
and investors*

Corporate Management Meeting
Employees

KWE
Local communities
and governments

Consult and reportSupervise and instruct

Business partners
and vendors

KWE Group Sustainability Committee
Chair

President & CEO

Members

Full-time board directors, regional headquarters generalmanagers, corporate department general managers, and a
representative from APLL

Secretariat

KWE Corporate Planning & Administration
APLL Strategy Management & Administration

Environment* KWE became a privately held company on August 26, 2022 through a tender offer for the Company’s shares.

Kintetsu World Express Sustainability Report 2023

Introduction

8

Materiality Assessment
We conducted our materiality assessment through stakeholder engagement and impact assessment.

Stakeholder Engagement
Survey response
A total of 51 stakeholders, including customers, suppliers, service providers, KWE managers andemployees, labor union representatives, and investors answered an online survey on 21 important topics. The top 5 highest priority categories are shown below.
Priority

1
2
3
4
5

Category

Anti-corruption
Occupational safety and health
Data security
Training and education
Forced or compulsory labor

Score

ESG

8.57
8.52
8.38
8.29
8.21

Economic and governanceSocialSocialSocialSocialInterviews
Additionally, we interviewed over a dozen of the survey respondents, getting their opinion
as follows on specific risks and opportunities.
Key Issues/Risks

Environment

Climate change and CO₂ reduction■ Stricter regulation in EU and the U.S.
■ IMO CO₂ reduction targets for shipping■ Supply chain management■

Employee safety and health (overtime)
Diversity and inclusion■ Women at leadership level■ Involvement with local communities■

Demand for transparency and reporting
Emerging competition such as GAFA
■ Delays in technological innovation■ U.S.-China trade friction■■

Social

■We assessed material topics for the potential degree of impact of KWE business activities on
the environment and on society. We used over 60 different metrics to evaluate the potential impact on society, the economy, and the environment from industrial and geographic
perspectives. The top 5 highest priority categories are shown below.
Priority

Category

Score

ESG

1

Energy7.80

Environment2Social impacts in the
supply chain

7.30

Social3

Diversity and equal
opportunity

6.51

Social4

CO₂ emissions

6.49

Environment

5Effluents and waste

5.57

Environment

Sea container efficiency■ Low-carbon options for customers■ Alternative transport modes including rail
■ Alternative trucking solutions (such as
EV)

■

■

Other

Opportunities■

Impact Assessment

Technology to improve efficiency andreduce overtime

Improving customer relationships andincreasing sales■ Improving customer experience withnew technology■ More proactive management
Kintetsu World Express Sustainability Report 2023

Introduction

9

Analysis of Material Topics

Identification of Material Topics

KWE determined the highest priority categories to be addressed using a combination of feedback from our stakeholders and assessment of potential impact.

We identified the following six material topics most important to our stakeholders andcould have the highest social, economic, and environmental impacts related to our business. We have set goals and are implementing action plans for each topic.

10
Description

GRI Category

Anti-Corruption

Economic
and governance

Data Security

SocialDiversity and Equal
Opportunity

SocialEmissions

Environment

EnergyEnvironment

Social Impacts
in the Supply Chain

SocialSDG Mapping

9

STAKEHOLDER RATING

Occupational Safety
and HealthForced orCompulsory Labor

8

Anti-corruption

Eﬄuents
and Waste

Social Impacts in the
Supply Chain

EnergyLocal Communities

6

5

Diversity and Equal
Opportunity

Training and Education
Economic
Performance
Emissions

Employment

7

Data
Security

Water and Eﬄuents

0

2

4

6

8

10

POTENTIAL IMPACT
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Environment
The KWE Group is addressing the material topics of emissions and energy,
moving ahead step by step on a variety of measures to achieve carbon neutrality by 2050.
In FY2022 we took concrete action to reduce our Scope 1 and 2 CO₂ emissions, and in August 2023 we set FY2030 reduction targets for the entire KWE
Group.
We will continue to focus on environmental issues that must be addressed byfreight forwarders, in line with global standards.

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Environment

Material Topics
Emissions Reduce CO₂ emissions to address climate change
Energy Promote the use of green energy
Objectives

Progresses in FY2022■ Started collecting Scope 1 and 2 data for subsidiaries worldwide■ Setting KWE Group FY2030 Scope 1 and 2 emission reduction targets■ Obtained third-party verification of FY2021 Scope 1 and 2 data

■ Considering measures to further reduce Scope 1 and 2 emissions(Kintetsu World Express (non-consolidated))■ Achieved 100% renewable energy sourced power consumption at■ Reduce CO₂ emissions■ Promote the use of green energy

FY2023 Onward

our sites in Japan with the purchase of FIT non-fossil fuel energy
certificates■ Released KWE CO₂ Calculator estimating emissions associated withfreight transport■ Participated in 3 airline and 1 fuel supplier SAF programs■ Continuing to promote SAF and participate in SAF programs■ Implementing Scope 1 and 2 data collection system■ Promoting shifts to LED lighting■ Promoting rail transport■ Promoting the use of trucks fueled by hydrotreated vegetable oil(HVO)■ Promoted shift to LED lighting■ Promoting reusable containers for sea freight■ Promoted rail transport■ Submitting Science Based Targets initiative (SBTi) commitment letter■ Started using trucks fueled by hydrotreated vegetable oil (HVO)■ Promoted container round use for sea freight

Kintetsu World Express Sustainability Report 2023

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Environment

Emissions & Energy
Progress

Concept & Policy

Over the 75 years since its founding, the KWE Group has built an extensive global forwarding business network of 683 sites across 300 cities and 45 countries (as of March 31, 2023). All our sites worldwide are focused

KWE Group Environmental Policy
In addition to our corporate philosophy to contribute to the development ofa global community through logistics services, KWE Group sets forth the fol-on the short, mid, and long term targets that will result in achieving carbon neutrality by 2050. Short term initiatives in FY2022 included collecting data on a consolidated basis for group-wide electric power consumption, fuel use, and CO₂ emissions for our subsidiaries worldwide. We obtained third party verification of Kintet-

lowing policy to conserve the earth’s valuable natural resources and strive tosu World Express (non-consolidated) Scope 1 and 2 emissions. We also made progress in SAF use andpreserve the environment:

promoting reusable ocean container use in an effort to reduce our Scope 3 emissions.

1. We promote global pollution prevention.
2. We comply with the environmental protection laws, regulations, and requirements in each country in which we operate.
3. We define the following items as the key environmental management objectives related to business activities:■ Reducing greenhouse gas emissions

In the medium term, we set group-wide Scope 1 and 2 reduction targets in August 2023. The targets are
to reduce our emissions by 35% by FY2030 from FY2022. We submitted our commitment letter to SBTi. We
will be seeking third party verification of our Scope 1 and 2 CO₂ emissions worldwide while also aggregating
and verifying our global Scope 3 baseline.
By consistently pursuing our short and medium term goals, we will achieve our long term target of carbon neutrality by 2050.

・Reducing electricity consumption
・Reducing exhaust from vehicles and equipment■ Reducing waste and promoting recycling

4. We work to prevent environmental pollution in cooperation with clients,
affiliated companies, and subcontractors.
5. We make KWE group employees and the public aware of our environmental protection policy through internal and external communications.

35%

97,372 tons CO2e reduction target-34,080 tons
35%
63,292 tons

FY2030 reduction target(vs FY2022 Scope 1 and 2)

2050
Carbon neutral
FY2022

FY2030
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Environment

Emissions & Energy — Disclosures Based on TCFD Recommendations
Support of Task-Force on Climate-related Financial Disclosures (TCFD)
recommendations
In December 2021 KWE announced its support of the recommendations made by the TaskForce on Climate-related Financial Disclosures, an organization established by the Financial
Stability Board to consider the financial impacts of climate change on business and financial
planning. We analyzed the risks and opportunities for our business associated with climatechange and continue to provide information to our stakeholders about the potential financial
impacts. At this point in time our scenario analysis is as follows.

Governance
The KWE Group Sustainability Committee, headed by the President & CEO, addresses basic
policy, material issues, and risks and opportunities related to climate change. The committee
meets at least twice a year, with additional meetings as necessary. The committee met fourtimes in FY2022. The topics related to climate change that were discussed are shown below(FY2022 Agenda).
Committee members include our company directors, corporate department generalmanagers, regional headquarters general managers, and representatives from APLL, ensuring
diversity in its deliberations. Matters discussed and decided by the committee are presented
to the Corporate Management Meeting*1 and reported to the Board of Directors as needed.
Under the oversight of the Board of Directors, matters discussed and decided by the Corporate Management Meeting are disseminated to all divisions within the organization andreflected in their management plans and business operations.

Strategy
We have identified climate change as a mid to long term risk. We have analyzed long term
scenarios to 2050 for potential impact on our business, with reference to International Energy
Agency (IEA) and Intergovernmental Panel on Climate Change (IPCC) scenarios (Below 1.5°C*2
and 4°C*3) for risks and opportunities in order to consider the resilience of our business strategy and organization. (See p.14)

Risk Management
Our climate change-related risk working group is planning, implementing, and managing the
progress of our response to the risks and opportunities we have identified. Scenario analysis
began in February 2022 and is reviewed at least once a year. We are focusing on addressing
the risks and opportunities shown below on p.14 based on likelihood and degree of impact.
Climate change related risks will continue to be analyzed by the KWE Group Sustainability
Committee, reported to the Corporate Management Meeting, and integrated into our overallrisk management.

Metrics and Targets
We are using GHG emissions (CO₂e) as a metric to assess and manage the impact of climate-related risks on our business. We set the following FY2030 reduction targets for theKWE Group in August 2023. Scope 1 and Scope 2 emissions in FY2021 and FY2022 were:Emissions

FY2022 Agenda related to climate change
・Deliberation on Sustainable Aviation Fuel (SAF)
・Deliberation on TCFD recommended disclosures
・Deliberation on committing to SBTi (Science Based Targets initiative)
・Report on greenhouse gas emissions calculator for customer use
・Report on activity to reduce greenhouse gas emissions, including shift to LED lighting, shift to electric
forklifts, and purchasing of non-fossil fuel energy certificates・Progress report on collection of greenhouse gas emission data
*1: The Corporate Management Meeting is composed of the Company’s full-time directors, full-time Audit & Supervisory Board members, executive officers, and division managers. It meets at least twice a month to decide important matters related to overall business policy and the conduct of business.
*2: Below 1.5°C: IEA SDS, IPCC AR6, RCP2.6, etc.
*3: 4°C: IPCC AR6, RCP8.5, etc.

Scope 1

Targets

Scope 2

FY2021462 t

6,479 tFY2022345 t
50,649 t*

6,251 t46,723 t*

Scope 1 and 2
FY2030 35% reduction from FY2022
FY2050 Carbon neutrality* Include KWE Group companies. The rest are Kintetsu World Express (non-consolidated).

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Environment

Assessing and Managing Climate-related Risks and Opportunities (Scenario Analysis)
Category

Policy and
Legal

Risk

Carbon tax

Next generation air,sea, and land vehicles
Technology
New fuels (such as SAF
and bio-fuel)Transition Risk

MarketReputation

Modal Shift

Corporate environmental reputation

Business Impact

Timeframe

1.5°C
Scenario

4°C Scenario

Strategy❶ Set GHG emissions targets and fulfill them on an ongoing basis❷ Shift to eco-friendly vehicles and electric forklifts❸ Change to renewable energy source electric power❹ Pass along freight charges appropriately

Risk: Higher operating costs due to stricter national environmental regulations

Mid - long
term

High

Low

Risk: Higher operating costs due to development and introduction of new technologies

Short - long
term

High

Low

Opportunity: Lower carbon tax and other regulatory costs with
reduced GHG emissions

Short - long
term

High

MediumRisk: Slower adoption and higher procurement costs with inadequate supply

Short - mid
term

High

Low

Opportunity: Lower carbon tax and other regulatory costs with
reduced GHG emissions

Mid - longterm

MediumLow

Risk: Reduced revenue due to increase in use of sea and rail withhigher demand for transport modes with less impact on theenvironment

Short - mid
term

High

MediumOpportunity: Development of new services and expandedbusiness areas

Short - midterm

MediumLow

Risk: Reduced revenue due to loss of orders and exclusion frombidding with falling reputation, negative impact on recruiting

Short - mid
term

High

Low

Opportunity: Increase in revenue by acquiring more businesswith improved reputation, increase in opportunities to hire
talented human resources

Short - mid
term

High

Low

❶ Plan investments while monitoring social trends and newtechnology❷ Participate in pilot programs and consider implementation
while evaluating cost
❶ Actively participate in SAF programs and promote social
implementation❷ Approach governments and associations toward increasing
adoption in the industry❶ Develop sea and rail transport services in line with customer
needs and build a business model adapted to the changing
market❷ Develop low environmental impact air transport products
leveraging SAF in collaboration with airlines❸ Propose low CO₂ emission routes and transport modes leveraging AI❶ Work on improving reputation with customers by including
active environmental initiatives in business strategy

Acute

Extreme weather

Risk: Reduced revenue with fall in freight volume due to difficulty in providing transport services and increased recovery costs

Short - mid
term

Low

High

❶ KWE and service providers respond to flood and other damage in the case of logistics warehouses owned by KWE, andKWE coordinates with lessors to respond in the case of rented
warehouses❷ Select alternative forwarding warehouse facilities and routes
to build a stable logistics network❸ Manage risks in coordination with the KWE Risk Management
Committee

Chronic

Rising sea levels withrising average airtemperature

Risk: Difficulty using ports and airports in low elevation areas.
Also limited usable facilities.

Mid - long
term

Low

High

❶ Work with local authorities and business partners to respondto flood and other kinds of damage❷ Manage risks in coordination with the KWE Risk Management
Committee

Physical Risk

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Environment

Emissions & Energy — Specific Initiatives & Topics
Decarbonizing with Electric Forklifts
Almost 75% of the forklifts
required for KWE Groupterminal operations are already running on battery
power. We are continuing
to change those still relying
on fossil fuels such as gasoline, diesel oil, and LPG toelectric power.
KWE Ireland has been
moving ahead on replacing
fossil fueled vehicles with electric-powered vehicles and rechargeable electric forklifts in order to achieve:● Reduced operational emissions● Reduced running costs● Reduced maintenance costs● A greener, healthier work environment

Power Consumption by All KWE Sites andAffiliated Companies in Japan is Now 100%
Renewable Energy Sourced
We are working on a number of initiatives to reduce Scope
2 CO₂ emissions associated with our energy consumption. In March 2023 Kintetsu World Express (non-consolidated) purchased FIT non-fossil fuel energy certificates(with tracking)*1 totaling 29
million kWh, which reduced
our Scope 2 CO₂ emissions byapproximately 11,600 tons*2
in FY2022 to essentially zero.
We will continue this initiative
to shrink our CO₂ emissions
in Japan, as well as others to
reduce emissions from ourbusiness activities worldwide.
Renewable Energy Certificate

Using the Green Power Certificate System
and Supporting Renewable Energy
In 2022 we purchased a Green Power Energy Certificate*3
for 1,200,000 kWh of electric power for use at our Misato
Green Warehouse in Japan. The Misato Green Warehouse
is ISO 14001 certified for environmental management andhas obtained LEED certification*4 for its green roof and walls,
LED lighting, and other measures to protect the environment.

Green Power Certificate*1 FIT non-fossil fuel certificate: A certificate attesting to the environmental value of not emitting CO₂, including through electricity generated from non-fossil fuel sources such as solar power, wind power,
and biomass.
*2 Greenhouse gas tonnage calculated using electric power company adjusted emission factors.
*3 The Green Power Certificate System is a framework for trading renewable energy certificates that represent the environmental value of renewable energy. Certification is conducted by the Japan Quality
Assurance Organization.
*4 LEED: Leadership in Energy and Environmental Design. Certification issued by the U.S. Green Building Council based on building operations, site management, energy efficiency, and other evaluation
categories.

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Environment

100% Renewable Energy at Our
Headquarters in Japan
Our headquarters in Japan are located in the Shinagawa Intercity in Tokyo. The building has earned superior ranking
from the environmental performance Comprehensive Assessment System for Built Environment Efficiency (CASBEE)
certification, and all the power consumption at this locationfrom April 2022 onward is obtained from 100% renewableenergy sources. In addition to improvements in the energy efficiency of the local area heating-cooling system, KWE
switched to LED bulbs for shared lighting. Renewable energy sources for electric power, such as solar, can also beleveraged for RE100*1, when the environmental value is certified and tracked with renewable fuel certificates*2 leading
to further reductions in our Scope 2 emissions.

Other Initiatives Across Our Global Sites
Below are some other initiatives we are taking to reduce
emissions at our facilities worldwide with the aim of decarbonizing and reducing the risks of climate change.
Narita Terminal and Penang Logistics Center
We started generating solar power for use at our Narita Terminal in 2009. From 2017 to 2019 we replaced a total of 40
warehouse air conditioners with more efficient models andupdated the office air conditioning equipment in 2020, resulting in reduced CO₂ emissions.
Our Penang Logistics Center in Malaysia installed a so-lar power generating system in January 2023, generating
enough energy to cover about 40% of the center’s electricity consumption.
LED Lighting and Updated Elevators
LED bulbs are more energy efficient and have longer lifespans than their fluorescent counterparts, resulting in lower
CO₂ emissions. We are now shifting to LED lighting inside
all our terminals worldwide. The change reduces safety andquality risks. We are also planning to update to high efficiency elevators at No.2 Baraki Terminal and Osaka Nanko
Terminal.

Third-party Verification of GHG Emissions
In December 2022, our FY2021 GHG emissions and energy
consumption figures (KWE non-consolidated) were verified
by SGS Japan based on ISO14064-3:2019 standards. We willcontinue to ensure accuracy and reliability of our emissions
data through third party verification as we move ahead on
reducing CO₂ emissions.
April 1 2021–March 31 2022 Scope 1 and 2 greenhouse gas emissions andenergy consumption (Kintetsu World Express (non-consolidated))

Narita Terminal solar power generation

Penang Logistics Center solar panels

Kintetsu Logistics Systems Yokkaichi Terminal
LED lighting*1 RE100: A collaborative initiative in which businesses commit to 100% renewable energy for the electricity they use in their operations. By bringing together businesses as consumers, it is intended tosend a signal to policymakers and investors to accelerate the energy transition.
*2 Non-fossil fuel certificate: A certificate attesting to the environmental value of not emitting CO2, including through electricity generated from non-fossil fuel sources such as solar power, wind power,
and biomass. Tracking information includes the identification of the type of energy source and the specific power plant generating the energy.

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Environment

HVO Fuel for Truck Transport

LED Lighting - FY2022
Country

Expected Reduction in Emissions

Japan

5.63t CO₂/yr

U.S.

5.48t CO₂/yr

China*2

14.1t CO₂/yr

Taiwan9.51t CO₂/yr

Singapore

10.45t CO₂/yr

Malaysia

0.23t CO₂/yr

Philippines

0.89t CO₂/yr

*1

Total

46.29t CO₂/yr*1. Kintetsu Logistics Systems Yokkaichi Terminal, Kintetsu Cosmos HQ office*2. KWE Shenzhen, KWE Zhongshan

We are promoting the use of hydrotreated vegetable oil(HVO) fuel for trucks to reduce our Scope 3 CO₂ emissions.
The use of HVO vegetable and waste cooking oil as a sustainable, non-fossil fuel for trucking has many benefits:• Up to 90% reduction in GHG emissions compared to conventional diesel fuel• Functions well in every kind of diesel engine, without
modifications• HVO is odorless, contributing to a pleasant working environment• Easy to use in lower temperatures with reduced exhaust
outputs• Easy to store without diminished quality• Helps reduce noise levels by
1 - 3 dB at all times compared
to conventional fuelThe widespread use of thistype of alternative fuel is advancing, particularly in Europe.
We are promoting the use of Truck transport using HVO

HVO to reduce our Scope 3 CO₂ emissions.
KWE Benelux started providing HVO fueled truck transport to major high-tech customers in February 2023, reducing trucking emissions by 90%.

Reusable Containers and Matching Services
We are promoting reusable container use and matching
service for sea freight to help reduce Scope 3 emissions.
Reusable containers in this context means using empty import containers for export from the destination instead ofimmediately returning them to the origin. This techniquereduces the cost of shipping and the burden on the environment. Container matching services find the optimal
match between an empty container and export cargo, facilitating container reuse.
KWE Indonesia was able to reduce annual GHG emissions by 35 tons in FY2022 by reusing contains with the helpof matching services. We will roll out the use of this technique to more sites worldwide to reduce our Scope 3 CO₂emissions.

Container Matching Services

After arrival, imported freight is devanned*3 at customer site A

The empty container is moved to customer site B, matched to optimal export cargo
and then exported*3 Devanning: Unloading a container

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Environment

Promoting Shift to Rail Transport

KWE CO₂ Calculator

KWE Thailand is Recycling Resources

Shifting shipping transport modes from air, sea, and truck
to rail where possible is an effective way to reduce KWE’s
Scope 3 CO₂ emissions . In May 2021, KWE Japan began actively pursuing domestic rail shipping options, both to reduce environmental impacts and to secure domestic cargocapacity.
In collaboration with Japan Freight Railway Company,
we provided rail transport to a customer in July 2022 that
had previously been using trucking to ship from Tokyo to
Niigata. This solution was possible in light of increasingawareness of the importance of decarbonization, and as away to address the 2024 problem*1 concerning trucking inJapan. The customer was eager to collaborate, stating thatthey wanted to help fulfill their social responsibility as a corporation, despite lead times for rail being longer than those
associated with trucking. Niigata is about 350 km away fromthe Port of Tokyo. Using rail instead of trucking between
these locations reduced per-shipment emissions by 75%.
We will continue to actively offer our customers the optionof rail instead of truck for long-distance transport in order toreduce Scope 3 CO₂ emissions.

The KWE CO₂ Calculator went online in June 2022, providing customers with estimated CO₂ emissions for their air
and sea shipments and helping to visualize Scope 3 emissions, as part of our worldwide decarbonization efforts. The
online calculator uses data from EcoTransIT World provided
by IVE mbH*2, using shipment origin, destination, and cargovolume inputs. KWE customers can enter their shipment
waybill number to get an estimate. As part of its responsibility as a freight forwarder, KWE is working on setting specifictargets and goals to reduce direct CO₂ emissions from its
operations (Scope 1 and 2). We are also taking the first step
to reduce our indirect emissions (Scope 3) that result from
customer use of KWE-purchased airline and ocean carrier
services by enabling the visualization of greenhouse gas
emissions using the KWE CO₂ Calculator.

In June 2022 KWE Thailand joined Canon Marketing (Thailand) Co., Ltd. in a corporate social responsibility activity,
presenting Canon with plastic bottle caps for its charitable recycling program. The bottle caps are recycled, after
which the plastic is re-processed to make items like tableware. These items are then donated to orphanages or forother charities. In October 2022, KWE Thailand donatedplastic drink bottles to a Buddhist temple that is in chargeof a recycling program to help protect the environmentand recover resources. The plastic bottles are made into
synthetic fiber which is used to make clothing or and small
cloth items. KWE Thailand will continue participating inthese kinds of activity in the future and increase its efforts
to recycling resources.

Canon Marketing (Thailand) and KWE Plastic bottles collected for recycling
Thailand employees
KWE CO₂ Calculator*1. 2024 problem: Truck driver overtime will belimited starting in 2024 by the Work Style Reform Law, creating problems for the logistics
industry.

Rail transport (terminal station image)*2. The EcoTransIT World CO2 calculator provided by IVE mbH is used by over 120 international
freight forwarders and other global enterprises to estimate greenhouse gas emissions attributable to cargo transport.

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Environment

Biodiversity
Reduced Use of Paper
KWE is actively reducing the use of paper documents in its
operations. This initiative serves not only to reduce the environmental impact of operations but also to improve service
quality with reduced operation times, higher employee
and customer satisfaction, and more business in the future.
Kintetsu World Express in Japan has been working on
digitizing internal forms and procedures since 2021. The
company is seeing positive results from improved efficien-

Reducing use of paper

Higher quality operations

More efficient operations
Shorter working hours and less overtime

cy while saving over 50,000 sheets of paper annually.
KWE recently performed a trial run of automaticallyselect documents to the customer in electronic format instead of paper. This trial resulted in clear benefits including
fewer delays at KWE and fewer reminders from customers.
“Going paperless” also creates the opportunity to streamline verification and other manual operations as well, foreven higher quality in the future.

Business Cards from More Sustainable
Material
In October 2021 Kintetsu World Express in Japan changed
to business cards made from the limestone based material
Limex* instead of paper. Using Limex saves 10 liters of waterfor every box of 100 cards compared to paper, and unused
cards - for example, due to HR transfers - can be recycled
into new cards. This helps raise awareness of global warming and other environmental issues among employees aswell as contribute to KWE’s sustainability efforts.

KWE Thailand Participates in Wild Bird
Protection and Tree Planting
In October 2022 KWE Thailand participated with Canon
Marketing (Thailand) in a joint corporate social responsibility activity with the Bird Branch Project to protect wild
birds at the Si Nakhon Khuean Khan Botanical Garden in
the outskirts of Bangkok. KWE employee constructed birdhouses from recycled wooden pallets donated to the botanical garden. Over 70 participants, including 9 from KWE
Thailand, put up birdhouses around the botanical garden,
planted trees, and fertilized the land. KWE Thailand intends
to continue participating in these kinds of activities to promote biodiversity.

Higher employee satisfaction
Higher customer satisfaction

Increased freight volume
Creating a more sustainable society

Bird Branch Project* Limex was developed and is produced
and distributed by TBM Co., Ltd.

Business card printed on Limex

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Environment

Emissions & Energy — Upcoming Initiatives
Participating in SAF Programs to Reduce Scope 3
CO₂ Emissions

Promoting SAF Use in the Future

To fulfill our responsibility as a freight forwarder, we are addressing Scope 3 emissions by expanding our participation in sustainableaviation fuel (SAF*1) programs. Scope 3 emissions account for the large majority of our emissions profile.
*1 Sustainable aviation fuel (SAF) is produced from dry biomass, waste cooking oil, animal fat, and other replenishable resources, reducing life cycle CO₂ emissions by approximately 80% compared toconventional jet fuels.

SAF Program Participation and Scope 3 Emissions Reduction Projects

September 2021
October 2022

April 2022

October 2022

March 2023

Business
partner

All Nippon Airways

Cathay PacificAirways

Lufthansa Cargo AG

Shell Aviation

Program

SAF Flight Initiative:
For the Next Generation

Corporate SAF Pilot
Programme

Sustainable Choice- Bulk Agreement

SAF Book-and-Claim
Pilot Program

The first full-scale corporate
customer SAF program in
Asia (both passenger andcargo)

100% carbon neutral transport accounting for emissions
from fuel production to
departure airport

Uses blockchain technology
to ensure secure allocationof SAF’s environmental
attributes to companies andairlines

Date

KWE used the first SAF
cargo flight out of Japan
Highlight

Air freight accounts for just under 50% of KWE Group consolidated net sales, but it is the majority contributor to ouremissions profile. We will continue actively leveraging SAF
programs to reduce our Scope 3 emissions and to provide
our customers with low carbon options.
At this time the Japanese SAF program business model,that KWE is a part of is still undeveloped compared to European and the U.S. markets. We are taking several different
approaches in the industry in Japan and neighboring countries.
As part of our creative effort, in February 2023, we participated as a forwarding industry representative in a SAF
symposium panel discussion held by the Ministry of Land,
Infrastructure, Transport and Tourism and the Agency of
Natural Resources and Energy. The panel discussed the future of aviation decarbonization, with regards to SAF, andKWE offered our opinion and discussion points on the presented issues.

Left: Toshiya Teramoto, Sustainability Group, Corporate Planning and Administration, speaking as a representative of the forwarding industry.
Right: The lively panel discussion on the topic of what is needed to increase
opportunities for SAF use.

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SocialThe KWE Group is addressing three material topics within the social pillar:
data security, diversity and equal opportunity, and social impacts in the supply chain. In FY2022 the Group moved forward on cyber security, diversity,and occupational safety and health, while Kintetsu World Express (non-consolidated) began taking action on health and productivity management.
The KWE Group will continue working on these material topics to enableongoing corporate growth and increasing corporate value while contributing
to a sustainable society.

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SocialMaterial Topics
Data Security
Objectives

Progresses in FY2022

FY2023 Onward■ Implemented cyber-security measures■ Implementing cyber-security measures■ Improve information security architecture■ Periodic security assessments by a third-party■ Periodic security assessments by a third-party■ Increase employee awareness of informa-■ Reduced data center, server, and network risks■ Reducing data center, server, and network risks■ Educated and trained employees (phishing email drills and security■ Educating and training employees (phishing email drills and security

tion security

training, each three times a year)

training, each four times a year)

Diversity and Equal Opportunity
Objectives■ Promote equal opportunity in promo-tion to management■ Promote hiring from minority groups■ Promote educating employees abouthuman rights and equal opportunity

Progresses in FY2022

FY2023 Onward■ Women in management positions across the Group: 34.3%■ Establishing KWE Group Diversity and Equal Opportunity Policy■ Educated employees about human rights and equal opportunity■ Moving ahead on activity in line with local characteristics

though e-learning

Social Impacts in the Supply Chain
Objectives

Progresses in FY2022■ Assessed procurement and identified priority areas (occupational■ Fulfill supply chain ethical, social, andenvironmental responsibilities

safety and health, labor, vendor management, and environmental
compliance)■ Occupational safety and health checklist (37 items in 7 areas)

FY2023 Onward■ Providing checklist to suppliers and do survey■ Supplier management framework

Kintetsu World Express Sustainability Report 2023

Social23

Data Security
Progress

Concept & Policy

The KWE Group is committed to ongoing improvement of our information security tomaintain the confidence of our customers, business partners, and other stakeholders.

The KWE Group handles customer, personal, and business-related information during the
conduct of business and established the KWE Group Information Security Basic Policy in2007. In 2020 the KWE Group established the KWE Group IT Security Policy conforming to
the ISO 27001 standard to improve the security management framework.
KWE Group Basic Policy on Information Security

KWE Group will run our business operations successfully and continuously improve information security in order to increase stakeholders’ trust, while maintaining confidentiality,
integrity, and availability of information assets. Our Basic Policy includes the following:
1 Build organizational structures to improve our information security
2 Comply with all information security laws, regulations, and other internal rules
3 Regularly evaluate and re-examine measures for information security
4 Reliably protect information assets against threats (unauthorized access, computer viruses, etc.)
5 Take measures aimed at enabling the rapid recovery of business activities from setbacks andnatural disasters

After establishing the KWE Group IT Security Policy in 2020, in 2021 we assessed security levels, built a security management framework, and began employee educationand training. In 2022, we focused on standardizing our IT infrastructure and implementing periodic assessments.
The business environment continues to change rapidly, and threats to corporate IT
security are becoming more clever and more advanced. Appropriate and timely measures must be exercised on an ongoing basis.
Specifically, we are moving forward and building a zero trust security platform, utilizing services that can guarantee security in the cloud, and educating users such as
employees and business partners about how to counter threats.
IT security remains an important area to be addressed, and it is critical to the sustainability of the KWE Group and its stakeholders.

KWE Group IT Security Policy
Summary● Establishing appropriate local IT security policy, planning, and governance●

Implementing appropriate security controls●

Regularly reviewing the suitability, adequacy, and effectiveness of the security controls●

Improving the suitability, adequacy, and effectiveness of the security controls

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SocialCyber-security

Employee Education

Periodic Security Assessments

We install and implement hardware and software cyber-security including entrance control, exit control, and vulnerability prevention measures. In addition to server management, we always monitor potential security anomalies
24/365, with prompt discovery and corrective action in theevent of an incident.

E-learning for employees on information security was held
three times in FY2022. Considering the rising trends inphishing emails, drills were held three times in FY2022 as
well.

KWE Group data security undergoes regular third-party assessments, with any required improvements planned andimplemented by information security experts.

Employee Education (FY2022 on)
When

Content

June - July 2022

Phishing email drills: All sites (10,765 employees)
Information security e-learning

November - December 2022

Phishing email drills: All sites (11,994 employees)
Information security e-learning

February - March 2023

Phishing email drills: All sites (12,363 employees)
Information security e-learning

Other Risk Reduction Measures
We use decentralized data centers, cloud resources, and redundant network lines to minimize cyber security risks andensure availability. Each Group company’s outward facing
servers undergo vulnerability scans to reduce the risk of
breach of confidential information.
We are also implementing functions that use AI and big
data to counter malware and spam email, and KWE uses
automated processes to speedily deal with threats that aredetected.

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SocialDiversity and Equal Opportunity
Concept & Policy
We respect the individuality of our employees, do not tolerate discrimination in any form, and provide equal opportunities for everyone to play an active role. The KWE Group Code of Conduct explicitly provides for equal employment opportunity, and the KWE Global HR Guidelines (established in 2020) for diversity and equal opportunity. In
FY2023 we established the KWE Group Diversity and Equal Opportunity Policy as a concrete basis for moving aheadon this important material topic.
KWE Group Code of Conduct 8. Equal Employment Opportunity
The Company has always been, and continues to be, committed to providing equal employment opportunity to all
its employees and applicants for employment.
As a result, it is the policy of the Company to hire, train, promote, compensate, and to administer all of its personnel policies without regard to race, color, national origin, citizenship, religion, sex, age, disability, marital status,
veteran status, sexual orientation, genetic information or any other characteristics protected by applicable laws.
All employees are responsible for complying with this policy. As a condition of employment, every employee isto treat all other employees equally and fairly.­KWE Group Diversity and Equal Opportunity Policy (excerpt)
1. Purpose
The KWE Group strongly believes that the values of diversity, equity, and inclusion are essential for our corporate sustainability.
Collaboration among employees from various backgrounds is a significant factor in our corporate culture, reputation, and achievement. It is a part of the KWE Group DNA, which has driven the growth of our business globally from the beginning.
As in the past and so into the future, our people are the most valuable asset we have. We firmly believe that this policy will increase the power of our diverse employee base worldwide. As KWE Group business continues to grow, our commitment to equal
opportunity will enable our companies to contribute to local and global society as a good corporate citizen.
2. Scope
This policy applies to all employees of KWE Group companies, to the workplace and to work-related events organized or sponsored by the company.
3. Basic Policy(A) Diversity - respect for diverse individuality (B) Equity - equity and equal opportunity (C) Inclusion - an inclusive work environment
4. Employee Responsibility
For more information about diversity initiatives, see:https://www.kwe.com/about/sustainability/worker/

Action Plans and KPI
We are focusing on the following actions:●Support, develop, and engage a pipeline of talented women in order toencourage equality in promotion to managerial positions●

Promote the recruitment and retention of employees from minority, marginalized, and underrepresented groups●

Educate employees about human rights and equal opportunity

The following are our diversity and equal opportunity KPIs:
Support, develop, and engage a pipeline of talented women in orderto encourage equality in promotion to managerial positions
・Establish KWE Group Diversity and Equal Opportunity Policy
Create an environment of diversity and mutual respect
・Create a workplace environment with no discrimination or harassment
・Implement human resources measures that respects diversity and individuality so that every employee can demonstrate superior competency intheir role
Improve training on preventing harassment and on diversity andinclusion
・Participation in harassment prevention training: 94.66% (October - December 2022)
・Participation in diversity and inclusion training: 95.57% (October - December 2022)

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SocialPercent of childcare leave of absence
taken by male employees(Kintetsu World Express (non-consolidated))

36.4%

QUOTE
I gained a lot from childcare leave.
The birth of my second child was going to drastically increase theamount of time needed for child care and housework at home. So I
believed I needed some time to devote to my wife and my family.
The new law in Japan promoting paternity leave in October 2022
created support from society and public opinion. I felt that taking paternity leave was a “must do” and didn’t hesitate. I talked with my supervisor about 6 months beforehand about when and how long I
would be gone on leave, and about 2 months beforehand I spenttime preparing people to cover my job. I’m grateful to everyone whocovered for me and allowed me to spend valuable time with my family. During the month I was on leave, I experienced how much work
child care is, and now that I am back in the office I can arrange myschedule to work more efficiently and better balance my responsibilities on the job and at home. I feel that I gained a lot from taking
childcare leave as I continue to work in
the future.

Promoting Diversity and Inclusion, andPreventing Harassment

Formal Learning and Career Development as
Investment in Human Resources

Between October and December 2022, we conductede-learning for all KWE Group employees on diversity and inclusion and preventing harassment. Training was also held
for Kintetsu World Express employees in FY2022 on understanding and preventing power harassment. We are aiming
for everyone in both management and employee roles totake individual action to build a workplace that is welcoming to all persons.

Through investments in our human resources, KWE has
promoted formal learning. Programs consist of customized
training and development courses that use facilitated programs and learning events to help grow employees into
top contributors and to build on their experiences and expectations. For example, we encourage the use of LinkedIn
Learning for reskilling (when the technical requirements required for a job have significantly changed) and for upskilling (to upgrade performance at one’s current job).
In April 2022 we started a new career development
program for employees who have been at Kintetsu World
Express (non-consolidated) for a minimum of 3 years. The
program’s purpose is to effectively leverage our human resources and grow both the individual and the organization.
The program has no prerequisites for enrollment, and thegoal is to encourage our employees to think about theirown career and provides a place whereindividual aspirations
are respected.

Talent Acquisition in Line with Diverse Local
Demographics and Cultures Around theWorld
The KWE Group is committed to promoting diversity in talent acquisition in line with local demographics and culturesto promote business growth and secure human resources.
For example, there is a large aging population in Japan,
so we introduced the KWE Life Shift Support Regulatory
Guidelines in FY2021 to support employment of older employees. In the U.S., APLL offices are actively hiring members of diverse groups through an internship program.

Keihin Export Sales Office
Assistant Manager

Ryuto Komatsu

Training image

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SocialOccupational Safety and Health
Basic Policy
The KWE Group Code of Conduct explicitly provides forthe safety and health of all our employees. The KWE Groupfocused on the employee-level protections and concerns,
earning an ISO 45001 certification in Hong Kong, etc. In
August 2022, we established the KWE Group Occupational Safety and Health Policy and Regulations to address
improving employee safety and health at the global level.
Based on these Regulations, the KWE Group Safety and
Health Committee meets regularly to oversee ongoing improvements in the work environment.

Driving ForceThe KWE Group Health and Safety Committee has several agenda items. The Committee regularly reviews reports
from regional headquarters and APLL on major work-related injuries and illnesses, sets Group goals related to occupational safety and health, plans and monitors the progressof action plans, and evaluates and plans improvements insafety and health initiatives. The regional headquarters and
APLL have the following responsibilities with respect totheir affiliated companies:• Deliberate measures required for safety and health management
Track progress while evaluating and planning improvements ininitiatives

KWE Group Code of Conduct 12. Safety and Health

KWE Group Occupational Safety and Health Policy

The safety and health of each employee is critical to theCompany and it is encouraged that all employees share in
the commitment to a safe and healthy work environment.
Each employee is responsible for immediately reporting
any accidents, injuries or unsafe working conditions andmaintaining a safe and healthy work environment. Workplace violence, any threatening behavior and all forms of
unlawful conduct will not be tolerated.

The KWE Group aims to enable employees to work in a safeand healthy environment where they can fully demonstrate
their abilities, and provide maximum value to our customers
and to society as a whole.

• Collect safety and health risk assessments performed by their affiliated companies and give guidance as needed• Track the status of work-related accidents and incidents and checkthe status of preventative measures• Report any major work-related injury or illness (death or absencefrom work of one month or longer) to the Chief Safety and Health
Officer without delay

1) KWE Group directors and employees act with safety andhealth as their first priority.
2) KWE Group directors and employees comply with laws
and company regulations related to safety and health.
3) The KWE Group identifies hazardous factors and takes
measures to avoid or reduce the risk of harm to safety andhealth.

Occupational Safety and Health Organizational Framework
Occupational Safety and Health Committee
President & CEO
Chief Occupational Safety and Health Officer
Secretariat
Corporate Human
Resources

FY2022 Action
In FY2022, we surveyed the status of safety and healthmeasures provided by the KWE Group Occupational Safety
and Health Regulations, assessed occupational safety andhealth risks, and drafted improvement plans, and created areporting framework for work-related injuries and illnesses.

Heads of Corporate
Departments

Heads of Regional
Headquarters

APLL
Representative

Occupational Safety and Health LeadersAffiliated Companies
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SocialHealth Management

Initiatives

In April 2023, Kintetsu World Express (non-consolidated) issued its Health and Productivity Management Declaration,
stating the commitment of top management to address thisimportant area. The Declaration comes as the health of KWE
employee is a tenet of the company’s business philosophy.

The foundation of our organization approach to employee
occupational health and safety relies on an occupational
health physician, the occupational safety and health committee, occupational health administrators, and leaders established in compliance with the Industrial Safety and Health
Health Activities

Kintetsu World Express Health and Productivity Management Declaration■ The physical and mental health of our employees supports the core of our business, and maintaining and improving employee health is an important ongoing management initiative.
■ Our healthy and energetic employees create new value
and contribute to global society.

Increase rate of employees taking healthexams, recommend full health exam••

Employees taking health exams: 100%
Increase rate of employees taking full healthexam
Support balance between illness and work

Adapt to diverse work styles

Establish support through return to work after
leave of absence• Inform employees of support structure

Chief Health and Productivity Management Officer
President & CEO
General Manager, Corporate Human Resources

Share information on preventing
lifestyle-related disease
Health insurance association public relations• Talks on lifestyle-related diseases by health nurse
at the occupational safety and health committee• Call to participate in specific health guidance• Health guidance•

Health and Productivity Management Organizational Framework

Act. In 2023, we began working with this foundation on improving the organizational structure to include full-time public health nurses and a health management center as well as
identifying and addressing health management issues. We
are aiming to routinize improved health management at Kintetsu World Express by 2024 with the following activities.

Labor-management discussion (Article 36
Agreement)• Collect employee opinions via the occupational safety and health committee•

Occupational
Health Physician

Occupational
HealthAdministrator

Employees

Public Health
Nurse

HealthInsurance
Association•

Set notifications for post-exam measures
Recommend health exams to high risk
employees
Mental health self-care andline care awareness

Talks on self-care and line care by managers
Stress check organization diagnosis feedback• Call for high stress interviews••

Work engagement
Health consultation••

Female hormones and life stages
Call to take cancer screening exams••

Interview and guidance from the occupational
health physician and public health nurses

Helping improve health literacy
Labor
Union

•

Women’s health support

Safety and Health Management Center(secretariat)

Occupational Safety and Health Committee

Recommend health exams to high risk
employees•

Identify issues based on employee data heldby Corporate Human Resources

QUOTE
Public Health Nurse

Yasuko Komori

Public Health Nurse

Mami Kawano

We’ve been working here at Kintetsu World Express as full-time health nurses since January
2023. KWE’s business environment has been notably changing due to the impact of the
COVID-19 pandemic, the invasion of Ukraine, and other events, and there are some employees
who are suffering mental and physical illnesses. We want to make use of our expertise as publichealth nurses to help employees to fully excel in their roles by creating a mentally and physically
healthy environment for work. We are members of the Safety and Health Management Center
that was established in April 2023, and we hope to improve employee health through improved
health literacy and to increase corporate value.

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SocialSocial Impacts in the Supply Chain
Progress

Concept & Policy
KWE Vendor Code of Conduct
The KWE Group established the vendor code of conduct in January 2020. The
code sets standards for sustainable, fair, and ethical business practice for all
KWE Group partner vendors around the world.

■ General principles andstandards of conduct
7 principles
1. Compliance with laws
2. Business practices
3. Ethical principles andconflict of interest
4. Safety and health
5. Labor
6. Vendor management
7. Environmental compliancegoing improvement in the social, environmental, and governance dimensions, and applies them at KWE sites
and vendors throughout the entire supply chain.
At the core of this initiative is the KWE Vendor Code of Conduct which has been available to our global vendors since 2021. During 2021 and into 2022, we prioritized a topic our stakeholders were highly interested in:Summary■ Policy

To address the material topic of social impacts in the supply chain, the KWE Group shares best practices for on-safety and health. Specifically, we looked at safety and health in KWE’s warehouse operations. Through this■ In the event of

non-compliance■ Where to report
ethical matters

analysis, we determined seven requirements for our vendors’ work environments. In 2023, we moved forward
on uniform vendor safety and health standards aligned with the KWE Group Occupational Safety and HealthRegulations.
We plan to do vendor assessments in 2024. The entire KWE Group is working to strengthen collaboration
with vendors and creating value together.
As an example, the Japanese logistics industry is currently facing a “2024 problem” that can be summarized
as stricter regulation of truck driver overtime. We are creating mechanisms to reduce business partner vehicle
wait time at airports for air freight, and visiting vendors to see how they are ensuring compliance. For Kintetsu
Logistics Systems trucking business, we are also working on the appropriate disclosure of freight operational

Requirements

costs in direct cost calculation, alongside the receipt of fair and proper compensation.

1 Working environment 2 Machinery and equipment (forklifts, material

The KWE Group is now establishing a human rights policy for our vendors and all of our stakeholders,handling equipment) 3 Emergency action plan 4 Personal protective

which will be announced some time in FY2023. We will continue working on the material topic social impacts

equipment 5 Cargo placement 6 Working conditions 7 Othersin the supply chain as part of our effort to ensure ongoing growth and increasing corporate value.

KWE Vendor Code of Conduct ▼https://www.kwe.com/about/whoweare/policy/vendor-code-ofconduct/

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SocialSocial Contribution Activities
The KWE Group works to fulfill its responsibilities as a good
corporate citizen through social contribution activities, helping meet the needs of local communities in support of environmental protection, public welfare, and culture.
In FY2022 KWE Group companies participated in over 75
social contribution activities. Employees from KWE in Japan,
the Europe, Middle East & Africa Regional Headquarters, KWE
Vietnam, and KWE India got involved.

KWE Japan and the Europe, Middle East &Africa Regional Headquarters
A major earthquake hit the Türkiye-Syria border in February
2023. We offer our deepest condolences to the families ofthe victims and our sympathy to those who suffered in otherways. In response to the subsequent humanitarian crisis, theKWE Group contributed over 9 million yen to rescue and recovery efforts via the International and Japanese Red Cross
Societies. We hope for a speedy recovery from the disaster.

KWE Vietnam

KWE India

KWE Vietnam joined with project sponsor TOTO VIETNAM
to complete the construction of a new school building andplaying field for Primary School Number 2 in Kon Chiêng
Commune, Mang Yang District, Gia Lai Province. Alongside
rapid economic and population growth, certain remote Vietnamese communities lack proper educational facilities andopportunities. KWE Vietnam has been participating in the
project since 2021 with a strong urge to improve this situation and contribute to local community. The new schoolbuilding and playing field at Primary School Number 2 cansupport over 300 children; they can now live to live and study
in a safe environment. KWE Vietnam plans to continue actively contributing to the project.

Almost two years ago KWE India started working with an
NGO dedicated to providing orphans with living facilities
and educational environments, and has so far donated biogas plants to 15 orphanages in the city of Chennai. Biogas is
primarily methane generated from household and other organic wastes, which can be used instead of LPG for cooking
with high thermal efficiency. Using biogas can reduce theuse of fossil fuels. In addition, the residue is a nutrient-rich,safe organic fertilizer that can be used to grow grains, flowers, and agricultural products. KWE India participated in thesame CSR activity in the Gurugram area in June 2023, andintends to continue this activity in the future.

New school building

Donation ceremony in Chennai

Contributions made to
Japanese Red Cross 5 million yen Kintetsu World Express
Society
International Red
Cross Society

30,000 euros (about 4.12 million yen)
Kintetsu World Express, Europe, Middle East &Africa HQ 12 subsidiaries

New classroom

Cooking with biogas

Kintetsu World Express Sustainability Report 2023

31

Governance
The KWE Group is focusing on the material topic of anti-corruption in regards
to governance to continue to earn the trust of our customers, employees,
business partners, vendors, local communities and governments, and otherstakeholders. In April 2023, we appointed a dedicated Head of Group Compliance, and in May we opened our global whistleblower hotline. We continue
to make improvements in compliance.

Kintetsu World Express Sustainability Report 2023

32

GovernanceMaterial Topics
Anti-Corruption
Goal■ Promote communication about anti-

corruption policy and procedures■ Identify risks and confirmed cases ofProgresses in and after FY2022■ Group-wide compliance training for employees in 40 countries

2023 Onward■ Hosting quarterly training sessions (see p 33)

around the world starting April 2022 (see p 33)■ Implemented the KWE Group integrated internal hotline

misconduct in the workplace, andimplement preventative measures

Concept & Policy
KWE Group Compliance Policy
KWE Group governs itself with great accountability andhigh ethical standards. We conduct our corporate activities to the greatest degree of legitimacy to maintain
trust and credibility.
1. All Board Members, Officers, and employees sincerely and sensibly comply with all applicable laws
and regulations, including but not limited to internal regulations.
2. In the course of making business decisions, conducting business transactions, and while managing daily operations, we are mindful of any and allapplicable laws and regulations governing those
activities, and we make compliance with thoselaws and regulations a priority.
3. We take immediate and strict disciplinary action
against any individual reported to be in violationof this policy. Once a potential violation has beenreported, we implement necessary corrective andpreventive measures.

■ Appoint Head of Global Compliance■ Global whistleblower hotline beginning operations

Compliance Framework
The KWE Group compliance framework operates as part ofthe overall risk management framework.
● The Chief Risk Officer has overall responsibility for ensuring
compliance within the KWE Group and for addressing any
instances of non-compliance.
● General managers control the compliance frameworks ofthe subsidiaries under the regional headquarters and are
responsible for ensuring compliance in the regional headquarters and for addressing any instances of non-compliance.
● General managers and the presidents of affiliated companies outside Japan report to the Chief Risk Officer and follow his or her instructions in these cases:
1 When a significant instance of non-compliance related
to company business is discovered or suspected.
2 When a question of compliance cannot be determined
for a matter for approval.
● The president of an affiliated company outside Japan pro-

motes appropriate corporate conduct based on the guidance of the regional general manager, and in accordancewith the KWE Code of Conduct and the KWE Group Compliance Policy.
There are increasingly complex and diverse legal and regulatory requirements in our global business, including widespread extraterritorial application and higher financial penalties, increasing complexity and diversity in complianceawareness in the supply chain, and the globalization of compliance risk. In light of these complexities, we appointed aGroup General Counsel, a qualified attorney, in April 2021
and a Head of Group Compliance in April 2023 to strengthengroup governance overall.
For more information about the KWE Group risk management
framework, see:https://www.kwe.com/about/sustainability/risk/
Kintetsu World Express Sustainability Report 2023

33

GovernanceAnti-Corruption
Close Coordination Between the GeneralCounsel and Corporate Departments
Ensuring Compliance at the Group Level
To adapt to changing business environments, we appointed a new Head of Group Compliance in the corporate division in April 2023. This person is advising on complianceand ethics, establishing group regulations, conducting
training, and investigating reports of non-compliance.

Restructuring the Internal Hotline
In May 2023 we debuted a global whistleblowing hotline
to provide a more appropriate way for employees to reportproblems. All KWE Group employees worldwide can accessthe hotline to report known or potential infringements oflaws or group policies. The hotline enables anonymous
reporting in different languages online or via via phone,email, or fax. Widespread accessibility has made it easier toshare concerns and promotes the early detection and addressing of potential problems.

Compliance Training
Employee knowledge and awareness is critical for ensuring that internal controls function properly and effectively.
That’s why we’ve been conducting group-wide compliance training since April 2022. We will continue working tocreate additional training programs and increase employee
understanding of compliance issues and the internal hotline system throughout the Group.
On the basis of the unified global compliance training
program shown below, KWE Group companies may add

their own program tailored to the company’s specific legal
and regulatory environment to improve the effectivenessof the training. Two examples are KWE Japan’s stratified
training program and APLL’s global anti-corruption interactive webinar program.

No Incidents of Non-compliance
In FY2022, there were no cases of legal action for anti-competitive practices or infringement of antitrust or antimonopoly law.

KWE Group Compliance Training Program (e-learning)
Scheduled
April – June

Antitrust and competition law (basic)

October – December

1. Workplace harassment (for employees)
2. Diversity, equity, and inclusion (formanagers)

January – March

Global anti-bribery and corruption(basic)April – June

Workplace violence and bullying

July – September

Conflicts of interest

October – December

Global workplace harassment (foremployees)

January – March
Global whistleblower hotline web site (image)2024

Ethics and code of conduct

July – September
2022

2023

CourseApril – June
July – September

QUOTE
Ongoing development of ethical and legal
business standards
I’m very pleased to be working as a member of KWE. My goal as Headof Group Compliance is first to identity our compliance risks, including corruption risks, and then provide our employees and business
partners with the knowledge and tools needed to control and resolve them.
KWE will be building a responsible compliance program that
adapts to changes in global business activity and laws, and will maintain a good reputation for its conduct based on compliance and ethics.

Antitrust and competition law(advanced)
Global anti-bribery and corruption(advanced)

Head of Group Compliance

Stephen Walton

Financial integrity
Kintetsu World Express Sustainability Report 2023

34

GovernanceCorporate Governance
The KWE Group’s corporate philosophy is to “Contribute to the development of a global community through logistics services—by creating new value, sustaining the environment andcollaborating with our clients, shareholders and employees.” The primary management goalof the KWE Group is to improve corporate value while maintaining good relationships withall stakeholders. To achieve this goal, it is important to strengthen corporate governance andenhance the transparency and fairness of decision-making processes.
Corporate Governance Framework

General Meeting of Shareholders
Nomination and Dismissal

Nomination and Dismissal

Audit &
Supervisory Board

Independent
Auditors

Supervise

Corporate Management Meeting

Internal Control
Audit

Representative Director
Directors

Reporting

Audit Department

Number of Directors

Number of Audit & Supervisory
Board Members

63of which 2 areoutside directors*Established a new Audit & Supervisory
Board

For more information about corporate governance, see:https://www.kwe.com/about/sustainability/governance/

Board of Directors

Operational Audit
Accounting Audit

Coordination

Nomination and Dismissal

Governance Summary (as of June 12, 2023)

Corporate Departments
Internal Auditing

KWE Group Risk
Management Committee Risk/Compliance Management
Internal Control
Operation Committee

Internal Control Management

KWE Group
Sustainability
Committee

Instruction and Supervision

Regional Headquarters
Domestic/
Overseas Group Companies

Risk Management
The KWE Group Risk Management Basic Policy provides the foundation for unified, ongoingrisk management on a global basis.
A board director is appointed as the chief risk officer as provided for by the KWE Group
Risk Management Regulations.
These Regulations clearly state the responsibilities of each position involved in risk management. The KWE Group Risk Management Committee reviews risks that should be addressed at the Group level and ensures they are handled appropriately.
In addition, the KWE Group Business Continuity Basic Policy and specific business continuity plans are in place in the event of emergencies posing a critical threat to our business.
The KWE Group Risk Management Committee met four times in FY2022, sharing information on major risks to the Group overall and working on avoiding or reducing those risks.
Regional Risk Management Committees met twice at regional headquarters outside Japanand four times at Japan headquarters, identifying and addressing risks in their region.
For more information about the KWE Group risk management framework, see:https://www.kwe.com/about/sustainability/risk/
Kintetsu World Express Sustainability Report 2023

35

Information
ESG Data
Corporate Data

Kintetsu World Express Sustainability Report 2023

36

Information

ESG Data (FY2022)
Environment*1
Item

Kintetsu World Express(non-consolidated)Year on Year

Electricity (kwh)Type

EnergyWater

15,405,578

95.1%

Category 1 (purchased goods and services)

12,112

6,251

96.5%

Category 3 (energy related)

1,696City gas (m³)

5,874

97.7%

Category 4 (upstream transportation and distribution)

195

CO₂e (t)15111.8%

Category 5 (waste)

459

Usage (t)17,191

96.9%

Category 6 (employee business travel)

662

Gasoline (l)39,711

88.1%

Category 7 (employee commuting)

640

92

88.0%

30,816104.8%

80

105.5%

26,471

34.5%

158

68.6%

Fuel oil A (l)

0

0.0%

CO₂e (t)00.0%20,60596.5%

Diesel fuel (l)CO₂e (t)Propane gas (kg)CO₂e (t)Office paper (box)
Waste

Resource waste

2,500 pc/box
Flammable (kg)132,225

Non-flammable (kg)

13,345

81.7%

Plastics (kg)

114,750101.5%

Cardboard (kg)793,916

99.6%

Paper (kg)212,373

99.4%

Wrap (kg)

63,931117.6%

Wooden pallets (kg)356,438

Iron scraps (kg)2,080

CO₂e total (t)

95.6%

64.1%
-

CO₂e (t)Scope 3 emissions (t)SocialItem

KWE Group Total (Worldwide)

Employees (persons)

18,552

Countries

45

Diversity and inclusion e-learning participation (%)

95.57

Women in management positions (%)

34.3

Governance
Item

As of June 12 2023

Board Directors (persons)

6

Auditor and Supervisory Board Members (persons)

3

6,596

95.0%

Outside Directors (persons)2

Of which Scope 1

345

74.6%

Managing Officers (persons)18

Scope 2

6,251

96.5%

*1 Resources used in FY2022 by Kintetsu World Express offices and warehouses.
*2 CO₂e calculated from electricity consumed using rates provided by the electric power companies. Calculated excluding renewable energy purchased through Green Power Certificate.

Type

Kintetsu World Express(non-consolidated)

Category

CO₂e (t)*2CO₂e (t)

Fuel

Item

Item

KWE Group Total

Of which Scope 1

50,649

Scope 2

46,723

Directors who are also Managing Officers (persons)2

Outside Director ratio (%)*3

33.3

Women Director ratio (%)*4

16.7

Board of Directors meetings in FY2022 (times)

12*3 Number of outside directors divided by total number of directors*4 Number of women directors divided by total number of directors

Kintetsu World Express Sustainability Report 2023

Information

37

Corporate Data (As of March 31 2023)
Business Overview
Air freight forwarding

Global Network
Sea freight forwarding

Logistics

Other

Europe,Middle East & Africa
Consolidated subsidiaries

14

Equity method affiliates

1
Other 0.1%

Other 4.5%
Japan

APLL

Net salesby segment

Southeast
Asia & Oceania

19.8%

18

(Billion yen)(Billion yen)

1,000

2

50

400

25

200

0

0

Consolidated
subsidiaries

63

Equity method
affiliates

2

1

ISO 9001 Quality management system(Billion yen)

600

Other

Consolidated
subsidiaries

Certifications

Total assets

75

APLL

ISO 14001 Environmental management system
ISO 13485 Quality management system for medical devices

750

ISO 45001 Occupational safety and health management system

500
250

Transported Asset Protection Association (TAPA) Certification
Good Distribution Practice (GDP) Certification

0(FY)

Equity method affiliates

2

Consolidated Financial Highlights (FY2018 - 2022)
Operating income

18

Equity method affiliates

31.4%

Net sales

7

East Asia

Consolidated subsidiaries

Sea freight
forwarding

7.0%

Consolidated subsidiaries

2

Southeast Asia
& Oceania

11.7%

East Asia

The Americas

Equity method affiliates

Consolidated subsidiaries

Net salesby business

Europe,Middle East & Africa

4

42.7%

21.4%

The Americas

14.5%

Consolidated subsidiaries

Air freight
forwarding

Logistics

23.4%

23.5%

Japan

2018

2019

2020

2021

2022

(FY)

2018

2019

2020

2021

2022

(FY)

2018

2019

2020

2021

2022

Authorized Economic Operator (AEO) Certification

Kintetsu World Express Sustainability Report 2023

Kintetsu World Express, Inc.
Corporate Planning & Administration
24th Floor Shinagawa Intercity Tower A, 2-15-1 Konan, Minato-ku, Tokyo 108-6024 Japan+81-3-6863-6441 (Inquiries about this report)
https://www.kwe.com