︱

Foundation of Sustainability Management ︱Governance

ESG

Environment

SocialGovernanceCompliance▍Whistleblowing System

Basic Philosophy

Full-time auditor

Sanki Engineering Group Compliance Declaration, SankiEngineering Group Conduct Standards

https://www.sanki.co.jp/en/csr/policy/compliance.html#etc02

Sanki Engineering Group Code of Conduct and Action
Guidelines

https://www.sanki.co.jp/en/csr/policy/conduct-code.html

ReportOfficers responsible for corporate ethics
ReportReportIn-house hotline (Sustainability Promotion Division)

External hotline(consultingattorney)

Compliance Promotion System
We have established a Corporate Ethics Committee, chaired by the president, whonominates officers responsible for corporate ethics to oversee the committee’sactivities. The committee reviews, monitors, and provides guidance with respect
to compliance guidelines and action plans for the entire Group, and the Board ofDirectors regularly verifies the effectiveness of its activities.

Corporate Ethics Hotline
Fair Trade Hotline

If the person wants to report

Women’sHotline

Report and Consultation

P. 74
Corporate Governance System

Compliance Promotion Activities
In order for all Group executives and employees to refresh their awareness of theresponsibilities they must fulfill in their respective positions and roles, complianceconfirmation sheets covering items such as observance of the Code of Conductand Action Guidelines, and eliminating antisocial forces, are submitted at thebeginning of each fiscal year.

⨋ Whistleblowing System▍Number of People Submitting Compliance Confirmation Sheets (Fiscal 2023)

Number of Reports
Corporate Ethics Hotline

10Fair Trade Hotline

0

Women’s Hotline

0Consulting Office for Harassment and Other Concerns

1Consultations

10SANKI REPORT 2023

Sanki Engineering(Target Employees)
Compliance confirmation sheets concerning
performance of duties*1Compliance confirmation sheets*2E-mailhotline@eng.sanki.co.jp

Reporting and Consulting
Channels

https://www.sanki.co.jp/en/csr/
governance/hotline/

38

Group Companies(Target Employees)（38）

っs37 （37）2,027（2,063）

498（509）*1 D irectors and executive officers
submit compliance confirmation
sheets related to the execution ofoperations.
*2 I ndividuals who did not submit
compliance confirmation sheets
were unable to do so due to reasons
such as maternity leave and medicaltreatment.

Compliance

The Internal Audit Office seeks to strengthen compliance by providing guidanceon audits. In fiscal 2022, internal audits were carried out at 20 worksites, including
16 in Japan and 4 subsidiaries in Japan and overseas. In addition, we conductedhearings with onsite staff by visiting Company sites and via web conferencing tofoster compliance awareness.

Governance⨋ Compliance Confirmation Sheets from All Executives and Employees▍Number of Reports and Consultations in Fiscal 2022

Poster promoting the whistleblowing
systemConsulting Office for Harassment andOther Concerns (professional counselor
outside the Company)⨋ Compliance Audit

We set up the Corporate Ethics Hotline for reporting on compliance-related issues,
the Fair Trade Hotline for reporting on violations of the Anti-Monopoly Act, theWomen’s Hotline for accepting consultations from women, and the Consulting Officefor Harassment and Other Concerns. All hotlines are open to all employees, andinformation is posted on the corporate website.
With regard to each hotline, we act swiftly to resolve the issues that are reported,with due consideration for the protection of anyone seeking consultation or providing
information in accordance with the Corporate Ethics Regulations. All reported
information is presented to corporate ethics officers , and important information isreported to the Board of Directors. At the Corporate Ethics Hotline, the reporter’s nameis handled in secrecy by corporate ethics officers and will not be disclosed to others
without the reporter’s prior consent. The reporter will not be placed at a disadvantage
for consulting or reporting to the hotline.
In fiscal 2022, there were 11 reported incidents (10 internally and 1 externally), andall incidents were handled appropriately.

84

ReportBoard of Directors

Foundation of Sustainability Management

The Sanki Engineering Group strives to maintain legally compliant behavior based on corporate ethics across all aspectsof its operations by upholding the Sanki Engineering Group Compliance Declaration, the Sanki Engineering Group Codeof Conduct and Action Guidelines, and the Sanki Engineering Group Conduct Standards.

⨋ Response to Antisocial Forces

We clearly state that severing relationships with antisocial forces is a condition
for doing business with our partners and ask them to submit a Letter of Intent
Regarding the Elimination of Antisocial Forces. As of March 31, 2023, we havereceived the letter from a cumulative total of 3,906 companies.
⨋ Training and Handbook for Ensuring Thorough Compliance

Sanki Engineering conducts training for all executives and employees on a regularbasis in order to ensure thorough dissemination of and compliance with the Code ofConduct and Action Guidelines. Separate special training is provided for mid-careerhires when they join the Company and for new sales representatives when they start
their position.
We also distribute the Sanki Engineering Group Sustainability Handbook, a pocketsized reference on policies related to compliance and sustainability, including specificexplanations for practical situations and information on hotlines for reporting andconsultation.

Sustainability Handbook

SANKI REPORT 2023

85

︱Foundation of Sustainability Management ︱Governance︱Compliance▍Compliance-Related Training (FY2022)
ThemeTarget

Frequency and Participation(Attendance Rate)
10 sessions
2,632 employees (99%)*

Compliance topics including the Codeof Conduct and Action Guidelines,
Anti-Monopoly Act, human rights, andpreventing bribery

All Group executive
officers and employees
Mid-career hires

5 employees (100%)

Compliance with the Anti-Monopoly Act

Newly assigned sales staff

38 employees (100%)

Human Rights Policy, Environmental Policy

All Group executive
officers and employees2,628 employees (99%)*⨋ Survey on Status of Compliance in the Workplace

We conduct a survey every fiscal year on the status of compliance in theworkplace, targeting all executive officers and employees. It incorporates
questions on compliance and human rights risks, including about issues related toharassment in the workplace, by customers and business partners. Survey results
are disclosed to all Group executives and employees.

Initiatives for Preventing Bribery
We are working to prevent corrupt practices under the Sanki Engineering Group
Action Guidelines, which prohibits bribing public officials and providing benefits
such as excessive business entertainment. In addition to establishing a program
specifically related to bribery as part of our corporate ethics training, we provide
e-learning for all employees. Points to consider when making practical businessdecisions and points to keep in mind outside Japan are also explained in the SankiEngineering Group Sustainability Handbook.

Reinforcing Compliance with the Anti-Monopoly Act⨋ Ongoing Measures for Recurrence Prevention

The following are key measures on reinforcing compliance that we undertook to date.
In October 2022, we revised the Anti-Monopoly Act Compliance Manual. Applying theresults of the survey on compliance in the workplace, we will continue our Group-wide
effort to prevent violations of the Anti-Monopoly Act in fiscal 2023.

*Individuals who did not participate intraining were unable to do so due toreasons such as maternity leave andmedical treatment.

FY2023 Survey on Compliancein the Workplace
Survey period: May and June 2023
Participants: all Group executive
officers and employees
Q Do you think that complianceconscious behavior has
permeated our Group?
• Yes.
• Somewhat.
• I’m leaning toward “no” here.
• No.

Q Please choose all of the following
statements that apply to yourcurrent working environment.
(Multiple answers are allowed.)• I think that personal
relationships in the69%
workplace are relatively
good.
• It seems easy to take various
kinds of leave.

60%• Y our supervisor is willing tolisten to your opinions andsuggestions.

47%

Q What do you think is importantfor creating a workplace thatis less prone to complianceviolations? (Multiple answers
are allowed.)• I mproving personal morals75%and awareness• I mproving communicationin the workplace51%• E liminating work overload
and understaffing

48%

Policies and Manuals• Formulated the Sanki Engineering Group Compliance Declaration and Sanki Engineering Group Conduct Standards• Issued and revised the Compliance Handbook• Issued the Sustainability Handbook• Issued and revised the Anti-Monopoly Act Compliance Manual• C learly stipulated breaches of laws such as the Anti-Monopoly Act as grounds for disciplinary action

Structural Reinforcements• R esolved to establish a comprehensive, Group-wide Anti-Monopoly Act Compliance Program at a meeting of the Board of Directors and ran/implemented the program• Assigned a compliance manager in each division and began supervising the process for deciding the bid amount for public works and operating a system of advanceapplication and reporting when attending a meeting with any companies in the same industry• I ntroduced regular rotations for sales staff assignments• Established a Compliance Risk Subcommittee within the Risk Management Committee• R econsidered membership in outside groups• B egan an in-house leniency system (voluntary reporting system)• Established the Fair Trade Hotline for reporting on violations of the Anti-Monopoly Act and sought awareness among employees

Training and Education• S ubmitted compliance commitment letters• R aised awareness of compliance-related hotlines• Top management visited all business bases to hold corporate ethics training sessions through direct exchange with all Group executives and employees• Held special training on the Anti-Monopoly Act for newly assigned sales staff and mid-career hires• Conducted e-learning on the Anti-Monopoly Act for all employees

86SANKI REPORT 2023

37%
58%
4%
1%