C S R
Report2 0 1 8Digest Edition

Aiming to live together in harmony withthe people, society and the EarthCSR of SAWAFUJI

President’s
Message

Since our beginning in 1934, SAWAFUJI ELECTRIC CO., LTD. has been devoted to our craftsmanship andin meeting the expectations of our world-wide customers in providing good products and service. True toour corporate philosophy, we foster communication among our stakeholders across the globe as we work toremain the kind of company that the public can trust.
Despite signs of economic recovery both in Japan and abroad, there are uncertainties such as individual
country policies, the UK’s withdrawal from EU, and the situation in North Korea. Against this backdrop, weare making group-wide efforts to bolster our financial standing and competitive edge in order to lay a strong
foundation upon which we will be able to build for generations to come.
We would appreciate your frank opinions on this report about Sawafuji’s efforts for CSR.
Sawafuji Electric Co., Ltd. President & Executive Officer President Akihiko Yoshikawa

Company Policy

Management Creed

1. Let’s proceed with research, practice skills andmake rapid progress brightly.
2. Let’s keep responsibility toward and faith withcustomers and contribute to the society.
3. Let’s establish bright workplace based on labormanagement cooperation and mutual trust.

SAWAFUJI ELECTRIC CO., LTD. produces good
products, performs social responsibility as a corporationand provides prosperity to all people concerned.
* Make an impression on customers.
* Bring purity to nature.
* Bring prosperity to people engaged in the company work.

(Established in July 1960)

BasicPhilosophy

Long Term Management Policy

SAWAFUJI
VISIONCSR Efforts

In order to achieve a figure which
aim of the three businesses,
Sawafuji multilaterally captures
the customer’s needs and trends,
then challenge to complete theachieving. Because of this, we are
driven to strengthen our businessactivity by “providing customervalue,” “having innovative changes”
and by “combining your and ourindividual and diverse strengths.”(Established in October 1990

Revised in April 2001)

Make shine ourself to be attractive Sawafuji for all stakeholders
Our inspired imagefor business[A business for generators]
Lead to the technology
oriented business, makes
a world No. 1 of power
generation equipment,such as could convert
all the energy
into electricity.

[A business forProviding customer value
electrical components]
Working closely with our customers,
A business
we consider the needs of society
contributing to aand work to develop new values
safe and secureenvironment
through the eyes of our customers.
maintained by theproduct development Innovative changes
adapted to thevehicle electrification. By adding innovative changes on ourmanagement system, we enforce
our business competitiveness.

[A business for refrigerators]
A business providing portablerefrigerator/freezer, which could
be used in any place, functioning
not only as refrigerator/freezer
but also as warmer.

Under its basic philosophy, Sawafuji will endeavor
to continuously raise corporate value by fulfilling
corporate social responsibility in cooperation withmany stakeholders.
We believe our relationship with our suppliers isimportant, and therefore ask for their understanding
and cooperation in fulfilling their own corporate socialresponsibilities.

Combining individual and diverse
strengths

Supporting individual growth, we areworking hard to have a well-organized
operation that is both slimmed down andhas good “footwork.”

Customers
Shareholders andInvestors

Suppliers

Localcommunities

CSR

1) Creation of useful products and services2) Coexistence with the global environment3) Contribution to society;
Distributors
ensuring confidence in the Companyand Dealers
4) Realization of an excellent working
environment

Publicinstitutions

Employees

Dialogue with
Stakeholders

Sawafuji conducts lectures at autumn seminar with affiliates, periodical information exchange meetings withthe local residents, friendship meetings with people in nearby welfare facilities and promotes other CSR
management efforts with the focus on talks with the stakeholders.

Earnings
Results forFY 2017

Sawafuji Group strived to improveearnings in all our operations,improve business efficiency andproductivity, and reduce costs.
Consolidated earnings results for FY
2017 (122th term) were as follows.
- Amount of sales: 30,868 million yen- Ordinary income: 551 million yen

History of sales turnover

Changes in the ordinary profit(million yen)(million yen)

50,00040,00030,0001,50028,280 29,746 29,117 27,361 30,868

20,000500

10,00001,000

2013

2014

2015

2016

2017 (FY)

0328
2013

654

432409

2014

2015

2016

551

2017 (FY)

Sawafuji strives to provide products and services that meet customers’ needs, with the highest priority given
to customer expectations and trust.

Development of products

Relations
withCustomers

To be highly evaluated by customers around the world, the Development Division tackles development issues,
striving to establish its position as No. 1 of the industry in the fields of electric equipment for trucks and buses,
engine generators and vehicle-mounted refrigerators, and contribute to the development of these fields.

Monozukuri

Sawafuji strives every day to achieve craftsmanship capable of moving our customers emotionally.

Quality control system and Service network

Sawafuji continues to improve ourselves by creating a quality control system that conforms to the ISO 9001
management system. We have also created a service network enabling a prompt response to difficulties.

Relations
with Globaland Local
Communities

Relations with
Shareholdersand Investors

Sawafuji contributes to the community and internationalsociety by conducting itself as an engaged member ofthe community with due consideration for environmentalconcerns.
Major efforts made during FY 2017 are as follows.
More information can be found on the last page of thisreport.

- Working with the Japanese Red Cross Society
in their blood donation drives- Get-togethers with people in welfare facilities.
- Volunteer for cleanup activities and traffic
safety near our factory- Offering vaccines to the children of the world- Participating in local events

To ensure fairness and transparency, Sawafuji discloses appropriate information in a timely manner toshareholders and other stakeholders.

IR information

Sawafuji believes that it is important manner for the shareholders and investors to better understand Sawafuji.
As a part of our investor relations (IR) activities, we issue a biannual Shareholders Newsletter in addition tomaterials released at the time of business results announcements.
The newsletter, which contains topics on our environmental activities and new products, is intended to help
shareholders and investors broadly understand our activities.

Relations withDistributors
and Dealers

Sawafuji which has established systems to sell commercial parts and components, collect market informationand provide services by using the networks of its distributors and dealers to fulfill its social responsibilities inevery business situation.
In FY 2017, the Company held meetings at its 10 bases nationwide, explaining our policies and strengthening
communication with our distributors.
We also held technical lectures to enhance services at these distributors and dealers.

Relations
withSuppliers

Sawafuji pursue fairness in the transaction process and procure optimal articles. To this end, we establish
trusting relationships with our suppliers under the basic philosophy of “mutual trust and prosperity,” and aim for
mutual development and growth.
We are actively communicating with our suppliers by holding procurement policy briefings, general meetings ofcooperating associations of Sawafuji, and joint training sessions on a regular basis, and information exchange
meetings on a monthly basis.
We also actively cooperate with our suppliers in areas such as quality improvement and cost reduction.
Sawafuji values the self-reliance and creativity of each of its employees.
We have established the following systems and measures to ensure the safety of the workplace, health ofemployees and to provide a rich workspace environment.

Employment

We are committed to personnel training based on our policy of employment stability.

RelationswithEmployees

Human rights

We maintain a corporate environment conducive to eliciting the desire to work through our response forhuman rights and a fair personnel system.

Diversity of employment efforts

To support employees’ diverse working style, we have developed, re-employing retired people, employing
disabled people, offering child-care leave and volunteer leave system.

Safety and sanitation management and health care

Under the concept that “Safety takes precedence over all business”, we are developing safety activities withthe aim of “An environment where people can work with peace of mind”.
We value each of our employees and make every effort to ensure that they stay healthy.

Environmental
ReportIn 1997, Sawafuji obtained the ISO
14001 Environmental Management
System certificate. Since then, it
has done its utmost to achieveenvironmental activity goals, which
are set every FY, in line with theEnvironmental Policy.
Major efforts include reducing CO2
in production activities, managing
and reducing substances thatdamage the environment, and we
also are providing miniaturized andlightweight products that are energy
efficient, have low emission and thatconserve on resources and water.
We have compiled the resultsof our environmental work in
an environmental report, whichis included in the CSR Reportpublished on our corporate website.
* Please refer to the web version that wehave introduced on the last page.

Environmental Policy
Sawafuji Electric is committed to playing a vital role in building
a society designed to pass on a healthy environment to future
generations, so we work to provide products and services that meetcustomer expectations through safe manufacturing practices and todevelop next-generation technologies for a new society driven byenvironmentally sound energy.
1. We develop and design technologies that will not only enhance
performance but also reduce the environmental burden.
2. We are committed to protecting the environment by assessing the impactof our production activities, products, and services on the surrounding
environment, resources, climate change, and the ecosystem as we workwith an eye to preventing pollution and making continuous improvements.
3. We comply with envrionment-related laws and regulations as well asprescribed requirements while ensuring that each employee fulfills his or
her social responsibility.
4. We actively foster communication among local communities as a good
corporate citizen.
Established in May 1997

Revised in January 2017

Sawafuji Electric Co., Ltd. President Akihiko Yoshikawa

We contribute to local industries and communities, and provide products that satisfy the world.
Special Feature: “SAWAFUJI WAY” Proclamation
The principles of behavior and shared values that Sawafuji
Electric employees can incorporate in their work were decided
on and announced on March 20, 2018. They were decided
on based on the idea that employees themselves are awareof the SAWAFUJI WAY and will behave in a way that makes
them happy, makes customers happy, contributes to society,and leads to company growth.

CompanyCompany Policy

Policy foundation

Management Creed

Essential goals

Company Principles

Specific action guidelines

Code of Ethics

Code of conduct

SAWAFUJI WAYValues

Individual(Behavior Principles)

Contribution to Local Industries and Communities
We were awarded the Industrial Development Contributing
Company Award by the neighboring cities of Ota and Isesaki,
Gunma Prefecture.

Ota City’s certificate recognizing
Sawafuji as a company contributing
to industrial development

Isesaki City’s certificate recognizing
Sawafuji as a company contributing
to industrial development

Sawafuji works hard to deepen ties with the local community.
Our efforts include get-togethers with people in welfare
facilities, cleaning the area near our factory, volunteer activity
and the participation in local events.

Cleanup activity near our factory

Participated in Ota local teachers’ fair

Provision of Products That Satisfy the World
Sawafuji’s products are helpful to people around the world.

Generator

Refrigerator

ELEMAX generators actively being used inVietnam

ENGEL refrigerators actively being used for
emergency-related illnesses for things suchas heatstroke

ELEMAX generator

ENGEL refrigerator

Automotive electrical equipment

StarterAlternator

Computer for onboard use   W E B S I T ESH3900

MD14F

http://www.sawafuji.co.jp/kankyo/kankyo_index.php

On our company’s web site above, we have introduced in detail the contentsof our Social Compliance Report and our Environmental Report.
Thank you for reading them over along with this digest version.

SearchInquiries:

3 Nittahayakawa-cho, Ota-shi, Gunma 370-0344, Japan

Internal Control Department
Environment Safety Department

TEL. +81-276−56−7338
TEL. +81-276−56−7334

FAX. +81-276−56−6413
FAX. +81-276−58−2154