CSR Report

2009
A iming t o li ve t o ge ther in har mon yw ith the p e ople, s o cie t y and the Ear thContents
Greetings from the President............................................... 2
Basic Philosophy.................................................................. 3
CSR Efforts........................................................................... 4

Management

Social Reports
Together with Customers................................................10
Together with Local Communities...................................11
Together with Shareholders and Investors......................13

Corporate Governance.................................................... 5

Together with distributors and dealers............................13

Compliance...................................................................... 6

Together with Suppliers...................................................14

Risk Management............................................................ 6

Together with Employees................................................15

Information Security......................................................... 6

Economic Reports

Environmental Reports
Environmental Policy......................................................17

Overview of Sawafuji Electric Group................................ 7

Environmental Management...........................................17

Earnings Reports.............................................................. 7

Considering the Environment in Product Development . ..20

Production and Sales Bases............................................. 8

Considering the Environment in Production....................21

Main Products................................................................... 9

Considering the Environment in Logistics.......................23
Considering the Environment in Communication............23
Environmental Data........................................................24
History of Environmental Efforts and Activities................25
Issuance .............................................................................2675th Anniversary ofCompany Establishment

Full-of-Flowers activity
Around the plant, lots of flowers are blooming in flower
beds and planters, providing healing space pleasant for
the environment, customers and employees.

Greetings from the President
The Sawafuji Electric Group will contribute to the realization of asustainable society through monozukuri (Japanese-style manufacturing)based on the spirit of the foundation.
Founded in 1934, Sawafuji Electric Co., Ltd. is celebratingits 75th anniversary this year. In its early days, the Company
developed and produced Japan’s first high-voltage magnet
generator for aircraft.
Currently, the Company operates electrical equipment,
generator and refrigerator businesses and our products arebeing enjoyed by customers in more than 100 countries,
including Japan. With its production and overseas sales
bases, the Company has grown into a global corporation.
In these rapidly changing times, the Company was able togain the support of its customers and other stakeholders
because they understand that we have faithfully engaged
in our business activities and in the development of local
communities under our management philosophy of “making an
impression on customers, keeping nature clean and helping
persons involved in the Company’s business prosper.” I would
like to express my heartfelt gratitude for their understanding
and support.
Under the global management environment, the Company
aims to be an earth-friendly company that is trusted by society
and customers and the future generations as well. In line with
this, the Company made clear what it wants to be in the futureand set targets and formulated an action plan under “Sawafuji
Vision 2015” to realize these goals.
To achieve these targets, the Company is implementing
activities under the name of “Sun Sun Action,” under which
the Company hopes all employee will engage in valuable
and satisfying work, in which individuals, workplaces and theCompany will continue to shine with great brilliance.
Sawafuji Electric henceforth will pursue the creation of asustainable society through monozukuri, aiming to preserve
the global environment and contribute to the revitalization of
the economy.
The CSR Report 2009 introduces a variety of such efforts by
Sawafuji Electric. However, these efforts are still insufficientand need to be improved. We recognize the seriousness of
this matter and as such will further step up to achieve ourgoals.
I sincerely appreciate your frank opinions and views regarding
this report.

October 2009
Kiyoshi Takada
President and Representative Director,
Sawafuji Electric Co., Ltd.

2

Basic Philosophy
The Sawafuji Electric Group’s Motto, which shows its corporate stance and its Management Philosophy, which
expresses its corporate mission, as the bases for corporate activity.
To implement this management philosophy, we have established the Sawafuji Sun Sun Action and it’s Code of
Conduct. We have also set forth the Sawafuji Vision 2015 in the medium-term business plan, which we are now
working on.

Business Principles (established in July 1960)
1. Let’s push ahead with research, improve technologies and leap forward brilliantly.
2. Let’s fulfill our duty to customers and keep our faith with them and contribute tosociety.
3. Let’s establish an even more comfortable workplace through the cooperation andmutual trust between employees and management.

Management Philosophy (established in November 1990 revised in April 2001)
Sawafuji Electric will manufacture quality products, fulfill its corporate social
responsibilities and provide prosperity to all parties concerned.
* Making an impression on customers* Keeping nature environment clean* Provide prosperity to those involved in the Company’s business

Sun Sun (3 X 3) Action and Code of Conduct
Sawafuji Sun Sun (3 X 3) Action

Code of Conduct(ADSL)

Three parties (executive officers, managers, employees)
under a unified effort
For three parties(individuals, workplace, the Company)

1. Active

Implement three activities

2. Dynamic

Three pillars for activities:
1. FI activities (“Find” and “Identify” issues (or treasures))
2. KMKM activities (Decide, follow, record and monitor)
3. KRe activities (Review, renew and refresh)

3. Speedy
4. Leadership

Sawafuji Vision 2015
To achieve this vision, everyone, from management to staff, will strive to realize acompany that shines brilliantly.
Basic concept regarding the V-shape recovery of Sawafuji Electric: “New-3D Plan”

Lean and strong
corporate structure

Corporate social
responsibility (CSR)

New
creations
New businesses

Production reform

Development reform

Quality reform

Cost reform

Procurement reform

Marketing reform

Logistics reform

Operational reform

Personnel training

IT reform

Other

Advance forth
to the world

New products

New technologies

3

New markets

New customers

New alliances

Overseas production

CSR Efforts
We will fulfill our social responsibility as a company and help all parties concerned prosper.

Sawafuji Electric’s management philosophy is to “manufacture quality products, fulfill its social
responsibility as a company and help all parties concerned prosper.”This management philosophy is in accordance with the spirit of corporate social responsibility (CSR)
that is prevalent among companies. We regard it as our mission to help realize an affluent andcomfortable society and grow as a genuine global corporation that meets the expectations of ourcustomers around the world.
In order to fulfill our corporate responsibilities, we inevitably need alliances with and the cooperationof many stakeholders. We will continue to consider growing together with those of different positions
who support our corporate activities and devote ourselves to improving our technologies so that wewill continue to be a company that can fulfill our responsibilities to society.
Sawafuji Electric will continuously raise corporate values through faithful and responsible activities forvarious stakeholders and the fulfillment of our corporate social responsibility.

CSR Management (together with stakeholders)
CSR: Corporate Social Responsibility
Shareholders
and investors

Suppliers

Public institutions
Distributors
Dealers

CSR
1) Creation of useful products and services2) Coexistence with the global environment3) Contribution to society; ensuring confidence in
the Company

Customers4) Realization of an excellent working
environment

Employees

Global environment

4

Local communities

Management
Corporate Governance
Establishment of corporate governance that respects the positions of Sawafuji Electric’s stakeholders
Basic policy

Auditors and Board of Auditors

Sawafuji Electric believes that corporate value is increased
through improvement in management transparency andcompliance with laws and regulations. We are enhancing
corporate governance and establishing an organizational
system that can quickly respond to the changes in the
management environment.

Sawafuji Electric is a company with an auditor system underwhich four Auditors are tasked to audit the Directors’ executionof duties; the Board of Auditors is held in accordance with theannual plan. The board conducts audits of the entire Group,
including on-site audits of subsidiaries. In addition, the board
and certified public accountants meet and explain the outlineof each accountant’s auditing plans. They also meet during
quarterly reviews and year-end audits, attend each other’s
actual audits and inventory audits and exchange information
on audits conducted during the period as necessary. Thus,
the Board of Auditors and certified public accountants
work together to establish a transparent and fair corporate
management system.

Directors and Board of Directors
Sawafuji Electric has clarified the roles and responsibilities
in managerial decision-making and business executionfunctions, and focused on the establishment of a systemthat can promptly and appropriately respond to the swiftchanges of the management environment. In line with this,Directors’ terms of office are set at one year to emphasize
management’s responsibility.
The Board of Directors meets once a month to deliberate andresolve significant management-related matters, including
basic policies, items stipulated in related laws and regulations
and matters concerning subsidiaries.

Measures for establishing a system to ensure
the efficient execution of Directors’ duties
Sawafuji Electric has established a system to ensure that
Directors execute their duties efficiently and holds businessmeetings, profit improvement meetings, product planningmeetings and other types of meetings aimed at crosssectionally discussing and deciding expert matters.

Management meeting
Management meetings are held once a week and Directors
reports and discuss each other’s execution of duties, makeflexible managerial decisions and oversee/audit each other’s
execution of duties.

Improvement of the internal control system
At its Board of Directors meeting held in May 2006, Sawafuji
Electric announced the “Basic Policy on the Improvement of
the Internal Control System,” by establishing an Internal Control
Committee and an Internal Control Department.
In FY 2008 (the 113th term), the Company improved its
internal control system over financial reporting, evaluatedthe implementation of internal control and prepared internal
control reports in accordance with the Financial Instruments
and Exchange Law.

- Corporate governance system- “Corporate Governance Report”

Outside theCompany
Appointment

Notifying

Corporate Attorney

ReportingCorporate Ethics Help Line

AffiliatedCompanies

Each year, Sawafuji Electric submits a Corporate
Governance Report that submits its corporate
governance system to the Tokyo Stock Exchange.

General Shareholders Meeting
Appointment

ReportingBoard ofAuditors

Reporting
Auditing and Overseeing

Appointment
Auditing and Overseeing

Board of Directors

Reporting

Auditing and Overseeing

Auditing, Overseeing
and Reporting

Instructions

Auditing
Instructions

Internal Control Department
Auditing and Overseeing

In-house meetings
Sections and Subsidiaries

5

ReportingAccounting
Auditors

Management Meeting

Cooperation
Auditing

ReportingCompliance

Risk Management

Basic policy and ethics principles

Basic policy

Sawafuji Electric enacted the Corporate Ethics Principles in
April 2002 to ensure that it observes laws, regulations andother social standards as well as implement fair and soundcorporate activities. In April 2008, the Company issued aCompliance Guide Book with the goal of thoroughly carryingout the compliance.

Sawafuji Electric takes up material risks from the entire
company and adopt measures for decreasing them, theInternal Control Committee deliberates such risks andmeasures and take the appropriate steps to reduce the lossof personnel, physically and other management resources
through the cause of their daily business activities, natural
disasters and other accidents.
The Company has established a system for managing
emergencies, which enables its staff to quickly take theappropriate measures and restore the pre-emergency status,
this communication network has been made known to all
employees.

Corporate activities in accordance with social standards,
such as laws and regulations and social common sense

Employees safety and conservation of management
resources

Establishment of the Corporate Ethics Help Line
Sawafuji Electric has established the Corporate Ethics Help
Line, a system which enables persons involved to notify
and consult with the staffs regarding any act that violates
or is suspected of violating relevant laws, regulations or
the Corporate Ethics Principles. Through this system, theCompany is monitoring unlawful and antisocial acts by its
employees and striving to prevent such acts.
The Company will do its utmost to protect related informationof individuals information and preventing them from being
taken advantage of.

Promotion system
Sawafuji Electric is managing and implementing measures
for minimizing risks associated with its overall businessactivities through the Internal Control Committee under theleadership of the president.

Education and human resource training

Information Security

Sawafuji Electric provides compliance education for its
employees yearly aiming at the thorough implementation ofcompliance and employees training.
During FY 2008, the Company conducted complianceeducation for all employees, including those at subsidiaries.

Appropriate management and operations ofconfidential corporate and personal information
Basic policy
To ensure the safety of corporate and personal information, Sawafuji Electric appropriately manages and operates confidential in-

Revewing of compliance activities

formation through the Confidentiality Management Subcommittee.

The Internal Control Department is improving complianceby auditing, offering suggestions and making proposals
regarding improvements, if any, to the auditing divisions.
In response, the Company provided PL (product liability)
education for the parties concerned to urge them again to
fully implement compliance.

Confidential matters are classified by type and managed
accordingly. The Confidentiality Management Subcommittee
provides education to make the operation of confidential
matters known to all employees.
The Company handles personal information in a lawful andproper manner to protect individuals’ rights and interests.

Promoting system
To ensure thorough confidentiality, the general affairs/
personnel, corporate planning, technical administration andrelated divisions promote comprehensive IT management
and other confidential matters.

- Compliance Guide Book

Compliance
Guide Book

Education and training
Sawafuji Electric provides education regarding confidentiality
and information management in its compliance education
program; in particular, PC users undergo a test regarding thedegree of understanding IT.
The Company has set up an IT Help section on the intranet tohelp employees understand matters such as security and laws.

6

Economic Reports
WEB

Overview of Sawafuji Electric Group(*Figures are as of March 31, 2009)【Company name】

Sawafuji Electric Co., Ltd.

【Affiliated companies】 Sawafuji Software Development Co., Ltd. (SSD)【Established】【Founded】

June 10, 1908
June 10, 1934		【Capital】

1,080,500,000 yen*		【Outstanding shares】 21,610,000*

Ota-shi, Gunma

Engel Distribution Pty. Ltd.

(including treasury stock of 24,614 shares)*		【Number of shareholders】3,421*

Perth, Australia

Markon Sawafuji Ltd.

【Number of employees】 Consolidated		Ota-shi, Gunma

Sawafuji Transport Service Co., Ltd. (STS)

885*

		

Rutland, UK

Non-consolidated 768*

Earnings Reports

WEB

Early in FY 2008, prices of oil and raw materials rise sharply
and in the latter half of the year, the financial crisis triggered by
the subprime mortgage crisis rapidly spread from the U.S. to
Europe and the rest of the world. The world economy fell into
what has been called the worst recession in 100 years.
This worldwide recession affected Japan, where the yen
strengthened rapidly, stock prices decreased substantially,
corporate business conditions deteriorated due to a decline inproduction and exports and consumer spending dropped. As aresult, the Japanese economy continues to be sluggish.
In such an economic environment, the Sawafuji Electric Grouphas conducted business activities by always having a senseof crisis and an awareness of the problems involved, with thecustomers’ viewpoints in mind, under the slogan “No growth inSawafuji Electric without revolution.” Specifically, the Company
has continued its efforts to expand new sales routes worldwide
to supply products which meet customers’ needs in a timely
manner, raise production capacity, establish a technologicaledge over rivals and strengthen environmental measures.
At the same time, we have implemented emergency steps,
including a reduction in investments and a curtailment ofexpenses, by narrowing down related measures and reviewing
the priority of the said measures.
In FY 2008, however, demand increasingly weakened worldwide
and the yen appreciated sharply in the third and fourth quarters.
As a result, net sales declined 3,253 million yen (8.6%) from theprevious year to 34,731 million yen.

Earnings for FY 2008
Consolidated earnings of Sawafuji Electric for FY 2008 (the 113th term) are as follows.
- FY 2008 consolidated earnings results
Trends in net sales

Trends in ordinary income (loss)(Million yen)

(Million yen)

40,00030,00032,60835,171 35,310

37,9841,000

34,731892

0

10,000
2004

2005

2006

2007

△500

2008 ( FY )Trends in net income (loss)

△169
2004

2005

2006

(Yen)

1,000

536

2008 ( FY )

39.6

40

855

500

2007

Trends in net income (loss) per share(Million yen)

23.5

653

30.27

20

9.34

215
0

0
△2,000

657

1,062

500

20,000

0

1,384

1,500

50,000△1,670
2004

2005

2006

2007

△80

2008 ( FY )

7

△77.4
2004

2005

2006

2007

2008 ( FY )

Production and Sales BasesWEB

Sawafuji Software Development Co., Ltd. (SSD)
Ota-shi, Gunma

Headquarters and Nitta Plant, Sawafuji Electric Co., Ltd.
Ota-shi, Gunma

Sawafuji Transport Service Co., Ltd. (STS)Ota-shi, Gunma

Markon Sawafuji Ltd.
UK

Production of refrigerators
ThailandEngel Distribution Pty. Ltd.
Australia

Production base

Sales base

Electrical equipment

Electrical equipment

Generators

Generators

Refrigerators

Refrigerators

8

Main Products

WEB

Electrical equipment and electronics products for diesel engine trucks and buses

The Company manufactures and sells highly reliable electrical equipment, electronics
products and DC motors for small and large trucks and buses. The DC motors are used foroutboard engine tilts.

Starters(Rating: 24V/5kW)

Alternators(Rating: 24V/60A)

Computers for onboard use

DC motors(Rating: 12V/400W)

Generators

The Company produces and sells gasoline, diesel and gas generators that meet the voltage
specifications of each country and cover an output range of 1kW to 25kW.

SHX1000(Rating: 900W)

SH15D
SH11500(Rating: 9.5kVA/50Hz and 10.5kVA/60Hz) (Rating: 12kVA/50Hz and 13kVA/60Hz)

SH7600EX(Rating: 5.6kVA/50Hz and 6.5kVA/60Hz)

Refrigerators

The Company produces and sells authentic battery-driven AC/DC refrigerators andfreezers for leisure and business vehicles such as passenger cars, trucks, buses, campers andcruisers.

Refrigerator
MD14F(Capacity: 14L)

Refrigerator/freezer
MR040(Capacity: 38L)

Refrigerator/freezer
MT60(Capacity: 60L)

9

Freezer
STF-100F(Capacity: 90L)

Social Reports
Together with Customers
Sawafuji Electric strives to provide products, monozukuri (Japanese-style manufacturing) and services that meetcustomers’ needs, with the highest priority given to customer satisfaction and trust.

Development of products that satisfy customers

Monozukuri for customers

To meet customers’ needs, Sawafuji Electric conducts not
only long-term research and development with an eye toward
the future but also makes high quality products consistent
with speedy development by using cutting-edge magnetic
field analysis software and 3D CAD.

Sawafuji Electric is working hard every day to manufacture
products requested by customers from their viewpoint basedon the philosophy “Only make what is needed, when needed,in the quantity needed.”

Noise measurement of new refrigerators

Generator assembly line

Efforts to ensure quality in order to provide
reliable products

Service enhancement and quality
improvement

Sawafuji Electric has established a quality assurance
system to ensure that customers can use our products withsatisfaction, safely and without anxiety.

Giving the highest priority to customer satisfaction, SawafujiService Network, which consists of 261 companies provides
speedy service to our customers whenever an issue occurs,round the clock.
The Company also holds technology seminars and provides
services while going around the country, aiming to improve its
ability to handle consultations and complaints from our customers,
enhance our service system and raise our service quality.
In FY 2008, we established a service network on our website
through which we can quickly settle complaints and provide
technical information.

Efforts on quality improvement
Sawafuji Electric is constantly improving quality, placing top priority on
customer satisfaction and increased standard of the expected level ofquality and is carrying out quality assurance activities every day witheagerness based on a system in which not even the slightest sign ofproblems is overlooked.

WEB

Quality assurance system
Sawafuji Electric examines and deliberates new products at checkpoints
following the predetermined steps as to whether quality of the productis appropriately guaranteed, in accordance with the Company’s
standard Product Development Process. Only products that pass all
the checkpoints will be delivered to our customers as a new product.

- In-house system that reflects customers’ opinions
Customer
opinions
261 dealers
nationwide

8 distributors

Consumer Service Department(In-house LAN: company-wide disclosure)
Study onthe improvement
and commercialization of
products

Commercialization

Reliability evaluation test of starters with a large truck engine

10

Product Planning Department,
Development Department, Quality
Assurance Department, etc.

Large-room meeting(Study on development plans)Together with Local Communities
Company’s contribution activity basic policy

Sawafuji Electric as a whole is implementing social activities in line with its basic policy to contribute to society.
Basic policy- To contribute to society broadly from the viewpoint of CSR;
- To maintain a good relationship and seek coexistence with local communities; and- To further communication with the local population and conduct activities beneficial to local communities as a local community
member.

Activities for contributing to society
Participating in the Japanese Red Cross Society’s blood
donation campaign

Contribution to projects for protecting and breeding
albatrosses
Sawafuji Electric’s Engel refrigerators play a key role in the Ministryof the Environment’s Project to Establish New Breeding Places. Under
this project, the refrigerators transported to Mukojima in the Ogasawara
Island Chain, where they are used as containers to keep fresh feed foralbatross chicks (a rare wild species in Japan). The Company donatedtwo Engel refrigerators to the Yamashina Institute for Ornithology, which
is implementing the project, to be used for protecting the ecosystem.

Sawafuji Electric has taken part in blood donation campaigns conductedby the Japanese Red Cross Blood Center since 1976 through blood
donation activities by its employees. A total of 5,376 employees havedonated their blood over the past 33 years.
Recently, the Company was honored by the Minister of Health, Laborand Welfare for its continued and active involvement in blood donation
activities.
- History of commendations related
to blood donation activities- Blood donation results(person)120
100

Number of donors
89

96

104

99

80
75

60
40
20
0

Refrigeratorspresentation
ceremony

Protecting and breeding activities on Mukojima

2004

2005

2006

2007

2008 ( FY )1977: Received a letter of appreciation from the
President of the Gunma Prefecture Blood
Donation Promotion Conference.
1987: Received a letter of appreciation from the
Minister of Health, Labor and Welfare.
1997: Received the Japanese Red Cross
Society’s Gold Medal of Merit.
2003: Received the Gunma Prefecture
Governor’s Special Merit Award.
2008: Honored by the Minister of Health, Laborand Welfare.

Ecocap activities (Assistance with the NPO Ecocap Movement)
Since August 2008, Sawafuji
Electric has participated in PET
bottle cap collection activities toencourage recycling. The profits
from sales of the caps are used
to provide vaccines to children
throughout the world. The
In-house cap
Company delivers proceeds NPO’s poster
collection box
from the sale of PET bottle caps collected in-house to the Ecocap
Movement every month. In FY 2008, we were able to deliver vaccines
to 94 children.

Picture courtesy of the
Yamashina Institute for
Ornithology

Donation of refrigerators to cyclone hit Myanmar
On May 2 and 3, 2008, Myanmar was struck by a devastating cyclone
and the dead numbered in the ten thousands. Sawafuji Electric donated
16 small gasoline generators to the country as assistance in coping withthe disaster and sent the said generators to local UN agencies, NGOs
and Red Cross chapters through a
trading company.

Rendezvous point for medical helicopters
Sawafuji Electric’s grounds have been designated as a rendezvous
point for medical helicopters.
Rendezvous point

PR bulletin of medical
helicopters andthe grounds for therendezvous point11

Get-together with social welfare facilities

Gunma Fureai Festival in Ota

To further exchange with local communities, Sawafuji Electric, with its
labor union, invited people of local social welfare facilities as a volunteer
activity (June 2009).

Sawafuji Electric participated in the Gunma Fureai (get-together)Festival in Ota, where companies and labor unions jointly conducted
events, such as a lottery and impersonations and implemented a fundraising campaign to support projects for creating employment, aiding
people in finding employment and helping those who are trying tobecome economically independent (November 2008).

Playing tamaire with people of a social welfare facilities
sheltered workshop

Snapshot of the event

Local cleanup activities

Plant tour for a neighborhood junior high school
Sawafuji Electric actively invites students of neighborhood schools
to plant tours as part of their social studies classes and job hunting
activities as well as part of our activities to obtain able personnel inthe future.
In FY 2008, the Company conducted a plant tour for a junior high school(three classes totaling 95 students) (March 2009).

Cleanup activities around the plant
As part of our cleanup activities, Sawafuji Electric cleaned the area around theplant jointly with the association of production line managers of Hino Motors,
Ltd.’s nearby Nitta Plant (September 2008).

Cleaning Hayakawa Park
As part of our local cleanup activities, Sawafuji Electric’s employees cleaned
the areas around the plant and Hayakawa Park (May 2008).

Cleanup activities around the plant

Junior high school students visiting the assembly line

Opening of the grounds and the gymnasium to the public

Exchanges with local NPOs

Sawafuji Electric opens its grounds and gymnasium to locals to support
their club and association activities.

Sawafuji Electric takes part in local activities through an exchangewith NPO Nitta Kankyo Mirai no Kai. It assists local communities in thefollowing activities with the goal of coexistence with the community.
- Preservation of the local environment- Promotion of town planning

Members of a badminton lovers association practicing in
Sawafuji Gymnasium

NPO Bulletin

12Together with Shareholders and Investors

Together with Distributors and Dealers

Raising corporate value

Coexistence with distributors and dealers

To realize shareholder-first operations, customer satisfaction
and social contribution, Sawafuji Electric is making efforts
to implement compliance, product safety, environmental
preservation, thorough risk management including safetyand disaster-prevention activities, improvement in theinternal control system, increase in corporate ethics,
recruitment of high caliber personnel, improvement of
employee education, social contribution and disclosure of
information in a timely and appropriate manner.

Sawafuji Electric which has established systems tosell commercial parts and components, collect market
information and provide services by using the networks of
its distributors and dealers to fulfill its social responsibilities
in every business situations.
In FY 2008, the Company held meetings at of its 10 bases
nationwide, explaining our policies and strengthening
communication with our distributors.
We also held technical lectures to enhance services atthese distributors and dealers.

IR information

WEB

Sawafuji Electric believes that it is crucial to disclose its
business activities to the shareholders and investors
in a timely and appropriate manner to further promote
understanding of the Company.
As part of our investor relations (IR) activities, we issue abi-annual Shareholders Newsletter in addition to materials
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.
We also post our latest earnings information, previous
earnings reports and financial data and IR schedule on the“Investors Information” page of the Company’s website.

Regional meeting of
distributors- Sawafuji Service Network
Hokkaido
Fukuda Parts

and its 15 dealers

TohokuSendai Branch, Eiko ElectricIndustrial Co., Ltd.
and its 31 dealers

Kanto
Eiko Electric Industrial Co., Ltd.

- Top 10 major shareholders (as of March 31, 2009)
Name of shareholder
Hino Motors, Ltd.
Denso Corporation
Honda Motor Co., Ltd.
Sumitomo Mitsui Banking Corporation
Japan Trustee Services Bank, Ltd. (Trust account 4G)

Resona Bank, Limited
Sawafuji Electric Employee Stock Ownership Association

The Bank of Tokyo-Mitsubishi UFJ, Ltd.
The Chuo Mitsui Trust and Banking Company, Limited

Japan Trustee Services Bank, Ltd. (Trust account)

Shareholders’ stake in the Company
Number of shares
Percentage of
owned
ownership(1,000 shares)

6,535
2,000
1,300
600
507
500
433
400
300
278

WEB

and its 61 dealers
Shinetsu
Nagasaka Baroque Co., Ltd.
and its 12 dealers

30.27
9.26
6.02
2.77
2.34
2.31
2.00
1.85
1.38
1.28

Hokuriku
Hokuriku Office, Toyotsu Auto
Service Co., Ltd.
and its 16 dealers

Chubu
Toyotsu Auto Service Co., Ltd.

(Note) The percentage of ownership is calculated excluding treasury stock (24,614 shares).

and its 30 dealers

Kinki
Hanshin Branch, Kansai
Densokiki Co., Ltd.

- Classification of shareholders (as of March 31, 2009)

Foreign companies
0.6%

and its 30 dealers

Financial products traders
0.4%

Shikoku
Shikoku Densokiki
and its 11 dealers

Other domestic
companies
50.5%

Individuals
and others
32.9%

Chugoku
Nakayoshi Engineeringand its 28 dealers

KyushuNachi Shokai

Financial
institutions
15.5%

and its 27 dealers13Together with Suppliers
Mutual trust and prosperity
Sawafuji Electric pursues fair transactions and procures optimal parts by comprehensively judging the quality, price and delivery
time. To this end, the Company respects its suppliers as equal partners, maintains trustful relationships with them with the basic
philosophy of mutual trust and prosperity, seeking mutual development and growth.

Basic policy for procurement

Promotion of green procurement

Sawafuji Electric conducts
procurement activities withhigh priority given to communication with suppliers as
its basic policy to realize fair
and transparent transactionsof optimum parts and to establish strong partnerships.

To promote environmentally-friendly
procurement, Sawafuji Electric willfurther reduce substances with environmental loads through collaboration
with its suppliers pursuant to the
Guidelines for Green Procurement.

Basic philosophy
regarding procurement:
1) Development based on mutual trust;2) Thorough information exchange with
top management;3) Sharing of partnerships;
4) Promoting eco-friendly green
procurement; and
5) Ensuring thorough compliance andconfidentiality.

SAWAFUJI

Green Purchasing Guidelines

Guidelines for Green Procurement

Communication with suppliers
Procurement policy briefings and general meetings ofcooperating associations

Training sessions held by cooperating associations
Sawafuji Electric held an exchange meeting with suppliers’ executives
aimed at sharing its procurement policy for FY 2008, the progress of theCompany’s medium to long term strategies and key issues in activities
for the second half. At the meeting, which was attended by 87 suppliercompanies, participants held significant exchanges and recognized
the importance of further pushing ahead with improvement measuresthrough mutual collaboration given that the business environment is
forecast to remain severe for FY 2009 as in FY 2008.

Sawafuji Electric holds procurement policy briefings and general
meetings of cooperating associations to strengthen its alliances with
suppliers.
In FY 2008, 136 supplier companies attended the above briefing andgeneral meeting, in which the Company explained its procurement
policy for FY 2009 and gave letters of appreciation to the suppliers that
achieved superior results in quality and cost improvement or technicaldevelopment.

Supporting suppliers in quality improvement
Sawafuji Electric implemented cross-sectional improvement activities
regarding quality control, design and suppliers, with the goal of improving
and stabilizing the product quality of suppliers which are ranked C or D
in terms of quality. In FY 2008, the Company provided support for sevensuppliers, revising related drawings and reviewing the judgment criteria.
Joint product exhibition held with suppliers
Aiming to implement technological exchanges, Sawafuji Electric and its
suppliers held an exhibition in which overseas competitors’ products
were displayed for comparison purposes and suppliers’ proprietaryand other technologies were introduced. In the exhibition, which wasattended by 158 suppliers, significant exchanges took place and 146
improvement measures were proposed. The display of overseas rivals’
products was very
popular among participants.

Procurement policy briefings

Top management’s visits to suppliersWith the goal of enhancing mutual trust and shared partnerships
with suppliers, Sawafuji Electric’s president and officers in charge ofprocurement visit suppliers and exchange views with their executives.
In FY 2008, they visited 18 suppliers, shared items to be improved andother issues through on-site inspections and established a system tosolve such issues through mutual cooperation.

Product exhibition

14

Together with Employees
Sun Sun Action - Aiming towards the creation of valuable work worth doing
Since December 2006, Sawafuji Electric has implemented Sun Sun Action as a bottom-up activity based on the participationof all employees. Starting in the plant sector, the action has spread to the administrative sector, becoming a company-wide
action. Sun Sun Action is intended, as the words represent, to make Sawafuji Electric shine brilliantly like the sun and hence
Sun Sun Action
logo markit should be conducted by all employees. The concept of Sun Sun Action is as follows:
1) Valuable work worth doing will make individuals, workplaces and the Company shine with brilliance.
2) To realize the above, we will find wasteful and excessive work and rules as well as problems in our workplaces and rectify or eliminate them.
3) We will establish ways and rules to improve work to be followed by every company member to raise the value, quality and efficiency of work.
The above items should be noted in implementing this activity. Every workplace display a notice regarding the Sun Sun (3 x 3)
Action and the Code of Conduct.
Results of the Sun Sun Action
Visualizing all employees’ proposals and measures

In the plant sector, the number of improvements has reached 17,000 anddefects for FY 2008 decreased by 35% from the previous FY. By August 2009,
the total number of proposals totaled 2,780 in administrative sector. Sawafuji
Electric created the President’s Award, where the Excellence Award, thecompany’s highest award and the special award are awarded to employees fortheir excellent proposals on the anniversary of the company’s establishment.

Sawafuji Electric is promoting the Sun Sun Action while visualizing related
proposals and measures. In the plant section, workers post points to be
remedied on the bulletin board and the post will not be deleted until the issue
is rectified. The administrative sector visualizes the proposals and measuresthrough the groupware.

Employment and personnel training

Creating a workplace which is easy to work in

Personnel system and training by rank

Flextime system, child-care leave system, nursing-care leavesystem and volunteer leave system

Personnel system
Positioning personnel training as its core, Sawafuji Electric strives to revitalize
its organization, while considering individual employees’ initiative and creativity
important. The Company also makes a strong effort to develop employees’
abilities, hoping this will help them demonstrate their initiative and creativity
in its business activities. Furthermore, it aims to build a system under which
employee performance is assessed fairly and impartially.

Sawafuji Electric has established the following support systems to help
employees balance work and private life.
- A flextime system which supports employees in working efficiently andunder their own initiative;- Persons taking child- A Child-rearing leave system which helps
rearing leave
employees raise children under one year of age;
- A Nursing-care leave system which allows
Number of persons
FY
taking child-care
employees to take leave so that they can lookleave
after family members in need of care; and2006
1- A Volunteer leave system which supports
2007
5
employees in engaging in voluntary social
2008
3
service activities.

Training and development
In order that its employees can demonstrate their ability in their positions,
Sawafuji Electric formulates training plans every year by rank and function
and holds training for new employees, experienced and able employees as
leaders of work, new managers and supervisors. For the development of
its employees, the Company also implements education, through various
educational courses by correspondence, meetings for presenting research
papers and lectures.

Certified comfortable workplace
Sawafuji Electric strives not only to create a working environment that meetsthe safety and sanitation standards stipulated by laws and regulations, butalso to prevent work-related accidents by improving the working environment
based on its own plan. In FY 2008, the Company was certified by the Gunma
Labor Bureau as an entity with a plan to create a comfortable workplace.

Human rights, equal employment and respect for diversity
Re-employment system and promoting the employment for the disabled
Currently in Japan, employees are aging while the number of younger workers
is decreasing rapidly. Against this backdrop, Sawafuji Electric has introduced
a retiree re-employment system with the goal of providing a workplace where
eager-to-work elderly people can demonstrate their knowledge, skills andexperience to the maximum and pass on their knowledge, technologies andskills to the next generation.
The Company also provides a work environment in which disabled people
can work without anxiety and employs such people in accordance with the
Disabled Persons Employment Promotion Law. In FY 2008, the Company’s
ratio of disabled employment was 2.15 percent, exceeding the statutory
employment ratio of 1.8 percent. For this FY, we will further promote theemployment for the disabled.

Certificate received
from the Gunma
Labor Bureau- Ratio of disabled employment- Reemployed persons
FY

Number ofreemployed persons

Ratio ofreemployment

FY

Ratio of disabled
employment

2006
2007
2008

5
19
12

33.3%
72.0%
63.2%

2006
2007
2008

2.42%
2.29%
2.15%

15

Safety and hygiene

Health care

Safety philosophy and safety promotion system

Health examinations
In order to promote the health care for its employees, Sawafuji Electric
conducts health examinations in accordance with related laws andgives health guidance to those who were diagnosed with problems.
The Company also supports its employees in undergoing thoroughphysical checkups and cancer examinations. The number of employees
who underwent health examinations totaled 906 in FY 2007 and 989 in
FY 2008.

Under the slogan “Safety must come first,” Sawafuji Electric has
established a safety and hygiene management system, under which itis promoting the following.
- Promulgation of safety rules and reform of safety awareness- Implementation of prior safety measures against workplace risks andprevention of such risks, through identification and reduction of such risks- Review and improvement of safety rules- Promotion of creation of a happy and comfortable workplace(Subcommittees activities)- Disaster Prevention Measures Subcommittee
Detecting difficult-to-find risks through on-site patrols- KYT ( Kiken Yochi Training ) Promotion Subcommittee
Providing KYT training and managing rules concerning dangerous vehicles such as forklifts- Health Promotion Subcommittee
Finding sanitary risks through patrols- Traffic Safety Subcommittee
Eliminating traffic accidents through overall traffic management- Fire Prevention Subcommittee
Eliminating fires through the focused management of high-temperature facilities

Snapshot of healthexamination vehicles

Safety activities
Reduction of risks

Mental health care training session

Each year, Sawafuji Electric conducts activities to reduce the risk of disasterin the plant sector in order to prevent high risk activities. The results of our risk
reduction activities for FY 2008 are as follows.
- Results of risk
		
reduction activities
Risk
		
Ⅳ
Ⅲ
Ⅱ
Ⅰ

FY 2007

Sawafuji Electric has introduced a mental health care system underwhich it promotes employee self-care, manager and supervisor linecare and care by industrial doctors, nurses and outside specialists.
In FY 2008, the Company held a mental health care training session
for managers and supervisors, which was attended by 123 persons,following 48 in FY 2006 and 113 in FY 2007.

FY 2008

After improvement Before improvement After improvement
in risk factor control in risk factor control in risk factor control(no. of cases)(no. of cases)(no. of cases)

0
0
0
3,247

1
374
2,622
748

0
0
0
3,745

Safety and hygiene training
Sawafuji Electric proactively conducts training programs, including safety
training for new employees in April, safety training for the administrative sector
in June and forklift safety training in October. Through these training activities, the Company boosts
employees’ awareness ofhygiene safety and sanitation.

Mental health caretraining session

Preventive measures against heat
Safety and sanitation
training

Traffic safety program

Sawafuji Electric provides a traffic safety program through lecturers from thelocal police station for all employees once a year in order to increase employee
awareness of traffic safety and prevent traffic accidents. In FY 2008, thisprogram was conducted in
October and was attended
by 905 employees.

As part of measures against heat, Sawafuji Electric offered a seminarby health care consultants regarding heatstroke preventive measurestargeting all employees. Through this seminar, the Company aimed
to educate its employees regarding heat and heatstroke prevention
measures. The seminar was attended by 156 employees.

Seminar on heatstroke
preventive measures

Traffic safety
program16

Environmental Reports
WEB

Environmental Policy(1) All the Company’s sections engaged in development and manufacture of products and provision of services shall strive to appropriately
reduce environmental impact in all their business activities, for example by promoting conservation of natural resources, energy and reducing
waste.
(2) The Company shall strive to continuously improve the environment and prevent any contamination.
(3) The Company shall comply with environmental laws, regulations and other requirements and shall be responsible for administering businessactivities based on its voluntary management standards.
(4) To carry out this policy, the Company shall establish the purpose and objectives of environmental protection, implement related activities in a
carefully planned way, review the contents of such activities on its own, receive audits by third parties and confirm the results.
(5) The Company shall document this policy, implement and maintain this policy under the environment management system and make thispolicy known to all people who work in and for its organization. In addition, the Company shall strive to provide education and implement
training in order to increase employees awareness of environmental conservation.
(6) The Company shall contribute to the environmental conservation in local communities as much as possible and strive to live together withlocal communities.
(7) The Company shall disclose this policy and make it available to the public.

Kiyoshi Takada
President and Representative Director,
Sawafuji Electric Co., Ltd

Established: May 1997
Revised: June 2005

Environmental Management
Environmental Management Promotion Structure

In order to promote environmental conservation activities, Sawafuji Electric has established a company-wideorganization called the “Environment Committee” under the leadership of the President. This committee determines
basic policies and promotes various environmental activities.
The Company has also established special committees under the Environment Committee to promote environmental
conservation activities in respective fields.

President

Environment
Committee

Environment TechnicalCommittee- To promote environmental conservationfrom the perspective of product andtechnology development- To promote LCA- To devise measures for handling
substances that affect the environment

Production Environment
Committee- Environmental conservation in
production activities- Promotion of environmental events

Social Activities Promotion
Committee

Affiliates Environment
Committee- Promotion of social contribution activities- Support for voluntary activities- Promotion of environmental activities
by affiliates

A mother spot-billed duck andher chicks in the pond theheadquarters’ gardens

17

Operations of Environmental Management System
Since aquiring the ISO 14001 Environmental Management System certificate in 1997, Sawafuji Electric has
continuously improved operations of the environmental management system by conducting internal environment
audits and undergoing external examinations, on a regular and yearly basis.

1.
Environmental
policy2. Planning

ISO 14001
Environmental
Management
System6.
Continued
improvement- Environmental aspect- Legal and other requirement
conditions- Purpose and objectives- Environmental management
programEnvironment audits
5.
Review by
management

3. Implementation and operations

4. Inspection and remedy- System and responsibilities- Training, awareness and ability- Communication- Documents on the environmental
management system and their retention- Operational management- Preparation for a state of emergency andcoping with it- Monitoring and measuring- Remedy measures in the case of
inappropriateness and preventive
measures- Recording- Environmental management
system audits

FY 2008 marked the 11th
anniversary of obtaining the ISO
14001 certification. The Company
was ISO 14001 certified again
after undergoing the examination
for renewal by Japan Quality
Assurance Organization.

Allocated Resources and Environmental Impact of Emissions in Business Activities
Products manufactured by Sawafuji Electric and the energy the process uses affect the environment in the form ofwaste and CO2.
Through its environmental protection activities, the Company identifies the processes that have an environmental
impact and reduces the impact thereof.
Development anddesign- Increasing therecycling rate
- Reducing productmass

Materials and partsprocurement- Reducing substancesthat haveenvironmental impact

Recycling anddisposal- Rebuilt service- Recycling of home
appliances

Sawafuji Electric willcontinue environmental
conservation efforts andkeep nature clean.

Production

Use of products- Energy-saving
activities- Reducing wastes- Means for energy
saving- Saving energy

Logistics- Fuel-efficient driving- Clean energy vehicles

Targets and Results
The following are targets and results for FY 2008.
Policy for efforts

Targets

Target FY

Results for FY
2008

Active promotion of measures for reducing CO2
emissions in production activities

To reduce the ratio of CO2 emissions to net sales by 22
percent from FY 1990 levels

2010

21% reduced

Miniaturization of products and saving energy inthe production development phase

To reduce CO2 emissions in manufacturing andoperating products by 25 percent from FY 1990 levels

2010

22% reduced

Substituting four ELV Directive substances and six
Control andreduce substances RoHS Directive substances for other substanceshavingenvironmental
Reduction in emissions of PRTR-listed
impactsubstances in production activities

To totally abolish four ELV Directive substances and six
RoHS Directive substances

Item
Global warming
prevention

As required

By major customer
destinations and requests

Continued

2010

1% reduced

Waste reduction Promotion of economizing resources in production To reduce the ratio of waste dumping to net sales by 36
and energy saving activities
percent from FY 2001 levels

2010

43% reduced

Water resource
economization

2010

55% reduced

Promotion of reducing water usage in production
activities

To reduce the ratio of PRTR-listed substances to net
sales by 30 percent from FY 2001 levels

To reduce the ratio of water usage to net sales by 37
percent from FY 2001 levels

18

Environmental Education and Training

Environment Accounting

To have the environment management system functioning
effectively, Sawafuji Electric provides environmental
education for all its employees and workers of othercompanies which operate on it’s premises. The Company
also has every employee carry an environment card that
describes the environmental policy as well as his or her own
objectives, targets and actions, aiming for every employee
to conduct business activities while being highly aware ofenvironmental conservation. The Company commends
offices for their improvement of energy and resources-saving
measures during its monthly energy-saving campaign heldeach February, aiming to educate it’s employees. In addition,
the Company provides support for training to those whowant to obtain qualifications to engage in special operations.
Furthermore, the Company is continuously providing training
for dealing with emergencies and preventing environmental
pollution.

The Company has computed environmental conservation
costs and effects based on “Guidelines for Identifying andDisclosing Environmental Conservation Costs” issued by the
Ministry of the Environment.
The Company put in management resources in costs
relating to environment conservation, such as research anddevelopment, business investment, recycling activities andcontinuously promotes the strengthening of environmental
activities.

Environmental conservation costs(Unit: Million yen; “-” represents costs below one million yen)

Item

Businessarea costs

73

Upstream
anddownstream
costs

Costs for recycling, collecting and appropriately
disposing of products
Additional costs for reducing environmental impacts
through green purchase and other measures

1

Costs for operating and maintaining the environment
management system
Administration Costs for monitoring environmental impact
costs
Costs for disclosing environmental information andproviding employees with environmental training

37

R&D costs

Training during a state of emergency (oil spill)(March 2009)

Environmental Accidents and Complaints
To support its production activities at plants, Sawafuji Electric
operates a special high-voltage transformer substation, acogeneration system for independent power generation,
boilers, water supply and drainage systems, environmentrelated equipment such as waste storage facilities and otherapparatus, as well as over 2,000 manufacturing facilities.
The Company complies with related laws, regulations,prefectural ordinances and the Environmental Pollution
Prevention Agreement with Ota City. It also carries out
monitoring regularly, with respect to substances that are
generated by operating such facilities and equipment andthat affect the environment. The Company is also striving toprevent any environmental pollution accidents, by identifying
environmental risks, reassessing such risks and providing
training for dealing with any possible emergencies to prevent
such emergencies from affecting the environment.
During FY 2008, there were no environmental accidents andcomplaints.

Costs

Costs for preventing environmental pollution such as
air pollution, water contamination
Costs for conserving the global environment throughenergy saving and other measures
Costs for recycling resources through waste recycling
and appropriate disposal of waste

R&D costs for environmentally conscious products
R&D costs for curtailing environmental impact

267

Costs for supporting environmental improvement
made through tree planting, beautification and otherSocial activity measures
costs
Costs for contribution to society through environmental
activities in local communities and other measures

1

Environmental
remediation Costs for restoring the nature
costs

ー
379

Total

Environmental conservation effects(Unit: Million yen)

Item
Revenue Gains from recycle-related sales
Energysaving19

Improvement effects from the use of cogeneration
systems and photovoltaic power generation
systems and the implementation of energy-saving
activities

Effects
75.0
10.5

Resources Improvement effects from the implementation ofsaving resources saving and recycling activities

6.0

Total

91.5

Considering the Environment in Product Development
Reduction of product mass through miniaturization andweight reduction and reducing CO2 emissions throughefficiency improvement with power-saving products

Efforts in the 3R (reduce, reuse and recycle) program

ReduceTo reduce product mass, Sawafuji Electric is continuously miniaturizing and lightening electrical equipment and generators.
By reducing product mass, when products are manufactured
CO2 emissions can be achieved.

Sawafuji Electric reduces waste by changing the shape ofparts and improving the processing method thereof.

Weight has been reduced bychanging the shape of case
- Starter parts

The Company focuses on the electric-power saving capability of it’s refrigerators by improving efficiency at the time ofcompressor startup.

Rotor core

Reuse

In response to environmental laws and regulations, requests
from major customers and its Guidelines for Green Procurement, Sawafuji Electric has established a system to write
environment-related items on its drawings so that environmental load substances can be managed. The Company isworking on totally abolishing the targeted substances fromall of its products. Furthermore, it is making efforts so that its
products comply with the REACH (Registration, Evaluation,
Authorization and Restriction of Chemicals) Regulation.

ELV directives

Generator

Reuse: Using recyclable resources as products orparts

Sawafuji Electric cuts unused corrugated cardboard into
the proper size and reuses them as cushioning materials
for product packaging.

Reuse of corrugated cardboard- Cushions for products packed

A rack for corrugated cardboard to be reused

Refrigerator

RecycleRoHS directives

Regulations Voluntary regulations of
RoHS directive
to be met the Japan Automobile EU member country

Manufacturers
Association, Inc.

Improvement of production yields
by adopting a family mold for thestarter core and the rotor core
- Generator parts

Starter core

Response to regulations on environmentalload substances

Electrical equipment

Reduce: Reducing the amount of waste

regulations

ELV directive: An EU directive which aims to reduce and appropriately dispose of wastefrom end-of-life vehicles and which bans lead, cadmium, hexavalent chromium andmercury from products.
RoHS directive: An EU directive which limits the use of certain hazardous substancesin electronic and electrical equipment, including lead, cadmium, hexavalent chromium,mercury, PBB and PBDE.
REACH Regulation: A new comprehensive EU legislation concerning the registration,
evaluation, authorization and restriction of chemical substances, which went into effecton June 1, 2007.

Use of substitute chlorofluorocarbons

Recycle: Using recyclable resources as raw materials

To promote the use of recycled materials, Sawafuji Electric
introduced material quality marking for used resin to makerecycling of resin parts easier.

Use of materials recycled frominner cases- Refrigerator parts

Use of materials recycled frombobbins- Starter parts

Efforts to reduce exhaust gas and improvefuel efficiency

Sawafuji Electric is considering the use of substitute chlorofluorocarbons, which have a low global warming potential
and ozone depletion potential, for its refrigerators instead of
R134a, which is currently being used.

Diesel commercial vehicles are increasingly using motors to
drastically reduce exhaust gas as well as hybrid systems thatare effective in lowering fuel consumption.
Sawafuji Electric is actively conducting R&D on electricpowered auxiliary machinery that uses DC brushless motors
as well as on hybrid construction and industry machinery.
In addition, the Company is developing and designing highefficiency, high power alternators, anticipating that power
consumption will increase sharply with the popularization ofelectric-powered auxiliary machinery.

Response to REACH Regulation
Sawafuji Electric is investigating chemical substances in
its components while actively collecting the informationnecessary for making its parts compliant with EU’s REACH
Regulation.

20

Considering the Environment in Production
Prevention of Global Warming(reducing CO2 emission)

Reduction of CO2 Emissions by a Photovoltaic
Power Generation System

Sawafuji Electric is implementing global warming
preventive measures with the goal of “reducing CO2
emissions by 22 percent from FY 1990 till the end of FY
2010.”All the employees, highly aware of energy saving, arepromoting a reduction in the electricity consumed bylighting fixtures and OA equipment, efficient operationsof facilities and equipment and less air leakage. Staff at
the plant are also promoting energy saving by recording
daily power consumption data from the electric meter
installed in each section within the plant, while checking
the effects of each workplace’s activities to improveenergy saving.
In FY 2008, the Company reduced the amount of
CO2 emissions per 1-million-yen sales by 20 percent
compared with FY 1990.

In February 2008, Sawafuji Electric began to operate
a 100 kW photovoltaic power generation system on afull-scale basis. This system enabled the Company toreduced CO2 emissions by 41 tons during the period
between April 2008 and March 2009, which is equivalent
to 0.75 percent of the average annual amount of CO2
emissions.
Power Generation
Results forJune 2009 [1]Amount of solar radiation
Temperature
Generated energy- CO2 emissions per 1-million-yen sales
（㎏）
240
220

Photovoltaic power generation monitor

219

212
192 186193

200

173179176172

180

171

160
140
120
100

'90

'01 '02 '03 '04 '05 '06 '07 '08
Results'10 ( FY )TargetSolar panels

Reducing Waste and Saving Resources

Sawafuji Electric is making efforts to reduce the amount of waste it produces with the goal of “reducing 36 percent fromFY 2001 till the end of FY 2010.”
In FY 2000, the Company achieved zero landfill waste, recycling all its waste.
The Company established a recycling center in FY 2008.
The amount of waste per 1-million-yen sales for FY 2008 has decreased 43 percent from that of FY 2001. The
Company will continue to reduce the amount of waste by further minutely subdividing such waste at the source.
- CO2 emissions per 1-million-yen sales（㎏）
30 28.2
25

22.3

20

19.0 18.8 19.2 18.2

15

16.4 16.2

18.0

10
5
0

'01

'02

'03

'04

'05

'06

Results

Recycling center

21

'07

'08

'10 ( FY )TargetEfforts to Protect the Soil and Ground Water

Control of Chemical Substances

Sawafuji Electric previously used 1.1.1-trichloroethane,but totally abolished its use in FY 1995 and since then it
has investigated the state of pollution of soil and groundwater.
According to the above investigation, we have notdetected any 1.1.1-trichloroethane at the moment.
However, we found that the level of 1.1-dichloroethylene,
which is produced as a result of 1.1.1-trichloroethane
resolving, at a place within the plant site exceeds theenvironmental standard value. In response, the Company
has implemented purification measures, in which gas in
the soil on the site is sucked out and removed using
activated charcoal, since FY 1999.
The Company is continuously monitoring the effects of
1.1-dichloroethylene on the soil outside the plant site by
constructing observation wells at the border of the plantsite. Levels of 1.1-dichloroethylene are far below theenvironmental standard value.
We will continue such monitoring.

Reducing emissions of chemical substances subject to
PRTR
Sawafuji Electric is making efforts to “reduce the emissions of chemical
substances subject to PRTR by 30 percent from FY 2001 till the endof FY 2010.” In FY 2008, emissions of such chemical substances
per 1-million-yen sales dropped 1 percent compared with FY 2001.
Henceforth, the Company will endeavor to reduce the emissions of suchchemical substances by further reusing paint diluents.
- Emission of chemical substances subject to PRTR per 1-million-yen sales

（㎏）
2.0
1.5

1.461.38 1.40 1.45 1.39 1.45 1.39 1.44

1.0

1.05

0.5
0.0

'01

'02

'03

'04

'05

'06

'07

'08

Results'10 ( FY )Target

PRTR
PRTR (Pollutant Release and Transfer Register) is a system for collecting, compilingand publishing data on various types of hazardous chemical substances regarding
their sources, the quantity discharged into the environment and whether they were
contained in waste transferred off-site.

Economization of Water Resources

Sawafuji Electric is striving to “reduce the total amount ofwater used at plants by 37 percent from FY 2001 levels
till FY 2010.”
In FY 2008, such water consumption per 1-million-yen
sales dropped 55 percent compared with FY 2001.
The Company reduces its use of water by reusing water
purified at a wastewater-treatment plant as cooling waterfor plants.

Storage of PCB (polychlorinated biphenyl)
As of the end of FY 2008, we held five condensers that contain PCB as
insulating oil, which we appropriately manage.

- Water consumption per 1-million-yen sales

Reduction of VOC
（㎥）
5 4.7
4

3.9

3

3.3 3.01 3.21

3.00

2.51

2

Sawafuji Electric is reducing the amount of thinner by extracting
thinner from used paint in the painting process and reusing it for otherpurposes.
The Company also abolished the use of styrene by switching some
impregnating varnish to solvent-free type.

2.96
2.08

1
0

'01

'02

'03

'04

'05

Results

'06

'07

'08

VOC
VOC (volatile organic compounds) is a general term for volatile organic chemicalcompounds.
VOCs are organic compounds that are volatile and vaporizes into the atmosphere,
which contains various substances such as toluene, xylene and ethyl acetate.

'10 ( FY )Target22

Considering the Environment in Logistics

Considering the Environment in Communication

Reduction of CO2 Emissions during Product Transportation

Environmental Communication

Sawafuji Electric is striving to “reduce CO2 emissionsin product transport by 45 percent from FY 2001 till theend of FY 2010.”
In FY 2008, the Company reduced CO2 emissions
during product transportation per 1-million-yen sales
by 49 percent as compared with FY 2001, throughswitching to low fuel-consumption vehicles and energysaving driving.

Participation in the Ota City Industry and Environment
Festival
Sawafuji Electric has issued environmental reports hoping that its
environmental activities will be widely understood among people.
To gain the understanding of local residents regarding its environmental
activities, the Company has participated in environment festivals
hosted by local governments every year. Our booth has been always
popular among the local people and various organizations.

- CO2 emissions in product transport per 1-million-yen sales（㎏）
50 45.0
40

40.2

30

33.5

28.1 25.1 25.3

22.6 23.1

'04

'07

24.8

20
10
0

'01

'02

'03

'05

'06

'08

'10 ( FY )TargetResults

Environment festival hosted by a local government inNovember 2008

Clearing trees within the plant

Reducing the Use of Packaging Materials

Sawafuji Electric is endeavoring to “reduce the useof packaging materials when transporting finishedproducts and spare parts by 43 percent from FY 2001
till the end of FY 2010.”
In FY 2008, the Company reduced the use of packaging
materials per 1-million-yen sales by 41 percent fromthat of FY 2001.

Sawafuji Electric holds meetings with the heads of the Shimotanaka,
Hanakazuka and Hayakawa areas every July and December, responds
to the requests they submit and implements the environmental
protection measures discussed. Through these efforts, the Company
is striving for harmonious coexistence with local communities.
In FY 2008, we cut down trees within the plant and gave them to local
ceramists as fuel for kilns.

- Use of packaging materials per 1-million-yen sales

（㎏）
4 3.7

3.4

3

2.7 2.7 2.52

2.2 2.0 2.2

2.1

1
0

'01

'02

'03

'04

'05

Results

'06

'07

'08

'10 ( FY )TargetClearing trees within the plant

23

Environmental Data
Atmosphere

Chemical substances subject to PRTR

In addition to conventional boilers for heating systems,
a cogeneration system started operations in January
2003.
This operation meets the Air Pollution Prevention Law,
prefectural ordinances and the Environmental Pollution
Prevention Agreement with Ota City.

To promote eco-friendly procurement activities, Sawafuji
Electric will further reduce substances with environmentalloads through discussions with its suppliers pursuant to
the Guidelines for Green Procurement.

Item

Unit

Regulation
value

Measured
value

NOx

ppm

180 or less

56

SOx

K value 17.5 or lessbelow 0.5

Soot and
dust

g/m3N

0.1 or lessbelow 0.005

NOx

ppm

950 or less

604 or lessSOx

K value 17.5 or lessbelow 0.5

Facility

Boiler(Kerosene)

Cogeneration(Fuel oil A)

Soot and
dust

g/m3N

( Unit: ton / year )Substance
nameAmounthandledAmountdischarged
Air

Amounttransferred

Water
Waste Public
area
sewerage

RemovalRecycleAmount ofAmount consumption
removed

Styrene26.2 26.2

0.0

0.0

0.0

0.0

0.0

0.0

Xylene

12.0

7.1

0.0

0.1

0.0

0.0

0.7

4.1

Toluene

15.3

8.9

0.0

1.1

0.0

0.0

0.1

5.2

Ethylbenzene

2.7

1.7

0.0

0.0

0.0

0.0

0.2

0.8

Lead
compound

1.5

0.0

0.0

0.0

0.0

0.2

0.0

1.2

- Amount handled: 1 ton/year or more (500 kg/year or more for Class 1 Specified Chemical Substance).
- Amount removed: Amount removed through incineration treatment, decomposition treatment, etc.
- Amount of consumption: Amount of substances that have changed to other substances through reactions, oramount of substances that are contained in products transferred off-site or transferred off-site together withproducts.

0.1 or less 0.012 or less

Water Quality

Water used within the plant is treated at wastewater-treatment plants and purified water is discharged into the Hayakawa
River. This discharge meets the Air Pollution Prevention Law, prefectural ordinances and the Environmental Pollution
Prevention Agreement with Ota City.
Item

Unit

Regulation value

Maximum value

Minimum valuepH―

6.5~8.0

7.3

6.9

BOD

mg/ℓ

10 or less6

below 1COD

mg/ℓ

10 or less

5.7

1.4

SS

mg/ℓ

15 or less2

below 1

N.H oilmg/ℓ

3 or lessbelow 1

Phenolmg/ℓ

0.2 or lessbelow 0.025

Copper content

mg/ℓ

1 or less0.02

below 0.02

Zinc content

mg/ℓ

1 or less

0.71

0.13

Soluble iron content

mg/ℓ

4 or less0.04

below 0.02

Soluble manganese content

mg/ℓ

5 or less0.04

below 0.01

Chrome content

mg/ℓ

0.2 or less

Fluorine compound

mg/ℓ

1.5 or lessTotal phosphorus

mg/ℓ

8 or less

1.9

Total nitrogenmg/ℓ

60 or less

4.7

Lead content

mg/ℓ

1 or lessbelow 0.04

24

below 0.02
0.56

below 0.2

History of Environmental Efforts and Activities
1975 :

Completes construction of a new plant.
Establishes industrial wastewater treatment facility (coagulating sedimentation method).
Establishes domestic wastewater treatment facility (activated sludge combined process method).
Establishes rainwater (oil) separating tank.

1976 :

Moves to Nitta Plant, which starts operations.
Concludes Environmental Pollution Prevention Agreement with Nitta-cho (Note).
Establishes smokeless incinerator.

1984 :

Sets up Energy-Saving Committee.
Launches company-wide energy-saving activities.

1993 :

Begins activities of Production Environment Committee of Hino Motors Ltd. affiliate.
Totally abolishes specified chlorofluorocarbon for refrigerator insulating materials (CFC11  HCFC-141b).

1994 :

Sets up Environment Committee.
Totally abolishes specified chlorofluorocarbon for refrigerator coolants (CFC12  HFC-134a).
Totally abolishes ethane for parts cleaning (Trichloroethane  Alkali cleaning).

1995 :

Totally abolishes specified chlorofluorocarbon for parts cleaning (CFC113  Alkali cleaning).
Starts removal of the plant ceiling’s asbestos insulating materials (continues until 1998).
Formulates Environmental Conservation Action Plan.
Reorganizes Environment Committee.

1996 :

Launches ISO 14001 Certification Acquisition Promotion Committee and starts preparation for its
acquisition.

1997 :

Acquires ISO 14001 certification.

1998 :Starts energy and resources saving efforts.
Begins efforts to reduce mass of products developed.

1999 :Starts waste zero emission efforts.

2000 :

Begins efforts to reduce unit requirement of CO2 emissions.

2001 :

Achieves non-landfill waste.

2002 :

Abolishes incinerators.

2003 :Starts operations of the cogeneration system.
Launches recycling of cups and containers for beverage vending machines.
Totally abolishes specified chlorofluorocarbon for refrigerator insulating materials(HCFC-141b  HFC-245fa and HFC-365mfc).

2004 :

Introduces high efficiency air compressors.

2005 :

Installs air-supply valves for each plant area.

2006 :

Begins a study for introducing a photovoltaic generation system.

2007 :Starts operations of the photovoltaic generation system.

2008 :

Replaces office buildings’ lighting fixtures with energy-saving type.
Switch to LPG fuel for forklifts started.
(Note) Nitta-cho merges with Ota City in March 2005.

25

Issuance

Sawafuji Electric has issued an environmental report which compiles the results of activities for preserving theenvironment since FY 2003 under one of its management philosophies, “keeping nature clean.”In FY 2008, the Company issued the Environmental and Social Report 2008, which takes into account its environmental
activities and corporate social responsibility. For the current FY, however, the report is issued as a CSR report focusing
more on describing the Company’s relationships with society, management and employees. The purpose of this reportis to have better communication with our various stakeholders, such as customers, local communities, shareholders,investors, distributors, dealers, suppliers and employees and to further improve our contents of approaches.
The CSR report covers economic, social and environmental aspects. In this report, however, economic aspects are
partially described as earnings reports, since the overall contents of such aspects are stated in our Yukashoken
Hokokusho (financial documents).
Detailed earnings reports are posted on Sawafuji Electric’s website.

WEB

Please refer to Sawafuji Electric’s website for details on those items with the “Web” mark.
( http://www.sawafuji.co.jp/ )Description and period covered

Issue month and next issue monthThis report covers Sawafuji Electric’s social and environmental
protection activities, the results of such activities for FY 2008
and related efforts made before the issue of this report.
This report details environmental protection activities andefforts made in the Company headquarters and the Nitta
Plant.

Issue month:
October 2009
Next issue month: September 2010

Back issues
FY 2008: Environmental and Social Report
FY 2007: Environmental Report
FY 2006: Environmental Report
FY 2004: Environmental Report
FY 2003: Environmental Report

Guidelines referred toEnvironmental Report Guidelines (FY 2007 edition) issued by
the Ministry of the Environment and Sustainability Reporting
Guidelines of GRI

Offices and plants:

Inquiries:

Headquarters and Nitta Plant
3 Nittahayakawa-cho, Ota-shi, Gunma 370-0344
Tel: +81-276-56-7111 (main)
Fax: +81-276-56-6413
Tokyo Office

Headquarters and Nitta Plant
Management and Planning Department
Tel: +81-276-56-7134
Fax: +81-276-56-6413
Environment Safety Department
Tel: +81-276-56-7334
Fax: +81-276-56-7394

51-13 Ikebukuro 2-chome, Toshima-ku, Tokyo 171-0014
Tel: +81-3-5391-1221 (main)
Fax: +81-2-5391-1228

Cover image
The cover image represents all employees’ desires to fulfill three
corporate responsibilities hand in hand to create a better tomorrow- corporate management responsibilities, contribution to society andconsideration of the environment.

Sawafuji Electric Garden26

3 Nittahayakawa-cho, Ota-shi, Gunma 370-0344, Japan
Utilizing 100% post-consumer
recycled paper pulp