Top Message

Sustainability Report 2020

Environment

Society

CultureGovernanceAnnex

Contents

6

Environment

41

23

CultureSociety3

CEO Message

49

Governance

53

External Evaluations

4

Sustainability Top Message

51

Implementation Framework

54

Environmental Data

5

Sustainability Strategy

56

Social Data

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CEO Message
Masahiko Uotani
Representative Director,
President and CEO

COVID-19 ravaged the world in 2020, triggering an economiccrisis unforeseeable at the beginning of the year. The cosmetics
industry was also greatly affected by lifestyle changes resulting
from COVID-19, such as staying at, and working from home.
Under devastating economic conditions, Shiseido employees
around the world thought about how they could contributeto recovery and took a number of initiatives. For example,
amid shortages of hand sanitizers, we speedily repurposed
production lines at each of our factories in Japan, the USA, andFrance and started manufacturing hand sanitizer for donation
to healthcare workers, followed by general sale. In terms ofour beauty business, we offered beauty information and tips
for the “new normal” of living with COVID-19, commenced
online counseling by beauty consultants, and developed andlaunched products in line with new needs, such as mask-proof
BB cream. We have gone above and beyond to think outside
the box and contribute to society using our knowledge as acosmetics company.
We believe that to create true value, it is vital for a company totake actions and resolve environmental and other social issues

through its core business. That is why sustainability is at thecore of WIN 2023 and Beyond, our new medium-to-long-term
strategy formulated in 2021, with every employee engaged in
the social value creation process. Based on our unique
PEOPLE FIRST principle, we are committed to embracing a wide
variety of nationalities, races, ages, lifestyles, careers, andworking styles and creating a truly global organization withhighly diverse and talented professionals. I am convinced thatsuch an organization can lead social transformation throughinnovations in various fields.
Now, the question is being raised again: what is the purpose of
a company? Contribution to society through our core beauty
business is the very essence of Shiseido’s existence cultivatedsince its founding in 1872. We believe that beauty has thepower to inspire confidence and hope. Driven by our corporate
mission, BEAUTY INNOVATIONS FOR A BETTER WORLD, we willleverage this power of beauty and contribute to a sustainable
world where everyone can enjoy a lifetime of happiness.

Top Message

Environment

Society

CultureGovernance

Sustainability Top Message
2020 was the year we encountered the threat of COVID-19. Questions wereraised about the sustainability of the world itself, which everyone until now
had taken for granted. In such circumstances, companies are expected todrive the promotion of sustainability actions.

emissions, palm oil, paper, water, and waste. We are currently tacklingother issues such as marine debris, which is a source of environmental andecological pollution. In terms of reducing the amount of plastic we use, we
aim to make all our product containers 100% sustainable by 2025.

In January 2020, we established the Sustainability Committee, a dedicatedbody to ensure detailed discussion and timely management decisions
concerning sustainability issues. The committee reviews and approves activity
plans based on sustainability strategies for the environment, society, andculture, and monitors progress.

In the area of society, we promote the activities of 30% Club Japan, aiming
to solve gender issues in Japanese society through our experience indiversity and inclusion management, with a focus on the activities of female
employees. In addition, we are working to create social value that is linked toour core business by sharing our makeup expertise through the LAVENDER
RING project, which supports people who are living with cancer. These efforts
have been well received both in Japan and overseas, and we are striving for
further progress in social contribution.

In July of the same year, we published our first global Sustainability Report. By
disclosing our medium-to-long-term targets and progress of our sustainability
actions through our core business, we have accelerated direct dialogue withinvestors and analysts, which has become a driving force for further efforts.
The concept of sustainability must be ingrained in every employee; wemust embody principles and behaviors that coexist with society and theenvironment in all of our activities. Therefore, we encourage our employees
to voluntarily engage in social contribution.
In the area of the environment, in response to climate change risk, a nonfinancial aspect of high stakeholders’ expectations, we have disclosed
management risks in accordance with the global framework of the Task Forceon Climate-related Financial Disclosures (TCFD) recommendations, which
we endorsed in 2019. We have analyzed risks and opportunities associatedwith the transition to a carbon-free society, as well as those posed by drasticchanges in the natural environment, and disclosed them in our Sustainability
Report. Regarding the reduction of related environmental impacts, we haveset and announced medium-term targets for five items: carbon dioxide

In the area of culture, we are taking advantage of the accelerated digital
shift to actively communicate our heritage to employees around the world
at a time when unity is threatened by isolation and other factors amid the
COVID-19 outbreak. This has brought shared value and a sense of unity toemployees with diverse backgrounds. The activities of the Shiseido Gallery in2020 were also highly praised for taking on the challenge of creating social
value through art.
The impact of COVID-19 has compelled us to reaffirm our purpose. As
we also return to our roots — bringing health and happiness to people
everywhere through the power of beauty — we are placing sustainability at
the core of our corporate strategy and integrating our business activities withenvironment, society, culture, and governance (ESCG) management. By doing
so, we will formulate and implement sustainability actions with a long-termview toward 2030.

Jun Aoki
Executive Officer,
Chief Social Value
Creation Officer

Annex

4

Top Message

Environment

Sustainability Strategy
Strategy Outline
We are placing sustainability at the core of our management
objectives for 2030, integrating our business and sustainability
strategies. To achieve our 2030 goal of contributing to“a sustainable world where everyone can enjoy a lifetime ofhappiness through the power of beauty,” we have establisheda new framework based on three pillars: For People,
For Society, and For the Planet.
For People: Support 200 million people throughhealthy beauty for a unique lifetime
Shiseido will provide consumers with healthy beauty throughour core businesses, via innovations leveraging the power ofbeauty and commitment to creating new value, helping eachindividual realize a lifetime of unique and healthy beauty.
For Society: Realize a society filled with respect andempowerment through the power of beauty
Shiseido embraces diversity in beauty to inspire people aroundthe world. By celebrating its many values, we aim to realize
a society where people accept and respect each other as
individuals, regardless of backgrounds or differences.
For the Planet: Contribute to an environment where people
can live in harmony and enjoy sustainable beauty
Shiseido strives for a rich natural environment where
people can enjoy sustainable beauty, now and in the future— throughout our businesses and the entire value chain,from raw material procurement, product development, andmanufacturing to use by consumers and product recycling
or utilization.
Shiseido’s Material Issues
In April 2019, we defined the Shiseido Group’s material issues
as a framework for creating social value unique to a beauty
company, based on interviews and discussions with our
stakeholders. We categorized the issues considering theirimpact on all our stakeholders (consumers, business partners,
employees, shareholders, society, and the Earth) as well ason the Company’s businesses, established an orderof priority, and selected 18 material issues. In addition, we
revised our definition of social value from the perspectives ofthe environment, society, culture, and governance (ESCG).
The details and positioning of each issue were reviewed throughdiscussions by Executive Officers and Audit & Supervisory Board
Members at the meetings of the Sustainability Committee,
established in 2020, followed by appropriate actions.
Read more

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Shiseido’s Key Strategic
Actions with SDGs

The following are our eight key strategic actions based on our material
issues. They correspond to the Sustainable Development Goals (SDGs)
indicated after each action.
Environment
Reducing Our Environmental Footprint: 6, 11, 12, 13, 14
Developing Sustainable Products: 3, 9, 12, 14
Promoting Sustainable and Responsible Procurement: 8, 12, 15

Society
Advancing Gender Equality: 5, 10
Empowering People Through the Power of Beauty: 3, 5, 10
Promoting Respect for Human Rights: 8, 10

CultureDrawing on Our Heritage and Culture to Imagine a Better Future: 4, 5, 10, 16
Inspiring the World with Our Sense of Beauty: 10, 16

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Environment
COMMITMENT 1

Reducing Our
Environmental Footprint
Read more

COMMITMENT 2

Developing Sustainable
Products
Read more

COMMITMENT 3

Promoting Sustainable andResponsible Procurement
Read more

Striving for the ideal ofa global environment that
supports lives of vibrancy

6

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‘Shiseido’ comes from a phrase in the Chinese classical text, I Ching: ‘Praise the virtuesof the Earth, which nurtures new life and brings forth significant values.’ Respect for theplanet, society and people has been embedded in our culture since our foundation in 1872.
In everything we do — from development and procurement to production — we work topreserve the global environment that we all depend on. That is how we create sustainablevalue. In this chapter, we report on the strategic actions we have taken to contribute to thehealth of our planet.

1

At all our sites.

2For all our sites, intensity per sales, compared with 2014.

3

For owned factories.

4

For sale of products with plastic packaging.

5

Physical supply chain options, identity preserved, segregated, and/or mass balance.

6Such as certified paper, recycled paper.

COMMITMENT 1

COMMITMENT 2

COMMITMENT 3

Reducing Our Environmental
Footprint

Developing Sustainable
Products

Promoting Sustainable andResponsible Procurement

We are reducing the environmental footprintof our activities by taking actions in three
key areas:

We use innovation to minimize the environmental
impact of our products. We also disclose ourpolicies on product development:

We procure materials based on our codesand principles:CO2
We will be carbon neutral by 20261.
Water
We will reduce our water consumption by
40% by 20262.
Waste
We will send zero waste to landfills by 20223.

PackagingComplying with Shiseido’s 5Rs (Respect, Reduce,
Reuse, Recycle, and Replace), we will achieve 100%
sustainable packaging by 20254.
Formula/Ingredients
We improve our environmental and social profile byusing sustainably sourced materials and ingredientsthat are selected for their safety andenvironmental properties.

Sustainable Procurement
Palm oil: We will achieve 100% sustainable palm oil5
usage by 2026.
Paper: We will achieve 100% sustainable paper6 usage
for product packaging by 2023.
Supplier Assessment
We work to ensure supplier traceability by conducting
supplier assessments and audits annually. We aim
to improve labor conditions, address issues and takeaction regarding human rights and the environment.

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COMMITMENT 1

Reducing Our Environmental
Footprint
12% CO2 reduction in 2020
(compared with 2019)

Across all areas of our business and value chains, we are promoting
initiatives that reduce the environmental impact of our activities, suchas reducing carbon dioxide (CO2) emissions and ensuring thesustainable use of resources.
The impact of climate change is becoming more apparent around theworld. It is important that companies make strong sustainability
commitments and take actions toward solving environmental issues.
We fully understand and support the “1.5°C scenario”1. Last year we
disclosed our medium-to-long-term targets for the reduction of CO2
emissions — which account for the majority of greenhouse gas (GHG)
emissions — as well as the reduction of water consumption and waste.
1

The 1.5°C scenario refers to the long-term temperature goal to hold global warming to 1.5°C above preindustrial levels.

16% water-consumption reduction in 2020
(compared with 2014)

CarbonNeutral by
2026

40%

Water-consumption
reductionby 2026

Zero landfill at all Shiseido factories in 2020

Zerolandfillby 2022

Zero landfill in 20208

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Reducing CO2
Emissions
Solar panels at the
Kakegawa factory (Japan)

At Shiseido, we have been focused on the issue of global warming
for a long time. In 1990, we completely abolished chlorofluorocarbons (CFCs). In 1997, we published our environmental targets
for the first time — including the reduction of greenhouse gas(GHG) emissions. And in 2020, we announced our commitment
to achieving carbon neutrality1 by 2026.
By carefully reviewing and redesigning the manufacturing
process at both new and existing factories, we were able tostrengthen our efforts to accelerate the reduction of CO2
emissions, including by using renewable energy and improving
energy efficiency. As a result, CO2 emissions were reduced by
12% of total emissions in 2020 (compared to 2019).
Following the transfer and joint venture of our Personal Carebusiness, absolute emissions from the product life cycle will besignificantly decreased. In addition, we have introduced groupwide efforts to contribute to a carbon-free society by further

reducing CO2 emissions in such areas as procurement,
production, and use.
Renewable Energy
Switching from fossil-derived energy, which emits large
amounts of CO2, to renewable energy is one of our importantenvironmental initiatives.
We have been increasing the use of renewable energy at our
offices and factories, the latter of which are known for theirhigh power consumption. As a result, our combined ratio ofrenewable energy from hydropower and solar power increasedby 95% in 2020 (versus 2019). In total, renewable energy
accounts for 33% of electricity consumed at our sites.
In addition to our East Windsor factory (USA), our Nasu factory(Japan), which began operations in 2019, has replaced 100% of
its electricity with renewable energy.

Renewable energy is also used at our offices across three
European countries, while 100% of the electricity used at ourfacilities in Italy and the UK is derived from renewable sources.
Solar Power
Our solar power efforts continue to grow, with systems installedat factories and buildings worldwide. Since 2007, our EastWindsor factory (USA) has been equipped with a fixed-tilt solar
power system, while a solar-tracking solar power system wasinstalled in 2010. In addition, solar power systems are installedat such sites as the Liyuan Cosmetics Co., Ltd. factory (China),
the Kakegawa factory (Japan), and the Global Innovation
Center (Japan).
In Taiwan, solar panels have been installed at our Hsinchu
factory, generating electricity used also by the local community.
1

Scope 1 and 2 CO2 emissions.

12%
Total
reductionof CO2emissions9Top Message

Water PowerJapan experiences a lot of rainfall due to its geographicalconditions. However, the steep topography makes it difficult tocollect and use the water resource effectively because it quickly
flows out to sea. Therefore, dams have been used for flood
control and water collection, as well as for generating renewableenergy, for many years.
Four of our factories in Japan — Osaka, Kakegawa, Kuki, andNasu — are actively using renewable energy from CO2-freehydroelectric power. The Nasu factory uses the CO2-freeTochigi Furusato Electric program, which is supplied byhydroelectric power plants in Tochigi Prefecture, to achieve
100% renewable electricity.

Environment

In 2020, we introduced a new energy management system(EMS)2 at our Kakegawa factory (Japan). In order to reduce
wasteful power consumption, we have increased the numberof observation points for electricity usage to more than 400— allowing for a more detailed visualization of usage status.
By optimizing energy usage this way, we expect to reduce CO2

CultureGovernance

Annex

10

Shiseido sites around the world utilizing renewable energy

UK
France
Spain

Italy

China

Japan

Vietnam

To maximize the use of renewable energy in order to mitigate
climate change as much as possible, we also utilize power
generated by small-scale local power companies for the grid.
We strive to make our production activities more sustainable
on a local scale by collaborating with local communities.
Improving Energy Efficiency
We are working to reduce CO2 emissions by improving energy
efficiency at all of our factories. Efforts include introducing
high-efficiency equipment and switching to energy sources
with a lower environmental impact. So far, we have achieved
significant improvements in energy efficiency.

Societyemissions by approximately 7% of the total annual emissions
at our Kakegawa factory.

USA

33%

Electricity at oursites derived fromrenewable sources

In Japan and Hong Kong, we work with key business partners
to optimize delivery frequencies, increase truck utilization, andreduce operating vehicle numbers.

Going forward, we will install EMS at all our factories and aim
to increase our investment in equipment as well as introduce
more initiatives to improve energy efficiency, all of which willfurther reduce the environmental impact of the entire
Shiseido Group.

For sea transportation in Japan and the USA, we have improved
container utilization, and reduced the number of operating
containers and shipments by consolidating cargo andoptimizing loading efficiency.

CO2 Reduction During Transportation
We are promoting the reduction of CO2 emissions by increasing
the efficiency of transportation within and between regions.

In 2020, progress in transportation optimization has
contributed to 17% reduction in CO2 emissions from Japan’s
factories to distribution centers compared to 2019.

2A system that realizes efficient use of energy
such as energy saving and load leveling by
visualizing the energy usage status using
information and communication technology.

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Environment

Society

Assessing Climate Risks
and Opportunities
We recognizethat climatechange is
not only anenvironmental
issue, but
a real issue
that will affectour businessstrategies andfinancial plans

We recognize that climate change is not only an environmental
issue, but a real issue that will affect our business strategies
and financial plans over the medium to long term. As such,various factors related to climate change, such as regulations,natural disasters, and consumer perceptions must be
considered.
We strive to mitigate the climate-related risks which influenceboth our business and the wider society, and turn them into
opportunities. Therefore, in 2020, we disclosed our target ofachieving carbon neutrality by 2026 through the reduction of
the Scope 11 and Scope 22 CO2 emissions. We also committed
to accelerate our plans to analyze climate-related risks andopportunities, and integrate them into our group-wide actions.
Governance
The Shiseido Sustainability Committee discusses management
decisions concerning sustainability issues. The committee ischaired by a Representative Director and consists of executive
officers in charge of Corporate Strategy, Social Value Creation,
R&D, Supply Network, Corporate Communications, Brands,
and Corporate Auditors. In 2020, in addition to the Committee,
significant issues were discussed at the Executive Committee,
the Innovation Committee, and the Board of Directors for a
total of 12 meetings. At the Committee, medium-to-long-termtargets related to CO2 emissions, water, waste, packaging, andsustainable procurement of, for example, palm oil and paper,
were also discussed — to proactively tackle the environmental
issues related to these topics. As those targets impact our
corporate direction, they were raised with the Board of
Directors as well. Due to the importance of climate changerelated issues, the Board of Directors stressed that what wework to achieve should reflect our stakeholders’ expectations(consumers, business partners, employees, shareholders,society, and the Earth), and encouraged us to commit toambitious targets.
Strategy (Scenario Analysis)
We conducted our scenario analysis for both the transitional
and the physical risks/opportunities in terms of the 1.5/2°C
and 4°C scenarios, respectively, based on the Representative
Concentration Pathways (RCPs) and Shared Socioeconomic
Pathways (SSPs) provided by the Intergovernmental Panel on
Climate Change (IPCC).
Regarding risk analysis, in the 1.5/2°C scenario, the elements
associated with the transition to a decarbonized society —such as policy, regulation, technology, market, and consumer
perceptions — were considered. In the 4°C scenario, which
includes no proactive measures against climate change, theCultureGovernance

Annex

11

physical factors related to the acute or chronic phenomena
caused by the rise in temperature were analyzed — such as,
for example, floods and water shortages.
As for the opportunities, in the 1.5/2°C scenario, highawareness by consumers means there is a market forsustainable brands and products. Similarly, the 4°C scenario
identifies sales opportunities for products that can help
people to live with high temperatures. At Shiseido, we aim toleverage these findings — by mitigating risks and by making themost of the opportunities to provide sustainable products to
consumers and promote our beauty innovations.
We identified carbon taxes, changes in the market andconsumer perceptions, floods, and water shortages as theinfluential risk factors, and quantified their financial impacts
in 2030.
Risk Management
In 2020, we assessed and identified the impactful risks by aholistic approach. “Natural and Human-Made Disasters”, and“ESC (Environment, Society, and Culture)” are listed as thecategories related to sustainability.
Climate-related risks are analyzed based on scientific andsocio-economic evidence and integrated into the enterpriserisk management system as one of the elements related tonatural disasters or ESC. The Group’s risks assessment andcountermeasures are also periodically reviewed by the Global
Risk Management & Compliance Committee, headed by theGroup CEO and composed of regional CEOs and executive
officers as well as the Executive Committee.
1 S cope 1 relates to the CO2 emissions generated from fuel consumption in our sites.
2 S cope 2 relates to the CO2 emissions generated from energy consumption by 3rd parties
such as grid power.

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Metrics and Targets
In order to mitigate the physical risks, we use the ratio of
our CO2 emissions as the standard metric. Physical risks aretracked and monitored every year. In particular, we set thetarget to achieve carbon-neutral operations by 2026 for Scope
1 and Scope 2 emissions. In terms of mitigating market risks
and creating opportunities in the 1.5/2°C scenario, we support
the concept of a circular economy, and aim to reduce CO2
emissions and eliminate single-use plastics with the target ofswitching to 100% sustainable packaging by 2025. To manage
the risk of water shortage in the 4°C scenario, we selectedwater consumption at our sites as an indicator and set a targetof reducing it by 40% by 2026. As for other physical risks,
we will examine appropriate metrics from the viewpointof long-term risk management.
Roadmap for Disclosure
In April 2019, we announced our support for the Task Forceon Climate-related Financial Disclosures (TCFD) and started
disclosing the results of climate-related risk analysis based on
the TCFD framework. In addition to the results of the qualitative
analysis of risks and opportunities which we disclosed in 2020,
we also released our quantitative risk analysis and identified
major areas where we will take action.
We will make dedicated efforts to mitigate risks by planning
actions in cooperation with our businesses, and integratingthem into our management and business strategies.
In addition, we will disclose initiatives that lead to newopportunities as well as risk mitigation through our value
chain. At the same time, we will also improve our analysis
based on the latest scientific evidence.

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Risks and Opportunities Identified by the Scenario Analysis
Risks

Opportunities– Carbon tax increase– Fuel price increase– Tighter regulations/requirements– Improve energy efficiency– Boost consumer awareness of, and demand for, sustainable
and ethical products

Acute– Natural disasters stop operations (e.g. typhoons, floods)– Natural disasters disrupt logistics

Chronic– Changes in rainfall conditions impact the cost of procuring
raw materials derived from crops– Water shortages stop operations­­– Increase expectation for environment-friendly products(e.g. dry shampoo and conditioner)– Increase in consumer demand for products that correspondto high temperatures

Transition(Seen mainly in the
1.5/2°C scenario)

Physical(Seen mainly inthe 4°C scenario)

Risk factor analyzed qualitatively and quantitatively

Risks and Opportunities by Scenarios
FactorTransition(Seen mainly in the
1.5/2°C scenario)

Natural Phenomena

Impact on Society

Impact on ShiseidoCountermeasure

Mitigation measure

Carbon tax

Cost increase

Consumers’ awarenessMarket needs

Opportunity/ loss of sales– Improve energy efficiency– Shift to renewable energy– Develop ethical brand/
product

Regulations

Physical(Seen mainly inthe 4°C scenario)

Temperature rise

Rainfall increase (poor sunlight)

Destabilization of agriculture

Cost increase

Rainfall decrease

Competition for water resource

Operation stop

Flood
Population increase

Risks and Opportunities, Countermeasures by Scenarios Read more

Facility damage
Logistics disruption– Seek alternative
crop/material– Introduce water saving/reclaiming facility– Develop BusinessContinuity Plan(BCP)– Identify vulnerable site
– Disaster preparedness
drills12

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Reducing Water
Consumption
Quality water allows us to produce quality products. It supports
every aspect of our cosmetics business, including the developmentof water-containing products such as lotions; the growth ofplants as raw materials; temperature control; and equipment
cleaning at production sites. Post-production, water is essential
for rinsing during hair and face washing. It also plays a key rolein the disposal and recycling process.
In early 2020, we set a target of reducing our group-wide water
consumption by 40%1 by 2026. In order to achieve this target
and ensure sustainable use of water, we are proceeding withefforts based on careful analysis of water consumption.
At factories, which consume a large amount of water, we havebeen engaged in water-saving activities since the start ofoperations. This involves the use of automatic cleaning equipment at manufacturing facilities, and setting up equipmentcleaning locations for efficient water use.
We are also introducing water reclamation equipment at ourfactories that enables water to be recycled and reused.
As a result of our ongoing efforts, water consumption was
reduced by 16% in 2020 (compared to 2014).

Water Saving Initiatives
We are working to reduce water consumption at all our
factories. At our Osaka factory (Japan), we reconsidered existingcooling methods and remodeled certain equipment. By introducing a circulation-type system that can recycle used water,
we reduced water consumption by 8% per year. At our Kuki
factory (Japan), we have introduced a water-saving washer
for cleaning tanks and drums used for cosmetics storage andtransportation. The machine uses a flexible nozzle and automatic
controls, while cleaning patterns can be optimized according toresidue and container type. This allows for 90% water reduction
per cleaning. At the same factory, we have also developed a
new cleaning agent for sunscreen products that are difficult toremove from storage tanks and manufacturing equipment. The
new cleaning agent ensures a reduction in both cleaning times
and water consumption.
Finally, at our Gien factory (France), we switched from waterto alcohol for cleaning our fragrance product manufacturing
equipment and resin skids. All alcohol used in the process isrecycled. This has enabled us to use water more efficiently,
leading to an 81% reduction in water consumption at thisfactory compared to 2009.

Water-saving equipment
at the Nasu factory (Japan)

Groundwater
Water is a shared resource, jointly managed by various stakeholders at different stages of the river basin. In collaboration
with local stakeholders, we promote “water stewardship”2 asa common property through drainage methods andsecondary use.
We use the abundant, high-quality groundwater for manufacturing processes and as a raw material for cosmetics. At our
Nasu factory (Japan), we are working to recycle groundwaterby supplying clean, treated wastewater to local agriculture.

1

Intensity per sales, compared to consumption in 2014.

2

U sing water in a way that is socially equitable, environmentally sustainable,
and economically beneficial.

16%
Water reduction(intensity per
sales) comparedwith 2014

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Reducing Waste
While waste management and processing methods differ bycountry or region, the culture of effectively recycling or reusing
resources has been nurtured at all Shiseido factories. We havebeen working on recycling and reusing waste for many years,
promoting thorough waste management with careful sorting ofmaterials before disposal.

Waste Reduction at Factories
We achieved zero emissions1 at our domestic factories in 2003,
and zero landfill in all 12 factories worldwide in 2020. This wasmade possible by continuous recycling of resources and carefulseparation and collection of waste.
In our Osaka factory (Japan), we contribute to resource
circulation by using plastic compactors to convert waste
plastics into recyclable materials. At our Kuki factory (Japan),we changed the dehydration method to reduce the amount ofsludge discharged by wastewater treatment, switching from adrying method to a screw-pressing method that helps to saveenergy and reduce 250 tons of waste.

We also manage our stock effectively by improving ourestimations of demand and using excess stock.
Employee Training
In 2020, we held online seminars for all managers andemployees in charge of industrial waste in Japan. The aim was
to share knowledge and ensure understanding and compliancewith laws and regulations. A total of 164 employees attended
these seminars.
With the help of our original compliance checklist, eachparticipant can identify how to effectively manage waste. As
a result of these activities, there were no accidents or legal
violations associated with waste in 2020.

Zero landfill at
all 12 Shiseidoowned factories

1

Recycled waste: 99.5% or higher.

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15

COMMITMENT 2

Developing Sustainable
Products

Sustainable packaging accounted for 57% of all
Shiseido packaging developed in Japan in 2020
1,200 SKUs of refills available globally

Sustainable
Packagingby 2025“Let the product speak for itself.” These words from Shiseido’s founderand first president are reflected in our corporate mission and productdevelopment goals. We believe our products can convey the message
that we aim to work sustainably, such as how we procure raw materials,
and our commitment to reducing, reusing, and recycling. We aim toprovide consumers with products that demonstrate our sustainability
beliefs, from the moment of purchase, upon every use, and at disposal
or reuse. In addition, through design and usability, our products also
communicate the “art and science” aspect of our DNA.
Based on the unique Japanese spirit of Mottainai1, we strive to minimize
the use of natural resources and promote activities that allow for reuse.
In consideration of the environment, we have also been cultivating
formulas and ingredients that comply with high safety and quality
standards. By living in harmony with the planet, we can contribute to
the realization of a more sustainable world.
1Mottainai: a Japanese word that expresses a sense of regret over waste, and is a call for gratitude and respect. It is also a concept usedby environmentalists to encourage people to reduce, reuse, and recycle.

Sustainable
Formula100%

Disclosed policies on product development in 2019
Safety and quality standards

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Sustainable
Packaging
Sustainable packaging plays a critical role in our efforts to
reduce our environmental footprint related to the reduction of
CO2 emissions and marine debris. In 2020, we introduced our
packaging development policy, “Shiseido’s 5Rs”1. To support theconcept of a circular economy, we also disclosed our mediumterm target: 100% Sustainable Packaging by 20252, whichmeans we aim to make our cosmetics’ plastic packaging either
reusable, recyclable, or biodegradable.
Sustainable packaging accounted for 57% of all Shiseido
packaging developed in Japan in 2020, a large portion of which
included refillable packaging that also allows for the reduction
and reuse of plastics, and mono-materials usage. In the same
year, other sustainable packaging achievements included
the development of packaging made from materials that
decompose in water, and the introduction of refill services atour stores.
Reduce and Reuse
Refillable products have been attracting a lot of attention inrecent years, especially for their role in reducing environmental
impact and minimizing plastic usage throughout the productlife cycle.

At Shiseido, refillable solutions have been part of our approachto product packaging for a long time. Since launching our firstrefillable powder compact in 1926, we have introduced a rangeof refillable solutions to our skincare, makeup, and hair care
categories. In 2020, we offered refillable products for 1,200
stock keeping units (SKUs) under 53 brands globally. At ELIXIR— one of our key global brands — consumers’ choice in favorof refills resulted in an 83% reduction of plastics comparedwith the use of regular (primary) packaging. For example, weestimated that the use of refills for ELIXIR lotions and emulsions
in Japan reduced our carbon footprint by 56%, based on theLife Cycle Assessment methodology. In 2021, we will continue
to expand our refillable solutions to other regions.
We also believe in sharing the importance of sustainability withour consumers. By opting for refillable solutions, they are able
to contribute to reducing the environmental footprint of theirproduct consumption, while acquiring personal beauty andeconomic benefits.
For cosmetics, packaging design and usability are importantvalues. While leveraging almost 150 years of knowledge,
we strive to accelerate innovation, considering materials,

composition, processes, and business models from a circular
economy perspective. By offering innovative packaging such as
convenient, refillable products, we aim to turn commitment into
action, communicating the importance of sustainability to ourconsumers around the world.
Initiatives for Reuse
To make more effective use of limited resources and minimize
environmental impact, SHISEIDO introduced a new refilling
service at its global flagship store in Japan. The service, called
the Ultimune Fountain, encourages consumers to bringused packaging to the store for cleaning and refilling. We
succeeded in introducing the service thanks to meticulous
hygiene management compliant with the strict Japanese safety
and quality standards related to refilling — especially forcosmetics due to their complicated content composition andlong-term use.

1In order to reduce our environmental footprint and support the concept of a circular economy,
Shiseido defined 5Rs : Respect, Reduce, Reuse, Recycle, Replace.

2

For sale of products with plastic packaging.

From left: Body and refill
for ELIXIR Superieur lifting
moisture lotion, ELIXIRSuperieur enriched cream,and SHISEIDO Ultimune
Power Infusing Concentrate

In 2020, weoffered refillable
packaging for
1,200 SKUs
under 53 brands
globally

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Environment

In-store Collection and Recycling
To support recycling, Shiseido and its brands work closely with
consumers, waste suppliers, and other related parties.

SHISEIDO AquaGel Lip Palette,the world’s first Green Planet™ cosmetics packaging

Looking ahead, we will use our knowledge and experience inreusing packaging to inspire further innovations. In addition, we
join the reusable packaging program, Loop3 in Japan in 2021.
RecycleTo realize a circular economy, it is important to select materials
and design products that can be reused and recycled.

In our stores, we have been promoting in-store collection andrecycling of used packaging. For example, bareMinerals started
a packaging collection program — the bareMinerals “Give Back,
Get Back” Recycling Program — in the USA in 2018, allowing
consumers to return packaging from used makeup andskincare products, regardless of brand, to bareMinerals stores.
When they return packaging, consumers are rewarded withmember points that can be used on the brand’s website orin-store. Funds generated by the program are donated to
the g2 revolution® Feed the Future initiative, which supports
community hunger-reduction activities. So far, we havecollected approximately two tons of plastic, some of which
was recycled to create makeup bags released during the 2020holiday season.

In order to reduce the number of single-use plastics, wedevelop mono-material packaging and packaging that can beeasily disassembled and recycled after use. In 2020, 25% of the
products developed at the Shiseido Global Innovation Centerin Japan featured either mono-material or easy-to-disassemble
designs. The majority of these were products with large sales
volumes, such as SENKA face wash and TSUBAKI shampoo
and conditioner.

In 2021, as part of THE POWER OF GOOD initiatives,
bareMinerals also began recycling activities in Japan. This
included a donation program, a recycling program where wecollected used packaging in-store, and a promotion where wesold eco bags and gave consumers points if they used theirown bag. Similarly, SHISEIDO Professional introduced initiatives
to collect used cosmetics and hair product packaging fromsalon customers at Shiseido Beauty Salons before recycling
it to create resources.

Drunk Elephant, a brand rooted in “clean beauty”, aims toaccelerate packaging recyclability, and use only recyclable
materials by the end of 2021. Such initiatives are also being
pursued by our other brands. In addition, BAUM — our skincare
brand launched in 2020 — actively uses recycled glass in
its packaging.

Replace
At Shiseido, we are engaged in developing alternative plastics,
biomaterials with low environmental impact, and packaging
that biodegrades naturally. In 2020, SHISEIDO launched a new
type of sustainable packaging in collaboration with Japanesematerial manufacturer KANEKA. Composed of 100% KANEKA

Society

CultureGovernancebiodegradable polymer Green PlanetTM, the new material isunlike conventional biomass materials. It is biosynthesizedwithin the cells of microorganisms and can decompose in
freshwater or seawater. As with all new materials, there arechallenges to overcome — such as moldability and stability —but we believe this innovation is one possible solution to the
problem of marine plastic waste.
Since 2011, we have also expanded the use of sugarcanederived polyethylene as a packaging material for some of ourbrands, including hair care brand TSUBAKI, suncare brand
ANESSA, skincare brand ELIXIR and men’s brand UNO — all of whichboast high sales volumes. Sugarcane-derived polyethylene ismade from molasses after the sugar has been refined. It is viewed
as a cleaner alternative to petroleum-derived polyethylene, as its
fibers can be used as fuel in the manufacturing process. Its usage
contributes significantly to reducing CO2 emissions.

bareMinerals
Give Back Get
Back Recycling
Program in store

Annex

3

Loop is a circular shopping platform
created by Terracycle (USA) that replaces
single-use disposable packaging withdurable, reusable packaging. Loop iscurrently available in the UK, France,
Canada and the USA, and is scheduled
to launch in Japan in 2021.

The Ultimune Fountain at
SHISEIDO’s global flagship
store

17

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Sustainable Formula
We are committed to developing products and services that aresafe and meet high quality standards. We aim to achieve this byusing over a century’s worth of extensive research and resultsfrom dermatological and material science — combined with thelatest formulation technologies. Currently, we are conducting
research and development at seven innovation centers aroundthe world.
Naturally derived raw materials are widely used in cosmetics
products. From an environmental perspective, their sustainable
and responsible procurement and use are of the utmost
importance. Our Global Innovation Center (Yokohama, Japan),which manages all regional centers, compiled a list of all
ingredients used in our products to provide clarity from asustainability perspective.
When selecting raw materials and ingredients, we strive toprioritize human safety, reduce our environmental footprint,
and carefully consider ethics. Through our technologies andpatents, we contribute to both the planet and society.
UV CareAs a result of climate change, the amount of UV radiation has
been increasing1. UV exposure for people around the world isalso expected to increase.
Exposure to UV rays over extended periods of time causes
spots and wrinkles on skin, referred to as photoaging.
Fortunately, cosmetics nowadays offer a variety of ways toprotect against UV. However, while UV protection is essential

to human health, it has been shown that some components in
UV protective products may have an adverse effect on marine
ecosystems such as coral.
In response to this, we have been developing sunscreen that
protects skin without negatively impacting the environment. In
2020, SHISEIDO released a new suncare product in the USA —Ultimate Sun Protector Lotion — which is free from ingredientsthat pose a risk of coral bleaching.
Actions Toward Consumer Needs
In recent years, we have seen how natural environments andcommunities suffer as a result of exploitation and unsustainable
activities. Consumers are reacting to this. More than everbefore, they are holding brands and companies accountable
when it comes to showing social responsibility and taking realaction to reduce the environmental impact of their activities.
This includes the use of raw materials.
At Shiseido, we wish to give consumers and all otherstakeholders insight into how our products are produced.
Therefore, we issued our sustainable product development
policy, which reflects impact to human safety, environmental
considerations and ethics. We also exercise transparency interms of corporate product development directions for eachof our brands.
Clean beauty is important to us, and we respond to consumers’sustainability needs with brands such as bareMinerals, Drunk
Elephant, and BAUM — which was established in 2020 aroundthe theme “coexistence with trees” and uses upcycled oak, bioPET
plastics and recycled glass for its packaging, and is an advocate
of product refills. These brands strive to satisfy consumer needs
through sustainability actions such as raw material procurement,
ingredients usage, and packaging.
Licensing of Environmental Technologies
In an attempt to solve environmental and social issues, thepractice of licensing owned and patented technologies has
become increasingly popular in recent years. Rather thanmonopolizing environment-related technology, companies arelooking to one another for shared solutions.

SHISEIDO Ultimate
Sun Protector Lotion

In 2020, we were the first cosmetics company to join WIPO GREEN2,
an international technology exchange platform established by theWorld Intellectual Property Organization (WIPO), and have sinceregistered several environment-friendly technologies in the WIPO
GREEN database. Notably, these include technologies that achieveboth excellent cleaning and water conservation during rinsing,which can be applied mainly to cleansing and hair care products,
as well as technologies that concentrate and reduce energy
consumption for manufacturing and transportation. We believe
such technologies can contribute to tackling environmental issues
such as drought and CO2 emissions.
Animal Testing Read more
1

JAMSTEC (Japan Agency for Marine-Earth Science and Technology) research results indicate that climate change influences atmospheric circulation(Hadley circulation) and increases the total amount of UV ray exposure in the middle latitudes.

2W IPO GREEN was established by WIPO in 2013 as an international framework to promote innovation and diffusion of environment-related technologies.
It has gained the participation of more than 100 corporations around the world.

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COMMITMENT 3

Promoting Sustainable
and Responsible
Procurement
It is no secret that the world’s natural resources are limited. At Shiseido,
we place the utmost importance on the responsible procurement of raw
materials and the reduction and reuse of resources. We operate from theperspective of a circular economy, and view environmental conservation
and biodiversity as the key to a more sustainable world.
In all our activities, from procurement to production, we also seek ways
to strengthen our response to human rights issues. Sustainable andresponsible procurement requires close collaboration with all of ourpartner companies and suppliers. In 2020, we disclosed our mediumterm target for the procurement of raw materials (palm oil and paper)in consideration of both the environment — such as forest conservation— and human rights. In addition, we expanded our supplier assessment
program globally and made efforts to resolve existing issues.
Shiseido Group Supplier Code Of Conduct
Shiseido Group Procurement Policy
Shiseido Group Sustainable Raw Materials Procurement Guidelines

Created a roadmap toward 2026, anddeveloped an implementation scheme

100%

Acquired RSPO Supply Chain Certification
System (SCCS) at all our factories

64% shift to sustainable paper

Sustainable Palm
Oil by 2026

100%
Sustainable
Paper by 2023

Expanded our supplier assessment
program globally
Assessed 791 suppliers (356 in 2019)

Supplier
Assessment

19

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Sustainable
Procurement of
Raw Materials
Oil palm fruits

The production of raw materials can result in environmental
destruction and human rights violations. Raw materials suchas palm oil and paper pulp have a large impact on biodiversity,
therefore it is important for companies to procure materials
that are produced under sustainable conditions.
In 2020, we published our medium-term targets for thesustainable procurement of palm oil and paper, and we are in
the process of switching to more sustainable raw materials. We
are also strengthening our efforts to solve issues related to mica.
By clarifying our own procurement policy and building a
support system in collaboration with other companies, we
aim to make a positive change.
Biodiversity
The planet’s ecosystems are the basis of our lives andindustries. They support the economy with food production,water sources, and tourism, and are also a source of bioactive

substances and biomimicry, which can be used to create
new beauty products. We rely on natural resources for the
production of cosmetics, and we aim to sustain harmony withnature, using approaches based on sustainability. We believethat materials that have fulfilled their role in products should
be returned to the Earth in a harmless manner.
In addition to our values of quality, safety, and efficacy, we takea holistic approach by anticipating possible issues in our entire
global supply chain. We believe it is important to anticipatechanges that can affect the environment and society to realize
our value of sustainability.
Preserving the Earth’s biodiversity is critical. Rainforests area treasure trove of biodiversity and must be protected fromunsustainable wood pulp and palm oil procurement. We are
pursuing initiatives to ensure the future of ecosystems and areworking to mitigate climate change by minimizing the releaseof carbon accumulated in rainforests into the atmosphere.

Palm Oil
Palm oil is a highly versatile raw material used in a variety
of products, from food to cosmetics. Consumption has been
increasing year by year, and it is considered to be one of
the main causes of rainforest destruction in Asia. As wellas environmental issues, such as forest conservation andbiodiversity, there are also human rights issues associatedwith palm oil production areas. Therefore, sustainable andresponsible procurement is essential.
As part of our efforts in this area, in 2010, we joined the
RSPO (Roundtable on Sustainable Palm Oil), an international
non-profit organization. In order to support the sustainableproduction of palm oil in 2018, we began purchasing RSPO
certificates (credits) equivalent to 100% of palm-derived raw
materials. And in 2020, we disclosed our medium-term targetof reaching 100% sustainable palm oil by 2026.

4-0103-10-100-00

Top Message

FSC-certified ELIXIR
packagingTo make the switch to RSPO-certified sustainable palm oil,the relevant teams in our global and regional headquarters
worked together to compile a list of all targeted raw
materials, created a roadmap toward 2026, and developed an
implementation scheme. We also collaborated with suppliers
regarding the timing of the switch to certified palm oil content
in raw materials. We then began the implementation scheme,
moving away from raw materials with a high palm oil content tocertified raw materials based on RSPO’s physical supply chain
model.
In order to use these certified raw materials, we acquired RSPO
Supply Chain Certification System (SCCS) at all of our factories.
We also asked our suppliers to acquire the certification as theyhandle certified raw materials.
Since 2019, we have been part of the Japan Sustainable Palm
Oil Network (JaSPON) and the palm oil working group of theConsumer Goods Forum (CGF), an international industry
group consisting of food and consumer goods manufacturers
and retailers, in order to solve issues relating to palm oil bystrengthening collaboration with other companies.
Through these activities, we will contribute to the promotion ofsustainable palm oil procurement and consumption, and to theresolution of environmental and social issues related to palm oil.
Paper
We actively promote the use of paper for secondary packaging,such as boxes, aiming to responsibly use resources and reduce
single-use plastics.
In 2020, approximately 90% of the cartons we used were madeof paper. We aim to be using 100% sustainable paper by 2023 —Environment

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21

not only for use in secondary packaging, but also
product packaging.

and more than 50% of malnourished children received
adequate nutrition.

We also promoted the switch to environment-friendly paperin 2020, developing a new base paper, which resulted in
a 64% (weight) shift to sustainable paper.

Our participation in RMI initiatives focused on two areas:
Traceability and Workplace Standards, supporting activities
aimed at improving the traceability of the mica supply chain in
India, and improving working conditions — including the issueof child labor.

Cosmetics packaging must satisfy various expectations. It
must be strong, environment-friendly, and sophisticated indesign. In collaboration with paper manufacturers, we aredeveloping innovative paper packaging solutions that meetsuch expectations and even go beyond. We are also promoting
the switch to sustainable paper for promotional materials suchas product displays, bags, and leaflets, as well as copy paperin our offices.
Mica
Mica is used not only in beauty, but across a wide range ofindustries due to its light-reflecting properties and excellent
heat resistance.
In 2017, we joined the Responsible Mica Initiative (RMI), which
ensures sustainable mica procurement. RMI works withparticipating companies from a variety of industries to eliminate
child labor and forced labor at Indian mica mining sites, and toestablish Indian mica as a sustainably produced raw material
by 2022.
In 2020, in collaboration with NGOs and the Indian
Government, RMI contributed to the improvement of income
sources for 1,166 households across 80 villages throughalternative employment, such as agriculture and livestock.
More than 44% of children who were previously unable toattend educational establishments found regular schooling,

Mica

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Responsible Procurement
Our aim is to create a sustainable supply chain built on
responsible procurement. To do so, we are gradually
expanding our supplier assessment programs across all
regions and categories.
As our first step, we aim to eliminate high-risk suppliers,
and we are conducting assessments with priority given to
critical suppliers. If suppliers are identified as high-risk, we
communicate with them to agree on improvement plans. In
addition, key performance indicators (KPIs) and targets arereviewed as the number of our suppliers grows.
In 2020, the geographical scope of our supplier assessment
program increased, with the target regions growing beyond Japanand EMEA to the rest of the world. In the procurement category,the scope of the assessment was expanded to include production
materials, sales tools, and production outsourcing. We conductedassessments on these suppliers using the same tools across all
regions, and took definitive action to resolve any issues.
Supplier Assessment and Monitoring
In addition to annual supplier assessments from theperspective of sustainability (human rights, occupational healthand safety, environment, and business ethics) using Sedex(Supplier Ethical Data Exchange), EcoVadis, and our originalSelf-Assessment Questionnaire (SAQ), we also confirm
compliance with the Shiseido Supplier Code of Conduct.
Based on these assessments, we classify suppliers into fourgroups: low-risk, medium-risk, high-risk, and non-assessable

due to insufficient response. Any suppliers deemed high-risk
are requested to implement corrective action plans. We also
conduct visits and third-party audits based on the magnitudeof risk and the importance of the supplier. We strive to reduce
the number of high-risk suppliers by investigating the risks andissues identified during assessment and closely monitoring
their corrective actions that follow.
Supplier Assessment
In 2020, we expanded our supplier assessment program
globally. In the procurement category, we assessed 791
first-tier suppliers (compared with 356 in 2019).
We classified 132 suppliers as high-risk. The major risks
identified included ‘failure to implement evacuation drills’and ‘failure to implement patrols by the Occupational Safety
Committee.’ We provided feedback to all high-risk suppliers
through visits or online, to explain the sustainability issues that
required corrective actions. In addition, audits were conducted
on 22 suppliers. Most were critical suppliers with risks.
As a result of the corrective actions we requested throughfeedback and audits, 30 suppliers improved from high-risk
to medium-risk or lower within 12 months. In addition,
15 second-tier critical suppliers were evaluated, and noneof them were deemed high-risk.
To support our suppliers, we hold an annual Supplier’s Day
to share purchasing strategies with them. Our procurement

department in Japan uses this opportunity to promote our
procurement policy — including our requirements for raw
materials, packaging, and indirect materials — as well as
respond to their questions and requests.
Reporting and Consultation Center for Suppliers
Protecting human rights, and compliance with laws that protect
people’s rights, are critical to everyone. In 2013, we set up
the Business Partner Hotline to deepen our understandingof human rights compliance at our suppliers; promote fairtransactions; and nurture a culture of transparency. When weare made aware of a compliance violation, either by email orother documents, we deal with it appropriately and rapidly.
In 2020, there were no reports of non-compliance.
CDP Supplier Engagement Rating
We have been highly praised for our efforts to manage
greenhouse gas (GHG) emissions and reduce risks throughout
the supply chain by CDP, an international environmental NGO.
In 2020, we were selected for the Supplier Engagement
Leaderboard for coming out at the top of CDP’s Supplier
Engagement Rating.
Going forward, in collaboration with our suppliers, we willcontinue to promote activities that help reduce ourenvironmental footprint.

Annex

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Society
COMMITMENT 1

Advancing Gender Equality
Read more

COMMITMENT 2

Empowering People Throughthe Power of Beauty
Read more

COMMITMENT 3

Promoting Respect for
Human Rights
Read more

Advancing a societythat embraces diversity
through respect, andsupports lives of beauty

23Top Message

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Since our establishment in 1872, we have offered products and services to enrich
the lives of people everywhere, responding to everchanging social values and thediverse needs of humanity.
The COVID-19 pandemic has had an unprecedented effect on society and has forced
many people to question their beliefs and re-examine the way they live. In particular,
it has had significant consequences for groups who were already exposed, such as
highly vulnerable women.
Going forward, we strive to promote a broader range of social values. By offeringvarious avenues of education, we aim to move away from monoculture, stereotypes,
prejudice, and discrimination to nurture a society of diversity and inclusion.

COMMITMENT 1

COMMITMENT 2

COMMITMENT 3

Advancing Gender Equality

Empowering People Throughthe Power of Beauty

Promoting Respect for
Human Rights

24

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COMMITMENT 1

Advancing
Gender Equality

Women in leader­ship
positions across ourglobal organization

57.5%

Women onthe board

46.2%
We strive to realize a society that empowers everyone — regardless ofgender — to live life exactly as they wish. It is our mission to solve social
issues that affect women. For more than 100 years, we have not only
supported and inspired women around the world through our products
and services; we have also worked to increase their visibility and elevatetheir role in society.
In 1934, we challenged conventions and welcomed women into theworkplace in Japan, creating the specialized role of Miss Shiseido— the predecessor of today’s Beauty Consultants. Then, in the 1990s,
we introduced efforts to help women keep working regardless of life
events, such as raising children. We have continued to support our female
employees ever since. Outside of Japan, we began hiring female Beauty
Consultants in Singapore in 1959, followed by Taiwan.
Building on our heritage of empowering women in Japan and aroundthe world, we also collaborate with organizations to give vulnerable
girls STEM (Science, Technology, Engineering, and Mathematics)
education opportunities.

Femaleleaders in Japan

34.7%
50% Goal
See more on Social Data

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Resolving the Gender Gap and
Empowering Women in Japan
We promote a variety of initiatives to solve gender issues andempower women in Japan. As a leading company in this field,
our efforts include:
Participation in the 30% Club JapanThe 30% Club, a global campaign to boost female
representation on company boards, launched in Japan in May
2019. Since its launch, Masahiko Uotani, President and CEO of
Shiseido, has served as Chair.
Under Mr. Uotani’s leadership — testifying his belief that
“Japanese companies must play a central role in promotingsocial change” — the 30% Club Japan established the “TOPIX
Presidents’ Committee”, a community of leaders from TOPIX
100 and TOPIX Mid 400 companies. The Committee works toachieve a 30% ratio of women in upper management roles at
TOPIX 100 companies in Japan by 2030.

The Shiseido Female
Researcher Science Grant
online award ceremony

By participating in the 30% Club Japan, we aim to increase
female representation on boards and in upper management,
and ultimately help resolve the gender gap in Japan — whichranked 120th in the Global Gender Gap Report 2021.

Supporting Female Researchers
We are working to increase the ratio of female researchersin Japan, which remains at a low level of 16.9% compared toWestern nations. To achieve this, we provide support for women
conducting world-leading research in the field of natural sciences.
In 2007, we established the Shiseido Female Researcher Science
Grant, which provides funding for 10 female researchers per
year. In 2020 — its 13th year of operation — the grant gave eachresearcher JPY 1 million. To date, we have contributed to theresearch achievements of 129 female researchers in Japan.
Childcare Support
We recognize the concerns many families face — balancing
work and childcare – particularly during the early child-raisingyears. To provide support during this time, we established two
in-office daycare nurseries: Kangaroom Shiodome (opened in2003) and Kangaroom Kakegawa (opened in 2017). As well as
providing support for our employees, we also offer places tofamilies who live or work nearby.
In 2017, we launched KODOMOLOGY Co., Ltd., which operates
Kangaroom Shiodome and Kangaroom Kakegawa, as well as

In-house daycare nursery“Kangaroom Kakegawa”

providing childcare services to other companies and theiremployees. And in 2020, we began supporting and managing
two childcare facilities at other companies in Kanagawa and
Shizuoka prefectures.

26

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A Message from Ann Cairns,
Global Chair of the 30% ClubThe 30% Club is a global gender diversity campaign that aims to achieve
gender balance in leadership across the world’s biggest companies.

When we started the 30% Club campaign in the UK in 2010,
there were just 12% women on the boards of the FTSE 100.
Today, the figure stands at 36%. This has been tremendous
progress in a little over a decade — but there remains muchwork to do to deliver parity.
It is encouraging to see the 30% Club Japan chapter is alreadymaking progress. When the chapter launched, there wasonly 7% female representation on the boards of TOPIX 100
companies, with an initial target of reaching 10% by 2020.
Congratulations to Mr. Uotani, the Chair of the 30% Club Japanand all its members for achieving 12.9% today.
Shiseido’s own commitment to diversity and inclusion isadmirable. The company is a very powerful example of what canreally be achieved across Japanese companies.
Its mission to make our world better for women and girls isdemonstrated throughout this excellent sustainability report.

Whether that’s by funding female research scientists; designingcosmetics for older women and cancer patients; supportingchildcare or by taking action to narrow the gender pay gap.
So many clients and employees trust the company aroundthe world as it is consistently delivering for all its stakeholders.
Everything it does from driving for gender equality, to improving
quality of life, proves the old adage beauty is not only skin deep.
I know what it’s like to be the ‘first woman’ or the ‘only woman’
professionally. I was the first female engineer ever to qualify
to work offshore in Britain’s oil and gas industry. As my career
progressed from engineering to banking and now technology,
I have often been the only woman at the management or board
table. How can we get more women a seat at those tables?
By having more companies as committed to diversity as
Shiseido! It’s not an easy path, but as the old Japanese adagesays, 七転び八起き (nana korobi ya oki — “Fall seven times, get
up eight”).

Ann Cairns — 30% Club Global Chair andExecutive Vice Chair of Mastercard

Annex

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Society

Empowering Women and Girlsand Helping Them Become
Self-Reliant
Over the years, Shiseido has launched several initiatives toempower women and address global gender issues. Working
closely with our brands and regional headquarters, we support
the education of socially disadvantaged women and girls
around the world to enable them to be more self-reliant.
Clé de Peau Beauté: Supporting Education for Girls
In 2019, Clé de Peau Beauté announced a global partnershipwith UNICEF1 to support girls’ education and empowerment
around the world. The brand pledged the world’s largest
contribution of USD 8.7 million in support of UNICEF’s Gender
Equality Program. In this way, the brand helps to promote theorganization’s effort to empower 6.5 million girls globally withskills for the future through education, skills development, andempowerment programs.
A CRM Campaign2 featuring the brand’s best-selling product,
The Serum, was launched in 2020 to invite consumer
participation and raise awareness for UNICEF’s program.

Primarily focused in-store, the campaign spans 21 countries
and regions.
In 2019, Clé de Peau Beauté also announced a long-term
philanthropic endeavor to advocate for girls’ education,
empowering a brighter tomorrow. The brand launched thePower of Radiance Awards to honor women from aroundthe world who have acted to drive positive change throughknowledge3.
In 2020, the Power of Radiance Awards recognized Binita
Shrestha and Pratiksha Pandey from Nepal, who have madeincredible contributions to the education and empowermentof girls in STEM4 fields in their country.
1

UNICEF does not endorse any company, brand, product or service.

2

Cause Related Marketing (CRM) Campaign whereby a portion of The Serum’s sales
will be donated to support UNICEF’s program.

3

Grants from the Power of Radiance Award are donated to a charitable organizationof the award recipient’s choice in support of educational initiatives.

4

Science, Technology, Engineering, and Mathematics.

Recipients of The Power ofRadiance Awards 2020

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@UNICEF/UN041263/Pirozzi

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STEM 4 Girls for the 21st century
workforce at Kyrgyzstan

Environment

CultureGovernanceAs co-founders of Women in STEM Nepal (WiSTEM Nepal), both
women were recognized for their pivotal roles in leading STEM
education and diversification projects, empowering girls andwomen to pursue their interests in science and technology.

International Women’s Day: Shiseido Global Action
With the aim of empowering women around the world,
we celebrate International Women’s Day across our
regional headquarters.

Clé de Peau Beauté is proud to take actions to deliver tangible
results through championing STEM-related education. In thepast year, due to COVID-19, education activities have been
disrupted. Our increased reliance on technology has made it
clear that the future will demand a greater focus on STEM fields
for the next generation of girls to succeed and thrive — making
our initiative even more meaningful as we help to develop a
blueprint for building girls’ and young women’s skills both intimes of crisis and for the future.

In line with our 2020 International Women’s Day theme of“Gender Bias: Recognize Invisible Biases and Be Yourself”, ourglobal headquarters in Japan shared messages of support onvarious platforms, including social media. Shiseido Asia Pacificand Shiseido Travel Retail distributed information to employees
to deepen their knowledge of gender equality. Shiseido EMEA
created posters to introduce its gender equality efforts, andproduced an internal movie featuring interviews on the themeof “Biases Within Ourselves.” And Shiseido Americas invited Girl
Scout members to its offices to learn about social activities,
and shared a movie with employees focusing on equality andempowerment beyond gender.

Shiseido Travel Retail:Supporting Socially Disadvantaged Women
In 2020, Shiseido Travel Retail partnered with FriendsInternational on ‘Empower Her’. This initiative aims to help
young women from disadvantaged backgrounds in Cambodia
break the cycle of poverty by providing education, vocational
beauty training, access to job placement opportunities, andemployment support.
In support of the initiative, we provide cash donations
and beauty products; we are also actively involved in thedevelopment of the training curriculum.

Vocational beauty training

Society

In 2020, 37 students received vocational beauty training —eight of whom were placed in employment. Through thisinitiative, we aim to provide training and employment support
to around 70 women per year.

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Diversity, Inclusion and the
Empowerment of Womenat Shiseido
We aim to build a culture that respects and supports thediversity of our workforce. By empowering people from various
backgrounds, we are creating an environment where each
employee feels valued and included. In particular, we actively
promote the empowerment of women in Japan.
Empowering Women at Shiseido
Women’s empowerment in the workplace is one of our top
priorities. As of December 2020, 83% of Shiseido Group’s
workforce were women. The percentage of women in
leadership positions across our global organization was 57.5%1.
As of March 2021, 46.2% of our board members were women.
In Japan, as of January 2021, the percentage of female leaderswas 34.7%. We aim to increase this to 50% to fairly represent
gender equality.
To support this initiative, we introduced a workshop program
called “NEXT LEADERSHIP SESSIONS for WOMEN” in 2017.
These workshops provide training specifically designed forfemale employees pursuing a career in management, with afocus on issues unique to women.

In 2020, we introduced “Speak Jam”, a mentoring program
connecting female corporate officers with female employees.
The program provides information and support on thechallenges women often face in life and in the workplace, andour female corporate officers provide guidance based on theirpersonal experiences. Speak Jam has become an important
program for women at Shiseido in Japan, promoting a morepositive outlook for their careers and, in the case of female
corporate officers, helping to resolve issues that often impede
the advancement of women.
External Recognition
In 2020, we received the Prime Ministerial Award for WomenEmpowering Companies from the Cabinet Office of Japan. We
were also selected as a “Nadeshiko Brand”2 by Japan’s Ministryof Economy, Trade and Industry (METI), and the Tokyo Stock
Exchange (TSE).
Such external recognition is the result of our efforts to support
the empowerment of women in the workplace, including
career development and management training, as well as our
promotion of a healthy work-life balance for female employees.

Our group President and CEO, Masahiko Uotani was also
recognized for advancing various leadership initiatives toeliminate the gender gap across Japanese society through hisroles as Chair of 30% Club Japan, which aims to increase theratio of women among Japanese corporate board members,
and as Co-Chair for the Committee on Diversity and Inclusion
at KEIDANREN (Japan Business Federation).
Outside of Japan, we were recognized for our diversity in senior
management by the WomenCorporateDirectors Foundation(WCD) — a network of female executives from companies fromaround the world. We were the first Japanese company to win
a WCD Visionary Award in the ‘Leadership and Governance ofa Public Company’ category.

“Speak Jam”, a mentoring
program connecting female
corporate officers withfemale employees1As of January 1, 2021 in Japan, andDecember 31, 2020 overseas.

2

The Nadeshiko Brand designation was
launched to publicize outstanding listedcompanies that are successfully encouraging
women to play active roles in the workplace,which in turn attracts investors focusedon medium- and long-term growth ofcorporate value.

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COMMITMENT 2

Empowering People Throughthe Power of Beauty

At Shiseido, we strive to empower everyone through the power of beauty.
Throughout our history, we have studied the therapeutic and empowering
effects of cosmetics. In 1956, we introduced Japan’s first makeup productdesigned to conceal burn marks suffered in World War 2. Since then, we
have developed a wide range of cosmetics for discolorations and scars. In
recent years, we have harnessed the power of beauty to support cancer
patients and survivors coping with changes in appearance related to theirtreatment. And, in 2013, based on extensive research at care homes, weestablished a cosmetic therapy program to promote healthy life expectancy.
We aim to support a society where people feel empowered, confident andfree to be themselves. And we strive to share our expertise in beauty careand research into aging society with countries and regions that face similar
challenges as Japan.

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Top Message

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Shiseido Life Quality Makeup:
Supporting People with Serious Skin Concerns
We have been committed to improving quality of life throughcosmetics since the 1950s. Today, as part of the Shiseido Life
Quality Makeup initiative, we operate dedicated Life Quality
Beauty Centers in five countries/regions around the world.1

Men’s Grooming
For Cancer Patients

In 2020, in order to continue activities during the COVID-19
pandemic, we shifted our focus to digital solutions. We beganoffering online consultations in China and developed the Makeup
Navigator website in Japan.2 Such activities allowed us to support
consumers in the comfort and safety of their own homes.
This year, we also presented an abstract on the efficacy of
Perfect Cover Foundation products on vitiligo3 at theInternational Pigment Cell Conference.4 Part of our Life
Quality Makeup lineup, Perfect Cover Foundation is a seriesof specialized foundations for deep skin concerns, including
scars and discolorations.

Shiseido Life Quality Makeup

Shiseido Asia Pacific received a Champions of Good award in2020 for its sustainability efforts in Asia — including activities
led by the Shiseido Life Quality Beauty Center.5 The awards
recognize organizations that are exemplary in their corporate
giving, and those that engage partners and stakeholders intheir initiatives.
Supporting People Living with Cancer
Since 2008, we have supported people affected by changes intheir appearance due to cancer treatments.

Online makeup lessons

As medicine advances, there is an increased focus on how toincrease quality of life for people living with cancer. In 2019,
we published the Beauty Book for Cancer Patients, following

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up in 2020 with Men’s Grooming for Cancer Patients.6 We haveprovided these books to 385 cancer hospitals in Japan. We also
work with CancerNet Japan, a certified non-profit organization,and the Japan Cancer Society, a public interest incorporated
foundation, to offer beauty care seminars at hospitals.
In 2020, SHISEIDO BEAUTY SALON released a medical wig
that can be customized to fit the wearer’s head size and haircondition. Through counseling and total care of the hair andscalp, our care advisors7 help make daily life more comfortablefor our consumers.
Building on our experience in Japan, we are keen to expand
our efforts globally. Last year, in Spain, working with Asociación
Española Contra el Cáncer, we offered online makeup lessons
to 101 cancer patients across 10 cities.
LAVENDER RING:
Supporting People with Cancer to Live with a Smile
Since 2017, we have participated in LAVENDER RING, amultilateral project to support people with cancer. As part ofthe project, we lead MAKEUP & PHOTOS WITH SMILES, whichuses the power of beauty and photography to empower thesocial and professional lives of people with cancer.

1Japan, China, Hong Kong, Taiwan, Singapore as of December 2020.

2D ue to COVID-19, we revised our plan to expand to 14 countries and regions by 2020.

3V itiligo is a long-term condition where pale white patches develop on the skin. It is caused
by a lack of pigment in skin.

4A bstract title: QOL effect of cosmetic camouflage for vitiligo.

5C hampions of Good was launched in 2017 under the Company of Good in Singapore.

6A lso available on the Shiseido Life Quality Makeup website.

7C are advisor is our name for certified beauty artists who have completed our original educational
curriculum and passed the certification exam.

Top Message

Private online makeup lessons
on LAVENDER RING

Designated privateroom (Sugi Pharmacy
Fushimi Branch)

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In 2020, we exhibited photos from the program at LIVEEMPOWER CHILDREN 2020, a charity event in support ofpediatric cancer. This was also the year when LAVENDER RING
was held online for the first time. 35 Shiseido employees
volunteered to provide individual online makeup lessons to84 people with cancer nationwide. The event also included apanel discussion with celebrities — all of whom had a personal
experience of cancer and wished to share messages of hopeand encouragement with the audience. Finally, the LAVENDER
RING expanded outside of Japan for the first time this year,with activities introduced in Taiwan.

Supporting Older People
Due to COVID-19, we were unable to offer Shiseido Beauty
Seminars to senior citizens in 2020. However, Shiseido Beauty
Therapists continued to inspire happiness by writing letters ofencouragement and creating exercise videos for residents at
nursing homes throughout Japan.10

In recognition of our efforts, we received a Mécénat certificationby the Association for Corporate Support of the Arts and the
2nd Nikkei SDGs Management Grand Prix Social Value Award.

In September 2020, one of Shiseido’s researchers delivereda presentation at the 84th Japanese Psychological Association
Symposium.12 The presentation introduced cosmetic therapy
activities and explained how skincare and makeup canbenefit the frontline of medicine and care for older people byimproving and maintaining physical and mental functions, andenhancing quality of life.

Collaborating with Retail Partners
to Build Support Networks in Local Communities
In 2015, Japan’s Ministry of Health, Labour and Welfare
issued guidelines to promote healthy lifestyles among local
communities. This inspired the creation of support structures
for people with cancer, and senior citizens nationwide. To
support this initiative, we are committed to providing local
communities in Japan with specialized beauty information.
In 2020, we collaborated with Sugi Pharmacy to give local
people with cancer better access to our beauty care service. In
November, Sugi Pharmacy set up a private room in its Fushimi
branch to mark the launch of our Perfect Cover Foundation.
We also developed the ‘Beauty For Health’ program, which
incorporates research findings from Shiseido’s cosmetic
therapy to help older people.8 As of December 2020, 459 CRC9
member retailers had adopted the program.

Our efforts at a community level also remain strong, withmedical workers who are certified as Shiseido Cosmetic
Therapists sharing their expertise in cosmetic therapy at healthand wellbeing workshops across the country.11

Outside of Japan, Shiseido Taiwan received the 16th Annual
Corporate Social Responsibility Award from Global Views
Monthly for its beauty seminars, which focused on using
makeup and skincare for physical and mental wellbeing, as well
as a socialization tool. The seminars were attended by 3,053
older citizens.

8S hiseido’s cosmetic therapy uses skincare and makeup application techniques to help improveand maintain mental and physical health, quality of life, and healthy life expectancy.

9C RC: National Federation of Cosmetic Retail Cooperative.

10P rovided to 23 facilities nationwide.

11L aunched in 44 prefectures (as of December 2020).

12H eld online.

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CultureSupporting People with Visual Disorders
In the 1980s, we began developing educational materials to
assist consumers with vision impairments or low vision. This
included beauty manuals in Braille, Braille stickers for products,
and Braille dosage stickers.
Our cosmetics advice website, Shiseido Listener’s Café uses
text-to-speech (TTS) software. It provides various information,
including a basic introduction to cosmetics usage. The website
also features an audio-based periodical on seasonal beauty
information, called Fashionable Moment (Oshare-na Hitotoki).

Grooming lessons

In 2019, in cooperation with organizations for people with visual
impairments, we developed SHISEIDO Guide Make, a cosmetics
application method for people with visual impairments. By
using their hands and fingers to guide them, people can apply
their own skincare and makeup.

Local workshop led by medical
workers (Fukuoka, Japan)

Supporting Children in Foster CareOur children are the future, and at Shiseido, we are committed
to building a society where every child can thrive and not asingle one is left behind.
The Shiseido Social Welfare Foundation is engaged in a diverse
range of activities in support of children living in social care.13
Since 2005, to promote self-reliance among such children,the foundation has organized seminars focused on grooming,
etiquette, and other skills. Developed and run in collaboration
with Shiseido Japan Co., Ltd., AOKI, Inc., Recruit Co., Ltd., andother organizations, these seminars aim to help prospective
high school graduates prepare for further education or acareer to live independently. The foundation also offers
scholarships for higher education, and training programsand educational magazines for staff at child welfare facilities.

SHISEIDO
Guide Make
13

The Shiseido Social Welfare Foundation isa public interest incorporated foundation.

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COMMITMENT 3

Promoting Respectfor Human Rights

Our Stakeholders

Employees
Business
Partners

Shareholders

Consumers

At Shiseido, respect for human rights is at the core of our DNA. Across ourbusiness, we are dedicated to respecting and protecting the rights of our diverse
group of stakeholders, including business partners and employees.
We are committed to eradicating human rights issues — including forced laborand child labor — as well as workplace harassment, which is an issue that has
become more prevalent due to changes in social structure and the rise of morediverse values. We are aware that failure to take appropriate action against such
issues poses great risk to our company and all our stakeholders.
Across the Shiseido Group, we have standards and policies in place to guide ouractions when it comes to human rights. Based on the Shiseido Group Standardsof Business Conduct and Ethics, which stipulate the mandatory behavior
expected of every individual working for the Shiseido Group, we ensure thatour business is always conducted according to high ethical standards.

Society

Shiseido Group Policyon Human Rights

Shiseido Group Standards ofBusiness Conduct and Ethics

Respect for Human Rights

Human
Rights Due
DiligenceTop Message

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Respecting
Human Rights

Respect for human rights is integral to our working principles.
It is part of our definition of running a sustainable business andcontributing to the realization of a sustainable global society.
Since 2011, we have followed the Shiseido Group Standards ofBusiness Conduct and Ethics, which stipulate the mandatory
behavior expected of every individual working for Shiseido. We
have also established Shiseido Group Policy on Human Rights,
and we have been working closely with our business partners
to define and update the principles and policies surrounding
ethical business conduct. These are reflected in the Shiseido
Group Supplier Code of Conduct, which stipulates the standards
that govern and direct our behavior on human rights, legal
compliance, labor practices, intellectual property protection,
confidentiality, environmental protection, and fair trade.
All business partners subject to the Shiseido Group Supplier
Code of Conduct have agreed to our standards and are
required to accept periodic monitoring through surveys andaudits. In the event that any supplier is identified to haveviolated the code, they are requested to implement corrective
actions under our guidance.
Human Rights Due Diligence
We have established a human rights due diligence process tohelp us promptly identify potential human rights issues.
In 2020, in order to prevent or mitigate human rights issues,
we took steps to identify and assess the visible and potential
impact of our activities. These efforts included:
Identification of human rights issues
In cooperation with external human rights experts, and byreferencing international codes on human rights, standards
on non-financial disclosures, and the Corporate Human Rights
Benchmark (CHRB), we have developed a list of human rights
issues to be considered. This list includes modern slavery
issues, such as forced labor and child labor, as well as a wide

range of human rights issues, such as freedom of association,
the right to collective bargaining, and discrimination.
Assessment of human rights risks
We assessed the status of our activities against the humanrights issues identified above. This was done by interviewing
stakeholders (consumers, business partners, employees,
shareholders, and members of society)1 in Japan and overseas;
and investigating internal documents such as questionnaires,
surveys and certain reports. We also referred to external
documents for any potential impact on human rights. Basedon our findings, we assessed the severity and likelihood of both
visible and potential risks regarding impacts on human rights
in Japan and overseas, as well as the status of preventive andcorrective measures.

1

Including women, children, indigenous people, migrant workers, temporary workers, etc.

In 2020, we
took steps to
identify andassess thevisible andpotential
human rights
impact of ouractivities

36Top Message

After assessing our value chain, we identified a number of humanrights risks: “discriminatory actions/expressions,” “violation ofcompliance/fair competition,” “personal/confidential information
leakages,” “employees’ personal data and privacy,” “incomplete
supplier management,” “occupational safety and health issues(work-related accidents),” “breach of working hours, breaks, andrest period (overtime-work),” and “harassment and abuse.”2
Going forward, we will prioritize the human rights issues andrisks discovered in our identification and assessment activities
in 2020. We will take measures to reduce both manifest andlatent risks, strive to further enhance preventive and corrective
measures, and promote improvement efforts.

In December 2020, our global headquarters Purchasing
Department held an internal training session with an external
lecturer. During the training, participants exchanged opinions
on supplier assessment, including social trends in sustainableprocurement and what is required in terms of human rights,
labor, health and safety, environment, and ethics.
2

In no particular order.

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CultureHuman Rights Risk Assessment(Identification and Assessmentof Impacts)

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Human Rights Risk Reduction
Activities
Improvement activities aimed at curbing, preventing,and mitigating negative impacts on human rights.

Assessment of human rights risks related to all
stakeholders (consumers, business partners, employees,
shareholders, and members of society).
Review the status of respect for human rights when
considering new business relationships, such as
mergers and acquisitions.

Human
Rights Due
Diligence
Process

Education and Training in Ethics and Equality
Every year at our global headquarters in Japan, we conduct
training on the Shiseido Group Standards of Business Conduct
and Ethics, and/or related policies and rules. This takes placethrough various internal programs, such as position-specifictraining, in order to promote a better understanding of ethicalbehavior among employees.
In 2020, due to the impact of COVID-19, we were unable toconduct training for executives and department directors. We
did, however, conduct human rights awareness training for 7,709
Group employees in Japan. This training was conducted online
under the theme of “preventing unconscious and unaware
discrimination.”

Environment

Report/Disclosure

Confirmation of Progress

Report/disclose progress to stakeholders.

Check the progress of improvement activities andpromote improvements to further reduce humanrights risks.

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Human Resources
At Shiseido, we aim to build a culture that respects the diversity of ourworkforce, and strive to nurture everyone’s talent and potential by creating
an employee-friendly environment.
Diverse Work Styles
In 2020, we promptly took actions in response to the spread of COVID-19.
Digitalization played a key role in these actions, and our global efforts
allowed us to introduce flexible working styles — including working from
home, remote work, online meetings, and staggered work schedules. We
also introduced more diverse work styles, including the elimination of fixedworking hours to allow for a more flexible work schedule.
In Japan, we studied the effect on employees’ productivity and mental
health as a result of working from home. In Singapore, Shiseido Travel
Retail launched a platform that allows employees to share a wide rangeof resources, including information on COVID-19, advice on physical andmental health, and tips on how to work from home efficiently.
We are currently in the process of introducing the new Shiseido Hybrid
Work Style, a company-wide initiative tailored to accommodate even morediverse work styles.
Globalization of Human Resources
At Shiseido, the people we employ are essential to our PEOPLE FIRST
philosophy. We have been strengthening career development in order
to empower our diverse workforce and offer cross-border career
opportunities.

In 2020, to improve our global human resource management practices,
we introduced TRUST 8, a set of working principles to help guide our
employees throughout their career. Also, for selected talent, we offer
enrolment in the Shiseido Leadership Academy, a global management
education program aimed at developing in-house talent and creating
connections across our international network.
Human Resource Development
We encourage the personal development and self-growth of all employees
by providing individual support to help them advance their career.
In preparation for the introduction of a job-based personnel system, ourglobal headquarters worked with its major affiliates in Japan to define
the specialized knowledge and skills required by each position. This
information was then shared with employees as detailed job descriptions.
Since 2020, we have been organizing career workshops for all employees
in Japan, aiming to enhance self-driven career development and strengthen
personal expertise. By the end of 2020, 2,164 employees have participatedin the program. We have also been working to improve our management
skills training for leaders to ensure fair evaluations and to enhanceresourcing of all departments.
In addition, we offered a variety of self-development initiatives to
employees in Japan, including: online business skills training (219employees participated); leadership training for future female leaders(24 executive candidates participated); short training videos covering

topics such as presentations and project management; and virtual toursof the corporate museum aimed at new employees.
As a result of our efforts, Shiseido Group employees spent an averageof 26 hours on education and training in 2020.
Diversity and Inclusion in the Workplace
Across the Shiseido Group, we aim to build a culture that respects thediversity of our workforce and empowers employees to play an active role.
In 2020, 1,370 Shiseido employees in Japan took childcare leave (including
67 men), and the retention rate after returning to work was 94.1%. For
those returning to work after childbirth, we conducted welcome-backseminars to help ease any anxiety about balancing work with childcare.
26 employees participated in the seminars. We also introduced Reverse
Mentoring — a diversity and inclusion initiative in which employees act
as mentors to corporate officers and department directors. This initiative
encourages open discussion and aims to create a flat organizational
structure that embraces and incorporates different ideas. In 2020, 178
employees and executives participated.
In Japan, we continue to provide LGBTQ training for Beauty Consultants,
and since 2020, we have been a supporter of Business for Marriage
Equality, a campaign to promote equal marriage and the legalization ofsame-sex marriage.

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SocialContribution

We encourage all our employees to consider social issues andways in which we can address them. Based on our sustainability
principles, we offer social contribution activities across thefields of environment, society, and culture, and our employees
have the opportunity to take part in these activities.
Since the emergence of COVID-19, we have been supporting
medical professionals and people affected by the pandemic
through various initiatives, including providing hand sanitizers
and cosmetics.
Employees’ Social Contribution Activities
Despite restrictions due to COVID-19, approximately 3,400
Shiseido Group employees participated in social contribution
activities in 2020. Based on our sustainability principles,
activities were broad in scope and spanned the fields ofenvironment, society, and culture.
Inspired by the power of beauty, we implemented activities
that only Shiseido can offer. These included virtual hairand makeup lessons, cosmetics donations, and monetary

donations — all implemented under strict regulations toprotect our employees and help stop the spread of COVID-19.
Shiseido EMEA hosted its fourth annual “Camellia Day” andmore than 600 employees from 10 countries participated inthis event. In Shiseido Americas approximately 500 employees
participated in 20 programs under “THE BEAUTY OF HELPING
OTHERS” initiative.
As part of our activities to help solve social issues, Shiseido
Americas also supported LGBTQ organizations, and Shiseido
Japan co-sponsored online seminars in cooperation with local
governments for mothers raising children during the pandemic.
Activities to address environmental issues included planting
wheatgrass in Thailand on “World Soil Day”. The aim of thiswas to raise awareness around the conservation of tropicalrainforests and global warming. In Japan, EMEA, Americas,
and Asia Pacific, schemes have also been established to allow
employees to take part in social contribution activities during
working hours.

Camellia Day in Belgium ­— productdonations for women in need

Global Expansion of the Shiseido Camellia FundThe Shiseido Camellia Fund is backed by charitable
contributions from current and retired Shiseido Group
employees. It supports NPOs and NGOs working to solve
social issues. The fund began in Japan in 2005 and expanded
globally to all regions in 2020. Organizations to be supported
are selected according to our sustainability principles in thefields of the environment, society, and culture.

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Top Message

In each region,
we have
contributed tocommunities
through volunteer activities,
monetary
donations,and cosmetic
donations

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Responding to the COVID-19 Pandemic
The health and safety of all Shiseido employees has been
our priority since the outbreak of the COVID-19 pandemic.
In early February 2020, we set up a COVID-19 Emergency
Task Force in our global headquarters. This team has been
responsible for sharing our safety guidelines across all regions.
In addition, our regional headquarters set up their own task
forces to support employees and their safety while working
throughout the pandemic.
Using our knowledge, technologies, and facilities, we developed
a new hand sanitizer for sensitive and raw hands. Two of
our factories in France, located in the Cosmetic Valley, haveproduced more than 400,000 units of this hand sanitizer
since March 2020. At our East Windsor factory (USA), Shiseido
Americas produced over 120,000 units of hand sanitizer anddonated the majority of them to local hospitals, nursing facilities
and community outreach organizations, helping to address a
shortage of sanitizer.
Shiseido China Co., Ltd. visited seven cities
throughout China with the “LOVE BUS” aspart of its Relay of Love project

In Japan, we produced 1,840,000 units of the hand sanitizer
at four factories in 2020, and have donated 210,000 units tomedical institutes and facilities.
Since June 2020, Shiseido China Co., Ltd. has conducted atour across seven cities in China (Shanghai, Chengdu, Guiyang,
Beijing, Xi’an, Shenzhen, Wuhan) with the “LOVE BUS.” The
tour, which is part of phase two of our “Relay of Love” initiative,
aims to share our gratitude and present 180,000 speciallymade “Relay of Love” cosmetic gift boxes to frontline medical
personnel.
At each of our regional headquarters, employees and affiliates,
have contributed to their communities through volunteer
activities, monetary donations, and cosmetic donations.

Shiseido Asia Pacific, Shiseido Travel Retail, and Shiseido
Singapore worked together to donate skincare products tohealth and community care heroes in support of “SG Cares
Giving Week,” a nationwide initiative in Singapore whichcelebrates the spirit of giving. Shiseido EMEA has donated
EUR 1 million to the Red Cross, which was subsequently split
between the five arms of the organization in France, Italy, Spain,
Germany, and the UK.
We will continue to support our employees, local communities,
and society as the situation with COVID-19 evolves.

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CultureGovernance

CultureCOMMITMENT 1

Drawing on Our Heritage
and Culture to Imagine
a Better Future
Read more

COMMITMENT 2

Inspiring the World With
Our Sense of Beauty
Read more

Using our heritage
to create new value
and enrich culture

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Top Message

CultureEnvironment

Society

CultureGovernance

Annex

Shiseido’s rich heritage is the source of our corporate culture. It explains ourbeginnings and our founder’s vision of beauty; it celebrates what we haveaccomplished; and it defines our purpose as we move into the future.
Since our foundation in 1872, we have developed a heritage of innovation,transformation, and the creation of social value. To grow our business and continue
to create social value, our heritage serves as our inspiration and driving force.
We must nurture it while strengthening the bonds created by our sharedcorporate culture.
As a global beauty company, we consider it our mission to inspire the world with
our vision of beauty born in Japan — using it to stimulate a diversity of values andcreate a new and rich culture worldwide.

COMMITMENT 1

COMMITMENT 2

Drawing on Our Heritage andCulture to Imagine a Better Future

Inspiring the World With
Our Sense of Beauty

42Top Message

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COMMITMENT 1

Drawing on Our Heritage
and Culture to Imagine
a Better Future
Our heritage has been passed down from one generation to the next,
helping us to nurture our corporate culture and inspire innovation. Our
employees around the world learn about our heritage, founding spirit andcorporate DNA through venues such as the Shiseido Corporate Museum,with its virtual tour, digital video content, and more.
Our heritage also inspires our people, instilling a desire for constant personaltransformation, strengthening individual resilience, and creating a leadershipmindset. In this way, our heritage plays a key role in the training anddevelopment of our future global leaders — helping them to carry forward ourhigh ethical standards and unique sense of beauty, as well as creating newsocial value and building a better world.

PEOPLEFIRST

DIVERSITYART &SCIENCEOMOTENASHI

UNCOMPROMISINGQUALITY

JAPANESEAESTHETICS

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Using Digital Technology
to Share Our Heritage
with Employees
Discover Shiseido— Inside our DNA

Discover Shiseido — Inside our DNA
Our workplaces around the world are home to a diverse
range of people. In 2020, in order to deepen our employees’
understanding of our DNA, we published Discover Shiseido —Inside our DNA (available in Japanese, English, Chinese, andFrench). The publication focuses on Shiseido’s heritage fromthe viewpoint of innovation, presenting our origins, philosophy,
history, culture, and more, in a compact pocketbook.
The aim of this publication is to enable every employee tocommunicate Shiseido’s uniqueness to our consumers, partnercompanies, and society as a whole. As employees, we mightcome from different countries and have diverse backgrounds,
but we all carry the same pocketbook. This creates a senseof unity among the Shiseido family, and serves as a source ofknowledge and inspiration for every one of us.

Shiseido Corporate Museum Virtual Tour
2022 will mark Shiseido’s 150th anniversary. To celebrate sucha landmark, and promote our heritage — and future — ofbeauty innovations, we are using digital technology to share
our story with employees worldwide.
Content created in 2020 has allowed employees around theworld to take a virtual tour of the Shiseido Corporate Museumin Kakegawa (Japan). The content is available on our intranet
in three languages (Japanese, English, and Chinese). By 31
December 2020, more than 4,000 people had taken the virtual
tour, and the platform had been accessed over 20,000 times.
Our aim with such initiatives is to accelerate the future successof Shiseido by inspiring employees with our rich heritage andhistory of innovations.

Corporate Museum
Virtual TourTop Message“What Heritage Tells Us,” a seriesof brief stories, shared on our intranet

Environment

What Heritage Tells Us
Through times of adversity and turbulence, the passion anddedication of Shiseido employees worldwide have enabled us
to overcome significant challenges. Throughout our history,
innovation has paved the way for a future of beauty. Thatremains true to this day, and our heritage continues to spark

Society

CultureGovernanceAnnex

the creativity needed to carry us forward. It is with this belief
that we launched “What Heritage Tells Us” in April 2020 —a series of brief stories shared on our intranet. The stories
revisit innovations and achievements throughout our 149year history, highlighting the ways in which our founders andemployees overcame adversity to ensure the future of Shiseido.
New content will be published on an ongoing basis inconnection with notable events and important dates. During
the course of this year, we have released 12 stories in English
and Japanese. Our aim with “What Heritage Tells Us” is tomotivate and inspire our employees around the world. During
the first year of its launch, the series received more than 16,000
views, and this number continues to grow.
Shiseido Japan’s Marketing Academy
and Other Online Seminars
Our seminars are designed to help employees gain a deeper
understanding of our corporate heritage.
In 2020, due to the COVID-19 pandemic, we moved theseseminars online, and employees from various fields — including
marketing, and research and development (R&D) — actively
participated. We held 10 seminars over the course of theyear, with each session tailored to the individual needs of thedepartments involved.
We designed these interactive seminars to help our employees
draw on the power of our heritage to create innovation. Around
1,400 employees attended. Looking ahead, we will create evenmore opportunities for employees to learn about Shiseido’s
heritage, providing motivation and insights they can use in their
day-to-day work.

We will createeven more
opportunities
for employees
to learn about
Shiseido’s
heritage,
providingmotivationand insights

45

Top Message

Environment

Society

CultureGovernance

Annex

COMMITMENT 2

E RY

THIN

G

Inspiring the World
With Our Sense
of Beauty

Shinzo Fukuhara, the first president of Shiseido, believed in the “richness ineverything”. He placed beauty sensibilities and emotional depth at the coreof our company, and our business is based on this philosophy.
We continue to nurture this philosophy. By collaborating with our network ofartists and galleries, we develop programs designed to educate and inspire
our employees. By stimulating their sense of beauty and appreciation ofaesthetics, we aim to inspire and enrich society.

ES

S

IN

EV

Art and science are deeply ingrained in our DNA. From the very beginning,they have been present in every aspect of our business, working hand inhand to inspire beauty innovations, and create new and unique approaches
to beauty.

RI

N
H
C

46

Top Message

Elevating our Brand
Through Art andHeritage

Environment

Society

CultureAnnex“GINZA and SHISEIDO” feature

20,000copies distributedin China

Hanatsubaki — Chinese Issue
We launched Hanatsubaki magazine in 1937. To communicate
our heritage and aesthetic sense to a wider audience, we began
publishing it in English in 2019 and Chinese in 2020.
The 2020 Summer/Autumn edition marked Hanatsubaki’s entry
into China, and we distributed 20,000 copies of the magazine in
15 cities nationwide. We held launch events across the country,
and in November 2020, distributed 1,000 copies at the 3rd
China International Import Expo in Shanghai. The response wasfantastic. As a result of our Chinese Regional HQ’s efforts onsocial media, the magazine’s readership — as well as its profile— has increased.
By offering Hanatsubaki magazine in Chinese, we aim to share
our unique sense of Japanese beauty and deep cultural insights
with a new audience and a younger generation of readers. In
doing so, we hope to stimulate interest in, and build preference
for, Shiseido in China.

Governance

A
Z
N
I
G
语
座物

银

英明

：滨田

沙

依来

故事

封面

Hanatsubaki
Chinese issue

池田

S
E
I
R
STO
摄影

47

Top Message

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Annex

48

Shiseido Gallery
The Shiseido Gallery, which opened in 1919, is one of theoldest art galleries in Japan. Since its opening, the gallery has
been renowned for its constant efforts to support young andforward-thinking artists, and for the way it explores and pushes
the frontiers of contemporary art.
In 2020, the Shiseido Gallery held a number of exhibitions
to encourage dialogue and interaction between Shiseido
employees and guest artists. The aim of these exhibitions wasto create new opportunities for Shiseido brands, employees
and artists alike, by providing a platform for creativity, learning,and knowledge sharing.

Mécénat Award acceptance
lecture by Keiko Toyoda,
Shiseido Gallery Director

Receiving the Special Award at the Japan
Mécénat Awards
At the Japan Mécénat Awards 2020, sponsored by the
Association for Corporate Support of the Arts, Shiseido waspresented with the Special Award granted by the Commissioner
for Cultural Affairs. This award was given in recognition of
our achievements in the planning and operation of the
Shiseido Gallery.
We were highly praised for taking on the challenge of creatingsocial value through art, and for continuously evolving
while carrying on the spirit of our founder. The judges werealso impressed by our policy of incorporating culture into
management, raising shared awareness among employees,
and tackling social issues.

The 14th shiseido art egg, featuring
artist Taishi Nishi’s “Ghost Demo”

Among the 165 eligible projects, one received a Grand MécénatAward, five received Awards for Excellence, and one received
a Special Award. The Shiseido Gallery also received the Grand
Mécénat Award in 2007, and the Flower Art Award in 2014.

Governance
Basic Policy on Corporate Governance / Corporate Governance System

Top Message

Environment

Society

CultureGovernance

Annex

Governance
Basic Policy on Corporate Governance
The Shiseido Group including the Company regards corporate
governance as our platform to realize sustainable growththrough fulfilling the corporate philosophy and as one of
the key elements for our environment, society, culture, andgovernance (ESCG) management.
The Company is committed to maintaining and improving
management transparency, fairness and speed, by putting into
practice and reinforcing the corporate governance, and strives
to maximize medium-term corporate and shareholder value
through dialogues with all stakeholders (consumers, business
partners, employees, shareholders, society, and the Earth).
In addition, while fulfilling social responsibilities, the Company
aims to achieve optimized distribution of values torespective stakeholders.
Corporate Governance System
Reasons for Adoption of Current Corporate Governance
SystemThe Company has adopted the framework of a company with
the Audit & Supervisory Board system, which exercises thedual checking functions over business execution by the Boardof Directors and over the legality and effectiveness by the
Audit & Supervisory Board members. In order to maintain andimprove management transparency, fairness and speed thatare provided in the basic policy for the corporate governancewithin the framework, the Company has incorporated superior
functions of company with the nominating committee, etc.
and company with the Audit & Supervisory Board system, etc.,
reinforcing supervisory functions of the Board of Directors.
The Company concluded adopting the “monitoring boardtype” would be appropriate to ensure sufficiently effective
supervisory functions over the Shiseido Group overall, andhas implemented the “monitoring board-type corporate
governance” while leveraging advantages of the company
with the Audit & Supervisory Board system.
Read more
Meetings Attended by Directors and Corporate Officers
Composed of eight members including four external
directors, the Board of Directors of the Company is small andthereby able to make decisions quickly under the leadershipof President and CEO who serves as a Chairman. The Boardof Directors holds approximately one meeting a month todiscuss all significant matters.
The Company adopts a corporate officer system, whereinfunctions of the Board of Directors to oversee the executionof business are separated from those of corporate officers
who are responsible for business execution. Also, theCompany sets up the “Executive Committee,” a meeting bodythat is responsible for deliberation over important mattersrelated to business execution from various viewpoints prior
to decision-making and the “Meetings for Developmentof Medium-Term/Annual Plans,” a meeting body that is
responsible for developing and resolving business plans
and brand strategies (currently it is replaced by the Global
Leadership Committee which discusses matters related
to business plans and medium-to-long-term businessstrategy from various aspects), thereby, the Company
drives delegation of power to corporate officers to clarify
responsibilities and accelerate business execution. The
President and CEO serves as a chairperson for both meetings.
Also, since January 2021, in order to further evolve thematrix-type management execution system, further improve
profitability and promptly implement structural reforms
throughout the company, the Company introduced a new“executive officer” system (including current corporate
officers). Read more
Diversity of Directors and Audit & Supervisory
Board Members
The Company believes that the Board of Directors of theCompany should be composed of directors with various
viewpoints and backgrounds, on top of multilateralsophisticated expertise, for effective supervision overthe execution of business as well as decision-making on
critical matters.

The Company
is committed
to maintaining
and improving
managementtransparency,
fairness andspeed, byputting into
practice andreinforcing
the corporate
governance50

Top Message

Environment

Society

CultureGovernance

Annex

Implementation
Framework
Furthermore, the Company believes that Audit & Supervisory
Board members should have the same diversity andsophisticated expertise as the directors, as they have aduty to attend meetings of the Board of Directors and state
opinions as necessary.

& Supervisory Board members and corporate officers
remuneration policy of the Company is designed in the
Remuneration Advisory Committee (currently, the Nomination& Remuneration Advisory Committee) chaired by external
directors by incorporating objective points of view.

When selecting candidates, we place importance on ensuringrich diversity, taking into account not only the achievementof gender equality, but also other attributes including age,nationalities and personalities, and insights and experiencesin various fields related to management. In addition, theCompany has set a certain maximum term of office for external
directors and external Audit & Supervisory Board members
in order to reflect their views, which are free from theCompany’s existing structure to the management of theCompany, and by allowing a handover period from longserving external directors and Audit & Supervisory Board
members to newly-appointed external directors and Audit& Supervisory Board members to ensure the appropriate
transition. Read more

The remuneration of the directors and corporate officers
comprises basic remuneration and performance-linked
remuneration. The Company sets remuneration levels bymaking comparisons with companies in the same industry, orof the same scale, in Japan and overseas, and by taking theCompany’s financial condition into consideration.

Remuneration
The Company regards the directors, Audit & Supervisory
Board members and corporate officers (currently, including
executive officers) remuneration policy as an importantmatter for the corporate governance. For this reason, in
accordance with the basic philosophy, the directors, Audit

External directors and Audit & Supervisory Board members
receive only basic remuneration, as fluctuating remunerationsuch as performance-linked remuneration is inconsistent with
their supervisory functions from a stance independent frombusiness execution. Read more

At Shiseido, we are working to promote sustainability across theentire company, including our brands and regional businesses.
In 2020, we launched and held regular meetings of the Sustainability
Committee, a dedicated forum to ensure timely management
decisions and thorough recognition of this theme. The committee
discusses group-wide sustainability initiatives, decides on strategies,
policies, and specific action plans, and monitors the progress of
medium-to-long-term goals. It consists of a representative director
and executive officers in charge of Corporate Strategy, R&D, Supply
Network, Corporate Communications, Social Value Creation andour brands, with other corporate officers participating on an
as-needed basis according to the matter at hand. In addition to
the Sustainability Committee, other significant issues related tosustainability were also discussed with the Executive Committee,
the Innovation Committee, and the Board of Directors, for a total of
12 meetings in 2020.

51

AnnexExternal Evaluations / Environmental Data / Social Data

Top Message

External
Evaluations
Global

FTSE4Good Index Series
SRI indexes that are announced by the UK's FTSE Russell and used byinvestors as one of the sets of ESG ratings. They are a series of indexes
designed to promote investment in companies that meet global
environmental/social/governance standards. (June 2020)

Environment

SRI Indexes Selection Status
Shiseido received positive evaluations from Socially Responsible
Investment (SRI) evaluation institutions of countries worldwide and wasselected for inclusion as a constituent company for SRI indexes, which take

The inclusion of Shiseido Company, Limited in any MSCI index, and the use of MSCI logos, trademarks, service marks
or index names herein, do not constitute a sponsorship, endorsement or promotion of Shiseido Company, Limitedby MSCI or any of its affiliates. The MSCI indexes are the exclusive property of MSCI. MSCI and the MSCI index names
and logos are trademarks or service marks of MSCI or its affiliates.

CultureGovernance

Annex

MSCI Japan Empowering Women Index (WIN)1
An index that is designed by the USA’s MSCI and selects Japanesecompanies that receive a high score for empowering women andpromoting gender diversity. (July 2020)
Shiseido has been continuously selected for excellence in ESG
practices since the introduction of the index in 2017.
FTSE Blossom Japan Index
An index that is designed by the UK's FTSE Russell and selects
Japanese companies that demonstrate strong environmental, socialand governance (ESG) practices. (July 2020)
Shiseido has been continuously selected for excellence in ESG
practices since the introduction of the index in 2017.

MSCI Japan ESG Select Leaders Index1
An index that is designed by the USA’s MSCI and selects Japanesecompanies that receive positive evaluations of environmental, socialand governance (ESG) practices. (July 2020)
Shiseido has been continuously selected for excellence in ESG
practices since the introduction of the index in 2017.

53

account of companies that are highly trusted by society in terms of ethics,
environment, employment and safety in their operations, in Japan andoverseas. The period of selection appears in brackets.

Japan
Shiseido was selected for inclusion in all three ESG indexes that
the Government Pension Investment Fund (GPIF) adopted at the startof ESG investment operations in July 2017.

MSCI ESG Leaders Indexes1
An index that is designed by the USA’s MSCI and selects companies
that demonstrate strong environmental, social and governance(ESG) practices. (July 2020)1

Society

SOMPO Sustainability Index
SOMPO Sustainability Index is a proprietary active index created by
Sompo Asset Management Co., Ltd., which combines environmental,social and governance (ESG) and equity fundamental evaluation.
(June 2020)
Shiseido has been continuously selected for excellence in ESG
practices since the introduction of the index in 2012.

Top Message

Environment

Society

CultureGovernance

Environmental Data
CO2 (t)SCOPE 1 & 21
Total
Coverage (%)2
Scope 1
Coverage (%)2
Scope 2
Coverage (%)2

2020

288,760

267,530

297,784

298,3844

83,24083,70974,619

97.2

96.1

96.8

100

Coverage (%)1

97.2

96.1

96.8

100

31,332

29,62331,99528,129

Electric power

115,933

108,452

115,228

127,188

95.7

94

95

100

Gas2

138,922

126,255

131,330

128,363

60,151

53,61751,71446,490

LPG

3,932

2,941

2,771

2,552

98

97.3

98

100

Fuel3

25,13624,112

24,16916,146

Steam

4,837

5,771

24,28624,1352,649,895

2,524,291

557,375

513,056

1,595,207

1,539,349

End of life treatment of sold products (category 12)

99,99981,897

Total of other categories1

397,314389,988

Calculation method
Total of the categories of 2, 3, 4, 5, 6, 7 and 13.

Total

2019

91,4832020

SCOPE 1, 2, 3

2018

2020

2019

1

2017

2019

All our sites.

Use of sold products (Category 11)

has been third-party certified.

2018

The performance data was calculated based on the GHG Protocol. Scope 2 was based on the market-based method.

Purchased goods and services (Category 1)

Data marked with

2017

2

Total

54

Energy (MWh)1

SCOPE 3

Annex

2019

2020

2,733,604

2,598,910

Energy consumption

1

All our sites.

3

Total value of gasoline, kerosene, diesel oil and fuel oil consumption.

2

Total value of city gas and natural gas consumption.

4

Non-renewable energy consumption for 2020: 256,103MWh.

Water (Mil. m³)
2017

2018

2019

2020

Water withdrawals

1.2

1.2

1.2

1.2

Coverage (%)1

100

100

100

100

Municipal water

0.9

1.1

1

0.9

Surface water

0.1

0.1

0.1

0.1

Ground water

0.1

0.1

0.1

0.3

Water discharged

0.9

1

0.9

1

1

All production sites.

Total net fresh water consumption in 2020 (water consumption excluding theamount of wastewater returned to the same water source): 1.2 million m3.

Top Message

Environment

Society

CultureGovernance

Annex

Data marked with

Waste (t)
2018

2019

2020

9,732

7,786

7,393

7,488

100

100

100

100

Recycled2

9,310

7,479

7,032

7,457

Disposed

422

308

361

31

Waste discharged
Coverage (%)1

1

All production sites.

2

Including thermal recovery.

Coverage (%)1
SOx emissions
Coverage (%)1
Chemical Oxygen Demand
Coverage (%)1
1

All production sites.

In terms of environmental laws, our key consideration is our production sites. With regards to how we operate
our production sites, we make sure that we comply with environmental laws and regulations by conducting
compliance evaluations based on ISO14001 standards.
Investigations of domestic and overseas affiliates revealed no major violations of environmental laws or
regulations in 2020.
We are committed to complying with environmental laws and regulations in terms of how we operate our
production sites.

Environmental Pollution (Air/Water) (t)NOx emissions

has been third-party certified.

Responding to Environmental Risks
2017

2017

2018

2019

2020

5

4

10

8

46.2

54.5

81.8

90.9

0

0

0

0

38.5

54.5

81.8

90.9

98

116

103

70

84.6

90.9

90.9

90.9

55

Top Message

Environment

Society

CultureGovernanceSocial Data

Annex

56

Data marked withhas been third-party certified.

Indicator

2019

2020

2021

Ratio of Female Directors and Audit on the Board (%)

45.5

46.2

46.2

2017

2018

2019

2020

Shiseido Company, Limited

3.3

3.19

3.25

3.04

Period: As of January 1 each year.
Scope: Shiseido Group in Japan (23 companies).

Shiseido Group in Japan2

2.02

2.05

2.12

2.22

2

2.2

2.2

2.2

Ratio of Female Leaders (%)

Period: As of June 1 each year.

Number of Shiseido Group Employees
Indicator

Diversity in Top Management
2018

2019

2020

2021

Total (persons)44,90045,493

46,76345,527

Female Ratio (%)

83.8

83.1

85.6

83

Period: As of April 1 each year.

Period: As of January 1 each year in Japan and as of December 31 of the previous year outside Japan.
Scope: All Shiseido Group.

Number of Employees by Region
Indicator
Japan (persons)Ratio of Employees with Disabilities1 (%)
2018

2019

2020

2021

23,50524,34624,88424,903

TargetIndicator

2018

2019

2020

2021

All Shiseido Group

53.9

54.8

52.7

57.51

Japan2 (Target: To achieve 50%)

25.1

32.3

33.1

34.7

Period: As of January 1 each year in Japan and as of December 31 of the previous year outside Japan.
Scope: Shiseido Group in Japan (23 companies).
1

Ratio of female junior managers in all Shiseido Group: 60.6%.

2

Leaders: Manager position holders and annual salary system employees.

Indicator

1

Ratio of Employees with Disabilities: Physically and intellectually disabled persons are included, and the employment rate for disabled persons is indicated by three significant figures.

2

Shiseido Group in Japan: 10 special subsidiary companies of Shiseido Group.

Top Message

Environment

Society

CultureGovernance

Annex

Data marked with

LTIFR1

Shiseido Groupoutside Japan

2017

2018

2019

2020

Directly hired employees

0.59

0.73

0.87

0.772

Coverage (%)

100

92.1

100

100

Indirectly hired employees

–

0

0

2.56

Coverage (%)

–

38.8

39.6

79.5

Directly hired employees

–

–

–

1.6

Coverage (%)

–

–

–

100

1

Lost Time Injury Frequency Rate (LTIFR) = Number of work-related accidents/Total hours worked x 1,000,000.

2

Scope: Shiseido Group in Japan (22 companies).

2018

2019

2020

2021

Shiseido Group in Japan (coverage 100%)

26.3

29.4

29.4

29.4

Shiseido Group outside Japan1 (coverage 100%)

68.4

68.4

68.4

68.4

Including work council.

ShiseidoGroupin Japan1

2018

2019

2020

210

563

432

210

562

394

1

0.37

38

324

687

1,243

Donations made in cash

311

673

1,080

Donations made by product offerings

13

14

163

Spending on donations
Breakdown

Donations made in cash
Donations made by product offerings

Spending on donations
All Shiseido
Group

BreakdownShiseido Group in Japan: Shiseido Company, Limited and 19 domestic affiliated companies subject to consolidation (as of December 31, 2020).

Editorial Policy

Indicator

Period: As of January 1 each year.

Indicator

1

Percentage of Corporations with Labor Union (%)

1

has been third-party certified.

Spending on Social Contribution Activities (millions of Japanese Yen)

Indicator

ShiseidoGroupin Japan

57

The Sustainability Report is edited according to the following policy.
• We report the activities that lead to the solution of social issues and the role that we play in a sustainable society.
We explain how we create social value that we provide as a company to various stakeholders.
• Scope: Based on Shiseido Company, Limited and the Shiseido Group (79 consolidated companies,
as of December 31, 2020).
• Target period: Mainly fiscal 2020 (from January 1, 2020 to December 31, 2020). Some data includes content which
is prior to the target period or is more recent.
• Our sustainability initiatives are also disclosed in our Integrated Report.
• Some environmental and social data are third-party certified, which is marked with for environmental data
and for social data.
• Assurance Statement— for Environmental Data
— for Social Data

Shiseido Company, Limited
7-5-5, Ginza, Chuo-ku, Tokyo, Japan+81-(0)3-3572-5111
corp.shiseido.com/en/

Published by Social Value Creation Division,
Shiseido Co., Ltd.
Design and production by Kontrapunkt with
Creative Division, Shiseido Co., Ltd.