Identified Material Issues and 2030 Targets

The TS TECH Group has established sustainability targets for 2030 with indices indicating the vision the Groupaims to achieve for itself by that year. We will address key material issues (materiality) in a priority manner to help
build a sustainable world. Under our 15th Medium-Term Management Plan (fiscal 2024–2026), we will execute ourmanagement policy of “realizing ESG management,” moving forward boldly to achieve our targets.

TS TECH Materiality Identification Policy• Issues that are material to the vision statement under the TS TECH Philosophy: “A company dedicated to realizing people’spotential” and “A company sincerely appreciated by all”
• Issues that are highly material to the United Nations Sustainable Development Goals (SDGs)• Issues that are material to contribute to a sustainable world

Category

Society

Environment

RelatedSDGs

Material issues

Providing attractive,
innovative new products
and technologies thatexceed society’sexpectations

Reducing impact
by practicing
environmentally friendlymanufacturing to build
a sustainable world

VisionMateriality

Developing attractive,• We will create new value that exceedsinnovative technologies
the expectations of customers and help
to build safe, secure, and prosperous
societies by providing attractive,
Improving producthigh-quality automobile interiors.
quality• Aiming for a decarbonized society, we
will work to contribute to reducing ourenvironmental impact by pursuingenergy savings and effective use ofresources, starting with product designand continuing throughout every stageof the product life cycle.
• We will strive to ensure that all of
our employees have a high level ofenvironmental awareness, whileworking to protect the environmentand conserve ecosystems based on theconcept of “giving greenery back tothe earth.”

Responding toclimate change

Recycling and effectively
using resources

Harmoniously
co-existingwith nature

Materiality KPIs
Innovative technology development
expenses as a percentage of R&D
expenses

Seat supplier IQS rating*1

Corporate
foundation

Respecting diversityand developing
structures to maximize
individual abilities• We will engage in diversity-positive,
Reforming work styles
highly transparent management toto make the most offulfill our corporate social responsibility
diversity(CSR), achieve sustainable businessgrowth, and enhance corporate value.
Strengthening
governance

TS TECH Integrated Report 2023

Based on international standards and guidelines such as the GRI Standards and the core subjects ofISO 26000, we studied identification methods.

Identification and organization of issues

We identified the risks and opportunities based on the Group’s business environment and ultimately
identified and organized the relevant issues.

Prioritizing of issues

Issues were evaluated and prioritized in terms of their importance to stakeholders and their importance to the TS TECH Group.

Consultations with outside experts

We exchanged opinions with outside experts on the issues identified to verify their scope and validity.

Selection of materiality

Out of 24 items, eight material issues were selected to be addressed by the TS TECH Group.

Approval by management

Following approval by the Executive Committee, the eight material issues were submitted to the Boardof Directors for discussion and approved.

14th Medium-Term
Management Plan results

vs. FY2021 +2.6%

15th Medium-Term
Management Plan targets

vs. FY2021 +3%2030 targets

Main measures

vs. FY2021 +10%

• Proactively investing in original technologies, including
biosensing and environmental technologies• Enhancing product quality with higher-precisionverification tools• Constructing a framework enabling ongoing cultivationof quality human resources worldwide

7.0P

2.0P (stable high levels)

CO₂ emissions reduction rate*2

vs. FY2020 -16%

vs. FY2020 -25%

vs. FY2020 -50%

Waste reduction rate*3

vs. FY2020 -16%
(Total)vs. FY2020 -25%

vs. FY2020 -50%

• Improving development and manufacturing efficiency• Developing and promoting products that use plant-based
raw materials, etc.
pp. 24–27• Analyzing and responding to risks and opportunities
based on the recommendations of the TCFD
pp. 39–41• Conducting energy management based on ISO 14001/ISO 50001• Installing energy-saving and renewable-energy
equipment
pp. 42–43

Water intake reduction rate andenvironmental impact fromwastewater*4

vs. FY2020 -13%(Total)

vs. FY2020 -15%

vs. FY2020 -50%“0” environmental impact

Establishment of the TS TECH Fund(matching gift program)

Program survey
Study of plans

Establishing a TS TECH Group
donation program

Establishing a TS TECH Group
donation program• Researching and establishing a matching gift program

CBBAAA• A nalyzing survey findings individually by department andidentifying priority issues• E nhancing the evaluation system and communication
opportunities
p. 51

97%
(Subject: 126 domesticsuppliers)

100%(Subject: Domestic andinternational suppliers)

100%(Subject: Domestic andinternational suppliers)• P reparing to expand surveys to verify circumstances ofcompliance to locations outside Japan
pp. 47–49

Percentage of management positions
held by diverse human resources*732.5%

33.3%

35%

• S upporting career development with rank-specific training•H elping personnel balance their work and personal lives(childbirth, childcare, nursing care)p. 50

Corporate Governance Codecompliance rate

100%

100%

100%

• Pursuing ongoing efforts to prevent corruption

Supplier Sustainability Guidelines
compliance rate*6*1 Rating awarded in the Initial Quality Study (IQS) conducted by J.D. Power Japan, Inc. The study looks at new car buyers and their experiences with any problems and calculates the number ofproblems indicated per 100 vehicles. The lower the number, the higher the quality.
*2 CO₂ emissions reduction rate (Scope 1 and 2) resulting from the Group’s business activities*3 Rate of reduction of waste (excluding residue, sludge, etc.) resulting from the Group’s manufacturing activities

12Surveys

8.8P

Engagement rating*5• We will respect the human rights ofRespecting humanall stakeholders and offer rewarding
rightsworking environments in which each andevery employee makes the most of theirdiverse talents.

Procedure for Identifying Material Issues*4 Reduction rate in water intake (amount used) at the Group’s production facilities and environmental impact of wastewater resulting from manufacturing activities*5 The engagement targets look at the company’s employees using Link and Motivation Inc.’s Motivation Cloud. The target “AAA” rating is the highest of the 11 ratings.
*6 Rate of compliance with the Supplier Sustainability Guidelines among the Group’s suppliers (including overseas suppliers)*7 Percentage of women, mid-career hires, non-Japanese citizens, older employees, and persons with disabilities in management positions

TS TECH Integrated Report 2023

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