CORPORATE REPORT 2020

CONTENTS

Editorial policy
Message2

2019–2020 Topics

3

5 Highlights

published a stand-alone CSR Report. Since FY 2013,
Zeon has published a booklet form of the CSR Reportrenamed the Corporate Report, which includes anannual report and corporate profile providing ofHighlight 1

The Zeon Group’s Response to COVID-19,
and the Impact of the Epidemic

Zeon Corporation and Zeon Group (“Zeon”) previously

overview of Zeon’s general business activities.

5

Highlight 2

In this FY 2020 version of the Corporate Report, theHighlight 1 section outlines the Zeon Group’s response
to COVID-19, and the impact of the epidemic. Highlight

Cyclo Olefin Polymers, specialty
materials creating the future

7

Zeon material and products
making contributions to society

9Company Profile

11

Zeon Group History

13

Business Overview

15

Zeon Group Locations

17

23 Zeon’s Business and Strategy
Interview with the President

24

Elastomer Business

27

Specialty Materials Business29

Research and Development (R&D)

31

Corporate Governance33

Directors and Officers

35

2 introduces Zeon’s plastic business utilizing Cyclo
Olefin Polymers (COP), a segment in our Specialty
Materials Business experiencing long-term growth. The
CSR Matrix is presented in summary form; the fullversion can now be found in Zeon’s CSR Report.

Reporting period
April 2019 to March 2020
(includes some information after April 2020)

Reporting scope
Zeon Corporation and Zeon Group companies insideand outside Japan. Some data covers only Zeon
Corporation.

Zeon’s information disclosure
Basic information on Zeon Corporation and Zeon Group is

37 Zeon’s CSR

available on the Company Information section of thecorporate website.

Zeon’s CSR

38

CSR Implementation Plan

39

Environment

41

Human Rights/Fair Operating Practices 42
Labor Practices

43

Community

45

This Corporate Report (booklet) contains a wide range
of information on Zeon corporate management and CSR.
A CSR Report (PDF) with detailed information on
initiatives and site reports is available on the CSR
activities section of the corporate website.
More information about Zeon’s management andoperations is available on the Investor Relations section of
the corporate website and in the Fact Book.

Website ▶ http://www.zeon.co.jp/index_e.html
Survey about this Corporate Report

URL ▶ http://www.zeon.co.jp/contact_e/index.html

1

ZEON GROUPCORPORATE REPORT 2020

Corporate Philosophy

Zeon is contributing to the preservation of the
Earth and the prosperity of the human race
Zeon, with its name drawn from words signifying the Earth (geo) andeternity (eon), is committed to responsible stewardship of the global
environment as the foundation for human prosperity through thedevelopment and application of unique, world-leading technologies.

Enterprise Blueprint for 2020

Zeon makes the Future Today through the Power of Chemistry
Zeon will continue to contribute to the realization of customer dreams
and a prosperous society through employees’ individual growth.

WebsiteGet to know Zeon’s special website! 2020
We broadcast TV
commercials in someregions of Japan,
focusing in particularon those regions
where Zeon plants arelocated, and we also
operate a special
website where Zeon
employees introduce
the kind of work theydo.

Company Information

CSR Activities

IR Information
CSR Report

Corporate Report

Fact Book

ZEON GROUPCORPORATE REPORT 20202

2019–2020 Topics

The following summarizes Zeon’s major business developments from June 2019 through August 2020.
See the related press releases for more detailed information.

Organization/Business

Decided to increase production capacity for Cyclo
Olefin Polymers (COP)

Completed a new production line to manufacture opticalfilm for large-sized TVs at the Tsuruga Plant of Optes Inc.

Zeon Corporation made the decision to increase production capacity for Cyclo
Olefin Polymers (COP), a type of specialty plastics, at the Mizushima Plant.
Demand for ZEONEX® and ZEONOR®, which are made using COP, has been
growing in applications such as LCD TVs, smartphones, medical containers,
etc., and is expected to continue growing in the future.
Annual production volume is forecast to increase from 37,000 tons at present
to 41,600 tons. Related construction work is due to begin in FY 2020 and becompleted in July 2021.

In January 2020, Optes Inc. completed a new production line forthe manufacturing of retardation film for use in large-sized TVs, at
its optical film plant in Tsuruga City, Fukui Prefecture.
Full-scale operation of the new production line began in April 2020.
ZeonorFilm® has superior optical properties and outstanding
dimensional stability, and the new production line will help to meetgrowing demand resulting from the trend towards ever larger
display size.
Optes has also increased its extruded film production capacity at its
Takaoka Plant.

Absorbed TFC Inc.
TFC Inc. was a wholly-owned subsidiary of Zeon Corporation,
specializing in the manufacturing of LCD components such as
optical films, etc. On April 1, 2020, TFC was merged into Zeon
Corporation, with the aim of realizing a further enhancement of
product quality and of strengthening competitiveness.

R&D

Zeon Medical Inc. invested in a medical device venture fundZeon Medical Inc., which has been developing its medical
device business, invested 500 million yen in a fund establishedby MedVenture Partners Inc., a venture capital firm specializing
in investment in the medical devices sector. Through thisinvestment, Zeon Medical aims to expand its business portfolio
by collecting information, and by identifying projects tocollaborate on and opportunities for direct investment.

Zeon Corporation expressed its support for the TCFD

（regarding disclosure in relation to climate-related risks and opportunities）
In August 2020, Zeon Corporation expressed its support for therecommendations made by the Task Force on Climate-related
Financial Disclosures (TCFD). In the future, Zeon Corporation will
implement disclosure and announcements in line with the TCFD
recommendations, and will also be strengthening its initiatives
aimed at making a positive contribution towards the realization of asustainable society that can create a “virtuous circle” in relation to theenvironment and growth.
Zeon Corporation has also joined the Japan TCFD Consortium. Asa member of the TCFD Consortium, Zeon Corporation works topromote various initiatives together with other corporations, financial
institutions etc. that
also support the TCFD
recommendations, andengages in dialog anddiscussion regarding
effective disclosure.

3

ZEON GROUPCORPORATE REPORT 2020

Presented a paper at an academic conference
on the low adsorptivity of the protein in COP for
pharmaceutical use
In October 2019, Zeon Corporation presented a paper on thestability of pre-filled syringe agents in the biomedical products
sector at the Universe of Pre-filled Syringes and Injection
Devices, an academic conference held in Sweden.
In addition, in May 2019 Zeon Corporation gave a technicalpresentation for the U.S. Food and Drug Administration (FDA)
on the utilization of COP as a material for pre-filled syringes.
COP is characterized by very low levels of protein adsorption
and binding, and as such is attracting a great deal of interest asa packaging material in the biomedical products sector.

New Products

Launched a new electron beam resist for nextgeneration electronics components
In August 2019, Zeon Corporation launched the ZEP530A
series, a new grade of resist. By comparison with existing resist
grades, ZEP530A provides superior dry etching resistance,along with enhanced resolution and an improved process
window. ZEP530A will make a significant positive contribution
to the manufacturing of the next-generation electronics
components needed for 5G mobile communications.

Commercialized a solar card type lamp
In June 2019, Zeon Corporation successfully commercializeda rechargeable lamp that uses a solar card (a polycarbonate
card with a photovoltaic cell built into it) made using carbon
nanotubes, developed through the Project LNES open
innovation project.

Commendations

Received the Excellence Award in the Electronic Materials
for Semiconductors category at the 2020 Semiconductor of
the Year Award for a positive electron beam resist designed
for use with next-generation electronics components
In June 2020, Zeon Corporation received the Excellence Awardat the 2020 Semiconductor of the Year Award, organized byElectronic Device Industry News (Publisher: Sangyo Times Inc.),
for the contribution made to the development of thesemiconductor sector by the superior performance of Zeon
Corporation’s ZEP530A electron beam resist.

Received the Technology Award from the 2020
Adhesion Society of Japan for asymmetric SIS(styrene-isoprene-styrene triblock copolymer)
research achievements
In June 2020, Zeon Corporation received the Technology Award
from the Adhesion Society of Japan in recognition of several
research results relating to adhesive label applications for Zeon
Corporation’s independently developed asymmetric SIS.

ZEON GROUPCORPORATE REPORT 20204

Highlight 1

The Zeon group’s response to COVID-19,
and the impact of the epidemic
The measures taken by the Zeon Group in response to the COVID-19 coronavirus epidemic,
and the impact that the epidemic has had by May 2020, are summarized below.

Impact on FY 2019 results(financial results for the accounting period ending March 31, 2020)

Despite the constraints on economic activity throughout the world, because it takes some time for the
impact on sales to be felt, COVID-19 did not have a significant impact on performance in FY 2019.

Factory operation status
The Zeon Group has production facilities in three locations in China: Shanghai City, Guangzhou City, and Changshu
City. Production was suspended for a short period, but the factories began operating again starting from February
10, and operations are now back to normal.
Factories in regions outside China implemented infection prevention measures, and were able to maintain more orless normal operation right from the early stages of the pandemic.
With regard to the issuing of orders to suspend operations by government authorities, the Zeon facility in Singapore
was allowed to continue operating even during lockdown, as it was classed as belonging to a key economic sector.

Zeon Chemicals L.P.

Zeon Advanced Polymix Co., Ltd.

Zeon Chemicals (Thailand) Co.,Ltd.

Zeon Chemicals Singapore Pte. Ltd.

Impact on businessWith a global economic downturn forecast, the need to respond to the COVID-19 and to changes inlifestyle habits was expected to have both positive and negative impacts on the Zeon Group’s business.
As a result of various factors such as automotive manufacturers being forced to suspend production, etc.,
the economic downturn was expected to have a substantial negative impact on the Elastomer Business. On
the other hand, demand for latex to make medical gloves has increased.
In the Specialty Materials Business, the impact on COP and films was projected to be limited. At the sametime, demand for battery materials was forecast to be negatively impacted by the situation in theautomotive sector.

Financing measures
To improve liquidity, in addition to our existing commercial paper issue of 50 billion yen, we have also
increased our planned commitment line to 50 billion yen. As of March 2020, Zeon’s liquidity ratio stood at
191%, and the cash plus marketable securities ratio was 1.2 months, so there was no cause for concern inregard to cash flow.

5

ZEON GROUPCORPORATE REPORT 2020

Group-wide response strategies
The Zeon Group established an emergency response headquarters at Zeon Corporation’s head office. The company
president has been serving as head of the emergency response headquarters, and has set up a committee in which thevarious department heads play key roles. Implementing intensive online communication, information from business locations
both within and outside Japan is aggregated at Zeon’s head office in a timely manner, while at the same time we haveencouraged the sharing of information between business locations, and have been implementing various response measures.
Starting from January 2020, we have been implementing speedy, appropriate countermeasures, focusing on thefollowing three areas:①Safeguarding the health and safety of employees and their family members, etc.
②Maintaining stable cash flow
③Maintaining our supply chain
Even after the lifting of the state of emergency in Japan, we extended Zeon’s Period of Special Measures for Infection
Prevention , and we have been implementing measures in line with the “New Lifestyle” proposed by the Ministry of Health,Labour and Welfare (MHLW) and the Guidelines for Preventing the Spread of Novel Coronavirus Disease (COVID-19)
formulated by the Japan Business Federation (Keidanren).

Safeguarding the health and safety of employees andtheir family members, etc.

●Measures taken at plants

As plants cannot operate unless employees come in to the plant to work, we have taken
appropriate countermeasures that take account of the need for thorough infection
prevention measures.
In order that plant operation can continue even if an operative is found to have been
infected with COVID-19, we have been reviewing how shift work assignments areadjusted, etc. A message from the company president has been shown at plants, thanking
the employees for their efforts to maintain plant operation and encouraging them tokeep going.
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requiring employees to wear masks, encouraging employees to wash their hands frequently,
distributing face-shields, washing and disinfecting common areas, efforts to optimize
cafeteria operation (including establishment of staggered meal times, installation of partition screens, maintaining
sufficient distance between diners, etc.), ensuring good ventilation within the facility, discouraging or prohibiting businesstravel outside the facility, meetings and business entertaining, etc., implementation of awareness-raising activities andinformation-sharing for employees, asking external parties to collaborate on infection-prevention measures, etc.
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* Starting from June 15, in order to prevent heatstroke, some of the rules on mask-wearing were relaxed, provided that employees canmaintain a sufficient distance from other people.

●Measures taken in offices
At Zeon Corporation’s head office, as of April 2020, 95% of employees were working from home. We have also been
taking thorough prevention measures with respect to employees working at our other offices in Japan and worldwide,
including having employees work from home. In addition, the company president had encouraged employees throughout
the world to maintain their efforts and take care of their health with video and letter messages.
■Infection prevention measures
Measures taken include working from home, introduction of staggered working hours, postponing or cancellation of
special events, prohibition of overseas business trips, restrictions on domestic business trips, arranging for employees on
assignment overseas to return home, provision of support for overseas business locations from company head office,encouraging employees to stay at home on weekends and public holidays, suspension of reception and main switchboard
operations at head office (relaunched starting from June 1), etc.
* Starting from June 15, in order to prevent heatstroke, some of the rules on mask-wearing were relaxed, provided that employees canmaintain a sufficient distance from other people.

Maintaining our supply chain

As noted above, manufacturing plans both in Japan and overseas have been able to continue operating more or lessnormally, while implementing thorough infection prevention measures.
We have also been implementing thorough infection prevention measures at our overseas sales bases, continuingbusiness operations in line with conditions at our business partners and elsewhere.

ZEON GROUPCORPORATE REPORT 20206

Highlight 2 Zeon Products Making Contributions to Society

Cyclo Olefin Polymers, specialty
materials creating the futureSelf-driving

COP

5G communication

Zeon’s original COP developed ahead of the world
Zeon’s Cyclo Olefin Polymers (COP) have excellent optical and chemical properties. Under the product names ZEONEX®
and ZEONOR®, they are widely used in optical films and lenses, medical and biotechnology applications while earning highly
favorable reviews. The FY 2019 business scale of the Specialty Plastics Business came to 56.8 billion yen in net sales.
Currently, the optical film business for LCD and OLED panels for TVs and smartphones takes a large share of the COP
business. COP’s characteristics are not only applicable to optical films; they also have potential for application in a wide
range of usage settings including the medical applications outlined in our 2019 Corporate Report.
Here we introduce the use of COP in electronic devices.
2019 Corporate Report▶http://www.zeon.co.jp/csr_e/report.html●Characteristics of Zeon’s COP that improve the performance of electronic devices
Low water absorbency(high-intensity)

COP is hydrolysis-resistant and able to maintain strength long term.

Low outgassing

COP undergoes very little degassing of volatile components from resin.

High chemical
inertness

COP demonstrates excellent resistance to acid, alkali and alcohol.

Low dielectric loss

COP experiences little transmission loss in high-frequency ranges.

Excellent electric
insulation

COP offers high dielectric breakdown strength, effective at miniaturization andimproving the durability of electronic components.

High processability/
precision moldability
Strong environmental
performance

7

ZEON GROUPCORPORATE REPORT 2020

COP is easily processable into films and molded goods, and processing
technology is also available.
COP offers good dimensional stability, and is also suitable for precision molding.
COP does not produce hazardous substances even when incinerated (only CO2 and water).

Zeon’s COP making contributions to self-driving cars and 5G communication
Many new electronic devices will be developed to performsensing, communication, and information processing in the
self-driving car and 5G communication fields, whose markets
are forecast to expand in the near future.
Our COP is able to meet needs for the advanced functions
required in these new fields.

As a film antenna substrate
Self-driving cars and mobile 5G communication are
projected to involve a larger amount of informationtransmission. Our COP offers low dielectric loss with highinformation density and extremely low electric signal loss,
making it ideal for use as a communication antenna substrate.
It is also highly bendable as a substrate and will not breakeven if bent, with anticipated application also as a film
antenna attached to vehicle windshields.
COP used in films for LCDs also has potential for use inapplications involving large data transmission while
maintaining the field of vision, making it ideal for use inmobile 5G communication as well.

As a sensing camera lens
The lenses of sensing cameras, which serve as the “eyes”
in collision avoidance systems and drive recorders, need to
be transparent and offer excellent precision molding
properties. Our COP products have been adopted in manylenses for smartphone cameras to date. In self-driving cars,
which are forecast to see market expansion, even morecamera lenses are predicted to be used to monitor thevehicle surroundings.

L-24, a new high-temperature resistant COP, and semiconductor containers

heat resistance（℃）

COP materials in the past Highhave offered heat resistanceto approximately 160℃.
However, the new L-24
(development code) material
we developed achieves greatly
improved heat resistance witha melting point of 265℃
thanks to added crystallinity.
To obtain the heat
resistance and bendable
properties required forcommunication applications,
we improved the molecular
design of the resin using ouroriginal technology, resulting
in the creation of a brand-new
crystalline COP material.
Low

250

200

Melting point: 265℃

L-24

150

100

ZEONEX®
ZEONOR®

50

PP

A lot of fluorine resins are used in conventional semiconductor manufacturing.
Fluorine resins exhibit high heat resistance and chemical inertness, but thematerials are heavy and expensive, greenhouse gases are produced during
manufacturing, and toxic gas is emitted during incineration, which has given riseto needs for alternative materials.
Our COP is increasingly being
used in semiconductor containersthat store disc-shaped wafers insemiconductor processes, due to its
high degree of chemical inertness,
low water absorbency, lowoutgassing, and low environmental
impact during incineration.
In addition, L-24 offers
improved heat resistance, leading
to gains in semiconductor
Semiconductor container using COP productivity, and therefore is a(stores and mechanically transports
promising new material.
tens of 300mm–450mm
disc-shaped wafers)

ZEON GROUPCORPORATE REPORT 2020

8

Zeon Products Making Contributions to Society

Zeon material and products
making contributions to society
Zeon has defined the key development areas of Global Environment, Health and Living, and Smart
Devices, and is engaging in new business creation and new product development.

Contributions to the SDGs across all products

Zeon is working to reduce the environmental load of all products during
product manufacturing and use (Goal 12), and aims to contribute tosocietal development and technological innovation through product use(Goal 9).

Energy conservation

GlobalEnvironment

Reduction of fossil fuel use

ZEORORA® H Fluorinated solvent:Contributes to climate change prevention as analternative HFC solvent.
ZEORORA® Etching gas for oxide layers:
Contributes to climate change prevention as an
etching gas with low global warming potential.

ZEON GROUPCORPORATE REPORT 2020

Power generation
Automotive

Improved performance and extended life of manufacturers’ products
made with Zeon’s materials and components contribute to reducing
environmental impacts through such ways as energy conservation,
mitigating climate change, and reducing waste.

Solution-polymerized
styrene-butadiene
rubber (S-SBR):
Improves theperformance of
fuel-efficient tires andcontributes to energy
conservation andreduced CO2 emissions.

9Batteries

Zetpol® specialty
cross-linked hydrogenatednitrile rubber (HNBR):
Developed a proprietary
method to add specialty
cross-linking to nitrile rubberhydrogenated to increase heat
resistance to improve therubber’s durability(compression set) and achieveboth durability and heat
resistance.
Asia Technical Support Laboratory (ATSL):
Based in Singapore, ATSL provides technical support in such areas as
blending, kneading, and physical property evaluations of rubbers madewith locally available agents for Asian rubber manufacturers. ATSL isenhancing Zeon’s presence in Asian markets using the technologicalstrengths Zeon has built up in the United States, Europe, and Japan.

Energy materials:
Zeon’s binders prevent electrode volume expansion
and greatly improve cell life. They also increase thechemical reactions on the surface of the active
materials to increase battery output.

Self-driving cars

Health and
LivingMedical devices

Medical materials
Daily necessities

Agriculture

Zeon’s materials, components, and products are useful in daily life andcontribute to health and well-being of people.

Prohydrojasmon plant growth regulator:
Reduces declines in the production volume
and quality of agricultural products due tothe effects of climate change(Jasmomate TM Ekizai agrochemical
formulation).

Synthetic latex forgloves:Due to concern
about allergic
reactions from natural rubber proteins, demand is
shifting to NBR latex gloves, and the market isexpanding.

Cyclo Olefin Polymers(COP) for onboard
sensing cameras:
ZEONEX® offers
excellent opticalproperties and stable chemical properties, resulting in its
adoption not only in smartphone cameras but also in onboard
sensing cameras in automotive hazard detection systems.

Microfluid chip
prototyping service:
Microfluid chips thatuse microprocessing
technology to form microchannels and reaction chambers arewidely used in medical fields including pharmaceuticals andin-vitro diagnostics. One stop service is also available, frommolding to cutting and joining, and able to flexibly support
orders from one piece to mass-production.

Thermoplastic
elastomer SIS:
Used in elastic film fordisposable diapers toachieve lighter weight andgreater comfort.

Catheters to remove bile
duct stones:
Zeon’s catheters help lessen
patients’ pain and healthcare
professionals’ workloads, with astrong reputation in treatment
to remove bile duct stones.

Smart
Devices

IoT

Using Zeon’s materials
and components cangreatly improve
product performance.

ZeonorFilm® Optical film:
ZeonorFilm® optical film contributes toimproved display performance by combining
ZEONOR® resin properties includingtransparency and low water absorption with
our world-first sheet extrusion process, film
stretching technology, and other film
processing technologies.

Pad-type thermal interface material(TIM):TIM using rubber/single-walled carbon
nanotube (ZEONANO®) composite
achieves low thermal resistance.
It increases the thermal conductivity of theheat sink and resolves the heat generation
problem of servers and power devices.

ZEON GROUPCORPORATE REPORT 202010

Company Profile

Name: Zeon Corporation

Established: April 12, 1950
Capital: 24.211 billion yen (as of March 31, 2020)
Market capitalization: 192.9 billion yen (as of March 31, 2020)
Total number of shares outstanding: 237,075,556 shares
Employees: 3,462 (consolidated)
1,600 (non-consolidated) (as of March 31, 2020)
Business segments: Elastomer Business, Specialty Materials
Business, other businesses (➡P. 15)
Head Office: Shin Marunouchi Center Building, 1-6-2
Marunouchi, Chiyoda-ku, Tokyo 100-8246, Japan
Plants: Takaoka Plant, Kawasaki Plant,
Tokuyama Plant, Mizushima Plant
Research laboratories: R&D Center (Kawasaki)
Offices: Osaka Office, Nagoya Office

Consolidated net sales(million JPY)

350,000
300,000

295,647

287,624

2015

2016

332,682

337,499 321,966

2017

2018

250,000
200,000
150,000
100,000
50,00002019 (FY)

Subsidiaries and affiliates in Japan (➡P. 21)：
Tokyo Zairyo Co., Ltd., Zeon Kasei Co., Ltd.,
Zeon North Co., Ltd., Zeon Yamaguchi Co., Ltd.,
Zeon F&B Co., Ltd., Zeon Chemicals Yonezawa Co., Ltd.,RIMTEC Corporation, Zeon RIM Co., Ltd.,
Zeon Medical Inc., Optes Inc., Zeon Opto Bio Lab Co., Ltd.,
Zeon Polymix Inc., Tohpe Corporation,
Zeon Nano Technology Co., Ltd., ZS Elastomers Co., Ltd.,
Okayama Butadiene Co., Ltd., ZIS Information Technology Co., Ltd.

Subsidiaries and affiliates outside Japan (➡P. 17, 19)：

【USA】Zeon Chemicals L.P., Zeon Specialty Materials lnc.,

Tokyo Zairyo (U.S.A.) Inc.
【Brazil】Zeon do Brasil Ltda.

【Mexico】Zeon Kasei Mexico S.A. de C.V.,

Tokyo Zairyo México, S.A. de C.V.
【Europe】Zeon Europe GmbH, Telene S.A.S.,

Consolidated operating income(million JPY)

50,00038,88140,00030,00029,85630,7672015

2016

33,147

26,10420,00010,000
0

2017

2018

2019 (FY)Tokyo Zairyo Czech, s.r.o.
【China】Zeon (Shanghai) Co., Ltd., Zeon Trading (Shanghai) Co., Ltd.,

Shanghai Zeon Co., Ltd., Zeon Polymix (Guangzhou) Co., Ltd.,
Takehara Zeon (Shanghai) Co., Ltd., Zeon Kasei (Changshu) Co., Ltd.,
Zeon Medical (Guangzhou) Inc., Tokyo Zairyo (Shanghai) Co., Ltd.,Tokyo Zairyo (Tianjin) Co., Ltd., Tokyo Zairyo (Guangzhou) Co., Ltd.

Segment net sales (outer circle) and operating income (inner circle)【South Korea】Zeon Korea Co., Ltd., Zeon Shinhwa (Zeshin) Inc.
【Taiwan】Zeon CSC Corporation, Zeon Taiwan Co., Ltd.
【Singapore】Zeon Chemicals Singapore Pte. Ltd.,

Zeon Asia Pte. Ltd., Tokyo Zairyo (Singapore) Pte. Ltd.

Other Businesses

17%

7%

【Malaysia】Zeon Asia Malaysia Sdn. Bhd.

33%

【India】Zeon India Private Limited,Tokyo Zairyo (India) Pvt, Ltd.
【Thailand】Zeon Chemicals (Thailand) Co., Ltd.,

Zeon Advanced Polymix Co., Ltd.,Tokyo Zairyo (Thailand) Co., Ltd.
【Vietnam】Zeon Manufacturing Vietnam Co., Ltd.,

Zeon Research Vietnam Co., Ltd.,Tokyo Zairyo (Vietnam) LLC.
【Indonesia】PT. Tokyo Zairyo Indonesia

11

ZEON GROUPCORPORATE REPORT 2020

FY

Specialty Materials
Business

28%

2019
60%

Elastomer Business55%

Shareholder information (as of March 31, 2020)

Dividends(JPY)

Treasury stock

20

7.8%

Financial institutions &securities companies(18,515,000 shares)
Individuals & others

8.4%(19,838,000 shares)
Foreign investors

21.2%

36.0%

237,075,556
shares100%(50,377,000 shares)(85,313,000 shares)

15

15

16

17

19

21

10
Other domestic
institutional investors

5

26.6%

(63,030,000 shares)

Share price (closing price on March 31)

4,000

1,538

1,500

1,271

2,000

814

728

2015

2016

2017

2018

2019 (FY)20182019 (FY)

0.90
0.85

0.91

2,655

1,000

0

2015

2016

2017

2018

2019 (FY)

CO2 emissions (including Zeon Group inside and outside Japan)
900

0.95

0.93

800
700

724

770

737

687

2017

2018

2019 (FY)

655

600

0.86

0.85
0.80

1,929

1,725

(1,000 tons)(crude oil equivalent, kL /million JPY)

1.05
1.00

0.95

3,013

1,120

Energy use per net sales (Zeon Group inside and outside Japan)

0.95
0.90

2017

3,646

3,000

1,000

1.00
0.95

2016

(100 million JPY)

(JPY)

0

2015

Market capitalization (as of March 31)

2,000

500

0

500
400

0.80
0.75

300

0.75
0.70

200
100

0

2015

2016

2017

2018

2019 (FY)

0

2015

2016

ZEON GROUPCORPORATE REPORT 2020

12

Zeon Group HistoryW‌ orld-leading C4 and C5 technologies with GPB and GPIprocesses
In the petrochemical industry, which uses crude oil as araw material, technological capabilities are a key element
impacting company competitiveness. Zeon developed the
GPB process in 1965 to efficiently extract high-grade
butadiene, which is the raw material used in synthetic rubber
production, from C4 fractions. In 1971, Zeon developed the
GPI process to efficiently extract isoprene, the raw material in
isoprene rubber, and other useful components, from C5
fractions.
Zeon licenses its proprietary GPB process technology incountries around the world. This greatly contributes to Zeon’scompetitive edge and promotes the Zeon brand globally.

Starting from PVC and synthetic rubber production
Zeon Corporation was founded as a PVC manufacturer in
1950, established with capital from three Furukawa groupcompanies—Furukawa Electric, Yokohama Rubber, andNippon Light Metal. Zeon acquired its PVC manufacturing
technologies from U.S.-based B.F. Goodrich Chemical
Company, which at the time was the global leader in theindustry. Zeon continued developing the PVC business fromits founding until full withdrawal in 2000.
In 1959, Zeon acquired technologies from B.F. Goodrich
Chemical Company to operate a specialty synthetic rubber(NBR) plant. This was Japan’s first domestic synthetic rubber
plant. Following this, Zeon embarked on the production ofgeneral-purpose synthetic rubber (SBR). Zeon thus
established its Synthetic Rubber Business for tires and engine
components, which it continues to manufacture today.

Timeline of main businesses
and product development

1960

1970

1980

Processed
Products
Polyvinyl chloride resins

Medical
Devices

Latex(for paper coating)Powder slush compounds (PSC)

Ventricular assist device

VP latex(tire cord)

Specialty Synthetic Rubbers(NBR & ACM for auto parts)

&

1990

Hollow latex(paper coating)Hydrogenated NBR(Zetpol®)

Toner

Polymerized toner

Synthetic Rubbers for Tires(SBR & BR for tires)

General-purpose synthetic rubberwith modified terminals&C5 petroleum resin(roadmarking paints)

Chemicals

Isoprene rubber(tires)Specialty
Chemicals

Thermoplastic elastomer SIS(adhesives)

Synthetic aroma chemicals(leaf alcohol)

Synthetic aroma chemicals(jasmine aroma chemicals)
Fluorinated C5

Electronics Materials

Specialty Plastics
Dicyclopentadiene

Cyclo Olefin Polymers(lenses, prisms)

RIM
RIM molded items and formulation(large plastic products)

13

ZEON GROUPCORPORATE REPORT 2020

Developing comprehensive uses for C5 fractions
Isoprene rubber is a useful material that can stably achieve
the same properties as natural rubber. Many byproducts arederived from the process of extracting isoprene feedstockfrom C5 fractions. One advantage of the GPI process is theability to extract these byproducts at a high degree of purity.
Zeon has focused on ways to effectively use thesesubstances. As a result, Zeon subsequently grew its businessto include petroleum resins and thermoplastic elastomer SIS
in the 1980s, synthetic aroma chemicals and RIM molded
products in the 1990s, and Cyclo Olefin Polymers since the2000s. These businesses now enjoy a large share of the
global market. The technologies gained during thisdevelopment process are being used in other areas inaddition to C5 fractions.

Developing more advanced materials and establishingleading manufacturing technologies
In recent years, there has been growing demand for productswith advanced functions that can contribute towards solving social
issue, and similar expectations are rising for chemical materials.
To meet these expectations, Zeon’s Synthetic Rubber Businessdeveloped Zetpol® hydrogenated nitrile rubber, which provides
high functionality at a competitive cost and is used in automotiveengine components and other applications with severe working
conditions. Cyclo Olefin Polymers, developed from comprehensive
use of C5 fractions, are high-performance materials used in opticalfilms and lenses, and in electrical insulation.
Single-walled carbon nanotubes (SWCNT), in compounds with othermaterials such as rubber, are able to demonstrate novel properties andperformance. Zeon has become the first company in the world to use
the Super-Growth method for mass production of SWCNT.

2000

2010
Enhanced low-temperature PSC(automobile instrument panels)

PVC business withdrawal

Balloon catheters (IABP)

4 core catheter products Stents (bile ducts sheath)

NBR latex(gloves)

EnergyMaterials

Water-based anode Solvent-based cathodebinder for mobile LIB* binder for mobile LIB*LIB:
Lithium-ion batteries

Functional layerbinder for mobile LIB

Anode and functional
Water-based anodelayer binder forbinders for large-capacity
automobile LIB
mobile batteries

Water-based
cathode binders

Heat-resistant H-NBR (Zetpol®)Heat-resistant acrylic rubber

Polymerized color toner

Low-temperature fixing toner(high-speed printers)

Solution-SBR(fuel-efficient tires)Light-color petroleum resin(adhesives for diaper)

Asymmetric SIS(elastic film for diaper)

Cyclopentanone
Cyclopentyl methyl ether (CPME)(solvent and fine chemical raw material)(eco-friendly solvent)
Photo resists

Insulation materials

Cyclo Olefin Polymers(commodity use)

Optical Films

LCD resists for large sized wafers

Cyclo Olefin Polymers(blue laser)
Melt extrusion
process

Retardation films
by successive
stretching process

Retardation films
by diagonal
stretching process

High thermostability film
by diagonal stretching process(touch panels)

CNT

Super Growth Carbon Nanotube

ZEON GROUPCORPORATE REPORT 202014

Business Overview
Zeon’s main products are created from raw materials such as butadiene and isoprene, which are extracted from the C4 andC5 fractions of naphtha using proprietary Zeon technologies. Business segments are divided into the Elastomer Business,
Specialty Materials Business, and other businesses.

C2 fractions Ethylene
C3 fractions Propylene

Main Products
Synthetic rubbers

C4
fractions

GPB
process

Butadiene
Synthetic latexes

Synthetic rubbers

Crude oil

NaphthaIsoprene
Proprietary Zeon technology
used to extract highly purebutadiene from C 4 fractions

Thermoplastic
elastomers
Petroleum resins

Piperylene
Petroleum resins

C5
fractions

GPI
process

Dicyclopentadiene

RIM compound

Specialty plastics

2-butyne
Proprietary Zeon technology
used to extract isoprene andother highly-pure, usefulcomponents from C5 fractions

Synthetic aroma
chemicalsElectronics materials

Energy materials

Medical devices

Carbon nanotubes

15

ZEON GROUPCORPORATE REPORT 2020

Applications

Elastomer Business

Tires

Gloves for medical use
and food processing

Elastomer Business

Automobile
components

Cosmetic
puffs

Tires

Adhesives

Adhesives

In 1959, Zeon became thefirst company in Japan tomass-produce synthetic
rubbers. The Elastomer
Business is a core businessarea, providing over 50% of
total net sales and operating
income.
Main products
Synthetic rubbers, synthetic
latexes, chemical products(thermoplastic elastomers,
petroleum resins)

Traffic paints

Paints/coatings, Inks

Lenses

Large-size
molding

Toner

Binders for lithium-ion rechargeable batteriesSpecialty Materials Business

Food additives

Electronics materials

Specialty Materials
Business

Medicalcontainers

Optical films

Fragrances

Other

Housing equipment
and components

Medical catheters
Other

Single-walled carbon nanotubes,
Composite materials

Specialty materials refer tomaterials and components
with high added value thathave a macromolecular
design and are made withprocessing technology. The
three key business areas of
the Specialty Materials
Business are IT components,
energy materials, andmedical devices.
Main products
Specialty plastics andcomponents, electronics
materials, toners, battery
materials, medical devices

Social value created from C4 and C5

Automobile
components

Business Segments

P. 9

Other Businesses

Engineering, packaging
materials, building
materials, deodorants, RIM
formulation, single-walledcarbon nanotubes,
paints/coatings, trading, etc.

ZEON GROUPCORPORATE REPORT 2020

16

Zeon Group Locations

Asia

as of July 1, 2020

We are continuing to globalize ourbusiness since the 1970s.
We have set up sales networks inmajor markets around the world andestablished a production system forrubber and resin products. In
addition, we have R&D facilities in
the USA and Europe to meet the
local needs quickly. We are alsoestablishing R&D and sales locationsin China, a market that is growing
rapidly.
We are aiming to be a company
that, through our local production
systems, builds close ties with local
communities and contributes to theglobal society.

1 Zeon (Shanghai) Co., Ltd.
Room 1904, 2 Grand Gateway, No.3 Hongqiao Road, Xuhui
District, Shanghai, 200030, China
TEL: +86-21-6167-5776 FAX: +86-21-6040-7258• Provide assistance and exercise control over theZeon Group companies in China with regard to suchfunctions as accounting, finance, personnel management, legal, etc

1 Zeon Trading (Shanghai) Co., Ltd.

Room 1901-2, 2 Grand Gateway, No.3 Hongqiao Road,
Xuhui District, Shanghai, 200030, China
TEL: +86-21-6040-7255 FAX: +86-21-6040-7258• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

1 Shanghai Zeon Co., Ltd.
No. 380 Shennan Road, Xinzhuang Industry District,Minhang, Shanghai, 201108, China
TEL: +86-21-6489-6160 FAX: +86-21-6442-0569(Push “0” after announcements)• Manufacture and sales of rubber compounds (CM)

1 Takehara Zeon (Shanghai) Co., Ltd.

No. 380 Shennan Road, Xinzhuang Industrial Zone,
Minhang District, Shanghai, 201108, China• Manufacture and sales of silicon rubber compounds (CM)2 Tokyo Zairyo (Shanghai) Co., Ltd.
Room 1903, 2 Grand Gateway, No.3 Hongqiao Road,
Xuhui District, Shanghai, 200030, China
TEL: +86-21-6119-9400 FAX: +86-21-6119-9401• Purchase and sales of synthetic rubbers, chemical products,
etc. (including international trade)

2 Zeon Polymix (Guangzhou) Co., Ltd.
No. 1 1st Jingquan Road, Yong He Economic Zone,
Guangzhou, 511356, China
TEL: +86-20-3222-1171 FAX: +86-20-3222-1820• Manufacture and sales of rubber compounds (CM)

2 Zeon Medical (Guangzhou) Inc.
Room 1706A, Goldlion Digital Network Center, No. 138
Ti Yu Dong Road, Tianhe District, Guangzhou,
Guangdong, 510620, China
TEL: +86-20-2283-6788 FAX: +86-20-2283-6789• Sales, export, and import of medical devices(cardiovascular and endoscopic accessory, etc.)

2 Tokyo Zairyo (Guangzhou) Co., Ltd.
Room 1208, Goldlion Digital Network Center, No. 138 Ti yu
Dong Road, Tianhe District, Guangzhou, Guangdong,
510620, China
TEL: +86-20-3878-0671 FAX: +86-20-3878-1336• Purchase and sales of synthetic rubbers, chemical products,
etc. (including international trade)

For Japanese

4
5

3
1
7
2
11

8
12

9
10

13

17

ZEON GROUPCORPORATE REPORT 2020

6

➡ locations, see
P. 21

3 Zeon Kasei (Changshu) Co., Ltd.
Huangpujiang Road 96, Dongnankaifa District,
Changshu City, Jiangsu Province, 215500, China
TEL: +86-512-5235-7000 FAX: +86-512-5235-7308• Manufacture and sales of powder slush compounds

8 Zeon Chemicals (Thailand) Co., Ltd.
3 Soi G-14, Pakorn-Songkhrorad Road, Tambol Huaypong,
Amphur Muangrayong, Rayong 21150, Thailand
TEL:+66-3-868-5973~5 FAX:+66-3-868-5972• Manufacture and sales of petroleum resins

4 Tokyo Zairyo (Tianjin) Co., Ltd.

8 Zeon Advanced Polymix Co., Ltd.

Room 1805, The Exchange Tower 1, 189 Nanjing Road,
Heping District, Tianjin, 300051, China
TEL: +86-22-23021268 FAX: +86-22-23021278• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

111/2 Soi Nikom 13, Moo 2 T.Makhamkhoo, Nikompattana
District Rayong 21180, Thailand
TEL:+66-38-893-565 FAX:+66-38-893-569• Manufacture and sales of rubber compounds (CM)8 Sales office

5 Zeon Korea Co., Ltd.

591 UBCII BLDG, Office No.2206, 22thFL, Sukhumvit
33rd, KlongtonNua, Wattana, Bangkok 10110, Thailand
TEL:+66-2-261-0175 FAX:+66-2-261-0172

No.403, 4Fl., 36, Teheran-ro 87-gil, Gangnam-gu, Seoul,06164, Korea (City Air Tower, Samseong-dong)
TEL:+82-2-539-8565 FAX:+82-2-538-5190• Sales and import of optical materials, imaging and electronics
materials, synthetic resins, and synthetic rubbers, etc.

5 Zeon Shinhwa (Zeshin) Inc.

No.502 CALT B/D (City Airport)22, Teheran-ro 87-gil,Gangnam-gu, Seoul, 06164, Korea
TEL:+82-2-761-7030 FAX:+82-2-786-7221• Sales of imaging and electronics materials

6 Zeon CSC Corporation

3F.-2, No.266, Sec. 1, Wenhua 2nd Rd., Linkou
Dist., New Taipei City 24448, Taiwan (R.O.C.)
TEL:+886-2-2609-2156 FAX:+886-2-2600-6413

8 Zeon Chemicals Asia Co., Ltd.

16 Phangmuang Chapoh 3-1 Road, Huaypong Sub-district,
Muang Rayong District, Rayong 21150, Thailand
TEL:+66-33-017-781–6 FAX:+66-33-017-788• Manufacture and sales of synthetic rubbers

8 Tokyo Zairyo (Thailand) Co.,Ltd.

29th Floor Room 2903, Empire Tower 1 South Sathorn Rd.,
Yannawa, Sathorn, Bangkok, 10120, Thailand
TEL:+66-2-670-0285 FAX:+66-2-670-0283• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)• Sales of optical materials

9 Zeon Asia Malaysia Sdn. Bhd.

6 Zeon Taiwan Co., Ltd.
4F., No.36, Nanjing W. Rd., Datong Dist., Taipei City 103,
Taiwan (R.O.C.)
TEL:+886-2-2552-3620• Sale of electronics materials

7 Zeon India Private Limited
Unit Number: 708, 7th Floor, Time Tower MG Road,
Sec-28, Gurugram, Haryana, India – 122002
TEL:+91-124-4229461 FAX:+91-124-4229462• Import, sales, and marketing of synthetic rubbers and other
Zeon products

7 Tokyo Zairyo (India) Pvt, Ltd.

Time Tower, Unit No.708, 7th floor, Sector-28, M.G
Road, Gurgaon-122002, Haryana, India
TEL:+91-124-424-9011 FAX:+91-124-424-9005

Unit 208, Block B, Phileo Damansara II, No.15, Jalan16/11,
Off Jalan Damansara, 46350 Petaling Jaya, Selangor,
Malaysia
TEL:+603-7956-7069 FAX:+603-7957-1758• Sales of synthetic latexes

10 Zeon Chemicals Singapore Pte. Ltd.
100 Banyan Drive, Jurong Island, Singapore 627571
TEL:+65-6933-4400 FAX:+65-6933-4413• Manufacture and sales of S-SBR

10 Zeon Asia Pte. Ltd.

10 Asia Technical Support Laboratory

61 Science Park Road, #05-09/10 The Galen, Singapore
Science Park 2, Singapore 117525
TEL:+65-6266-7631 FAX:+65-6266-7712
10 Tokyo Zairyo (Singapore) Pte. Ltd.
331 North Bridge Road, #20-01/02, Odeon Towers,
Singapore 188720
TEL:+65-6337-5053 FAX:+65-6337-4557• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

11 Zeon Manufacturing Vietnam Co., Ltd.
No.109, Road No.10, VSIP Haiphong Township, Tan
Duong ward, Thuy Nguyen District, Haiphong City,
Vietnam
TEL:+84-225-3797-027 FAX:+84-225-3797-028• Manufacture and sales of packing containers

11 Zeon Research Vietnam Co., Ltd.
6th Floor, Building 85 Nguyen Du Str., Hai Ba Trung
District, Hanoi, Vietnam 100000
TEL:+84-24-3632-0557 FAX:+84-24-3632-0557• Design simulation of optical materials and molded products, andmarket research for Zeon products in Southeast Asia

11 Tokyo Zairyo (Vietnam) LLC.
4th Floor, Building 85 Nguyen Du Str., Hai Ba Trung
District, Hanoi, Vietnam 100000
TEL:+84-24-3941-3825 FAX:+84-4-3941-3826• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

12 Branch of Tokyo Zairyo (Vietnam) LLC in HCMC

Unit 1203, 2nd Fl., CITYVIEW, 12 Mac Dinh Chi st., Da Kao
Ward, Dist. 1, Ho Chi Minh City, Vietnam
TEL:+84-28-3911-0135 FAX:+84-28-3911-0136
13 PT. Tokyo Zairyo Indonesia
Gedung MidPlaza 2, Lantai 12, Jl. Jend. Sudirman Kav.
10-11,Jakarta 10220
TEL:+62-21-574-6454 FAX:+62-21-573-5661• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

331 North Bridge Road, #20-01/02, Odeon Towers,
Singapore 188720
TEL:+65-6332-2338 FAX:+65-6332-2339• Sales, export, and import of synthetic rubbers, synthetic latex,
and petroleum resins• Purchase and sales of synthetic rubbers, chemical products,
etc. (including international trade)

At Zeon Advanced Polymix Co., Ltd., solar power isgenerated on the plant’s roof.

Zeon Manufacturing Vietnam Co., Ltd.

ZEON GROUPCORPORATE REPORT 2020

18

Zeon Group Locations

Americas / Europe

as of July 1, 2020

14

15

11
1

12

6

5

4
3

2

7
8

9

19

ZEON GROUPCORPORATE REPORT 2020

10
13

16

1

Zeon Chemicals L.P.

4111 Bells Lane, Louisville, Kentucky 40211, U.S.A.
TEL:+1-800-735-3388 FAX:+1-502-775-2055
TEL:+1-502-775-2000• Manufacture and sales of synthetic rubbers

1

R&D Center

4111 Bells Lane, Louisville, Kentucky 40211, U.S.A.
TEL:+1-502-775-7765 FAX:+1-502-775-7783
1

Kentucky Plant

4100 Bells Lane, Louisville, Kentucky 40211, U.S.A.
TEL:+1-502-775-7600 FAX:+1-502-775-7614
2 Mississippi Plant

1301 West Seventh Street, Hattiesburg, Mississippi
39401, U.S.A.
TEL:+1-601-583-6020 FAX:+1-601-583-6032
3 Texas Plant

11235 Choate Road, Pasadena, Texas 77507, U.S.A.
TEL:+1-281-474-9693 FAX:+1-281-474-0966
4

Zeon Specialty Materials lnc.

25 Metro Drive, Suite 238, San Jose, CA 95110, USA
TEL:+1-408-641-7889 FAX:+1-408-516-9382• Sale of advanced materials

5

Tokyo Zairyo (U.S.A.) Inc.

750 Old Hickory Blvd., Building One, Suite 220
Brentwood, TN 37027
TEL:+1-615-922-4633 FAX:+1-615-942-7424• Purchase and sales of synthetic rubbers, chemical products, etc.
(including international trade)

8 Zeon Kasei Mexico S.A. de C.V.

15 Telene S.A.S.

Avenida Santiago Sur 100, Los Jassos, San Luis Potosi,
San Luis Potosi, MEXICO, C.P.78420
TEL:+52-1-444-478-5400

2, rue Marie Curie - 59910 Bondues, France
TEL:+33-3-20-69-57-10 FAX:+33-3-20-69-57-11

8 Tokyo Zairyo México, S.A. de C.V.

Pobřežní 620/3, 186 00 Prague 8, Czech Republic
Tel: +420-221-228-406 Fax: +420-221-228-405• Manufacture and sales of powder slush compounds

Boulevard Bernardo Quintana 7001 Torre II Suite 807
Colonia Centro Sur, C.P. 76090 Querétaro; Querétaro,
MéxicoTEL:+52-442-229-3242 FAX:+52-442-229-3244• Development and sales of Telene® DCP-RIM resin

16 Tokyo Zairyo Czech, s.r.o.

• Procurement and sales of synthetic resins, synthetic rubbers,
and other chemical products• Purchase and sales of synthetic rubbers, chemical products,
etc. (including international trade)

9 Zeon do Brasil Ltda.

Rua Arandu, 57/cj 23, Sao Paulo-SP, 04562-031
TEL:+55-11-5501-2120 FAX:+55-11-5501-2122• Sales of synthetic rubbers and resins, etc.

10 Zeon Europe GmbHHansaallee 249, 40549 Dusseldorf, Germany
TEL:+49-211-52670 FAX:+49-211-5267160• Sales, export, and import of synthetic rubbers and resins

11 Zeon Europe GmbH - Branch inFranceZEON France Succursale française de Zeon EuropeGmbH c/o Sofradec 153, Boulevard Haussmann 75008
Paris, France
TEL:+49-211-5267-145
12 Zeon Europe GmbH - Branch in Spain

C/Beethoven, 15, 4O, 08021 Barcelona, Spain
TEL:+34-93-183-87-08 FAX:+34-93-183-87-58

13 Zeon Europe GmbH - Branch in Italy
6 New York Office

333 Mamaroneck Avenue PMB#394 White Plains, NY
10605 U.S.A
Tel: +1-914-646-7450
7 McAllen Office2112 South Shary Rd, Suite# 26 Mission, TX 78572
TEL:+1-914-314-8919

Zeon Chemicals L.P.
Kentucky Plant

Piazza Quattro Novembre, 7, 20124 Milano, Italy
TEL:+39-02-67141701 FAX:+39-02-36680124

14 Zeon Europe GmbH - Branch in U.K.

Scott Court, Unit 2A, Ocean Way, Cardiff, CF24 5HF,
United Kingdom
TEL:+44-1446-725000 FAX:+44-1446-747988

Zeon Europe GmbHZEON GROUPCORPORATE REPORT 2020

20

Zeon Group LocationsJapan

as of July 1, 2020

Zeon Corporation – Head Office
Shin Marunouchi Center Building, 1-6-2 Marunouchi,
Chiyoda-ku, Tokyo 100-8246, Japan
TEL: +81-3-3216-1772 FAX: +81-3-3216-0501
Tokyo Zairyo Co., Ltd.
Shin Marunouchi Center Building, 1-6-2 Marunouchi,
Chiyoda-ku, Tokyo 100-0005, Japan*same as follows
TEL: +81-3-5219-2171 FAX: +81-3-5219-2201• Trading
Zeon Kasei Co., Ltd.
TEL: +81-3-5208-5111 FAX: +81-3-5208-5290
Plants: Ibaraki, Yamaguchi• Manufacture and sale of PVC compounds, packaging
materials, packaging containers, logistics equipment, etc.
Zeon F&B Co., Ltd.
TEL: +81-3-3216-1410 FAX: +81-3-3216-1421• Agency business for life and non-life insurance; loan andfactoring business to each group company
RIMTEC Corporation
TEL: +81-3-5220-8581 FAX: +81-3-5220-8584
Plants, R&D Center: Mizushima• Sales of formulation liquid for Reaction Injection
Molding (RIM)ZIS Information Technology Co., Ltd.
TEL: +81-3-3216-6500 FAX: +81-3-3216-6534• Consulting about data processing systems; sales andmaintenance of computer and office automationequipment
Zeon Nano Technology Co., Ltd.
TEL: +81-3-3216-1766 FAX: +81-3-3216-1767• Processing and sales of Carbon Nanotubes and related
products
ZS Elastomer Co., Ltd.
TEL: +81-3-3216-0620 FAX: +81-3-3216-0629• Sales and R&D of S-SBR
Zeon Medical Inc.
TEL: +81-3-3216-1265 FAX: +81-3-3216-1269
Plant: Takaoka• Manufacturing and sale of medical devices
Okayama Butadiene Co., Ltd.
Sen-i Kaikan 2F, 3-1-11 Nihonbashi-Honcho, Chuo-ku,
Tokyo 103-0023, Japan
TEL: +81-3-3278-0721 FAX: +81-3-3278-0722• Manufacturing of butadiene monomer

21

ZEON GROUPCORPORATE REPORT 2020

Zeon Corporation – Kawasaki Plant
1-2-1 Yako, Kawasaki-ku, Kawasaki-ku, Kanagawa
210-9507, Japan
TEL: +81-44-276-3700 (direct)
FAX: +81-44-276-3701

Zeon Corporation – Tokuyama Plant
2-1 Nachi-cho, Shunan-shi, Yamaguchi 745-0023,
Japan
TEL: +81-834-21-8501 (direct)
FAX: +81-834-21-8793

Zeon Corporation – R&D Center
TEL: +81-44-276-3721
FAX: +81-44-276-3720

Zeon Yamaguchi Co., Ltd.
2-1 Nachi-cho, Shunan-shi, Yamaguchi 745-0023,
Japan
TEL: +81-834-21-8482 FAX: +81-834-21-8663• Purchase and sale of civil engineering materials, packing
materials, and various facilities; design and construction,
contracting for various plants; environment analysis

Zeon Corporation – Takaoka Plant
630 Ogino, Takaoka-shi, Toyama 933-8516, Japan
TEL: +81-766-21-0252 (direct)
FAX: +81-766-21-8201
Zeon North Co., Ltd.
351 Ejiri, Takaoka-shi, Toyama 933-0062, Japan
TEL: +81-766-25-1111 FAX: +81-766-25-1114• Contracting, design, construction, and management forvarious facilities; sales of industrial materials andequipment, purchase and sale of petrochemical
products; testifying environmental measurements,
measurement working environment; conducting various
analyses
Optes Inc.
422-1 Futagamishin, Takaoka-shi, Toyama 933-0981,
Japan
TEL: +81-766-32-1590 FAX: +81-766-32-1591
Plants: Takaoka, Himi, Tsuruga• Manufacture of optical films

Zeon Corporation – Mizushima Plant
2767-1 Kojima Shionasu Aza Niihama, Kurashiki-shi,
Okayama 711-8511, Japan
TEL: +81-86-475-0021 FAX: +81-86-475-1169

Zeon Corporation – Osaka Office
Mainichi Shimbun Bldg. 3-4-5 Umeda, Kita-ku, Osaka-shi,
Osaka 530-0001, Japan
TEL: +81-6-4797-8220 FAX: +81-6-4797-8225
Tohpe Corporation
1-5-11 Chikkoshinmachi, Nishi-ku, Sakai-shi, Osaka
592-8331, Japan
TEL: +81-72-243-6411 FAX: +81-72-243-6415
Plants: Ibaraki, Mie, Kurashiki, Kyushu• Manufacturing and sale of paints and chemical products

Zeon Corporation – Nagoya Office
Ichigo Fushimi Bldg. 7F, 1-18-24 Nishiki, Naka-ku,
Nagoya-shi, Aichi 460-0003, Japan
TEL: +81-52-209-9145 FAX: +81-52-209-9147

Zeon Chemicals Yonezawa Co., Ltd.
3-446-13 Hachimanpara, Yonezawa-shi, Yamagata
992-1128, Japan
TEL: +81-238-29-0055 FAX: +81-238-29-0053• Manufacturing, processing and sale of aromatic
chemicals, the intermediate of medicine andagricultural chemicals and RIM formulation liquid

River Xemex Co., Ltd.
2-11-17 Osachigosho, Okaya-shi, Nagano 394-0082,
Japan
TEL: +81-266-21-2131 FAX: +81-266-21-1550• Manufacture of medical devices

Zeon Opto Bio Lab Co., Ltd.
234-1 Konaka-cho, Sano-shi, Tochigi 327-0001, Japan
Tel: +81-283-23-7061 Fax: +81-283-23-7054• Mold processing of plastic products

Zeon Polymix Inc.
1-11-1 Ishizue, Otsu-shi, Shiga 520-2272, Japan
TEL: +81-77-546-1223 FAX: +81-77-546-6099
Plants: Otsu
• Manufacturing compound of synthetic rubber(carbon masterbatches)

ZEON GROUPCORPORATE REPORT 202022

Kawasaki Plant and the R&D Center

Zeon’s Business and Strategy
This section describes Zeon’s business and strategy in the Enterprise Blueprint for 2020,
with the target of “Over 500 billion yen in consolidated net sales” and the mission“Zeon makes the future today through the power of chemistry.”

Interview with the President

P. 24

Zeon’s Business and Strategy
Elastomer Business

P. 27

Specialty Materials Business

P. 29

Research and Development (R&D)

P. 31

Corporate Governance

P. 33

23

ZEON GROUPCORPORATE REPORT 2020

Interview with the President

A growth foundation andcorporate culture reforms
to overcome difficulties
President Kimiaki Tanaka outlines where Zeon Group
is today and its outlook for the future in a Q&A
format.

Kimiaki Tanaka
President
Zeon Corporation

Q.1 What is the situation in terms of the economic environment and for the Zeon Group, and how was thesituation in Zeon’s Elastomer Business and Specialty Material Business in FY 2019?

A.1 [Overview] Achieved annual sales of 300 billion yen for three consecutive years. The market softening
seen in the Elastomer Business is continuing. The Specialty Material Business achieved
record-high sales and profit, and was a driver of our overall business performance.

●Fig. 1: Consolidated Results by Segment
Net sales■Specialty Materials

Operating income
Net sales(100 million JPY)

3,000
2,500

[2,876][3,327]539

308[3.375]331
543[3,220]

515

490
222
206

1,500

1,662

1,000

98

0

◆Total

400

389

2,000

500

■Others

Elastomers

Operating income
Consolidated net sales given in [ ](100 million JPY)
(intra-group transactions are excluded)

4,000
3,500

■Elastomers●Specialty Materials

167
1,946

1,981

261

300
250

1,788
173

177

200
150

161
96

750

865

851

917

2016

2017

2018

2019 (FY)

PhaseⅡ

350

SZ-20 PhaseⅢ

100
50
0

While our performance in FY 2019 saw lower revenue andprofit in terms of sales and operating income, our current term
net income rose due to decreased extraordinary loss including
impairment loss. Although revenue and profit fell year on year,
we have maintained annual sales of around 300 billion yen forthree consecutive years.
The COVID-19 pandemic had almost no impact on our performance in FY 2019.
Revenue and profit fell in the Elastomer Business, impacted by the global economic slowdown sparked by the trade friction between the United States and China. (See Fig. 2 on nextpage) We maintained a similar shipment volume year on yearfor general-purpose rubber, which is mainly used in tire applications, while demand was weak for specialty rubbers mainly
used in automotive industry applications, and their shipment
volume fell slightly.
For synthetic rubbers and latex, the price of the main raw
materials, naphtha and butadiene, continued the low-pricetrend seen since FY 2018, and linked to this, sales prices simultaneously fell due to lower unit sales prices (formula pricing)and shrinking demand. The fall in the price of the raw materials,
instead of exerting a positive effect, had a large negative effect.
(See also → P. 27)
The Specialty Material Business posted increased revenue
and profit higher than in FY 2018. (See Fig. 3 on next page)
ZEON GROUPCORPORATE REPORT 202024

●Raw material/sales priceformula (rubbers, latexes)●Market downturn(100 million JPY)

Interview with the President
The business is growing with the three pillars of optical films,
optical plastics, and battery materials. Demand for optical films
remains brisk, and lower fixed expenses on manufacturing
floors as a result of higher utilization rates is also contributing
to increased profit. Meanwhile, as we also recognize that there
are rising sales, general and administrative (SG&A) expenses aswell as rising expenses related to development prototypes, weare striving to further improve productivity.
Demand for optical plastics, which are used in the stage before
film processing, is increasing. While optical plastics have so far beenused in applications such as smartphone camera lenses, we areseeing increasing demand due to the trend towards multiple-lenscamera modules for use in portable electronic devices, and due tostrong demand for medical syringes and vials. With business growing in these new applications, both production and sales were at
maximum capacity in FY 2019. To meet the robust demand, we arelooking into scaling up our production capacity.
Our battery materials are mainly used in lithium-ion batteries forautomobiles, and we are meeting these needs by delivering our
products to factories in China and Europe where lithium-ion batteries are produced. Shipments remained brisk throughout FY 2019,
but demand fell toward the second half of the year due to deferred
production in light of upcoming revisions to the NEV mandate*in China and fewer days of factory operations after the Chinese
New Year. Demand in FY 2019 was down year on year, and future
demand trends need to be watched closely. (See also → P. 29)*NEV mandate
The New Energy Vehicle mandate regulates automobile sales andstems from fuel regulations enacted in China. The NEV mandate
is contributing to an increase in electric vehicles.

-27

Price decrease●Fig. 2: Operating Income Variance
the Elastomer Businessof raw inmaterial+7-89●Raw material/sales priceformula (rubbers,
latexes)+46●Market downturn(100 million JPY)

-18

-27

-80

177

96

Price decreaseof raw material

FY 2018 Quantity Price+7-89 Exchange Raw material SG&A
rate
prices-18

FY 2019

+46

-80

177
FY 2018 Quantity Price

96

Exchange Raw material SG&A
rate
prices

FY 2019●Fig. 3: Operating Income Variance in the Specialty Material Business(100 million JPY)

Steady sales of opticalplastics, films andenergy materials+34(100 million JPY)

161

-9

-4

Increased operationof optical films

+25

-34

freight andpackaging●Increased
Steadysales ofthe
opticalIncreased
operation
costfilms
due tothe increased
plastics,
andofshipment
optical films
R&D and trial manufacturing●Increased
energymaterials
cost of optical films

+34

-9

+12
-4

+25

-34

FY 2018 Quantity Price Exchange Raw material SG&A
rate
pricesthe freightand packaging●Increased

cost due to the increased shipment●Increased R&D and trial manufacturing
cost of optical films

161
Q.2 How has the Zeon Group been affected by COVID-19 and+12what actions are you
taking?

FY 2018 Quantity Price Exchange Raw material SG&A173

FY 2019173
FY 2019

A.2 [Overview] There has been little impact on our production activities, and we are operating
rate
pricesalmostthe same as

during normal times. The impact on business performance was negligible in FY 2019, but we expect
the impacts to increase in FY 2020. (See also → Summary of COVID-19 response on P. 5–6)

The impact on our FY 2019 business performance was only
negligible, but we are projected to feel effects starting in FY
2020. Since we provide a wide range of materials to customers
in a wide range of industries, however, the effects will not be
uniform but varied.
Even within the Elastomer Business, latex is used to makemedical gloves, and demand for latex is markedly higher.
Meanwhile, our Synthetic Rubber Business is being impacted
by the suspension of automotive production. The Chemicals
Business is being impacted, although not as severely as theSynthetic Rubber Business, by the suspension of home-use
adhesive production.
The Specialty Material Business is projected to continue
posting comparatively strong performance for optical plastics
and optical films. Meanwhile, market softening is projected in
the Battery Materials Business, but the scale of this is not yet
visible.
In terms of business operations, our factories are operating
almost the same as during normal times. We have established25

ZEON GROUPCORPORATE REPORT 2020

an emergency response headquarters, with subgroups forfunctions such as inventory management and separate business divisions, and they are working to quickly obtain information and take targeted action in response.
In terms of financing, in addition to our original commercial
paper issue of 50 billion yen, we have increased our planned
commitment line to 50 billion yen. This assures that we havesufficient liquidity.
As a manufacturer, we are placing particular priority on our
infection control measures in manufacturing divisions. We are
instituting protective measures using masks and face shields,
and are also taking measures to ensure social distancing. We
are also taking thorough prevention measures at the Head Office and our sales bases in Japan and worldwide, including having employees work from home, and are continuing business
operations according to conditions at our business partners
and elsewhere. We are also communicating with our factory
employees and all Group employees using video messages asneeded.

●Fig. 4: The Enterprise Blueprint for 2020 and the Mid-term Management Plan SZ-20 Phase III: Groupwide strategy

Enterprise Blueprint for 2020

Zeon makes the Future Today through the Power of Chemistry
Zeon will continue to contribute to the realization of customer dreams and a prosperous
society through employees’ individual growth.

Targeting consolidated net sales over 500 billion yen in FY 2020
SZ-20 Phase III: Groupwide Strategy

Growth[1] Reinforce the combined strengths of the Zeon Group. Explore waysof going beyond boundaries and collaborating with external players
to provide solutions globally as a contribution to society.
[2] Accelerate the pace of new business creation and product development in key
development areas: global environment, smart devices, and health and living

CultureQ.3[3] Cultivate a corporate culture that places value on taking proactive
action by harnessing diverse ideas and implementing them.

How is the progress of efforts to achieve the group-wide strategy (Fig. 4) of the SZ-20 Phase III midterm management plan? How is the review of the next mid-term management plan moving forward?

A.3 [Overview] Although we have not reached sales of 500 billion yen, we have been able to achieve stable sales inexcess of 300 billion yen. We are moving forward with our review in order to smoothly transition to
implementing the next mid-term management plan in FY 2021.

In light of current conditions, there is very little chance thatbusiness performance in FY 2020, the final fiscal year of our plan,
will improve. As such, we are planning to conduct a review of our
Mid-term Management Plan SZ-20 using performance throughFY 2019, complete drafting of the next-term management planand budget as well as the implementation policy within FY 2020,
and then quickly get to work on our next mid-term management
plan from April 2021.
We launched a project in 2019 to draft our next mid-term
management plan, which reviews our vision for the Zeon Grouplooking 10 years into the future to 2030 as well as what the world

will be like after that. As part of this, we received suggestions
from employees in their 30s and 40s who represent our Group’s
future. The suggestions deserve serious consideration from ourmanagement team as well.
Although we did not reach the SZ-20 performance indicator of
500 billion yen in sales, we were able to maintain sales in excess
of 300 billion yen in FY 2019, which had previously been a hurdle,
even while sustaining effects from the global economic slowdown, and this can be considered good progress. We have also
expanded our production facilities every year. We will continue
to powerfully forge ahead without changing this trajectory.

Q.4 What is the status of actions for the United Nations Global Compact, the SDGs, and strengthening
diversity?

A.4 [Overview] We are deepening the understanding of all employees through trainings and dialogue, and willconnect our business activities to contributions to society.

A policy set by top management in FY 2019 was for individuals tolearn and educate each other through diversity promotion, and tochange into an organization that creates innovation. After creating
diversity in our human resources, this policy aims to have diverse
human resources mutually accept each other and work together tocreate an inclusive organization that acts as a unified team. We anticipate that individuals achieve growth as a result, and by working
together, become an organization that generates innovation.
We are holding “career design” trainings and one-on-one meetings on a trial basis as ways to build a corporate culture that prioritizes dialogue and have verified their effectiveness. Continuing

in FY 2020 as well, we will build a corporate culture that prioritizes
dialogue and offer opportunities for people to create change inthemselves.
Based on becoming a signatory to the United Nations Global
Compact and establishing and releasing our human rights policy, we
have held CSR informational sessions for all employees since 2019
and are also verifying their level of understanding through e-learning,which we will continue. We will deepen our understanding for theSDGs, including among our senior management team, incorporate
the SDGs into our next mid-term management plan, and contributeto achieving the SDGs through our business activities.

ZEON GROUPCORPORATE REPORT 2020

26

Zeon’s Business and Strategy

Elastomers Business
Consisting of the three businesses of synthetic rubber, synthetic latex, and chemicals, the Elastomer Businesssupports the Zeon Group’s foundation and provides high-quality materials essential in all kinds of industrial fields
around the world. Its sales account for more than 50% of total sales in the Zeon Group. While shipment volumes in
FY 2019 remained at almost the same level as the previous year, in addition to contracting global demand since thesummer due to effects from the U.S.–China trade friction, slumping unit sales prices for synthetic rubbers inparticular, caused by greater market competition and falling raw material prices, resulted in decreased sales andprofit.

Business Overview and Future Strategy
In FY 2019 the Synthetic Rubber Business posted shipment volumes for general-purpose rubber,mainly used in automotive tires, above those of the previous year; however, net sales fell, and both the
shipment volumes and sales of specialty rubbers used in advanced automotive components and generalindustrial goods decreased.
The full impacts of COVID-19 emerged from the start of FY 2020. In addition to the direct effects felt
in the Synthetic Rubber Business, which is closely tied to the automotive
industry, demand slumped in other industries such as oil drilling andconstruction equipment and was coupled with falling market prices.
Therefore, we are envisioning that FY 2020 will be an exceedingly challenging
year for the Synthetic Rubber Business. We anticipate that demand in thesynthetic rubber market will bottom out during the April–June quarter andthen show gradual recovery, but full recovery will not be seen until 2021.
Under these conditions, we are focusing on having a system in place able
to immediately adapt to future demand trends and meet changing customer
needs. We will further expand and develop our S-SBR business, and thespecialty rubber business (an area where Zeon is particularly strong),
through expanded production capacity eyeing the future, new productdevelopment, and a detailed level of technical support in the markets.
In the Synthetic Latex Business, demand for NBR latex for disposable
gloves continued to show expansion in FY 2019, and while competition did
intensify with increased production capacity at competitors, we satisfied
Hiroyuki Hirakawa
Director & Senior Corporate Officer
Elastomers and Chemicals Business
Division Manager – Raw Material
Division Manager – Logistics

Net sales-19.2

billion JPY(100 million JPY)

2,000

1,789

1,946

1,981

2017

2018

1,662

(-10%)

1,788

1,500

1,000

500

0

Segment
ratio

27

ZEON GROUPCORPORATE REPORT 2020

2015

2016

58
55%

2019 (FY)demand by operating our facilities at full capacity. Meanwhile, our specialty product for cosmetic puffs,
which had been posting strong performance, saw sales decline year on year due to changes in cosmetics
preferences, lower inbound consumption, and increased price competition among other factors.
Entering FY 2020, demand further expanded for disposable gloves used in medical and otherapplications to meet needs in the COVID-19 pandemic, and we are continuing to focus on increasing our
production and supply volumes. The Synthetic Latex Business is not expected to experience as much
COVID-19 impact as the Synthetic Rubber Business, but some falloff in markets apart from gloves isunavoidable. Going forward, we will accelerate development to steadily commercialize new, differentiatedlatex materials with higher added-value for surgical gloves.
In the Chemicals Business, global demand in FY 2019 for our main products of thermoplastic
elastomer SIS and C5 petroleum resin PDR remained largely strong, but shipment volumes decreased year
on year due to the regular inspection of the Mizushima Plant, the Chemicals Business production base,and softening in Asian markets caused by the U.S.–China trade friction. Nevertheless, steady progress
was seen in our key strategy to shift to and expand business in high value-added products, mainly
for asymmetric SIS. In FY 2020, while the impacts of the global COVID-19 pandemic are visible, theChemicals Business has few automotive applications and direct impacts are relatively slight. Meanwhile,
our business in adhesive materials is seeing increased demand for packing tape due to the expanding
e-commerce market, and we are continuing to produce SIS and PDR at full capacity with a plan to offer
robust capacity to meet customers’ high level of supply requests. In addition, we will not pull back fromour ongoing strategy to shift to higher value-added products, and will also review further increasing our
production capacity.

Operating income (ratio)

Elastomer Business breakdown (FY 2019)
Sales quantity (1,000 tons) Net sales (100 million JPY)

(100 million JPY)

350

Synthetic rubber

300
250
200

207

206

222

(-45%)

150
100
50
0

Segment
ratio

12.4

11.6

2015

2016

33%

11.7
2017

Latex

-8.0

billion JPY

177

8.9
2018

96

(%)

5.4

10

20

0

2019 (FY)

Chemicals

348

（⬇2％）

121

（⬇2％）

129

（⬇7％）

1,238

（⬇11％）

168（⬇11％）

348（⬇9％）●Elastomer Business: Lower revenue and profit
Synthetic rubber: Weak demand for applications including in the automotive industry and generalindustrial goods, and prices fell hand in hand with lower raw materials prices
Latex: Lower demand for applications including cosmetics materials and generalindustrial goods, and prices fell hand in hand with lower raw materials prices
Chemicals: In addition to shipments commensurate with production volumes due toa regular inspection of the main plant, Asian markets softened

ZEON GROUPCORPORATE REPORT 202028

Zeon’s Business and Strategy

Specialty Material BusinessSpecialty materials refers to materials and components offering high added value due to their macromolecular
design and processing technology. Focusing on future growth areas, we are positioning IT components (optical,
packaging, electronics), energy materials, and medical devices as our three main business areas.

Business Overview and Future Strategy
Performance in the Specialty Material Business in FY 2019 was largely in line with expectations
for both sales and profit. The Film Business accounts for a large volume of the Specialty Material
Business. Creating growth in the Film Business is key to increasing overall sales. Economic
recession is forecast due to the effects of COVID-19, but demand for large-screen TVs remains
high. There is also high demand for educational tablets used in home schooling as well as PCs forpeople working from home, and we must contribute to society bystrengthening our supply of small- and mid-sized films.
As such, we are moving forward with increasing the production
capacity of our optical film plants in Tsuruga City and Takaoka City,
aiming for operations to begin in 2020.
This move is expected to contribute to BCP from plant
decentralization and have supplemental effects on the local
economies from new employment. The new line at Tsuruga Plant willmeet needs for larger LCD panels and be able to produce retardation
films with the world’s largest width (2,500-mm class). There is strong
demand for these films for LCD panels for large-screen TVs due totheir dimensional accuracy and other excellent properties.
We are seeing more inquiries for Cyclo Olefin Polymers (COP) as
plastic lens with the accelerated shift to multi-lens smartphone
cameras. We will continue to develop advanced products thatleverage the characteristics of COP. The microfluidic chip prototyping
Yoshiyuki Sone

Senior Corporate Officer
Specialty Business
Division Manager - Specialty Components+ 6.6

Net salesbillion JPY(+8%)(100 million JPY)

1,000

750

710

865

851

2017

2018

917

750

500

250

0

Segment
ratio

29

ZEON GROUPCORPORATE REPORT 2020

2015

2016

25
28%

2019 (FY)service is seeing stable expansion and was spun off to establish Zeon Opto Bio Lab in April 2019to build out its structure for medical packaging applications leveraging the property of low
adsorption to proteins.
Demand for battery materials (energy materials) is also rising sharply with increased demandfor electric and hybrid vehicles. Demand is expected to recede temporarily due to the COVID-19
pandemic, but moves to expand the electric vehicle market in Europe are ramping up quickly, anddemand for battery materials is growing.
In electronic materials, transparent insulating films for displays are seeing substantial growth.
We are developing pad-type thermal interface material with excellent thermal conductivity anddurability as a new product and developing the market, primarily for semiconductor applications.
Demand for specialty chemicals as a whole remains brisk, continuing the same trend from lastyear. Cheap products launched by new competitors have been weeded out from tightened
environmental regulations. Market conditions are recovering, and demand for Zeon’s products isrising.
The Medical Business invested in a venture fund in FY 2019. In parallel with our ongoing own
development, we aim to expand our business portfolio by collecting information on the latest
medical technologies in Japan and around the world, identifying projects to collaborate on withstartup companies, and so on.
In our Single-Walled Carbon Nanotube Business, we are conducting ongoing research on
various composite materials and are beginning to commercialize some parts and materials,
including shale gas O-rings. We will continue to pursue research to develop products leveraging
the characteristics of carbon nanotubes.
Operating income (ratio)

Specialty Material Business breakdown (FY 2019)+1.2

billion JPY(+7%)(100 million JPY)

200

167

120

80

40

0

Segment
ratio

173

161

160

Net sales (100 million JPY)

98

82
11.6

2015

13.1

19.4

18.9

19

20
10

2016

2017

2018

Specialty chemicals

291⬆

Specialty plastics

568

⬆10%

Medical, etc.
(%)

02019 (FY)% change

59

⬆

5%

4%

●Specialty Material Business: Higher revenue and profit
Specialty chemicals: Battery materials continued to post strong performance.
Chemicals and toners posted reduced revenue and profit.
Specialty plastics: Optical plastics and optical films both continued to post
strong performance.

60%

ZEON GROUPCORPORATE REPORT 202030

Zeon’s Business and Strategy

Research and Development (R&D)
The R&D Center conducts Zeon Group’s R&D activities
with a workforce of more than 400 researchers. In addition
to the R&D Center’s 10 research buildings located next tothe Kawasaki Plant, we have established other laboratories
located near production plants. We develop new products
and improve existing products through close collaboration
with business divisions to meet the needs of customers.
Additionally, we are exploring new materials, developing
and using new analysis and simulation techniques and AI/
MI, and developing new and improving existing production
processes and equipment.

R&D expenses(100 million JPY)

200

150

141

151

165

153

2018

2019 (FY)

132

100

50

0

2015

2016

2017

New Systems for More Efficient R&D
It has been three years since we began implementing theInnovation Highway framework and multi-review process. Our
most critical mission now is to increase our research output. To
do this, it is important that we ① definitively produce
outcomes from our current research themes, and ② assess
whether the outcomes can become large businesses.
The research flow encompasses the stages of discovery,
research, development, and production, and decisions must be
made at each of these stages.
Product planning stage: Select discovery themes
considering their future market potential
Product design stage: Transition to the verification stage
Production preparation stage: Examining how stableproduction can be achieved at the plant, and proceeding toactual commercialization
Using the Innovation Highway, we select themes in the
discovery stage based on expert views and market
information. Multiple candidates were also proposed last year,
and we will continue to explore themes.
In the multi-review process, we review projects at the
product planning and product design stages from a range ofviewpoints both inside and outside the development division
to determine whether they truly meet customer needs andwhether there is a market for a commercialized product. Last

year too, we conducted multi-reviews for themes whose
progress had stalled. This fiscal year, we will continue to moveup our assessments and conduct multi-reviews at earlier
stages to enhance efficiency.
In addition, we will further select, concentrate, and prioritize
our limited resources. By selecting themes nearing
commercialization, concentrating staff and resources on them,and bringing together the capabilities and expertise of all
employees, we are increasing the potential to commercialize
products in a shorter timeframe. We are actively using
simulation technology and outside research resources as wellto further increase the efficiency of research and development.
●R&D System
Research &Development Center

Foundation Technology Laboratory
New Materials Development Laboratory
CNT Laboratory
Elastomer Laboratory
Functional Particles Laboratory
C5 Chemicals Laboratory (Mizushima)
Specialty Chemicals Laboratory
Composite Material Laboratory
Advanced Performance Materials Laboratory
Specialty Plastics Laboratory
Precision Optics Laboratory (Takaoka)
Medical Laboratory (Takaoka)

Tetsuya Toyoshima

Senior Corporate Officer
Research & Development
Division Manager – Research & Development Center

31

ZEON GROUPCORPORATE REPORT 2020

Manufactured Product Development Laboratory
Production Technology Laboratory

●Multi-review process to strengthen output at an early stage and Innovation Highway framework for mid- to long-term R&D

2030 and after

Until 2025
Launch line

Achieving results at an early stage
through selection and concentration

Evaluate progressfrom multifaceted
viewpoints in themulti-review
processKey

Global development Health
Environmentand Living
areas

Suspension or
postponement when
KPIs are not met

Smart
Devices

Review and select research themes
anticipated to generate resultsin the mid- to long term using the
Research theme ideas Innovation Highway

Changing the research culture
In SZ-20 Phase III, we added the phrase “throughemployees’ individual growth” to the Enterprise Blueprintfor 2020. The FY 2020 policy for the Research &Development Division also places a strong focus onchanging how we do research. More than just a slogan of“change,” the policy embodies our strong determination tochange. Researchers will change themselves, and we willchange Zeon’s research and development as a whole. To
achieve this, I am also encouraging our division to get newideas by going outside and conducting joint research withgroups in other industries and conducting activities such asindustry–academia–government collaboration.
With our research structure, from this fiscal year we are
beginning a new project system for market, application andtechnology topics that straddle laboratories, and creating
cross-laboratory projects for them instead of vertical ones.
Our research and development expenses also remain on thesame scale as before. We will invest in a pilot plant for
product commercialization and strengthen our analysis
function in the Foundation Technology Laboratory.

Intellectual Property Strategy
We always make efforts to expand our intellectual property
rights with our policy of “patent first” to enhance ourcompetitiveness and contribute to industry development inline with our corporate strategy. We define “patent first” asfiling patent applications based on our patent portfolio strategy
prior to product development, product launch announcements,

Maintain a good balance ofshort-term and long-term R&D
themes in the key developmentareasand distributing samples. We also define it as developing
products that do not infringe on other companies’ intellectual
property rights by conducting patent searches from the earlystages of development.
Product differentiation is achieved by strategically protecting
individual technologies with multiple intellectual property
rights rather than a single application of rights. We will enhance
our competitiveness not only for products but also throughacquiring intellectual property rights related to manufacturing
processes and applications and keeping our manufacturingknow-how confidential. We will also rigorously evaluate
whether our intellectual property is being used effectively.

Assessing real needs
We are working to more closely and more quickly assess
whether customers’ true needs match Zeon’s technology
seeds. We are seeking to create not materials that would begood to have, but materials that are indispensable. If thematerials that are indispensable are only offered by Zeon, we
will be selected by customers with the potential to turn thematerials into major businesses. This is true differentiation.
In the long term, we are also aware of the momentum insociety to move away from petrochemicals and reduce the useof plastics. Together with Yokohama Rubber Co., Ltd., in July
2018 we jointly developed world-first technology to produce
isoprene, a tire raw material, from biomass. This is how weview true needs as being part of society’s hopes andexpectations, and will pursue uncovering true needs from thewants and needs of a wide range of stakeholders and feedingthem into our research and development.

ZEON GROUPCORPORATE REPORT 2020

32

Zeon’s Business and Strategy

Corporate GovernanceCorporate Governance Report (PDF)

Visit our
corporate
website for
more
information

Zeon aims to increase profits and enhance corporate
value on an ongoing basis while respecting and balancing
the various interests of its shareholders and other diverse
stakeholders. To this end, we are continuing efforts tobuild a system that enables efficient and sound corporate
management through corporate governance.
Maintaining a system of corporate governance allows

http://www.zeon.co.jp/csr_e/management.html
Basic Policy on Corporate Governance (Japanese Only)

http://www.zeon.co.jp/content/200281514.pdf

us to clarify the functions and roles of each organizational
entity within the company and to carry out rapid decisionmaking and execution. We are also improving corporatetransparency through appropriate monitoring anddisclosure of business activities and their effects. We aredetermined to further enhance our corporate governancesystem to effectively carry out these aims.

●Corporate Governance System
General Meeting of Shareholders(Appointments/
dismissals)

Decisions/Supervision(appointments/dismissals)
RequireDirector andadviceOfficer Nomination and
Board of Directors
Compensation Committee Suggestions

Auditing

Corporate Auditors (Board)
Auditing

Decisions/Supervision(selections/dismissals)

Collaboration

Executive Committee
Department ofInternal Auditing(Dismissals)
Collaboration

Financial Auditors

Auditing Personnel

Financial
AuditsBusiness Execution &Internal Controls System

Representative Director
Reporting

CSR Conference
CSR
Basic Policy
Committee

Risk Management Committee

Reporting(external)

Compliance Committee

External
lawyers

Information Management Committee
Environmental & Safety Affairs Committee
Quality Assurance Committee
PL Committee

Reporting (external)

Internal audits(Appointments/
Collaboration dismissals)(assistance)

Public Relations Committee
Business divisions, indirect departments, laboratories, and plants
Reporting(external)

Control/monitoring

Subsidiaries and affiliates●Board of Directors
The Board of Directors meets, in principle, every monthwith corporate auditors in attendance to ensure compliancewith applicable laws and the Articles of Incorporation in theexecution of business. In addition to its statutory duties, therole of the Board of Directors is to make important decisions
about basic management policy, strategy, and other aspectsof business execution. As of July 2020, the Board of Directors
consists of seven directors, including three outside directors.
●Executive Committee
The Executive Committee, in accordance with the Executive
Committee Rules, comprises the President and executive
officers ranked senior corporate officer or above and meets
twice a month in principle to examine and make decisions onimportant business matters after due deliberation involving
consultation with attending full-time corporate auditors.
Important business matters stipulated in the Board of Director
Rules are examined and decided by the Board of Directors.

33

ZEON GROUPCORPORATE REPORT 2020

Reporting(external)

Reporting(external)●Board of Corporate Auditors
The Board of Corporate Auditors comprises five members,
including three outside corporate auditors. The Board
reports, discusses, and adopts resolutions on importantbusiness matters. In accordance with the auditing guidelines
established by the Board of Corporate Auditors, eachcorporate auditor audits directors’ execution of their duties
through various means, such as attending Board of Directors
meetings and monitoring business operations, including
subsidiaries’ operations.
●Director and Officer Nomination and Compensation Committee
The Director and Officer Nomination and Compensation
Committee is placed under the Board of Directors as anadvisory organ for the purpose of strengthening the objectivity
and transparency of the Board of Directors functions related
to nominating directors and officers and deciding theircompensation. The committee is composed of four members,of which three are independent outside directors.

Director and officer compensation
We use a performance-based compensation system as
one type of healthy incentive to achieve sustained growth.
Individual compensation is decided by the Representative
Director after receiving the advice of the Director andOfficer Nomination and Compensation Committee.

In the case of committing a serious violation of the law,or an act violating company policy either intentionally or
through gross negligence, or other reason that is cause fordismissal of the director or officer as provided in internal
company regulations, the Board of Directors deliberates thecase and dismisses the director or officer concerned basedon the Companies Act and other legislation.

●Director and officer compensation structure

Evaluating the effectiveness of the Board of Directors

Internal Directors• Fixed-amount cash compensation• Performance-based cash compensation• Restricted stock compensation system

Corporate Officer• Fixed-amount cash compensation• Performance-based cash compensation

Outside Director• Fixed-amount cash compensation

Questionnaires are conducted for directors including
outside directors and auditors about the operations of theBoard of Directors. Questionnaire responses are analyzed
and evaluated by a third-party outside lawyer entrusted toperform the task, who has provided the opinion that our
Board of Directors operates with a high degree of overall
effectiveness.

Appointment and dismissal of directors and officers

Constructive dialogue with shareholders

Nominations of candidates for directors and auditors
and appointments of corporate officers are made basedon the requirements provided in the Basic Policy on
Corporate Governance, with advice given by the Director
and Officer Nomination and Compensation Committee,
a recommendation by the Representative Director, and adecision by the Board of Directors.

The Department of Corporate Communications manages
dialogue with shareholders, which is overseen by the
corporate officer in charge of CSR. Accurate, impartial
information is provided in a timely manner. We continue tohold briefings for investors quarterly, expand the materials
released on our website, and increase opportunities
for dialogue apart from individual meetings, such as
participating in company briefings for individual investors.

Risk Management
The Risk Management Committee promotes Zeon’srisk management. Activities to prevent legal violations
and ensure legal compliance are conducted under theCompliance Committee. The Information Management
Committee promotes the appropriate management of
information from when it is received to when it is destroyed.

Internal reporting system
We have implemented an internal reporting system atZeon to gather information about potential risks at an earlystage and make it easier to address them. In addition to ourinternal reporting line, we have also set up a reporting linewith external lawyers.
The Risk Management Committee investigates the factsof reports that are made and responds as appropriate, suchas by instructing the internal organization to implement
countermeasures based on the results of the investigation.

▶Our response to COVID-19 can be foundon P. 5●Internal reporting flow
Internal
Superior

External
Risk Management
Committee

External lawyer
reporting line

Review of facts andimplementation ofcountermeasures

Receive report,
record facts,
notify of result

Whistleblower
Discovery of risks
Discovery ofcompliance violations

Compliance Hotline

Report or notification
Feedback

ZEON GROUPCORPORATE REPORT 2020

34

Zeon’s Business and Strategy

Directors and Officers (as of July 1, 2020)
Visit our corporate Corporate Governance Report (PDF)
website for more
http://www.zeon.co.jp/csr_e/management.html
information

Director
Director & Senior Corporate Officer

President

Kimiaki Tanaka

Hiroyuki Hirakawa

Elastomers and Chemicals Business
Division Manager – Logistics

ProfileProfileDirector & Senior Corporate Officer

Director & Corporate Officer

Production and Engineering Technology
Division Manager – Production Center
General Manager – Production Administration

Administration,
Division Manager – Human Resources,
General Manager – Human Resources,
General Manager – China Business Administration
Director – Tohpe Corporation

April 1979 Joined Zeon
June 2005 Zeon Director
June 2007	‌Zeon Director andCorporate Officer
June 2011	‌Zeon Director and SeniorCorporate Officer
June 2012	‌Zeon Director andExecutive Corporate Officer
June 2013	‌Zeon President (current)

Toru Nishijima

ProfileProfileDirector

Director

Outside Director – Kobe Steel, Ltd.
Chairman of the Board

Senior Advisor –The Yokohama Rubber Co., Ltd.

Adviser – Fuji Electric Co., Ltd.

35

ZEON GROUPCORPORATE REPORT 2020

Kazuyoshi Matsuura

April 1981	‌Joined Zeon
June 2009	‌Zeon Corporate Officer
June 2013	‌Zeon Senior Corporate
OfficerJune 2014	‌Zeon Director and SeniorCorporate Officer (current)

Director

Haruo Itoh

April 1981 Joined Zeon
June 2008 Zeon Corporate Officer
June 2009	‌Zeon Director andCorporate Officer
June 2015	‌Zeon Director and SeniorCorporate Officer (current)

Takao Kitabata

April 1993	‌Joined Zeon
June 2017	‌Zeon Corporate Officer
June 2019	‌Zeon Director andCorporate Officer (current)

Tadanobu Nagumo

Audit & Supervisory Board

MemberMemberExternal Member

External Member

External Member

Chairman and Chief Executive Officer– ADEKA CORPORATION

Corporate Adviser – NIPPONTOCHI-TATEMONO Co., Ltd.

President –Asahi Mutual Life Insurance Company

Takeo Furuya

Shinichi Hirakawa

Akio Kohri

Nobutake Nishijima

Hiroki Kimura

Corporate Officer

Corporate Officer

Senior Corporate Officer

Senior Corporate Officer

Research & Development
Division Manager –Research & Development Center

Senior Corporate Officer – Specialty Business Manager – CSR Headquarters
Division Manager – CSR
Division Manager – Specialty Components
Manager – CSR Promotion
President – Zeon Korea Co., Ltd.
President – Zeon CSC Corporation

Corporate Officer

Corporate Officer

Corporate Officer

Corporate Officer

Corporate Officer

Plant Manager – Kawasaki Plant

Division Manager –Synthetic Latex

Division Manager –Corporate Planning

Division Manager –Synthetic Rubber

Division Manager –Electronics Materials

Tetsuya Toyoshima

Takafumi Kawanaka

Yoshiyuki Sone

Tsutomu Eguchi

Erisa Watanabe

Satoshi Tominaga

Corporate Officer

Corporate Officer

Managing Director of
Zeon Kasei Co., Ltd.

Plant Manager –Mizushima Plant

Tomoyuki Kose

Yoshinobu Oi

Makoto Watanabe

Yuichiro Konishi

ZEON GROUPCORPORATE REPORT 2020

36

Zeon's CSR

Zeon’s unique technology has dramatically reduced the electric power costs for illuminations—project LNES: the light-up ceremony for the 2019 Tokyo Tower Winter Illuminations(Solar card type lamp shown on the right)

Zeon’s CSR
We ensure compliance and conduct safe and stable production activities.
At our global business locations, we conduct business activities together with local residents
as a member of the local community.

Zeon’s CSR

P. 38

CSR Implementation Plan

P. 39

Environment

P. 41

Human Rights/Fair Operating Practices P. 42
Labor Practices

P. 43

Community

P. 45

37

ZEON GROUPCORPORATE REPORT 2020

Zeon’s CSR
Visit our corporate Zeon’s CSR
website for more
http://www.zeon.co.jp/csr_e/concept.html
information

At Zeon, we regard CSR activities as all activities undertaken to continue being“a company trusted and valued by society.” With all employees acting with anawareness of CSR, we ensure compliance and contribute to the global environmentand sustainable development through our corporate activities. In April 2010, weestablished the Zeon CSR Policy and the more specific CSR Code of Conduct. In
January 2011, we established our current CSR Management Framework.
The CSR Code of Conduct was revised in January 2018. This revision clearlyspecifies Zeon’s commitment to meeting society’s expectations, which represents
Zeon’s fundamental approach to CSR, and restructures the CSR activities that Zeon
undertakes.
Zeon CSR Policy (established April 2010)
1. We‌will ensure compliance and meet society’s needs for safety
and security
2. We‌
will contribute to sustainably developing society andprotecting the global environment through our corporate activities
3. We‌
will ensure that each and every Zeon person is aware of CSR
and acts accordingly

CSR Management Framework●Committee functions

The CSR Management Framework comprises the CSR Conference and eight
committees.
Chaired by the President and held six times a year, the CSR Conference is thechief decision-making body on matters relating to CSR. The CSR Conference isheld to review and finalize committee activities, initiatives, and annual activity
plans, and to give necessary instruction based on progress reports.
The committees report to the CSR Conference and advance CSR activities intheir specific areas. In October 2018, the Information Security Subcommittee,
which had been under the Compliance Committee, was placed under the CSR
Conference as the Information Management Committee to promote appropriate
information management for the Zeon Group.

Risk Management Committee
Responsible for systematically preventing
potential risks and handling risks thatemerge.

●Zeon’s CSR Management Framework
President

CSR Headquarters

CSR
Coordination Division

CSR
Promotion Department

CSR Basic Policy
Committee

CSR Promotional
Committees at Offices
and Group Companies

General Affairs
Department

Risk Management
Committee
CSR Conference

Quality Assurance
Department
Antitrust Law
Regulatory Subcommittee

Legal Affairs
Department

Information Management
Committee

Export Security Control
Subcommittee

Department ofCorporate
Communications

Environmental & Safety
Affairs Committee

Corporate Governance
Subcommittee

Compliance
Committee

Quality AssuranceCommittee
PL Committee
Public Relations
Committee

CSR Basic Policy Committee
Provides guidance and support for CSR
Promotional Committee activities. Builds
systems to support making social
contributions.

Compliance Committee
Education and training in legal
compliance. Oversees three compliancesubcommittees.
Information Management Committee
Plan and implement Group-wide information
management and information security
measures. This includes audits of information
systems and information security education.
Environmental and Safety Affairs Committee
Plans and proposes environmental andsafety measures and monitors theirprogress.
Quality Assurance Committee
Activities related to quality assurance.
Reviews, takes action on, and make
improvements to QA problems.
PL Committee
Manages prevention activities, training,and emergency response related to
product liability.
Public Relations Committee
Deliberates on the strategy for the Zeon
Group’s PR activities, and on related activity
planning, and discloses necessary
information at appropriate times.
ZEON GROUPCORPORATE REPORT 2020

38

Zeon’s CSR

CSR Implementation Plan
The Zeon Group’s CSR Implementation Plan has been formulated on the basis of ISO 26000, the international standard for
CSR. The CSR Implementation Plan specifies the progress that needs to be made in order to realize the Enterprise Blueprintfor 2020, in terms of ISO 26000’s Seven Core Subjects. The CSR Implementation Plan shows what measures the Zeon Groupis implementing in relation to the Seven Core Subjects, which embody society’s expectations.
In the future, we will further the dissemination of the CSR Implementation Plan both within and outside the Zeon Group,
and implement activities aimed at helping all stakeholders to understand Zeon’s CSR measures.

Structure of Zeon Group’s CSR Implementation Plan
ISO 26000
Seven Core
Subjects

Enterprise Blueprint for 2020 =To meet the expectations ofsociety

Activities currently
being implemented

Items for future
implementation

Society’s
expectations

Zeon Grouptargets

Initiatives toachieve our goals

Remaining challenges to achieve
the Enterprise Blueprint for 2020

Initiatives for the Enterprise Blueprint for 2020
While addressing the remaining challenges stated as“Items for future implementation” in the CSR
Implementation Plan, we will monitor how close we are to
the Enterprise Blueprint for 2020. We will then consider
what we need to do next to achieve the Enterprise Blueprintfor 2020 and update the items for future implementation.

Enterprise Blueprint for 2020

Zeon makes the Future Today
through the Power of Chemistry

Zeon will continue to contribute to the realization of customer
dreams and a prosperous society through employees’ individual growth.

Formulating the Enterprise Blueprint for 2030 CSR Matrix
As noted above, the Zeon Group formulated the Enterprise Blueprint for 2020 and related targets in relation to ISO
26000’s Seven Core Subjects, and has been implementing progress management. While it is anticipated that the Enterprise
Blueprint for 2020 will, broadly speaking, be realized by comparison with the situation 10 years ago when the Blueprint wasformulated, there have been major changes in terms of what society now expects from business enterprises. With thegrowth of ESG investment, the focus on the 17 Sustainable Development Goals (SDGs) and other sustainability objectives,
CSR perspectives have become diversified, and there has been a transformation in how issues are weighted and prioritized.
With this in mind, in order to establish new goals for 2030 and focus on the SDGs, the Zeon Group has formulated an
Enterprise Blueprint for 2030 and new targets, so as to further develop the issues and targets that were enunciated in theEnterprise Blueprint for 2020. It is anticipated that the new CSR Matrix will demonstrate linkage with the 17 SDGs.
More specifically, ways in which corporate activities contribute towards the realization of the 17 SDGs will be identified,
and the extent of the contribution made will be quantified. By reviewing the materiality and setting quantitative andqualitative goals linked to the company’s business plan, we will implement progress management with respect to therealization of the Enterprise Blueprint for 2030.
Through the implementation of activities aimed at the realization of these goals, we aim to be able to share our resultswith the many other enterprises and organizations in the world that seek to make a contribution towards the SDGs.

39

ZEON GROUPCORPORATE REPORT 2020

Correlation between the SDGs and Zeon’s business activities
A large number of people and organizations are involved in the supply
chain, from obtaining the raw materials to production and product supply
that form Zeon’s business activities. In this process, there are areas where
we can exercise our influence. Many of our products are also used in otherproducts, including automobiles and buildings. There are ways in which
our value can contribute to resolving issues faced by society.
Zeon is a company that provides materials to companies, and wecontribute to resolving issues faced by society throughout all of ourbusiness activities.
A. Contributions through our actions in the
supply chain, from securing raw materials
to production and product supply

ZEON
B. Contributions through products andprovided value using Zeon products

17 SDGs in Zeon’s value chain
This shows how the 17 SDGs are oriented in the Zeon Group’s value chain. We will review this relationship for each businessgoing forward.

Polymerization
technology
Synthesis
technology

Extraction
technology
GPB
GPI

NaphthaC4
C5

Raw materials

Butadiene
Isoprene
Dicyclopentadiene
Piperylene
2-butyne
Materials
extraction

Strengthening

positive effects

Synthetic rubber and synthetic latex
Chemicals
Specialty chemicals
Tires, Automobile components
Synthetic aroma chemicals
Gloves, Adhesives, Paints/coatings
Cyclo Olefin Polymers
Fragrances, Large-size molding products
Optical films
Lenses, TVs, Smartphones
Battery binders, etc.
Batteries, etc.

R&D
Manufacturing

Contributions throughbusiness activities

Sales

Processing
Embedding in
final products

Final
product use

Final productdisposalContributions throughfinal products

Through activities to contributeto the SDGs, we are able todevelop our business in line withthe public’s expectations andcreate corporate value.

Minimizing

negative effects
Recognizing that not conducting
activities to contribute to the SDGs runs
the risk of damaging our corporate
management and corporate value, we
seek to minimize these effects.

Society,
Environment,
Governance

ZEON GROUPCORPORATE REPORT 2020

40

Zeon’s CSR

Environment

Visit our corporate Environment
website for more
http://www.zeon.co.jp/csr_e/environment.html
information

Environmental CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society
Further improving how society sees us by
reducing our environmental impact andpromoting energy conservation

Details of current activities(■: Completed, △: Ongoing)

Future initiatives and targets‌△ Reduce emissions of hazardous substances, reduce
impacts on atmospheric and water environments,
and conduct PRTR activities‌Improve energy conservation in Responsible△
Care audits, the Safety Management System,
the Environment Management System basedon ISO 14001, and the Energy Conservation
Implementation Committee△ Develop and launch products that contribute to
reducing environmental impacts and conserving
energy (including S-SBR for fuel-efficient tires, lowtemperature fixing toners, cleaning solvents andetching gases with zero ozone depletion potential,
and binders for lithium-ion rechargeable batteries)△ Green procurement activities (check whether
substances contain banned substances andsubstances that are regulated by laws andregulations and the RoHS Directive, etc.)

1. ‌Implement activities group-wide to reduce
environmental load
2. ‌Conduct environmental management using
the multiple systems noted on the left
3. Research and development that addressenvironmental issues faced by society
4. Examine the sustainability of resource
procurement including oil and water

Reducing environmental impacts
We comply with emissions standards for substances with environmental impact
based on the Japanese Energy Conservation Act, Air Pollution Control Act, Water
Pollution Control Act, PRTR Act, and agreements with local authorities (voluntary
management standards).
We are taking steps to continue reducing our per-unit CO2 emissions by anaverage of 1% per year compared with FY 1990.

Per-unit CO2
emissions(FY 1990 comparison)
FY 2019●CO2 emissions and Per-unit CO2 emissions (FY 1990 comparison)
CO2 emissions

×103 t-CO2

Per-unit CO2 emissions

1,000

-32%

100%

800

80%

600

60%

400

40%

200

20%

0

1990

2009

2010

2011

2012

2013

2014

2015

Developing environmentally friendly products
At Zeon, we are continuing to conduct R&D with the objective of developing
and launching environmentally friendly products.
Up to FY 2018, we have successfully developed S-SBR for fuel-efficient tires,low-temperature fixing toners, cleaning solvents and etching gases with zero
ozone depletion potential, and binders for lithium-ion rechargeable batteries.
In the years ahead, we will continue to engage in R&D that attempts to addressenvironment-related social issues.

41

ZEON GROUPCORPORATE REPORT 2020

2016

2017

2018

2019

0%

Human Rights

Visit our corporate Human Rights
website for more
http://www.zeon.co.jp/csr_e/humanrights.html
information

Human Rights CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society
Sharing respect for human rights within Zeon
Group and in the supply chain• The section on respect for the Zeon Group‌
Human Rights Policy has been shared with
all Zeon Group companies and Zeon Groupbusiness partners, and compliance with theprohibitions on child labor and forced labor
are confirmed

Details of current activities(■: Completed, △: Ongoing)■B‌ ecome a signatory to the United Nations
Global Compact■E‌ stablish the Zeon Group Human Rights
Policy△ Continue conducting CSR education
including holding CSR informationalsessions and confirming understanding
through e-learning

Ensuring compliance is established as the first priority of the Zeon CSR
Policy, and we will meet the public’s expectations by having all employees act
with awareness of CSR. We endeavor to engage in fair operating practices, and
our CSR Code of Conduct clearly defines related matters including compliancewith antitrust regulations and a prohibition on entertaining and offering gifts tooverseas civil servants.
The Compliance Committee advances Zeon’s compliance efforts. The
Compliance Committee has three subcommittees, namely the Antitrust Law
Regulatory Subcommittee, the Export Security Control Subcommittee, and the
Corporate Governance Subcommittee. Each subcommittee is performing its
function.
In July 2019, we became a signatory to the United Nations Global Compact,
and in August 2019 we established and released the Zeon Group Human Rights
Policy. We strive to be a company that understands and accepts diverse values,
and where no person is discriminated against based on gender, age, nationality, orother attribute.

Fair Operating Practices

Future initiatives and targets
1. ‌Promote activities aligned with the Ten
Principles of the UN Global Compact andthe Zeon Group Human Rights Policy
throughout Zeon Group.

●Compliance system
Compliance Committee
Prevention of law violations
Education and training incompliance with laws
Antitrust Law
Regulatory Subcommittee
Prevention of violations of
the Antitrust Law
Export Security
Control Subcommittee
Proper security export control
Corporate Governance
Subcommittee
Reliability in financial reporting

Visit our corporate Fair Operating Practices
website for more
http://www.zeon.co.jp/csr_e/suppliers.html
information

Fair Operating Practices CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society

Details of current activities(■: Completed, △: Ongoing)

Ensuring compliance and ethical corporate
activities• Compliance awareness is established, and‌
Zeon acts with high ethical standards basedon being a model for society• ‌Information is disclosed quickly andappropriately, and market value has
increased• ‌Appropriately manage confidential
information including trade secrets andpersonal information• ‌Select business partners based on
the CSR Procurement Guidelines andperiodically confirm the Guidelines’ status of
implementation•P‌ romoting understanding on the handling ofintellectual property rights△ Enact and implement the Management Ruleof Insider Trading and Timely Disclosure△ Comply with internal regulations including
the Export Security Control Rules△ ‌Appropriately implement regulations to comply with
the Act on Prohibition of Private Monopolizationand Maintenance of Fair Trade (Antimonopoly Act)△ ‌Compliance with the Subcontract Act and the Act for
Securing the Proper Operation of Worker Dispatching
Undertakings (prevention of falsified contracts)‌ uild a system that prohibits bribes△B△ ‌Conduct CSR education including holding CSR
informational sessions and legal compliance inspections△ ‌Promptly disclose information (websites, briefings)‌Operation of information management systems△△ ‌Purchasing following the CSR Procurement Guidelines■ I‌ nstitute regulations on intellectual property
rights and intellectual property management

Future initiatives and targets
1. Ongoing compliance education
2. Shift from compliance to sustainability withfocus on the SDGs (promote understanding
among management and establish among
employees)
3. To enhance the corporate brand and value‌ ・Improve the website (IR, CSR information)‌・Strengthen the information communications
structure (PR)‌・Communicate information responsive to
ESG investing (including CDP)
4. Raise compliance awareness in the supply
chain by continuing to conduct the CSR
procurement questionnaire* ‌QCD: System of production management that
●CSR Procurement
controls and improves quality, cost, and delivery.
We have established the CSR Procurement Guidelines and Requests to Suppliers, which integrate
CSR perspectives into our existing QCD*, and are taking steps to ensure CSR procurement.
We are conducting a survey of human rights measures at our business partners, and are working
to build a supply chain CSR survey database. Based on this database, we will survey whether
there are problems including with the work environment (human rights, health and safety, etc.),
environmental destruction, and conflict minerals, and will collect and disclose information about our
supply chain.
Looking ahead, we will consolidate our approach to supply chain management and build a system
for sharing our CSR policies in order to embed CSR procurement throughout the supply chain.
ZEON GROUPCORPORATE REPORT 2020

42

Zeon’s CSR

Labor Practices

Visit our corporate Labor Practices
website for more
http://www.zeon.co.jp/csr_e/employee.html
information

Labor Practices (Employment) CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society

Details of current activities(■: Completed, △: Ongoing)

Future initiatives and targets

Balancing individuals’ work and private life
・Balance is achieved between individuals’
work and personal life.
・Create workplace environments in whichpeople are motivated to perform bypromoting diversity, implementing fair hiringand personnel systems, and encouraging
dialogue.

■ ‌Introduce flex-time systems■ ‌Advancement of measures to support
raising the next generation■C‌ hildcare support systems (shortened working
hours, overtime restrictions and exemptions,sick care leave, working daycare hours, etc.)‌Return-to-work program for employees△
taking childcare and caregiving leave△ ‌Active hiring of women, non-Japanese employees‌Implementation of employment for people with disabilities△△ Expand re-employment system for employees
reaching the age of mandatory retirement△ Support for employee skills and career development△ Initiatives for harassment prevention△ MD Committee activities by women members

1. ‌Further pursue dynamic work styles
2. ‌Create an environment that encourages
taking of child and family care leave
3. ‌Introduce a work-from-home system
4. Promote diversity-oriented management
・‌Further expand employment not tied togender, nationality, race, age, disability, orother attribute・‌Appoint more women employees tohigher positions・‌Initiatives to prevent harassment andimprove communication competence・‌Advance employment of older persons
5. Develop an education system and expanded
curriculum

Employment and diversity
Zeon Group respects diversity and strives to be a company in which everyone
in our diverse team of employees is able to fully demonstrate their capacities. Our
employees today have a range of backgrounds and perform their duties regardlessof gender, age, and nationality.
We conduct diversity training for all employees to help create the capacity fordiversity understanding. We also support employees who are balancing workwith raising children and have acquired the Kurumin mark in Japan in recognitionof this, based on the Act on Advancement of Measures to Support Raising NextGeneration Children.

TOPICS

Advancement of women
In the action plan (plan period until March 2018) for
general business operators in the Act on Promotionof Women’s Participation and Advancement in the
Workplace, we established targets for the issue
of increasing the number of women employees.
Based on our new plan, we will promote women’s
advancement from FY 2018.

New action plan targets
Target 1: ‌Achieve 30% women hires among
new graduate hires
Target 2: ‌Conduct career plan workshops
Target 3: ‌Increase understanding fordiversity management

HR development
Zeon’s concept of “being the worker I want to be” embodies “persons tocontinually evolve by pursuing high goals based on independent thinking.”
Personnels are encouraged to set goals to become the worker they want to be,
and we are modifying our education and training systems to allow them to bridge
the gap between the current reality and their goals and facilitate goal-driven
actions on a daily basis. By fairly evaluating what employees have accomplishedand rewarding them accordingly, we aim for them to set even higher goals. With
every personnel continuing to improve and demonstrating this in actions, we cancreate an even more capable workforce across Zeon.

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ZEON GROUPCORPORATE REPORT 2020

●HR development at Zeon
Performancebased reward
The worker
I want to be
Evaluation

Education& training

Actions &results

The worker
I want to be(higher goals)

Education& trainingOccupational safety
Labor Practices (Occupational Safety) CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society

Details of current activities(■: Completed, △: Ongoing)

Promise of feelings of reward, safety, andsecurity at work
・Health management
Place priority on individuals’ physical andmental well-being, and support improved
health・Disaster prevention
All worksites have earned public trust by
maintaining a safety record of zero incidents
and accidents
・Safety education

・Health management△ Promotion of health management
・Ensure labor hours management toprevent excessive work
・Provide guidance on preventing lifestylediseases and stress check tests
・Disaster prevention△ Conduct emergency drills and otherinitiatives such as concluding disastercooperation agreements△ ‌Implement the Safety Management
Improvement Master Plan
△ ‌Fully implement deterioration
countermeasures and identify foolproof
measures, and horizontally implement
measures arising from cases of accidents atother companies and plants△ ‌Eliminate safety incidents: Regularly
conduct plant safety evaluations and audits
・Safety education△ ‌Provide education to enhance accident
prevention awareness, including education
using accident case studies and hands-on
training△ ‌Promote the 5S’s→3S’s

A consistently safe work environment is the foundation of all production
activities. We formulated our Safety Philosophy in 1997 based on the Responsible
Care approach to guide our safety activities. Our Responsible Care Policy establishedin 1998 also clearly states, “Protecting the environment and ensuring safety arepreconditions for all business activities and are the most important priorities.”
Our goal is zero occupational accidents resulting in lost work time and zero
serious accidents without lost work time. There were two lost-time occupational
accidents in FY 2019. We are focusing on communication between worksite
supervisors and workers, safety inspections, and hands-on education in order toachieve a safe and stable production system.

Future initiatives and targets
・Health management
1. Further promotion of health and productivity
management (Continue to be selected as aWhite 500 company, Enhance mental healtheducation, and Implement further healthpromotion initiatives)
・Disaster prevention
1. Implement four safety activities conducted
throughout Zeon Group in the supply chain
・Safety education
1. Implement the safety education and 3S’s
conducted throughout Zeon Group in the
supply chain

TOPICS

Holding the Zeon North Safety
Conference (every May)
The primary business of Zeon North is plantengineering for the Zeon Group. Zeon North holds
a safety conference for representatives of partnercompanies to deepen cooperation with them,enhancing safety awareness, spreading safetyknowledge, and sharing information. Zeon North
works together with all of its partner companies
with the goal of building a culture in which all onsite workers have a strong awareness of safety andsafety is always given the highest priority.

Safety and accident prevention
We conduct safety assessments and audits of plants, and provide training toenhance accident prevention awareness with the goal of achieving zero safety
irregularities.
Each year, top management develops a Master Plan for Safety Management
Improvements and leads initiatives to improve our Safety Management System
based on the belief that ensuring safety is the greatest priority. Senior managers
at Zeon visit plants on a regular basis to confirm the progress of improvement
initiatives and hold informational meetings with workers to communicate directlywith them. Top management visited plants over 46 days in FY 2019.

Zeon North Safety Conference

Safety in logistics
We are working to maintain our achieved goal of zero accidents in logistics.
At Zeon, we established Yellow Card Management Rules for transporting
hazardous products. These rules require drivers to carry a Yellow Card*1 whentransporting such products. We also conduct reporting and communication
training for drivers, and each plant offers training on product handling to prevent
accidents in logistics.

Zeon North Education Center*1 ‌Yellow Card: Document describing what to do if
an accident occurs during transportation, asestablished by the Logistics Safety Management
Policy of the Japan Chemical Industry
Association. The document is called a Yellow
Card because it is printed on yellow paper.

ZEON GROUPCORPORATE REPORT 2020

44

Zeon’s CSR

Community

Community
Visit our corporate http://www.zeon.co.jp/csr_e/community.html
website for more
Site Reports
information

http://www.zeon.co.jp/csr_e/sitereport.html

We believe that contributing to the development of local communities and building strong relationships of trust are crucial
to conducting stable business activities and creating improved products and services.

Zeon’s approach to social contributions
We believe that social contributions are essentially
carried out through our core businesses. As companies
are members of society, however, the complex set ofissues faced by society and a company’s activities are notindependent of one another. We are therefore undertakingsocial contribution activities outside of our core businesses
to engage with society from a broader perspective.
In 2012, we launched CSR Core Projects, which are
initiatives we selected from proposals submitted by Zeon
Group companies. CSR Core Projects are activities that
focus on social contributions outside the scope of our corebusinesses and provide employees with opportunities toturn their attention to social issues.
The Head Office plans various activities related tosupporting reconstruction from the Great East Japan
Earthquake, as well as shared projects that are conductedacross multiple plants and subsidiaries. Furthermore,
plants and subsidiaries also conduct their own independent
projects. We are developing activities in these three broad
categories with a focus on their synergistic benefits.

●Social contributions at ZeonCSR Core Projects

Great East Japan
Earthquake reconstruction

Shared projects

Independent
projects

Community CSR Matrix (Excerpt)
Enterprise Blueprint for 2020
To meet the expectations of society

Details of current activities(■: Completed, △: Ongoing)

Building positive relations through activities
to foster coexistence with local communities△ ‌Develop CSR Core Projects (social
contribution activities by Group as a whole,among locations, and at individual worksites)△ ‌Maintain good community relations andhave community exchanges•S‌ ponsor and participate in community festivals
and events including summer festivals at plants• ‌Community cleanup activities• ‌Plant tours (receive plant visitors, internships)

FY 2019 initiatives❶ Activities with the local community
Each worksite and Group company engages in dialogue with the local
community and conducts charity activities to become an establishedpresence in the community and facilitate smooth business operations.
Zeon Chemicals (Thailand) Co., Ltd. conducts communication activities
with the local community, participates in local events, and makes charity
donations.

45

ZEON GROUPCORPORATE REPORT 2020

Future initiatives and targets
1. Develop the CSR Core Projects based on adefined Zeon Group activity policy
Review social contribution activities(Whether to revise the recipients or the targets,and in the case of the targets, revise from theviewpoint of contributing to the 17 SDGs)
2. Maintain and expand exchanges with local
communities
3. T hrough dialogue with stakeholders including
local communities, identify expectations
from society, the current level of meeting
those expectations, and set targets

❷ Holding community events❸ Cleanup campaigns

Zeon places great importance on connections with local
communities. Zeon’s plants and Group companies hold various
events including summer festivals and welcome opportunities toparticipate in community events.

With the goal of conducting activities that are beneficial and willplease local communities, Zeon’s plant and Group companies
conduct community cleanup campaigns around their sites andbeyond.

Yamaguchi
Broadcasting Co., Ltd

Every year, Zeon Corporation’s Tokuyama Plant organizes the Zeon Waraku Odori Dance
Festival. In FY 2020, the festival was canceled as part of our response to the COVID-19
epidemic. Instead of holding the festival, 1 million yen was donated to Shunan City.

❹ Educational support
Zeon’s plants and Group companies offer assistance to educational
institutions with internships for high school, vocational high school,
and university students, by welcoming plant tours for school groups,
and by sending special instructors to give lessons at schools.

In Thailand, Zeon Advanced Polymix Co., Ltd. (ZAP) conducts volunteer
cleanup activities not only in the vicinity of the plant, but also at local
temples and neighboring public facilities.

❺ Presentation of the PJ ZEON Awardfor outstanding academic papers

In 2005, Zeon Corporation established the PJ ZEON Award as partof the Award for the Outstanding Paper Published in the Polymer
Journal (PJ Award), organized by The Society of Polymer Science,
Japan (SPSJ). Every year, the PJ ZEON Award is presented to honor
an outstanding academic paper published in the Polymer Journal.
The purpose of the PJ ZEON Award is to encourage researchby young scientists. Award-winners are chosen by a selection
committee of third-party experts who have no connection with
Zeon Corporation’s business activities.
https://main.spsj.or.jp/c15/pjzaward/pjzjyuichiran-e.htm
The Award-winners have the opportunity to engage in discussion
and exchange of ideas with Zeon Corporation’s young researchers.

The Tohpe Corporation, holds plant tours for parents and children at its
Ibaraki and Kurashiki plants.

❻ Chemistry classrooms❼ Volunteer tours to provide support for

Based on the motto of “nurturing future Nobel Prize winners inchemistry,” we are holding chemistry experiment classrooms invarious areas to communicate the appeal of chemistry to children.

Since 2012, Zeon Corporation has continued to organize volunteer
tours to support recovery in areas affected by the Great East
Japan Earthquake of 2011.

Zeon Chemicals Yonezawa participated in the 2019 Youth Science Festival
in Yamagata. Children made aromatic air fresheners using our synthetic
fragrances.

Four tours were held in FY 2019, with a total of 65 volunteers participating.
Tour participants traveled to Ishinomaki, Minami-sanriku and Kesennuma toprovide support for fisheries and agricultural work, while also visiting the
local history museums to experience earthquake education programs.

disaster-affected areas

ZEON GROUPCORPORATE REPORT 202046

Cover photo:
Zeon Corporation Takaoka Plant
Established in 1956, this plant isleading Zeon Group producing
specialty synthetic rubbers andsemiconductor-related products.
The affiliated companies Optes
Inc. and Zeon Medical Inc. arealso located in the same area.
This plant has an R&D focus, with
the Precision Optics Laboratory,
Production Technology Laboratory,
and Medical Research Instituteoperating within it. This enables
greater integration between
research and manufacturing toshorten the product development
timeline.
Main products
Specialty synthetic rubbers,
semiconductor-related products

Zeon Corporation
CSR Promotion Department

Shin Marunouchi Center Building, 1-6-2 Marunouchi, Chiyoda-ku, Tokyo 100-8246, Japan
Tel: +81-3-3216-0603 Fax: +81-3-3216-0604 http://www.zeon.co.jp/index_e.html

Printed on paper made with woodfrom forest thinning. “Morino ChonaiKai” (Forest Neighborhood Association)
supporting sound forest management.