DIC REPORT 2022
The DIC Group Integrated Report

“The DIC Way” was formulated to represent the
DIC Group’s fundamental management philosophy.
In line with The DIC Way, the DIC Group willcontinue to promote efforts aimed at enhancing
corporate value and achieving sustainable growth.

The DIC Way
MissionWe create enhanced value and utilize innovation to introduce
socially responsible and sustainable products.

VisionMissionWe improve the human condition by safely delivering color
comfort for sustainable prosperity — Color & Comfort

Core Values

Core Values
Enterprising: Lead with a passion for excellence that is evident in thesolution-focused actions taken each day to drive value through innovation.*
Integrity: Be honest, forthright, and ethical in all dealings with customers,
suppliers, and coworkers.*

Enterprising

VisionIntegrity

Dedication & Loyalty: Take responsibility for performance in the ofﬁce,
laboratory, and factory, by demonstrating commitment to customers,
suppliers, and coworkers.*
Diversity: Respect other viewpoints and work collaboratively whilevaluing collective goals over personal interests to achieve excellence;
foster communication and cooperation with people from all backgrounds.*
Social Responsibility: Go beyond compliance to promote products andactivities that achieve socially responsible and sustainable developmentthat protect the environment.*

Sustainability

Dedication & Loyalty

Company

Diversity*=Annotation

Our Redeﬁned Vision Statement
We have redeﬁned our Vision to express our goals to deliver greater value through broader innovation,
improving the human condition and promoting sustainability for a brighter future.

1̲ DIC Report 2022

Social Responsibility

Society

Contents
Connecting the DIC Group and its Stakeholders
The DIC Group uses a variety of tools to promote communication withits many stakeholders to encourage greater awareness of the Group’s
activities. More detailed sustainability-related information and data canbe found on the DIC global website.

Printed/PDF-Form Publications

Reports on activities
DIC Report

DIC Report(summary version)(complete version)

DIC Report
Financial Section

Value Creation Essentials

DIC Group Communications Tools

DIC Group Milestones
The DIC Group’s Approach to Value Creation
Fiscal Year 2021 DIC Group Topics)LQDQFLDODQG1RQÀQDQFLDO,QIRUPDWLRQThe DIC Group: A Global Powerhouse
A Message from the President
DIC Vision 2030 Long-Term Management Plan
12-Year Summary
A Message from the CFO
The DIC Group’s Business Portfolio
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5
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25
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Summary integrated
report (published annually)(PDF-form publication)

Complete report(published annually)(PDF-form publication)

Report on resultsof operations and¿QDQFLDOFRQGLWLRQ
(published annually)(PDF-form publication)

DIC Global Website

Real-time information
https://www.dic-global.com/en/
Umbrella website providing information to
the global public about the DIC Group andreports on its various activities; updated
as necessary
WEB

Value Creation Strategies

Activities

In previous years, the DIC Group published a combined corporate
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easy-to-understand picture of the Group and its sustainability
initiatives. Since 2017, the Group has published the DIC Reportas an integrated report, which combines financial information,encompassing consolidated operating results and corporate
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which focuses on key highlights, and a more detailed complete
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Link with the DIC Global Website

Value Creation Cornerstones

About this Report

7KH WEB PDUNLQGLFDWHVWKDWPRUHGHWDLOHGLQIRUPDWLRQDQGordata can be found on the indicated page of the DIC global website.
DIC global website WEB https://www.dic-global.com/en/

Scope of Reporting

Reporting Period)LVFDO\HDU -DQXDU\±'HFHPEHU

Data

In principle, this report provides information on DIC Corporation and consolidated
DIC Group companies worldwide. For information on the scope of reporting for
ESH-related initiatives, please visit the pertinent page of the DIC global website.
WEB https://www.dic-global.com/pdf/csr/environment/dic_report_scope_en_2022.pdf

Sun Chemicalʼs Activities',&$VLD3DFLILFʼs Activities
DIC China ʼs Activities
A Message from the General Manager of the Production Management Unit
A Message from the General Manager of the Technical Management Unit
A Message from the General Manager of the R&D Management Unit

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38

Special Feature

Helping Realize Sustainable Mobility Solutions

Functional black pigments that combine outstanding LiDAR signal response and visual appeal:RUOG¶VIDVWHVWFXULQJFDUERQ¿EHU±UHLQIRUFHGSUHSUHJDICARBO® LF series
Contributing to the Realization of a Circular Economy
Work Style Reforms: Activities of the WSR 2020 Committee
A Message from the Head of the ESG Unit
Overview of Materiality
DIC Sustainability Index
Corporate Governance'LUHFWRUV$XGLW 6XSHUYLVRU\%RDUG0HPEHUVDQG([HFXWLYH2IÀFHUV
A Message from an Outside Director

Overview of Sustainability

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59
61
62

Compliance
BCM and Crisis Management
Information Security(QYLURQPHQW6DIHW\DQG+HDOWK (6+Climate Change
Quality
Human Resources Management6XVWDLQDEOH3URFXUHPHQW
New Value Creation6XVWDLQDEOH7HFKQRORJ\DQG3URGXFW'HYHORSPHQW
Digital Transformation
Harmony with the Community and Social Contributions
Communication with Stakeholders
Financial Report for Fiscal Year 2021
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70
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76
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78
79
80
81
88

Date of Publication

Cover Design-XQH 7KHQH[WUHSRUWLVVFKHGXOHGIRUSXEOLFDWLRQLQ-XQH

The cover of this year’s DIC Report takes its
inspiration from the natural world, employing
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goals of delivering greater value through broader
innovation, improving the human condition andpromoting stability for a brighter future.

Guidelines Referenced
Guidelines referenced in the preparation of this report were ISO 26000, theInternational Organization for Standardization’s standard for social responsibility,
UHOHDVHGLQ-DSDQ¶V5HVSRQVLEOH&DUH&RGHDQGWKH*OREDO5HSRUWLQJ,QLWLDWLYH *5, ¶V*5,6WDQGDUGVDIC Report 2022 ̲2

1925

1908

Begins production of organic pigments
Develops production method for organic pigments
and begins production for its own use, the first step inits evolution as a fine chemicals manufacturer.

Established by Kijuro Kawamura
as Kawamura Ink Manufactory;
adopts the dragon as its
product trademark and begins
manufacturing inks.

Changes Company nameto Dainippon Ink and Chemicals
Embarks on a new chapter in its history by absorbing
Japan Reichhold Chemicals Inc., and changes Company
name to Dainippon Ink and Chemicals Incorporated (DIC).

1940

Commences production ofwater-based gravure inks
Dragon product trademark

Amid wartime restrictions on use of volatile oils, develops
water-based gravure inks—one of several achievementsthat would later facilitate expansion into synthetic resins.

DIC’s previous
corporate symbol

1952

1968

Establishes Japan Reichhold Chemicals Inc., then thesecond-largest joint venture with an overseas firm in thehistory of the Japanesechemicals industry,
and makes a full-scale
entry into the synthetic
resins business.

Launches the DIC Color Guide®, which becomes the defacto standard for color selection in numerous industries,
bolstering recognition of the DIC name.

Makes full-scale entry into thesynthetic resins business

1915

Value Creation Cornerstones

Becomes one of the first companies to conduct
research in the area of offset printing inks and succeeds
in producing a viable product in only one year.

Sustainability Initiatives

Promotes expansion of
printing inks business

1973

Establishes theEnvironment and Safety
Response Department
Creates department under the directsupervision of DIC’s president to oversee
safety and environmental initiatives(today’s Responsible Care Department);
creates Environment and Safety
Management Regulations and Interim
Emergency Countermeasures Department
and begins promoting decisive efforts,
including the implementation of plantsafety inspections.

3̲ DIC Report 2022

Commences sales of the
DIC Color Guide ®

Reichhold Chemicals’
San Francisco plant

DIC’s founder, Kijuro Kawamura

Commences production of offset printing inks

Data

1962

DIC Color Guide ®

1957

1970

Enters the plastic products business with the aim of becoming an
integrated manufacturer with operations encompassing productionof everything from plastic raw materials to finished products.

Establishes Crown Zellerbach Packaging Materials Japan
Co., Ltd., in a joint venture with Crown Zellerbach
Corporation of the United States and Nippon Kakoh Seishi
Co., Ltd., and enters the multilayered films business.

Enters the multilayered films businessEnters the market for helmets andother molded plastic products

Diversiﬁes operations by building onbase in printing inks, organic pigments
and synthetic resins

1990

Opens Kawamura
Memorial Museum of Art
Located in Sakura, Chiba Prefecture,adjacent to the Central ResearchLaboratories; established to exhibit
works of art collected by DIC and DIC
Group companies and now called the
Kawamura Memorial DIC Museum of Art.

Actively introduces technologies
from overseas and promotes
further diversif ication

1995

Declares intention to uphold theprinciples of Responsible Care

Takes an active role in the Responsible
Care movement since the start as one of
74 founding members of the Japan
Responsible Care Council (JRCC);
reinforces efforts to, among others, reduce
negative environmental impact ofoperations and lower energy consumption.

2006

Becomes signatory to the
Responsible Care Global Charter
Signs the CEO’s Declaration of Support for
the Responsible Care Global Charter,
established by the International Council of
Chemical Associations (ICCA), as befits its
status as a member of the global communityof fine chemicals manufacturers.

Certiﬁcation of DIC as signatory to
the Responsible Care Global Charter

114 Years of Achievement

Established as
Kawamura Ink
Manufactory

Value Creation Strategies

Value Creation Essentials

DIC Group Milestones

2008

Introduces branding program

Changes Company nameto DIC Corporation
Marks centennial anniversary by changing Company name to
DIC Corporation and adopting a new corporate symbol.

Nematic LCs

Acquires the graphic arts materials division of
Sun Chemical Corporation of the United States
Becomes world’s largest
manufacturer of printing
inks in terms of market
share and a leading namein the graphic arts materials
business.

2017

DIC’s new corporate symbolEnters capital and business alliancewith TAIYO HOLDINGS
Concludes capital and business alliance with TAIYO HOLDINGS CO., LTD.,
one of the world’s leading manufacturers of solder resist for printed wiring boards.

2008

Develops groundbreaking series ofgreen pigments for LCD color filters
Develops the G58 series of green pigments for use in color filters forliquid crystal displays (LCDs), which deliver marked increases inbrightness and contrast compared with previous products andcontribute substantially to reduced energy consumption by LCDs.

Sun Chemical’s headquarters

1999

2009

Amid rising awareness of environmental issues, develops
Japan’s first organic solvent-free sheetfed offset ink.

In October 2009, establishes a joint venture with Dai Nippon Printing
Co., Ltd., subsidiary The Inctec Inc. and integrates its domestic
printing inks business with the printing inks business of The Inctec.

Succeeds in developing 100% soybean
oil–based printing ink

Establishes DIC Graphics Corporation

Acquires Coates, the printing inks
division of France’s TOTALFINA
Establishes presence in India, Central and South America
and elsewhere by acquiring the Coates Group fromTOTALFINA S.A., France’s largest oil company.

Seeks to advance globalization ofcore businesses and diversify into new areas

2021

Acquires the Colors & Effects businessfrom BASF SE of Germany
Acquired a prominent global manufacturer of high-performance pigments,
effect pigments (for cosmetics) and specialty inorganic pigments, based inEurope and with sites around the world, bringing together proprietary
technologies and intellectual property that will unleash unparalleleddevelopment capabilities and yield exciting new products, as well as
improving efficiency by expanding operating scale and reinforcing the DIC
Group’s position as a leading global pigments manufacturer.

2022

2015

Completes reconstructionof corporate headquarters
in Nihonbashi

1999

In May 2015, completes the reconstruction ofi t s c o r p o ra t e h e a d q u a r t e r s — t h e D I C
Building—in Nihonbashi, Tokyo, the role ofwhich was expanded to include oversight of
the global DIC Group.

Inaugurates DIC Vision 2030 long-term
management plan
Announces redefined vision statement—“We improve the human condition
by safely delivering color and comfort for sustainable prosperity—Color &Comfort” and sets forth a new basic policy “Safely delivering Color &Comfort for sustainable prosperity to enhance shareholder value andlong-term corporate value.”

Takes steps to advance environmental
protection and expands global presence

Prepares for a new phaseof growth

2007

2010

2014

Begins promoting corporate social
responsibility (CSR) initiatives; identifies
fulfilling its responsibilities as a memberof society through its business activities
and contributing to the evolution ofsociety as the cornerstones of CSR.

In December 2010, becomes a signatory to
the United Nations Global Compact (UNGC),
with the aim of maintaining its reputation asa socially responsible corporate entity.

Clarifies its overall policy of achieving sustainability
in a manner that takes into account, among others,
the environment, ecosystems and socioeconomic
issues, and changes the designation used across its
program from “CSR” to “sustainability.”

Joins United Nations
Global Compact

2015

Changes designation to“sustainability”

In-house poster promoting sustainability initiatives

Launches CSR program

Brand advertisement for television

Value Creation Essentials

1986

Introduces new branding
program based on theGroup’s “Color & Comfort”
brand slogan, which sets
f o r t h t h r e e c o r p o ra t evalues, and in Octobera i r s a new television
advertisement.

Value Creation Strategies

Develops revolutionary
high-performance,long-lasting nematic liquid
crystals (LCs), commencing
its evolution into one oft h e w o r l d ’s f o r e m o s t
manufacturers of LCs.

2016

Selected for inclusion in the
Dow Jones Sustainability
Indices (DJSI) Asia Pacific Index
Included for the first time in the DJSI Asia
Pacific Index, a global family of indices forsocially responsible investing and abenchmark of global sustainability.
As of 2021, has been included in the index
for seven consecutive years

DIC Report 2022 ̲4

Value Creation Cornerstones

Enters themarket for LCs

Data

1973

The DIC Group’s Approach to
Value Creation
Delivering

Human rights
issuesCyber threats
Climate change

Diverse social imperatives

Management capital(Inputs)

Financial capital
Integrate technologies
and make use ofopen innovationschnologie
design teMaterials

ies

chnologComputational science(AI and MI*), Analysis
Applicability
assessment

Polymer design(Coating, printing,molding)

Organic materials
designrm
Re

Ability to value diversity andto bolster satisfaction
and productivity

Dispersion

design te

Common basic
technologies

Inorganic
materials
designatfo

Human capital

Optics and color

Function

Accumulated technologies
and know-how

th e te c hn olo g y plIntellectual capital

Biomaterials
design

Mak
e st
rat
eg
ic
inv
es

ts
en
tm

Manufacturing capital
Facilities and equipment
essential to the provisionof products and servicestobus
re r nﬁgurationooa m ent c
ish gem
l
ab a
st an
m
al

gl
ob E

Funds essential tothe provision of products
and services

ance

Value Creation Cornerstones

Health-related
issuesResource
depletion

Environmental
issuesEnh

Value Creation Strategies

Value Creation Essentials

Build a business portfolio thathelps achieve sustainable
prosperity for society

inf
or

c

Data

em

Natural capital
Carbon neutrality andconsideration for biodiversityan* Materials informatics

ag

em

ent

of h

um an

c a p it a l

Pr o mot eMarshal individual
strengths to createorganizational dynamism

Social capital
Cooperation with stakeholders
and local communities

Materiality(For more information, please see page 53.)

Reinforce ESG initiatives
The DIC Way
5̲ DIC Report 2022

IT

d
an

D

X

A society that isincreasingly green,
digital and QOL-oriented

With the aim of ensuring a sustainable society, the DIC Group strives to provide products andsolutions that respond to the needs of markets and its customers and add color and comfort to life.

Sustainable energy

SDGs

Value Creation Essentials‫ٴ‬Specialty materials that contribute to the realization of
the high-performance secondary batteries and fuel cells
crucial to an electrified/hydrogen-powered societye.g. ・Materials for secondary batteries and fuel cells
・Functional organic fillers

Healthcare‫ٴ‬High-performance nutritional supplements that support the health of people of all ages

Value Creation Strategies‫ٴ‬Healthcare-related products and services that deliver safety,
peace of mind and comfort, contributing to a future in whichpeople enjoy an improved quality of life (QOL)
・High-performance nutritional productse.g.
・Natural skincare materials

Smart living

Value Creation Cornerstones‫ ٴ‬High-performance materials and solutions that contribute to the realization ofa sustainable society that coexists with a healthy global environment‫ ٴ‬Chemical solutions for modern lives that have evolved andimproved thanks to digitalization

・Materials for 5G/6G-enabled devices

e.g. ・Resins for next-generation semiconductors

・Bonding solutions for heterogeneous materials

Color science

Data‫ ٴ‬Color that is sustainable and ecologically sound‫ٴ‬Products with outstanding decorative properties that facilitate
the creation of comfortable spaces‫ ٴ‬Functional materials that leverage dyeing technologies todeliver convenience, satisfaction, safety and peace of mind
・Functional pigments (for light detection and ranging (LiDAR)
signal coatings, heat-blocking coatings)
e.g.
・Biomass pigments
・Natural colorants for cosmetics

Sustainable packaging‫ٴ‬Materials that ensure tastier, more enjoyable and safer merchandise reaches consumers‫ٴ‬Materials that deliver safety, peace of mind and convenience, as well as help reduce food loss
‫ٴ‬Product design that contributes to a circular economy, i.e., is conducive
to recycling and uses plant-derived and renewable raw materials

・Materials with outstanding barrier properties

e.g. ・Biomass packaging

・Recycling systems (chemical recycling, materials recycling)

SDGs Goals
2, 3, 6, 7, 9, 11,
12, 13, 14 and 15

DIC Report 2022 ̲6

Fiscal Year 2021 DIC Group Topics

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

Strategic Investments Under the DIC111 Medium-Term Management Plan
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1. Acquisition of the Colors & Effects Business from BASF
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Completion of Acquisition: June 30, 2021
・Purchase price (unadjusted): €1,010 million (approx. ¥128.9 billion) (Exchange rate used for calculation: €1.00 = ¥127.58)(Post-closing adjustments are pending. Accordingly, the actual final price may differ from this amount.)
・Method used to procure funds for acquisition: Bank loans(Thanks to the procurement of ¥60 billion through a subordinated term loan, DIC expects to maintain its debt-to-capital (D/C) ratio at 50% in fiscal year 2021.)
・The acquisition will cement DIC’s position as a leader in the global pigments industry.
・By expanding DIC’s portfolio of high-value-added products and optimizing its operations, this acquisition will accelerate Value Transformation.

Overview of the Colors & Effects Business・One of the world’s premier manufacturers of high-performance pigments, effect pigments(pearlescent pigments for cosmetics) and specialty organic pigments
・Number of employees: Approx. 2,600
・Production sites: 11
・R&D laboratories: 4
・Operations are centered in Europe; the Colors & Effects business supplies more than 5,000 companies
in 120-plus countries and territories worldwide

Asia
Europe

27%

52%
The Americas

21%
Geographical Breakdown of the Colors & Effects
Business’ Sales (Based on Results for 2020)%DVHGLQ(XURSHDQGZLWKVLWHVDURXQGWKHZRUOG&RORUV (IIHFWVQRZDPHPEHURIWKH',&*URXSKDVHVWDEOLVKHGLWVHOIDVDSURPLQHQWJOREDOPDQXIDFWXUHURIKLJKSHUIRUPDQFHSLJPHQWVHIIHFWSLJPHQWV SHDUOHVFHQWSLJPHQWVIRUFRVPHWLFV DQGVSHFLDOW\RUJDQLFSLJPHQWV7KHEXVLQHVVSRUWIROLRV²LQFOXGLQJWKHWHFKQRORJLHVSURGXFWVSURGXFWLRQIDFLOLWLHVVXSSO\FKDLQVDQGFXVWRPHUVHUYLFHFDSDELOLWLHV²RI&RORUV (IIHFWVDQGWKH*URXSKDUPRQL]HZHOOZLWKHDFKRWKHUZLWKOLWWOHRYHUODS
Addition of High-Value-Added Products Expected to Boost Profitability

Data

・In the area of functional pigments, the addition of effect pigments (pearlescent pigments for cosmetics) will significantly expand the DIC Group’s portfolio of
pigments for cosmetics and specialty applications such as agriculture, which are major growth drivers.
Functional Pigments

Increase in Net Sales Attributable to Acquisition
BeforeAfter

1.4 times

Specialty applications

2.2 times

Cosmetics

Cosmetics

Specialty applications(agriculture, etc.)

Construction materials(autoclaved aerated concrete)

Displays

Jet inks and toners

・In the area of general-purpose pigments, sales for use in industrial, construction-use and automotive coatings are increasing. The acquisition of the Colors & Effects business will
particularly expand the Group’s presence in the market for pigments for automotive coatings by broadening its product portfolio and improving its product development capabilities.
Increase in Net Sales Attributable to Acquisition
BeforeAfter
At least

General-Purpose Pigments

3.8 times

Coatings

Automotive coatings

7̲ DIC Report 2022

Industrial coatings

Construction-use
coatings

Plastics

Printing inks

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*URXS¶VSRVLWLRQDVDOHDGLQJJOREDOSLJPHQWVPDQXIDFWXUHUDifferences in Scale and Profitability by Application
Profitability

Product development that leverages
materials offered by the Colors &Effects business

LiDAR-compatible pigments forautonomous driving vehicles

Displays

Cosmetics

Specialty
applications

Improvement of business efficiency thanks toan expanded scale

Plastics

Coatings

Digital applications

9DOXH&UHDWLRQ(VVHQWLDOVDevelopment of products that leveragetechnological synergies

Pigments for heat-management
applications

Expansion of product groups
and applications,Q0DUFK',&HQWHUHGLQWRDFDSLWDODQGEXVLQHVVDOOLDQFHZLWK*UHHQ6FLHQFH0DWHULDOV,QF *60 DJUHHQELRWHFKVWDUWXSEDVHGLQ.XPDPRWR-DSDQWKDWKDVVXFFHHGHGLQFRPPHUFLDOL]LQJSACRANDSRO\VDFFKDULGHH[WUDFWHGIURP6XL]HQMLQRULDQLQGLJHQRXVEOXHJUHHQDOJDH$ELRWHFKVWDUWXSODXQFKHGE\WKH-DSDQ$GYDQFHG,QVWLWXWHRI6FLHQFHDQG7HFKQRORJ\ -$,67 *60FDSLWDOL]HVRQWKHUHVHDUFKDFKLHYHPHQWV
in the extraction of SACRANRI-$,67UHVHDUFKHUVQRWDEO\'U0DLNR2NDMLPDDQG3URIHVVRU7DWVXR.DQHNREHFRPLQJWKH¿UVWFRPSDQ\LQWKH
ZRUOGWRVXFFHVVIXOO\FRPPHUFLDOL]HSACRAN$PDFURPROHFXODUSRO\VDFFKDULGHH[WUDFWHGIURP6XL]HQMLQRULSACRAN™ boasts outstanding
PRLVWXUHUHWHQWLRQFDSDFLW\DQWLLQÀDPPDWRU\SURSHUWLHVDQGVNLQEDUULHUIXQFWLRQVERGLQJZHOOIRULWVXVHLQDZLGHUDQJHRIVNLQFDUHSURGXFWV
*60LVFXUUHQWO\ZRUNLQJWRGHYHORSDUWL¿FLDOFXOWXUHDQGFXOWLYDWLRQWHFKQRORJLHVIRU6XL]HQMLQRULZLWKWKHDLPRIIDFLOLWDWLQJWKHHI¿FLHQWPDVV
production and global sales of SACRAN7KHFRPSDQ\LVDOVRDFWLYHO\HQJDJHGLQ
FRQVHUYDWLRQHIIRUWVLQDQGDURXQGWKH.RJDQH5LYHULQ$VDNXUD)XNXRND3UHIHFWXUHWKHRQO\SODFHZKHUHWKLVDOJDHJURZVQDWXUDOO\The alliance with GSM will enable DIC to share mass cultivation and functional ingredientextraction technologies accumulated in the production of edible blue-green algae Spirulina
ZLWKWKHJRDORIKHOSLQJHVWDEOLVKWHFKQRORJLHVIRUWKHDUWL¿FLDOFXOWLYDWLRQRI6XL]HQMLQRUL
,QDGGLWLRQ*60ZLOOZRUNZLWK',&*URXSFRPSDQ\6XQ&KHPLFDO&RUSRUDWLRQZKLFKRYHUVHHV*URXSRSHUDWLRQVLQWKH$PHULFDVDQG(XURSHWRH[SDQGVDOHVRI6XL]HQMLQRULDQG
SACRANZRUOGZLGHDVZHOODVWRSURPRWHWKHGHYHORSPHQWRIQHZDSSOLFDWLRQVIRUERWK

3. Investment in Vaxa Technologies,Q$SULO',&FRPSOHWHGLQYHVWPHQWLQ9D[D7HFKQRORJLHV/WGDELRWHFKVWDUWXS
KHDGTXDUWHUHGLQ,VUDHODVSDUWRIDVWUDWHJLFH[SDQVLRQRI',&¶VKHDOWKIRRGDQGRWKHUDOJDHGHULYHGSURGXFWVEXVLQHVVHV9D[D7HFKQRORJLHVSRVVHVVHVXQLTXHSURSULHWDU\OLJKWHPLWWLQJGLRGH /(' ±LOOXPLQDWHG
photobioreactors and algae cultivation technologies and is engaged in the development and
FRPPHUFLDOL]DWLRQRISURSULHWDU\FOHDQKLJKYDOXHDGGHGDOJDHSURGXFWV9D[D7HFKQRORJLHV¶
FXOWLYDWLRQSURFHVVHPSOR\VUHQHZDEOHHQHUJ\DFKLHYLQJH[FHOOHQWSURGXFWLYLW\ZKLOHUHTXLULQJVLJQL¿FDQWO\OHVVODQGDQGIUHVKZDWHUWKDQFRQYHQWLRQDOFXOWLYDWLRQPHWKRGV7KLVSURFHVVDOVRFRQYHUWVGLVFKDUJHG&2LQWRXVHIXOPDWHULDOVPDNLQJWKHSURFHVVFDUERQQHJDWLYHDQGWKXVKLJKO\VXVWDLQDEOHDIC Report 2022 ̲8

Value Creation Cornerstones

2. Capital Alliance with GSM

DataBusiness scale.

Value Creation Strategies

Printing inks

Financial Information
Net Sales, Operating Income and Operating Margin
Net sales

Operating income

Net Cash Provided by Operating Activities and Free Cash Flow
(Billions of yen)

900
800

855.4
805.5

789.4

Value Creation Essentials
Value Creation Strategies

60

80

50

70

40

60

30

768.6

6.0%

7.2%

5.7%

5.4%

600

5.0%

500

50

400

40

300

30

200

20

56.5

48.4

41.3

39.7

42.9

54.2

0

2017

2018

50.6
44.8

25.8

20
10

21.4

12.6

0

-4.7

-5

2019

2020

2021

-102.8-105.0

0

(FY)

2017

2018

2019

2021

2020

(FY)

Notes:*1 Owing to an investment of ¥24.9 billion in TAIYO HOLDINGS CO., LTD., capital expenditure andLQYHVWPHQWLQFUHDVHGLQ¿VFDO\HDU
*2 7KHLQFUHDVHLQFDSLWDOH[SHQGLWXUHDQGLQYHVWPHQWLQ¿VFDO\HDUUHÀHFWVWKHLPSDFWRI',&¶Vacquisition of the Colors & Effects pigments business from BASF SE (acquisition cost: ¥128.9 billion).

Operating Income after Tax and ROIC*

Capital Expenditure and Investment(Billions of yen)

Operating income after tax (Billion of yen)

168.2

170

ROIC（%）

（%）
8

7.2%

160

7

6.0%

70

5.0%

60

4.8%

40.7

40

62.4

6

5.2%

50

5
50

34.8
29.8

30

30.9

28.6

40

3

20
10

1

0

0

2018

2019

2021 (FY)2020

Shareholders’ equity

37.1

2019

2020

20
10
0

2017

2018

2021

Returns to Shareholders* (Dividends per Share and Payout Ratio)
Net D/E ratio (Times)
1.0

Interim dividend

Payout ratio (%)

Year-end dividend（%）(Times)

400

225
220
215
210

216.8%

1.0(Billions of yen)

(FY)

Notes:
1. Owing to an investment of ¥24.9 billion in TAIYO HOLDINGS CO., LTD., capital expenditure andLQYHVWPHQWLQFUHDVHGLQ¿VFDO\HDU
2. 7KHLQFUHDVHLQFDSLWDOH[SHQGLWXUHDQGLQYHVWPHQWLQ¿VFDO\HDUUHÀHFWVWKHLPSDFWRI',&¶Vacquisition of the Colors & Effects pigments business from BASF SE (acquisition cost: ¥128.9 billion).

Shareholders’ Equity, Net Interest-Bearing Debt
and Net D/E Ratio*
Net interest-bearing debt

37.5

30

2

2017

45.1

4

* ROIC : Operating income x (1 - Effective tax rate of 28%) / (Net interest-bearing debt + Net assets)

Data

54.5

51.0

10

100

(Billions of yen)

Value Creation Cornerstones

Operating income(Billions of yen)

701.2

700

Net cash provided by operating activities
Free cash flow

Operating margin (%)

Net sales(Billions of yen)

0.9

0.8

0.8

0.8
0.7

0.8

346.0

0.7

300

71.5%

0.6

247.8

244.7

235.8

0.5

221.9

200

0.4

315.1

298.9

312.7

318.5

0.3

345.9

100

0.2

(Yen)

150

100

50

0.1
0

0

2017

2018

2019

2020

* Net D/E ratio:Net Interest-bearing debt / Shareholders' equity

9̲ DIC Report 2022

2021

(FY)

0

36.9%
29.4%
120

125

40.3%
100

100

100

60

65

40

50

50

60

60

60

50

50

2017

2018

2019

2020

2021

(FY)

75
70
65
60
55
50
45
40
35
30
25
20
15
10
5
0

1RQ¿QDQFLDO,QIRUPDWLRQ
Global CO2 Emissions and CO2 Emissions per
Unit of Production (DIC Group)
CO 2 emissions(Tonnes)Global Energy Consumption and Energy Consumption per
Unit of Production (DIC Group)

CO 2 emissions per unit of production

400

296

659,000

600,000

12,000

292

300

272

270

155

5.

5.142

11,379 11,053
10,902

5.108

5.014

5

4.732
10,717

10,379 10,474

10,000247

635,000 618,000

11,000(GJ/tonne)

6

5.360

13,000311

800,000

Energy consumption per unit of production(Thousands of GJ)

14,000900,000

4

9,000

577,000 552,000 546,000

500,000

200

8,000
3

7,000
6,000
5,000

2

4,000
3,000

200,000

1

2,000

100,000

Value Creation Essentials

100

1,000

0
2016

2017

2018

2019

2020

2021

(FY)

0

0

2016

2017

2018

2019

2020

2021 (FY)0* CO2 emissions per unit of production is calculated using adjusted production volume (parent
FRPSDQ\LQ-DSDQRQO\  1RWL¿FDWLRQVXEPLWWHGWR-DSDQ¶V0LQLVWU\RI(FRQRP\7UDGHDQG,QGXVWU\* Energy consumption per unit of production is calculated using adjusted production volume (parent
company in Japan only). 1RWL¿FDWLRQVXEPLWWHGWR-DSDQ¶V0LQLVWU\RI(FRQRP\7UDGHDQG,QGXVWU\

Number of Employees (DIC Corporation and the DIC Group)

Occupational Accident Frequency Rate (DIC Corporation)(Number of people)

DIC Group

DIC(Rate)

25,000DIC

1.50

Overall manufacturing industry in Japan

22,474
20,628

20,62020,513

20,24220,0001.00

15,0000.50

0.00

10,000

2013

3,503

3,538

3,593

3,681

3,662

Frequency rate ＝
0

2017

2018

2019

2020

2021

(FY)

Notes:
3HUFHQWDJH¿JXUHVLQSDUHQWKHVHVUHSUHVHQWWKHSURSRUWLRQRI',&*URXSHPSOR\HHVDFFRXQWHGIRUE\HPSOR\HHVRI',&&RUSRUDWLRQ(PSOR\HHVQXPEHUVIRU',&&RUSRUDWLRQDUHFDOFXODWHGEDVHGRQLQIRUPDWLRQLQWKH&RPSDQ\¶V$QQXDO6HFXULWLHV5HSRUWDQGWKXVGLIIHU
IURPWKRVHLQWKH+XPDQ5HVRXUFHV0DQDJHPHQWVHFWLRQRIWKLVUHSRUWAverage Years of Employment (DIC Corporation)(Years)

2016

2017

2018

2019

Female employees

Number of deaths or injuries due to occupational accidents
Total work hours

18.2 years Female employees: 20.2years Overall:18.6 years

25

× 1,000,000

Female Employees in Management Positions (DIC Corporation)
Female employees

Percentage of total (%)

70

Average years of employment in fiscal year 2021
Male employees:

2021 (FY)2020

A frequency rate of 1.00 means one occupational accident resulting in workdays lost in one year
at a site with 500 employees.

(Number of people)

Male employees

2015

Note: The frequency rate expresses the frequency of accidents resulting in workdays lost in a fiscal year,
calculated as the number of deaths or injuries per million work hours.

（17.0%） （17.2%） （17.5%） （18.1%） （16.4%）
5,000

2014

61

60

57
52
6.3%

48

50

（%）
7

6

5.9%
5.5%

41

20

40

30

10

5

5.1%

33
15

4

4.4%

3.7%

3

20
2

5

10

1

0
1994

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 (FY)

Value Creation Strategies

300,000

Value Creation Cornerstones

400,000

0

2017

2018

2019

2020

2021

2022 (FY)0

DIC Report 2022 ̲10

Data700,000

Energy consumption(Kg CO2 /tonne)

1,000,000

The DIC Group: A Global Powerhouse
Net Sales

Corporate Data

(Billions of yen)

1,000

Registered name:

Number of subsidiaries
and affiliates:(

189 Domestic: 29
Overseas: 160

855.4

701.2

768.6

400

805.5

600

’17

’18 ’19 ’20 ’21 （FY）

200
0

)

Operating Income(Billions of yen)60

Corporate headquarters (Tokyo)

50

Value Creation Cornerstones

DIC (China) Co., Ltd. (PRC)

42.9’17 ’18 ’19 ’20 ’21 （FY）

DIC has 189 companies in 63 countries and territories around the world.

Europe

63

29
Asia

Data

39.7

10
0

Global Network

41.3

20

48.4

30

56.5

40

Note: Corporate data is as of December 31,
2021. Net sales and operating income arefor fiscal year 2021. The nonconsolidated
number of employees refers to individuals
registered as employees of DIC
Corporation and thus differs from the figurein the Annual Securities Report.

Value Creation Strategies

Value Creation Essentials

Date of foundation:
Date of incorporation:
Paid-in capital:
Number of employees:

800

DIC Building, 7-20,
Nihonbashi 3-chome,
Chuo-ku, Tokyo 103-8233,
Japan
February 15, 1908
March 15, 1937
¥96.6 billion
20,474(Nonconsolidated: 3,345)

789.4

Corporate headquarters:

63

Japan

Europe and Africa

Japan

Sun Chemical Groupand others

Net sales
DIC Asia Pacific Pte Ltd (Singapore)¥219.9 billion

Operating income

DIC Corporation, DIC Graphics
Corporation and others

3¥5.0 billion

AfricaNet sales

Asia and Oceania(Excluding Japan)

DIC (China) Co., Ltd., DIC Asia
Pacific Pte Ltd and others

Net sales¥181.6 billion

Operating income
Sun Chemical Corporation headquarters(United States)

11̲ DIC Report 2022

2

¥15.5 billion

Oceania¥308.3 billion

Operating income¥27.9 billion

Breakdown of Fiscal Year 2021 Net Sales by Segment

Breakdown of Fiscal Year 2021 Operating Income by Segment

Functional
Products

Functional
Products

31.8%￥855.4billion

50.6%

Packaging &Graphic

￥42.9

41.8%

billion

49.4%

Color &
Display

Packaging &Graphic

Color &
Display

18.8%

7.6%
Breakdown of Fiscal Year 2021 Operating Income by Region

Breakdown of Fiscal Year 2021 Net Sales by Region
Asia and Oceania

Asia and Oceania

21.2%
17.0%

29.4%

￥855.4billionJapan

North, Central andSouth America

36.0%

￥42.9
billion

8.0%

Europe and Africa

Europe and Africa

25.7%

9.6%

Japan

53.0%
Value Creation Strategies

North, Central andSouth America

Value Creation Essentials

Note: Fiscal year 2021 net sales and operating income as used here include intersegment transactions. For this reason, and because of the existence of transactions classified as “others,” which are not attributable to reportable segments, these figuresdiffer from reported net sales and operating income.

Note: Operating income as used here includes eliminations (approximately ¥7.9 billion). Accordingly, these percentages do not represent shares of reported operating income.

North
America

15

Polymer
Technical Center —China

Rochdale(United Kingdom)North, Central andSouth America
Sun Chemical Group and others

Net sales

Printing Inks
Technical Center —China

Qingdao DIC
Finechemicals (PRC)

Cincinnati(United States)

St. Charles(United States)
Midsomer Norton(United Kingdom)

Gallarta (Spain)

Ludwigshafen
am Rhein(Germany)Fine Chemical
Technical Center—Korea

Besigsheim(Germany)

Tarrytown(United States)

Data¥145.5 billion

Peekskill(United States)

Operating income¥4.2 billion

Eurolab (Germany)

Central ResearchLaboratories (Japan)
Solid Compound
Technical Center —Asia Pacific (Malaysia)

14
Central & SouthAmerica

Value Creation Cornerstones

Principal Global R&D Sites

Pigment TechnicalCenter—Asia Pacific(Indonesia)
Polymer Technical Center —Asia Pacific (Thailand)

Printing Inks
Technical Center —Asia Pacific (Thailand)

DIC/Earthrise Algae
Research Center(United States)

Carlstadt(United States)

DIC Report 2022 ̲12

TOP MESSAGE

Kaoru Ino

Becoming a unique andtrusted global company
ideally positioned to deliver
sustainable prosperity
for the global economy

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

President & CEO
DIC Corporation

13̲ DIC Report 2022

:H·YHHYROYHGRXU&RORU &RPIRUWYDOXHSURSRVLWLRQ
7RVHFXUHDEULJKWHUIXWXUHIRUWKHSODQHWDQGKXPDQLW\
5HÁHFWLQJRQWKH',&0HGLXP7HUP0DQDJHPHQW3ODQ

In a major achievement, we instantly established a leading position in organic and inorganic pigments globally by acquiring
Germany-based BASF’s Colors & Effects pigment business (hereinafter, “C&E pigment business”). We’re also keeping pacewith rapidly accelerating digitalization. Moreover, we managed to capture 5G-related demand by developing low-dielectricmaterials that enable high-speed communications.
In addition to added economic value, we accelerated the shift of our printing ink business to high social value packaging inks,
contributing to greater sustainability amid the growing attention on the climate crisis and circularity. We continue to steadily
advance Value Transformation among our existing businesses, with packaging ink already contributing some 80% of printing ink
sales. Among our new businesses, we are announcing new products in each of the four priority areas (electronics, automotive,
next-generation packaging, and healthcare), and we can already see a clear path toward our goal of New Pillar Creation.
While we’ve delivered a level of results under our basic strategy, to make up for any gaps in sales or profit plans, we must
continue to tackle challenges in four remaining areas: 1) Further clarify our business portfolio, while achieving sustainablegrowth via portfolio transformation; 2) Develop synergies in the early stage of acquisitions, including the growth-driving C&E
pigment business acquisition, to further improve our performance; 3) Establish new businesses as new business pillars bypromoting more key investments and acquisitions; 4) And finally, promote further structural reforms for greater efficiency andbusiness conversion in the shrinking publishing and newspaper ink business, as well as the struggling TFT LCD business—
which is now experiencing intense competition.

Value Creation Strategies

Amid growing US-China trade friction, the COVID-19 pandemic, and a series of supply chain disruptions, we experienced
sluggish sales and fell significantly short of achieving our plan. However, despite major global trade disruptions, the DIC
Group steadily promoted our two basic strategies and achieved measurable gains.

Value Creation Cornerstones

Between fiscal 2019 and 2021, the DIC Group promoted our DIC111 Medium-Term Management Plan. Based on thefundamental concept of becoming “a unique and trusted global company” by consistently generating value by safely providing
Color and Comfort, we strove to strengthen our business structure through qualitative transformation. Under the two basic
strategies of Business Transformation and New Pillar Creation, we created new businesses that respond to social issues andchange, recording high sales of 950 billion yen and operating income of 70 billion yen in fiscal year 2021.

Value Creation Essentials■ 6HHNLQJ6XVWDLQDEOH*URZWK%\6WUHQJWKHQLQJ3URÀWDEOH%XVLQHVVHV$QG%XLOGLQJ2Q6XFFHVV/RQJ7HUP0DQDJHPHQW3ODQ',&9LVLRQ ²Data■ 2XU5HYLVHG9LVLRQ(QKDQFLQJ&RUSRUDWH9DOXHE\0D[LPL]LQJ2XU6RFLDO6LJQLÀFDQFH
The global climate crisis has clarified our social goals for the next ten years. Given the introduction of the 2030 Sustainable
Development Goals (SDGs) and from the perspective of achieving carbon neutrality by 2050, the world has made great
strides toward devising a global solution towards achieving sustainability.
Moreover, COVID-19 has drastically changed people's behavioral patterns: People are now proactive about the so-called“new normal”—what we recognize as the transition to a digital society, including remote work and digital marketing. Unless
we take appropriate measures, a failure to adapt to this new normal will affect our corporate competitiveness. In the face ofsuch dramatic social change and paradigm shifts, our typical three-year management plan inevitably felt short-sighted. Thus,
I made the decision to shift to a long-term management plan.
What is the proper long-term perspective for a large company like ours? We considered what maximizes our social
significance beyond merely maximizing profits. We based our evaluation on the recognition that taking a long-term
perspective and improving corporate value favors overall shareholder interests. In other words, we see social interests as
inclusive of shareholder interests.

DIC Report 2022 ̲14

Moving forward, we shall find our purpose in leveraging our company’s unique attributes (the reason for our existence)
to maximize our social significance, and continuously promote “purpose-driven management” by recognizing this as our
mission, sharing our purpose with all of our many stakeholders, beginning with our employees. Here, we have revised our
Vision Statement.
Based on our evolved Color and Comfort valued proposition, we’ve revised Vision Statement as follows:

Value Creation Strategies

Value Creation Essentials

We improve the human condition by safely deliveringcolor and comfort for sustainable prosperity—Color & Comfort
We’ve evolved our Color and Comfort value proposition to provide a wide range of value beyond chemistry, securing abrighter future for the planet and humanity. Here, we devised the long-term management plan DIC Vision 2030 with a basic
policy of “pursuing social benefits that include shareholder interests, striving to enhance long-term corporate, leveraging our
evolved Color & Comfort value proposition.”■ 7KH',&*URXSLQ
DIC Vison 2030 sets our sights on building a business portfolio that “contributes to sustainable prosperity” while “contributing
to the realization of sustainability for the global environment and for society.” Moreover, “to increase the sales ratio ofsustainable products from the current 40% to 60% by 2030” and “to achieve carbon neutrality by 2050 (DIC NET ZERO2050),” we’ve set a goal to “reduce annual CO 2 emissions by 50% of 2013 levels by 2030” (See Diagram 1).

1

Build a business portfolio that contributes tosustainable prosperity for society

Help achieve sustainability for the global
environment and for society

2

Value Creation Cornerstones‫ ٴ‬Promote business portfolio transformation by expanding
businesses in growth markets and creating new businesses
to build a business portfolio that does not depend on ink‫ ٴ‬Expand selection of sustainable products with the aim of‫ ٴ‬Advance sustainability strategies

to help realize a carbon-neutral society

contributing to a society that is increasingly green, digital andemphasizes QOL and of enhancing corporate value

TargetIncrease sustainable products as a percentageof net sales to 60% by FY2030‫ق‬FY2020: 40%‫ك‬

TargetReduce annual CO2 emissions by 50% by FY2030

Contribute to a society that is increasinglyGreenz Achieve carbon neutralityz Realize a circular economy

Digitalz Propel the evolution of informationand communicationsz Drive the evolution of CASE and
MaaS

Data

z Promote the development of AI andthe IOT technologies

QOL
z Deliver safety, peace ofmind and conveniencez Prolong healthy life
expectancyz Embrace diverse values

The DIC Group aims to achieve carbon neutrality—
net zero CO2 emissions—by FY2050 and will seek
to reduce CO2 emissions by 50% from the FY2013
level by FY2030.

Diagram 1: DIC Vision 2030 Targets

Addressing our business portfolio, we’ll seek to avoid an overreliance on our traditional ink products, building a diversified
business portfolio by more actively allocating management resources to our five newly established priority business areas tofurther increase social value. Moreover, to enhance our corporate value through the delivery of more sustainable products,
we’ve identified three key areas in which we are uniquely positioned to contribute to society: Green, Digital, and Quality ofLife (QOL).
We created two phases. Phase One, the first four years through 2025, will be a foundation building period, in which
management will emphasize investment efficiency and earning power using Return on Invested Capital (ROIC) management.
Here, we’ll promote business the portfolio transformation we’ve been promoting since the previous management plan. Phase
Two, the next five years through 2030, will be a period of realizing and developing our goals to expand sustainable productsthat contribute to solving social issues (See Diagram 2).

15̲ DIC Report 2022‫ ٴ‬Increase weighting of sustainable products*,
which help address social imperatives anddeliver both social value and economic value(FY2026–2030)

Realization of
DIC Vision 2030

‫ ٴ‬Adopt return on invested capital (ROIC)**
as a metric and seek to improve investment
efficiency(FY2022–2025)* For more information on sustainable products.
** ROIC: Net operating income after tax / (Net Interest-bearing debt + Net assets)

FY2030Foundation building

Sustainable products asa percentage of net sales

60%
FY2025

Sustainable products asa percentage of net sales¥855 billion¥43 billion
Operating income:Net sales:

5.0 ٫
4.8 ٫

Operating margin:
ROIC:

Sustainable products asa percentage of net sales

40%‫ق‬FY2020‫ك‬Net sales:¥1,300+ billion

Operating income:¥120+ billion

9.2+ ٫
8.0+ ٫

Operating margin:¥1,100 billion
Operating income:¥80 billion
Net sales:

Operating margin:
ROIC:

ROIC:

7.3 ٫
6.0 ٫

Diagram 2: Numerical Plan

■ %DVLF6WUDWHJ\IRU$FKLHYLQJ2XU7DUJHWVValue Creation Essentials

50%

FY2021%\FRQFHQWUDWLQJPDQDJHPHQWUHVRXUFHVLQWKHVH¿YHDUHDVZH¶OOSURPRWHWKHHI¿FLHQF\RIRXUHIIRUWVWRZDUG9DOXH7UDQVIRUPDWLRQ
and New Pillar Creation. Notably, in Sustainable Energy and Healthcare, we’ll leverage DIC Group strengths to deliver products
such as next-generation high-capacity and long-life secondary battery materials, and high-performance nutrition based on naturally
derived materials. We’ll invest in these businesses and grow them into new pillar businesses in high-growth markets.
In Smart Living, Color Science, and Sustainable Packaging, we’ll continue expanding our business and maximizing synergies throughM&A. In this plan, we’ve positioned already mature markets like Publishing Inks and TFT LCDs for structural reform projects, and we plan
to continue optimizing business operations through right sizing while closely monitoring market conditions (See Diagram 3).
‫؞‬Step up intensive investment
in New Pillar Creation‫؞‬Demonstrate strengths
in highly promising markets

SustainableenergyBusinesses withstable earnings
bases‫؞‬Shift to growth areas by capitalizing
on existing business infrastructure‫؞‬Reinforce earnings bases
by transforming business models

ColorscienceBusinesses in needof structural reform‫؞‬Maximize profitability by improving efficiency

Healthcare
SmartlivingSustainable
packaging

Data

Next-generation/
growth businesses

Value Creation Cornerstones:H¶YHHVWDEOLVKHG¿YHSULRULW\EXVLQHVVDUHDVIRUSURPRWLQJEXVLQHVVSRUWIROLRWUDQVIRUPDWLRQPD[LPL]LQJRXULPSDFWVRQPDUNHWJURZWKand society: Sustainable Energy, Healthcare, Smart Living, Color Science, and Sustainable Packaging. We’ve determined that these are
WKH¿YHEXVLQHVVDUHDVRIIHULQJXVWKHJUHDWHVWRSSRUWXQLWLHVWRFRQWULEXWHWRVRFLDOLVVXHVDQGGHPDQGOHYHUDJLQJ',&*URXSVWUHQJWKV

Value Creation Strategies

Business Portfolio Transformation: Our Five Priority Business Areas

Publication inks

TFT LCs

Diagram 3: Five Priority Business Areas

Business Portfolio Transformation: Five Measures Supporting Transformation,QDGGLWLRQWRFRQFHQWUDWLQJPDQDJHPHQWUHVRXUFHVRQ¿YHSULRULW\EXVLQHVVDUHDVZH¶YHDOVRGHYHORSHG¿YHYLWDOPHDVXUHVVXSSRUWLQJ
business portfolio transformation (See Diagram 4).
Enhance the technology platform

Make strategic investments

Reinforce management of human capital

Shift to R&D that leverages computational science
Establish new basic technologies

Invest strategically, including in M&As, to transform thebusiness portfolio
Build a new business portfolio that takes ROIC into account

Build a strategic human resources portfolio thatmaximizes the value of human capital

Establish a more global management configuration

Promote IT and DX

Adopt a sophisticated global management modeland accelerate global expansion in five priority
business areas

Use digital technologies to provide new
added value and revamp the Group’sbusiness structure

Diagram 4: Five Measures

DIC Report 2022 ̲16

Value Creation Essentials
Value Creation Strategies$PRQJWKH¿YHPHDVXUHVVWUHQJWKHQLQJKXPDQFDSLWDOPDQDJHPHQWLVRQHRIRXUPRVWYLWDOVWUDWHJLHV:HQHHGDOO',&*URXSPHPEHUVto share our “corporate purpose” to truly become a Group pursuing social value. To that end, we must invest in a global HR system thatKHOSVRXUPHPEHUVPD[LPL]HWKHLUYDOXH$VRIDOO',&*URXSPHPEHUV DVRI'HFHPEHU DUHHPSOR\HGE\DI¿OLDWHVEDVHG
outside Japan, the DIC Group is truly a global organization. And as our diversity is a major source of our competitiveness, we must
continue to promote human resource development, actively acquiring talent from external sources while increasing meaningful roles
throughout the Group, regardless of a member’s nationality or gender. Moreover, with an eye toward a post-COVID-19 world, we must also
improve member motivation, promote workplace reforms through digitalization, and enhance productivity through process reforms. Moving
forward, we must focus on promoting internal communications, both within and outside Japan, fostering a sense of unity through empathy
and trust, and promoting the challenges needed for fostering innovation (See Diagram 5).

Value Creation Cornerstones

Three strategic priorities
Foster human resourcesz Global-based talent management and leadershiptrainingz Promote reskilling to maximize human resources

Ensure mobility (hiring, retention and succession)z Actively recruit people from different industries andpeople with digital capabilities
z Achieve optimal balance between specialists andgeneralistsz Succession planning

Improve engagement and organizational cohesivenessz Promote communication and use empathy and trust to
cultivate solidarity
z Advance innovation by encouraging enthusiasm about
taking on challenges

Personnel management platform
Framework creation: Global HR system

Risk management: Safety and compliance‫ ٴ‬Facilitate autonomous, multitrack career building‫ ٴ‬Ensure occupational health and safety, and appropriate labor practices‫ ٴ‬Adopt global HR system to create standardized Group framework‫ ٴ‬Improve compliance and reinforce HR governance

Enhance corporate culture: Value diversity and inclusion‫ ٴ‬Promote diversity, recognizing it as a source of competitiveness‫ ٴ‬Nurture inclusion, recognizing it as essential to making diversity a competitive advantage

Work style reform: Bolster job satisfaction and productivity‫ ٴ‬Implement reforms designed to increase job satisfaction, as well as workplace reforms and process reforms that reinforce productivity

Data

Diagram 5: Reinforcing Human Capital Management

DIC Corporation is currently developing Work Style Revolution 2020 (WSR2020) promoting work style reform through a committeethat I’m chairing myself. This initiative seeks to promote “behavioral changes” by reviewing and radically changing the work styleof every member. We believe that senior management must work together with members at all levels to effectively transform ourorganization together, creating an ideal environment where all members can work effectively, with a sense of challenge, supporting
mutual growth, unbound by archaic customs or implicit rules. We seek to transform our culture to create an environment where all
can interact freely and say, “I'm glad I joined DIC.”
We’ll conduct internal research to measure how member awareness and behavior changes, and determine necessary course
FRUUHFWLRQVZKLOHPDLQWDLQLQJRSHQGLDORJVZLWKPHPEHUVIRUÀH[LEOHUHVSRQVHV8VLQJWKHRSSRUWXQLW\FUHDWHGE\WKH& (SLJPHQW
business acquisition, we’re strengthening our global management structure by promoting the global exchange of human resources
and information sharing. For example, we made the President of Sun Chemical Corporation—our controlling entity in Europe and
WKH86²DQ([HFXWLYH2I¿FHUDW',&&RUSRUDWLRQ²RXUJOREDOKHDGTXDUWHUV²VRZHFDQEHLQYROYHGLQUHIRUPVLQ(XURSHWKH86
and throughout the entire Group. Moving forward, we’ll continue increasing opportunities for Japanese and non-Japanese members
to work together on the same tracks in various departments within DIC Corporation.

17̲ DIC Report 2022

Beside strategic investments, we’ve planned total 2025
investments of 70 billion yen, including green electricity to
reduce CO 2 emissions, technology platform expansions,and promoting IT digitalization. For our technology
platforms, we’ll shift to research and development utilizing
AI and materials informatics* while expanding design
technology for inorganic materials and biomaterials acquired in the C&E pigment business acquisition and joint developmentswith venture capital firms. We’ll also strengthen and accelerate our development of new technologies and new products.

Value Creation Essentials

For strategic investments, we have established a 2025
strategic investment quota of 230 billion yen to grow thecompany, transform our business portfolio, and launch
new businesses. This investment quota encompasses
M&A funds for acquiring new technologies andoperations, as well as capital investments for launching
new products. For example, we’ll make a wide range ofinvestments in Sustainable Energy—which we’ll seek tocultivate as a new business pillar—and the five priority
business areas, particularly Smart Living. We’ll promptly
respond to changes in the environment and determine
investment targets.

Our sustainability strategy seeks to demonstrate DIC’s strengths in the three key areas in which we are uniquely positioned
to contribute to society—Green, Digital, and QOL—defining “sustainable products” using our own proprietary sustainability
index that balances social contributions and environmental burden reductions as coordinates, as we seek to increase ourcurrent sales ratio of sustainable products from 40% to 60% by 2030. By providing new products, such as inks and pigments
using biomaterials as raw materials, low-dielectric materials compatible with high-capacity, high-speed communications, suchas 5G and 6G, and natural materials that support safe, secure, and convenient living, we believe we can provide a wide rangeof value beyond traditional chemistry.
Moreover, the DIC Group has been promoting DIC NET ZERO 2050 since 2021. Through Scope 1 and Scope 2 activities,
such as promoting the green electrification of production equipment, we aim to reduce annual CO 2 emissions by 50% of 2013
levels by 2030. Furthermore, by further reducing carbon contributions throughout the value chain, including Scope 3—forexample, by promoting recycling and biomaterials use—we aim to achieve carbon neutrality by 2050.

Value Creation Cornerstones

Our Sustainability Strategy

Value Creation Strategies

0DWHULDOV,QIRUPDWLFV(IIRUWVWRLPSURYHWHFKQRORJLFDOGHYHORSPHQWHI¿FLHQF\XVLQJLQIRUPDWLFV LQIRUPDWLRQVFLHQFH DQGPHWKRGVWKDWXWLOL]HVWDWLVWLFDODQDO\VLVHWF

The DIC Group’s acquisition of the C&E pigment business in 2021 has attracted more diverse human resources,
strengthening our global network. We anticipate a significant increase in sales in 2022 as we resolve logistics issues
that emerged upon closing the acquisition, expanding business activities with an eye toward the post-COVID-19 world.
Conversely, earnings remain uncertain due to the fluid situation amid ongoing geopolitical unrest and the accompanying risein energy prices.
Given current circumstances, to realize our revised Vision and long-term management plan DIC Vision 2030, we must
share our “corporate purpose” with stakeholders, promoting it among all DIC Group members. It is especially vital that we
all internalize this approach on a personal level. Since announcing DIC Vision 2030, senior management, including yours
truly, has commenced visits to our domestic facilities to discuss our renewed purpose and its significance, enhancing
understanding among all members. Moving forward, as conditions allow, I also hope to visit sites outside Japan as well.
Senior management must create a common understanding through direct dialogue with all members, engaging in frank
discussions to realize our plans.
The DIC Group shall strive to maximize Group profits as well as our social significance, to secure a brighter future for theplanet and humanity as expressed in our revised Vision. Recognizing the preciousness of peace, and how the DIC Group cancontribute to world, we must work with stakeholders to deliver sustainable prosperity and promote DIC’s development as “aunique and trusted global company.”

DIC Report 2022 ̲18

Data

Promoting Sustainable Prosperity

DIC Vision 2030 Long-Term Management Plan',&KDVDQQRXQFHGDGH¿QHGYLVLRQVWDWHPHQW³:HLPSURYHWKHKXPDQFRQGLWLRQE\VDIHO\GHOLYHULQJFRORUDQGFRPIRUWIRUVXVWDLQDEOH
SURVSHULW\²&RORU &RPIRUW´DQGDQHZO\IRUPXODWHGORQJWHUPPDQDJHPHQWSODQ',&9LVLRQWRJXLGHLWWKURXJK¿VFDO\HDU

Basic Policy
Safely delivering Color & Comfort for sustainable prosperity
to enhance shareholder value and long-term corporate value
Value Creation Essentials—Establishing a business portfolio beyond ink products and implementing carbon neutrality initiatives—

DIC in the Future1

Build a business portfolio that contributes tosustainable prosperity for society

Help achieve sustainability for the global
environment and for society

2

Value Creation Strategies‫ ٴ‬Promote business portfolio transformation by expanding
businesses in growth markets and creating new businesses
to build a business portfolio that does not depend on ink‫ ٴ‬Advance sustainability strategies‫ ٴ‬Expand selection of sustainable products with the aim ofto help realize a carbon-neutral society

contributing to a society that is increasingly green, digital andemphasizes QOL and of enhancing corporate value

TargetIncrease sustainable products as a percentageof net sales to 60% by FY2030‫ق‬FY2020: 40%‫ك‬

TargetReduce annual CO2 emissions by 50% by FY2030

Value Creation Cornerstones

Contribute to a society that is increasingly
Green

DigitalQOL

z Propel the evolution of informationand communicationsz Drive the evolution of CASE andMaaSz Achieve carbon neutralityz Realize a circular economy

z Promote the development of AI andthe IOT technologies

The DIC Group aims to achieve carbon neutrality—
net zero CO2 emissions—by FY2050 and will seek
to reduce CO2 emissions by 50% from the FY2013
level by FY2030.

z Deliver safety, peace ofmind and conveniencez Prolong healthy life
expectancyz Embrace diverse values

Basic Strategies
Business Portfolio Transformation

Data

Designate and focus the allocation of management resources in five priority business areas that contribute to an increasingly green, digital and QOL-oriented society

Five priority
business areas
Smart living

Value Transformation

SustainableenergyStrengthen corporate structure throughqualitative reforms of businesses

Healthcare

New Pillar Creation

Sustainable
packaging

Color science–

Create new businesses in response to
ESH-related issues and social changes

Enhance the technology platform

Make strategic investments

Reinforce management of human capital

Shift to R&D that leverages computational science
Establish new basic technologies

Invest strategically, including in M&As, to transform thebusiness portfolio
Build a new business portfolio that takes ROIC into account

Build a strategic human resources portfolio thatmaximizes the value of human capital

Establish a more global management configuration

Promote IT and DX

Adopt a sophisticated global management modeland accelerate global expansion in five priority
business areas

Use digital technologies to provide new
added value and revamp the Group’sbusiness structure

Sustainability Strategies
Expand sustainable products

Reduce CO2 emissions

Respond to a circular economy

Work to expand sustainable products, that is,
products that demonstrate unique competitive
strengths and respond to ESH-related issues

Promote efforts to reduce CO2 emissions andhelp realize a carbon-neutral society

Advance efforts to respond to a circular economy,
thereby contributing to a sustainable society

19̲ DIC Report 2022

1

Business Portfolio Transformation● ,GHQWLI\DQGFRQFHQWUDWHDOORFDWLRQRIPDQDJHPHQWUHVRXUFHVLQ¿YHSULRULW\EXVLQHVVDUHDVLQZKLFK',&FDQPDNHLPSRUWDQWFRQWULEXWLRQVWRD

VRFLHW\WKDWLVLQFUHDVLQJO\JUHHQGLJLWDODQG42/RULHQWHG
● %DVHGRQPDUNHWJURZWKSRWHQWLDODQGGHJUHHRILPSDFWRQVRFLHW\LGHQWLI\¿YHSULRULW\EXVLQHVVDUHDVDWWKHLQWHUVHFWLRQRI(6+UHODWHGLVVXHVDQG',&¶VFRPSHWLWLYHVWUHQJWKV● 3URPRWH9DOXH7UDQVIRUPDWLRQLQVPDUWOLYLQJFRORUVFLHQFHDQGVXVWDLQDEOHSDFNDJLQJWRPDNHWKHVHEXVLQHVVHVPRUHVXVWDLQDEOH

Business Portfolio Transformation: Five Priority Business Areas

Sustainable energy

Healthcare‫ٴ‬Specialty materials that contribute to the realization of the high-performancesecondary batteries and fuel cells crucial to an electrified/hydrogenpowered society‫ٴ‬High-performance nutritional supplements that support the health of peopleof all ages
‫ٴ‬Healthcare-related products and services that deliver safety,
peace of mind and comfort, contributing to a future in whichpeople enjoy an improved QOL

e.g.

Materials for secondary batteries and fuel cells
Functional organic fillers

e.g.

High-performance nutritional products
Natural skincare materials

Smart living

Color science

Sustainable packaging‫ٴ‬High-performance materials and solutions
that contribute to the realization of a sustainable
society that coexists with a healthy global
environment‫ٴ‬Chemical solutions for modern lives that have
evolved and improved thanks to digitalization‫ٴ‬Color that is sustainable and ecologically sound‫ٴ‬Products with outstanding decorative properties
that facilitate the creation of comfortable spaces‫ٴ‬Functional materials that leverage dyeing
technologies to deliver convenience,satisfaction, safety and peace of mind

‫ٴ‬Materials that ensure tastier, more enjoyable andsafer merchandise reaches consumers‫ٴ‬Materials that deliver both safety, /peace of mind
and convenience, as well as help reduce food loss
‫ٴ‬Product design that contributes to environmental
soundness, i.e., is conducive to recycling anduses plant-derived and renewable raw materials

Materials for 5G/6G-enabled
devices, resins for nexte.g. generation semiconductors,
bonding solutions forheterogeneous materials

Functional pigments (forLiDAR signal coatings, ande.g. heat-blocking coatings,)
biomass pigments, natural
colorants for cosmetics

Materials with outstanding
barrier properties, biomasse.g. packaging, recycling systems(chemical recycling, materials
recycling)

Value Creation Strategies● (VWDEOLVKVXVWDLQDEOHHQHUJ\DQGKHDOWKFDUHDVQHZEXVLQHVVSLOODUV

Value Creation Essentials▶ Smart living ▶ Color science ▶ Sustainable packaging

Value Creation Cornerstones▶ Sustainable energy ▶ Healthcare

Five Strategies to Transform DIC’s Business Portfolio● %XLOGDVWUDWHJLFKXPDQUHVRXUFHVSRUWIROLRWKDWPD[LPL]HVWKHYDOXHRIKXPDQFDSLWDO
Data

Reinforce management of human capital

Make strategic investments

Enhance the technology platform● ,QYHVWVWUDWHJLFDOO\LQFOXGLQJLQ0 $VWRWUDQVIRUPWKHEXVLQHVVSRUWIROLR● %XLOGDQHZEXVLQHVVSRUWIROLRWKDWWDNHV52,&LQWRDFFRXQW● 6KLIWWR5 'WKDWOHYHUDJHVFRPSXWDWLRQDOVFLHQFH● (VWDEOLVKQHZEDVLFWHFKQRORJLHV

Establish a more robust global
PDQDJHPHQWFRQÀJXUDWLRQ● $GRSWDVRSKLVWLFDWHGJOREDOPDQDJHPHQWPRGHODQGDFFHOHUDWHJOREDOH[SDQVLRQLQ¿YHSULRULW\EXVLQHVVDUHDV

Promote IT and DX● 8VHGLJLWDOWHFKQRORJLHVWRSURYLGHQHZDGGHGYDOXHDQGUHYDPSWKH*URXS¶VEXVLQHVVVWUXFWXUH

DIC Report 2022 ̲20

2Sustainability Strategies● :RUNWRH[SDQGVXVWDLQDEOHSURGXFWVWKDWLVSURGXFWVWKDWGHPRQVWUDWHXQLTXHFRPSHWLWLYHVWUHQJWKVDQGUHVSRQGWR(6+UHODWHGLVVXHV

7DUJHW,QFUHDVHVXVWDLQDEOHSURGXFWVWRRIQHWVDOHVE\ÀVFDO\HDU ÀVFDO\HDU● 3URPRWHHIIRUWVWRUHGXFH&2HPLVVLRQVDQGKHOSUHDOL]HDFDUERQQHXWUDOVRFLHW\

Target: Achieve carbon neutrality by 2050 and reduce annual CO2HPLVVLRQV 6FRSHDQG E\IURPWKHÀVFDO\HDU
OHYHOE\ÀVFDO\HDU

Value Creation Essentials● $GYDQFHHIIRUWVWRUHVSRQGWRDFLUFXODUHFRQRP\WKHUHE\FRQWULEXWLQJWRDVXVWDLQDEOHVRFLHW\Greenz Achieve carbon neutralityz Realize a circular economy

Value Creation Strategies
Value Creation Cornerstones

z Propel the evolution of information and communicationsz Drive the evolution of CASE vehicles and MaaSz Promote the development of AI and IoT technologies

QOL
z Deliver safety, peace of mind and conveniencez Prolong healthy life expectancyz Embrace diverse values

Sustainable product examples

z Contain renewable materials
z Lower energy use, improve
insulation and reduce weightz Address the issue of marine
plastics
z Can be recycled
z Reduce wastez Prolong product life

Digital

Data

Value provided
by DIC products

The society to which DIC seeks to contribute

Sustainableenergy嵣 Materials for next-generation secondary
batteries and fuel cells
嵣 Functional inorganic fillers

Sustainable
packaging嵣 Materials with outstanding barrier properties
嵣 Biomass packaging

Color science嵣 Biomass pigments
嵣 Functional pigments for heat-blocking coatings

Smart living

嵣 Materials for 5G/6G-enabled devices
嵣 Resins for next-generation semiconductors

Color science嵣Functional pigments for LiDAR signal coatings

Healthcare

嵣 High-performance nutritional products嵣 Natural skincare materials

Color science嵣 Natural colorants for cosmetics

z Contribute to high-capacity,
high-speed communicationsz Support the IoTz Contribute to health and comfort
z Help reduce food lossz Reduce emissions of volatileorganic compounds (VOCs) andenhance safety

Consolidated Results Targets (Fiscal Years 2022–2025)(Billions of yen)

2021
Actual2022
Targets

2025
Targets

Change from2021

Net sales

855.4

950

1,100

+29٫

Operating income

42.9

54

80

+37.1

Operating margin

5.0%

5.7%

7.3%

+2.3 pt

Net income

4.4

28

45

+40.6

EBITDA*1

69.0

88

137

+68

ROIC*2

4.8%

5.2%

6.0%

+1.2 pt

Net D/E ratio*3(Net D/C ratio) *4

1.0

1.0

1 time(47.6%)(48.7%)

ٕ*1 EBITDA = Net income + Total income taxes + (Interest expenses – Interest income) + Depreciation and amortization*2 ROIC = Net operating income after tax / (Net interest-bearing debt + Net assets)*3 Net D/E ratio = Net interest-bearing debt / Net worth*4 Net D/C ratio = Net interest-bearing debt / (Net interest-bearing debt + Net assets)

21̲ DIC Report 2022

Less than‫ق‬Less than 50%‫ك‬12-Year Summary
Key Financial Data
113

Period

2010

Fiscal year

115

2011

116

2012

2013

*3

117

118

119

120

121

122

123





2015

2016

2017

2018

2019

2020

2021

1HWVDOHV %LOOLRQVRI\HQ

779.0

734.3

703.8

784.0

830.1

820.0

751.4

789.4

805.5

768.6

701.2

855.4

2SHUDWLQJLQFRPH %LOOLRQVRI\HQ

37.2

35.0

38.5

44.1

41.1

51.1

54.2

56.5

48.4

41.3

39.7

42.9

2SHUDWLQJPDUJLQ 

4.8

4.8

5.5

5.6

4.9

6.2

7.2

7.2

6.0

5.4

5.7

5.0

26.3

23.7

23.0

19.8

25.3

26.8

26.2

27.4

28.4

27.9

26.2

28.0

11.0

9.1

8.8

8.8

10.9

12.2

11.2

12.4

12.9

12.5

12.0

13.5

2UGLQDU\LQFRPH %LOOLRQVRI\HQ

31.7

30.8

35.1

40.9

39.9

49.0

55.8

57.0

48.7

41.3

36.5

43.8

1HWLQFRPHDWWULEXWDEOHWRRZQHUVRIWKHSDUHQW %LOOLRQVRI\HQ

15.8

18.2

19.1

28.8

25.2

37.4

34.8

38.6

32.0

23.5

13.2

4.4

(%,7'$ %LOOLRQVRI\HQ

63.7

61.5

65.2

69.1

77.0

94.0

82.6

86.1

81.4

67.4

55.6

69.0

(%,7'$PDUJLQ 

8.2

8.4

9.3

9.8

9.3

11.5

11.0

10.9

10.1

8.8

7.9

8.1

7RWDODVVHWV %LOOLRQVRI\HQ

703.8

675.1

693.0

761.7

803.7

778.9

764.8

831.8

801.3

803.1

818.0

1,071.5

Net assets %LOOLRQVRI\HQ

130.4

124.5

160.7

218.9

276.7

289.9

307.0

344.0

327.3

343.5

351.4

381.0

(TXLW\UDWLR 

15.3

15.1

19.8

25.6

31.1

33.7

36.4

37.9

37.3

38.9

38.9

32.3

1HW LQWHUHVWEHDULQJ GHEW
%LOOLRQVRI\HQ

314.7

298.8

293.0

283.6

257.4

244.1

224.0

247.8

244.7

235.8

221.9

346.0

1HW'(UDWLR 7LPHV

2.9

2.9

2.1

1.5

1.0

0.9

0.8

0.8

0.8

0.8

0.7

1.0

1HW'&UDWLR 

70.7

70.6

64.6

56.4

48.2

45.7

42.2

41.9

42.8

40.7

38.7

47.6

5 'DQGWHFKQRORJ\UHODWHG
H[SHQVHV*1 %LOOLRQVRI\HQ
2IZKLFK5 'FRVWV %LOOLRQVRI\HQ

Value Creation Essentials,QFRPH

Value Creation Strategies

Financial Position

30.9

31.2

41.4

33.9

46.4

29.1

62.5

54.2

51.0

50.6

54.5

44.8

(12.3)(17.6)(23.7)(9.8)(27.4)(10.0)(32.2)(58.9)(38.4)(24.9)(33.0)(147.6))UHHFDVKÀRZ %LOOLRQVRI\HQ

18.6

13.7

17.7

24.0

19.0

19.1

30.3

(4.7)

12.6

25.8

21.4

(102.8)(26.3)(7.1)(26.6)(32.8)(26.1)(24.8)(26.9)

11.4(11.8)(26.8)

6.3

99.5

22.9

29.6

22.5

15.0

16.4

15.1

16.7

17.7

18.6

16.7

41.4

37.6

1HW FDVK SURYLGHG E\ XVHG LQ 
¿QDQFLQJDFWLYLWLHV %LOOLRQVRI\HQ&DVKDQGFDVKHTXLYDOHQWV%LOOLRQVRI\HQ

3HU6KDUH,QIRUPDWLRQ(DUQLQJVSHUVKDUH <HQ

175.96

197.90207.98292.26267.81

389.40366.72407.56338.40248.29139.81

46.12

3ULFHHDUQLQJVUDWLR 3(5
7LPHV

11.0

8.4

9.5

10.9

10.9

8.5

9.7

10.5

10.0

12.2

18.6

62.8

'LYLGHQGVSHUVKDUH <HQ

40

40

60

60

60

80

100

120

125

100

100

100

22.7

20.2

28.8

20.5

22.4

20.5

27.3

29.4

36.9

40.3

71.5

216.8

52,& 

5.8

5.8

6.3

6.1

5.7

6.9

7.3

7.2

6.0

5.2

5.0

4.8

5HWXUQRQHTXLW\ 52(  

15.1

17.3

16.0

16.1

11.3

14.6

12.9

13.0

10.4

7.7

4.2

1.3

20.8

27.0

26.6

27.1

33.6

32.1

31.3

33.6

32.1

35.0

34.0

38.6

33.0

29.7

27.4

25.9

33.8

32.9

32.4

31.5

32.8

33.1

32.6

37.4

2YHUVHDVVDOHVUDWLR 

57.3

58.2

56.7

66.6

63.4

65.1

62.4

63.4

63.6

63.5

64.8

67.3

$YHUDJHH[FKDQJHUDWH 86

87.69

79.77

79.93

97.06

106.32120.85109.96112.33110.46109.11106.37109.75

3D\RXWUDWLR 

2WKHU,QGLFDWRUV&DSLWDOH[SHQGLWXUH%LOOLRQVRI\HQ'HSUHFLDWLRQDQGDPRUWL]DWLRQ%LOOLRQVRI\HQ$YHUDJHH[FKDQJHUDWH (85116.63110.88103.11129.25141.41134.14122.06127.03130.46122.13121.43129.73

1XPEHURIHPSOR\HHV

21,572

20,455

20,273

20,034

20,411

20,264

20,481

20,628

20,62020,513

20,242

22,474

7HFKQRORJ\UHODWHGH[SHQVHVDUHIRU',&DQG',&*UDSKLFV&RUSRUDWLRQ3HUVKDUHLQIRUPDWLRQKDVEHHQDGMXVWHGWRUHIOHFWWKHLPSDFWRIWKHFRQVROLGDWLRQRIVKDUHV(IIHFWLYHIURP¿VFDO\HDU',&DQGLWVGRPHVWLFFRQVROLGDWHGVXEVLGLDULHVFKDQJHGWKHLU¿VFDO\HDUHQGIURP0DUFKWR'HFHPEHU$VDFRQVHTXHQFHUHSRUWHGUHVXOWVUHÀHFWWKHIDFWWKDWIRUWKHVHFRPSDQLHV¿VFDO\HDUZDVDWUDQVLWLRQDOLUUHJXODUQLQHPRQWKSHULRG)RUWKHSXUSRVHRIFRPSDULVRQ¿VFDO\HDU¿JXUHVKHUHKDYHEHHQDGMXVWHGWRUHSUHVHQWWKHPRQWKVIURP-DQXDU\±'HFHPEHU

DIC Report 2022 ̲22

Data

1HWFDVKSURYLGHGE\RSHUDWLQJDFWLYLWLHV %LOOLRQVRI\HQ
1HWFDVKXVHGLQLQYHVWLQJDFWLYLWLHV%LOOLRQVRI\HQ

Value Creation Cornerstones&DVK)ORZVA Message from the CFOWith the aim of achieving the goals of DIC Vision 2030,
we have adopted ROIC as a metric and are working torealize business portfolio transformation.

Shuji Furuta

Strategic investments¥230 billion
Investments ininfrastructure building

Net D/E ratio

Financialhe1.0 times

Maximize cash
generated

tur

ns t

¥70 billion

Inve
stm

h
alt

er s

Value Creation Strategies
Value Creation Cornerstones

With the aim of ensuring we evolve into the organization envisioned in our long-term
PDQDJHPHQWSODQ',&9LVLRQIRUPXODWHGLQ¿VFDO\HDUZHKDYHDGRSWHG
UHWXUQRQLQYHVWHGFDSLWDO 52,& ZKLFKUHIOHFWVLQYHVWPHQWHIILFLHQF\DQGHDUQLQJSRZHUDVDPHWULFDQGDUHSURPRWLQJWKHWUDQVIRUPDWLRQRIRXUEXVLQHVVSRUWIROLR2XUDSSURDFKWRILQDQFLDOPDQDJHPHQWFHQWHUVRQEDODQFLQJWKUHHSULRULWLHV0DLQWDLQLQJ
VRXQGILQDQFLDOKHDOWKLQYHVWLQJLQJURZWKDQGHQVXULQJUHWXUQVWRVKDUHKROGHUVWKDWDUHFRPPHQVXUDWHZLWKLQFRPHJURZWK:HZLOODOVRDFWLYHO\SODFHVXVWDLQDELOLW\DWWKH
FHQWHURI¿QDQFLQJHIIRUWV,QDGGLWLRQWR52,&XQGHU',&9LVLRQZHZLOOHPSKDVL]HWKHQHWGHEWWRHTXLW\ '( ratio*1WRJDXJH¿QDQFLDOKHDOWKWKHSD\RXWUDWLRWRHYDOXDWHUHWXUQVWRVKDUHKROGHUVDQGHDUQLQJVEHIRUHLQWHUHVWWD[HVGHSUHFLDWLRQDQGDPRUWL]DWLRQ (%,7'$ 2 to judge
DELOLW\WRJHQHUDWHFDVKDVLQGLFDWRUVRI¿QDQFLDOSHUIRUPDQFHDQGHIIRUWVWRPD[LPL]HVKDUHKROGHUYDOXH

Re

Data

| Basic Approachrow
s in g th
ent

Value Creation Essentials'LUHFWRU([HFXWLYH2IÀFHU
Head of Finance and Accounting Unit, CFOo s hareho

Payout ratio

ld

30 %

Metric: ROIC

| Emphasis on Boosting ROIC and Maintaining Sound Financial Health:HKDYHVHWDORQJWHUPJRDORIERRVWLQJ52,&WRSOXVLQ¿VFDO\HDU7RDGYDQFHWKHWUDQVIRUPDWLRQRIRXUEXVLQHVVSRUWIROLRDQG
IXUWKHUEROVWHUFDSLWDOHI¿FLHQF\ZHDUHPDNLQJWKHPRVWRIFDVKJHQHUDWHGLQEXVLQHVVHVZLWKVWDEOHHDUQLQJVEDVHVWKURXJKUHLQYHVWPHQWLQ
QH[WJHQHUDWLRQJURZWKEXVLQHVVHVDQGKDYHHVWDEOLVKHGFULWHULDIRUZLWKGUDZLQJIURPEXVLQHVVHVZLWKORZJURZWKSRWHQWLDODQGSUR¿WDELOLW\:HHPSOR\(%,7'$DQGWKHFDVKFRQYHUVLRQF\FOH &&& DVPHWULFVIRUFDVKSURYLGHGE\RSHUDWLQJDFWLYLWLHV,QDGGLWLRQWRXVLQJ(%,7'$WR
PHDVXUHRXUDELOLW\WRJHQHUDWHFDVKZHPRQLWRUWKHGHEWWR(%,7'$UDWLRWRDVVHVV¿QDQFLDOVRXQGQHVVIURPWKHSHUVSHFWLYHRIFDVKÀRZ:H
DOVRPDQDJH&&&XVHGWRDVVHVVZRUNLQJFDSLWDOPHWLFXORXVO\E\DPRQJRWKHUVVHWWLQJUHJLRQDOWDUJHWV2XUJRDOIRU¿QDQFLDOVRXQGQHVVLVWRPDLQWDLQRXUQHW'(UDWLRDWDURXQGWLPHVXQGHUVFRULQJRXUGHWHUPLQDWLRQWRXSKROGVRXQG¿QDQFLDOKHDOWKZKLOHDOVRSXUVXLQJDQDFWLYHLQYHVWPHQWVWUDWHJ\:HZLOODOVRFRQWLQXHFUHDWLQJVDIHW\QHWVDJDLQVWVXGGHQVKDUSÀXFWXDWLRQVLQWKH
RSHUDWLQJHQYLURQPHQWLQFOXGLQJE\SURFXULQJIXQGVWKURXJKVXERUGLQDWHGWHUPORDQVDW\SHRIK\EULG¿QDQFLQJUHFRJQL]HGE\FUHGLWUDWLQJDJHQFLHVDVKDYLQJHTXLW\FUHGLWDWWULEXWHVHVWDEOLVKLQJDJOREDOFRPPLWPHQWOLQHDQGNHHSLQJWKHSHUFHQWDJHRIWRWDOERUURZLQJVDFFRXQWHGIRU
E\ORQJWHUPGHEWDW
Net interest - bearing debt (Billions of yen)
Shareholders’ equity (Billions of yen)
Net D/E ratio (Times)

Financial Health

Maintain a net D/E ratioof around 1.0 times

ROIC (%)

ROIC*・EBITDA

EBITDA (Billions of yen)

8.0-plus

1.00
0.82

0.75

5.2

346.0 345.9
312.7

298.9
244.7

235.8

6.0

6.0

0.70

5.0

318.5

4.8

221.9

5.1
137.0

88.0

81.4
69.0

67.4
55.6

2018

2019

2020

2021

2022

(Forecast)

(FY)

2018

2019

2020

2021

2022

(Forecast)

2025(Target)2030 (FY)(Target)* ROIC: Operating income x (1 – effective tax rate) / (Net interest-bearing debt + Net assets)

23̲ DIC Report 2022

| Investments to Accelerate Growth
7RDFKLHYHWKHWDUJHWVRI',&9LVLRQZHZLOODOORFDWHDWRWDORIELOOLRQWRLQYHVWPHQWV²FRPSULVLQJELOOLRQIRUVWUDWHJLFLQYHVWPHQWV
DQGELOOLRQIRULQYHVWPHQWVLQLQIUDVWUXFWXUHEXLOGLQJ²RYHUWKHIRXU\HDUVIURP¿VFDO\HDUWKURXJK¿VFDO\HDU6WUDWHJLFLQYHVWPHQWVZLOOIRFXVRQDGYDQFLQJ9DOXH7UDQVIRUPDWLRQLQWKUHHRIWKH¿YHSULRULW\EXVLQHVVDUHDVVHWIRUWKLQWKHSODQ VPDUWOLYLQJFRORUVFLHQFHDQG
VXVWDLQDEOHSDFNDJLQJ WRPDNHWKHVHEXVLQHVVHVPRUHSURILWDEOHDQG1HZ3LOODU&UHDWLRQLQWKHUHPDLQLQJWZR VXVWDLQDEOHHQHUJ\DQG
KHDOWKFDUH WRHVWDEOLVKWKHVHDVQHZEXVLQHVVSLOODUV,QYHVWPHQWVLQLQIUDVWUXFWXUHEXLOGLQJZLOOHPSKDVL]HFRQWULEXWLQJWRVXVWDLQDELOLW\LQFOXGLQJWKURXJKWKHUHGXFWLRQRI&22HPLVVLRQVHQKDQFLQJRXUWHFKQRORJ\SODWIRUPDQGSURPRWLQJ,7DQGGLJLWDOWUDQVIRUPDWLRQ ';  Principal Strategic Investments

Investments in start-ups/capital ties

Green Science Material, Inc.

Liaoning Tianqi
Technology Co., Ltd.

Vaxa Technologies Ltd.

May 2020
Expand gravure inks production basein the PRC(Packaging & Graphic)

June 2021 Cost of acquisition: €1,010 million
Expand functional pigments portfolio(Color & Display)

April 2021 Israel
Expand business byadding depth to biotechnology
capabilities and expanding
related businesses

Seller Ink
Green Science Materials, Inc.

September 2020
Secure specialty inks production
base in Central America(Packaging & Graphic)

SAPICI S.p.A.
Sensient Imaging
Technologies
June 2020
Expand jet inks portfolio(Packaging & Graphic)

Ideal Chemi Plast Private Limited

January 2022
Expand packaging adhesives portfolio(Packaging & Graphic, Functional Products)

May 2019
Secure coating resins production
base in India(Functional Products)

9DOXH&UHDWLRQ6WUDWHJLHVVaxa Technologies Ltd.

Packaging & Graphic
Color & Display
Functional Products| Promoting Sustainable Finance:HFRQWLQXHWRDFFHOHUDWHHIIRUWVWRVHFXUHVXVWDLQDEOH¿QDQFHZLWKWKHDLPRISURPRWLQJWKHVXVWDLQDELOLW\VWUDWHJLHVRI',&9LVLRQDVD
FRUHFDWHJRU\RIVWUDWHJLHVVHWIRUWKLQWKHSODQ7KHWHUP³VXVWDLQDEOH¿QDQFH´GHVFULEHVWKHSUDFWLFHRILQFRUSRUDWLQJ(6*FULWHULD²LQFOXGLQJHQYLURQPHQWDOLVVXHVVXFKDVFOLPDWHFKDQJHDQGVRFLDOFRQVLGHUDWLRQVVXFKDVKXPDQULJKWVDQGSRYHUW\²LQWR¿QDQFLDOVHUYLFHVWRKHOSEULQJDERXWVXVWDLQDEOHRXWFRPHV:HDUHFRPPLWWHGWRHQWHULQJLQWRVXVWDLQDEOH¿QDQFHDJUHHPHQWVWRDGYDQFHRXUVXVWDLQDELOLW\VWUDWHJLHVDVZHOODVWRFRQWULEXWHWRWKHDFKLHYHPHQWRIWKH6'*V

Major Achievements in Sustainable FinanceTiming

9DOXH&UHDWLRQ(VVHQWLDOVMarch 2021 Japan
Expand algae products portfolio

Value Creation Cornerstones

BASF Colors & Effects

Description%HFRPHV¿UVWFKHPLFDOVLQGXVWU\FRPSDQ\WRVLJQ0L]XKR(FR)LQDQFHFRQWUDFWZLWK0L]XKR%DQN/WG

September 2020

&RQFOXGHV3RVLWLYH,PSDFW)LQDQFH ZLWKXQVSHFLILHGXVHRIIXQGV ORDQDJUHHPHQWZLWK6XPLWRPR0LWVXL7UXVW%DQN/LPLWHG

March 2022

&RQFOXGHV3RVLWLYH,PSDFW)LQDQFHORDQDJUHHPHQWZLWK0L]XKR%DQN/WG

April 2022

(QWHUVLQWRJUHHQORDQDJUHHPHQWZLWK08)-%DQN/WG

| Stable Returns to Shareholders

Data

September 2019

:LWKWKHDLPRIFRQWLQXLQJWRHQVXUHVWDEOHUHWXUQVWRVKDUHKROGHUV',&9LVLRQPDLQWDLQVRXUH[LVWLQJWDUJHWIRUDFRQVROLGDWHG
GLYLGHQGSD\RXWUDWLRRIZKLFKZLOOVHUYHDVDJXLGHOLQHIRU
GLYLGHQGVRYHUWKHPHGLXPWHUP,Q¿VFDO\HDUZHSDLGDIXOOWHUPGLYLGHQGRIFRPSULVLQJDQLQWHULPGLYLGHQGRI
DQGD\HDUHQGGLYLGHQGRI:HDOVRDQWLFLSDWHDQDQQXDOGLYLGHQGRILQ¿VFDO\HDU
'(UDWLR,QWHUHVWEHDULQJGHEW6KDUHKROGHUV¶HTXLW\
(%,7'$1HWLQFRPHDWWULEXWDEOHWRRZQHUVRIWKHSDUHQW7RWDOLQFRPHWD[HV ,QWHUHVWH[SHQVHV±,QWHUHVWLQFRPH 'HSUHFLDWLRQDQGDPRUWL]DWLRQInterim dividend (Yen)
216.8
Year-end dividend (Yen)
Payout ratio (%)

Returns to Shareholders

40.3

71.5

36.9
33.8
125
100

100

100

100

40

50

50

50

60

50

50

50

2018

2019

2020

2021

3.7

3.3

3.8

3.5

65
60

30

Yield
(%)*

2022 (FY)(Forecast)* Dividend yield: Annual dividends / Closing price per share at fiscal year-end

DIC Report 2022 ̲24

Packaging & Graphic
Packaging Materials that Bring
6DIHW\DQG3HDFHRI0LQG
Masamichi Sota

SDGs Goals 12, 13 and 14

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

0DQDJLQJ([HFXWLYH2I¿FHU
President, Packaging & Graphic Business Group

Main ProductsThis segment includes not only
printing inks but also adhesives,
ILOPVDQGDEURDGUDQJHRI
other packaging materials and
VROXWLRQVWKHPDUNHWVIRUZKLFKFRQWLQXHWRVHHUREXVWJURZWKLQ
Asia and emerging economies.

［Printing Materials］*UDYXUHLQNVÀH[RLQNVRIIVHWLQNVQHZVLQNVMHWLQNV
metal decorative inks, printing plates, security inks

［Packaging Materials］
3RO\VW\UHQHSDFNDJLQJDGKHVLYHVPXOWLOD\HU¿OPV

Data

Segment Operating Results
Operating Income

Net Sales(Billions of yen)

439.8
388.4

480.0

21.8

80.2

73.1

FY2020
Japan

5.3

4.8

12.2

13.2

4.4

3.8

295.2

265.1

62.0

24.0

21.6
5.7

114.7

102.3

235.4

(Billions of yen)

119.2

FY2021The Americas
and Europe

China andAsia Pacific

FY2022 (Forecast)

FY2020
Japan

13.8

4.5

FY2021The Americas
and Europe

FY2022 (Forecast)

China andAsia Pacific

1RWH*UDSK¿JXUHVLQFOXGHLQWHUUHJLRQDOWUDQVDFWLRQVZLWKLQWKHVHJPHQW$FFRUGLQJO\WKHDJJUHJDWHVRIUHJLRQDOQHWVDOHVDQGRSHUDWLQJLQFRPH¿JXUHVIRUWKHVHJPHQWGLIIHUIURPWKH¿JXUHVSUHVHQWHGDERYH

25̲ DIC Report 2022

Business Strategies Under DIC Vision 2030
 Looking ahead to the realization of a circular economy, work to develop sustainable next-generation packaging materials with the aim of locking in new
demand and expanding the packaging materials business Take the lead in the market for next-generation sustainable packaging by developing products and proposing solutions compatible with a focus on the “5Rs”*
 Accelerate shift to high-performance, high-value-added products by, among others, expanding specialty products, promoting digitalization and responding
to demand for smart packaging
 Build existing businesses into stable revenue sources by securing organic growth and streamlining operations in Asia

Basic
Strategies

andNet Sales and Operating
Income Targets

10

100
0

2021

2022

0
2025 (FY),QWKH3DFNDJLQJ *UDSKLFEXVLQHVVWKH',&*URXSZRUNVWRKHOSUHDOL]HVDIHVHFXUHDQGFRQYHQLHQWOLIHVW\OHVE\RIIHULQJSDFNDJLQJPDWHULDOVVXLWDEOHIRUDFLUFXODUHFRQRP\:LWKDIRFXVRQWKH5VWKH*URXSZLOOFRQWLQXHVWULYLQJWRDGGGHSWKWRVXVWDLQDEOHWHFKQRORJLHVLQFOXGLQJWKRVH
HVVHQWLDOWRWKHSXVKWRZDUGSDSHUPRQRPDWHULDODQGELRPDVVSDFNDJLQJDVZHOODVWKRVHIRUGHLQNDEOHUHOHDVDEOHDQGSHHODEOHPDWHULDOVZLWKWKHDLPRISURYLGLQJPDUNHWOHDGLQJQH[WJHQHUDWLRQVXVWDLQDEOHSURGXFWV7KH*URXSLVDOVRDGYDQFLQJHIIRUWVWREXLOGDFORVHGORRSUHF\FOLQJ
V\VWHPIRUSRO\VW\UHQHHPSOR\LQJFKHPLFDOUHF\FOLQJOHYHUDJLQJMHWLQNWHFKQRORJLHVWRSURPRWHGLJLWDOL]DWLRQDQGUHVSRQGLQJWRGHPDQGIRU
VPDUWSDFNDJLQJ7KH*URXSZLOOVHHNWREXLOGH[LVWLQJEXVLQHVVHVLQWRVWDEOHUHYHQXHVRXUFHVE\ORFNLQJLQGHPDQGDQGVWUHDPOLQLQJRSHUDWLRQV
in Asia and other promising markets.

Key Development in Fiscal Year 2021',&*UDSKLFV([SDQGV,WV/LQHXSRI6,$$&HUWLÀHG$QWLEDFWHULDODQG$QWLYLUDO9DUQLVKHVDQG(QYLURQPHQW)ULHQGO\3URGXFWVImparting outstanding antibacterial and antiviral properties to packaging for food products and daily necessities as well as a broad
range of printed materials,Q ILVFDO \HDU  ',& *URXS FRPSDQ\ ',& *UDSKLFVH[SDQGHGLWVOLQHXSRIDQWLEDFWHULDODQGDQWLYLUDOYDUQLVKHVIRU XVH ZLWK JUDYXUH IOH[R DQG RIIVHW SULQWLQJ LQNV WKDWKDYHHDUQHG6RFLHW\RI,QWHUQDWLRQDOVXVWDLQLQJJURZWKIRU
$QWLPLFURELDO$UWLFOHV 6,$$ FHUWL¿FDWLRQDQGWKXVEHDUDQSIAA mark.
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Value Creation Essentials

20
200

Value Creation Strategies

30
300

Value Creation Cornerstones

40

400

Develop packaging materials and propose packaging solutions with a focus on the 5Rs
嵣 Hasten the global deployment of fast-curing solvent-free adhesive DUALAM ®
嵣 Add depth to sustainable technologies, including those essential to the push toward paper,mono-material and biomass packaging, as well as those for deinking
嵣 Build a closed-loop recycling system for polystyrene employing chemical recycling
Propose packaging solutions that capitalize on Group capabilities and deliver safety,
peace of mind and convenience嵣 Develop functional films, including resealable products and peelable offerings forcontainer lid films
嵣 Capitalize on technologies for reducing foreign matter in packaging materials to improve safety
and peace of mind
Address needs arising from the spread of digitalization
嵣 Expand applications for water-based jet inks for industrial printing
嵣 Respond to increased use of jet inks for printing on packaging(paper containers, corrugated cardboard, labels, etc.) and on textiles

Data

500

Operating income (Billions of yen)

50

600

Net sales (Billions of yen)

Principal
MeasuresColor & Display
Color and Display Materials that
0DNH/LIH&RORUIXO
Yoshinari Akiyama

SDGs Goals 3 and 13

Value Creation Strategies

Value Creation Essentials

0DQDJLQJ([HFXWLYH2I¿FHU
President, Color & Display Business Group

Data

Value Creation Cornerstones

Main Products
3URGXFWVLQWKLVVHJPHQWLQFOXGHDZLGH
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colorants and other materials that are
VDIHDQGJHQWOHIRUXVHE\SHRSOH

［Color Materials］
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7KLQ¿OPWUDQVLVWRUOLTXLGFU\VWDO 7)7/& PDWHULDOVVXSHUWZLVWHGQHPDWLF
OLTXLGFU\VWDO 671/& PDWHULDOVSegment Operating Results
Net Sales

16.0

Operating Income (Loss)(Billions of yen)(Billions of yen)

220.0
167.2

7.2

30.3

8.4

4.0

32.6

105.8

5.6

27.9

209.3

8.8

6.9

145.7

2.8

85.2
‒2.8

FY2020Japan

FY2021
Overseas

FY2022 (Forecast)

FY2020Japan

FY2021

FY2022 (Forecast)

Overseas

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27̲ DIC Report 2022

Business Strategies Under DIC Vision 2030
 Establish an unrivaled competitive advantage by swiftly realizing synergies with the Colors & Effects business Shift focus to materials with outstanding decorative properties and functionality and increase the weighting of sustainableproducts that deliver both social value and economic value
 Redefine “Spirulina business” as “healthcare business”
 Redefine “LCs business” as “electronics business”

50
40

200
30
20
100
10
0
2021

0
2025 (FY)2022.

Operating income (Billions of yen)

Net sales (Billions of yen)

300

Expand selection of sustainable materials, functional materials and materials withoutstanding decorative properties
嵣 Focus on the expansion of effect pigments with outstanding decorative properties
and sustainable color materials that are safe and environment friendly嵣 Emphasize functional pigments, including those for LiDAR signal coatings, which
are key to autonomous driving vehicles
嵣 Enter the markets for red and yellow pigments for displays
Enhance pigments for cosmetics business嵣 Expand effect pigments for cosmetics
嵣 Broaden portfolio of naturally derived products
Reinforce healthcare business by introducing new products
嵣 Expand portfolio beyond Spirulina and Linablue® by adding new nutritional
supplements, natural colorants and cosmetics materials
Create new next-generation businesses, which will join core TFT LCs
嵣 Expand presence in the market for products for electronics applications by augmenting
portfolio of materials for smart windows, and 5G/6G-enabled devices, among others

Value Creation Cornerstones

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SURGXFWVIRUHOHFWURQLFVDSSOLFDWLRQVE\DXJPHQWLQJLWVSRUWIROLRRIPDWHULDOVIRUVPDUWZLQGRZVDQG**HQDEOHGGHYLFHVDPRQJRWKHUV

Value Creation Essentials

Principal
Measures

Value Creation Strategies

Net Sales and Operating
Income Targets

Key Development in Fiscal Year 2021
Sun Chemical Introduces the “What’s IN Asia” Trends Program
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Data

Basic
Strategies

Functional Products)XQFWLRQDO3URGXFWVWKDW$GG&RPIRUWTakashi Ikeda

SDGs Goals 6, 12 and 13

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

0DQDJLQJ([HFXWLYH2I¿FHU
3UHVLGHQW)XQFWLRQDO3URGXFWV%XVLQHVV*URXSMain Products［Performance Materials］

This segment provides coating and
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electronics materials［Composite Materials］
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Data

Segment Operating Results
Net Sales

Operating Income(Billions of yen)(Billions of yen)

26.2

300.0

283.3
236.0

17.1
203.2

201.3

25.0

16.1

14.4

10.1

10.6

8.3

176.1

127.3

108.3

80.9

FY2020Japan

FY2021
Overseas

8.7

FY2022 (Forecast)

FY2020Japan

FY2021

FY2022 (Forecast)

Overseas

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29̲ DIC Report 2022

Business Strategies Under DIC Vision 2030
 Ensure the timely provision of functional materials that support digital innovation
 Contribute to a carbon-neutral society by promoting a shift to biomaterials
 Cultivate demand by directly communicating the appeal of materials, devices and services to consumers and society Supply polymers that help reduce environmental impact and impart functionality widely across Asia
Principal
Measures

Net Sales and Operating
Income Targets

300

30
200
20
100

10

0

0
2021

2022

嵣 Extend functional materials portfolio with forward-looking offerings for an
increasingly digital society, including low-dielectric resins, organic–inorganic hybrid
resins and resins for optical materials
嵣 Augment lineup of industrial adhesive tapes and PPS compounds, and offer bonding
and disassembly solutions, for CASE vehicles
Develop sustainable products嵣 Launch and expand sales of new environment-friendly waterborne resins嵣 Develop and offer bio-based polymers
Increase selection of products that contribute to an improved QOL
嵣 Augment portfolio of molding materials for medical applications
Expand operations in promising geographic areas
嵣 Concentrate efforts to expand coating resins business in the PRC and theAsia–Pacific region on M&As

2025 (FY).

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Key Development in Fiscal Year 2021',&/DXQFKHV*OREDO&RPPRQ&RDWLQJ5HVLQV3URGXFW)LQGHU

Value Creation Essentials

40

Operating income (Billions of yen)

Net sales (Billions of yen)

Propose high-performance products for the semiconductor fabrication and mobility fields

50

400

Value Creation Strategies

Basic
Strategies

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2
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Value Creation Cornerstones

Allowing the timely provision of information and enhancing search convenience in Japanese, English and ChineseNew Business Development
New Businesses Created from the Perspective of
ESH-Related Issues and Social Changes

Value Creation Strategies

Value Creation Essentials

SDGs Goals 8, 9 and 11

Kiyofumi Takano

0DQDJLQJ([HFXWLYH2I¿FHU
General Manager, New Business Development
Headquarters

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social changes intersect with the DIC Group’s competencies. The Group is making active use of external resources to secure access to new technologies with the
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automotive area.
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Value Creation Cornerstones

Business Strategies Under DIC Vision 2030
 Create businesses that reflect the dynamics of socioeconomic systems, including those for distributed energy and packaging materials recycling

Basic
Strategies

 Accelerate the creation of new businesses by actively using CVC and M&As to secure new technologies

Net Sales and Operating Income
Targets for Fiscal Year 2025

Net salesData¥

33 billion

Operatingincome¥10 billion

Principal
Measures

Electronics
嵣 Expand sales of silver seed film developed to reduce transmission loss in high-band communications
嵣 Bolster sales of flexible wireless sensors (Hatte Totte®)
Automotive
嵣 Commercialize materials for next-generation secondary batteries and fuel cells that support the move
to clean energy–powered automobiles
嵣 Develop new inorganic fillers and expand sales of existing offerings for use in automotive electronics
and carbon fiber–reinforced plastic (CFRP) materials that help reduce vehicle weigh
Next-generation packaging
嵣 Realize the practical implementation of materials recycling for flexible packaging films andcommercialize recycled plastics
嵣 Develop and launch high-performance barrier films
Healthcare嵣 Develop and boost sales of nutritional supplements (docosahexaenoic acid (DHA), next-generation omega-3 fatty acids)
嵣 Expand portfolio of biomaterials, including natural colorants and skincare materials',&9LVLRQRXWOLQHV',&¶VLQWHQWLRQWROHYHUDJHQHZEDVLFWHFKQRORJLHVQDPHO\LQRUJDQLFPDWHULDOVGHVLJQDQGELRPDWHULDOVGHVLJQWRVXSSRUWLWVHIIRUWVLQLWV
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31̲ DIC Report 2022

Sun Chemical’s Activities
Sun Chemical grows while navigating the pandemic
Myron Petruch
President and CEO, Sun Chemical Corporation

Value Creation Essentials'HVSLWHWKHFKDOOHQJHVRIRSHUDWLQJLQWKHHYHUFKDQJLQJZRUOGRISDQGHPLFLQGXFHGKHDOWKVDIHW\SURGXFWVXSSO\DQGGLVWULEXWLRQLVVXHV6XQ&KHPLFDOGHPRQVWUDWHGWKDWRXUFRPPLWPHQWWRFXVWRPHUVHPSOR\HHV
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success stories!

■ New Technologies Strengthened Our Portfolio and Enhanced Our Business

Value Creation Cornerstones

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Pigments group to form our Color Materials Division. This business represents the market leader
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FKDOOHQJHVZHOHYHUDJHRXUVWURQJPDUNHWUHODWLRQVKLSVDQGXQSDUDOOHOHGDJLOLW\WRPHHWPDUNHWGHPDQGVDQG¿QGLQQRYDWLYHDQGVRFLDOO\UHVSRQVLEOHVROXWLRQVIRURXUFXVWRPHUV■ Navigating Supply Chain Volatility with Focus on Our Customers

and Employees

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have issued price increases in an effort to keep pace with these rising costs, our relentless focus is
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manufacturing sites to adjust production schedules, and ensuring strong communications throughout
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■ Focus on Safety and Quality at Our Manufacturing Sites
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their support for one another and our business inspired us all. We continue to make social and
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WHDPPHPEHUVDQGWKHLUIDPLOLHVIHHOLQFOXGHGDQGZDUPO\VXSSRUWHGDIC Report 2022 ̲32

DIC Asia Pacific’s Activities
Remaining nimble amid tough market conditions
Paul Koek
Managing Director, DIC Asia Paciﬁc Pte Ltd

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

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our customers, while continuing to implement measures to keep members safe and optimize operations.

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■ Rising Demand for Sustainable Food Packaging
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toward delivering our commitments to our valued customers.
Our heroes in DIC Vietnam■ Award–Winning Dedication and Loyalty in Vietnam,Q-DQXDU\',& 9LHWQDP &R/WGZDVDZDUGHGDFHUWL¿FDWHRIDSSUHFLDWLRQE\WKH*URXSLQUHFRJQLWLRQIRUWKHLUVWURQJGHGLFDWLRQDQGOR\DOW\WRWKH&RPSDQ\DQGRXUFXVWRPHUV'XULQJWKH
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at the factories or working from home. The high vaccination rates across the regional countries
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to the plants.
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heart of our business.
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33̲ DIC Report 2022

DIC (China)’s Activities
Sun Tzu said, “He will win whose army is animated by the same spirit
throughout all its ranks.” DIC (China) seeks to embody this tenet bybuilding an organization in which management and employees areunited and focused on the same objectives.
Mao Jianwei',& &KLQD RYHUVHHVDSSUR[LPDWHO\',&*URXSFRPSDQLHVLQWKH35&RIYDULRXVVL]HVRSHUDWLQJLQGLYHUVHHQYLURQPHQWV
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the DIC Group is working to establish integrated global management while at the same time further strengthening its product
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■ Improving Labor Productivity through Automated and Intelligent Processes

National forklift contest winners

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LPSURYHPHQWVWRSURGXFWLRQSURFHVVHVQRWDEO\E\LQWURGXFLQJDXWRPDWHGDQGLQWHOOLJHQWVROXWLRQV:HDUHFRQ¿GHQWWKDWVXFKHIIRUWVWRHQKDQFHODERUSURGXFWLYLW\DQGLQWURGXFHVWDWHRIWKHDUWWHFKQRORJLHVZLOOHQDEOHXVWRVHFXUHWKHTXDOLW\DQGFRVWDGYDQWDJHVQHHGHGWRWKULYHLQWKLVLQWHQVHO\FRPSHWLWLYHPDUNHW■ Bolstering Employee Potential and Maximizing the Value of Human Resources$FKLHYLQJWKHJRDOVRI',&9LVLRQZLOOQRWEHHDV\)RUWKLVUHDVRQLWLVFUXFLDOWREROVWHUWKHSRWHQWLDORIHDFK*URXSHPSOR\HHDQGPD[LPL]HWKHYDOXHRIKXPDQUHVRXUFHVE\PRGLI\LQJWKH',&*URXS¶VSURGXFWSRUWIROLRLQUHVSRQVHWRFKDQJHVLQWKHRSHUDWLQJHQYLURQPHQWWKHUHE\WDNLQJRQWKHFKDOOHQJHRIGULYLQJLQQRYDWLRQDQGHQWHULQJQHZEXVLQHVVDUHDV,QUHFHQW\HDUV',& &KLQD KDVSODFHGDQLQFUHDVHGHPSKDVLVRQLQWHJUDWLQJWKHPDQDJHPHQWRI*URXSFRPSDQLHVLQ
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and focused on the same objectives.
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sustainable growth for the entire DIC Group.

Value Creation Strategies■ Prioritizing the Ability to Develop Products that Respond to Local Needs

Value Creation Cornerstones,Q¿VFDO\HDU',&DQQRXQFHGWKH',&9LVLRQORQJWHUPPDQDJHPHQWSODQLQWURGXFLQJDUHGH¿QHGYLVLRQVWDWHPHQWDQGDQHZEDVLFSROLF\VHWWLQJIRUWKSULRULW\EXVLQHVVDUHDVDQGRXWOLQLQJNH\VWUDWHJLHV7KHVHLQFOXGHPDNLQJVWUDWHJLFLQYHVWPHQWVHQKDQFLQJRXUWHFKQRORJ\SODWIRUPUHLQIRUFLQJPDQDJHPHQWRIKXPDQFDSLWDOSURPRWLQJ,7DQG';DQGFODULI\LQJVXVWDLQDELOLW\VWUDWHJLHV$GGLWLRQDOO\ZLWKSHRSOHWKHZRUOGRYHUPRUHDQGPRUHDZDUHWKDWWKHHYROXWLRQRIKXPDQLW\GHSHQGVRQUHDOL]LQJD
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comprehensive capabilities.

Value Creation Essentials

General Manager, DIC (China) Co., Ltd.

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Mount Sanqing

DIC Report 2022 ̲34

A Message from the General Manager of the Production Management Unit

We are working to help achieve the goals of
DIC Vision 2030 in the production arena.

Value Creation Strategies

Value Creation Essentials

Naoyoshi Furuta
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General Manager, Production Management Unit

Underpinning Everything: Safe Operations and Quality Assurance
The DIC Group manufactures a wide range of chemicals and related products in 63 countries and territories around the world and provides theseproducts to customers through a global sales network. As its name indicates, the Production Management Unit, of which I am in charge, oversees
the Group’s core manufacturing activities. We place a priority on care for the environment, safety and health through Responsible Care initiatives
and on ensuring compliance with the aim of supporting the operation of safe and secure production sites.
The Production Management Unit is also responsible for supporting production from the perspective of quality control and quality assurance.
We view our mission as being to ensure that the quality of the products we provide meets the requirements of our customers and the market.
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implementing measures to prevent recurrence, we continue working to transform awareness and improve product quality.

Data

Value Creation Cornerstones

The Launch of DIC Vision 2030
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in production grasps the plan’s content and direction and that each individual iscommitted to pressing forward steadily, exerting originality and ingenuity every day,with efforts that will bring the plan’s goals to fruition. To this end, it is important toprovide clear, concrete explanations of key policies and the plan’s main points andpromote the implementation of critical measures. We have already inaugurated anumber of measures. For example, making bold investments with the goal of, among
others, realizing mass production of new products developed in the five priority
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quality requirements, and strengthening human capital by passing down technologies
and providing support for digitalization. To create work environments conducive to
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for “hokoku´ ³UHSRUW´ ³UHQUDNX´ ³LQIRUP´ DQG³sodan´ ³FRQVXOW´ DQG³RKLWDVKL´
for “okoranai´ ³GRQRWJHWDQJU\´ ³hitei shinai´ ³GRQRWQHJDWH´ ³tasukeru´ ³KHOS´ and “shiji´ ³LQVWUXFW´ ²DVZHOODVRQHRQRQHPHHWLQJV,ZDQWHPSOR\HHVWRIHHO
that the production team is helping drive DIC’s efforts to address challenges and at
the same time to feel happy and proud of being part of that team and of contribution
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vegetables steeped in a savory broth .

Climate Change Cannot Wait: Achieving Carbon Neutrality
The Production Management Unit also has a key role to play in meeting DIC’s revised target for the reduction of CO emissions, announced in¿VFDO\HDUZKLFKFDOOVIRUWKH&RPSDQ\WRDFKLHYHFDUERQQHXWUDOLW\E\¿VFDO\HDUDQGUHGXFLQJ&2HPLVVLRQV 6FRSHDQG 
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35̲ DIC Report 2022

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others, shorten production times, stabilize quality, improve equipment operators’ work efficiency and hasten the commercializationof new products, thereby improving productivity and in so doing helping reduce CO HPLVVLRQV,QILVFDO\HDUZHZLOOFRQGXFW
verification testing using a prototype reaction prediction model to determine optimal operating conditions. Ultimately, we aim torealize the practical application of digital technologies that facilitate automation of the entire production process.
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Digitalization of operating status using
high-precision reaction prediction model

AI-based analysis

Use of process informatics todetermine optimal operating conditions

Frontline data

Theoretical model
Literature

Optimization of
production planning
Cooperation
with suppliers

Traceability

y=f(x)
Theoretical data

Raw material data

Operating data

Sampling data

Quality data

Value Creation Essentials

Building Smart Factories and Applying Cutting-Edge Technologies

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Value Creation Cornerstones

investments, Groupwide CO HPLVVLRQVLQ¿VFDO\HDUDWMXVWRYHUWRQQHVZHUHGRZQIURPDSSUR[LPDWHO\
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CO emissions will require more ambitious measures. To this end, in addition to advancing our own environmental investments, we will
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crucial to the Group’s ability to curb its CO  emissions. Together with introducing an internal carbon pricing system, we will formulate and
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Demand prediction

Cyber space
Incorporation of
production data

Distributed control system
Raw materials

Provision of
Manufacturing execution system feedback on optimal
operating conditions

Data

Physical world

Sampling
Testing

Plant A
Procurement

Production: Input of raw materials → Reaction → Postprocessing → Testing

Sales/after-sales service

Optimization of the supply chain

DIC Report 2022 ̲36

A Message from the General Manager of the Technical Management Unit
We are bringing together diverse capabilities and marshaling
the diversity of individuals to realize technologies that
position us to go on the offense.

Kiyotaka Kawashima

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

0DQDJLQJ([HFXWLYH2IÀFHU
General Manager, Technical Management Unit

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ensure the plan’s success, we will work to realize technologies that position us to go on the offense, rather than those that are more defensive
in nature, as well as to promote technological development that capitalizes on our global presence and maximize individual capabilities.

From Adding Depth to Existing Technologies to Pursuing New Technologies
The DIC Group’s ability to add depth to existing basic technologies has led to a wide range of products that contribute to society.
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new basic technologies, as well as technologies that emphasize sustainability or other new criteria. The Group has thus already begun
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existing technologies but also creating and adopting, that is, searching for, brand new technologies. At the same time, through themarketing efforts of our technical departments, we are also seeking to discover new applications and markets for both existing and newtechnologies with the aim of helping customers address current issues and issues not yet acknowledged.

Integrating R&D Functions to Create One Global Lab,QILVFDO\HDUWKH',&*URXSZHOFRPHGDQHZPHPEHUZLWKWKHDFTXLVLWLRQRIWKH&RORUV (IIHFWVEXVLQHVVIURP%$6)IXUWKHUHQKDQFLQJLWVJOREDOEXVLQHVVVWUXFWXUHLQWKHFRORUVSDFNDJLQJDQGJUDSKLFVEXVLQHVVHV',&DQG6XQ&KHPLFDOKDYHORQJFRRSHUDWHG
LQWKHDUHDRI5 'ZKLFKKDVOHGWRDQXPEHURILPSRUWDQWDFKLHYHPHQWV5HFRJQL]LQJWKDWWKHDGGLWLRQRIWKH&RORUV (IIHFWVEXVLQHVVZLOOFUHDWHDVWURQJHUWKUHHFRPSDQ\5 'FRQ¿JXUDWLRQWRXQGHUSLQWKHLPSOHPHQWDWLRQRIWKHVWUDWHJLHVRI',&9LVLRQWKH*URXS
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patent, analysis, AI and marketing functions.

Creating Work Environments for Technical Personnel that Are Conducive to Job Satisfaction
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that consistently motivates people, thereby enabling us to marshal the diversity of individuals. What constitutes such a work environment isa question we will continue seeking to answer going forward. We have already begun to implement the following measures:● Integrate human resources training for DIC and the DIC Group and career paths for individual technical staff;● Respect autonomy, including by establishing rules for allocating a certain number of work hours for technical staff to conduct their own
research and creating a system whereby individuals can propose new research themes anytime and anywhere;● Actively encourage and support individual external activities such as participation in academic conferences and publication of technicalpapers); and● Develop individualized work style care systems that include, among others, counseling and mentoring.

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all employees, including technical staff, and improving work environments.

37̲ DIC Report 2022

A Message from the General Manager of the R&D Management Unit

Our efforts to expand our technology platform are based on
specific aims and targets.

Toshiro Ariga

The Importance of Platform Expansion
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forward with only the technologies we have cultivated in these areas. In light of evolving circumstances, several years ago we began
exploring various new technical themes with the objective of securing new basic technologies, as a result of which we sharpened our
focus to biotechnology, inorganic materials technologies and computational science, e.g., AI and MI.

What We Hope to Accomplish
To provide new value in response to social imperatives such as the need to achieve carbon neutrality and realize a society that is both
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materials technologies and computational science and transform them into DIC Group basic technologies, thereby further expanding ourtechnology platform. This will make it possible for us to provide, for example, new biomaterials that do not depend on petrochemicals
and highly functional materials that could not be achieved using conventional organic raw materials or polymers. In computational
science, AI, MI and simulation technologies will enable us to realize advanced materials design and accelerated development. I am
FRQ¿GHQWWKDWRXUULFKOLQHXSRIEDVLFWHFKQRORJLHVZLOOEHDPDMRUFRPSHWLWLYHDGYDQWDJHIRUWKH',&*URXS

Data

Current Basic Technologies
Biomaterials
designOrganic
materials
designOptics andcolor

Polymer
designInorganic
materials
designBiomaterials
designInorganic
materials
designOptics andcolor

Common basic
technologies

Dispersion

Computational science(AI and MI), Analysis

Dispersion
AI and MI

Applicability
assessment(Coating, printing, molding)

9DOXH&UHDWLRQ6WUDWHJLHV

6LQFHLWVHVWDEOLVKPHQW',&KDVVRXJKWWRVLPXOWDQHRXVO\H[SDQGERWKWKHRSHUDWLRQVDQGWHFKQRORJ\SODWIRUPRIWKH',&*URXS7RGD\RXUEDVLFWHFKQRORJLHVDUHGH¿QHGDVWKRVHLQWKHDUHDVRIRUJDQLFPROHFXODUGHVLJQSRO\PHUGHVLJQGLVSHUVLRQRSWLFVDQGFRORUDQG
applicability assessment.

Value Creation Cornerstones

Our Current Technology Platform

Value Creation Essentials([HFXWLYH2IÀFHU
General Manager, R&D Management Unit

Applicability
assessment

Polymer
designOrganic
materials
design(Coating,
printing,
molding)Using open innovation（including through joint ventures and M&As）

DIC’s rich lineup of basic technologies is
a competitive advantage

DIC Report 2022 ̲38

Special Feature

Helping Realize Sustainable
Mobility Solutions

The DIC Group is working to provide groundbreaking sustainable products thatwill contribute to the improvements in safety and energy-saving technologies
and visual appeal necessary for next-generation mobility.

Color & Display
Functional black pigments that combine outstanding LiDAR signal
response and visual appeal
Spectrasense™ Black EH 8082, Spectrasense™ Black L 0086
and Sicopal® Black L 0095

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

SDGs Goals 9 and 17

The DIC Group has pioneered key NIR-management solutions that will help
automotive coating systems ensure safe, secure and richly colored vehicles.
Value Creation

Leveraging functional pigments to assist autonomous driving and enhance visual appeal

7KHEHQHÀWVDQGGUDZEDFNVRIXVLQJFDUERQEODFNLQDXWRPRWLYHFRDWLQJV
Automakers the world over are focused on developing next-generation mobility
technologies for the smart society of the future that will facilitate autonomous
driving, which will make it possible for anyone and everyone to get around safely
and securely. Leading the charge is light detection and ranging (LiDAR), which
detects the shape and distance of surrounding objects by irradiating them with anear-infrared (NIR) laser and measuring the light reflected back to the system’s
detector, enabling autonomous driving vehicles to “see” where they are going andpreventing them from bumping into or colliding with other vehicles or obstacles.
However, conventional automotive coatings contain carbon black, a material
FRQVLVWLQJRI¿QHFDUERQSDUWLFOHVZKLFKODUJHO\DEVRUEVWKH1,5ZDYHOHQJWKVRI
/L'$5VLJQDOVDQGLQFLGHQWVXQOLJKWFDXVLQJKHDWEXLOGXSDQGVLJQL¿FDQWUHGXFWLRQ
of object detection capabilities.
The obvious question is that if LiDAR object detection capabilities are thepriority, why not just use something other than carbon black? Unfortunately,
it’s not that simple. In addition to providing excellent coverage, carbon blackincreases the durability and conductivity of coatings, making its replacement

ZLWKDQRWKHUPDWHULDOGLI¿FXOW&DUERQEODFNDOVRSOD\VDQLPSRUWDQWUROHLQERG\color, a key consideration for consumers’ decision making when purchasing a
YHKLFOH:LWKRXWXVLQJFDUERQEODFNLWLVGLI¿FXOWWRSURGXFHGDUNFRORUVLQFOXGLQJdeep blacks, greens, blues and reds, or neutral colors such as metallic grays.
Accordingly, automakers have faced a challenge in that the more they emphasize
LiDAR signal response, the less color design freedom they retain.

The NIR wavelengths of LiDAR signals are absorbed by the
carbon black pigment of automotive coatings, significantly
hindering signal response.

Developing a color formulation approach that produces clean, deep colors without hindering LiDAR detection,Q0DUFK&RORUV (IIHFWVWKHSLJPHQWVEXVLQHVVRI*HUPDQ\¶V%$6)RQHRIWKH
world’s leading chemicals manufacturers, succeeded in developing a color formulation
approach that produces clean, deep colors without the use of LiDAR signal–absorbing
FDUERQEODFN &RORUV (IIHFWVZDVDFTXLUHGE\',&LQ-XO\
The conventional automotive coating process involves three key layers: A primer,
which evens out surface irregularities and protects the electrocoat; a color basecoat,39̲ DIC Report 2022

which imparts the main color; and a clearcoat, which seals everything, providing
shine and protection against external elements. It is in the primer and the basecoat
that carbon black, which absorbs NIR wavelengths in LiDAR signals, is typically
XVHG6LPLODUSLJPHQWDWLRQFRQVLGHUDWLRQVFDQEHXVHGLIWKHSDLQWV\VWHPRPLWVWKH
FRQYHQWLRQDOSULPHUDQGLQVWHDGXVHVDFRPELQDWLRQRIWZRPRGL¿HGEDVHFRDWOD\HUVWRIXO¿OOWKHFRPELQHGUROHVRIWKHSULPHUDQGWKHEDVHFRDWThe world continues seeking to address the challenge of delivering convenient, comfortable mobility, recognizing the importance of transportation that is safe,
VHFXUHDQGFDUERQQHXWUDOWRWKHVRFLHW\RIWKHIXWXUH$JDLQVWWKLVEDFNGURSLQ¿VFDO\HDUWKH',&*URXSLQWURGXFHGDYDULHW\RIVXVWDLQDEOHSURGXFWVthat will contribute to the realization of sensing technologies crucial to vehicle safety, as well as help lower energy consumption by reducing vehicle weight.
6XFKSURGXFWVDUHWHVWDPHQWWRWKH*URXS¶VGLVWLQFWLYHSHUVSHFWLYHDQGLQQRYDWLYHWHFKQRORJLFDOFDSDELOLWLHVDVDPDQXIDFWXUHURI¿QHFKHPLFDOV
WEB

https://www.dic-global.com/en/csr/special/

Strong NIR reflection
Weak NIR reflection

Carbon black replaced byfunctional black pigmentsthat facilitate the managementof NIR wavelengths

Clearcoat
Color basecoat(contains variable amounts ofcarbon black dependent on color)

ThicknessȝP
Signal is absorbed
by carbon black

Transformed
into heat

Primer(contains a significant
amount of carbon black)

Electrocoated to protect
vehicle body against corrosion

A Distinctively
DIC Response

Reduced absorption of signal andgeneration of heat
Electrocoated to protect
vehicle body against corrosion

NIR-transparent black pigments (organic)
SpectrasenseTM Black EH 8082
SpectrasenseTM Black L 0086
NIR-reflective black pigment (inorganic)
Sicopal® Black L 0095

Realizing a revolutionary perylene black pigment that improves jetness and enhances neutral colors$QLVVXHWKDWFDQQRWEHUHVROYHGVLPSO\E\UHÁHFWLQJ1,5
7KHLPSHWXVEHKLQG&RORUV (IIHFWV¶HIIRUWVWRGHYHORSDQHZFRORUIRUPXODWLRQDSSURDFK
was a project to develop LiDAR-based positional mapping technologies for use in
DGYDQFHGGULYHUDVVLVWDQFHV\VWHPV $'$6 $PDMRUFKDOOHQJHIRUGHYHORSHUVZDVRI
course the presence of carbon black.
7KHIDFWWKDWFDUERQEODFNDEVRUEVDQGVWRUHV1,5OLJKWLVZHOONQRZQ&RORUV (IIHFWV
had previously developed pigments that reduced the absorption of NIR wavelengths—
thus exerting a heat-shielding effect—for coatings used in building materials for roofs
DQGRXWHUZDOOVDQGHQMR\HGDVLJQL¿FDQWVKDUHRIWKHJOREDOPDUNHWIRUSLJPHQWVXVHG

in coatings for energy-efficient building materials. However, simply applying existing
technologies would not resolve all the issues for automotive coatings. Automakers andcoatings manufacturers alike demanded a coating system that would ensure LiDAR object
detection capabilities while at the same time enabling the creation of dark colors withimproved jetness, as well as metallic grays and other neutral colors. To this end, it wasnecessary to develop a new functional black pigment to replace carbon black that wasalso easy to incorporate into coating systems that take LiDAR transmission, absorption
DQGUHÀHFWLRQLQWRDFFRXQWDQGZDVRSWLPL]HGIRUWKHFRPSRVLWLRQRIDXWRPRWLYHFRDWLQJV

Helping realize innovative coating systems through the optimal combination of pigments that facilitate the management of NIR wavelengths&RORUV (IIHFWVFRPPHQFHGIXOOVFDOHGHYHORSPHQWLQE\WKRURXJKO\DQDO\]LQJ
and evaluating the impact of carbon black on LiDAR signals, including examining thescattering, absorption and reflection of NIR light and performing colorimetric assays.
Narrowing its focus to perylene black, an organic compound that possesses multiple
hues, the company developed Spectrasense%ODFN(+DQLQQRYDWLYHSHU\OHQH
black pigment that improves transmission of the NIR wavelengths in LiDAR signals andenhances jetness by absorbing visible light better than other NIR management black
SLJPHQWVRQWKHPDUNHW%\XVLQJWKLVQHZQHXWUDOFRORUHGEODFNSLJPHQWLQFRPELQDWLRQZLWKRWKHU1,5UHÀHFWLYHRUQRQDEVRUELQJSLJPHQWVIRUPXODWLRQVZHUHFUHDWHGIRUWKH
SULPHUDQGEDVHFRDWOD\HUVZKLFKQRWRQO\SURYLGHGH[FHOOHQW/L'$5UHÀHFWLYLW\EXWDOVR
allowed desirable colors from the whole color palette to be formulated. Due to the neutral
color and high jetness of SpectrasenseTM %ODFN(+IRUWKH¿UVWWLPHQHXWUDOJUD\and black colors were achievable simply by use of the black pigment in combination withother reduction pigments. No additional tinting or adjustment is needed unless a color
shift is required to achieve the design color.

&RPSOHWHGLQ0DUFKWKHQHZLPSURYHG1,5WUDQVSDUHQWEODFNSLJPHQW
Spectrasense%ODFN(+LPPHGLDWHO\HDUQHGDFFODLPIURPERWKFRDWLQJV
manufacturers and automakers, for the potential it offers in eliminating dependence on
carbon black pigments and opening the way to the realization of a smart society.
',&¶VGHFLVLRQWRDFTXLUHWKH&RORUV (IIHFWVEXVLQHVVDEXVLQHVVSDUWQHURIZKROO\RZQHG86VXEVLGLDU\6XQ&KHPLFDO&RUSRUDWLRQZDVSURPSWHGE\WKH*HUPDQ
company’s advanced pigment development technologies and experience as a key
supplier to all the leading global automotive coatings manufacturers, both of which it
believes are essential to the realization of the targets it has set, which are outlined under
LWV',&9LVLRQORQJWHUPPDQDJHPHQWSODQ )RUPRUHLQIRUPDWLRQRQ',&9LVLRQSOHDVHVHHSDJH $VWKLVQHZFRORUIRUPXODWLRQDSSURDFKVKRZVWKHDFTXLVLWLRQ
has already proved highly fruitful.

DIC Report 2022 ̲40

Value Creation Essentials

LiDAR signal (NIR light)

LiDAR signal (NIR light)

Value Creation Strategies

New coating system with functional black pigments that facilitate
the management of NIR wavelengths (does not contain carbon black)

Value Creation Cornerstones

Conventional three-layer coating system(contains carbon black)

DOORZHG/L'$5VLJQDOVWRSHQHWUDWHWKURXJKDQGUHÀHFWEDFNLQVWHDGRIEHLQJDEVRUEHG
while at the same time achieving the depth of color needed for high-end vehicles.
This new color formulation approach makes it possible for manufacturers of coatings
for autonomous driving vehicles, which will be indispensable to the smart society of the
future, to break free from dependence on carbon black and deliver both outstanding
sensing performance and visual appeal.
%HFDXVHWKLVDSSURDFKLVVXLWDEOHQRWRQO\IRU
automobiles but also for a variety of industrial
products where sensors are used, potential
applications span multiple scenarios.

Data

&RORUV (IIHFWVVRXJKWWRDGGUHVVWKHSUREOHPRIFDUERQEODFNDVDSLJPHQWLQ
coatings for autonomous driving vehicles by embarking on the development of color
formulations that enable the management of NIR wavelengths in automotive coatings
by using a primer and a basecoat containing NIR-transparent and NIR-reflectivefunctional black pigments that selectively transmit and reflect back NIR wavelengths
ZKLOHHQVXULQJWKHKLJKSHUIRUPDQFHUHTXLUHGIRUHDFKFRDWLQJOD\HU%\XVLQJ1,5
functional pigments as replacement for carbon black—NIR-transparent black pigmentsfrom the Spectrasense%ODFNSURGXFWUDQJH WKHQHZSpectrasense%ODFN(+8082SpectrasenseDQG%ODFN/ RUDQ1,5UHIOHFWLYHEODFNSLJPHQWIURPWKH
Sicopal ®%ODFNSURGXFWUDQJH Sicopal ®%ODFN/ ²IRUPXODWLRQVZHUHFUHDWHGZKLFKMessage

The reaction from automakers and the coatings industry has been tremendous!

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials'HYHORSPHQWRIDTXDQWLWDWLYHPHDVXULQJPHWKRGWKURXJKPRGLÀFDWLRQRID899LV1,5VSHFWURSKRWRPHWHU&RORUV (IIHFWVKDGH[SHULHQFHGHDOLQJZLWKKHDWPDQDJHPHQWDSSOLFDWLRQVWKURXJKWKHGHYHORSPHQWRISLJPHQWVZLWKheat-shielding functions. Nonetheless, undertaking a project to develop pigments for automotive coatings compatible withautonomous driving systems that would both enhance LiDAR signal responsiveness and improve dark and neutral colors wasa major challenge.
In the initial phase of this project, the focus was to understand how LiDAR signals behaved at various angles of incidence
when encountering a coating stack comprising three layers formulated with functional pigments. The tools needed to makesuch measurements were not readily available for experiments under reproducible lab conditions, so assistance was soughtfrom a leading equipment manufacturer. With this company’s help, modifications were made to a commercial ultraviolet–
YLVLEOH1,5 899LV1,5 VSHFWURSKRWRPHWHUHQDEOLQJPHDVXUHPHQWVWREHPDGHDFURVVD±QPZDYHOHQJWKUDQJH
while varying the incidence angle of the measured sample. This allowed comparative measurements of coated objects, todetermine the degree to which carbon black negatively affects LiDAR signal response at different incidence angles and how
much this improves with NIR-transparent black pigments, the outcome of which played a key role in subsequent pigment
development efforts.

7KHGLIÀFXOW\RISURGXFLQJQHXWUDOPHWDOOLFJUD\V
2QHRIWKHPRVWGLI¿FXOWWDVNVZKHQXVLQJDOWHUQDWLYHSLJPHQWV²LQFOXGLQJH[LVWLQJFRPPHUFLDONIR-transparent black pigments from the Spectrasense%ODFNUDQJH²DVUHSODFHPHQWIRU
carbon black was to facilitate the production of neutral metallic grays. When combining existingSpectrasense%ODFNSURGXFWVZLWKQHXWUDOSLJPHQWVVXFKDVWLWDQLXPGLR[LGHVLOYHUPLFDDQG
aluminum, the color shifts into the green or reddish-blue color space, requiring the addition ofother color pigments to counter the undesired undertone.
To overcome this issue, information available in related literature was combined with internal
expertise to develop a method for controlling the crystal structure of the perylene, thereby
controlling the pigment color. This enabled the development of a new perylene black that
SURGXFHVQHXWUDOFRORUVLQSLJPHQWUHGXFWLRQVDQGIXO¿OOVWKH1,5WUDQVSDUHQF\UHTXLUHPHQWV
for LiDAR-detectable color formulations at all viewing angles. Importantly, the approach was
effective not only in the laboratory but also when scaled up to commercial production level. ThisEUHDNWKURXJKPDNHVLWSRVVLEOHWRDFKLHYH1,5UHÀHFWLYHQHXWUDOPHWDOOLFJUD\V VROLGDQGHIIHFWshades) without the need for color correction with another pigments.

*OREDO,QQRYDWLRQ0DQDJHU±
Organic Pigments,&RORU0DWHULDOV
6XQ&KHPLFDO&RUSRUDWLRQ

Dr. Paul Brown

LiDAR Signal Response: Carbon Black vs. Functional Black Pigments

New perylene black&RPPHUFLDO
perylene black&DUERQEODFN

Commercialization and production during a global pandemic
7HFKQRORJLFDOGHYHORSPHQWKDGSURJUHVVHGFRQVLGHUDEO\EHIRUH&29,'VSUHDGWR(XURSHDQGE\WKHWLPHLWZDVGHFODUHGDSDQGHPLFGHYHORSPHQWZDVDOUHDG\DWWKHVWDJHZKHUHDGYDQFHGSURWRW\SHVZHUHEHLQJVDPSOHGWRPDMRUFXVWRPHUVZLWKZKRPDFWLYHQRQGLVFORVXUHDJUHHPHQWVZHUHLQSODFH*LYHQWKH
JOREDOVLWXDWLRQKRZHYHUVLJQL¿FDQWFKDOOHQJHVUHPDLQHGLQ¿QGLQJDQHIIHFWLYHZD\WRREWDLQGHWDLOHGIHHGEDFNRQWKHWHVWLQJRIWKHSURWRW\SHVVRWKDWDQ\¿QDO
adjustments could be made to the pigment prior to commercialization in 2021.
Under normal circumstances, face-to-face meetings with customers, and with pertinent in-house groups, would have taken place. However, given the pandemic
all communications had to be conducted via online meetings. In general, limited experience existed in conducting in-depth discussions remotely, but despite some
initial frustrations, effective communication was achieved, resulting in successful completion of the project and the subsequent launch in the market in 2021.
(YHU\RQHLQYROYHGLQWKHGHYHORSPHQWFRPPHUFLDOL]DWLRQDQGSURGXFWLRQRIWKHQHZSLJPHQWDVZHOODVRXUFXVWRPHUVGHVHUYHVDELJWKDQN\RX(DUQLQJWKHEHVWSUHVHQWDWLRQDZDUGDWWKH)2&86FRQIHUHQFH
7KH'HWURLW6RFLHW\RI&RDWLQJV7HFKQRORJ\ '6&7 KROGVDQDQQXDO)XWXUHRI&RDWLQJV8QGHU6WXG\ )2&86 FRQIHUHQFHIRUWKHGLVFXVVLRQRIQRWDEOH
themes and urgent issues. This event is attended by original and contracted coatings manufacturers from around the world, as well as by leading global
DXWRPDNHUV0RUHWKDQSHRSOHWRRNSDUWLQWKH0D\FRQIHUHQFHZKLFKZDVKHOGUHPRWHO\WRFXUEWKHVSUHDGRI&29,''XULQJWKHFRQIHUHQFH&RORUV (IIHFWVJDYHDSUHVHQWDWLRQRQWKHUHÀHFWLYLW\RIFRDWLQJVDQG/L'$5GHWHFWLRQGXULQJZKLFKLWGHWDLOHGLWVVXFFHVVLQUHDOL]LQJDPHWKRGIRU
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GHOLYHUHGLQWKHSUHVHQWDWLRQZHUHZHOOUHFHLYHGE\WKHRUJDQL]LQJFRPPLWWHHDQG&RORUV (IIHFWVZDVSOHDVHGWRUHFHLYHWKHEHVWSUHVHQWDWLRQDZDUG
7KHH[WUHPHO\SRVLWLYHUHVSRQVHWRRXU)2&86SUHVHQWDWLRQFRQ¿UPVWKDW&RORUV (IIHFWV¶SLJPHQWVWHFKQRORJLHVDUHVHHQDVOHDGHUVLQWKHDUHDRISLJPHQWVIRU/L'$5GHWHFWDEOHFRORUV)XUWKHU5 'ZLOOFRQWLQXHLQWKLVDUHDZLWKWKHDLPRIFRQWULEXWLQJWRLQFUHDVHGGHVLJQIUHHGRP

41̲ DIC Report 2022

KEY PERSON from DIC

This new pigment yields a true black and offers great potential.

:KHQWKHGHYHORSPHQWSHUVRQQHO¿UVWVKRZHGPHDSDQHOFRDWHGZLWKWKHSURWRW\SHSLJPHQW,ZDVUHDOO\H[FLWHGDQGUHFRJQL]HGWKDWLWKDG
the potential to become a massively important new product. We have introduced perylene black to manufacturers of automobile coatings
many times in the past, but have not been able to break into the area of color creation for automobiles, which requires the production of
FOHDQGHHSFRORUVZLWKDFRDWLQJWKLFNQHVVRIRQO\ȝP7KHUHDFWLRQIURPFXVWRPHUVKDVDOZD\VEHHQWKHVDPH³,WORRNVEODFNEXWLW¶VQRW
a true black.”
We have received many favorable and encouraging comments in response to samples of Spectrasense%ODFN(+DQGWKHSK\VLFDOFKDUDFWHULVWLFVRIFRDWLQJVFRQWDLQLQJWKHQHZSLJPHQWKDYHDOVRHDUQHGSRVLWLYHUHYLHZV5HFHQWO\VWULFWHUHQHUJ\HI¿FLHQF\VWDQGDUGVIRU
automobiles have prompted demand for pigments with heat-management capabilities, underscoring our belief in our ability to grow this new
business without waiting for the full-scale arrival of autonomous driving. This is a new functional pigment that enables the creation of a true
EODFNFRDWLQJDQG,FDQIHHOFRQ¿GHQWLQUHFRPPHQGLQJIRUDZLGHUDQJHRIDSSOLFDWLRQVThe potential for pigments that can replace carbon black is unlimited.

To improve the safety of autonomous driving vehicles, it is essential to ensure that vehicles are able to detect things around themthat they could possibly run into, from the clothes worn by pedestrians to bicycles, walls and construction cones. Many such objects
feature colorants containing carbon black. In all of these cases, we need to replace carbon black with functional pigments that do
QRWLQWHUIHUHZLWKDQDXWRQRPRXVGULYLQJYHKLFOHV¶DELOLW\WRGHWHFW/L'$5VLJQDOV7KHSRWHQWLDODSSOLFDWLRQVIRU&RORUV (IIHFWV¶
functional black pigments really are innumerable. Moreover, carbon black absorbs NIR light in incident sunlight, causing heat buildup, so we also expect heat-management applications for these pigments to expand further.

KEY PERSON from DIC

Andre Bendo
Value Creation Strategies

Technical Industry Manager–Automotive, Sun Chemical Corporation

7KLVLVDQRWKHUJUHDWH[DPSOHRIKRZZHDGYDQFHWHFKQLFDODQGVFLHQWLÀFH[SHUWLVH

7KHLQÀXHQFHRIFRORUSLJPHQWVRQFRDWLQJVLVQRWUHVWULFWHGVROHO\WRWKHYLVXDOUHJLPH'HVSLWHWKHQDPHWKH\DOVRLPSDFWSURSHUWLHVapart from color, defined in regions hidden to the human eye. One of these regions is NIR, which is relevant to both solar heat
PDQDJHPHQWDQG/L'$5&RQWURORYHUWKHDGYDQFHGSURSHUWLHVRISLJPHQWVLVDNH\FKDUDFWHULVWLFXQGHUVFRULQJRXUSRVLWLRQDVRQH
of the largest pigment producers and a global leader at the forefront of technological understanding and research. Our expertise led
to the recent development of an outstanding functional black pigment, offering a multitude of possible usages by enabling targetedtuning of the NIR behavior of coatings. The new Spectrasense%ODFN(+SLJPHQWLVDFOHDUGHPRQVWUDWLRQRIRXUGHHS
knowledge of pigment chemistry and physics, as well as our highly skilled engineering capabilities.
Team Leader, Colorimetry & Pigment Physics, Color Materials, Sun Chemical Corporation

KEY PERSON from DIC

Dr. Max Mussotter

Value Creation Cornerstones

KEY PERSON from DIC

Shintaro Gomyo

Value Creation Essentials

Manager, Pigment Global Operation Strategy Planning Group, Color Material Products Division, Osaka Branch, DIC Corporation

Bringing together the know-how, technologies and sales channels of threecompanies is key to expanding sales of sustainable products.
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The new functional black pigments featured herein represent a pioneering sensing-related application for pigments that have
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color materials through our global sales channels, but also continue to expand our product portfolio of products that contribute to
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Manager, Color & Display Business Planning Department, DIC Corporation

Mineo Yoda

DIC Report 2022 ̲42

Functional Products:RUOG·VIDVWHVWFXULQJFDUERQÀEHU²UHLQIRUFHGSUHSUHJDICARBO ® LF series

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The DIC Group has developed a revolutionary method for producing CFRP—
essential to lowering the weight and increasing the durability of vehicles—that
VLJQLÀFDQWO\UHGXFHV&22 emissions and energy consumption attributable toproduction.
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Production processes that hinder the broad adoption of CFRP, a superior composite material$VLWVQDPHLQGLFDWHVFDUERQILEHU±UHLQIRUFHGSODVWLF &)53 LVDILEHUUHLQIRUFHGFRPSRVLWHPDWHULDOFRQWDLQLQJFDUERQ¿EHUVUHLQIRUFHGZLWKUHVLQ
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buildings, bridges, satellites and wind power generating equipment. In themobility field, in particular, with fuel efficiency a key theme as the world
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functional material that helps reduce vehicle weight.

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reinforced sheet-form intermediate material made by spreading bundlesof carbon fibers (tows) to create flat sheets and impregnating the sheets
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prepreg sheet—made with epoxy resin—must be refrigerated or frozen forstorage and thawed for use, as a result of which this has traditionally been a
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Figure 1: Carbon Fiber–Reinforced Prepreg Sheet
An intermediate material made by spreading carbon fiber tows to create flat sheets and impregnating the sheets with resin

Spread of tow
Carbon fibers

43̲ DIC Report 2022

Heat-curable resin

Impregnation with resin

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Remove CFRP from mold

PRESS

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sec
14 0 °C

PRESS

This is thanks to
DICARBO ® LF!

Collect prepreg from storage spaceand proceed to processing(no need to thaw!)

A Distinctively
DIC Response

60This is thanks to DICARBO ® LF!

Cut

Layer

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Remove CFRP from mold

Developing a radical curing resin that delivers both high-speed curing and normal temperature stability

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experience in the area of molding resins, a number of breakthroughs werenecessary to realize a resin conducive to spreading and loosening carbon¿EHUEXQGOHVLQWRVLQJOHWDSHVWKDWDUHWKHQDUUDQJHGHYHQO\LQWRWKLQVKHHWV',&¶VWHFKQLFDOVWDIIEHJDQE\VHOHFWLQJVHYHUDOIDVWFXULQJFDQGLGDWHUHVLQVit saw as having the potential to boost productivity, but found determining adesign and formulation that allowed changes in curing status depending on
the process extremely challenging. They realized that what they needed todevelop was a resin that reaches a semi-cured state during the process of
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when heated. In other words, a resin that would reach optimum viscosity
during each process, i.e., coating, impregnation, winding, storage andcompression molding. Design and formulation was further complicated by theneed to ensure the resin could be stored at room temperature, rather thanrequiring refrigeration or freezing.
To address these issues, technical staff analyzed changes in physicalproperties caused by viscosity and resin temperature required at eachstage and pressed ahead with polymer design while conducting repeated
VLPXODWLRQV$WWKHVDPHWLPH',&¶V6DNDL3ODQWZKHUHWKH&RPSDQ\conducts resin development, produced multiple prototype resins in a processof trial-and-error to realize the precise resin characteristics as designed. These
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UHSHDWHGDGGLWLRQDOUH¿QHPHQWVDQGDGMXVWPHQWVZHUHPDGHDIC Report 2022 ̲44

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of specialty and cooperated closely to integrate new technologies. In
summer 2021, they succeeded in the practical development of a fast-curing
prepreg sheet that boasts the world’s fastest curing time and can be stored
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for storage and then subsequently thaw for use, productivity is improved by
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resin for prepreg, leveraging its polymer design technologies, and launcheda research project aimed at commercializing fast-curing prepreg sheets
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which boasts high-precision impregnation technologies that capitalize on
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aiming at commercialization for automotive applications within three years.

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Through repeated trial production and constant modification, the project
partners succeeded in gradually improving resin characteristics. They also
incorporated an original idea into the impregnating process that greatly
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development deadline looming, the partners completed fast-curing carbon
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fastest curing time but can also be stored at room temperature and iscompatible with a wide range of molding methods. The three entities
subsequently developed a mass production process for this innovative
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2021. The product was well received across a broad range of industries

and the department in charge was busy for weeks responding to inquiries.
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has a mission to promote DICARBO ®/)DVDUHSODFHPHQWIRUFRQYHQWLRQDOFDUERQ¿EHU±UHLQIRUFHGSUHSUHJVDQGWRHQFRXUDJHLWVDGRSWLRQWRIDFLOLWDWH
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that the increasing use of DICARBO ®/)ZLOOIXUWKHUDGYDQFHWKHSRSXODULW\RI
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Outer surface of DICARBO ® LF
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Example 2 Double belt press molding

Example 3 Autoclaved molding

Example 4 Sheet winding molding

Performance Comparison of DICARBO ® LF and Other Carbon Fiber–Reinforced Prepregs
Data

DICARBO ® LF

Conventional prepregs (heat-cured)

Conventional prepregs (thermoplastic)

3

2

1

0
Ease of storage45̲ DIC Report 2022

Suitability forlong-term storage

Production efficiency

Strength

Energy savings(during production)

KEY PERSON from DIC

Six years its proposal, we were able to overcome the biggest obstacle and achievecommercialization.

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truly pleased when the work of so many colleagues to make improvements enabled us to begin providing samples in 2021.
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Tomoaki Shinchi

Value Creation Essentials

We are striving to encourage the widespread adoption of CFRP by focusing on reducing
energy consumption attributable to production.

The response to our news releases, as well as to our participation in exhibitions and digital marketing efforts, has been immense fromboth the domestic and overseas markets. In addition to mobility, we are promoting sales to sports equipment, electronics and electrical
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easy for us to encourage companies to switch from conventional products to DICARBO ®/)EXWRXUFXVWRPHUVKDYHJHQHUDOO\EHHQLQWHUHVWHG
in saving energy so this is the angle we have used to propose this product.
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products and we will provide whatever support we can by leveraging the technologies and personal connections we have cultivated in the
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Naoko Nakajima

Value Creation Cornerstones

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I look forward to this achievement leading to the realization of new molded products
made with CFRP.
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In terms of the resin’s behavior, obtaining stable, high-quality prepreg sheets was a challenge, but the
researchers involved in the project were tenacious and positive and succeeded in achieving commercialization.
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General Manager,
New Industrial Creation R&D Department,
Industrial Technology Center of Fukui Prefecture

Kazumasa Kawabe

DIC Report 2022 ̲46

Data

KEY PERSON from DIC

Value Creation Strategies

0DQDJHU$3URMHFW$XWRPRWLYH%XVLQHVV8QLW6DNDL3ODQW',&&RUSRUDWLRQContributing to the Realization of a Circular Economy

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials| Social Imperatives and a Circular Economy
Population expansion and economic growth, together with an improvement in living standards are, heightening issues such as resource depletion andmarine plastics. As a result, awareness of the importance of realizing a circular economy is rising, as is the need to establish business models that do notdepend on the consumption of resources.
Since the Basic Act on Establishing a Sound Material-Cycle Society came into force in 2000, Japan has taken decisive steps to decrease the volume ofwaste disposed of and increase the waste recycling rate. In particular, the Act emphasizes minimizing environmental impact by curbing waste generated,
as well as by promoting the recycling of underground resources in discarded waste, thereby lowering consumption of such resources.
Worldwide, awareness of the need to reconsider the excesses of capitalism and reevaluate modern society’s mass production, mass consumption
paradigm has increased rapidly in recent years. This has heightened the urgency of shifting to a new system whereby waste is eliminated and resources are
circulated.
In response, in 2019 Japan formulated the Resource Circulation Strategy for Plastics and announced milestone targets for 2030. Under this strategy,
VSHFL¿FHIIRUWVIURP$SULOZLOOIRFXVRQWKHXVHRISODVWLFPDWHULDOV7RGDWHDZLGHUDQJHRIHQWLWLHVKDYHHQIRUFHGWKH$FWRQ3URPRWLRQRI5HVRXUFHCirculation for Plastics at all stages, from product design through to disposal, to promote the recycling of plastics.
In 2020, the European Commission announced the European Green Deal, an European Union-wide economic growth agenda. The concurrently
formulated Circular Economy Action Plan—a major building block of the deal, for which a new package of measures was recently introduced—seeks torealize an EU that is more competitive, as well as cleaner, and to advance job creation. This has accelerated efforts to reduce resource consumption andpromote decarbonized businesses and spurred efforts by individual EU member countries to put forward related legislation.
Against this backdrop, the DIC Group, a leading global presence in the food packaging market, views advancing efforts to respond to a circular economy
as one of its key sustainability strategies, as set forth in the new DIC Vision 2030 long-term management plan. Looking ahead, the Group will step up
efforts to develop and implement concrete plans for implementing this strategy.

| Grasping and Reducing Environmental Impact from the Perspective of Product Life Cycles
Effective resource recycling demands an approach that takes into account the entire life cycle of products. For the DIC Group, this means understanding
the environmental implications not only of its own business activities but also that of all parties across the supply chain, including suppliers, customers,
consumers and recycling companies. Accordingly, the Group is working to grasp the impact of its products from the perspective of product life cycle,
advancing initiatives with a focus on the “5Rs” (Reuse, Reduce, Recycle, Redesign and Reduce CO2*), as well as acting to curtail waste discharged fromSURGXFWLRQIDFLOLWLHVDQGRI¿FHVDQGJXDUDQWHHHQYLURQPHQWIULHQGO\SURFXUHPHQWSUDFWLFHVZLWKWKHREMHFWLYHRIUHGXFLQJWRWDOHQYLURQPHQWDOLPSDFW*URXSFRPSDQ\6XQ&KHPLFDOGH¿QHVWKH¿IWK³5´DV³5HQHZ´7KH',&*URXSDVDZKROHXVHVWKHEURDGHU³5HGXFH&2 2 .”| Designing Products with Consideration for a Circular Economy
Economic rationality is indispensable to the effective promotion of resource recycling. Rather than treating end-of-life products as waste, it is crucial
to take various steps to ensure they are recognized once again as having value. For this reason, manufacturers must endeavor to provide recyclable
products at the lowest possible cost, while buyers must be willing to pay a fair price. The DIC Group is incorporating the 5Rs from the product design
stage by expanding use of biomass, prolonging useful product life, shifting to mono-materials and emphasizing recyclability. By partnering with customers
and recycling companies, the Group is also striving to ensure economically rational product life cycles, including by improving the quality of recycledresources and minimizing costs associated with reuse and recycling, and to build business models with a low environmental impact.

| Collaboration with Stakeholders
Working with partners is essential to reduce the environmental impact of DIC Group products. At the procurement stage, cooperating with suppliers
makes it possible to reduce CO2 emissions and consumption of terrestrial resources, as well as to source low environmental impact raw materials. When
products and services are used, it is important to discuss needs with customers and encourage them to choose products that are both economical andhave a low environmental impact. To this end, it is necessary to convey information on products in an easy-to-understand manner and join forces withcustomers to analyze and improve the environmental impact of their operations. It is also critical to encourage national and industry associations to create
standards and incentives that take into account the need to lower environmental impact. By thus collaborating with stakeholders, the DIC Group strives toreduce both its own and society’s impact on the environment.

47̲ DIC Report 2022

DIC’s Efforts to Drive the Realizationand Expansion of a Circular Economy

Design

DIC will continue to promote the realization andexpansion of a circular economy through its
businesses by monitoring developments frommedium- to long-term perspectives.

“5R”* technologies and development efforts
that advance the circular use of resources* Reuse, Reduce, Recycle, Redesign and Reduce CO₂

Scope 1 and 2
Reduction/recycling of waste “Zero emissions” initiatives

Customer

Recycling
Materials procured throughsustainable supply chains

Realization of chemical
and materials recycling

Resource recycling governanceUse of digital infrastructure

The DIC Group’s Obligations
Reduce industrial waste and advance the recycling and reuse of materials by promoting “zero emissions” initiatives

Reduce industrial waste(For more information,please see page 66.)

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companies work actively to recycle cinders, dust and sludge, among others, into roadbed materials and raw materials for cement, use thermal recycling to recover waste heatand minimize production losses by increasing throughput yields.
Overseas, DIC Group companies strive to ensure the disposal of industrial waste in a manner that complies with national and regional legal and regulatory requirements,
as well as to minimize industrial waste through the voluntary recycling and reuse of materials. Going forward, the Group will also seek to implement common global initiatives.
Promote the conservation and effective use of water resources

Manage water resources(For more information,please see page 66.)

With population and economic growth bolstering living standards around the world, global demand for water is expected to rise further going forward, as a result of which areas
experiencing water shortages are likely to expand. The DIC Group sees water as essential to its manufacturing processes, that is, to heating and cooling, washing, chemical
removal and wastewater drainage facilities. Accordingly, the Group recognizes the management of water resources to be a crucial social imperative and promotes various
LQLWLDWLYHVGHVLJQHGWRHQVXUHHI¿FLHQWZDWHUXVHDQGDSSURSULDWHWUHDWPHQWRIZDVWHZDWHUDVZHOODVWRDVVHVVZDWHUULVNVDWLWVSURGXFWLRQVLWHVDURXQGWKHZRUOGWKHUHE\reducing its environmental impact.

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principal chemicals manufacturers and associations. JaIME recognizes that marine plastics is an issue that the chemicals industry should take the lead in addressing inaccordance with the spirit of Responsible Care. The DIC Group participates and makes proposals regarding a variety of JaIME initiatives, including arranging and disseminating
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Promote initiatives acrossthe value chain

Japan Clean Ocean Material Alliance
In line with the CLOMA Vision, which calls for the building of a platform for accelerating innovation aimed at resolving the issue of marine plastics, the Japan Clean Ocean
Material Alliance (CLOMA) is fostering the development of “Japan model” technologies that will decrease such plastics through business matching, as well as supporting
the propagation of such technologies in Southeast Asia. The DIC Group has achieved noteworthy results through business matching, collaborating with a customer tocommercialize a chemical recycling technology for polystyrene.

Circular Economy for Flexible Packaging&LUFXODU(FRQRP\IRU)OH[LEOH3DFNDJLQJ &()/(; LVDFROODERUDWLYH(XURSHDQFRQVRUWLXPRIFRPSDQLHVDVVRFLDWLRQVDQGRUJDQL]DWLRQVUHSUHVHQWLQJWKHHQWLUHÀH[LEOH
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circular economy for this sector. Through the participation of Group company Sun Chemical, the DIC Group will work to ensure a grasp of information and trends pertaining toEuropean collection and sorting systems and regulations, increasingly a subject of debate, with the goal of contributing to the realization of a circular economy.

DIC Report 2022 ̲48

Value Creation Strategies

Supplier

Scope 3 Category 12
Increase recycling rate
Reduce disposal of
used products

Value Creation Cornerstones

Sale

Data

Scope 3 Category 1
Increase procurement rate forrecycled raw materials andProcurement
bioderived raw materials

Value Creation Essentials

Production

Work Style Reforms: Activities of the WSR 2020 Committee
Message from the Executive Vice President
With efforts to respond to the protracted COVID-19 pandemic, as well as to measures aimed at tackling climate change
by realizing carbon neutrality and at ensuring the achievement of the SDGs, increasingly required at the national,
regional and corporate levels, the roles that companies are expected to play are undergoing major changes.
:LWKWKHDLPRIDGGUHVVLQJVXFKNH\VRFLDOLPSHUDWLYHVWKH',&*URXSKDVDQQRXQFHGDUHGH¿QHGYLVLRQVWDWHPHQW²³:HLPSURYHWKHKXPDQFRQGLWLRQE\VDIHO\GHOLYHULQJFRORUDQGFRPIRUWIRUVXVWDLQDEOHSURVSHULW\²Color & Comfort´²
and a new long-term management plan, DIC Vision 2030.
7RIXO¿OOWKHSURPLVHRIRXUUHGH¿QHGYLVLRQVWDWHPHQWLWLVFUXFLDOWKDWWKHHPSOR\HHVUHVSRQVLEOHIRUGULYLQJWKH*URXS
Value Creation Essentials

forward share our vision for the future and work as one to help us evolve as a corporate group that contributes to therealization of a healthy global environment and a sustainable society. To this end, it is essential that we maximize theadded value the Group provides by ensuring each and every employee enjoys job satisfaction and is able to reach theirfull potential. These are the objectives of the Work Style Revolution (WSR) 2020 Committee.
With the aim of achieving the goals of DIC Vision 2030, the Group will further strengthen necessary investments in its
human capital, that is, each and every one of its employees, which it recognizes as its most important resource.
Executive Vice President,

Data

Value Creation Cornerstones

Value Creation Strategies

Toshifumi Tamaki Chairman, WSR 2020 Committee| WSR 2020
Fiscal year 2020 marked a major turning point in the DIC Group’s exploration of potential new work styles. Positioning the year as theinaugural year of reforms, the Group launched WSR 2020 as a project targeting the development of unique new work styles to enhance
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but also working to enhance the awareness and conduct of individual frontline employees.
With the aim of fostering diverse employees who are both motivated and productive, the WSR 2020 project was structured around three
central themes: Job satisfaction improvement reforms, workplace reforms and process reforms. These three themes and related initiatives
are described below.

| Job Satisfaction Improvement Reforms
The ideal DIC Group workplace is one that embodies The DIC Way by encouraging enthusiasm about taking on various challenges,
evaluating performance fairly and recognizing personal value. The Group is promoting various reforms to improve job satisfaction in linewith key themes: Create work environments that empower employees to reach their full potential, appropriately evaluate employees fortaking on challenges and for achievements, and create a system that rewards them to the maximum degree possible; and support careerdevelopment for individual employees based on a performance-oriented approach. Human capital management, as outlined in DIC Vision
2030, emphasizes the fact that a company’s key players are its employees. DIC will continue to roll out measures that support the activitiesof each of its key players and inspire job satisfaction.
Reforms to Improve Job Satisfaction (Beginning in Fiscal Year 2022)
Theme

Outline

Details

Diversity

Pursue diversity by employing a broad spectrum of individuals without
regard to such considerations as age, nationality or gender, maintaining
awareness of the importance of inclusion and mutual respect.

In addition to ongoing initiatives to promote career opportunities for
women and the hiring of foreign nationals, in fiscal year 2022 DIC will
begin implementing initiatives aimed at uncovering individual strengths
and talents, foster a corporate culture that emphasizes mutual respectand enhance teamwork.

Inner branding

Nurture a sense of unity and bolster job satisfaction bycommunicating information on distinctively DIC employee conductthat complies with The DIC Way in an easy-to-understand manner.

Through the dissemination of more in-depth everyday information on, forexample, employee activities and internal systems, DIC is working to raiseawareness of what makes DIC unique and to evoke a shared sense of being
part of the DIC family that motivates employees to act on their own initiative.

49̲ DIC Report 2022

Outline

Details

Communication

Focus on communication between superiors and subordinates,
demonstrating that empathy can lead to compromise and how
effective methods of communicating can enhance job satisfaction.

Provide training and coaching on one-on-one communication.

Career support

Provide employees with opportunities to design their own careers,
thereby boosting both professional skills and job satisfaction.

Introduce “self-career dock” training and make use of external
career counselors.

Annual surveys to gauge senseof belonging

Enhance the visibility of and quantify employees’ enthusiasm fortheir work and use this information to promote various internalorganizational development efforts.

Conduct an employee engagement survey, analyze results andimplement measures to lift employee enthusiasm.

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remuneration and evaluation
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year 2022)(QVXUHWKHDYDLODELOLW\RIPXOWLSOHFDUHHUSDWKVWKDWDFFRPPRGDWHDZLGHUDQJHRIGXWLHVDQGUROHVWKHUHE\FUHDWLQJTXDOL¿FDWLRQEDVHG
systems that are similar to a job-oriented system.

Value Creation Essentials

Theme

Value Creation Strategies

VOICE We work to communicate the attractiveness of DIC to improve employee motivation.
As part of our inner branding initiative, we are disseminating information internally under the heading “DIC Value: Better Understanding the Company’s
Personnel and Employee Welfare Systems.” DIC has earned positive evaluations for its human resources and sustainability frameworks from a variety ofassessment organizations. However, looking internally there were fears that DIC’s appeal was not being communicated adequately. Our goal is thus to provide
a range of useful information to employees that will further enhance their appreciation of and affection for the Company. The topic that has received thegreatest response to date was a special feature on childcare leave programs for male employees. In addition to introducing leave programs, we included actualcomments from employees who have made use of these programs and their partners, which I think employees empathized with.

increasing job satisfaction for all of my colleagues.
HR Group, General Aﬀairs and HR Department

Kaori Kanbayashi| Workplace Reforms
To accommodate the rapidly expanding use of telework arrangements as a result of COVID-19, the DIC Group has taken steps to build an
infrastructure, including networks and security devices, to ensure safety and productivity. The Group will continue working to reinforce thisinfrastructure to help individuals and departments/divisions and to improve employees’ practical skills in leveraging digital technologies.

Value Creation Cornerstones

I look forward to being able to foster a sense of unity by showcasing different themes that underscore DIC’s positive features and incorporate actualcomments from employees through published articles and online events. I am proud to work for DIC and will continue to provide information aimed at

Theme

Outline

Details

Office remodeling

Promote an open plan layout at corporate headquarters and
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Support work styles that enable employees to choose the location,functions and environment that best suit their particular work. Regarding
the open plan layout at corporate headquarters, design zone-specific
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Casual dress code

Foster a corporate culture that emphasizes mutual respect andacceptance of diversity by promoting a casual dress code at
FRUSRUDWHKHDGTXDUWHUVEUDQFKHVDQGVDOHVRI¿FHV

Introduce Casual DIC, a framework that allows each individual to freely
choose their work attire within certain parameters and with consideration
for time, place and occasion.

Improvement of practical skills inleveraging digital technologies

Further enhance productivity through the use of digitaltechnologies and data.

Develop rank- and role-specific training programs to raise employees’
minimal digital skills level. Appoint a DX leader in each business area topromote departmental and Companywide DX initiatives and strengthen
the digital capabilities of human resources.

DIC Report 2022 ̲50

Data

Reforms to Enhance Workplaces (Beginning in Fiscal Year 2022)

VOICE We are working to create better work environments for employees.
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become common everywhere. This change provided an opportunity to take a close look at various aspects of Group workplaces, which we had never done
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style and help bolster productivity.
:KDWZDVSDUWLFXODUO\GLI¿FXOWZDVWKDWWKHDQVZHUWRWKHVHTXHVWLRQVZDVQRWVLPSO\DQH[WHQVLRQRIHIIRUWVZHKDGPDGHWRGDWH:HKDGWRVWDUWDJDLQZLWKa blank slate. So while there were a lot of challenges, at the same time it was an interesting and rewarding experience.
7KDQNVWRWKHFRRSHUDWLRQRIFROOHDJXHVZHDUHQRZZRUNLQJWRUHDOL]HRI¿FHVWKDWPDNHHPSOR\HHVZDQWWRZRUNRQVLWH,KRSHHYHU\RQHLVORRNLQJIRUZDUGWRWKHQHZRI¿FHV

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

HR Group, General Aﬀairs and HR Department

Masatoshi Tsumanami| Process Reforms
Alongside efforts to bolster job satisfaction and create workplaces that empower employees to fully demonstrate their capabilities, the DIC*URXSLVDGYDQFLQJDSURMHFWWKDWLQYROYHVDWKRURXJKJRLQJUHYLHZDQGVLPSOL¿FDWLRQRIH[LVWLQJZRUNVW\OHVDQGUXOHVWRHQVXUHWKDWLQGLYLGXDO
and cross-departmental operations are seamless and automated. The Group is also promoting the standardization of business processes
and data, creating a cycle that permanently improves the productivity of individuals, departments/divisions and the Group as a whole.
Additionally, efforts are also being aligned with ongoing digitalization measures to maximize the performance of the entire DIC Group.

Theme

Outline

Details

Digital business infrastructure

Build a global digital infrastructure and continuously update
business processes and rules.

Realize standardized, automated and seamless operations bysimplifying and promoting consistent business processes andrules across all departments.

Stronger competitive foundation,PSURYHHI¿FLHQF\WKURXJKWKHGLJLWDOL]DWLRQRIRSHUDWLRQVDQG
promote the optimization of the entire value chain.

Advance digital marketing, smart production facilities andsupply management from the perspective of total, rather than
GHSDUWPHQWVSHFL¿FRSWLPL]DWLRQStreamline time-consuming daily tasks.

Review approval procedures and approaches to conducting
PHHWLQJV,PSURYHHI¿FLHQF\DQGOHVVHQZRUNORDGE\VLPSOLI\LQJ
approval procedures, and by ensuring a quantitative grasp of andsetting new rules for meetings conducted.

(I¿FLHQF\RIGDLO\RSHUDWLRQV

Data

VOICE *RLQJEH\RQGLQGLYLGXDOZRUNHIÀFLHQF\ZHDUHZRUNLQJWRDFKLHYHRSWLPL]DWLRQIRUWKHHQWLUH*URXS
In January 2022, DIC launched the CONNECTUS Project with the aim of building a global digital infrastructure and developing new business processes. The
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WKHSHUVRQLQFKDUJHRISXUFKDVLQJXQGHUWKLVSURMHFW,KDYHKDGWREURDGHQP\IRFXVWRLQFOXGHDVNLQJTXHVWLRQVVXFKDV³,VWKLVWDVNQHFHVVDU\LQWKH¿UVW
place?”, “What is the relevance of this particular business process?” or “Can we do this the same way overseas?”
Going forward, we will continue working to achieve dramatic improvements in the productivity of individual employees, departments/divisions, companies andthe DIC Group as a whole. We will do this by promoting reforms from the perspective of overall optimization, rather than simply seeking to digitalize existing
practices and business processes.
CONNECTUS Project, Information Systems Department

Miyuki Tajima,Q¿VFDO\HDUWKH:65SURMHFWZDVJLYHQFRPPLWWHHVWDWXVDQGUHQDPHGWKH:65&RPPLWWHHWRHQVXUHUHIRUPVLQWKHVH
three categories are implemented successfully across the entire Group. The committee not only gauges the effectiveness of measures but also
discusses the existence of other related issues that need to be addressed or measures that should be implemented, and includes DIC’s President
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51̲ DIC Report 2022

A Message from the Head of the ESG Unit

We involve all employees in the promotionof sustainability initiatives.

Kuniko Torayama

The basic policy of DIC Vision 2030 is “Safely delivering Color & Comfort for sustainable prosperity to enhance shareholder value andlong-term corporate value.” One result of this new policy is that employees have become more aware of the pursuit of social value as
an issue that affects them and have come to have clear expectations regarding the outcome of sincere efforts. Accordingly, with akeen awareness of diversity, at corporate headquarters we are enhancing human capital by supporting employee growth, as well as
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Revolution (WSR) 2020 Committee, will also help drive further innovation, which will in turn enable us to contribute to the resolution ofsocial imperatives, thereby creating a continuous cycle of positive outcomes.

Value Creation Strategies

Advancing Diversity

Value Creation Cornerstones%HJLQQLQJLQ¿VFDO\HDUWKH',&*URXSKDVSRVLWLRQHGWKHSURPRWLRQRIVXVWDLQDELOLW\DVDFRUHPDQDJHPHQWVWUDWHJ\UHLWHUDWLQJ
its commitment to stepping up the implementation of sustainable prosperity initiatives in DIC Vision 2030. This plan sets forth twocentral goals: “Establish a business portfolio that contributes to sustainability for society” and “Help achieve sustainability for the global
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in which it will leverage its competitive strengths to help realize a society that is green, digital and QOL-oriented. In addition, DIC Vision
2030 also calls for DIC to mature as a unique global company that is trusted by society by reinforcing management of its human capital
to boost the value thereof, recognizing its employees as its most important resource. I look forward to the ESG Unit, of which I am incharge, working with the Corporate Strategy Unit to drive sustainability strategies forward in tandem with business strategies. The scale ofsustainability initiatives is much greater than in the past, as is enthusiasm for their implementation. We will continue seeking to improve theeffectiveness of our efforts by taking on board key social imperatives and involving all DIC Group employees.

Value Creation Essentials([HFXWLYH2IÀFHU
+HDGRI(6*8QLW,Q&KDUJHRI'LYHUVLW\As already mentioned, one of the two central goals of DIC Vision 2030 is to help achieve sustainability for the global environment
and for society. One way we are attempting to achieve this goal is by working to increase the percentage of products in our portfolio
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products accounted for 40% of our portfolio, so our target is still a ways off. By steadily implementing plans formulated in collaboration
with employees at our bases in the Americas and Europe, as well as in Asia, we will continue striving to achieve our 60% target and tosupport a sustainable society.
Regarding the urgent challenge of addressing climate change, we have set an ambitious target for reducing CO2 emissions by 50% from
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production processes, recognizing that achieving a 50% reduction will require ingenuity and leveraging our position as a manufacturer
RI¿QHFKHPLFDOV,QDGGLWLRQZHDUHSURPRWLQJHIIRUWVWRKHOSUHDOL]HDFLUFXODUHFRQRP\:HDFNQRZOHGJHWKDWWKHUHDUHVLJQL¿FDQW
differences in efforts being pursued between Europe, which is engaged in a variety of cutting-edge initiatives, and other regions. We
believe that social infrastructure is essential to the achievement of the targets that we have set. DIC Group companies around the world
will continue to learn from the examples set by regions pursuing advanced initiatives to steadily expand our efforts.
In December 2021, we held a presentation to introduce Group ESG initiatives. This reaffirmed our awareness of the value ofopportunities to communicate directly with stakeholders to, for example, introduce environment-friendly products developed and provided
by the DIC Group. Going forward, we will step up efforts to disseminate information and communicate effectively with both internal and
H[WHUQDODXGLHQFHVLQFOXGLQJWKURXJKUHJXODUUHODWHGEULH¿QJVDIC Report 2022 ̲52

Data

The Growing Importance of Sustainability Strategies

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53̲ DIC Report 2022

DIC Sustainability Index
DIC Sustainability Index
All DIC Group products will be mapped on the index
Low

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Social contribution

Sustainableproducts

High

Value Creation Essentials

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DIC Report 2022 ̲54

Data

Focus on Products that Demonstrate Unique Competitive Strengths

Corporate Governance
Basic Approach to Corporate Governance
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General Meeting of Shareholders
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Board of Directors

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Audit & Supervisory Board

Nomination Committee
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Cooperation

Audit

Accounting auditors
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Value Creation Cornerstones

President and CEO
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Quality Committee
WSR 2020 Committee

Cooperation

Cooperation

Executive Committee

Business groups, New Business Development Headquarters,
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Remuneration Committee

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55̲ DIC Report 2022

4

Executive Committee

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%RDUGRI'LUHFWRUV
5

Sustainability Committee

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managers of the management units and product divisions. Details of deliberations at meetings regarding matters of particular importance and the results
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8

Audit & Supervisory Board

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9

Value Creation Strategies

7

Value Creation Cornerstones

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Quality Committee

Internal Auditing Department

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10 Accounting Auditors

The Company has engaged Deloitte Touche Tohmatsu LLC as its independent auditors. The Company strives to ensure an environment that facilitates the
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auditing activities.

| Rationale Behind Current Corporate Governance System
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the internal auditing department. This structure ensures the effective functioning of the Company’s corporate governance system.

DIC Report 2022 ̲56

Data

6

| System of Internal Controls
1

Status of the System of Internal Controls and the Establishment and Operation of a Framework for Risk Management,QVWULYLQJWRFRQGXFWLWVRSHUDWLRQVLQDFFRUGDQFHZLWK7KH',&:D\WKH',&*URXSKDVSUHSDUHGDQGRSHUDWHVDV\VWHPRILQWHUQDOFRQWUROVEDVHG
on the Companies Act of Japan to ensure the appropriateness of its operations.
2

Basic Policy Toward Eliminating Demands by Antisocial Elements

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each Group company. These individuals work in close collaboration with legal counsel and the police to ensure the Company’s responses
are resolute. The Company has also prepared and distributed a manual on appropriate responses to such demands with the aim of raisingawareness among employees.

9DOXH&UHDWLRQ6WUDWHJLHV

9DOXH&UHDWLRQ(VVHQWLDOV| Outside Directors and Outside Audit & Supervisory Board Members
1

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2

Value Creation Cornerstones

Independence Standards for Outside Directors and Outside Audit & Supervisory Board Members

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PHPEHUVVHWE\WKH7RN\R6WRFN([FKDQJH
3

Data

Number and Role of Outside Directors and Outside Audit & Supervisory Board Members

Support System for the Outside Directors and Outside Audit & Supervisory Board Members

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1

Composition of the Board of Directors

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operations and the need to manage its businesses in a manner that takes diversity into
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Composition of the Board of Directors and the Audit & Supervisory Board
In-house

2XWVLGH

Total

Percentage of outside
members

Directors

6

3

9

33.3%

$XGLW 6XSHUYLVRU\%RDUGPHPEHUV

2

2

4

50.0%

Total

8

5

13

38.5%

57̲ DIC Report 2022

Composition of the Board of Directors
In-house
Outside

38.5%
61.5%

Skills Matrix for Directors and Audit & Supervisory Board Members
Expertise/Experience
Name

Position

Masayuki
Saito

Chairman of theBoard of Directors

●

●

Kaoru
Ino

Representative Director
President and CEO●●

Toshifumi
Tamaki

Representative Director
Executive Vice President●

Yoshihisa
Kawamura

Director●TakeshiAsai

Director
Managing Executive Ofﬁcer

●

●

Shuji
FurutaDirector
Managing Executive Ofﬁcer

●

●

Kazuo
Tsukahara

Outside Director●

YoshiakiTamuraOutside Director

●

●

●

●

●

KunikoShoji

Outside Director

●

●

●

●

●

Hiroyuki
Ninomiya

Audit & Supervisory
Board Member(Full-time)
Audit & Supervisory
Board Member(Full-time)
Audit & Supervisory
Board Member(Independent)
Audit & Supervisory
Board Member(Independent)

Michiko
Chiba
Keita
Nagura●●IT/DX

Personnel/
labor

●

●

●

●

●

●

●

●

●

●

●

●

Production/
quality●●●

Marketing/sales/ Technology/
purchasing
R&D

●

●
●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●
●

●

Remuneration for Directors and Audit & Supervisory Board Members

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Evaluating the Effectiveness of the Board of Directors

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part of its ongoing effort to promote improvement.

| Ensuring DIC Remains a Globally Trusted Corporate Citizen with a Proud Reputation

Leveraging its Position as a Global Manufacturer of Fine Chemicals to Support the UNGC
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81*& DQGSOHGJHGLWVVXSSRUWIRUWKH7HQ3ULQFLSOHVRIWKH81*&,QDXJXUDWHGLQWKH81*&LVDYROXQWDU\LQLWLDWLYHIRUFRPSDQLHVWKDWVHHNWRDFKLHYHVXVWDLQDEOH
GHYHORSPHQW&RPSDQLHVDQGRUJDQL]DWLRQVZRUOGZLGHKDYHSOHGJHGWKHLUVXSSRUWIRUWKH81*&LQWKH
EHOLHIWKDWJOREDOVXVWDLQDEOHGHYHORSPHQWLVSRVVLEOHLIFRPSDQLHVDOLJQWKHLUEXVLQHVVSUDFWLFHVZLWKDQGIXOILOOWKHLUVRFLDOUHVSRQVLELOLWLHVLQJOREDOO\DFFHSWHGSULQFLSOHVLQWKHDUHDVRIKXPDQULJKWVODERUWKHHQYLURQPHQWDQGWKHSUHYHQWLRQRIFRUUXSWLRQDIC Report 2022 ̲58

Value Creation Cornerstones

3

Data

2

Sustainability

Value Creation Essentials

AkihiroIkushima

Corporate
Finance/
Legal affairs/ International
management asset building risk management experience

Value Creation Strategies

7R HQDEOH WKH %RDUG RI 'LUHFWRUV WR
resolve major operations-related issues
as well as to facilitate the effective
RYHUVLJKWRIPDQDJHPHQWWKH%RDUGRI
Directors comprises individuals having athorough knowledge of the businesses
RI WKH ',& *URXS ZLWK FRQVLGHUDWLRQ
given to ensuring a balance among
QHFHVVDU\ NQRZOHGJH H[SHULHQFH
and capabilities. The table to the rightis a skills matrix summarizing theNQRZOHGJHH[SHULHQFHDQGFDSDELOLWLHVRI F XU UHQW GLUHF WRU V DQG $XGLW 
6XSHUYLVRU\%RDUGPHPEHUVDirectors, Audit & Supervisory Board Members and Executive Officers（ 2019 年 0 月現在）
(As of May 2022)

Value Creation Strategies

Value Creation Essentials| Directors

1

2

Value Creation Cornerstones

Masayuki Saito

Chairman of the Board of Directors

Kaoru Ino

Representative Director

3

Toshifumi Tamaki

Representative Director

4

Yoshihisa Kawamura

Director

5

Takeshi Asai

Director

6

Shuji Furuta

Director

7

Kazuo Tsukahara

Director*

8

9

Kuniko Shoji

Director*

8

6

5

7

9

Yoshiaki Tamura

Director** Outside

3

1

2

4

| Audit & Supervisory Board Members
1

Hiroyuki Ninomiya

Full-Time Audit & Supervisory Board Member
2

Akihiro Ikushima

Full-Time Audit & Supervisory Board Member
3

Michiko Chiba

Audit & Supervisory Board Member*

Data

4

Keita Nagura

Audit & Supervisory Board Member** Outside

3

Kuniko Shoji

4

Michiko Chiba

June 2004 Executive Officer, Terumo Corporation
April 2008 Director and Managing Executive Officer, IHI Corporation
April 2012 Representative Director and Executive Vice President, IHI Corporation June 2010 Director and Senior Executive Officer, Terumo Corporation
June 2017 Advisor, Terumo Corporation
June 2014 Advisor, IHI Corporation

October 1989 Joined Showa Ota & Co. (currently Ernst & Young ShinNihon LLC)
July
2010 Senior Partner, Ernst & Young ShinNihon LLC
September 2016 Founded Chiba Certified Public Accountant Office

Yoshiaki Tamura

Keita Nagura

January 2007 Executive Officer, Asahi Glass Co., Ltd. (currently AGC Inc.)
March 2013 Representative Director and Executive Vice President, AGC Inc.
March 2017 Executive Fellow, AGC Inc.

April

59̲ DIC Report 2022

2

| 2XWVLGH$XGLW 6XSHUYLVRU\%RDUG0HPEHU3URÀOHV

| 2XWVLGH'LUHFWRU3URÀOHV
Kazuo Tsukahara

1

1998 Registered as an attorney (Osaka Bar Association); Joined Yodoyabashi Godo Law Office(currently Yodoyabashi & Yamagami Legal Professional Corporation)
February 2002 Changed registration as an attorney to the Dai-Ichi Tokyo Bar Association

Toshifumi Tamaki

Naoyoshi Furuta

Masaya Nakafuji

Kazuo Hatakenaka

President and CEO

Executive Vice PresidentManaging Executive Officer

Managing Executive Officer

Managing Executive Officer

Assistant to President and CEO

General Manager, Production
Management Unit

Head of General Affairs and Legal Unit
In Charge of Osaka Branch and Nagoya
BranchChairman, DIC (China) Co., Ltd.
Chairman, DIC (Shanghai) Co., Ltd.

Kiyotaka Kawashima

Masamichi Sota

Kiyofumi Takano

Yoshinari Akiyama

Myron Petruch

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

General Manager, Technical Management
Unit

President, Packaging & Graphic
Business Group General Manager,
Printing Material Products Div.

General Manager, New Business
Development Headquarters

President, Color & Display Business Group
General Manager, Color Material
Products Div.

President and CEO,Sun Chemical Corporation

Takeshi Asai

Shuji Furuta

Takashi Ikeda

Taihei Mukose

Paul Koek

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

Executive Officer

Executive Officer

Head of Corporate Strategy Unit
In Charge of Kawamura
Memorial DIC Museum of Art
Vice Chairman of the Board,
Sun Chemical Corporation

CFO
Head of Finance and Accounting Unit

President, Functional Products
Business Group General Manager,
Composite Material Products Div.

Head of SCM UnitManaging Director,
DIC Asia Pacific Pte Ltd

Koji Asada

Masahiro Kikuchi

Yuji Morinaga

Toshiro Ariga

Yuji Kikuchi

Executive Officer

Executive Officer

Executive Officer

Executive Officer

Executive Officer

Head of IT Strategy Unit
General Manager, DX Promotion Dept.

Deputy Managing Director (AP Region
Non Graphic Business and South Asia),
DIC Asia Pacific Pte Ltd

General Manager, Packaging Material
Products Div.

General Manager, R&D Management Unit
General Manager, Central ResearchLaboratories

General Manager, Performance
Material Products Div.

Tomoyuki Tanaka

Kuniko Torayama

Executive Officer

Executive Officer

General Manager, Corporate Planning
Dept.

Head of ESG Unit
In Charge of Diversity

DIC Report 2022 ̲60

Data

Value Creation Cornerstones

Value Creation Strategies

Kaoru Ino

Value Creation Essentials| ([HFXWLYH2IÀFHUV

A Message from an Outside Director

Value Creation Essentials

I look forward to DIC employees emphasizing
pride, as well as kindness and contentment, totake the Color & Comfort concept to a new level.
Yoshiaki Tamura
Outside Director
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Data

Value Creation Cornerstones

Value Creation Strategies

A Corporate Culture Rooted in Kindness and Contentment
When I took up the position of outside director in 2018, I was immediately struck by the basic atmosphere of kindness and contentment.
Everyone seemed to be animated and to really enjoy what they were doing. I was wondering how a company with a history stretching backmore than 100 years had succeeded in creating such a modern corporate culture. I concluded that the answer can be found in the Color& Comfort management vision. A vibrant, worry-free life is something people aspire to no matter where in the world they live. DIC is a
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recently, I have been impressed by how quickly DIC moved to make necessary adjustments to cope with the COVID-19 pandemic.

Emphasizing Pride to Advance to the Next Level
In fiscal year 2021, DIC took the Color & Comfort concept to a new level by seeking to link it to the resolution of social imperatives,
looking at whether we couldn’t step up efforts to take on the challenge of entering new markets to better respond to ESH-related issues.
In addition to recognizing the importance of each and every employee setting ambitious targets and having the fortitude and ability totranslate ideas into action to ensure their achievement, the Company also understands the importance of being able to analyze what islacking, seek assistance from a superior—whether by increasing personnel or budget—to course correct.
Personally, I have always believed in the importance of fun, trust and pride. DIC already has a strong philosophy of fun and trust. Goingforward, I would like to see a greater emphasis on pride. By that I mean that I would like to see employees approach their work with pride
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WKLVHQGLWLVLPSRUWDQWIRUVXSHULRUVWRFRQYH\WKHLUH[SHFWDWLRQVWRWKHLUVXERUGLQDWHVDQGFOHDUO\GH¿QHGXWLHVDVZHOODVWRDFWLYHO\encourage communication.

The Key to the Future,Q¿VFDO\HDUWKH&RORUV (IIHFWVEXVLQHVVIRUPHUO\WKHJOREDOSLJPHQWVEXVLQHVVRI*HUPDQ\¶V%$6)DQG,WDOLDQDGKHVLYHVDQG
polymers manufacturer SAPICI S.p.A. joined the DIC Group. It is my hope that while maintaining its excellent corporate culture DIC will
also continue to display leadership in guiding these new members of the team to achieve robust results. Developing a scenario for the*URXS¶VJOREDOVWUDWHJLHVDQGDFFHOHUDWLQJWKHLPSOHPHQWDWLRQRIWKRVHVWUDWHJLHVLVFUXFLDO0XFKOLNHSXWWLQJWRJHWKHUDQLQWULFDWHMLJVDZ
puzzle, such a scenario will encourage employees to approach their own roles with renewed enthusiasm, which in turn will inspire theactive exchange of opinions among the Group’s diverse human resources, a process of action and reaction that will yield innovative ideas.
Pressing ahead with such efforts is the key to the future and will surely open exciting new doors for the DIC Group to evolve as a uniqueglobal company that is trusted by society. I pledge to continue leveraging my own capabilities to support everyone.

61̲ DIC Report 2022

Overview of Sustainability
In line with its basic sustainability policy, the DIC Group promotes a variety of sustainability initiatives worldwide and works to maintain an accurate
grasp of social imperatives pertaining to ESG-related issues.

Basic Sustainability Policy（Partially revised in March 2019）

Notes: 1. With the aim of ensuring that it remains a globally trusted corporate citizen with a proud reputation, in December 2010 the DIC Group became a signatory to the UNGC.
The Group also takes the guidelines provided by ISO 26000, the International Organization for Standardization’s standard for social responsibility, into account in conducting its operations.
2. The global community today recognizes the promotion of ESG management, which seeks to balance sustainable economic growth and the resolution of social
imperatives, as critical. This is evidenced by the fact that countries worldwide have ratified the Paris Agreement and the SDGs, both of which were adopted in 2015.

¦ Sustainability Framework and Themes
ThemesCore and category-specific themes
Themes that combine
elements of (A) and (B)Environment, safety and health (ESH)
Climate change
Quality
Human resources management
Sustainable procurement

Basic
Basic
(B))
themes(BthemesComplianceBusiness continuity management (BCM) and crisis management
Information security()

Deployment
In line with its basic sustainability policy, the DIC Group has formulated a medium-term (fiscal years 2022–2025) policy and creates an annual activity
plan for each of its key sustainability themes. The Group makes use of the plan-do-check-act (PDCA) cycle in promoting initiatives and reports on its
achievements annually in the DIC Report. Individual business groups, product divisions, sites, and overseas and domestic DIC Group companies arecharged with pursuing effective sustainability programs by formulating their own activity plans, based on the Group’s plan, as well as with ensuringthat the Group’s policies permeate their organizations and labor forces, and promoting sustainability initiatives that align with business targets.

¦ System for Promoting Sustainability Initiatives

The DIC Group’s system for promoting sustainability initiatives centers on the Sustainability Committee, which answers directly to the president and CEO.
In addition to reporting periodically on the progress of initiatives implemented in line with the Group’s sustainability themes, the committee is tasked withformulating sustainability themes and activity plans, reinforcing sustainability initiatives and deliberating on critical related matters. Effective from January
2020, the committee is chaired by the president.

¦ The 2030 Agenda for Sustainable Development
At the UN Sustainable Development Summit in September 2015, a proposal titled “Transforming
our world: the 2030 Agenda for Sustainable Development,” later summarized as the Sustainable
Development Goals (SDGs), was adopted with the participation of more than 150 UN
member states. The agenda, which succeeded the Millennium Development Goals (MDGs),
encompasses 17 goals and 169 targets. All UN member states are expected to mobilize efforts
to attain the 17 goals, essential to sustainable development for the planet, by 2030. The DIC
Group pledges to contribute through its business activities to the success of the SDGs.
For more information on the SDGs, please visit:https://www.un.org/sustainabledevelopment/development-agenda/

DIC Report 2022 _62

Value Creation Cornerstones

Sustainable technology and product development
New value creation
Digital transformation (DX)Harmony with the community and social contributions
Communication with stakeholders

Data

Themes that demonstrateunique capabilities (A)Value Creation Strategies

The DIC Group’s sustainability framework comprises 13 key themes, which are categorized as basic themes, themes that demonstrate uniquecapabilities and themes that combine elements of the previous two classifications. The Group implements a broad range of global initiatives thattake into account its responsibility to ensure proper product stewardship, as well as its position as a leading manufacturer of fine chemicals.

Value Creation Essentials

The DIC Group is dedicated to conducting its business while retaining a strong commitment to five key concepts: preserving safety
and health, managing risks, ensuring fair business practices and respect for diversity and human rights, maintaining harmony withthe environment and advancing its protection, and creating value for society through innovation and contributing to ongoing economic
growth. DIC Group employees will continue working to deliver the value that its stakeholders—including its customers, suppliers, local
communities, shareholders and investors, and employees—expect, showing ingenuity and a sense of responsibility. The Group itself will
strive to remain an organization that contributes to sustainability for society, as well as to the conservation and improvement of the global
environment, by capitalizing on its businesses to achieve unfaltering growth, thereby enhancing its own sustainability.

Compliance

SDGs Goal 16
QR codeToward Fair and Transparent Corporate Activities
WEB

https://www.dic-global.com/en/csr/philosophy/compliance.html| The DIC Group Code of Business Conduct
The DIC Group completed the DIC Group Code of Business Conduct in July 2014. The code not only mandates compliance with national laws andinternational rules but also presents 10 principles essential to the professional conduct of DIC Group employees. The Group held presentations for all
existing Group employees at the time of release, while new employees receive training at point of hire. The goal of such training is to ensure employees
worldwide share values cherished by the Group and approach their responsibilities with a sense of responsibility and a commitment to doing the right thing.
DIC Group Code of Business Conduct WEB https://www.dic-global.com/pdf/csr/philosophy/compliance/code_of_business_conduct_en.pdf

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials| Initiatives to Promote Compliance
The DIC Group promotes compliance through the following initiatives:❶ Legal training focused on improving compliance awareness is provided for employees at point of hire, when promoted and before transfer overseas.
In addition, to promote awareness of the DIC Group Code of Business Conduct, e-learning related to the code, as well as to compliance, is provided
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employees because of COVID-19, but training regarding corporate governance and other themes was implemented in Japan for DIC executives andthe presidents of domestic Group companies, among others.
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2021, there were no serious violations of compliance laws.

| Establishing and Operating a Whistle-Blowing System
The DIC Group has established a compliance whistle-blowing system independent from channels for communication used in the conduct of business.
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countries.) The Group has also devised strict rules under this system to protect whistle-blowers from retaliation and works to ensure the system functions
in a proper manner.

Business Continuity Management (BCM) and Crisis Management

QR codeReducing Business Risks and Preventing the Recurrence of Incidents
https://www.dic-global.com/en/csr/philosophy/bcm.html

2017| Framework for Promoting BCP
Having prepared crisis management rules and risk-specific manuals for use across the DIC Group in the event of a major disaster, DIC has
formulated business continuity (BCPs) for individual product divisions. The Group also recognizes the need to ensure it can fulfill its supply
responsibilities in the event of damage to its facilities from a large-scale natural disaster and thus incorporates this perspective into its BCPs.
6SHFLILFDOO\WKH*URXSIRUPXODWHV%&3VIRUNH\SURGXFWVZLWKDYLHZWRIXOILOOLQJLWVVRFLDOUHVSRQVLELOLW\DQGUHVSRQGLQJWRFXVWRPHUUHTXLUHPHQWVDIC also conducts BCP-focused joint production division–site exercises assuming the implementation of these BCPs to confirm the effectivenessof manuals, identify issues and implement ongoing improvements.

| BCM in Fiscal Year 2021
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5HVSRQGLQJHIIHFWLYHO\WRDFFLGHQWVDQGGLVDVWHUVGHSHQGVRQHPSOR\HHVKDYLQJDFRUUHFWXQGHUVWDQGLQJRI%&0DQGRIKRZWRSURSHUO\H[HFXWH',&¶V%&3V7KLVLQ
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widespread use of telework arrangements, making it necessary for the task force to operate exclusively via online meetings, and involved linking the task force
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63̲ DIC Report 2022

| Improving the Effectiveness of BCPs and Preventing Them from Becoming Mere Formalities
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IRUPDWWDNLQJLQWRDFFRXQWWKHIXWXUHHYROXWLRQRI*URXSFRPSDQLHVWRFRPSO\ZLWKWKHUHTXLUHPHQWVRI,62WKH,62¶VVWDQGDUGIRUEXVLQHVVFRQWLQXLW\PDQDJHPHQWV\VWHPV:LWKWKHDLPRIEULQJLQJLWV%&3VFORVHULQOLQHZLWKWKH,62VWDQGDUGWKH*URXSLQFRUSRUDWHGPHDVXUHVWRFRXQWHU
issues that obstruct business continuity.
The DIC Group also conducts annual status update meetings attended by relevant executives to verify that the content of individual product division
BCPs to ensure they remain relevant. The fiscal year 2021 status update meeting included examining measures for countering issues that obstruct
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| Responding to New Infectious Diseases

https://www.dic-global.com/en/csr/philosophy/security.html| Globally Maintaining and Enhancing Information Security
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employee education and training. To ensure swift responses to increasingly diverse cyber threats, the Group currently plans to deploy measures implemented inJapan to reinforce information security by enhancing its intranet security infrastructure and updating endpoint security systems in key overseas markets (the Asia–
3DFL¿FUHJLRQWKH35&7DLZDQDQGWKH52.
Regulations and Guidelines,QOLQHZLWKLWV%DVLF3ROLF\RQ,QIRUPDWLRQ6HFXULW\WKH',&*URXSXSGDWHVLWVFRQILGHQWLDOLQIRUPDWLRQPDQDJHPHQWUHJXODWLRQVZKLFKVWLSXODWHWKHVFRSHRI
management, and related standards, rules and responsibilities, as well as its information management guidelines, which outline implementation procedures, on a
UHJXODUEDVLVDQGDVUHTXLUHGWRHQVXUHLWVDELOLW\WRDGGUHVVQHZVHFXULW\ULVNVLQDWLPHO\PDQQHUThe Group also creates new and revises existing rules as appropriate in response to the increasing prevalence of digital technologies and the shift to cloudbased computing. In fiscal year 2021, in response to widespread moves to discontinue the practice of sending password-protected encrypted attachments inan email and then sending a password to unzip the file in a second email (dubbed “PPAP”*), a security measure previously popular with Japanese companies,
the Group revised related measures and corresponding guidelines. Enforcement of the new measures and guidelines commenced in January 2022.
33$3LVDQDFURQ\PIRU³3DVVZRUGSURWHFWHG¿OH´³3DVVZRUG´³Angoka (“encryption” in Japanese) and Protocol.” Japanese companies have been encouraged to discontinue the practice for security reasons.

Management Framework
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timely update of rules and guidelines to accommodate new technologies and risks, and to ensure changes are communicated effectively across the DIC*URXS7KHFRPPLWWHHIRUPXODWHVDQQXDOWDUJHWVDQGLQLWLDWLYHVIRUVWUHQJWKHQLQJLQIRUPDWLRQVHFXULW\ZLWKWKHDSSURYDORIWKH6XVWDLQDELOLW\&RPPLWWHH
and manages the progress of related efforts.
7KH*URXSLVFXUUHQWO\H[SORULQJWKHLGHDRIHVWDEOLVKLQJDV\VWHPIRUHQVXULQJLQIRUPDWLRQVHFXULW\IRUWKHHQWLUHJOREDO',&*URXSLQFOXGLQJ6XQ&KHPLFDO
Infrastructure
Against a backdrop of increasingly active and sophisticated cyber attacks, including ransomware and targeted threats, the DIC Group is working to
respond to rapid changes in working environments attributable to work style reforms, including the expansion of remote work and the increased use of
FORXGEDVHGVHUYLFHV,Q¿VFDO\HDUWKH*URXSFRQWUDFWHGDWKLUGSDUW\RUJDQL]DWLRQWRFRQGXFWDULVNDVVHVVPHQWWRHYDOXDWHWKHHIIHFWLYHQHVV
and comprehensiveness of its information security measures from a multifaceted perspective. Based on the results of this assessment, the Group will
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risks to its businesses and management.
Employee Education and Training
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of security. In response to the post-pandemic “new normal,” the Group is currently formulating guidelines that accommodate new work styles, notably
telework, which it will work to disseminate to employees worldwide.

DIC Report 2022 ̲64

Value Creation Strategies

Initiatives to Ensure Information Security

Value Creation Cornerstones

QR code

Data

Information Security

Value Creation Essentials',&KDVSUHSDUHGDKHDGTXDUWHUVWDVNIRUFHPDQXDODQGSURGXFWGLYLVLRQ%&3VIRUUHVSRQGLQJWRLQIHFWLRXVGLVHDVHVWRJXDUDQWHHLWLVIXOO\SUHSDUHGWRUHVSRQGWRSDQGHPLFVZKHQWKH\RFFXU+RZHYHUEHFDXVHWKHVHDVVXPHGRXWEUHDNVRIQHZVWUDLQVRILQÀXHQ]DWKH\SURYHGLQDGHTXDWHLQGHDOLQJZLWK&29,'$FFRUGLQJO\WKHKHDGTXDUWHUVWDVNIRUFHPDQXDOZDVUHYLVHGVLJQL¿FDQWO\DVZDVWKHIRUPDWIRU%&3VWRLQFOXGHJHQHUDODQGXQLYHUVDOPHDVXUHVGHVLJQHGWRFRSHZLWKQHZLQIHFWLRXVGLVHDVHVRWKHUWKDQLQÀXHQ]DEnvironment, Safety and Health (ESH)

SDGs Goals 3, 6, 7, 12, 13, 14 and 15
QR codeToward the Achievement of a Sustainable Society
https://www.dic-global.com/en/csr/environment/

As a global organization that manufactures and sells chemical substances, the DIC Group promotes a broad range of ESH initiatives through its
Responsible Care program. The Group manages its Responsible Care program in a uniform manner using standardized codes, guided by its Environment,
Safety and Health Policy, and works to implement initiatives that exceed regulatory requirements, in line with annual Responsible Care activity plans,
and to fully disclose the results thereof. The Group’s framework for promoting Responsible Care includes the Sustainability Committee, which approves
Groupwide sustainability targets and policies, as well as formulates and evaluates medium-term sustainability policies and annual sustainability initiatives.
The PDCA cycle is used to evaluate voluntary Responsible Care initiatives implemented by Group companies, plants and R&D facilities in collaboration
with the Safety and Environment Group. The Responsible Care Department provides support to ensure the smooth progress of these initiatives andconducts audits to ensure compliance, and to improve safety and environmental performance.
Note: Responsible Care describes voluntary management initiatives undertaken by companies that manufacture or otherwise handle chemical substances, in line with the principles
of autonomous action and self-assessment, pledging in their management policies to protecting the environment and ensuring health and safety across the entire life cycle ofproducts, from development to manufacturing, distribution, use and end-of-life disposal, as well as to disclosing related information and promoting improvements.

Environment, Safety and Health Policy

Framework for Promoting Responsible Care

As a responsible corporate citizen and as a company that manufactures and sells chemical
substances, DIC recognizes that care for the environment, safety and health is fundamental tothe management of the Company. DIC is committed to the concept of sustainable development in
all aspects of its businesses and contributes to the global environment, including biodiversity, by
creating environmentally sound products and technologies.

Sustainability Committee

Production
Management Unit

Technical
Management Unit

Responsible Care Department
Support for ESH audits
Production and R&D facilities❶ We take responsibility for the environmental, safety and health implications of products
throughout their life cycles.
❷ We continuously set goals and targets for environmental, safety and health improvements.
❸ We comply strictly with laws, regulations and agreements relative to the environment, safety
and health. For countries lacking such laws, we prioritize safe operations and protection of
the environment.
❹ We systematically provide education and training on the environment, safety and health.
❺ :HSUHSDUHV\VWHPVDQGDXGLWLQWHUQDOO\WREHQH¿WWKHHQYLURQPHQWVDIHW\DQGKHDOWKSafety and Environment Group

Individuals in charge of
Responsible Care

Product division
Individuals in charge of
Responsible Care

Technical

Production

Product division

Product division
Individuals in charge of
Responsible Care

We disclose these policies internally and externally and ask that all DIC Group companies
observe them. The abovementioned “safety” also encompasses security and disaster prevention.

Occupational Safety and Health/Disaster Prevention
Viewing the prioritization of operational safety as a core management tenet, the DIC Group works tirelessly to prevent accidents and disasters and to boost the level of ESH initiatives.
TRIR and Casualties Due to Occupational Accidents (FY2019–2021)
200

6.00

150

4.50

100

3.00

50

1.50

0

2019 2020 2021

2019 2020 2021

2019 2020 2021

2019 2020 2021

Japan

PRC

Asia–Pacific region

Americas and Europe

Fatalities

Injuries resulting in workdays lost2019 2020 2021 (FY)

Injuries not resulting in workdays lostTRIR

The DIC Group recognizes operational safety both as fundamental
to its businesses and the core component of Responsible Care.
The Group thus promotes active occupational safety and health,security and disaster prevention measures to foster a “Safety First”
philosophy Groupwide and on the part of every employee. With thegoal of fostering skilled safety personnel, the Group periodicallyprovides Kiken Yochi Training (KYT) (“hazard prediction training”)
and e-learning–based training based on Principles of Safe Conduct
in multiple languages around the world. Through these efforts, theGroup seeks to transform the mindset of employees by encouraging
them to think and act on their own to protect themselves and eachother from latent risks.

Casualties due to occupational accidents

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

Policies, Targets and Framework

0.00

GlobalTRIR

Environmental Protection
The DIC Group regards global environmental issues as being of primary importance and continues to promote initiatives aimed at reducing its environmental footprint with the aim ofcontributing to the realization of a sustainable society.

Environmental protection is among the most important of corporate sustainability activities. The DIC Group’s efforts focus on a number of areas, including
preventing environmental pollution, climate change (for more information, please see page 68), managing industrial waste (responding to a circular
economy), managing water resources and biodiversity.

65̲ DIC Report 2022

Preventing Environmental Pollution
Since chemicals companies handle a considerably greater volume and more diverse range of chemical substances than companies in other industries,
they must be extremely vigilant to prevent discharges of substances into the environment. Against this backdrop, the DIC Group promotes systematicefforts to prevent environmental pollution.
1

Reducing Emissions of VOCs

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,Q¿VFDO\HDU',&*URXSFRPSDQLHVLQ-DSDQUHSRUWHGWRWDOHPLVVLRQVRI92&VRIWRQQHVDGHFUHDVHRIIURP¿VFDO\HDU7KHSULQFLSDOIDFWRUEHKLQGWKLVUHVXOWZDVWKHGLYHVWLWXUHRI*URXSFRPSDQ\',&.DNR,QFDVLJQL¿FDQWHPLWWHURI92&VDVDUHVXOWRIZKLFKLWZDVH[FOXGHGIURPWKH
VFRSHRIFDOFXODWLRQ2YHUVHDV*URXSFRPSDQLHVLQ*UHDWHU&KLQDDQGWKH$VLD±3DFL¿FUHJLRQFRQWLQXHGWRFDUHIXOO\PRQLWRUHPLVVLRQV,QWKH35&LQ
particular, the Group is updating equipment and stepping up emissions management practices in response to the tightening of pertinent local regulations.

Managing Industrial Waste
In seeking to promote the realization of a circular economy (for more information, please see page 47), the DIC Group is stepping up efforts to encourage
the reuse, reduction and recycling of industrial waste and minimizing production losses by increasing throughput yields. The Group also works to fully
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TOPIC
DIC Graphics (Thailand)’s Amata Plant Receives Gold Level in AFS’ 2021 Best Waste Management Awards
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Thailand’s largest industrial estate development and management company.
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Through this awards program, AFS aims to raise awareness of the importance of effectively
managing industrial waste across all of its estates. “DIC Graphics (Thailand)’s Amata Plant
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precedence. In the year ahead, we will further strengthen waste management efforts with the
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Kanitta Mahasamut, ESH supervisor (left) and
Siwapol Yangthong, factory manager (center), of
0DQDJHPHQW$ZDUGVSURJUDP¶V6LOYHU*ROGDQG3ODWLQXP/HYHOFDWHJRULHVDIC Graphics (Thailand)’s Amata Plant

Managing Water Resources
Finding effective ways to conserve and manage water resources is a crucial global challenge. The DIC Group withdraws fresh water (tap water and industrial
water) for use in production processes and air conditioning and for drinking, among others. The Group also discharges wastewater—after purifying it in accordance
ZLWKYROXQWDU\LQWHUQDOVWDQGDUGVWKDWH[FHHGRI¿FLDOVWDQGDUGVLQWKHFRXQWULHVDQGWHUULWRULHVLQZKLFKLWKDVRSHUDWLRQV²LQWRULYHUVDQGRWKHUIUHVKZDWHUERGLHVIn addition to evaluating water risks at each of its production sites around the world and implementing countermeasures, the Group works to protect and ensure the
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DIC Report 2022 ̲66

Value Creation Strategies

Other Initiatives Aimed at Reducing Environmental Impact

Value Creation Cornerstones

3

In accordance with pertinent laws and regulations, the DIC Group monitors emissions of dioxins from facilities in Japan that produce these
byproducts, ensures the appropriate management of equipment containing polychlorinated biphenyls (PCBs) and waste, responds to potential
risks associated with asbestos, and implements soil and groundwater surveys and countermeasures as necessary and assesses related risks.

Value Creation Essentials

Reducing SOx, NOx and COD

Data

2

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has also worked to reduce chemical oxygen demand (COD), an indicator of environmental impact, in wastewater. Principal initiatives include switching
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Group is promoting the reuse of water and the installment of environment-friendly closed-loop recycling and wastewater treatment systems.

Production
volumeTotal energy consumption(crude oil equivalent)

OUTPUTDIC Group(Japan)INPUT

Economic development has driven up demand for water, leading to a gradual increase in transitional risks related to, among others, the depletion of regional
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risk. The DIC Group uses the Aqueduct Water Risk Atlas water risk assessment tool to assess regional water risks caused by external factors and has adopted
DSURSULHWDU\PHWKRGWRHYDOXDWHZDWHUULVNVDULVLQJIURPVLWHRSHUDWLRQV,Q¿VFDO\HDUWKH*URXSGHVLJQDWHGIRXU*URXSVLWHVWKDWDFFRXQWIRUWKHKLJKHVWSHUFHQWRISURMHFWHGLPSDFWDVSULRULW\VLWHVLPSOHPHQWLQJDQGFRQ¿UPLQJWKHHIIHFWLYHQHVVRIDYDULHW\RIFRXQWHUPHDVXUHVXQGHUWKHDXVSLFHVRIDWKLUGSDUW\RUJDQL]DWLRQ7KH*URXSDOVRDLPVWRFRPSOHWHLWVLPSOHPHQWDWLRQRIFRXQWHUPHDVXUHVDWVXFKVLWHVE\¿VFDO\HDU

4,183,000 GJ

tonnes239

Value Creation Cornerstones

Industrial waste disposedof as landfill+3%m3 from fiscal year 2020

199

345,000

Wastewater
discharged

0

Emissions into soil
Industrial waste
disposed of as landfill-4 %tonnes from fiscal year 2020

6,481,000 -16
m

3

from fiscal year 2020

Soil-related emissions of targeted substances(551 substances andone substance group)
tonnes+29

Emissions into the air
CO2 emissions+19 %tonnes(Toxic industrial waste included: 28 tonnes)

14,702Emissions into water%from fiscal year 2020（+7％）

tonnes-22%

the fiscal year 2020

(Toxic industrial waste
included: 2,430 tonnes)%

from fiscal year 2020

35,000千t
tonnesTotal energy consumption(crude oil equivalent)

2,373,000 GJ
Fresh waterwith drawn

5,181,000 ㎥

OUTPUT

Colors &Effects
Group

INPUT

Reference: Environmental Impact of Colors & Effects Group Environmental Initiatives (July–December 2021)

Production
volumeData

34

8,632,000 ㎥ -10

tonnesfiscalyear 2020-27% fromtonnesEmissions into soil

Aquatic emissions of targeted substances(551 substances and%one substance group)
tonnes from fiscal year 2020

OUTPUT

INPUT

Value Creation Essentials
Value Creation Strategies

1,069,000

9COD in+30 %wastewater 940 tonnes from fiscal year 2020

Fresh waterwith drawn

Production
volumeSOx emissions-27%

Wastewater discharged

26,904,000

fiscal
+3% from
year 2020-6 %from fiscal year 2020

fiscalyear 2020±0 % fromtonnesEmissions into water

27,625,000 ㎥

6,290,000 GJ

186

tonnes from fiscal year 2020

Fresh waterwith drawn

Total energy consumption(crude oil equivalent)NOx emissions+4 %tonnes from fiscal year 2020

* Renewable energy is not included in the above figure.

（+9％）

DIC Group(Overseas)

201,000

Atmospheric emissions of targeted substances(551 substances and one substance group)

fiscal
+9 % fromyear 2020

900,000

Emissions into the air
CO2 emissions

Emissions into soil

Emissions into the air
CO2 emissions

126,000

tonnesIndustrial waste disposedof as landfill

3,658

Emissions into water
Wastewater
discharged

5,181,000

m3

tonnes(Toxic industrial waste included: 132 tonnes)

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Chemical Industry Association (JCIA).

Safety in Logistics
The DIC Group works with logistics partners to minimize risks, including by supplying information needed for the safe shipping/transport of its products.

Having positioned the reduction of CO emissions attributable to the transport of its products as a key aspect of its commitment to promoting Responsible Care, DIC sets
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&RPSDQ\EHJDQXVLQJODUJHUWUXFNVDQGWRRNGHFLVLYHVWHSVWRLPSURYHORDGLQJHI¿FLHQF\DVDUHVXOWRIZKLFKLWDFKLHYHGGHFOLQHVLQHQHUJ\FRQVXPSWLRQDQG&2 emissions
DWWULEXWDEOHWRORJLVWLFVRIDQGUHVSHFWLYHO\',&DOVRFRQWLQXHVWRVXSSRUWWKH:KLWH/RJLVWLFV0RYHPHQWDQLQLWLDWLYHSXWIRUZDUGE\WKUHHJRYHUQPHQWPLQLVWULHV²WKH0LQLVWU\RI/DQG,QIUDVWUXFWXUH7UDQVSRUWDQG
Tourism, the Ministry of Economy, Trade and Industry, and the Ministry of Agriculture, Forestry and Fisheries—to improve working environments in the logistics industry.
By implementing measures in line with its own declaration of voluntary action, the Company also works to strengthen cooperation with logistics partners and transport
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facilities using returnable pallets. The use of returnable pallets has contributed to a decrease in CO emissions resulting from the disposal of one-way pallets. DIC Group
companies overseas also continue to actively advance the use of returnable pallets and other initiatives to lower the environmental impact of their logistics activities.

Ensuring the Safety of Chemical Substances
The DIC Group continues working to provide appropriate information to stakeholders to ensure the appropriate handling of its products over their entire life cycle.

In the PRC, the DIC Group responded to the revised China REACH legislation. In light of developments surrounding the ROK’s Occupational Safety and Health Act and
Taiwan’s Toxic and Chemical Substances of Concern Control Act (TCSCCA), related departments in Japan and overseas collaborated to gather information and formulate
countermeasures in a timely manner. On the systems front, the Group continued to promote a project aimed at realizing a new comprehensive global chemical substanceinformation management system, dubbed Chemicals Information CIGNAS (Global Network Access System). This system integrates (Chemical Substance Information
Comprehensive Management System) CIRIUS and the Wercs, currently in use, to facilitate the swift provision of consistent, accurate information to customers across the*URXSDQGLPSURYHWKHDELOLW\RI*URXSFRPSDQLHVLQWKH35&DQGWKH$VLD±3DFL¿FUHJLRQWRHQVXUHOHJDODQGUHJXODWRU\FRPSOLDQFH',&ODXQFKHG&,*1$6LQ-DSDQGXULQJWKHSHULRGDQGDLPVWRDFKLHYHIXOOJOREDOGHSOR\PHQWE\¿VFDO\HDU

67̲ DIC Report 2022

Management Systems
The DIC Group promotes a broad range of ESH initiatives through its Responsible Care program.

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$VRI'HFHPEHU',&*URXSFRPSDQLHVUHVSRQVLEOHIRURIWKH*URXS¶VSURGXFWLRQYROXPHKDGDFTXLUHGFHUWL¿FDWLRQXQGHU,62WKH
International Organization for Standardization’s standard for environmental management systems.
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Japan

Overseas

DIC

DIC Graphics

Other domestic DIC
Group companies

10 sites

4 sites

11sites

Total

Greater China

Asia–Pacific region

15 sites

23 sites

25 sitesTotal

38 sites

Climate Change

Audits Conducted at Subsidiaries’ Sites
in Fiscal Year 2021

Sun Chemical GroupSEIKO PMC Group

22 sites

13 sites
SDGs Goals 7 and 13
QR codePreventing Global Warming

Value Creation Strategies

Outline of ESH Audits Implemented in Fiscal Year 2021

Value Creation Cornerstones| ESH Audits
The DIC Group regularly conducts ESH audits to ensure the effectiveness of Responsible Care initiatives at Group companies, plants and R&D facilities.
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responsible for production, production and R&D site administrators, and labor union–endorsed union members. Audits also look at the implementation ofsafety initiatives and the progress of remedial measures undertaken in response to issues cited in the previous year’s audit. DIC’s president also takes part,
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conduct audits together with Responsible Care Department specialists and local site administrators to ascertain the progress of initiatives with the aim ofenhancing Responsible Care at individual sites.

Value Creation Essentials

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WKH$VLD±3DFL¿FUHJLRQKDGHDUQHGFHUWL¿FDWLRQXQGHU2+6$6DQGRU,62JLYLQJWKH*URXSLQWKHUHJLRQDFHUWL¿FDWLRQUDWHRI

https://www.dic-global.com/en/csr/environment/co2/

Recognizing climate change as a critical social imperative, the DIC Group is working to reduce emissions of CO from its sites with the aim of achieving carbon
QHXWUDOLW\,Q0D\WKH*URXSGHFODUHGLWVVXSSRUWIRUWKH7&)' SOHGJLQJWRGLVFORVHFOLPDWHUHODWHGLQIRUPDWLRQLQOLQHZLWK7&)'UHFRPPHQGDWLRQV*7KH7&)'ZDVHVWDEOLVKHGXQGHUWKHDXVSLFHVRIWKH)LQDQFLDO6WDELOLW\%RDUGDQGDQQRXQFHGLQ-XQHZLWKWKHREMHFWLYHRIPLWLJDWLQJFOLPDWHFKDQJH±UHODWHGLQVWDELOLW\DQGULVNLQ¿QDQFLDOPDUNHWVZKLFKKDV
the potential to affect performance over the long term.

| Framework for Promotion,QILVFDO\HDU',&HVWDEOLVKHGWKH&OLPDWH&KDQJH6XEFRPPLWWHHZKLFKLVUHVSRQVLEOHIRUGLVFXVVLQJDQGGHEDWLQJUHVSRQVHVWRFOLPDWHFKDQJH±UHODWHG
issues, within the Sustainability Committee’s Sustainability Strategy Working Group. With a membership that spans multiple areas, from production and purchasing
to corporate planning, the Climate Change Subcommittee considers a variety of themes, including climate change targets and initiatives, and makes proposals to bedeliberated and determined by the Sustainability Committee, which answers directly to the president and CEO.
',&DQG',&*URXSFRPSDQLHVLQ-DSDQKDYHHVWDEOLVKHGDQ(QHUJ\6DYLQJ3URPRWLRQ&RPPLWWHHDWHDFKVLWH&RPPLWWHHDFWLYLWLHVLQFOXGHFRQ¿UPLQJWKHSURJUHVV
of initiatives, engaging in discussions and conducting patrols. An Energy-Saving Working Group has also been set up at each site that comprises members chosen by
the site itself, to foster the exchange of information and research pertaining to new items, as well as to promote the horizontal deployment of effective measures acrossthe Group. This combination of site- and Group-level initiatives forms the framework under which the DIC Group endeavors to reduce its CO emissions. Overseas,
DIC Group companies promote a wide range of independent energy-saving initiatives that align with related Group policies. The Production Management Unit provides
support on multiple fronts, including the deployment of management systems and the training of employees.

DIC Report 2022 ̲68

Data| Efforts to Prevent Global Warming

| Disclosures in Line with TCFD Recommendations
With the aim of helping institutional investors grasp climate-related risks and opportunities and make investment decisions, the Task Force on Climate-related
Financial Disclosures (TCFD) has structured its recommendations around four thematic areas that represent core elements of how organizations operate—
governance, strategy, risk management, and metrics and targets.
1

Governance

The DIC Group recognizes climate change as a key management challenge. Important matters, including the setting of medium- and long-term targets for the reductionof CO emissions, are deliberated and determined by the Sustainability Committee, which meets four times annually and answers directly to the president and CEO, andthe details are reported to the Board of Directors, in line with the rules governing the Board of Directors. (In principle, the Sustainability Committee reports to the Board of
Directors on all of its deliberations.) A system is thus in place that ensures appropriate supervision of the Sustainability Committee is provided by the Board of Directors.

Value Creation Essentials

2

Strategy

DIC is promoting sustainable business strategies, recognizing the importance of risks and opportunities associated with climate change. Because theimpacts of climate change are likely to surface over the medium to long term, the Company is working to enhance its understanding of the principal
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VFHQDULRDQDO\VLVFRQGXFWHGLQ¿VFDO\HDUWKH&RPSDQ\ZLOOZRUNWRUDLVHLWVDZDUHQHVVRIIRUHVHHDEOHRSSRUWXQLWLHVDQGULVNVIURPDPHGLXPWR
long-term perspective and at the same time to formulate and execute effective strategies on an appropriate time line.

Strategies for Reducing CO2 Emissions
As a company with a CO emissions reduction target, the DIC Group will promote a variety of related initiatives as outlined below.
CO2 Emissions by the Global DIC Group (Scope 1 and 2)

Initiatives Aimed at Reducing CO 2 Emissions

Internal emissions reduction initiatives (Scope 1 and 2)

Value Creation Cornerstones

Value Creation Strategies

z Advance environmental investments, process
improvements and energy-saving initiativesz Advance the electrification of production equipmentz Actively employ green power generationz Introduce an internal carbon pricing system

Emissions reduction initiatives across the supply chain(Scope 3)Group,z Promote supplier engagementz Encourage the use of recycled and bioderived raw materials
z Increase the recycling rates of and reduce the disposal of usedproducts by customers
z Leverage proprietary technologies to improve the efficiency ofmaterials recyclingz Contribute to reduction through business activities

Initiatives for Fiscal Years 2020–2022● Introduce internal carbon pricing.
● Promote full-scale collaboration with FP Corporation (FPCO) in the practical implementation of a closed-loop recycling system for polystyrene, used in plastic

containers for food products, among others.
● (VWDEOLVKWKH&OLPDWH&KDQJH6XEFRPPLWWHHLPSOHPHQWYDULRXVPHDVXUHVDQGDQQRXQFHQHZWDUJHWVIRUDFKLHYLQJFDUERQQHXWUDOLW\E\¿VFDO\HDU
● 5DLVHIXQGVE\LVVXLQJVXVWDLQDELOLW\OLQNHGERQGV 6/%V ● Build net zero energy business (ZEBs).

Data● Embark on efforts to reduce the carbon footprint of products.
3 Risk Management

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DIC recognizes risks related to its response to climate change—a key component of its framework of sustainability themes, the foundation of its
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submitted for consideration to the Sustainability Committee.
4

Metrics and Targets

In light of accelerated global efforts to decarbonize, the DIC Group has set new targets for the reduction of its CO  emissions and pledged to step up
related efforts. DIC now aims to achieve carbon neutrality—net zero COHPLVVLRQV²E\¿VFDO\HDUDQGZLOOVHHNWRUHGXFH&2HPLVVLRQVE\
IURPWKH¿VFDO\HDUOHYHOE\¿VFDO\HDU7KH*URXSZLOOFRQWLQXHWRGLVFORVHWKHUHVXOWVRILWVYDULRXVLQLWLDWLYHVDQGREWDLQWKLUGSDUW\YHUL¿FDWLRQ
of its CO emissions data.
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69̲ DIC Report 2022

| Principal Initiatives in Fiscal Year 2021

Emissions(Tonnes)

Production volume(Tonnes)

800,000

3,000,000

700,000

2,500,000

600,000
2,000,000

500,000

1,500,000

400,000
300,000

Grasping CO2 Emissions Across the Supply Chain (Scope 3)

The DIC Group recognizes the importance of reducing emissionsof greenhouse gases across its supply chain and works to ensure a
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Adoption of Renewable Energy by the DIC Group Overseas

Against a global trend toward decarbonization, including by
popularizing the use of renewable energy, DIC Group companies
in the Asia–Pacific region, Greater China, and the Americas andEurope are making use of government subsidies and support to, forexample, install biomass boilers and solar power facilities.
,Q¿VFDO\HDUWKHJOREDO',&*URXSXVHGDWRWDORI*RIUHQHZDEOHHQHUJ\DQLQFUHDVHRIIURP*-LQ¿VFDO\HDU7KHXVHRIUHQHZDEOHHQHUJ\DFFRXQWHGIRUDUHGXFWLRQ
in the Group’s global COHPLVVLRQVRIWRQQHV

Quality

1,000,000

200,000
500,000

100,000
0

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Production volume

CO2 emissions

0

Reduction of CO2 emissions (target)

Greenhouse Gas Emissions in Fiscal Year 2021
Category
NumberCategory

Emissions

Purchased goods and services



Capital goods



Fuel- and energy-related activities
QRWLQFOXGHGLQ6FRSHRU



4

Upstream transportation and distribution



Waste generated in operations

6

Business travel



7

Employee commutingEnd-of-life treatment of sold product



QR codeEnhancing Product Quality and Customer Satisfaction
https://www.dic-global.com/en/csr/quality/

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&RPSDQ\ODXQFKHGDQHZFRQ¿JXUDWLRQLQZKLFKWKHSURGXFWGLYLVLRQTXDOLW\DVVXUDQFHJURXSVKDYHEHHQDEVRUEHGLQWRWKH3URGXFWLRQ0DQDJHPHQW
Unit. This realignment also involved creating the position of deputy general manager in charge of quality control within the Production Management
Unit and integrating the quality assurance groups, previously divided among the product divisions. The goals here were to ensure the independenceof the framework for promoting quality assurance to ensure customers’ quality requirements; clarify the roles of quality control and quality assurance,
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4XDOLW\&RQWURO'HSDUWPHQWXVLQJWKHLUUHVSHFWLYHUHSRUWLQJOLQHVWRLGHQWLI\LVVXHVIDFLQJVLWHVDQGSURGXFWGLYLVLRQVDQGGHYLVHWKHPRVWHIIHFWLYH
measures in response.
',&DOVRHVWDEOLVKHGDQHZ4XDOLW\&RPPLWWHHWRHQDEOHWKHSUHVLGHQWWREHGLUHFWO\LQYROYHGLQTXDOLW\PDQDJHPHQW )RUPRUHLQIRUPDWLRQSOHDVH
VHHSDJH ,QSULQFLSOHWKH4XDOLW\&RPPLWWHHPHHWVRQFHHDFKTXDUWHUWRIRUPXODWH',&*URXSTXDOLW\SROLFLHVDQGLPSRUWDQWTXDOLW\PDQDJHPHQW
measures. At committee meetings, the product division general managers and unit heads are responsible for reporting on the status and progress ofquality management measures and summarizing related activities. An especially regrettable incident in the period under review involved the temporary
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address as a Companywide issue by formulating priority strategies.*
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who have many opportunities to communicate with customers. Additionally, an e-learning program on quality compliance was conducted for domestic DIC*URXSHPSOR\HHVZLWKRIHOLJLEOHHPSOR\HHVWDNLQJSDUWWRUDLVHDZDUHQHVVRIWKHFDXVHVRIFRPSOLDQFHYLRODWLRQVDQGSUHYHQWUHFXUUHQFH*RLQJ
forward, the Group will expand training designed to give employees a greater sense of ownership over their own work.
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DIC Report 2022 ̲70

Value Creation Essentials

2

Value Creation Strategies(QHUJ\FRQVXPSWLRQE\WKHJOREDO',&*URXSLQILVFDO\HDU
HGJHGXSIURP¿VFDO\HDUDQGIURPWKH¿VFDO\HDUEDVH\HDU&2 emissions by the global DIC Group amounted
WRWRQQHVGRZQIURP¿VFDO\HDUDQGIURP¿VFDO\HDUZKLOH&2 emissions per unit of production (ScopeDQG DWNJWRQQHZHUHGRZQIURP¿VFDO\HDU
DQGIURPWKHEDVH\HDU

Global CO2 Emissions (Scope 1 and 2): Results,
Forecasts and Target for Fiscal Year 2030

Value Creation Cornerstones

Energy Consumption and CO2 Emissions(Scope 1 and 2) by the Global DIC Group

Data

1

Human Resources Management

SDGs Goals 3, 4, 5, 8 and 10
QR codeWorking to Enhance Job Satisfaction

https://www.dic-global.com/en/csr/stakeholder/staff.html

1. Efforts to Strengthen Management of Human Capital
In line with The DIC Way, which represents its fundamental management policy, DIC in Japan works with regional headquarters overseeing operations
in Greater China, the Asia–Pacific region, and the Americas, Europe and Africa to promote the effective management of human resources. The
DIC Vision 2030 long-term management plan, announced in February 2022, recognizes human resources as capital that is crucial to the executionof management strategies. In this plan, the Company identifies three strategic priorities for building a strategic human resources portfolio thatmaximizes the value of human capital—“Foster human resources,” “Ensure mobility (hiring, retention and succession)” and “Improve engagement
and organizational cohesiveness”—and calls for the building of a personnel management platform that underpins these priorities through framework
creation, risk management and efforts to enhance its corporate culture.
DIC Vision 2030: Three Strategic Priorities and a Personnel Management Platform
Three strategic priorities
Foster human resourcesz Global-based talent management and leadershiptrainingz Promote reskilling to maximize human resources

Value Creation Strategies

Value Creation Essentials

1 Building a Strategic Human Resources Portfolio that Maximizes the Value of Human Capital

Ensure mobility (hiring, retention and succession)z Actively recruit people from different industries andpeople with digital capabilities
z Achieve optimal balance between specialists andgeneralistsz Succession planning

Improve engagement and organizational cohesivenessz Promote communication and use empathy and trust to
cultivate solidarity
z Advance innovation by encouraging enthusiasm about
taking on challenges

Personnel management platform
Framework creation: Global HR system

Risk management: Safety and compliance‫ ٴ‬Facilitate autonomous, multitrack career building‫ ٴ‬Ensure occupational health and safety, and appropriate labor practices‫ ٴ‬Adopt global HR system to create standardized Group framework‫ ٴ‬Improve compliance and reinforce HR governance

Enhance corporate culture: Value diversity and inclusion‫ ٴ‬Promote diversity, recognizing it as a source of competitiveness‫ ٴ‬Nurture inclusion, recognizing it as essential to making diversity a competitive advantage

Data

Value Creation Cornerstones

Work style reform: Bolster job satisfaction and productivity‫ ٴ‬Implement reforms designed to increase job satisfaction, as well as workplace reforms and process reforms that reinforce productivity.

2

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LQZKLFKDOOHPSOR\HHVZLOOSDUWLFLSDWH7KHUDSLGDGYDQFHRIGLJLWDOL]DWLRQWRJHWKHUZLWKWKHDGYHQWRI&29,'DQGSURMHFWLRQVIRUWKH
SRVWSDQGHPLF³QHZQRUPDO´KDYHKLJKOLJKWHGWKHQHHGWRUHYDPSZRUNVW\OHVWRHQVXUHMREVDWLVIDFWLRQDQGSURGXFWLYLW\DWDVNWRZKLFK',&H[HFXWLYHVKDYHFRPPLWWHGWKHPVHOYHV:LWKWKHVKLIWWRFRPPLWWHHVWDWXVWKHSURMHFW¶VH[LVWLQJZRUNLQJJURXSVKDYHEHHQUHDOLJQHGWRFUHDWHWKH-RE6DWLVIDFWLRQ,PSURYHPHQW5HIRUP:RUNSODFH5HIRUPDQG3URFHVV5HIRUPZRUNLQJJURXSVDIUDPHZRUNXQGHUZKLFKexecutives will work as one to promote decisive measures.
3

Basic Personnel Statistics (DIC)

Male
Number of
employees

FemaleOverallMale

Average age

FemaleOverall

Averageyears ofemployment

New
graduates
hired

Male
FemaleOverallMale
FemaleOverallFiscal year 2019

Fiscal year 2020

Fiscal year 2021

Fiscal year 2019

Fiscal year 2020

Fiscal year 2021

2,640
681
3,321
42.6
42.1
42.5
18.3
19.8
18.6
44
22
66

2,669
691
3,360
42.7
42.5
42.7
18.3
20.1
18.6
56
22
78

2,659
686
3,345
42.9
42.8
42.8
18.2
20.2
18.6
40
18
58

()LVFDO\HDUKLUHV)()LVFDO\HDUKLUHV)()LVFDO\HDUKLUHV)

Retention rate
(after three
years)

Male
FemaleOverallMid-career hires(percentage of
total new hires)
Separations(voluntary)(number ofindividuals)

Male
FemaleOverallMale
FemaleOverallMale

Separation rate(voluntary)

FemaleOverall

97.2%
76.9%
91.8%
71
10
44.9%
45
16
61
1.7%
2.3%
1.8%

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71̲ DIC Report 2022

92.3%
100%
94.0%
52
3
41.4%
33
16
49
1.2%
2.3%
1.5%

93.0%
90.0%
92.1%
64
7
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54
12
66
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2. Three Priority Strategies
1 Foster Human Resources

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global talent management committee and establishing selection and monitoring processes for high-potential employees.
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3. Personnel and Global Human Resources Systems
Promote Personnel System Reforms to Facilitate Autonomous, Multitrack Career Building,Q-DQXDU\',&UHYLVHGLWVSHUVRQQHOV\VWHPIRUERWKPDQDJHPHQWOHYHODQGUHJXODUHPSOR\HHVZLWKWKHREMHFWLYHRIHQKDQFLQJRUJDQL]DWLRQDO
capabilities to support the advance of qualitative reforms in existing core businesses and the successful commercialization of new businesses. In
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and productivity, encourage a performance- and challenge-oriented focus, and support career building, in line with which it dramatically revamped its
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Create a Global Human Resources System and a Standardized Group Framework
With the rapid expansion of its global operations, DIC recognizes that securing and fostering human resources around the world and ensuring the rightpeople are in the right places across the DIC Group are essential to bolstering the value of Group human capital and effectively carrying out management
strategies, and has sought to integrate global human resources management. To this end, the Company has promoted the adoption of harmonized
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management-level—i.e., manager and above—employees, replacing traditional ability-based standards with role-based standards.

4. Diversity and Inclusion
Promoting Diversity, a Source of DIC’s Competitiveness, and Inclusion, Essential to Making Diversity a Competitive Advantage

The DIC Group actively pursues diversity by employing a broad spectrum of individuals without regard to such considerations as gender,
nationality, physical limitation or age. The Group works to foster a corporate culture that draws on its understanding and respect for diversity to
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is promoting measures to encourage communication and providing career support, thereby fostering a sense of unity through empathy and trust
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1

Hiring Foreign Nationals:LWKWKHREMHFWLYHRIVHFXULQJWDOHQWHGLQGLYLGXDOVZLWKDGYDQFHGVSHFLDOL]HGFDSDELOLWLHVJOREDOSHUVSHFWLYHVDQGODQJXDJHFDSDELOLWLHV',&DFWLYHO\promotes the hiring of international students completing undergraduate or graduate studies at Japanese universities, as well as Japanese and foreign
nationals who are completing undergraduate studies at overseas universities or have extensive specialized experience and expertise. At present, 43
foreign nationals are employed in various capacities at DIC. To support the careers of employees who are foreign nationals, DIC translates key in-housematerials into English. The Company also holds networking conferences to foster ties among non-Japanese employees and provide information on the
personnel system, employment conditions and efforts to improve workplace environments.

DIC Report 2022 ̲72

Value Creation Strategies,Q¿VFDO\HDU',&FRQGXFWHGDVXUYH\RIGRPHVWLF*URXSFRPSDQLHVDVSDUWRIWKH:65SURMHFW¶VHIIRUWVWRLPSURYHHQJDJHPHQWDQG
organizational cohesiveness. Based on the results, the Company explored a variety of responses designed to foster a sense of solidarity and advanceinnovation, resolving to implement the formalization of a system of one-on-one meetings to improve engagement, as well as to introduce a system
whereby points are added to the evaluations of people taking on challenges in their work.

Value Creation Cornerstones

3 Improve Engagement and Organizational Cohesiveness

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recognizes the need to create a human resources system that bolsters mobility within the Group, enabling employees to fully exercise their abilities
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Value Creation Essentials

2 Ensure Mobility

VOICE I look forward to helping address social imperatives with a desire to grow personally and take on new challenges.
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for foreign nationals, as well as for female employees striving to balance the demands of their career and childcare. The revision of the personnel system has also
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Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

2

Xin Zhou

DIC Recognized as Nadeshiko Brand for Fiscal Year 2021, Earning Selection for the Fourth Consecutive YearIn recognition of its superb achievement in expanding career opportunities for
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chemicals sector.

3

Advancing the Employment of Individuals with Disabilities',&LVFRPPLWWHGWRFUHDWLQJLQFOXVLYHZRUNHQYLURQPHQWVWKDWKHOSLQGLYLGXDOVZLWKGLVDELOLWLHVHQMR\DFWLYHDQGIXO¿OOLQJFDUHHUV2QHLQLWLDWLYHLV
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5. Respect for Human Rights
The DIC Group actively supports global codes governing human rights,*LQOLQHZLWKZKLFKLQ¿VFDO\HDULWIRUPXODWHGWKH',&*URXS+XPDQ5LJKWV3ROLF\DQGEHJDQSURPRWLQJUHODWHGLQLWLDWLYHV7KH',&*URXS&RGHRI%XVLQHVV&RQGXFWZKLFKRXWOLQHVVWDQGDUGVWKDWDIC Group employees are expected to observe, lays down provisions prohibiting human rights violations and requiring respect for diversity,
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written pledges to abide by the code.
,Q¿VFDO\HDU',&EHFDPHDVLJQDWRU\WRWKH81*&SOHGJLQJLWVVXSSRUWIRUWKH7HQ3ULQFLSOHVRIWKH81*&ZKLFKLQFOXGHVWHQHWVUHJDUGLQJKXPDQrights and labor. The Company continues to implement related initiatives in all areas of its corporate activities to reinforce respect for human rights in thehuman resources management practices of all Group companies and prevent the occurrence of violations.
,QUHVSRQVHWRWKH0RGHUQ6ODYHU\$FW 2 DIC is reinforcing training regarding human rights due diligence,*3FRJQL]DQWRIWKHLVVXHRIKXPDQWUDI¿FNLQJ
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*2 8QGHUWKH0RGHUQ6ODYHU\$FWDQ$FWRIWKH3DUOLDPHQWRIWKH8QLWHG.LQJGRPFRPSDQLHVZLWKRSHUDWLRQVLQWKH8QLWHG.LQJGRPPXVWUHSRUWRQWKHH[LVWHQFHQRQH[LVWHQFHRIVODYHU\KXPDQWUDI¿FNLQJRURWKHUFULWLFDOYLRODWLRQVRIKXPDQULJKWVLQWKHLUVXSSO\FKDLQVUHODWHGULVNVDQGVWHSVWKH\DUHWDNLQJWRDGGUHVVVXFKSUDFWLFHV³0RGHUQVODYHU\´HQFRPSDVVHVGHEWERQGDJHIRUFHGODERUDQGVHUYLWXGHKXPDQWUDI¿FNLQJDQGH[SORLWDWLRQ LQFOXGLQJVH[XDO
exploitation and forced organ donation).
*3 Human rights due diligence is an ongoing risk management process that a company needs to follow in order to identify, prevent, mitigate and account for how it addresses its adverse human rights impacts.

Initiatives in Fiscal Year 2021

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consider in order to curb the manifestation of risks.

6. Work–Life Balance/Safety and Health
1 Work–Life Balance
DIC views a healthy work–life balance as essential to both self-realization and sustainable corporate growth. Accordingly, from the standpoint ofcorporate health management,* the Company continues to expand systems intended to facilitate such a balance. In response to falling birthrates, theJapanese government has launched a drive to promote work style reform, with the goal of helping individuals balance the demands of their careers

73̲ DIC Report 2022

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that positive workplaces lead to higher productivity.
* An approach to employee health management that emphasizes a corporate management perspective and the implementation of strategic measures.

① Enhancing Programs that Help Employees Balance the Demands of Work and Home

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initiatives designed to assist employees in raising children. The Company has also deployed a system thatJLYHVUHJXODUHPSOR\HHVWKHRSWLRQWRDFFHSWRUUHIXVHWUDQVIHUVUHTXLULQJUHORFDWLRQDQGVLQFHD
system that allows management-level employees to limit the locations to which they will accept transfers,
making it easier for individuals who are unable to accept transfers that involve relocation because ofchildbirth, childcare, nursing care or other responsibilities.

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actively promote initiatives
designed to assist with child
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③ Introducing a Leave to Accompany Spouse Overseas System

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allowing employees to take leave to accompany spouses on overseas work assignments. This system helps employees balance their careers and private
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2

Employee Safety

Measures to Prevent the Spread of COVID-19%HWZHHQ)HEUXDU\ZKHQ&29,'¿UVWHPHUJHGDQG'HFHPEHUDWRWDORILQWHUQDOQRWL¿FDWLRQVZHUHVHQWXQGHUWKHKHDGLQJ³0HDVXUHVWR3UHYHQWWKH6SUHDGRI&29,'´(IIRUWVUDQJHGIURPSURPRWLQJLQWHUQDOLQLWLDWLYHVWRSUHYHQWLQIHFWLRQWRGHWDLOHGLQVWUXFWLRQVUHJDUGLQJLQGLYLGXDOHPSOR\HHEHKDYLRU
3 Corporate Health Management

Value Creation Strategies

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execution of duties and enhancing self-management capabilities.

Value Creation Essentials② 6LJQLÀFDQWO\([SDQGLQJWKH)OH[WLPH6\VWHP

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program, which seeks to shine a spotlight on outstanding enterprises working to advance health and productivity management, creating an environment that ensures
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employee health and productivity from a management perspective and promote strategic initiatives.
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program assesses performance based on grasp of employee health–related issues and consideration of actions, establishment of a foundation for the practicalimplementation of health and productivity management measures and work engagement,*2 promotion of efforts to help ensure the physical and mental health of
employees, quality of initiatives, and evaluation and improvement.
DIC will continue to implement measures designed to promote physical and mental health as part of its commitment to creating work environments that empower
employees to reach their full potential.
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ensure sound medical services in Japan.
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Data

In line with its Health Management Declaration, the DIC Group works actively to support the physical and mental health of its employees, as well as to
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measures, recognizing that the health of its employees is essential to the realization of sustainable growth.

Value Creation Cornerstones

Corporate Health Management Initiatives

Sustainable Procurement

SDGs Goal 12
QR codePromoting Socially Responsible Procurement Across the Supply Chain
WEB

https://www.dic-global.com/en/csr/stakeholder/partner.html| Encouraging Sustainable Procurement

Value Creation Essentials

Having recognized the increasing importance of addressing global issues related to human rights, climate change and water risk, among others,
as social imperatives, the DIC Group promotes socially responsible procurement practices. To ensure its extended supply chain functions ina socially responsible manner, in 2008 the Group established the DIC Group Universal Purchasing Policy, based on which it later formulated
purchasing management regulations and clarified issues it expects suppliers to address. Using the DIC Group Sustainable Procurement
Guidebook, revised in February 2020, the Group promotes sustainable procurement across its supply chain by ensuring that all suppliers
LPSOHPHQWLPSURYHPHQWVDQGLQLWLDWLYHVDVQHFHVVDU\*URXSFRPSDQLHVLQ-DSDQWKH$PHULFDVDQG(XURSH*UHDWHU&KLQDDQGWKH$VLD±3DFL¿Fregion collaborate to ensure sustainable procurement on a global basis.

The DIC Group Universal Purchasing Policy
Guided by an action policy established to realize the DIC Group’s basic sustainable procurement
principles, the Purchasing Department adheres to the following guidelines in dealing with suppliers:❶ Fair and transparent business practices

Data

Value Creation Cornerstones

Value Creation Strategies

The DIC Group will implement fair and open purchasing activities with suppliers based on global
perspectives, without the constraints of conventional commercial customs.
❷ An appropriate purchasing process and the building of relationships of mutual trust

The DIC Group, as a good partner for suppliers, will build long-lasting, mutually trusted relationships with
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❸ Satisfying environmental/safety needs

The DIC Group will take responsibility as an exemplary corporate citizen for environmental affairs,
occupational safety, human health and product quality, always take into account changes in society andimplement environment-friendly purchasing activities.

The DIC Group Sustainable
Procurement Guidelines❶ Compliance with laws/social norms❷ Human rights and work environments❸ Safety and health❹ Consideration for the environment❺ Information security❻ Appropriate quality and safety and technologicalimprovements❼ 6WDEOHVXSSOLHVDQGÀH[LEOHUHVSRQVHVWRFKDQJH❽ Promotion of sustainability and sustainableprocurement initiatives❹ Challenge the creation of new value

In order to respond at a high level to a new value sought by society, the DIC Group will proactively
challenge the creation of such value together with suppliers, with whom the same goal can be shared,
and strive to grow together with them in a sustainable manner.

| Supplier Self-Evaluations
In accordance with the DIC Group Sustainable Procurement Guidebook, the DIC Group asks suppliers to evaluate themselves by completing
a questionnaire, which it uses to ascertain the status of suppliers’ sustainable procurement practices. The questionnaire further segments the*URXS¶VHLJKWSURFXUHPHQWJXLGHOLQHVLQWRLVVXHVLQFOXGLQJFRQVLGHUDWLRQIRUKXPDQULJKWVDQGZRUNHQYLURQPHQWVDFTXLVLWLRQRIFHUWL¿FDWLRQ
under ISO 14001, implementation of green procurement and promotion of sustainable procurement to secondary suppliers.

| Analyzing the Results of Questionnaires
Between June 2020 and February 2022, the DIC Group used version 3 of the DIC Group Sustainable
Procurement Guidebook, which was published in February 2020, to conduct assessments for 348
suppliers, accounting for more than 70% of its procurement spending. In addition to analyzing andassessing questionnaire responses, the Group provided feedback and where necessary requested
corrective measures, using written comments or remote interviews because of COVID-19.
Note: Between November 2013 and December 2019, assessments were conducted using version 1 and then version 2 of this guidebook for a
cumulative total of 764 companies.

| Responsible Procurement of Minerals
The DIC Group has formulated a Basic Approach to the Responsible Procurement of Minerals, recognizing
the importance of procuring these critical resources in a responsible manner and engaging with suppliers toaddress this challenge across its supply chain.
Basic Approach to the Responsible Procurement of Minerals

75̲ DIC Report 2022

https://www.dic-global.com/en/csr/stakeholder/conflict.html

Feedback sheet

New Value Creation

SDGs Goals 8, 9 and 11
QR codeCultivating Next-Generation Businesses
WEB

https://www.dic-global.com/en/csr/stakeholder/customer.html| Creating New Value

2

Algae-Derived DHA Oils

3

Data

Algae, which absorbs CO2 and produce useful substances through photosynthesis, is attracting more and more attention against a backdrop of evolving requirements forcompanies to ensure sustainability, notably the need to achieve carbon neutrality and reduce consumption of petroleum-derived resources. The DIC Group recently signed asales agency contract with Fermentalg S.A., a leader in the development of microalgae-derived food ingredients based in Libourne, France, and in July 2021 began marketing
Fermentalg’s DHA ORIGINS™-510 series of highly concentrated docosahexaenoic acid (DHA) oils, which are derived from a proprietary microalgae strain (Schizochytriumsp.), for use in dietary supplements.
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deliver safety and peace of mind. In addition, they comply with both the European Union’s Novel Food safety standards and the U.S. Food and Drug Administration’s Generally
Recognized as Safe (GRAS) standards.
Grown in a clean environment using Fermentalg’s outstanding technology for cultivating Schizochytrium spLQIHUPHQWDWLRQWDQNVHOLPLQDWLQJWKHLQÀXHQFHRIFOLPDWHDQGWKHULVN
of contamination, DHA ORIGINSSURGXFWVUHDOL]HKLJKO\FRQFHQWUDWHG  '+$ZLWKRXWDQ\DUWL¿FLDOFRQFHQWUDWLRQSURFHVVHV7KH',&*URXSZLOOFRQWLQXHWRUHLQIRUFHLWV
algae cultivation technologies as part of its commitment to contributing to the realization of a sustainable society and an improved QOL for people everywhere.
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fabricating wiring on high-frequency printed wiring boards (PWBs) that enables the formation of extremely smooth diagonal and vertical wiring.
This new film was developed by DIC and Taiyo Ink as a new application for DIC’s metallic nanoparticles in the fabrication of flexible PWBs. The metallic
nanoparticle-coated film is used as a conductive seed layer in theformation of copper wiring using a semi-additive process. This ensuresthe copper wiring adheres extremely evenly and that the pattern can
EHHWFKHGZLWKRXWWKLQQLQJ7KLVOHDYHVD¿QHO\SDWWHUQHGH[WUHPHO\smooth surface, greatly reducing transmission loss in high-frequency
bands. DIC looks forward to providing an increasing variety of highperformance films that contribute to the realization of a high-speed,
1,000× 10.0μm
high-capacity communications infrastructure.
New seed film for fabricating wiring on high-frequency PWBs

Value Creation Strategies

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rapidly around the world. In Japan, a new Plastic Resource Recycling Promotion Law came into force on April 1, 2022, a development that is expected to further accelerate
the drive to realize sustainable plastics.
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Value Creation Cornerstones

1

Value Creation Essentials

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innovation, improving the human condition and promoting stability for a brighter future. Seeing its mission as being to achieve sustainable growth for itself and society, the*URXSLVSXUVXLQJYDULRXVLQLWLDWLYHVDLPHGDWKHOSLQJUHDOL]HFDUERQQHXWUDOLW\LQOLQHZLWKLWVEDVLFSROLF\RISURYLGLQJJUHDWHUVRFLDOEHQH¿WVWKDWHQKDQFHVKDUHKROGHUYDOXH
and build long-term corporate value.
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by expanding businesses in growth markets and creating new businesses to promote portfolio transformation. Through the initiatives set forth in the plan, the Group pledges
to contribute to the creation of a society that is increasingly green, digital and QOL-oriented.

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DIC Report 2022 ̲76

Sustainable Technology and Product Development

SDGs Goals 9 and 12
QR codeProposing Solutions that Leverage Core Technologies
WEB

https://www.dic-global.com/en/csr/new_technology/| Achieving Sustainable Growth

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LQVWLWXWLRQVDQGFRUSRUDWHYHQWXUHFDSLWDO &9& WRGULYHVXVWDLQDEOHJURZWK| Enhancing the Technology Platform
Accelerating portfolio transformation, by combining basic technologies—including recently added inorganic materials design
and biomaterials design technologies—with AI and MI&XUUHQW%DVLF7HFKQRORJLHVValue Creation Strategies

Biomaterials
designOrganic
materials
designOptics andcolor

Polymer
designInorganic
materials
designInorganic
materials
designBiomaterials
designValue Creation Cornerstones

Common basic
technologies

Dispersion

Computational science(AI and MI), Analysis

Dispersion

Applicability
assessment

Polymer
designAI and MI

Organic
materials
designApplicability
assessment

Data

Optics andcolor(Coating,
printing,
molding)(Coating, printing, molding)

DIC’s rich lineup of basic technologies is
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Processing Technical Group 2, Processing Technical Division, DIC Corporation

77̲ DIC Report 2022

Daisuke Watanabe

Digital Transformation (DX)QR codeDriving Business Model and Portfolio Transformation
WEB

https://www.dic-global.com/en/csr/philosophy/digital_transformation.html

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| Framework for Promotion
Framework for Promoting DX
Board of Directors

WSR Committee
ReportTrace, provide support for and conductpost-implementation monitoring of DX initiatives

IT Strategy Unit
Information Systems Department
DX Promotion Department

Value Creation Essentials

President and CEO| Market
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| Core Business Systems
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Data

| SCM

Harmony with the Community and Social Contributions

SDGs Goals 3 and 4
QR codeAdding Color & Comfort to Lifestyles
https://www.dic-global.com/en/csr/society/

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

Visiting Science Lab Program
In line with the Japanese government’s efforts to promote career education initiatives, as well as to help curb a decline in the popularity of science among children, DIC and DIC Graphics
conduct visiting science labs at public elementary schools. Through this program, the DIC Group seeks to spark children’s interest in science and encourage them to realize the close
relationship between science and their everyday lives.
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and 2019, the Group also conducted visiting science labs for elementary school children as part of the Tohoku University Graduate
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Initiatives Led by the Central Research Laboratories

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Initiatives Led by the Kashima Plant
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practical training at the plant, over a period of three months.
Kawamura Memorial DIC Museum of Art
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times a year to promote a deeper understanding of the works in its collection.
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works from its collection. The museum will also promote social contribution activities and enhance its digital presence with a view toencouraging communication with the community.

Matching Gift Program
DIC has a matching gift program in Japan whereby it matches the total amount collected through an annual year-end fundraising drive spearheaded by its employees’ union.
Funds raised through the 2021 drive and matching gift program were donated to 19 children’s homes and facilities providing support for disabled individuals.

79̲ DIC Report 2022

Communication with Stakeholders

SDGs Goal 17
QR codePromoting Disclosure and Communication
https://www.dic-global.com/en/csr/stakeholder/

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Article 8 (Ensuring Appropriate Information Disclosure and Transparency)

Ties with society

Ties with employees

Ties with the media

Build trusting relationships. By
incorporating the demands ofcustomers, seek to develop
products that enhancecustomer satisfaction.

( Q V X U H  D S S U R S U L D W Hdisclosure and build
trusting relationships withshareholders and investors,
encouraging both toevaluate DIC as an attractive
investment.

Promote socially responsible
procurement across the
supply chain and build solid
relationships that will facilitatesustainable procurement.

Operate in harmony withthe community and build
positive relationships withlocal residents that will
underpin the long-termsustainability of operations.

Provide workplaces that are
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and enable all employeesWRIXO¿OOWKHLUSRWHQWLDO2YHU
the long term, achieve true
diversity.

Deepen understanding
through effective publicity,
advertising and othercommunications efforts.

Basic approach● Websites● Product pamphlets● Digital marketing● Corporate profile DVDs
● DIC Report● Corporate PR film
● News releases● Television advertisements● Websites● Press conferences● Quarterly results● ',&*URXS6XVWDLQDEOH3URFXUHPHQW

● Better Tomorrows●Yuka Shoken Hokokusho● 6XSSOLHUsustainable procurement● Websites● 6LWHUHSRUWV● &RUSRUDWHSUR¿OH'9'V● DIC Report● News releases● Television advertisements● Press conferences● Interviews with
MRXUQDOLVWV● DIC Report● News releases● Television
advertisements

Communications
tools● Production facility tours● 3DUWLFLSDWLRQLQSURMHFWVLQYROYLQJ

● /DERU±PDQDJHPHQWFRXQFLOV● Results presentations

announcements(¿QDQFLDOGLVFORVXUHGRFXPHQWUHTXLUHG
of listed companies in Japan)● Timely disclosure● Notice of Convocation of WKH$QQXDO*HQHUDO0HHWLQJ RI6KDUHKROGHUV● 6KDUHKROGHUQHZVOHWWHUV● &RUSRUDWHSUR¿OH'9'V

Guidelines● DIC Group Green Procurement

Guidelines

questionnaires● Feedback sheets● &RQÀLFW0LQHUDOV5HSRUWLQJ

Template● DIC Report(digital in-house newsletter)● Intranet● DIC Pocket Book LQKRXVH*URXSGDWD¿OH ● DIC Report● Corporate PR film
● News releases● Television
advertisements● Global linkage● Branding questionnaire● DIC Report● News releases● Television advertisements● 6DOHVDFWLYLWLHV● Participation in

Opportunities forcommunication

exhibitions● /HFWXUHVRQWKH6'*Vfor customers

Ties with
Customers● $QQXDO*HQHUDOPHHWLQJ

of shareholders’● Results presentations● IR conferences● IR meetings● DIC IR Day● ,QGLYLGXDOLQYHVWRUEULH¿QJV● (6*SUHVHQWDWLRQV● On-site inquiries

collaboration among industrial
concerns, government bodies andacademic institutions● Participation in community events● (QYLURQPHQWDOPRQLWRULQJ● Plant Bon Odori

for employees● Presentations on the DIC Group● Newspapers● (FRQRPLFSXEOLFDWLRQV● Industry publications

Code of Business Conduct● 6XVWDLQDELOLW\SUHVHQWDWLRQV● DIC Family Day● Plant tours for employee families● Caravan workshops

Ties withSociety

Value Creation Strategies

Ties withbusiness
partners

Value Creation Cornerstones

Ties withshareholders
and investors

Ties with customers

Value Creation Essentials

7KH &RPSDQ\ VKDOO HQVXUH WUDQVSDUHQF\ DQG IDLUQHVV DQG LQ RUGHU WR JDLQ WKH FRUUHFW XQGHUVWDQGLQJ DQG WUXVW IURPstakeholders, shall timely and appropriately disclose information relating to matters such as the DIC Group’s management
philosophy, management policies, business plans, financial condition and sustainability activities.

Ties with theMedia
Press conferences held
LQÀVFDO\HDU

Interviews with journalists
LQÀVFDO\HDU

DIC’s global website
6XVWDLQDEOH0DWHULDO([SRTies with
Shareholders
and Investors(6*SUHVHQWDWLRQ&,7(-DSDQ

DIC Report69

Ties with
Employees)LQDQFLDOUHVXOWVSUHVHQWDWLRQIRUHPSOR\HHVE\SUHVLGHQWDQG&(2.DRUX,QR OHIW 
DQG&)26KXML)XUXWD ULJKWDIC Report 2022 ̲80

Data

83

Financial Report for Fiscal Year 2021
| Analysis of Results of Operations
Overview of Operating Results(Billions of yen)

Value Creation Essentials

FY2020Change (%)

Change(%)

FY2021[Local currency basis]

Net sales

701.2

855.4

22.0%

18.2%

Operating income

39.7

42.9

8.1%

7.1%

Ordinary income

36.5

43.8

20.0%

-

Net income attributable to owners of
the parent

13.2

4.4

-67.0%-EBITDA*

55.6

69.0

24.1%

-

¥/US$1.00 (Average rate)

106.37109.75

3.2%-¥/EUR1.00 (Average rate)

121.43129.73

6.8%

-

Data

Value Creation Cornerstones

Value Creation Strategies* EBITDA = Net income attributable to owners of the parent + Total income taxes + (Interest expenses – Interest income) + Depreciation and amortization,QWKH¿VFDO\HDUHQGHG'HFHPEHUFRQVROLGDWHGQHWVDOHVDGYDQFHGWRELOOLRQ,IWKHUHVXOWVRIWKH& (pigments business (formerly BASF SE’s Colors & Effects business), included in the scope of consolidation since July 2021,
were discounted, the increase would have been 15.3%. With progress in the drive to vaccinate people against COVID-19 andthe effectiveness of vaccinations, the effect of the pandemic on economic activity eased, particularly in developed countries andterritories. Against a backdrop of buoyant digital-related demand worldwide, shipments remained robust, including those of highvalue-added products such as materials for use in semiconductor devices and in electrical and electronics equipment. Shipments
RIPDWHULDOVIRUXVHLQGDLO\QHFHVVLWLHVVXFKDVIRRGSDFNDJLQJVWD\HG¿UPZKLOHWKRVHRISLJPHQWVIRUFRVPHWLFVVKRZHGVLJQVRI
recovering. While certain products and regions continued to feel the brunt of falling automobile production, a result of semiconductor
device shortages, shipments of materials for automotive applications were steady overall.
Operating income, at ¥42.9 billion, was up 8.1%. If the impact of the C&E pigments business was excluded, the gain would havebeen 31.6%. This was despite the impact of elevated raw materials costs, a consequence of rising crude oil prices, among others, andhigher logistics costs, attributable to supply chain stagnation, throughout the period, and was due to solid shipments in all segments,
SDUWLFXODUO\RIKLJKYDOXHDGGHGSURGXFWVDQGRQJRLQJHIIRUWVWRUHGXFHWKHLQÀXHQFHRIHVFDODWLQJFRVWVE\DGMXVWLQJVDOHVSULFHV
1RQHWKHOHVVRSHUDWLQJLQFRPHJURZWKZDVKLQGHUHGE\ÀDJJLQJVDOHVLQWKH& (SLJPHQWVEXVLQHVV²UHÀHFWLQJVKLSPHQWGHOD\V
DWWULEXWDEOHWRWKHIDFWWKDWLWWRRNVRPHWLPHWREXLOGDORJLVWLFVFRQ¿JXUDWLRQIROORZLQJWKHLQWHJUDWLRQRIWKHQHZEXVLQHVV²DVZHOODV
by an increase in operating costs to resolve this business’ logistics-related issues, among others.
2UGLQDU\LQFRPHURVHWRELOOLRQRZLQJWRH[SDQGHGHTXLW\LQHDUQLQJVRIDI¿OLDWHVDQGIRUHLJQH[FKDQJHJDLQVNet income attributable to owners of the parent tumbled 67.0%, to ¥4.4 billion. The principal factor behind this steep decrease was
the reversal of deferred tax assets in the United States and the recording of an equivalent amount as income taxes–deferred, as
detailed in the press release titled “Notice Regarding Revision of Consolidated Operating Results Forecasts for Fiscal Year 2021 andReversal of Deferred Tax Assets,” published on February 7, 2022.
Earnings before interest, taxes, depreciation and amortization (EBITDA) reached ¥69.0 billion, up 24.1%.
Segment Results(Billions of yen)

Net sales

Operating income (loss)

FY2020

FY2021

Change(%)

Packaging & Graphic

388.4

439.8

13.2%

Color & Display

105.8

167.2

Functional Products

236.0

Others, Corporate and eliminations
Total

81̲ DIC Report 2022

Change (%)

Change(%)

Change (%)

FY2020

FY2021

9.8%

21.8

21.6

-0.7%

-0.2%

58.0%

51.7%

8.4

4.0

-53.2%-49.3%

283.3

20.1%

17.1%

17.1

26.2

53.2%

49.4%

(29.0)(34.9)

-

-

(7.6)

(8.9)

-

-

701.2

855.4

22.0%

18.2%

39.7

42.9

8.1%

7.1%

[Local currency basis][Local currency basis]

Packaging & Graphic
Change (%)[Local currency basis]

Net sales¥388.4 billion¥439.8 billion

13.2%

9.8%

Operating income¥21.8 billion¥21.6 billion

-0.7%

-0.2%

Segment sales rose 13.2%, to ¥439.8 billion. In materials for food packaging, sales of packaging inks were bolstered by thecontinued expansion of shipments in the Americas and Europe, and signs of a recovery in demand in Japan. Sales of publication
LQNV ZKLFK FHQWHU RQ LQNV IRU FRPPHUFLDO SULQWLQJ DQG QHZV LQNV ZHUH DOVR XS²GHVSLWH D GHFOLQH LQ GHPDQG IRU WKH IRUPHU
LQ -DSDQ QRWDEO\ IRU SULQWLQJ SDPSKOHWV DQG HYHQWUHODWHG SULQWHG PDWHULDOV²WKDQNV WR KLJKHU VDOHV LQ $VLD EROVWHUHG E\SHUVLVWHQWO\ UREXVW PDUNHW FRQGLWLRQV DQG LQ WKH $PHULFDV DQG (XURSH EDFNHG E\ ILUP GHPDQG 6DOHV RI MHW LQNV IRU GLJLWDO
printing increased sharply, buttressed by brisk sales throughout the year for industrial applications, including outdoor signage(billboards and posters) and banners, and for commercial printing, as well as by the positive impact of the June 2020 acquisition
RIDEXVLQHVVHQJDJHGLQWKHSURGXFWLRQRIMHWLQNVIRUGLJLWDOSULQWLQJRQWH[WLOHV
Segment operating income edged down 0.7%, to ¥21.6 billion. Notwithstanding ongoing efforts to counter the heightened
LQIOXHQFHRIHVFDODWLQJUDZPDWHULDOVFRVWV²DUHVXOWRIULVLQJ UDZPDWHULDOVSULFHV²ZRUOGZLGHRSHUDWLQJLQFRPHZDVGRZQLQ
Japan and Asia, as a consequence of which the overall result remained essentially level with the previous fiscal year.

Color & Display
FY2020Net sales
Operating income

FY2021

Change (%)

Change (%)[Local currency basis]¥105.8 billion¥167.2 billion

58.0%

51.7%

¥8.4 billion¥4.0 billion-53.2%-49.3%

Segment sales climbed 58.0%, to ¥167.2 billion. If the impact of the C&E pigments business was excluded, the increase would havebeen 13.9%. Among existing businesses, sales of color materials rose, as shipments of pigments for cosmetics continued showing
VLJQVRIUHFRYHULQJ,QGLVSOD\PDWHULDOVVDOHVRISLJPHQWVIRUFRORU¿OWHUVZHUHXSZLWKVKLSPHQWVUHPDLQLQJKLJKVXSSRUWHGE\VWHDG\GHPDQGIRUXVHLQOLTXLGFU\VWDOGLVSOD\V /&'V DOWKRXJKVDOHVRIWKLQ¿OPWUDQVLVWRUOLTXLGFU\VWDOV 7)7/&V GHFUHDVHG
RZLQJWRLQWHQVL¿HGFRPSHWLWLRQZLWKPDQXIDFWXUHUVLQWKH3HRSOH¶V5HSXEOLFRI&KLQD 35& ,QSLJPHQWVIRUVSHFLDOW\DSSOLFDWLRQV
sales of effect pigments remained on an uptrend, bolstered by higher demand in Europe for autoclaved aerated concrete for
FRQVWUXFWLRQUHODWHGDSSOLFDWLRQV,QDGGLWLRQWRDPSOL¿HGUHVXOWVLQWKHVHH[LVWLQJEXVLQHVVHVVHJPHQWVDOHVZHUHERRVWHGE\WKH
inclusion of the results of the C&E pigments business. Sales in the C&E pigments business flagged, reflecting shipment delays
attributable to a tight supply–demand situation in the area of maritime shipping arising from a global container shortage, as well as to
WKHIDFWWKDWLWWRRNVRPHWLPHWREXLOGDORJLVWLFVFRQ¿JXUDWLRQIROORZLQJWKHLQWHJUDWLRQRIWKLVQHZEXVLQHVV
Segment operating income fell 53.2%, to ¥4.0 billion. If the impact of the C&E pigments business was disregarded, thiswould have been a gain of 56.8%. Despite a recovery in shipments of pigments for cosmetics and persistently firm shipmentsof high-value-added products such as pigments for color filters and effect pigments, numerous factors, including sluggish sales
in the C&E pigments business, an increase in operating costs to resolve this business’ logistics-related issues and one-timecosts associated with the integration of this business, combined to push operating income down.

Value Creation Essentials

Change (%)

Value Creation Strategies

FY2021

Value Creation Cornerstones

FY2020

FY2020Net sales
Operating income

FY2021

Change (%)

Change (%)[Local currency basis]¥236.0 billion¥283.3 billion

20.1%

17.1%

¥17.1 billion¥26.2 billion

53.2%

49.4%

Segment sales advanced 20.1%, to ¥283.3 billion. Shipments of epoxy resins, the principal application for which is semiconductor
devices, were brisk overall for use as sealing materials in electronics equipment. Shipments of industrial-use tapes, used primarily
LQVPDUWSKRQHVDQGRWKHUPRELOHGHYLFHVZHUH¿UP6DOHVRIDOOHQYLURQPHQWIULHQGO\UHVLQV LQFUHDVHGOHGE\UREXVWVKLSPHQWVRI
products for a wide range of applications, including electrical and electronics equipment, and building materials, although shipments of
FHUWDLQPDWHULDOVIRUXVHLQDXWRPRELOHVLQ$VLDÀDJJHG6DOHVRISRO\SKHQ\OHQHVXO¿GH 336 FRPSRXQGV²XVHVIRUZKLFKFRQWLQXH
WRPXOWLSO\XQGHUSLQQHGE\WKHWUHQGWRZDUGOLJKWHUDQGPRUHHOHFWUL¿HGYHKLFOHV²ZHUHXSLQDOOUHJLRQVDVRUGHUVUHPDLQHGVROLG
particularly in Japan, although concerns remained over the impact of a shortage of semiconductor devices in the automobile industry.
6HJPHQWRSHUDWLQJLQFRPHOHDSWWRELOOLRQ7KLVVKDUSJDLQZDVGHVSLWHHOHYDWHGUDZPDWHULDOVFRVWVDQGUHÀHFWHG
FRQWLQXHGEULVNVKLSPHQWVRIHSR[\UHVLQVDQGRWKHUKLJKYDOXHDGGHGSURGXFWVDQGHIIRUWVWRDGMXVWVDOHVSULFHV* DIC uses the term “environment-friendly resins” to describe strategic resins designed to improve both environmental performance and functionality. These include waterborne, ultraviolet(UV)-curable, polyester, acrylic and polyurethane resins.

DIC Report 2022 ̲82

DataFunctional Products

|Consolidated Financial Statements
Consolidated Balance Sheet

As of December 31, 2020 and 2021

（Millions of yen）

2020

2021

AssetsValue Creation Essentials

Current assets
Cash and deposits

44,88538,253

1RWHVDQGDFFRXQWVUHFHLYDEOH²WUDGH

197,595

237,916

0HUFKDQGLVHDQG¿QLVKHGJRRGV

78,273

132,773

Work in process

9,065

9,651

Raw materials and supplies

55,05891,199Other

24,29436,282

Allowance for doubtful accounts(9,171)(3,959)399,997542,114262,318

288,987

Accumulated depreciation(175,432)(185,949)

Buildings and structures, net

86,885103,039

Machinery, equipment and vehicles

404,451

461,394(337,065)(351,875)

67,386

109,519

7RROVIXUQLWXUHDQG¿[WXUHV

65,312

74,041

Accumulated depreciation(54,844)(59,111)

7RROVIXUQLWXUHDQG¿[WXUHVQHW

10,46814,930Land

51,36264,219Construction in progress

11,977

15,978

Total property, plant and equipment

228,078

307,684

Goodwill

819

20,182

Software

2,963

4,002

Customer-related assets

2,853

3,107

Other

4,877

25,022

Total intangible assets

11,51252,313

Investment securities

57,201

59,289Deferred tax assets

32,407

17,3201HWGH¿QHGEHQH¿WDVVHW

63,78469,715

Other

25,70523,201

Allowance for doubtful accounts

(734)

(156)

Total investments and other assets

178,363

169,370

417,953

529,367

817,950

1,071,481

Total current assets
Non-current assets
Property, plant and equipment

Data

Value Creation Cornerstones

Value Creation Strategies

Buildings and structures

Accumulated depreciation
Machinery, equipment and vehicles, net

Intangible assets

Investments and other assets

Total non-current assets
Total assets

83̲ DIC Report 2022

Consolidated Balance Sheet

As of December 31, 2020 and 2021

（Millions of yen）

2020

2021

Liabilities

145,816

Short-term loans payable

10,275

10,437

Current portion of long-term loans payable

27,096

37,131−

20,000

Lease obligations

1,061

1,092

Income taxes payable

4,985

5,640

Provision for bonuses

5,480

6,125

Other

53,022

79,334

197,181305,575

Bonds payable

100,000

140,000

Long-term loans payable

123,766

171,443

Lease obligations

4,543

4,112

Deferred tax liabilities

12,525

10,725

1HWGH¿QHGEHQH¿WOLDELOLW\

17,071

35,989Asset retirement obligations

1,691

7,689

Other

9,809

14,940Total non-current liabilities

269,405

384,897

Total liabilities

466,586

690,473

Capital stock

96,55796,557

Capital surplus

94,46894,468Retained earnings

219,778

214,665

Treasury shares(1,800)(1,780)409,003403,910

Valuation difference on available-for-sale securities

2,903

5,449

Deferred gains or losses on hedges

2,468

92

)RUHLJQFXUUHQF\WUDQVODWLRQDGMXVWPHQW(82,321)(55,456)

5HPHDVXUHPHQWVRIGH¿QHGEHQH¿WSODQV(13,562)(8,067)

Total accumulated other comprehensive income(90,511)(57,983)

Non-controlling interests

32,87335,081

Total net assets

351,364

381,008

817,950

1,071,481

Current portion of bonds payable

Total current liabilities
Non-current liabilities

Net Assets

Total shareholders’ equity

Data

Shareholders’ equity

Accumulated other comprehensive income

Total liabilities and net assets

Value Creation Strategies

95,263

Value Creation Cornerstones

1RWHVDQGDFFRXQWVSD\DEOH²WUDGH

Value Creation Essentials

Current liabilities

DIC Report 2022 ̲84

Consolidated Statement of Income

Years ended December 31, 2020 and 2021
（Millions of yen）

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

2020
Net sales
Cost of sales*URVVSUR¿W
Selling, general and administrative expenses
Freightage and packing expenses
Employees’ salaries and allowances
Provision of allowance for doubtful accounts
Provision for bonuses
5HWLUHPHQWEHQH¿WH[SHQVHVResearch and development costs
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Foreign exchange gains(TXLW\LQHDUQLQJVRIDI¿OLDWHV
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income*DLQRQVDOHVRIVXEVLGLDULHV¶DQGDI¿OLDWHV¶VHFXULWLHVGain on sales of non-current assets
Gain on bargain purchase
Insurance income
Total extraordinary income
Extraordinary losses
Acquisition-related expenses
Loss on disposal of non-current assets
Impairment losses
Severance costs
Loss on disaster
Provision for environmental measures
Loss on business liquidation
Total extraordinary losses
Income before income taxes and non-controlling interests,QFRPHWD[HV²FXUUHQW,QFRPHWD[HV²GHIHUUHG
Total income taxes
Net income
Net income attributable to non-controlling interests

Data

Net income attributable to owners of the parent

Consolidated Statement of Comprehensive Income

2021
701,223544,430
156,793855,379
678,061
177,318

12,914
42,776
866
2,242
(257)
12,02946,560117,130
39,663

15,87048,950
287
2,431
(552)
13,50353,935
134,425
42,893

1,263
416
−
771
2,066
4,516

1,223
401
250
2,943
2,017
6,835

2,225
1,384
4,117
7,726
36,452

2,176
−
3,794
5,970
43,758

−
5,226
1,295
531
7,052

769
482
−
−
1,251

4,563
2,903
1,251
924
−
−
8,762
18,40325,102
10,336(1,651)
8,685
16,417
3,184
13,233

6,911
3,139
1,563
522
463
300
−
12,897
32,112
13,60912,04125,650
6,462
2,097
4,365

Years ended December 31, 2020 and 2021

（Millions of yen）

2021

2020
Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges)RUHLJQFXUUHQF\WUDQVODWLRQDGMXVWPHQW
5HPHDVXUHPHQWVRIGH¿QHGEHQH¿WSODQVQHWRIWD[
Share of other comprehensive income of associates accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controlling interests

85̲ DIC Report 2022

16,417

6,462

1,175
1,785
(9,827)
10,689158
3,980
20,3962,549(2,376)27,0105,616
1,334
34,13440,596

17,3683,028

36,894
3,702

Consolidated Statement of Changes in Net Assets Years ended December 31, 2020 and 2021
Fiscal year ended December 31, 2020

（Millions of yen）

Shareholders’ equity

Balance at January 1, 2020

Capital stock

Capital surplus

96,557

94,456

Retainedearnings

218,209

Treasury shares

Total
shareholders’ equity(1,823)407,398

Change in FY2020
Dividends from surplus(8,531)

Net income attributable to owners of the parent

13,233(8,531)
13,233Purchase of treasury shares(5)

Disposal of treasury shares

28

Change of scope of equity method(3,133)

Change in ownership interest of parent due to transactions with non-controlling interests(5)28(3,133)12

12

Total change in FY2020
Balance at December 31, 2020

−

12

1,569

23

1,605

96,557

94,468219,778(1,800)409,003（Millions of yen）

Accumulated other comprehensive income

Balance at January 1, 2020

Valuation difference
on available-for-salesecurities

Deferred gains orlosses on hedges

Foreign currencytranslation
adjustment

Remeasurements
RIGHÀQHG
EHQHÀWSODQV

Total accumulated
other comprehensive
income1,676

683(72,671)(24,346)(94,658)

Non-controllinginterests

30,757Total
net assets

343,497

Value Creation Essentials

Net changes of items other than shareholders’ equity(8,531)
13,233Purchase of treasury shares(5)

Disposal of treasury shares

28

Change of scope of equity method(3,133)

Change in ownership interest of parent due totransactions with non-controlling interests
Net changes of items other than shareholders’ equity

1,227

1,785

(9,650)10,784

4,147

2,116

6,262

Total change in FY2020

1,227

1,785

(9,650)10,784

4,147

2,116

7,868

Balance at December 31, 2020

2,903

2,468

(82,321)(13,562)(90,511)32,873351,364

12

Fiscal year ended December 31, 2021

（Millions of yen）

Shareholders’ equity

Balance at January 1, 2021

Capital stock

Capital surplus

96,557

94,468Retainedearnings

219,778

Treasury shares

Total
shareholders' equity(1,800)409,003

Change in FY2021
Dividends from surplus(9,479)Net income attributable to owners of the parent

4,365(9,479)

Value Creation Cornerstones

Dividends from surplus
Net income attributable to owners of the parent

Value Creation Strategies

Change in FY2020

4,365

Purchase of treasury shares

(9)

(9)

Disposal of treasury shares

29

29

Total change in FY2021
Balance at December 31, 2021−−

(5,114)20(5,094)96,557

94,468214,665(1,780)403,910（Millions of yen）

Accumulated other comprehensive income

Balance at January 1, 2021

Valuation difference
on available-for-salesecurities

Deferred gains orlosses on hedges

Foreign currencytranslation
adjustment

Remeasurements
RIGHÀQHG
EHQHÀWSODQV

Total accumulated
other comprehensive
income

2,903

2,468

(82,321)(13,562)(90,511)

Non-controllinginterests

32,873Total
net assets

351,364

Change in FY2021
Dividends from surplus(9,479)Net income attributable to owners of the parent

4,365

Purchase of treasury shares(9)

Disposal of treasury shares
Net changes of items other than shareholders’ equity

29
2,546

(2,377)

26,865

5,494

32,5282,208

34,736

Total change in FY2021

2,546(2,377)

26,865

5,494

32,5282,208

29,643

Balance at December 31, 2021

5,449

92

(55,456)(8,067)(57,983)

35,081

381,008

DIC Report 2022 ̲86

Data

Net changes of items other than shareholders’ equity

Consolidated Statement of Cash Flows Years ended December 31, 2020 and 2021
（Millions of yen）

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

2020
Net cash provided by (used in) operating activities
Income before income taxes and non-controlling interests
Depreciation and amortization
Amortization of goodwill
Loss (gain) on bargain purchase
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Interest and dividends income(TXLW\LQ HDUQLQJV ORVVHVRIDI¿OLDWHVInterest expenses
Loss (gain) on sales and retirement of non-current assets
Impairment losses
Loss on business liquidation/RVV JDLQ RQVDOHVRIVXEVLGLDULHV¶DQGDI¿OLDWHV¶VHFXULWLHV'HFUHDVH LQFUHDVH LQQRWHVDQGDFFRXQWVUHFHLYDEOH²WUDGH
Decrease (increase) in inventories,QFUHDVH GHFUHDVH LQQRWHVDQGDFFRXQWVSD\DEOH²WUDGH
Other, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of shares and investments in capital of subsidiaries resulting in change in scope of consolidation
Proceeds from sales of shares and investments in capital of subsidiaries resulting in change in scope of consolidation
Payments for sales of shares and investments in capital of subsidiaries resulting in change in scope of consolidation
3URFHHGVIURPVDOHVRIVXEVLGLDULHV¶DQGDI¿OLDWHV¶VHFXULWLHV
Purchase of investment securities
Proceeds from sales and redemption of investment securities
Proceeds from sales of businesses
Payments for transfer of businesses
Other, net
Net cash provided by (used in) investing activities
1HWFDVKSURYLGHGE\ XVHGLQ ÀQDQFLQJDFWLYLWLHVNet increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from issuance of bonds
Cash dividends paid
Cash dividends paid to non-controlling interests
Net decrease (increase) in treasury shares
Purchase of shares and investments in capital of subsidiaries not resulting in change in scope of consolidation
Other, net
1HWFDVKSURYLGHGE\ XVHGLQ ¿QDQFLQJDFWLYLWLHV
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period87̲ DIC Report 2022

2021
25,10232,581143(1,295)(548)(124)(1,679)(771)
2,225(2,324)
1,251
8,762
−
10,781
10,158(12,453)(10,847)
60,963
3,249(2,385)(7,366)54,462

32,11237,394656−(1,386)632(1,624)(2,943)
2,176
2,657
1,563
−
(769)
(15,963)(34,348)
34,261
2,676
57,093
3,358(1,963)(13,676)
44,812(8,024)
4,589(32,719)
5,895(1,280)(2,817)
890
(16)
226
(51)
352
−
(78)
(3)
(33,037)

(402)
3,433
(35,935)909(2,706)(124,095)−−
11,618
(142)
1,589
95
−
(1,975)(147,612)(8,866)
42,105(35,325)
20,000(8,531)
(782)
23
(114)
(2,173)
6,338(3,100)24,663
16,69041,354(650)
89,070(36,277)
60,000(9,479)(1,475)20−(1,660)99,549(531)(3,782)
41,35437,572

Data

Value Creation Cornerstones

Value Creation Strategies

Value Creation Essentials

Third-Party Verification

The DIC Group commissioned SGS Japan Inc. to conduct third-party verification of its data forgreenhouse gas emissions, discharge of industrial waste and number of occupational accidents (including
number of accidents leading to workdays lost).

DIC Report 2022 ̲88

（Contact）

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Sustainability Dept.
DIC Building, 7-20, Nihonbashi 3-chome, Chuo-ku, Tokyo 103-8233, Japan
Tel: +81-3 - 6733 - 3034

Fax: +81-3 - 6733 - 3038

https://www.dic-global.com/en/