Daiseki Co., Ltd.

ESG REPORT 2023

Making the best use of limited resources

An environment-creating company contributing tosociety through the environment

Daiseki Aims

Management Principles

Ideas, Plans, Structures, Actions
After conceiving of an idea, we consider it various ways, built organizationand other structures to realize it, and put our plan into action.

Our purpose
Making the best use of limited resources

An environment-creating company contributing
to society through the environment

CONTENTS
DaisekiAims

1

The Story of Value Creation at Daiseki

MaterialityAssessmentProcess

17●Environment27

DriversofDaisekiGrowth3FinancialandNon-FinancialHighlights

19●Society:People

37

DaisekiCoreBusiness5

DaisekiGroup’sPerformancebyBusiness21●Society:Safety

41●Society:LocalCommunities

43●Governance45

Special Feature 1:

TheDaisekiGroupValueCreation

1

ESG Reporting

DaisekiGroup’sPriorityIssuesand

Process7

AConversationwithTopExecutivesin

TopMessage

9

OurSalesDepartments

Non-Financial Information and Company

ProgressofVision2030(OurLong-Term

Theoverarchingsalesdepartmentsgoalsof

Information

ManagementVision)andOurLong-TermtheDaisekiGroup,whichcontinuestocreate

MainSustainabilityReporting51

BusinessPlan13valueasapartofthe“venousindustry” 23

Third-PartyAssurance

52

MessagefromtheVicePresident15

Third-PartyOpinion53

DaisekiGroupOverview54

Special Feature 2:
DaisekiGroup'sCapitalInvestment25

Ethics Charter

Good-faith responsible action
is at the heart of the Company.

Acommitmenttogood-faith,
responsibleactionfromeachand
everyoneofourexecutivesand
employeesisatthecoreofour
positionastrustworthymembers
ofsocietyandthefirstchoiceof
ourcustomers.Inrecognitionof
this,wehaveestablishedthe
DaisekiEthicsChartertoguide
ourbusinesspractices.

Code of Conduct

Code of Conduct is internal
rules for members of Daiseki.

Weoperateourcorporatebusiness
prioritizingsocialresponsibility,
complianceoflawsandregulations,
andbasichumanrightstoensureasmembersofDaiseki.“CodeofConduct”
describesbasicinternalrulesforexecutivesandemployees
tofollow.

1. Societal Role and Responsibilities

 W efullyrecognizeoursocietalroleandresponsibilitiesasacompany
providingintermediateindustrialwastetreatment.Byfollowingsoundand
appropriatebusinesspracticesbasedontheprincipleofaccountability,
westrivetobeworthyofthetrustsocietyplacesinus.

2. Compliance with Laws and Regulations

 W
 eworktoimplementinternalcontrolmaintainingstrictcompliance
withlaws,regulations,andcompanyrules,andcarryoutappropriate
businessoperationsandfair,good-faithbusinesspractices.

3. Respect for Human Rights and Promotion of an Open-Minded
Corporate Culture W erespecthumanrightsandstrivetopromotearewardingand
open-mindedcorporateculture.
[ Code of Conduct Articles ]1. Daiseki’s Basic Stance(1)Pursuitofsoundbusinesspractices(2)Promotionofmutualunderstandingwithwidersociety(3)Supportforactivitiesthatmakeasocialcontribution(4)Respectfortheglobalenvironment

2. Core Concepts for Employee Treatment(1)Highexpectationsofemployees(2)Respectforfundamentalhumanrights(3)Provisionofaworkenvironmentthatfostersindividualcapabilities

3. Guidelines for Fair Business Practices(1)Compliancewiththeantimonopolyact(2)Appropriateapproachtoentertainment,gifts,andsimilarpractices(3)Transactionswithpublicinstitutions,handlingofpolitical
contributionsanddonations

4. Guidelines for Information Protection(1)Handlingoftradesecrets(2)Handlingofinsideinformation(3)Handlingofintellectualproperty

Publication Details● Scope and Areas Covered by This ReportThisreportcoverstheESGactivitiesoftheDaisekiGroupasawhole.
However,someofitscontentrefersonlytoDaisekiCo.,Ltd.(whichaccountsfor
approximately58%oftheGroup’snetsales).
● Period Covered by This Report and Important Organizational Changes Occurring During This PeriodThisreportcoversFY2023(March1,2022toFebruary28,2023).However,some
sectionsrefertoactivitiesandresultsoccurringbeforeorafterthisperiod.
Nosignificantchangestothestructureofourorganization,ourshareholdercomposition,
ourbusinessdescription,orothersimilarareashaveoccurredwithintheperiodcovered.
● Date of Publication, Previous Publications, and Next Planned Publication
Dateofpublication:August31,2023.Previouspublication:August31,2022.Nextplanned
publication:August2024● Division in Charge of Publication & Contact Information
PlanningDivision,HeadquartersofPlanningandManagement,DaisekiCo.,Ltd.
TEL:+81-52-611-6322/FAX:+81-52-612-4382E-mail:kankyo@daiseki.co.jp● Key Company InformationSeeourcorporateprofile,securitiesreports,shareholdercommunications,ESGreports
(environmentalreports,environmentandsocietyreports,CSRreports),website,orthe
SanpaikunWasteInformationNetwork

2The Story of Value Creation at Daiseki

Drivers of Daiseki Growth

Daiseki was founded in 1958, before the word“recycling”was in common usage, and started out inthe manufacture of lubricating oil and recycling of waste oil. Since obtaining permission for industrial
waste management in 1972, we have been promoting building a recycling-oriented society with thephilosophy“Making the best use of limited resources.”
We will continue to contribute to the development of sustainable society through resolving social
challenges, as an environment-creating company.

Began our waste treatment andrecycling business as pollution became
an increasingly pressing issue

Daiseki Group’s journey
to value creation

1972◦Obtained permission for industrial waste
management in the city of Nagoya
1973◦Opened the Hokuriku Works in thecity of Hakusan, Ishikawa Prefecture
1980◦Opened the Osaka office in city ofAmagasaki, Hyogo Prefecture
1982◦O p e n e d t h e K y u s h u W o r k s i n
Wakamatsu-ku, the city of KitaKyushu
1984◦C hanged the company name to
Daiseki Co., Ltd.
◦R eceived Chairman Award from
Clean Japan Center Foundation(current JEMAI) as a company
contributing for renewal materials
1990◦O pened the Kanto Works in thecity of Sano, Tochigi Prefecture

Moved from refining oils and fats topetroleum sales and re-refining used oil
1945◦Founded oil and fat refining businessin Mie District of Mie Prefecture
1958◦Established Daido Sekiyu
Kagakukogyo Co., Ltd.
1963
◦Opened Nagoya Works in Minato-ku,
city of Nagoya
1966◦Opened Kyushu Works in Kokura-ku,
city of Kitakyushu
1970◦Opened Hokuriku Daiseki Co., Ltd. in thecity of Kanazawa, Ishikawa Prefecture

Founder Haruo Ito

Daido Sekiyu Kagakukogyo

Founding period (1945–1970)

Hokuriku Works

Kyushu Works

Kanto Works

Seminal period (1971–1990)

Daiseki’s achievement on value creation● Consolidated Net Sales (unit: millions of yen)

35,16037,22429,08026,96813,03013,315

2001
2002(Listed on First Section)

3

15,3802003

16,9492004

19,085

2005

36,51331,477

21,644

2006

2007

2008

2009

2010

2011

2012

Accelerating group development with anemphasis on recycling
2002◦O pened the Kansai Works in thecity of Akashi, Hyogo Prefecture
2003◦Awarded first“Honest Company Award”
Kansai Works◦President Hiroyuki Ito received Ministerof the Environment Award (award forcontribution to living environment
improvement) at national convention
for industrial waste and environment
2008◦Made Daiseki MCR Co., Ltd. a whole
Daiseki MCR
subsidiary
2010◦Made System Kikou Co., Ltd. a wholesubsidiary
2011◦Supported reconstruction efforts following
System Kikou
the Great East Japan Earthquake
2021◦Received the Japan Environmental
Management Association for
Industry Chairman’s Award at theAwards for Resources Recirculation Supported reconstruction
Technologies and Systems
efforts in areas affectedby the earthquake◦E xhibited at the COP26 Virtual
Japan Pavilion2022◦D aiseki and Daiseki Eco. Solution
were transferred to Tokyo Stock
Exchange Prime Market and Nagoya
Tokyo Stock Exchange
Stock Exchange Premier Market◦E xhibited at the COP27 Virtual Prime Market Trademark
Japan Pavilion
2023◦D aiseki Eco. Solution selectedStandard Market division on theTokyo Stock Exchange

IPO for the company’s further growth
1995◦Listed on stock market
1996◦E stablished Daiseki Plant Co., Ltd.
(today Daiseki Eco. Solution Co., Ltd.)by dividing engineering department
1997◦O pened the Chiba Works in thecity of Sodegaura, Chiba Prefecture
1998◦R e c e i v e d J a p a n C o a s t G u a r dCommissioner Award and Maritime
Disaster Prevention Center Chairman
Award, recognized with heavy
crude oil collection work leaked
from Russian tanker Nakhodka in
the Sea of Japan◦Chiba Works was first certified for
ISO 14001 in the Company(JQAEM0304)
1999◦L isted on Tokyo Stock Exchange
and Nagoya Stock Exchange
Second Section
2000◦Alternatively listed on Tokyo Stock
Exchange and Nagoya Stock
Exchange First Section

Daiseki Eco. Solution

Chiba Works

Collection of heavy crude
oil leaked from Russian
tanker Nakhodka

Re-designated on Tokyo
Stock Exchange First
SectionRapid growth period (1991–2000)

50,80942,10045,73849,185Development period (2001–Present)

51,31354,08856,86758,572

51,53044,23236,013

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

(FY)

4

The Story of Value Creation at Daiseki Daiseki Core Business

By considering waste asa resource, we contribute tobuilding a recycling-oriented
society
Generators

User

Wastegeneratorsmaynotknowhowtorecycletheirwasteorhow
theendproductcanbeused-we
solvetheseproblemsforthem.

◀

Industry &Society◀

Weproviderecycledproducts
thatfulfilluserneeds.Wearealso
involvedintheco-developmentofrecycledproducts.

◀

◀

◀

◀

Daiseki Operations

We turn the industrial
waste generated during
manufacturing processes

Intermediate
Treatment

into useful resources

◀ ◀

◀ ◀

Collection &Transportation

◀

◀

◀ ◀ ◀

Sampling

Analysis &Sorting

Recycling Rate

Daiseki’s received amount of materials to be recycled

87.1%

1,070,000tons(FY2023)(FY2023)

Note:Seepage28fordefinitionsof“recyclingrate”and“receivedamountofmaterialstoberecycled”

5Combining a Variety of Technologies to Maximize
Recycling of Waste into Resources
Waste oil

Wastewater

SludgeWerecycledegradedlubricatingoils,producerecycledheavyoil
byseparatingoutwatercontent
a n d c o n t a m i n a n t s b e f o r e r e refiningit,andprocesswasteoils
intosupplementalfuels(coal
substitutes)byadjustingtheir
compositiontomeetuserneeds.

Weseparateoutanyoilcontent,which
canbeconvertedintofuel;neutralize
wasteacidsandalkalis;thenuseactivated
sludgetopurifythewater.Afterverifyingthatitconformstothewaterquality
s t a n d a r d ss e tb yn a t i o n a la n dl o c a l
governments,wedischargethewastewater
intoriversorsewersystems.Wealso
recoveruseablemetalsfromwastewater.

Throughtreatmentsincludingdehydration,drying,andkneading(mixingwithatreatmentagent),
werecyclesludgeintotheraw
m a t e r i a l s f o r c e m e n t . W eminimizethequantityofsludge
t h a tc a n n o tb er e c y c l e da n doutsourcelandfilldisposalofany
remaining.

Oilsandotherliquids

Wasteacids(pH7orlower)andwastealkalis(pH7orhigher)inliquidform

Muddywaste

Treatment and recycling

Treatment and recycling

Treatment and recycling

Wasteoiltreatment(vibrationsievingmachine)

Activatedsludgetreatment

Dehydrator

Wasteoiltreatment(centrifuge)

Metalrecoverydevice

Dryingdevice

Recycled fuels

Usable metals, etc.

Raw materials for cement

Note:Recycledfuelsmeanrecycledheavyoilandsupplementalfuels.

6

The Story of Value Creation at Daiseki The Daiseki Group Value Creation Process

As the premier company in Japan’s“venous industry,”
Daiseki is engaged in creating the value that society needs
INPUT

Daiseki Group’s foundation as anenvironment-creating company

1Japan-wide
network

2

Extensive businesstrack record

3Advanced
technologies

4

Expertise on
relevant laws andregulations

5

Robust inboundreceipt system

6Sound financial
structure

BUSINESS

Conducting Business that Sees Indus
Resource and Strives to Solve Social

Withanetworkof42basesacrossJapan,
theDaisekiGroupprovidescomprehensive
servicesintheareasofindustrialwaste
treatmentandresourcerecycling.

Boastingatrackrecordofbusinesswithover
10,000companies,wesupporttheJapanesemanufacturingindustrybyproposingoptimal
recyclingmethodsinresponsetorequests
fromcustomersinallindustries.
Wehaveadvancedtechnologiessuchasintegrated
processingbyDaisekithatsimplifiesprocessingby
combiningdifficult-to-treatwastewater,optimalresearchandpurificationprocessbyDaisekiEco.SolutionCo.,
Ltd.,recyclingofwastebatteriesintoJISstandardlead
byDaisekiMCRandsafeandhigh-qualitywasteoil
cleaningthroughCOWmethodbySystemKikou.
Employeeswhoareknowledgeableabout
lawsthatarehardtounderstand,suchas
WasteManagementandPublicCleansingActorSoilContaminationCountermeasuresAct,provideaccurateguidancetocustomers
fromtheperspectiveoflegalcompliance.
Weareequippedwithaninboundreceiptsystem
capableofprocessingover2,000,000tonsofwaste
annually,andensureproperdisposalofthatwaste.
Wealsoownover200vehiclesfortransportation,
whichestablishesthesystemtopromptlyrespondtorequestsforcollectionfromcustomersand
supportsforrecoveryfromdisasters,
WhilecompanieswithcapitaloverJPY1
billionaccountforapproximately1%ofthe
industrialwastetreatmentindustry,Daiseki’slistingonthestockexchangein1999cametobeoneofthefirstcompanyspecializingin
industrialwastedisposalbusiness.

Waste generators
Requestforindustrial
wastetreatment

Deman
produ

Treatment fees

Properdisposaland
environmentalprotection

New Business●M&A with an emphasis on“environment”
and“recycling”as core businesses●Promotion of alliances including
businesses in different areas●Widening the range of items handled bydevelopment of recycling process
technologies

Sale

Product assembl

Arterial industries
Core value
Our purpose

7

The recycling and industrial waste treatment industry is referred to as the“venous industry.”
Like veins that carry blood from the heart via arteries throughout the body,then return it back to the heart, the Daiseki Group sees its role as recycling waste generated bymanufacturers’production processes in the“arterial industry”as fuel and raw materials, thenreturning them to the manufacturers for reuse.

strial Waste as al Issues

OUTPUT

Maximizing Recycling of Industrial
Waste into Resources by Combining
a Variety of Technologies

OUTCOME

Creating Value by Solving
Social Issues
Recycling-Oriented
Society

Users of recycled products

Recycled fuels

Recycled lead

We provide our customers witha product in the form of recycledmaterials and conserve resources
to contribute to the creation of arecycling-oriented society.

ndforrecycled
ucts

Environmental Protection
Product saleslyUsable metals, etc. Tank cleaning

Salesofrecycled
products●Growth in Asia bybusiness expansion
into foreign markets●Deployment ofbusinesses that also
target entities otherthan factories, suchas local governments

Raw materials for cement Raw materials for plasterboard

Biodiesel fuelMaterial and parts processing

By providing waste purification
services, we support theenvironmental protection eﬀorts
of our waste-producing
customers.

Transitioning Away from
Fossil Fuels

We manufacture and sell wastederived fuels in accordance withgovernment policies and market
needs pertaining to thetransition away from fossil fuels.

Recycled paper

Raw material procurement(manufacturing industries)
Nuture the future
Making the best use of limited resources

An environment-creating company contributing
to society through the environment
8

The Story of Value Creation at Daiseki Top Message

As an environment-creating company, we willcontribute to the realization of a sustainable society
through our commitment to carbon neutrality andresource recycling that creates new value from waste
Representative Director

President and Executive Officer

Further strengthening the managementfoundation in one year as the new president
I nF Y 2 0 2 3 ,D a i s e k i ' sc o n s o l i d a t e dn e ts a l e sreached58.5billionyen,andprofitsreached8.6
billionyen,anewall-timehigh.However,wewereunabletoachievethetargetsetatthebeginningofthefiscalyearduetotheeffectsofsluggishgrowth
o f t h e i n d u s t r i a l p r o d u c t i o n i n d e x f o r t h emanufacturingsectorcausedbytheimpactofthe
COVID-19pandemic,semiconductorshortages,andasupplyoutageatanindustrialwaterworksinJapan’sTokairegion.Despitethisimpact,weexpect
theseexternalfactorstodissipateinthefuture.
Daisekiwillstrengthenitsstablemanagement

9

Tetsuya Yamamoto

foundationtobelesssusceptibletoexternalfactors
throughself-supporteffortssuchasacquiringnew
customersandreducingcosts.
SincebeingappointedasthenewpresidentinMay2022,Ihavepromotedeffortsfocusedon
environmental,social,andcorporategovernance
aspects.First,regardingtheenvironmentalaspects,
thetideisrunninginDaiseki’sfavorwiththeglobal
trendtowardcarbonneutrality.Weareaparticipant
oftheGXLeagueledbytheMinistryofEconomy,
T r a d ea n dI n d u s t r ya n dh a v ep r o m o t e do t h e rcarbonneutralitymeasuressuchasadoptingtheuseofrenewableelectricity.Asinthepreviousyear,
ourCDPevaluationforFY2023wasaB,andin
FY2024wewillaimtofurtherimprovethisscore.In
December2022,wesignedanagreementwith
GamagoriCitytopromotethecirculareconomy.
ThisisourGroup’sfirstinitiativeincollaboration
withalocalgovernment.Theagreementaimsto
realizeacirculareconomyinthelocalcommunity.
WearepromotingthisinitiativewiththehopethatitwillleadtonewbusinessfortheDaisekiGroup.
Fromasocialperspective,DaisekiandDaiseki
M C R r e c e i v e d t h e H e a l t h a n d P r o d u c t i v i t yManagementOrganizationcertificationforthe
secondyearrunning.InApril2023,wehiredapublichealthnurseresponsibleforprovidinghealthc o n s u l t a t i o n sf o re m p l o y e e sa n dc o n d u c t i n g
workplacevisits,andwecontinuetoenhanceour
healthmanagement.Theturnoverrateforthe
consolidatedGroupinFY2023was3.2%,and1.9%
forDaisekionanon-consolidatedbasis.Thisrateis
lowcomparedtotheinternationalstandardand
othercompaniesinthesameindustry,indicatingthatwehaveahighemployeeretentionrate.Ib e l i e v e i t i s i m p o r t a n t t o i n c r e a s e e m p l o y e eengagement by preventing harassment andfacilitating communication.
As for corporate governance, in May 2023 we
appointed one external director who has experiencein corporate management, creating a management
structure consisting of three internal directors andfour external directors. By incorporating objective
and expert knowledge into our management, we
will protect the interests of investors, employees,
business partners, and other stakeholders andenhance our corporate value.

Promoting carbon neutrality based oninternational standards
In November 2022, we received certification from
SBTi that our greenhouse gas reduction targets arein compliance with the target of limiting global
warming to 1.5℃. This represents how Daiseki’sefforts toward carbon neutrality have beenrecognized on the global stage. Our core recycling
business has the advantage of being able to processindustrial and other wastes using less energy, and isenvironmentally friendly, emitting far lessgreenhouse gases than incineration or landfills. We
will actively communicate this strength to customers
and strive to contribute to the realization of acarbon-neutral society and expand our business.
Regarding the actual reduction of emissions, thecurrent issue at hand is considering how to reduce
our Scope 1 emissions, which are generated by thecompany’s own fuel use and industrial processes. At
present, more than half of the energy used by theGroup is derived from fuel, and in particular a large
amount of diesel fuel is used in our company vehicles.
As the commercial use of electric vehicles has not yet
been implemented widely, we are consideringvarious measures. We plan to reduce Scope 2
emissions, which are indirect emissions resulting
from the use of electricity and other energy, to zeroby switching to renewable electricity at all company
sites by FY2028. Furthermore, regarding Scope 3
emissions, which are emitted by other companies
associated with our business activities, from FY2024
we are planning to coordinate with partnercompanies to whom we outsource transportation ofwaste and recycled products. We are aiming to
reduce greenhouse gas emissions by requesting thatour partner companies provide fuel consumption
data relating to transportation and by streamlining
transportation systems.
In order to achieve Japan’s goal of realizing acarbon-neutral society by 2050, it is crucial to makereforms to the socio-economic system. In March
2022, Daiseki announced its support for theindustry-government-academia collaboration known
as the GX League. From FY2024 we will promote
activities for innovation and to strengthen systems
as a participating company. The GX League holds
discussions on the GX-ETS system, in which
participating companies voluntarily trade emissions,as well as contributions to emissions reductions atother companies, and government and corporate
initiatives and policies. As a participating company
representing the recycling industry, also known asthe“venous industry”which turns industrial waste
into reusable resources, we intend to be proactively
involved in these activities going forward.

Aiming to be a company that prospers for 100
years: Daiseki’s sustainability management
Thus far, we have made endeavors forsustainability management with the long-term
perspective of becoming a company that prospers
for 100 years. In terms of my priorities inmanagement, first is employee health, followed by
employee safety, and then compliance. We also aim
to be a company where employees can win thetrust of society and our customers as professionals
and do work that makes their families proud.
Our long-term business plan, "Vision 2030," sets
the goals of capturing 30% of the Japan market
share and tripling net sales and operating profit, andthe involvement of each and every employee isessential to achieving these goals. We also
recognize that it is management’s responsibility tocreate a healthy work environment for employees,
in terms of both physical and mental aspects. In
addition to providing a full range of benefits such as
health promotion initiatives and childcare support,
as well as enhancing salaries, we have created asystem to carefully listen to employees’opinions,
including engagement surveys and 360-degree
evaluations, and are focusing on creating
comfortable work environments where employees
can enjoy a sense of fulfillment. We will also ensure
employee safety by actively promoting the safe
handling of hazardous materials by training staff to
the task and the introduction of the latest
equipment.
In terms of compliance, as a company operating its
businesses under a government license, we havethoroughly conducted activities to increase
employee knowledge and awareness of compliancewith laws and regulations.

10

The Story of Value Creation at Daiseki Top Message

Four types of“waste”Daiseki aims
to eliminate through the circular economy❶ Waste of resources: Raw materials and energy that cannot be continually renewed.
❷ Waste of capacity: Under-used and unused products and resources.
❸ Prematurely discarded items: Usable products which are disposed of before theiruseful lifespan has expired.
❹ Waste of potential value: Parts, raw materials, and energy that is not collected orreused from discarded products.
Outline of circular economy butterfly diagram

Renewables
Farming/Fishing/Hunting

Finitematerials

Parts manufacturer

RecycleBiosphere
Product manufacturer
Biochemical feedstock

Remanufacture/
Refurbish

Service provider

Reuse/
Redistribute
Maintain/
Prolong/
Share

Recycling/
CascadesConsumer

User

Collection

Anaerobic
digestion/
CompostBiogasExtraction ofbiochemical feedstock
Energy recovery

Biologicalcycle

Technical
cycle
Landﬁlls

Created with reference to Circular Economy Japan (CEJ)“What is the circular economy?”, May 31, 2020

11

The mindset of legal compliance that we havebeen steadily upholding since the establishment ofDaiseki is not only to protect our own company, butalso to protect the long-term interests and positionsof our customers, and we view it as a highly
significant social responsibility of Daiseki.

Daiseki’s circular economy:
Utilizing resources and eliminating waste
We aim to be an environment-creating company
that everyone associates with the term“circular
economy.”Our recycling philosophy begins with theidea of utilizing waste as a useful material via ourtechnology, rather than viewing it as something to
be disposed of. The circular economy refers toeconomic activity that minimizes the extraction ofnatural resources and recycles waste and usedproducts as resources, a method which is consistent
with our philosophy.
In a society that has realized a circular economy,
the manufacturing industry must procure materials
and conduct manufacturing processes in a way thattakes into account maintenance, resale, reuse,refurbishing, and recycling. In such a society, thevalue of companies with resource recycling knowhow and broad networks will increase, and webelieve that this will be an opportunity for us tomake significant contributions. However, since thecircular economy is not yet widespread, today thecost of waste separation and transportation is aburden on companies, and is also a factor increasing
greenhouse gas emissions. Based on these realworld problems, we will build a circular economy
business model that is both environmentally friendly
and profitable, while developing an environmental
business that provides proprietary solutions such as
resource selection, technology development, andconsideration of raw material suppliers and sales
outlets. Considerations for business areas include
approaches to waste before it is emitted fromfactories, as well as approaches to general waste
generated by local residents. Our agreement with
Gamagori City was signed as a part of these efforts.

We believe we can help promote the circular
economy by supplementing things that ourcustomers in the manufacturing industry are not yetaware of. For example, to factories we can propose
manufacturing methods using a single material, or
share expertise on how to recycle more easily. Thusfar, we have focused on recycling as our corebusiness, and now we will create businesses thatwill be useful to both corporations and local
governments in order to realize the circular
economy required by society.
We updated our website in April 2023 so that
more people can learn about our cutting-edge
initiatives in real time. For this update, we wereconscious of communicating our purpose andbusiness activities in an easy-to-understand andclear manner in order to present our initiatives tocorporations and general public, and to generateinterest in Daiseki as a B-to-B company among
students who will be responsible for leading thefuture. We also disclose more detailed sustainability
information for investors.
We will continue growing as an environmentcreating company and contribute to a sustainable
environment, society, and economy. We look forward
to your continued support for Daiseki in the future.

12

The Story of Value Creation at Daiseki

Progress of Vision 2030
(Our Long-Term Management Vision)and Our Long-Term Business Plan
In the aim of achieving the scale and ability that will allow us to compete with the top international
players in the industry, the Daiseki Group is working toward Vision 2030, our long-term
management vision established in FY2019 and eﬀective through FY2031.

Long-Term Management Vision:

VISION 2030

Based on Vision 2030, we are advancing the
3-3 Project, which aims to triple both our net
sales and our operating profit and establish
the Daiseki Group as a leader in the industry.

FY2031Long-term Plan

● Consolidated net sales:
JPY

FY2026

Medium-Term Plan

● Consolidated net sales:
JPY

FY2023

FY201825 billion

By FY2031, the Daiseki Group aims

14.7 billion

profit as compared to FY2018.

Actual Performance

Goal Setting(Actual Performance)● Consolidated net sales:● Consolidated net sales:● Consolidated operating profit:

JPY 49.1 billion

JPY

become a leader in the industry,
69.0 billion totripling
both net sales and operating● Consolidated operating profit:
JPY

150 billion● Consolidated operating profit:58.5 billion

JPY

12.7 billion

JPY● Consolidated operating profit:

JPY 8.7 billion

FY2018FY2023

FY2026

FY2031

The Daiseki Group’s Core Strategies
Domestic Strategies◦Increase activity in currently underserved
areas through cooperation between
existing facilities◦Expand into new areas throughdevelopment of new operating bases
Global Strategies◦Commence market research geared toward
expansion into the Asian market
Development of technologies and equipment◦Raise our recycling rate
◦Increase range of items accepted fortreatment by adopting new technologies
and equipment
Group Strategy◦Enhance synergy by strengthening
cooperation, including exchange of humanresources

13

Personnel
Development
Existing
Businesses

New
Business

Work Environment◦Rewarding work environment where
employees can hope to grow
◦Gender-neutral work environment
Human Resources Development◦Stimulate exchange of human resources
between Group companies◦Expand education system◦Implement internal system inviting new
project applications
M&A Strategy◦M&A with an emphasis on environmentand recycling
Alliance Strategy◦Promote alliance, including with otherindustries

FY2023 progress❶ Opening Three New
Operating Bases❷ Establishing Three New
Core Businesses●Hiroshima Works●Promotion of the circular economy

Aug. 2021: Land acquisition—20,454 m2
Jan. 2023: Began factory construction
Mar. 2024: Scheduled start of operation●We are in the process of finding
suitable land for two otherlocations.

●Development of businesses that also
target customers other than factories
Signed joint agreement with Gamagori
city in December 2022

●Growing into an environment-creatingcompany by expanding handled products

We are considering expanding the products that
we handle in addition to factory wastewater(Daiseki), soil (Daiseki Eco. Solution), and metals(Daiseki MCR) (disclosed on March 31, 2023,
M&A deal by Daiseki Eco. Solution, etc.)❸ Capturing 30%
Domestic Market Sharein Our Core Businesses●Kansai Works Harima Recycling
CenterSep. 2019: Land acquisition—63,432 m2
Jan. 2023: Start of first factory operation
period●At the end of February 2023,
Daiseki had a 25.2% share of
the Japanese market(transactions with 5,663 factories out of
22,491 manufacturing factories in Japan
with at least 100 employees)●In 2022, Daiseki announced its purposeof being“an environment-creatingcompany contributing to society
through the environment”by“making
the best use of limited resources.”

Vision 2030 plan for the future
The Daiseki Group aims to triple FY2018 levels for net sales and operating profit and become a leader in the industry
Target Performance Indicators and Value Drivers

Performance
Indicators

Value
Drivers●A chieve 150 billion yen or more in consolidated net sales and 25 billion yen or more inconsolidated operating profit● Consolidated ROE of 10% or more (FY2031 target: 15%)●S teadily increasing our dividend payout ratio through dividend increases and stockbuybacks if necessary

Net Sales Growth

Increasing Profitability

Increasing Efficiency● Increasing market share inboth Eastern and WesternJapan● Expanding peripheralbusinesses (subsidiaries,
M&A)● Improving recycling
technologies● Reducing costs bymonitoring variable andfixed costs● Improving operations● Improving capitalefficiency through capital
investment, M&A, andshareholder returns(dividend increases, share
repurchases, etc.)

FY2024 Plan
● Development of new businesses around the circular economy● Development of new markets by delving deeper into potential customers other than factories● Development of new technologies and businesses in partnership with universities● M&A with companies that have high synergy with the Daiseki Group● Strengthening cooperation within the Daiseki Group to increase earnings

14

The Story of Value Creation at Daiseki Message from the Vice President

Unifying the Daiseki Group to expand
existing businesses and take on new businessdevelopment challenges to achieve the longterm management plan,“Vision 2030”
Representative Director

Vice President and Executive Officer

Expanding Daiseki’s fields on the
tailwind of environmental needs
I nJ u n e2 0 1 8 ,w ee s t a b l i s h e do u rl o n g - t e r mbusinessplanatDaiseki,“Vision2030.”
Byworkingtoexpandourexistingrecyclingbusinessand
d e v e l o pn e wb u s i n e s s e s ,w ea i mt ot r i p l eo u rconsolidatednetsalesandconsolidatedoperatingprofitandcapturea30%shareoftheindustry.AtDaisekiweareproudtobeapioneeringrecycling
companyinJapan,andourgoalistofurtherexpandandbecometheNo.1recyclingcompanyinAsiaby
FY2031.
Forourexistingbusinesses,weareadvancingour
p l a n s t o o p e n a H i r o s h i m a W o r k s , a s w e l l a s
locationsinthesouthernKantoandTohokuregions.
Theplanaimstoreducetheenvironmentalburdenandcostoflong-distancetransportationwhile
simultaneouslyexpandingmarketshare.Inthe
Chugokuregion,constructionisunderwaytobringYasuo ItotheHiroshimaWorksintooperationinMarch2024,
a n d w e a r e i n t h e p r o c e s s o f f i n d i n g s u i t a b l elocationsfortheothertwobases.
Regardingtechnologydevelopment,wewillfocus
onexpandingthenumberofrecyclableitemsin
additiontoliquids,soil,andmetalswhichwealready
handle,aswellasimprovingtherecyclingrate,and
developingnewtechnologiesthatcancontributeto
therealizationofacirculareconomysociety.Daiseki
h a s a n n o u n c e d i t s p u r p o s e o f b e i n g“ a nenvironment-creatingcompanycontributingto
societythroughtheenvironment”
by“makingthebestuseoflimitedresources.”Ourmissionisto
contributetomanufacturinginJapan,acountrywithfewresources,throughourrecyclingtechnologythatconvertswasteintoresources.Inordertodoso,itis
essentialtohavecoordinationthroughouttheGroup.
Wehavealreadyinitiatedcollaborationonsales
betweenDaisekiandDaisekiEco.Solution,andwewouldliketopromotepersonnelexchangeand
informationsharingtoprovideone-stopsolutions.
RegardingdevelopmentoutsideJapan,weare
conductingresearchonthelegalsystemsand
businessinfrastructurewithafocusonSoutheast
Asia.Thewasteissuesfacedbyemergingcountriesduetotheirrapidindustrializationarebecoming
moreserious.Theenvironmentalregulationsinsuch
emergingnationsarenotasstrictasinJapan,sotheservicestheyrequirearequitedifferent.Therefore,
wearegatheringandexaminingawiderangeof
informationtobuildabusinessmodelthattargets
emergingcountries.Inthefuturewehopetoutilize
Daiseki’senvironmentaltechnologyonaglobalscale.

Strengthening M&A and alliances to tackle new
business areas that may become core businesses
Regardingnewbusinesses,wehavesetagoalof
launchingthreebusinesseswithsalesofaround15
billionyenthatcouldbecomecoreDaisekibusinesses

15

in t he f u t ur e . W e ha v e r e c ei v e d pr op o s al s f or
innovative ideas through our new business idea
competitions which were held three times for all
employees. We are considering these ideas as wemove forward with commercialization.
We are also promoting M&A, which will contributeto expanded market share and strengthened
technological capabilities. Our basic policy is to join
forces with companies who have a high degree ofcompatibility with our recycling business and who
will generate synergistic effects. In March 2023,
Daiseki Eco. Solution announced an M&A with
Sugimoto Trading Company Co., Ltd. By incorporating
their technical services for the transportation andprocessing of general and industrial waste and thecollection and recycling of used paper, we will
expand the solutions we can provide to ourcustomers.
For alliances, we signed an agreement with
Gamagori City to promote the circular economy. For
example, we are considering initiatives such as
recycling waste oil generated in Gamagori City into
recycled heavy oil for use in the city. Waste
treatment and effective utilization is a common issue
faced by local governments, and we at Daiseki hopeto establish a framework for business to be usedthroughout the rest of Japan. Additionally, we would
like to propose a system for recycling resources byforming alliances with manufacturing industry
companies, which are our customers.

Working to achieve Vision 2030, ourfoundation for ESG management
Five years have passed since we announced
Vision 2030, and I believe we are making steadyprogress in building up the required numbers andlaying the groundwork for growth.
Compared to our goals of achieving 150 billion yen
in net sales, 25 billion yen in operating profit, and15.0% ROE on a consolidated basis by FY2031, in thefiscal year ended February 28, 2023, we achieved
58.5 billion yen in net sales, 12.7 billion yen in
operating profit, and an 11.3% ROE. This marks a
19% increase in net sales, a 45% increase inoperating profit, and an increase in ROE from 9.9% to11.3% in the five years from the fiscal year ended
February 28, 2018 to the fiscal year ended February
28, 2023. We came close to achieving our target ofincreasing our Japan market share to 30% by
FY2031, reaching a share of 25.2% in the fiscal year
ended February 28, 2023.
We hold human resources and group governanceas key for creating the groundwork for generating
growth. Regarding human resources, we conduct
training including compliance study sessions which
are attended monthly by all employees, training per
job level when employees are promote d, a nd
management training for executive candidates. In
addition, to improve employee engagement, we
conduct evaluator training to ensure that managers
evaluate their subordinates correctly and fairly,
engagement surveys to ascertain company issues
and employee dissatisfaction and concerns, as wellas the Workplace Environment Improvement Project
which collects opinions from all employees on how
to create a comfortable workplace and responds tothis feedback in an organized manner. Regarding
Group governance, Daiseki dispatches one director
each to Daiseki MCR and System Kikou tostrengthen the management of Group companies
and cooperation within the Group.
Over the past five years, one of the social changes
we have seen is the rise of ESG management,
caused by the Japanese government’s declarationof achieving carbon neutrality by 2050. Our
company has been an early advocate ofenvironmental business, and ESG management isessential for us to achieve sustainable growth andenhance our corporate value.
In terms of environment, we are working to build
business models that contribute to the circular
economy. Thus far, our business has primarily beenthat of cascade recycling, in which the quality of the
product is lower than that of the raw material. Goingforward, by collaborating with other companies, we
aim to transition to material recycling which
provides higher quality recycled products. Looking
ahead to the future, we hope to have a corebusiness that can contribute both to the circular
economy and carbon neutrality.
From a societal aspect, strengthening humanresources is an issue, as previously mentioned.
Achieving Vision 2030 will require the imaginationand drive of each and every employee as we takeon challenges in uncharted waters. To this end, weare developing systems that can maximize theperformance of employees.
In terms of corporate governance, we haveappointed an external director with corporate
management experience in order to realize highlevel ESG management. The future of Daiseki will beforged by our directors’assertive management andaccountability. I look forward to working with
employees as a unified Group as we strive toward
the achievement of Vision 2030.

16

The Story of Value Creation at Daiseki

Daiseki Group’s Priority Issues andMateriality Assessment Process
The Daiseki Group aims to achieve continued sustainable growth as an environment-creating company
contributing to society through the environment. To this end, we have identified five materiality issues
and are promoting initiatives in these areas. We will promote the enhancement of our corporate value
with a medium- to long-term outlook while concurrently working on ESG perspectives.

Making the bestuse of limited
resources
Promoting thoroughunderstanding ofcompliance andobservation of laws
and regulations

The DaisekiGroup’s
Materiality

Creating
workplace that
individuals shine

Eliminating
industrial andenvironmental
accidents

A company
well-liked by
local
communities● Materiality Assessment Process
IPCC
1.5°
C Special Report

TCFD
scenario analysis

Reducing greenhousegas emissions

Environmental initiatives
Changes in external
conditions
Materiality Issues

Building a recyclingoriented society

Societal needs and expectations

Stakeholderfeedback

STEP ❶
Identifying
relevant
issues

Implementing
management concepts
TheDaisekiGroup’spurpose
TheDaisekiGroup’senvironmentalpolicies
Vision2030,theDaisekiGroup’slong-termmanagementvision

17

Preventing environmental
pollution from waste

STEP ❷

Checking risks
andopportunities

STEP ❸

Group-wide call forsuggestions for“materiality phrases”toencapsulate each of
our five priority issues

STEP ❹

Interviews
with investors

STEP ❺

Materiality
assessment(management
meetings, Boardof Directors)

STEP ❻
Continual
review

● Assessing the importance of key issues● Main opinions considered

High●Investors

Importance for stakeholders◦Diversity◦Work-life balance◦Human resources
development◦Carbon neutrality◦Circular economy◦Environmental protection◦Relationship of trust withcustomers◦Health management◦Increasing employee
engagement◦Compliance◦Corporate governance◦Core business share up◦Develop new businesses◦Relationship of trust withlocal communities◦Cooperation with local
governments anduniversities◦Contribution to local
communitiess◦Demonstration of each person’
individuality and abilities◦Philosophy of safety◦Nurturing employees who
work safely◦Safety training◦Equipment necessary forsafety◦Reducing our greenhouse gas emissions◦Contribution to the water cycle◦Disclosure of toxic waste emissions
information◦Strengthening employee education andlabor management◦Protecting human rights◦Introduction of a safety management
system◦Introduction of performance-linked
compensation system◦Strengthening Group company
management◦Vision 2030 target management◦Compliance●Daiseki Group officers and employees◦Realization of a circular economy society◦Promotion of countermeasures for climatechange◦Demonstration of each person’sindividuality and abilities◦Workplaces prioritizing safety where
employees can work with peace of mind
◦Co-existence and mutual prosperity withlocal communities◦Gaining trust through compliance

Low
Low

Importance for the company’s business activities

High● Each Issue’s Connection with the SDGs, Initiatives, and Performance Review
ESG Materiality
Materiality Issues

Priority Issues◦Circular economy

Making the ◦Carbon neutrality
best use of ◦Environmental protection◦Strengthening trusted relationships withlimitedresources
customers as an environment-creatingcompany

FY2023
Initiatives

Impact on
Stakeholder
Daiseki GroupInterest
Operations

We obtained SBTi
certification for ourgreenhouse gas emissions
Extremely Extremely
reduction targets and
high
high
worked toward thesegoals. We received a
B score from the CDP.

◦Health management (employee, family, supply chain)◦Diversity and inclusion◦Work-life balance◦Human resource development (nurturing employees to
win trusts from society and customers as professionals
and to be proud of own job for families)◦Workplace and company you can be proud of for yourfamily (employees and company make safe workplacethat is worth working for without any frauds)

We promoted humancapital management by
formulating a human
Extremely
resources development
Very highhighpolicy and internal
environment
improvement policy.

◦Philosophy to put safety as the top priority

We implemented thoroughaccident-prevention
measures, including
investigations into the root
causes of accidents andsafety patrols of ourcustomers’premises.

Very highExtremelyhighresidents in surrounding area
A company
well-liked by ◦Cooperation with local governments anduniversities in surrounding area
local
communities ◦Company that roots in and contribute to

We furthered our cooperation
with local governments anduniversities by participatingin local government eventsand implementing practicaltraining in cooperation with
universities.

High

High

Promoting◦Compliance of related laws such as thethorough
Waste Management and Public Cleansing
understandingActof compliance◦Employee trainings by compliance study
and observation
sessionsof laws and◦Strengthening
corporate governanceregulations

We worked to increase
employees’knowledge
and awareness of laws
and regulations throughcompliance study sessions
attended monthly by all
employees.

Very highExtremelyhighCreating
workplacethat
individuals
shine

Eliminating ◦Nurturing employees who work safely as
professionals
industrial andenvironmental ◦Danger prediction training, risk assessment
accidents◦Update and expansion of necessary
equipment◦Building relationships and trusts withthe local area through environment

Overarching Aims

Related
Pages

P27
〜36

P37
〜40

P41
〜42

P43
〜44

P45
〜50

18

The Story of Value Creation at Daiseki

Financial and Non-Financial Highlights
Financial Highlights
Consolidated net sales(Millions of yen)

Consolidated capital investment■ Consolidated net sales● Comparison with previous year

75,000（%）
20

51,31350,00054,08856,86751,53058,572

7,500
10

4.3

6,739

6,408
5,000

2.9

10.3

9,978

10,000

5.4
25,000(Millions of yen)

4,038

0

2,754

2,500

△4.7

0

2019

2020

-10

2021

2022

2023

Operating profit, operating profit margin(Millions of yen)

■ Consolidated operating proﬁt

15,00010,000

（%）
30

20.0
17.7

19.8

2019

2020

2021

2022

2023

(FY)

Profit attributable to owners of parent● Operating proﬁt

22.7

0

(FY)

(Millions of yen)

■ Proﬁt●

10,000164.02
137.23

8,000

21.7

119.0820

Proﬁt per share

174.21

(Yen)
180
150

126.97

120

6,000

90
5,000

9,107

10,865

12,940
10,242

12,711

4,000

10

2,000

0

0

2019

2020

2021

2022

2023

■ Dividend

●

80

32.1
60

40

34.0
56

36.7

56

7,044

8,666

6,521

60
30

0

0

2019

(FY)

2020

2021

2022

2023

11.1

11.3

2022

2023

(FY)

Note: Profit per share was calculated with reference to the 1.2-for-1 stock split of common stock carriedout in September 2021, and assumes a stock split at the beginning of FY2019 in line with this.

Dividend, dividend payout ratio
(Yen)

6,110

8,376

Consolidated ROE
Dividend payout ratio

36.5
60

（%）
40

（%）
15

34.4
60

30

10

9.6

10.4
9.0

46
20
5

20
10
0

0

0

2019

2020

2021

2022

2023

(FY)

Note: A 1.2-for-1 stock split of common stock was carried out in September 2021

19

2019

2020

2021

(FY)

Non-Financial Highlights
Quantity of industrial waste received for recycling at Daiseki Group

Daiseki Group Recycling Rate

(10,000 tons)

（%）

250.0
200.0

● Recycling rate*

100

186.7

207.2

194.1

206.1

91.6

180.8

91.1

90

150.0
100.0

90.5

90.0

87.7

80

50.0
70

0

2019

2020

2021

2022

2023

2019

(FY)

Breakdown of Daiseki Group Capital Investment by Purpose (FY2023)■ Scope 2■ Scope 1

4.5
21.7％

Capitalinvestment*

5.4％

2022

2023

1.4
1.0

1.3

0

Environment*
72.9％
-10

△9.4
2.8

2.8

2.8

2021

2022

2023

-20

0
Note: This figure for investment in equipment does not include expenses for the purchase of land
* Capital Investment for environment includes expenditure for recycling promotion,
prevention of pollution, and reduction of CO2 emissions.

Daiseki Group Employees by Gender

1,200

14.9

15.5

（%）
20

15.6

(FY)

Note: Group emissions for FY2019 and FY2020 are undisclosed.

Transition of ratio of Daiseki external directors● Ratio of female employees

16.3

（%）
10

1.5

(Individuals) ■ Female employees■ Male employees
1,600

(FY)

● Scope 1 and 2 emissions previous year

1.5
3.0

Safety2021

Change in Daiseki Group’s Scope 1 + Scope 2 emissions(10,000 tons of CO2)

Others2020

Note: See page 28 for the definition of recycling rate
* In recent years the recycling rate has dropped as we take on challenges to recycle items thatare difficult to treat, and we are currently developing technologies to raise the recycling rate.

15.8

（%）

57.1

60

50.0
15
40

800

156

163

802

848

865

2021

2022

2023

129

141

156

736

771

2019

2020

10

37.5

37.5

2020

2021

20
400

0

5

16.6
0

0
(FY)

Note: Full time employees only (non-regular staffs, contractors, temporary employees,
assignee, part time employees and associate employees are not included)

2019

2022

2023

(FY)

Note: Based on securities report that describes business activities for each fiscal year

20The Story of Value Creation at Daiseki

Daiseki Group’s Performance by Business

Each company within the Daiseki Group is working to create value in the domains of environmental
protection, resource recycling, and the transition away from fossil fuels. In this section, we categorize
our operations into four segments (wastewater, waste oil, and sludge recycling; soil and plasterboard
recycling; lead recycling; oil tank cleaning) and discuss our performance and initiatives for each segment.

Note: Sugimoto Trading Company Co., Ltd. and Sugimoto Paper Industry Co., Ltd., which Daiseki Eco. Solution conducted an
M&A with in March 2023, will be included from next fiscal year.

Consolidated net sales Millions of yen

Consolidated operating profit■ Wastewater, waste oil, and sludge recycling segment ■ Soil and plasterboard recycling segment■ Lead recycling segment ■ Oil tank cleaning segment■ Wastewater, waste oil, and sludge recycling segment ■ Soil and plasterboard recycling segment■ Lead recycling segment ■ Oil tank cleaning segment

34,98933,75331,551

9,739

9,503
8,283

17,082

14,906FY2021

16,411

3,821 4,143

3,230 3,620

2,878 3,143

FY2022

FY2023

Note: Information for wastewater, waste oil and sludge recycling segment is derived from data of DaisekiCo., Ltd and Hokuriku Daiseki Co., Ltd. and information for soil and plasterboard recycling segment
is derived from data of Daiseki Eco. Solution Co., Ltd., Green Arrows Central Co., Ltd. and Green
Arrows Kyushu Co., Ltd. Information for Lead recycling segment is derived data from Daiseki MCR
Co., Ltd. and information of oil tank cleaning segment is derived data from System Kikou Co., Ltd.

1,206

2,102
283 528706 688

FY2021

FY2022

1,373

949 710

FY2023

Positive factors

Negative factors◦High profitability due to superior business model◦High recycling rate
◦Contribution to carbon neutrality◦Network spanning all of Japan◦Wide range of products handled◦Knowledge related to the Waste Management andPublic Cleansing Act, which is difficult to interpret◦High-level emergency response in disastersituations◦Contribution to environmental protection by
purifying wastewater and waste oil◦The circular economy is not yet a core business◦Scope of business is Japan only, and has not
yet expanded overseas◦Smaller business scale and limited businessscope compared to major companies outsideJapan

Strength

Internal factors

Opportunity

External factors
21

Millions of yen◦Increase in customers who demand carbon
neutrality◦Growing necessity of the circular economy due
to high resource prices◦Growing interest of the international community
in biodiversity and the water cycle◦High barriers to entering the waste disposal
industry in Japan due to the Waste
Management and Public Cleansing Act

Weakness

Threat◦Shrinkage of the Japan industrial waste market
due to stagnation of the Japanesemanufacturing industry◦Increase in energy costs due to tightening ofcarbon-neutrality regulations◦Barriers to expanding business due to the strict
provisions of the Waste Management andPublic Cleansing Act and differinginterpretations of this Act by each local
government

Introduction of Group Companies
Daiseki Eco. Solution
Hiroya Yamamoto

President and Representative Director

Our soil segment cleans and recycles soil contaminated by civilengineering works. Recycled soil is used as a construction material and a
raw material for cement. In the plasterboard field, we collect plasterboard
from demolition sites, separate its components, and recycle it into recycledplasterboard and raw materials for cardboard and recycled paper.
Going forward, we will reliably handle large-scale construction projects in
the Tokyo metropolitan area, the Chubu region, and the Kinki region, andwork to strengthen upstream sales and consulting business. In May 2023,
we augmented treatment facilities at our used plasterboard works. We arepromoting further expansion of the used plasterboard recycling business.

Daiseki MCR
Tadashi Hongo

President and Representative Director

Daiseki MCR collects used batteries and separates, dissolves and smelts theircomponents to recycle them into lead ingots. The lead ingots are used by battery
manufacturers. Daiseki MCR is focusing on reducing greenhouse gas emissions in
response to customer demand. In consideration of the large amounts of CO2 thatare emitted in the lead smelting process, in 2014 the company adopted the useof LNG instead of coke, resulting in an approximately 60% reduction of emissions.
This was followed in March 2022 by a switch to carbon-neutral LNG.
Looking ahead, we will develop businesses that can contribute both to thecircular economy and carbon neutrality.

System Kikou

Tsuneyasu Tanaka

President and Representative Director

System Kikou carries out cleaning works and similar operations for oiltanks and tankers’internal storage tanks, collecting the crude oil sludge
accumulated inside the tanks. Our cleaning technologies and systems are
considered industry-leading both in Japan and overseas.
Until now, large oil tanks were the main target of the company’s business,but now, in cooperation with Daiseki, tanks located in manufacturing plants
are also targeted. We would like to go forward further strengthening thesynergies of the Group.

Hokuriku Daiseki
Katsuya Mishima

Representative Director

Hokuriku Daiseki manufactures and sells mold release agents for concrete
products; special machine oils, cutting oils, and industrial lubricants; and rust
inhibitors to prevent rusting of metal parts and machinery. We also collectwaste oil and recycle it, processing it into process oils or similar products
depending on its composition and properties. Waste oil recycling has been apart of Daiseki’s efforts since the company’s founding, and we consider it tohave been a precursor to what is now known as the circular economy. We
are committed to further revitalizing our business and to cooperation with therest of the Daiseki Group, founded on a philosophy of effectively utilizing the
Earth’
s finite resources.

22

Special Feature 1: A Conversation with Top Executives in Our Sales Departments

The overarching sales departments goals of the Daiseki Group,
which continues to create value as a part of the“venous industry”
The continued growth and development of the Daiseki Group as an environment-creating company
requires not only technological capabilities and knowledge—high level sales knowledge to respondto customers in all business areas is also essential. In this conversation, the top executives in oursales departments at Daiseki and Daiseki Eco. Solution provide explanations of our initiatives.

Daiseki Group’s resource recycling
solutions for the age of carbon neutrality― In sales have you felt there are new needs
pertaining to the SDGs and ESG investment?
Amano: Yes, I feel that demand for Daiseki’s recycling,which addresses the needs of the age of carbon
neutrality, is growing day by day, and we areexperiencing an unprecedented tailwind. Customers
choose us because of our high recycling rate andour technological capability of disposing of waste inenvironmentally friendly ways. In particular, our nonburning recycling process is a major appeal point forcustomers who are carbon neutrality oriented.

Ryuji Suzuki
Senior Managing Executive Officer & General Manager of Headquarters ofEnvironmental Business in charge of the Eastern Japan area, Daiseki Eco. Solution
Appointed as a director in 2007. Served as a director of System Kikou from2010 to 2013. From 2013 served as Deputy General Manager and then General
Manager of Daiseki Eco. Solution’s Headquarters of Environmental Business.
Took on his current role in 2022.

23

Suzuki: I’
ve also been feeling the same thing. At
Daiseki Eco. Solutions we have many customers in theconstruction industry, and requests for environmental
considerations, such as treatment of contaminated soil,
are on the rise from their clients in the manufacturing
and other industries. There is strong business in the
manufacturing industry, and there are many excellent
companies that have preemptively taken
environmental and resource related measures. The
construction industry is following suit, for example bychoosing environmentally friendly recycled materials,
and we are beginning to see a virtuous cycle.
Amano: There are also increasing carbon-neutrality
needs among major companies in the manufacturingindustry. Daiseki has long marketed recycling
processing services and recycled products with low
C O2 e m i s s i o n s , a n d i s n o w c o n s i d e r i n g t h edevelopment of new products that can contributeto carbon neutrality.
Daiseki has also received a B score from the CDP（climate change）, and we are aiming to further improve
our score in the future. This is an evaluation from anorganization which provides environmental ratings andhas a high level of global influence, which I believe will
work in Daiseki’s favor in our sales activities.
― What is required for venous industry to contributeto the circular economy and sustainability?
Amano: We need to deepen cooperation between
customers in the arterial industry, which generates
waste, and the venous industry, which recycles it.  
Even waste that is not currently recyclable could be
reusable with creative sorting and processing methods
by customers in the arterial industry. A kind ofcooperative framework in which the venous industry
provides know-how to be utilized by the arterial
industry to expand the scope of recycling, is key. To
this end, it is also necessary to have clear motivationon the arterial industry side. It will be necessary todemonstrate benefits commensurate with the costs,
or legal regulations to create a country-wide system.
Suzuki: The cost of disposing of contaminated soil andindustrial wastes can be a factor that puts pressure on
a company’s business. Therefore, I believe policies
such as subsidy programs for environmental restorationcosts and tax incentives would also be effective.
Amano: An urgent matter that we must consider is thecreation o f a s y s t em t o rec y cl e w as t e-deriv ed
materials such as waste plastic and scrap inside Japan,
rather than shipping them to other countries. Japan isa country with few natural resources. There would beconsiderable economic benefits if we could recycle
such waste into raw materials in Japan.
Suzuki: Waste is being shipped outside of Japan. This isbecause the price of such waste is higher in othercountries. We would like to pursue a system by whichhigh quality scrap and other strategic resources can beprocured within Japan.

Daiseki’s DNA: Creating new value as
waste recycling professionals― What do you think the Daiseki Group’s strengths
are in terms of sales?
Amano: Number one is trustworthiness, and thisapplies to both of our companies. In the unlikely
event that a waste disposal company violates the
Waste Management and Public Cleansing Act, itscustomer will be strictly held liable as the emitting
business. Daiseki is a trusted company, with anunwavering track record of strict compliancespanning approximately half a century.
Suzuki: Second is our ability to respond to the diverse
needs of customers in the manufacturing industry.
Third is the fact that we practice in-house
operations to provide one-stop solutions. Our DNA
is rooted in the idea of providing added value towaste through our own efforts and ingenuity.
Amano: That’s where our pride as waste recycling
professionals lies. In times of disaster or accident, we
respond to requests from the national government
and municipalities to resolve waste and pollution
related issues. Even in the event of major disasters
such as the Great East Japan Earthquake, Daiseki
immediately hastened to the affected areas andsupported the relief efforts.
Suzuki: The quality of mobility is something to be
proud of. We take pride in how quickly we grasp
customer needs and make proposals, makearrangements and carry out work, and make practicaldecisions as an organization. This speediness is acore competence of competitiveness.
― What is the goal of strengthening sales collaboration
between Daiseki and Daiseki Eco. Solution?
Suzuki: U p u n t i l n o w , w e h a d a s o r t o f p a s s i v ecollaboration in which we contacted each otherwhen there was a request from a customer. Moving
forward, we will conduct screenings of customer
segments having latent needs so that we canactively provide them with the knowledge that theDaiseki Group possesses. The aim is to strengthen
our presence and increase customer satisfaction.
Amano: T h e a i m i s t o s t r e n g t h e n o u r o n e - s t o p
solutions. For example, when a Daiseki customer
relocates a plant, it is necessary to remediate thesoil of the plant site. Therefore, we started an

initiative in which Daiseki sales representatives areaccompanied by a sales representative from Daiseki
Eco. Solution when meeting with customers who
may have soil remediation needs.
Suzuki: In order to satisfy the needs of our customers,
we are taking various measures, such as inventorying
customer information, making joint visits andproposals to relevant customers, and monitoringorganizational processes via the introduction of KPIs.

Future sales efforts for the growth of
Daiseki Group― What do you think is required of Daiseki andDaiseki Eco. Solution in terms of sales?
Amano: We must maintain the ability to think freely
without being bound by preconceived notions. The
needs of environmental businesses are changing at a
dizzying pace. I believe that our mission is to contributeto society with services that are one step ahead bybeing keenly perceptive of these changing needs.
Suzuki: For Daiseki Eco. Solution, it is securingresources. As a core member of the soil contamination
and related industrial waste industry, we receive alarge number of inquiries; however, we are facing theissue of not being able to respond to all of theserequests. In order to improve the quality of ourconsulting services and actual operations, we arelooking to scale up the training and development ofinternal and external employees, as well as
collaboration with strategic partners.

Koji Amano
Director & Senior Managing Executive Officer, Deputy General
Manager of Headquarters of Business Generalization, Daiseki
Appointed as a director in 2003. From 2000 to 2020 served as
the head of Daiseki’s Kyushu, Kanto, and Kansai works. Took on
his current role at Daiseki in 2020.

24

Special Feature 2

Daiseki Group’s Capital Investment
As the global trend toward carbon neutrality enters full swing, we have seen a further increase insocietal support for Daiseki’s recycling-centric treatment methods and recycled fuels. Against thisbackground, we are implementing large-scale capital investment with an eye to medium- and longterm growth. In the Kanto and Kansai regions, which have large-scale markets of which the DaisekiGroup has a relatively low share, we are focusing on proactive capital investment and sales
activities to expand our business.

Trends in Capital Investment by Segment Millions of yen

Breakdown of Daiseki Group Capital Investment by Purpose (FY2023)■ Wastewater, waste oil, and sludge recycling segment ■ Soil and plasterboard recycling segment■ Lead recycling segment ■ Oil tank cleaning segment
5,336

2,664

Others21.7％

Safety5.4％

Capitalinvestment*

Environment*
72.9％

1,800
608

1,038
203 143

203 133

FY2021

FY2022741 545

117

FY2023

Note: Information for wastewater, waste oil and sludge recycling segment is derived from data of Daiseki Co., Ltd and Hokuriku
Daiseki Co., Ltd. and information for soil and plasterboard recycling segment is derived from data of Daiseki Eco. Solution Co.,
Ltd., Green Arrows Central Co., Ltd. and Green Arrows Kyushu Co., Ltd. Information for Lead recycling segment is derived
data from Daiseki MCR Co., Ltd. and information of oil tank cleaning segment is derived data from System Kikou Co., Ltd.

Note: This capital investment amount does not include the costof land purchases.
* E nvironment includes initiatives for the purpose of promoting
recycling, preventing pollution, and reducing CO2 emissions.

Major capital investment in FY2023● Newly established Kansai Works Harima Recycling Center (Daiseki)
Harima Recycling Center, which manufactures supplemental fuelsfrom waste solvents and other materials, was completed in January
2023. Recycled supplemental fuels shipped from Harima Recycling
Center is used as an alternative to coal by customers in the
manufacturing industry in the Kansai region. We plan to continue
adding to the facilities at Harima Recycling Center, in addition to the
supplemental fuel plant.
Recycled supplemental fuel plant at Harima Recycling Center● Newly established Hiroshima Works (Daiseki)
Our goal in newly establishing our Hiroshima Works is to increase ourshare in the markets of Japan’s Chugoku and Shikoku regions, locatedbetween our Kansai Works and Kyushu Works. The land was acquired inAugust 2021 and plant construction began in January 2023. This works isscheduled to begin operations in March 2024. A plant for recycling waste
solvents and other materials into supplemental fuels will be constructed at
the Hiroshima Works. We plan to sell these supplemental fuels primarily tocustomers in the manufacturing industry in the Chugoku and Shikoku regions.

25

Hiroshima Works under construction

● Enhancing treatment facilities at Kyushu Works (Daiseki)Inordertorespondtothedemandforsupplementalfuels,we
investedover2.5billionyentobuildanewsupplementalfuelplantat
ourKyushuWorks.
Thisnewsupplementalfuelplanthasthecapacitytoprocess
1,584m3ofwasteoilperday.Wewillusethisfacilitytobolsteroursalesactivitiesandmeetcustomerexpectationsmorefullythanever
before.
SupplementalfuelplantatKyushuWorks● Newly established industrial waste treatment facility (Daiseki MCR)
EstablishinganindustrialwastetreatmentfacilityattheHiraidePlant
inJanuary2023andacquiringalicenseforspeciallycontrolledindustrial
wasteenabledustocompleteintermediate-stagetreatmentofwaste
leadbatteriesatonelocation.
Byintroducingfacilitiesforcleaningandshreddingplastic,theplastic
containersofthewasteleadbatteriescannowberecycledinto
recycledplasticmaterial.Thiscutting-edgeintermediate-stagetreatment
facilitywasdesignedwithconsiderationfortheSDGsandreduces
IndustrialwastetreatmentfacilityatDaiseki
environmentalimpact.
MCR’sHiraidePlant
Sincethissafe,cleanrecyclingfacilityrespondstothedemandfor
treatmentofindustrialwasteleadbatteriessuchasthosefor
uninterruptiblepowersupply(UPS),itwillcontributetothecreationof
acirculareconomysociety.

Future capital expenditure plan with a focus on Vision 2030
Today,thereisagrowingdemandfortheproper
treatmentandrecyclingofindustrialwaste,whichis
becomingincreasinglydiversifiedandcomplex.AsaGroup,weareworkingtoexpandourbusinessto
addressthis.Specifically,weareimprovingour
technicalcapabilities,expandingthenumberofitems
thatcanbetreatedandrecycledbyintroducingnew
equipment,andproactivelyinvestingcapitaland
expandingsales,withtheaimofincreasingourmarketshareespeciallyinthetwolargemarketsof
KantoandKansai.
FollowingtheHiroshimaWorks,whichiscurrently
underconstruction,weplantobuildnewworksinthesouthernKantoandTohokuregions,wherewearesearchingforsuitableland,assoonasthereare
prospectsforcommercialization.
Wearealsonowconsideringlaunchingthreenew
businessesthatwouldgeneratesalesof
around15billionyen.Regardingthis,we
plantoinvestcapitalassoonasthereareprospectsforcommercialization.

DaisekiHeadquarters
DaisekiWorks
NewDaisekiWorks
(plannedorunderconstruction)
Groupcompanies(headquarters)

26

ESG Reporting

E Environment
Environment

As a venous enterprise running through society feeding into manufacturing and other arterial
industries, Daiseki recycles industrial waste to the fullest extent possible, utilizes resources
eﬀectively and strives to reduce environmental burdens in the waste treatment process.

Promoting Environmental Management
Developing environmentally friendly operations
through an environmental management system

Formulation of an Environmental Policy
and its dissemination to employees

TheDaisekiGrouphasestablishedanenvironmental
managementsystemdeliveringenvironmental
managementledbyourPresident.OurEnvironmental
Headquarters,comprisingDaisekiandourGroup
companymanagementteams,deliberatesonand
makesdecisionsregardingprioritymattersconcerningenvironmentalprotectionandclimatechange.

T h e D a i s e k i G r o u p h a s e s t a b l i s h e d a nEnvironmentalPolicybasedontheGroup’sshared
coreprinciplesandbringingtogetherthecorepolicies
g u i d i n g e n v i r o n m e n t a l
initiativesateachofourgroupcompanies.Daisekiis
raisingemployeeawarenessofourEnvironmentalPolicy
amongallstaffandworkingtoachieveourtargetsasa
companyaimingtocreateabetterenvironment.

Structure of the Daiseki Group Environmental Management System
Daiseki President andRepresentative Director
Company-wide
internal auditors

Daiseki Eco. Solution
Daiseki MCR

Our system for monitoring compliancewith environmental laws and regulations

Environmental
Headquarters
Environmental
Task Force

System Kikou

TheDaisekiGroup’sEnvironmental
policies

General Manager,
Environmental Management

Hokuriku Daiseki

Planning Division,
Planning andManagement
Headquarters

Manager, Environmental WorksManagerManagement

Works
ManagerWorks
ManagerWorks
ManagerWorks
ManagerWorks
Manager

Headquarters/Nagoya Works

Hokuriku Works

Kansai Works

Kyushu Works

Kanto Works

Chiba Works

Daiseki,DaisekiEco.Solution,andDaisekiMCR
haveacquiredISO14001certification.InFY2023,the
DaisekiGroupreceivednoadministrativesanctions(ordersforimprovement,ordersforaction,or
businesssuspensionorders)undertheAirPollution
ControlAct,theNoiseRegulationAct,ortheOffensive
OdorControlAct.Additionally,weincurrednofinesorpenaltieswithregardto
environmentalmatters.

ISO14001ManagementSystem
RegistrationCertificate

27

ESG Reporting
Environment

Key environmental achievements in FY2023 (Daiseki Group)
Amount of materials
received for recycling

Recycling rate

2,061,000 tons

87.7％

(1,070,000 tons)

Note: (

（87.1％）

CO2 total emission(Scope 1 and 2 only)

38,000 tons of CO2(27,000 tons of CO2)

) shows the number with Daiseki only

Perspective of the environmental load by Daiseki Group’s recycling business
INPUT
Amount of materials received for recycling
Others 12.4%
Used
lead-acidbatteries
1.0%

Waste oil
19.9%

Supplemental materials

118,000 933,000
tons

Waste, etc.
(raw material)

2,061,000
tons

Sludge13.4%

Contaminatedsoil 34.4%

Raw material for petroleum productsklDaiseki Group

Daiseki Group
Recycling Rate

87.7

Waste oil treatment Treatment of waste acids and waste alkalis

Diesel fuel55,716MWhOthers21,288MWh

tons

Recycled water (rainwater)

2,000 31,000

Waste alkali 11.4%

Waste acids 7.5%

EnergyWater

Heavy oil B(recycled
heavy oil)
15,231MWｈ

156,247
MWh

City gas
29,167MWｈ

tons

Electric
25,996MWh
Electric(shows electric power from renewable energy) 8,849MWh

Sludge treatment

Contaminated soil treatment

Lead recycling

Waste oil

Waste acid and waste alkali

SludgeContaminated soil

Used lead-acid batteries

Recycled fuels(recycled heavy oil/
supplemental fuel)Raw materials for cement(from waste)

Raw materials for cement(from waste)

Raw materials for cement(from contaminated soil)

Recycled lead

Usable metals, etc.

Purification & discharge(purification & discharge
after dehydration)%

Amount of materials received for recycling—intermediate treatment residue (non-recyclable)
X100
Amount of materials received for recycling

Waste
collection
Petroleum productmanufacturing

Purification/discharge

OUTPUT
Recycled products shipment

Drainage to sewer or rivers/other bodies of waterIntermediate treatment residues (non-recyclable)

Recycled fuels:

239,000 tons

Purification & discharge (sewer discharge) 937,000 tons

Raw materials for cement (from waste):

239,000 tons

Purification & discharge (river discharge) 320,000 tons Final disposal (landfill) 243,000 tons

9,000 tons

Purification & discharge (ocean discharge) 68,000 tons

Raw materials for cement (from contaminated soil):399,000 tons

Note: Discharged after purifying to the value under standard

Useable metals and similar: Recycled lead:
Other recycled materials:

Incinerated

11,000 tons

Note: Intermediate treatment residue is outsourced

Petroleum products

2,000 kl

12,000 tons

Emission into the air

322,000 tons

CO2 total emission 38,000 tons of CO2

28

ESG Reporting
Environment

The Three Pillars of Environmental Protection
Environmental
 Protection
Pillar

1 Maintaining a high recycling rate

The Daiseki Group receives wastes such as waste oils, waste
acid/alkali, sludge, contaminated soil, and used lead-acidbatteries from our customers and recycles them into recycled
fuel, raw materials for cement, usable metals, recycled lead, etc.

Recycling rate
(FY2023)

87.7%

Note: See page 28 for a definition of recycling rate

Environmental
 Protection
Pillar2

Contributing to the realization of a circular
economy by promoting effective resource cycles

The Daiseki Group promotes activities aimed at realizing a circular economy society in order to protect
the environment, secure natural resources, and build a sustainable society. Demand for circular
economies is rising to recycle waste into resources in order to ensure the stable supply of natural
resources and to prevent environmental pollution and adverse impacts on biodiversity from mining. Our
Group is promoting initiatives to realize a circular economy society by recycling industrial waste into
various resources.

Output amounts of major recycled resources by Daiseki Group in FY2023
Recycled resources

FY2023 output amount

Alternative natural resources

Raw materials for cement

638,000 tons

Limestone

Recycled fuels (recycled heavy oil/supplemental fuel)239,000 tons

Heavy oil, coal

Usable metals, etc.

9,000 tons

Metal resources, agents, etc.

Recycled lead

12,000 tons

Lead

Raw materials for plasterboard

96,000 tons

Plaster

Raw materials for
cement29

Recycled fuels

Usable metals, etc.

Recycled lead

Raw materials forplasterboard

ESG Reporting
Environment

Environmental
Protection
Pillar

3 Waste treatment with low greenhouse gas emissions

InMarch2023,theGXLeaguedrewup
itsBasicGuidelinesforDisclosureand
E v a l u a t i o n o f C l i m a t e - r e l a t e dOpportunities,whichincludeadefinition
oftheconceptof“avoidedemissions.”
D a i s e k i h a s b e e n i n v o l v e d i n t h eformulationoftheseGuidelines.They
indicatetheextenttowhichcompany’s
productsandserviceshavecontributedto
loweringemissionsacrosssocietyasa
whole.Daisekiisabletooffertreatment
methodswithlowerCO2emissionsthan
incineration.Inthecategoriesofwasteoil
andsludge,forexample,outsourcingrecyclingandtreatmenttoDaisekireduces
ourcustomers’
Scope3Category5
( W a s t eG e n e r a t e di nO p e r a t i o n s )emissionstozero,*1allowingthemto
reportlowerScope3greenhousegas
emissionstoCDPandotherenvironmental
ratingsagencies.
Daisekihassetatargetofachieving
avoidedemissionsofatleast680,000
tonsofCO2byFY2025.

Comparison when treating one ton of waste oil
2,920kgofCO2

99.1% reduction(Trial calculation based on FY2023 processing results)

Avoided emissions of

116,000 tons of CO2

27.4 kg of CO2
Incineration
without othertreatments*2

Daiseki’s oil-water separationand fuel-conversion treatments*3(recyclingintorecycledheavyoil)

InFY2023,Daisekidelivered

40,000 tons of recycled
heavy oil

Comparison when treating one ton of waste solvent
1,691kgofCO2

97.7% reduction(Trial calculation based on FY2023 processing results)

Note:ThefollowingtrialcalculationsarebasedonFY2023results
forouroil-waterseparationandfuelconversiontreatments,
twoofourmainprocessingmethods.Thesetheoretical
figuresestimatethereductioninCO2emissionseffectedby
ourtreatments,ascomparedtoascenarioinwhichour
customerssimplyincineratetheirwaste.
*1T heDatabaseonEmissionsIntensityforAccountingofGreenhouseGasEmissions,etc.,byOrganizationsThroughouttheSupplyChain(Ver.3.1),publishedbytheMinistryofthe
Environment,setstheemissionsintensity(quantityofgreenhousegasemissionsperagivenunitofactivity)for
recyclingofwasteoilandsludgetozero.
*2C alculatedonthebasisofCO 2issuingfromthecarbon
containedinwaste(basedonemissionsfactorsfromthe
MinistryoftheEnvironment’sGreenhouseGasEmissions
AccountingandReportingManual).
*3C alculatedbytotaling1–3below(fromDaisekiFY2023
processingresults) 1.CO2generatedthroughfuelconsumptionbyboilersusedforoil-waterseparation
 2.CO2calculatedaccordingtotheamountofelectricityusedforneutralization,biologicaltreatment,andotherprocesses 3.C O 2equivalentsoftheCH 4andN 2 Ogeneratedby
wastewatertreatment*4CO2emissionsfromincinerationwithoutothertreatmentsare
calculatedbymultiplyingthewasteoilemissionfactorbythewastesolventratio,assumingthatthe268,000tonsofmaterials
receivedforrecyclingforsupplementalandotherfuelsin
FY2023wasamixtureof148,000tonsofwastesolvent,with
wateraccountingfortheremaining120,000tons.Thesefigures
fluctuateeveryyeardependingontheratioofwastesolventto
waterinthematerialreceived.
*5CO2calculatedaccordingtotheamountofelectricityusedfor
fuel-conversiontreatments,basedonDaiseki’sFY2023
processingresults*6Inthemid-termmanagementplan,itisexpectedthatDaiseki’snonconsolidatednetsalesforFY2025willbe120.55%comparedto
FY2022.ThetargetwassetbasedonanassumptionthattheeffectofreductionofCO2emissionisproportionatetothenetsales.
*7InFY2022,annualCO2emissionsperhouseholdwere2.74tonsofCO2(accordingtotheFY2022SurveyonActualCO2EmissionsintheHouseholdSector）

Avoided emissions of

443,000 tons of CO2

37.3 kg of CO2
Incineration
without othertreatments*4

Daiseki’s fuel conversion
treatments*5(recyclingintosupplementalfuel)

Avoided emissions ofSupplemental fuelsdelivered by Daiseki

268,000 tons

inFY2022:

559,000 tons of CO

2(EquivalenttotheannualCO2emissionsof200,000households*7)

Target by FY2025:
Avoided emissions of

680,000 tons of CO *(EquivalenttotheannualCO2emissionsof240,000households* )
7

2

6

30

ESG Reporting
Environment

Climate Change Scenario Analysis
Daiseki has established a Risk Management Committee and conducts risk management every quarter, including
assessment of climate change risk. Consideration of risk impacts and frequencies is not sufficient to give a full
picture of climate change risk, so we are conducting analyses of set scenarios.

Projected 4.0°
C Scenario●A mount of greenhouse gas emission is large with insufficient countermeasures, and in 2100
the air temperature will rise in 4℃ compared to the temperature in industrial revolution
In this scenario, there is a lack of clarity aroundpolicies aimed at decarbonization, and carbon
pricing and other regulations on fossil fuel usage are
not strengthened. Although businesses become
more aware of decarbonization to some degree,
they do not choose low-carbon products at theexpense of raising their costs. In this situation,energy costs do not change. With no reduction in
Possible Situation
Lack of clarity on greenhouse gas
emissions regulations

fossil fuel usage and demand for recycled fuels
expected to be unchanged, Daiseki expands ourrecycling operations in this category. In response topredictions of increase in number of weather
disasters over the medium to long term and thepossibility that these could damage our customers’
works, Daiseki develops systems to provide
reconstruction support.

Impact Assessment
No change in energy costs

Response
Remains at current level

Opportunity: Somewhat increased demand for
Expanding our industrial waste treatment
Daiseki’s low-emissions industrial
business operations
waste treatment services

Businesses’emissions reduction
4.0℃
efforts have increased somewhat
Scenario
Opportunity: Somewhat increased demand for(Little to norecycled fuelsintervention)
Increased severity of typhoons, torrential Risk: Disasters force Daiseki and/or ourrain, and other natural disasters
customers to cease operations
Rising sea levels and other changes
in the marine environment

Risk: Flooding forces Daiseki and/or ourcustomers to cease operations

Expanding our recycling operations in therecycled fuels category
Disaster prevention measures and securing
our supply chain
Implementing measures during times ofincreased flood risk

Projected 1.5°
C Scenario● Temperature rise in 2100 will be within 1.5℃ with strict policy for climate change introduced
In this scenario, greenhouse gas emissions
regulations such as carbon pricing systems and carbon
taxation are adopted, resulting in increased energy
costs, so we respond by adopting the use ofrenewable energies and deploying low-emissions
vehicles and processing equipment. Fossil fuel usage
also decreases, lowering demand for recycled fuels inturn and bringing expectations of decrease in sales.
Conversely, demand for our low-emissions industrial
Possible Situation

waste treatment services and raw materials increases.
In anticipation of this kind of paradigm shift, Daiseki
will shift our focus to material recycling. Material
recycling is the recycling of waste into products
retaining close to their original functionality. This
removes the need for the incineration or landfill thatwould be required for disposal and avoids using
natural resources, thereby allowing us to contribute todecarbonization and resource recycling.

Impact Assessment

Greenhouse gas emissions regulations
are strengthened (carbon pricing systems Risk: Increased energy costs
and carbon taxation are adopted)

1.5℃
Scenario(controls
applied)Advances in businesses’emissions
reduction efforts

Response
Adopting use of power by renewableenergies and low-emissions equipment

Risk: Reduced fossil fuel usage
⇒ Reduced sales of recycled fuels

Shifting operations from recycled fuels tomaterial recycling

Opportunity: Increased demand for Daiseki’slow-emissions industrial waste
treatment services

Proactively expanding our industrial waste
treatment service operations

Opportunity: Increased demand for recycledresources with low emissions

Shifting operations from recycled fuels tomaterial recycling

No change in likelihood of typhoons,
No change in risk of disasters forcing Daiseki
Remains at current leveltorrential rain, and other natural disasters and/or our customers to cease operations
No change in the marine environment No change in risk of flooding forcing Daiseki
Remains at current levelsuch as rise in sea levels
and/or our customers to cease operations

31

ESG Reporting
Environment

Analysis of the Financial Impact of These Risks and Opportunities on Our Business Activities● 4.0℃ Scenario
JPY10,000 million yen
Increased profit from new business (market opportunity)
JPY5,000 million yen

Positivefinancial
impact

JPY9,000 million yen
JPY450 million yen
FY2023–FY2030 (short-term)
JPY211 million yen

Negativefinancial
impact

JPY280 million yen

JPY15,000 million yen
Increased profit from industrial waste treatment and recycling business(market opportunity)
JPY1,125 million yen
Increased profit from sales of recycled fuels (market opportunity)
FY2031–FY2050 (medium-term)

From FY2051 (long-term)

Increased energy costs due to carbon pricing systems (regulatory risk)
JPY1,150 million yen

Reduced profit due to halt in operations caused by natural disaster(acute physical risk)
JPY1,269 million yen
JPY 2,538 million yen● 1.5℃ Scenario
JPY20,000 million yen
Increased profit from new business (market opportunity)
JPY5,000 million yen

Positivefinancial
impact

JPY29,000 million yen
JPY9,000 million yen
JPY270 million yen
Increased profit from sales of recycled fuels (market opportunity)
FY2023–FY2030 (short-term)
JPY328 million yen

JPY280 million yen

Negativefinancial
impactIncreased profit from industrial waste treatment and recycling business(market opportunity)

FY2031–FY2050 (medium-term)

From FY2051 (long-term)

Increased energy costs due to carbon pricing systems (regulatory risk)
JPY2,544 million yen
Reduced profit due to halt in operations caused by natural disaster(acute physical risk)
JPY560 million yen

Reduced profit from sales of recycled fuels (market risk)
JPY900 million yen

Note: P ositive and negative financial impacts that affect operating profit of the year are calculated. For the basis of
calculation, see“ Basis of calculation of financial impact to business activities with risks and opportunities.”

32

ESG Reporting
Environment

Management Strategy Based on Our Scenario Analysis

Environmental Policy

Materiality Issues

Long-Term Management Vision

Management
policyDaiseki Planning andManagement
Headquarters

Reporting on the resultsof our activities

Review of scenario analyses

Daiseki s eachWorks and each Group
company

Management level(Sustainability Headquarters,
Management Meeting,Board of Directors)

Incorporation into our
Medium- to Long-Term Business Planand Annual Business Management Policy

Sustainability Headquarters
In order to achieve business growth while mitigating our impact on the global environment, our Sustainability
Headquarters, which is composed of executive officers including the Daiseki president and the presidents of Group
companies, deliberates on policies to address environmental issues based on TCFD scenario analysis andmonitors progress. Please refer to the organizational charts outlining our environmental management system (p.27)
and corporate governance system (p.45) to find out more about the positioning of the Sustainability Headquarters
within the Company.

Linking sustainability management results with compensation
Compensation for internal directors and executive officers follows a basic policy that links their compensation
with shareholder profits as an incentive to sustainably increase corporate value and enhance the practice andpromotion of sustainable management, and sets appropriate compensation levels for each director andexecutive officer based on their responsibilities. As an initiative to achieve SBTi targets, we establish internal
emissions reduction targets for each Works based on ISO 14001. Directors and executive officers who achievethese Works targets receive stock-based compensation.

33

ESG Reporting
Environment

Greenhouse Gas Emissions Reduction Targets and Results
Daiseki Group’s established greenhouse gas reduction targets were certified by the Science Based Targets
initiative(SBTi)*1 in November 2022 as meeting the“Well-below 1.5℃”target based on scientific evidence. The
established targets are as follows.

❶ Scope 1*2 + Scope 2*3

34% reduction by FY2028 (compared to FY2022)❷ Scope 3*4

20% reduction by FY2028 (compared to FY2022)❸ Switching to power from renewable energy sources Switching to100% power from renewable energy sources by FY2031*1 SBTi: SBTi is a joint international initiative established in 2015 by the CDP, the UN Global Compact, World Resources Institute (WRI), andWorld Wide Fund for Nature (WWF) to verify and certify that greenhouse gas emissions reduction targets set by companies are sciencebased and in line with the Paris Agreement goal of“limiting global temperature rise to well below 2°C above pre-industrial levels.”*2 Scope 1: Direct emissions associated with fuel use*3 Scope 2: Indirect emissions associated with the use of electricity and heat purchased from other parties*4 Scope 3: Indirect emissions other than Scope 1 and 2

The Daiseki Group’s medium- to long-term targets for greenhouse gas emissions reduction
Reduction targets for total emissions under Scopes 1 and 2 (10,000 tons of CO2)

Reduction targets for total emissions under Scope 3 (10,000 tons of CO2)

4.2

15.3
11.2

2.6

Reductionof 34%
Base year
FY2022

Target year (mid-term)
FY2028Reductionof 20%

0

Target year (long-term)
FY2051

Base year
FY2022

Goal year
FY2028* In the process of obtaining SBTi certification, the total for Scope 3 emissions and the reduction targets for Scope 1/2 and Scope 3 wererevised upwardly.

FY2023 greenhouse gas emissions figures at the Daiseki Group

Emissions (10,000 tons of CO2)

Scope 1
Direct greenhouse gas emissions by
the Daiseki Group(from energy sources only)

Scope 2
Indirect emissions associated with the use of electricity,heat, and steam supplied by other companies(electricity only in the case of the Daiseki Group)

Scope 3
Indirect emissions not covered by Scopes 1 and 2(other companies’emissions related to businessactivities of the Daiseki Group)

2.8

1.0

15.7

Engagement with customers and our supply chain
We are promoting engagement in the following ways with the aim of reducing emissions.
●Customers that commission waste treatment to Daiseki
Reduce Scope 3 category (5) emissions (waste) by utilizing our non-combustible waste treatment methods.
●Customers that purchase our recycled products
Reduce Scope 1 and Scope 3 category (1) emissions (purchased products and services) by using Daiseki’srecycled products, which are alternatives to fossil fuels and natural resources.
●Transportation companies that Daiseki commissions to transport raw materials and products and treatmentcompanies that Daiseki commissions to process residues from waste treatment
W e gather fuel efficiency data from transportation companies to calculate emissions. Meanwhile, we areconsidering an initiative with such companies aimed at reducing emissions

34

ESG Reporting
Environment

Carbon neutrality initiatives● Switching to power from renewableenergy sources (Daiseki Group)
In order to reduce greenhouse gas emissions
associated with our business activities, the DaisekiGroup began, ahead of the schedule set out in our
SBTi target switching to the use of energy fromrenewable sources (renewable energy) in FY2022. We
plan to introduce the use of renewable energy at all
Daiseki Group facilities and in all of our Group
companies by FY2028, reducing our Scope 2 emissions
to zero. In FY2023, Daiseki, Daiseki Eco. Solution, andDaiseki MCR began using renewable energy, and25.3% of the electricity used by the Daiseki Group was
switched to renewable energy.
The Daiseki Group has registered and announced
this plan as part of the RE Action—Declaring 100%
Renewable initiative.

● Reducing electricity use by introducing
turbo blowers (Daiseki Nagoya Worksand Kanto Works)
In FY2023, a turbo blower was introduced to eachof the activated sludge facilities of Daiseki’s NagoyaWorks and Kanto Works. Since activated sludge
facilities supply air to activated sludge, thesefacilities use a large amount of electricity. By
installing turbo blowers with high energy efficiency,
we were able to reduce the electricity used in thesefacilities by approximately 20%.

RE Action—Declaring 100% Renewable initiative logo mark●R eceiving a B score from the CDP(Daiseki Group)
In FY2023, the Daiseki Group received a B scorein response to our information disclosure throughthe CDP Climate Change 2022 Questionnaire, whichis the same score as the previous fiscal year. In
FY2023, we promoted Task Force on Climaterelated Financial Disclosure (TCFD) scenario
analysis, financial impact analysis of businessactivities by risk and opportunity, third-party
verification of Scope 3 greenhouse gas emissions,and the introduction of energy conservation andrenewable energy. In FY2024, we will further reduce
emissions through the introduction of renewableenergy and provide proactive information disclosurein order to achieve the emission reduction targets
certified by SBTi.

CDP Climate Change 2022 score report

35

Turbo blower in the activatedsludge facility(Daiseki Kanto Works)● Endorsement of the GX League(Daiseki)
In March 2022, Daiseki declared our endorsementof the GX League Basic Concept, a framework
announced by the Ministry of Economy, Trade andIndustry, and in May 2023 we joined the league.
The GX League was founded as a place to discussand create a vision of a sustainable, carbon-neutral
future for 2050, a place to discuss market creation
and rulemaking in the carbon-neutral era, and aplace for companies to conduct voluntary emissions
trading to achieve their carbon-neutral targets. As
the premier company in Japan’s venous industry,
Daiseki hopes to use the GX League to share
information with other companies and government
body and make policy recommendations.

GX League logo

ESG Reporting
Environment

Initiatives to protect the environment and biodiversity
Initiatives to protect the atmosphere
and water environment●M itigation of business-related environmental impact

At Daiseki we are working to reduce environmental
impacts resulting from wastewater, exhaust, odors, andnoise generated in association with the treatment ofindustrial waste.
For all soot and smoke generating facilities ownedby the company, the level of air polluting materials
emitted is measured annually in accordance with the
Air Pollution Control Act, and levels are maintained ator below the standard level. In addition, dust collectors
and humidification equipment have been installed inplants to prevent the generation of dust during thetreatment of industrial waste.
The wastewater we receive is processed first by
neutralizing, coagulating, and dehydrating it; then abiological treatment is applied via the activated sludge
method before it is finally discharged into sewers or
rivers. We have also established our own standards foreach plant that go beyond the legal requirements forthe discharge of drainage water and formulated
emergency response procedures to be followed if a riskof exceeding our own required levels is identified.
As steps to counter unpleasant odors, we analyze
samples of industrial waste before it is delivered to us
and, in cases where it generates significant unpleasantodor, determine in advance whether to accept its
delivery and the treatment methods to be used. We
also install odor-eliminating devices in plants to remove
odors before release into the atmosphere.

Activated sludge processing facility for biological treatment of wastewater (Daiseki Nagoya Works)

Biodiversity initiatives

At Daiseki we believe that in order to protect
biodiversity, it is necessary to prevent thedestruction and pollution of the natural environment,
limit the excessive use of natural resources, prevent
global warming, and eliminate invasive species.
Based on this approach, Daiseki Hokuriku Works
participates in clean-up activities of nearby coastal
areas each year, and is working to protect theenvironment to preserve biodiversity.
For details on Daiseki’s initiatives to protect
biodiversity, refer to the section of our website on
biodiversity.

Coastal clean-up (Daiseki Hokuriku Works)

Detoxification of toxic substances

At Daiseki Group, we accept special control
industrial waste which includes toxic substances suchas strong acids, strong alkalis, and heavy metals, anddetoxify such toxic substances by appropriately
treating them with treatment agents. In FY2023, we
accepted 216,000 tons of special control industrial
waste, and following treatment we sent 11,000 tons ofspecial control industrial waste in the form of remnants,
etc., to an external treatment company. Special control
industrial waste is defined as highly hazardous under
the Waste Management and Public Cleansing Act, andeven small quantities of such waste have an adverse
impact on the natural environment. The Daiseki Group
contributes to preserving the natural environment by
properly treating such toxic substances.
Change in Amount of Special Control Industrial Waste Received and Emitted(10,000 tons) ■Amount received■Amount emitted (10,000 tons)

25

22.3
20

15

19.0

2.0

23.3

22.1

21.6

1.6

1.5
1.2

1.1

1.1

1.1

10

0.8

5

0.4

0

Deodorizing device by scrubber method with high deodorizing effects (Daiseki Kyushu Works)

1.2

0

2019

2020

2021

2022

2023

(FY)

36

ESG Reporting

S Social
PeopleTo continue growing 100 years from now, we strive to create a Company where all
employees can work long-term in a healthy and fulfilling environment, develop humanresources and promote diversity.

Health Management and Diversity
We clarify management challenges to resolve by Health Management and work on promoting diversity.

Promoting Health Management
InFY2022,Daisekiformulateditshealthmanagement
strategy,andclarifiedchallengestoresolveandhas
promotednecessaryinvestmentsandconcreteactions.
Thisyear,DaisekiandDaisekiMCRwereagaincertified
asa“2023HealthandProductivityManagement
Organization.”
Thiswasinrecognitionofoureffortsto
maintainandenhanceemployees’physicalandmental
healthandtocreateworkplacesthatareeasytowork
at.WewillaimforobtainingWhite500Certificationand
Bright500Certificationbycreatingworkenvironments
whereemployeescanshowhighperformances.

Health management initiatives
and results
ThemeasuresandsystemsDaisekiiscurrently
workingonareasfollows.

● Health consultations and employee
training by public health nurses
DaisekinewlyhiredapublichealthnurseinFY2024.
InFY2024,inadditiontoreceivinghealthconsultationsfromemployees,thepublichealthnurseisholding
health-relatedseminarsamongotheractivities.

● Care by external expert institutions(mental and physical healthconsultations, specific health guidance)Incooperationwithahealthinsuranceassociation,
wehaveestablishedahealthconsultationhotline
whichisavailable24hoursaday.Inadditionto
healthconsultations,thisconsultationhotlineis
availableforemployeestoreceivementalhealth
counseling,secondopinionservice,etc.Furthermore,
weareencouragingemployeestoreceivespecific
healthguidancewhencontactedbythehealth
insuranceassociation.Goingforward,wewillworkin
tandemwiththepublichealthnursetopromote
opportunitiesfortheguidanceforemployees.

37● Stress Checks
TheDaisekiGrouphasbeenconductingstress
checksforallemployees.Employeesexperiencinghighlevelsofstressarereassignedappropriatelybasedon
theirrequestsaswellasinterviewsandconsultationswithphysicians.
The Daiseki Group’s stress checks implementation
FY

（%）

2021

2022

2023

Stress check
implementation rate

91.2

90.0

89.6

Proportion of highly
stressed employees

6.9

8.7

10.1

● Regular Medical Checkups andComprehensive Health Examinations
TheDaisekiGroupcontinuestoprovideperiodical
medicalexamsforallemployeestomaintainand
improvehealth.Wealsofacilitatecomprehensive
healthexaminationsforemployeesaged35andovertoensuretheearlydetectionandtreatmentofillness.
The Daiseki Group’s attendance rate of regular medical checkups
and comprehensive health examinations (FY2023)（%）

Attendance rate

Regular medical
checkups

Comprehensive
health examinations

100

92.3

● Employee engagement surveys
FromFY2023,DaisekiandDaisekiEco.Solutionhavebegunsurveyingemployeeconcernsand
dissatisfactionabouttheworkplaceaspartofhealth
m a n a g e m e n t e f f o r t s t o i n c r e a s e e m p l o y e eengagement,andareworkingtomakeimprovements.
Thesesurveysarekeptconfidentialandindividual
employeesarenotidentified.Feedbackisprovidedto
theheadsofworkplaceswhereemployeeshadahighlevelofconcernordissatisfaction,andimprovements
arebeingpromoted.

ESG Reporting

Society: People

Main accomplishment related to society in FY2023 (the Daiseki Group)
Training hours per person

Turnover Rate

Paid Leave Acquisition Rate

7.3 hours/person

3.2％

67.3％

(7.0 hours/person)（1.9％）（70.2％）

Note: ( ) shows the number with Daiseki only

The Daiseki Group’s Promotionof Diversity

Promoting diversity and creating
comfortable working environments

Employees by Gender

Managers by Gender

Women
163

Women
3

In FY2023, 18 Daiseki Group employees utilized
childcare leave, of whom six were male employees.

Men
865

FY2023 end:
1,028

Men
195

FY2023 end:
198

Note: Full-time employees only

Note: Full-time employees only

New Graduate and Mid-Career Managers Hires by Gender (New Graduates)
Mid-Career
161

New Graduate
37

Women
12

Men
7

Acquisition of Paid Leave and Maternity/Childcare
Leave at the Daiseki Group
FY

2021

2022

2023

Paid leave acquisition rate (%)*1

58.8

60.5

67.3

Utilized maternity leave (people)

3

7

10

2

Men who utilized childcare leave (%)*

‐

10.8

21.4

Avg. number of days used formen’s childcare leave (days)

‐

‐

12.1

Women who utilized childcare leave (%)*2

‐

85.7

150.0

Avg. number of days used for
women’
s childcare leave (days)

‐

‐

255.3

The Daiseki Group’s turnover rate (FY2023)
Male employees Female employees

FY2023 end:
198

FY2023:19

Note: Full-time employees only

Directors by Gender
Women
1

Turnover Rate (%)*3

Note: Full-time employees only

Hires by Gender (Mid-Career)
Men
6

Women
9

as of
May 25,
2023
7

Men
49

Average Length of Service by Gender Average Annual Salary by Gender

Women

10.7 years
7.5 years

Note: As of FY2023 end; full-time employees only

Men
Women

6.2

Total
3.2

*1 Paid Leave Acquisition Rate shows the rate of paid leaves employees acquired within the leaves given*2 Childcare leave acquisition rate shows the rate of employees who utilized childcare leave versus thenumber of employees who had newborns in that fiscal year; the childcare leave acquisition rate may
exceed 100% if there were childcare leaves that spanned multiple fiscal years.
*3 Turnover Rate shows the rate of employees who resigned in FY2023 within the number of employees
in February 2023

● Comments from employees who took childcare leave Voice

We were able to share the joys andtribulations of childcare as a couple
Jiro Asada, Daiseki Kyushu Works Sales Division 1, Assistant Division Chief

FY2023:58

Note: Full-time employees only

Men

2.6

7.57 million yen
4.80 million yen

Note: 1. As of FY2023 end; full-time employees only
2. Male average age: 42.7 years old; female
average age: 37.6 years old

After the birth of our second child (our first son) in
November 2022, I took childcare leave in March 2023 toreduce the burden on my wife, who was taking care of ourson and daughter by herself. While I was on childcare leave, I
took care of cooking, laundry and other things, and was able
to reduce the burden shouldered by my wife. It was also atime for me to mentally refresh by being with my kids more,and I gained a renewed motivation for my work. By taking
childcare leave, I was once again
able to experience the joys anddifficulties of raising kids and gained
useful life experiences. From 2022
it is possible to take split childcare
leave, so I am planning to takeanother leave period later on.
Childcare

38

ESG Reporting
Society: People

Human Resource Development and Workplace Improvement Efforts
We aim for company’s continuous evolution by enhancing human resources development and creating
environment where employees can work comfortably.

Human resources development policy

Internal environment improvement policy

The involvement of various personnel is necessary
for the realization of the company’s management
strategy. We have positioned the development of
next-generation management personnel as our corefocus, and we will raise internal motivation byenhancing training per job level from new
employees to managers, as well as by enriching
training programs tailored to the career aspirationsof employees.
Also, by utilizing job rotations for the purpose ofhuman resources development, we will broaden
employees outlooks, increase their curiosity in theirwork, and improve in-house communication. Daiseki
will cultivate personnel who can respond flexibly tochanges in society and diverse values.

In order for employees to be proud about their work
to their families, we believe it is important that they are
fulfilled in both their work and personal lives. We
believe that in order for each employee to feel fulfilledin their work and have high motivation for growth, it isimportant to accumulate successful work experiences,
to demonstrate teamwork by fostering a culture ofmutual recognition and praise, to enrich personal lives
by achieving results efficiently in limited time, and toensure the safety and health of employees and theirfamilies, around which the above factors revolve.
Daiseki will build a corporate culture that allows us
to consider everything from our immediate work
environment to the global environment, and tocontinue to grow and take on challenges, and provide
a work environment in which employees can workwith vigor and be proud of to their families.

Target and performance for human resource
To promote Health Management and diversity, theDaiseki Group set concrete target figures in FY2023.
In March 2023, four female employees were newly
appointed to management positions, such that of a
total of 201 managers, there are now seven female
managers, a rate of 3.3%.
Actual and target figures related to human resources for FY2023
ActualTargetTurnover Rate

3.1% (1.9%)

Below 2% (below 1%)

Paid Leave Acquisition Rate

67.3% (70.2%)

80% or more (80% or more)

Rate of Female Managers

1.5% (1.6%)

By FY2027 10% or more
(10% or more)

Note: ( ) shows figures for Daiseki only

Female manager training
In order to achieve the target of increasing theratio of female managers to at least 10% by the endof FY2027, from FY2023 Daiseki began efforts totrain future female management candidates.
Between October 2022 and January 2023, threefemale employees in the assistant division chief orchief class attended the four-day female manager
training course. In this course, participants learned
about the state of female managers, leadership,
logical thinking, management of direct employees,
and the formulation of action plans, among othertopics. We will continue bolstering efforts for thedevelopment of female managers.

Efforts for nurturing human resources● Employee trainings
The Daiseki Group actively participates in trainings
programs considering that employees are our humancapitals. From FY2023, we are inviting outside
instructors to hold new training course for female
managers. We will also continue holding compliancestudy sessions for all employees.
Total training hours at the Daiseki Group (FY2023)
Description

Total training hours (hours) Total number of attendees (people)

Compliance study session 5,726(5.1 hours per employee)
Training per job levels
Female manager training course
Other trainings
Total

39

400

11,452
32

68

3

1,958

−

8,152(7.3 hours per employee)

11,487

Female manager training course

ESG Reporting

Society: People

Creating comfortable working environments●W ork Environment Improvement Project
Daiseki has been engaged in the“Work Environment
Improvement Project.”This involves in-house improvement
activities aimed at creating a workplace where all
employees can work in health and safety. The employees
in charge of the project and each department are working
together on improvements while listening to employees’
opinions and requests for improvements to the workplaceenvironment.

Implementing RPA to improve work
efficiency (Daiseki Eco. Solution)
Daiseki Eco. Solution implemented company-wide
RPA in FY2023 with the aim of improving work
efficiency. RPA stands for Robotic Process
Automation, which is a technology that uses robots
to automate tasks done on PCs. By utilizing RPA,
benefits such as work streamlining and reduced costs
can be expected. The largest benefit of this for
D aiseki Ec o. Solution came fr om checking thecheckbox after confirming that analysis results werea c c ur a t e . W i t h t hi s t e c hn o l o g y w e h a v e b e e n
successful in reducing the time spent on analysis
work by 40 hours per month. We are planning
additional work streamlining going forward.

Flow of Work Environment Improvement Project Activities

Shareholding association system

Overview of RPA (Daiseki Eco. Solution)

Daiseki regards employees as human capital, andto encourage employees to have an interest in thecompany’s management and to expand employee
benefits, we grant a stock holding incentive of 15% of
the reserve amount to support employee ownershipof company shares.
Attendance at shareholding association at Daiseki
FY

2021

2022

2023

● Comments from an employee engaged in work streamlining Voice

Number of shareholding
association members (people)

492

545

570

Attendance rate forshareholding association (%)

77.1

81.4

82.7

Using digital tachographs to streamline
vehicle dispatch and reduce overtime work

● Improving the work environment with renovations
At Daiseki Kanto Works we expanded the officespace and changed the layout to create a new dining
space. This made the space more open, contributed
to a better working environment, as well as work
efficiency and enhanced motivation. It also made thedining space easier to use as kitchen and basin areas
are consolidated onto one floor. This has increased
the number of opportunities to have meals withe mp l o y e e s f r o mother departments,
deepening bonds
and making it easier
to collaborate on
work.
Cafeteria after renovation(Daiseki Kanto Works)

Yusuke Ishikawa, Daiseki Chiba Works Operations
Division, Assistant Division Chief
We installed digital tachographs on all industrial wastetransport vehicles at Chiba Works. Before these were
installed, employees would write a work report every day
after returning to the company, but by using digitaltachographs this was no longer necessary, contributing to a
reduction in overtime hours worked. Employees in our section
said they were happy that they no longer needed to write areport after returning to the office, and that they were now
able to leave work earlier. Furthermore, this initiative enabled
us to monitor the location of eachtransport vehicle, making the return
time to the company more predictableand enabling us to arrange efficientdispatching of vehicles. Production
section employees can also quickly
ascertain the delivery time of items to
be received, proving a synergistic effectfor other departments. We willcontinue endeavors to streamline
operations to facilitate the work ofsection employees.

40

ESG Reporting
SocialSafetyTo ensure employee safety, we are revising our safety management system andpromoting safety and health activities.

Work-related Safety and Health Initiatives
Daiseki strives to create a safe working environment through efforts to prevent work-related accidents andensure the physical and mental health of all employees.

Establishment of Safety and
Health Management System

Safety Promotion Manager Appointment

E a c h D a i s e k i G r o u p c o m p a n y a p p o i n t s i t sPresidentasthechiefrepresentative,andselects
representativesforSafetyandHealthateachsitetobuildtheSafetyandHealthManagementSystem.
Also,weshareinformationofaccidentsatthe
DaisekiGrouptopreventsimilaraccidents.

“SafetyPromotionOffice”
havebeenestablishedateachDaisekibusinesssitemanagedby“SafetyPromotionManager”
appointedtopromotesafety.
Thepresidentdelegatestheauthoritytopromote
safetytoapersoninchargeateachworksitewho
providesguidancetostaffandimplementsvarious
safetymeasures.

Daiseki’s Safety and Health Management System

Initiatives aimed at danger-free workplaces

President and Representative Director
Headquarters of Business
Generalization

Works Manager

Safety Management
Department
Cooperation

Safety Promotion Manager*1
Safety Promotion Oﬃce

Safety Manager*2 Health Supervisor*2

Safety and HealthCommittee Member*1D elegatedtoauthoritiesrelatedtosafetymanagementby
PresidentandRepresentativeDirector*2AttheChibaWorks,whichhaslessthan50employees,itisnot
necessarytoappointaSafetyandHealthManager,thusaSafety
andHealthPromoterhasbeenappointedTopreventaccidents,DaisekiGroupsitesthat
handlehazardousmaterialsimplementthefollowing
initiatives.
❶ Close-call incident reporting and risk assessments
Weoperateaclose-callreportingsystemwhichreceives
reportsfromemployeesonthingstheyfeelcouldposea
danger,andcontributestoimprovements.Furthermore,
managersregularl yconductriskassessmentsto
quantitativelyevaluatethefrequencyandseverityofworkrelatedhazardsandtakeriskmitigationmeasures.
❷ Sharing accident information
InformationonaccidentswhichoccurredataGroup
companyissharedinternallyatthatcompanyandusedfor
guidancetopreventthesametypeofaccidentfromoccurringinthefuture.Informationonaccidentsofparticular
concernisalsosharedwithotherGroupcompanies.
❸ Safety Patrol
Safetypatrolsareperiodicallyconductedateach
workplaceandhazardouswork/locationsareidentifiedfor
improvement.

Safety and
Health Policy
T h e D a i s e k i G r o u pe s t a b l i s h e s S a f e t y a n dH e a l t h P o l i c y a t e a c hcompanyandpromotes
preventionofaccidents,
andSafetyandHealth.We
p u t s a f e t y a s t h e t o pp r i o r i t y a n d w o r k o n
cr e a tingthew orkpl ac e
w h e r e e m p l o y e e s c a n
worksafelyandhealthy.

41

SafetyandHealthPolicy(Daiseki)Asnapshotofcraneoperation(SystemKikou)

ESG Reporting

Society: Safety

Safety Trainings

Daiseki Group Work-related Accident Record

To prevent accidents, the Daiseki Group gives daily
instructions and alerts at monthly safety meetings forthe sites that handle hazardous materials. In addition,
safety training is conducted for all employees. For
example, Danger Prediction Training is conducted toenhance workers’ability to recognize possible hazards
at worksites. We also conduct side-by-side instructional
rides for vehicle crews to check and evaluate the stateof vehicle driving and operations.
Employees who attended safety training said that thetraining helped them understand the awfulness ofaccidents and points to focus on to prevent accidents.

In 2022, the Daiseki Group had 4 accidents
accompanied by lost worktime and 13 accidents notaccompanied by lost worktime. Accidents associatedwith lost worktime included lacerations and falls, andaccidents not associated with lost worktime included
touching wastewater and lacerations.
Daiseki Group Work-related Accidents
Year(cases)January– January– January– January– January–
December December December December December
2018
2019
2020
2021
2022

Fatalities

0

0

0

0

0

Accidents accompanied
by lost worktime

7

7

7

6

4

Accidents not accompanied
by lost worktime

10

5

2

7

13

Daiseki Group occupational accidents (frequency rate)*
Year

Side-by-side instructional ride with vehicle crew (Daiseki Kyushu Works)

January–
December
2020

January–
December
2021

January–
December
2022

Manufacturing industry

1.21

1.31

1.25

Industrial waste treatment industry

6.95

7.36

6.52

Daiseki Group

2.68

2.21

1.42

* Frequency rate: Total number of casualties due to occupational accidents per
million total working hours (accident frequency)

Daiseki Group Occupational accident rate (intensity)*

Safety trainings for partner companies
Daiseki focuses not only on safety training for Daiseki
employees, but also on safety training to prevent
accidents at partner companies. Since about half of thecrews that go to customer plants to collect waste arecrews from partner companies, we recognize that
accident prevention for partner companies is a key
topic. At Daiseki’s Kansai Works, partner company
crews are instructed on examples of accidents that
occurred at other companies and countermeasures, aswell as how to handle equipment, response measuresin emergencies, and other topics.

Year

January–
December
2020

January–
December
2021

January–
December
2022

Manufacturing industry

0.07

0.06

0.08

Industrial waste treatment industry

0.48

0.17

0.51

Daiseki Group

0.05

0.04

0.06

* Intensity: Total number of working days lost per 1,000 total actual working
hours (degree of accident severity)

Giving a Talk on Our Actions for Safety
In July 2023, Daiseki was invited to the Safety
Conference  organized by the Hiroshima Prefecture
Resource Circulation Association . We gave a talk to theConference about our safety initiatives for theprevention of accidents in the industrial waste treatment
industry, and also gave an overview of our Hiroshima
Works, Daiseki’s 7th works.

Safety training for partner company crews (Daiseki Kansai Works)

A snapshot of our talk (Daiseki Vice President Ito)42

ESG Reporting
SocialLocal Communities

The understanding of neighboring communities is essential for the operation of anindustrial waste treatment business.
While striving to engage in proactive dialogues and exchanges, we are also engaged insocial contributions leading to the invigoration of local communities.

Signing a circular economy
agreement with Gamagori CityInDecember2022,Daisekisignedapartnership
agreementwithGamagoriCitytopromoteurban
developmentinthecitythroughapublic-private
partnership.GamagoriCityhasexpresseditsgoalof
i n c o r p o r a t i n gt h ec i r c u l a re c o n o m yi ni t su r b a ndevelopmentandbecominga“circularcity”
whichproactivelypromotesthecirculareconomy.Thepurpose
ofthisagreementisforGamagoriCityandDaisekito
utilizetheirrespectiveresourcesandnetworkstopromotearecycling-orientedsocietyandthecirculareconomyinordertoachieveacircularcity,aswellastoresolve
problemsinthecommunityandrevitalizethearea.

Awarded Medal with Dark Blue Ribbon
DaisekimadedonationsinsupportofAkashicity’s
environment-relatedprojectsfortwoconsecutive
years,in2021and2022.Inrecognitionofthis,we
wererecentlyawardedtheMedalwithDarkBlue
Ribbon,anawardforexceptionalphilanthropy.

ReceivingtheMedal(DaisekiKansaiWorks)

Participating in training to set up and operate temporarystorage facilities for disaster waste (Daiseki Eco. Solution)

AgreementsigningceremonyonbusinesspartnershipwithGamagoriCity(Daiseki)

Participation in the removal of illegally dumped wasteAttherequestofthelocalgovernment,DaisekiKansai
Worksparticipatedintheremovalofillegallydumpedwaste
throughthe“WasteEcoBillProgram.”Underthisprogram,wastethathasbeenillegallydumpedorimproperly
disposedofonunmanagedprivatelandintheHigashiHarimaareaandisdetrimentaltothelivesofthoseinthecommunityisremovedanddisposedofincooperationwith
wastetreatmentcompanies,localresidents,andthelocal
g o v e r n m e n t , a n d m e a s u r e s a r e t a k e n t o p r e v e n treoccurrence.Onthedayoftheclean-up,weremoved
illegallydumpedwastealongsideaprefecturalroad.

Receivinganappreciationletterfromtheprefecturalresidents’bureauofHigashi-Harima,HyogoPref.(DaisekiKansaiWorks)

43

DaisekiEco.SolutionparticipatedinNagoyacity’strainingto
setuptemporarystoragefacilitiesforresidentsinJuly2022,and
intwosetsoftrainingtosetupandoperatetemporarystorage
facilitiesfordisasterwaste,thefirstrunbyKitanagoyacityin
September2022andthesecondbyToyoakecityinNovember
ofthesameyear.Thesetrainingprogramsarehostedbythe
localgovernmentandAisankyo(AichiPrefectureindustrial
resourcerecyclingassociation)toconfirmandverifythestatus
oftemporarystoragefacilitiesandthereadinesstoreceivedisasterwaste.Wewereabletoimprovepreparationsand
proficiencyinrespondingtodisasters.Goingforward,DaisekiGroupwillnotonlycontinuetreatmentofdisasterwaste,but
alsoparticipateinpreparationsandtraininginnormaltimesin
cooperationwithlocalgovernmentsandregionalcommunities.

TrainingtosetupandoperatetemporarystoragefacilitiesfordisasterwasteinKitanagoyaCity(DaisekiEco.Solution)

ESG Reporting

Society: Local Communities

Disseminating Information and Interacting with Local Communities and Stakeholders
Daiseki makes an eﬀort to engage in dialogues with residents living near our facilities, and strive to disseminate information
through events that attract attention related to the environment and briefing sessions for investors and other stakeholders.

Exhibition at the COP27 Virtual
Japan Pavilion

Cooperation with The Universityof Tokyo OEGs

DaisekijoinedCOP27VirtualJapanPavilion
o r g a n i z e d b y M i n i s t r y o f t h e E n v i r o n m e n t i n
November2022.
Weexplainedthatourrecyclingandindustrial
w a s t e t r e a t m e n t b u s i n e s s c o n t r i b u t e s t o t h erealizationofthecirculareconomy,thatourrecycled
fuelisutilizedasasubstituteforcoalandheavycrude
oil,whichcanreducetheuseoffossilfuels,andthat
Daiseki’swasterecyclingreducesgreenhousegas
emissionsby98%comparedtosimpleincineration.

InFY2023,DaisekibegansupportforTheUniversityofTokyoOneEarthGuardians(OEGs),whichisa100-year
projectlaunchedbyTheUniversityofTokyoGraduateSchool
ofAgriculturalandLifeSciencestoprotecttheearth.In
FY2023,wediscussedwhatkindofbusinesswewould
considerbasedonthetopicofpreservingtheglobal
environmentthroughthecirculareconomy.Daiseki
employeescommunicatedthecurrentstatusofthecircular
economyandbusinessissues;studentsfromTheUniversityofTokyothenconductedresearchandstudiesfromascientific
perspectiveandpresentedtheirfindingstoDaisekiexecutives
inJanuary2023.WeplantocontinuethisactivityinFY2024.

PresentationslideforCOP27VirtualJapanPavilion

ESG Briefings for Institutional Investors
InOctober2022,atourQ2financialresultsbriefing,
weheldanESGbriefingsessionforinstitutional
investorstoexplainourESGactivities.Atthisbriefingw ec o v e r e dD a i s e k i’sr e c y c l i n gb u s i n e s s ,o u rreductionofgreenhousegasemissions,andthe
promotionofdiversity,amongothertopics.

ESGbriefingslides

ProposalpresentationsbystudentsfromOEGs(atDaisekiHeadquarters)● Comments from an employee who participated as a disaster relief effort Voice

Participating in disaster relief efforts in Suzu city
to support the recovery of the affected area
DaisekiHokurikuWorksSafetyPromotionOffice,AssistantDivisionChiefYukihikoNakagawa
InMay2023,anearthquakeofintensity6Upperontheseismic
scalestrucktheNotoregionofIshikawaPrefecture,causingdamages
whichresultedinalargeamountofvariousearthquake-related
wastes.UndertheinstructionoftheIshikawaPrefectureIndustrial
ResourceRecyclingAssociation,suchwastewasarrangedtobe
sortedanddisposedofbydisposalcompanies,butthereweredifficultiesinsortingresultingintheprocessbeingstalled.Itwasat
thistimethatwereceivedasupportrequestfromtheIshikawaPrefectureIndustrialResourceRecyclingAssociation,andmyselfand
oneotheremployeetoparticipateinthesortingofearthquake-relatedwasteinSuzu
cityfromMaytoJune.Thisprimarily
entailedunloadingearthquake-related
wastebroughtinbytruckbylocalresidentsandsortingitbytypeintothedesignated
areas.Manyofthelocalsaffectedbythedisasterwereelderly,andtheyexpressed
theirappreciationtousasweworked.As
anindustrialwastetreatmentcompany,Ihopewecanproactivelyparticipateinsuch
disasterrecoveryeffortsinthefuture.

44

ESG Reporting

G GovernanceCompliance

For Daiseki Group, which expands businesses with permissions, assuring complianceand meeting social responsibility and public responsibility are the most important issues
for corporate management.

Basic Approach to Corporate Governance
Daiseki positions corporate activities that comply withlaws and social norms as the most important issue for
improving transparency and soundness in corporate
management. We adopted the Company with Audit andSupervisory Committee system, with an Audit andSupervisory Committee comprising three outside
directors, further enhancing the supervisory function of
directors. One of external directors is a woman, who
gives recommendations from a female perspective.
In May 2020, Daiseki introduced an executive officer
system with the aim of clarifying business execution
responsibilities, streamlining management andaccelerating decision-making. Further, the authority
necessary for conducting daily corporate activities isdelegated to the works managers at each of the six
worksites and the presidents of six Group companies,
with the Management Meeting held with the participationof directors, executive officers, works managers, directorsof consolidated subsidiaries and other staff.
Also, in May 2023 we appointed an additional external
director who has experience with corporate management
in order to strengthen the company’s governance, whichmeans we now have a majority of external directors.

Daiseki's Corporate Governance System
General Meeting of Shareholders
Appointment and dismissal
Audit, etc.

Board of Directors
Proposal and report

Audit and Supervisory Committee
Appointment and Compensation Committee

Selection, dismissal and supervisory

Direction
ReportReport(Directors, Executive Oﬃcers, Works Managers,
Directors of consolidated subsidiaries, etc.)

Cooperation

Accounting audit

Accounting Auditor

Audit Oﬃce

Internal Control System Promotion Committee
Direction
Compliance Committee

Management Meeting

ReportConsultation
ReportRepresentative Director

ReportAppointment and dismissal

Appointment and dismissal

Internal Audit

Sustainability Division Meeting
Risk Management Committee

Direction

Each department, Works, Consolidated subsidiary

Board of Directors
The Board of Directors is comprised of seven members:
three internal directors, one external director, and threeexternal directors who also serve as Audit andSupervisory Committee members. Of these members, one
is a female director, contributing to a more diverse Board
composition. In addition to regular Board of Directors
meetings which are held once per month in principle,
extraordinary Board of Directors meetings are held asnecessary. The Daiseki Group holds Board of Directors
meetings more frequently with the aim of facilitating
prompt and accurate decision-making and efficientorganizational management of the Group as a whole.

45

Board of Directors
Internal directors…Men…WomenExternal director

External Directors(Audit and Supervisory
Committee members)

ESG Reporting
Governance

Main accomplishments related to governance of FY2023 (Daiseki)

Board of Directors

Held

Audit and Supervisory
Committee

Ratio of external directors
within all directors

21 times Held 14 times(as of May 25, 2023)

57.1％

Basic Approach to Internal Controls

Compliance System

Based on the Companies Act and the Ordinance for
Enforcement of the Companies Act, Daiseki establishedthe following system for ensuring the appropriateness ofoperations (hereinafter, the“internal control system”).

Daiseki established a Compliance Committee in
May 2002 and formulated an Ethics Charter
announced within and outside the Company.
Compliance Committee chaired by the President andRepresentative Director works on grasping the statusof company-wide compliance systems establishedand its problems, analyzing compliance risks at eachdepartment and embodying countermeasures. For
the cases where the Daiseki Group management orcompliance officers at each department findproblems related to compliance, we have establisheda system to report to compliance committee
immediately and thoroughly operate that system.

❶ W ithin the Daiseki Ethics Charter, Daiseki establishedthree guidelines for corporate behavior that convey its
stance on growing and developing alongside society:Social roles and responsibilities, compliance with laws
and regulations, respect for human rights and thefostering of a free and open corporate culture.
To achieve perpetual development as an industry leader,
Daiseki has developed an internal control system andstrives to embody its Ethics Charter.
❷ T he Board of Directors formulates basic policies forinternal control, provides instructions and supervision on
the implementation status of internal controls, confirms
maintenance and operational status and reviews basic
policies and countermeasures when necessary.
❸ D a i s e k i e s t a b l i s h e d t h e I n t e r n a l C o n t r o l S y s t e m
Promotion Committee chaired by the President andRepresentative Director to ensure reliable financial
reporting through the establishment and maintenance ofinternal control system programs.

Risk Management
Daiseki established Risk Management Regulations in2006 to address various risks including earthquakes andother natural disasters, occupational accidents andinformation leaks. Additionally, we created a risk map andestablished a response system defining responsible
departments for each risk classification.
The Risk Management Committee, which plays a central
role in risk management, is chaired by the President andRepresentative Director and manages risks facing theDaiseki Group thoroughly and comprehensively. The Audit
Office audits the risk management status of eachdepartment, reports the results to the Risk Management
Committee and the Board of Directors on a regular basis,and deliberates and decides on improvement measures.
Our Sustainability Division Meeting and Risk
Management Committee have also deliberated on climatechange risk analysis based on TCFD recommendations
since FY2022, with progress confirmed at management
meetings and results reported to the Board of Directors.

Compliance System
Compliance Committee

Objective
To plan various measures fostering compliance awareness throughout theorganization and conﬁrm the status of awareness among employees.
Composition
Chairman: President and Representative Director
Deputy chairperson: General Manager, Headquarters of Business Generalization;
General Manager, Headquarters of Planning and Management
Member: Director in charge of Headquarters of Business Generalization;
Department Managers of Headquarters & Assistant Department
Managers; Audit Oﬃce

Secretariat
Secretary General: General Manager, Headquarters of Planning and Management
Clerical work: Human Resources Department (in charge of promotion of compliance)

Compliance Oﬃcer:
Department Managers and Heads of Works (ultimate authority in departments and works)

Person to be in charge of compliance: Employees at job levels ofVice Works Manager, Deputy Department Manager or higher

Employees

46

ESG Reporting
Governance

A Conversation with Our External Directors

Directionality to achieve Vision 2030,
our long-term management vision
Three of our external directors had a conversation on the current status and future prospects of
Vision 2030, Daiseki’s long-term management vision formulated in 2018, and the efforts necessary
to bring it to fruition.

New, future-oriented businesses take off,
raising expectations for further growth― How do you evaluate Daiseki’s business strategy,
performance, and social outcomes for FY2023?
Sahashi: Regarding new business strategy, I believesigning the cooperative agreement with a municipality(Gamagori, Aichi Pref.) to work toward the realizationof a circular city was a major step toward the future.
The question of how to promote environmental policy
for decarbonization is an issue for many local
governments. I believe that Daiseki, as a leader inresource regeneration in regions in Japan, can play arole by connecting local government bureaus acrossthe board on the topic of the environment, thus
breathing new life into the situation.
Kako: The knowledge and know-how obtained throughsuch initiatives can be expanded horizontally to otherlocal governments. This joint agreement was coveredby various media outlets, and in this way I believe
Daiseki’s visibility will increase across Japan.
Mizuno: For performance, we regarded the large-scalewater leak at Meiji Irrigation Works, an industrial

47

waterworks in the Tokai region, the global shortage ofsemiconductors, and the delayed impact of the
COVID-19 pandemic as points of concern. When thefactory utilization rate falls, demand for liquid waste
recycling also declines. However, the water leak at Meiji
Irrigation Works was remedied in about three months,
and since the COVID-19 pandemic is coming to an end,
I believe we can expect further growth in FY2024.
Kako: Susceptibility to external impact may be an issue
going forward. From the perspective of personnel
utilization, there have been new movements in theengagement of female employees. I have advised regularpersonnel transfers for female employees for quite sometime, and I have heard that the female employees who
have been assigned to work with Gamagori City areplaying an active role in the project. Furthermore, it has
been encouraging to hear directly from other employees
about their enthusiasm for their work.
Sahashi: There has been an increase of three female
employees promoted to management, and this has
invigorated the company, hasn’t it?
Kako: Yes, I think employees also feel that somethingis building. The company should take this opportunity
to be proactive in training and other initiatives for skill

ESG Reporting
Governance

Profiles of External Directors (Audit and Supervisory Committee members)

Norikazu Sahashi

Nobukatsu Mizuno

Mitsuyo KakoFirst election in 1987, heserved on Nagoya City Council
for six consecutive terms.
Chairman of the Nagoya City
Council from 2005 to 2006.
Took on his current role in2016 after being appointed asa Daiseki Auditor in 2012.

Worked with Tohmatsu & Co.
(now Deloitte Touche
Tohmatsu LLC) before
assuming directorship of the
Nobukatsu Mizuno Certified
Public Accountancy Office(ongoing position). Took on his
current role at Daiseki in 2018.

After serving on the staff of Aichi
Prefecture, she was appointed
trustee and board member ofAichi University in 2016 (ongoingrole). Appointed board memberof Chita City Board of Education in2018 (ongoing role). Took on his
current role at Daiseki in 2020.

development of all employees including women. I thinkit’s essential to expand training for managers in order
to raise the level of the organization as a whole.

Achieving Vision 2030: Using numbers andtarget items to visualize and execute a plan
― Please tell us about the status of Vision 2030
initiatives as well as the future outlook and expectations.
Sahashi: We are expecting Vision 2030 to promote thecircular economy. Daiseki will not only recycle waste
produced by companies, but also help circulate moreresources throughout society. Vision 2030 willcontribute to achieving the SDGs and also has thepotential to create a consulting business. We anticipate
that Daiseki, recycling companies, will develop into
circular economy companies.
In light of increasing needs, I believe Daiseki now
needs to sow the various seeds for collaboration withlocal governments and the circular economy, etc. Daiseki
has established“Ideas, Plans, Structures, Actions”asits management principles. Based on new ideas, Daiseki
develops plans and organizes structures to realize theidea and cultivate it into a business. I hope Daiseki will
work hard to explore new business opportunities.
Regarding the collaboration with the city ofGamagori, Daiseki should test the process ofconnecting with other local governments across Japanand create an internal system. In addition toestablishing this as a pillar of new business for Daiseki,I expect this will become a standard for working withlocal governments.
Mizuno: In order to do this, it is important that the board
members further understand Vision 2030. Vision 2030
cannot be achieved by simply continuing on the present
course. Working with local governments might also be
within the scope of established practice. Daiseki needs
to develop new businesses that differ from its existing
businesses. The company must clearly envision the ideal
image of Daiseki for the year 2030, and deliberate,
discuss, and refine the actions it should take now.
FY2024 is the year in which Daiseki should visualize
specific figures and items and put a plan into action.
In Japan there are close to 4,000 listed companies,
but only 480 companies*1 have released a mediumterm business plan, and Daiseki is one of thesecompanies. This shows how Daiseki is a listed company
that places importance on engaging in dialogue withshareholders, but I would like to see the company goeven further and incorporate detailed progress

management for its goals. The number of companies
actually doing this in Japan is likely less than 100.
Kako: Employees may not realize how much attention
Daiseki is attracting both in Japan and internationally.
The company should put even more of a focus on
improving the work environment as a part of humanresource development. Daiseki should continue its
efforts to increase the annual leave utilization rate ofmanagers and engagement of female employees. On
the other hand, the extremely low turnover rate of 3.2%
on a consolidated basis and 1.9% on a Daiseki nonconsolidated basis in FY2023 is highly commendable.
Mizuno: I believe Daiseki is the only company in theenvironmental industry with a turnover rate in the
single digits. It has also earned high scores for laborrelated items in international ESG-related assessments.

Balancing existing and new businesses
through“ambidextrous leadership”― What do you consider the effectiveness of theBoard of Directors?
Mizuno: These changing times call for“ambidextrous
leadership.”*2 In this era, companies who achieve
management combining the deepening of existing
businesses (deepening of knowledge) and the search
for new businesses (searching for knowledge) willgrow and survive. The Board of Directors’role is not
only conducting the company’s present core business,but also strongly supporting the challenge of sowing
the seeds of future businesses. We expect them totake responsibility and action for this.
Sahashi: To that end, we have decided to appoint
someone with management experience as an external
director from FY2024. We hope to not only reinvigorate
the Board of Directors, but also to strengthen thefunctions of continual management supervision andcounsel.
Kako: The Board of Directors is structured such thatexternal directors receive regular business reports fromthe person in charge of each department. As external
directors, we, too, will closely monitor the Board of
Directors and the company itself, and promotecompany-wide efforts to realize Vision 2030.
*1 D aiwa Institute of Research“Recent Trends of Medium-termManagement Plans Sep. 2022”Total for Jan.-Aug. 2022
*2 A management theory proposed by professors Charles A. O'Reilly
and Michael L. Tushman. This management methodology
simultaneously pursues two contrasting aspects: the deepeningof existing businesses and the exploration of new businesses.

48

ESG Reporting
Governance

Whistleblower Protections
The Daiseki Group established a complianceconsultation counter where employees can directly
consult with The Daiseki Human Resources
Department or corporate lawyers that is easy for
employees to use, and thoroughly operate it informing
the importance of it. When employees consult, theconsultation counter will investigate the matter,
determine the countermeasure to prevent it fromhappening again with the related departments and
imp l e m e n t i t t h o r o u g hl y , c o mp a n y - w i d e . T h ewhistleblowing system stipulates the protection ofwhistleblowers so that employees who make reportsuffer no adversity. All information from whistleblowers
handled in the strictest confidence only by those who
respond in the whistleblower system so no informationis leaked to the outside.

Information Protection and Management

Preventing corruption

In 2005, we formulated Personal Information
Protection Rules to ensure all officers and employees
maintain a thorough understanding of appropriate
personal information protections in an effort tostrengthen management.
Based on the Information Security Basic Policy, we
strictly manage and control the creation, use, removal
and storage of information. In FY2023, there were no
incidents involving the leak of personal information.

The Daiseki Group has established and abides by
the following items in its Code of Conduct to prevent
corruption.

Respect for Intellectual Property Rights
We formulated employee invention regulations toaddress inventions and other intellectual property
created by employees while on the job. By clarifying
the attribution of rights to employee inventions andguaranteeing inventor rights, we are working toincrease motivation for research and development.
Number of intellectual property rights(FY2023 end) (cases)
Number of intellectual
property rights

Patents holding

Patents pending

44

Compliance with the Excellent Industrial
Waste Disposal Company Certification System

The purpose of this system is to create an environment
in which generators of industrial waste can easily
outsource treatment to excellent certified businesses andto promote the proper treatment of industrial waste. If an
industrial waste disposal company with a track record of
five years or more meets certain standards, a seal of
excellence will be printed on the permit and introducedon the Industrial Waste Information Net website.
Daiseki was the first operator to be certified under thissystem by the city of Nagoya in 2011, and as of February
28, 2023, we were certified as excellent by a total of 49
local governments (45 prefectures and four cities).

49

The Certification of the
Excellent Industrial
Waste Disposal
Company by Nagoya City

(1) Developing sound corporate activities● We engage with all business partners in good faith, justly
and fairly.
● We establish mutually beneficial relationships withbusiness partners and aim for stable growth anddevelopment.
● We conduct corporate activities in accordance withsocial norms and standard business practices.
● We build an internal control system for the purpose of
ensuring the reliability of financial reports.
● We aim to enhance shareholder returns as profits grow.

(2) Compliance with the antimonopoly act● We do not discuss or enter into agreements thatmutually restrict free corporate activities.
● We do not use one’s position to influence business
transactions.
● We do not make inappropriate displays or provide
excessive gifts or prizes.

(3) Appropriate approach to entertainment,
gifts, and similar practices● We don’t entertain or give gifts to business partners andother stakeholders beyond the scope of social
conventions and common courtesies.
● We don’t entertain or give gifts to current or former civil
servant employees, except when permitted by laws andregulations.
● We don’t provide our shareholders with entertainment
or gifts that exceed the scope of social conventions andcommon courtesies.
● We don’t give any favors to antisocial forces (extortionists).

(4) Transactions with public institutions, handlingof political contributions and donations● We act with thorough consideration for sociality,commonality, necessity, etc.
● We do not make illegal political contributions.

ESG Reporting
GovernanceProtecting human rights

Effectiveness evaluation of Board of Directors

We respect the basic human rights of its
employees and strive to prevent discrimination andhuman rights violations on the basis of race, creeds,
gender, physical disabilities or other anomalies. To
this end, power harassment workshops for all
managers are conducted regularly by an outside
lecturer. Additionally, we are conducting training
aimed at preventing sexual and power harassment
for new managers. Further, the Human Resources
Department regularly interviews employees tomonitor for human rights violations.

Effectiveness evaluation of Board of Directors held
in FY2023 was conducted, and its results werereported and discussed at Board of Directors. The
evaluation results are as follows.

❶ Task implemented●Evaluation subject…Board of Directors held in September 2021
through September 2022
●Person in charge of evaluation…All Directors●Overview…Items to be evaluated◦Composition and operation of the Board of Directors◦Management strategy and business strategy◦Discussions at the Board of Directors◦Operation of the Board of Directors◦Dialogue with external directors◦Effectiveness of governance system and the Board of Directors❶W e respect the basic human rights of its employees ands t ri v e t o pr e v en t dis crimina t ion and human ri g h t sviolations on the basis of race, creeds, gender, physicaldisabilities or other anomalies.
❷ We protect personal privacy.
❸W e don’t engage in sexual harassment or other acts that
violate human rights.
❹W e create a corporate culture in which employees havemutual respect for one another.

❷ Analysis and evaluation results

State of human rights protection●Questionnaire results…Generally positive●Effectiveness of Board of Directors…Confirm that it is generally secured

The Daiseki Group does not engage in discrimination,
forced labor, child labor, human trafficking, or any otheracts that are detrimental to human rights. Furthermore,
we do not engage in business with companies ororganizations that may be involved in such acts that are
detrimental to human rights.

❸ Measures to realize effectiveness●Three items pointed out as improvement was
required were as follow.
◦Considering strengthening the governance system
as a company listed on the Prime Market byincreasing the ratio of external directors to over half◦Considering an initiative to hold broader discussions
than before by including external directors withcorporate management experience in the Board of
Directors◦Considering increasing the time spent discussing
Group governanceDirectors skill matrix (as of May 25, 2023)
Name

Title

Age

of
Gender Term
officeCommittee

Tetsuya Yamamoto

Representative
Director

58

Men

28

Yasuo Ito

Representative
Director

50

Men

13

Koji Amano

Directors

62

Men

20

Mitsuru Okada

Independent
66
External Directors

Men—

Norikazu Sahashi

Independent
External Directors

64

Men

7

○

○

Nobukatsu Mizuno

Independent
External Directors

70

Men

5

○

○

●

●

Mitsuyo Kako

Independent
External Directors

69

Women

3

○

○

●

●

C

B

○

●

●

○

●

A

Audit

O

●

G

●

●
●

SA

M

F

S

T

●

●

●

●
●

●
●

H

●

●
●

●
●
●

Note: A: Appointment, Reward Committee C: Corporate management B: Business knowledge O: Operation strategy G: Global SA: Sales marketing
M: Management risk F: Financial accounting S: Sustainability T: Technology innovation H: Human resource, education, diversity50Non-Financial Information and Company Information
Main Sustainability Reporting
Environment (the Daiseki Group)

Society (the Daiseki Group)

Scope 1 Emission Breakdown (FY2023)

(tons of CO2)
Scope 1 Emission

Diesel fuel13,755City gas

5,237
3,921

Others5,038

Scope 3 Emission Breakdown (FY2023)

(tons of CO2)
63,184
17,592

4. Transportation and distribution (upstream)

14,772

3. Activities related to fuel and energy not included in Scope 1 and 2

42,246

7. Employees’commute

2,302

6. Business trip

0

15. Investments

0

14. Franchise

FY2021

FY2022

27,148

Scope 2

14,246

Scope 3

Total

Amount of materials received for recycling

27,951

14,153

9,990

105,450

152,931

156,809

146,844

194,822

194,750

Scope 1 and 2 emissions intensity
Scope 1 and 2 emissions intensity

FY202327,738FY2022 end

FY2023 end

0

0

0

FY2021(tons of CO₂/tons)

98

100

100

100

FY2022

FY2023

FY202139

Category

Number of flexible work arrangements utilization
Category

Number of short work hours utilization

2,061,092

Training-related investments

(MWh)

FY2021

FY2022

FY2023

0

330

8,849

33,738

Electricity (power by recycled energy)

Diesel fuelCity gas

Heavy oil B (recycled heavy oil)

Others34,35325,99650,972

51,29455,71625,384

27,11529,167

16,30014,895

15,231

24,36426,852

21,288Energy intensity(MWh/tons)
FY2021

Energy intensity

FY20220.09

FY20230.08

0.08

Note: Calculated with amount of materials received for recycling at Daiseki as thedenominator and energy consumption as the molecule

Water consumption

(10,000 tons)

FY2021

Water consumption

FY202295.6

FY202396.9

39(people)FY2022

FY2023

FY2022

FY2023186

141(people)7

6

Number of nursing leave utilization

2,072,229

Note: Calculated with amount of materials received for recycling at Daiseki as thedenominator and the emission for Scope 1 and 2 as the molecule39

Number of short work hours utilization

1,808,547

0.019(Hours)Number of flexible work arrangements utilization

Category

Electricity (power by non-recycled energy)

20

15
100

FY2023

Energy consumption

FY202315

FY20220.021

FY2022100

FY20210.023

1.0

FY2021 end

Average monthly overtime hours(tons of CO2)

Scope 1

FY2023

Average monthly overtime hours

0

Total CO2 emissions

FY2022
3.0

Rehired Employees (%)

1,067

13. Lease assets (downstream)

Mid-career hire rate*

Re-employment rate of retirees (%)

7,587

12. Disposal of sold products

141

(%)

Category

Number of handicapped
persons employed (people)

444

11. Use of sold products

93

132

Employment of handicapped persons and re-employment

356

10. Conversion of sold products

794

86

Mid-career hire rateNumber of foreigner
employees (people)

0

9. Transportation and distribution (downstream)

786

Number of foreigner employees

876

8. Lease assets (upstream)

Regular positions(people)FY2023 end*Percentage of manager and higher position employees within new hires

6,383

5. Wastes generated by businesses

FY2022 end

Not categorized

Scope 3 Emission

2. Capital goods

Category

General positions

Heavy oil B (recycled heavy oil)

1. Purchased products and services

Breakdown of regular positions and general positions

Number of nursing leave utilization(people)FY2022

FY202300(Millions of yen)

Training-related investments

FY2022

FY2023

FY2022

FY202327

Specific health guidance rate23

Category

Employees who needed specific health guidance rate*

(%)
25

26

*Percentage of employees who needed specific health guidance within those who
took comprehensive health examinations

Smoking rate

(%)

Category

FY2022

Smoking rate*

FY202338

36*Percentage of employees who responded that they smoke among those who took
comprehensive health examinations

Number of shareholding association members
Number of shareholding
association members*(people)FY2021 end

FY2022 end

FY2023 end

622

694

729

*Number of shareholding association members within group

93.3

Implementation of Environmental Management
FY2022 end FY2023 end

Number of business sites

Number of sites certified for ISO 14001 or Eco Action

Number of sites that implemented audits related to environment and laws and regulations

41

42

19

21

19

21

Governance (Daiseki or the Daiseki Group)
Number of directors
Internal director

External director(people)As of May 26, 2022 As of May 25, 2023
3

3

3
（1）

4
（1）

Number of Board of Directors held and attendance rate
Number of Board of Directors (times)

Attendance rate (%)

FY2022

FY2023

98.2

95.5

21

21

( ) shows female (people)

Compensation for executives

FY2022

51

Number of committees held
FY2022
Appointment and Compensation Committee
1
Audit and Supervisory Committee
14(times)
FY2023

1
14

R&D cost (the Daiseki Group) (Millions of yen)
FY2023

Directors (Excluding Audit & External Directors (Audit & Directors (Excluding Audit & External Directors (Audit &Supervisory Board Members) Supervisory Board Member) Supervisory Board Members) Supervisory Board Member)
Number of executive (people)
53
53
Compensation amount (million yen)
223
5
147
6

R&D cost

FY2022110

FY2023179

Third-Party Assurance

Verification Opinion

4 July 2023
Opinion No：SGS23/050

Mr. Tetsuya Yamamoto
President
Daiseki Co., Ltd.
1-86 Funami-cho Minato-ku, Nagoya, Aichi, Japan

Objective

SGS Japan Inc. (hereinafter referred to as "SGS") was commissioned by Daiseki Co., Ltd. (hereinafter referred toas "the Organization") to conduct independent verification based on Criteria of Verification (ISO14064-3: 2019 andthe SGS verification protocol) regarding the data prepared by the Organization on the scope of verification(hereinafter referred to as “the Statement”). The objective of this verification is to confirm that the Statement in the
Organization's applicable scope has been correctly calculated and reported in the Statement in conformance withthe criteria, and to express our views as a third party. The Organization is responsible for the preparation and fairpresentation of the Statement.

Attached file

4 July 2023
Opinion No：SGS23/050

The details of the scope of verification
The scope
1
The performance data Scope 1 and 2
include energy related greenhousegas emissions
Energy consumption
2

Scope 3 (category 1)

The boundary
The Organization and theconsolidated companies

The statement
Scope 1： 27,951 t-CO2
Scope 2： 9,990 t-CO2

The Organization and theconsolidated companies

63,184 t-CO2

Scope

The scope of verification is Scope 1 and 2 emissions, energy consumption, and Scope 3 emissions.
The period subject to report is from 1 March 2022 to 28 February 2023.
Refer to the attached sheet for the detailed scope of verification.

Procedure of Verification

The Statement was verified in accordance with Criteria of Verification, and the following processes were
implemented at a limited level of assurance:
Verification of the calculation system: Interviews on the measurement, tabulation, calculation, and reporting
methods employed by the Organization as well as review of related documents and records
Verification of the Statement: On-site verification and voucher review conducted at the Daiseki Co., Ltd.
Hokuriku Works and Kansai Works, and analytical procedures and interviews for the other sites in the scopeof verification carried out at the head office
The criteria for this review are based on Act on the Rational Use of Energy, the GHG Emissions Calculation andReporting Manual Ver. 4.8, Basic Guidelines on Accounting for Greenhouse Gas Emissions throughout the Supply
Chain, Ver. 2.5, Emission Factor Database on the same Accounting Ver. 3.3, IDEA Ver.2.3 and the protocol
specified by the Organization.

Conclusion

Within the scope of the verification activities employing the methodologies mentioned above, nothing has come toour attention that caused us to believe that the Organization's Statement was not calculated and reported inconformance with the criteria.
SGS Japan Inc. affirms our independence from the Organization, being free from bias and conflicts of interest with
the Organization.

For and on behalf of SGS Japan Inc

Yokohama business Park North Square Ⅰ
134, Good-cho, Hodogaya-ku,Yokohama
Knowledge
Management Committee Member
Head of Certification/Accreditation

Yuji Takeuchi

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52

Non-Financial Information and Company Information
Third-Party Opinion
Associate Professor in the Graduate School of Agricultural and Life Sciences,
The University of Tokyo and the University of Tokyo University Research Administrator

Dr. Momo Nakanishi
Dr. Nakanishi completed a PhD in agriculture in the University of Tokyo’s Graduate
School of Agricultural and Life Sciences. After working as a post-doctoral fellow at the
Hospital for Sick Children (Toronto) and a researcher in the Japan Science andTechnology Agency’s Department of Industry-Academia Alliance, she took a position asa Project Research Associate in the University of Tokyo’s Graduate School of Agriculturaland Life Sciences in 2016. She became a Project Lecturer in the same department in
December 2017, and has been in her current role since April 2021. She has administered
the University of Tokyo’s One Earth Guardians Development Program since its founding.
The resources produced by the Earth are finite. The rate at whichhuman activities are consuming these resources outstrips their rateof production, with Earth Overshoot Day*—the point at whichhuman consumption will have used up all the resources that the
Earth can regenerate in a calendar year—set to be August 2nd in
2023. If everyone in the world lived as we do in Japan, this datewould be May 6th. In other words, life in Japan today takes an“advance”on the Earth’s resources before we are even halfway
through the year. Unless we work to establish a circular economy assoon as possible, a challenging future for continued human life on
Earth is all too easy to imagine.
When it comes to recycling of resources, what kind of industrial
waste treatment processes we can implement is a key question forpresent-day society. From the point of view of the resource balance
described above, we no longer have the luxury of throwing away
unnecessary“waste.”As a recycling company, Daiseki advocates aview of waste materials as resources and tackles this key challenge
directly. I consider Daiseki to be standard bearers for a societal shift
toward a circular economy.
The One Earth Guardians Development Program (OEGs) wasstarted in 2017 within the University of Tokyo’s Faculty ofAgriculture in the Graduate School of Agricultural and Life Sciences.
It aims to develop a group of scientists, the One Earth Guardians,
who will take action to secure the future of the Earth so that humans
and all other forms of life can be living here together in harmony
100 years from now. The OEGs is a framework for the University
and a range of organizations and individuals to cooperate todevelop human resources with the skills to do this, allowing industry
and academia to work collaboratively to solve social andenvironmental issues.
Daiseki has been closely involved in the work of the OEGs since2022. A core component of the OEGs curriculum comprises
practical internships that foster the ability to identify and solve issues
within their social context. During practical internships with Daiseki,
students have gained insight into Daiseki’s areas of activity andexpertise and engaged in approximately six months of debate andresearch around the question of successfully balancing solutions toenvironmental issues in the aim of creating a circular economy andbusiness feasibility, after which they put forward their own
suggestions in this area. While the different format of the internshipto their research at the University may sometimes be confusing,participating students have also learned about and gained direct

experience of perspectives that will be crucial to the businessviability of their ideas. This approach to the issue is not one thatstudents can easily discover and adopt purely within the educationaland research setting of the University, yet it is a vital skill for taking
action that brings in wider society. Discovering the possibilities forlinking the research findings they have been learning about to onthe-ground problem-solving has not only opened up their future
career options but also seems to have been an encouraging
experience for them. This is a step on the path to developing humanresources who, while drawing on their training and perspectives as
scientists, will work in a variety of fields to contribute to creating asustainable society, something that can give us hope for the future.
I would like to briefly touch on the concept of the“bioeconomy,”a sister concept of the circular economy that refers to economic
activity that utilizes biotechnologies and biological resources withoutstraining the biosphere. There is significant overlap between the twoconcepts, and the idea of the“circular bioeconomy,”which brings
the two together, is gaining prominence in the US and Europe.
My field of study, agricultural science, is dedicated to making use
of natural resources through learning from living things andcapitalizing on their capacities. Yet this discipline, too, considers thecircular use of resources to be a matter for urgent attention. In orderto bring academic expertise to bear in solving real-world issues,cooperation with industry players is indispensable. I feel that ourcollaboration with Daiseki, leaders in creating recycled products
from industrial waste, has enormous potential, and it also gives me arenewed determination to consider what we can achieve byworking together.
The expression“venous industry”perfectly captures the characterof the sector. Animals maintain their vital functions by circulating
fluids through their bodies, and cannot sustain life if their blood flow
stops or they lose a great deal of blood through external bleeding.
While the arteries that deliver blood to all of our internal organs may
be the better-known of the two blood vessels, the circulatory system
could not exist without the veins that return blood flow to the heart.
When we extend this metaphor to society and economic activity, it
is clear that Daiseki has a significant role to play in its capacity as
part of the venous industry. If we were to consider the Earth as asingle huge and complex living entity, we would hesitate to declarethat it is entirely healthy in its current state—but we can hope thatthe flow of the veins back to the heart of our planet will revive it.

*For more information on Earth Overshoot Day, please follow the link below.
Global Footprint Network https://www.overshootday.org/newsroom/past-earth-overshoot-days/

53

Daiseki Group Overview● Corporate Overview
Company name Daiseki Co., Ltd.

President and Representative Director Tetsuya Yamamoto
FoundedNovember 1, 1945

Established October 1, 1958
Head office

1-86, Funami-cho, Minato-ku, Nagoya-shi, 455-8505● Stock information

as of February 28, 2023

Securities code

9793
Tokyo Stock Exchange Prime Section
Nagoya Stock Exchange Premier Section

Listed stock exchangeRound lot

100 stocks

Tel: +81-52-611-6321 (Representative)

Total number of authorized shares

79,200,000 stocks

FAX: +81-52-611-0160 (Representative)

Total number of stocks issued

51,000,000 stocks

Number of stock holders

5,165

TEL: +81-52-611-6322 (Head office)
FAX: +81-52-612-4382 (Head office)Capital6.382 billion yen (as of February 28, 2023)

Sales(consolidated) 58.572 billion yen	(non-consolidated) 34.013 billion yen(year ended February 28, 2023)
Number of employees (consolidated) 1,114(non-consolidated) 736 (as of February 28, 2023)● Daiseki Group Overview
Daiseki Co., Ltd. [Nagoya city]
Waste collection, Intermediate treatment and recycling

From March 1 through end of
February of the following year

Fiscal year
Annual General Meeting of Shareholders

May of each year

Shareholder registry administrator

Mitsubishi UFJ Trust andBanking Corporation

Audit company

KPMG AZSA LLC.

● Rating information

Rating and Investment Information, Inc. (R&I)◦Rating A- ◦Announced on November 18, 2022

Manufacturing and sales of petroleum products
Daiseki Eco. Solution Co., Ltd. [Nagoya city]
Soil pollution survey, purification process, etc.
Hokuriku Daiseki Co., Ltd. [Kanazawa, Ishikawa]
Manufacturing of lubricant and sales of
petroleum products
Daiseki-MCR Co., Ltd. [Utsunomiya, Tochigi]
Lead refining, recycling of used batteries
System Kikou Co., Ltd. [Minato-ku, Tokyo]
Cleaning work and related work for tankstorage equipment
Green Arrows Central Co., Ltd. [Tokai, Aichi]
Plasterboard recycling

Green Arrows Kyushu Co., Ltd. [Kasuya-Gun, Fukuoka]
Plasterboard recycling

Sugimoto Trading Company Co., Ltd. [Hikone, Shiga]● Assessment by a third party

CDP

B

MSCI

BBB

S&P

Score 43

CDP－Climate Change 2022
March 2023
March 2023

FTSE ESG Rating 3.1
June 2023

Nikkei SDGs
November 2022★★★★

Toyo Keizai SDGs
Utilization of human resources A, Environment AA,
Corporate governance A, Sociality A, Basic A,
Growth potential A, Profitability, AAA, Safety AA,
Size AA
December 2022

SOMPO Sustainability Index
February 2023

A

General waste disposal, waste plastic recycling

Sugimoto Paper Industry Co., Ltd. [Nagahama, Shiga]
Collection and recycling of used paper

54

Daiseki Co., Ltd.
1-86 Funami-cho, Minato-ku, Nagoya, Aichi, Japan, 455-8505
https://www.daiseki.co.jp/english
Published in Jul. 2023

Tel: +81-52-611-6321 (Representative)